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TMI Blog2015 (11) TMI 1862X X X X Extracts X X X X X X X X Extracts X X X X ..... suspicion but not grave suspicion against the accused, he will be fully within his right to discharge the accused. If the evidence which the Prosecutor proposes to adduce to prove the guilt of the accused, even if fully accepted before it is challenged by cross-examination or rebutted by the defence evidence, if any, cannot show that the accused committed the offence, then there will be no sufficient ground for proceeding with the trial. The CBI failed to bring evidence on record to show that petitioner Bhojraj Teli had ever got any favour from accused Ramesh Nambiar, i.e., husband of petitioner Rekha Nambiar or that said accused was instrumental in awarding any contract to petitioner Bhojraj Teli from Railways during 1995-1996 or that any payment was made to M/s Archana Traders Pvt. Ltd. by petitioner Bhojraj Teli. However, the learned Trial Court while passing the order on charge recorded that in the absence of any record relating to consultancy, at this stage of charge, these entries have to be rejected and the entire such income is to be taken into account to see the extent of disproportion. The genuineness of the entries as submitted by the accused persons has to be establishe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ilways during September, 1995 to March, 1996 and the petitioner Bhojraj Teli used to receive orders for supply of machines from various Railway Zones from 1981 onwards. Hence, as per the case of the prosecution, there is no nexus between the said petitioner and accused No.1, and therefore, there was no occasion for the commission of any of the alleged offences. There is evidence on record to establish that money paid by the M/s HYT Group of Companies to petitioner Rekha Nambiar has been duly shown in the books of accounts and in the ITRs of the respective years. Moreover, petitioner Rekha Nambiar had also disclosed the income received from M/s HYT Group of Companies in her ITRs, however the learned Trial Court has ignored both the documents mentioned above and opined that these documents are matter of trial - It is true that the evidence in possession of the accused will be considered at the time of trial, however, the fact remains in the instant case is that documents taken into possession by the CBI establish that both the petitioners had declared the payments made and received in their ITRs and if any misconduct towards the employer has been committed by petitioner Rekha Nambiar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... up of Companies, Naveen Patil and Rekha Nambiar under Sections 13 (2) read with Section 13(1)(e) of Prevention of Corruption Act, 1988 ('PC Act') and Section 109 of the Indian Penal Code, 1860 ('IPC') on the allegations that accused Ramesh Nambiar while posted and functioning as AGM (Sport), Air India at New Delhi and other places, being a public servant, amassed assets worth about Rs.2,39,21,165/- during the period from 14.10.1991 to 30.06.1999 in his name, in the name of his wife, i.e., petitioner Rekha Nambiar and his family members, which were disproportionate to his known sources of income. 4. The matter was investigated by the Central Bureau of Investigation ('CBI'), whereby it was disclosed that accused Ramesh Nambiar joined Air India on 14.10.1991 as Sport Assistant at New Delhi. During the entire period of his office, he remained posted in Sport Division at Delhi in different capacities. During the period from September, 1995 to March, 1996, he remained posted as Assistant Private Secretary to the then Minister of State for Railways on deputation. Subsequently, during the period from March, 1998, he remained posted as Additional Private Secretary to the then Textile Minis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ck, petitioner Bhojraj Teli came in contact with accused Ramesh Nambiar and his wife petitioner Rekha Nambiar and developed friendly relations with them. Petitioner Bhojraj Teli had been visiting the office of accused Ramesh Nambiar, when he was posted as a Private Secretary to the then Minister of State for Railways during 1995-1996. Initially, he went to the office of the Minister of State for Railways along with Shantaram Potdhuke, the then MP from Maharashtra as a courtesy meeting as Sh. Suresh Kalmadi, the then Minister of State for Railways belongs to Maharashtra. Subsequently, petitioner Bhojraj Teli used to meet accused Ramesh Nambiar in his office of Railways whenever he visited the Railway Board in connection with his business of supply of machines of Indian Railways etc. Petitioner Bhojraj Teli used to receive orders for supply of machines through various Railway Zones from 1981 onwards. 9. It is further case of the CBI that name of M/s. Archana Traders Pvt. Ltd. and Naveen Patil figured in the FIR that accused Ramesh Nambiar obtained unlawful commission through petitioner Bhojraj Teli of M/s. HYT Group of Companies in the name of consultancy fee for his wife and routed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mbiar had taken any prior written permission from the Bank before rendering any consultancy to petitioner Bhojraj Teli from 2006 onwards. Accordingly, no benefit of consultancy fee can be allowed at this stage of charge. 