Prevention of Corruption; K.V. Mathai Vs. State [Kerala High Court, 17-11-2016]

Prevention of Corruption Act, 1947 – Ss. 5 (2) r/w. 5(1)(e) – Something in excess here and there cannot be said to be excess amassment of wealth, or illegal amassment of wealth in the case of a person having other source of income than salary.

# Income from Various Sources

IN THE HIGH COURT OF KERALA AT ERNAKULAM

P.UBAID, J.

Crl.A.No. 322 of 2000

Dated this the 17th day of November, 2016

CC 22/1994 OF ENQUIRY COMMISSIONER & SPECIAL COURT, THRISSUR

APPELLANT/ACCUSED

K.V.MATHAI, KOTHAMANGALAM.

BY ADV. SRI.B.RAMAN PILLAI

RESPONDENT/COMPLAINANT

STATE, REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM.

BY PUBLIC PROSECUTOR SRI.JUSTIN JACOB

J U D G M E N T

The appellant herein retired from Government service as Inspector of Agricultural Income Tax and Sales Tax. On the allegation that, while working as Inspector of Sales Tax and Agricultural Income Tax, Kothamangalam during the period from 1.4.1980 to 20.5.1986, he had acquired assets disproportionate to his known-sources of income, the appellant faced prosecution before the learned Enquiry Commissioner and Special Judge (Vigilance), Thrissur in C.C.No. 22 of 1994. On the basis of some information or complaint regarding such amassement of wealth, the Vigilance and Anti-Corruption Bureau, Ernakulam conducted a preliminary enquiry, and found some materials substantiating the allegations. Accordingly, the VACB registered a crime against the appellant as V.C. No. 4 of 1986, and proceeded for investigation. During investigation, the VACB found that the appellant had acquired income and assets worth ₹ 2,20,776/- in excess of what he could have legitimately earned and acquired as a public servant. The VACB assessed the total value of assets as on 1.4.1980 as ₹1,64,420.79/-, the value of assets as on 20.5.1986 as ₹5,41,574.87/-, the total income during the check period as ₹5,90,783.72/-, and the total expenses during the check period as ₹4,34,395.71/-.

2. The appellant appeared before the trial court, and pleaded not guilty to the charge framed against him under

# Section 5(2) read with Section 5(1)(e) of the Prevention of Corruption Act, 1947

The prosecution examined 77 witnesses and marked Exts. P1 to P232 documents during trial. When examined under Section 313 Cr.P.C., the accused denied the incriminating circumstances, and projected a defence that he had much income from various sources including agriculture and finance business, that his income from all sources was not assessed by the VACB during investigation, and the VACB happened to find excess acquisition of money and wealth only because the properties were not properly valued, and the income was not properly assessed. To prove the different sources of income, and also to prove valuation and assessment wrongly made by the officers of the VACB, the accused examined 10 witnesses, and marked Exts. D1 to D13 documents.

3. On an appreciation of the evidence adduced on both sides, the trial court found the prosecution allegations true to an extent, and accordingly found him guilty. On conviction, he was sentenced to undergo rigorous imprisonment for four years, and to pay a fine of ₹2,25,000/- under Section 5(2) read with Section 5(1)(e) of the Prevention of Corruption Act, 1947, by judgment dated 29.5.2000. Aggrieved by the judgment of conviction, the accused has come up in appeal.

4. When this appeal came up for hearing, the learned senior counsel for the appellant submitted that the appellant is entitled for acquittal on factual as well as legal grounds, in this case. As regards the legal aspects, the learned senior counsel submitted that the very FIR in this case is baseless, or it is not supported by necessary materials as provided under the law, and that the whole prosecution is barred for the reason that there is no proper and legal sanction to prosecute the accused as required under the law, or that the sanction produced and marked by the prosecution stands not properly and legally proved. As regards the factual aspects, the learned senior counsel submitted that the various assets including immovable properties in the possession of the accused and his wife were not considered or assessed by the VACB properly and legally, that the income from various source was not properly assessed, or that income from so many sources including the appellant’s wife’s source as a teacher, was omitted by the Vigilance, and that the expenses during the check period were also not properly assessed. On the other hand, the learned Public Prosecutor submitted that the VACB submitted final report in court after proper assessment and valuation, and that the prosecution sanction is proved by the competent person.

5. Before going to the factual aspects as regards the assets, sources of income, value of assets, expenses, etc., let me examine the legal aspects raised by the defence regarding the F.I.R. and the prosecution sanction.

