# a.s.~ v. A.R AtmJlAY & ANL APRIL 17 • 1986

- **Citation:** [1986] 2 S.C.R. 621
- **Court:** Supreme Court of India
- **Decided:** 1986
- **Case number:** Criminal Appeal No. 658 of 1985
- **Bench:** P. N. Bhagwati, Ranganath Misra
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/a-s-v-a-r-atmjlay-anl-april-17-1986-9273
- **Pages:** 79

## Headnote

~
Criminal Procedure Code, 1973
Sections 245( 1) and 246 - Whether a charge should be
framed against the accused or not - Test of 'prima facie' case
to be applied.
Sections 227, 239 and 245- Comparison between.
Indian Penal Code, 1860
Sections 161 and 165 - Scope and differenCE! between -
Motive or reward for abuse of office - Relevancy of.
A
B
c
D
Sections
415
and
420
-
Ingredients
of
Cheating
explained.
r ~
E
Sections 383 and 384 - "extortionn - Ingredients of.
Prevention of Corruption Act, 1947, s. 4 -Presumption
raised under s. 4 is a presumption of law - It will have to be
.....
drawn against an accused once acceptance of a valuable thing
-_, by him is proved.
~
The respondent was at the relevant time Chief Minister
of the State of MSharashtra. The appellant lodged a complaint
on August 9, 1982 alleging comssion of offences by the
respondent punishable under ss. 161, 165, 384 and 420 read
with s. 120B, Indian Penal Ccie as also s. 5(2) read with s.
S(l)(d) of the Prevention of Corruption Act. It was alleged in
the complaint that the respondent, as the Chief Minister of
~ the State, had created seven Trusts, one of them being Indira
' 4 Gandhi Pratishthan shown to be a Government Trust and that he
extended favours to those who JUde donations to the said
trusts. In all the trusts, except the Indira Gandhi Pratibha
Pratishthan, the respondent, his wife, close relations and
friends were associated as trustees.
F
G
H
A
B
c
D
E
F
G
H
622
SUPREME COURT REPORTS
[ 1986 J 2 S.C. R.
The complaint was registered as Special Case No. 24/82.
and was transferred to the High Court of Bombay for trial"
under an order of this Court dated Feb. 16, 1984. Fifty-seven
witnesses for prosecution were examined before the Trial Judge
and 43 draft charges were placed for his consideration. The
prosecution examdned specific witnesses with reference to the
allegations supporting the draft charges and documents were
also produced to support the allegations. The Trial Judge
framed 21 charges against the respondent and discharged him i~~
respect of the remaining 22 charges relating to the offence of
cheating, extortion and conspira~y.
The appellant, aggrieved by the order refusing to frame
charges on 22 heads b:f the Trial Judge, filed the present -YCriminal Appeal by Special Leave.
Allowing the appeal in part,
HELD : (By the Court) 1.1 A prima facie case has been
established by the prosecution in respect of the allegations
for charges under ss. 120B, 161 and 165 and 420, IPC, as also
under s. 5(1) read with s. 5(2) of the Act. So far as the
three draft charges relating to the offence punishable under
s. 384, IPC are concerned, the learned Trial Judge was right A_"'
in holding that the prosecution failed to make out a prima
facie case. Therefore, except in regard to the three draft
charges under s. 384, IPC, charges in respect of the remaining
!9 items shall be framed. The appeal is allowed to that
extent. [696 D-F}
-r-'"
1.2 It is still open to the Trial Judge to consider on (
the material available, if anyone has to be proceeded against~
1..
as a co-conspirator when the charge of conspiracy punishable
under s. 120-B, !PC is framed. Under s. 319 of the Code de
novo trial would be necessary, but it is in the discretion of
the Trial Court to take a decision as to whether keeping all
aspects in view any other person should be brought in as an
accused to be tried for any of the offences involved in the
case. This is a matter in the discretion of the trial court.
[697 F-H]
~
Per Rauganatb Misra, J. (Bhagwati, C.J. Concurring)
2.1
The
Code
of
Criminal
Procedure
contemplates
,
·•
R.S. NAYAK v. A.R. ANTULAY
623
discharge of the accused by the Court of Sessions under s. 227
~ in a case triable by it, cases instituted upon a police report
are covered by s. 239 and cases instituted otherwise than on
police report are dealt with in s. 245. The three sections
contain somewhat different provisions in regard to discharge
of the accused. Under s. 227, the trial Judge

## Text

_Characters 0–39,836 of 183,067. This is a partial read: ask again with offset=39836 for what follows._

621
a.s.~
v.
A.R.. AtmJlAY & ANL
APRIL 17 • 1986
[ P. N. BHAGWATI, C. J. AND RANGANATH MISRA, J .]
~
Criminal Procedure Code, 1973
Sections 245( 1) and 246 - Whether a charge should be
framed against the accused or not - Test of 'prima facie' case
to be applied.
Sections 227, 239 and 245- Comparison between.
Indian Penal Code, 1860
Sections 161 and 165 - Scope and differenCE! between -
Motive or reward for abuse of office - Relevancy of.
