Rama Krishna Sahu and Manoranjan Purohit Vs. State of Orissa - Court Judgment

Excerpt:
criminal - contradiction - sections 109, 409 and 467 of indian penal code, 1860(ipc) and section 5(1)(c), 5(1)(d) and 5(2) of prevention of corruption act, 1947 - appellant no.1 and 2 were accused of offences under sections 409/467/109 as well as section 5(2) read with 5(1)(c) and 5(1)(d) of act of 1947 - trial court convicted them under aforesaid sections - hence, present appeal challenging conviction - held, in instant case appellant no.1 was incharge of taking decision as to purchase of impugned materials - but prosecution failed to prove that no other than appellant no.1 was responsible for alleged authorization of purchase of impugned materials - hence, appellant no.1 cannot be liable for offence under section 5(2) read with 5(1)(c) and 5910(d0 of act of 1947 - further prosecution case had not been corroborated by its witnesses - evidence of prosecution witnesses was contradictory - once prosecution failed to establish guilt of appellant no.1 beyond reasonable doubt charges against appellant no.2 cannot be sustained - appellant no.2 was sub ordinate to appellant no.1 - hence, order of conviction of appellants liable to be set aside - appeal accordingly allowed - state financial corporations act, 1951 [63/1951]. section 29; [p.k. tripathy, a.k. parichha & n.prusty, jj] discharge of loan orissa forest act (14 of 1972), section 56 confiscation of vehicle - held, the authorities under section 56 of the orissa forest act, 1972 are not obliged to release the vehicle from the confiscation proceeding or to pay the sale proceeds of the vehicle after the order of confiscation in favour of orissa state financial corporation when such vehicles were purchased on being financed by the orissa state financial corporation and the loan had not been liquidated by the date of the seizure/confiscation of the vehicle. concept of first charge or second charge has no applicability when the vehicle is not otherwise disposed of to determine the liabilities of the loanee. on the other hand the vehicle having been found indulged in forest offences was made subject matter of a confiscation proceedings, and therefore, the procedure followed for confiscation of the vehicle and for its sale is punitive in nature and not with a view to give benefit to anybody including the department which initiated the confiscation proceeding. apart from that, the claim of the orissa state financial corporation as against its loanee (who had taken the vehicle on hire- purchase agreement) brings the loanee and the sureties within the default clause under the state financial corporation act, 1951 or the heirs and successors of such persons. procedure is provided in the act, 1951 and the rules thereof about the manner in which such loan is to be recovered, and in that context only the vehicle under the hire-purchase agreement is placed as the first charge. if such property is not available for any reason, then the loan is not automatically waived or the loanee and his sureties are not automatically redeemed of the liabilities to repay. the financial corporation is concerned with repayment of loan either from the property or persons offered as surety. thus, a vehicle, which is subject matter of confiscation proceeding under the act, 1872, being not available to the orissa state financial corporation for adjustment of the unpaid loan, that does not at all bring out an anomalous situation so as to defeat the right of the orissa state financial corporation. agreement between the orissa state financial corporation and the loanee is a pure and simple contract governed by the provisions of the contract act, 1872 read with the provisions in the act, 1951 and its rules. on the other hand, a confiscation proceeding under the act, 1972 is punitive in nature for commission of a forest offence. thus, by virtue of the provision in section 56 read with section 64 (2) of the act, 1972, the action taken for confiscation of the vehicle cannot be extended to grant protection of the loan advanced by orissa state financial corporation. by doing that it amounts to grant premium to the pick-pockets in as much as, by making payment of the confiscation amount in favour of the orissa state financial corporation the loan burden of the accused of the forest offence is reduced to the extent of the sale proceeds of the vehicle. in other words, on payment of the sale proceeds of the confiscation proceeding to the orissa state financial corporation towards discharge of the loan account of the accused of a forest offence, it would lead to a system to reward him by repayment of his loan. then it does not become a penalty nor the action become punitive, but it remains as a reward to the accused of forest offence. such a concept is