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CASE NO.: Appeal (crl.)  208 of 1997

PETITIONER: State of Andhra Pradesh                                          

RESPONDENT: V. Vasudeva Rao                                          

DATE OF JUDGMENT: 13/11/2003

BENCH: DORAISWAMY RAJU & ARIJIT PASAYAT

JUDGMENT: J U D G M E N T

ARIJIT PASAYAT,J

       It is a strange co-incidence that the Prevention of Corruption  Act, 1947 (hereinafter referred to as the ’Act’) was enacted in the year  of our country’s independence.

       Corruption is one of the most talked about subjects today in the  country since it is believed to have penetrated into every sphere of  activity. It is described as wholly widespread and spectacular.

       Corruption as such has reached dangerous heights and dangerous  potentialities.  The word ’corruption’ has wide connotation and embraces  almost all the spheres of our day to day life the world over.  In a  limited sense it connotes allowing decisions and actions of a person to  be influenced not by rights or wrongs of a cause, but by the prospects  of monetary gains or other selfish considerations.  Avarice is a common  frailty of mankind, and while Robert Walpole’s observation that every  man has a price, may be a little generalized, yet it cannot be gainsaid  that it is not far from truth.  Burke cautioned "Among a people  generally corrupt, liberty cannot last long".

        In this appeal, the State of Andhra Pradesh has questioned  legality of judgment rendered by a learned Single Judge of Andhra  Pradesh High Court directing acquittal of the respondent-V. Vasudeva Rao  (hereinafter referred to as the ’accused’) who faced trial for alleged  commission of offences punishable under Section 161 of the Indian Penal  Code, 1860 (for short the ’IPC’) and Section 5(2) read with Section 5  (1)(d) of the Act. He was sentenced to undergo rigorous imprisonment for  two years and to pay a fine of Rs.5,000/- on each count by the trial  Judge i.e. the Principal Special Judge for SPE and ACB Cases, City Civil  Court, Hyderabad.  

       Prosecution version which led to the trial of the case is  essentially as follows:

       The accused\026respondent was substantively posted as Assistant  Controller, Weights and Measures in the year 1988-89. He was kept in  charge of superior post of Deputy Controller, Weights and Measures,  Warangal in the year 1988. He was working as such between the period  31.1.1988 to 8.6.1988 and was thus a public servant within the meaning  of Section 21 IPC. Complainant-D. Raghunath was working as Inspector of  Weights and Measures at Warangal between August 1985 to April 1988. On  3.4.1988, the accused  sent for the complainant-Raghunath and hinted  that his transfer from Warangal to Karimnagar was on the cards.  Complainant-Raghunath requested him not to transfer him to Karimnagar as  he had personal difficulties. It is alleged that the accused thereupon

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demanded a bribe of Rs.10,000/- for retaining him at Warangal itself.  Complainant-Raghunath showed his inability to pay such a large amount.  The accused then reacted by saying that in case the said amount was not  paid to him, the complainant-Raghunath would be transferred. He next  asked Raghunath to give choice of posting in case he was to be  transferred from Warangal. Complainant then requested that if at all he  was to be transferred he may be posted to Jangaon. For such desired  posting the accused made a demand of Rs.2,000/- as a bribe from the  complainant. Complainant agreed to pay the said amount. On 13.4.1988  Raghunath received posting orders accordingly. The accused on the very  same night made a demand of Rs.2,000/- from the complainant.  Complainant-Raghunath requested that he may be allowed to make the  payment in instalments and, promised that he would pay Rs.1,000/- in  first instalment and the remaining would be paid during the next visit  of the complainant to Warangal. In reality, complainant was not willing  to make any payment of bribe amount; and  therefore went and lodged a  complaint on 14.5.1988 with DSP of Anti Corruption Bureau in the matter.  The D.S.P. then arranged for a trap for catching the accused and  accordingly the usual procedure was adopted, and complainant was asked  to bring the amount for being paid to the accused, on the next day in  the office of DSP. After the currency notes were produced by the  complainant on the next day in office, they were smeared with  phenolphthalein powder after selector the mediator’s name. Later,  complainant accompanied by policy party inclusive of mediator went  towards the office of accused. Complainant entered in and passed the  amount to  the accused, and thereafter gave a pre-planned signal to the  raiding party. The raiding party then entered and the tainted amount was  found to be possessed by the accused. After usual panchanama etc. the  case was registered against the accused and he was prosecuted before the  learned Special Judge for ACB cases at Hyderabad.  Thirteen witnesses  were examined to substantiate the accusations.                   The accused pleaded innocence. His defence was that he had never  taken or accepted any amount by way of bribe. The amount of Rs.1,000/-  was advanced by way of hand loan to the complainant-Raghunath who died  some times around July, 1990. There was no acceptance of any bribe  money. Four witnesses were examined to further the plea of innocence. As  noted above, the complainant-Raghunath had died and as a result he could  not be examined as a witness at the time of trial before the trial  Court.  

