R IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 3RD DAY OF APRIL, 2019 BEFORE THE HON’BLE MR. JUSTICE N.K. SUDHINDRARAO CRIMINAL APPEAL No.914/2010 C/W CRIMINAL APPEAL Nos.957/2010, 956/2010, 928/2010, 961/2010, 958/2010 AND 934/2010 IN CRL.A.No.914/2010:
BETWEEN JAGADEEP R THADANI S/O RAMCHAND THADANI 44 YEARS, DIRECTOR OF M/S BELAIR ESTATES PVT LTD., NO.167, MLA LAYOUT, R.T.NAGAR MAIN ROAD, BANGALORE-32 R/A A-1, 10TH FLOOR, MATRU ASHISH BUILDING, 39 NAPEAN SEA ROAD, MUMBAI – 400 036.
(BY SRI. S G BHAGAVAN, ADVOCATE) AND THE STATE BY CBI/ACB BELLARY ROAD, BANGALORE (BY SRI. P PRASANNA KUMAR, SPL PP) ... APPELLANT ... RESPONDENT THIS CRIMINAL APPEAL IS FILED U/S.374(2) CR.P.C PRAYING TO SET ASIDE THE CONVICTION AND SENTENCE DATED 30.8.10 PASSED BY THE XXI ADDL. CITY CIVIL AND SESSION JUDGE AND SPECIAL JUDGE FOR CBI CASES, BANGALORE IN SPL.C.C.NO.134/98-CONVICTING THE APPELLANT/ACCUSED FOR THE OFFENCE PUNISHABLE UNDER SECTION 120B READ WITH 420 OF IPC.
IN CRL.A.No.957/2010:
BETWEEN C SUBBRAYAN S/O CHEVATTAN No.18(31) SHAMMANNA BUIDLING, 1ST MAIN, 1ST CROSS, MATHIKERE BANGALORE. …APPELLANT (BY SRI. S K VENKATA REDDY, ADVOCATE) AND STATE BY CBI:ACB BANGALORE.
...RESPONDENT (BY SRI. P PRASANNA KUMAR, SPL PP) THIS CRIMINAL APPEAL FILED UNDER SECTION 374(2) CR.P.C., FOR THE APPELLANT/ACCUSED No.2 PRAYING TO SET ASIDE THE ORDER OF CONVICTION AND SENTENCE DATED 30.08.2010 PASSED BY THE XXI ADDITIONAL CITY CIVIL AND S.J. AND SPECIAL JUDGE FOR CBI CASES, BANGALORE IN SPL.C.C.No.134/98- CONVICTING THE APPELLANT/ACCUSED No.2 FOR THE OFFENCE PUNISHABLE UNDER SECTIONS 120B, 420, 468, 471 IPC AND SECTION 7, 13(2) R/W 13(1)(d) OF PREVENTION OF CORRUPTION ACT, 1988.
IN CRLA.No.956/2010:
BETWEEN B N RAJANNA S/O LATE NANJACHAR No.B3, 61, A.T.STREET SRIRANGAPATNA MYSORE DISTRICT.
(BY SRI. S K VENKATA REDDY, ADVOCATE) AND STATE BY CBI: ACB BANGALORE.
... APPELLANT ...RESPONDENT (BY SRI. P PRASANNA KUMAR, SPL. PP) THIS CRIMINAL APPEAL IS FILED UNDER SECTION 374(2) OF CR.P.C., PRAYING TO SET ASIDE THE ORDER OF CONVICTION AND SENTENCE DATED 30.08.2010 PASSED BY THE XXI ADDITIONAL CITY CIVIL AND SESSION JUDGE AND SPECIAL JUDGE FOR CBI CASES, BANGALORE IN SPL.C.C.No.134/98-CONVICTING THE APPELLANT/ACCUSED No.4 FOR THE OFFENCE PUNISHABLE UNDER SECTIONS 120B, 420 OF IPC SECTION 13(2) READ WITH 13(1)(d) OF PREVENTION OF CORRUPTION ACT, 1988.
IN CRL.A.No.928/2010:
BETWEEN S NARAYANAMURTHY AGED 46 YEARS S/O LATE K SRINIVASAMURTHY 6TH CROSS, VIDYARANYAPURA MYSORE.
PRESENTLY RESIDING AT No.49 1ST CROSS, NIVEDITA NAGAR MYSORE – 570 023.
(BY SRI. S G BHAGAVAN, ADVOCATE) AND THE STATE BY CBI/ACB BELLARY ROAD BANGALORE.
(BY SRI P PRASANNA KUMAR, SPL. P P) ... APPELLANT ...RESPONDENT THIS CRIMINAL APPEAL IS FILED UNDER SECTION 374(2) OF CR.P.C PRAYING TO SET ASIDE THE CONVICTION AND SENTENCE DATED 30.8.2010 PASSED BY THE XXI ADDITIONAL CITY CIVIL AND SESSION JUDGE AND SPECIAL JUDGE FOR CBI CASES, BANGALORE IN SPL. C.C.No.134/98-CONVICTING THE APPELLANT/ACCUSED FOR THE OFFENCE PUNISHABLE UNDER SECTION 120B R/W 420 & 468 OF IPC.
IN CRL.A.No.961/2010:
BETWEEN R S SETHURAMAN S/O SRI V.K.S MANI No.4, "SRIKRISHNA"
BEHIND BHIMA JYOTHI LIC COLONY W.C ROAD, BANGALORE – 560 079.
(BY SRI. S G BHAGAVAN, ADVOCATE) AND THE STATE BY CBI/ACB BELLARY ROAD BANGALORE.
(BY SRI. P PRASANNA KUMAR, SPL PP) ...APPELLANT ...RESPONDENT THIS CRIMINAL APPEAL IS FILED U/S.374(2) OF CR.P.C PRAYING TO SET ASIDE THE CONVICTION AND SENTENCE DATED 30.08.2010 PASSED BY THE XXI ADDITIONAL CITY CIVIL AND SESSION JUDGE AND SPECIAL JUDGE FOR CBI CASES, BANGALORE IN SPL.C.C.No.134/98-CONVICTING THE APPELLANT/ ACCUSED FOR THE OFFENCE PUNISHABLE UNDER SECTION 120B READ WITH 420 OF IPC.
IN CRL.A.No.958/2010:
BETWEEN B C ASHWATH S/O SRI CHIKKADE GOWDA BABARAYANA KOPPAL SRIRANGAPATNA TALUK MANDYA DSITRICT. ... APPELLANT (BY SRI. S K VENKATA REDDY, ADVOCATE) AND STATE BY CBI:ACB BANGALORE. ...RESPONDENT (BY SRI. P PRASANNA KUMAR, SPL. P P) THIS CRIMINAL APPEAL IS FILED UNDER SECTION 374(2) OF CR.P.C PRAYING TO SET ASIDE THE CONVICTION AND SENTENCE DATED 30.8.10 PASSED BY THE XXI ADDITIONAL CITY CIVIL AND SESSION JUDGE AND SPECIAL JUDGE FOR CBI CASES, BANGALORE IN SPL.C.C.No.134/98-CONVICTING THE APPELLANT/ ACCUSED FOR THE OFFENCE PUNISHABLE UNDER SECTION 120B READ WITH 420 & 468 OF IPC.
IN CRL.A.No.934/2010:
BETWEEN M D BHEEMA NAIDU S/O LATE DHARANIPALAN, AGED ABOUT 50 YEARS, OCC: AGRICULTURIST, NO.73/1, GOVT, HOUSE ROAD, NAZARABAD, MYSORE. ...APPELLANT (BY SRI. K A CHANDRASHEKARA, ADVOCATE) AND STATE BY CBI:ACB BANGALORE.
...RESPONDENT (BY SRI. P PRASANNA KUMAR, ADVOCATE) THIS CRIMINAL APPEAL IS FILED UNDER SECTION 374(2) OF CR.P.C PRAYING TO SET ASIDE THE CONVICTION AND SENTENCE DATED 30.8.2010 PASSED BY THE XXI ADDITIONAL CITY CIVIL AND SESSION JUDGE AND SPECIAL JUDGE FOR CBI CASES, BANGALORE IN SPL.C.C.NO.134/98-CONVICTING THE APPELLANT/ ACCUSED FOR THE OFFENCE PUNISHABLE UNDER SECTION 120B READ WITH 420 & 468 OF IPC.
THESE CRIMINAL APPEALS HAVING BEEN HEARD AND RESERVED ON 08.08.2018 AND COMING ON FOR PRONOUNCEMENT OF ORDERS THIS DAY, THE COURT DELIVERED THE FOLLOWING.
