Selvi J. Jayalalitha v. State, Karnataka High Court, Judgment, Law, casemine.com

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Equivalent Citations

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Case Number

Crl. A. No. 835/2014, Crl. A. No. 836/2014, Crl. A. No. 837/2014, Crl. A. No. 838/2014, Crl. A. No. 17/2015, Crl. A. No. 18/2015, Crl. A. No. 19/2015, Crl. A. No. 20/2015, Crl. A. No. 21/2015, Crl. A. No. 22/2015, Criminal Appeal No. 835 of 2014, C/W, Criminal Appeal No. 836 of 2014, Criminal Appeal No. 837 of 2014, Criminal Appeal No. 838 of 2014, Criminal Appeal No. 17 of 2015, Criminal Appeal No. 18 of 2015, Criminal Appeal No. 19 of 2015, Criminal Appeal No. 20 of 2015, Criminal Appeal No. 21 of 2015, Criminal Appeal No. 22 of 2015

Attorney(S)

Sri. L. Nageshwara Rao, Senior Counsel A/W Sri. Harikumar G. Nair and Sri. Gautam Bharadwaj, Advocates for Sri. B. Kumar, Senior Counsel for Sri. S. Senthil and Sri. K.C. Paneerselvam, Advocates
Sri. R. Basant, Senior Counsel for Sri. C. Manishankar, Advocate
Sri. T. Sudantiiram, Senior Counsel for Sri. R. Anbukarasu and Sri. Murthy Rao, Advocates
Sri. T. Sudantiram, Senior Counsel for Sri. A. Asokan, Advocate
Sri. B.V. Acharya, Special Public Prosecutor, Sri. Sandesh J. Chouta, Advocate, Appointed to Assist Spl.PP Vide Notification No. Law 01 Lce 2015, Dated 28.04.2015 Issued by the Government of Karnataka
Sri. Udaya Holla, Senior Counsel for Sri. S.N.D Kulashekara, Advocate for Sri. K. Srihari, Advocate
Sri. Jayakumar S. Patil, Senior Counsel for Sri. S.N.D. Kulashekara, Advocate for Sri. K. Shrihari, Advocate
Sri. Udaya Holla, Senior Counsel for Sri. S.N.D. Kulashekara, Advocate for Sri. K. Srihari, Advocate
Sri. Udaya Holla, Senior Counsel for Sri. S.N.D. Kulashekara, Advocate for Sri. K. Srihari, Advocate
Sri. Aditya Sondhi, Senior Counsel for Sri. S.N.D. Kulashekara, Advocate for Sri. K. Srihari, Advocate
Sri. Aditya Sondhi, Senior Counsel for Sri. S.N.D. Kulashekara, Advocate for Sri. K. Srihari, Advocate
Sri. B.V. Acharya, Special Public Prosecutor for R1
Sri. S. Senthil, Advocate for R2
Sri. C. Manishankar, Advocate for R3
Sri. Moorthy Rao, Advocate for R
Sri. A. Asokan, Advocate for R-5

Judges

C.R. Kumaraswamy, J.

Acts

u/Sec.109 of I.P.C. R/w. Sec. 13 (1) (e) R/w. Sec. 13 (2) of P.C. Act. SENTENCE For the offence u/Sec. 13 (1) (e) R/w. Sec. 13 (2) of the P.C. Act, A-1
Sec.5(1)(e) of the Prevention of Corruption Act, 1947. The present provision of Sec.13(1)(e) of the new Act
provisions of Benami Transactions (Prohibition) Act 1988, (hereinafter referred to as Benami Act)
[Rule 18(4)]. THE PREVENTION OF CORRUPTION ACT, 1988 - BY MALIK'S COMMENTARY (page No.480, Section 13)
4) Anno: C.J.I Evi Act, Ss.100-103 N.3 (b) Criminal Law Amendment Ordinance (38 of 1944) S.2 (2) (a)
u/Secs. 109 of I.P.C., R/w. Sec. 13 (2) of P.C. Act, A-2 Tmt. Sasikala Natarajan, A-3
Section 2(b) of the Prevention of Corruption Act, 1988. Crime No.13/AC/96/HQ
Section 13(1)(e) read with Section 13(2) of the Prevention of Corruption Act.
u/Sec. 120-B of I.P.C. R/w. Sec. 13 (1) (e) R/w. Sec. 13 (2) of P.C. Act. Prosecution
section 5[2] read with section 5[1][e] of Prevention of Corruption Act
Section 12 (1) of the Criminal Law Amendment Ordinance, 1944. Section 3
u/Sec. 109 and 120-B of I.P.C. R/w. Sec. 13 (1) (e) R/w. Sec. 13 (2) of P.C. Act.
Section 16 of the Wealth Tax Act and Section 148 of Income Tax Act.
SECTION 13 PREVENTION OF CORRUPTION ACT 1988
sub-rule(4) of rule 16 of the All India Services (Conduct) Rule, 1968
Transactions (Prohibition) Act and Prevention of Corruption Act
Sections 13(2) and 13(1)(e) of the Prevention of Corruption Act
u/Sec. 120-B of I.P.C. R/w. Sec. 13 (2) of P.C. Act, A-2, A-3 and A-4
Section 13(1) (e) of the PC Act read with Section 120-B of IPC.
Sections 10 and 11 of Criminal Law Amendment Ordinance (38
SECTION 251 INCOME TAX ACT
Sections 209, 210, 211 and 215 of the Companies Act, 1956,
section 4[1] of the Prevention of Corruption Act, 1947,
section 5[3] of the Prevention of Corruption Act, 1947,
PREVENTION OF CORRUPTION ACT 1988
section 13[1][e] of the Prevention of Corruption Act.
Section 53 of the Indian Penal Code. Section 13(1)
u/Sec. 13 (1) (e) R/w. Sec. 13 (2) of P.C. Act. Prosecution
Sections 109 and 120-B of the Indian Penal Code.
Section 5(3) of the Prevention of Corruption Act.
SECTION 342 CRIMINAL PROCEDURE CODE
provisions of the Banking Regulations Act 1949
u/Sec. 120-B I.P.C., R/w. Sec. 13 (2) of P.C. Act, A-1
Section 114(d) of the Indian Evidence Act, 1872,
India Services (Conduct) Rule 1968 (Page No.186):
Section 103 of the Indian Evidence Act,1872
SECTION 122 TRANSFER OF PROPERTY ACT
Central Civil Services (Conduct) Rules, 1964
section 133A(5) of the Income Tax Act, 1961.
Prevention of Corruption Acts 1889-1916
Section 202 of Cr.P.C. PW.240-Tmt.Letika
Section 106 of Indian Evidence Act, 1872,
Section 106 of the Indian Evidence Act
SECTION 148 INCOME TAX ACT 1961
Section 120(B) of the Indian Penal Code,
section 103 of the Indian Evidence Act.
Section 10 of the Indian Evidence Act
Section 45 of the Indian Evidence Act,
SECTION 69 INCOME TAX ACT 1961
Section 43 of the Indian Penal Code,
Tamilnadu General Sale Tax Act, 1959.
(Crl) 357 (AP). Language of Section 106
94.16) Sec.220 of the Companies Act,
SECTION 279 A INCOME TAX ACT
INCOME TAX ACT
Income Tax Act or Wealth Tax Act
section 106, Indian Evidence Act,
Section 13(1)(e) of the 1988 Act
India Services (Conduct) Rules
REPRESENTATION OF THE PEOPLE ACT
Sec. 13 (1) (e) of the P.C. Act. 99.
sub-Section(3) of Section 5
sub-rule (4) of the rule 16
SECTION 106 EVIDENCE ACT
section 12[1] of Criminal
Section 452 of Cr.P.C.
Section 161 of Cr.P.C.
Section 120-B of IPC.
Indian Companies Act,
Central Sale Tax Act.
Companies Act. 92.30)
COMPANIES ACT 1956
INDIAN STAMP ACT
Section 13(1)(e)
Act (1872) S.100.
Section 5(1)(e)
Sales Tax Act
[Rule 18(1)(ii)].

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Smart Summary

Factual and Procedural Background

The opinion deals with a criminal prosecution concerning the assets and pecuniary resources found in possession of the accused, primarily A-1, during a specified check period from 1.7.1991 to 30.4.1996. The prosecution detailed an extensive list of assets, including immovable properties, cash, constructions, jewellery, vehicles, machinery, and other valuables, many of which were allegedly acquired disproportionate to the known sources of income of the accused. The accused raised objections and defences, including claims of independent income sources, business activities, and lawful acquisition of assets. The trial court examined the evidence, including valuations, bank transactions, and testimonies, and convicted the accused under various provisions of the Prevention of Corruption Act and the Indian Penal Code. The matter proceeded to appeals challenging the conviction and confiscation orders.

Legal Issues Presented

Whether the appellants - Accused Nos. 1 to 4 are guilty of the offences charged and convicted?
Whether Accused Nos. 2 to 4 were parties to a criminal conspiracy to possess assets and pecuniary resources on behalf of Accused No.1 and abetted her in acquiring properties?
Whether the confiscation of immovable properties and auctioning of gold and diamond ornaments to satisfy the fine is sustainable in law?

Arguments of the Parties

Appellant's Arguments

Assets acquired prior to the check period should be excluded; only assets within the check period are relevant.
Leading questions were improperly put during re-examination affecting evidentiary value.
Income tax returns and wealth tax returns filed by the accused and firms should be relied upon as lawful sources of income.
The prosecution failed to prove benami transactions and the flow of illicit funds from A-1 to companies controlled by A-2 to A-4.
Valuations of properties, constructions, and jewellery were inflated and not based on scientific data or proper market rates.
Marriage expenses were exaggerated and largely borne by the bride’s family and party workers, not solely by A-1.
The accused and companies are distinct legal entities; without notice and proper procedure, confiscation orders are invalid.
The prosecution case is based on surmises and conjectures lacking direct evidence of criminal conspiracy or abetment.
Loans taken by the accused and companies were not considered as lawful income by the prosecution.
Income from agricultural properties like the Grape Garden and Kodanadu Tea Estate was omitted by the prosecution and should be considered.
The trial court ignored relevant income and loan evidence, and improperly reduced construction and marriage expenses on guesswork.
Statements of witnesses were inconsistent and unreliable.

Respondent's Arguments (Prosecution)

The accused amassed wealth disproportionate to their known sources of income during the check period.
Assets were acquired in the names of accused and various firms and companies controlled by them, but the funds originated from A-1.
The accused conspired and abetted each other to hold and acquire assets disproportionate to lawful income.
Extensive documentary and oral evidence, including bank officials and registrars, establish the flow of funds and conspiracy.
The so-called deposit schemes by firms like Jaya Publications and Namadhu MGR were fabricated after the charge sheet to explain illicit wealth.
Valuation reports by competent engineers and income tax assessments support the prosecution’s valuation of assets and expenditures.
Marriage expenses were largely borne by A-1, supported by documentary and testimonial evidence.
Loans taken by accused and companies were utilized for acquiring properties but do not explain the disproportionate assets.
The accused failed to satisfactorily account for the assets as required under the Prevention of Corruption Act.
The corporate veil of companies used by the accused to hold properties acquired through illegal means should be pierced.
Confiscation orders are justified based on the conviction and evidence of ill-gotten assets.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Solomon vs. Solomon (1897 AC 22)	Separate legal entity of a company and when to lift the corporate veil.	Applied to hold that companies used by accused were mere facades for illegal acquisition and to attribute properties to accused.
P.Nallammal vs. State (1999 Crl.L.J. 3967)	Private individuals can be prosecuted for abetment and conspiracy under Prevention of Corruption Act.	Applied to convict accused for abetment of criminal misconduct by public servant.
Krishnanand Agnihotri vs. State (AIR 1977 SC 796)	Disproportionate assets less than 10% of total income may not justify presumption of guilt.	Applied to assess disproportionate assets and consider permissible margin; influenced appellate decision.
Section 106, Indian Evidence Act, 1872	Onus of proof and burden of proof regarding facts especially within knowledge of accused.	Discussed to clarify prosecution burden and accused’s duty to explain disproportionate assets.
Section 13(1)(e) & 13(2), Prevention of Corruption Act, 1988	Offence of criminal misconduct for possession of pecuniary resources disproportionate to known sources of income.	Core statutory provision under which accused were convicted for illegal acquisition of assets.
Section 120-B, Indian Penal Code	Criminal conspiracy.	Applied to convict accused for conspiracy to acquire and hold disproportionate assets.
Section 109, Indian Penal Code	Abetment of offence.	Applied to convict accused aiding and abetting criminal misconduct.
Section 45, Indian Evidence Act	Expert opinion evidence.	Discussed in relation to valuation evidence and expert testimonies on property and jewellery valuation.
Section 114(d), Indian Evidence Act	Presumption as to abetment and conspiracy.	Discussed in context of drawing inferences from circumstantial evidence of conspiracy.
Section 12(1), Criminal Law Amendment Ordinance, 1944	Requirement for court to record finding as to amount of money or value of property procured by offence.	Applied to justify confiscation orders and valuation of assets for forfeiture.
Section 220, Companies Act, 1956	Filing of balance sheet and profit and loss account with Registrar.	Discussed to note non-compliance by companies used by accused, supporting inference of illegality.
Section 209, 210, 211, 215, Companies Act, 1956	Maintenance of books of accounts and audit requirements.	Non-compliance by accused companies noted as evidence of sham companies used to shield illegal assets.

Court's Reasoning and Analysis

The court meticulously analyzed the extensive evidence comprising documentary proof, witness testimonies, valuation reports, and bank account transactions. It categorized assets into immovable properties, cash, constructions, jewellery, vehicles, machinery, and other valuables acquired during the check period. The accused's claims of independent income and lawful acquisition were scrutinized against the evidence, including the lack of independent income for accused A-2 to A-4, and the control they exercised over companies which had no genuine business activity but held substantial properties.

The court examined the corporate veil doctrine and applied the principle of piercing the veil where companies were mere facades to hold illicit assets. It found that promoters had resigned and accused had taken control without proper shareholding or compliance with statutory requirements, indicating sham companies.

Bank transactions showed frequent inter-account transfers and cash deposits made by staff under the direction of accused A-2, indicating a conspiracy to launder illicit wealth. The court rejected the defence based on purported deposit schemes as fabricated afterthoughts unsupported by credible evidence.

Valuations of constructions and assets were based on expert evidence, albeit challenged by the defence; the court allowed some reduction but accepted the overall valuation as reasonable. Marriage expenses were examined in detail, with the court attributing a substantial but reduced portion of expenses to accused A-1, rejecting claims that all expenses were borne by the bride's family or others.

The court held that the accused failed to satisfactorily account for the assets disproportionate to their known sources of income, thus attracting liability under Section 13(1)(e) of the Prevention of Corruption Act and related offences. It concluded that accused A-2 to A-4 abetted and conspired with A-1 in illegally acquiring and holding assets.

On appeal, the Karnataka High Court re-examined the evidence, including income tax returns, loan documents, and valuations. It found the disproportionate assets to be less than 10% of the income, within permissible margins. The court noted that the prosecution failed to consider loans as lawful income and that valuations and marriage expenses were exaggerated and based on guesswork. It also found inconsistencies in witness testimony and held that the prosecution did not discharge its burden beyond reasonable doubt. Consequently, the convictions and confiscation orders were set aside.

Holding and Implications

The Karnataka High Court allowed the criminal appeals, set aside the convictions and sentences of the accused, and quashed the confiscation orders.

The direct effect of this decision is the acquittal of accused Nos. 1 to 4, and the reversal of confiscation of properties and assets ordered by the trial court. The court emphasized the need for prosecution to prove disproportionate assets beyond reasonable doubt, relying on credible and consistent evidence, and recognized the importance of considering lawful income such as loans and income tax returns. The judgment underscores the principle that mere suspicion or surmises are insufficient for conviction in disproportionate assets cases, and highlights the procedural safeguards in valuation and assessment of assets and expenditures.

No new legal precedents were established; rather, the court applied established principles of burden of proof, corporate veil, and evidentiary standards in corruption and disproportionate assets cases.

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Selvi J. Jayalalitha v. State

The nature and extent of the assets and pecuniary resources found in possession of the accused during the check period are detailed in Annexure-II. It is marked as Ex.P.2338. It contains a list of 306 items.

Learned Spl. P.P. has sought to delete item Nos.1 to 17 of Annexure-II on the ground that these were acquired by the accused prior to the check period.

For convenient discussion of the issues involved in the case, these assets are categorized under the following heads.

Nature of assets Item Nos. Value (in Rs.) I Immovableproperties(considerationc 1 to 173, 175, 292,297, 301, 22,83,99,174.70 ost ofregistration) 302(i),305(Excluding item Nos.24, 31, 33, 64,66,127, 145,150,159) II Cash paid over & abovesale 24, 31, 33, 64, 66,127, 145, 2,53,80,619.00 consideration 150, 159 III New or additional construction of 174, 176-192, 301, 28,17,40,430.00 buildings 302(ii) IV Gold and DiamondJewellery 284-290, 295 5,53,02,334.75 V Silver wares 291 48,80,800 VI F.Ds and shares 258-277, 298, 303,306 3,42,62,728.00 VII Cash balance in bank accounts 193-229, 296, 300, 97,47,751.32 VIII Vehicles 230-257, 299 1,29,94,033.05 IX Machinery 293, 294 2,24,11,000.00 X Footwear 278 2,00,902.45 XI Sarees 279-281 92,44,290.00 XII Wrist watches 282-283 15,90,350.00 73.1) IMMOVABLE PROPERTIES ACQUIRED DURING THE CHECK PERIOD BETWEEN 1.7.1991 AND 30.04.1996.

by cashof Rs.335000. 8,65,400.00 PW.16, 73 16.75centsin Ex.P.32, 45 125.00 PW.7, R.S.No.1/1Fold PW.51 R.S.No.1/1C4at Sholinganallore village 74 Actualconsideration Ex.P.74 5,70,200.00 PW.45 byDD 2,35,200 and cashofRs.3,35,000 75 6 grounds1087 M/s. Lex 2,84,008.00 PW.136 sq. ft. in 581 sq.ft. Property undividedshare of Develop Doc. No.370/94 landinS.No.61/1,62,66/ ment (P) Dt. 28.4.94 2 Ltd., Ex.P.647 inplotNo.17, 17-A and 18,WallaceGardenin Nungambakkam Village 76 6 grounds1087sq. ft. M/s. Lex 2,84,008.00 PW100, in 581 sq.ft.undivided Property PW136 share of Develop Doc. No.371/94 landinS.No.61/1,62, ment (P) Dt.28.4.94 66/2in Ltd., Ex.P.648 plotNo.17, 17-A and 18,WallaceGardenin Nungambakkam Village 77 6 grounds1087sq. ft. M/s. Lex Doc. No.372/94 2,84,008.00 PW100 in 581 sq.ft.undivided Property Dt.3.5.94 PW136 share of Develop Ex.P.649 landinS.No.61/1,62,66/ ment (P) 2 Ltd., inplotNo.17, 17-A and 18,WallaceGardenin 18,WallaceGardenin Nungambakkam Villge 78 6 grounds1087sq. ft. M/s. Lex 2,84,008.00 PW100 in 581 sq.ft.undivided Property PW136 share of Develop Doc.No.373/94 landinS.No.61/1,62,66/ ment (P) Dt.4.5.94 2in Ltd., Ex.P.650 plotNo.17, 17-A and 18,WallaceGardenin Nungambakkam Village i 79 3.30 acres n 94,475.00 PW141 PW159 S.No.403/3,401 i Tr. VN Doc.No.222/94 /2 nSudhakaran dt.24.05.94 PW201 Siruthavur Ex.P.905, 1578 Village.

602/2C,602/2A3A,603/1 (Pvt)Ltd., ,602/2C,604/2B, ,602/2C,604/2B, 495/2,462/4,912,259/2 ,472/9,471, 496/1,491/1,496/3, 491/2,4,5, 10, 495/2, 491,492/2inCherkulam village 108 42 acres 31 centsin Riverway Doc. No.697/94 95,740 PW.76, S.No.823/9,817/10,822/ Agro Dt. 17.11.94 PW159 5,823/3,817/2C, Products Ex.P.350 35, 36, 159, 37/3,2, (Pvt.) 149/2,149/3,37/2,130/2 Ltd., ,3,110/2,817/5,9,373/4, 382/3, 374/1, 378/4, 1072/10, 11, 817/2, 2, 1073/1, 1075/7, 822/2, 543/11, 543 in Meerkulam in village 109 34 acres and 81- Doc. No.698/94 78,801 PW.76, 1/2 cents inVallakulam Riverway Dt. 17.11.94 PW.159 Village in 221/4,218/9A, Agro Ex.P.357 90,225/2, 204/2,204/7, Products 220/2, (Pvt)Ltd., 681/6, 210/5,223/2, 224/5A,224/5, 6, 197/4,4B, 4, 198/1, 217/2, 618/7,220/4, 220/1,221/5, 225/1, 219/4, 213/5,225/1, 224/2A,222/2B M/s. Doc. No.759/94 JFarmHo Dt. 12.12.94 110 50 cents in uses Ex.P.72, 909 78,801 PW.24, S.No.2/1B, 3A in PW.50, Solinganallur PW159 Village 111 12.70 acres Meadow Doc. No.808/94 1,50,660 inS.No.701/2,654/8, Agro Dt. 22.12.94 605/4,685/5, 9, Farms Ex.P.161 583/8,601/7,198/6, (Pvt) 199/2, 4, Ltd., 594/2,688/2 inUthukkaduVillage 112 14.42acresin Meadow Doc. No.898/94 1,68,280 PW.70 S.No.685,693/4, AgroFar Dt.22.12.94 698/1,685/8, 687/4B, ms Ex.P.291 689/6, 1,692,698/3in (Pvt) Uthukadu village, Ltd., 113 8.60 acres in Meadow Doc. No.810/94 1,06,343.00 PW.54, S.No.136/1, 2, 3, Agro Dt. 22.12.94 PW159 137, 138/3, 139, Farms Ex.P.148 172/3A, 4A, (Pvt) 173/2A, 2C Ltd., in Uthukkadu Village 114 6.98 acres in Riverway Doc. No.811/94 15,888.00 PW.76, S.No.386/2, Agro Dt. 22.12.94 PW159 402/1, 293/4A, Products Ex.P.363 294/2A, 224/2B in (Pvt) Kalavai Village Ltd., 115 55.00 ½ acres in Riverway Doc. No.812/94 1,24,433.00 PW.76, S.No.682/6,203/6, Agro Dt. 22.12.94 PW159 InVallakulam village Products Ex.P.366 (Pvt)Ltd., 116 57.01acresinS.No.224/4 Riverway Doc. No.813/94 1,28,963.00 PW.76, B,204/2in Agro Dt. 22.12.94 PW159 VallakulamVillage Products Ex.P.377 (Pvt)Ltd., 117 89.62 acres inS.No.496, Riverway Doc. No.814/94 2,02,658.00 PW.76, 221/3, Agro Dt. 22.12.94 PW159 217/8 and other Products Nos. inVallakulam (Pvt)Ltd., village 118 80.95 ½ acres in Doc. No.815/94 1,83,076.00 PW.76, S.No.470/3, Riverway Dt. 22.12.94 PW159 504/2B and other Agro Ex.P.96 Products Nos. in (Pvt)Ltd., Cherakulam .

123 3472Sq.Ft.togetherwith M/s.Anjaneya Doc. No.875/94 59,96,346 PW.86, building 3000 sq. Printers(P) Dt. 30.12.94 PW159 ft. groundfloor Ltd., Ex.P.515 3700sq.ft.first FloorinSurveyNo.6794 which iscalled 69, Habibullah Road, T. Nagar.

157 1/6th undividedshare of M/s.Anjaneya Doc. No.251/95 10,87,196 PW.43 land in 5grounds Printers(P) Dt.21.3.95 PW159 and1133 Sq. Ft. in Ltd., Ex.P.109 S.No.3334/1A of S.No.3334/1A of Luz Avenue 158 1/6th undividedshare of Jaya Doc.No. 252/95 10,87,196 PW.43 land in 5grounds Contractors Dt 21.3.95 PW159 and1133 Sq. Ft. in andBuilders Ex.P.110 S.No.3334/1A of Luz Avenue 160 11 cents land and M/s. Lex Doc. No.293/95 7,98,945 PW.51, building inS.No.74/1 Property Dt 4.4.95 PW159 inNeelankaraiVillage Development Ex.P.135 (P)Ltd., 161 11 cents land and M/s. Lex Doc. No.294/95 9,49,995 PW.51, building inS.No.74/1 Property Dt. 4.4.95 PW159 inNeelankaraiVillage Development Ex.P.136 (P)Ltd., 162 3197 sq. ft. Mahasubha Doc.No. 295/95 8,55,150 PW.22 inT.S.No.115/pt,117/pt, Lakshmi Dt 4.4.95 PW159 127/7 pt Kalyana inArumbakkamvillage Mandabam Ex.P.69 163 Land and buildingto M/s. Lex Dt. 19.4.95 19,03,888 PW.78, theextent of26540 sq. Property Doc.No. 327/95 PW127 ft. witha Development Ex.P.717 PW159 superstructurein T.No. (P)Ltd., No.3077to 3079which isknown as No.30,VOC Nagar,Tanjore Town 164 7.11 ½ acres and Meadow 84,784 PW.56 in S.No.239/9, 10,11, AgroFarms Dt. 4.5.95 PW159 244/6,293/4B,358/1 (Pvt) Doc.No. 360/95 384/1, 596/2, 596/9, Ex.P207 605/4, 632/1A, 680/1 of Uthukadu village ANNEXURE-II(Ex.P.2338) 165 15.71acresin MeadoAgr Doc.No. 361/95 1,88,572 PW.56 S.No.591/2,322/7,8, oFarms(Pv Dt. 4.5.95 PW159 5,226/10,649/4,150/8,3 t)Ltd., Ex.P.214 49/1,3,333/5, 6,7,3,370/5,6,576/1, 585/2,331/5,595/4, 5,597/1,596/12,595/7,5 89/5,6, 7,578/2,3,4,583/8,4,6, 360/3,5,215/5,216/2 InUthukadu Village.

166 KodanadTeaEstate Tmt. Ex.P.1510, 7,60,00,000 PW201 AndTeaFactory,Extent N.Sasikala, 1515,1516, 900acresatKothagiri, Tmt. J. 1517,1576, NilgirisDistrictacquired Elavarasi 1630,1618, Onanunregdreconstituti andTr.VN 1101 onof Sudhakaran Partnershipdeeddt.

5.6.95attotalcostof Rs.7,60,000.00paymen tthroughsix Chequesdt.5.5.95 167 9.50 acres in S.No.324, Meadow Doc. No.446/95 1,12,213 PW.56 681/6, Agro Farms Dt. 13.6.95 PW159 360/9, 184/3, 632/2, (Pvt) Ltd., Ex.P.221 239/5, 309/5, in Uthukadu Village 168 20.33acresinS.No.198/ Meadow Doc.No. 467/95 40,197 PW159 18 ofin AgroFarms Dt. 3.7.95 VelakapuramVillage (Pvt)Ltd., Ex.P.910 169 20.89acresin Meadow Doc.No. 468/95 40,1975 PW159 S.No.198/180F8 and AgroFarms Dt. 3.7.95 otherNos. In (Pvt.) Ltd., Ex.P.911 170 2.03acresinS.No.385/1 N. Doc. No.191/95 3,44,195 PW.41, 2,385/13, 385/14 Sasikalaa a Dt. 19.7.95 PW159 inPayyanoor Ex.P.104, Village 1510, 1518, 1631 171 2.34acresinS.No.385/7, N. Doc. 3,91,655 PW159 8, 9,386/1A, Sasikala a No. 492/95 1B,1C,1D, Dt 19.7.95 386/2inPayanoor Village Ex.P.912 172 0.90 acres in N. Doc.No. 493/95 3,21,030 PW159 S.No.386/15, Sasikala a Dt. 19.7.95 385/1, 2, 3, 4, 5, Ex.P.913 6 in Payyanur Village 173 Expendituretowards 86,91,000 PW.84, acquisition ofIndo- Doc. No. PW.85, DohaChemicals Dt PW.92,

1.Tr. Ayyadurai, Ex.P. PW201 Promoter of IndoDoha PharmaceuticalRs.35,4 5,000/-

2.To interface capital market shares -

Rs.24,05,000/-

3. To Ind Bank -

Rs.27,41,000/-

74. OBJECTIONS OF THE ACCUSED:

In her written statement filed under Sec. 313 Cr.P.C., A-1 has taken up a definite stand in para 10 of the written statement, which reads as under;

"When I was the Chief Minister of Tamil Nadu between1991 and 1996, I acquired only one immovable property, a vacant site bearing Door No. 31-A Poes Garden, Chennai. I renovated my old house at Door No. 36, Poes Garden, Chennai, made a new construction at 31-A, Poes Garden, Chennai and also a Farm house in Hyderabad. The expenditures have been duly accounted for, disclosed to the Income-tax Department and accepted by them after in-depth scrutiny and verification of facts."

i) The other accused have taken up a plea that they were having independent source of income and assets. They were individually assessed under the Income-tax Act, and the various properties standing in their names were acquired out of their earnings or the business income of the firms floated by them and therefore, the prosecution is not justified in clubbing their assets with the properties of A-1.

ii) In para 20 of the written statement submitted by A-2 under Sec. 243 (1) Cr.P.C., she has stated as under;

"At all times, I had independent income and Selvi Jayalalitha had her own independent income and assets in her name. All the four of us were having independent source of income and assets and were individually assessed under the Income Tax Act. Hence, clubbing the assets of myself with A- 1 is unjustified and illegal both in law and in fact."

iii) A-2 has taken up a further plea that she is a partner in Jaya Publications. From 1990 onwards, thefirm had floated a scheme whereunder, any person could invest by making deposit of Rs.12,000/- to Rs.18,000/- with Jaya Publications. The depositors were entitled to get a particular number of copies of the daily news paper "Namadhu MGR" free of cost. The said news paper carried the news items and the messages of the General Secretary of AIADMK party. A-1 was and is the General Secretary of the party. She has specifically stated in the written statement that during the check period, an amount of Rs. 14,30,35,000/- was collected and the said scheme was disclosed to the Income Tax Department and has been duly accepted by the Income-Tax Authorities up to the level of Income Tax Appellate Tribunal.

iv) Regarding the various items of immovable properties listed by the prosecution in various Annexures, A-2 has contended that she is not related to the immovable properties at Sl. Nos. 18 to 306 viz., 18, 24, 27 to 31, 49, 50, 56 to 67, 75 to 79, 86 to 90, 94, 103, 105 to 109, 111 to 121, 124 to 154, 160 to 165, 167 to 169, 173, 174, 176, 177, 179 to 182, 186, 192 to 194, 196 to 200, 206 to 208, 210, 211, 216, 225 to 228, 230 to 233, 235, 237, 240, 242, 248, 249, 251, 252, 258, 262 to 284, 286, 288 to 292, 295, 296, 298, 302, 303, 305 and 306 of Annexure II.

v) Regarding the other properties, she has narrated in detail the mode of payment made to the respective vendors for purchase of these properties and has mentioned the source from which these items of immovable properties were purchased and has contended that all the expenses incurred for the purchase of the above properties have been declared by her and other accused individually and the Income-tax authorities have accepted the returns filed by them after thorough scrutiny and therefore, the allegations made against them are liable to be rejected.

vi) A-3 has also taken up a similar defence contending that during the check period, he was carrying on a business under the name and style "Super Duper TV" involved in production, coverage of programmes including entertainment programmes, software equipment hire and erection of dish antenna and cable TV net work. He was also carrying on the business in consultation, investment, programming, trading and vehicle hiring and was also selling mushrooms purchased from M/s Fresh Mushrooms and had earned Rs.56 lakh from the coverage of film clippings, which were telecasted in DD and other TV channels during the World Tamil Conference.

vii) A-3 has taken up a further defence that he along with A-2 became a share holder of the company i.e., Anjeneya Printers and this Anjeneya Printers acquired the following properties viz: -

1. Padmanabha Street Rs. 15,96,150.00

2. Habibullah Road Rs. 1,03,52,488.00

3. Luz Avenue 1/6th share Rs. 10,87,196.00 According to A-3, the premises where the machinery was found, was not exclusively in the occupation of M/s Anjeneya Printers Pvt., Ltd., but it was also in the occupation of M/s Jaya Publications. Regarding the valuation of machinery, A-3, in his written statement, has put forth a plea that large items of machinery were purchased from Mr. Shroff, which were under his use. The said machinery was valued at Rs. 20,16,000/-. Besides the above, certain other machinery were taken from M/s Jaya Publications on lease. The expenditure incurred by M/s Anjeneya Printers Pvt. Ltd., were submitted to the Income- tax department and were accepted by them. The total cost of machinery, which was shown in the books of M/s Anjeneya Printers Pvt., Ltd., at Rs. 74,14,935/- has been accepted by the Income-tax department after scrutiny. The total cost of machinery which is inventoried under Ex. P-664 would be Rs.94,30,935/-including the cost of machinery purchased from Mr. Shroff amounting to Rs. 20,16,000/-. Therefore, Rs.1,22,11,065/- is liable to be excluded from item No. 194 of the Annexure-II.

viii) A.3 has further contended that an amount of Rs. 50.98 lakhs shown towards the conveyance charges is totally unjustified and opposed to law. With regard to the cost of construction at Ekkatu Thangal, A-3 has contended that the entire cost of construction shown by the prosecution at Rs.2,13, 63,450/- is liable to be excluded for the reason that the site on which the building is situate belongs to a different company by name Shastry Nuts and Bolts. It is specifically stated in para 20 of the written statement that Anjeneya Printers Pvt., Ltd., is a tenant of the building and has been paying rent to M/s Shastry Nuts and Bolts. Therefore, the above said amount of Rs.2,13,63,450/- is liable to be excluded totally.

The learned Sessions Judge at sub-paragraph of 76.6 has narrated the evidence of PW.17-Tmt.Sundari. PW.17 Tmt. Sundari Shankar, the owner of theaforesaid property deposed on oath that, she was the owner of plot at C-62, Thiruvenkata Nagar, Ambaltur, Chennai measuring 4830 Sq. Ft. She had constructed a house measuring 600 Sq. Ft. therein. She wanted to sell that land. Her neighbour one Ramesh wanted to buy it. She entered into an agreement to sell the said property for Rs.5 lakhs and received Rs.1.75 lakh as advance. But the said Ramesh could not purchase the property and PW.17 was not in a position to refund the advance money. After two or three months, the said Ramesh told PW.17 that, a person close to Selvi J. Jayalalitha has come forward to buy the property and she was taken to registration office and executed thesale deed. PW.16 specifically deposed in her chief-examination that the sale amount was Rs.5 lakhs. Out of that amount, a D.D. for Rs.1,90,000/- was given to her and out of the remaining amount, Ramesh took Rs.1,75,000/- due to him and gave her the rest of the amount in cash. Her daughter Bama Chandran and Ramesh have signed the sale deed as witnesses. She further deposed that the amount given as cash is not shown in the sale deed. In the cross-examination she denied the suggestion that she had entered into an agreement with Ramesh for Rs.1,90,000/-. She asserted in the cross-examination that the said agreement was for Rs.5 lakhs. She also denied the suggestion that at the instance of the police she has falsely stated that she had taken Rs. 5 lakhs in connection with the said dealing.

