Telangana High Court
C. Bala Malleshwar Rao, vs The State Of Ap Rep By Its Spl. Pp Hyd.,For ... on 16 April, 2024
1
HIGH COURT FOR THE STATE OF TELANGANA
AT HYDERABAD
*****
Criminal Appeal No.729 OF 2007
Between:
C.Bala Malleshwar Rao ... Appellant
And
The State of Telangana
ACB, City Range, rep. by
Special Public Prosecutor ..Respondent/Complainant
Criminal Appeal No.737 OF 2007
Between:
G.Chandrasekhar ... Appellant
And
The State of Telangana
ACB, City Range, rep. by
Special Public Prosecutor ..Respondent/Complainant
Criminal Appeal No.789 OF 2007
Between:
Syed Anwar Hussain ... Appellant
And
The State of Telangana
ACB, City Range, rep. by
Special Public Prosecutor ..Respondent/Complainant
2
Criminal Appeal No.793 OF 2007
Between:
G.Damodar ... Appellant
And
The State of Telangana
ACB, City Range, rep. by
Special Public Prosecutor ..Respondent/Complainant
Criminal Appeal No.828 OF 2007
Between:
K.L.Rama Rao ... Appellant
And
The State of Telangana
ACB, City Range, rep. by
Special Public Prosecutor ..Respondent/Complainant
Criminal Appeal No.850 OF 2007
Between:
V.Satyanarayana and another ... Appellants
And
The State of Telangana
ACB, City Range, rep. by
Special Public Prosecutor ..Respondent/Complainant
DATE OF JUDGMENT PRONOUNCED :16.04.2024
Submitted for approval.
3
THE HON'BLE SRI JUSTICE K.SURENDER
1 Whether Reporters of Local
newspapers may be allowed to see the Yes/No
Judgments?
2 Whether the copies of judgment may
be marked to Law Reporters/Journals Yes/No
3 Whether Their Ladyship/Lordship
Wish to see their fair copy of the Yes/No
Judgment?
__________________
K.SURENDER, J
4
* THE HON'BLE SRI JUSTICE K. SURENDER
+ CRL.A. No.729 of 2007
% Dated 16.04.2024
# C.Bala Malleshwar Rao ... Appellant
And
$ The State of Telangana
ACB, City Range, rep. by
Special Public Prosecutor ..Respondent/Complainant
Criminal Appeal No.737 OF 2007
Between:
# G.Chandrasekhar ... Appellant
And
$ The State of Telangana
ACB, City Range, rep. by
Special Public Prosecutor ..Respondent/Complainant
Criminal Appeal No.789 OF 2007
Between:
# Syed Anwar Hussain ... Appellant
And
$ The State of Telangana
ACB, City Range, rep. by
Special Public Prosecutor ..Respondent/Complainant
Criminal Appeal No.793 OF 2007
Between:
# G.Damodar ... Appellant
And
$ The State of Telangana
ACB, City Range, rep. by
Special Public Prosecutor ..Respondent/Complainant
5
Criminal Appeal No.828 OF 2007
Between:
# K.L.Rama Rao ... Appellant
And
$ The State of Telangana
ACB, City Range, rep. by
Special Public Prosecutor ..Respondent/Complainant
Criminal Appeal No.850 OF 2007
Between:
# V.Satyanarayana and another ... Appellants
And
$ The State of Telangana
ACB, City Range, rep. by
Special Public Prosecutor ..Respondent/Complainant
! Counsel for the Appellants: Sri A.Dattanand
Sri S.Someshwar Rao
Sri L.N.Bhadri Raju
Sri C.Sharan Reddy
^ Counsel for the Respondents: Sri Sridhar Chikyala,
Special Public Prosecutor for ACB
>HEAD NOTE:
? Cases referred
1
2023 SCC OnLine SC 1261
2
AIR 2004 SC 892
3
AIR 1985 SC 1224
4
AIR 1998 SC 244
5
(2003) 1 SCC 259
6
HON'BLE SRI JUSTICE K.SURENDER
CRIMINAL APPEAL Nos.729, 737, 789, 793, 828 and 850
OF 2007
COMMON JUDGMENT:
1. These Criminal Appeals are filed aggrieved by the
conviction recorded by the Principal Special Judge for SPE &
ACB Cases, City Civil Court at Hyderabad vide judgment in
C.C.No.17 of 2000 dated 15.06.2007 for the offences
punishable under Sections 13(1)(c ) r/w 13(2) Section
13(1)(d)(i) & (ii) r/w 13 (2) of the Prevention of Corruption Act,
under Section 409 r/w 120-B IPC and Section 477A r/w
Section 120-B IPC.
