KANCHAN KUMAR VERSUS THE STATE OF BIHAR

KANCHAN KUMAR VERSUS THE STATE OF BIHAR 

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले

REPORTABLE

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO.  1562 OF 2022

ARISING OUT OF SLP (CRL) NO. 9601 OF 2016

KANCHAN KUMAR                 ...APPELLANT

VERSUS

THE STATE OF BIHAR      ...RESPONDENT

J U D G M E N T

PAMIDIGHANTAM SRI NARASIMHA J. 

1.  Leave granted.

2. This   appeal   is  against   the  concurrent   dismissals  by  the

Trial1

 and the High Court2

 of the application for discharge filed by

the   Appellant   under   Section   227   of   the   Code   of   Criminal

Procedure, 19733

.

1 Special Judge (Vigilance), Patna, in Special Case No. 9 of 2000 dated 28.03.2016. 

2 High Court of Judicature at Patna, in Criminal Miscellaneous No. 23031 of 2016 dated

05.10.2016.

3 hereinafter referred to as the ‘Cr.P.C.’

Page 1 of 16

3.  Facts   leading  to  the  filing  of  this  Appeal:  The Appellant

joined the Bihar State Financial Corporation4

 in the capacity of

an Assistant General Manager on 19.07.1974. After a period of

thirteen years, in 1987, a complaint came to be filed against the

Appellant for having allegedly purchased three houses and two

pieces of land in Bihar, which according to the complainant, was

disproportionate to Appellant’s known sources of income. This

complaint was inquired into, and after a detailed investigation,

the allegations were found to be false. Except for a residential

house   in   Patna,   which   the   Appellant   had   purchased   on

29.08.1988 for Rs. 2,26,500 with the help of a loan from the

BSFC, no other assets could be traced to the ownership of the

Appellant. However, despite finding no merit in the allegation, the

investigation was kept pending. 

4. In the meanwhile, life moved on and in 1996, the Appellant

joined the Oil and Natural Gas Commission5

 as Deputy General

Manager on deputation, keeping his lien with the BSFC.   Four

years after joining ONGC, an FIR came to be registered against

him   on   21.02.2000,  under   Sections   13(l)(d)   and   13(2)   of   the

4 hereinafter referred to as ‘the BSFC’.

5 hereinafter referred to as ‘the ONGC’.

Page 2 of 16

Prevention of Corruption Act, 19886

, on the same allegation that

he possessed assets disproportionate to his known sources of

income. These alleged assets were purportedly acquired during

his tenure with the BSFC, and consequently, the check period in

the   FIR   was   considered   from   the   date   he   joined   BSFC,   i.e.,

19.07.1974 to the date of registration of the residential house

purchased by him, i.e., 29.08.1988. The Appellant wrote a letter

to   the   Director   General   of   Police   (Vigilance),   Patna,   on

18.04.2002, raising a grievance that the calculations in the FIR

undervalued   his   income   and   overvalued   his   assets,   thus

depicting a false and inflated account of his expenditure.

5. Eventually a charge sheet came to be filed on 11.09.2007,

i.e., about seven years after the registration of the FIR, and in

fact, twenty years after the complaint on this very allegation was

found  to  be  false  by the  authorities.  Be that  as  it  may,  the

charge­sheet filed against the Appellant indicated that he earned

a total income of Rs. 3,01,561 and incurred an expenditure of Rs.

5,24,386 during the check period. In view of this, the charge

against   the   Appellant   was   of   having   amassed  Rs.   2,22,825,

disproportionate to his known sources of income.  The charge6 hereinafter referred to as the ‘PC Act’.

Page 3 of 16

sheet indicated two components of his income, being ­ i) savings

of Rs. 1,13,081 (1/3rd of his salary), and ii) home and car loan

from BSFC worth Rs. 1,88,480. On the other hand, the charge

sheet   included   six   components   of   his   expenditure,  being   –   i)

payment of Rs. 2,26,500 towards the construction of his house,

ii) general expenditure during the check period of Rs. 24,800, iii)

amount in bank deposit worth Rs. 55,000, iv) loan repayment of

Rs. 53,467, v) LIC deposit worth Rs. 6,057, and vi) estimated

value of articles found during a search conducted on 21.02.2000,

as being Rs. 1,58,562.

6. At the relevant stage, the Appellant applied for discharge

under “Section 239” of the Cr.P.C (which should have been under

Section 2277

) before the Court of Special Judge (Vigilance), Patna,

alleging   that   there   were   glaring   errors   in   the   calculation.

