TaxTMI 
TaxTMI 
2021 (10) TMI 1376
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....iable to be quashed in the present case F Conclusion A. The Appeal 1. The appeal arises from a judgment dated 11 February 2020 of a Single Judge of the High Court for the State of Telangana, by which: (i) a Writ Petition No. 8552 of 2018 filed by the Respondents Under Article 226 of the Constitution of India was allowed; and (ii) the First Information Report "FIR" dated 20 September 2017 registered against the Respondents was set aside, together with proceedings taken up pursuant to the FIR. 2. The first Respondent is a Commissioner of Income Tax while the second Respondent is her spouse. The second Respondent is a Member of the Legislative Assembly "MLA" and is a Minister in the State government of Andhra Pradesh. The FIR No RC MAI 2017 A 0021 dated 20 September 2017 has been registered against the first Respondent for being in possession (allegedly) of assets disproportionate to her known sources of income. The second Respondent is alleged to have abetted the offence. The FIR has thus been registered for offences punishable Under Section 13(2) read with Section 13(1)(e) of the Prevention of Corruption Act 1988 "PC Act" and Section 109 of the Indian Penal Code 1860 "IPC". The....
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....s' assets at the beginning of the check period (1 April 2010) were in the amount of Rs. 1,35,26,066 while Statement-B indicates that their assets at the end of the check period (29 February 2016) were Rs. 6,90,51,066. Hence, their assets earned during the check period (i.e., between 1 April 2010 to 29 February 2016) were alleged to be to the tune of Rs. 5,55,25,000. According to Statement-C, the Respondents' income during the check period was Rs. 4,84,76,630 while according to Statement-D their expenditure during the check period was Rs. 40,33,322. Hence, the Respondents are alleged to have acquired assets/pecuniary advantage to the extent of Rs. 5,95,58,322 (adding the Assets, Rs. 5,55,25,000 and Expenditure, Rs. 40,33,322) against an Income of Rs. 4,84,76,630 earned during the check period. Therefore, their Disproportionate Assets Calculated by adding the Assets and Expenditure during the check period, and subtracting the Income from it. during the check period were computed at Rs. 1,10,81,692, which is 22.86 per cent of the total income earned by them. The computation reflected in the FIR is as follows: Calculation of Disproportionate Assets: Sl. No. Particulars of A....
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.... source information, and the case was still under investigation; (iv) the Respondents would be provided a chance to explain their case during the investigation, and there was no requirement to conduct Preliminary Enquiry before the registration of the FIR; and (v) the Respondents' income and assets cannot be conclusively ascertained from the documents annexed by them, since their veracity has to be determined during the investigation. Hence, the Appellants urged that the FIR could not be quashed. 8. As noted earlier in this judgment, the Telangana High Court allowed the Respondents' writ petition by its impugned judgment dated 11 February 2020 and quashed the FIR, and set aside all proceedings initiated pursuant to it. The Appellant CBI has now moved this Court for challenging the decision of the High Court. C. Counsel's submissions 9. Assailing the judgment of the Telangana High Court, Ms. Aishwarya Bhati, Additional Solicitor General "ASG" appearing on behalf of the CBI has urged the following submissions: (i) The Telangana High Court did not have the jurisdiction to entertain the writ petition filed by the Respondents since: a. The FIR had been registered by t....
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....ty is available to the Accused persons at the stage of trial. This principle emerges from the judgments of this Court in K. Veeraswami v. Union of India (1991) 3 SCC 655, para 75 ("K. Veeraswami"), Union of India and Anr. v. W.N. Chadha (1993) Supp (4) SCC 260, paras 90-98, State of Maharashtra v. lshwar Piraji Kalpatri (1996) 1 SCC 542, paras 16-17, Narendar G. Goel v. State of Maharashtra (2009) 6 SCC 65, paras 11-16 and Samaj Parivarthan Samudhaya v. State of Karnataka (2012) 7 SCC 407, paras 49-50 and 60; (vii) The FIR has been registered against the second Respondent Under Section 109 of the Indian Penal Code as an abettor, being in a fiduciary relationship with the first Respondent as her spouse. As such, no consent of the Speaker was required before the registration of the FIR against the second Respondent. A general consent has been accorded to the CBI by the State of Tamil Nadu Notification dated 2 July 1992 Under Section 6 of the Delhi Special Police Establishment Act 1946 "DSPE Act" for the offences under the PC Act, which have been notified Under Section 3 of the DSPE Act. The first Respondent is an officer of the Union Government, serving in the IRS; (viii) While h....
