KANCHAN KUMAR VERSUS THE STATE OF BIHAR (Supreme Court) (14.09.2022)

 REPORTABLE

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO.  1562 OF 2022

ARISING OUT OF SLP (CRL) NO. 9601 OF 2016

KANCHAN KUMAR                                                                         ...APPELLANT

VERSUS

THE STATE OF BIHAR                                                                ...RESPONDENT

J U D G M E N T

PAMIDIGHANTAM SRI NARASIMHA J. 

1.       Leave granted.

2.        This   appeal   is   against   the   concurrent   dismissals   by   the Trial and the High Court of the application for discharge filed by the   Appellant   under   Section   227   of   the   Code   of   Criminal Procedure, 1973

3.  Facts leading  to the filing of this Appeal:  The Appellant joined the Bihar State Financial Corporation4  in the capacity of an Assistant General Manager on 19.07.1974. After a period of thirteen years, in 1987, a complaint came to be filed against the Appellant for having allegedly purchased three houses and two pieces of land in Bihar, which according to the complainant, was disproportionate   to   Appellant’s   known   sources   of   income.   This complaint was inquired into,  and  after  a  detailed  investigation, the   allegations   were   found   to   be   false.   Except   for   a   residential house     in     Patna,     which     the     Appellant     had     purchased     on 29.08.1988   for   Rs.   2,26,500   with   the   help   of   a   loan   from   the BSFC, no other assets could be traced to the ownership of the Appellant. However, despite finding no merit in the allegation, the investigation was kept pending. 

4.        In the meanwhile, life moved on and in 1996, the Appellant joined the Oil and Natural Gas Commission5  as Deputy General Manager on deputation, keeping his lien with the BSFC.   Four years after joining ONGC, an FIR came to be registered against him   on   21.02.2000,   under   Sections   13(l)(d)   and   13(2)   of   the  Prevention of Corruption Act, 19886, on the same allegation that he   possessed   assets   disproportionate   to   his   known   sources   of income.   These   alleged   assets   were  purportedly   acquired   during his tenure with the BSFC, and consequently, the check period in the   FIR   was   considered   from   the   date   he   joined   BSFC,   i.e., 19.07.1974   to   the   date   of   registration   of   the   residential   house purchased by him, i.e., 29.08.1988. The Appellant wrote a letter to     the     Director     General     of     Police     (Vigilance),     Patna,     on 18.04.2002, raising a grievance that the  calculations in the FIR undervalued     his     income     and     overvalued     his     assets,     thus depicting a false and inflated account of his expenditure.

5.        Eventually a charge sheet came to be filed on 11.09.2007, i.e., about seven years after the registration of the FIR, and in fact, twenty years after the complaint on this very allegation was found   to   be   false   by   the   authorities.   Be   that   as   it   may,   the charge­sheet filed against the Appellant indicated that he earned a total income of Rs. 3,01,561 and incurred an expenditure of Rs. 5,24,386   during   the   check   period.   In   view   of   this,   the   charge against   the   Appellant   was   of   having   amassed   Rs.   2,22,825, disproportionate   to   his   known   sources   of   income.  The   charge­ sheet indicated two components of his income, being ­ i) savings of Rs. 1,13,081 (1/3rd  of his salary), and ii) home and car loan from BSFC worth Rs. 1,88,480. On the other hand, the charge sheet   included   six   components   of   his   expenditure,   being   –   i) payment of Rs. 2,26,500 towards the construction of his house, ii) general expenditure during the check period of Rs. 24,800, iii) amount in bank deposit worth Rs. 55,000, iv) loan repayment of Rs.   53,467,   v)   LIC   deposit   worth   Rs.   6,057,   and   vi)   estimated value of articles found during a search conducted on 21.02.2000, as being Rs. 1,58,562.

6.        At   the   relevant   stage,   the   Appellant   applied   for   discharge under “Section 239” of the Cr.P.C (which should have been under Section 2277) before the Court of Special Judge (Vigilance), Patna, alleging   that   there   were   glaring   errors   in   the   calculation. However, the Court summarily dismissed the application by  its order   dated   28.03.2016,   without   analysing   or   examining   the documents   produced   and   the   arguments   advanced.   The   Court held that:

7 Though the Appellant stated that the application is under Section 239 of the Cr.P.C., as Special   Judges   appointed   under   the   PC   Act   are   deemed   to   be   Court   of   Session,   the discharge  application  should  have  been  filed  under  Section  227  of  the  Cr.P.C.,  and  not under   Section   239   therein.   The   Ld   counsel   for   the   Appellant   Shri   Sunil   Kumar, Senior Advocate clarified this position of law while making his submissions.

