Holding

When acceptance of gratification is proved, Section 20(1) of the Prevention of Corruption Act imposes a legal presumption that it was accepted as motive or reward, and the High Court’s acquittal was erroneous; the conviction is upheld.

Summary

The State of Andhra Pradesh appealed the acquittal of two public servants who were members of a tender opening committee and were alleged to have demanded and accepted Rs 5,000 each as gratification for clearing a tender file. The complainant lodged a police complaint and was caught in a trap; the money was recovered. The trial court convicted them under Sections 7 and 13(1)(d) of the Prevention of Corruption Act, 1988 and Section 120B IPC. The High Court set aside the conviction, holding that the evidence was not cogent and that a date discrepancy not raised earlier created a new case. The Supreme Court held that Section 20(1) of the Act creates a legal presumption that once acceptance of gratification is proved, it is presumed to be as motive or reward unless rebutted, and that direct evidence is not mandatory. The Court found the testimony of the complainant (PW‑1) and corroborating witnesses (PW‑3, PW‑5) credible, applied the statutory presumption, and restored the conviction with a one‑year rigorous imprisonment and fine for each accused.

Issues considered

The scope and effect of the legal presumption under Section 20(1) of the Prevention of Corruption Act, 1988.
Whether the evidence on record (including the complainant’s testimony and circumstantial evidence) is sufficient to prove demand, acceptance and recovery of gratification.
Whether the High Court could set aside the conviction on the ground of a date discrepancy that was not raised before the trial court.
The relevance of the accused’s authority to clear the tender in establishing the offence.

Legislation cited

Indian Evidence Act, 1872s. 114, s. 4
Indian Penal Code, 1860s. 120B
Prevention of Corruption Act, 1988s. 13(1)(d), s. 20(1), s. 7

Subjects

Prevention of Corruption ActSection 20 legal presumptionBriberyPublic servantCircumstantial evidenceTender corruptionConviction upheldAppeal

Judgment

- STATE OF ANDHRA PRADESH
v.
C. UMA MAHESWARA RAO AND ANR,
A

MARCH 31, 2004

[DORAISWAMY RAJU AND ARIJIT PASAYAT, JJ,] B

' --+-
Prevention of Corruption Act, 1988-Sections 7, 13 & 20(/)/ Evidence
Act, 1872-Sections 4 and 114-Public Servants convicted for taking
gratification from complainant for clearance of tender file-High Court C
acquitting them on ground of non-availability of cogent evidence about demand
a11d acceptance of gratification-Correctness of-Held, Courts can presume
tl1e acceptance ofgratification jiwn the facts produced unless proved otherwise
by accused-On facts and evidence, accused are guilty of accepting
gratification-Hence, conviction upheld.
D
Respondent-public servants were members of a Tender Opening
Committee and were associated with the processing of tender files.
Respondents demanded money as gratification from complainant for clearing
his tender file. The complainant lodged a complaint with police about the
demand of the gratification by the respondents. The police laid a trap and E
caught the respondents red handed while accepting the tainted money from
the complainant. Trial Court found the respondents guilty for offences under
Section 1208 IPC and under Sections 7 and l3(l)(d) read with Section 13(2)
of the Prevention of Corruption Act, (qgg and sentenced them to undergo
two years rigorous imprisonment with fine. The High Court allowed the
appeal of the respondents and acquitted them. F
In appeal to the Court, the appellant-State contended that the High
Court made out a new case about the discrepancy of the date of complaint
which was not taken as a plea by the respondents in their appeal; and that
the evidence of PWs 1, 3 and 5 were cogent and credible to show that the
respondents demanded and accepted money which were subsequently G
recovered from them.

The respondents contended that the complainant had close proximity
with CBI officials and used it as a tactic to get his work done under the threat
of complaint before; that the complainant foisted a false case implicating them; H
665
666 SUPREME COURT REPORTS [2004] 3 S.C.R.

A and that the question of taking gratification from the complainant does not
arise since the tender file of the complainant had already been cleared which
is known to the complainant.

