J. U. PRABHU v. UNION OF INDIA — 1983 DIGILAW 141 (KAR)

M. RAMA JOIS, J. ( 1 ) THE petitioner, a Dy. General Manager of the Syndicate Bank, has presented this writ petition praying for quashing the two first information reports dt. 19-2-1983 (Annexure-A) and 23-3-1983 (Annexure-C) and also for a direction to the respondents restraining them from conducting investigation on the basis of the information contained in Annexures A and C. The petitioner has also prayed for issue of a direction to the respondents to return all the properties and documents taken possession of by the respondents during investigation. ( 2 ) THE facts of the case, in brief, are as follows : (I) The petitioner joined service in the year 1959 on the establishment of the then canara Industrial and Banking Syndicate ltd. The said Bank was acquired under the provisions of the Banking Companies (Anquisition and Transfer of Undertakings) act, 1970. After the acquisition of the bank, it came to be named as 'syndicate bank'. In view of the acquisition of the bank by the Government, it also became a public body and fell within the definition of the word 'state' as defined in Art. 12 of the Constitution. The petitioner also became a public servant. (ii) On 19-2-1983 a first information report (Annexure-A) signed by the Police inspector of the Central Bureau of Intelligence, Bangalore, was sent to the Prl. City Civil and Sessions Judge, Bangalore (the Spl. Judge for SPE cases), alleging commission of offence under Ss. 5 (2) and 5 (1) (e)of the Prevention of Corruption act ('the Act' for short ). A second report was sent on 23-3-1983 (Annexure-C ). The contents of boih the reports are almost identical. The investigation has been undertaken in respect of the offence alleged against the petitioner. In this writ petition, the petitioner prays for restraining the respondents from conducting any investigation pursuant to the two first information reports. ( 3 ) SRI N. B. Bhat, learned counsel for the petitioner urged the following contention : the first information reports do not disclose all the ingredients of the offence under S. 5 (1) (e) of the Act and, therefore, the respondents had no legal authority to conduct the investigation in respect of the charge under S. 5 (1) (e) of the Act alleged against the petitioner. ( 4 ) ELABORATING the above cohtention, learned counsel for the petitioner submitted as follows : The existence of a first information report, in which all the ingredients of the offence are disclosed constitute the very basis and foundation for the exercise of powers of investigation under the provisions of the Criminal Procedure code ('the Code' for short ). In the present case, the offence alleged against the petitioner is S. 5 (1) (e) of the Act. According to the said section, the essential ingredients of the offence are- (i) Possession of assets by a public servant which is disproportionate to the known sources of income of the public servant; and (ii) the public servant has no satisfactory explanation in respect of the disproportionate assets possessed by him. Both the first information reports do not disclose the essential ingredients, in that while the known sources of income of the petitioner has been given and the value of the assets said to be in the possession of the petitioner has been set out, there is no allegation or statement to the effect that the petitioner had no satisfactory explanation for the assets in his possession. In the absence of specification of that essential ingredient, the first information report cannot be regarded as having disclosed an offence and consequently the respondents had no legal authority to conduct investigation. ( 5 ) IN support of the contention, learned counsel for the petitioner relied in the judgment of the Supreme Court in State of w. B. v. Swarankumar (1 ). In particular he relied on paras 10 and 21 of the judgment and contended that the police had no power to commence and conduct investigation under S. 157 of the Code as their power to investigate depends on the existence of reason to suspect the commission of a cognizable offence and they could not reasonably suspect that an offence had been committed by an individual unless the first information report prima facie disclosed all the essential ingredients of the offence and as this condition was not fulfilled by the two first information reports filed against the petitioner, the respondents had no legal authority to cany on the investigation. ( 6 ) SHRI Shivashankar Bhat, learned Sr. Standing counsel for the Central Government-respondent 1, Sri Padmarajaiah, learned Jr. ( 6 ) SHRI Shivashankar Bhat, learned Sr. Standing counsel for the Central Government-respondent 1, Sri Padmarajaiah, learned Jr. Standing counsel for the Central Government, for respondent 2 and Sri s. V. Jagannath, learned High Court government Advocate were requested to assist the Court and addressed arguments opposing the contention of the petitioner. ( 7 ) THEIR submissions may be summarised as follows: (I) The first information reports, in the present case, set out all the essential ingredients of the offence under S. 5 (1) (e) of the Act, in that they give full information about the total income of the petitioner from all known sources and also the value of his assets and set out the extent of disproportionate assets