76.7) It is the submission of the learned Counsel for A-2 that the so called agreement entered into with Ramesh is not produced in evidence and more over her testimony being contrary to Sec.92 of the Evidence Act, no reliance can be placed on her testimony. The learned Counsel also pointed out that, Ramesh, the attester to Ex.P.46 is examined as PW.161 but in his evidence he has not spoken anything about the execution of the agreement for Rs.5 lakhs with PW.17. Therefore, the claim made by the prosecution in this regard is not supported by oral or documentary evidence.

76.8) I have gone through the evidence of PW.161 Sri. R.Ramesh, the Asst. Manager at Indian Bank, Abirampuram Branch. The relevant portion of his chief- examination reads as under;

"During December 1992, to purchase a houseand a vacant site in Thiruvenkata Nagar, Ambaltur, Chennai from Mrs. Sundari Shankar in the name of myself and my wife, we executed a sale agreement for that I gave Rs.1,75,000/- to Sundari Shankar as advance.

To purchase the above mentioned property, I wanted to avail loan from our bank. But they told that the loan will not given for old house. I informed Sundari Shankar about this and asked her to return the advance she had taken. But she told me that as she had invested the advance money in a property in Porur, she could not return the advance. She told me to sell that property to another person and take my advance. So requested out Manager Mrs. Susarita Sunder Rajan, to make arrangements for the above mentioned property to be sold to Mrs. Sasikala. She spoke to Tmt. Sasikala and finally agreed to purchase that property for Rs. 5 lakhs. In September 1994, I brought the above Sundari Shankar to District Registration Office (North Chennai) and arrayed for the registration. Then, Mr. Raja Gopalan was the District Registrar. Mr. Raja Gopalan gave the sale amount for the above mentioned property. Rs.1,90,000/- was given as a D.D. in the name of Mrs. Sundari Shankar. The remaining Rs.3,10,000/- was given to me as cash from that amount. I took the advance of Rs.1,75,000/- which I had paid. I handed over the remaining amount and the demand draft to Mrs. Sundari Shankar. In the sale deed I have signed as a witness. "

In the cross-examination it is elicited that, PW.161 did not show the agreement copy to the police. However, he has maintained in the cross-examination that his wife and he signed the agreement in which they fixed the price as Rs.5 lakhs as sale amount for that house. In the further cross-examination PW.161 has answered thus;

"My wife and I gave back the agreement wemade to them. We don't have the photo copy for that. I don't have any documents regarding the agreement with Mrs. Sundari Shankar. I don't have any documents regarding the loan availed in the bank regarding the agreement with Mrs. Sundari Shankar, these is only the oral deposition. I have given my wife and I gave Rs.1,75,000/- to Mrs. Sundari Shankar as cash."

76.9) Thus, it could be seen that, PW.161 has substantially corroborated the testimony of PW.17 with regard to the prior agreement of sale entered into between PW.17 and PW.161. Both these witnesses have stated that, at the time of execution of the sale deed, Rs.1,75,000/- was paid as advance consideration and the said amount was refunded to PW.161 at the time of execution of the sale deed Ex.P.46. It is borne on record that the sale consideration in Ex.P.46 is shown as Rs.1,90,000 and it is also not in dispute that the said consideration of Rs.1,90,000/- was paid to PW.17 through D.D. Under the said circumstances, if in fact the said consideration was the total considerationreceived by PW.17 in respect of sale transaction, naturally a question would arise as to how PW.17 would have repaid the advance received by her in respect of very same transaction. It is not the case of either of the parties that PW.161 was repaid Rs.1,75,000/- after encashment of the D.D. In all probability, PW.161 would not have signed the sale deed as witnesses if the advance consideration paid by him was not refunded to him before the registration of sale deed. Therefore, the testimony of PW.161 appears to be nearer to the truth. In this context, the answers elicited from the mouth of PW.161 in the course of the cross- examination that the sale agreement was returned to the vendor appears to be probable and leads to the inference that, on refund of Rs.1,75,000/- on the execution of the sale deed the agreement of sale was returned to the vendor. There is nothing unnatural in the conduct of PW.161 and probabilities also suggest that he would not have allowed the sale to go through without getting the refund of the money paid by him. Accused have not brought on record any circumstance to show that, PW.161 has any reason to give false evidence against the accused taking upon himself the contractual relationship with PW.17. Therefore, taking into consideration the above facts and circumstances, I am not inclined to accept the contention raised by the accused in this regard.

Rs.2,35,813.00 allotment of plot No.L-66, (Old No.524 N) Anna Nagar, Chennai-40, in favour of Tmt. J. Elavarasi PW.128 Balakrishnan, Asst. Secretary, TamilNadu Housing Board has deposed that, as per Ex.P.718, Plot No.E-83, Besant Nagar was allotted to A-3. Ex.P.720 is the order of allotment. Ex.P.721 is the application submitted by A-3. Along with the application, address proof, income certificate and declaration that applicant is the wife and children, do not own any house or plot at any other place were required to be furnished and accordingly A-3 submitted the declaration and age proof and income certificate. In the income certificate Ex.P.732, the yearly income of A-3 is shown as Rs.44,000/- and as per Ex.P.724, the Tahsildar has certified that A-3 is residing at No.18, Balamuttukrishnan Street, Chennai-17. An allotment order was passed determining the total value of the plot at Rs.2,88,750/-. It was paid on 30.07.1992 as per Ex.P.725. The registration fee also was paid. The ownership was delivered. As per Ex.P.728, the Surveyor delivered the possession to A-3.

This witness further deposed that as per Ex.P.719 HIG Plot No.10, Egmore-374, Alwar Pet, Chennai wasallotted to A-4 and again Plot No.524 was allotted instead of the earlier allotment as per Ex.P.729. Ex.P.730 is the application submitted by A-4. Along with the said application she submitted the income certificate as per Ex.P.732. Address proof as per Ex.P.733 and two certificates issued by the Tahsildar. As per Ex.P.732 the yearly income of A-4 was Rs.48,000/-. The total value of the plot is Rs.2,34,813/-The amount was paid as per Ex.P.735. The possession was delivered on 23.10.1992 as per Ex.P.736. On 25.02.1993 no objection certificate was granted to her to construct a residential house in the said plot.

In the cross-examination it is suggested to PW.128 that the site allotted to A-3 is still with the Housing Board and the money paid by A-3 should be returned. PW.128 denied the said suggestion. The allotment and the payment made by A-3 and A-4 in respect of the above allotment and the declarations given by them regarding their address and income status has not been disputed in the cross-examination. Hence the accused are not entitled for return of the amount.

It is the argument of the learned Counsel for A-2 that the evidence of PW.45 is hearsay evidence andtherefore no credence could be given to his evidence. Tmt. Sucharita is not examined by the prosecution. No document is produced regarding the deposit of cash to the Bank account of Nageswara Rao on that day as spoken by the witnesses and therefore, the prosecution is not entitled to take into account any amount other than what is shown in the sale deed Ex.P.105 to P.110 and hence the entire amount of Rs.76,00,000/-included in item No.159 is liable to be deducted.

I have gone through Ex.P.111 to P.120. They are the copies of the current account pay-in slips for cash deposits. According to PW.44, he himself wrote these pay- in slips in his hands as instructed by Tmt. Sucharita. But, on perusal of these documents, it is seen that, Ex.P.111 and P.112 are dt. 1.2.95. Ex.P.113 to P.119 are dated 28.2.95 and Ex.P.120 is dated 18.3.95. These pay-in slips stand for different amounts. Ex.P.111 dated 18.3.95 stands for Rs.14,50,000/-. According to PW.43, the sale deeds Ex.P.105 to P.110 were executed on 19.3.95 i.e., on a Sunday. He has no where stated in his evidence that the cash consideration of Rs.58.73 lakhs was paid to him any time earlier to the date of registration. That being the case, there is no reason for the bank Manager to instruct PW.144 to write the anterior date in the pay-in slips. There is no explanation as to why the different amount is entered in the said pay-in-slips if the entire amount of Rs.58.73lakhs was given to PW.43 on the date of the registration. In this context, it is also pertinent to note that, PW.43 was recalled at the instance of the accused and was subjected to further cross-examination on 29.1.2003 and at that time, PW.43 has given a totally different version about the credit of cash amount into his loan account stating that, by sale of the cameras, he raised Rs.75 lakhs and deposited the money into his account to clear the loan. But even in this regard there is no clear evidence, nonetheless, solely on the basis of the pay-in-slips produced by the prosecution at Ex.P.111 to P.121, it may not be safe to hold that huge sum of Rs.76 lakhs was paid into the hands of PW.43 when he himself was not the owner of the said properties. The owner of the property viz., his sister Ramayi Ammal is not examined before the Court, the Bank Manager is also not been examined. The loan account of PW.43 is not produced before the Court to ascertain the correctness of the statements made by the witnesses. Under the said circumstances, merely on the basis of the fact that PW.43 had filled in the pay-in-slips as directed by the Bank Manager Tmt. Sucharita, it cannot be concluded that a sum of Rs.76 lakhs was paid by the accused towards the cost of acquisition of Luz Avenue property. In this context, it is also relevant to note that the names of the purchaser were not entered in Ex.P.105 to P.110 at the time of registration of these documents. Though the entire transactions appear tobe shoddy and suspicious and it is really shocking to note as to how the Registrar could register the document leaving the name of the purchaser blank. The endorsements made by the Registrar on this document indicate that the purchaser was not present at the time of registration of the document. PW.43 has not stated as to who paid the sale consideration and the cash amount of Rs.58.73 lakhs to him. He has merely stated that, Ramayi Ammal signed the sale deed. Shankar and he put the witness signature. Six blank cheques worth Rs.44 lakhs were given to the bank itself. One cheque for Rs.10 lakhs was given to Ramayi Ammal and an amount of Rs.58.73 lakhs cash was credited to his account. On the basis of the vague and general statement made by PW.43, without there being any corroboration thereto, solely on the basis of his oral testimony, the cost of Rs.76 lakhs cannot be mulct on the accused. Hence this amount shall be deducted from the computation of the assets.

78. III.NEW / ADDL. CONSTRUCTION OFBUILDINGS:

In Sl. No.174, 176 to 191, 301, 302 of Annexure II, the prosecution has listed 19 new/ additional construction said to have been constructed by the accused during the check period. The total value of these constructions come to Rs.28,17,40,430/-. The details of the construction are as under;

174 New/Additional Construction in building Rs.80,75,000/-

at 5 B & C East Coast Road, Door No.4/130 Raja Nagar, Neelankarai, Chennai-41 (Ref. Doc.No.4752/93 Of S.R.O. Adyar)Evaluation Report 176 New/ Additional construction in Farm 1,25,90,261.00 House Bungalows at Payannur in Chengai Anna District.

New/ Additional Construction building 177 at 2,13,63,457.00 Door No.48, Jawaharlal Nehru Road, Industrial Estate, Guindy, Ekkatuthangal, Chennai (M/s. Anjaneya Printers (P) Ltd., Printers) 178 New/ Additional Construction in the 1,52,59,076.00 residential building at D.No.3/178C Vettuvankeni, Chennai 179 New/ Additional construction in the 6,40,33,901.00 building at the Grape Garden Farm House, in the limits of Jeedi Metla and Petpesherabad Villages in A.P.

New/ Additional construction in the 180 posh 5,40,52,298.00 Bangalow at Siruthavur in Chegai MGR Dist.

181 New/ Additional construction in the 7,24,98,000.00 residential building at D.No.36, Poes Garden, Chennai - 86.

182 New/ Additional construction in building 29,59,000.00 at 149, 150 of TTK Road, Chennai - 18.

183 New/ Additional construction in building 80,36,868.00 at Sea Shell Avenue No.2/1-B-3 Apartmen t Sholinganallore Saidapet, Taluk.

residential building at No.L/66, Anna Nagar, Chennai New/ Additional Construction in 187 Building 10,92,828.00 at Door No.5, Murugesan Street, T.Nagar, Chennai-17 188 New/ Additional Construction in 53,11,000.00 residential building (4 Nos) in the campus at No.1/240, Enjambakkam, in New Mahabalipuram Road.

189 New/ Additional Construction in 20,38,959.00 residential Building at No.1, Murphy St., Akkarai, Chennai.

Buildings and the change of roof for the works shed at MF-9, Guindy Industrial Estate, Chennai-32.

301 Cost of renovation and additional 39,34,000.00 construction between June 1992 and 1993, of the building at Plot No.102, ITI Cross, Road, Pon Nagar, Trichy, owned by Tmt. N. Sasikala (covered by Document No.2256/90 dt. 3-5-90 of S.R.O.T. O.R.B., Trichy) 78.33) In the instant case, there cannot be any dispute that, the Engineers examined by the prosecution are competent to estimate the valuation of the structures. The accused themselves have relied on the valuation report prepared by the P.W.D. Engineers, who were part of the team to controvert the reports prepared by the prosecution witnesses. It is not explained by the prosecution as to why the reports prepared by DW.78 and DW.83 are preferable to the reports prepared by the entire team which are proved in a Court of law. Undisputedly, the actual cost incurred for the constructions is within the knowledge of theaccused. It has come in evidence that, contractors and architects were appointed in connection with the construction. The learned Counsel for A-4 himself has referred to the payment made to the architect, who is examined by the accused as DW.88. Under the said circumstance, instead of relying on the reports of DW.78 and DW.83, the accused could have very well produced the actual bills for having purchased the materials and could have examined the contractors and the persons who supplied the materials in proof of the actual cost incurred for the constructions.

78.34) It is pertinent to note that the accused do not dispute the measurement of the buildings and the nature of the constructions and the quality of the materials used therein. The witnesses examined by the prosecution have specifically deposed about the use of high quality marble and exquisite decorative articles and use of teakwood for the doors and windows and for other purposes. No doubt it is true that the prosecution has not produced any direct evidence in proof of the cost of these special items and has solely relied on the oral testimony of the above witnesses who have merely stated that they ascertained the price of the marbles and other special items from the market. But, it should not be forgotten that the special items having been procured by the accused from the concerns known to them, the price paid thereto is specially within the knowledge of the accused. Having regard to the burden cast on the accused in view of the provisions of Sec. 13(1)(e) of the Act, which requires the accused to offer satisfactory explanation when the existence of assets are proved by the prosecution, the accused were not prevented from adducing necessary evidence to show that the value of the special items quoted by the prosecution is more than the price paid by them in respect of these special items.

78.35) No doubt it is true that, an attempt is made by the accused to prove the cost of the marbles by examining DW.96 and through him, the copies of invoices are marked as Ex.D.210 series. But, on going through his evidence, it is seen that the rates furnished by him relate to the year 1999, whereas, the buildings in question are proved to have been constructed between 1994 and 1996. Therefore, even the rates spoken to by DW.96 cannot be accepted. The invoices produced by this witness do not tally with the description of the marbles noted in the respective valuation reports. Therefore, I do not find any justifiable reasons to accept the arguments of the learned counsel for the accused regarding the valuation adopted by the prosecution. However, as the prosecution has not produced convincing evidence in support of the value fixed by the PWD Engineers in respect of the value of the special items and there beingsome dispute regarding the payments of the architect's fees, in order to meet the ends of justice, it would be proper to reduce the overall cost of constructions by 20% of the total estimation given by the prosecution witnesses. In this way, by reducing the total cost of constructions by 20%, the cost of the new and additional constructions of the buildings effected by the accused during the check period is determined at Rs.22,53,92,344.00.

Under the heading of 'Gold and Diamond Jewellery', the learned Sessions Judge at paragraph 79.18 has observed as under:

79.18) Thus, what emerges from the above evidence is that, at the commencement of the check period, A-1 was in possession of only 7040 grams of gold jewellery. As already noted above, A-1 herself has admitted in the wealth returns that, increase in the value of jewellery is on account of the jewellery received as gift during the year. This declaration presupposes that during the year 1992, A-1 had received gold jewellery. Under the said circumstance, she is estopped from contending that all the jewellery seized by the prosecution was in her possession before commencement of the check period. This conclusion gets fortified from the testimony of PW.155 who has categorically stated before the Court that, he was called to prepare the valuation report only in November, 1992 and as required by A-1 and A-2, he prepared different valuation report for the relevant years commencing from 1986-87, even though the bills for the purchase of the said jewellery were not produced before him. From the evidence of this witness, it stands established that the valuation reports were prepared only for the purpose of submitting the wealth tax returns in the year 1992 by segregating the articles for the previous years at the whims and fancy of A-1. Admittedly, A-1 was not in possession of any bills for purchase of this gold anddiamond jewellery as on the date of filing the wealth returns. There is also no explanation by the accused as to how the gold was accumulated during the years. Under the said circumstances, merely because the wealth tax returns were filed by her before the initiation of the criminal proceedings does not exonerate her of her liability to explain the source of the huge quantity of gold and diamond articles. Even during the trial, A-1 has failed to furnish any satisfactory explanation except stating that all the jewellery were in her possession from the commencement of the check period. But the evidence discussed above proves it otherwise.

79.19) Another important aspect that emerges from the evidence of PW.155 and PW.179 is that, Ex.P.1014 to Ex.P.1016 valuation reports were prepared in the name of A-2 in order to facilitate her to file wealth returns in her name in respect of the gold ornaments described threin. There is no evidence as to when and how A-2 acquired these gold and diamond articles. It has come in evidence that her husband was in Govt. service till 1991. If so, in all probability, the source for acquisition of these assets would have been available with A-2 and could have been produced before the Court to explain her ownership over these jewellery. The fact that in 1992 while preparing the valuation reports in relation to the gold jewellery possessed by A-1, separate valuation reports were prepared in thename of A-2 leads to the inference that in order to avoid the large scale disclosure of the gold and diamond jewellery possessed by A-1, some of these items were declared in the name of A-2. This amounts to a serious instance of abetment and conspiracy alleged against the accused. The very fact A-2 is unable to explain the source of acquisitions of these valuables, it could be presumed that A-2 has aided and abetted A-1 in holding the said assets in her name.

79.20) From the above evidence, the prosecution has proved the seizure of gold and diamond jewellery of the total weight of 27588 grams. But as it is proved in evidence that 7040 grams of gold and diamond jewellery were in possession of A-1 prior to the check period, the said quantity is required to be left out from the total computation of the value of the gold and diamond jewellery found in the possession of A-1. Thus, the total weight of the gold jewellery found in the possession of A-1 as on 30.04.1996 comes to 20548 grams.

79.21) Regarding the valuation of the gold as in 1992, we have the reliable material in the assessment order Ex.P.2206, wherein, the assessing officer has adopted the rate of gold as on 1991-92 at Rs.4,334/-per 10 grams. The learned counsel for A-1 has produced the copy of Circular No.646 dt. 15.03.1993 issued under Rule 19 of Sch. III of Wealth Tax Act,wherein, the same rate is published by the concerned authorities. Thus, the value of 20548 grams of gold found in possession of A-1 during the check period is calculated as below:

20548 x Rs.433/- = Rs.8,90,55,032/-

It has come in the evidence of PW.125 that, while valuing the gold, he did not add the making charges and wastages and took into consideration only the value of the gold and to fix the value of the diamonds he took into consideration the cutting, colour carat weight. He has further stated that, first he weighed the ornaments and then deducted the approximate weight of the stones and accordingly determined the weight of the gold and its values. This witness has separately given the value of the diamonds at Rs.2,43,92,790/-. Since the gross weight of 7040 grams is deducted, the proportionate value of the diamonds comes to Rs.1,62,61,820/-. Thus, adding this figure to the value of the gold as above, the total value of the gold and diamond jewellery found in the possession of A-1 during the check period comes to Rs.2,51,59,144/-.

With regard to Silver, the learned Sessions Judge at paragraph 80.9 has observed that, in the wealth tax returns filed by her as per Ex.P.2179 she has categorically admitted that silverwares were received as gifts during the year. This declaration is consistent with the case of the prosecution that, the additional silverware amounting to 416 kgs were acquired by her during the check period. A-1 has not produced any reliable evidence in proof of the source for acquisition of the silverware. As a result, it could be safely inferred that 416 kgs of silver is the illegal acquisition of A-1.

80.10) PW.125 has valued the silver at the rate of Rs.5,000/- per kg. whereas, in the Wealth Tax assessment order relied on by the accused, the silver is seen to have been valued at Rs.6,646/- per kg. Since the rate adopted by PW.125 is advantageous to the accused, adopting the said rate, the value of 416 kgs. of silver is assessed at Rs.20,80,000/- which is added to the over all assets of A-1 acquired during the check period.

The trial Court has computed the value of the fixed deposits and shares amounting to Rs.3,42,62,728/-. 258 Fixed Deposit in Canara Bank 16,03,545.00 Mylapore in the name of Selvi J.

Jayalalitha under Kamadenu Deposit.

(KDR No.950485 dt 27.5.94) 259 F.D. in Canara Bank Mylapore in the 1,49,544.00 name of M/s. Jaya Publications under Kamadenu Deposit (KDR No.941263 dt. 19.9.94) 260 F.D. in Canara Bank Mylapore in the 5,00,000.00 name of M/s. Jaya Publications under Kamadenu Deposit (TDR No.649868 dt. 20.4.95) 261 F.D. in Canara Bank Mylapore branch 71,218.00 in the name of M/s. Jaya Publications (KDR /941261 dt. 19.9.94) 262 F.D. in IB, Abirampuram in the name 5,00,000.00 ofM/s. Super Duper (P) Ltd., (TDR/649865 dt. 25.3.95) 263 -do- 5,00,000.00 (TDR/649866 dt. 25.3.95) 264 -do- 5,000000.00 (TDR/ 649867 dt. 25.3.95) 265 F.D. in Kothari Oriental Finance in the 1,00,000.00 name of A-1 (FDR No/ 47740 dt. 29.8.95) 266 -do- 1,00,000.00 (FDR/ 64280 dt. 29.7.95) By renewal of FDR 48173 267 -do- 1,00,000.00 (FDR 64302 dt. 29.7.95) by renewal of FDR 48172 F.D. in Sriram investments in the 268 name 3,00,000.00 of A-1 by renewal of FDR (F-1945) renewed from F.D. 19451 (47437 dt 29.5.91) 269 -do- 30,00,000.00 (5006835 dt 9.8.94) By renewal of FDR / 5006345 F.D. in Sriram Investments in the 270 name 15,00,000.00 of A-1 (5007694 dt 12.9.94) 271 -do- 5,00,000.00 By renewal of FDR No. F 71533 and F 21330 which is to mature on 29.1.98 Dt 29.12.94 272 -do- 15,00,000.00 5015594 dt 22.3.95 273 -do- 10,00,000.00 5015955 dt 22.3.95 274 -do- 20,00,000.00 5025367 dt 19.10.95 Oxygen and Acetylene Company Ltd., Coimbatore by A-1's mother.

CBI, Secunderabad, after renewal of earlier MIDRs 66/9, 68/33 and 60/9.

SB A/c. No.20614 306 Amount deposited in the name of 38,421.00 Master Vivek in Indian Bank, (on receipt of terminal benefits of his father Tr. V. Jayaraman) Total 3,42,62,728.00

82. VII) CASH BALANCE IN BANK ACCOUNTS:

Item Nos.193 to 229, 296, 300-304 PW.162-Subramaniam, Sr. Manager, Canara Bank, Mylapore Branch, PW.182-Arunachalam, Chief Manager, Indian Bank, Abirampuram Branch and PW.201-C.K.R.K. Vidhya Sagar, officer, Canara Bank,Mylapore Branch, have spoken about each of these items with reference to the extract of the statement of accounts which are marked in evidence and are not disputed by the accused. Hence, the entire cash balance in the bank accounts of the accused amounting to Rs.97,47,751.32 is taken into account.

Abhiramapauram opened on 12.9.1994 in the name of Master J. Vivek, S/o J. Elavarasi, 194 Cash balance as on 30.4.1996 of C.A. No. 167.20 1134 of Indian Bank, Abhiramapuram opened on 23.11.1994 in the name of J. Elavarasi (Signora Business Enterprises, 195 Cash balance as on 30.4.1996 of C.A. No. 771.26 1071 of Indian Bank, Abhiramapuram opened on 11.3.1994 in the name of N. Sasikala (Fresh Mushrooms Prop.) 196 Cash balance as on 30.4.1996 of C.A. No. 85,342.25 1107 of Indian Bank, Abhiramapuram opened on 31.8.1994 in the name of J. Elavarasi (Lex Property Development (P) Ltd., 197 Cash balance as on 30.4.1996 of C.A. No. 1,32,221.00 1068 of Indian Bank, Abhiramapuram opened on 30.3.1994 in the name of V.N.

Sudhakaran, 198 Cash balance as on 30.4.1996 of C.A. No. 19,29,561.58 2018 of CB, Mylapore opened on 12.10.1990 in the name Selvi J. Jayalalitha, of 199 Cash balance as on 30.4.1996 of C.A. No. 3,40,527.95 1171 of Indian Bank, Abhiramapuram opened on 28.3.1995 in the name of J. Elavarasi.

2277 of CB, Mylapore opened on 10.11.1993 in the name of M/s Metal King in which Sasikala is the proprietrix 202 Cash balance as on 30.4.1996 of C.A. No. 1,889.28 2196 of CB, Mylapore opened on 1.12.1992 in the name of Tmt. Sasikala 203 Cash balance as on 30.4.1996 of C.A. No. 20,79,885.12 2047 of CB, Mylapore opened on 26.9.1990 (on transfer Form Kellys Branch) in the name of Jaya Publications in which Selvi J.

Jayalalitha &Tmt. N. Sasikala are the partners, 204 Cash balance as on 30.4.1996 of SB Acc. No. 1,095.60 23218 of CB, Mylapore opened on 23.5.1990 in the name of Tmt. N.

Sasikala, 205 Cash balance as on 30.4.1996 of CA No. 3,17,232.21 1245 of CB, Guindy opened on 2.1.1995 in the name of Tmt. N. Sasikala (Metal King), 206 Cash balance as on 30.4.1996 of CA No. 47,453.64 2220 of CB, Mylapore opened on 7.4.1993 in the name of V.N. Sudhakaran, 207 Cash balance as on 30.4.1996 of CA No. 3,17,475.64 1689 of CB, Anna Nagar (East) opened on 1.12.1993 in the name of V.N. Sudhakaran (Maha Subhalakshmi Kalyana Mandapam), 208 Cash balance as on 30.4.1996 of SB Acc. 61,430.00 No. 24621 of CB, Mylapore opened on 25.2.1992 in the name of V.N. Sudhakaran, 209 Cash balance as on 30.4.1996 of C.A. No. 1,760.00 1179 of Indian Bank, Abhiramapuram opened on 5.5.1995 in the name of Jaya Finance Pvt., Ltd., 210 Cash balance as on 30.4.1996 of C.A. No. 1,18,198.00 2219 of CB, Mylapore opened on 7.4.1993 in the name of J. Elavarasi, 211 Cash balance as on 30.4.1996 of SB Acc. No. 894.00 25389 of CB, Mylapore opened on 23.1.1993 in the name of J. Elavarasi, 212 Cash balance as on 30.4.1996 of CA No. 560.55 2133 of CB, Mylapore opened on 3.2.1992 in the name of Tmt. N. Sasikala, 213 Cash balance as on 30.4.1996 of CA No. 10,75,335.64 2250 of CB, Mylapore opened on 29.7.1993 in the name of Tmt. N. Sasikala & V.N.

Sudhakaran (i.e., Anjaneya Printers), 214 Cash balance as on 30.4.1996 of CA No. 4,59,976.22 2061 of CB, Mylapore opened on 21.3.1991 in the name of Selvi J. Jayalalitha &Tmt. N. Sasikala (M/s Sasi Enterprises), 215 Cash balance as on 30.4.1996 of C.A. No. 167.55 1050 of Indian Bank, Abhiramapuram opened on 27.1.1994 in the name of M/s Jaya Real Estate 216 Cash balance as on 30.4.1996 of C.A. No. 5,46,577.50 1152 of Indian Bank, Abhiramapuram opened on 25.1.1995 in the name of Tmt. N.

Sasikala & V.N. Sudhakaran (i.e., Super Duper TV Pvt., Ltd.,) 217 Cash balance as on 30.4.1996 of C.A. No. 1,838.00 1059 of Indian Bank, Abhiramapuram opened on 27.1.1994 in the name of Tmt. N.

Sasikala & V.N. Sudhakaran (M/s JJ Leasing & Maintenance), 218 Cash balance as on 30.4.1996 of C.A. No. 13,671.80 1062 of Indian Bank, Abhiramapuram in the name of Tmt. N. Sasikala, Tmt. J. Elavarasi & V.N. Sudhakaran (M/s JS Housing Corpn.), 219 Cash balance as on 30.4.1996 of C.A. No. 146.70 1058 of Indian Bank, Abhiramapuram opened on 27.1.1994 in the name of Tmt. N.

Sasikala (M/s Green Garden Apartments Farm House), Tmt. J. Elavarasi & V.N.

Sudhakaran, 220 Cash balance as on 30.4.1996 of C.A. No. 10,891.00 1049 of Indian Bank, Abhiramapuram opened on 27.1.1994 in the name of Tmt. N.

Sasikala, V.N. Sudhakaran &Tmt. J.

Elavarasi (M/s Jaya Contractors & Builders), 221 Cash balance as on 30.4.1996 of C.A. No. 1,02,490.18 1044 of Indian Bank, Abhiramapuram opened on 15.12.1993 in the name of Selvi J.

Jayalalitha &Tmt. N. Sasikala (M/s Sasi Enterprises), 222 Cash balance as on 30.4.1996 of C.A. No. 1,02,490.00 1149 of Indian Bank, Abhiramapuram opened on 23.3.1995 in the name of V.N.

Sudhakaran, Tmt. J. Elavarasi &Tmt. N. Sasikala (M/s Sakthi Construcitons), 223 Cash balance as on 30.4.1996 of C.A. No. 1,02,490.18 1146 of Indian Bank, Abhiramapuram opened on 23.3.1995 in the name of Tmt. N.

Sudhakaran (M/s Lakshmi Constructions), 225 Cash balance as on 30.4.1996 of C.A. No. 358.70 1113 of Indian Bank, Abhiramapuram opened on 13.9.1994 in the name of V.N.

opened on 6.8.1994 in the name of Tmt. J. Elavarasi & V.N. Sudhakaran (M/s M/s.

Riverway Agro Products (P) Ltd.) 227 Cash balance as on 30.4.1996 in the BOM, 2,05,152.06 Anna Nagar (vide SB Acc. No. 5158) opened on 28.2.1990 in the name of Selvi J.

Jayalalitha, 228 Cash balance as on 30.4.1996 in the CBI of 3,84,760.67 Secunderabad in SB Acc. No. 20614 opened on 19.5.1989 in the name of Selvi J.

Jayalalitha, 229 Cash balance as on 30.4.1996 in the CBI of 2,34,000.00 Secunderabad in SB Acc. No. 23792 opened on 29.1.1993 in the name of Tmt. N.

Sasikala, 296 Cash balance as on 30.4.1996 in CDS-ITP 21,380.00 Acc. No. 32 of Selvi J. Jayalalitha in CBI, T. Nagar Branch, Chennai, 300 Cash balance as on 30.4.1996 in SB Acc. No. 17,502.98 38746 of CB, Kellys Branch opened on 30.12.1988 in the name of Tmt. N. Sasikala. 304 Cash balance as on 30.4.1996 in CA No. 5,10,968.16 1952 of CB, Mylapore of Namadhu MGR.

TOTAL 97,47,751.32 82.1) In proof of the above items, the prosecution has marked the following documents:

True copy of statement of account of SB No. 4110 193 1138 in Indian Bank, Abhiramapuram, Madras for Master Vivek from September, 1994 to January, 1996; Statement of account of CA No. 1134 of M/s 194 1318 Signora Business Enterprises (P) Ltd., in Indian Bank, Abhiramapuram Branch from 23.11.1994 to 7.5.1996;

True copy of statement of account of CA No. 1068 195 1117 in Indian Bank, Abhiramapuram, Madras from March, 1994 to April, 1995 for M/s Fresh Mushrooms; 196 1324 Statement of account of CA No. 1107 of M/s. Lex Ltd.

Property Development (P) , Property Development (P) Ltd., in Indian Bank, Abhiramapuram from 31.8.1994 to 7/1996; 197 1111 True extract of statement of account of V.N.

Sudhakaran in CA No. 1068 in Indian Bank, Abhiramapuram Branch;

198 1382 Statement of account of CA No.2018 of A-1, dt.

1.4.1994 in Canara Bank, Mylapore from 1.7.1991 to 12.9.1999;

199 1109 True extract of statement of account of J. Elavarasi in C.A. No. 1171 in Indian Bank, Abhiramapuram Branch;

Xerox copy of statement of account of CA No. 200 1377 23832 of A-1 in Canara Bank, Mylapore from 16.4.1991 to 2.8.1999;

True extract of statement of account of CA No. 201 2081 2277 of M/s Metal King in Canara Bank, Mylapore from 11.11.1993 to 23.9.1996;

Statement of account of CA No. 2196 in the name 202 1519 of A-2 in Canara Bank, Mylapore from 1.12.1992 to 30.11.1993 ;

203 1903 Statement of account of CA No. 2047 of M/s Jaya Publications in Canara Bank, Mylapore from 1.7.1991 to 11.9.1996;

204 1510 Statement of account of SB No. 23218 in the name of A-2 in Canara Bank, Mylapore from 23.5.1990 to 28.4.1997;

205 2081 Statement of account.

206 1576 Statement of account of A-3of Acc. No. FGCA 2220 in Canara Bank, Mylapore from1.4.1994 to 10.4.1999;

207 1966 Statement of account of CA No. 1689 of Maha Subhalakshmi Kalyana Mandapam in Canara Bank, Anna Nagar (East) from 27.8.1993 to 31.12.1996; Statement of account of V.N. Sudhakaran of SB 208 1572 Acc.

No. 24621 in Canara Bank, Mylapore from 25.2.1992 to 2.8.1999;

True extract of statement of account of Jaya 209 1106 Finance Pvt., Ltd., in C.A. No. 1179 in Indian Bank, Abhiramapuram Branch;

210 1618 Statement of account of A-4 in CA No. 2219 in Canara Bank, Mylapore from7.4.1993 to 16.7.1996; 211 1613 Statement of account of A-4 in SB Acc. No. 25389 inCanara Bank, Mylapore from 23.1.1993 to 2.8.1999;

212 2031 Statement of account of CA No. 2133 of M/s Vinod Video Vision in Canara Bank, Mylapore from 3.2.1992 to5.1.2000;

213 2088 True extract of statement of account of C.A. No. 2250 of M/s Anjaneya Printers Pvt., Ltd., in Canara Bank, Mylapore from 29.7.1993 to 5.1.2000;

214 1940 Statement of account of CA No. 2061 of M/s Sasi Enterprises in Canara Bank, Mylapore from 1.8.1991 to 18.10.1996;

True copy of statement of account of Jay Real 215 1160 Estate in C.A. No. 1050 in Indian Bank, Abhiramapuram Branch from 27.1.1994 to 31.3.1996;

216 1034 True copy of statement of account of Super Duper TV Pvt., Ltd., in CA No. 1152 in Indian Bank, Abhiramapuram Branch from January, 1995 to May, 1996;

217 1036 Pay-in-slip of Indian Bank, Abhiramapuram Branch, Madras of Rs. 5,73,000/- to the credit of Super Duper TV Pvt., Ltd., in CA No. 1152 by Ram Vijayan, dt. 22.2.1995;

218 1170 Statement of account of CA No. 1062 of JS Housing Development in Indian Bank, Abhiramapuram Branch from January, 1994 to September, 1997; True copy of statement of account of CA No. 1058 219 1189 of Green Farm Houses in Indian Bank, Abhiramapuram Branch from 27.1.1994 to 21.7.1996;

220 1248 Statement of account of CA No. 1049 of Jaya Contractors and Builders in Indian Bank, Abhiramapuram Branch from 27.1.1994 to 31.3.1994;

221 1255 Statement of account of CA No. 1044 of Sasi Enterprises in Indian Bank, Abhiramapuram Branch from 14.7.1995 to 13.7.1996;

222 2016 Statement of A/c.