Allowing the appeals, the Court

B HELD: 1.1. When Section 20(1) of the Prevention of Corruption Act,
1988 deals with legal presumption, it is to be understood as in terrorem i.e.
in tone of a command that it has to be presumed that the accused accepted
the gratification as a motive or reward for doing or forbearing to do any
official act etc., if the condition envisaged in the former part of the Section is
C satisfied. The only condition for drawing such a legal presumption under
Section 20 of the Act is that during trial it should be proved that the accused
has accepted or agreed to accept any gratification. The Section does not say
that the said condition should be satisfied through direct evidence. Its only
requirement is that it must be proved that the accused has accepted or agreed
to accept gratification. Direct evidence is one of the modes through which a
D fa'.'.t can be proved. But that is not the only mode envisaged in the Evidence
Act. (672-H; 673-A-B(

M Narsinga Rao v. State of A.P., (2001 ( 1 SCC 691, referred to.

1.2. Proof of the fact depends upon the degree of probability of its having
E existed. The standard required for reaching the supposition is that of 11 prudent
man acting in any important matter concerning him. In reaching a conclusion,
the Court can use the process of inferences to be drawn from facts produced
or proved. Such inferences are akin to presumptions in law. Law gives absolute
discretion to the Court to presume the existence of any fact which it thinks
p likely to have happened. Presumption is an inference of a certain fact drawn --{ .
from other proved facts. While infering the existence of a fact from another,
the Court is only applying a process of intelligent reasoning which the mind
of a prudent man would do under similar circumstances. Presumption is not
the final conclusion to be drawn from other facts. But it could as well be final
if it remains undisturbed later. Presumption in law of evidence is a rule
G indicating the stage of shifting the burden of proof. From a certain fact or
facts, the Court can draw an inference and that would remain until such
inference is either disproved or dispelled. For the purpose of reaching one
conclusion the Court can rely on a factual presumption. Unless the
presumption is disproved or dispelled or rebutted, the Court can treat the
H presumption as tantamounting to proof. However, as a caution of prudence
STATE OF AN DH RA PRADESH v. C. UMA MAHESWARA RAO 667

it has to be observed that it may be unsafe to use that presumption to draw A
yet another discretionary presumption unless there is a statutory compulsion.
1673-C; 673-E, F-G, H; 674-AI

Suresh Budharmal Kala11i v. State of Maharashtra, 119981 7 SCC 337:
Raghubir Singh v. State of Punjab, 1197414 SCC 560; Ha:ari Lal v. State (Delhi
Admn), 1198012 SCC 390; Madhukar Bhaskarrao Joshi v. State of Maharashtra, B
1200018 SCC 571; Mohmccdkhan Mahboobkhan Pathan v. State of Maharashtra,
11997110 SCC 600; The State ofAssam v. Krishna Rao, 1197313 SCC 227; C./.
\ 'i· Emden v. State of Uttar Pradesh. AIR (1960) SC 548; V.D. Jhangan v. Stale of
Uttar Pradesh. 1196613 SCR 736 and State ofA.P. v. V Vasudev Rao, JT (2003)
9 SC 119, referred to.
c
Hawkins v. Powells Tillery Steam Coal Co. ltd, 1191111 KB 988, referred
to.

Black's Law Dictionary; Oxford Advance Lean:er's Dictionary of
Current English, referred to.
D
1.2. The evidence of PW I complainant cannot be ignored on the ground
that he had earlier made grievances against some other officials. The Trial
Court had carefully analysed the evidence of PW l and found the same to be
credible. The evidence of PW-! coupled with those of PWs 3 and 5 is sufficient
to bring home the accusations. A bare reading of the contents of the co:nplaint
and the date put in the complaint clearly show that the High Court was not E
correct j.n saying that the date of the document is incorrect. Additionally, this
plea was not raised before the Trial Court. It being essentially a question of
fact, the High Court could not have made out a new case regarding correctness
of the date. The views ofthe High Court were also not correct when the
1 ;,... document is itself looked at. The question whether a person has authority to F
do the act for which bribe is accepted is of no consequence. 1677-FI

Chacurdas Bhagwanffas Patel v. The State of Gujarat, 119761 3 SCC 46,
referred to.

