TMI Blog2023 (11) TMI 881X X X X Extracts X X X X X X X X Extracts X X X X ..... eceived as gift. Even, if concession of Rs. 2 lakhs is given to the value of assets acquired during check period, the disproportionality will be reduced to only marginally and not to the extend to fall outside the scope of the offence under section 13(1)(e) of the P.C Act or Section 109 r/w 13(1)(e) of P.C Act. Thus, it is evident that the deceased first accused being a Public Servant had acquired wealth above 400% of his known source of income. From undeclared source, the properties been acquired by the public servant (A1) in his name and in the name of his wife (A-2) also in the name of his minor children. A-2 have lend her name for purchasing the property through source undeclared. Therefore, the trial Court judgement of conviction dated 15/11/2000 is hereby confirmed. The offence being acquiring wealth by a public servant beyond his known source of income and A-2 for aiding the public servant, had been sentenced for one year R.I being the minimum sentence prescribed under the law. So there cannot be further reduction of sentence. In such circumstances, the appellant/A2 has to be sentenced to undergo atleast the minimum sentence which is one year. Accordingly, the judgment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ehalf of A.1 and that you A.2 thereby committed an offence punishable under section 109 I.P.C. r/w. 13 (2) r/w.13 (1) (e) of Prevention of Corruption Act, 1988 and within the cognizance of this court. 3. To prove the prosecution case, 62 witnesses (P.W.1 to P.W.62) were examined. Marked 160 Exhibits (Ex.P.1 to Ex.P.160) and 31 material objects (M.O.1 to M.O.31). On the side of the defence, 30 witness (D.W.1 to D.W.30) and 15 Exhibits (Ex.D.1 to Ex.D.15) were marked. 4. The trial Court found both the accused (A1 A2) guilty and sentenced them vide judgement dated 15.11.2000 as below:- Accused Offences under Section Conviction and Sentence passed by the Trial Court A-1 13(2) r/w 13(1)(e) of P.C Act. To undergo two years R.I and to pay fine of Rs. 1000/-, in default of payment of fine, 2 months S.I. A-2 109 of I.P.C r/w 13(2) r/w 13(1)(e) of P.C Act. To undergo one year R.I and to pay fine of Rs. 5000/-, in default of payment of fine, 1 months S.I. 5. The trial Court determined t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... perties including both movable and immovables as well as valuable securities and bank balance in the account maintained in the name of the accused persons, accepted the plea of the defence that A/c Machines worth Rs. 43,800/- shown in Serial No.22 in the Statement-II, also been included to the value of the house in item No.17 of the same Statement as found in Ex.P.144 and evidence of P.W-59, hence excluded Rs. 43,000/-. Likewise, considering the rival claim regarding the value of the second hand Ambassdor Car purchased in the name of A-2, based on the statement of account and evidence of Court reduced the value from Rs. 1,30,000/- to Rs. 1,00,000/-. In respect of item in serial No.18, the Diesel Car Premier 137D purchased under hire purchase scheme through M/s.Sundaram Finance, based on the statement of account and evidence of PW-19, the trial Court has held that towards the repayment of loan for the purchase of the car A2 had paid Rs. 2,33,229/- therefore, the value of the car has to be assessed as Rs. 2,33,229/- instead of Rs. 2,18,825/- as found in Statement-II serial No.18. In respect of the value of jewels mentioned in serial Nos.29, 30 and 31 totally worth of Rs. 1,48,000/- a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ized during the search of the accused premises, deliberately it was not relied on by the prosecution with an ulterior motive. When same was produced as defence documents, the Trial Court has failed to give due consideration to the Income Tax Returns even though it was filed much before to the registration of the case. 14. The Learned Counsel for the appellants also submitted that, even at the beginning of the check period A-1 had Rs. 3,59,954/- and A-2 had Rs. 2,43,000/- cash in hand. However, the prosecution had shown only Rs. 1000/- as cash in hand at the beginning of the check period. The value of the house constructed by A-1 been highly inflated. The articles given as gift during house warming ceremony, cash gift given during the ear boring ceremony of the children and the evidence of defence witnesses in this regard were not taken into the account. 