12. Mr. Bansal submitted that the learned Trial Court in its impugned order dated 01.05.2014 further recorded that the explanation that money belongs to petitioner Rekha Nambiar cannot be accepted at this stage of charge, even though reflected in ITRs of Rekha Nambiar, who intentionally aided accused Ramesh Nambiar in acquiring disproportionate assets. Accordingly, the charge against Ramesh Nambiar was framed for the offences punishable under Sections 13(1)(e) read with Section 13(2) PC Act. As far as petitioner Bhojraj Teli is concerned, the learned Trial Court recorded that his role in this case is that he is connected with the payment of consultancy charges / fee to petitioner Rekha Nambiar which itself is to be established during the trial. 13. Mr. Bansal further submitted that Memorandum of Understanding ('MoU') dated 04.06.2006 (D-13) is an investors' agreement wherein petitioner Rekha Nambiar agreed to contribute 20% of the paid up capital of M/s. HYT Inno ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me as discussed above, and Shri Bhojraj Teli of M/s. HYT Group of Companies, M/s. Archana Traders Pvt. Ltd. and Shri Navin Patil have abetted Shri Ramesh Nambiar by various means in acquiring disproportionate assets. Therefore, the information prima facie discloses commission of offence punishable under Section 13 (2) r/w 13 (e) of PC Act, 1988 and Section 109 IPC." 16. Mr. Bansal further submitted that in order to bring home the guilt, either the prosecution was bound to establish that the amount of income shown in the name of the petitioner was bribe amount being paid to her husband or that it was the unaccounted money of her, which was being converted to the accounted one. The prosecution, however, did not allege either of the two, but had alleged that husband of the petitioner had obtained unlawful commission through petitioner Bhojraj Teli by routing the same through M/s. Archana Traders Pvt. Ltd. Ultimately, CBI could not establish the complicity of M/s. Archana Traders Pvt. Ltd. Consequently, the only allegations alleged having not been established, the prosecution was liable to be dropped. However, the CBI brought the half baked report before the Trial Court and the learne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itted that petitioner has been charged with offence punishable under Section 109 IPC read with Sections 13 (1) (e) and 13 (2) PC Act. The initial ingredient for Section 13 (1) (e) PC Act is that other person must be in possession of the property on behalf of public servant. However, there is no material in the charge sheet that the petitioner was in possession of any property on behalf of accused No.1 Ramesh Nambiar. As per the case of CBI, M/s HYT Innovative Projects Pvt. Ltd., had paid consultation fees to petitioner Rekha Nambiar and such payments had been made to said petitioner after due deductions of the TDS. The said payment was disclosed and reflected in the income tax returns of the above noted company. Thus, the petitioner cannot be charged for the offences punishable under Section 109 IPC. Ld. Sr. Counsel has placed reliance on M Krishna Reddy vs State Deputy Superintendent of Police, Hyderabad (1992) 4 SCC 45 wherein the Apex Court has held as under:- "14. We are unable to appreciate that reasoning and hold that the prosecution has not satisfactorily discharged the expected burden of proof in disproving the claim of the appellant. Therefore, on the fact of these unass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r permission of Deutsche Bank, cannot be read against petitioner Bhoj Raj Teli. 20. Learned senior counsel further submitted that taking service of a Professional is not a criminal act. Without any document or the witness, inference drawn by the learned Trial Court is illegal and liable to be set aside. Moreover, the second employment of petitioner Rekha Nambiar is not a criminal act and it can at the best make her liable for departmental action. 21. To strengthen the contentions, he relied upon the decision of the Apex Court in DSP, Chennai vs K Inbasagaran (2006) 1 SCC 420 wherein the Hon'ble Supreme Court held as under:- "17. Now, in this background, when the accused has come forward with the plea that all the money which has been recovered from his house and purchase of real estate or the recovery of the gold and other deposits in the Bank, all have been owned by his wife, then in that situation how can all these recoveries of unaccounted money could be laid in his hands. The question is when the accused has provided satisfactorily explanation that all the money belonged to his wife and she has owned it and the Income-tax Department has assessed in her hand, then in that ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re of the opinion that the view taken by the High Court appears to be justified and there are no compelling circumstances to reverse the order of acquittal. Hence, we do not find any merit in this appeal and the same is dismissed." 22. Learned senior counsel further submitted that allegations of the prosecution with regard to any real work being done by petitioner Rekha Nambiar are unsubstantiated. He submitted that the prosecution has relied upon two documents, which were the Shareholders' Agreement dated 13.12.2012 and the MoU dated 04.06.2006 annexed as Annexures 1 and 2 respectively. Clause 5 of the Shareholders' Agreement and Clauses 1,4,6,9 & 12 of the MoU mentioned above clearly establish that petitioner Rekha Nambiar had rendered her services as Consultant, Advisor and Director of M/s HYT Innovative Projects Pvt. Ltd. She had contributed 20% of the paid up capital in M/s HYT Innovative Projects Pvt. Ltd. She assisted them in marketing the company's products. None of the Directors of M/s HYT Group of Companies could be changed without permission of Rekha Nambiar which clearly establishes that she had active role in the affairs of the said company, for which she has been pai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is an offence committed by a person to whom the property is entrusted. 