REPORTABLE

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO. 906 OF 1998

S.Mohan …..Appellant

Versus

Central Bureau of Investigation ….Respondent

WITH

CRIMINAL APPEAL NO. 910 OF 1998

J U D G M E N T

K.G. Balakrishnan, CJI

These two statutory appeals under Section 10 of the

Special Court (Trial of Offences relating to Transactions in

Securities)  Act, 1992 (for short ‘the said Act’)  are filed by

Accused  No.  3 and 4  in Special  Case  No.  7/1994,  being

aggrieved  by  the  Judgment  and  Order  dated

6th/7th/13th/14th August,  1998  convicting  and  sentencing

them.

2. These  two appellants were tried alongwith two other

accused  persons  by  the  Special  Court  (Trial  of  Offences

Relating to Transactions in Securities)  at Bombay and by

Judgment dated 14th August, 1998, these appellants were

found guilty of various offences.  The appellant in Criminal

Appeal  No.  906  of  1998 (third accused  –  S.  Mohan)  was

found guilty of offence punishable under Section 409 IPC

and was sentenced to undergo rigorous imprisonment for

seven  years  and  a  fine  of  Rs.  1  lakh,  and  with  default,

sentence for a period of one and a half year.   He was also

found guilty of the offences punishable under Sections 13(1)

(c ) and 13(1) (d) read with Section 13(2) of the Prevention of

Corruption  Act  and for  this  offence  he  was  sentenced  to

undergo  rigorous  imprisonment  for  a  period  of  five  years

and  a  fine  of  Rs.  50,000,  in  default  of  payment  of  fine,

sentence for a period of one year.  He was also found guilty

of  the  offence  punishable  under  Section  411  read  with

Section 120B IPC and sentenced to undergo two years RI

and a fine of Rs. 50,000/- and in default sentence for six

months.  The appellant in Criminal Appeal No. 910 of 1998

(fourth accused- Hiten P. Dalal) was found guilty of offences

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punishable under Section 409 read with Section 120B IPC

and  sentenced  to  undergo  seven  years  rigorous

imprisonment and a fine of Rupees 1 lakh and with default,

sentence for a period of one and half years.  He was also

found guilty  of  an offence  punishable  under  Section  411

IPC  and  was  sentenced  to  undergo  imprisonment  for  a

period  of  two years  and a  fine  of  Rs,  50,000/-,  and   in

default, sentence for a period of six months.  The sentences

were  to  run  concurrently.   The  special  court  acquitted

accused 1 and 2.

3. In the year 1992, certain irregularities were detected

in  various  security  transactions  that  had  taken  place

between certain financial institutions.  The Reserve Bank of

India  constituted  a  Committee  known  as  “Janakiraman

Committee”  to  look  into  the  real  nature  of  these

transactions  and  to  find  out  if  any  fraud  or  financial

irregularities  had  taken  place  in  these  transactions.    It

appears  that  in  the  course  of  the  enquiry  by  the

“Janakiraman  Committee”,  it  was  found  that  large  scale

irregularities and malpractices were noticed in transactions

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both in the Government and other securities, indulged in by

some  brokers  in  collusion  with  the  employees  of  various

banks and financial institutions.  It was noticed that these

irregularities and malpractices had led to the diversion of

funds  from  banks  and  financial  institutions  to  the

individual accounts of certain brokers.  The Central Bureau

of Investigation(CBI) made enquiries generally regarding all

security  transactions  and  it  seems  that  the  CBI  after

investigation of the case filed a report against four accused

before the Special  Court alleging that these accused were

responsible  for  causing  loss  of  Rs.  33  crores  to  Canara

Bank and various other allegations were also made against

these  accused.   Accused  No.  1  was  the  Executive  Vice

President  and Chief  Dealer,  Accused No. 2 was the Asst.

Vice  President  and  Accused  No.  3  was  the  Asstt.  Vice

President and Dealer, of Canbank Financial Services Ltd. at

the relevant point of time.  Accused No. 4 was a Share and

Securities Broker.  

