Criminal Appeal No. 345 of 2002 · Kerala High Court · 2007

K.THANKAPPAN, J.--------------------------------------------------------CRL. APPEAL NOS.345 & 346 OF 2002--------------------------------------------------------Dated this the 8th day of October, 2007JUDGMENTBoth these appeals are filed against the judgment in C.C. No.2 of2002 on the file of the Enquiry Commissioner and Special Judge,Thiruvananthapuram. Crl. Appeal No.345 of 2002 is filed by the firstaccused and Crl.No.346 of 2002 is filed by the second accused in theCalendar Case. Both the appellants faced trial for the offences punishableunder Sections 7and 13(1)(d) read with Section 13(2) of the Prevention ofCorruption Act, 1988 (hereinafter referred to as "the P.C. Act") read withSection 120B I.P.C.2. The prosecution case against the appellants - accused was thatwhile the accused ,who were Special Grade Auditors, were engaged inauditing the accounts of Mannancherry South Milk Producer's Co-operatives Society (hereinafter referred to as "the Society") for the year1995-96, they detected misappropriation of an amount of Rs.40,000/- andin order to close the matter without reporting to the police, they demanded50% of the misappropriated amount as bribe from PW.2, the Secretary of CRL.A. NOS.345 & 346/20022the Society. It was the further case of the prosecution that though PW.2paid Rs.15,000/- to the first accused on 19.3.1997, he made a demand forthe balance amount of Rs.5,000/- and that the said amount of Rs.5000/-was received by the second accused from PW.2 at about 2.30 p.m. on21.3.1997. To prove the charge against the accused, the prosecutionexamined PWs.1 to 10 and produced Exts.P1 to P23 as well as MOs.1 to 6.On the side of the defence, DWs.1 to 4 were examined and Exts.D1 to D11were produced. On closure of the prosecution evidence, the accused werequestioned under Section 313 Cr.P.C. They denied the charges levelledagainst them. However, the trial court after considering the evidenceadduced by the prosecution, found both the accused guilty under Sections7 and 13(1)(d) read with Section 13(2) of the P.C. Act read with Section120B I.P.C., convicted them thereunder and sentenced them each toundergo rigorous imprisonment for four years each under Section 7 of theP.C. Act read with Section 120B I.P.C. and 13(1)(d) read with Section 13(2) of the P.C. Act read with Section 120B I.P.C. The first and secondaccused were also sentenced to pay a fine of Rs.40,000/- and Rs.25,000/-respectively for the offence under Section 7 of the P.C. Act read withSection 120B I.P.C. and in default of payment of fine, they were sentencedto undergo rigorous imprisonment for one year each. The substantivesentences were ordered to run concurrently. The above conviction and CRL.A. NOS.345 & 346/20023sentences are challenged in these appeals.3. Heard the learned counsel appearing for the appellants as well asthe learned Public Prosecutor.4. Learned counsel appearing for the appellant in Crl. AppealNo.345 of 2002 has raised the following contentions in challenging thejudgment of the trial court: (i) the finding of the trial court that theappellant - first accused demanded bribe from PW.2 is not based on anyevidence as neither the evidence adduced by PW.2 before the court norExt.P1 first information statement given by him would prove that such ademand was made by the first accused, (ii) the finding of the trial courtthat the appellant committed offences punishable under Sections 7 and 13(1)(d) read with Section 13(2) of the P.C. Act read with Section 120BI.P.C. on the basis of the recovery of the tainted currency notes from thesecond accused is not sustainable as there is no evidence to show theinvolvement of the appellant at the time when the second accused acceptedthe money and (iii) the finding of the trial court that the appellant and thesecond accused had conspired together to commit the offences underSections 7 and 13(1)(d) read with Section 13(2) of the P.C. Act is withoutany legally acceptable evidence. CRL.A. NOS.345 & 346/200245. Learned counsel appearing for the appellant in Crl. AppealNo.346 of 2002 has also raised the very same contentions with regard tothe finding entered by the trial court against the appellant under Sections 7and 13(1)(d) read with Section 13(2) of the P.C. Act read with Section120B I.P.C. Counsel further submitted that the prosecution had not provedby any