2. A4 (Syed Anwar Hussain, Senior Assistant) filed
Criminal Appeal No.789 of 2007, A5 (V.Satyanarayana,
Assistant Director) and A7 (M.Hari Narayana) filed Criminal
Appeal No.850 of 2007, A9 (C.Bala Malleswara Rao, Chief
Process Operator) filed Criminal Appeal No.729 of 2007, A10
(G.Chandrasekhar, Compositor) filed Criminal Appeal No.737
of 2007 and A11(K.L.Rama Rao, Machine Man) filed Criminal
Appeal No.828 of 2007.
3. A1 (A.K.Gopalan, former Director, Osmania University)
filed Crl.A.No.1114 of 2010 and the said appeal is decided
separately as A1 was tried separately by trial Court.
4. A2 (Bheem Rao, Cashier) died during the course of trial.
A3 (Ehsan Ahmed Khan, Senior Assistant) filed Criminal
Appeal No.788 of 2007, he died during the pendency of
appeal before this Court, as such, the appeal was dismissed
as abated on 01.02.2024. A6 (B.Sankaraiah, Mono operator)
died during pending trial and A8 (G.Damodar, Mono Type
Operator) filed Criminal Appeal No.793 of 2007, died during
pendency of appeal, as such, the case against A8 is dismissed
as abated.
5. Briefly, facts of the case are that the Registrar of
Osmania University addressed a letter dated 03.12.1993 vide
Ex.P262 in the form of complaint to the Director General,
Anti Corruption Bureau alleging that:
i) there was large scale embezzlement in payment of
over time allowances contrary to the financial rules
and procedure;
ii) Printing material purchased by Director-A1 along
with other employees resulted in misappropriation of
funds;
iii) Purchase of press equipment by A1 along with
other employees deliberately without usage to gain
illegally;
6. On the basis of the said complaint, the Director General,
Anti Corruption Bureau ordered registration of crime and
investigation. Accordingly, the case was registered on
01.01.1994 and investigation was taken up.
7. During the course of investigation, the concerned
witnesses were examined and documents were also collected.
Having concluded investigation, charge sheet was filed
against A1 to A11. The gist of allegations made which are
subject matters of charges framed against appellants and
other accused are:
"1) During 1990-91 to 1992-93, A1 issued self-cheques
amounting to Rs.28,99,343.43ps. The said cheques were
encashed by A2 and A4. The said amount meant for overtime
allowances to the employees were disbursed to an extent of
Rs.11,13,339.59 ps and misappropriated the balance of
Rs.17,86,003.84 ps punishable under Section 13(1) (c ) r/w
13(2) of Prevention of Corruption Act.
2) A1, for the very same orders issued self-cheques and
third party cheques to an extent of Rs.54,71,964.18ps to A2,
A3, A7 to A11, who have encashed the cheques. It was shown
that printing material worth Rs.36,55,560/- was purchased.
However, the remaining amount of Rs.18,16,404-18 ps was
not accounted, punishable under Section 13(1)(c) r/w 13(2) of
PC Act r/w Section 34 of IPC.
3) A1 along with A2 and A4 purchased printing material
including stationery to an extent of Rs.1,18,10,0000.26ps at
exorbitant rates, punishable under Section 13(1)(c) r/w 13(2) of
P.C.Act r/w Section 34 of IPC.
4) A1 has issued self-cheques amounting to
Rs.5,08,502.50ps and A2, A5 and A6 encashed the said
cheques. An amount of Rs.25,470/- was given for private
orders and the remaining amount of Rs.4,83,032.50 ps was
misappropriated, punishable under Section 13(1)(c) r/w 13(2)
of P.C.Act r/w Section 34 of IPC.
5) A1, A3 to A5 and A7 to A11 by corrupt and illegal
means obtained pecuniary advantage to an extent of
Rs.17,86,003.84 ps, Rs.18,16,404-18 ps, Rs.1,18,10,000-26ps
and Rs.4,83,032-50ps, violating financial limits, punishable
under Section 13(1)(c) r/w 13(2) of P.C.Act r/w Section 34 of
IPC.
