Holding

The Court held that the possession of illegal gratification creates a statutory burden on the accused to prove his innocence under Section 4 of the Prevention of Corruption Act, and his defence was not credible, so the conviction stands.

Summary

B. Hanumantha Rao, an Excise Sub‑Inspector, was charged with accepting Rs 50,000 as illegal gratification from an arrack contractor. He claimed the money was rent arrears that the contractor could not deposit because the bank was closed, and he refused to keep the cash. The prosecution conducted a trap, recovered the money from Rao’s possession, and a phenolphthalein test showed his hands had handled the cash. The trial court and the Andhra Pradesh High Court convicted him under Section 161 IPC and Sections 5(1)(d) and 5(2) of the Prevention of Corruption Act, sentencing him to two years’ rigorous imprisonment and a fine. On appeal, the Supreme Court held that once illegal gratification is found in the accused’s possession, the burden shifts to him to prove innocence under Section 4 of the Prevention of Corruption Act, and his explanation was not credible; consequently, the conviction and sentence were upheld and the special leave petition dismissed.

Issues considered

Whether the burden of proof shifts to the accused under Section 4 of the Prevention of Corruption Act when illegal gratification is found in his possession.
Whether the accused’s explanation that the money was rent arrears and could not be deposited because the bank was closed constitutes a valid defence.
Whether the testimony of hostile witnesses can be disregarded without affecting the prosecution’s case.
Whether the animosity between the contractor and the accused affects the credibility of the alleged demand and acceptance of gratification.
Whether the sentence imposed should be reduced on the facts of the case.

Legislation cited

Code of Criminal Procedure, 1973s. 313
Indian Penal Code, 1860s. 161
Prevention of Corruption Act, 1947s. 4, s. 5(1)(d), s. 5(2)

Subjects

corruptionillegal gratificationburden of proofPrevention of Corruption Acttrap casephenolphthalein testexcise officerconvictionsentencing

Judgment

A B. HANUMANTHA RAO
v.
STATE OF A.P.

MARCH 26, 1992

B [N.M. KASLIWAL AND S.C. AGRAWAL, JJ.]

Prevention of Corruption Act, 1947 :

Sections 4 and 5-Clzarge of receiving iilegal gratificati01t"'-Trap
C case-Huge amount of money found in the possession of accused-Explain-
ing the circumstances and proving innocence-Burden of proof-Whether
shifted on accused.

The petitioner; an Excise Sub-Inspector, was charged with the of·
fence of accepting an amount of Rs. 50,000 as Hlegal gratification from an
D arrack contractor. The defence of the petitioner was that the Contractor
offered him the said amount towards arrears of rental, stating that he
could not deposit the amount in Bank since the banking hours were over
on that day. Despite his refusal to accept the same and requesting that it
may be remitted in Bank the following day, the Contractor placed the cover
E containing the said amount on the table of the petitionea-, it was claimed.
The trEal court disbelieved the defence vei"sion and convicted the petitioner
and sentenced him to undergo two years rigorous imprisonment and a fine ---'..
of Rs. 2000 and in default thereof, to undergo 2 months 'iimple imprison·
ment.

F On appeal, the High Court confirmed the conviction and sentence
awarded by the trial court. Aggrieved against the said order, the petitioner
has prefened the present special leave petition, raising the same grounds
as were urged before the Courts below.

Dismissing the special leave petition, this Court,
G
HELD : 1.1. It remains undisputed that an amount of Rs. 50,000 was
recovered from the possession of the accused, lying on a tea- poy in a room
of office-cum-residence of the accused. In view of the fact that on washing
the hands of the accused by a 5olution of sodium carbonate, the water
H turned pink. it leaves no manner of dou~t that the amount of Rs. 50,000
358
HANUMANTHA RAO v. STATE 359

was touched and handled by the accused. Under the Excise Rules, the A
accused-petitioner had no right or authority to accept any arrears of
rentals of an excise contract. Even if the bank was cfosed as suggested by
the accused, there was no question of accepting such amount by the
accused as the rentals could ba·fe been deposited by the Contractor in the
bank when it opened. Once the amount of Rs. 50,000 is found in the B
possession of the accused, the burden shifts on him to explain the cir·
cumstances to prove his innocence as contemplated under Section 4 of the
Prevention of Corruption Act. [362C-E]

1.2. Even if the statements of the prosecution witnesses who were
declared hostile are excluded from consideration, it would not make any C
difference in believing the substratum of the prosecution story. [362B, C]

