S.K. KALE Vs. STATE OF MAHARASHTRA

PETITIONER:
S.K. KALE

Vs.

RESPONDENT:
STATE OF MAHARASHTRA

DATE OF JUDGMENT17/12/1976

BENCH:
FAZALALI, SYED MURTAZA
BENCH:
FAZALALI, SYED MURTAZA
BHAGWATI, P.N.

CITATION:
1977 AIR  822          1977 SCR  (2) 533
1977 SCC  (2) 394
CITATOR INFO :
R        1979 SC 826     (20,21)

ACT:
Prevention  of Corruption Act, 1947, s. 5(1)(d),    onus
probandi,  whether to be discharged by the accused.
Constitution of India,  Article 136,  Re-appraisal  of
evidence under,     when called for.

HEADNOTE:
The     appellant was posted as the Local Purchase  Officer
at the Army Ordnance Depot in Poona district.  In connection
with  the purchase of some engineering tools,  charges    were
brought     against him under s. 5(1)(d) read with s.  5(2)  of
the Prevention of Corruption Act, for having procured  pecu-
niary  benefit    for a certain contractor by  corrupt  means,
thereby     causing wrongful loss to the army department.     The
Trial Court convicted the appellant, and in appeal the    High
Court  confirmed the conviction.  The Supreme Court  granted
him Special Leave to appeal under Art. 136 of the  Constitu-
tion, and allowing the appeal,
HELD:  1.  Both the courts below had  proceeded  on     the
footing that it was for the accused to prove the ingredients
of s. 5(1)(d) of the Act.  This approach was wrong.  It     was
for  the prosecution to prove affirmatively that the  appel-
lant by corrupt or illegal means or by abusing his  position
obtained any pecuniary advantage for some other person. [536
C-D]
2.    Normally this Court in special leave against a    con-
current judgment of the High Court and the trial Court    does
not re-appraise the evidence, but here we find that both the
courts    below have drawn wrong inferences from proved  facts
and have made a completely wrong approach to the whole    case
by misplacing the onus of proof which lay on the prosecution
on the accused and presuming that the accused had a  dishon-
est intention.    [536 B-C, H]
Narayanan Nambiar v. State of Kerala [1963] Supp. 2     SCR
724; 730-731, referred to.

JUDGMENT:
CRIMINAL    APPELLATE JURISDICTION: Criminal Appeal     No.
301 of 1971.
(Appeal  by     Special Leave from the Judgment  and  Order
dated  the 15th/l6th June 1971 of the Bombay High  Court  in
Criminal Appeal No. 1405 of 1969).
P.H. Parekh and Miss Manju Jatley, for the appellant..
H.R. Khanna and M.N. Shroff, for respondent.
The Judgment of the Court was delivered by
FAZAL  ALI, J.—Corruption and nepotism is     so  rampant
in   our  society of to-day, and more  particularly  in     the
services,  that     the Indian Penal Code    was  not  considered
sufficient  to meet this menace, and the Prevention of    Cor-
ruption Act, .1947 (Act II of 1947)–hereinafter referred to
as  ‘the  Act’–had to be enacted and amended from  time  to
time  to stamp out this evil.  This is an appeal by  special
leave
534
directed  against  the    judgment of the     Bombay     High  Court
affirming  the conviction of the appellant under s.  5(1)(d)
read with s. 5(2) of the Act and the sentence of six  months
rigorous imprisonment passed by the Special Judge, Bombay.
The  facts of the present case are more or  less  undisputed
and  are  the least complicated and,  therefore,  they    fall
within    a very narrow compass, and by and large we  have  to
examine     whether   or not the inferences drawn by  the    High
Court from the proved facts are legally correct and lead  to
only one hypothesis, namely, that the accused is guilty.
It  may. be necessary to give a resume of the     prosecution
case  before indicating the evidence and  the  circumstances
relied upon by the courts below in convicting the appellant.
The appellant was a senior officer in the Army, holding     the
rank  of  a Major, and was at the material  time  the  local
Purchase Officer, hereinafter to be referred to as LPO,     at
Ordnance  Depot at Talegaon Dabhade,  District Poona.    Fol-
lowing the Chinese attack in 1962 an Emergency was  declared
and  the Army required certain engineering tools to be    sup-
plied    immediately.  The Ordnance Depot, Jabalpur,  sent  a
requisition  of engineering tools to the Ordnance  Depot  at
Talegaon  Dabhade,  Poona.  In this connection    the  Control
Officer     of the Ordnance Depot wrote a letter to  the  Group
Officer     requesting him to despatch the stores    immediately.