6) A1, A3 to A5 and A7 to A11 have entered into criminal
conspiracy while discharging their duties and misappropriated
the amounts to an extent of Rs,17,86,003.84 ps,
Rs.18,16,404.18 ps, Rs.1,18,10,000.26ps and Rs.4,83,032.50
ps for purchase of printing material, punishable under Section
409 r/w 34 IPC.
7) A1, A3 to A5 and A7 to A11 have falsified accounts
willfully with an intention to defraud the institution and
caused wrongful loss to the printing press, Osmania
University, Hyderabad to an extent of Rs,17,86,003.84 ps,
Rs.18,16,404.18 ps, Rs.1,18,10,000.26ps and Rs.4,83,032.50
ps, punishable under Section 477-A IPC r/w Section 120-B
IPC."
8. As seen from the allegations/charges against the
appellants, the misappropriation was done in respect of
disbursing overtime allowances to the employees of Osmania
University and purchasing printing material and machinery.
9. The ACB, during the course of investigation, having
collected documents and examining witnesses filed charge
sheet for the offences under Sections 13(1)(c ) r/w 13(2)
Section 13(1)(d)(i) & (ii) r/w 13 (2) of the Prevention of
Corruption Act, under Section 409 r/w 120-B IPC and
Section 477A r/w Section 120-B IPC.
10. The prosecution examined P.Ws.1 to 37 and marked
Exs.P1 to P268. On behalf of the accused, D.Ws.1 and 2
were examined and Exs.D1 to D4 marked. Learned Special
Judge convicted A3 to A5 and A7 to A11 and sentenced to
undergo rigorous imprisonment for a period of one year each
under Sections 13(1)(c ), 13(1)(d)(i) & (ii) r/w 13(2) of the
Prevention of Corruption Act, 1988 r/w 34 IPC, Section 409
r/w 120-B IPC, Section 277-A r/w 120-B IPC.
11. Learned counsel appearing for the appellants would
submit that the learned Special Judge has relied heavily on
the enquiry conducted by P.W.2 against A1, A3 and A4 and
the enquiry report Exs.P15, 16 and 17 respectively. The
findings in the enquiry report were made basis to record
conviction without examining the witnesses or the records
which were examined by the Enquiry Officer during enquiry.
The documents Exs.P1 to P14, P22 to P247 which are
overtime bills, cash books, bank statements, cheques and
registers were all marked through P.W.1, who was Assistant
Registrar, Osmania University. Merely marking the said
documents cannot form basis for the Court to rely upon the
gist of all the documents which were stated by the witnesses
PWs.1 to 4. The prosecution ought to have exhibited before
the Court as to how the misappropriation was done by the
appellants herein.
12. According to the counsel, enquiry was conducted only
against A1 to A4 and there is no enquiry against any of the
other accused. Merely on the basis of conclusions drawn in
the enquiry, all the accused were convicted. The defence
taken by the appellants herein is that it was A1 who had the
cheque power, drawing and disbursing power and responsible
for the accounts of the Osmania Univesity press. Even
according to P.W.1, it was A1 who had informed and
acknowledged that the amounts received were in fact paid to
the persons who had executed job work which are the outside
agencies.
13. Learned counsel for A5 and A7 submits that enquiry
was not conducted against A5 and A7. That itself reflects that
even the department did not have any doubt about the
alleged involvement of A5 and A7. It was further argued that
the other witnesses who are P.Ws.4 to P23 stated that they
have received overtime allowances. It is not the case of P.Ws.4
to 23 who are employees that they have received excess
amounts and paid back the excess amounts to any of the
appellants. It was explicitly stated by P.W.38 that A1 was
responsible for embezzlement and misappropriation and
others have assisted him. However, it was specifically stated
by investigating officer that A3 to A11 were not concerned
with purchase of printing material.
14. Learned counsel appearing for A4 argued that A4 was
not entrusted with any amounts and whatever amounts were
asked to be disbursed by A1, he had disbursed the same. The
allegation that A4 was maintaining overtime allowance
register and other record were not proved by the prosecution.
The Learned Special Judge had relied on the alleged
confession of A4 before the enquiry officer/P.W.2 that he had
withdrawn amount and was also maintaining the records
pertaining to overtime allowances, which formed basis for
conviction, which is incorrect.