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....hanti Mishra v. Union of India (2020) 10 SCC 766, para 33, Navinchandra N. Majithia v. State of Maharashtra (2000) 7 SCC 640, paras 16-18 and 22, Pepsi Foods Ltd. v. Special Judicial Magistrate (1998) 5 SCC 749, para 29 and Kapil Agarwal v. Sanjay Sharma (2021) 5 SCC 524, paras 18-18.2; and b. In any case, CBI admitted to the jurisdiction of the Telangana High Court when it did not challenge its initial order dated 24 September 2019 admitting the Respondents' writ petition; (ii) In view of the decision of this Court in Vineet Narain v. Union of India 1998 : (1998) 1 SCC 226, para 58(12) ("Vineet Narain"), the provisions of the CBI Manual must be followed strictly by the CBI. This has been reiterated in Shashikant v. CBI (2007) 1 SCC 630, paras 9, 11, 19 and 25 ("Shashikant"), CBI v. Ashok Kumar Aggarwal (2014) 14 SCC 295, paras 22-24 ("Ashok Kumar Aggarwal") and State of Jharkhand v. Lalu Prasad Yadav (2017) 8 SCC 1, paras 67-69; (iii) According to para 9.1 of the CBI Manual, a Preliminary Enquiry must be conducted before an FIR is registered in order to collect sufficient material which prima facie establishes the commission of an offence. This is emphasized in the judgm....
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....-99 and State of Kerala v. K. Ajith and Ors. Criminal Appeal No. 698 of 2021, paras 24, 33, 36-39 and 61-64; b. Even according to the decision of this Court in State of West Bengal v. Committee for Protection of Democratic Rights (2010) 3 SCC 571, para 68, the CBI can exercise powers and jurisdiction under the PC Act against an MLA or an MP only on a direction of this Court/High Court or on an order from the Speaker; c. The CBI has no authority since under the DSPE Act: i. No notification has been issued by the Central Government specifying the offences against an MLA to be investigated by the CBI (Section 3 of the DSPE Act); ii. No order has been passed by the Central Government extending the powers and jurisdiction of CBI in the State of Telangana in respect of the offences specified Under Section 3 (Section 5 of the DSPE Act); iii. Consent of the State Government has not been obtained for the exercise of powers by the CBI in the State of Telangana (Section 6 of the DSPE Act); and iv. In support of this, reliance is placed upon judgments of this Court in Mayawati v. Union of India (2012) 8 SCC 106, paras 29-30, M. Balakrishna Reddy v. CBI (2008) 4 SCC 409, para 19, Ce....
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.... (x) The High Court has not solely relied upon the documents produced by the Respondents, while ignoring the material elicited by the CBI through its investigation. The documents produced by the Respondent (Income Tax Returns, et al) are lawful sources to determine the source of one's income, and can be relied upon while determining whether a 'public servant' Under Section 13(1)(e) of the PC Act has accumulated Disproportionate Assets in comparison to their lawful income. Hence, the High Court could have legitimately assessed the case of Disproportionate Assets against the Respondents by relying on such documents. In support of this proposition, reliance is placed upon judgments of this Court in Harshendra Kumar D. v. Rebatilata Koley (2011) 3 SCC 351, paras 25-26, Suresh Kumar Goyal v. State of U.P. (2019) 14 SCC 318, para 12, Pooja Ravinder Devidasani v. State of Maharashtra (2014) 16 SCC 1, paras 15, 17, 23, 27-28 and 30, Kedari Lal v. State of M.P. (2015) 14 SCC 505, paras 10, 12 and 15-16 ("Kedari Lal") and State of M.P. v. Mohanlal Soni (2000) 6 SCC 338, paras 4, 6 and 11; and (xi) The FIR deserved to be quashed in terms of the guidelines enunciated in paragra....