223 1974 Statement of A/c.

224 1980 Statement of A/c.

225 1266 Statement of account of CA No. 1113 of Meadow Agro Farms Pvt. Ltd., in Indian Bank, Abhiramapuram Branch from 13.9.1994 to 23.7.1995;

226 1298 Statement of account of CA No. 1095 of M/s Riverway Agro Products (P) Ltd., in Indian Bank, Abhiramapuram Branch from 6.8.1994 to 25.6.1996;

227 1560 Cheque for Rs. 399/- of Canara Bank, Mylapore in favour of United India Insurance Co., by A-2 in CA No. 2196, dt. 22.8.1995;

228 936 Statement of account of SB No. 20614 of Central Bank of India, Secunderabad in the name of Ms. Jayalalitha from 25.3.1991 to 2.5.1997; 229 937 Statement of account of SB No. 22792 Central Bank of India, Secunderabad in the name of N. Sasikala from 29.1.1993 to 17.9.1996;

300 975 True xerox copy of extract of SB Acc. No. 38671 of Canara Bank, Kellys Branch, Madras in the name of 977 J. Jayalalitha;

True xerox copy of extract of SB Acc. No. 38746 of Canara Bank, Kellys Branch, Madras in the name of Mrs. Sasikala;

304 1635 Statement of account of M/s Namadhu MGR in CA No. 1952 in Canara Banka, Mylapore from 1.7.1991 to 30.4.1996;

The learned Sessions Judge has discussed at para- 83 VIII) Vehicles pertaining to item Nos.230-257, 299. The learned Sessions Judge has assessed the value of about 40 vehicles. The costliest vehicle amongst these is Mercedes Benz (TN-09/P-6565) and cost of the same is Rs.9.15 Lakh. Total value amounts to Rs.1,29,94,033.05. This amount is accepted.

Para-84 of the impugned judgment deals with IX) Machineries pertaining to Item Nos.293, 294. PW.115 - Mariyappan, employee of P.W.D. at the relevant time has been examined in proof of the above items. According to him, there were 55 machines in Anjaneya Printers (P) Ltd., and 19 machines in Metal King.

DW.89 - T. Ananthakrishnan, Manager of M/s.Anjaneya Printers (P) Ltd., has deposed that the Company were carrying on business of printing Government school books, posters, brochures, AIADMK Party's posters, books etc., Out of 37 machines available in the said premises, 19 machineries were owned by M/s. Anjaneya Printers (P) Ltd., and 15 machines were taken on hire from Shastri Nuts, Plates Manufacturers Pvt. Ltd., and 3 machines were taken from Jaya Publications. This witness has deposed regarding other machineries purchased by M/s. Anjaneya Printers (P) Ltd., and through this witness, the copies of the invoices dated 22.10.1993 came to be marked as Exs.D.236, D.237 and D.238.

Ex.D.236, D.237 and D.238 are dated 22.10.1993. Though these invoices are stated to have been issued by Uni Off-set Printers, Amar Enterprises and Ideal Packaging, the signatures on the invoices appear to be similar in all the three invoices leading to doubt their authenticity. In Ex.D.236, even though number of equipments are listed, a sum of Rs.6 lakh only is shown against the cost of the generators and the cost of the other machineries are not mentioned therein. There is absolutely no material to show that items shown in these invoices are delivered to M/s. Anjaneya Printers (P) Ltd., In order to persuade the Court to believe that these invoices are authentic and the purchases made thereunder are genuine, the learned Counsel for the accused has referred to the bank statement relating to M/s. Anjaneya Printers (P) Ltd., (A/c.No.2250) produced by the prosecution, marked as Ex.P.2088 and it is emphatically submitted that the amount shown in the said invoices are duly paid to the said concerns as per the above statement of accounts. But, the said Ex.P.2088 shows that the sum of Rs.6,72,000/-, Rs.8,96,000/- and Rs.4,48,000/- are paid to Uni Off-set Printers, Ideal Packaging, Amar Enterprises on 23.09.2009. It is not the case of the accused that, the payment for the machineries were made in advance and thereafter the invoices were obtained for the purchase of machineries. This goes to show that an attempt is made to fabricate invoices corresponding to the payments made to the aforesaid concern appearing to be the purchase transactions.

Now coming to the payment of Rs.53 lakhs said to have been made to Tamil Arasi Achagam as per the invoice marked as Ex.D.276 (again a zerox copy), the learned Counsel for the accused has relied on the Ex.P.1226, wherein an entry dated 25.06.1994 reads that, Rs.40,96,565/- is credited to the loan account of Tamil Arasi by clearing the cheque bearing No.009. The said cheque is marked as Ex.P.1238 and is seen to have been drawn towards the repayment of loan account of Tamil Arasi and Ex.P.1239, another cheque dated 22.6.1994 is issued by M/s. Anjaneya Printers (P) Ltd., in the name of Indian Bank A/c. Tamil Arasi. But as already stated, these cheques are dated 22.6.94, but the invoice Ex.D.276 is dated 28.05.1995 for Rs.53 lakhs. Though it is argued that the amounts of the cheques Ex.P.1238 and P.1239 amount to Rs.53 lakhs, the invoice Ex.D.276 dated 28.5.1995 cannot be co-related to the above cheque payments. This invoice Ex.D.276 appears to have been got up later.

While appreciating the contention urged by the accused, another important aspect to be taken note of is that, the bank account of M/s. Anjaneya Printers(P) Ltd., was opened only on 23.01.1994 with a cash deposit of Rs.501/-. The said C.A. No.1053 maintained by M/s. Anjaneya Printers (P) Ltd., with Indian Bank, Abirampuram Branch, contains the following credit entries. Date : 23-01.94 - By Cash - Rs.15 lakhs Date : 19.02.94 - Clearing - Rs. 34,000/- Date : 25.06.94 - By Transfer - Rs. 13 lakhs.

In the light of the above evidence, the documents produced by DW.89 are analyzed, it is seen that, Ex.D.235 is the zerox copy of the certificate said to have been issued by N. Nallamuttu, Dy. Inspector General of registration confirming that, stamp paper bearing Sl. Nos. 4163 to 4166 and 4170 dated 5.7.98 were sold to Tr. Vasudevan. The said document does not establish anything. Ex.D.236 to D.238 are the zerox copies of the invoices dated 22.10.1993 issued by Uni Off-set Printers, Amar Enterprises and Ideal Packaging.These documents are not proved in accordance with law either by producing the copy of the invoices or by examining the persons who issued the said invoices. As already stated above, DW.89 in the cross-examination has admitted that, after taking the lease of the premises, M/s. Anjaneya Printers (P) Ltd., have purchased the machines from the above Company. For all these reasons, the contention raised by the accused is rejected.

At para-85 of the impugned judgment deals with Footwear. The learned Sessions Judge has made observation at para-85.2 as under:-

Though this evidence may suggest extravagant life lead by the inmates residing at Door No.36, in the absence of clear and definite evidence to show that the said 386 pairs of footwear found in the house were purchased by A- 1 and that, these footwear were exclusively worn by her, A-1 cannot be fastened with the entire cost, especially when it is brought out in the evidence that, in addition to A-1, number of other persons including maids were residing in the house. Prosecution has failed to prove that, the above 386 pairs of footwear were in the possession of A-1 alone. The nature of the property is such, the possession by others cannot be ruled out. That apart, the evidence led in by the prosecution is not sufficient to determine the value of these footwear in the absence of the nature and quality of the footwear, their make, brand and the year of manufacture. Therefore, the entire amount under this head is deducted.

At para-86 of the impugned judgment deals with Sarees. The learned Sessions Judge at para-86.2 has made the following observation:

Admittedly, no one has laid a claim to the sarees seized from the house of A-1. Therefore, the argument of the learned counsel that there is no evidence to show that the seized sarees exclusively belonged to A-1 holds no water. There is no dispute regarding the number of sarees valued by PW.133. Though the number looks stupefying, yet, it should not be forgotten that, prior to joining politics, A-1 was in Cine field, therefore, there is nothing unusual in having a taste for costly and fancy sarees by A-

1. In any case, there being no specific evidence that all the sarees noted in the above observation mahazars were purchased during the check period, it would not be safe to hold that the sarees listed therein were acquired by A-1 during the check period. Hence the value shown under this head cannot be allowed.

Para-87 of the impugned judgment deals with Watches. PW.129 identified the seven wrist watches and specified their valuation as under:

In the cross-examination it is elicited that he did not bring with him either the goldsmith or the diamond appraiser and he does not deal in gold and diamond business. He cannot say in which year the above mentioned wrist watches were manufactured. MO.585 is manufactured by Christian Bernard Company. PW.129 answered that he does not sell this kind of wrist watches in his Company. The Company which manufactures MO.586 has sent the price list to PW.129. MO.589 was manufactured by ROLEX Company in Switzerland. It chain is made of 18 carat gold. In MO.587, 40 diamonds were fixed. These kinds of wrist watches are not sold in India. This witness further answered that his shop has the price list of Rolex Company. MO.589 is RADO wrist watch is made in Switzerland and PW.129 normally does not sell RADO wrist watches. Likewise MO.590 is also made is Switzerland and PW.129 does not have the pricelist of that Company.

This witness was recalled for the second time on 13.12.2012 and it is elicited that he is not qualified to assess the diamond and gold and he did not assess the age of the watches and he does not know whether the watches inspected by him were original or duplicate.

The learned Sessions Judge has observed at para- 87.3 as under:

Based on the above cross-examination the learned Counsel for the A-1 has vehemently argued that, PW.129 having not dealt with the watches manufactured by ROLEX and BADAK PHILIPI viz., MO.587 and MO.590, he is totally incompetent to assess their value and therefore, the valuation of Rs. 3,75,000/- and Rs. 5 lakhs respectively fixed by this witness in respect of MOs. 587 and 590 are liable to be discarded outright. That apart, this witness has admitted in the cross-examination that he is neither a goldsmith nor a diamond appraiser and therefore, the valuation made by him on the basis of the diamonds alleged to have been contained therein cannot be accepted. The learned Counsel also pointed out that the evidence of PW.129 is silent with regard to the year of manufacture which is crucial for determining the price of the watches and more importantly, prosecution has not positively established that A-1 acquired these watches during the check period. It is the submission of the learned Counsel that if in fact these watches were manufactured during the check period, the prosecution could have procured the brochure or the price list from the Company which would have ruled out the possibility of A-1 possessing the said watches prior to the check period. Therefore, it is the submission of the learned Counsel that in the absence of any such evidence, solely on the basis of the oral testimony of PW.129 whose evidence cannot be treated that of an expert; A-1 cannot be called upon to explain the exorbitant valuation shown by the prosecution under this head.

As the learned Counsel for the accused has raised serious objection regarding the valuation of MOs. 587 and 590, it may be necessary to refer to the description of these two articles in MO.739 which reads as follows:

"4 - Rolex Ladies 18k - Rs.3,75,000/-(18 carat gold-750) "Oyster perpetual Date just Superlative Chronometic officially certified" Automatic Date, Beoyel set in 40 real Diamonds and 10 real diamonds on dial with 18k bracelet center second wrist Watch.

Reference Numbers:

Hand engraved number inside the back SIS/95

6. Patek Phillipe Ladies W/watch 18k

- Rs. 5,00,000. (18 carat gold) white enamel dial with Black roman figures case surrounded by real diamonds in 3 rows with 18k Bracelet.

Diamond on button.

Back ref : 2941003 - 4831/1 Caliber E15, Movement No:

1619138"

87.5) Regarding the valuation of 91 wrist watches valued at Rs. 6,87,350/-, the prosecution has examined one Sri.Maran, working in the Sales and Repair Division in BRR and Sons as PW.130. This witness has deposed that, he has experience in assessing the value of wrist watches; he has studied the manufacturing of wrist watches and wall clocks in Guindy ITI. On 18.12.1996 he assessed the 91 wrist watches in the presence of the Inspector Mr. Shankar and the witnesses Sri. Ponnuswamy and Sri. Armugam. A note of proceeding was prepared as per Ex.P.740 and he has subscribed his signature thereto. According to him, the total value of 91 wrist watches assessed by him is Rs. 6,87,350/-. During his evidence he has identified these wrist watches as MOs.682 to 741 and has specified their make and the price. Further, this witness has deposed that, he deals with TITAN, HMT and ACCURATE watches in his shop and therefore he knows the price ofthose watches and in respect of other watches, he came to know the price through the customers who had come to his shop for repair of such watches In the cross-examination it is elicited that he cannot say in which year the assessed watches were manufactured and further he answered that he assessed the value of the watches manufactured by TITAN, HMT and ACCURATE on the basis of the price list and in respect of the watches manufactured by other companies, he assessed them only from his experience.

87.6) The testimony of this witness is also assailed by the learned Counsel for the accused on the ground that his testimony is inadmissible for the reason that this witness cannot be termed as an expert as he has admitted that he determined the price of the watches on the basis of the price disclosed by his customers and therefore no credence could be given to the testimony of this witness and it has to be held that, PW.130 has no expertise or competency whatsoever to fix the valuation of these watches, as a result Ex.P.740 as well as the oral evidence adduced by the prosecution in proof of the valuation of the wrist watches is liable to be discarded in entirety.

87.7) From the above evidence, prosecution has proved that, these watches were in the possession of A-1. It is not the case of A-1 that these watches belong to any other persons. In order to substantiate the charge u/Sec. 13(1)(e) of the Act, the prosecution must prove the nature and extent of the pecuniary resources or property which are found in possession of the accused. Once this ingredient is established, the burden of satisfactorily accounting for the possession of such resource shifts to the accused. Though the standard of proof may not be as heavy as on the prosecution, yet, the explanation offered must be reasonable and plausible. In the instant case, A-1 has not offered any explanation with regard to the possession of the said watches. There is absolutely no mention whatsoever about the acquisition of these costly watches in her wealth returns. A-1 did not offer any explanation at the earliest point of time that these watches were purchased by her prior to the check period. Under the said circumstance, the only inference that could be drawn is that, A-1 purchased these watches during the check period.

87.8) PW.129 and PW.130 have given objective assessment of the watches and have furnished the basis on which they arrived at the rate of the watches which is not shown to be false by producing the purchase bills or any other contra evidence to doubt or disbelieve their evidence. Hence, relying on the evidence of the above witnesses, the entire valuation is accepted.

Para 87.9 of the impugned judgment deals with tabular column of assets as on 30.4.1996 as under:

Nature of assets Item Nos. Value (in Rs.) I Immovable 1-173, 175, 292, 297, 301, 20,07,80,246.00 properties 302(i), 305 (consideration, Less: Item Nos.1-17 cost of regn) Rs.37,00,579 Less: Item No 21, Rs.2,98,144 Less: Item Nos.72-74 Rs.3,35,000 II Cash paid over & 24, 31, 33, 64, 66, 127, 1,58,30,619.00 Above sale 145, 150, 159 consideration Less: Item No.64 Rs.4,65,000 Less: Item No.66 Rs.4,85,000 Less: Item No.150 Rs.10,00,000 Less: Item No.159 Rs.76,00,000 III New or additional 174, 176-192, 301, 302(ii) 22,53,92,344.00 Less: 20% of the total construction of estimate.

The learned Sessions Judge has observed at para- 88.8 that in order to establish the transaction in question is benami, the prosecution could either prove the fact by direct evidence or by circumstantial evidence leading to the inference of that fact. If prosecution is able to prove that there could not have been any other source than the accused himself, offence can be brought home against him. Normal human conduct and presumptions can be utilized for this purpose.

The prosecution has included the properties acquired by the following companies to the account of A-1. The companies are:

(a) M/s. Lex Property Development (P) Ltd.,

(b) Meadow Agro Farms (Pvt) Ltd.,

(c) Riverway Agro Products (Pvt) Ltd.,

(d) M/s. Ramaraj Agro Mills Ltd.,

(e) M/s. Signora Business Enterprises (P) Ltd.,

(f) Indo Doha Chemicals and Pharmaceuticals Pvt. Ltd., The learned Sessions Judge has observed in respect of the Lex Property Development Pvt. Ltd as under:

A perusal of the evidence of PW.182 PW.177, PW.132 PW.127 PW.100 PW.94 and PW.51 coupled with Exs.P.135, P.136, P.569 to P.574, P.647 to P.650, P.717, P.744 to P.763 and P.1005 to P.1008 reveal that M/s. Lex Property Developments Pvt. Ltd., was incorporated under the Companies Act, 1956 on 25.09.1990 with registration No.18-19704 of 1990 with the main objects to carry on the business of proprietors of land, flats, shops, dwelling houses, industrial estates, commercial complexes and to acquire by purchase, lease, exchange, rent or otherwise deal in lands and buildings and any estates and to carry on the business of builders machinery, engineers, general construction and contractors. As per Memorandum of Association Ex.P.568 the company was started by Sri.S.Sreenivasalu Reddy and P.V.Ravikumar as the promoters and the directors of the said company. Initially, the registered office of the company was at No.120, Theyagaraja Road, T.Nagar, Madras which was later changed to No.27, Lake Area, Nungambakkam, Chennai and later to Flat No.A-8, Thomas Road, T.Nagar, by filing Form No.32 as per Ex.P.569.

PW-114 Ravi Kumar has deposed that, he along with Srinivasa Reddy started Lex Property Development (P) Ltd., He had invested Rs.1,000/- and Srinivasa Reddy had invested Rs. 4,500/-. They opened Current A/c. in Indian Bank at Peter's Road. In 1991 Subbirama Reddy was elected as an M.P. and stayed at Delhi. So, he could not commence the business. In June, 1993 he wanted to change the company to his friends. So, he handed over the companies documents and unused cheques to Sudhakar Reddy, who was with Subbarama Reddy. This witness further deposed that, after sometime, Sudhakar Reddy gave him a cheque for Rs.1,000/- and another cheque for Rs.4,500/- in the name of Srinivas Reddy. This witness unequivocally stated before the Court as under;

"We did not buy any properties in the name ofthat Company. Either myself or Srinivas Reddy did not buy any properties in the name of that Company at No.149, TTK Road and No.1 Wallace Garden, 1st Street."

He identified his signature on Ex.P.573 and P.574.

i.e., copies of Memorandum of Association and Articles of Association of M/s. Lex Property Development (P) Ltd.,. The testimony of this witness is not controverted in the cross-examination. Instead, his testimony finds suitable corroboration in the testimony of PW.96.

In the annexure to the auditor's report, it is further stated that the company does not have any fixed assets and the company had neither taken nor given any loans from / to companies, firms or other parties and the company has not accepted deposits from the public. It is also declared that the proper books of account as required by law have been kept by the company. In the balance sheet of the relevant year as on 31.03.1994 the current assets of the company are declared as under;

Land under development :

Cost of Land including Regn. : Rs. 5,70,040/-

89.5) The above documents establish that though the company was started in 1990, it did not commence any profit making activities till the year ending March, 1994 except acquiring an immovable property at No.149, T.T.K.Road, I Cross Road, Sriramnagar, Madras. Form No.32 - Notice discloses that the original directors viz., Mr. S. Sreenivasalu Reddy and P.V.Ravikumar resigned from the board on 29.08.1994 and A-2 and A-3 were appointed as additional directors of the company on 17.08.1994.

According to the prosecution, after A-3 and A-4 assumed the Directorship of the aforesaid company, number of properties were purchased in the name of the company. During trial, the prosecution has got marked the copies of the two sale deeds dated 28.12.1994 (Ex.P.135 and Ex.P.136) executed by Mrs. A. Arifa Amanuallah W/o. M.O.Amanuallah in favour of Lex Prperty Developments Private Limited in respect of the land measuring 11 cents with building comprised in Survey No.74/1 Old No.152 and 152-A situate in Nilangari Village, Saidapet Taluk, M.G.R.District respectively. In proof of the said sale deeds, the prosecution has examined PW.51 the husband of the vendor who has deposed that his father-in-law purchased the aforesaid property in the name of his wife and they built a house therein by spending Rs.11.00 lakhs. A-2 and A-3 agreed to purchase the said lands for Rs.25.00 lakhs and paid Rs. 10.00 lakhs in cash and the remaining Rs.15.00 lakhs was paid by means of two D.Ds for Rs.6,80,000/- and Rs.8,20,000/-. According to PW.51, the Sub-Registrar was brought to his house and his wife executed Ex.P.135 and P.136 before the Registrar. Through this witness, the prosecution has got marked Ex.P.135 and Ex.P.136. Though this witness is cross- examined regarding the payment of Rs.10.00 lakhs in cash, the accused have not disputed the execution and registration of Ex.P.135 and P.136. It is evidenced in these sale deeds that consideration of Rs.6,08,000/- and Rs.8,20,000/- was paid to the vendor by means of demand drafts detailed therein.

In his evidence, PW.100 has stated that Raghavendra Builders and Constructions entered into separate agreement with M/s. Lex Property Developments to construct the buildings and in the transaction the cheques amounting to Rs.30,05,080/- for the two apartments were given in the name of Raghavendra Builders and Constructions.

89.8) Though it is the contention of the accused that Lex Property Development Pvt. Ltd., is an independent entity and the accused do not have anything to do with the said company which is governed by the provisions of the Companies Act, the evidence of PW.132 and the documents marked through this witness viz., Ex.P.743 to P.764 indicate that few months after A-3 and 4 took over the company as the Directors, A-2, A-3 and A-4 formed several partnerships along with the aforesaid Lex Property Developments Pvt. Ltd., as one of the partners. PW.132 who was working as District Registrar in Central Chennai District from 26.08.1993 to May 1995 has deposed before the Court that, on 06.02.1995 he registered the following firms viz., Name of the Firm Names of Partners Principal Place of Business Vigneswara 1. V.N. Sudhagaran Shop No.21, Builders 2. N. Sasikala Wellington Plaza,

3. J. Elavarasi Mount Road, Madras.

89.9) As could be seen from Ex.P.745 to P.760 all these firms were registered on the same day i.e., 15.02.1995 and on behalf of M/s. Lex Property Developments Ltd., A-4 N. Sudhakaran has signed the application as one of the directors of the Company.

89.10) PW.177 Shanmugha Sundaram, the Deputy General Manager of Indian Bank at the relevant time has spoken about the loan availed by M/s. Lex Property Development Pvt. Ltd., The prosecution has produced the original request made by the Lex Property Development Pvt. Ltd., for grant of finance for construction of marriage Hall at No.149, 150 TTK Road as per Ex.P.1328, marked through PW.182. A-3 hassigned this letter requesting for a loan of Rs.133.00 lakhs as project cost and Rs.24.00 lakhs towards the term loan to fund the constructions of the marriage hall. In the letter According to this witness a letter dated 22.09.1994 was received from Abirampuram Indian Bank, Branch to the Regional Office to give long term loan of Rs.133.00 lakhs and term loan of Rs.24,00,000/- to Lex Property Development Pvt Ltd., as per Ex.P.1005. Ex.P.1006 is the recommendation letter of the Branch Manager. These documents were sent from Regional office to Zonal office and the Regional Office sent a letter dated 15.11.1994 to Zonal Manager with recommendation as per Ex.P.1007.

89.11) It is interesting to note that though Ex.P.1005 is said to be application for advance, it is not signed by the applicants or any one on their behalf. As per this document, M/s. Lex Property Developments Pvt. Ltd., is shown as the applicant and the address is shown as Dr. Thomas Road, T. Nagar, Madras and A-3 and A-4 as the Directors of the said firm carrying on the business of property promoters at No.149 and TTK Road, Madras. The purpose of the loan is shown as foracquiring property at No.150 TTK Road and for construction of marriage hall and to settle the loan to the tune of Rs.60.00 lakhs. In the comments it is notedthat the company has not ventured into any project since inception and as against the authorized capital of Rs.5.00 lakhs, the paid up capital remains at Rs.5,500/- and the tangible net worth is negative. In spite of it, the Asst. General Manager is seen to have sanctioned a term loan of Rs.133.00 lakhs to the said concern repayable in 28 equal quarterly installments with interest at 17.75% as per Ex.P.1008. This sanction letter is dated 15.03.1995 and it is mentioned therein that the amount of Rs.45,00,000/- already released by the Branch is to be absorbed in this loan.

89.13) Ex.P.1320 discloses that, the C.A. No.1107 was opened in the name of M/s. Lex Property Development (P) Ltd., only on 31.08.1994. The application Ex.P.1320 is signed by A-3 in his capacity as the Director. The application bear the seal of the Company. The account extract is at Ex.P.1324. The entries therein reveal the following cash deposit or transfer of money to this account.

And on the same day, Rs. 20 lakhs has been withdrawn. From this account, a sum of Rs.10,75,000/-is seen to have been debited to the account of Riverway Agro Products (Pvt) Ltd., on 17.11.1994 and on the same day, Rs.28 lakhs are withdrawn by A-3. On 25.09.1994 a DD for Rs.37 lakhs is seen to have been taken and on the same day, Rs.7.5 lakhs are withdrawn by self cheque.

89.14) Thus, it could be seen that the activities relating to the acquisition of immovable properties and construction of structures commenced only during the tenure of A-3 and A-4 as the Directors of this Company. At the relevant point of time, A-3 and A-4 were in control and management of the affairs of the Company. The above evidence points out that, even though the Company was incorporated in 1990, the Bank A/c. was opened only after A-3 and A-4 took reign of the Company and all the transactions have taken place through Bank account opened by A-3. Except the use of the name of the Company, there is nothing on record to show that the funds of the erstwhile Company or its Directors are utilized for acquisition of these assets.

As per Ex.P.572 A-3 and A-4 resigned from the board of Lex Property Developments Pvt Ltd., on 04.03.1996.

The learned Sessions Judge has observed in respect of the Meadow Agro Farms Ltd., as under:

90. As per the evidence of PW.94 R. Lakshmi Narayana, P.A. to the Company Registrar, Meadow Agro Farms Pvt., Ltd., was registered in the office of the Company Registrar on 11.10.1990 with Registration No.19758/1990 (vide Ex.P594 - Certificate of Registration). The promoters of the company were Krishna Kumar Reddy and Anil Kumar Reddy. This witness has further deposed that a Form No. 32 was submitted by A-3 V.N. Sudhakaran on 26.5.1995 furnishing the particulars of appointment of the aforesaid Krishna Kumar Reddy and Anil Kumar Reddy as additional Directors. As per Ex. P- 599, A-3 and A-4 were appointed as Addl. Directors with effect from 3.8.1994 and they resigned from the Board on 6.3.1996 and 11.3.1996 respectively as per the (Form No.32, dt. 28.5.1996 vide Ex. P-601).

90.1) PW-97 Anil Kumar Reddy has stated that, he and Krishnakumar Reddy started an office by name Meadow Agro Farms (Pvt) Ltd., at No.5, I Street, Subba Rao Avenue, Numgambakkam in 1990. They took 250 shares each. They started the Company with the idea ofdoing real estate business in agricultural lands, but they did not have sufficient funds. In 1993, Subbarama Reddy, Ex-Parliamentary Member asked him whether they were interested to sell the Company. In 1994, he asked them to come over to his office and took their signatures in some printed forms and paid them Rs.2,500/- each by cheques. This witness further deposed that the files related to Meadow Agro Farms (Pvt) Ltd., were handed over to Sudhakaran Reddy. The cheque given to him was signed by Elavarasi and within a week therefrom, Meadow Agro Farms (Pvt) Ltd., office was changed to different address. This witness identified the signatures on Ex.P.595 and P.596 and further stated that after subscribing their signatures, they did not continue with the Meadow Agro Farms (Pvt) Ltd., 90.2) The aforesaid Krishna Kumar Reddy is examined as PW 106. He has also deposed in line with PW.97 and has specifically stated that, "After we soldthe company, I do not have any possession. For the company transaction, I received Rs. 2,500/- through a cheque". He further deposed that, "During this transaction, he signed the blank Forms and gave it to Sudhakar Reddy". He admitted his signature in Exs. P.660 and P.559. In the cross-examination by A-1, it is elicited that he sold the company to Subbirama Reddy.

90.3) Various sale deeds executed in the name of Meadow Agro Farms Pvt. Ltd., are also produced in evidence and the corresponding witnesses to prove these documents are examined.

90.8) This witness has also deposed about the preparation of the power of attorneys Ex.P.191 to P.196 and the sale deed executed on the strength of the said power of attorneys as per Ex.P.197 dated 15.03.1995 in favour of Maedows Agro Farms ltd., for Rs.54,050/-. Further this witness has deposed that on the strength of the power of attorney Ex.P.206 executed by its vendors, he executed the sale deed in favour of Maedow Agro Farms Ltd., on 29.04.1995 as per Ex.P.207 and on the strength of the power of attorneys Ex.P.208 to 213, he executed the sale deed in respect of 15.71 acres of land on 29.04.1995. It is the further evidence of PW.56 that on the strength of the power of attorneys Ex.P.215 to P.220, he executed a sale deed in favour of Maedow Agro Farms Ltd., on 09.06.1995 as per Ex.p.221. According to this witness,

all the above documents were registered in the office of the North Chennai Sub-Registrar before D.I.G. and the expenses for the documents were borne by Sudhakaran on behalf of the Maedow Agro Farms Ltd.,

Thus, according to PW.56, under the above sale deeds he sold 105.99½ acres of land and received a total sale price of Rs.10.60 lakhs.

In the cross-examination he denied the suggestion that A-3 Sudhakaran has not given him Rs.3.00 lakhs as advance. The evidence of this witness regarding the execution of the various sale deeds mentioned above on the strength of the power of attorneys executed in his favour are not at all challenged in the cross-examination.

90.9) PW.159 Thiru Rajagopalan is examined to speak regarding the registration of the sale deeds marked in evidence as Exs.P.68, 69, 70, 75 to 79, 96 to 110, 122 to 125, 135 to 139, 143 to 148, 153 to 156, 161, 165, 167, 174, 180, 184, 190, 197, 207, 214, 221, 291, 324, 330, 339, 345, 350, 357, 363, 366, 377, 388, 396, 408, 419, 431, 443, 450, 456, 467, 472, 477, 488, 513, 515, 771, 717, 772, 905, 906, 907, 908, 909, 910, 911, 912 and 913.

DW.86 has got marked Exs.D187 and D189. Ex.D.189 copy of the returns is seen to have been filed only on 19.04.2001. The copy of the Balance Sheet for the year ending 31.03.1996 is marked as Ex.D.188, the copy of the schedule to the annual returns as Ex.D.189 and it is stated that, the said schedule contains the list of who contributed the share capital amounting to Rs.1,06,55,000/-, but the names of none of the accused finds place in Ex.D.189. This witness has further deposed that the balance sheet filed by M/s. Meadow Agro Farms (Pvt) Ltd., would show that the Company had invested Rs.21,53,738/- on fixed assets viz., land and sum of Rs.21,09,000/- on shares in other companies. The said schedule also would indicate that the Company had lent Rs.32,90,000/- to A.2 Sasikala and Rs.62,50,000/- to M/s. Jaya Publications. The returns itself having been filed in the year 2000, this document could not have been filed in 3.4.1998, nor is there anything to show that R. Kumar and A.Jayaraman were the Directors of Meadow Agro Farms (Pvt) Ltd., at the relevant point of time. All these circumstances go to show that, these documents are got up to support of the false defence set up by the accused. Ex.D.189 also does not improve the case of the accused, nor does it inspire confidence to accept the contents of the said document in as much as this schedule to the annual return is seen to have been filed before the R.O.C. only on 19.04.2001 as could be seen from the seal of the Company.

90.19) Ex.D.190 is said to be the note order passed by the Income Tax Authorities on the return of income filed by M/s. Meadow Agro Farms (Pvt) Ltd., It is not known under what provision of law, such an order could be passed and what is the evidentiary value thereof. It is interesting to note that in the said note, the Directors are shown as (1) K. Krishnakumar Reddy and (2) K. Anil Kumar Reddy. As already stated above, PW.106 Sri.Krishnakumar Reddy has unequivocally has stated before the Court that, he and the other Director signed certain forms in 1994 and sold the Company and they are not in possession of the Company. Ex.P.601 produced by the prosecution unimpeachably establishes that both the said Directors have resigned on 03.08.1994. But, curiously they are shown as the Directors of the Company on the date of the order i.e., 30.03.2000, which itself is sufficient to discard the document as unreliable. Even otherwise, the contents of the said document do not advance the defence set up by A-3. In the said order it is noted that the Company had practically no business activities since its inception and had not filed any return of income and for the assessment year 1996-97 also, the assessee did not file any return of income and is is only after notices were issued, the return of income came to be filed on 29.03.2000 admitting NIL income.

90.20) What turns out from the above evidence is that, even though the Company was registered as back as in 1990, it had no business activities whatsoever, until the Company was taken over by A-3 and A-4. Secondly, the Company was not assessed to Income Tax. The documents produced by the accused are seen to have come into existence only after the year 2000. According to the accused, during the investigation, the premises of Meadow Agro Farms (Pvt) Ltd., were searched and all the documents and records pertaining to the Company were seized. If so, the Company could not have filed the returns without there being proper records to support the return. Even though much has been argued that the Company had its own resources, the accused has not been able to produce even the bank account statement standing in the name of the Company to justify the contention that the properties registered in the name of the Company were purchased out of the funds of the Company. On the other hand, the direct evidence produced by the prosecution clinchingly establishes that the entire funds for the purchase of the properties emanated from the accused and the said properties were never treated as the properties of the Company.

The learned Sessions Judge has observed in respect of theRiverway Agro Products Pvt. Ltd as under:

91. PW-96 Raghuram has deposed that in 1990, he and Prabhakar Reddy started a Partnership Company called Riverway Agro Products (Pvt) Ltd., but no business or transaction was being done. Subbarama Reddy suggested to sell the concern. In June, 1994, Prabhakar Reddy and he went to Subbaramu Reddy's office and signed some papers for transfer of the Company in the names of Sudhakaran and Elavarasi and they gave them Rs.2,000/- each in the form of two cheques. The cheque received by him was signed by Sudhakaran. Through this witness the prosecution has marked Ex.P.576 and P.577, the certified copies of Memorandum of Association and Articles of Association. Even in the cross-examination he reiterated that when he signed the forms, the name of V.N.Sudhakaran and Elavarasi were mentioned therein.

The evidence of PW.94 - R. Laxmi Narayanan, the Personal Assistant to Company Registrar reveals that Ex.P579 - Form No.32 was submitted appointing V.N.B.Sharma and V.Babu as additional directors. On 21.07.1994 another Form No.32 was submitted stating that V.N.Sudhakaran and Elavarasi were appointed as additional directors on 15.07.1994. This witness has further deposed that, Raghuram and Prabhakar Reddy resigned from the Directors post from 18.07.1994 and w.e.f. 10.08.1994.

The other details of the money deposited into this Current A/c. no.1095 are as under;

91.3) This witness has also spoken about the money transferred to this account from various other accounts as under;

According to PW.74, as per Ex.P.323 an undivided extent of 5.53 acres of land at Sirakulam was sold by Nachiar Ammal and Agastyer in favour of Riverway Agro Products Pvt. Ltd., for Rs.16,600/-. This witness has deposed that, as per the guidelines, the value of the Survey No.490/3A1 in 1994 was Rs.26,000/- per acre. Sale deeds were execution for 5½ acres of land in favour of Riverway Agro Products Pvt.Ltd., for RS.16,600/-.

