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TMI Blog2006 (1) TMI 636X X X X Extracts X X X X X X X X Extracts X X X X ..... t was corrupt and had amassed assets disproportionate to his income, R.C. No. 33 of 1986 was registered on 28.5.1986 by the Superintendent, Central Bureau of Investigation, Madras. Chelladurai, Inspector CBI [PW- 23] took up the case for investigation and obtained a warrant for inspection of the appellant's house No. 16, North Colony, Railway Quarters, Dindigul, from the Chief Judicial Magistrate, Chennai. On 29.5.1986, PW-23 along with his party and two independent witnesses went to the house of the accused. Appellant was not present but his son was present. The search was commenced at 8 A.M. The appellant came around 11.30 A.M. and his wife came around 2.45 P.M. There were three steel almirahs kept in the house of the appellant and on opening them with the keys provided by the appellant, a sum of ₹ 2,94,615/- in cash was found in ten different containers (biscuit tins, briefcases, etc.,) which was seized. Certain documents were also seized. 2.3 As per the charge-sheet dated 18.5.1987, the check-period was 1.5.1976 to 29.5.1986 and the value of the assets held by the appellant at the beginning of the check period (1.5.1976) was ₹ 13,449/17; and the Page 0005valu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the House at Salem [taken as ₹ 1,08,740/- as against the actual cost of construction being ₹ 80,000/-] = ₹ 28,740/- (vi) Difference in value of assets as on 1.5.1976 [Rs.63,198.61 claimed by the appellant less ₹ 13,449.17 assessed by PW-23] = ₹ 49,749/44 (vii) Difference in income received during the check period 1.5.1976 to 29.5.1986 (Rs.3,16,076.30 claimed by the appellant and ₹ 2,81,497.97 assessed by PW-23) (Note: The said difference relates to difference in receipt of interest on fixed deposits) = ₹ 34,578.37 Total = ₹ 4,36,990.41 The appellant submitted that the extent of assets beyond the known sources of income was not, therefore, ₹ 4,63,551/40 as charged, but only ₹ 26,561/-. The appellant contended that a margin of 10% is permitted and as the unexplained assets were only to an extent of ₹ 26,561/- which was less than even 10% of the total income, the courts below committed an error in holding that the assets possessed by the accused were disproportionate to his known sources of income, so as to justify the raising of presumption under Section 5(3). 4. The special court after considering the e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... #8377; 8,000/- (bonus), ₹ 34,083/- (being part interest on fixed deposits, that is by taking the interest earned as only ₹ 57,583.91 instead of ₹ 91,666.25 claimed by the appellant) and ₹ 511/- (S.B. Account interest). It did not accept his contention that the value of the Salem house was only ₹ 80,000/- and took it as ₹ 1,13,042/-, thereby increasing the assets by an extent of ₹ 28,740/-. Consequently, out of ₹ 6,69,852.78 (value of assets as on 29.5.1986), the High Court deducted ₹ 63,198.61 (being the value of assets at the beginning of check period as claimed by the appellant) and ₹ 1,92,852.01 (surplus of income over expenditure during the check period as determined by it) and concluded that assets of the value of ₹ 413,802.16 remained unexplained. 6. The said decision is challenged in this appeal by special leave. The learned Counsel for the appellant contended that the High Court committed a serious error in over-estimating the cost of the Salem house and by refusing to take note of the following five items of income during the check period: (i) ₹ 2,50,000.00 Loans received from PW-11 and PW-15 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lleged loan of ₹ 2,50,000/-. 8. The appellant's case is that he had taken a loan of ₹ 1,25,000/- from PW-11 and another sum of ₹ 1,25,000/- from PW-15 on 24.5.1986 (five days before the search) and the same was evident from the promissory notes [Ex. P-64 P-65], guarantee letters [Ex.P-66 P-67], confidential letter [Ex.P-68], equitable mortgage deed [Ex.P-69] and the entries in the account books of PW-11 and PW-15 [Ex.P-70 to P-81]. He submits that the said documentary evidence proved beyond doubt that he had received ₹ 2,50,000/- as loan from PW-11 and PW-15. 9. We may briefly refer to the evidence of PW-11 and PW-15 who were the alleged creditors. 