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....en given the said power in Chapter VI of the CBI Manual. A prima facie case may be held to have been established only on completion of a preliminary enquiry. 15. The most authoritative pronouncement of law emerges from the decision of a Constitution Bench in Lalita Kumari (supra). The issue before the Court was whether "a police officer is bound to register a first information report (FIR) upon receiving any information relating to commission of a cognizable offence Under Section 154 of the Code of Criminal Procedure 1973...or the police officer has the power to conduct a 'preliminary inquiry' in order to test the veracity of such information before registering the same". Answering this question on behalf of the Bench, Chief Justice P Sathasivam held that Under Section 154 of the Code of Criminal Procedure 1973 "CrPC", a police officer need not conduct a preliminary enquiry and must register an FIR when the information received discloses the commission of a cognizable offence. Specifically with reference to the provisions of the CBI Manual, the decision noted: 89. Besides, the learned Senior Counsel relied on the special procedures prescribed under the CBI Manual to be r....
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....e is no other option but to register an FIR forthwith. Other considerations are not relevant at the stage of registration of FIR, such as, whether the information is falsely given, whether the information is genuine, whether the information is credible, etc. These are the issues that have to be verified during the investigation of the FIR. At the stage of registration of FIR, what is to be seen is merely whether the information given ex facie discloses the commission of a cognizable offence. If, after investigation, the information given is found to be false, there is always an option to prosecute the complainant for filing a false FIR. (emphasis supplied) The judgment provides the following conclusions: 120. In view of the aforesaid discussion, we hold: 120.1. The registration of FIR is mandatory Under Section 154 of the Code, if the information discloses commission of a cognizable offence and no preliminary inquiry is permissible in such a situation. 120.2. If the information received does not disclose a cognizable offence but indicates the necessity for an inquiry, a preliminary inquiry may be conducted only to ascertain whether cognizable offence is disclosed or not. ....
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.... [P. Sirajuddin v. State of Madras, (1970) 1 SCC 595 : 1970 SCC (Cri.) 240] and took the view that in the context of offences related to corruption in the said decision, the Court has expressed a need for a preliminary inquiry before proceeding against public servants. [...] 112. In Lalita Kumari [Lalita Kumari v. State of U.P., (2014) 2 SCC 1 : (2014) 1 SCC (Cri.) 524], one of the contentions which was pressed before the Court was that in certain situations, preliminary inquiry is necessary. In this regard, attention of the Court was drawn to CBI Crime Manual... [...] 114. The Constitution Bench in Lalita Kumari [Lalita Kumari v. State of U.P., (2014) 2 SCC 1 : (2014) 1 SCC (Cri.) 524], had before it, the CBI Crime Manual. It also considered the decision of this Court in P. Sirajuddin [P. Sirajuddin v. State of Madras, (1970) 1 SCC 595 : 1970 SCC (Cri.) 240] which declared the necessity for preliminary inquiry in offences relating to corruption. Therefore, the Petitioners may not be justified in approaching this Court seeking the relief of registration of an FIR and investigation on the same as such. This is for the reason that one of the exceptions where immediate registr....
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....nary inquiry being necessary before lodging an FIR would depend upon the facts of each case. There is no set format or manner in which a preliminary inquiry is to be conducted. The objective of the same is only to ensure that a criminal investigation process is not initiated on a frivolous and untenable complaint. That is the test laid down in Lalita Kumari [Lalita Kumari v. State of U.P., (2014) 2 SCC 1 : (2014) 1 SCC (Cri.) 524]. 33. In the present case, the FIR itself shows that the information collected is in respect of disproportionate assets of the Accused officer. The purpose of a preliminary inquiry is to screen wholly frivolous and motivated complaints, in furtherance of acting fairly and objectively. Herein, relevant information was available with the informant in respect of prima facie allegations disclosing a cognizable offence. Therefore, once the officer recording the FIR is satisfied with such disclosure, he can proceed against the Accused even without conducting any inquiry or by any other manner on the basis of the credible information received by him. It cannot be said that the FIR is liable to be quashed for the reason that the preliminary inquiry was not condu....
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....[Lalita Kumari v. State of U.P., (2014) 2 SCC 1 : (2014) 1 SCC (Cri.) 524]. 11.1. While considering the larger question, whether police is duty-bound to register an FIR and/or it is mandatory for registration of FIR on receipt of information disclosing a cognizable offence and whether it is mandatory or the police officer has option, discretion or latitude of conducting preliminary enquiry before registering FIR, this Court in Lalita Kumari [Lalita Kumari v. State of U.P., (2014) 2 SCC 1: (2014) 1 SCC (Cri.) 524] has observed that it is mandatory to register an FIR on receipt of information disclosing a cognizable offence and it is the general rule. However, while holding so, this Court has also considered the situations/cases in which preliminary enquiry is permissible/desirable. case. While holding that the registration of FIR is mandatory Under Section 154, if the information discloses commission of a cognizable offence and no preliminary enquiry is permissible in such a situation and the same is the general Rule and must be strictly complied with, this Court has carved out certain situations/cases in which the preliminary enquiry is held to be permissible/desirable before reg....
