TaxTMI 
TaxTMI 
TaxTMI 
2015 (11) TMI 1862
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....n sources of income and thereby abetted the commission of offence u/s 13(1)(e) of the Prevention of Corruption Act punishable u/s 13(2) of the Prevention of Corruption Act by Ramesh Nambiar and thereby committed offence u/s 109 IPC r/w Sec. 13 (1)(e) and 13(2) of Prevention of Corruption Act and within my cognizance and jurisdiction." 2. Since, both the petitions arise from the same order, this Court has decided to dispose of these petitions by way of this common judgment. 3. The case against the petitioners was registered on 22.02.2010, on the basis of a source information, against accused No.1/Ramesh Nambiar, husband of accused No. 2 Rekha Nambiar (petitioner in W.P.(CRL) No. 1432/2014 ) along with accused No. 3 Bhojraj Teli (petitioner in CRL.M.C. No. 4781/2014) Managing Director of M/s. HYT Group of Companies, Naveen Patil and Rekha Nambiar under Sections 13 (2) read with Section 13(1)(e) of Prevention of Corruption Act, 1988 ('PC Act') and Section 109 of the Indian Penal Code, 1860 ('IPC') on the allegations that accused Ramesh Nambiar while posted and functioning as AGM (Sport), Air India at New Delhi and other places, being a public servant, amassed assets worth about Rs.2....
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....portionate assets by accused Ramesh Nambiar by receiving an amount of Rs.1,04,07,829/- as consultancy fee from accused No.3/Bhojraj Teli, Managing Director of M/s. HYT Group of Companies and creating assets out of the same, though she had not done any real consultancy work for petitioner Bhojraj Teli. Similarly, petitioner Bhojraj Teli abetted the offence in acquiring the disproportionate assets by accused Ramesh Nambiar by paying the above amount as consultancy fees etc. to petitioner Rekha Nambiar without her having rendered any real consultancy and by allowing his credit card to be used by said accused Ramesh Nambiar and by making payments by cheque for expenditure of accused Ramesh Nambiar and his family members without proper justification. 8. The case of the CBI is that about 15 to 20 years back, petitioner Bhojraj Teli came in contact with accused Ramesh Nambiar and his wife petitioner Rekha Nambiar and developed friendly relations with them. Petitioner Bhojraj Teli had been visiting the office of accused Ramesh Nambiar, when he was posted as a Private Secretary to the then Minister of State for Railways during 1995-1996. Initially, he went to the office of the Minister of ....
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....d that in the absence of any record relating to consultancy at this stage of charge these entries have to be rejected and the entire such income is to be taken into account to see the extent of disproportion. The genuineness of the entries in favour of petitioner Rekha Nambiar has to be established during trial only and no benefit of the same can be given at this stage. Further recorded that letter dated 17.05.2010 of the Deutsche Bank and the statement of Account (D-36) of the said Bank reveal that petitioner Rekha Nambiar was in the employment of the said Bank up to June, 2008 and taking up of any other employment, consultancy etc. during the currency of employment with Deutsche Bank without prior written permission of the Bank was prohibited and nothing available on record that petitioner Rekha Nambiar had taken any prior written permission from the Bank before rendering any consultancy to petitioner Bhojraj Teli from 2006 onwards. Accordingly, no benefit of consultancy fee can be allowed at this stage of charge. 12. Mr. Bansal submitted that the learned Trial Court in its impugned order dated 01.05.2014 further recorded that the explanation that money belongs to petitioner Rek....
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.... incriminating records were seized during search conducted in the above case from the residence and office premises of Shri Ramesh Nambiar. Information received shows that Shri Ramesh Nambiar has been involved in illegal activities of a middleman/tout and through which he has been earning substantial commission in connivance with various industrialists. Shri Ramesh Nambiar obtained unlawful commissions through one Shri Bhoj Raj Teli of M/s. HYT Group of Companies in the name of consultancy fees for his wife and routed the same through a company M/s. Archana Traders Pvt. Ltd. wherein Sh. Naveen Patil and his father-in-law are the major share holders / Directors. The information discloses that Shri Ramesh Nambiar along with his wife have acquired assets disproportionate to their known sources of income as discussed above, and Shri Bhojraj Teli of M/s. HYT Group of Companies, M/s. Archana Traders Pvt. Ltd. and Shri Navin Patil have abetted Shri Ramesh Nambiar by various means in acquiring disproportionate assets. Therefore, the information prima facie discloses commission of offence punishable under Section 13 (2) r/w 13 (e) of PC Act, 1988 and Section 109 IPC." 16. Mr. Bansal furt....
