2025 INSC 618

REPORTABLE

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO. 2613 OF 2014

AMAN BHATIA …APPELLANT

VERSUS

STATE (GNCT OF DELHI) …RESPONDENT

J U D G M E N T

Crl. A. No. 2613 of 2014 Page 1 of 44

J.B. PARDIWALA, J.

For the convenience of exposition, this judgment is divided into the

following parts:-

INDEX

A. FACTUAL MATRIX ...................................................................... 2

B. IMPUGNED JUDGMENT ............................................................... 4

C. SUBMISSIONS ON BEHALF OF THE APPELLANT ......................... 6

D. SUBMISSIONS ON BEHALF OF THE RESPONDENT ...................... 9

E. ISSUES F OR CONSIDERATION ................................................. 10

F. ANALYSIS ................................................................................. 11

i. Legislative intent behind the definition of “public servant” under

Section 2(c) of the PC Act ........................................................................ 11

ii. Stamp Vendors are “Public Servants” ..................................... 17

a. Interpretation of ‘Remuneration’ in light of the Delhi Province

Stamp Rules, 1934 ................................................................................ 18

b. Meaning of ‘Commission’ under Section 194H of the 1961 Act and

Section 2(c)(i) the PC Act ...................................................................... 24

iii. Public Duty as the determinant of status of Public Servant ... 29

iv. Legality of appellant’s conviction .......................................... 32

G. CONCLUSION ............................................................................ 42

Crl. A. No. 2613 of 2014 Page 2 of 44

1. Leave granted.

2. This appeal arises from the judgment and order passed by the High

Court of Delhi in Criminal Appeal No. 348 of 2013 (“impugned

judgment”) by which the High Court dismissed the appeal filed by

the appellant herein and thereby affirmed the judgment and order

dated 30.01.2013 passed by the Special Judge in Complaint Case

No. 11 of 2009 holding the appellant herein guilty of the offence

under Sections 7 and 13(1)(d) read with Section 13(2) of the

Prevention of Corruption Act, 1988 respectively (for short, “the PC

Act”).

A. FACTUAL MATRIX

3. As per the case of the prosecution, on 09.12.2003, the complainant

went to the Office of the Sub-Registrar, Janakpuri, Delhi to purchase

a stamp paper of Rs. 10/-. The appellant, a licensed stamp vendor,

made a demand of Rs. 12/- for a stamp paper of Rs. 10/-. Against

the excess demand of Rs. 2/-, the complainant lodged a written

complaint with the Anti-Corruption Branch (for short, “ACB”).

Pursuant to the said complaint, a trap was laid by the ACB. The

complainant was handed over one GC note of Rs. 10/- and one GC

note of Rs. 2/-, smeared with phenolphthalein powder, by the Raid

Officer. The complainant alongwith the raiding party left for the

Office of the Sub-Registrar, Janakpuri, Delhi. After reaching there,

when the complainant asked for a stamp paper of Rs. 10/ -, the

appellant again made a demand of Rs. 12/-. The complainant gave

the smeared GC notes to the appellant who accepted them with his

Crl. A. No. 2613 of 2014 Page 3 of 44

right hand. At the signal of the panch witness, the raiding party

arrived at the spot. The appellant was apprehended. The wash of his

hand turned the solution of sodium carbonate pink and the notes

were allegedly recovered from the register kept for maintaining the

records of the stamp papers.

3.1 Upon completion of the investigation, chargesheet was filed in the

court of Special Judge (Anti-Corruption Brach), Delhi. The Special

Judge framed charges against the appellant for the offences

punishable under Sections 7 and 13(1)(d) read with Section 13(2) of

the PC Act respectively. The appellant denied the charge s and

claimed to be tried.

3.2 In the course of the trial, the prosecution examined nine witnesses,

of whom four are crucial for the adjudication of the matter at hand:

i. Complainant (PW-1);

ii. Panch witness (PW-4);

iii. Raid Officer (PW-6);

iv. Investigating Officer (PW-9)

3.3 The Trial Court, upon appreciation of the oral as well as the

documentary evidence on record, held the appellant guilty of the

offences with which he was charged and sentenced him to undergo

rigorous imprisonment for a period of six months and fine of Rs.

1000/- for the offence punishable under Section 7 of the PC Act and

rigorous imprisonment for a period of one year and fine of Rs. 1000/-

for the offence punishable under Section 13(1)(d) read with Section

13(2) of the PC Act. The sentences were ordered to run concurrently.

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B. IMPUGNED JUDGMENT

4. The pivotal issue that fell for the consideration of the High Court was

“whether a stamp vendor is a public servant for the purposes of the

PC Act or not.”

4.1 The High Court answered the aforesaid question in the affirmative.

It held that ensuring access to stamp papers, which are

indispensable for legal transactions, falls within the scope of

‘performance of a public duty’. The said public duty i.e., vending of

the stamps, is a licensed activity regulated under the statutes

governing the sale of judicial and non-judicial stamp papers. It

further held that the fact that stamp vendors purchase these papers

at a discounted rate before selling them to the public does not

diminish the public nature of the duty they perform. The High Court

added that in terms of Explanation 1 to Section 2 of the PC Act, it is

not necessary for the stamp vendor to be ‘appointed’ by the

Government in order to be a public servant.

4.2 The High Court also adverted to the Delhi Province Stamp Rules,

1934 (for short, “the 1934 Rules”) and observed that Rule 28 of the

1934 Rules stipulates the conditions governing the grant of license

to a stamp vendor and violation of the said rule would amount to an

illegal act. Further, Rule 28(xx) states that the remuneration to the

vendor in the form of a discount is allowed from time to time by the

orders of the local Government. The High Court further took note of

Rule 34 which provides for remuneration to stamp vendors by

Crl. A. No. 2613 of 2014 Page 5 of 44

entitling the licensed vendor of stamps to discount on the amount of

purchase.

4.3 Further, the High Court analysed the question whether any

“remuneration, fees or commission” was being paid to the stamp

vendors by the Government. In other words, whether the discount

availed by the stamp vendor at the time of purchase of stamps from

the treasury could be said to be ‘commission’ paid for the purpose of

performing duty in terms of Section 2(c)(i) of the PC Act. The Court

observed that the 1934 Rules clearly indicate the nature of the

remuneration paid to a stamp vendor. The Court termed the said

discount as a fee for performing the task of a licensed agent of the

Government. Further, from the reading of Rule 34(ii) and 34(iii) of

the 1934 Rules respectively, the Court reached the conclusion that

what is paid as commission to the stamp vendors is a discount at

the given rate on the stamps purchased and the same is treated as

a commission.

4.4 Lastly, the High Court considered the decision of the High Court of

Gujarat in Ahmedabad Stamp Vendors Association v. Union of

India, reported in 2002 SCC OnLine Guj 135 , relied upon by the

appellant to fortify his submission that once the stamp papers are

purchased by the vendor from the treasury, there is complete

ownership of the stamp papers with the vendors. The High Court

held that the said decision is not applicable to the facts of the case

in the same way as it was rendered in the context of Section 194H of

the Income Tax Act, 1961 (for short, “the 1961 Act”) and the

Crl. A. No. 2613 of 2014 Page 6 of 44

meaning of ‘commission’ was not considered in the light of Section

2(c)(i) of the PC Act.

4.5 Thereafter, the High Court proceeded to look into the evidence on

record to ascertain the correctness of the finding of the guilt. The

High Court noted that the panch witness had been consistent as

regards his statement about the appellant having accepted the

tainted money. In this context, the Court observed that if the

appellant had not demanded excess Rs. 2/-, there was no occasion

to accept it in the first place.

