N. Dhinakar, J.@mdashAccused 1,2,6,3,4 and 5 in Special C.C. No. 4 of 1997 on the file of Special Judge No. III/Additional Sessions Judge XIII, Chen-nai, are the Appellants in C.A. Nos. 972,973, 974,977,981 and 987 respectively and accused 1 to 4 in the said Special C.C. are Respondents 1 to 4 respectively in C.A. No. 1168 of 2000. In this judgment, the Appellants in the above appeals and the Respondents in C.A. No. 1168 of 2000 will be referred to as A1 to A6 in the order they were arrayed before the learned trial Judge, for the sake of convenience.
2. The accused were charged on the allegation that they, between October 1991 and December 1992, conspired and in pursuance of the said conspiracy, enabled Jaya Publications, a partnership firm, of which A1 and A2 are the partners, to purchase 3.0786 acres of land with a superstructure standing thereon measuring 2698 sq.mts and that the land was purchased below the guideline value and that the building and the machinery in the property were also purchased by undervaluing them, as a result of which, there was a wrongful gain to Jaya Publications to a tune of Rs. 3,50,91,429/-and that they also committed the offences of cheating, criminal breach of trust and an offence u/s 169 IPC and that A1 to A6 have abetted each other to commit the above offences.
3. A1 was charged u/s 120-B IPC, Sections 13(2) r/w 13(1)(c) of the Prevention of Corruption Act, 13(2) r/w 13(l)(d) of the Prevention of Corruption Act and Sections 409,169 and 420 r/w 34 IPC. A2 was charged u/s 120-B, IPC, under Sections 13(2) r/w 13(l)(c) and (d) of the Prevention of Corruption Act r/w 109 IPC, under Sections 409 r/w 109 IPC, 169 r/w 109 IPC and 420 r/w 34 IPC. A3 was charged under Sections 120-B IPC, 13(2) r/w 13(1)(d) of the Prevention of Corruption Act, 119 IPC r/w 13(2) r/w 13(1)(d) of the Prevention of Corruption Act, and under Sections 169 r/w 109, 420 and 409 IPC, A4 and A5 were charged u/s 120-B, IPC, u/s 13(2) r/w 13(1)(d) of the Prevention of Corruption Act, u/s 119 IPC r/w 13(2) r/w 13(l)(d) of the Prevention of Corruption Act and u/s 169 r/w 109 IPC. A6 was charged u/s 120-B IPC, u/s 119 IPC r/w 13(2) r/w 13(1) (d) of the Prevention of Corruption Act, and u/s 13(2) r/w 13(l)(d) r/w 109 IPC.
4. The learned trial Judge convicted A1 u/s 120-B IPC r/w 13(2) r/w 13(l)(c) and (d) of the Prevention of Corruption Act. He also convicted A1 under Sections 13(2) r/w 13(l)(c) as well as 13(2) r/w 13(l)(d) of the Prevention of Corruption Act and u/s 409 IPC, and for each charge, she was directed to suffer rigorous imprisonment for a period of three years and to pay a fine of Rs. 10,000/-. There was a further direction that in default of payment of fine, she will suffer simple imprisonment for three months. A2 was convicted by the learned trial Judge under Sections 120-B, IPC r/w 13(2) r/w 13(1)(c) and (d) of the Prevention of Corruption Act, under Sections 13(2) r/w 13(1)(c) of the Prevention of Corruption Act r/w 109 IPC under Sections 13(2) r/w 13(1)(d) of the Prevention of Corruption Act r/w 109 IPC, and u/s 409 r/w 109 IPC. A2 was also similarly sentenced. A3 to A5 were convicted under Sections 120-B, IPC r/w 13(2) r/w 13(1)(c) and (d) of the Prevention of Corruption Act and under Sections 13(2) r/w 13(l)(d) of the Prevention of Corruption Act and each of them was sentenced to suffer rigorous imprisonment for a period of three years and to pay a fine of Rs. 10,000/- in default of which, each of them was directed to suffer simple imprisonment for three months, for each charge. A6 was convicted under Sections 120-B IPC r/w 13(2) r/w 13(l)(c) and (d) of the Prevention of Corruption Act and for the said conviction, he was sentenced in suffer rigorous imprisonment for three years and to pay a fine of Rs. 10,000/- with a default sentence of simple imprisonment for three months. The learned trial Judge further directed that the sentences imposed upon the accused will run concurrently. A1 was acquitted of the charge framed u/s 420 r/w 34 IPC and also of the charge u/s 169 IPC. A2 was acquitted of the charges framed under Sections 169 r/w 109 IPC and 420 r/w 34 IPC. A3 was acquitted under Sections 119 IPC r/w 13(2) r/w 13(l)(d) of the Prevention of Corruption Act and under Sections 169 r/w 109 IPC, 420 IPC and 409 IPC. A4 and A5 were acquitted of the charges framed under Sections 119 IPC r/w 13(2) r/w 13(l)(d) of the Prevention of Corruption Act and under Sections 169 r/w 109 IPC. A6 was acquitted of the charges under Sections 119 IPC r/w 13(2) r/w 13(l)(d) of the Prevention of Corruption Act and under Sections 13(2) r/w 13(l)(d) of the Prevention of Corruption Act and 109 IPC.
5. Aggrieved by the above order of conviction and sentence, the above appeals by the accused have been preferred and the State has preferred C.A. No. 1 168 of 2000 challenging the acquittal of A1 u/s 169 IPC and the acquittal of A2 to A4 u/s 169 r/w 109 IPC and the State has not chosen to challenge the acquittal of the accused of the other charges.
6. As the appeals filed by the accused and the appeal filed by the State arise out of the common judgment in Special C.C. No. 4 of 1991. I dispose of the above appeals by the following judgment.
7. Brief facts necessary to dispose of the appeals can be summarised as follows:
The Government of Tamil Nadu, with a view to develop small scale industries, started a few production units during the First Plan period and later, followed it up by setting up more number of units during the Second and the Third Plan periods. After setting up the industrial units, the Government of Tamil Nadu, decided that for better administration of the industrial units, it must be entrusted to a corporation and therefore, Tamil Nadu Small Industries Corporation Limited (for short, TANSI), was formed in the year 1965. Sixty-four production units, which were till then run departmentally by the Directorate of Industries and Commerce, were brought under TANSI, TANSI is a wholly owned undertaking of the Government of Tamil Nadu with production units all over the state. It was a company registered under the Companies Act, 1956. TANSI has ten directors and all of them are the nominees of the Government of Tamil Nadu, including the Chairman cum Managing Director, who is an I.A.S. Officer. The company has a Memorandum of Association defining the objects for which the company was set up. Ex.P-74 is the Memorandum and Articles of Association. According to the Articles of Association, the Directors shall be appointed by the Government and that the number of Directors shall not be less than two and shall not be more than ten. During the relevant period, there were eight Directors including the Chairman cum Managing Director, who is A3 in the case. On its Board, Joint Secretary, Finance Department, Joint Secretary, Industries Department, Director of Industries and Commerce, Chief Engineer (Buildings), P.W.D., and a representative of the Tamil Nadu Electricity Board were members along with two non-official members, Prof. A.M. Srinivasan (P.W.15) and Janab Syed Abdul Gaffoor. After the Corporation was formed and industrial units were brought under the Corporation, in the year 1981-82, some of the units under the Corporation started incurring losses. Therefore, a report was sent by TANSI to the Government bringing it to the notice of the Government that some of the industrial units are consistently incurring losses. The report was discussed at various stages and G.O.MS. No. 832 dated 30.9.1985 of Industries Department was issued, which stands marked as Ex.P-21 in the case. By the said G.O., the Government decided that 8 units mentioned in the G.O. can never be made viable whatever be the measures to be adopted to achieve the objects for which they were set up in the public sector and therefore, their continuance will cause a drain on the finance of TANSI. TANSI Enamelled Wires. Guindy, and TANSI Foundry, Guindy, were two of the units which were identified as the units incurring losses, along with six other units mentioned in the said G.O. Therefore, the Government decided that TANSI close down the 8 units and explore the possibility of disposing of the properties by inviting offers through advertisements in newspapers.
8. In pursuance of the G.O. Ex.P-21. TANSI Foundry unit was officially closed on 30.6.1986 as could be seen from Ex.P-33, Board note for approval in circulation. Out of the total extent of 5.355 acres of land and 3267 sq.mts. of building in TANSI Foundry, an extent of 0.545 acres of land and 569 sq.mts of building were transferred to Tamil Nadu Corporation for Development of Women on 14.5.1987 by TANSI after collecting Rs. 12.21 lakhs. On 31.8.1988, advertisements were caused to be published for the disposal of the remaining extent of land and building and four offers were received. The offers of Ashwini Plastics and ENCOFED were recommended to the Government after the approval of the Board, but, the Government did not give approval on the ground that it will be more advantageous to TANSI to call for fresh tenders after parcelling out the land into industrial plots in accordance with the Madras Metropolitan Development Authority Rules and Regulations. TANSI also tried to dispose of the property to the sister corporations, but did not succeed as the sister corporations were not interested in buying them. The efforts of TANSI to sell the property to Directorate of Stationery and Printing also did not fructify.
9. On 14.10.1991, a meeting was held under the chairmanship of the Chief Minister, who is A1 in this case, to review the performance of TANSI. The meeting was attended by A4, the Minister for Rural Industries, A3 the Chairman cum Managing Director of TANSI. P.W.11 the Chief Secretary. P.W.14 Secretary, Industries Department and P.W.16 the Secretary. Finance Department. At the meeting, several decisions were taken as to the steps that could be taken for revival of TANSI. Ex.P-24 are the minutes of the meeting. One of the decisions taken at the meeting is that TANSI may sell the properties of its units which are defunct, and TANSI Foundry unit was identified as a defunct unit. It was also decided that TANSI must identify more such properties for sale and can send a proposal to the Government along with all details and topo sketches recommending the sale and that the vacant sites available for the running units can be plotted out into industrial plots for selling them at market value with a view to raise more resources. On 21.11.1991. advertisements were caused to be published in ''The Hindu'' and ''Indian Express'' and an advertisement was caused to be published in a vernacular daily ''Daily Thanthi" on 22.11.1991. calling for offer through tenders for the purchase of the property of TANSI Foundry. Exs.P-26. P-27 and P-28 arc the advertisements.
10. On 20.11.1991, the Board of Directors of TANSI resolved to constitute a Subcommittee consisting of the Directors for evaluating the offers received and to make recommendations for the disposal of the assets of the closed units of TANSI. The members of the sub- committee appointed by the Board arc Chairman cum Managing Director of TANSI. M. Kuttralmgam, Joint Secretary. Finance Department, who is also the Director of TANSI. Abul Hasan, the Director of TANSI and Joint Secretary. Industries Department. and C. Madakkannu. Chief Engineer (Buildings). P.W.D.. who is also the Director of TANSI The sub-committee consisting of the above persons met on 22.11.1991 to consider the offers for the disposal of TANSI Enamelled Wires unit for which, an advertisement was caused to be published on 10.10.1991. A decision was taken by the sub-committee that guideline value for the area and the value of the building as per P.W.D. norms can be obtained and thereafter, the sub-committee once again met on 2.12.1991 on which date, after considering all the offers, decided that TANSI may try once again for better offer by giving advertisements in newspapers. Ex.P-23 are the minutes of the sub-committe meeting held on 20.11.1991 and 2.12.1991. On 9.12.1991. in response to the advertisements calling for tenders for purchase of the property of TANSI Foundry. 4 tenders were received at the office of TANSI and they were opened in the presence of all the tenderers on the same day. Ex.P-29 is the offer of Java Publications. Ex.D-13 is the offer of Aban Constructions and Ex.D-15 is the offer of ENCOFED. Tamil Nadu Small Industries Development Corporation (SIDCO) also submitted a tender. Ex.D-12 is the comparative table indicating the offer made by each tenderer. Java Publications offered to purchase the entire land at the rate of Rs. 3.01 lakhs per ground. Aban Constructions offered to purchase the landed property at the rate of Rs. 1.77,325 per ground, but it offered to purchase only 1.72 acres and not the entire property. ENCOFED offered to purchase only 2000 sq.mls. of land at the rate of Rs. 1.33.333 per ground. SIDCO also submitted a tender and offered to purchase the land at Rs. 502/- per sq.mtr. All the offers were placed before the sub-committee for consideration and the sub- committee decided that A3, who is the Chairman cum Managing Director, should negotiate with Java Publications since the offer of Java Publications was Rs. 1,82,13,150/-. which is the highest of all the four bids, and then take up the matter with the Board by a note in circulation for a decision regarding the disposal of the property Ex.P-30 arc the minutes of the meeting of the sub-committee and the same was initialled by P.W.8 and A3. Thereafter, a letter. Ex.P-3''l dated 16.12.1991. was sent to Java Publications with a request to meet A3 at 4.00 p.m. on 18.12.1991. Jaya Publications sent its reply dated 18.12.1991 and the said reply is Ex.P-32. It was received at the office of A3 on 6.1.1992. Jaya Publications by their reply letter. Ex.P-32. refused to enhance the offer. Thereafter. A3 sent two letters, one to Sub-Registrar. Adyar. and, another to Sub-Registrar. Alandur with a request to them to furnish the guideline value of the property. Sub-Registrar, Alandur, by his letter dated 25.11.1991, informed A3 that in the guideline register maintained at the office of Sub-Registrar. Alandur. there is no guideline value for the property comprised in survey numbers beyond survey number 66 in block No. 5. He has also stated that block No. 5 does not fall within his jurisdiction. Sub-Registrar, Adyar. who was examined as P.W.1, sent his reply Ex.D-39 dated 22.11.1991. informing A3 that there is no guideline value for survey numbers 86.87,88.89.90.91 Part. 92 Part and 93 Part, in Block No. 5 of Adyar village, which are the properties in dispute. He added by stating that in any event, for the property in Block No. 6 of Thiru Vi Ka Industrial Estate, the value of one sq.mtr. is Rs. 305/- which works out to Rs. 7.32 lakhs per ground).
11. On 20.12.1991, a Board note for approval in circulation was circulated to the Board of Directors for consideration of the decision of the sub-committee. In the said note, Ex.P-33. it was mentioned that the value offered for the land by the highest bidder is Rs. 1,62,93,150/- which works out to about Rs. 3.01 lakhs and that though it is much lower than Rs. 7.30 lakhs which is the guideline value for Block No. 6 of Thiru Vi Ka Industrial Estate, it is marginally higher than the value fixed by the Collector under Ex.D-20 as the Collector has fixed the price per ground for the property at Rs. 3 lakhs. The note further indicated that TANSI has already decided to sell 2.52 acres of land of the same unit to Tamil Nadu Sugar Federation at Rs. 3 lakhs per ground and therefore, the price of Rs. 3.01 lakhs offered by Java Publications can be considered reasonable. It was also taken into consideration that Rs. 19.20 lakhs was offered by the highest bidder for the building and that the heavy structural available at TANSI Foundry may be useful for a heavy engineering workshop and for a buyer who docs not intend to put up a heavy engineering workshop, the value is only notional and at best, is only a scrap value. It was also slated in the note that taking into consideration the above facts and in view of non-receipt of any encouraging response to the earlier attempts and the failure of earlier attempts to sell the property to the other Tamil Nadu Government Corporations and considering the urgent financial need of TANSI. a portion of the land and building can be sold to Jaya Publications. Guindy. The members of the Board of Directors thereafter, resolved to recommend to the Government of selling a portion of the land of about 2.98 acres at the rate of Rs. 1,350/- per sq.mts. (Rs. 3,01 lakhs per ground) and that the exact extent of the land to be sold can be measured at the time of handing over and the exact amount can be collected and the buildings measuring 2698 sq.mtrs. at a cost of Rs. 19,20.000/-. The resolution was unanimously adopted and singed by A3 and the other seven Directors, namely, Jor Singh Syicm, M. Kutralingam, M. Abdul Hassan, S. Kripanidhi, C. Madakannu, A.M. Srinivasan (P.W.15). and Janab Syed Abdul Gaffoor.
12. In terms of the resolution. Ex.P-33, adopted by the Board of Directors, a proposal Ex.P-52 was sent to the Government on 30.12.1991. In the said proposal, the Government was requested to consider and decide on the sale of TANSI Foundry property. The proposal also detailed the steps taken earlier to sell the property, terms and conditions of the tender, the comparative statement of the offers received from the bidders, book value of the assets, revised book value and the valuation done by P.W.19. the design engineer of TANSI, value fixed by the Collector of Madras for this land (Ex.D-20), guideline value for the neighbouring blocks as reported by P.W.1, Sub-Registrar. Adyar, the decision of the sub-committee and the Board and the position in relation to Article 77 (a)(4) of the Articles of Association of the company. The proposal of TANSI was examined by the Government on 6.1.1992 by a circulation note which stands marked as Ex.P-48, and which was drafted by one Thulasingam at the instance of P.W.10. Under Secretary. Department of Small Industries. In Ex.P-48. a reference was made to Ex.P-52. The note file was first perused and signed by Abul Hassan, the Joint Secretary to Government, Small Industries Department, who is also the Director of TANSI. The note file was. thereafter, seen by P.W.14. Secretary, Industries Department and then by P.W.16, Secretary, Finance Department, and later it was circulated to P.W.11, Chief Secretary. The file ultimately reached A4, who signed it on 13.1.1992 and the Minister for Finance approved the proposal on 14.1.1992. Thereafter, G.O. Ms. No. 18 dated 20.1.1992 of Industries Department was issued and the said G.O., stands marked as Ex.P-35. By the said G.O., the Government approved the sale of TANSI Foundry property to Jaya Publications, Jaya Publications, in turn, was informed of the decision of the Government by Ex.P-36 with which a draft sale agreement, for getting N.O.C, from the Income Tax Department, was enclosed. An agreement for sale was entered into between TANSI and Java Publications on 4.3.1992, Ex.P-37 is the agreement for sale which was signed by A3 on behalf of TANSI and by A1 and A2 on behalf of Jaya Publications. After getting the No Objection Certificate from the Income Tax Department, the sale deed, Ex.P-17, was executed on 29.5.1992 at the office of Sub-Registrar, Adyar. P.W.1 registered the document as a conditional registration as he felt that the value for the land and building is less.