However, the Court summarily dismissed the application by  its

order   dated   28.03.2016,   without   analysing   or   examining   the

documents produced and the arguments advanced. The Court

held that:

7 Though the Appellant stated that the application is under Section 239 of the Cr.P.C., as

Special   Judges  appointed   under  the   PC  Act   are  deemed   to  be   Court  of   Session,  the

discharge application should have been filed under Section 227 of the Cr.P.C., and not

under Section 239 therein. The Ld counsel for the Appellant Shri Sunil Kumar, Senior

Advocate clarified this position of law while making his submissions.

Page 4 of 16

“Perused the record and I find that there is

sufficient materials against accused in this case

at   least   prima   facie   at   this   stage   to   frame

charge against the accused against whom there

is allegation that he during the check period

amassed. Although certain explanations have

been advanced by the learned counsel for the

petitioner but the same appears to be looked

into and appreciated during the course of trial

when the accused petitioner wife have a chance

to   prevents   innocence   producing   his   oral   or

documentary evidences. For the present I am

not satisfied with the explanation so produced

by the accused in his favour in support of his

discharge application.

Considering   the   aforesaid   facts   and

circumstances   the   charge   petition   of   the

accused petitioner namely Kanchan Kumar is

hereby   rejected.   Put   up   on   22.04.2016   for

framing of charge. The accused is directed to

remaining   physically   present   on   the   date   so

fixed by this court for framing of charge.”

7. Aggrieved by the dismissal of his application for discharge,

the   Appellant   moved   the   High   Court.   After   recounting   the

chronology   of   events,   the   High   Court   proceeded   to   quote

judgment   after   judgment,   and   finally   dismissed   the   revision

application by merely holding that: 

“15.  In   the   aforesaid   circumstances,   even   if

considering the submissions made on behalf of

petitioner,   for   argument’s   sake   needs   proper

verification   attracting   roving   enquiry   which

could be permissible only during course of trial.

Page 5 of 16

16. Much emphasis has been laid at the end of

the petitioner relating to valuation. With the cost

of repetition, the contention of the petitioner is

that as the raid was conducted on 21.02.2000,

on account thereof, the valuation having been

shown against the article so seized at the end

of the Vigilance must be considered to be in

consonance   with   the   date   of   recovery.   That

argument   happens   to   be   fallacious   in   the

background of the fact that from the case diary,

it is evident that valuation has been estimated

only. There happens to be complete absence of

prima facie material whereupon one could infer

that the value so affixed at that very moment

was   prevailing   rate   on   the   alleged   date   of

seizure. Furthermore, to ascertain genuineness

on this score will again attract roving enquiry

which for the present stage is found forbidden. 

17. Consequent thereupon, the instant petition

is  found  devoid  of  merit  and  is, accordingly,

rejected.”

8. It   is   against   the   aforesaid   order   that   the   Appellant   has

approached this Court.  

9. Submissions of parties: The Ld. Senior Counsel Shri Sunil

Kumar has submitted that the basic objection relating to the

calculation and wrongful inclusion of certain items was sufficient

for the Trial Court to discharge the Appellant. In a simple and

straight forward submission, he took us through certain glaring

errors that were evident from the record of the case before the

Page 6 of 16

Special Judge (Vigilance). In support of his submissions, he also

referred to the decisions of this Court in Union of India v. Prafulla

Kumar Samal and Anr.8

 and Ghulam Hassan Beigh v. Mohammad

Maqbool Magrey9

.

10. The counsel for the Respondent Shri Abhinav Mukerji AOR,

has contended that the Trial Court was right in dismissing the

discharge application. He submitted that the Courts could not

have   conducted   a   roving   inquiry   while   adjudicating   an

application under Section 239 of the Cr.P.C.

11. Issue:  The   short   question   arising   for   consideration   is

whether   the   Appellant   is   entitled   to   be   discharged   of   the

proceedings initiated against him under the PC Act. 

12. Legal provision and precedents: Section 227 of the Cr.P.C

relating to discharge is as under: 

“227.  Discharge  —  If, upon consideration of

the   record   of   the   case   and   the   documents

submitted   therewith,   and   after   hearing   the

submissions of the accused and the prosecution

in this behalf, the Judge considers that there is

not sufficient ground for proceeding against the

accused, he shall discharge the accused and

record his reasons for so doing.”

8 (1979) 3 SCC 4.

9 2022 SCC OnLine SC 913.

Page 7 of 16

13. The   threshold   of   scrutiny   required   to   adjudicate   an

application under Section 227 of the Cr.P.C., is to consider the

broad probabilities of the case and the total effect of the material

on record, including examination of any infirmities appearing in

the case.  In Prafulla Kumar Samal (supra), it was noted that:

“10. Thus, on a consideration of the authorities

mentioned   above,   the   following   principles

emerge:

(1)   That   the   Judge   while   considering   the

question   of   framing   the   charges   under

Section 227 of the Code has the undoubted

power to sift and weigh the evidence for the

limited purpose of finding out whether or not

a prima facie case against the accused has

been made out.