records that the appellant - second accused was entrusted with thework of auditing the accounts of the Society. Counsel further submittedthat as the auditing of accounts of the said Society was not legallyentrusted with the second accused, he cannot be said to have committedthe offences punishable under Sections 7and 13(1)(d) read with Section 13(2) of the P.C. Act.6. The trial court relied on the evidence of PWs.1 and 2 to findthat both the accused were entrusted with the work of auditing theaccounts of the Society for the year 1995-96 as per the letter dated19.3.1997 of the Auditor General of Co-operative Milk MarketingDepartment. PW.1 was the President of the society concerned during therelevant time and this witness had given evidence before the court thatboth the accused came to the society on 19.3.1997 and started the auditingwork and while so, PW.2, the Secretary of the society informed him about CRL.A. NOS.345 & 346/20025the misappropriation of Rs.40,000/- alleged to have been detected by thesecond accused- appellant in Crl. Appeal No.346 of 2002. He also statedthat PW.2 informed him that as the amount misappropriated exceededRs.10,000/-, the matter has to be reported to the police and that thesecond accused was willing to close the matter if an amount of Rs.25,000/-was given to him. This witness also stated that PW.2 had informed himthat he had paid Rs.15,000/- to the second accused on 19.3.1997. He alsostated that an amount of Rs.5000/- more was paid to the second accusedon 21.3.1997 at the premises of Kalathiveedu Milk Society where theaccused were to audit the accounts on that day. The trial court alsoconsidered the evidence of PW.2, the Secretary of the Society. Thiswitness had given evidence to the effect that both the appellants wereentrusted with the work of auditing the accounts of the Society. He alsospoke about the demand made by the second accused for an amount ofRs.25,000/-. Subsequently he stated that the demand was for Rs.20,000/-.This witness also stated that aggrieved by the above demand, he reportedthe matter to PW.1, the President of the Society who advised him to waitfor a while. He further stated that in the meanwhile, the second accusedrepeated the demand and on 19.3.1997 at about 7.30 p.m., he paid anamount of Rs.15,000/- to the second accused and that the second accusedasked him to pay the balance amount of Rs.5000/- at the premises of CRL.A. NOS.345 & 346/20026Kalathiveedu Milk Society. Further, this witness stated that aggrieved bythe demand made by the second accused, after consulting PW.1, he went tothe office of PW.6, Deputy Superintendent of Police, V.A.C.B., Alappuzhaand gave Ext.P1 first information statement. He then stated that on theadvise of PW.6, he produced Mo.1 series of currency notes amounting toRs.5000/- and that PW.6 after noting down the number of the currencynotes and applying phenolphthalein powder on the currency notesentrusted the money to him for payment to the accused on demand. Thiswitness further stated that he went to the premises of Kalathiveedu MilkSociety at about 2.30 p.m. on 21.3.1997 and handed over the markedcurrency notes to the second accused.7. After considering the evidence adduced by PWs.1 and 2, the trialcourt found that demand for bribe was made by the second accused -appellant in Crl.Appeal No.346 of 2002 in the presence of the first accused- appellant in Crl. Appeal No.345 of 2002. There is no evidence to showthat the first accused had made any demand for bribe as alleged by theprosecution. From the circumstances now proved, it is necessary to findout whether the prosecution had succeeded in proving the case against thefirst accused - appellant in Crl. Appeal No.345 of 2002 that he haddemanded or received any amount from PW.2 as bribe. PWs.1 and 2 had CRL.A. NOS.345 & 346/20027stated before the court that it was the second accused who had demandedbribe. Even though in Ext.P1 first information statement given by PW.2 toPW.6, there was an allegation that the first accused had demanded andaccepted an amount of Rs.15,000/- from him, he deviated from hisstatement when he was cross-examined by the prosecutor, as can be seenfrom Ext.P1(a). But, the trial court considered the statement in Ext.P1(a)as corroborative evidence of PW.2. In this context, it has to be noted thatthe Apex Court in the judgments reported in Nanhku Singh v. State ofBihar, A.I.R. 1973 