JUDGMENT These seven appeals by the accused Nos.2,4,6,7, 8, 9 and 10 respectively are directed against the Judgment dated 30.08.2010 passed in Special CC No.134/1998 by the XXI Additional City Civil and Sessions Judge and Special Judge for CBI Cases, Bangalore, wherein accused were convicted for the following offences and sentenced as under:
of Rs.20,000/- in default SI for 6 months for the offence u/S 420 IPC.
3. SI for 3 years & fine of Rs.25,000/- in default SI for 6 months for the offence u/S 468 IPC.
2. Accused No.1 -Shivanna, Accused No.5- A Narasimha Murthy died during trial. Accused No.3- K Ramanna died during the pendency of Criminal Appeal No.955/2010 and the said appeal stands abated as per the order dated 08.08.2018.
3. For better understanding, parties are hereinafter referred with reference to their status as stood before the trial court.
4. The substance of the Complaint is as under:
A complaint came to be registered in RC No.6(A)/1996 on 05-02-1996 at 4.15 p.m. by the complainant. Place of occurrence of the offence is shown at two places, viz. Mysore and Bangalore. It is stated that the course of offence is said to have started during October 1995. The complainant is one Sri. V. Ashok Kumar, Inspector of Police, CBI, Bangalore.
5. On 03.10.1995, (1) Accused No.1-Shivanna, Tax Recovery Officer, Income Tax Department, Bangalore;
(2) Accused No.2- C.Subbarayan, Income Tax Inspector, Income Tax Department, Bangalore; (3) Accused No.3 K.Ramanna, UDC, Income Tax Department, Bangalore, entered criminal conspiracy with a private person, Shyamprasad, in order to cause wrongful loss to Income Tax Department and to enjoy wrongful gains for themselves. The platform for the offence by the accused is said to be ‘auction of a vacant land’ being conducted by Income Tax Department by its officials by allotting the same to accused No.8-Jagadeep R. Thadani, at a low and throw away price by adopting dubious and illegal methods.
6. The Income Tax Department ordered for auction of property of about 10 acres of land, comprised in Survey No.4, Kurubarahalli, near Zoo Garden, Mysore City, belonging to Sri. Srikanta Datta Narasimharaja Wadiyar, who is the lineal descendant of former Maharaja of Mysore.
7. It was accused No.1- Shivanna, who was entrusted with the duty of conducting the auction towards the recovery of tax dues. Accused Nos.2 and 3 conniving with accused No.1 ensured through the conspiracy with accused No.4 that the said land situated at a premium locality goes to accused No.8. In this connection, it is stated that:
(i) The accused persons No.1 to 10 consisting of public servants and private individuals steadily and systematically committed the offence conspiring and used their intelligence for illegal purpose.
(ii) Accused Nos.1 to 3 manipulated minutes deliberately, illegally and with a malafide intention enacted a stage managed public auction notifying the price of Rs.2,00,000/- per acre in respect of 10 acres of land in survey No.4, Kurubarahalli, near Zoo garden Mysore, and understanding with four bidders having participated in the auction and three of them did not succeed and accused No.8 was declared the highest bidder and his bid for Rs.21,00,000/- for 10 acres was accepted. The said auction was conducted on 30-10-1995 at 5.00 p.m. at Mysore.
A public auction was notified to be conducted at Mysore in Karnataka by the Income Tax Authority for conducting the sale by public auction of the immovable property in the form of land to the extent of ten acres in survey No.4, Kurubarahalli, near Zoo garden Mysore, belonging to late Sri. Srikanta Datta Narasimharaja Wadiyar, the lenial descendant of erstwhile Maharajas of Mysore. It is stated that the said property was notified to be auctioned as the said Sri. Srikanta Datta Narasimharaja Wadiyar failed to clear huge arrears of Tax of Rs.7,51,05,327/-. Further stated that public auction was conducted and completed at Room No.115 at Hotel Krishna Continental, Mysore on 30.10.1995.
Some of the features of the public auction dated 30.10.1995 as stated by the prosecution are as under:
(i) The auction was conducted in respect of ten acres of land in survey No.4 in a premium locality of Kurubarahalli, near Zoo garden Mysore City.
(ii) No proper notice was given to the defaulter Sri. Srikanta Datta Narasimharaja Wadiyar.
(iii) There was a plan to prevent participation of bidders in large number as it would have boomeranged. Thus participants were restricted.
(iv) There was no proper and valid notice either to the public, more particularly, to PW-5- Sri. Srikanta Datta Narasimharaja Wadiyar. The public notice of proclamation was done through news paper.
(v) The auction was conducted in Hotel Krishna Continental, at room No.115 on 30.10.1995 and conducting of the same at or near the property to be auctioned was never considered.
(vi) The demand draft, pay-in slip vouchers regarding a portion of amount of highest bid were ready well in advance to public auction considering the business hours of the Bank.
(vii) The reserve price of the land of ten acres in survey No.4, Kurubarahalli, near Zoo garden, Mysore, was fixed at Rs.2,00,000 per acre and the highest bid of the accused No.8 was Rs.2,10,000/- per acre. The accused were thus successful in conducting the activity in order to make dishonest and wrongful gain by causing dishonest loss to Sri.Srikanta Datta Narasimharaja Wadiyar.
8. The complaint is marked as Ex.P-114 and it is stated accused persons consisting of public servants (Income Tax officials) and private individuals conspired for committing the offence punishable under Sections 120B, 420,468,471 of IPC and also offence punishable under Sections 7 and 13(2) read with 13(1)(d) of Prevention of Corruption Act, 1988.
9. In respect of the public servants-accused persons sanction orders were obtained to prosecute them from the respective competent authorities.
10. Final report filed by the CBI/ACB reflect the names of totally ten accused persons, viz., (i) Accused No.1-Shivanna, S/o. Late Sri Somaiah, No.6, Survey No.55, Chikkallasandra, Subramanyapura Main Road, Uttarahalli Hobli, Bangalore-61;
(ii) Accused No.2-C.Subbarayan, S/o. Late Sri Chevattan, No.18(31), Shamanna Building, I main, I cross, Mathikere, Bangalore;
(iii) Accused No.3-K.Ramanna, S/o. Late Sri. Kenchappa, No.223, Ii phase, 11-B Cross, 18th Main, J.P.Nagar, Bangalore-78;
(iv) Accused No.4-B.N.Rajanna, S/o. Late Shri. Nanjachar, No.B-3, 61 A.T.Street, Srirangapatna, Mysore District;
(v) Accused No.5-Narasimhamurthy, S/o. Shri. Appanna, No.127/2, Domaplur Village, Bangalore-71;
(vi) Accused No.6-S.Narayanamurthy, S/o. Late Shri. K Srinivasamurthy, No.998, 3rd Main, 6th Cross, Vidyaranyapura, Mysore;
(vii) Accused No.7- R.S.Sethuraman, S/o. Shri. V.K.S.Mani, No.4, ‘Srikrishna’, Behind Bhima Jyothi LIC colony, W.C.Road, Bangalore-79;
(viii) Accused No.8-Sri.Jagadeep R.Thadani, Director of M/s.Belair Estates Pvt. Ltd., S/o. Shri. Ramchand K.Thadani, No.167, MLA Layout, R.T.Nagar Main Road, Bangalore -32.
a) No.153, Monalisa Building, Bomanjipetit Road, Kemps corner, Bombay.
b) C/o Smt.Kavitha(torn) Flat No.1, 10th Floor, Matru Ashish Buildings, Napeansea, Bombay.
(ix) Accused No.9-B.C.Aswath, S/o. Shri. Chikkade Gowda, Babrayana Koppal, Srirangapatna Taluk, Mandya District, Karnataka; and (x) Accused No.10-M.D.Bheema Naidu S/o. Late Dharanipalan, No.73/1, Government House Road, Nazarabad, Mysore.` 11. After hearing the accused, the Special Judge framed charges against the accused on 03.03.2004 for the offence punishable under Sections 120B (Criminal conspiracy), 420 (cheating & dishonestly inducing delivery of property, 468 (Forgery for purpose of cheating), 471 (using as Genuine a forged document or electronic record) of IPC and Sections 7, 13(2) (Criminal misconduct by a public servant) read with Section 13(1)(d) of Prevention of Corruption Act. As the accused persons pleaded not guilty, they were tried.
12. The CBI, in order to establish the guilt of the accused persons, examined as many as 46 witnesses as PW-1 to PW-46, got exhibited the documents as Ex.P1 to P218 and also marked MOs 1 to 4.