6. Ext.P160 is the prosecution sanction granted by the Commissioner and Secretary to the Government, Vigilance (D) Department. This sanction was marked through PW41, who was only an Under Secretary of the Vigilance Department at the relevant time. PW41 identified the signature of the Secretary and the Commissioner, who granted the sanction, and further stated that it was granted after examination of the relevant records and documents. She did not explain what all documents and materials were perused or examined by the Secretary, or how the Secretary came to a finding on the facts alleged by the Vigilance. The value of evidence given by this witness is only that she just identified the signature of the Commissioner and Secretary, who issued the sanction order, and nothing more. She does not know the details of the examination made by the Commissioner and Secretary, or the details of the materials and documents examined or perused by him.

7. In

# CBI v. Ashok Kumar Aggarwal, AIR 2014 SC 827

the Hon’ble Supreme Court held that the sanctioning authority under the Prevention of Corruption Act will have to do complete and conscious scrutiny of the whole materials placed before it, and the authority is bound to consider all the materials properly, and apply his mind independently to the facts and the materials, before taking decision on the request to grant sanction. The object of prosecution sanction under the Prevention of Corruption Act is to prevent wrong prosecutions or vexatious prosecutions, and to ensure that a corrupt public servant is prosecuted only on the basis of definite materials. The Hon’ble Supreme Court also held that the sanction order should show that the authority has considered all the relevant aspects and materials placed before it.

8. In this case, the prosecution sanction was granted by the Commissioner and Secretary to the Government, whereas, the person brought by the prosecution to prove the document is only an under Secretary. Practically and legally, the prosecution sanction only stands marked, and not proved according to law. An identical situation came up before this Court in

# Antony Cardoza v. State of Kerala, 2011 (1) KLT 946

In the said case, the prosecution examined an Under Secretary to prove a prosecution sanction granted by the Principal Secretary. This Court held in the said case that independent application of mind and consequent satisfaction arrived at for granting sanction are matters, which can be proved only by the sanctioning authority, and that when the prosecution sanction including independent application of mind is not proved properly by the sanctioning authority, it cannot be said that the prosecution sanction is legally proved. Following the earlier decisions of this Court, and of the Hon’ble Supreme Court, this Court held in

# Gurudas v. State of Kerala, 2015 (3) KLT 749

that the prosecution sanction granted under Section 19 of the Prevention of Corruption Act will have to be proved by the right person, as provided under the Indian Evidence Act. The burden of proving the essentials as regards sanction, that it was granted on an independent application of mind, and after consideration of all the relevant materials and documents, cannot be taken over by somebody else, who had no role or involvement in the process of granting sanction. In very many cases, this Court could come across instances where the prosecution sanction was just marked by the Investigating Officer. In

# Savithri v. Deputy Superintendent, Vigilance and Anti Corruption Bureau, 2015 (3) KLT 909

this Court held that the Investigating Officer is not the right and competent person to prove a prosecution sanction granted by some other authority under the Prevention of Corruption Act.

9. In

# State of Maharashtra through CBI v. Mahesh G. Jain, 2014 (1) SCC (Crl.) 515

the Hon’ble Supreme Court formulated some principles and guidelines on a consideration of the earlier decisions on the point, as to how and what a prosecution sanction should be, and how it should be granted. Those are;

(i) It is incumbent on the prosecution to prove that a valid sanction has been granted by the sanctioning authority on a satisfaction that a clear case for sanction, or definite materials for a prosecution, has been made out.

(ii) The sanction order may expressly show that the sanctioning authority has perused the materials placed before it, and after consideration of the circumstances, has granted sanction for prosecution.

(iii) The prosecution may prove by adducing evidence that sufficient materials were placed before the sanctioning authority, and its satisfaction was arrived at on a perusal of the materials placed before it.

(iv) Grant of sanction is only an administrative function, and the sanctioning authority is required to prima facie reach the satisfaction that relevant facts would constitute the offence.

(v) The adequacy of materials placed before the sanctioning authority cannot be gone into by the court as it does not sit in appeal over the sanction order.

(vi) The order of sanction is a pre-requisite as it is intended to provide a safeguard to a public servant against frivolous and vexatious litigations, but simultaneously an order of sanction should not be construed in a pedantic manner, and there should not be a hyper-technical approach to test its validity.

