Kerala High Court

P.S.Mony vs Superintendent Of Police,Cbi on 20 March, 2025

                                               2025:KER:24075



           IN THE HIGH COURT OF KERALA AT ERNAKULAM

                            PRESENT

          THE HONOURABLE MR.JUSTICE P.G. AJITHKUMAR

  THURSDAY, THE 20TH DAY OF MARCH 2025 / 29TH PHALGUNA, 1946

                     CRL.A NO.1023 OF 2008

AGAINST THE JUDGMENT DATED 16.05.2008 IN CC NO.10 OF 2003 OF

THE COURT OF THE SPECIAL JUDGE (SPE/CBI)-I, ERNAKULAM


APPELLANT/2ND ACCUSED:

          HUSSAIN MANIKFAN
          AGED 56 YEARS
          S/O.HASSAN MANIKFAN, MANAGER, M/S.MAREENA
          ENTERPRISES, MINICOY (PROPRIETOR, M/S.SAZY
          CORPORATION, MINICOY ISLAND,
          UNION TERRITORY OF LAKSHADWEEP.


RESPONDENT/COMPLAINANT:

          THE SUPERINTENDENT OF POLICE,
          CBI, KOCHI THROUGH THE STANDING COUNSEL FOR
          CBI, HIGH COURT OF KERALA, ERNAKULAM.


          BY ADVS.
          SRI.P.CHANDRASEKHARA PILLAI, C.B.I.
          SREELAL WARRIAR


      THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON
28.02.2025, ALONG WITH CRL.A.1091/2008, THE COURT ON 20.03.2025
DELIVERED THE FOLLOWING:
                                                     2025:KER:24075
                                         2
Crl.Appeal Nos.1023 and 1091 of 2008




              IN THE HIGH COURT OF KERALA AT ERNAKULAM

                                       PRESENT

              THE HONOURABLE MR.JUSTICE P.G. AJITHKUMAR

  THURSDAY, THE 20TH DAY OF MARCH 2025 / 29TH PHALGUNA, 1946

                           CRL.A NO. 1091 OF 2008

      AGAINST THE CONVICTION AND SENTENCE IN C.C. NO.10 OF 2003
ON THE FILE OF SPECIAL JUDGE (SPE/CBI)-I, ERNAKULAM
APPELLANT/ACCUSED NO.1:

             P.S.MONY
             HEAD MASTER,GOVT. HIGH SCHOOL/SR.SEC SCHOOL,
             MINICOY, LAKSHADWEEP


             BY ADVS.
             A.MOHAMMED
             SRI.GEORGE MATHEWS
             S.RAJEEV S
             V.VINAY(K/355/2009)
             M.S.ANEER(K/644/2013)
             SARATH K.P.(K/001467/2021)
             PRERITH PHILIP JOSEPH(K/000736/2015)


RESPONDENT/COMPLAINANT:

             SUPERINTENDENT OF POLICE,
             CBI:SPE:KOCHIN REPRESENTED BY THE PUBLIC
             PROSECUTOR OF CBI, HIGH COURT OF KERALA,,
             ERNAKULAM


             BY ADVS.
             SRI.P.CHANDRASEKHARA PILLAI, C.B.I.
             SREELAL WARRIAR

      THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON
28.02.2025, ALONG WITH CRL.A.1023/2008, THE COURT ON 20.03.2025
DELIVERED THE FOLLOWING:
                                                   2025:KER:24075
                                       3
Crl.Appeal Nos.1023 and 1091 of 2008


                     P.G. AJITHKUMAR, J.
    -----------------------------------------------------------
           Crl.Appeal Nos. 1023 and 1091 of 2008
    -----------------------------------------------------------
           Dated this the 20th day of March, 2025

                                 JUDGMENT

C.C.No. 10 of 2003 was tried and disposed of by the

Special Judge (SPE/CBI)-I, Ernakulam as per the judgment

dated 16.05.2008. The offences alleged were punishable under

Section 120B read with Section 420 of the Indian Penal Code,

1860 (IPC) and Section 13(1)(d) read with Section 13(2) of the

Prevention of Corruption Act, 1988 (PC Act). Both the accused

were found guilty and convicted of those offences. The 1st

accused filed Crl.Appeal No.1091 of 2008 and the 2nd accused

filed Crl.Appeal No.1023 of 2008.

