STATE TR. INSP. OF POLICEversusA. ARUN KUMAR & ANR.

•                  (2014] 11 S.C.R. 319

              STATE TR. INSP. OF POLICE
                            v.
                                                             A

                A. ARUN KUMAR & ANR.
           (Criminal Appeal No. 2602 of 2014)
                  DECEMBER 17, 2014
                                                             B
     [DIPAK MISRA AND UDAY UMESH LAUT, JJ.]

      Code of Criminal Procedure, 1973 - s.239 - When
accused shall be discharged - Allegations against accused
no. 1 to 3 that they entered into criminal conspiracy with c
accused no. 4 and 5, in pursuance thereof filed false and
fabricated document to claim duty draw back - Registration
of case against respondents-accused under the provisions of
Penal Code, Prevention of Corruption Act, and the Customs
Act - Application by respondents u/s. 239 seeking discharge D
- Dismissal of, by the Special Court-holding that a case for
framing charges against respondents was made out -
Revision by respondents - Allowed by the High Court since
no case was made out to frame any charges against
respondents - On appeal held: The material on record E
disclosed grave suspicion against the respondents - Special
Court was right in framing charges against the respondents -
Thus, order passed by the Special Court restored and that of
the High Court set aside - Penal Code, 1860 - ss. 468, 471
 a.nd 201 - Prevention of Corruption Act, 1988 - ss.13(1)(c), F
 13(1)(d), 15 - Customs Act, 1962 - ss.132, 136.

    Allowing the appeal, the Court

     HELD: The documents placed on record-copies of
shipping bills and corresponding Exchange Control G
dcl.:laration forms which are part of charge-sheet
disClosed grave suspicion against the respqndents and
the Special Court was right in framing charges' against the

                            319                              H
    320     SUPREME COURT REPORTS               [2014] 11 S.C.R. •


A   respondents. The High Court was not justified in stating
    that Section 15 of the Prevention of Corruption Act, 1988
    could not be invoked. Since the duty draw back was not
    actually availed, the prosecution rightly alleged that there
    was an attempt to commit offence under the relevant
B   clauses of Section 13(1) of the POC Act. It is not the '
    requirement of law that in order to charge an accused
    under Section 15 of the POC Act he must also be charged
    either under Section 13(1)(c) or 13(1)(d) of the POC Act.
    Thus, the judgment and order passed by the High Court
c   is set aside and that of the Special Court is restored.
    [Para 6, 9, 1O] [326-D; 329-E-H; 330-A]

        Ganga Kumar Srivastava v. State of Bihar (2005) 6 SCC
    211; Sajjan Kumar v. CBI 2010 (11) SCR 669: (2010) 9 SCC
    368; Union of India v. Praful/a Kumar Sama/ (1909) 3 SCC
D   4; Di/a war Balu Kurane v. State of Maharashtra 2002 (1)
    SCR 75: (2002) 2 SCC 135 - referred to.
                           Case Law Reference:
          (2005) 6 sec 211        Referred to         Para 6
E
          2010 (11) SCR 669       Referred to         Para 8
          (1909) 3 sec 4          Referred to         Para 8
          2002 (1) SCR 75         Referred to         Para 8
F
        CRIMINAL APPELLATE JURISDICTION : Criminal Appeal
    No. 2602 of 2014.

        From the Judgment & Order dated 28.08.2011 of the High
    Court of Judicature of Madras in Crl.RC. No. 106 of 2009.
G
       Vibha Dutt Makhija, T.A. Khan, Charul {3arin, Arivind
    Kumar Sharma, B.V. Bairam Das for the Appellant.

          B.A. Khan, Ratnakar Dash, Madhurima Mridul, Sunil
H
•     STATE TR. INSP. OF POLICE v. A. ARUN KUMAR             321

    Fernandes, Astha Sharma, Mithu Jain, B. Karunakar, B.           A
    Shajjmon, Vikash Singh for the Respondents.

