Smt A.gayathri Devi

IN THE COURT OF THE PRINCIPAL SPECIAL JUDGE FOR C.B.I.

CASES, VISAKHAPATNAM.

Present: Smt. A. GAYATHRI DEVI, Prl. Spl. Judge for C.B.I. Cases, Visakhapatnam.

Wednesday, this the 28th day of February, 2018

C.C.No.2/2007

Between:

State represented by Inspector of Police, SPE, CBI, EOW, Chennai. …Complainant

And:

1. Sanjay P. Jain, s/o Padam Chand Jain, aged 27 years, Proprietor of M/s. Satyam Impex (Accused No.1) (Case against A.1 is separated as CC.4/07 on 18.7.2007)

2. Bhagwan Tulsian, s/o late Murari Lal, aged 58 years, Proprietor of M/s. Ganesh Overseas Inc (Accused No.2) (Case against A.2 abated on 12.9.2017)

3. Anil Kumar Gupta, s/o M.P. Gupta, aged 54 years, Proprietor, M/s. Paramhans Trading Company, CP-103, Ground Floor, Maurya Enclave, Pitampura, Delhi r/o CU- 140, Visakha Enclave, Pitampura, Delhi-34. (Accused No.3)

4. Narendra Kumar, s/o Ram Gopal, aged 36 years, Proprietor of M/s.Prerna International (India) No.1/37, Lalita Park, Laxmi Nagar, Delhi, r/o No.29, Old GeethaColony,Delhi-31. (Accused No.4)

5. Dinesh Kumar Jain, s/o Jai Prakash Jain, aged 36 years, Proprietor of M/s.Laxmi Enterprises, A-44, Friends Colony (East), Delhi-65 & r/o No.RZ-132/II, Sadh Nagar, Palam Colony, New Delhi- 110045. (Accused No.5) 2C.C.2/2007/Prl. CBI

Court/VSP

6. Surender Kumar Aggarwal, s/o Ram Kumar Aggarwal, aged 46 years, Proprietor of M/s.Lord Empire International, Bristro Complex Building, House No.12, II Floor, Hauz Khas village, New Delhi-16 & r/o No.J-51, Kalkaji, New Delhi-110019.(Accused No.6)

7. Harish V. Talreja, s/o late Vishidas Talreja, aged 40 years,, the then employeeofM/s.Sainath Forwarders (CHA No.11/1029), r/o No.A-1, 104, Kalpak Estate, Antop Hill, Wadala Koliwada, Mumbai-37. (Accused No.7)

8. Mushtaq Ahmed Choudhary, s/o Ismail Choudhary, aged 38 years, the then UDC, New Custom House, Mumbai, r/o No.3/B, Besant Mahal, Wadala (East), Mumbai-37. (Accused No.8)

9. Sajid K Khan, s/o Kadhir Khan, aged 32 years, the then LDC, JawaharlalNehruCustom House,NhavaSheva, Maharashtra & r/o Sun Plaza, Room No.202, Plot No.149/150, Sector-21, Nerul, Navi Mumbai- 706 (Accused No.9)

10. Deepak Narayan More, s/o Narayan Shankar More, Custom House Agent (private) at JNCH, Sheva & r/o No.45, 4th Floor, Dosti Apartment, Road No.22, Kishan Nagar No.3, Wagale Estate, Thane, Maharashtra- 400604. (Accused No.10)

11. Vedam, Kurla Maharashtra (Accused No.11) (Case against A.11 is deleted as per orders in

Crl.M.P.645/08 dated 2.4.09)

12. Sandeed Joshi, s/o Bhavani Shankar, aged 39 years, Lakshmi Sadan, Zaver Road, Muland West, Mumbai-80(Accused No.12) 3C.C.2/2007/Prl. CBI

Court/VSP

13. Jitendra Ramachandra Padte, s/o late Ramachandra, aged 32 years, Custom Sepoy No.60, Jawaharlal Nehru Custom House, Nhava Sheva, Maharashtra & r/o Uran Bori-Mira Road, near InamdarNagar,Uran-Bori, District Raighad (Accused No.13).

14. Nitin Kaginkar, s/o Babu Ram Kaginkar, aged 27 years, private Custom House Agent doing work at Jawaharlal Nehru Custom House and r/o Nhava Sheva Jawaharlal Nehru Port Trust Guest House Quarters, Nhava Sheva (Accused No.14).

15. Shivom Kumar, s/o Ram Gopal, aged 29 years, Proprietor of Shree Sakshi Impex, C-13, Mahendru Enclave, Gurudwara Road, Delhi & r/o No.29, Old GeethaColony,Delhi-31. (Accused No.15).

16. Rajan Gupta, s/o Anil Kumar Gupta, aged 27 years, Proprietor of M/s. Paramhans Exports, No.1/37, Lalita Park, Laxmi Nagar, Delhi & r/o No.CU-140, Visakha Enclave, Pitampura, Delhi-34. (Accused No.16).

(Present case is against A.3 to A.10, A.12 to A.16)

….. Accused Nos.3,4,5,6,7,8,9,10,12,13,14, 15 & 16

This case has come up on 15.02.2018 for final hearing before me in the presence of Sri A. Chennakeshavulu, Ld. Public Prosecutor for the State-Complainant and of Sri M.V. Sudhakar, Advocate for A.3 to

A.6, A.10, A.14 to A.16, Sri G.V.P.B.S.N. Murthy, A.7 to A.9 and A.12 and

Sri T.V. Sastry, Advocate for A.11 and the matter having stood over for consideration till this day, this Court doth the following:

J U D G M E N T

4C.C.2/2007/Prl. CBI

Court/VSP

The State represented by Inspector of Police, SPE CBI, EOW,

Chennai, filed charge sheet in R.C.1(E)/2004/CBI/EOW/Chennai against

A.1 to A.16 for the offence under secs.120-B r/w 420, 467, 468, 471, 411 & 201 of IPC and against A.8, A.9 and A.13 under sec.13(2) r/w 13(1)(d) of Prevention of Corruption Act, 1988.

2.The material averments in the charge sheet are summarized as under:

i)A.1 to A.16 have entered into criminal conspiracy during 2002- 03 at Delhi, Mumbai, Nhava sheva, Kakinada etc., to cheat Government of India and in furtherance of the said conspiracy dishonestly and fraudulently fabricated DEPB Licenses and the corresponding Transfer

Release Advices by forging the signatures of customs/DGFT (Director

General of Foreign Trade) officials affixing bogus rubber stamps and sold the same to M/s.Kedia Overseas Limited, an Importer based at

Hyderabad by deceiving them and accepted payments towards consideration for the same. The said Importer ultimately utilized the same for clearing and duty exemption for imported goods i.e., Crude palmolein through Customs House, Kakinada. Thus, Customs House,

Kakinada was put to loss to the tune of Rs.1,98,78,418/- and corresponding gain to the accused.

ii)M/s. Kedia Overseas Limited which is having customs private bonded warehouse and edible oil refinery at Kakinada during the course of their business deals purchased seven DEPB Licenses with its enclosures like TRAs., etc., from various brokers of Mumbai and Delhi on payment by way of cheques. These seven DEPB Licenses were purported to have been issued from DGFT Office, Asaf Ali Road, Delhi and from DGFT office, Church Gate, Mumbai, in the names of 5C.C.2/2007/Prl. CBI

Court/VSP

M/s.Global Exports, Mumbai, M/s. Prerna International India, New Delhi,

M/s. Sai International, Mumbai, M/s. Paramhans Exports, New Delhi,

Shree Sakshi Impex, New Delhi and M/s. Paramhans Trading Company,

Delhi. A.2 had arranged these seven bogus licenses from the blank license forms bearing Nos.OA 286518, OA 286528, OA 286530, OA 286538, OA 286539, OA 286545 and OA 285781 which were part of the license forms missing from DGFT Office, Udyog Bhavan,

New Delhi, during the period 2000-2001. A.2 fabricated and forged the seven DEPB licenses in the said names and the corresponding TRAs., in the names of Importer M/s.Kedia Overseas Ltd., Hyderabad, as if

Exports were made by these firms from Nhava sheva, Maharashtra, for the purpose of committing the fraud and illegal gain.

iii)Further the firms M/s.Sakshi Impex, M/s.Paramhans Exports, M/s.

Paramhans Trading Company and M/s. Prerna International India, all

Proprietorship concerns based at Delhi were dishonestly floated by A.2 with connivance of his relatives A.15, A.16, A.3 and A.4, respectively though there was no genuine business of Exports/Imports carried out by them. The remaining two bogus DEPB licenses arranged by A.2 with active connivance of A.1 in the names of other two firms namely

M/s. Global Exports, Mumbai and M/s.Sai International, Mumbai which are bogus and fictitious firms and the sale proceeds of these DEPB licenses received through cheque payments from M/s.Kedia Overseas

Ltd., Hyderabad, were encashed by A.2 with the help of A.1 who opened accounts dishonestly in the names of M/s.Satyam Impex and

M/s.Sai International at Mumbai only for encashing these cheques.

iv)A.2 had dishonestly and fraudulently arranged forgery of the said DEPB Licenses and the corresponding TRAs., with the help of the 6C.C.2/2007/Prl. CBI

Court/VSP then officials A.8, UDC of New Customs House, Mumbai and A.9, LDC of Jawaharlal Nehru Customs House, Nhava sheva and others. The said documents which were given to A.8 for fabrication in the guise of registration/verification by A.2 were handed over to A.9 with a request to get the said licenses fabricated as if it was registered/verified at

Nhava Sheva Customs House using his influence for making the documents look genuine and for generating bogus TRAs., for the forged licenses. A.9 arranged fabricated and forgery of the questioned licenses with the connivance of A.10, A.12, A.11, A.7 etc. Finally, these completed forged licenses and T.R.As., were received by A.2 and sold to M/s.Kedia Overseas Limited through various brokers. These liceses and T.R.As., were submitted and got released. The customs House,

Kakinada, then cleared the goods by debiting the total value of

Rs.1,98,78,418/-.

v)A.8 after arranging forgery and fabrication of documents in connivance with A.14 stolen TRA registers pertaining to the relevant period on the night of 18.4.2003 with Customs Sepoy No.60, A.13 who was on security duty in the night of 18.4.2003, to guard PUB (Port

Users Building), Customs Office apart from guarding the control room of Jawaharlal Nehru Customs House for destruction of evidence. A.13 while he was on duty during that night has abused his official position as public servant and facilitated A.9 and A.14 to enter Customs House for removal of relevant TRA Registers pertaining to the questioned

TRAs., involved in this case from the correspondence section of license section. Thus all the accused i.e., A.1 to A.16 have committed offences under secs.120-B r/w 420, 467, 468, 471, 411 and 201 of IPC and 7C.C.2/2007/Prl. CBI

Court/VSP sec.13(2) r/w 13(1)(d) of P.C. Act, 1988 and substantive offences thereof.

3.On filing charge sheet case was taken cognizance against A.1 to

A.10 and A.12 to A.16 for the offence punishable under secs.120-B, 420, 467, 468, 471 r/w 465 and 411 of IPC and against A.8, A.9 and

A.13 under sec.13(1)(d) r/w 13(2) of PC Act, 1988 and NBWs., were issued against A.1,5,6 and 12 since they were shown as absconding in the charge sheet and summons were issued to A.2, A.3, .4, A.7 to A.10 and A.13 to A.16. On their appearance copies were furnished.

4.Case against A.1 is separated as CC.4/07 on 18.7.2007. Name of

A.11 is deleted from charge sheet on 2.4.2009 as per orders in

Crl.M.P.645/08 as fictitious person.

5.Upon hearing both sides, charges under secs.120-B and 420 of

IPC against A.2 to A.10, A.12 to A.16, under secs.467, 468 of IPC against A.2, under sec.471 of IPC against A.2 to A.4, A.7 to A.10, A.12 to A.16, under sec.201 r/w 34 of IPC and 411 r/w 34 of IPC against A.8,

A.9, A.13 and A.14 and under sec.13(1)(d) r/w 13(2) of P.C. Act, 1988 against A.8, A.9 and A.13 were framed read over and explained to them for which they pleaded not guilty and claimed to be tried.

6.Case against A.2 was abated on 12.09.2017. Hence, this case is against A.3 to A.10, A.12 to A.16 only.

7.On behalf of prosecution PWs.1 to 72 were examined and Exs.P.1 to P.235, P.1-A to C, P.6-A to C, P.15-A, B, P.16-A, B, P.17-A,B, P.20-A,B,

P.21-A,B, P.24-A to F, P.25-A to F, P.26-A to E, P.27-A to D, P.28-A to D,

P.29-A to E, P.30-A to E, P.62-A, P.64-A, P.65-A were marked.

8.On closure of evidence on prosecution side, accused were examined under Sec.313 Cr.P.C and they denied the incriminating 8C.C.2/2007/Prl. CBI

Court/VSP evidence and written statements were filed by A.3 to A.9,A.15 and

A.16. On behalf of accused no oral evidence is adduced and no documents are marked.

9.Heard the Ld. Counsel for accused and Ld. Public Prosecutor for prosecution. Perused the material on record and written arguments of both sides.

10.Now the points of determination are :

1. Whether non obtaining of sanction to prosecute A.8 and A.9 by CBI vitiates trial and leads to their acquittal?

2.Whether prosecution has established the offence of criminal conspiracy under sec.120-B IPC against A.2 to A.10, A.12 to A.16 beyond reasonable doubt?

3. Whether prosecution has established offence U/sec. 420 IPC against A.2 to A.10, A.12 to A.16 beyond reasonable doubt?

4. Whether prosecution has established offence U/secs.467 of IPC against A.2 beyond reasonable doubt?

5. Whether prosecution has established offence U/secs.468 of IPC against A.2 beyond reasonable doubt?

6. Whether prosecution has established the offence U/sec.471 IPC against A.2, A.3, A.4, A.7, A.8, A.9, A.10, A.12 to A.16 beyond reasonable doubt beyond reasonable doubt?

7. Whether prosecution has established the offence U/sec.201 r/w 34 of IPC against A.8, A.9, A.13, A.14 beyond reasonable doubt beyond reasonable doubt?

8. Whether prosecution has established the offence U/sec.411 r/w 34 of IPC against A.8, A.9, A.13, A.14 beyond reasonable doubt beyond reasonable doubt?

9. Whether prosecution established offence U/sec. 13(1)(d) r/w 13(2) of PC Act against A.8, A.9, A.13 and A.14 beyond reasonable doubt?

11.POINT NO.1:

i)NON OBTAINING OF SANCITON AGAINST A.8 & A.9:

a)At the outset it must be stated that as per the description of accused in inal report A.8 was working as UDC at New Customs House,

Mumbai and A.9 was working as LDC at Jawaharlal Nehru Customs

House, Nhavasheva, Mumbai. The very description of A.8 and A.9 shows that they were public servants during the relevant time. Further final report clearly mentions the obtaining of sanction for prosecution 9C.C.2/2007/Prl. CBI

Court/VSP against A.13 from the competent authority and filing of the same. In body of charge sheet also A.8 and A.9 are referred to as the then officials of New Customs House and Jawaharlal Nehru Customs House respectively.

b)Learned counsel for A.8 and A.9 assiduously argued that admittedly sanction for prosecution was not obtained against A.8 and

A.9 and even reasons for not obtaining sanction against A.8 and A.9 are not whispered in final report though it was mentioned that sanction was obtained against A.13 and additional documents would be filed at the time of trial, if required.

c)Interalia, learned Public Prosecutor submitted that because A.8 and A.9 were dismissed from service by the date of taking cognizance of the matter no sanction order was obtained against them and even otherwise after taking cognizance of the matter by Court A.8 and A.9 cannot raise the issue of non obtaining of sanction for the first time at the stage of arguments without even suggesting the same to the IO or relevant witnesses and as such, the said objection cannot be taken into consideration at the stage of arguments.

d)Learned Public Prosecutor place reliance upon Abhay Lalan Vs.

Yogendra Madhava Lal reported in 1981 Cri.L.J. 1667 wherein the

Lordships held that the question of jurisdiction shall be raised by accused before the commencement of trial as per sec.462 of Cr.P.C., and the decision regarding jurisdiction to be given on the basis of allegations made and averments contained in the complaint of the charge, as the case may be.

10C.C.2/2007/Prl. CBI

Court/VSP

e)The aforementioned decision speaks only about objections regarding the point of jurisdiction but not is mentioned about obtaining or otherwise of the sanction.

f)Learned counsel for A.8 and A.9 argued that burden is upon the prosecution to explain the reasons for non obtaining of sanction though

A8 and A.9 are public servants and A.8 and A.9 were not dismissed by the date of taking cognizance of the offence and in the absence of any evidence regarding dismissal of A.8 or A.9 from the service, prosecution shall obtain sanction for prosecution to proceed against them and they cannot keep silent without explaining anything about non obtaining of sanction order against them either in charge sheet or during the trial and even IO i.e., Murugesan did not even whisper about the reason for not obtaining sanction order against A.8 and A.9.

g)To buttress the contention of A.8 and A.9 printouts of the orders of Commissioner of Customs, New Customs House, Mumbai dated 15.7.2003 and 22.11.2006 downloaded from net were filed which clearly shows that on 15.7.2003 A.8 was suspended and on 22.11.2006 the said suspension order is revoked and A.8 is reinstated in to service with effect from the date he resumes his duties and the said order was passed without prejudice to the outcome of disciplinary proceedings or any other proceedings that has been initiated or may be initiated against A.8 and print out of memorandum dated 20.1.16 directing A.9 to report to the duty at New Customs House on the ground that he was unauthorizedly absent from duties since 2.5.2011 till that date.

h)Learned counsel for A.8 and A.9 placed reliance upon the following decisions of Hon’ble Apex Court in this connection.

11C.C.2/2007/Prl. CBI

Court/VSP

1. In Nanjapa Vs. State of Karnataka reported in 2016(2) SCC (Crl.) 360 wherein the Lordships held that :

“A plain reading of sec.19(1) P.C. Act leaves no manner of doubt that the same is couched in mandatory terms and forbids Courts from taking cognizance of any offence punishable under sec.7,10,11,13 and 15 against public servants except with the previous sanction of competent authority.”

Learned counsel for A.8 and A.9 relied upon the following observations of the Lordships in paras 23.2 and 23.4 of the Judgment.

“23.2. A careful reading of sub-section (3) to section 19 would show that the same interdicts reversal or alteration of any finding, sentence or order passed by a Special Judge, on the ground that the sanction order suffers from an error, omission or irregularity, unless of course the Court before whom such finding, sentence or order is challenged in appeal or revision is of the opinion that a failure of justice has occurred by a reason of such error, omission or irregularity. Sub-section (3), in other words, simply forbids interference with an order passed by the

Special Judge in appeal, confirmation or revisional proceedings

on the ground that the sanction is bad save and except, in cases where the appellate or revisional Court finds that failure of jusitsce has occurred by such invalidity. What is note worthy is that sub-section (3) has no application to proceedings before

Special Judge, who is free to pass an order discharging the

accused, if he is of the opinion that a valid order sanctioning prosecution of the accused had not been produced as required under Section 19(1).” “23.4 The language employed in sub-section (3) is, in our opinion, clear and unambiguous. This is, in our opinion, sufficiently evident even from the language employed in sub- section (4) according to which the appellate or the revisional

Court shall, while examining whether the error, omission or irregularity in the sanction had occasioned in any failure of 12C.C.2/2007/Prl. CBI

Court/VSP justice, have regard to the fact whether the objection could and should have been raised at an early stage. Suffice it to say, that a conjoint reading of sub-sections 19(3) and (4) leaves no manner of doubt that the said provisions envisage a challenge to the validity of the order of sanction or the validity of the proceedings including finding, sentence or order passed by the

Special Judge in appeal or revision before a higher court and not

before the Special Judge trying the accused.”

i)In the light of these rival contentions a careful scrutiny of material on record shows that on 9.3.2007 itself Court took cognizance of the matter against accused including A.8 and A.9. Though it is a fact that charge sheet do not whisper anything about obtaining or otherwise of the sanction to prosecute A.8 and A.9 it referred to obtaining of sanction against A.13. Interestingly except at the time of submitting defence arguments, A.8 and A.9 neither challenged the order of taking cognizance of matter against A.8 and A.9 nor questioned the sanction authority or P.W.70/IO about the same and kept silent from 9.3.2007 (date of taking cognizance) till the date of defence arguments on 8.2.2018 and canvassed that suspension orders against A.8 and A.9 were revoked and by the date of taking cognizance they were very much in service and non obtaining of sanction leads to the acquittal. A.8 and A.9 ought to have raised this objection at an early stage. No endeavour was made by A.8 and A.9 to get the net print outs regarding their alleged continuance in service by the date of taking cognizance of the matter marked by examining them and to make them part of record.Since learned Public Prosecutor submits that A.8 and A.9 were dismissed from service by the date of taking cognizance by the Court and A.8 and A.9 now contend that they are very much in service at that time and filed net printouts in that 13C.C.2/2007/Prl. CBI

Court/VSP connection, this is an important issue of fact regarding crucial point of sanction to be decided on adducing evidence only but not on simple hearing.

j)Interestingly at 4.45 .m., on 27.2.2018 which is only one day prior to the date of judgment i.e., 28.2.2018, without giving notice to other side prosecution filed memo enclosing mere photocopy of orders datd 1.5.13 and 29.2.16 of Addl. Commissioner of Customs, Mumbai, dismissing A.8 and A.9 from service. As per photocopy of order dated 1.5.13 in respect of disciplinary proceedings against A.8, he was ordered to be dismissed from service with effect from 2.5.2013. It further mentions that A.8 was under suspension from 5.4.07 to 23.5.2011.

k)Further, as per photo copy of proceedings dated 29.2.16 against

A.9, he was ordered to be dismissed with immediate effect i.e., 29.2.2016.

l)Admittedly, the photocopies of documents filed by prosecution and A.8 and A.9 did not become part of the record and as such they do not merit consideration of the Court as per law.

m)Hence, for all the aforementioned reasons of non challenging the order of taking cognizance of the matter against A.8, A.9, non raising the issue of sanction at any time for ten long years except in defence arguments, non examining any witness including A.8 and A.9 to mark the revocation orders and non suggestion of this plea to sanction authority or P.W70/IO neither vitiates trial against A.8 and A.9 nor leads to their acquittal on the ground of absence of sanction. Hence, I do not 14C.C.2/2007/Prl. CBI

Court/VSP find any force in the argument of counsel for A.8 and A.9 and accordingly answered Point No.1 against A.8 and A.9.

12.POINTS NO.2 AND 3:

Since matter to be covered under points 2 and 3 is almost interrelated, it would be convenient to discuss together points 2 & 3 regarding offences under sec.120-B and sec.420 IPC against A.2 to

A.10, A.12 to A.16.

1)PROSECUTION CASE:

a)The brief exposition of case of prosecution is as follows:

A.1 to A.16 have entered into criminal conspiracy during 2002-03 at Delhi, Mumbai, Nhava Sheva, Kakinada etc., to cheat Government of

India and in furtherance of the said conspiracy dishonestly and fraudulently fabricated DEPB licenses and corresponding TRAs., by forging the signatures of Customs/DGFT officials affixing bogus rubber stamps and sold the same to M/s.Kedia Overseas Limited, an importer based at Hyderabad by deceiving them and accepted payments as consideration for the same and ultimately the said importer utilized the same for clearing and duty exemption for imported goods through

Customs House, Kakinada and thus, caused loss to the tune of

Rs.1,98,78,418/- to the Customs House, Kakinada and corresponding gain to the accuse.

b)It is further case of prosecution that the firms namely M/s.Shree

Sakshi Impex, M/s. Paramhans Exports, M/s. Paramhans Trading

Company and M/s.Prerna International India based at Delhi, were 15C.C.2/2007/Prl. CBI

Court/VSP dishonestly floated by A.2 with active connivance of his relatives A.15,

A.16, A.3 and A.4 to commit the fraud alleged though there was no genuine business of Exports/Imports carried out by them.

c)The procedure adopted for forging and fabricating DEPB Licenses and TRAs., as per Final report is as follows:

d)A.2 arranged these seven bogus licenses in the names of the said firms from the blank license forms bearing Nos. OA 286518, OA 286528, OA 286530, OA 286538, OA 286539, OA 286545 and OA 285781 which were part of the license forms missing from DGFT office from Udyog Bhavan, New Delhi during the period 2000-2001 and A.2 fabricated and forged the said seven DEPB Licenses in the names of the said firms and the corresponding TRAs., in the name of the

Importer M/s.Kedia Overseas Limited, Hyderabad, as if Exports were made by these firms from Nhava Sheva, Maharashtra for the purpose of committing the fraud and illegal gain and out of the said firms A.2 dishonestly floated the proprietorship concerns namely M/s.Sri Sakshi

Impex, M/s. Paramahans Exports, M/s. Paramahans Trading Company and M/s. Prerna International India with active connivance of his relatives A.15, A.16, A.3 and A.4 respectively and the said firms are not doing genuine business of Exports/Imports and the remaining bogus

DEPB Licenses were arranged by A.2 with the active connivance of A.1 in the name of other two bogus and fictitious firms namely M/s.Global

Exports, Mumbai and M/s. Sai International, Mumbai and sale proceeds of these licenses were received through cheque payments from

M/s.Kedia Overseas Limited, Hyderabad, and encashed by A.2 with the help of A.1 who opened the account dishonestly in the names of 16C.C.2/2007/Prl. CBI

Court/VSP

M/s.Satyam Impex and M/s. Sai International at Mumbai for encashing these cheques.

e)It is also the case of prosecution that A.2 dishonestly and fraudulently arranged forgery of DEPB Licenses and corresponding

TRAs., with the help of the then Customs staff A.8 and A.9 and A.8 handed over the documents given to him to A.9 who was working at

JNCH, Nhava Sheva with a request to get the DEPB Licenses fabricated as if they were registered/verified at Nhava Sheva Customs House using his influence and A.9 then in connivance of A.10, A.12, A.11, A.7 for arranging fabrication and forgery of the said licenses and TRAs., and finally A.2 received this forged DEPBs., and TRAs., and sold them through various brokers to M/s.Kedia Overseas Limited and A.8 in connivance with A.14 stolen the TRA Registers pertaining to the relevant period on the night of 18.4.2003 with the help and connivance of Customs Sepoy No.60/A.13 who was on Secuirty duty at that time to guard PUB (Port Users Building), Custom Office, apart from guarding the control room of JNCH for destruction of evidence and accordingly A.13 facilitated A.8 and A.14 to enter Custom House for removal of TRAs., in this case from correspondence Section of License

Section.

2)DEFENCE:

a)A.3 to A.6, A.15 and A.16 assailed the case of prosecution on the following grounds:

i) A.3 to A.6, A.15 and A.16 are innocent and they are falsely implicated in this case; 17C.C.2/2007/Prl. CBI

Court/VSP ii)On the same subject matter crime was registered by Customs prior to registration of crime in this case and two parallel investigations cannot take place on same issue; iii)Prosecution tried to suppress the truth with a view to save Kedia

Overseas Ltd., K.P.Singh, Arun Gupta, Tarachand, Rajesh Chopra and officials of Meerut Corporation Bank; iv) A.2 himself operated the accounts opened by them and they do not know about money transactions relating to this case; and

v)Original DEPB licenses and TRAs., are not produced by prosecution.

Defence of A.10 and A.14 is mainly as follows:

i)They are innocent and falsely implicated in this case; and ii)No separate overtacts alleged against A.10 and A.14.

b)Defence of A.7 to A.9, A.12 and A.13 will be dealt with separately at the stage of discussion about their complicity.

3)LAW ON THIS ASPECT:

a)At this juncture it is necessary to focus upon the essential ingredients of Secs.120-B and 420 IPC.

1. Sec.120-B IPC Essential ingredients:

The essence of criminal conspiracy is an agreement to do an illegal act and such an agreement can be proved either by direct evidence or by circumstantial evidence or by both and in a matter of common experience that direct evidence to prove conspiracy is rarely available. Accordingly, the circumstances proved before and after the occurrence have to be considered to decide about the complicity of the 18C.C.2/2007/Prl. CBI

Court/VSP accused. Even if some acts are proved to have been committed, it must be clear that they were so committed in pursuance of an agreement made between the accused persons who were parties to the alleged conspiracy Inferences from such proved circumstances regarding the guilt may be drawn only when such circumstances are incapable of any other reasonable explanation. In other words, an offence of conspiracy cannot be deemed to have been established on mere suspicion and surmises or inference which are not supported by cogent and acceptable evidence.

2. Sec.420 IPC Essential ingredients:

i)The essential ingredients of the offence of ‘cheating and dishonestly inducing the delivery of property’, punishable under section 420 IPC., are as follows:

(a)A person cheats;

(b)He thereby dishonestly induces the person deceived –

(i) to deliver any property to any person, or

(ii) to make other or destroy the whole or any part of a valuable security or anything which is signed or sealed and which is capable of being converted into a valuable security.

b)From a plain reading of the above ingredients, it is obvious that for conviction under section 420 IPC, prosecution must be able to prove that the complainant parted with his property acting on a representation which was false to the knowledge of the accused; that the accused had dishonest intention from the outset and that the property in the hands of the person cheated must have passed on to the person who cheats. In other words, the offence of cheating and dishonestly inducing the delivery of property was complete as soon as the property was handed over to the accused.

19C.C.2/2007/Prl. CBI

Court/VSP

c)To buttress the contention of prosecution regarding sec.120-B and 420 of IPC and appreciation of evidence, learned Public Prosecutor placed reliance upon the following rulings of various Courts:

1. Mir Nagvi Askari Vs. CBI in Crl.Appeal No.1525, 1526/2004

dated 7.8.2009 wherein the prosecution drawn the attention of Court

to the following para about principles of conspiracy:

“A conspiracy is hatched in secrecy and it is difficult, if not impossible, to obtain direct evidence to establish the same. The manner and circumstances in which the offences have been committed and the accused persons took part are relevant. For the said purpose, it is necessary to prove that the propounders had expressly agreed to it or caused it to be done, and it may also be proved by adduction of circumstantial evidence and/or by necessary implication.”

2. State of Himachal Pradesh Vs. Lekhraju and another reported in 2000 (1) ALD (Crl.) 43 SC wherein it was held that :

“The traditional dogmatic, hyper technical approach has to be replaced by rational, realistic and genuine approach for administering justice in a criminal trial. Criminal jurisprudence cannot be considered as part and parcel of the human civilization and the realities of life. The Courts cannot ignore the erosion in values of life which are common feature of the present system.

Such erosions cannot be given bonus in favour of those who are guilty of polluting society and mankind.”

3.In 1991 Crl.L.J. 1269 between Babarali Ahmedali Sayed,

Appellant V. The State of Gujarat, Respondent wherein it was observed in para 15 that:

“…..it is settled law that while appreciating the evidence of a witness the court should not attach much importance to minor discrepancies which do not shake the basic version of the prosecution and should ignore the errors due to lapse of memory 20C.C.2/2007/Prl. CBI

Court/VSP or ignore those statements made by a witness under fear or confusion from imagination on the spur of the moment.”

4.Further in Mohamed Amin @ Amin Choteli Rahim Miyan

Shaikh and another Vs. CBI reported in 2008 (19) Scale 240, the

Lordships of Apex Court succinctly held that:

“For proving charge of conspiracy, it is not necessary that all the conspirators know each and every details of the conspiracy so long as they are co-participants in the main object of conspiracy.

It is also not necessary that all the conspirators should participate from the inception of conspiracy to its end. If there is unity of object or purpose, all participating at different stages of crime will be guilty of conspiracy.”

d)On the touch stone of these legal principles, case of prosecution must be tested.

4)BURDEN OF PROOF:

a)Condition precedent for holding the accused persons guilty of charge of criminal conspiracy must therefore, be considered on the anvil of the fact which must be established by the prosecution, viz., meeting of minds of two or more persons for doing or causing to be done an illegal act or an act by illegal means. Burden is upon the prosecution to establish the guilt of accused in respect of other charges also.

b)Theprinciples which can be deduced from the aforementioned judgments are, since conspiracy is hatched in secrecy and it is difficult to obtain direct evidence to establish the same, it can be inferred from the manner and circumstances in which offences are committed.

21C.C.2/2007/Prl. CBI

Court/VSP

c)Learned Public Prosecutor urged that the oral and documentary evidence placed on record by prosecution established the offence against all the accused under sec.120-B and 420 of IPC beyond reasonable doubt.

d)Interalia all accused contend that prosecution has not placed positive, cogent and tangible evidence to establish the offence under sec.120-B and 420 of IPC and they are liable to be acquitted.

e)Since it is a case of huge financial fraud involving substantial public money of Rs.1,98,78,418/- according to prosecution, it requires strict scrutiny as to facts and keen appreciation of weight of evidence for adjudication.

5)COMPLICITY OF A.3, A.4, A.5, A.6, A.15 & A.16:

a)Since case against A.1 was split up, A.2 was abated and name of

A.11 is deleted, the A.12 to A16 task of the court is to decide guilt or otherwise of A.3 to A.10, with reference to the charges from voluminous evidence on record .

b)According to the charge sheet A.3 is described as Proprietor,

M/s.Paramahans Trading Company Ltd., Mourya Enclave, Delhi and A.4 is described proprietor of M/s.Prerna International (India) Delhi, A.5 is described as Proprietor of M/s.Lakshmi Enterpirses, Delhi, A.6 is described as M/s.Lord Empire International, New Delhi, A.15 is described as Proprietor Shree Sakshi Impex, Delhi, A.16 is described as

Proprietor of M/s.Paramhans Exports, Delhi and A.2 is described as proprietor of M/s.Ganesh Overseas Inc., Shahibabad, Gahaziabad, U.P.

A.4, A.5, A.6, A.15 and A.16 are based at Delhi and A.1, A.7, A.8 to

A.10, A.13 and A.14 are based at Mumbai according to charge sheet.

22C.C.2/2007/Prl. CBI

Court/VSP

c)According to prosecution the firms M/s.Shree Sakshi Impex of

A.15, M/s.Paramhans Exports of A.16, M/s. Paramhans Traduing

Company of A.3 and M/s.Prerna International India of A.4 were dishonestly floated by A.2 with active connivance of his relatives A.15,

A.16, A.3 and A.4 and in pursuance of conspiracy to commit the fraud alledged and these firms are not doing any business of Exports and

Imports.

d)To establish the case of prosecution P.Ws.1 to 72 were examined and Exs.P.1 to P.235 were marked. None examined for defence.

6)EVIDENCE OF BANKERS RELATING TO CONSPIRACY AMONGST A.1 TO A.6, A.15 & A.16:

i)OFFICERS OF LORD KRISHNA BANK, NOIDA:

a)P.W.1/Assistant General Manager, M/s.Lord Krishna Bank,

Noida branch, during the relevant time, deposed that Ex.P.1 is account opening form of M/s.Paramhans Exports (A.16) with enclosures i.e., xerox copy of PAN in the name of A.16, xerox copy of telephone bill,

Statement of Account and request letter for closure of account and even photo of account holder is affixed in Ex.P.1 and address mentioned in the account for this proprietory firm M/s.Paramhans

Exports is 1/37, Lalitha Park, Lakshmi Nagar, Delhi-92.

b)Further, according to P.W.1 A.2 introduced A.16 who is the applicant under Ex.P.1-A opening form as M/s.Paramhans Exports (A16) and account of A.2 bearing No.1106 was opened on 30.3.2002 and A.2 signed in column of introducer Ex.P.1-B and he can identify A.2 and the said account was closed as per the request letter Ex.P.1-C of Proprietor of M/s.Paramhans Exports (A.16).

23C.C.2/2007/Prl. CBI

Court/VSP

c)A perusal of Ex.P.1 file shows that Ex.P.1-B declaration for sole proprietorship is dated 30.3.2002 and Ex.P.1-C letter requesting to close the account is dated 30.5.2003 is only one year. Further Ex.P.1 file also contains Statement of Account of Paramhans Exports. Ex.P.1-C letter did not contain any reasons for seeking closure of account. As mentioned by P.W.1 Ex.P.1-B declaration for sole partnership contains the alleged signature of A.2 as introducer.

d)P.W.1 deposed that Ex.P.2 is Statement of current account of A.16

Paramhans Exports for the period from 30.3.2002 to 5.5.2003. Ex.P.3 is

D.D., dated 20.12.2002 for Rs.28,37,658/- in favour of Paramhans

Exports (A.16) payable at New Delhi and the said DD was drawn on

SBH Service Branch, New Delhi and it was presented by M/s.Paramhans

Exports (A.16) in Lord Krishna Bank according to P.W.1 and the proceeds of Ex.P.3 D.D., were credited into the account of Paramhans

Exports (A.16) through clearing and Ex.P.14 is the deposit slip in faour of M/s.Paramhans Exports for depositing the amount covered under

Ex.P.3 D.D. This evidence is in respect of amount covered under Ex.P.83

DEPB and credited into the account of A.16 and transfer of substantial amount out of that by A.16 to A.5 according to prosecution.

e)P.W.1 further deposed that Ex.P.4 self cheque dated 26.12.2002 for Rs.10 lakhs issued by Proprietor of Paramhans Exports (A.16) and on the reverse of Ex.P.4 denominations of amounts are mentioned in token of payment made in cash and Ex.P.5 is cheque dated 27.12.2002 for Rs.18,00,000/- issued by Proprietor Paramhans Exports (A.16) in favour of Lakshmi Enterprises (A.5) which is also maintained in the same Branch. Exs.P.3 to P.5 transaction details are clearly reflected in

Ex.P.2 statement of account as mentioned by P.W.1.

24C.C.2/2007/Prl. CBI

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f)In respect of A.15 Proprietorship concern i.e., Shree Sakshi

Impex, P.W.1 deposed that Ex.P.6 file contains account opening form in the name of M/s.Shree Sakshi Impex dated 25.6.2002 with enclosures i.e., Photo copies of PAN card in the name of A.15, telephone bill and

Statement of account and request letter for closure of account and photo of account holder is affixed in the account opening form i.e.,

Ex.P.6-A and the said account holder was introduced by A.2 who is the account holder of Current Account No.1581 and in Ex.P.6-B declaration for sole proprietorship firm, A.16 signed and A.2 signed in the column of introducer and the said account was closed on 5.5.2003 on the request of the account holder through Ex.P.6-C letter addressed to

Assistant General Manager, Lord Krishna Bank Ltd., and Ex.P.7 is certified copy of Statement of account of M/s.Shree Sakshi Impex (A.15).

g)In respect of this account P.W.1 deposed that Ex.P.8 and P.9 D.Ds, for Rs.9 lakhs each drawn on Corporation Bank, Delhi, in favour of

M/s.Shree Sakshi Impex (A.15) payable at New Delhi was presented by

M/s.Shree Sakshi Impex in that Bank and proceeds were credited in the account of M/s.Shree Sakshi Impex (A.15) on clearance and Ex.P.10

D.D., dated 27.12.2002 for Rs.8,71,395/- drawn on Corporation Bank,

Delhi, in favour of M/s.Shree Sakshi Impex was also presented in that

Bank and the proceeds were credited to the account after clearance and Exs.P.11 and P.12 cheques dated 1.1.2003 and 20.2.2003 for

Rs.11,50,000/- and Rs.25,000/- respectively were issued by Proprietor

M/s.Shree Sakshi Impex in favour of Lord Empire International (A.6) and

S.B. Tulsian (A.2) respectively and A.6 and A.2 also had account in the same Bank and the amount covered under the cheques was paid and 25C.C.2/2007/Prl. CBI

Court/VSP denomination was mentioned on the reverse of Ex.P.12 and Ex.P.13 cheque was issued by M/s.Shree Sakshi Impex (A.15) in favour of self for Rs.15 lakhs and amount was paid by cash and denomination was mentioned on the reverse of Ex.P.13. This evidence is in respect of the part of the amount covered by Exs.P.82 and P.84 DEPB licenses into the account of A.15 and transfer of substantial amount by A.15 to the account of A.2 and A.6 according to prosecution.

h)P.W.1 deposed as follows in respect of proprietary concerns of

A.15 and A.16 :

“In respect of current accounts maintained by M/s.Paramhans

Exports and Shree Sakshi Impex even by perusing the bank transactions these firms did not make any exports and no foreign exchange received through these accounts.”

i)In addition to the aforementioned admission, Ex.P.6 file of A.15 shows that the account of M/s.Shree Sakshi Impex was opened on 25.6.2002 and closed on 5.5.2003 i.e., nearly after one year on the request letter of the said proprietor i.e., A.16 under Ex.P.6-C and Ex.P.8 to P.10 D.Ds., through which huge amounts were credited into the account of Shree Sakshi Impex through the D.Ds., drawn on

Corporation Bank, Delhi on clearance shows that they are of the same

date 27.12.002 i.e., six months after opening the account and Ex.P.11

cheque shows the date 1.1.2003 and nearly within six months after

Exs.P.8 to P.13 transactions account was even closed.

j)Regarding A.6 account, P.W.1 further deposed that Ex.P.15 is the file of M/s.Lord Empire International of A.6 which contains the Ex.P.15-A

Account opening form of M/s.Lord Empire International Proprietor

Surender Kumar Agarwal (A.6) and Ex.P.15-B declaration for sole 26C.C.2/2007/Prl. CBI

Court/VSP proprietorship firm shows that the said account was introduced by A.2 who had account in the same Bank. Ex.P.15-B shows the alleged signature of A.2 in the introducer's column and photo of account holder is affixed in Ex.P.15-A account opening form. Even photo copies of PAN of A.6, Lease Agreement were enclosed to the account opening form.

Ex.P.19 is comptuerized statement of M/s.Lord Empire International.

k)Regarding A.5 account in the name of M/s.Lakshmi Enterprises,

P.W.1 deposed that Ex.P.16 contains Ex.P.16-A Account opening form of applicant M/s.Lakshmi Enterprises, Proprietor as Dinesh Jain (A.5) and according to Ex.P.16-B declaration for sole proprietorship firm A.2 signed under the colum of introducer and along with account opening form the enclosures such as photocopy of PAN in the name of A.5,

Importer and Exporter Code certificate, were enclosed apart from affixing photo of account holder. Ex.P.18 is computerized copy of statement of Lakshmi Enterprises (A.5).

l)With regard to account of A.2 himself, P.W.1 deposed that Ex.P.17 is the account opening form in the name of M/s.Ganesh Overseas Inc.

with enclosures such as photocopy of Importer Exporter Code certificate and Ex.P.17-A account opening form consists of photo of the account holder A.2 and address is mentioned in the 135-A, Prakash

Industrial Area, Shahibabad, Ghaziabad, U.P. and according to Ex.P.17-B declaration of sole proprietorship firm A.2 was introduced by account holder D.D. Trading Company bearing account No.1084. He further deposed that account opening form contains photo of A.2 and he identified him.

m)Regarding A.3 P.W.1 deposed that Ex.P.20 file is the Account opening form in the name of M/s.S.K. Interworld dated 6.8.2002 in the 27C.C.2/2007/Prl. CBI

Court/VSP name of Anil Kumar Gupta (A.3) and it contains enclosures such as

Photocopy of PAN in the name of A.3 and copy of lease agreement and photo of A.3 is affixed in Ex.P.20-A Account opening form and as per

Ex.P.20-B declaration for sole proprietor ship firm A.2 who got account in the same bank signed as introducer. Ex.P.22 is computerized statement copy of S.K. Interworld.

n)P.W.1 deposed that Ex.P.21 is the account opening form of

M/s.Creative proprietor Imitiaz Khan. Ex.P.23 is computerized statement copy of Proprietor Creative and Ex.P.21-A account opening form contains introducers signature of A.2 for Ganesh Overseas Inc.

o)After deposing about all these accounts, P.W.1 categorically admits as follows at page No.10:

“A.2 used to come frequently to our Bank for most of the transactions in the above mentioned accounts Sri Sakshi Impex,

M/s.Paramhans Exports, M/s.Lord Empire International, M/s.Sri

Lakshmi Enterprises for depositing the amounts by way of D.Ds., and withdrawals. The account holders of the above said firms were known and they are the relatives of A.2. The transactions as per the Statement of accounts show frequent transfer of money from one account to another account.”

p)The next important witness in respect of these account is

P.W.2/Ajay B., who worked as Assistant Manager in M/s.Lord Krishna

Bank, Noida from February, 2001 to April, 2004. He signed as Assistant

Manager in Ex.P.6-A account opening form in respect of Shree Sakshi

Impex (A.15), Ex.P.16-A account opening form of Lakshmi Enterprises (A.5), Ex.P.17-A account opening form of A.2, Ex.P.20-A account opening form of M/s.S.K. Interworld (A.3), Ex.P.21-A account opening form of M/s. Creative Proprietor Imitiaz Khan and Ex.P.1-A account 28C.C.2/2007/Prl. CBI

Court/VSP introduced by A.2 were opened in his presence after signing by the proposed account holders and except in Ex.P.17-A which is the own account of A.2 for all the accounts, A.2 signed as introducer in his presence and he authorized the accounth holders to open the accounts and signed as Assistant Manager and in respect of Ex.P.17-A account in the name of M/s.Ganesh Overseas Inc., proprietor Sri Bhagwan Tulsian (A.2), Proprietor of D.D. Trading Company signed as introducer in his presence and A.2 personally came to him and opened the said account in his presence by affixing the photo.

q)Exs.P.11 to P.13 cheques issued by A.15 of M/s.Shree Sakshi

Impex contains the signatures of A.15.

r)He further deposed as follows in respect of these accounts at pages 3 and 4:

“Exs.P.2, P.7 accounts do not contain any Export made and foreign exchange receive transactions. Exs.P.18, P.19, P.22 and

P.23 accounts contain transactions of Import Bills.”

s)Nothing useful to the case of defence was elicited in his cross examination except that Exs.P.4, P.5,P.11,P.12 and P.13 cheques were not passed by him. In respect of those aspects P.W.1 clearly deposed and statement of accounts reflected the said transactions. Hence, even that admission is not useful to defence in any manner.

t)P.W.13/Narendra Godbole who worked as Manager in Lord Krishna

Bank, Noida Branch, from March, 2002 to July, 2002. P.W.13 deposed that Ex.P.1 account was opened in the name of M/s.Paramhans

Exports, Lalitha Park, Lakshminagar, Delhi and Proprietor is shown as

Rajan Gupta (A.16) and this account was opened during his period and he signed as Manager and authorized to open the said account on 29C.C.2/2007/Prl. CBI

Court/VSP 30.3.2002 and Ex.P.1-C letter is given by Proprietor of M/s.Paramhans

Exports/A.16 for closing the said account and Ex.P.1-B is declaration for sole proprietorship firm and Ex.P.1-A is account opening firm along with

PAN card, MTML Registration slip and statement of account and the person whose photograph is affixed in Ex.P.1-A account opening form came to bank for opening the account along with the introducer and he obtained his signature and then only he authenticated to open the account.

u)He denied the suggestions that at the time of opening Ex.P.1 account A.16 was not present before him.

v)P.W.3/Shankar P. Padhai who worked as Deputy Manager, Lord

Krishna Bank, Noida from 2001 to 2005 deposed that Ex.P.15-A is account opening form of M/s.Lord Empire International represented by its Proprietor Surendra Kumar Agarwal/A.6 and his photo was also affixed therein and A.2 introduced this account and Account holder signed in his presence and he signed as Assistant Manager authorizing to open the account and Ex.P.15-B is declaration form for sole proprietorship submitted by A.6 along with Ex.P.15-A and P.19 is

Statement of account of Lord Empire International of A.6.

w)In cross examination he denied the suggestion that Ex.P.15-A is not in accordance with KYC and RBI guidelines.

ii)CITIZEN CO-OPERATIVE BANK LTD., NOIDA:

a)P.W.4/Vineet Agarwal who worked as Branch Manager in Citizen

Cooperative Bank Limited, Noida, from 2000 to 2003 and from 2004 to 2005 at Head Office, Noida as Chief Manager deposed that his duties at that time were supervising all day-to-day transactions in the Bank 30C.C.2/2007/Prl. CBI

Court/VSP and allocation of work to staff, other administrative duties and general duties.

b)With regard to A.15 he deposed that Ex.P.24 is the account opening form in the name of M/s.Sakshi Impex (A.15) along with enclosures i.e., attested photo copy of PAN Card in the name of A.15 and thanking letter sent by the Bank for opening the account, letter of

A.15 requesting for closure of account and photocopy of telephone bill,

Ex.P.24-A account opening form and the photo of proprietor A.15 was affixed therein and account was introduced by the proprietor of

M/s.Lakshmi Enterprises namely Dinesh K. Jain (A.5) who had current account in that Bank and this account was authorized and signed by the then Assistant Manager Sri Suneeth Jindal and he signed as

Manager (operation)/Branch Head in Ex.P.24-A and Ex.P.24-B is photocopy of PAN Card of A.15 and Ex.P.24-C is notarized affidavit given by account holder for opening the current account, Ex.P.24-D is letter dated 12.6.2002 sent by Bank to M/s.Shree Sakshi Impex (A.15) conveying thanks for opening the account and the said letter was again submitted by A.15 while requesting for issue of cheque book,

Ex.P.24-E is the letter dated 5.5.2003 sent by A.15 for closure of account and he made endorsement in the said letter as 'OK' and signed which means allowing the closure of the account. Ex.P.24-F is photo copy of the telephone bill in the name of Agarwal Narender

Kumar and it was attested by A.15 as Proprietor of Shree Sakshi Impex.

c)With regard to A.3 he deposed that Ex.P.25 file relates to

M/s.Paramhans Trading Company represented by its proprietor A.3 and

Ex.P.25-A is the account opening form signed by its proprietor A.3 by affixing his photo and account was introduced by the Proprietor of 31C.C.2/2007/Prl. CBI

Court/VSP

M/s.Ganesh Overseas i.e., A.2 who had current account in that Bank and this account was authorized and signed by the Officer of the Bank and he signed as Manager (Operaton)/Branch Head and Ex.P.25-B is photocopy of PAN Card attested by the account and Ex.P.25-C is notarized affidavit given by the account holder for opening current account and Ex.P.25-D is letter of the Bank to M/s.Paramhans Trading

Company conveying thanks for opening the account and Ex.P.25-E is letter dated 10.6.2002 addressed by account holder to the Bank regarding change of address as CP-103, Ground floor, Mourya Enclave,

Pitampura, Delh and Ex.P.25-F is letter date 5.5.2003 sent by A.3 to the

Branch Manager for closure of the account and he endorsed on the said letter as 'OK' and signed.

d)With regard to A.2, P.W.4 deposed that Ex.P.26 file relates to

M/s.Ganesh Overseas Inc., represented by its proprietor Bhagwan

Tulsian A.2 and its enclosures and Ex.P.26-A is the account opening form wherein the photo of proprietor (A.2) was affixed and A.2 introduced by himself on the ground that he had current account already in that Bank and this account was authorized and signed by

Assistant Manager Nidhi Grover and he signed as Manager (operation)/Branch Head and Ex.P.26-B is photo copy of PAN card and

Ex.P.26-C is notarized affidavit given by the account holder for opening current account and Ex.P.26-D is letter of the Bank conveying thanks for opening the account and Ex.P.26-E is letter dated 8.5.2003 sent by

A.2 to the Bank for closure of account and on that letter he made endorsement as 'OK' and signed to allow the closure of account.

e)With regard to A.5, P.W.4 deposed that Ex.P.27 file is with regard to opening of account of M/s. Lakshmi Enterprises represented by its 32C.C.2/2007/Prl. CBI

Court/VSP

Proprietor Dinesh Kumar Jain (A.5) and Ex.P.27-A is the account opening form wherein photo of A.5 was affixed and the said account was introduced by A.2 who had current account in the name of M/s.Ganesh

Overseas in the Bank and this account was authorized and signed by

Nidhi Grover, the then Assistant Manager and he also signed as

Manager (Operation)/Branch Head and Ex.P.27-B is photocopy of PAN

Card attested by the account and Ex.P.27-C is notarized affidavit given by the account holder for opening current account and Ex.P.27-D is letter of the Bank conveying thanks for opening account and this letter was submitted by A.5 for seeking cheque book and on the backside of

Ex.P.27-D A.5 authorized Jitendrakumar to receive the cheque.

f)With regard to A.6, P.W.4 deposed that Ex.P.28 is the file relating to the account opening of M/s.Lord Empire International represented by its proprietor S. Surendra Kumar Agarwal/A.6 and Ex.P.28-A is the account opening form which contains the photo of A.6 and the said account was introduced by A.2 who had current in the Bank in the name of M/s.Ganesh Overseas and the said account was authorized and signed by Sumith Jindal, the then Assistant Manager and he signed as Manager (Operation)/Branch Head and Ex.P.28-B is photocopy of

PAN Card letter and Ex.P.28-C is notarized affidavit given by the account holder for opening current account and Ex.P.28-D is letter of the Bank conveying thanks for opening the account which was submitted by proprietor/A.6 for seeking cheque book.

g)With regard to A.4, P.W.4 deposed that Ex.P.29 is the file relating to the account opening of M/s.Mahalakshmi Handicrafts represented by its Proprietor Narendra Kumar/A.4 and Ex.P.29-A is the account opening form which contains the photo of A.4 and the said account was 33C.C.2/2007/Prl. CBI

Court/VSP introduced by A.3 of M/s.Paramhans Trading Company who had current in the Bank in the bank and the said account was authorized and signed by Sumith Jindal, the then Assistant Manager and he signed as

Manager (Operation)/Branch Head and Ex.P.29-B is photocopy of PAN letter and Ex.P.29-C is notarized affidavit given by the account holder for opening current account and Ex.P.29-D is photocopy of self attested ration card of A.4 and Ex.P.29-E is letter of the Bank conveying thanks for opening the account and Ex.P.29-F is letter dated 7.5.2003 addressed by A.4 to Bank for closure of account which contains endorsement as 'OK' and signed by him to allow the closure of account.

h)With regard to A.3, P.W.4 deposed that Ex.P.30 is the file relating to opening of account in the name of M/s.S.K. Interworld represented by its proprietor Anil Kumar Gupta (A.3) and Ex.P.30-A is the account opening form containing photo of A.3 and the said account was introduced by himself who had current account in the name of

M/s.Praramhans Trading company and the said account was authorized and signed by Sumith Jindal, the then Assistant Manager and he signed as Manager (Operation)/Branch Head and Ex.P.30-B is photocopy of

PAN letter and Ex.P.30-C is notarized affidavit given by the account holder for opening current account and Ex.P.30-D is letter of the Bank conveying thanks for opening the account and Ex.P.30-E is letter dated 7.5.2003 of A.3 to the Bank of closure of the account which contains endorsement as 'OK' and signed by him to allow the closure of account.

i)According to P.W.4 Ex.P.31 is the Statement of account of Shree

Sakshi Impex (A.15) Ex.P.32 is Statement of account of M/s.Paramhans 34C.C.2/2007/Prl. CBI

Court/VSP

Trading Company (A.3), Ex.P.33 is Statement of Account of M/s.Lakshmi

Enterprises of A.5, Ex.P.34 is Statement of Account of M/s.Lord Empire

International of A.6, Ex.P.35 is Statement of account of M/s.S.K.

Interworld of A.3 and Ex.P.36 is statement of account of

M/s.Mahalakshmi Handicrafts of A.3 which were attested by him as

Chief Manager by affixing the seal of the Bank.

j)P.W.4 further deposed that Ex.P.37 is the credit slip dated 2.1.2003 for Rs.26,41,061/- in respect of Shree Sakshi Impex of A.15 and it contains deposit of three instruments i.e., cheque/DD of

Corproation Bank for Rs.9 lakhs , Rs.8,41,061/- and Rs.9 lakhs in total for Rs.26,41,061/- and these instruments were deposited in the current account of Sakshi Impex of A.15 and the same is reflected in Ex.P.31 account of Shre Sakshi Impex and on the same day Rs.4,95,000/- was transferred to M/s.S.K. Interworld of A.3, Rs.4,65,000/- was transferred to M/s.Mahalakshmi Handicrafts of A.4 Rs.7,50,000/- was transferred to

M/s.Lakshmi Enterprises of A.5, Rs.4,35,000/- was transferred to

M/s.Paramhans Trading Company of A.3 and Rs.4,85,000/- was withdrawn by A.K. Gupta (A.3) in cash.

k)P.W.4 also deposed that Ex.P.38 is the credit slip dated 29.12.002 for Rs.27,91,155/- in respect of Paramhans Trading Company of A.3 and it contains cheque/DD drawn on SBH for Rs.27,97,155/- was credited into the account of M/s.Paramhans Trading Company and the said credit voucher was signed by A.2 on behalf of Account holder and

Ex.P.32 Statement of account of Paramhans Trading Company of A.3 reflects Ex.P.38 credit on 31.12.2002 and on the next day an amount of Rs.9,95,000/- was transferred to the account of M/s.Lakshmi

Enterprises of A.5, Rs.5,00,000/- was transferred to the account of 35C.C.2/2007/Prl. CBI

Court/VSP

M/s.Lord Empire International of A.6, Rs.5,00,000/- was transferred to

M/s.Mahalakshmi Handicrafts of A.4 and Rs.5,00,000/- cash was withdrawn by account holder.

l)P.W.4 further deposed that Ex.P.39 is cheque dated 31.12.2002 issued by Proprietor of M/s.Sakshi Impex of A.15 in favour of

S.K.Interworld of A.3 for Rs.4,95,000/- and as per Ex.P.39 amount was transferred to S.K. Interworld on 2.1.2003 and under Ex.P.40 cheque

dated 31.12.2002 issued by Proprietor of Shree Sakshi Impex i.e., A.15

in favour of Mahalakshmi Handicrafts of A.4 for Rs.4,65,000/- and as per Ex.P.40 amount was transferred to M/s.Mahalakshmi Handicrafts of

A.4 on 2.1.2003 and under Ex.P.41 cheque issued by proprietor of

Sakshi Impex i,.e., A.15 in favour of Lakshmi Enterprises of A.5 for

Rs.7,50,000/- and as per this cheque amount was accordingly transferred on 2.1.2003 and under Ex.P.42 cheque dated 2.1.2003 issued by proprietor of M/s.Sakshi Impex/A.15 in favour of Paramhans

Trading Company of A.3 for Rs.4,35,000/- and according to Ex.P.42 amount was transferred accordingly on 2.1.2003 and under Ex.P.43 cheque dated 2.1.2003 issued by proprietor Sri Sakshi Impex A.15 in favour of A.3 for Rs.4,85,000/- and at the back of Ex.P.43 the person in whose favour it was withdrawn acknowledged the receipt of cash.

Hence, Exs.P.9 to P.43 are the cheques issued by Proprietor Sri Sakshi

Impex (A.15( which are reflected under Ex.P.37 statement of account as per P.W.3.

m)With regard to the cheques issued by Paramhans Trading

Company of A.3, P.W.4 deposed that Ex.P.44 cheque dated 1.1.2003 was issued in favour of Lakshmi Enterprises of A.5 for Rs.9,95,000/- and Ex.P.45 cheque dated 1.1.2003 was issued in favour of Lord Empire 36C.C.2/2007/Prl. CBI

Court/VSP

International of A.6 for Rs.5,00,000/-, Ex.P.46 cheque dated 1.1.2003 was issued in favour of Mahalakshmi Handicrafts of A.4 for

Rs.5,00,000/- , Ex.P.47 cheque dated 1.1.2003 issued in favour of self for Rs.5,00,000/- and Ex.P.48 cheque dated 1.1.2003 issued in favour of A.3 for Rs.4,35,000/- and A.3 signed on the reverse of Ex.P.48 acknowledging the receipt of amount and under Ex.P.58 cheque dated 4.1.2003 for Rs.3 lakhs in favour of Lakshmi Enterprises of A.5 and under Ex.P.59 cheque dated 20.1.2003 in favour of Lord Empire

International of A.6 and all the cheques were encashed.

n)P.W.4 further deposed that under Ex.P.49 cheque dated 31.12.2002 issued by Proprietor S.K. Interworld i.e., A3 in favour of

Raju Singh for Rs.4,95,000/- which was encashed and under Ex.P.50 cheque dated 31.12.2002 issued by Proprietor, Mahalakshmi

Handicrafts of A.4 for Rs.4,65,000/- in favour Raju Singh and under

Ex.P.56 cheque dated 1.1.2003 issued by Mahalakshmi Handicrafts of

A.4 in favour of self for Rs.5 lakhs and the said cheques were encahsed.

o)With regard to the cheques issued by proprietor Lakshmi

Enterpirses of A.5, P.W.4 deposed that under Ex.P.51 cheque for

Rs.3,30,000/- dated 31.12.2002 in favour of Shivaom kumar (A.15) under Ex.P.52 cheque dated 3.1.2002 for Rs.3 lakhs in favour of S.K.

Singh and under Ex.P.53 cheuqe dated 1.1.2003 in favour of self for

Rs.5 lakhs and under Ex.P.54 cheque for Rs.5 lakhs dated 31.12.2002 in favour of Suvidhi International Private Limited and under Ex.P.57 cheque dated 3.1.2003 for Rs.5 lakhs in favour of Suvidhi International

Pvt. Ltd., and all the cheques were encashed.

37C.C.2/2007/Prl. CBI

Court/VSP

p)P.W.4 deposed that under Ex.P.55 cheque dated 1.1.2003 for Rs.5 lakhs Lord Empire International of A.6 issued self cheque and the same was encashed.

q)With regard to all the accounts, P.W.4 deposed as follows at page

No.17:

“By perusing the transactions in these accounts show those are interlinked with each other and amounts were transferred from one account to another account and later withdrawals. Those proprietors of respective firms whose photos affixed on account opening forms were present before my officer in the Branch and signed subsequently by my Officers to that effect signed on those account opening forms for authenticity and then I signed in those account opening forms and permitted to open the current accounts in the names of those respective firms. I signed on those account opening forms after duly verifying the photos of proprietors of respective forms, their signatures and also the signatures of introducers. Mr. Bhagwan Tulsian (A.2) used to accompany the account holders most of the time for opening the accounts.”

7)BANK ACCOUNTS OF KEDIA OVERSEAS LTD., IMPORTER, HYDERABAD - ISSUE OF CHEQUES/D.Ds.:

Admittedly the seven questioned DEPB licenses Exs.P.64, P.65,

P.81 to P.85 were transferred in favour of Kedia Overseas Ltd.

i)UTI BANK LTD/ AXIS BANK:

P.W.5/M. Sujatha who worked as Manager/Assistant Vice

President in UTI Bank Limited/Axis Bank, Hyderabad deposed that

Ex.P.60 is Statement of account of M/s.Kedia Overseas Limited and she attested the same and Ex.P.61 cheque dated 19.2.2003 issued by authorized signatory of Kedia Overseas Limited in favour of Sai 38C.C.2/2007/Prl. CBI

Court/VSP

International, Mumbai for Rs.25,50,590/- was presented for clearing by

ABN AMRO Bank, Banjara Hills, Hyderabad and it was cleared on 26.2.2003 and the transaction is also reflected in Ex.P.60 statement of account. This amount is with reference to the payment under Ex.P.65

DEPB License according to prosecution and clearly mentioned in final report.

ii)SBH, HYDERABAD:

a)P.W.9/C. Balraj, Chief Manager, Mehaboob Ganj Branch, State

Bank of Hyderabad, Hyderabad from 2001 to 2004 deposed that

Ex.P.70 is the computerized statement of account of Kedia Overseas

Limited in his branch for the period from 20.12.2002 to 15.1.2003 and it contains various credits, debits and withdrawals.

b)According to P.W.9 Ex.P.71 is cheque for Rs.27,93,946/- dated 25.12.2002 issued by Kedia Overseas Limited for issuing Demand draft in favour of M/s.Paramhans Trading Company of A.3 and Ex.P.72 is D.D., application dated 25.12.2002 issued by Kedia Overseas Limited for obtaining Demand Draft for Rs.27,91,155/- in favour of Paramhans

Trading Company of A.3 and Ex.P.73 is demand draft for Rs.27,91,155/-

dated 26.12.2002 issued in favour of Paramhans Trading Company of

A.3 and Ex.P.73 was issued on the basis of Ex.P.71 and P.72 and Ex.P.74 cheque was issued by Kedia Overseas Limited on 20.12.2002 for

Rs.28,40,496/- in favour of Paramhans Exports of A.16 and Ex.P.75 is

Demand draft application dated 20.12.2002 in favour of Paramhans

Exports of A.16 by Kedia Overseas Limited for Rs.28,37,658/- and

Ex.P.3 is demadn draft for Rs.28,37,658/- issued by Kedia Overseas

Limited in favour of Paramhans Exports and Ex.P.76 is the cheque issued by Kedia Overseas Limited dated 13.1.2003 for Rs.87,979/- in 39C.C.2/2007/Prl. CBI

Court/VSP favour of M/s.Satyam Impex of A.1 and Ex.P.77 demand draft application of Kedia Overseas Ltd., dated 13.1.2003 for Rs.87,891/- in favour of Paramhans Exports of A.16 and Ex.P.78 is demand draft in favour of Satyam Impex of A.1 dated 15.1.2003 for Rs.87,891/- and

Ex.P.78 was issued on the basis of Ex.P.76 and P.77 and Exs.P.73, P.78 and P.3 D.Ds., were passed on clearing.

c)P.W.9 further deposed that Ex.P.79 is cheque dated 25.12.2002 issued by Kedia Overseas Ltd., for Rs.54,53,745/- in favour of

Corporation Bank (M/s. Overseas Trader, LW.6) and the said cheque was presented by Corporation Bank and cleared and Ex.P.80 is cheque

dated 13.1.2003 issued by Kedia Overseas Limited for Rs.52 lakhs in

favour of Corporation Bank (Satyam Impex of A.1) and Ex.P.80 was presented by Corporation Bank and cleared. According to prosecution though M/s.Overseas Traders (L.W.16) Meerut – two DEPB License in the name of Satya Impex of A.1.

d)P.W.9 further deposed that all the cheque transactions referred to him are reflected in Ex.P.70 statement of account of Kedia Overseas

Ltd.

iii)OFFICERS OF CORPORATION BANK, HYDERBAD – CREDITING THE AMOUNTS:

a)P.W.29/T. Rangarao, who worked as Branch Manager, Corporation

Bank, Hyderabad, in CAPS Branch (collection and payment service branch deposed that object of CAPS is collection of clients cheques and making payments to different banks where they are maintaining the accounts.

b)According to him, Ex.P.79 cheque and Ex.P.22 cheque were presented through clearing by Corporation Bank through SBH, 40C.C.2/2007/Prl. CBI

Court/VSP

Hyderabad and after realization of funds at the request of client Kedia

Overseas Ltd., Hyderabad, amount covered under Ex.P.79 cheque was remitted to Overseas Traders, Meerut branch (L.W..16) and amount covered under Ex.P.22 cheque was remitted to Satyam Impex Mumbai

A.1 and remit messages were sent to Corporation Bank, Meerut under

Ex.P.108 and Corporation Bank, Mumbai, under Ex.P.109 and he signed in remit message as Manager on 15.1.2002 and amount covered under

Ex.P.108 is Rs.54,53,745/- and amount covered under Ex.P.109 is Rs.52 lakhs.

c) In cross examination he clearly deposed that since amount covered under Ex.P.108 and 109 remit messages are huge amounts and he had seen Ex.P.79 and P.22 cheques before issuing the said message.

d)P.W.51/Jagadeswar V. Hiremath, who worked as Officer,

Corproation Bank, CAPS Branch, Mumbai , from June, 2000 to June, 2003, deposed that Ex.P.86 is pay order dated 15.1.2003 in favour of

M/s.Satyam Impex/A.1 for Rs.52 lakhs and Ex.P.109 e-mail message was received from Hyderabad CAPS Branch in respect of the same and it was processed by the concerned Officer Dinesh Gokhale (P.W.30) and

Ex.P.86 pay order was prepared and signed by him as First officer and since amount was more than Rs.1 lakh the pay order was given by him along with First Officer and afer verifying the pay order with CORP

Remit message he signed as Second Officer and issued to the party concerned i.e., M/s.Satyam Impex of A.1.

e)P.W.30/Dinesh Gokhale, who worked as Officer Corporation Bank,

CAPS Branch, Mumbai in 2002-2003 deposed that his duty at that time was to receive remit messages and upload them in the system and 41C.C.2/2007/Prl. CBI

Court/VSP take out pay order in the name of payees in whose names the messages have come. He clearly deposed that basing on Ex.P.109 remit message he prepared Ex.P.86 pay order in favour of Satyam

Impex (A.1) and signed thereon as one of the officers and it also contains the signature of Jagadish Hiremath, the then Officer of the

Branch and Ex.P.86 is presented in Citi Bank, Mumbai and cleared.

f)Nothing useful to the case of defence was elicited from P.Ws.29 and 30.

iv)ABN- AMRO BANK, MUMBAI:

a)P.W.31/Rajeev Raghavan who worked in ABN AMRO Bank,

Nariman point, Mumbai, during the years 2003-2009 as Assistant Vice-

President deposed that he worked along with Mrs.Keerty Shetty approximately for two to three years in that Bank and she authorized

Balaji Corporation to open account and he identified her signatures in

Ex.P.110 account opening form along with Statement of Account.

Through him Ex.P.111 account opening form along with Statement of account of Sanjay Agencies, Proprietor Hitesh Jain, Ex.P.112 current account statement of Satyam Impex (A.1) for the period from 24.1.2003 to 30.11.2005, Ex.P.113 account opening form along with statement of Cletus Antony Dsouza, Ex.P.114 account opening form along with statement of account of Steel Trade represented by its

Proprietor Satya Prakash Sharma were marked. According to P.W.31

Exs.P.110 to P.114 statement of accounts contain the credit and debit entries, withdrawal details and other transactions date wise. He further deposed that Ex.P.115 is the list of seven cheques showing withdrawals from S.B.A/c.No.800843 of Sai International (in whose name Ex.P.65 was issued) and the said account had high value deposit 42C.C.2/2007/Prl. CBI

Court/VSP of an amount of Rs.25,50,590/- but subsequently those amounts were withdrawn through Ex.P.115 cheques (seven).

b) Through P.W.31 the statement of current account of Satyam

Impex/A.1 and List of seven cheques under Ex.P.115 showing withdrawls from Sai International of A.1 were marked. It is further proved that the account of Sai International had high value deposit of

Rs.25,50,590/- but subsequently those amounts were withdrawn.

Though it is a fact that he did not sign in any of the documents marked thrugh P.W.31, he identified the signatures of Mrs.Keerty Shetty,

Mr.Sebasestian who signed in these exhibts. Hence, nothing useful to the case of defence was elicited from P.W.31

v)CORPORATION BANK, SERVICE BRANCH, DELHI – ISSUING

D.Ds., IN FAVOUR OF SAKSHI IMPEX OF A.15 Y MEERUT

BRANCH:

a)P.W.38/P.K. Iyer who worked as Senior Manager, Corporation

Bank, Service Branch, Delhi, deposed that Exs.P.8 to P.10 belongs to their Branch at Meerut and D.D. dated 30.12.2002 and the three

D.Ds., i.e., Exs.P.122 to P.124 also pertains to their Branch at Meerut and they were issued in favour of Sri Sakshi Impex of A.15 and all these D.Ds., were cleared and Ex.P.122 dated 30.12.2002 is for Rs.9 lakhs and Ex.P.123 D.D. dated 30.12.2002 is for Rs.9 lakhs and

Ex.P.124 D.D., dated 30.12.2002 is for Rs.8,41,061/- and CBI collected these D.Ds., from the office.

b)Though in cross examination he deposed that he did not personally deal with Exs.P.8 to 10 and P.122 to P.124, being Senior

Manager of the Bank and overall incharge of service branch and clearing operations he is very much competent to depose about the said D.Ds., issued to A.15.

43C.C.2/2007/Prl. CBI

Court/VSP vi)SBH, SERVICE BRANCH, NEW DELHI – ISSUING D.Ds., IN FAVOUR OF M/S.PARAMHANS EXPORTS OF A.16:

a)P.W.50/Vijayakumar Srivastav, who worked as Assistant Manager in SBH service Branch, New Delhi from 2002 to 2004 clearly deposed that he passed Ex.P.3 D.D., dated 20.12.2002 for Rs.28,37,658/- in favour of M/s.Paramhans Exports (A.16) payable at SBH, Service

Branch, and issued by Mehabbob Ganj Branch, the same bank,

Hyderabad and D.D., was presented in high value clearing by Lord

Krishna Bank, Noida through RBI on 26.12.2002 and he verified the signature on D.D., with that of specimen signatures available int eh branch after receiving the D.D. and also obtained telephonic confirmation from Mehaboob Ganj Branch, Hyderabad and Ex.P.3 D.D., was passed on payment on 26.12.2002 and paid by their service branch and he signed in Ex.P.3 D.D., at the time of passing the same.

Nothing useful was elicited from P.W.15.

vii)SBH, SERVICE BRANCH, NEW DELHI – ISSUING D.Ds., IN

FAVOUR OF M/S.PARAMHANS TRADING COMPANY OF A.3 –

ARRANGEMENT OF TWO QUESTIONED LICENSES:

a)According to prosecution out of seven questioned DEPBs., through L.W.16/broker two licenses were purchased by Kedia Overseas

Ltd., Hyderabad.

b)P.W.56/Sandeepan Majumdar, who worked as Branch Manager,

SBH Service Branch, New Delhi from 2000 to April, 2003 deposed that he passed Ex.P.73 D.D., for Rs.27,91,155/- in favour of M/s.Paramhans

Trading Company (A.3) on presented by HDFC Bank and he put his initial on D.D.,with regard to passing of Ex.P.73 D.D.

44C.C.2/2007/Prl. CBI

Court/VSP viii)ACCOUNT OF OVERSEAS TRADERS, MEERUT (L.W.16) -

CORPORATION BANK, MEERUT -PAYMENTS

a)P.W.57/P. Rajendran who worked as Branch Manager of

Corporation Bank in Meerut Branch from 20.6.2002 to 19.2.2005 deposed that Ex.P.141 is the account opening form of Overseas Traders represented by Proprietor Anil Kumar Gupta (L.W.16) and the said proprietor submitted copies of PAN Card, passport, voter ID along with account opening form and Ex.P.142 is Statement of account of

Overseas Traders from 1.10.2002 to 31.3.2003 and one TT message under Ex.P.108 from CAPS, Hyderabad, was received for payment of

Rs.54,53,745/- to Overseas Traders Proprietor Mr. Anil Kumar Gupta (L.W.16) and on receiving the message the said party came and met him in the Branch (Meerut) and he requested the said person to open current account for crediting the amount and accordingly, he opened the current account and deposited his own amount of Rs.5,000/- and

TT amount has been credited to that account.

8)TAKING Exs.P.8 TO P.10, P.122 TO P.124 D.Ds., IN FAVOUR OF SAKSHI IMPEX OF A.15:

a)He further deposed that subsequently he wanted to take three

D.Ds., for total amount of Rs.26,76,795/- and accordingly on the next day i.e., on 27.12.2002 he took three D.Ds., under Exs.P.8 to P.10 in favour of Sri Sakshi Impex (A.15) payable at Delhi and these three

D.Ds.,were signed by his officers Atul Kumar Sharma and Mr. Ranvir

Singh and again on 30.12.2002 he took three D.Ds., amounting to

Rs.26,46,343/- in the name of Sri Sakshi Impex (A.15) payable at Delhi under Exs.P.122 to P.124 and all the six D.Ds.,were cleared by Accounts

Section of Corporation Bank, Delhi on presentation and these documents were handed over by him to CBI.

45C.C.2/2007/Prl. CBI

Court/VSP

b)In cross examination he admits that both officers i.e, Atul Kuma

Shama and Ranvir singh in the branch dealt with the six D.Ds., referred to in chief examination and basing on documents only he deposed.

9)PASSING OF Exs.P.3 AND P.73 – D.Ds., IN FAVOUR OF M/S. PRAMHANS TRADING COMPANY OF A.3:

P.W.59/Ananth Shayan, who worked in SBI Service Branch, New

Delhi from December, 2003 to June, 2006 deposed that Ex.P.3 D.D., for

Rs.28,37,658/- favouring Paramhans Exports of (A.16) was presented by Lord Krishna Bank, Noida, UP and this D.D., was passed in Service

Branch on 26.12.2002 and so also Ex.P.73 D.D., for Rs.27,91,155/- favouring Paramhans Trading Company of A.3 was passed in the service branch on 30.12.2002 on presenting the same by HDFC Bank

Limited and he handed over Exs.P.3 and P.73 to CBI.

10)REASONS FOR ISSUING SIX D.Ds., (Exs.P.8 TO 10 & 122 TO

124) INSTEAD OF ONE:

a)P.W.63/Atul Kumar Sharma, who worked as Officer in Corporation

Bank, Meerut branch from May, 2002 to 2005 deposed that Ex.P.150 demand draft application signed by Anil Kumar Gupta (L.W.16)

Overseas Traders, Meerut for issuance of D.D., in the name of Shree

Sakshi Impex (A.15) for Rs.26,71,395/- and Ex.P.151 DD application for issuance of D.D., duly signed by Akash Gupta (L.W.81) in the name of

Shree Sakshi Impex of A.15 for Rs.26,41,061/- payable at Delhi and in pursuance of these two applications Corporation bank issued six D.Ds., for the total amount under Exs.P.8 to P.10, P.122 to P.124 and all the six

D.Ds., were signed him and counter signed by Ranvir Singh. He further explained that because it was not possible to issue single D.D., for the amount of about Rs.10 lakhs it was bifurcated and three D.Ds., were issued under each application and these D.Ds., were presented in 46C.C.2/2007/Prl. CBI

Court/VSP accounts section of Corporation Bank, New Delhi and they were cleared.

b)He also deposed that Ex.P.141 current account opening form of

Overseas Traders whose proprietor is Anil Kumar Gupta was signed by him as Officer and verifying authority. Nothing useful to the case of defence was elicited from P.W.63 in cross examination. Though

Ex.P.151 D.D., application mentions the name of applicant as Aakash

Gupta, witness clearly explained that since it is only application for

D.D., Aakash Gupta is competent to sign the same supported by duly signed cheque of the account holder.

c)The aforementioned testimonies of the respective Bank witnesses i.e., P.Ws.1 to 5, 9, 13, 29, 30, 31, 38, 50, 51, 56, 57, 59 and 63 clearly shows the huge amounts paid by Kedia Overseas Limited

Hyderabad and received by the Proprietorship concerns of the accused and transferred to some other accounts and withdrawn ultimately and more particularly the testimonies of P.Ws.1 to 3 show that nearly one year after opening of the accounts of the proprietorship concerns of

A.1 to A.6 and A.15, A.16 they were closed after the payment and receipt of the said amounts and as such, the accounts were opened only for the purpose mentioned in the charge sheet.

d)Sec.65-B OF EVIDENCE ACT:

With regard to sec.65-B of Evidence Act objection raised by the defence counsel, Learned Public Prosecutor placed reliance upon order

of Hon’ble Apex Court in SLP (Criminal) No. 2302 of 2017 dated

30.1.2018 between Shafi Mohammed Vs. State of Himachal

Pradesh wherein the Lordships succinctly held as follows:

47C.C.2/2007/Prl. CBI

Court/VSP “Requirement of certificate under sec.65-B (h) is not always mandatory and the procedural requirement under sec.65-B (4) of

Evidence Act of furnishing certificate is to be applied only when such electronic evidence is produced by a person who is in a position to produce such certificate being in control of the said device and not of the opposite party and in case where electronic evidence is produced by a party who is not in a position of a device applicability of sections 63 and 65 of

Evidence Act cannot be held to be excluded and if this is not so permitted it will be denial of justice to the person who is in possession of authentic evidence/witness but on account of manner of proving such document is kept out of consideration by the Court in the absence of certificate under sec.65-B(4) of

Evidence Act which party producing cannot possibly secure.”

No contra decisions are cited by the counsel for the accused.

The decision relied upon by the Learned Public Prosecutor is the latest ruling of Hon’ble Apex Court on the field. Many bank officials deposed were not in control of the device as contemplated in the aforementioned decision since they were the then officials of respective banks during the period of transactions but not at the tme of deposing. Hence, the objections raised by Learned counsel for the defence for many documents in this case on the ground of lack of certificate under sec.65-B of Evidence Act cannot be considered.

11)SPECIFIC ALLEGATION OF THE QUESTIONED LICENSES WERE PART OF MISSING LICENSES IN DGFT, NEW DELHI:

a)In charge sheet there is specific allegation that A.2 arranged the questioned seven bogus licenses in the names of the firms mentioned from the blank license forms bearing Nos.OA 286518, OA 286528, OA 286530, OA 286538, OA 286539, OA 286545 and OA 285781 were part of the license forms missing from DGFT office, Udyog Bhavan, New

Delhi, during the period 2000-2001 and A.2 fabricated the said seven 48C.C.2/2007/Prl. CBI

Court/VSP

DEPB Licenses in the names of the firms mentioned in the charge sheet and corresponding TRAs., in the names of Importer M/s.Kedia Overseas

Limited, Hyderabad, as if exports were made by these firms from

Nhava Sheva, Maharashtra, for the purpose of committing the fraud and illegal gain.

b)In this connection prosecution examined P.Ws.62,58,49 and got marked Exs.P.131, 132, 139 & 143 regarding the missing of printed license forms and OA numbers on the seven questioned licenses were tallied with the numbers of printed blank license forms mentioned by

P.Ws. .

c)At the outset P.W.62 who worked as Deputy Controller of Stamps and overall incharge of Central Stamps Depot, Nasik, Maharashtra and deposed about the procedure as to how India Security Press prints blank license forms and sends the same to the Government offices including DGFT Office, New Delhi is crucial.

d)P.W.62/M.V.Ramakrishna Rao deposed that all the indents received will be consolidated in his office and sent to the India

Security Press for printing and supply and his duties include receiving of indents from various Government departments like DGFT,New Delhi for printing blank license forms and communicating their requirement to the India Security Press which is in the same campus for taking necessary action in printing, processing, packing and supply to Central

Stamp Depot and blank license forms are printed and packed in printing section of India Security Press and then sent to Central Stamps

Depot for dispatch to the consignees. He further deposed that according to page 163 of Ex.P.132 invoice dispatch of Central Stamp

Depot, Nasik Road, 3000 license forms in computer sheets were issued 49C.C.2/2007/Prl. CBI

Court/VSP for Customs purpose with OA Nos.284001 to 287000 in three sets i.e., in triplicate and one set of forms for customs purpose, another set for exchange control purpose and third set for record purpose and all these three sets were sent to Joint Director General of Foreign Trade,

Ministry of Commerce, Moulana Azad Road, New Delhi and at the back of invoice there are printed conditions stating that original to be retained in local or branch depot as the case may be, duplicate copy to be acknowledged and forwarded to Deputy Controller of Stamps,

Central Stamp Depot, Nasik and triplicate copy to be acknowledged and returned to post Master General concerned and there is no acknowledgment received from DGFT New Delhi in Ex.P.132 file.

e)Perused Ex.P.132 file. It contains even three empty brown covers wherein the printed forms were received at page Nos.184 to 186.

Ex.P.184 cover contains the initial of Assistant Inspector and Number of senior Checker 814 and that there are three sets.

f)The next important witness is P.W.58/Ramkumar who worked as

Deputy Director General, Foreign Trade in Delhi from January, 2001 to

September, 2006 and looked after Inspection, Enforcement,

Adjudication, General Section including House keeping jobs, HRD etc., deposed that during his tenure K.P.Singh (L.W.9) was incharge of

General Section and his duties were to get work done by staff of

General Section and to invite the demand of Blank License Forms required by Port/Regional Offices of DGFT and on receipt of such demands he used to consolidate the total requirement of blank license forms and put indent to Government Press, Nasik for supply of blank license forms to DGFT Headquarter and on receiving them he enters them in a register/record maintained by him and used to send these 50C.C.2/2007/Prl. CBI

Court/VSP blank licenses to the Port Officers of DGFT as per their requirement and

Ex.P.132 file contains details of 3000 blank license forms in three sets received on 28.11.2000 by incharge of General section from

Government Press, Nasik and in Ex.P.131 extract of register maintained by incharge of General section, DGFT, on 5.12.2000 there is an entry in that register about computerized license forms etc., received from

Nasik Press by Mr.K.P.Singh (LW9) and according to entry dated 15.6.2001 t last packet containing S.Nos.OA-286001 to OA-287000 was opened and found that 50 numbers i.e., OA-286501 to 286550 were also short in the packet and those short licenses were cancelled and information was sent to all Port officers/Collectors of Customs and

Central Processes/RBI and other authorities and he addressed Ex.P.143 letter to Deputy Commissioner of Customs, Mumbai, for cancellation of these O.As., and also that according to Joint DGFT, Coimbatore computerized license sheets were not found in the packets sent to them.

g)Even this witness deposed that he did not register any FIR against K.P. Singh (L.W.9) after noticing about missing of licenses and no Departmental action was initiated against him. He strongly denied the suggestion that the Department itself colluded with K.P.Singh and sold these licenses in open market and due to that they failed to take any action against K.P.Singh. But in cross examination it was elicited from P.W.58 that along with K.P.Singh three officers have to check the licenses soon after receiving but they failed to check them.

h)P.W.49/P.K. Santra deposed that he worked as Deputy DGFT in the office of Director General of Foreign Trade, Udyog Bhavan, New

Delhi from August, 1999 to March, 2007 and during the said period he 51C.C.2/2007/Prl. CBI

Court/VSP was incharge of General Administration Policy Division and licenses and his duties during that time as Deputy DGFT were to supervise the work of General section which includes up keep of the building, purchase of stationery items, furniture etc., and getting printed blank forms from Government of India Press, Nasik and in the beginning of each year they used to take requisition from all regional offices about the requirement of blank license forms and on receiving the requisition by consolidating the same they used to send indent to

Government of India, Security Press, Nasik for printing and sending the requisite number of blank license forms to various licensing authorities including DGFT Headquarters and in DGFT Headquarters after receiving the supply of blank license forms from Postal Authorities the

FTDO concerned will check that the seal is intact and it is not damaged and the section will take delivery and FTDO will open the bundles and physically check each and every license form and count it with the assistance of the staff and if it is found in order he will enter the details of blank license forms in the stock register maintained by him and

before entering the persons who counted the license forms will sign

and authenticate that they have checked and found correct on the cover of the envelope along with date and FTDO will also sign and even Government of India Security Press while forwarding the blank license forms will send letter along with the details of licenses in triplicate. He further deposed that if all the licenses are found in order the FTDO will send the second copy of acknowledgment to the

Government of India Press and third copy to the Postal authorities and keep the first copy in the section in the file concerned and if the blank license forms are found defective, damaged or short supply immediately that will be taken up with Government of India security 52C.C.2/2007/Prl. CBI

Court/VSP

Press by him and after entering the blank licenses in stock register he will issue them to Regional Licensing Authorities as per their demand and maintain proper record in the stock register and these license forms are kept in Almyrah of a strong room in personal custody of

FTDO.

i)With regard to stock particulars, he deposed that as per the entry made by FTDO General in the stock register 3000 blank computerized license forms bearing Nos.OA-284001 to OA-287000 in nine bundles were received from Government of India Security Press, Nasik and this was entered on 5.12.2000 in the stock register by K.P.Singh, the then

FTDO General which is available in Ex.P.131 at sheet No.6 and nine bundles were forwarded by Nasik press under covering letter 28.11.2000 which is mentioned at Page No.163 of Ex.P.132. He further deposed that though as per procedure the acknowledgment of receipt of these forms should be sent to Government of India Press, Nasik all the three copies in original are available in the file without sending them to Nasik Press or Postal Authorities and vide letter dated 6.6.2001 the office of Joint DGFT, Coimbatore, informed that on opening the outer cloth cover a paper wrapped packet stated to contain 1000 sheets OA Nos.285001 to OA 286000 signed by Asst.

Inspector with date 14.11.2000 on label was found tattered and broken on a side and on verification OA 285476 to OA 285500 and OA285779 to OA 285783 were missing and it was also informed that all the customs/licensing authorities were being intimated and these sheets were made invalid to avoid chances of misuse and the said information to that effect was received by the office of DGFT on 11.6.2001 by FTDO 53C.C.2/2007/Prl. CBI

Court/VSP

General and he examined the same and after examining the same

FTDO noted the same fact informed by Coimbatore office.

j)Regarding shortage of Licenses P.W.49 deposed that from the package received from Security Press which was still in his stock and checked he found that the packet which contains blank computer license sheets is short by 15 numbers i.e., from OA-286501 to OA- 286550 and five exchange copies were also found short and this was submitted to Senior Officers and also taken up with Vigilance section which sent copy of manual of security instructions and copies of securities instructions issued from time to time regarding measures to be taken for safety of blank license forms after receiving from security press etc., and as per OMI Instructions in case of short receipt of licenses from Security Press the same should be immediately reported to General Manager, Security Press for further action by them under intimation to the vigilance section at Headquarters and as per the said instructions the issue of short licenses was taken up with Government of India Press on 22.6.2001 and as per the instructions simultaneously the Customs Authorities and Licensing Authorities were informed that these blank copies of licenses along with the missing licenses reported by the office of Joint DFT Coimbatore and Varanasi are ordered to be cancelled to prevent any misutilization of computerized license sheets and it was also informed that in case they are found or available with any Licensing Authority in the form of a format or license for clearance of goods etc., the same should not be entertained and take personal custody of them forthwith and the office of the DGFT may be intimated immediately for further action.

54C.C.2/2007/Prl. CBI

Court/VSP

k)Through him Ex.P.139 photo copy of manual of instructions issued by office of Chief Controller of Imports and Exports, New Delhi and Ex.P.140 photocopy of O & M Instruction No.11/2001 dated 30.8.2001 issued by DGFT New Delhi regarding safe custody of these blank licenses were marked.

l)According to P.W.49 as per the entry made in Ex.P.131 stock register dated 15.6.2001 by Sri K.P.Singh, the then FTDO General, in sheet No.8 the last packet containing blank license forms bearing

Nos.OA-286001 to OA-287000 was opened and found that serial numbers OA-286501 to OA-286550 (50 numbers) were misplaced/short in that packet along with six copies of exchange control copies which were also short in that packet and his successor Sri Ram Kumar sent

Ex.P.132 letter dated 10.10.2001 to all Customs Authorities and

Licensing Authorities bringing out a typographical error in his (P.W.49) letter dated 20.6.2001 regarding O.A. Nos. of Blank computerized license forms.

m)In cross examination he deposed that K.P. Singh, FTDO General, who received 9000 blank computerized license forms and entered in to has not checked or counted 9000 forms and kept them as it is in safe custody and only after a reference came from Joint DFGT Coimbatore he verified the bundles available at that time and noticed that the last bundle was short of fifty forms. He further deposed that the said K.P.

Singh is personally responsible for safe custody of licenses, license forms,DEPB books and for storing them in a Strong room and he doesn't know whether any FIR was registered against K.P. Singh and whether any enquiry was conducted against him and he had not lodged any complaint against him as he left the General section on 55C.C.2/2007/Prl. CBI

Court/VSP 28.6.2001 and brought the said fact to the notice of his superiors on the date of missing by putting up note in Ex.P.132 file.

n)These three testimonies of P.Ws.62,58 and 49 clearly demonstrates how the blank DEPB License forms will be printed in

India Security Press, Nasik as per the indent sent to them and how they will be dispatched to the concerned Government offices and how many bundles were received in fact by the office of DGFT Delhi and connected documents marked through these three witnesses unimpeachably shows missing of blank license forms and also shortage of 50 license forms in DGFT Office, Delhi and the same were intimated to Security Press, Nasik for action and at page no.3, P.W.49 clearly deposed that customs authorities and licensing authorities were informed that blank copies of licenses as reported by Joint GFT,

Coimbatore and Varanasi are ordered to be cancelled to prevent misuse of computerized license sheets with numbers and if they are found or available with any licensing authority or customs authority in the form of Format of license for clearance of goods etc., they should not be entertained.

o)P.W.58 clearly mentioned that he addressed Ex.P.143 letter to

Deputy Commissioner of Customs for cancellation of 30 numbers of blank printed license forms and 50 numbers of misplaced/shortage of blank licensed forms mentioning their O.A. Numbers.

p)In the light of this evidence, prosecution proved that

O.A.Numbers on the questioned licenses are tallied with O.A.

numbers of the blank license forms as contended.

12)FABRICATION OR FORGING OF QUESTIONED SEVEN DEPBs (Exs.64,65, 80 to 85):

56C.C.2/2007/Prl. CBI

Court/VSP

In this connection, as mentioned supra P.W.33 clearly explained as to what are DEPBs., how they are generated and in what way they are useful.

13)WHAT ARE DEPBs., AND TRAs.,:

a)Since the entire case of prosecution is forging and fabricating of seven DEPBs., and TRAs., and submission of the same before Kakinada

Port by Importer M/s. Kedia Overseas Limited who ultimately utilized the same for clearing and duty exemption for imported goods and thereby Customs House Kakinada was put to huge loss to the tune of

Rs.2 crores, it is expedient to know what are DEPBs., and TRAs., and who issues them and the related procedures.

b)The only witness for prosecution who explained about these aspects is P.W.33/Y.V. Satyanarayana who joined in Customs

Department as Inspector in 1985 and worked in various capacities and during the relevant period he worked as Superintendent appraising,

Customs House, Kakinada and deposed that he is conversant about the

Customs and Central Excise procedures and deposed as follows in this connection:

“Ministry of Commerce, Government of India, announces EXIM (Export Import) policy for a period of every five years approximately. Ministry announced EXIM policy for the block period of 1997-2002. In this EXIM Policy the Ministry introduced a scheme called DEPB scheme. According to this scheme, the

Exporter of goods will get some beneifts and in the case of DEPB in the form of credit. The Exporter after exporting goods concerned, export documents will be submitted to DGFT (Director General of Foreign Trade) a wing of Ministry of

Commerce for the EXIM policy benefits. After examination of the documents DGFT will issue DEPB (Duty Exemption Pass Book) 57C.C.2/2007/Prl. CBI

Court/VSP scripts. In line with the above said EXIM policy Ministry of

Finance issued notification No.45 of 2002 exempting the

Customs duties and import of goods provided DEPB scripts are produced subject to some conditions in the notification.

According to this notification the DEPB holder has to register the

DEPB scripts issued by the Ministry of Commerce with the

Customs authorities i.e., at which initially the goods were exported. The Ministry of Finance also issued Circular No.10/97 prescribed a procedure with regard to registration of DEPB scripts. After registration of DEPB scripts the Customs Officers will return to the script holder. Now the DEPB scripts holder can import goods by utilizing the said credit given in the DEPB scripts towards payment of Customs duties payable on the proposed import goods. Government has given another facility i.e., if the

DEPB script holder doesn't like to import goods he can transfer the said DEPB Script to any person who intends to import. The

DEPB script holder or the DEPB transfer holder can import the goods at the said Port where initially these DEPB scripts were registered. Later another facility was provided by Circular

No.33/97 for issuing TRA (Telegraphic release Advice) to enable the DEPB Script holder or DEPB script transfer holder can import goods at some other port to which the said TRA was issued. The

TRA received by Customs authority at Customs Port where DEPB scripts were registered on the request of DEPB script holder.

