2022 (9) TMI 1549 - SC - Indian Laws

Application for discharge filed by the Appellant under Section 227 of the Code of Criminal Procedure, 1973 - whether the Appellant is entitled to be discharged of the proceedings initiated against him under the PC Act? Inclusion an amount of Rs. 55,000, recorded as the balance amount in the Appellant s bank account during the check period - HELD THAT - The difference in the figures was not explained by the Prosecution. Accordingly, the Special Judge (Vigilance) and the High Court failed to reconcile such a simple and straightforward inconsistency in the Prosecution s evidence. It is opined that only an amount of Rs. 11,998, recorded in the Appellant s Bank Passbook during the check period as the balance amount, is validly admissible as expenditure under this head. Inclusion of an amount of Rs. 53,467 as expenditure towards repayment of the loan from the BSFC - HELD THAT - The amount repaid towards loan instalments was already deducted from Appellant s gross salary, and the deducted figure was recorded as the total disposable income with the Appellant during the check period. Hence, the loan repayment cannot be separately counted as an expenditure yet again. This is a glaring mistake. The Special Judge (Vigilance) as well as the High Court did not consider this objection on the ground that a roving inquiry is not permissible the stage of discharge. Inclusion of Rs. 1,58,562 as the value of the articles found during a search conducted in Appellant s house on 21.02.2000, twelve years after the check period of 1974 to 1988 - HELD THAT - There is nothing to indicate, even prima facie, that these articles found during the search in the year 2000 were acquired during the check period. In the absence of any material to link these articles as having been acquired during the check period, it is impermissible to include their value in the expenditure. It is opined that the Appellant s objection about inclusion of this amount in the list of expenditure is fully justified. Unfortunately, even this objection, which did not require much scrutiny of the material on record, was not considered by the Special Judge (Vigilance) or the High Court. The Special Judge (Vigilance) was bound to conduct a similar inquiry for coming to a conclusion that a prima facie case is made out for the Appellant to stand trial. Unfortunately, the High Court committed the same mistake as that of the Special Judge (Vigilance). Appeal allowed.

Summary

Issues Involved:

1. Whether the Appellant is entitled to be discharged of the proceedings initiated against him under the Prevention of Corruption Act, 1988.
2. Whether there were errors in the calculation of the Appellant's income and expenditure during the check period.
3. Whether the Special Judge (Vigilance) and the High Court erred in dismissing the Appellant's application for discharge under Section 227 of the Code of Criminal Procedure, 1973.

Detailed Analysis:

1. Entitlement to Discharge under the Prevention of Corruption Act, 1988:

The core issue was whether the Appellant should be discharged from proceedings under the Prevention of Corruption Act, 1988, based on the allegations of possessing assets disproportionate to his known sources of income. The Appellant argued that the calculations of his income and expenditure were erroneous, and these errors were sufficient grounds for discharge. The Supreme Court scrutinized the materials on record and found significant discrepancies in the prosecution's case, leading to the conclusion that there was no prima facie case against the Appellant. Consequently, the Appellant was entitled to discharge.

2. Errors in Calculation of Income and Expenditure:

The Appellant highlighted specific errors in the calculation of his income and expenditure during the check period from 1974 to 1988:

- Bank Balance: The charge sheet recorded a balance of Rs. 55,000 in the Appellant's bank account, while the actual balance was Rs. 11,998 as per the Bank Passbook. The prosecution failed to explain this discrepancy.
- Loan Repayment: The charge sheet included Rs. 53,467 as expenditure towards loan repayment, which had already been deducted from the Appellant's gross salary. This resulted in double counting of the same amount.
- Value of Articles: The charge sheet included Rs. 1,58,562 as the value of articles found during a search in 2000, which was twelve years after the check period. There was no evidence to link these articles to the check period.

These errors were not considered by the Special Judge (Vigilance) or the High Court, who dismissed the objections on the grounds that a roving inquiry was not permissible at the stage of discharge. The Supreme Court, however, found these objections justified and concluded that the corrected expenditure was Rs. 2,69,355, not Rs. 5,24,386, as alleged.

3. Errors by Special Judge (Vigilance) and High Court in Dismissing Discharge Application:

The Special Judge (Vigilance) and the High Court dismissed the Appellant's application for discharge without adequately scrutinizing the material on record. The Supreme Court emphasized that while considering an application under Section 227 of the Cr.P.C., the judge must sift and weigh the evidence to determine whether a prima facie case exists. The lower courts failed to conduct this necessary inquiry and dismissed the application on the grounds that a roving inquiry was not permissible. The Supreme Court clarified that the inquiry it conducted was not a roving inquiry but a necessary one to adjudicate the discharge application properly.

Conclusion:

The Supreme Court allowed the appeal, set aside the judgments of the High Court and the Special Judge (Vigilance), and discharged the Appellant. The Court noted with distress the prolonged delay in the proceedings and the unjust continuation of the prosecution, given the Appellant's age and the errors in the prosecution's case. The Appellant was discharged, and no order as to costs was made.