in his possession. (ii) The other ingredient, namely, that the petitioner cannot satisfactorily account in respect of the disproportionate assets in his possession, is not an essential ingredient of the offence which has to be expressly stated in the first information report, as that is an inference or presumption flowing from possession of assets disproportionate to all the known sources of his income. (iii) Even if it is regarded as an essential ingredient, in the very factual statement that after collecting information about all known sources of income, the assets in the possession of the petitioner is highly disproportionate to his income, it is implicit that the petitioner cannot satisfactorily account for the possession of such assets. The relevant portion of the judgment in swaran Kumar's (1) case are as follows : his Lordship Justice A. N. Sen said thus : "65. Whether an offence has been disclosed or not must necessarily depend on the facts and circumstances of each particular case. In considering whether an offence into which an investigation is made or to be made is disclosed or not, the Court has mainly to take into consideration the complaint or the FIR and the Court may in appropriate cases take into consideration the relevant facts and circumstances of the case. On a consideration of all the relevant materials, the Court has to come to the conclusion whether an offence is disclosed, the court will normally not interfere with the investigation into the offence and will generally allow the investigation into the offence to be completed for collecting materials for proving the offence. On a consideration of all the relevant materials, the Court has to come to the conclusion whether an offence is disclosed, the court will normally not interfere with the investigation into the offence and will generally allow the investigation into the offence to be completed for collecting materials for proving the offence. If, on the other hand, the Court on a consideration of the relevant materials is satisfied that no offence is disclosed, it will be the duty of the Court to interfere with any kind of uncalled for and unnecessary harassment to an individual", (underlined (italics) by me)HIS Lordship the Chief Justice having expressed his full concurrence to the view expressed by Sen, J. (vide para 1) added :"10. The question as to whether the first information report prima facie discloses an offence under S. 4 read with s. 3 of the Act has to be decided in the light of these requirements of S. 2 (c) of the Act. I have already reproduced in extenso the FIR lodged by the Commercial tax Officer, Bureau of Investigation. Analysing it carefully, and even liberally, it makes the following allegations against the firm 'sanchita Investments' and its three partners : (1) The firm had offered fabulous interest @ 48% per annum to its members, which rate of interest was later reduced to 36% per annum ; (2) Such high rate of interest was being paid even though the loan certificate receipts show that interest was liable to be paid at the rate of 12% per annum only; and (3) The fact that interest was paid in excess of 12% shows clearly that a 'money Circulation Scheme' was being promoted and conducted for the making of quick or easy money. It seems to me impossible to hold on the basis of these allegations that any offence can be said to be made out prima facie under S. 3 of the Act. In the first place, the FIR does not allege, directly or indirectly, that the firm was promoting or conducting a scheme for the making of quick or easy money, dependent on any event or contingency relative or applicable to the enrolment of members into the scheme. In the first place, the FIR does not allege, directly or indirectly, that the firm was promoting or conducting a scheme for the making of quick or easy money, dependent on any event or contingency relative or applicable to the enrolment of members into the scheme. Secondly, the fir does not contain any allegation whatsoever that persons who advanced or deposited their monies with the firm were participants of a scheme for the making of quick or easy money, dependent upon any such event or contingency. The FIR bears on its face the stamp of hurry and want of care. It seems to assume, what was argued before us by Sri Som Nath Chatterje on behalf of the prosecution, that it is enough for purposes of S. 2 (c) to show that the accused is promoting or conducting a scheme for the making of quick or easy money, an assumption which I have shown to be fallacious. An essential ingredient of S. 2 (c) is that the scheme for making quick or easy money must be dependent on any event or contingency relative or applicable to the enrolment of members into the scheme. A first information report which does not allege or disclose that the essential requirements of the penal provision are prima facie satisfied, cannot be the foundation or constitute the starting point of a lawful investigation". "21. The position which emerges from these decisions and the other decisions which are discussed by my learned brother a. N. Sen is that the condition precedent to the commencement of investigation under s. 157 of the. Code is that the FIR must disclose, prima facie, that a cognizable offence has been committed. It is wrong to suppose that the police have an unfettered