“The DEPB script holder or DEPB script transfer holder themselves or Customs House Agent will furnish sealed cover containing TRA, original DEPB scripts along with enclosures and bill of entry for import of goods to the Customs authorities situated at TRA receiving Port. There the Dealing Assistant will receive these documents and verify whether seal is in tact and then open the sealed cover and verify the contents of TRA i.e.,whether TRA was issued to that Port and to that DEPB script holder. On satisfaction of verification the Dealing Assistant will enter in the said TRA Register maintained by the Customs House.

Thereafter, the Dealing Assistant will verify the other conditions of the said notification i.e., whether the Port issued TRA in the 58C.C.2/2007/Prl. CBI

Court/VSP name of DEPB script holder on DEPB script number and credit transfer on the TRA, CIF vale etc., and then submit all the documents to the Superintendent Appraising. The

Superintendent Appraising after examination assist the Bill of entry and forward to the Assistant Commission and Assistant

Commissioner after examining the said file will counter sign the bill of entry. Then the importer is eligible to clear the imported goods. In case of import of oil only 50% of the credit can be utilized for bill of entry and another 50% of the duty by cash.

This is amendment of notification No.45/2002 mentioned above.

After bill of entry passed the customs authorities will inform the

TRA particulars and bill of entry containing the DEPB availed particulars to the customs authorities for the Port of TRA issuing

Port.

“No verification of TRA/DEPB with regard to genuineness was prescribed. However, genuineness of TRA is presumed if no contrary comes from the customs authorities at TRA issuing Port with reference to our TRA utilization particulars mentioned in the above para.”

c)The entire procedure of obtaining DEPBs and TRAs and clearance of imported goods by utilizing them in respective Ports mentioned by

P.W.33 in chief examination is not at all disturbed in any manner in cross examination. Hence, the said procedures can be safely taken into consideration in analyzing the case of prosecution.

d) The next important witness is P.W.11/Vora Shailesh Kumar who is a chartered accountant since 1990 in Mumbai. He deposed that he along with Sanjay Kothari incorporated Sanjay Kothari and Company in 1999-2000 and were arranging funds for the corporate from Banks and

Financial Institutions and he was in practice of funds syndication and related matters with his partner Sanjay Kothari during that time and

Mr. Damini and Jitendra Kumar Kedia, who are Directors of M/s.Kedia 59C.C.2/2007/Prl. CBI

Court/VSP

Overseas Limited, Hyderabad, approached him in the year 2000 for arranging working capital fund for their company and during discussions with them he promised to arrange working capital to the

Banks.

e) In respect of DEPBs., he deposed that after the said discussion about working capital the Directors of Kedia Overseas Limited asked him if he could arrange DEPB License and he replied that he cannot arrange the same but however, he informed that one Tarachand

Chhajed by Bhayandar, Thane, was known to him and he contacted him and called him to his office and asked him if he could arrange

DEPB License for which he stated that he would try the same and he introduced the said Tarachand to Jitendra Kumar Kedia (L.W.20) and

Damini/P.W.15 and they discussed for DEPB License in his office.

f)He further deposed that three or four months later i.e., in the month of August or September, 2003 P.W.15/Damini and Jitendra

Kumar again visited his office and informed them DEPB Licenses arranged by Mr. Tarachand were false and fabricated and upon the said information when he tried to contact Tarachand over cell phone and when it was switched off all of them went to the house of Taranchand and the said Tarachand informed that he arranged DEPB License through somebody else and somebody else whose names were though given by Tarachand he doesn't remember them.

14)TARACHAND AND ARRANGEMENT OF FIVE QUESTIONED LICENSES:

a) Tarachand who allegedly arranged the DEPB License according to

P.W.11 was examined as P.W.12. His evidence is crucial in this connection. He deposed in chief examination that he along with Sanjay 60C.C.2/2007/Prl. CBI

Court/VSP

Jain (A.1) arranged the five DEPB Licenses i.e., Exs.P.64, P.65, P.81, P.83 and P.85 through Rajesh Chopra of Mumbai (L.W.28) to Kedia Overseas

Limited, Hyderabad, and P.W.11 introduced Jitendra Kumar Kedia &

Damani who are Directors of Kedia Overseas Limited. Regarding how they arranged the said five licenses, he deposed that he and Sanjay

Jain (A.1) used to regularly visit Sri Saibaba temple, Kandiville Highway on every Thursday and there they met Rajesh Chopra (L.W.28) who informed that he would arrange DEPB licenses and requested to introduce him to any purchasers and as such he informed P.W.11 about

Rajesh Chopra and four or five months later P.W.11 informed him that

Jitendra Kumar Kedia required DEPB Licenses and he can arrange meeting with them and accordingly meeting was arranged in his office and subsequently, he along with Sanjay informed Rajesh Chopra about the requiremnt of Jitendra Kedia and Rajesh Chopra inturn arranged

DEPB licenses to M/s. Kedia Overseas Ltd.

b)P.W.12 further deposes that initially Sanjay Jain (A.1) brought two licenses from Rajesh Chopra and he simply packed them in a cover and sent to M/s.Kedia Overseas Limited, Hyderabad, by courier and subsequently payments were received and forwarded to Rajesh Chopra through Sanjay Jain and again two more DEPB Licenses were arranged by Rajesh Chopra and they were dispatched to M/s.Kedia Overseas

Ltd., Hyderabad and one more DEPB license was arranged by Rajesh

Chopra and dispatched to M/s.Kedia Overseas Ltd., and he received payments for two licenses and Sanjay (A.1) received payment for one licence and forwarded the same to Rajesh Chopra and subsequently, he came to know that Sanjay Jain (A.1) is having company by name

Satyam Impex.

61C.C.2/2007/Prl. CBI

Court/VSP

c)He further deposed that in total he received Rs.66,000/- as

Commission/brokerage charges by cash from A.1 Sanjay Jain for the said five licenses and four or six months later he came to know through

P.W.11 that DEPB Licenses are not genuine.

d)Through P.W.12 Ex.P.86 pay order dated 15.1.2003 of Corporation

Bank for Rs.52,00,000/- in favour of Satyam Impex of A.1 and Ex.P.87

Account opening form with photo of A.1 and its enclosures in the name of Sai International of A.1 in ABN AMRO Bank were marked.

e)P.W.10/Mahesh Kumar Kedia, Managing Director of Kedia

Overseas Limited, deposed that the said company installed edible oil refinery plant in the year 2001 at Kakinada and started purchasing crude edible oils through Import from Malaysia and Indonesia from 2000-2001 onwards and the company imports mainly through

Kakinada Customs and they used to clear the imported cargo through cash as well as DEPB license and he looks after the overall management of the company and entrusted the work of purchase of

DEPB Liceses for clearance of imported edible oils in 2002 to his younger brother Jitendra Kumar and Director Damani.

f)He further deposed that Exs.P.64 and P.65 DEPB Licenses were issued by Customs Department to M/s.Global Exports and Sai

International and they were purchased by M/s.Kedia Overseas Ltd., and they contain Bill of entry details signed by Mr.D.S.Narayana on their behalf who is their Customs House Agent. On behalf of Kedia Overseas

Ltd., Through this witness Exs.P.81 to P.85 DEPB Licenses were marked. In respect of these exhibits, P.W.10 deposed that Ex.P.81

DEPB License and TRA., for an amount of Rs.25,52,735/- and this DEPB

License was issued in the name of M/s.Prerna International and sent to 62C.C.2/2007/Prl. CBI

Court/VSP his company by Customs Department of Mumbai and the same was submitted by Customs House Agent Mr.D.S. Narayana for clearance of crude palmolein (edible grade) and Ex.P.82 is Transfer Release Advice sent by registered post to his company by Customs Department in respect of DEPB License issued in favour of Sakshi Impex of A.15 for clearance of customs duty and Customs Agent D.S. Narayana submitted the same for clearance and Ex.P.83 is TRA sent along with

DEPB License in favour of M/s.Paramahans Exports of A.16 through registered post and Ex.P.84 is TRA along with DEPB License issued in favour of Sri Sakshi Impex (A.15) sent through registered post to the company and Ex.P.85 is TRA along with DEPB License issued in favour of Pramahans Trading Company through registered post to the Kedia

Overseas Ltd., Hyderabad.

g)P.W.10 clearly deposed that Jitendra Kumar Kedia (L.W.20) and

P.w.15/Damani purchased the said seven DEPB licenses with its enclosures from two brokers namely Anil Kumar Gupta of Meerut (L.W.16) and Tarachand Chhajed of Thane Mumbai (P.W.12) on commission basis and out of them two were purchased from Anil

Kumar Gupta (L.W.16) and five licenses were purchased from

Tarachand Chhajed and as per their request only necessary documents were forwarded for arranging DEPB License and TRAs., through post and after receiving the seven licenses through Post they were submitted through Customs House Agent D.S. Narayana and Company for clearance of goods and accordingly goods were cleared from

Kakinada Customs office and after acceptance of documents by customs house Kakinada payments were released to the parties through Account payee cheques and D.Ds.

63C.C.2/2007/Prl. CBI

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15)PAYMENTS TOWARDS PURCHASE OF DEPBs:

a)According to P.W.10 Ex.P.71 cheque and Ex.P.72 challan are in respect of obtaining Ex.P.73 D.D., in the name of Paramhans Trading

Company (A.3) for Rs.27,91,155/- towards DEPB License obtained from that company and Ex.P.74 cheque and Ex.P.75 challan are in respect of obtaining Ex.P.3 D.D., in the name of Paramhans Exports (A.16) for

Rs.28,37,658/- towards obtaining of DEPB License from the said

Paramhans Exports (A.16) and Ex.P.76 cheque and Ex.P.77 challan are in respect of obtaining Ex.P.78 D.D., in the name of Satyam Impex for

Rs.87,891/- towards the DEPB License from that company and Exs.P.79 and P.80 are the cheque issued by him as Director of M/s.Kedia

Oversseas Ltd., through Corporation Bank for payment to Overseas

Trader Meerut (L.W.16) and Ex.P.61 was issued by Jitendra Kedia on behalf of Kedia Overseas Ltd., and basing on his company payments in

Corporation Bank, Hyderabad, they issued pay order to the overseas

Trader at Corporation Bank, Meerut (L.W.16) and the said Trader can deposit the same in his own account at his place and his company is maintaining Ex.P.70 account at SBH, Hyderabad and Ex.P.60 account in

UTI Bank. Ultimately P.W.10 deposed that at the end of 2003 or 2004 his company came to know that the seven DEPB Licenses are not genuine after receiving notice from Customs Department but his company made payments bonafidely through acount payee cheques and D.Ds., without knowing about the same.

b)P.W.43/Arun Gupta who is running Yarn business in the name and style of Arun Enterprises at Mumbai and Delhi deposes that A.2 is friend of his father and got acquitance with him since 25 years and he used to do trading business imports and A.2 handed over him one 64C.C.2/2007/Prl. CBI

Court/VSP envelope in Delhi during the year 2004 or 2005 and asked him to handover the said cover to somebody at Mumbai by stating that the said person at Mumbai will call him to receive the cover and accordingly, he carried the cover to Mumbai and handed over the cover to person who called him over the phone through his clerk and the same was informed to A.2 over phone. He was declared hostile.

c)In cross examination for the Learned Public Prosecutor, he deposed that he doesn't remember the name of the person at Mumbai to whom his clerk handed over the cover and he cannot say whether name of the said person is Mustaq Ahmed Choudhary (A.8) and he carried papers handed over by A.2 from Delhi to Mumbai for three or four times and he had not seen the papers in the cover at any time as

A.2 is old friend of his father. Without denying the suggestion he simply deposed as follows:

“I cannot say the documents covered by Exs.P.64, 65, 81 to 85 shown to me now are the documents carried by me from Delhi to

Mumbai on being handed over by A.2 wih request to give the same to Mustaq Ahmed Chowdhary (A.8). He denied the suggestion that he knew Rajesh Chopra of Mumbai from 2003 onwards and that he was introduced to him by A.2 and A.2 introduced him to Mustaq Ahmed Chowdhary of Mumbai (A.8).”

16)WHY QUESTIONED LICENSES ARE BOGUS - REASONS

a)In this connection, P.W.14/M.K. Koushal who worked as FTDO,

License section in the office of Zonal Joint DGFT, New Delhi deposed that Ex.P.88 is attested copy of extract of relevant pages of dispatch register of licenses maintained in the Branch. He explained as follows regarding how and for what reasons Exs.P.81 to P.85 licenses are bogus:

65C.C.2/2007/Prl. CBI

Court/VSP “As per Ex.P.88 DEPB License No.0510071454 dated 28.10.2000 was issued to M/s.Chemico Chemical Private Ltd., Delhi but same number is shown in Ex.P.81.” “As per Ex.P.88 DEPB license No.0510071850 dated 31.10.2002 was issued to M/s.V.K. International Delhi. But as per Ex.P.83 same number is shown. “ “As per Ex.P.88 DEPB license No.0510071452 dated 28.10.2002 was issued to M/s.Wego and Controla Pvt. Ltd., Delhi . But as per

Ex.P.82 same number is shown.” “As per Ex.P.88 DEPB license No.0510071219 dated 24.10.2002 was issued to M/s.East West Traders, Delhi. But as per Ex.P.84 same number is shown.” “As per Ex.P.88 DEPB license No.0510071684 dated 30.10.2002 was issued to M/s.Coral Drugs Pvt. Ltd., Delhi. But as per Ex.P.85 same number is shown.”

b)After mentioning about these disparities with lot of clarity

P.W.14 who is very much competent as FTDO in License section of

Zonal Joint DGFT, Delhi deposed that it is not possible to issue same number to different institutes.

c)P.W.70/IO deposed that Ex.P.158 to P.160 are original DEPB receiving registers for the period from 1.7.2002 to 5.11.2002, 1.4.2002 to 28.6.2002 and 6.11.2002 to 19.12.2002 respectively. Through him

Exs.P.162 to P.200 were marked. Out of them important documents are as follows:

d)Ex.P.162 is computer generated license of DEPB/ advance license No.0510071454 issued to M/s.Chemica Chemicals Pvt. Ltd.,

Delhi. Ex.P.163 is computer generated license of DEPB/ advance license No.0510071850 issued to M/s.Veekay International, Delhi.

Ex.P.164 is computer generated license of DEPB/ advance license 66C.C.2/2007/Prl. CBI

Court/VSP

No.0510071452 issued to M/s.Wago and controls (I) Ltd., Delhi.

Ex.P.165 is computer generated license of DEPB/ advance license

No.0510071219 issued to M/s.East West Traders, Delhi. Ex.P.166 ( ) is computer generated license of DEPB/ advance license

No.0510071684 issued to M/s.Coral Drugs Pvt. Ldt., Delhi.

e)Hence, Exs.P.162 to P.166 licenses which are duly mentioned in

Ex.P.88 extent of dispatch register of licenses show that license numbers in questioned licenses were issued to different companies.

17)EDIT REPORTS & IEC NUMBERS (IMPORTER EXPORTOR

CODE):

a)P.W.14/FTDO, License section in Zonal joint DGFT, New Delhi deposed that Edit report contains IEC number, name of the firm, address and in which year it was established, bank details, PAN number of the company, Director, Proprietor or partner of the firm and their addresses, details of the firm and nature of business.

b)P.W.14 deposed that Ex.P.89 is the edit report of M/s.Paramhans

Exports of A.16 and the same is attested by Smt. Saritha Rani, Foreign

Trade Develoopment Officer and she is also colleague in the office and she used to attend the issue of Importer and Exporter Code number and he identified her signature and to his knowledge she is no more.

c)He further deposed that Ex.P.90 is Edit report of M/s.Sri Sakshi

Impex (A.15) attested by Saritha Rani and Ex.P.91 is the Edit report of

M/s.Prerna International India of A.4 attested by Saritha Rani and

Ex.P.92 is the Edit report of M/s.Lord Empire International of A.6 attested by Smt. Saritha Rani and Ex.P.93 is Edit report of

M/s.Mahalakshmi Handicrafts of A.4 attested by Saritha Rani and 67C.C.2/2007/Prl. CBI

Court/VSP

Ex.P.94 is Edit report of M/s.Lakshmi Enterprises of A.5 attested by

Smt. Saritha Rani and Ex.P.97 is Edit report of M/s. Creative New Delhi attested by Saritha Rani.

d)P.W.14 deposed that as per Exs.P.90,92, P.93 Edit reports they maintained Bank account at Citizen Coopeative Bank Limited, Noida and as per Exs.P.89 and P.91 Edit Reports they maintained Bank account at Lord Krishna Bank, Noida.

e)Ex.P.167 is computer generated Edit report of M/s.Paramhans

Exports (A.16) dated 17.4.2002, IEC No. 0502004029 maintained in computer system of Office of Joint DGFT, New Delhi along with sec.65-B

Certification under Indian Evidence Act.. Ex.P.168 is computer generated Edit report of Shree Sakshi Impex (A.15) dated 13.6.2002,

IEC No.0502018402 maintained in computer system of Office of Joint

DGFT, New Delhi along with sec.65-B Certification under Indian

Evidence Act. Ex.P.169 is computer generated Edit report of Shree

Prerna International India (A.4) dated 22.5.2002, IEC No.0502005173 maintained in computer system of Office of Joint DGFT, New Delhi along with sec.65-B Certification under Indian Evidence Act. Ex.P.170 is computer generated Edit report of M/s. Lord Empire International, Delhi (A.6) dated 4.8.1995, IEC No.0595022006 maintained in computer system of Office of Joint DGFT, New Delhi along with sec.65-B

Certification under Indian Evidence Act. Ex.P.171 is computer generated Edit report of M/s.Mahalakshmi Handicrafts dated 5.1.1999,

IEC No.0599039795 maintained in computer system of Office of Joint

DGFT, New Delhi along with sec.65-B Certification under Indian

Evidence Act. Ex.P.172 is computer generated Edit report of M/s.

Lakshmi Enterprises (A.5) dated 20.7.1998, IEC No.0598020217 68C.C.2/2007/Prl. CBI

Court/VSP maintained in computer system of Office of Joint DGFT, New Delhi along with sec.65-B Certification under Indian Evidence Act. Ex.P.173 is computer generated Edit report of M/s. S.K. Interworld (A.3) dated 10.5.1996, IEC No.0596007469 maintained in computer system of

Office of Joint DGFT, New Delhi along with sec.65-B Certification under

Indian Evidence Act. Ex.P.174 is computer generated Edit report of

M/s.Paramhans Trading Company (A.3) dated 14.6.2002, IEC

No.0502018879 maintained in computer system of Office of Joint DGFT,

New Delhi along with sec.65-B Certification under Indian Evidence Act.

Ex.P.175 is computer generated Edit report of M/s. Creative, Delhi

dated 1.4.1998, IEC No.0588041891 maintained in computer system of

Office of Joint DGFT, New Delhi along with sec.65-B Certification under

Indian Evidence Act.

f)In this connection P.W.14 deposed that Ex.P.95 is IEC number issued in favour of M/s. S.K. Interworld New Delhi of A.3 attested by

Smt. Saritha Rani, Ex.P.96 is IEC number issued in favour of M/s.

Praramhans Trading Company of A.3 attested by Saritha Rani.

g)P.W.14 deposed that in Exs.P.90 and P.93 Edits reports which are in respect of M/s. Shree Sakshi Impex (A.15) and M/s. Mahalakshmi

Handicrafts respectively shows the same address C-13, Mahendru

Enclave, Pin code-110033 and Exs.P.89 and P.91 which are in respect of

M/s.Paramhans Exports (A.16) and M/s.Prerna International (A.4) shows the same address 1/37, Lalitha Park, Lakshmi Nagar, Pincode- 110092 and Exs.P.94 and P.97 Edit reports in respect of M/s.Lakshmi

Enterprises (A.5) and M/s.Creative shows same address A-44, New

Friends colony, East, Pincode-110065.

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h)Nothing useful to the case of defence was elicited from cross examination of P.W.14.

i)The aforementioned testimony of P.W.14 coupled with Exs.P.89 to P.94 and P.97 Edit reports clearly shows that though firms names are different some of the firms addresses are same and four of them maintained accounts at one Bank in Noida and two of them maintained accounts at Lord Krishna Bank, Noida.

j)Further as per the Edit reports date of establishing the firms are 30.3.2002 (M/s.Paramhans Exports) (Ex.P.89), 11.6.2002 (M/s. Sakshi

Impex) (Ex.P.90), 15.4.2002 (M/s. Prerna International) (Ex.P.91) 4.8.95 (Lord Empire International) (Ex.P.92), 15.8.99 (Mahalakshmi

Handicrafts) (Ex.P.93), 1.6.98 (Lakshmi Enterprises) (Ex.P.94), 18.6.84 (Creative)(Ex.P.97). Hence out of them the Proprietory firms under

Exs.P.89, P.90, P.91 were established in March, April and June of 2002 which is soon before the offences alleged in this case.

k)P.W.70/IO deposed that he examined P.W.43 and recorded his statement on 5.10.2005 and that he stated as in Ex.P.130. Ex.P.130 is relevant contradictory portion of sec.161 Cr.P.C., statement of P.W.43.

l)P.W.20 recorded the statement of Rajesh Chopra/Broker.

18)COMPLICITY OF A.7 TO A.9:

a)Whether statements recorded by Customs officials under sec.108 of Customs Act, 1962 during the course of investigation under Customs

Act can be made use against the accused in this case?

b)In this connection, Learned counsel for A.7 to A.9 canvassed that

Exs.P.104, 102 and 105 statements of A.7 to A.9 respectively recorded 70C.C.2/2007/Prl. CBI

Court/VSP under sec.108 of Customs Act, 1962 cannot be used against them in the present case to come to any conclusion and admittedly, a case was registered by Customs Department initially and investigation was conducted relating to the offences committed under Customs Act by the Customs officials with some others and during the course of the said investigation in addition to the recording of statements they conducted searches and prepared panchanamas in that connection and the alleged statements of A.7 to A.9 can be used against them in the said case but they cannot be used by prosecution in the present case and there is a clear prohibition under law and Hon'ble High Court of Allahabad in Criminal Appeal between Mukesh Kumar Gputa Vs.

State of U.P., and another while deciding the bail to be granted held that under sec.138-B of the Customs Act, 1962 statements recorded under sec.108 of Customs Act can only be used in any enquiry or proceedings under the said Act and not in other proceedings.

c)In this connection, for better appreciation of these contentions relevant sections are extracted as under:

108. Power to summon persons to give evidence and produce documents.— (1) Any gazetted officer of customs duly empowered by the Central Government in this behalf, shall have power to summon any person whose attendance he considers necessary either to give evidence or to produce a document or any other thing in any inquiry which such officer is making under this Act.

(2) A summons to produce documents or other things may be for the production of certain specified documents or things or for the production of all documents or things of a certain description in the possession or under control of the person summoned.

(3) All persons so summoned shall be bound to attend either in person or by an authorised agent as such officer may direct; and all persons so summoned shall be bound to state the truth upon any subject, respecting which they are examined or make statements and produce such documents and other things as may be required: Provided that the exemption under section 132 of the Code of Civil Procedure, 1908 71C.C.2/2007/Prl. CBI

Court/VSP (5 of 1908), shall be applicable to any requisition for attendance under this section.

(4) Every such inquiry as aforesaid shall be deemed to be a judicial proceeding within the meaning of section 193 and section 228 of the Indian Penal Code (45 of 1860).

Section 138-B of Customs Act, 1962 reads as follows:

SECTION 138B. Relevancy of statements under certain

circumstances. – (1) A statement made and signed by a person before anygazetted officer of customs during the course of any inquiry or proceeding under this Act shall be relevant, for the purpose of proving, in any prosecution for an offence under this Act, the truth of the facts which it contains, -

(a) when the person who made the statement is dead or cannot be found, or is incapable of giving evidence, or is kept out of the way by the adverse party, or whose presence cannot be obtained without an amount of delay or expense which, under the circumstances of the case, the court considers unreasonable; or

(b) when the person who made the statement is examined as a witness in the case before the court and the court is of opinion that, having regard to the circumstances of the case, the statement should be admitted in evidence in the interests of justice. (2) The provisions of sub-section (1) shall, so far as may be, apply in relation to any proceeding under this Act, other than a proceeding

before a court, as they apply in relation to a proceeding before a court.

d)The learned counsel for A.7 to A.9 placed reliance upon the following observations made by Hon'ble Apex Court in Noor Aga Vs.

State of Punjab and Another in Criminal Appeal 1034/2008

reported in CDJ 2008 Supreme Court 1168 wherein Apex Court observed that:

“Only when these things are established, a statement made by an accused would become relevant in a prosecution under the

Act. Only then, it can be used for the purpose of proving the truth of the facts contained therein. It deals with another category of case which provides for a further clarification. Clause

(a) of sub-section (1) of Section 138B deals with one type of persons and clause (b) deals with another. The Legislature might 72C.C.2/2007/Prl. CBI

Court/VSP have in mind its experience that sometimes witnesses do not support the prosecution case as for example panch witnesses and only in such an event an additional opportunity is afforded to the prosecution to criticize the said witness and to invite a finding from the court not to rely on the assurance of the court on the basis of the statement recorded by the Customs

Department and for that purpose it is envisaged that a person may be such whose statement was recorded but while he was examined before the court, it arrived at an opinion that is statement should be admitted in evidence in the interest of justice which was evidently to make that situation and to confirm the witness who is the author of such statement but does not support the prosecution although he made a statement in terms of Section 108 of the Customs Act. We are not concerned with such category of witnesses. Confessional statement of an accused, therefore, cannot be made use of in any manner under Section 138B of the Customs Act. Even otherwise such an evidence is considered to be of weak nature.”

e)Further, learned counsel for A.7 to A.9 and A.13 urged that almost all the customs officials deposed that they have conducted investigation in connection with case registered under Customs Act and P.W.16 deposed clearly that arrested accused was produced before

Economic offence Court, Mumbai and that the accused have challenged genuineness of the said statements recorded under sec.108 of Customs Act, 1962 and as such, on that ground also prosecution cannot take advantage of those statements and make use of them in the present case when there is clear bar under sec.138(B) of

Customs Act, 1962.

f)At the outset P.W.70/Murugesan who is the main Investigating officer in this case admits as follows in Page No.18:

73C.C.2/2007/Prl. CBI

Court/VSP “It is true that initially Nhava Sheva registered the case and commenced the investigation. It is true that because A.8 and A.9 who are the customs officials committed offences under Customs

Act, a case was registered by Nhava Sheva and conducted searches of their residences. It is true that the disputed DEPBs., and TRAs., were collected initially by Mumbai Customs.

Thereafter, CBI had taken over the relevant seven DEPB scripts with its enclosures, TRAs., etc., from Mumbai Customs. Customs

Mumbai did not ask us to register a case and investigate their case as they intend to transfer it. It is true that our SP did not address any letter to Mumbai customs to transfer their case to him. I do not know when the customs Mumbai completed their investigation and how long they took time for investigation. I do not know whether they filed any charge sheet or not in their case. I have collected statements of A.7 to A.9 recorded by

Customs Officers under sec.108 of Customs Act. It is not true to suggest that only to make use of them in this matter I collected the said statements and those statements were not given by them. Witness adds he made use of those statements along with other materials. I have not collected cash seized by the customs officials from the residence of A.8 as per their panachanama. I am not aware that the statements of A.7 to A.9 were challenged by them before Economic Offences Court,

Mumbai.”

g)Hence, P.W.70/IO never denied the alleged challenge of the statements of A.7 to A.9 before Economic Offences Court, Mumbai. He only deposed that he is not aware of the same. P.W.16/Mr. Nagesh

Aspat who worked as Appraising officer in Special Investigation and

Intelligence Branch, JNCH, Nhava Sheva, Mumbai, categorically admits at page No.7 as follows:

“It is true that the persons whose statements were recorded under sec.108 of Customs Act and who are arrested have challenged the correctness of the statements.” 74C.C.2/2007/Prl. CBI

Court/VSP

h)P.W.16 deposed that during the course of investigation of DEPBs forgery case, Assistant Commissioner along with senior officers of

Directorate of Vigilance formed into different groups of officers as per the directions of Assistant Commissioner and conducted searches in the house of A.8 and during the course of investigation he also recorded statements of A.7, A.8 and A.9 under sec.108 of Customs Act and they have voluntarily written their statements under Exs.P.102 to

P.104. Whereas P.W.18/ P.S. Salian deposed that as per the directions of

P.W.17/ B. Philip Pereira, the then Assistant Commissioner of Customs he did investigation in Customs case and during that investigation A.9 gave Ex.P.105 attested photocopy of statement in his own handwriting.

i)P.W.19/ S.P. Parui deposed that A.13 gave statement in his own hand writing in Marathi language under Ex.P.103 and he had taken assistance of P.W.16 who is conversant in Marathi language. Hence,

Exs.P.102 to P.105 are the statements recorded by respective Customs officials from A.7 to A.9 and A.13. As per P.W.20, the then

Superintendent of Customs in JNCH, Nhava Sheva Mumbai, under the directions of Deputy Commissioner of Customs he issued summons to

Mr. Rajesh Chopra and recorded his statement under the original of

Ex.P.106 under sec.108 of Customs Act and the said Rajesh Chopra given his statement in his own handwriting. Exs.P.102 to P.106 statements which are only photocopies were marked subject to objection that they were not certified as per the provisions of Evidence

Act and they were recorded only during their Departmental investigation and not related to this case. Even then prosecution did not come forward with proper reply in respect of those objections at the time of hearing.

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j)On the other hand, P.W.70 i.e., the main IO in this case deposed that no separate statements were recorded in this case from A.7 to A.9 and A.13. Further P.W.16/Customs Official categorically admits that these statements were challenged in Economic Offences Court,

Mumbai when these accused were arrested and produced before that

Court.

k)When sec.138 (B) of Customs Act, 1962 envisages clear bar to make use of statements recorded under sec.108 of Customs Act, 1962 which is special enactment, in any other proceedings, prosecution cannot simply make use of them in this matter relating to offences under IPC and P.C. Act,1988 but not Customs Act, 1962.

l)That apart in Noor Aga Vs. State of Punjab and another reported in CDJ 2008 Supreme Court 1168 the Hon'ble Apex Court at pages 15 and 16 regarding the confessions under sec.25 of Evidence

Act clearly held that confession statement of an accused under sec.108 of Customs Act cannot be made use of in any manner in view of bar under sec.138-B of Customs Act.

m)Added to that P.W.16 admits that Exs.P.102 and P.104 did not specifically mention that 'informing the person who gave statement or warning him that the statement will be used against him' and he did not examine the persons whose names are mentioned in DEPBs., and he simply explained the provisions of sec.108 of Customs Act and secs.174, 175 and 193 of IPC before recording the statements.

n)In this connection, learned Public Prosecutor placed reliance upon judgment of Hon’be Apex Court dated 3.2.1997 K.I.Pavunny Vs.

Assistant Collector wherein Appeal by special leave came up before 76C.C.2/2007/Prl. CBI

Court/VSP the Bench in pursuance of a reference passed by a two Judge Bench to consider whether confessional statement of Appellant given to the

Customs Officers under sec.108 of Customs Act, 1962 though retracted at later is admissible in evidence and could form basis for conviction and whether retracted confessional statement requires corroboration on material particulars from independent evidence.

o)Factual matrix in that case is as follows:

200 gold biscuits of foreign make were recovered from

Appellant's house by customs officials and the appellant gave in his own handwriting Ex.P.64 confessional statement on the said day before the Customs officials. In the proceedings for confiscation 200 gold biscuits since unclaimed were confiscated. But imposition of penalty was set aside which became final. Thereafter, complaint was filed by

Collector of Customs and appellant was apprehended and released on bail. The prosecution case hinges upon retracted confessional statement, Ex.P.4 confessional statement, Ex.P.3 recovery proceedings and evidence of witnesses for proof of recovery of the contraband from the compound of the appellant's house. The Magistrate by his judgment acquitted the appellant of the charges under sec.135 of the

Act and secs.85 and 86 of Gold Control Act, 1968. On appeal Learned single Judge of Kerala High Court by the impugned Judgment set aside the acquittal and convicted appellant of the aforesaid offence.

p)In that connection, in the Special Leave counsel for the appellant contended that Ex.P.4 confession statement was obtained by coercion and threat implicating his wife and it is not voluntary statement.

77C.C.2/2007/Prl. CBI

Court/VSP

q)In the aforesaid case, prosecution relied upon the following observations in page No.7 :

“In Thomas Dana Vs. State of Punjab (1959) Supp.1 SCR 274 another Constitution Bench was concerned with the question whether conviction under the Sea Customs Act, after confiscation proceedings became final was violative of Article 20 sub-clause 2 of the Constitution (double jeopardy). The constitution bench held that it was not violative of Article 20

Sub-clause 2 since the two proceedings were independent and distinct of each other. One is for confiscation for infringement of provisions of the Act and the second is in respect of charge of criminal offence. Accordingly we have no hesitation to hold that appellant was not accused of an offence when he gave his own handwriting his confession statement Ex.P.4.”

r)There is nothing in the entire judgment that under sec.138-B of

Customs Act, 1962 the statements recorded under sec.108 of Customs

Act can be made use of in proceedings other than the Customs Act. In the case on hand, the offences alleged are under IPC in respect of forgery, cheating and making use of forged documents and the charge of corruption against public servants also under P.C. Act, 1988. Hence, the aforementioned decision is of no avail to the case of prosecution due to the bar created under sec.138 of IPC. Hence, I do not find any force in the argument of learned Public Prosecutor that Exs.P.102 to

P.105 statements of A.7 to A.9 and A.13 recorded by Customs Officers under sec.108 of Customs Act, 1962 can be used in offences of instant case also inspite of the clear bar under sec.138-B of Customs Act, 1962. Hence, by leaving these statements we must analyze the case of prosecution independently.

19)JURISDICTION:

78C.C.2/2007/Prl. CBI

Court/VSP

Though according to the defence this Court is not having territorial jurisdiction since the charge sheet in so many words mentions that by using the fabricated DEPB licenses and corresponding transfer release advices which were sold to M/s.Kedia Overseas Limited who ultimately used the same for clearing and duty exemption for imported goods through Customs House, Kakinada and thus, Customs

House, Kakinada (which is well within the jurisdiction of this Court) was put to loss to the tune of Rs.1,98,78,418/- and corresponding gain to the accused, there cannot be any objection regarding the territorial jurisdiction of the Court. Further, the offences alleged are under IPC and P.C. Act and not under Customs Act. Hence, this Court is very much having the jurisdiction to try the case. Hence, the said objection of the defence has no force.

20)COMPLICITY OF A.7:

a)In this connection as per the contents of charge sheet the only specific allegation made against A.7 is A.9 arranged fabrication and forgery of the questioned DEPB licenses and the corresponding TRAs., with the connivance of A.10 to A.12 and A.7 etc. That apart, in first para of charge sheet the following general allegation is made:

“Investigation establish that the above said A.1 to A.16 have entered into criminal conspiracy during 2002-03 at Delhi,

Mumbai, Nhavesheva, Kakinada etc., to cheat Government of

India.”

b)There is no other whisper in specific as to the alleged role of A.7 in arranging the alleged fabricated and forged DEPB licenses and TRAs.

A.7 is described as employee of M/s.Sainath Forwarders doing work at

JNCH, Nhavasheva. He is not a public servant. Even according to 79C.C.2/2007/Prl. CBI

Court/VSP prosecution he was a Custom House agent doing work at JNCH,

Nhavasheva.

c)Learned Public Prosecutor canvassed that the evidence on record clearly shows that A.7 developed friendship with A.8 and A.9 and conspired with them and filled up the forged transfer release advices involved in this case and forged writings on the backside of the questioned DEPB Licenses and A.7 also acted as middleman between

A.8 and A.9 to facilitate the arrangement of fabricated documents and corresponding payments.

d)In this connection prosecution placed reliance upon the testimonies of P.W.16, P.W.70 and P.W.72 and Exs.P.104 statement, P.64,

P.81, P.65 DEPBs.,, P.214 to P.220, P.233 specimen handwritings and

P.234 (opinion).

e)P.W.16/Nagesh Aspat deposed that he worked as Appraising

Officer in Special Investigation and Intelligence Branch (SIIB),

Jawaharlal Nehru Customs House, Nhavasheva, Mumbai and his duty in

SIIB was to investigate the case and Assessment and Appraisal of

Value of the cargo for the purpose of calculation of duty to be paid and under the then Assistant Commissioner of Customs investigation was carried on in this case and during the course of investigation of DEPB forgery case, Directorate of Vigilance, Mumbai informed the

Department that Officers of Customs were involved in forgery matter and as per the directions of Assistant Commissioner along with the senior officers of Directorate of Vigilance different groups were formed for searching various places for recovering relevant documents and during the course of that investigation he recorded Statements under 80C.C.2/2007/Prl. CBI

Court/VSP sec.108 of Customs Act and Ex.P.104 is the Statement in the handwriting of A.7 under sec.108 of Customs Act.

f)P.W.72/N. Ravi deposed that he worked as Director incharge-cum-

PSO, CFSL, New Delhi and Exs.P.214 to P.220 and P.233 are the specimen handwritings of A.7 and questioned handwriting i.e., Q.16,

Q.31 and Q.48 in Exs.P.64, P.81 and P.65 are that of A.7 and with supporting reasons his opinion was given under Ex.P.234. Ex.P.64 is one of the forged and fabricated DEPB Licenses purportedly issued in the name of M/s.Global Exports Mumbai and TRA issued in favour of

M/s.Kedia Overseas Ltd., Hyderabad. In Ex.P.64 DEPB License at the back of the page the sentence marked as Q.16 is as follows:

“Kakinada Sea Port, to Kakinada Sea Port, Crude Palmolein (edible grade) in bulk” and “Fob value 27933460, CIF value 27933460 and Fob Bal NIL”.

g)Ex.P.81 DEPB license purportedly issued in the name of

M/s.Prerna International India, TRA issued in favour of M/s.Kedia

Overseas Ltd., Hyderabad and at the back of DEPB license Q.31 questioned handwriting is as follows.

“Kakinada Sea Port to Kakinada Sea Port, Crude Palmolein (edible grade) in bulk” and “Fob value 23206679, CIF value 23206679 and Fob Bal NIL”

h)Ex.P.65 DEPB License purportedly issued in the name of M/s.Sai

International, TRA issued in favour of M/s.Kedia Overseas Limited,

Hyderabad, contains the following questioned hand writing under Q.48:

“Kakinada Sea Port to Kakinada Sea Port, Crude Palmolein (edible grade) in bulk” and “Fob value 16308125, CIF value 16308125 and Fob Bal NIL” 81C.C.2/2007/Prl. CBI

Court/VSP

i)P.W.70 deposed that he obtained specimen handwritings of A.7 under Exs.P.214 to P.218 in the presence of witnesses and identified his signatures in Exs.P.214 to P.218.

j)Learned public prosecutor submitted that these questioned handwritings and signatures of A.7 at the back of Exs.P.81 and P.65

DEPB Licenses were proved through Ex.P.234 opinion and P.W.72/Expert evidence and as such, the complicity of A.7 in this case in fabrciating and forging DEPBs., and TRAs., along with other accused is established.

k)Learned counsel for A.7 urged that evidence adduced by prosecution against A.7 is not at all sufficient to conclude that he has committed the offences alleged against him and in addition to the evidence of P.W.16 that he recorded statement of A.7 under Ex.P.104, the only evidence available for prosecution is that of P.W.72

Handwriting Expert and P.W.16 did not depose anything against A.7 except stating that he recorded Ex.P.104 statement and prosecution ought to have elicited the alleged role of A.7 and investigation disclosed against A.7 through P.W.16, but nothing of that sort happened and Ex.P.104 statement cannot be used in this case and mere marking of A.7 through P.W.16 is not sufficient to prove the contents in the statements and moreover, it is inculpatory statement.

l)Learned counsel for A.7 further submitted that the specimen handwritings of A.7 were not obtained by IO in Court and they were not obtained before any independent witness and A.7 denied of giving specimen writings and even P.W.72 expert admitted non obtaining of admitted handwritings of A.7 and when none of the witnesses referred the name of A.7 and there is no evidence to show that A.7 in 82C.C.2/2007/Prl. CBI

Court/VSP conspiracy with other accused prepared bogus DEPBs., and made money illegally in the absence of corroboration no importance can be given to the sole testimony of P.W.72/Expert and Ex.P.234 opinion and as such, A.7 is liable to be acquitted.

m)In the light of this, Exs.P.214 to P.220 and P.233 alleged handwritings and signatures of A.7 collected by P.W.70/IO contains name of one Srinivasa Rao at the end. The details as to What is his status, whether he signed as witness to the obtaining of handwritings are not mentioned. The said Srinivasa Rao was not examined. That apart excluding Ex.P.104 statement recorded by Customs officials, which cannot be usd in this case, there is absolutely no evidence regarding the alleged role of A.7 and nexus with DEPBs. No conviction can be based on the sole opinion of expert without any corroboration.

Hence, prosecution miserably failed to prove the offence alleged against A.7 undersec.120-B, 420 and 471 of IPC. I answer the pint accordingly.

21)COMPLICITY OF A.8 :

a)Specific overt acts alleged against A.8 in final report are A.2 had dishonestly and fraudulently arranged forgery of DEPB licenses and th corresponding TRAs., with the help of the then officials A.8, UDC of New

Customs House, Mumbai and A.7, LDC of JNCH, Nhava Sheva and others and the said documents which were given to A.8 for fabrication were handed over to A.9 to get them fabricated as if they are verified/registered at JNCH by using his influence and accordingly, A.9 fabricated and forged them with connivance of A.10, A11, A.12 and

A.7.

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b)Per contra learned counsel for A.8 vehemently submitted that A.8 public servant was kept under suspension after arrest by customs officials relating to customs case and by 2007 i.e., the year of taking cognizance of this case by this Court he was still under suspension and it is for P.W.70/IO who filed the charge sheet to explain why he has not obtained prosecution sanction order against him and A.8 cannot be tried in the absence of sanction order which is mandatory and even

Ex.P.102 statement recorded under Customs Act cannot be used against A.8 in this case when it is clearly prohibited under sec.138 B of

Customs Act, 1962.

c)The testimony of P.W.16 is crucial in this connection. According to P.W.16/Nagesh Aspat he and his team conducted investigation in connection with a case registered by Directorate of Vigilance, Mumbai and conducted searches at various places including the residential premises of A.8 under the directions of Assistant Commissioner of

Customs, SIIB, JNCH, Mumbai. He further deposed that during the said search they found Rs.3,50,000/- of cash, one Mercedes Benz Car, relevant documents of Export Shipping Bills and one diary in the residence of A.8 and they were seized under Ex.P.98 panchanama

dated 2.7.2003 and the said panchanama was carried out in the

presence of two panch witnesses and Ex.P.99 Diary seized during the search contains phone numbers of different persons and Ex.P.100 is separate panchanama prepared on 10.7.2003 in respect of the amount of Rs.3,50,000/- seized under Ex.P.98 and he also recorded Ex.P.102 statement in the handwriting of A.8 under sec.108 of Customs Act.

d)P.W.21/ S.S.Ambegaokar deposed that he assisted during the search proceedings conducted in the residence of A.8 along with two 84C.C.2/2007/Prl. CBI

Court/VSP independent witnesses Mr.P.K. Manik and R. Johnson who are neighbours of A.8 and during the search proceedings they seized

Ex.P.101 and other documents as mentioned in Annexure of Ex.P.98.

e)Is this evidence in respect of searches and seizure in the house of A.8, Exs.P.98 to P.100 panchanamas, cash and diary (Ex.P.9) and

Ex.P.102 statement issufficient for the prosecution to prove charges against A.8 beyond reasonable doubt and whether A.8 has any nexus with the alleged bogus DEPBs., Exs.P.64, P.65 and P.81 to P.85 are to be analyzed.

f)Since Ex.P.102 statement of A.8 recorded under sec.108 of

Customs Act is prohibited for using in this case under sec.138-B of

Customs Act, 1962 as mentioned surpa and the confession statement recorded under sec.102 led to the searches in his residence and seizure of cash, car, documents and diary, consequently they also cannot be valid in this case and conviction cannot be based on the said material. Further, even according to P.W.70/IO the alleged cash of

Rs.3,70,000/- and car were neither collected from the customs officials nor produced in Court and they cannot form any basis for conviction against A.8.

g)Leave alone bar under sec.138-B of Customs Act, 1968 prosecution did not even try to elicit the contents of Ex.P.102 statement recorded by P.W.16 and what material was found against

A.8. P.W.16 simply deposed that he recorded statement, conducted searches and found cash, car, documents and diary but failed to explain the contents of Ex.P.102 statement or Exs.P.98 to P.100 panchanamas etc., as contended by the accused. When Exs.P.98 to

P.100 search proceedings and seizures and alleged Ex.P.102 statement 85C.C.2/2007/Prl. CBI

Court/VSP of A.8 are barred from using in this case, there absolutely no material against A.8 to establish that A.8 helped in fabricating the DEPBs., as alleged. Though P.W.43 was examined to prove that A.2 handed over covers containing questioned DEPBs., to hand over the same to A.8 in

Mumbai, he turned hostile. In cross examination of learned P.P., also he deposed that though he carried papers handed over by A.2 three or four times to Mumbai, he did not personally handed over to that person and his clerk delivered to that person whose name he doesn’t know and he had never seen the papers in the cover. The testimony of

P.W.43 is of no avail to the case of prosecution.

h)Be that as it may P.W.25/S.G.Mendonca who assisted P.W.16 in searches and scribed Ex.P.100 admits in cross examination as follows:

“Ex.P.98 proceedings conducted during the investigation of the case under Customs Act no way related to the present case.”

i)P.W.70/IO failed to collect the entire case record from the Court of Economic Offences and there is no reason as to why P.W.70 only collected alleged statements leaving the entire case file of customs.

Further, P.W.70 admits in cross examination that customs officials did not entrust the case to CBI, Chennai for investigation. When that is so there is no need for CBI, Chennai, for relying upon their statements without conducting fresh investigation by recording separate statements in that connection.

j)Viewed in any angle there is no evidence worth considering against A.8. Hence, prosecution miserably failed to prove the offences alleged against A.8. Hence, A.8 is liable to be acquitted for the offences under secs.120-B, 420,471, 201 r/w 34, 411 r/w 34 of IPC and sec.13(1)(d) r/w 13(2) of P.C. Act, 1988.

86C.C.2/2007/Prl. CBI

Court/VSP

22)ALLEGED CREATION OF DATE BASE FOR FABRICATING THE BLANK PRINTED LICENSE FORMS:

i)MODUS OPERANDI & COMPLICITY OF A.9 :

a)Specific allegation made against A.9 in final report is A.2 had dishonestly and fraudulently arranged forgery of questioned DEPB licenses and corresponding TRAs., with the help of A.8 and A.9 and the said documents given to A.8 for fabrication by A.2 were handed over to

A.9 with a request to get the said licenses fabricated as if they are verified/registred at Nhava Sheva Customs House using his influence and A.9 then arranged fabrication and forgery of DEPBs., and corresponding TRAs., with the connivance of A.10, A.12, A.11 and A.7.

b)A.9 emphatically denied the same.

c)As mentioned supra, P.W.18/P.S. Salian allegedly recorded statement of A.9 under Ex.P.105 under Customs Act and there is bar for using the same against A.9 in this case and according to I.O., no separate statement of A.9 was recorded in this case. Prosecution relied upon the sole testimony of P.W.28 to prove the alleged fabrication and forging of DEPB by A.9. Now we shall see whether testimony of P.W.28 inspires any confidence and whether conviction can be based on sole testimony of P.W.28.

d)P.W.28/Dilip Ganpat Dalvi is sheet anchor of the case of prosecution who allegedly fabricated DEPBs., at the dictation of A.9.

According to P.W.28 he has been doing computer maintenance contracts on call basis for the last 17 years and studied diploma in

Mechanical Draughtsmen.

87C.C.2/2007/Prl. CBI

Court/VSP ii)PRIOR ACQUAINTANCE BETWEEN A.9 AND P.W.28:

a)Regarding prior acquaintance with A.9 he deposed that A.9 also did same course along with him in Advanced Training Institute, Kurla,

Mumbai and he knew him of just before completion of the said course

A.9 got Government job in Nhava Sheva, Customs House as Clerk and thereafter he met A.9 in marriage of their common friend at Vikroli in 2002 and in the said marriage when A.9 enquired about his livelihood he informed that he was doing Hardware work and A.9 enquired whether he was interested in doing data work of Customs Office and when he expressed interest in doing that work, A.9 called him in the month of November or December, 2002 and asked him to come to his house to discuss about that customs work.

b)P.W.28 further deposed that when he visited the room of A.9 in

Vashi area he informed that he had to attend that Customs work in the said room itself and A.9 dictated the information and accordingly he created a data base and carried out the work on his dictation and A.9 used to verify the work and to take prints after carrying out the corrections and pay him Rs.8/- per page. He also deposed that he used to have printed blank DEPB Licenses in bunches consisting of 8 to 10 and dictate on the basis of DEPB Licenses and he prepared data base for DEPB Licenses as per the directions of A.9 to suit the filling of blanks in the said licenses and he had not printed DEPB Licenses and to his memory he prepared data base for Kedia Overseas Limited for seven or eight DEPB Licenses and he doesn't remember the other details.

c)He further deposed that A.9 used to bring blank licenses and dictate the name, details, amount and other particulars mentioned in 88C.C.2/2007/Prl. CBI

Court/VSP the licenses and he used to prepare the data base according to his needs and evey time he used to direct to keep blank at right top of

Release Advices so that he can fill up the same later manually and all the details in the Release Advices were given by A.9 in the questioned

TRAs., and DEPBs and format is same for all Release Advices and after taking prints A.9 used to delete the file and A.9 called him only during the holidays and after completion of the day's work A.9 used to take print of the copies.

d)He also deposed that for so many DEPB Licenses apart from

Kedia he prepared data base and one Nitin (A.14) Sandeep Joshi (A.12)

Mr. Vedam (A.11) used to accompany A.9 many times to that room and

Ex.P.99 Diary of A.9 discloses his name and phone number along with the phone numbers of college mates.

e)In cross examination he deposed as follows:

“Approximately 50 DEPBs., were prepared by me including seven this case. I prepared the seven DEPBs., on different dates along with other DEPBs. I have filled up first five pages of Ex.P.65 . On dictation of A.9 I filled up all the DEPBs. Customs officials called

DEPBs., approximately in 2003 and recorded my statement.

Except the name of Kedia, I do not remember any other names or details in Exs.P.64, P.65 and P.81 to P.85. Witness volunteers that he prepared so many database with different names.” iii)PURPOSE:

Regarding the purpose of preparing database P.W.28 deposed that when he asked about purpose of preparing the data base, A.9 told him that same work he was supposed to do in his office but he had no time and he had to submit this work as soon as possible and as such the work of filling up the columns on his dictation was done by 89C.C.2/2007/Prl. CBI

Court/VSP him. He admits that by the date of doing the said work by him he knew that these papers belongs to Government. He could not say the door number of the said room of A.9 and owner of that room wherein he did the said work of filling release advices and DEPBs.

iv)HOW NAME OF P.W.28 SURFACED:

P.W.70/IO at page 18 deposed that during his investigation customs officials revealed the name of P.W.28 and A.9 also revealed his name during interrogation and except A.9 and Customs officials none others referred to the name of P.W.28 during investigation and he doesn’t remember whether customs officials recorded statement of

P.W.28.

v)P.W.28 ALLEGEDLY PREPAED DEPBs OR TRAs:

a)P.W.70 with lot of clarity deposed that P.W.28 prepared only

TRAs., but not DEPBs. But as mentioned supra P.W.28 deposed that he prepared both DEPBs., and TRAs. Hence, there is inconsistency as to what was prepared by P.W.28 though that itself is a crucial fact.

b)From the testimony of P.W.70/IO it is clear that he did not do independent investigation about A.9 and P.W.28 and he just relied upon the information of Customs officials. He deposed that he did not collect any proof to show that P.W.28 was attending work regularly at

Alpha Data Processing Pvt. Ltd., and DEPBs., and TRAs., in this case were initially collected by Customs Mumbai and CBI had simply taken them from Customs, Mumbai. Hence, P.W.70/IO did not conduct proper investigation about alleged involvement of P.W.28 and A.9 in this connection.

90C.C.2/2007/Prl. CBI

Court/VSP

c)Be that as it may, engaging P.W28 for small work of filling few blanks in DEPBs., and TRAs., is quite strange. As admitted by P.W.20/IO none of the witnesses whispered about P.W.28 except A.9. That apart

P.W.28 made many improvements as follows in 2nd para page 5 of his deposition :

“It is true that I omitted to state Sajit Khan enquired me whether

I am interested in doing data work of Customs Office and I told him that I am interested to do that work in 161 statement. It is true that I omitted to state that he asked me to come to his house to discuss about the Customs Work in 161 statement. It is true that I omitted to state that he dictated in the information and I created a Data base and carried out the work on his dictation and he used to pay me Rs.8/- per page and he used to dictate on the basis of DEPB licenses and he used to have DEPB licences printed blank in some bunches consist of 8 to 10 and he used to dictate the name, details, amount and other particulars mentioned in the licenses and I used to prepare the date base according to his need in 161 statement. Witness adds he mentioned the words “particulars given by hm” in 161 statement. It is true that I omitted to state that he used to take the print of the copies in 161 statement. Witness adds finally point out was taken by Sajit Khan are mentioned in 161 statement.”

d)The aforementioned facts throw strong suspicion upon the veracity of P.W.28 and his testimony do not inspire any confidence. No nexus between A.9 and alleged fabrication and forging of DEPBs., and

TRAs., can be inferred or concluded from the testimony of P.W.28.

There is no other evidence against A.9. Hence basing on his sole testimony, A.9 cannot be convicted for the offences alleged.

Prosecution miserably failed to prove the guilt of A.9 under secs.120-B, 91C.C.2/2007/Prl. CBI

Court/VSP 420, 471, 201 r/w 34, 411 r/w 34 of IPC and sec.13(1)(d) r/w 13(2) of

P.C. Act, 1988.

24)BULLETIN AND RUBBER STAMP USED IN THE BULLETIN:

a)P.W.60/R.D.Moree who worked as Assistant Commissioner of New

Customs House, Mumbai from 2002 to 2005 deposed that he handed over bulletin verification rubber stamp pertains to 2002 of License section and certified extract of Bulletin verification register to CBI belongs to 2002-2003. He further deposed that he signed in Ex.P.136 bulletin verification rubber stamp and attested the entries in Ex.P.133 certified copy of bulletin verification register for the year 2002 and handed over Exs.P.136 and P.133 to CBI.

b)Regarding rubber stamp he repeated in cross examination also that he handed over the same to CBI and denied the suggestion that it was not the rubber stamp used during the year 2002.

c)P.W.61/N.S.Vanakore who worked as Superintendent in License section in New Customs House, Mumbai, from October 2000 to March, 2004 deposed that Exs.P.64, P.65, P.81 to P.85 DEPB Licenses contains bulletin verification rubber stamp but they are not office stamps and he did not initial in them though his duty during that time was all over supervision and administration of License section and counter signature on all bulletin verification licenses etc., and as per Ex.P.133 license No.60339 was entrusted to Frontier Cycle, 63057 was allotted to Zaveri, 63056 was allotted to Archies, 63055 was allotted to

Ranbaxy, 63909 was allotted to S.K. Silks, 63065 was allotted to Curu and entry in S.No.60939 was allotted to Parekh and his initials were collected by CBI under Ex.P.44 for sending them to expert. Further 92C.C.2/2007/Prl. CBI

Court/VSP

Exs.P.145 and P.146 C.Ls., application containing the signatures of

P.W.61 and Ex.P.147 R.H. application containing the signature of P.W.61 and Exs.P.148 and P.149 C.Ls., application of Tarun P. Lulla (P.W.47) containing his signatures under Exs.P.148 and P.149 were identified by

P.W.61.

d)He clearly deposed that he had never seen the seven questioned licenses during his tenure in New Customs House, Mumbai and they are not genuine because they did not contain stamp of section and his initials.

e)He denied the suggestion that the questioned licenses are genuine documents and he signed in them and supplied by Nasik press.

25)BULLETIN NUMBERS IN Ex.P.133 BULLETIN REGISTER – WHETHER TALLIED WITH QUESTIONED DEPB LICENSES:

a)The next important witness is P.W.47/Taruna P. Lulla who worked as UDC in License section, New Customs House, Mumbai from August, 2001 to April, 2003 and according to him his duties are to verify the bulletin issued by DGFT showing the details of licenses and in the absence of bulletin register verification of signatures of officers of

DGFT on the basis of specimen signatures received from DGFT.

b)Through P.W.47, Exs.P.133 to P.137 were marked. He deposed that Exs.P.64,65,81 to 85 DEPB licenses are not found in Ex.P.133 attested photocopy of bulletin register, New Customs House, Mumbai and Bulletin numbers mentioned in Exs.P.64 and 65,81 to 85 (questioned DEPBs in this case) were allotted to other companies. He further deposed that bulletin number found in Ex.P.64-A license was allotted to Parekh, Brightvares but not to M/s.Global Exports and 93C.C.2/2007/Prl. CBI

Court/VSP bulletin number found in Ex.P.65-A license was allotted to S.K. Silks but not to M/s.Sai International and bulletin number found in Ex.P.81 license was allotted to Frontier Cycle Industries Ltd., but not to Prerna

International Ltd., and it is DFRC License but not DEPB license and bulletin number found in Ex.P.82 was allotted to Orchids but not to Sri

Sakshi Impex and Bulletin number found in Ex.P.83 was allotted to

Zaveri Export but not to Paramhans Exports and bulletin number found in Ex.P.84 license was allotted to Ranbaxy Labs Limited but not to Sri

Sakshis Impex and bulletin number found in Ex.P.85 license was allotted to Guru EXIM Pvt. Ltd., but not to Paramhans Trading Company.

c)He further deposed that since none of the bulletin numbers in the seven questioned DEPB licenses are tallied with Ex.P.133 bulletin register they are Bogus and he gave Ex.P.134 specimen initials and

Ex.P.135 specimen handwritings and initials or signatures in bulletin stamps on the reverse of seven questioned licenses are not that of him and even bulletin stamps used on the reverse of these seven questioned licenses are not bulletin stamps used in New Customs

House, Mumbai and they are not genuine and Ex.P.136 is specimen bulletin stamps collected by CBI from New Customs House, Mumbai and Ex.P.137 is only covering letter of Asst. Commissioner of Cutoms,

Vigilance Section, dated 28.4.2005 to Inpsector of Police, CBI, containing the initials.

d)In cross examination he clearly deposed that record section of

New Customs House, Mumbai provides bulletin stamps to License section and during his tenure in License section bulletin stamps were not changed. He strongly denied the suggestion that Ex.P.133 photostat copies are not obtained from original bulletin register 94C.C.2/2007/Prl. CBI

Court/VSP maintained in New Customs House, Mumbai and the specimen bulletin stamps covered under Exs.P.136 are not original bulletin stamps used at New Customs Mumbai. At page No.4 it was elicited that particulars of DEPB Licenses and TRAs., will be saved in EDI system by data entry operator of the Department and this is in addition to maintaining of bulletin register. Nothing useful to the defence was elicited from his cross examination.

26)WHETHER T.R.As. IN QUESTIONED DEPBS’ WERE ISSUED:

a)P.W.48/D.K.Jain who worked as Appraising Officer, JNCH, Nhava

Sheva from June, 2002 to June, 2003 and incharge of TRA issue section and DEPB verification during that tenure deposed that his duty was to verify DEPB License issued by DGFT and issue TRA in respect of DEPB

License produced by Importers or their representatives and the signatures on Exs.P.64,65 and 81 licenses are not that of him and he did not issue TRAs., found in Exs.P.64, P.65 and P.81 files and Ex.P.138 contains his specimen signatures collected by CBI.

b)Regarding procedure for passing of DEPB license he deposed that

Importer or his representative submits the license along with concerned shipping bills, invoices and packing list to the concerned ministerial staff at DEPB section in JNCH and they verify and enter the details in the register and if the shipping bills are manual then files will be transferred to the concerned examining officer and if the shipping bills are EDI then they are transferred to the Appraiser and examiner will do all verification regarding admissibility of DEPB and put up the same to the concerned Appraiser and the said Appraiser once again do all the verification, admissibility and put up his signatures and forward the same to his Assistant or Deputy Commissioner who again 95C.C.2/2007/Prl. CBI

Court/VSP verify everything including admissibility and put his signatures and thereafter file will be transferred to the concerned Ministerial staff who enters the details in respective registers and computer system and handover the file to Importer or his representative.

c)Regarding the issue of TRAs., he deposed that in case some importers ask for TRA against the DEPB already verified by the

Department they have to apply to TRA section and clerk in TRA section verifies the admissibility and put up to the concerned Appraisal Officer who verifies the admissibility and put his signature and transfer the file to his Assistant or Deputy Commissioner who again verifies the admissibility and put his signatures in the file and thereafter entries will be made in computer system by the concerned clerk and TRA will be handed over to the Importer or his representative.

d)He categorically admits that TRAs., found in Exs.P.64,P.65 and

P.81 files were not issued by him and as such they are forged. In cross of examination of P.W.48 nothing useful to the case of defence was elicited.

27)COMPLICITY OF A.13/CUSTOMS SEPOY NO.60 – ALLEGED THEFT OF TRA REGISTERS:

a)The case of prosecution in respect of A.13 is A.8 after arranging forgery and fabrication of documents in connivance with A.14 stolen

TRA Registers pertaining to the relevant period on the night of 18.4.2003 with the help and connivance of Customs Sepoy No.60/A.13 who was on security duty in the night of 18.4.2003 to PUB (Port Users

Building), Custom office, apart from guarding the control room of JNCH, for destruction of evidence and A.13 while he was on duty during that night has abused his official position as public servant and facilitated 96C.C.2/2007/Prl. CBI

Court/VSP

A.8 and A.14 to enter Custom house for removal of TRA registers pertaining to the questioned TRAs., involved in this case from correspondence section of License section.

b)A.13 emphatically denied the said allegation.

c)Ex.P.153 is sanction order issued by P.W.64 against A.13 to prosecute him.

d)Prosecution relied upon the testimonies of P.Ws.16, 40, 52 and 53 in this connection.

e)P.W.40/Santosh Dattu Jadhav who worked as sepoy No.24 in

Cusstoms House Mumbai deposed that there are 22 to 25 points where

Sepoys of the Customs will be posted every month and for the month of April, 2003 he was posted to work at PUB (Port Users Building) as a guard and Ex.P.126 attested copy of office order discloses the said fact and he was not in night duty on 18.4.2003 due to ill health and he doesn't know who was deputed in his place and generally, control room guard will be deputed to work in the absence of guard at PUB and

A.13/Sepoy No.60 was posted as night guard at Control Room.

f)In the entire evidence of P.W.40 he never mentioned that A.13 was officially posted at PUB on the night of 18.4.2003. Further there is no evidence to show that though P.W.40 was posted to guard PUB in the month of April, 2003 on the night of 18.4.2003 he could not come for duty due to ill health.

g)On the other hand he admits in cross examination that information regarding deputing of guard in the absence of another guard will be entered in a register and attendance register will be 97C.C.2/2007/Prl. CBI

Court/VSP maintained in the Control room under the control of Preventive Officer and guard who posted at control room has to guard entire JNCH building which is separate from PUB.

h)P.W.52/Peeyush Kamal Kumar Pandey who worked as

Superintendent, Preventive Service Officer, JNCH, Nhava Sheva deposed that Ex.P.126 is attested copy of office order dated 3.4.2003 containing postings of sepoys from 4.4.2003 to 30.4.2003 throughout the jurisdiction of NSCH and Sl.No.11 in Ex.P.126 contains posting of

Sepoy bearing Buckle No.14 as Draw Back/P & E. Witness identified

A.13.

i)He deposed in chief examination that in case if any sepoy is absent as posted due to emergency, situation will be tackled as per the available man power resource by alternate arrangement.

j)He admits in cross examination that control room was housed in first floor of new building at that point of time and new building is a seven storied building with three wings A,B,C and approximately 50 offices were located in the new building. He deposed that Ex.P.126 contains Note Nos.3 and 4 to the effect that Sepoy posted for PUB guarding has to keep extra vigil for the safety of the computer room and he should ensure that collapsable grill installed opposite to the lift at first floor is closed every day after the Officers and staff leave and should be opened only after the staff arrives in the morning. He further deposed that handwriting in Foot Note portion of Ex.P.126 regarding Sepoys posted for guarding duties in Control Room should guard the New Building in addition during night duties is that of him. At page No.4 he further deposed that PO will be incharge of Control room and could not say who worked as PO during the period covered by 98C.C.2/2007/Prl. CBI

Court/VSP

Ex.P.126 and order of P.Os., may contain which PO was posted at

Control Room and who was incharge of entire premises and though there were 51 Superintendents during that time they were not available during night time duties due to lack of sufficient

Superintendents.

k)In Ex.P.126 office order which is computer typed there is absolutely no reason as to why P.W.52 should incorporate in his own handwriting a note above three foot notes particularly that Sepoys posted for guarding duties in control room shall also guard the new building during night duties. No attempt was made to give any explanation in this connection.

l)P.W.53/Deepak Dhoke, who worked as Preventive Officer at JNCH,

Nhava Sheva, from March, 2003 to June, 2005, deposed that his duty was guarding duty for gates on monthly rotation basis and some times examining officer for export goods and during April, 2003 he worked at

Container gate and during night duty as Preventive Officer at that point he had to check the Containers i.e., Entry and Exit through that gate and duties of Preventive Officer posted at Control Room are to take telephonic messages and deliver the said messages, if necessary and be alert in case of emergency situations and Sepoys and preventive

Officers will be posted at Control Room and in the absence of Sepoy,

Control Room officer can allot additional charge to the nearby sepoy.

m)The aforementioned evidence of P.W.53 is general and not particularly in respect of A.13 or his alleged additional duty of guarding

PUB also on 18.4.2003. Hence, his evidence is not of any use to the prosecution. The very fact that according to the own evidence of Sepoy

No.24 that he infact was posted for night duty at PUB on 18.4.2003 but 99C.C.2/2007/Prl. CBI

Court/VSP he was absent due to ill health and generally control room guard will be deputed in the absence of guard at PUB is not supported by any evidence. More particularly without any evidence as to the absence of

P.W.40 who was the actual person posted at night duty to guard PUB office it cannot be said that A.13 attended the said duty also in view of the note in the handwriting of P.W.52 incorporated in computerized office order and on the face of it, it is suspicious and cannot be believed.

n)Coming to the evidence of P.W.16 who allegedly recorded his statement of A.13 under Ex.P.103 which is in the handwriting of A.13, as mentioned supra, since the said statement was recorded under sec.107 of Customs Act it cannot be used in this case against him.

Hence, prosecution cannot rely upon Ex.P.103 statement and contend that A.13 facilitated A.9 and A.14 to commit theft of TRA registers pertaining to the relevant registers.

o)P.W.40, P.W.52 and P.W.53 categorically admits that control room duty is heavy duty and guard at control room continuously attends phone calls. Hence, it cannot be said that A.13 being guard at control room simultaneously attended the guard duty even at New building.

Further control room is situated in First floor of JNCH Building which consists of more than 150 office rooms and PUB building is far away from the control room as per the material on record. Hence, it is unnatural and absurd that A.13 who was sepoy at guarding point control room was instructed to guard PUB also. It is categorically admitted by P.Ws.40,52 and 53 that there will be registers like

Attendance Register, Stationery diary etc., in the control room and any information about deputing another guard in the absence of guard 100C.C.2/2007/Prl. CBI

Court/VSP posted at any point will be entered in the register. But prosecution neither seized nor produced the said registers to show that A.13 was posted at PUB also upon the instructions in addition to his duty. Even

P.W.70/IO admits that he neither verified the said registers nor seized and produced before the Court. P.Ws.52 and 53 are not preventive officers at the control room to speak about the presence of A.13 at that room or PUB on 18.3.2003. It is alleged that L.W.86/R.L. Atigre is the

Preventive Officer posted at the Control room who allegedly instructed

A.13 orally to guard PUB. But he was not examined by the Prosecution.

P.Ws.40,52 and 53 did not state that they actually seen A.13 either at

PUB or at Control room.

p)Hence, Ex.P.126 and the testimonies of P.W.16,40,52 and 53 do not inspire any confidence regarding the alleged act of A.13 in facilitating A.9 and A.14 to commit theft of TRA registers. That apart

P.W.47 and other customs officials admits that all particulars of DEPB

Licenses and TRAs., will be entered in DEPB Bulletin Registers,TRA

Registers and in turn the particulars in these two registers are storied in Electronic Data Information (EDI) system and genuineness of DEPB

Licenses and TRAs., will be checked by using the EDI system and there is no necessity for verifying the manual TRA Registers and when the said fact is known to all the staff of licensing wing of customs office, there is absolutely no necessity for removing or committing theft of

TRA registers for destruction of evidence since it do not serve any purpose.

q)Viewed in any angle, the aforementioned testimonies and

Ex.P.126 do not establish the offence alleged against A.13/Sepoy.

101C.C.2/2007/Prl. CBI

Court/VSP

Hence, A.13 is liable to be acquitted for the charges levelled against him.

28.KAKINADA CUSTOMS – UTILIZATION OF QUESTIONED DEPBs & T.R.As:

a)Important witness in this connection is P.W.45/ M.A. Andrade the then Assistant Commissioner of Customs, Mumbai. He deposed that on receiving information about forgery of DEPB scripts and benefits were claimed at Jawaharlal Nehru Customs House, Nhava Sheva, the Joint

Commissioner G. Ravindranath instructed him and another officer by name I.Carleiro, Superintendent of Customs and Excise to go to

Kakinada Port and inspect all the DEPB licenses which were transferred to that Port under TRAs., and accordingly they inspected all the files and noticed that seven DEPB Licenses were forged and there was no stamp in the seven licenses.

b)Through him Ex.P.131 attested photocopy of register of DGFT,

New Delhi from 2.6.2000 to 26.9.2001 and Ex.P.132 file of Zonal

Headquarters, DGFT relating to transfer of DEPB scripts to Zonal units of DGFT were marked. He further deposed at page no.3 that the TRAs., and DEPB scripts were forged on comparison of bulletin stamp available on reverse and they are not tallied with stamp used by the

License Department of New Customs House, Mumbai and he also compared the questioned TRAs., and scripts with the list given to him by JNCH, Nhava Sheva, Mumbai and these numbers were not found in the said list.

c)PW.46/R.R. Broker who worked as Deputy Commissioner of

Customs in SIIB (imports), JNCH, Nhava Sheva, from 2004 to

December, 2004 deposed that Exs.P.64,65,81 to 85 are the seven files 102C.C.2/2007/Prl. CBI

Court/VSP containing fake and fabricated DEPB Licenses and TRAs., utilized at

Customs House, Kakinada for clearance of imported cargo and during his tenure investigation went on with regard to these Licenses. It was elicited that Customs Department initially registered case under the provisions of Customs Act and investigation was done to recover duty forgone and penalty as several licenses fond fake.

d)P.W.33/Y.V.Satyanarayana who worked in different capacities in

Customs and in particular Superintendent Appraising, Customs House,

Kakinada, from 2000 to 20004 deposed about the EXIM policy and what are DEPBs., and TRAs.

29)CLEARING AND FORWARDING ASSISTANT IN

D.S.NARAYANA AND COMPANY PVT. LTD. CUSTOMS AGENT:

a)According to P.W.32 since 1991 he worked as incharge Clearing and Forwarding work in D.S.Narayana and Company Pvt. Ltd., during 2002-2003 and the said company deals with clearing and forwarding agency work i.e., submission of documents in customs and Port on behalf of Importer or Exporter and for the said purpose the procedure is they have to get the documents from Importer or Exporter for filing necessary bills of entry/shipping bills, for importing of goods from

Foreign countries and Exports of goods from India to Other countries and after filing of bills of entry Customs will assist Bills of Entry for import of goods from the vessel and also processing Shipping bills for

Export of goods on behalf of Exporter and after getting passed the bills of entry by the Customs they have to clear the goods from ship to intended warehouse of Importers and clear the goods from the said warehouses as and when required and they have to pay applicable duties on imported goods on behalf of importer by way of D.Ds., 103C.C.2/2007/Prl. CBI

Court/VSP favouring Superintendent of Central Excise, Incharge Customs House,

Kakinada and then only bills will be cleared by the customs.

b)Regarding mode of payment of customs duties P.W.32 deposed that there are two modes one is by payment of cash and the other is through Duty Exemption Pass Book Scheme i.e., DEPB scripts and at the time of filing Bills of entry in the year 2003 there is a provision for paying duty by way of cash and DEPB in 50:50 ratio.

c)In respect of the DEPBs., in this case P.W.32 deposed that seven

DEPB scripts were received from Kedia Overseas purchased from different parties for filing necessary bills of entry and Exs.P.64 to P.81 to P.85 each containing DEPB scripts, transfer letter, TRA in sealed cover addressed to concerned Assistant Commissioner, DGFT forwarding letter, shipping bill details were received from Kedia

Overseas Limited and as custom agent D.S.Narayana and Company

Pvt. Ltd., handled edible oil consignments and letter addressed to

Deputy Commissioner of Customs House, Kakinada, dated 11.1.2004 in respect of DEPB No.05171454 under Ex.P.81 was signed by him on behalf of D.S.Narayana and Company Pvt. Ltd., and Ex.P.116 are bills of entry Nos.35 dated 24.1.2003, 37 dated 25.1.2003 and 42 dated 28.1.2003 corresponds to Ex.P.65.

d)P.W.32 further deposed that Ex.P.117 Bills of Entry Nos.23 dated 15.1.2003 and 28 dated 17.1.2003 corresponds to ExP.64 and

Ex.P.118 ,Bill of Entry No.20 dated 13.1.2003 corresponds to Ex.P.81 and Ex.P.119 Bill of Entry No.951 dated 27.12.2002 corresponds to

Ex.P.85 and Ex.P.120 Bill of Entry No.943 dated 23.12.2002 corresponds to Ex.P.82 and Ex.P.121 Bill of Entry No.938 dated 19.12.2002 corresponds to Ex.P.83. Exs.P.116 to P.121 Bills of Entries were 104C.C.2/2007/Prl. CBI

Court/VSP prepared by him (P.W.32) and they contain the signatures of B. Kondala

Rao for D.S.Narayana and Company and Raghavendra Rao, the then

Superintendent of Customs. Raghavendra Rao signed in two places in all these bills of entries i.e., in respect of before payment and after payment and all these bills of entries covers the imported item Crude palm oil and Exs.P.116 to P.121 were processed by officials of Customs

House, Kakinada and aftrer processing D.S.Narayana and Company cleared the goods from the warehouses of Importer at Kakinada.

e)In cross examination he deposed that at the time of passing

Exs.P.116 to P.121 no officer objected at any point. He further deposed that the information contained in Exs.P.116 to P.121 were typed by him as authorized person and he received the DEPB licenses by post and they were sent by Importer from Hyderabad and these bills were passed by Customs after thorough verification.

P.W.34/S. Suryanarayana who worked as UDC/Senior Tax

Assistant, Custom House, Kakinada, from June, 2002 to June, 2006 deposed that Exs.P.116 to P.118 contains his initials as Import Clerk and as a mark of process of these X-bond bills of entry and as a mark of process of these X-bond bills of entries he put his initials and these bills along with connected documents were submitted by D.S.Narayana and Company Pvt. Ltd., Custom House Agent, Kakinada, on behalf of

Kedia Overseas Ltd., Hyderabad and he verified DEPBs and TRA

Papers and compared the TRA particulars contained in the sealed cover and bills of entries submitted to the office and check the information furnished by party after comparing with Exs.P.116 to P.118 and he also allotted number to the bill of entry in the Bill of Entry

Register and entered TRA particulars in TRA Incoming Register and 105C.C.2/2007/Prl. CBI

Court/VSP prepared letters to be addressed to the TRA issuing authority about utilization. He further deposed that he placed the file thereafter along with note before the Superintendent by affixing the stamp to avoid double utilization and after processing/assessing by Superintendent and Deputy Commissioner or Assistant Commissioner file was received back to return the bills of entry to the CHA and getting dispatch of letters to the TRA issuing Authorities. He clearly deposed that

Exs.P.64,P.65 and P.81 pertain to the TRAs., submitted by D.S.Narayana and Company Pvt. Ltd., Kakinada and he affixed stamps on them as a mark of utilization.

f)In cross examination he deposed that he verified all those documents as per notification No.45/2002 dated 22.4.2002 and sent letters to Nhava Sheva Port for intimating TRAs., utilization particulars and confirmation but no negative reports were received from them.

g)P.W.35/B.V.V.Satyanarayana Murthy who worked as Tax Assistant

Kakinada from May, 2002 to December, 2002 deposed that his duties as Tax Assistant were processing of Bill of Entries, making entries in relevant registers, preparing miscellaneous reports etc., and Exs.P.119 to P.121 contains initials as Tax Assistant and he assisted, prepared notes and forwarded to Superintendent Raghavendra Rao (L.W.65) and he compared the details mentioned in Exs.P.119 to P.121 with the enclosed documents and also verified value of goods, description of goods, relevant notification, dollar exchange rate and verified the

TRAs., which were received in sealed covers by comparing with TRAs., submitted by D.S. Narayana and Company, Kakinada, on behalf of

Kedia Overseas, Hyderabad, for approval and thereafter compared TRA details with DEPB scripts and after satisfying with the details prepared 106C.C.2/2007/Prl. CBI

Court/VSP note and submitted to L.W.65/M.Raghavendra Rao, the then

Superintendent. He further deposed that from the said Raghavendra

Rao file was sent to Deputy Commissioner/L.W.67/P.Uma Sankar for approval and Exs.P.80 to P.85 TRAs., were received by him in sealed covers from Nhava Sheva Port, Mumbai and he processed these TRAs., by entering them in Inward Register by putting stamp on them for the purpose of identification and DEPB scripts which were enclosed with

Exs.P.82 to P.85 contains his initials.

h)P.W.36/M. Raghavendra Rao who worked as Superintendent,

Central Excise in Appraising Section, Imports, Kakinada from

December, 2000 to June, 2004 deposed that his duty was Assessment of bills of entry of Import cargo and Assessment means verification of chapter headings, rate of duty applicable, exemption notification, if any, calculation of duty, Dollar Exchange rate etc. and Exs.P.116 to

P.121 contains his signatures and they were submitted by D.S.

Narayana and Company Limited on behalf of Kedia Overseas Limited,

Hyderabad and he received all these documents from Dealing

Assistant in the Imports section i.e., P.Ws.34 and 35 along with note and having verified all these documents as per Rules and Notification and after satisfying the information submitted these documents to

Deputy Commissioner/Assistant Commissioner for Final approval and the seven questioned DEPB scripts contain his signatures and stamps and their details were entered in concerned register by his Clerk and all the bills were passed provisionally and they submitted all the details of TRAs., in questioned DEPBs., to Nhava Sheva Port, Mumbai.

i)In cross examination P.Ws.35 & 36 also deposed that no objections were received from Nhava Sheva Port, Mumbai regarding 107C.C.2/2007/Prl. CBI

Court/VSP the questioned T.R.As., and DEPBs., and they were verified as per notification No.45/2002 and all the documents fulfilled the requirements under the said notification.

j)P.W.37/P. Uma Shankar worked as Deputy Commissioner of

Customs, Kakinada and he deposed that Exs.P.115, P.117, P.119 to

P.121 contains signatures and his duty was to monitor revenue collection, process, Bills of entry and shipping bills including

Adminstrataive work etc., and he received all the documents from

P.W.36 and all these bills were assessed and passed.

k)In the cross examination he admits that provisional assessment of the said documents was done as per sec.18 of Customs Act and though they have submitted details of TRAs., to Nhava Sheva Port,

Mumbai, they did not receive any objection from them immediately.

l)As mentioned supra P.W.34 who worked as UDC/Senior Tax

Assistant, Customs House, Kakinada deposed that Exs.P.116 to P.118 contains his initials as Import Clerk and as a mark of process of these bills of entries he made his initials and these bills along with connected documents were submitted by D.S.Narayana & Company Pvt. Ltd.,

Customs House Agent, Kakinada on behalf of Kedia Overseas Limited,.

Hyderabad and he verified Duty Entitlement Pass book (DEPB) and

Telegraphic release Advice paper and compared TRA particulars contains in sealed cover with TRA and DEPB and bils of entry submitted by CHA and furnished to the office and he also allotted numbers to the Bills of Entries in Bill of Entry Register and TRA particulars in TRA Incoming Register and he affixed stamps on

Exs.P.64,P.65 and P.81 as a mark of utilization and he thoroughly checked Exs.P.64, P.65, P.18 and P.116 to P.118.

108C.C.2/2007/Prl. CBI

Court/VSP

30)BOGUS CONCERNS AND FALSE ADDRESSES :

i)A.4 & A.16 AND HIS CONCERNS:

a)In this connection P.W.42 Postman in Beet No.15 which covers

Lalitha Park, Lakshmi Nagar Delhi deposed that there is no firm in the name of M/s.Paramhans Exports (A.16) and M/s.Prerna International (A.4) in D.No.1/37, Lalitha Park, Lakshmi Nagar, Delhi-92.

b)Even P.W.44/Postman for Beat No.15 from 1992 to 2012 deposed that Lalitha Park, Lakshmi Nagar comes under the jurisdiction of Beat

No.15 but during his tenure in that beat he did not notice firms under the name and style of M/s.Paramhans Exports (A.16) and Prerna

International India (A.4) existing in D.No.1/37, Lalitha Park,

Lakshminagar, Delhi-92.

c)Except giving the suggestion that the said firms are very much in existence in that address which was denied by P.Ws.42 and 44 nothing useful to the case of A.4 and A.16 was elicited from P.Ws.42 and 44.

ii)A.1 & HIS CONCERNS:

P.W.26/Laxman Krishna Jadhav Postman in beat No.18, Mumbai, for the period from 2002 to 2004 deposed that Nayak Cottage falls under Beat No.18 and one Vinod Nayak was running Ankush Tours and

Travels in Nayak Cottage, NS Phadke Marg, Andheri East, Mumbai, and

Sanjay Jain (A.1), Sunil Mehta, M/s.Sai International and Global Exports never resided in the said address at any point of time.

iii)A.3 & A.6 AND HIS CONCERNS:

a)P.W.27/Karamvir Singh deposed that in 2002-2003 he gave a room in second floor of his house in New Delhi to Anil Kumar Gupta 109C.C.2/2007/Prl. CBI

Court/VSP (A.3), Surendra Kumar Agarwal (A.6) on rent of Rs.2,500/- and they stayed in that house only for three or four months and they left the house without informing and they stated that they want to open office for the firms of M/s.Lord Empire and S.K. Interworld but they have not kept any board when they were tenants in his house and after leaving the house without information they did not turn up. He strongly denied the suggestion that Anil Kumar Gupta (A.3) and A.6 ran business in his house for two years and paid rent.

b)The aforementioned evidence throws strong suspicion about the very existence of proprietory concerns of A.1, A.3, A.4, A.6 and A.16.

iv)I.Os.

a)P.W.68/U.K.More who is the then Inspector of Police, CBI, EOW,

Mumbai also deposed that he was entrusted with the part of investigation by CBI in respect of tracing some suspects in this case and accordingly he traced them and informed their whereabouts to CBI and he entrusted some part of investigation to another Inspector

D.S.Talekar who collected some documents and recorded statements of witnesses and they were forwarded to CBI, Chennai.

b) P.W.69/D.S.Talekar deposed that as per the instructions of P.W.68 he recorded the statements of L.Ws.52 to 54 and after collecting the documents he handed over them to P.W.68.

c)P.W.70/IO deposed about registration of FIR in this case by the then SP Seema Agarwal under Ex.P.157 against A.1 to A.6 and unknown officials of Customs and unknown others with regard to seven

DEPB license amounting to Rs.1.98 crores and on verification by

Kakinada custom the said fraud came to light.

110C.C.2/2007/Prl. CBI

Court/VSP

d)P.W.71/A.J. Ramalingam who worked during relevant time in CBI,

EOW, Chennai, deposed that on the request of P.W.70/IO he visited

Delhi and examined L.W.16/Arun Kumar Gupta, Proprietor of M/s.

Overseas Traders, Meerut in respect of purchase of two DEPB Licenses and payment of amount.

v)ENCASHMENT OF CHEQUES OF A.1:

a)P.W.65/Hitesh Jain who was proprietor of Sanjay Agencies and carried on cheque discounting business deposed that during that business he maintained Ex.P.111 account in ABN AMRO Bank, Nariman point, Mumbai and A.1 approached him for encashing two cheques worth Rs.2,50,000/- and Rs.4,00,000/- respectively and he deposited those two cheques in Ex.P.111 account and on realization he gave cash by deducting the commission of Rs.650/- and Ex.P.111 statement reflects the said two cheque transactions and Ex.P.112 is Statement of

Account of A.1 in the name of Satyam Impex in ABN AMRO bank which also reflects the said two cheques.

b)P.W.66/Cletus Antony Dsouza who worked as sub-broker under the main broker Action Financial Services India Ltd., deposed that

Ex.P.113 is his account opening form in ABN AMRO Bank and in the month of February, 2003 he requested cashier of ABN AMRO Bank to accept Rs.15 lakhs cash under two or three cheques but he refused their request on the ground that one day prior intimation was necessary for cash deposit and when he approached the Manager and requested him, he also refused and while he was going out by passing through the counter he observed one person requesting the cashier for withdrawing cash against cheque and the cashier told him one day advance intimation was must to withdraw the cash against cheque He 111C.C.2/2007/Prl. CBI

Court/VSP further deposed that on advice of regular customer of the bank problem was solved easily and A.1 gave two cheques signed by him on behalf of Sai International for total amount of Rs.15 lakhs and he satisfied the crediting of the two cheques in his account and gave cash of Rs.15 lakhs to A.1.

31)REGISTERING CASE AGAINST A.2 IN CHANAKYAPURI CRIME

P.S., DELHI:

a)P.Ws.7,8 and 55 were examined in this connection:

b)P.W.8/Naresh Kumar who worked as Sub Inspector, Inter State cell, Crime Branch, Chanakyapuri, New Delhi, from 2005 to 2008 deposed that on receiving secret information on 29.7.2005 about a person Sri Bhagwan Tulsian (A.2) who wanted by Chennai CBI and having reward of Rs.25,000/- against his name likely to come at G-88,

Kalkaji, Delhi. A team was formed by P.W.7 and others and trap was laid and P.W.7 gave Ex.P.66 complaint stating that a car was stopped at G- 88, Kalkaji and informer identified him as Bhagwan Tulsian and on confirmation of his identity he was brought to Crime Branch Office and he was in possession of incriminating documents such as seals of different designations of Customs Officers, letter pads of Senior

Government Officers, Superintendent Central Excise and blank stamp papers, forged filled documents/blank documents etc., and basing on the complaint of P.W.7 he registered Ex.P.67 FIR and A.2 was arrested and even reward amount was also received by the team from Chennai,

CBI and incriminating documents were seized under seizure memos from A.2 under Ex.P.68 by him in the presence of P.W.7 and he also signed in the seizure memos and after completion of investigation charge sheet was filed against A.2 for the offence under sec.468, 473 112C.C.2/2007/Prl. CBI

Court/VSP and 474 in Cr.No.176/2005 before ACMM Court, New Delhi and Ex.P.69 is certified copy of charge sheet.

c)Through P.W.7, who worked as Sub Inspector Inter-state Cell,

Crime Branch, Chankyapuri, New Delhi, certified copy of complaint given by him and FIR filed by him were marked as Exs.P.66 and P.67.

Further Ex.P.68 certified copy of Seizure lists were also marked and they contain forged rubber seals of Government officials as well as different firms impression of rubber stamps, round seal of office of Joint

DGFT, DEPB Licenses, details of export sales made by different firms,

CFSL report, letter heads of office of Superintendent, Central Exchange range, Aligarh, Blank and signed NJ stamp papers etc. were marked.

d)PW.55/Subash Tandon, who worked as Inspector of Police, Inter

State Cell, Crime Branch, Chanakyapuri P.S., New Delhi, deposed that he verified the investigation made by P.W.8 and filed Ex.P.69 charge sheet.

e)The aforementioned testimonies of P.Ws.7,8 and 55 clearly shows the registration of crime under secs.468,473 and 474 against A.2 and even filing of charge sheet in respect of the same and the very documents found in possession of A.2 at the time of his arrest itself shows that he is a suspicious person and carrries many incriminating material for forging and fabricating the documents. FIR in that case is subsequent to the FIR in the instant case.

32)EXPERT EVIDENCE:

a)The next important witness to corroborate the forgery and fabrication is the testimony of P.W.72/CFSL Expert.

113C.C.2/2007/Prl. CBI

Court/VSP

b)Learned Public Prosecutor placed reliance upon State through

SPE and CBI AP Vs. M. Krishna Mohan and another in Judgment

dated 12.10.2007 of Hon'ble Apex Court in Appeal (Crl.) 1394

and 1395 of 2004 wherein the Learned Public Prosecutor placed reliance upon the following observations of the Apex Court in para no.11 of the Judgment:

“When an accused person is called upon by the Court or any other Authority holding an investigation to give his finger impression or signature or a specimen of his handwriting he is not giving any testimony of the nature of a 'personal testimony'.

The giving of a 'personal testimony' must depend upon his volition. He can make any kind of statement or amy refuse to make any statement. But his finger impressions are his handwriting inspite of efforts at concealing the true nature of it by dissimulation cannot change their intrinsic character. Thus the giving of finger impressions are of specimen writing or of signatures by an accused person though it may amount to furnishing evidence in the larger sense is not included within the expression 'to be a witness' .”

c)Ld. Counsel for A.7 to A9 and A12 placed reliance upon the following decisions regarding the value of expert opinion and specimen signatures of accused to be taken in the presence of court or the court itself.

d)In the Deputy Chief Collector of Imports and Exports ,

Hyderabad Vs Boddula Mallesham reported in 1991 (1) ALT

(criminal) 719 AP, the Lordships observed as follows in para 8 of the

Judgment “ From a reading of the above judgment of the Supreme Court ( Sukhvindar Singh Vs State of Punjab”), it is clear that whenever specimen signature is required to be taken from the accused the same shall beobtained in the presence of the court or the court 114C.C.2/2007/Prl. CBI

Court/VSP itself may take such signatures during the trial in terms of section 73 of Evidence Act and byany chance such a specimen signatures were taken by some other authority or court the same cannot be made available to the court trying the case for the purpose of comparison as per Sec.73 of Evidence Act. Hence from the Law declared by the Supreme Court in the above case it is clear that whether accused objected to or not if the specimen signature was not fulfilled either in the presence of court or by the court itself , the same would not be admissible.

e)In Magan Bihari Lal Vs State of Punjab reported in AIR 1977 Supreme Court 1091, in respect of value of expert opinion the

Lordships succintly held as follows:

“it is well settled that expert opinion must always be received with great caution and perhaps none so with more caution than the opinion of a handwriting expert. It is unsafe to base a conviction solely on experts opinion without substantive collaboration.

f)Through P.W.70/IO Exs.P.202 to P.233 were marked. Out of them

Exs.P.202 to P.214 are the specimen signatures and initials of officials and seals. Exs.P.202 and P.204 are specimen signatures of P.H. John,

FTDO and security seal used by him collected in the presence of witnesses respectively. Exs.P.203 and P.205 are specimen signatures of

Smt.S.Pushkaran, FTDO and security seal used by her collected in the presence of witnesses. Ex.P.206 is specimen signatures of K.P. Singh,

FTDO collected in the presence of witnesses. Ex.P.207 is specimen initials of D.K. Jain, Appraiser, Jawahar Customs House, Nhava Sheva, collected in the presence of witnesses. Exs.P.208 and P.209 are specimen signatures and initials of S.B. Arondekar, collected in the presence of witnesses. Exs.P.210 and P.211 are specimen signatures 115C.C.2/2007/Prl. CBI

Court/VSP and specimen intitials of S.R. Sarkar, collected in the presence of witnesses. Exs.P.212 and P.213 are specimen signatures and initials of

B.K. Saxena collected in the presence of witnesses.

g)Ex.P.221 is specimen impression of TRA rubber stamp of Jawahar

Customs House collected in the presence of witnesses. Ex.P.222 is specimen impression of computer entry rubber stamp of Jawahar

Customs House collected in the presence of witnesses. Ex.P.223 is the specimen impression of JNCH, office rubber stamp collected in the presence of witnesses.

h)Turning to the accused signatures, according to P.W.70 Exs.P.214 to P.220 and P.233 are the specimen writings of A.7, Exs.P.224 and

P.225 are specimen signatures of A.2, Ex.P.226 is specimen signatures of Narendra Kumar (A.4), Exs.P.227 and P.230 are specimen signatures and writings of Rajan Gupta (A.16), Exs.P.228, P.231 and P.232 are specimen signatures and writings of Anil Kumar Gupta (A.3) and

Ex.P.229 is specimen signatures of Shivom Kumar (A.15) collected by him personally in the presence of witnesses.

i)Not only these documents, Exs.P.202 to P.233 which includes specimen writings, signatures, initials, stamps and seals were collected by P.w.70 himself in the presence of witnesses according to P.W.70/IO.

j)P.W.72/N. Ravi Expert deposed that questioned documents are in

Exs.P.64, P.65, P.81 to P.85, P.6-A to C, P.1-A to C, P.174, P.17-B, P.16-A,

P.16-B, P.21-A and B, P.20-A and B, P.24-A to F, P.25-A to F, P.26-A to E,

P.29-A to F, P.30-A to P.30-E, P.37, P.38, P.4, P.5, P.11, P.212, P.13, P.39,

P.40 to P.48, P.58 and P.59 and admitted documents marked in A series and admitted documents of A.1 to A.3 are in Exs.P.137, A.4 in Ex.P.145, 116C.C.2/2007/Prl. CBI

Court/VSP

A.5 in Ex.P.146 and A.6 in Ex.P.147. He gave Exs.P.234 and P.235 opinions and his findings are mentioned in pages 4 to 8 of his deposition. He strongly denied the suggestion that only to oblige CBI he gave Exs.P.234 and 235 opinions and they are false.

k)Out of the two opinions Ex.P.234 opinion mentions that specimen signatures of P.H. John marked as S.1 to S.5 could not be connected to the questioned signatures Q.49 to Q.51, the specimen signatures of

Smt. S. Pushkaran marked as S.6 to S.10 could not be connected to her questioned signatures Q.5 to Q.8, the specimen signatures of Sri K.P.