2. The 1st accused was the Headmaster of Government

Higher Secondary School, Minicoy during the period from 1990

to 1996. The 2nd accused created two concerns, namely,

M/s.Mareena Enterprises, Minicoy and M/s.Sazy Corporation,

Minicoy claiming to be suppliers of various articles and

undertaking various works. The allegation of the prosecution is 2025:KER:24075

Crl.Appeal Nos.1023 and 1091 of 2008

that they had hatched a conspiracy to misappropriate money

by cheating the Administration of the Union Territory of

Lakshadweep and in pursuance of that conspiracy, various

amounts were withdrawn from the treasury by the 1st accused

on the strength of the proceedings drawn by him

unauthorisedly. Although the amount withdrawn from the

treasury were paid to the 2nd accused, the articles were not

supplied and the works were not done. By issuing the

proceedings unauthorisedly and drawing the amount from the

treasury without effecting the purchase and undertaking the

work corresponding to the proceedings, the accused had

misappropriated various amounts. Thus, the accused allegedly

had committed the aforementioned offences.

3. Nine instances of purchases/ construction were

involved in this case. The details of such

purchases/construction and corresponding amounts allegedly

misappropriated are given below:

Sl.No. Description of the good purchased/ service Amount availed involved 1 Purchase of stage lighting equipments Rs.9,900/-

2025:KER:24075

Crl.Appeal Nos.1023 and 1091 of 2008

2 Purchase of audio visual equipments and public Rs.52,350/-

addressing system 3 Purchase of furniture Rs.28,000/-

4 Purchase of vacuum cleaner, fabre foam, Rs.11,900/-

cushions, table top glass and plastic sign boards 5 Purchase of materials for science fair Rs.1,976/- 6 Purchase of photocopier machine, photocopier Rs.1,86,000/-

paper and molded chairs 7 Purchase of photography and screen-printing Rs.55,675/-

materials 8 Construction of platform Rs.13,810/-

9 Purchase of steel furniture Rs.52,500/-

4. The trial court, after framing charge and on the

appellants' denying the charge, held trial. PWs.1 to 23 were

examined and Exts.P1 to P103(a) were marked. After closing

the prosecution evidence, the appellants were questioned

under Section 313(1)(b) of the Code. Both of them denied

having committed the offences. The 1st accused took the stand

that in order to arrange infrastructure necessitated on account

of the affiliation of the School to the Central Board of Secondary

Education, immediate purchases and works were to be done.

That, as directed by the superiors, he had to take steps for the

purchases and works for which there was implied sanction from

the Administrator of Lakshadweep. The intended purchases 2025:KER:24075

Crl.Appeal Nos.1023 and 1091 of 2008

were effected and works were done and the amounts drawn

from the treasury were properly utilised. He thus contended

that he did not commit any offence. The 2nd accused took the

stand that the articles were supplied and works were

undertaken corresponding to the bills and there was absolutely

no misappropriation or element of cheating in the transactions.

On the side of the accused, Exts.D1 to D17 were marked. The

Special Court, after considering the evidence on record, found

both the accused guilty. The findings leading to their conviction

are assailed in these appeals on factual and legal grounds.

5. Heard the learned counsel for the respective

Appellants and the learned Standing Counsel for the CBI.

6. Nine instances of purchase/work are the subject

matter of these appeals. The allegations are two-fold. The 1st

accused in the capacity of the Headmaster, Govt. Higher

Secondary School, Minicoy was not competent to meet the

expenses of the said purchases/work. The second is that the

amounts drawn from the treasury were misappropriated. The 2025:KER:24075

Crl.Appeal Nos.1023 and 1091 of 2008

2nd accused, who acted as a supplier/contractor of the said

purchases/work, but he was only a proxy of the 1st accused.

7. The fact that the 2nd accused was the contractor for

the purchases/work, the 1st accused, on the strength of various

proceedings issued by he himself, had withdrawn the respective

amounts from the Sub Treasury, Minicoy and that the amounts

were paid to the 2nd accused are not disputed. The said facts

are proved by the prosecution by adducing sufficient evidence

as well.