18. Ingredients of the offence under Section 406 are:- (1) a person should have been entrusted with property, or entrusted with dominion over property; (2) that person should dishonestly misappropriate or convert to his own use that property, or dishonestly use or dispose of that property or willfully suffer any other person to do so; (3) that such misappropriation, conversion, use or disposal should be in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract which the person has made, touching the discharge of such trust." 19. As, admittedly, drafts were drawn in the name of the company, even if appellant was its Managing Director, he cannot be said to have committed an offence under Section 406 of the Indian Penal Code. If and when a statute contemplates creation of such a legal fiction, it provides specifically therefor. In absence of any provision laid down under the statute, a Director of a company or an employee cannot be held to be vicariously liable for any offence committed by the company itself. {See Sabitha Ramamurthy a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... undoubted power to sift and weigh the evidence for the limited purpose of finding out whether or not a prima facie case against the accused has been made out; where the materials placed before the court disclose grave suspicion against the accused which has not been properly explained the court will be fully justified in framing a charge and proceeding with the trial; by and large if two views are equally possible and the Judge is satisfied that the evidence produced before him while giving rise to some suspicion but not grave suspicion against the accused, he will be fully justified to discharge the accused, and in exercising jurisdiction under Section 227 of the Code of Criminal Procedure, the Judge cannot act merely as a post office or a mouthpiece of the prosecution, but has to consider the broad probabilities of the case, the total effect of the evidence and the documents produced before the court but should not make a roving enquiry into the pros and cons of the matter and weigh the evidence as if he was conducting a trial [See Union of India versus Prafulla Kumar Samal]. xxxx xxxx xxxx 14. We have perused the records and we agree with the above views expressed by the High ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 39; by the trial court at that stage. Can he marshal the evidence found on the record of the case and in the documents placed before him as he would do on the conclusion of the evidence adduced by the prosecution after the charge is framed? It is obvious that since he is at the stage of deciding whether or not there exist sufficient grounds for framing the charge, his enquiry must necessarily be limited to deciding if the facts emerging from the record and documents constitute the offence with which the accused is charged. At that stage he may sift the evidence for that limited purpose but he is not required to marshal the evidence with a view to separating the grain from the chaff. All that he is called upon to consider is whether there is sufficient ground to frame the charge and for this limited purpose he must weigh the material on record as well as the documents relied on by the prosecution. In the State of Bihar v. Ramesh Singh 1977 CriLJ 1606 this Court observed that at the initial stage of the framing of a charge, if there is a strong suspicion-evidence which leads the Court to think that there is ground for presuming that the accused has committed an offence then it is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the prosecution, but has to consider the broad probabilities of the case, the total effect of the evidence and the documents produced before the Court, any basic infirmities appearing in the case and so on. This however does not mean that the Judge should make a roving enquiry into the pros and cons of the matter and weigh the evidence as if he was conducting a trial. xxxx From the above discussion it seems well settled that at the Sections 227-228 stage the court is required to evaluate the material and documents on record with a view to finding out if the facts emerging therefrom taken at their face value disclose the existence of all the ingredients constituting the alleged offence. The court may for this limited purpose sift the evidence as it cannot be expected even at the initial stage to accept all that the prosecution states as gospel truth even if it is opposed to common sense or the broad probabilities of the case." (Emphasis supplied) xxxx xxxx xxxx 31. In 2002 (1) JCC 172 (2):2002 SCC Crl. 310, Dilwar Balu Khurana Vs. State of Maharashtra, the Apex Court had clearly enunciated the principle that if two versions or two inferences can be reasonably drawn, the versi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... considered inter alia the facts that there is no evidence/document on record to establish her appointment as a Consultant with M/s. HYT Group of Companies. There is no evidence with regard to nature of work done by petitioner