15. On the other hand, learned Special Public Prosecutor for
ACB submitted that it is not in dispute that amounts were
entrusted to A1 as the Director for the purpose of disbursing
overtime allowances and also purchase of stationery and
other material. The amounts that were withdrawn by A1, who
had the power to disburse amounts and make payments for
purchase of stationery, has to account for the same. In the
absence of giving details of payments made after withdrawing
the amounts, would clearly reflect that A1 along with other
accused have misappropriated the amounts that were
entrusted to them. The entire documents that were collected
during the course of investigation and examined by PWs.1 to
4 during enquiry that was conducted against A1 to A4 can be
looked into by the criminal Court for the purpose of
adjudicating upon the criminal acts committed by these
public servants. In the said circumstances, learned Special
Judge was right in convicting the accused.
16. Having gone through the record and also the findings of
the learned Special Judge, heavy reliance was placed upon
the enquiry repot of P.W.3 under Exs.P15 to P17 against A1
to A4.
17. P.W.1 worked as Deputy Registrar. According to P.W.1,
the record that was available in the department of printing in
Osmania University was subject matter of the enquiry against
A1. On the basis of the said record, statements were
prepared pertaining to overtime payments, purchase of
stationery items for the years 1990-1991 and thereafter.
P.W.1 prepared Ex.P1 statement showing the details of
amounts drawn for payment of overtime allowances made for
the relevant period. According to Ex.P1, A4 had shown that
he had paid overtime allowances to the employees of Osmania
University. The said statement made by A4 was considered
by P.W.1. P.W.1 then marked Exs.P1 to P14 and P22 to P247,
which are cash book, bank statements, cheque registers,
overtime bills etc. All the said documents were also provided
to the ACB authorities. Similarly, statement Ex.P33 was
prepared with the details of self-cheques and cheques issued
in the name of employees for purchase of material for
Osmania University Press. The said statement was prepared
by P.W.1. Similarly, Ex.P34 is the statement of third party
cheques issued for purchase during the year 1990-91 to
1992-93. Exs.P35 to P148 are the purchases pertaining to
printing material. Ex.P162 is the statement showing
particulars of payments of outside printing bills for the year
1990-91 to 1992-93. According to P.W.1, A5, who is a
technical person prepared Ex.P230 showing existing
machinery in the Osmania University and details of purchase
of new machinery. Ex.P230 was prepared on 22.12.1995.
According to P.W.1, for purchasing machinery for the
Osmania University Press, A1 had to take permission from
the authorities and thereafter call for tenders and then place
it before the purchase committee. After obtaining approval
from the purchase committee, purchase of machinery had to
be made. However, no such permission was taken by A1 for
the purpose of purchase of machinery. During the course of
cross-examination, P.W.1 admitted that there is no evidence
that the entire amount was withdrawn by A 4. However, A4
had disbursed the amount in accordance with the register
maintained by him.
18. P.W.2 worked as Director of Treasuries and he was
asked to conduct enquiry against A1. According to P.W.2, A1
did not cross-examine any of the witnesses except one
witness namely Ram Reddy during enquiry. However, A1 filed
written statement and out of eight charges that were framed
against A1, four charges were proved. The said charges were
pertaining to payment of overtime allowances to the
employees of Osmania University without sanction and
irregularity in purchasing printing papers for Osmania
University. Ex.P15 is the copy of enquiry report. According to
P.W.2, i) Rs.31,83,765/- was misappropriated in OT
allowance, ii) Rs.19,91,922/- misappropriated in purchasing
printing paper; iii) Rs.20,10,090/- misappropriated for
purchasing stationery; iv) Rs.13,92,000/- was
misappropriated for purchase of computer equipment.
19. Further, according to P.W.2 Rs.6,08,000/- was also not
accounted which was towards alleged payments made for
supply of computer equipment. P.W.2 further conducted
enquiry against A4. A4 was given benefit of doubt in the
departmental enquiry since A4 admitted in the departmental
enquiry that he did not keep the records properly regarding
overtime allowances payments. Ex.P17 is the enquiry report
against A4. PW.2 recommended stoppage of three increments.
During the cross-examination, P.W.2 stated that he did not
have any documents to show that he was appointed as
enquiry officer to conduct departmental enquiry against A1 to
A4. Further, charges were not framed against A3 and A4.
P.W.2 admitted that it is the duty of the Director to verify
records of Osmania University printing press.