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....mitted the offence, can only be decided in the trial. xxxx xxxx xxxx 19. Some of the questions, however, which have been raised by the appellant are of some importance and it may be necessary to deal therewith. The learned Trial Judge, it appears, did not properly apply its mind in regard to the different categories of accused while framing charges. It ought to have been done. Charge may although be directed to be framed when there exists a strong suspicion but it is also trite that the court must come to a prima facie finding that there exists some materials the....
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....amination, it has been brought out that PW-10 had deposited Rs. 100 to Rs. 200 per month in the account of Dr. Ravindra Reddy during 1981-82; but Ravindra Reddy's account is not produced to corroborate the evidence of PW-10. In view of the evidence that the amount was used to be given by Dr. Indira Reddi herself on many occasions, we are of the view that Exs.P-27 to 35 will not help the prosecution in establishing the allegation that the entire amount was deposited only by the appellant's wife to the credit of Dr. Indira. However, we are not impressed by the evidence of PW-10. Therefore, we do not find any force in the submission made by the prosecution that this amount standing to the credit of Dr. Indira was benami and that the ostensible owner of the amount was only the appellant." 19. Mr. Luthra further submitted that case of the CBI is that accused No.1. Ramesh Nambair had transferred unaccounted money in the account of M/s Archana Traders, which was further transferred to the account of M/s HYT Group of Companies, which in turn paid the money to petitioner Rekha Nambiar, wife of accused No.1 as consultation fees. However, it is further stated in the charge sheet that....
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....ands of the husband or as the case may be, it cannot be fastened on the husband or head of family. It is true that the prosecution in the present case has tried its best to lead the evidence to show that all these moneys belonged to the accused but when the wife has fully owned the entire money and the other wealth earned by her by not showing in the Income-tax return and she has accepted the whole responsibilities, in that case, it is very difficult to hold the accused guilty of the charge. It is very difficult to segregate that how much of wealth belonged to the husband and how much belonged to the wife. The prosecution has not been able to lead evidence to establish that some of the money could be held in the hands of the accused. In case of joint possession it is very difficult when one of the persons accepted the entire responsibility. The wife of the accused has not been prosecuted and it is only the husband who has been charged being the public servant. In view of the explanation given by the husband and when it has been substantiated by the evidence of the wife, the other witnesses who have been produced on behalf of the accused coupled with the fact that the entire money h....
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....rt recorded in para No.5 of the impugned order that there is no document to show that petitioner Rekha Nambiar is a Consultant is contrary to the record. 24. Learned counsel further submitted that finding of the learned Trial Court in para No.9 of the impugned order is contrary to the documents relied upon by the CBI. Clause 12 of the MoU dated 04.06.2006 clearly states that Rekha Nambiar will be entitled to reimbursement of travel expenses. However, learned Trial Court erred in not considering the documents which clearly exonerates the petitioner. 25. Mr.Luthra submitted that the learned Trial Court in para 17 of the impugned order erred by not taking into account the salary of Rekha Nambiar which she had earned for rendering her services to M/s HYT Innovative Projects Pvt. Ltd. Furthermore, findings of the learned Trial Court in para No.19 are contrary to the record in as much as the services rendered by Rekha Nambiar were concerned. 26. To buttress his contentions, learned senior counsel relied upon case of S.K.Alagh vs State of Uttar Pradesh & Ors (2008) 5 SCC 662, wherein the Supreme Court held as under:- "14. Appellant No.1 is the Managing Director of the Company. Respon....