A
B
c
D
Sections
415
and
420
-
Ingredients
of
Cheating
explained.
r ~
E
Sections 383 and 384 - "extortionn - Ingredients of.
Prevention of Corruption Act, 1947, s. 4 -Presumption
raised under s. 4 is a presumption of law - It will have to be
.....
drawn against an accused once acceptance of a valuable thing
-_, by him is proved.
~
The respondent was at the relevant time Chief Minister
of the State of MSharashtra. The appellant lodged a complaint
on August 9, 1982 alleging comssion of offences by the
respondent punishable under ss. 161, 165, 384 and 420 read
with s. 120B, Indian Penal Ccie as also s. 5(2) read with s.
S(l)(d) of the Prevention of Corruption Act. It was alleged in
the complaint that the respondent, as the Chief Minister of
~ the State, had created seven Trusts, one of them being Indira
' 4 Gandhi Pratishthan shown to be a Government Trust and that he
extended favours to those who JUde donations to the said
trusts. In all the trusts, except the Indira Gandhi Pratibha
Pratishthan, the respondent, his wife, close relations and
friends were associated as trustees.
F
G
H
A
B
c
D
E
F
G
H
622
SUPREME COURT REPORTS
[ 1986 J 2 S.C. R.
The complaint was registered as Special Case No. 24/82.
and was transferred to the High Court of Bombay for trial"
under an order of this Court dated Feb. 16, 1984. Fifty-seven
witnesses for prosecution were examined before the Trial Judge
and 43 draft charges were placed for his consideration. The
prosecution examdned specific witnesses with reference to the
allegations supporting the draft charges and documents were
also produced to support the allegations. The Trial Judge
framed 21 charges against the respondent and discharged him i~~
respect of the remaining 22 charges relating to the offence of
cheating, extortion and conspira~y.
The appellant, aggrieved by the order refusing to frame
charges on 22 heads b:f the Trial Judge, filed the present -YCriminal Appeal by Special Leave.
Allowing the appeal in part,
HELD : (By the Court) 1.1 A prima facie case has been
established by the prosecution in respect of the allegations
for charges under ss. 120B, 161 and 165 and 420, IPC, as also
under s. 5(1) read with s. 5(2) of the Act. So far as the
three draft charges relating to the offence punishable under
s. 384, IPC are concerned, the learned Trial Judge was right A_"'
in holding that the prosecution failed to make out a prima
facie case. Therefore, except in regard to the three draft
charges under s. 384, IPC, charges in respect of the remaining
!9 items shall be framed. The appeal is allowed to that
extent. [696 D-F}
-r-'"
1.2 It is still open to the Trial Judge to consider on (
the material available, if anyone has to be proceeded against~
1..
as a co-conspirator when the charge of conspiracy punishable
under s. 120-B, !PC is framed. Under s. 319 of the Code de
novo trial would be necessary, but it is in the discretion of
the Trial Court to take a decision as to whether keeping all
aspects in view any other person should be brought in as an
accused to be tried for any of the offences involved in the
case. This is a matter in the discretion of the trial court.
[697 F-H]
~
Per Rauganatb Misra, J. (Bhagwati, C.J. Concurring)
2.1
The
Code
of
Criminal
Procedure
contemplates
,
·•
R.S. NAYAK v. A.R. ANTULAY
623
discharge of the accused by the Court of Sessions under s. 227
~ in a case triable by it, cases instituted upon a police report
are covered by s. 239 and cases instituted otherwise than on
police report are dealt with in s. 245. The three sections
contain somewhat different provisions in regard to discharge
of the accused. Under s. 227, the trial Judge is required to
discharge the accused if he "considers that there is no
sufficient ground for proceeding against
the accused.
11
Obligation to discharge the accus~d under s. 239 arises when
~"the Magistrate considers the charge against the accused to be
groundless." The power to discharge is exercisable under s.
245(1) when "the Magistrate considers for reasons to be
recorded, that no case against the accused has been made out
._
which, if unrebutted, would warrant his conviction." [677 B-E]
'1
-
-
2.2 Sections 227 and 239 provide for discharge being
~- ordered before the recording of evidence and the consideration
as to whether charge has to be framed or not is required to be
Mde on the basis of the record of the case, including
documents and oral hearing of the accused and the prosecution
or the police report, the doctllll!nts sent along with it and
examination of the accused and after affording an opportunity
to the two parties to be heard. The stage for discharge under
~ ~ s. 245, on the other hand, is reached only after the evidence
referred to in s. 244 has been taken. Notwithkqtanding this
difference in the position there is no scope for doubt that
the stage at which the Magistrate is required to consider the
question of fraaing of charge under s. 245(1) is a preliminary
one and that the test of "prima facie" case has to be applied.
-...,. In spite of the difference in the language of the three
sections, the legal position is that if the Trial Court is
t- satisfied that a prima facie case is made oqt, charge has to
· be framed. Therefore, in order to decide Whether the order of
discharge should be sustained or set aside, the Supreme Court
has to consider whether on the material on record, a prima
facie case has been made out on behalf of the prosecution.