S.C. 491 and Hazari Lal v. State (Delhi Admn.),A.I.R. 1980 S.C. 873 considered the evidentiary value of both the firstinformation statement and the statements recorded by the investigatingofficer under Sections 161 and 162 Cr.P.C. and categorically held thatsuch statements are not substantive evidence and that they can be usedonly for contradicting the witness and not for corroboration. As theevidence of PW.2 did not prove that the first accused either demanded oraccepted bribe from him, the finding of the trial court against the firstaccused is not sustainable. It is also proved from the evidence of PW.3,the trap witness and PW.6, the Deputy Superintendent of Police, V.A.C.B.,Alappuzha, who prepared Ext.P5 recovery mahazar that an amount ofRs.5000/- was recovered from the second accused. PW.3 had also statedbefore the court that PW.2 had told him that the auditor would not receive CRL.A. NOS.345 & 346/20028money at his office and that saying so, PW.2 went to the office ofKalathiveedu Milk Society and that after sometime both PW.2 and thesecond accused came out of the office and after a brief talk with thesecond accused , PW.2 handed over the currency notes to the secondaccused who received the same in his right hand and put it in the pocket ofhis shirt. PW.3 also stated that on seeing the second accused receivingthe money, he had given signal to PW.6 and the other officials. 8. Admittedly, neither PW.2 nor PW.3 had a case that they had seenthe first accused at the premises of Kalathiveedu Milk Society. Theevidence of PW.6 and Ext.P5 recovery mahazar would show that MO.1series of marked currency notes were recovered from the second accused.In the light of the above evidence, this Court is of the view that theprosecution has not proved by adducing any evidence that the first accusedhad either demanded or received bribe . The trial court found the firstaccused guilty of the charges with the aid of Section 120B I.P.C. Toattract an offence under Section 120B I.P.C., the prosecution should proveby direct or circumstantial evidence that the first accused conspired withthe second accused to commit the offence. The evidence of PWs.1 and 2would show that even on 19.3.1997 when both the accused - appellantscame to the Society to do the auditing work, it was the second accused CRL.A. NOS.345 & 346/20029who had informed PW.2 regarding the detection of misappropriation of theamount. There is no case for either PW.1 or PW.2 that the first accusedhad made any attempt to extract any amount from PW.2. PW.2 also didnot say anything about any discussion between both the accused to draw aconclusion that both the accused had conspired together to demand bribefrom him. As per the evidence of PW.2, even the alleged payment ofRs.15,000/- on 19.3.1997 was to the second accused and not to the firstaccused. So, the prosecution had not adduced any direct or circumstantialevidence to show that the first accused had conspired with the secondaccuse to commit the offences alleged against them, as now found by thetrial court. The only circumstance to connect them together was that bothof them were doing the auditing work of the Society. In this context, thisCourt has to look into the evidence of PW.5, the Assistant Registrar/Concurrent Auditor who had stated that it was the first accused who wasentrusted with the work of auditing the accounts of the Society and that thesecond accused who was also a Special Grade Auditor had accompaniedthe first accused. But, on the basis of this evidence alone, this Court isnot in a position to draw the conclusion that both the accused - appellantshad conspired together to commit the offences as alleged by theprosecution. In this context, learned counsel appearing for the appellantin Crl. Appeal No.345 of 2002 invited the attention of this Court to the CRL.A. NOS.345 & 346/200210decisions of the Apex Court reported in Bhagwan Swarup v. State ofMaharashtra, A.I.R. 1965 S.C. 682 and E.K.Chandrasenan v. State ofKerala, A.I.R. 1965 S.C. 1066. In the former decision, the Apex Courtheld that unless and until all the ingredients of Section 10 of the IndianEvidence Act, 1872 is proved, an offence under Section 120B I.P.C.cannot be proved against any accused. The Apex Court further held inparagraph 8 of the judgment as follows:"(1)There shall be a prima facie evidenceaffording a reasonable ground for a Court tobelieve that two or