        The Judgment of the Court was delivered by

         UDAY UMESH LALIT, J. 1. Leave granted. This appeal
    arises out of the judgment and order dated 22.08.2011 passed    8
    by the High Court of Madras in Crl. R.C. No.106 of 2009
    whereby it set aside the order of the Special Court dated
    19.12.2008 dismissing the application for discharge preferred
    by the Respondents herein.
                                                                    c
          2. On 08.02.2007 RC-1/E/2007-CBl/EOW/CHENNAI was
    registered under sections 1208 read with section 420, 467,
    468, 471 IPC and 477-A IPC and section 13 (2) read with
    section 13(1)(d) of The Prevention of Corruption Act, 1988
    (POC Act for short) and section 32 of the Customs Act, 1962 D
    on the allegations that accused nos. 1-3 named therein had
    entered into a criminal conspiracy with accused no.4 who was
    Appraiser of Customs, Inland Container Depot (ICD), lrugur,
    Coimbatore and with accused no.5, Inspector of cu~toms,
    Inland Container Depot, lrugur, Coimbatore during 2004-2005 E
    and in pursuance of said conspiracy had filed false and
    fabricated documents to claim duty draw back to the tune of
    Rs.2.14 crores (approximately) from ICD, lrugur. It was alleged
    that said accused nos.1-3 had filed certain Shipping Bills and
    that the export documents were assessed by accused no.4 i.e. F
    respondent no.1 and after such assessment the goods were
    examined by accused no.5 i.e. respondent No.2. After
    completion of the customs formalities the goods were stuffed
     in containers which were sealed and transported to Cochin for
    consignment to Dubai. It was alleged that accused no.1 G
    produced different sets of forged shipping bills by adding a digit
    before the total quantity of shipment thereby inflating the value
    of shipment and fraudulently claimed duty draw back. These
    forged shipping bills were endorsed by the respondents. A
                                                                    H
A
    322       SUPREME COURT REPORTS                  [2014] 11 S:C.R.


    chart was relied upon to show how the total quantity and the
                                                                         •
    present market value differed by addition of a digit. The chart
    was as follows:

     Name of          Total Qty. Total Qty.  Present          Present
B    the Firm          in Kg     (Net        Market           Market
                      (Net       Weight as Value              Value
                      Weight     declared    declared in      decla-
                      as         inGRF       transference     red in
                      declared Form          Shipping         GR
c                     in         Shipping    Bill (Indian     Form
                      transfer- Bill)        Rupee)           Shipping
                      ence       presented Bill               Rupee)
                      copy of    to RBI for
                      Shipping matching
                      Bill       for
D
                      (presen- foreign
                      ted to     Exchange
                      Cochin     Realisation
                      Customs)
E    [1]              [2]        [3]         [4]              [5]

     M/sJ.S.          79257      479257      17492880 117492880
     Babu, Inc.

     Mis Samy         27176      187176      4850990        44850990
F
     Metal
     Industries

     M/s        38836            258836      8586055        63586055
     Ayyappan,
G    Industries
              I
                  i
     Total                                   30929925 225929925

           3. A regular case was registered on the allegations as
H
•    STATE TR. INSP. OF POLICE v. A. ARUN KUMAR              323
                [UDAY UMESH LAUT, J.]
    aforesaid and investigation was conducted by CBI which later A
    filed charge sheet against said five accused on 28.04.2008.
    The allegations against respondent nos. 1 & 2 were:

        " ......... A-4 Arun Kumar while preparing GR Forms is
        supposed to assess the value in Indian rupees for the value B
        mentioned in US dollars by the Exporter. While preparing
        GR Forms, A-1 Manish Kumar Jain and A-2 R.V.
        Shanmugam prepared two such documents one showing
        correct weight in kg and value in US dollars and the other
        having inflated weight in kg and value in US dollars. A-1 C
        Manish Kumar Jain and A-2 R.V. Shanmugam have put
        two before the weight inflating by 20,000 kgs and one
        before the value in US dollars inflating it by 1 lakh dollars.
        But A-4 Arun Kumar while endorsing it in the reverse of
        the form assessed and calculated the value of export in
        rupees and wrote the same in his own handwriting under D
        his signature. But in the present market value mentioned
        in the GR Forms by the Exporter, a digit five has been
        added before the value in rupees, thus inflating the value
        by Rs.50 lakhs. This value, of course could not be the
        correct value if calculate at the rate of Rs.43.55 per US E
        dollar. This was deliberately overlooked by A-4 Arun
        Kumar and he failed to prepare the GR Forms in
        consultation with the Shipping Bills where there is a
        difference of Rs.50 lakhs in each and every GR Forms
        submitted by the Exporter. When such malpractices by the F
        Officers of ICD, lrugur came to the knowledge of the
        Directorate General of Central Excise Intelligence, A-4
        Arun Kumar with the connivance of A-5 Santhosh Kumar,
        Sr. Tax Assistant (STA) destroyed all the Shipping Bills and
        A-5 Santosh Kumar made corrections in the Shipping Bills G
        Register as instructed by A-4 Arun Kumar and Shri
        Bindusaran."

        " •••.. In pursuance of the said criminal conspiracy A-1
        Manish Kumar Jain and A-2 R.V. Shanmugam prepared           H
    324      SUPREME COURT REPORTS               [2014] 11 S.C.R. •


A         two sets of Shipping Bills and GR Forms and exported
          some stainless steel utensils in the name of Mis Ayyappan
          Industries, Mis Shri J.S. Babu Inc. and M/s Samy Metal
          Industries. In furtherance of the criminal conspiracy, A-1
          Manish Kumar Jain and A-3 N. Rajan prepared the
B         shipping bills. The documents were filed by A-1 Manish
          Kumar Jain and A-2 R. V. Shanmugam at ICD, lrugur with ,
          the connivance of A-4 Arun Kumar who allowed the export 1
          of less quantity and entered inflated quantity in the
          Shipping Bills Registbr in conspiracy with A-5 Santhosh
c         Kumar, STA and also filed wrong GR Forms to RBI. But
          before the duty draw back was allowed, the prc>cess was
          stopped by the intervention of the Directorate General of
          Central Excise Intelligence and the accused persons
          removed/destroyed the documents available with them
D         and tried to replace the documents with the actual export
          documents by reconstruction process. While the actual
          exports was only worth Rs.3.22 crores, with eligible duty
          draw back of Rs.35,000/- by forging the Shipping Bills, GR ·
          Forms and Shipping Bills Register, the accused persons
E         attempted to claim inflated duty draw back of Rs.2.5
          crores on inflated export of Rs.22.72 crores and thereby
          attempted to cheat the Government of India."

         4. The respondents preferred application under section
    239 of Cr.P.C. seeking discharge. The special court after
F
    having considered the matter. came to the conclusion that a
    case for framing charges against the respondents under
    section 468, 471 and 201 IPC and under section 15 of the
    POC Act and under sections 132 and 136 of the Customs Act
G   was made out. The special court thus dismissed the application
    by its order dated 19.12.2008. The respondents being
    aggrieved preferred revision under section 397 read with 401
    of Cr.P.C. before the High Court. During the pendency of said
    revision the special court framed following charges against the
    accused:
H
                  •

•                 :-ATE TR. INSP. OF POLICE v. A. ARUN KUMAR                  325
                             [UDAY UMESH LALIT, J.]
    r- .;harge No. Accused
    1                                       Offences under section/s                  A

         '
         I                   A-1 to A-5     120-B r/w 511 IPC, 468, 471 and
                                            201 IPC/Section 15 of the
                                            prevention of Corruption Act, 1981
    i                                       and section 132 and 136 of the            B
                                            Custom Act.

         I                   A-1 to A-2     468 IPC

         Ill                 A-1 to A-2     468 r/w 471 IPC
                                                                                      c
         IV                  A-1 to A-3     511 r/w 420 IPC

         v                   A-1 to A-2     201 IPC

         VI                  A-4 to A-5     201 IPC
                                                                                      D
         VII                 A-1 to A-3      132 of the customs Act

         VIII                A-4 to A-5      136 of the customs Act

             IX              A-4 to A-5     15 of the Prevention of Corruption
                                            Act, 198
                                                                                      E

        5. The High Court took the view that there was nothing on
    record to justify framing of charges against the respondents. It
    was observed thus:
                                                                                      F
                  " ..... It is to be stated that this Court is also constrained to
                  state that even for raising such suspicion much less very
                  strong suspicion; the prosecution has not produced a
                  scrap of material either through statement or through any
                  other document to make out a prima facie case against               G
                  the petitioners for framing the charges."