[677 E-{;]
Mebant Abbey Dass v. S. Gurdia1. Singh & Ors. , A. I. R.
~ 1971 s.c. 834; State of Bihar v. Rawesb Siugb, (i978] 1 s.c.~
257; lfimal.jit Singh Boon v. State of West Bengal & Anr
[1973] 2 S.C.R. 66; Chandra Deo Siagb v. Prakash Chandra Bos;'
[1964] 3 s.c.R. 629; UniOD of India v. Prafulla laar Sa-l ~
Anr., [1979] 2 s.c.R, 229 and Superintendent and Rmewbraneer
A
B
c
D
E
F
G
H
A
B
c
0
E
F
G
. H
624
SUPREME COURT REPORTS
[19861 2 s.c.R.
of Legal Affairs, llest Beogal v. Anil x.&r Bbnnia &
Ora.,~
[1979] 4 s.c.c. 274, relied upon.
· ·
In the instant case, the oral evidence is backed up by
documentary evidence. Some of the relevant documents have
interpolations and the inquiry relating to interpolation has
not become final. It is indeed difficult at this stage to say
that the evidence as a whole is inadequate to establish the
prima facie case. The learned Trial Judge, extracted at greattlength both the oral evidence as also the contents of documents but there was not much of analysis to justify rejection
of the material. The learned Trial Judge adopted two different
standards in the matter of weighing the same evidence when he
agreed to frame 21 charges which were inter-linked and inter- yconnected with the rest of the prosecution story with -
reference to which the draft charges had been given. If the }--
evidence was accepted for half the number of charges relating
to similar offences, there coul~ hardly be any scope to reject
the 22 draft charges. Similarly in regard to the charge of
conspiracy the facts were inter-connected and there could be
no justification to reject the charge even if the other
persons iq>licated were not before the court. The reasoning
given by the learned Trial Judge in support of his order of
discharge in regard to the draft charges relating to ss. 161 ~- ~
and 165, IPC and s. 5(2) read with s. 5(1) of the Act,
concerning these transactions cannot, therefore, be sustained.
[683 D-H; 684 A-B)
3.1 Under s. 245(i) of the Code the requirement is that
the evidence must be such which if not rebutted would warrant ~
conviction of the accused. Under the law of evidence the-{
concept of rebuttable presumption is well-known. Rebuttable ,
\
presumptions of law are a result of the general experience of
a connection between certain facts or things one being usually
bound to be companion or effect of the other. The connection,
however, in this class is not so intimate or so uniform as to
be conclusively presumed to exist in every case; yet, it is so
done that the law itself without the aid of a jury infers one
fact fro. tbe crude existence of the other in the abeeuc:e of ,
opposing evidence. In this mde, the law advances the nature }...
and amount of the evidence which is sufficient to establish a
prima facie case and throws the burden of proof UpGn the other
party; and if no opposing evidence is offered, the jury are
bound to find in favour of the presumption. A contrary verdict
R.S. NAYAK v. A.R. ANTULAY
625
. might be set aside as being against evidence. The rules in
~this class of presumptions as in the former have been adopted
by coiBln consent from 1110tives of public policy and for the
promotion of the general good; yet not as in the former
(conclusive proof) class forbidding all further evidence but
only dispensing with it till some proof is given on the other
side to rebut the presumption raised. Thus, as men do not
generally violate the Penal Code, the law presumes every man
-~to be innocent; but some men do transgress it; and therefore,
·evidence is received to repel this presumption. [684 B-G}
3,2 The presumption raised under s. 4 of the Prevention
of Corruption Act is a presumption of law which a court is
--\bound to draw, once it is proved that the accused Gove~nt
. servant received or obtained a valuable thing in the
-lcircumstanoes mentioned in that section. [685 E]
'
In the instant case, the learned Trial Judge should have
proceeded to scan the evidence keeping in view the concept of
rebuttable presumption. He also failed to take note of s. 4 of
the Act while dealing with the charges under ss. 161 and 165,
IPC as also s. S(l)(a) and (b) of the Act. It is hoped that
while dealing with the case after the framing of the charges,
"' ;..the learned Trial Judge will keep this legal position in mind
and act accordingly. [685 F-G]
~
The State of Madras v. A. Vaidyanatha lyer • [ 1958]
s.c.R. 580 and L Satwant Singh v. State of Punjab, [1960] 2
s.c.R. 592, referred to.
4.1 The main ingredients of the charge under s. 161, IPC
'"'"'are :
(i) that the accused was a public servant, (ii) that he
must
be
shown to
have obtained from any person any
gratification other than legal remneration; and (iii) that
the gratificati~n should be as a motive or reward for doing or
forbearing to do any official act or for showing or forbearing
, to show, in the exercise of his official function, favour or
-idisfavour to any person. [685 H; 686 A-G]
Ordinarily,
when
the
first
two
ingredients
are
established by evidence, a rebuttable presumption arises in
respect of the third. [686 C)
A
B
c
D
E
F
G
H
626
SUPREME COURT REPORTS
[ 19861 2 s.c.R.
