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Thursday, January 9, 2014

section 239 of Cr. P.C - Section 109 of the Indian Penal Code and Section 13(2) read with Section 13(1)(e) of the Prevention of Corruption Act - Tamil Nadu minister and his wife , mother in law , mother and father - Discharge petition was rejected by trial court - it is set aside by High court - Apex court set aside the orders of High court and rejected the Discharge petition filed under section 239 of Cr. P.C. = STATE REP. BY DEPUTY SUPDT. OF POLICE VIGILANCE AND ANTI CORRUPTION … APPELLANT VERSUS K.PONMUDI & ORS. …RESPONDENTS = 2014 ( JANUARY - VOL -1) JUDIS.NIC.IN/ S.C./ FILE NAME= 41135

 section 239 of Cr. P.C - Section  109  of  the Indian Penal Code and Section  13(2)  read  with  Section  13(1)(e)  of  the Prevention of Corruption Act - Tamil Nadu minister and his wife , mother in law , mother and father - Discharge petition was rejected by trial court - it is set aside by High court - Apex court set aside the orders of High court and rejected the Discharge petition filed under section 239 of Cr. P.C.  =
The investigating officer  also  came  to  the  conclusion
that Minister’s father and  mother  never  had  any  independent  source  of
income  commensurate  with  the  property  and  pecuniary  resources   found
acquired in their names.  
Accordingly, the investigating  officer  submitted
the charge-sheet dated 4th  of  July,  2003  against  Respondent  No.1,  the
Minister and his father  (Respondent  No.2)  and  mother  (Respondent  No.3)
respectively, alleging commission of an offence under  Section  109  of  the
Indian Penal Code and Section  13(2)  read  with  Section  13(1)(e)  of  the
Prevention of Corruption Act. 
Respondents filed application  dated  5th  of
December, 2003 under Section 239 of the Code  of  Criminal  Procedure,  1973
(hereinafter referred to as  ‘the  Code’),  seeking  their  discharge.    = 
True it  is  that  at  the
time of consideration of the applications for discharge,  the  court  cannot
act as a mouthpiece of the prosecution or act as a post-office and may  sift
evidence in order to find out  whether  or  not  the  allegations  made  are
groundless so as to pass an order of discharge.  It is  trite  that  at  the
stage of consideration of an application for discharge,  the  court  has  to
proceed with an assumption that the  materials  brought  on  record  by  the
prosecution are true and evaluate the said materials and  documents  with  a
view to find out whether the facts emerging therefrom taken  at  their  face
value disclose  the  existence  of  all  the  ingredients  constituting  the
alleged offence.  At this stage, probative value of the materials has to  be
gone into and the court is not expected to go deep into the matter and  hold
that the materials would not warrant a conviction.   In  our  opinion,  what
needs to be considered is whether there is a ground for presuming  that  the
offence has been committed and not  whether  a  ground  for  convicting  the
accused has been made out.  To put it differently, if the court thinks  that
the accused might have committed the offence on the basis of  the  materials
on record on its probative value,  it  can  frame  the  charge;  though  for
conviction, the court has to come to the conclusion  that  the  accused  has
committed the offence.  The law does not permit a mini trial at this  stage.

Here  the  allegation  against  the  accused
Minister (Respondent No.1), K. Ponmudi is that while he was a Member of  the
Tamil Nadu Legislative Assembly and a State Minister, he  had  acquired  and
was in possession of the properties in the name of  his  wife  as  also  his
mother-in-law, who along with his other friends, were  of  Siga  Educational
Trust, Villupuram.  According to the prosecution,  the  properties  of  Siga
Educational Trust, Villupuram were held by other accused on  behalf  of  the
accused Minister.  These properties, according to the prosecution, in  fact,
were the properties of K.Ponumudi.  Similarly, accused N. Suresh  Rajan  has
acquired properties disproportionate to his known sources of income  in  the
names of his father and mother.  While passing the order of  discharge,  the
fact that the accused other than the two Ministers  have  been  assessed  to
income tax and paid income tax  cannot  be  relied  upon  to  discharge  the
accused  persons  particularly  in  view  of  the  allegation  made  by  the
prosecution  that  there  was  no  separate  income  to  amass   such   huge
properties.  The property in the name  of  an  income  tax  assessee  itself
cannot be a ground to hold that it actually belongs to such an assessee.  In
case this  proposition  is  accepted,  in  our  opinion,  it  will  lead  to
disastrous consequences. It will give  opportunity  to  the  corrupt  public
servants to amass property in the name of known persons, pay income  tax  on
their behalf and then be out from the mischief of law.   While  passing  the
impugned orders, the court has not sifted the materials for the  purpose  of
finding out whether  or  not  there  is  sufficient  ground  for  proceeding
against the accused but whether that would warrant a conviction.  We are  of
the opinion that this  was  not  the  stage  where  the  court  should  have
appraised the evidence and discharged the accused as if it  was  passing  an
order of acquittal.  Further, defect in investigation  itself  cannot  be  a
ground for discharge. In our opinion, the order impugned suffers from  grave
error and calls for rectification.


