Establishing a Prima Facie Case

The initial burden of proof lies squarely on the prosecution to establish a prima facie case against the public servant. To discharge this burden, the prosecution must prove certain fundamental ingredients. As articulated in numerous judicial decisions, including M. Krishna Reddy v. State Deputy Superintendent Of Police, Hyderabad (cited in Ananda Bezbaruah)^[10] and reiterated in cases like ANIMESH KUMAR v. THE STATE OF BIHAR^[16] and Dhan Subba v. State Of Sikkim^[25], these ingredients are:

1. The accused is a public servant.
2. The nature and extent of the pecuniary resources or property found in their possession, or in the possession of any person on their behalf.
3. The known sources of income of the public servant during the relevant period (i.e., known to the prosecution).
4. The pecuniary resources or property found in possession are disproportionate to their known sources of income.

The prosecution typically defines a "check period" for this assessment.^[11] The calculation of disproportionate assets involves comparing the assets acquired and expenditure incurred during the check period with the income earned during the same period. For instance, in Central Bureau Of Investigation (Cbi) And Another v. Thommandru Hannah Vijayalakshmi, disproportionate assets (DA) were computed as: DA = (Assets acquired during check period + Expenditure during check period) - (Income during check period).^[11] The DA percentage is then often calculated as (DA / Income) * 100.^{[11, 12]}

Shifting of Burden to the Accused

Once the prosecution successfully establishes these four ingredients, the offence of criminal misconduct under Section 13(1)(e) is considered complete, unless the accused public servant can satisfactorily account for the disproportionate assets.^{[10, 16]} At this juncture, the burden of proof shifts to the accused.^{[5, 16, 23]} It is crucial to note that the standard of proof required from the accused is not as stringent as that imposed on the prosecution. The accused is expected to establish their explanation on a "preponderance of probability."^{[5, 16, 23, 24, 25, 26]} This principle, drawing from the dictum in Woolmington v. Director of Public Prosecutions^[5] and applied in Indian anti-corruption law through cases like V.D. Jhingan v. State Of Uttar Pradesh^{[5, 16]}, acknowledges the practical reality that the facts explaining the sources of assets are often specially within the knowledge of the accused, invoking Section 106 of the Indian Evidence Act, 1872.^{[16, 23, 26]} As observed in C.S.D. Swami v. The State, the prosecution cannot be expected to know all the affairs of a public servant.^{[16, 26]}

The "Satisfactory Account" Defence

The gravamen of the offence under Section 13(1)(e) lies in the failure of the public servant to "satisfactorily account" for the disproportionate assets.^{[8, 10]} What constitutes a "satisfactory account" is a question of fact to be determined based on the evidence presented in each case. The Supreme Court in State Of Haryana And Others v. Bhajan Lal And Others emphasized that mere possession of pecuniary resources or property is not an offence by itself; it is the failure to satisfactorily account for such possession that makes it objectionable.^[8]

However, certain defences may not automatically suffice. For example, the mere filing of income tax returns, especially if they were accepted summarily without a detailed probe by tax authorities, may not be conclusive proof of lawful income. The Supreme Court in State of Tamil Nadu v. N.Suresh Rajan cautioned that accepting property in the name of an income tax assessee as definitively belonging to them could lead to disastrous consequences, allowing corrupt public servants to amass wealth in the names of others.^[13] Conversely, a credible explanation, such as assets belonging to a relative like a father-in-law, if substantiated, could form a valid defence, as seen in State Of Maharashtra v. Wasudeo Ramchandra Kaidalwar.^[5]

"Known Sources of Income"

The Explanation to Section 13(1)(e) defines "known sources of income" as income from any lawful source, with the receipt intimated according to applicable rules.^[9] The judiciary has interpreted this to mean sources known to the prosecution after a thorough investigation.^{[2, 16]} It is not incumbent upon the prosecution to disprove every conceivable or hypothetical source of income that the accused might claim. The Supreme Court in Wasudeo Ramchandra Kaidalwar clarified that the prosecution is not expected to embark on an exhaustive inquiry to rule out all possible, unknown sources of income.^[5] This principle protects the prosecution from an impossible burden, especially concerning information that is within the special knowledge of the accused.^{[16, 26]}