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4. Andhra Bank is a nationalized Bank and Andhra Bank

Financial Services Limited is a company wholly owned by

the Andhra Bank.  Canara Bank is also a nationalized bank

and Canara Bank Mutual Fund (CBMF) is a Trust created

by  the  Canara  Bank.   The  Canara  Bank  was  the  chief

trustee  of  the  trust-CBMF.   Canbank  Financial  Services

Limited(‘CANFINA’  for  short)  is  a  subsidiary  company  of

Canara Bank.  The Chairman and the Managing Director of

Canara Bank was also the Chairman of Canbank Financial

Services Limited.  The Managing Director of CANFINA was a

person deputed by Canara Bank and the Executive Director

also was appointed by Canara Bank.  The trust,  namely,

Canbank  Mutual  Fund  under  a  scheme  prepared  by  it

issued units known by the name “CANCIGO” in the shape

of credit sheets which provided a fixed rate of interest with a

stipulation that these credit sheets may not be transferred

for  a  period  of  one  year.   The  CANCIGO  Units  could  be

encashed only after the completion of this lock-in period of

one year from the date of issue.  The scheme was operated

under the Rules framed by Canbank Mutual Fund.  One of

the rules so framed imposed a restriction on the transfer of

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these units but it permitted transfer of units to the heirs in

case  of  death  of  the  holder  and  also  in  special

circumstances.

5. On August  28, 1991, Accused No. 4 wrote to Andhra

Bank  enclosing  an  application  form  for  CANCIGO  Units

worth  Rs.  11  crores  requesting  the  Bank  to  sign  the

application  on  his  behalf.   On August  29,  1991,  Andhra

Bank  Ltd.  applied  to  the  Canbank  Mutual  Fund,  at  the

request of the appellant Hiten P. Dalal, for the purchase of

CANCIGO Units of the face value of Rs. 11 crores.  A cheque

drawn by the appellant Hiten P. Dalal for the sum of Rs. 11

crores was sent alongwith the application.  The application

was signed by one Dhankumar on behalf of Andhra Bank

Ltd.  Similarly, on Sepetember 14, 1991, the same appellant

Hiten  P.  Dalal  through  Andhra  Bank  Financial  Services

Limited requested for  purchase  of  CANCIGO Units  of  the

face value of Rs. 22 crores alongwith the application and a

cheque drawn by appellant Hiten P. Dalal for Rs. 22 crores

on his account with  Andhra Bank.  On the basis of these

two applications, Canbank Mutual Fund issued two credit

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sheets of the units of CANCIGO one in the name of Andhra

Bank for Rs. 11 crores and the other in the name of Andhra

Bank Financial Services Limited for Rs. 22 crores.  Though

these  two  credit  sheets  were  issued  on  the  basis  of  the

cheques drawn by the appellant Hiten P. Dalal, the credit

sheets  were  issued  in  the  name  of  Andhra  Bank  and

Andhra  Bank  Financial  Services  Limited,  respectively  as

they had signed the application forms.

6. According to the prosecution,  the appellant Hiten P.

Dalal who was a stocks and securities broker was indebted

to CANFINA in a sum of  Rs.  25,01,67,129/-.   It  appears

that  the  appellant  Hiten  P.  Dalal  offered  to  sell  the

CANCIGO  Units  of  the  face  value  of  Rs.  33  crores  to

CANFINA  to  square  up  his  dues  in  the  sum  of  Rs.

25,01,67,129/-.  According to the presecution, accused 1 to

3  entered  into  a  transaction  with  the  appellant  Hiten  P.

Dalal  who  was  the  fourth  accused,  to  purchase  the

CANCIGO Units of the face value of Rs. 33 crores standing

in the name of Andhra Bank and Andhra Bank Financial

Services Limited though there was no letter of authority or

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consent for such sale from either Andhra Bank or Andhra

Bank Financial Services Limited.  The prosecution alleged

that these transactions were entered into by accused 1 to 3

on  behalf  of  CANFINA  knowing  fully  well  that  these

CANCIGO  Units  were  not  transferable  and  the  appellant

Hiten P. Dalal was not competent to deal with them.  The

prosecution  alleged  that  after  adjusting  the  amount  due

from the appellant Hiten P. Dalal, a cheque was issued for

the balance amount of       Rs. 7,98,32,871/- drawn in the

name of Andhra Bank with a letter to the Andhra Bank to

credit the proceeds of the cheque to the account of Hiten P.

Dalal.   The  prosecution  alleged  that  by  this  method  the

appellant Hiten P. Dalal thus got his debt to the tune of Rs,

25,01,67,129/- due to CANFINA wiped out and got a sum of

Rs.  7,98,32,871/-  from CANFINA,  even though CANCIGO

Units were not transferable and could not be transferred to

the name of CANFINA.