13. During the trial, accused No.1 Shivanna and Accused No.5-A. Narasimhamurthy were reported dead, consequently case against them came to be abated. The trial Jduge, considering the oral and documentary evidence, convicted the accused for the said offences and sentenced them, as stated above. The same is challenged by the accused in these appeals.
Subsequent to disposal of the case and during the pendency of the appeal, Accused No.3-K. Ramanna, appellant in Crl.A.No.955/2010 was reported dead, and the said appeal also stands abated.
14. Thus, accused persons who are before this Court under these appeals are as under:
(i) Accused No.2-C.Subbarayan;
(ii) Accused No.4- B.N.Rajanna;
(iii) Accused No.6-S. Narayanamurthy;
(iv) Accused No.7- R.S.Sethuraman;
(v) Accused No.8-Sri.Jagadeep R.Thadani;
(vi) Accused No.9-B.C.Aswath;and (vii)Accused No.10-M.D.Bheema Naidu.
15. Learned counsel for accused No.2/appellant in Crl.A.No.957/2010 would submit that firstly the provisions of Prevention of Corruption Act, 1988, is not applicable as there was no demand either directly or indirectly nor was there any acceptance or work of any of the prosecution witnesses are effected.
16. Learned counsel further submits that at Hotel Krishna Continental, Mysore, PW5 was present, as spoken by PW31 that decreases the possibility of even suspicion.
17. Further he submits that recovery as per Ex.P118 search list dated 6.2.1996, inventory as per Ex.P119 have no basis as there was no offence that enabled the search.
18. Further there are no eye witness or a circumstance to render the demand and receipt within the meaning of the Prevention of Corruption Act, 1988. He would further submit that this accused is victim of circumstances.
19. Learned counsel for accused No.4/appellant in Crl.A.No.956/2010 submitted that the allegation of the prosecution that he was present when the main offence i.e. auction dated 30.10.1995 was conducted and arranged accused No.9, dummy bidder. Further, he is stated to be present on 30.10.1995 along with accused Nos. 1,2,3,10 as per the evidence of PW31 and that cannot be an offence.
20. Learned counsel for accused No.6/appellant in Crl.A.No.958/2010 submits that the allegation is that this accused was a close associate of accused No.4-
B.N.Rajanna. He is one of the bidder upto Rs.2,03,000/- as per Ex.P3.
21. Learned counsel for accused No.7/appellant in Crl.A.No.961/2010 would submit that it is the allegation that he was the middleman of accused No.8 and that is not correct.
22. Learned counsel for accused No.9/appellant in Crl.A.No.958/2010 would submit that accused No.9 is a bonafide bidder and his act of participation can never be regarded as an offence under any provision of law.
23. Sri. P. Prasanna Kumar, learned Special Public Prosecutor for complainant/CBI, would submit that the prosecution has proved the commission of offence charged against the accused. He would further submit that most of the witnesses are public servants and the other witnesses do not have bad antecedents or remarks.
24. It is further submitted that the case has witnessed exploitation of victim to the maximum extent. The only inference that can be drawn through the material on record is that the public auction dated:30.10.1995 is itself an offence. It is further submitted that the accused persons used intelligence to cover the offence. But idea was thwarted because of intervention of the complainant as the said auction dated:30.10.1995 was recalled by the Commissioner of Income Tax.
25. Accused No.2 is the Income Tax Inspector and he prepared and reported that he had made order of proclamation of sale, altered the value of the property to drastically reduce it and was present at the time of auction at the spot to ensure the auction is commenced, conducted and completed and he created the records to convert the valuable property. Further, forged the records and scheme in furtherance of conspiracy made a platform in the form of auction to ensure that the property is sold at a throwaway price with the malafide intention of making dishonest gain. Also prepared false statement/report and converted records relevant for auction of the property in question belonging to PW5-Srikanta Datta Narasimharaja Wadiyar and succeeded in the scheme along with other accused in selling property in question for Rs.21,00,000/-.
26. Accused No.4 being a public servant working as UDC, is part of the fictitious auction dated 30.10.1995 and even had applied CL on 30.10.1995 and present at the spot, ensured that he receives illegal gratification from the beneficiary of the said illegal auction.
27. Accused Nos. 6,9 and 10 are private persons.
Accused No.6 is very much acquainted with Shyamprasad. He is one of the bidders who enabled Accused No.8 to come out as the highest bidder with Rs.21,00,000/- for 10 acres of property in question played his role as planned, a conspiracy to manage, and ensured to see that accused No.8 will be highest bidder.
28. Accused No.7, Sethuraman is the middle man liasoning accused No.6 and 8 as revealed by the evidence of PWs 24 and 25.
29. It is also claimed by the prosecution that every body here have planned a perfect project that was not only illegal but a threatening one. The masterminded scam would not have been possible had there was no conspiracy among the accused, The public servants/accused ensured that entire set of proceedings or documents that become necessary, also taking precautions so that the dark deeds stayed in darkness, that brought a dis-respect to the department, as they committed the offence and ill- gotten wealth could not be shared because of the order passed by the Commissioner of Income Tax canceling the result of the auction of that property. However, portion of the amounts said to have been received were recovered through mahazar by the CBI.
30. The onus is on the complainant-CBI to establish whether the landed property measuring 10 acres comprised in Survey No.4, Kurubarahalli, near Zoo Garden, Mysore City, that belonged to Sri. Srikanta Datta Narasimharaja Wadiyar was undervalued and sold to a collusive purchaser accused No.8 on 30-10-1995 for a throw away price at Rs.2,10,000/- per acre.
31. The sworn testimony of PW1-C.V.Padmanabhan, who was the Commissioner of Income Tax during the relevant period is regarding the procedure for recovery of tax. As per his version, the Assessing Officer certifies the quantum payable, collects a list of properties owned and possessed by the assessee, hands over the list to TRO-Tax Recovery Officer. Tax Recovery Officer issues the order of attachment of the property which is proposed to be sold and then seeks permission from the Income Tax Department for sale of the attached property and the same has to be informed to the assessee. But for all the legal and practical purposes, this would be the final opportunity for the asseessee to clear the dues and save the property.
32. In the present case, accused No.1 was the Tax Recovery Officer and accused No.2 was the Income Tax Inspector. As per the records, reports and the other relevant documents the table showing the reports filed and action taken by accused persons are already mentioned.
33. According to PW1 it is mandatory for the Accused No.1-Tax Recovery Officer to obtain permission before fixing the Reserve Price. PW1 is said to be the Superior to Tax Recovery Officer.
34. The reserve price was fixed at Rs.2,00,000/- per acre and for the total extent of 10 acres, it is Rs.20,00,000/-. The property was sold for Rs.21,00,000/- at Rs.2,10,000/- per acre. It is this witness who passed the order setting aside the auction dated 30.10.1995 as per Ex.P1 dated 29.3.1996. No material or fatal admission are elicited from this witness.
35. PW2-Selvaraj, Tax Recovery Officer, Range-3, Income Tax Department tells about the procedures which is already spoken by PW1. He also tells that first they have to receive the intimation from Assessing officer with regard to arrears to be recovered from the assessee, it will be given in ITCP Form No.1, after service of the same, if he has not paid the arrears within 15 days, the time stipulated for the purpose of the payment in the said form, they will issue another notice for attachment of the movable and immovable property in ITCP Form No.16 to the assessee and one copy will be affixed to the office notice board and the related procedures as spoken by PW1.
The documents that are identified and got marked by him are: Ex.P2- File in respect of auction of the property of PW5 which contains 1 to 193 sheets. He speaks about non availability of ITCP Form served by accused No.1 to assessee. He also tells about the list of bidders with address as per Ex.P3 and list of bidders at the spot of auction as per Ex.P4. He also speaks that the highest bidder was accused No.8- Jagadeep Thadani through his agent one Mr. Sham Prasad. It is also clear that no paper publication was made. He denies the suggestions made against the prosecution.
36. PW3- M.V. Bhanumathi, Assistant Director of Income Tax (Investigation) Mysore, during the relevant period, who has verified the list of bidders and accused No.8 was the highest bidder and addresses of the bidders mentioned in the fax message were false. No proper auction was conducted.
37. PW4-B.N.Mohan, Income Tax Officer, Ward I, Mandya, during the relevant time and he tells that he knows accused No.4 B.N.Rajanna, he was working as UDC and granted leave to Accused No.4 on 25.10.1995 (RH) and on 30.10.1995 (CL) (leave application is dated 28.10.1995).