10. In cases like this where amassement of wealth or assets disproportionate to the known-source of the income is alleged, there is a heavy duty on the part of the sanctioning authority to consider the materials placed before it meticulously and judiciously to decide whether the prosecuting agency has done things properly and valued the assets, income, expense etc. properly to warrant a prosecution. In this case, I am well satisfied that such things were not in fact considered by the sanctioning authority, because those details are not available from Ext.P160 prosecution sanction. PW41, who marked the sanction order, is not the competent person to grant the sanction. Her evidence does not convince the court that things and materials were properly assessed or examined, or that mind was independently applied by the Commissioner and Secretary in the process of granting sanction. The prosecution does not have any explanation why the Commissioner and Secretary who granted sanction, was not examined. In very many cases and instances, this Court could find the prosecution sanction being simply marked by the Investigating Officer or by somebody else just claiming to be familiar with the signature of the sanctioning authority. Such a practice cannot be accepted in view of the proposition settled by the Hon’ble Supreme Court. In this case, I find that the prosecution sanction stands not properly and legally proved. This prosecution is accordingly barred under Section 6 of the Prevention of Corruption Act, 1947 (Section 19 of the Prevention of Corruption Act, 1988), and I find that on this legal ground itself, the appellant is entitled for acquittal.

11. Now, let me come to the other important legal aspect raised by the defence, as to whether the prosecution in this case has any basis, or whether the F.I.R. in this case has any factual basis.

12. Every First Information Report registered under Section 154 of the Code of Criminal Procedure must have a solid factual basis or foundation. A prosecution without such strong foundation must necessarily collapse. Ext.P185 F.I.R. in this case shows that this crime was registered by PW57 on the basis of a sanction issued by the Superintendent of Police, Vigilance as per the proceedings dated 17.5.1986. The records reveal that such a sanction was granted by the Superintendent of Vigilance on the basis of a report of preliminary enquiry. Such a report is not before the court. It is not even seen mentioned or referred to by any of the Investigating Officers during trial. It is not known whether the VACB had received any definite complaint from anybody against the appellant. It is not known how, without any report or complaint, an enquiry happened to be made against the appellant. When the FIR is based on a definite material; be it a complaint, or a report of enquiry, or any other material, the said material must be produced in court, and it must be proved as the basis of the FIR. The First Information Report, which does not have any basis, or which arose from no definite source, or which cannot claim any source of information revealing the commission of a cognizable offence, cannot be called a First Information Report having sanctity and acceptability under Section 154 of the Code of Criminal Procedure. It is settled law that mere proof of FIR will not amount to proof of the contents of the FIR. When a First Information Report is based on a complaint or a report, or any other material, that complaint or material must be proved in evidence as part of proof of the FIR. The person who registered the FIR can only prove registration of the FIR, and he cannot prove anything more. He can prove the contents of the FIR only if he is the reporting source, or if he registered the FIR on the basis of the informations or materials received by him, or on the basis of his own personal knowledge, revealing the commission of a cognizable offence. In such cases, we will call it a “suo motu FIR”.

13. In Savithri‘s case cited supra, the VACB conducted an enquiry on the basis of a written complaint. Though there was such a complaint, the FIR in that case was registered on the basis of a report of enquiry submitted by the Deputy Superintendent of Police. The said report was not produced in court by the VACB, but the complaint was produced in court. In the said case, the prosecution did not examine the complainant to prove the complaint, or to prove the information or materials revealing the commission of the cognizable offence. In Savithri‘s case, this Court held that whatever be the material that revealed the commission of a cognizable offence, that material must be proved in evidence as part of proof of the FIR, and that when investigation in a case proceeded on the basis of a First Information Report revealing commission of a cognizable offence, registered on the basis of any complaint or report, the complainant or the person who reported the offence must be examined to prove the complaint. In this case, it is not known what exactly is the actual basis of the crime. There is reason to believe that a fact finding enquiry was conducted by the VACB on the basis of some material or report or complaint. It is not known what it is actually. Anyway, such a material is not seen produced in court. Even the report of enquiry on the basis of which the District Superintendent of Police authorized the Deputy Superintendent of Police to register FIR, is not seen produced in court. What is available before the Court is only the FIR. This is not a case of ‘suo motu FIR’ where the Deputy Superintendent of Police registered the FIR on the basis of his knowledge or information or on the basis of the materials collected by him. In the above circumstances where the FIR in this case does not have solid factual basis or foundation, the whole prosecution must necessarily collapse as an inevitable consequence.