4.6 As regards the recovery of GC notes – whether those were recovered

from possession of the appellant or from the register lying on his

table, the Court observed that the wash of the appellant’s hand did

turn pink, and both the GC notes were found, even if not directly

from the appellant, then too certainly the notes were found placed

on the register. Further, the testimony of the Raid Officer, that it was

the panch witness who pointed out that money accepted by the

appellant was lying on his register, was found to be reliable and

trustworthy. The panch witness also stated that the accused made

an entry in the register after accepting the money. The High Court

was of the view that the evidence of the complainant corroborated by

the evidence of the Raid Officer established the culpability of the

appellant beyond reasonable doubt.

C. SUBMISSIONS ON BEHALF OF THE APPELLANT

5. Mr. S. K. Rungta, the learned Senior Counsel appearing for the

appellant submitted that the prosecution instituted against the

Crl. A. No. 2613 of 2014 Page 7 of 44

appellant under the PC Act itself was not maintainable. It was

argued that at best the prosecution could have been under the

Indian Stamp Act, 1899 (for short, “the 1899 Act”) alongwith the

1934 Rules, as these comprehensively regulate the sale of stamp

papers by licensed vendors and constitute a complete code for

offences related to stamps. The license of the appellant was

cancelled in terms of Section 69 of the 1899 Act read with Rule 29

of the 1934 Rules. He submitted in arguendo that, the said

cancellation was one of the consequences of alleged demand of

excess amount of Rs. 2/-. Hence, even if the appellant would have

been found guilty under the framework of the 1899 Act, the

maximum possible sentence would have been significantly lower

than what the Trial Court has imposed in the present case.

5.1 Mr. Rungta further submitted that a bare perusal of Section 2(c) of

the PC Act reveals that a ‘public servant’ has a co-relation with the

service or office under the Central Government, State Government or

the local authority. He argued that the definition is exhaustive and

a licensed stamp vendor does not fall in any of the clauses. Therefore,

the appellant cannot be said to be in service or in office of the Central

or State Government. Further, Mr. Rungta invited the Court’s

attention to Section 7 of the PC Act, prior to the amendment of 2018

and submitted that the provision deals with acceptance of any

gratification for showing any favour or disfavour to any person in

relation to an official act. To support his submission, he argued that

an excess amount of Rs. 2/- could not be said to be the motive or

Crl. A. No. 2613 of 2014 Page 8 of 44

reward for showing favour or disfavour with Central Government or

State Government.

5.2 The second limb of Mr. Rungta’s submission was that the

prosecution had failed to prove the demand and acceptance of an

excess amount of Rs. 2/- for sale of stamp paper of face value of Rs.

10/-. He submitted that the panch witness failed to support the case

of prosecution of demand of Rs. 12/- thereby rendering the arrest

memo, search and seizure memo also doubtful. Further, the

Investigating Officer admitted that the time of arrest of the appellant

was 7:15 PM, however, the raid was conducted around 3:45 PM.

5.3 He further submitted that there are glaring inconsistencies in the

testimony of the panch witness and the complainant as regards the

recovery of the GC notes. The High Court in the impugned judgment

expressed doubts on the recovery of the GC notes since the seizure

memo and other documents were drawn up only later at the office of

the ACB. He submitted that even the bottle containing the sodium

carbonate solution was sealed later at the Office of the ACB.

5.4 Mr. Rungta also highlighted a few mitigating circumstances for the

purpose of reducing the sentence awarded by the Trial Court, more

particularly, the fact that the appellant was only 19 years of age at

the time of the commission of the offence.

5.5 In such circumstances referred to above, he prayed that there being

merit in the present appeal, the same may be allowed and the

impugned judgment and order passed by the High Court may be set

Crl. A. No. 2613 of 2014 Page 9 of 44

aside and the appellant herein may be acquitted of the charges

levelled against him. Lastly, Mr. Rungta highlighted a few of the

mitigating circumstances for the purpose of reducing the sentence of

awarded by the Trial Court, more particularly the fact that the

appellant was only 19 years of age at the time of the commission of

the offence.

D. SUBMISSIONS ON BEHALF OF THE RESPONDENT

6. Ms. Aishwarya Bhati, the learned Additional Solicitor General

appearing for the respondent State, on the other hand, submitted

that no error, not to speak of any error of law, could be said to have

been committed by the High Court in passing the impugned

judgment. She submitted that the High Court has rightly taken the

view that the licensed stamp vendor is a public servant for the

purposes of the PC Act. She further submitted that the 1934 Rules,

more particularly Rule 34 therein makes it abundantly clear that

what is paid to the vendors by the Government is remuneration in

the form of discount. It was argued that the term “remunerated”

occurring in Section 2(c)(i) of the PC Act should be given a

meaningful interpretation so as not to frustrate the object of the PC

Act. She further argued that a stamp vendor cannot get away with

his liability under the PC Act by arguing that what is paid by the

Government is in the form of a discount and not remuneration.

6.1 The learned A.S.G. submitted that the reliance placed by the

appellant on the decision of the Division Bench of the High Court of

Gujarat in the case of Ahmedabad Stamp Vendors Association

(supra), as affirmed by this Court in Commissioner of Income Tax,

Crl. A. No. 2613 of 2014 Page 10 of 44

Ahmedabad & Ors. v. Ahmedabad Stamp Vendors Association ,

reported in (2014) 16 SCC 114, is totally misconceived and is of no

avail to the appellant. She argued that the said decision was in the

context of Tax Deducted at Source on “commission or brokerage”

under the contract of agency. In other words, the said decision was

considered only in the context of Section 194H of the 1961 Act.

6.2 She contended that the relationship between the Government and

the stamp vendors is that of principal and agent. The learned A.S.G.

further submitted that the High Court was right not only in saying

that the stamp vendors are public servants for the purposes of the

PC Act but even otherwise on merits also, the High Court rightly

affirmed the judgment and order of conviction passed by the Trial

Court.

6.3 In such circumstances referred to above, the learned A.S.G. prayed

that there being no merit in this appeal, the same may be dismissed.

E. ISSUES FOR CONSIDERATION

7. Having heard the learned counsel appearing for the parties and

having gone through the materials on record, the following two

questions fall for our consideration:-

a. Whether the High Court was right in holding that a licensed

stamp vendor falls within the ambit of a public servant for the

purposes of the PC Act?

b. If the answer to the aforesaid question is in the affirmative,

then whether the conviction of the appellant herein on merits

is sustainable?

Crl. A. No. 2613 of 2014 Page 11 of 44

F. ANALYSIS

i. Legislative intent behind the definition of “public

servant” under Section 2(c) of the PC Act

8. Before adverting to the rival submissions canvassed on either side,

we deem it absolutely necessary to look into the backdrop of the PC

Act. It cannot be lost sight of the fact that, the repealed Prevention

of Corruption Act, 1947 (for short, “the Act 1947”), was enacted

with the avowed object and purpose of effectively preventing bribery

and corruption. The PC Act which repeals and replaces the 1947 Act

provides for a very wide definition of the term “public servant” in

clause (c) of Section 2.

9. The Statement of Objects and Reasons, attached to the Bill by which

the PC Act was introduced by the legislature, throws light on the

intention of the legislature in providing a very comprehensive

definition of the words “public servant”. It gives the background in

which the legislation was enacted. The PC Act, which contains a

much wider definition of “public servant”, was brought in force to

purify the public administration. Para 3 of the Statement of Objects

and Reasons reads thus:

“3. The Bill, inter alia, envisages widening the scope

of the definition of the expression ‘public servant’,

incorporation of offences under Sections 161 to 165-

A of the Penal Code, 1860, enhancement of penalties

provided for these offences and incorporation of a

provision that the order of the trial court upholding the

grant of sanction for prosecution would be final if it

has not already been challenged and the trial has

commenced. In order to expedite the proceedings,

provisions for day-to-day trial of cases and

prohibitory provisions with regard to grant of stay

Crl. A. No. 2613 of 2014 Page 12 of 44

and exercise of powers of revision on interlocutory

orders have also been included.”