Learned Special Judge on the basis of evidence adduced held that  though the complainant-Raghunath could not be examined there was  sufficient evidence otherwise to prove that the accused had made demand  of the bribe amount as alleged by the prosecution and he in fact  received the tainted amount of Rs.1,000/- on the date of trap from the  complainant-Raghunath.  The plea that he had given a hand loan was held  to have not been established. The conviction and sentence were  challenged in appeal before the High Court.  

       The High Court came to hold that there was no material to show  that any demand was made for the amount as bribe. It was therefore  observed that Section 4 of the Act has no application.  The evidence of  PW-6, the Panch  and that of the concerned D.S.P. (PW-11) was found not  sufficient to further the prosecution version. It was noted that as per  the evidence of Panch (PW-6) and that of the DSP (PW-11) the signal was  given by the deceased-Raghunath at about 9.50 a.m. Both of them had  stated in their evidence that they have left the DSP’s office at about  9.05 a.m. According to the High Court, the complainant-Raghunath must  have been inside the office of the appellant for considerable length of  time and there is absolutely no evidence as to what was going on during  all this period of more than 15 to 20 minutes. Though it was held that  the theory of hand loan as advanced by the accused is not convincing and  may not be accepted, yet the prosecution was required to establish by  cogent and convincing evidence that the accused had demanded the amount

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and that towards such demand the decoy-witness had gone and paid the  amount and it was accepted as such. Further the High Court observed that  though there was no explanation offered for the presence of  phenolphthalein                                                               powder that was not sufficient to hold the accused guilty.  

       Finally, it was observed that the prosecution was not relieved of  its duty to prove acceptance of money by accused merely because the  accused stated in his explanation that the amount seized was towards re- payment of loan. The proof of prosecution case must precede the stage of  examination of accused and that there was no evidence to prove  acceptance of money by the appellant the presumption available under  Section 4 was still born and what was stated in the statement of the  accused under Section 313 of the Code of Criminal Procedure, 1973 (for  short the ’Code’) does not become evidence. With these findings, the  conviction and sentence were set aside.  

       In appeal, learned counsel for the State submitted that the  approach of the High Court is erroneous. The presumption under Section 4  of the Act was clearly available particularly when there was no denial  about recovery of the money. In fact the positive stand of the accused  was that the money had been received by him, but as an act of receiving  back the money advanced.  It was further submitted that even if  presumption is not available the Court can presume that in ordinary  course most probable inference was supportable by the evidence on  record.  

       In response, learned counsel for the accused submitted that the  High Court’s conclusions are on terra firma. When the evidence on record  does not establish any demand mere recovery would not suffice. The High  Court has also analysed the factual position to conclude that presence  of the phenolphthalein powder is not an incriminating circumstance. What  is important for the purpose of the presumption under Section 4 of the  Act is that the amount must have been received as gratification. There  is no evidence in that regard.  

       Reliance was placed on V.K. Sharma v. State (Delhi Admn.) (1975  (1) SCC 784), Sita Ram v. The State of Rajasthan (1975 (2) SCC 227) and  Suraj Mal v. State (Delhi Admn.) (1979(4) SCC 725) to contend that mere  recovery in the absence of any evidence to show payment of money was not  sufficient. Mere recovery without proof of its payment by or on behalf  of the complainant would not bring in application of Section 4 of the  Act.  