13. In the meantime, on 30.6.1992, the Board of Directors of TANSI in their 193rd meeting held on that day, took note of the fact that the actual extent of land sold was 3.0786 acres, as it was measured. Ex.P-46 is the minutes of the meeting and on 12.8.1992, P.W.7, who succeeded A3, wrote to the Government about the sale of land for information. On 30.11.1992, P.W.1 made a reference to the Special Deputy Collector (Stamps), who is A5 in the case, u/s 47-A of the Indian Stamp Act for fixing the market value of the TANSI Foundry land by his proceedings Ex.P-3. On 7.12T992, A5 by his proceedings, Ex.P-6. fixed Rs. 3.00 lakhs per ground as the market value for the TANSI Foundry land.
14. P.W.22, who was working as Secretary to Government. Small Industries Department, from June, 1996 onwards, on the directions of the Chief Secretary to Government, looked into the sale as there were number of complaints and media reports. She collected records from the department and after referring the file to the Law Department, a complaint, Ex.P-62, was given to C.B., C.I.D., on which a crime came to be registered in Crime No. 17 of 1996. Ex.P-75 is the First Information Report in the said crime. Investigation was taken up by P.W.27. He questioned the witnesses and recorded their statements and obtained sanction, after completing the investigation, the final report was filed against the accused.
15. When questioned u/s 313 Cr.P.C., the accused denied their complicity and they filed written statements.
16. A1 filed a written statement by submitting that Jaya Publications is a firm, which was constituted and registered during the year 1988 and was reconstituted in the year 1990. According to her. a Deed of Power of Attorney was executed in favour of A2 to take all decisions to look after the administration of the firm, as she was busy even before she became the Chief Minister of Tamil Nadu in 1991. She has further averred that during the tenure of her office, she was not aware of what the firm was doing and she was hard-pressed for time as she was in pre-occupation as the Chief Minister of Tamil Nadu and as the General Secretary of All India Anna Dravida Munnetra Kazhagam. She denied that she was aware of the alleged purchase of the land for the firm. She also denied her signature in the agreement for sale. She stated that she also did not sign in the Form submitted to Income Tax Department seeking No Objection Certificate from the said department. She denied that she abused her official position and that she was not informed by any of the officers about the sale. She further stated that the decision to sell the defunct units of TANSI was taken up by the Government even in the year 1985 by means of issuance of G.O. and that therefore, the decision to sell the defunct units was not her decision. She further stated that she was only a dormant partner of Jaya Publications and the day-to-day administration was looked after by A2. She also stated that the file relating to the disposal of the property was not seen by her and that she was not abetted by anyone to purchase the property nor did she join in any conspiracy for purchasing the property at a lower price. She stated that she did not violate any Code of Conduct or any provisions of any penal law and that the case had been filed against her only to achieve what could not be achieved through democratic procees.
17. A2 in her written statement also denied the allegations against her and stated that A1 was not looking after the affairs of Java Publications and that she was in-charge of the day-to-day administration of the said firm. She denied that A1 ever signed in the documents produced by the prosecution and also denied that there was conspiracy between her and the other accused with an object of purchasing the property at a lesser price. She has stated that no wrongful gain was obtained by any of the accused.
18. A3 in his written statement stated that consequent to the decision of the Government taken on 30.9.1985 as could be seen from Ex.P-21, the G.O., several attempts were made by the Board of Directors of TANSI to sell the property of Foundry unit; but. they failed in-spite of several earnest efforts. According to him. in one of the periodical review meltings chaired by A1 on 14.10.1991. functioning of TANSI came up for discussion and the decision to sell the property of the closed units taken in the year 1985. was reiterated and that the minutes of the meeting, Ex.P-24, was circulated under the signature of P.W.14. Secretary, Industries Department. According to him, to give effect to the decisions, the Board of Directors of TANSI constituted a sub-committee consisting of himself, Thiru Kuttralin-gam, Joint Secretary (Finance), Thiru Abdul Hassan, Joint Secretary (Industries) and Thiru Madakkannu, Chief Engineer (Buildings), P.W.D., to evaluate the offers and put it up to the Board with their recommendations. According to him, as per the decision of the Board, tenders were called for calling for offers for the land and building of TANSI Foundry, clearly specifying the tender conditions that the extent of land indicated in the tender documents was only approximate and that the land would be handed over to the successful tenderer as per the actual measurement at the time of handing over and the value would be collected accordingly. According to him, the tenders received were placed before the subcommittee and the sub-committee authorised him to negotiate with the highest tenderer, namely Jaya Publications and then to take up with the Board of Directors for a decision regarding the disposal of the property through a circulation note and thereafter, to address the Government for a decision. He has stated that as pes the sub-committee''s decision, he negotiated with Jaya Publications and later, the matter was placed before the Board through a circular resolution and the Board accepted the proposal and directed him to forward the proposal to the Government. He has stated that in the discharge of his official duties as Chairman cum Managing Director, Ex.P-34, the proposal, was drafted by him and was forwarded to the Government for a decision. He averred that the decision to forward the proposal to the Government was that of the Board, which was taken unanimously and it was not his individual decision. According to him. all that he did was in obedience to the decision of the Board and that he discharged his functions in a fair and impartial manner and at no point of time, favoured anybody. According to him, the decision to accept and forward the proposal was that of the Board and the responsibility is collective and not individual. He has also slated that he did not know, at the time of forwarding the proposal to the Government, that A1 is the partner of Jaya Publications and that even the evidence of P.W.15 clearly shows that there was nothing in the records to indicate, when he sent the proposal to the Government, that A1 is the partner in Jaya Publications. He has stated that Ex.P-34, the self-contained document, gives all the material facts available to him and the Board members. He submitted that the survey numbers involved in the property have not been fixed with any guideline value and the guideline register marked as Ex.P-1 does not contain the guideline value for the survey numbers which constitute the TANSI Foundry property and it was his submission that in view of the evidence of P.W.1 and P.W.17, the guideline value is fixed survey number-wise in urbau areas and the price offered by Jaya Publications cannot be compared with a non-existent guideline value to hold that there was a loss to TANSI. According to him, the fixation of market value of the land is done by the Revenue Department and that right cannot be alienated to any other department. Section 47-A of the Indian Stamp Act indicates that the Revenue Department is the competent authority to determine the market value and that even P.W.17 has admitted the said fact. According to him, the Collector of Chennai has fixed the market value of the property at Rs. 3 lakhs per ground, which was accepted by the Commissioner of Land Administration and the Government. According to him. the decision to sell the property was that of the Board and the acceptance of offer was also that of the Board and that he acted without any fear or favour in carrying out all the decisions of the Board and the sub-committee. According to him, neither he nor the Board of Directors have any say or any part to play regarding circulation of file in the Secretariat. The duties of the Secretary to Government are defined in the Tamil Nadu Government Business Rules and Secretariat Instructions Part-II and Secretariat Instructions Rule 8. According to him. if the proposal of TANSI was not acceptable for any reason whatsoever, the same could be returned to TANSI by P.W.14, Secretary. Industries Department or the objections to the proposal could have been indicated in the note put up by her to the Minister. The file was signed by the Finance Secretary and Chief Secretary and they had no objection for the proposal. He further alleged that the investigation in the case was one-sided, perfunctory and partisan and that the case had been instituted by the prosecution by suppressing several material facts and documents.
19. A4, in his written statement filed stated that the decision to sell the defunct unit was taken in the year 1985 and in the review meeting held on 14.10.1991, the said decision was only reiterated and the estimated price of sale of TANSI Foundry unit was also fixed u-nanimously by all the members who participated in the meeting. According to him TANSI was asked to follow the rules regarding the sale and after it was unanimously approved and recommended by the Board, the file was received at the Secretariat where P.W.10 put up a note which was later sent to P.W.14. He has stated that he did not know anything about the existence of G.O. Ms. No. 836 of 1991 (Ex.P-53). which was not enclosed along with the note file. Ex.P-48. According to him. there is not even a whisper about the existence of such a G.O. in the note file and that he was not also informed even orally by anyone including P.W.10 and P.W.14. According to him the note file, Ex.P-48. reached him on 13.1.1992. after the approval of Finance Secretary, P.W. 16, and Chief Secretary, P.W.11 and when P.W.14 was on leave, he discussed the matter with one Ramachandran, who assumed office as Secretary, as well as with Joint Secretary, Industries, and also with the Chairman and Managing Director, TANSI. As everyone approved the sale, he also agreed with the recommendation of the Board of Directors of TANSI and forwarded the file to the Minister for Finance and the Minister for Finance approved the sale on 14.1.1992. He slated that at that time, he did not know about the persons who are involved with Jaya Publications nor was there any indication in the note file regarding this fact and that the said fact came to light when the sale agreement was entered into on 4.3.1992 on which date, he was not in the Council of Ministers. He denied that he ever called P.W.10 and talked to her about the matter and staled that he did not ever know her. He also denied that he talked with P.W.14 about the transaction and that he did not score off the markings. "CM", or "M.F." in the note file and that these markings were not found on the date when he disposed of the note file on 13.1.1992. He has further alleged that P. Ws.10 and 14. in order to save themselves, have deposed falsely against him and according to him. he was thrown out of the post of Minister on 14.2.1992 within a month of the signing of the file. He pleaded innocence.
20. A5, in his written statement, stated that no guideline value was fixed for the case of TANSI lands and that there is no record to show that the guideline value for the survey numbers of TANSI lands was fixed at Rs. 329.05 per sq.ft. According to him, when Ex.P-3, the proposal of P.W.1 was sent to him, Ex.P-4 was not enclosed along with Ex.P-3 (Ex.P-4 is a xerox copy of the letter written by the Inspector General of Registration to the Deputy Inspector General of Registration wherein it is shown that the copies of the letter had been marked to the District Registrar and Sub-registrar, Adyar). He has stated that the comparative sale in that area and the documents registered by P. W. 1 as per the guideline value were also not enclosed and that on receipt of Ex.P-3 from P.W.1, he made independent enquiries by following the procedure laid down u/s 47-A of the Indian Stamp Act and the Rules framed thereunder and passed the considered order, Ex.P-6. According to him. he was concerned only with the fixation of the market value for the land and not for the building and according to him, while acting u/s 47-A of the said Act, he cannot take guideline value as the last word on the subject of market value and to do so will amount to surrender of his statutory obligation which is a judicial or quasi-judicial function which he has to perform. He has stated that while fixing the market value under Ex.P-6 for the land in question, he followed the principles laid down by the High Court and that there is no evidence to prove that the payment made by the purchaser to the vendor was different from what has been stated as sale consideration in the document. He has also stated that no objection was raised by the audit department while auditing the accounts of Sub-Registrar''s Office. Adyar, relating to the period of transactions of TANSI lands and that the sale consideration of TANSI lands was approved by the appropriate authority of Income Tax Department twice after which. No Objection Certificate was issued. According to him, if there had been any suspected undervaluation, the Income Tax authorities would have exercised their pre-emptive right of purchase by stepping into the shoes of the purchaser which they did not do and therefore, there is no question of under-valuation. He has further stated that the Collector, who is his immediate superior, has fixed the value per ground as Rs. 3 lakhs for the part of the TANSI lands under the same survey numbers and that the value fixed for smaller extent cannot be applied to the area of larger extent and therefore. Exs.P-70 and P-71, the two sale documents marked through P.W.1, cannot be the basis for fixing the market value of the TANSI land which is 55 times larger in extent compared to the land transferred through the sale deeds. Exs.P-70 and P-71.
21. A6. in his written statement, has stated that he has absolutely no connection with this case and had nothing to do with the proposal to sell the TANSI property. He denied that the file relating to the disposal of the property to Jaya Publications, had been dealt with or handled by him. though he was one of the Joint Secretaries in the office of the Chief Minister and stated that there is nothing in the file to indicate that it was seen by him. He also stated that there is no documentary evidence against him and that since he refused to yield to the pressure to give a statement implicating A1 in the crime, he has been chargesheeted. He further stated that the alleged statements of the witnesses implicating him in the crime given before the Magistrate and the investigating officer, had come into existence only after filing of the chargesheet in the case. He pleaded innocence and state that he has been falsely implicated in the case.
22. The accused, on their side, examined 8 persons as defence witnesses and marked 39 documents as defence exhibits.
23. The learned trial Judge, as stated earlier, on consideration of the materials, convicted and sentenced the accused, though he acquitted them of some of the charges and also of the charges under Sections 169 IPC and 169 r/w 109 IPC.
24. Now, I will set out and consider the contentions of the respective counsel and the reply made by the learned Special Public Prosecutor to the contentions.
25. The learned Senior Advocate appearing for A1 contends that though the charge against the accused is that they conspired to purchase the TANSI Foundry land below the guideline value and in pursuance of the conspiracy, the land was purchased below the guideline value and the superstructure standing thereon was also purchased below the assessed value and as a result of the above purchase, there was a wrongful loss to a tune of Rs. 3,50,91,429/-, the prosecution did not succeed in establishing the guideline value for the landed property. According to him, since the prosecution did not succeed in establishing the guideline value for the property in question, the foundation of the charge goes automatically and the other charges also have to be thrown out. He contends that once it is shown that the guideline value is not established, Exs.P-8, P-57, P-70 and P-71, the sale deeds, relied on by the prosecution, cannot be taken into consideration to arrive at a conclusion that Rs. 7.32 lakhs is the market value of the property in question and consequently, the charge mat there was a loss of Rs. 3.50 crores and odd does not stand proved. He further submits that the trial Judge has committed an error in taking Rs. 7.32 lakhs as the market value for deciding the issue and holding the accused guilty, since, according to the counsel, by substituting market value for guideline value, the trial Judge has caused great prejudice to the accused. According to him. the finding of the trial Judge that no prejudice will be caused by reading the charge after dropping the words "guideline value" cannot be supported if it is shown that prejudice was caused to the accused by taking Rs. 7.32 lakhs as the market value though the charge against the accused is that the property was purchased below the guideline value. According to him, the guideline value is the only benchmark for the charge and the loss of Rs. 3.50 crores and odd is arrived at on the basis of the guideline value and once the prosecution fails to establish that the guideline value is Rs. 7.32 lakhs per ground, the trial Judge was not justified in taking this figure as the market value to hold the accused guilty and that the defect in the charge is incurable and Section 464 Code of Criminal Procedure will not cure the defect.
26. Per contra, the learned Special Public Prosecutor contends that the property in question is located in Thiru Vi Ka Industrial Estate, Guindy. and Ex.D-37. the sketch, shows that the property falls within the jurisdiction of Kancheepuram and Madras Districts and that the sketch also shows that Block Nos. 5 and 6 fall within the jurisdiction of Madras District. According to him, for the purposes of registration of the properties, they fall within the jurisdiction of Sub-Registrar, Adyar, and the revenue jurisdiction is Mam-balam-Guindy Taluk and that the property, before it became the property of TANSI, was originally under the jurisdiction of Sub-Registrar, Alandur, and the value of the property in Block No. 6 registered during that period can be taken into consideration as the guideline value of the property in question. According to him, the guideline value is the market value and therefore, even if the prosecution did not succeed in establishing the guideline value, no prejudice was caused to the accused by the trial Judge taking into consideration the market value as the basis for finding that loss was caused to TANSI. He further submits that though the prosecution did not succeed in establishing the guideline value for the property in question, Exs.P-8, P-57, P-70 and P-71, the sale deeds, can be taken into consideration for fixing the market value of the property at Rs. 7.32 lakhs per ground and if the price of Rs. 7.32 lakhs per ground is taken as the market value, then no prejudice is caused to the accused by considering the case against them on the basis of the market value, even though, according to the charge, the property was purchased below the guideline value and the loss was caused on account of such purchase. In short, his argument is that guideline value and market value are one and the same.
27. In view of the rival contentions put forth, it becomes imperative for this Court to decide as to what is meant by "Guideline value" and as to what is meant by "Market value"
28. Let me first take up the term "Guideline value". It is not defined in Indian Stamp Act. It is as difficult as coming to grips with a greased pig. According to P.W.-1, the Sub-Registrar. Adyar, at every office of the Sub-registrar, a register is kept maintained called Guideline Register and that the guideline value of the property falling within a particular survey number will be entered therein. According to him, every year, the guideline value is fixed for the properties falling within the corporations, municipalities and panchayat unions and for the properties falling within the villages, it is fixed once in three years. To fix the guideline value of a property within the Corporation limits, the documents registered on the previous year will be considered and the highest sale consideration in the documents will be taken as a factor for fixing the guideline value. He has further deposed that impor-tant persons and general public will be enquired and guideline value is also fixed on that basis. It is his further evidence that for deciding the guideline value, the third method adopted is to take the statistics of the registration of documents in the previous two years and the average will be taken for fixing the guideline value. P.W.18 who was the Sub-Registrar during the relevant period, in his deposition, stated that the higher officials will inform the Sub-registrars about the guideline value of a property falling in each survey number and the same will be entered in the guideline register. If no guideline value is found for any survey number, the Sub-Registrar has to write to the superior officer and thereafter, the guideline value will be fixed by the said officer which will be taken as the guideline value and entered in the guideline register mentioned at the Sub-Registrar''s office. He has also stated that each survey number will have a guideline value. P.W. 1 though stated that guideline value and market value are one and the same, admitted in cross-examination that as per the rules framed under the Indian Stamp Act. the guideline value will not reflect the true market value of a property falling within a survey number. He went on to admit that as regards the properties falling within survey numbers 86,87,88,89,91,92 and 93 in Block No. 5 of Alandur village, which is the subject matter of the property in dispute, no guideline value was fixed. He further admitted that in the guideline register, Ex.P-1, maintained at his office, the guideline value is not entered as regards the property of TANSI. When he was further cross-examined, he admitted that he knew the difference between the guideline value and the market value and for certain properties, the guideline value will be more than the market value and for certain properties, the market value will be less than the guideline value. P.W.18 also admitted that for the properties falling within the above survey numbers, no guideline value is fixed and it is not entered in Ex.P-1. A combined reading of the evidence of P.W.1 and P.W.18 shows that guideline value and market value are two different concepts. P.W.27, the investigating officer, also admitted this fact in his evidence by stating that guideline value cannot be the market value for a property. It is also clear from the above evidence that for every property, the guideline value has to be fixed by the concerned authority and in this case, the guideline value for the properties was not fixed.
29. Explanation to Sub-rule 4 of Rule 3 Rules, of the Tamil Nadu Stamp (Prevention of Under-valualion of Instruments) Rules reads as follows:
The "Guidelines Register" supplied to the officers is intended merely to assist them to ascertain prima facie, whether the market value has been truly set forth in the instruments. The entries made therein regarding the value of properties cannot be a substitute for market price. Such entries will not foreclose the enquiry of the Collector u/s 47-A of the Act or fetter the discretion of the authorities concerned to satisfy themselves on the reasonableness or otherwise of the value expressed in the documents.