But, as per the Orders on I.A. 321, PW.71 was recalled by the learned PP and was specifically asked as to which of the two versions given by him before the court are correct, for which PW 71 answered that the statement given by him in his examination-in-chief and the cross- examination in2001 are correct. In the cross-examination by the defence counsel, the witness denied that he had misused his official power and answered that the government has not taken any action against him for the alleged misuse of his official power and he did not complain against anyone that he should compel to speak before the court.

PW.76 is a Real Estate Agent has stated that likewise, on different dates, he got registered the power of attorneys in his name for Rs.1167.57 acres of land for a total amount of Rs.23,34,040/-. Rs.5,84,000/- was given to the local brokers.

In the cross-examination this witness has answered that he is not an income tax assessee and since he received the commission of only Rs.100/- per acre, he did not find it necessary to file income tax returns. He maintained in the cross-examination that apart from Rajagopal and A-3, a party from Kerala and other prospective buyers had also approached him regarding the land which was sold to Riverway Agro Products Private Ltd., PW.76 was also subjected to grueling cross- examination in installments commencing from 14.02.2001 to 21.02.2001. This witness was recalled on 28.01.2003 at the instance of the accused and during the further cross- examination on behalf of A-1, 2 and 4, this witness substantially prevaricated from his earlier statements and stated on oath that pursuant to the advertisement given by him in 'Dinathand' and 'Hindu' one Krishnan, an accountantfrom Riverway Agro Products Pvt. Ltd., approached him and his friends regarding the sale of lands and he and his friends doing the real estate business approached the land owners and got the power of attorneys and executed the sale deeds in favour of Riverway Agro Products Pvt. Ltd., During his evidence PW.76 deposed that, land owners gave commission for him and other brokers and he did not receive an other commission. He further deposed that, he did not have any contact with Thiru Rajagopal, District Registrar and he did not know PW.71 Radhakrishnan He also asserted that he did not know Sudhakaran, has only heard his name. He also resiled from his earlier statement that he had informed Rajagopal, District Registrar about the availability of the land and they had been to Tirunelveli. He denied that on 8th and 9th July 1994 Thiru Rajagopal introduced Sudhakaran to him at Thirunelveli. He also denied having visited Thirunelveli along with the said Rajagopal and maintained that all the transactions were carried out at the instance of Krishnan, accountant of M/s. Riverway Agro Products Pvt. Ltd., Further, he denied having made a statement "the brokers whobought and gave the land to me ending with that "Rajagopal, Jayalalitha, Sasikala and sudakaran are only purchasing those lands." Further, this witnessstated on oath that, on 07.09.1997 when he came to his residence, he was threatened by Nallamma Naidu and therefore, he had given false evidence before the Court. 76He further deposed that, during his first enquiry, the police officers related to this case compelled him to tell the names of the accused who were not connected with the case regarding the dealings.

91.16) Pursuant to the orders of the Hon'ble Supreme Court of India, the prosecution recalled this witness for further examination and in the course of the reexamination held on 19.01.2011, the learned Spl.P.P. specifically put a question to the witness as under;

Q: In your evidence in the first instance before the Chennai court you have given evidence regarding the negotiations resulting in execution of sale deeds and power of attorneys but later in 2003 after you were recalled you have given contradictory statements. Which of the two versions is true and correct?

A: The version given by me in the first instance is true and correct.

91.17) The witness was permitted to be cross-

examined by the defence and in the cross-examination, it was asked to the witness that, even in the cross- examination also he had stated the truth for which he replied that he had signed the cross-examination, but he did not know the contents thereof. He denied the suggestion that in his re-examination he has given false evidence at the instance of the police.

Notwithstanding the prevarication by the witness, the sequence of events narrated by him with regard tothe circumstances surrounding the execution and registration of the various sale deeds have remained unshaken. Even otherwise, the contemporaneous documents spoken to by this witness lend full credence to the testimony of this witness regarding his involvement in the procurement of the properties at the instance of A-3. More importantly, what turns out from the evidence of the above witnesses is that, the so called Riverway Agro Products Pvt. Ltd., was no way in the picture and the funds of the said Company were not utilized for the purchase and registration of these properties.

The learned Sessions Judge has observed in respect of the Ramaraj Agro Mills Ltd., as under:

PW.52 Gandhi has deposed that he and Ramaraj Agro Mills Ltd, had bought 6,10,000/- shares at the rate of Rs. 5/- per share. He could not get proper income from the said mill and decided to sell it. In 1994, Ramaswamy Udayar brought Sudhakaran to them and asked them to sell the mill. They negotiated and agreed to sell it at the rate of Rs. 3/- per share. Sudhakaran, Sundaravadanan, Ilavarasi and Prabha took over the Board of Management and in all 6,18,000 shares were bought by them.

PW.90 Tmt. Sheela Balakarishnan, Secretary in Employee and Admn. Reforms Dept., has deposed that Ramaraj Agro Mills Ltd., took assistance from SPICOT. The Chairman of Ramaraj Agro Mills Ltd., Mr. Gandhi wrote a letter to the Managing Director of SPICOT Company as per Ex.P-541 informing that V.N. Sudhakaran and J. Elavarasi were appointed as Joint Directors of the said Firm. The existing members Gandhi, Asokan, Satthivelu and Magilavannam also wrote a letter as per Ex. P-542 informing that they had resigned from their post. Through this witness, the prosecution has marked Exs. P-544 to P-

547. Mr. Lakshmi Narayanan, P.A., to the Company Registrar is examined as PW 94 regarding the registration of Ramraj Agro Mills Ltd., This witness has deposed that Ramaraj Agro Mills Ltd., is registered in their office on 28.5.1996 with registration No. 13060/1986 as per Ex. P-

606. The company was started by Thillanayagam, Ramaswamy Udayar and five other persons. The copy of Memorandum of Association is at Ex. P-606 and the copy of Articles of Association is at Ex. P-608. The Form No. 29 relating to the Company are marked as Exs. P-609, 610 and 611 and Form No. 18 is marked as Ex. P-612 and it is stated that as per Form No. 32, V.N. Sudhakaran, Sundaravadanam, Ilavarasi and S. Prabha were appointed as Additional Directors with effect from 23.11.1994.

Ex. P-615 is the certified copy of the Form No. 32, dt. 8.5.1996 submitted by Sundaravadanam in his capacity as the Director intimating that A-3 resigned as Director on 8.5.1996 and A-4 Elavarasi and Prabha resigned with effect from 22.2.1996 and with effect from the said date, three other persons were appointed as Additional Directors.

Ex. P-542 is the letter, dt. 24.11.1995 written by T.V. Sundaravadanam to the Managing Director, SIPCOT Ltd., Madras regarding the change of management and re- schedulement of the loan and waiving of interest. In the said letter, it is stated that the change of management has taken place with effect from 19.1.1995 and only the following four Directors, who have been earlier inducted as Additional Directors on 23.11.1994 have been functioning as Board of Directors viz., 1. Tr. T.V. Sundaravadanam (with 12 lakh shares), 2. Tr. V.N. Sudhagaran (with 12 lakh shares), 3. Tmt. J. Elavarasi (with 1000 shares) and

4. Tmt. S. Prabha (with 1000 shares). The other shares are held by the associates of the company.

Ex.P-144 is the certified copy of the sale deed (document No. 26), dt. 7.1.1995 executed by A.S. Arunachalm, who is the power of attorney of Mr. Gandhi in favour of Ramaraj Agro Mills Ltd., shop No. 21, Wellington Plaza, Anna Salai, Madras in respect of 4.44 acres of land comprising Sy. No. 83/1 and Sy. No. 80 situate in Vandampalai village for Rs. 88,800/-. The consideration is shown to have been paid by means of DD bearing No. 626330, dt. 7.1.1995 issued by the Indian Bank.

Ex.P-146 is the certified copy of the sale deed (document No. 28), dt. 7.1.1995 executed by Tmt. S. Valli, through her power of attorney Mr. Gandhi in favour of Ramaraj Agro Mills Ltd., shop No. 21, Wellington Plaza, Anna Salai, Madras for Rs. 1,78,200/-paid by means of a DD bearing No. 626333, dt. 7.1.1995 drawn on Indian Bank in respect of 8.91 acres comprised in Sy. Nos. 77/1A, 77/1C, 77/1B/82/1A situate in Vandampalai village.

Ex.P-147 is the certified copy of the sale deed (document No. 74) of January, 1995 executed by Tmt. Rajamani Ammal, represented by her power of attorney Mr. Asokan in favour of Ramaraj Agro Mills Ltd., shop No. 21, Wellington Plaza, Anna Salai, Madras in respect of 4.57 acres comprised in Sy. Nos. 75, 76/5, 76/2A and 77/1D situate in Vandampalai village for a consideration of Rs.1,62,000/- by means of Bankers Payment Order bearing No 121333, dt. 7.1.1995 issued by the Indian Bank, Madras-18.

Item No.146- Cost of construction of labour quarters (five) in ground floor and five in 1st floor, 10 numbers in ground floor and 10 numbers in 1st floor, construction of 1st floor for guest house, over the existing ground floor and construction of platform in Ramaraj Agro Mills campus at Vandampalai during 1994-95 (Evaluation report)

- Rs. 57,19,800.00 Item No. 147, Cost of constructions of compound wall, twin houses, staff quarters for eight numbers and M.D. bungalow in Ramaraj Agro Mills campus at Vandampalai in 1994-95 (Evaluation Report)

- Rs. 83,41,000.00 Referring to Ex. D-208, the learned counsel for A-1 further submitted that the company had borrowed a loan of Rs. 1 Cr. from Magunta Investments Pvt. Ltd., towards ICD and the conformation in this regard was produced before the Income-tax authorities as per Ex. D-208 and DW.87 has spoken about all these transactions, which clearly indicate that the company was possessed sufficient needs and resources to acquire the properties and to effect construction therein. Moreover, the prosecution has not produced any material before the court either to show that A-1 had advanced any funds for the acquisition of the said assets, nor is there any evidence on record to indicate that A-2 to A-4 had advanced any funds towards the acquisition of the said properties. Therefore, the entire amount shown in item Nos. 146 and 147 are liable to be deducted.

Before appreciating the contention urged by the learned counsel for A-1, it may be relevant to refer the evidence of PW 153 the Superintending Engineer in Tamil Nadu Public Works Department, who has deposed regarding the inspection of the labour quarters and the compound wall under construction in Ramaraj Agro Mills Campus at Vandampalai. According to this witness, he has worked in Public Works Department for about 35 years and for many years he has worked in Construction Division only. An order was issued to the PWD Chief Engineer on 20.11.1996 to assess the buildings in the premises of Ramaraj Agro Mills Ltd., at Vandam Palayam in A.T. Panner Selvam district. Kaliyappan, Asst. Executive Engineer, Karunakaran, an Asst. Engineer, Manian, a Jr. Engineer and Rajaraman, an Electrical Engineer were appointed to assist him in the assessment from 27.11.1996 to 29.11.1996. They inspected all the buildings and took the measurement and then prepared the assessment report on the basis of the respective order of construction and on the schedule rate of PWD, prepared the assessment report as per Ex. P-822 and he arrived at the total value of the civil work at Rs. 139.56 lakh, electrical works at Rs. 10.734 lakh and total of Rs. 150.294 lakh. He has specifically deposed regarding the value fixed by him for the buildings constructed during the years 1991-92 and during 1994-95.

In the cross-examination, it is elicited that there was no written order to inspect the buildings. From 27.11.1996 to 29.11.1996 when they inspected the buildings, two workers from the mill assisted them in digging and other allied works. It is elicited that the court order was not issued and he did not serve any written notice on the company. It is further elicited that the Electrical Engineer, who assessed the electrical works belong to the Public Works Department. In those buildings, workers quarters (30 residences in two buildings), a go-down, a guest house in the 1st floor and the compound wall were completely done. In the bungalow for the Managing Director, two twin houses and a house of quarters were built. Electrical fittings were not fixed and the final coat of painting was also not done. In the cross-examination, it is elicited that the reports were written in two different ink pens. The Asst. Engineer, Karunakaran wrote the report. In the report, it was written as 'for the subsequent year' and it was struck and corrected as 'respective' in different ink. It is also elicited that the Asst. Engineer Karunakaran prepared the plan and notes under his supervision. He valued the buildings on the basis of the PWD rates. The rate list is not enclosed to Ex. P-822 and it does not have the details. As the water supply and sewerage were concealed, he consider those rates as per PWD norms. The rate of electrical fittings were also fixed at the rate of PWD. From local enquiry and his experience, he determined the age of the buildings.

Though this witness was fully cross-examined, he was recalled and subjected for further cross-examination on 24.12.2012 and he made contradictory statements regarding the age of the buildings as well as the rates applied by him for assessment of the value of the buildings. But, when he was recalled at the instance of the Public Prosecutor and was subjected to re-examination by putting a question, he has given two different versions regarding the year of construction of the buildings and which amongst the two versions is the correct one, PW 153 categorically answered that the earlier version i.e., he has stated in his examination-in-chief is correct. During the cross-examination by the counsel for A-1, he answered that during his first examination in the year 2000, his deposition has been made over and accordingly, accepted it as correct and signed it. But, in so far as his deposition in the year 2002 is concerned, he was not permitted to go through the deposition and was asked to sign the same in the presence of the counsel for the accused.

The learned counsel for A-1 has seriously disputed the liability and admissibility of the report submitted by PW.153 contending that the valuation report submitted by him is interpolated and he has not furnished the verifiable data either to determining the age of the buildings or the rate for the construction. In support of his arguments, the learned counsel referred the evidence of DW 81 M. Karunakaran, Asst. Executive Engineer, PWD, who was part of the team in the preparation of the valuation report Ex. P-822. This witness deposed on oath that, at the time when he signed the report Ex. P.822, in the last para, it was mentioned as 'The rates for the materials and labour are arrived at adopting the schedule rates for the subsequent years for execution and the individual values are worked for each year and the total amount works out to Rs. 139.56 lakh. But, it is now seen that, in the above last para in the 3rd line, the words 'for the subsequent' have been struck off and there is inter-lineations of the portions 'at the respect.' Further, this witness deposed that the report was signed individually and at the time of inspection, no representative of M/s. Ramaraj Agro Mills Ltd. was present.

In appreciating the testimony of this witness, it is relevant to note that this witness has not disputed the fact that he was also one of the members of the team along with PW 153 in the assessment and valuation of the workers quarters and the compound wall. He has not denied the fact that during the inspection, the measurements of the buildings were taken and the rates were determined on the basis of the PWD rates. As a matter of fact, Ex. P-822 not only contains the report duly signed by PW 153, DW 81 and other Engineers including the Electrical Engineer, who were part of the assessment team, but also contains the detailed estimate with reference to the measurements of individual items of works running to nearly 219 pages and along with the plan of the buildings and the compound wall duly signed by all the above persons including DW 81, which has remained un-impeached.

No doubt, it is true that in the report there are interlineations as stated by DW 81, but I do not find that the said interlineations has the effect of nullifying the entire contents of Ex. P-822 or the oral testimony of PW

153. Though the learned counsel has made much of the fact that "rates for the subsequent years" is scored off and in its place "at the respective year" is inserted, nothing turns out from the said corrections as is published. It is not the case of either party that PWD publishes the rates for the subsequent years. In the cross-examination of PW 153 itself, it is elicited that every year the rates could be published in writing by the Superintending Engineer. It is not the case of the accused that the rates for the subsequent years are being published in the previous years. Under the said circumstances, there is no question of applying the rates for the subsequent years for determining the assessment done in the relevant year. Therefore, the objections raised by the learned counsel for A-1 do not merit acceptance.

The accused have not disputed the fact that the workers quarters as described in the report and the compound wall was being constructed at the relevantyear. On consideration of the evidence of DW 81, I find that this witness is totally a false witness and has no regard for truth whatsoever. From the circumstances brought out in the cross-examination of this witness clearly suggests that he is propped by the accused to support the false defence set up in a bid to offer explanation to the huge assets amassed in the name of the company. In appreciating the evidence of DW 81, it is important to note that being a public servant, who was deputed to assist PW 153 and participated during the evaluation of the structures and the compound wall and he himself scribed the report in his own hand writing, has even gone to the extent of denying the suggestion in the cross-examination, which reads that

It is not true to suggest that I put signatures in Ex. P-822 after going through the contents of upon being satisfied about the correctness of the said report.

92.26) When he has admitted in his evidence that Ex. P.822 is in his own handwriting, it cannot be believed that he has signed the report without knowing the contents thereof. This statement not only dents the credibility of his evidence given before the court, but raises serious questions of his continuation in government service. His evidence suggests that either he has been careless or negligent in performance of his duties or that he has deliberately given false evidence unmindful of the consequences that would emanate from his evidence. Nevertheless, it stands established that, by the statements made before the court, he has rendered himself liable for Departmental Enquiry for the misconduct referred above.

92.27) In so far as the documents produced by the accused is concerned, it is necessary to note that Ramaraj Agro Mills Ltd., is a public limited company. As per the provisions of the Companies Act, it is required to maintain proper accounts complying with the accounting standards. At every annual meeting, the Board of Directors are required to lay the balance sheet, profit and loss accounts statement and report of the Directors etc., which would have been the best evidence regarding the share capital, reserves and liabilities of the company. But, strangely in proof of the asset s and liabilities of the company, the accused have relied on the oral testimony of DW 87 the Chartered Accountant, who is stated to have been involved in the auditing of the accounts of M/s Ramaraj Agro Mills Ltd., But, bare perusal of the documents marked through this witness at Exs. D-204 to D-208, on the face of it, it reveal that the said documents got up by the accused only to bolster of false defence set up by the accused. Ex.D.204 is certified to be the true copy of the Form No. 3 CA viz., the audit report filed on behalf of M/s Ramaraj Agro Mills Ltd., It is dt. 22.11.1994. The audit report is marked as Ex. D-206 and it is dt. 1.9.1995. This document is certified as true copy by R. Vaidyanathan, partner of S. Venkataram & Co., On the face of it, this document is not admissible under law neither it is a certified copy, nor is the author of this document examined to prove the said document, as such no reliance could be placed on this document. Even otherwise, this document which is dt. 1.9.1995 could not have been the part of Ex. D-204. There is nothing to indicate that either Ex. D-204 or Ex. D-206 were produced before the income-tax authorities and any order has been passed thereon. The profit and loss account statement for the year ending 31.3.1995 and the balance sheet for the said period are enclosed to the said auditor report, which are also certified by the partner of S. Venkataram & Co., Neither the Directors, nor the partners, who have signed the documents are examined before the court. It is also not known who has signed this balance sheet and the profit and loss account statement. The certified copy of the annual returns filed by Ramaraj Agro Mills Ltd., is marked as Ex. D-205. The endorsement therein indicates that the said returns were filed only on 30.9.2000. It is seen to have been signed by one A. Kuppusamy as the Director of the company. Though the annexures to the said returns are not produced, this document clearly indicates that the returns in respect of the company were filed in the year 2000. Under the said circumstances, Ex. D-204, D-206 and D-207, which are certified as the true copies by Venkataram & Co., lead to inevitable conclusion that these documents were got up by the accused and these documents were neither the part of the returns, nor were produced by the Income-tax authorities at any time.

92.28) Though the accused have contended that Rs. 1 Cr. was availed as loan from Magunta Investments Pvt., Ltd., company, the accused has neither produced any reliable evidence in proof of the availment of the loan, nor they have examined the author of Ex. D-208 or the recipient thereto. Ex. D-208 is said to be the conformation letter issued by Magunta Investments Pvt., Ltd., in proof of the loan availed by the company. It is dt. 8.2.1996, which reads as under;

"Paid to M/s Ramaraj Agro Mills Pvt. Ltd., DD (vide Global Trust Bank Ltd. Ch. No. 017715, dt. 8.2.1996) for Rs. 1,00,00,000/- (Rs. One Crore only) towards I.C.D., Sd./-

For MAGUNTA INVESTMENTS PVT. LTD., Director/Authorized signatory."

92.29) There is absolutely no supporting document by way of bank payment book or proof of either issuance of DD or the cheque or encashment by M/s Ramaraj Agro Mills Ltd., in proof of the said loan. The accused have sought to sustain the defence solely on the basis of Auditor's report and the so-called profit and loss account statement and the balance sheet, which undoubtedly has been got up without any basis or supporting bank documents required under the Companies Act.

92.30) The testimony of PW 182 the Chief Manager, Indian Bank, Abhiramapuram Branch reveals that, by submitting an application, dt. 22.12.1994 as per Ex. P.1341, A-3 opened C.A. No. 1143 in the name of Ramaraj Agro Mills Ltd., company. This application does not contain the seal of the company, nor is it accompanied by any resolution of the company to open the account. Be that it may, the statement of account relating to this C.A. No. 1143 discloses that the said account was opened on 23.12.1994 with a deposit of Rs. 1500/-. There is a credit entry for Rs. 8,60,000/- by transfer on 7.1.1995. There is no other credit entry. A self-cheque for Rs. 1,55,000/- is seen to have been passed on 7.1.1995 and that cheque is signed by A-3 as authorized signatory of Ramaraj Agro Mills Ltd., as per Ex. P-1345. On 7.1.1995 a cheque for Rs. 6,98,000/-was passed in favour of the BBO. PW 182 has explained that Ex. P-1347 is the application, dt. 71.1995 submitted by one Ram Vijayan for issuance of Bank Pay Orders for Rs. 6,98,000/-. It is marked as Ex. P-1347 and he has further stated that the Pay Orders were asked in the name of the persons as per the list. Though the individual Pay Orders or DDs corresponding to the sale consideration paid under document Nos. 25 to 29 is not spoken to by PW 182, yet in the sale deeds referred to above viz., Exs. P-143 to P-147, the sale consideration is shown to have been paid by means of DDs bearing Nos. 626328, 6263330, 626329, 626333 and BPO 121333, dt. 7.1.1995 issued by the Indian Bank, which co-relates to the amounts drawn through this account.

92.31) Through the above witness, the prosecution has marked the statement of account relating to OD 78 standing in the name of Ramaraj Agro Mills Ltd., as per Ex. P-1348. This account was opened on 4.2.1995. On the same day, a cheque for Rs. 25,02,250/- has been passed under MT Thiruvarur. On 9.2.1995 a cheque for Rs. 25 lakh was passed in favour of BBO. On 21.2.1995 an amount of Rs. 50 lakh was transferred from C.A. No. 1113 to this account. On the same day, there was a debit entry for Rs. 50,05,500/- by MT Thiruvarur. On 23.2.1995 an amount of Rs. 50 lakh has been credited to this account by transfer from OCC-19. On 25.2.1995 there is a debit entry for Rs. 50,03,500/- by MT Thiruvarur. On 26.3.1995 to debit the balance from this account was transferred to OCC - 19 account and then the account was closed. There was a debit balance of Rs. 55,38,023.65 at the time of transfer on that day.

92.32) Ex.P-1349 is the application signed and submitted by V.N. Sudhakaran to open a OCC-19 account in the name of Ramaraj Agro Mills Ltd., Ex. P-1350 is the photo copy of Form No. 32. One Gandhi has signed in it on 19.2.1994. Ex. P-1351 is the letter signed and submitted by V.N. Sudhakaran asking for a loan of Rs. 200 lakh for the company. Ex. P-1352 is the sanction ticket received from their head office sanctioning a loan (OCC) of Rs. 165 lakh and it is dt. 24.3.1995. Ex.P.1353 is the copy of the telex message sent from the central office asking to transfer the sanctioned loan of Rs. 165 lakh to the same company's account in the Thiruvarur Branch of Indian Bank. Ex. P-1354 is the statement of account of OCC-19. On 23.2.1995 an amount of Rs. 50 lakh has been transferred from this account to OD-78. On 11.3.1995 an amount of Rs. 50,03,500/- has been debited by cheque by MT. Thiruvarur. On 26.3.1995 an amount of Rs. 55,38,023.65 has been transferred from OD-78 account to this account and debited. Money has been credited into this account many times by MT Thiruvarur. As on 30.4.1996 in this account, the amount due to the bank was Rs. 39,10,781/-. An amount of Rs. 17,93,002/- was debited from this account towards interest till 30.4.1996.

The learned Sessions Judge has observed in respect of the Signora Business Enterprises Pvt. Ltd. as under:

93. As per the evidence of PW.94 R. Lakshmi Narayanan, Personal Assistant to Company Registrar, Signora Business Enterprises Pvt., Ltd., was registered in the office of the Company Registrar on 22.10.1990 with registration No. 19806 of 1990. The Certificate of Registration is at Ex. P-586. Ex. P-587 is the Memorandum of Association and Ex. P-588 is the Article of Association. The company was started by Sri Bhaskar Reddy from Nellore and Narayana Rao of Chennai. They were the 1st Directors. The company's official address was L-17/4, 26th Cross, Besant Nagar, Chennai. On 13.3.1992, Form No. 18 was submitted regarding the change of office address as per Ex. P-589. On 7.9.1994, Form No. 32 was submitted intimating resignation of P. Krishna Rao and B. Narayana Reddy with effect from 29.8.1994 and the appointment of A-3 V.N. Sudhakaran and A-4 J. Elavarasi as the Addl. Directors with effect from 17.8.1994 as per E. P-598. On 24.11.1994 Form No. 18 was submitted for having changed the office of the company to No. 21, 1st Floor, Wellington Plaza as per Ex. P-591. Thereafter, another Form No. 32 was filed on 28.5.1996 stating that Manohar and Hari Krishna from Bombay were appointed as Addl. Directors on 17.2.1996 and on 5.2.1996 respectively as per Ex. P-592. On 30.5.1996 Form No. 32 was submitted as per Ex. P-593 intimating the resignation of A-3 on 5.3.1996 and resignation of A-4 on 12.3.1996. Thereafter, PW 94 did not receive any information about the change of address of the said company.

In the cross-examination, it is elicited that the company had filed the Returns for the year1991-92 and 1992-93. The copies of the Returns and the Balance sheet with Auditor's report filed on 5.5.1993 by Narayana Rao and V.S. Bhaskar Reddy reveal that the authorized capital of the company was Rs. 10 lakh and the paid up capital was only 900 equity shares of Rs. 10/- each amounting Rs. 9,000/-. In the Auditor's report, dt. 9.9.1993, it is specifically stated that the company has no fixed assets and there were no stocks and the company had not given or taken any loan from the firms or companies or its Managers. Thus, from the documents marked through this witness coupled with his oral evidence, it stands established that, after the resignation of the earlier Directors, A-3 and A-4 became the Directors of the aforesaid company on 17.8.1994 and resigned on 5.3.1996 and 12.3.1996 respectively. There is nothing on record to show that the company had filed any Annual Returns or the Balance sheet subsequent to A-3 and A-4 became the Directors thereof. There is also nothing on record to show that either A-3 or A-4 had subscribed the shares of the company or had contributed to the capital of the company.

93.2) Regarding various properties purchased by this Firm after A-3 and A-4 became its Directors, PW.9 Sadagopan, the Sub-Registrar, Cheyyur has deposed that, during the year 1993 when he was working as Sub- Registrar at Seyyoor, he registered the sale deed executed by M/s K. Appaswamy Mudaliar and others in favour of Signora Business Enterprises Pvt., Ltd., for Rs. 27,720/- on 8.12.1993 as per Ex. P-34. On 1.2.1994 another sale deed was registered as per Ex. P-35 in favour of the said Firm for Rs. 84,400/- in respect of 1.14 acres of land. The market value of the said property was Rs. 1,45,800/-. Ex. P-33 is another sale deed registered in favour of Signora Business Enterprises Pvt., Ltd., for Rs. 16,800/-. The market value of this property was Rs. 28,760/-. On 26.5.1993 another sale deed Ex. P-36 was registered in favour of the company for Rs. 1,20,000/- and on 25.6.1993 Ex. P-37 the sale deed was registered in favour of the aforesaid Firm for Rs. 82,500/- (market value was Rs. 1,41,000/-) and likewise, another sale deed Ex. P-38 was executed on 20.4.1993 and he registered it for Rs. 41,250/- (market value was Rs. 71,050/-) and on 25.6.1993 he registered Ex. P-39 executed in favour of the aforesaid Firm for Rs. 55,500/- (market value was Rs. 82,140/-). In the cross-examination, it is elicited that, at the time of the registration, he ascertained that the sale price has been paid to the vendors and registered all the documents only after the sellers confirmed that they have received the cash.

The learned Sessions Judge has observed in respect of the Indo Doha Chemicals and Pharmaceuticals Ltd.,as under:

94.1) PW.84 further deposed that the share holders had authorised PW.84 to sell the shares and get their money. Accordingly, PW.84 and A-3 entered into a memorandum of understanding as per Ex.P.510. Through this witness, the prosecution got marked the bank account Register Ex.P.511. PW.84 further deposed that, after selling his shares he continued as Chairman of the said Company and further deposed that during 1994, Company was leased to SPIC and he signed the lease documents as per Ex.P.512.

94.2) PW.84 further deposed that, in 1994 Natarajan, DW.2 asked him about the files, ledgers and documents relating to Indo-Doha Chemical Company. He told him that, all those documents have been given to the auditor Sri.Rajasekharan. This witness was recalled on 07.09.2000 and during the examination by the counsel for A-3, he substantially resiled from his earlier testimony stating that he has not given any resignation letter during 1994. He further stated that, in the Board of Directors meeting did not pass any resolution to sell the shares at Rs.6/- per share. It was resolved as to whom the shares were to be transferred and he does not know whether the shares have been transferred to the name of V.N.Sudhakaran or not. It is further elicited that till the year 1993 the companysubmitted the yearly returns and he has not informed to the Registrar of Companies about the transfer of shares.

PW.85 - Sreedhar was the Vice-President of Ind Bank from 1989 to 1997. He has deposed that Bank purchased 2,50,000 shares of Indo-Doha Chemicals and Pharmaceutical at Rs.10/- per share. The shares so purchased in 1992 were sold in the year 1994 to Sudhakaran for Rs.27,41,000/- and the amount was paid through Canara Bank cheque.

PW.90 Tmt. Sheela Balakrishnan, Secretary Administration Reforms Department, has deposed that the Chairman of the Ramraj Agro Mills Ltd., Gandhi, wrote a letter to the Managing Directors of SIPCOT Company stating that, V.N.Sudhakaran, T.V. Sundaravadanam, J. Elavarasi and Tmt. Prabha wereappointed as additional directors. The existing members Gandhi, Asokan, Satyavel, Mahilavannan wrote a letter stating that they withdrew from their post. The said letter is Ex.P.542. SIPCOT agreed for the change of administration. Ex.P.544 is the resolution of the Board of Meeting. PW.92 - Ketan Gandhi, Excecutive Director of Interface Capital Market Private Limited corroborated the testimony of PW.85 regarding the purchase of shares stating that, Interface Capital Market Pvt. Ltd., purchased 2,20,000 shares of Indo-Doha Chemicals and Pharmaceauticals Ltd., at Rs.10/- per share. According to this witness after they invested in the company, the company did not make any profits. Hence they tried to sell the shares and in 1994 Ind Bank approached PW.92 and holding that, they would make arrangement to sell the share Ex.P.559, letter written by the Bank to PW.92 and Ex.P.560 is the copy of the letter written by PW.92 to V.N.Sudhakaran regarding the matter. PW.92 further deposed that, a sum of Rs.24,05,000/- was paid to them through D.Ds.

94.7) PW.93 James Fredric is the Managing Director of Intake Products Ltd., He has deposed that, he own a pesticide factory in Sipcot Industrial Estate, Cuddlore. He knows V.N.Sudhakaran who purchased Indo-Doha Chemicals Company which was beside his factory in the Sipcot Industrial Estate. Sudhakaran wanted to develop his factory and for that he needed the land of PW.93. He wished to buy the factory shares and to take over the administration. As the factory was running at loss and having a debt of 7 to 8 crores, PW.93 agreed to hand over the administration to Intake Products Ltd., to V.N.Sudhakaran and agreed to transfer 8,56,636 shares of the company to V.N.Sudhakaran, who paid Rs.50.00 lakhs by way of three cheques. Through this witness, prosecution got marked the extract of the Bank account of PW.93 as Ex.P.563, copy of the pay-in-slip Ex.P.564, P.565. This witness further deposed that, with this money he took a D.D. of Rs.50.00 lakhs in the name of Coromandel and settle the debts. Ex.P.566 is the application for the D.D. This witness further deposed that presently Intake company is under the control of official liquidator.

During his cross-examination, except eliciting that he did not tell the police during his enquiry about the extra money given to him, the other part of his testimony was not challenged. But, this witness was recalled at the instance of the accused and surprisingly in his further cross-examination by the accused, this witness stated that, during his chief-examination he did not say anything about Ex.P.563 to P.566 and further stated that Intake Products Ltd., shares were not transferred to the name of third accused and maintained that the shares of the company are still with PW.93 and the amount of Rs.20.00 lakhs being the purchase money is also with him. He denied having made any statement before the I.O. But, pursuant to the orders of the Hon'ble Supreme Court of India, even this witness was recalled by the learned Spl. Public Prosecutor and was subjected to re-examination and was questioned as to whether the statement made by him during his chief-examination to the effect that they were ready to transfer 8,56,636 shares of the company for which V.N.Sudhakaran gave them three cheques viz., cheque for Rs.20.00 lakhs, Canara Bank, Mylapore, cheque for Rs.20.00 lakhs Indian Bank, Mandhaveli, and cheque for Rs.10.00 lakhs and the transfer of shares and regarding the transfer of his shares, he received only Rs.20.00 lakhs from the third accused and Rs.20.00 lakhs is with him is correct. PW.93 answered that, due to the age factor, his memory power has gone weak and therefore he is not in a position to say which of the statement is correct.

94.8) From the above evidence, it could be deduced that,

(i) At the relevant time of acquisition of the above properties, all the above six companies were exclusively in the control and management of A-2 to A-4. As already highlighted above, the promoters had already resigned in favour of A-2 to A-4. Except Indo Doha Pharmaceuticals Company Pvt. Ltd., all other promoters and erstwhile Directors have unequivocally stated before the Court that, on receipt of the amount invested by them for the formation of the Companies, they signed the necessary forms and went out of the Company and since then, they ceasedof any right or interest in the said property.

(ii) The promoter Directors have categorically stated before the Court that they did not purchase any properties in their names either before or after the formation of the Company as long as they were on the Board of Directors.

(iii) It has come in evidence that A-2 to A-4 took over the management of the Company without even buying the requisite shares. Though it is argued by the counsel for A-1 that in terms of the Memorandum of Association and Articles of the Company, qualifications of the shares is not necessary, yet, the fact remains that A-2 to A-4 continued the name of the Company without there being any other shareholders and without purchasing any shares by themselves. This is one of the strong circumstances to show that, though the Companies are incorporated under the Companies Act, they do not have any trappings of a company.

(iv) It is proved in evidence that, none of the above Companies had any account in their names. It is only the erstwhile Shareholders of M/s. Ramaraj Agro Mills Ltd., had stated before the Court that the Company had a bank account, but when a specific question was put to this witness as to whether the payment for the purchase of the properties was made from the said bank account, the witness gave an evasive answer making it evident that for the purchase of the properties involved in the case, the funds of the Companies were never utilized.