A
4.2 For an offence under s. 165, !PC, the essential~
ingredients are : (i) the accused was a public servant ; (ii)
he accepted or obtained or agreed to accept or obtain a
valuable thing without consideration or for an inadequate
consideration knowing it to be .inadequate ; (iii) the person
giving the thing must be a person concerned or interested in
or related to the person concerned in any proceeding or
B
business transacted or about to be transacted by the
government servant or having any connection with the officiatfof himself or of any public !;ervant to whom he is subordinate;
and (iv) the accused must have knowledge that the person
c
D
E
F
G
giving the thing is so concerned or interested or related.
•
[686 C-G]
4. 3 Section 165 is so worded as to cover cases of l
corruption which do not come within ss. 161, 162 or 163. ,..__
Indisputably the field under s. 165 is wider. If public
servants are allowed to accept presents when they are
prohibited under a penalty from accepting bribes, they would
easily circumvent the prohibition by accepting the bribe in
the shape of a present. The difference between the acceptance
of a bribe made punishable under s. 161 and 165, IPC is that
under the former section the present is taken as a motive or
reward for abuse of office; under the latter section the~ . "
question of motive or reward is wholly iaaaterial and the
acceptance of a valuable thing without consideration or with
inadequate consideration from a person who has or is likely to
have any business to be transacted, is forbidden because
though not taken as a motive or reward for showing any -f"'
official favour, it is likely to influence the public servant
·
to show official favour to the person giving such valuabl~·
thing. [686 G-H; 687 A-c)
,·
4.4 The provisions of ss. 161 and 165 !PC as also s. 5
of the Act are intended to keep the public servant free from
corruption and thus ultimately ensure purity in public life.
[687 C]
In the instant case, the evidence, therefore, should {
have been judged keeping these aspects in view. [687 C]
r
5. The main ingredients of the offence of extortion in
s. 383, !PC are : (i) the accused must put any person in fear
H
of injury to that person or any other person; (ii) the putting
of a person in such fear mst be intentional ; (iii) the
r
R. S. NA.YAK v. A. R. A.NTIJLAY
627
. accused lll.lst thereby induce the person so put in fear to
~deliver to any person any property, valuable security or anything signed or sealed which may be converted into a valuable
security; and (iv) such inducement must be done dishonestly.
[690 E-H]
Before a person can be said to put any person to fear of
any injury to that person, it must appear that he has held
~out some threat to do or omit to do what he is legally bound
to do in future. If all that a man does is to promise to do a
thing which he is not legally bound to do and says that if
money is not paid to him he would not do that thing, such act
would not amount to an offence of extortion. [691 A-B]
--)
Babibul Razek. v. King &lperor, A.I.R. 1924 All
197,
4 relied upon.
In the instant case, there is no evidence at all to show
that the managements of the sugar co-operatives had been put
in any fear and the contributions had been paid in response to
threats. Merely because the respondent was Chief Minister at
the relevant time and the sugar co-operatives had some of
their grievances p·ending consideration before the Government
r
~and pressure was brought about to make the donations promising
consideration of such grievances, possibly by way of reciprocity, there is no justification that the ingredients of the
..
offence of extortion have been made out. The evidence led by
the prosecution falls short of the requirements of law in
~-
regard to the alleged offence of extortion. [691 C-D]
-... .
6.1 Cheating is defined in s. 415 of the !PC and the
~ngredients for that offence are : (i) there should be
fraudulent or dishonest inducement of a person by deceiving
him; (ii) the person so induced should be intentionally
induced to deliver any property to any person or to consent
that any person shall retain any property, or (iii) the person
so induced should be intentionally induced to do or to omit to
do anything which he would not do or omit if he were not so
deceived; and (iv) in cases covered by the second part of the
-1 act or omission should be one which caused or is likely to
cause damage or harm to the person induced in body, mind,
reputation or property. [695 C-FJ
6. 2 Section 415 actually consists of two parts, each
part dealing with one way of cheating -
A
B
c
D
E
F
G
H
A
B
c
D
E
F
G
H
628
SUPREME COURT REPORTS
[1986] 2 S.C.R.
(i) Where, by deception practised upon a person the,
accused dishonestly or fraudulently induced that"
person to deliver property to any person or to
consent that any person shall retain any property;
(ii) Where, by deception practised upon a person,
the accused intentionally induces that person to do
or omit to do anything which he would not do or
omit to do, if he were not so deceived and whic~
act or omission causes or is likely to cause damage
or harm to that person in body, mind, reputation or
property. [695 G-H; 696 A]
_
In the instant case, the learned Trial Judge failed to ?'
analyse the evidence which he had at great length extracted·\, ··
keeping the proper angle of approach in view. Therefore, his,.
conclusion is not made on a proper assessment and is not
sustainable.
The
evidence,
oral and documentary,
taken
together does justify the framing of a charge for the offence
under s. 420, IPC. However, the position is a presumptive one
open to rebuttal by the respondent. A charge under s. 420,
IPC, should, therefore, be framed by the learned Trial Judge
against the respondent. [696 B-D]
7. There must be an assumption that whatever is published
in the Government owned paper correctly represents the actual
state of affairs relating to Governmental business until the
same is successfully challenged and the real state of affairs
is shown to be different from what is stated in the Government
'"' ......