20. P.W.3 was the Professor in Physics. According to P.W.3,
the Vice-Chancellor appointed three men committee including
P.W.3 to examine the accounts pertaining to Publications of
Osmania University Press for the years 1988-89 to 1992-93
along with Professor Y.Saraswathi Rao and Professor
A.Narsing Rao (both not examined). On 03.06.1993, A1
presented himself before the Committee and he failed to
produce any record. However, the allegations of i)
unauthorized apportionment of income realized through
proceeds; ii) costing procedure; iii) unauthorized
apportionment of payment of overtime allowances to the
employees of Osmania University Press; iv) purchase of
various books like paper, printing material, printing
equipment etc., and v) bogus entries in the stock were all
looked into. Accordingly, on 28.06.1993 Ex.P18, preliminary
report was given and later final report dated 02.09.1993
which is Ex.P19 was handed over to the Vice-Chancellor.
21. According to P.W.3, A1 was responsible for all the
irregularities and unauthorized payments. He was assisted by
A2, A3 and A4. Later, A4 submitted two overtime payment
acquittance registers, which were found to be written
subsequently. However, the said registers were not seized by
the Investigating Officer. During the course of cross-
examination, P.W.3 admitted that A1 was the Drawing and
Disbursing officer and he had cheque power. A1 was
responsible for all the amounts drawn by him and also for
settlement of the accounts. P.W.3 also stated that A1 never
complained against other accused. When questioned by the
counsel for A4, P.W.3 stated that A4 admitted during enquiry
that he was maintaining overtime payment details.
22. P.Ws.4 to P.W.23, witnesses are permanent employees
and also daily wage workers. During evidence, witnesses
stated that they were paid overtime allowances and A2 and
A4 used to take signatures after making payments.
23. P.W.24 was working as Senior Assistant in Arts College.
He stated that A3 used to maintain records. Further, cheques
were written by A2 and A3 and also he used to write cheques.
However, the said cheques were signed by A1. P.W.24
identified A5 and A7 stating that he used to receive cash from
A2 and also cheques were given for payment of money to
outside printers. P.W.24 was declared hostile and cross-
examined by the Public Prosecutor. During cross-examination
by Public Prosecutor, he admitted that some cheques were
being taken by A3 and A5 without signing in the registers.
24. P.W.25 was the Commercial Tax Officer. He had given
information about M/s.Jayshree traders and M/s.Harikishan
and Company for the years 1990-91 to 1992-93, to which
'Firms" payments were made.
25. P.W.26 is another ACTO, who spoke about M/s.Mico
Business Corporation and the registration number of the
Firm.
26. P.W.27 was working under A1 as binder in Osmania
University Press during 1991-92 to 1992-19993. He stated
that P.W.24 used to assist A3 in the purchase section. Third
party cheques were taken by A3, A5, A6 and A7 pertaining to
M/s.Harikishan Company and also M/s.Mac Traders,
M/.OPrime Creative Force, M/s.Mico Business Corporation
and M/s.Metro Traders. Though cheques were being taken in
the name of such firms, signatures were not appended in the
relevant register Ex.P157. In the cross-examination, he stated
that A1 had knowledge about issuance of the cheques and
none of the third parties complained about not receiving the
amounts covered by the cheques which were collected by A3,
A5 to A7. The said cheques which were collected by A3, A5 to
A7 were prepared by A2 at the instance of A1.
27. P.W.28 stated that he was working as Compositor in
Osmania University Press. According to him, whenever they
used to get job work from colleges and there was no
possibility of executing the said work, no objection certificates
were given to the colleges for getting printing done outside.
The concerned college authorities used to get 3 quotations
from private printers and P.W.8 used to accept the lowest
quotations. After printing work was done by the said outside
firms, cheques were being prepared and handed over.
Further, A4 was disbursing overtime allowances.
28. P.W.29 was working as Junior Assistant in the Osmania
University Pres. He did not state anything against accused
and was declared hostile.
29. P.W.30 stated that he has not received any overtime
allowances during 1991 to 1993. He speaks about the
procedure of the printing press taking up the job of printing.
He further stated that he never received any overtime
allowances through A1 to A3.
30. P.W.31 while working as Deputy Director of the
Government Central Press, went to Osmania Hospital
campus and inspected Printing machinery. According to him,
three items were purchased without proposals and four items
were purchased without sanction. However, during cross-
examination, he stated that he was not aware about the
details of the purchases made.
31. P.W.32 was the Assistant Commercial Tax Officer who
furnished information regarding Metro Traders and Metro
Printers and binders to whom payments were made.
32. P.W.33 is the Joint Registrar of Osmania University. He
stated that along with P.Ws.2 and 3, he had conducted
enquiry against A1 to A4. A1 and other officers did not
produce oral or documentary evidence. A1 did not participate
in the enquiry and A3 and A4 participated in the enquiry but
did not produce any evidence in defence. A1 and A4 were
found guilty of the departmental charges and A3 was
exonerated.