7. It  is  in  this  background  all  the  four  accused  were

charged with having entered into a criminal conspiracy for

committing the offence of cheating and criminal breach of

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trust and falsification of accounts and the offences under

Section  13(1)(c)  and  13(1)(d)  read  with  13(2)  of  the

Prevention of the Corruption Act.

8. Under the Special Courts (Trial of Offences Relating to

Transactions  in  Securities)  Act,  1992,  Special  Court  was

established  for  the  speedy  trial  of  cases  relating  to

transactions  in  securities  and  disposal  of  properties

attached.   The  Special  Court  declared  accused  Hiten  P.

Dalal  as  a  “notified  person”  under  this  Act.   Before  the

Special  Court,  the  Custodian  made  an  application  that

CANFINA  be  ordered  to  handover  to  him,  the  CANCIGO

Units  worth Rs.  33 crores  with accrued  interest  thereon.

The  Custodian  contended  that  Accused  No.  4  could  not

have  transferred  the  CANCIGO  Units  which  were  not

standing in his name and the entire transaction was tainted

with illegality.   He  contended  that  therefore,  no title  was

transferred  to  CANFINA;  and  that  as  title  remained  with

Accused No. 4, he was entitled to the said CANCIGO Units.

Before the Special Court, the appellant Hiten P. Dalal and

the Andhra Bank and the Andhra Bank Financial Services

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Limited did not make any claim in regard to the CANCIGO

Units.   The  Canbank  Financial  Services  Limited  claimed

before the Special Court that the CANCIGO Units covered

under the two certificates issued by CBMF were properties

belonging  to  them.   The  Special  Court  by  order  dated

22.9.1993,  allowed  an  application  filed  by  the  custodian

and that Order was challenged before this Court.   By the

judgment  of  this  Court  reported  as  Canbank  Financial

Services  Ltd. Vs.  Custodian (2004)  8  SCC  355,  it  was

finally held that the CANFINA was entitled to succeed on

the transfer of CANCIGO Units of the value of Rs. 33 crores

in favour of CANFINA was legal and valid.  It was also held

that CBMF must be presumed to have issued the CANCIGO

Units  in  the  names  of  Andhra  Bank  and  Andhra  Bank

Financial  Services  with  full  knowledge  that  they  would

enure  to the benefit  of  Hiten P.  Dalal;  and therefore,  the

transfer of CANCIGO Units in favour of CANFINA was valid

and  legal  as  by  reason  of  the  transfer  of  possession  of

CANCIGO  Units  in  favour  of  CANFINA,  a  valid  right  has

been created therein and the same could not be attached in

terms of Section 3(3) of the said Act. The entire finding of

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the Special  Court in this case is to be appreciated in the

light  of  the  decision  rendered  by  this  Court  in  Canbank

Financial Services Ltd. case(supra).

9. These two appellants were found guilty by the Special

Court mainly on the ground that the CANCIGO Units issued

by CBMF of  the face value  of  Rs.  33 crores stood in the

name  of  the  Andhra  Bank  and  Andhra  Bank  Financial

Services Limited and the appellant Hiten P. Dalal was not

entitled to get transfer of these CANCIGO Units and that the

appellant S. Mohan (in Criminal Appeal  No. 906 of 1998)

was instrumental in such transaction and thus entered into

a conspiracy with the accused no. 4.  Both the appellants

have  been  found  guilty  of  offences  punishable  under

Section  406  namely,  Criminal  Breach  of  Trust.   It  is

important to note that,  in the instant case, there was no

complaint either by the Andhra Bank or the Andhra Bank

Financial Services Limited that these appellants committed

any criminal  breach of  trust.   “Criminal  Breach of Trust”

has been defined under Section 405 Indian Penal Code as

under:

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“Whoever, being in any manner entrusted with  property,  or  with  any  dominion  over property,  dishonestly  misappropriates  or converts  to  his  own  use  that  property,  or dishonestly uses or disposes of that property in violation of any direction of law prescribing the  mode  in  which  such  trust  is  to  be discharged, or of any legal contract, express or implied,  which  he  has  made  touching  the discharge of such trust, or willfully suffers any other  person  so  to  do,  commits  “criminal breach of trust.

XXXX

Section 409 IPC deals with criminal breach of trust by

public servant, or by banker, merchant or agent.