The Group Officer consequently wrote a letter to the  appel-
lant  who  was the LPO at the relevant time to    arrange     the
supply of stores immediately. The appellant was directed  to
purchase the stores locally and to deliver them to the Group
Officer.   The    Group Officer also indicated in     his  letter
that the stores requisitioned by him were  not available  at
the Depot at Talegaon. The detailed list of the tools, while
is  at    Ext. 9, was received by the appellant on  March     27,
1963.    On the same day the Chief Ordance Officer passed  an
order enabling the LPO    to immediately purchase the tools on
cash purchase basis.
We might pause for a little while in order to explain     the
nature    of the order passed by the Chief  Ordnance  Officer.
It  appears that the normal procedure in the Department     was
that the LPO had to draw cash and then go to the market     and
purchase  the goods against cash.  But in view of the  Emer-
gency  and the immediate necessity of the tools this  proce-
dure  was waived and the appellant was permitted to buy     the
tools on covering purchase order basis; in other words,     the
appellant could himself purchase the tools without obtaining
the previous sanction of the Chief Ordnance Officer, and  on
receiving  the    bills from the supplier and  processing     the
same could get them sanctioned by the Chief Ordnance Officer
and then make the payment to the supplier. According to     the
prosecution the appellant, a day after he received the list,
Ext. 9, placed orders with Jayantilal Himatlal Shah, P.W. 2,
for supply of the tools.  It is not disputed that P.W. 2 was
one  of the contractors on the approved list of the  Depart-
ment, and still continues to be so.  P.W. 2 further  assured
the  appellant    that he would make the supply  as  early  as
possible, and that .he would do so at moderate rates. P.W. 2
accordingly procured .the articles from Bombay and delivered
the same in the Depot by April 6, 1963 along with his  bills
after which
535
the  bills  were placed before. the Chief  Ordnance  Officer
and   after sanction by him the payment was made to P.W.  2.
Apart  from engineering tools there was another     requisition
for  the supply of 900 dessert spoons.    The appellant  first
wanted    to place this order also with P.W. 2, but  he  found
that  his rate was a little higher than the rate  which     was
tendered to the Department sometime before, and,  therefore,
placed    orders with another firm of M/s     Devichand  Lalchand
Gandhi,     P.W. 11, and received 900 dessert spoons of  stain-
less steel from them.
Sometime in 1964, P.W. 18, an Inspector of Police in the
Office    of Special Police Establishment,   Bombay,  received
some   information regarding the appellant having  committed
an offence punishable under the Act on the basis of which he
recorded  the First Information Report on January 25,  1964.
Thereafter  he obtained the permission of the Special  Judi-
cial Magistrate for investigating the case  and      eventually
submitted  a  chargesheet against the appellant     before     the
Special     Judge,     Bombay, on April 28, 1966 as  a  result  of
which  the appellant was tried, convicted and  sentenced  by
the  Special Judge, and his appeal against the said  convic-
tion and sentence before the High Court failed.
The gravamen of the allegation against the appellant  is
that  although    the supplies were to be made as     quickly  as
possible the appellant made a deliberate departure from     the
normal    procedure  which was adopted in the  Department,  in
that  he followed the procedure of covering  purchase  order
basis  and placed orders with P.W. 2 a,lone  without  making
any  enquiries from the local market whether the tools    were
available there. It was also alleged that by placing  orders
with P.W. 2 the appellant caused P.W. 2 to earn a profit  of
45% and thereby caused wrongful loss to the Army Department.