“Perused the record and I find that there is sufficient materials against accused in this case at   least   prima   facie   at   this   stage   to   frame charge against the accused against whom there is   allegation   that   he   during   the   check   period amassed.   Although   certain   explanations   have been advanced by the learned counsel for the petitioner   but   the   same   appears   to   be   looked into and appreciated during the course of trial when the accused petitioner wife have a chance to   prevents   innocence   producing   his   oral   or documentary   evidences.   For   the   present   I   am not satisfied with the explanation so produced by the accused in his favour in support of his discharge application. Considering       the       aforesaid       facts       and circumstances     the     charge     petition     of     the accused   petitioner   namely   Kanchan   Kumar   is hereby   rejected.   Put   up   on   22.04.2016   for framing   of   charge.   The   accused   is   directed   to remaining   physically   present   on   the   date   so fixed by this court for framing of charge.”

7.        Aggrieved by the dismissal of his application for discharge, the   Appellant   moved   the   High   Court.   After   recounting   the chronology    of    events,   the   High    Court   proceeded    to   quote judgment   after   judgment,   and   finally   dismissed   the   revision application by merely holding that: 

“15.   In   the   aforesaid   circumstances,   even   if considering the submissions made on behalf of petitioner,   for   argument’s   sake   needs   proper verification     attracting     roving     enquiry     which could be permissible only during course of trial.

16. Much emphasis has been laid at the end of the petitioner relating to valuation. With the cost of repetition, the contention of the petitioner is that as the raid was conducted on 21.02.2000, on  account   thereof,   the   valuation   having   been shown against the article so seized at the end of   the   Vigilance   must   be   considered   to   be   in consonance   with   the   date   of   recovery.   That argument   happens   to   be   fallacious   in   the background of the fact that from the case diary, it is evident that valuation has been estimated only. There happens to be complete absence of prima facie material whereupon one could infer that the value so affixed at that very moment was   prevailing   rate   on   the   alleged   date   of seizure. Furthermore, to ascertain genuineness on this  score  will again  attract  roving  enquiry which for the present stage is found forbidden. 

17.  Consequent thereupon, the instant petition is   found   devoid   of   merit   and   is,   accordingly, rejected.”

8.        It   is   against   the   aforesaid   order   that   the   Appellant   has approached this Court.  

9.        Submissions of parties:  The Ld. Senior Counsel Shri Sunil Kumar   has   submitted   that   the   basic   objection   relating   to   the calculation and wrongful inclusion of certain items was sufficient for the Trial Court to discharge the Appellant. In a simple and straight forward submission, he  took us through certain glaring errors that were evident from the record of the case before the Special Judge (Vigilance). In support of his submissions, he also referred to the decisions of this Court in Union of India v. Prafulla Kumar Samal and Anr. (1979) 3 SCC 4 and Ghulam Hassan Beigh v. Mohammad Maqbool Magrey 2022 SCC OnLine SC 913.

10.     The counsel for the Respondent Shri Abhinav Mukerji AOR, has contended that the Trial Court was right in dismissing the discharge   application.   He   submitted   that   the   Courts   could   not have     conducted     a     roving     inquiry     while     adjudicating     an application under Section 239 of the Cr.P.C.

11.     Issue:    The   short   question   arising   for   consideration   is whether   the   Appellant   is   entitled   to   be   discharged   of   the proceedings initiated against him under the PC Act. 

12.     Legal provision and precedents: Section 227 of the Cr.P.C relating to discharge is as under: 

“227.   Discharge   —  If,   upon   consideration   of the   record   of   the   case   and   the   documents submitted   therewith,   and   after   hearing   the submissions of the accused and the prosecution in this behalf, the Judge considers that there is not sufficient ground for proceeding against the accused,   he   shall   discharge   the   accused   and record his reasons for so doing.”