14. Now, let me come to the facts of the prosecution case, and let me decide whether the prosecution has succeeded in proving that the appellant herein had amassed wealth or money or assets disproportionate to his known legitimate sources of income during the check period, taken by the VACB. A prosecution under Section 5(2) read with Section 5(1)(e) of the Prevention of Corruption Act, 1947 [Now Section 13(2) read with Section 13(1)(e) of the Prevention of Corruption Act, 1988] is quite different from a prosecution under the other Sections of the Prevention of Corruption Act. In a trap case, or in a case alleging dishonest misappropriation of public money by a public servant, the amount involved will always be definite and certain. But in a prosecution on the allegation of amassement of wealth or assets disproportionate to the known-sources of income, the duty is heavy on the prosecution to prove all the required details regarding the assets and the income of the accused. The amount of income, or the value of assets, in such a prosecution, may not be always definite or certain. It must be the concern of the prosecution, and a duty also, to ensure that the necessary figures regarding the assets and income of the accused are presented before the court to the satisfaction of the court, or on a proper assessment made reasonably, rationally and realistically. In such a prosecution alleging amassement of wealth disproportionate to the known-sources of income, the prosecuting agency is bound to tell the court what exactly are the known sources of income, what exactly was his income from each such source, and to what extent wealth was amassed by the accused, disproportionate to such known-sources of income. In such a prosecution, the assets of the accused must be properly valued, and the income must be properly assessed, though mathematical precision may not be possible. Of course, some guess work will have to be made in making such assessment and valuation. But such guess work shall be something justifiable on the touchstone of reasonableness and realistic approach. Though mathematical precision is not possible in such assessment, the prosecution will have to convince the court that income was assessed and assets were valued quite reasonably, on a realistic approach, applying the commonly accepted principles and methods of valuation. Such assessment or valuation shall not be whimsical, or simply imaginary. Now let me see how assessment and valuation was made in this case by the Investigating Officer before he proceeded to submit final report.

15. Along with the final report, the prosecution has submitted different statements containing assessment and valuation of different sources. The statement (A) contains the value of the assets of the appellant as on 1.4.1980 (the value assessed is ₹1,64,420.79/-), the statement (B) contains the value of assets as on 20.5.1986 (₹5,41,574.87/-), the statement (C) contains the total income during the check period assessed as ₹5,90,783.72/-, the statement (D) contains the expenses during the check period assessed as ₹4,34,395.71/-, and statement (E) contains the likely savings, assessed as ₹1,56,388/-. The learned senior counsel for the appellant submitted that the income from various sources during the check period was not properly assessed by the Investigating Officer, and that even value of the assets as on the commencement of the check period was not properly valued or assessed. One grievance of the appellant is that the income of the appellant’s wife from her properties and also from her profession as teacher was not considered by the Investigating Officer, and that the value of some constructions made by the appellant even prior to the commencement of the check period was added to the value of assets as on 20.5.1986. The major part of investigation was done by PW75, and after him, investigation was taken over by PW76. On a close scrutiny and examination of the evidence given by these two Investigating Officers, I find that income from different sources was either not taken or not properly assessed by the Investigating Officers, and that a high amount was assessed as expenditure during the check period. It has come out in evidence that the appellant and his wife had a total extent of nearly 12 acres of property including rubber plantation, as on the date of commencement of the check period. It is curious to note that the prosecution has not examined anybody competent, to prove the probable income from agricultural and other sources. The Investigating Officer has assessed the income from rubber plantation, income from paddy cultivation, income from other agricultural sources, income from salary, and also income by way of building rent. During cross examination, PW76 fairly conceded that assessment was not objectively or properly done by him, and that for assessment under various heads, he solely relied on the reports given by some agricultural officers, and some engineers. It is really funny that PW76 fairly admitted during cross examination that he simply accepted the statements of the others for assessment and valuation, and that he had not questioned anybody competent in the field, or collected any definite satisfactory material regarding the income from different sources, or the value of different items including furniture, ornaments and buildings. In view of the statements made by the Investigating Officers during trial, indicating that assessment of income and valuation of assets was not properly done with the help of competent persons in the field, I find that a detailed discussion on various aspects is not necessary. Still, I am inclined to probe into some aspects raised by the defence to substantiate and convince the court that proper and legal exercise was not done by the Investigating Officers in the process of valuation and assessment, before submitting final report.