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....2 Act specifically creates an offence of criminal breach of trust in respect of the amount deducted from the employees by the company. In terms of the explanations appended to Section 405 of the Indian Penal Code, a legal fiction has been created to the effect that the employer shall be deemed to have committed an offence of criminal breach of trust. Whereas a person in charge of the affairs of the company and in control thereof has been made vicariously liable for the offence committed by the company along with the company but even in a case falling under Section 406of the Indian Penal Code vicarious liability has been held to be not extendable to the Directors or officers of the company. {See Maksud Saiyed v. State of Gujarat and Ors. [2007 (11) SCALE 318]}." 27. While concluding his arguments, learned senior counsel submitted that money paid by M/s HYT Group of Companies to petitioner Rekha Nambiar has been duly shown in the books of accounts and in the ITRs of the respective years. Moreover, petitioner Rekha Nambiar had also disclosed the income received from M/s HYT Group of Companies in her ITRs, however the learned Trial Court has ignored both the documents mentioned above ....
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....p; xxxx 14. We have perused the records and we agree with the above views expressed by the High Court. We find that in the alleged trap no police agency was involved; the FIR was lodged after seven days; no incriminating articles were found in the possession of the accused and statements of witnesses were recorded by police after ten months of the occurrence. We are, therefore, of the opinion that not to speak of grave suspicion against the accused, in fact prosecution has not been able to throw any suspicion. We, therefore, hold that no prima facie case was made against the appellant." 30. Also relied upon Prashant Bhaskar vs State (Government of NCT of Delhi) 2014 [1] JCC 750, wherein the Coordinate Bench of this Court held as under:- "14. Reliance has been placed on the pronouncements of the Apex Court reported at (2009) 1 SCC Crl. 51 Yogesh @ Sachin Jagdish Joshi Vs. State of Maharashtra & 1990 Crl.Law Journal 1869 Niranjan Singh Karam Singh Punjabi Vs. Jitendra Bhimraj Bijja & Ors. ....
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....ge of deciding whether or not there exist sufficient grounds for framing the charge, his enquiry must necessarily be limited to deciding if the facts emerging from the record and documents constitute the offence with which the accused is charged. At that stage he may sift the evidence for that limited purpose but he is not required to marshal the evidence with a view to separating the grain from the chaff. All that he is called upon to consider is whether there is sufficient ground to frame the charge and for this limited purpose he must weigh the material on record as well as the documents relied on by the prosecution. In the State of Bihar v. Ramesh Singh 1977 CriLJ 1606 this Court observed that at the initial stage of the framing of a charge, if there is a strong suspicion-evidence which leads the Court to think that there is ground for presuming that the accused has committed an offence then it is not open to the Court to say that there is no sufficient ground for proceeding against the accused. If the evidence which the prosecutor proposes to adduce to prove the guilt of the accused, even if fully accepted before it is challenged by cross-examination or rebutted by the defence....
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.... the pros and cons of the matter and weigh the evidence as if he was conducting a trial. xxxx From the above discussion it seems well settled that at the Sections 227-228 stage the court is required to evaluate the material and documents on record with a view to finding out if the facts emerging therefrom taken at their face value disclose the existence of all the ingredients constituting the alleged offence. The court may for this limited purpose sift the evidence as it cannot be expected even at the 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) xxxx xxxx ....
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....t did, on the available materials, and the allegations leveled in the charge-sheet. Its order therefore, cannot be sustained. " 32. On the other hand, Ms. Sonia Mathur, learned counsel appearing on behalf of the CBI in W.P.(CRL) No. 1432/2014 submitted that the petitioners have been charged for abetting the offence committed by accused Ramesh Nambiar, who was a public servant and alleged to have accumulated assets disproportionate to his known sources of income worth about Rs.2,08,38,170/- during the check period from 14.10.1991 to 30.06.2009 in his name, in the name of his wife, i.e., petitioner Rekha Nambiar and his family members. Further submitted that petitioner Bhojraj Teli colluded with accused Ramesh Nambiar to justify his tainted money by making available his companies to transfer the money of accused Ramesh Nambiar to his wife petitioner Rekha Nambiar. 33. Learned counsel further submitted that while framing the charge, the learned Trial Court has considered inter alia the facts that there is no evidence/document on record to establish her appointment as a Consultant with M/s. HYT Group of Companies. There is no evidence with regard to nature of work done by petitioner ....