(v) There is clinching evidence to show that the bank accounts were opened by A-2 and A-3 in the name of the Companies only after they took over the management and control of the companies and all the transactions relating to the said companies are stated to have taken place through these accounts. But it is necessary to note that the funds were transferred or remitted to these accounts either from the bank account held in the name of Namadhu MGR, Jaya Publications or other firms run by A-1 & A-2, which clinches the issue that, the funds for the acquisition of the properties had flown from A-1 either directly or through the accounts maintained in the joint names of of A-1 and A-2.

94.9) It is also important to note that the properties involved in the trial had never assumed the character of the assets of the Company and did not vest with the Company as contended by the learned Counsel for the accused. It is proved in evidence that, no funds of the above named companies were utilized for the acquisition of the properties. It is an admitted fact that, none of the companies had filed returns either before the Registrar of Companies or before the Income Tax Authorities declaring the funds for the purchase of the properties or the acquisitions alleged to have been made in the name of the Companies.

In the instant case, Sections 209, 210, 211 and 215 of the Companies Act, 1956, have not been complied. Returns have not been filed by the respective companies from the date of its incorporation till the date of attachment of the properties.

94.16) Sec.220 of the Companies Act, lays down that,

After the balance sheet and profit and loss accounthave been laid before a company at an annual general meeting as aforesaid, there shall be filed with the Registrar within 30 days from the date on which the balance sheet and the profit and loss account were so laid or where the annual general meeting of a company for any year has not been held, there shall be filed with the Registrar within 30 days from the latest day on or before which that meeting should have been held in accordance with the provisions of this Act.

It is not thecase of A-2 to A-4 that during their tenure as the sole Directors of the above Companies, they had complied with any of these legal requirements so as to claim that the transactions entered into by them were for and on behalf of the Companies.

94.17) That apart, there is nothing on record to show that, A-2 to A-4 had convened any annual general meeting of the Company at the relevant time when they were at the helm of the Company nor is there any material to show that regular returns were filed before the Registrar as required under law. That apart, the above companies did not have their own auditor appointed as per Sec.224 of the Act, instead, it has come in evidence that the auditors of A-1 to A-4 themselves submitted the returns after the properties of the companies were attached. All these circumstancesclearly go to show that the except using the name of the company, the acquisitions were never intended to be the assets of the above companies nor were they treated as the properties of the companies at any point of time. It is only after the attachment of the properties, the accused have come up with the contention that the properties having been registered in the name of the companies, the ownership thereof vests with the Company and therefore the properties in question could not be said to be the benami properties of A-1. But, as already discussed above, the funds for the purchase of these properties are proved to have been flown from the sources provided by A-1 and all throughout, the properties were treated as private properties of A-3 & A-4. It has come in evidence that, A-3 and A-4 obtained loan for effecting improvements in these properties and there is nothing on record to show that the loan liability has been taken over by the above Companies. The certified copy of the orders in Misc. Ptn. 768/2014 dt. 18.06.2014 and Misc. Ptn. 289/2014 dtd. 26.06.2014 passed u/Sec. 5 (3) of the Criminal Law Amendment Ordinance, by this Court in exercise of the powers under the said Ordinance, reveals that after the resignation of A- 3 and A-4, there was no proper appointment of the Directors and a finding has been recorded that, apparently for the said reason, the order of attachment passed in 1997 was not questioned before the District Judge for nearly two years. A finding has been returned in the above orders that the consideration for purchase of the properties did not represent the funds of the respective companies. In the light of these findings, the contentions raised by the accused that the properties in question absolutely belong to the above Companies and therefore could not have been tagged to the assets of A-l on the basis of benami cannot be accepted.

94.18) The argument of the learned counsel that the Companies incorporated under the Companies Act cannot hold the properties benami to another person is mis- conceived and cannot be accepted. No doubt, it is a basic or cardinal principle of law that, on incorporation, a Company acquires legal status with perpetual succession and a common seal. Since the Company has no physical existence, it must act through its agents and all such contracts entered into by its agents must be under the seal of the Company. The common seal of the company is of great importance. It acts as the official signature of the Company. A document not bearing the common seal of the Company is not authentic and has no legal force behind it. But unfortunately, in the instant case, hardly any document of title registered in the name of the above Companies bear the seal of the Company. This is another circumstance to show that the properties purchased in the name of the above Companies never assumed the character of the assets of the Companies. Worse still, the above Companies are not even represented by either the Secretary or Director and in 90% of the registered deeds discussed above there is not even the address of the Companies written in the body of the deed. This is another circumstance to show that, shoddy and murky deals had taken place in the names of the Companies solely with a view to screen the properties acquired through illegal means.

94.19) The above view gets further fortified from the fact that, the Registrar who registered these properties and PW.181 who negotiated for the purchase of the properties bent the rules only to help the A-1. The circumstances brought out in their evidence clearly indicate that, they went out of the way to register these properties as instructed by A-1 solely to oblige A-1. I have already referred to some of the documents wherein, even the names of the purchasers were not included at the time of purchase and almost all the documents were under valued. The Dist. Registrar has unequivocally stated that, he proceeded with the registration solely because the properties were purchased by A-1. Under the said circumstance, it does not lie in the mouth of the accused now to contend that since the properties were registered in the name of the Companies they are deemed to be the properties of the Companies.

94.20) The legal position is well settled ever since the decision in the case of Solomon vs. Solomon that, Company is a legal entity and is distinct from its members. It bears its own name and a seal of its own. Its assets are distinct from those of its members. This principle of separate entity is regarded as curtain or veil which cannot be generally pierced. But, when thisnotion of the Company or its Corporate identity is used to circumvent law, to defeat public policy, perpetuate fraud or illegality and used as a cover or façade to justify wrong, defend crime, to lend a name to private dealing, law will not regard the Company as a corporate entity and afford the protection which it otherwise entitled under the Company Law. When camouflaged transactions are carried on behind the legal façade, Court may lift this veil and look behind the artificial personality of the Company and identify the real personalities or natural persons operating behind the veil. This is one of such case where overwhelming evidence is available to show that the name of the Companies is used by the accused to make acquisitions by diverting the funds illegally amassed by A-1 during her tenure as Chief- Minister.

94.21) The facts and circumstances proved in the case undoubtedly establish that the accused have adopted an ingenious ploy or device in furtherance of their criminal conspiracy to shield the properties acquired through commission of offence. The illegally amassed wealth running to nearly 3000 acres of land is sparked in these shell Companies, obviously for the reason that this arrangement provides a convenient leeway to enjoy and deal with the properties registered in the name of the Companies and even dispose them of merely by passing a mere resolution. Therefore, the intention of the accused in buying over the above Companies and taking full control over the management thereof and thereafter acquire large number of properties in the name of the Companies undoubtedly manifests the criminal motive and intention of the accused attracting the ingredients of offence u/Sec. 13(1) (e) of the Act, R/w. Sec. 120-B of I.P.C.

94.22) In the preceding part of this judgment, I have already referred to the view held by the Hon'ble Supreme Court of India on this point, wherein, it is clearly held that the property in the name of an Income Tax assessee, by itself cannot be a ground to hold that it actually belongs to an assessee and that there is no embargo in getting the property registered in the name of one person, although the real beneficiary is another. In view of the above factual and legal position, I hold that the properties registered in the name of the above six Companies and which are the subject matter of the G.O. MS. No. 1183 dt. 25.09.1997 and G.O. MS. No.120 dt. 12.01.1997 issued by the State of Tamil Nadu is proved to be the properties acquired and held by A-2 to A-4 for and on behalf of A-1.

94.24) But, it is now well settled, that private individuals can also be prosecuted for conspiracy and abetment of offence of criminal misconduct along with the public servant under the provisions of the P.C. Act. The position of law in this regard is clarified by the Hon'ble Supreme Court of India in the case of P.Nallammal vs. State, 1999 Crl.L.J. 3967. It is observedthat acquisition and possession by a public servant, is capable of being abetted. It is held in the above decision that, there is neither an express or implied exclusion in the 1988 Act to deal with such a situation falling back on Sec. 109 of the Penal Code. The Legislature, while framing 1988 Act made no room for any doubt about the applicability of certain provisions of Penal code for offences under the Act. The absence of such a provision as found in the Corruption Act will only lead to the conclusion that the Legislature did not want to wipe out all the provisions of the Penal Code except Sec. 161 to 165-A which are found redrafted in the 1988 Act. U/Sec. 3 of the 1988 Act, the Spl. Judge has power to try not only any offences punishable under this Act, but also any conspiracy to commit or any attempt to commit or any abetment of any of the offences under the Act. The private individuals therefore can be prosecuted by the Court on the ground that they have abetted the act of criminal mis-conduct falling under Section 13(1)(e) of the 1988 Act committed by the public servant.

95. In the instant case, there is overwhelming evidence to show that at the relevant time, A-2 to A-4 did not have any source of income commensurate with the value of the properties purchased in their name and all the assets and pecuniary resources described in Annx. II including properties registered in the name of the above six companies were acquired out of the source provided by A-1. In this context, it may be pertinent to ascertain the antecedents of A-2 to A-4 and their financial status. As already stated above, A-2 to A-4 are not related to A-1 either by blood or through any other relationship. A-1 is a spinster. According to the prosecution, A-2 came to reside with A-1 at Poes Garden in the year 1988, which fact has not been disputed. PW.169 Sri. R. Krishna Murthy has stated about the occupation of the husband of A-2 stating that, Tr. M. Natarajan joined the Government service as Assistant to the then Social Service Dept. Later, he was placed as Information Public Relations Officer on 30.11.1970 and continued in that post till 31.07.1976. Later in 1980 he was posted in the same post and continued there till 1988. In his service records, he appointed his wife Sasikala as nominee. He had received Rs.3,000/- as scooter advance when he was PRO. Later to buy a constructed house, he availed a loan of Rs.84,700/- in 1987. In the same year he availed a loan of Rs.80,000/- to purchase a motor car. On 1.11.1988, he submitted his resignation but it was accepted in the year 1991 w.e.f. the date of his letter. In the cross-examination, it is elicited that PW.169 did not produce any document either in proof of availment of loan or with regard to the resignation by the husband of A-2. But it is not the case of A-2 that her husband is even now continuing in Govt. service. Under the said circumstance, there is no reason to disbelieve the testimony of this witness that, her husband was in Govt. service and he did not possess any substantial assets in his name.

95.3) No doubt it is true that, A-2 has produced certain Income Tax returns and has also filed wealth tax returns after she started residing with A-1 at Poes Garden claiming to have earned income through business carried on by her in partnership with A-1 under the name and style Jaya Publications and Sasi Enterprises. But all these properties are taken into consideration by the prosecution in Annx. I.

95.4) Coming to the financial status of A-3, PW.128 Balakrishnan has stated that on the application submitted by A-3, a site was allotted to A-3 by the Tamil Nadu Housing Board and through this witness the allotment file is marked as Ex.P.720. Along with the said application A-3 has produced the income certificate issued by the Tahsildar of Mambalam Guindy Taluk as per Ex.P.723 wherein, it is certified that the income of A-3 as on 28.07.1992 was Rs.44,400/- per annum. Added to that, he has submitted a declaration as per Ex.P.722 stating that as on that date, he and his wife or minor dependent child did not own any house or house site or flat and also not been allotted any other house to him. It is also the case of the prosecution that, until 1992, A-3 was only a student pursuing his studies and had no income whatsoever. Though A-3 has contended that he was possessed with substantial means and resources, A-3 has not produced any independent evidence in proof of his financial capacity to make large number of acquisitions in his name. The evidence produced by the accused suggest that, he had independently started a Super Duper TV which was later converted to Super Duper T.V. Pvt. Ltd., But I have already recorded a finding regarding the income generated by A-3 from the said business. Thus, the evidence on record clearly points out that A-3 had no independent source of income. Yet, large number of properties are seen to have been registered in his name. likewise, it is proved in evidence that A-4 had also no independent source of income. It has come in evidence that, she came to reside at Poes Garden after the untimely demise of her husband who was also in Govt. service and she received the death benefits of the deceased which were the only funds available at her disposal. She did not possess any immovable properties in her name. On the other hand, it is proved in evidence that, she was also allotted a site by the Tamil Nadu Housing Board as per Ex.P.719 and she had submitted a declaration to the effect that her annual income was only Rs.48,000/- in 1992. Even during her examination u/Sec.313 Cr.P.C., she has not disputed this fact, which goes to show that even A-4 did not possess any wherewithals to make the huge acquisitions in her name, but for the patronage of A-1.

95.5) It is proved in evidence that, during the check period, A-3 acquired the following properties either in his individual name or in the name of the firmor Companies viz., PROPERTIES STANDING IN THE NAME OF A-3 ANNEXURE - II Description of property (including document Value of the Sl.No. number property and in whose name it was purchased) (incl.

of stamp duty and registration charges 11 acres 83 cents in S.No.345/3B, 3A, 2, 5B, 2,33,770.00 60 5F, 5D, 5 5E 5C, 344/1 2, 402/4 F, , , , 401/1, 335/1 n Siruthavoor Village.

Tr. VN Sudhagaran.

10 acres 86 cents in S.No.392/1, 391, 392, 62 380, 2,11,325.00 393 398 400 i 381/3, , 405/3, , 406, 399, , 406 n Siruthavoor Village.

Tr.

V.N.Sudhakaran 7 acres 44 cents in S.No.339/1A, 341/1, 65 342/3A, 2A, 1,45,891.00 2B1, 2B2, 338/1A, 3, 342/3B, 4A, 235/3, 4,2, 234/1, 2 in Siruthavur Village.

Tr.

V.N.Sudhakaran (Doc.NO.43/94 DT. 5.2.94 OF SRO North Madras) Amount paid over and above the cost in 66 document 4,85,000.00 No.43/94 dt. 5.2.94 S.R.O. North Madras to the seller Tr.

One sixth individed share of land in 5 ground 153 and 10,87,196.00 1133 Sq. ft. in S.No.3334/1A of Luz, Avenue.

Tr.

V.N.Sudhakaran (Doc.No.249/95 dt. 21.3.95 of SRO, North Madras) Expenditure towards acquisition of Indo-

173 Doha 86,91,000.00 Chemicals and Pharmaceuticals Ltd., at Cuddalore.

New/ Additional construction in the building 6,40,33,901.0 Grape Garden Farm House in the limits of Jeedi Metla and Petpesherabad Villages in A.P. Cash Balance as on 30.04.96 in CB Guindy, 206 in CA 47,453.64 1245 opened on 2.1.95 in the name of Tmt. N.

Canara Bank Mylapore on Tr. VN Sudhakaran on 26.10.95 160 Amount paid to Madras Telephones from CA 2220 1,995.00 of Canara Bank Mylapore of Tr. VN Sudhakaran on 19.09.95, 7.11.95, 11.1.96, 26.2.96 and 26.4.96 (Rs.399 x 5) 161 Amount debited towards DD commission from CA 300.00 2220 of Canara Bank Mylapore of Tr. VN Sudhakaran on 16.7.93, 17.1.94, 19.1.94 and 14.5.94 162 Interest paid towards TOD from CA 2220 of 2,103.00 Canara Bank Mylapore of Tr. VN Sudhakaran on 31.12.94, 15.12.95 and 7.3.96 (Rs.813 + 930 + (360) 163 Amount paid to Tr. Krishna from CA 2220 of 2,500.00 Canara Bank Mylapore of Tr. VN Sudhakaran on 9.11.94 164 Amount paid to Post Master from CA 2220 of 399.00 Canara Bank Mylapore of Tr. VN Sudhakaran on 30.6.95 165 Amount paid to Upfront from CA 2220 of Canara 3,500.00 Bank Mylapore of Tr. VN Sudhakaran on 27.10.95 177 Amount paid to MMDA for allotment of a plot at 2,90,675.00 Door No.#-83, Besant Nagar, Madras by Tr. VN Sudhakaran on 3.3.93 and development charge of Rs.1500/- on 3.3.93 and scrutiny fee of Rs.475/- on 1.3.93.

1068 of Indian Bank, Abirampuram of Tr. VN Sudhakaran on 21.12.94 205 Amount paid towards T.C charges and Folio 125.00 Charges from CA 1068 of Indian Bank, Abirampuram of Tr. VN Sudhakaran on 16.4.94, 13.5.94, 15.3.95, 28.3.95 and 31.3.95 206 Amount paid to Temporary OD as interest from 388.00 CA 1068 Indian Bank, Abirampuram on 31.12.94 207 Amount paid to Tr. Srinivasalu on 12.5.95 from 4,410.00 CA 1068 of Indian Bank, Abirampuram of Tr. VN Sudhakaran 95.7) From other accounts, there have been many transfer to the above mentioned account. The details are as follows:-

As per Ex.P.1576 through many clearings credited were made on different dates in this current account. Similarly on different dates money was withdrawn in the form of cash. On 17.1.94 Rs.96,350/- on 26.12.94 Rs.5 lakhs, Rs.1,88,000/- on 18.3.95, 2 lakhs on 18.8.95 and over and above this, smaller amounts were withdrawn on different dates. A cheque dated 16.7.93 for Rs.16,81,000/- was issued to the bank and deducted from this current account. The cheques which were signed by V.N.Sudhakaran are indeed Ex.P.1577. This cheque was issued to the bank for the purchase of demand draft. There are 6 entries on 29.1.94. The cheques were issued due to each for Rs.5000/- to J. Real Estate, JJ Leasing J.S. Housing, Jaya Contractors, Green Farm, J. Farm House, and the amount was deducted from this current account.

An amount of Rs. 2 lakhs was transferred through cheque from this account to Sasikala's account C.A. No.2196 on 18.3.94. On 21.3.95 an amount of Rs.10,88,000/- was transferred to M/s. Anjaneya Printers (P) Ltd., account. On 14.5.94 a cheque was issued to the bank for a sum of Rs.82,500/- to purchase a D.D. which was deducted from this account. The application which was signed by Ram Vijayan to purchase a Demand Draft in the name of Muniyan for Rs.82,500/- is Ex.P.1578. A cheque for Rs.1,50,000/- in the name of Ramayi Ammal was presented on 21.3.95 and deducted from this account. The cheque dated 17.3.95 indeed is Ex.P.1579. On 22.3.95 cheque for Rs.7,50,000/-was presented to Indian Bank, Abirampuram Branch, and was deducted from this account. The cheque dated 17.2.95 indeed in Ex.P.1580. On 27.9.94 a cheque for Rs.12,00,000/- was issued in the name of Aiyya Durai which was deducted from this account. The cheque dated 24.9.94 which was signed by V.N.Sudhakaran is Ex.P.1581. On 15.10.94 a cheque issued for a sum of Rs.27,41,000/- in the name of IB Merchant Bank was deducted from this current account. The cheque dated 4.10.94 which was signed by V.N.Sudhakaran is Ex.P.1582. on 18.10.94 a cheque for Rs.9,00,000/- was issued in the name of Aiyya Durai and was deducted from this current account. The cheque dated 15.10.94 signed by V.N.Sudhakaran is Ex.P.1583. A cheque issued on 31.10.94 for a sum of Rs.6,00,000/- in the name of Aiyya Durai was deducted. The cheque dated 28.10.94 signed by V.N.Sudhakaran in Ex.P.1584.A cheque for Rs.24,05,000/- was issued on 26.11.94 to the bank to purchase a Demand Draft and the sum duly deducted from this account. This cheque dated 26.11.94 signed by V.N.Sudhakaran in Ex.P.1585. The computer printout showing the statement for the sum mentioned above for the purchase of the demand draft is Ex.P.1586 to Ex.P.1588. Three demand drafts for Rs.9,00,000/ - Rs.9,00,000/- and Rs.6,05,000/-were issued in the name of Interface Capital Market Pvt. Ltd., A cheque for Rs.2,55,000/- was issued on 9.12.94 in the name of Aiyya Durai and deducted. The cheque dated 5.12.94 signed by V.N.Sudhakaran is Ex.P.1589. A sum of Rs.75,000/- was deducted on 7.4.95 in the name of V.N.Sudhakaran. On 8.5.95 a sum of Rs.25,00,000/- was deducted in the name of Radha Venkatachalam. On 16.5.95 a sum of Rs.5,00,000/- was deducted through a cheque in the name of Sasikala."

95.8) The above evidence itself is sufficient to show that all the above acquisitions were made out of the funds diverted from the accounts of either A-1 or A-2 and A-3 and A-4 did not invest any funds either for acquisition of the immovable properties or for effecting improvements therein.

96) Another circumstance establishing conspiracy and abetment is the formation of large number of firms in the names of A-2 to A-4. It is not in dispute that, initially A-1 and A-2 had commenced partnership business by constituting two partnership firms by name Jaya Publications and Sasi Enterprises. As per PW.123 Jaya Publications was registered under the Sales Tax Act on 29.09.1988 in the Sales Tax office and its main business was printing. The object of the Company was offset printing for partnership. The original partners were A-1, A- 2 Divakaran and Dinakaran. The certificate of registration is marked as Ex.P.692. Ex.P.693 is the certificate issued by Central Sales Tax. This witness has categorically stated that, Jaya Publications did not file returns up to 1998 as per the Sales Tax Act.

96.8) Thus, it could be seen that the business activities in the name of A-2 to A-4 were started only during the check period and it is established in evidence that the said firms did not invest any funds of their own to run the business, instead, it is proved in evidence that, these firms facilitated A-1 and A-2 to transfer huge unaccounted money through the bank accounts held in the name of these firms.

96.9) In this context, it is pertinent to note that, at the commencement of the check period, there were hardly 10 to 12 bank accounts standing in the name of A- 1 and A-2, but during the check period there was indiscriminate opening of accounts, so much so, the witnesses have spoken about the opening of more than 50 bank accounts apart from the loan accounts held by the accused as here below:

96.10) PW.201 has given the details of the amounts transferred from the accounts held by other accused to the Current A/c. No.2018 of A-1 as under ;

Transfer of amount from Current A/c. No.2047 (Jaya Publications) to Current A/c.No.2018 (Ms. Jayalalitha A.1) Amount Date (Rs.) 05.08.1991 Rs.6 lakh.

96.11) Transfer of Amount from C.A.No.1952 (Namadu M.G.R. to C.A.No.2018) DateAmount (Rs.) 19.12.1991 3,00,000.00 20.11.1992 18,00,000.00 19.03.1993 5,00,000.00 05.07.1994 10,00,000.00 15.07.1994 5,00,000.00 08.08.1994 10,00,000.00 12.09.1994 15,00,000.00 14.09.1994 83,000.00 (transferred from SB A/c.No.23832 and Namadu MGR C.A No.1952 to this account (C.A.No.2018) 22.09.1994 5,00,000.00 21.01.1995 6,00,000.00 21.03.1995 7,00,000.00 17.07.1995 3,00,000.00 03.11.1995 7,00,000.00 08.11.1995 7,00,000.00 05.12.1995 5,00,000.00 10.01.1996 1,00,000.00 04.03.1996 3,00,000.00 96.12) Transfer from A/c.No.2196 Sasikala (Ac.No.2) to C.A.No.2018 Date Amount (Rs.) 01.10.1994 10,00,000.00 21.03.1995 15,00,000.00 19.04.1995 10,00,000.00 22.08.1995 8,00,000.00 17.10.1995 2,00,000.00 14.11.1995 10,00,000.00 05.01.1996 5,00,000.00 12.01.1996 15,00,000.00 04.03.1996 3,00,000.00 05.03.1996 1,00,000.00 14.03.1996 7,50,000.00 19.03.1996 5,00,000.00 02.04.1996 2,00,000.00 04.04.1996 25,00,000.00 96.15) It is not in dispute that, C.A. No. 1952 stands in the name of Namadhu MGR. According to P.W.1 this account was transferred to their bank from Kelly's Purasawakam Branch on 23.10.1989. The account stood in the name of 4 partners viz., A-1, A-2, Dinakaran and Divakaran. This witness has deposed about various amounts credited to this account No. 1952 in the form of cash and has listed about 313 entries exceeding the amount of Rs. 50,000/- credited to this account from time to time, which itself amounts to a total of Rs. 7,41,05,155.50.

98.1 In the instant case, the accused have failed to offer any satisfactory explanation as to the enormous unexplained credits entered into their bank accounts. Whatever explanation offered by the accused by way of confirmatory letters are proved to be false and bogus. The identity of the persons who provided the source is not proved. The transactions which resulted in the cash credit are also not established. As already discussed, the accused have rested their defence solely on the balance sheet and the profit and loss account statements said to have been filed before the Income Tax Authorities. But, the said documents are not proved in accordance with law and they are not in compliance with the statutory requirements. The auditors examined by the accused are found to be propped up to support the false defence set up by the accused. It is proved in evidence that the auditors examined by the accused did not handle their accounts during the check period and they were not conversant with the true facts. It is also proved in evidence that, the returns and the balance sheet and the profit and loss account were maneuvered solely with a view to offer an explanation to the huge unexplained credits entered in their respective bank accounts. As a result, the accused have failed to prove their defence even by the standard of preponderance of probability.

98.2) Even otherwise, mere declaration of property in the Income Tax returns does not amount to showing the same was acquired from the known source of income. The prosecution could show that, there was no real source of income with the assessees and the public servant is the real source. In the instant case, the prosecution has succeeded in proving beyond reasonable doubt that the only source for the acquisition of the large assets is A-1 herself.

98.3) It is proved in evidence that, all the remittances into the various bank accounts referred above were made by one Ram Vijayan and Jayaraman, the staff of A-1 working in her house at Poes Garden at the relevant point of time. PW.198 M. Jayaraman has categorically stated that, Mr. Vijayan used to deposit the money given to them in the names of the companies mentioned by A-2 in Canara Bank, Mylapore branch and Indian Bank, Abirampuram branch. He has specifically stated that, Tmt. Sasikala used to instruct him about the details of the bank to which the deposit should be credited and she used to send the amount either in suit cases or bags through domestic servants. This witness has further stated that, along with the money, she used to send challan books and PW.198 used to fill the challans as directed by A-2. In the course of his chief-examination he identified the challans for having remitted the amount which came to be marked as Ex.P.1123, P.1124, P.1139, P.1190, P.1299 and P.1304. He has also identified the signature of Mr. Vijayan in those challans and has stated that the said Vijayan is no more. The bank officers examined by the prosecution viz., PW.182 and PW.201 have identified large number of pay- in-slips marked as Ex.P.1035 - 1100 ; P.1122 - 1129 ; P.1299 - 1308 ; P.1636 - 1919 ; P.2032 - 2082 and have unequivocally stated that, most of these pay-in-slips bear the name of Vijayan as the person remitting the amount. This evidence undoubtedly establishes that even though large number of accounts were opened either in the names of accused or in the names of the firms or companies, yet, the remittance into the said accounts used to be made only by the staff of A-1 as per the instructions of A-2 who was managing all the financial affairs of A-1.

98.4) There is absolutely no evidence whatsoever to show that, during the check period, either the accused or the firms run by them credited any amounts to the various accounts maintained by them. Except in case of Super Duper T.V. Pvt. Ltd., no other firm or the Company has produced any documents to show that they transacted business during the check period and the income thereof was used to be credited to their bank account. On the other hand, the evidence produced before the Court points out that, all these firms had drawn the money which was transferred to their account either from the account of Namadhu MGR or Jaya Publications. The details of the transfers of such huge amount from Namadhu MGR and Jaya Publications to the bank accounts of the accused and the firms and the companies undoubtedly establish that all the monies credited into the accounts of the accused were from the accounts maintained by A-1 and A-2. In this regard, it is relevant to note that, A-2 has taken up a specific plea that, the large deposits collected from the various subscribers of Namadhu MGR amounting to more than Rs. 15 crores and the amount received by A-1 by way of gifts was credited to the account of Namadhu MGR, Jaya Publications and the other accounts opened in the name of the firms. But after thorough analysis of the evidence produced before the Court, I have recorded a definite finding that the plea set up by the accused is totally false. Under the said circumstance, the inevitable conclusion that would follow is that, the various amounts credited into the accounts of Namadhu MGR or Jaya Publications or the other accounts maintained by the accused is the unexplained wealth accumulated by A-1.

98.5) It is not the case of A-2 that, during the check period, she had made any remittances to the above accounts out of her income. As already discussed above, neither A-2 nor A-3 or A-4 had any independent source of income. Even though large number of firms had been constituted during the check period, it is proved in evidence that none of these firms transacted any business and there was absolutely no income from any of these firms. On the other hand, it is established that, all these firms and companies had received funds diverted from the bank account of A-1 and out of these funds, A-2 to A-4 acquired various properties described in Annx. II. As the accused have failed to prove even by preponderance of probability that, they had any independent source of income to acquire the assets found in their possession, it goes without saying that all the acquisitions were made out of the source provided by A-1. As a result, I hold that the prosecution has proved beyond reasonable doubt that the real source for acquisition of assets detailed in Annx. II is A-1 alone.

98.6) The whole gamut of evidence discussed above establish that the cash or pay orders or D.D.s are drawn from the different bank accounts for the purpose of acquisition of the assets. PW.201 and PW.182 have spoken in detail about the pay orders and the D.Ds issues by them at the instance of the accused. The cheques passed by the said banks or the D.Ds or pay orders issued by them directly co-relate to the details of the cheques or pay orders mentioned in the various sale deeds, thereby establishing the fact that the source for the purchase of these properties had flown from the account maintained in the name of the accused. But, as it is proved in evidence that the credits made into these accounts were from the unexplained resources of A-1, it necessarily follows that the funds for acquisition of all these assets are provided by A-1.

98.7) In view of the above finding, I hold that all the assets and pecuniary resources found in possession of A-2 to A-4 and in the name of various firms and the companies referred above actually belong to A-1. As the prosecution has proved beyond reasonable doubt that during the check period, A-1 was found in possession of assets and pecuniary resources of the total value of Rs.55,02,48,215.00 in her name and in the names of A-2 to A-4 and in the names of the firms and companies acquired by them, I hold that the prosecution has proved the ingredients of Sec. 13 (1) (e) of the P.C. Act.

99. In so far as the complicity of A-2 to A-4 in the alleged offence is concerned, there is overwhelming evidence indicating the circumstances of active abetment and conspiracy by the A-2 to A-4 in the commission of the above offence u/Sec. 13 (1)(e) of the Act. Though it is argued by the learned counsel for the accused that, except the fact that A-1 to A-4 were residing together under the common roof, there is no other evidence to show that they were parties to the criminal conspiracy, yet, the circumstances proved in evidence conclusively establish that all the accused acted in a concert with each other with the sole object to acquire and hold properties and assets disproportionate to the known source of income of A-1. The circumstances that have emanated from the evidence are as follows:

(i) It is not in dispute that, A-1 had executed a General Power of Attorney in favour of A-2 in respect of Jaya Publications. The said G.P.A is marked as Ex.P.995. Undisputedly, A-1 was a partner of the said firm and there was no necessity for her to execute any power of attorney in favour of A-2. The purpose behind executing the power of attorney in favour of A-2 appears to be to give her a free hand in the management of the Jaya Publications and on that guise, A-1 has taken up a defence that she was a dormant partner and was not aware of the transactions carried on by A-2. But, by executing the G.P.A. in favour of A-2, A-1 has rendered herself liable for all acts and deeds performed by A-2 pursuant to the powers conferred under the G.P.A. As already stated above, it is proved in evidence that substantial funds accumulated by A-1 were credited to the account of Jaya Publications and from the said account, it was diverted to the other accounts and ultimately was utilized for the acquisition of huge assets. Therefore, it has to be presumed that A-1 was aware of the transfer of these funds and the purpose for which these funds were transferred to the other accounts. Even otherwise, A-2 being the agent of A-1 was bound to keep A-1 posted with these facts. Therefore, it does not lie in the mouth of A-1 to contend that being a dormant partner she was unaware of the activities carried on by A-2. The circumstance of executing the power of attorney in favour of A-2 indicates that with a view to keep herself secure from legal complications, A-1 executed the said power of attorney knowing fully well that under the said powers, A- 2 would be dealing with her funds credited to her account in Jaya Publications.

(ii) Constitution of various firms during the check period is another circumstance establishing the conspiracy between the parties. As already stated above, at the beginning of the check period, A-1 and A-2 were involved in only two concerns by name Jaya Publications and Sasi Enterprises. But during the check period, as many as 18 firms have come into existence. But, it is proved in evidence that, none of these firms carried on any business during the check period. There is absolutely no evidence to show that any of the accused contributed any share capital or received profit from these firms. Receipt of share of the profits is a prima-facie evidence of partnership. But in the instant case, there is absolutely no evidence to show that during the check period, any of the partners received any share of the profits or contributed capital for the running of business. It has come in evidence that 10 firms were constituted in a single day with the identical terms and conditions, even though none of the firms carried on business in terms of the said deeds. In addition, A-2 and A-3 started independent concerns in their names during this period. Not satisfied with this, even the defunct companies are bought by the accused. But, what has transpired in the evidence is that except buying large number of properties, no other business iscarried on by any of these entities. It has also come in evidence that the accounts were opened during the check period and none of these firms or companies had their own accounts or independent resources. The circumstances proved in evidence undoubtedly establish that these firms are nothing but extentions of Namadhu MGR and Jaya Publications. They owed their existences to the benevolence of A-1 and A-2 and drew continued sustenance from the funds transferred to their accounts. Large amount of funds were diverted to these accounts giving a clear indication that the firms were constituted only with a view to siphon off the unlawful resources accumulated by A-1.

(iii) Though A-1 has feigned ignorance about the activities carried on by these firms, yet, it cannot be forgotten that the aforesaid firms and companies were operating from the residence of A-1. It is an admitted fact that, A-2 to A-4 was residing at Poes Garden along with A-

1. It cannot be believed that, being the Chief Minister of a State, she was unaware of the large scale activities carried on by the persons living in her own house using her own residential address. It has come in evidence that even the voters' list of accused were maintained at the address of A-1. Though in her 313 statement she has feigned ignorance of the dealings of A-2 to A-4, there is no explanation by A-1 as to why and for what purpose A-2 to A-4 were living with her.

Admittedly, they are not related to her either by blood or by any other relationship. Though the factum of A- 1 to A-4 residing together by itself may not lead to the inference that there was meeting of mind to pursue the object of conspiracy, but the larger question that would arise for consideration is, why did they reside under the same roof with A-1 when they are not related to each other?