2. The circumstance that the Contractor was inimical and had an
axe to grind inasmuch as be was instrumental in getting the petitioner
transferred and such transfer was subsequently stayed by the Administra·
tive Tribunal, has been considered by the High Court and it rightly took D
the view that such circumstance cannot improbablise the demand and
acceptance of the illegal gratification by the patitioner. The conviction is
based on concurrent findings of fact and appreciation of evidence. Both
the trial court as well as the High Court have considered the facts and
circumstances of the case in detail and have piaced reliance on the E
~ prosecution witnesses and there is no ground or justification to take a
different view. [3~2F-H; 363A]

3. There is no ground or justification to reduce the sentence awarded
to the petitioner, in the facts and circumstances of the case.

CRIMINAL APPELLATE JURISDICTION : Special Leave Peti-
tion (Criminal) No. 2369 of 1991.

From the Judgment and Order dated 19.11.1990 of the A.P. High
Court in Crl. Appeal No. 1047/88. G
P.P. Rao, B. Rajeshwar Rao and Vimal Dave for the Petitioner.

K. Madhava Reddy and G. Prabhakas for the Respondent.

The Judgment of the Court was delivered by H
360 SUPREME COURT REPORTS [1992) 2 S.C.R.

A KASLIWAL, J. This special leave petition (criminal) is directed
against the judgment of the High Court of judicature Andhra Pradesh at
Hyderabad dated 19.11.1990. The petitioner was convicted for offences
punishable under Section 161 I.P.C. and Section 5 (1) (d) punishable under
Section 5 (2) of the Prevention of Corruption Act and sentenced to
B rigorous imprisonment for a period of t'No years and a fine of Rs. 2,000
and in default of payment of fine to suffer two months simple imprisonment
under each count with a. direction that both the sentences shall run con-
currently, by an order of the Principal Specail Judge for SPE & ACB cases
dated 24.11.1988. The High Court dismissed the appeal filed by the
C petitioner and confirmed the conviction and sentence awarded by the trial
court.

We have heard Mr. P.P. Rao, Learned Senior Advocate on behalf of
the Petitioner and Mr. K. Madhava Reddy, Learned Senior Advocate on
behalf of the State of Andhra Pradesh.
D
This is a trap case in which the petitioner was alieged to have
accepted an amount of Rs. 50,000 as illegal gratification on 5.7.1986 while
working as Sub-Inspector of Excise at his office-cum-residence at
Godavarikhani. Briefly stated the prosecution story is that PW.1 A. Baswa
E Reddy took ·arrack contract in partnership of his brother A. Rajender
Reddy (PW .2) and one Arjun for the sale of arrack for Ramagundam
group in Karimnagar district for one year from 1.10.1985 on· payment of
Rs.14 lakhs rental pennensem payable by 20th of each month. The
petitioner was the Excise Sub-Inspector Ramagundam. On 3.6.1986 the

F
petitioner called PW.1 through a constable PW.6 A Narender. PW.1 met .
'
the accused-petitioner on the same day at 9.00 a.m. The accused demanded
bribe of Rs. 50.000 a~d threatened that otherwise he would seize the arrack
. depot at Godavarikhani and its machinery for supplying arrack in
polythene sachets witl;iout permission. When PW.1 requested the accused
to reduce the bribe the accused told him that he used to take 'mamool' of
G Rs. 5,000 per month from the previous contractor. On. 4.7.1986 the accused
again called PW.1 to his office-cum-residence and asked him to pay the.
bribe of Rs. 50,000 by the ne11.t evening otherwise, threatened him as done
earlier. PW.1 on the same day submitted a complaint Exhibit P.1 to Shri
P. Bai Reddy, the then DSP, ACB, Warangal Range. The DSP wit~ the
H assistance of two mediators planned a trap. On 5.7.1986 at about 2.00 p.m.
,.I

