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PETITIONER:

C. R. BANSI

Vs.

RESPONDENT:

STATE OF MAHARASHTRA

DATE OF JUDGMENT:

15/12/1970

BENCH:

SIKRI, S.M.

BENCH:

SIKRI, S.M.

BHARGAVA, VISHISHTHA

DUA, I.D.

CITATION:

1971 AIR 786 1971 SCR (3) 236

1970 SCC (3) 537

CITATOR INFO :

RF 1977 SC1772 (14)

R 1979 SC1495 (7)

R 1984 SC 684 (19)

ACT:

Prevention of Corruption Act (2 of 1947), ss. 5(3) and 6-

Scope of

HEADNOTE:

The appellant, who was an income-tax Officer, was, dismissed

from service and against the order of dismissal he filed an

appeal to the President of India. Meanwhile, he was charged

under the Prevention of Corruption Act, 1947, with the

offence of habitually accepting bribes. Five instances

were offered by the prosecution in evidence against him to

prove the charge. The trial court accepted the evidence

regarding two instances, and convicted the appellant under

s. 5(2) read with ss. 5(1)(d) and 5(3) of the Act drawing-

the presumption under s. 5.(3) (before its amendment in

1964) against him on the ground that he was in possession of

assets disproportionate to his known sources of income. He

was sentenced to rigorous imprisonment for three years and

to pay a fine of Rs. 1,25,000/-, to be recovered from the

properties siezed from him. The High Court accepted the

evidence regarding one more instance and confirmed the

conviction and sentence.

In appeal to this Court,

HELD : (1) The trial is not bad for lack of santcion under

s. 6 of the Act. The appellant ceased to be a public

servant when the order of dismissal was passed. The fact

that an appeal was pending would not make him a public

servant. Sanction is necessary only when the person is

employed in connection with the affairs of the Union and not

when he was employed. [241 D-F]

(2)Since the charge was one of habitually accepting bribes

it was not necessary that specific instances of taking

bribe should be given in the charge. [241 G]

Biswabhusan Naik v. State of Orissa, [1955] 1 S.C.R. 92,

followed.

(3) The appellant had property disproportionate to his

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known sources of income and the presumption under s. 5(3) of

the Act was rightly drawn against him. Failure to establish

any of the offences in s. 5(1) (a) to (d) is irrelevant for

sustaining a conviction based on the presumption.

Biswabhusan Naik v. State of Orissa, [1955] 1 S.C.R. 92 and

C. S.D. Swamy v. State, [1960] 1 S.C.R. 461, followed.

Surajmal Singh v. State of Uttar Pradesh, [1961] 2 S.C.R.

971 and R. S. Pandit v. State of Bihar, [1963] Supp. 2

S.C.R., 652, referred to and explained. [245 C]

(4) In view of the fact that the appellant had undergone

the sentence for about four months and a large fine was

imposed on him, the ends of justice would be met if the

sentence is reduced to one already undergone while

maintaining the sentence of fine. [246 B-C]

237

JUDGMENT:

CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No. 834 of

1965.

Appeal by special leave from the judgment and order dated

October 19, 24, 1964 of the Bombay High Court in Criminal

Appeal No. 1330 of 1964.

A. S. R. Chari, R. Nagaratnam, Vineet Kumar and Shyamala

Pappu, for the appellant.

Debabrata Mukherjee, H. R. Khanna and S. P. Nayar, for the

respondent.

The Judgment of the Court was delivered by

Sikri, J. -- This is an appeal by special leave against the

judgment and order of the High Court of Judicature at Bombay

dismissing the appeal of the appellant against the

conviction recorded by the Special Judge for Greater Bombay.

The appellant was convicted by the Special Judge under s.

5(2), read with s. 5 1 (1 ) (a) X (d) and s. 5 (3 ), of the

Prevention of Corruption Act, 1947 (11 of 1947)-hereinafter

referred to as the Act and sentenced to suffer rigorous

imprisonment for three years and to pay a fine of Rs.

1,25,000/-, in default of payment of fine to suffer further

rigorous imprisonment for one year. The Special Judge

further directed that the amount of fine be recovered from

the properties seized.