        Any observation made by us in this judgment is for  the  purpose  of
disposal of these appeals and shall  have  no  bearing  on  the  trial.  The
surviving respondents are directed to appear before  the  respective  courts
on 3rd of February, 2014.  The Court shall proceed with the trial  from  the
stage of charge in accordance with law and make endeavour to dispose of  the
same expeditiously.


      In the result, we allow these appeals  and  set  aside  the  order  of
discharge with the aforesaid observation.


2014 ( JANUARY - VOL -1) JUDIS.NIC.IN/ S.C./ FILE NAME= 41135


                                                              REPORTABLE

                        IN THE SUPREME COURT OF INDIA

                       CRIMINAL APPELLATE JURISDICTION

                       CRIMINAL APPEAL NO.22-23  OF 2014
   (@SPECIAL LEAVE PETITION(CRL.)NOs.3810-3811 of 2012)

STATE OF TAMILNADU BY INS.OF POLICE
VIGILANCE AND ANTI CORRUPTION                … APPELLANT

                                   VERSUS


N.SURESH RAJAN & ORS.                      …RESPONDENTS


                                    With

                       CRIMINAL APPEAL NO.26-38 OF 2014
   (@SPECIAL LEAVE PETITION(CRL.)NOs. 134-146 of 2013)

STATE REP. BY DEPUTY SUPDT. OF POLICE
VIGILANCE AND ANTI CORRUPTION                … APPELLANT

                                   VERSUS

K.PONMUDI & ORS.                           …RESPONDENTS


                               J U D G M E N T


CHANDRAMAULI KR. PRASAD, J.

CRIMINAL APPEAL NO.22-23   OF 2014 (@SPECIAL LEAVE PETITION(CRL.)Nos.3810-
3811 of 2012)


      The State of Tamil Nadu aggrieved by the order dated 10th of December,
2010 passed by the Madras High Court in  Criminal  R.C.No.528  of  2009  and
Criminal M.P.(MD) No.1 of 2009,  setting  aside  the  order  dated  25th  of
September, 2009 passed by the learned Chief Judicial  Magistrate-cum-Special
Judge, Nagercoil (hereinafter referred to as ‘the Special  Judge’),  whereby
he refused to discharge the respondents, has preferred these  special  leave
petitions.


      Leave granted.


      Short facts giving rise to the present appeals are that
Respondent No.
1, N. Suresh Rajan, during the period from 13.05.1996 to 14.05.2001,  was  a
Member of the Tamil Nadu Legislative Assembly as also a  State  Minister  of
Tourism.   
Respondent  No.  2,  K.  Neelkanda  Pillai  is  his  father   and
Respondent No. 3, R.Rajam, his mother.  
On the basis of an information  that
N. Suresh Rajan, during his tenure as the Minister of Tourism, had  acquired
and was in possession of pecuniary resources and properties in his name  and
in the names of  his  father  and  mother,  disproportionate  to  his  known
sources of income, Crime  No.  7  of  2002  was  registered  at  Kanyakumari
Vigilance and Anti Corruption Department on 14th of March, 2002 against  the
Minister N. Suresh Rajan, his father, mother, elder sister and  his  bother-
in-law.
During the course of the investigation,  the  investigating  officer
collected  and  gathered  informations  with  regard  to  the  property  and
pecuniary resources in possession of N. Suresh Rajan during  his  tenure  as
the Minister, in his name and in the name of others.  On computation of  the
income of the Minister from his known sources and also expenditure  incurred
by him, it was found that the properties owned  and  possessed  by  him  are
disproportionate to  his  known  sources  of  income  to  the  tune  of  Rs.
23,77,950.94.
The investigating  officer  not  only  examined  the  accused
Minister but also his father and mother as also his sister and the  brother-
in-law.
 Ultimately, the investigating agency came to  the  conclusion  that
during the check period, Respondent No.1, N. Suresh Rajan has  acquired  and
was in possession of pecuniary resources and properties in his name  and  in
the names of his father, K. Neelakanda Pillai (Respondent No. 2) and  mother
R. Rajam (Respondent No. 3) and his wife D.S. Bharathi for  total  value  of
Rs. 17,58,412.47. 
The investigating officer  also  came  to  the  conclusion
that Minister’s father and  mother  never  had  any  independent  source  of
income  commensurate  with  the  property  and  pecuniary  resources   found
acquired in their names.  
Accordingly, the investigating  officer  submitted
the charge-sheet dated 4th  of  July,  2003  against  Respondent  No.1,  the
Minister and his father  (Respondent  No.2)  and  mother  (Respondent  No.3)
respectively, alleging commission of an offence under  Section  109  of  the
Indian Penal Code and Section  13(2)  read  with  Section  13(1)(e)  of  the
Prevention of Corruption Act.
Respondents filed application  dated  5th  of
December, 2003 under Section 239 of the Code  of  Criminal  Procedure,  1973
(hereinafter referred to as  ‘the  Code’),  seeking  their  discharge.  
The
Special Judge, by its order dated 25th of  September,  2009  rejected  their
prayer.  
While doing so, the Special Judge observed as follows:
             “At this stage it will be premature to say that there  are  no
             sufficient materials on the side of the  state  to  frame  any
             charge against them and the same would not be according to law
             in the opinion of this court and at the same time  this  court
             has come to know  that  there  are  basic  materials  for  the
             purpose of framing charges  against  the  3  petitioners,  the
             petition filed by the  petitioners  is  dismissed  and  orders
             passed to that effect.”