discretion to commence investigation under S. 157 of the Code. Their right of inquiry is conditioned by the existence of reason to suspect the commission of a cognizable offence and they cannot, reasonably, have reason so to suspect unless the FIR prima facie, discloses the commission of such offence. If that condition is satisfied, the investigation must go on and the rule in Khwaja nazir Ahmed will apply. The Court has then no power to stop the investigation, for to do so would be to trench upon the lawful power of the police to investigate into a cognizable offence. If that condition is satisfied, the investigation must go on and the rule in Khwaja nazir Ahmed will apply. The Court has then no power to stop the investigation, for to do so would be to trench upon the lawful power of the police to investigate into a cognizable offence. On the other hand, if the FIR does not disclose the commission of a cognizable offence, the Court would be justified in quashing the investigation on the basis of the information as laid or received", (underlined (italics) by me) ( 8 ) IN the light of the ratio laid down as above and the submission made by the learned counsel, the following two questions arise for consideration ; (I) Whether the fact that a public servant cannot satisfactorily account for his assets disproportionate to his known sources of income is an essential ingredient which must find a place in the first- information report and in its absence whether there is no power to investigate ? If it is so whether the FIRs in this case do not impliedly 'disclose that ingredient also ? (ii) Even if a statement that the concerned public servant cannot satisfactorily account for his assets disproportionate to his known source of income, is not expressly or impliedly disclosed in the first information report, if there are other material information in the possession of the police which furnishes the basis to suspect the commission of the offence, whether they have the power to investigate even if the material disclosed in the first information report is not sufficient to indicate the commission of the offence. I shall at this stage, set out the contents of S. 5 (1) (e)of the Act. It reads:"5. Criminal misconduct in discharge of offcial duty :- (1) A public servant is said to commit the offence of criminal misconduct. . . . . . . . . . (e) if he, or any person on his behalf is in possession of or has, at any time during the period of his office, been in possession, for which the public servant cannot satisfactorily account, of pecuniary resources or property disproportionate to his income", (underlined (italics) by me)THIS provision has been interpreted by the Supreme Court in State of Maharashtra v. Wasudeo Ramachandra (2 ). ". . . . ". . . . The ingredients of the offence of criminal misconduct under S. 5 (2) read with S. 5 (1) (e) are, the possession of pecuniary resources or property disproportionate to the known sources of income for which the public servant cannot satisfactorily account. To substantiate the charge, the prosecution must prove the following facts before it can bring a case under S. 5 (1) (e), namely, (1) it must establish that the accused is a public servant, (2) the nature and extent of the pecuniary resources or property were found in his possession, (3) it must be proved as to what were his known sources of income i. e. , known to the prosecution, and (4) it must prove, quite objectively, that such resources or property found in the possession of the accused were disproportionate to his known sources of income. Once these four ingredients are established, the offence of criminal misconduct under S. 5 (1) (e) is complete, unless the accused is able to account for such resources or property. The burden then shifts to the accused to satisfactorily account for his possession of disproportionate assets. The extent and nature of burden of proot resting upon the public servant found to be in possession of disproportionate assets under S. 5 (1) (e) cannot be higher than the test laid by the Court in Jhagan's care ( AIR 1966 SC 1762 ) i. e. , to establish his case by a preponderance of probability. That test was laid down by the Court following the dictum of Viscount Sankey, L. C. in Woolmington v. Director of Public Prosecutions, (1935) ac 462. The High Court has placed an impossible burden on the prosecution to disprove all possible sources of income which were within the special knowledge of the accused. As laid down in swamy's case ( AIR 1960 SC 7 ), the prosecution cannot, in the very nature of things, be expected to know the affairs of a public servant found in possession of resources or property disproportionate to his known sources of income, i. e. , his salary. Those will be matters specially within the knowledge of the public 'servant within the meaning of S. 106 of the Evidence Act, 1872. S. 106 reads. Those will be matters specially within the knowledge of the public 'servant within the meaning of S. 106 of the Evidence Act, 1872. S. 106 reads. x x x x "in this connection, the phrase the burden of proof is clearly used in the secondary sense, namely, the duty of introducing evidence. The nature and extent of the burden cast on the accused is well settled. The accused is not bound to prove his innocence beyond all reasonable doubt. All that he need