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....ce by a public servant, before lodging the first information report and further conducting the investigation, if the preliminary enquiry is conducted to ascertain whether a cognizable offence is disclosed or not, no fault can be found. Even at the stage of registering the FIR, what is required to be considered is whether the information given discloses the commission of a cognizable offence and the information so lodged must provide a basis for the police officer to suspect the commission of a cognizable offence. At this stage, it is enough if the police officer on the basis of the information given suspects the commission of a cognizable offence, and not that he must be convinced or satisfied that a cognizable offence has been committed. Despite the proposition of law laid down by this Court in a catena of decisions that at the stage of lodging the first information report, the police officer need not be satisfied or convinced that a cognizable offence has been committed, considering the observations made by this Court in P. Sirajuddin [P. Sirajuddin v. State of Madras, (1970) 1 SCC 595 : 1970 SCC (Cri.) 240] and considering the observations by this Court in Lalita Kumari [Lalita ....
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....the Investigating Officer to explain the alleged disproportionality between assets and the known sources of income. The Investigating Officer is required to consider his explanation and the charge-sheet filed by him must contain such averment. The failure to mention that requirement would vitiate the charge-sheet and renders it invalid. This submission, if we may say so, completely overlooks the powers of the Investigating Officer. The Investigating Officer is only required to collect material to find out whether the offence alleged appears to have been committed. In the course of the investigation, he may examine the Accused. He may seek his clarification and if necessary he may cross check with him about his known sources of income and assets possessed by him. Indeed, fair investigation requires as rightly stated by Mr. A.D. Giri, learned Solicitor General, that the Accused should not be kept in darkness. He should be taken into confidence if he is willing to cooperate. But to state that after collection of all material the Investigating Officer must give an opportunity to the Accused and call upon him to account for the excess of the assets over the known sources of income and t....
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....liminary inquiry and a regular case. A preliminary inquiry in terms of para 9.1 of the CBI Manual may be converted into a regular case as soon as sufficient material becomes available to show that prima facie there has been commission of a cognizable offence. [...] 19. When an anonymous complaint is received, no investigating officer would initiate investigative process immediately thereupon. It may for good reasons carry out a preliminary enquiry to find out the truth or otherwise of the allegations contained therein. [...] 25...The procedure laid down in the CBI Manual and in particular when it was required to inquire into the allegation of the corruption on the part of some public servants, recourse to the provisions of the Manual cannot be said to be unfair... (emphasis supplied) 24. In Ashok Kumar Aggarwal (supra), a two judge Bench observed that the provisions of the CBI Manual require strict compliance. Justice B.S. Chauhan held: 24...the CBI Manual, being based on statutory provisions of Code of Criminal Procedure, provides for guidelines which require strict compliance. More so, in view of the fact that the ratio of the judgment of this Court in M.M. Rajendran ....
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....er 'well informed'. Further, para 8.27 describes the process once such "source information" is developed and submitted to the superior officer. It reads as follows: 8.27. The source information once developed must be submitted in writing giving all available details with specific acts of omissions and commissions and copies of documents collected discreetly. The internal vigilance enquiries or departmental enquiry reports should normally not be used as basis for submitting the source information. The SP concerned after satisfying himself that there is prima facie material meriting action by CBI and further verification is likely to result in registration of a regular case, would order verification if it falls within his competence. In the cases which are within the competence of higher officers, he will forward his detailed comments to the DIG and obtain orders from superior officer competent to order registration. The verification of SIRs. must begin only after the competent authority has approved its registration. At this stage a regular SIR number will be assigned to the SIR which will also be entered in the source information sub-module of Crimes Module with all other....