38. PW5-Srikanta Datta Narasimharaja Wadiyar, is an assessee and defaulter in payment of tax of Rs.7,51,05,327/-. During his oral evidence, he asserts that the land which was subjected to auction worth Rs.30 to 40 lakh per acre. He makes representation to the Union Finance Miniser stating about the illegalities in sale proclamation, reserve price and the related. He further intimated accused No.1 that High Court of Karnataka in W.P.No.19404/1997 stayed the collection of arrears and also enclosed the letter as Ex.P1. This witness complains that he did not receive the notice of auction dated 30.10.1995 He also lodges a complaint to Commissioner of Income Tax, who later passed an order canceling the said auction.
PW6-Sathya Dharma, Income Tax Officer, DIR (I), Bangalore – he was in charge of grant of leave and sanctioned leave to accused No.5 and there is no cross examination.
39. PW7-Mohammed Amanulla, Deputy Manager (NRI) SBI JC Road, during the relevant period and maintained NRI accounts in SBI and Foreign Exchange and has handedover two documents, i.e. pay-in-slips dated 30.10.1995 and 10.11.1995 pertaining to Thadani and Belair Estate as per Ex.P21 and P22. Ex.P21 was given by Accused No.8 for collecting bankers cheque for Rs.5.00 lakh in favour of Tax Recovery Officer, Bangalore.
40. PW8- M.A.Srinivas, Chartered Accountant and he represents PW5- Sri. Srikanta Datta Narasimharaja Wadiyar in the Income Tax Department for the purpose of filing the returns and attending his cases.
41. PW9-Jayaram, District Registrar and Deputy Commissioner, Mysore, who provides the description of property and states that the value of the property fixed is not as per guidelines.
42. PW10-Chandrashekar was doing Tourist business who provides vehicles for trips and maintains trips sheets. He states that an Ambassador was given to A3 from Bangalore to Mysore on 27.10.1995 and Maruthi van was given to A3 from Bangalore to Mysore and Nanjangud on 30.10.1995 as per Exs.P41 and P43.
43. PW11-G. Girish, Cushion workers who is the witness for Ex.P45-panchanama dated 22.9.1998.
44. PW12-P.V.Rai, Director in Rural Development Self Employment training Institute, Mysore and working as Manager in Divisional Office, Mysore who tells about Fixed deposits made by deceased accused Sham Prasad.
PW13-Dhanaraj, pawn broker states that Accused No.1 pledged a gold chain on 14.1.1996 as per Ex.P58.
PW14-S.Kadaraiah, Sub Registrar, Mysore North Taluk and he states that the value of the property is around Rs.500/- per Sq.Ft. and approximately around Rs.10—12 lakhs per acre.
PW15-Manju Shetty, Businessman and friend of Accused 5. He states that he had borrowed a total of Rs.1,15,000/- from A5 in December 1996 which was seized by CBI. He also tells that he had deposited Rs.1,15,000/- and an additional Rs.10,000/- as per Ex.P60.
PW16-Narasamma, sister of wife of Accused No.5 and from whom Rs.80,000/- was seized . PW17- Karpagam is the wife of accused No.2, and from whom Rs.50,000/- was seized as per Ex.P73 and they turn hostile to the case of the CBI.
PW18-Cheluvachar, and PW20-Narasimhaiah are the postman who have issued endorsement as per Exs.P74 and P75.
PW19-S.M.Ganguly, working as Manager, SBI he tells regarding stopping of payment on the order of CBI.
PW21-K.V. Chowdary, Additional Commissioner of IT, Bangalore, PW22-Prakash Adnur, Joint Commissioner of IT, Mysore, PW23-G.R. Reddy, Commissioner of IT, Karnataka, are the authorities who have issued sanction orders in respect of A3,A4,A1,A2 respectively.
PW24-Gopinath and PW25-Ravi Hegde are doing business in Real Estate and they speaks regarding the auction.
PW26-R. Parthasarathy, is an Practicing Company Secretary who handles registration of companies.
PW27-R. Ranganatha, is the Income Tax Officer, Ward 14, Bangalore and working as Inspector to ASIT (I) who was asked to verify the address of M/s. Belair Estates Pvt.Ltd .
PW28-Mallikarjuna, Postman who has issued endorsement in respect of RPAD sent to Akram Basha.
PW29-Jayashree Mulki, Assistant Commissioner of IT (Vigilance) Karnataka Circle, Bangalore who has issued letter, copies of cheques and other documents to SP CBI as per Ex.P84.
PW30-K.A. Mallikarjuan, ITO, ADIT (I) Mysore, who has ascertained the value of the property in question from the office of the Deputy Registrar of Stamps and Registration.
PW31-Thimmaraya Gowda, Tax Recovery Officer, Group D, Bangalore who has accompanied Accused 2 and 3 along with briefcase with documents to the house of accused No.1 and also to Mysore.
PW32-Usha Govindhan, Additional Commissioner of IT, Bangalore, approved the proposal letter dated 21.8.1995.
PW33-S.M.Nagaraju, Commissioner of MUDA who speaks that it was part of his job to auction sites and aware of prevailing rates.
PW34-C.M.Shanthaveeraiah, Deputy Manager, SBI, Bangalore, at the relevant time and witness to seizure of two pay-in-slips as per Exs.P21 and P22.
PW35-Vijayalakshmi siezer mahazar witness and turns hostile.
PW36-S.Nagaraja, Assistant Manager, WOC Branch, SBM, seizure mahazar witness to Ex.P96.
PW37-K.V.S.Acharya, Branch Manager, SBI, Tyagarajanagar, Bangalore, seizure witness to Ex.P97.
PW38-Kalyani is the wife of CW41 and seizure mahazar witness, turns hostile.
PW39-S.Lakshminarayan, Office Assistant working in Private company where Accused 8 was one of the Directors and turns hostile.
PW40-Akkam Bhadrapa, Chief Manager (P&S) SBM, Bangalore, provides information about the transaction of Shyamprasad Badekila, as per Exs.P100-113.
PW41-V. Ashok Kumar is the Investigating officer, who has registered FIR as per Ex.P114 against the accused persons, obtained court order to search residence and office of A1 to 3, seized documents and articles from the house and office of accused Nos. 1 to 3 as per Exs.P115,116, 117,123, 118, 119,124,120,121, 122 and 125. He arrested the accused 1 to 3 on 6.2.1996, accused No.4 on 8.2.1996, accused No.5 on 10.2.1996, accused No.6 on 11.2.1996, accused No.9 and 10 on 11.2.1996, accused No.7 on 14.2.1996. He also seized the documents from accused Nos. 5 and 7 as per Ex.P138, 139, 163. He also recovered amounts on the basis of the statements of accused as per Exs.P133,142,143 and 156 and speaks regarding the statements recorded.
PW42-M. Rangaswamy, is the constable ACB, CBI who has verified the addresses of four persons and submitted a report as per Ex.P215.
PW43-P.K.Ramachandran has conducted the investigation in part and recovered money.
PW44-Ramakrishna Inspector, ACB, CBI took up further investigation, obtained sanction orders against the accused who are the public servants and submitted the chargesheet.
PW45-C. Ponnalagan, Inspector ACB CBI has recorded the statement of witnesses and collected Exs.P85 and P86.
PW46- H.G. Parshi, I ACMM, Bangalore at the relevant time, recorded statements of accused Nos. 9 and 10 under Section 164 Cr.PC, as per Ex.P217 and 218.
The claim of the complainant/CBI is that the persons from Income Tax Department are those who were entrusted with the powers in connection with the recovery of arrears of tax. It is stated that said accused/Public servants by misusing and abusing their official position committed offence punishable under Sections 7 and 13(2) read with Section 13(1)(d) of the Prevention of Corruption Act, along with the offences punishable under Indian Penal Code.
Ex.P12, is the proclamation of sale notifying of the auction sale on 20.10.1995 at 11 a.m. [but the auction was conducted on 30.10.1995 at Room No.115, Hotel Krishna Continental]. Even Ex.D17 is also a copy of the said notice. The arrears of Income Tax that was liable to be paid was Rs.7,51,05,327/- (Rupees Seven Crores Fifty One Lakh Five Thousand Three hundred and Twenty Seven Only) by Sri Srikanta Datta Wadiyar and the date of notice is ’20-10-1995’.
Ex.P4 (D-39) is the bidding sheet of auction of property in question conducted on 30-10-1995 at 5.30 p.m. at Mysore. It is as under:
Sl..No. Name of the bidder Bid amount in (Rs.) 1. Shyam Prasad on behalf of Belair Estate Private Limited – Accused No.4 2. Narayanamurthy – Accused No.6 3. B.C. Aswath- Accused No.9 4. Seetharam-Accused No.7 2,01,000/- per acre 2,11,000/- per acre 2,03,000/- per acre 2,04,000/- per acre 2,05,000/- per acre Further, Ex.P21-Challan for payment of Rs.5,00,000/- by accused No.8; Ex.P22-Another challan for Rs.15,90,795/-; Ex.P23-Statement of account; Ex.P24-Account opening form; Ex.P25- Statement of account; Ex.P27(D-2) – Order of attachment of immovable property dated 04.05.1995.