10. The appellants in State of Gujarat v. Mansukhbhai Kanjibhai

Shah, reported in (2020) 20 SCC 360, referred to the notes on

clauses of Prevention of Corruption Bill dated 20.02.1987 to clarify

the legislative intent behind the statute. The relevant extract has

been reproduced hereinbelow:

“36. Our attention was also drawn to the notes on

clauses of Prevention of Corruption Bill dated 20-2-

1987. Clause 2 of the Notes on Clauses in the Gazette

of India, Extraordinary, Part II, Section 2, clarifies the

legislative intent, wherein it was commented as

under:

“2. This clause defines the expressions used in

the Bill. Clause 2(c) defines “public servant”. In

the existing definition the emphasis is on the

authority employing and the authority

remunerating. In the proposed definition the

emphasis is on public duty. The definition of

“election” is based on the definition of this

expression in the Penal Code, 1860.”

(emphasis supplied)”

11. Under the repealed 1947 Act, the definition of “public servant” was

restricted to public servants as defined in Section 21 of the Indian

Penal Code, 1860 (for short, “IPC”). In order to curb bribery and

corruption not only in government establishments and departments

but also in other semi-governmental authorities and bodies and

their departments where the employees are entrusted with public

duty, a comprehensive definition of “public servant” was introduced

in Section 2(c) of the PC Act.

Crl. A. No. 2613 of 2014 Page 13 of 44

12. When the legislature has used such a comprehensive definition of

“public servant” to achieve the purpose of punishing and curbing

growing corruption in government and semi -government

departments, it would be appropriate not to limit the contents of the

definition clause by a construction which would be against the spirit

of the statute. The definition of “public servant”, therefore, deserves

a wide and purposive construction. In construing the definition of

“public servant” in Section 2(c) of the PC Act, the Court is required

to adopt a purposive approach as would give effect to the intention

of the legislature.

13. In the aforesaid context, we deem it appropriate to refer to the

decision of this Court in State of M.P. v. Ram Singh, reported in

(2000) 5 SCC 88, wherein this Court observed as follows:-

“9. The menace of corruption was found to have

enormously increased by the First and Second World

War conditions. Corruption, at the initial stages, was

considered confined to the bureaucracy which had

the opportunities to deal with a variety of State

largesse in the form of contracts, licences and grants.

Even after the war the opportunities for corruption

continued as large amounts of government surplus

stores were required to be disposed of by the public

servants. As a consequence of the wars the shortage

of various goods necessitated the imposition of

controls and extensive schemes of post -war

reconstruction involving the disbursement of huge

sums of money which lay in the control of the public

servants giving them a wide discretion with the result

of luring them to the glittering shine of wealth and

property. In order to consolidate and amend the laws

relating to prevention of corruption and matters

connected thereto, the Prevention of Corruption Act,

1947 was enacted which was amended from time to

Crl. A. No. 2613 of 2014 Page 14 of 44

time. In the year 1988 a new Act on the subject being

Act 49 of 1988 was enacted with the object of dealing

with the circumstances, contingencies and

shortcomings which were noticed in the working and

implementation of the 1947 Act. The law relating to

prevention of corruption was essentially made to deal

with the public servants, not as understood in

common parlance but specifically defined in the Act.

10. The Act was intended to make effective

provisions for the prevention of bribery and corruption

rampant amongst the public servants. It is a social

legislation intended to curb illegal activities of the

public servants and is designed to be liberally

construed so as to advance its object. Dealing with

the object underlying the Act this Court in R.S. Nayak

v. A.R. Antulay [(1984) 2 SCC 183 : 1984 SCC (Cri)

172] held: (SCC p. 200, para 18)

“18. The 1947 Act was enacted, as its long title

shows, to make more effective provision for the

prevention of bribery and corruption.

Indisputably, therefore, the provisions of the Act

must receive such construction at the hands of the

court as would advance the object and purpose

underlying the Act and at any rate not defeat it.

If the words of the statute are clear and

unambiguous, it is the plainest duty of the court

to give effect to the natural meaning of the words

used in the provision. The question of construction

arises only in the event of an ambiguity or the

plain meaning of the words used in the statute

would be self-defeating. The court is entitled to

ascertain the intention of the legislature to remove

the ambiguity by construing the provision of the

statute as a whole keeping in view what was the

mischief when the statute was enacted and to

remove which the legislature enacted the statute.

This rule of construction is so universally

accepted that it need not be supported by

precedents. Adopting this rule of construction,

whenever a question of construction arises upon

Crl. A. No. 2613 of 2014 Page 15 of 44

ambiguity or where two views are possible of a

provision, it would be the duty of the court to

adopt that construction which would advance the

object underlying the Act, namely, to make

effective provision for the prevention of bribery

and corruption and at any rate not defeat it.”

(Emphasis supplied)

14. What is relevant to note from the aforesaid is that the PC Act was

enacted after the repeal of the 1947 Act with the object of dealing

with the circumstances, contingencies and shortcomings which

were noticed in the working and implementation of the 1947 Act.

The law relating to prevention of corruption was essentially made to

deal with the public servants, not as understood in common

parlance but as specifically defined in the PC Act.

15. While holding that a deemed university would fall within the ambit

of the PC Act, a three-Judge Bench of this Court in Mansukhbhai

Kanjibhai Shah (supra) observed that it falls upon the courts to

interpret provisions of an anti-corruption legislation in a manner to

strengthen the fight against corruption. It was further added that in

case two views are possible, the court should accept the one that

seeks to eradicate corruption over the one which seeks to perpetuate

it. The relevant observations are reproduced hereinbelow:

“25. However, we are concerned herein with

interpreting the provisions of the PC Act. There is no

dispute that corruption in India is pervasive. Its

impact on the nation is more pronounced, due to the

fact that India is still a developing economy.

Presently, it can be stated that corruption in India has

become an issue which affects all walks of life. In this

context, we must state that although anti-corruption

Crl. A. No. 2613 of 2014 Page 16 of 44

laws are fairly stringent in India, the percolation and

enforcement of the same are sometimes criticised as

being ineffective. Due to this, the constitutional

aspirations of economic and social justice are

sacrificed on a daily basis. It is in the above context

that we need to resolve the issues concerned herein.

26. In Subramanian Swamy v. Manmohan Singh

[Subramanian Swamy v. Manmohan Singh, (2012) 3

SCC 64 : (2012) 1 SCC (Cri) 1041 : (2012) 2 SCC (L&S)

666] , this Court observed : (SCC p. 100, para 68)

“68. Today, corruption in our country not only

poses a grave danger to the concept of

constitutional governance, it also threatens the

very foundation of Indian democracy and the rule

of law. The magnitude of corruption in our public

life is incompatible with the concept of a socialist

secular democratic republic. It cannot be disputed

that where corruption begins all rights end.

Corruption devalues human rights, chokes

development and undermines justice, liberty,

equality, fraternity which are the core values in

our Preambular vision. Therefore, the duty of the

Court is that any anti-corruption law has to be

interpreted and worked out in such a fashion as

to strengthen the fight against corruption. That is

to say in a situation where two constructions are

eminently reasonable, the Court has to accept the

one that seeks to eradicate corruption to the one

which seeks to perpetuate it.

xxx

44. As discussed earlier, the object of the PC Act was

not only to prevent the social evil of bribery and

corruption, but also to make the same applicable to

individuals who might conventionally not be

considered public servants. The purpose under the

PC Act was to shift focus from those who are

traditionally called public officials, to those

individuals who perform public duties. Keeping the

same in mind, as rightly submitted by the learned

Senior Counsel for the appellant State, it cannot be

stated that a “deemed university” and the officials

Crl. A. No. 2613 of 2014 Page 17 of 44

therein, perform any less or any different a public

duty, than those performed by a university

simpliciter, and the officials therein.”