more persons are members ofa conspiracy; (2) if the said condition is fulfilled,anything said, done or written by any one of themin reference to their common intention will beevidence against the other; (3) anything said,done or written by him should have been said,done or written by him after the intention wasformed by any one of them; (4) it would also berelevant for the said purpose against another whoentered the conspiracy whether it was said, doneor written before he entered the conspiracy orafter he left it; and (5) it can only be used againsta co-conspirator and not in his favour."In the latter decision, the Apex Court considered the ingredients ofconspiracy as contemplated under Section 120B I.P.C. and held that tofind an accused guilty under Section 120B I.P.C., the prosecution shouldprove that there was direct meeting of the minds of two or more accused. CRL.A. NOS.345 & 346/200211Further, in the decision reported in Ram Narayan Popli v. CBI (2003) 3S.C.C. 641, the Apex Court held as follows:"....... The elements of a criminalconspiracy have been stated to be: (a) an object tobe accomplished, (b) a plan or schemeembodying means to accomplish that object, (c)an agreement or understanding between two ormore of the accused persons whereby, theybecome definitely committed to cooperate for theaccomplishment of the object by the meansembodied in the agreement, or by any effectualmeans, and (d) in the jurisdiction where thestatute required an overt act. The essence of acriminal conspiracy is the unlawful combinationand ordinarily the offence is complete when thecombination is framed. From this, it necessarilyfollows that unless the statute so requires, noovert act need be done in furtherance of theconspiracy, and that the object of thecombination need not be accomplished, in orderto constitute an indictable offence. Law makingconspiracy a crime is designed to curbimmoderate power to do mischief which is gainedby a combination of the means. Theencouragement and support which co-conspirators give to one another renderingenterprises possible which, if left to individualeffort, would have been impossible, furnish theground for visiting conspirators and abettors withcondign punishment. The conspiracy is held tobe continued and renewed as to all its memberswherever and whenever any member of theconspiracy acts in furtherance of the commondesign. ............."The evidence adduced by the prosecution would not show whether there CRL.A. NOS.345 & 346/200212was meeting of the minds of the first and second accused and at what stagethey had decided to either demand or accept bribe from PW.2 as allegedby the prosecution. Therefore, the evidence adduced by the prosecution isnot sufficient to hold that the first accused had conspired with the secondaccused to commit the offences as alleged by the prosecution. Hence, thefinding of the trial court that the first accused also committed offencespunishable under Sections 7 and 13(1)(d) read with Section 13(2) of theP.C. Act with the aid of Section 120B I.P.C. is perverse and notsustainable. Accordingly, the finding of the trial court and the convictionentered and the sentences ordered against the first accused are hereby setaside. The first accused - appellant in Crl. Appeal No.345 of 2002 isfound not guilty and acquitted of all the charges levelled against him.9. The contention of the learned counsel appearing for theappellant in Crl. Appeal No.346 of 2002 that the evidence adduced by theprosecution would not prove that the appellant - second accused haddemanded any bribe as alleged by the prosecution has to be considered inthe light of the evidence of PWs.1 and 2. This Court had alreadydiscussed the evidence of PWs.1 and 2. Though PW.1 had stated in hischief examination that both the accused demanded an amount ofRs.25,000/- as bribe, subsequently this witness stated that he was told by CRL.A. NOS.345 & 346/200213PW.2 that the second accused alone had demanded an amount ofRs.20,000/- out of which an amount of Rs.15,000/- was paid to him on19.3.1997. PW.1 had further stated that PW.2 had told him that inspite ofpayment of Rs.15,000/- to the second accused, he made a further demandfor Rs.5000/- from PW.2 which he agreed to pay on 21.3.1997 at thepremises of Kalathiveedu Milk Society. This witness also stated that itwas he who had advised PW.2 to go to PW.6 and file a complaint. Theevidence