16. One grievance of the appellant is that the value of the smokehouse and the coconut store attached to the residential building was improperly included in the value of the assets acquired during the check period, whereas, those constructions were actually made prior to the commencement of the check period. It has come out in evidence that the appellant and his wife have vast extent of rubber plantation, and they had income from such source as on the date of commencement of the check period. The coconut store and the smokehouse were valued by engineers. One witness examined is the Executive Engineer and the other is an Assistant Executive Engineer. There is reason to believe that these two engineers made assessment on the basis of the figures given by a Subordinate Officer. I find, on an examination of their evidence, that they had not in fact seen or inspected the building. These two engineers have no definite idea regarding the actual age of the building. During cross examination, a definite question was put to the Investigating Officer regarding the age of these two constructions, or the probable period at which these two constructions were made. Practically, the officer pleaded ignorance. This means that he does not have any idea as to when exactly these two constructions were made. The accused has adduced defence evidence proving that these constructions were made prior to 1.4.1980. One is a coconut store attached to the residential building, and the other is a smokehouse for drying the rubber sheets. In view of the evidence that even much prior to the commencement of the check period, the appellant and his wife had good income from agricultural sources like rubber plantation, coconut etc., the court will have to accept the defence version that these two constructions were in fact made prior to 1.4.1980. When the Investigating Officer has practically admitted during trial that the prosecution does not have any definite material proving the actual age of the buildings, or the probable date or period of construction of the two buildings, the court will have to accept the defence version, especially, in view of the evidence adduced by the defence, that these two constructions were made prior to the commencement of the check period, and that the value of these two constructions was wrongly included by the Investigating Officer in the statement (B) containing the value of the assets acquired during the check period. The total amount comes to 27,388/-, if at all the valuation ₹ is acceptable.

17. Admittedly, the wife of the appellant was a teacher. It has come out in evidence that the appellant and his wife had income from various sources other than salary. These sources include agricultural operations, building rent, interest received on money given to various persons as loan on various occasions, etc.. An examination of the evidence given by the Investigating Officer shows that income from such sources was not in fact assessed during investigation. The justification given by the VACB is that a Government servant is not allowed to lend money. This is a prosecution under the Prevention of Corruption Act, 1947, and not a prosecution under the Prevention of Corruption Act, 1988. As regards income from various sources, there is difference between the provisions of old Act and the new Act.

18. Two other aspects pointed out by the defence are regarding the value of ornaments and also the value of furniture. Various items of furniture were found at the house of the accused at the time of search, and some gold ornaments were also seized at the time of search.

19. The defence has raised serious dispute regarding the assessment of the quantity of ornaments, the value of furniture, the assessment and value of the building constructed during the check period, the assessment of income from agricultural sources, and also some income from other sources like cash in hand, gifts made by the father and the father-in-law of the accused, etc.. That things were not properly and legally valued or assessed, is well revealed by the evidence of the Investigating Officers.

20. Let me extract some statements of the Investigating Officers, given in answer to the questions during cross examination, by the learned defence counsel. Regarding the valuation of a building alleged to have been constructed during the check period, PW75 stated as follows:-

[Omitted]

(Had you enquired as to when the construction of the building was started, and when it was completed? (Q). The construction of the ground floor was completed in 1986.

(Ans.) This information was given by the neighbouring people. I have not recorded the statements of those persons. I do not know who exactly gave such details.)

This statement shows that the VACB is not certain when exactly the said building was constructed; as to whether it was during the check period or before it. This statement also shows that the valuation made regarding the said building is without any basis or data. Further discussion is not required regarding the assessment of the value of the said building alleged to have been constructed during the check period. Regarding the valuation of furniture, PW75 stated as follows:

[Omitted]

(I do not have the expertize to detect the nature and age of the wood of which furniture is made. xxxxxxxxx The nature of the wood can be detected only by an expert in the field. I do not know whether any such examination or assessment was done by PW8).

The evidence given by PW8 regarding assessment of the value of the furniture is that he had not inspected and detected as to what is the wood used for the furniture, and he had also not assessed the age of the furniture. In short, it is definite that the furniture were not properly valued, and even the nature and quality of the timber used for the furniture was not examined or assessed properly either by PW8 or by the Investigating Officer.

21. Another grievance of the defence is that the amount gifted by the father and the father-in-law of the accused was not taken into consideration by the VACB, and such amounts were not included in the statements appropriately. PW75 stated as follows regarding the amount gifted by the father of the accused:

[Omitted]

(The father of the accused has given statement that he had gifted 30,000/- ₹ to the accused.)

