15 December 1970
Supreme Court


Case number: Appeal (crl.) 83 of 1965






DATE OF JUDGMENT: 15/12/1970


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



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



             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



             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



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



             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



             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



             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



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