It was further alleged that a number of firms in Poona    were
prepared  to  supply  the goods required at  a    much  lesser
profit    of  10 to 15 % and the appellant made  no  enquiries
whatsoever from these firms although some of them were    also
on  the     approved list of the Department.  On the  basis  of
these circumstances only the prosecution sought the  convic-
tion  of the  appellant.  The  appellant  pleaded  innocence
and  denied  that he had any intention    to  cause  pecuniary
benefit     to P.W. 2.  The appellant submitted that the  arti-
cles were very urgently required and as no time was left  he
had to act quickly and take immediate decisions.  It was for
this  purpose that the normal procedure was waived  and     the
Chief  Ordnance Officer permitted him to adopt the  covering
purchase  order     system. As regards the enquiries  from     the
local  market,    the definite case of the  appellant  in     his
statement under s. 342 of the Code of Criminal Procedure was
that he had in fact made enquiries from a few firms and     his
enquiries revealed that either the firms did not possess the
goods  themselves or that they were not dealers in  all     the
goods.    He further expressed his ignorance that P.W. 2    made
a profit of 45% and pleaded, on the other hand, that he     was
given  to  understand by P.W. 2 that the articles  would  be
supplied at moderate rates.  The appellant seemed to suggest
that as all  the articles required were not available in the
local  market  he thought it a prudent act to  place  orders
with a person who was in a position  to supply all the tools
required  at one stretch instead of running from one  dealer
to another for purchasing goods piecemeal, and as P.W. 2 was
prepared  to supply all the goods himself and he  was    also
on the 18–1546 SCI/76
536
approved  list    of dealers the appellant  decided  to  place
orders    with him. He made no secret of the fact because     all
the  higher officers, including the Chief Ordnance  Officer,
sanctioned the bills sent by P.W. 2.  The Trial Court, after
consideration  of  the evidence     and   circumstances,  found
that  the appellant had by corrupt means procured  pecuniary
benefit for P.W. 2 and caused wrongful loss.  The High Court
in appeal confirmed the finding of the Trial Court.
Normally  this Court in special leave against  a  concurrent
judgment of the High Court and the Trial Court does not     re-
appraise  the  evidence, but unfortunately in this  case  we
find that both the courts below have drawn wrong  inferences
from proved facts and have made a completely wrong  approach
to the whole case by misplacing the onus of proof which     lay
on  the prosecution on the accused.  Both the  courts  below
had proceeded on the footing that it was for the accused and
not  for  the  prosecution to prove that  the  accused    made
enquiries  from the local market or that he knew  about     the
rates,    etc.   This approach  was obviously  and  manifestly
wrong.    It is plain that it was for the prosecution to prove
the ingredients of s. 5(1) (d), which runs thus:
“5(  1  ) A public servant is  said  to
commit the offence of criminal misconduced.
(a)….
(b)….
(c)….
(d) if lie, by corrupt or illegal means or
by  otherwise abusing his position  as  public
servant, obtains    for himself or for any other
persons any valuable thing or pecuniary advan-
tage  ….  ”
In other words it was for the prosecution to prove  affirma-
tively that the appellant by corrupt or illegal means or  by
abusing     his position obtained any pecuniary  advantage     for
some  other person.  In view of the clear defence  taken  by
the appellant it is obvious that it was for the     prosecution
to  prove  that     the accused made no  enquiries,  that     the
accused     made  a departure from the  normal  procedure    with
oblique motive, and that the accused knew that P.W. 2  would
make a profit of 45 % whereas others would be satisfied with
a  profit of 10-15%. The High Court, to begin with,  started
with  the presumption that the accused    led no    evidence  to
show that he made any enquiries. We might state at the .risk
of  repetition that it was not for the accused to prove     the
prosecution case but it was for the prosecution to  disprove
what the accused said, namely, that he had made      enquiries.
The   prosecution  could prove this fact only  by  producing
satisfactory  and convincing evidence to show that  the     ac-
cused  in fact made no such enquiries and he knew about     the
margin    of  profit which other dealers would have  made.  We
shall  immediately show that there is no legal    evidence  to
prove  this  fact.  What the courts below have    done  is  to
disbelieve  the     case  of the appellant because     he  led  no
evidence  to show that he made any enquiries  regarding     the
availability of goods or the rates, and therefore the courts
presumed that the accused had a dishonest intention.