15. Further, the Learned Counsel also emphasised that the Income Tax Returns Ex.D-2 and Ex.D-3 filed before initiating the criminal prosecution were subjected to Commissioner Appeal and further appeal to the Income Tax Appellate Tribunal. Since those orders passed on 05/03/2003 and 08/11/2005 respectively after the disposa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecution under Section 13(1)(e) of P.C Act since those proceedings are primarily connected with payment of tax for income and not with the source of income. This legal issue had been settled by the Hon'ble Supreme Court in State of Karnataka -vs- Selvi.J.Jayalalithaa reported in 2017 (7) SCC 263 at paragraph Nos.252 to 254 Therefore, the additional documents Ex.D-16 and Ex.D-17 filed during the trial has no significant relevancy to interfere the well considered judgment of the trial Court. 18. The Learned Additional Public Prosecutor for the respondent/State also submitted that the oral evidence of defence witnesses, who are mostly relatives of the accused has rightly been disbelieved by the trial Court since their oral evidence regarding gifts given during house warming ceremonies and other functions conducted by A-1 for ear boring of his children were not supported by any reliable documents. The claim of the accused that apart from 5 acres of agricultural land shown in Statement-I of the final report, he had purchased 1.29 acres of land from his brother (P.W-49) prior to the check period but got the property registered in the name of his minor son under Ex.P.6 dur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have derived income from agricultural lands which they taken on lease or purchased prior to the check period but formally transferred in their family members name, during the check period. In addition, A-1 as HUF derived income through money lending. These source not taken into account by the prosecution as known source of income. A-1 and A- 2 had cash of about Rs. 6 lakhs at the beginning of check period but it was not taken into the account by the prosecution. 24. At the outset, it is made clear by the Hon'ble Supreme Court in the judgment of Selvi.J.Jayalalitha, cited supra, that, 252. The High Court, on the other hand, readily accepted the income tax returns filed by the assessee and affirmed the claim of A1 of agricultural income of Rs. 52,50,000/-. It was of the view that though the income tax returns had been filed belatedly, the same per se could not be a ground to reject the same as a proof of the agricultural income of A1 from grape garden. Thereby, the High Court enhanced the agricultural income of A1 to Rs. 52,50,000/- permitting an addition of Rs. 46,71,600/-. 253. Apart from the fact that the approach of the High Court on this aspect appears to b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pectively. The assessee had apparently exaggerated his agricultural income, camouflage his other income under the garb of agricultural income. Therefore, for the difference, the assessee has to pay income tax and penalty. 27 . The said assessment order was challenged by the A-1 before the Commissioner of Income Tax (Appeals). The Commissioner as Appellate Authority accepted the opinion given by VAO of the jurisdiction instead of the data provided by the Agricultural Department and has held that, due to better farming practise, the assessee could have gained higher yield and corresponding income. For the said reason, the order of the Assessing Authority was set aside. On appeal by the Department was dismissed by the ITAT (Ex.D-17) confirming the order of the Commissioner. 28. This Court, on perusing these two additional documents find that, these orders speak about whether the agricultural income declared by the assessee for the purpose of exemption was actual or inflated. The Income Tax Department has not tested whether the source of the income fake or genuine. Further, it is to be noted that, these orders came to be passed after initiating criminal prosecution and deliver ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eturns only in the beginning of the year 1996 and submitted block assessment return but not earlier. Same been tested by the Commissioner on Appeal and by the Appellate Tribunal on further appeal by the Department for assessment tax on the income sought to be exempted. The written submission presented before the trial Court by A-1 that, he was cultivating lands of Namachevaya Mudaliar, Meenakshiammal under lease and in the year 1988, he purchased 1.29 acres of land from his brother A.M.Pandi thus, had 6.37 acres land on his own and 6.61 acres of land under lease not supported by any legally reliable evidence. The self serving evidences spoken by interested witnesses in respect of immovable properties are hard to believe. Particularly, when A-1 himself claims that, he was a full time Politician, his tall claim of cultivating about 6.61 acres of land under lease besides his own 5 acres of land rightly been disbelieved by the trial Court for it lacks evidence. 