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....close voluntarily causes or procures, or attempts to cause or procure, a thing to be done, is said to instigate the doing of that thing. For the "Thirdly" Clause (i.e. intentionally aids) the following Explanation is added: Explanation 2.-Whoever, either prior to or at the time of the commission of an act, does anything in order to facilitate the commission of that act, and thereby facilitates the commission thereof, is said to aid the doing of that act. 22. Shri Shanti Bhushan cited certain illustrations which, according to us, would amplify the cases of abetments fitting with each of the three clauses in Section 107of the Penal Code vis-a-vis Section 13(1)(e) of the P.C. Act. The first illustration cited is this: If A, a close relative of the public servant tells him of how other public servants have become more wealthy by receiving bribes and A persuades the public servant to do the same in order to become rich and the public servant acts accordingly. If it is a proved position there cannot be any doubt that A has abetted the offence by instigation. Next illustration is this: Four persons including the public servant decide to raise a bulk amount through bribery and ....
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.... on record to make out the case and there is an abuse of the process of the Court. The settled law is that the competent court while considering the question of the framing of charge has the power to sift and weigh the evidence for the limited purpose of finding out whether or not a prima facie case is made out against the accused. Where the material placed before the Court disclosed grave suspicion against the accused which has not been properly explained, the Court would be fully justified in framing the charge and proceeding with the trial. Further, if on the basis of material on record, the Court could form an opinion that the accused might have committed offence, it can frame the charge. At the time of framing of charges, the probative value of the material on record cannot be gone into, but before framing of charge, the Court ought to apply its judicious mind on the materials placed on record and must be satisfied that the commission of offence by the accused is possible. 38. Mr.Narender Mann, learned Special Public Prosecutor appearing on behalf of the CBI in CRL.M.C. No. 4781/2014 submitted that at the stage of charge, the Court would not ordinarily consider as to whether ....
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....ld that a non-public servant is also liable to be tried along with the public servant before the Court of Special Judge having jurisdiction over the matter for commission of the offences punishable under Section 109 IPC read with Sections 13 (1) (e) and 13 (2) PC Act. When the material on record per se sufficient for the Court to form an opinion that the accused person has committed the offence alleged against him, there is no reason why the charge against the accused should be quashed at such a preliminary stage when only charges having been framed and prosecution has to lead evidence in support of its case. 42. Learned counsel has relied upon the recent decision rendered by this Court on 05.10.2015 in Crl.M.C.No.4402/2014 Rekha Rani vs CBI Through its Standing Counsel, wherein it has been observed as under:- "17. It is settled law that at the time of framing of charge, the Court is not expected to hold mini trial and delve deep into the matter for the purposes of appreciating the evidence and the evidence can only be weighed when the entire material will be brought before the Trial Court. The Court was required to see at the time of framing charge whether a strong suspicion ex....
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....Board in connection with his business of supply of machines of Indian Railways etc. Petitioner Bhojraj Teli used to receive orders for supply of machines through various Railway Zones from 1981 onwards. 46. Further case of the CBI that accused Ramesh Nambiar obtained unlawful commission through petitioner Bhojraj Teli of M/s. HYT Group of Companies in the name of consultancy fee for his wife and routed the same through M/s Archana Traders Pvt. Ltd., wherein Naveen Patil and father of petitioner Rekha Nambiar were the major shareholders/Directors. It is not in dispute that investigation could not reveal any evidence to show that accused Ramesh Nambiar had invested the funds in M/s Archana Traders Pvt. Ltd. directly or indirectly. 47. In the case of P. Nallammal etc.(supra), the Apex Court held that a non-public servant is also liable to be tried along with the public servant before the Court of Special Judge having jurisdiction over the matter for commission of the offences punishable under Section 109 IPC read with Sections 13 (1) (e) and 13 (2) PC Act, when the material on record per se sufficient for the Court to form an opinion that the accused person has committed the offence....