9.1 Chandiram (PW-11) stated that he was carrying on money- lending business at Salem in partnership with his mother and three brothers, from the year 1984 under the name and style of 'Pahlaprai Sons'; that Satram Das (PW-15) was his paternal uncle and he was also doing money lending business under the name and style of 'Satramdas Mahesh Kumar'; that whenever money was to be lent, he was taking a promissory note, guarantee letter, confidential form etc. from the borrower; and that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rm'. All the three brothers of appellant signed the guarantee letteRs.To create a document to show that the appellant's house at Salem was also given as security by way of equitable mortgage for such loan, appellant's brother Ramachandran along with PW-11's clerk went to a stamp vendor to obtain an ante-dated stamp paper with the date of 23.5.1986 in the name of the appellant. Thereafter, the appropriate entries were made in the pronote entry book and in the respective day book and cash book, showing ₹ 1,25,000/- was advanced by the firm of PW- 11 and another ₹ 1,25,000/- by the firm of PW-15. After the entries were made, the three brothers of the appellant took the promissory notes, guarantee letters, confidential form, equitable mortgage document stating that they will get the signatures of the appellant and later brought back those documents and delivered them on 1.6.1986 with the signatures of the appellant. Along with the said loan documents, they also gave two alleged 'title deeds', that is, a certificate showing the ownership of the appellant in regard to the house at Salem [Ex. P-82] and two electricity bills [Ex. P-83 series]. PW-11 stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there was nothing to show that the entries shown as relating to the lending were really made on 30.5.1986 and not on 24.5.1986. He also stated that though appellant's brothers agreed to give commission to him and PW-15, actually no commission was given to either of them. He also denied that he and PW-15 offered to give statements under Section 164 Cr.P.C. before the Magistrate at Chennai only under pressure from the CBI. He admitted that the CBI did not examine them until they gave the statements under Section 164 Cr.P.C. 9.5 To the similar effect is the evidence of PW-15 [J. Chatram Doss]. His sworn statement under Section 131 of Income Tax Act recorded by PW-14 is Ex.P-92 and his statement under Section 164 Cr.P.C. recorded by the Addl. Metropolitan Magistrate, Chennai is Ex.P-96. 10. The evidence of PW-11 and PW-15 are clear and categorical that ₹ 2,50,000/- was not advanced to appellant on 24.5.1986 or any other date and that documents (Ex.P-64 to P-69) and the entries (Ex.P-70 to P-81) were created only on 30.5.1986 to help appellant to explain the huge cash found in his possession. Nothing has been elicited in the cross-examination to disbelieve their evidence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purpose of creating evidence about some other matter. 11.2 In Krishna Bai v. Appasaheb AIR 1979 SC 1880, this Court observed: when there is a dispute in regard to the true character of a writing, evidence de hors the document can be led to show that the writing was not the real nature of the transaction, but was only an illusory, fictitious and colourable device which cloaked something else, and that the apparent state of affairs was not the real state of affairs. 11.3 We may next refer to the following observations in Gangabai v. Chhabubai interpreting Section 92: 11. Section 91 of the Evidence Act provides that when the terms of a contract, or of a grant, or of any other disposition of property, have been reduced to the form of a document, and in all cases in which any matter is required by law to be reduced to the form of a document, no evidence shall be given in proof of the terms of such contract, grant or other disposition of property, or of such matter, except the document itself, Sub-section (1) of Section 92 declares that when the terms of any contract, grant or other disposition of property, or any matter required by law to be reduced to the form of a documen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... being. An enquiry into reality of transaction is not excluded merely by availability of writing reciting the transaction. 11.6 We may cull out the principles relating to Section 92 of the Evidence Act, thus: i) Section 92 is supplementary to Section 91 and corollary to the rule contained in Section 91. ii) The rule contained in Section 92 will apply only to the parties to the instrument or their successors-in-interest. Strangers to the contract Page 0013 (which would include the prosecution in a criminal proceeding) are not barred from establishing a contemporaneous oral agreement contradicting or varying the terms of the instrument. On the other hand, Section 91 may apply to strangers also. iii) The bar under Section 92 would apply when a party to the instrument, relying on the instrument, seeks to prove that the terms of the transaction covered by the instrument are different from what is contained in the instrument. It will not apply where anyone, including a party to the instrument, seeks to establish that the transaction itself is different from what it purports to be. To put it differently, the bar is to oral evidence to disprove the terms of a contract, and not t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to show that the appellant was negotiating for