Proportionality and Thresholds

The term "disproportionate" implies a significant difference between assets and known income. In Krishnanand Agnihotri v. State Of Madhya Pradesh, dealing with the presumption under Section 5(3) of the PC Act, 1947, the Supreme Court held that where the excess assets were less than ten percent of the total income, it was insufficient to trigger the presumption of criminal misconduct.^[1] While this specific percentage was in the context of the older Act's presumption clause, the principle of significant disproportionality remains relevant. Modern calculations under Section 13(1)(e) often express disproportionality as a percentage, with cases showing figures like 22.86%^[11] and even 244.71%^[12] being prosecuted.

Benami Transactions

Assets held "by any person on his behalf" bring benami transactions within the ambit of Section 13(1)(e). The burden of proving that a transaction is benami, i.e., held by one person for the benefit of the public servant, generally rests on the prosecution.^[1] This aligns with the principle established in Jayadayal Poddar v. Mst Bibi Hazara, which requires concrete evidence over mere suspicion for benami allegations.^[1]

Investigation and Charge Sheet

A fair and thorough investigation is paramount. The Supreme Court in Bhajan Lal cautioned that a police officer investigating an offence under Section 5(1)(e) of the PC Act, 1947 should not proceed with a preconceived idea of guilt, as baseless allegations can cause incalculable harm.^[8] Deficiencies in the investigation, such as failure to verify documents, properly calculate income and expenditure, or obtain necessary certifications for electronic evidence (e.g., under Section 65B of the Indian Evidence Act), can weaken or even vitiate the prosecution case.^[17] The charge sheet itself, while a formal document outlining allegations, is not substantive evidence; the prosecution must prove its case beyond a reasonable doubt with legally admissible evidence.^[17]

Quashing of Proceedings (Section 482 CrPC)

The High Court possesses inherent powers under Section 482 of the Code of Criminal Procedure, 1973, to quash criminal proceedings to prevent abuse of process or secure the ends of justice. However, this power is to be exercised sparingly and with caution, particularly in corruption cases. In State Of M.P v. Awadh Kishore Gupta And Others, the Supreme Court emphasized that High Courts should not prematurely quash investigations, especially when factual clarity is lacking or evidence is yet to be fully gathered.^[2] The guidelines laid down in State of Haryana v. Bhajan Lal^[2] are often invoked, restricting quashing to cases where, for instance, there is a clear absence of a prima facie case or the proceedings are manifestly frivolous or vexatious.

Sanction for Prosecution

The requirement of sanction for prosecuting public servants is a critical procedural safeguard. A unique situation arises concerning judges of the higher judiciary. In K. Veeraswami v. Union Of India And Others, the Supreme Court held that while Judges of the Supreme Court and High Courts are "public servants" under the PC Act, 1947, their prosecution requires sanction from the President, acting upon an address by Parliament.^[7] The Court noted the impracticality of this process, effectively creating a shield to preserve judicial independence, though it acknowledged this could leave a legislative gap.^[7]

Departmental Proceedings v. Criminal Prosecution

The outcome of departmental proceedings does not necessarily bind criminal courts. The Supreme Court in State Through Spe & Cbi, Andhra Pradesh v. M. Krishna Mohan And Another held that exoneration in a departmental inquiry does not automatically lead to an acquittal in a criminal case, as the standards of proof and procedures differ significantly.^[4] However, the possession of disproportionate assets can also constitute "misconduct" warranting departmental action, as recognized in B.C Chaturvedi v. Union Of India And Others.^{[9, 20]} Suspension of a public servant pending investigation or trial for disproportionate assets is also a common administrative measure.^[19]