            As regards charges under Section 15 of the POC Act, the
        High Court observed as under:

                  " .... Section 15 of the Prevention of Corruption Act, 1988,        H
    326      SUPREME COURT REPORTS                (2014] 11 S.C.R. •


A         punishment for attempt, could be invoked only in the event
          of charge framed under clause (c) of clause (d) of sub-
          section (1) of Section 13. As far as the case on hand is
          concerned, the trial court has not charged the petitioners
          for the offence under Section 13(1 )(c) or (d)."
B
      The High Court, 'thus accepted the submission that no case
  made out to frame any charges against the respondents and
  allowing the Revision by its judgment and order dated
  22.08.2011, set aside the order dated 19.12.2008 of the
C Special Court.

        6. The present appeal challenges the correctness of the
  view taken by the High Court. By way of an additional affidavit,
  the appellant placed on record, copies of relevant Shipping Bills
  and the corresponding Exchange Control declaration fonms. We
D have heard Ms. Vibha Dutt Makhija, learned senior counsel
  appearing for the appellant who invited our attention to
  documents on record to bring home the point about discrepancy
  in the total quantity of shipment and the value of shipment in two
  se~s of documents. It was submitted that the High Court was
E not right and justified in observing that there was no material
  on record at all. Mr. B.A. Khan and Mr. Ratnakar Dash, learned
  senior counsel appearing for Respondent Nos.1 and 2,
  respectively supported the view taken by the High Court. It was
  submitted by the learned counsel that there never existed two
F sets of shipping bills, that none of the witnesses deposed
  against the respondents that no duty draw back had been
  claimed at all and that the High Court was right in concluding
  that there was no material against the respondents. R,elying on
  Ganga Kumar Srivastava v. State of Bihar' it was submitted
G that no case for interference by this Court was made out.

        7. We have gone through two sets of documents which
    were filed along with an additional affidavit. By way of sample,

H 1. (2005)6SCC211.
•        STATE TR. INSP. OF POLICE v. A. ARUN KUMAR
                    [UDAY UMESH LAUT, J.]
    Shipping Bill No.000810 is for the quantity of 3568 Kgs with
    value at Rs.7,88,830 whereas the corresponding Exchange
                                                                    327


                                                                            A

    Control Declaration (GR) mentions the quantity as 23568 Kgs
    i.e. to say digit "2" stands added and the value shown is
    Rs.57,88,830 i.e. to say digit "5" stands added. In the process,
    the value was inflated which would in turn increase the amount          B
    of duty drawback multifold. The documents placed on record
    which are part of the charge-sheet, certainly raise grave
    suspicion against the respondents.

         8. The law on the point is succinctly stated by this Court in      C
    Sajjan Kumarv. CB/2 wherein after referring to Union of India
    v. Praful/a Kumar Sama!' and Dilawar Balu Kurane v. State
    of Maharashtra' this Court observed in para 19 thus:

           "It is clear that at the initial stage, if there is a strong
           suspicion which leads the Court to think that there is ground    D
           for presuming that the accused has committed an offence,
           then it is not open to the court to say that there is no
           sufficient ground for proceeding against the accused. The
           presumption of the guilt of the accused which is to be draWll
           at the initial stage is only for the purpose of deciding prima   E
           facie whether the Court should proceed with the trial or not.
           If the evidence which the prosecution proposes to adduce
           prove the guilt of the accused even if fully accepted before
           it is challenged in cross-examination or rebutted by the
           defence evidence, if any, cannot show that the accused           F
           committed the offence, then there will be no sufficient
           ground for proceeding with the trial."