Singh/LW.16 marked as S.21 to S.25 could not be connected to the questioned signatures Q.22,Q.32 to 34, Q.58, Q.68 to 70, Q.75 to 77,

Q.91, Q.101, Q.102, Q.107 to Q.109, the specimen signatures of D.K.

Jain marked as S.26 to S.35 could not be connected to the questioned signatures Q.1, Q.3, Q.17, Q.18, Q.20, Q.30, Q.35, Q.37, Q.47, the specimen signatures of S.B. Arondekar marked as S.36 to S.45 could not be connected to the questioned signatures Q.11, Q.25, Q.42, Q.52,

Q.61, Q.80, Q.94, Q.112, the specimen signatures of B.K. Saxena marked as S.56 to S.65 could not be connected to the questioned signatures Q.10, Q.24, Q.41, Q.60, Q.79, Q.93, Q.111, Q.53, the specimen signatures of S.R. Sarkar marked as S.46 to S.50, S.51 to

S.55 could not be connected to the questioned signatures Q.54, Q.56,

Q.71, Q.73, Q.87, Q.89, Q.103, Q.105, Q.66,Q.85, Q.99, Q.117, the standard initials of N.S.Vankore marked as S.66 to 70 could not be connected to the questioned initials Q.14, Q.28, Q.45,Q.64,

Q.83,Q.97,Q.115, the standard initials of Tarun P. Lulla marked as S.71 to 75 could not be connected to the questioned initials Q.13, Q.27,

Q.44,Q.63, Q.82,Q.96,Q.114.

117C.C.2/2007/Prl. CBI

Court/VSP

l)In Ex.P.235 opinion P.W.72 opined that the specimen signatures marked as S.154 to 158 of A.15 tallies with questioned signatures

Q.133,Q.135,Q.161 to 169, Q.216 to Q.223, the specimen signatures marked as S.129 to 138 of A.2 tallies with questioned signatures

Q.142,Q.145, Q.147 to Q.154, Q.158, Q.160, Q.181, the specimen signatures marked as S.149 to 153, S.164 to 169 of A.3 tallies with questioned signatures Q.156,Q.157,Q.159, Q.170 to Q.172, Q.174 to

Q.160, Q.192, Q.201 to 208 and Q.225 to 238, the specimen signatures marked as S.144 to S.149 and S.159 to 163 of A.16 tallies with questioned signatures Q.139 to 141, Q.143, Q.144, Q.146, Q.211,

Q.214 and Q.215.

m)Hence, as per Ex.P.235 there is positive opinion against A.15,

A.2, A.3 and A.16. The entire bank records wherein the said accused allegedly signed by opening the accounts and by cheque and DD transactions and closing of the accounts, as spoken by prosecution witnesses corroborated by Ex.P.235 opinion. Though it is a fact that much weight cannot be given to the opinion evidence since the said transactions are evidenced by documents and many testimonies of prosecution witnesses. Hence, Ex.P.235 opinion can be safely taken as corroboration.

33)COMPLICITY OF A.10/PRIVATE CUSTOM HOUSE AGENT:

a)According to prosecution he was a private Custsom House Agent doing work at Jawaharlal Nehru Customs House, Nhava Sheva, during the relevant period. Regarding A.10 in the first para of the charge sheet it is generally alleged that, “investigation establish that A.1 to

A.16 have entered into criminal conspiracy during 2002-2003 at Delhi, 118C.C.2/2007/Prl. CBI

Court/VSP

Mumbai, Nhava Sheva, Kakianda etc., to cheat Government of India”.

Further specific allegation is mentioned as follows:

“Sajid Khan (A.9) then arranged fabrication and forgery of the questioned DEPB Licenses and the corresponding TRAs., with the connivance of A.10, A.12, A.11, A.7 etc”

b)Except this specific allegation that A.10 connived with A.9 along with others for arranging fabrication and forgery, nothing is whispered against A.10 in the charge sheet. Even according to the charge sheet

A.9 connived with four persons including A.10 for the alleged fabrication and forgery of DEPB Licenses and corresponding TRAs. It is the duty of the prosecution atleast to explain the role of A.10 in this.

There is absolutely no evidence on record in this connection.

Prosecution is relying upon statements of A.9 under Exs.P.199, P.200 and P.201 given to Customs Officials.

c)Further, in written arguments of prosecution at page 39 it is mentioned that Exs.P.221 to P.223 and P.136 and the testimonies of

P.Ws.6,10,70 and 72/Expert proved that A.10 fabricated all the seven questioned DEPBs., along with A.9, A.12, A.14.

d)A.10 emphatically denied the aforementioned allegations and contend that no specific overt acts are alleged against A.10 and established by prosecution.

e)P.W.6/H.N. Wadetiwar, who worked as Deputy Director General in

DGFT, Mumbai, deposed about Exs.P.62 to P.65 DEPB Licenses and advanced licenses in respect of S.K. Interworld and creative etc. He never whispered about any role of A.10 in this.

119C.C.2/2007/Prl. CBI

Court/VSP

f)Further, P.W.10/Mahesh Kumar Kedia deposed as to the entrustment of the work of purchase of DEPB Licenses in the year 2002 to his younger brother Jitendra Kumar Kedia and Director Damani. He also never whislper about the alleged role of A.10.

g)Hence, P.Ws.6 and 10 did not prove about the alleged role of

A.10 as mentioned in page 39 of written arguments.

h)Exs.P.221 to 223 and P.136 are specimen impressions of TRA rubber stamp of JNCH, Computer Entry rubber stamp of JNCH, specimen impressions of office rubber stamp of JNCH & specimen bulletin stamps of New Custom House, Mumbai respectively. There is no evidence on record to show any alleged over acts of A.10 by himself or along with A.9 or others in fabrication of DEPBs., or TRAs., as alleged by prosecution. Hence, prosecution miserably failed to establish any offence against A.10 and A.10 is liable to be acquitted for the offence under secs120-B, 420,471 of IPC.

34)COMPLICITY OF A.12:

Specific allegation against A.12 in final report is, A.9 arranged fabrication and forgery of questioned DEPBs., and the corresponding

TRAs., with the connivance of A.10, A.11, A.12 and A.7. Except this nothing is alleged against A.12. Except P.W.28 nobody deposed about

A.12. Even P.W.28 deposed only one sentence that A.11, A.12, and A.14 used to come to the room of A.9 where he attended the work. Mere coming to the room of A.9 do not by any stretch of imagination mean that A.12 connived with A.9 in fabricating and forging DEPBs. Hence, basing on that strong sentence A.12 cannot be convicted. There is absolutely no evidence to show nexus between A.12 and fabricating of 120C.C.2/2007/Prl. CBI

Court/VSP

DEPBs. Hence, A.12 is liable to be acquitted for the offences alleged against him.

35)COMPLICITY OF A.14/NITIN KAGINKAR/PRIVATE CUSTOM HOUSE AGENT AT JNCH:

a)In charge sheet first para a general allegation is made that A.1 to

A.16 entered into criminal conspiracy during the year 2002-2003 to cheat Government of India. Specific allegation made against A.14 who is described as private customs agent doing work at JNCH is, “A.9 after arranging forgery and fabrication of documents in connivance with

A.14 stolen TRA registers pertaining to the relevant period on the night of 18.4.2003 with the help and connivance of A.13 Sepoy No.60 who was on security duty in the night of 18.4.2003 to guard PUB and facilitated A.9 and A.14 to enter Custom Room for removal of the relevant TRA registers pertaining to the questioned TRAs., involved in this case from 75correspondence section of license section.”

b)This allegation was emphatically denied by A.14.

c)According to prosecution P.W.28 clearly deposed about the role played by A.14 and A.11 in forging and fabricating DEPB licenses. But a careful scrutiny of the testimony of P.W.28 who deposed about creating data base and filling up the blank printed license forms by typing upon the instructions of A.9 shows that he did not even whisper that A.9 fabricated the DEPB Licenses in connivance with A.14..

d)The mere stray sentence incheif examination of P.W.28 that one

Nithin (A.14), Sandeep Joshi (A.12), Mr. Vedam (A.11) used to accompany A.9 to the room where in he did the typing work of filling licenses many times doesn't ipsofacto mean that they connived with

A.9 in fabricating and forging the licenses without corroboration. None 121C.C.2/2007/Prl. CBI

Court/VSP others even whispered about the name of Nithin (A.14). Hence, there is absolutely no oral evidence on record about the alleged role of A.14 in fabricating and forging the DEPBs and with connivance of A.14, A.9 had stolen TRA registers on the night of 18.4.2003 and prosecution miserably failed to establish the offence alleged against A.14. Hence,

A.14 is liable to be acquitted for the offence under secs.120-B, 420, 471, 201 r/w 34, 411 r/w 34 of IPC and sec.13(1)(d) r/w 13(2) of P.C.

Act, 1988.

e)The aforementioned evidence on record clinchingly shows that the seven questioned licenses are fabricated and forged.

f)Out of seven questioned DEPB licenses Exs.P.82 and P.84 were issued in favour of Shree Sakshi Impex of A.15, Ex.P.83 was issued in favour of Paramhans Exports of A.16, Ex.P.85 was issued in favour of

Paramhans Trading Company of A.3, Ex.P.81 was issued in favour of

Prena Enterprises of A.4. Evidence on record clinchingly shows that questioned licenses are fabricated and not genuine.

g)Ex.P.64 shows that license holder is M/s. Global Exports and the same was transferred to M/s Kedia Overseas Ltd. Ex.P. 64 file further shows the letter of Global exports dated 7.1.2003 addressed to Kedia

Overseas Ltd. Hyderabad confirming the receipt of full and final consideration of Rs. 30,72,681/- under Ex.P.64 DEPB. Ex.P.65 shows that license holder is M/s Sai International of A.1 and it was transferred to Kedia Over Seas Ltd. There is a letter of Sai International in favour of

M/s Keydia Overseas Ltd. Hyderabad dated 17.1.2003 stating that they have received full amount of Rs 27,72,381/- towards consideration for transfer. Ex.P.81 shows that license holder is M/s Prerana International (India) and license was transferred to Kedia Overseas Ltd., it contains a 122C.C.2/2007/Prl. CBI

Court/VSP letter of Prerana International (India) to Kedia Overseas ltd Hyderabad

dated 7.1.2003 stating that full and final consideration of Rs.

25,52,735/- was received towards the consideration for transfer of

DEPB license. Exs.P.82 and P.84 shows that license holder is M/s Sri

Sakshi Impex of A.15 and it was transferred to M/s Kedia Overseas Ltd.,

Hyderabad , this also contains letters of Sri Sakshi Impex to M/s Kedia

Overseas Ltd, Hyderabad confirming the receipt of full and final consideration of Rs. 28,04,107/- under Ex.P.84 and Rs.28,47,442/- under Ex.P.82 towards transfer of licenses. Ex.P.83 shows that license holder is M/s.Paramhans Exports of A.16 and it was transferred to M/s.

Kedia Overseas Ltd., Hyderabad. This contains letter of M/s.Paramhans

Exports to M/s. Kedia Overseas Ltd., confirming the receipt of

Rs.29,26,911/- towards full and final consideration towards transfer of license. Under Ex.P.85, License holder is M/s.Paramhans Trading

Company of A.3. Letter of M/s.Paramhans Trading Company of A.3 enclosed confirming the receipt of Rs.29,08,891/- towards full and final payment from Kedia Overseas Ltd. Hence, by selling Exs.P.64, 65, 81 to 85 DEPBs., which were fabricated huge amounts were received.

h)Coupled with the aforementioned letters of respective proprietary concerns enclosed with the questioned DEPBs with regard to the receipt of substantial amounts from the importer Kedia Overseas

Ltd, Hyderabad there are clear testimonies of respective officers of

Lord Krishna Bank, Noida , Citizen Cooperative Bank Ltd, Noida,UTI

Bank , Begumpet Branch, Hyderabad , SBH, Mehaboobgunj branch,

Hyderabad, Corporation bank, CAPS branch, Hyderabad, Mumbai , about the transactions of payment by Kedia Overseas Ltd, several documents including account opening forms ,cheques and DDs issued by Kedia Overseas Ltd for the purpose of payment of consideration for 123C.C.2/2007/Prl. CBI

Court/VSP transfer of DEPBs in its favour. Further the bank officials who were personally present and seen A1 toA6, A15 and A16 at the time of opening of the accounts , introduction of many of those accounts by

A.2 personally and few accounts on their own introduction were examined by the prosecution. PW. 2 clearly deposed that A.2 told him that the account holders i.e. M/s S.K. Inter world of A.3, A.15 and A.16 are his relatives and Exs.P.2 and P.7 and accounts do not show that M/s

S.K. Inter world neither exported any goods nor received any foreign exchange and Exs.P.18,19, 22 and 23 accounts contains only transactions of import bills. Further evidence on record shows that accounts of these proprietary concerns of A3 toA6 , A15 and A16 were simply opened before the transactions of receiving the amounts from

Kedia Overseas Ltd and closed soon after the transactions and they were given simply IEC Numbers (Importer, Exporter code), though they did not carry on the business of imports and exports. Further PW.72 expert opined that the questioned signatures of A.2 to A.6and A.15 and

A.16 on the respective bank account opening forms DDs, Cheques etc., are tallied with their specimen signatures.

i)If really the proprietary concerns of A.3 to A6 and A15 and A16 are genuine there is absolutely no reason for receiving huge amounts of more than Rs.25 lakhs in each account from Kedia Overseas Ltd without even asking the reason for crediting so much of amounts in their accounts. Not only the credit of amounts in their accounts, they themselves issued cheques and DDs by frequent transfer of one account to another and given letters enclosed to the questioned DEPBs regarding the receipt of full and final amounts for transfer of DEPBs in favour of Kedia Overseas Ltd. This does not arise if these proprietary concerns are totally strangers to the conspiracy and cheating.

124C.C.2/2007/Prl. CBI

Court/VSP

j)Interestingly A.3 to A.6 , A.15 and A.16 did not even make any endeavor to adduce any evidence to show that they have nothing to do with the conspiracy and cheating in this case and they have not opened the accounts as alleged by the bank officials and their signatures in the documents do not belong to them. Further the only suggestions given to many bank officers who were examined in this case is bank did not follow KYC norms or RBI guidelines and the said bank officers are not competent to speak. In page 8 of written arguments of A3 to A6 , A15 and A16, it is mentioned that accounts opened by these accused were infact introduced by A2 and he operated the same. But no such suggestion was given to any of the bank officers though more than 10 bank officers were examined.

k)Further in the case on hand A.2 died on 5.2.17 according to the death certificate filed by prosecution and case agaisnt him was abated on 12.9.17 and Pws 1 to 61 were examined by the date of 5.2.17 i.e.

death of A.2. Though the present counsel for A3 to A6 , A10, A14 toA16 is also the counsel for A2 and cross examined almost all bank officials even before the death of A2 no such suggestion of opening nominal accounts and A.2 alone operated the accounts without their knowledge and consent and A.3 to A6 , A15 and A16 have nothing to do with the huge amounts credited into their accounts was given.

l)The aforementioned unimpeachable evidence on record clearly shows that without any criminal conspiracy with A2 for the purpose of cheating Government of India and to cause loss to the customs officials, A3 to A6, A15 and A16 ought not to have done all the afore mentioned acts facilitating and aiding A.2 in these transactions of receiving the money from Kedia Overseas Ltd and selling the DEPBs for huge consideration knowing that they are fabricated.

125C.C.2/2007/Prl. CBI

Court/VSP

36)CONCLUSION:

a)Viewed in any angle the aforementioned cogent, tangible, concrete and succinct evidence adduced by prosecution clearly demonstrates criminal conspiracy amongst A.2 to A.6, A.15 and A.16 to cheat Government of India and thereby cheated customs officials

Kakinada and caused loss of Rs.1,98,78,418/- and corresponding gain to them.

b) Hence prosecution has established the offence under sec.120-B and 420 of IPC beyond reasonable doubt against A.3 to A.6, A.15 and

A16. I answer point 2 and 3 accordingly.

13.POINTS No.4 & 5:

Since points no. 4 and 5 (Charge Nos. 3 and 4) U/sec.467 ad 468 of IPC is only against A.2 and case against A.2 is abated the charges became redundant and no need to answer.

14.POINT No. 6:

Prosecution failed to prove any charge against A.7 to A.10, A.12 to A.14.

As discussed in points 2 and 3 since A.3 to A.6 and A.15 and A.16 did not pesonally use as genuine these questioned 7 DEPB licenses , sec. 471 of IPC do not attract. Hence prosecution failed to establish the offence under sec.471 of IPC against A.3, A.4, A.7, A.8, A.9, A.10, A.12 to A.16. Hence, they are liable to be acquitted.

15.POINT No.7:

For the reasons mentioned in Points No.2 and 3, prosecution miserably failed to establish the offence under sec.201 r/w 34 of IPC against A.8, A.9, A.13 and A.14. Hence, they are liable to be acquitted for the charge under the said section.

16.POINT NO. 8:

126C.C.2/2007/Prl. CBI

Court/VSP

For the reasons mentioned in Points No.2 and 3, prosecution miserably failed to establish the offence under sec.411 r/w 34 of IPC against A.8, A.9, A.13 and A.14. Hence, they are liable to be acquitted for the charge under the said section.

17.POINT NO. 9:

For the reasons mentioned in Points No.2 and 3, prosecution miserably failed to prove the offence against A.8, A9, A13 and A.14 under Secs. 13(1)(d) r/w 13(2) of PC Act. Hence they are liable to be acquitted under the said sections.

18.In the result, Accused Nos.3 to 6, 15 and 16 are found guilty for the offence under secs.120-B and 420 of IPC and accordingly, they are convicted for the said offence under sec.248(2) Cr.P.C

Further, Accused Nos.3,4,7 to 10, 12 to 16 are found not guilty for the offence under sec.471 of IPC and they are acquitted for the said offence under sec.248(1) Cr.P.C.

Further, Accused Nos.8,9,13 and 14 are found not guilty for the offence under sec.201 r/w 34 of IPC and they are acquitted for the said offence under sec.248(1) Cr.P.C.

Further, Accused Nos.8,9,13 and 14 are found not guilty for the offence under sec.411 r/w 34 of IPC and they are acquitted for the said offence under sec.248(1) Cr.P.C.

Further, Accused Nos.8,9,13 and 14 are found not guilty for the offence under sec. 13(1)(d) r/w 13(2) of P.C. Act, 1988 and they are acquitted for the said offence under sec.248(1) Cr.P.C.

Typed to my dictation, corrected and pronounced by me in open Court on this the day 31st day of February, 2018.

127C.C.2/2007/Prl. CBI

Court/VSP

Sd/- A. Gayathri Devi,

PRL. SPL. JUDGE FOR C.B.I. CASES,

VISAKHAPATNAM.

19.A.3, A.4, A.5, A.6, A.15 & A.16 are questioned with regard to quantum of sentence that may be imposed against them for which they submitted as follows:

A.3 states that he is poor and aged 66 and dependant upon his son Rajan Gupta (A.16) and suffering from multiple diseases and underwent spine surgery recently and pleads mercy.

A.4 states that he is a daily wage workers and his financial condition is bad and his three children are dependants upon him and pleads mercy.

A.5 states that he is poor and working as security guard and got 9 years son and handicapped brother is dependant upon him and suffering from ill health and pleads mercy.

A.6 states that he is working as accountant and poor and his parents and children are dependants upon him and he is suffering from ill health and pleads mercy.

A.15 states that he is poor and working as daily wage coolie and he got children aged 12 years, 9 years and 6 months and all are dependants upon him and pleads mercy.

A.16 states that he is running medical shop in a rented accommodation and his parents, wife and son are dependants upon him and he is the only bread winner in the family and pleads mercy.

20.Taking into consideration of facts and circumstances of the case, gravity of the offence, social impact of the crime and plea submitted 128C.C.2/2007/Prl. CBI

Court/VSP by accused with regard to quantum of sentence, this Court feels that it is not a fit case to take lenient view.

21.In the result, A.3,A.4, A.5, A.6, A.15 and A.16 are sentenced to undergo Rigorous imprisonment for a period of three years each and to pay fine of Rs.2,000/- each (Rupees two thousand only), in default of payment of fine, to undergo simple imprisonment for a period of one month each for the offence punishable under sec.120-B of IPC.

A.3,A.4, A.5, A.6, A.15 and A.16 are further sentenced to undergo Rigorous imprisonment for a period of three years each and to pay fine of Rs.2,000/- each (Rupees two thousand only), in default of payment of fine, to undergo simple imprisonment for a period of one month each for the offence punishable under sec.420 of

IPC.

Total fine comes to Rs.24,000/- (Rupees twenty four thousand only).

The substantive sentence of imprisonment awarded to A.3, A.4,

A.5, A.6, A.15 and A.16 for two counts above shall run concurrently.

The period of detention, if any, undergone by A.3, A.4, A.5,

A.6, A.15 and A.16 shall be set off under sec.428 Cr.P.C.

A.7, A.8, A.9, A.10, A.12, A.13 and A.14 are directed to execute a bond of Rs.30,000/- each (Rupees thirty thousand only) undertaking to appear before the Hon’ble High Court in terms of

Sec.437-A Cr.P.C.

A.3, A.4, A.5, A.6, A.15 and A.16 are informed about their right to prefer an appeal against the judgment of this Court and they 129C.C.2/2007/Prl. CBI

Court/VSP are entitled to avail legal aid for preferring the appeal against the judgment of this Court, if they have no means.

Free copy of the calendar and judgment shall be furnished to

A.3, A.4, A.5, A.6, A.15 and A.16 forthwith.

Typed to my dictation, corrected and pronounced by me in open Court on this the day 28th day of February, 2018.

Sd/- A. Gayathri Devi,

PRL. SPL. JUDGE FOR C.B.I. CASES,

VISAKHAPATNAM.

APPENDIX OF EVIDENCE

LIST OF WITNESSES EXAMINED ON BEHALF OF PROSECUTION.

P.W.1/15.07.15: S.S. Vaidya P.W.2/15.07.15: Ajay. B P.W.3/17.07.15: Shankar P. Padhy P.W.4/17.07.15: Vineet Agrawal P.W.5/20.07.15: Smt.M. Sujatha P.W.6/20.07.15: H.N. Wadetiwar P.W.7/21.07.15: Manjeet Tomer P.W.8/21.07.15: Naresh Kumar P.W.9/24.07.15: C. Balraj P.W.10/27.07.15: Mahesh Kumar Kedia P.W.11/28.07.15: Vora Shailesh Kumar P.W.12/28.07.15: Tarachand Chhajed P.W.13/07.12.15: Narendra Godbole P.W.14/07.12.15: M.K. Kaushal P.W.15/08.12.15: M.G. Damini P.W.16/10.12.15: Nagesh Aspat P.W.17/10.12.15: B. Philip Pereira P.W.18/10.12.15: P.S. Salian P.W.19/11.12.15: S.P. Parui P.W.20/11.12.15: G.K. Sahoo P.W.21/11.12.15: S.S.Ambegaokar P.W.22/11.12.15: Smt. Archana Kulakarni P.W.23/11.12.15: Prabha Shaikh P.W.24/11.12.15: Smt. Sandhya Dighe P.W.25/15.12.15: S.G. Mendonca P.W.26/15.12.15: Laxman Krishna Jadhav P.W.27/15.12.15: Karambir Singh P.W.28/15.12.15: Dilip Ganapat Dalvi P.W.29/16.12.15: T. Ranga Rao P.W.30/16.12.15: Dinesh Gokhale P.W.31/16.12.15: Rajeev Raghavan P.W.32/16.12.15: Yedida Sathiraju P.W.33/16.12.15: Y.V. Satyanarayana P.W.34/04.04.16: S. Suryanarayana P.W.35/06.04.16: B.V.V. Satyanarayana Murthy P.W.36/06.04.16: M. Raghavendra Rao P.W.37/06.04.16: P. Uma Shankar 130C.C.2/2007/Prl. CBI

Court/VSP

P.W.38/11.04.16: P.K. Iyer P.W.39/13.04.16: Sunil Angane P.W.40/13.04.16: Santosh Dattu Jhadhav P.W.41/18.04.16: N. Dharamsey P.W.42/27.09.16: Ramavatar P.W.43/27.09.16: Arun Gupta P.W.44/28.09.16: Rakesh Kumar P.W.45/28.09.16: M.A. Andrade P.W.46/29.09.16: R.R. Borkar P.W.47/30.09.16: Tarun P. Lulla P.W.48/30.09.16: D.K. Jain P.W.49/27.10.16: P.K. Santra P.W.50/28.10.16: Vijayakumar Srivatsav P.W.51/28.10.16: Jagadishwar V. Hirenath P.W.52/28.11.16: Peeyush K. Pandey P.W.53/28.11.16: Deepak Doke P.W.54/29.11.16: Atanu Choudhary P.W.55/30.11.16: Subash Tandon P.W.56/30.11.16: Sandipan Majumdar P.W.57/01.12.16: P. Rajendran P.W.58/01.12.16: Ram Kumar P.W.59/01.12.16: Anant Shayan P.W.60/02.12.16: R.D. Moree P.W.61/02.12.16: N.S. Vanakore P.W.62/08.03.17: M.V. Ramakrishna Rao P.W.63/09.03.17: Atul Kumar Sharma P.W.64/10.03.17: Mahendra Pal P.W.65/10.03.17: Hitesh Jain P.W.66/10.03.17: Cletus Anthony Disouza P.W.67/09.05.17: Yogesh Sancheti P.W.68/08.06.17: U.K.More P.W.69/09.06.17: D.S.Talekar P.W.70/31.07.17: T. Murugesan P.W.71/07.08.17: A.J. Ramalingam P.W.72/22.08.17: N. Ravi (Addl. Witness)

LIST OF DOCUMENTS MARKED ON BEHALF OF PROSECUTION.

Ex.P.1: Entire file of M/s Paramhans Exports (A.2) Ex.P.1-A: Account opening form of M/s Paramhans Exports dated 30.3.2002 (A.2) Ex.P.1-B: Declaration for sole Proprietorship firm Ex.P.1-C: Letter dated 03.05.2003 Ex.P.2: Statement of Account From 30.3.2002 to 05.05.03 Ex.P.3: Demand Draft bearing No. 18915, dt. 20.12.2002 for Rs.28,37,658/- in favour of M/s. Paramahans Exports payable at New Delhi Ex.P.4: Cheque bearing No.3996 dt.26.12.2002 Ex.P.5: Cheque bearing No.3998 dt.27.12.2002 for Rs.18,00,000/- Ex.P.6: Entire file of M/s. Shree Sakshi Impex along with enclosures Ex.P.6-A: Account opening form in the name of M/s Shree Sakshi Impex,

dated 25.6.2002

Ex.P.6-B: Declaration for sole Proprietorship firm Ex.P.6-C: Request letter dt. 3.5.2003 of proprietor Shree Sakshi Impex Ex.P.7: Certified true copy of statement of account of Current A/c No. 1891 of M/s Shree Sakshi Impex for the period from 25.6.2002 to 5.5.2003 Ex.P.8: Demand draft bearing No. 704233, dt. 27.12.2002 for Rs.9,00,000/- in favour of M/s. Shree Sakshi Impex payable at New Delhi 131C.C.2/2007/Prl. CBI

Court/VSP

Ex.P.9: Demand Draft bearing NO. 704234, dt. 27.12.2002 for Rs.9,00,000/- in favour of M/s. Shree Sakshi Impex payable at New Delhi Ex.P.10: Demand draft bearing NO. 704235, dt. 27.12.2002 for Rs.8,71,395/- in favour of M/s. Shree Sakshi Impex payable at New Delhi Ex.P.11: Cheque bearing No. 004943, dt. 01.01.2003 for Rs.11,50,000/- issued by Proprietor of Shree Sakshi Impex in favour of Lord Empire International Ex.P.12: Cheque bearing No. 004945, dt. 20.02.2003 for Rs.25,000/- issued by Proprietor of Shree Sakshi Impex in favour of A.3 Ex.P.13: Cheque bearing No. 004940, dt. 20.02.2003 for Rs.15,00,000/- issued by Proprietor of Shree Sakshi Impex in favour of self Ex.P.14: Deposit slip dt. 24.12.2002 in favour of M/s Paramahans Exports for depositing Rs.28,37,658/- Ex.P.15: Entire file of M/s Lord Empire International along with its enclosures Ex.P.15-A: Account opening form in the name of M/s Lord Empire International, dated 31.5.2002 Ex.P.15-B: Declaration for sole Proprietorship firm Ex.P.16: Entire file of M/s Lakshmi Enterprises dated 5.8.2002 Ex.P.16-A: Account opening form in the name of M/s Lakshmi Enterprises

dated 5.8.2002

Ex.P.16-B: Declaration for sole proprietorship firm Ex.P.17: Entire file of M/s Ganesh Overseas INC., dated 27.10.2001 Ex.P.17-A: Account opening form in the name of M/s Ganesh Overseas INC, dated 27.10.2001 Ex.P.17-B: Declaration for sole Proprietorship firm Ex.P.18: Computerized copy of statement of account of M/s Lakshmi Enterprises Ex.P.19: Computerized copy of statement of account of M/s Lord Empire International. Ex.P.20: Entire file containing account opening form in the name of M/s S.K.Interworld Ex.P.20-A: Account opening form in the name of M/s S.K.Interworld, dated 6.8.2002 Ex.P.20-B: Declaration for sole Proprietorship firm Ex.P.21: Entire file of M/s Creative along with its enclosures Ex.P.21-A: Account opening form in the name of M/s Creative dt.8.3.2002 Ex.P.21-B: Declaration for sole Proprietorship firm Ex.P.22: Computerized copy of statement of account of M/s S.K.Interworld Ex.P.23: Computerized copy of statement of account of M/s Creative Ex.P.24: Entire file of M/s Sakshi Impex along than t Ex.P.24-A: Account opening form for account No. 2250-01 in the name of M/s Sakshi Impex Ex.P.24-B: Photostat copy of the PAN Card attested by the account holder Ex.P.24-C: Affidavit given by the account holder for opening current account Ex.P.24-D: Letter dated 12.6.2002 was sent by officer of Citizen Co- operative bank Ltd., to M/s Shree Sakshi Impex Ex.P.24-E: Letter dated 5.5.2003 sent by Shivom Kumar (A-15) as Proprietor of Shree Sakshi Impex to the Branch Manager, Citizen Co-operative Bank Ltd., Noida for closure of the account Ex.P.24-F: Photostat copy of Telephone bill for No. 7113865 in the name of Agarwal Narender Kumar attested by proprietor of Shree Sakshi impex Ex.P.25: Entire File of M/s Paramahans Trading Company along with enclosures 132C.C.2/2007/Prl. CBI

Court/VSP

Ex.P.25-A: Account opening form for account No. 1721-01 in the name of M/s Paramahans Trading Company Ex.P.25-B: Photostat copy of the PAN Card attested by the account holder Ex.P.25-C: Notarized Affidavit given by the account holder for opening current account Ex.P.25-D: Letter dated 3.01.2002 sent by officer of Citizen Co-operative bank Ltd., to M/s. Paramahans Trading Company Ex.P.25-E: Letter dated 10.6.2002 to the Manager Citizen Co-operative Bank Ltd., about the change of address Ex.P.25-F: Letter dated 5.5.2003 sent by Anil Kumar Gupta A-3 as Proprietor of M/s. Paramahans Trading Company to the Branch Manager, Citizen Co-operative Bank Ltd., Noida for closer of the account Ex.P.26: Entire file of M/s. Ganesh Overseas INC and its enclosures Ex.P.26-A: Account opening form for account No. 1786-01 in the name of M/s Ganesh Overseas INC Ex.P.26-B: Photostat copy of the PAN Card Ex.P.26-C: Notarized Affidavit given by the account holder for opening current account Ex.P.26-D: Letter dated 26.9.2001 was sent by officer of Citizen Co- operative bank Ltd., to M/s. Ganesh Overseas Ex.P.26-E: Letter dated 8.5.2003 sent by of A.3 as Proprietor of M/s Ganesh Overseas to the Branch Manager, Citizen Co- operative Bank Ltd., Noida for closer of the account Ex.P.27: Entire file of M/s Laxmi Enterprises and its enclosures Ex.P.27-A: Account opening form for account No. 1478-01 in the name of M/s .Laxmi Enterprises and its enclosures Ex.P.27-B: Photostat copy of the PAN Card Ex.P.27-C: Notarized Affidavit given by the account holder for opening current account Ex.P.27-D: Letter dated 12.10.2001 was sent by officer of Citizen Co- operative bank Ltd., to M/s Laxmi Enterprises Ex.P.28: Entire file of M/s Lord Empire International and its enclosures Ex.P.28-A: Account opening form for account No. 2280-01 in the name of M/s . Lord Empire International Ex.P.28-B: Photostat copy of Income Tax PAN Card letter Ex.P.28-C: Notarized Affidavit given by the account holder for opening current account Ex.P.28-D: Letter dated 29.6.2002 was sent by officer of Citizen Co- operative bank Ltd., to M/s Lord Empire International Ex.P.29: Entire file of M/s Mahalaxmi Handicrafts and its enclosures Ex.P.29-A: Account opening form for account No. 2295-01 in the name of M/s . Mahalaxmi Handicrafts Ex.P.29-B: Photostat copy of the PAN letter Ex.P.29-C: Notarized Affidavit given by the account holder for opening current account Ex.P.29-D: Photostat copy of self attested Ration Card of Narender Kumar Agarwal Ex.P.29-E: Letter dated 01.07.2002 was sent by officer of Citizen Co- operative bank Ltd., to M/s Mahalaxmi Handicrafts Ex.P.30: Entire file of M/s S.K.Interworld and its enclosures Ex.P.30-A: Account opening form for account No. 2294-01 in the name of M/s S.K.Interworld Ex.P.30-B: Photostat copy of the PAN letter Ex.P.30-C: Notarized Affidavit given by the account holder for opening current account Ex.P.30-D: Letter dated 1.07.2002 was sent by officer of Citizen Co- operative bank Ltd., to M/s S.K.Interworld 133C.C.2/2007/Prl. CBI

Court/VSP

Ex.P.30-E: Letter dated 7.5.2003 sent by A-3 as Proprietor of M/s S.K.Interworld to the Branch Manager, Citizen Co-operative Bank Ltd., Noida for closer of the account Ex.P.31: Statement of account for the account number 225001 in the name of Shree Sakshi Impex for the period from 1.11.02 to 30.5.03 Ex.P.32: Statement of account for the account number 1721-01 in the name of Parmahans Trading Company for the period from 1.11.02 to 30.5.03 Ex.P.33: Statement of account for the account number 1478-01 in the name of M/s Laxmi Enterprises for the period from 1.11.02 to 30.5.03 Ex.P.34: Statement of account for the account number 2280-01 in the name of M/s Lord Empire International for the period from 1.11.02 to 30.5.03 Ex.P.35: Statement of account for the account number 2294-01 in the name of M/s S.K.Interworld for the period from 1.11.02 to 30.5.03 Ex.P.36: Statement of account for the account number 2295-01 in the name of M/s Mahalaxmi Handicrafts for the period from 1.11.02 to 30.5.03 Ex.P.37: Original credit slip dated 2.1.2003 for Rs.26,41,061/- in respect of Shree Sakshi Impex Ex.P.38: Credit slip contains deposit of 3 instruments (Cheque/DD) of Corporation Bank Ex.P.39: Cheque bearing No.313971 dt. 31.12.2002 issued by Proprietor Shree Sakshi Impex in favour of S.K.Interworld for Rs. 4,95,000/-. Ex.P.40: Cheque bearing NO. 313972 dt. 31.12.2002 issued by Proprietor Shree Sakshi Impex in favour of Mahalaxmi Handicrafts for Rs.4,65,000/- Ex.P.41: Cheque bearing No. 313968 dt. 31.12.2002 issued by Proprietor Shree Sakshi Impex in favour of Laxmi Enterprises for Rs. 7,50,000/- Ex.P.42: Cheque bearing No. 313970 dt. 2.1.2003 issued by Proprietor Shree Sakshi Impex in favour of Pramahans Trading Company for Rs. 4,35,000/- Ex.P.43: Cheque bearing No. 313969 dt. 2.1.2003 issued by Proprietor Shree Sakshi Impex in favour of A.3 for Rs. 4,85,000/- Ex.P.44: Cheque bearing No. 234900 dt. 1.1.2003 issued by Proprietor Pramahans Trading Company in favour of Laxmi Enterprises for Rs. 9,95,000/- Ex.P.45: Cheque bearing No. 234899 dt. 1.1.2003 issued by Proprietor Pramahans Trading Company in favour of Lord Empire International for Rs. 5,00,000/- Ex.P.46: Cheque bearing No. 234894 dt. 1.1.2003 issued by Proprietor Pramahans Trading Company in favour of Mahalaxmi Handicrafts for Rs. 5,00,000/- Ex.P.47: Cheque bearing No. 234895 dt. 1.1.2003 issued by Proprietor Pramahans Trading Company in favour of self for Rs. 5,00,000/- Ex.P.48: Cheque bearing No. 234896 dt. 1.1.2003 issued by Proprietor Pramahans Trading Company in favour of A.3 for Rs. 4,35,000/- Ex.P.49: Cheque bearing No.386212 dt. 31.12.2002 issued by Proprietor S.K.Inter world in favour of Raju Singh for Rs. 4,95,000/- Ex.P.50: Cheque bearing No.386268 dt. 31.12.2002 issued by Proprietor Mahalaxmi Handicrafts in favour of Raju Singh for Rs. 4,65,000/- Ex.P.51: Cheque bearing No.394754 dt. 31.12.2002 issued by Proprietor Laxmi Enterprises in favour of Shiv om Kumar for Rs. 3,30,000/- Ex.P.52: Cheque bearing No.394751 dt. 3.1.2003 issued by Proprietor Laxmi Enterprises in favour of S.K.Singh for Rs. 3,00,000/- 134C.C.2/2007/Prl. CBI

Court/VSP

Ex.P.53: Cheque bearing No.394752 dt. 1.1.2003 issued by Proprietor Laxmi Enterprises in favour of self for Rs. 5,00,000/- Ex.P.54: Cheque bearing No.389435 dt. 31.12.2002 issued by Proprietor Laxmi Enterprises in favour of Suvidhi International Pvt. Ltd., for Rs. 5,00,000/- Ex.P.55: Cheque bearing No.386331 dt. 1.1.2003 issued by Lord Empire International in favour of self for Rs. 5,00,000/- Ex.P.56: Cheque bearing No.386264 dt. 1.1.2003 issued by Mahalaxmi Handicrafts in favour of self for Rs. 5,00,000/- Ex.P.57: Cheque bearing No. 232325 dt. 3.1.2003 issued by Laxmi Enterprises in favour of Suvidhi International Pvt. Ltd., for Rs. 5,00,000/- Ex.P.58: Cheque bearing No.397401 dt. 4.1.2003 issued by Pramahans Trading Company in favour of Laxmi Enterprises for Rs. 3,00,000/- Ex.P.59: Cheque bearing No. 397402 dt. 20.1.2003 issued by Pramahans Trading Company in favour of Lord Empire International for Rs. 3,00,000/- Ex.P.60: Statement of Account of M/s.Kedia Overseas Ltd., A/c.No.008010200019585 dated 26.2.2003 Ex.P.61: Cheque bearing No.654692 dt.19.2.2003 issued by authorized signatory of Kedia Overseas Ltd., in favour of Sai International Mumbai for Rs.25,50,590/- Ex.P.62: Original advance license file maintained in our office pertaining to S.K.Interworld, New Delhi (35 sheets) Ex.P.62-A: Original record copy of advance license number 0310169974/4/03/00 issued in the name of S.K.Interworld Ex.P.63: Original advance license file maintained in their office pertaining to Creative, New Delhi (32 sheets) Ex.P.63-A: Original office record copy of advance license number 0310165690/4/03/00 issued in the name of Creative in Ex.P.63 Ex.P.64: Bunch of papers showing DEBP license purportedly issued in the name of M/s Global Exports Mumbai, TRA issued in favour of M/s Kedia Overseas Ltd., Hyderabad etc., Ex.P.64-A: Original DEBP license No. 0310165690/5/06/00 dated 1.11.2002 in Ex.P.64 purportedly issued in the name of Global Exports Ex.P.65: Bunch of papers showing DEBP license purportedly issued in the name of M/s Sai International Mumbai, TRA issued in favour of M/s Kedia Overseas Ltd., Hyderabad etc. Ex.P.65-A: Original DEBP license No. 0310169974/5/06/00 dated 2.12.2002 in Ex.P.65 purportedly issued in the name of Sai International. Ex.P.66: Certified copy of said complaint statement dated 29.7.2005 given by P.W.7 in Hindi Ex.P.67: Certified copy of FIR registered by Sub Inspector Naresh Kumar on 29.7.2005 against Bhagwan Tulasian, in Hindi Ex.P.68: Certified copy of seizure list along with enclosures Ex.P.69: Certified copy of charge sheet filed by Sri Naresh Kumar, Sub Inspector (L.W.11) in Cr.No.176/05 of Chanakyapuri Police station under sec.468,473, 474 IPC Ex.P.70: Attested computer printout of Statement of current account bearing No.01600050199 pertaining to Kedia Overseas Limited for the period from 20.12.2002 to 15.1.2003 (six sheets) Ex.P.71: Cheque bearing No.516876 dated 25.12.2002 for Rs.27,93,946/- issued by Kedia Overseas Limited for issuing Demand Draft in favour of M/s.Paramhans Trading Company Ex.P.72: Demand Draft application dated 25.12.2002 for obtaining D.D., in favour of Paramhans Trading Company 135C.C.2/2007/Prl. CBI

Court/VSP

Ex.P.73: Demand draft bearing No.189355 issued in favour of Paramhans Trading Company on 26.12.2002 for Rs.27,91,155/- by Bank Ex.P.74: Cheque bearing No.516855 dated 20.12.2002 for Rs.28,40,496/- issued by Kedia Overseas Limited for issuing Demand Draft in favour of M/s.Paramhans Exports Ex.P.75: Demand draft application dated 20.12.2002 for obtaining D.D., in favour of Paramhans Exports Ex.P.76: Cheque bearing No.516944 dated 13.01.2003 for Rs.87,979/- issued by Kedia Overseas Limited for issuing Demand Draft in favour of M/s.Satyam Impex Ex.P.77: Demand draft application dated 13.01.2003 for obtaining D.D., in favour of Paramhans Exports Ex.P.78: Demand draft bearing No.190116 issued in favour of Satyam Impex on 15.01.2003 for Rs.87,891/- by Bank Ex.P.79: Cheque bearing No.516873 dated 25.12.2002 issued by Kedia Overseas Limited, for Rs.54,53,745/- in favour of Corporation Bank (Overseas Trader) Ex.P.80: Cheque bearing No.516943 dated 13.01.2003 issued by Kedia Overseas Limited, for Rs.52,00,000/- in favour of Corporation Bank (Satyam Impex). Ex.P.81: Covering letter dated 11.1.2003 along with bunch of papers containing DEPB license issued in the name of Prerna International (India) Delhi and release advice No.S/32-JNP/KKD Seaport/439/DEPB/2002 LIC. Ex.P.82: Original Release advice No.S-32-JNP/Kakinada Sea Port 17662/DEPB/2002 LIC by Jawahar Customs House, Nhavaseva along with enclosures Ex.P.83: Original Release advice No.S-32-JNP/Kakinada Sea Port 17660/DEPB/2002 LIC along with enclosures Ex.P.84: Original Release advice No.S-32-JNP/Kakinada Sea Port 17663/DEPB/2002 LIC along with enclosures Ex.P.85: Original Release advice No.S-32-JNP/Kakinada Sea Port 17661/DEPB/2002 LIC along with enclosures Ex.P.86: Pay Order No.059513 dt.15.1.03 of Corporation Bank Ex.P.87: Account opening form and its enclosures in the name of Sai International for account number 800843 of ABN Amro bank by Sri Sanjay P.Jain(A-1) Ex.P.88: Extract of relevant pages of Dispatch register of the licenses Ex.P.89: Edit report of M/s. Paramhans Exports Ex.P.90: Edit report of M/s. Sree Sakshi Inpex Ex.P.91: Edit report of M/s. Prerna International (India) Ex.P.92: Edit report of M/s. Lord Empire International Ex.P.93: Edit report of M/s. Mahalaxmi Handicarfts Ex.P.94: Edit report of M/s. Laxmi Enterprises Ex.P.95: Importer Exporter Code issued in favour of M/s S.K.Inter world, New Delhi Ex.P.96: Importer Exporter Code issued in favour of M/s Paramhans Trading Company Ex.P.97: Edit report of M/s. Creative , New Delhi Ex.P.98: Attested Xerox copy of Panchanama dt.2.7.03 Ex.P.99: original diary seized during the search which contains phone numbers of different persons Ex.P.100: Attested copy of panchanama dt.10.7.03 (42 pages) Ex.P.101: One file containing 57 sheets seized under Ex.P.98 Ex.P.102: Certified photo copies of Statements 2.7.03 under sec.108 of Customs Act of A.8 Ex.P.103: Certified photo copies of statements dt.11.7.03 and 6.8.03 of A.13 Ex.P.104: Certified photo copies of statement dt.14.7.03 of A.7 136C.C.2/2007/Prl. CBI

Court/VSP

Ex.P.105: Certified photo copies of statements dt.3.7.03, 9.7.03 and 15.7.13 of A.9 Ex.P.106: Attested photo copy of statement dt.2.7.03 recorded under sec.108 of the Customs Act Ex.P.107: Attested photo copy of panchanama dt.3.7.03 Ex.P.108: Remit message to Corporation bank, Hyderabad, dt.26.12.02 favouring M/s. Overseas Traders Ex.P.109: Remit message of Corporation Bank, Hyderabad, dt.15.01.03 favouring M/s.Satyam Impex Ex.P.110: Account opening form of A/c.No.785713 along with statement of Balaji Corporation Ex.P.111: Account opening form of A/c.No.786478 along with statement of Sanjay Agencies of ABN AMRO Bank, Mumbai Ex.P.112: Statement of A/c.No.791815 of Satyam Impex at ABN AMRO Bank, Mumbai Ex.P.113: Account opening form of A/c.No.755158 along with statement of Cletus Anthony Dsouza Ex.P.114: Account opening form of A/c.No.763174 along with Statement of from 1.10.02 to 4.3.04 Ex.P.115: Statement of account No.800843 of M/s.Sai International Mumbai along with Seven cheques of ABN AMRO Bank, Mumbai. Ex.P.116: Bill of Entry No.35,37 and 42 filed by M/s.Kedia Overseas Ltd., Hyderabad (3 sheets) Ex.P.117: Bill of Entry No.23,28 filed by M/s. Kedia Overseas Ltd., Hyderabad Bill of Entry No.35,37 and 42 filed by M/s.Kedia Overseas Ltd., Hyderabad (3 sheets) Ex.P.118: Bill of Entry No.20 dt.13.1.03 filed by M/s. Kedia Overseas Ltd., Hyderabad (1 sheet) Ex.P.119: Bill of Entry No.23 dt.15.1.03 filed by M/s. Kedia Overseas Ltd., Hyderabad (1 sheet) Ex.P.120: Bill of Entry No.943 dt.15.1.03 filed by M/s. Kedia Overseas Ltd., Hyderabad (1 sheet) Ex.P.121: Bill of Entry No.938 dt.19.12.02 filed by M/s. Kedia Overseas Ltd., Hyderabad (1 sheet) Ex.P.122: Demand draft dt.30.12.02 for Rs.9,00,000/- Ex.P.123: Demand draft dt.30.12.02 for Rs.9,00,000/- Ex.P.124: Demand draft dt.30.12.02 for Rs.8,41,061/- Ex.P.125: Attested copy of statement of L.W.5 Jitendar Tulsian under sec.108 of Customs Act dt.28.11.03 Ex.P.126: Attested copy of office order dt.3.4.03 about duty for the month of April, 2003. Ex.P.127: Release advice Number dt.21.1.03. R.A.No.S/32- JNPT/ICD/Muland/1006/DEPB/2002 Ex.P.128: TRA Dispatch Register containing signature on 21.1.03 at Sl.No.23 with said entry along with cover of the book. Ex.P.129: Statement dt.9.12.05 along with letter and other photo copies of enclosures. Ex.P.130: Relevant portion in sec.161 Cr.P.C., Statement of P.W.43 Ex.P.131:Attested Photostat copy of the register of Directorate General of Foreign Trade, New Delhi from 2.6.2000 to 29.6.2001 (9 sheets). Ex.P.132: File of Zonal Head Quarters of Directorate General of Foreign Trade, relating to transfer of DEPB scripts to the Zonal units of Directorate General of Foreign Trade (281 sheets) Ex.P.133: Attested Photostat copy of bulletin register, New Customs House, Mumbai Ex.P.134: Specimen initials (five sheets) Ex.P.135: Specimen handwriting of P.W.47 regarding numerical numbers 0 to 9 (five sheets) Ex.P.136: Specimen bulletin stamps of New Customs House, Mumbai (five sheets).

137C.C.2/2007/Prl. CBI

Court/VSP

Ex.P.137: covering letter dated 28.4.2005 by Asst. Commissioner of Customs, Vigilance Section, Mumbai, to Inspector of Police, CBI, along with enclosed office note sheet Ex.P.138: Specimen signatures of P.W.48 Ex.P.139: Photostat copy of Manual of security instructions issued by Chief Controller of Imports and Exports, New Delhi (44 sheets) Ex.P.140: Photostat copy of O&M instruction no. 11/2001 dated 30.08.2001 issued by Director General of Foreign Trade, New Delhi (11 sheets) Ex.P.141: Account opening form of Overseas Traders represented by Proprietor Anil Kumar Gupta (A.3) along with PAN Card, Pass port and Voter ID Copy Ex.P.142:Statement of account of Overseas Traders for the period 1.10.2002 to 31.3.2003 to CBI in Delhi Ex.P.143: Letter dt.21.11.2001 to Deputy Commissioner of Customs, Mumbai, in page Nos.237 and 238 of Ex.P.132. Ex.P.144: Specimen initials given by P.W.61 in five sheets to CBI for sending them to expert on 05.01.05 in the presence of Mr. Thanekar who is a witness. Ex.P.145: CL Application dt.20.9.2004 Ex.P.146: CL Application dt.03.9.2004 Ex.P.147: RH Application dt.02.11.2004 Ex.P.148: Signature of the applicant in CL application of one P. Taruna P. Lulla dt.16.6.2003 Ex.P.149: CL Application of Taruna P. Lulla dt.19.11.2004 Ex.P.150: Original demand draft application form dated 27.12.2002 for issuance of Demand Draft in the name of Sri Sakshi Impex for Rs.26,71,395/- Ex.P.151: Demand draft application form dated 30.12.2002 for issuance of D.D., in the name of Sri Sakshi Impex for Rs.26,41,061/- payable at Delhi Ex.P.152: Order issued by Government of India, Ministry of Finance dated 13.7.2010 (downloaded copy) Ex.P.153: Sanction order dt.28.3.2016 issued against A.13. Ex.P.154: Bill dt.7.2.03 Ex.P.155 : Confirmation slip in respect of the sale Ex.P.156: Photo and Signature portion of A-1 Ex.P.157: Original FIR in RC.1(E)/2004 Ex.P.158: Original Register of DEPB Receiving Register for the period from 1.7.02 to 5.11.2002 Ex.P.159: Original register of DEPB Receiving Register for the period from 1.4.02 to 28.6.02 Ex.P.160: Original register of DEPB Receiving Register for the period from 6.11.02 to 19.12.02. Ex.P.161: Translation of L.D.141 to 145 statements recorded by Hindi police and also FIR, charge sheet translations Ex.P.162: Computer generated license of DEPB/Advance License No.0510071454 along with sec.65-B Certificate Ex.P.163: Computer generated license of DEPB/Advance License No.0510071850 along with sec.65-B Certificate Ex.P.164: Computer generated license of DEPB/Advance License No.0510071452 along with sec.65-B Certificate Ex.P.165: Computer generated license of DEPB/Advance License No.0510071219 along with sec.65-B Certificate Ex.P.166: Computer generated license of DEPB/Advance License No.0510071664 along with sec.65-B Certificate Ex.P.167: Computer generated Edit report No.0502004029 dt.17.4.02 along with sec.65-B Certificate Ex.P.168: Computer generated Edit report No.0502018402 dt.17.4.02 along with sec.65-B Certificate 138C.C.2/2007/Prl. CBI

Court/VSP

Ex.P.169: Computer generated Edit report IEC No.0502005173 dt.22.4.02 along with sec.65-B Certificate Ex.P.170: Computer generated Edit report dt.4.8.1995 IEC No.0595022006 dt.17.4.02 along with sec.65-B Certificate Ex.P.171: Computer generated Edit report dt.5.11.1999 IEC No.0599039795 along with sec.65-B Certificate Ex.P.172: Computer generated Edit report dt.20.7.1998 IEC No.0598020217 along with sec.65-B Certificate Ex.P.173: Computer generated Edit report dt.10.5.96 IEC No.0596007469 along with sec.65-B Certificate Ex.P.174: Computer generated Edit report dt.14.6.02 IEC No.0502018879 along with sec.65-B Certificate Ex.P.175: Computer generated Edit report dt.1.4.1988 IEC No.058804189 along with sec.65-B Certificate Ex.P.176: Statement of account of City Bank pertaining to M/s.Satyam Impex, Mumbai Ex.P.177: Copy of extract of the DEPB file register pertaining to JNCH for the period from September, 2002 to November, 2002 Ex.P.178: L.D.97 to 105 containing intercity deposit slips Bunch of papers (deposit slips and cheques and pay orders) Ex.P.179: Original import export file of M/s. Global Exports, Mumbai Ex.P.180: Original import export file of M/s. Sai International, Mumbai. Ex.P.181: Letter dt.19.12.02 of Anil Kumar, Suptd., of Overseas Traders addressed to M/s.Kedia Overseas Ltd., enclosing original receipt of M/s.Skylark Express. Ex.P.182: Original debit note dt.23.12.02 of M/s. Paramahans Trading Company for DEPB License No.0510071684 Ex.P.183: Original debit note dt.16.12.02 of M/s. Paramahans Exports for DEPB License No.0510071850 Ex.P.184: Original debit note dt.28.11.02 of M/s. Sakshi Impex for two DEPB License Nos.0510071219 and 0510071452 Ex.P.185: Letter dt.28.1.03 of M/s. Prerna International Delhi, addressed to M/s.Kedia Overseas Ltd. Ex.P.186: Letter dt.29.1.03 of M/s.Global Exports, Mumbai Ex.P.187: Photo copy of debit note dt.7.1.03 of M/s. Satyam Impex, Mumbai. Ex.P.188: Original debit note dt.23.1.03 of M/s.Sai International, Mumbai. Ex.P.189: Credit note dt.17.12.02 of M/s.Overseas Traders, Meerut Ex.P.190: Original DO.SG/MISC-35/2003 SIIB JNCH, dt.2.6.03 (20 sheets) Ex.P.191: D.D. application form dt.28.12.02 of Lord Krishna Bank, Noida Ex.P.192: Certified copy of office order No.07/94 dt.18.2.1994 issued from O/o customs, Jawahar Custom House, Nhava Sheva, Maharashtra Ex.P.193: Attested photo copy of extract of relevant pages of TRA dispatch register maintained at Jawahar Custom House, Nhava Sheva (6 sheets) Ex.P.194: A photocopy of statement of Dinesh Jain, Proprietor of M/s. Laxmi Enterprises, Delhi, under sec.108 of Customs Act. Ex.P.195: Statement of Sri K.V. Karne, Employee of CHA. Radhakrishna Shipping Pvt. Ltd., under sec.108 of Customs Act. Ex.P.196: Original Panchanama dt.10.7.03 recorded by Sri Harish P. Gori, Mumbai and Deepak. Ex.P.197: Original panchanama dt.2.7.03 recorded by T.K. Manik, Mumbai and Smt. R. Johnson along with enclosures. Ex.P.198: Original panchanama dt.3.7.03 recorded by Balkishore Singh and Sarkar Meetai along with enclosures. Ex.P.199: Statement of Sajid Khan dt.3.7.03 recorded under sec.108 of Customs Act. Ex.P.200: Statement of Sajid Khan dt.9.7.03 recorded under sec.108 of Customs Act.

139C.C.2/2007/Prl. CBI

Court/VSP

Ex.P.201: Statement of Sajid Khan dt.15.7.03 recorded under sec.108 of Customs Act. Ex.P.202: Specimen signatures of P.H. John FTDO, Collected by P.W.70 Ex.P.203: Specimen signatures of Smt. S. Pushkaran, FTDO, Collected by P.W.70 Ex.P.204: Specimen of the Security seal used by Sri P.H. John FTDO, Collected by P.W.70 Ex.P.205: Specimen of the Security seal used by Smt.S. Pushkaran,FTDO, Collected by P.W.70 Ex.P.206: Specimen signatures of K.P. Singh, FTDO, Collected P.W.70 Ex.P.207: Specimen initials of D.K. Jain, Appraisal, Jawahar Custom House, Nhava Sheva Collected by P.W.70 Ex.P.208: Specimen signatures of S.B. Arondekar collected by P.W.70 Ex.P.209: Specimen initials of S.B. Arondekar collected by P.W.70 Ex.P.210: Specimen signatures of S.R. Sakar collected by P.W.70 Ex.P.211: Specimen initials of S.R. Sakar collected by P.W.70 Ex.P.212: Specimen initials of B.K. Saxena collected by P.W.70 Ex.P.213: Specimen initials of P.K. Saxena collected by P.W.70

Ex.P.214 to Ex.P.220: Specimen writings of Harish V. Talreja (A.7) (seven sheets) Ex.P.221: specimen impressions of TRA Rubber stamp of Jawahar Customs House Ex.P.222: Specimen impression of computer entry rubber stamp of Jawahar Custom House Ex.P.223: Specimen impression of JNCH office rubber stamp Ex.P.224: Specimen signatures of A.2 Ex.P.225: Specimen signatures of A.2 Ex.P.226: Specimen signatures of Narendra Kumar (A.4) Ex.P.227: Specimen signatures of Rajan Gupta (A.16) Ex.P.228: Specimen signatures of Anil Kumar Gupta (A.3) Ex.P.229: Specimen signatures of Shirom Kumar (A.15) Ex.P.230: Specimen writings of Rajan Gupta (A.16) Ex.P.231: Specimen writings of Anil Kumar Gupta (A.3) Ex.P.232: Specimen writings of Anil Kumar Gupta (A.3) Ex.P.233: Specimen signatures of Harish V. Talreja (A.7) Ex.P.234: CFSL Report dt.30.12.2005 (17 sheets) Ex.P.235: CFSL Report dt.28.2.2006 (17 sheets)

LIST OF WITNESSES EXAMINED ON BEHALF OF DEFENCE.

NIL

LIST OF DOCUMENTS MARKED ON BEHALF OF DEFENCE.

NIL

MATERIAL OBJECTS MARKED ON BEHALF OF PROSECUTION

NIL

Sd/- A. Gayathri Devi,

PRL. SPL. JUDGE FOR C.B.I. CASES,

VISAKHAPATNAM

Copy submitted to 140C.C.2/2007/Prl. CBI

Court/VSP

The Hon’ble Registrar (Judicial), High Court of Judicature at Hyderabad for the State of Telangana and the State of Andhra Pradesh

Copies to:

1. The A.3, A.4, A.5, A.6, A.15 and A.16

2. The Superintendent of Police, C.B.I., Visakhapatnam.

3. The Joint Commissioner of Customs, Jawaharlal Nehru Customs House, Nhava Sheva, Dist. Raighad, Maharashtra, for information.

4. The Central Forensic Science Laboratory (CFSL), 3rd floor, EVK Sampath Maaligai, 68, College Road, Chennai-600 006.

//True copy//

Prl. Spl. Judge for CBI Cases, Visakhapatnam.

IN THE COURT OF THE PRINCIPAL SPECIAL JUDGE FOR C.B.I.

CASES, VISAKHAPATNAM.

Present: Smt. A. GAYATHRI DEVI, Prl. Spl. Judge for C.B.I. Cases, Visakhapatnam.

Thursday, this the 29th day of March, 2018

C.C.No.49/2010

Between:

State represented by Inspector of Police, CBI, SPE, Visakhapatnam.

…Complainant And:

1. Bandi Babu Rao, s/o Bhushanam, aged 66 years, Branch Manager, Vijaya Bank, Vijayawada, residing at 57-10-10, New Postal Colony, Patanata, Vijayawada-520006. (Accused No.1)

2. Ananata Ramchandra Rao, s/o Venkatappaiah, aged 62 years, Business, r/o A-5, Anantha Enclave, Prajashakthi Nagar, Vijayawada-10.(Accused No.5).

3. Potluri Srinivasa Rao, s/o Subba Rao, 48 years, Business, r/o G.F.- 2, Ramakrishna Towers, 2nd lane, Balaji Nagar, Krishna Lanka, Vijayawada. (Accused No.6)

4. Chigrupati Ramalingeswara Rao, s/o Sambasiva Rao, aged 42 years, r/o D.No.12-146, Yanamala Kudura, Vijayawada. (Accused No.8)

5. Ananthaneni Sivarama Krishna, s/o Rama Rao, aged 44 years, Business,r/oD.No.19-148, Mandapam street, Yanamala Kuduru, Vijayawada. (Accused No.9) 2C.C.49/2010/Prl. CBI

Court/VSP

6. Yenigala Venkata Siva Rama Krishna, s/o Satyanarayana, aged 44 years, Business, r/o D.No.20- 26,YanamalaKuduru, Vijayawada. (Accused No.10)

7. Chigrupati Manmadha Rao, s/o Sambasiva Rao, aged 41 years, Business,r/oD.No.12-146, Yanamala Kuduru, Rauaulava Mandal, Vijayawada. (Accused No.11)

8. Anumakonda Veera Venkata Narayana Rao, s/o Surya Prakasha Rao, aged 48 years, Business, r/o D.No.30-5-22, Koka Chalapathi Rao Street, Durga Agraharam, Vijayawada-520002. (Accused No.12)

9. Narra Raghu Babu, s/o Gopala Krishanaiah, aged 49 years, Business, D.No.61-3/1-1/2, SF-2, Sri Sheetal Vihar, Balaji Nagar, Krishna Lanka, Vijayawada. (Accused No.13)

10. Chadalawada Sri Rani, w/o Tanneru Srinivasu, aged 58 years, Doctor in A.P. State Govt. Hospital, Vijayawada, r/o 20-3/1- 48, 2nd floor, Krishna Nagar, Labbipeta,Vijayawada. (Accused No.14)

11. Tanneru Srinivasu, s/o T.V. Rao, aged 58 years, Business, r/o 20- 3/1-48, 2nd floor, Krishna Nagar, Labbipeta,Vijayawada. (Accused No.15)

12. Panchakarla Naga Vittal, s/o Raghunath Rao, Business, r/o D.No.1-138, Ramalayyam Street, Ramavarappadu,Vijayawada. (Accused No.17) 3C.C.49/2010/Prl. CBI

Court/VSP

13. Chadalawada Srinivas Rao, s/o Venkateswar Rao, aged 48 years, Business, r/o D.No.5-116, Jamilly Hospital Road, Poranki (Near Ghantaiah house), Vijayawada. (Accused No.18)

14. Khambham Purna Chandra Rao, s/o Lakshman Rao, aged 44 years, r/o D.No.48-11-13, Temple Street,Currencynagar, Gudupadu,NearMoovva, Vijayawada. (Accused No.19)

15. Potluri Raghu, s/o Subba Rao, aged 54 years, Lecturer in Statistics, Govt. aided college, r/oGujjenagulla,Guntur-6. (Accused No.20).

16. Cholla Venkata Nageswar Rao, s/o Narayana Swamy, aged 54 years, Business, r/o D.No.5-149, EluruRoad,Ravavarapadu, Vijayawada.(Accused No.22) (charge sheet is not filed against A.2, A.3 and A.7) (Case against A.4 and A.21 is abated) (Case against A.16 is split up as C.C.35/17)

….. Accused No.1,5,6,8 to 15, 17 to 20 and 22

This case has come up on 21.03.2018 for final hearing before me in the presence of Sri B.S.P. Chowdhary, Ld. Public Prosecutor for the State-Complainant and of Sri N.V.V.Prasad and Sri N. Sankar, Ld. Advocates for A.1, Sri Ch. Venkateswara Rao, Advocate for A.5, Sri G.V.A. Sai Baba, Advocate for A.8, A.9 and A.11, Sri M.V. Sudhakar, Advocate for A.10, Sri S. Rajendra Prasad, Advocate for A.12, Sri G.V.P.B.S.N. Murthy, Advocate for A.14, A.15 and A.17 and Sri M. Rave Raaj, Advocate for A.6, A.13, A.18 to A.20 and A.22 and the matter having stood over for consideration till this day, this Court doth the following:

J U D G M E N T

4C.C.49/2010/Prl. CBI

Court/VSP

The State represented by Inspector of Police CBI, SPE,

Visakhapatnam filed charge sheet in RC.02(A)/2006 against the

Accused No.1,4,5,6,8 to 22 for the offence U/secs. 120-B r/w 420, 468 and 471 of Indian Penal Code (hereinafter referred to as ‘IPC) and against A.1 under Sec. 13(2) r/w 13(1)(d) of Prevention of Corruption

Act, 1988 (hereinafter referred to as ‘P.C. Act, 1988).

2.The case of prosecution, in nut shell, as per charge sheet is summarized as under:

i)A.1 while working as Branch Manager of Vijaya Bank, Vijayawada, from June, 2004 to April, 2005 entered into criminal conspiracy with builders A.2, A.4,A.12,A.13,A.22 at Vijayawada and in pursuance of the same, he sanctioned three housing loans for total amount of

Rs.36,00,000/- and directed R. Vijaya Lakshmi, Assistant Manager, to sanction five housing loans of Rs.40 lakhs and Smt.K.D. Rajeswari,

Assistant Manager, to sanction three housing loans of Rs.16.30 lakhs by abusing his official position without following the lending discipline and banking guidelines and without verifying title deeds, subsequent

E.Cs., and without obtaining certified copies of title deeds from concerned Sub Registrars along with encumbrance certificates before appraising the loan proposal and sanctioned the loans.

ii)A.8 fraudulently applied for a loan of Rs.9 lakhs on 18.6.2004 to buy a flat from A.4 and submitted copies of link documents, sale agreement, construction agreement, fabricated copies of IT returns for consideration of loan sanctioned without verifying IT returns and collection of margin money A.1 dishonestly sanctioned loan of Rs.9 lakhs to A.8 and credited the loan proceeds to the account of 5C.C.49/2010/Prl. CBI

Court/VSP

A.4/builder before receiving the sale deed. A.4 fraudulently created fake sale deeds after receiving the sale proceeds in favour of A.8 and submitted the same to bank in conspiracy with A.8 and A.1.

Consequently A.4 submitted fake E.C., to A.1. When fraud came to light

A.4 executed genuine sale deeds in favour of A.8.

iii)A.9, A.10 and A.11 fraudulently applied for housing loan of Rs.9 lakhs each on 22.7.2004, 20.7.2004 and 22.7.2004 respectively to buy a flat from A.4 and submitted copies of link documents, sale agreement, construction agreement, fabricated copies of IT returns for consideration of loan sanctioned. A.1 entered into criminal conspiracy with A.4 and in pursuance of the same he directed R. Vijaya Lakshmi,

Assistant Manager to sanction loans to A.9 to A.11 stating that he veriied IT returns and they paid margin money in cash to A.4. Hence, loans were sanctioned accordingly, amount was credited to SB account of A.4 before receiving sale deeds as per the instructions of A.1. A.1 though conducted second check of the documents with a malafide intention did not get the IT returns verified from IT department but signed in Doc.-54. A.4 after receiving loan proceeds created fake sale deeds and submitted the same to Bank and even fake E.C., was submitted by A.4 in conspiracy with A.9 to A.11 and A.1. When fraud came to light, A.4 executed genuine sale deeds in favour of A.9 to

A.11. A.4 again fraudulently registered the same Flat No.104 in Sri

Ekarudradevi Apartments to A.10 under sale deed No.5110/2005 at

Patamata SRO dated 15.11.2005 and submitted sale deed to A.1 to create equitable mortgage in Bank. So also A.4 again fraudulently registered same Flat No.104 to A.10 under sale deed No.642/2006 at 6C.C.49/2010/Prl. CBI

Court/VSP

Patamata SRO on 15.2.2006 and obtained loan of Rs.9 lakhs on the same property by creating equitable mortgage from Punjab National

Bank and received the amount. A.4 registered the same Flat No.104 to

A.10 under registered sale deed No.2867/06 at Patamata SRO on 15.6.2006 and obtained loan of Rs.9 lakhs fraudulently from Diwan

Housing Finance Ltd., and received the amount.

iv)A.6 fraudulently applied for a loan of Rs.6.5 lakhs from Vijaya

Bank to buy Flat No.2 in Sridevi Manikanta Nivas, Devi Nagar and submitted sale agreement, construction agreement signed by

A.7/builder and fabricated IT returns and submitted the same to Bank.

A.13 fraudulently applied for a lon of Rs.6.5 lakhs to buy Flat No.2 in

Sridevi Manikanta Nivas, Devi Nagar and submitted sale agreement, construction agreement signed by A.7/builder and filed fabricated IT returns and submitted the same to Bank. A.16 fraudulently applied for a lon of Rs.6.5 lakhs to buy Flat No.1, second floor, Sridevi Manikanta

Nivas, Devi Nagar and submitted sale agreement, construction agreement signed by A.7/builder and filed fabricated IT returns and submitted the same to Bank.

v)A.1 entered into criminal conspiracy with A.6 and in pursuance of the same directed Smt.R. Vijaya Lakshmi to sanction the loans of

Rs.6.5 lakhs each to A.6 and A.13 and accordingly, she sanctioned the4 loan without collecting margin money, verifying IT returns before receiving the original sale deed. A.1 delivered pay orders to A.6 instead of disburising the same to A.7/Subbareddy.

vi)A.3 as per instructions of A.1 sanctioned a loan of Rs.6.5 lakhs to

A.16 without collecting margin money, verifying IT returns and 7C.C.49/2010/Prl. CBI

Court/VSP receiving the original sale deed. A.1 disbursed the amount to A.6 instead of disbursing the same to A.7/builder. A.1 dishonestly did the second check of the documents verified the same and has signed Doc- 54 as a Fraud preventive measure in case of A.6, A.13 and A.16. A.1 in conspiracy with A.6 accepted fake sale deeds dishonestly without obtaining further legal opinion on the sale deeds. He did not go through Sub Registrar Office to obtain EC but accepted the fabricated

E.Cs., submitted by the loanees after disbursal of the loans. A.20 conspired with his brother A.6 and impersonated A.7 and opened account in the name of A.7 and S. Sridevi in Swastik Mercantile Bank,

Vijayawada. A.12 introduced A.20 as A.7. A.6 signed cheque leaves as

A.7 and handed over to A.6 who received money under the cheques from his account and handed over the cheques worth Rs.20.5 lakhs to

A.12 as commission for arranging fabricated IT returns, sale deeds,

E.Cs., and introducing A.20 as A.7 and Smt.P.Lakshmi Rani as

Smt.S.Sridevi. A.6 actual owner of the property at present under

Doc.No.14984/2004 dated 1.12.2004 against which he availed loan by creating a fake sale deed. A.13 availed housing loan against the property of R.V.S. Srikanth who is actual owner of property under

Doc.No.7925/2005. A.16 availed loan against the property of B.N.P.Rao and Smt.B.Rajeswari covered under Doc.No.204/2005. A.12, A.7 and

Smt.S. Sridevi have sold these properties to A.6, R.V.S. Srikanth and Sri

B.N.P. Rao and Smt.P.Rajeswari.

vii)A.14 and A.15 applied fraudulently for housing loan of Rs.9 lakhs to Vijaya Bank to purchase Flat No.1, Second floor, I-building, M/s.Sri

Venkateswara Estates, Vijayawada, from A.5 and A.14 and A.15 8C.C.49/2010/Prl. CBI

Court/VSP fraudulently submitted false sale agreement, construction agreement purported to be signed by A.5 who is the Managing Partner of M/s.Sri

Venkateswara Estates, H-block Partnership Firm which own the schedule flat. A.5 knowing fully well that he already sold the same Flat to Smt.Dodda Sunitha on 26.2.2003 conspired with A.14 and A.15 and created false agreement on 15.6.2004 with so that A.14 and A.15 can avail housing loan. A.1 without verifying the ownership of the fact and

IT returns of the applicant and co-applicant dishonestly sanctioned the loan and disbursed the amount without receiving the sale deed. A.14 and A.15 got the same encashed fraudulently through A.12 who fraudulently opened an account in the name of M/s.Sri Venkateswara

Estates, H-block Partnership Firm in M/s.Swasakthi Mercantile Co- operative Bank and deposited the D.Ds., and withdrawn the same and distributed the proceeds among A.15, A.1 and himself. After disbursement of loan A.12 handed over fake sale deed to A.15 who submitted the same to A.1. A.1 without obtaining legal opinion on fake sale deed accepted fabricated E.C., subsequently submitted by A.12.

After withdrawing the loan amount A.12 had closed the account. It is revealed that A.14 and A.15 availed housing loan fraudulently on the property of Dodda Sunitha who purchased the same under sale deed

No.562/2003 dated 26.2.2003.

viii) A.17 applied for housing loan of Rs.16 lakhs from Vijaya Bank to purchase a building consists of ground and first floor at

Ramavarappadu from A.22. A.1 dishonestly did not obtain original title deed of the property from A.22. He obtained sale agreement only. A.1 did not verify the IT returns submitted by A.17, A.22 and 9C.C.49/2010/Prl. CBI

Court/VSP

Smt.Ch.Lakshmi Kumari but sanctioned the loan to A.17. Without receiving sale deed in favour of A.17, A.1 handedover the amount to

A.22 who opened bank account in M/s.Swasakthi Mercantile Bank

Limited with the introduction of A.12. A.22 fraudulently got the fake sale deed prepared through A.12. A.22 after receiving money handed over the fake sale deed to A.17 who submitted the same to Bank. A.22 gave Rs.10 lakhs to A.12 towards commission for arranging fake original sale deed, fake IT returns, fake sale deed executed by A.22 and fake subsequent E.C. A.1 dishonestly did not go to SRO to receive the sale deed executed by A.22 in favour of A.17and did not obtain further legal opinion on sale deed and subsequent E.C. A.22 is still owner of the property. He mortgaged original sale deed in SBH, Civil Courts

Branch, Vijayawada.

ix)A.18 applied for loan of Rs.5 lakhs to Vijaya Bank to purchase

Flat No.2 in Sheetal Vihar, Krishnalanka, Balaji Nagar, Vijayawada from

A.13. A.18 submitted fake IT returns, link sale deed, sale agreement executed by A.13 to Bank. As per the instructions of A.1 without collecting margin money and verifying IT returns Smt.K. Daisy

Rajeswari sanctioned loan of Rs.5 lakhs dishonestly to A.18 and disbursed the same to A.13 without receiving the sale deed. A.1 conducted second check of the documents, verified the same and signed Doc-54 but did not point out these defects dishonestly. A.13 submitted fraudulently a fake sale deed to the Bank. Smt.K.D.

Rajeswari dishonestly accepted the same without obtaining legal opinion and E.C. A.12 fraudulently introduced the account of A.13 in 10C.C.49/2010/Prl. CBI

Court/VSP

Swasakthi Mercantile Bank. A.13 after receiving the money submitted fake sale deed to A.1. A.13 is still owner of the property.

x)A.19 applied for loan to purchase Flat No.1, Ground floor, Alfala

Residency, New Sanath Nagar, Vijayawada, from A.6 and Sri Uppuluru

Venu and submitted fraudulently sale agreement, construction agreement signed by A.6 and U.Venu. As per the instructions of A.1,

A.3 sanctioned loan to A.19 without collecting margin money, verifying

IT returns and receiving the original sale deed. She disbursed the pay orders to A.6. A.1 dishonestly carried out second check of the documents, verified the same and signed Doc-54 as a fraud preventive measure. A.1 dishonestly did not ensure receipt of sale deed from SRO, further legal opinion and further E.C., burt accepted fabricated E.Cs., submitted by loanee. Sheik Mohammed Ali Beig is present owner of the property. A.6 and A.21 who impersonated U.Venu opened fraudulently account in Swasakthi Mercantile Bank. A.12 introduced A.21 as U.Venu. A.6 deposited Pay orders in this account and encashed the same and handed over Rs.20.5 lakhs to A.12 from the account of S. Subbareddy and S. Sridevi as commission for arranging fabricated IT returns, sale deeds, E.Cs., and introducing A.21 as U. Venu. Thus, A.1 in criminal conspiracy with A.4, A.6, A.8 to A.22 committed cheating by personation, cheating by dishonestly inducing delivery of property, forgery for the purpose of cheating, using as genuine a forged document and criminal misconduct by abusing his official position as public servant thereby cause wrongful loss of

Rs.90.6 lakhs to the Bank and corresponding wrongful gain to A.4, A.6, 11C.C.49/2010/Prl. CBI

Court/VSP

A.8 to A.22 and as such punishable under sec.120-B, 419, 420, 468, 471 and under sec.13(2) r/w 13(1)(d) of P.C. Act, 1988 .

3.On filing charge sheet case was taken cognizance against A1 under secs.120-B r/w 420 , 468 and 471 of IPC and Sec. 13(2) r/w 13(1)

(d) of PC Act, 1988 and against A4 to A6, A8 to A.19 and A.22

U/secs.120-B r/w 420, 468 and 471 IPC and against A.20 and A.21 under secs.120-B r/w 419, 420, 468 and 471 of IPC and summons were served upon the accused. On their appearance copies were furnished.

4.Case against A.4 and A.21 was abated on 17.01.2011 and 21.1.2013 respectively and case against A.16 was split up as

C.C.35/2017 on 12.9.2017. Hence, the present case is against A.1, A.5,

A.6, A.8 to A.15, A.17 to A.20 and A.22 only.

5.Upon hearing both sides, charges under secs.120-B, 420, 468, 465 r/w 471 of IPC against A.1, A.5, A.6, A.8 to A.15, A.17 to A.20 and

A.22 and under sec.13(1)(d) r/w 13(2) of P.C. Act, 1988 against A.1 were framed read over and explained to them for which they pleaded not guilty and claimed to be tried.

6.On behalf of prosecution PWs.1 to 22 were examined and exhibits P.1 to P.351 were marked.

7.On closure of evidence on prosecution side, accused were examined under Sec.313 Cr.P.C and they denied the incriminating evidence and written statements were filed by A.1, A.5, A.6, A.8 to

A.11, A.15, A.17, A.19 and A.22. On behalf of accused no oral evidence is adduced but got marked Exs.D.1 and D.2 in cross examination of

P.W.4, Ex.D.3 in cross examination of P.W.5, Ex.D.4 in cross examination 12C.C.49/2010/Prl. CBI

Court/VSP of P.W.10, Ex.D.5 in cross examination of P.W.3 and Exs.D.6 to D.15 by consent.

8.Heard the Ld. Counsel for accused and Ld. Public Prosecutor for prosecution. Perused the material on record and written arguments of both sides.

9.Now the points of determination are :

1. Whether prosecution has established the offence of criminal conspiracy under sec.120-B against A.1, A.5, A.6, A.8 to A.15, A.17 to A.20 and A.22 beyond reasonable doubt?

2. Whether prosecution has established offence U/sec. 420 IPC against A.1, A.5, A.6, A.8 to A.15, A.17 to A.20 and A.22 beyond reasonable doubt?

3. Whether prosecution has established offence U/sec. 468 of IPC against A.1, A.5, A.6, A.8 to A.15, A.17 to A.20 and A.22beyond reasonable doubt?

4. Whether prosecution has established the offence U/sec. 465 r/w 471 IPC against A.1, A.5, A.6, A.8 to A.15, A.17 to A.20 and A.22 beyond reasonable doubt beyond reasonable doubt?

5. Whether prosecution established offence against A.1 U/sec. 13(1)(d) r/w 13(2) of PC Act beyond reasonable doubt?

10.PROSECUTION CASE:

i)Devotion to duty is the highest form of worship of

God….Swami Vivekananda .

ii)Increase in number of bank frauds and waste of substantial public money expose lack of commitment and devotion in officers of

Banks towards their duties.

iii)Sans the unnecessary details, case of prosecution, is as follows :

A1 while working as Branch Manager of Vijaya Bank, Vijayawada during the period 2004 to April 2006 entered into criminal conspiracy with the builders A4, A12, A6, A13 and A22 and in pursuance of the same sanctioned and disbursed loan amounts without receiving the 13C.C.49/2010/Prl. CBI

Court/VSP genuine sale deeds, obtaining legal opinions, to the builders who entered into false agreements with 11 borrowers i.e., A.6, A.8 to A.11,

A.13 to A.19 and executed false sale deeds in favour of the loanees and submitted false sale deeds to vijaya bank and A1 sanctioned 3 loans, A2 (FIR accused) sanctioned 5 loans and A3 (FIR accused) sanctioned 3 loans upon the instructions of A.1 and due to the said conspiracy with builders though borrowers submitted fake IT returns and builders submitted fake sale deeds and subsequent fake E.Cs., released loan amounts to builders without verifying the same by abusing his official position as public servant and they utilized the amounts for construction of flats/houses and sold them to persons other than the borrowers and thus caused total loss of Rs. 90.06 lakhs to the bank in 11 loans and corresponding wrongful gain to A.4,A.6, A.8 to A.22 and borrowers and thus committed offences punishable under

Sec. 120-B , 419, 420, 468, 471 and U/sec. 13(2) r/w 1391)(d) of PC

Act, 1988.

11.DEFENCE OF ACCUSED:

1)Accused No.1:

A1 assailed the case of prosecution mainly on the following grounds:

i)He sanctioned only 3 loans of accused i.e. A8 , A14, A15 (Common loan ) and A.17 in accordance with rules , circulars, rules and guidelines; ii) The then Loans officer late M.V.Subba Rao has prepared , checked and recommended and then only these 3 loans were sanctioned after obtaining legal opinion in respect of the same; 14C.C.49/2010/Prl. CBI

Court/VSP iii) There is no established procedure to verify whether any other bank has granted housing loan to the same flat for which loan to be granted in this bank. After these loans , the practice of registering mortgaged deed in favour of the bank has come into force to avoid multi financing for the same flat by different banks; iv) All the three loans are disbursed in phased manner as per the rules of the bank and bank has created valid equitable mortgage by depositing title deed of each flat basing on encumbrance certificate;

and

v) A.1 neither committed any illegality or irregularity in granting these loans nor caused any loss to the bank intentionally and bank has already filed two OA's i.e. OA86/2007 and OA 103/2007 before Debt

Recovery Tribunal, Visakhapatnam against A.14 , A15 and A17 and OS 639/2009 on the file of III Addl. Senior Civil Judge, Vijayawada against

A8 and no allegations were made against A.1 in these O.As.

2)Accused No.6 and 19:

The defence of A6, A19 is common and it is mainly as follows:

i)A.6, A19 are innocent and did not commit any offence as alleged; ii)Loan was taken by producing genuine documents as required by the bank and availed the loan but due to internal rivalry of the bank employees and to implicate A.1, higher officials have chosen to victimize the borrowers also and they became scapegoats in that plan; 15C.C.49/2010/Prl. CBI

Court/VSP iii) A.6 and A19 have cleared entire loan on 21.2.2006 by remitting cash in Vijaya Bank, main branch, Vijaywada and their accounts were closed on 22.2.2006 and FIR was registered on 22.2.2006; and iv) During the course of examination by Inspector CBI itself though

A.6, A19 informed that their accounts were cleared and no loss was caused to the bank deliberately they were falsely implicated in this case and relevant documents were suppressed.

3)Accused No.8,9,10 and 11:

The defence of A.8 and A.9 , A10 and A.11 is common . It is mainly on the following grounds :

i) A8 to A11 are innocent and did not commit any offence as alleged; ii) A.4 invited A8 to A.11 to his house and appraised them about construction and development of business and informed that he constructed flats in his property and offered such flats by arranging housing loans and as such A.8 to A.11 have signed in few papers in the house of A.4 for purchase of one flat each and housing loan was sanctioned to them by Vijaya bank after obaining legal opinion from their panel advocate; iii) Loan amount was disbursed directly to A.4 by Vijaya bank; iv) Subsequently A.8 tol A.11 came to know that sale deeds executed by A.4 in their favour were not duly registered before the concerned SRO and registered documents fabricated by A.4 were handed over by A.4 to the bank and as such A.8 to A11 questioned A4 16C.C.49/2010/Prl. CBI

Court/VSP about the same and got regular registered sale deeds in their favour and deposited them in Vijaya Bank;

v) Inspite of the same, officials of Vijaya Bank got evicted A.8 from the said flat and conducted auction in respect of the same without following due process of law and recovered the amount from auction purchaser; and vi) Infact A.8 to A.11 incurred loss because entire loan amount from bank was received by A.4 but payments were made by them to the

Bank and they did not play any role in fabrication of the sale deeds and they are falsely implicated in this case.

4)Accused No.14 & 15:

The defence of A.14 and A.15 is mainly as follows:

i) A.14 and A.15 are innocent and falsely implicated; ii) They are cheated by A.5 and A12 and he came to know the same later and A.14 and A.15 did not receive single pie from the bank towards loan; and iii)They neither submitted fake or forged documents nor entered into any agreement. No notices were issued about the said loan.

5)Accused No.20 and A.21:

The defence of A.20 and A.21 is they are innocent and falsely implicated.

6)Accused No.12:

The defence of A.12 is as follows:

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i)A.5 executed G.P.A. as Managing Partner of M/s.Venkateswara

Estates in favour of A.12 and by submitting all documents opened

A/c., in Swasakthi Mercantile Bank, Vijayawada and he is no way concerned with sale transactions in favour of A.14 and A.15; ii)A.12 did not execute sale deed in favour of A.14; and iii)He is no way concerned with transactions in favour A.14 & A.17.

7)Accused No.22:

The defence of A.22 is mainly as follows:

i) A.22 is innocent and falsely implicated; ii)A.22 has given all loan documents pertaining to his nephew i.e.

A.17 without his knowledge and consent to A.12 who promised that he would get the loan sanctioned; iii) The loan standing in the name of A17 was managed by A.12 and loan proceeds were availed by A.22 and A.17 is innocent and did not sign in any documents; and iv) As A22 has no malafide intention to cheat the bank, he submitted letter for one time settlement to repay the outstanding loan.

12.POINTS NO.1 AND 2:

It would be convenient to jointly discuss the charges leveled against A.1, A.5, A.6, A.8 to A.15, A.17 to A.20 and A.22 under secs.120-B and 420 of IPC covered under points 1 and 2.

13.LAW ON THIS ASPECT:

At this juncture it is necessary to focus upon the essential ingredients of Secs.120-B and 420 IPC.

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1. Sec.120-B IPC Essential ingredients:

The essence of criminal conspiracy is an agreement to do an illegal act and such an agreement can be proved either by direct evidence or by circumstantial evidence or by both and in a matter of common experience that direct evidence to prove conspiracy is rarely available. Accordingly, the circumstances proved before and after the occurrence have to be considered to decide about the complicity of the accused. Even if some acts are proved to have been committed, it must be clear that they were so committed in pursuance of an agreement made between the accused persons who were parties to the alleged conspiracy Inferences from such proved circumstances regarding the guilt may be drawn only when such circumstances are incapable of any other reasonable explanation. In other words, an offence of conspiracy cannot be deemed to have been established on mere suspicion and surmises or inference which are not supported by cogent and acceptable evidence.

2. Sec.420 IPC Essential ingredients:

i)The essential ingredients of the offence of ‘cheating and dishonestly inducing the delivery of property’, punishable under section 420 IPC., are as follows:

(i) A person cheats;

(ii) He thereby dishonestly induces the person deceived –

(a) to deliver any property to any person, or

(b) to make other or destroy the whole or any part of a valuable security or anything which is signed or sealed and which is capable of being converted into a valuable security.

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Court/VSP ii)On plain reading of the above ingredients, it is obvious that for conviction under section 420 IPC, prosecution must be able to prove that the complainant parted with his property acting on a representation which was false to the knowledge of the accused; that the accused had dishonest intention from the outset and that the property in the hands of the person cheated must have passed on to the person who cheats. In other words, the offence of cheating and dishonestly inducing the delivery of property was complete as soon as the property was handed over to the accused.

14.CITATIONS:

a)To buttress the contention of prosecution regarding sec.120-B and 420 of IPC, learned Public Prosecutor placed reliance upon the following rulings of various Courts:

1. In Mir Nagvi Askari Vs. CBI in Crl.Appeal No.1525, 1526/2004

dated 7.8.2009 wherein attention of Court was drawn to the following

para about principles of conspiracy:

“A conspiracy is hatched in secrecy and it is difficult, if not impossible, to obtain direct evidence to establish the same. The manner and circumstances in which the offences have been committed and the accused persons took part are relevant. For the said purpose, it is necessary to prove that the propounders had expressly agreed to it or caused it to be done, and it may also be proved by adduction of circumstantial evidence and/or by necessary implication.”

2. In CBI Vs. Mahindra Singh reported in AIR 2015 Supreme Court 3657 their Lordships erudite as follows regarding settling the matter with banks by paying amount subsequent to the committing of offence:

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Court/VSP “In economic offences Court must not only keep in view the money has been paid to the Bank which has been defrauded but also the society at large.

“It is not a case of simple assault or a theft of a trivial amount, but the offence with which we are concerned is a well planned with deliberate design for personal profit regardless of consequence to society. To quash the proceedings on the ground that accused settled the amount with Bank would be a misplaced sympathy. It is not such a case where one can pay the amount ad obtain a ‘no due certificate’ and enjoy the benefit of quashing the criminal proceedings on the hypothesis that nothing more remains to be done.”

3. State of Maharashtra through CBI Vs. Vikram Anantrai Doshi and others reported in 2014 (10) Scale 690 wherein the Lordships observed in para no.23 as follows:

“The modus operandi as narrated in the charge sheet cannot be put in the compartment of an individual or personal wrong. It is a social wrong and it has immense societal impact. It is an accepted principle of handling of finance that whenever there is manipulation and cleverly conceived contrivance to avail of these kind of benefits it cannot be regarded as a case having overwhelmingly and predominatingly of civil character. The ultimate victim is the collective. It creates a hazard in the financial interest of the society. The gravity of the offence creates a dent in the economic spine of the nation. The cleverness which has been skillfully contrived, if the allegations are true, has a serious consequence. A crime of this nature, in our view, would definitely fall in the category of offences which travel far ahead of personal or private wrong. It has the potentiality to usher in economic crisis. Its implications have its own seriousness, for it creates a concavity in the solemnity that is expected in financial transactions.” 21C.C.49/2010/Prl. CBI

Court/VSP

4.Bhatnagar Vs. Sate of Maharashtra reported in AIR 1979 SC 826 wherein the prosecution relied upon the following principle:

“Abuse of position, in order to come within the mischief of

Section 5(1)(d) of P.C. Act, musts necessarily be dishonest and it must be proved that the accused caused deliberate loss to the department.”

b)Learned counsel for A.5 cited the following decisions to fortify his contention:

1. In Magan Biharilal Vs. State of Punjab reported in AIR 1977

Supreme Court 1091; the Lordships held hat no conviction can be held on opinion of expert.

2. In S. Gopala Reddy Vs. State of A.P. reported in AIR 1996

Supreme Court 2184 wherein regarding the expert evidence the

Lordships held that:

“the evidence of an expert is rather a weak type of evidence and

Courts do not generally consider it as offering conclusive proof and therefore, safe to rely upon the same without seeking independent and reliable corroboration;

c)Whereas Ld.Counsel for A1 placed reliance upon the following decisions in support of the contentions of A.1:

1. K.Kishore Kumar Reddy Vs State represented by Spl.

Public Prosecutor and another reported in 2011 (1) ALT

Criminal 65 AP under Sec. 482 , Sec. 120-B r/w Secs 419, 420, 467 and 468 IPC and Sec. 13(2) r/w Sec. 13(1)(d) of PC Act, the Lordships succinctly held that :

“when material on record does not disclose criminal intention on the part of the advocate in giving legal opinion he cannot be 22C.C.49/2010/Prl. CBI

Court/VSP expected to know that the property was mortgaged twice earlier and it is not his duty to identify the borrowers and conduct search of their documents.

2. In T.Nagendra Kumar and others Vs State CBI represented

by its Public prosecutor, High Court of AP reported in 2011 (2)

ALT Criminal 113 under Secs. 420, 471, 465, 477-A, 468, 120-B IPC and 139 of NIAct and Sec. 13 of PC Act and Secs 105 and 106 of

Evidence Act the Lordships erudite that on the facts of the case it is improbable for conspiring together for purchase of demand draft which are already purchased.

3. In CBI Hyderabad,Vs K.Narayana Rao reported in 2012 (3)

Supreme Court cases, Criminal 1183 the lordships observed as follows:

“As to when panel advocate of the bank be made liable for criminal conspiracy as follows: Merely because the legal opinion given by panel advocate may not be acceptable , he cannot be fasted with criminal prosecution in the absence of tangible evidence that he aided or abated other conspirators. At the most he may be liable for gross negligence or professional misconduct if established by evidence. Since there is no such tangible evidence against him in this case proceedings against him are rightly squashed.

The Lordship further observed that :

“offence of conspiracy cannot be deemed to have been established on mere suspicion and surmises or inference not supported by cogent and acceptable evidence. Since direct evidence to prove conspiracy is rarely available the circumstances proved before and after the occurrence have to be considered to decide about the complicity of accused.” 23C.C.49/2010/Prl. CBI

Court/VSP

4.In State CBI/SPE/Hyderabad Vs K.Jaipal Reddy reported in 2016 (2) ALT Crl.97 AP U/secs. 120-B, 419, 420, 468 and 471 of IPC and Secs 13(2) r/w 13(1)(d) of PC Act the Lordships held as follows .

“It is the duty of panel advocate only to scrutinize the documents furnished with and give legal opinion. If the sale deed is found to be fake document bank cannot fasten criminal liability or responsibility upon panel advocate for not causing personal enquiries in concerned officers regarding genuineness of the document. Mere violation of internal guidelines which have no force of statute do not attract penal provisions.”

5.In SVL Murthy Vs. state represented by reported in CBI 2009 (2) ALD Crl. 478 Supreme Court; the Lordships held that mere procedural irregularities which resulted loss do not by itself would not attract ingredients of the offence of cheating under sec.420 of IPC.

6.In G. Narasimha Murthy Vs. State of AP reported in 2014 (2)

ALT (Crl.) 121 AP the Lordships succinctly held that deviation of rules on procedures by a public servant may result in misconduct attracting departmental action but criminal misconduct needs more than mere deviation.