10. Here,  the  CANCIGO Units  stood  in the  name of  the

Andhra Bank and Andhra Bank Financial Services Limited.

They apparently entrusted this property to accused no. 4

and allowed him to encash the same.  In fact, Accused No. 4

had  paid  the  consideration  for  purchasing  the  CANCIGO

Units  in  the  names  of  Andhra  Bank  and  Andhra  Bank

Financial Services Ltd. It is true that if a person  entrusted

with  property  dishonestly  misappropriates  that  property,

such misappropriation in violation of any direction of law

prescribing  the  mode  in  which  such  trust  is  to  be

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discharged, or of any legal contract which the person has

made in regard to discharge of such trust, will be guilty of

criminal breach of trust.  According to the prosecution, both

these  appellants  acted  contrary  to  the  express  condition

that these CANCIGO Units were not liable to be transferred

within a period of one year and in spite of this, the Andhra

Bank as well  as  Andhra Bank Financial  Services  Limited

transferred  the  units  in  favour  of  the  appellant  Hiten  P.

Dalal and enabled him to encash the CANCIGO Units with

the connivance of appellant S. Mohan and that constituted

the offence of Criminal Breach of Trust.  It was alleged that

Accused  No.  3 while  employed by CANFINA,  obtained  for

Accused No. 4, a pecuniary advantage of Rs. 33 crores by

illegally  purchasing  CANCIGO  Units  and  committed

criminal breach of trust in regard to the employer’s funds of

Rs. 33 crores.  It is important to note that these Units were

issued by CBMF.  They had imposed restrictions regarding

transfer  of  CANCIGO  Units.   They  have  not  filed  any

complaint alleging that transfer of these Units by appellant

Hiten P. Dalal was contrary to rules.  There is no express

law or statutory rules prohibiting the transfer of CANCIGO

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Units  except  the  terms  of  the  scheme  framed  by  CBMF.

They are not statutory rules and purely contractual.  It is

also pertinent to note that neither the Andhra Bank nor the

Andhra Bank Financial Services Limited filed any complaint

alleging that the appellant Hiten P. Dalal acted contrary to

their directions.  Nor did CANFINA complain that appellant

S. Mohan had committed criminal breach of trust in regard

to  these  transactions  of  CANCIGO  Units.   This  Court  in

Canbank Financial Services Ltd. case(supra) held (at para

38, 39, 40 and 41) as follows:

The  Rules  and  Regulations  framed  by  Canbank Mutual Fund in relation to the issuance of CANCIGO certificates  do  not have  any statutory backing.   The CANCIGOs  had  a  lock-in  period  of  one  year  which means that  the  holder  thereof  must  not  encash the securities  within  the  aforementioned  period.   The question as regards the non-transferability of the units will have to be construed upon reading the Scheme in its entirety and in particular Condition 22 thereof, inn terms  whereof  the  trustees  were  not  required  to maintain any register of CANCIGO-holders.  In terms of Condition 24, the person whose name is shown in a CANCIGO certificate would be the only person to be recognized  by  the  trustees  as  the  holder  of  such CANCIGO and as having any right, title or interest in or to such securities.  No trust created was also to be recognized.

Condition  19  creating  a  bar  on  transfer  has  to  be construed in the aforementioned context.  The bar on

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transfer created was to have the effect that the same would not be binding on Canbank Mutual Fund as it was not bound to take any notice thereof and only the holder shall be recognized as having the right, title or interest  on  the  CANCIGO…………  CANCIGOs indisputably  are  valuable   securities.   They  are otherwise capable of being transferred in terms of the established business practice, the Sale of Goods Act or the Transfer of Property Act.  No legal bar has been created in transfer of the said securities.  The scheme, thus, does not and could not have created an absolute legal  bar  on  transfer  of  the  CANCIGOs  so  as  to invalidate the same.