(A) Ex.P30- letter dated 25.09.1995 sent by Chartered accountant;
(B) Ex.P32-34 are the letters of Chartered Accountant.
45. The auction was conducted and completed at Room No.115, Hotel Krishna Continental in Mysore. The property in question i.e. 10 acres of land is situated at Kurubarahalli, near Zoo Garden, Mysore.No bidder can ever saythat at City of Mysore which is well known for World Famous Dasara the value of the land will as stated. However in the subsequent development the auction came to withdrawn as per the orders of the Commissioner of Income Tax.
46. Sri.Srikanta Datta Narasimharaja Wadiyar raised his objections against the auction of the said property through letter dated 23.09.1995 marked as Ex.P14 (Ex.D46) and insisted for withdrawing the auction notice. Sri. Srikanta Datta Narasimharaja Wadiyar also addressed a letter dated 01-10-1996 marked as Ex.P16 and also as Ex.D129 in this connection against the auction of property and also suspecting offence by Income Tax officials and others. Sri Srikanta Datta Wadiyar was also examined as prosecution witness PW.5. A letter is also addressed by him to Sri. Manmohan Singh, the then Minister for Finance, Government of India, as per Ex.P17 on 27-09-1995.
The rest of the documents are regarding conducting of auction of the property comprised in Survey No.4 to the extent of 10 acres at of Kurubarahalli, near Zoo Garden, Mysore City. The further claim of the prosecution is that the accused persons ensured that PW-5 who was the owner of the property in question, was kept in darkness and away from the activities.
47. Involvement of the accused is said to be both active and tacit deeds to ensure that the valuable land is undervalued to the maximum extent and sold in the said auction dated 30.10.1995 for a meager amount of Rs.21,00,000/- and get crores of rupees from rest of the value of the property.
The formality of auction sale was completed and the security deposit was paid on the date of auction itself.
It is also the claim of the prosecution that the very conducting of the auction is claimed to be the main offence and the main witness for proving the conducting of auction dated:30.10.1995 is the ‘auction’ itself.
48. From the nature of offence and its commission, it is seen that accused committed the acts for gain with scant respect to economic structure of the nation. Thus when the ill-gotten wealth obtained by the wrongdoer is recovered or when the efforts of offender to reap the ill-gotten wealth is thwarted and subverted.
49. At this stage it is necessary to make a mention regarding the following.
(1) PW-5 Sri Srikanta Datta Narasimharaja Wadiyar owed arrears of income tax of Rs.7,51,05,327/- payable to I.T.Department.
(2) The income tax officials or the accused have decided to auction the property in question through public auction.
(3) PW-5 Sri Srikanta Datta Narasimharaja Wadiyar was the undisputed owner of the landed property to the extent of 10 acres in Sy.No.4, at Kurubarahalli near Zoo, Mysore. On 30.10.1995, the public auction was conducted in respect of the property in question wherein accused No.4 participated and the bidding details including the highest bidder are as stated above.
50. The auction proceedings are said to have been conducted at Room No.115, Hotel Krishna Continental, Mysore. PW5- Sri. Srikanta Datta Narasimharaja Wadiyar was absent during the auction. Later he has complained how the said auction was mixed with illegality, biased and serious crimes committed and made complaints to various authorities. Recovery of arrears of tax was stayed in W.P.No.19404/1992.
Further, when the property belongs to a third party, in the instant case (PW5), no matter any amount of members who are private can conclude a proceedings to sell a property of third person in a public auction unless the officials concerned like the public servants/accused connive and conspire with the private individuals.. A strong and strongly intended action by the concerned officials only can make the public auction like the present one. The accused/IT officials were only the custodians of relevant records and also were connected with the tax recovery.
51. The guideline value of the property as spoken by PW14- Sri. Kadaraiah, Sub-Registrar, Kengeri, with Ex.P37 is Rs.10 to 12 lakhs per acre. Mysore City is not an abandoned village. The value of the property that too near Zoo Garden cannot be a matter for throw away price otherwise than the natural under circumstance. Things speak by themselves, in the sense: 10 acres of land beside or within the vicinity of zoo garden, Mysore sold in a public auction at the rate of Rs.2,10,000/- per acre with a reserve price of Rs.2,00,000/- per acre. The cause being non payment of tax including the arrears of Rs.7,51,05,327/- speak volumes by themselves. Basically, fixing the value at Rs.2,00,000/- per acre and being accepted at Rs.21,00,000/- for 10 acres is a mockery of the proceedings like public auction. The location of property in question is said to be a residential area.
52. Whenever auction is conducted, more particularly, because of failure to pay arrears of tax tells a lot about maintaining reserve price. Incidentally, the reserve price quoted is, Rs.2,00,000/-per acre. Further, the auction was conducted and concluded under suspicious circumstances.
53. The auction date was changed to 30-10-1995 from 20.10.1995 by accused No.1-Shivanna. There is no document of issuance of notice to PW5- Sri Srikanta Datta Wadiyar. On the other hand, notice is stated to have been communicated through ‘tom tom’.
Service by ‘tom tom’ is notifying the name of the defaulter, the amount of arrears, date of public auction and the land, extent and survey number. The communication of notice would be by a person who will be beating drums and attracting people through such beatings and would be shouting about the details stated above in the local language. It was followed mainly villages during the earlier days. But not and never in the urban sector, more particularly, in a City like Mysore. No document regarding issuance of notice through paper publication or any acceptable mode is placed on record.
The venue selected for auction is ‘Room No.115, Hotel Krishna Continental, Mysore’ under the supervision of accused No.1-Shivanna. Thereafter, the Sale Certificate was issued and accused No.4 was the instrumental for the same. Accused No.8-
Jagadeep Thadani, represented by late Shyamprasad Badekila is the successful bidder.
54. The documents evidencing the date and conducting of auction is Ex.P12, The Sale Certificate Ex.P59 was released by accused No.1 on 11-12-1995. The participants (bidders) are said to be four in number and the main beneficiary projected as highest bidder is accused No.8 and no concrete details are forthcoming regarding the effective participation of the other three accused persons. No mention of statement of offers. No reliable whisper regarding Earnest Money Deposit (EMD) and there is no transparency. The job of accused No.8 was made a mere walk over. The other three accused persons did their part of might to ensure the accused No.8 becomes the highest bidder.
55. Insofar as, the value of the property as spoken by PW-14 Sub-Registrar, Kengeri, on the basis of guideline value is concerned, it is Rs.10 to 12 lakhs per acre. In this connection, judicial note of the city of Mysore, land mark of the property as it is situated near Zoo Garden, Mysore, prevailing market rates at that time as submitted by SPP are taken into consideration. The conducting of the auction of 10 acres of landed property at Mysore at Rs.2,10,000/- per acre, cannot be considered as happened because of good reasons.
PW5- Sri.Srikanta Datta Narasimharaja Wadiyar, states in his evidence that each acre of the property sold under auction worth Rs.30 to 40 lakh in the city of Mysore.
56. It was a platform wherein report was illegally prepared and approval was given by PW.32-Usha Govindan without verification.
Firstly, it was casual conducting of the public auction with utmost haste and there was no proper publicity regarding the holding of auction. Mysore city was the former Capital which later came to be known as Karnataka with the capital as ‘Bengaluru’.
The reserve price of Rs.2,00,000/- per acre fixed is nothing but mockery of honesty itself and finally being sold at Rs.21,00,000/- at Rs.2,10,000/- per acre is nothing less than disgrace and height of mockery of integrity.
57. The reserve price in an auction sale is its indicator and Rs.2,00,000/- per acre fixed would itself makes the intentions clear. There is no transparency nor trustworthy acts, conceivable transaction, fair representation, minimum faithful discharge of public duties and the interest of a citizen was treated as a volleyball, tossed cunningly and smashed mercilessly.
The auction proceeding of 30-10-1995 is nothing but a match that was fixed. Further noticeable fact is that, PW5, the owner of the said property had filed a Writ Petition in W.P.No.19404/1992 wherein there was a Stay against recovery.