30. This sub rule came to be incorporated in the Rules after the judgment of this Court in
31. The witnesses have admitted that the properties in question have no guideline value and realising that there is no guideline value for the properties, though the charge was framed that the properties were purchased below the guideline value and therefore, loss was caused to TANSI, the trial Judge proceeded to consider the prosecution version by taking Rs. 7.32 lakhs as the market value per ground and held that TANSI suffered loss. The trial Judge having decided to read the charge leaving the words. "Guideline value", ought not to have taken into consideration Exs.P-8, P-57. P-70 and P-71. to hold (hat the market value of the property is Rs. 7.32 lakhs per ground, since the accused were asked to defend the charge of causing loss by purchasing the property below the guideline value, which is different from market value. It is now to be seen whether Section 464 Cr.P.C., will cure the defect. Section 464 Code of Criminal Procedure contemplates that "No finding, sentence or order by a court of competent jurisdiction shall be deemed invalid merely on the ground that no charge was framed or on the ground of any error, omission or irregularity in the charge including any misjoinder of charges, unless, in the opinion of the Court of appeal, confirmation or revision, a failure of justice has, in fact, been occasioned thereby." So. it is clear that if a failure of justice is occasioned, then the conviction becomes invalid.
32. In a case before the Supreme Court in
33. In
34. The principles laid down by the Supreme Court indicate that if there is defect in the charge, a fresh charge should be framed by the court so that the accused can be given an opportunity to defend himself on the altered or the amended charge. In this case, as stated earlier, though the trial court framed the charge against the accused that the property was purchased and that the loss was caused to TANSI because A1 and A2 purchased the property below the guideline value, it went on to dispose of the cases and found the accused guilty by holding that though the prosecution did not succeed in establishing the guideline value, the market value can be taken into consideration for finding the accused guilty. In my view, this approach of the learned trial Judge has certainly caused prejudice to the accused. If there had been an amendment to the charge mentioning the market value as the basis, then the accused could have let in evidence to show that the market value mentioned in the charge is not correct and therefore, there is violation of principles of natural justice. In
35. Since the prosecution has not established the guideline value for the properties, it becomes imperative for this Court to consider whether the price of Rs. 7.32 lakhs is the market value per ground for the properties concerned to find out whether there was any prejudice caused to the accused.
36. The term "Market Value" itself is vague, uncertain and a matter of guesswork. It is also not defined in the Indian Stamp Act. Explanation to Section 47-a of the said Act reads as follows-
For the purpose of this Act, market value of any property shall be estimated to be the price which, in the opinion of the Collector or the Chief Controlling Revenue Authority of the High Court as the case may be. such property would have fetched or would fetch, if sold in the open market on the dale of execution of the instrument of conveyance, exchange, gift, release of benami right or settlement.
Author Manohar N. Dange in his book titled "Valuation of Immovable Properties" as stated that the price that a willing purchaser pays to a willing seller for a property having due regard with its existing conditions, with all its existing advantages and with its potential possibilities when laid out with most advantageous manner, excluding any disadvantages due to the carrying out of the scheme for the purpose for which the property is transacted and this relates how the market value applies to the valuation for compulsory purchases. He has quoted the judgment rendered by Justice EVE in South Eastern Rail Company v. L.C.C., that the value to be ascertained is the value to the vendor, and not its value to the purchaser and that in fixing the value to the vendor, all restrictions imposed on the user and enjoyment of the land in his hand are to be taken into account but the possibility of such restrictions being modified or removed for his benefit is not to be overlooked and that the market price is not a conclusive test of real value. According to the author, the concept of market value has to be understood in the light of what has been explained for the purpose of land acquisition and that the market value of a property may be different in practice for different angles. According to him, the market value for a purpose is to be decided with due relations to laws and purpose of the concerned valuer and the market value, though appears to be a very simple term, is very difficult to decide under particular circumstances. He went on to add that a proper research is necessary which could determine the market value since in one case, there can be heavy demand for smaller tenements with inadequate supply and in another case, the supply may be more than adequate but without any demand. According to the author, the size of the plot has got a direct bearing on the willing purchasers in the market. The market value of a land can be fixed only by taking into consideration several factors, like potentiality of a plot for development, shape of the plot, frontage and depth, modification for depth, value in the sense of value to the owner, value in the sense of replacement cost, value in the sense of additional cost less depreciation and the most important factors which a valuer should study in respect of a property are (1) advantages to the property and (2)disadvantages to the property.
37. J.A. Parks in his book, "Principles and Practice of Valuation (Fifth Edition by D.N. Banerjee) by referring to the judgment of the Supreme Court of British Columbia (Canada) in Rowan v. City of Vancouver, wherein it was held that "a recent market price is not the best test of actual value. The whole evidence surrounding the transaction, the condition of market and other factors have to be weighed carefully", stated that valuation of immovable property is not an exact science and it is an inquiry relating to a subject abounding in uncertainties where there is more than ordinary guesswork and where it would be unfair to require an exact exposition of reasons for the conclusions arrived at. He has relied on the judgment of this Court in
38. In G. Loganathan v. S. Chenniya Chettiar (1995 (II) CTC 492), this Court observed that the Supreme Court and other courts including Madras High Court have held that guideline value is not market value and it will be dangerous to value a property according to the guideline value because there is no guarantee of truth or correctness of the data given in the guideline value. The learned Judge also relied on the judgment of the Supreme Court rendered in
39. When we consider the above principles, it is clear that guideline and market value are two different concepts and that the term "Market value" is vague, uncertain and a matter of guesswork. The market value, in my view, does not lie in the property contemplated to be purchased but lies in the mind of the person contemplating to purchase the said property. From the discussion made above, it could be seen that guideline value and market value being two different concepts, the trial Judge was not justified in taking the market value for arriving at the conclusion that there was a loss since Explanation to Section 47-A of the Stamp Act, which has been extracted above, states that the market value will be the price the property would have fetched in open market.
40. It is the case of the prosecution that the property was sold by tender and the bidders quoted their offers. The highest offer is that of Jaya Publications and under the above circumstances, unless the open tender is shown to be vitiated, the price quoted by the highest bidder has to be taken as the market value. In
Therefore, Ex.D-20, which was accepted by the Commissioner of Land Administration under Ex.P-61, cannot be rejected to say that Rs. 3.00 lakhs per ground is not the market value of the property of TANSI Foundry as Tamil Nadu Co-op. Sugar Federation purchased the entire property without putting up a superstructure, at the rate of Rs. 3 lakhs per ground. This fact stands established by Ex.D.1 the reply sent by TANSI for audit objection. Therefore, there was no justification for the trial Judge to have rejected the sale of TANSI Foundry unit to the Sugar Federation and to hold that Rs. 3 lakhs offered by the Sugar Federation does not reflect true market value. In fact, the trial Court ought to have taken into consideration the sale of 2.52 acres of land, to Tamil Nadu Co-op. Sugar Federation, which was a part of TANSI Foundry property and should have compared it with the sale of the same TANSI Foundry property to Jaya Publications as the price is Rs. 3.00 lakhs per ground in both the portions of land as they comprise in one whole portion. It cannot also be said that the Sugar Federation is a Government organisation since it is a federation formed by several co-operative societies which were registered under the Tamil Nadu Co-operative Societies Act. By no stretch of imagination, the Sugar Federation can be treated as a Government organisation and therefore, the sale of 2.52 acres of land of TANSI Foundry to the Sugar Federation is a sale to an individual and the price of Rs. 3 lakhs per ground offered for the Sugar Federation can be taken into consideration for reflecting the market value of the property. In fact, as stated earlier, the Collector by Ex.D-20 and the Commissioner of Land Administration by Ex.P-61, have also fixed the price of TANSI Foundry land at Rs. 3 lakhs per ground. So, the best benchmark can be only Rs. 3 lakhs fixed by the Collector, which was accepted by the Commissioner of Land Administration and if the said amount of Rs. 3 lakhs is taken into consideration, it cannot be said that there was a loss to TANSI, since the price of Rs. 3.00 lakhs was the market value for the same property of TANSI Foundry sold to the Sugar Federation without the Sugar Federation putting up any superstructure. A perusal of Ex.D-20 also shows that the market value of the land in survey numbers 67,68,69,70,71 and 74 in Block No. 4 of Alandur village is Rs. 1,68,649/- per ground and the said Block No. 4 is adjacent to Block No. 5 of Alandur village within which the disputed property falls. It is not the case of the prosecution that Block No. 4 of Alandur village is in another District and a perusal of the sketch, Ex.D-29, shows that Block No. 5 of Alandur village is adjacent to Block No. 4 and Ex.D-30, the rough sketch of Block No. 6 in Alandur village, also indicates that Block No. 5 is adjacent to Block No. 4. Therefore, the market value of the property in Block No. 4 is Rs. 1,68,649/- per ground and the value offered by Jaya Publications at Rs. 3 lakhs per ground for the property situate in Block No. 5 of Alandur village, which is adjacent to the property in Block No. 4, cannot be said to be undervalued. In fact, in Ex.D-20, the Collector has mentioned that he is enclosing a combined sketch with his report and the combined sketch, which is found in the office file, shows that the distance between the TANSI Foundry land in survey numbers 67,68,69,70,71 and 74 in Block No. 4 of Alandur village and the properties situate in Block No. 5 of the same village is 180 metres. Therefore, the value of the property which was adjacent to Block No. 5 and at a distance of 180 metres from Block No. 5 was only Rs. 1,68,649/- per ground and by no stretch of imagination, it can be said that the Collector committed an error in fixing the value of TANSI Foundry land at Rs. 3 lakhs per ground which is almost double the price of the land in Block No. 5 which is adjacent to Block No. 5. Ex.P-61, the report of the Commissioner of Land Administration, which is based on the report of the Collector, Ex.D-20, was marked by the prosecution as its exhibit and therefore, the prosecution cannot go back on the said assessment made by the Commissioner of Land Administration to say that the value of Rs. 3 lakhs per ground fixed by him for the TANSI Foundry property docs not reflect the true market value.
41. The contention of the learned Special Public Prosecutor, that Document No. 3152 of 1990, which stands marked as Ex.P-60, which was referred to by the Collector in his order, D-20, falls within the jurisdiction of Chengalpattu Revenue District and therefore, the Collector ought to have rejected it as not comparable, cannot be accepted, because if the property conveyed through Ex.P-60 at the rate of Rs. 3,12,613/- per ground is to be rejected as not comparable, then the market value of the disputed property can only be Rs. 1,68,649/- and not even Rs. 3 lakhs, since survey numbers 67,68,69,70,71 and 74 in Block No. 4 are only at a distance of 180 mtrs. from Block No. 5. It is to be remembered that the prosecution did not attribute any corrupt motive to the Commissioner of Land Administration who fixed the market value of TANSI Foundry land at Rs. 3 lakhs per ground nor was the Collector, who also fixed the value at Rs. 3 lakhs per ground for the TANSI Foundry property, attributed with any such motive. In fact, the trial Judge did not even consider Ex.D-21. which is a sale deed in respect of a sale of 12.5 grounds. The sale deed was executed on 17.6.1993, i.e. much later to the sale of TANSI Foundry land to Jaya Publications. In the said sale deed, the total value of the land conveyed is shown as Rs. 53,52,800/- and it works out to Rs. 4,26,640/- per ground. This value of Rs. 4,26,640/- per ground is in the year 1993 much later to the sale of TANSI Foundry land to Jaya Publications and P.W.1, Sub-Registrar, Adyar, did not raise any objection for the value shown in Ex.D-21 which means that the price of the land in the same area in the year 1993 was about Rs. 4,00,000/-and odd. Therefore, it cannot be said that the value of the disputed land is Rs. 7.32 lakhs per ground, especially when we take into consideration the extent of land purchased by Jaya Publications and the sale of 12.5 grounds under Ex.D-21. TANSI having called for tenders and the bidders having submitted their bids in the same tender and Jaya Publications having quoted highest offer and the second best being Rs. 1 crore less, TANSI could not have obtained anything better than the offer quoted by Jaya Publications. In view of the failure of the prosecution to show that the guideline value is Rs. 7.32 lakhs per ground and in view of the positive evidence as brought out through Ex.D-20 and P-61 that the value of the land of TANSI Foundry unit is Rs. 3 lakhs per ground, no sinister motive can be seen in the transaction especially when the sale was by open tender.
42. The trial Judge considered Exs.P-8. P-57, P-70 and P-71, the sale deeds and held that the market value of the property of TANSI Foundry unit can be fixed at Rs. 7.32 lakhs per ground and, therefore, there was loss to TANSI. It is to be remembered that the above four sale deeds were marked by the prosecution to show that the guideline value is Rs. 7.32 lakhs per ground and not to establish the market value. Therefore, the trial Judge was not justified in taking them into consideration to hold that the value shown in the above documents reflect the market value of the property. Be that as it may.
43. I will now consider whether Exs.P-8, P-57, P-70 and P-71 can be taken into consideration to hold that the market value of the disputed property is Rs. 7.32 lakhs per ground. According to the learned Special Public Prosecutor, Ex.P-8 is the sale deed executed by Id-hayam Publications in favour of Jaya Publications and by the said sale, 4664 sq.ft. of land was sold and the said land is in Block No. 6 of Adyar village. The learned Special Public Prosecutor contends that since the said purchase was by Jaya Publications, A1, A2 and A3 would have known that the value of the property is Rs. 7.32 lakhs per ground and therefore, purchase of the property of TANSI Foundry at Rs. 3.01 lakhs per ground has resulted in loss to TANSI. This argument is made without considering the fact that the guideline value was fixed by the Sub-Registrar for land in Block No. 6 which belongs to an individual and not that of TANSI and the extent of the property is only 4664 sq.ft. which roughly works out to 1.90 grounds. Even in the sale deed, which was executed on 22.9.1991, the executant had shown the value of the land only at Rs. 4,78,488 per ground. The sale deed does not show that the value is Rs. 7.32 lakhs per ground and when the Sub-Registrar wanted to collect additional stamp duty, it was paid without any demur and from this, it cannot be inferred that the value of TANSI Foundry land is Rs. 7.32 lakhs per ground. In fact, it is the admission of P.W. 1, in cross-examination, that the sale consideration mentioned in Exs.P-70 and P-71, cannot be taken into consideration for comparing the land value of TANSI Foundry land as the extent conveyed through Exs.P-70 and P-71 is very small and the extent of land sold to Jaya Publications by TANSI Foundry, is 53 times higher than the extent of land conveyed through Exs.P-70 and P-71. This admission of P.W. 1 indicates that if the extent of land is less, the sale consideration mentioned in the document cannot be taken for comparison and therefore, there is no justification in taking the sale consideration mentioned in Ex.P-8, which was only Rs. 4 lakhs and odd per ground and putting it against the accused by telling them that the market value of nthe property is Rs. 7.32 lakhs per ground. In fact, a learned Judge of this Court in Collector, Nilgiris v. Mahavir Plantations Pte., Ltd., ((1981) 91 L.W. 645 : AIR 1982 Mad 138), reference to the observations of a Division Bench of this Court in State of Tamil Nadu v. Chandrasekharan ((1976) 86 L.W.414 : AIR 1974 Mad 117) to the effect that the market value in a given instrument brought for registration should be taken to be correct unless circumstances exist which suggest fraudulent evasion. In Ex.P8, the sale consideration shown is only Rs. 4 lakhs and odd and that too for a smaller extent. Therefore, Ex.P-8 should not have been taken into consideration to hold that the market value of TANSI Foundry land is Rs. 7.32 lakhs per ground.
44. The prosecution also did not succeed in fixing the market value of TANSI Foundry land as Rs. 7.32 lakhs per ground, by relying on Ex.P-57, the sale deed which was executed on 30.4.1990 by Heatex in favour of Jaya Publications. By the said sale deed, an extent of 5658 sq.ft of land was sold and the property was situate in Block No. 6 of Adyar village and not in Block No. 5. The property, which was conveyed under the said sale deed, was comprised in survey numbers 55 and 56. The executant in the instrument has mentioned Rs. 76,344/- as the value per ground, but the Sub-Registrar, for the purpose of collecting additional stamp duty, fixed the value at Rs. 6 lakhs per ground and collected additional stamp duty. From nthe above document, Ex.P-57, it cannot be inferred that the value of TANSI Foundry property is Rs. 7.32 lakhs per ground since it was not shown by the prosecution that the price of Rs. 76,344/- shown as the value per ground in the said document is not the true consideration which passed between the parlies. The recitals of the document, unless it is shown to be untrue, have to be taken and if so, the consideration passed between the parties, per ground is only Rs. 76,344/-. As stated earlier, the prosecution did not establish that the said amount is not the true consideration and even the Sub-Registrar for the purpose of collecting additional stamp duty for the said sale, has fixed the value of the land at Rs. 6 lakhs per ground and not at Rs. 7.32 lakhs per ground. The extent of land being smaller, the consideration being Rs. 76,344/- per ground and the Sub-Registrar having fixed the value of the land per ground at Rs. 6 lakhs for collecting stamp duty for different survey number in different block, Ex.P-57 does not go to show that the market value of the land of TANSI Foundry unit is Rs. 7.32 lakhs per ground. Therefore, Ex.P-57 is not of any help to the prosecution to hold that the market value of the property in dispute is Rs. 7.32 lakhs per ground.
45. The other two sale deeds relied on by the prosecution are Exs.P-70 and P-71. Both the sale deeds were executed on 20.01.1992 and the vendor is the same in both the documents. Under Ex.P.70, 2583 sq.ft of land was sold and under Ex.P-71 what was conveyed was also 2583 sq.ft of land. P.W.1, in his evidence, has admitted that Exs.P-70 and P-71 cannot be taken for comparison with the disputed property as the extent of land conveyed by Exs.P-70 and P-71 is less and the ex-lent of land sold by TANSI Foundry to Jaya Publications under Ex.P-17, the sale deed, is of a larger area and larger by 53 times. In view of the admission of P.W. 1 that Exs.P-70 and P-71 cannot be taken for comparison, they stand excluded and cannot be compared to say that the value of TANSI Foundry land is Rs. 7.32 lakhs per ground. It is also to be seen from the recitals in Exs.P-70 and P-71 that the sale deeds were executed not for selling just the land, but also by the said sale, the vendor transferred his business and the licence to run the business and no break-up of figures were given valuing the land, business and the licence to run the business in the said sale deeds.