totally not conceivable from any provision in the act, 1972 or the act, 1951. [air 2002 orissa 130 overruled]. -- state financial corporations act, 1951. section 29; discharge of loan orissa forest act (14 of 1972), section 56 confiscation of vehicle - held, the authorities under section 56 of the orissa forest act, 1972 are not obliged to release the vehicle from the confiscation proceeding or to pay the sale proceeds of the vehicle after the order of confiscation in favour of orissa state financial corporation when such vehicles were purchased on being financed by the orissa state financial corporation and the loan had not been liquidated by the date of the seizure/confiscation of the vehicle. concept of first charge or second charge has no applicability when the vehicle is not otherwise disposed of to determine the liabilities of the loanee. on the other hand the vehicle having been found indulged in forest offences was made subject matter of a confiscation proceedings, and therefore, the procedure followed for confiscation of the vehicle and for its sale is punitive in nature and not with a view to give benefit to anybody including the department which initiated the confiscation proceeding. apart from that, the claim of the orissa state financial corporation as against its loanee (who had taken the vehicle on hire- purchase agreement) brings the loanee and the sureties within the default clause under the state financial corporation act, 1951 or the heirs and successors of such persons. procedure is provided in the act, 1951 and the rules thereof about the manner in which such loan is to be recovered, and in that context only the vehicle under the hire-purchase agreement is placed as the first charge. if such property is not available for any reason, then the loan is not automatically waived or the loanee and his sureties are not automatically redeemed of the liabilities to repay. the financial corporation is concerned with repayment of loan either from the property or persons offered as surety. thus, a vehicle, which is subject matter of confiscation proceeding under the act, 1872, being not available to the orissa state financial corporation for adjustment of the unpaid loan, that does not at all bring out an anomalous situation so as to defeat the right of the orissa state financial corporation. agreement between the orissa state financial corporation and the loanee is a pure and simple contract governed by the provisions of the contract act, 1872 read with the provisions in the act, 1951 and its rules. on the other hand, a confiscation proceeding under the act, 1972 is punitive in nature for commission of a forest offence. thus, by virtue of the provision in section 56 read with section 64 (2) of the act, 1972, the action taken for confiscation of the vehicle cannot be extended to grant protection of the loan advanced by orissa state financial corporation. by doing that it amounts to grant premium to the pick-pockets in as much as, by making payment of the confiscation amount in favour of the orissa state financial corporation the loan burden of the accused of the forest offence is reduced to the extent of the sale proceeds of the vehicle. in other words, on payment of the sale proceeds of the confiscation proceeding to the orissa state financial corporation towards discharge of the loan account of the accused of a forest offence, it would lead to a system to reward him by repayment of his loan. then it does not become a penalty nor the action become punitive, but it remains as a reward to the accused of forest offence. such a concept is totally not conceivable from any provision in the act, 1972 or the act, 1951. [air 2002 orissa 130 overruled]. - during cross-examination it was elicited from him that various raw materials, like coal and bricks were necessary for the purpose of manufacturing tiles and it was recurring process. dolagovinda barad, the stock mistry was the competent person say about the quantity of bricks and coal used in manufacturing of tiles during the period 5.8.1985 to 21.11.1985, but his examination was withheld for the reasons best known to the prosecution. when prosecution failed to prove that the appellant no. during cross-examination he failed to say the name of the drivers engaged by him in the said truck in different years. he also failed to say on which date his truck carried what goods and to which places. similarly when he failed to name the different drivers engaged in his truck in different years, his evidence that dinabandhu sahu was never his driver, cannot be accepted, particularly when the latter was not examined. accordingly, it is held that prosecution failed to establish the offence under section 467 of ipc against appellant no. when prosecution failed to prop up the charge under sections 5(2) read