32. For the reasons stated above, this Court holds that the Statement-I about the Assets at the beginning of check period does not suffer any omission or error to interfere. 33. Statement-II relied by the prosecution c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Tmt. Nallammal Sale Deed Doc. No. 3359/93 dt: 22.09.93 of S.R.o Kulathoor, Kerala State. (Rs.1,50,500/- + Stamp duty Rs. 9050/-) 1,59,550/- 9. 2.48 Acres of wet land in S.No.256/2 261/2 at Kodikulam during 1994 purchased in the name of Tr.Rajkumar Pandian, minor son of Tr.A.M.Paramasivan Sale Deed Doc. No. 608/94 dt. 04.04.94 of S.R.O. Thamaraipatty. (Rs.80,600/- + Stamp Duty Rs. 9,680/-) 90,280/- 10. 2.43 Acres of wet land in S.No.259/2 331/1 at Kodikulam during 1994 purchased in the name of Tr. Selvakumar Pandian Sale deed doc. No.1772/94 dt. 12.09.94 of S.R.O. Thamaraipatty (Rs.1,23,160/- + Stamp duty Rs. 14,800/-) 1,37,960/- 11. 1.29 Acres of wet land in S.No. 207/2 3 at Kodikulam during 1994 purchased in the name of Tr. Selvakumar Pandian, Sales Deed Doc. No. 1902/94 dt.23.9.94 of sub Registrar's Office Thamaraipatty. (Rs.70,950/- + Stamp Duty 8,520/-) 79,470/- 12. House site measuring 3045 Sq.ft. at 18-B HIG Colony Anna Nagar, Madurai 20 purchased during 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... One Hero Honda 2000 watts Generator acquired by Tr.A.M.Paramasivam during 1995. 21,200/- 25. One Dish Antenna acquired by Tr.A.M.Paramasivam during 1995. 12,000/- 26. One Office table with six chairs acquired by Tr.A.M.Paramasivam during 1995. 11,800/- 27. One during table with 7 chairs acquired by Tr.A.M.Paramasivam during 1995. 11,000/- 28. Teak wood single and double cost each 2 in Nos. acquired by Tr.A.M. Paramasivam during 1995. 20,000/- 29. 10 sovereigns of gold (old) jewels purchased by Tmt.Nallammal during 1991. 28,000 30. 25 soverings of gold (old) jewels purchased by Tmt. Nallammal during 1992. 75,000 31. 15 sovereigns of gold (old) jewels purchased by Tmt. Nallammal during 1993. 45,000 32. Share certificates of National Co-op. Sugar Mills Alanganallur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erties in Serial Nos.9 to 16. 36. In the HIG Colony Anna Nagar, a plot of TNHB, purchased for Rs. 2,78,856/-. A-1 had constructed a house which is estimated as Rs. 20,00,000/- worth by the prosecution. The evidence of D.W-30 Rajasekaran authorised Valuer for Central Government Department and his valuation report Ex.D.15 is relied by the defense to show that the valuation of the house in Serial No.17, building on the plot purchased in the year 1992 (Serial No.12) for Rs. 2,78,856/- was only Rs. 9,97,270/-. 37. D.W-30 is a freelance valuer. On the request of A-1, he has inspected the house and given his valuation certificate. His valuation report Ex.D-15 is half the value shown by the P.W.D Valuer Mr.Muthukumarasamy (P.W.59). The proceedings during the inspection of the house and the valuation report given by P.W-59 are marked as Ex.P-143 and Ex.P-144. The photographs of the house are marked as M.O.1 to M.O.31. 38. The Trial Court in its judgment at paragraph Nos.83 to 85 had discussed the evidence regarding the value of the house relied by the prosecution and the defence. On comparing the valuation report of P.W-59 marked as Ex.P-144 and the valuation report of D.W-30 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the prosecution. On all other aspects, the value shown in Ex.P-144 to be accepted. 42. As far as the two cars shown at Serial Nos.18 and 19, the trial Court has re-fixed its value and given the reason for re-fixing. No further contemplation on the value of these cars is required. 43. Serial Nos.20 to 28 are house hold articles, electronic appliances like TV, Fridge, A/c machines and sofa set, generator, chairs, dinning table and wooden cots. The defence has marshalled the relatives to say these items were presented by them during the house warming ceremony. There is no documentary proof for this claim. The trial Court deleted Rs. 43,800/- the value shown for the two A/c Machines (Serial No.22), since the value of the A/c machines is included in the construction cost of the building. 44. In so far as other items, the trial Court has accepted the prosecution value. For the sake of argument, even if the said explanation is accepted, assuming that the relatives of A-1 and A-2 presented those household articles during the house warming ceremony, the entire value of these house hold appliances like Colour TV - Serial No.20 for Rs. 20,390/-; BPL Fridge - Serial No.21 for R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of share in the partition of ancestral property or bequest under a will or advances from close relations would come within the expression known sources of income provided the second condition stands fulfilled that is to say, such receipts were duly intimated to the authorities as prescribed. 