8. Exts.P4, P8, P12, P17, P24, P28, P31, P35 and P38

are the proceedings issued by the 1st accused in respect of the

purchases and work. The claim of the 1st accused is that he had

implied consent from the authorities to draw up the said

proceedings, and he was empowered owing to the urgency for

carrying out the work and effecting purchases in the wake of

obtaining affiliation to the school from the CBSE. In order for

easy understanding and reference the details of the

purchases/work and details of relevant documents are

tabulated below:

2025:KER:24075

Crl.Appeal Nos.1023 and 1091 of 2008

Sl.No. Description of the good purchased/ Amount Proceedings Receipt service availed involved (Exhibit) (Exhibit) 1 Purchase of stage lighting equipments Rs.9,900/- P24 P45 2 Purchase of audio visual equipments Rs.52,350/- P28 P49 and public addressing system 3 Purchase of furniture Rs.28,000/- P4 P6 4 Purchase of vacuum cleaner, fabre Rs.11,900/- P8 P60 foam, cushions, table top glass and plastic sign boards 5 Purchase of materials for science fair Rs.1,976/- P31 Not produced 6 Purchase of photocopier machine, Rs.1,86,000/- P12 Not photocopier paper and molded chairs produced 7 Purchase of photography and screen- Rs.55,675/- P17 P73 printing materials (series) 8 Construction of platform Rs.13,810/- P35 P77 9 Purchase of steel furniture Rs.52,500/- P38 P80

9. The Director of Education (PW14), the successor

Headmaster of the Govt. Higher Secondary School, Minicoy

(PW17) and the Senior Administrator (Education) (PW15)

deposed before the court about the financial powers of the 1st

accused. Their consistent version is that as the Headmaster of

the Govt. Higher Secondary School, Minicoy, the 1st accused

could have incurred expenses upto Rs.1,000/- only for a single

instance of non-recurring expenditure. The case of the 1st

accused is that he had implied consent from the higher

authorities to spend more amount to meet the urgent needs.

But, no evidence in support of that claim is adduced by the 1st 2025:KER:24075

Crl.Appeal Nos.1023 and 1091 of 2008

accused. From the said evidence and circumstances, there can

have no doubt that the 1st accused exceeded his authority while

issuing Exts.P4, P8, P12, P17, P24, P28, P31, P35 and P38

proceedings. Therefore, while issuing the said proceedings, the

1st accused violated the departmental norms and regulations.

10. The prosecution alleges that the 2nd accused was not

a contractor or a supplier. In order to prove that fact, the

prosecution has examined PW1, who is the brother of the 2nd

accused. He deposed before the court, resiling from the

statement he had given to the investigating officer. He stated

that the 2nd accused was conducting Mareena Enterprises which

he had been conducting earlier. Although he was cross-

examined with permission from the court, no evidence in

support of prosecution has come out from him. Therefore,

absolutely no evidence has come from this witness to

substantiate the allegation that the 2nd accused did not have

such a business. No other evidence is available in that regard

as well.

2025:KER:24075

Crl.Appeal Nos.1023 and 1091 of 2008

11. Exts.P6, P45, P49, P60, P73 series, P77 and P80 are

the receipts issued by the 2nd accused in respect of the payment

concerning the works/supply of goods in question. Receipts

concerning two purchases are not seen produced. The

prosecution has no case that payment of all the amounts

involved in this case were not effected. Therefore, the position

is that entire amounts withdrawn by the 1st accused

corresponding to Exts.P4, P8, P12, P17, P24, P28, P31, P35 and

P38 proceedings were paid to the 2nd accused. The question

then is whether he undertook the work and supplied the articles

in terms of the said proceedings and the corresponding

invoices.

12. The Special Court considered the evidence on record

in detail with reference to the aforementioned question. The

learned Special Judge took the stand that construction of the

platform which is one among the questioned items was to be

carried out by the PWD and therefore the 1st accused could not

get it done through the 2nd accused. The fact that such a work

was carried out is not very much in dispute. But the accused 2025:KER:24075

Crl.Appeal Nos.1023 and 1091 of 2008

were implicated to the offence of criminal misconduct and

cheating for the reason that the work was done through an

unauthorised person, the 2nd accused and the amount of

Rs.13,810/- was withdrawn by the 1st accused for making

payment for the work by exceeding his power.