46. The discussions made above indicates that Exs.P-8, P-57, P-70 and P-71, the sale deeds cannot be taken for comparison with the present sale by TANSI to Jaya Publications but, on the contrary, the sale by TANSI Foundry of its own property, situate in the same block, to Tamil Nadu Co-op. Sugar Federation at Rs. 3 lakhs per ground, reflects the true market value, since, the Commissioner of Land Administration fixed the value of the TANSI Foundry property only at Rs. 3 lakhs per ground. The prosecution not having attributed any motive against the Collector and the Commissioner of Land Administration, cannot go back on the value fixed by them to say that the market value of the property in dispute is Rs. 7.32 lakhs especially when it has relied on Ex.P-61, the order of the Commissioner of Land Administration. Therefore, I hold that the prosecution has not succeeded in establishing the market value of TANSI Foundry land sold to Jaya Publications as Rs. 7.32 lakhs per ground and therefore, the trial Judge was not justified in substituting ''guideline value'' mentioned in the charge with ''market value'' and holding that Rs. 7.32 lakhs is the market value per ground of the land sold by TANSI.
47. The case of the prosecution is that the superstructure was also purchased at a lesser price. Ex.P-5 was marked through P.W.1 and the value shown in Ex.P-5 for the building is Rs. 18,22,654/-, which is less than the value offered by Jaya Publications. This amount of Rs. 18,22,654/- was assessed by one Sivaraman at the instance of P.W.1 after the sale. Therefore, the assessment of Sivaraman, who assessed it at the instance of P.W.1 as regards the value of the building is only Rs. 1 8.22,654/-. This assessment of Sivaraman in Ex.P-5 is not impeached. On the contrary, the prosecution relies on Ex.P-5, but, the prosecution, relying on the evidence of P.W. 19. the design engineer, and Ex.P-59 approved by the Chief Engineer, wants to show that the value of the building is Rs. 53,12,354/. P.W. 19, the design engineer, when asked to assess the value of the building, assessed it at Rs. 4,64.75,036/- as could be seen from Ex.P.58. This was modified by the Chief Engineer and it was brought down to Rs. 53,12,354/-, a far cry from the original value of more than Rs. 4 crores assessed by P.W. 19. A perusal of Ex.P-58 and P-59 shows that they do not contain any details as to how the value was finally arrived at Rs. 53,12,534/-for the building. For instance, in Ex.P-58, the value of structural columns, etc., is shown as Rs. 54,32,130/-, but in Ex.P-59, it is shown as Rs. 39,00,000/- and there is no evidence as to how these figures were arrived at. P.W.19, in his cross-examination, admitted that while assessing the building and other items, he had taken notes and they come to about 40-50 pages. The notes which P.W. 19 took into consideration to assess the building and other items and which run to more than 40 pages, ought to have been produced by the prosecution and in the absence of the production of those notes, it is difficult to accept that the value mentioned in Exs.P-58 and P-59 is the correct value for the building. In fact, Ex.P-58. is not even the original document. The prosecution did not choose to mark the origianl document and no explanation was offered by the prosecution, as to why the original of Ex.P-58 was not produced in court and marked, though admittedly, the original was available. Ex.P.58 was not certified as a true copy and how the figures in Ex.P-59 were arrived at, is a mystery. In comparison with Exs.P-58 and P-59, Ex.P-5, which was also relied on by the prosecution and which contains the assessment of Sivaraman, shows that it is a detailed calculation and indicates as to how the value for the building was arrived at. The trial Court did not even consider Ex.P-5 and give a finding as to why it should be rejected. The trial Judge simply relied on Ex.P-59 without considering Ex.P-5, which contains the value fixed by Sivaraman, who was deputed by P.W.1 to assess the value of the building. The trial Judge ought to have considered Ex.P-5 before he arrived at the conclusion that the value fixed under Ex.P-59 is the fair value. The trial Judge not having considered Ex.P-5 and not having given any reasons as to why Ex.P-5 could not be compared with Ex.P-59 and the prosecution having relied on Ex.P5, it is difficult for this Court to say that the value mentioned in Ex.P-5 for the building, etc, cannot be taken into consideration. Ex.P-5 which has more details, as compared to Exs.P-58 and P-59, which are bereft of details, shows that the value of the building is only Rs. 18 lakhs and odd and that Jaya Publications have offered more than Rs. 19 lakhs for the said superstructure. Therefore, it cannot be said that the building was purchased at a lesser value.
48. The learned trial Judge held that in another sale by TANSI Enamelled Wires, the offer given by R.R. Industries to purchase the property of the said TANSI Enamelled Wires was closed as per the decision of the sub-committee on 2.12.1991. though R.R. Industries offered Rs. 4.12 lakhs per ground. According to him, the Sub-committee decided to close the offer of R.R. Indus tries which quoted Rs. 4.12 lakhs as value per ground on the ground that it is less than the guideline value of Rs. 7.32 lakhs per ground and that TANSI should have also followed the same procedure when it decided to sell the land belonging to TANSI Foundry to Jaya Publications by closing the offer and calling for re-tender. According to the learned trial Judge, TANSI did not call R.R. Industries for enhancing the price, but closed its tender, whereas when it came to Jaya Publications, it accepted their offer, even though the value quoted by Jaya Publications is Rs. 3.01 lakhs per ground. This finding of the learned trial Judge is without considering Ex.P-23. Ex.P-23 is the minutes of the meetings of the sub-committee held on 25.11.1991 and 2.12.1991. A perusal of Ex.P-23 shows that the decision of the sub-committee dated 2.12.1991 to re-tender the property of TANSI Enamelled Wires was for getting a better price because the offer of R.R. Industries was Rs. 4.12 lakhs per ground which was found to be less than the guideline value of Rs. 305 per sq.ft (Rs. 7.32 lakhs per ground). It is to be remembered that on 2.12.1991 when the decision was taken by the sub-committee to close the tender of R.R Industries, the members of the sub-committee did not know that the value of Rs. 7.32 lakhs per ground taken as guideline value, was only in respect of a sale of land measuring about 240 sq.ft., since in Ex.D-39, the Sub-Registrar, Adyar, did not mention the extent of land conveyed. Further, the evidence discloses that it was rejected on the ground that R.R. Industries offered only Rs. 13.70 lakhs for the building as against the offer given by another bidder, who offered Rs. 19.59 lakhs. The tender of R.R. Industries was also closed since the price of Rs. 7.59 lakhs offered by them for plant, machinery, tools, etc. was lower than Rs. 21.85 lakhs as assessed. The sub-committee, by closing the tender of R.R. Industries, did not prevent them from participating and bidding at a later stage when it was retendered. The learned trial Judge, while giving such a finding, did not consider Ex.P-29 marked as an exhibit in Spl.C.C. No. 13 of 1997 on his file. The learned trial Judge having decided to take into consideration the decision of TANSI Enamelled Wires, to put it against the accused in this case, ought to have considered Ex.P29 marked in Spl.C.C. No. 13 of 1997. Had he perused Ex.P-29 in that case, the minutes of the meeting of the sub-committee held on 9.1.1992, he value for the properties and the sale deeds relied on by them, Exs.P-8, P-57, P-70 and P-71 do not show the real market value and the learned trial Judge, therefore, committed an error by taking into consideration those sale deeds as showing the market value of the property in dispute to hold that there was a loss to TANSI. Similarly, the offer made by Jaya Publications for the building is Rs. 19.20 lakhs which is more than the value assessed by one Sivaraman deputed by P.W.1 and the learned trial Judge did not take into consideration Ex.P-5 to compare it with Exs.P-58 and P-59 and by such non-comparison of Ex.P-5, has misdirected himself on a question of fact by holding that the value of superstructure and the machinery is Rs. 53,12,354/-.
49. On the discussion made above, I am unable to hold that TANSI Foundry incurred loss by selling the land at Rs. 3.01 lakhs and odd per ground. As already observed, the witnesses have admitted that there is no guideline not purchased at a lower price than the guideline value or the market value.
50. Once it is held that there is no wrongful gain or wrongful loss and if the substantive offence is not made out, then there is no conspiracy. It is, of course, true that an offence of conspiracy is independent and an accused can be convicted for the offence of conspiracy if he is found guilty.
51. The contention of the learned Special Public Prosecutor is that in Ex.P-48, A4, while putting a note on 13.1.1991, has stated that he verified with A3 and came to know that the market value of the property is Rs. 3 lakhs per ground for larger extent and that A4 could not have verified it with A3 on 13.1.1991 and therefore, conspiracy can be inferred. This argument is without taking into consideration the note made by A4. The note file shows that A4 discussed with Secretary, Industries, Joint Secretary, Industries and CMD, TANSI (A3) which means that before he made the note, he discussed the issue not only with A3, but also with other two persons and thereafter, came to the conclusion that the price is Rs. 3 lakhs per ground. A4, in his written statement filed u/s 313 Code of Criminal Procedure has also reiterated the same by stating that he contacted A3 as well as other two officers and came to know that the value of TANSI property is Rs. 3 lakhs per ground. The learned Special Public Prosecutor would have noticed that it was found by the sub-committee that on discreet enquiry at the office of Sub-Registrar, Adyar, the highest value was given as Rs. 305/- per sq.ft for a sale of land to the extent of 240 sq.ft and for the sale of land in the same industrial estate in the same block on 30.7.1991, to an extent of 28,071 sq.ft., the rate was given as Rs. 157/-per sq.ft. which works out to Rs. 3.76 lakhs per ground and for another sale of land on 30.9.1991 in Block No. 4, to an extent of 11277 sq.ft., the rate was only Rs. 153 per sq.ft. Therefore, when the sub-committee decided to close the offer of R.R. Industries, it did not know that the value of Rs. 7.32 lakhs per ground, which was taken for consideration for closing the offer of R.R. Industries, was only for a smaller extent of 240 sq.ft of land and this fact came to the knowledge of the sub-committee at a later date. TANSI Enamelled Wires, by such a decision of the sub-committee, did not loose any amount since by closing the offer of R.R. Industries and re-tendering the property of TANSI Enamelled Wires, the unit obtained better offer from Sasi Enterprises. In fact, the decision of the sub-committee to close the offer of R.R. Industries was not taken by A3 in the case in his individual capacity, but it was an unanimous decision of the sub-committee consisting of Kuttralingam, Joint Secretary, Finance Department, Abul Hassan, Joint Secretary, Industries Department and Madakannu. Chief Engineer (Buildings), P.W.D., who were the Directors of TANSI. The learned trial Judge was, therefore, not justified in taking into consideration the decision of the sub-committee dated 2.12.1991 in respect of the sale of land of another unit, to put it against the accused in this case, without taking into consideration Ex.P-29 marked in Spl.C.C. No. 13 of 1997 on his file.
52. The learned S.P.P. also relied on Ex.P.37 the agreement for sale entered between Jaya Publications and TANSI, in which the signature of A1 is found affixed. According to the learned S.P.P., though the signature of A1 is affixed, she denied it in her written statement filed u/s 313 Code of Criminal Procedure by stating that it is not her signature. According to him, the said denial can be a factor to infer that there was a conspiracy between the accused to commit the offences.P. Ws.8 and 9 gave evidence and stated that they affixed their signatures in the sale agreement. They did not specifically state that A1 affixed her signature in their presence and all that they have stated is that Al and A2 have affixed their signatures in the document. The prosecution did not prove that the signature in Ex.P-37 is the signature of A1 by sending the document to a handwriting expert. Therefore, there is no conclusive evidence that the signature found in Ex.P-37 is the signature of A1. Even if it is to be assumed that Al has signed in the agreement for sale, it cannot be taken as a factor to hold that there was a conspiracy since I have already held that the property was (S.P.P.) also found fault with the accused by submitting that after the offer was accepted, the amount was not deposited within 30 days, which is against the terms and conditions of the tender. In support of his plea, he relies on Ex.P-29, the tender submitted by Jaya Publications. This argument is also to be rejected since Ex.P-29 is only a tender form, printed and supplied by TANSI and the other bidders have also used similar forms and in the said form, the said condition is found printed. In fact, it is to be remembered that on an earlier occasion, when there was an attempt to sell the property of TANSI Enamelled Wires to Arasi Enterprises, it was given more than three years time to deposit the bid amount though the same condition prevailed. This was admitted by P.W.8 in his evidence. Therefore, nothing sinister could be inferred to hold that Jaya Publications was shown undue favour.
53. The other contention of the learned S.P.P. that Ex.P-48, the note file prepared at the Secretariat on the directions of P.W. 10, was not circulated to A1 and it was a deliberate omission on the part of A4 and therefore, it is to be inferred that there was a conspiracy between the accused. He submits that G.O. Ms. No. 836 of 1991 marked as Ex.P-53 directs that the Board of Management should exercise proper scrutiny in the approval of all tenders and purchase contracts and that prior approval of the Government should be obtained in respect of all tenders for works, equipments, etc, and all purchases whether by open tender or by limited tender enquires, etc. where the value of the contract exceeds Rs. One crore. According to him, the word ''tender'' occurring in the preamble means tender of any kind and will include the sale of land by TANSI and so, the file should have been circulated to Al for approval and by not circulating the said file to Al, the offence of conspiracy is seen made out. I am unable to accept the said argument. G.O. Ms. No. 836 of 1991 has to be read as a whole and if it is so read, it only shows that the said G.O. will be applicable only in respect of financial outgo by means of tender for works or for purchase of equipments and all purchases as noted in sub-paras (ii) and (iii) of Para 2. This G.O. was issued only as a financial discipline measure and to monitor the expenditure above Rs. 1 crore and the word ''tender'' used in the said G.O. does not mean that the sale of land by TANSI will also come under the said G.O., since it is clear from the word ''contract'' used in the said paragraph that the G.O. is applicable to the tenders for works, equipments, etc., if it is for purchase.
54. The learned S.P.P. also relied on the markings "M(RI)", "M(F)" and "C.M.", in the note file, P-48 and that according to him, it was scored off by P.W. 14 at the instance of A4. While P.W. 14 was in the box, it was sug gested to her that the above letters and scoring off were not done at the instance of A4 and they were later manipulated. I have perused Ex.P-48. If P.W.14 wanted the file to be marked to "M(RI)" meaning Minister for Rural Industries, "M(F)" meaning Minister for Finance and "C.M.", she should have mentioned the same in her note appended in Ex.P-48. She did not do so. These letters are not even found by the side of her signature; but, they are found on the left hand side after P.Ws.16 and 11 have affixed their signatures. In fact, P.W.14 admitted that when she put up her note, she only stated that it has to be circulated to A4 and P.W.11 wanted the file to be circulated to Minister for Rural Industries, Minister for Finance and Chief Minister. P.W. 14 did not make such a note and therefore, by merely finding the letters, "M(RI)". "M(F)", and "C.M." and their scoring off, this Court is unable to come to the conclusion that they were first entered and later scored off at the instance of A4. I will deal with it in a more elaborate manner when I consider the case of A.4
55. The contention of learned S.P.P. is that A5 did not follow the procedure contemplated under the Tamil Nadu Stamp (Prevention of Under-valuation of Instruments) Rules, 1968. since he did not wait for 21 days for the parties to submit their representations, before he passed the final order under Rule 7 of the said Rules. According to him, A5 ought to have waited for 21 days as contemplated under Rule 4 of the said Rules and thereafter, he should have passed a provisional order under Rule 6 and then, the final order under Rule 7. This argument also will not accrue to the benefit of prosecution to hold that there was a conspiracy. Rule 4 of the Rules contemplates the procedure. Ex.P-6 is the proceedings of A5 fixing the market value of the property and it refers to Ex.P-3, the reference made by P.W.1 on 30.11.1992. In paragraph 3 of Ex.P-6, it is stated that the notice was issued to TANSI and the purchaser, Jaya Publications on the same day. The objections of Jaya Publications dated 2.12.1992 were received on 3.12.1992. Rule 4 does not contemplate that A5 should wait for 21 days since the period of 21 days contemplated under Rule 4 is only the upper limit. A5 inspected the property on 4.12.1992 and thereafter, assessed the value of the property by passing the final order on 7.12.1992. The question of passing a provisional order will arise only in the event of A5 coming to the conclusion that the market value is more than the value mentioned in the sale deed, since by passing a provisional order under Rule 6, he can call upon the parties to submit their objections if any, to determine the market value. If the officer, A5 in this case, fixing the market value, comes to the conclusion that the market value of the property is only Rs. 3 lakhs, which is less than the market value mentioned in the instrument, then there is no necessity for A5 to pass a provisional order and call for objections. Therefore, the procedure adopted by A5 in passing the final order without passing a provisional order, cannot be put against the accused to say that there was a conspiracy. In fact, a perusal of Ex.P-6, the order of A5, shows that he had taken into consideration several factors before he arrived at the market value of the property at Rs. 3 lakhs per ground.
56. The entirety of the evidence let in by the prosecution does not establish even a single link to show that the conspirators agreed to have the property sold or the property purchased at a less price so as to cause wrongful loss or wrongful gain and that it enabled A1 and A2 to obtain the property at less than its value. There is no single link to show that the property was purchased at less than the guideline value or even below the market value. I, therefore, hold that the charge of conspiracy is not established.
57. A1 was also charged u/s 13(2) r/w 13(1)(d) and 13(1)(c) of the Prevention of Corruption Act. Section 13(l)(d)of the said Act states that "A public servant is said to commit the offence of criminal misconduct, if he (i) by corrupt or illegal means, obtains for himself or for any other person any valuable tiling or pecuniary advantage; or (ii) by abusing his position as a public servant, obtains for himself or for any other person any valuable thing or pecuniary advantage; or (iii) while holding office as a public servant, obtains for any person any valuable thing or pecuniary advantage without any public interest". The contention of the learned S.P.P. that there was wrongful loss to TANSI Foundry as the guideline value is Rs. 7.32 lakhs per ground and therefore, there was a pecuniary advantage by purchasing it at Rs. 3.01 lakhs per ground, is to be rejected in view of my earlier discussions.
58. In
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 comprehensive. 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 misuse, 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.
The Supreme Court, after considering the provision and the law on the subject, held that abuse of position must necessarily be dishonest so that it may be proved that the accused caused deliberately wrongful loss by obtaining pecuniary benefit. As I have already observed, the prosecution did not establish, by any evidence, that the first accused obtained pecuniary advantage by abusing official position as a public servant. Section 13(1)(d) of the Prevention of Corruption Act is, therefore, not made out.