       For appreciating rival stands it would be proper to quote Section  4(1) of the Act, which reads as follows:

       "4.(1) Presumption where public servant accepts  gratification other than legal remuneration.-(1)  Where in any trial or an offence punishable under  Section 161 or Section 165 of the IPC or of an  offence referred to in clause (a) or clause (b) of  sub-section (1) of Section 5 of this Act  punishable  under sub-section (2) thereof, it is proved that an  accused person has accepted or obtained, or has  agreed to accept or attempted to obtain, for himself  or for any other person any gratification (other than  legal remuneration) or any valuable thing from any  person, it shall be presumed unless the contrary is  proved that he accepted or obtained, or agreed to  accept or attempted to obtain, that gratification or  that valuable thing, as the case may be, as a motive  or reward such as is mentioned in the said Section  161, or, as the case may be, without consideration or  for a consideration which he knows to be

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inadequate."          Before proceeding further, we may point out that the expressions  "may presume" and "shall presume" are defined in Section 4 of the  Indian Evidence Act, 1872 (in short the ’Evidence Act’). The  presumptions falling under the former category are compendiously known  as "factual presumptions" or "discretionary presumptions" and those  falling under the latter as "legal presumptions" or "compulsory  presumptions". When the expression "shall be presumed" is employed in  Section 4(1) of the  Act, it must have the same import of compulsion.   

When the sub-section deals with legal presumption, it is to be  understood as in terrorem i.e. in tone of a command that it has to be  presumed that the accused accepted the gratification as a motive or  reward for doing or forbearing to do any official act etc., if the  condition envisaged in the former part of the section is satisfied. The  only condition for drawing such a legal presumption under Section 4 is  that during trial it should be proved that the accused has accepted or  agreed to accept any gratification. The Section does not say that the  said condition should be satisfied through direct evidence. Its only  requirement is that it must be proved that the accused has accepted or  agreed to accept gratification. Direct evidence is one of the modes  through which a fact can be proved. But that is not the only mode  envisaged in the Evidence Act. (See M. Narsinga Rao v. State of A.P.  (2001 (1) SCC 691).  

Proof of the fact depends upon the degree of probability of its  having existed. The standard required for reaching the supposition is  that of a prudent man acting in any important matter concerning him.  Fletcher Moulton L.J. in Hawkins v. Powells Tillery Steam Coal Co. Ltd.  (1911 (1) KB 988) observed as follows:

       "Proof does not mean proof to rigid  mathematical demonstration, because that is  impossible; it must mean such evidence as would  induce a reasonable man to come to a particular  conclusion".  

The said observation has stood the test of time and can now be  followed as the standard of proof. In reaching the conclusion the Court  can use the process of inferences to be drawn from facts produced or  proved. Such inferences are akin to presumptions in law. Law gives  absolute discretion to the Court to presume the existence of any fact  which it thinks likely to have happened. In that process the Court may  have regard to common course of natural events, human conduct, public or  private business vis-‘-vis the facts of the particular case. The  discretion is clearly envisaged in Section 114 of the Evidence Act.  

Presumption is an inference of a certain fact drawn from other  proved facts. While inferring the existence of a fact from another, the  Court is only applying a process of intelligent reasoning which the mind  of a prudent man would do under similar circumstances. Presumption is  not the final conclusion to be drawn from other facts. But it could as  well be final if it remains undisturbed later. Presumption in law of  evidence is a rule indicating the stage of shifting the burden of proof.  From a certain fact or facts the Court can draw an inference and that  would remain until such inference is either disproved or dispelled.  

For the purpose of reaching one conclusion the Court can rely on a  factual presumption. Unless the presumption is disproved or dispelled or  rebutted the Court can treat the presumption as tantamounting to proof.  However, as a caution of prudence we have to observe that it may be  unsafe to use that presumption to draw yet another discretionary  presumption unless there is a statutory compulsion. This Court has  indicated so in Suresh Budharmal Kalani v. State of Maharashtra (1998

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(7) SCC 337) "A presumption can be drawn only from facts \026 and not from  other presumptions \026 by a process of probable and logical reasoning".  