13. When the dishonest intention to misappropriate is

the fact in issue, the question is whether the money was spent,

and the corresponding work was done. Whether or not the work

was done by a duly empowered person, as though is a relevant

question concerning dereliction of duty and abuse of the official

position, that by itself would not amount to a criminal offence.

Only if it is proved that the money so withdrawn was

misappropriated or by undertaking such a work the accused

had gained some pecuniary advantage, there can be a

prosecution for the offence under Section 13(1)(d) of the PC

Act or under Section 420 of the IPC.

14. Coming to the other instances of the purchases in

question, improper accounting of the articles purchased was

the fact based on to convict the accused. The learned Special 2025:KER:24075

Crl.Appeal Nos.1023 and 1091 of 2008

Judge considered the evidence of PW16, the Accountant in the

Govt. Higher Secondary School during the relevant period and

the entries in the stock registers in order to arrive at a

conclusion that the accounting of the articles purchased was

not proper and therefore there was conspiracy,

misappropriation and cheating. I fail to understand how an

improper accounting or incorrect entry of the articles in the

stock register would enable an inference of misappropriation of

the money used to purchase the articles. If, as a matter of fact,

the articles were purchased and such articles are added to the

stock, it cannot be found that there occurred criminal

misappropriation.

15. The learned counsel for the respective appellants

would submit that PW23, the investigating officer did not

venture to inspect the entire premises of the school so as to

ascertain whether the articles purchased in terms of the

aforementioned proceedings and invoices were available in the

school. His version before the court is that he had inspected a

few rooms. It is to be noted that the all the stock registers 2025:KER:24075

Crl.Appeal Nos.1023 and 1091 of 2008

available in the school were not verified, seized or produced

before the court. It was following an application by the

accused, the stock registers were summoned. Various pages of

the stock registers were produced by the prosecution and

admitted in evidence. Certified copies of a few pages of the

stock registers which were produced as Exts.P27 and P28 in a

connected case, C.C.No.13 of 2013 were admitted in evidence

as Exts.D1 and D17 at the instance of the accused. From the

said stock registers, it can certainly be said that most of the

articles purchased at the instance of the 1st accused were

entered in the stock register.

16. PW16 stated that the procedure for entering the

newly purchased articles in the respective stock registers was

not followed. Although entries were being made by the teachers

concerned, in these cases of purchase, often, the 1st accused

himself made or verified the entries. PW16 further deposed that

he could not vouchsafe the correctness of the entries in the

stock registers. It is true that in the light of the said evidence,

there created some sort of suspicion about the proper entries 2025:KER:24075

Crl.Appeal Nos.1023 and 1091 of 2008

in the stock registers concerning the purchased articles.

Findings of the learned Special Judge also is the same. The

learned Special Judge further observed "the question arises for

consideration whether the accused has purchased the goods is

immaterial since he has purchased it without any authority and

misusing his position as a public officer." Holding so, the Special

Court found both the accused guilty.

17. The Apex Court in Abdulla Mohammed Pagarkar

v. State (Union Territory of Goa, Daman and Diu) [(1980)

3 SCC 110] held that the onus of proving existence of every

ingredients of the charge always rests on the prosecution and

never shifts. It is incumbent upon the prosecution to prove the

charge, beyond a reasonable doubt. In the case of an offence

punishable under Section 13(1)(d) read with 13(2) of the Act,

no presumption under Section 20 of the PC Act can be drawn

as well. See Union of India through Inspector, CBI v.

Purnandu Biswas [(2005) 12 SCC 576]. The learned

Special Judge however proceeded as if the proof regarding

irregularity in drawing up the proceedings for encashing the 2025:KER:24075

Crl.Appeal Nos.1023 and 1091 of 2008

invoice amount and the impropriety in maintaining the stock

In short, on the basis of some inferences alone, the conviction

was entered into. It is trite that a presumption or inference

however strong it be cannot take the place of evidence.