537
In    the case of Narayanan Nambiar v. State of  Kerala(1)
this  Court  had  the occasion to consider  the     import     and
interpretation    of the words “corrupt or illegal means”     and
the word “abuse”, as mentioned in s. 5 (1) (d).     Tiffs Court
observed thus:
“Let us look at the clause “by otherwise
abusing the position of a public servant”, for
the  argument  mainly  turns  upon  the    said
clause.    The phraseology is  very  comprehen-
sive.  It covers acts done “otherwise” than by
corrupt or illegal means by an officer abusing
his  position.  The gist of the offence  under
this  clause is that a public officer  abusing
his  position as a public servant obtains     for
himself  or for any other person any  valuable
thing or    pecuniary advantage.  “Abuse”  means
mis-use i.e. using his position for  something
for which it is not intended.  That abuse     may
be  by corrupt or illegal means  or  otherwise
than  those means.  The word  ‘otherwise’     has
wide  connotation     and  if  no  limitation  is
placed  on it, the words “corrupt’,  ‘illegal’
and   ‘otherwise’     mentioned  in    the   clause
become surplusage, for on     that    construction
every  abuse  of position is gathered  by     the
clause. So some limitation will have to be put
on  that word and that limitation is  that  it
takes  colour from the preceding    words  along
with  which it appears in the clause, that  is
to say something savouring of dishonest act on
his  part     ……     The juxtaposition   of     the
word  ‘otherwise’ with the words    ”corrupt  or
illegal means” and the dishonesty implicit  in
the word “abuse” indicate the necessity for  a
dishonest     intention on his part to bring     him
within the meaning of the clause?’
We    are  satisfied that the judgment of the     High  Court
runs  counter to the principles laid down by this  Court  in
the case cited above, and the High Court does not appear  to
have  applied  that principle  in deciding the truth of     the
case presented by the prosecution against the appellant.  In
the  instant  case it is not alleged that the  accused     had
used  any corrupt or illegal means.  It has not     been  shown
that  the accused himself accepted any illegal gratification
or pecuniary benefit nor has it been shown that he  violated
any statutory rule  or    order. Thus, even on the prosecution
allegation  the case of the appellant falls only within     the
second    part of s. 5 (1 ) (d), namely, abusing his  position
as  public servant.  The abuse of position, as held by    this
Court,    must  necessarily  be dishonest so that     it  may  be
proved that the     appellant caused deliberately wrongful loss
to the Army by obtaining pecuniary benefit for P.W. 2.
After  having gone through the evidence referred  to  by
the  courts  below we think the     prosecution  has  miserably
failed to prove this fact. To begin with, the first  circum-
stance    relied    upon by the High Court is that    the  accused
made  a     deliberate departure from the    usual  procedure  of
purchasing  against cash. According to the prosecution,     the
procedure  was that the officer should have drawn cash    from
the  office and then he should have gone to the market    ’and
purchased the articles and
(1) [1963] supp. 2 S.C.R. 724, 730-731.
538
after having made the purchases he would obtain the sanction
of the Chief Commanding Officer. This procedure is known  as
“cash  purchase basis”.     The accused, however,    adopted     the
procedure known as “covering purchase order”, i.e., he    made
the  purchases    and got the bills sanctioned  by  the  Chief
Ordnance  Officer.  It is not disputed that in    the  present
case,  in  view     of the emergent  circumstances     the  Chief.
Ordnance  Officer  himself had allowed     the  appellant      to
make  the  purchases on the basis of cash purchase  and     had
himself sanctioned the bills tendered by the supplier,    P.W.
2.   All  the bills were paid to P.W. 2 by cheque.   It     was
contended by the State that in the instant’ ease the  appel-
lant had purchased these articles against cash and later  on
obtained the necessary    covering purchase  orders.  This  is
not  correct because the appellant had merely placed  orders
with  P.W. 2 for supply of goods and it was only  after     all
the goods had been supplied, verified and found correct that
the bills were forwarded to the Chief Commanding Officer for
sanction.  The High Court itself found that Lt. Col. Pun had
passed    an order directing the appellant as LPO to  purchase
all the articles against cash immediately.  In this  connec-
tion the High Court observed as follows:
“Similarly,  it is not in dispute    that
regarding the mode of purchase, Lt. Col.    Purl
had  already  passed an  order  directing     the
appellant     as Local Purchase Officer  to    pur-
chase all the articles against cash immediate-
ly.”
Even  assuming    that the appellant  purchased  the  articles
against     cash he was doing so in compliance with the  orders
of  the Chief Ordnance officer and there was  absolutely  no
reason for the High Court or the Special Judge to have drawn
inferences against the appellant for violation of the proce-
dure  when the highest officer of the Depot  had  sanctioned
the procedure which was adopted by the appellant and had  in
fact  authorised him to do so in view of the Emergency.      It
may  be     necessary to refer to the evidence of P.W.  2,     Lt.
Col.  Des Raj (P.W. 10) who stated that a covering  purchase
order is sanctioned only when the Chief Ordnance Officer  is
satisfied that there are special circumstances which  neces-
sitate    the sanction of the purchase order after the  stores
are  purchased. It is not disputed that the  Chief  Ordnance
Officer     had issued a covering purchase order in this  case.