 The  rules  and  regulations  framed  by  Canbank Mutual Fund and the notes appended to the CANCIGO credit  sheet  differ  in material  particulars.  Rules  and regulations explain as to why an embargo on transfer has been placed i.e. not to recognize Respondent 2 for the  dividends  or  for  other  liabilities  arising  out  of transfer.  A transfer violating the rules and regulations would  only  have  the  effect  of  the  same  being  not binding  on  Canbank  Mutual  Fund.   No  other  legal consequence  flows therefrom.  We have  also  noticed that the brochure merely states that the transfer is not permitted  but  provisions  exist  for  grant  of  such permission.  The appellant Bank as well as Canbank Mutual  Fund  are  the  subsidiaries  of  Canara  Bank. The appellant cannot be estopped from raising either a limited or absolute title  in them keeping in view the fact that they had paid a sum of 33 crores of rupees by way  of  consideration  for  transfer  of  interest  of Respondent  2  herein  in  the  said  CANCIGOs.”   (The respondent 2 referred to as the present appellant Hiten P. Dalal)

11. It  is not disputed that CANCIGO Units worth Rs. 33

crores  were  purchased  by Andhra Bank or  Andhra Bank

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Financial  Services  Limited  by  making  use  of  the  money

owned by the appellant Hiten P. Dalal.  These two financial

institutions impliedly agreed to lend their name and allowed

the appellant Hiten P. Dalal to purchase CANCIGO Units in

their name.  It is also important to note that interest due on

the  CANCIGO  Units  worth  Rs.  33  crores  received  from

CBMF  by  Andhra  Bank  and  Andhra  Bank  Financial

Services  Ltd. were credited to the account of the appellant

Hiten  P.  Dalal.   Therefore,  it  is  clear  for  all  practical

purposes that the CANCIGO Units worth Rs. 33 crores were

purchased  by  the  appellant  Hiten  P.  Dalal  and  he

transferred these units to CANFINA and CBMF did not raise

any objection in respect of transfer of the CANCIGO Units

by the appellant Hiten P. Dalal.    If  at all,  it  was for the

CBMF to  raise  any  objection  but  they  did  not  raise  any

objection  for  the  transfer  of  the  CANCIGO Units.   It  has

been held by this Court in Canbank Financial Services Ltd.

(supra) that the custodian was not entitled to get the value

of the CANCIGO Units and that the CANFINA had a just

right to possess  the CANCIGO Units to the exclusion  of

Hiten P. Dalal.  It is also not in dispute that CANFINA had

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succeeded in getting the proceeds of these CANCIGO Units.

Therefore,  no  offence  of  Criminal  Breach  of  Trust  is

committed  by  the  appellant  Hiten  P.  Dalal.   He  has  not

acted  contrary  to  the  direction  of  any  person  who  has

entrusted these units to him and it is proved that it was the

appellant  Hiten  P.  Dalal  himself  who  was  the  apparent

owner of these units.   

12. As regards  appellant  S.  Mohan who was one  of  the

Asst. Vice- Presidents of CANFINA, the prosecution case is

that he had telephonically informed PW 6 Mr. Vernekar to

accept the CANCIGO Units.  PW 6 Vernekar is an Officer of

the Canara Bank who had been authorized by the Board

Resolution  to  deal  in  Securities/Bonds  and  execute

securities transactions on behalf of CANFINA.  He deposed

that  he  used  to  receive  telephonic  instructions  from

Bangalore  and  recorded  these  instructions  in  rough

transaction sheets.   He has proved the rough transaction

sheets including the rough transaction sheet on which Ex-

51A  has  been  noted.   PW-6  deposed  that  the  Entry

pertaining to purchase of CANCIGO Units of the face value

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of Rs. 33 crores from accused No. 4 was made on the basis

of  the  instructions  received  from accused  no.  3,  namely,

appellant S. Mohan.  He also deposed that the appellant S.

Mohan sent an Inter Branch Advice No. 32894 by which the

funds were transferred from Bangalore to Bombay in order

to  facilitate  the  payment.   He  deposed  that  the  date  6th

February  1992  was  written  because  CANFINA  Bangalore

had  purchased  CANCIGO  Units  of  face  value  of  Rs.  33

crores  on  6th February  1992.    He  also  deposed  that

appellant  S.  Mohan  had  told  him  that  a  sum  of  Rs.

25,01,67,129/- was recoverable from accused no. 4 against

some transactions and that this amount was to be adjusted

against the transaction of purchase of CANCIGO Units of

face value of Rs. 33 crores.  All these evidence would only

show  that  the  appellant  S.  Mohan  was  involved  in  the

transaction.   The  prosecution  could  not  prove  that  there

was any illegality in these transactions.  The only illegality

pointed out by the learned Counsel for the CBI is that these

CANCIGO Units were not liable to be transferred and the

Andhra Bank and Andhra Bank Financial Services Limited

could not have transferred it to the appellant Hiten P. Dalal.