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...., 2008. The learned Trial Court further recorded that the explanation that money belongs to petitioner Rekha Nambiar cannot be accepted at the stage of charge, even though reflected in ITRs of Rekha Nambiar. However, the learned Trial Court ignored the MoU dated 04.06.2006 (D-13), which is an investors' agreement, wherein petitioner Rekha Nambiar agreed to contribute 20% of the paid up capital of M/s HYT Innovative Projects Ltd. Moreover, the learned Trial Court has ignored the statement of K.B. Surve (PW3), who stated that petitioner Rekha Nambiar was paid salary from April, 2008 to October, 2008 amounting to Rs.21,00,000/-. The learned Trial Court has only considered the salary received from Deutsche Bank by petitioner Rekha Nambiar while calculating the disproportionate assets, however, ignored the consultancy fee, credit card used and travel expenses, which were duly intimated to the Income Tax Authority in ITRs. It shows that the learned Trial Court has ignored each and every aspect which is in favour of the petitioners and was on record. However, the learned Trial Court framed the charges only on the ground that petitioner Rekha Nambiar was not authorized to undertake any suc....
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....er Section 13 (2) r/w 13 (1)(e) of PC Act 1988 against Sh. Ramesh Nambiar (A-1) and constitute offences, punishable under Section 109 r/w 13 (1) (e) of PC Act against Smt. Rekha Nambiar (A-2) and Sh. Bhojraj Teli (A-3). As investigation could not reveal and evidence against M/s. Archana Traders Pvt. Ltd. and Sh. Naveen Patil, hence, they are not sent up for trial." 52. Thus, once the very basis and genesis of the allegation stood disappeared, then could still the petitioners be prosecuted, is a question to be considered. 53. In order to bring home the guilt, either the prosecution was bound to establish that the amount of income shown in the name of the petitioner was bribe amount being paid to her husband or that it was the unaccounted money of her, which was being converted to the accounted one. The prosecution, however, did not allege either of the two, but had alleged that husband of the petitioner had obtained unlawful commission through petitioner Bhojraj Teli by routing the same through M/s Archana Traders Pvt. Ltd. But the fact remains that CBI could not establish the complicity of M/s Archana Traders Pvt. Ltd, consequently, the chargesheet has not been filed against said....
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.... in any manner, connected with the unaccounted money of accused No.1. The allegations against petitioner Rekha Nambiar is that she was not allowed to take further employment without the prior permission of Deutsche Bank cannot be read against petitioner Bhoj Raj Teli. Moreover, the second employment of petitioner Rekha Nambiar is not a criminal act and it can at best make her liable for departmental action. 56. The allegations of prosecution with regard to any real work being done by petitioner Rekha Nambiar are unsubstantiated. The prosecution has relied upon two documents, which were the Shareholders' Agreement dated 13.12.2012 and the MoU dated 04.06.2006 annexed as Annexures 1 and 2 respectively. Clause 5 of the Shareholders' Agreement and Clauses 1,4,6,9 & 12 of the MoU mentioned above clearly establish that petitioner Rekha Nambiar had rendered her services as Consultant, Advisor and Director of M/s HYT Innovative Projects Pvt. Ltd. She had contributed 20% of the paid up capital in M/s HYT Innovative Projects Pvt. Ltd. She assisted them in marketing the company's products. Moreover none of the Directors of M/s HYT Group of Companies were to be changed without permission of R....
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.... attracting vicarious liability on the petitioner for acts allegedly committed on behalf of the said Company, the order on charge is liable to be set aside qua the petitioner. 59. In case of R Kalyani vs Janak C Metha and Others, (2009) 1 SCC 516, the Apex Court observed as under:- "41. If a person, thus, has to be proceeded with as being variously liable for the acts of the company, the company must be made an accused. In any event, it would be a fair thing to do so, as legal fiction is raised both against the Company as well as the person responsible for the acts of the Company." 60. There is evidence on record to establish that money paid by the M/s HYT Group of Companies to petitioner Rekha Nambiar has been duly shown in the books of accounts and in the ITRs of the respective years. Moreover, petitioner Rekha Nambiar had also disclosed the income received from M/s HYT Group of Companies in her ITRs, however the learned Trial Court has ignored both the documents mentioned above and opined that these documents are matter of trial. 61. It is true that the evidence in possession of the accused will be considered at the time of trial, however, the fact remains in the instant ca....