58. Insofar as the accused persons 2 to 4 are concerned, they are public servants and prosecution of whom can be made only after obtaining proper sanction from the competent authority. In this connection, the sanction orders obtained for prosecuting accused Nos. 2 to 4 are as under:
Accused No., name of the accused and designation Accused No.1 – Shivanna – Tax Recovery Officer Accused No.2 C.Subbarayan – IT Inspector Marked as Sanction order date and issued by whom Ex.P78 28.10.1998 – Commissioner of Income Tax, Karnataka I, Bengaluru Ex.P79 28.10.1998 – Commissioner of Income Tax, Karnataka I,
Commissioner of Income Tax, Mysore Range, Mysore 59. Insofar as accused No.1-Shivanna –Tax Recovery Officer is concerned, he died during the trial and trial against him is abated.
The charges leveled against the accused persons include criminal conspiracy and under Sections 120B, 420,468,471 IPC and under Sections 7, 13(2) read with Section 13(1)(d) of PC Act and here it is necessary to extract the said sections which read as under:
Section 120B 1 120B. Punishment of criminal conspiracy.— (1) Whoever is a party to a criminal conspiracy to commit an offence punishable with death, 2[imprisonment for life] or rigorous imprisonment for a term of two years or upwards, shall, where no express provision is made in this Code for the punishment of such a conspiracy, be punished in the same manner as if he had abetted such offence.
(2) Whoever is a party to a criminal conspiracy other than a criminal conspiracy to commit an offence punishable as aforesaid shall be punished with imprisonment of either description for a term not exceeding six months, or with fine or with both.] Section 420 420. Cheating and dishonestly inducing delivery of property.—Whoever cheats and thereby dishonestly induces the person de-ceived to deliver any property to any person, or to make, alter 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, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine.
Section 468 468. Forgery for purpose of cheating.— Whoever commits forgery, intending that the 1[document or electronic record forged] shall be used for the purpose of cheating, shall be punished with imprisonment of either de-scription for a term which may extend to seven years, and shall also be liable to fine.
Section 471 471. Using as genuine a forged 1[document or electronic record].—Whoever fraudulently or dishonestly uses as genuine any 1[document or electronic record] which he knows or has reason to believe to be a forged 1[document or electronic record], shall be punished in the same manner as if he had forged such 1[document or electronic record].
Section 7 of The Prevention of Corruption Act, 1988 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 disfavour 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 be not less than six months but which may extend to five years and shall also be liable to fine.
(Explanations) — (a) “Expecting to be a public servant”. If a person not expecting to be in office obtains a gratification by deceiving others into a belief that he is about to be in office, and that he will then serve them, he may be guilty of cheating, but he is not guilty of the offence defined in this section.
(b) “Gratification”. The word “gratification” is not restricted to pecuniary gratifications or to gratifications estimable in money.
(c) “Legal remuneration”. The words “legal remuneration” are not restricted to remuneration which a public servant can lawfully demand, but include all remuneration which he is permitted by the Government or the organisation, which he serves, to accept.
(d) “A motive or reward for doing”. A person who receives a gratification as a motive or reward for doing what he does not intend or is not in a position to do, or has not done, comes within this expression.
(e) Where a public servant induces a person erroneously to believe that his influence with the Government has obtained a title for that person and thus induces that person to give the public servant, money or any other gratification as a reward for this service, the public servant has committed an offence under this section.
Section 13(2) in the Prevention of Corruption Act, 1988 (2) Any public servant who commits criminal misconduct shall be punishable with imprisonment for a term which shall be not less than one year but which may extend to seven years and shall also be liable to fine.
Read with Section 13(1) d in The Prevention of Corruption Act, 1988 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; or (iii) while holding office as a public servant, obtains for any person any valuable thing or pecuniary advantage without any public interest; or In these cases, the concept of ‘Criminal conspiracy’ among the public servant/accused and non public servant/accused interse has to be established.
In this connection, the auction dated 30-10-1995 invariably should have been preplanned act with the intention of making wrongful gain and that has to be established by the prosecution.
60. In this connection, some of the activities of the accused are unrealistic and unreasonable and a cursory glance of the following is necessary:
(i) The notice was not properly issued changing of the date of auction is biased and condemnable.
(ii) The date of auction of property was originally scheduled to be conducted on 20.09.1995. But accused No.1 in his wisdom postpones it to 30-10-1995. The communication of notice is not through paper publication. Regard being had to the fact that, Mysore is a city and the property is near Zoo Garden.
(iii) Necessary arrangement made in the form of pay order No.848670/5600020009 dated:30.10.1995 of State Bank of Mysore, Bangalore, for Rs.5,00,000/-(Five Lakh Rupees only) was collected from accused No.8 along with Rs.30,000/- as cash towards 25% of the final amount.
(iv) Three other bidders were stated to have coordinated in the case to commit criminal acts. The buying of pay order of Rs.5,00,000/- could not have been possible after 5.00 p.m.
61. PW32-Usha Govindan speaks about the approval of reserve price of Rs.2,00,000/- per acre that was proposed and recommended by accused No.1. In this connection, it is necessary to know that the details of the property with reference to topography, demand, value of the similar property per acre or gunta being sold in the vicinity were not placed before PW.32. A person who does not know about the nature and kind of utility of the property has approved the proposal dated 21.08.1995 i.e., PW.32. Expectation and confidence kept upon public servant is misused and abused to the core.
62. The acts in conducting the public auction when considered on face may not reveal the value of the property which was easily worth Rs.30 to 40 lakhs per acre. In this connection, PW5- Srikanta Datta Narasimharaja Wadiyar, owner of the property, PW9- District Registrar and Deputy Commissioner, Mysore, PW14 – Sub-Registrar, Mysore North Taluk, have spoken regarding the guideline value of the property and their credit worthiness in principle is not impeaching.
63. The purchaser of the property is Accused No.8, bought the property for Rs.21,00,000/-. But dissemination of public interest was made by fixing Reserve price at Rs.2,00,000/- per acre and sale consideration of Rs.21,00,000/-.
64. Normally, whenever a public auction is conducted, particularly to sell the property by the Governmental or quasi governmental sector, auctioneer retains the power of rejecting the highest bid, when the bid amount offered is unreasonably low. It is in this back ground, reserve price is maintained as the one that is maintained to prevent prejudice.
65. As a result, the amount of reserve price would be maintained beyond the required amount which also shall be realistic and reasonable. When the reserve price is more and bid that enables the auctioneer to deny the bid even though, it may be a highest bid, but less than the reserve price as “a man cannot be very liberal in spending the money of others”.
Accused No.6- Narayanamurthy, Accused No.9- B.C.Aswath, Accused No.10- M.D.Bheema Naidu, said to be the bidders who participated in the auction to facilitate the accused No.8 and he is being made as the highest bidder.
66. It is also necessary to mention that, PW4- B.N.Mohan has spoken about accused No.4 not availing of RH inspite of permission but attended the auction. Thus, the incriminating material against him gets further strengthened. It is also stated that there was also stay order against the sale of property of PW5- Sri Srikanta Datta Narasimharaja Wadiyar and he has brought the same to the notice of the Department. Accused No.5 –Narasimhamurthy has worked as driver in the department. Accused No.5 went to Mysore on the date of auction. Thus, the presence of Accused Nos.4 and 5 becomes the matter that cannot be considered lightly. In this connection, Ex.P18-Attendance register from August 1993 to July 1995 supports the observation made above. Presence of accused No.5 at Mysore is revealed by PW10- M.Chandrashekar. Recovery of Ex.P21 and P22 – Pay- in-slips and representation given by PW5- Sri Srikanta Datta Narasimharaja Wadiyar to PW1- C.V.Padmanabhan, Commissioner of Income tax further fortifies the conducting of the auction. PW35- Smt.Vijayalakshmi, PW38-Kalyani and PW39- Lakshminarayan, seizure mahazar witnesses turned hostile to the prosecution case. But it is necessary to observe that Accused No.5 is the husband of Vijayalakshmi’s aunt. In addition, Vijayalakshmi is the daughter of PW16-Narasamma. She further speaks about the recovery of Rs.80,000/- from accused No.5. Similarly other recoveries are under ExP-96 dated:6.2.1996, ExP-133 dated:8.2.1994, ExP-142 & 143 dated:10.02.1996 and ExP-156 dated: 11.02.1996. The amount so recovered may not be considered as a conclusive proof of corruption or scandal. But the circumstances that tell about the reality cannot be ignored, though the recovery of money itself is not a conclusive proof.
67. Evidence of Seizure Mahazar witness- PW36- S.Nagaraja –Bank Manager is not controverted. The same principle applies to recovery of jewels. The circumstances are so strong and against the public servants, accused persons that they are in undefendable position and the very way of conducting the auction is res ipsa equator.