with section 5(1)(c) and 5(1)(d) of p.r.n. biswal, j.1. both the appeals having been arisen out of a common judgment, the same were heard together and a common judgment is passed thereon.2. the appellants call in question the judgment and order dated 20.6.1995 passed by the special judge (vigilance), sambalpur in t.r. case no. 13 of 1988 convicting the accused-appellant ramakrushna sahu for the offence under section 5(2) read with section 5(1)(c)/5(1)(d) of the prevention of corruption act, 1947 (hereinafter referred to as 'the p.c. act') and sections 409/467 of ipc and sentencing him to undergo r.i. for three years on each count and convicting appellant manoranjan purohit under section 5(2) read with section 5(1)(c)/5(1)(d) of the p.c. act and sections 409/467/109 of ipc and sentencing him to undergo imprisonment for one year on each count.3. shorn of unnecessary details the case of the prosecution is that rama krushna sahu (hereinafter referred to as appellant no. 1) while serving as industries promotion officer (i.p.c. in short) of dhankauda block under sambalpur district, was also in charge of the office of managing director, dhankauda tile making co-operative society (in short 'the co-operative society') from 15.5.1985 to 8.8.1985, while manoranjan purohit (hereinafter referred to as 'appellant no. 2') was accountant of the said society during that time. on 3.6.1985 one voucher bearing no. 960 was prepared by appellant no. 2 showing purchase of three truck load of bricks at the rate of rs. 800/- per truck and to have been carried by the truck bearing registration number ors 9398 being driven by its driver dinabandhu sahu, and it was passed by appellant no. 1. but during enquiry it was ascertained that there was no such purchase of bricks on that date and as such there was no question of transportation of any brick to the society by truck bearing registration number ors 9398 being driven by dinabandhu sahu. appellant no. 1 forged vouher no. 960 and misappropriated an amount of rs. 2400/- by falsification of official records being abetted by appellant no. 2. it is the further case of prosecution that appellant no. 2, while taking charge of managing director of the co-operative society from his predecessor sri d.r. mund (p.w.4), received a stock of 26345 m.ts. of coal on 15.5.1985 and utilized 15700 m.ts. of coal during his incumbency as such, so he should have given charge of the balance of 10645 m.ts. of coal to his successor sri j.b. chand (p.w.3), but he sold away the same at the rate of rs. 300/- per metric ton and misappropriated the sale proceeds amounting to rs. 3204.15.4. on these allegations bipin bihari das, inspector of police (vigilance), sadar squad, sambalpur (p.w.5) lodged a written report before the superintendent of police (vigilance), northern division, sambalpur and being directed by him took up investigation of the case. in course of investigation he examined the witnesses, seized the relevant registers and documents from the co-operative society, prepared seizure list under ext. 7, produced the consolidated report of his investigation and the relevant papers before the director of industries, orissa (p.w.6) for necessary sanction, arrested both the appellants, released them on bail and after completion of investigation submitted charge sheet under the aforesaid sections against them.5. the plea of the appellants was complete denial of their involvement in the crime in question. it was the further plea of appellant no. 1 that whatever stock he took charge of from his predecessor and the stock he purchased were exhausted in manufacturing of tiles in the factory.6. in order to prove its case prosecution examined six witnesses as against none by the defence. after assessing the evidence on record the special judge (vigilance), sambalpur held that appellant no. 1 forged the voucher in question and sold away the balance stock 10645 m.ts. of coal at the rate of rs. 300/- per metric ton and misappropriated the sale proceeds being abetted by appellant no. 2 and as such, convicted them for the offences they were charged with and sentenced them thereunder as mentioned earlier.being aggrieved by the said order of conviction and sentence, the appellants have preferred the present appeals separately.7. at the out-set learned counsel appearing for appellant no. 1 submitted that in the capacity of managing director of the co-operative society, appellant no. 1 was alleged to have committed the offences in question. the said co-operative society having not been created by any statute cannot be said a corporation established by or under an act of the central or state legislature. appellant no. 1 while discharging the function of the managing director of the co-operative society was not a public servant and as such he cannot be liable