The following charge was framed against the appellant:

" That you, while functioning as (a) Income-

tax Officer, from about 1st April 1947 to

November 1954 at Jalgaon Dhulia, Godhra and

Mahansa (b) as Inspector of Income-tax from

November 1954 to January 1958 at Surat and

Broach, (c) as Incometax Officer from January

1958 to the end of November 1961 at Bhavnagar,

Dhulia, Amraoti and Ratnagiri, habitually

accepted or obtained and habitually agreed to

accept or attempted to obtain gratification

other than legal remuneration and obtained for

yourself pecuniary advantage by corrupt and

illegal means or by otherwise abusing your

position as a public servant, with the result

that, during the said period you came in

possession of assets of the value of about Rs.

2,01,080/- which were disproportionate to your

known sources of income for which you could

not satisfactorily account and you thereby

committed the offence of criminal misconduct

punishable under subs. (2) read with section

(1) (a), (d) & (3) of section 5 of Act IT of

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1947, the Prevention of Corruption Act, 1947,

and within the cognizance of this Court."

238

The case of the prosecution before the Special Judge was

that the appellant was habitually corrupt, and wherever he

was posted he used to develop personal contacts with the

assessees, whose cases were pending before him and in his

talk with them he tried to impress upon them that they were

likely to be heavily taxed; he used to create a favourable

psychological background and taking advantage of the same

tried to screw out money from them; if the assessee did not

accept his proposal or proved to be smarter, he used to

harass him by various methods. The prosecution sought to

establish the charge against him under s. 5(1)(a) of the

Act by leading evidence of five instances:-

(i) He obtained from the witness Gopaldas an

amount of Rs. 3,000/- as a loan and

subsequently converted it as his personal

gratification for finalising income-tax cases

of his firm.

(ii) He demanded an illegal gratification (

Rs. 10,000/- from the witness Gopaldas to show

him were pending before him.

(iii) He attempted to obtain bribe from P.W.

7-

Motilal Bansgopal, whose income-tax

proceedings were pending before him.

(iv) He atempted to obtain bribe from the

assessee P.W. 9, Somchand Khimji, whose

income-tax proceedings were pending before

him.

(v) He also made a demand of bribe of Rs.

400/ to Rs. 500/- from P.W. 93 Gulabdas

Kisondas Bhatia of Dharanyaon.

Before the Special Judge the prosecution also relied on the

presumption arising under s. 5(3) of the Act as the accused

was found to be in possession of assets worth about Rs.

2,01,080 which were disproportionate to his known sources of

income.

The learned Special Judge, in a very detailed and lengthy

judgment, held that it was not proved that the appellant had

obtained Rs. 3000/- from Gopaldas representing that he

wanted the amount as a hand-loan for taking delivery of the

car. He further held that it was not proved that the

appellant demanded bribe of Rs. 10,000/- from him as a

motive for doing him favour in the disposal of his wealth

tax cases. Regarding P.W. 7. Motilat Bansgopal. the Special

Judge held that the accused had entertained a corrupt motive

in asking the assessee P.W. 7to see him at his residence,

and this circumstance could be considered against him in

considering the charge for the offence of

239

habitually being corrupt. Regarding Somchand, P.W. 9, the-

Special Judge held that the appellant had made an implied

demand of bribe and had a guilty conscience. Regarding-

Gulabdas, he held that the allegation regarding demand of

bribe from P.W. 93, Gulabdas, had not been proved. He

summarised. the findings thus

"Thus out of specific instances the

prosecution has established only two and it

has been proved that the accused had made an

implied demand of bribe from P.W. 9, Somchand

and he had also asked P.W. 7, Motilal to come

to his residence in connection with the delay

in filing the return. The second instance

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though does not establish any demand of bribe

as such, it does prove the proclivity of the

mind of the accused and a corrupt tendency and

would support the prosecution version."

He further held that "the two instances proved will not

themselves be sufficient to prove habit of bribe taking and

the question is whether considering all the matters before

the court it can be held that the accused is guilty of

criminal misconduct and if yes, of what category." He

further held that the appellant could be convicted on the

strength of presumption arising under s. 5 (3).

The High Court repelled the contention of the appellant that

no presumption arose under s. 5 (3) of the Act because no

specific instances had been held to be proved and, at any

rate, they did not amount to an offence. The High Court

distinguished the cases of R. S. Pandit v. State of

Bihar,(1) and Surajpal Singh v. The State of Uttar

Pradesh(2). The High Court further observed that the trial

Judge had accepted the evidence regarding two instances

while it was prepared to accept the instance involving

Gopaldas also. The High Court generally agreed with the

finding regarding disproportionate assets and disbelieved

the explanation offered by the appellant.