CRIMINAL APPELLATE JURIS.DICTION : Criminal Appeal Nos. 468- G
469 of 1998.

From the Judgment and Order dated 10.9.97 of the Andhra Pradesh
High Court in Crl. A. Nos. 47 and 100 of 1995.

Sanjay Karol, Ajit S. Blu;sme, Jogy Scaria and B.V. Bairam Das for the
Appellant. H
668 SUPREME COURT REPORTS 12004] 3 S.CR.

A U.R. Lalit. Y. Raja Gopala Rao and Ms. Sasmita Tripathy for the
Respondent No. I

Ms. K. Amareswari and Anil Kumar Tandale for the Respondent No.
2.

B The Judgment of the Court was delivered by

ARIJIT PASAYAT, J. State of Andhra Pradesh questions legality of
the judgment rendered by a learned Single Judge of the Andhra Pradesh High ..,.. '
Court directing acquittal of the respondents who were accused nos. I and 2
respectively before the Trial Court i.e. Special Judge, CBI, Visakhapatnam.
C The respondents faced trial for alleged commission of offences punishable
under Sections 7 and 13 of the Prevention of Corruption Act, 1988 (in short
the 'Act'). The Trial Court found each to be guilty and sentenced to undergo
two years RI and to pay a fine of Rs. 1,000 with default stipulation. They
were also convicted under Section 120B of the Indian Penal Code, 1860 (for
D short the 'IPC'), sentenced to similar custodial punishment and to pay a fine
of Rs. 2000. But in appeal the conviction and sentence were set aside.

Factual position as highlighted by the prosecution is as follows:

C. Uma Maheswara Rao (A-1) was working as Deputy Secretary of
E Visakhapatnam Port Trust and D. Satyananda Recldy (A-2) was worki11g as
Deputy Financial Adviser and Chief Accounts Officer of Visakhapatnam Port
Trust. G. Subrahmanyam (PW- I) was the General Power of Attorney holder
of Mis Ramesh Chandra & Company. Both the accused were members of
Tender Opening Committee and were associated with the processing of tender
file No.CllBG/Sleepers1Riskl91. The file dealt with placement of purchase
F order for Assam Salwood Sleepers during the period from September, 199 l
to December, 1991. Aforesaid Ramesh Chandra & Company through its
power of Attorney holder (PW- I) submitted their quotation at Rs. 828 per
sleeper and the total tender value was Rs. 1,33,'84, 702.80. A-1 phoned to
PW-I on 28.12.1991 at about 11.00 a.m. and asked him to meet him in the
G evening at his residence for discussions with regard to tender matter and PW-
1 went to his house at 8.30 p.m. on the same day and A-2 was also present
there. Both the accused, who were Public Servants, during the discussion
informed PW-I that there were many complications in the tender filt: and
demanded Rs. 20,000 each to be paid as bribe to clear the file in favour of
Mis. Ramesh Chandra & Co. They also told him that they would not clear
H the file, if he fails to meet the said demand and when PW-I expressed his
STATE OF ANDHRA PRADESH 1·. C. UMA MAHESWARA RAO fPASAYAT, J.] 669
financial constraints, they said that they should be paid Rs. 5.000 each as A
advance and balance amount was to be paid after release of the purchase
order. A-I had contacted PW-I over telephone at about 12.00 noon on
30.12.1991 and asked him to keep the demanded amount ready so that he
would come along with A-2 and collect the same around 8.30 p.m. on that
day at Basant Lodge, Visakhapatnam. Thereafter, PW-I lodged a complaint B
with the Superintendent of Police, C.B.l. Visakhapatnam on 30.12.1991 about
the demand of bribe by the accused and on the basis of his complaint,
- "+ investigation was taken up by registering a case i.e. R.C. No. l 9(A)/9 I. Both
the accused were caught red handed at about 10.15 p.m. on 30.12.1991 in
Room No.208 of Basant Lodge, Visakhapatnam soon after they demanded
and accepted bribe amount of Rs.5,000 each from PW-I as a motive or C
reward for clearing the tender file in favour of Mis. Ramesh Chandra & Co.
The tainted currency notes amounting to Rs.10,000 were recovered
immediately from the polythene carry bag which was available with A-1.
Both the accused abused their official position as public servants and after
obtaining sanction under Section 19(1 )(c) of the Act, from the Chairman, D
Visakhapatnam Port Trust a charge sheet was filed under Section I 20B lPC
\ and Sections 7 and 13 (l)(d) read with Section 13 (2) of the Act. The accused
)
denied their guilt. The prosecution in support of its case examined 32 witnesses
while the accused· to substantiate their plea of innocence examined 5 witnesses.
PW-2 who was takeri as witness to prove the acceptance and recovery of the
money from PW-I resiled partially from the statement given during E
investigation.

