L. Narasimha Reddy, J.
1. This appeal is directed against the judgment of the Court of Special Judge for SPE and ACB cases, Nellore dated 16-10-1996 in C.C. No. 3 of 1992. The trial Court through its judgment under appeal had convicted the appellant for an offence under Section 5(i)(e) read with Section 5(2) of the Prevention of Corruption Act, 1947 and sentenced him to undergo rigorous imprisonment for a period of three years and to pay a fine of Rs. 40,000/-, in default, to suffer simple imprisonment for a period of one year.
2. The petitioner was employed as Assistant Motor Vehicle Inspector initially in the year 1960 and thereafter, he was promoted as Motor Vehicle Inspector on 28-1-1972. On suspicion that the assets of the petitioner are disproportionate to his known sources of income, the prosecution had undertaken evaluation of the assets held by him and his known sources of income from 1-1-1971 to 26-10-1983. On such evaluation it came to the conclusion that the income of the accused during the check period through various known sources, such as salary for the post held by him, agriculture, his rents, insurance, was Rs. 7,98,213/-. It had taken into account seven items of expenditure and found that the net expenditure during the check period was Rs. 4,84,686/-. The assets held by the appellant during the check period were assessed at Rs. 8,78,409/-. On the basis of these figures, the prosecution took the view that the appellant held assets in excess of his known sources of income to an extent of Rs. 5,43,000/-. A charge was framed on the basis of these allegations. The prosecution examined by P.W. 1 to P.W. 51 and marked Exs. P1 to P171. The appellant examined D.W. to D.W. 9 and marked documents Exs. D1 to D20. Ex. X1 was also marked. On appreciation of oral and documentary evidence the trial Court found the accused guilty of the offence. It had convicted and sentenced as indicated above.
3. Sri T. Bali Reddy, learned senior counsel appeared for the appellant submits that the prosecution had included several items of assets, which in fact do not belong to the appellant. According to him, item Nos. 1, 2, 3, 6, 9, 10, 11 and 12 do not belong to the appellant at all and the prosecution has placed nothing before the Court to show that the appellant had any concern with the said assets much less, ownership. According to the learned counsel, if the said items are excluded from the assets of the appellant it cannot be said that the appellant holds any assets or properties in excess of his known sources of income. The learned standing counsel for the ACB Sri G. Pedda Babu on the other hand, submits that the prosecution has placed ample evidence before the trial Court in support of its plea that the said items were held benami by the appellant. It is also his case that the prosecution had adopted on objective approach inasmuch as it had taken into account the income from the said items of properties also.
4. The fact that the case relates to the alleged disproportionate assets said to have been held by the appellant during the check period i.e. 1-1-1971 to 26-10-1983. In the matters of this nature, the prosecution has to establish that the various items which it attributes to the public servant are held by him directly or even indirectly. Where the properties stand in the name of the public servant the same does not pose any problem. However, in cases where the properties are held in the names of persons other than the public servant, necessary evidence has to be adduced to establish that the public servant is the true owner of the said assets, though they stand ostensibly in the name of different persons. It is with this background that the case needs to be examined.
5. Items 1 and 2 are the plots of land situated at Tirupathi and the constructions made thereon. The properties stood in the name of one Mr. K.V. Swamy. It was the case of the prosecution that K.V. Swamy is the maternal uncle of the appellant and the said property was held benami for the appellant by K.V. Swamy. The prosecution did not examine K.V. Swamy. The sale deed in respect of the said property was seized from the house of K.V. Swamy. The municipal records reveal that the properties recorded in his name and that the construction permission was obtained by him. P.W. 49 is the Investigating Officer who has extensively spoken about each and every item and assets, income and expenditure. As regards, item No. 1, this is what P.W. 49 has said in his cross-examination :
'The recitals in Ex. P119 show that K.V. Swamy/contractor paid the sale consideration to Krishnamanaidu. I did not examine the vendor Krishnamanaidu under Ex. P119 since he is not available. Nor did I examine the attestors, scribe or identifying witnesses relating to Ex. P119. Ex. P119 was seized from the house of K.V. Swamy. I examined K.V. Swamy but did not cite him as a witness as per legal opinion, I did not examine any witnesses in the Court to show that the accused paid the sale consideration to Krishnamanaidu. It is not true to say that item I belongs to K.V. Swamy and the accused is nothing to do with it.'
6. As regards, item No. 2 the following was elicited through P.W. 49 :
'The permission was obtained in the name of K.V. Swamy. As per Ex. P96 the Municipal Commissioner of Tirupathi Municipal Corporation stated that the house does not stand in the name of accused but it was assessed to Municipal tax in the name of K.V. Swamy. Exs. D13 to D18 are in the name of K.V. Swamy, (for demand receipts). It is true that the electricity department and the Tirupathi Municipality has given electricity service connection and Municipal tap connection in the name of K.V. Swamy. It is not true to say that K.V. Swamy has been paying the electricity charges and water consumption charges. But they are being paid by the tenants. I did not examine the clerks in APSEB and TMC to ascertain who paid the deposits, for electrical connection and tax connection. It is not true to say that P. V. Swamy let out the house to P.W. 3.'