(2)   Where   the   materials   placed   before   the

Court   disclose   grave   suspicion   against   the

accused   which   has   not   been   properly

explained the Court will be fully justified in

framing a charge and proceeding with the

trial.

(3) The test to determine a prima facie case

would   naturally   depend   upon   the   facts   of

each case and it is difficult to lay down a

rule of universal application. By and large

however if two views  are  equally possible

and the Judge is satisfied that the evidence

produced   before   him   while   giving   rise   to

some   suspicion   but   not   grave   suspicion

against the accused, he will be fully within

his right to discharge the accused.

Page 8 of 16

(4)  That in exercising his jurisdiction under

Section   227   of   the   Code   the   Judge   which

under   the   present   Code   is   a   senior   and

experienced   court   cannot   act   merely   as   a

Post   Office   or   a   mouthpiece   of   the

prosecution, but has to consider the broad

probabilities of the case, the total effect of the

evidence and the documents produced before

the Court, any basic infirmities appearing in

the case and so on. This however does not

mean that the Judge should make a roving

enquiry into the pros and cons of the matter

and   weigh   the   evidence   as   if   he   was

conducting a trial.”      

                                        (emphasis supplied)

14. In  Sajjan  Kumar  v.  Central  Bureau  of  Investigation10

,  the

Court cautioned against accepting every document produced by

the prosecution on face value, and noted that it was important to

sift the evidence produced before the Court. It observed that:

“21.  On consideration of the authorities about

the scope of Sections 227 and 228 of the Code,

the following principles emerge:

...

(v) At the time of framing of the charges, the

probative value of the material on record cannot

be gone into but before framing a charge the

court   must   apply   its   judicial   mind   on   the

material placed on record and must be satisfied

that the commission of offence by the accused

was possible.

(vi) At the stage of Sections 227 and 228, the

court is required to evaluate the material and

10 (2010) 9 SCC 368.

Page 9 of 16

documents on record with a view to find out if

the facts emerging therefrom taken at their face

value   disclose   the   existence   of   all   the

ingredients constituting the alleged offence. For

this   limited   purpose,   sift   the   evidence   as   it

cannot be expected even at that initial stage to

accept all that the prosecution states as gospel

truth even if it is opposed to common sense or

the broad probabilities of the case...” (emphasis

supplied)

15. Summarising the principles on discharge under Section 227

of   the   Cr.P.C,   in  Dipakbhai   Jagdishchandra   Patel  v.  State   of

Gujarat,

11 this Court recapitulated:

“23. At   the   stage   of   framing   the   charge   in

accordance with the principles which have been

laid   down   by   this   Court,   what   the   court   is

expected to do is, it does not act as a mere post

office. The court must indeed sift the material

before it. The material to be sifted would be the

material which is produced and relied upon by

the   prosecution.   The   sifting   is   not   to   be

meticulous in the sense that the court dons the

mantle   of   the   trial   Judge   hearing   arguments

after   the   entire   evidence   has   been   adduced

after a full­fledged trial and the question is not

whether the prosecution has made out the case

for   the   conviction   of   the   accused.  All   that   is

required is, the court must be satisfied that with

the materials available, a case is made out for

the accused to stand trial. A strong suspicion

suffices. However, a strong suspicion must be

founded on some material. The material must

be such as can be translated into evidence at

11 (2019) 16 SCC 547.

Page 10 of 16

the stage of trial. The strong suspicion cannot

be the pure subjective satisfaction based on the

moral notions of the Judge that here is a case

where   it   is   possible   that   the   accused   has

committed the offence. Strong suspicion must be

the   suspicion   which   is   premised   on   some

material which commends itself to the court as

sufficient to entertain the prima facie view that

the   accused   has   committed   the   offence.”

(emphasis supplied)

16.1 Analysis:  Without getting into too many details, we

consider it to be appropriate and in fact sufficient to confine our

inquiry to three heads of expenditure indicated in the chargesheet itself. This limited inquiry will also satisfy the requirements

of Section 227 of the Cr.P.C. 

16.2 The first objection pertains to the inclusion an amount

of Rs. 55,000, recorded as the balance amount in the Appellant’s

bank account during the check period, and accordingly counted

as   an   expenditure   in   the   charge   sheet.   However,   the   Bank

Passbook   filed   by   the   Appellant,   which   was   available   to   the

Investigation Officer and the Special Judge (Vigilance), evidently

records a balance amount of only Rs. 11,998 during the checkperiod. The difference in the figures was not explained by the

Prosecution. Accordingly, the Special Judge (Vigilance) and the

Page 11 of 16

High Court failed to reconcile such a simple and straightforward

inconsistency in the Prosecution’s evidence. We are of the opinion

that only an amount of Rs. 11,998, recorded in the Appellant’s

Bank Passbook during the check­period as the balance amount,

is validly admissible as expenditure under this head.