Placing reliance on the evidence of PW-I, PW-3 and PW-5, the Trial
Court held that there was cogent and credible evidence to show not only
I > demand, acceptance but also recovery of the money. PW-3 was at the relevant F
time working as Preventive Officer, Customs and worked as the mediator.
PW-5 was the investigating officer who received the complaint, and monitored
the trap operation. In appeal, before the High Court the stand taken by the
accused persons was that there was no cogent evidence regarding demand.
PW-I complainant was not reliable. The so-called complaint before the CBI
is dated ::0.12.1991. Specific stand of the rrosecution was that the complaint G
was made on 30.12.1991 as per Exts. P-3 and P-3A. PW-2 who was one of
the mediators did not support the prosecution version completely. It was not
possible to accept that high ranked officers would take and accept money in
the presence of an unknown party. There is no consistent evidence as regards
the first and the subseque'lt demands. Since A-1 was not competent to finalise H
670 SUPREME COURT !ff !•OR I~ j200~1 :; S.C.R.

A rhe tenders, it was not possible that he 11uuld demand money. Further the
evidence on record clearly establishes that by the time of alleged demand
files had been cleared by A-1 and. therc1ure. it is not believable that the
demand was made. PW-I in the guise of ;1rra11ging a dinner took revenge on
the accused persons for seeking legal advice before acceptance of the tender.
B With these observations, the High Court set :i;id<' the conviction and sentence
as noted above.

In support of the ~ppeals, learned counsel appearing for the appellant-
State submitted that the order of the High Court is clearly erroneous. The
correct position in law regarding presumptions was not kept in view. The
C High Court made out a third case which was not even urged by the accused
persons before the Trial Cou11 regarding the alleged discrepancy of the date
of the complaint. It was pointed out that nowhere any such plea was raised
by the accused persons that the complaint is dated 20.12.1991. Documems
clearly show that it is dated 30.12. I991. It is not known as to why the High
D Court made out a new case which was not even pleaded. Evidence of PW-
1 clearly establishes the demand and the recovery of money. The High Court
came to a conclusion that third party was present and high placed officers J.-·
would not normally make a C:emand in the presence of sud1 a person. In !act,
PW-2 was introduced to be Group Finance Manager of Mrs. Ramesh Chandra
& Co. by PW- I. No direct evidence is necessary to show r.:garding acceptance
E of money. The Trial Court has analysed in great ddail the factual position
and the High Cou11 without even conside1 ing those reasons and indicating
any reason as to why a different view was to be taken has dir~ckj acquittal.

Accused took the stand pleading that a tekphonil 111c,;,;age was given
in his house that there was a dinner in the Basant Lodge. A-5 took tht: stand
F
that he had gone to purchase sweets. At the time of search apart from the
tainted money Re.0.45 was found with him. It is unbelievable that somc~body
would go to buy sweets with 45 paise in pocket. There was no variation and
discrepancy in the evidence. The mediator report and the evidence of the
witnesses clearly establish the accusations.
G
The High Court has observed that the accused persons being only
members of the tender committee possibility of making a demand was not
there.