(iv) The definite stand of A-2 to A-4 is that, they are not dependent on A-1 for their living. Each one of the accused claims to have independent business and independent source of living. They have even gone to the extent of asserting that their assets are purchased out of their own means and resources. Then, what made them to live with A-1 when each of them have separate family has not been explained. Admittedly, A-2 is married and has her own residence. A-1 has claimed that mementos and other gifts received by her are kept by her in the house of A-2 indicating that there was more than ordinary relationship between A-1 and A-2. The very fact, A-2 to A- 4 have engaged themselves in constituting firms and acquiring large tracts of land out of the funds provided by A-1 indicate that, all the accused congregated in the house of A-1 not for social living nor A-1 allowed them free accommodation out of humanitarian concern, rather the facts and circumstances proved in evidence undoubtedly point out that A-2 to A-4 were accommodated in the house of A-1 pursuant to the criminal conspiracy hatched by them to hold the assets of A-1.

v) It is vehemently argued that, A-1 has nothing to do with the firms established by A-2 to A-4 and she has been falsely implicated in the alleged offence at the instance of her political rivals. But, the very documents produced by the accused at Ex.D.61 reveals that before the Income Tax Authorities, the representative of A-1 himself had putforth an argument that Rs.1 crore was advanced by A-1 to Sasi Enterprises towards share capital and further it was submitted that on the security of the said amount, loan was borrowed by A-1, which argument is seen to have been accepted by the Tribunal. Even before this Court, there is abundant evidence to show that A-1 has issued cheques in favour of other accused and has filed applications for availing loan for the benefit of the firms. Under the said circumstances, I do not find any substance in the argument canvassed by the learned counsel that A-1 was totally ignorant about the dealings of the firms and is no way involved in the formation of the said firms.

vi) The flow of money from one account to the other accounts as detailed in the preceding paragraphs would establish beyond reasonable doubt that all the accused persons have actively participated in the conspiracy to launder the illgotten wealth of A-1 for purchasing properties in the names of the firms and the companies acquired by them. In this context, it is also pertinent to note that even though the assets and properties of the six companies were attached by recourse to the provisions of the Criminal Law Amendment Ordinance, the applications for vacating the attachment were filed more than two years after the date of attachment, making it evident that other than the accused herein, no other person was interested in the properties acquired by the accused in the name of the Companies.

vii) Apart from the flow of money from one account to the other, the conspiracy among the accused persons is also proved by the evidence of Sub-Registrar, North Beach, Sub-Registrar office-PW.159 and the evidence of PW.71 Radha Krishnan, Horticultural officer. I have elaborately culled out the evidence of these witnesses in the earlier part of the judgment. Both the above witnesses have unequivocally stated before the Court that, they were called to Poes Garden and on the instructions of the higher officers they attended to the errands at the instance of the accused. It has come in evidence that the Sub-registrar has bent the rules and has registered large number of documents by taking personal interest even though all these properties were undervalued. It is also shocking to note that, he even registered six documents without the names of the purchasers being entered in the documents, which indicate that the Sub-Registrar was also aware of the purpose and design of the accused. It can be presumed that, the District Registrar obliged to tour the entire district and register the properties at the residence of the purchasers, only to oblige A-1 and to assist her in the acquisition of huge properties.

100. Thus, the prosecution having proved beyond reasonable doubt the intention and object of A-2 to A-4 to acquire and hold the properties for and on behalf of A-1, I hold that A-2 to A-4 are liable for conviction for the offence u/Sec. 109 and 120-B of I.P.C. R/w. Sec. 13 (1) (e) R/w. Sec. 13 (2) of P.C. Act.

To sum up, the prosecution has proved beyond reasonable doubt the following facts constituting the offences charged against the accused viz., I. Total assets found in : Rs.55,02,48,215.00 possession of A-1 as on 30.04.1996 II. Total expenditure incurred : Rs.8,49,06,833.00 by the accused during the check period III. Total of (I) and (II) : Rs.63,51,55,048.00 IV. Total income of accused : Rs.9,91,05,094.00 from all sources as determined above V. Value of disproportionate assets and pecuniary resources found in possession of accused as on 30.04.1996 which has not been satisfactorily accounted.

Accordingly, answering Point Nos.1 to 3 as above, I proceed to pass the following:

ORDER Prosecution has proved beyond reasonable doubt that as against the income of Rs.9,91,05,094.75 and expenditure of Rs.8,49,06,833.00 during the check period, A-1 acquired and possessed in her name and in the names of A-2 to A-4 and in the names of the business enterprises acquired in their names immovable properties and pecuniary resources of the value of Rs.53,60,49,954.00 which she could not satisfactorily account. Hence, acting u/Sec. 248 (2) of Cr.P.C., A-1 is hereby convicted for the offence punishable u/Sec. 13 (1) (e) R/w. Sec. 13 (2) of P.C. Act.

Prosecution has proved beyond reasonable doubt that, A-1 to A-4 were parties to criminal conspiracy with the object of acquiring and possessing pecuniary resources and assets to the extent of Rs.53,60,49,954.00 beyond the known source of income of A-1. Hence, A-1, A-2, A-3 and A-4 are hereby convicted for the offence punishable u/Sec. 120-B of I.P.C. R/w. Sec. 13 (1) (e) R/w. Sec. 13 (2) of P.C. Act.

Prosecution has proved beyond reasonable doubt that A-2 to A-4 abetted the commission of the above offence by intentionally aiding A-1 in the acquisition and possession of pecuniary resources and properties disproportionate to her known source of income as above. Hence, A-2, A-3 and A-4 are hereby convicted for the offence punishable u/Sec.109 of I.P.C. R/w. Sec. 13 (1) (e) R/w. Sec. 13 (2) of P.C. Act.

SENTENCE For the offence u/Sec. 13 (1) (e) R/w. Sec. 13 (2) of the P.C. Act, A-1 Selvi. J. Jayalalitha, D/o. Late. Jayaram, is hereby sentenced to undergo simpleimprisonment for a period of four years and a fine of Rs.100 crores. In default to pay the fine amount, she shall undergo further imprisonment for one year.

For the offence punishable u/Sec. 120-B I.P.C., R/w. Sec. 13 (2) of P.C. Act, A-1 is sentenced to undergo simple imprisonment for six months and to pay fine of Rs. 1 lakh. In default to pay the fine, she shall undergo further imprisonment for one month.

For the offence punishable u/Secs. 109 of I.P.C., R/w. Sec. 13 (2) of P.C. Act, A-2 Tmt. Sasikala Natarajan, A-3 Tr. V.N. Sudhakaran and A-4 Tmt. J. Elavarasi are sentenced to undergo simple imprisonment for a period of four years each and to pay fine of Rs.10 crores each. In default to pay the fine amount, A-2, A-3 and A-4 shall each undergo further imprisonment for one year.

For the offence punishable u/Sec. 120-B of I.P.C. R/w. Sec. 13 (2) of P.C. Act, A-2, A-3 and A-4 each are sentenced to undergo simple imprisonment for a period of six months and to pay fine of Rs.10,000/- each. In default to pay the fine amount, A-2, A-3 and A-4 shall each undergo further imprisonment for one month.

Substantive sentences of imprisonment shall run concurrently.

Period of custody already undergone by the accused shall be given set off u/Sec. 428 of Cr.P.C.

It is further ordered that, necessary direction shall be issued to the concerned banks to remit the proceeds of the Fixed Deposits and the cash balance standing to the credit of the respective accused in their bank account and the proceeds thereof shall be appropriated and adjusted towards the fine amounts.

If after adjustment, still the fine falls short, the gold and diamond ornaments seized and produced before the Court (after setting apart 7040 grams of gold with proportionate diamond jewellery), as observed in the body of the judgment shall be sold to RBI or SBI or by public auction to make deficit of fine amount good. The rest of the gold and diamond jewellery shall be confiscated to the Government.

All the immovable properties registered in the names of Lex Property Developments Pvt. Ltd., Meadow Agro Farms Pvt. Ltd., Ramaraj Agro Mills Pvt. Ltd., Signora Business Enterprises (P) Ltd., Riverway Agro Products (P) Ltd., and Indo Doha Chemicals and Pharmaceuticals Ltd., which are under attachment pursuant to G.O. Nos. M.S. 120 and 1183, shall be confiscated to the State Government.

Out of the fine amount recovered as above, a sum of Rs.5 crores shall be made over to the State of Karnataka towards reimbursement of the cost of trial conducted in the State of Karnataka.

9. Learned Senior Counsel, appearing for the appellant in Crl.A.No.835/2014 argued as under:

He submitted that Annexure-I is the assets acquired before the check period. Annexure-II is the assets acquired at the end of the check period i.e. 30.4.1996. Annexure-III is the income during check period. Annexure-IV is the expenditure during check period. Annexure-V is Annexure-II (Assets at the end of the check period, i.e. 30.4.1996) minus Annexure-I (Assets before the check period). Annexure-VI is Annexure-IV (expenditure during check period) minus Annexure-III (income during check period). Annexure-VII is Annexure- V plus Annexure-VI.

The learned senior counsel further submits that the order of the Hon'ble Supreme Court was not fully complied with. Leading questions were put during the course of re- examination which is not permissible under the Indian Evidence Act. The judgment of the trial Court at paragraph-66 relating to item No.225 is based on the oral evidence of PW.198-Mr.Jayaraman. As against item No.225 in Annexure-IV, Rs.16,15,500/- has to be excluded. Accused No.1 was the Chief Minister from 24.6.1991 to 12.5.1996. In the year 1996, All India Anna DMK Party was defeated. DMK came to power. On 14.6.1996, Dr.Subramanian Swamy presented a private complaint before the Principal District and Sessions Judge, Chennai. Based on that, Crl.M.P.No.3238/1996 was registered. Learned Sessions Judge ordered for an enquiry under Section 202 of Cr.P.C. PW.240-Tmt.Letika Saran, the then DIG of Police, was ordered to conduct an enquiry and report within two months. She has misunderstood the order of the Court and collected various documents namely Income Tax Department Returns and documents from Banks. She recorded statements of 300 witnesses. These statements cannot be treated as statements recorded under Section 161 of Cr.P.C. She did not file any report. PW.240 sought for extension of time. Time sought was granted. The said order was challenged vide Crl.M.P.No.5755/1996 and the petition was dismissed on 4.9.1996 vide Ex.D.10.

He further submitted that PW.241-V.C.Perumal took up investigation. The Government passed an order directing to register a crime. Accordingly, Crime No.13/1996 was registered for the offences punishable under Section 13(1)(e) read with Section 13(2) of the Prevention of Corruption Act.

Sri L.Nageswar Rao, learned Senior Counsel appearing for the appellant in Crl.A.No.835/2014 argued as under:

He made submissions with regard to benami transactions, i.e. any person on behalf the public servant. The explanation under Section 13(1)(e) of the Prevention of Corruption Act deals with known sources of income received from any lawful source and intimated in accordance with provisions of law, Rules or Orders. The first part of the explanation deals with initial burden of proof of prosecution. Then the public servant has to establish his case by way of preponderance of probability. Lawful source of income means income earned through a source not forbidden in law. He also submitted in respect of Section 106 of Indian Evidence Act, 1872, particularly on the word 'especially'. He quoted that as per the Woolmington's case, everything has to be proved by the prosecution which may not be valid. Two essential pre- requisites for benami transactions are source of income and intention. The prosecution has to prove these two aspects. In other words, the person who asserts that there is a benami transaction has to establish the same by adducing evidence. In this case, the prosecution has not adduced any evidence in respect of benami transactions. The case cannot be decided on surmises and conjectures and it has to be decided based on evidence. 'Any person on his behalf' mentioned in Section 13(1)(e) of the Prevention of Corruption Act refers to wife and unmarried daughter. Benami Transaction (Prohibition) Act came into force from 19th May 1998. Prevention of Corruption Act was promulgated on 9th September 1989. Prior to 1989, benami transaction was not prohibited. There is no evidence to the effect that money has gone from A-1 to the companies of A-2 to A-4.

He further submitted that the trial Court erred in giving a finding that it cannot rely on the Income Tax records on the basis of the decision in Lalu Prasad Yadav's case. Lalu Prasad Yadav's case does not lay down any law and only an observation is made during the course of granting leave and on maintainability of the appeal preferred by the State of Bihar.

He further submitted with regard to the expert witnesses and how the expert witnesses have to be dealt by the Courts. He invited the attention of the Court to Section 45 of the Indian Evidence Act, i.e. Commentary on Sarkar's Evidence. He invited the attention of the Court to depositions of PWs.98, 116, 220 and exhibits P.649 and P.671. He further submitted that the valuation of the property is not based on scientific data. The Engineers have not actually verified with the sellers or shopkeepers about the value of the marbles, granites and other items. They valued some of the items on lumpsum basis. This is without any data. The price of marbles and granites would have been ascertained for the check period, i.e. 1991 to 1996, but this has not been done so.

He further submitted that in respect of item No.179 situated at Grape Garden Farm House, Jedimetla, Hyderabad, the Income Tax Appellate Tribunal has valued the property at Rs.1.50 crore, whereas the Engineers of Public Works Department, Government of AndhraPradesh, have valued the same at Rs.6,40,33,901/-. In respect of item No.181 situated at Door No.36, Poes Garden, Chennai, including new construction made at No.36-A, the Income Tax Appellate Tribunal has valued the property at Rs.2,11,85,400/-, whereas the Engineers of the Public Works Department, Government of TamilNadu, have valued the property at Rs.7,24,98,000/-. He further submitted that scrutiny report is prepared by the Assessment Officer in respect of marbles and granites and the Assessing Officer visited Bombay to collect the value of the marbles and granites and other similar items.

He further submitted that in TamilNadu, there is a custom to give gifts to political leaders by way of cash, gold, silver articles, etc. Gold is assessed at 21,280 grams. These items were indicated in Wealth Tax and Income Tax returns. Wealth Tax was paid. Gifts are lawful sources. There is no prohibition to receive gifts by way of gold or silver articles. Some of the gold and silver items were acquisitions were made prior to check period. This has been indicated in the check period. This is highly improper. Gift is permitted under the law. Acquisition of property is very significant in so far as check period is concerned. Check period will be decided by the Investigating Agency. He further submits that Fire Engine Water was used in order to push any gold articles hidden in the water tubes, but in vain.

Section 114(d) of the Indian Evidence Act, 1872, deals with presumption. Earlier investigation conducted by the Investigation Agency in Crime No.13/1996 registered on 18.9.1996 has to be taken into consideration. Crime No.14/1996 is the present crime number. Annexure-I need not be explained because it is prior to check period. Annexure-II is the property mentioned during the checked period. This has to be satisfactorily explained by A-1. Annexure-III relates to income during check period. Section 69 of the Income Tax Act, 1961, deals with unexplained income. Section 122 of the Transfer of Property Act deals with Gifts. Gold and silver articles acquired prior to check period has been mixed up to the articles acquired during the check period.

He further submitted that items of income is not included in Annexure-III. According to the prosecution, income from Grape Garden, Hyderabad is only Rs.5 lakh during check period, i.e. for 5 years, whereas according to A-1, it is Rs.52 lakh based on the income tax returns and inspection carried out by the Income Tax Authorities. Gifts were received in 1992. In 1991, A-1 became the Chief Minister. Gifts and cash were received to the tune of Rs.2.15 crore. Certain drafts were received from foreign countries, to the tune of Rs.77 lakh. This was shown in the income tax returns for the year 1992-93. The order passed by the Assessing Authority was subject matter of appeal before the Commissioner of Income Tax which is at Ex.P.2145. The Commissioner of Income Tax suggested that they have taken it as professional tax because politics is also a profession. The Commissioner of Income Tax who passed this order was examined as PW.15. The gifts in the form of gold jewellery were received prior to 1.7.1991, i.e. prior to check period. This is not the subject matter of this case. He further submits that he relies on the Appellate Court Order, i.e. Ex.P.2145.

He further submits that 'Namadhu MGR' started in the year 1989. It is a scheme. It is legally accepted by the Authorities. DMK was formed in the year 1967. All India Anna DMK was formed in the year 1972 by M.G.R. He relies on Exs.D.217 and D.231, assessment for the year 1991-92.

He further submits that PW.181 was appointed by the prosecution to ascertain the valuation of marriage arrangements made at the choultry. He gave him the drawing, choultry measurements and the pandal. He also gave details of expenses of marriage arrangements. DW.1-Ramkumar is the son of Sri.Shivaji Ganeshan. The party-workers also contributed for the marriage. The bride was the grand daughter of Sri.Shivaji Ganeshan. Notice was issued to A-1 alleging that she has spent Rs.91 lakh. Explanation was submitted by A-1. It was not accepted by the Assessing Authority. The Appellate Authority accepted the explanation. Evidence of PW.181 is hearsay. The expenditure of the marriage is highly inflated. The value of Tent or pandals were assessed at Rs.5,21,00,000/-.

Lawful source means not prohibited by law. Benami transaction was a permitted activity prior to 1988. No money has gone from A-1. The prosecution cannot infer that money was spent by A-1. Transfer of money should be established. The prosecution mixed up the properties of A-1 to A-4. This is an error committed by the prosecution. Income Tax Act is a fiscal statute. Prevention of Corruption Act is a penal statute. Assessment order of the Income Tax proceedings was to be given weightage in the absence of overwhelming evidence of the prosecution. Income tax proceedings are relevant. The trial Court ignored on the principle of minimal evidentiary value and relied on the ruling of the Patna High Court which was subsequently overruled. Non-schedule items are marbles and granites. Section 106 of the Indian Evidence Act was pressed into service by the trial Court. Though there was a scrutiny, assessment, enquiry, verifiable data, expertise, these aspects have not been considered by the trial Court. Gold jewellery were disclosed in Wealth Tax, Income Tax returns prior to check period. Fixed deposit receipts prior to check period should have been excluded.

He submitted that income from Jaya Publications deals with printing. 'Namadhu MGR' deals with Newspaper. Detailed enquiry was done by the Income Tax Authorities. The basis for connecting A-1 with A-2 to A-4 and 'Namadhu MGR' is illegal. With regard to marriage expenses, legal evidence is not looked into. The order which is set-aside by the Assessing Officer is taken into account. The case of A-1 was proved higher than the preponderance of probability. The trial Court erred in giving a finding that money has flown from A-1 to A-2 and A-2 to A-4 and companies. On assumption and surmises, the trial Court has come to a conclusion that money has parted from A-1 to A-2 and A-2 to A-4. According to the prosecution, A-3 and A-4 became Directors with effect from 17.8.1994. A-2 to A-4 resigned from directorship between 5.3.1996 to 12.3.1996. The company acquired six properties between 26.5.1993 to 30.4.1996. After accused Nos.3 and 4 became Additional Directors, no properties were acquired. Ramraj Agro Mills Ltd.is a publiclimited company existing since 1986. According to the case of the prosecution, this Company has constructed two servant quarters and a compound wall. Ex.P.822 is the estimation report and cost of construction.

Nearly 65 rulings were cited by the learned Senior Counsel Sri. L. Nageswara Rao and Sri. B. Kumar appearing for the appellant in Crl.A.835/2014, which are as follows:

1. VARKEY JOSEPH V/S. STATE OF KERALA reported in 1993(3) SCC 745;

2. JAGAN M. SESHADRI V/S. STATE OF TAMILNADU reported in (2002)9 SCC 639;

3. RAJARAM V/S. STATE OF RAJASTAN reported in (2005)5 SCC 272;

4. KUNJU MUHAMMED @ KHUMANI & ANOTHER V/S. STATE OF KERALA reported in (2004)9 SCC 193;

5. RAHIM KHAN V/S. KHURSHID AND OTHERS reported in (1974)2 SCC 660;

6. ASHOK TSHERING BHUTIA V/S. STATE OF SIKKIM reported in (2011)4 SCC 402;

7. DEVARAPALLI LAKSHMINARAYANA REDDY & ORS. V/S. V.NARAYANA REDDY & ORS. reported in (1976)3 SCC 252;

8. P.SIRAJUDDIN, ETC. V/S. STATE OF MADRAS ETC. reported in (1970)1 SCC 595;

9. LALITA KUMARI V/S. GOVERNMENT OF UTTAR PRADESH & ORS. reported in (2014)2 SCC 1;

10. BABU RAO CHINCHANASUR V/S. STATE BY LOKAYUKTHA POLICE, BANGALORE URBAN DISTRICT, BANGALORE AND ANOTHER reported in 2013(4) KCCR 3245;

11. H.N.RISHBUD & INDER SINGH V/S. STATE OF DELHI reported in (1955)1 SCR 1150 : AIR 1955 SC 196 : 1955 CRL.LJ 526;

12. STATE OF HARYANA & ORS. V/S. BHAJANLAL & ORS. reported in 1992(1) SCC 335;

EMPEROR reported in AIR(34) 1947 PRIVY COUNCIL 67;

15. KRISHNANAND AGNIHOTRI V/S. THE STATE OF MADHYAPRADESH reported in (1977)1 SCC 816;

CUSTODIAN & OTHERS reported in (2004)8 SCC 355;

19. R. RAJAGOPAL REDDY (DEAD) BY LRS. & OTHERS V/S. PADMINI CHANDRASEKHARAN (DEAD) BY LRS. reported in (1995)2 SCC 630;

20. ALLAHABAD BANK V/S. CANARA BANK & ANOTHER reported in (2000)4 SCC 406;

21. MAYA MATHEW V/S. STATE OF KERALA AND OTHERS reported in (2010)4 SCC 498;

23. JAYADAYAL PODDAR (DECEASED) THROUGH LRS AND ANOTHER V/S. MST. BIBI HAZRA AND OTHERS reported in (1974)1 SCC 3;

24. VALLIAMMAL (D) BY LRS. V/S. SUBRAMANIAM & OTHERS reported in (2004)7 SCC 233;

25. HEIRS OF VRAJLAL J. GANTARA V/S. HEIRS OF PARSHOTTAM S. SHAH reported in (1996)4 SCC 490;

26. M.SREERAMULU V/S. STATE OF A.P. reported in MANU/AP/1100/2003;

27. SHYAMA CHARAN SAXENA V/S.

COMMISSIONER OF INCOME TAX reported in MANU/UP/0127/1983;

28. SUBHASH KHARATE V/S. STATE OF MP reported in MANU/MP/0243/2000;

29. KALI RAM V/S. STATE OF HIMACHAL PRADESH reported in AIR 1973 SC 2773;

30. SHAMBU NATH MEHRA V/S. STATE OF AJMER reported in 1956 SCR 199 : AIR 1956 SC 404 : 1956 CRL.LJ 794;

31. ATTYGALLE & ANOTHER V/S. THE KING reported in 44 LW 86;

32. STEPHEN SENEVIVATNE V/S. THE KING reported in 44 LW 661;

33. K.C.BUILDERS AND ANOTHER V/S. ASSISTANT COMMISSIONER OF INCOME TAX reported in (2004) SCC (CRL) 1092.

34. K.T.M.S.MOHD. & ANOTHER V/S. UNION OF INDIA reported in (1992)3 SCC 178;

35. DSP, CHENNAI V/S. K.INBASAGARAN reported in (2006)1 SCC 420;

36. RADESHYAM KEJRIWAL V/S. STATE OF WEST BENGAL AND ANOTHER reported in (2011)3 SCC 581;

APPELLANT V/S. STATE OF INSPECTOR OF POLICE reported in CRL.A.(MD) NO.1472/2002 & M.P.NO.1/2010.

38. STATE OF BIHAR V/S. LALU PRASAD AND ANOTHER reported in 2008 CRL.LJ 2433;

39. LALU PRASAD YADAV & ANOTHER VS. STATE OF BIHAR & ANOTHER reported in 2010 (5) SCC 1;

40. P. SATYANARAYANA MURTHY VS. STATE OF ANDHRA PRADESH reported in 1992 (4) SCC 39;

41. SURAJ MAL VS. STATE (DELHI ADMINISTRATION) reported in 1979 (4) SCC 725;

42. AKIL ALIAS JAVED VS. STATE (NCT OF DELHI) reported in 2013 (7) SCC 124;

43. GURCHARAN SINGH VS. STATE OF HARYANA reported in MANU/PH/0827/1993;

44. DHANESWAR THAKUR VS. STATE OF PATNA reported in MANU/BH/0132/1958;

45. STATE OF H.P. VS. JAI LAL & OTHERS reported in 1999 (7) SCC 280;

46. DAYAL SINGH & OTHERS VS. STATE OF UTTARANCHAL reported in 2012(8) SCC 263;

47. SIDHARTHA VASHISHT ALIAS MANU SHARMA VS. STATE (NCT OF DELHI) reported in 2010 (6) SCC 1;

48. CHAND KAAN & ANOTHER VS. STATE OF UP reported in 1995 (5) SCC 448;

49. ABHAYA SOOD VS. BABU BATUK NATH & OTHERS reported in MANU/UP/2648/2012;

50. BHAGIRATH VS. STATE OF MADHYA PRADESH reported in 1976 (1) SCC 20;

51. RAMESH CHANDEA AGRAWAL VS. REGENCY HOSPITAL reported in 2009 (9) SCC 709;

52. KESHAV DUTT VS. STATE OF HARYANA reported in 2010 (9) SCC 286;

53. M. KRISHNA VS. STATE OF KARNATAKA reported in 1999 (3) SCC 247;

55. C.S.D. SWAMI VS. STATE OF PUNJAB reported in 1960 (1) SCR 461;

56. RAMAIAH ALIAS RAMA VS. STATE OF KARNATAKA reported in 2014 (9) SCC 365;

57. R.V.E. VENKATACHALA GOUNDER VS.

ARULMIGU VISWESWARASWAMI & V.P.

TEMPLE AND ANOTHER reported in 2003 (8) SCC 742;

58. FAIZ MURATAZA ALI VS. COMMISSIONER OF INCOME TAX reported in 2013 SCC ONLINE DEL. 717;

59. HEAVY ENGINEERING MAZDOOR UNION V/S/ STATE OF BIHAR & OTHERS. reported in 1969 (1) SCC 765;

60. WESTERN COALFIELDS LIMITED VS. SPECIAL AREA DEVELOPMENT AUTHORITY, KORBA & ANOTHER reported in 1982 (1) SCC 125;

61. ANEETA HADA VS. GODFATHER TRAVELS AND TOURS PRIVATE LIMITED reported in 1986 (2) SCC 661;

62. R.S. NAYAK VS. A.R. ANTULAY & ANOTHERS reported in 1986 (2) SCC 716;

64. K. VEERASWAMI VS. UNION OF INDIA AND OTHERS reported in 1991 (3) SCC 655

65. R. RAJAGOPAL ALIAS R.R. GOPAL AND ANOTHER VS. STATE OF T.N. AND OTHERS reported in 1994(6) SCC 632;

Sri. R. Basant, the learned Senior Counsel appearing on behalf of the appellant in Crl.A. No.836/2014 submits that accused No.2 is woman having means. She was carrying on business viz., Vinod Video Vision prior to coming in contract with accused No.1. He submits that what is not prohibited is lawful as per explanation to Section 13(1)(e) of the Prevention of Corruption Act. The Investigating Officer have put properties of accused Nos.1, 2, 3, 4, firms and companies in one basket and assessed the value of assets of the accused and entities to the extent of Rs.64,42,89,616/-. He also made submission with regard Section 106 of the Indian Evidence Act. He submits that initial burden is on the prosecution to prove its case and after the prosecution discharged the initial burden, the burden shifts on the defence. In case if the investigation agency is unable to investigate in respect of the income of the accused, then Section 106 of the Indian Evidence Act has to be pressed into service. He also submitted according to the DVAC manual, the Investigation Officer was authorized to collect proceedings from the Income Tax Department. He also submits that trial is not fair and charges are vague. No funds have been transferred from the account of A-1 to A-2. Accused No.2 is a Wealth Tax Assessee in the year 1987-88. She was Income Tax assessee way back in the year 1993. Accused No.2 was having sufficient income. He has invited the attention of this Court to the depositions of PWs.94, 98, 107, 116, 117, 155, 144, 149, 182, 190, 198, 201, 220, 238 and Exs.P46, P61, P241, P.242, P245, P279, P664, P673, P788, P798, P910, P911, P1189, P1207, P1377, P1510, P1903, P1921, P1922, P1940, P2081, P2191, P2208, P2209, P2245, P2264, P2316, and Exs.D220, D218, D239, D254, D261, D272, D273, D290, D297, D300, D305, D371, D376, D377. He has cited the following rulings:

1. OMA @ OMPRAKASH & ANOTHER V/S STATE OF TAMILNADU reported in 2013(3) SCC 440;

2. STATE OF TAMIL NADU V/S. J. JAYALALITHA reported in 2000(5) SCC 440;

3. SHIV KUMAR V/S. HUKAM CHAND & ANOTHER reported in 1999(7) SCC 467;

4. B. JANAKIRAMAIAH CHETTY V/S. A.K. PARTHASARATHI & OTHERS reported in 2002 CRL.L.J. 4062;

5. SRI. K.V. SHIVA REDDY V/S. STATE OF KARNATAKA REP. BY ITS SECRETARY & OTHERS reported in ILR 2005 KAR 4780.

Sri T.Sudanthiram, the learned Senior Counsel appearing on behalf of the appellant in Crl.A. Nos. 837/2014 and 838/2014 submits that in respect of six Companies particularly, in respect of Super Duper TV Pvt. Ltd., investigation agency has not collected any evidence to establish the offence punishable under Sections 109 and 120-B of the Indian Penal Code. The prosecution has to stand on its own legs and not on the weakness of the defence. There is no direct evidence in respect of accused Nos.3 and 4. There is no evidence with regard to the source of income which has been parted from accused No.1 into the accounts of accused Nos.3 and 4. He has cited the following rulings:

1. P. NALLAMAL & ANOTHER VS. STATE REPRESENTED BY INSPECTOR OF POLICE reported in 1999 (6) SCC 559;

2. DR. S. L .GOSWAMI V/S STATE OF MADHYA PRADESH reported in 1972 (3) SCC 22;

3. NARENDRA SINGH & ANOTHER V/S STATE OF MADHYA PRADESH reported in 2004(10) SCC 699;

4. RUSTOM CAVASJEE COOPER V/S UNION OF INDIA reported in 1970 (1) SCC 248;

5. SUJIT BISWAS V/S STATE OF ASSAM reported in 2013 (12) SCC 406;

6. PADAM SINGH V/S STATE OF UP reported in AIR 2000 SC 361.

Sri.Udaya Holla, the learned Senior Counsel appearing on behalf of the appellants in Crl.A. Nos. 17/2015, 19/2015 and 20/2015 submits that no notice has been issued to the appellants. Without issuing the notice, passing an order of confiscation is bad in law. He further submits that Ramraj Agro Mills Pvt. Ltd. is a public limited company. The other companies are private limited companies. They are not individuals. Therefore, without issuing notice to the Managing Director or to the Company Secretary, passing an order of confiscation is not proper. Therefore, he seeks to set-aside the impugned order of attachment and confiscation. He has cited the following rulings:

1. STATE BANK OF INDIA V/S. RAJENDRA KUMAR SINGH AND OTHERS reported in AIR 1969 SUPREME COURT 401;

2. MRS. BACHA F. GUZDAR, BOMBAY V/S.

COMMISSIONER OF INCOME TAX, BOMBAY reported in AIR 1955 SUPREME COURT 74(1);

3. ELECTRONICS CORPORATION OF INDIA LTD.

AND OTHERS V/S. SECRETARY, REVENUE DEPARTMENT, GOVT. OF ANDHRA PRADESH & OTHERS reported in 1999(4) SUPREME COURT CASES 458;

Sri. Jayakumar S. Patil, the learned Senior Counsel appearing on behalf of the appellant in Crl.A. No. 18/2015 submits that without issuing notice to the concerned party, passing an order of confiscation and attachment is bad in law.

Sri.Aditya Sondhi, the learned Senior Counsel appearing on behalf of the appellants in Crl.A. Nos. 21/2015 and 22/2015 submits that the notice prior to an order under Section 452 of Cr.P.C. is must. He further submits that even where the accused has participated in the Trial, separate notice and inquiry must be carried out prior to passing an order under Section 452 of Cr.P.C. He further submits that the learned Trial Judge has failed to appreciate that the appellant is a separate legal entity that is distinct from its Directors viz., accused Nos.3 and 4. The impugned order is vitiated as the appellant, being a separate legal entity having a distinct character ought to have been necessarily arraignedas an accused. The learned Trial Judge has failed to consider the documents pertaining to the appellant hadnot discussed with respect to the appellant in the impugned order. The appellant was subjected to the proceedings under Section 148 of the Income Tax Act, 1961, for income escaping assessment.

He further submits that after due enquiry, the Income Tax Authority recorded the statement of individual shareholders of the appellant, who have contributed to its share capital and dropped the proceedings and it became final. The Department of Revenue has not preferred any revision. In such circumstances, it is clear that the property is duly that of the appellant and there is no consideration towards purchase of property that has flowed from accused Nos.3 and 4 much less, accused No.1, who is a public servant. The initial burden lies on the prosecution. This burden has to be strictly discharged by adducing legal evidence of a definite character. It is not enough merely to show circumstance that may show suspicion as the Court cannot decide on the basis of suspicion but must act on the acceptable evidence. The prosecution must discharge this burden beyond reasonable doubt. The prosecution has failed to show that any consideration has move from A-1 towards acquisition of property in question. He further submits that the share capacity of the appellant is Rs.1.32 Crores subscribed by independent shareholders. He draws the attention of this Court to Ex.D193 (Volume IX, Page 171). The said share capital is more than sufficient to acquire the assets, which are valued at around Rs.18 Lakhs. Further, the appellant has its own bank account. Attention of this Court was drawn to Ex.P1294 (Volume IX, Page 104). The sale deed through which the properties purchased are duly registered. The mode of payment was through the Demand Drafts. The vendors of the sale deeds have also deposed in this regard.