      Aggrieved by the same, respondents filed criminal revision before  the
High Court.
The High Court by the  impugned  judgment  had  set  aside  the
order of the Special Judge and discharged the  respondents  on  its  finding that in the  absence  of  any  material  to  show  that  money  passed  from respondent No. 1 to his mother and father,  latter  cannot  be  said  to  be holding the property and resources in their names on behalf  of  their  son.
The High Court while passing  the  impugned  order  heavily  relied  on  its
earlier judgment in the case of State by Deputy  Superintendent  of  Police,
Vigilance and Anti Corruption Cuddalore Detachment v.  K.  Ponumudi  &  Ors.
(2007-1MLJ-CRL.-100), the validity whereof is also  under  consideration  in
the connected appeals.  
The High Court while allowing the criminal  revision
observed as follows:


             “12.In the instant case, the properties standing in  the  name
             of the petitioners 2 and 3 namely, A2 and A3 could not be held
             to be the properties or resources belonging to the 1st accused
             in the absence of any investigation into the individual income
             resources of A2 and A3.  
Moreover, it is not disputed that  A2
             was a retired Head Master receiving pension and A3 is  running
             a Financial Institution and an Income Tax  assessee.   
In  the
             absence of any material to show that A1’s money flow into  the
             hands of A2 and A3, they cannot be  said  to  be  holding  the
             properties and resources in their name on behalf of the  first
             accused.  
There is also no material to show  that  A2  and  A3
             instigated   A1   to   acquire   properties   and    resources
             disproportionate to his known source of income.”


      It is in these circumstances that the appellant is before us.


CRIMINAL APPEAL NO.26-38   OF 2014
     (@SPECIAL LEAVE PETITION(CRL.)Nos. 134-146 of 2013)


      These special leave petitions are  barred  by  limitation.   There  is
delay of 1954 days in filing the petitions and  217  days  in  refiling  the
same.  Applications have been filed for condoning the delay  in  filing  and
refiling the special leave petitions.

      Mr. Ranjit Kumar, learned Senior Counsel for  the  petitioner  submits
that
the delay in filing the special leave petitions  has  occurred  as  the
Public Prosecutor earlier gave an opinion that it  is  not  a  fit  case  in
which special leave petitions deserve to be filed.  
The Government  accepted
the opinion and decided not to file the  special  leave  petitions.   It  is
pointed out that the very Government in which  one  of  the  accused  was  a
Minister had  taken  the  aforesaid  decision  not  to  file  special  leave
petitions.   
However, after  the  change  of  the  Government,  opinion  was
sought from the Advocate General, who opined that it is fit  case  in  which
the order impugned deserves to be challenged.  Accordingly, it is  submitted
that the cause shown is sufficient to condone the delay.

      Mr. Soli  J.  Sorabjee,  learned  Senior  Counsel  appearing  for  the
respondents, however, submits that mere change of Government  would  not  be
sufficient to condone the  inordinate  delay.   He  submits  that  with  the
change of the Government, many issues which have attained finality would  be
reopened after long delay, which should not be allowed.  According  to  him,
condonation of huge delay on  the  ground  that  the  successor  Government,
which belongs to a different political party,  had  taken  the  decision  to
file  the  special  leave  petitions  would  be  setting  a  very  dangerous
precedent and it would lead to miscarriage of justice.  He  emphasizes  that
there is a life span for every legal remedy and condonation of delay  is  an
exception.  Reliance has been placed on a decision  of  this  Court  in  the
case of Postmaster General v. Living Media India Ltd.,  (2012)  3  SCC  563,
and our attention has been drawn to Paragraph  29  of  the  judgment,  which
reads as follows:


             “29. In our view, it is the  right  time  to  inform  all  the
             government bodies, their agencies and  instrumentalities  that
             unless they have reasonable and acceptable explanation for the
             delay and there was bona fide effort,  there  is  no  need  to
             accept the usual explanation that the file  was  kept  pending
             for  several  months/years  due  to  considerable  degree   of
             procedural red tape in the process. The government departments
             are under a special obligation to  ensure  that  they  perform
             their duties with diligence  and  commitment.  Condonation  of
             delay is an exception and should not be used as an anticipated
             benefit for  the  government  departments.  The  law  shelters
             everyone under the same light and should not  be  swirled  for
             the benefit of a few.”