In response. Mr. U.R. Lalit, learned counsel for respondent no.1 (A-!)
H submitted that probabilities of the case have to be looked into and no strait
STATE OF ANDHRAPRADESHl'. C. UMA MAHESWARA RAO[PASAYAl. J. J 671

jacket formula can be adopted for deciding a case of this nature. He referred A
to evidence regardin·g the accepted position that the complainant had made
grievance not only against the accused :iersons, but also on the same date
against another officer of the Port Trust. Earlier also he had made certain
grievances against others. This is a clear tactic to get his work done under the
threat of complaint. Taking advantage of the proximity with the CBI officials B
false case has been foisted. In this background, the complainant (PW- I )'s
version required strong corroboration which is absent. PW-2's evidence does
not show any demand. The manner of collecting sample is also totally not
above board. Since the file had already been cleared the question of making
a demand of bribe would not arise. Further the complainant had been visiting
the office and it is not improbable that he had knowledge about accused C
persons having cleared the file earlier to the date of demand. The clout
enjoyed by PW-I in the office and the fayour shown to him by some members
of the Port Trust is clearly established by the evidence on record. The evidence
of PW-I clearly shows that he had not informed accused persons about the
booking of room at Basant Lodge. It is improbable that the accused persons
would choose the lodge for accepting the bribe, when the prosecution case D
itself is that PW-I had gone to the house of A-I earlier when PW-2 was
present there. The plea of accused persons that PW- I called them to the
Basant Lodge on the pretext of dinner is also con·oborated by the evidence
of PW-11. Since view taken by the High Court is reasonable one, no
interference is called for. Suggestion was given that the documents were not E
prepared at the time claimed. The statutory presumption under the Act can
be applied under Section 7 and not 13. Since PW-2 was examined on the
panch witnesses, his evidence assumes importance and since the High Court
held that his evidence on certain aspects is discrepant and contradictory, PW-
1's evidence becomes suspect. In this background no interference is called
~ F
Learned counsel for respondent no.2 (A-2) adopted the stand of A-1.
In addition she submitted that there was no evidence of making a demand
and his presence at the house of A-1 as claimed is also not established. The
High Court has rightly observed that PW- I is not a reliable witness and come G
to the right conclusion. The view is not in any way perverse to wamult
interference.

The evidence of PWs I and 5 are discrepant as to where the copy of
Ext.P-3 was prepared. While it was PW-1 's case that it was made in his
office, PW-3 said it is prepared in the office of CBI. H
672 SUPREME COURT REPORTS 1200-11 3 S.CR.

A By way of reply. learned counsel for the State submitted that the pica
that CBI officials had conspired to falsely implicate A-1 and A-2 is clearly
unbelievable and looks absurd on the facts of the case. Nu reason has been
indicated as to why the CBI officials would falsely implicate the accused
persons in the case. It has been recorded that there was no restaurant facility
at Basant Lodge and the. plea that there was a telephone call regarding the
B official dinner at Basant Lodge is clearly without any substance. Further, on
2.12.1991 the Chairman had asked for certain clarifications. A bare look at
the complaint shows that it refers to the occurrence of the same date i.e.
30.12.1991. This basic factor has been overlooked by the High Court in
making out a new case.
c For appreciating rival stands it would be proper to quote Section 20(1)
of the Act, which reads as follows:

"20( 1): Presumption where public servant accepts gratification other
than legal remuneration.-( 1) Where in any trial or an offence
D punishable under Section 7 or Section 11 or clause (a) or clause (b)
of sub-section ( 1) of Section 13 it is proved that an accused person
has accepted or obtained, or has agreed to accept or attempted to
obtain for himself, or for any other person, any gratification (other
than legal remuneration) or any valuable thing from any person, it
shall be presumed, unless the contrary is proved that he accepted or
E obtained, or agreed to accept or attempted to obtain, that gratification
or that valuable thing, as the case may be, as a motive or reward such
as is mentioned in Section 7 or, as the case may be, without
coasideration or for a consideration which he knows to be inadequate."

Before proceeding further, we may point out that the expressions ·'may -"' '
F presume" and "shall presume" are defined in Section 4 of the Indian Evidence
Act, 1872 (in short the 'Evidence Act'). The presumptions falling under the
former category are compendiously known as "factual presumptions" or
"discretionary presumptions" and those falling under the latter as "legal
presumptions" or "compulsory presumptions". When the expression "shall be
G presumed" is employed in Section 20( I) of the Act, it must have the same
import of compulsion.