13.     The     threshold     of     scrutiny     required     to     adjudicate     an application under Section 227 of the Cr.P.C., is to consider the broad probabilities of the case and the total effect of the material on record, including examination of any infirmities appearing in the case.  In Prafulla Kumar Samal (supra), it was noted that:

“10. Thus, on a consideration of the authorities mentioned     above,     the     following     principles emerge: 

(1)   That   the   Judge   while   considering   the question     of     framing     the     charges     under Section 227 of the Code 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.

(2)   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.

(3) 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 produced   before   him   while   giving   rise   to some     suspicion     but     not     grave     suspicion against the accused, he will be fully within his right to discharge the accused.

(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.”      

                                        (emphasis supplied)

14.    In  Sajjan   Kumar   v.   Central   Bureau   of   Investigation (2010) 9 SCC 368,   the Court cautioned against accepting every document produced by the prosecution on face value, and noted that it was important to sift the evidence produced before the Court. It observed that:

“21.  On consideration of the authorities about the scope of Sections 227 and 228 of the Code, the following principles emerge:

...

(v)   At   the   time   of   framing   of   the   charges,   the probative value of the material on record cannot be   gone   into   but   before   framing   a   charge   the court   must   apply   its   judicial   mind   on   the material placed on record and must be satisfied that the commission of offence by the accused was possible.

(vi) At the stage of Sections 227 and 228, the court   is   required   to   evaluate   the   material  and documents on record with a view to find out if the facts emerging therefrom taken at their face value     disclose     the     existence     of     all     the ingredients constituting the alleged offence. For this   limited   purpose,   sift   the   evidence   as   it cannot be expected even at that 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)

15.    Summarising the principles on discharge under Section 227 of   the   Cr.P.C,   in   Dipakbhai   Jagdishchandra   Patel   v.   State   of Gujarat, (2019) 16 SCC 547 this Court recapitulated:

“23.   At   the   stage   of   framing   the   charge   in accordance with the principles which have been laid   down   by   this   Court,   what   the   court   is expected to do is, it does not act as a mere post office. The  court  must  indeed  sift  the  material before it. The material to be sifted would be the material which is produced and relied upon by the     prosecution.     The     sifting     is     not     to     be meticulous in the sense that the court dons the mantle   of   the   trial   Judge   hearing   arguments after   the   entire   evidence   has   been   adduced after a full ­fledged trial and the question is not whether the prosecution has made out the case for   the   conviction   of   the   accused.   All   that   is required is, the court must be satisfied that with the materials available, a case is made out for the   accused   to   stand   trial.  A   strong   suspicion suffices. However, a strong suspicion must be founded   on   some   material.   The   material   must be such as can be translated into evidence at the stage of trial. The strong suspicion cannot be the pure subjective satisfaction based on the moral notions of the Judge that here is a case where   it   is   possible   that   the   accused   has committed the offence. Strong suspicion must be the   suspicion   which   is   premised   on   some material which commends itself to the court as sufficient to entertain the prima facie view that the     accused     has     committed     the     offence.”

(emphasis supplied)

16.1              Analysis:  Without   getting   into   too   many   details,   we consider it to be appropriate and in fact sufficient to confine our inquiry   to   three   heads   of   expenditure   indicated   in   the   charge sheet itself. This limited inquiry will also satisfy the requirements of Section 227 of the Cr.P.C. 

16.2              The first objection pertains to the inclusion an amount of Rs. 55,000, recorded as the balance amount in the Appellant’s bank account during the check period, and accordingly counted as   an   expenditure   in   the   charge   sheet.   However,   the   Bank Passbook   filed   by   the   Appellant,   which   was   available   to   the Investigation Officer and the Special Judge (Vigilance), evidently records a balance amount of only Rs. 11,998 during the check­ period.   The   difference   in   the   figures   was   not   explained   by   the Prosecution.   Accordingly,  the   Special  Judge   (Vigilance)   and   the High Court failed to reconcile such a simple and straightforward inconsistency in the Prosecution’s evidence. We are of the opinion that only an amount of Rs. 11,998, recorded in the Appellant’s Bank Passbook during the check­period as the balance amount, is validly admissible as expenditure under this head.