      Mr. Sorabjee further submits that the Limitation Act does not  provide
for different period of limitation for the Government in  resorting  to  the
remedy provided under the law and the case in  hand  being  not  a  case  of
fraud or collusion by its officers or agents, the huge delay is not  fit  to
be condoned.  Reliance has also been placed on a decision of this  Court  in
the case of Pundlik  Jalam  Patil  v.  Executive  Engineer,  Jalgaon  Medium
Project, (2008) 17 SCC 448 and reference has been made to  Paragraph  31  of
the judgment, which reads as follows:


             “31. It is true that when the State and its  instrumentalities
             are the applicants seeking condonation of delay  they  may  be
             entitled  to  certain  amount  of  latitude  but  the  law  of
             limitation  is  same  for   citizen   and   for   governmental
             authorities.  The  Limitation  Act  does  not  provide  for  a
             different period  to  the  Government  in  filing  appeals  or
             applications as such. It would be a different matter where the
             Government makes out a case where public interest was shown to
             have suffered owing to acts of fraud or collusion on the  part
             of its officers or agents and where the officers were  clearly
             at cross purposes with it. In a given case if any  such  facts
             are  pleaded  or  proved  they   cannot   be   excluded   from
             consideration and those  factors  may  go  into  the  judicial
             verdict. In the present case, no such facts  are  pleaded  and
             proved though a feeble attempt by the learned counsel for  the
             respondent was made to suggest collusion and fraud but without
             any basis. We cannot entertain the submission made across  the
             Bar  without  there  being  any  proper  foundation   in   the
             pleadings.”



      The contentions put forth  by  Mr.  Sorabjee  are  weighty,  deserving
thoughtful consideration and at one  point  of  time  we  were  inclined  to
reject the applications filed for  condonation  of  delay  and  dismiss  the
special leave petitions.
 However, on a second  thought  we  find  that  the
validity of the order impugned in these special leave petitions  has  to  be
gone into in  criminal  appeals  arising  out  of  Special  Leave  Petitions
(Criminal) Nos. 3810-3811 of 2012 and in the face of it, it shall be  unwise
to dismiss these special leave petitions on the ground  of  limitation.  
It
is worth mentioning here that the order impugned  in  the  criminal  appeals
arising out of Special Leave Petition (Criminal)  Nos.  3810-3811  of  2012,
State of Tamil Nadu by Ins. of Police, Vigilance and Anti Corruption  v.  N.
Suresh Rajan & Ors., has been mainly rendered, relying on  the  decision  in
State by Deputy Superintendent of  Police,  Vigilance  and  Anti  Corruption
Cuddalore Detachment vs. K. Ponmudi and Ors.(2007-1MLJ-CRL.-100),  which  is
impugned in the present special leave petitions.  
In fact,  by  order  dated
3rd of January, 2013, these petitions were directed to be heard  along  with
the aforesaid special leave petitions.  In such  circumstances,  we  condone
the delay in filing and refiling the special leave petitions.

      In these petitions the State of Tamil Nadu  impugns  the  order  dated
11th of August, 2006 passed by the Madras High Court  whereby  the  revision
petitions filed against the order of discharge  dated  21st  of  July,  2004
passed  by  the  Special   Judge/Chief   Judicial   Magistrate,   Villupuram
(hereinafter referred to as ‘the Special Judge’), in the Special Case No.  7
of 2003, have been dismissed.




      Leave granted.


      Shorn of unnecessary details, facts giving rise to the present appeals
are that K. Ponumudi, respondent No. 1 herein, happened to be  a  Member  of
the State Legislative Assembly and  a  State  Minister  in  the  Tamil  Nadu
Government during the check period. P. Visalakshi Ponmudi (Respondent  No.2)
is his wife, whereas P.Saraswathi (Respondent  No.3)  (since  deceased)  was
his  mother-in-law.   A.Manivannan  (Respondent   No.4)   and   A.Nandagopal
(Respondent  No.5)  (since  deceased)  are  the  friends  of  the   Minister
(Respondent No.1).  Respondent Nos.  3  to  5  during  their  lifetime  were
trustees of one Siga Educational Trust, Villupuram.