(Emphasis supplied)

ii. Stamp Vendors are “Public Servants”

16. In light of the observations made by this Court in Ram Singh (supra)

and Mansukhbhai Kanjibhai (supra), we now proceed to assess

whether a stamp vendor comes within the purview of a “public

servant” as defined under Section 2(c)(i) of the PC Act. The provision

reads thus:

“(c) “public servant” means, -

(i) any person in the service or pay of the

Government or remunerated by the Government

by fees or commission for the performance of any

public duty;”

17. A person would be a public servant under Section 2(c)(i) of the PC

Act if he is:

1. in the service of the Government; or

2. in the pay of the Government;

3. remunerated by fees or commission for the performance of any

public duty.

18. All three categories are independent of each other. There may be

cases where more than one of the aforesaid categories are applicable

and “or” may be read as “and”, however, the present case does not

warrant such reading.

Crl. A. No. 2613 of 2014 Page 18 of 44

19. In the present factual matrix, for the appellant to be a public servant

under Section 2(c)(i) of the PC Act, two conditions will have to be

fulfilled:

1. First, whether he is remunerated by the Government through

fees or commission; and

2. Secondly, whether such remuneration is for the performance

or discharge of a public duty.

a. Interpretation of ‘Remuneration’ in light of the Delhi

Province Stamp Rules, 1934

20. To arrive at a decision on the first aspect, what is required to be

determined is whether the discount received by the appellant is

remuneration in the terms of the expression “remunerated by the

Government by fees or commission for the performance of any duty”

under Section 2(c)(i) of the PC Act. To determine whether the

appellant was being remunerated by the Government, we must

make a reference to the 1934 Rules. Rule 1(f) defines the expression,

“licensed agent”, whereas, Rule 1(g) along with Rule 22 defines the

term “vendor”. The same reads thus:-

“(f) the expression “Licensed Agent” means and

includes every person who, for the time being holds a

licence granted under these rules, to sell stamps, but

does not include a specially licensed agent or an ex-

officio agent, as such, though an ex-officio agent may,

if duly licensed, be also a licensed agent. The

expression “licence” means a licensed agent’s

license;”

“(g) the term “vendor” includes an ex-officio agent, a

licensed agent and a specially licensed agent”

xxx

22. Vendors – There will be two classes of agent,

namely –

Crl. A. No. 2613 of 2014 Page 19 of 44

(a) ex-officio agent as vendor, defined in rule I(e).

(b) licensed or specially licensed agent as defined in

rule I(f), (g) & (h).”

Rule 26 stipulates that the Collector or any other officer

empowered by the local Government can grant license for the sale of

stamps.

21. Rule 2 stipulates that the Controller of Stamps is responsible for

supplying stamps that are required by the local Government. The

Controller of Stamps supplies stamps on the request of treasury

officers. As per Rule 3, the district treasury has been constituted as

a local depot and the sub-treasury has been constituted as a branch

depot for the custody and sale of stamps.

22. Rule 17 mandates that utmost care must be taken to ensure that no

licensed vendor is hindered from obtaining stamps from treasuries.

Furthermore, it stipulates that vendors must be permitted to

procure supplies on any day and at any hour during treasury

working hours, without unnecessary delay.

23. Further, Rule 28 states the conditions which every license granted

under the rules is subject to. Rule 28(vii) prescribes that a vendor is

bound to sell stamps on immediate payment permitted by his

license. Further, he shall not demand or accept for any stamp any

consideration exceeding the value of such stamp. Rule 28(xiii) also

mandates that the vendor shall make corresponding entries in his

vend register and get the entry attested by the purchaser. Upon

Crl. A. No. 2613 of 2014 Page 20 of 44

filling up of the register, the vendor has to deliver the same to the

Collector or any other officer deputed to receive the same.

24. Lastly, Rule 28(xx) mandates that the remuneration to the vendor

shall be in the form of discount allowed from time to time under the

orders of the local Government. In furtherance, Rule 34 states the

rule for remuneration of vendors, under the heading “Commission

allowed on Court-fee stamps”. It states that every licensed vendor of

court-fee stamps shall be entitled to discount at the rate of 1% on

stamps upto Rs. 100 in a single transaction purchased by him,

however, the total value of stamps shall neither be less than Rs. 10/-

nor in excess of a multiple of Rs. 10/-. The said rule is reproduced

hereinbelow:

“(xx) The remuneration to the vendor shall be in the

form of discount allowed from time to time under the

orders of the local Government.”

25. The 1934 Rules indicate that a licensed vendor, under the rules

obtains stamps from the treasury and the Rules empower him to

procure the stamps without any wait or delay. He is entitled to a

discount on the value of stamps at the time of purchase. The

remuneration envisaged under Rule 28(xx) alongwith Rule 34 of the

1934 Rules is in the form of ‘discount’ or ‘commission’ under the

orders of the local Government.

26. In terms of the 1934 Rules, when a licensed vendor procures stamps

from the treasury at a discounted rate which is lower than their face

value, and subsequently sells them to purchasers at their face value,

the difference between the two amounts constitutes the vendor’s

Crl. A. No. 2613 of 2014 Page 21 of 44

remuneration. For instance, if a stamp vendor purchases a stamp

with a face value of Rs. 100/- at a one percent discount, he pays Rs.

99/-. In return, he sells it to the purchaser for Rs. 100/-, i.e., the

face value of the stamp. Thus, the one percent discount by the orders

of the local Government effectively becomes the vendor’s

remuneration, representing the margin between the procurement

cost and the sale price. The rules neither envision nor indicate any

other form of remuneration.

27. The difference between the procurement price and the sale price is

by and large because of the scheme devised by the Government i.e.,

the 1934 Rules. The remuneration being received by the licensed

vendor is on the strength of the license that the vendor is holding.

Although, it is true that the liability of the stamp vendor to pay the

price less the discount is not dependent or contingent upon the sale

of the stamp papers yet the remuneration remains contingent on the

order of the local Government under Rule 28(xx) of the 1934 Rules.

28. Assuming, that no such discount was provided and the licensed

vendors were required to purchase stamps at their face value and

sell them at the same value, there would be no financial incentive

for the licensed vendors to engage in such transactions. In such a

scenario, the vendor would merely recover the amount expended on

the purchase of the stamps, without any margin of profit. The

discount, therefore, serves as a form of remuneration and operates

as a commercial incentive, enabling the vendor not only to recoup

the purchase amount but also to earn a commission in the nature

Crl. A. No. 2613 of 2014 Page 22 of 44

of the differential amount between the procurement cost and the

face value. Hence, the discount is the only form of commission.

29. At this stage, we deem it appropriate to refer to the object behind the

stamp duty. It is important to underscore that the object of the 1899

Act, along with its provisions, must be interpreted in light of the

interest of the Government in ensuring adequate remuneration to

licensed stamp vendors. While examining the relevant provisions, it

is pertinent to ask—why does the Government find it necessary to

remunerate a licensed stamp vendor at all?

30. The 1899 Act is a fiscal enactment, enacted with the primary

objective of securing revenue for the State through the imposition of

stamp duties on certain instruments. This underlying purpose is

clearly reflected in Section 3 of the 1899 Act. Section 5 further

bolsters the object by stating that where an instrument deals with

several distinct matters, the total stamp duty payable would be

equal to the combined duty that would apply if each matter were

covered by a separate instrument. In furtherance of Section 5,

Section 6 states that where duties chargeable under the different

descriptions under Schedule I are different, the instrument shall be

chargeable with the highest of them.