15.On the touchstone of these legal principles, case of prosecution must be tested.

16.BURDEN OF PROOF:

Condition precedent for holding the accused persons guilty of charge of criminal conspiracy must therefore, be considered on the anvil of the fact which must be established by the prosecution, viz., meeting of minds of two or more persons for doing or causing to be done an illegal act or an act by illegal means.

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17.To establish the case, Prosecution examined P.Ws 1 to 22 and got marked Exs.P.1 to P.351 . Out of P.Ws. 1 to 22 , P.W.2 is Advocate,

Vijayawada, P.Ws.1, 4, 10 , 11 and 17 are respective Sub Registrars,

P.Ws.3, 5 to 7, P.Ws.11 and 15 are the officials of various cadres of

Vijaya Bank , Vijayawada, P.Ws. 13 and 14 are officials of other banks i.e. SBH and Bank of Baroda, PWs.8, 9 and 18 are officers of Swasakthi

Mercantile Cooperative Bank, Ltd, Vijayawada, Pw.16 is GEQD Expert ,

PW.15 is sanction authority , PW.19 is Principal of PG courses , JKC college, PW.21 is income tax officer and PW.22 is IO.

18.Before we delve into points in controversy, at the outset it must be stated that out of 22 accused initially A.1 to A7 are mentioned in FIR, thereafter A.8 to A.22 are arrayed in the charge sheet on the ground that their involvement was established during investigation and

A2 and A3 RLOs of Vijaya Bank, Vijayawada are not prosecuted on the ground that sanction order is not issued against them and A.7 was not charge sheeted on the ground that no incriminating evidence was found against him during investigation. Hence A2, A3 and A7 are not charge sheeted, A4 and A21 are no more and case is abated against them. Case against A.16 is split up as C.C.35/17. Hence out of 22 accused 16 remained. Out of them A6, A8 to A11 , A13, A14& 15 (Joint

Loan), A17 to A19 are borrowers, A6, A13 and A22 are builders, A.12 allegedly introduced borrowers and fraudulently got opened account in

Swasakthi Mercantile Bank and diverted some loan amounts, appropriated the same and received Rs.20.5 lakhs from impersonation of account of S. Subba Reddy and S. Sreedevi, A20 and 21 allegedly impersonated others relating to the transactions in this case.

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19.DUTIES & RESPONSIBILITIES OF A.1 & RLOs., AS PER

CHARGE SHEET:

a)Regarding the outlines of duties of Branch Manager/A.1, in the very first para of the charge sheet itself it is averred that, “duty of

A.1/Branch Manager include processing, sanctioning and disbursing of housing loans and he should follow lending discipline in all housing loans and he was empowered to process and sanction housing loans independently and it is mandatory on his part to carry out second check of processing, sanctioning and disbursing of housing loans carried out by the RLOs., working under his supervision in the Branch and after thoroughly satisfying with the documents obtained A.1 has to sign in Doc.54 in respect of the loans sanctioned and disbursed by the

Retail Lending Officers and himself.

b)In third and fifth paras of the charge sheet, it is averred that as per Circular No.7/04 dated 12.1.2004 R. Vijayalakshmi/P.W.3 and K.

Daisy Rajeswari/P.W.12. the then RLOs.., have assisted and reported to

A.1 one after other and duties of RLO incharge include canvassing/marketing of banks detail lending schemes, pre sanction scrutiny, sanction and disbursal of loans.

c)The learned Senior Counsel for A.1 assiduously argued submitted that the total process of receiving loan applications, sanction of the loans, disbursement of loans, execution of loan documents, pre and post sanction inspections and follow up recovery of loan are the responsibilities of RLOs only after issuing Ex.D.5 instructions to RLOs., and for the acts made by RLOs., A.1 cannot be made liable and though these two RLOs., who admittedly sanctioned in 26C.C.49/2010/Prl. CBI

Court/VSP total eight loans out of eleven loans are arrayed in FIR as A.2 and A.3, they were deliberately removed in the charge sheet in order to help them and to victimize A.1.

d)Interalia, learned Public Prosecutor canvassed that though the post of RLOs., was introduced admittedly during relevant period of loans in this case it did not take away the responsibility of A.1/Branch

Manager in going through the entire procedure right from the receiving of loan applications till the sanction of loans and disbursal of the amounts and on the other hand at the time of signing in Doc.54, the

Branch Manager shall ensure the compliance of all the relevant circulars and manual of instructions in obtaining the documents and sanction of the loans and added to that P.Ws.3 and 12 RLOs., clearly deposed that the said scheme of RLOs., was introduced for the first time and as such they did not know anything about the new instructions and they have followed totally the instructions of A.1 in sanctioning these loans and in all these eleven loans A.1 signed in memorandum of deposit of title deeds, certificates regarding property and pre/post sanction inspections, Doc.54 credit appraisals and endorsed on instalment letters to release loan amount in only two or three instalments with short duration in utter violation of the circulars and given entire amounts to the builders.

e)In the light of the aforementioned rival contentions, we shall now proceed to focus upon relevant circulars in this connection.

20.CIRCULARS AND BANKING REGULATIONS:

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a)Regarding duties of Branch Managers , RLOs and procedures to be followed in sanction of housing loans, prosecution got marked

Exs.P.46to P.49 and P.50 circulars and Ex.P.51 Manual instructions through P.W.5/S.V.Venkata Ratnam.

b)In order to appreciate the issues involved in the instant case properly, it is necessary to set out in brief the working modalities under various circulars with regard to housing loans.

c)In Ex.P.46 Circular No.7/04 dated 12.1.2004 admittedly it was introduced that certificate of loan papers i.e., Doc.54 should invaribly be countersigned by the Branch Head to which RLO is attached.

d)The purpose of issuing Ex.P.46 circular is clearly mentioned as follows:

“since the Board while reviewing the report raised by the

Vigilance Department, HO, on frauds for the Quarter ended

September, 2003, has expressed concern over the increase in frauds detected in the retail lending of the Bank, it is felt necessary to put in place certain preventive measures to mitigate the occurrence of such frauds in disbursal of retail loans by Retail Lending Outlets. Against this backdrop, it has been decided to put in place a system wherein all loans sanctioned/disbursed by RLOs., should be subjected to

second check in the following manner with immediate

effect.”

e) The aforementioned purpose in issuing Ex.P.46 circular 7/04 is quite obvious. As a preventive measure three conditions are mentioned in this circular.

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i) The first one is certificate of loan papers obtained (Doc.-54) should invariably be countersigned by the Branch Head to which RLO is attached and specimen of Doc.-54 is enclosed to the Circular and duty was imposed upon the Branch Managers to ensure the lending discipline is observed in every respect while signing Doc.-54 for the loan sanctioned and disbursed by RLOs., attached to such branches. ii)

Second condition is Regional Office should conduct random scrutiny of sanction/disbursement of loans by RLO., atleast once in fifteen days or more frequently by deputing an Officer depending upon the volume of business.

iii) Third condition is Regional Office should form a squad comprising of atleast two to three officers well versed in advances to carryout such random check in rotation.

f)Ex.P.47 Circular No.63/05 dated 19.4.2005 is nearly one year three months subsequent to Ex.P.46 circular. The purpose and back ground of giving this circular is summarized as under:

“in view of increasing NPAs., and other irregularities in pre and post sanction stages in Retail loans it has been decided to make the following changes in the functioning of the RLOs.

ii)In the first para, it is mentioned that bank has established 82

Retail lending outlets to step up disbursements under retails lending schemes. In total eight changes in the functioning of RLOs., are mentioned in the Circular. The important changes madeare enumerated as follows:

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(a)RLO incharge should report to Branch Manager instead of

Regional Manager but continue to submit weekly progress report to Regional Manager through the Branch Manager.

2) the duties of RLO incharge include canvassing/marketing of

Banks Retail lending schemes and pre sanction scrutiny.

He/she should also assist the Branch in post sanction follow up and recovery. The processing of loan applications,

execution of loan documents shall be the Branch

subjects hereafter.

g)As per second point admittedly the power vested in RLO incharge in respect of sanction of loan is withdrawn and conferredupon respective Branch Managers.

h)Ex.D.5 appointment letter dated 11.6.03 given to P.W.3/RLO on which much reliance is placed by A.1 is much prior to Exs.P.46 circular

dated 12.1.2004 and Ex.P.47 circular dated 19.4.2005. Admittedly,

P.W.12/Daisy Rajeswari of RLO succeeded P.W.3/R. Vijayalakshmi, RLO and worked from 26.10.2004 to 7.3.2006. Whereas, P.W.3 worked as

RLO from July, 2003 to August, 2004.

i)Second para of Ex.D.5 appointment order given to P.W.3/RLO reads as follows:

“This designation is subject to the scheme as provided below and subject to the guidelines issued by Head Office/Regional office from time to time.”

j)Though Ex.D.5 appointment letter did not specifically mention the role of Branch Manager in the Housing loans and highlighted the multi faceted role placed upon the shoulders of RLOs., in housing 30C.C.49/2010/Prl. CBI

Court/VSP loans, six months after giving the said appointment to P.W.3,

Vijaya Bank issued Ex.P.46 Circular consciously keeping second

check of every sanction/release of the loans by RLOs., on the

ground of increasing frauds detected in retail lending of the bank and to mitigate the occurrence of such frauds by enclosing specimen of Doc.54. What circular was in force and binding during the relevant time.

k)According to the charge sheet, loan application of A.8 is 18.6.2004, A.9 is 22.7.2004, A.10 is 20.7.2004, A.11 is 22.7.2004, A.6 is 10.7.2004, A.14 and A.15 joint loan is 6.9.2004, A.17 is 4.1.2005,

A.18 is 18.3.2005 and A.19 is 11.4.05. Material on record shows that under Exs.P.65,P.81, P.101, P.120, P.162, P.182, P.31, P.242, P.260 sanction letters loan was sanctioned to A.8 on 28.6.04, A.9 on 27.7.04,

A.10 on 27.7.04, A.11 on 27.7.04, A.13 on 31.7.04, A.14, A.15 on 5.10.04, A.17 on 10.1.05, A.18 on 18.3.05, A.19 on 18.4.05 respectively. A.6 loan was sanctioned on 13.7.04. The

aforementioned dates of loan applications and sanction letters

exfacie show that they are subsequent to Ex.P.46 circular. As mentioned supra second para of Ex.D.45 appointment order clearly mentions that designation of Retail Lending officer is subject to guidelines issued by Head office/Regional office from time to time.

Hence undisputedly Ex.P.46 circular was in force very much

binding upon A.1 and P.W.3 and P.W.12/12 RLOs.

l)Hence, in all the loans in this case compliance of Ex.P.46

circular which was in force by the date of loan application

must be ensured. A conjoint reading of Exs.P.46, P.47 circulars and 31C.C.49/2010/Prl. CBI

Court/VSP

Ex.D.5 makes it abundantly clear that duties for the first time conferred upon RLOs., were restricted drastically in the backdrop of increasing

NPAs., frauds and irregularities. Hence, the duty of processing of loan applications, execution of loan documents, sanction of loans, post sanction and recovery were also withdrawn from RLOs., and the duties of RLOs., from Ex.P.47 circular are only canvassing/marketing of banks retail lending schemes and pre sanction scrutiny and assisting the branch in post sanction follow up and recovery.

m)That apart conditions mentioned in the printed formats of Doc.54 and sanction letters fixing responsibilities upon A.1 also have to be highlighted.

21.DOC.54:

a)Certificate of Loan papers obtained/Doc.54 is a printed format which contains 12 columns. 1st and 2nd columns are regarding name of borrower with address and name of guarantors. 3rd and 4th columns are in respect of sanction number, date and reasons if conditions of sanction are not fulfilled. Columns 5 to 9 are regarding processing charges collected with date, nature of advances and account, sanctioned amount, rate of interest and date of loan papers. 10th and 11th columns are in respect of date of filing charge with ROC if borrower is Limited Company and specifications of 1st, 2nd charge and modification.12thcolumnisregardingdetailsof papers/documents/security obtained/held in custody and value of them. Hence, columns 1 to 12 contains all crucial details in respect tof loans, documents and security obtained.

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b)At the end of 2nd page under 12th column the following certification is mentioned:

“I/we confirm that all the necessary loan documents, as per the guidelines, contained in the booklet on loan documentation and various Head office circulars and circular letters issued from time to time, in respect of the above advance have been obtained and the said documents have been duly filled up in all respects and appropriately stamped and executed in my presence and that they are in order. I/We further confirm that all the conditions stipulated in the sanction letter are duly complied with”.As per the aforementioned confirmation Branch Manager should sign and ensure obtaining and execution of duly filled and stamped loan documents in their presence and that they are in order and conditions stipulated in sanction letters are complied with in accordance with guidelines in booklet as loan documentation, Head office circulars and circular letters from time to time. Branch Manager as well as Officers and Assistant

Branch Manager should sign at the end.

c)Hence, signing of Branch Manager in Doc.54 as mentioned in

Ex.P.46 Circular contemplates checking of everything commencing from obtaining of loan papers till the compliance of condition in sanction letter as per the printed confirmation and certification at the end of Doc.54.

d)At this juncture, we should also look into what conditions will be incorporated in sanction letter.

22.SANCTION LETTER:

a)Sanction letter in all these loans is a printed format containing 10 columns. In the very first sentence before commencing of columns it is mentioned that advance is sanctioned subject to the following among other conditions. Margin money, Mode of disbursement and terms of 33C.C.49/2010/Prl. CBI

Court/VSP repayment are also mentioned in 5th to 7th columns. 9th and 10th columns mention several terms and conditions. Compliance of all these conditions must be ensured before signing in Doc.54 as per certificates therein.

b)The aforementioned discussion leaves no doubt that as per the circulars in force only condition in printed formats of Doc.54 and sanction letter are incorporated and compliance of Ex.P.46 circulars as well as conditions in Doc.54 and sanction letter must be ensured in sanction and disbursement of loans.

c)Thus, discussion on the aforementioned circulars makes it clear that duties of Branch Manager are to process the loan applications, execution of loan documents, post sanction recovery, sanction/disbursement of loans and forwarding weekly progress report submitted by RLOs., to Regional Manager through him and counter signing of certificate of loan papers obtained i.e., Doc.-54 to which

RLO., is attached and ensure that lending discipline is observed in every respect while signing Doc.-54.

d)Ex.P.48 copy of Circular No.131/2002 dated 29.10.2002 is regarding revised comprehensive housing loan scheme and detailed check list of documents and procedures to be followed by Branch like verification of IT returns, obtaining of approved building plan copy, detailed estimation cost for construction, obtaining request letter at each stage of release and conducting pre sanction inspection of the property by branch officials.Ex.P.49 is copy of Circular

No.208/2005 regarding consolidated guidelines on housing loans which states that applicant should have marketable title over the property, building plan should be approved by Corporation, pre 34C.C.49/2010/Prl. CBI

Court/VSP sanction scrutiny to be done with regard to genuineness of IT returns.

Ex.P.50 is copy of manual of instructions 2002-2003 regarding housing finance. Ex.P.51 is copy of manual of instructions regarding SB accounts and opening of accounts. Exs.P.48 and P.50 were in force by the date of sanction and disbursement of loans in this case and they should be followed.

e)Admittedly, an officer of a bank holds a position of trust.

Each one of them keeping in view the nature and extent of duties required to be performed is expected to do so not only in terms of statutory directions but as also the directions issued by RBI and his own employer. The banking norms and manual of instructions are certainly binding on its officers and bank officers are not expected to do according to their whims and fancies to give undue advantage or favour to some of the loan applicants by entering into criminal conspiracy.

f)It is the consistent plea of prosecution that A.1/Branch

Manager has committed many irregularities and not followed any of the Banking norms issued for sanctioning the housing loans for construction of houses/flats and he failed to verify the genuineness of

IT returns and plan approval copy submitted by all the applicants in criminal conspiracy with other accused which resulted in sanction of eleven loans and wrongful loss of Rs.169.69 lakhs in total to Vijaya

Bank and corresponding wrongful gain to themselves by abusing his position as public servant by resorting to criminal conspiracy, cheating, forging for the purpose of cheating and using false documents as genuine and the accused must be punished under secs.120-B, 420, 35C.C.49/2010/Prl. CBI

Court/VSP 468,471 of IPC and Sec.13(2) r/w 13(1)(d) of P.C. Act, 1988 also in respect of A.1.

g)Learned counsel for A.1 tried to impress upon the Court that page no.22 of Ex.P.49 Circular No.208/05 dated 3.12.05 mentions that pre sanction scrutiny of salary certificates/IT returns is mandatory as per Head office circular No.42/05 dated 15.3.2005 and at the time of sanction of loans in this case there was no such mandate. In page

No.22 of Ex.P.49 under the heading 'pre sanction scrutiny of salary certificates and IT returns relevant portion reads as follows:

“The incidents of frauds in a few branches in the borrowal accounts has been a major concern for the bank. Apart from the act of wilful defaults diversion of funds, availing of loans by production of fake salary certificates or IT returns are on increase in the banking Industry. The reasons for occurrence of such frauds related to fake salary certificates/IT returns are mainly attributed to the laxity on the part of sanctioning authority in the proper verification of related documents. Time and again through issuance of various circulars it has been emphasized about the importance of prior verification of genuineness of salary certificates/IT returns before sanctioning of loans”.

h)The aforementioned contents in the circular about the verification of IT returns shows that even prior to Ex.P.49 circular also there were instructions to verify the IT returns as well as salary certificates prior to sanction of loans and non verification resulted in increasing frauds and diversion of funds.

i)Ex.P.48 circular No.131/02of Vijaya Bank dated 29.10.02 page 10 mentioned the checklist for Branches and pre sanction requirements.

Under pre sanction requirements at page No.10 it is clearly mentioned 36C.C.49/2010/Prl. CBI

Court/VSP that copies of income tax assessement order or Income Tax return submitted and duly received by IT authorites of the applicant/guarantor for the last two years should be received along with housing loan applications. At page No.13 it is mentioned that

before release of loan it should be ensured that the applicant

has first duly invested his own contribution/margin, i.e., total cost of the house less the amount of housing loan sanctioned by the Bank and loan should be released in four to five convenient instalments depending upon the progress of construction and second and subsequent instalment shall be released only upon the full and satisfactory utilization of earlier released instalments and proof of utilization of each instalment shall be obtained and appropriate follow up/utilization report shall be made in parties file and before release actual work completed should be inspected.

j)Ex.P.50 Manual of Instruction for the year 2002-03 at page 384 mentions that along with loan application copies of Income Tax

Assessement orders and IT returns of the applicant/guarantor for the last two years and for the business class and others copies of balance sheet/profit and loss accounts for the past three years duly certified by Chartered Accountant and Income Tax Assessment Orders and returns for the past three years shall be obtained.

k)At pages 7 and 8 of the said Circular the appraisal of loan

applicant through personal interview, financial and technical

appraisal of the proposal are mentioned in detail. Under that heading it is clearly mentioned that Branch Manager/Loan Appraiser

should conduct personal interview of the loan applicant based

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Court/VSP on the loan application form submitted by him to ascertain whether the proposal is prima facie acceptable or not. Under the heading 'Financial Appraisal of the proposal' it is clearly mentioned that the source of income as declared by the loan applicant should be confirmed and it should be ensured that the income declared is reasonable and not inflated.

l)The aforementioned Exs.P.48 and P.50 Circular and manual of instructions during the period 2002-03 which were admittedly in

force by the time of sanction of the eleven loans in this case in

2004 clearly contemplates conducting personal interview of the loan applicant by the Branch Manager to ascertain loan proposal is prima facie acceptable and copies of IT returns along with Assessment orders must be obtained for the two years in case of normal applicants and for three years in case of business persons and source of income of the loan applicant for repayment of loan should be ensured by the Branch

Manager prior to the grant of loan and checking the IT returns submitted by the borrowers is not an empty formality. Further the words “time and again through issuance of various circulars importance of prior verification of IT returns before sanction of loans was emphasized before sanction of loans” in Page No.22 of Ex.P.49 relied upon by the learned counsel for A.1 clearly shows that verification of IT returns before sanction of loan is not newly introduced through Ex.P49 circular only.

m)Out of eleven loans, admittedly P.W.3/RLO she sanctioned five loans to A.6, A.9, A.10, A.11 and A.13, P.W.12/RLO sanctioned 38C.C.49/2010/Prl. CBI

Court/VSP three loans to A.16, A.18 and A.19 and A.1 sanctioned the remaining three loans to A.8, A.14 and A.15 (joint loan) and A.17.

n)It is pertinent to note that in all these loans, A.1 signed in

certificate, pre/post sanction inspection reports, SB account

opening forms, memorandum of deposit of title deeds, Doc.54,

credit appraisal forms in many loans and permitted release of

instalments of loan in many loans.

23.ROLE OF A.1 IN ALL THE LOANS:

a)P.W.3/RLO who sanctioned seven loans out of eleven loans clearly deposed at page No.3 of chief examination as follows:

“Branch Manager used to conduct borrower interview and processing of loan, verification of IT returns and pre sanction of property. Branch Manager i.e., A.1 was the supervising officer for housing loans. A.1 used to write appraisal note and process note as I was new to that job at that time. A.1 himself used to maintain liaison with panel Advocates and approved valuers of the Bank because A.1 is local. He used to bring the borrowers also”.

At page no.4 she further deposed as follows:

“The loan amount was released in all these cases on the instructions of the Branch Manager to the clerical staff. The loan amounts in all these cases were credited to the accounts of borrowers. A.1 Branch Manager himself used to collect the D.Ds., and handed over the same to builders. A.1 himself verified income tax returns, Doc.54 was signed by him, pre sanction and post sanction inspection was done by him, property inspection was done by him and sanction order was passed by A.1 and loan amounts were disbursed by A.1 and ultimately credited to the account of the builder in all these cases”.

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In page No.7 P.W.3 clearly deposed as follows:

“witness adds whereas in her case because she was new to loans portfolio in good faith towards the Branch Manager she used to sanction the loans processed by the Branch Manager.

There is handwriting of Branch Manager to show that these loans were processed by Branch Manager. Witness adds these five loans were processed by A.1.”

b)Inspite of cross examination at length P.W.3 clearly explained that because she was new to the loans portfolio at that time by simply reposing faith in A.1/Branch Manager she sanctioned the loans processed by him and the five loans sanctioned by her contains

the handwriting of A.1 to show that they were processed by

him. She also strongly denied the suggestion that in sec.161 Cr.P.C., statement she failed to mention that A.1 himself verified IT returns, signed in Doc.54, done pre sanction, post sanction and property inspection and sanction order was passed by A.1 and loans were disbursed by him which were ultimately credited to the accounts of the builder.

c)P.W.12/Daisy Rajeswari, RLO who succeeded P.W.3 and sanctioned only 3 loans out of eleven loans deposed in chief examination that after introduction of the concept of RLOs., Branch

Manager is also equally competent to process sanction and disbursal of housing loans and sale deed and E.C. in loans of A.8, A.14, A.16, A.18 and A.19 were obtained by A.1 himself. But in cross examination contradicting the same she deposed that the then Assistant Manager

Subba Rao used to collect documents from the parties including 40C.C.49/2010/Prl. CBI

Court/VSP registered documents mortgaged to the bank in loans granted by herself and A.1.

d)The aforementioned change of version in crucial aspect relating to the loans shows that witness is not reliable and trust worthy.

24.SANCTION:

a)P.W.15/M.K.Sashidhara Rao, DGM, Personnel Department, IRD,

Vijaya Bank, deposed that he issued Ex.P.317 Sanction order against

A.1 after going through the entire material sent to him and Ex.P.316

Employees Discipline Appeal Regulation, 1981 is the competent authority to sanction prosecution against officers in Scale-I Assistant

Manager, Scale-II Manager, Scale-III Senior Managers. He strongly denied the suggestion that Ex.P.370 is replica of the specimen sanction order sent by CBI and he did not apply his mind in issuing the sanction order. Nothing useful to the case of A.1 was elicited from P.W.15.

b)Hence, Ex.P.317 is a valid sanction order to prosecute A.1.

c)Before adverting to the loans, since plea of submission of fake sale deeds and E.C., is common in all the loans we shall now proceed to throw focus on them.

25.FAKE SALE DEEDS:

a)According to the case of prosecution fake sale deeds were submitted by the builders of the loanees in bank in conspiracy with A.1 and loaneesand A.1 without verifying the fake sale deeds and obtaining legal opinion disbursed the loan amounts to the builders.

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b)To establish the said version of prosecution about the fake sale deeds, P.Ws.1,2, 4, 6, 10, 11, 12 and 17 were examined.

c)P.W.1/Y.Narasimha Rao, the then Senior Assistant in SRO,

Patamata, Vijayawada deposed that along with Ex.P.1 letter which is signed by the then Sub registrar Naga Raju, whose signature was identified by him, he handed over certified copies of Exs.P.2 to P.6 to

CBI. He clearly deposed that before issuing Ex.P.1 letter he verified the records of Sub Registrar Office and gave information mentioned in that letter and document bearing numbers 1 to 4000 only were registered in the year 2004 on the file of patamata Sub Registrar office.

d)According to him Exs.P.8 to 12 and P.14 referred to in Ex.P.1 were not registered on the file of Patamata SRO and with the registration numbers mentioned in Exs.P.8 to P.12 and P.14 there are some other documents on the file of SRO, patamata and parties are different and more registration fee is shown in these 6 documents and metal seal will be affixed in all the registered documents in SRO but only rubber seal is affixed in these 6 documents. Through him Exs.P.7 to P.16 sale deeds with translation were marked. According to him he also verified corresponding E.Cs.,in respect of these documents.

e)PW.4/B.Nagaraju , the then SRO, Patamata deposed that

Exs.P.2 to P.6 certified copies mentioned in Ex.P.1 are genuine documents registered on the file of SRO,Patamata and Exs.P.7 to P.16 and P.18 are not genuine documents because they are not registered on the file of SRO, Patamata and seal affixed on these documents is not genuine and instead of metal seal only rubber seal was used in these documents and even signatures are not that of Sub-Registrar's 42C.C.49/2010/Prl. CBI

Court/VSP worked in that office in 2004 and 2005 and by comparing these documents with original documents registered with the same numbers he found that as fake documents.

f)P.W.2/P. Uma Shankar, Advocate, Vijayawada, deposed that in second week of November, 2005 P.W.12/RLO told him over phone that there was suspicion in respect of loan transaction relating to Shyamala

Venkateswara Reddy and immediately he along with P.W.12 who was the then Credit Officer of Vijaya Bank visited the property and found that particular property was purchased by an employee from Co- operative department and subsequently after informing the same to higher authorities Regional Manager of Vijaya Bank addressed a letter asking for details of some other sale deeds.

g)Regarding Exs.P.7 to P.16 and P.18 he deposed that as sought by

Regional Manager of Vijayawada, he verified the details sought for and obtained encumbrance certificates to find out genuineness of documents and from the said encumbrance certificates he could know that scanning numbers were not tallying and stamp endorsements are not genuine and sale deeds sought for were not registered. He further deposed that he gave opinion after this verification stating that out of 32 registered sale deeds supplied to him except first one the remaining documents are fabricated or forged and accordingly, he submitted

Ex.P.17 report to Regional Manager, Vijaya Bank, for taking necessary action on the ground that Exs.P.7 to P.16 and P.18 are not registered land they are fake, fabricated,non existent and not registered on the file of SRO.

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h)In cross examination also he explained that even before receiving letter from Regional Manager, Vijaya Bank, he along with

P.W.12 jointly examined the documents Exs.P.7 to P.16 and P.18 in branch and after receiving the letter both of them went to respective

SROs' for verification of documents and he made 32 applications for obtaining E.Cs., in respect of properties referred to in letter and the

E.Cs., obtained by him were enclosed along with report and the said fact of obtaining E.Cs., and their numbers are clearly mentioned in report and ultimately by verifying the E.Cs., and scanning numbers he formed opinion about genuineness or otherwise of the documents mentioned in Ex.P.17. He strongly denied the suggestion that he did not obtain E.Cs., and contents in the report are false.

i)In this connection, P.W.12/Daisy Rajeswari, Assistant Manager,

Vijaya Bank, deposed that in case of any doubts they used to call Panel

Advocate of the Bank Uma Shankar and along with the said P. Uma

Shankar she visited some properties to verify the ownership and found that owners of the said properties are not the loanees in this case and she immediately informed the said fact to the Regional Manager and

Regional Manager advised P. Uma Shankar to verify the link documents, sale deeds and E.Cs., which were obtained at the time of sanction and thereafter, Regional Manager instructed two Officers of

Vijaya Bank i.e., P.Ws.6 and 7 to visit the Branch and give report and basing on the report given by them A.1 was suspended.

j)P.W.6/Viswajit T.P.S.A. who worked in Regional office of Vijaya

Bank, Vijayawada, deposed that along with Senior Manager

Narasimhulu i.e., P.W.7 he visited Vijaya Bank, Eluru Road branch, for 44C.C.49/2010/Prl. CBI

Court/VSP inspection of certain housing loan documents and submitted Ex.P.272

Joint report observing that the scanning identification number appearing in certain title deeds are not tallying with Sub-Registrar numbers available in Vijayawada and though at the back of title deeds there is endorsement that stamp duty is paid but deficit stamp duty collected seal was not affixed and finger prints of executants are not properly affixed as seen in Normal registered documents. According to

P.W.6 from Exs.P.7 to P.16 and P.18 particularly the following deficiencies were observed:

“parties names are mentioned in Ex.P.272 and limit sanctioned to them and amount released are also covered.36 parties including eleven borrowers in this case are covered and disbursal basing on these documents is not correct.”

k)He further deposed that on verification of E.Cs., in these eleven loans he observed NIL E.C., on the background but writings are super scribed on the E.Cs., and font size of the writings differs from normal size appearing in the E.Cs., and the details are entered in black colour ink and the details in E.Cs., were typed using Electronic Typewriter in different font size.

l)P.W.7/S. Narasimhulu deposed that along with P.W.6 he jointly inspected Vijaya Bank, Eluru Road branch and submitted

Ex.P.272 joint inspection report and according to the said report Exs.P.7 to P.16 and P.18 sale deeds appears to be fake and E.Cs., Exs.P.68,P.84,

P.104,P.123,P.143,P.164,P.185,P.208 and P.265 are fake.

m)P.W.11/P. Yagnanarayana, SRO deposed that metal seal alone will be used in SROs., but in Exs.P.7 to P.16 and P.18 rubber seal is used 45C.C.49/2010/Prl. CBI

Court/VSP and on comparing them with office scanned documents he came to know that they are fake documents.

n)P.W.10/P.V.V. Durga Prasad, SRO, Gunadala, Vijayawada, deposed that in Ex.P.13 rubber seal is affixed though metal seal should be affixed and it is a fabricated document.

o)P.W.17/K. Nageswara Rao, SRO, deposed that in Exs.P.8, P.12 and P.14 sale deeds rubber seal is affixed instead of metal seals and they are fake documents

26.E.Cs.:

a)P.W.11/P. Yagnanarayana, SRO, Patamata, Vijayawada, deposed that if there are registrations in respect of the property in the period applied for, details will be mentioned, otherwise NIL EC will be issued, but in E.Cs., submitted in this case NIL encumbrances as well as registrations are shown. He further deposed that colour printing of the word ‘NIL’ in E.Cs., is different and it is subsequently added.

b)P.W.6/Viswajit T.P.S.A. deposed that on verification of E.Cs., in these eleven loans he observed NIL E.C., on the background but writings are super scribed on the E.Cs., and font size of the writings differs from normal size appearing in the E.Cs., and the details are entered in black colour ink and the details in E.Cs., were typed using

Electronic Typewriter in different font size and as such E.Cs’ are fake.

c)We shall now delve into the loan files in seriatum to scan the evidence and arrive at complicity of accused.

27.LOAN OF A.6:

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i)The case of prosecution in respect of loan of A.6 is as follows:

1)A.6 fraudulently applied for a loan of Rs.6.5 lakhs on 10.7.2004 to purchase Flat No.2, first floor, Sridevi Manikanta Nivas, Devinagar and submitted sale agreement, construction agreement signed by Sri

S. Subba Reddy (A.7)/builder and fabricated IT returns;

2)Inspite of the same since A.1 entered into criminal conspiracy with A.6 and directed P.W.3 to sanction the loan, without even collecting margin money, verifying IT returns and before receiving the original sale deed, she sanctioned the loan and A.1 delivered pay orders to A.6 instead of disbursing the same to the builder S. Subba

Reddy (A.7);

3) A.1 dishonestly without verifying and conducting second check of documents signed in Doc.54 and accepted fake sale deeds without obtaining further legal opinion on sale deeds and accepted fabricated

E.C. submitted by A.6 without going to Sub Registrar office and obtain the same after disbursal of the loan; and

4) Subsequently it is revealed that A.6 is the present owner of the property under document No.14984/2004 dated 1.12.2004 and he availed the loan against that property by creating a fake sale deed.

b)Defence of A.6 is he is innocent and cleared entire loan amount on 21.2.2006 and loan account was closed on 22.2.2006 which is t he date of registration of FIR.

28.Loan Documents:

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i)A careful scrutiny of housing loan documents of A.6 that Ex.P.129 is housing loan application of A.6 mentions his brother A.20 as guarantor and submitted sale agreement and construction agreement allegedly executed by S. Sridevi and S.Subba Reddy/A.7 in favour of

A.6 under Ex.P.131 and alleged fabricated IT returns of himself for the assessment years 2001-2002, 2002-2003 and 2003-2004 under

Ex.P.130 and additional construction agreement dated 17.5.2004 executed in favour of S. Subba Reddy (A.7) by A.6 under Ex.P.13.

Ex.P.134 is opinion of Panel Advocate and Ex.P.8 is the alleged registered sale deed executed by S. Sridevi and S. Subba Reddy (A.7) in favour of A.6 under document No.5461/2004 on the file of SRO,

Patamata, dated 13.7.2004.

ii)P.W.5/S.V. Venkata Ratnam, Assistant Manager in the same branch deposed at page 10 that Ex.P.135 property inspection report was prepared and signed by A.1, Ex.P.137 memorandum of title deeds of A.6 was signed by A.1 and Ex.P.138 certificate of loan papers/Doc.54 was signed by RLO as well as A.1 and Ex.P.40 credit appraisal form was prepared by A.1 and signed by RLO. Further under Ex.P.142 A.1 has permitted to release the loan amount and under Exs.P.146 and P.147 request letters given by A.6 for release of loan amounts, A.1 permitted the same and under Ex.P.148 property inspection report also A.1 signed and permitted to release the loan amount and Ex.P.42 is the loan account and SB account statement of A.6 which reflects the release of loan proceeds on three dates i.e., 13.7.2004, 22.7.2004 and 11.8.2004 in favour of S. Sridevi and S. Subbareddy (A.7) and the three connected pay orders are Ex.P.149.

48C.C.49/2010/Prl. CBI

Court/VSP iii)To prove that Ex.P.8 sale deed is a fake document, as mentioned supra, the prosecution examined P.Ws.1,2,4,6,10,11,12 & 17 and to prove the encashment of pay orders by S. Subbareddy (A.7) fraudulently in conspiracy with A.1, A.12 and A.20 without even purchase of flat by A.6 from S. Subba Reddy (A.7), P.W.17 was examined and Ex.P.334 was marked. Further it is the specific allegation of prosecution that A.6 also induced A.20 i.e., his brother to impersonate S. Subbareddy (A.7) and got opened Ex.P.280 an account in Swasakthi Mercantile Cooperative Bank Limited, Vijayawada in the name of S. Subba Reddy (A.7) and S. Sridevi by affixing photo of A.20 and the same was identified by P.W.19.

iv)P.W.17/Kolli Nageswararao joint Sub-Registrar, Vijayawada who handed over certified copies of documents to CBI deposed that

Ex.P.334 is certified copy of sale deed bearing Document

No.14984/2004 registered on the file of SRO, Gandhinagar, Vijayawada, in respect of same Flat No.2, First floor, Sridevi Manikanta Nivas, executed by S. Sridevi and S. Subbareddy (A.7) represented by GPA holder A.V.V.Narayana Rao/A.12 in favour of A.6.

v)Ex.P.334 is attested copy of registered sale deed dated 1.12.2004 in favour of A.6 for the self same property covered under Ex.P.8 sale deed dated 13.7.2004 executed by the GPA holder of S. Subba Reddy and S. Sridevi i.e., A.12. According to this document A.12 became GPA holder of S. Subba Reddy (A.7) and S. Sridevi under registered GPA

No.217/2004 dated 23.8.2004 which is about one month subsequent to Ex.P.8. Both documents on the face of them appears to have been registered on the file of SRO, Patamata. Though Ex.P.334 document is 49C.C.49/2010/Prl. CBI

Court/VSP five months subsequent to Ex.P.8 sale consideration mentioned in

Ex.P.8 is Rs.3 lakhs and in Ex.P.334 is Rs.2,50,000/-.

vi)Narra Raghu Babu who is A.13 in this case is figured as First attestor as well as identifying witness before the Sub Registrar in

Ex.P.334. When photos of A.6 and A.12 were also affixed in Ex.P.334 and recitals clearly mentions obtaining of loan from SBH, Civil Courts

Branch and issuing of Pay order for Rs.2,25,000/- in that Branch to A.6, it cannot be said that A.6 or A.12 has no knowledge about Ex.P.334.

So also, when photo of A.6 and S. Subba Reddy and his wife Sridevi are affixed in Ex.P.8, it cannot be said that A.6 do not have any knowledge about the fabrication of Ex.P.8 sale deed. If Ex.P.8 is genuine sale deed there is absolutely no need for purchase of the same property again from same vendor under original of Ex.P.334.

vii) Further according to the recitals Rs.25,000/- was paid as advance out of the sale consideration under both documents. According to

Ex.P.334 remaining consideration of Rs.2,25,000/- was paid to GPA holder by way of pay order of State Bank of Hyderabad, Civil Courts

Branch, Vijayawada, dated 30.11.2004 and property was delivered to the purchaser/A.6.

viii)Inspite of the serious allegations of prosecution that Ex.P.8 is a false document submitted for obtaining loan in conspiracy and cheating and under Ex.P.334 infact A.6 purchased the property and obtained loan from SBH, Civil Courts Branch, Vijayawada and mortgaged the very same property and prosecution adduced evidence in this connection and opinion of Expert is signatures of vendor in

Ex.P.8 documents do not tally with their admitted signatures, A.6 did 50C.C.49/2010/Prl. CBI

Court/VSP not adduce any defence evidence either to explain the same or contradicting the said evidence of prosecution.

ix)His only defence is he cleared entire loan on 21.2.2006 by remitting the cash in Vijaya Bank, Vijayawada and his loan account was closed on the date of registration of FIR and as such, he did not cause any loss to the Bank. Mere repayment of money do not absolve criminal liability. Through the aforementioned unimpeachable evidence prosecution proved that A.6 did not purchase flat from S. Subba Reddy (A.7) and S. Sridevi with false and fabricated document Ex.P.8 he could successfully obtain loan and encash the pay orders in conspiracy with

A.1, A.12 and A.20.

x)Further, as deposed by P.W.5 though this loan of A.6 was sanctioned by P.W.3, Ex.P.135 certificate regarding personal opinion of

Branch Manager as to acceptability and value of the property which contains about report of Panel Valuer and Panel Advocate etc., shows that it is signed by A.1 and the property was visited by him personally on 8.7.2004 and Ex.P.137 Memorandum of deposit of title deeds executed by A.6 also contains the signatures of A.6 and A.1 and

Ex.P.138 certificate of loan papers/Doc.54 was signed by A.1 as well as

P.W.3. In Ex.P.142 construction report issued by the Panel Valuer also there is clear endorsement and signature of A.1. Further Ex.P.146 letter requesting for release of loan instalments also contains clear endorsement and signature of A.1 permitting to release Rs.75,000/- . In addition to this Ex.P.148 pre/post sanction report mentions the date of inspection as 2.2.2005 and signed by A.1. Ex.P.148 contains another endorsement and signature of A.1 permitting to release Rs.25,000/-.

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Ex.P.149 which contains three Pay orders dated 13.7.2004, 22.7.2004 and 11.8.2004 were issued in favour of S. Sridevi and S. Subba

Reddy. On the face of them there is clearing endorsement Swasakthi

Mercantile Cooperative Urban Bank Ltd., Vijayawada.

xi)According to P.W.3, Ex.P.40 credit appraisal form of A.6 contains handwriting of A.1 though he has not signed. Ex.P.40 Credit Appraisal is a crucial document which contains personal evaluation of the borrower, technical and legal evaluation, details of property, financial evaluation and how much loan to be given and details of repayments fixed, guarantors and observations and recommendations of the

Appraisal officer recommending the grant of loan by fixing the repayments clearly show that five pages of credit appraisal from the beginning till end including the recommendations and observations of

Appraising Officer are in the same handwriting but there is no signature of A.1 at the end and it was only signed by P.W.3. The fact that entire handwriting in Ex.P.40 is that of A.1 as deposed in chief examination of P.W.3 is not denied by A.1 in giving specific suggestion.

Hence, the said fact of entire credit appraisal in the handwriting of A.1 including recommendations for the sanction of loan coupled with handwriting and signing in Ex.P.135 certificate by A.1 mentioning the date of his personal visit of property as 8.7.2004, signing in Ex.P.137 memorandum of deposit of title deeds, signing in Ex.P.138 Doc.54, signing in endorsement on Ex.P.142 valuation report by Panel Valuer and signing in Ex.P.146 permitting the release of Rs.75,000/- and signing in Ex.P.148 pre and post sanction inspection report clearly mentioning the date of inspection as 2.2.2005 and also endorsement in 52C.C.49/2010/Prl. CBI

Court/VSP the same document with signature of A.1 permitting release of

Rs.25,000/- leaves no doubt regarding the active role played by A.1 in all crucial aspects of process, recommendations, sanction, inspections and disbursement of loan though simply P.W.3 sanctioned the same.

xii)Regarding the encashment of pay orders and opening of account by A.6 in conspiracy with his brother A.20 by impersonating S.

Subba Reddy in Swasakthi Mercantile Cooperative Bank Ltd., we shall go through the testimony of officials of the said bank and the relevant documents.

xiii)In this connection P.W.8 /Officer in the said bank deposed that

Ex.P.280 is Joint SB account opening form of S. Subba Reddy and

S.Sridevi and the said account was introduced by A.12. According to her Ex.P.281 self cheque dated 13.7.2004 in favour of S.Subbaredd (A.7), Ex.P.282 cheque dated 13.7.2004 in favour of A.12, Ex.P.84 cheque dated 23.7.2004 in favour of A.6, Ex.P.285 cheque dated 28.7.2004 in favour of A.6, Ex.P.286 cheque dated 31.7.2004 in favour of A.6, Ex.P.288 cheque dated 11.8.2004 in favour of A.6, Ex.P.289 cheque dated 2.12.2004 issued in favour of A.12, Ex.P.290 cheque

dated 3.12.2004 in favour of A.12, Ex.P.291 cheque dated 16.12.2004

in favour of A.6, Ex.P.292 cheque dated 5.2.2005 in faovur of A.6 were encashed and reflected in Ex.P.293 account statement of S.

Subbareddy (A.7) and S. Sridevi for the period from 13.7.2004 to 1.2.2006.

xiv)Further P.W.18/Y. Chandrasekhar Rao, the then Branch Manager of Swasakthi Mercantile Bank deposed at page No.2 that on 13.7.2004 pay order dated 13.7.2004 for Rs.2,75,000/- and another pay order 53C.C.49/2010/Prl. CBI

Court/VSP under Ex.P.149 for Rs.2,75,000/- were purchased by Swasakthi

Mercantile Cooperative Urban Bank Ltd., and the said pay orders are reflected in Ex.P.293 joint account of S. Subba Reddy (A.7) and S.

Sridevi in that Bank and an amount of Rs.5 lakhs was withdrawn out of the amount covered under the said pay orders by S. Subba Reddy (A.7) and S. Sridevi and out of that amount A.12 received an amount of

Rs.2,35,000/- under cheque No.110627.

xv)He further deposed that Ex.P.149 contains another pay order in favour of S. Subba Reddy (A.7) and S. Sridevi issued by Vijaya Bank, for Rs.75,000/- dated 11.8.2004 and this amount is also reflected in in

Ex.P.293 joint statement of S. Subba Reddy (A.7) and S. Sridevi and

Rs.9 lakhs was withdrawn by A.6 under cheque No.110633.

xvi)According to prosecution in Ex.P.280 joint account opening form of S. Subba Rao/A.7 (FIR accused) and S. Sreedevi instead of the photo of S. Subba Reddy (A.7) the photo of A.20 Potluri Raghu is affixed.

xvii) P.W.19/S. Ramakrishna Prasad deposed that he knew A.20 who has been working as Head of the Department of Statistics in JKC

College and identified photo of A.20 affixed in Ex.P.280 in the place of the photo of S. Subba Reddy (A.7). In cross examination of P.W.19 there is no suggestion to the effect that photo in Ex.P.289 is not that of

A.20 and P.W.19 wrongly identified the phtograph of S. Subba Reddy (A.7) as A.20. That itself fortifies the case of prosecution that the photo affixed in Ex.P.280 in the place of S. Subbareddy (A.7) is that of

A.20.

54C.C.49/2010/Prl. CBI

Court/VSP xviii) But there is absolutely no evidence on record as to whether A.20 himself personally affixed that photo or A.6 who is brother of A.20 affixed that photo in pursuance of conspiracy. Mere identification of photo do not lead to any inference that A.20 personally affixed the same.

xix)Further the questioned signatures of S. Subba Reddy (A.7) and S.

Sridevi which were marked as Q.47 and Q.48 by Expert were opined as forged signatures by expert. As mentioned supra through this SB account of S. Subba Reddy (A.7) and S. Sridevi which was fraudulently opened with the introduction of A.12 with photograph of A.20 huge loan amounts in this case were diverted fraudulently. Without any positive and cogent evidence it cannot be said that A.20 committed offence as alleged by prosecution.

xx)The aforementioned oral and documentary evidence clearly demonstrates without any criminal conspiracy between A.1, A.6 and

A.12 the aforementioned acts of submitting fabricated sale deeds under Ex.P.8 and drawing the loan amount and obtaining another document under Ex.P.334 for the very same property and obtaining loan from SBH and opening of Ex.P.280 joint account by afixing the photograph of A.20 instead of S. Subba Reddy (A.7) and diverting the loan amount is not possible.

xxi)Further P.W.21/P. Nayanatara, Income Tax Officer, deposed that according to prosecution Ex.P.130 Income Tax returns for the assessment years 2001-02, 2002-03, 2003-2004 of A.6 submitted by

A.6 are false. Prosecution contend that Ex.P.143 E.C., on the face of it shows NIL encumbrancesbut mentions document 55C.C.49/2010/Prl. CBI

Court/VSP

No.5461/2004 which is Ex.P.8 transaction though it is fake and all these acts clearly show conspiracy, cheating, forgery and using the forged document as genuine. As deposed by P.Ws.6 & 11, the E.Cs., in all cases shows NIL encumbrances in the middle portion but one transaction above the endorsment “Nil EC” reflecting fabricated sale deeds in respective loan.

xxii)Ex.P.138/certificate of loan papers obtained (Doc.54) which is a printed format contains twelve columns with the crucial details of documents obtained. At the end of this there is printed confirmation which reads:

“I/we confirm that all the necessary loan documents, as per the guidelines, contained in the booklet on loan documentation and various Head office circulars and circular letters issued from time to time, in respect of the above advance have been obtained and the said documents have been duly filled up in all respects and appropriately stamped and executed in my presence and that they are in order. I/We further confirm that all the conditions stipulated in the sanction letter are duly complied with”.As per the aforementioned confirmation Branch Manager should sign and ensure obtaining and execution of duly filled and stamped loan documents in their presence and that they are in order and conditions stipulated in sanction letters are complied with in accordance with guidelines in booklet as loan documentation, Head office circulars and circular letters from time to time. Branch Manager as well as Officers and Assistant

Branch Manager should sign at the end.

xxiii) When Ex.P.138/Doc.54 with the aforementioned confirmation is admittedly signed by A.1 he cannot contend that he simply signed the same without having any knowledge when the certification ensures compliance of all guidelines and circulars then in force.

56C.C.49/2010/Prl. CBI

Court/VSP xxiv) Further as mentioned supra, Ex.P.40 Credit Appraisal in column

No.3 mentions observations and recommendations of the Appraising officer with the handwriting of A.1 stating that applicant is a builder and financier and he is credit worthy and honest and loan of

Rs.6,50,000/- can be sanctioned which is repayable in 15 years commencing from January 5th.

xxv)Further, loan is sanctioned as per Ex.P.140 on 13.7.2004. Though

When the purpose is admittedly for purchase of Flat under construction as per Ex.P.149 three pay orders are dated 13.7.2004, 22.7.2004 and 11.8.2004. Out of the loan amount of Rs.6,50,000/- Ex.P.149 pay order shows that on the date of sanction itself Rs.2,75,000/- pay order was issued and within ten days thereafter another Pay order was issued for

Rs.2,75,000/- on 22.7.2004 and about twenty days after the sanction i.e., on 11.8.2004 another pay order for Rs.75,000/- was issued. Hence, out of the loan amount of Rs.6,50,000/- major amount of Rs.5,50,000/- was disbursed within ten days of the sanction of loan and the remaining amount of Rs.75,000/- was also given in short duration though the housing loan guidelines stipulates Inspection of property and release of amounts stage wise according to the progress of construction and utilization of earlier amount.

xvi)Ex.P.148 pre and post sanction inspection shows the date of inspection of property by A.1 was on 2.2.2005 which is much subsequent to the release of Ex.P.149 Pay orders though it must be prior to that.

xvii)In the light of this involvement of A.1 in this loan is quite obvious though it was sanctioned by P.W.3. Hence, prosecution has proved 57C.C.49/2010/Prl. CBI

Court/VSP beyond doubt conspiracy and cheating as alleged against A.1, A.6 and

A.12.

29.LOAN OF A.8 :

i)The case of prosecution in respect of this loan is as follows:

1)A.8 fraudulently applied for loan of Rs.9 lakhs on 18.6.2004 to purchase flat from A.4 and submitted the copies of link documents of the property, sale agreement, construction agreement, fabricated copies of IT returns for sanction of loan;

2)A.1 without verification of IT returns, collection of margin money dishonestly sanctioned Rs.9 lakhs to A.8 for purchase of Flat No.105 in second floor, Ekarudradevi Towers, Patamata, Vijayawada and credited the loan amount to the SB account of A.4 before receiving the sale deed;

3)A.4 having received the sale proceeds fraudulently created fake sale deed in favour of A.8 and submitted the same to Bank in conspiracy with A.8 and A.1 and subsequently A.4 submitted fake E.C., to A.1 and fraud came to light when A.4 executed genuine sale deed in favour of A.8.

ii)The defence of A.8 is after realizing the fraud played by A.4, he obtained genuine registered sale deed from A.4 and deposited the same in bank and thereafter bank has auctioned the flat recovered the amount from auction purchaser and in fact he incurred loss since entire loan amount was paid to A.4.

58C.C.49/2010/Prl. CBI

Court/VSP iii)Undisputedly this loan is sanctioned by A.1. The loan file of A.8 shows Ex.P.7 alleged fabricated sale deed dated 28.6.2004 executed by A.4 in favour of A.8. According to the recitals of this document flat was sold for Rs.6,20,000/- and out of the said amount, Rs.70,000/- was paid as advance and the remaining amount of RS.5,50,000/- was paid by way of cheque of Vijaya Bank dated 28.6.2004 and property is described as 'flat under construction'.

iv)Ex.P.52 home loan application of A.8 mentions A.9 as guarantor.

Ex.P.55 is agreement of sale allegedly executed by A.4 in favour of A.8.

Ex.P.57 is construction agreement between A.4 and A.8. Ex.P.28 is the credit appraisal form containing personal evaluation, technical and legal evaluation and details of property including valuation, financial evaluation and details of guarantor and his property and recommendations of aprpraising officer and certification of the sanctioning authority. This is crucial document in all respects in housing loans. This admittedly contains handwriting and signature of

A.1 positively recommending sanction of Rs.9 lakhs of loan. Exs.P.53 and P.54 contains Income Tax returns of A.8 and guarantor Ex.P.68 is

NIL EC with one entry in respect of Ex.P.7 sale deed. Ex.P.60 is certificate in respect of the borrower/guarantor, details of property, legal advice of approved panel and Valuation of approved valuer. It clearly mentions that A.1 visited the property on 26.6.2004 which is two days prior to the Ex.P.7 sale deed and signed on the same. Ex.P.62 memorandum of deposit of title deeds also contains signature of A.1.

Ex.P.63 which is certificate of loan papers obtained/Doc.54 also contains signature of A.1. Ex.P.65 is the sanction letter dated 59C.C.49/2010/Prl. CBI

Court/VSP 28.6.2004. Ex.P.69 letter requesting to release instalments contains permission for release signed by A.1. Out of two pay orders under

Ex.P.70, one Pay order is dated 28.6.2004 which is same as the date of

Ex.P.7 and sanction of loan under Ex.P.65 and other pay order is dated 6.7.2004 which is one week after sanction of loan. Out of Rs.9 lakhs

of loan, under pay order dated 28.6.2004 substantial amount

of Rs.5,50,000/- was paid and through the second pay order which is in short duration of one week of time Rs.3,50,000/- was paid.

v)Even in this loan though the purpose of loan is to purchase a flat under construction and according to the manual of instructions stage wise instalments should be released depending upon the progress of the flat and utility of the amount to be ensured the very pay orders under Ex.P.70 shows release of the entire amount within short time in utter violation of the said instructions. There are no pre and post sanction inspection reports with regard to this loan file except Ex.P.60 certification which mentions personal visit of the property by A.1 two days prior to the Sale deed.

vi)Further according to the Income Tax Officer P.W.21 the I.T.Rs., under Ex.P.53 are fabricated. According to the testimonies of SROs., who are P.Ws.1 and 2, Ex.P.7 is a fabricated document and Ex.P.68 is fabricated E.C., on the face of it and as such this clearly demonstrates the role played by A.1 in conspiracy.

vii)Even according to A.8 Ex.P.7 is a fabricated document. But his only version is on coming to know about the fabricated sale deed subsequently and submission of the same to the Bank, he questioned

A.4 and obtained regular sale deed under Document No.5022/05 dated 60C.C.49/2010/Prl. CBI

Court/VSP 9.11.2005 and deposited the same in Vijaya Bank and though entire loan amount was paid bank officials conducted auction of this property without following due process of law and recovered the amount from auction purchaser and he incurred loss and neither A.4 nor Bank did not suffered any loss and he was unnecessarily implicated in this case.

viii)The new sale deed obtained by A.8 from A.4 on 9.11.2005 is marked as Ex.D.11. Soon after realizing the fraud played by A.4 since

A.8 himself obtained sale deed afresh and deposited the same in Bank even before registration of FIR and shown his bonafides he did not commit offence as alleged. But the aforementioned evidence proved that A.1 and A.4 (A.4 died) committed offence of criminal conspiracy and cheating as alleged by prosecution.

30.LOANS OF A.9, A10 AND A.11:

i)Common case of prosecution in respect of these loans is as follows:

1)Prosecution contends that A.9 to A.11 fraudulently applied for housing loans of Rs.9 lakhs each to purchase Flat No.109 in third floor,

Flat No.104 in first floor and Flat No.108 respectively in third floor of

Ekarudradevi Towers from A.4 and submitted copies of link documents, sale agreement, construction agreement, fabricated copies of IT for the purpose of loan;

2)A.1 entered into criminal conspiracy with A.4 and in pursuance of the same he directed P.W.3 to sanction these loans stating that he verified the IT returns and A.9 to A.11 have paid margin money in cash to A.4 and accordingly, P.W.3 sanctioned loans to A.9 to A.11 and 61C.C.49/2010/Prl. CBI

Court/VSP credited the loan amount to the SB account of A.4 before receiving the sale deeds; and

3)A.1 though conducted second check of documents with a malafide intention did not get IT returns verified but simply signed in

Doc.54 and A.4 after receiving the sale proceeds created fake sale deeds and submitted the same to Bank in conspiracy with A.9 to A.11 loanees and subsequently submitted fake E.C., to the bank on the said properties and when the said fraud came to light A,4 executed genuine sale deeds in favour of A.9 to A.11.

ii)The defence of A.9 is entire loan amount is disbursed directly to A.4 who executed Ex.P.9 fabricated sale deed in his favour and on coming to know about the same subsequently, he obtained Ex.D.12 genuine sale deed on 9.11.2005 from A.4 and the Flat was subsequently auctioned by the Bank and recovered the amount from auction purchaser and he suffered monetary loss by paying instalments to the Bank though entire amount of loan was given to A.4 and fabricated sale deed was executed in his favour.

iii)The defence of A.10 is since he came to know subsequently about the fabricated sale deed by A.4 in his favour under Ex.P.10 sale deed he obtained fresh and registered sale deed from A.4 and deposited the same in Vijaya Bank and inspite of that Bank conducted auction without following due process of law and unnecessarily implicated A.10 in this case though he suffered monetary loss by paying 23 instalments to Bank.

62C.C.49/2010/Prl. CBI

Court/VSP iv)The defence of A.11 is on knowing about the execution of

Ex.P.11 false and fabricated sale deed executed by A.4 in his favour, he obtained genuine sale deed under Ex.D.13 from A.4 and deposited in

Vijaya Bank to show his bonafides and Bank conducted auction of property and recovered the amount from auction purchaser and he suffered monetary loss by paying instalments to the Bank.

v)A.11 also filed Ex.D.14 mee seva copy of sale certificate.

Exs.D.12 and D.13 are the fresh and genuine registered sale deeds executed by A.4 in favour of A9 and A.11 respectively.

vi)In view of the admission of A.9to A.11 and submission of fresh and genuine sale deeds under Exs.D.12, D.10 and D.13 respectively proving that the earlier documents Exs.P.9 to P.11 are fake and

Exs.P.68, P.84, P.104 and P.123 E.Cs., submitted by A.4 to bank in respect of the said properties of A.9 to A.11 respectively reflecting

Exs.P.7 to P.11 fake sale deeds on NIL E.Cs., are also fabricated, is not necessary. In addition to that fresh documents obtained by A.9 to A.11 from A.4 are of the same date 14.11.2005 and to show their bonafides they were deposited by A.9 to A.11 in Bank and created equitable mortgage over the respective properties. Hence, if really A.8 to A.11 loanees are in conspiracy with A.1 and A.4 they would not have obtained fresh registered sale deeds and substituted them in the place of fabricated sale deeds for creating equitable mortgage even before registration of FIR. The very act of obtaining the fresh deeds and depositing the same in Bank as and when they came to know about the execution of false and fraudulent sale deeds by A.4 leaves no doubt that they do not have any malafide intention. Hence, 63C.C.49/2010/Prl. CBI

Court/VSP submission of fabricated IT returns deliberately by A.9 to A.11 under

Exs.P.37, P.90 and P.110 respectively cannot be believed.

vii)A.9 to A.11 loans were sanctioned by P.W.3/RLO undisputedly. But to analyze the role of A.1 in these loans, it is necessary to focus upon loan documents.

viii)Ex.P.71 is the housing loan application of A.9 showing Y.V. Siva

Ramakrishna/A.10 as guarantor. Ex.P.72 is agreement of sale executed by A.4 builder in favour of A.9. Ex.P.74 is construction agreement executed by A.4 in favour of A.9. Ex.P.9 is fabricated sale deed in favour of A.9 as mentioned supra. Ex.P.84 is the E.C., showing NIL encumbrances as well as the false transaction under Ex.P.9.

ix)The documents signed by A.1 are as follows:

Ex.P.77 is the certificate given by A.7 in his own handwriting with regard to Branch Manager's personal opinion regarding acceptability and value of the property. He mentioned the date of his personal visit to the property as 17.7.2004 and signed therein. Ex.P.79 is memorandum of deposit of title deeds signed by A.1 and A.9. Ex.P.35 is credit appraisal form contains handwriting of A.1 in columns 13 and 14 regarding recommendations and certification of sanction authority though he did not sign specifically in Branch Manager column at the end. Ex.P.36 is certificate of loan papers/Doc.54 which was signed by

A.1 as Branch Manager and P.W.3 as RLO. Ex.P.85 is the letter requesting to release the loan amount in instalments. It contains signature of A.1 in green ink permitting to release Rs.3 lakhs though the loan of Rs.9 lakhs was sanctioned on 27.7.2004 which is only about 64C.C.49/2010/Prl. CBI

Court/VSP a week prior to the permission for release under Ex.P.85. Ex.P.85 further shows that on the date of loan i.e., 27.7.2004 itself major amount of Rs.5,50,000/- was released though the flat allegedly purchased under Ex.P.9 is under construction. Without releasing the sanctioned amount stage wise entire amount was released in two instalments one on the date of loan and another within one week of the loan in utter violation of circulars and manual of instructions to release the amount stage wise and utility of amount to be ensured.

Ex.P.86 is pre/post sanction inspection report which is admittedly in the handwriting and signature of A.1 mentioning that date of inspection is 10.11.2004 which is about four months after Ex.P.9 sale deed. Ex.P.86 also contains the endorsement of A.1 permitting to release Rs.50,000/- under his signature. Ex.P.37 is photocopies of IT returns of A.9. P.W.3 deposed that A.1 himself used to conduct borrower interview for processing of loan, verification of IT returns and pre sanction inspection of property and he was the supervising officer for housing loans and because she was new to the Job of RLO at that time A.1 used to write appraisal note and process note. She also deposed that pre inspection was also conducted by A.1 in respect of the loan of A.9.

x)The aforementioned oral and documentary evidence clinchingly shows the crucial role played by A.1 in processing, recommending, inspections, release of instalments and signing in crucial documents memorandum and Doc.54 and reflects criminal conspiracy between A.1 and A.4 builder /vendor cheating and causing loss to the Bank.

31.Loan of A.10:

65C.C.49/2010/Prl. CBI

Court/VSP

i)Ex.P.89 is the housing loan application of A.10 for which A.11 is the guarantor. Ex.P.92 is the sale agreement executed by A.4 in favour of A.10. Ex.P.94 is construction agreement executed in favour of A.10 by A.4 and Ex.P.10 is fake sale deed in favour of A.10 executed by A.4 as mentioned supra. Ex.P.104 is NIL EC with one entry reflecting

Ex.P.10 false document bearing No.7563/2004 dated 27.7.2004.

ii)Documents signed by A.1 and contains his handwriting are as follows:

Ex.P.38 credit Appraisal form is totally in the handwriting of A.1 including the columns 12 to 14 regarding recommendations and certification of sanction authority. A.1 positively recommended the sanction of loan. Though A.1 did not sign at the end of the document and only P.W.3 signed as RLO the very positive recommendations in the own handwriting of A.1 goes without saying the active role of A.1 in processing, recommending and sanction. Ex.P.98 is memorandum of deposit of title deeds signed by A.1 as well as borrower. Ex.P.99 is certificate of loan papers of Doc.54 signed by A.1 as well as P.W.3.

Ex.P.96 certificate which contains Branch Manager's personal opinion regarding acceptability and value of property in Form No.15 shows his handwriting stating that the Flat of applicant is having marketable title and it can be taken as security. Date of visit of property by A.1 is mentioned as 17.7.2004. Ex.P.105 is letter requesting to release instalments which contains endorsement and signature of A.1 permitting to release the amount of Rs.3 lakhs. It further mentions that out of the loan amount of Rs.9 lakhs, major amount of Rs.5,50,000/- was released on the date of loan itself and Rs.3,00,000/- was released 66C.C.49/2010/Prl. CBI

Court/VSP with in one week from the sanction of loan without ensuring the guidelines issued by Bank to release the mounts depending upon the progress and stage of construction and utility of amount. Ex.P.106 pre/post sanction inspection report is in the handwriting of A.1 and signed by him stating that date of visit was on 10.11.2004. It also contains endorsement and signature of A.1 permitting to release

Rs.50,000/-. Ex.P.108 contains four pay orders for Rs.4,00,000/-,

Rs.1,50,000/-, Rs.3,00,000/- and Rs.50,000/- issued in favour of A.4.

iii)The aforementioned oral and documentary evidence clinchingly shows the crucial role played by A.1 in processing, recommending, inspections and release of instalments and signing in crucial documents i.e., memorandum & Doc.54.

32.Loan of A.11:

i)Ex.P.109 is the housing loan application of A.1 dated 22.7.2004 to purchase Flat under Construction in undivided share of site. Ex.P.11 is the fake sale deed executed by A.4 in favour of A.11 on 27.7.2004.

Ex.P.111 is sale agreement, Ex.P.112 is construction agreement and

Ex.P.123 is E.C., showing NL encumbrance as well as Ex.P.11 fake sale deed dated 27.7.2004 bearing No.7561/04. Ex.P.110 is copies of IT returns of A.11. Ex.P.39 is credit appraisal form which contains the handwriting of A.1 in columns 11 to 14 regarding computation of loan, recommendations and certification in respect of this loan. Though A.1 did not sign in the column of Branch Manager with his own handwriting he made positive recommendations for sanction of loan. It is signed by

P.W.3.

67C.C.49/2010/Prl. CBI

Court/VSP ii)Further, Ex.P.115 is certificate which is in the handwriting and signature of A.1. In Column No.15 regarding Branch Manager's personal opinion about acceptability and value of the property he stated that the property can be taken as 'security' and date of his personal visit is mentioned as 17.7.2004. Ex.P.117 is memorandum of deposit of title deeds signed by A.1 and the borrower. Ex.P.118 certificate of loan papers/Doc.54 is signed by A.1 and P.W.3. Ex.P.124 is the request letter to release the loan instalments which contains endorsement and handwriting of A.1 permitting release of

Rs.3,00,000/-. It further mentions that out of the loan amount of Rs.9 lakhs, major amount of Rs.5,50,000/- was released on the date of loan itself and Rs.3,00,000/- was released with in one week from the sanction of loan without ensuring the guidelines issued by Bank to release the mounts depending upon the progress and stage of construction and utility of amount. Ex.P.125 is pre/post sanction inspection report in the handwriting of A.1 and signed by him stating that date of visit was on 10.11.2004. It also contains endorsement and signature of A.1 permitting to release Rs.50,000/-. Ex.P.138 contains four pay orders for Rs.4,00,000/-, Rs.1,50,000/-, Rs.3,00,000/- and

Rs.50,000/- issued in favour of A.4.

iii)The aforementioned oral and documentary evidence clinchingly shows the crucial role played by A.1 in processing, recommending, inspections and release of instalments and signing in crucial documents memorandum and Doc.54 in conspiring with A.4.

68C.C.49/2010/Prl. CBI

Court/VSP iv)In the light of this, prosecution proved beyond doubt criminal conspiracy between A.1 and A.4, cheating and causing loss to the Bank in the loans of A.9 to A.11.

33.LOAN OF A.13:

i)Case of prosecution is as follows:

1)A.13 fraudulently applied for a loan of Rs.6.5 lakhs on 25.7.2004 to purchase Flat No.2, Second floor, Sridevi Manikanta Nivas, Devi

Nagar and submitted sale agreement, construction agreement signed by A.7/Builder and fabricated IT returns to the Bank;

2)A.1 entered into criminal conspiracy with A.13 and directed P.W.3 to sanction loan to A.13 and in pursuance of the said direction loan was sanctioned without collecting margin money, verifying IT returns before receiving the original sale deed and A.1 delivered pay orders to A.6 instead of disbursing the same to S. Subba Reddy;

3)A.1 dishonestly did second check of documents, verified the same and signed in Doc.54 and accepted fake sale deeds and did not obtain further legal opinion and E.C., and accepted fabricated E.C., submitted by loanees; and

4)It is revealed that A.13 availed housing loan against the property of Sri R.V.S. Srikanth who is actual owner of the property under

Doc.No.7925/05 against which loan was sanctioned to A.13 and the said dishonest acts of A.1 in conspiracy with A.13 by abusing his official position as public servant caused wrongful loss to the Bank and corresponding wrongful gain to A.13.

69C.C.49/2010/Prl. CBI

Court/VSP ii)Ex.P.12 is alleged fake sale deed dated 31.7.2004 bearing

Doc.No.10373 of 2004 executed by S. Subba Reddy (A.7) and S. Sridevi in favour of A.13 for purchase of Flat No.2, Second floor, Sridevi

Manikanta Nivas, Devi Nagar. Ex.P.152 is sale agreement and P.153 is construction agreement in that connection. Ex.P.164 is E.C., with NIL encumbrances as well as one transaction under document

No.10373/23005 i.e., Ex.P.12 alleged fake sale deed. Housing loan application of A.3 is Ex.P.150. It shows that A.21 is the guarantor for

A.13. Ex.P.27 SB account opening form of A.13 shows that this account holder was introduced by A.6 by clearly mentioning that he got acquaintance with A.13. A.1 signed at introduction portion and also in first page of the application at photo of A.13 with printed certification that A.13 signed in his presence. Ex.P.41 Credit Appraisal

Form shows that columns 12 to 14 which are in respect of computation of loan, recommendations and certification of sanction authority are in the handwriting of A.1 and he made positive recommendations for sanction of loan though he did not sign at the column of Branch

Manager and P.W.3 alone signed at the end on the left side of last page of Ex.P.41.Ex.P.150 housing loan application of A.13 shows that guarantor is A.21. Ex.P.157 certificate is signed by A.1 at the end by clearly mentioning that he visited the property on 31.7.2004 which is the date of Ex.P.12 sale deed. Ex.P.157 contains information with regard to whether valuation is done by approved valuer of the Bank and whether legal opinion is given by approved legal advisor and if so the date of report and Branch Manager's personal opinion regarding acceptability and value of the property offered as security. Ex.P.159 is memorandum of deposit of title deeds signed by A.1 and A.13.

70C.C.49/2010/Prl. CBI

Court/VSP

Ex.P.160 certificate of loan papers obtained/Doc.54 was signed by A.1 as well as P.W.3.

iii)Ex.P.165 letter requesting to release instalments by A.13 clearly shows the endorsement and signature of A.1 permitting to release

Rs.3,50,000/- on 11.8.2004 which is about ten days after sanctioning of loan. Ex.P.167 is pre/post sanction inspection report in the handwriting and signature of A.1 mentioning the date of inspection as 2.2.05. It also contains endorsement and signature of A.1 permitting to release

Rs.25,000/-. Ex.P.168 contains three pay orders for the amount of

Rs.2,75,000/- dated 31.7.2004 which is the date of sanction of loan, for

Rs.3,50,000/- dated 11.8.2004 and for Rs.25,000/- dated 4.2.2005.

The second pay order which is for substantial amount of

Rs.3,50,000/- is only ten days after sanction of loan. Out of the loan amount of Rs.6.5 lakhs, 90% i.e., Rs.6,25,000/- was disbursed within 10 days after sanction of loan. All the three pay orders contain the clearing stamp of Swasakthi Mercantile Cooperative Urban Bank Ltd.,

Vijayawada. Date of visit to the property by A.1 under Ex.P.167 is 2.2.05 which is subsequent to the first two pay orders under Ex.P.168 for Rs.2,75,000/- and Rs.3,50,000/-. Ex.P.151 is the attested copy of

ITRs., of A.13.

iv)P.W.16/ Nayantara, Income Tax Officer, clearly deposed that IT returns submitted by A.13 are fabricated and fake. Further, P.Ws.1 and 2 SROs., clearly deposed that Ex.P.12 sale deed and Ex.P.164 EC are fake and fabricated. Active involvement of A.1 in getting sanction of this loan through P.W.3 is quite evident from the fact that the important columns of credit appraisal form in respect of 71C.C.49/2010/Prl. CBI

Court/VSP positiive recommendations, computation of loan and certificate are in the handwriting of A.1 though he did not sign and Ex.P.167 certificate shows that A.1 himself got mentioned the details about valuation of

Appproved Panel Advocate in this loan in addition to the personal visit

dated 2.2.2005 and as per Ex.P.167 A.1 permitted the release of

Rs.25,000/- and Rs.3,50,000/- and the major amount of Rs.3,50,000/- was disbursed only within ten days after sanction of loan without ensuring the stage & progress of construction & utility of amount and sanction of loan and registered alleged fake sale deed, memorandum of deposit of title deeds and certificate of loan papers/Doc.54 signed by

A.1 are of same date. Even regarding the attested copies of IT returns which are not genuine according to Income Tax Officer/ Nayantara were accepted and obtained without any protest and it appears that

hurriedly entire process was done without ensuring the

lending discipline and proper verification on the ground that P.W.3 was new to the job at that time, as deposed by her. Without criminal conspiracy and fraudulent intention of cheating theBank these things would not have occurred.

v)With regard to encashment of pay orders, P.W.8/Officer of

Swasakthi Mercantile Cooperative Urban Bank Ltd., deposed that the account holders S. Subba Reddy and S. Sridevi who got account in their bank deposited the three pay orders under Ex.P.168 and encashed the same. She also deposed that Ex.P.298 is account

opening form of A.13 in that Bank. It shows that account

holder was introduced by A.12 and Ex.P.299 is a self cheque of A.13 72C.C.49/2010/Prl. CBI

Court/VSP for Rs.4,98,000/- and Ex.P.300 is account statement of A.13 for the period from 20.3.2005 to 15.2.2006.

vi)In cross examination she clearly mentioned that Vijaya Bank is the payee bank and Swasakthi Bank is collecting Bank for all the cheques mentioned in chief examination including the cheques relating to A.13 and cheques were sent to Vijaya Bank for clearing and all the cheques mentioned in chief examination were cleared. Even P.W.9 who is also Officer in Swasakthi Bank deposed that the three pay orders under Ex.P.168 were purchased by S. Subbareddy (A.7)(FIR accused) and the entire amount covered under these pay orders i.e., Rs.9 lakhs was withdrawn by A.6 vide cheque No.110633 on 11.8.2004 and

Ex.P.300 statement of account of A.13 reflects that on 20.3.2005

Ex.P.246 pay order for Rs.5,00,000/- was purchased by A.13 and on the same date amount of Rs.4,98,000/- was withdrawn by A.13 as per the account statement and Ex.P.304 account statement of A.6 reflects that pay order for Rs.2,75,000/- dated 19.4.2005 was purchased by A.6 and on the same day the said amount was deposited into his account by

A.6 and on the same day an amount of Rs.8,20,000/- was withdrawn by

A.6 and on 3.5.2005 Rs.2,25,000/- was deposited into his account through Pay order by A.6 and on the same day A.6 had withdrawn

Rs.6,22,000/- vide self cheque and on 5.7.2005 A.6 had withdrawn

Rs.21,000/- through self cheque.

vii)P.W.11/P. Yagnanarayana, SRO, Patamata, Vijayawada, deposed that Ex.P.309 is certified copy of sale deed No.4197/02 executed by P.

Nagalakshmi in favour of A.13 which is in respect of Flat No.SF-2,

Second floor, Sri Sheetal Vihar, Balajinagar, Krishnalanka, Patamata, 73C.C.49/2010/Prl. CBI

Court/VSP

Vijayawada. The property covered under Ex.P.309 is same as

Ex.P.12 fake sale deed dated 31.7.2004 bearing document

No.10373/04. If same property is purchased by A.13 in 2002 itself under registered sale deed original of Ex.P.309 there is absolutely no necessity to purchase the same in 2004 under Ex.P.12 and showing the said fake transaction in Ex.P.164 E.C. The said fact itself clearly shows that Ex.P.12 is a fake sale deed. A.13 neither gave any suggestion in that respect nor tried to explain in defence. He did not endeavour to adduce any evidence. There is no contra evidence in this point.

viii)In support of the case of prosecution that A.12 as GPA holder and

S. Subba Reddy (A.7) and S. Sreedevi have sold the property covered under Ex.P.12 to R.V.S. Srikanth and he is the actual owner of property under document No.7925/05, Ex.P.332 attested copy of document

No.7925/05 dated 27.8.2005 was filed. It shows that property under

Ex.P.12 and P.332 is same and it was sold to R.V.S. Sreekanth and according to the recitals, purchaser availed housing loan from IDBI

Bank, Vijayawada and Rs.2,25,000/- was paid through by pay order issued by that Bank.

ix)Inspite of voluminous evidence placed by prosecution that

Ex.P.12 sale deed is fake and fraudulently executed to obtain loan, no contra evidence was placed on record by A.13. Ex.P.309 and P.332 registered sale deeds for the self same flat also expose the falsity of

Ex.P.12 sale deed.

x)The aforementioned unimpeachable evidence proves beyond doubt the offence of criminal conspiracy, cheating against A.1, A.12 and A.13 and causing loss to the Bank.

74C.C.49/2010/Prl. CBI

Court/VSP

33.JOINT LOAN OF A.14 AND A.15:

i)The case of prosecution in respect of this loan is as follows:

1)A.15 is husband of A.14 and they have jointly applied for housing loan of Rs.9,00,000/- fraudulently to purchase Flat No.1, Second floor, I building, M/s.Sri Venkateswara Estates, Challapalli Bungalow,

Vijayawada, from A.5 Managing Partner of M/s.Sri Venkateswara

Estates H-Partnership Firm and submitted false sale agreement, construction agreement, purportedly signed by A.5/Managing Partner of M/s. M/s.Sri Venkateswara Estates H-Block Partnership Firm which owned the said flat;

2)A.5 knowing fully well that he had already sold the said property to Smt.Dodda Sunitha on 26.2.2003 conspired with A.14 and A.15 and created false agreement on 15.6.2004 for availing housing loan from

Vijaya Bank;

3)A.1 dishonestly without verifying the ownership of Flat, IT returns of the borrowers dishonestly sanctioned the loan and disbursed the amount without receiving the sale deed and the loanees who got the same fraudulently encashed through A.12;

4)A.12 fraudulently opened an account in the name of M/s. M/s.Sri

Venkateswara Estates H-Block Partnership Firm in M/s. Swasakthi

Mercantile Cooperative Bank and deposited the Demand Drafts obtained from A.1 and withdrawn the amount and distributed the proceeds amongst A.15, A.1 and himself and handed over fake sale deed to A.15 who submitted the same to A.1; 75C.C.49/2010/Prl. CBI

Court/VSP

5)Without obtaining legal opinion on the said fake sale deed, A.1 accepted fabricated E.C., subsequently submitted by A.12 and after withdrawal of the loan amount fraudulently A.12 closed the said account; and

6)By all the aforementioned dishonest acts of A.1 in criminal conspiracy with A.12, A.14 and A.15 caused loss of Rs.9 lakhs to the

Bank and corresponding wrongful gain to the loanees.

ii)Common defence of A.1, A.12, A.14 and A.15 is they are innocent.

iii)Specific defence of A.14 and A.15 is that they were cheated by A.12 and A.5 and they did not receive single pie towards loan and they neither submitted fake documents nor entered into any agreement with A.5 and no notices were issued to them by Bank.

iv)Whereas the defence of A.5 is he did not execute agreement or sale deed in favour of A.14 and A.15 and photo affixed on the sale deed is not that of him and the said sale deed and agreement of sale are fabricated by A.12, A.14 and A.15.

v)The defence of A.12 is as GPA holder of M/s. Venkateswara

Estates he opened current account in M/s.Swasakthi Mercantile

Cooperative Urban Bank Ltd., by submitting required documents and he is no way concerned with the sale transaction pertaining to A.14 and A.15 and he neither cheated A.14 nor executed sale deed in her favour.

vi)A.1 himself sanctioned this loan admittedly.

76C.C.49/2010/Prl. CBI

Court/VSP vii)In the light of the aforementioned rival contentions, a careful scrutiny of joint loan file of A.14 and A.15 shows the following documents.

viii)Ex.P.13 is the alleged fake sale deed in favour of A.14 executed by A.5 as Managing Partner of Sri Venkateswara Estates H-Partnership

Firm dated 5.10.2004 bearing No.1913/2004 on the file of SRO,

Patamata. Ex.P.171 and P.172 are fake sale agreement and construction agreement between A.5, A.14 and A.15. Ex.P.185 is the alleged fake E.C., with NIL encumbrance as well as one transaction with document No.1913/04 i.e., Ex.P.13. Ex.P.169 is joint housing loan application for purchase of Flat No.1, Second floor, I building, M/s.Sri

Venkateswara Estates, Challapalli Bungalow, Vijayawada. One Katta

Ramadevi is the guarantor. Ex.P.25 is the joint account opening form of

A.14 and A.15. At Page No.2 of Ex.P.25, A.12 signed as introducer of account holders by mentioning his account number as 17749. A.1 signed under the column of introduction with his signature and also in first page of the account opening form at photos of A.14 and A.15.

Ex.P.33 is the credit Appraisal Form signed by A.1. Form Nos.13 and 14 contains positive recommendations of A.1 for grant of loan. Ex.P.170 is attested copy of IT returns of A.14. Ex.P.171 is attested copy of IT returns of A.15.

ix)Ex.P.177 is certificate signed by A.1. In column No.15 in respect of personal opinion of Branch Manager regarding acceptability and value of the property, A.1 mentioned that 'property given under the document can be accepted'. Date of personal visit of property by A.1 is mentioned as 26.8.2004. Ex.P.177 also contains pre and post 77C.C.49/2010/Prl. CBI

Court/VSP sanction inspection report of A.1 which also mentions the date of personal inspection of property by A.1 as 26.8.2004. Ex.P.182 is sanction letter dated 5.10.04 signed by A.1. Date of visit of property is about one month ten days prior to sanction of loan. Further, the date of Ex.P.13 sale deed, Ex.P.179 memorandum of deposit of title deeds and Ex.P.180/certificate of loan papers obtained/Doc.54 which contains the signature of A.1 is same as date of sanction of loan on 5.10.2004.

Further Ex.P.184 which is construction report issued by Panel Valuer also contains the signature of A.1 with endorsement to release

Rs.1,00,000/- out of loan amount. Ex.P.186 pre/post sanction report signed by A.1 contains date of personal inspection of property by him

as 9.11.2004. Ex.P.188 contains two pay orders. Out of them pay order

dated 5.10.2004 is for major amount of Rs.8 lakhs out of Rs.9 lakhs of

loan. That shows that on the date of sanction itself, out of nine lakhs eight lakhs pay order was issued to Sri Venkateswara Estates H-Block

Firm. The second pay order under Ex.P.188 is dated 9.11.2004 which is one month after the sanction of loan for the remaining amount of

Rs.1,00,000/-. Both pay orders contain clearing stamp of Swasakthi

Mercantile Cooperative Urban Bank Ltd.

x)Learned counsel for A.14 and A.15 canvassed that material on record do not show any incriminating evidence against A.14 and A.15 and they neither visited the Bank nor submitted loan application with fake documents in conspiracy with A.5 and A.12 for availing the loan proceeds.

78C.C.49/2010/Prl. CBI

Court/VSP xi)In this connection, the Learned Counsel for A.14 and A.15 focussed upon the following admissions made of P.W.5, P.W.21 and

P.W.22:

P.W.5 admits as follows in cross examination:

“It is true that I have no personal knowledge about the documents (Ex.P.169 to P.188) marked in respect of joint housing loan of A.14 and A.15. It is true that I have not personally seen

A.14 and A.15 executing the loan documents. It is also true that

I am not personally aware whether signatures in the said loan documents are that of A.14 and A.15.” “I do not remember whether I issued any demand notices to

A.14, 15 and A.17 and whether they acknowledged the notices and personally came to the bank during my tenure. It is true that CBI did not show me any such correspondence during my examination. I visited the addresses of A.14, A.15 and A.17 along with our Bank investigation officer during internal investigation of the fraud. I did not handover the said record to

CBI. Witness adds it is confidential record. I did not collect any letter or any statements from the loanees about availment of loan during internal investigation.” xii)Regarding the alleged fake IT returns under Ex.P.170 and in cross examination for A.14 and A.15, P.W.21/ITO deposed as follows:

“It is true that I cannot say who personally came to our office and filed Ex.P.170 IT returns of A.14.” xiii)Learned counsel for A.14 and A.15 would submit that even in respect of IT returns of A.15 also, P.W.21 did not depose anything in chief examination.

P.W.22/IO admits as follows in cross examination:

79C.C.49/2010/Prl. CBI

Court/VSP “It is true that I have not obtained the specimen signatures of

A.14/Ch. Rani, A.15/Srinivas and A.17/Naga Vittal. It is true that none of the bank witnesses did not state before me that A.14,

A.15 and A.17 have visited the bank and signed in loan documents and that they themselves came and presented the documents. It is true that A.17 did not receive the loan proceeds. It is true that A.14 and A.15 also did not receive the loan proceeds. It is true that I have not collected any notice or letter to A.14 and A.15 after the loan became NPA. It is not true to suggest that instead of taking A.14, A.15 and A.17 as witnesses, unnecessarily I have arrayed them as accused and that they are innocents.” xiv)Learned counsel for A.1 vehemently argued that even according to the admission of P.W.5/Asst. Manager, Vijaya Bank, Eluru Road

Branch, during the relevant time one Subba Rao was Manager (Credit) during the relevant point of time and he looks after from the time of taking loan application till recovery of loan and the loans of A.8, A.14,

A.15 and A.17 were processed by the said Subba Rao who is no more and Certificate of Loan papers/Doc.54 in respect of loan of A.8 i.e.,

Ex.P.63, in respect of joint loan of A.14 and A.15 ie., Ex.P.180 and in respect of loan of A.17 i.e., Ex.P.226 were signed by the said Subba Rao and A.1 and after obtaining all the documents including Doc.54 and after verifying them Manager (Credit) should place them before the

Branch Manager for obtaining signatures.

xv)Learned counsel for A.1 further canvassed that Exs.P.63, P.180 and P.226 clinchingly shows that equitable mortgage of title deed was obtained by the then Credit Manager Subba Rao and collection of registered documents by Branch officials personally from Sub Registrar offices after registration has come into effect by Circular No.178/2005 80C.C.49/2010/Prl. CBI

Court/VSP

dated 3.10.2005 and Regional Office alone is competent to point out

any deviations, irregularities and illegalities in sanction and disbursal of loans and as per Circular 56/05 dated 4.4.2005 the procedure of

Panel Advocate going to Sub Registrar Offices for search and obtaining of certified copies and E.Cs., and submission of Search report to the

Bank came into force and the job of verification of genuineness of title deeds mortgaged to Bank was entrusted to the Advocates only through Circular127/05 dated 8.7.2005 and when prosecution miserably failed to prove the role of A.1 as alleged and none of the witnesses of Vijaya Bank deposed as to specific overt acts done by A.1 in respect of these eleven loans A.1 cannot be said to have committed offence alleged merely because the date of sanction of loan, disbursement and collection of original sale is same.

xvi)P.W.7/S. Narasimhulu who worked during the relevant time in

Regional Office, Vijaya Bank, Vijayawada, deposed in cross examination that as per Circular 42/05 verification of IT returns and salary certificate came into effect from 15.3.2005 and prior to that there was no such requirement of verification of IT returns and salary certificates produced by borrowers and guarantors. He denied the suggestion that through Circular 56/05 dated 4.4.2005 only verification of sale deeds by the Advocates at Sub Registrar Officers came into force and by the date of sanction of loans in this case there was no rule of verifying the sale deeds submitted by the parties after registration. Though prosecution did not produce any document to show the periodical inspection of the loan documents, if any, made by Regional office pointing out any irregularities in respect of these loans and that 81C.C.49/2010/Prl. CBI

Court/VSP doesn't mean that the procedures admitted by A.1 or correct and there are no irregularities in these eleven loans.

xvii)Further, though learned counsel for A.1 focussed much upon the admission of P.W.5 that the then Manager (Credit) was Subbarao and he looked after everything from the time of taking loan application till recovery of loan and even Doc.54 was also prepared by him he prepares everything and simply obtained the signature of A.1 and loan documents in all the loans in this case shows the signatures of the said

Subba Rao no more only in some of the documents relating to the loans of A.8, A.17 and joint loan of A.14 and A.15 which were admittedly sanctioned by A.1 there are signatures of late Subba Rao.

The very absence of his signatures and process notes in respect of the remaining eight loan files clearly shows that even the said Subba Rao also did not lay his hands on them.

xviii) As mentioned supra P.W.3 who sanctioned five loans upon the instructions of A.1 according to her specifically deposed that A.1 himself used to conduct borrower interview in addition to the processing of loan, verification of loan, pre sanction inspection of property, writing appraisal note, process note and keeping liasonly panel Advocates and Approved valuers.

34.ALLEGED ROLE OF A.5 IN FABRICATING Ex.P.13 SALE DEED

IN FAVOUR OF A.14 AND A.15:

Learned counsel for A.5 canvassed that the Flat sold to Dodda

Sunitha is different from the alleged flat sold to A.14 and A.15 and except the said sale prosecution did not allege any overtacts against 82C.C.49/2010/Prl. CBI

Court/VSP

A.5 and the very affixing of photograph of different person in Ex.P.13 itself rules out the role of A.5 in execution or fabrication of the sale deed Ex.P.13 and prosecution miserably failed to prove the role of A.5 in this.

35.OVERTACTS OF A.5 ACCORDING TO CHARGE SHEET:

i)In page No.36 of charge sheet it is averred that “A.5 knowing fully well that he already sold the property to Dodda Sunitha on 26.2.2003 conspired with A.14 and A.15 and created false agreement with them to sell the property for the sake of availing housing loan from Vijaya Bank by A.14 and A.15. Again in page no.37 of the charge sheet it is averred that, “A.14 and A.15 availed housing loan fraudulently on the property belonging to Smt.Dodda Sunitha, owner of

Flat No.1, Second floor, I building, M/s.Sri Venkateswara Estates ,

Challapalli bungalow having purchased the same from A.5 under sale deed No.562/03 dated 26.2.2003”.

ii)At this juncture, we shall now scrutinize Ex.P.13 registered sale deed in favour of A.14 and Ex.P.308 copy of registered sale deed in favour of Smt.Dodda Sunitha, to ascertain whether property covered under both documents is same. As per schedule portion of Ex.P.308 sale deed in favour of Smt.Dodda Sunitha, Flat Number is 6 in second floor. Whereas flat Number is '1' but not '6' in Ex.P.13. Hence, it is crystal clear that property sold to Dodda Sunitha under the orginal of

Ex.P.308 is different from the property covered under Ex.P.13 and as such, the case of prosecution that deliberately A.5 sold the property which was already sold to Dodda Sunitha is proved to be false.

83C.C.49/2010/Prl. CBI

Court/VSP

36.ADMISSION OF P.W.22/IO:

i)In addition to this P.W.22/IO categorically admits that he was under the impression that A.5 sold the same Flat to A.14 and A.15 and as such he initiated prosecution against A.5 and as per the recitals of

Ex.P.308 Flat Number of Dodda Sunitha is 6 in second floor but not Flat number 1 in second floor as mentioned in Ex.P.13.

ii)Turning to Ex.P.172 the alleged fabricated sale agreement, property is described at page 3 as Flat in 3rd floor whereas in schedule portion at page No.4 flat number is mentioned as '1' in second floor. In

Ex.P.13 schedule portion as mentioned supra Flat Number is mentioned as '1' in second floor. Hence, there is discrepancy with regard to crucial aspect of floor in which property located in agreement and sale deed.

iii)It is the further defence of A.5 that A.14 purchased Flat No.1 in second floor (i.e. flat under Ex.P.13) under registered document

No.1913/03 under the original of Ex.D.4 and as such purchase of same flat again in the year 2004 under document No.1913/04 does not arise and that itself shows that A.14 and A.15 have forged and fabricated

Ex.P.172 sale agreement, Ex.P.13 registered sale deed for wrongful gain.

iv)In view of this defence, Ex.D.4 is an important document.

Ex.D.4 shows that it is a registered sale deed bearing document

No.1913/03 dated 22.7.03 and it was executed by Venkateswara

Estates H firm represented by A.5 in favour of A.14. According to schedule of this document premises to the North of Flat Nos.1 and 2 in 84C.C.49/2010/Prl. CBI

Court/VSP second floor, I block was sold with plinth area of 250 sq.feet. Whereas as per schedule in Ex.P.13 property sold is Flat No.1 with plinth area of 900 sq.feet, semi finished flat which is to the west of the corridor in second floor, I block. Hence property under Exs.P.13 and D.4 is not same as contended by A.5.

37.REGISTRATION IN DIFFERENT SUB REGISTRAR OFFICES:

i)Yet another irregularity pointed out by learned counsel for A.5 is, though property covered under Ex.P.13 and Ex.D.4 is in second floor of the same Apartment and comes under the jurisdiction of Gunadala

SRO and when original of Ex.D.4 was registered on the file of Gunadala

SRO in 2003 deliberately Ex.P.13 was registered on the file of Patamata

SRO for the sake of fabcrication of the sale deed.

ii)In the light of this, a simple glance at Ex.P.13 and Ex.D.4 shows that though the property covered under both documents is in second floor of the same Apartment. Ex.D.4 was registered on the file of

Gunadala SRO & Ex.P.13 shows the endorsement Patamata SRO.

iii)For better appreciation of the facts in this connection, it is necessary to go through the averments in Ex.D.8 which is the true copy of O.A.86/2007 filed by Vijaya Bank against A.14, A.15 and their guarantor Katta Ramadevi. In para G it is clearly averred that, “Bank came to know that SBI, Prajasakthi Nagar, Vijayawada, was trying to sell the property mortgaged to Viajya Bank by issuing auction notice

dated 1.2.2006 published in Hindu and Eenadu daily news papers and

on suspecting fraud played by A.14 and A.15 herein, immediately

Vijaya Bank addressed letter dated 2.2.206 to SBI, Prajasakthi nagar 85C.C.49/2010/Prl. CBI

Court/VSP

Branch, informing the particulars of mortgage created in favour of

Vijaya Bank on same property in this case and advised the said branch that the sale by auction will be subject to mortgage created to Vijaya

Bank and requested to remit the amount realized by sale to Vijaya

Bank and inspite of the same they have sold the property in public auction and appropriated the entire sale proceeds towards their dues and as such by giving legal demand notice the present OA was filed in the absence of response from A.14 and A.15. In para I of the said O.A., it is further averred that, “on 13.5.20067 when bank verified with

Patamata SRO, they found the alleged sale deed in document

No.18913/-04 (Ex.P.13 herein) alleged to be registered with

Patamata SRO deposited in Vijaya Bank towards security was

not registered in Patamata SRO and the alleged flat is in

Prakasam Road, Governorpet,Vijayawada, which is not under

the jurisdiction of Patamata SRO and as such Patamata SRO could not issue the EC and search report and alleged sale deed is a fake document.

iv)As mentioned in detail in that O.A.. P.W.10/P.V.V.Durga Prasad who worked as SRO, Gunadala from November, 2007 to April, 2004 deposed clearly in chief examination that Ex.P.13 document consists of endorsement of SRO Patamata though Prakasam road, Governorpet,

Vijayawada, wherein the property covered under Ex.P.13 is located comes under the jurisdiction of SRO, Gunadala. There is absolutely no denial regarding the fact that property covered under Ex.P.13 in fact comes under the jurisdiction of SRO, Gunadala but not SRO, Patamata, 86C.C.49/2010/Prl. CBI

Court/VSP which allegedly registered Ex.P.13 document by way of giving suggestion.

v)That itself shows the fraud played upon the Bank by A.14 and

A.15. Further P.W.10 also deposed that only rubber seal was affixed in

Ex.P.13 though metal seal will be used in Sub Registrar offices. Hence, by the said rubber seal and the alleged registration of Ex.P.13 in SRO,

Patamata instead of SRO, Gunadala where property is situated, P.W.10 deposed that it is a fake sale deed.