11. We have gone through Rules 14, 17 and 19 of the Rules. Rule 14 lays down that a government servant on occasions such as weddings, anniversaries or religious functions may accept gifts up to a certain limit, if he makes a report of such fact to the Government within a period of one month. Sub-rules (4) and (5) provide, inter alia, that in any other case, the government servant shall not accept any gift without the sanction of the Government and if the gift exceeds Rs 2000, except through an account payee cheque. Rule 17 deals with investment, lending and borrowing and provides inter alia that government servant may give to, or accept from a relation or a personal friend, a purely temporary loan. Rule 19 lays down that the government servant must intimate the details of property inherited or acquired by the government servant. There is no absolute embargo or prohibition in the Rul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... claimed known sources of income of an accused who is investigated under the PC Act, 1988. The prosecution can rely upon the information furnished by the accused to the authorities under law, rules and orders for the time being applicable to a public servant. No further investigation is required by the prosecution to find out the known sources of income of the accused public servant. As noticed above, the first part of the Explanation refers to income received from legal/lawful sources. This first part of the expression states the obvious as is clear from the judgment of this Court in N. Ramakrishnaiah [N. Ramakrishnaiah v. State of A.P., (2008) 17 SCC 83 : (2010) 4 SCC (Cri) 454] . 42. Thus, it is evident from the aforesaid that the expression known source of income is not synonymous with the words for which the public servant cannot satisfactorily account. The two expressions connote and have different meaning, scope and requirements. 46. In the instant case, the known source of income for A-1 and A- 2 was the pay received from the Legislative Assembly and the Agricultural income. The salary income and other perks of A-1 is spoken P.W-8 Soundarabai Satyavati an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... length. The basic question that emerges in the present case is whether the accused could be saddled with all the unaccounted money at his hand or not. It is the admitted position that both the husband and wife were living together. The wife was running three concerns though those concerns were running in loss. Yet she could manage to earn black money by selling goods without bills and amassed this wealth without disclosing the same to the Income Tax Authority and when the raid was conducted she disclosed the unaccounted money and accepted herself for being assessed by the Income Tax Department. Therefore, in this context, the question arises whether the joint possession of the premises by the husband and wife and the unaccounted money which has been recovered from the house could be said to be in exclusive possession of the accused. 50. In the present case, contrary to K.Inbasagaran case, the wife of the public servant is arrayed as second accused. She had no independent source of income till she got married the Public Servant in the year 1983 or thereafter. There was no property yielding income acquired by her till 1992. A-2 being charged for aiding and found guilty of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tune of Rs. 1,99,260/- rounded off to Rs. 2 lakhs which is in respect of Architect fees and the value of household articles claimed to be received as gift. Even, if concession of Rs. 2 lakhs is given to the value of assets acquired during check period, the disproportionality will be reduced to only marginally and not to the extend to fall outside the scope of the offence under section 13(1)(e) of the P.C Act or Section 109 r/w 13(1)(e) of P.C Act. Hypothetically, even if we take the value of the assets acquired during check period as Rs. 35,70,590/-, instead of Rs. 37,71,590/- then the asset worth Rs. 33,25,136/- will be disproportionate after deducting the likely savings of Rs. 2,45,454/- during the check period (Statement VI). Then, the percentage of disproportionality will be 417.34% instead of 442 % . 54. Thus, it is evident that the deceased first accused being a Public Servant had acquired wealth above 400% of his known source of income. From undeclared source, the properties been acquired by the public servant (A1) in his name and in the name of his wife (A-2) also in the name of his minor children. A-2 have lend her name for purchasing the property through source unde ..... X X X X Extracts X X X X X X X X Extracts X X X X
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