under any penal provision of p.c. act. in support of his submission he relied on the decisions in s.s. dhanoa v. municipal corporation, delhi and ors. 1981 sc 1395 and state of gujarat v. manshankar prabhashankar dwivedi and anr. : [1973]1scr291 . in the decision s.s. dhanoa (supra) the apex court held that a co-operative society is not a statutory body, because it is not created by a statute. it is a body created by an act of a group of individuals in accordance with the provision of a statute. so a government employee working on deputation in a co-operative society cannot be said a public servant. in the decision state of gujarat (supra) manshankar dwivedi was a lecturer in a government college. it was alleged that while he was being appointed as an examiner under gujarat university, he accepted illegal gratification of rs. 500/- for showing undue favour to a candidate and as such was charged under section 5(2) of p.c. act read with section 161 of ipc. the apex court held that as dwivedi was not a public servant while he was acting as an examiner, it could not be said that there had been any abuse by him of his position as a public servant. it was never the case of the prosecution that he had been guilty of any abuse of his position as a lecturer of the government college. accordingly he was acquitted of the charges.8. learned add). standing counsel conceded that an employee of a co-operative society or a public servant working on deputation in a co-operative society is not a public servant. but in the case at hand appellant no. 1 who was an i.p.c. and as such a public servant, was not an employee under the co-operative society nor he was deputed there. he was kept in dual charge of i.p.c. and managing director of the co-operative society. in the decision state of gujarat (supra) dwivedi was a lecturer of a government college and he was appointed by gujarat university as examiner to value the answer scripts and it was alleged that in the capacity of examiner he obtained illegal gratification. he was appointed as an examiner, not because he was a lecturer in a government college, but because of his qualification. but here in the present case appellant no. 1 was kept in charge of managing director since he was i.p.c. of dhankauda block. so, the decisions cited above cannot be applicable to the present case. accordingly learned addl. standing counsel urged that the argument advanced by learned counsel for appellant no. 1 ought not to be accepted.no doubt appellant no. 1 was in dual charge of i. p.o. and managing director of the co-operative society. but there is nothing in the evidence on record to show that an i.p.c. alone can remain in charge of the managing director of the co-operative society. in other words, there is no evidence indicating that no one other than an i.p.c. can remain in charge of the managing director of the co-operative society. so appellant no. 1 cannot be liable for the offence under section 5(2) read with section 5(1)(c) and 5(1)(d) of the p.c. act.9. with regard to the offence under section 409 of ipc, it transpires from the evidence of p.w.2, the inspector of co-operative societies, audit, bargarh that he audited the co-operative society, for the period 3.2.1986 to 12.3.1986, during which time appellant no. 1 was in charge of managing director thereof. after conducting a detailed audit and perusing the entry in the stock register and making physical verification of the stock, he came to know that there was shortage of sand, worth rs. 100/-, coal worth rs. 3110.32 and bricks worth rs. 2400/- and dead stock of rs. 280/-. learned counsel for the appellant no. 1 submitted that the audit report itself would not be sufficient to bring home the charge of misappropriation. in support of his submission he relied on the decision in the case of state of orissa v. shyamsundar rath and anr. 1984 (ii) olr 677 where it has been held by this court that entries in the books of account, though relevant, would not alone be sufficient evidence to charge any person with criminal misappropriation. but in the present case/besides the audit report witnesses have been examined to establish the charge levelled under section 409 of ipc against the appellant no. 1. so the decision cited above cannot be applicable to the present case.10. it transpires from the evidence of p.w.3, the successor of appellant no. 1 that he took over charge from appellant no. 1 and the taking over continued for three months and the charge list was finally prepared and signed on 21.11.1985 as per ext. 2. by the time he took over charge on 21.11.1985 there was no stock of coal or bricks in the co-operative society. during cross-examination it was elicited from him that various raw materials, like coal and bricks were necessary for the purpose of manufacturing tiles