of this witness was corroborated by PW.2, the Secretary of theSociety. Admittedly, Exts.P6 and P7 proforma reports would show thatboth the accused were entrusted with the work of auditing the accounts ofthe Society. The evidence of PW.2 also would show that both the accusedcame to the premises of the Society on 19.3.1997 for doing the auditingwork and that it was the second accused who had demanded 50% of thealleged misappropriated amount as bribe. The evidence given by PW.2 issimilar to Ext.P1 first information statement given by him. This witnesshad a definite case before the trial court that the first accused neverdemanded any amount. Further, the evidence of PW.3 also would provethat on 21.3.1997, he along with PWs.2, 6 and other officials went to thepremises of Kalathiveedu Milk Society where he had seen PW.2 handingover the marked currency notes to the second accused. He also spokeabout the recovery of the MO.1 series of tainted currency notes from the CRL.A. NOS.345 & 346/200214pocket of the second accused and also the phenolphthalein test conductedon the hands of the second accused and MO.1 series of currency notes. Itis also revealed from Ext.P5 recovery mahazar prepared by PW.6 that thecurrency notes recovered from the second accused on 21.3.1997 were thesame currency notes produced before him by PW.2 at the time of givingExt.P1 first information statement. It has been established from theevidence of these witnesses that the second accused - appellant in Crl.Appeal No.346 of 2002 had accepted an amount of Rs.5000/- from PW.2on 21.3.1997. Hence, the finding of the trial court regarding this aspectrequires no interference by this Court. Even though the prosecution had acase that an amount of Rs.15,000/- was already paid to the second accusedby PW.2 on 19.3.1997, that fact was not established by the prosecution byadducing any positive evidence. 10. The next question to be considered is whether the finding of thetrial court that the second accused - appellant in Crl.Appeal No.346 of2002 committed offences punishable under Sections 7 and 13(1)(d) readwith Section 13(2) of the P.C. Act read with Section 120B I.P.C. is legallysustainable or not? In this context, this Court had already discussed theevidence regarding conspiracy alleged to have been committed by both theaccused and found that there is no evidence to prove that both the accused CRL.A. NOS.345 & 346/200215had entered into a conspiracy to commit the offences. Hence, theevidence adduced by the prosecution would prove that the second accusedcommitted offences punishable under Sections 7 and 13(1)(d) read withSection 13(2) of the P.C. Act without the aid of any conspiracy.11. Learned counsel appearing for the appellant in Crl. AppealNo.346 of 2002 had taken a further contention that the prosecution had notproved that the second accused was also entrusted with the auditing workof the Society. This Court considered Exts.P6 and P7 proforma reportswhich would show that during March, 1997, the auditing work wasentrusted to both the accused. That apart, this Court had also found thatboth the accused came to the Society on 19.3.1997 and did the auditingwork. If that be so, the above contention of the learned counsel is nottenable. The trial court, considering the factum of recovery of the markedcurrency notes, relied on the presumption available under Section 20 of theP.C. Act to find that the second accused had committed the offences. Thatpresumption drawn against the second accused would also show that theexplanation offered by the second accused for the receipt of the amountfrom PW.2 on 21.3.1997 is not acceptable. If so, the trial court wasjustified in finding that the second accused - appellant in Crl. AppealNo.346 of 2002 committed offences punishable under Sections 7 and 13(1) CRL.A. NOS.345 & 346/200216(d) read with Section 13(2) of the P.C. Act. Hence, the conviction enteredand the sentences imposed by the trial court on the second accused -appellant in Crl. Appeal No.346 of 2002 require no interference by thisCourt.Accordingly, Crl. Appeal No.345 of 2002 is allowed. Crl. AppealNo. 346 of 2002 is dismissed, confirming the conviction and sentenceordered against the appellant under Sections 7 and 13(1)(d) read withSection 13(2) of the P.C. Act. (K.THANKAPPAN, JUDGE) sp/ CRL.A. NOS.345 & 346/200217K. THANKAPPAN, J.CRL.A. NOS.345 & 346/02JUDGMENT8TH OCTOBER, 2007