do is to bring out a preponderance of probability". According to the above enunciation, the ingredients of the offence under S. 5 (1) (e) of the Act which the police are required to prove are- (1) That the accused is a public servant. (2) The nature and extent of the pecuniary resources or property found in his possession ; (3) His known sources of income i. e. known to the prosecution ; and (4) That such resources or property found in the possession of the accused were disproportionate to his known sources of income. The want of satisfactory explanation on the part of the accused public servant concerned is required to be proved by him and not the police. It is a defence open to the public servant concerned after the four essential ingredients are established by the police. As pointed out by the supreme Court, it is a matter within the special knowledge of the accused public servant and it follows, non-mentioning of that fact cannot and does not render the first information report defective so as to constitute no basis for investigation. ( 9 ) THE next point for consideration is whether the first information reports in this case disclose the four essential ingredients. As stated earlier in this case, there are two first information reports, both of them are almost identical. Therefore, it is sufficient to set out the contents of the latest first information report dt. 23-3-1983 (Annexure-C ). It reads : office of the Supdt. of Police, cbi, SPE CIU Loknayak Bhavan, 8th Floor, Khan Market, B'lore. Delhi Spl. Police Establishment CIU (I) branch first Information Report crime No. RC 2/83 CIR (I) date and time of report 23-3-83 at 4 PM. Place of occurrence with State:-Bangalore, Karnataka. Date and time of occurrence :-Between 1959 and 1982. It reads : office of the Supdt. of Police, cbi, SPE CIU Loknayak Bhavan, 8th Floor, Khan Market, B'lore. Delhi Spl. Police Establishment CIU (I) branch first Information Report crime No. RC 2/83 CIR (I) date and time of report 23-3-83 at 4 PM. Place of occurrence with State:-Bangalore, Karnataka. Date and time of occurrence :-Between 1959 and 1982. Name of complainant or information with address :-Sri S. V. Shashidhar, police Inspector, CBI, SPE, Bangalore. Offence :-U/s. 5 (2) r/w S. 5 (1) (c) of pc Act (Act II of 1947 ). Name and address of the accused :-Sri j. U. Prabhu, Dy. General Manager, zonal Office, Syndicate Bank, Gandhinagar, Bangalore. Action taken :-An R. C. Registered. Investigation Officer :- Sri Om Prakash, dy. Supdt. of Police, CBI SPE CIU (I), new Delhi. Information under the orders of Head Office, the case RC 4/83 dt. 19-8-83 of Bangalore branch of SPE is re-registered in CIU (I) branch of SPE CBI on transfer. The information contained in RC 4/83 of bangalore branch of SPE is reproduced below :"credible information has been received to the following effect : sri J. U. Prabhu is working as Dy. Gen. Manager, Syndicate Bank, Gandhinagar, bangalore. He joined the Bank on 27-8-1959 as probationery officer on a salary of Rs. 300 per month. His in come by way of salary and other known sources is to the extent of about Rs. 6,65,834 during the said period. His probable expenditure is the extent of about Rs. 3,90,887-14 ps. His likely savings thereby is the extent of about rs. 2,14,937-73 ps. But the total assets are to the extent of about Rs. 7,00,480-18 pj. in the form of a house at No. 132/a3, Seshadripuram, I Main Road, bangalore-20, a site measuring 50'x80' in West of Chord Road taken in the name of his daughter, a site in Koramangala lay-out, a site at Hyderabad, fds, in his own name and in the names of the members of his family to the the extent of about Rs, 1,07,500, Bank deposits, share certificates and other household items such as T. V. , Refrigerator, car, Jewellery etc. Thus his assets are disproportionate to his known sources of income to the extent of about Rs. 4,84,542 aud this he could not have acquired without resorting to corrupt or illegal means by abusing his official position. Thus his assets are disproportionate to his known sources of income to the extent of about Rs. 4,84,542 aud this he could not have acquired without resorting to corrupt or illegal means by abusing his official position. The above information discloses an offence U/s. 5 (2) r/w 5 (1) (c) of Prevention of Corruption Act (Act II of 1947 ). Hence the FIR. Sd/- (S. V. Shashidhar) police Inspector, CBI SPE, Bangalore. The investigation of this case is entrusted to Sri Om Prakash, Dy. SP ciu (I) SPE CBI. New Delhi. Sd/- Vijay Shankar. Supdt. of Police, CIU (I) SPE CBI, new Delhi". The information disclosed from the report are- (i) The petitioner is a public servant being an officer of the Syndicate Bank and this fact is not disputed by the petitioner. (ii) The amount of his income by way of salary and other known sources of income including his probable expenditure during the period is set out. (iii) The properties possessed by him in his name or in the names of members of his family and the value of those assets have been set out. (iv) The extent of disproportionate assets possessed by the petitioner has also been set out. Thus all the four essential ingredients of the offence of S. 5 (1) (e) of the Act which the police are required to prove as pointed out by the Supreme Court in the case of wasudeo Ramachandra (2) are found in the