31. Sections 13 and 14 stipulate the mode of stamping respectively,

Section 15 reinforces the effect of non-compliance of the preceding

provisions and deems it unstamped. Section 17 provides that all

instruments chargeable with duty and executed by any person in

Crl. A. No. 2613 of 2014 Page 23 of 44

India shall be stamped before or at the time of execution. Non-

compliance of Section 17 is penalised under Section 62. Section 33

provides that every person who has authority to receive evidence

shall impound an instrument which is, in their opinion, chargeable

with duty but appears to be not duly stamped. The procedure laid

down by the statute to be followed after such impounding also

ensures that there is payment of stamp duty and the exchequer does

not incur any revenue loss.

32. Section 35 is of particular significance to the issue before this Court

as it renders instruments which are not duly stamped inadmissible

in evidence for any purpose and imposes a prohibition on such

instruments from being acted upon, registered, or authenticated.

However, the bar is removed on payment of duty and the penalty.

The Collector, again, by powers vested in him under Section 40 is

authorised to levy penalty. Section 42 reinforces that the purpose of

stamping is in payment of duty, as once the payment of duty and a

penalty is complete, the instrument is admissible.

33. The common thread running across the above-mentioned provisions

is that the Government desires that the holder of the instrument

pays appropriate stamp duty. To fulfil this objective, the Government

ensures there is sufficient availability of stamps through licensed

stamp vendors. It is for this reason the Government remunerates a

stamp vendor as he is facilitating the accessibility of stamps on

behalf of the Government, and thus the role being performed by

licensed stamp vendor is nothing short of a highly important public

Crl. A. No. 2613 of 2014 Page 24 of 44

duty, essential for ensuring the efficient collection of revenue on

behalf of the State.

b. Meaning of “Commission” under Section 194H of the

1961 Act and Section 2(c)(i) the PC Act

34. We may test the case of the appellant from another standpoint. The

appellant by relying on Ahmedabad Stamp Vendors (supra), which

was affirmed by this Court in Commissioner of Income Tax,

Ahmedabad (supra), submitted that the stamp vendors are not

agents of the State Government. It was submitted that the purchase

of stamps by the vendor from the treasury results in the transfer of

ownership to the vendor, thereby precluding the characterization of

the relationship as one of principal and agent. Consequently, the

discount on the purchase of the stamps cannot be said to be

commission neither in terms of Section 194H of the 1961 Act nor in

terms of Section 2(c)(i) of the PC Act. The appellant’s submission

although, at first glance, appears persuasive, but it does not

withstand scrutiny.

35. The High Court of Gujarat in Ahmedabad Stamp Vendors (supra)

held that in spite of the restrictions on a licensed stamp vendor

under the relevant rules, the transactions would still be a sale and

not one between a principal and agent. There is no gainsaying that

although the Government has imposed restrictions on the licensed

stamp vendors by way of the relevant rules qua the manner of

carrying on the business yet the vendors are required to purchase

the stamps on payment of price less the discount on principal-to-

principal basis.

Crl. A. No. 2613 of 2014 Page 25 of 44

36. The decision rendered by the Gujarat High Court in Ahmedabad

Stamp Vendors (supra) was also looked into by the High Court of

Uttarakhand in the case of Roorkee Stamp Vendor Association v.

State of Uttarakhand, reported in 2013 SCC OnLine Utt 3764 .

The High Court, while dealing with an identical issue – namely,

whether the amount received by stamp vendors from treasury, upon

the subsequent sale of the stamps to purchasers is by way of holding

a position of an agent of the treasury, adopted the reasoning

assigned by the Gujarat High Court. The High Court of Kerala in

Kerala State Stamp Vendors Association v. Office of the

Accountant-General, reported in 2005 SCC OnLine Ker 672 , in

agreement with the findings of Ahmedabad Stamp Vendors

(supra), took a corresponding view that the licensed stamp vendors

are not agents of the Government and are independent dealers in

stamps, though they are subject to the relevant rules in regards of

purchase and sale of stamps.

37. The definition of “public servant” cannot be understood devoid of the

context in which it came to be incorporated and the manner in which

it has been subsequently interpreted by this Court as elucidated in

the preceding section of this judgment.

38. The heart of the definition of “public servant” under Section 2(c)(i) of

the PC Act lies in the expressions “remunerated by the Government”

and “for the performance of any public duty”, and not in the mode of

remuneration, such as “fees or commission”. The ‘commission’

referred in “remunerated by the Government by fees or commission

Crl. A. No. 2613 of 2014 Page 26 of 44

for the performance of public duty” is not analogous to the

‘commission’ in Section 194H of the 1961 Act. The terms “fees” and

“commission” are merely indicative of the mode of remuneration and

not determinative of the position held by a person. Their presence or

absence does not alter the core question as to whether a person is

remunerated by the Government for the performance of any public

duty, which remains the central consideration under Section 2(c)(i)

of the PC Act.

39. The interpretation of a definition should not only avoid being

repugnant to the context but it should also be interpreted to achieve

the purpose which is sought to be served by the statute. A

construction which would defeat or may likely defeat the purpose of

the Act has to be ignored and not accepted. A definition, like any

other word in a statute, has to be read in the light of the context and

scheme of the Act.

40. The definition of “public servant” under Section 2(c)(i) can be said to

have three parts, as they are disjunctive: first, a person who is in

the service of the Government; secondly, a person who is in the pay

of the Government; thirdly, a person who is remunerated by fees or

commission for the performance of any public duty. The expression

“remunerated” in the third part has to be read in context and in line

with the expressions in the first and the second part i.e., “in the

service” and “in the pay”. The three key expressions, “in the service”,

“in the pay” and “remunerated” by the Government belong to the

same genus and have the same flavour. In the first two parts, a

person is rendering his services for the Government which implicitly

Crl. A. No. 2613 of 2014 Page 27 of 44

means discharging a public duty. Whereas, in the third part, even

though a person is not rendering his services for the Government

but is being remunerated for discharging a public duty. In this

context, the terms “fees or commission” must be construed so as to

give full effect to the definition and the other provisions of the

statute.

41. Further, the term “commission” as used and understood in the

context of Section 194H of the 1961 Act is not stricto sensu similar

to its usage in Section 2(c)(i) of the PC Act. When a person is in

service of the Government, as is contemplated under the first part

of Section 2(c)(i), he is said to be in a master-servant relationship

where the employer employs the person on the basis of salary.

Whereas, in the second part, a person may not be a regular employee

but is receiving salary from his master. A five-Judge Bench of this

Court in M. Karunanidhi v. Union of India, reported in (1979) 3

SCC 431, although in the context of Section 21, Twelfth, of the IPC,

has interpreted the word ‘pay’ as implying that a person is getting

salary, compensation, wages or any amount of money yet a

relationship of master-servant need not exist in all cases.

42. Further, as the master-servant or principal-agent relationship has

already been envisaged under the first part, the legislature could not

have intended to address it again under the third part. The structure

of the definition reduces the emphasis on the strictness of the

relationship between the Government and the public servant, while

placing greater focus on the performance of a public duty. It is

Crl. A. No. 2613 of 2014 Page 28 of 44

important to note that, the first two parts imply that the individual

is rendering services directly for the Government. Whereas, the last

part suggests that even where the services are not rendered ‘for’ the

Government, the Government may nevertheless remunerate the

person for performing a public duty.

