TaxTMI 
TaxTMI 
2014 (8) TMI 1044
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.... the purpose of considering the rival legal contentions urged by the learned counsel for the parties and with a view to find out whether this Court is required to interfere with the impugned judgment and order of conviction and sentence of the High Court, the necessary facts are briefly stated hereunder: The complainant, Ramesh Suri (PW-2), was running a business of import and export of buttons, zips, etc. in the name and style of M/s Erica Enterprises. It is alleged that the appellant along with his colleague P.S.Saini (both Inspector Customs (Preventive)) visited the office cum godown of the complainant (PW2) on 4.07.1989 and that P.S.Saini demanded a bribe of Rs. 2 lakhs from the complainant, one lakh each for himself and the accused as the articles kept in the godown were notified goods and since his firm was not a notified dealer, the complainant has violated the provisions of Customs Act, 1962. 3. Further, on 07.07.1989, it is alleged by the prosecution that the appellant telephonically contacted the complainant (PW-2) and reiterated the demand as made by P.S.Saini. During the time of telephonic conversation, the brother-in-law of the complainant Ram Malhotra was sitting wi....
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....that the further lacuna in the prosecution case is that Ram Malhotra, the Brother-in-law of the complainant, who was stated to be present at the time of the telephonic demand made by the accused with the complainant was examined by the prosecution. The prosecution could neither prove the demand and acceptance of the gratification by the appellant nor were they able to prove conscious possession of the black rexine bag containing the GC notes with him. Therefore, the alleged recovery of money cannot be stated to be "acceptance" of illegal gratification by the appellant as alleged by the prosecution. 8. It has been further submitted by the learned senior counsel for the appellant that the appellate court in exercise of its appellate jurisdiction has erroneously re-appreciated the evidence produced by the prosecution and has set aside the valid finding of fact recorded by the learned trial judge on the charges framed against the appellant. Therefore, the finding recorded on this aspect of the matter in the impugned judgment by the appellate court is not only erroneous on facts but in law, therefore, the same is liable to be set aside. Further, it is contended by him that the learned ....
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....he judgment and order of acquittal of the accused. The relevant paragraphs from the above judgments are extracted in the answering portion of the contentious points. 10. The learned senior counsel further submits that 'presumption' of offence committed by the appellant under Section 20 of the Act can be invoked against him by the prosecution, only if the prosecution successfully proves the foundational facts. In the case in hand, since the demand, acceptance of bribe money and recovery of the same from him has not been proved by the prosecution, the statutory presumption under Section 20 of the Act against the guilt of the accused does not arise and therefore rebuttal of such presumption by the appellant also did not arise in this case. 11. The other legal contention urged by the learned senior counsel is that mere recovery of the alleged tainted money without there being any demand and acceptance by the appellant from the complainant does not prove the guilt of the appellant. In support of his aforesaid legal submission, he has placed reliance upon the following decisions of this Court: (1) K.S. Panduranga Vs. State of Karnataka (2013) 3 SCC 721 (2)Subash Parbat Sonvane Vs. Stat....
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.... counsel for the respondent Dr. Ashok Dhamija has strongly relied upon the version of PW-3, who is an independent witness and sought to justify the impugned judgment and order as the High Court has rightly reversed the judgment and order of acquittal passed by the Trial Court. It has been urged by the learned counsel for the respondent that even though the complainant-PW2 has turned hostile in the case he has admitted his version in the crossexamination and corroborated the evidence of PW-3. 15. Further, the learned counsel for the respondent has contended that the complainant, PW-2 called PW-3 inside the residence of the accused introducing him as his uncle. When PW-3 went inside, the appellant enquired with the complainant if he had brought the money. PW-2, thereafter asked if there was anything to worry about and whether his work would be done. PW-2 handed over the handbag containing the notes towards gratification to the accused who touched the notes with his right hand and placed the hand bag containing the money on the cot made up of steel. Thus, the demand and acceptance of gratification by the appellant from the complainant is duly proved by the witness-PW3. 16. Further, ....
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....itcases, etc... which can never be recovered from the person of an accused. 21. The High Court further held that once demand and acceptance by the accused has been proved then the statutory presumption under Section 20 of the Act arises against him and the onus of proof shifts on him to rebut the presumption by adducing acceptable evidence to prove that he is not guilty of offence. In support of the aforesaid contention, the decision of this Court in the case of M. Narsinga Rao v. State of Andhra Pradesh, 2001 (1) SCC 691 was relied upon wherein it was held thus: "13. Before proceeding further, we may point out that the expressions "may presume" and "shall presume" are defined in Section 4 of the Evidence Act. The presumptions falling under the former category are compendiously known as "factual presumptions" or "discretionary presumptions" and those falling under the latter as "legal presumptions" or "compulsory presumptions". When the expression "shall be presumed" is employed in Section 20(1) of the Act it must have the same import of compulsion. 14. When the sub-section deals with legal presumption it is to be understood as in terrorem i.e. in tone of a command that it has t....