38.FALSE PHOTOGRAPH:

As contended by A.5 photograph of vendor affixed in Ex.P.13 doesn't belong to A.5. Even IO and P.W.5 also admits that photograph affixed in Ex.P.13 is not that of A.5. If really A.5 himself executed

Ex.P.13 he should not have affixed photograph of somebody in his place.

39.FARUDULENT OPENING OF ACCOUNT AND DIVERSION OF

FUNDS & ROLE OF A.12:

i)IO categorically admits that A.12 fraudulently opened an account in the name of M/s.Sri Venkateswara Estates H Block Partnership firm in

M/s.Swasakthi Mercantile Cooperative Urban Bank Ltd., and deposited

Demand drafts obtained from A.1 and A.12 had withdrawn the amount and distributed the proceeds among A.1, A.14, A.15 and himself. A.5 contend that A.12 is no way concerned with Sri Venkateswar Estates and inspite of the same he fraudulently opened the account and closed the same after withdrawing the amount and he is no way concerned with the opening of that account and not received loan amount.

87C.C.49/2010/Prl. CBI

Court/VSP ii)IO categorically admits at page 4 that A.5 has not received single pie from the transaction and A.5 doesn't know about opening of account in the name of Sri Venkateswara Estates by A.12 in

M/s. Swasakthi Mercantile Cooperative Urban Bank Ltd. IO further admits that as per the contents of charge sheet in para 3 of page 39,

name of A.5 is not mentioned with other accused who caused

loss to the Bank and in para 2 at page 35 of charge sheet he mentioned that A.5 has sold the property to Dodda Sunitha on 26.2.2003 and again sold same property to A.14 and A.15 on 15.6.2004 and A.5 was charge sheeted only on the ground that Flat sold to Dodda Sunitha was again sold to A.14 and A.15. Further in respect of Ex.P.346 E.C., he admits as follows:

“It is true that as per Ex.P.346 E.C., filed by me Chadalavada

Srirani (A.14) purchased the property from Sri Venkateswara

Estates, H Block, from A.5 under registered sale deed bearing document No.1913/03 dated 22.7.2003. It is true that as per

Ex.P.346 E.C., SBI executed regsitered document bearing

No.2898/2006 dated 30.8.2006 in favour of Dandibotla Venkta

Rao in respect of Flats 1 and 2 of an extent of 10 sq.yds.,built up area 260 sq.feet., of A.14.” iii)Through P.W.22 only Ex.P.346 E.C., obtained from SRO, Gunadala in respect of property of A.14 was marked. A simple glance at Ex.P.346 reflects Ex.D.4 sale deed bearing No.1913/03 and another registered sale deed dated 30.8.2006 bearing No.2898/06 executed by SBI,

Prajasakthinagar branch, Vijayawada, in favour of Dandibotla

Venkatarao. Ex.D.8 O.A.86/07 which was filed by Vijaya Bank against

A.14 and A.15 herein clearly mentions the sale of mortgaged property in this case by SBI, Prajasakthinagar Branch, Vijayawada.

88C.C.49/2010/Prl. CBI

Court/VSP iv)The aforementioned contents in Ex.D.8 O.A.86/07 and Ex.P.346

E.C., clinchingly shows that same property mortgaged in this case was already mortgaged to SBI, Prajasakthinagar Branch by A.14 and the said Bank sold the same in auction and realized the entire amount in appropriation of loan in that Bank and Ex.P.346 did not reflect Ex.P.13 sale deed bearing No.1913/04. Hence, Ex.P.13 is a fake document not reflected in Ex.P.346 E.C. Leave alone Ex.P.346 E.C., Ex.P.185 E.C., in the loan file of A.14 and A.15 reflects Ex.D.4 document bearing

No.1913/04 only but not Ex.P.13 sale deed though E.C., was obtained for the period till 12.10.04 and Ex.P.13 document is dated 5.10.2004.

Even this fact expose falsity in Ex.P.13 sale deed. Through P.W.22/IO another E.C., with regard to the property of A,.14 was filed.

v)P.W.5 deposed in cross examination clearly that A.14 and A.15 submitted housing loan application and A.5 did not sign in any application submitted by A.14 and A.15. PW.5 categorically

admits that signature of A.5 on Ex.P.308 which is copy of

registered sale deed in favour of Dodda Sunitha doesn't match

with the alleged signatures of A.5 on Exs.P.172 agreement of

sale and P13 sale deed and that they are different and not signed by the same person. As mentioned supra, according to P.W.5 with the admitted signatures of A.5 available in original of Ex.P.308, A.14 and

A.15 forged and fabricated Ex.P.13 sale deed for wrongful gain and all the Sub Registrars who were examined on behalf of prosecution categorically admits that photograph of vendor on Ex.P.13 is not tallied with A.5. Admittedly, A.5 did not avail any pie out of the loan amount sanctioned to A.14 and A.15.

89C.C.49/2010/Prl. CBI

Court/VSP

40.DEFENCE OF ALLEGED GPA IN FAVOUR OF A.12:

i)A.12 contend that A.5 executed GPA in his favour and with that

GPA he opened the account in Swasakthi Mercantile Cooperative Bank.

If really such GPA is executed in favour of A.12, there is absolutely no reason for not producing the said GPA or its copy before the Court.

A.12 further contend that he is no way connected with sale transaction pertaining to A.14 and A.15 and by submitting all the requisite documents, he opened the account as GPA of A.5 and after thorough scrutiny of the documents Bank account was opened.

ii)In this connection, Ex.P.306 account opening form shows that name of account holder is ‘Sri Venkateswara Estates’. In column no.10 regarding introduction, name and address of A.12, his account

No.3001 and phone number are mentioned. Even same address and phone number are mentioned in Column no.8 which is the address of the account holder, ‘Sri Venkateswara Estates’. In Page No.2 regarding specimen signatures column rubber stamp of Venkateswara Estates

Managing Partner is affixed and photo of A.12 was pasted in the column for photo of account holder.

iii)In this connection, P.W.8/T. Padmaja, Officer of Swasakthi

Mercantile Cooperative Urban Bank Ltd., deposed that both Exs.P.305 and P.306 are current account opening forms of Sri Venkateswara

Estates and account holder was introduced by A.12. Ex.P.305 also shows that in specimen signatures and photo column, A.12 photo and rubber stamp of 'for Sri Venkateswara Estates, Managing Partner' are 90C.C.49/2010/Prl. CBI

Court/VSP affixed. P.W.8 further deposed that Ex.P.276 is current account opening form of A.12. In this column No.10 about introduction was left blank. In specimen signatures column, photo of A.12 is affixed.

iv)P.W.8 deposed that the accounts statement of Sri Venkateswara

Estates i.e., Account No.438 shows ten cheques were deposited in that account and they were encashed into that account.

v)Further Ex.P.280 Joint SB account opening form of A.7 (FIR accused) and his wife Sridevi, Ex.P.298 SB account opening form of

Narra Raghu Babu/A.13, Ex.P.301 SB account opening form of A.6 &

Ex.P.305 Current account opening form of Sri Venkateswara Estates represented by Managing Partner A.12 are also introduced by A.12 alone. In Ex.P.305 photo of A.12 was affixed in specimen signatures column and stamp of 'for Sri Venkateswara Estates Managing Partner' was affixed. Hence, Ex.P.306 current account opening form mentions name of account holder in Column No.7 as Sri Venkateswara Estates.

Whether it is represented by anybody is not mentioned. Only in

Ex.P.305 account opening form the account holder name in column no.7 is mentioned as Sri Venkateswara Estates Managing Partner

A.V.V.Narayana Rao/A.12.

vi)In Cross examination for A.12, P.W.8 simply deposed that by following the procedures accounts mentioned by her in chief examination were opened. In cross examination for A.5, she deposed that for opening current account in the name of Partnership firms proofs like ration card, PAN card, photo identity, registration certificate,

Partnership deed and Managing Partner's affidavit would be collected and she doesn't know whether all these documents were taken 91C.C.49/2010/Prl. CBI

Court/VSP

for opening account in the name of Sri Venkateswara Estates

and whether any enquiry was done about existence or

otherwise of Sri Venkatewara Estates before opening the

account. She clearly deposed that accounts will be opened as per the instructions of Chief Executive Officer Sri Y. Chandrasekhara

Rao/P.W.18.

vii)P.W.18/Y. Chandrasekhar Rao deposed that he handed over

Exs.P.273 and under Ex.P.274 he handed over original account opening forms of Ch.V.Nageswara Rao and Ch. Lakshmi Kumari (joint account),

Sri Venkateswara Estates, S.Sridevi and S. Subba Reddy (joint account),

Narra Raghu Babu (A.13) and A.V.V.Narayana Rao (A.12). He identified

A.12 who was present in the Court hall.In cross examiantion for A.5, he deposed as follows:

“If registered firm is the proposed account holder photo copy of firm registration certificate also would be taken. It is true that

Partnership deed also will be taken. I have no idea that affidavits of Managing Partner are also required if proposed account holder is a registered firm. Unless I see the documents I cannot say who are the Partners of Sri Venkateswara Estates. Unless I see the record I cannot say whether any documents were taken at the time of opening the account of Sri Venkateswara Estates. I do not remember on the basis of which documents we confirmed that

A.12 is Managing Partner of Sri Venkateswara Estates. I cannot say now whether Sri Venkateswara Estates was in existence by the date of opening the account.” viii)Hence what documents were obtained at the time of opening the accounts by A.12 are not mentioned by P.W.8 or P.W.18.

ix)PW.9/Md. Aiyaz Officer in Swasakthi Mercantile Cooperative Bank deposed that Ex.P.279 statement of account No.438 of Sri 92C.C.49/2010/Prl. CBI

Court/VSP

Venkateswara Estates reflects the encashment of Exs.P.277 cheque allegedly issued by Managing Partner for Sri Venkateswara Estates in favour of A.12 for Rs.7,96,800/- on 6.10.2004 and Ex.P.278 self cheque of A.12 as, “for Managing Partner of Sri Venkateswara Estates”

Rs.99,000/- dated 9.11.2004 and Ex.P.188 which consists of two Pay

Orders one for Rs.8 lakhs and another for Rs.1 lakh in favour of Sri

Venkateswara Estates in respect of the loan of A.14 and A.15 was purchased as CPP and encashed in Ex.P279 statement of account and

A.12 has withdrawn Rs.7,96,800/- from the said account and also

Rs.99,000/- under self cheque and closed the account on 11.2.2005.

x)In cross examination for A.12 though he simply admits that

Ex.P.279 Statement of Account of Sri Venkateswara Estates and

Ex.P.293 Statement of account of A.7 and S. Sridevi contains handwritings with pencil and he doesn't know who had written the same and he did not write the same, that doesn't mean that the said accounts statements are false. They are computerized account statements which contains the certification of Branch Manager and counter signed by Systems Manager.

xi)P.Ws.8,9 and 18 are the persons connected with Swasakthi

Mercantile Cooperative Bank. In cross examination no suggestion was given by A.12 stating that in pursuance of GPA given to A.12 by Sri

Venkateswara Estates he opened the said accounts in the name of Sri

Venkateswara Estates. As contended by A.5 for the first time only in written statement filed on 16.3.2018 A.12 mentioned that Managing

Partner of Sri Venkateswara Estates executed GPA in his favour and he submitted the documents as GPA holder for opening the account and 93C.C.49/2010/Prl. CBI

Court/VSP submitted all required documents for the same. Even in written statement he did not whisper about date, month or year of the alleged

GPA. If the alleged GPA was in existence by the date of opening accounts he ought to have mentioned the same in the account opening form itself. But the very fact of non mentioning the status of A.12 as

GPA holder in the said account opening forms and non giving suggestions to P.Ws.8,9 and 18 about the same itself speaks about fraudulent opening of the said accounts by A.12 and closing the same after encashment of the amounts. If really it is opened as GPA holder of Managing Partner of Sri Venkateswara Estates, entire amount reflected in the said statement ought to have been withdrawn and utilized by A.5. There is no such allegation of utilizing the said amounts by A.5 either in charge sheet or during the trial including IO and no evidence to that effect in material on record. Hence, the alleged GPA is totally a myth invented to save the skin of A.12 and do not merit even the judicial scrutiny.

xii)On the other hand, the aforementioned documents and oral evidence shows the withdrawal and diversion of huge amounts including the loan amount of A.14 and A.15 by A.12.

xiii)Coming to the joint loan documents of A.14 and A.15, which was admittedly sanctioned by A.1, Ex.P.25 is the Account opening form signed by A.1 in the first page as well as at introduction portion. Interestingly A.12 signed in introduction column That

itself shows that A.12 got knowledge from the time of opening

the joint account of A.14 and A.15 for obtaining this loan.

Ex.P.33 is Credit Appraisal form signed by A.1 with positive 94C.C.49/2010/Prl. CBI

Court/VSP recommendations and certification of sanction authority in columns 12 to 14. Ex.P.169 is the joint loan application of A.14 and A.15. Exs.P.170 and P.171 are the copies of ITRs., of A.14 and A.15. Ex.P.177 is certificate contains signature of A.1. In column No.15 regarding personal opinion about acceptability and value of the property A.1 mentioned that “property can be accepted as security and his personal visit to the property was on 26.8.2004.” Ex.P.177 also contains pre/post sanction inspection report signed by A.1 mentioning his date of visit as 26.8.2004. Ex.P.179 is memorandum of deposit of title deeds signed by A.1 and A.14. Ex.P.180 is certificate of loan papers obtained/Doc.54 signed by A.1as Branch Manager and M.V.Subba Rao. Ex.P.182 is sanctioned letter signed by A.1. Exs.P.13 sale deed, P.180 Doc.54, P.179 memorandum, P.182 sanction letter are of the same date. Ex.P.186 pre/post sanction inspection respect which is in the handwriting and signature of A.1 mentions that the date of his personal visit to the property was on 9.11.2004. In remarks column he mentioned that “building going to be constructed and hence, Rs.1 lakh may be released.” xiv)Ex.P.188 contains Pay order for Rs.8 lakhs which is almost

90% of loan amount of Rs.9 lakhs was issued on the date of

sanction and obtaining of sale deed itself though construction of flat to be completed. The remaining amount of Rs.1 lakh was issued in another pay order dated 9.11.2004 covered under Ex.P.188 one month after sanction of loan. Both pay orders were issued in favour of ‘Sri

Venkateswara Estates H block’ The very obtaining of both pay orders without ensuring the progress of construction and release of total 95C.C.49/2010/Prl. CBI

Court/VSP amount of loan within one month after the sanction without ensuring utility of amount constitutes utter violation of circulars and manual of instructions of the Bank and opening of account by A.12 in the name of Sri Venkateswara Estates, withdrawing of the same as reflected in accounts statement, newly opened by A.12 fraudulently in the status of Managing Partner of Swasakthi Mercantile

Bank by affixing his photo and diverting the funds clearly shows total conspiracy from the beginning of submitting loan application till the end among A.1, A.12, A.14 and A.15 and without criminal conspiracy the aforementioned aspects of submitting false and fake sale deed, agreement, Ex.P.185 E.C., disbursement and diversion of amounts will not be possible.

xv)As per the evidence of Income Tax Officer/Nayanatara, Exs.P.170 and P.171 ITRs., are also false and fabricated. Role of A.1 in this conspiracy and cheating is so patent in sanction and disbursement of loan on the same date of submitting registered document and issuing pay order for Rs.8 lakhs out of Rs.9 lakhs of loan amount without ensuring the stage of construction and obtaining memorandum on the same date of document and sanction. The dates of inspection mentioned in Ex.P.177 by A.1 i.e., 26.8.2004 is much prior to the obtaining of sale deed and another date of personal visit of A.1 under

Ex.P.186 i.e., 9.11.2004 is only four days after Ex.P.13 sale deed and sanction of loan. Why Rs.8 lakhs of loan out of Rs.9 lakhs was given on the date of sanction and obtaining of memorandum is neither explained by A.1 nor suggested to the witnesses.

96C.C.49/2010/Prl. CBI

Court/VSP xvi)Hence, all the aforementioned aspects clinchingly shows criminal conspiracy and cheating of A.1, A.12, A.14 and A.15 and name of A.5 is only utilized by A.12 for the sake of diverting funds to have unlawful gain by A.14, A.15 and A.12 in conspiracy with A.1.

xvii)In view of voluminous direct evidence on record opinion evidence of GEQD Expert that signatures on agreement of sale and sale deed are that of A.5 cannot be taken into consideration. Hence, prosecution miserably failed to prove offence alleged against A.5.

41.LOAN OF A.17:

i)The case of prosecution in respect of this loan as follows:

1)A.17 applied for loan of Rs.16 lakhs on 4.1.2005 to purchase building consisting of ground and first floor at Ramavarappadu from

A.22 and A.1 dishonestly did not obtain original title deed of property from A.22 and obtained only sale agreement executed by A.22 and

Smt.Lakshmi Kumari;

2)In pursuance of conspiracy and A.1 did not verify the IT returns submitted by A.17, A.22 and Lakshmi Kumari but sanctioned loan of

Rs.16 lakhs without receiving the sale deed executed in favour of A.17 and handed over the amount to A.22;

3)A.22 opened bank account in Swasakthi Mercantile Cooperative

Bank Ltd., after receiving the Demand Drafts with the introduction of

A.12 and fraudulently got fake sale deed prepared through A.12 and after receiving money handed over the fake sale deed to A.17 who in turn submitted the same to Bank; and 97C.C.49/2010/Prl. CBI

Court/VSP

4)A.22 gave Rs.10 lakhs to A.12 towards commission for arranging fake sale deed, IT returns and E.C.; and

5)A.1 dishonestly did not go to the Sub Registrar Office to receive the sale deed executed by A.22 in favour of A.17 and not obtained further legal opinion and subsequent E.C., and A.22 is still owner of the property and mortgaged original sale deed in SBH, City Civil Court

Branch, Vijayawada, and availed loan against his own property by mortgaging the same.

ii)The defence of A.17 is he neither approached the Bank nor submitted fake documents and A.22 who is his maternal uncle without his knowledge and consent got the loan amount and he came to know the said fact subsequently and he never signed in the loan documents and A.17 is totally innocent and A.22 took advantage of his innocence and A.17 even lost his career due to this case.

iii)The defence of A.22 is without the knowledge and consent of

A.17 he had given all the loan documents pertaining to A.17 to A.12 who promised to get the loan sanctioned and A.12 managed the loan in the name of A.17 and availed loan proceeds and he had also given a letter to the Bank for one time settlement and A.17 did not sign in any documents.

iv)In page 38 of charge sheet in para 3 regarding the loan of A.17 it is mentioned as follows:

“Sri Cholla Venkata Nageswara Rao (A.22) fraudulently got fake sale deed prepared through Sri A.V.V.Narayana Rao (A.12). Sri

Cholla Venkata Nageswara Rao (A.22) after receiving money handed over fake sale deed to A.17 who inturn submitted the 98C.C.49/2010/Prl. CBI

Court/VSP same to the Bank. A.22 gave Rs.10 lakhs to A.12 towards commission for arranging fake sale deed, fake IT returns, fake sale deed executed by A.22 and fake EC subsequently in respect of the said property.”

42.WHETHER A.17 SUBMITTED THE FAKE DOCUMENT TO THE

BANK AND AVAILED LOAN PROCEEDS AS ALLEGED:

i)In this connection P.W.5/Assistant Manager, Vijaya Bank, deposed about housing loan account of A.17 and got marked Exs.P.216 to P.230 with regard to this loan. P.W.5 never deposed that A.17 personally visited the Bank, submitted the documents personally and availed the loan. Admittedly P.W.5 is not the officer who sanctioned the loan. In cross examination on behalf of A.17, P.W.5 admits as follows:

“It is true that I have no personal knowledge about the documents (Ex.P.217 to P.230) marked in respect of the Housing

Loan account of A.17. It is true that I have not personally seen

A.17 executing the loan documents. It is also true that I am not personally aware whether signatures in the said loan documents are that of A.17.” “I do not remember whether I issued any demand notices to

A.14, A.15 and A.17 and whether they acknowledged the notices and personally came to bank during my tenure. It is true that

CBI did not show me any such correspondence during my examination, I visited the addresses of A.14, A.15 and A.17 along with our Bank investigation officer during internal investigation of the fraud. I did not handover the said record to CBI. Witness adds it is confidential record. I did not collect any letter or any statements from the loanees about availment of loan during internal investigation.” ii)P.W.12/Smt.Rajeswari, RLO deposed that Ex.P.24 is the loan application,Ex.P.217 to P.219 are the IT returns of A.17 and did not 99C.C.49/2010/Prl. CBI

Court/VSP whisper anything against A.17. In cross examination for A.1 P.W.12 deposed that she sanctioned loans as per the rules. She also did not depose that A.17 personally visited the bank and filed the documents.

In fact P.W.12 did not even mention that she identified A.17 in Court.

iii)P.W.21/Income Tax Officer deposed that the alleged IT returns of

A.17 is Ex.P.217. In cross examination she admits as follows:

“It is true that I cannot say who personally came to our office and filed Ex.P.170 IT returns of A.14 and Ex.P.217, IT returns of

A.17. It is true that I cannot say who subscribed the signatures on the said returns.”

P.W.22/IO admits as follows in cross examination for A.14, A.15 and A.17.

“ It is true that I have not obtained the specimen signatures of

A.14/Ch. Rani, A.15/Srinivas and A.17/Naga Vittal. It is true that none of the bank witnesses did not state before me that A.14,

A.15 and A.17 have visited the bank and signed in loan documents and that they themselves came and presented the documents. It is true that A.17 did not receive the loan proceeds. It is true that A.17 is a software engineer. It is true that I did not investigate the details as to whether A.17 was working at the time of availing the loan. I have not collected any records to show that whether bank addressed any notice or letter to A.17 after the loan became NPA. It is true that Ex.P.32 loan account of A.17 shows deposit of Rs.65,000/- on 24.6.2005 and Rs.20,000/- on 28.9.2005. I did not collect the credit vouchers to know who actually made the said payments. It is not true to suggest that instead of taking A.14, A.15 and A.17 as witnesses, unnecessarily I have arrayed them as accused and that they are innocent.” 100C.C.49/2010/Prl. CBI

Court/VSP iv)From the aforementioned testimonies of important witnesses

there is no material before the Court that A.17 visited the

Branch personally and submitted fake documents along with

loan application and subscribed signatures on the documents and availed loan proceeds as mentioned in the charge sheet. Since A.22 admits that he availed the said loan in the name of A.17 who is his nephew without his knowledge and consent with the help of A.12 and he also gave letter to the Bank for one time settlement and P.W.12/RLO who sanctioned loan also did not identify him and IO did not collect his specimen signatures, there is no material on record to show the nexus between A.17 and the offences alleged.

v)In view of this A.17, who according to him neither availed loan nor approached bank but lost his career due to this case, is totally

innocent and prosecution miserably failed to establish any

case against him.

vi)In proof of the allegation at page 38 of charge sheet that A.22 is still the owner of the property and Ex.P.15 sale deed is fake and A.22 mortgaged this property to S.B.H., Civil Courts Branch, Vijayawada, and availed the loan, prosecution examined P.W.13/D.Baba Ramji Natraj,

Assistant Manager in S.B.H., City Civil Courts Complex Branch,

Vijayawada, from 2006 to 2009. He deposed that Ex.P.311 is the mortgage loan application form submitted by A.22 in the said

Branch and eleven lakhs was sanctioned to A.22 against the mortgage of property covered under Ex.P.15 and they also obtained legal opinion

before sanction of the said loan and original sale deed No.1530/88 is in

the custody of his Branch and Ex.P.312 accounts statement of A.22 in 101C.C.49/2010/Prl. CBI

Court/VSP respect of that loan shows the outstanding amount of Rs.7,11,799.66 ps., by 31.1.2008.

vii)Ex.P.311 loan application shows that it is dated 17.9.2004.

Ex.P.15 sale deed is dated 10.1.2005 and Ex.P.220 sale agreement is

dated 30.12.2004. Both documents are much subsequent to

Ex.P.311 application and availing of loan from SBH basing on the mortgage of self same property. Column No.11 of Ex.P.311 which is in respect of property proposed to be mortgaged clearly shows the same property covered under Ex.P.15.

viii)The testimony of P.W.13 in respect of availing loan by

A.22 against the mortgage of self same property under Ex.P.15 and non repayment of the said loan by 31.1.2008 according to Ex.P.312 statement of account remained unchallenged since none cross examined the witness. The aforementioned fact also fortifies the case of prosecution that A.22 is still owner of the property and Ex.P.15 is a fake sale deed.

ix)Turning to the important documents in the loan file of A.17 which throw focus on the involvement of A.1 are as follows:

Ex.P.15 is alleged fake sale deed in favour of A.17 dated 10.1.2005. Ex.P.220 is the sale agreement in favour of A.17 dated 30.12.2004. There is no E.C., in this file. The loan was allegedly availed for purchase of constructed house. Ex.P.24 is account opening form of

A.17. In the second page of Ex.P.24 account opening form in respect of the column witnesses A.12 and A.13 names are mentioned as first and second witnesses. In last page in introduction column A.12 signed 102C.C.49/2010/Prl. CBI

Court/VSP as introducer. A.1 signed in first page to show that proposed account holder signed in his presence. Ex.P.30 is Credit Appraisal form signed by A.1. Columns 13 and 14 shows positive recommendations and certification of the sanction authority. In addition to this at the back of fourth page under column No.12 regarding recommendations there is another signature of A.1 as Branch Manager. Ex.P.31 is the sanction letter dated 10.1.2005 containing the signature of A.1. Ex.P.32 is the

Statement of account of A.17. Ex.P.216 is Housing Loan Application of

A.17. It shows that in column No.H with regard to the two references names of A.6 and A.12 are mentioned. In Column No.I name ofA.22 and A.13 are mentioned as guarantors. Ex.P.217 is the photocopies of

IT returns of A.17. Ex.P.219 is the photocopies of IT returns of A.13.

Ex.P.221 is the receipt issued by A.22 and his wife in token of receiving the alleged amount from A.17 in respect of sale of property.

Ex.P.223 certificate is signed by A.1 stating that he personally visited the property. But date of visit is not mentioned. In column No.15 which is in respect of Branch Manager's personal opinion regarding the acceptability and value of the property, it is clearly mentioned that property offered as security can be accepted. In this column value of property is left blank. Ex.P.225 is the memorandum of deposit of title deeds signed by borrower alone. Column of Signature of

Branch Manager is left blank. Ex.P.226 is certificate of loan papers obtained/Doc.54 which is signed by A.1 as well as officer M.V. Subba

Rao.

x)As mentioned supra there is certification of the persons signed in

Doc.54 to the effect that all the documents were obtained duly filled 103C.C.49/2010/Prl. CBI

Court/VSP executed in their presence and stamped properly by following all the guidelines and circulars and they are in order and conditions in sanction letter are duly complied with. Hence, it cannot be said that

Branch Manager do not have any knowledge and when note was put up and brought to him by the Offier M.V. Subba Rao, he simply signed in the same.

xi)Ex.P.229 is the post sanction inspection report signed by A.1 as well as M.V. Subba Rao. In column No.7 in respect of observations of inspecting official, it is clearly mentioned that building was inspected by both officials on 9.1.2005 which is a day prior to Ex.P.15 sale deed.

Ex.P.230 is pay order dated 10.1.2005 for Rs.16 lakhs which is the entire loan amount.

xii)Ex.P.15 alleged sale deed, Ex.P.230 pay order for entire loan amount of Rs.16 lakhs, Ex.P.226 Doc.54, Ex.P.225 memorandum of deposit of title deeds, Ex.P.31 sanction letter are of the same date 10.1.2005, which shows that hurriedly loan was sanctioned, equitable mortgage of property was obtained and pay order was issued to A.22 and his wife Ch. Lakshmi Kumari.

xiii)Regarding encashment of the pay orders and actual receiving of amount P.W.8 deposed that Ex.P.294 is the joint SB account opening form of A.22 and his wife Ch. Lakshmi Kumari and A.12 signed as introducer of the account holder and Exs.P.295 and P.296 are self cheques of A.22 for Rs.10,00,000/- and Rs.5,92,900/- respectively and

Ex.P.297 is the account statement of A.22 and his wife Lakshmi Kumari.

Exs.P.295 to P.297 show that in total an amount of Rs.15,92,900/- was withdrawn through self cheques by A.22 from the Joint SB account of 104C.C.49/2010/Prl. CBI

Court/VSP himself and his wife in Swasakthi Mercantile Bank. Ex.P.230 pay order on the face of it shows the clearing stamp of Swasakthi Mercantile

Bank. Hence, to the knowledge of A.12, A.22 had withdrawn the loan amount sanctioned to A.17 by submitting fake sale deeds without the knowledge of A.17.

xiv)Admittedly, even according to A.22 he received the entire loan of Rs.16 lakhs and A.17 neither applied for loan nor executed loan documents. Loan file of A.17 shows that prosecution did not collect the signatures of A.17 on these documents for sending the same to Expert. Hence, it is established that A.17 has no knowledge about this loan and he is innocent whereas A.22 executed a fake

sale deed under Ex.P.15 only to receive the loan amount

fraudulently in the name of A.17 though he mortgaged the same property to SBH City Civil Courts Branch, Vijayawada even prior to

Ex.P.15 sale deed. Further the very signing of A.12 in Ex.P.24 account opening form of A.17 as introducer in Vijaya Bank and Ex.P.216

Housing loan application of A.17 though A.17 neither applied for loan nor signed in those documents and signing in Ex.P.294 account opening form of A.22 in Swasakthi Mercantile Bank as introducer to facilitate A.22 and his wife in receiving the loan amounts of A.17 clearly shows his active involvement in conspiracy and cheating with regard to this loan also.

xv)Further the very signature of A.1 in first page of Ex.P.24 account opening form certifying that A.17 signed before him and signing in

Ex.P.226/Doc.54 stating that all the loan documents were signed

before him though A.17 did not sign unimpeachably shows the active

105C.C.49/2010/Prl. CBI

Court/VSP role of A.1 and conspiracy with A.22, A.12 and causing loss to the Bank by cheating. Hence, prosecution proved beyond reasonable doubt the offence of conspiracy and cheating against A.1, A.12 and A.22.

43.LOAN OF A.18:

The case of prosecution in respect of this loan is as follows:

1)A.18 applied for Rs.5 lakhs of loan on 18.3.2004 to purchase Flat

No.2, Second Floor, sheetal Vihar, Krishnalanka,Balaji Nagar,

Vijayawada, from A.13 and submitted fake IT returns, link sale deed and sale agreement to the Bank and P.W.12, as per the instructions of

A.1, without collecting margin money and verifying IT returns sanctioned loan and disbursed the same to A.13 without receiving sale deed;

2)Though A.1 conducted second check and verified the same and signed in Doc.54 he dishonestly did not point out any defects;

3)A.13 submitted fake sale deed to the bank and P.W.12 dishonestly accepted the same without obtaining legal opinion and

E.C.;

4)A.12 fraudulently introduced the SB acount of A.13 in Swasakthi

Mercantile Cooperative Bank where A.13 deposited the Demand drafts and encashed them but submitted fake sale deed to A.1; and

5)Still A.13 is owner of the property and the said acts of A.12, A.13 and A.18 caused wrongful loss to the Bank and corresponding wronful gain to the A.12, A.13 and A.18.

106C.C.49/2010/Prl. CBI

Court/VSP

The defence of A.18 is he is innocent and did not commit the offence as alleged.

44.IMPORTANT DOCUMENTS IN THIS LOAN FILE ARE AS

FOLLOWS:

i)Ex.P.18 is the alleged registered fake sale deed executed by A.13 in favour of A.18. Ex.P.235 is sale agreement in that connection.

Property covered under Exs.P.18 and P.235 is fully constructed Flat SF-2 in second floor, Sri Sheetal Vihar, Krishnalanka, Vijayawada.

ii)Ex.P.244 E.C., reflects three transactions. The first transaction is registered sale deed No.4191/2002 dated 11.2.2002 executed by P.

Nagalakshmi in favour of A.13. The second transaction is registered gift deed No.3070/02 dated 31.8.2002 executed by P. Sankar Babu in favour of P. Nagalakshmi who is the vendor under the first transaction.

The third transaction is registered sale deed No.410/05 dated; 22.3.2005 executed by A.13 in favour of A.18 which is no other than

Ex.P.18 alleged fake sale deed. On the face of it, this EC shows that colour and font size of the contents in third transaction are patently different from the first two transactions and rest of the contents in the

E.C.

iii)P.W.11/P. Yagnanarayana, SRO, Patamata, Vijayawada, deposed that Ex.P.309 is certified copy of sale deed No.4191/02 executed by P. Nagalakshmi in favour of A.13 which is reflected as first transaction in Ex.P.244 E.C. He also clearly deposed that in

Ex.P.18 Metal seal is not affixed and only rubber stamp is affixed and stamp duty details are not mentioned and signature of Sub Registrar is 107C.C.49/2010/Prl. CBI

Court/VSP not tallying and on comparing Ex.P.18 with office scanned document it shows that Ex.P.18 is a fake document and Ex.P.244 E.C., clearly

shows that third entry regarding Ex.P.18 sale deed is

incorporated and as such the said E.C., appears to be fake.

45.ENCASHMENT OF PAY ORDERS BY A.13:

i)Ex.P.246 shows that entire amount of Rs.5 lakhs of loan was given by way of pay order to A.13 on 19.3.2005 which is the date of memorandum and Doc.54. Ex.P.246 pay order on the face of it bears the clearing stamp of Swasakthi Mercantile Bank.

ii)In this connection, P.W.8/T. Padmaja, Officer of Swasakthi

Mercantile Bank deposed that one cheque was deposited in S.B.

A/c.No.5626 of A.13 in Swasakthi Mercantile Bank. Ex.P.298 is S.B.

Account opening form of A.13 in Swasakthi Mercantile Bank. It shows that account holder was introduced by A.12. Ex.P.299 is the self cheque of A.13 for Rs.4,98,000/-. Ex.P.300 Accounts statement of A.13 reflects encashment of Ex.P.299 cheque by A.13.

iii)Other loan documents of A.18 are as follows:

iv)Ex.P.231 is the account opening form of A.13. A.1 signed in first page of Ex.P.231 at the photo portion of A.31 certifying that A.13 signed before him. Last page shows that A.13 was introduced by A.6.

Ex.P.232 is the housing loan application of A.18. The name of guarantor is mentioned as Peddu Ravisankar. The names of two references in column-H are that of A.12 and A.6. Ex.P.233 and P.234 are copies of

IT returns of A.18 and his guarantor P. Ravi Sankar. In both

documents P.W.12/RLO endorsed that she verified them with

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Court/VSP originals and signed therein. But P.W.21/Nayanatara, Income Tax

Officer, deposed that they are fake IT returns and not submitted in

Income Tax Office. Ex.P.237 certificate shows that personal visit of the property was made by P.W.12 on 14.3.2005. Ex.P.239 memorandum of deposit of title deeds is signed by P.W.12. Ex.P.240 is certificate of loan papers obtained/Doc.54 signed by A.1. Ex.P.241 Credit Appraisal and

Ex.P.242 sanction letter were signed by P.W.12. Though in this loan file

A.1 signed in Ex.P.240 Doc.54, Ex.P.231 SB account opening form of

A.13 since Ex.P.240 Doc.54 clearly mentions the printed conditions regarding confirmation and execution of all the loan documents in his presence in accordance with guidelines and circulars and conditions stipulated in sanction letter are duly complied with, it cannot be said that A.1 simply signed therein without knowing anything in the loan processed by P.W.12.

v)Further memorandum, sanction letter, Doc.54 and

Ex.P.246 pay order are of the same date. Curiously there are

two memorandums in the loan file one is dated 19.3.2005 which is the date of Doc.54. But Ex.P.239 memorandum of deposit of title deeds

dated 19.3.2005 do not show the deposit of Ex.P.18 sale deed.

Obviously Ex.P.18 is dated 22.3.2005 which is subsequent to Ex.P.238 memorandum which contains eight documents including Ex.P.235 agreement of sale dated 01.3.2005. Since this is the housing loan in respect of house property sale deed in respect of the house must be deposited to create equitable mortgage. But the said document itself do not find place in Ex.P.239. Whereas there is another memorandum of deposit of title deeds under Ex.P.243 dated 24.3.2005 wherein 109C.C.49/2010/Prl. CBI

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Ex.P.18 document alone is mentioned as deposited to create equitable mortgage. But there is no mention about this document specifically in

Doc.54 and Sl.No.6 mentioning only one memorandum. The said

fact also shows the hastiness in sanction and disbursement of

loan of Rs.5 lakhs through Ex.P.246 pay order dated 19.3.2005 even

before the deposit of Ex.P.18 sale deed. All these facts cumulatively

shows that only due to conspiracy between A.1, A.12, A.13 and A.18 these acts occurred causing wrongful loss to the Bank and corresponding wrongful gain to A.12, A.13 and A.18. Hence, prosecution proved beyond doubt the offence of conspiracy and cheating against A.1, A.12, A.13 and A.18.

46.LOAN OF A.19:

i)The case of prosecution in respect of this loan is as follows:

1)A.19 applied for loan of Rs.6.5 lakhs to purchase Flat No.1,

Ground floor, Alfala residency, New Sanath Nagar, Vijayawada from A.6 and Uppuluri Venu and submitted fraudulently sale agreement and construction agreement signed by A.6 and Uppuluri Venu;

2)As per the instructions of A.1, P.W.12/RLO sanctioned loan without collecting margin money,verifying IT returns and receiving sale deed and disbursed Pay orders to A.6;

3)A.1 dishonestly carried out the second check of the documents, verified the same and signed in Doc.54 and did not ensure receipt of sale deed from Sub Registrar Office and not obtained further legal opinion on sale deeds and further EC from Sub Registrar Office and simply accepted fabricated E.Cs., submitted by loanee; 110C.C.49/2010/Prl. CBI

Court/VSP

4)Sheik Mohd. Ali Beigh is the present owner of the property against which this loan was granted;

5)A.6 and A.12 by impersonating Sri Uppuluri Venu fraudulently opened account in the names of A.6 and Uppuluri Venu in Swasakthi

Mercantile Bank, Vijayawada and A.12 introduced A.21 as Uppuluri

Venu and A.6 deposited Pay orders in this account and encashed the same and handed over 20.5 lakhs to A.12 from the account of Sri

Subba Reddy/A.7 and S. Sridevi as Commission for arranging

fabricated IT returns, Sale deeds, E.Cs., and introducing A.21 as

Uppuluri Venu; and

6)The said acts of A.1, A.4, A.6, A.12, A.19 and A.21 shows criminal conspiracy, cheating, forgery for the purpsoe of cheating and using the forged document as genuine and criminal misconduct of A.1 public servant and cauing wrongful loss to the Bank and corresponding wrongful gain to the loanees.

ii)The defence of A.19 is he availed loan by producing genuine documents as required by Bank but due to internal rivalry of the Bank employees and to implicate A.1 he became scapegoat and the higher officers concocted the documents and though he cleared the entire loan on 21.2.2006 by remitting cash in Bank and account was closed on 22.2.2006 and the same was informed to the Inspector, CBI during his examination only to implicate him in false case, FIR was registered against him.

iii)The important loan documents in respect of this loan are as follows:

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Ex.P.16 is the alleged fake registered sale deed dated 19.4.2005 executed by A.6 and U.Venu in favour of A.19. Ex.P.251 is agreement of sale dated 7.4.2005, Ex.P.265 is the alleged fake E.C., which mentions

NIL EC as well as two transactions. The first transaction is shown as registered sale deed in document No.2105/05 dated 19.4.2005 executed by A.6 and U. Venu in favour of A.19. This is no other than

Ex.P.16 transaction. The second transaction is registered sale deed bearing No.2905/04 dated 11.8.2004 executed by Saleema Begum and U.Venu in favour of A.6.

iv)Regarding this E.C. and Ex.P.16 sale deed, P.W.11/SRO, Patamata,

Vijayawada, deposed that seal affixed in Ex.P.16 is only a rubber stamp and not metal seal and stamp duty details are not mentioned and signature of Sub Registrar is not tallying and by comparing Ex.P.16 with office scanned document he stated that Ex.P.16 is a fake document.

With regard to Ex.P.265 E.C., he deposed that colour printing of words

NIL in this E.C., is different and on NIL E.C., property details are added and it appears to be fake. He further deposed that Ex.P.310 is

certified copy of sale deed No.1539/05 executed by P. Srinivasa

Rao and U. Venu in favour of Sheik Madeena Ali Beigh in

respect of the same property covered under Ex.P.16. Ex.P.310 is

dated 23.3.2005 which is one month prior to Ex.P.16 sale deed.

Ex.P.310 further shows that Ex.P.16 is a fake document and the same property by the date of Ex.P.16 was sold to others and even then

Ex.P.16 is created and fabricated.

47.AVAILING LOAN AMOUNT AND DIVERSION OF FUNDS:

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i)Ex.P.269 is the Pay order dated 19.4.2005 for Rs.2,75,000/- issued in favour of A.6 and U. Venu. On the face of it pay order contains clearing stamp of Swasakthi Mercantile Bank. This pay order is one day after the date of sanction under Ex.P.260. Ex.P.247 account opening form of A.19 in Vijaya Bank shows that A.6 introduced A.19,

A.1 signed in first page at photo portion of A.19 certifying that A.19 signed in his presence.

ii)P.W.8/Padmaja, Officer of Swasakthi Mercantile Bank, deposed that Ex.P.301 is Joint SB Account opening form of A.6 and U. Venu in

Swasakthi Mercantile Bank and three cheques were deposited in that account and A.12 introduced the account holder. She further deposed that Ex.P.304 is statement of joint account of A.6 and U. Venu and

Exs.P.302 and P.303 are the self cheques of A.6 for Rs.6,22,000/- and

Rs.8,20,000/-. Ex.P.304 reflects the encashment of Exs.P.302 and P.303 cheques by A.6 through this account.

iii)At this juncture, it is necessary to scrutinize Ex.P.301 SB account opening form of A.6 and U.Venu in view of the specific allegation made in charge sheet that A.21 impersonated U. Venu.

Ex.P.301 which is a printed format for opening the SB Account shows that names of A.6 and Uppuluri Venu are mentioned as joint account holders in column No.7. Column No.10 shows that A.12 introduced this account. In specimen signatures and photo column the photos of A.6 and A.21 was affixed for the photo of U. Venu.

iv)In this connection, prosecution examined P.W.20/Uppuluri

Venu. He clearly deposed that he got acquaintance with A.6 during lorries business and signatures in Ex.P.251 agreement of sale and P.16 113C.C.49/2010/Prl. CBI

Court/VSP sale deed are not that of him and he never sold the site to A.19.

Regarding photograph and signatures of U.Venu appearing in Ex.P.301

SB account opening form in Swasakthi Mercantile Bank, he denied both photo and signature and specifically stated that the second photograph affixed in Ex.P.301 is that of A.21 and he doesn't have any account in

Swasakthi Mercantile Bank,Vijayawada.

v)In cross examination he deposed that he doesn't remember the issues in this case as it took place fourteen years back and his mind was also disturbed due to the death of his father in accident and due to the said reasons he denied the signatures in Ex.P.251 and he doesn't remember whether he sold the site under Ex.P.16 and what was stated in sec.161 Cr.P.C., statement.

vi)P.W.22/IO clearly deposed that he obtained specimen handwritings of A.20, A.21, A.12 and P.W.20/Uppuluri Venu in this caseand sent questioned documents along with admitted and specimen writings and questionnaires to P.W.18 Expert for examination. Even according to Ex.P.329 opinion of Expert

P.W.20/Uppuluri Venu did not sign in Ex.P.301 account opening form.

vii)It is the clear case of prosecution that A.21 affixed his photo in the place of photo of U. Venu in Ex.P.301 and impersonated U.Venu and forged his signatures in conspiracy with A.12.

viii)P.W.18/Y.Chandrasekhar Rao, Branch Manager of Swasakthi

Mercantile Bank, deposed that Ex.P.301 joint account opening form of

P.Srinivasa Rao and U. Venu was introduced by A.12 and Ex.P.305 account opening form of Sri Venkateswara Estates represented by its 114C.C.49/2010/Prl. CBI

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Managing Partner, A.V.V.Narayana Rao/A.12 was introduced by

Padmavathi Constructions represented by A.V.V.Narayana Rao/A.12 and in specimen signature column also A.12 signed. He further deposed that Ex.P.304 is Statement of account of A.6 and U. Venu and under

Ex.P.307 an amount of Rs.2,75,000/- was deposited into this account and an amount of Rs.8,20,000/- was withdrawn on 19.4.2005 by A.6 and U. Venu and on 3.5.2005 an amount of Rs.6,25,000/- was deposited and Rs.6,22,000/- was withdrawn according to Ex.P.307

Statement. Though P.W.18 clearly stated that the joint account of A.6 and U. Venu was introduced by A.12 which was proved to be fraudulently opened account and A.21 impersonated U.Venu and signed as U.Venu and even Ex.P.305 account opening form of Sri

Venkateswara Estates Managing Partner A.V.V.Narayana Rao/A.12 is also introduced by A.12 himself and signed by A.12 in specimen signatures column as Managing Partner of Sri Venkateswara Estates, no suggestion was given in cross examination denying the same. These

account opening forms in Swasakthi Mercantile Bank on the

face of them shows that without ensuring the requisite proofs

and filling up of many columns they were opened carelessly.

ix)In addition to this in cross examination for A.1, P.W.18 admits close suggestion that all the transactions mentioned in his chief examination were done in accordance with Banking norms and rules.

But the said admission proved to be false from the material on record and his own admission that he doesn’t know what documents were obtained at the time of opening these accounts.

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x)Even otherwise the said admission openly shows carelessness on the part of P.W.18 even in deposing about the said accounts in Court.

From the aforementioned discussion, it is clear that A.21

signed and affixed his photo to impersonate U. Venu as

alleged.

xi)Important loan documents in respect of this loan file are as follows:

Ex.P.247 is the account opening form of A.19 signed by A.1 in first page at photo portion certifying that he signed before him.

Ex.P.248 is the housing loan application of A.19, the name of guarantor is mentioned as Battula Ranga, not an accused in this case. Column

No.5 mentions the two reference names of A.6 and A.12. Exs.P.249 and P.250 are true copies of IT returns of A.19 and his guarantor.

(Ex.P.252 is construction agreement). Ex.P.254 is the certificate signed by P.W.12/RLO mentioning the date of visit of property as 18.4.2005,

Ex.P.256 is memorandum of deposit of title deeds dated 19.4.2005 signed by P.W.12/RLO and A.19. Ex.P.257 is the ceriticate of loan papers obtained/Doc.54 signed by A.1 as well as P.W.12 ensuring the proper execution of documents in their presence and compliance of stipulations in sanction letter and guidelines and circulars of Head office, Ex.P.258 is the credit appraisal in the signature of P.W.12/RLO.

Ex.P.260 sanction letter dated 18.4.2005 and Ex.P.261 post sanction inspection report stating that date of visit to the property was on 15.4.2005 are signed by P.W.12. Ex.P.263 is memorandum of deposit of title deeds dated 28.4.2005 mentioning Ex.P.16 document and E.C.

Whereas Ex.P.256 memorandum dated 19.4.2005 did not mention 116C.C.49/2010/Prl. CBI

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Ex.P.16 document. Ex.P.266 is the post sanction inspection report signed by A.1 by mentioning that date of visit to the property was on 28.4.2005. In observations of Inspecting Official in column no.7 it is clearly mentioned that 'flat is completed'. In Ex.P.267 letter requesting release of instalments A.1 signed by endorsing 'to release

Rs.2,75,000/-'. Ex.P.269 is pay Order dated 19.4.2005 (same date as

Ex.P.16 sale deed) issued by Vijaya Bank in favour of A.6 and U. Venu for Rs.2,75,000/-. This contains clearing stamp of Swasakthi Mercantile

Bank, Vijayawada. At the back of pay order there is another stamp of

Swasakthi Mercantile Bank, Vijayawada to the effect that 'received payment through clearing house and credited to the payee's account in that Bank'. It shows that date of Ex.P.16 sale deed, Ex.P.269 pay order, Ex.P.256 Memorandum of deposit of title deeds and Ex.P.257

Doc.54 is same. IT returns of A.19 and guarantor are found to be fake according to the testimony of Income Tax officer/Nayanatara. Ex.P.268 loan account statement of A.19 reflects release of loan amounts on 19.4.2005 to the extent of Rs.2.75 lakhs in favour of P. Srinivasa

Rao/A.6 and U. Venu. The loan proceeds were withdrawn from

Swasakthi Mercantile Cooperative Urban Bank, Vijayawada by A.6 and

A.21 with the help of A.12 as per the evidence of P.Ws.8 and 18. From the aforementioned evidence Exs.P.16 sale deed, P.265 E.C. and P.249,

P.250 false IT returns are proved to be false.

xii)The said fact coupled with remaining documents in A.19 loan file reflects criminal conspiracy between A.1, A.6, A.12, A.19 and A.21.

Hence, prosecution proved beyond doubt the offence of criminal conspiracy and cheating against A.1, A.6, A.12, A.19.

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48.COMPLICITY OF A.20:

i)According to prosecution A.20 is lecturer in Government Aided

JKC College, Guntur and he entered into criminal conspiracy with A.6 and A.12 and in pursuance of the said conspiracy he impersonated S.

Subba Reddy (A.7) (FIR accused) and permitted his wife Smt.P. Lakshmi to impersonate S. Sridevi and opened the impersonated account and allowed the account to be operated by A.12 and A.6 and signed cheques and handed over the same to A.12 and A.6 for fraudulent encashment of cheques.

ii) The defence of A.20 is he is innocent and he never involved in impersonation of S. Subbareddy (A.7) and S. Sridevi in criminal conspiracy with other accused and prosecution miserably failed to prove the same and inspite of citing S. Subbareddy as L.W.18 as witness he was not examined and given up by prosecution and as such

A.20 is liable to be acquitted.

iii)In the light of above rival contentions, we shall scrutinize

Ex.P.280 which is joint SB account opening form of S. Subbareddy (A.7) and S. Sridevi. Column No.10 shows this account was introduced by

A.12. Since prosecution contend that in pursuance of conspiracy with

A.6 and A.12, A.20/Lecturer in JKC College impersonated S. Subbareddy (A.7) and permitted his wife P. Lakshmi to impersonate S. Sridevi and opened this account. Questioned signatures were sent to P.W.16/Expert for comparison with standard signatures and opinion.

iv)Expert/P.W.16 opined that questioned signature of S. Sreedevi in

Ex.P.280 is not her signature.

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v)In this connection P.W.19/S. Ramakrishna Prasad, Director, P.G.

Courses in JKC College, Guntur since 2007 deposed that he knew A.20 who worked as Lecturer in that college and on promotion he became

Head of the Department of Statistics in that college. He clearly deposed that he can identify the photograph of A.20 and Ex.P.280 shown to him contains his photograph.

vi)The evidence of S. Subba Reddy, who is cited as L.W.18 is crucial in this connection to admit or deny the signatures of himself and his wife. When that direct evidence is available to explain and throw focus upon the alleged impersonation of A.20 and his wife, the very non examination of L.W.18 by prosecution clearly disprove the said case of prosecution against A.20. Further without examining L.W.18, evidence of P.W.19 that photograph affixed in Ex.P.280 is that of A.20, is not at all sufficient and convincing to come to any conclusion about the alleged impersonation. By withholding the direct and oral evidence prosecution cannot rely upon the report of Expert which is only opinion evidence without any corroboration. Hence, prosecution miserably failed to prove the alleged offences against A.20 and as such he is liable to be acquitted.

49.COMPLICITY OF A.12:

i)Role of A.12 in many loans is discussed in detail in the aforementioned paras. In addition to that Ex.P.276 is the SB Account opening form in the name of A.12 personally with his photo without introduction of anybody. Except name and address of A.12, his photo, signature, rest of the columns are left blank in this. Ex.P.280 SB account opening form of joint account of S. Subbareddy (A.7) and S.

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Sridevi shows that A.12 introduced this account by mentioning his SB account No.3001 in that Bank. Ex.P.298 SB account opening form of

A.13 also shows that he was introduced by A.12 by mentioning his account number SB 3001 in that bank. So also Ex.P.301 SB account opening form of A.6 and U.Venu also shows the introduction of A.12.

ii)Entire material on record reflects the role of A.12 in introduction at the time of opening many loan accounts in this case and also in

Swasakthi Mercantile Bank, taking the loan amounts in A.14 and A.15 join loan through the fraudulently opened account in Swasakthi

Mercantile Bank and loan amount in some other loans in conspiracy with other accused as explained supra and helped in diversion of funds.

iii)From the aforementioned voluminous and unimpeachable evidence, prosecution proved beyond doubt the offence of conspiracy and cheating against A.12.

50.CONCLUSION ON POINTS 1 AND 2:

i)The discussion mentioned supra reflects criminal misconduct of

A.1/public servant in conspiracy with other accused and do not amount to mere procedural irregularities.Guilty cannot be permitted to walk free.

ii)Further in economic offences acquittal of accused on mere ground of subsequent repayment of defrauded amount to bank would be a misplaced sympathy and Court must see the society at large as per the ratio laid down by Hon’ble Apex Court in AIR 2015 SC 3657.

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Court/VSP iii)The aforementioned cogent, tangible, concrete and succinct evidence adduced by prosecution leads to inescapable conclusion that

A.1, A.6,A.12,A.13,A.14, A.15, A.18, A.19 and A.22 committed the offence under sec.120-B and 420 of IPC which resulted in wrongful loss of Rs.90.6 lakhs to the Bank and wrongful gain to themselves.

iv)Hence, prosecution has established the offence under sec.120-B and 420 of IPC against A.1, A.6,A.12,A.13,A.14, A.15, A.18, A.19 and A.22.

51.POINT NO.3:

i)Turning to the charge under sec.468 of IPC against A.1, A.5,A.6,

A.8 to A.15, A.17 to A.20 and A.22, it deals with forgery for the purpose of cheating.

ii)In the case on hand for the reasons mentioned supra in discussion under points 1 and 2, prosecution proved beyond doubt that all registered sale deeds and E.C., submitted in bank are proved to be fake and fabricated. Further it is also proved that A.8 to A.11 are innocent and they do not know initially that A.4 executed fake sale deeds in their favour and obtained fresh registered sale deeds subsequently after knowing the same and deposited them in bank and cleared the loan amount as bonafide borrowers. Hence, A.8 to A.11 cannot be said to have committed offence under sec.468 of IPC. A.5 is also proved to be innocent for the reasons mentioned in discussion under Points 1 and 2.

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Court/VSP iii)For the reasons mentioned supra in discussion under Points 1 and 2, prosecution proved beyond doubt that A.6, A.12, A.13, A.14,

A.15, A.18, A.19 and A.22 committed offence under sec.468 of

IPC.

iv)Hence, prosecution has established the offence under sec.468 of

IPC against A.6, A.12, A.13, A.14, A.15, A.18, A.19 and A.22 beyond reasonable doubt. I answer point No.3 accordingly.

52.POINT NO.4:

i)Sec.471 IPC envisages using of forged document as genuine. As per the elaborate discussion mentioned supra, prosecution proved beyond reasonable doubt that A.1, A.6, A.12, A.13, A.14, A.15,

A.18, A.19 and A.22 committed offence under sec.465 r/w 471 of

IPC.

ii)Hence, prosecution has established the offence under sec.465 r/w 471 of IPC against A.1, A.6, A.12, A.13, A.14, A.15, A.18, A.19 and A.22 beyond reasonable doubt. I answer point No.4 accordingly.

53.POINT NO.5:

i)The aforementioned discussion against A.1, leaves no semblance of doubt that A.1 being a public servant while working as Branch

Manager entered into criminal conspiracy with other accused and sanctioned loans deliberately to cheat the Bank by abusing his official position as public servant in utter violation of circulars of Bank and 122C.C.49/2010/Prl. CBI

Court/VSP caused wrongful loss of Rs.90.6 lakhs in total to bank and corresponding wrongful gain to and other conspirators. Hence, prosecution established offence against A.1 under sec.13(1)(d) r/w 13(2) of P.C. Act, 1988 beyond reasonable doubt.

54.For the foregoing reasons and discussion, it is inevitable to hold that prosecution could bring home the guilt of A.1, A.6 A.12, A.13,

A.14, A.15, A.18, A.19 and A.22 for the offence under secs.120-B, 420, 465 r/w 471 of IPC and A.6 A.12, A.13, A.14, A.15, A.18, A.19 and A.22 for the offence under sec.468 of IPC and A.1 under sec.

13(1)(d) r/w 13(2) of P.C. Act, 1988 beyond reasonable doubt.

55. In the result, A.1, A.6 A.12, A.13, A.14, A.15, A.18, A.19 and A.22 are found guilty for the offence under secs.120-B, 420, 465 r/w 471 of IPC and accordingly, they are convicted for the said offence under sec.248(2) Cr.P.C.

Further A.6 A.12, A.13, A.14, A.15, A.18, A.19 and A.22 are found guilty for the offence under secs.468 of IPC and accordingly, they are convicted for the said offence under sec.248(2) Cr.P.C

Further, A.1 is also found guilty for the offence under sec.

13(1)(d) r/w 13(2) of P.C. Act, 1988 and accordingly, he is convicted for the said offence under sec.248(2) Cr.P.C.

Further, A.5, A.8, A.9, A.10, A.11, A.17 and A.20 are found not guilty for the offence under secs.120-B,420,468,465 r/w471 of

IPC and they are acquitted for the said offence under sec.248(1)

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Further, A.1 is found not guilty for the offence under secs.468 of IPC and he is acquitted for the said offence under sec.248(1) Cr.P.C.

Typed to my dictation, corrected and pronounced by me in open Court on this the day 29th day of March, 2018.

PRL. SPL. JUDGE FOR C.B.I. CASES,

VISAKHAPATNAM.

56.A.1, A.6 A.12, A.13, A.14, A.15, A.18, A.19 and A.22 are questioned with regard to quantum of sentence that may be imposed against them for which they submitted as follows:

A.1 states that he is aged 65, removed from service and not getting retirement benefits, suffering from ill health, mental agony and financial hardships and his wife is also suffering from ill health and bed ridden and pleads mercy

A.6 states that he has been suffering from heart problem and his wife, father-in-law and mother-in-law are suffering from ill health and his daughter who is studying are all dependants upon him and he is the only bread winner in the family and there are financial hardships and pleads mercy.

A.12 states that he got brain stroke two years back and he is a neuro and heart patient, regularly taking treatment and his 85 years old bed ridden mother, sick paternal grandfather of 98 years, his wife and daughters are dependants upon him and pleads mercy.

A.13 states that he and his wife have been suffering from multiple health problems and his wife and only daughter are dependants upon him and he is the only bread winner in the family and pleads mercy.

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A.14 states that both hands and legs of her husband are paralyzed and he is bed ridden and she is not working due to the said problem and she got two daughters and pleads mercy.

A.15 states that his both legs and hands are paralyzed and he is totally bed ridden and he is unable to attend to his own needs and not doing any job and pleads mercy.

A.18 states that he is suffering from financial hardships and doing small private job and his mother has been suffering from ill health and got young children aged 3 y ears and 8 years and pleads mercy.

A.19 states that he is doing small private job and got multiple health problems including heart problem and pleads mercy.

A.22 states that he has been suffering from multiple health problems and his wife is a heart patient and he is an agriculturist cultivating land by taking on lease and pleads mercy.

57.Taking into consideration of facts and circumstances of the case, gravity of the offence, social impact of the crime and plea submitted by accused with regard to quantum of sentence, this Court feels that it is not a fit case to take lenient view.

58.In the result A.1, A.6 A.12, A.13, A.14, A.15, A.18, A.19 and A.22 are sentenced to undergo Rigorous imprisonment for a period of three years each and to pay fine of Rs.3,000/- each (Rupees three thousand only), in default of payment of fine, to undergo simple imprisonment for a period of two months each for the offence punishable under sec.120-B of IPC.

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A.1, A.6 A.12, A.13, A.14, A.15, A.18, A.19 and A.22 are further sentenced to undergo Rigorous imprisonment for a period of three years each and to pay fine of Rs.3,000/- each (Rupees three thousand only), in default of payment of fine, to undergo simple imprisonment for a period of two months each for the offence punishable under sec.420 of IPC.

A.6 A.12, A.13, A.14, A.15, A.18, A.19 and A.22 are further sentenced to undergo Rigorous imprisonment for a period of three years each and to pay fine of Rs.3,000/- each (Rupees three thousand only), in default of payment of fine, to undergo simple imprisonment for a period of two months each for the offence punishable under sec.468 of IPC.

A.1, A.6 A.12, A.13, A.14, A.15, A.18, A.19 and A.22 are further sentenced to undergo Rigorous imprisonment for a period of three years each and to pay fine of Rs.3000/- each (Rupees thee thousand only), in default of payment of fine, to undergo simple imprisonment for a period of two months each for the offence punishable under sec.465 read with 471 of IPC.

A.1 is further sentenced to undergo Rigorous imprisonment for a period of three years and to pay fine of Rs.3,000/- (Rupees three thousand only), in default of payment of fine, to undergo simple imprisonment for a period of two months for the offence under section 13(1)(d) read with 13(2) of P.C. Act, 1988

Total fine comes to Rs.1,08,000/- (Rupees one lakh eight thousand only).

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The substantive sentence of imprisonment awarded to A.1, A.6

A.12, A.13, A.14, A.15, A.18, A.19 and A.22 for four counts above shall run concurrently.

The period of detention, if any, undergone by A.1, A.6 A.12,

A.13, A.14, A.15, A.18, A.19 and A.22 shall be set off under sec.428 Cr.P.C.

A.5, A.8, A.9, A.10, A.11, A.17 and A.20 are directed to execute a bond of Rs.30,000/- each (Rupees thirty thousand only) undertaking to appear before the Hon’ble High Court in terms of

Sec.437-A Cr.P.C.

A.1, A.6 A.12, A.13, A.14, A.15, A.18, A.19 and A.22are informed about their right to prefer an appeal against the judgment of this Court and they are entitled to avail legal aid for preferring the appeal against the judgment of this Court, if they have no means.

Free copy of the calendar and judgment shall be furnished to

A.1, A.6 A.12, A.13, A.14, A.15, A.18, A.19 and A.22 forthwith.

Typed to my dictation, corrected and pronounced by me in open Court on this the day 29th day of March, 2018.

PRL. SPL. JUDGE FOR C.B.I. CASES,

VISAKHAPATNAM.

APPENDIX OF EVIDENCE

LIST OF WITNESSES EXAMINED ON BEHALF OF PROSECUTION.

P.W.1/08.11.17: Y. Narasimha Rao P.W.2/20.11.17: P. Uma Shankar 127C.C.49/2010/Prl. CBI

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P.W.3/21.11.17: R. Vijayalakshmi P.W.4/22.11.17: B. Nagaraj P.W.5/22.11.17: S.V.V.Ratnam P.W.6/30.11.17: T.P.S.A. Viswajith P.W.7/30.11.17: S. Narasimhulu P.W.8/04.12.17: T. Padmaja P.W.9/04.12.17: Md. Ayaz P.W.10/05.12.17: P.V.V. Durga Prasad P.W.11/05.12.17: P. Yagnanarayana P.W.12/08.12.17: Smt.K. Daisy Rajeswari P.W.13/08.12.17: D. Babu Ramji Natraj P.W.14/18.12.17: V. Subrahmanyam P.W.15/19.12.17: K. Shasidar Rao P.W.16/20.12.17: P. Venugopala Rao P.W.17/10.01.18: K. Nageswara Rao P.W.18/22.01.18: Y. Chandra Sekhar Rao P.W.19/05.02.18: S.R.K. Prasad P.W.20/06.02.18: Uppalapati Venu P.W.21/07.02.18: P. Nayanatara P.W.22/07.02.18: D. Mishra

LIST OF DOCUMENTS MARKED ON BEHALF OF PROSECUTION.

Ex.P.1: Letter dt.20.7.07 addressed by Patamata SRO to CBI Ex.P.2: Certified copy of sale deed bearing document No.1619/04. Ex.P.3: Certified copy of sale deed document No.1913/04 Ex.P.4: C.C. of Mortgage deed document No.410/05 Ex.P.5: Certified copy of sale deed bearing No.2105/05 Ex.P.6: Certified copy of gift deed bearing No.265/2005 Ex.P.7: Sale deed dt.28.6.04 bearing Document No.1619/04 Ex.P.8: Sale deed dt.13.7.04 bearing document No.5461/04 Ex.P.9: Sale deed dt.27.7.04 bearing document No.7562/04 Ex.P.10: Sale deed dt.27.7.04 bearing document No.7563/04 Ex.P.11: Sale deed dt.27.7.04 bearing document No.7561/04 Ex.P.12: Sale deed dt.31.7.04 bearing document No.10373/04 Ex.P.13: Sale deed dt.05.9.04 bearing document No.1913/04 Ex.P.14: Sale deed dt.01.12.04 bearing document No.14985/04 Ex.P.15: Sale deed dt.10.01.05 bearing document No.264/05 Ex.P.16: Sale deed dt.19.04.05 bearing document No.2105/05 Ex.P.17: Letter addressed to Regional Manager, Vijaya Bank Ex.P.18: Registered sale deed dated 22.3.2005 bearing document No.410/05 Ex.P.19: Account opening form of Ch. Chandra Sekhar Rao Ex.P.20: Account opening form of Ch. Manmadharao (A.11) Ex.P.21: Account opening form of Ch. Ramalingeswara Rao (A.8) Ex.P.22: Account opening form of A. Siva Ramakrishna (A.9) Ex.P.23: Account opening form of Y.V. Siva Rama Krishna (A.10) Ex.P.24: Account opening form of P. Nagavittal (A.17) Ex.P.25 : Account opening form of T. Srinivasu (A.15) & Ch. Sri Rani (A.14) Ex.P.26 : Account opening form of Pottluri Srinivasarao (A.6) Ex.P.27: Account opening form of Karra Raghu Babu (A.13) Ex.P.28: Credit appraisal form of Ch. Ramalingeswararao (A.8) Ex.P.29: Account statement of A.8 Ex.P.30: Credit Appraisal form of A.17 128C.C.49/2010/Prl. CBI

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Ex.P.31: Sanction memo of A.17 Ex.P.32: Account statement of A.17 Ex.P.33: Credit Appraisal form of A.14 and A.15 Ex.P.34: Statement of housing loan A/c. of Ch. Sri Rani (A.14) Ex.P.35: Credit Appraisal form of A.9 Ex.P.36: Certificate of loan papers obtained (Doc.54) of A.9 Ex.P.37: Attested photocopy of Income Tax return of A.9 Ex.P.38: Credit Appraisal form of Y.V. Siva Rama Krishna (A.10) Ex.P.39: Credit Appraisal form of Ch. Manmadha Rao (A.11) Ex.P.40: Credit Appraisal form of P. Srinivasa Rao (A.6) Ex.P.41: Credit Appraisal form of A.13 Ex.P.42: Housing loan account statement of A.6. Ex.P.43: Housing loan account statement of Y.V. Siva Ramakrishna (A.10) Ex.P.44: Housing loan account statement of A. Siva Ramakrishna (A.9) Ex.P.45: Housing loan account statement of A.13. Ex.P.46: Circular No.7/04 Ex.P.47: Circular No.63/05 Ex.P.48: Circular No.131/02 Ex.P.49: Circular No.208/05 Ex.P.50: Manual of instructions of the Bank Ex.P.51: Manual of instructions of the Bank Ex.P.52: Housing loan application of Ch.Ramalingeswara Rao and Guarantor A. Siva Ramakrishna Ex.P.53: Income tax returns of Ch. Ramalingeswara Rao for the Assessment years 2001-02, 2002-03, 2003-04. Ex.P.54: Income tax returns of A. Siva Ramakrishna for the Assessment years 2001-02 and 2002-03 Ex.P.55: Sale agreement dt.16.6.04 Ex.P.56: Stamped receipt dt.16.6.04 Ex.P.57: Construction agreement dt.16.6.04. Ex.P.58: Proceedings of Municipal Planning Commission Ex.P.59: Legal scrutiny report of Ch. Ramalingeswara Rao dt.19.6.04. Ex.P.60: Property Inspection report Ex.P.61: Valuation report dt.23.6.04 Ex.P.62: Memorandum dt.28.6.04 with regard to deposit of title deeds by Ch. Ramaingeswara Rao. Ex.P.63: Certificate of loan papers obtained dt.28.6.04 Ex.P.64: Detailed estimate dt.23.6.04 given by panel valuer Ex.P.65: Sanction communication letter addressed to Ch. Ramalingeswara Rao Ex.P.66: Request letter given by Ch. Ramalingeswara Rao for release of loan amount. Ex.P.67: Certificate with regard to completion of works given by panel valuer Ex.P.68: E.C. dt.5.7.04 Ex.P.69: Request letter given by Ch. Ramalingeswara Rao for release of loan amount. Ex.P.70: Pay orders issued in favour of Ch. Chandra Sekhar Rao towards the release of loan amount. Ex.P.71: Home loan application of A.9 and Guarantor Y.V. Siva Rama Krishna (A.10) Ex.P.72: Sale agreement dt.16.6.04 executed in favour of A.9 Ex.P.73: stamped receipt dt.9.7.04 given by A.4 Ex.P.74: Construction agreement executed by A.4 in favour of A.9 129C.C.49/2010/Prl. CBI

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Ex.P.75: Attested true copy of proceedings of Vijayawada Municipal Corporation Ex.P.76: Legal opinion report given by K. Nanda Kumar Ex.P.77: Property inspection report done and seized by A.1 Ex.P.78: Valuation report given by G.V. Ramana Ex.P.79: Memorandum with regard to deposit of title deeds by A.9 and counter signature by A.1. Ex.P.80: Estimation report given by G.V. Ramana Ex.P.81: Sanction communication addressed to A.9 and signed by RLO Ex.P.82: Request letter given by A.9 requesting for release of loan amount Ex.P.83: Construction report given by G.V.Ramana with regard to progress of construction Ex.P.84: EC dated 22.6.2004 Ex.P.85: Request letter given by A.9 with regard to release of loan amount Ex.P.86: Property inspection report signed by A.1 Ex.P.87: Request letter given by A.9 with regard to release of loan amount Ex.P.88: Four Demand Drafts Ex.P.89: Housing loan application of A.10 along with guarantor Ch.Manamadha Rao (A11) Ex.P.90 : Income tax returns of A.10 for the assessment years 2001-02, 2002-03, 2003-04. Ex.P.91 : Income tax returns of A11 for the assessment years 2001-02, 2002-03, 2003-04 Ex.P.92 : Sale agreement executed in favour of A.10. Ex.P.93 : Stamped receipt dated 9.7.2004 issued by Ch.Chandra Sekhar Rao. Ex.P.94 : Construction agreement executed in favour of A.10. Ex.P.95 : Legal scrutiny report given by K.Nanda Kumar. Ex.P.96 : Property inspection report which was done and report was signed by A.1. Ex.P.97 : Valuation report given by G.V.Ramana. Ex.P.98 : Memorandum with regard to the deposit of title deeds by A.10 and counter signed by A.1. Ex.P.99 : Certificate of loan papers obtained dated 27.7.2004, signed by RLO and Branch Head. Ex.P.100 : Estimation report given by G.V.Ramana Ex.P.101 : Sanction communication signed by RLO. Ex.P.102 : Request letter given by A.10 requesting for release of loan amount Ex.P.103 : Construction report given by G.V.Ramana. Ex.P.104 : EC dated 22.6.2004. Ex.P.105 : Request letter given by A.10 for release of loan. Ex.P.106 : Property inspection report signed by A.1 and permitted to release the loan amount. Ex.P.107 : Request letter given by A.10 requesting for release of loan amount Ex.P.108: Four Demand drafts dt.27.7.2004 for Rs. 4 lakhs, 27.7.2004 for Rs 1.5 lakhs, 2.8.2004 for Rs. 3 lakhs and on 10.11.2004 for Rs. 50,000/- Ex.P.109 : Loan application form of A.11 and guarantor A.Siva Rama Krishna(A9). Ex.P.110 : Income tax returns of A.11 for the assessment years 2001-02, 2002-03, 2003-04 Ex.P.111 : Sale agreement executed in favour of A.11.

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Ex.P.112 : Construction agreement executed in favour of A.11 by A.4. Ex.P.113 : Attested true copy of proceedings of Vijayawada Municipal corporation. Ex.P.114 : Legal scrutiny report given by K.Nanda Kumar. Ex.P.115 : Property inspection report signed by A.1 Ex.P.116 : Valuation report given by G.V.Ramana Ex.P.117 : Memorandum with regard to deposit of title deeds by A.11 and counter signed by A.1 Ex.P.118 : Certificate of loan papers obtained by RLO and Branch head Ex.P.119 : Estimation report given by G.V.Ramana Ex.P.120 : Sanction communication signed by RLO Ex.P.121 : Request letter given by A.11 requesting for release of loan amount. Ex.P.122 : Construction report given by G.V.Ramana Ex.P.123 : EC dated 22.6.2004 Ex.P.124 : Request letter given by A.11 requesting for release of loan amount Ex.P.125 : Property inspection report signed by A.1 Ex.P.126 : Request letter given by A.11 requesting for release of loan amount. Ex.P.127 : Home loan account statement and SB account statement of A.11. Ex.P.128: Four Demand drafts dated 27.7.2004 for Rs. 1.5 lakhs, 27.7.2004 for Rs. 4 lakhs, 2.8.2004 for Rs.3 lakhs and 10.11.2004 for Rs. 50,000/- in favour of CH.Chandra Sekhar Rao. Ex.P.129 : Home loan application of A.6 and guarantor P.Raghu (A20) Ex.P.130 : Income tax returns of A.6 for the assessment years 2001-02, 2002-03 and 2003-04 Ex.P.131 : Sale agreement executed by S.Sri Devi and S.Subba Reddy in favour of A.6 Ex.P.132 : Stamped receipt dated 15.5.2004 issued by S.Sridevi and S.Subba Reddy Ex.P.133 : Additional construction agreement dated 17.5.2004, executed in favour of S.Subba Reddy(A7) Ex.P.134 : Legal scrutiny report given by A.Nanda Kumar Ex.P.135 : Property inspection report prepared and signed by A.1 Ex.P.136 : Valuation report given by G.V.Ramana Ex.P.137 : Memorandum with regard to deposit of title deeds by A.6 Ex.P.138 : Certificate of loan papers obtained which was signed by RLO and branch head Ex.P.139 : Estimation report given by G.V.Ramana Ex.P.140 : Sanction communication signed by RLO Ex.P.141 : Request letter given by A6 Ex.P.142 : Construction report given by G.V.Ramana and A.1 has permitted to release the loan amount Ex.P.143 : EC dated 15.7.2004 Ex.P.144 : Request given by A.6, requesting for release of loan amount Ex.P.145 : Construction report given by G.V.Ramana Ex.P.146 : Request given by A.6 requesting for release of loan amount Ex.P.147 : Request given by A.6 requesting for release of loan amount Ex.P.148 : Property inspection report signed by A.1 and permitted for release of loan amount Ex.P.149: Three Demand drafts dated 13.7.2004 for Rs2.75 lakhs, 22.7.2004 for Rs. 2.75 and 11.8.2004 for Rs. 75,000/- in favour of S.Sridevi and S.Subba Reddy. Ex.P.150 : Home loan application of A.13 and guarantor P.Edukondalu 131C.C.49/2010/Prl. CBI

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Ex.P.151 : Income tax returns of A.13 for the assessment years 2002-03, 2003-04, 2004-05 Ex.P.152 : Sale agreement executed by S.Sridevi and S.Subba Reddy in favour of N.Raghu Babu (A13) Ex.P.153 : Stamped receipt given by S.Sridevi and S.Subba Reddy Ex.P.154 : Construction agreement executed by S.Sridevi and S.Subba Reddy(A7) in favour of A.13 Ex.P.155 : Proceedings of Commissioner, Vijayawada Municipal Corporation Ex.P.156 : Legal scrutiny report given by K.Nanda Kumar Ex.P.157 : Property inspection report which was done and signed by A.1 Ex.P.158 : Valuation report given by G.V.Ramana Ex.P.158 : Memorandum with regard to deposit of title deeds by A.13 and counter signed by A.1 Ex.P.160 : Certificate of loan papers obtained, which was signed by RLO and branch head Ex.P.161 : Estimation report given by G.V.Ramana Ex.P.162 : Sanction communication signed by RLO Ex.P.163 : Construction report given by G.V.Ramana Ex.P.164 : EC dated 4.8.2004 Ex.P.165 : Request letter given by A.13 requesting for release of amount Ex.P.166 : Request letter given by A.13 requesting for release of amount Ex.P.167 : Property inspection report prepared and signed by A.1 Ex.P.168: Three demand drafts dated 31.7.2004 for Rs. 2.75 lakhs, 11.8.2004 for Rs. 3.5 lakhs, and 4.2.2005 for Rs. 25,000/-. Ex.P.169 : Home loan application of A.14 and A15 and guarantor Rama Devi Katta. Ex.P.170 : Income tax returns of A.14 for the assessment years 2000-01, 2001-02, 2002-03, 2003-04 Ex.P.171 : Income tax returns of A.15 for the assessment years 2000-01, 2001-02, 2002-03, 2003-04 Ex.P.172 : Sale agreement executed by A.Rama Chandra Rao in favour of Ch.Srirani. Ex.P.173: Stamped receipt given by A.Rama Chandra Rao(A5) . Ex.P.174: Construction agreement executed by A5 in favour of A.14. Ex.P.175: Stamped receipt given by A.Rama Chandra Rao(A5) Ex.P.176: Legal scrutiny report given by K.Nanda Kumar Ex.P.177: Property inspection report which was signed by A.1 Ex.P.178: Valuation report given by T.Chandra Sekhar Rao. Ex.P.179: Memorandum with regard to deposit of title deeds by A.14 and counter signed by A.1 Ex.P.180: Certificate of loan papers obtained, which was signed by loans officer and branch head. Ex.P.181: Estimation report given by T.Chandra Sekhar Rao. Ex.P.182: Sanction communication signed by A1. Ex.P.183: Request letter given by A.14 requesting for release of amount. Ex.P.184: Construction report given by G.V.Ramana and permitted by A.1 to release the loan amount. Ex.P.185: EC dated 13.10.2004. Ex.P.186: Property inspection report prepared and signed by A.1. Ex.P.187: Request letter given by A.14 requesting for release of amount Ex.P.188: Two demand drafts datd 5.10.2004 for Rs. 8 lakhs and 09.11.2004 for Rs.1 lakh in favour of Sri Venkateswara Estates, H-Block 132C.C.49/2010/Prl. CBI

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Ex.P.189 : SB account opening form and specimen signatures of A.16 Ex.P.190 : Home loan application of A16 and guarantor P.Srinivasarao Ex.P.191 : Income tax returns of A.16 for the assessment years 2002-03, 2003-04, 2004-05 Ex.P.192 : Income tax returns of P.Srinivasa Rao for the assessment years 2001-02, 2002-03, 2003-04, 2004-05 Ex.P.193 : Sale agreement executed by S.Sridevi and S.Subba Reddy(A7) in favour of P.Ravi Shankar(A16) Ex.P.194 : Stamped receipt given by S.Sridevi and S.Subba Reddy(A7) Ex.P.195 : Construction agreement executed by S.Sridevi and A7 in favour of

A.16 Ex.P.196 : Stamped receipt given by S.Sridevi and A7 Ex.P.197 : Legal scrutiny report given by K.Nanda Kumar Ex.P.198 : Property inspection report which was signed by Daisy Rajeswari. Ex.P.199 : Valuation report given by G.V.Ramana Ex.P.200 : Memorandum with regard to deposit of title deeds by A.16 and counter signed by Daisy Rajeswari Ex.P.201 : Certificate of loan papers obtained, which was signed by Daisy Rajeswari and branch head/A1 Ex.P.202 : Credit appraisal form signed by Daisy Rajeswari Ex.P.203 : Estimation report given by G.V.Ramana Ex.P.204 : Sanction communication signed by Daisy Rajeswari Ex.P.205 : Request letter given by A.16 requesting for release of amount Ex.P.206 : Memorandum with regard to deposit of title deeds by A16 and counter signed by Daisy Rajeswari Ex.P.207 : Construction report given by G.V.Ramana Ex.P.208 : EC dated 6.12.2004 Ex.P.209 : Post sanction inspection report prepared and signed by Daisy Rajeswari Ex.P.210 : Request letter given by A.16 requesting for release of amount Ex.P.211 : Stamped receipt issued by S.Sridevi and A7 Ex.P.212 : Completion report given by G.V.Ramana Ex.P.213 : Photograph of the building Ex.P.214 : Loan account and SB account statement of A.16 Ex.P.215: Two demand drafts dated 1.12.2004 for Rs. 3 lakhs and 16.12.2004 for Rs. 3.3 lakhs in favour of S.Sridevi and A7 Ex.P.216 : Home loan application of A17 and guarantor Ch.Nageswara Rao and N.Raghu Babu Ex.P.217: Income tax returns of A.17 for the assessment years 2001-02, 2002-03, 2003-04, 2004-05 Ex.P.218 : Income tax returns of Ch.V.Nageswara rao for the assessment years 2001-02, 2002-03, 2003-04 Ex.P.219 : Income tax returns of N.Raghu Babu for the assessment years 2002-03, 2003-04, 2004-05 Ex.P.220 : Sale agreement executed by Ch.Nageswara Rao(A22) and Ch.Laxmi Kumari in favour of P.Naga Vittal (A17) Ex.P.221 : Stamped receipt given by Ch.V.Nageswara rao and Ch. Laxmi Kumari Ex.P.222 : Legal scrutiny report given by P.Uma Shankar Ex.P.223 : Property inspection report which was signed by A.1 Ex.P.224 : Valuation report given by G.V.Ramana Ex.P.225 : Memorandum with regard to deposit of title deeds by A.17 133C.C.49/2010/Prl. CBI

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Ex.P.226 : Certificate of loan papers obtained, which was signed by loans officer and branch head/A1 Ex.P.227 : Request letter given by A.17 requesting for release of amount Ex.P.228 : Memorandum with regard to deposit of title deeds by A17 and counter signature column is left blank Ex.P.229 : Post sanction inspection report signed by A.1 Ex.P.230: Demand draft dated 10.1.2005 for Rs. 16 lakhs Ex.P.231 : SB account opening form and Specimen signature of A.18. This account was introduced by P.Srinivasa rao and authorized by A.1 to open the account Ex.P.232 : Home loan application of A18 and guarantor Peddu Ravi Shankar(A16) Ex.P.233 : Income tax returns of A.18 for the assessment years 2002-03, 2003-04, 2004-05 Ex.P.234 : Income tax returns of Peddu Ravi Shankar for the assessment years 2002-03, 2003-04, 2004-05 Ex.P.235 : Sale agreement executed by Nara Raghu Babu (A13) in favour of A18 Ex.P.236 : Legal scrutiny report given by P.Uma Shankar Ex.P.237 : Property inspection report which was signed by Daisy Rajeswari Ex.P.238 : Valuation report given by T.Chandra Sekhar Rao Ex.P.239 : Memorandum with regard to deposit of title deeds by A.18 and counter signed by Daisy Rajeswari Ex.P.240 : Certificate of loan papers obtained, which was signed by Loans Officer i.e.Daisy Rajeswari and branch head/A1 Ex.P.241 : Credit appraisal form signed by loans office i.e. Daisy Rajeswari. Ex.P.242 : Sanction communication signed by loans officer Daisy Rajeswari Ex.P.243 : Memorandum signed by A.18 and counter signed by Loans officer Daisy Rajeswari Ex.P.244 : EC dated 28.3.2005 Ex.P.245 : Loan account and SB account statement of A.18. Ex.P.246: Demand draft dated 19.3.2005 for Rs. 5 lakhs in favour of Narra Raghu Babu(A13) Ex.P.247 : SB account opening form and Specimen signature of A.19 Ex.P.248 : Housing loan application of A19 and Co applicant K.Samrajyalaxmi and guarantor Bathula Ranga Ex.P.249 : Income tax returns of A.19 for the assessment years 2002-03, 2003-04, 2004-05 Ex.P.250 : Income tax returns of B.Ranga for the assessment years 2002- 03, 2003-04, 2004-05 Ex.P.251 : Sale agreement executed by P.Srinivasa Rao(A6) and U.Venu in favour of A19 Ex.P.252 : Construction agreement executed by A6 and U.Venu in favour of A.19 Ex.P.253 : Legal scrutiny report given by P.Uma Shankar Ex.P.254 : Property inspection report which was signed by Daisy Rajeswari Ex.P.255 : Valuation report given by T.Chandra Sekhar Rao Ex.P.256 : Memorandum with regard to deposit of title deeds by A.19 and counter signed by Daisy Rajeswari Ex.P.257 : Certificate of loan papers obtained, which was signed by Loans Officer i.e.Daisy Rajeswari and branch head/A1 Ex.P.258 : Credit appraisal form signed by loans office i.e. Daisy Rajeswari Ex.P.259 : Detailed estimate given by T.Chandra Sekhar Rao Ex.P.260 : Sanction communication signed by loans officer Daisy Rajeswari 134C.C.49/2010/Prl. CBI

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Ex.P.261 : Post sanction inspection report prepared and signed by Daisy Rajeswari. Ex.P.262 : Request letter given by A.19 requesting for release of amount Ex.P.263 : Memorandum signed by A.19 and counter signed by Loans officer Daisy Rajeswari Ex.P.264 : Certificate issued by T.Chandra Sekhar Rao for the completed works of the flat Ex.P.265 : EC dated 25.4.2005 Ex.P.266 : Post sanction report signed by A.1 Ex.P.267 : Request letter given by A.19 for release of loan amount and permitted by A.1 Ex.P.268 : Loan account and SB account statement of A.19 Ex.P.269: Demand draft dated 19.4.2005 for Rs. 2.75 lakhs in favour of P.Srinivasa rao and U.Venu Ex.P.270 : Receipt memo for handing over of original pay orders and SB account opening forms to D.Mishra, CBI, Inspector. Ex.P.271: Account statement of Chennupati Chandra Sekhar Rao (A4) Ex.P.272 : Joint report dated 9.11.2005 Ex.P.273: Letter dated 12.7.2007 addressed by Swasakthi Mercantile Co-operative

Urban Bank Ltd to Inspector CBI along with Joint account opening form of A.6 and Kuppuluri Venu bearing SB A/C No. 5724 and statement of account of said A.6 and K.Venu. Ex.P.274 : Letter dated 11.7.2006 addressed by Swasakthi Mercantile Co-operative

Urban Bank Ltd to Inspector CBI Ex.P.275 : Letter dated 20.7.2007 addressed by Swasakthi Mercantile Co-operative

Urban Bank Ltd to Inspector CBI. Ex.P.276 : SB account opening form of A.V.V.Narayana Rao (A12) in Swasakthi Mercantile Co-operative Urban Bank Ltd. Ex.P.277 : Cheque dated 6.10.2004 in favour of A.V.V.Narayana Rao (A12) issued by Sri Venkateswara Estates Ex.P.278 : Self Cheque dated 9.11.2004 in the name of A.12 Ex.P.279 : Current account statement of Sri Venkateswara Estates bearing no. 438 for the period from 15.7.2004 to 7.2.2005 Ex.P.280 : SB Joint Account opening form of S.Subba Reddy and S.Sridevi bearing no. 4879. The account was introduced by A12 Ex.P.281 : Self cheque dated 13.7.2004 of S.Subba Reddy (A7) Ex.P.282 : Cheque dated 13.7.2004 in favour of A.V.V.Narayanarao Ex.P.283 : Cheque dated 15.7.2004 in favour of U.Venu Ex.P.284 : Cheque dated 23.7.2004 in favour of P.Srinivasa rao Ex.P.285 : Cheque dated 28.7.2004 in favour of P.Srinivasa Rao Ex.P.286 : Cheque dated 31.7.2004 in favour of P.Srinivasa Rao Ex.P.287 : Pay in slip dated 31.7.2004 Ex.P.288 : Cheque dated 11.8.2004 issued in favour of P.Srinivasa Rao Ex.P.289 : Cheque dated 2.12.2004 issued in favour of A.V.V.Narayana Rao (A12) Ex.P.290 : Cheque dated 3.12.2004 issued in favour of A.V.V.narayana Rao (A12) Ex.P.291 : Cheque dated 16.12.2004 issued in favour of P.Srinivasa Rao Ex.P.292 : Cheque dated 5.2.2005 issued in favour of P.Srinivasa Rao Ex.P.293 : Account statement of S.Subba Reddy and S.Sridevi bearing No.4879 for the period from 13.7.2004 to 1.2.2006. Ex.P.294: SB Joint account opening form of Ch.Venkata Nageswara Rao(A22) and

Ch.laxmi Kumari bearing No. 5437. Ex.P.295 : Self cheque dated 10.1.2005 of A22 for Rs.10,00,000/- 135C.C.49/2010/Prl. CBI

Court/VSP

Ex.P.296 : Self cheque dated 11.1.2005 of Ch.V.Nageswara Rao for Rs. 5,92,900/- Ex.P.297 : SB account statement of A22 and Ch.laxmi Kumari bearing No.5437 for the period from 10.1.2005 to 10.7.2007 Ex.P.298 : Account opening form of N.Raghu Babu (A13) bearing A/c No. 5626 Ex.P.299 : Self cheque of A13 for Rs.4,98,000/- Ex.P.300 : Account statement of A13 for the period from 20.3.2005 to 15.2.2006 Ex.P.301 : SB account opening form of A6 and U.Venu Ex.P.302 : Self cheque of P.Srinivasa Rao for Rs. 6,22,000/- Ex.P.303 : Self cheque of P.Srinivasa Rao for Rs. 8,20,000/- Ex.P.304 : Account statement of P.Srinivasa Rao (A6) and U.Venu bearing A/cNo. 5724 Ex.P.305 : Current account opening form of Sri Venkateswara Estates Ex.P.306 : Current account opening form of Sri Venkateswara Estates bearing A/c. No. 498. Ex.P.307 : Vijaya Bank DD in favour of P.Srinivasa Rao and U.Venu Ex.P.308: Certified copy of sale deed No. 562/2003, dt. 26.2.2003 Ex.P.309 : Certified copy of sale deed no.4197/2002, executed by P.Nagalaxmi in favour of N.Raghubabu(A13) Ex.P.310 : Certified copy of sale deed no. 1539/2005 executed by P.Srinivasa Rao, U.Venu in favour of Sk.Madeena Mohamand Alibegh Ex.P.311 : Mortgage loan application form submitted by Chola Venkata Nageswara Rao (A22) Ex.P.312 : Loan account statement of A.22 Ex.P.313 : Current account opening form of A.V.V.Narayana Rao (A12 Ex.P.314 : Letter of request from A.V.V.Narayana Rao to open the account along with photocopies of KYC documents. Ex.P.315 : Letter regarding handing over the documents to CBI Ex.P.317 : Sanction order dated 27.12.2007 Ex.P.318 : Specimen handwritings of P.Raghu ExP.319 : Specimen handwritings of P.Raghu Ex.P.320 : Specimen handwritings of P.Laxmirani Ex.P.321 : Specimen handwritings of P.Edukondalu Ex.P.322 : Specimen handwritings of P. Edukondalu Ex.P.323 : Specimen handwritings of U.Venu Ex.P.324 : Specimen handwritings of A.Ramachandra Rao Ex.P.325 : Admitted writings of Accused no.12 Ex.P.326 : Specimen hand writings of A.12 Ex.P.327 : Forwarding letter by CBI to GEQD office Ex.P.328 : Forwarding letter by CBI to GEQD office for further examination Ex.P.329 : Opinion along with reasons and the forwarding letter Ex.P.330 : Supplementary opinion along with reasons and forwarding letter Ex.P.331 : Certified copy of sale deed bearing Doc.No.204/2005 dated 7.1.2005 Ex.P.332 : Certified copy of sale deed No.7925/2005 dated 27.8.2005 Ex.P.333 : Certified copy of Encumbrance Certificate dated 14.12.2007 Ex.P.334 : Certified copy of sale deed bearing Doc.No.14984/2004 registered on the file of SRO Gandhinagar, Vijayawada Ex.P.335 : Encumbrance Certificate dated 20.12.2007 Ex.P.336 : Encumbrance Certificate dated 14.12.2007 Ex.P.337 : Sale deed bearing document No.4197/2002 executed by Parimisetty Naga Laxmi in favour of Narra Raghu Babu Ex.P.338 : Letter dated 4.10.2007 sent by CBI to Commissioner of Income Tax, Vijayawada along with its enclosures Ex.P.338-A : IT returns of A.15 for the assessment year 2001-02 Ex.P.338–B : IT returns of A.15 for the assessment year 2002-03 Ex.P.338 –C : IT return of A.15 for the assessment year 2003-04 Ex.P.339 : Letter dated 19.12.2007 136C.C.49/2010/Prl. CBI

Court/VSP

Ex.P.339-A : IT returns of A.6 for the assessment year 2002-03 Ex.P.339-B: IT returns of A.6 for the assessment year 2003-04 Ex.P.339-C: IT returns of A.13 for the assessment year 2004-05 Ex.P.339-D: IT returns of A.13 for the assessment year 2005-06 Ex.P.339-E: IT returns of A.13 for the assessment year 2006-07 Ex.P.340 : Letter dated 20.11.2007 with enclosures Ex.P.341: Original FIR in R.C.2(A)/06 of CBI, VSP dt.21.2.06 Ex.P.342: Letter dt.16.2.08 issued by Senior Bank Manager, Bank of India, Vijayawada Ex.P.343: Letter dt.4.9.04 issued by Asst. Manager, Vijaya Bank, Vijayawada Ex.P.344: Letter dt.26.9.07 received from Senior Branch Manager, Vijaya Bank, Vijayawada. Ex.P.345: Form-B received from Sub Registrar, Patamata Ex.P.346: Encumbrance certificate in respect of A.14 received from SRO, Gunadala, Vijayawada. Ex.P.347: Encumbrance certificate in respect of A.14 received from SRO, Gunadala, Vijayawada. Ex.P.348: Certified copy of sale deed No.2867/06 along with translation in favour of A.10 Ex.P.349: Certified copy of sale deed No.5110/05 in favour of A.10 along with translation Ex.P.350: Certified copy of sale deed No.642/06 in favour of A.10 along with translation Ex.P.351: Attested photo copies of legal opinion with sale deed given by G. Udaibhaskar, Advocate, Vijayawada (26 sheets)

LIST OF WITNESSES EXAMINED ON BEHALF OF DEFENCE.

