2021 (1) TMI 859 - HC - VAT and Sales Tax

Refund-set off - allegation of false claim for set-off (refund of sales tax) admissible to dealers, engaged in the business of extracting oil from power oil ghanas, whose sales were exempted under Entry No.39, Schedule A appended to the Bombay Sales Tax Act - offences punishable under Sections 120-B, 409, 420, 468, 471, 477-A read with Section 109 of the Indian Penal Code and under Sections 5(2) read with Section 5(1) (d) and 5(1)(c)of the Prevention of Corruption Act, 1947 - HELD THAT - The prosecution had examined the officers of the Sales Tax Department. The tenor of the evidence of Assistant Commissioner is not suggesting that the assessment orders passed by Mr. Kagane, which resulted in refund-set-off, were illmotivated; but were incorrect and illegal orders due to procedural irregularity committed by him. Therefore, it is to be said that the conviction recorded by the learned trial Court was to a great extent, based on the evidence of the approver. Upon excluding approver s evidence, the remaining evidence was not sufficient to establish beyond reasonable doubt that the deceased had committed the offences for which he was charged and tried - Appeal allowed - decided in favor of appellant.

Summary

Issues Involved:
Conviction and sentencing of the accused under various sections of the Indian Penal Code and the Prevention of Corruption Act based on fraudulent activities related to sales tax refunds. Grant of pardon to an approver and its impact on the trial proceedings. Reliability of evidence, especially that of the approver, in establishing guilt beyond a reasonable doubt.

Issue 1: Conviction and Sentencing of the Accused
The judgment details the conviction and sentencing of the accused, Suresh Damodar Kagane, under multiple sections of the Indian Penal Code and the Prevention of Corruption Act. The accused, a Sales Tax Officer, was found guilty of offenses like conspiracy, forgery, and corruption related to fraudulent claims for sales tax refunds. The prosecution presented evidence of collusion between the accused and others to make false claims for tax refunds, resulting in financial losses to the state. The accused's actions were deemed illegal and resulted in significant prison sentences and fines.

Issue 2: Grant of Pardon to an Approver
The judgment discusses the grant of pardon to an approver, who played a crucial role in the trial proceedings. The approver, accused no.4, was pardoned after examining a significant number of witnesses. The judgment highlights the risks associated with relying on an approver's testimony, especially when granted pardon late in the trial process. The judgment emphasizes the importance of the approver being a reliable witness and criticizes the timing of the pardon granted to the approver in this case.

Issue 3: Reliability of Evidence and Acquittal
The judgment further analyzes the reliability of the evidence presented in the trial, especially focusing on the testimony of the approver. It notes that the trial heavily relied on the approver's evidence to establish guilt. However, subsequent judgments in related appeals raised doubts about the credibility of the approver's testimony. The court, after excluding the approver's evidence, found that the remaining evidence was insufficient to establish the deceased accused's guilt beyond a reasonable doubt. Consequently, the court acquitted the deceased accused of all charges and ordered the refund of any fines paid to the legal heirs.

In conclusion, the judgment delves into the complexities of the trial process, including the reliance on an approver's testimony, the impact of late pardon grants, and the importance of establishing guilt beyond a reasonable doubt. The detailed analysis of the evidence and subsequent acquittal of the accused shed light on the intricacies of legal proceedings and the standards required for conviction in criminal cases.