PW75 or PW76 has no explanation why this amount was not properly included in the statements appropriately. As regards the amount gifted by the father-in-law also, (₹25,000/-) the Investigating Officer has given such a statement that during investigation, the father-in-law had also stated regarding such a payment as gift. The said amount is also not seen included in any of the statements, as income of the accused during the check period. The prosecution did not examine the father or the father-in-law of the accused. It appears that deliberately the VACB gave up those witnesses, for fear that if they gave evidence regarding the payments made, such amounts will have to be accounted for, in the statements appropriately. Regarding the valuation of the building, PW75 further stated like this:

[Omitted]

(I did not enquire whether valuation of the building was made on the basis of the plinth area or the actual details of construction. The Asst. Engineer, who valued the building, was not questioned by me.)

22. Now let me come to the evidence given by PW76 who succeeded PW75 in the matter of investigation. This witness practically admitted that for the valuation of so many items and for the assessment of income, he had not adopted any independent or scientific method, and he had also not collected the right evidence on the point. Whenever asked about the various items, he conceded that he just accepted the statements given by the accused. This sort of assessment in a case like this is unheard of, that the Investigating Officer assessed the income or valued things without the aid of any competent person in the field, or just accepted what the accused said. There is absolutely no material to show that the accused had given any such statement, or that the VACB had accepted such statements for the purpose of valuation. It appears that when PW76 could not properly answer the questions from the defence regarding assessment of income and valuation of assets, he just washed his hands off, saying that for the assessment of many things he accepted the statements given by the accused. This deserves comments. Anyway, I am not inclined to make any harsh comments in view of his own statements that this is the case which he first investigated under the Prevention of Corruption Act. This is his explanation for the deficiency or flaw in investigation. As regards valuation of income from rubber plantations, PW76 stated like this:

[Omitted]

(Income from rubber shown in statement D, items IV and V was assessed with the help of officers of the Rubber Board.)

This means that such income was not properly and factually assessed by the Investigating Officer. It is not known how the officers or employees of the Rubber Board will say about the income derived by the accused from his own source. As regards the details of expenditure shown in Statement D, the witness stated like this:

[Omitted]

(The figures in items q and r in the statement D were assessed on the basis of the standard of living and the status of the accused, and also the statements given by the witnesses.)

He does not explain who among the witnesses has given such a statement, or how he assessed the standard of living or status of the accused to assess his expenses. No such witness is seen examined by the prosecution. If so, such an assessment will not have any legal value. This statement shows that the assessment of expenditure made by the VACB is simply on the basis of the statements given by some witnesses under Section 161 of Cr.P.C. No value can be attached to the said evidence regarding the assessment of expenses. Regarding the assessment of the standard of living and status of the accused, PW76 reiterated like this:

[Omitted]

(The status and standard of living of the accused was assessed on the basis of the statements given by the witnesses during investigation.)

If so, further discussion on this aspect is not required because, the said evidence is worthless.

23. It is an admitted fact that the wife of the accused had also income from agricultural sources, besides her income as a teacher. The evidence given by PW76 shows very well that the income of the wife from different sources was not considered or assessed by the Investigating Officer. He stated like this on this point:

[Omitted]

(The agricultural officers were not questioned by me for the purpose of assessment of income from agricultural sources of the accused and his wife. xxxxxxxxxxxx I had not inspected the agricultural properties of the accused and his wife.)

24. Regarding the gifts made by the father and the father-in-law of the accused, this witness pleaded ignorance during cross examination. Regarding the income from building rent also, the witness gave evasive answers, when cross examined by the learned defence counsel. He stated like this:

[Omitted]

(I do not remember the number of the buildings rented out by the accused. I do not know whether three such buildings were occupied by the tenants during the check period. I had questioned the tenants, but nobody is cited as a witness.)

In view of this admission made by the witness regarding such income and assessment, no value can be attached to his evidence. He had not made any enquiry regarding such income. Though the tenants were questioned by him, nobody is cited as a witness. His evidence shows that the accused and his wife had good income by way of rent, but no effort was made by the prosecution to assess this income, or to include such income in the total earnings during the check period. This will definitely cause serious prejudice to the accused, because every sort of income from various sources will have to be assessed and included in the statements. Omission to include income from various sources during the check period, or omission to include many items in the value of assets as on the commencement of check period will definitely cause serious prejudice to the accused. The evidence given by PW76 shows that the income from agricultural sources was not properly and factually assessed by him, and so the assessment made him will have to be rejected by the court. He stated like this:

[Omitted]

(Income from agricultural sources was assessed on the basis of assessment orders made by the officers, and also on the basis of the statements given by the agricultural income tax officers.)