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....e. The discretion is clearly envisaged in Section 114 of the Evidence Act. 17. Presumption is an inference of a certain fact drawn from other proved facts. While inferring the existence of a fact from another, the court is only applying a process of intelligent reasoning which the mind of a prudent man would do under similar circumstances. Presumption is not the final conclusion to be drawn from other facts. But it could as well be final if it remains undisturbed later. Presumption in law of evidence is a rule indicating the stage of shifting the burden of proof. From a certain fact or facts the court can draw an inference and that would remain until such inference is either disproved or dispelled. 18. For the purpose of reaching one conclusion the court can rely on a factual presumption. Unless the presumption is disproved or dispelled or rebutted, the court can treat the presumption as tantamounting to proof. However, as a caution of prudence we have to observe that it may be unsafe to use that presumption to draw yet another discretionary presumption unless there is a statutory compulsion. This Court has indicated so in Suresh Budharmal Kalani v. State of Maharashtra. "A presu....
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....e the payment or otherwise they would seize the goods from my premises. The accused further asked me to make the payment at Gagan Vihar residence. The accused asked me to pay Rs. 60,000/- first on 8.7.1989 at 8.00 a.m. as I could not arrange the entire amount. The accused further asked to make the payment of the remaining balance amount within three-four days. My brother in law, Shri Ram Malhotra was sitting with me at the time of the telephonic conversation." 25. During the cross-examination of PW-2, he has stated that the demand of Rs. 2 lakhs was made by P.S. Saini on 4.7.1989 at his godown between 11.30 to 12.30 p.m. On the very same day, he was taken to office of Customs department where Saini demanded the money at two places i.e. firstly just outside the office of Superintendent and secondly, at the staircase of the office building and on both the occasions, the accused had not demanded the money from the complainant, PW-2 at any time. It has been further stated by him during his crossexamination that on both the occasions, the accused was at a distance of three-four feet. It has been further stated by him that he did not have any direct talk with the accused either at the C....
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....artment to the CBI for verification because the letter was neither received nor seized by him. He recorded the statements of Chamanlal Marwaha and Shri Sharwan Kumar Marwaha during the investigation and after recording their statements under Section 161 Cr.P.C., the said witnesses stated that they were told by the complainant that he has got the accused falsely implicated in this case. After consulting the crime file, witnesses have stated that it is correct that initially this case was recommended for being sent for departmental action and not for criminal prosecution. This recommendation was made after obtaining legal opinion." (emphasis supplied) 29. It is clear from the contents of the aforesaid documentary evidence on record upon which appellant has rightly placed strong reliance that he is innocent is evident from the version of the investigating officer PW-9, who had examined those witnesses at the time of the investigation of the case. They have stated that initially this case was recommended for being sent for departmental action and not for criminal prosecution against the appellant. The said evidence would clearly go to show that there is no case of illegal gratificatio....
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.....K. Damodaran Nair Vs. Government of India (1997) 9 SCC 477 in support of presumption of offence alleged against the appellant which reads thus: "Where, in any trial of an offence punishable under Section 7 or Section 11 or clause (a) or clause (b) of sub-section (1) of Section 13 it is proved that an accused person has accepted or obtained or has agreed to accept or attempted to obtain for himself, or for any other person, any gratification (other than legal remuneration) or any valuable thing from any person, it shall be presumed, unless the contrary is proved, that he accepted or obtained or agreed to accept or attempted to obtain that gratification or that valuable thing, as the case may be, as a motive or reward such as is mentioned in Section 7 or, as the case may be, without consideration or for consideration which he knows to be inadequate." 32. This Court, in K.S. Panduranga's case (supra) has held that the demand and acceptance of the amount of illegal gratification by he accused is a condition precedent to constitute an offence, the relevant paragraph in this regard from the above-said decision is extracted hereunder: "39. Keeping in view that the demand and acc....