first information report. It can therefore constitute the basis for investigation. I find it difficult to accept the contention urged for the petitioner that as the first information report does not specifically set out the fifth ingredient of the offence under s. 5 (1) (e) of the Act, namely, that the petitioner cannot satisfactorily account for his disproportinate assets, it cannot constitute the basis for commencement of investigation of the offence against him under S. 157 of the Code. ( 10 ) APART from this, even taking that the fact that the public servant cannot satisfactorily account is also an essential ingredient (the fifth ingredient) of the offence to be set out in the first information report, it appears to me that it is an inference or presumption arising from the four essential ingredients set out above. ( 10 ) APART from this, even taking that the fact that the public servant cannot satisfactorily account is also an essential ingredient (the fifth ingredient) of the offence to be set out in the first information report, it appears to me that it is an inference or presumption arising from the four essential ingredients set out above. This is evident from the wording of the section, namely "for which the public servant cannot satisfactorily account", which means that in the opinion of the police, the public servant concerned cannot satisfactorily account for the possession of disportionate assets and not that the public servant was asked by the police to satisfactorily account for the same and he failed to do so. Therefore, if the four ingredients are set out, the fifth is a presumption or inference which flows from them and which can be rebutted or dislodged by a public servant before the Court after the four ingredients are proved by the police. In this behalf, the following words in the first information report are relevant-"his income by way of salary and other known sources is to the extent of. . . . . . . . "the above statement clearly indicates that before filing the first information report in the course of preliminary inquiry, not only the income of the petitioner by way of salary, but also the information in respect of all other known sources of his income was ascertained and the total income so disclosed was to the extent of Rs. 6,65,834 during the period in question and after deducting the probable expenses of the petitioner during the period, the disproportionate assets found in the possession of or on behalf of the petitioner according to the police are valued at Rs. 4,85,542. Thus when information had been collected of the salary and all other known sources of income of the petitioner and even then the assets in the possession of the petitioner or on his behalf were found to be highly disproportioate to such income, prima facie, it means, the petitioner cannot satisfactorily account for the possession of such assets. 4,85,542. Thus when information had been collected of the salary and all other known sources of income of the petitioner and even then the assets in the possession of the petitioner or on his behalf were found to be highly disproportioate to such income, prima facie, it means, the petitioner cannot satisfactorily account for the possession of such assets. Of course, if the income of the petitioner from salary alone had been taken and no information about his income from other sources had been collected, or it was not stated that he bad no other source of income, it would have been possible for the petitioner to contend that the first information report is incomplete and does not disclose the ingredients of the offence under S. 5 (1) (e) of the Act. But in the first-information report in this case, all known sources of income of the petitioner and his probable expenditure are furnished and on that basis the extent of disproportionate assets in his possession is computed. Thus the first information report expressly sets out the four essential ingredients of the offence under S. 5 (1) (e) of the Act required to be proved by the police, and the fifth ingredient, viz. that the petitioner cannot satisfactorily account for his assets disproportionate to his all known sources of income is implicit in the first information report. In the circumstances, i do not find any substance in the contention urged for the petitioner. ( 11 ) THE second question is whether even if the first information report does not disclose the ingredients of the offence, whether the police has the power to investigate if they are in possession of information otherwise than on first information report which gives them the reasonable basis to suspect the commission of an offence. On this aspect of the matter, learned counsel for the petitioner contended, that in the absence of essential ingredients disclosed in the first information report, there is no power to investigate and in support of this he submitted that the enunciation of the law on this point, is clear and unambiguous in paras 10 and 21 of the judgment of the Chief Justice in swaran Kumar's (1) case. ( 12 ) LEARNED counsel for the respondents, however, submitted that a reading of para 65 of the judgment of Sen, J. in swaran Kumar's (1) case with which the chief Justice had expressed his agreement in full, would show that investigation by the police is legitimate if other materials other than or in