Rekha Nambiar. No project report was prepared and no permission was taken from her employer Deutsche Bank. 34. It is a settled law that in order to prove offence under Section 13(1) (e) PC Act, the prosecution has to satisfy the ingredients mentioned therein. Further there is no evidence / documents on record to substantiate petitioner Rekha Nambiar's claim of being engaged as Consultant of M/s. HYT Group of Companies and the money paid was towards the services rendered by her to the said company of petitioner Bhojraj Teli. 35. To strengthen her arguments, learned Counsel has relied upon a case of P. Nallammal etc. vs State rep. By Inspector of Police, AIR 1999 SC 2556, wherein the Apex Court observed as under: "20. The above contention perhaps could have been advanced before the enactment of the P.C. Act 1988 because Section 5(1)(e) of the old P.C. Act did not contain an "Explanation" as Section 13(1)(e) now contains. As per the Explanation the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order to become rich and the public servant acts accordingly. If it is a proved position there cannot be any doubt that A has abetted the offence by instigation. Next illustration is this: Four persons including the public servant decide to raise a bulk amount through bribery and the remaining persons prompt the public servant to keep such money in their names. If this is a proved position then all the said persons are guilty of abetment through conspiracy. The last illustration is this: If a public servant tells A, a close friend of him, that he has acquired considerable wealth through bribery but he cannot keep them as he has no known source of income to account, he requests A to keep the said wealth in A's name, and A obliges the public servant in doing so. If it is a proved position A is guilty of abetment falling under the "Thirdly" clause of Section 107 of the Penal Code. 23. Such illustrations are apt examples of how the offence under Section 13(1)(e) of the P.C. Act can be abetted by non-public servants. The only mode of prosecuting such offender is through the trial envisaged in the P.C. Act. 24. For the aforesaid reasons we are unable to appreci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... record and must be satisfied that the commission of offence by the accused is possible. 38. Mr.Narender Mann, learned Special Public Prosecutor appearing on behalf of the CBI in CRL.M.C. No. 4781/2014 submitted that at the stage of charge, the Court would not ordinarily consider as to whether the accused would be able to establish his defence. The satisfactory explanation as contemplated under Section 13 (1) (e) PC Act has to be before the learned Trial Court during trial, however, the petitioners would get opportunity to prove their cases by leading evidence and establishing the circumstances to the satisfaction of the learned Trial Court. 39. Learned Counsel relied upon State of Maharashtra vs Ishwar Piraji Kalpatri & Ors 1996 Crl L J 1127, wherein the Supreme Court held as under:- "24. At the stage of quashing of FIR or complaint, the High Court would not be justified en embarking upon an enquiry as to the probability, reliability or genuineness or the allegations made therein. The FIR having been lodged, the Government having accorded sanction and thereafter, the charge having been filed, there was absolutely no justification for the High Court to have stopped the normal p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... charge, the Court is not expected to hold mini trial and delve deep into the matter for the purposes of appreciating the evidence and the evidence can only be weighed when the entire material will be brought before the Trial Court. The Court was required to see at the time of framing charge whether a strong suspicion exists for commission of the offence. The Trial Court found prima facie case against the petitioner, accordingly framed charges." 43. I have heard the learned counsel for the parties. 44. The case against the petitioners was registered on 22.02.2010 on the basis of a source information, against accused No.1/Ramesh Nambiar, husband of petitioner Rekha Nambiar and Naveen Patil under Sections 13 (2) read with Section 13(1)(e) PC Act and Section 109 IPC on the allegations that accused Ramesh Nambiar while posted and functioning as AGM (Sport), Air India at New Delhi and other places, being a public servant, amassed assets worth about Rs.2,39,21,165/- during the period from 14.10.1991 to 30.06.1999 in his name and in the name of his family members, which were disproportionate to his known sources of income. For calculating the disproportionate assets of accused No.1 Rames ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c servant before the Court of Special Judge having jurisdiction over the matter for commission of the offences punishable under Section 109 IPC read with Sections 13 (1) (e) and 13 (2) PC Act, when the material on record per se sufficient for the Court to form an opinion that the accused person has committed the offence alleged against him. The Legislature has advisedly used the expression "satisfactorily account", the emphasis must be on the word "satisfactorily". That means the accused has to satisfy the court that his explanation is worthy of acceptance. 