When the sub-section deals with legal presumption, it is to be understood
as in terrorem i.e. in tone of a command that it has to be presumed that the
accused accepted the gratification as a motive or reward for doing or forbearing
H to do any official act etc., if the condition envisaged in the former part of the
I
+

ST.YIT OF ANDHRA l'RAIJESH ,. C UMA MAI !I'S\\' ARA RAO [!'ASA YAT . .I ..I 673

sectit>n is satisfied. The only rnnditiun tor drawing such a legal presumption A
ulidcr Section :!O is that during trial it "hould be proved that the accused has
acccpkd or agreed to accept any gratitication. The Section docs not say that
th~ said condition should be satisfied through direct evidence. Its only
requirement is that it must be proved that the accused has accepted or agreed
to accept gratification. Direct evidence is one of the modes through which a B
fact can be proved. But that is not the only mode envisaged in the E~ idence
Act. (See M. Narsinga Rau v. State of A.P.. [200!) 1 SCC 691).

Proof of the fact depends upon the degree of probability of its having
e.xi.sted. The standard rc<.juired for reaching the supposition is that of a prudent
man acting in any important matter concerning him. Fletcher Moulton l.J. in C
Hawkins v. Powl!!ls Tille1:rStea111 Cua/ Cu. Ltd., (1911 (1) KB 988) observed
as follows:

''Proof does not mean proof to rigid mathematical demonstration.
because that is impossible; it must mean such evidence as would
induce a reasonable man to come to a particular conclusion". D
The said observation has stood the test of time and can now be followed
as the standard of proof. In reaching the conclusion the Court can use the
process of inferences to be drawn from facts produced or proved. Such
inferences are akin to presumptions in law. Law gives absolute discretion to
the Court tu presume the existence of any fact which it thinks likely to have E
happened. In that process the Court may have regard to con1111on course of
natural events, human conduct, public or private business vis-a-vis the facts
of the particular case. The discretion is clearly envisaged in Section 114 of
the Evidence Act.

·~ Presumption is an inference of a certain fact drawn from other proved F
facts. While inferring the existence of a fact from another, the Court is only
applying a process of intelligent reasoning which the mind of a prudent man
would do under similar circumstances. Presumption is not the final conclusion
to be drawn from other facts. But it could as well be final if it remains
undisturbed later. Presumption in law of evidence is a ruk indicating the G
stage of shifting the burden of proof. From a certain fact or facts the Court
can draw an inference and that would remain until such inference is either
disproved or dispdled.

For the purpose of rcachin~ one condusiun the Cou11 can rel) un a
h1ctual pre,umptiun. Unk;·; ti:.: prc·,u1Pp!i.i11 i,; Ji,r1'"~'1 nr dispdk'll "r H
674 SUPREME COURT REPORTS 120041 3 S.C.R.

A rebutted the Court can treat the presumption as tanta111ounting r.o proof. ....
However, as a caution of prudence we have to observe that it may be unsafe
to use that presumption to draw yet another discretionary presumption unless
there is a starutory compulsion. This Court has indicated so in Suresh
Budharm(J/ Kalani v. State of Maharashtra, [1998] 7 SCC 337: "A presumption
B can be drawn only from facts a.nd not from other presumptions by a process
of probable and logical reasoning".

Illustration (a) to Section 114 of the Evidence Act says that the Court
may presume that "a man who is in the possession of stolen goods soon after ~ ·
the theft is either the thief or has received the goods knowing them to be
C stolen, unless he can account for his possession". That illustration can profitably
be used in the present context as well when prosecution brought reliable
materials that there was recovery of money from the accused. In fact the
receipt and recovery is accepted. The other factor is the acceptability of the
plea of loan, which the High Court itself has not held cogent or credible.

D We may note that a three-Judge Bench in Raghubir Singh v. State of
Punjab, [1974] 4 SCC 560 held that the very fact that the accused was in
possession of the marked currency notes against an allegation that he demanded
and received the amount is "res ipsa loquitur".