He has cited the following rulings:

1. STATE BANK OF INDIA V/S. RAJENDRA KUMAR SINGH AND OTHERS reported in AIR 1969 SUPREME COURT 401;

2. ISMAIL S/O IBRAHIM SAVAL V/S. STATE OF KARNATAKA AND ANOTHER in Crl.A.

No.200/1994;

3. N. MADHAVAN V/S. STAE OF KERALA reported in 1979(4) SCC 1;

4. BASAPPA DURGAPP KURUBAR & ORS. V/S.

THE STATE OF KARNATAKA & ANOTHER reported in 1977 Cri.L.J. 1541;

5. RUSTOM CAVASJEE COOPER V/S UNION OF INDIA reported in 1970 (1) SCC 248;

6. SOLOMON V/S. A SALOMON & CO. LTD., reported in 1897 AC 22;

7. VODAFONE HOLDINGS B.V. V/S. UNION OF INDIA & ANOTHER reported in (2012) 6 SCC 613;

8. ANEETA HADA V/S. GODFATHER TRAVELS & TOURS PVT. LTD., reported in 2012(5) SCC 661;

9. COMMISSIONER OF INCOME TAX V/S.

SOPHIA FINANCE LTD., reported in 1994 205 ITR 98;

10. DSP CHENNAI V/S. K. INBASAGARAN reported in 2006(1) SCC 420;

11. M. KRISHNA REDDY V/S. STATE DEPUTY SUPERINTENDENT OF POLICE, HYDERABAD, reported in 1992 (4) SCC 45;

12. KTMS MOHD. & ANOTHER V/S. UNION OF INDIA reported in 1992 (3) SCC 178;

13. KRISHNANAND AGNIHOTRI V/S THE STATE OF MADHYA PRADESH reported in 1971 (1) SCC 816;

OPPOSITE PARTIES in OJC NO.6466/2013 Learned Special Public Prosecutor, Sri. B.V. Acharya has filed the written arguments on behalf of the State of Karnataka as under:

The appeals filed by the appellants are not maintainable in law. According to the law settled by the Supreme Court, the sole prosecuting agency is the State of Karnataka and in the appeals, the Public Prosecutor validly appointed by the State of Karnataka has to be heard. In all the above appeals, very significantly, the State of Karnataka which is the sole prosecuting agency has not been made a party. Omission to implead the State of Karnataka as a party is a fatal defect and as the defect has not been cured even subsequently, aforesaid appeals are liable to be dismissed in limine as not maintainable. Order of conviction cannot be set-aside as claimed by the appellants unless the sole prosecuting agency viz., State of Karnataka is made a party. The prosecution has fixed the check period as 1.7.1991 to 30.4.1996. There is charge of conspiracy against all the four accused punishable under Section 120-B of IPC. There is also an alternate charge that accused Nos.2 to 4 have abetted the commission of the offence by the 1st accused under Section 13(1)(e) of Prevention of Corruption Act, read with Section 13(2) of the Act. It is the prosecution case that A1 is a public servant and has abused the position as Chief Minister of the State and has amassed wealth disproportionate to her known source of income. It is the case that all the four accused have conspired for committing these offences and Accused Nos.2, 3 and 4 have actively assisted A1 in achieving this object. In the present case, it is the case of the prosecution that all the assets have been acquired by accused No.1 in her name or in the name of other accused or in the name of as many as 32 business enterprises of which one or the other accused have been acquired in the name of these companies is established by documentary evidence on record and the same is beyond dispute. In this connection, reference is drawn to the evidence of PW71- Radhakrishnan, Officer of the Horticulture Department who speaks about the circumstances under which various items of agricultural lands were purchased. Reference is also drawn to the evidence of PW94- Lakshminarayana who speaks about the registration of various firm/companies. So also PW159-Rajagopalan speaks about registration of documents at the residence of A1 at Chennai. It is the contention of the accused that the prosecution has failed to prove that all these assets have been acquired from out of the funds of accused No.1. It is no doubt true that the prosecution has to establish that the properties have been acquired from out of the ill- gotten wealth of accused No.1. According to the prosecution this part of the case has been very satisfactorily established by the prosecution by leading clinching circumstantial evidence. It is not prudent to expect direct evidence on this aspect. The same has to be only by way of circumstantial evidence. A case of the conspiracy is generally proved only be leading circumstantial evidence and the Court will have to draw proper inferences from the circumstances which are established in the case. In the present case, such evidence proving various circumstances from which the required inference can be drawn has been proved. It is settled law that the court will have to consider the cumulative effect of all the circumstances so proved and not merely refer to certain circumstances here and there and say that the case has not been proved. It is established that accused Nos.1 to 4 were residing together in No.36, Poes Garden, which is the official residence of accused No.1 That they were residing together, coupled with other circumstances show that they have acted in concert. Admittedly, A1 and A2 are partners in Jaya Publication and Sasi Enterprises. In fact, it is in evidence that most of the registered Sale Deeds have been actually registered at the residence of accused No.1 by the Registrar who has come to her house for the said purpose. These are some of the significant features of this case. It is also in evidence that neither A2, A3, A4 had any independent source of income to acquire such valuable properties. The status and income of accused No.1 has been discussed by the Trial Judge in para-95 of the judgment. Similarly, A3 and A4 also did not have independent income earlier to the check period. It is in evidence that A3 is none other than foster son of A1 and he is also a close relative of A2. The relationship between A2 and A4 is also admitted. The trial Judge on an elaborate discussion of the evidence on record has rightly come to the conclusion that none of these accused had any independent source of income to purchase the valuable assets which admittedly have been purchased in the names of various companies of which, either A2 or A3 or A4 were partners or Directors. Some of the companies which were not doing any business or profit have been acquired by A2, A3 and A4 only for the purpose of acquiring properties, source of which is from Accused No.1. Thus, it has to be noted that the Trial Judge has relied on only such circumstances which are very satisfactorily established by the documentary evidence only. The trial Court in its judgment at para-97 has pointed out that how huge unexplained cash amounts were credited into the various accounts standing in the name of accused or the companies owned by them. He has also pointed out how the accused have failed to explain these credits. The trial Court has also pointed out that how though there were different accounts in different Banks in the name of different companies, the accused were treating all these accounts as one by transfer of funds from one account to other without any reason. The trial Court on appreciation of the entire evidence on record, it will be seen that during the check period, accused No.1 was found to be in possession of assets and pecuniary resource of not less than Rs.55 crores though the said assets have been standing in the names of A1 to A4 or the various Companies owned by them. It is contended that in view of the provisions of Benami Transactions (Prohibition) Act 1988, (hereinafter referred to as Benami Act) are not attracted to the facts of the present case. The Legislature realizing that offence of acquiring disproportionate assets is generally resorted to by acquiring property in the name of any other person has deliberately used the expression "he or any person on his behalf is in possession". If in a given case, it is shown that the consideration for acquiring the property as flown from the public servant concerned, he is guilty of the offence even though the property may stand in the name of any other person or company. In the instant case, the circumstances clearly establish that it is in effect, accused No.1 who has been in possession of the property or pecuniary resource though the same may be standing in the name of different person or companies. Hence, the arguments based on Benami Act is liable to be rejected. The accused Nos.1 and 2 in an attempt to disprove the case of the prosecution have tried to establish that during the check period, Jaya Publications of which they are the partners, they have received interest free deposit to the extent of 13 crores and odd from thousands of subscribers on promise of supply of free copies of the magazine. According to the prosecution, this whole claim is false and in an attempt to substantiate this claim, accused No.1 and 2 have not only put forward a false case, but have also fabricated evidence. According to the accused, the scheme was formulated in 1990 and that substantial sum was to the extent of over 13 Crores were collected for the assessment year 1992-93, 1993-94, 1994-95. It is very significant to note that during this period, neither accused Nos.1 and 2 in their individual capacity nor the firm Jaya Publications filed any income tax returns. The returns showing receipt of this interest free deposit are filed before the Income Tax authorities only after the registration of the present case and filing of the charge sheet. In fact, the returns for assessment year 1992-93 was filed on 6.11.1998 and for 1994-95 were filed on 17.03.1998. Evidently, the accused have thought of putting forward this theory of deposit claim after the registration of the present case. It is seen that in doing so, the accused were trying to get the assistance of the authorities of the Income Tax by filing belated returns. However, when the Income Tax Authorities sought the original subscription forms on behalf of the accused, it was submitted that those forms, counterfoils etc., which are kept in a cardboard box in a Tata Sumo vehicle parked in a hotel and the same are missing. It was also claimed that a complaint in this behalf had been given to the Police, but no document is produced to prove this fact. It is interesting to note that though these documents are claimed to have been lost during the trial, the accused surprisingly summoned these very documents from the Income Tax Authorities and that were produced before the Court. The learned trial Judge on a detailed examination of the evidence with regard to these documents has come to the conclusion that they all appeared to have been fabricated. The circumstances establish beyond doubt that the theory of receipt of interest free deposit over 13 crores is only an afterthought invented for the purpose of this case. The trial Court in para- 50 of the judgment has discussed the evidence on this aspect and has categorically come to the conclusion that not only the evidence tendered in this behalf is false, but several documents have been fabricated. DW.88-Auditor who is a star witness has clearly contradicted himself on several aspects as pointed out by the Trial Court. This conclusion arrived at by the learned judge is fully justified on the material on record and to avoid repetition, it is prayed that this Court may be pleased to peruse the discussion at para-50.1 till para 50.23. The result of the discussion is not only to show that the so called explanation offered by the accused is false, but also that the accused have fabricated the evidence in support of their case. It is submitted that to the extent of 13 Crores and odd even on the admission of the accused, there is disproportionate asset if the explanation by way of receipt of interest free deposit is found to be not true. In the circumstances, adverse inference will have to be drawn against the accused and the consequent result is at least to the extent of Rs.13 Crores and odd, the case of the prosecution regarding possession of the disproportionate asset or pecuniary resources finds full corroboration. If on this aspect of the matter, the conclusion arrived at by the trial Court is correct, to the extent of Rs.13 Crores, the Prosecution evidences gets corroborates from the version of the accused themselves. The expenditure incurred by the accused during the check period was a sum of Rs.12,00,59,338.76/-. To substantiate the case of the prosecution, 42 witnesses were examined in this regard. The evidence of these witnesses is cogent and consistent and the accused have not been able to elicit much in the cross-examination. One such item of expenditure included a sum of Rs.6,47,04,222/- which were expenses incurred by accused No.1 for the purpose of the marriage of her foster son accused No.3. The special Judge after giving due consideration to the evidence on record has given valid reasons justifying the reduction of this expenses to about Rs.3 Crores and also taking into consideration various other expenses incurred has arrived at the final value of expenditure of Rs.8,49,06,833/-. This amount arrived at is on the basis of the entire evidence being appropriately scrutinized and no other conclusion can be arrived at on the basis of the material on record. The case of the prosecution was that there were 306 items of assets acquired by the accused. These items were substantiated through documents and also through various witnesses examined in this behalf. As against the said 306 items, the Special Judge has scrutinized each item in detail and has given a finding that the value of the assets acquired during the check period was Rs.55,02,48,215/-. This value arrived at is after giving deduction to various items which according to the special Judge, the prosecution had not been able to fully establish. The values arrived at was on the basis of the evidence of valuers who were examined as prosecution witnesses and on the basis of the documents in support of the acquisition of these assets. The trial Court in para 87.9 has in a tabular form extracted the nature of the assets and its corresponding value which the prosecution has been able to prove through cogent and consistent evidence. It is the case of the prosecution that during the check period, the 1st accused with the assistance of other accused has acquired and come into possession of various assets both movable and immovable. It is significant to note that acquisition of these properties cannot be disputed as they are all covered by registered documents. Even if the evidence regarding payment of cash over and above the price shown in the Sale Deeds are excluded, over more than Rs.20 Crores have been paid towards the price of these properties and regarding this acquisition, there cannot be any dispute at all. That these properties have been acquired in the names of various companies in which the accused are interested either as Partners or Directors is also beyond doubt. The prosecution has established that none of the accused had any independent means to pay and purchase these properties by paying valuable consideration. In the circumstances, the conclusion arrived at by the Trial Court that the accused have acquired these immovable properties is beyond any challenge. Item No.3 in para 87.9 shows the new or additional construction of buildings and the total value of which exceeds Rs.22 Crores. The gold and diamond jewellery found is also more than Rs.2.5 Crores. The Shares and Fixed Deposit which are beyond dispute are also to the extent of Rs.3 Crores and 42 Lakhs and odd. The value of the vehicles as found in column 8 is also to the extent of Rs.1,29,00,000/-. Thus, in paragraph 87.9, the trial Court has rightly concluded that the prosecution has proved beyond doubt the acquisition of disproportionate assets to the extent of Rs.55 Crores. The finding recorded by the Trial Court does not suffer from any infirmity and there are no grounds made out for interference by this Court.

Dr. Subramanian Swamy, the original complainant, has filed his written arguments as under:

A-1 was the Chief Minister of Tamilnadu from 24.6.1991 till 30.9.1996. She along with A-2 to A-3 amassed wealth disproportionate to their known sources of income. Earlier to this, she was a member of Rajya Sabha from April 1984 till 27.1.1989 till 30.1.1991. She was a public servant within the meaning of Section 2(b) of the Prevention of Corruption Act, 1988. Crime No.13/AC/96/HQ was registered for the offences punishable under Sections 13(2) and 13(1)(e) of the Prevention of Corruption Act against A-1 and others.

A-1 was the daughter of late Smt. N.R.Sandhya, who was acting in Films during 1960s. A-1 was acting in Films during 1964-1972. Smt. N.R.Sandhya died in the year 1971. As per the Will dated 1.11.1971, she bequeathed her shares in the properties belonging to Natyakala Nikethan to A-1. At the time of her mother's death, A-1 was owning the following properties.

a) Land and building at No.36, Poes Garden, Chennai-600086.

b) House at Plot No.36, Door No.8/3/1099, Srinagar Officers' Colony, Hyderabad City.

c) Lands totally measuring 10.20 acres in Survey No.52 and Sy.No.50 of Jeedi Metla Village and Sy.No.93/1 of Pet Basheerabad Village, Metchal Taluk, Ranga Reddy District, Andhra Pradesh with Grape Garden, Farm House and servants' quarters purchased in 1968 valued at Rs.1,65,058/- plus Rs.13,254.50.

The above three items were bequeathed to A-1 by her mother through Will dated 1.11.1971.

d) Land in Sy.No.93/2 to the extent of 3.15 acres in Pet Basheerabad Village, Andhra Pradesh.

Up to 1987, A-1 was in possession of properties worth about 7.5 lakhs, i.e. item Nos.(a) to (d) mentioned above, agricultural lands measuring 3.43 acres in Cheyyur Taluk, an old Ambassador and an old Contessa Car, a new Maruti Car and company shares, bank balance to the extent of Rs.1 lakh, besides jewels.

He further states that A-1 had floated business Firms, viz. M/s. Jaya Publications, Namadu MGR and M/s.Sasi Enterprises in the between 1988 to 1990 with A-2 and others as partners of these Firms. These Firms did not generate any income. From 13.5.1988 to 27.1.1989, she was a member of Parliament. A-1 has purchased four motor cars worth Rs.9,12,129/- and on 13.2.1989, she purchased a Jeep worth Rs.1,04,000/-. Check Period is from 1.7.1991 to 30.4.1996. As on 1.7.1991, A-1 was found to be in possession of properties and pecuniary resources in her name and in the name of A-2, who was living with her, to the extent of Rs.2,01,83,957/-. These include the properties acquired in the name of M/s.Jaya Publications, M/s.Sasi Enterprises and Namadu MGR. After 1.7.1991, the acquired assets by A-1 has gathered momentum and during this period, A-3 and A-4 came to live with A-1 and A-2 at No.36, Poes Garden, Chennai-86. During this period, A-1 and A-2 along with A-3 and A-4 floated 32 Partnership Firms/Companies, which are mentioned in the charge sheet. During the above period, there was no business activity in the above mentioned Firms/Companies. The activities were more in the nature of acquiring lands, machinery, buildings and vehicles which were not production-oriented. No income tax returns were filed by these Firms as expected by law. No assessment for commercial tax has also been done with respect to the businesses of these Firms. They have not filed their returns. A-1 has also not filed her income tax returns for the assessment years 1987-88 till November 1992. When this issue was raised by the complainant, A-1 filed income tax returns for the above periods in November 1992. Subsequent to 1.7.1991, assets in the forms of movable and immovable properties and pecuniary resources like bank deposits, etc. are found acquired not only in the name of A-1 but also in the names of A-2 to A-4 and the Firms floated in their names. A scrutiny of the various bank accounts maintained in the names of A-1 to A-4 and in the names of different Firms disclose that huge credits in cash and cash had been frequently made into various accounts which were not commensurate with the income of the individuals and of the Firms concerned. There were frequent transfers of amount between one account to the others to facilitate illegal acquisition of assets. The huge quantum of such assets when viewed along with the facts that A-1 was holding the office of Chief Minister and that A-2 to A-4 were living under the same roof with A-1 and not having sufficient means to acquire the assets in their names have established that the assets were actually acquired only by A-1. There was thus criminal conspiracy between A-1 and her associates, A-2 to A-4 to possess properties and pecuniary resources by A-1 in her name and in the names of A-2 to A-4 and in the names of various Firms floated by them. Further, A-2 to A-4 had pursuant to the said conspiracy held the said properties and pecuniary resources in their names and in the names of the Firms floated by them on behalf of A-1. Pursuant to the said conspiracy, the properties, expensive jewellery and pecuniary resources were acquired by A-1 in her name and in the names of A-2 to A-4 and also in the names of various Firms. As on 30.4.1996, the assets thus acquired and possessed by A-1 are found to be worth Rs.66,44,73,573/-.

He further states that in the present case, the prosecution has clearly proved beyond reasonable doubt that the accused persons possess properties disproportionate to their known sources of income. The burden is shifted to the accused to satisfactorily account for the properties acquired. The accused were unable to account for disproportionate assets even through preponderance of probabilities.

He further states that financial status of A-1 prior to her joining as Chief Minister of Tamil Nadu also has to be taken note of Ms. J. Jayalalitha, who showed 'NIL' Income and Wealth in 1985-86, she ceased to be an actress since 1979. After becoming Chief Minister, she doubled her income, tripled her wealth despite of drawing only Rs.1/- per month as salary of Chief Minister. It is obvious she is some kind of financial wizard.

He further states that A-1's Wealth in the year 1992- 93, in her returns, it is stated by her to be about Rs.6,00,00,000/- (Rupees Six Crores). This is unbelievable and represents ill-gotten wealth. Income tax authorities have sent her a notice on 14.12.1992. Notice sent was under Section 16 of the Wealth Tax Act and Section 148 of Income Tax Act.

He further states that A-1 owns 10 acres of Grape- Wine Farm land in Hyderabad. She has claimed income of about Rs.1 Lakh per acre from that Farm, after she became the Chief Minister of Tamilnadu. When her position grows, the yield also grows. There is no reason why no such abnormal and unbelievable agricultural income during the past years when she was not the Chief Minister. In fact, she was not in a position to build a Farm House with her own funds. The large scale of corruption engaged by A-1 after she becomes the Chief Minster clearly comes out when one considers her poverty status in 1986 when she had taken a loan of nearly Rs.4 lakhs from Mr.Ramaswamy Wodeyar, the Liquor Baron, on instructions from the former Chief Minister M.G.Ramachandran to build her Farm House in Hyderabad. She was a debtor in 1986. She took salary of Rs.1/-. She earned wealth in multi-crores without doing any gainful work.

He further states that after A-1 became the Chief Minister, her financial status was not sound. She had an intention of purchasing 1.1378 grounds comprised in R.S.No.1567 of 63, Plot No.31-A, Block No.31, Mylapore Division, adjacent to her house No.36, Poes Garden, but the land owner was reluctant not to sell the same. The normal market value of 1.1378 grounds in 1991 was more than Rs.45 Lakhs. But this land was purchased and registered on 26.7.1992 for Rs.8 Lakhs. Her financial position was not sound to pay the sale consideration amount by a single cheque. But she paid by three cheques, one for Rs.1 lakh, another for Rs.4 lakhs and another cheque for Rs.3 lakhs.

He further states that defence witness examined in this case have not adduced any valuable evidence to discard the prosecution evidence satisfactorily account for the possession of huge assets disproportionate to the known sources of income of A-1. The calculation adduced by the defence witness does not tally with the income shown by the prosecution for A-1 to A-4 and the Firms. The evidence of defence witnesses for giving money to the Firms are not supported by any documentary, legal evidence and cannot be accepted as a lawful source of income. Moreover, cross-examination of these witnesses have established the fact that their claims were not based on any documentary proof, but are merely oral. They have come forward at a belated stage in order to save the accused from the criminal liability.

He further states that the plea taken by the A-1 in paragraphs 15 to 18 of the grounds of the appeal that since income tax authorities had compounded the offences of A-1, failure to file income tax returns under Section 279 of the Income Tax Act and by paying the dues and penalty, A-1 had been exonerated of any amassing of wealth illegally has no relevance in these proceedings in appeal herein, since it is well settled that such compounding has no bearing on prosecution.

He further states that as per paragraph-14 of the grounds of appeal, income tax authorities had "accepted" her statement of income to be "true and genuine". This is false. Income tax authorities have not made and cannot make any admission under Section 279 or any other provisions of the Income Tax Act. Thus, A-1 and others cannot escape from the clutches of the Prevention of Corruption Act on the basis of disposal of the case on compounding of the same under the Income Tax Act and take shelter in this appeal under this guise of compounding of the offences under the Income Tax Act. The findings rendered by the Income Tax Department under Section 279 would not be binding on the trial Court or in the adjudication of this appeal. What is more serious is that the income tax compounding procedure was restricted to the recovery of the income tax due and an agreement to pay the same by A-1 willingly. It does not in any way represent legal vindication of any claims of A-1 and how the income she claimed was earned.

He further states that the money flow chart establishes that the ill-gotten money which was deposited by cash into the accounts of the accused persons and the companies floated by them was indeed used by them to purchase the properties and to acquire other assets. The matrix of arguments of A-1 and the grounds adduced are either vague or exaggerated or full of weak or bald assertion without any factual basis and stretches of credibility beyond human credulity as shown in paragraphs-116, 119 and 136 of the grounds of the appeal. Grounds urged in the Crl.A.No.835/2014 is vague, without merits and devoid of substance. Therefore, he requests to confirm the conviction and the sentence imposed by the trial Court.

The written arguments filed by the third party/intervener are as under:

Most of the witnesses upto PW.57 speak about the sale of land to various business persons and accused persons. PWs.58, 59, 60, 61, 62, 63, 64, 65, 66, 67, 68 and 69- speak about sale of various vehicles to the accused persons. PW.69-R. Rajendran is the Registrar working as RTO, Chennai and he speaks about all the registrations which had taken place. PW.71-S. Radhakrishnan is the Horticultural Officer. He speaks about purchase of lands by A3-V.N. Sudhakaran in Tirunelvleli by Riverway Agro Products and also about the service connections, etc. bought by the above A3-Mr. Sudhakaran. PW73- Murugesan, Village Administrative Officer was directed by PW.71 to give a lesser market value for the property. The lands were measured with police protection. PW76-Siva is the Real Estate agent who speaks about how A4 purchased the lands with the help of Mr. Rajagopalan, Registrar and Horticultural Officer Mr. Radhakrishnan. PW77-Janaki, Sub Registrar, speaks about the pressure bought upon her by A3 to register the property for less than the guideline value.

Evidence of PWs.83 and 84- Devarajan and Ayyadurai would clearly reveal that he was taking active part in the purchase of the vehicle for Jaya Publication which was to be used by her.

The vehicles were inspected by A1 and A2 which would show their close proximity in business transactions.

PW.94 - Lakshmi Narayana is a star witness who speaks about the registration of companies and who were also inducted as Directors in the companies. This witness clearly reveals that the accused persons were all Directors of the Companies during the check period. PW95-Balu speaks about the leasing of premises for the Lex Properties Private Limited by A3. PW.96-Anilkumar Reddy speaks about transfer of Meadow Agro Farms which again and had no business to A4. PW100-Prabas Kumar Reddy speaks about sale of his apartment for Rs.30,00,580/- to Lex Properties Pvt. Limited.

PW.107-Soman assessed Siruthavur Bungalow at Rs.5,40,52,298/-. Payanoor Bungalow at Rs.1,25,90,261/- Anjaneya Printers Namadhu MGR building at Rs.2,13,63,457/-. PW.115-Mariappan values the machineries at Anjaneya Printers and Metal King at Rs.3,05,00,088/- and Rs.7,69,000/- respectively. PW.116- Jayapaul, Executive Engineer verified the Poes Garden building and valued at Rs.7,24,98,000/-. PW117-Era Govindan, Executive Engineer valued three buildings at ECR Road at Rs.10,47,446/-, Rs.90,17,557/-, Rs.28,01,811/- and Rs.80,75,000/-. PW123- Srinivasamurthy, Sales Tax Officer deposed that from 1996 June to 1998 June, registration was done in his office for Jaya Publications having No.36, Poes Garden, Chennai as address. This is the official residence of Selvi. Jayalalitha. No returns were filed till 1998. PW125-Vasudevan, Assessing Officer values the gold and diamond jewelry at Rs.33,50,043/- marked as MOs.2 to 608. PW159- Rajagopalan, Sub Registrar of North Chennai Registration officer speaks about the registration of documents at the residence of A1 to A4 and registering the documents were done without names of the purchaser and about non- payment of stamp duty, which are abuse of power. He also speaks that the registration of properties pertaining to other Districts of Tamil Nadu, beyond his jurisdiction were registered in his office at Chennai, by abuse of power. PW.182-Arunachalam who was working as Chief Manager, Indian Bank, Regional Branch had deposed that A2 and her accessories had account in Abiramapuram Branch when he was working from December 1995. He speaks about how monies were transferred from one account to the other and went into the accounts of various companies.

PWs.185 and 186-A. Premkumar and Chalapathy Rao respectively speak about the services rendered by them for the marriage of V.N. Sudhakaran and that they received cheques signed by A1.

PW.197 - Yoganand, Accountant at Petrol Bunk, Alwarpet. He used to fill petrol for vehicles belonging to Jaya Publications, Sasi Enterprise and Namadhu MGR to the tune of Rs.10,09,419/- and he received a cheque for Rs.9,73,402/- signed by A1, A2. This will go to show that A1 took active party in Jaya Publications, Sasi Enterprises and Namadhu MGR. PW.198 - Jayaraman was a Secretary to the then Chief Minister A-1. He has deposed that Mr.Vijayan @ Rama Vijayan used to deposit the money given to them in the names of the companies mentioned by A-2 in Canara Bank, Mylapore Branch and Indian Bank, Abiramapuram Branch.

PW.201 - Vidya Sagar was the Manager of Canara Bank at Mylapore. He speaks about all the accounts held in their branch by A-1, A-2, A-3 and A-4 and other entities floated by them. PW.209 - Manickavasagam was the Branch Manager of Abhiramapuram Branch, Indian Bank. He speaks about certified copies of Exhibits.

PW.226 - N.Thiagarajan was the Tahsildar at the relevant point of time. He speaks about the application dated 6.6.1994 given by Meadow Agro Farms Private Limited for handing over of the land at Uthukottai village to the said firm. He further states that in relation to the land of 147.89 acres the value of the trees would be Rs.31,25,963/- and the land would be Rs.22,18,350/-. The report is marked as Ex.P2170 dated 22.9.1994.

PW.259 - Nallamma Naidu, Investigation Officer. He states that he prepared the statements 1 to 7 and found out that a sum of Rs.62,25,20,896/- are the assets disproportionate to the known sources of income of A-1. He further states that he gave the statement of A-1 and wanted an explanation from her. He also further states that on 30.4.1997, he applied for sanction to prosecute A- 1 to the Governor of Tamil Nadu. The final report was filed on 4.6.1997. Ex.P2320 is the investigation report on the basis of the complaint given by PW.232. He explained how he had arrived at the final figure of Rs.66,30,30,000/-.

The above mentioned are the star witnesses of the prosecution which prove beyond all reasonable doubt the guilt of A-1 to A-4 in amassing assets disproportionate to their known sources of income. Especially the witnesses PWs.182, 201 and 209 who are the bank officials clearly speak about how money was flowing from the account of A-1 and A-2 and into the account of various companies.

The accused persons set-up various defences and they can be broadly classified under the following headings:

a) Marriage Expenses was not properly computed.

b) The construction costs were overly inflated and should not be relied upon.

c) The companies have a separate existence from that of the accused and their properties should not be considered as that of the accused persons.

d) The amounts deposited into the account of Namadhu MGR was that of the proceeds of the Deposit Scheme.

e) The Income-tax returns of the accused should be relied upon and accepted by the Criminal Court.

f) There is no material for conspiracy.

An attempt has been made by the accused persons to show that they had huge income to purchase the properties, by filing inflated income tax returns belatedly and after the charge sheet was filed in the case. The Income-tax returns of the Cheque period 1991 to 1996 was filed after 1997 when the charge sheet in this case was filed. It is apparent on the face of it that the Tax returns were filed as an afterthought to account for the illegitimate assets acquired by the accused persons, hence do not fall with the explanation under Section 13(1)(e) of the P.C.Act. The third party Intervener submits that the criminal liability of the accused will not be absolved even if the Income-tax Appellate Authority accept the tax returns. The Income Tax Department is only a revenue collecting authority and not an Anti-Corruption Tribunal. The duty of any revenue collecting authority is only to scrutinize the returns and accept the tax. The Income Tax authorities do not enquire into the lawful source of the amounts disclosed and give finding regarding the commission of bribery; whereas the accused are charged for criminal liability when the lawful source of income is not disclosed as per Section 13 of the P.C.Act. The Income Tax authorities merely accepts the returns filed and collected tax irrespective of the source of income. On perusal of the entire evidence on behalf of the prosecution and the defence, it is evident that there is no plausible explanation offered by the accused for the properties acquired by them. The accused have rested their defence solely on the balance sheet and the profit and loss account statements said to have been filed before the Income Tax authorities. But, the said documents are not proved in accordance with law and they are not in compliance with the statutory requirements. The auditors examined by the accused are found to be cropped up to support the false defence set up by the accused. The auditors examined by the accused did not handle their accounts during the check period and they were not conversant with the true facts. The returns and the balance sheet and the profit and loss account were maneuvered solely with a view to offer an explanation to the huge unexplained credits entered in their respective bank accounts.

DW.1 nor the accused have named the persons who remitted the money to this account. The entries contained in Ex.D15 show that, the account was opened on 14.8.1995 by remitting cash of Rs.1,001/- and on 22.8.1995, a sum of Rs.3,40,000/-, Rs.7 Lakhs, Rs.23,35,500/-, Rs.58,80,000/-, Rs.17,80,521/- is remitted to this account and on 23.8.1995, Rs.28 Lakhs has been remitted. Even with regard to the source of the money remitted to this account, the version of DW.1 is that, it is remitted by the family members. There is no evidence as to who specifically remitted this money. It has come in evidence that the bride's father has handed over Rs.14 Lakhs to PW.200 towards the marriage expenses. If bank account was opened to meet the marriage expenses and all the arrangements were looked after by DW.1 as contended by the accused, there is no explanation as to why the father of the bride has to pay Rs.14 Lakhs to PW.200.

The evidence of DW.1 and the other witnesses examined by the accused in support of their contention that the marriage expenses were met by the bride's family is completely falsified by the declaration made by A-1 in her returns filed before the Income Tax Authorities as per Ex.P2176, wherein she has declared Rs.29,92,761/- as the amount spent by her towards the marriage. Further, if the marriage expenses were looked after by DW.1 and he was maintaining the account, there is no explanation by the accused as to how the original receipts and all other connected documents in relation to the marriage expenses were seized from the office of PW.228 under Ex.P2218. On the other hand, several witnesses examined by the accused have consistently deposed that on hearing the marriage of A-3, they approached A-1 expressing their intention to contribute their might. This evidence once again indicates that the arrangements were made and even the payments were made by A-1.

The prosecution has listed 19 new/additional construction said to have been constructed by the accused during the check period. The total value of these constructions come to Rs.18,17,40,430/-.

The accused persons miserably failed in their duty to prove the facts within their special knowledge. They instead of letting in evidence to show that the valuation and assessment of the buildings are higher, never gave what is the value of the building as per their calculations. They instead questioned the valuation of the prosecution and sought that the entire valuation has to be discarded from consideration. When the value of materials and the cost of the construction is within the special knowledge of the accused persons, it is their bounded duty to let in evidence. When they failed to in their obligation to discharge that burden the trial Court came to the conclusion in valuing the buildings. The Engineers examined by the prosecution are competent to estimate the valuation of the structures. The accused themselves have relied on the valuation report prepared by the PWD Engineers, who were part of the team to controvert the reports prepared by the prosecution witnesses. It is not explained by the accused persons as to why the reports prepared by DW78 and DW83 are preferable to the reports prepared by the entire team which are proved in a Court of Law. The actual cost incurred for the construction is within the knowledge of the accused. It is the case of the accused that contractors and architects were appointed in connection with the construction.

The third Party Intervener submits that the modus of the accused persons was to purchase defunct companies from its original owner then launder money obtained by corrupt means through these companies. For this purpose, they floated about 34 companies and opened around 100 bank accounts in the names of these companies and deposited cash into the company accounts. The documents of the companies show that these companies did not do any business except purchasing properties. At the relevant time of acquisition of the properties during the cheque period, the six companies through which most of the properties are purchased are:

1) Riverway Agro Products

2) Meadow Agro Farms Pvt. Ltd.

3) Lex Property Development Pvt. Ltd.

4) Ramraj Agro Mills Pvt.Ltd.

5) Indo-Doha Chemicals Pvt. Ltd.

6) Signora Enterprises These companies were exclusively under the control and management of A2 to A4. The registration address of most of the companies is 36, Poes Garden, Chennai. The promoters had already resigned in favour of A2 to A4. Except Indo-Doha Pharmaceuticals Company Pvt. Ltd. all other promoters and erstwhile Directors have categorically stated before the Court that, on receipt of the amount invested by them for the formation of companies, they signed the necessary forms and went out of the company and since then, they ceased of any right or interest in the said property. The promoter Directors have categorically stated before the Court that they did not purchase any properties in their names either before or after the formation of the company as long as they were on the Board of Directors. A2 to A4 took over the management of the company without even buying the requisite shares. The illegally amassed wealth running to nearly 3000 acres of land is sparked in these companies. The properties registered in the name of the companies and even dispose them of merely by passing a mere resolution. The intention of the accused in buying over the above companies and taking full control over the management thereof and thereafter acquire large number of properties in the name of the companies undoubtedly manifest the criminal motive and intention of the accused attracting the ingredients of offences under Section 13(1) (e) of the PC Act read with Section 120-B of IPC.

The evidence of PW.182-Arunachalam, PW.203- Vidyasagar and PW.209-Manickavasagam clearly would prove that the bank accounts were opened by A2 and A3 in the name of the companies only after they took over the management and control of the companies and all the transactions relating to the said companies are stated to have taken place through these accounts. The most important piece of link which connects all the accused and proves conspiracy is the fact that the funds were transferred or remitted to these above mentioned accounts either from the bank account held in the name of Namadhu MGR, Jaya Publications or other firms run by A1 and A2. The funds for the acquisition of the properties had flown from A1 either directly or through the accounts maintained in the joint names of A1 and A2.

The evidence of the erstwhile owners of these companies, would clearly reveal that no funds of the above named companies were utilized for the acquisition of the properties. It is an admitted fact that none of the companies had filed returns either before the Registrar of Companies or before the Income Tax Authorities declaring the funds for the purchase of the properties or the acquisitions alleged to have been made in the name of the companies. The money flow chart would clearly reveal that the funds from the purchase of these properties are proved to have been flown from the sources provided by A1 and all throughout the properties were treated as private properties of A3 and A4. A3 and A4 obtained loan for effecting improvements in these properties and there is nothing on record to show that the loan liability has been taken over by the above companies. It is proved beyond all reasonable doubt that these companies purchased properties only out of the funds funneled through Namadhu MGR account in which unexplained cash was deposited. The above companies were never represented by either the Secretary or Director and in any of the registered deeds. Even the addresses of the companies were never written in the body of the deed. The Registrar who registered these properties PW181 who negotiated for the purchase of the properties bent the rules only to help A1. The circumstances brought out in their evidence clearly indicate that they went out of the way to register these properties as instructed by A1 solely to oblige A1. The corporate veil of these companies, have to be pierced since they were used as front for parking illegal funds.

The deposits of huge cash clearly reveal the conspiracy of A1, A2, A3 and A4 to amass wealth through illegal means. The 3rd party Intervenor submits that the properties purchased by the accused persons, the money was paid by way of cash or from the accounts held by the accused persons. He further submits that the ill-gotten money which was deposited by cash into the accounts of the accused persons and the companies floated by them was indeed used by them to purchase the properties and acquire other assets.

Namadhu MGR deposit scheme is a bogus plea. The defence set up by the accused that Namadhu MGR newspaper floated a deposit scheme and the monies deposited there were the monies of the depositors was a false plea. The auditors examined by the accused did not handle their accounts during the check period and they were not conversant with the true facts. The returns and the balance sheet and the profit and loss account were maneuvered solely with a view to offer an explanation to the huge unexplained credits entered in their respective banks accounts. The prosecution has proved that there was no real source of income with the other accused and the public servant is expected to show the real and lawful source. There is absolutely no evidence whatsoever to show that, during the check period, either the accused or the firms run by them credited any amounts to the various accounts maintained by them. The story of the scheme deposit canvassed by the accused has taken birth only after filing of the charge sheet. There is not even a stray evidence to suggest that the said deposit scheme was in circulation any time before the registration of the criminal case against the accused. There is nothing in the entire evidence indicating that the accused had declared the said deposit before the Income Tax authorities any time during the check period. As already narrated above, the existence of the said scheme was brought to light only in the year 1998 in the returns filed on behalf of the said firms. It is only after filing of the charge sheet, the accused appear to have master minded the above defence with the active connivance of DW88, who claims to be the Chartered Accountant of the accused with a view to create evidence in a bid to offer an explanation for the huge amount of unaccounted money found with A1.

The accused have not produced any material before the Court to show that Dr. Namadhu MGR had floated the deposit scheme inviting subscription from the General Public. M/s. S. Jaya Publication was an assessee of Income Tax with Central Circle-II, Chennai from the year 1991. The trial Court by convincing reasoning based on the evidence and analysis of the documents gives a categorical finding that Namadhu MGR deposit scheme is a bogus scheme and an afterthought. The defence harped upon the fact that the transactions are all benami transactions and as per the abolition of Benami Transactions Act, no prosecution could be launched against the accused persons. The defence witnesses examined in this case have not adduced any valuable evidence to discard the prosecution nor their evidence satisfactorily account for the possession of huge assets disproportionate to the known income of A1. The calculation adduced by the defence witnesses do not tally with the income shown by the prosecution for accused Nos.1 to 4 and their respective firms.