48. It is settled law that the property in the name of income tax assessee cannot be a ground to hold that it actually belongs to such assessee. However, the Court would interfere only if uncontroverted allegations on their face value show that no evidence is on record to make out the case and there is an abuse of the process of the Court. The test to determine a prima facie case would naturally depend upon the facts of each case and it is difficult to lay down a rule of universal application. By and large, however, if two views are equally possible and the judge is satisfied that the evidence adduced before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xpenses, which were duly intimated to the Income Tax Authority in ITRs. It shows that the learned Trial Court has ignored each and every aspect which is in favour of the petitioners and was on record. However, the learned Trial Court framed the charges only on the ground that petitioner Rekha Nambiar was not authorized to undertake any such consultancy work during the currency of her employment with Deutsche Bank without prior written approval of her employer. 50. In view of the facts recorded above, Section 109 IPC is not applicable against the petitioners for the reason that even the first ingredient of the term 'abetment', which has been defined under Section 107 IPC, is not complete. Thus, the learned Trial court has ignored the material placed by the CBI, which is part of the chargesheet and states as under: "The information has disclosed that various incriminating records were seized during search conducted in the above case from the residence and office premises of Shri Ramesh Nambiar. Information received shows that Shri Ramesh Nambiar has been involved in illegal activities of a middleman/tout and through which he has been earning substantial commission in connivance wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the two, but had alleged that husband of the petitioner had obtained unlawful commission through petitioner Bhojraj Teli by routing the same through M/s Archana Traders Pvt. Ltd. But the fact remains that CBI could not establish the complicity of M/s Archana Traders Pvt. Ltd, consequently, the chargesheet has not been filed against said company. In this manner, the CBI has filed the half baked report before the learned Trial Court and the learned Trial Court instead of rejecting the same, at the outset, has chosen to frame charges against the petitioners. 54. It is settled law that before framing the charge, the court must have some material on the basis of which it can come to the conclusion that there is a prima facie case against the accused. Before framing a charge, the court must apply its judicial mind on the material placed on record and must be satisfied that the commitment of offence by the accused was possible. The charge may although be directed to be framed when there exists a strong suspicion but it is also trite that the court must come to a prima facie finding that there exists some materials. Therefore, suspicion cannot alone, without anything more, it is trite, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered her services as Consultant, Advisor and Director of M/s HYT Innovative Projects Pvt. Ltd. She had contributed 20% of the paid up capital in M/s HYT Innovative Projects Pvt. Ltd. She assisted them in marketing the company's products. Moreover none of the Directors of M/s HYT Group of Companies were to be changed without permission of Rekha Nambiar which clearly establishes that she had active role in the affairs of the said company, for which she has been paid remuneration for her services. Even the aforesaid MoU clearly stated that petitioner Rekha Nambiar will receive an amount of Rs.1.50 Lac per month towards fixed marketing and business promotion expenses excluding sale commission. However, the finding of the learned Trial Court recorded in para No.5 of the impugned order that there is no document to show that petitioner Rekha Nambiar is a Consultant is contrary to the record. 57. The CBI itself recorded in the charge sheet that accused No.1 was posted as Private Secretary to the then Minister of State for Railways during September, 1995 to March, 1996 and the petitioner Bhojraj Teli used to receive orders for supply of machines from various Railway Zones from 1981 onwards ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income received from M/s HYT Group of Companies in her ITRs, however the learned Trial Court has ignored both the documents mentioned above and opined that these documents are matter of trial. 61. It is true that the evidence in possession of the accused will be considered at the time of trial, however, the fact remains in the instant case is that documents taken into possession by the CBI establish that both the petitioners had declared the payments made and received in their ITRs and if any misconduct towards the employer has been committed by petitioner Rekha Nambiar, she can be liable for the departmental action, however cannot be booked in this case. It is not the case of the CBI that petitioner Rekha Nambiar has acquired the assets more than her known sources. Her sources are very much known; each and every document was recovered by the CBI, however that has been ignored. Therefore, in the present case, everything cannot be left for trial. If there is no case made out against the petitioners, then why they should face the trial, which will definitely go for years together. The petitioners will also have to face the trauma of trial without having committed any offence by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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