and it was recurring process. the tile factory was running and tiles were being manufactured during the period 5.8.1985 to 21.11.1985. he further stated that the stock mistry-dolagovinda barad, who was in charge of making tiles, was competent to say that quantity of brick and coal used during the relevant period. so mr. mund, learned counsel for the appellant no. 1 submitted that there was no evidence as to what exactly was the physical stock of bricks and coal on 5.8.1985, when appellant no. 1 ceased to be the managing director of the co-operative society and the quality of bricks and coal used for manufacturing of tiles during the period 5.8.1985 to 21.11.1985. admittedly there is no evidence to show the stock of bricks and coal on 5.8.1985 when appellant no. 1 ceased to be the managing director of the co-operative society. dolagovinda barad, the stock mistry was the competent person say about the quantity of bricks and coal used in manufacturing of tiles during the period 5.8.1985 to 21.11.1985, but his examination was withheld for the reasons best known to the prosecution. learned trial court in this respect held that it was the duty of the appellants to examine dolagovind barad to prove that the balance stock of bricks and coal were in fact used for the manufacturing of tiles during the period 5.8.1985 to 21.11.1985 which was erroneous. burden of proof of establishing all the ingredients of section 409 of ipc such as entrustment, misappropriation, dishonest intention etc. lies on the prosecution. in the present case, it was for the prosecution to prove that the stock in question was misappropriated by the appellant no. 1. it was not the duty of said appellant to prove his innocency. when prosecution failed to prove that the appellant no. 1 misappropriated the stock, the trial court ought not have convicted him for the offence under section 409 of ipc, particularly when it was his plea that the stock of bricks and coal was exhausted in manufacturing tiles during the period 5.8.1985 to 21.11.1985, which could not be disproved.11. as regards the offence under section 467 of ipc, it transpires from the evidence of p.w. 1, the owner of the truck bearing registration number ors 9398 that dinabandhu sahu was never a driver of the said truck and that he never transported bricks in his truck. he specifically deposed that he did not transport any brick to the co-operative society. he further stated that sometimes he accompanied the truck to different places. whenever he was not in the truck and payment was made towards hire charge, his staffs used to receive the same and subsequently pay it to him. during cross-examination he failed to say the name of the drivers engaged by him in the said truck in different years. he also failed to say on which date his truck carried what goods and to which places. so, learned counsel for appellant no. 1 submitted that when p.w.1 was unable to say as to on which date his truck carried what goods and to which places and as per his evidence when he sometimes receives hire charge from his staff, the possibility that the truck in question was used in carrying the bricks without his knowledge, cannot be ruled out. similarly when he failed to name the different drivers engaged in his truck in different years, his evidence that dinabandhu sahu was never his driver, cannot be accepted, particularly when the latter was not examined. learned addl. standing counsel in this context submitted that the whereabouts of dinabandhu sahu could not be ascertained, which shows that it was fictitious name. but there is nothing in the evidence of p.w.5, the i.o. to show that he made any attempt to search for said dinabandhu sahu. moreover it can be judicially noticed that dinabandhu sahu is a common name and it does not inspire confidence that no person bearing the name dinabandhu sahu could be traced out in sambalpur. so, it also casts a doubt as to whether the voucher, ext. 4 was a genuine or a forged one. accordingly, it is held that prosecution failed to establish the offence under section 467 of ipc against appellant no. 1 to the hilt. when prosecution failed to prop up the charge under sections 5(2) read with section 5(1)(c) and 5(1)(d) of p.c. act and section 409/467 of ipc against the appellant no. 1, appellant no. 2 cannot be held guilty under section 5(2) read with section 5 (1)(c)/5(1)(d) of p.c. act and section 409/467 of ipc all read with section 109 of ipc. the trial court without considering the evidence on record in its true perspective convicted the appellants under the sections they were charged with erroneously.in the result, both the criminal appeals are allowed and the judgment and order of conviction and sentence passed by the trial court against the appellants in t.r. case no. 13 of 1988 are hereby set aside.