-
publication. [693 B-e)
~
Barpal Singh & Anr. v. State of Hl.alc:hal Pradesh, [1981]~
1 s.c.c. 560, relied upon.
\
Per Bhagwatl, C.J. (Ranganath Misra, J. concurring)
8.1 When the court is considering under s. 245 sub-s. (1)
··
of the Code of Criminal Procedure whether any case has been
made out against! the accused which, if unrebutted, would ,
warrant his conviction, it is difficult to understand as to ~·
how the court can brush aside the presumption under s. 4 of
the Prevention of Corruption Act, 1947. Sub.s. (1) of s. 4 of
that Act provides that where in any trial of an offence
R.S. NAYAK v. A.R. ANTULA.Y
629
punishable under s. 161 or 165 of the Indian Penal Code or of
~ an offence referred to in cl. (a} or cl. (b) of sub-s. (1) of
s. 5 of that Act it is proved that an accused has accepted or
obtained or has agreed to accept or admitted to obtain for
himself or for any other person, any gratification (other than
legal remuneration) or any valuable thing from any person, it
shall be presumed, unless the contrary is proved·, that he
accepted or obtained or agreed to accept or admitted to
~ obtain, that gratification or that valuable thing as a motive
or reward such as is mentioned in s. 161 or as the case may
be, without consideration or for a consideration which he
knows to be inadequate. When the Court is called upon to
consider whether a charge should be framed or not the question
to which the Court has to address itself is whether the
--1 evidence led on behalf of the prosecution is such that, if
_ ~- unrebutted, it would justify the conviction of the accused and
the court has, therefore, to examine the evidence as it stands
without rebuttal and coJDe to a conclusion whether on the basis
of such evidence the court would convict the accused and where
the offence charged against the accused is under s. 161 or s.
165 or el. (a) or clause (b) or sub-s. (1) or s. 5, the court
must necessarily apply the presumption under s. 4 while
considering whether on the basis of the unrebutted evidence
~ _
_)__ which is before it the court would convict the accused. Therefore, even for the purpose of considering whether a charge
should be framed or not the presumption under s.. 4 mst be
taken into account. 632 A-G]
-
8.2 Sections 161 and 165 of the !PC have been enacted by
---') the Legislature with a view to eradicating corruption in
public life. The court must therefore interpret s. 165
~ according to its plain language without in any manner being
· anxious or astute to narrow down its interpretation. Section
165 DllSt be construed in a manner which would advance the
remedy and suppress the mischief which is intended to be
curbed. [634 D-E]
'-.--(
~c. Jacob v. Union of India, [1963] 3 s.c.R. 800, relied
upon.
8.3 Section 165 is wider than s. 161 and an act of
corruption not falling within s. 161 may yet come within the
wide terms of s. 165. What s. 161 envisages is that any
A
B
c
D
E
F
G
H
A
B
c
D
E
F
G
H
630
SUPREME COURT REPORTS
[ l 9 86] 2 S.C. R.
gratification other than legal remuneration should have been
accepted or obtained or agreed to be accepted or attempted to ~
be obtained by the accused for himself or for any other person
as a rotive or reward for doing or forbearing to do any
official act or for showing or forbearing to show, in the
exercise of his official function, favour or disfavour to any
person, or for rendering or attempting to render any service
or disservice to any person, while s. 165 does not require
taking of gratification as a motive or reward for any specific ~
official action, favour or service but strikes at obtaining by
a public servant of any valuable thing without consideration
or for a consideration which he knows to be inadequate from
any person whom he knows to have been or to be or likely to be
concerned in any proceeding or business transacted or about to ~
be transacted by such public servant or having any connection \
with the official functions of himself or of any public
~
servant to whom he is subordinate or from whom any person whom '
he knows to be interested in or related to the person so
concerned. Whereas under s. 161 it is necessary to establish
that the taking of gratification must be connected with any
specific official action, favour or service by way of motive
or reward, no such connect ion is necessary to be proved in
order to bring home an offence under s. 165 and all that is
necessary to establish is that a valuable thing is accepted or _._ ...,.
obtained or agreed to be accepted or attempted to be obtained
by a public servant from any person whom he knows to have been
or to be likely to be concerned in any proceeding or business
transacted or about to be transacted by such public servant or
having any connection with the official function of such
public servant and such valuable thing has been accepted or (*-
obtained without consideration or for a consideration which
,-
such public servant knows to be inadequate. [ 634 F-H; 635 A-E] ,.,
The reach of s. 165 is definitely wider than that of s.
161. Moreover, it is clear from illustration (c) to s. 165
that money or currency is regarded by the Legislature as a
valuable thing and if it is accepted or obtained by a public
servant without consideration or for inadequate consideration
in the circumstances set out. in s. 165, such public servant
would be guilty of an offence under that section. [635 E-F]
CRIMINAL APPELLATE JURISDICTION : Criminal Appeal No. 658
of 1985.