      In the present appeals, we have to examine the validity of  the  order
of discharge passed by the Special Judge as  affirmed  by  the  High  Court.
Hence, we consider it unnecessary to go into the details of the case of  the
prosecution or the defence of the respondent at this stage.  Suffice  it  to
say that, according to the prosecution, K. Ponmudi (Respondent No.1),  as  a
Minister of Transport and a Member of the Tamil  Nadu  Legislative  Assembly
during the period from 13.05.1996 to 30.09.2001, had  acquired  and  was  in
possession of pecuniary resources and properties in  his  name  and  in  the
names of his wife  and  sons,  which  were  disproportionate  to  his  known
sources of income.  Accordingly, Crime No.  4  of  2002  was  registered  at
Cuddalore Village, Anti-Corruption Department on 14th of March,  2002  under
Section 109 of the Indian Penal Code read with  Section  13(2)  and  Section
13(1)(e) of the Prevention of Corruption Act,  hereinafter  referred  to  as
‘the Act’.  During the course of investigation it  transpired  that  between
the period from 13.05.1996 to 31.03.2002,  the  Minister  had  acquired  and
possessed  properties  at  Mathirimangalam,   Kaspakaranai,   Kappiampuliyur
villages and other places in Villupuram Taluk, at Vittalapuram  village  and
other places in Thindivanam Taluk, at Cuddalore and  Pondicherry  Towns,  at
Chennai and  Trichy  cities  and  at  other  places.   It  is  alleged  that
respondent No.1-Minister being a public servant  committed  the  offence  of
criminal misconduct by  acquiring  and  being  in  possession  of  pecuniary
resources and properties in his name and in the names of his  wife,  mother-
in-law and also in the name of Siga Educational Trust,  held  by  the  other
respondents on  behalf  of  Respondent  No.  1,  the  Minister,  which  were
disproportionate  to  his  known  sources  of  income  to  the   extent   of
Rs.3,08,35,066.97.   According   to   the   prosecution,   he   could    not
satisfactorily account for the assets and in  this  way,  the  Minister  had
committed the offence punishable  under  Section  13(2)  read  with  Section
13(1)(e) of the Act.


      In the course of investigation, it further transpired that during  the
check period and in the places  stated  above,  other  accused  abetted  the
Minister in the commission of the offence by him.   Respondent  No.  2,  the
wife of the Minister, aided in commission of the offence by holding  on  his
behalf a substantial portion of properties and pecuniary  resources  in  her
name as well as in the name of M/s. Visal Expo, of which she  was  the  sole
Proprietor.  Similarly, Respondent  No.  3,  the  mother-in-law,  aided  the
Minister by holding on his behalf a substantial portion  of  properties  and
pecuniary resources in her name as well as in the name of  Siga  Educational
Trust by purporting to be one of its Trustees.  Similarly, Respondent No.  4
and  Respondent  No.  5  aided  the  Minister  and  held  on  his  behalf  a
substantial portion of the properties and pecuniary resources  in  the  name
of Siga Educational Trust by purporting to be its Trustees.  It is  relevant
here to mention that during the course of investigation,  the  statement  of
all other accused were  taken  and  in  the  opinion  of  the  investigating
agency, after due scrutiny of their  statements  and  further  verification,
the Minister was not able to  satisfactorily  account  for  the  quantum  of
disproportionate assets.  Accordingly, the  Vigilance  and  Anti  Corruption
Department of  the  State  Government  submitted  charge-sheet  against  the
respondents under Section 109 of the Indian Penal  Code  and  Section  13(2)
read with Section 13(1)(e) of the Act.