7. An attempt was made to plead that P.W. 8 was the tenant in respect of the said premises and he was paying the rent to the appellant. In his cross-examination P.W. 8 has stated as under :
'I never met the AO. There was no rent deed executed by me. No receipts were passed in token of having received the rents, from me. I have not seen the title deeds pertaining to that building which I took on lease. I heard from my mother-in-law that the said house belongs to the AO.'
8. From this evidence it is clear that hardly there exits any material to connect the said items of property with the appellant. When P.W. 9 in categorical items says that he did not examine any one as regards the ownership and that he does not have any record to show that it belongs to the appellant, it was totally impermissible to include the said items in the lists of assets of the appellant.
9. Item No. 3 is a second hand car said to have been purchased by K.V. Swamy with the funds provided by the appellant. It was elicited from P.W. 49 that he did not examine the vendor of that car or the sale letter issued therefor. It was further suggested to him that K.V. Swamy had purchased the said car for a consideration of Rs. 10,000/-from one Mr. Padmanabhan in the year 1972, ran it as a taxi and sold it two years thereafter.
10. The appellant admitted that he holds assets of items 4 and 5. Item No. 6 is a scooter standing in the name of one Mr. P. Mohan Rao. He purchased it from one B. Narsimhulu. It was not even alleged that either B. Narsimhulu or P. Mohan Rao were in any way related to the appellant, much less the appellant had provided the funds for purchasing the same. Only on the ground that the scooter was being used by the son of the appellant, it was added to his assets.
11. Item No. 7 comprises certain items of gold and jewellery and the appellant admitted the ownership of the same. So is the case with item No. 8, which is bank balance. Item No. 9 is a truck bearing registration No. ADM 4345. It is registered in the name of M. Swaroop Kumar son of the appellant. It is valued at Rs. 2,19,00/-. The prosecution alleged that the appellant provided the funds for purchase of the said vehicle. During the course of the cross-examination of P.W. 49 it was elicited through him that Swaroop Kumar was married one Jyothsna, daughter of Venkateshwar Rao, who was examined as D.W. 1. It was also suggested that D.W. 1 is a businessman, had three buses and agricultural lands of Ponnur and two houses of Guntur and various amounts were presented to the wife of Swaroop Kumar. Coming to the aspect of purchase of lorry, P.W. 49 admitted that Swroop Kumar took loan of Rs. 1,50,000/- from M/s. Jaya Finance of Ongole. This is what P.W. 49 said in this regard :
'Swaroop Kumar took a loan of Rs. 1,50,000/- from Jaya Finance of Ongole for purchasing the lorry bearing No. ADM 4345 in his name, I cannot say whether income-tax officer passed an assessment order. I examined I.T.O. on 20-2-1985. The application Ex. P47 is in the name of Swaroop Kumar. Ex. P.48 is the invoice under which the chasis of the lorry was delivered to the son of AO. Ex. P136 show as to how Swaroop Kumar raised finance for purchasing the lorry. Witness adds according to the investigation certain items under the documents are not real transactions. I did not inform the I.-T.O. in respect of the policy of the documents produced by Swaroop Kumar since it is not within the ambit of my policy. I furnished my reasons as to why these documents are false. No documentary evidence is available to show that the transactions under which the finance raised from his relations are false.'
12. The case as regards item No. 12 is almost similar. This is also a truck bearing No. AAC 9816 registered in the name of one Mr. Pundari. It is relevant to extract the relevant portion of the deposition of P.W. 49 in this regard ;
'I examined the witnesses to ascertain the financial background of Pundari. Loan from Punkaj Suresh Chand Financiers Madras was taken for purchase of lorry by Pundari. The instalments in respect of this loan waspaid by way of demand drafts. The chasis was delivered to Pundari by V. S. P. Motors Pondicherry. I did not produce any evidence to show that this amount was paid by AO from his pocket. All the documents relating to this lorry are standing in the name of Pundari. These documents were not seized from the house of AO.'
13. Item No. 10 is a scooter in the name of Mr. Swaroop Kumar, son of the appellant. Item No. 11 was deleted by the trial Court itself. Having regard to the fact that he was running a truck and having his own independent business it is rather difficult to accept that Swaroop Kumar did not have the capacity to purchase a scooter worth Rs. 6,000/- and the same was financed by the appellant. The evidence as regards the two trucks does not warrant a finding that they were held by the appellant.
14. It is true that in the list of sources of income, the prosecution had included the income from items 1 and 2 and the two trucks referred to above. The house rent was estimated at Rs. 58,968/- and income from two lorries was estimated at Rs. 2,29,220/-and Rs. 14,325/- respectively. However, in the items of expenditure also the said items were referred to. The expenditure for these items would almost neutralize the income said to have been derived from them. The net result is that if items 1 3, 6, 9, 10 and 12 are deleted from the list of assets expenditure and income the appellant does not hold any assets disproportionate to his known source of income. The trial Court did not take these aspects into account. It had accepted the ownership in respect of these items on the basis of certain assumptions. When a finding in this regard is going to result in serious and for reaching consequences, it is required to be on sound principles of appreciation and on the basis of unimpeachable evidence. It has been pointed in the preceding paragraphs that even the Investigating Officer was not sure about the ownership of the petitioner vis-a-vis the said items. Under these circumstances, this court is convinced that the appellant did not hold any assets disproportionate to his known sources of income.
15. Accordingly, the appeal is allowed. Judgment of the trial Court is set aside, fine amount if any paid by the appellant shall be refunded to him.