Admittedly, no such witness is seen examined by the prosecution to prove such assessment. It is well settled that income from agricultural sources cannot be mechanically assessed on the basis of assessment orders or the statements given by the agricultural income tax officers. They are competent to assess income tax from agriculture, but they are not the competent persons to speak about the actual income from various agricultural sources. Persons in the field will have to be interrogated and examined by the prosecution to prove the actual or probable income from various agricultural sources. Such an exercise was not undertaken by the Investigating Officers in this case. The above extracted statements of PW76 shows unerringly that income from agricultural sources was not properly assessed by him or the other Investigating Officer, and so no value can be attached to the assessment made by the VACB regarding such income.

25. As regards the amount of ₹16,100/- shown as expenses in statement D, PW76 stated that he does not exactly know what the said figure is. However he stated that it must be the expenses for agricultural operations. If so, the said figure cannot be accepted because the income from agricultural sources is assessed after deducting the expenses met for such agricultural operations.

26. Curiously enough, PW76 stated as follows, as regards the income from rubber plantation:

[Omitted]

(I have not assessed the income from rubber plantation, and I have also not assessed the gross income from agricultural sources.) In view of such a statement, no value at all can be attached to the assessment of income from agricultural sources made by the Investigating Officers. The witness further stated like this:

[Omitted]

(I had not examined any property for the assessment of income.)

As regards the income prior to the commencement of the check period, the witness stated like this:

[Omitted]

(I had come to know that the accused had received an amount of 32,000/- from slaughter ₹ tapping of rubber as on 1.4.1980, and I had not made any enquiry regarding the income of the accused and his wife from agricultural properties as on 1.4.1980.)

27. As regards the period of construction of the coconut store and the smoke house, the witness fairly admitted that he has not collected any evidence or material to prove that these two constructions were made during the check period. As regards many of the items shown in statement B, the witness stated that he has not collected any material or document to show that these items were in fact purchased by the accused during the check period. In the statement (D), the Investigating Officer has given some figures as expenses met for purchase of ration articles including ration rice. But during cross examination, the witness fairly conceded that the accused had substantial income from agricultural operations, including paddy cultivation, and that he had no need at all to purchase ration rice. Admittedly, the appellant and his wife had not less than 11 acres of property, including three acres of rubber plantation and a vast extent of paddy land. Nobody has properly assessed the income from these sources, and it is definite that the accused had no necessity at all for purchasing ration rice. However, quite unnecessarily, some amount was shown as expenses for the purchase of ration rice in the statement D by the Investigating Officer. This deserves comments by the court. What is stated as expenses is in fact something which the accused had not met actually. So also, there is some discrepancy regarding the expenses shown for daily travel of the accused. In statement D, the VACB has shown some amount by way of expenses for the maintenance of the motor cycle of the accused, and some expenses for travel purposes daily. PW76 would admit that the maintenance charges for the motor cycle shown in the statement D would include petrol expenses also. If so, there is no explanation why some other amount is shown as travel expenses.

28. On an examination of the evidence given by PWs 75 and 76, I find that income from various sources was not properly assessed by the two officers, and the value of different items of movable and immovable properties was also not properly assessed. In the case of a public servant, whose income is only salary, or who does not have income from other sources, assessment is very easy. But in the case of a public servant having income from various sources, including agricultural sources, the task must be heavy on the investigating agency to assess income properly. In this case, on an examination of the evidence given by PWs 75 and 76, I find that the whole exercise of assessment undertaken by the two officers was nothing, but guess work without any data or basis or precision. It is definite that movable and immovable properties were not properly valued by the Investigating Officers, and the income of the accused and his wife from different sources was not properly assessed. Anyway, let me come to some of the aspects raised by the defence, and see how irresponsibly and baselessly things were done by the Investigating Officers.

29. The quantity of gold in the possession of the accused and his wife shown in the search list, and physically seen by PW57 at the time of search is 175.900 grams. On investigation, the VACB could find that the accused had pledged 184.400 grams in Bank, and that the accused had purchased 158.300 grams of gold ornaments during the check period. There is absolutely no piece of paper or other evidence to show that the accused or his wife had purchased any gold ornament during the check period. If so, it is not known how or on what basis the Investigating Officer assessed the total quantity of gold in the possession of the accused at the end of the check period. It is quite definite that assessment was made purely on a guess work by the officer. 8,850/- is the amount shown as the ₹ cost of furniture in the statement. It is not known how this amount was assessed. Admittedly, nobody competent in the field was consulted or questioned for such an assessment. The value of gold wrongly included in the statement of assets acquired during the check period will have to be deducted, because it does not have any factual foundation.