43. Where the wording of a statutory provision indicates that the

legislature has consciously attributed varying degrees of significance

to different interpretative elements such as the nature of the

relationship or the duty performed, the courts are obliged to adhere

to that legislative determination and interpret the provision in a

manner that reflects the intended statutory scheme . While

interpreting a statute, it is essential not only to consider the words

used but also to examine the Statement of Objects and Reasons, as

it provides the background against which the legislation was

enacted. The legislature introduced a comprehensive definition of

“public servant” with the intent to punish and curb the menace of

corruption. In such circumstances, it would be improper to construe

the definition in a manner that limits its scope, thereby defeating

the very essence and purpose of the statute.

44. It is an important rule of interpretation that every interpretation of

a statute must be undertaken by considering the statute in its

entirety, the prior state of the law, other statutes in pari materia, the

general scope and purpose of the legislation, and the mischief that

the legislature intended to address.

Crl. A. No. 2613 of 2014 Page 29 of 44

iii. Public Duty as the determinant of status of Public

Servant

45. We now proceed to consider the case of the appellant on the second

aspect of the definition of a public servant i.e., whether the

remuneration received by a licensed stamp vendor is for the

performance or discharge of a public duty. As we have discussed in

the preceding section, it is the nature of duty which is the

determining factor in deciding whether a person qualifies to be a

public servant and not the manner of appointment or mode of

remuneration. The primary test of qualification for inclusion in the

definition of “public servant” in the third part of Section 2(c)(i) is

whether the concerned person is performing any public duty. The

commonality across the sub-clauses of Section 2(c) is that all the

persons therein are performing a ‘public’ duty. Section 2(b) defines

“public duty” as follows:

(b) “public duty” means a duty in the discharge of which

the State, the public or the community at large has an

interest.”

46. Once the nature of performance of duties gets crystallized, any

person remunerated by the Government for the performance of any

public duty or who holds an office by virtue of which he is authorized

or required to perform any public duty, is a “public servant” within

the meaning of the term defined under Section 2(c).

47. This Court in Mansukhbhai Kanjibhai Shah (supra), had held that

the emphasis under Section 2(c) of the PC Act is on the public duty

performed by him and not on the position held by an individual. The

relevant observations are reproduced hereinbelow:

Crl. A. No. 2613 of 2014 Page 30 of 44

“34. On a perusal of Section 2(c) of the PC Act, we may

observe that the emphasis is not on the position held by

an individual, rather, it is on the public duty performed by

him/her. In this regard, the legislative intention was not to

provide an exhaustive list of authorities which are covered,

rather a general definition of “public servant” is provided

thereunder. This provides an important internal evidence

as to the definition of the term “university”.

xxx

44. As discussed earlier, the object of the PC Act was not

only to prevent the social evil of bribery and corruption, but

also to make the same applicable to individuals who might

conventionally not be considered public servants. The

purpose under the PC Act was to shift focus from those

who are traditionally called public officials, to those

individuals who perform public duties. Keeping the same

in mind, as rightly submitted by the learned Senior

Counsel for the appellant State, it cannot be stated that a

“deemed university” and the officials therein, perform any

less or any different a public duty, than those performed

by a university simpliciter, and the officials therein.”

(Emphasis supplied)

48. In G. Krishnegowda v. State of Karnataka, reported in 2021 SCC

OnLine Kat 15332, the petitioner therein was working as a project

manager in a society registered under the provisions of the

Karnataka Societies Registration Act, 1960, whose principal object

was to develop skills in construction and to undertake civil

construction works assigned by the Government. On receipt of a

complaint of possession of disproportionate assets as against the

known sources of his income, an FIR was registered. The petitioner

sought quashing of the FIR on the ground that respondent-authority

does not have the power to register a case against the petitioner as

he is not a public servant. The High Court held that having regard

to the nature of work carried on by the petitioner he would fall within

Crl. A. No. 2613 of 2014 Page 31 of 44

the definition of the word “public duty” as defined under the PC Act.

Hence, even if an individual does not qualify as a public servant

under the PC Act, they may still fall within its ambit if they are

engaged in the discharge of any public duty . The relevant

observations are reproduced hereinbelow:

“13. From the reading of the definition of the word ‘public

servant as found in the P.C. Act, it is very clear that a

person who holds an office by virtue of which he is

authorized or required to perform any public duty, and any

person or employee of any institution if it has been

receiving or if it has received any financial assistance from

the State or Central Government, shall be considered as a

public servant. The explanation to Section 2(c) of the P.C.

Act would further go to show that such a person may be

appointed by the Government or not. Therefore, a public

servant need not be a Government/civil servant, but a

Government/civil servant is always a public servant.

xxx

20. Be that as it may, having regard to the fact that the

Nirmithi Kendra in which the petitioner is employed has

been receiving funds from the State and the Central

Government and taking into consideration the definition of

the word ‘public servant’ as found in the P.C. Act, it cannot

be but said that the petitioner is a public servant. Even if

a person is not a public servant, but by virtue of his office

if he is discharging public duty, then he is covered under

the ambit of the P.C. Act.

21. Corruption in our country is a growing menace and

P.C. Act being a welfare legislation is required to be

interpreted keeping in mind the object and spirit of the

statute. In furtherance of the fight against corruption a

broad interpretation to the provisions of this statute is

required to be given and the arms of this Act is required to

be extended to the maximum. The offences under the P.C.

Act can be invoked not only against a public servant but

also against a person, who by virtue of his office has been

discharging ‘public duty’[...]”

(Emphasis supplied)

Crl. A. No. 2613 of 2014 Page 32 of 44

49. The case of the appellant has tested positive on both aspects of the

definition of a public servant under Section 2(c)(i) of the PC Act. The

1934 Rules envisage that the nascent discount eventually matures

into a form of remuneration. Further, the purpose of securing stamp

duty fortifies the motive behind the efforts of the Government to

remunerate stamp vendors. Thus, the appellant, at the relevant

time, was being remunerated by the Government. Undoubtedly, the

appellant was discharging a duty in which both the State and the

public have an interest, which, nonetheless, brings him within the

ambit of a public servant as defined under the PC Act.

iv. Legality of appellant’s conviction

50. We shall now consider whether the prosecution successfully

discharged its burden of establishing its case against the appellant

under Sections 7 and 13(1)(b) respectively beyond reasonable doubt.

The oral evidence of the complainant reveals that on 09.12.2003,

after lodging the complaint at the ACB office, at about 2:45 PM, he

proceeded with the raiding team to the Office of Sub-Registrar,

Janakpuri. At about 3:45 PM, he attempted to purchase a stamp

paper of Rs. 10/- from the appellant, who demanded Rs. 12/ -,

stating that it was his usual charge. As per the directions of the Raid

Officer, the complainant then handed over the smeared GC Notes

from his shirt pocket, which the appellant accepted with his right

hand. At this point, the complainant failed to recollect as to where

the appellant had kept the money thereafter. He added that the ACB

officials apprehended the appellant, and the Raid Officer took a wash

Crl. A. No. 2613 of 2014 Page 33 of 44

of the right hand of the appellant, which changed the colour of the

solution.

47.1 At this stage, the Public Prosecutor sought to cross-examine the

complainant, alleging that as the complainant was resiling from his

earlier statement he be declared as a hostile witness. During the

cross-examination by the Public Prosecutor, the complainant revealed

further details by stating that the Raid Officer and Investigating

Officer (IO) had recorded all proceedings at the spot. The Raid Officer

had instructed the panch witness to stay close to the complainant,

listen to the conversation, observe the transaction, and give a pre-

assigned signal if a demand was made by the appellant. He further

added that when the complainant handed over the smeared GC Notes,

the appellant stamped the back of the stamp paper and made an entry

in his register. The panch witness then gave the signal, and the

raiding team arrived and recovered the GC Notes from the appellant’s

register.