}.---
'
R.S. NAYAK v. A.R. ANTULAY
[BHAGWATI, C.J.}
631
From the Judgment and Order dated 23/24/29/30th April,
1985 of the Bombay High Court in Special Case No. 24 of 1982.
Ram Jethmalani,
M.V.
Katarke, Jai Singhani, Mahesh
Jeth~lani, K.N. Madhusoodhanan, Satish Maneshinde
and Ms.
Rani Jethmalani for the Appellants.
L.N. Sinha, P.P. Rao, S.B. Bhasme, R.D.
Ovalekar, D.R •
.. Gadgil, Miteen v. Pradhan, Rajendra s. Desai, V.M. Kanade,
Mahesh Rajedhyaksha, P.P. Singh, A.S. Bhasme, A.M. Khanwilkar
and M.N. Shroff for the Respondents.
The following Judgments of the Court were del~vered
)
;.
BBAGWATI, C.J. I agree with the judgment about to be
~, delivered by my learned brother Ranga Nath Misra, but there
are some two or three charges in regard to which I should like
to make more detailed observations since they have not been
dealt fully by my learned brother and he has left it to me to
consider them in some detail. Since the genesis of this appeal
has been set out by my learned brother at length I do not
propose to repeat what has been so ably said by him and I will
confine myself only to the facts relating to the charges which
). are going to be'dealt with by me. But I may be permitted to
say a few words in regard to two points which have been
discussed by my learned brother in his judgment since they are
of some importance and can without impropriety bear further
discussion.
~
The first point arises out of a contention raised by the
1
learned counsel appearing on behalf of the first respondent
,. (hereinafter referred to
as
the
• respondent') that the
presumption under Section 4 of the Prevention of Corruption
Act 1947 applies only after a charge is framed against an
accused and has no application at the stage when the court is
considering the question whether a charge should be framed or
not. It is said in geometry that a point has position but no
magnitude, but we are constrained to observe that this point
raised on behalf of the first respondent has not only no
-4.
magnitude but has even no position. It is wholly without
substance and indeed it is surprising that it should have been
raised by the learned counsel appearing on behalf of the first
A
B
c
D
E
F
G
H
A
632
SUPREME COURT REPORI'S
[1986] 2 s.c.R.
respondent. When the court is considering under Section 245
sub-section (1) of the Code of Criminal Procedure whether any r
case has been made out against the accused which if unrebutted
would warrant his conviction, it is difficult to understand as
to how the court can brush aside the presumption under Section
B
4 of the Prevention of Corruption Act, 1947. Sub-section (1)
of Section 4 of that Act provides that where in any trial of
an offence punishable under Section 161 or Section 165 of the
Indian Penal Code or of an offence referred to in clause (a) ..
or clause (b) of sub-section (1) of Section 5 of that Act it
is proved that an accused has accepted or obtained or has
C
agreed to accept or admitted to obtain for himself or for any
other
person,
any
gratification
(other
than
legal
remuneration) or any valuable thing from any person, it shall
~
be presumed, unless tne contrary is proved, that he accepted ,
or obtained or agreed to accept or admitted to obtain, that >-
gratification or that valuable thing as a motive or reward
D
such as is mentioned in Section 161 or as the case may be,
without consideration or for a consideration which he knows to
be inadequate. When the court is called upon to consider
whether a charge should be framed or not the question to which
the court has to address itself is whether the evidence led on
behalf of the prosecution is such that if unrebutted it would
E
justify the conviction of the accused and' the Court has, i
therefore, to examine the evidence as it stands without
rebuttal and come to a conclusion whether on the basis of such
evidence the court would convict the accused and where the
offence charged against the accused is under Section 161 or
Section 165 or clause (a) or clause (b) of sub-section (1) of
F
Section 5 the Court must necessarily apply the presumption
~
under Section 4 while considering whether on the ~sis of the
unrebutted evidence which is before it the court would convict~
the accused. We do not therefore see any substance in the '·~
contention raised on behalf of the first respondent and we
\
must proceed to dispose of this appeal on the basis that even
'
G
for the purpose of considering whether a charge should be
framed or not the presumption under Section 4 must be taken
into account.
H
The second point on which considerable controversy was
raised before us related to the scope and ambit of Section 165
of the Indian Penal Code. I agree with my learned brother that
it may not be desirable at this stage to define the precise
~
\
R.S. NAYAK v. A.R. ANTULAY
[BHA<l¥ATI, C.J.]
633
. ambit and coverage of Section 165 because that is a matter
,-. which will have to be considered by the High Qlurt in depth
when the case goes back before the High Court and the first
respondent is called upon to face his trial on the charges
A
framed against him. But it is necessary to indicate the broad
B
parameters
of
Section 165
and to emphasize
the basic
distinction which exists between that Section and Section 161.