      It is relevant here to state that the offences  punishable  under  the
scheme of the Act have to be tried by  a  Special  Judge  and  he  may  take
cognizance of the offence without commitment of the accused  and  the  Judge
trying the accused is required to follow the  procedure  prescribed  by  the
Code for the trial of warrant cases by the Magistrate.   The  Special  Judge
holding the trial is deemed to be a  Court  of  Sessions.   The  respondents
filed petition for discharge under  Section  239  of  the  Code  inter  alia
contending that the system which the prosecution had followed  to  ascertain
the income of the accused is wrong.  Initially, the check  period  was  from
10.05.1996 to 13.09.2001 which, during the investigation, was enlarged  from
13.05.1996 to 31.03.2002.  Not only this,  according  to  the  accused,  the
income was undervalued  and  the  expenditures  exaggerated.   According  to
Respondent No. 1, the Minister, income of the  individual  property  of  his
wife and that of his mother-in-law and their expenditure ought not  to  have
been shown as his property.  According  to  him,  the  allegation  that  the
properties in their names are his benami properties is wrong.  It  was  also
contended that the valuation of the properties has been arrived  at  without
taking into consideration the entire income and  expenditure  of  Respondent
No. 1.  Respondents have also alleged that the  investigating  officer,  who
is the informant of the case, had acted autocratically  and  his  action  is
vitiated by bias.  The Special Judge examined all these contentions  and  by
order dated 21st of July, 2004 discharged Respondents on  its  finding  that
the investigation was not conducted properly.   The  Special  Judge  further
held that the value of the property of Respondent Nos. 2 to 5 ought  not  to
have been clubbed with that of  the  individual  properties  and  income  of
Respondent No. 1 and by doing so, the assets of Respondent No. 1  cannot  be
said to be  disproportionate  to  his  known  sources  of  income.   On  the
aforesaid finding the Special Judge discharged all the  accused.   Aggrieved
by the same, the State of Tamil Nadu filed separate revision  petitions  and
the High Court, by the  impugned  order,  has  dismissed  all  the  revision
petitions.  The High Court, while affirming the  order  of  discharge,  held
that the prosecution committed an  error  by  adding  the  income  of  other
respondents, who were assessed under the Income Tax Act, in  the  income  of
Respondent No.1.  In the opinion of  the  High  Court,  an  independent  and
unbiased scrutiny of the entire documents furnished  along  with  the  final
report would not make out any ground of framing of charges  against  any  of
the accused persons.  While  doing  so,  the  High  Court  has  observed  as
follows:


             “18. The assets which admittedly, do not belong to  Accused  1
             and owned by individuals having independent source  of  income
             which are assessed under the Income Tax Act, were added as the
             assets of  Accused  -1.   Such  a  procedure  adopted  by  the
             prosecution is not only unsustainable but  also  illegal.   An
             independent and unbiased  scrutiny  of  the  entire  documents
             furnished along with the final report would not make  out  any
             ground for framing of charge as against  any  of  the  accused
             persons.   The  methodology  adopted  by  the  prosecution  to
             establish the disproportionate assets with  reference  to  the
             known source of income is absolutely erroneous.


                       xxx         xxx        xxx
             The theory of Benami is totally alien to the concept of  trust
             and it is not legally sustainable to array the accused 3 to  5
             as holders of the properties or that they are the benamies  of
             the accused. The benami transaction has to be  proved  by  the
             prosecution by producing legally permissible  materials  of  a
             bona fide character which would directly  prove  the  fact  of
             benami and there is a total lack of materials on this  account
             and hence the theory of benami has not been  established  even
             remotely by any evidence. On  a  prima-facie  evidence  it  is
             evident that the other accused  are  possessed  of  sufficient
             funds for acquiring their properties and that A1  has  nothing
             to do with those properties and that he cannot be called  upon
             to explain the source of income of  the  acquisition  made  by
             other persons.
             19………  Admittedly  the  accused  are  not  possessed  of   the
             properties standing in the name of Trust and controlled by the
             Accused A3 to A5. The trust is  an  independent  legal  entity
             assessed to income tax and  owning  the  properties.  Only  to
             boost the  value  of  the  assets  the  prosecution  belatedly
             arrayed the Trustees of the Trust as accused 3 to 5  in  order
             to foist a false case as against A1.
                       xxx         xxx        xxx
             21………All the  properties  acquired  by  A2  and  A3  in  their
             individual capacity acquired out of their own income have been
             shown in the Income Tax Returns, which  fact  the  prosecution
             also  knows  and  also  available  in  the  records   of   the
             prosecution. The prosecution has no justification or reason to
             disregard those income tax returns  to  disallow  such  income
             while filing the final report. The documents now available  on
             record  also  would  clearly  disprove  the  claim  of  benami
             transaction.”


      The High court ultimately concluded as follows:
             “24…………Therefore, the trial court analyzing the materials  and
             documents that were made available at  the  stage  of  framing
             charges  and  on  their  face  value  arrived  at  the   right
             conclusion that  charges  could  not  be  framed  against  the
             respondents/accused.”


      Now we proceed to consider the legal position concerning the issue  of
discharge and validity of the  orders  impugned  in  these  appeals  in  the
background thereof.  Mr.  Ranjit  Kumar  submits  that  the  order  impugned
suffers from patent illegality.  He points out that at the time  of  framing
of the charge the scope is limited and what is to be seen at this  stage  is
as to whether on examination of the materials and the  documents  collected,
the charge can be said to be groundless or not.  He  submits  that  at  this
stage, the court cannot appraise the evidence as is  done  at  the  time  of
trial.  He points out that while passing the impugned orders,  the  evidence
has been appraised and the case of the prosecution has been rejected, as  is
done after the trial while acquitting the accused.