47.2 The Raid Officer testified that on 09.12.2003, he received a complaint

alleging that a stamp vendor was selling stamp papers of the value

Rs. 10/- for Rs. 12/-. After explaining the procedure of the raid, he

instructed the complainant and the panch witness to stay close and

tender the excess amount of Rs. 2/- only if demanded. The panch

witness was to signal completion of transaction by moving his hand

over his head. He stated that the IO and driver stayed behind while

the rest proceeded to the Office of Sub-Registrar, Janakpuri. At 4 PM,

the panch witness gave a signal, and the raiding team rushed to the

Crl. A. No. 2613 of 2014 Page 34 of 44

spot. The panch witness pointed out that the money accepted was

lying on the appellant’s register. After the seizure, the witness called

the IO and handed over the copy of the raid report, seizure memos,

exhibits, and the appellant. In his cross-examination, the panch

witness deposed that he did not hear the conversation regarding the

demand and payment of the excess Rs. 2/-. He admitted that the

currency notes were lying on the register when he reached the spot

and were not recovered from the body or clothes of the accused.

47.3 The IO deposed that after leaving the ACB office, he stayed behind

while the Raid Officer, the complainant, the panch witness and others

proceeded for the raid. At around 7:15 PM, the Raid Officer called him

to the location and handed over the documents. In cross-examination,

the witness admitted that the seizure memo does not mention that an

attachie, sale register, and various stamp papers were seized from the

appellant’s seat. He also admitted that he was not present when the

appellant was apprehended and searched by the Raid Officer. The

seizure memo was prepared by him after the Raid Officer handed over

the site to him as the IO, and he was unable to say when the raid got

concluded. He further deposed that the seizure memo pertaining to

the currency notes records the time of seizure as 4:15 PM.

47.4 Following this, the panch witness in his examination-in-chief deposed

that on 09.12.2003, he was deputed as a panch witness in the ACB.

He, alongwith the complainant, Raid Officer, and other ACB officials

left for the Sub-Registrar Office, Janakpuri. The Raid Officer had

directed him to stay close to the complainant and overhear the

Crl. A. No. 2613 of 2014 Page 35 of 44

conversation with the stamp vendor. At this stage, the prosecutor

sought permission to cross-examine him. On being cross-examined,

he stated that the GC Notes of Rs. 10/- and Rs. 2/- were recovered

from the accused but he could not recall whether he had informed the

Raid Officer about any demand for Rs. 12/- instead of Rs. 10/- for a

stamp paper. In his cross-examination by the counsel for the

appellant, he reiterated that he does not recollect whether the

appellant demanded for Rs. 12/- for a stamp paper of Rs. 10/-. He

admitted that he was very close to the complainant at the time of the

transaction.

51. In C.K. Damodaran Nair v. Govt. of India reported as (1997) 9

SCC 477, this Court, although interpreting the term “accept” in the

context of the 1947 Act, observed that “accept” means to take or

receive with a consenting mind. In contrast, “obtain” was

understood to imply securing or gaining something as a result of a

request or effort. In both instances, a demand or request by the

receiver is a prerequisite for establishing an offence under Sections

7 and 13(1)(d) of the PC Act.

52. It is well-settled that mere recovery of tainted money, by itself, is

insufficient to establish the charges against an accused under the

PC Act. To sustain a conviction under Sections 7 and 13(1)(d) of the

Act respectively, it must be proved beyond reasonable doubt that the

public servant voluntarily accepted the money, knowing it to be a

bribe. The courts have consistently reiterated that the demand for a

bribe is sine qua non for establishing an offence under Section 7 of

the PC Act.

Crl. A. No. 2613 of 2014 Page 36 of 44

53. A five-Judge Bench of this Court in Neeraj Dutta v. State

(Government of NCT of Delhi) , reported in (2023) 4 SCC 731,

categorically held that an offer by bribe-giver and the demand by the

public servant have to be proved by the prosecution as a fact in issue

for conviction under Sections 7 and 13(1)(d)(i) and (ii) of the PC Act.

Mere acceptance of illegal gratification without proof of offer by

bribe-giver and demand by the public servant would not make an

offence under Sections 7 and 13(1)(d)(i) and (ii) of the PC Act. The

relevant observations are reproduced hereinbelow:

“88.4. (d) In order to prove the fact in issue, namely, the

demand and acceptance of illegal gratification by the

public servant, the following aspects have to be borne in

mind:

(i) if there is an offer to pay by the bribe-giver without there

being any demand from the public servant and the latter

simply accepts the offer and receives the illegal

gratification, it is a case of acceptance as per Section 7 of

the Act. In such a case, there need not be a prior demand

by the public servant.

(ii) On the other hand, if the public servant makes a

demand and the bribe-giver accepts the demand and

tenders the demanded gratification which in turn is

received by the public servant, it is a case of obtainment.

In the case of obtainment, the prior demand for illegal

gratification emanates from the public servant. This is an

offence under Sections 13(1)(d)(i) and (ii) of the Act.

(iii) In both cases of (i) and (ii) above, the offer by the bribe-

giver and the demand by the public servant respectively

have to be proved by the prosecution as a fact in issue. In

other words, mere acceptance or receipt of an illegal

gratification without anything more would not make it an

offence under Section 7 or Sections 13(1)(d)(i) and (ii),

respectively of the Act. Therefore, under Section 7 of the

Act, in order to bring home the offence, there must be an

Crl. A. No. 2613 of 2014 Page 37 of 44

offer which emanates from the bribe -giver which is

accepted by the public servant which would make it an

offence. Similarly, a prior demand by the public servant

when accepted by the bribe-giver and in turn there is a

payment made which is received by the public servant,

would be an offence of obtainment under Sections

13(1)(d)(i) and (ii) of the Act.”

(Emphasis supplied)

54. It was further explained by this Court in P. Satyanarayana Murthy

v. State of A.P., reported in (2015) 10 SCC 152, as follows:

“23. The proof of demand of illegal gratification, thus, is

the gravamen of the offence under Sections 7 and

13(1)(d)(i) and (ii) of the Act and in absence thereof,

unmistakably the charge therefor, would fail. Mere

acceptance of any amount allegedly by way of illegal

gratification or recovery thereof, dehors the proof of

demand, ipso facto, would thus not be sufficient to bring

home the charge under these two sections of the Act. As a

corollary, failure of the prosecution to prove the demand

for illegal gratification would be fatal and mere recovery of

the amount from the person accused of the offence under

Section 7 or 13 of the Act would not entail his conviction

thereunder.”

(Emphasis supplied)

55. From the above exposition of law, it may be safely concluded that

mere possession and recovery of tainted currency notes from a

public servant, in the absence of proof of demand, is not sufficient

to establish an offence under Sections 7 and 13(1)(d) of the PC Act

respectively. Consequently, without evidence of demand for illegal

gratification, it cannot be said that the public servant used corrupt

or illegal means, or abused his position, to obtain any valuable thing

or pecuniary advantage in terms of Section 13(1)(d) of the PC Act.

Crl. A. No. 2613 of 2014 Page 38 of 44

56. The present case is not one of an “offer to pay by the bribe-giver”

where, in the absence of any demand from the public servant, the

mere acceptance of illegal gratification would constitute an offence

under Section 7 of the PC Act. The expression “offer” indicates that

there is a conveyance of an intention to give, which must be

communicated and understood by the recipient, leading to meeting

of minds. Consequently, the offer is accepted. For such an

acceptance to constitute an offence under Section 7, there must be

clear and cogent evidence establishing that the public servant was

aware of the offer and accepted it voluntarily, knowing it to be illegal

gratification. In other words, even where there is no express demand,

the bribe-giver and the bribe-taker must be shown to have been ad

idem as regards the factum of offer of bribe.