purchase of any property at Coimbatore or that he wanted money for purchase of such property. Neither the particulars of such property at Coimbatore nor the terms of such sale have been disclosed. ii) The stamp paper on which the alleged mortgage by deposit of title deeds (Ex. P-69) is of the value of ₹ 7/-. It shows that stamp paper was sold to appellant on 23.5.1986. The case of the appellant is that the said stamp paper was purchased at Salem on 23.5.1986. But the stamp paper shows that it was sold by stamp vendor named P.K. Nagaraja Rao at Karur, which is a town far away from Salem where PW-11 and PW-15 carried on their business, and far away from Dindigul where appellant was residing. It is unimaginable that a person residing in Dindigul and proposing to borrow an amount from persons carrying on business at Salem would go to Karur to purchase a stamp paper of ₹ 7/-. On the other hand, it fully supports the evidence of PW-11 that the appellant's brothers wanted an ante-dated stamp paper on 30.5.1986 and PW-11 sent his clerk along with the appellant's brothers to the Bazar to procure such ante-dated stamp pap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt the said amount. We, therefore, find no error in the concurrent findings of the trial court and the High Court that the appellant had not borrowed the said amount from PW-11 and PW-15 and that the same was part of the ill-gotten money acquired as illegal gratification. 15. The appellant having failed to satisfactorily account for the assets beyond his known sources of income to the said extent of ₹ 2,50,000/-, is guilty of an offence under Section 5(1)(e) of the Act. In view of our said finding, it is really unnecessary to examine the other disputed amounts namely alleged loan from brothers and brothers-in-law (Rs.40,000/-), travelling allowance [Rs.22,922/60], bonus [Rs.8,000/-], difference in interest on fixed deposits [Rs.34,578/37]; and difference in cost of construction (Rs.28,740/-). We may, however, refer to two other questions on which arguments were advanced by the learned Counsel for the appellant. 16. The first relates to his argument that finding in his favour recorded by the Trial Judge cannot be altered to his detriment, in his appeal against conviction. He referred to four items (travelling allowance, bonus, difference in interest on Fixed Deposits and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order of acquittal which falls to be considered by the Appellate Court and not the order of conviction. Similarly, if an order of conviction is challenged by the convicted person but the order of acquittal is not challenged by the State, then it is only the order of conviction that falls to be considered by the Appellate Court and not the order of acquittal. Therefore the assumption that the whole case is before the High Court when it entertains an appeal against conviction is not well-founded and as such it cannot be pressed into service in construing the expression alter the finding . It was further held that the expression 'alter the finding' in Section 423(1)(b)(2) [corresponding to Section 386(b)(ii) of the new Code] has only one meaning, and that is alter the finding of conviction and not the finding of acquittal. This Court then proceeded to consider the question as to what are the kinds of cases in which the power to 'alter the finding' can be exercised, thus: The answer to this question is furnished by the provisions of Section 236, 237 and 238. Section 236 deals with cases where it is doubtful what offence has been committed, Section 237 with cases ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the offence should not be changed in an appeal against conviction. We are, therefore, of the view that the High Court did not exceed its jurisdiction in exercising the power of appeal under Section 386 Cr.P.C. 17. The second question is in regard to the claim of the appellant that travelling allowance should be treated as income. The appellant submitted that he had received, in all, a sum of ₹ 22,922.60 as travelling allowance during the check period and the said amount should be taken under the head of receipt/income during that period. This Court in C.S.D. Swami v. The State has held that prosecution would not be justified in concluding that travelling allowance was also a source of income (for the purpose of ascertaining the income from known sources during the check period) as such allowance is ordinarily meant to compensate the officer concerned for his out-of pocket expenses incidental to the journeys performed by him for his official tour/s. As traveling allowance is not a source of income to the Government servant but only a compensation to meet his expenses, the prosecution while calculating the sources of income during the check period, need not take it into acc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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