      Mr. Sorabjee as also Mr.  N.V.  Ganesh  appearing  on  behalf  of  the
respondents-accused, however, submit  that  when  the  court  considers  the
applications for discharge, it has to examine the materials for the  purpose
of finding out as to whether the  allegation  made  is  groundless  or  not.
They submit that  at  the  time  of  consideration  of  an  application  for
discharge, nothing prevents the court to sift and  weigh  the  evidence  for
the purpose of ascertaining as to whether the allegations made on the  basis
of the materials and the documents collected are groundless  or  not.   They
also contend that the court while considering  such  an  application  cannot
act merely as a post-office or a mouthpiece of the prosecution.  In  support
of the submission, reliance has been placed on a decision of this  Court  in
the case of Sajjan Kumar v. CBI, (2010) 9 SCC  368  and  our  attention  has
been drawn to Paragraph 17(4) of the judgment, which reads as follows:


             “17. In Union of India v. Prafulla Kumar Samal  &  Anr.,  1979
             (3) SCC 4, the scope of Section 227 CrPC was considered. After
             adverting to various decisions, this Court has enumerated  the
             following principles:


                            xxx   xxx   xxx


             (4) That in exercising his jurisdiction under Section  227  of
             the Code the Judge which under the present Code  is  a  senior
             and experienced court 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,  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.”




      Yet another decision on which reliance has been placed is the decision
of this Court in the case of Dilawar Balu Kurane v.  State  of  Maharashtra,
(2002) 2 SCC 135, reference  has been made to  the  following  paragraph  of
the said judgment:


             “12. Now the next question is whether a prima facie  case  has
             been made out against  the  appellant.  In  exercising  powers
             under Section 227 of  the  Code  of  Criminal  Procedure,  the
             settled position of law is that the  Judge  while  considering
             the question of framing the charges under the said section has
             the 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.”




      We have bestowed our consideration to the rival  submissions  and  the
submissions made by Mr. Ranjit Kumar commend us.  True it  is  that  at  the
time of consideration of the applications for discharge,  the  court  cannot
act as a mouthpiece of the prosecution or act as a post-office and may  sift
evidence in order to find out  whether  or  not  the  allegations  made  are
groundless so as to pass an order of discharge.  It is  trite  that  at  the
stage of consideration of an application for discharge,  the  court  has  to
proceed with an assumption that the  materials  brought  on  record  by  the
prosecution are true and evaluate the said materials and  documents  with  a
view to find out whether the facts emerging therefrom taken  at  their  face
value disclose  the  existence  of  all  the  ingredients  constituting  the
alleged offence.  
At this stage, probative value of the materials has to  be
gone into and the court is not expected to go deep into the matter and  hold
that the materials would not warrant a conviction.   
In  our  opinion,  what
needs to be considered is whether there is a ground for presuming  that  the
offence has been committed and not  whether  a  ground  for  convicting  the
accused has been made out.  
To put it differently, if the court thinks  that
the accused might have committed the offence on the basis of  the  materials
on record on its probative value,  it  can  frame  the  charge;  though  for
conviction, the court has to come to the conclusion  that  the  accused  has
committed the offence.  The law does not permit a mini trial at this  stage.
 Reference in this connection can be made  to  a  recent  decision  of  this
Court in the case of Sheoraj  Singh  Ahlawat  &  Ors.  vs.  State  of  Uttar
Pradesh & Anr., AIR 2013 SC 52, in which, after analyzing various  decisions
on the point, this Court endorsed the following view  taken  in  Onkar  Nath
Mishra v. State (NCT of Delhi), (2008) 2 SCC 561:
             “11. It is trite that at the stage of framing  of  charge  the
             court is required to evaluate the material  and  documents  on
             record with a view to finding out if the facts emerging  there
             from, taken at their face value, disclosed  the  existence  of
             all the ingredients constituting the alleged offence.  At that
             stage, the court is not expected to go deep into the probative
             value of the material on record. What needs to  be  considered
             is whether there is a ground for presuming  that  the  offence
             has been committed and not a ground for convicting the accused
             has been made  out.  At  that  stage,  even  strong  suspicion
             founded  on  material  which  leads  the  court  to   form   a
             presumptive  opinion  as  to  the  existence  of  the  factual
             ingredients constituting the offence alleged would justify the
             framing of charge  against  the  accused  in  respect  of  the
             commission of that offence."