Illustration (a) to Section 114 of the Evidence Act says that the  Court may presume that "a man who is in the possession of stolen goods  soon after the theft is either the thief or has received the goods  knowing them to be stolen, unless he can account for his possession".  That illustration can profitably be used in the present context as well  when prosecution brought reliable materials that there was recovery of  money from the accused. In fact the receipt and recovery is accepted.  The other factor is the acceptability of the plea of loan, which the  High Court itself has not held cogent or credible.                   We may note that a three-Judge Bench in Raghubir Singh v. State of  Punjab (1974 (4) SCC 560) held that the very fact that the accused was  in possession of the marked currency notes against an allegation that he  demanded and received the amount is "res ipsa loquitur".  

       In Hazari Lal v. State (Delhi Admn.) (1980 (2) SCC 390) it was  observed that there is no requirement to prove passing of money by  direct evidence. It may also be proved by circumstantial evidence. In  Madhukar Bhaskarrao Joshi v. State of Maharashtra ( 2000 (8) SCC 571) it  was observed thus:         "The premise to be established on the facts for  drawing the presumption is that there was payment or  acceptance of gratification. Once the said premise is  established the inference to be drawn is that the  said gratification was accepted "as motive or  reward" for doing or forbearing to do any official  act. So the word "gratification" need not be  stretched to mean reward because reward is the  outcome of the presumption which the court has to  draw on the factual premise that there was payment of  gratification. This will again be fortified by  looking at the collocation of two expressions  adjacent to each other like "gratification or any  valuable thing". If acceptance of any valuable thing  can help to draw the presumption that it was accepted  as motive or reward for doing or forbearing to do an  official act, the word "gratification" must be  treated in the context to mean any payment for giving  satisfaction to the public servant who received it".    

It is to be noted that decisions relied upon by the learned counsel for  the accused were considered in Narsinga Rao’s case (supra) and it was  held that the principles had no application as the findings recorded  depend upon the veracity of the testimony of the witnesses, so far as  Suraj Mal’s case (supra) is concerned, and the observations in Sita  Ram’s case (supra), were to be confined to the facts of that case and no  legal principle for future application could be discerned therefrom.  

       In Black’s Law Dictionary, "gratification" is defined as "a  recompense or reward for services or benefits, given voluntarily,  without solicitation or promise". But in Oxford Advance Learner’s  Dictionary of Current English the said word is given the meaning "to  give pleasure or satisfaction to". Among the above two descriptions for  the word "gratification" with slightly differing nuances as between  the two, what is more appropriate for the context has to be found out.  The context in which the word is used in Section 4(1) of the Act is,  hence, important.  

       In Mohmoodkhan Mahboobkhan Pathan v. State of Maharashtra (1997  (10) SCC 600) this Court has taken the same meaning for the word  "gratification" appearing in Section 4(1) of the Act. We quote the  following observations:

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       "7. The primary condition for acting on the  legal presumption under Section 4(1) of the Act is  that the prosecution should have proved that what the  accused received was gratification. The word  ’gratification’ is not defined in the Act. Hence, it  must be understood in its literal meaning. In the  Oxford Advanced Learner’s Dictionary of Current  English, the word ’gratification’ is shown to have  the meaning ’to give pleasure or satisfaction to’.  The word ’gratification’ is used in Section 4(1) to  denote acceptance of something to the pleasure or  satisfaction of the recipient."                            What is the concept of gratification has been succinctly  stated by this Court in The State of Assam v. Krishna Rao (1973 (3) SCC  227), in following illuminating words:  "21.-In our opinion, there is merit in the  appellant’s contention that the High Court has taken  an erroneous view of Section 4 of the Prevention of  Corruption Act. That section reads:

"4. Presumption where public servant  accepts gratification other than legal  remuneration.-(1) Where in any trial or an  offence punishable under Section 161 or  Section 165 of the IPC or of an offence  referred to in clause (a) or clause (b) of  sub-section (1) of Section 5 of this Act   punishable under sub-section (2) thereof,  it is proved that an accused person has  accepted or obtained, or has agreed to  accept or attempted to obtain, for himself  or for any other person any gratification  (other than legal remuneration) or any  valuable thing from any person, it shall  be presumed unless the contrary is proved  that he accepted or obtained, or agreed to  accept or attempted to obtain, that  gratification or that valuable thing, as  the case may be, as a motive or reward  such as is mentioned in the said Section  161, or, as the case may be, without  consideration or for a consideration which  he knows to be inadequate.                     (2)    Where in any trial of an offence  punishable under Section 165-A of the  Indian Penal Code or under clause (ii) of  sub-section (3) of Section 5 of this Act,  it is proved that any gratification (other  than legal remuneration) or any valuable  thing has been given or offered to be  given or attempted to be given by an  accused person, it shall be presumed  unless the contrary is proved that he gave  or offered to give or attempted to give  that gratification or that valuable thing,  as the case may be, as a motive or reward  such as is mentioned in Section 161 IPC or  as the case may be without consideration  or for a consideration which he knows to  be inadequate.

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(3)     Notwithstanding anything contained in  sub-sections (1) and (2) the court may  decline to draw the presumption referred  to in either of the said sub-sections, if  the gratification or thing aforesaid is,  in its opinion, so trivial that no  inference of corruption may fairly be  drawn."

22.-In State of Madras v. A. Vaidiaratha Iyer (1958  SCR 580) after reproducing the relevant provisions of  Section 4 of the Act this Court observed that where  it is proved that a gratification has been accepted  the presumption under Section 4 of the Act shall at  once arise. It is a presumption of law and it is  obligatory on the Court to raise it in every case  brought under Section 4. In the reported case this  Court allowed the appeal of the State of Madras and  setting aside the impugned order of acquittal passed  by the High Court restored that of the Special Judge  convicting the respondent there. In C.I. Emden v. The  State of U.P. (AIR 1960 SC 548) the appellant who was  working as a local foreman, was found to have  accepted a sum of Rs.375 from a railway contractor.  The appellant’s explanation was that he had borrowed  the amount as he was in need of money for meeting the  expenses of the clothing of his children who were  studying in school. The Special Judge accepted the  evidence of the contractor and held that the money  had been taken as a bribe, that the defence story was  improbable and untrue, that the presumption under  Section 4 of the Act had to be raised and that the  presumption had not been rebutted by the appellant  and accordingly convicted him under Section 161 IPC  and Section 5 of the Act. On appeal the High Court  held that on the facts of that case the statutory  presumption under Section 4 had to be raised, that  the explanation offered by the appellant was  improbable and palpably unreasonable and that the  presumption had not been rebutted, and upheld the  conviction. The appellant contended, on appeal in  this Court, inter alia: (i) that the presumption  under Section 4 could not be raised merely on proof  of acceptance of money but it had further to be  proved that the money was accepted as a bribe, (ii)  that even if the presumption arose it was rebutted  when the appellant offered a reasonably probable  explanation. This Court, dealing with the presumption  under Section 4, observed that such presumption arose  when it was shown that the accused had received the  stated amount and that the said amount was not legal  remuneration. The word ’gratification in Section 4(1)  was to be given its literal dictionary meaning of  satisfaction or appetite or desire; it could not be  construed to mean money paid by way of a bribe. The  High Court was justified in raising the presumption  against the appellant as it was admitted that he had  received the money from the contractor and the amount  received was other than legal remuneration. On the  facts the explanation given by the accused, in  agreement with the opinion of the High Court was held  to be wholly unsatisfactory and unreasonable. In  Dhanvantrai v. State of Maharashtra (AIR 1964 SC 575)  it was observed that in order to raise the  presumption under Section 4(1) of the Act what the

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prosecution has to prove is that the accused person  has received ’gratification other than legal  remuneration’ and when it is shown that he has  received a certain sum of money which was not a legal  remuneration, then, the condition prescribed by this  section is satisfied and the presumption thereunder  must be raised. In Jhangan v. State of U.P. (1968 (3)  SCR 766) the above decisions were approved and it is  observed that mere receipt of money is sufficient to  raise the presumption under Section 4(1) of the  Act."   