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....vailable or after its secret verification reveals the commission of a cognizable offence, a Regular Case has to be registered instead of a Preliminary Enquiry being resorted to necessarily. 28. Paras 9.7-9.8 note that once it is decided that a Preliminary Enquiry is required, a "PE Registration Report" is required to be prepared. Para 9.10 specifies that in cases of corruption, the Preliminary Enquiry should be limited to a scrutiny of records and talking to the bare minimum persons. Para 9.11 notes that the records should be collected under a proper receipt memo (unlike the process of verification) and that the statements herein should be collected in the same manner as they would be at the investigation stage. However, it is clarified that notices Under Sections 91 and 160 of the Code of Criminal Procedure shall not be resorted to during a Preliminary Enquiry. Paras 9.12-9.14 then discuss the procedure for converting a Preliminary Enquiry into a Regular Case, which has to happen the moment sufficient material is available which discloses the commission of a cognizable offence which could result in result in prosecution. Finally, para 9.16 provides that a Preliminary Enquiry must....
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.... In case a cognizable offence is made out, the FIR has to be outrightly registered, and no preliminary inquiry has to be made as held in Lalita Kumari [Lalita Kumari v. State of U.P., (2014) 2 SCC 1: (2014) 1 SCC (Cri.) 524] by a Constitution Bench. There is no such provision in the Code of Criminal Procedure for preliminary inquiry or under the SC/ST Act, as such direction is impermissible. Moreover, it is ordered to be conducted by the person of the rank of DSP. The number of DSP as per stand of the Union of India required for such an exercise of preliminary inquiry is not available. The direction would mean that even if a complaint made out a cognizable offence, an FIR would not be registered until the preliminary inquiry is held. In case a preliminary inquiry concludes that allegations are false or motivated, FIR is not to be registered, in such a case how a final report has to be filed in the Court. Direction 79.4 cannot survive for the other reasons as it puts the members of the Scheduled Castes and Scheduled Tribes in a disadvantageous position in the matter of procedure vis-à-vis to the complaints lodged by members of upper caste, for latter no such preliminary inves....
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....rt noted that "[a]s a matter of fact, the accepted norm-be it in the form of CBI Manual or like instruments is to insist on a preliminary inquiry". The registration of a Regular Case can have disastrous consequences for the career of an officer, if the allegations ultimately turn out to be false. In a Preliminary Enquiry, the CBI is allowed access to documentary records and speak to persons just as they would in an investigation, which entails that information gathered can be used at the investigation stage as well. Hence, conducting a Preliminary Enquiry would not take away from the ultimate goal of prosecuting Accused persons in a timely manner. However, we once again clarify that if the CBI chooses not to hold a Preliminary Enquiry, the Accused cannot demand it as a matter of right. As clarified by this Court in Managipet (supra), the purpose of Lalita Kumari (supra) noting that a Preliminary Enquiry is valuable in corruption cases was not to vest a right in the Accused but to ensure that there is no abuse of the process of law in order to target public servants. E. Whether the FIR should be quashed E.1 Scope of review before the High Court 34. Having answered the first quest....
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....sed. (4) Where, the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated Under Section 155(2) of the Code. (5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the Accused. (6) Where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the concerned Act, providing efficacious redress for the grievance of the aggrieved party. (7) Where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the Accused and with a view to spite him due to private and personal grudge. 36. In a more recent decision of a three Judge Bench of this Court in Neeharika In....
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.... of activities and one ought not to tread over the other sphere; ix) The functions of the judiciary and the police are complementary, not overlapping; x) Save in exceptional cases where non-interference would result in miscarriage of justice, the Court and the judicial process should not interfere at the stage of investigation of offences; xi) Extraordinary and inherent powers of the Court do not confer an arbitrary jurisdiction on the Court to act according to its whims or caprice; xii) The first information report is not an encyclopedia which must disclose all facts and details relating to the offence reported. Therefore, when the investigation by the police is in progress, the court should not go into the merits of the allegations in the FIR. Police must be permitted to complete the investigation. It would be premature to pronounce the conclusion based on hazy facts that the complaint/FIR does not deserve to be investigated or that it amounts to abuse of process of law. After investigation, if the investigating officer finds that there is no substance in the application made by the complainant, the investigating officer may file an appropriate report/summary before the l....