      Now reverting to the decisions of this Court in the case Sajjan  Kumar
(supra) and Dilawar Balu Kurane (supra), relied on by  the  respondents,  we
are of the opinion that they do  not  advance  their  case.  
The  aforesaid
decisions consider the provision of Section 227 of  the  Code  and  make  it
clear that at the stage of  discharge  the  Court  can  not  make  a  roving
enquiry into the pros and cons of the matter and weigh the  evidence  as  if
it  was  conducting  a  trial.
 It  is  worth  mentioning  that  the   Code
contemplates discharge of  the  accused  by  the  Court  of  Sessions  under
Section 227 in a case triable by it; cases instituted upon a  police  report
are covered by Section 239 and cases instituted otherwise than on  a  police
report are dealt with in Section 245.
 From  a  reading  of  the  aforesaid
sections it is evident that they contain somewhat different provisions  with
regard to discharge of an accused.  Under  Section  227  of  the  Code,  the
trial court is required to discharge  the  accused  if  it  “considers  that
there  is  not  sufficient  ground  for  proceeding  against  the  accused”.
However, discharge under Section 239 can be  ordered  when  “the  Magistrate
considers the charge against the accused to be groundless”.  
The  power  to
discharge  is  exercisable  under  Section  245(1)  when,  “the   Magistrate
considers, for reasons to be recorded that no case against the  accused  has
been made out which, if  not  repudiated,  would  warrant  his  conviction”.
Section 227 and 239 provide for discharge before the recording  of  evidence
on the basis of the police report, the documents  sent  along  with  it  and
examination of the accused after giving an opportunity to the parties to  be
heard.
However, the stage of discharge under  Section  245,  on  the  other
hand, is reached only after the evidence referred in Section  244  has  been
taken.  Thus,  there  is  difference  in  the  language  employed  in  these
provisions.
But, in our opinion,  notwithstanding  these  differences,  and
whichever provision may be applicable, the court is required at  this  stage
to see that there is a prima facie case for proceeding against the  accused.
 Reference in this connection can be made to a judgment  of  this  Court  in
the case of R.S. Nayak v. A.R. Antulay, (1986) 2 SCC 716.   The  same  reads
as follows:


             “43………………Notwithstanding this difference in the position there
             is no scope for doubt that the stage at which  the  magistrate
             is required to consider the  question  of  framing  of  charge
             under Section 245(1) is a preliminary  one  and  the  test  of
             “prima facie”  case  has  to  be  applied.  In  spite  of  the
             difference in the language of the three  sections,  the  legal
             position is that if the Trial court is satisfied that a  prima
             facie case is made out, charge has to be framed.”




      Bearing in mind the principles aforesaid, we proceed to  consider  the
facts of  the  present  case.  
Here  the  allegation  against  the  accused
Minister (Respondent No.1), K. Ponmudi is that while he was a Member of  the
Tamil Nadu Legislative Assembly and a State Minister, he  had  acquired  and
was in possession of the properties in the name of  his  wife  as  also  his
mother-in-law, who along with his other friends, were  of  Siga  Educational
Trust, Villupuram.  
According to the prosecution,  the  properties  of  Siga
Educational Trust, Villupuram were held by other accused on  behalf  of  the
accused Minister.  
These properties, according to the prosecution, in  fact,
were the properties of K.Ponumudi.  
Similarly, accused N. Suresh  Rajan  has
acquired properties disproportionate to his known sources of income  in  the
names of his father and mother.  
While passing the order of  discharge,  the
fact that the accused other than the two Ministers  have  been  assessed  to
income tax and paid income tax  cannot  be  relied  upon  to  discharge  the
accused  persons  particularly  in  view  of  the  allegation  made  by  the
prosecution  that  there  was  no  separate  income  to  amass   such   huge
properties.  
The property in the name  of  an  income  tax  assessee  itself
cannot be a ground to hold that it actually belongs to such an assessee.  
In
case this  proposition  is  accepted,  in  our  opinion,  it  will  lead  to
disastrous consequences. 
It will give  opportunity  to  the  corrupt  public
servants to amass property in the name of known persons, pay income  tax  on
their behalf and then be out from the mischief of law.   
While  passing  the
impugned orders, the court has not sifted the materials for the  purpose  of
finding out whether  or  not  there  is  sufficient  ground  for  proceeding
against the accused but whether that would warrant a conviction.  
We are  of
the opinion that this  was  not  the  stage  where  the  court  should  have
appraised the evidence and discharged the accused as if it  was  passing  an
order of acquittal.  Further, defect in investigation  itself  cannot  be  a
ground for discharge. In our opinion, the order impugned suffers from  grave
error and calls for rectification.


        Any observation made by us in this judgment is for  the  purpose  of
disposal of these appeals and shall  have  no  bearing  on  the  trial.  The
surviving respondents are directed to appear before  the  respective  courts
on 3rd of February, 2014.  The Court shall proceed with the trial  from  the
stage of charge in accordance with law and make endeavour to dispose of  the
same expeditiously.


      In the result, we allow these appeals  and  set  aside  the  order  of
discharge with the aforesaid observation.


                                 ………………..……………………………….J.
                                                   (CHANDRAMAULI KR. PRASAD)



                                                  ………………….……………………………………… J.
                                                                (M.Y. EQBAL)
NEW DELHI,
JANUARY 06, 2014.








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