It may be pointed out straight away that these two sections
4 have been enacted by the Legislature with a view to eradicat-
. ing corruption in public life. We may usefully quote here the
following pertinent observations made by this Court in Re :
Special Courts Bill which came
by way of Presidential
C
Reference and which is reported in 1979 (2) s.c.R. 476 :
" •••• As I read it, this measure is the embryonic
expression of a necessitous legislative project,
which, if full-fledged, will work a relentless
break-through
towards
catching,
through
the
D
compulsive criminal process, the higher inhabitants
of Indian public and political decks, who have in
practice, remained 'untouchable' and 'unapproachable' to the rule of law. 'O~eration Clean Up' is a
'consUIIIJlation devoutly to be wished', although
naive optimism cannot obfuscate the obnoxious exE
perience that laws made in terrorem against those
who belong to the top power bloc prove in action to
be paper tigers. The pathology of our public law,
with its class slant, is that an umnincing oobudsman or sentinel on the qui vive with power to act
against those in power, now or before, and offering
F
legal access to the informed citizen to complain
with iDIDllnity does not exist, despite all the
bruited umbrage of political performers against
peculations and perversions by higher echelons. Law
is what law says and the moral gap between word and
deed menaces people's faith in life and law. And
G
then, the tragedy- democracy becomes a casualty."
"The impact of 'sunmit' crimes in the Third World
setting is more terrible than the Watergate syndrome as perceptive social scientists have unmasked. Corruption and repression-cousins in such
H
situations-hijack developmental processes. And, in
A
B
c
0
E
F
G
H
634
SUPREME COURT REPORTS
[19861 2 s.c.R.
the long run, lagging national progress means ebbing people's confidence in constitutional means to?-
social justice. And so, to track down and give
short shrift to these heavy-weight criminaloids who
often mislead the people by public moral weightlifting and multipoint. manifestoes is an urgent
legislative mission partially undertaken by the
Bill under
discussion.
To
punish such super
offenders in top positions, sealing off legalistic~
escape routes and dilutory strategies and bringing·
them to justice with high speed and early finality,
is a desideratum voiced in vain by Commissions and
Conmittees in the past and is a dimension of the
dynamics of the Rule of Law ••••• "
-r·
The Court TDJst therefore interpret Section 165 according to ~
its plain language without in any manner
being anxious or
astute to narrow down its interpretation. Section 165 must be
construed in a manner which would advance the remedy and
suppress the mischief which is intended to be curbed. This was
the canon of construction which was adopted by this Court in
interpreting Section 165 in R.C. Jacob v. Union of India,
[ 1963] 3 S.C. R. 800. There are a few decisions of ancient
vintage which have dealt with the interpretation of Section_,( ~
165 but since we are not finally laying down the true scope
and ambit of Section 165 we do not propose to discuss these
decisions. Suffice it to point out at the present stage that
on its plain terms Section 165 is wider than Section 161 and
•
that an act of corruption not falling within Section 161 may
yet come within the wide terms of Section 165. What Section (--
161 envisages is that any gratification other than legal '
remuneration should have been accepted or obtain~d or agreed~
to be accepted or attempted to be obtained by the accused for
himself or for any other person as a 110tive or reward for
doing or forbearing to do any official act or for showing or
forbearing to show, in the exercise of his official function,
favour or disfavour to any person, or for rendering or
attempting to render any service or disservice to any person,
while Section 165 does not require taking of gratification as
a motive or reward for any
specific official action, favour~
or service but strikes at obtaining by a public servant of any'
valuable thl.ng without consideration or for a consideration
which he knows to be inadequate, from any person whom he knows
R.S. NAYAK v. A.R. ANTULAY
[BHAGWATI, C.J.]
635
A
to have been or to be or likely to be concerned in any
~proceeding or business transacted or about to be transacted by
such public servant or having any connection with the official
functions of himself or of any public servant to whom he is
subordinate or from whom any person whom he knows to be
interested in or related to the person so concerned. Whereas
B
under Section 161 it is necessary to establish that the taking
of gratification must be connected with any specific official
---\-action, favour or service by way of motive or reward, no such
connection is necessary to be proved in order to bring whom an
offence under Section 165 and all that is necessary to
establish is that a valuable thing is accepted or obtained or
agreed to be accepted or attempted to be obtained by a public
C
~ servant from any person whom he knows to have been or to be
~ likely to be concerned in any proceeding or business
-1 transacted or about to be transacted by such public servant or
,, having any connection with the official function of such
public servant and such valuable thing has been accepted or
_ obtained or agreed to be accepted or attempted to be obtained
D
without consideration or for a consideration which such public
servant knows to be inadequate. The reach of Section 165 is
definitely wider than that of Section 161. Moreover, it is
clear from illustration (c) to Section 165 that money or
'J_~currency is regarded by the Legislature as a valuable thing
and if it is accepted or obtained by a public servant without
E
consideration or for inadequate consideration in the circumstances set out in Section 165, such public servant would be
guilty of an offence under that Section. Having said this much
on the interpretation of Section 165 we now proceed to examine
~~~ the facts on the basis of which the High Court has declined to
. frame certain charges against the. first respondent.