59. It is now to be seen whether Section 13(l)(c) of the Prevention of Corruption Act is made out on the facts of the case. Section 13(l)(c) of the said Act states that "A public servant is said to commit the offence of criminal misconduct, if he dishonestly or fraudulently misappropriates or otherwise converts for his own use any property entrusted to him or under his control as a public servant or allows any other person so to do". So, to make out an offence u/s 13(1)(c) of the Act, the prosecution must show that the accused acted dishonestly or fraudulently. The term "dishonestly" is defined u/s 24 IPC, which states that "Whoever does anything with the intention of causing wrongful gain to one person or wrongful loss to another person, said to do that thing "dishonestly". Section 25 IPC defines the term "fraudulently" as "A person is said to do a thing "fraudulently" if he does that thing with intent to defraud but not otherwise". The words "dishonestly" and "fraudulently" in Section 13(l)(c) of the said Act are used as disjunctives as could be seen from the word "or".
60. This Court is now to consider the distinction between the term "dishonestly" and the term "fraudulently". The Supreme Court had an occasion to consider the terms "dishonestly" and "fraudulently" in
The definition of "false document" is a part of the definition of "forgery". Both must be read together. If so read, the ingredients of the offence of forgery relevant to the present enquiry are as follows: (1) fraudulently signing a document or a part of a document with an intention of causing it to be believed that such document or part of a document was signed by another or under his authority; (2) making of such a document with an intention to commit fraud or that fraud may be committed. In the two definitions, both mens rea described in Section 464 IPC. i.e, "fraudulently" and the intention to commit fraud in Section 463 have the same meaning. This redundancy has perhaps become necessary as the element of fraud is that the ingredient of other intentions mentioned in Section 463 IPC. The idea of deceit is a necessary ingredient of fraud, but it does not exhaust it; an additional element is implicit in the expressions. The scope of that something more is the subject of many decisions. We shall consider that question at a later stage in the light of the decisions bearing on the subject. The second thing to be noticed is that in Section 464 two adverbs "dishonestly" and "fraudulently" are used alternatively indicating thereby that one excludes the other. That means they are not tautological and must be given different meanings. Section 24 of the Penal Code defines "dishonestly" thus; "Whoever does anything with the intention of causing wrongful gain to one person or wrongful loss to another person, is said to do that thing "dishonestly". "Fraudulently" is defined in Section 25 thus: "A person is said to do a thing fraudulently if he does that thing with intent to defraud but not otherwise". The word "defraud" includes an element of deceit. Deceit is not an ingredient of the definition of the word "dishonestly" while it is an important ingredient of the definition of the word "fraudulently". The former involves a pecuniary or economic gain or loss while the latter by construction excludes that element. Further, the juxtaposition of the two expressions "dishonestly" and "fraudulently" used in the various sections of the Code indicates their close affinity and therefore the definition of one may give colour to the other. To illustrate, in the definition of "dishonestly" wrongful gain or wrongful loss is the necessary ingredient. Both need not exist, one would be enough. So too, if the expression "fraudulently" were to be held to involve the element of injury to the person or persons deceived, it would be reasonable to assume that the injury should be something other than pecuniary or economic loss. Though almost always an advantage to one causes loss to another and vice versa, it need not necessarily be so. Should we hold that the concept of "fraud" would include not only deceit but also some injury to the person deceived, it would be appropriate to hold by analogy drawn from the definition of "dishonestly" that to satisfy the definition of "fraudulently", it would be enough if there was a non-economic advantage to the deceiver or a non-economic loss to the deceived. Both need not co-exist". It is made clear that in the definition of the term "dishonestly", wrongful gain or wrongful loss is the necessary ingredient and that both need not exist. So too, if the expression "fraudulently" were to be held to involve the element of injury to the person or persons deceived, it would be reasonable to assume that the injury should be something other than pecuniary or economic loss. Therefore, for "dishonestly", there must be either wrongful loss or wrongful gain, but for "fraudulently", there must be an injury which is non-economic advantage to the deceiver or non-economic loss to the deceived and both cannot exist together". When the above principles enunciated by the Supreme Court are applied to the present case, it cannot be said that the accused acted "fraudulently" since there is no non-economic advantage to the deceiver or non-economic loss to the deceived. As the facts go to show that there was no wrongful gain to the accused and the consequent loss to TANSI. Hence "dishonestly" is also not established. The prosecution has to prove "dishonestly" since "fraudulently" is different and to prove that they acted "dishonestly there must be economic gain for the offence to be made out u/s 13(l)(c) of the Prevention of Corruption Act. The prosecution must also establish that A1 had control over the property of TANSI. The property of TANSI was neither a trust property nor was it under the control of the Government. It was not under the control of any individual Minister or Chief Minister. In Ex.P-17, the sale deed, it is mentioned that the vendor is TANSI and is the absolute owner of the property. Therefore, the owner of the property is TANSI. Ex.P-74, the Memorandum and Articles of Association of TANSI, shows that the property was managed by a Board of Directors nominated by the Government. The learned S.P.P. contends that sinc,e it was administered by a Board of Directors nominated by the Government, the properties of TANSI belong to the Government and therefore, Jaya Publications by purchasing the property at a lesser price, misappropriated the amount. This argument that it was a Government property will be considered by me at a later stage. I have already held that there was no economic loss to TANSI and therefore dishonesty is not seen.
61. The Supreme Court in Common Cause,
The principles enunciated by the Supreme Court in the above judgment will apply equally with all force to the facts of this case, A1. though was the Chief Minister, was not entrusted with the property of TANSI. The property was given to TANSI under the Government Grants Act, 1895, and it was managed by a Board of Directors nominated by the Government. It is an independent Corporation registered under the Companies Act. The Articles of Association of the Corporation show that TANSI is a legal entity and the property granted under Government Grants Act belong to TANSI and not to the Government. Therefore, there is no question of purchasing Government property by A1. In Ayi Gounder and Anr. v. Gabriel (1965 (1) MLJ 358). it was held by a learned single Judge of this Court that though the grant was subject to prohibition against alienation in a particular manner, the grant certainly vested the ownership of the property in the grantee and the restraint against alienation merely applied to a transaction between the parties and not to a sale in in-vitum. When we apply the above principles, it cannot be contended by the prosecution that since prior approval has to be obtained from the Government for sale of land belonging to TANSI, the property'' is that of the Government. As stated earlier, the recitals in Ex.P-17. the sale deed, show that TANSI is the absolute owner of the property and if the Government is the owner of the TANSI property, the sale deed ought to have been executed by the Chief Secretary representing the Government and if he had executed the sale deed, the title could not have been passed to Jaya Publications.
62. Section 3(42) of the General Clauses Act defines "person'' and it includes ''company''. Similarly, Section 11 IPC also defines that ''person'' includes any Company or Association, or body of persons, whether incorporated or not. In the book ''Salmond on Ju-risprudence" (Twelfth Edition - P.J. Fitzgerald), the author has stated that "Corporations are of two kinds, distinguished in English law as Corporations Aggregate and Corporations Sole. "Persons", says Coke, "are of two sorts, personal natural created of God,... and persons incorporate or politique created by the policy of man (and therefore, they are called bodies politique); and those be of two sorts, viz., either sole, or aggregate of many". A Corporation Aggregate is an incorporated group of co-existing persons, and a Corporation Sole is an incorporated series of successive persons. The former is that which has only one member at a time. Corporations Aggregate are by far the more numerous and important. Examples are a registered company, consisting of all the shareholders, and a municipal corporation, consisting of the inhabitants of the borough. Corporations sole are found only when the successive holders of some public office are incorporated so as to constitute a single, permanent, and legal person. The Sovereign, for example, is said to be a corporation of this kind at common law, while the Postmaster- General, the Solicitor to the Treasury, the Secretary of State for War. the Minister of Town and Country Planning, and the Minister of Education, have been endowed by statute with the same nature. It is essential to recognise clearly that in neither of these forms of incorporation is the legal person identical with any single human being. A company is in law something different from its shareholders or members. The property of the company is not in law the property of the share-holders. The debts and liabilities of the company are not attributed in law to its members. The company may become insolvent, while its members remain rich. Contracts may be made between the company and a shareholder, as if between two persons entirely distinct from each other. The shareholders may become so reduced in number that there is only one of them left; but he and the company will be distinct persons for all that".
63. For the offence to be made out u/s 13(l)(c) of the Prevention of Corruption Act, it must be shown that the property was under the control of any individual accused and since the property was owned by TANSI, it cannot be said that the property was under the control of A1 or A4. In
In Emperor v. Sibnath Banerji and Ors. (LR 72 IA 241), construing Section 59(3) of the Government of India Act, 1935, a provision similar to Article 166(3), the Judicial Committee held that it was within the competence of the Governor to empower a civil servant to transact any particular business of the Government by making appropriate rules. In that case, their Lordships further observed that the Ministers like civil servants arc subordinates to the Governor. In Kalyan Singh v. State of U.P. (1962) Supp (2) SCR 76), this Court repelling the contention that the opinion formed by an official of the Government does not fulfill the requirements of Section 68(c) observed: ''The opinion must necessarily be formed by somebody to whom, under the rules of business, the conduct of the business is entrusted and that opinion, in law, will be the opinion of the State Government. It is stated in the counter-affidavit that all the concerned officials in the Department of Transport considered the draft scheme and the said scheme was finally approved by the Secretary of the Transport Department before the notification was issued. It is not denied that the Secretary of the said Department has power under the rules of business to act for the State Government in that behalf. We, therefore, hold that in the present case, the opinion was formed by the State transport undertaking within the meaning of Section 68(c) of the Act, and that, there was nothing illegal in the maimer of initiation of the said Scheme".
64. In view of the above, the decision taken by the Government to sell the property even in the year 1985 or so, which was reiterated on 14.10.1991 at a meeting convened by A1, wherein P. Ws.ll, 14, 16 and others participated, cannot be taken to show that the property belonged to the Government and the decision taken was only a political decision. Therefore, TANSI is an individual entity owning a property and hence, transferred it by way of a sale and it cannot be stated that A1 misappropriated the property of TANSI by such sale to Jaya Publications.
65. On the discussions made above, I am unable to hold that there was a conspiracy among the accused and that the property was sold at a lesser price than the market value to Jaya Publications causing wrongful loss to TANSI, as conspiracy is to commit an illegal act by legal means or legal act by illegal means. The charge against the accused is that they conspired for acquiring the property at a lesser price, but this was not established by the prosecution as could be seen from the discussion made above. The means adopted by the accused is legal as it was a sale by inviting tenders as approved by the Supreme court in
66. Dr. Subramanian Swamy filed a petition in C.A. No. 972 of 2000 with a prayer to assist the prosecution and it was allowed. He thereafter, filed written submissions and also written arguments. In his written submissions, he has stated that if the property had been parcelled out as small bits into industrial plots, TANSI could have obtained better price. It is his further submission that TANSI units are not to be treated as pure commercial objects and the policy was to privatise and not to de-industrialise and that the sale of TANSI units was not intended to further public good but to fritter away public property for personal gain. He has also stated that immediate payment was not made after the proposal was executed. According to him, the value of Rs. 1.50 crores fixed for the property of TANSI Foundry at the meeting held on 14.10.1991 is a suggestive signal that diere was dishonesty on the part of A1. I have considered all the submissions. Some of the submissions found in the written arguments have already been dealt with by me elaborately. It is to be seen that TANSI did not sell the properties by parcelling them out into small plots as it was felt that by converting the property into small plots, larger area will be lost for laying roads and for earmarking certain portions of the land for other purposes as per the norms laid down by the Metropolitan Development Authority. The value of Rs. 1.50 crores, which was fixed as the estimated value for the property of TANSI Foundry unit at the meeting held on 14.10.1991, was not fixed by A1, but it was a collective decision of P. Ws.11,14,16, A3 and A4. Al cannot be faulted for the sale since it was admitted by P. Ws.ll, 14 and 16 in their evidence that it was a collective decision and no one had an objection. Therefore, no sinister motive could be seen from this against A1.
67. Merely because A1 and A2 were residents in the same house, it cannot be stated that they are partners in conspiracy and in view of my discussion that the properly was not purchased either below the guideline value or below the market value, it cannot be stated that A1 and A2 are conspirators. No clinching evidence was let in by the prosecution against A2 showing sinister conduct on her part for the inference of conspiracy against her.
68. I will take up the case of A4. He is the former Minister for Rural Industries in the Cabinet from 24.6.1991 to 14.2.1992.P. Ws.10,11,14,16 and 25 and the investigating officer, P.W.27, speak about the part played by A4.P. Ws.10, 14 and 16 speak about the proceedings comprised in the file, Ex.P-48. after the meeting on 14.10.1991, when the decision to sell 8 more units of TANSI was taken. Ex.P-48, the note file, reached the Industries Department on 6.1.1992 and after it was processed, the Under Secretary, P.W. 10 perused the same on 6.1.1992 and put up a note. It was then circulated to the Joint Secretary on 7.1.1992 and on the same day, after the Joint Secretary had seen the file, it was sent to P.W.14, Secretary, Industries Department, on 7.1.1992. She put up a note and singed it. Thereafter, the file was sent to P.W.16, Secretary, Finance Department, on 8.1.1992 who, after perusing the file, sent it. Later, it reached P.W. 11, Chief Secretary to Government, on 9.1.1992, who also signed it and sent back the file to the Industries Department on 10.1.1992. The file reached A4, Minister of Rural Industries, on 13.1.1992. He put up a note on the same day for approval of the Minister for Finance and the Minister for Finance approved it on 14.1.1992. Thereafter, the G.O., Ex.P-35, was issued on 20.1.1992 approving the sale. According to the prosecution, the part played by A4 is taking part in the meeting on 14.10.1991 and approving the office file on 13.1.1992. The participation of A4 in the meeting on 14.10.1991 and the decision taken on that day has no relevance since the decision was already taken to sell some of the sick units of TANSI as could be seen from G.O. Ms. No. 832 which stands marked as Ex.P-21. This decision was taken even in the year 1985 and even in that year, the land belonging to TANSI Foundry, which is the subject matter of this case, was one of the properties which were decided to be sold. Therefore, there was no need to convene a meeting on 14.10.1991 for the purpose of conspiracy since the property, in question, could have been disposed of without convening the meeting on 14.10.1991 as the decision was already taken in the year 1985.P. Ws.ll, 14 and 16 also participated in the meeting along with the Joint Secretary, Industries Department and the decision on 14.10.1991 was unanimous.P. Ws.ll, 14 and 16 were not even made as accused to show that there was conspiracy between them and the Joint Secretary of Industries Department was not even examined. So, the meeting held on 14.10.1991 has no significance to hold that A4 by participating in the meeting conspired to sell the property in question. In Ex.P-48, the note file, prepared at the instance of P.W.10. P.W. 10 has stated that the file may be circulated to A4. The Joint Secretary simply signed without any remarks. P.W. 14 also did not mention in her note that the file has to be circulated either to the Finance Minister or to the Chief Minister and nowhere in her note in the file, she has stated that the file should be marked to the Chief Minister. In court, she has stated in chief-examination that she wanted the file to be circulated to A4, who is the Minister for Rural Industries, Minister for Finance and to A1 who is the Chief Minister. She further stated that the letters "M(RI)" meaning Minister for Rural Industries "M(F)" meaning Minister for Finance and "C.M." were noted by her indicating that the file should be circulated to the above three persons. A suggestion was put to her that the above letters were later added and struck off in order to make it appear that though she wanted the file to be circulated to the Chief Minister, it was struck off at the instance of A4. She also gave evidence to the effect that A4 summoned her to his room and questioned her as to why she has marked the file to A1 and wanted her to score off the letters "CM." and that she pleaded her inability. As I have already stated, the letters "M(RI)", MM(F)" and "CM." written and struck off are found on the left hand column far below her signature after two others appended their signatures. If the letters "M(F)" were actually written by P.W.14, thereby indicating that the file should be circulated to the Finance Minister and that the said letters were written by P.W. 14, there was no need for A4 to mark the file to the Finance Minister after he put up his note. P.W.14 admitted that the letters "M(F)" were written by A4. which was found by the side of the signature of A4. If A4 wanted the file to be circulated to the Minister of Finance, then there was no need for him to have struck off the letters "M(F)". Therefore, the suggestion put to P.W.14 assumes significance. According to P.W.10, the Under Secretary to the Government. Department of Small Scale Industries, A4 asked her as to who marked the file to be sent to the Chief Minister and she told A4 that P.W.14 marked the file. This statement of P.W.10 given by her in evidence was not stated by her when she was examined by the investigating officer.
It is, therefore, clear that P.W.10 had come out with an improved version in court by-stating that A4 questioned her as to who wanted the file to be circulated to the Chief Minister. P.W.10 though stated that G.O. Ms. No. 836, which is Ex.P-53, was annexed to the file. Ex.P-48. it is not in the file as admitted by her. P.W.10 also did not mention anything about the said G.O. to the investigating officer stating that the said G.O. was annexed to the file, Ex.P-48. She also admitted in her evidence that the note file, Ex.P-48 did not make any mention about the said G.O. In fact, she has admitted that because the GO. was shown to her by the Public Prosecutor in court, she has mentioned about it in her evidence and therefore, her evidence that the said GO. was brought to the notice of A4 when the file was circulated, cannot be true. P.W.27, the investigating officer, admitted that GO. Ms. No. 836 of 1991 was not enclosed with the file. P.W. 14 also stated that the said G.O. was not annexed to the file. The Chief Secretary, P.W.11, has stated that if any Secreatry has an objection, then he can make his disapproval known by putting his dissent note in the file, but none of the Secretaries, i.e. P.W.11 or P.W.14 or P.W. 16 raised any objection, but approved the proposal. A4 also did the same and he does not stand on a different footing from that of P. Ws.10, 11, 14 and 16. P.W. 14 also admitted in her evidence that the decision taken at the meeting on 14.10.1991 was unanimous and all the Secretaries agreed and no one raised any objection for the decisions taken on 14.10.1991. P.W.14 deposed that she consulted P.W.16 whether the file had to be circulated to A1 after she came out from the room of A4. because A4 objected to the file being marked to A1. Though she had such a version in court that she consulted P.W. 16 about the objection of A4, she did not mention anything about this when she was examined by the investigating officer, P.W.27 and therefore, the present version of P.W. 14 is an improvement on her earlier version recorded u/s 161 Code of Criminal Procedure P.W.27 admitted that P.W.14 did not say that she consulted P.W.16. P.W. 14 admitted that she went on leave from 10.1.1992. The file was actually sent to A4 on 13.1.1992 as could be seen from the seal of the office of Minister for Rural Industries. If that be the case, P.W. 14 could not have been summoned by A4 on 13.1.1992 or thereafter as she has already left on leave even on 10.1.1992. Therefore, her evidence that she was summoned by A4 to his room and he questioned her as to why she wanted the file to be circulated to A1, cannot be true since A4 could not have summoned her before 13.1.1992 since the file itself reached him only on that day. P.W.16, Secretary. Finance Department, has stated that on 7.1.1992, P.W.14 consulted whether the file had to be circulated to Al. If this evidence of P.W.16 is taken into consideration, then P.W.14''s evidence that A4 summoned and questioned her on 13.1.1992, cannot be true since P.W.14 could not have consulted P.W.16 on 7.1.1992 as, according to P.W.14. she was summoned by A4 only after the file reached him on 13.1.1992. This evidence of P.W. 16 is at variance with the evidence of P.W.14. Therefore, the evidence of P.W. 14 that she was summoned and questioned by A4 on 13.1.1992 and that she returned from the room and consulted P.W. 16 regarding the same, cannot be true as according to P.W. 16, he was consulted by P.W.14 on 7.1.1992. If P.W.16 was consulted on 7.1.1992 by P.W. 14, then P.W. 14 would have mentioned the same in the office note file, Ex.P-48 that the file had to be circulated to A1. It is to be remembered that P.W. 14 put up her note on 7.1.1992 and if there had been a consultation with P.W. 16 on that day, she would have mentioned that the file had to be circulated to A1, but she did not do so. Therefore. 1 am unable to place any reliance upon the testimony of these witnesses on this aspect.