       In C.I. Emden v. State of Uttar Pradesh (AIR 1960 SC 548) and V.D.  Jhangan v. State of Uttar Pradesh (1966 (3) SCR 736) it was observed  that if any money is received and no convincing, credible and acceptable  explanation is offered by the accused as to how it came to be received  by him, the presumption under Section 4 of the Act is available. When  the receipt is admitted it is for the accused to prove as to how the  presumption is not available as perforce the presumption arises and  becomes operative.  

When the factual position is examined in the background of legal  principles culled out from various decisions of this Court, the  inevitable conclusion is that the High Court’s judgment is indefensible.  We set aside the judgment and hold that the accused was rightly  convicted under Section 161 IPC and Section 5 (2) read with Section 5  (1)(d) of the Act by the trial Court.   

       Coming to the question of sentence, learned counsel for the  accused submitted that the accused is presently aged 75 years.  At the  relevant point of time, the minimum sentence was one year and for  special reasons this sentence could be reduced. In a case involving  acceptance of illegal gratification there is no scope for any leniency.  The tentacles of corruption are spreading fast in the society corroding  the moral fibre and consequentially in most cases the economic structure  of the country. It has assumed alarming proportions in recent times.  Though the occurrence at hand took place nearly 14 years back, yet as  noted at the threshold, the Act was brought into anvil in the year of  country’s independence. The object appeared to be to nip the propensity  for being corrupt in the bud. The growth of corruption has to a great  extent frustrated the purpose for which the Act was enacted, and both  the Act and its successor Act in 1988 do not appear to have curbed the  growth of corruption, and to have achieved the intended results.  

       As observed in Madhukar’s case (supra), there is no such proviso  as in Section 5(2) of the earlier Act and no power whatsoever is given  to the Court to impose a sentence less than the minimum, even if there  are special reasons for doing so. Parliament fixed the minimum sentence  of imprisonment of one year even under the Act of 1947 by making an  amendment to it in 1958 for which the legislative language is apparently  peremptory i.e. "shall not be less than one year". The proviso is in  the form of a rare exception by giving power to the Court for reducing  the imprisonment period below one year only when there are "special  reasons" and the law required that those special reasons must be  recorded in writing by the Court.

       When corruption was sought to be eliminated from the polity all  possible stringent measures are to be adopted within the bounds of law.  One such measure is to provide condign punishment. Parliament measured  the parameters for such condign punishment and in that process wanted to  fix a minimum sentence of imprisonment for giving deterrent impact on  other public servants who are prone to corrupt deals. That was precisely  the reason why the sentence was fixed as 7 years and directed that even  if the said period of imprisonment need not be given the sentence shall

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not be less than the imprisonment for one year. Such a legislative  insistence is reflection of Parliament’s resolve to meet corruption  cases with a very strong hand and to give signals of deterrence as the  most pivotal feature of sentencing of corrupt public servants. All  public servants were warned through such a legislative measure that  corrupt public servants have to face very serious consequences. If on  the other hand any public servant is given the impression that if he  succeeds in protracting the proceedings that would help him to have the  advantage of getting a very light sentence even if the case ends in  conviction, we are afraid its fallout would afford incentive to public  servants  who are susceptible to corruption to indulge in such nefarious  practices with immunity. Increasing the fine after reducing the  imprisonment to a nominal period can also defeat the purpose as the  corrupt public servant could easily raise the fine amount through the  same means.  

       In the present case, how could the mere fact that this was pending  for such a long time be considered as a "special reason"? That is a  general feature in almost all convictions under the Act and it is not a  speciality of this particular case. It is the defect inherent in  implementation of the system that longevity of the cases tried under the  Act is too lengthy. If that is to be regarded as sufficient for reducing  the minimum sentence mandated by Parliament the legislative exercise  would stand defeated.  

Considering the age of the accused, we reduce only the sentence to  the minimum of one year without touching the fine imposed, but do not  find any justifiable reason to reduce it below the minimum. The appeal  is allowed to the extent indicated above.