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So  long  as  the  CANFINA  has  no  grievance  or  complaint

against the appellant S. Mohan that he acted contrary to

their directions and accepted the CANCIGO Units and paid

the money to the appellant Hiten P. Dalal,   no offence is

made out against the appellant S. Mohan either of Criminal

Breach  of  Trust  or  conspiracy.  In  fact,  PW  1  (Mr.  Kini,

Executive Vice President) has admitted that CANFINA used

to regularly deal in CANCIGO Units, that neither the Audit

nor RBI made any remarks regarding transactions relating

to  CANCIGO  Units  and  all  the  transactions  relating  to

CANCIGO Units were in the ordinary course  of  business.

Neither  Canara  Bank  nor  CANFINA  had  initiated  any

disciplinary proceedings against him.  They have also not

disputed  the  genuineness  of  the  CANCIGO  Units  which

were got encashed by the appellant Hiten P. Dalal.

13. The Managing Director of CANFINA (K.N. Kamath) was

examined as PW 16.  He admitted that CANFINA did not file

any  complaint  with CBI  regarding  purchase  of  CANCIGO

Units  of  Rs.  33  crores;  that   according  to  CANFINA,  the

CANCIGO Units were purchased for valuable consideration

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in the normal course of business; that CANFINA stood by

the transactions of purchase of CANCIGO Units of Rs. 33

crores;  that  CANFINA  was  not  induced  to  purchase  the

CANCIGO  Units  of  Rs.  33  crores  by  any  false

representation.

14. In the circumstances, no ingredient of criminal breach

of trust is made out against either of the appellants.

15. The prosecution also could not prove any conspiracy

by these accused persons to commit any criminal acts.  So

long  as  there  was  no  such  evidence,  the  offence  of

conspiracy is not proved against these appellants.

16. The appellant Hiten P. Dalal has been found guilty for

the offence punishable under Section 411 alleging that he

dishonestly  received  the  stolen  property  or  retained  the

same.   No  ingredients  of  this  offence  have  been  proved

against him.  So long as the prosecution admits that the

CANCIGO  Units  worth  Rs.  33  crores  were  purchased  by

making  use  of  the  money  owned  by  him,  they  were  not

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stolen property in the hands of the appellant Hiten P. Dalal.

Neither, the Andhra Bank nor the Andhra Bank Financial

Services Limited has any case that these CANCIGO Units

were stolen by the appellant Hiten P. Dalal.  As the offence

of Criminal Breach of Trust is also not made, the conviction

of the appellant under Section 411 is not sustainable and is

liable to be quashed.  So also, the appellant S. Mohan is not

liable  for the conspiracy to commit offence  under  Section

411 IPC.  

17. The  appellant  S.  Mohan  has  been  found  guilty  of

offence punishable under Section 13(1) ( c) and 13 (1) (d)

read with Section 13(2)  of the Prevention of Corruption Act.

This appellant was one of the Asstt. Vice-Presidents of the

CANFINA  dealing  with  CANCIGO  Units.   There  is  no

allegation that he committed any illegality.  The allegation

against him is to the extent that he accepted the CANCIGO

Units though they stood in the name of the Andhra Bank

and  Andhra  Bank  Financial  Services  Limited.   These

CANCIGO Units  were  worth Rs.  33 crores and they were

accepted  with  the  proper  authorization  by  the  higher

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authorities  in  the  CANFINA.    It  is  highly  improbable  to

believe  that  appellant  S.  Mohan  on  his  own  decided  to

accept  CANCIGO  Units  worth  Rs.  33  crores  without  any

instructions.  CANFINA did not file any complaint alleging

any unauthorized transaction carried out by him.  Now it

has been held by this Court that the entire transaction was

legal and the CANFINA was entitled to the proceeds of these

CANCIGO  Units  and  not  the  “Custodian”  under  the  Act.

Therefore,  the  appellant  S.  Mohan  is  not  guilty  of  the

offence  punishable  under  Section 13(1)  (c  )  and 13(1)  (d)

read with Section 13(2) of the Prevention of Corruption Act.

18.  The appeals filed by both the appellants are allowed.

The accused are not liable for any other offences and they

are  acquitted  of  all  the  offences  charged  against  them.

Their bail bonds stand cancelled.

………………………CJI (K.G. BALAKRISHNAN)

………………………….J. (R.V. RAVEENDRAN)

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………………………….J. (J.M. PANCHAL)

New Delhi May 16, 2008.

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