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....n unequivocal terms has held that mere demand by itself is not sufficient to establish the offence under the Act. The other aspect, namely acceptance is also very important. There must be clinching evidence with the tacit approval of the accused that money was put by PW 2 on the steel cot as stated by him in his evidence as illegal gratification. In the case in hand, as per the evidence of PW-2 and PW-3, the illegal gratification was in a black rexine bag with a broken zip which was put on a steel cot. As the contents of the bag were not within the knowledge of the accused, therefore, the relevant aspect of the case that the appellant has accepted the illegal gratification as required under Section 7 of the Act is not proved by the prosecution by adducing cogent evidence in this regard. 34. We have examined the evidences on record as a whole, the said evidence is read along with documentary evidence of Exh.PW-1/DA, the contents of which are extracted above. The said document is written by PW-2 in the year 1989, therefore, reliance should be placed on the said evidence. The explanation which is sought to be elicited from the appellant by the prosecution to discard the said positive....
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....to worry and that his work would be done......The accused took the money. The complainant handed over the hand-bag containing the GC notes to the accused. The accused touched ten toes with his right hand and placed that hand bag containing the money on the cot made of steel.......The complainant told that the bag was containing Rs. 60,000/-. 36. The prosecution has placed reliance upon the judgment of this Court viz. State of Madras v. A Vaidhyanatha Iyer AIR 1958 SC 61 in support of the prosecution to justify the findings and reasons recorded by the High Court on the charges leveled against the appellant, to reverse the acquittal and to convict and sentence him for the offence, the relevant portion from the above referred case reads thus: "13. ....Where it is proved that a gratification has been accepted, then the presumption shall at once arise under the section. It introduces an exception to the general rule as to the burden of proof in criminal cases and shifts the onus on to the accused. It may here be mentioned that the legislature has chosen to use the words "shall presume" and not "may presume", the former a presumption of law and latter of fact. Both these phrases have b....
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....of acquittal rendered by the High Court. Against such decision of the High Court, the scope of interference by this Court in an order of acquittal has been very succinctly laid down by a three-Judge Bench of this Court in Sanwat Singh v. State of Rajasthan. At SCR p. 129, Subba Rao, J. (as His Lordship then was) culled out the principles as follows: "9. The foregoing discussion yields the following results: (1) an appellate court has full power to review the evidence upon which the order of acquittal is founded; (2) the principles laid down in Sheo Swarup case, afford a correct guide for the appellate court's approach to a case in disposing of such an appeal; and (3) the different phraseology used in the judgments of this Court, such as, (i) 'substantial and compelling reasons', (ii) 'good and sufficiently cogent reasons', and (iii) 'strong reasons', are not intended to curtail the undoubted power of an appellate court in an appeal against acquittal to review the entire evidence and to come to its own conclusion; but in doing so it should not only consider every matter on record having a bearing on the questions of fact and the reasons given by the court below in support of its or....
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....acquitted at his trial; (3) the right of the accused to the benefit of any doubt; and (4) the slowness of an appellate court in disturbing a finding of fact arrived at by a Judge who had the advantage of seeing the witnesses. To state this, however, is only to say that the High Court in its conduct of the appeal should and will act in accordance with rules and principles well known and recognised in the administration of justice." 20. The principles of law laid down by the Privy Council in Sheo Swarup have been consistently followed by this Court in a series of subsequent pronouncements of which reference may be illustratively made to the following: Tulsiram Kanu v. State, Balbir Singh v. State of Punjab, M.G. Agarwal v. State of Maharashtra, Khedu Mohton v. State of Bihar, Sambasivan v. State of Kerala, Bhagwan Singh v. State of M.P. and State of Goa v. Sanjay Thakran. 21. A concise statement of the law on the issue that had emerged after over half a century of evolution since Sheo Swarup is to be found in para 42 of the Report in Chandrappa v. State of Karnataka. The same may, therefore, be usefully noticed below: "42. From the above decisions, in our considered view, the foll....
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....ovides a statutory right of appeal to the accused in such a case. The aforesaid distinction, therefore, has to be kept in mind and due notice must be had of the legislative intent to confer a special status to an appeal before this Court against an order of the High Court altering the acquittal made by the trial court. The issue had been dealt with by this Court in State of Rajasthan v. Abdul Mannan in the following terms, though in a different context: (SCC pp. 70-71, para 12) "12. As is evident from the above recorded findings, the judgment of conviction was converted to a judgment of acquittal by the High Court. Thus, the first and foremost question that we need to consider is in what circumstances this Court should interfere with the judgment of acquittal. Against an order of acquittal, an appeal by the State is maintainable to this Court only with the leave of the court. On the contrary, if the judgment of acquittal passed by the trial court is set aside by the High Court, and the accused is sentenced to death, or life imprisonment or imprisonment for more than 10 years, then the right of appeal of the accused is treated as an absolute right subject to the provisions of....