Before we deal with the merits of the case, we shall taker

up two preliminary points raised by the learned counsel for

the appellant, Mr. Chari. He urged that as sanction had not

been given for prosecuting the appellant the whole trial was

bad. He said that the search of the appellant's house took

place on November 4, 1961, and on June 27, 1962, he was

dismissed' from service by the Commissioner of Income-tax.

On July 30, 1962, charge-sheet was filed in the court of

Special Judge. On

(1) [1963] Suppl. 2 S.C.R. 652.

(2) [1961] 2 S.C.R. 971

240

"September 21, 1962, the appellant submitted an appeal to

the President of India and the President was pleased to,

convert the order of dismissal into one of the removal. The

learned counsel contends that I pending the appeal the

appellant should have been deemed to be in service and,

therefore deemed to be in service on July 30, 1962. A

similar point was raised before the Special Judge and he

repelled the contention in the following terms .

"For requiring a sanction to be taken before

taking cognizance of an offence against a

person, he must be in actual employment of the

State. A mere right of appeal will not invest

him with that status. Moreover, a person may

have right of appeal, but he may not exercise

the same and may not file the appeal. It is

purely within his discretion and the act of

taking cognizance which is the course of law

would not be made dependent upon such

arbitrary and discretionary alternatives held

by a person."

The Special Judge also referred to rule 23 of the Central

Civil Services (Classification, Control and Appeal) Rules,

1957, and the explanation thereto in which it is stated :

"In this rule the expression 'member of a

Central Civil Service' includes a person who

has ceased to be a member of the service."

This explanation was also relied on before us. Regarding

the explanation the learned Special Judge came to the

conclusion that the explanation was restricted to that

particular rule for giving the dismissed servant a right to

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prefer an appeal.

We agree with the conclusion of the learned Special Judge.

Section 6 of the Act reads as follows :

"Previous sanction necessary for prosecution.

(1) No Court shall take cognizance of an

offence punishable under section 161 or

section 164 or section 165 of the Indian Penal

Code (Act 45 of 1860), or under sub-section

(2) of section 5 this Act, alleged to have

been committed by a public servant, except

with the previous sanction,

(a) in the case of a person who is employed

in connection with the affairs of the Union

and is not removable from his office save, by

or with the sanction of the Central

Government, of the Central Government.

241

(b) in the case of a person who is employed

in connection with the affairs of a State and

is not removable from the office save by or

with the sanction of the State Government, of

the State Government;

(c) in the case of any other person, of the

authority competent to remove him from his

office.

(2) Where for any reason whatsoever any

doubt arises whether the previous sanction as

required under sub-section (1) should be given

by the Central or State Government or any

other authority, such sanction shall be given

by that Government or authority which would

have been competent to remove the public ser-

vant from his office at the time when the

offence was alleged to have been committed."

It seems to us that the person must be employed in

connection with the affairs of the Union in sub-cl. (a) and

with the affairs of the State in sub-cl. (b) The case of

the appellant would be covered in sub-cl. (a) because he had

been employed in connection with the affairs of the Union.

But the sub-section contemplates that the person must be

employed in connection with the affairs of the Union and not

that he was employed with the affairs of the Union. The

policy underlying s. 6, and similar sections, is that there

should not be unnecessary harassment of public servants.

But if a person ceases to be a public servant the question

of harassment does not arise. The fact that an appeal is

pending does not make him A public servant. The appellant

ceased to be a public servant when the order of dismissal

was passed. There is no force in the contention of the

learned counsel and the trial cannot be held to be bad for

lack of sanction under s. 6 of the Act.

The other preliminary point which the learned counsel raised

was that the charge was defective. We have already set out

the charge. It is true that there are no instances given in

the charge. But as the charge is of habitually accepting

the. bribe it is no,, necessary that the various instances

should have been mentioned. It was expressly so held by this

Court in Biswabhusan Naik v. The State of Orissa(1). This

Court overruled a similar point in the following words:

"But no particulars need be set out in the

charge in such a case because the offence

under section 5(1) (a) does not consist of

individual acts of bribe as in section 161 of

the Indian Penal Code but is of a general

character. Individual instances may be useful

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to prove

(1) [1955]1 S.C.R.92.

2-807 Sup CI/71

242

the general averment in particular cases but

it is by no means necessary because of the

presumption which section 5(3) requires the

Court to draw."

This Court accordingly held in that case that there was no

illegality in the charge. We accordingly hold that the

charge in this case was not illegal.