33. P.W.34 was assisting A2 in the accounts section. During
the course of enquiry, P.W.34 assisted P.Ws.1 to 3 in the
preparation of statements regarding overtime payments and
also purchase of stationery and machinery.
34. P.W.35 was the Director of Osmania University
Computer Centre. According to him, P.W.3 was appointed as
Enquiry Officer and he assisted P.W.3 during enquiry. The
price paid for computer system by the Osmania University
Press was about Rs.3.00 lakhs whereas the Journalism
Department purchased with similar configuration for an
amount of Rs.1,80,000/- only. The said computer was kept
idle without utilization. It was A1 who had purchased the
said computer.
35. P.W.36 granted sanction orders Exs.P252 to P261 to
prosecute A1 to A11.
36. P.W.37 is the successor of A1. He states that he handed
over the documents that were in the department to P.W.2 for
the purpose of enquiry. Further, he assisted P.W.1 in
preparing statements available in the department regarding
payment of overtime allowances and purchase.
37. P.W.38 is the Investigating Officer who has given details
about the documents that are collected by him during the
course of investigation. He stated that several irregularities
were seen in the payments made and record was not being
maintained for the amounts that were paid. P.W.38 had
taken assistance of P.W.1, P.W.34, P.W.37 for preparing the
statements regarding self-cheques, third party cheques that
were issued by A1 for purchase of material, overtime
payments that were made during 1990-91 to 1992-93.
P.W.38 deposed about the individual seven charges framed
against the accused. During the course of cross-examination,
P.W.36 Investigating Officer stated that A1 directed
withdrawal of the amount and further the person who had
actually withdrawn the amount had to account for the same.
He admitted that there is no evidence on record to show that
the entire amount drawn towards payment of overtime
allowances was entrusted to A1 but A1 was responsible as
the head of the institution. The evidence of misappropriation
is on the basis of record that was available in the office and
verified during investigation. The inferences drawn regarding
misappropriation was based only on the record that was
available. Investigating Officer further admitted that all the
cheques in question were issued by A1 and he did not receive
any complaint from the persons who have undertaken
printing work and stationery suppliers that they did not
receive their amounts for their work. He further admitted that
A2 to A11 were unconcerned with the purchase of printing
machinery.
38. Having gone through the entire evidence and
documents, the basis for prosecuting the accused are the
statements including Ex.P1 showing the details of amounts
drawn for payment of overtime allowances during the year
1990-91 to 1992-93. The said statements were prepared on
the basis of (i) Exs.P2 to P8, overtime bills, (ii) Exs.P9 to P11
counter foils of cheques, (iii) Exs.P12 to P15 cash books.
Thereafter, enquiry report Ex.P15 submitted by P.W.2 against
A1 is also on the basis of Ex.P1. Ex.P15 (there is no date or
signature of P.W.2) is the enquiry report submitted by P.W.2
against A1. Ex.P16 is the report against A3 dated 13.09.1994.
Ex.P17 is the enquiry report against A4 dated 30.09.1994.
39. The complaint under Ex.P262 letter dated 03.12.1993
addressed to ACB and FIR was registered on 01.01.1994 on
the basis of Ex.P262. However, after registration of crime,
P.W.2 conducted departmental enquiry on the basis of the
documents that were seized and statements were prepared
including Ex.P1 for payments of overtime allowances. Ex.P38
is the statement of details of self-cheques issued in the
names of employees during the years 1991-92 to 1992-93.
Ex.P34 is the details of third party cheques for the said
orders. Exs.P35 to P148 pertaining to purchases of printing
material during 1990-1991. Ex.P166 to P229 are the files
pertaining to the work done outside the Osmania University
Press. ExP232 to P245 files are pertaining to purchase of
machinery.
40. According to the enquiry report, A1 did not participate
fully in the enquiry. However, A3 and A4 replied to the charge
memos. As already noted, on the basis of the gist of the
payments made towards overtime allowances, cheques
disbursed and the purchase made, the enquiry officer P.W.3
concluded regarding the misappropriation done. P.W.38, who
is the Investigating Officer states that he has sought
assistance of P.W.2, P.W.1 and others and also relied on the
statements, which forms the gist of payments made and the
amounts that were withdrawn.