18. From the discussion made hereinbefore, it is obvious

that utilising the amounts withdrawn by the 1st accused based

on Exts.P4, P8, P12, P17, P24, P28, P31, P35 and P38

proceedings, the intended articles were purchased. In that

process there occurred procedural irregularity and violation of

departmental norms. There occurred impropriety in entering

the purchased articles in the stock registers also. Beyond

that, there has not been any evidence to prove that the

accused committed misappropriation of funds.

19. A similar situation was considered by the Apex Court

in C.Chenga Reddy v. State of A.P. [(1996) 10 SCC 193].

In that case the contract was awarded in violation of the

regulations. It was considered whether in the absence of

circumstances sufficient to prove the guilt of criminal 2025:KER:24075

Crl.Appeal Nos.1023 and 1091 of 2008

misconduct could there be a conviction. The following

observations are relevant:

"22. On a careful consideration of the material on the record, we are of the opinion that though the prosecution has established that the appellants have committed not only codal violations but also irregularities by ignoring various circulars and departmental orders issued from time to time in the matter of allotment of work of jungle clearance on nomination basis and have committed departmental lapse yet, none of the circumstances relied upon by the prosecution are of any conclusive nature and all the circumstances put together do not lead to the irresistible conclusion that the said circumstances are compatible only with the hypothesis of the guilt of the appellants and wholly incompatible with their innocence. In Abdulla Mohammed Pagarkar v. State (Union Territory of Goa, Daman and Diu), [1980] 3 SCC 110], under somewhat similar circumstances this Court opined that mere disregard of relevant provisions of the Financial Code as well as ordinary norms of procedural behaviour of government officials and contractors, without conclusively establishing, beyond a reasonable doubt, the guilt of the concerned officials and contractors, may give rise to a strong suspicion but that cannot be held to establish the guilt of the accused. The established circumstances in this case also do not establish criminality of the appellants beyond the realm of suspicion and, in our 2025:KER:24075

Crl.Appeal Nos.1023 and 1091 of 2008

opinion, the approach of the trial court and the High Court to the requirements of proof in relation to a criminal charge was not proper. xx xx"

20. The said view was reiterated by the Apex Court in

C.K.Jaffer Sharief v. State (through CBI) [(2013) 1 SCC

205]. Unless the prosecution is able to establish that the

accused has obtained some material thing or pecuniary

advantage on account of the misconduct, misusing his official

position, a conviction for the offence under Section 13(1)(d) of

the PC Act is not possible. The same principle is applicable to

the offence under Section 420 of the IPC as well. As held by the

Apex Court in Abdulla Mohammed Pagarkar v. State

(Union Territory of Goa, Daman and Diu) [(1980) 3 SCC

110], a suspicion, however strong is not enough to convict an

accused. It was held:

"24. Learned counsel for the State sought to buttress the evidence which we have just above discussed with the findings recorded by the learned Special Judge and detailed as items (a) to (e) in paragraph 9 and items (i) and (iii) in paragraph 10 of this judgment. Those findings were affirmed by the learned Judicial Commissioner and we are clearly of the opinion, for reasons which need not be 2025:KER:24075

Crl.Appeal Nos.1023 and 1091 of 2008

restated here, that they were correctly arrived at. But those findings merely make out that the appellants proceeded to execute the work in flagrant disregard of the relevant Rules of the G.F.R. and even of ordinary norms of procedural behaviour of Government officials and contractors in the matter of execution of works undertaken by the Government. Such disregard however has not been shown to us to amount to any of the offences of which the appellants have been convicted. The said findings no doubt make the suspicion to which we have above adverted still stronger but that is where the matter rests and it cannot be said that any of the ingredients of the charge have been made out."

21. In view of the law laid down in the aforesaid

decisions, violation of norms by the 1st accused in the matter

of drawing Exts.P4, P8, P12, P17, P24, P28, P31, P35 and P38

proceedings by itself would not amount to an offence under

Section 13(1)(d) of the PC Act. No evidence to establish that

the 1st accused did so with dishonest intention of obtaining any

material thing or pecuniary advantage for himself or for any

other person is adduced either. In the circumstances,

conviction of the accused by the Special Court for the offences

not only under Section 13(1)(d) read with Section 13(2) of the 2025:KER:24075

Crl.Appeal Nos.1023 and 1091 of 2008

PC Act, but also for the offences under Section 120B read with