We may now deal with the merits of the case. This is an

appeal by special leave, and as there are concurrent

findings of fact we do not ordinarily go into questions of

fact. But we allowed Mr. Chari to take us through the

relevant evidence, both oral and documentary, in order to

show whether the concurrent findings were vitiated in any

respect. He has not been able to point out any

circumstances which may lead us to differ from the concur-

rent findings. It is true that as far as the case of

Gopaldas is concerned the High Court differed from the

Special Judge and held that the allegations were proved.

The learned counsel has taken us in detail through the

material relevant to this witness and we are inclined to

agree with the conclusion arrived at by the High Court. But

apart from that the concurrent findings regarding P.W. 7,

Motilal, and P.W. 9, Somchand, and the presumption arising

under s. 5(3) are sufficient to sustain the conviction

recorded against the appellant.

The learned counsel urged before us that if the prosecution

fails to establish any of the offences mentioned in S. 5 (1)

(a) to 5 (1) (d), the question of assets being found

disproportionate to the known sources of the accused becomes

irrelevant. A number of cases were referred to us but we

are unable to agree with this proposition because we are

bound by the ruling to the ,contrary given by this Court.

In Biswabhusan Naik v. State of Orissa(1), after referring

to S. 5(1)(a) and S. 5(3), Bose, J., speaking for the Court,

observed :

"Therefore, all that the prosecution has to do

is to show that the accused, or some person on

his behalf, is in possession of pecuniary

resources or property disproportionate to his

known sources of income and for which the

accused cannot satisfactorily account. Once

that is established then the Court has to

presume, unless the contrary is proved, that

the accused is guilty of the new offence

created by section 5, namely criminal

misconduct in the discharge of his official

duty."

(1) [19551] 1 S.C.R. 92.

243

Then the Court proceeded to deal with the facts thus

"Now the accused was found in possession of

Rs. 3,148/-. He accounted for Rs. 430/- of

that sum by showing that it was paid to him

at the, time as a trap. He has been acquitted

of that offence, so all he had to account for

was the balance Rs. 2,698/-. This is a large

sum for a touring officer to carry with him in

cash while on tour. His explanation was not

considered satisfactory and that is a question

of fact with which we are not concerned in

this Court. Therefore, all that remains to be

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seen is whether this was disproportionate to

his known sources of income."

Then the Court referred to the findings regarding his total

emoluments drawn and the small piece of land owned by him,

and observed

"Once the facts set out above were found to

exist and the explanation of the accused

rejected as unsatisfactory, section 5(3) was

at once attracted and the Court was bound to

presume (the word-used in the section is

'shall' and not 'may') that the accused was

guilty under section 5(2), especially as this

part of the section goes on to say 'and his

conviction 'therefor shall not be invalid by

reason only that it is based solely on such

presumption."

These facts alone are enough to sustain the

conviction and we need not consider the other

matters."

The conviction, therefore, of Biswabhushan Naik, in that

case, solely proceeded on the presumption as in the earlier

part of the judgment it was observed that he was separately

charged and separately prosecuted under s. 161 of the Indian

Penal Code for three specific offences of bribe taking but

was acquitted on all the counts and his conviction was only

under s. 5 (2) alone.

Similarly in C.S.D. Swamy v. The State, Swamy's conviction

was sustained only on the presumption. The appellant,

Swamy, in that case was put up on trial on charges under ss.

5(1) (a) and 5 (1) (d) of the Act. Payments of particular

sums by way of bribe were not proved against him. But the

High Court, holding that the appellant's bare statements

from the dock un supported by any other acceptable evidence

could not satisfactorily account for the large deposits

standing to his credit in

(1) [1960] 1 S.C.R. 461.

244

his bank accounts raised the presumption under S. 5 (3) of

the ,Act and held him guilty of criminal misconduct in the

discharge of his official duty under S. 5 (1) (d) of the

Act. It was contended before this Court that the charge

relating to specific instances of bribery having failed the

contrary presumption under s. 5(3) of the Act should have

been established. This Court repelled the argument in the

following words :

"The finding of the High Court and the court

below is that the prosecution had failed to

adduce sufficient evidence to prove those

particular facts and circumstances of criminal

misconduct within the meaning of s. 5 (1 ) (a)

of the Act, but the failure to bring the

charge home to the accused under s. 5 (1 ) (a)

does not necessarily lead to the legal effect

contended for. As soon as the requirements of

sub-section (3) of s. 5 have been fulfilled,

the Court will not only be justified in

making, but is called upon to make the

presumption that the accused person is guilty

of criminal misconduct within the meaning of

s. 5 (1) (d). .......... If there is evidence

forthcoming to satisfy the requirements of the

earlier part of sub-s. (3) of s. 5, conviction

for criminal misconduct can be had on the

basis of the presumption which is a legal pre-

sumption to be drawn from the proof of' facts

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in the earlier part of the sub-s. (3)

aforesaid. That is what has been found by the

courts below against the accused person.