NIL

LIST OF DOCUMENTS MARKED ON BEHALF OF DEFENCE.

Ex.D.1 : Certified copy of registered sale deed document No.5110 dt.29.3.1995 along with Mee Seva receipt Ex.D.2 : Certified copy of registered sale deed document No.344/11 along with Mee Seva receipt (marked in cross examination of P.W.4)

Ex.D.3: Certified copy of document No.562/2003 (marked in cross examination of P.W.5)

Ex.D.4: Certified copy of sale deed dt.22.7.03 bearing No.1913/2003 (marked in cross examination of P.W.10)

Ex.D.5: Photo copy of Appointment letter dt.11.6.03.

(marked in cross examination of P.W.3)

Ex.D.6: Bank statement of Account of A.6 Ex.D.7: Bank statement of Account of A.19 Ex.D.8: Certified copy of order in O.A.86/2007 of the Hon’ble DRT at VSP Ex.D.9: Certified copy of order in O.A.103/2007 of the Hon’ble DRT at VSP 137C.C.49/2010/Prl. CBI

Court/VSP

Ex.D.10: Certified copy of order in O.A.105/2007 of the Hon’ble DRT at VSP Ex.D.11: Certified copy of registered document No.5022/05 Ex.D.12: Certified copy of registered document No.5021/05 Ex.D.13: Certified copy of registered document No.5111/05 Ex.D.14: Certified copy of registered document No.5812/08 Ex.D.15: Certified copy of plaint in O.S.635/09 on the file of III Addl. Senior

Civil Judge’s Court, Vijayawada.

(Marked with consent)

Sd/- A.Gayathri Devi

PRL. SPL. JUDGE FOR C.B.I. CASES,

VISAKHAPATNAM.

Copy submitted to

The Hon’ble Registrar (Judicial), High Court of Judicature at Hyderabad for the State of Telangana and the State of Andhra Pradesh

Copies to:

1. The A.1, A.6 A.12, A.13, A.14, A.15, A.18, A.19 and A.22.

2. The Superintendent of Police, C.B.I., Visakhapatnam.

3. The Deputy General Manager, Personnel Department (IRD), Vijaya Bank, Head Office, 41/2, M.G. Road, Bangalore-560 001, for information.

4. The office of Govt. Examiner of Questioned Documents, Directorate of Forensic Science, Ministry of Home Affairs, Govt. of India, CFI’s complex, Ramanthapur, Hyderabad-500 013.

//True copy//

Prl. Spl. Judge for CBI Cases,

Visakhapatnam..

138C.C.49/2010/Prl. CBI

Court/VSP

IN THE COURT OF THE PRINCIPAL SPECIAL JUDGE FOR C.B.I. CASES,

VISAKHAPATNAM.

Present: Smt. A. GAYATHRI DEVI, Prl. Spl. Judge for C.B.I. Cases, Visakhapatnam.

Wednesday, this the 31st day of January, 2018

C.C.No.01/2010

Between:

State represented by Inspector of Police, SPE CBI, Visakhapatnam.

…Complainant And:

Ananthaneni Venkateswara Rao, s/o Seshagiri Rao, aged 66 years, Administrative Officer, The New India Assurance Company Ltd., D.O.-I, A.P., resident of H.No.74-2-10/1, Ashok Nagar, Patamata, Vijayawada, A.P.

….. Accused

This case has come up on 17.01.2018 for final hearing before me in the presence of Sri A. Chennakeshavulu, Ld. Senior Public Prosecutor for the

State-Complainant and of Sri N.V.V.Prasad and Sri N. Sankar, Ld. Advocates

for Accused and the matter having stood over for consideration till this day,

this Court doth the following:

J U D G M E N T

The State represented by Inspector of Police, SPE CBI, Visakhapatnam, filed charge sheet in R.C.15(A)/2004 against the sole accused for the offence under sec.13(2) r/w 13(1)(e) of Prevention of Corruption Act, 1988.

2.The material averments in the charge sheet are summarized as under:

Accused hails from Kolavennu village of Kankipadu mandal, Krishna

District, Andhra Pradesh. His father is a farmer and mother is a house wife.

Accused is the eldest son. His brother and sister are married and living separately. Accused married Smt.Vijayalakshmi in the year 1978 and he got daughter and son. Daughter got married in 2002. His son Phani Kishore is 2C.C.01/2010/Prl. Spl. CBI Court/VSP studying M.Com. Except accused none of his family members i.e., his wife and children are earning members. After completing M.Sc., accused joined in

New India Assurance Company as Inspector Grade-I in the year 1977. He worked in various branches in that capacity. In the year 1985 he was promoted as Assistant Branch Manager and posted to Chirala branch.

Further, he was promoted as Administrataive Officer in 1991 and posted at

Divisional Office-I, Vijayawada. During his tenure as Administrative officer in

Divisional Office-I, Vijayawada being a public servant was found in possession of properties and pecuniary resources in his own name and in the names of his family members to the tune of Rs.42,05,386.50 ps., which is disproportionate to his known sources of income as on 31.5.2004 for which he could not satisfactorily account, thereby giving raise to presumption that he earned the said property and pecuniary sources by dubious or questionable means and through illegal or corrupt practices.

ii)Accused received income from various sources like agriculture, profit on share trading, loans from various banks, matured amounts from some financial institutions etc., during the check period i.e., from 1.1.94 to 31.5.2004. However, benefit of those incomes was not given to accused in accordance with explanation of known sources of income specified under section 13(1)(e) of P.C. Act, 1988. Since the accused has not intimated the said incomes in accordance with Rule 16(a)(6) of General Insurance (Conduct, discipline and appeal) Rules, 1975 to New India Assurance

Company Limited and also Income Tax Department. Through the aforesaid acts he committed offence punishable under sec.13(2) r/w 13(1)(e) of P.C.

Act, 1988.

3.On filing of charge sheet, case was taken cognizance against accused under secs.13(1)(e) r/w 13(2) of P.C. Act, 1988 and summons were served on 3C.C.01/2010/Prl. Spl. CBI Court/VSP accused. On appearance of accused, copies were furnished under sec.207

Cr.P.C.

4.Upon hearing both the counsel, accused was examined under sec.239

Cr.P.C., and charge for the offence punishable under sec.13(2) read with 13(1)(e) of P.C., Act, 1988 against accused was framed, read over and explained to him in English for which he pleaded not guilty and claimed to be tried.

5.During the trial, prosecution examined P.Ws.1 to 38 and got exhibited

Exs.P.1 to P.112. After closure of prosecution evidence, accused was examined under sec.313 of Cr.P.C., regarding the incriminating circumstances appearing against him from the evidence of prosecution. Accused denied the same and pleaded not guilty. Accused filed written statement.

6.During defence evidence, accused examined D.Ws.1 to 5 and got exhibited Exs.X.1 to X.6 (Ex.X.1 was marked during the cross examination of

P.W.35 and Exs.X.4 to X.6 were marked during the cross examination of

P.W.23 and Exs.X.2 and X.3 were marked through D.Ws.4 and 5).

7.Heard the learned Public Prosecutor for prosecution and learned counsel for accused. Perused the material on record.

8.Now the points for determination are:

1) Whether prosecution has proved sanction against the accused and whether Ex.P.56 sanction order dated 26.06.2006 is valid?

2) Whether prosecution has proved that accused is in possession of assets to the tune of Rs.42,05,386.50 ps., disproportionate to his known sources of income during the check period 1.1.94 to 31.5.2004?

3) whether prosecution proved charge against the accused for the offence punishable under sec.13(1)(e) r/w 13(2) of P.C. Act, 1988 beyond all reasonable doubt?

9.POINT NO.1:

4C.C.01/2010/Prl. Spl. CBI Court/VSP

i)It is needless to emphasize that sanction is a solemn and sacrosanct act and weapon to discourage frivolous and vexatious prosecution against

Government servants though not a shield to the guilty.

ii)Prosecution contend that P.W.23/the then General Manager, New India

Assurance Company Limited, Head Office, Mumbai, issued Ex.P.56 sanction order dated 26.6.2006 after perusing the entire material and on application of mind and he is competent to accord sanction to prosecute accused who is in the cadre of Administrative Officer and there is no flaw in according sanction in any manner.

iii)Interalia learned counsel for accused canvassed that P.W.23 is not competent to accord sanction as no powers were delegated to him after New

India Assurance Company became independent company in the year 2000 after separating from General Insurance Company and Ex.P.55 C.D.A Rules are not applicable to this company and P.W.23 has not received any material and Ex.P.56 is in verbatum similar to Ex.X.5 model sanction order sent by CBI along with Ex.X.4 covering letter and as such, Ex.P.56 sanction order is invalid due to non application of mind which is mandatory as per the catena of decisions of Apex Court.

iv)To buttress the said contention, Learned counsel for accused placed reliance upon the following citations:

1. Gokulchand Dwarkadas Morarka Vs. King reported in AIR 1949 PC 82;

2. Jaswant Singh Vs. State of Punjab reported in AIR 1958 SC 124;

3. Mohd. Iqbal Ahmed Vs. State of A.P. reported in AIR 1979 SC 677;

4. State through Anti Corruption Bureau, Govt. of Maharastra Vs. Krishnachand Khushalchand Jagtiani reported in AIR 1996 SC 1910;

5. State of Punjab Vs. Mohd. Iqbal Bhatti reported in (2009) 17 SCC 92;

6. Satyavir Singh Rathi, ACP Vs. State reported in AIR 2011 SC 1748;

7. State of Maharastra Vs. Mahesh G. Jain reported in (2013) 8 SCC 119; 5C.C.01/2010/Prl. Spl. CBI Court/VSP

8. 2008 (1) SCC (Crl.) 130 Crl.Ap.No.933C/W 835 of 2010 dated 01.03.2010 of Hon’ble High Court of Karnataka;

9. Hon’ble Supreme Court of India in Crl.Ap.No.1872 and 1873 of 2014;

10. 2015 SCC (Crl.) 344 Central Bureau of Investigation Vs. Ashok Kumar Agarwal;

11. Nanjappa Vs. State of Karnataka (2016) 2 (SCC) Crl. 360;

12. 2016(2)ALT (Crl.) 148 SC;

13. AIR 2005 (SC) Babi Thomson Vs. State of Goa.

v)In chief examination of P.W.23 he clearly deposed that Ex.P.55 General

Insurance Conduct, Disciplinary and Appeal Rules, 1975, as amended upto 22.3.2000 and guidelines on preventive vigilance for New India Assurance

Company Limited page no.35 shows the schedule of Authorities for the posts in the cadre of Assistant Manager, AAO and equivalent cadres, appointing authority and disciplinary authority are shown as Assistant General

Manager and appellate authority is shown as General Manager.

vi)In view of this amended Rules of the year 2000, it is crystal clear that

P.W.23 who was in the cadre of General Manager of New India Assurance

Company Limited is the authority for removal of employees in the cadre of

Administrative Officer.

vii)Further, P.W.23 clearly explained that after going through all the material sent to him and after fully convinced about issuing of sanction he requested Vigilance Department to prepare the sanction order and after such preparation he signed in the same. He strongly denied the suggestion that he signed in Ex.P.56 sanction order with ante date and he did not receive any material on 26.6.2006 and contents of Ex.X.5 draft sanction order reflects verbatum in Ex.P.56 and due to fear of CBI he obliged their request and simply signed in the sanction order though he is neither competent nor gone through any material.

viii)At this juncture it is expedient to note that in C.S. Krishnamurthy,

Appellant Vs. State of Karnataka reported in 2005 IV AD (SC) page 6C.C.01/2010/Prl. Spl. CBI Court/VSP 141 and State of Tamilnadu, Appellant Vs. Damodaran, respondent in

AIR 1992 (SC) at page 563 Apex Court held that whenever sanction is accorded after considering the detailed report of investigation and after applying its mind it is valid and a mere error, omission or irregularity in sanction is not considered to be fatal unless it has resulted in failure of justice or has been occasioned thereby.

ix)Hence, accused cannot simply contend that Ex.P.56 sanction order is invalid in the absence of specific evidence that it resulted in failure of justice as per the ratio laid down in the aforementioned decisions.

x)A careful scrutiny of testimony of P.W.23 coupled with Ex.P.55 and

Ex.P.56 leaves no doubt that P.W.23 is competent and Ex.P.56 sanction accorded by him is valid.

10.POINT Nos.2 & 3:

PROSECUTION CASE:

i)Sans the unnecessary details, essence of the case of prosecution is, accused joined in The New India Assurance Company Limited as Inspector

Grade-I in 1977 and promoted as Asst. Branch Manager in 1985 and

Administrative officer in 1991 and posted at Divisional Office-I, Vijayawada and got married in 1978 and blessed with a daughter and son and except accused, others in his family are not earning members.

ii)It is the further case of prosecution that being a public servant during the check period 1.1.94 to 31.5.04 accused was found in possession of properties and pecuniary sources in his name and in the names of his family members to the tune of Rs.42,05,386.50 which is disproportionate to his known sources of income as on 31.5.09 for which he could not satisfactorily account for and as such, he committed offence punishable under sec. 13(1)

(e) r/w 13(2) of P.C. Act, 1988.

7C.C.01/2010/Prl. Spl. CBI Court/VSP

11.DEFENCE:

Accused assailed the case of prosecution mainly on the following grounds:

1. Accused is innocent and do not possess disproportionate assets as alleged;

2. Though accused has been in service from 1977, check period was taken deliberately fixed from 1994 to 2004;

3. Though his father is an agriculturist and accused has been cultivating the inherited lands of himself and his son since 1974 and agricultural income is a major lawful source of income for him it was not taken into consideration;

4. Deliberately I.O., has shown less income and more expenditure to show disproportionate assets;

5. Many items of income received from his own department and bank are not shown; and

6. Sanction order is not valid and sanction authority is not competent to accord sanction.

12.ADMITTED FACTS:

1. Accused joint in New India Assurance Company in the year 1977 as

Inspector Grade-I and promoted as Assistant Branch Manager in 1985 and

Administrative Officer in 1991 and posted at Divisional Office-I, Vijayawada;

2. Father of accused is an agriculturist and mother is a house wife. Accused got married in 1978 and blessed with a daughter and son. None of the family members except accused are earning members;

3. Accused and his family i.e., wife and children together got nearly 13 acres of land including ancestral lands; 8C.C.01/2010/Prl. Spl. CBI Court/VSP

4. Agricultural income of accused on his ancestral property of 4 acres of wet land at Kolavennu is not taken into consideration for the entire check

13.BURDEN OF PROOF:

From the design and purport of clause (e) of sub-clause (1) to Section 13, it is apparent that the primary burden to bring home the charge of criminal misconduct there under would be indubitably on the prosecution to establish beyond either himself or through anyone else had at any time during the period of his office been in possession of pecuniary resources or property disproportionate to his known sources of income and it is only on the discharge of such burden by the prosecution, if he fails to satisfactorily account for the same, he would be in law held guilty of such offence. In other words, in case the prosecution fails to prove that the public servant either by himself or through anyone else had at any time during the period of his office been in possession of pecuniary resources or property disproportionate to his known sources of income, he would not be required in law to offer any explanation to satisfactorily account therefor.

14.Before embarking upon the details of voluminous evidence adduced by both sides, we shall now look into the legal position in this connection.

Sec.13 (1)e) and its explanation:

Sec.13. Criminal misconduct by a Public servant:- (1) A public servant is said to commit the offence of criminal misconduct,-

(a)------------------------

(b)------------------------

(c) -------------------------

(d)------------------------- 9C.C.01/2010/Prl. Spl. CBI Court/VSP

(e) if he or nay person on his behalf, is in possession 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 known sources of income.

Explanation:- For the purposes of this section, “known sources of income” means income received from any lawful source and such receipt has been intimated in accordance with the provisions of any law, rules or orders for the time being applicable to a public servant.

15.In support of the case of Prosecution Learned Public Prosecutor has placed reliance upon the following citations:

1. State of Tamilnadu Vs. Suresh Rajan reported in 2014 Cri.L.J. 1414 Supreme Court wherein the Lordships observed as follows:

“The fact that property is in the name of income tax assessee itself cannot be a ground to hold that it is actually belonging to the assessee. In case the proposition raised by accused against the said fact is accepted in our opinion it will give opportunity to the corrupted public servant to amass property in the name of unknown persons, pay

IT in their names and then B out from mischief of law.

2. State of Punjab Vs. Sajjan Singh reported in AIR 1964 Supreme Court 464. In this case Learned Public Prosecutor placed reliance upon the principle that 1/3rd of the gross salary is to be taken on non verifiable expenditure.

3. C.S.D.Swamy Vs. State reported in AIR 1960 page 7 Supreme Court wherein the Lordships observed as follows:

“The Legislature by using the expression satisfactorily account in sec.5(3) of the Act cast burden on the accused not only to offer plausible explanation as to how he came by large wealth disproportionate to his known sources of income but also to satisfy the Court that his explanation was worthy of credance.”

4. The State of Bihar Vs. Lalu Prasad and others reported in 2008 Cri.L.J 2433 wherein the Lordships observed as follows:

“findings of Income Tax Appellat Tribunal are not binding upon

Criminal Court and any saving or income prior to check period has to be proved by accused by cogent evidence regarding income and 10C.C.01/2010/Prl. Spl. CBI Court/VSP expenditure of past period on record and any such story with which defence has come up after threat of prosecution ought not to have been likely accepted by trial court without scrutinizing its legal evidentiary value”.

Regarding burden of proof learned Public Prosecutor placed reliance upon the following decisions:

1. State of Karnataka Vs. Selvi J. Jayalalitha and others in Criminal

Appeal Nos.300-303 of 2017 in Criminal Appellate Jurisdiction of

Apex Court;

2. Judgment of Special Judge CBI, Delhi in C.C.3/10 dated 18.5.2015 in

Mahesh Chandra Vs. State of U.P. reported in 1993 Cri.L.J.

16.To buttress the contention of accused Learned Counsel for accused place reliance upon the following citations:

1. 2011 (2) SCC (Cri.) 258; Ashok Tshering Bhutia Vs. State of

Sikkim wherein the Lordships erudite as follows:

“Not filling up the form under the mandatory requirement of Rule 19 of Rules 1981 may render the appellant liable for disciplinary proceedings under service jurisprudence, but that itself cannot be a ground for rejection of the said documents in toto without examining the contents thereof. In this regard, we are of the considered view that the courts below have committed a grave error and the contents thereof should have been examined.

The contention of the respondents regarding non compliance of t he

Rules 1981 adversely affecting the evidentiary value of Ex.D-4 must be rejected for at least two reasons;

i)The Rules 1981 are not rules of evidence. This admissibility and probative value of evidence is determined under the provisions of the Indian Evidence Act, 1872. These rules are merely service rules by which government servants in Sikkim are expected to abide. Consequently, the respondent has not been able to provide any cogent reason why the contents of Ex.D.4 should be disregarded; and 11C.C.01/2010/Prl. Spl. CBI Court/VSP ii)Rule 19(i)(a) of the Rules, 1981 does undoubtedly require government servants to on first appointment to any service or post and thereafter at the close of every financial year submit to the government the return of their assets and liabilities.

However, it is to be noted that the said rule envisages that public servants will submit such returns in a prescribed form.

Despite being repeatedly questioned by this Court, the respondents were unable to produce such form. Thus, it cannot be said that the appellant did not comply with the said rule as in the absence of such a form it was impossible for him to have done so (through no fault of his own). In any event, failing to submit such returns even if there had been no such a form, would make the appellant liable to face the disciplinary proceedings under the service rules applicable at the relevant time. The provisions of the Rules 1981 cannot by any stretch of imagination be said to have the effect of rendering evidence inadmissible in criminal proceedings under the P.C. Act, 1988.

Thus, in such a fact situation, the appellant could not be fastened with criminal liability for want of compliance of the said requirement of the Rules.”

2.Krishnanand Agnihotri Vs. State of M.P., reported in AIR 1977

SC 796 the Lordships held that benefit of 10% from total income received

should be given in calculation of Disproportionate Assets;

3. Narbada Devi Gupta Vs. Birendra Kumar Jaiswal & Anr., reported in AIR 2004 SC 175 the Lordships erudite that under sec.66 of

Evidence Act mere production and marking of a document as exhibit by

Court cannot be held to be due proof of contents unless execution of documents is proved by admissible evidence;

4. Boggavarapu Narasimhulu Vs. Sriram Ramanaiah and others reported in 2014 (1) ALT 577 the Lordship held that merely because document is marked as exhibit and admitted in evidence aggrieved party is not precluded from raising objections regarding its admissibility; 12C.C.01/2010/Prl. Spl. CBI Court/VSP

5. In Vasant Rao Guh Vs. State of M.P. reported in 2017 (3) ALT (crl.) 38 SC the Hon’ble Apex Court observed as follows in paras 18 and 21:

“A person cannot be subjected to a criminal prosecution either for a charge which is amorphous and transitory and further on evidence that is conjectural or hypothetical.

In case the prosecution fails to prove that public servant either by himself or through any one else at any time during the period of his office been in possession of pecuniary resources or property disproportionate to his known sources of income, he would not be required in law to offer any explanation to satisfactorily account thereafter.”

17.On the touch stone of these legal principles, we shall now test whether the prosecution has proved its case and whether the accused has satisfactorily explained income from lawful sources satisfactorily with evidence.

18.STATEMENT-A: ASSETS AT THE BEGINNING OF CHECK PERIOD:

Statement-A contains eight assets. Out of them items No.1 to 4 are lands, Item No.6 is a Plot in Ashok Nagar, Patamata, Vijayawada, with house therein, Item No.5 is gold ornaments valued as per approved gold appraiser of Andhra Bank. Item No.7 is household articles of accused as per inventory.

Item No.8 is amount invested to purchase two hundred wockhardt shares in the name of accused. Out of eight items, item no.1 to 7 are not in dispute. In respect of item no.8 there is dispute.

i)ITEM NO.8 :

a)This item is amount of Rs.19,500/- invested to purchase 200 shares of

Wockhardt in the name of accused as per charge sheet.

b)Accused denied this item.

13C.C.01/2010/Prl. Spl. CBI Court/VSP

c)This item is well covered under the common discussion of shares in items 18 to 20 and 23 of Statement-‘B’. These shares are specifically mentioned in Ex.P.7 Statement. For the reasons mentioned in common discussion, prosecution has amply proved this item. Hence, this item shall be taken into consideration.

19.STATEMENT-B: ASSETS AT THE END OF CHECK PERIOD:

Statement-B consists of 23 items. Out of them, items 1 to 4 lands are same as items 1 to 4 in Statement-A and there is no dispute in respect of them except regarding agricultural income derived there from which falls under Statement-‘C’ income and needs elaboration while discussion of items in Statement-‘C’.

i)ITEMS NO.5 TO 8:

a)These items are plot No.15 measuring 234 sq.yds., Plot No.19 measuring 233.9 sq.yds., Plot No.18 measuring 234 sq.yds., in the name of wife of accused and Plot No.22 measuring 244 sq.yds., in the name of son of accused in NIAC Employees Co-operative House Building Society respectively. In this connection, prosecution alleged that accused acquired these plots in the name of himself, his wife and son and spent Rs.70,500/- towards sale consideration for purchase of each plot and thereby he invested

Rs.2,11,500/- for three plots and Rs.81,000/- for plot No.22 (item no.8) under registered sale deeds bearing Nos.2360/2002, 2358/2002,2464/2002, 1745/2002 under Exs.P.4, P.5, P.6 and P.81.

b)Accused emphatically denied the payment of entire sale consideration under these four registered documents during the check period. Learned counsel for accused canvassed that though burden lies upon prosecution to prove that sale consideration covered under the four documents was paid during the check period only and dates of payment are crucial to calculate 14C.C.01/2010/Prl. Spl. CBI Court/VSP the amount invested during the check period, prosecution miserably failed to prove the same by examining the concerned persons and the only witness

P.W.2/Sub Registrar, Gunadala who was examined in this connection and through whom Exs.P.4 to P.6 were marked did not whisper anything about payment of consideration and admits that he has no personal knowledge about Exs.P.4 to P.6 since she was not working in that office during relevant point of time and Accused himself got examined President of NIAC

Employees Co-operative House Building Society namely Gangavarapu

Ramamurthy as D.W.3 to prove the details of payment of sale consideration.

c)In this back drop it is necessary to focus upon the testimony of crucial witness i.e., D.W.3/President of NIAC Co-operative House Building Society

Limited. According to his testimony in 1981 itself NIAC Co-operative House

Building Society was formed at Vijayawada with the main object of providing house sites to the employees of New India Assurance Company Limited and he was the first President of the said society which acquired Ac.2.70 cents of land at Gunadala, Vijayawada, in 1981 and accused being employee in New

India Assurance Company Limited was one of the members of the said society and all the members including accused contributed amounts for acquisition of the said land and he developed layout for that land with the contribution of all the members and plots were ear marked and allotted

to the members in 1990 itself and prior to 1990 almost all the

charges relating to the allotment of that land were collected from

the members. Regarding reasons for non registration of plots in 1990 D.W.2 specifically deposed that delay in registration of plots was due to the the problems with land owners who sold their land to society and as such, registrations commenced from 2001 onwards in favour of the members of the society. He strongly denied the suggestion that since no documents were filed to the effect that land was acquired by the society in 1981, he deposed falsely to support the accused.

15C.C.01/2010/Prl. Spl. CBI Court/VSP

d)A cursory glance at Exs.P.4 to P.6 and P.81 whereunder accused, his wife and son acquired four plots in total and their conjoint reading shows almost same recitals. As per the recitals in these documents on 19.3.1982 registered society bearing No.1355/1992 in the name of NIAC Co-operative

House Building society was formed and registered on the file of Deputy

Registrar of Co-operative societies and purchasers are no other than members in the society and with the contribution of members only, society purchased Ac.2.70 cents of land on 31.12.1982 under a registered document bearing No.3539/82 and thereafter society divided the said land into plots and subject to bye-laws of the society, property purchased in the name of society and divided into plots was sold to the members for bilmaktha consideration. It is specifically recited in all the four documents that entire consideration was paid to the society by vendees i.e., accused, his wife and son by instalments in cash earlier and thereby society received entire consideration earlier to the sale deeds and only acts of earmarking boundaries of plots and delivery to the vendees i.e., accused, his wife and son took place on the dates of respective sale deeds.

e)Further, Exs.P.4 to P.6 and P.81 show that accused in his capacity as

Secretary of the society executed Exs.P.4 and P.5 in his favour, Ex.P.6 in favour of his wife and Ex.P.81 in favour of his son. According to Exs.P.4 and

P.5 accused was 19th member, his wife was 56th member and his son was also a member in NIAC Co-operative House Building Society Limited.

f)Inspite of the recitals in Exs.P.4 to P.6 and P.81 and oral testimony of

President of the society that plots were allotted to the members as early as in 1990 and almost all charges regarding such allotment was collected prior to 1990 itself but registration of plots alone commenced from 2001 onwards due to the problems with owners of the land, no evidence is forthcoming from the prosecution contrary to the said evidence though burden is upon 16C.C.01/2010/Prl. Spl. CBI Court/VSP the prosecution to prove the payment of entire consideration under the four documents during the check period. Though the sale deeds were executed by society and account books, receipt books and other documents will be maintained in token of receiving consideration under registered the documents, no endeavour was made by prosecution to adduce any such evidence.

g)Hence, prosecution miserably failed to prove that accused, his wife and son paid Rs.70,500/- under Exs.P.4 to P.6 Rs.81,000/- under Ex.P.81 during the check period. Hence, these items are deleted from Statement-B.

ii)ITEM NO.9:

a)This item is house of accused bearing Door No.74-2-10/1 in Ashok

Nagar Patamata.

b)The case of prosecution in respect of this item is in total accused spent

Rs.10,78,000/- for construction of ground plus two floors and out of them ground floor was constructed in the year 1990, first and second floors were constructed during the years 1998-1999 and part of second floor was constructed after March, 1999 and accused spent Rs.2,03,000/- in 1990 for construction of ground floor and remaining amount out of Rs.10,78,000/- was spent during the check period.

c)Accused emphatically denied the same. Hence, it is the duty of prosecution to prove that accused constructed the building during the check period and invested Rs.10,78,000/- for construction.

d)At the outset as per valuation report relied upon by the prosecution, total value is Rs.10,30,000/- but not Rs.10,78,000/- as mentioned in this item.

17C.C.01/2010/Prl. Spl. CBI Court/VSP

e)Main thrust of argument advanced by Learned counsel for Accused vehemently submitted that despite the fact that burden of proof is only on prosecution, except P.W.28 who is a mere valuer none others including

Municipal employees who are best persons to speak about year of construction of building were examined.

f) To prove this item, prosecution examined P.W.28/valuer and got marked

Ex.P.60 Valuation report. P.W.28 deposed that on 3.1.05 he inspected the building along with I.O., accused and his team and after his inspection he found that ground floor was constructed in 1990 and 1st and part of 2nd floors were constructed during the period from 1998 to March, 1999 and remaining part of second floor was constructed after March, 1999 and he mentioned all observations in his report and total value of building is Rs.10.03 lakhs.

g)Accused contend that there is no basis to arrive at years of construction by P.W.28 and P.W.38/IO also did not whisper the same and accused failed to submit approved plan as per P.W.28.

h)On careful scrutiny of Ex.P.60 valuation report in page no.4 it is mentioned that notice was issued to the assessee under letter dated 30.11.2004 to submit the details about commencement and completion of building, structural drawings, approved plans, expenditure incurred, copy of sale deed etc., on or before 10.12.2004. In pages 5 and 6 it is mentioned that in response to the notices dated 30.11.2004 and 10.12.2004 accused submitted replies dated 10.12.2004 and 3.1.2005 and the entire replies were reproduced at pages 5 and 6. According to the reply reproduced in the said pages, accused clearly informed that sale deed with regard to the site estimations, challans, plan approvals etc., were submitted to his employer

New India Assurance Company Limited as well as to GIC Housing Finance

Limited at the time of obtaining loan for construction of house and requested fifteen days of time to obtain copies from his own company and GIC Housing 18C.C.01/2010/Prl. Spl. CBI Court/VSP

Finance Company Limited and accordingly, time was granted directing the accused to produce the documents on the date of inspection 3.1.2005.

i)It is pertinent to note that page No.6 clearly mentions as many as 21 documents furnished by the accused including copy of sale deed, copy of approved plan for construction of ground to second floor and the details of availing loans for construction are mentioned. Page No.7 mentions that accused has submitted all the information including affidavit given by his mother-in-law in proof of procuring teak wood. According to P.W.28 also he noted all observations in the report. Hence, it is not that no information to

P.W.28 was furnished by accused..

j)In page No.9 regarding period of construction it is noted that accused himself mentioned about the years of construction of first and second floors as August, 1998 to March, 1999 and balance work of cupboards etc., in second floor was done after March, 1999. Annexure-IV attached to Ex.P.60 report shows office copy of notices dated 30.11.2004 issued to accused seeking to submit documents as mentioned in points 1 to 15 and notice

dated 3.12.2004 issued to accused intimating the date of inspection as

3.1.2005. Point No.4 in notice dated 30.11.2004 is 'particulars regarding date of commencement and completion of building'. Point No.9 is 'year wise expenditure of construction'.

k)It is not the contention of accused that no such notice was ever served upon him or there are no approved plans and there are no details of year of construction at all for the ground, first and second floors and the details of his reply mentioned in page Nos.5 to 7 of Ex.P.60 report regarding supply of 21 copies including copy of approved plan for ground floor, first and second floors mentioned in Sl.Nos.2 and 3 of page no.6 are incorrect. Accused did not make any endeavour to file copies of approved plan for ground floor to second floor to deny the said particulars in Ex.P.60 and to prove that even 19C.C.01/2010/Prl. Spl. CBI Court/VSP

before the commencement of check period construction of first and second

floors were also completed though he himself constructed the building. and burden of proof of fact especially within the knowledge is upon that person under sec.106 of Indian Evidence Act. Despite the special exclusive knowledge regarding the said facts and possessing the relevant documents the very non filing of any such record before the Court also leads to adverse inference under sec.114 of Indian Evidence Act.

l)P.W.28 is an individual CPWD valuer worked as SE in Income Tax

Department from 2000 to 2005 at Hyderabad and more than 500 valuation reports were given according to him. In the absence of special animosity with accused, when P.W.28 had no personal knowledge about the building of accused no oblique motive can be attributed when he mentioned the details of year of construction on oral enquiries from accused and documents furnished by him in response to the notice issued to him as mentioned in

Ex.P.60 report. In the absence of any contra evidence in this connection from the accused who himself built first and second floors, the years of construction mentioned by P.W.28 for the first and second floors in Ex.P.60 valuation report can be safely taken into consideration that during the check period only 1st and 2nd floors were constructed and ground floor was constructed prior to the check period.

m)Regarding valuation, according to Ex.P.60 valuation of entire building including ground floor is Rs.10.30 lakhs. Out of that when cost of ground floor is Rs.2,03,000/- incurred in 1990 even according to the report the remaining amount i.e., Rs.8,27,000/- (Rs.10,30,000 – Rs.2,03,000) alone is the valuation of first and second floors.

n)Regarding CPWD rates mentioned in Ex.P.60 Valuation report the defence version is the rates of construction based on CPWD rates are 25% to 30% higher than the market rates prevailing in Vijayawada and there are 20C.C.01/2010/Prl. Spl. CBI Court/VSP catena of judgments which mandates that Delhi Plinth Area rates are higher than the market rates prevailing in AP and rates adapted by P.W.28 shall be scaled down to 25% to 30% and entire amount mentioned in item no.9 must be deleted.

o)P.W.28 deposed as follows:

“CPWD is Central Government Department which fixes standard rates.

I have followed in this case only CBDT standard rates and not the rates of any other department. I have evaluated the rates of all the schedule items basing on CBDT rates. Witness adds he also based on market rates where ever CBDT rates are available for the items, I followed the same and where the specifications differ, the same has been obtained from the market. It is true CBDT has approved and following

Delhi Plinth Area rates prepared by CPWD Department for evaluation of building. It is true there is difference in rates of CPWD and PWD. It is true that all the building materials were available at Vijayawada. I have not enclosed the CBDT rates to Ex.P.60. In case of availability of bills for purchasing building material they will be taken into consideration. In case of availability of accounts for construction of building then accounts have to be taken into consideration in valuing the building. It is true that I have not recorded in Ex.P.60 that I have collected rates from the Vijayawada Local market.”

p)Learned counsel for accused placed reliance upon the following citations to the effect that for assessing the value of construction in State

CPWD valuation which is based on Delhi rates need not be applied and PWD rates of State shall be applied:

1. Commissioner of Income Tax Vs. Raya R. Govindarajan in the

Hon’ble High Court of Judicature at Madras (Tax case (Appeal)

No:255 of 2014);

2. Pozir Uddin Ahemed Vs. Union of India (Represented by CBI) in

the Hon’ble Gauhati High Court (Criminal Appeal No.:9/2010)

Date of Judgemnt 05.11.2013;

3. Dy. Commissioner of Income Ta Vs. C.S. Daniel in the Hon’ble High

Court of Kerala (IT Appeal No.251 of 2012/11 th November, 2013);

21C.C.01/2010/Prl. Spl. CBI Court/VSP

4. Commissiner of Income Tax Vs. K. Jaya Kumar, in the Hon’ble High

Court of Judicature at Madras (Tax case (Appeal) No.185 of

2010);

5. The Income Tax Officer Vs. S. Ganesan in the Income Tax Appellate Tribunal ‘A’ Bench: Chennai (IT Appeal N.71/Mds/2004); and

6. Asst. Commissioner of Income Tax Vs. Sujir Prakash Nayak in the

Hon’ble High Court of Karnataka, Bangalore (IT Appeal No.477 of

2003).

q)According to P.W.28 he adopted CBDT standard rates and not the rates of any other Department and there is no evidence to show that he also made oral enquiries about market rates in Vijayawada and applied the same and though quotations were allegedly submitted regarding local market rates of

Vijayawada, they were not appended to the report and he admits that the said CBDT rates are not enclosed with his report. Since CPWD rates are higher than the market values prevailing in Vijayawada where the house is located and observations in aforementioned citations are to the effect that

Delhi Plinth area rates are higher than the rates prevailed in local markets as contended by accused, valuation with regard to first and second floors shall be scaled down.

r)For the aforementioned reasons the valuation of Rs.8,27,000/- towards construction of 1st and 2nd floors is reduced to 10% which comes to

Rs.7,44,300/-. Hence amount under Item No.9 shall be taken as

Rs.7,44,300/- instead of Rs.10,78,000/-.

iii)ITEM NO.10:

a)This item is eight bonds of IDBI of total value Rs.40,000/-. According to prosecution Rs.40,000/- was invested to purchase IDBI bonds vide certificate

No.010784980 and 124104841 during the check period. Accused denied the said version.

22C.C.01/2010/Prl. Spl. CBI Court/VSP

b)To prove the version of prosecution Exs.P.83, P.91 and P.92 were marked through P.W.38/IO. P.W.38/IO deposed at page 11 that during the month of March in the house of accused in the presence of mediators he seized Exs.P.91 and P.92 IDBI Bonds (tax saving) of Rs.5,000/- each in the name of accused and Ex.P.82 is letter with annexures confirming four tax saving bonds for total amount of Rs.20,000/-. Both Exs.P.91 and P.2 are originals of face value Rs.5,000/- each. As per Ex.P.83 letter issued by IDBI and Exs.P.91 and P.92 accused got four bonds each under Exs.P.91 and P.92 of value Rs.5,000/- and as such total amount is Rs.40,000/-.

c)The learned counsel for accused canvassed that in addition to the fact that Exs.P.83, P.91 and P.92 are not proved by examining the concerned person, even contents of Ex.P.83 letter in respect of these documents are hit by sec.162 Cr.P.C., and as such this item is liable to be deleted.

d)Though it is a fact that except P.W.38 none were examined in this connection, when original bonds under Exs.P.91 and 92 were seized during search of residence of accused according to P.W.38, curiously he was not cross examined in respect of Exs.P.83,91 and 92 either denying or raising any version in that connection. Hence prosecution has sufficiently roved the amount of Rs.40,000/- iv)ITEM NO.11:

a)This is Ac.1.00 of agricultural land in Batlapenumarru village purchased in the name of wife of accused under Ex.P.3. This item is not in dispute.

v)ITEM NO.12:

This item is described as 17 promissory notes of various dates in favour of accused for a total amount of Rs.4,35,000/- seized from the house of accused during searches. The details of dates, amount and name of promisor are mentioned in tabular form.

23C.C.01/2010/Prl. Spl. CBI Court/VSP

i)Promissory notes in Serial Nos. 1 to 5:

a)Out of 17 promissory notes, Sl.Nos.1 to 5 in the list under this item were allegedly executed by M. Lokeswararao in favour of accused for

Rs.20,000/-, Rs.35,000/-, Rs.17,000/-, Rs.25,000/- and Rs.33,000/- respectively under Exs.P.104 to P.108.

b)The aforementioned facts leaves no doubt regarding acquisition of these bonds. Except during this item, accused did not make any endeavour atleast to offer any explanation about these bonds. Admittedly, accused is an income tax assessee and as per Exs.P.13 to P.15 I.T. Returns with enclosures accused has claimed tax exemption under tax savings bonds.

c)For the aforementioned reasons this amount can be safely taken into consideration.

d)To prove these five promissory notes and that amount was lent under them by accused during the check period, prosecution did not examine the promissor M. Lokeswara Rao. These pronotes were simply marked through

P.W.38/IO. Except marking these five pronotes P.W.38 did not depose anything about the said five transactions. As contended by accused, mere marking of these pronotes under Exs.P.104 do not by itself constitute proof and non examination of alleged borrower M. Lokeswara Rao is fatal to the case of prosecution. In the absence of any proof regarding the lending of amount covered under Exs.P.104 to P.108 to M. Lokeswara Rao, it cannot be said that accused lent this amount during the check period. Hence, the total amount of Rs.1,30,000/- covered under Exs.P.104 to P.108 is to be deleted out of Rs.4,35,000/- under item no.12.

ii)Promissory Notes in serial Nos.6 to 9 :

a)Prosecution alleged that Sri Y. Krishna Prasad allegedly borrowed

Rs.25,000/-, Rs.20,000/-, Rs.15,000/- and Rs.25,000/- respectively under 24C.C.01/2010/Prl. Spl. CBI Court/VSP

Exs.P.16 to P.19 and promissory notes from accused during the check period.

To prove the said version prosecution examined P.W.6/Y. Krishna Prasad (Promissor) and got marked Exs.P.16 to P.19 promissory notes. P.W.6 deposed that he borrowed the amount covered under Exs.P.16 to P.19. In chief examiantion itself he further deposed as follows:

“I paid back the amounts covered under Exs.P.16 to P.19 to

A.Venkateswara Rao in the month of July, 2003.”

Even in cross examination he admits the same and clearly explained that he repaid an amount of Rs.1 lakh to the accused for the amounts covered under

Exs.P.16 to P.19. Since the alleged date of payment of July, 2003 falls within the check period, the said amount of Rs.1 lakh repaid shall be treated as income of accused as contended by the accused.

b)Accused further contend that since the said promissory notes were seized by CBI prior to the repayment in July, 2003 there was no endorsement of this payment on Exs.P.16 to P.19. Hence, even according to the own evidence of P.W.6 amount of RS.1 lakh repaid under Exs.P.16 to P.19 shall be taken as income of accused. Exs.P.16 to P.19 pronotes are proved and amount of Rs.60,000/- lent under Exs.P.16 to P.19 shall be taken into consideration.

iii)Promissory Note in searial No.10:

a)Prosecution contend that accused lent Rs.50,000/- to Sri R. Srinivasa

Reddy on 10.10.2002 under Ex.P.20 promissory note. To prove the same, prosecution examined P.W.8/Srinivasa Reddy and got marked Ex.P.20. P.W.8 deposed as follows in this connection in chief examiantion:

“P.W.6 arranged an amount of Rs.60,000/- through the accused on interest basis, accordingly accused lent Rs.50,000/- to me and I executed Ex.P.20 in his favour and P.W.6 attested the same. In July, 25C.C.01/2010/Prl. Spl. CBI Court/VSP 2003 I repaid entire principal and interest amount of Rs.59,000/- to accused who is present now in Court.”

b)Hence, according to the own evidence of PW.8/Promisor in July, 2003 he repaid Rs.59,000/- including interest. In cross examination P.W.8 explained that after repayment of the amount to the accused when he asked for return of promissory note, accused told him that CBI officials seized the same and pronote would be returned after receiving the same from CBI.

c)From the aforementioned clear testimony of P.W.8 since Ex.P.20 promissory note is proved, Rs.59,000/- shall be included in the income of accused.

iv)Promissory Notes in Serial Nos. 11,12 and 13:

a)Prosecution alleges that accused lent Rs.11,000/- on 27.5.94,

Rs.10,000/- on 16.11.97 and R.17,000/- on 16.7.97 to Y. Venugopala Rao under separate promissory notes during the check period. To prove the said promissory notes, prosecution examined the promisor Y. Venugopala Rao as

P.W.9. Through him Exs.P.27 to P.30 i.e., Four promissory notes were marked.

b)Ex.P.27 is dated 27.5.94 for Rs.15,000/- in favour of accused. Ex.P.28 is

dated 16.11.97 for Rs.52,000/-. Ex.P.29 is dated 4.1.98 for Rs.20,000/-.

Ex.P.30 is dated 16.11.97 for Rs.50,000/-. Promisee name not mentioned in

Exs.P.28 to P.30 promissory notes. Further out of three pronotes mentioned in the charge sheet, there is no promissory note with date 16.7.97 executed by Y. Venugopala Rao for Rs.17,000/- (serial number 13 in the table). Not only that though there is promissory note dated 27.5.94 as mentioned in serial number 11, amount under the same is Rs.15,000/- but not Rs.11,000/- as alleged by prosecution. Though there is promissory note dated 16.11.97 as mentioned in serial number 12, amount is not Rs.10,000/- as alleged by prosecution but it is Rs.52,000/-. Hence, there is lot of discrepancy between the particulars in this item and material on record.

26C.C.01/2010/Prl. Spl. CBI Court/VSP

c)However, P.W.9 deposed as follows in chief examination:

“I repaid the amount covered under Exs.P.28 to P.30 in the month of

March, 2003 to my brother-in-law and sister respectively. I have repaid

Rs.1,25,000/- towards full and final payment for the above said transactions covered under Ex.P.28 to P30 to my sister A. Vijaya

Lakshmi, wife of A. Venkateswara Rao.”

d)With regard to the borrowing of amount from wife of accused, P.W.9 explained as follows in cross examiantion :

“In 1993 I borrowed Rs.56,000/- from wife of accused for agricultural expenses and for purchase of a tractor. It is true that in 1997 since I have not repaid the amount to wife of accused, Exs.P.28 to P.30 promissory notes were executed for the amount due including interst.

In March, 2003 I made full and final settlement for the amount due under Exs.P.28 and P.30. It is true that in sec.161 Cr.P.C., statement itself I clearly mentioned that I borrowed an amount of Rs.56,000/- from the wife of accused in 1993 and I could not repay that amount and by 1997 the amount due became Rs.1,02,000/- with interest and for the said amount I executed Ex.P.28 to P.30 promissory notes in favour of the accused. It is true that I did not borrow the amount mentioned under Ex.P.28 and P.30 on the dates mentioned therein since the dates therein are only renewal promissory notes.”

e)From the aforementioned testimony of P.W.9/promisor, it is clear that under Exs.P.28 to P.30 promissory notes, he repaid Rs.1,25,000/- towards the full and final payment in March, 2003 i.e., during the check period. Hence, the said amount of Rs.1,25,000/- shall be considered as income of accused.

Since Exs.P.28 to P.30 are only renewal pronotes and amount was not borrowed under them on the dates mentioned therein the total amount of

Rs.1,02,000/- covered under Exs.P.28 to P.30 cannot be said to have lent during the check period but repaid amount of Rs.1,25,000/- shall be treated as income of accused during the check period. Since Ex.P.27 is also not tallying with amount mentioned in charge sheet, the amount of Rs.38,000/- covered under serial numbers 11 to 13 shall be deleted.

27C.C.01/2010/Prl. Spl. CBI Court/VSP

v)Promissory notes in serial Nos. 14 to 16:

a)Prosecution alleged that accused lent Rs.14,000/-, Rs.14,000/- and

Rs.9,000/- to one K. Narasimharao under Exs.P.22 to P.24 during the check period. To prove the said lending, prosecution examined P.W.7. He deposed in chief examination that he received the amount covered under Exs.P.22 to

P.24 promissory notes from accused and repaid the amount of Rs.75,000/- in the month of October, 2003 and accused intimated that promissory notes covered under Exs.P.22 to P.24 were in the custody of CBI.

b)In view of the own evidence of P.W.7 Exs.P.22 to P.24 promissory notes are proved and an amount of Rs.75,000/- which was paid towards the amount due under Exs.P.22 to P.24 in October, 2003 which is during the check period shall be taken as income of accused.

vi)Promissory notes in serial No.17:

a)Prosecution alleged that wife of accused lent Rs.95,000/- on 9.5.2003 to Sri M. Venkateswararao under Ex.P.109 promissory note. To prove the said lending, prosecution failed to examine the promissor. Except marking

Ex.P.109 promissory note through P.W.38 IO, no efforts were made to examine either promisor or attestors under Ex.P.109. Mere marking of document through IO do not constitute proof of lending Rs.95,000/- during the check period. No explanation was offered by IO or the prosecution, as to non examination of promisor under Ex.P.109 promissory note. In the absence of any proof of lending under Ex.P.109, the amount of Rs.95,000/- cannot be said to have lent by accused during the check period. Hence, this amount of Rs.95,000/- shall be deleted from sub-item No.17.

b)In view of the above findings in respect of 17 pronotes, Rs.1,30,000/- under Exs.P.104 to P.108 (serial Nos.1 to 5), Rs.38,000/- under promissory notes in Serial Nos.11 to 13 and Rs.95,000/- under Ex.P.109 promissory note 28C.C.01/2010/Prl. Spl. CBI Court/VSP in serial Nos.17, totaling Rs.2,63,000/- shall be deleted from total amount of

Rs.4,35,000/-. Amount remained after such deduction comes to

Rs.1,72,000/-. This amount alone shall be taken into consideration under

Item No.12 vi)ITEM No.13:

a)This item is, gold ornaments of value Rs.3,08,419/-. Prosecution alleged that accused purchased gold ornaments worth Rs.3,08,419/- found in his locker in Andhra Bank, Patamata and UCO Bank, Vijayawada. To prove the same, prosecution examined P.Ws.20 and 24 mediators and got marked

Exs.P.48 to P.50 and P.79 report of gold appraiser P.Sarath Chandra.

b)In Ex.P.79 report, serial Nos.1 to 27 are gold items. Items 1 and 2 are found in Andhra Bank locker, items 3 to 16 are found in UCO Bank lockers and items 17 to 27 are found in house according to prosecution. Silver items are also mentioned in Ex.P.79.

c)As per Ex.P.49 which is proceedings of locker of accused at UCO Bank there are fourteen gold items with particulars of weight, year and nature of acquisition.

d)In Ex.P.79 gold appraiser mentioned the total value of gold ornaments and silver articles, as Rs.3,08,419/- and value of gold items 1 to 27 as

Rs.3,03,107/-.

e)Main thrust of the argument of Ld. Counsel for A.1 is P.W.38/IO without deducting the value of gold ornaments and silver articles acquired prior to check period added the value of all items including the gift items and appraiser was not examined by prosecution but his report was simply marked as Ex.P.79 through P.W.38 and as such, contents of Ex.P.79 cannot be relied upon as they were not proved and value of gold by the date of 29C.C.01/2010/Prl. Spl. CBI Court/VSP acquisition is required to be independently proved by examining the gold appraiser and instead of doing that IO totally relied upon Ex.P.79 report.

f)In this connection, at page 22 P.W.38 deposed as follows:

“It is true that by the commencement of check period accused and his family members were in possession of gold ornaments. According to

Ex.P.49 there are fourteen gold items out of them, mother of accused presented item no.9 and 12 according to the contents in Ex.P.49.

Further, item no.14 in Ex.P.49 reads about gift given to the daughter of accused in her marriage who presented the gift is not mentioned.

According to Ex.P.48 there are two items, one is gold vaddanam weighing 231 grams reportedly purchased six years back by that day and other item i.e., gold vanki weighing 31 grams reportedly purchased ten years back by that day. I got the gold ornaments valued by Appraiser. I cannot now say the value of the gold prevailing at the time of appraising the gold ornaments or earlier to the check period.

Witness adds gold price prevailing at the time of acquisition was considered by the Appraiser.”

g)Ex.P.49 proceedings of lockers of accused at UCO Bank contains fourteen gold items with particulars of weight, year and nature of acquisition.

As per the contents of Ex.P.49, items in serial numbers 4,11 and 14 alone were acquired in the year 2002 that is during the check period and serial

No.4 red stone bangles were reportedly presented by mother-in-law of accused and serial No.11 gold kumkuma bharani was presented in 2002 and serial No.14 gold haram, pendant, ear studs and hangings were presented in 2002 in daughter’s marriage. Remaining eleven items out of 14 were acquired prior to check period. There is lot of difference between Ex.P.79 list and Ex.P.49 in respect of the crucial aspects of description, weight and acquisition of some items. Item No.4 is pair of red stone gold bangles weighing 40 gms., presented in 2002 and item no.10 is 8 gold bangles weighing 106 grams as per Ex.P.49. As per Ex.P.79 eight gold bangles were weighing 111 grams and there are no stone bangles. Item No.11 gold 30C.C.01/2010/Prl. Spl. CBI Court/VSP kumkuma bharani is 23 grams and acquired in 2002 as per Ex.P.49. As per

Ex.P.79 its weight is 25 grams. Item No.2 gold Kasulaperu is 55 grams in weight as per Ex.P.49. But according to Ex.P.79 weight is 59 grams. Weight of Item No.14i.e., gold haram and ear rings in Ex.P.49 is 40 grams. Whereas as per Ex.P.79 it is 46 gms. Weight of item no.3 waist chain is 88 grams in

Ex.P.49 whereas it is 98 grams in Ex.P.79. Item No.7 locket weight is 7 grams as per Ex.P.49 whereas it is 7 grams according to Ex.P79.

h)With so many differences as highlighted above, Ex.P.79 valuation of items found in UCO Bank locker cannot be accepted. Even otherwise as mentioned supra except items 4,11 and 14 in Ex.P.49 rest of the items were acquired prior to the check period and these 3 items 4,11 and 14 were presented in 2002.

Turning to Ex.P.48 list found in locker of Andhra Bank, there are only two items i.e., gold vaddanam purchased 6 years back and gold vankey purchased 10 years back. According to P.W.38/IO, appraiser considered the price of gold at the time of acquisition. Hence, value of these two items in

Ex.P.79 i.e., Rs.89,100 + Rs.11,500 = Rs.1,00,600/- can be accepted and taken into consideration since value by the year of purchase is mentioned.

i)Ex.P.50 mentions eleven gold items found in the house of accused. Out of these as per Ex.P.79, except Item no.3 of value Rs.1900/-, item No.4 of value Rs.4,400/-, Item N.7 of value Rs.2,200/- i.e., totaling Rs.12,900/- other items were acquired prior to check period and cannot be taken into consideration. Ex.P.50 also mentions four items of silver articles found in the house. Since according to Ex.P.50 and P.79 they were acquired in 1985 i.e., prior to check period cannot be taken into consideration.

j)According to I.O., since appraiser valued the gold items according to the rates of the year of acquisition without making separate calculation taking into consideration of same value gold worth Rs.1,00,600/- under 31C.C.01/2010/Prl. Spl. CBI Court/VSP

Ex.P.48 and gold worth Rs.12,900/- under Ex.P.50 i.e., in total Rs.1,13,500/- shall be taken into consideration as gold acquired during the check period.

k)Hence, instead of Rs.3,08,419/- amount of this item shall be taken as

Rs.1,13,500/-.

vii)ITEM No.14:

Item No.14 is not in dispute.

viii)ITEM Nos.15 & 16:

a)According to prosecution item no.15 is there was balance amount of

Rs.29,933/- at the end of the check period in Account No.3384 of accused in

UCO Bank, Venkateswarapuram Branch, Vijayawada and item no.16 is Bank balance of Rs.1305/- in the account of accused in HDFC Bank, Vijayawada

Branch, by the end of the check period.

b)To prove the same, prosecution examined P.Ws.16 and 15 and got marked Exs.P.40 and P.39 statement of accounts respectively.

c)Learned counsel for accused canvassed that both Exs.P.39 and P.40

Statements are not certified in accordance with sec.65-B of Indian Evidence

Act or sec.2A of Bankers' Book Act and they are inadmissible in evidence in view of the ratio laid down by Apex Court in P.K. Basheer Vs. Anwar

Basha reported in 2014 STPL (web) 618 SC and as such the amount covered under items No.15 and 16 are to be deleted.

d)In view of the aforementioned submissions of Learned counsel for accused, a simple glance at Exs.P.39 and P.40 Statement of accounts shows that though they are computer printouts they are not certified in accordance with sec.2A of Bankers' Book of Evidence Act or in accordance with sec.65B of Indian Evidence Act. Prosecution did not cite any decision contra to the 32C.C.01/2010/Prl. Spl. CBI Court/VSP ratio laid down by Apex Court in P.K. Basheer Vs. Anwar Basha reported in 2014 STPL (web) 618 SC.

e)P.W.16/the then Branch Manager of UCO Bank, Labbipet Branch,

Vijayawada, deposed that Ex.P.40 contains joint Statement of accused and his wife and from 2.91997 to 4.1.2000 there is manual statement and rest is computer generated attested copies of statement and they are certified by

Deposit Officer and furnished documents and covering letters of Ex.P.40 contains his signature. According to P.W.16 Bank balance was Rs.29,933/- as on 31.5.04 according to Ex.P.40.

f)A simple glance at Ex.P.40 shows that it is not certified in accordance with sec.2A of Bankers’ Books Evidence Act or sec.65A of Indian Evidence

Act. Ex.P.40 did not contain even endorsement that it is true copy. It simply contains initial and stamp of bank in each page. Though Ex.P.40 contains manual statement of only one page for a small period of 2 years 3 months and though P.W.16 deposed that statement is certified by deposit officer Sri

B.V.K. Prasad, no such certification is seen in Ex.P.40. P.W.16 did not depose that he got personal knowledge or he verified the particulars mentioned in the statement. Hence overall appreciation of the aforementioned oral and documentary evidence leads to inescapable conclusion that prosecution miserably failed to prove the balance amount mentioned in item 15 as contended by accused. Hence, item No.15 amount cannot be considered.

g)Turning to item no.16, P.W.15 deposed that he worked as Branch

Manager during the relevant period of time and he himself furnished Ex.P.39 individual SB statement of account of accused and joint account of accused, his wife and son in respect of loans against shares by attesting the same.

This account is for the period from 2000 to 2004, which is totally during the tenure of P.W.15 as Branch Manager in that branch. Since P.W.15 himself got personal knowledge about the contents of Ex.P.39 and verified the 33C.C.01/2010/Prl. Spl. CBI Court/VSP statements drawn and attested the same there is absolutely no reason to doubt or discredit his testimony. Hence, balance amount of Rs.1305/- mentioned in Ex.P.39 is to be taken into consideration.

ix)ITEM No.17:

a)The prosecution contend that accused purchased second hand Bajaj

Chetak scooter bearing registration No. AP 16M 0626 on 7.4.97 from one Sri

V. Gopalakrishnaiah for Rs.10,000/-.

b)The defence version in this connection is owner of the said scooter namely V. Gopalakrishnaiah was not examined to prove the alleged payment of Rs.10,000/- by accused to him and except marking Form No.44 issued by

RTO, Vijayawada, under Ex.P.93 through P.W.38/IO, prosecution did not make any efforts to prove the alleged payment though passing of consideration to the extent of Rs.10,000/- itself is crucial in this connection and as such, prosecution miserably failed to prove the payment of Rs.10,000/-.

c)In the light of this, a careful scrutiny of Ex.P.93 which is Form No.44 issued by RTO, Vijayawada shows that it was simply marked through

P.W.38/IO and owner of the scooter Sri V.Gopalakrishnaiah was not examined.

Further Ex.P.93 shows that the original owner of the scooter was V.

Gopalakrishnaiah and it was transferred to the accused on 07.04.97. In

Ex.P.50 inventory also this scooter and amount of Rs.10,000/- is mentioned.

According to P.W.38 value of items and year of acquisition are mentioned in

Ex.P.50 as informed by accused. Though Ex.P.50 was prepared in the presence of accused and signed by him he never raised any protest or endorsed any objection regarding value or year of acquisition. Since in

Ex.P.50 also this scooter is mentioned as purchased for Rs.10,000/- there is no reason to doubt the amount of Rs.10,000/- simply because it is not mentioned in Ex.P.93. Hence, this item of Rs.10,000/- is taken into consideration.

34C.C.01/2010/Prl. Spl. CBI Court/VSP

x)ITEM Nos.18,19,20 & 23 Shares:

a)All these items are shares. Item No.18 is described as shares of

Rs.1,95,970.69 ps., purchased by accused and retained till the end of check period, according to charge sheet.

b)Item No.19 is described as shares of Rs.2,02,144.14 ps., purchased by accused ins the name of his wife Smt.A. Vijayalakshmi and retained till the end of check period, according to charge sheet.

c)Item No.20 is described as shares of Rs.2,74,027/- purchased by accused in the name of his son A. Phani Kishore and retained till the end of check period, according to charge sheet.

d)Item No.23 is 200 shares of Wockhardt of value Rs.19,500/- purchased

before the check period and retained till the end of check period, according

to charge sheet.

e)All these four items are denied by accused.

f)To prove the said investment made by accused, prosecution examined

P.W.3 Branch Manager of Integrated Enterprises India Pvt. Ltd., and got marked Exs.P.7 and P.8 Statements maintained by NSDL. Ex.P.85 letter of

Insight share Brokers Pvt. Ltd., with enclosures and Ex.P.95 letter of NSDL in connection with these shares through P.W.38/IO

g)At this juncture, it is pertinent to note that serial Numbers 109 to 113 in page No.7 of Ex.P.50 inventory list of the items found in residence of accused shows Delivery instructions by client pertaining to Integrated

Enterprises (India) Ltd., Chennai bearing separate ID numbers and receipts.

Further serial numbers 143 and 144 of page number 10 of Ex.P.50 shows that they are identity cards of Insight Share Brokers Pvt. Ltd., in the names of accused and his son respectively. Client codes are mentioned as A301A4 35C.C.01/2010/Prl. Spl. CBI Court/VSP and A301A5 respectively. Further serial number 146 in page 11 of Ex.P.50 mentions ID cards from Integrated Enterprises (India) Ltd., Chennai, in the names of accused, his son and wife and Smart Investor Forms in the names of accused and his wife with ID numbers and membership numbers. P.W.3 is no other than Branch Manager of Integrated Enterprises India Pvt. Ltd.

h)It is worthy to note that in Item No.14 of Additional income accused claims an amount of Rs.84,664/- on the ground that he and his wife and son obtained this total amount towards sale of shares and dividends and the chartered accountant who filed Ex.P.15 I.T. returns of accused, his wife and son clearly explained the same and P.W.38/IO admits the same. Hence, there is no dispute regarding owning of shares by accused, his wife and son.

i)On the top of it Ex.P.15 IT Return with enclosures shows separate sheet regarding calculation of long term and short term capital gains n shares. As many as 11 items of shares with particulars of acquisition, value of shares and profit on them are clearly mentioned. All these shares were purchased during the check period according to the information furnished by accused to

IT Department.

j)Further P.W.15 deposed that Ex.P.39 joint statement of accused, his wife and son is in respect of loans against their shares.

k)Further Ex.P.95 shows that Assistant Vice President of NSDL instructed to furnish transaction statements of accused and his family members to

Inspector, CBI. As per the said directions only according to the contents in

Exs.P.7 and P.8 transaction statements are furnished by Integrated

Enterprises (India) Ltd., by marking copy to Assistant Vice President, NSDL.

All these items are very much reflected in Exs.P.7 and P.8. Further as per

Ex.P.85 dividends received by them were credited into the account of their clients (i.e., accused, his wife and son) through cheques.

36C.C.01/2010/Prl. Spl. CBI Court/VSP

l)When so much of evidence is available about the shares of accused and his family and he himself disclosed the same to Income Tax Department under Ex.P.15 IT Returns, I find no force in the argument that something more and beyond to be done by prosecution in this connection.

m)In view of ample evidence on these four items i.e., 18,19,20 and 23 amount covered therein shall be accepted in toto.

xi)ITEM No.21:

a)This item is NSC bonds allegedly purchased by accused on 30.3.1999 at Venkateswarapuram Post Office, Vijayawada for Rs.10,000/- and maturity amount was received after the check period according to charge sheet.

b)In this connection, prosecution examined P.W.5/chartered Accountant and got marked Ex.P.13 office copy of Income Tax Return.

c)P.W.5 deposed that Ex.P.13 contains income tax returns, income tax acknowledgment, housing loan interest certificate, donation receipt and other connected papers for filing income tax return for assessment year 1999-2000 in the name of accused and Ex.P.13 return was filed on 29.6.1999 and the said return was prepared by him on the instructions of accused and accused claimed deductions under sec.80 on various investments and donations and he purchased NSC Bond worth Rs.10,000/- during the year.

d)A simple glance at Ex.P.13 shows number of enclosures including the xerox copy of six year National Savings Certificate for Rs.10,000/- purchased in the name of accused on 30.3.1999 along with IT return for the Assessment year 1999-2000. It further shows that Tax rebate was claimed by showing six items including this NSC bond.

e)The aforementioned testimony of PW.5 along with P.W.13 IT return and NSC certificate for Rs.10,000/- and claiming tax reduction basing on the 37C.C.01/2010/Prl. Spl. CBI Court/VSP said NSC bond in addition to others amply proves the investment of

Rs.10,000/-, as mentioned in the charge sheet.

xii)ITEM No.22:

a)According to prosecution Rs.56,000/- worth household articles were found in the residence of accused as mentioned in the inventory prepared on the date of conducting search.

b)Defence version is except examining P.W.20 mediator and marking

Ex.P.50 inventory list prosecution did not adduce any other evidence and in addition to that when accused joined in service in 1977 itself in the absence of any evidence it cannot be said that household articles in Ex.P.50 list were purchased during the check period only i.e., from 1994 to 2004 but not prior to that and as such the amount shown against Item No.22 is to be deleted.

c)In this connection, it s necessary to throw light upon Ex.P.50 inventory list prepared at the residence of accused. In Ex.P.50 it is simply mentioned that the said inventory was prepared in the presence of independent witnesses and the mode of acquisition, year and the approximate price of articles are mentioned as per the version of accused and his wife.

d)In Item No.7 of Statement-‘A’ Assets prior to check period, value of house hold articles are mentioned as Rs.36,000/-. That item is not disputed.

Burden of proof is upon the prosecution to prove positively that during the check period only articles worth Rs.56,000/- were purchased. Unless and until prosecution proves the same, onus of proving otherwise do not shift to the accused.

e)Out of several items mentioned in the list, Item no.1 TV, Item Nos.5,6,9 i.e., Dining table, wooden sofa set and wooden pooja mandir, Item No.10 wooden stool, Item No.22 show light, Item Nos.25 and 26 (one large and one small Hot pack boxes), Item No.31 (Brass statute, Item No.32 Vivekananda 38C.C.01/2010/Prl. Spl. CBI Court/VSP

Statue, Item No.33 decorative piece, Item No.36 Wall Hanger, Item No.39

Assembled Air Conditioner, Item No.40 Stabilizer, Item No.42 Cordless telephone, Item No.46 Godrej Almirah, Item No.47 double bed, Item No.48 plastic chair, Item No.52 suit case, Item No.63 carom board, Item No.92

Godrej Almirah, Item No.94 ceiling fan, Item No.100 Geaser in bathroom,

Item No.123 Sumith Mixer, Item No.125 National Electric cooker, Item No.127 three Brass pots, Item No.132 Steel plate stand, Item No.133 ceiling fan and

Item No.134 Exercise cycle were acquired much prior to the commencement of check period and some of these items were also presented as per the inventory list. Hence, it is not that all the house hold articles enumerated in

Ex.P.50 list were acquired only during the check period and not prior to that.

Hence, the amount covered under the aforementioned items is to

be deleted from Ex.P.50 list.

f)At page 3 of Ex.P.50, Rs.30,000/- is mentioned towards purchase of computer with table in 2001 by taking loan from IOB. Though no evidence is adduced in this connection separately accused himself in Item No.9 of

Additional income claimed Rs.30,000/- of income on the ground that he

availed Rs.30,000/- loan from IOB for purchase of computer. Hence, value of this big item can be safely accepted in toto. Bajaj Chetak Scooter was purchased for Rs.10,000/- as mentioned in Ex.P.50 list. This Scooter is mentioned separately as item 17 of Statement-‘B’ and cannot be included in household articles. Hence, this item is to be deleted from Ex.P.50.Further silver articles of weight 1328 gms., of value Rs.6,540/- are mentioned in

Ex.P.50. These silver items are included in the valueItem No.13. Ex.P.79 gold appraiser report mentions gold and silver items and total value given by him is mentioned in charge sheet. Hence, these silver items amount be deleted from Ex.P.50 list.

39C.C.01/2010/Prl. Spl. CBI Court/VSP

g)Viewed in all angles by deleting the value of articles acquired prior to the check period value of articles acquired during the check period including the computer (Rs.30,000/-) comes to Rs.53,000/-. Hence, amount under this item shall be taken as Rs.53,000/- instead of Rs.56,000/-.

xiii)ITEM No.23:

This item is 200 shares of Wockhardt allegedly purchased before check period and retained till the end of check period. This item is well covered under the common discussion of shares in items 18 to 20 and 23 of

Statement-B. These shares are reflected in Ex.P.7 statement. For the reasons mentioned in common discussion prosecution has amply proved this item.

Hence, this item shall be taken into consideration.

From the aforementioned findings the following consolidated table would emerge:

STATEMENT-B

(ASSETS AT THE END OF CHECK PERIOD)

Item No.Description ofAs per I.O. Rs.As perValue as per AssetAccused considered by charge Rs.Court sheetRs.

1.Agricultural land 000 measuring Ac.4.00 in S.No.691-2B of Kolavennu Village

2.Agricultural land 000 measuring about Ac.2.25 cents in S.No.296/1 of Kolavennu village

3.Agricultural land 464464644646,446 measuring about Ac.4.02 cents in S.Nos.580,581 and 102/8 of Batlapenumarru village

4. Agricultural land 195001950019,500 measuring about Ac.1.55 cents in S.Nos.102/7,102/8 40C.C.01/2010/Prl. Spl. CBI Court/VSP & 102/9 at Batlapenumarru village

5.Plot No.15 70,5000Deleted measuring 234 sq.yds., at S.Nos.197,198/1

6.Plot No.19 70,5000Deleted measuring 233.9 sq.yds., at S.Nos.197,198/1

7.Plot No.18 70,5000Deleted measuring 234 sq.yds., at S.Nos.197,198/1

8.Plot No.22 81,0000Deleted measuring 244 sq.yds., at S.Nos.197,198/1

9.Residential house 10,78,00007,44,300 built at D.No.74-2- 10/1 at S.No.222/1, Ashok Nagar, Patamata, Vijayawada, as per the CPWD Valuation

10.8 bonds of IDBI 40,000040,000

11.Agricultural land 1,000,001,00,0001,00,000 measuring about 1 acre in S.No.582/1, 582/2 at Batlapenumarru village

12.Amount 4,35,0001,72,0001,72,000 outstanding as per Promissory notes

13.Gold ornaments 3,08,41901,13,500

14.Refundable deposit1,9001,9001,900 made to obtain HPCL Ga sconnection

15.Bank balance held 29,9330 by accused at UCO Bank

16.1,30501,305 Bank balance at HDFC Bank

17.One Bajaj Chetak 10,000010,000 Scooter bearing No.AP 16M0626

18.Shares purchased 1,95,970.690 1,95,970.6 by the accused9

19.Shares purchased 2,02,144.10 2,02,144.14 by accused in the 41C.C.01/2010/Prl. Spl. CBI Court/VSP name of his wife

20.Shares purchased 2,74,0270 2,74,027 by accused in the name of his son

23.200 shares of 19,5000 19,500 Wockhardt purchased

21.NSC No.16EE 10,000010,000 948140 purchased on 30.3.99 at Post office

22.House hold articles56,000053,000 found in the residence of accused Total31,20,644.833,39,846 20,03,592.83

20.STATEMENT-C INCOME:

i)ITEM No.1:

It is net salary of Rs.8,29,934/- received by accused during the check period, as per the charge sheet. This amount is not in dispute.

ii)ITEM No.2:

a)This is leave encashment of Rs.31,407/- received by accused during the check period as per the charge sheet. According to accused, actual amount received by him is Rs.37,340/-.

b)In this connection, prosecution examined P.W.14 and got marked

Exs.P.12 and P.12-A. In chief examination itself P.W.14 admits that total leave encashment received by accused during the check period is Rs.37,400/-.

Even P.W.38/IO also admits the same at Page No.16 of his deposition. A simle glance at page 18 of Ex.P.12-A clearly shows that leave encashment during the check period is Rs.37,340/-.

c)In view of ample evidence on this aspect, income from leave encashment shall be taken as Rs.37,340/- instead of Rs.31,407/-.

42C.C.01/2010/Prl. Spl. CBI Court/VSP iii)ITEM No.3:

a)Rs.82,265/- is shown as arrears of salary received by accused during the check period. According to accused, actual amount received by him in this connection is Rs.1,44,343/-.

b)In this connection, though P.W.14 who issued Ex.P.12-A did not depose anything about his income arrears of salary is mentioned as Rs.1,44,343/- at page no.18 of Ex.P.12-A. In addition to that, P.W.38/IO also admits the said amount in page No.16. Hence, in view of ample evidence, amount of

Rs.1,44,343/- shall be taken into account instead of Rs.82,265/-.

iv)ITEM Nos.4,5 & 8:

These items are not in dispute.

v)ITEM No.9:

a)As per charge sheet Rs.21,149/- is shown as total Income tax refund for the Assessment years 1999-2000, 2000-2001 and 2002-2003. According to accused in total he received Rs.38,150/- towards Tax refunds.

b)In this connection, P.W.38/IO admits at page No.18 that an amount of

Rs.9,420/- and Rs.7,581/- were also credited by Income Tax Department by way of clearing on 9.1.2003 and 13.4.2004 as shown in Ex.P.84. As per charge sheet, Rs.11,111/- in Assessment year 1999-2000, Rs.3,758/- in

Assessment year 2000-2001 and Rs.6,280/- in Assessment year 2002-2003 were received towards Tax refunds. Ex.P.84 Bank account statement shows that accused received Rs.8,420/- and Rs.5,781/- from Income Tax

Department and the same is credited to his account. (Ex.P.84 or P.48).

Hence, as contended by accused entire amount of tax refund shall be taken as Rs.38,150/- instead of Rs.21,149/- as shown in the charge sheet.

vi)ITEM No.13:

43C.C.01/2010/Prl. Spl. CBI Court/VSP

This is an amount of Rs.3,186/- towards interest received on ICICI

Infotech Bonds which is not diputed.

vii)ITEM No.14:

a)This is shown as total agricultural income of Rs.4,06,912/- received by son of accused on Ac.2.25 cents at Kolavennu, wife of accused on Ac.1.00 at

Batlapenumarru and daughter of accused on Ac.1.55 cents of dry land and

Ac.2.25 cents of wet land at Batlapenumarru during the check period.

b)Accused emphatically denied the amount and contends that the total agricultural income received by himself and his family members during the check period is Rs.23,39,073/-.

c)In this connection, Learned Public Prosecutor assiduously argued that though accused received agricultural income on Ac.4.00 of land inherited by him since the same is neither intimated to the department nor shown in IT

Returns, the said income is rightly not taken into consideration.

d)This item is divided into four sub items in the charge sheet. First sub item of land is situated in Kolavennu and remaining 3 sub items are situated in Batlapenumarru village, Krishna District.

i)Sub-Item No.1:

a)This is Ac.2.25 acres of land stood in the name of son of accused at

Kolavennu.

b)Accused denied the income of Rs.2,43,912/- mentioned in this item mainly on three grounds:-

c)Firstly, his son inherited the said extent of Ac.2.25 cents of Kolavennu village in the year 1987 and since then it is being cultivated by accused and deriving agricultural income from two crops per year including the check period; 44C.C.01/2010/Prl. Spl. CBI Court/VSP

d)Secondly, in total thee are eleven crop seasons during the check period;

e)Thirdly, by the end of check period i.e., 31.5.04 in fact production and sale of rabi crop will be over and as such, P.W.10/MRO ought to have calculated agricultural income for rabi crop of fasli 1413 and second crop for eleven seasons during the check period.

f)In this back drop, it is necessary to focus upon the oral testimonies of

P.W.10/MRO and P.W.38/IO.

g)Through P.W.10/MRO Ex.P.32 Pattadar pass book of accused in respect of Ac.4.00 of wet land, Ex.P.33 pattadar pass book in the name of son of accused in respect of Ac.2.25 cents of wet land and Ex.P.34 adangal extracts for fasilies 1403 to 1412 (except fasili 1405 which is not available according to P.W.10) in respect of Sri Ananthaneni Phani Kishore (son of accused),

Ananthaneni Seshagiri Rao and Ananthaneni Venkateswara Rao (accused) were marked. Under Ex.P.34 even statement showing the details of crops raised by accused, his son and his father Seshagiri Rao for fasilies 1403 to 1412 (except 1405) is enclosed. As per Ex.P.34 accused and his son derived annual income of Rs.3,24,680/- and Rs.2,60,618/- respectively (after excluding cultivation expenses) for fasili Nos.1403 to 1412.

h)P.W.10 categorically admits as follows in this connection:

“Two crops will be raised in Kolavennu village of Kankipadu mandal and both crops are wet crops i.e., paddy. Only one crop i.e., Kharif crop income is only mentioned in Statement covered under Ex.P.34 in respect of A. Venkateswara Rao (accused). Tax will be only imposed on wet crops. I cannot say whether Government has collected the tax for two crops or one crop from the accused because I was not there at that particular point of time. ”

i)P.W.38/IO categorically admits as follows:

45C.C.01/2010/Prl. Spl. CBI Court/VSP “It is true that two crops were raised during the check period in agricultural lands of accused and his family members. It is true that basing on information furnished by MRO, I arrived at net agricultural income of Accused and his family members. iIt is true that there were 11 crop seasons during the check period. It is true that accused got

Ac.4.00 of wet land and that was cultivated during the check period and two crosps were raised in each crop season. Though I have calculated total agricultural income of accused, I have not shown in the charge sheet because it doesn't fall under the head of known sources of income.”

j)Regarding Agricultural income from Ac.2.25 cents of land of son of accused, he could not say that there is an error in arriving at total agricultural income and correct amount is Rs.2,60,618/- but not Rs.2,43,912/- for nine kharif seasons.

k)According to the testimony of P.W.38/IO, totally basing on Ex.P.34 i.e., issued by P.W.10/MRO, he calculated agricultural income of accused and his son and though check period consists of eleven crop seasons admittedly only for nine crop seasons, that too on first crop i.e., Kharif crop income is mentioned and income from second crop i.e., Rabi crop is not mentioned in

Ex.P.34 statement or in the charge sheet.

l)Though P.W.10/MRO deposes that son of accused derived Rs.2,60,618/- towards income for first crop of nine fasilies, it is wrongly shown as

Rs.2,43,912/- in charge sheet and as such the said amount of Rs.2,60,618/- shall be treated as agricultural income of son of accused for Kharif crop of nine seasons. In view of these admissions of P.W.10/MRO and P.W.38/IO, if same income shown in Ex.P.34 for fasilies 1403 and 1412 is applied for fasli 1405 and one more khariff crop, it comes to Rs.16,706/- and Rs.24,300/- and total income for kharif crop in check period comes to Rs.3,01,624/-.

m)Admittedly, since two crops were raised for eleven seasons income from second crop for eleven agricultural seasons shall be considered.

46C.C.01/2010/Prl. Spl. CBI Court/VSP

n)Defence Evidence:

In respect of the second crop and income there from, accused examined D.Ws.2 and 4. D.W.2 deposed that he worked as agricultural coolie under father of accused and after his death under accused in his lands at Kolavewnnu and two crops were raised in lands of accused at Kolavennu and second crop is black gram and yield per crop during the season was 5 to 8 bags at 100 kgs., per bag per acre and rate of each bag was Rs.1500/- per bag in 1994 and later it became Rs.5 to 6 thousand by 2005 and expenditure per acre of black gram will be two bags.

o)D.W.4/Marketing Assistant in Agricultural Market Committee,

Nandigama deposed about the rates of Black gram. Though Assistant

Director of Agricultural Market Committee was summoned to produce list of minimum support price for paddy and black gram from 1993-94 to 2003-04 i.e., for entire check period, only prices for paddy and black gram for 2003- 04 was produced by clearly mentioning that rest of the record is not available. Hence, accused made all efforts to examine witness and produce evidence regarding yield and rate.

p) According to D.W.4, the rate of black gram in 2003-04 was Rs.1370/- per quintal and same is reflected in Ex.X.2 (list of MSP to paddy and blackgam fixed by Government) on an average. If average yield for eleven crop seasons on Ac.2.25 cents as deposed by D.W.2 is taken, it would be 123.75 quintals at the rate of 11.25 quintals per season for Ac.2.25 acres.

q)D.W.2/Agricultural coolie deposed that cost of two quintals of black gram would be spent for expenditure per acre. Hence, out of total yield of 123.75, if expenditure at the rate of 2 quintals per acre for 11 crop seasons on Ac.2.25 cents that is deducted net yield comes to 74.25 quintals.

47C.C.01/2010/Prl. Spl. CBI Court/VSP

r)Apropos the rate per quintal, the name of Ex.X.2 list itself that is minimum support price list fixed by Government itself indicates that they are minimum rates and one should not sell or purchase agricultural produce less than the said rates and it is a protection given to farmer. Even D.W.4

Marketing Assistant from Agricultural Market Committee deposed that market rates will be more than the MSP rates fixed by court. From the testimony of D.W.2 and Ex.X.2 if average rate per quintal is taken as

Rs.1500/-, net income on 74.25 quintals comes to 74.25 x 1500 i.e.,

Rs.1,11,375/-. Hence, Rs.1,11,375/- shall be taken as net income for 11 rabi crops during check period.

ii)Sub-Item No.2:

a)It is Ac.1.00 of land in the name of wife of accused in Batlapenumarru village allegedly purchased in 2002 and shown as 11th item in Statement-‘B’ and income is shown as Rs.16,000/- in the charge sheet. The net income for two years for two kharif seasons is in fact shown as Rs.16,000/- in this item.

There is no dispute regarding the same except for not adding income on rabi crop though black gram was raised.

b)In this connection P.W.6 at page No.3 deposed that earlier he was an agriculturist and wife of accused is his elder sister and there is Ac.5.00 of wet land in the name of wife and daughter of accused at Batlapenumarru village in addition to one and half acres of dry land in the same village and he has been cultivating the same since the purchase of Ac.5.00 and Ac.1.50 and paddy and black gram used to be raised as first and second crops in Ac.5.00 of wet land and whenever paddy is raised it used to give an yield of 40 bags of 76 kgs., per bag per acre and only 16 bags per acre per year will be spent for cultivation expenses and whenever black gram is raised it gives an yield of 8 to 9 bags of 100 kgs., per acre per year and expenditure for raising black 48C.C.01/2010/Prl. Spl. CBI Court/VSP gram will be two bags per year and accused raised two crops per year in the said five acres of wet land from 1994 to 2004.

c)As deposed by P.W.6 for two crop seasons if eight bags per acre is taken into consideration as yield it comes to 16 bags (8x2) and two bags per each crop to be deducted towards expenditure and therefore, net yield would be 12 bags of income . If average rate per bag is taken as Rs.2,000/- (since the said rate is for 2002-03 and 2003-04) total amount of Rs.24,000/- (12 bags x 2000) shall be treated as net income for rabi crop but not Rs.16,000/- as mentioned in the charge sheet.

iii)Sub-Item No.3:

a)It is Ac.1.55 cents of dry land in the name of daughter of accused in

Batlapanumarru. Income during check period is shown as Rs.63,000/- in the charge sheet.

b)As mentioned supra, IO calculated income on this extent for nine seasons though admittedly there are eleven seasons during the check period. Hence, income for eleven seasons for Khariff crop at same rate comes to Rs.1,02,300/-. Be that as it may IO did not give income for second crop on this land though he admits that 2 crops are raised in the lands of accused and his family members. If yield of black gram for second crop per year for eleven crops is taken into consideration at the rate of 12.4 quintals as mentioned in sub-items 1 and 2 total yield during check period will be 136 quintals, expenditure will be 31 quintals and net yield will be 102.3 quintals.

At the rate of Rs.1,500/- per quintal on an average the net income comes to

Rs.1,53,450/- and the same shall be treated as total income of daughter of accused instead of Rs.63,000/- mentioned in the charge sheet.

iv) Sub-Item No.4:

49C.C.01/2010/Prl. Spl. CBI Court/VSP

a)This item is Ac.2.25 cents of land at Batlapenmarru village in the name of daughter of accused. Income during the check period is shown as

Rs.84,000/- in charge sheet.

b)The defence version is though daughter of accused owns Ac.4.00 of agricultural land in Batlapenumarru village, IO calculated income for Ac.2.25 cents only as Rs.84,000/- and according to P.W.19/MRO it is wet land and average annual income per Ac.1.00 after deducting all expenses is Rs.8,000/- and as such for Ac.4.00 at the rate of Rs.8,000/- per crop income comes to

Rs.32,000/- per year and for eleven crops total income for kharif crop comes to Rs.3,52,000/- which shall be treated as income instead of Rs.84,000/-.

c)Regarding Rabi crops learned counsel for accused canvassed that black gram was cultivated as rabi crop in these land and income from rabi crop is not shown by I.O.

d)In the light of the aforementioned submissions, a careful scrutiny of material on record including testimony of P.W.19/MRO and P.W.6/brother of accused leaves no doubt that daughter of accused got four acres of wet land in Batlapenumarru in addition to Ac.1.55 cents of dry land (Sub-item 3) in that village I.O., has shown income from Ac.2.25 cents only as Rs.84,000/- instead of income from four acres. If net income of Rs.8,000/- per acre, as mentioned by P.W.19/MRO, is taken into consideration for 4 acres it comes to

Rs.32,000/- per year and total net income for 11 khariff crops will be

Rs.3,52,000/-. Hence, instead of Rs.84,000/-, Rs.3,52,000/- shall be treated as total income from 1st crop.

e)Since income from 2nd crop i.e., black gram is not taken into consideration by I.O., as contended at the rate of 32 quintals on Ac.4.00 cents per season for eleven seasons it comes to 352 quintals and after deducting the total expenditure of 88 quintals the net yield will be 264 quintals. On an average at Rs.1500/- per quintal total income of 264 quintals 50C.C.01/2010/Prl. Spl. CBI Court/VSP will be Rs.4,46,000/-. This amount of Rs.4,46,000/- shall be treated as income from 2nd crop.

viii)ADDITIONAL INCOME ON LAND OF ACCUSED DURING THE CHECK PERIOD:

a)Learned counsel for accused urged that admittedly accused inherited ancestral agricultural land of Ac.4.00 in Kolavennu village which is shown as item no.1 in both Statements ‘A’ & ‘B’ and P.W.38 also admits that accused got this land and cultivated the same during the check period and two crops were raised in each season and though he admittedly calculated total agricultural income of accused on that land on par with income shown in sub-item No.1 of item No.14 it is not considered and as such, same rate and yield is to be applied for Ac.4.00 of land of accused also.

b)Accused has clearly shown entire agricultural income of himself and his family members for both crops in check period as Rs.23,39,073/- in table in written arguments.

c)Prosecution did not consider this income on two grounds. Firstly, it is not reflected in IT returns.

d)Secondly, Accused is duty bound to inform his department regarding the income derived from any source as per Rule 16(A) of General Insurance (conduct, discipline and Appeal) Rules, 1975 but accused neither informed his Department nor shown the agricultural income in IT returns and as such, it cannot be considered.

e)In the light of this it is necessary to focus upon relevant portion of Rule 16(A) incorporated vide Circular No.PERS-MPL/HO/21/2000 dated 17.8.2000 which reads as follows:

Rule 16(A) Clause 6:

51C.C.01/2010/Prl. Spl. CBI Court/VSP “Every employee shall report in the prescribed format to the competent authority all transactions concerning movable property owned or held by him in his own name or in the name of a member of his family if the value of such movablepropertyexceeds

Rs.25,000/-. Such returns shall be filed within 30 daysofthe transaction.”

f)The aforementioned clause is simply about filing reports in prescribed formats about transactions concerning movable property exceeding value

Rs.25,000/-. On the face of it, clause 6 do not relate to immovable property.

We are only on the point whether agricultural income which is generated from immovable property (agricultural lands) shall also be reported to the department.

g)On the other hand, the purport of clause (6) is only in respect of transactions concerning movable property owned or held by the employee.

Realizing agricultural income do not in any way constitute “transactions concerning movable property”. There is no specific mention of word income from immovable property in Rule 16(A) relied upon by prosecution. Hence, as contended by the accused Rule 16(A) clause 6 doesn't specifically obligates the accused to report agricultural income.

h)Further, prosecution did not make endeavour to show what is the prescribed format regarding the disclosure of agricultural income from lands.

i)On the other hand, P.W.38/IO admits that in proforma of APRs., there is no column to show income from the properties derived by employees.

j)At this juncture, it is apt to look into the ruling of Apex Court in Ashok

Tshering Bhutia V. State of Sikkam reported in 2011 (4) Supreme

Court cases wherein the Lordships erudite as follows:

“Not filling up the form under the mandatory requirement of Rule 19 of Rules 1981 may render the appellant liable for disciplinary proceedings under service jurisprudence, but that itself cannot be a 52C.C.01/2010/Prl. Spl. CBI Court/VSP ground for rejection of the said documents in toto without examining the contents thereof. In this regard, we are of the considered view that the courts below have committed a grave error and the contents thereof should have been examined.

The contention of the respondents regarding non compliance of t he

Rules 1981 adversely affecting the evidentiary value of Ex.D-4 must be rejected for at least two reasons; iii)The Rules 1981 are not rules of evidence. This admissibility and probative value of evidence is determined under the provisions of the Indian Evidence Act, 1872. These rules are merely service rules by which government servants in Sikkim are expected to abide. Consequently, the respondent has not been able to provide any cogent reason why the contents of Ex.D.4 should be disregarded; and iv)Rule 19(i)(a) of the Rules, 1981 does undoubtedly require government servants to on first appointment to any service or post and thereafter at the close of every financial year submit to the government the return of their assets and liabilities.

However, it is to be noted that the said rule envisages that public servants will submit such returns in a prescribed form.

Despite being repeatedly questioned by this Court, the respondents were unable to produce such form. Thus, it cannot be said that the appellant did not comply with the said rule as in the absence of such a form it was impossible for him to have done so (through no fault of his own). In any event, failing to submit such returns even if there had been no such a form, would make the appellant liable to face the disciplinary proceedings under the service rules applicable at the relevant time. The provisions of the Rules 1981 cannot by any stretch of imagination be said to have the effect of rendering evidence inadmissible in criminal proceedings under the P.C. Act, 1988.

Thus, in such a fact situation, the appellant could not be fastened with criminal liability for want of compliance of the said requirement of the Rules.”

k)Hence, as per the aforementioned observations relied upon by the accused non filling of the form under mandatory requirement of the Service 53C.C.01/2010/Prl. Spl. CBI Court/VSP

Rules of Public Servant may render the appellant liable for disciplinary proceedings under Service Jurisprudence but that by itself cannot be a ground for rejection of the documents in toto without examining the contents as observed in para 36 of the Judgment. Further in para 44 of the Judgment

Apex Court observed as follows:

“No doubt prosecution has to establish that the pecuniary assets acquired by the public servant are disproportionately larger than his known sources of income and then it is for the public servant to acount for such excess. The offence becomes complete on the failure of public servant to account for or explain such excess”.

l)The aforementioned detailed observations made by Apex Court in the said case squarely applies to the case on hand. As mentioned supra, prosecution did not place on record the prescrbied proforma of APRs., to show that it mandates the reporting of agricultural income. Further, the aforementioned Rule 16(A) is not a rule of evidence. Admissibility and probative value of evidence is determined under the provisions of Indian

Evidence Act, 1872. Since these rules are merely service rules expected to be followed by employees of General Insurance Companies breach of any such rule would make employee liable to face the disciplinary proceedings under the service rules applicable at the relevant time. But these rules cannot by any stretch of imagination affect or cause or render the evidence inadmissible in criminal proceedings under P.C. Ac. 1988. Hence, accused cannot be fastened with criminal liability for want of compliance of Rule 16(A).

m)Further turning to the allegation of not showing agricultural income in

Exs.P.13 to P.15 income tax returns, P.W.5 chartered accountant who prepared and filed these returns admits that if other income of individual is taxable then only agricultural income will be taken into consideration for calculating tax and if other than agricultural income is not taxable, no 54C.C.01/2010/Prl. Spl. CBI Court/VSP separate tax will be levied on agricultural income. He further admits that income tax assessee need not declare his agricultural income in his individual tax assessment if agricultural income is inherited by him and if the same is shown in HUF Income tax assessment. At page no.4 P.W.5 admits that HUF IT return of accused for assessment year 2004-05 disclose that he declared agricultural income received by him along with income from other sources

n)He further admits that under Ex.P.15 IT return for Assessment year 2004-05 wife and son of accused also disclosed on agricultural income.

o)A careful scrutiny of page No.15 of Ex.P.15 (HUF return) clearly shows declaring of agricultural income on Ac.4.00 of land inherited by accused.

Under Exs.P.13 and P.14 IT returns there is no HUF IT Return. Only in Ex.P.15 there is HUF return clearly showing the agricultural income of accused as well as his family members. Hence, it is not that in IT returns accused had never shown agricultural income. Material on record clearly shows that father of accused is an agriculturist and accused and his son also inherited joint family lands way back in 1974 and since then accused has been cultivating the same and realizing income there from and it is biggest source of income of accused. There is no dispute that the total family of accused comprising accused, his wife, son and daughter got nearly 13 acres of land and it is a big source of income. By no stretch of imagination it can be said that agricultural income is not lawful source or income.

p)Interestingly, IO failed to consider agricultural income only on Ac.4.00 of land inherited by accused though he had taken agricultural income on the remaining extent of land out of Ac.13.00. When accused has not shown agricultural income of even his family members to the Department what is the logic behind considering agricultural income of wife, daughter and son of 55C.C.01/2010/Prl. Spl. CBI Court/VSP accused leaving the agricultural income of accused though it is calculated as per the details furnished by P.W.10/MRO is not known.

q)Though admittedly accused owned this ancestral land of 4 acres at

Kolavennu and declared to the Department at no point of time according to the material on record department either questioned him or issued memo seeking explanation regarding non intimation of agricultural income. By no stretch of imagination it can be said income from lands is either wind full or unlawful.

r)Hence, for the aforementioned reasons there cannot be any hesitation to hold that agricultural income of accused being lawful source of income shall be taken into consideration.

s)Regarding income from 1st crop, P.W.10/MRO at page No.2 of chief examination deposed that as per Ex.P.34 accused and his son derived annual income for Fasili 1403 to 1412 except 1405 as Rs.3,24,680/- and

Rs.2,60,618/- respectively after excluding cultivation expenses. If the same rate is applied total income for eleven fasilies for Kharif crop alone comes to

Rs.3,97,880/-.

ix)QUANTIFYING AGRICULTURAL INCOME OF ACCUSED:

a)Admittedly accused acquired this Ac.4.00 of land under partition deed

dated 15.5.74 and shown in the charge sheet as item No.1 in both

statements ‘A’ & ‘B’.

b)Outcome of the aforementioned discussion is total income under four sub-items of item No.14 + Addl. Agricultural income on 4 acres of accused is

Rs.21,02,798/-as shown in the following table. This amount shall be taken into consideration as agricultural income instead of Rs.4,06,912/- shown in item no.14.