addition to the first information report was available, so as to reasonably suspect the commission of an offence. Learned counsel submitted that in the case of the first information report in swaran Kumar's (1) case, the Supreme court found that the officer, who filed the first information report had not understood the scope of the offence under S. 3 of the Prize Chits and Money Circulation schemes (Banning) Act, 1978, at all and as a result the first information report did not disclose the offence and further there was no other material forming the basis for suspecting the commission of the offence and it is in these circumstances the Supreme Court held that the investigation in that case was without authority of law and that the decision was no authority for an absolute proposition that if the first information report does not disclose the ingredients of the offence even if there were other material to suspect the commission of the offence, the police have no power to investigate. They maintained that even in the absence of a first information report, if the police have got sufficient information to suspect the commission of any offence by an individual, they have the power to investigate. In support of the submission, learned counsel relied on the language of S. 157 of the Code itself. It reads :"157. (1) If, from information received or otherwise, an officer in charge of a police station has reason to suspect the commission of an offence which he is empowered under S. 156 to investigate, he shall forthwith send a report of the same to a Magistrate empowered to take cognizance of such offence upon a police report and shall proceed in person, or shall depute one of his subordinate officers not being below such rank as the State Government may, by general or special order, prescribe in this behalf, to proceed, to the spot, to investigate the facts and circumstances of the case, and, if necessary to take measures for the discovery and arrest of the offender. (Underlined (italics) by me) learned counsel stressed on the word 'otherwise' in the section and relied on the judgment of the Supreme Court in state of U. P. v. Bhagwant Kishore (3 ). The relevant portion of the judgment reads : ". . . . Though ordinarily investigation is undertaken on information received by a police officer, the receipt of information is not a condition precedent for investigation. S. 157 prescribes the procedure in the matter of such an investigation which can be initiated either on information or otherwise. It is clear from the said provisions that an officer in charge of a police station can start investigation either on information or otherwise". (Underlined (italics) by me)LEARNED counsel pointed out that the above judgment was reiterated by the supreme Court in Apren Joseph v. State of kerala (4 ). Relying on the said decisions, learned counsel argued that if the police are in possession of information which reasonably constitutes the basis for suspecting the commission of an offence, they have the authority to investigate notwithstanding the fact that the first information report is incomplete or defective. ( 13 ) THERE is considerable force in the submission made by the learned counsel for the respondents. However, it is unnecessary for me to examine the same in greater detail and express final opinion for the reason that in the present case I have come to conclusion that the first information report contains all the ingredients of the offence and, therefore, the investigation is in accordance with law. ( 14 ) LEARNED counsel for the petitioner urged another contention, namely, that an offence under S. 5 (1) (e) of the Act could be investigated only by an officer above the rank of Dy. Superintendent of Police and an officer of the rank specified in S. 5 A (1) of the Act could conduct the investigation only if he was authorised by an order of the Superintendent of Police and no such authorisation is disclosed in the earlier first information report. ( 15 ) IT is true that in view of the second proviso to S. 5-A (1) of the Act, an offence under S. 5 (1) (e) of the Act against a public servant can be investigated by an officer of the rank of Superintendent of Police and above and by the dy. ( 15 ) IT is true that in view of the second proviso to S. 5-A (1) of the Act, an offence under S. 5 (1) (e) of the Act against a public servant can be investigated by an officer of the rank of Superintendent of Police and above and by the dy. Superintendent of Police if only he is authorised by an order of the Superintendent of Police. It is true that the earlier first information report (Annexure-A) does not indicate whether the investigation was entrusted to an officer who was competent to investigate, by the Superintendent of Police. But the question is" academic as in the second first information report (Annexure-C), the contents of which are earlier extracted, the Deputy superintendent of Police has been- specifically authorised by an order of the superintendent of Police to investigate. In view of this, the contention does not survive. ( 16 ) IN the result, I find no merit in the petition and make the following order : (i) Petition dismissed. (ii) No costs. Standing counsel for Central Government are permitted to file memo of appearance for respondents 1 and 2 within two weeks. --- *** --- .