41. Appellants have totally denied the allegations leveled
against them regarding any kind of misappropriation. Not a
single witness is examined by the investigating agency to
show that amounts were drawn or cheques issued in favour
of an individual or a firm and such amounts were not paid.
42. Learned Special Judge believed the version of the
prosecution witnesses regarding statements that were
prepared and concluded that under Section 106 of Indian
Evidence Act, the burden is on the accused to explain
regarding the amounts that were withdrawn as such
withdrawals and usage was to the exclusive knowledge of the
accused.
43. In the present case, it is necessary to discuss regarding
the following aspects; i) Whether the statements that were
prepared on the basis of the documents available in the
department can form basis to infer misappropriation and
falsification of accounts, without there being any independent
witnesses examined to support the allegation of drawing or
disbursing amounts in the names of individuals and Firms,
or that such persons have not received amounts; ii) Whether
such statements prepared on the basis of enormous
documents that were examined by witnesses can form basis
to conclude guilt in the absence of proving each and every
document before the Court below; iii) Whether the learned
Special Judge was right in invoking Section 106 of Indian
Evidence Act on the basis of statements prepared by P.Ws.1
to 7 to convict the accused on the ground that the accused
failed to discharge burden shifted on to them.
44. It is not in dispute and admitted that: i) The entire basis
of P.W.2 finding A1, A3 and A4 guilty of the charges of
misappropriation are the statements that were prepared
under Exs.P1 and P35; ii) The Court and the Investigating
Officer/P.W8 heavily relied on Exs.P15 to P19 enquiry reports
of P.W.2; iii) The accused denied execution of any of the
documents that were placed by the prosecution to show
entrustment of the funds to them by A1.
45. Departmental enquiry conducted by any enquiry officer,
who is appointed will conduct enquiry on the basis of
preponderance of probabilities and inferences or conclusions
will be drawn on the basis of the evidence that is placed
before him and/or collected. However in criminal cases, the
principle of proof is beyond reasonable doubt, contrary to the
procedure followed in the departmental enquiry. PW.2,
Enquiry Officer admitted that A1 did not completely
participate in the enquiry but filed statement. A3 and A4
participated, however, they have not cross-examined any
witnesses who were examined during enquiry. According to
P.W.2, A4 produced two registers which appear to have been
prepared at one go apparently, to mislead the enquiry officer.
However, the said registers were not seized by the
Investigating Officer.
46. For the sake of convenience, Section 65 of Indian
Evidence Act is extracted hereunder:
"65. Cases in which secondary evidence relating to
document may be given.
(a)....
(b)....
(c )...
(d)....
(e)....
(f)....
(g)When the originals consist of numerous accounts or
other documents which cannot conveniently be examined
in Court, and the fact to be proved is the general result of
the whole collection.
In case (g), evidence may be given as to the general result
of the documents by any person who has examined them,
and who is skilled in the examination of such
documents."
47. Under Section 65 of the Indian Evidence Act, when
original consists of numerous accounts or other documents
which cannot conveniently be examined in Court and the fact
to be proved is the general result of the whole collection,
evidence may be given as to the general result of the
documents by any person who has examined them and who
is skilled in the examination of such documents.
48. P.W.2 enquiry officer or for that matter, P.W.1, P.W.3
who assisted P.W.2 during enquiry and all of them in turn
who had assisted Investigating Officer/P.W.38 did not speak
about, they being experts or skilled in the examination of the
documents which were examined during preparation of
Exs.P1 and P35. There were admittedly two almirahs filled
with documents which were examined and the gist prepared
under Exs.P1 and P35. P.Ws.1 to 3 have not stated that they
have any expertise in preparation of such statements. P.W.1
worked as Deputy Registrar of the Accounts Division, PW.2
retired as Director of Treasuries and Accounts, P.W.3, who is
retired Professor in Physics. For argument sake assuming
that P.Ws.1, 2 and 3 had correctly prepared the statements
which is the general result of examining several hundred
documents and files, there is no evidence that such
documents were prepared by the appellants herein. During
the course of cross-examination and also Section 313 Cr.P.C
examination, the accused denied the documents and its
correctness. On the basis of which, Exs.P1 and P35
reflecting misappropriation were prepared.
49. It is for the prosecution to prove beyond reasonable
doubt that the documents were in fact prepared and
maintained by A4.
50. It is not the case that A4, A5, A7, A9 to A11 have in any
manner prepared or maintained the accounts or files that
formed basis for preparation of Exs.P1 and P35 statements
showing irregularities. The said statements, in such scenario,
cannot be made basis to infer that there was
misappropriation by the appellants herein in collusion with
A1. Admittedly, most of the amounts were withdrawn on the
basis of cheques issued by A1.