In Hazari Lal v. State (Delhi Admn.), [1980] 2 SCC 390) it was observed
E that there is no requirement to prove passing of money by direct evidence.
It may also be proved by circumstantial evidence. In Madhukar Bhaskarrao
Joshi v. State of Maharashtra, [2000] 8 SCC 571 it was observed thus:

"The premise to be established on the facts for drawing the
presumption is that there was payment or acceptance of gratification.
F Once the said premise is established the inference to be drawi1 is that
the said gratification was accepted "as motive or reward" for doing
or forbearing to do any offic!al act. So the word "gratification'' need
not be stretched to mean reward because reward is the outcome of the
presumption which the court has to draw on the factual premise that
G there was payment of gratification. Th is will again be fortified by
looking at the collocation of two expressions adjacent to each other
like "gratification or any valuable thing". If acceptance of any valuable
thing can help to draw the presumption that it was accepted as motive
or reward for doing or forbearing to do an official act, the word
"gratification" must be treated in the context to mean any payment
H for giving satisfaction to the public servant who received it".
STATE OF ANDI IRA PRADESH''· C. UMA MAHES\VARA RAO [PASAYAT ..1. J 675
· fn Black's Law Dictionary, "gratification" is defined as "a recompense A
or reward for services or benefits. given voluntarily, without solicitation or
promise". But in Oxford Advance Learner's Dictionary of Current English
the said word is given the meaning "to give pleasure or satisfaction to".
Among the above two descriptions for the word "gratification" with slightly
differing nuances as between the two, what is more appropriate for the context B
has to be found out. The context in which the word is used in Section 4( I)
of the Act is, hence, important.

In Mohmoodkhan Mahboobkhan Pathan v. State of Maharashtra, (1997]
JO SCC 600 this Court has taken the same meaning for the word "gratification"
appearing in Section 4( I) of the Prevention of Corruption Act, 194 7 C
(hereinafter referred to as 'the old Act'). We quote the following observations:

"7. The primary condition for acting on the legal presumption under
Section 4( I) of the Act is that the prosecution should have proved
that what the accused received was gratification. The word
'gratification' is not defined in the Act. Hence, it must be understood D
in its literal meaning. In the Oxford Advance Learner's Dictionary of
Current English, the word 'gratification' is shown to have the meaning
'to give pleasure or satisfaction to'. The word 'gratification' is used
in Section 4(1) to denote acceptance of something to the pleasure or
satisfaction of the recipient."
E
The provisions of Section 4(1) of the old Act and Section 20(1) of the
Act are almost identically worded.

What is the concept of gratification has been succinctly stated by this
Court in The State of Assam v. Krishna Rao, (1973] 3 SCC 227, through p
illuminating words, after quoting Section 4 of the Act.

"22.·/n State of Madras v. A. Vaidiaratha Iyer, (1958] SCR 580 after
reproducing the relevant provisions of Section 4 of the Act this Court
observed that where it is proved that a gratification has been accepted
the presumption under Section 4 of the Act shall at once arise. It is G
a presumption of law and it is obligatory on the Court to raise it in
every case brought under Section 4. In the reported case this Court
allowed the appeal of the State of Madras and setting a~ide the
impugned order of acquittal passed by the High Court restored that
of the Special Judge convicting the respondent there. In C. /. Emden
v. The State of U.P .. AIR (1960) SC 548 the appellant who was H
676 Slll'RLME COllR I Rl·:J'OR IS j201l4j 3 S.C.R.