57. By applying the abovementioned principles to the evidence on

record, we are of the considered view that, having regard to material

inconsistencies in the testimony of the complainant and the

testimony of the panch witness, the allegation of demand by the

appellant herein does not emerge clearly, let alone being proved

beyond reasonable doubt.

58. Undoubtedly, when dealing with a wholly reliable witness, the court

faces no difficulty in reaching a conclusion, it may convict or acquit

solely on the basis of such testimony, provided it is free from any

suspicion of interestedness, incompetence, or subordination.

Similarly, in the case of a wholly unreliable witness, the court again

faces no ambiguity in discarding the testimony. The real challenge

arises when the witness is neither wholly reliable nor wholly

Crl. A. No. 2613 of 2014 Page 39 of 44

unreliable. In such situations, the court must proceed with caution

and seek corroboration in material particulars, whether through

direct or circumstantial evidence. The court’s duty to act on the

testimony of a single witness arises when it is satisfied, upon a

careful perusal of the testimony, that it is free from all taints and

suspicions. [See: Vedivelu Thevar v. State of Madras, 1957 SCC

OnLine SC 13; State of Madhya Pradesh v. Balveer Singh, 2025

SCC OnLine SC 390]

59. Although, it cannot be said that the complainant did not support the

prosecution’s case at all, yet there were lapses on his part in

disclosing significant facts alongwith material inconsistencies

between his testimony and that of the panch witness. The testimony

of the complainant and the Raid Officer reveal that the panch

witness was instructed to accompany the complainant so as to

enable the raiding team to apprehend the appellant as soon as he

makes a demand for illegal gratification. The panch witness admitted

that he was in a close proximity to the complainant and the

appellant at the time of transaction. The panch witness further

deposed that there was no other person on the counter of the

appellant and thus the possibility of any exchange of communication

between the complainant and the appellant being not heard properly

by the panch witness is also negligible.

60. The necessity and desirability of a panch witness is particularly to

be aware of the transactions and to facilitate in carrying out the raid.

On being questioned about a demand of Rs. 12/- being made by the

appellant, the panch witness lacked recollection on whether he had

Crl. A. No. 2613 of 2014 Page 40 of 44

informed the Raid Officer about any demand for Rs. 12/- instead of

Rs. 10/-. Further, the Raid Officer deposed that he did not hear the

conversation regarding the demand and acceptance of Rs. 2/-. The

prosecution did not examine any other witness on the allegation of

demand by the appellant.

61. Further, the panch witness, when confronted with a specific query

regarding the demand, deposed that he could not recollect whether

the appellant had demanded Rs. 12/- for a stamp paper valued at

Rs. 10/-. He also did not indicate the presence of any implied

demand.

62. We also find ourselves compelled to express doubt regarding the

unexplained delay of approximately three hours between the

apprehension and seizure of the appellant and the calling of the IO

to the spot. According to the complainant and the Raid Officer, they

arrived at the Office of the Sub-Registrar at around 3:45 PM, and

the Raid Officer received the pre-arranged signal from the panch

witness at approximately 4:00 PM. The seizure memo of the currency

notes shows the time of seizure as 4:15 PM. However, the IO stated

that he was called to the scene by the Raid Officer only at 7:15 PM.

Further, the seizure memo of the stamp papers and sale register do

not mention the time of seizure.

63. Further, we are conscious of the fact that only two currency notes

were recovered, both of which had been smeared with

phenolphthalein powder. Notably, even accepting the prosecution’s

case for the sake of argument, the appellant was lawfully entitled to

Crl. A. No. 2613 of 2014 Page 41 of 44

receive Rs. 10/- for the stamp paper, irrespective of any demand for

bribe. Since, the Rs. 10/- note itself was tainted it becomes difficult

to determine whether the change in the colour of the solution was

triggered by the handling of the Rs. 10/- note or the Rs. 2/- note.

Hence, the mere turning of the solution pink cannot, by itself,

establish the acceptance of illegal gratification.

v. Presumption under Section 20 of the PC Act

64. Insofar as the presumption under Section 20 of the PC Act is

concerned, such presumption is drawn only qua the offence under

Sections 7 and 11 respectively and not qua the offence under Section

13(1)(d) of the PC Act. The presumption is contingent upon the proof

of acceptance of illegal gratification to the effect that the gratification

was demanded and accepted as a motive or reward as contemplated

under Section 7 of the PC Act. Such proof of acceptance can follow

only when the demand is proved.

65. In that case, the prosecution evidence alone cannot be considered

for the purpose of coming to the conclusion. The evidence led by the

prosecution and, the suggestions made by the defence witnesses, if

any, are also required to be considered. It is then to be seen as to

whether the total effect of the entire evidence led before the court is

of a nature by which the only conclusion possible was that the public

servant accepted the amount. If the answer is in affirmative, then

alone it can be held that the prosecution established the case beyond

reasonable doubt.

Crl. A. No. 2613 of 2014 Page 42 of 44

66. Undoubtedly, the presumption under Section 20 arises once it is

established that the public servant accepted the gratification.

However, in determining whether such acceptance occurred, the

totality of the evidence led at the trial must be appreciated. The

evidence led by the prosecution, the suggestions made by the

defence witnesses, if any, the entire record is required to be

considered. Only if the cumulative effect of all the evidence is such

that the sole possible conclusion is that the public servant accepted

the gratification can it be said that the prosecution has established

its case beyond reasonable doubt.

67. On examination of the entire evidence, we are of the opinion that the

prosecution has failed to establish beyond all reasonable doubt, the

demand of bribe and its acceptance, in a trap laid by the ACB. In

such circumstances, there is no question of a presumption under

Section 20. Consequently, we find ourselves compelled to conclude

that it would be entirely illegal to uphold the conviction of the

appellant under Sections 13(1)(d)(i) and (ii) read with Section 13(2)

of the Act.

G. CONCLUSION

68. In light of the aforesaid discussion, we have reached the following

conclusion:

68.1 The legislature has used a comprehensive definition of

“public servant” to achieve the purpose of punishing and

curbing the growing menace of corruption. Keeping this

intention of the legislature in mind, we are of the view that

the definition of “public servant” as defined under the PC

Crl. A. No. 2613 of 2014 Page 43 of 44

Act should be given a purposive and wide interpretation so

as to advance the object underlying the statute.

68.2 It is the nature of duty being discharged by a person which

assumes paramount importance when determining whether

such a person falls within the ambit of the definition of

public servant as defined under the PC Act.

68.3 Stamp vendors across the country, by virtue of performing

an important public duty and receiving remuneration from

the Government for the discharge of such duty, are

undoubtedly public servants within the ambit of Section

2(c)(i) of the PC Act.

68.4 In the case at hand, the appellant was eligible for receiving

discount on the purchase of stamp papers owing to the

license that he was holding. Further, the discount is

traceable to and is governed by the 1934 Rules framed by

the State Government. Thus, the appellant, without a doubt,

could be said to be “remunerated by the government” for the

purposes of Section 2(c)(i) of the PC Act.

68.5 Further, the prosecution has failed in establishing the

allegation of demand for illegal gratification and acceptance

thereof beyond reasonable doubt. Therefore, the conviction

of the appellant for the offences under Section 7 and 13(1)(d)

read with Section 13(2) of the PC Act cannot be sustained

and is, thus, liable to be set aside.

Crl. A. No. 2613 of 2014 Page 44 of 44

69. In the result, the appeal succeeds and is hereby allowed. The

conviction and sentence of the accused, as awarded by the Trial

Court and affirmed by the High Court is set aside.

70. Bail bond(s), if any, shall stand discharged.

71. Pending application(s), if any, shall also stand disposed of.

…………………………..J.

(J.B. PARDIWALA)

…………………………..J.

(R. MAHADEVAN )

New Delhi,

2

nd May, 2025