Hence, the failure of the charge under cl. (a)

of sub-s. (1) of s. 5 does not necesarily mean

the failure of the charge tinder S. 5(1)(d)."

It will be noticed that while Bose, J., in Biswabhushan Naik

v. State of Orissa(1), held that once the presumption

applies the accused was guilty of the new offence created by

S. 5, namely. criminal misconduct in the discharge of his

official duties, without specifying any of the sub-

clauses,Sinha, J,, as he then was. held that the offence

under' S. 5 (1) (d) 'was made out. It is not necessary to

decide in-this case which is the correct way of putting the

matter because, whichever reasoning is adopted the case of

the appellant fails.

The case of Surajpal Singh v. State of Uttar Pradesh(2) does

not assist the appellant. It is true that, as laid down by

this Court, s. 5(3) does not create a new offence. But this

does not mean that if the prosecution fails to prove the

specific

(1) [1955] 1 S.C.R. 92.

(2) [1961] 2 S.C.R.971.

245

charges the presumption under s. 5(3) cannot be applied. in

Surajpal's case what, happened was that the only charge

against Surajpal was of 'criminal misconduct under s.

5(1)(c) of the Act. But since he was acquitted of the

charge it was held that he could not be convicted. of

criminal misconduct referred to in cls. (a), (b) or (d) of

s. 5(1) of the Act for which he had not been charged.

R. S. Pandit v. State of Bihar(1) also does not assist

'the appellant. It is true that it was held in that case s.

5(3) does not create a separate offence but lays down only a

rule of evidence and marks a departure from the well-

established principle of criminal jurisprudence that onus is

always on the prosecution to bring home the guilt to the

accused. But it does not follow from this that if the

prosecution has failed to prove specific instances it cannot

rely on the presumption.

The learned counsel contended that if this is the law, the

prosecution need not allege any specific instance at all and

could come to Court only alleging that the accused had

assets disproportionate to his known sources of income.

This point does not arise in this case and is not likely to

arise again because the Act has since been amended and the

act of possessing pecuniary resources or property

disproportionate to known sources of income, for which the

public servant cannot satisfactorily account, has been made

into a separate offence. Therefore we need not consider

this example given by the learned counsel.

Accordingly we hold that the, appellant in this case had

pecuniary resources and property disproportionate to his

known sources of income, and that both the High Court and

the learned Special Judge rightly held that the presumption

arose under s. 5 (3).

We may mention that the learned counsel tried to show that

the assets were not too disproportionate but nothing has

been shown which would entitle us to set 'aside the

concurrent findings on this aspect of the case.

The learned counsel then said that a fine of Rs. 1,25,000/-

has been levied and the appellant has already undergone sen-

tence of about four months. He said that the appellant is

now on bail and it would be hard on him if we send him back

to jail. He further said that the investigation began

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somewhere in 1961, the trial began in 1963, and the expenses

of the,trail and the printing of the records has cost the

appellant a great deal,

(1) [1963] Supp. 2 S.C.R. 652.

246

and further that the State has kept Rs. 1,25,000/- out of

the seized amount for recovery of the fine. The learned

council for the respondent drew our attention to s. 5(2)

which provides that any public, servant who commits criminal

miscounduct in the discharge of his duty shall be punishable

with imprisonment which shall not be less than one year but

which may extend to seven Years and shall also be liable to

fine, provided that the court may, for any special reasons

recorded in writing impose a sentence of imprisonment of

less than one year. It seems to us that in view of the

facts mentioned by the learned counsel for the appellant it

will meet the ends of justice if the sentence is reduced to

one already undergone, maintaining the sentence of fine.

In the result the appeal is allowed to the extent that

sentence of three year's rigorous imprisonment is altered to

imprisonment already undergone. His bail bonds shall stand

cancelled.

V.P.S. Sentence

modified.

247