In these circumstances the best person who would have thrown
a  flood  of light on the subject and whose  evidence  would
have  clinched    the  issue whether or not  the    accused     was
authorised  to    depart from the normal    procedure  was    Col.
Anand,    the Chief Ordnance Officer, who though    examined  by
the Police during investigations was not produced before the
Court.    In  the absence of his evidence there was  no  legal
justification  for  the court to hold that the    accused     had
departed, from the normal procedure without the authority of
the Chief Ordnance Officer, particularly when it is admitted
that a covering purchase order was passed by the said  Offi-
cer  and  the bill was also finally sanctioned by  him.      In
these  circumstances,  therefore, the entire fabric  of     the
reasoning  of  the High Court as also that  of    the  Special
Judge falls to the ground.
Another circumstance on the basis of which the appellant
was  convicted was the fact that he made no  enquiries    from
the local suppliers, nor did he ascertain the rates. On this
question also the High Court, as well as the Special  Judge,
have misplaced the onus on the accused.
539
To  begin with, the accused has categorically stated in     his
statement  under s. 342, Cr.P.C., that he had in  fact    made
enquiries and had sent the Supply Clerk and one Deshmukh for
getting     the  rates  and find out whether  the    stores    were
available.  The prosecution could succeed only in the state-
ment  of the accused could be falsified and this  could     not
only  be  done if the prosecution had  examined     the  Supply
Clerk  who  was sent by the appellant or Deshmukh,  both  of
whom  were   employees    in the Army and     in  possession     and
control     of the prosecution,  and yet none of these  persons
were examined to falsify the statement of the accused.     The
High Court, on the Other hand, was in error when it observed
that  the  accused did not produce  either   the   clerk  or
Deshmukh  forgetting that it was not for the   accused     but
for   the prosecution to prove that what the  appellant     had
said   was  false.  Furthermore, reliance was placed by     the
High  Court and the Special Judge on the evidence  of  P.W.s
14, 15 and 16.    P.W. 14 does state that his firm was dealing
in  engineering tools and other articles and that he was  on
the  list of approved contractors of ,Ordnance    Depot.     He,
however, admitted that out of the articles required only  80
to 90 percent wet available with the firm.  In    cross-exami-
nation,      when asked about a particular type of     engineering
tool  the witness  was unable to state for what     purpose  it
was used.  The witness admitted that he did not maintain any
stock  register at the shop and the fact that  the  articles
were available was being deposed by him merely on the  basis
of his memory.    Finally, the witness admitted thus:
“I  had  not gone to     Talegaon   Ordnance
Depot to enquire whether any engineering tools
were required in the    depot.”
The  High Court seems to think that as this  witness’s    firm
was merely a retailor, therefore there was not necessity  to
keep  a stock register, The witness has nowhere stated    that
he  was     a retailer and not a whole  saler  and,  therefore,
there  was  absolutely no basis for the High Court  to    have
conjectured or speculated on this point in order to raise an
inference against the appellant.  On the other hand, in     the
absence     of any document, register or inventory to show     the
nature    of goods the firm of P.W. 14 was dealing in,  it  is
difficult to accept the ipsi dixit of the witness consisting
of  his bare statement based on pure memory that  the  engi-
neering     tools were available six years before the  date  he
was deposing.  Such evidence, in our opinion, is  absolutely
worthless.  In fact P.W. 18, the Inspector, has deposed that
in  the course of his investigations he had seized  the     ac-
counts and documents of the local firms, and yet no document
was produced by the prosecution to show that P.W. 14 in fact
had  in     his possession engineering goods  at  the  relevant
time.    Furthermore, the witness positively states  that  he
never  went to Talegaon Ordnance Depot    to  enquire  whether
any  tools were required.   It was also not put to the    wit-
ness whether the appellant personally or through one of     his
employees  had    approached him regarding the supply  of     the
goods.    In these circumstances, therefore, how possibly     can
an  inference  be drawn from his evidence that    the  accused
made no enquiries whatsoever when the accused had positively
stated    that he did.  Finally, on the question of  rates  or
margin of profit also, the witness makes
540
only  a verbal statement that he would have  charged  10-15%
which cannot be accepted in the absence of documentary proof
of the fact that the firm had sold these articles during the
relevant  time    to various persons and made   10-15%  profit
only.     It  is     manifest that if the firm was    carrying  on
such a huge  business then everything  must have been  writ-
ten  in     the account books which were in possession  of     the
Inspector  and yet not produced.   In  these  circumstances,
therefore, we are satisfied that the High Court misread     the
evidence of P.W.14.