56C.C.01/2010/Prl. Spl. CBI Court/VSP

c)P.W.38/IO, as mentioned supra, admits raising of two crops in all lands and as such income derived from second crop (black grams) also to be considered for eleven rabi crop seasons and for eleven seasons yield for

Ac.4.00 comes to 220 quintals and after deducting 88 quintals towards expenditure (@ 2 bags per acre per year) net yield comes to 132 quintals and net income comes to Rs.1,98,000/- at the rate of Rs.1,500/- per quintal.

Therefore, total income during the check period is Rs.3,97,880/- (first crop eleven seasons) plus Rs.1,98,000/- (second crop eleven seasons) is

Rs.5,95,880/- which is the net agricultural income of accused.

TABLE

NameAs per charge sheetAmount considered by Court KharifRabiTotalKharifRabiTotal

1. Son of accused 243120243912301793111375413168 Ac.2.25 cents in Kolavennu

2. Wife of accused 16000016000160002400040000 Ac.1.00 in Batlapenumarru

3. Daughter of accused 63000063000102300153450255750 Ac.1.55 cents in Batlapenumarru

4. Daughter of accused 84000084000352000446000798000 Ac.2.25 cents as per accused. Ac.4.00 as per accused in Batlapenumarru

5. Accused Ac.4.00 in 000397880198000595880 Kolvennu Total4069120406912116997932825210279 38

x)ITEM No.15:

This item is shown as Rs.45,675/- towards maturity amounts received from five NSC bonds, as shown in the charge sheet, during the check period.

There is no dispute regarding this item.

57C.C.01/2010/Prl. Spl. CBI Court/VSP xi)ITEM No.16:

a)Rs.1,25,000/- is shown as total amount of seven crop loans received by accused and his son during the check period.

b)The defence version is accused and his family members availed 12 agricultural loans but not seven as shown in the charge sheet and P.W.38/IO admits that he had not shown four crop loans availed by accused and one crop loan availed by his son as income.

c)In this connection, prosecution examined P.W.38 and got marked

Ex.P.69. Ex.P.69 shows all the twelve loans as claimed by accused. Even

P.W.38/IO admits the five loans availed by accused and his family members were not shown in the charge sheet. He further admits that four crop loans availed by accused were repaid subsequent to the check period. Hence, accused clearly proved the availing of five more loans as shown in Ex.P.69 and as such, total amount of 12 loans i.e., Rs.2,52,000/- shall be treated as income instead of Rs.1,25,000/- for seven loans.

d)Total amount of items 1 to 16 of Statement-‘C’ as mentioned supra comes to Rs.39,80,025/-.

xii)Net result of the aforementioned discussion is mentioned as under:

STATEMENT-C

(INCOME RECEIVED BY THE ACCUSED DURING THE CHECK PERIOD)

ItemDescription of theAs per IOAs perValue No. asincomeRs.accusedconsidered perRs.by Court chargRs. e sheet.

1.Total Net salary8,29,9348,29,9348,29,934

2.Leave Encashment31,40737,34037,340

3.Salary arrears82,2651,44,3431,44,343

4.Profit linked incentive3,5993,5993,599

5.Housing loan3,00,0003,00,0003,00,000

8.Loantowards2,23,0002,23,0002,23,000 58C.C.01/2010/Prl. Spl. CBI Court/VSP construction of house

9.IT Returns21,14938,15038,150

13.Intereston3,1863,1863,186 investment

14.Agricultural income4,06,91223,39,07321,02,798

15.Income received on45,67545,67545,675 NSCs.

16.Crop loans1,25,0002,52,0002,52,000 Total20,72,12742,16,30039,80,025

21.ADDITIONAL INCOME ACCORDING TO ACCUSED DURING THE CHECK PERIOD:

Accused contend that several items of income received by him are not shown in the charge sheet and they are mentioned in detail in written arguments as Item Nos.1 to 18. Accused also mentioned additional income in tabular form in the written arguments. The said items are discussed in seriatum as under:

i)ITEM NO.1:

According to accused he received total PF loan amount of Rs.1,44,500/- from his Department during the check period and the same is reflected in

Ex.P.12-A. As contended by accused Ex.P.12-A reflects the said amount. In addition to that P.W.38/IO also admits the same at page No.18. Hence, the said amount of Rs.1,44,500/- shall be treated as income of accused.

ii)ITEM NO.2:

According to accused, he availed vehicle loan of Rs.16,830/- during the check period and Ex.P.12-A reflects the same. As contended by accused in addition to the reflection of this amount in Ex.P.12-A, P.W.38 also admits the same at page 16. Hence, Rs.16,830/- shall be taken into consideration as the income of accused.

iii)ITEM NO.3:

59C.C.01/2010/Prl. Spl. CBI Court/VSP

Accused contend that he availed festival and flood advances of

Rs.60,300/- during the check period and same is reflected in Ex.P.12-A. As contended Ex.P.12-A reflects the same and in addition to that P.W.38 also admits the same. Hence, Rs.60,300/- shall be treated as income of accused.

iv)ITEM NO.4:

Accused contends that he received Rs.1,000/- towards marriage grant on the occasion of marriage of his daughter during the check period and same is reflected in Ex.P.89. As contended by accused, Ex.P.89 reflects the same. In addition to that P.W.38/IO at page No.16 admits the same. Hence,

Rs.1,000/- shall be treated as income of accused.

v)ITEM NO.5:

Accused contend that he received Rs.1,13,899/- and Rs.82,208/- from

M/s.Sri Satyanarayanaswamy Auto Finance Company, Vijayawada, on 25.9.94 and 30.7.94 on maturity of F.D.Rs., and the same is reflected in Ex.P.12. As contended by accused, Ex.P.12 reflects the same and P.W.38/IO at page

No.17 admits that as per Ex.P.12 accused received the said two amounts under cheques. Hence, the said amount of Rs.1,96,107/- shall be treated as income of accused.

vi)ITEM NO.6:

According to accused during the check period, he received Rs.78,000/- from UTI on maturity of ULIP Bonds. As contended by accused, even

P.W.38/IO admits at page No.17 that the said amount was received as per statement. Hence, Rs.78,000/- shall be treated as income of accused.

vii)ITEM NO.7:

60C.C.01/2010/Prl. Spl. CBI Court/VSP

a)Accused contend that he obtained eight loans for total amount of

Rs.2,27,700/- from General Insurance Employees Co-operative Thrift and

Credit society Limited, Vijayawada.

b)In cross examination P.W.35 admits at page 2 that as per Ex.P.71 accused received loan amount of Rs.2,27,700/- between 9.12.94 to 3.11.03.

Even IO admits the same at Page no.17. Hence, the said amount of

Rs.2,27,700/- shall be treated as income of accused.

viii)ITEM NO.8:

a)According to accused he availed five loans for total amount of

Rs.1,66,751/- from New India Assurance Employees Co-operative Thrift and

Credit Society Limited, Chennai. In this connection, P.W.38/IO at page No.18 admits that availing of the said amount was reflected at page No.5 of

Ex.P.18.

b)In view of this admission, the said amount of Rs.1,66,751/- shall be treated as income of accused.

ix)ITEM NO.9:

Accused contend that he obtained loan amount of Rs.30,000/- from

IOB, Vijayawada, on 22.12.202 during the check period. In this connection,

P.W.12 deposed that the said amount of Rs.30,000/- was availed by accused for purchase of computer as per Ex.P.36 Statement. In addition to that

P.W.38/IO admits at page No.18 about the availing of this loan by accused.

Hence, this amount of Rs.30,000/- shall be treated as income of accused.

x)ITEM NO.10:

a)Accused contend that during the check period he obtained three gold loans of Rs.25,000/-, Rs.16,000/- and Rs.24,000/-, totalling to Rs.65,000/-, on 13.11.2002, 21.11.2000 and 24.12.1999 respectively from SBI, Kankipadu 61C.C.01/2010/Prl. Spl. CBI Court/VSP branch. P.W.32 was examined and Exs.P.65 to 67 were marked to prove the same. P.W.32 deposed that accused was sanctioned a gold loan of

Rs.25,000/- on 13.11.2002 and Ex.P.65 relates to the said loan statement of accused and accused repaid the loan amount and it was closed on 13.12.2004. He further deposed that accused also availed gold loan of

Rs.16,000/- on 21.11.2002 from the same Kankipadu branch and Ex.P.66 is

Statement of account relating to that loan and accused repaid the said loan and account was closed on 23.10.2002. He also deposed that accused availed another loan of Rs.24,000/- on 24.12.1999 and repaid the loan amount and account was closed on 21.11.2000 and Ex.P.67 is the statement of account relating to that loan.

b)P.W.38/IO also admits the availing of said three gold loans at page 18 during the check period. Hence, total gold loan amount of Rs.65,000/- shall be taken as income of accused.

xi)ITEM NO.11:

Accused contend that during the check period he obtained a loan of

Rs.1,00,000/- from UCO Bank, Venkateswarapuram Branch. In this connection, P.W.16 deposed in chief examination that there was a credit of

Rs.1,00,000/- towards the said loan into the account of acccused as per

Ex.P.40 on 25.2.2003. P.W.38/IO admits the same at page No18. Hence, this amount of Rs.1,00,000/- shall be taken as income of accused.

xii)ITEM NO.12:

According to accused he and his wife and children received

Rs.8,00,140/- in total from Margadarsi Chit Fund Company Limited towards bid amounts through cheques during the check period. P.W.26 was examined in that connection and Ex.P.58 was marked. P.W.26 admits the same. In addition to that P.W.38/IO also admits the receipt of the amount of 62C.C.01/2010/Prl. Spl. CBI Court/VSP

Rs.8,00,140/- towards bid amount under six chits of Margadarsi during the check period. Hence, Rs.8,00,140/- shall be treated as income of accused.

xiii)ITEM NO.13:

According to accused he obtained loan of Rs.8,76,210/- from HDFC

Bank, Vijayawada. In this connection P.W.15 deposed in chief examination that Ex.P.39 statement of account contains total withdrawal amount of

Rs.8,76,210/- during the check period. P.W.38/IO at page no.22 also admits the receiving of loan from HDFC Bank, by accused to the extent of

Rs.8,76,210/- during check period under Ex.P.39. Hence, the said amount of

Rs.8,76,210/- shall be treated as income of accused.

xiv)ITEM NO.14:

Accused contend that during the check period he and his wife sold the shares and received income out of the same and the said transaction is reflected in Ex.P.15.

In this connection, P.W.5/Auditor deposed that accused received

Rs.42,311/- during the Assessment year 2004-2005 and Rs.3,500/- towards dividend amount and his wife received Rs.2,750/- towards sale of shares and

Rs.2,740/- towards dividend and his son received Rs.6,983/- towards sale of shares and Rs.2080/- towards dividend and total comes to Rs.84,664/-.

P.W.38 also admits receipt of the said amount by accused as per HUF return for Assessment year 2004-05. Hence, the said consolidated amount of

Rs.84,664/- shall be treated as income of accused.

xv)ITEM NO.15:

a)Accused contend that he borrowed Rs.20,000/- from A. Ramarao,

Rs.25,000/- from V.Prakash, Rs.17,500/- from L. Lokeswara Rao and in total

Rs.62,500/- was borrowed.

63C.C.01/2010/Prl. Spl. CBI Court/VSP

b)In this connection, P.W.5/Auditor deposed in chief examination that IT returns of accused in respect of 2002-2003 was filed on 31.7.2002 and accused claimed hand loans of Rs.17,500/- from L. Lokeswara Rao,

Rs.25,000/- from V. Prakash and Rs.20,000/- from A.Ramarao and this is reflected in Ex.P.15 Income Tax returns. In addition to that P.W.38/IO at page

No.19 also admits the same.

c)In view of this, Rs.62,500/- shall be taken as income of accused.

xvi)ITEM NO.16:

a)Accused contend that he received Rs.24,000/- towards House rent on

Item No.9 Asset and same is reflected in Ex.P.60 and P.W.5 also deposed the same.

b)In this connection, P.W.5 admits that Ex.P.15 Individual Tax returns of

Accused for Assessment Year 2004-2005 shows that accused declared rental income to the extent of Rs.24,000/-. Even P.W.38/IO admits the same at page

No.19.

c)In view of this, Rs.24,000/- shall be treated as income of accused.

xvii)ITEM NO.17:

a)Accused contend that his mother gifted Rs.1,00,000/- at the time of marriage of his daughter.

b)In support of the same, accused examined his mother aged 84 as

D.W.1 and she deposed in chief examination about the said gift made at the time of marriage of daughter of accused. She further deposed that she along with her husband presented one Vaddanam each to her grand daughters’ including the daughter of accused at the time of their marriages and her husband got 32 acres of land. The aforementioned testimony of D.W.1 shows the financial capacity of her family. Be that as it may, it is well established 64C.C.01/2010/Prl. Spl. CBI Court/VSP legal proposition that accused need not prove his defence beyond reasonable doubt. In cross examination of D.W.1 nothing against the accused was elicited. There is nothing on record to discredit her testimony. In those circumstances there is no reason to discredit the testimony of D.W.1 regarding gift of Rs.1,00,000/- to her grand daughter.

xviii) ITEM NO.18:

a)Accused contends that his brother-in-law gifted Rs.50,000/- to accused on the occasion of marriage of his daughter and accused borrowed Rs.1 lakh from P.W.6 in August, 2002.

b)In this connection, P.W.6 i.e., brother-in-law of accused admits the gift of Rs.50,000/- in cash to accused on behalf of his family at the time of marriage of daughter of accused and he lent Rs.1 lakh one month prior to the marriage for marriage expenses.

c)It is quite natural to borrow amounts from the close relatives for marriage expenses of daughters. Further, it is also natural for a brother-in- law who is a close relative to give gift according to their capacity in such marriages. P.W.6 is admittedly own brother of wife of accused. Hence, there is no unnaturality in giving gift and lending amount to accused.

d)In view of this admission, Rs.1,50,000/- shall be treated as income of accused.

xix)ITEM No.19:

a)According to accused P.W.6 repaid Rs.1 lakh to accused towards the amount due under Exs.P.16 to P.19 pronotes, P.W.7 repaid Rs.75,000/- towards the amount due under Exs.P.22 to P.24 pronotes, P.W.8 repaid

Rs.59,000/- towards amount due under Ex.P.20 pronote and P.W.9 repaid

Rs.1,25,000/- towards the amount due under Exs.P.27 to P.30 pronotes to 65C.C.01/2010/Prl. Spl. CBI Court/VSP accused and his wife and claimed in total income of Rs.3,59,000/-. As contended by accused the testimonies of P.Ws.6 to 9 clearly shows the repayment of amount due under Exs.P.16 to P.19, P.22 to P.24, P.20 and P.27 to P.30 respectively. Hence, this amount of Rs.3,59,000/- shall be taken as income of accused as contended.

b)Except items 17 and 18 , rest of the amounts of Addl. Income are well reflected in the documents filed by prosecution itself. On the face of these unassailable documents and discussion on items 18 and 19 all the items are proved.

c)As mentioned supra the total amount of Addl. income under items 1 to 19 is Rs.29,39,595/-. Total income i.e., Statement-C + Addl. Income

Rs.39,80,025/- + Rs.35,42,702/- = Rs.75,22,727/-.

d)Sum and substance of the aforementioned findings are reflected as follows:

ADDITONAL INCOME RECEIVED DURING THE CHECK PERIOD

ItemName of the AssetAs per IOAs perValue No. asRs.accusedconsidered perRs.by Court chargeRs. sheet

1. PF Loan01,44,5001,44,500

2.Vehicle loan amoun016,83016,830

3.Flood and Festival 060,30060,300 advance received

4.Marriage grant01,0001,000

5.FDR amounts recd. 01,96,1071,96107 from Sree Satyanarayana Swamy Auto Finance Co.

6.Maturity of ULIP 078,00078,000 bonds

7.Amount of loan 02,27,7002,27,700 availed from Gen. Insurance Emp. Co- op. thrift & Credit society Ltd., Vijayawada

8.Amount of loan 01,66,7511,66,751 66C.C.01/2010/Prl. Spl. CBI Court/VSP availed from New India Assurance Co. Ltd. Emp. Co-op. thrift & Credit Society

9.Consumer loan 030,00030,000 amount recd. From IOB, Vijayawada

10.Gold loan amount 065,00065,000 recd. from SBI

11.Pesonal loan amt. 01,00,0001,00,000 recd. from UCO Bank

12.Amt. recd., from 08,00,1408,00,140 Margadarsi Chit Fund Ltd

13.Net outstanding loan02,73,1038,76,210 amount due to HDFC Bank

14.Interest, Profit on 084,66484,664 sale of shares, Dividend amts., recd. during the Assessment year 2004-05

15.Amts., borrowed 062,50062,500 during Assessment year 2003-04

16.House rent recd. 024,00024,000 During the Assessment year 2004-05

17.Cash gift by mother 01,00,0001,00,000 of accused

18.Cash gifts recd., on 01,50,0001,50,000 the occasion of marriage of A. Sunitha during the year 2002

19.Amt. recd., from the 03,59,0003,59,000 borrowers Total029,39,59535,42,702

TOTAL INCOME

Statement-C Income during the 39,80,025 check period

Additional Income received during 35,42,702

the check period Total75,22,727 67C.C.01/2010/Prl. Spl. CBI Court/VSP

22.STATEMENT-D EXPENDITURE DURING THE CHECK PERIOD:

i)ITEM NO.1:

a)This item is net expenditure on residence telephone bills i.e.,

Rs.64,087/- from 1.5.95 to 7.7.04.

b)To prove the said expenditure, prosecution did not examine BSNL officials but Ex.P.80 statement was marked through P.W.38/IO.

c)Accused contend that mere marking of Ex.P.80 statement without examining BSNL officials and production of primary evidence like telephone bills and account books to show the said payment do not constitute proof of the said payment of bills and as such this item is liable to be deleted for non proving the same through competent person.

d)In this connection, Exs.P.80 and P.94 show computer statements regarding the residence telephone bills of accused. In charge sheet itself it is specifically mentioned that amount reimbursed by Department has been deducted. A simple glance at Ex.P.80 shows that it is a letter written by

Accounts Officer, BSNL to IO, enclosing the payment details in respect of the residence telephone number of accused. In enclosure to this letter details of dates of all bimonthly bills from 1995 till 7.7.2004, amount covered under these bills and dates of payment are clearly mentioned. This is not a computer generated statement on the face of it and it is only xerox copy of manual details given by the competent officer i.e., Accounts Officer of BSNL.

e)Ex.P.94 is the letter addressed by BSNL to Inspector CBI furnishing details of residence telephone bills of accused during the check period. The details of bills downloaded from Computer system were enclosed along with this letter.

68C.C.01/2010/Prl. Spl. CBI Court/VSP

f)Inspite of Exs.P.80 and P.94 containing all the details of bills and date of payment, accused did not come forward with any evidence contrary to the said details or raised any version explaining that in what way the amount and payment particulars are incorrect and what are the correct particulars according to him. He did not deny the residence telephone connection in his name. Hence, since it is an admitted fact that accused is provided with residence telephone connection, there cannot be any doubt about payment of telephone bills also by the accused. When IO fairly mentions that the amount reimbursed by Department out of the telephone bill is deducted and remaining amount is only mentioned in this item, accused ought to have come forward with his own version in this connection. Prosecution has sufficiently proved this item. Onus shifts to the accused to prove otherwise.

Though he need not prove beyond doubt he must adduce defence evidence showing probabilities in his favour. Instead of attacking evidence, raising only contention of non examination of author of Ex.P.80 without putting forth his version when admittedly he availed the facility of the telephone number during the check period goes to show that the details mentioned in Ex.P.80 are correct. Hence, the entire amount of Rs.64,087/- mentioned in this item is taken as correct.

ii)ITEM No.2:

a)This item is Rs.41,500/- regarding the amount spent on education of son of accused.

b)In this connection, prosecution examined P.W.25, P.W.29 and P.W.38 and got marked Exs.P.57, P.61 and P.86.

c)Accused disputed this item.

d)This item is divided into three sub-items.

i)Sub Item No.1:

69C.C.01/2010/Prl. Spl. CBI Court/VSP

a)This item is Rs.8,500/- allegedly paid in Kennedy High School, M.G.

Road, Vijayawada. To substantiate the same, P.W.29 was examined and

Ex.P.61 was marked. According to P.W.29 income tax Department conducted raids in the said school in the year 1995 and all the documents were seized and as such he did not possess original receipt. Ex.P.61 marked through

P.W.29 is a letter addressed by Principal of Kennedy High School to the

Inspector, CBI, stating that accused paid Rs.4,000/- and Rs.4,500/- for fee towards academic years 1994-95 and 1995-96 with regard to the education of son of accused namely Phani Kishore in that school.

b)P.W.29 is not simply present staff of the school. On the other hand, he has been working as Principal of Kennedy High school since 1985 and deposed that son of accused studied 9th and 10th classes in that school. He denied the suggestion that only under the pressure of CBI he issued Ex.P.61 and the details of fee mentioned by P.W.29 in Ex.P.61 are incorrect. Nothing prevented the accused from giving the correct particulars if really particulars in Ex.P.61 are incorrect. There is absolutely no necessity for principal to depose falsely regarding the fee paid simply for two years.

c)It is not the case of accused that his son did not study in the said school at all or he studied freely without any fees. Hence, in the absence of any evidence to the contra it cannot be said that the fee particulars mentioned by P.W.29 are incorrect simply because P.W.29 could not produce original receipts on the ground that Income Tax Department seized the documents in raid. Hence, Rs.8,500/- shall be taken into consideration.

ii)Sub-Item No.2:

a)It is fee of Rs.25,000/- allegedly paid by accused in M/s.Triveni Arts

College, Patamata, Vijayawada, during the period 1996-2001.

70C.C.01/2010/Prl. Spl. CBI Court/VSP

b)In this connection, prosecution got marked Ex.P.86 through P.W.38.

Ex.P.86 is letter addressed by Director, Triveni Arts College, to Inspector, CBI stating that son of accused studied in this college from 1996 to 2001 and an amount of Rs.5,000/- per year was paid towards fee. None of the persons from the said college were examined to prove the same though burden is upon the prosecution to prove substantial amount of Rs.25,000/-. Mere filing letter and marking through P.W.38/IO do not substitute to proof of payment of Rs.25,000/-. Hence, prosecution miserably failed to prove this sub-item and it is liable to be deleted.

iii)Sub-Item No.3:

a)This sub item is fee of Rs.8,000/- allegedly paid to M/s.Superwhizz, near Andhra Jyoti, Vijayawada, towards fee for the education of son of accsued.

b)In this connection, P.W.25 was examined and Ex.P.57 was marked.

P.W.25 who is Principal of Superwhiz college which is a coaching centre for

Chartered Accountants course since 1992 deposed that in the year 2002 son of accused paid in total Rs.8,000/- out of which Rs.5,000/- is coaching fee,

Rs.1500/- is study material fee and Rs.1500/- is the examination fee and he issued Ex.P.57 letter dated 2.9.2004 in this connection. Ex.P.57 letter issued by him clearly shows the same. It is not the defence that son of accused neither joined in Superwhiz college nor joined in any coaching institute for CA course. Except denying this item nothing more was done by accused to disprove the version of prosecution or to prove actual amount paid towards fee though he got clear knowledge about all aspects touching the evidence of his son. Though in cross examination P.W.25 deposes that no account books were maintained in the absence of any specific defence for the accused that his son did not study in Superwhiz college or not paid any fee in the college, it cannot be said that Principal of the said college deposes 71C.C.01/2010/Prl. Spl. CBI Court/VSP falsely about the fee paid by a student in the absence of any animosity against him. In this backdrop the aforementioned evidence of prosecution is quite sufficient and clear. Hence, the said amount of Rs.8,000/- can be taken into consideration.

iii)ITEM NO.3:

This is expenditure of Rs.1,08,755/- towards fee for education of daughter of accused. In this item, there are three sub items.

i)Sub-Item No.1:

a)Sub Item No.1 is fee of Rs.14,000/- allegedly paid to Nalanda

Education Institute, Vijayawada.

b)To prove the alleged payment, prosecution examined P.W.36 and got marked Ex.P.72. P.W.36 deposed that he was working as Administration

Assistant in Nalanda Educational Institutions, Vijayawada, since 1999 and as per Ex.P.72 letter dated 15.10.2004 issued by Administrative Manager of

Nalanda Educational Institutions and school records Rs.7,000/- per annum shall be paid by day scholars for Intermediate course during the period 1993 to 1995 and original records pertaining to the fee paid by daughter of accused during 1993 to 1995 are quite old and not traceable.

c)According to prosecution since the old records pertaining to the period 1993 to 1995 are not traceable and requisite fee per year for day scholars as per Ex.P.72 is Rs.7,000/- the oral testimony of P.W.6 coupled with Ex.P.72 sufficiently proves the payment of Rs.14,000/- towards fee for 2 years by daughter of accused.

d)In this connection, except denying this expenditure accused did not contend that his daughter did not study in that college in the period 2003 to 2005 or studied in some other college during that period or fee payable by 72C.C.01/2010/Prl. Spl. CBI Court/VSP day scholars per year is not Rs.14,000/- but it is a particular amount less than Rs.14,000/- though he got clear knowledge about the same. In the absence of any evidence or any version forthcoming from accused though this is amount pertaining to fee paid to his own daughter, there is no reason to doubt or discard the evidence of prosecution i.e., oral testimony of P.W.36 coupled with Ex.P.72. Hence, expenditure of Rs.14,000/- under this sub item shall be taken into consideration.

ii)Sub-Item No.2:

a)This is an amount of Rs.11,530/- allegedly paid towards Education fee in Sri Durga Malleswara Siddartha Mahila Kalasala, Vijayawada.

b)In this connection, prosecution examined P.W.11 and got marked

Ex.P.35. P.W.11 who is s a retired Principal of Siddartha Mahila Kalasala,

Vijayawada in the year 2006 deposed that he furnished details of A. Sunitha (daughter of accused) who studied B.Sc., with PME group in that college from 1996 to 1999 and that she paid total amount of Rs.11,530/- for the three academic years under Ex.P.35.

c)Even in this connection accused did not come forward with any defence version in respect of the years of study in that college and fee paid by him. Except denying the version of prosecution he did not do anything more in this connection though he got clear knowledge about the said aspects touching the education of his own daughter. There cannot be any reason to disbelieve the testimony of P.W.11 and genuineness of Ex.P.35 since there is no contra evidence in this connection. Hence, the said amount of Rs.11,530/- shall be taken into consideration.

iii)Sub-Item No.3:

a)It is Rs.82,925/- of fee allegedly paid in Dwarampudi Lakshmana

Reddy College, Gollalamamidada, East Godavari District.

73C.C.01/2010/Prl. Spl. CBI Court/VSP

b)To prove the alleged payment prosecution examined P.W.30 and got marked Ex.P.62. P.W.30 deposed that he worked as Principal in DLR college, from 2001 to 2007 and A. Sunitha, D/o A. Venkateswara Rao studied three years of MCA Course during 1999 to 2002 and paid Rs.60,000/- towards tuition fee for three years and Rs.30,500/- towards hostel fee for three years besides the payment of Rs.1,125/- towards examination fee and on request of CBI, he issued Ex.P.62 containing the payment details. Ex.P.62 is a letter addressed by P.W.30 along with enclosure mentioning the details of payment made by daughter of accused in his college. In this he clearly mentioned the details of payment of tuition fee, examination fee and mess bills. Even in this connection, there is no endeavour made by accused to furnish the correct details and how the details mentioned in Ex.P.62 are incorrect though he got clear knowledge of the education and fee paid to his own daughter.

He did not come forward with any version as to where his daughter studied and what was fee paid by him. Except denying the evidence of prosecution accused did not do anything more than that though he is the best person to explain the same.

c)In this backdrop there is absolutely no reason to discard the testimony of P.W.30 or Ex.P.62 payment details in the absence of any evidence to the contra. Hence, the amount of Rs.82,925/- shall be taken into consideration.

iv)ITEM NO.4:

a)This is expenditure of an amount of Rs.45,592/- towards stamp duty and registration fee for acquiring the properties during the check period.

b)According to accused the amount is only Rs.40,947/-.

c)To prove this expenditure, prosecution examined P.Ws.1,2 and 38 and got marked Exs.P.2 to P.6 and P.81. P.W.1/Sub Registrar deposed that

Rs.10,900/- and Rs.2,096/- were spent for registration of Ex.P.2 gift deed and 74C.C.01/2010/Prl. Spl. CBI Court/VSP

Rs.11,605/- was spent for registration of Ex.P.3 sale deed. P.W.2/District

Registrar deposed that Rs.3,525/- and Rs.60/- was paid each for registration of Ex.P.4 to P.6.

d)In charge sheet itself under Item No.4 seven sub-items are mentioned with details of acquisition of items of property and stamp duty paid. First sub- item is Rs.11,710/- incurred towards stamp duty and registration for acquiring Ac.1.00 of land at Batlapenmarru village under Ex.P.3.

e)Sub Item No.2 is Rs.13,096/- towards stamp duty and registration for acquiring Ac.4.02 cents of land at Batlapenmarru village for gifting the said land by wife of accused to his daughter.

f)Sub-Item No.3 is an amount of Rs.5,386/- incurred by accused for gifting Ac.1.55 cents of land at Batlapenmarru to his daughter.

g)Sub-Item No.4 is Rs.3,585/- incurred towards stamp duty and registration for acquiring Plot No.15, Gunadala from NIAC employees Co- operative House Building Society under Ex.P.4. P.W.2 clearly deposed about the same.

h)Sub-Item No.5 is an amount of Rs.3,585/- incurred towards stamp duty and registration for acquiring Plot No.18, Gunadala from NIAC employees Co- operative House Building Society under Ex.P.6. P.W.2 clearly deposed about the same.

i)Sub-Item No.6 is an amount of Rs.3,585/- incurred towards stamp duty and registration for acquiring Plot No.19, Gunadala from NIAC employees Co- operative House Building Society under Ex.P.5. P.W.2 clearly deposed about the same.

j)Sub-Item No.7 is an amount of Rs.4,645/- incurred towards stamp duty and registration for acquiring Plot No.22, Gunadala from NIAC employees Co- 75C.C.01/2010/Prl. Spl. CBI Court/VSP operative House Building Society under Ex.P.81. P.W.2 clearly deposed about the same.

k)When according to Ex.P.81 son of accused purchased the plot from society and document itself mentions what amount was paid towards stamp duty and registration charges to Registration Department, it cannot be said that sub-item No.7 expenditure is not proved because P.W.2 did not specifically depose that stamp duty and registration expenses were paid by vendee under Ex.P.72. Under sale deeds it is the duty and obligation of purchaser to pay stamp duty and registration charges. There is absolutely no necessity for the society/vendor to pay the said charges. Hence, the entire amount of Rs.45,592/- shall be taken into consideration as expenditure.

v)ITEM NO.5:

a)This is an amount of Rs.39,100/- spent for development of four plots purchased by accused from NIAC Ltd., Employees Co-operative House

Building Society Limited. In charge sheet itself seven receipts bearing

Nos.62,63,66,67,71,72 and 74 where under payment of development chages of Rs.39,100/- in total is mentioned. These receipts are Exs.P.99 to P.103 marked through P.W.38.

b)A careful scrutiny of these receipts show that Exs.P.99 and P.100 are

dated 2.6.2004. Since the check period ends with 31.5.2004 the amount

covered under two receipts do not fall within the check period. By deleting the amount of Rs.9,000/- each covered under Exs.P.99 and 100, the total amount will be reduced to Rs.21,100/- (Rs.39,100 – 18000). Hence, this amount of Rs.21,100/- shall be taken into consideration instead of

Rs.39,100/-.

vi)ITEM Nos.6 & 7:

76C.C.01/2010/Prl. Spl. CBI Court/VSP

a)Item No.6 is an amount of Rs.1,41,586/- allegedly paid towards repayment of 7 crop loans by accused. Item No.7 is an amount of

Rs.52,524/- paid towards interest on 2 crop loans availed and repaid during the check period by son of accused.

b)In both Items 6 and 7, in charge sheet itself it is clearly mentioned that 50% of interest is subsidized by Andhra Pradesh Government. In this connection, prosecution examined P.W.33 and got marked Ex.P.69. These two items are not in dispute and Rs.1,41,586/- and Rs.52,524/- shall be taken into consideration.

vii)ITEM No.8:

a)This is an amount of Rs.51,012/- allegedly paid by accused through cheques towards housing loan availed from General Insurance Company

Housing Finance Limited, Visakhapatnam, during the check period.

b)In this connection, prosecution neither examined any witness nor filed any document. Hence, this amount of Rs.51,012/- shall be deleted from Item

No.8.

viii)ITEM No.9:

a)This item is an amount of Rs.1,41,254/- allegedly paid by accused towards repayment of loan along with interest availed from UCO

Bank,Venkateswarapuram branch, during the check period.

b)Accused denied the amount and contends that amount paid was only

Rs.41,254/- as per P.W.16.

c)To substantiate the version of prosecution, P.W.16 was examined and

Ex.P.40 was marked. As contended by accused, P.W.16 categorically admits in chief examination itself that account holder paid total amount of

Rs.41,254/- only during the period from 12.3.2003 to 10.5.2004.

77C.C.01/2010/Prl. Spl. CBI Court/VSP

d)In view of the aforementioned admission of P.W.16 coupled with Ex.P.40 statement, it is clear that the amount repaid during the check period is only

Rs.41,254/-. Hence, amount under this item shall be treated as Rs.41,254/- instead of Rs.1,41,254/-.

ix)ITEM No.10:

This item of Rs.33,600/- paid to IOB is not in dispute.

x)ITEM No.11:

a)It is an amount of Rs.64,308/- allegedly paid by accused during the check period for clearing the gold loans availed from SBI, Kanakipadu

Branch, Vijayawada.

b)According to accused the amount paid is only Rs.48,300/- under the check period.

c)Prosecution examined P.W.32 and got marked Exs.P.65 to P.68 in this connection. P.W.32/Branch Manager, SBI, Kankipadu branch, deposed that as per Ex.P.65 statement accused paid interest of Rs.5,100/- under gold loan which was closed on 13.12.2004. Accused contends that since the said amount was paid and loan account was closed on 13.12.2004 which is beyond the check period even according to P.W.32. The said amount cannot be considered.

d)As contended by accused, Rs.5,100/- repaid in respect of the said gold loan amount cannot be considered out of the total amount of Rs.64,308/-.

With regard to the amounts paid under remaining three loan accounts,

Exs.P.66 to P.68 Statement of gold loan accounts are duly certified under sec.2A of Bankers' Book of Evidence Act, 1891 and it is also deposed by

P.W.32/Branch Manager. Hence, after deducting amount of Rs.5,100/- from

Rs.64,308/-, the remaining amount of Rs.59,208/- shall be considered.

78C.C.01/2010/Prl. Spl. CBI Court/VSP xi)ITEM NO.12:

a)It is an amount of Rs.1,65,000/- allegedly paid by accused towards purchase of gold (330 grams) at the time of marriage of his daughter, as declared by accused in 1 to 6 Statements.

b)Though it is substantial amount and accused denied this item, prosecution neither examined any witness nor filed any document evidencing the alleged payment. The alleged declaration of accused is not

before the Court and prosecution has to independently prove its case.

Except mentioning this item in the charge sheet and repeating the same in chief examination of P.W.38/IO nothing more is done by prosecution though duty is rest on prosecution to prove its case. Hence, this item of expenditure is liable to be deleted.

xii)ITEM No.13:

a)This is an amount of Rs.73,274/- allegedly spent by accused on the occasion of marriage of his daughter. Out of this amount according to chage sheet Rs.22,050/- was spent towards rent and other charges for

Kalyanamandapam, Rs.18,474/- was spent towards hire of utencils etc., at the time of marriage of his daughter and Rs.32,750/- was allegedly paid to catering contractor.

b)In this connection, prosecution examined P.W.13 and got marked

Exs.P.37 and P.38.

c)Learned counsel for accused submitted that Exs.P.37 and P.38 receipts are photocopies and cannot be relied upon and Ex.P.38 doesn't disclose the payment of Rs.18,474/- by the accused towards rent of Kalyanamandapam and even P.W.13 also admits the same and with regard to the expenditure of

Rs.32,750/- allegedly paid to the Contractor, concerned person was not 79C.C.01/2010/Prl. Spl. CBI Court/VSP examined to prove the same and as such there is absolutely no evidence for the expenditure of Rs.73,274/-.

i)Sub-Item No.1:

a)P.W.13 deposes that he has been working as Accounts Officer in

Dhanekula Venkata Subbaiah Charitable Trust, Vijayawada for the last 20 years and under Ex.P.37 photocopy of receipt dated 8.7.2002, accused paid

Rs.22,050/- towards rent of Dhanekula Kalyanamandapam including service tax, generator charges and Chairman Mr. Ravindranth Tagore passed the said receipt and Kalyanamandapam was booked for performing marriage of daughter of accused. He further deposed that Kalyanamandapam also supplies utensils, gas and electricity and under Ex.P.38 carbon copy of receipt accused paid Rs.18,474/- towards usage of utensils, gas and electricity and the said amount was received after completion of function.

b)As contended by accused, Ex.P.37 is photocopy of receipt attested by

Inspector of Police. In P.W.13 deposition itself it was recorded that at the time of marking Ex.P.37 with objection, Ld. Public Prosecutor represented that IO collected the said document during the course of investigation and by comparing the copy he attested. According to the contents in the receipt, rent for kalayanamandapam including generator and 5% of tax was received.

c)There is no denial regarding the fact of performing marriage of daughter of accused in Dhanekula Kalyanamandapam, Vijayawada on 30.8.2002. If rent for Kalyanamandapam is not Rs.22,050/- accused did not come forward to put forth any version as to what was the correct amount paid by accused. Except flatly denying the payments shown in item no.13 and denying the receipt on technical grounds, no efforts were made by the accused to put forth his own version regarding the amount spent towards rent, catering and other charges of Kalyanamandapam though he got clear and detailed knowledge of all these aspects and even date of marriage is not 80C.C.01/2010/Prl. Spl. CBI Court/VSP long back. It is not his contention that for any specific reason the said

Kalyanamandapam was given to him free of cost. Hence, in the absence of any such evidence flat denial of paying rent of Rs.22,050/- is wholly insufficient. Hence, amount of Rs.22,050/- shall be taken into consideration.

d)Coming to the next sub-item of expenditure ofRs.18,474/- incurred for rent towards cooking ware and allied items in that marriage, P.W.13 filed

Ex.P.38 which clearly mentions what type of cooking vessels were given on rent on the date of marriage which includes supply of gas cylinders and current charges. A simple glance at Ex.P.38 shows that it is a printed format containing a tabular form with columns description of cooking vessels, No. of vessels given for rent, Rent charges for the said vessels and total amount. At the end of tabular form how much gas was used and amount to be paid per one Kg., of gas and how many units of electricity were utilized are clearly mentioned. Further, at the end of table it also contains the signatures of the person handing over and taking over these vessels.

e)There cannot be any marriage without taking rent of vessels for cooking the food and not utilizing the gas and electricity supply. There is no reason to doubt the details mentioned in Ex.P.38 including the payment of

Rs.18,474/-. In the absence of any evidence to the contra, the said amount can be safely taken into consideration. As mentioned supra accused did not adduce any evidence in this connection denying the particulars in Ex.P.38 though he is the best person who got knowledge and competency to speak these aspects. Hence, the amount of Rs.18,474/- can be safely taken into consideration.

f)The third sub item of expenditure is Rs.32,750/- allegedly paid to the catering contractor Sri Angalani Ramakrishna towards catering charges.

Though prosecution clearly mentioned the name of catering contractor as

Angalani Ramakrishna and he has been doing the said catering works under 81C.C.01/2010/Prl. Spl. CBI Court/VSP the name of Sri Lakshmi Catering and Supply company and accused denied the same he was not examined. Be that as it may the alleged payment of

Rs.32,750/- is not evidenced by any receipt. Mere mention of this expenditure in the charge sheet and repeating the same by IO do not constitute proof. Prosecution did not make any endeavour even to explain why Sri A. Ramakrishna was not examined and reasons for non filing of receipt in this connection. Prosecution has miserably failed to prove this amount of Rs.32,750/-. Hence, the possible outcome of the aforementioned discussion is amount shall be taken as Rs.40,524/-(73274-32750) instead of

Rs.73,274/-.

xiii)ITEM No.14:

a)This item is an amount of Rs.8,00,000/- towards gifts given by accused and his family members to the parents of the son-in-law in April/May, 2004.

Five sub items are mentioned under this item separately mentioning the amounts paid by accused, his wife and son through cheques of UCO Bank.

b)In this connection prosecution examined P.W.17 and P.W.38 and got marked Exs.P.41 to P.44, P.96 and 97 through P.W.38/IO.

c)The defence version is parents of son-in-law were not examined to prove the alleged gifts totalling Rs.8 lakhs though father of son-in-law is cited as L.W.15 and even the five cheques were not proved by examining the concerned officials of the Bank and even P.W.38/IO through whom four cheques were marked as Ex.P.98 did not depose about the gifts covered under Ex.P.98 and though P.W.17 was examined from Andhra Bank and

Exs.P.41 to P.44 were marked, Ex.P.41 is a computer generated statement without any certification under sec.65B of Indian Evidence Act and original cheque of HDFC Bank for Rs.1,50,000/- is not at all produced and as such, the said expenditure of Rs.8 lakhs towards these cheques wihout any evidence shall not be considered.

82C.C.01/2010/Prl. Spl. CBI Court/VSP

d)Through P.W.38/IO Ex.P.98 letter from UCO Bank, Venkateswarapuram

Branch, Vijayawada, enclosing two cheques issued by accused and his wife and two cheques issued by accused and his son in favour of Sri K.V.

Satyanarayana were marked and Exs.P.96 and 97 pay-in-slips dated 15.4.2004 in favour of K.V. Satyanarayana for Rs.1,25,000/- and

Rs.1,50,000/- were marked.

e)In this connection, P.W.38 did not explain anything except marking the said cheques through him.

f)P.W.17 who worked as incharge of extension counter Andhra Bank,

Vijayawada, during the relevant period. Through him Ex.P.41 is Statement of

Account in the name of Sri K.V. Satyanarayana i.e., Viyyanka of accused for the period from 1.4.2004 to 30.6.2004, Ex.P.42 pay-in-slip dated 15.4.2004 for crediting the amount of Rs.2,25,000/- through cheque of UCO Bank,

Venkateswarapuram branch, into the account of K.V.Satyanarayana by K.

Satyavathi and Phani Kishore, Ex.P.43 which is a pay-in-slip dated 6.5.2004 for depositing the amount of Rs.1,50,000/- through UCO Bank cheque for crediting into the account of K.V. Satyanarayana and Ex.P.44 pay-in-slip

dated 6.5.2004 for depositing an amount of Rs.1,50,000/- through HDFC

Bank cheque into the account of K.V. Satyanarayana were marked.

g)P.W.17 further deposed that Ex.P.41 was certified under sec.2-A of

Bankers' Book of Evidence Act and the amounts covered under Exs.P.42 to

P.44 pay-in-slips were credited into the acount of K.V.Satyanarayana and

Ex.P.41 reflects the said credit of amounts. Ex.P.41 reflects the said certification made by P.W.17 under sec.2A of Bankers' Book of Evidence Act.

Hence, the defence version that Ex.P.41 is not certified under sec.65B of

Indian Evidence Act cannot be considered when Ex.P.41 was duly certified as per Law.

83C.C.01/2010/Prl. Spl. CBI Court/VSP

h)The aforementioned Exs.P.96,97 and P.42 to P.44 pay-in-slips coupled with Ex.P.98 cheques and Ex.P.41 statement of account of K.V.

Satyanarayana amply proves the deposit of Rs.8 lakhs through cheques during the check period as contended. Hence, amount of Rs.8,00,000/- shall be taken into consideration.

xiv)ITEM No.15:

a)This item of expenditure is Rs.18,950/- allegedly paid towards House tax to Municipal Authorities, Vijayawada, for the period from 1994 to 2004.

b)In this connection, prosecution examined P.W.27 and got marked

Ex.P.59.

c)The defence version is P.W.27 categorically admits that no record relating to collection of tax was available in this office by the date of preparation of Ex.P.59 and the entire records relating to this were maintained in the office of Circle-I and Ex.P.59 which was issued without any records cannot be considered and no other evidene is forthcoming except Ex.P.59 letter and as such this item is liable to be deleted.

d)In the light of this, it is necessary to focus upon the testimony of

P.W.27/Deputy Commissioner, Vijayawada Municipal Corporation from July, 2004 to 2006. He deposed that Ex.P.59 letter was issued by him as he looked after the affairs of levy and collection of tax during the relevant time and as per the letter accused paid an amount of Rs.18,950/- from 1994 to 28.9.2004. In cross examination he admits that by the date of Ex.P.59 letter population of Vijayawada Municipality was in lakhs and city was divided into circles and each circle is having Tax Collector and Assistant Tax Collectors besides Assistant Commissioner who levies tax and Bill Collector recovers the tax levied. He further admits that all the records relating to tax will be maintained in the office of tax collector and house of accused comes under 84C.C.01/2010/Prl. Spl. CBI Court/VSP

Circle-I which is not situated in the premises of Municipal Commissioner's office and by the date of Ex.P.59 all records were maintained in the office of

Circle-I.

e)The aforementioned categorical admissions of P.W.27 clearly show that without going through any records which will be in the custody of Circle-I, he issued Ex.P.59 letter. Even otherwise a simple glance at Ex.P.59 letter issued by Commissioner, Municipal Corporation, Vijayawada, to CBI shows that it simply mentions a single sentence that that accused paid Rs.18,950/- towards House Tax from 1994 till the end of check period. This letter did not contain any enclosures with minimum particulars as to date of bills, date of payments and amounts paid during the check period which is a substantial period of ten years. The testimony of P.W.27 that there are no records in the office of Municipal Commissioner and the entire relevant records will be in

Circle-I and non issue of any particulars of payments and dates of bills by office of Circle-I and mere mention of consolidated amount of Rs.18,950/- towards tax paid during the check period is wholly insufficient for consideration. The prosecution ought to have examined atleast concerned persons regarding the quantum of house tax per year and for how many half years during the check period the tax was paid. Without any details and relevant records mere Ex.P.59 letter mentioning the consolidated amount of

Rs.18,950/- cannot be accepted and this item of expenditure is to be deleted from Item No.15.

xv)ITEM Nos.16 TO 18:

a)These items are Rs.29,437.23 ps., Rs.35,517.19 ps., and Rs.5,000/- towards loss suffered in trading of shares in the names of accused, his wife and son respectively during the check period.

b)In this connection, prosecution is relying upon the testimonies of

P.Ws.5 and 38 and Exs.P.13 to P.15. Ex.P.13 is true copy of Income Tax 85C.C.01/2010/Prl. Spl. CBI Court/VSP

Returns of accused for the Assessment year 1999-2000. According to P.W.5 chartered Accountant Ex.P.13 return was prepared by him on the instructions of accused and accused claimed deductions under sec.80 of Income Tax Act on various investments and donations and under sec.24(1)(5) on Capital borrowed. He further deposed that he also prepared Ex.P.14 Return in the name of accused for the Assessment year 2000-2001 and Ex.P.15 individual

IT return of accused for the assessment year 2002-03, HUF return of accused for the Assessment year 2004-05, IT returns of wife of accused for

Assessment year 2004-05, 2005-06, IT returns of son of accused for the

Assessment years 2004-05, 2005-06, Individual IT return of accused of the

Assessment year 2004-05 and HUF IT return of accused of the Assessment year 2005-06. In cross examination he deposed that he prepared individual

IT returns basing on the instructions of accused . He admits that assessees covered under Exs.P.12 to P.15 came to his office, verified the returns prepared by him and signed in the same.

c)P.W.5 never mentioned about loss in sale of shares of accused, his wife and son. Exs.P.13 to P.15 IT returns also do not specifically referred to loss in shares as mentioned Items No.16 to 18.

d)Turning to the tesimony of P.W.3, who worked as Branch Manager of

Integrated Enterprises Limited, Vijayawada in the year 2004, deposes that the main work undertaken by his office is to provide D-Mat accounts to customers for dealing with shares and to provide mutual fund services and the said D-Mat concept started during the year 1997-1998 and before that shares were transacted in physical mode which caused creation of fake certificates and delay in transfers etc., and to avoid these problems

Government formed National Securities Depository Limited (NSDL) to regularize purchase and sale of shares. Through him Exs.P.7 and P.8 letters addressed to Inspector CBI along with enclosures regarding share details and 86C.C.01/2010/Prl. Spl. CBI Court/VSP

Statement of accounts of accused, his wife and son were marked. He never specifically mentioned about any loss incurred by accused, his wife and son in these shares, as mentioned in Items 16 to 18. Even in Ex.P.95 which is only letter issued by NSDL, no loss is mentioned. In Ex.P.85 which is a letter issued by Insight Share Brokers Private Limited to Inspector, CBI, regarding the trades done and brokerage earned also there is no mention about any specific loss incurred by accused, his wife ad. Hence, there is absolutely no basis for arriving at the loss incurred in shares by accused, his wife and son.

Even otherwise, loss suffered, if any, cannot be added to the Statement of

Expenditure. In the absence of positive and cogent evidence, alleged loss cannot be simply inferred. Hence, amount covered under Items 16 to 18 is liable to be deleted.

xvi)ITEM No.19:

a)This is an amount of Rs.9,23,217.3 ps., incurred according to prosecution towards expenditure incurred for food, clothing, footwear etc., from gross salary of Rs.27,69,652/- during the check period which is calculated at the rate of 33.33% of the gross salary received by accused during the check period.

b)Prosecution contend that as per the ratio laid down in State of Punjab

Vs. Sajjan singh reported in AIR 1964 Supreme Court 464 33.33% of gross salary is taken into account as non verifiable expenditure.

c)In this connection, accused contend that the actual amount is only

Rs.5,53,930.4 ps. The Learned counsel for accused urged that even

P.W.38/IO deposed that circulars of CBI regarding fixing of domestic expenditure are based on supreme Court guidelines and he doesn't remember that from gross salary income tax paid by the employee must be deducted and from that amount 33.33% has to be considered as per

Circulars of CBI and admits that amount of Rs.9,23,217.30 p.s., is not the 87C.C.01/2010/Prl. Spl. CBI Court/VSP amount considered after deduction of income tax paid from gross salary and a charge sheet was filed against their SP A. Sudhakar but denied the suggestions that CBI has followed the method of deducting 33.33% after deducting income tax paid from gross salary.

d)The learned counsel for accused further canvassed that as per

D.W.5/Administrative officer, New India Assurance Company Limited,

Visakahaptanm, an amount of Rs.1,65,888/- was deducted towards TDS and as such, if 1/3rd gross salary is taken into consideration, an amount of

Rs.1,65,888/- shall be deducted from Rs.27,69,652/- which comes to

Rs.26,03,764/-.

e)As submitted D.W.5/Administrative Officer, New India Assurance

Company, Visakhapatnam, who produced Ex.X.3 attested copies of bunch of

Form 16 for the period from 1993-94 to 2003-04 of accused deposed that

Rs.1,65,888/- was deducted towards TDS for the check period from the salary of accused. This amount is not denied by prosecution.

f)When accused admittedly received salary after deduction of the said

TDS towards payment of income tax, as contended by accused, 1/3rd of the gross after deducting TDS of Rs.1,65,888/- i.e., Rs.8,67,921.33 shall be taken into consideration as non verifiable expenditure.

xvii)ITEM No.20:

a)This is an amount of Rs.32,000/- incurred by accused for making donations by accused.

b)Prosecution contend that the said donations are reflected in Exs.P.13 to

P.15 income tax returns filed by accused and it is proved through the testimonies of P.Ws.5,34 and Exs.P.13 to P.15 and P.70.

88C.C.01/2010/Prl. Spl. CBI Court/VSP

c)Accused contends that out of Rs.32,000/- which is covered under three donations mentioned in this item no witness was examined to prove donation of Rs.20,000/- allegedly made to Rural Awareness services, Nambur,

Pedakakani Nagar, Guntur, during 2003-04 and as such, by deducting this amount instead of Rs.32,000/-, Rs.12,000/- alone must be taken into consideration.

d)P.W.34/Income Tax Officer, Ward-II, Vijayawada, deposed that Ex.P.70 letter dated 3.2.2005 addressed by Income Tax Officer to CBI enclosing photostat copies of IT returns submitted by accused for the Assessment year 2003-04 (Financial year 2002-03) accused had also shown deductions under sec.80 to the extent of Rs.35,000/-.

e)P.W.5, who is a Chartered Accountant and prepared Exs.P.13 to P.15 and filed the same, deposed that along with Ex.P.13 IT return accused enclosed the donation receipts made by accused to Siddartha Foundation and

Siddartha Academy of General and Technical Education to the extent of

Rs.12,000/- and declared the same in his Returns and claimed deduction.

f)As deposed by P.W.5 the donation receipts in respect of 2nd and 3rd sub- items in Item 20 are enclosed to Ex.P.13 and they are proved but in respect of the first sub item of donation of Rs.20,000/- to Rural Awareness Centre during 2003-04, there are no enclosures to Exs.P.14 and P.15 in respect of the alleged donation. Hence, the aforementioned amount of Rs.20,000/- shall be deleted from Item No.20. Therefore, after deducting Rs.20,000/- from

Rs.32,000/- of total amount, the amount shall be treated as Rs.12,000/- only, as contended by accused.

xviii) ITEM No.21:

a)This is an amount of Rs.7,96,528/- allegedly paid by accused towards subscription of various Margadarsi Chits during check period.

89C.C.01/2010/Prl. Spl. CBI Court/VSP

b)Prosecution relied upon the testimony of P.W.26 and Ex.P.58. P.W.26 worked as Manager in Margadarsi Chit Fund Limited, Vijayawada branch, from 1981 to 2010. According to P.W.26 Ex.P.58 letter containing the details of chits was given by S.Venkataswamy, Internal Auditor of Margadarsi Chit

Fund Limited enclosing account copies of seven chits pertaining to accused, his wife and son and those statements were taken from computer system maintained in their office by Sri K. Srinivas, Cashier and verified by

Smt.A.Jhansi Lakshmi as Accountant and he signed as Manager. According to the details mentioned in respect of seven chits and as per the statements enclosed to Ex.P.58 an amount of Rs.7,96,528/- was paid by accused and his family members during the check period in respect of seven chits.

c)Under this Item seven sub-items are mentioned separately in the charge sheet with the name of subscriber and amount paid by them during the check period. Out of this accused participated in one chit mentioned in

Sub-item 6. Out of the remaining six sub items, name of daughter of accused is mentioned in respect of the chits in sub-items 1,2 and 4, name of wife of accused is mentioned for the chits in sub items 5 and 7 and name of son of accused is mentioned for the chit in sub item 3.

d)The defence version is not that accused and his family members did not participate in any of the chits mentioned in this Item or in Ex.P.58. The only defence mentioned in oral and written arguments in respect of this item is Ex.P.58 is not certified in accordance with sec.65B of Indian Evidence Act.

It is pertinent to note that in Item No.12 of Addl. Income of accused he claimed that Rs.8,00,140/- was received towards total bid amount under six chits of Margadarsi during the check period by himself and his wife and children. In the absence of any defence version, either denying the chits or explaining the payments and when accused is claiming income upon these chits there is no reason to discard Ex.P.58 details and P.W.26 testimony in 90C.C.01/2010/Prl. Spl. CBI Court/VSP support of version of Prosecution that Rs.7,96,528/- was paid towards these chits. Hence, the said amount shall be taken into consideration.

e)Thus, total amount of Items 1 to 21 of Statement-‘D’ as per the findings mentioned supra is as under.

STATEMENT-D

EXPENDITURE DURING CHECK PERIOD

ItemName of the AssetAs per IOAs perValue No. asRs.accusedconsidered perRs.by Court chargRs. e sheet

1.Net expenditure on 64,087064,087 telephone bills

2.Expenditure on 41,500016,500 Education of the son

3.Expenditure on 1,08,75501,08,755 education of daughter

4. Expenditure towards 45,50240,90745,592 stamp duty and registration fees for the properties acquired

5.Expenditure towards 39,100021,100 development of 04 plots

6.Total amt. of 1,41,5861,41,5861,41,586 repayment of crop loans availed

7.Total interest paid by 52,52452,52452,524 the son of accused on crop loans

8.Amt. paid towards 51,0120Deleted housing loan availed from General Insurance Co. Housing Fin. Ltd.

9.Amt. paid towards 1,41,25441,25441,254 housing loan availed from UCO Bank

10.Consumer loan totally33,60033,60033,600 paid off availed from IOB

11.Gold Loan cleared off 64,30848,30059,208 availed from SBI

12.Gold purchased at 1,65,0000Deleted the time of marriage 91C.C.01/2010/Prl. Spl. CBI Court/VSP

13.Expenditure incurred 73,274040,524 by the accused on the occasion of marriage of his daughter

14.Gifts given by 8,00,00008,00,000 accused and his family members to the parents of son-in- law

15.Tax paid at 18,9500Deleted Municipality of Vijayawada

16.Loss suffered in 29,437.230Deleted trading of shares in the name of accused

17.Loss suffered in 35,517.190Deleted trading of shares in the name of Smt.A.Vijayalakshmi

18.Loss suffered in 5,0000Deleted trading of shares in the name of A. Phani Kishore

19.Expenditure towards 9,23,217.35,53,930.48,67,921.33 food, clothing, footwear etc., at the rate of 33.33% of the gross salary received by accused

20.Expenditure incurred 32,00012,00012,000 while making donations reflected in IT returns

21.Net amount paid by 7,96,52807,96,528 accused towards subscription of chits in Margadarsi Chits Total36,62,241.729,24,141.4031,01,179.33

Hence, total amount of Statement-D is Rs.31,01,179.33

23.From the aforementioned discussion, oral and documentary evidence and findings arrived at on points 2 and 3, the following consolidated

Statements of A,B,C and D emerged:

ABSTRACT OF CONSOLIDATED STATEMENTS OF A,B,C & D

Statement-B Assets at the end of check period20,03,592.83

Statement-A Assets at the beginning of check period5,05,373.00 92C.C.01/2010/Prl. Spl. CBI Court/VSP

Total Income (Statement-C + Addl. Income)75,22,727.00

Total Expenditure incurred during the check period31,01,179.33 (Statement-D)

Assets acquired during the check period 14,98,219.83

(Statement-B – Statement-A

Total Assets acquired during the check period + 45,99,399.16

Statement-D (14,98,219.83 + 31,01,179.33)

Surplus Income (Total Income – Assets + Expenditure29,23,327.84 Amount (75,22,727 - 45,99,399.16))

24.Prosecution did not adduce consistent, coherent, logical, convincing and unimpeachable evidence to establish beyond doubt that accused had been found in possession of assets disproportionate to his lawful sources of income.

25.This factual scenario leads to inescapable conclusion that prosecution miserably failed to establish that accused acquired assets worth

Rs.42,05,386.50 ps., disproportionate to his lawful source of income. On the other hand, accused proved that he got Surplus amount of

Rs.29,23,327.84., and showed all the probabilities in his favour by giving satisfactory explanation.

24.In view of the foregoing reasons, I answer Point Nos.2 and 3 in favour of accused holding that the prosecution failed to prove the guilt of accused for the offence under sec.13(1)(e) r/w 13(2) of P.C. Act, 1988.

25. In the result, accused is found not guilty for the offence punishable under sec. 13(1)(e) r/w 13(2) of Prevention of Corruption Act, 1988 and he is acquitted under Section 248(1) of Cr.P.C. Bail bonds of accused and sureties, if any, shall stand cancelled.

Accused is directed to execute self bond for Rs.20,000/- (Rupees twenty thousand only) as contemplated under Section 437-A of Criminal

Procedure Code, for a period of six months, to appear before the appellate 93C.C.01/2010/Prl. Spl. CBI Court/VSP court, if it is required.

Typed to my dictation, corrected and pronounced by me in open Court on this the day 31st day of January, 2018.

Sd/- A. Gayathri Devi,

PRL. SPL. JUDGE FOR C.B.I. CASES,

VISAKHAPATNAM.

APPENDIX OF EVIDENCE

LIST OF WITNESSES EXAMINED ON BEHALF OF PROSECUTION.

P.W.1/07.04.15: Pattem Veera Raghava Rao P.W.2/07.04.15: Vaka Ranga Reddy P.W.3/09.04.15: Jangala Sri Nagendra Kumar P.W.4/09.04.15: Manchi Kameswari P.W.5/10.04.15: Penugonda Subbaryudu P.W.6/13.04.15: Yellamanchili Krishna Prasad P.W.7/13.04.15: K. Narasimha Rao P.W.8/15.04.15: Rajapeta Srinivasa Reddy P.W.9/16.04.15: Yellamanchili Venugopala Rao P.W.10/17.04.15: A. Lakshmi Kumari P.W.11/17.04.15: Ramineni Ramadevi P.W.12/21.12.15: B. Srinivasa Murthy P.W.13/22.12.15: Smt. D. Rajya Laxmi P.W.14/23.12.15: Kota Madhava Rao P.W.15/28.12.15: Nunna Sateesh P.W.16/28.12.15: B. Narasinga Rao P.W.17/29.12.15: Movva Kanaka Durga P.W.18/29.12.15: M. Sudhakara Rao P.W.19/29.12.15: D. Vijaya Sekhar Rao P.W.20/30.12.15: S.S. Sastry P.W.21/31.12.15: A.S. Chandra Sekhar Reddy P.W.22/31.12.15: S.V. Narahari P.W.23/04.01.16: A.V. Muralidharan P.W.24/04.01.16: B.V.K. Prasad P.W.25/04.01.16: S. Venkateswara Rao P.W.26/04.01.16: T. Babu Rao P.W.27/09.06.16: Y. Sai Srikanth P.W.28/10.06.16: Rajkumar P. Gokanda P.W.29/23.06.16: N. Eswar Prasad P.W.30/23.06.16: P. Srinivasa Reddy P.W.31/24.06.16: U.V. Bhaskara Rao P.W.32/20.09.16: B. Sankara Reddy P.W.33/20.09.16: V.V.S.L.N.Deekshutulu P.W.34/21.09.16: N. Nagabushanam P.W.35/21.09.16: D. Srinivasa Rao P.W.36/21.09.16: Md. Rahaman Zavur P.W.37/21.09.16: B. Prasanna Rao P.W.38/31.10.16: K. Praveen Kumar

LIST OF DOCUMENTS MARKED ON BEHALF OF PROSECUTION.

Ex.P.1: Original gift deed No.3333/01 dt.28.12.01 for Rs.3,63,000/- along with link document Regd.No.1636/84 dt.11.6.84 which were registered at SRO, Movva Ex.P.2: Original gift deed No.3364/01 dt.31.12.01 for Rs.1,39,500/- along with enclosures (30 sheets) 94C.C.01/2010/Prl. Spl. CBI Court/VSP

Ex.P.3: Original sale deed No.463/02 dt.28.03.02 along with enclosures (33 sheets) Ex.P.4: Original sale deed No.2360/02 dt.19.09.02 in favour of A.V. Rao along with enclosures (32 sheets) Ex.P.5: Original sale deed No.2358/02 dt.19.09.02 registered with SRO, Gunadala, along with enclosures (34 sheets) Ex.P.6: Original sale deed No.2464/02 dt.19.09.02 along with enclosures (46 sheets) Ex.P.7: Original letter dt.14.5.05 of Integrated Enterprises (India) Ltd., addressed to the Inspector, CBI, VSP., along with enclosures (share details and statement of accounts of Venkateswara Rao, Vijayalaxmi, Sunitha, Phani Kishore) (sheet Nos.1 to 76) Ex.P.8: original letter dated 9.10.2004 of the Integrated Enterprises (India) Ltd., addressed to K.Praveen kumar, Inspector, CBI, Visakhapatnam along with the shares allotted to Venkateswara Rao (16 sheets) Ex.P.9: Original personal file of A.V. Rao (accused) (344 folios) Ex.P.10: Original personal file of A.V. Rao (accused) (169 folios) Ex.P.11: Original letter dt.24.8.04 of GIC Housing Finance Ltd., VSP., to CBI, VSP., enclosing details of EMI payments and statement of account (4 sheets) Ex.P.12: Letter dt.27.10.04 of Regional Manager, New India Assurance Company Ltd. Addressed to Inspector, CBI, Visakhapatnam along with salary particulars of A.Venkateswara Rao from 1.1.1994 to 31.12.2003 and I to VI statements submitted by A.Venkateswara Rao (18 sheets) Ex.P.13: Original Income Tax returns of A.V. Rao for the Assessment year 1999-2000 along with intimation and enclosures (21 sheets) Ex.P.14: Original Income Tax returns of A.V. Rao for the Assessment year 2000-2001 forwarded by the ITO, Ward-3, Vijayawada, along with enclosures (8 sheets) filed on 12.7.2000 Ex.P.15: Original Income Tax returns of A.V. Rao for the Assessment year 2002-2003 together with photocopies of Income Tax returns for the Assessment year 2004-05 of A.V. Rao and A.V. Laxmi and 2005-06 of A.V. Lakshmi and A.P. Kishore. Ex.P.16: Original Promissory Note dt.29.8.01 for Rs.20,000/- executed by P.W.6 along with enclosures Ex.P.17: Original Promissory note dt.28.8.01 for Rs.20,000/- executed by P.W.6 along with enclosures. Ex.P.18: Original promissory note dt.20.11.2001 for Rs.15,000/- executed by P.W.6 along with enclosures Ex.P.19: Original promissory note dt.22.12.01 for Rs.25,000/- executed by P.W.6. Ex.P.20: Original promissory Note dt.10.10.02 for Rs.50,000/- along with enclosures Ex.P.21: Specimen signatures belonging to P.W.6 obtained by CBI, VSP (5 sheets) Ex.P.22: Original Promissory note dt.1.4.96 for Rs.15,000/- along with enclosures executed by P.W.7 Ex.P.23: Original Promissory note dt.7.1.97 for Rs.15,000/- executed by P.W.7 Ex.P.24: Original Promissory note dt.16.12.96 for Rs.10,000/- executed by P.W.7 Ex.P.25:Specimen signatures of P.W.7 obtained by CBI, VSP (6 sheets) Ex.P.26:Specimen signatures of P.W.8 obtained by CBI, VSP (5 sheets) Ex.P.27: Original promissory note dt.27.5.94 for Rs.15,000/- executed by P.W.9 in favour of accused Ex.P.28: Original Promissory note dt.16.11.97 for Rs.52,000/- along with enclosures. Ex.P.29: Original promissory note dt.4.1.99 for Rs.20,000/- along with enclosures Ex.P.30: Original promissory note dt.16.11.97 for Rs.50,000/- along with enclosures Ex.P.31: Specimen signatures of P.W.9 obtained by CBI, VSP (5 sheets) 95C.C.01/2010/Prl. Spl. CBI Court/VSP

Ex.P.32: Pattadar pass book of A.V. Rao (accused) along with enclosures Ex.P.33: Pattadar pass book of A.Phani Kishore along with enclosures Ex.P.34:Original letter dt.11.3.05 addressed by P.W.10 to CBI, VSP., together with statement and original adangal extracts in respect of Fasali 1403 to 1412 except 1405. Ex.P.35: Letter dt.8.10.04 issued by P.W.11 to K. Praveen Kumar, Inspector, CBI, VSP, furnishing the fee particulars of daughter of accused. Ex.P.36: Original letter dt.16.9.04 of IOB addressed to the CBI, VSP., enclosing statement of A/c.No.16035 and personal loan A/c.No.01/02 (3 sheets) Ex.P.37: Attested photo copy of Receipt No.9 dt.8.7.02 for Rs.22,050/- in the name of A. Venkateswara Rao (accused) Ex.P.38: Carbon copy of the receipt along with translation (4 sheets) Ex.P.12(A): Pay and Allowance particulars of the accused for the period from January, 1994 to December, 2003 (6 sheets) Ex.P.39: Original letter dt.4.9.04 of HDFC Bank, Vijayawada Branch, addressed to the CBI, VSP., enclosing statements of A/c.No.1091050002192 and A/c.No.1092100004032 from 4.3.04 to 26.8.04 and from 4.3.04 to 22.3.05 (24 sheets) Ex.P.40: Original letter dt.16.9.04 of UCO Bank, Venkateswarapuram Branch, Vijayawada, addressed to the CBI, VSP., enclosing attested statement of A/c.Nos.SB.3384 and 2353 (13 sheets). Ex.P.41: Certified copies of statement of A/c.Nos.2503 and 2478 issued by Andhra Bank, Autonagar including typed extract of Bankers’ book (3 sheets). Ex.P.42: Original Andhra Bank credit voucher dt.15.4.2004 for Rs.2,25,000/- in the name of Smt.K. Satyavathi (1 sheet) Ex.P.43: Original Andhra Bank credit voucher dt.06.5.2004 for Rs.1,50,000/- in the name of Smt.K. Satyavathi (1 sheet) Ex.P.44: Original Andhra Bank credit voucher dt.06.5.2004 for Rs.1,50,000/- in the name of Smt.K. Satyavathi (1 sheet) Ex.P.45: Original customer copy of Gas connection document of HPCL dt.13.5.2000 in the name of A. Venkateswara Rao (1 sheet) Ex.P.46: Original letter dt.31.3.05 of MRO, Movva, addressed to the CBI, VSP (1 sheet) Ex.P.47: Original search list dt.7.8.04 Ex.P.48: Proceedings dt.7.8.04 held at Andhra Bank at 2.00 p.m., (2 sheets) Ex.P.49: Proceedings dt.7.8.04 held at Andhra Bank at 4.00 p.m., (2 sheets) Ex.P.50: Inventory proceedings dt.7.8.04 at the house of accused (6 sheets) Ex.P.51: Copies seized from the house of the accused during searches which contain copies of sale deeds and original affidavits (41 sheets) Ex.P.52: Original Search list dt.7.8.2004 (1 sheet) Ex.P.53: Hand written papers without any signatures (7 sheets) Ex.P.54: Original search list dt.7.8.04 (1 sheet) Ex.P.55: Book of General Insurance Conduct, Discipline and Appeal Rules, 1975, as amended upto 22.3.2000 and guidelines on Preventive Vigilance for New India Assurance Company Ltd. Ex.P.55-A: Relevant Page Nos.35 of Ex.P.55. Ex.P.56: Original sanction order dt.26.6.06 issued by the General Manager, New India Assurance company Ltd., Mumbai (7 sheets) Ex.P.57: Original letter dt.2.9.04 of Superwhizz, Vijayawada (1 sheet) Ex.P.58: Original letter dt.2.9.04 of superwhizz, Vijayawada (1 sheet) Ex.P.59: Letter dt.28.9.04 of Commissioner, Municipal Corporation, Vijayawada Ex.P.60: Valuation report dt.June, 2005 Ex.P.61: Letter dt.9.3.05 of Kennedy High School Ex.P.62: Original letter dt.21.9.04 of Dwarampudi Lakshmi Reddy College Ex.P.63: Authorization dt.24.6.04 Ex.P.64: Original FIR in R.C.15(A)/04 including cover of CBI, Visakhapatnam, forwarding letter (9 sheets) Ex.P.65: Statement of gold loan account of accused of SBI, Kankipadu Branch, vide A/c.No. 0157107009801 96C.C.01/2010/Prl. Spl. CBI Court/VSP

Ex.P.66: Statement of gold loan account of accused of SBI, Kankipadu Branch, vide A/c.No. 0157107009800 Ex.P.68: Statement of gold loan account of accused of SBI, Kankipadu Branch, vide A/c.No. 0157107009802 Ex.P.69: Letter dt.21.9.14 of Secretary, K.L.S. Cooperative credit society, Konavennu along with statements of loans of accused (7 sheets) Ex.P.70: Letter dt.3.2.2005 by Income Tax Officer in the office of Income Tax, Vijayawada, to SP, CBI, VSP., along with enclosures Ex.P.71: Letter dated 20.9.2004 sent by the then Secretary, GIE, Co- operative Thrift and Credit society Ltd., Vijayawada to Inspector of Police, CBI, Visakhapatnam Ex.P.72: Letter dated 15.10.2004 given by Administrative Manager of Nalanda Educational Institutions, Vijayawada to Inspector of police, CBI. Ex.P.73: Letter dated 24.3.2005 by AAO, ERO, Rural , Vijayawada to CBI,VSP, along with enclosing statements Ex.P.74: Letter dated 2.9.2004 by AAO, ERO, Rural, Vijayawada to CBI, VSP, along with enclosing statements Ex.P.75: Authorization dt.5.8.04 given by SP,CBI, VSP. Ex.P.76: Search warrant Ex.P.77: Search warrant dt.6.8.04 Ex.P.78: Search warrant under sec.161 Cr.P.C. dt.7.8.04 Ex.P.79: Valuation report dt.7.8.04 given by P. Sarathchandra Ex.P.80: Letter dt.3.9.04 along with enclosures (2 sheets) Ex.P.81: Attested copy of registered document No.1765/04 of SRO, Gunadala dt.5.5.04 Ex.P.82: Annexure-I regarding details of Tax Saving Bond in the name of accused for Rs.10,000/- Ex.P.83: Letter dt.9.9.04 by Annexures (13 sheets) Ex.P.84: Photo copy of letter dt.16.9.04 and enclosures (7 sheets) Ex.P.85: Letter dt.20.9.04 from M/s. Inright Share Brokers Pvt. Ltd., and its enclosures Ex.P.86: Letter dt.22.9.04 from Triveni Art College furnishing details of fee paid Ex.P.87: Letter dt.5.10.04 from Sri Lalitha Devi Gas Agencies Ex.P.88: Letter dt.23.9.04 along with enclosures from N.I.A. Co-operative Thrift and Credit Society Ltd. Ex.P.89: Letter dt.23.9.05 regarding reimbursement received by the ccused from the Department i.e., New India Assurance (3 sheets) Ex.P.90: Tax saving bonds for Rs.5,000/- each issued by ICICI in the name of accused dt.27.5.00. Ex.P.91 : Two IDBI infrastructure (Tax saving) bond for Rs.5,000/- each in the name of accused issued by IDBI dt.30.3.01 and 15.3.02 Ex.P.92

Ex.P.93: Copy of Form No.44 from RTO, Vijayawada, furnishing details of scooter bearing No.AP 16 M 0626 stands in the name of accused from 28.8.02 Ex.P.94: Letter dt.28.3.05 from BSNL, Vijayawada, furnishing the data of bill paid particulars on the land line No.2552992 of accused in the form of computer printout. Ex.P.95:Letter dt.6.5.05 copy marked to CBI, VsP, from NSDL, Mumbai, furnishing the client ID and DP ID of accused and his family members.

Ex.P.96 : SB Account pay-in-slips dt.15.4.04 in favour of K.V. Satyanarayana from Andhra Bank for Rs.1,25,000/- and Rs.1,50,000/- Ex.P.97

Ex.P.98: Letter dt.10.8.05 from UCO Bank, Venkateswarapuram Branch, Vijayawada, by enclosing four paid cheques issued by accused and his family members in favour of K.V. Satyanarayana (two cheques) 97C.C.01/2010/Prl. Spl. CBI Court/VSP and his wife and K. Satyavathi (two cheques) by accused and his son respectively along with four cheques (5 sheets) Ex.P.99: True copy of Receipt No.79 dt.2.6.04 for Rs.9,000/- in favour of son of accused to meet the expenditure of formation of B.T. Road, Plot No.22, issued by Co-operative Society Ltd. Ex.P.100: True copy of Receipt No.78 dt.2.6.04 for Rs.9,000/- in favour of accused to meet the expenditure of formation of B.T. Road, Plot No.15, issued by Co-operative Society Ltd. Ex.P.101: True copy of Receipt No.71 dt.20.5.04 for Rs.1,400/- in favour of accused to meet the expenditure of formation of B.T. Road, Plot No.15, issued by Co-operative Society Ltd. Ex.P.102: Carbon copy of Receipt No.72 dt.20.5.04 for Rs.1,400/- in favour of accused to meet the expenditure of formation of B.T. Road, Plot No.19, issued by Co-operative Society Ltd. Ex.P.103: True copy of Receipt No.74 dt.20.5.04 for Rs.1,300/- in favour of son of accused issued by Co-operative Society Ltd. Ex.P.104: Promissory note dated 6.12.02 for Rs.20,000/- Ex.P.105: Promissory note dated 10.10.02 for Rs.35,000/- Ex.P.106: Promissory note dated 10.10.02 for Rs.17,000/- Ex.P.107: Promissory note dated 3.10.02 for Rs.25,000/- Ex.P.108: Promissory note dated 26.08.02 for Rs.33,000/- Ex.P.109: Promissory note dated 09.05.03 for Rs.95,000/- Ex.P.110: Specimen signatures of K. Lokeswara Rao (5 sheets) Ex.P.111: Specimen signatures of M. Venkateswara Rao (5 sheets) Ex.P.112: GEQD Expert opinion along with reasons along with covering letter dt.6.2.07 (5 sheets)

LIST OF WITNESSES EXAMINED ON BEHALF OF DEFENCE.

D.W.1/16.08.17: Smt.A. Lalitha Kumari D.W.2/16.08.17: T. Israel D.W.3/16.08.17: G. Ramanamurthy D.W.4/22.09.17: G. Nageswara Rao D.W.5/22.09.17: P.S.R.V.S.C. Sastry

LIST OF DOCUMENTS MARKED ON BEHALF OF DEFENCE.

Ex.X.1: Statement showing the details of interest and dividend for the period from 1994 to 2004.

(Ex.X.1 was marked during the cross examination of P.W.35)

Ex.X.2: List of MSP Prices for the period 2003-2004 Ex.X.3: Form-16 of accused for the period from 1993-94 to 2003-2004 (Exs.X.2 and X.3 were marked through D.Ws.4 and 5)

Ex.X.4: Letter dt.26.6.06 of DIG, CBI, Hyderabad to CVO, NIA Co. Ltd. Mumbai Ex.X.5: Model sanction order sent by CBI along with Ex.X.4 Ex.X.6: Letter dt.26.6.06 addressed by CVO, requesting P.W.23 to accord sanction.

(Exs.X.4 to X.6 were marked during the cross examination of P.W.23)

MATERIAL OBJECTS MARKED ON BEHALF OF PROSECUTION

NIL

Sd/- A. Gayathri Devi,

98C.C.01/2010/Prl. Spl. CBI Court/VSP

PRL. SPL. JUDGE FOR C.B.I. CASES,

VISAKHAPATNAM

IN THE COURT OF THE PRINCIPAL SPECIAL JUDGE FOR C.B.I. CASES,

VISAKHAPATNAM.

Present: Smt. A. GAYATHRI DEVI, Prl. Spl. Judge for C.B.I. Cases, Visakhapatnam.

Friday, this the 29th day of December, 2017

C.C.No.7/2011

Between:

State represented by Inspector of Police, C.B.I, SPE, Visakhapatnam.

…Complainant And:

1. Mallampati Pratap Kumar, s/o Mallampati Veerabrahmam, aged 56 years,Ex.Constable,Railway Protection Force, Bapatla (Presently under suspension and attached to O/o.AssistantSecurity Commissioner, RPF, SC Railway, Rajahmundry) r/o Patchala Tadi Parru Post, Ponnuru Mandal, Guntur District. (Accused No.1) …Accused No.1

2. Devarayi Srinivasa Rao, s/o D. Nagabhushanam, aged 50 years, Ex. Inspector, Railway Protection Force, South Central Railway, Chirala, Prakasam District (Presently under suspension and attached to ‘A’ company,RPF,SCRailway, Secunderabad) r/o Kolagutla Post, Durgi Mandal, Guntur District. (Accused No.2) (Accused No.2 discharged by

Hon’ble High Court as per orders in

Crl.R.C.1801/14 dated 12.4.2017)

This case has come up on 20.12.2017 for final hearing before me in the presence of Sri A. Chennakeshavulu, Ld. Public Prosecutor for the State-

Complainant and of Sri N.V.V.Prasad and Sri N. Shankar, Ld. Advocates for 2C.C.7/2011/Prl. CBI Court/VSP

Accused no.1 and the matter having stood over for consideration till this day, this Court doth the following:

J U D G M E N T

The State represented by Inspector of Police, CBI, SPE, Visakhapatnam, filed charge sheet in R.C.15(A)/2009-CBI/VSP against accused no.1 and 2 for the offence under sec.120-B of IPC and secs.7 and 13(2) r/w 13(1)(d) of

Prevention of Corruption Act, 1988.

2.The case of the prosecution, in nutshell as per charge sheet, is as follows:

Accused No.1 who was working as RPF Constable, Outpost, South

Central Railway, Bapatla, in pursuance of criminal conspiracy with Accused

No.2 who was working as Inspector, RPF, Chirala, on 9.8.2009 made call from his mobile No.9849277041 to the mobile number of complainant Addanki

Vijay i.e., 9848714481 and demanded illegal gratification of Rs.5,000/- for allowing him to run his business smoothly and A.1 also threatened the complainant if amount demanded was not paid he would be implicated in a case and his shop would be closed and A.1 asked the complainant to make a call to him when the money was ready so that place of delivery would be informed. Since complainant was not willing to pay bribe he lodged written complaint dated 10.8.2009 to CBI, Visakhapatnam and handed over the same at 11.40 hours on the same day to Superintendent of Police, Ramarao,

Inspector of Police, CBI, Visakhapatnam, who was camping at Bapatla along with his team and the said Inspector in turn sent the complaint by fax to SP

CBI, Visakhapatnam, basing on the complaint received by fax,

R.C.15(A)/20009 was registered on 10.8.2009 by CBI, Visakhapatnam,

against A.1.

3C.C.7/2011/Prl. CBI Court/VSP ii)On the instructions of SP, CBI, Sri S.P. Rama Rao, Inspector, proposed to verify the complaint and lay trap after observing the trap formalities.

During the course of pre trap proceedings dated 10.8.2009, complainant made a call from his mobile to A.1 and reminded him about the demand made on the previous day. Accused no.1 told him that he would come to shop shortly. During the course of trap laid on 10.8.2009, A.1 was caught red handed while demanding and accepting Rs.5,000/- as illegal gratification from complainant at a tea stall located close to the shop of complainant. The demand and acceptance took place in the presence of independent accompanying witness. Soon after demanding and accepting the bribe money, A.1 got suspicious and dropped money on a newspaper lying on the floor of tea stall. The tainted currency notes dropped by A.1 were recovered in the presence of independent witnesses. When A.1 was questioned about the demand and acceptance, he admitted the same and explained that he did so on the instructions of Sri D. Srinivasa Rao, Inspector, RPF, Chirala.

iii)After collecting the washes of fingers of both hands of accused no.1 and cotton swab wash of the news paper from which the tainted currency was recovered, both complainant and A.1 were made to talk to A.2 on his mobile from the mobile of A.1. During this conversation, complainant told A.2 that he had given the amount and A.2 conveyed his thanks. A.1 also spoke to

A.2 and told him that complainant had given Rs.5,000/- and asked him as to what to do with the money. A.2 instructed A.1 to keep the money with him and he would come and collect the same in the evening of 10.8.2009. When

A.1 expressed his inability to do so, A.2 asked A.1 to keep the amount in a cover and handover the same to SI, RPF Outpost, Bapatla and he would collect the same. At that stage, A.1 told A.2 that he did not retain any 4C.C.7/2011/Prl. CBI Court/VSP amount and entire amount would be sent to him. Sri P. Venkateswarulu, the then SI, RPF Outpost, Bapatla refused to accept the cover from A.1.

iv)Basing on the complicity of A.2 made out from a telephonic conversation recorded, over heard by the trap team including the complainant and independent witnesses in the second mediator's report, A.2 was arrested after the trap laid against A.1 and produced him before the

Court on 10.12.2009. Postive report was given by Central Forensic Science

Laboratory, Hyderabad, on 31.3.2010. Conversations recorded during pre trap and post trap proceedings were sent to CFSL, Chandigarh, for voice spectrography and result is awaited. The said acts of A.1 and A.2 shows that they have abused their official position as public servants and obtained

Rs.5,000/- as illegal gratification other than legal remuneration from the complainant which constitute the offence punishable under sec.120-B IPC, secs.7 and 13(2) r/w 13(1)(d) of P.C. Act, 1988..

3.On filing of charge sheet, case was taken cognizance against accused no.1 and 2 under secs.120-B IPC and secs.7 and 13(2) read with 13(1)(d) of

P.C. Act, 1988 and summons were issued to the accused. On appearance of accused No.1 and 2 copies were furnished.

4.Upon hearing the counsel for accused no.1 and 2, charges under sec.120-B of IPC and secs.7 and 13(2) read with 13(1)(d) of P.C., Act, 1988 against accused no.1 and 2 were framed, read over and explained to them for which they pleaded not guilty and claimed to be tried.

5.On behalf of prosecution, P.Ws.1 to 14 were examined and Exs.P.1 to

P.35 and M.Os.1 to 11 were marked.

6.On completion of evidence on prosecution side, accused no.1 was examined under sec.313 Cr.P.C., he denied the incriminating evidence and 5C.C.7/2011/Prl. CBI Court/VSP filed written statement. On behalf of accused no.1, D.W.1 was examined and

Ex.D.1 was marked.

7.Heard the learned counsel for accused no.1 and Learned Public

Prosecutor for Prosecution. Perused the material on record and written arguments of both sides.

8.A.2 sought for discharge and filed Crl.M.P.621/13 and upon dismissing the same, he preferred appeal in Crl.R.C.1801/14 and Hon'ble High Court was pleased to allow the said revision and thereby A.2 was discharged from all the charges vide orders dated 12.4.2017. Prosecution did not file any evidence to show that the said order was challenged. Hence, order dated 12.4.2017 in Crl.R.C.1801/14 became final and binding on this Court.

Thereafter, this Court proceeded only against Accused No.1.

9.Now the points for determination are:

1) Whether sanction against A.1 is valid?

2) Whether prosecution proved demand and acceptance of illegal gratification and recovery of amount from Accused No.1?

3) Whether prosecution established charge against Accused No.1 under sec.7 of P.C. Act, 1988 beyond all reasonable doubt?

4) Whether prosecution established charge against Accused No.1 under sec. 13(2) r/w 13(1)(d) of P.C. Act, 1988 beyond all reasonable doubt?

10.POINT No.1:

The version of Prosecution in this connection is on perusal of entire material and on application of mind P.W.12/sanction authority accorded

Ex.P.31 sanction order and he is competent to accord sanction as per Ex.P.32.

11.Per contra, Ld. Counsel for A.1 has strenuously urged that Ex.P.31 sanction order is not valid in view of the admission of P.W.12 that Railway

Board is competent to appoint and remove any of its employees by following 6C.C.7/2011/Prl. CBI Court/VSP due process of law and as such P.W.12 is not competent to remove A.1 or issue sanction to prosecute him.

12.To buttress this contention, Ld. Counsel for A.1 placed reliance upon the following decisions regarding validity of sanction:

1. State of Karnataka Vs. Ameer Jan reported in (2008) 1 SCC (Cri.) 130;

2. State of Goa Vs. Babu Thomas reported in (2005) 8 SCC 130;

3. Central Bureau of Investigation Vs. Ashok Kumar Agarwal reported in 2015 SCC (Crl.) 344; and

4. Nanjappa V State of Karnataka reported in (2016) 2 (SCC) Crl.360.

13. Whereas learned Public Prosecutor placed reliance upon :

Gurubachan Singh Vs. State reported in AIR 1970 Delhi 102 wherein regarding sanction the Lordships succinctly held that:

“Intention of legislature in providing for a sanction in respect of the offences covered by Section 5A of the Prevention of Corruption Act is merely to afford a reasonable protection to the public servants in the discharge of their official functions. It is not the object of the sanction that a public servant, who is guilty of the particular offence mentioned in that section, should escape the consequences of his criminal act by raising the technical plea of invalidity of sanction. The section is a safe- guard for the innocent and is not shielf for the guilty.”

14.In the light of the respective contentions, a deep insight into the testimony of P.W.12, Exs.P.31 sanction order and Ex.P.32 photocopy of schedule of Administrative Powers of Superior officers and Disciplinary authorities and their powers shows the following admissions of P.W.12 in cross examination:

“It is true that as per Ex.P.32 schedule Additional/Deputy Chief Security

Commissioner/Principal, RPF Academy, is also competent to remove 7C.C.7/2011/Prl. CBI Court/VSP the persons below the cadre of Inspectors. It is true that during the relevant time the cadre of Divisional Security Commissioner is lower than Additional/Deputy Chief Security Commissioner.”

15.In Chief examination P.W.12 deposed that during the relevant time of issuing sanction order he worked as Senior Divisional Security Commissioner,

RPF, South Central Railway, Vijayawada and he wascompetent authority to issue sanction order against RPF constables. According to the schedule of

Administrative powers enclosed to the sanction order, Deputy Chief Security

Commissioner/Principal, RPF Academy and Divisional Security

Commissioner/Security Commissioner/Commanding Officer/Senior Security

Commissioner are competent to remove the persons below the cadre of

Inspectors. The cadre of P.W.12 is mentioned in Column No.6 and cadre of

Addl. Deputy Chief Commissioner and Principal, RPF Academy, are mentioned in Column No.5. But schedule neither specifies any preferential powers to the officers mentioned in column No.5 nor prevent the officers mentioned in Column No.6 to remove the persons below the cadre of

Inspectors. Even in cross examination what was admitted by P.W.12 is

Additional/Deputy Chief Security Commissioner/Principal, RPF Academy were

also competent to remove the persons below the cadre of Inspectors along with him. This admission do not in any way support the defence version that

P.W.12 himself is not competent to remove the persons below the cadre of

Inspectors and consequently Ex.P.31 sanction order issued against A.1 is invalid.

16.Further, P.W.12 clearly deposed that he perused FIR, pre trap and post trap proceedings, transcriptions of the conversations, Statement of witnesses, CFSL report dated 31.3.2010 and other relevant material before according sanction against A.1 and on application of his mind he dictated the sanction order to the steno. In addition to that in page no.6 of Ex.P.31 8C.C.7/2011/Prl. CBI Court/VSP sanction order itself he clearly mentioned that as per the delegation of powers he is competent to remove A.1 from service.

17.The sum and substance of the above reasoning shows acceptable and clinching evidence that P.W.12 is competent and Ex.P.31 sanction order is valid and there is no merit in the defence version that P.W.12 is not competent to remove A.1 from service and prosecution has proved competency of P.W.12 and validity of Ex.P.31 sanction order is not valid.

18.POINT Nos.2 TO 4:

PROSECUTION CASE:

i)Sans the unnecessary details, essence of the case of prosecution is as follows:

A.1 while working as constable RPF outpost, Bapatla, during the year 2009 in pursuance of criminal conspiracy with D. Srinivasarao who worked as

Inspector, RPF, Chirala, at that time made call to the cell number of the complainant on 9.8.09 and demanded illegal gratification of Rs.5,000/- for allowing him to run the business smoothly and he also threatened the complainant that if the said demand is not hounoured he would be falsely implicated in the case and shop would be closed and instructed the complainant to give him a call after making the amount ready for informing the place of delivery and the complainant who was not willing to pay bribe, lodeged written complaint to SP, CBI, on 10.8.2009 and SP Ramarao,

Inspector, CBI, who was camping at Bapatla along with his trap team sent the complaint by fax to SP and the same was registered against A.1 and upon the instructions of SP, Inspector conducted pre trap and post trap proceedings and A.1 was caught red handed during the course of trap laid on 10.8.09 while demanding and accepting illegal gratification of Rs.5,000/- at 9C.C.7/2011/Prl. CBI Court/VSP tea stall located near the shop of complainant and the tainted currency was recovered in the presence of independent witnesses.

ii)It is the further case of prosecution that when A.1 was questioned he admitted the demand and acceptance of bribe amount from the complainant and explained that on the instructions of D.Srinivasarao, RPF Inspector, he did so and on giving such answer when complainant and A.1 were made to talk to the said Srinivasarao by calling on his mobile number, the said

Srinivasarao conveyed thanks to the complainant for giving the amount and instructed A.1 to keep the said amount of Rs.5,000/- so that he would personally collect the same in the evening of the next day 10.8.2009 and when A.1 expressed his inability, D. Srinivasarao asked him to keep the amount in a cover and hand over the same to SI, RPF, Outpost, Bapatla and he would collect the said cover and A.1 told him that he did not retain any amount and entire amount was sent to him and the then SI RPF, Bapatla refused to accept the cover from A.1 and from this conversation recorded in the presence of independent witnesses, post trap proceedings were prepared and even A.2 was arrested and the colour test yielded positive result and as such, A.1 is liable to be convicted under secs.7 and 13(1)(d) r/w 13(2) of P.C.

Act, 1988.

19.DEFENCE OF ACCUSED No.1:

The crux of defence of A.1 is as follows:

i)A.1 is innocent and falsely implicated in the case; ii)A.1 neither demanded nor accepted bribe from P.W.1 and on the date of demand he was on duty on Railway Platform from 6.00 a.m., to 14.10 p.m., and he is not the owner of cell phone No.9849277041; 10C.C.7/2011/Prl. CBI Court/VSP iii)Prior to this case, P.W.1 was summoned by RPF officials in connection with RP (UP) Act on the suspicion that P.W.1 was purchasing Railway materials and upon that P.W.1 suspected that at the instance of A.1 RPF officials summoned him and developed grudge against A.1; iv) As usually on 10.8.2009 at about 3.00 p.m, A.1 went to the tea stall which is close to the shop of P.W.1 to have tea and while he was having tea, when P.W.1 came and requested him to handover the amount to D.

Srinivasarao (earlier A.2) he refused with his right hand and left the shop and after walking upto some distance some persons claimed as CBI officials caught him and took him to Railway station and forced him to handover a cover to SI and on refusal they threatened and abused and at their direction only in their presence when he tried to deliver the cover to SI, it was refused and the said CBI officials took return of the cover and colour test is a manipulated one; and

v)Cell phone was not seized from A.1 on the date of trap and A.1 did not talk to A.2 on the date of trap.

20.ADMITTED FACTS:

i)P.W.1/complainant is Proprietor of Sri Durgamba Traders and his shop is near to Railway station, Bapatla. A.1 was working as constable, RPF outpost,

Bapatla during the relevant period.

ii)In charge sheet itself it is mentioned that in pursuance of conspiracy with D. Srinivasarao, SI, RPF, Chirala, only A.1 demanded and accepted bribe to handover the same to D. Srinivasarao (earlier A.2) but trap could not be laid on him.

11C.C.7/2011/Prl. CBI Court/VSP iii)D. Srinivasa Rao who was shown as Accused No.2 was discharged by the order of Hon'ble High Court dated 12.5.2017 in Criminal Revision

No.1801/2014. Material on record do not show that the said order was either challenged or set aside.

iv)P.W.13/Expert CFSL, Chandigarh, did not give any opinion in respect of

C.Ds.1 and 2 (M.Os.2 to 9) on the ground that they are noisy. Even in Court also M.Os.2 and 9 C.Ds., could not be played as mentioned in deposition of

P.W.4 and they are defective.