HANUMANTHA RAO v. STATE [KASLIWAL, J.] 361

PW.1 met the accused at his office-cum-residence and on a demand made A
by the accused he gave an amount of Rs. 50,000. Immediately thereafter
PW.1 gave a signal to the raiding party and thereupon DSP, ACB (PW.9)
and other members of the raiding party rushed into the office~cum
residence of the accused. The hands of the accused were got washed by a
solution of sodium. carbonate and the solution turned pink. An amount of B
Rs. 50,000 was recovered from the possession of the accused. The accused
was then charged for offences under Section 161 I.P.C. and Section 5 (l)(d)
read with Section 5(2) of the Prevention of Corruption Act. The accused
denied the charges. The prosecution examined (1) witnesses in support of
its case. The accused in his explanation under section 313 of the Code of C
Criminal Procedure, 1973 gave a long statement. But in substance, his
defence was that on 5.7.1986 at about 2.00 p.m. while he was at his
office-cum-residence PW. 7 an Excise constable told him that PW.1 had
come to meet him. The accused then called in PW.1. Then PW.1 gave a
slip Exhibit D.7 showing the remittances made by him towards airears of
rental till 4.6.1986. The same was in the handwriting of PW.2. The accused D
further stated that PW.1 informed him that he could not deposit the
amount towards arrears of rental on that day as banking hours were over,
as it happened to be a Saturday and then offered to give him a cash of Rs.
50,000 towards payment of arrears. So saying, PW.1 took out a cover
containing currency notes and pushed it on the table towards the accused E
. asking him to remit the same towards rentals. Then the accused told hµn
that he had no safe to keep the amount and apart from that he was going
to Karimnagar and therefore asked PW.1 to remit the amount in the bank.
PW.1 then told, that his licence was cancelled previously for non payment
of rentals and therefore it would not be proper to allow the arrears to be
F
accumulated, but inspite of that the accused pushed back the packet
towards PW.land asked him to remit the rentals on the next working day.
By that time PW.l went out leaving the packet of currency notes on the
table on the pretext of bringing some papers from outside. PW.l went near
the jeep and talked with the driver and again came back with some papers.
Immediately thereafter the DSP, ACB and others entered the house and G
subjected him to phenolphthalein test. The accused told the DSP that PW.1
had offered him the amount of Rs. 50,000 towards payment of arrears of
rentals. He admitted that when his fingers were washed in sodium car-
bonate solution it turned into pink colour on account of the reason that he
H
362 SUPREME COURT REPORTS [1992) 2 S.C.R.

A had shaken hands with PW.1.

The Learned Special Judge accepted the case of the prosecution and
disbelieved the version of the accused. The High Court affirmed the
decision of the trial Judge.

B We have beard Shri P.P. Rao,. Learned Senior Counsel for the
petitioner at length. Shri Rao made strenuous effort to convince us to
believe the version given by the accused-petitioner, but in vain. Even if the
statements of PW.6 and PW.7, Excise constables who were declared hostile
are excluded from consideq1.tion, it would not make any difference in
c believing the substratum of the prosecution story. It remains undisputed
that an amount of Rs. 50,000 was recovered from the possession of the
accused, lying on a tea-poy in a room of office-cum-residence of the
accused. In view of the fact that on washing the hands of the accused by a
solution of sodium carbonate, the water turned pink, it leaves 110 manner
D of doubt that the amount of Rs. 50,000 was touched and handled by the
accused. Under the Excise Rules, the accused-petitioner had no right or
authority to accept any arrears of rentals of an excise contract. Even if, the
bank was closed as suggested by the accused, there was no question of
accepting such amount by the accused as the rentals could have been
E deposited by PW.1 in the bank when it opened. Once the amount of Rs.
50,000 is found in the possession of the accused, the burden shifts on him
to explain the circumstances to prove his innocence as contemplate<;i under
Section 4 of the Prevention of O~muption Act. A great stress was laid by
Shri Rao that PW.I was inimical and had an axe to grind with the petitioner
inasmuch as he was instrumental in getting the petitioner transferred from
F Godavarikhani by order dated 16.5.1986 and such transfer was sub-
sequently got stayed hy the Administrative Tribunal by order dated
--
20.5.1986 in a petition filed by the petitioner. The above circumstance ha.s
been considered by the High Court and we agree with the High Court that
when the fact that the accused demanded and accepted illegal gratification
G of Rs. 50,000 on 5.7.1986 is acc!!ptable then such circumstance cannot
improbablise the demand and acceptance. The conviction is based on
concurrent findings of fact and appreciation of evidence. Both the trial
court as well as the High Court have considered the facts and circumstan-
ces of the case in detail and have placed reliance on the prosecution
H witnesses and we do not find any ground or justification to take a different
H.ANUMANTIIA RAO v. STATE [KASLIWAL, J.] 363

view. Shri Rao also submitted that even if this Hon'ble Court was not A
inclined to take a different view from the lower courts, a lenient view may
be taken in awarding the sentence. We find no ground or justification to
reduce the sentence awarded to the petitioner, in the facts and circumstan-
ces of the case.

In the result, we find no force in this petition and the same ts
dismissed.

G.N. Petition dismissed.

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