51. Under Section 106 of the Evidence Act, the initial
burden is always on the prosecution to prove its case and
then burden shifts on to the accused. As already discussed,
the prosecution utterly failed to prove that files and registers
which formed basis to prepare Exs.P1 and P35 statements
showing misappropriation, were admitted or that they were
maintained by the appellants herein.
52. The Hon'ble Supreme Court in the case of Balvir Singh
v. State of Uttarakhand 1 held that when the prosecution
has offered evidence which can be believed by the Court and
convincing regarding the accused guilt beyond reasonable
doubt, then the burden shifts on to the accused to present
evidence regarding the facts peculiarly which are within the
knowledge of the accused. All the documents that were seized
and examined by P.Ws.1 to 3, P.W.38 Investigating Officer
were available in the office. When statements are prepared on
the basis of the said documents, there is no question of any
exclusivity of the knowledge of any facts to the accused when
the documents are denied by accused. On the basis of such
statements Exs.P1 & P35 being prepared, the trial Court
cannot place burden on the accused to explain such
statements and the conclusions drawn by enquiry
officer/P.W.2 regarding the amounts that were allegedly
misappropriated. The approach of the learned Special Judge
in shifting the burden on to the accused to explain the
opinion and inferences drawn during departmental enquiry is
2023 SCC OnLine SC 1261
incorrect and it does not fall within the purview of Section
106 of Indian Evidence Act to draw adverse inference against
accused and convict the accused. In view of above
discussion, in the absence of any proof and direct evidence
against the accused apart from the inferences drawn by
P.Ws.1 to 3 and P.W.38, on the basis of the record found in
the office, there cannot be any conviction for the offences
alleged.
53. Section 13(c) of the Act is akin to Section 409 of IPC.
Both under Section 13(c ) of PC Act and Section 409 of IPC,
the sine qua non to establish the offence of misappropriation
is to prove entrustment. The factum of entrustment to the
appellants herein are assumptions on the basis of the
withdrawals from Banks and payments made by A1 through
cheques. Admittedly, self cheques were drawn and signed by
A1. Not a single bank witness is examined to show that at
any point of time, self-cheques or the cheques of others were
encashed in the bank by any of these appellants. The
prosecution ought to have produced witnesses from the Bank
to prove that cheques signed by A1 were withdrawn by the
appellants herein. In the absence of any such proof, the
question of these appellants abetting A1 in committing
alleged misappropriation of the funds entrusted to A1 would
not arise.
54. The Hon'ble Supreme Court in the case of R.Sai
Bharathi v. J.Jayalalitha 2 held that entrustment has to be
proved for establishing an offence of criminal
misappropriation.
55. The case is one of circumstantial evidence. The burden
is on the prosecution to prove the circumstances of the case
by admissible and legal evidence. All such circumstances
cumulatively should form a complete chain pointing
unerringly towards the guilt of the accused. The
circumstances relied upon by the prosecution should be
incompatible with the innocence of the accused leading to the
only conclusion of the guilt of the accused. The Hon'ble
Supreme Court in the case of State of Uttar Pradesh v.
Sukhbasi 3, Haricharan v. State of Rajasthan 4 held that
AIR 2004 SC 892
AIR 1985 SC 1224
where there are missing links in the chain of evidence
adduced by the prosecution, benefit of doubt should go to the
accused.
56. In Anthony D'Souza v State of Karnataka 5, the
Hon'ble Supreme Court held that in order to sustain
conviction, the evidence produced by the prosecution should
not only be consistent with the guilt of the accused but
should also be inconsistent with the innocence of the
accused.
57. In view of above discussion, the prosecution has failed
to provide evidence to prove guilt of the accused and
accordingly, benefit of doubt is extended to the appellants
herein.
58. In the result, the judgment in C.C.No.17 of 2000 dated
15.06.2007 is hereby set aside against A4, A5, A7, A9, A10
and A11. Since the appellants are on bail, their bail bonds
shall stand discharged.
AIR 1998 SC 244
(2003) 1 SCC 259
59. Criminal Appeal Nos.789, 850, 729, 737 and 828 of
2007 are allowed. Criminal Appeal No.793 of 2007 is
dismissed against A8, as abated.
__________________
K.SURENDER, J
Date: 16.04.2024
kvs