Reliance was then placed on the evidence of P.W. 15,  Mahen-
drakumar, who is a partner of the firm known as ‘C.  Ambalal
& Co.’    To  begin with, he clearly admits that his firm     was
dealing     in hardware, paints, sanitaryware and    only   files
amongst     the engineering  tools. The witness further  states
that  Out  of the articles mentioned in     the list,   Ex.  9,
only  files,  being items Nos. 75 to 94 and 96    to  99    were
available  with him and could be supplied by him.   He    does
not say that he was in a position to supply the other  engi-
neering     goods also. Again, the witness makes only a  verbal
statement  without any documentary proof that he would    have
charged     10-12%     of profit on the amount spent.     It  may  be
pertinent to note  here that the appellant in his  statement
under  s.  342, has positively asserted that  he   did    make
enquiries from the firm of Ambalal. Ambalal was examined  by
the  police  but not produced in court and  the     explanation
given was that he was ill.  That by itself is not a convinc-
ing explanation because the prosecution could have asked for
adjournment from the court to enable Ambalal to be  examined
as a witness for he alone could have falsified the statement
of the accused whether or not any enquiry was made from him.
Finally, this witness himself states:
“I do not remember whether I was present
when  the     list, Ex. 9, was shown     to  Ambalal
when his    statement  was recorded.”
The  evidence of this witness, therefore, does    not  exclude
the  possibility of the accused having made  enquiries    from
Ambalal and  the accused has in fact explained in his state-
ment  that no orders could have been placed with  this    firm
because     he  was only in a position to    supply    files  which
formed    a  very     small component of  the  engineering  goods
required.   In    these circumstances,  therefore,  the    evi-
dence,    of  P.W. 15 does not falsify the  statement  of     the
accused     that he made enquiries from this firm but,  on     the
other hand, goes to support it. The High Court has  observed
that if the appellant had made enquiries from P.W. 15,    then
he would have undoubtedly remembered this fact. This process
of  reasoning appears to us to be absolutely perverse.    When
the witness himself does not remember whether the  appellant
had  made  any enquiries in his presence  then    the  natural
inference would be that he does not exclude the     possibility
of the appellant having made an enquiry, and in the  absence
of  the     examination of Ambalal it cannot be said  that     the
statement of the accused was false.
The  next evidence on which reliance was placed was of    P.W.
16,  Taharbhai.     This witness clearly admits that he had  no
engineering  goods  in his stock and if an  order  had    been
placed he could     have
541
supplied  them    by procuring them from    somebody  else.      In
these  circumstances he was in the same position as P.W.  2.
This witness further admits that out of the list, Ex.9, only
files  and  drills  were available, but the stock  of  these
articles  was  scanty.    He again orally says that  he  would
have  charged a     profit of  15%.  This    witness admits    that
he  does not remember whether the appellant had come to     his
shop on March 27, 1963 to enquire about the availability  of
the  goods and the rates of engineering tools.    It was    sug-
gested    to  him     that enquiries were made from    him  by     the
appellant  and    he said, that the tools were  not  available
with  his firm.     The evidence of this witness  also  suffers
from the same infirmities as are to be found in the evidence
of P.Ws. 14 and 15.  He has not produced the stock  register
nor any document or accounts or inventories to show that  he
had  all  the goods required.  His statement  further    does
not   exclude    the possibility of the accused    having    made
enquires  from    him,  or at any rate does  not    falsify     the
statement of the accused. As regards  the margin of  profit,
that  is also ipsi dixit without any basis and is  not    sup-
ported by his account books.
It    seems  to us that before a presumption    against     the
accused could be raised that he knew that other firms  would
have  charged  a much lesser profit than P.W.2,     it   should
have  been proved  by the production of account books of the
firms concerned and their dealings during the relevant    time
that they had sold similar of identical goods and made    only
a  profit of 10-15%.  The verbal statement of the  witnesses
regarding  the margin of profit which they would  have    made
had orders been placed six years back can carry no weight.