69. P.W.14 was examined on 17.10.1996 by the investigating officer, P.W.28. Her statement u/s 164 Code of Criminal Procedure was recorded by the Magistrate on 24.10.1996. She has stated in her evidence that she voluntarily appeared before the Magistrate and gave a statement without being sponsored by the investigating officer, though P.W.27 stated that he gave a requisition for recording her statement. P.W.11 was examined on 15.12.1996 by P.W.27 and his statement u/s 164 Code of Criminal Procedure was also recorded on 7.1.1997. He is also an accused in another crime along with P.W.16. The statement of P.W.16 was recorded u/s 164 Code of Criminal Procedure on 18.11.1996 and thereafter, his statement was recorded by the investigating officer u/s 161 Code of Criminal Procedure on 10.12.1996. The final report, in the case, was filed on 15.11.1996 which means that P.W. 16 appeared before the Magistrate on 18.11.1996. after the filing of the final report and similarly, the statement of P.W.11 was also recorded u/s 164 Code of Criminal Procedure on 7.1.1997 much after the filing of the final report. In fact, P.W. 16 was questioned by the officer and his statement was recorded u/s 161 Code of Criminal Procedure on 10.12.1996. i.e. nearly a month after the filing of the final report and after the statement was recorded u/s 164 Code of Criminal Procedure According to P.W.27, he filed a petition before the Magistrate to conduct further investigation in the case and thereafter, questioned P.W.16 and recorded his statement. This means that after the final report in the case was filed and after the registration of a crime against him, P.W.16''s statement was recorded u/s 164 Code of Criminal Procedure on 10.12.1996. P.W. 16, in cross-examination, admitted that he was questioned by the investigating officer even in September 1996, but the officer did not record his statement and he only took some notes. This shows that in September 1996, when P.W.16 was questioned by P.W.27, P.W.16 had nothing worthwhile to say and therefore, his statement was not recorded. If he had anything to say in September 1996 to the investigating officer, P.W.27, then the recording of his statement u/s 164 Code of Criminal Procedure on 18.11.1996 can only be considered as an afterthought and the statement recorded by the officer on 10.12.1996 creates a suspicion in the mind of the court that all is not well with the prosecution. It is to be remembered that except for A4, who approved the office file, Ex.P-48, none of the persons, who put their signatures, have been attributed with corrupt motive. The trial Judge took into consideration the statements of witnesses recorded under Sections 161 and 164 Code of Criminal Procedure to hold A4 guilty. It is a settled principle that a statement made to a police officer is inadmissible and a statement recorded by the Magistrate u/s 164 Code of Criminal Procedure is not a substantive piece of evidence. Therefore, I find no material against A4 to hold him guilty.
70. Now, I will take up the case of A6 to find out whether he has committed any illegal act. His name is not found mentioned in the First Information Report. Of course, it is true that the absence of the name of the accused is not a ground to reject the case against him if there are materials showing his complicity. P.W.16 is the only witness who speaks about A6. As stated earlier, P.W.16 was examined twice by the investigating officer, once in September 1996 and for the second time in December 1996. When P.W. 16 was questioned in September 1996, the officer did not record his statement. Therefore, it is to be inferred that in September 1996, P.W.16 had nothing to say against A6. According to P.W.16, he went to the Magistrate''s court on his own volition on 16.11.1996 and his statement was recorded on 18.11.1996. His statement was recorded by the Magistrate and he was questioned by the investigating officer on 10.12.1996 and at that time, it is said that he had spoken about the conduct of A6 in asking the file to be expedited. The facts extracted above speak volumes. P.W.27 also admitted that he did not question P.W. 16 as to what prompted him to go to the Magistrate and no evidence or material was produced before the court to show as to how P.W.27 came to know that P.W.16 had given a statement to the Magistrate u/s 164 Code of Criminal Procedure P.W.27 simply staled in evidence that he applied for the statement of P.W. 16 recorded by the Magistrate, on 9.12.1996 and got a certified copy of the same and that he came to know of the statement given by P.W.16 in the second week of December 1996. According to P.W. 16. A6 wanted the file to be circulated immediately as per the decision taken on 14.10.1991. The evidence of P.W. 16 that A6 wanted the file to be circulated immediately, could not have been mentioned by him in September 1996 when he was examined by the officer or otherwise, P.W.27 would have recorded his statement and implicated A6 in the crime. A6 also did not participate in the meeting held on 14.10.1991 nor did he participate in the meeting on 6.11.1991 as could be seen from Ex.P-24. As I am unable to accept the evidence of P.W.16.1 hold that A6 has not committed any offence.
71. I will now consider the case of A3, who was the Chairman cum Managing Director of TANSI from 1.8.1991 to 10.7.1992. He was convicted only under charge Nos. 1 and 11. TANSI Foundry unit was officially closed on 30.6.1986 as could be seen from the evidence of P.W.8. The extent of TANSI Foundry land is 5.355 acres and on it. there was a superstructure measuring 3200 sq.ft. Out of this, an extent of 0.545 acre of land and 569 sq.ft of building were transferred to Tamil Nadu Corporation for Developemnt of Women on 14.5.1987 after collecting a sum of Rs. 12.21 lakhs as per the Government order.
The remaining extent of land and building had to be sold and an advertisement was caused to be published on 31.1.1988. TANSI received four offers in response to that advertisement. Two offers were recommended to the Government by TANSI and they are the offers of Ash-wini Plastics for purchase of 2320 sq.mtrs., of land at the rate of Rs. 850/- per sq.mtr. which works out to Rs. 1,89,591/- per ground, and ENCOFED for purchase of 240 sq.mtrs. of land at the rate of Rs. 449/- per sq.mtr. which works out to Rs. 1,00,149/- per ground. The Government rejected those offers. TANSI did not also succeed in their efforts to dispose of major portion of the land to the Directorate of Printing and Stationery. The sister corporations also did not evince any interest to purchase the property. On 14.10.1991, the meeting presided over by A1 was convened.P. Ws. 11,14,16. A3 and A4 participated in the meeting and pursuant to the decision taken in the meeting as could be seen from the minutes, Ex.P-24, a letter, Ex.P-25 dated 13.12.1991, was sent to A3 conveying the decision of the Government approving the sale of land of the units indicated therein. Advertisements, Exs.P-26 and P-27, were caused to be published in The Hindu and Indian Express on 21.11.1991 and on 22.11.1991, an advertisement, Ex.P-28, was caused to be published in the vernacular daily. ''Daily Thanthi". Thereafter, in response to the advertisments, Jaya Publications submitted their offer, Ex.P-29, Aban Constructions submitted their offer, Ex.D-13, and ENCOFED submitted their offer. Ex.D-15. Tamil Nadu Small Industries Development Corporation Limited (SIDCO) submitted their tender. Ex.D-12 is the comparative table showing the offers made by the above 4 bidders. Jaya publications offered to purchase the land at Rs. 1350/- per sq.mtr. which works out to Rs. 3.01 lakhs and odd. Aban Constructions agreed to purchase the land at Rs. 691.65 per sq.mtr. which works out to Rs. 1,77,325/- per ground and they wanted to purchase only 1.72 acres of land, i.e. a portion of the total extent offered for sale. ENCOFED offered to purchase the land at Rs. 600/- per sq.mtr. which works out to Rs. 1,33,333/- per ground, but they offered to purchase only 2000 sq.mtrs of land. SIDCO offered to purchase the land at Rs. 502/- per sq.mtr. The offers received were placed before the sub- committee on 16.12.1991 and the minutes of the meeting is Ex.P-30. The meeting empowered A3 to call the highest tenderer and negotiate with them to increase the offer already made and he was also asked to inform the sub-committee by a note in circulation about the result of his discussion with the highest bidder. The minutes of the sub- committee were initialled by A3 and P.W.8. Thereafter, the letter, Ex.P-31 dated 16.12.1991, was sent to Jaya Publications with a request to meet A3 at 4.00 p.m. on 18.12.1991. Jaya Publications replied by their letter on 18.12.1991, which stands marked as Ex.P-32. The reply was received at the office of A3 on 6.1.1992. In the said letter, Jaya Publications have expressed their inability to enhance the price and the letter was sent by A2. Thereafter, A3 sent letters to Sub- Registrar. Adyar, and Sub-Registrar, Alandur, on 22.11.1991 requesting them to inform the guideline value of the property. Exs.D-38 and D-39. the replies of Sub-Registrar, Alandur, and Sub-registrar, Adyar, respectively, were received by A3. In Ex.D-39, Sub-Registrar. Adyar, has stated that there is no guideline value for the property in survey numbers 83 to 93 in Block No. 5 of Adyar village, but added that the value for the property in Block No. 6 of Thiru Vi Ka Industrial Estate is Rs. 305/- per sq.ft (i.e. Rs. 7.32 lakhs per ground). The Sub-Registrar, Alandur, in his letter D-38, stated that there is no guideline value for the property in Alandur village beyond survey number 66. He has also stated that Block No. 5 does not come under Alandur village. Thereafter. Ex.P-33, the Board note for approval in circulation, was circulated to all the members of the Board and the members have resolved to recommend the sale of the land and the building on the offer quoted by Jaya Publications. Thiru M. Kuttralingam and Thiru C. Madakannu also, while putting their signatures to the resolution, made a note that the matter may be recommended to the decision of the Government in terms of the minutes of the sub-committee which is marked as Ex.P-30. Janab Syed Abdul Gaf-foor. the other member of the sub-committee stated that it can be accepted without hesitation.
On 30.12.1991, a letter was sent to the Government and the said letter is Ex.P-52. The letter was received by the Government on 31.12.1991. In paragraph 20 of the said letter, the resolution adopted by the Board of Directors was extracted and in paragraph 22, the Board of Directors have requested the Government to decide on the sale of the land and building to Java Publications. After the receipt of Ex.P-5''2, the note file, Ex.P-48, of the Industries Department, was prepared by one Thulasingam at the instance of P.W. 10. in which reference is made to Ex.P-52. The note file was signed by Abul Hassan, Joint Secretary, Industries Department, who was also the Director of TANSI. He was not examined as a witness though cited in the final report. Thereafter, the file was signed by P.W.14 and then by P.W. 16 and later by P.W.11. A4 signed it on 13.1.1992 and the Minister for Finance put his signature on 14.1.1992. Thereafter, on 20.1.1992, G.O. Ms. No. 18, which is marked as Ex.P-35. was issued approving the sale and Java Publications were informed by the letter dated 21.1.1992. which is Ex.P-38". Along with the decision of the Government, a draft sale agreement was also enclosed to enable Jaya Publications to obtain No Objection Certificate from the Income Tax Department. An agreement for sale was also entered into between TANSI and Jaya Publications on 4.3.1992 and the sale deed is Ex.P-17, which was executed on 29.5.1992 at the office of Sub-Registrar, Adyar. The document was registered as a conditional registration by P.W. 1 as he felt that the value of the land and the building is less and made a reference u/s 47-A of the Indian Stamp Act. His reference is Ex.P-3. A5. Special Deputy Collector (Stamps) was asked to assess and he, by his proceedings dated 7.12.1992, Ex.P-6 assessed the value of the land at Rs. 3 lakhs per ground and the value of the building was assessed by Sivaraman. an Assistant Executive Engineer, deputed by P.W.1 at Rs. 18.22.654 as could be seen from Ex.P-5. The facts extracted above show that the decision to accept the offer of Jaya Publications was that of the Board. P.W.8, the General Manager and Company Secretary of TANSI. when cross-examined, admitted that ail the decisions were taken by the sub-committee and no decision was taken independently by A3. He also admitted that A3 only followed the decision of the sub-committee which was approved by the Board and that the offer of R.R. Industries, was brought to a close in respect of a sale of land belonging to TANSI Enamelled Wires, in pursuance of the decision taken by the sub-committee and approved by the Board of Directors. According to P.W.8. the conditions of lender were finalised even in the year 1986 and not specially drafted for this transaction.
He also admitted that A3 acted without any likes and dislikes by carrying out the decisions of the Board of Directors. P.W.8 went on to admit that even on four earlier occasions, the properties of TANSI were sold after the approval of the Government. Therefore, there is no evidence that at any point of time. A3 acted against the decision of the Board to favour Jaya Publications. The learned trial Judge found fault with A3 to hold him guilty of conspiracy on the ground that Ex.P-32. the letter of Jaya Publications, contains statements, that the land proposed to be purchased is not even and therefore, they cannot offer higher price, which is not a reason since the tender conditions at Sl. Nos. 16 and 17 state that the bidder must offer his bid after inspecting the property and that the acceptance of the said statement of Jaya Publications, by A3 shows that he has committed an offence of conspiracy. This finding of the learned trial Judge is not based on evidence since it was not A3 who accepted the reasons of Java Publications given in Ex.P-32. but it was the Board of Directors who accepted the offer. The Board, after perusal of Ex.P-33. the office note, which has extracted the reasons given by Jaya Publications for not enhancing the value, accepted the offer of Jaya Publications. Therefore, A3 cannot be blamed for the decision taken by the Board. The findings of the learned trial Judge that A3 has accepted the contents of Ex.P-32. the letter of Java Publications sent to TANSI. that the value of machinery is only scrap value for them as they have no intention of running any industry and the same was accepted by A3 as could be seen from Ex.P-34, the draft letter arc also not supported by evidence, since P.W.8 has admitted that the letter. Ex.P-34, was drafted by him and not by A3. The learned trial Judge held A3 guilty on the following reasons (1)Acccptancc of the reasons given by Jaya Publications in Ex.P-32 that the land is not even. (2)Valuc of machinery is only notional and it is only a scrap value and the words ''notional" and ''scrap value" in Ex.P.32 arc also found in Ex.P-34, the draft note, and (3) P.W. 15 told A3 that A1 cannot purchase a property, but A3 asked him not to presume that Al is going to sign the sale deed. As I have already staled, the reasons given by Jaya Publications that the land is uneven and therefore, they cannot enhance the price, was not accepted by A3 but by the Board of Directors and similarly, the draft note Ex.P-34 wherein the words "notional" and ''scrap value'' are found mentioned, was not prepared by A3 but by P.W.8 and therefore, it cannot be said that A3 simply accepted the explanation given by Jaya Publications. P.W.15 admitted that if the Board of Directors sign the resolution, it means that they have no objection and they have signed the resolution without any objection. There is no material or evidence to show that P.W.15 raised any objection for the sale of land to Jaya Publications. In fact, the note file indicates that no objection was raised by P.W.15. Though P.W.15 in chief-examination, stated that he has raised his objection on 31.12.1991, in cross-examination, he admitted that there was no Board meeting on 31.12.1991 and therefore, he could not have raised any objection on that day. At a later stage in the evidence, he stated that he raised an objection on 31.1.1992, but as could be seen from Ex.P.55, the minutes of the meeting held on 31.1.1992. the Board of Directors, on that day. have only decided to sell the land as per the approval of the Government given in G.O. Ms. No. 18 dated 20.1.1992 and therefore, P.W. 15 could not have raised an objection on 31.1.1992. after the sale was approved by the Government on 20.1.1992. Even on 31.1.1992. P.W. 15 did not raise any objection but has only signed in the resolution approving it. Therefore. P.W. 15''s claim in the evidence that he raised an objection on 31.1.1992 is not supported by any documentary evidence. P.W. 15 also admitted that the decision to sell the land to Jaya Publications is a collective decision of the Board of Directors and not the individual decision of A3 P.W.15 also stated that he did not tell the investigating officer. P.W.27. when he was examined, that he raised an objection to the transaction because he was afraid. He also stated that all members of the Board have agreed to the sale of the land for the price quoted by Jaya Publications. The evidence of P. Ws.8 and 15 therefore, indicates that the price on which the land was to be sold and the price on which the buildings were to be sold were decided by the Board of Directors, to which the Government gave approval considering all aspects as noted in the file. Ex.P-48, and A3 had no independent say or authority to decide these matters. P.W.27, the investigating officer, also admitted, in his evidence, that the Board considered Exs.D-38 and D-39. the letters sent by Sub-Registrar. Alandur, sub-Registrar. Adyar. respectively, the comparative table prepared on the basis of the offers received for the property. Ex.D-20 the report of the Collector, and Ex.P-61, the order of the Commissioner of Land Administration, and after considering all the documents, which were placed before it, the Board gave its approval. A3 did not suppress any fact or any document by not placing them before the Board of Directors. It is also to be re-membered at this stage, that P.W.17, the Additional Inspector General of Registration, has admitted that Ex.P.6, the proceedings of A5, fixing the value of the property at Rs. 3 lakhs per ground, is still in force. A perusal of the proposal, Ex.P-52 sent by TANSI to the Government shows that it contains details as to the steps taken by TANSI to dispose of the properties of its defunct unit and how they were not able to succeed on account of one factor or other The whole exercise carried out by the Board of Directors in trying to dispose of the property of the defunct unit of TANSI has been graphically detailed in the proposal and the said proposal did not suppress any fact. It is also to be remembered that though the sub-committee consisted of other Directors, they were not even examined in court as witnesses to show that the decisions of the sub-committee were influenced by A3. In fact, it had come out in evidence that the decision of the sub-committee was accepted by the Board of Directors without raising any objection. Therefore, A3 cannot be found fault for the decision of the Board of Directors. In view of the discussion made above, I am unable to hold A3 guilty of the offences for which he was charged.