F
r
We will first deal with the 35th, 36th and 37th of the
draft charges which were submitted by the lea~ned counsel for
the appellant before the High Court and on the basis of which
the High Court was invited by him to frame charges against the
first respondent. These charges related to a transaction in
G
which according to the appellant, a sum of Rs. 8 lakhs was
paid by one Ramesh Merchant and his partners by way of
--.4 contribution to Indira Gandhi Pratibha Pratishthan on 16th
April 1981 as a motive for the granting of no objection
certificate by the first respondent for letting out of certain
premises by M/s Nanubhai Jewellers of which Ramesh Merchant
H
A
B
c
D
E
F
G
H
636
SUPREME COURT REPORTS
[1986] 2 S.C.R.
and some others were partners to Indo-Suez Bank. The facts r
giving rise to these charges in so far as relevant may be
briefly stated as follows.
There was a firm called M/s Nanubhai Jewellers which was
in possession of certain ground floor premises situate at 113/
115, Mahatma Gandhi Road, Fort, Bombay as a tenant. There were
various changes in the constitution of this firm from time to
time but we are not concerned with these changes in thefpresent appeal. What is material to note is that at the
relevant time this firm consisted of Mukesh Dadlani, Lal Chand
Rohra, Ramesh Merchant his father and two other partners. The
rent payable by this firm was originally Rs. 3000 per month
but under a new agreement of lease dated 27th September 1979 ~
the rent was raised to Rs. 15000 per month in consideration of
the landlords giving to the tenant power to sub-let the}
premises. It seemc; that si.nce 1979-80 this firm was incurring
losses and was not in a position to make use of the premises
for its own purposes and hence it decided to sub-let the
entire premises barring about 500 sq. ft. to Indo-Suez Bank at
a monthly rent of Rs. 1,24,120 and an agreement of lease was
entered into between them on 12th December 1980. But it was
not possible for this firm to sub-let the premises to
Indo-Suez Bank without a no objection certificate from the ;1,__ "'
Controller of Accommodation in view of the Bombay
Land
Requisition Act 1948. The partners of this firm therefore made
an application to the Controller of Accommodation on 13th
Janullry 1981 pointing out that the
Indo Suez Bank
had
approached them with a request to allow them to use the
.- ~
premises for the purpose of opening their branch office in (
Bombay and that it would be advantageous to the country to --J
make it possible for the Indo-Suez Bank to open a branch r
office and requesting the Controller of AccotmOOdation "to
grant the necessary permission ••••••••••• to permit the Bank to
use the premises on sub-lease basis". Though this application
was dated 13th January 1981, it appears from the endorsement
made on the application that it was received in the office of
the Controller of Accommodation on 11th February 1981. Thereafter on 19th February 1981 an officer from the office of the ,
Controller of Accommodation visited the premises and certain t"-
documents
relating
to the partnership of 'A./s
Nanubhai
Jewellers were handed over by Lal Chand Rohra and the father
of Ramesh Merchant to such officer. They also handed over to
R.S. NAYAK v. A.R. ANTULAY
[BHAGWATI, C.J.]
637
..
such officer copies of the rent receipts for November, 1973
and November·, 1980 as also a Xerox copy of the registration
~ ~, certificate of the firm under the Bombay Shops and Establish-
) ments Act. Ramesh Merchant several times went to .the office of
the Controller of Accommodation for no-objection cP.rtificate
but he was told that the application was under process. Now
the record shows that on 14th February, 1981 a noting was made
in the file seeking a direction whether suppressed vacancy
t
. inquiry should be made to ascertain whether the premises could
! be requisitioned as a suppressed vacancy or whether the no
objectiort certificate should be granted. Further inquiry was
thereupon made for the purpose of determining whether there
was a suppressed vacancy in respect of the premises and after
such inquiry was completed a further noting was made on 2nd
March 1981 recommending that in view of the facts set out in
that noting ''it is for orders whether we may consider the
request and grant" the no objection certificate in this case.
~ Shri Rawat, who was an Accommodation Officer, made an endorsement on the foot of his further noting pointing out that
·according to the inqulry made by the office no vacancy had
actually occurred at any time in the premises and there was
accordingly no suppressed vacancy and moreover only a part of
the premises was proposed to be sub-let by the firm of M/s
Nanubhai Jewellers and hence the premises could not . be re-
~ quisitioned as a suppressed vacancy and consequently no objection certif1cate might be granted. The file containing these
notings thereafter went fo the· Additional Chief Secretary who
also placed his signature below that of Shr1 Rawat indicating
his agreement with the endorsement made
by Shri Rawat. The ..
· date below the signature of.the AdditiQnal Chief Secretary is
a little doubtful but we can safely take it to be 2nd March
~ 1981 since there is an endorsement at the botto~ of the page
~ showing that the file was received in the Secretariat of t:!e
Additional Chief Secretary on 12th March 1961 and obviously it
~t have gone to the Secretariat to the Chief Minister after
~tng of the endorsement by the Additional Chief Secretary.
The page of the file containing the endorsement of Shri Rawat
!'? atso contains in red ink. an endorsement made by the first
respondent and thls endorsement reads "in view of "lA"'
11B"
e&ay be done'' and below this endorsement is the signature of
the first respondent and below that is the date which
~~sently reads 16/3.