PW17-Karpagam is none other than the wife of accused No.2, who produced Rs.50,000/-(Rs.500 x 100) under mahazar Ex.P73.
PW13-Dhanaraj-Pawn Broker tells about deposit of Rs.70,000/- by Accused No.1-Shivanna.
68. Insofar as the total number of accused are concerned, they are 10 in number as on the date of filing the chargesheet. Accused No.1 –Shivanna was a Tax Recovery Officer. It is claimed that the conspiracy was found at the instance of accused No.2- C. Subbarayan who played instrumental growth for the scandal. Accused No.2-C.Subbarayan is Tax Recovery Inspector, subordinate to accused No.1- Shivanna. It is stated that the accused No.2-C. Subbarayan, was also party to the conspiracy and contributed his mind for the commission of the offence. Accused No.3-K. Ramanna, Upper Division Clerk. Accused No.4-B.N.Rajanna working as Upper Division Clerk. Accused No.5-Narasimhamurthy is a car driver. Accused No.6-Narayanamurthy private consultant. Accused No.7-R.S.Sethuraman. is a private party. Accused No.8- Jagadeep R. Tadani, NRI, Director of M/s Belair Estates Private Limited is said to be a bidder who participated in the auction. Accused No.9-B.C. Aswath is stated to be a collusive or dummy bidder and a private person. Accused No.10-M.D. Bheema Naidu is also stated to be a bidder.
69. Among the said accused persons, accused No.1- Shivanna, Tax Recovery Officer, is reported to be dead prior to framing of charge. Accused No.3-K.Ramanna is also reported dead.
Accused No.4-B.N.Rajanna is a upper Division Clerk in the Income Tax Department and accused No.5-A. Narasimhamurthy who is said to be a driver died prior to judgment in the trial court.
70. The claim of the prosecution is that the accused persons formed an unholly syndicate that was designed to make illegal monetary returns of considerable amount in the guise of official act of Income Tax Department which comes under Government of India. The situation exploited by the accused persons is said to be the following.
i) Sri.Srikanta Datta Narasimharaja Wadiyar, the lineal descendant of erstwhile Maharaja of Mysore, was a defaulter in payment of Tax to Income Tax Department to the extent of Rs. 7,51,05,327/-;
ii) He was the owner of land to the extent 10 acres at Mysore in Karnataka, the city which is known for World famous Dasara feast.
iii) The said land is stated to be worth crores of rupees by virtue of its location, near Zoo Garden at Mysore.
iv) It is alleged that accused persons consisting of Public servants and Private individuals entered into conspiracy to make unlawful gains through a make believe public auction to sell the said land for a throw away price and to appropriate the proceeds of the auction proceedings.
Prosecution’s further claim is that proceedings were drawn, notes prepared, reports were made ready, falsities were pumped in through submissions and other mode to ensure the public auction was held on 30.10.1995 in a hotel room at Mysore.
The notification was preceded by successful attempts to prevent wide publications to ensure that only hand picked persons participate in the auction.
71. The reserve price was a mockery that was being fixed at Rs.2,00,000/- per acre and ultimately the land of 10 acres was sold for Rs.21,00,000/- and accused No.8 was declared successful. The other bidders who were collusive and namesake were eliminated as per the plan designed by the accused.
The total arrears payable by the said Srikanta Datta Narasimharaja Wadiyar was Rs.7,51,05,327/- (Seven Crore Fifty One Lakh Five Thousand and Three Hundred and Thirty Seven Rupees Only) and the amount received from the sale of the said property is Rs.21,00,000/- and the said amount is less than 3% and balance of Rs.7,51,05,327/- which is more than 97% remains to be recovered.
72. Another significant factor is that, the prosecution claims that conspiracy for committing the offence was to cause loss to the Income Tax Department, may be on the premise that substantial recovery or in full in all probabilities to the Income Tax Department was prevented.
73. The reality is that the Income Tax Department in such a case will not be forfeiting the right of recovery of the balance. Thus Income Tax Department cannot be branded as victim. But insofar as Sri Srikanta Datta Wadiyar is concerned he is examined as PW-5, and he is the owner of the said property of 10 acres at Mysore, and when his said property is sold for Rs.21 lakh only less than 3% of the liability is satisfied, he still remains liable for payment of more than 97%.
74. It is necessary to mention that if, cheating, forgery or dishonest act, wrongful gain need not be confined to a particular individual or individuals or body or bodies. Culpability lies in the offence and the offender, as an offence reflects the relationship between the offender and the offence which covers his object, intention and the gravity of the offence. Thus, whether it is Income Tax Department or Srikanta Datta Narasimharaja Wadiyar it does not make difference.
75. It is not uncommon that whenever circumstances, incidents and the documents creating or destroying or extinguishing the rights, possessing or dispossessing the material resources may turn out to be an offence by themselves, as such, if happening of the incident or the circumstances is established, probability or the probative force is to conclude the commission of offence.
76. In the circumstances of the case, the very happening or conducting of public auction itself is sufficient to hold that the participants irrespective of their ranks and stance unless there are grounds to presume that they are part of the auction and happened as a co incidence. Preparing a platform for the auction in the form of preparing reports, placing proposals, to convince the decision makers, obtaining the permission for public auction wherein there are no transparent acts regarding the issuance of notices to public in general and PW5-Srikanta Datta Narasimharaja Wadiyar who is the owner of the said 10 acres of land in particular, arranging the public auction in Room No.115, Hotel Krishna Continental, at Mysore, to ensure that the unwanted persons to the participants and organizers are eliminated at the main gate or door by denying permission for the entry into the hotel. In this connection, auction proceedings Ex.P4 depict the participants who were four in number wherein ultimately held accused No. 8 to be the highest bidder.
77. The said auction did happen and concluded with the active plan and participation of accused persons. The conclusion that can be drawn regarding the conclusion of auction and its tainted nature and evidence are:
(i) The oral evidence of PW1 and PW2 who are C.V. Padmanabhan and Selvaraj, respectively regarding conducting of public auction on 30.10.1995 and the presence of accused No.1,2,3,4, 10 and PW31 in Room No.115 at Hotel Krishna Continental at Mysore:
(ii) The following documents marked as Exhibits:
(1) Proclamation of sale Ex.P2(a) (2) Letter dated 6.3.1966 Ex.P2 (d) (3) Carbon copy of the notice Ex.P27;
(4) Letter dated 5.7.1995 Ex.P28;
(5) Letter dated 17.7.1995 – Ex.P29;
(6) Reply to the proclamations Ex.P30 (7) Payment of bid amount by accused No.8 copy of the auction produced Ex.P9.. showing bidding and accepting the highest bid.
(8) Sale certificate file: Ex.P59;
(9) Covering letter… Ex.P59)a) (10) Carbon copy of the mahazar Ex.P60;
(11) Bank drafts and other exhibits:
78. When conducting of public auction on 30.10.1995 is established, it automatically exposes the accused persons. Nature and circumstances of the case is that, it does not get diluted because of the hostility of the witnesses and irregular procedure provided the public auction dated 30.10.1995 is established.
79. It is not a question of demand and receipt of valuable directly or indirectly to constitute offence under the Prevention of Corruption Act , 1988. On the otherhand, when a public servant abuses the office which he is holding and makes it a platform to gain cash or valuable or concession in consideration, and does illegal acts or omits to carry out legal acts and thus commits offence or allow the commission of offence right under his nose to make himself richer.
80. In this regard, learned Special Public Prosecutor for respondent, relies on the following decisions:
(2017)15 Supreme Court Cases 560 - State through Central Bureau of Investigation vs Anup Kumar Srivastava - Head note B is as under:
B. Criminal Procedure Code, 1973 – Ss.227, 228 and 240 – Framing of charge – Duty of courts pertaining to – Framing of charge is first major step in criminal trial where court is expected to apply its mind to evidence placed before it and consider possibility of discharging accused or requiring him to face trial – At stage of framing of charge, trial court is not to examine and assess in detail material produced by prosecution nor to consider sufficiency of material to establish offence alleged – Accused may be discharged where court on basis of evidence placed before it finds that no offence is made out or there is legal bar to prosecution or where there exists no ground to proceed against accused or where matter is so predominantly civil in nature that it leaves n o scope for element of criminality nor does it satisfy ingredients of criminal offence with which accused is charged – On other hand, where court finds that there is ground for presuming that accused has committed offence, it shall frame charge – Presumption is not presumption of law as such – Satisfaction of court regarding existence of constituents of offence and facts leading to tat offence is sine qua non for exercise of such jurisdiction which may even be weaker than a prima facie case.