72. I will now take up the case against A5. He was the Special Deputy Collector (Stamps) during the relevant period. The case of the prosecution is that when the sale deed. Ex.P-17. was presented for registration before P.W.1, it was registered as a conditional registration and it was referred u/s 47-A of the Stamp Act to A5 for finding out the market value. P.W.1 sent Ex.P-3 to A5. A perusal of Ex.P-3 shows that it is only a printed form and the columns of which were filed by P.W.1. Section 47-A of the said Act mandates that if the Registering authority has a reason to believe that the market value of the property, which is the subject matter of conveyance, exchange, gift, release of benami right or settlement, has not been truly set forth in the instrument, he may, after registering such instrument, refer the same to the Collector for determination of the market value of such property and the proper duty payable thereon. Therefore. P.W.1 who was under legal obligation, should have given reasons as to his belief that there was an attempt on the part of the parties to undervalue the subject matter of transfer. PW.1 did not give any reasons as to why he believed that the property was under-valued. Column No. 12 of Ex.P-3 shows that he has fixed the guideline value of the landed property at Rs. 4,42,13,533/-. We have to now remember the evidence of P.W.1 that for the property in dispute, there was no guideline value fixed by the parties and was also not entered in the guideline register maintained at his office. The registering authority cannot refer the matter to the Collector for determination of the market value merely because the consideration shown in the deed is less than the guideline value. Ex.P-1 is the guideline register and in the said register, for Block No. 5 of Alandur village, the guideline valve is entered for survey numbers 1 to 22 and for survey numbers 86,87,88,89,91,92 and 93, the guideline value is not given. Therefore, it is difficult to understand as to why P.W.1 felt that the value shown in the instrument is less than the guideline value. P.W.1 and P.W.18, who succeeded P.W.1 and P.W.27, the investigating officer, admit that no guideline value for TANSI lands is found mentioned in the guideline register. After the reference was made. A5. by his proceedings dated 7.12.1992. fixed the value of the properly at Rs. 3 lakhs per ground after issuing notice to the concerned parties. The allegation against A5 is that he has fixed the value at a lower rate and thereby enabled Java Publications to purchase the property below the guideline value. A5 in his proceedings had given reasons as to why he has fixed the value of the property at Rs. 3 lakhs per ground. He took into consideration the fact that the property was purchased in open lender under sealed tender system and the value offered by Jaya Publications is more than Rs. 1 crore of the next highest bidder and that No Objection Certificate was also obtained from the appropriate authority of the Income Tax Department. He also took into consideration that for large extent of land as in this case, genuine consideration and reduction have to be given for the front, middle and rear portions of the property and that Thiru Vi Ka Industrial Estate is a big complex in Madras city. A portion of the industrial estate falls within the jurisdiction of Chengal-pattu-M.G.R. District and it shows the extent of the estate. In the vast extent of about 2 to 3 sq. kms, the land purchased by Java Publications is 3/4 km away from Grand South Trunk road and King Institute is at the eastern boundary of the land in the industrial estate. The land value is only Rs. 2 lakhs per ground in the front portion and about Rs. 3 lakhs per ground in the extreme north because the threat of inundation of river Adyar during flood season is always there. According to him, in a number of cases, the land value in the estate was determined based on various factors, such as loca-tional advantage and disadvantages. Ex.P-6 further shows that he has taken into consideration the verdicts of Madras High Court which say that the guideline is not final and it is only a preliminary exercise to find out the real market value of a particular property. He had also compared the other sales and then arrived at the value.
73. Ex.D-10 is a sale deed and by the said sale deed, an extent of 6995 sq.ft of land in Block No. 6 of Adyar village, which roughly works out to 2.78 grounds, was sold on 12.10.1990. The vendor is Paramount Pollution Control Limited and it was purchased by Rockfort Publications Private Limited. In the said sale deed, the value per ground is shown as Rs. 99,984/-. It was referred u/s 47-A of the Stamp Act and A5 fixed the value of the property at Rs. 2,17,008/- per ground.
74. On another occasion, document No. 1442 of 1991 was referred u/s 47-A of the Stamp Act. The sale was by Wazir Begum to Capro Industries. Though this transaction, an extent of 5393 sq.ft of land was sold which is above two grounds. The executant in the deed has shown the value of land per ground as Rs. 1,89,120/-. A5 fixed the value at Rs. 3 lakhs per ground. In his proceedings Ex.P-6, A5 has referred to this document, but only made a factual error in stating that the property was sold to SIDCO.
75. Ex.P-68 is another sale deed registered on 31.5.1991 and the sale was by IN-DOSAC Industries to Abida Hussain and Family. The extent of property transferred is 5538.5 sq.ft which is above two grounds. The executant has valued the land at Rs. 2,07,984/-per ground and on being referred u/s 47-A of the said Act, A5 by his proceedings, Ex.P-69, fixed the value of the land at Rs. 2,78,184/-per ground.
76. All the above three sale deeds relate to the sale of property falling within Block No. 6 at Adyar village. The properties covered by the above documents are smaller in extent, the maximum being 2.78 acres, which was conveyed under Ex.D-10 and even for that property, A5 has fixed Rs. 2,17,008/- as value per ground and therefore, the value fixed by A5 at Rs. 3 lakhs per ground for the property in dispute, cannot be stated to be an undervaluation.
77. The learned S.P.P. contends that A5 did not take into consideration Exs.P-8, P-57, P-70 and P-71, when he fixed the value for the disputed property at Rs. 3 lakhs per ground. I have already discussed about Exs.P-8, P-57, P-70 and P-71 and found, on the basis of the evidence, that they are not comparable documents and do not reflect the true value of the property in dispute. I have also considered Ex.D-20, the letter written by the Collector, in which he has fixed the value of the property, Ex.P-61, the letter written by the Commissioner of Land Administration fixing the value of the disputed properly at Rs. 3 lakhs per ground, and also Ex.D-21. I have already stated that P.W.1 himself admitted that Exs.P-70,71 and 8 are not the comparable sales and further it is seen from the evidence that the land conveyed under Ex.P-8 is close to 100 feet Road and the extent is also smaller as is in the case of Ex.P-57.
78. A persual of Ex.P-6, the proceedings of A5, shows that he had taken into consideration the factors which ought to have been borne in mind. In Chimanlal v. Spl. Land Acquisition Officer, Poona (AIR 1988 SC 1652), the Supreme Court held that genuine instances have to be identified taking into consideration the proximity from time angle and the proximity from situation angle and that once the instances are identified, it will provide the index of market value and the price will be reflected in the instances. The balance sheet of plus and minus factors can be drawn for fixing the market value. The proceedings of A5, Ex.P-6 are self-explanatory and he had in detail discussed all the factors and then fixed Rs. 3 lakhs per ground as the market value of the property in dispute. Further, the contention of the learned S.P.P. that A5 did not take into consideration the documents, Exs.P-8, P-57, P-70 and P-71 cannot also be a reason to reject Ex.P-6. Ex.P-8 is document No. 3285 of 1991 and Ex.P-57 is document No. 4640 of 1990. It would have been impossible for A5 to have gone to the office of the sub-registrar to look at all the documents registered at the office to lay his hands on 3285th document of 1991 and 4640th document of 1990. Similarly, Ex.P-4, on which the prosecution places reliance, to show that the market value of the property in survey numbers 55 and 56 in Block No. 6 is Rs. 6 lakhs per ground, cannot be taken into consideration for holding that the value of land in Block No. 5 is Rs. 6 lakhs or above Rs. 6 lakhs per ground, Ex.P-4 is only a xerox copy of a letter alleged to have been addressed by the Inspector General of Registration to the Deputy Inspector General of Registration and it is dated 23.11.1990. The prosecution did not produce the original of Ex.P-4 and Ex.P-4 was marked subject to the condition that the original will be produced. It was never produced. There is no explanation as to why the original is not produced. A perusal of Ex.P-4 shows that it has been certified as a true copy which means that the original must have been available for the officer to have perused the original to certify it as true copy Assuming for a moment, that Ex.P-4 can be looked into even though the original was not produced, I am of the view that Ex.P-4 has no statutory force as it was only a letter addressed by one officer to his subordinate. It also relates to survey numbers 55 and 56 of Block No. 6 of Adyar village and in Ex.P-1, the guideline register maintained at the office of the Sub-Registrar. Adyar, P.W.1, the guideline value for survey numbers 55 and 56 is not seen entered. Therefore, the circumstances under which Ex.P-4 came to be written by the Inspector General of Registration, are not known to the court. A5 also did not have knowledge of Ex.P-4. Ex.P-68, the sale deed relating to a sale of land in Block No. 6, is dated 31.5.1991. It was referred to A5 for fixing the market value u/s 47-A of the Stamp Act. Thereafter. A5 fixed the market value of the property covered under Ex.P-68 at Rs. 2,78,184/- per ground. It was not fixed at Rs. 6 lakhs, though the property was situate within Block No. 6 of Advar village. A copy of Ex.P-4 was marked through P.W.1. P.W.1 did not send Ex.P.4 along with Ex.P-3 to A5 for him to be put on notice that the value of the property comprised in survey numbers 55 and 56 in Block No. 6 of Adyar village is Rs. 6 lakhs. Ex.P-68 was referred to A5 u/s 47-A of the Stamp Act and by his proceedings. Ex.P-69. A5 fixed the value of the property covered under the said sale deed at Rs. 2,78,184/- per ground. He did not fix it at Rs. 6 lakhs. Ex.P-4 is dated 23.11.1990 and Ex.P-68 dated 31.3.1991 was registered only on 4.6.1991. The proceedings of A5, Ex.P-69 regarding Ex.P-68 is dated 4.10.1991. The above dates show that Ex.P-4 is earlier in point of time and A5 had no knowledge of the said letter. If it is to be stated that A5 has undervalued the property covered under Ex.P-68. it is also to be stated that he has been consistent in under-valuing the properties. In fact. P.W.1 has admitted that A5 is not bound by the guideline value while assessing the value of the property and that he need not even accept the value mentioned in Exs.P-8. P.57, P-70 and P-71 as the properties conveyed under the above sale deeds are smaller in extent.
79. The trial Judge took into consideration the document No. 1442 of 1991 which is found referred in Ex.P-6, the proceedings of A5. The trial Judge proceeded on the basis that A5 committed an error in taking into consideration the sale to SIDCO for fixing the market value of the property in dispute, though, in fact document No. 1442 of 1991 is not the sale of SIDCO. Though the learned trial Judge referred to document No. 1442 of 1991 in his judgment, he did not question A5 u/s 313 Code of Criminal Procedure by asking him as to how he had taken into consideration that document, which was only a sale to SIDCO for fixing the market value of the property in dispute. This shows that the trial Judge considered the materials which were extraneous and A5 had no opportunity of explaining the circumstances which were put against him in the judgment and this being the sole consideration for his conviction, A5 was certainly prejudiced by such non-questioning.
80. I have already held that A5 followed the procedure contemplated under T.N. Stamp (Prevention of Under-valuation of Instruments) Rules, 1968, and the contention of the learned S.P.P. that he ought to have waited for 21 days cannot be accepted since the period of 21 days contemplated under the Rules is only the upper limit and that A5 is also not duty bound to pass a provisional order if the value of the property is fixed which is less than the value mentioned in the instrument. The provisional order is to be passed only in the event of the officer fixing the price at a higher rate so as to give an opportunity to the parties to put forth their objections to enable the officer to consider them and then pass the final order under Rule 7 of the said Rules.
81. On the materials. 1 find that A5 acted properly and no fault could be placed at his doorstep to hold him guilty.
82. Now, I will take up C.A. No. 1168 of 2000. The said appeal is filed by the State against the acquittal of A1 who was charged u/s 169 IPC and against the acquittal of A2 to A4 who were charged u/s 169 r/w 109 IPC. A6 in the case, who was the Joint Secretary in the office of Chief Minister was not even charged before the trial Court u/s 169 r/w 109 IPC. A-5 though was charged u/s 169 r/w 109. IPC, was acquitted. This appeal does not challenge his acquittal and it challenges only the acquittal of A1 and A2 to A4.
83. The learned S.P.P. arguing the appeal, strenuously contends that the words "legally bound to do" occurring in Section 169 IPC is defined in Section 43 IPC and that by purchasing the Government property, A1 violated Code of Conduct, which is marked as Ex.P-15 in the case. Clause 2(b) of the Code of Conduct reads as follows: "After taking office, and so long as he remains in office, the Minister shall refrain from buying from, or selling to, the Government any immovable property except where such properly is com-pulsorily acquired by the Government in the usual course". Relying on this clause, it is submitted that A1 being the Chief Minister, ought to have refrained from purchasing the property of TANSI, which according to the learned S.P.P. is a Government property. He has relied on Articles 154,162, 164 and 166 of the Constitution of India to buttress his arguments. Article 154 deals with the executive power of the State, Article 162 deals with the extent of executive power of the State and Article 164 deals with the provisions relating to the Minister. Article 166 states that all executive actions of the Government of a State shall be expressed to be taken in the name of the Governor and sub- Article(2) of Article 166 reads that orders and other instruments made and executed in the name of the Governor shall be authenticated in such manner as may be specified in rules to be made by the Governor, and the validity of an order or instrument which is so authenticated shall not be called in question on the ground that it is not an order or instrument made or executed by the Governor. According to the learned S.P.P., Articles 298 of the Constitution of India recognises the executive power of the Union and of each Slate to carry on any trade or business and to the acquisition, holding and disposal of properly and making of contracts for any purpose. Therefore, the Government is running trade by floating TANSI and running the business. According to him, therefore, the properly is the Government property and continues to be the Government property. The learned Senior Advocate appearing for the first Respondent contents that Code of Conduct is not law and it has no statutory force and therefore, the public servant is not legally bound by that. In support of his plea, he also relies on the evidence of P.W.11 who admitted in his evidence that the Code of Conduct. Ex.P-15. has no legal sanctity. According to the Senior Counsel, the contention that Code of Conduct was issued by the orders of the Government under Article 166 of the Constitution, is not correct.
84. The learned S.P.P. in support of his contention, relies on the judgment rendered in
85. The question to be decided is whether a Corporation is an extended arm of the Government and whether the property of a Corporation is the property of the Government. In
A Corporation may be created in one of two ways. It may be either established by statute or incorporated under a law such as the Companies Act 1956 or the Societies Registration Act 1860. Where a Corporation is wholly controlled by Government not only in its policy making but also in carrying out the functions entrusted to it by the law establishing it or by the Charter of its incorporation, there can be no doubt that it would be an instrumentality or agency of Government. But, ordinarily, where a corporation is established by statute, it is autonomous in its working, subject only to a provision, often times made, that it shall be bound by any directions that may be issued from time to time by Government in respect of policy matters. So, also a corporation incorporated under law is managed by a hoard of directors or committee of management in accordance with the provisions of the statute under which it is incorporated. When does such a corporation become an instrumentality or agency of Government? Is the holding of the entire share capital of the corporation by Government enough or is it necessary that in addition, there should be a certain amount of direct control exercised by Government and, if so, what should be the nature of such control? Should the functions which the corporation is charged to carry out possess any particular characteristic or feature, or is the nature, of the functions immaterial? Now, one thing is clear that if the entire share capital of the corporation is held by Government, it would go a long way towards indicating that the corporation is an instrumentality or agency of Government. But, as it quite often the case, a corporation established by statute may have no shares or shareholders, in which case, it would be a relevant factor to consider whether the administration is in the hands of a board of directors appointed by Government, though this consideration also may not be determinative, because even where the directors are appointed by Government, they may be completely free from governmental control in the discharge of their functions. What then are the tests to determine whether a corporation established by statute or incorporated under law is an instrumentality or agency of Government? It is not possible to formulate an all-inclusive or exhaustive test which would adequately answer this question. There is no cut and dried formula which would provide the correct division of corporations into those which are instrumentalities or agencies of Government and those which are not.