This  is all the evidence on the basis of  which  infer-
ences  against the appellant have been drawn.  After  having
gone through  the evidence we are satisfied that the  prose-
cution has not produced any reliable or conclusive  material
to  prove that the appellant had any dishonest intention  in
causing     pecuniary benefit  to P.W. 2.    Even  assuming    that
the  accused departed from the normal procedure     in view  of
the urgent necessity of the articles it cannot be said    that
this was done with a corrupt or oblique motive.     The  appel-
lant  had been asked. by the Jabalpur Depot to supply  these
articles  immediately. The appellant, therefore, had t6 take
a  quick  decision and he  was authorised to do     so  by     his
Chief.     Since P.W. 2 was prepared  to supply all the  goods
in  bulk  at one stretch the appellant may have     thought  it
better to place the orders with him.  May be, that this     was
an  error  of judgment or an act of indiscretion,  but    from
that  alone an inference of dishonest intention     cannot      be
drawn.    Moreover, P.W l0 has clearly stated thus:
“I     had no reason to doubt the  honesty
or sincerity of the accused during the  period
he was serving under me.”
This would show that the appellant was really an honest     and
sincere officer and his antecedents were good.    Against this
background we should have expected much better    and superior
evidence  to  justify inference of the accused    having    been
animated  by  a dishonest intention in placing    orders    with
P.W. 2.
542
There  is  yet  one more  intrinsic     circumstance  which
negatives the guilt of the accused.  Although the  appellant
had given orders with respect to all the articles to P.W. 2,
yet  when he found that P.W. 2 was charging higher rate     for
the dessert spoons he did not place orders for the same with
him but placed the orders with P.W. 11, who supplied at     the
rate  of Re. 1/- per spoon which was less than the  rate  at
which  P.W.  2    was ready to supply.  This  shows  that     the
appellant  did    take due care and caution and  did  not     act
blindly. There is absolutely no legal evidence on the record
to  show as to what was the nature of the margin  of  profit
which  the  firms  of P.Ws. 14, 15 and 16 had  made  if     the
orders had been placed with them, and in the absence of such
an evidence the court would not be justified in holding that
the accused abused his position in causing  pecuniary  bene-
fit  to P.W. 2.     The appellant had admitted that if  he     had
known  that P.W. 2 would have charged such a high profit  he
would have been more careful.
On    the other hand, what appears to us to be  most    sur-
prising is that although P.W. 2 was the sole beneficiary  of
the whole transaction and had, according to the prosecution,
made  profit of 45% and was, therefore, in the nature of  an
accomplice,  yet he continues to be on the approved list  of
the  departmental  suppliers even on the date  when  he     was
giving evidence.  Such a conduct on the part of the  depart-
ment  can only be consistent with the innocence rather    than
the.  guilt of the accused.  If the  prosecution  allegation
was  true   that P.W. 2 through his business  influence     ob-
tained the  order  in  his favour, then before the  prosecu-
tion  was started against the appellant, P.W. 2 should    have
been  blacklisted.  But this was not done.  The     High  Court
appears     to  have been led away by the impression  that     the
appellant  had    personal relations with P.W.  2.  There     is,
however,  no such evidence on record and P.W. 2 himself     has
categorically  stated that his relations with the  appellant
were  purely  business    relations as he used  to  visit     the
office in connection with the supplies off and on.  In these
circumstances, therefore, if P.W. 2 was not suspected by the
prosecution for having received huge pecuniary benefit    much
less could the blame lie on the appellant.
In these circumstances, even if there was some amount of
carelessness  or negligence on the part of the appellant  it
is impossible to doubt his bona fides.    He acted as a produ-
ent  person  and  tried to get the supplies  as     quickly  as
possible  with    the result that all  the  gods    required  by
Jabalpur Depot were supplied within two weeks.
A careful analysis of the evidence and the circumstances
would,    therefore, show that the approach of the High  Court
was clearly
543
wrong  and that the inferences drawn by the High Court    were
not  at all warranted by the circumstances and facts  proved
in the case.  The entire charge against the appellant rested
on circumstantial evidence and the prosecution has failed to
prove  that  the circumstances    were such as  could  be     ex-
plained only on one hypothesis, namely, that the accused was
guilty.
For     these    reasons, therefore, the appeal    is  allowed,
judgment  of  the High Court set aside    and  conviction     and
sentence imposed on the appellant are hereby quashed, and he
is acquitted of the  charge framed against him.
M.R.                       Appeal allowed.
544

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