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....82 Code of Criminal Procedure and/or Under Article 226 of the Constitution of India. xvii) Even in a case where the High Court is prima facie of the opinion that an exceptional case is made out for grant of interim stay of further investigation, after considering the broad parameters while exercising the powers Under Section 482 Code of Criminal Procedure and/or Under Article 226 of the Constitution of India referred to hereinabove, the High Court has to give brief reasons why such an interim order is warranted and/or is required to be passed so that it can demonstrate the application of mind by the Court and the higher forum can consider what was weighed with the High Court while passing such an interim order. xviii) Whenever an interim order is passed by the High Court of "no coercive steps to be adopted" within the aforesaid parameters, the High Court must clarify what does it mean by "no coercive steps to be adopted" as the term "no coercive steps to be adopted" can be said to be too vague and/or broad which can be misunderstood and/or misapplied. (emphasis supplied) 37. We must now assess whether the Single Judge of the Telangana High Court has, while quashing the FIR, d....
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....y which is not done. This circumstance, as submitted by the learned Senior Counsel for the Petitioners, would emphasize that the F.I.R. is registered in a hurry that too 'at Chennai, even without taking pains', to conduct preliminary enquiry to ascertain the truth and correctness of the figures of disproportionate assets mentioned in the F.I.R., because, the counter affidavit speaks that on the sole basis, of source information, directly F.I.R. is registered. This Court is unable to accept the correctness of the arguments advanced by the learned Standing Counsel for the Respondent that the correctness of such information will be verified by giving 'opportunity' to the Petitioners, during course of investigation. That means, the Respondents are accepting their mistake in not conducting preliminary enquiry. It is in the light of the above legal and factual issues, this Court is inclined to dwell upon the scrutiny of the irregularities pointed out by the Petitioners in the statements A to D of the F.I.R. to adjudicate upon the core issue whether the Respondents have prima facie material to conclude that the Petitioners are in possession of disproportionate assets. 3....
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....ting that the Appellant could not have determined the correct value of the property without conducting a Preliminary Enquiry before registering the FIR. Finally, in relation to this house, the Respondents also objected to the value of the elevator in the house being mentioned as 10 lakhs separately in Serial No. 31 of Statement-B of the FIR, when they believe it should have already been included within the valuation of the house constructed by them. The High Court held that the Appellant could not properly explain why this was included separately and directed for it to be struck off from Statement-B of the FIR, relying upon the letter dated 14 March 2016 by the first Respondent to Principal Chief Commissioner of Income Tax (CCA), Chennai in which the valuation report of the house was included. Thereafter, the High Court provided a summary of its conclusions in the form of the following table: I. The following values have to be included in the income of the petitioners shown in Statement-C. 1. Difference of Salary and arrears received by the 1st petitioner 37,67,242 2. Difference of Income of 2nd petitioner 70,35,286 3. Difference of sale consideration received by Sale of ....
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....e documents adduced by them. The reasons provided by the Single Judge for entering into the merits of the dispute while quashing the FIR are specious, especially so considering our finding that the CBI need not hold a Preliminary Enquiry mandatorily. While exercising its jurisdiction Under Article 226 of the Constitution to adjudicate on a petition seeking the quashing of an FIR, the High Court should have only considered whether the contents of the FIR-as they stand and on their face-prima facie make out a cognizable offence. However, it is evident that in a judgment spanning a hundred and seven pages (of the paper-book in this appeal) the Single Judge has conducted a mini-trial, overlooking binding principles which govern a plea for quashing an FIR. 41. The judgment of a two Judge Bench of this Court in Gunmala Sales (P) Ltd. v. Anu Mehta (2015) 1 SCC 103 makes it abundantly clear that the High Court does not conduct a mini-trial or a roving inquiry while exercising its powers Under Section 482 of the Code of Criminal Procedure. Justice Ranjana P. Desai held: 34.4. No restriction can be placed on the High Court's powers Under Section 482 of the Code. The High Court always ....
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.... with the provisions of any law, Rules or orders for the time being applicable to a public servant. 43. The ambit of the provision has been explained by a two Judge Bench of this Court in Kedari Lal (supra). Justice U U Lalit held thus: 10. The expression "known sources of income" in Section 13(1)(e) of the Act has two elements, first, the income must be received from a lawful source and secondly, the receipt of such income must have been intimated in accordance with the provisions of law, Rules or orders for the time being applicable to the public servant. In N. Ramakrishnaiah [N. Ramakrishnaiah v. State of A.P., (2008) 17 SCC 83: (2010) 4 SCC (Cri.) 454], while dealing with the said expression, it was observed: (SCC pp. 86-87, para 17) 17. '6. ... Qua the public servant, whatever return he gets from his service, will be the primary item of his income. [Other income which can conceivably be] income qua the public servant, will be in the regular receipt from (a) his property, or (b) his investment.' [Ed.: As observed in State of M.P. v. Awadh Kishore Gupta, (2004) 1 SCC 691 at p. 697: 2004 SCC (Cri.) 353, para 6.] The categories so enumerated are illustrative. Receip....