The analogy of the concept of State action as developed in the United States may not. however, be altogether out of place while considering this question. The decisions of the courts in the United States seem to suggest that a private agency, if supported by extraordinary assistance given by the State, may be subject to the same constitutional limitations as the State. Of course, it may be pointed out that the State''s general common law and statutory structure under which its people carry on their private affairs, own property and contract, each enjoying equality in terms of legal capacity, is not such state assistance as would transform private conduct, into State action''. But, if extensive and unusual financial assistance is given and the purpose of the Government in giving such assistance concides with the purpose for which the corporation is expected to use the assistance and such purpose is of public character, it may be a relevant circumstance supporting an inference that the corporation is an instrumentality or agency of Government. The leading case on the subject in the United States is Kerr. v. Eneck Pratt Free Library, 149 F 2d 212. The Library system, in question in this case, was established by private donation in 1882, but by 1944, 99 per cent of the systems budget was supplied by the city, title to the library property was held by the city employees were paid by the city payroll officer and a high degree of budget control was exercised or available to the city Government. On these facts, the Court of Appeal required the trustees managing the system to abandon a discriminatory admission policy for its library training courses. It will be seen that in this case, there was considerable amount of State control of the library system in addition to extensive financial assistance and it is difficult to say whether, in the absence of such control, it would have been possible to say that the action of the trustees constituted State action. Thomas P. Lewis has expressed the opinion in his article on ''The meaning of State Action'' (60 CLR 1083) that in this case" it is extremely unlikely that absence of public control would have changed the result as long as 99% of the budget of a nominally private institution was provided by Government. Such extensive gover-mental support should be sufficient identification with the Government to subject the institution to the provisions of the Fourteenth Amendment". It may, therefore, be possible to say that where the financial assistance of the State is so much as to meet almost entire expenditure of the corporation, it would afford some indication of the corporation being impregnated with governmental character. But, where financial assistance is not so extensive, it may not by itself, without anything more, render the corporation an instrumentality or agency of Government, for there are many private institutions which are in receipt of financial assistance from the State and merely on that account, they cannot be classified as State agencies. Equally, a mere finding of some control by the Stale would not be determinative of the question "since a State has considerable measure of control under its police power over all types of business operations". But a finding of Stale financial support plus an unusual degree of control over the management and policies might lead one to characterise an operation as State action". Vide
There is also another factor which may be regarded as having a bearing on this issue and it is whether the operation of the corporation is an important public function. It has been held in the United States in a number of cases that the concept of private action must yield to a conception of State action where public functions are being performed. Vide Arthur S. Millar, "The Constitutional Law of the ''Security State'', (10 SLR 620 at p.664). It was pointed out by Dougles, J., in E.S. Evans v. Charles E. Newton (1966) 382 US 296 : 15 L Ed 2d 373 that "when private individuals or groups are endowed by the State with powers or functions governmental in nature, they become agencies or instrumentalities of the State." Of course, with the growth of the welfare State, it is very difficult to define what functions are governmental and what are not, because, as pointed out by Vill-mer. L.J. in Pfizer v. Ministry of Health, (1964) 1 Ch 614, there has been, since mid-Victorian times, "a revolution in political thought and a totally different conception prevails today as to what is and what is not within the functions of Government". Dougles. J. also observed to the same effect in New York v. United States (1945) 326 US 572: "A State''s project is as much a legitimate governmental activity whether it is traditional, or akin to private enterprise, or conducted for profit". Cf. Helvering v. Gerhardt, 1937 304 US 405, 426, 427. A State may deem it as essential to its economy that it owns and operate a railroad, a mill, or an irrigation system as it does to own and operate bridges, street lights, or a sewage disposal plant. What might have been viewed in an earlier day as an improvident or even dangerous extension of state activities may today be deemed indispensable. It may be noted that besides the so-called traditional functions, the modern State operates a multitude of public enterprises and discharges a host of other public functions. If the functions of the corporation are of public importance and closely related to governmental functions, it would be a relevant factor in classifying the corporation as an instrumentality or agency of Government. This is precisely'' what was pointed out by Mathew, J., in
(Emphasis supplied)
86. The above ruling of the Supreme Court shows that the Corporation TANSI is not the extended arm of the Government and the question that was decided in
87. The judgment in
88. Similarly, the judgment relied on by the learned S.P.P. rendered in R. Eucharista v. State of Tamilnudu represented by the Secretary (1980 TNLJ 334). is also of no help to the prosecution, since the question that was decided therein, was whether a writ can lie against a corporation and the court held that a writ will lie against the corporation, which principle was. in fact, approved by the Supreme Court in
89. The learned S.P.P. also places reliance on the judgment of the Supreme Court rendered in
90. In
91. I will now take up whether the first Respondent in this appeal has committed an offence u/s 169 IPC and whether the other three Respondents have abetted A1 in committing the said offence. Section 169 IPC reads as follows: "Whoever, being a public servant, and being legally bound as such public servant, not to purchase or bid for certain property, purchases or bids for that property, either in his own name or in the name of another, or jointly, or in shares with others, shall be punishable with simple imprisonment for a term which may extend to two years, or with fine, or with both; and the property, if purchased, shall be confiscated". The learned S.P.P. contends that the meaning of the words "legally bound to do" occurring in Section 169 IPC is, whatever it is illegal to him to omit and the word "illegal" is applicable to everything which is an offence or which is prohibited by law and which furnishes a ground for civil action. The said submission is based on the definition of "illegal" and "legally bound to do" defined in Section 43 IPC. It is his contention that since the Code of Conduct contemplates that no Minister should purchase the Government property. Al has committed an offence u/s 169 IPC. A careful reading of Section 169 IPC shows that the words "certain property" occurring in the said Section deals with the properties which are to be sold under various statutes which a public servant is forbidden from purchasing. Section 174 IPC also contains the words "legally bound to do" in contra-distinction to the words "intentionally omits" occurring in the same Section and therefore, "legally bound to do" as defined in Section 43 IPC, cannot be imported into Section 169 IPC, as Section 169 IPC contemplates as to what a person is "not legally bound to do". Legally bound to do" and "legally not bound to do" are two different concepts and not the same as contended by the learned S.P.P. Section 174 IPC not only contemplates what a person is legally bound to do but also contemplates the intentional omission for the creation of an offence. A legal omission or an illegal commission alone can become an offence and what is contemplated u/s 169 IPC is an illegal commission of an act by a public servant. The words "legally bound to do occur" in Sections 175, 176, 177, 179, 181, 191, 202, 221, 222, 223 and 225- A IPC. What is contemplated in the above sections are acts which a person is legally bound to do, but if he omits to do that particular act mentioned in the Sections, then an offence is made out but, Section 169 IPC only recognises an act as an offence if a public servant being legally bound as such public servant not to purchase or bid, etc., purchases or bids for that property The words "legally bound to do" occurring in other Sections noted above are not used in Section 169 IPC, but what is contemplated u/s 169 IPC is what a public servant is "legally bound not to do" and therefore, the definition in Section 43 IPC cannot be made use of by importing the extended definition of the word "illegal" in Section 43 IPC into Section 169 IPC. Therefore, the civil action contemplated u/s 43 IPC is irrelevant. So, there should be law which prohibits a public servant from doing a particular act and if he does it, it becomes an offence u/s 169 IPC. If there is a law prohibiting a public servant from purchasing a property and if he purchases it, then he can be made liable. "Legally bound to do" is different from "legally bound not to do", since a public servant, u/s 169 IPC, is not legally bound to do an act, namely purchase of a properly. Therefore, there must be a law prohibiting a public servant from purchasing a property and if the said public servant is not bound by any law, the act of the public servant in purchasing the property, does not become illegal. Therefore, it cannot lead to a civil action since the extended definition of "illegal" in Section 43 IPC will not come into operation. The prosecution cannot contend and say that the definition of the word "illegal" defined in Section 43 IPC must be considered to mean that it also includes the words "not legally bound". In fact, wherever necessary, the Indian Penal Code itself defines the opposites of various terms as could be seen from Section 23 IPC which defines "wrongful gain" and "wrongful loss". Similarly, Section 33 IPC defined "act" and "omission". Therefore, it is clear that wherever the Code wanted to define the opposite connotation, it has expressly defined them and hence, the words "legally bound not to do" have not been defined in the code The definition of the words "legally bound to do" defined in Section 43 IPC cannot be made use of to contend that purchase of property is an illegal act leading to a civil action.
92. The question now to be decided is the purpose of Section 169 IPC. The purpose of Section 169 IPC is to be seen in the background of certain provisions contained in certain Acts which prohibit purchase of certain types of properties by public servants. Section 481 Code of Criminal Procedure mandates that a public servant having any duty to perform in connection with the sale of any property under Code of Criminal Procedure shall not purchase or bid for the property. Code of Criminal Procedure being the Code prescribing the procedure for trial of offences recognises an offence u/s 481 Code of Criminal Procedure and no punishment is prescribed for the said offence. It is because the punishing Section is Section 169 IPC.
93. Section 189 of the Railways Act, 1989, states that a railway servant shall not (a) purchase or bid for; either in person or by an agent, in his own name or in that of another or jointly or in shares with others, any property put to auction u/s 83 or Section 84 or Section 85 or Section 90, or (b) in contravention of any direction of the railway administration in this behalf, engage in trade. The Railways Act does not provide for any punishment for the violation of Section 189 IPC though the said Act provides punishment for offences committed by persons, who are not public servants, against railway administration. Therefore, the only provision under which a railway servant can be punished for violation of Section 189 of the said Act, is Section 169 IPC. The question then to be decided is whether a railway servant is a public servant for him to be punished u/s 169, IPC since Section 169 IPC contemplates punishment only to a public servant. Sub-section (32) of Section 2 of the Railways Act define "railway administration" as follows: "railway administration, in relation to (a) a Government railway, means the General Manager of a Zonal Railway; and (b) a non-government railway, means the person who is the owner of lessee of the railway or the person working in the railway under an agreement". Sub-section (34) of Section 2 of the said Act defines a railway servant as any person employed by the Central Government or by a railway administration in connection with the service of a railway. Sub-section (32) of Section 2 of the said Act defines railway administration and makes a distinction between a Government railway and a non-government railway. Then the question is whether the servent employed by a non-government railway is a public servant for him to be punished u/s 169 IPC. This is taken care of by Section 188(1) of the Railways Act. which reads as follows:" any railway servant, who is not a public servant within the meaning of Section 21 of the Indian Penal Code (45 of 1860), shall be deemed to be a public servant for the purposes of Chapter IX and Section 409 of that Code Section 169 IPC falls under Chapter IX. The term "any railway servant" occurring in Sub-section (1) of Section 188 of the said Act, therefore, means a public servant whether he is employed in government railway or in non government railway and will be liable for punishment u/s 169 IPC for committing an offence u/s 189 of the Railways Act.
94. There is a similar provision in the Cattle Tresspass Act, 1871. Section 19 of the above Act states that no officers of police or other officer or pound keeper appointed under the provisions herein contained shall, directly or indirectly, purchase any cattle at a sale under the Act. Section 27 of the said Act provides punishment to any pound keeper releasing or purchasing or delivering cattle contrary to the provisions of Section 19 and it also makes him liable for punishment for omitting to provide any impounded cattle with sufficient food or water or failing to perform any other duties imposed upon him by the Act over and above any other penalty to which he may be liable. A reading of Section 27 of the Cattle Tresspass Act therefore, shows that the Act provides punishment only to the pound keeper for the offence u/s 19 of the said Act and it does not provide punishemt to a public servant for such commission of offence under the said section since punishment is provided u/s 169 IPC. It is to be remembered that the Cattle Trespass Act was brought into the statute books only in the year 1871 much later to the Indian Penal Code of 1860. The legislature was therefore, aware that the police officer or other officer contemplated u/s 19 of the Cattle Trespass Act is a public servant and can be punished for the violation of Section 19 of the said Act, u/s 169 IPC and hence deliberately omitted to provide penalty u/s 27 of the Cattle Trespass Act for a public servant.
95. Section 136 of the Transfer of Property Act reads as follows: "No judge, legal practitioner, or officer connected with any court of justice shall buy or traffic in or stipulate for. or agree to receive any share of or interest in any actionable claim and no court of justice shall enforce at his instance or at the instance of any person claiming by or through him, any actionable claims so dealt with by him as aforesaid''. There is no provision in the said act for violation of Section 136 of the Act and for any violation of Section 136 of the said Act prosecution against the person mentioned therein can only be for the offence u/s 169 IPC.
96. In Narayan v. Emperor (Vol. 11 Cri LJ 613), Section 146 (1) of Berar Municipal Law came up for consideration Section 146(1) of Berar Municipal Law was in the following terms: "If any member, officer, or servant of a committee is, otherwise that with the permission in writing of the commissioner directly or indirectly interested in any contract made with the committee, he shall be deemed to have committed an offence u/s 168 of the Indian Penal Code." The Nagpur Judicial Commissioner''s Court, which considering Section 146(1) of Berar Municipal Law, held as follows:
Section 146 of the Berar Municipal Law is only one of host of such enactments, and follows them in bringing a particular form of dealing forbidden by it within the definition of the word ''trade'' as used in Section 168 of the Indian Penal Code. It is merely a referring section - a sort of conduit pipe that leads to the main Section which sets out the elements of, and provides the punishment for a particular offence. Section 168 requires three elements only to constitute the offence with which it deals, namely, (i) that the offender is a public servant; (ii) that as such he is legally bound not to engage in trade and (iii) that he has enaged in trade so forbidden.
It will be seen that the section is in a way incomplete without the assistance of some other enactment of rule of law which imposes the legal prohibition required as the second of the above elements and the enactment containing the prohibition naturally and necessarily defines the area which is covered by it, both as to the call of public servant to whom it applies and the nature of the dealing in which those servants are prevented from engaging. In the majority of cases, the Municipal Law, so to speak hands over the Indian Penal Code an offender who enagages in any commercial dealing prohibited by it. But, there are cases where the penalty for such an offence is provided by the special Act itself, e.g., Madras Municipal Act, I of 1884, Section 29; the Bengal Municipal Act, III of 1884 Section 57 and the Burma Municipal Act, III of 1898, Section 40. There are also cases where no penalty attaches, as in City of Bombay Municipal Act, III of 1888, Sections 60 and 87. Where, however, such words are used as we find in Section 146 of the Berar Municiapl Law 1886, it seems clear the the intention of the law is that the offender should be punished u/s 168 of the Indian Penal Code. Therefore, the offence charged against the applicant is not one punishable under the municipal law but one punishable under that Code and Section 151 of such law has no application.
97. The Code of Conduct not having a statutory force, Section 169 IPC cannot be resorted to by the prosecution to hold that A1 purchased the property and that the other accused have abetted her in the commission of offence. Therefore, the judgment of the Madras High Court rendered in In re, A.S. Socha Gowder (1956 Mad 335) relied on by the learned S.P.P., will not apply to the present case as it was dealing with the case involving interpretation of the words, " legally bound to do" and did not have an opportunity to consider Section 169 IPC.
98. A Division Bench of Bombay High Court had an occasion to consider Section 43
99. Similiar view was expressed by the Division Bench of this Court in Queen Empress v.D. Chinna Appayya Naidu (1 MLJ 741) where the accused was prosecuted u/s 177 IPC on allegation that the accused submitted to his official superior a false ''Nil'' return of lands in his enjoyment and also made a false statement to the same effect in a revenue enquiry before the Principal Assistant Collector. The Court held that the accused was not legally bound to furnish the information required of him within the definition of "legally bound" in Section 43 IPC and that no order of the Revenue Board directing officers of the status has been legally proved to exit. The Division Bench, while considerng Section 43 IPC came to the conclusion that it was not illegal on the part of the accused in furnishing a false return as it was not prohibited by any law or which furnishes a ground for evil action. The Division Bench also explained the reasons by giving an illustration that an official is bound by the rules of his superior to be at his office at 10 a.m. and to enter his name in a book kept for that purpose; he falsely enters his arrival at 10 when he, in fact, arrived at 11 O'' clock. The Division Bench held that the person by making a wrong entry in the arrival register as if he arrived at 10 O'' clock, cannot be said to have committed an offence, though he was guilty of breach of departmental order and that he was not legally bound for him to be convicted u/s 177 IPC.
100. The contention of the learned S.P.P. that the Code of Conduct, which was issued under the authority of the Governor, is legally enforceable, cannot be accepted in view of the judgment of the Supreme Court rendered in
though learned Counsel for the Respondent started by attempting such a justification by invoking Section 12 of the Indian Police Act. he gave this up and conceded that the Regulations contained in Chapter XX had no such statutory basis but were merely executive or departmental instruction framed for the guidence of the police officers. They would not, therefore, be ''a law'' which the State is entitled to make under the relevant Clauses (2) to (6) of Article 19 in order to regulate or curtail fundamental rights guaranteed by the several sub- clauses of Article 19(1), nor would the same be procedure established by law'' within Article 21, the position, therefore, is that if the action of the police which is the arm of the executive of the State is found to infringe any of the freedoms guaranted to the Petitioner, the Petitioner would be entitled to the relief of mandamus which he seeks, to restrain the State from taking action under the regulations." The judgment of the Supreme Court in
101. The next question to be decided is whether the property of TANSI is the property of the Government to say that Al violated Clause 2 (b) of the Code of Conduct by purchasing the property of TANSI. Article 285 of the Constitution of India is as follows: "(1) the property of the Union shall, save in so far as Parliament may by law otherwise provide, be exempt from all taxes imposed by a State or any authority within a State. (2) nothing in Clause (1) shall, until Parliament by law other-wise provides prevent any authority within a State from levying any tax on any property of the Union to which such property was immediately before the commencement of this Constitution liable or treated as liable, so long as that tax continues to be levied in that State". It provides that the property of the Union or of a a State shall be exempt from all taxes imposed either by the Union on the properties of a State or by a State on the properties of the Union.
102. In a case before the Supreme Court in
The Supreme Court also quoted with approval the passage from Pennington''s Company Law, 4th Edition, wherein the author has summed up the position of the learned Judge, Sanborn,J., to the effect that as a general rule, a corporation will be looked upon as a legal entity and an exception can be made" when the notion of legal entity is used to defeat public convenience, justify wrong, protect, fraud, or defend crime", in which case, "the law will regard the corporation as an Association of persons". In cases, such as those of the corporation before the Supreme, Court, it was held that there is no scope for applying the doctrine of lifting the veil in order to have regard to the realities of the situation and the companies having been incorporated under the Companies Act for a lawful purpose, the properties owned by them are their own and they do not vest with the Government. The above findings and the law laid down by the Supreme Court show that the property owned by the Corporation cannot be treated as the property of the Government. Therefore, the property of TANSI cannot be treated to be the property of the Government and under the above circumstances, Clause 2(b) of the Code of Conduct will not apply.
103. The above judgment of the Supreme Court in
104. In
105. The principles laid down by the Supreme Court, therefore, show that the property owned by a Corporation, will not be the property of the Government and purchase of the property by Al will neither attract Section 169 IPC, nor will it be a violation of Clause (2)(b) of the Code of Conduct, which has no Statutory force. The contention of the learned S.P.P. that the judgments dealing with Article 285 of the Constitution of India will not apply to the facts of this case, since they relate to the taxation policy, is unacceptable. The Supre-ment Court in no uncertain terms in the above judgment, stated that the Corporation is a separate legal entity and cannot claim that it is the extended arm of the government department.
106. The recitals in Ex.p-17, the sale deed, which I have extracted above, show that it was executed by A3 on behalf of TANSI and state that TANSI is the absolute owner of the property. If the sale deed had been executed by the Government, it could not have passed title to the purchased and therefore, TANSI executed the sale deed in its capacity as the absolute owner of the property. The prosecution, having filed Ex.P.17 and relied on the same, did not let in any evidence to show that the contents are false and are not binding on the Government.
107. On the discusion made above, I hold that the prosecution has not succeeded in establishing the offences with the Appellants/ accused were convicted and therefore,. I set aside the conviction and sentence imposed upon them.
108. In the result, C.A. Nos. 972,973, 974,977,981 and 987 of 2000 filed by A1,A2,A6,A3,A4 and A5 respectively, are allowed and C.A. No. 1168 of 2000 filed against the acquittal of Al to A4 under Sections 169 and 169 r/w 109 IPC is dismissed. It is reported that the Appellants accused are on bail. Hence, the bail bonds, if any, executed by them, shall stand cancelled and the fine amount, if any, paid by them shall be refunded.