        This Court the went on to cull out principles as regards
    scope of Sections 227 and 228 of the Code, which in our view            G
    broadly apply to Sections 238 and 239 of the Code as well. It
    was observed thus in para 21:
    2.    c201oi 9 sec 368.
    3.    (1909) 3 sec 4.
    4.    c2002i 2 sec 135.                                                 H
    328      SUPREME COURT REPORTS                    [2014] 11 S.C.R.       •


A         "Exercise of jurisdiction under Sections 227 & 228 of
          Cr.P.C.

          21. On consideration of the authorities about the scope
          of Section 227 and 228 of the Code, the following
          principles emerge:
B
          (i) The Judge while considering the question of framing
          the charges under Section 227 of the Cr.P.C. has the
          undoubted power to sift and weigh the evidenc19 for the
          limited purpose of finding out whether or not a prima facie
c         case against the accused has been made out. The test
          to determine prima facie case would depend upon the
          facts of each case.

          (ii) Where the materials placed before the Court disclose
          grave suspicion against the accused which has not been
D
          properly explained, the Court will be fully justified in framing
          a charge and proceeding with the trial.

          (iii) The Court cannot act merely as a Post Office or a
          mouthpiece of the prosecution but has to consider the
E         broad probabilities of the case, the total effect of the
          evidence and the documents produced before the Court,
          any basic infirmities etc. However, at this stage, there
          cannot be a roving enquiry into the pros and cons of the
          matter and weigh the evidence as if he was conducting a
F         trial.

          (iv) If on the basis of the material on record, the Court
          could form an opinion that the accused might have
          committed offence, it can frame the charge, though for
G         conviction the conclusion is required to be proved beyond
          reasonable doubt that the accused has committed the
          offence.

          (v) At the time of framing of the charges, the probative
          value of the material on record cannot be gone into but
H
•     STATE TR. INSP. OF POLICE v. A. ARLIN KUMAR                 329
                 [UDAY UMESH LAUT, J.)
        before framing a charge the Court must apply its judicial         A
        mind on the material placed on record and must be
        satisfied that the commission of offence by the accused
        was possible.

        (vi) At the stage of Sections 227 and 228, the Court is           8
        required to evaluate the material and documents on record
        with a view to find out if the facts emerging therefrom taken
        at their face value discloses the existence of all the
        ingredients constituting the alleged offence. For this limited
        purpose, sift the evidence as it cannot be expected even          c
        at that initial stage to accept all that the prosecution states
        as gospel truth even if it is opposed to common sense or
        the broad probabilities of the case.

        (vii) If two views are possible and one of them gives rise
        to suspicion only, as distinguished from grave suspicion,         D
        the trial Judge will be empowered to discharge the
        accused and at this stage, he is not to see whether the
        trial will end in conviction or acquittal."

         9. In our considered view, the material on record discloses E
    grave suspicion against the respondents and the Special Court
    was right in framing charges against the respondents. We must
    also observe that the High Court was not justified in stating that
    Section 15 of the POC Act could not be invoked in the present
    case. Since the duty draw back was not actually availed, the F
    prosecution had rightly alleged that there was an attempt to
    commit offence under the relevant clauses of Section 13(1) of
    the POC Act. It is not the requirement of law that in order to
    charge an accused under Section 15 of the POC Act he must
    also be charged either under Section 13(1)(c) of 13(1)(d) of the G
    POC Act. The assessment of the High Court in that behalf is
    not correct.

        10. In our view the instant case calls for interference by this
    Court. We, therefore, set aside the judgment and order passed         H
A
    330          SUPREME COURT REPORTS           [2014] 11 S.C.R.


    by the High Court and restore the order of the Special Court.
    The respondents thus continue to stand charged and must
                                                                       •
    consequently face the trial. However, it must be recorded that
    this Court has considered the matter only from the stand point
    whether the respondents be discharged or not and we shall not
B   be taken to have expressed any opinion on merits. The matter
    shall and must be dealt with purely on merits by the concerned
    court.

          11. We allow this appeal in the aforesaid terms.
c   Nidhi Jain                                       Appeal allowed.