A working as a local foreman, was found to have accepted a sum of
Rs.375 from a railway contractor. The appellant's explanation was
that he had borrowed the amount as he was in need of money for
meeting the expenses of the clothing of his children who were studying
in school. The Speci~I Judge accepted the evidence of the contractor
and held that the money had been taken as a bribe, that the defence
B story was improbable and untrue, that the presumption under Section
4 of the Act had to be raised and that the presumption had not been
rebutted by the appellant and accordingly convicted him under Section
161 IPC and Section 5 of the Act. On appeal the High Court held that
on the facts of that case the statutory pre·mmption under Section 4
c had to be raised, that the explanation offered by the appellant was
improbable and palpably unreasonable and that the presumption had
not been rebutted, and upheld the conviction. The appellant contended,
on appeal in this Court, inter alia: (i) that the presumption under
Section 4 could not be raised merely on proof of acceptance of money
but it had further to be proved that thE money was accepted as a
D
bribe, (ii) that even if the presumption arose it was rebutted when the
appellant offered a reasonably rrobable explanation. This Cou11,
dealing with the presumption under Section 4, observed that such
presumption arose when it was 5hown that the accused had received
the stated amount and that the said amount was not legal remuneration.
E The word 'gratification' in Section 4( 1) was to be given its literal
dictionary meaning of satisfaction or appetite or desire; it could not
be construed to mean money paid by way of a bribe. The High Court
was justified in raising the presumption against the appellant as it was
admitted that he had received the money from the contractor and the
amount received was other than legal remuneration. On the facts the
F
explanation given by the accused. in agreement with the opinion of
the High Court was held to be wholly unsatisfactory and unreasonable.
In Dhanvantrai. v. Stale of Maharashtra, AIR (1964) SC 575 it was
observed that in order to raise the presumption under Section 4( I) of
the Act what the prosecution has lo prove is that the accused person
G has received 'gratification other than legal remuneration' and when it
is shown that he has received a certain sum of money which was not
a legal remuneration, then, the condition prescribed by this s1~ction is
satisfieu and the presumption thereunder must be raised. In Jhangan
v. State ofU.f'. ll968] 3 SCR 766 the above decisions were approved
H and it is observed that mere receipt of money is sufficient to raise the
STATE or ANDI IRA l'RADESll 1· c llMA MAllESWARA RAO [PASAYA T. .1.1677

presumption under Section 4( I) of the Act.'' A
In C./. Emden v. Slate of U1tar Pradesh, AIR (1960) SC 548 and V.D.
Jhangan v. State of Uuar Pradesh, [1966] 3 SCR 736 it was observed that
if any money is received and no convincing, credible and acceptable
explanation is offered by the accused as to how it came to be received by
him, the presumption under Section 4 of the old Act is available. When the B
receipt is admitted it is for the accused to prove as to how the presumption
is not available as perforce the presumption arises and becomes operative.

These aspects were highlighted recently in State of Andhra Pradesh v.
V. Vasudev Rao, JT (2003) 9 SC 119.
c
The evidence of PW-1 cannot be ignored on the ground that he had
earlier made grievances against some other officials. The Trial Court had
carefully analysed his evidence and found the same to be credible. Even if
PW-2 did not support the prosecution version en some aspects yet his evidence
also proves giving of money. The evidence of PW- I coupled with those of D
PWs 3 and 5 is sufficient to bring home the accusations. Further, the High
Court seems to have made out a new case about the alleged date of complaint.
A bare reading of the contents of the complaint and the date put in the
complaint as evident from Exts. P-3 and P-3A clearly show that the High
Court was not correct in saying that the date of the document is 20.12.1991.
Additionally. this plea was not raised before the Trial Court. There was even E
no suggestion about that aspect. Learned counsel for A-1 and A-2 submitted
that suggestions were there, which is not so. What was suggested was the
documents were not prepared at the time they were claimed to be. There is
a gu If of difference between "time" and "date". In any event such a plea has
not been taken before the courts below. It being essentially a question of fact, F
the High Court could not have made out a n~w case regarding correctness of
the date. As noted above, the views of the High Court were also not correct
when the document is itself looked at. Much stress was laid on the accused
persons not being the final authority in the tender matter. As noted in Chaturdm
Bhagwandas Patel v. The State of Gujarat, [ 1976] 3 SCC 46 the question
whether a person has authority to do the act for which bribe is accepted is G
of no consequence.

Keeping in view the legal principles as can be culled out from decisions
referred to above, applying the fact situation to them the inevitable conclusion
is that the High Court was not justified in directing acquittal. Not only the
correct legal position was not kept in view but the analysis of the factual H
678 SUPREME COURT REPORTS [2004] 3 S.C.R.

A position is also found to be erroneous. That being so, the judgment of the
High Court is set aside. Custodial sentence of one year for each of the proved
offence would meet the ends of justice, with the fine and default stipulation
stipulated by the Trial Court.

The appeals are allowed to the extent indicated. The accused persons
B are directed to surrender to custody to serve remainder of sentence, if any.
B.S. Appeals allowed.
••