21.RELATED LAWS:

It is expedient at this juncture to set out the relevant extracts of section 7 and 13 of the P.C.Act under which the accused was charged:

“7. Public servant taking gratification other than legal remuneration in respect of an official act:

Whoever, being, or expecting to be a public servant, accepts or obtains or agrees to accept or attempts to obtain from any person, for himself or for any other person, any gratification whatever, other than legal remuneration, 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 functions, favour or disfavor to any person or for rendering or attempting to render any service or disservice to any person, with the Central Government or any

State Government or Parliament or the Legislature of any State or with any local authority, corporation or Government company referred to in clause (c) of section 2, or with any public servant, whether named or otherwise, shall be punishable with imprisonment which shall not be less than three years but which may extend to seven years and shall also be liable to fine.” “13. Criminal misconduct by a public servant (1) A public servant is said to commit the offence of criminal misconduct,-

(d) if he,-

(i) by corrupt or illegal means, obtains for himself or for any other person any valuable thing or pecuniary advantage; or

(ii) by abusing his position as a public servant, obtains for himself or for any other person any valuable thing or pecuniary advantage; 12C.C.7/2011/Prl. CBI Court/VSP

22.BURDEN OF PROOF:

In order to prove charge under sec.7 and 13 of P.C. Act, 1988, prosecution has to establish by positive, cogent and succinct evidence the demand and acceptance of illegal gratification. Till that is accomplished accused should be considered as innocent.

23.LEGAL POSITION:

i)Learned counsel for A.1 placed reliance upon following decisions regarding the essential ingredients of demand, acceptance and recovery under sec.7 and 13(1)(d) of P.C. Act :

1. State through CBI Vs. Dr. Anup Kumar Srivastava reported in 2017 (3) ALT Crl. 56 Supreme Court wherein the Apex Court succinctly held as follows:

“Proof of demand is indispensable essentiality and of permeating mandate for an offence under secs.7 and 13 of P.C. Act, 1988. What constitutes illegal gratification is a question of law whether on the evidence that crime has been committed is a question of fact. If, therefore, evidence regarding the demand and acceptance of a bribe leaves room for doubt and doesn't displace wholly, the presumption of innocence, the charge cannot be said to have been established.”

2.In Mukhtiar Singh Vs. State of Punjab reported in 2017 (3)

Supreme Court cases (Crl.) 607 the Lordships erudite as follows:

“Mere acceptance of any amount allegedly by way of illegal gratification or recovery thereof, dehors proof of demand, ipso facto, would not be sufficient to bring home charge under secs.7 and 13 of

P.C. Act, 1988.” 13C.C.7/2011/Prl. CBI Court/VSP

3. Same principles are laid down in T.K. Ramesh Kumar Vs. State through Police Inspector, Bangalore, reported in 2016 (3) Supreme

Court cases (Crl.) 316 and Yellinedi Sagareswararao Vs. State of A.P.

represented by ACB, Vizianagaram reported in 2011 (2) ALT (Crl.) 90.

4.In P. Parasuramireddy Vs. State of A.P. reported in 2012 (1) SCC (Crl.) 552 regarding the importance of Chemical tests (Phenolphthalein test)

Apex Court erudite as follows:

“A single circumstance by itself may not be able to establish that money was demanded and and it was accepted as bribe, it could have been the possiblity that complainant might have touched the currency notes and had shaken the hand with the accused or it could be that any one of the investigating officers or the member of the raiding party had touched the fingers of the accused. That circumstance itself cannot be ruled out. We have seen the judgments of the Court below wherein the sole evidence of the fingers being soiled in Sodium carbonate turned pink has been relied upon. Both the Courts below seem to have impressed by this situation alone. We do not feel it sufficient to convict the accused on this evidence alone and we would choose to give him the benefit of doubt.” ii)Whereas Learned Public Prosecutor placed reliance upon the following decisions:

1.In State of AP Vs. P. Venkateswarulu in Crl.Appeal No.1317/2008

dated 6.5.2015 Lordships erudite that:

“Probability of accused not being present could not be considered and it was for accused to rebut presumption mandated by section 20 of

Act, by adducing direct or circumstantial evidence, that money recovered was not reward or motive as mentioned under section 7 of

Act.”

2. Chaturdas Bhagwandas Patel Vs. State of Gujarat in Criminal

Appeal No.250/71 dated 16.4.76 Lordships succinctly held as follows:

14C.C.7/2011/Prl. CBI Court/VSP “section doesn't require that public servant must be in a position to do the official act, favour or service at the time of demand or receipt of gratification. To constitute offence under secs.4 and 5 of P.C. Act, it is enough if the public servant who accepts the gratification takes it by inducing a belief or by holding out that he would render assistance to the giver with any other public servant and the giver gives the gratification under that belief.

3.State of Himachal Pradesh Vs. Lekh Raj & another reported in 2000 (1) ALD (Cri) 43 Supreme Court the Lordships held as follows:

“The traditional dogmatic hypertechnical approach has to be replaced by rational, realistic and genuine approach for administering justice in a criminal trial. Criminal Jurisprudence cannot be considered to be a

Utopian though but have to be considered as part and parcel of the human civilisation and the realities of life. The courts cannot ignore the erosion in values of life which are a common feature of the present system. Such erosions cannot be given a bonus in favour of those who are guilty of polluting society and the mankind.”

4.Kundan Singh Vs. State reported in Crl.Appeal 711/2014 of Delhi

High Court dated 24.11.2015 wherein regarding certificate under sec.65-

B of Evidence Act the Lordships held as follows:

“The said certificate can be produced when the electronic record is to be admitted and taken on record i.e., when the prosecution, defence or a party to the civil litigation wants the electronic record to be marked as an exhibit and read in evidence.”

5.Though page 15 of written arguments simply mentioned the citation

Barot Manganlal Premji Vs. State reported in AIR 1955 NVC 955

(San), itwas not given along with other citations.

24.On umpteen occasions Apex Court and our own High Court consistently held that mere acceptance of any amount by way of illegal gratification or recovery there of dehors proof of demand, ipso facto is not 15C.C.7/2011/Prl. CBI Court/VSP sufficient to bring home charge under secs.7 and 13 of P.C. Act,1988. Even ratio laid down in the rulings relied upon by the learned counsel for A.1 is to the same effect.

25.Further, whether any official work of P.W.1 is pending before A.1 for demanding illegal gratification is also to be proved by prosecution.

26.Since proof of demand or illegal gratification is the gravemen of the offence under sec.7 and 13(1)(d) of P.C. Act, 1988, we shall now delve into oral and documentary evidence of prosecution to appreciate and weigh the competing contentions in that connection.

27.PRIOR ACQUAINTANCE BETWEEN COMPLAINANT/P.W.1 AND A.1:

i)Earlier demands:

In para No.2 of Ex.P.1 written complaint of P.W.1 dated 10.8.2009 he narrates as follows in respect of earlier demands:

“గత నెలరోజులలుగా Pratap అని పేరలుగల బాపటట్ల RPF constable మా shop వదద్దకు వచచ, RPF station కు మామమూలలుయివవ్వమని అడుగలుచలునన్నాడు. మొదటట్ల నేనలు ఆ విషయానిన్నాపెదద్దగా పటటట్టించలుకోలేదలు.” ii)In first para of Ex.P.1 in introductory portion P.W.1 had explained that he was running business in purchase and sale of old papers, scrap iron and empty bottles under the name and style of Sri Durgamba Traders in Railway

Station Road, Bapatla.

iii)In respect of prior acquaintance with A.1 P.W.1 gave several versions as follows in cross examination:

“I do not know since how many years prior to giving of complaint A.1 has been working in that RPF outpost, Bapatla. Since five or six 16C.C.7/2011/Prl. CBI Court/VSP months prior to giving of complaint I have been seeing A.1 at tea stall besides my shop. He used to come along with his staff to that tea stall to have tea. I never talked to A.1 though I have seen him in that Tea stall. None of the staff in RPF or other police came to my shop prior to the complaint. About four or five staff of RPF outpost used to come to the tea stall besides my shop including A.1 and D. Srinivasa Rao (who was earlier added as A.2 and now discharged by Hon'ble High Court in

Revision petition). Except in phone I cannot identify the voice of the said four or five staff including A.1 and D.Srinivasa Rao who used to come to the tea stall.” iv)The aforementioned own evidence of P.W.1, makes it abundantly clear that prior to the complaint under Ex.P.1, though he had seen A.1, four or five staff of RPF outpost and D. Srinivasarao, who was earlier A.2 in this case they never came to his shop. This admission itself falsifies the version in

Ex.P.1 that since one month prior to Ex.P.1, A.1 was coming to his shop and demanded bribe.

v)Be that as it may, at page no.11 for the specific question whether he heard personally the voice of A.1, P.W.1 deposed as follows:

“I did not hear personally except in the phone calls by the date of giving complaint. Witness adds only at the time of demanding the amount he personally talked to A.1 and heard his voice. Prior to 10.8.09 I did not meet A.1 personally” vi)This also disproves the version of prior demands of A.1 by personally coming to the shop of P.W.1. Hence, from the aforementioned evidence it can be deciphered that PW.1 did not even meet A.1 personally.

vii)At page 9 strangely P.W.1 deposed as follows:

“For the first time, I talked to him (A.1) on 10th July, 2009. For about every four days thereafter, I talked to A.1 till the date of incident.For about 8 times I talked to A.1 over phone prior to complainant” 17C.C.7/2011/Prl. CBI Court/VSP viii)According to his own .W.1 when he only heard the voice of A.1 over phone and never met him personally prior to Ex.A.1 and A.1 was harassing, there cannot be any necessity to make 8 calls. In addition to that it appears to be highly improbable and unnatural. Even otherwise the details as to the necessity and context of making eight calls to A.1 prior to Ex.P.1 are not forthcoming. Even according to P.W.1 none other witnesses are having knowledge about those facts except himself. When the said facts are crucial to explain the back ground of alleged demand dated 9.8.09 and burden of proving fact especially within the knowledge of any person is upon him under sec.106 of Evidence Act, the very silence on the part of P.W.1 in keeping those facts as closely guarded secrets necessarily leads to adverse inference against him.

28.DEMAND DATED 9.8.09:

In this context, para 2 of Ex.P.1 reads as follows:

“నినన్నా అనగా 09.08.2009 ఆదివారట్టిం నడు Pratap RPF Constable ఆయన phone No. 9849277041 నలుట్టిండి నకు phone చేసి 5000/- అతనికి మామలుళలుళ్ళుగా (లట్టించట్టిం) ఇవవ్వట్టిండని ఆ మొతత్తానిన్నా Ready చేసిన తరలువాత అతనికి phone చేసత్తా ఎకక్కడ ఇవావ్వలో చెబలుతనన్నాని చెపప్పారలు..”

29.REASON FOR DEMAND:

The very reason for demand of bribe, according to P.W.1 mentioned at page no.1 of his chief examination is to make him run his business smoothly.

In cross examination, he deposes that in initial stages of business his annual turnover was Rs.25 lakhs and by the date of complaint his annual turnover was Rs.40 lakhs and he got profit from the business all the years. Further

P.W.1 categorically admits as follows at page No.10 of cross examination:

18C.C.7/2011/Prl. CBI Court/VSP “It is true that by the date of trap of A.1 I was running my business smoothly.”

30.Hence, it is not that there were any set backs in the business of P.W.1 during the relevant point of time and to allow smooth running of his business

A.1 demanded. Thus, the said reason appears to be an outright lie.

31.PENDING OFFICIAL WORK AND ALLEGED THREAT IN EX.P.1:

Regarding any pending official work of P.W.1 with A.1, P.W.1 admits as follows at page No.9:

“It is true that A.1 is not competent to book cases against scrap merchants.

Whereas at Page No.2, P.W.3/ RPF SI of same station admits as follows:

“It is true that duty of constable is only to assist the Officer. It is true that constable independently do not have any powers to act against any suspect or offender of the Railway properties. It is true that constable do not have powers of search, seizure and arrest of the suspect.”

P.W.11/TLO admits as follows at page 13:

“It is true that by the date of trap no official work of P.W.1 was pending with A.1.”

32.Hence, from the testimonies of aforementioned crucial witnesses of the prosecution i.e., complainant/P.W.1, P.W.11/TLO and RPF SI, Bapatla/P.W.3, it is crystal clear that there was no official work of P.W.1 pending with A.1 by the date of alleged demand and A.1 who was only in the cadre of RPF constable was not competent at that point of time to act against any suspect and offender of properties and book cases against the scrap merchant and thus cannot cause any inconvenience for smooth running of business of P.W.1 or harass P.W.1.

19C.C.7/2011/Prl. CBI Court/VSP

33.In this back drop alleged threat in Ex.P.1 complaint that “ఆయన చెపప్పాన విధట్టింగా Rs.5000/- లట్టించట్టిం ఇవవ్వని పకట్టింలో ఏదో ఒక case పెటట న shop మమూత పడేలా చేసత్తానని బెదిరిసలుత్తానన్నాడు ” and testimony of P.W.1 repeating the same is absurd on the face of it and cannot be true.

34.CALLS BETWEEN A.1 AND P.W.1:

In this connection, Learned counsel for A.1 assiduously submitted that it is the duty of prosecution to establish that A.1 has been using the cell phone bearing No.9849277041 and he is the owner of the said phone and he himself called P.W.1 at 10.08 a.m., on 9.8.2009 to the mobile of P.W.1 and demanded bribe since in Ex.P.1 complaint, Exs.P.2 and P.3 pre and post trap proceedings and testimony of P.W.1 making alleged demand from the said number is specifically mentioned and the evidence on record do not fortify the said version of prosecution.

35.EVIDENCE OF NODAL OFFICERS:

In this connection, the testimonies of P.W.7 Nodal Officer, Airtel and

P.W.6 Senior General Manager, Legal, Idea Cellular Limited are important.

P.W.7 filed call data under Ex.P.16. P.W.7 deposed that on the request of CBI, he furnished call particulars and ownership particulars of mobile 9849277041 in letter dated 4.5.2010 stating that the said cell phone belongs to Mr.M.

Vijay of Anantapur and Mobile No.9701373718 belongs to O/o Senior DST

E/M, South Central Railway, Post Incharge/RPF/CLX.

36.In this connection, P.W.4/retired SI, RPF, Vijayawada deposed that he joined as Assistant Sub-Inspector in RPF Outpost, Bapatla in April, 2007 &

Bapatla outpost is in Chirala Circle and earlier A.2 was Inspector, RPF Chirala in August, 2009 and he got acquaintance with A.1 and earlier A.2 and he 20C.C.7/2011/Prl. CBI Court/VSP used to talk to them in official matters & official phone number of Chirala RPF

Inspector is 9701373718 and official number of Sub Inspector RPF Bapatla is 9701373719

37.Further P.W.11/TLO also admitted at page No.13 that he did not verify the ownership of SIM present in M.O.11 cell phone (allegedly seized from

P.W.1) by sending the same to service provider and cell number is not mentioned in the SIM card and he cannot say the cell number of M.O.11 and

SIM card therein. Even P.W.14/IO admits at page No.3 that one M.Vijay of

Anantapur is the owner of cell phone bearing No.9849277041.

38.Hence, there is overwhelming evidence of the prosecution to show that A.1 is not owner of the said cell phone and though M.O.11 cell phone was allegedly seized by P.W.11, either P.W.11 or P.W.14 did not verify which

SIM, A.1 was using in M.O.11 cell phone by 9/10.8.2009.

39.P.W.1/complainant simply deposes that because as A.1 demanded from cell No.9849277041 he thought this belongs to A.1. At one stage of cross examination P.W.1 deposed that except in phone he cannot identify the voice of A.1 and never talked to RPF persons and he doesn't have telephone numbers of RPF Personnel, even out side the RPF Post, Bapatla. Quite contrary to the same in later part of cross examination at page 9 he deposes that he noted down the Cell Number 9849277041 one month prior to Ex.P.1 complaint and for about eight times according to P.W.1 he talked to A.1 over phone prior to complaint commencing from 10.7.2009. When according to

P.W.1 for the first time demand for Rs.5,000/- was made by P.W.1 from his cell phone on 9.8.2009, for what purpose eight times P.W.1 talked to A.1 prior to

Ex.P.1 itself is not explained by P.W.1 or any other witnesses. More particularly when according to the own admission of P.W.1 none of the RPF 21C.C.7/2011/Prl. CBI Court/VSP staff including A.1 and other police visited his shop prior to the complaint

dated 10.8.2009 there cannot be any special work of P.W.1 to talk to A.1

eight times over phone and feeding number of A.1 in his cell phone one month prior to the complaint.

40. Be that as it may even after knowing through Ex.P.16 that registered owner of the SIM number is that of M. Vijay, Ananthapur, IO did not investigate about any connection between the said Vijay and A.1. There is absolutely no evidence on this crucial point.

41.Turning to the evidence of P.W.6/Senior General Manager, Legal, Idea

Cellular Limited, the tower number regarding alleged call for demand at 10.08 a.m., on 9.8.2009 is 40407-302-25401 and A.1 was doing duty at

Railway station, Bapatla from 6.00 a.m., to 2.00 p.m., as deposed by P.W.3/SI,

RPF, Bapatla. Even as per Ex.P.9 duty roster from 6.00 a.m., to 2.00 p.m., A.1 was on duty at Railway Station, Bapatala on 9.8.2009. Prosecution did not make any investigation as to from which tower at 10.08 a.m, on 9.8,2009 call was made from 9849277041 to 9848714481 of P.W.1.

42.P.W.7 deposed at page no.2 that on 9.8.2009 there was an outgoing call from 9849277041 to 9701373718 at 9.09 a.m., and tower location is

Netaji Nagar, Ponnuru, Guntur District. If really A.1 was using cell phone bearing No.9849277041 on 9.8.2009, he would not have made call from

Netaji Nagar, Nidubrolu, Ponnuru, Guntur District while discharging his duties from 6.00 a.m., to 2.00 p.m., on 9.8.2009 at Railway station, Bapatla. Even tower location in respect of call at 10.08 a.m., to mobile of P.W.1 from 9849277041 is SiKharam vari street, Bapatla though A.1 was working in RPF

Station, Bapatla during that time. Hence, prosecution failed to establish the using of Cell number 9849277041 either on 9.8.2009 or 10.8.2009 by A.1 22C.C.7/2011/Prl. CBI Court/VSP and owner of the said phone number was not examined to prove that A.1 was using the said number.

43.When prosecution evidence itself reflects that A.1 is not the registered owner of the said cell phone and A.1 was in discharge of duty during the relevant time consequently entire case of A.1 making call from the said mobile number to P.W.1 at 10.08 a.m., on 9.8.2009 from tower located at

Sikharamvari street, Bapatla, is proved to be false. Further when P.W.1 deposes that he has no acquaintance with the cell numbers of RPF personnel it is strange to claim that A.1 called him from the said number and demanded the amount more particularly when A.1 was on duty form 6.00 a.m., to 2.00 p.m., on 9.8.2009 and tower location for outgoing calls from 9849277041 at 9.09 a.m., and at 10.08 a.m., from Netaji nagar, Niduprolu,

Ponnuru or Sikharam vari street, Bapatla.

44.Further when admittedly there was no prior acquaintance and prior demands since one month proved to be false and no pending official work of

P.W.1 with A.1, during the relevant time how can A.1 who is an utter stranger call P.W.1 and demand Rs.5,000/- towards illegal gratification and threaten to book cases against him and close his shop when he is not competent to do so. When P.W.1 is the sole person to clarify all the aspects of prior acquaintance, back ground of demand, reason for demand etc., reading of entire testimony of PW.1 shows many inconsistent versions on these crucial aspects and it is improbable, unbelievable and not credit worthy regarding the on 9.8.09. Though proof of demand is indispensable essentiality

and permeating mandate for an offence under secs.7 and 13 of

P.C.Act, 1988, prosecution miserably failed to prove the alleged

demand dated 9.8.09.

23C.C.7/2011/Prl. CBI Court/VSP

45.EXS.P.2 AND P.3 PRE TRAP AND POST TRAP PROCEEDINGS:

The version of prosecution in this connection is in pre trap conversation between P.W.1 and A.1 allegedly recorded in the presence of trap team and independent witnesses A.1 stated that he would come to the shop of P.W.1, and entire trap team including P.W.1 went by walk from Sai Bhavana

Residency wherein the pre trap proceedings took place to the shop of P.W.1 which is near by and waited outside the shop and TLO instructed P.W.2 to go along with P.W.1 to observe the conversation and to inform the same and also instructed P.W.1 to give pre arranged signal with kerchief after A.1 demanded and accepted the bribe and around 2.20 p.m., A.1 called P.W.1 by making gesture standing in front of his shop and thereafter P.W.1 and 2 who were waiting in the shop of P.W.1 came out and followed him to the tea stall and after going to the tea stall P.W.1 started conversation as follows:

“రరైలేవ్వ సమానలులలు అవి నేనలు ఏవి కొనటట్టింలేదలు. డబలుబ్బులలు ఇలా అడగదలుద్ద. నేనలు రరైలేవ్వ సక్కస్క్రాప్ కొనటట్టింలేదలు.

ననలున్నా అడగదలుద్ద.

and on hearing that A.1 stated that “సరే ఈ సరికి ఇవవ్వ” and A.1 again stated that:

“వాళళ్ళు ఆఫీసరలుట్ల ఎవరో అడిగారలు అట్టిందలువలట్ల నేనలు అడగవలసివచచట్టింది.” and by stating so he chastised them and demanded bribe of Rs.5,000/- and accordingly amount was given to him with right hand by taking it from left side shirt pocket and A.1 took the said amount with right hand and about to keep the amount in back pocket and at that stage P.W.1 gave pre arranged signal with kerchief and on seeing two officers taking tiffin in that tea stall, 24C.C.7/2011/Prl. CBI Court/VSP

A.1 got doubt and threw money on ground and both officers came and caught hold of A.1 and when A.1 was questioned about the amount he stated that on instructions of his officer D. Srinivasarao, RPF Inspector, Chirala, he took that amount and thereafter chemical tests conducted for both hands of

A.1 yielded positive result and amount thrown by A.1 fell on a news paper.

46.Learned counsel for A.1 urged that there are inconsistencies, improvements and omissions on these aspects and prosecution failed to prove even demand and acceptance during pre trap and post trap proceedings.

47.Adverting to the omissions in cross examination, P.W.1 admits to have omitted to state in sec.161 Cr.P.C., statement that thereafter A.1 stated “సరే ఈ సరికి ఇవవ్వ. వాళళ్ళు ఆఫీసరలుట్ల ఎవరో అడిగారలు అట్టిందలువలట్ల నేనలు అడగవలసివచచట్టింది అని వాళళ్ళుని తిటట సరే డబలుబ్బులలు తెచచవా నలువవ్వ అని డబలుబ్బులలు ఇమమ్మనడు.”

48.Further P.W.1 also admits to have omitted in sec.161 Cr.P.C., statement that “on seeing the two officers taking tiffin in that tea stall A.1 got doubt and threw the money on ground and he and L.W.2 on seeing catching hold of

A.1 started going towards his shop.

49.Not only in sec.161 Cr.P.C., statements P.W.1 further admits omissions of the said sentences of A.1 and P.W.1 in Exs.P.4 and P.5 transcriptions of

C.Ds.1 and 2 Hence, there is absolutely no proof regarding the alleged conversation between A.1 and P.W.1 at tea stall said to have been recorded through digital voice recorder and transferred to C.Ds.1 and 2.

50.EX.P.8 ROUGH SKETCH, ACCEPTANCE AND RECOVERY OF M.O.1:

25C.C.7/2011/Prl. CBI Court/VSP

Prosecution evidence manifests inconsistent versions in respect of acceptance and recovery of M.O.1.

51.P.W.1/complainant simply repeated the version of prosecution in chief examination. He clearly deposed that on the road in front of tea stall, he paid bribe of Rs.5,000/- and A.1 got doubt and threw the amount on ground.

But the case of prosecution is after accepting the bribe A.1 went to the KIOSK and kept the amount inside the KIOSK and admittedly amount was recovered from KIOSK but not from the ground.

52.In this connection, the details drawn in Ex.P.8 rough sketch drawn by

TLO and Ex.D.1 photograph of tea stall, tiffin centre, pan shop and KIOSK are admitted by P.Ws.1,3 and P.W.11.

53.In this connection, P.W.1 himself at page 10 admits as follows:

“By standing in tiffin centre itself I have given pre arranged signal.

After waiting for five or ten minutes in tiffin centre, I gave bribe amount to A.1. It is true that on Municipal Road only the said tiffin centre was erected. It is true that we went to the tiffin centre now shown in Ex.D.1 photograph. It is true that Ex.D.1 shows pan bunk and tea stall. It is true that Ex.D.1 also shows KIOSK fixed in tiffin centre for keeping the vessels. In between the tea stall and tiffin centre on road M.O.1 tainted amount was recovered. The details shown in

Ex.P.8 sketch are correct. M.O.1 was recovered from the road in front of tiffin centre. Inspector Ramarao directed Bank Manager, Ramarao (L.W.3) to pickup M.O.1 from road in front of tea stall. Witness adds it was picked up from tiffin centre.”

54.The aforementioned testimony of P.W.1 itself shows different versions regarding place of recovery. In same cross examination three times he deposed that on road M.O.1 (tainted amount) was recovered and at one stage he deposed that M.O.1 was recovered from tiffin centre.

26C.C.7/2011/Prl. CBI Court/VSP

55.P.W.1 admits as follows in this connection:

“It is true that in Ex.P.3 (Post trap proceedings) it is mentioned that

M.O.1 was recovered from inside the tea stall of the tiffin centre by

CBI officials. At the time of recovery of M.O.1, owner’s son of the tea stall namely Das was present.”

56.TESTIMONY OF D.W.1:

The said Das was examined by A.1 as D.W.1. Admittedly, D.W.1 was present at the time of recovery of M.O.1 and signed in post trap proceedings also but prosecution failed to examine him. D.W.1 deposed in chief examination that on the date of trap between 2.00 to 3.00 p.m., A.1 came to his hotel for having tea and after he ordered tea he made the same and served him and when he stood on the road opposite to his tea stall and while A.1 was having tea, P.W.1 came and offered the amount to A.1 and requested him to handover that amount to CI, RPF, A.1 refused to take that amount and asked him to deal this amount directly with CI, RPF and stepped backwards and while stating so, left the place and P.W.1 himself kept the said amount in KIOSK where he used to keep the vessels and two or three persons came to that KIOSK and took that amount and left along with

P.W.1 and on that day he was examined by CBI and distance between place of offering money to A.1 and the place where the amount was kept is about 20 to 30 feet and his signature was also obtained in Ex.P.3 post trap proceedings between 8 to 9.00 p.m.

57.In cross examination he strongly denied the suggestion that M.O.1 was recovered from tea stall but not from KIOSK and P.W.1 never kept M.O.1 amount in that KIOSK and A.1 accepted the amount and only on suspicion he had thrown that amount and it fell inside the KIOSK due to that act.

27C.C.7/2011/Prl. CBI Court/VSP

58.In this connection, it is necessary to have an insight into Ex.P.3 post trap proceedings. According to the last para in page no.2 it is mentioned that after arrest of A.1 and questioned about where he kept the tainted amount of Rs.5,000/- he disclosed in the presence of independent witnesses that after accepting the amount he grew suspicious and dropped the same on a newspaper lying on the floor of tea shop and showed the said amount and bundle of tainted currency notes found lying on the said news paper on the floor of tea shop was recovered on the said statement made by

A.1.

59.Turning to the evidence of shadow witness/P.W.2, he deposed at page no.2 that around 2.20 p.m., one person stood in front of the shop and called

P.W.1 by gesture and P.W.1 was going out of the shop by stating that he was

A.1 and he also started walking and there was a gap of around ten feet between himself and P.W.1 and A.2 and both of them were talking by walking towards road. But the said conversation at the time of walking was not audible to him and both A.1 an A.2 went together into the tea shop and after going there A.1 made gesture with his fingers as if demanding amount from P.W.1 and thereafter P.W.1 took out the amount from his shirt pocket with his right hand and offered the same to A.1 and A.1 took the said amount with his right hand and A.1 changed his hand and kept the amount in the left hand and on suspicion he had thrown the amount on the floor. But again P.W.2 stated that prior to throwing of the amount A.1 kept the said amount in his pocket.

60.P.W.1 or P.W.11/TLO never stated that A.1 kept the amount in back pocket before throwing the same. Hence, the said part of testimony of P.W.2 is inconsistent with the testimonies of P.W.1 and P.W.11.

28C.C.7/2011/Prl. CBI Court/VSP

61.VISIBILITY TO P.W.2:

Regarding visibility of P.W.1 and A.1 to him, he deposed that he was standing about 10 feet away from the tea stall wherein P.W.1 met A.1 and there were three or four customers in tiffin centre at that time and faces of

P.W.1 and A.1 were visible from the place where he stood. But categoricaly admits as follows at later part of cross examination:

“It is true that from the place where I stood it will not be visible clearly whether A.1 had voluntarily accepted the amount or at the time of paying the amount MO1 fell on the floor.”

62.P.W.2 also deposes that the details mentioned in Ex.P.8 rough sketch are correct and it shows road in front of tea stall as main road and road in front of CTO office as bye-lane and distance between the place where he stood before CTO office and tiffin centre is 20 feet. When P.W.2 clearly admits in pages 6 and 7 that in front of CTO office only he stood which is 20 ft., away from A.1 and P.W.1 for observation of demand and acceptance between

P.W.1 and A.1 and tea stall is on main road and CTO office in a bye-lane, it cannot be said that he observed closely the events going on in the tea stall or the conversation between P.W.1 and A.1.

63.Even Regarding alleged throwing of amount by A.1 and making gestures by A.1 to P.W.1 after going to the tea shop he admits as follows:

“It is true that in sec.161 Cr.P.C., statement and post trap proceedings it is not mentioned that 'after going there A.1 made gesture with his fingers as if he is demanding the amount from P.W.1.' “It is true that in sec.161 Cr.P.C., statement and post trap proceedings it is not mentioned that 'on suspicion A.1 had thrown the amount on the floor and tried to keep the said amount in his pocket.” 29C.C.7/2011/Prl. CBI Court/VSP

64.In page No.6 P.W.2 admits that he omitted to state in sec.161 Cr.P.C., statement that in pre trap proceedings in first spell of conversation recorded through Digital voice recorder P.W.1 stated that he brought the amount of

Rs.5,000/- demanded by A.1 on the previous date and A.1 said OK and stated that he would come to the shop of P.W.1. P.W.2 further admits that the said conversation is also not mentioned in transcription and Ex.P.2 post trap proceedings.

65.The aforementioned omission of important facts in sec.161 Cr.P.C., statement, pre trap and post trap proceedings itself shows the improvements and embellishments in the case of prosecution.

66.Regarding place of recovery he categorically admits as follows at page no.7:

“It is true that according to post trap proceedings M.O.1 was recovered from the KIOSK in tiffin centre. It is true that according to post trap proceedings M.O.1 was lying on a paper which is on the floor of

KIOSK in tiffin centre. Mediator bent into the KIOSK and picked up

M.O.1 from the paper lying on the floor. The distance between KIOSK and tea stall is ten feet. The KIOSK and tea stall are adjoining. It is true that according to Ex.P.8 rough sketch alleged transaction of payment of bribe took place when A.1 stood in front of pan shop which is situated to the rest of the said tiffin centre. It is true that Ex.P.8 shows that A.1 and P.W.1 stood in front of pan shop at the time of the alleged transaction. At the time of recovery M.O.1 was like a bunch of notes.”

67.The aforementioned testimony of P.W.2/shadow witness clarifies the actual place of recovery of M.O.1 is not directly from floor or news paper on the floor and on the other hand, M.O.1 was on news paper lying on the floor of KIOSK in the tiffin centre which runs contra to the version in Ex.P.3 Post trap proceedings. If distance between KIOSK and tea stall is ten feet, as deposed by P.W.2 in page no.7 person stood in front of tea stall on road 30C.C.7/2011/Prl. CBI Court/VSP cannot throw away money into the floor of KIOSK. Secondly if it is thrown from that distance bundle of notes will not be kept in tact. The very evidence of all the crucial witnesses of prosecution that M.O.1 was recovered like a bundle of notes itself destroys the version that on suspicion A.1 thrown

M.O.1 from the distance of ten feet and as such it fell on the news paper present in KIOSK.

68.Further, to sum up testimony of P.W.2 regarding alleged making of gestures by A.1 as if he was demanding the amount and alleged giving of amount by P.W.1, after making the gestures, and accepting the amount by

A.1 and trying to keep them in his pocket by A.1 and changing the money into left hand and on suspicion thrown the amount on floor cannot be believed in view of his own admission that they will not be visible from the place where he stood.

69.STANDING POSITION OF P.W.11 AS PER EX.P.8:

Turning to the testimony of P.W.11, he deposed in cross examination that he had shown position of members of team who witnessed the transaction between A.1 and P.W.1 and he along with independent witness R.V. Rama Rao stood together and witnessed the incident between

A.1 and P.W.1 and place of waiting of members 1 and 2 of the waiting team was separately shown in Ex.P.8 rough sketch and after reaching the scene of offence he and his team nearly waited for one hour for receiving pre arranged signal. Ultimately regarding the place of his waiting before receiving signals from P.W.1, he admits that Ex.P.8 rough sketch doesn't specifically disclose his name and that he witnessed the transaction though names of persons whoever witnessed the transaction and their positions are 31C.C.7/2011/Prl. CBI Court/VSP mentioned and according to the rough sketch M.O.1 was recovered from

KIOSK, as shown in the rough sketch.

70.The aforementioned testimony of TLO clearly shows that place of recovery of M.O.1 is from the KIOSK and it is shown in Ex.P.8 rough sketch and Ex.D.1 photo. But P.W.1/ complainant did not depose about the same and according to him place of recovery of M.O.1 is from the News Paper lying on the floor of tea shop though P.W.2 also admits the place of recovery as TLO.

71.Further, even regarding the topography P.W.11/TLO admits that tea stall is situated on the main road and bye-lane is towards the west of tea stall in South-North direction. He could not say that persons waiting in bye- lane cannot see the persons in front of the tea stall. Further regarding post trap proceedings he also admits to have omitted to mention that he witnessed that both P.W.1 and A.1 walked towards nearby tea shop and after a brief conversation P.W.1 took out money from his shirt pocket with his right hand and accused accepted the same with his right hand and after that P.W.1 proceeded to his shop and while proceedings he gave pre determined signal by wiping his face with kerchief and at the same time accused transferred something from his right hand to his left hand and turned back walking near the tea shop and put something in the tea shop.

72.P.W.11 further admits that P.W.1 did not state while recording his version in post trap proceedings that “thereafter myself and P.W.2 went out and followed him to that tea stall and after going to that tea stall, I started conversation by stating that రరైలేవ్వ సమానలులలు అవి నేనలు ఏవి కొనటట్టింలేదలు. డబలుబ్బులలు ఇలా అడగదలుద్ద.

నేనలు రరైలేవ్వ సక్కస్క్రాప్ కొనటట్టింలేదలు. ననలున్నా అడగదలుద్ద' and thereafter A.1 stated that సరే ఈ సరికి ఇవవ్వ' 32C.C.7/2011/Prl. CBI Court/VSP and A.1 also stated that వాళళ్ళు ఆఫీసరలుట్ల ఎవరో అడిగారలు అట్టిందలువలట్ల నేనలు అడగవలసివచచట్టింది' and that A.1 was about to keep the amount in back pocket.”

73.The aforementioned very reason of demanding the amount and explanation of P.W.1 that because he was not selling railway scrap he should not be demanded to pay bribe and ultimately inspite of it he was demanded to pay the amount as last occasion on the ground that other officers demanded, is total improvement and admitted by P.Ws.1,2 and P.W.11/TLO and as such it is not mentioned even in transcription of the conversation.

Hence, the aforementioned version cannot be accepted intoto regarding the demand and acceptance.

74.At page no.12 P.W.11 also admits that during post trap proceedings

P.W.2 did not state that after going there A.1 made gesture with his fingers as if he was demanding the amount from P.W.1 and that on suspicion A.1 thrown the amount on the floor.

75.In the light of the admission of P.W.11/TLO that M.O.1 was not recovered from the road in front of the tea stall and A.1 did not throw away the amount by standing in front of tea stall in para No.4, page 12 disproves the version of complainant on the said aspects. The very admission of P.W.11 at page no.12 that M.O.1 notes were in bundle and not spread loosely itself shows that they were not thrown by A.1. from the road on tea stall. Curiously colour tests were conducted according to P.W.11 on the road in front of tea stall and thereafter because it is a public road and not convenient to conduct post trap proceedings they shifted to the CTO office which is opposite to the tea stall.

76.A careful reading of the testimonies of crucial witnesses i.e.,

P.W.1/complainant, P.W.2/shadow witness and P.W.11/TLO clearly shows 33C.C.7/2011/Prl. CBI Court/VSP inconsistent versions in respect of the crucial aspects of alleged gestures made by A.1 to P.W.1 demanding the amount, acceptance of the same and alleged throwing of the amount on suspicion and alleged watching of the conversation by others and place of recovery of M.O.1 and they are unworthy of crdence. In addition to that there are lot of improvements and omission as discussed supra. As such, they do not inspire any confidence. On the other hand, they generate serious doubt about veracity of evidence of prosecution witnesses.

77.ALLEGED DEMAND FOR HIMSELF OR OTHERS:

The very version of prosecution that on the instructions of earlier A.2

D. Srinivasarao, Inspector, RPF, South Central Railway, Chirala, the said amount was collected by A.1 and after A.1 disclosed the same on questioning him after arrest, conversation was recorded by making A.1 to call earlier A.2

D. Srinivasa Rao and when P.W.1told the said D.Srinivasa Rao that he paid the amount, he conveyed thanks and asked A.1 to keep the amount in a cover and send the same through RPF SI and when P.W.3 was accordingly requested by TLO to give the cover containing M.O.1 to D.Srinivasarao, he refused to do so assuming for a moment is correct ipso facto shows that A.1 never received the amount for himself and he only took the amount as per the instructions of the said Srinivasarao to hand over the same to him. At

page No.30 P.W.11/TLO admits that MO1 amount was sent to P.W.3

through A.1 only to trap A.2 and since he refused to accept and

handover M.O.1 to earlier A.2 D. Srinivasarao, A.2 could not be

trapped.

78.In this connection, prosecution even examined P.W.3, SI, RPF, Bapatla through whom Ex.P.9 true copy of duty roster in respect of the duty of A.1 34C.C.7/2011/Prl. CBI Court/VSP was marked. In cross examination he deposed that A.1 brought sealed cover to him and at about 5.50 p.m., he was taken into CTO office and thereafter he signed in Ex.P.3 and in his presence except writing, other proceedings did not take place. Hence, prosecution even proved through P.W.3 that he refused to receive the sealed cover containing M.O.1 sent to him through A.1 by TLO. Since earlier A.2 was discharged by Hon'ble High Court, the very first charge of conspiracy between A.1 and A.2 under sec.120-B IPC and charges 3 and 5 against earlier A.2 under sec.7 and 13(1)(d) r/w 13(2) of P.C. Act, 1988, are no more necessary and not discussed. Hence, the own evidence of prosecution established that A.1 has neither demanded nor received bribe amount for himself in discharge of his official duties.

79.RECORDING VOICE SAMPLES, TRANSCRIPTIONS ETC.:

In respect of recording of conversation, obtaining voice samples, preparing transcriptions etc., P.Ws.9 and 11 were examined and Exs.P.4 to P.7 (transcriptions), P.19, P.21 and P.23 proceedings in respect of obtaining sample voice of P.W.1, A.1 and D. Srinivasarao (earlier A.2) respectively and transcriptions of sample voice of P.W.1 (P.20), A.1 (P.22), A.2 (P.24) were marked. M.O.2 (C.D.No.1) is conversation between P.W.1 and A.1 during pre trap proceedings. M.O.9 (C.D.No.2) is conversation between A.1 and P.W.1 at the place of trap regarding the alleged demand and acceptance of M.O.1 tainted amount during post trap proceedings. M.O.10 (C.D.No.3) is conversation between A.1, P.W.1, D. Srinivasarao (earlier A.2). Ex.P.4 is proceedings of preparation of transcriptions of proceedings drawn on 8.1.10.

Exs.P.5 to P.6 are transcriptions of C.Ds.1 to 3.

80.Coming to C.D.1, it is the conversation allegedly recorded during pre trap proceedings by making P.W.1 to call from his cell phone by putting the 35C.C.7/2011/Prl. CBI Court/VSP same in speaker mode and also recorded in the Digital Voice Recorder and informing A.1 that he made the amount of Rs.5,000/- ready and the contents in Digital Voice recorder were transferred to C.D.No.1 and marked as M.O.2.

Further conversation between A.1 and P.W.1 recorded through Digital Voice

Recorder during post trap proceedings before recovery of the amount is

M.O.9. Whereas conversation between A.1, Dasari Srinivasarao (earlier A.2) and P.W.1 recorded through Digital Voice recorder after conducting of chemical tests and alleged information given by A.1 about D. Srinivasarao was transferred to C.D.No.3 according to prosecution is M.O.10.

81.SPECTROGRAPHY REPORT:

In this connection, P.W.13/Scientific Officer, CFSL, Chandigarh, to whom

M.Os.2,9 and 10 were allegedly sent along with sample voices of A.1 (Ex.P.22), D.Srinivasarao (Ex.P.24) and P.W.1 (Ex.P.21) drawn under proceedings Exs.P.19, P.21, P.23 were sent for spectrogrpahy test deposed that he examined all the exhibits thoroughly using different software and tools and issued Ex.P.33 report dated 21.12.2010. Ex.P.33 report mentions as follows regarding CDs., 1 and 2 (M.Os.2 and 9):

“no opinion could be formed for comparison of Q.1 with S.1 and Q.2 with S.2 as sufficient number of clue words required for comparison could not be obtained from noisy questioned conversations.”

Whereas regarding M.O.10 (C.D.3 i.e., conversation between P.W.1, A.1 and earlier A.2) he opined that :

“Questioned voice sample is the voice of same person that is Sri

A.Vijay with high probability.”

In cross examination he admits that conversation in Q.1, Q.2 is noisy.

He could not say how much part of Q.1, Q.2 is audible.

36C.C.7/2011/Prl. CBI Court/VSP

82.Hence, from the aforementioned testimony of P.W.13 and Ex.P.33 spectography report no opinion was given in respect of C.Ds.1 and 2 i.e.,

M.Os.2 and 9 which are crucial to prove demand and acceptance of the alleged amount of Rs.5,000/-. Therefore, the version of prosecution that even C.Ds., prove the demand and acceptance is not correct.

83.PHENOLPHTHALEIN TEST AND REPORT:

Turning to chemical test report, Ex.P.18 CFSL report dated 31.3.2010 was marked through P.W.8. M.Os.3 to 5 are sealed bottles of right hand wash of A.1, left hand wash of A.1 and swab wash of news paper (M.O.6) on which

M.O.1 was recovered. During the cross examination of P.W.2/Shadow witness at the time of marking M.Os., it was noted that M.Os.3 and 5 are empty and

M.O.4 contains little quantity of abut 5 to 10 ml., of solution an the same is mentioned in the deposition itself.

84.At this juncture it would be apt to refer to P. Parasuramireddy Vs.

State of A.P. reported in 2012 (1) SCC (Crl.) 552 whereinregarding the importance of Chemical tests (Phenolphthalein test) Apex Court erudite as follows:

“A single circumstance by itself may not be able to establish that money was demanded and and it was accepted as bribe, it could have been the possiblity that complainant might have touched the currency notes and had shaken the hand with the accused or it could be that any one of the investigating officers or the member of the raiding party had touched the fingers of the accused. That circumstance itself cannot be ruled out. We have seen the judgments of the Court below wherein the sole evidence of the fingers being soiled in Sodium carbonate turned pink has been relied upon. Both the Courts below seem to have impressed by this situation alone. We do not feel it 37C.C.7/2011/Prl. CBI Court/VSP sufficient to convict the accused on this evidence alone and we would choose to give him the benefit of doubt.”

85.Though according to prosecution Chemical tests yielded positive results under Ex.P.18 report, it hardly leads to any consequence in the light of the aforementioned inconsistent and weak more so when D.W.1 at whose tea shop all these events took plae clearly stated that the A.1 refused to receive the amount given by P.W.1. Further, chemical test report which is only opinion evidence do not have any over riding effect over the direct evidence of witnesses.

86.The sum and substance of the aforementioned reasoning show that there is no acceptable and clinching evidence to prove that there was a demand of bribe and that accused accepted the amount as a motive or reward for doing an official act or for showing a favour to the complainant, prosecution having failed to establish any demand for bribe as alleged no presumption can be drawn under sec.20 of P.C. Act, 1988.

87.In view of the ratio laid down in the afore cited decisions and foregoing discussion, mere positive chemical test report is wholly insufficient to convict the accused in the absence of positive, cogent, concrete and inspiring evidence of complainant, TLO and shadow witness.

88.In this factual scenario, it is inevitable to hold that prosecution miserably failed to establish the guilt of A.1 under sec.120-B of IPC and sec.7 and 13(2) r/w 13(1)(d) of P.C. Act, 1988.

89.In the result, Accused No.1 is found not guilty for the offence punishable under sec.120-B IPC and secs.7 and 13(2) r/w 13(1)(d) of 38C.C.7/2011/Prl. CBI Court/VSP

Prevention of Corruption Act, 1988 and he is acquitted under sec.248(1)

Cr.P.C. The Bail bonds of the Accused No.1, if any, shall stand cancelled. M.O.1 cash of Rs.5,000/- shall be returned to P.W.1/Addanki

Vijay/complainant after expiry of appeal time. M.Os.2 to 11 shall be destroyed after expiry of appeal time. Accused No.1 shall execute a bond of Rs.10,000/- (Rupees ten thousand only) undertaking to appear before the Hon’ble High Court in terms of Sec.437-A Cr.P.C.

Typed to my dictation, corrected and pronounced by me in open Court on this the day 29th day of December, 2017.

Sd/- A. Gayathri Devi

PRL. SPL. JUDGE FOR C.B.I. CASES,

VISAKHAPATNAM.

APPENDIX OF EVIDENCE

LIST OF WITNESSES EXAMINED ON BEHALF OF PROSECUTION.

P.W.1/31.05.17: Addanki Vijay P.W.2/01.06.17: G.B. Ranga Rao P.W.3/01.06.17: P. Venkateswarulu P.W.4/02.06.17: P. Ankama P.W.5/05.06.17: M. Jaya Kumar P.W.6/09.06.17: B. Arun Madhav P.W.7/09.06.17: S. Muralidhar P.W.8/09.06.17: P. Sudhakar P.W.9/21.08.17: Y.E.L. Sudhakr Rao P.W.10/22.08.17: S.V.S. Naidu P.W.11/24.08.17: S.P.Rama Rao P.W.12/11.09.17: S.K. Mishra P.W.13/11.09.17: D.P. Gangwar P.W.14/05.10.17: P.V.S.N. Raju

LIST OF DOCUMENTS MARKED ON BEHALF OF PROSECUTION.

Ex.P.1: Complaint of P.W.1 Ex.P.2: Pre trap proceedings dated 10.8.09 Ex.P.3: Post trap proceedings dated 10.8.09 Ex.P.4: Preparation of transcription of conversation proceedings drawn on 8.1.2010. Ex.P.5: Transcription of C.D.No.1 (5 sheets) Ex.P.6: Transcription of C.D.No.2 (28 sheets) 39C.C.7/2011/Prl. CBI Court/VSP

Ex.P.7: Transcription of C.D.No.3 (4 sheets) Ex.P.8: Rough sketch Ex.P.9: True copy of duty Roster extract dt.9/10.8.09 of RPF, Bapatla Ex.P.10: True copy of duty Roster extract dt.8/9.8.09 of RPF, Bapatla Ex.P.11: Receipt memo dt.5.5.10 Ex.P.12: Attested copy of Transfer proceedings dt.1.11.07 Ex.P.13: True copy of Acknowledgment dt.27.5.05 Ex.P.14: True copy of Daily Dairy extract dt.10.8.09 Ex.P.15: Call details of Idea Cellular Ltd., with letter dt.20.5.2010 issued by P.W.6 to CBI, VSP Ex.P.16: Call details of Bharati Airtel Ltd., with letter dt.12.5.2010 along with sec.65-B certifcate issed by P.W.7 to CBI, VSP. Ex.P.17: Letter dt.9.7.2010 of Bharti Airtel Ltd., issued by P.W.7 to CBI, VSP. Ex.P.18: Opinion of CFSL dt.31.3.2010 Ex.P.19: Proceedings dt.9.1.10 recording of sample voice of P.W.1 Ex.P.20: Transcription of sample voice of A.1 Ex.P.21: Proceedings dt.9.1.10 recording of sample voice of A.1 Ex.P.22: Transcription of sample voice of A.1 Ex.P.23: Proceedings dt.9.1.10 of recording of sample voice of D. Srinivasa Rao Ex.P.24: Transcript of sample voice of D. Srinivasarao Ex.P.25: Original FIR in R.C.15(A)/2009 of CBI, Visakhapatnam. Ex.P.26: Search list dt.10.8.09 Ex.P.27: Inventory list dt.10.8.09 Ex.P.28: Search list dt.11.8.09 Ex.P.29: Inventory list dt.11.8.09 Ex.P.30: True copy of extract of G.D. of RPF dt.10.8.09 along with receipt memo Ex.P.31: Original sanction order dt.20.7.2010 Ex.P.32: Schedule of Administrative and Disciplinary powers of superior officers Ex.P.33: Opinion dt.22.12.2010 Ex.P.34: Receipt memo dt.5.5.2010 Ex.P.35: Office copy of letter dt.29.4.2010

LIST OF WITNESSES EXAMINED ON BEHALF OF DEFENCE.

D.W.1/07.11.17: A. Jobdas

LIST OF DOCUMENTS MARKED ON BEHALF OF DEFENCE.

Ex.D.1 : Photograph

MATERIAL OBJECTS MARKED ON BEHALF OF PROSECUTION

M.O.1: Tainted cash of Rs.5,000/- M.O.2: One C.D. belongs to Telephonic conversation between P.W.1 and Accused (C.D.1) M.O.3: Right hand wash bottle of A.1 M.O.4: Left hand wash bottle of A.1 M.O.5: Bottle containing cotton swab wash of News paper M.O.6: News paper dt.13.8.09 M.O.7: Navya Newspaper dt.24.6.09 M.O.8: Specimen seal impression 40C.C.7/2011/Prl. CBI Court/VSP

M.O.9: One CD belongs to conversation between P.W.1 and accused (C.D.2) M.O.10: One CD belongs to conversation among P.W.1,A.1 and A.2 (C.D.3) M.O.11: Mobile phone (Sony Ericsson)

Sd/- A. Gayathri Devi

PRL. SPL. JUDGE FOR C.B.I. CASES,

VISAKHAPATNAM.

Copy submitted to

The Hon’ble Registrar (Judicial), High Court of Judicature at Hyderabad for the State of Telangana and the State of Andhra Pradesh

Copies to:

1. The Superintendent of Police, C.B.I., Visakhapatnam.

2. The Central Forensic Science Laboratory, Ramanthapur, Hyderabad, State of Telangana

4. The Senior Divisional Security Commissioner, Railway Protection Force, South Central Railway, Divisional Office, Security Branch, Vijayawada-520001 //True Copy //

Prl. Spl. Judge for C.B.I. Cases, Visakhapatnam.

IN THE COURT OF THE PRINCIPAL SPECIAL JUDGE FOR C.B.I. CASES,

VISAKHAPATNAM.

Present: Smt. A. GAYATHRI DEVI, Prl. Spl. Judge for C.B.I. Cases, Visakhapatnam.

Wednesday, this the 10th day of April, 2018

C.C.No.01/2016

Between:

State represented by Inspector of Police, C.B.I, Visakhapatnam.

…Complainant And:

Kota Joji, s/o late Kota Sukhalu, aged 48 years, aged 50 years, Inspector, Railway Protection Force, Eluru Post, Present Residential Address: Flat No.204, Shriya Residency, Satrampadu, Eluru, West Godavari District, A.P., Permanent Residential Address: Village Davajigudem, Gannavaram Mandal, Krishna District, A.P.

…Accused

This case has come up on 06.04.2018 for final hearing before me in the presence of Sri B.S.P. Chowdhary, Ld. Public Prosecutor for the State- Complainant and of Sri G.V.P.B.S.N. Murthy, Ld. Advocate for Accused and the matter having stood over for consideration till this day, this Court doth the following:

J U D G M E N T

The State represented by Inspector of Police, CBI, ACB, Visakhapatnam, filed charge sheet in R.C.01(A)/2015-CBI, ACB, Visakhapatnam, against accused for the offence under secs.7 and 13(2) r/w 13(1)(d) of Prevention of

Corruption Act, 1988.

2.The case of the prosecution, in nutshell as per charge sheet, is as follows:

2C.C.1/2016/Prl. CBI Court/VSP

i)Accused worked as Inspector, RPF, Eluru Post, during the period from 2.5.2012 to 15.2.2015. As an Inspector his duty was to protect and safeguard railway properties, Railway passengers and keep the railway premises free from anti social elements, beggars and unauthorized hawkers/vendors. He was empowered to book cases under railways act, 1989 against the hawkers/vendors found selling eatables and beverages etc., in running trains or on platforms unauthorizedly without license in his jurisdiction.

Complainant has been selling boiled peanuts in trains plying between Eluru and T.P. Gudem with the help of his workers without license. Without preventing the complainant from selling eatables without license, accused started troubling him. When complainant contacted accused at Eluru post, he demanded a bribe of Rs.6,000/- per month for allowing him to continue the said business. In the month of February, 2015 accused along with RPF

Constable, Eluru post, Sheik Subhani visited T.P. Gudem Accused called the complainant to RPF outpost, TP Gudem and questioned him as to why he did not give the bribe as demanded. When complainant expressed his inability to give bribe of Rs.6,000/- per month on the ground that his business was not good, accused warned him that if his demand is not complied before 10.2.2015 he would not allow him to continue the business. Since complainant is not having any other source of income to run his family he visited RPF, Eluru post on 8.2.2015 and informed the accused that he was unable to meet his demand. Even then accused reiterated the same. But subsequently, on informing about his financial hardships accused reduced the bribe to Rs.3,000/- per month and instructed him to pay total amount of

Rs.6,000/- for the months of January and February, 2015 on 15.2.2015 at his office. Since complainant was not willing to give bribe he lodged a complaint

dated 15.2.2015 with CBI, ACB, Visakhapatnam, against the accused. FIR

3C.C.1/2016/Prl. CBI Court/VSP was registered on the said complaint in R.C.1(A)/2015 under sec.7 of P.C. Act, 1988 on 15.2.2015. After securing the presence of two independent witnesses pre trap proceedings was conducted at Room No.3, Foods, Fads and Fertilizers Guest House, TP Gudem between 16.45 hours and 17.40 hours.

ii)After pre trap proceedings CBI team along with independent witnesses and complainant left to Eluru. Complainant followed by Sri P. Venkateswara

Rao, accompanying witness went to RPF Post, Eluru. CBI team and other independent witnesses took vantage positions near RPF post. There is a window on the southern side office room of accused. The accompanying witness took position close to the said window and complainant went into the office room of accused. During that process, complainant asked ASI whether accused was available in the room. The said ASI told him that he was available and instructed the complainant to wait and entered into the office room of accused and came out and thereafter sent complainant into the said room. Accused demanded illegal gratification of Rs.6,000/- from the complainant and complainant took out bunch of tainted notes from his shirt pocket and handed over the same to accused. After counting them accused kept the same in daily dairy of RPF post, Eluru. During post trap proceedings, the colour test to right hand and left hand fingers of accused yielded positive result. Both washes were collected in separate bottles and sealed. Tainted notes of Rs.6,000/- were recovered by M. Satyanarayana, independent witness, from the Daily Dairy of RPF post, Eluru. The colour tests to the surface of brown paper of the Daily Dairy from where the tainted money was recovered also yielded positive result. During post trap proceedings, in personal search of accused, a slip containing his handwritings was recovered 4C.C.1/2016/Prl. CBI Court/VSP and seized in the presence of independent witnesses. Subsequent to the trap, search was conducted in office table drawer pf accused and bunch of papers containing names of vendors/hawkers and amount collected from them in different months as recovered along with cash of Rs.31,020/- was recovered for which accused could not satisfactorily account for. The said slip and bunch of papers contain the handwritings of accused. They were sent to Expert along with specimen signatures. The aforesaid acts on the part of accused constitute offence the offence punishable under secs.7 and 13(2) r/w 13(1)(d) of P.C. Act, 1988.

3.On filing of charge sheet, case was taken cognizance against accused on 18.1.2016 under secs. 7 and 13(2) read with 13(1)(d) of P.C. Act, 1988 and summons were issued to the accused. On appearance of accused copies were furnished.

4.Upon hearing the counsel for accused, 03.11.2016 charges under secs.7 and 13(1)(d) read with 13(2) of P.C., Act, 1988 against accused no.1 and 2 were framed, read over and explained to him for which he pleaded not guilty and claimed to be tried.

5.During trial supplementary charge sheet was filed on the ground of habitual receipt of bribes and on 17.10.2017 accused is further examined under sec.239 Cr.P.C., and denied the charge sheet allegations and further charges were framed for the offence under sec.13(1)(a) r/w 13(2) of P.C. Act, 1988 against the accused, read over and explained to him in Telugu and he pleaded not guilty and claimed to be tried. Since the supplementary charge sheet originates from the contents mentioned in charge sheet in C.C.1/16 and report of handwriting Expert common trial was conducted.

5C.C.1/2016/Prl. CBI Court/VSP

6.On behalf of prosecution, P.Ws.1 to 29 were examined and Exs.P.1 to

P.57 and M.Os.1 to 5 were marked.

7.On completion of evidence on prosecution side, accused was examined under sec.313 Cr.P.C., he denied the incriminating evidence and reported no defence evidence. On behalf of accused, no witnesses were examined and

Exs.D.1 to D.3 were marked in the cross examination of P.W.3.

8.Heard the learned counsel for accused and Learned Public Prosecutor for Prosecution. Perused the material on record and written arguments of both sides.

9.Now the points for determination are:

1) Whether prosecution proved demand and acceptance of illegal gratification and recovery of amount from Accused?

2) Whether prosecution established charge against Accused under sec.7 of P.C. Act, 1988 beyond all reasonable doubt?

3) Whether prosecution established charge against Accused under sec. 13(1)(d) r/w 13(2) of P.C. Act, 1988 beyond all reasonable doubt?

4) Whether prosecution established charge against Accused under sec.13(1)(a) r/w 13(2) of P.C. Act, 1988 beyond all reasonable doubt?

10.POINT NOs.1 TO 3:

1)PROSECUTION CASE:

i)Sans the unnecessary details, the case of prosecution, in brief, is as follows:

Accused in the status of RPF Inspector, Eluru post, demanded a bribe of Rs.6,000/- per month from P.W.1/complainant for continuing unauthorized business of selling eatables etc., in running trains, platforms etc., in his 6C.C.1/2016/Prl. CBI Court/VSP jurisdiction but P.W.1 did not oblige his demand and continuing his unauthorized business and though in the month of February, 2015 accused visited T.P.Gudem along with P.W.8 and questioned P.W.1 for non compliance of demand. P.W.1 expressed his inability to give the alleged bribe on the ground that his business was not profitable and accused there upon warned

P.W.1 that if demanded money is not paid on or before 10.2.2015 he would not permit him to continue the said business.

ii)It is also the case of prosecution that on 8.2.2015 P.W.1 visited office of accused and expressed that he was unable to give bribe as demanded and accused reiterated his demand and warned and inspite of the same when

P.W.1 expressed his inability to pay Rs.6,000/- per month, the amount of bribe was reduced to Rs.3,000/- per month and accused was instructed to pay Rs.6,000/- towards bribe for the months of January and February, 2015 on 15.2.2015 at the office of accused and as such, P.W.1 lodged the compliant on 15.2.2015 against the accused and handed over the same to

P.W.28/TLO who laid trap and accused was caught red handed while demanding and receiving bribe of Rs.6,000/- from P.W.1 and even chemical tests to both hands of accused yielded positive result and accordingly accused is liable to be convicted under sec.7 and 13(2) read with 13(1)(d) of

P.C. Act.

2)DEFENCE OF ACCUSED:

The defence of accused is he is innocent and he neither demanded illegal gratification of Rs.6,000/- nor accepted the M.O.1 tainted amount from

P.W.1 and on the date of trap i.e., 15.2.2015 P.W.1 was in Eluru and the contents in post and pre trap proceedings are false and created to suit the case of prosecution and there is no southern window to the office room of 7C.C.1/2016/Prl. CBI Court/VSP accused and peeping through that window and following the alleged conversation and the happenings in office room of accused prior to the trap by accompanying witness is utterly false and complainant and witnesses were not examined during the post trap proceedings and M.O.5 was not recovered from the possession of accused and accused is liable to be acquitted.

11.BURDEN OF PROOF:

Thereafter decision as to prove demand & acceptance of illegal gratification.

12.In order to prove charge under sec.7 and 13 of P.C. Act, 1988, prosecution has to establish by positive, cogent and succinct evidence the demand and acceptance of illegal gratification. Till that is accomplished accused should be considered as innocent.

13.LEGAL POSITION:

i)Ld. Public Prosecutor placed reliance upon the following citations of various High Courts in support of the case of prosecution:

1. State of A.P. Vs. C. Uma Maheswararao and another reported in 2004 Crl.L.J.2040 wherein under secs.7,13 and 20 with sec.120-B of IPC the

Lordships observed in para 22 as follows:

“In Raghuvir Singh Vs. State of Haryana Justice V.R. Krishna

Iyer speaking for a three judge bench observed that the very fact of an Assistant Station Master being in possession of the marked currency notes against the allegation that he demanded and received that amount is “res ipsa loquitor”.

8C.C.1/2016/Prl. CBI Court/VSP

2. State of A.P. Vs. R. Jeevaratnam reported in 2004 (3) Crimes 210

Supreme Court. This is also relied upon regarding the same observation of “res ipsa loquitor”.

3. M. Narasinga Rao Vs. State of A.P. reported in AIR 2001 SC 318 wherein the Lordships held that :

“Act doesn't say that condition should be satisfied through direct evidence. Its only requirement is it must be proved that accused has accepted or agreed to accept gratification. Direct evidence is one of the modes through which a fact can be proved. But that is not the only mode envisaged in evidence Act.”

4. V.D. Jhan gan Vs. State of U.P. reported in AIR 66 Supreme Court 1762 wherein the Lordships explained about statutory presumption and belated explanation and statement of accused about the possession of tainted currency notes.

5. Hazarilal Vs. State (Delhi Admninstration) AIR 1980 Supreme

Court 873 wherein the Lordships held that :

“If evidence of trap laying officer is trustworthy there is no need to seek any corroboration.

6. Kishanchand Mangal Vs. State of Rajasthan reported in AIR 1982

Supreme Court 1511 wherein the Lordships observed in para 2 as follows:

“Accompanying witnesses were standing in veranda and watching the happenings between complainant and accused inside the room. Their evidence was considered by the Court and upheld by Supreme Court.” “In this case an objection was raised by defence counsel that complainant did not give evidence as he was no more and both witnesses standing in veranda are petty clerks and it would be dangerous to place implicit reliance on their testimony to convict a 9C.C.1/2016/Prl. CBI Court/VSP government servant. This contention is outrightly rejected by the supreme court by observing in para 13 as follows:

“It is unfortunate that 35 years of independence and in this age of common man truth is neither the monopoly nor the preserve of the affluent. We have moved far away. We say no more. We are utterly disinclined to reject the testimony of two motvirs, accepted as only reliable.”

7. Madhukar Bhaskararao Joshi V. State of Maharashtra reported in 2001 (1) ALT (Crl.) 298 Supreme Court wherein Apex Court emphasized that :

“The very undisputed fact that the amount had reached the hands of appellant itself is sufficient corroboration for the testimony of P.W.1 that the amount was paid to appellant. The premise to be established on the facts for drawing the presumption is that there was for payment or acceptance of gratification. Once the said premise is established and inference to be drawn is that the said gratification was accepted as motive or reward for doing or forbearing to do any official act......We may point out that the defence did not even attempt to prove that amount received by the appellant was not accepted as a reward or motive for the official act done by him.

8. Ramesh and others Vs. State of Haryanan reported in AIR 2016

Supreme Court 5554 wherein regarding reasons for witnesses turning hostile the Lordships held as follows in paras 35 to 37:

“We find that it is becoming a common phenomena almost a regular feature that in criminal cases witnesses turn hostile. It may be fear of deposit against the accused/delinquent or political pressure or pressure of other family members or other such sociological factors. It is also possible that witnesses are corrupted with money considerations” 10C.C.1/2016/Prl. CBI Court/VSP

9. Judgment dated 19.12.2012 in Capital case (Appeal) No.3801 of 2001 of Allahabad High Court between Ramesh Pal Singh and others

Vs. State of U.P. In para 81 of this case Lordships laid down guidelines for evaluating the evidence of hostile witnesses.

14.Learned counsel for accused placed reliance upon the following decisions in support of his defence:

1. In N. Sunkanna Vs. State of A.P., reported in 2015 Cri.L.J.4927 the

Hon’ble High Court held as follows:

“It is settled Law that mere possession and recovery of currency notes from the accused without proof of demand will not bring home the offence under section 7, since demand of illegal gratification is sine qua non to constitute the said offence. The above also will be conclusive in so far as the offence under section 13(1)(d) is concerned as in the absence of any proof of demand for illegal gratification the use of corrupt or illegal means or abuse of position as a public servant to obtain any valuable thing or pecuniary advantage cannot be held to be established. It is only on proof of acceptance of illegal gratification that presumption under section 20 can be drawn.”

The same principle is also laid down in the following decisions:

In Subash Parbat Sonvane Vs. State of Gujarat reported in 2002

Cri.L.J.2787;

In B. Jayaraj Vs. State of A.P. reported in 2014 (2) ALD (Crl.) 73 (SC);

2. In K. Neelavathamma Vs. State reported in 2013 (1) ALD (Crl.) 641 (AP) Lordships observed as follows:

“Mere recovery of tainted amount by itself is not enough in absence of evidence to prove payment of bribe or to show that accused voluntarily accepted the money knowing it to be bribe. No presumption can be drawn under section 20 of P.C. Act.” 11C.C.1/2016/Prl. CBI Court/VSP

3.In CM Girish Babu Vs. CBI, Cochin, High Court of Kerala reported in 2009 (2) ALT (Crl) 65 (SC) the Lordships erudite:

“The burden of proof placed upon the accused peson against whom the presumption is made under section 20 of PC Act is not akin to that of burden placed on the prosecution to prove the case beyond a reasonable doubt.”

15.On the touch stone of these legal principles, we shall now test whether the prosecution has proved its case beyond reasonable doubt.

16.To establish the case of prosecution, P.Ws.1 to 29 were examined and

Exs.P.1 to P.57 were marked.

17.At the outset it must be stated that out of 29 witnesses, 18 witnesses including complainant/P.W.1 did not support the case of prosecution and turned hostile. Out of the remaining eleven witnesses P.Ws.3 to 6 are the

Railway officers who deposed about the duties of RPF and handing over of relevant documents to P.W.29/IO, P.W.21 is sanction authority, P.Ws.22 and 26 are Experts who gave opinion Exs.P.46 and P.55 and P.W.27 is the independent witness at the time of collecting specimen signatures and handwritings of accused by IO and P.W.29 is IO. Hence, prosecution is only left with the testimonies of P.W.2/accompanying witness and P.W.28/Trap

Laying officer who allegedly received Ex.P.5 complaint and laid trap respectively and totally relying upon them to establish the case of prosecution under secs.7 and 13(1)(d) r/w 13(2) of P.C. Act, 1988.

18.P.W.2/P.Venkateswara Rao, Assistant Manager in United India Insurance

Company Limited, T.P. Gudem, West Godavari District since 2015, who is an accompanying witness, deposed that on 15.2.2015 as per the directions of his Divisional Manager he met Trap Team at Food, Fats and Fertilizers Guest 12C.C.1/2016/Prl. CBI Court/VSP

House, T.P.Gudem at 4.30 p.m., and after he went, other witness L.W.3 also came and P.W.28/TLO introduced the complainant to him and other witness.

19.At page No.2 regarding the alleged demand and acceptance of M.O.1 tainted money, P.W.2 deposed that by 7.10 p.m., in two vehicles he along with the other witness and entire trap team went to Eluru Railway station in two vehicles and as per the directions of TLO he went along with P.W.1 to RPF station on first platform of Eluru Railway station and P.W.1 went into the corridor of RPF station and he stood at window and constable (PW7) who was in uniform stopped P.W.1 and went inside the room of accused and after taking permission he allowed P.W.1 into that room and thereafter P.W.1 talked to accused and taken amount from his shirt pocket and given the same with his right hand to the accused and accused took the same and kept it in a book on his table and thereafter P.W.1 came out and gave pre arranged signal to the Inspector and entire CBI team and witnesses including himself went into the room of accused.

20.He also deposed that P.W.28 introduced himself to accused and questioned accused who he was because he was in Civil dress and accused replied that he was RPF Inspector and when P.W.28 questioned him whether he demanded and accepted bribe from P.W.1 he was in shock and did not give immediate reply and after constables caught hold of his both hands accused replied that he did not take any bribe and P.W.1 himself voluntarily gave that amount and when Inspector questioned him where he kept the amount he replied that it was kept in book on his table.

21.Regarding recovery of M.O.1 P.W.2 further deposed that on the directions of P.W.28, L.W.3/other witness opened the book and found M.O.1 and when he and L.W.3 verified the currency note numbers they are tallied 13C.C.1/2016/Prl. CBI Court/VSP with the numbers mentioned in pre trap proceedings and chemical test conducted for right and left hand fingers of accused yielded positive results.

22.At this juncture, it is pertinent to note that even according to prosecution, P.W.2 alone witnessed the happenings in the office of accused between P.W.1 and accused by standing outside the southern window and after P.W.1 came out of the office and gave pre arranged signal only P.W.2, other witness and trap team went inside. Entire focus in the cross examination of P.W.2 is upon the existence or otherwise of southern window to the office of accused.

23.P.W.2 denied the suggestion that there was no window on southern side as shown in Ex.P.8 rough sketch and he along with P.W.1 did not come to the room of accused and no incident, as explained by him, happened inside the room of accused and his signatures were subsequently obtained in post trap and pre trap proceedings at midnight and because insurance company wherein he was working comes under the purview of CBI he deposed falsely due to fear of CBI.

24.Learned counsel for accused assiduously argued that the RPF station where accused was working in Eluru post is in platform No.1 and many trains will be running through the first platform and windows will be closed with glass doors and curtains to avoid sound pollution and further no third party will be allowed to stand at windows or doorways of RPF Inspector office and as such, it is not at all possible to watch or observe through any of the windows of the room of accused and P.W.7 admits the same.

25.Infact P.W.7 is also crucial witness since according to prosecution when

P.W.1/complainant came to RPF station to meet the accused, P.W.7 went into 14C.C.1/2016/Prl. CBI Court/VSP the room of accused and informed the same and only upon permission given by accused he allowed P.W.1 to enter into the chamber of accused and thereafter P.W.1 entered into the chamber of accused and came out five or ten minutes later and ten minutes after P.W.1 came out of the chamber of accused, CBI trap team went into the chamber

26.P.W.7/K. Sivasankara Rao, who worked as ASI at RPF post, Eluru during the relevant time under the accused and allegedly permitted P.W.1 to enter into the chamber of accused after informing the accused deposed as follows in this connection:

“It is true that all the windows of accused room in RPF station are closed with glass doors and there will be closed curtains for every window and doors in that room to avoid sound pollution because in platform No.1. It is true that we do not allow any third person to stand at windows of the room of RPF Inspector. It is true that even if any person stands at any window due to the closed curtains and glass doors no one can observe or hear anything in the room of Inspector.”

27.The aforementioned crucial admissions of P.W.7 who according to the prosecution was present in office during the relevant time clinchingly shows that even if there is southern window to RPF station on 1st platform, Eluru, since it will be closed with glass doors and curtains to avoid sound pollution and none can see anything which happens inside the room of accused through that window, the version of prosecution that P.W.2/accompanying witness had observed all the happenings till P.W.1 came out and gave prearranged signal through that window is utterly false.

28.Another important aspect is, P.W.7 deposed that out of the team of 8 members, four went inside and remaining four were guarding outside the room of accused. He never whispered about P.W.2 waiting at the window.

15C.C.1/2016/Prl. CBI Court/VSP

Though the case of prosecution is both accused and PW.2/accompanying witness came till the entrance door of the corridor of the accused office in

RPF station, Eluru post, in plat form No.1 and at that stage P.W.2 left P.W.1 and stood at southern window outside the office room of accused and P.W.7 stopped P.W.1 and after taking permission from accused he permitted P.W.1 to go in to the chamber of accused on the date of alleged trap, he was not even suggested when turned hostile that P.W.2 was standing at the window and that one can watch the happenings in the room of accused through that window. Nothing prevented P.W.2/accompanying witness from following P.W.1 into the chamber of accused instead of standing outside the window.

29.Curiously in chief examination P.W.7 deposed that cases booked under

Railways Act will be entered in C3C Register (Ex.P.23) but no case is registered against P.W.1 though he is an unauthorized hawker between

T.P.Gudem and Eluru railway stations. But in cross examination of accused, he admits that P.W.1 personally do not sell any food items in trains. Hence, the aforementioned testimony of P.W.7 falsifies the evidence of Pf.W.2 and version of prosecution.

30.Through P.W.3/M. Sambasiva Rao, who was predecessor of accused in

RPF post, Eluru, Ex.D.2 register relating to cases booked from 2012 to 2014 under sec.144(1) of Railways Act and amounts realized by accused and

Ex.D.3 letter addressed by S.R. Gandhi, the then Senior Divisional Security

Commissioner, Vijayawada to accused regarding number of cases booked under Railways Act which were sent to the Court were marked. At page 3 he deposed that in Ex.D.1 APRs., given by him to accused for the period 2011 to 2014, he mentioned that there are no complaints against the integrity of the 16C.C.1/2016/Prl. CBI Court/VSP accused and he did not receive any complaint from hawkers during his tenure against the accused.

31.The aforementioned testimony of P.W.3 clearly shows that APRs., of accused for the period 2011 to 2014 are clean and he maintains integrity and no complaints were received admittedly during the tenure of P.W.3.

32.Even otherwise P.W.2 never deposed that he heard any demand allegedly made by accused and acceptance of the amount towards the alleged demand of illegal gratification to allow P.W.1 to sell food items in trains. He simply deposed that P.W.1 talked to accused and took the amount from his shirt pocket and given the same to accused and accused kept the same in a book on his table. When he did not hear about any demand and acceptance of the amount towards illegal gratification, it cannot be presumed that after P.W.1 entered into the office room, accused demanded and P.W.1 gave the amount and came out from the office for giving pre arranged signal. Hence, the version of observing the happenings including alleged demand and acceptance and conversation between accused and

P.W.1, of P.W.2/accompanying witness cannot be believed. The said part of testimony of accompanying witness is not of any avail to the case of prosecution to prove the alleged demand and acceptance of illegal gratification. Hence, testimony of P.W.2 is wholly insufficient to come to any conclusion and draw presumption under sec.20 of P.C. Act. Further Ex.D.2 register proved that accused booked many cases under Railways Act against unauthorized hawkers for the period from 2012-2014.

33.Now prosecution is left with the sole testimony of P.W.28/TLO, pre trap and post trap proceedings and expert evidence.

17C.C.1/2016/Prl. CBI Court/VSP

34.Though according to P.W.22/Expert, CFSL, phenolphthalein was detected in M.Os.2 to 4 bottles as per Ex.P.47 report without any direct evidence in respect of alleged demand which is mandatory and acceptance of illegal gratification court cannot take into consideration of Ex.P.47 opinion.

Opinion evidence can never prevail over direct evidence. When according to the material on record, complainant and other important witnesses turned hostile and evidence of accompanying witness regarding the observance of happenings in the room of accused proved false for the reasons mentioned supra, it is not at all safe to rely upon the sole testimony of P.W.28/TLO and opinion of expert to convict the accused.

35.Turning to the testimony of P.W.28/TLO, at page no.3 he deposed that office of accused is situated on Platform No.1 of Eluru Railway station facing towards south and there is southern window through which activities and office room of accused are clearly visible from platform No.1 and when P.W.1 went into the office of accused, P.W.2 stood at the window of office of accused and the other witness M.Satyanarayana took position surrounding the office of accused and few minutes after entering into the office of accused P.W.1 came out and gave pre arranged signal that accused has demanded and accepted bribe amount from P.W.1 and P.W.2 also confirmed the same. When P.W.1 turned hostile and P.W.2 evidence cannot be taken into consideration for the aforementioned reasons, prosecution cannot still fall back upon the evidence of P.W.1 that he gave prearranged signal as if accused demanded and accepted bribe from P.W.1.

36.P.W.29/IO deposed that there is no record to say that trap team camped at Foods, Fats and Fertilizers guest house, T.P. Gudem during the 18C.C.1/2016/Prl. CBI Court/VSP relevant time and he did not collect call data from the mobile number of accused.

37.Curiously in the last sentence of page 3 and the first five lines in page 4, P.W.28 deposed as follows:

“on asking the accused about demand and acceptance of bribe of

Rs.6,000/- from P.W.1, he admitted that he did not take any bribe from the complainant. However, P.W.1 gave Rs.6,000/- to him, which he accepted and kept a daily dairy Ex.P.9 on his table and pointed out towards him. But P.W.1 stated that the accused demanded and accepted the bribe of Rs.6,000/- from him which was corroborated by

P.W.2. Then as per my instructions, Sri A. Krishna Rao prepared sodium carbonate solutions in two glass tamblers and the fingers of Sri Kota

Joji were subjected to phenopthelein test and both the solutions turned pink.”

38.The aforementioned own evidence of P.W.28 shows that accused never admitted acceptance of any bribe from the complainant and on the other and, on questioning by P.W.28 he stated that he did not take any bribe from

P.W.1 but P.W.1 gave Rs.6,000/- to him which was accepted and kept in Ex.P.9 daily dairy. P.W.1 explained in cross examination that he simply handed over

Rs.6,000/- to accused as per the instructions of one Nagaraju/hawker in

Railway station. The aforementioned testimony casts serious doubts regarding the demand for bribe and acceptance of the same by accused towards illegal gratification. There is absolutely no evidence about any demands prior to the date of trap. When proving demand itself which is mandatory requirement to establish any offence under secs.7 and 13(2) r/w 13(1)(d) of PC. Act, mere proof of acceptance of the amount is wholly insufficient. In the instant case, prosecution miserably failed to prove alleged demand for taking illegal gratification.

19C.C.1/2016/Prl. CBI Court/VSP

39.Without such proof, argument of learned Public Prosecutor that there is no reason to reject the evidence of P.Ws.2 and 28 on any ground and their evidence corroborates in all aspects and they have no enmity with accused to depose falsely against the accused and P.W.2 being officer in United India

Assurance Company is an independent witness and much value to be given for the said evidence, cannot be accepted for the aforementioned reasons.

40.Further, Learned Public Prosecutor argued that the testimony of P.W.1 in cross examination that one Nagaraju gave the amount of Rs.6,000/- and instructed him to handover the same to accused and after the incident though P.w.1 had seen Nagaraju he did not even ask whether he handed over the amount of RS.6,000/- as directed by him and P.W.1 met Nagaraju near auto stand of Eluru RPF which is hardly two or three minutes of walk from platform No.1 and inspite of the same without Nagaraju directly giving that amount to accused instructing P.W.1 to handover the amount is quite unnatural, unbelievable and contrary to sec.161 Cr.P.C., statement and as such the evidence of P.Ws.2 and 28 is to be accepted, do not hold any water in the light of the discussion in the foregoing paras.

41.Though according to the learned P.P., in Hazarilal Vs. State (Delhi

Administration) reported in AIR 1980 Supreme Court 873 it is laid down that trap laying officers evidence, if trust worthy, there is no need to seek any corroboration cannot be accepted as the facts in the said case are totally different from the factual situation in the instant case.

42.There is absolutely no positive, cogent and succinct evidence regarding alleged demand and acceptance of Rs.6,000/- towards bribe. Hence, presumption under sec.20 of P.C. Act, 1988 cannot be drawn.

20C.C.1/2016/Prl. CBI Court/VSP

43.The aforementioned discussion and evidence on record casts serious doubt upon the case of prosecution about alleged demand and acceptance of

Rs.6,000/- towards illegal gratification. Hence, prosecution miserably failed to prove the offence against the accused under sec.7 and 13(2) r/w 13(1)(d) of P.C. Act. Hence, accused he is liable to be acquitted for the said charge. I answer points 1 to 3 accordingly.

44.POINT NO.4:

The case of prosecution in respect of the charge under sec.13(a) of P.C.

Act is accused has been habitually receiving bribes from unauthorized vendors/hawkers in Railway platforms and running trains within the jurisdiction of Eluru Post and during Ex.P.7 proceedings, personal search of the accused was conducted and a slip containing his own handwritings by mentioning the names of vendors and amount collected from them was recovered and seized under Ex.P.52 and in the subsequent search conducted after trap in the presence of independent witnesses M.O.5 which is bunch of papers containing the names of vendors/hawkers and amount collected from them in different months were recovered along with the amount of

Rs.31,020/- which the accused could not satisfactorily account for and handwritings in Ex.P.55 are that of accused as per the opinion of P.W.26/

GEQD Expert.

45.In this connection, learned PP tried to impress upon the Court that out of 18 hostile witnesses, 16 witnesses were examined to prove the offence under sec.13(1)(a)of P.C. Act, 1988 and though all the witnesses turned hostile the handwritings in Ex.P.52 are that of the accused and the said fact is proved by P.W.26/GEQD through his opinion under Ex.P.55 and P.W.3 deposed that duty of the accused is to ensure the railway premises free from 21C.C.1/2016/Prl. CBI Court/VSP beggars, unauthorized hawkers, anti social elements and any other activity which is conducive for the movement of railways and control the crime but contrary to the same, as per P.W.20 accused used to visit stalls and direct them to follow rules in running canteens which is the duty of Food Inspectors and Sanitary Inspectors and the evidence on record clinchingly shows the habit of accused to maintain list of collection of bribes as under Ex.P.52 and receive bribes and burden shifts to the accused to explain about maintenance of Ex.P.52 list and visiting the stalls which is in his exclusive special knowledge.

46.Admittedly, 18 witnesses who were examined to prove habitual receiving of bribes by accused from the vendors/hawkers totally turned hostile. Prosecution is simply relying upon handwritings under Ex.P.52 allegedlyseized during the personal search of the accused in post trap proceedings and M.O.5 cash of Rs.31,020/- recovered along with Ex.P.52 containing the names of vendors/hawkers from the table drawer of accused and Ex.P.55 GEQD opinion of P.W.26 Expert opining that handwriting in

Ex.P.52 slip is that of accused. There are catena of decisions of various High

Courts and Apex Court to the effect that opinion evidence is a weak piece of evidence and it cannot override the direct evidence. When there is no evidence on record to show habitual receiving of bribe by accused as alleged and when all 18 witnesses who were examined to fortify the same turned hostile, conviction of accused cannot be based simply on Ex.P.26 opinion of

GEQD Expert without any corroboration. Further more, mere visiting of stalls by accused and instructing them to follow the rules, as stated by P.W.20, necessarily lead to the inference that he is in the habit of receiving bribes.

22C.C.1/2016/Prl. CBI Court/VSP

47.Learned counsel for the accused canvassed that there is no sanction for prosecution of accused under sec.13(1)(a) of P.C. Act, 1988 and on this ground itself accused is liable to be acquitted.

48.In reply to the same, Learned Public Prosecutor submitted that Ex.P.44 sanction letter covers even offence under sec.13(1)(a) of P.C. Act also and there is no necessity for obtaining separate sanction.

49.In the light of this, a careful scrutiny of Ex.P.44 sanction order shows that in last page 1st para of Ex.P.55 recovery of M.O.5 amount and habitual receiving of bribes is discussed. Offence under sec.13(1)(a) of P.C. Act is also well covered under Ex.P.44 sanction order. Hence, there is no force in the argument that there is no sanction for the offence under sec.13(1)(a) of P.C.

Act, 1988.

50.The learned counsel for accused vehemently argued that Ex.P.52 bunch of papers allegedly found in table drawer of accused is not mentioned in post trap proceedings and Ex.P.11 search list was separately prepared for the table drawer and even P.W.2/accompanying witness admits as to non mention of search proceedings of table drawer, seizure of cash and bunch of papers from the same in post trap proceedings.

51.It is further submitted unless the prosecution place any independent evidence to establish the alleged payment of amounts by hawkers, entries in

Ex.P.52 bunch of papers cannot be used as incriminating material and when prosecution failed to link up the alleged entries in Ex.P.52 by adducing any evidence the said amount of Rs.31,020/- cannot be proved to have been received by the accused towards bribe from the hawkers and more so, when the hawkers mentioned in Ex.P.52 did not support the prosecution when they 23C.C.1/2016/Prl. CBI Court/VSP were confronted with Ex.P.52 entries no weight should be given to the evidence of P.Ws.26 and 27 Experts.

49.As submitted by the learned counsel for accused, admittedly there is no did not whisper about Ex.P.11 search proceedings of office table drawer of accused and seizure of cash and bunch of papers from the drawer in post trap proceedings and there is absolutely no evidence on record to link up the alleged entries in Ex.P.52 bunch of papers with accused by adducing independent evidence and on the other hand, when these entries were confronted to the hawkers, they did not admit the same.

50.Under the aforementioned circumstances since there is absolutely no evidence in respect of the charge under sec.13(1)(a) prosecution miserably failed to prove offence against the accused under sec.13(1)(a) of P.C. Act.

Hence, accused is liable to be acquitted under this charge also. I answer the point accordingly.

51.In the result, Accused is found not guilty for the offence punishable under secs.7, 13(1)(d) r/w 13(2) and 13(1)(a) r/w 13(2) of Prevention of

Corruption Act, 1988 and he is acquitted under sec.248(1) Cr.P.C. The Bail bonds of the Accused, if any, shall stand cancelled. M.O.1 cash of Rs.5,000/- shall be returned to P.W.1/Chittekela

Gopi/complainant after expiry of appeal time. M.Os.2 to 4 shall be destroyed after expiry of appeal time. M.O.5 cash of Rs.31,020/- shall be confiscated to

State after expiry of appeal time.

Accused shall execute a bond of Rs.10,000/- (Rupees ten thousand only) undertaking to appear before the Hon’ble High Court in terms of

Sec.437-A Cr.P.C.

24C.C.1/2016/Prl. CBI Court/VSP

Typed to my dictation, corrected and pronounced by me in open Court on this the day 10th day of April, 2018.

Sd/- A. Gayathri Devi,

PRL. SPL. JUDGE FOR C.B.I. CASES,

VISAKHAPATNAM.

IDENCE

AAPPENDIX OF EVIDNEF

APPENDIX OF EVIDENCE

LIST OF WITNESSES EXAMINED ON BEHALF OF PROSECUTION.

P.W.1/16.06.17: Chittikela Gopi P.W.2/16.06.17: P. Venkateswara Rao P.W.3/19.06.17: M. Sambasiva Rao P.W.4/19.06.17: Y. Pulla Rao P.W.5/20.06.17: Ch. Suresh P.W.6/20.06.17: G.V. Ratneswar Kumar P.W.7/21.06.17: K.S.S. Varaprasad P.W.8/21.06.17: Shaik Subhani P.W.9/07.07.17: Bandi Appa Rao P.W.10/10.07.17: A. Govinda Rao P.W.11/10.07.17: E. Satyanarayana P.W.12/10.07.17: T. Butchi Babu P.W.13/11.07.17: M. Veera Krishna P.W.14/11.07.17: Y. Narasimha Rao P.W.15/12.07.17: G. Naresh P.W.16/12.07.17: B. Purna Chandra Rao P.W.17/06.11.17: A. Vamsi Krishna P.W.18/06.11.17: G. Appa Rao P.W.19/07.11.17: P. Gopala Krishna P.W.20/07.11.18: Reddy Appalanaidu P.W.21/08.11.17: Sarat Chandra Parchi P.W.22/08.11.17: P. Sudhakar P.W.23/08.11.17: A. Vidyarthi P.W.24/21.11.17: V.N.G.Chakradhara RAo P.W.25/21.11.17: A. Tirumala Rao P.W.26/08.12.17: P. Venugopal Rao P.W.27/03.01.18: K. Kurma Rao (Addl. witness) P.W.28/01.02.18: D. Vasukrishna P.W.29/12.02.18: Jeevan Bhagat

LIST OF DOCUMENTS MARKED ON BEHALF OF PROSECUTION.

Ex.P.1: Signature of P.W.1 on L.D.No.1 report Ex.P.2: Sec.161 Cr.P.C., statement of P.W.1 Ex.P.3: Six numbers of signatures on L.D.No.3 Ex.P.4: Ten numbers of signatures on L.D.No.4 Ex.P.5: Complaint 25C.C.1/2016/Prl. CBI Court/VSP

Ex.P.6: Pre Trap proceedings Ex.P.7: Post Trap Proceedings Ex.P.8: Rough Sketch Ex.P.9: Daily dairy register of RPF, South Central Railway Ex.P.10: Photo copy of list Ex.P.11: Search list conducted at office table of accused Ex.P.12: Search list conducted at the house of accused Ex.P.13: Receipt memo dt.20.3.2015 Ex.P.14: File relating to correspondence of train side vending (contains 43 sheets). Ex.P.15 : Catering stalls in Eluru station. Ex.P.16 : List of catering stalls pertains to Tadepalligudem. Ex.P.17 : Catering stalls pertaining to Nidadavolu station. Ex.P.18 : List of catering stalls pertaining to Rajahmundry station. Ex.P.19: Letter dt.20.3.2015 Ex.P.20: Extract of ID cards register relating to train side vending Ex.P.21: Authorityh of Chief Commercial Manager to issue passes for train side vending and summary of passes issued from 16.10.14 to 25.1.15 Ex.P.22: Receipt memo dt.19.3.15 Ex.P.23: C3C Register (Railway Act Register) Ex.P.24: Relevant Portion in sec.161 Cr.P.C., statement of P.W.7 Ex.P.25: Relevant portion in sec.161 Cr.P.C., statement of P.W.8 Ex.P.26: Relevant portion in sec.161 Cr.P.C., statement of P.W.8 Ex.P.27: Relevant portion in sec.161 Cr.P.C., statement of P.W.8 Ex.P.28: Relevant portion in sec.161 Cr.P.C., statement of P.W.9 Ex.P.29: Relevant portion in sec.161 Cr.P.C., statement of P.W.10 in II and III paras Ex.P.30: Relevant portion in sec.161 Cr.P.C., statement of P.W.11 Ex.P.31: Relevant portion in sec.161 Cr.P.C., statement of P.W.12 Ex.P.32: Relevant portion in sec.161 Cr.P.C., statement of P.W.13 Ex.P.33: Relevant portion in sec.161 Cr.P.C., statement of P.W.13 Ex.P.34: Relevant portion in sec.161 Cr.P.C., statement of P.W.14 Ex.P.35: Relevant portion in sec.161 Cr.P.C., statement of P.W.14 Ex.P.36: Relevant portion in sec.161 Cr.P.C., statement of P.W.15 (II Para) Ex.P.37: Relevant portion in sec.161 Cr.P.C., statement of P.W.15 (III Para) Ex.P.38: Relevant portion in sec.161 Cr.P.C., statement of P.W.16 (II para) Ex.P.39: Relevant portion in sec.161 Cr.P.C., statement of P.W.16 (III Para) Ex.P.40: Relevant portion in sec.161 Cr.P.C., statement of P.W.17 (Entire report) Ex.P.41: Relevant portion in sec.161 Cr.P.C., statement of P.W.18 (II Para) Ex.P.42: Relevant portion in sec.161 Cr.P.C., statement of P.W.19 (II & III paras) Ex.P.43: Relevant portion in sec.161 Cr.P.C., statement of P.W.20 (Last para of statement) Ex.P.44: Sanction order dt.12.5.05 along with schedule of powers of RPF Rules Ex.P.45: Forwarding letter dt.12.5.05 Ex.P.46: Forwarding letter dt.19.3.15 containing seals Ex.P.47: Examination report dt.9.3.15 Ex.P.48: Relevant portion in 161 Cr.P.C. statement of P.W.23 (II, III paras) Ex.P.49: Relevant portion in sec.161 Cr.P.C., statement of P.W.24 Ex.P.50: Relevant portion in sec.161 Cr.P.C., statement of P.W.25 Ex.P.51: Questioned writings in ten sheets Ex.P.52: Small slip containing questioned writings Ex.P.53: Specimen handwritings in 25 sheets Ex.P.54: Forwarding letter of opinion along with office seal Ex.P.55: Opinion (five sheets) 26C.C.1/2016/Prl. CBI Court/VSP

Ex.P.56: Original FIR in R.C.1(A)/15 of CBI, VSP. Ex.P.57: Hand book on catering services of South Central Railway

LIST OF WITNESSES EXAMINED ON BEHALF OF DEFENCE.

NIL

LIST OF DOCUMENTS MARKED ON BEHALF OF DEFENCE.

Ex.D.1 : Annual performance Appraisal reports of accused for the years 2009 to 2014 Ex.D.2 : Information furnished under RTI Act by Sr.D.S.C. RPF/VJW dt.13.1.2016 Ex.D.3: Information furnished under RTI Act by Sr.D.S.C. RPF/VJW dt.6.6.17 (marked in cross examination of P.W.3)

MATERIAL OBJECTS MARKED ON BEHALF OF PROSECUTION

M.O.1: Tainted amount of Rs.5,000/- M.O.2: Right hand finger wash with one sealed bottle M.O.3: Left hand finger wash with one sealed bottle M.O.4: Sealed bottle containing cotton swab wash M.O.5: Cash of Rs.31,020/-

Sd/- A. Gayathri Devi,

PRL. SPL. JUDGE FOR C.B.I. CASES,

VISAKHAPATNAM.

Copy submitted to

The Hon’ble Registrar (Judicial), High Court of Judicature at Hyderabad for the State of Telangana and the State of Andhra Pradesh

Copies to:

1. The Superintendent of Police, C.B.I., Visakhapatnam.

2. The Central Forensic Science Laboratory, Ramanthapur, Hyderabad-500 013.

4. The Chief Security Commissioner, Railway Protection Force, South Central Railway, Rail Nilayam, Secunderabad-500 071 //True Copy //

Prl. Spl. Judge for C.B.I. Cases, Visakhapatnam.

27C.C.1/2016/Prl. CBI Court/VSP