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..... We respectfully follow the said decisions. (emphasis supplied) 45. Further, the Respondents have also pointed out five infirmities in the FIR, the first four of which are based on the table reproduced in paragraph 10(ix)(b) of this judgment which notes that the value of the Respondents' Disproportionate Assets according to the FIR in the check period was Rs. 1,10,81,692. First, it has been pointed out that in Serial No. 6 and 7 of Statement-B of the FIR, the value of the first Respondents' constructed house is Rs. 5,15,50,000, while its actual value (according to the disclosures made by the Respondents in their Income Tax Returns) is Rs. 4,29,71,800. It has been argued that the value in the FIR is incorrect, by relying upon letter dated 14 March 2016 submitted by the first Respondent to Principal Chief Commissioner of Income Tax (CCA), Chennai where she has notified them of the construction of her house and attached a valuation report. According to this report, the total value of the house was Rs. 4,14,21,800. To this, an amount of Rs. 15,50,000 has been added to reach a final value of Rs. 4,29,71,800, which is Rs. 85,78,200 less than the value mentioned in the FIR. Fur....
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....o an excess of Respondents' income of Rs. 20,46,508 during the check period. Finally, it was also argued that the FIR has been filed solely relying upon "source information", which consists of documents seized by the CBI during the investigation of another case, which is unrelated to the present one. Further, the Respondents have also produced an order dated 28 February 2019 of the Principal Special Judge for CBI Cases (VIIIth Additional City Civil Court, Chennai) where this other case has been closed upon the submission of a closure report Under Section 173 of the Code of Criminal Procedure where it is noted that the FIR was closed due to "mistake of fact". 46. On the other hand, it has been argued on behalf of the Appellant that the documents relied upon by the Respondents are not unimpeachable and have to be proved at the stage of trial. Hence, it was urged that the arguments made on the basis of these documents should not be accepted by this Court. The Appellant has relied upon the judgment of a two Judge Bench of this Court in J. Jayalalitha (supra), where it has been held that documents such as Income Tax Returns cannot be relied upon as conclusive proof to show that the....
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.... Article 32 of the Constitution of India seeking an appropriate writ for directing the Union of India to take appropriate action to prosecute R-2 to R-5 under the 1988 Act for having amassed assets disproportionate to the known sources of income by misusing their power and authority. The Respondents were the then sitting Chief Minister of U.P. and his relatives. Having noticed that the basic issue was with regard to alleged investments and sources of such investments, Respondents 2 to 5 were ordered by this Court to file copies of income tax and wealth tax returns of the relevant assessment years which was done. It was pointed out on behalf of the Petitioner that the net assets of the family though were Rs. 9,22,72,000, as per the calculation made by the official valuer, the then value of the net assets came to be Rs. 24 crores. It was pleaded on behalf of the Respondents that income tax returns had already been filed and the matters were pending before the authorities concerned and all the payments were made by cheques, and thus the allegation levelled against them were baseless. It was observed that the minuteness of the details furnished by the parties and the income tax returns....
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.... were seized during four raids conducted at the residences of the first Respondent, and she herself was also examined in that case. It has been submitted that the documents which gave rise to the "source information" were seized during the raids conducted at the first Respondent's residences in Secunderabad on 27 June 2016 and in Jubilee Hills, Hyderabad on 8 July 2016. Hence, the fact that the other case during whose investigation these documents were seized has now been closed does not affect the FIR in the present case, since the charges against the first Respondent are entirely different. 48. At the very outset, we must categorically hold that the documents which have been relied upon by the Respondents cannot form the basis of quashing the FIR. The value and weight to be ascribed to the documents is a matter of trial. Both the parties have cited previous decisions of two Judge Benches of this Court in order to support their submissions. There is no clash between the decisions in Kedari Lal (supra) and J. Jayalalitha (supra) for two reasons: (i) the judgment in J. Jayalalitha (supra) notes that a document like the Income Tax Return, by itself, would not be definitive evide....