Investigation statements are not substantive evidence; receipt of illegal gratification may still be inferred from circumstances and sustain conviction.

Statements recorded by police during investigation could not be treated as substantive evidence and were usable only for contradiction under the Evidence Act; the Court excluded such material because the limited exceptions for dying declarations and discovery did not apply. On the remaining admissible evidence, receipt of treated currency notes was inferred from the surrounding circumstances, including the trap evidence and phenolphthalein reaction, so direct proof of handing over money was not essential. Once receipt was established, the statutory presumption of illegal gratification arose under the Prevention of Corruption Act and was not rebutted, so the conviction and sentence were upheld.

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Issues: (i) Whether statements recorded during investigation could be used as substantive evidence; (ii) Whether the proved circumstances justified the presumption of receipt of illegal gratification and sustained the conviction under the Prevention of Corruption Act.

Issue (i): Whether statements recorded during investigation could be used as substantive evidence.

Analysis: Section 162 of the Code of Criminal Procedure bars the use of statements made to a police officer during investigation, except for contradiction in the manner permitted by Section 145 of the Indian Evidence Act. Such statements may not be treated as substantive evidence, and the limited exceptions under Section 32(1) and Section 27 of the Indian Evidence Act were not attracted in the present case. The courts below were therefore wrong in relying upon the prior statements of witnesses as proof of demand or acceptance of bribe.

Conclusion: Such investigative statements could not be used as substantive evidence.

Issue (ii): Whether the proved circumstances justified the presumption of receipt of illegal gratification and sustained the conviction under the Prevention of Corruption Act.

Analysis: After excluding the inadmissible material, the remaining evidence of the trap officer and the panch witness established that the complainant produced treated currency notes, those notes were later thrown out by the accused, and the notes and connected articles reacted to the phenolphthalein test. The Court held that direct proof of passing of money was not indispensable and that receipt could be inferred from circumstantial evidence under Section 114 of the Indian Evidence Act. Once receipt of money was so inferred, the presumption under Section 4(1) of the Prevention of Corruption Act arose and was not rebutted by any explanation from the accused.

Conclusion: The presumption of illegal gratification was rightly drawn and the conviction was sustained.

Final Conclusion: The conviction and sentence were upheld because the admissible evidence established receipt of the treated currency notes and attracted the statutory presumption, while the inadmissible investigative statements could not be treated as substantive proof.

Ratio Decidendi: Statements made to police during investigation cannot be used as substantive evidence, but receipt of illegal gratification may be inferred from surrounding circumstances and the statutory presumption will operate once such receipt is established, unless rebutted.

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