(2015)2 Supreme Court Cases 553 – Vinayak Narayan Deosthali vs Central Bureau of Investigation – Para 15 & 16 are as under:
15. xxxxx xxxxx The Special Court thus rightly held the charge to be proved. It was not necessary to prove that the accused had derived any benefit or caused any loss to the Bank. The fact remains that action of the appellant involved unauthorized conversion of public funds to private funds of an individual. Issuing of bank receipts fro securities without existence of securities could not be justified except for illegal benefit to a private individual. Patent illegality cannot be defended in the name of practice or direction of higher authorities. Mens rea is established from the fact that false bank receipts were issued for non-existent securities.
16. Thus, the offences of conspiracy, forgery, misappropriation and corruption stand established. It is not necessary to discuss the ingredients of the said offences in detail as the matter has been gone into earlier by this Court in respect of the appellant himself in the reported judgment in Ram Narayan Popli. We may only quote the conclusions arrived at in the said case:
“About the offence of conspiracy.”
356. After referring to some judgment of the United States Supreme Court and of this Court in Yash Pal Mittal v.State of Punjab2 and Ajay Aggarwal; v Union of India3 the Court in State of Maharashtra v. Somnath Thapa4 summarised the position of law and the requirements to establish the charge of conspiracy, as under:(SCC p. 668, para 24) ’24. The aforesaid decisions, weighty as they are, lead us to conclude that to establish a charge of conspiracy knowledge about indulgence in either an illegal act or a legal act by illegal means is necessary. In some cases, intent of unlawful use being made of the goods or services in question may be inferred from the knowledge itself. This apart, the prosecution has not to establish that a particular unlawful use was intended, so long as the goods or service in question could be put to any lawful. Finally, when the ultimate offence consists of a chain of actions, it would not be necessary for the prosecution to establish, to bring home the charge of conspiracy, that each of the conspirators had the knowledge of what the collaborator would do, so long as it is known that the collaborator would put the goods or service to an unlawful use.’ 81. Thus, it goes without saying, even in case of no demand and acceptance of bribe, any profit or income is being made individually, or in association with others wherein a platform is laid, an occasion is created, proceedings are made and kickbacks are received and stronger position are achieved, without any efforts but through subverting the discretion and powers through corrupt means are more serious offence under Prevention of Corruption Act, 1988 in general and Sections 7 and 13(2) of the said Act in particular. This applies to all the public servant/accused in this case. The very act of arranging the auction dated 30.10.1995 itself was a trap to cover legality and practice illegality for monetary benefit.
82. The very fact of conducting the public auction at Hotel Krishna Continental, Mysore, at 5.00 p.m. tells a lot about the dishonesty and disloyalty of the public servants/accused their foreknowledge about the ill- gotten wealth and desire to have it. Even there are irregularity regarding search, recovery of money concerned, it does not absolve the accused of the criminal liability, even action of accused in conducting the public auction on 30.10.1995 by itself is sufficient to hold the accused criminally liable. Further the enabling deeds and acts are in the form of reports, proceedings recommendation for auction dated 30.10.1995. The accused persons consisting of public servants businessman, middleman participation are seriously instrumental in bringing the public auction dated 30.10.1995 from the stage of conspiracy to reality and PW5-Srikanta Datta Narasimharaja Wadiyar was victimized.
83. Further aspect is, insofar as accused Nos.6,8, 9 and 10 bidders are concerned, the unsuccessful bidders are Accused Nos. 6,9, and 10 and successful bidder is accused No.8. At the cost of repetition, invariably it is established that offence would not have been complete without bidders. In the circumstances, they cannot claim that they have formally participated in the auction and that they had no intention to cheat anybody. It is proved beyond doubt that, bidders/accused 6,9 and 10 participated in public auction, wherein only four persons were knowing about the auction and next one being accused No.8, the successful bidder. The way in which, proceedings are held and participation of the bidders Accused Nos.6,9 and 10, it is to be noted that accused No. 8 would not have been projected as highest bidder unless the way was paved by the said accused Nos. 6,9 and 10.
It is also necessary to place on record that, their participation in Hotel Krishna Continental on the date and time of auction has nothing to do with good faith.
84. In the nature and circumstances of the case, without the participation of all the accused with their mutual understanding and signals in a nutshell, without the criminal conspiracy among all the accused the offences charged against them could not have been done. There are offences like murder, simple hurt, grievous hurt, attempt to murder may in certain cases are committed in a fit of rage or in exercise of right of private defense. But cheating, forgery, criminal conspiracy, corruption etc cannot be claimed to have been committed in exercise of right of private defense or in a fit of rage.
85. Criminal liability is some kind of relationship that exists between crime and the Criminal. If such relationship does not exist between a person and the crime it is quite but natural that such person may not be liable among various classification of offence and kinds of offence from criminal trespass to murder, and such offence may have peculiar mitigating element.
86. Accused No.6/appellant in Criminal Appeal No.928/2010 is said to be a close associate of Accused No.4 – B.N.Rajanna. He is a bidder, who offered Rs.2,03,000/- per acre as per Ex.P3. Insofar as accused No.7/appellant in Criminal Appeal No.961/2010 is concerned he is the middleman, who liaisoned accused No.8. The evidence regarding his participation in the proceedings and liaisoning accused No.8 suggests that invariably, he had the same intention and did the acts to complete the offence.
Moreover, he is liable to the same extent for which the accused No.8 is liable. Therefore, the submissions regarding bonafide bidding by accused Nos. 6,9, and 10 can never be believed for the reasons stated above. On the other hand, they are very much instrumental in commission of the offences. In the circumstances, his antecedents if good cannot be of any avail to him.
87. On marshalling the complaint, investigation papers, statements, evidence of prime witnesses suggests the offences happened and it is established beyond all reasonable doubt.
88. As explained above, the platform for commission of the offences punishable under Sections 120B, 420, 468, 471 of IPC and Sections 7, 13(2) read with 13(1)(d) of Prevention of Corruption Act, 1988 was made and clearly trap was laid, it is not through question of demand and acceptance, but it is totally through using certain facts from official files, then unlawfully and dishonestly creating opportunity for making ill-gotten money clearly suggest regarding the ingredients of committing the above offences.
89. The idea of bringing 10 acres of land into public auction into reality and conducting the same on 30.10.1995 at Hotel Krishna Continental at Mysore at 5.00 p.m. itself is commencement of the scandal and creating of the platform that was undoubtedly vulnerable for committing the offences. The proposing of Rs.2,00,000/- per acre as reserve price in respect of the land and property of 10 acres in Survey No.4 of Kurubarahalli, near Zoo Garden, Mysore, is a dubious, incorrigible and a well planned evil act, besides punishable.
90. The presence of accused persons therein and their participation and carrying out their role, be it as driver, clerk, Income Tax Inspector and the private persons or middlemen, bidders whether successful or otherwise are all equally liable for their acts.
91. Insofar as accused No.8 is concerned, he is the highest bidder at Rs.2,10,000/- per acre in the said auction. He is the Team leader wherein the auction of the land was went smoothly and results are achieved as per plan. The public auction dated 30.10.1995 in respect of 10 acres of land in Survey No.4 of Kurubarahalli, Near Zoo Garden, Mysore, is nothing but a match which was played after the result was decided as it was fixed. Considering acts of the accused stated and discussed above, they have committed the offences punishable under Sections 120B, 420, 468, 471 of IPC and Sections 7, 13(2) read with Section 13(1)(d) of Prevention of Corruption Act, 1988.
92. This is an ideal case to show conspiracy is hatched, system itself is cheated, misuse of laws is effected and white colored crime is committed, wherein all the accused persons are equally liable for the offences. However, Prevention of Corruption Act is added for the offence Punishable under Sections 7 and 13(2) read with 13(1)(d) of Prevention of Corruption Act 93. The prosecution has proved the commission of offences by the accused beyond all reasonable doubt and thus the accused are liable for punishment.
94. The learned Special Judge was right in convicting the accused for the offences punishable under Sections 120B, 420, 468,471 of IPC and Sections 7, 13(2) read with Section 13(1)(d) of Prevention of Corruption Act, 1988 as mentioned above in the table and sentencing them for the same.
In the process, the Judgment dated 30.08.2010 passed by the learned XXI Additional City Civil and Sessions Judge and Special Judge for CBI Cases, Bangalore, in Special C.C.No.134/1998 convicting the accused/appellants for the offences punishable under Sections 120B, 420, 468, 471 of IPC and Sections 7, 13(2) read with Section 13(1)(d) of the Prevention of Corruption Act, 1988 as stated above and sentencing them are hereby confirmed. The appeals are devoid of merits and accordingly, they are dismissed.
Sd/- JUDGE tsn*/SBN