16.3              The   second   objection   relates   to   the   inclusion   of   an amount of Rs. 53,467 as expenditure towards repayment of the loan from the BSFC. However, the amount repaid towards loan instalments was already deducted from Appellant’s gross salary, and   the   deducted   figure   was   recorded   as   the   total   disposable income with the Appellant during the check period. Hence, the loan repayment cannot be separately counted as an expenditure yet again. This is a glaring mistake. The Special Judge (Vigilance) as well as the High Court did not consider this objection on the ground   that   a   roving   inquiry   is   not   permissible   the   stage   of discharge. 

16.4              The   third   objection   relates   to   the   inclusion   of   Rs. 1,58,562   as   the   value   of   the   articles   found   during   a   search conducted in Appellant’s house on 21.02.2000, twelve years after the check period of 1974 to 1988. There is nothing to indicate, even  prima facie, that these articles found during the search in the   year   2000   were   acquired   during   the   check   period.   In   the absence   of   any   material   to   link   these   articles   as   having   been acquired during the check period, it is impermissible to include their   value in the expenditure.   We are therefore  of  the  opinion that the Appellant’s objection about inclusion of this amount in the list of expenditure is fully justified. Unfortunately, even this objection, which did not require much scrutiny of the material on record, was not considered by the Special Judge (Vigilance) or the High Court.

17.    The three heads of expenditure discussed hereinabove must be excluded from Appellant’s total alleged expenditure during the check   period.   First,   the   Appellant’s   actual   balance   amount reflected in the Bank Passbook, i.e., Rs. 11,998, as against the purported   account   balance   of   Rs.   55,000,   must   be   taken   into account.   Further,   the   second   and   third   amounts,   as   indicated above,   must   be   excluded   from   Appellant’s   total   expenditure mentioned in the charge­sheet. Accordingly, the total expenditure comes only to Rs. 2,69,355, and not Rs. 5,24,386, which is based on certain mistakes that we have indicated hereinabove. It is this expenditure of Rs. 2,69,355 which is to be contrasted with the income   of   Rs.   3,01,561   during   the   check­ period.   These   facts clearly demonstrate that there is no prima facie case made out by the   prosecution   and   therefore   the   Appellant   was   entitled   to   be discharged. 

18.     The conclusions that we have drawn are based on materials placed before us, which are part of the  case record. This is the same record that was available with the Special Judge (Vigilance) when the application under Section 227 of the Cr.P.C. was taken up.   Despite   that,   the   Special   Judge   (Vigilance)   dismissed   the discharge application on the simple ground that a roving inquiry is   not   permitted   at   the   stage   of   discharge.   What   we   have undertaken is not a roving inquiry, but a simple and necessary inquiry for a proper adjudication of an application for discharge. The   Special   Judge   (Vigilance)   was   bound   to   conduct   a   similar inquiry for coming to a conclusion that a prima facie case is made out for the Appellant to stand trial. Unfortunately, the High Court committed   the   same   mistake   as   that   of   the   Special   Judge (Vigilance).

19.     Apart   from   the   above   analysis,   we   would   note   with   great distress       that       the       allegation       relating       to       Appellant’s disproportionate   income   in  the   period   between  1974  and   1988 was   levelled   in   an   FIR   filed   twelve   years   after   the   said   period concluded. The charge­sheet came to be filed seven years after the registration of the FIR. The application for discharge came to be dismissed on 28.03.2016, almost after a decade of filing of the charge   sheet.   The   dismissal   was   affirmed   by   the   High   Court seven months thereafter, i.e., on 05.10.2016. Finally, and most unfortunately,   the   present   SLP   has   been   pending   before   this Court   for   the   last   six   years.   In   the   meanwhile,   the   Appellant superannuated from service in 2010, but had no option except to contest   the   case.   He   is   now   72   years.   Continuation   of   the prosecution,   apart   from   the   illegality   as   indicated   hereinabove, would also be unjust. 

20.     For the reasons stated above, we allow the Criminal Appeal arising   out   of   SLP   (Crl)   No.   9601   of   2016,   and   set   aside   the judgment   and   order   of   the   High   Court   of   Patna   in   CRLM   No. 23031 of 2016 dated 05.10.2016, and that of the Court of Special Judge (Vigilance), Patna in  Special Case No. 09 of 2000, dated 28.03.2016, and discharge the Appellant.  

21.     No order as to costs.

……………………………….J.

                                                            [B.R. GAVAI]

……………………………….J.

[PAMIDIGHANTAM SRI NARASIMHA]

NEW DELHI;

SEPTEMBER 14, 2022