30. The accused has adduced satisfactory defence evidence by examining DW3 and DW7. These two witnesses were not effectively cross examined by the prosecution. This evidence is regarding the gift of ₹30,000/- by the father of the accused, and gift of another amount of ₹25,000/- by the father-in-law. Another amount of ₹7,000/- claimed by the accused as cash in hand was also not considered by the VACB in the process of assessment. It has come out in evidence that the father and the father-in-law were really substantial and affluent enough to gift or provide money or property to their children. There is nothing unusual or unnatural or unbelievable in the defence projected by the accused, as regards the gifts made by the father and the father-in-law. The value of the gold ornaments alleged to have been purchased by the accused during the check period is assessed as ₹ 26,383/-, This, and also the value of furniture must necessarily be deducted. Thus, I find that amount under various heads shown by the Investigating Officer in the different statements will have to be either excluded or properly added. Had the exercise of assessment and valuation been properly made by the Vigilance, it would have been found that there was no amassment of wealth disproportionate to the known-sources of income, or that if at all there is anything in excess, it would not exceed the marginal 10% allowed by precedents.

31. On an appreciation of the entire evidence as discussed and examined above, I find that valuation of the assets and assessment of income was not properly and rationally done by the prosecution in this case. What I find is that everything was an exercise of guess work, and the different statements filed by the prosecution along with final report showing the value of assets, income, expenses etc., do not have any factual basis or foundation. Had things been done properly on a realistic approach, the prosecution would not have come to a huge figure of difference between earnings and the value of assets acquired during the check period. I find that a huge amount inclusive of income from agricultural sources was suppressed by the prosecution, and this will have to be added to the total income during the check period. The Investigating Officers do not have any idea regarding the income from agricultural sources of the accused and his wife. Admittedly, the wife of the accused is a teacher, and she has also some properties of her own. I find that the expenses were also not assessed properly by the VACB. Some amount wrongly shown in the statement D by way of expenses will have to be deducted. On a close scrutiny and examination of the entire evidence, and also in view of the admissions made by the two Investigating Officers, that income was not properly assessed from various sources, including agricultural operations, or that valuation of different assets including buildings was not properly done, I find that the prosecution in this case has failed to prove convincingly or beyond reasonable doubt, that the accused had amassed wealth disproportionate to his legitimate sources of income. Even otherwise, I have found that the appellant is entitled for acquittal on legal aspects. As already observed, the appellant is a person having income from different sources, including his wife’s salary and agricultural income. The appellant and his wife belong to well to-do families having substantial assets and income from various sources. When such a person is being prosecuted, the task must be heavy on the prosecution to assess things properly. This is not the case of a public servant having no other source of income than salary. Had this been a case of such a public servant, things would have been very easy, and the amassment of wealth disproportionate to the income from salary could very well have been easily assessed.

32. The evidence given by PWs 75 and 76 would convince the court that to bring a prosecution against the accused, they made some sort of assessment without any factual basis, and without applying the mind. Without a proper valuation of assets, and a proper assessment of income and expenditure, the prosecution cannot prove that the public servant had amassed wealth disproportionate to his legitimate sources of income, and the court cannot accept such a prosecution brought simply on the basis of some guess work. I find that the appellant is entitled for acquittal in this case, on factual and legal grounds. Factually, things are not properly proved to the satisfaction of the court and beyond reasonable doubt, and legally the prosecution must collapse, because the FIR does not have any basis, and the prosecution sanction does not have any sanctity for the reason that it is not properly and legally proved. The accused being a person having substantial assets and income from various sources, including the income of his wife, who is a teacher, meticulous examination was done by the court on the various aspects. Something in excess here and there cannot be said to be excess amassment of wealth, or illegal amassment of wealth in the case of the appellant herein, because he is not a person having no other source of income than salary.

In the result, this appeal is allowed. The appellant is not found guilty of the offence punishable under Section 5 (2) read with Section 5(1)(e) of the Prevention of Corruption Act, 1947, and accordingly, he is acquitted of the said offence in appeal under Section 386(b)(i) of Cr.P.C. The conviction and sentence against the appellant in C.C.No. 22 of 1994 of the court below will stand set aside, and the appellant will stand released from prosecution. The bail bond, if any, executed by him will stand discharged.

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