16.3 The second objection relates to  the inclusion  of an

amount of Rs. 53,467 as expenditure towards repayment of the

loan from the BSFC. However, the amount repaid towards loan

instalments was already deducted from Appellant’s gross salary,

and the deducted figure was recorded as the total disposable

income with the Appellant during the check period. Hence, the

loan repayment cannot be separately counted as an expenditure

yet again. This is a glaring mistake. The Special Judge (Vigilance)

as well as the High Court did not consider this objection on the

ground   that   a   roving   inquiry   is   not   permissible   the   stage   of

discharge. 

16.4 The   third   objection   relates   to   the   inclusion   of   Rs.

1,58,562 as   the   value   of   the  articles   found   during   a   search

conducted in Appellant’s house on 21.02.2000, twelve years after

the check period of 1974 to 1988. There is nothing to indicate,

Page 12 of 16

even prima facie, that these articles found during the search in

the year 2000 were acquired during the check period. In the

absence of any material to link these articles as having been

acquired during the check period, it is impermissible to include

their value in the expenditure. We are therefore of the opinion

that the Appellant’s objection about inclusion of this amount in

the list of expenditure is fully justified. Unfortunately, even this

objection, which did not require much scrutiny of the material on

record, was not considered by the Special Judge (Vigilance) or the

High Court.

17.  The three heads of expenditure discussed hereinabove must

be excluded from Appellant’s total alleged expenditure during the

check   period.   First,   the   Appellant’s   actual   balance   amount

reflected in the Bank Passbook, i.e., Rs. 11,998, as against the

purported account balance of Rs. 55,000, must be taken into

account. Further, the second and third amounts, as indicated

above,   must   be   excluded   from   Appellant’s   total   expenditure

mentioned in the charge­sheet. Accordingly, the total expenditure

comes only to Rs. 2,69,355, and not Rs. 5,24,386, which is based

on certain mistakes that we have indicated hereinabove. It is this

Page 13 of 16

expenditure of Rs. 2,69,355 which is to be contrasted with the

income   of   Rs.   3,01,561   during   the   check­period.   These   facts

clearly demonstrate that there is no prima facie case made out by

the prosecution and therefore the Appellant was entitled to be

discharged. 

18. The conclusions that we have drawn are based on materials

placed before us, which are part of the case record. This is the

same record that was available with the Special Judge (Vigilance)

when the application under Section 227 of the Cr.P.C. was taken

up.  Despite  that,  the   Special   Judge  (Vigilance)  dismissed  the

discharge application on the simple ground that a roving inquiry

is   not   permitted   at   the   stage   of   discharge.   What   we   have

undertaken is not a roving inquiry, but a simple and necessary

inquiry for a proper adjudication of an application for discharge.

The Special Judge (Vigilance) was bound to conduct a similar

inquiry for coming to a conclusion that a prima facie case is made

out for the Appellant to stand trial. Unfortunately, the High Court

committed   the   same   mistake   as   that   of   the   Special   Judge

(Vigilance).

Page 14 of 16

19. Apart from the above analysis, we would note with great

distress   that   the   allegation   relating   to   Appellant’s

disproportionate income in the period between 1974 and 1988

was levelled in an FIR filed twelve years after the said period

concluded. The charge­sheet came to be filed seven years after

the registration of the FIR. The application for discharge came to

be dismissed on 28.03.2016, almost after a decade of filing of the

charge   sheet.   The   dismissal   was   affirmed   by   the   High   Court

seven months thereafter, i.e., on 05.10.2016. Finally, and most

unfortunately,   the   present   SLP   has   been   pending   before   this

Court for the last six years. In the meanwhile, the Appellant

superannuated from service in 2010, but had no option except to

contest   the   case.   He   is   now   72   years.   Continuation   of   the

prosecution, apart from the illegality as indicated hereinabove,

would also be unjust. 

20. For the reasons stated above, we allow the Criminal Appeal

arising out of SLP (Crl) No. 9601 of 2016, and set aside the

judgment and order of the High Court of Patna in CRLM No.

23031 of 2016 dated 05.10.2016, and that of the Court of Special

Page 15 of 16

Judge (Vigilance), Patna in  Special Case No. 09 of 2000, dated

28.03.2016, and discharge the Appellant.  

21. No order as to costs.

……………………………….J.

                                                            [B.R. GAVAI]

……………………………….J.

[PAMIDIGHANTAM SRI NARASIMHA]

NEW DELHI;

SEPTEMBER 14, 2022             

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