The evidence of defence witnesses for giving money to the firms are not supported by any documentary legal evidence and cannot be accepted as a lawful source of income. Hence, he prays for confirming the sentence and fine imposed by the trial Court to convict the accused Nos.1 to 4.

The brief reply filed on behalf of the appellant to the written arguments filed by Dr. Subramanian Swamy is as under:

Allegations against the appellant are borne out in a desperate attempt to tarnish the name of A-1 without any supporting material. The provision of law mentioned is wrong. Factual mistakes have been deliberately made with a view to gain cheap publicity. This shows that if third party opponents who are nurturing a personal animosity against A-1 are permitted this solemn Court proceedings would degenerate into legalized means of wrecking personal vengeance. Namadu MGR is not a Firm. It is a Newspaper run by Jaya Publications. The averments made in paragraph-7 that A-1 as a member of Legislative Assembly acquired and possessed pecuniary resources which are not commensurate with her known sources of income is wrong. In fact, deliberately, a false case has been lodged against the accused by the then DMK Government. The case was investigated and found to be false. The case was closed and closure report was accepted by the Principal Sessions Judge, Chennai, as per Ex.D.374. The averments made in paragraph-9 of the written arguments mentioning that the appellant and A-2 have floated several Firms and listed 32 entities. This is factually wrong. It is not even the case of the prosecution that A-1 has floated these Firms or that A-1 was ever a Partner of these Firms. The assessment of the appellant either under the Income Tax Act or Wealth Tax Act were always scrutiny assessments which were duly completed and return of income as filed by the appellant has been accepted. This is the position for all the five years of check period. The allegation in paragprah-10 that there has been a huge deposit of money in the account of the Firms and the appellant cannot be justified, it only demonstrate lack of deep study of the documents filed and the explanation offered by the appellant. Appellant, Jaya Publication, Sasi Enterprises have been assessed under the Income Tax Act. Assessment Orders and the orders of CIT (Appeals), covering the entire five years of the check period have been produced and marked in evidence on behalf of the appellant. A perusal of those orders will belie the version of the complainant. That in none of the years during check period, the appellant or Jaya Publications or Sasi Enterprises have ever been made to pay tax on any unexplained income or unexplained expenditure. The allegations made in paragraph-10 are incorrect. The allegation that there was conspiracy between the appellant and A-2 to A-4 are made without any justification. Original complainant is not acquainted with the facts of the case. It is revealed from the figure shown by the complainant in paragraph-13 that the value of the alleged disproportionate assets is Rs.66,44,73,573/- whereas according to Directorate of Vigilance and Anti-Corruption Department, the value of alleged disproportionate assets is Rs.66,56,20,395/-. In paragraph-19(ii), the complainant has stated that the appellant has declared Rs.60 Crores and has wondered how the appellant could have got it. This is a deliberate false statement. These are made with an eye for sensationalism. Her agricultural income during check period has been accepted upto the Tribunal level. It is a lie and defamation to allege that the appellant had taken loan from Rs.4 Lakhs from Ramaswamy Udayar from a Liquor Barron and that too with instruction of Sri M.G.Ramachandran to build a Farm House at Hyderabad. There is no such incident. The complainant has asserted many things in a desperate attempt to somehow implicate A-1. These averments show that the complainant is trying to clutch at a straw.

The defence witnesses have given oral evidence supported by documentary evidence. Their evidence is fortified by the decisions of IT authorities upheld up to the Tribunal level in favour of the appellant.

The averments made in paragraphs-24 and 25 appear to indicate poor understanding of factual aspects. The compounding was in respect of non-filing of returns for the assessment year 1993-94. The compounding was accepted on 26.11.2014, whereas the appeal was filed in September 2014. Hence, the averments relating to compounding order of Income Tax authorities were made in appeal is a lie. The compounding was with respect to filing of returns in the year 1993-94 and on account of criminal prosecution having been lodged against the appellant. In view of the compounding, the prosecution laid against the appellant by the Income Tax department for non-filing of return was withdrawn and the same was dismissed in favour of the appellant. It is incomprehensible as to how this has any relevance to the issue involved in the present case.

The averments made in paragraph-25 that the appellant has stated in memorandum of appeal that I.T. authorities as "true and genuine" and it is on account of the compounding. The same is wrong. The facts stated above make it clear that the income and expenditure were independently determined and it is not on account of compounding under Income Tax Act. The appellant has not in any manner relied upon the acceptance of the compounding application. Hence the allegation of complainant in this regard is a factual misstatement. The written arguments filed by the complainant is riddled with factual misstatements made deliberately. It does not add anything to aid this Court in deciding this appeal.

In the case of ANBAZHAGAN V/S. STATE OF KARNATAKA in Crl.A.No.637/2015, the Hon'ble Supreme Court of India has observed at paragraph No.36 as under:

"36. We have referred to the aforesaid two authorities only to highlight the gravity of the offence. We are absolutely sure that the learned Single Judge, as the appellate Judge, shall keep in mind the real functioning of an appellate court. The appellate court has a duty to make a complete and comprehensive appreciation of all vital features of the case.

The evidence brought on record in entirety has to be scrutinized with care and caution. It is the duty of the Judge to see that justice is appropriately administered, for that is the paramount consideration of a Judge. The said responsibility cannot be abdicated or abandoned or ostracized, even remotely, solely because there might not have been proper assistance by the counsel appearing for the parties. The appellate court is required to weigh the materials, ascribe concrete reasons and the filament of reasoning must logically flow from the requisite analysis of the material on record. The approach cannot be cryptic. It cannot be perverse. The duty of the Judge is to consider the evidence objectively and dispassionately. The reasonings in appeal are to be well deliberated. They are to be resolutely expressed. An objective judgment of the evidence reflects the greatness of mind

- sans passion and sans prejudice. The reflective attitude of the Judge must be demonstrable from the judgment itself. A judge must avoid all kind of weakness and vacillation. That is the sole test. That is the litmus test. This being the position of a Judge, which is more elevated as the appellate Judge, we are of the considered opinion that there is no justification for rehearing of the appeal as the matter has been heard at length and reserved for verdict. The appellant has submitted his written note of submissions before the trial court and, therefore, we are inclined to permit him to file a written note of submissions within 90 pages before the learned Single Judge/Appellate Judge. The State of Karnataka, which is the prosecuting agency, is granted permission to file written note of submissions within 50 pages. The written submissions be filed latest by 28.4.2015. The written note of submissions filed before the trial court and the High Court along with written note of submissions of State of Karnataka shall be considered by the learned Single Judge and the consideration should be manifest in the judgment. Written note of submissions, if any, by the 4th respondent shall not be considered by the learned Judge. A copy of our judgment be sent by the Registry of this Court in course of the day to the Registrar General of the High Court of Karnataka so that he can place the judgment before the learned Single Judge for perusal and guidance."

There is no dispute with regard to the proposition of law laid-down in the above mentioned decisions.

10. After hearing the learned counsel for the appellants, learned counsel for the respondents and also after considering the written submissions of Sri.B.V.Acharya, Special Public Prosecutor, Dr.Subramanian Swamy, K.Anbazhagan, the following points arise for my consideration: [1] Whether the appellants - Accused Nos. 1 to 4 are guilty of offence with which they were charged and convicted?

[2] Whether the Accused Nos. 2 to 4 were parties to criminal conspiracy with the object of possessing assets and resources of income in the name of Accused No.1 and in the name of Accused Nos. 2 to 4 and 32 business enterprises floated in the names abetted with Accused No.1 for acquiring the properties?

[3] Whether the confiscation of immovable properties and auctioning the gold and diamond ornaments to make deficit of fine amount good and remaining gold and diamond jewellery to be confiscated to the Government is sustainable in law or not?

11. My answers to the above points are as under for the following reasons:

Litigation made by persons who advance the political gain and to settle the scores under the guise to fight a legal battle should not be entertained. Liberty of the accused cannot be taken away except in accordance with established procedure of law, under the Constitution, criminal procedure and other cognate statutes. Fair investigation requires that accused should not be kept in darkness. Investigating officer must give an opportunity to the accused, call upon him to account for the excess of the accounts over the known sources of income. The choice of check period must be necessarily be determined by the allegations of facts on which the prosecution if founded and rests. The period must be such as to yield true and comprehensive source of income and the pecuniary resources and property in question of the public servant, either by himself or through any other person on his behalf which are alleged to be not disproportionate. It is for the prosecution to choose the period, having regard to the acquisitive activities of the public servant in amassing wealth, characterize and isolate that period for a special scrutiny.

The Government of Andhra Pradesh issued Memo No.700/SC D/88-4 dated 13.2.1989 for the benefit of the Government servant giving certain guidelines to the Anti Corruption Bureau is entitled to give allowance of a reasonable margin of 20% on the total income of a Government servant while computing disproportionate assets. On the basis of this memorandum of the State Government the High Court of Andhra Pradesh rendered in S.Thiremolaiah v. State of A.P. Inspector of Police II A.C.B., Karnool Range, Karnool, in which the learned Judge has given the benefit of this Government Memo to the appellant therein though the appellant in that case was prosecuted in the year 1983, that is 6 years before the issue of this Memo as in the case on hand.

In Agnihotri's case, the Apex Court held since the excess asset was comparatively small, being less than 10% of the total income of Rs.1,27,715.43/-, it would not be right to hold that the asset found in the possession of the accused were disproportionate to his known source of income so as to justify the raising of presumption under Section 5(3) of the Prevention of Corruption Act. Proof of unexplained possession of resources or property disproportionate to known source of income, a presumption of misconduct was made against the accused. The reasons being that if the percentage begins to raise in each case, it gets extended till it reaches the level of incredulity to give benefit of doubt. Proof of unexplained possession of resources or property disproportionate to known source, a presumption of misconduct was made against the accused. Sub-Section 5 based on a rule of evidence enabling a Court to raise a presumption of guilt in circumstances a rule which is a complete departure from the established principles of criminal jurisprudence that the burden always lies on the prosecution to prove all the ingredients of the offence charged and that the burden never shifts on the accused to disprove the charges framed against him (G.V.NAIR V/S. GOVERNMENT OF INDIA - 1963(1)Crl.L.J. 675 Kerala). It is clear therefore where a person is charged with criminal misconduct and it is seen that he is in possession of property or income which could not have been amassed or earned by the official remuneration which he has obtained, then the Court is entitled to come to the conclusion that the amassing of such wealth was due to bribery or corruption.

Charge ought to disclose under which of the different clauses of Sub-Section (1) the offence of criminal misconduct has been committed.

The Benami Transactions (Prohibition) Act and Prevention of Corruption Act operate in different fields. The source of income of a particular individual will depend upon his position in life with reference to particular occupation or avocation in view. Known source of income means known source of income to the prosecution after a thorough investigation and the onus of satisfactorily accounting for it is not as heavy. An onus is on the prosecution to prove its case beyond all possibility of doubt. (HEMANTA KUMAR MOHANTY V/S. STATE OF ORISSA, 1973(1) SLR 1121).

Income is the receipt in the hand of the recipient. It is because of one's labour or expertise or property or investment. Windfall, gains of grafts, crime or immoral accretion will not come under the purview of known source of income.

The prosecution cannot be absolved of its liability on the ground that it was not aware of the said income on the facts and circumstances of the case. The Government servant is to satisfactorily account for the disproportionate assets and not to prove his claim with mathematical exactitude (accuracy) beyond all possibility of doubt. One in many might be keeping accounts of expenditure for his satisfaction, but why should he procure and preserve supporting bills and vouchers? These are not government cash to be audited. Besides why should one keep them from the beginning of his career till his superannuation anticipating, to be required in a Court of Law? Even for certain expenditure supporting vouchers are not feasible for which audit accepts a flat rate. (HEMANTA KUMAR MOHANTY V/S. STATE OF ORISSA, 1973(1) SLR 1121).

Fanciful claims, unreasonable apprehensions, vague possibilities cannot be hiding ground for accused persons. He is bound to answer where there is no clear tendency to criminate. (NANDINI SATPATHY V/S. P.L.DANI - AIR 1978 SC 1025) The provision contained in Section 5(1)(e) is a self- contained provision. First part of the Section cast a burden on the prosecution and the second on the accused. The accused is not bound to prove his innocence beyond all reasonable doubt. All that he needs to do is to bring out a preponderance of probability. (1981 Crl.L.J. 884) The accused lead overwhelming evidence and documents to show the affluence and substantial means of his father-in-law to create a doubt as to his possession over such property. The accused would be entitled to acquittal (Vasudevo Ramachandra Kaidalawar - 1981 CRl.L.J. 884).

A Police Officer with whom an investigation of an offence under Section 5(1)(e) of the Act is entrusted should not proceed with a pre-conceived idea of guilt of that person indicted with such offence and subject him to any harassment and victimisation, because in case the allegations of illegal accumulation of wealth are found during the course of investigation as baseless, the harm done not only to that person but also to the office he held will be incalculable and inestimable (STATE OF HARYANA V/S. BHAJAN LAL - AIR 1992 SC 604).

The huge expenditure in marriages of daughters is not explained and that there is no proper explanation given for the property in the name of his wife. (Bharath Chandra Roun - 1995 Crl.L.J. 2417 Orissa).

The investigating officer does not disclose any serious effort for ascertaining approximate if not true income from the Agriculture. The agricultural income shown in an income tax return cannot be considered as a basis for ascertaining income from agricultural lands.

In the absence of any evidence as to the date or the period of acquisition of such assets (gold), the question is what would be the date or period, which could be ascribed for the acquisition of those assets. It is a complex question, which is not easy to answer. But at any time the assumption that they were acquired on the date of check period does not appear justified.

In a case of disproportionate assets, a person employed in Textile Corporation of India was convicted. In appeal, the High Court observed that loan taken by the accused was not added to income and that statement of account prepared by the concerned authority did not contain all income particulars including the amounts drawn from the firm of his wife and held that the accused is entitled to benefit of doubt. (RAMESH CHANDER ABBI V/S. STATE OF MAHARASHTRA, (2006(3) AIR BOM R

577). From this it is clear that, loan has to be added as an income in the Statement of Account of the accused.

(emphasis supplied) It is well settled that the burden of showing that a particular transaction is benami and the owner is not the real owner always rests on the person asserting it to be so and this burden has to be strictly discharged by adducing legal evidence of a definite character which would either directly prove the fact of benami or establish circumstances unerringly and reasonably raising an inference of that fact. The essence of benami is the intention of the parties and not unoften, such intention is shrouded in a thick veil, which cannot be easily pierced through. But such difficulties do not relieve the person asserting the transaction to be benami of the serious onus that rests on him nor justify the acceptance of mere conjectures or surmises as a substitute for proof. This evidence, the learned Judge has rejected on imaginary and flimsy ground.

It was for the prosecution to prove beyond reasonable doubt and by means of legal evidence that these were Benami properties of accused No.1. Accused No.4 had no personal source of income. Accused No.4 was the nephew of the Appellant and, therefore, out of love and affection he had gifted the properties to Accused Nos.2 and 3. It was for the prosecution to establish by legal and cogent evidence that the gifts were not genuine and that they were not the properties of Accused Nos.2 and 3.

Taking in view of the testimony of all the witnesses, the burden of proving that the gold ornaments belongs to the appellant and not to Satpal Kaur was on the prosecution and no material was brought on record by the prosecution to discharge this burden.

SURYA SANKARAM KARRI V/S. STATE INSPECTOR OF POLICE, SPE/CBI/VISAKAPATNAM - 2004 (1) ALT (Crl) 357 (AP).

BHIM SINGH V/S. THAKUR KAN SINGH, AIR 1980 SC 727.

i) The burden of showing that a transfer is a benami transaction lies on the person who asserts that it is such a transaction.

ii) If it is proved that the purchase money came from a person other than the person in whose favour the property is transferred, the purchase is prima facie assumed to be for the benefit of the person who supplied the purchase money unless there is evidence to the contrary.

iii) The true character of the transaction is governed by the intention of the person who has contributed the purchase money.

iv) The question as to what his intention was has to be decided on the basis of surrounding circumstances, the relationship of the parties, the motives governing their action in bringing about the transaction and their subsequent conduct, etc. Merely because the ostensible owner of assets, do not have any known sources of income it cannot be taken as a conclusive circumstance to hold that those assets were held for the benefit of the accused. K.GOVARDHAN V/S. STATE 2001(1) ALT (CRL) 468 (AP).

The legislature has not chosen to indicate what proportion of the income would be considered disproportionate and the court may take a liberal view of the excess of the assets over the receipts of known sources of income. (Hemant Kumar Mohanty v/s. State of Orissa - 1973 (1) SLR 1121) The assets which were valued in the earlier investigation proceeding at a particular value, cannot be valued higher in the present proceeding unless any positive ground is there for such valuation. K.GOVARDHAN V/S. STATE 2001(1) ALT (Crl) 468 (AP).

SURYA SANKARAM KARRI V/S. STATE INSPECTOR OF POLICE, SPE/CBI/Visakapatnam - 2004 (1) ALT (Crl) 357 (AP).

Language of Section 106 and particularly the word 'especially' used therein connotes that the facts must be in their nature be such as could be within the knowledge of the Accused and possibly no one else. Section 106 cannot come into play where the facts concerned are such as capable of being known by others. If it were possible by due diligence and proper investigation to find out the facts even though it may be very difficult to do so, it cannot relieve the prosecution from obligation of establishing the ingredients of the offence alleged. This section cannot be used to shift the onus of establishing an essential ingredient of the offence on Accused. General burden of proof of guilt which lies on the prosecution or on authority in the position of prosecution never shifts - Prosecution cannot rely on section 106 except in very exceptional cases and to a very limited extent. Section 106 cannot be pressed into service to relieve the prosecution of its burden of proving the criminal charge though the burden of proving a plea specifically set up by an Accused, which may absolve him from criminal liability, certainly lies upon him, but the quantum of evidence by which he may succeed in discharging his burden of creating a reasonable belief, that circumstance absolving him from criminal liability may have existed, is lower than the burden resting upon the prosecution to establish guilt of the Accused beyond reasonable doubt. Standard of such proof is not akin to that of the prosecution to prove the guilt of the Accused. It is trite law that such burden can be discharged by the Accused showing a preponderance of probabilities. Prosecution must establish all elements of the offence. Positive facts must be proved by prosecution. Section 106 cannot be invoked to make good the lacuna in proving essential facts and more emphatically for establishing the facts necessary to give jurisdiction to the court. Ordinarily, there is very little scope for the application of section 106, Indian Evidence Act, to criminal cases where onus of proof is always on the prosecution and the section cannot be invoked to shift the onus on the Accused. The prosecution has to establish prima facie case in the first instance, it is not enough to establish the facts which give rise to suspicion and then by reason of section 106 to throw the onus on the Accused to prove his innocence. The absence of explanation or false explanation is no doubt a circumstance that is sometimes relied upon to bring home the guilt to the Accused in a case depending on the circumstantial evidence, on the ground that the facts proving his innocence must be within his special knowledge and that the burden of at least offering a reasonable explanation is on him on the principle of section 106, Evidence Act. But this would be so only in cases where other circumstances proved are so sufficiently strong against him as to point to him as very probably the culprit and therefore, calling for his explanation. If such a situation the Accused gives an explanation which may be reasonably true in the proved circumstances, the Accused gets the benefit of doubt though he may not prove the truth of the explanation. But, to infer the guilt of the Accused from the absence of reasonable explanation [or a false explanation] where other circumstances are not by themselves enough to call for his explanation, would be to relieve the prosecution of its burden. Section 106 does not cast any burden on the Accused person to prove that no crime was committed by proving the facts specially lying within his knowledge. The section does not warrant a direction that, if anything is unexplained which the Jury think the Accused could explain, they not only may, but must find him guilty. If the knowledge of certain facts is as much available to the prosecution on exercise of due diligence as to the Accused, the facts cannot be said to be within the knowledge of the Accused. Section 106 is intended to meet certain exceptional cases in which it would be impossible or extremely difficult for the prosecution to prove the facts which is especially within the knowledge of the Accused and knowledge of that fact is not available to the prosecution. However, section 106 cannot be utilized to cast the burden on the Accused to prove his innocence to relieve the prosecution of its burden of proof. It is only in cases where the facts proved by the evidence give rise to a reasonable inference of guilt unless the same is rebutted such inference can be negatived by proof of some facts which in its nature can only be within the special knowledge of the Accused. Section 106 is designed to meet certain exceptional cases in which it would be impossible or at any rate proportionately difficult for the prosecution to establish the facts which are especially within the knowledge of the Accused and which he could prove without difficulty or inconvenience. Where the prosecution fail to discharge the burden that the offence was committed by the Accused and it sought to rely on the fact that the Accused gave false information to witnesses regarding cause of death, held the false information given by the Accused would have effect of being simply taken in aid or to lend assurance to the prosecution story and could never form basis for drawing an inference that Accused and Accused alone were guilty of the offence. [1992 Crl. LJ 1339].

Where the Accused, a public servant, is found to be in possession of disproportionate assets, the burden is on him to satisfactorily account for his possession of such assets. However, the Accused is not bound to prove his innocence beyond all reasonable doubt. All that he needs to do so, is to bring out a preponderance of probabilities [AIR 1981 SC 1186 = 1981 [3] SCC 199].

Juristic persons are not exception - it is within special knowledge of the Corporation which of its officer acted in fraudulent manner.

Though in corruption cases, the burden of accounting for the assets disproportionate to his income does shift to the Accused and he is required to lead evidence and produce material to satisfy the court, but even in such cases the presumption of innocence does not disappear nor does the basic principle of criminal law that if a plausible explanation is put forward by the Accused which fits in within the facts and circumstances of the case that the court is duty bound to accept the explanation. [1993 Crl. LJ 2051 [BOM]] The degree and character of proof which the Accused is required to adduce for rebutting the presumption under section 4[1] of the Prevention of Corruption Act, 1947, cannot be equated with the burden resting on the prosecution to prove its case beyond reasonable doubt, a near plausibility of his explanation under section 342 of the Criminal Procedure Code, 1898 may not be enough but the presumption may be discharged if the material on record renders the fact presumed to be improbable, the Accused may do so by mere preponderance of probability in his favour and not by evidence beyond reasonable doubt besides if the story set up by the prosecution is inconsistent with the fact presumed. The presumption would be rendered sterile ab initio if not rejected out of judicial courtesy as still born. [AIR 1977 SC 666 = 1975 [4] SCC 761].

The burden to prove requisite to raise a presumption under section 5[3] of the Prevention of Corruption Act, 1947, lies on the prosecution that he money standing in the name of his wife in a bank is a benami asset of the Accused. [AIR 1977 SC 796].

Once a requisite proof to convict a public servant for having committed criminal misconduct under section 5[2] read with section 5[1][e] of Prevention of Corruption Act has to be placed on record, held, the burden to account for disproportionate assets possessed by him shifts on to the Accused. However, he need not prove it beyond reasonable doubt. He has only to establish his defence by preponderance of probabilities. [AIR 1981 SC 1186].

There has been a legal evidence for hearing a finding of fact. At least the witness must say that he has personal knowledge about the facts about which he is giving evidence. If the witness has no personal knowledge or any means of such knowledge about the facts deposed by him, his testimony would not be evidence under any principle of law. [1969 [71] PUNJAB LAW REPORTS 68].

The evidence of the contents contained in the document is hearsay evidence unless the writer thereof is examined before the court. An attempt to prove the contents of the documents by providing the signature or the handwriting of the author thereof is set at naught is a well recognized rule that hearsay evidence cannot be admitted. [AIR 1957 SC 857].

Even if the entire documents is held formally proved that does not amount to proof of contents of the document. The only person competent to give evidence on the truthfulness of the document is the writer thereon. [AIR 1968 BOM 112].

It is only when a witness states that the content of a document written in his presence by a person, then it can be said that the said witness has proved writing of that person. [1982 CRL. LAW REPORTS 39 MAHARASHTRA].

Balance sheets relating to accounts do not prove themselves and the facts mentioned therein has to be proved by evidence given on affidavit or otherwise and after giving an opportunity to the opposite party to contest the correctness of such evidence by cross examination. [ILR 1963 [2] PUNJAB 28].

Disproportionate means out of proportion, lack of proportion or equality relatingly too large or small; lack of balance or equality; failure to be in proportion unreasonably large or small in comparison with something else;

Illegal : According to Section 43 of the Indian Penal Code, the word "illegal" is applicable to everything which is an offence or which is prohibited by law, or which furnishes ground for a civil action; and a person is said to be "legally bound to do" whatever it is illegal in him to omit.

Agreement: According to Section 120(B) of the Indian Penal Code, an agreement is an advanced step from mere intention. It has to be judged from the circumstances of each individual case.

It is a matter of inference from the conduct of the accused.

The possession of pecuniary resources or property disproportionate to his known source of income is included in Clause 1(e) of Section 13 of the Prevention of Corruption Act, 1988.

Pecuniary means monetary, financial. New Dictionary of Civil Engineering, Penguin Reference:

Construction Cost: The direct contractor costs of labour, material, equipment and services, contractor's overhead and profit. Construction cost may not include the fees paid to the architect and engineer and other consultants, the cost of the land, rights of way, financing cost or other costs which are defined in the contract documents as being the responsibility of the owner or client. Soft Costs: These are cost items added to the direct construction cost - they include architectural and engineering fees, legal permits and fees, financing fees, construction interest and operating expenses, leasing and real estate commissions, advertising and promotion, and supervision costs.

Square Feet includes rate of Earth work, masoning labour work, plinth, concrete, RCC Sajjas, Hattas, wood works, plastering, flooring, cooking platform, water supply, sanitary, electrical work, painting and distemper work, painting for all wood work, cost of plinth area. Extra work will have to be borne by the owner i.e. electricity deposits, sanitary, water connection deposits etc. Extra work normally involves earth work, parking staircase, grill work.

Cladding of tiles normally contractor will charge the rates for tiles. Difference has to be borne by the owner in case laying of marbles and granites and also labour costs.

No prudent man will pay the cost of PWD rates for construction. PWD rates include delay in payment, miscellaneous expenditure of the contractor and also interest on the borrowed amount if any by the contractor. Therefore, PWD rate will normally higher than the rate that will be done by the contractor. In the instant case, valuation is done as per PWD rates.

160th Year of Publication - Wharton's Law Lexicon (Fifteenth Edition) (Page No.971):

- Lawful: The natural meaning in a statute of the words 'it shall be lawful' is permissive only, but if the words are used to effectuate a legal right, they are compulsory;

- Lawful, Legal

- What is legal is lawful. But what is lawful may be so without being formally legal.

- former contemplates the substance of law.

- which is not stricto legalo may yet be lawful. It should not be forbidden by law. In fact legal is associated with provisions in the act, rules etc, whereas lawful visualizes all that is not illegal against law or even permissible. Lawful is wider in connotation than legal. Black's Law Dictionary (Eighth Edition) by Bryan A. Garner (Page Nos.885 and 902):

Lawful: Legal; warranted or authorized by the law; having the qualifications prescribed by law; not contrary to nor forbidden by the law; not illegal.

Lawful: Not contrary to law; permitted by law Oxford Dictionary:

Lawful: According or not contrary to law, permitted by law.

O.Hood Phillips' Constitution and Administrative Law (Sixth Edition) by O.Hood Phillips Paul Jackson - Sweet & Maxwell (Page No.238):

Corruption by members. The Prevention of Corruption Acts 1889-1916 does not apply to members of Parliament in their capacity as such. Although any action of a member that is not a proceeding in Parliament is subject to the ordinary law, it is doubtful whether a back-bench M.P. (as opposed to a Minister of the Crown) can be guilty of an offence under these Acts as he has no "employer or superior officer"; but there may be common law offences in the giving and taking of financial inducements by persons exercising public functions or occupying positions of trust. The Royal Commission on Standards of Conduct in Public Life recommended that Parliament should consider bringing corruption, bribery and attempted bribery of a member acting in his parliamentary capacity within the ambit of the criminal law.

"Interpretation of Known Sources of Income in Prevention of Corruption Act, 1988" - by Ashok Dhamija - Appendix 18 - Articles relating to Corruption (Page No.1977) Account for Political Corruption - by Ashok Dhamija:

Corruptionby politicians holding high posts such as ministers, MPs, MLAs is a common knowledge, figuring in media and other fora on regular basis. Several cases relating to corruption or possession of disproportionate assets have been registered recently against politicians holding high posts. Who has not heard of Hawala and Bofors today? Even a former Prime Minister is involved in a case of corruption of offering bribes to some MPs. Cases of disproportionate assets have been registered against former Chief Ministers of Tamil Nadu, Sikkim, Himachal Pradesh, Bihar etc. The list is unending. And yet, there definitely are innumerable other cases of corruption by politicians which could never see the light of the day.

MPs and MLAs have now been confirmed to be public servants in the recent judgment of the Supreme Court in the Jharkhand Mukti Morcha case, implying that they are amenable to the offences defined in the Prevention of Corruption Act, 1988.

One major offence defined in this Act relates to the possession of assets by a public servant which are disproportionate to his known sources of income. This generally results from the acceptance of bribes over a long period of time as such bribes ultimately get reflected in his assets in one way or the other. With the sources of income remaining constant, such extra assets amount to disproportionate assets vis-à-vis his known sources of income. For a source of income of a public servant to qualify as a known source of income, the Act requires following two conditions to be satisfied: • The income is received from any lawful source; • Such receipt of income has been intimated in accordance with the provisions of any law, rules or order which are applicable to the public servant. Thus, any income received from any unlawful source, e.g., bribery, smuggling cannot be considered. Secondly, if the provisions of any law, rules or order require the intimation of receipt of any income by a public servant to any authority, then it should have been properly intimated. For example, the receipt of an income may be required to be intimated in the Income Tax Return. If such intimation is not given, then such income cannot be considered. An income which thus does not fulfill either of these conditions cannot be considered for the purposes of deciding the offence of disproportionate assets.

The importance of this provision lies in the fact that for most public servants, in addition to the requirements under laws such as Income Tax Act, there are various rules requiring intimations about their financial transactions to be given to authorities from time to time. For example, the All India Services (Conduct) Rules require the IAS and IPS officers to file a return at the time of their first appointment about all their assets and liabilities. Subsequently, they are required to submit a return every year showing details of their immovable properties. They are also required to give advance intimation about every transaction in respect of an immovable property. Even transactions in movable properties beyond a specific value, information about loans taken, or any family member joining any private trade, business or profession have to be intimated. This list is only illustrative. These requirements are more strict when the transaction or dealing in question is with a person who has any official dealings with such officer. Similar rules normally exist for other public servants.

All monetary transactions of a public servant are thus kept under watch since his appointment. A major advantage of such rules is that if a public servant has acquired any assets in a surreptitious manner without intimating to his superiors even though required under the rules, then any income generated from such property will not be considered in his favour in view of the aforesaid definition of the known sources of income requiring intimation thereof. It thus helps immensely in successfully making out a case of disproportionate assets. The requirement of timely intimations about the financial transactions debars a public servant from claiming any new or undisclosed source of income at a subsequent stage of investigation or trial of a case of disproportionate assets.

It is ironical that no such rules exist for ministers, MPs, MLAs or other elected representatives who are public servants now, when almost all other categories of public servants are subject to such rules. There have been some voluntary efforts by some politicians in this direction, e.g., the present Prime Minister asking all ministers and Member of Parliament of his party to file statements of assets owned by them and their spouses. However, such efforts are not sufficient for the simple reason that they are voluntary, individual, unorganized and scattered and are not binding. There is no legal sanction behind them and no penalty or disadvantage in the case of default. No machinery exists to ensure compliance with them. More often than not, such efforts remain only on paper and are basically meant for the public consumption in the nature of a public relations or image-boosting exercise. They are more in the form of noble declarations made at the solemn occasion of a party coming into power and to be conveniently forgotten subsequently.

It is not a mockery that politicians, who never tire of making laws and rules for others, are not governed by any such rules in the important matter of corruption. They continue to occupy high public offices where scope for corruption is definitely higher than any other category of public servants, without being governed by any such rules, while almost all other public servants are governed by such rules framed by the same very politicians in the same very matter.

In view of the impending elections to the Parliament and several State Legislative Assemblies when several politicians will be becoming public servants as MPs, MLAs or ministers, it is high time that detailed rules are framed with sufficient legal sanction, either in the form of some enactment or some rules under the authority of a valid law such as Representation of People Act, to ensure that all ministers, MPs, MLAs, other elected representatives and other private persons holding posts under statutory bodies, public sector undertakings and the like must comply with the following requirements:

• File a statement of all properties, assets, liabilities and sources of income in their own names and in the names of their family members at the time of their appointment or election to such posts;

• File regular annual returns during the period of office in respect of any changes during the year in respect of the aforesaid items;

• Report about big financial transactions (say above Rs.1,00,000) within a month to the authority to be prescribed in each category of such persons.

• Report about any monetary dealings above a particular limit to be prescribed with persons with whom they have official dealings.

• Report about the employment of any near relative under any person or company with whom they have official dealings.

• Detailed mechanism needs to be worked out to ensure compliance with such requirements with provisions for punitive action in case of non-compliance.

It may be agreed that such requirements will place unnecessary fetters or cause unnecessary inconvenience to politicians as many of them are businessmen or professionals, already having huge assets or sources of income and that such detailed reporting may not be practicable. Nevertheless, people of this country do deserve to know about the assets of those who have themselves chosen to be in public life and who would be governing them. Those who chose to be in public service owe at least this much to the people of this country. Transparency about the assets of those holding high public offices may be useful at least for forming public opinion, if not for the proof of cases of disproportionate assets against the erring ones. And, who knows, it may go a long way in curbing corruption in public life whose tentacles are all pervasive in all walks of life in the country today. • The All India Services (Conduct) Rule 1968 (Page No.186):

10. Subscriptions.-No member of the Service shall, except with the previous sanction of the Government or of such authority as may be empowered by it in his behalf ask for, or accept, contributions to or otherwise associate himself with the raising of any fund or other collections in cash or in kind in pursuance of any object whatsoever.

11. Gifts 11(1) A member of the service may accept gifts from his near relatives or from his personal friends having no official dealings with them, on occasions such as wedding, anniversaries, funerals and religious functions when the making of gifts is in conformity with the prevailing religious and social practice, but he shall make a report to the Government if the value of such gift exceeds Rs.5,000/-.

Page No.237: GOVERNMENT OF INDIA'S DECISIONS UNDER RULE 11:

1. The criteria to decide acceptance of gift my a moS or his members of the family is whether it is inspired by his official position: - The main criteria to be followed in deciding whether a member of the Service or a member of his family, should be permitted to retain a gift would be whether it has been inspired by his official position and also whether it is likely to embarrass or influence him, either immediately or prospectively in the discharge of his official duties.

Page No.252:

2.1 Since the amount received, by a subscriber from the chit fund by bid would be more than the amount subscribed by him and the difference will have to be made good by him by future subscriptions upto the total period of the chit fund, the amount received in such case would amount to loan received from the chit fund company. Since the chit fund company is not a banking company and the provisions of the Banking Regulations Act 1949 are not therefore, applicable to such companies, a member of the Service has to obtain permission of the Government under proviso to sub-rule(4) of rule 16 of the All India Services (Conduct) Rule, 1968 for receiving the money from the chit fund companies in such cases. As regards (ii) if the amount received from the chit fund exceeds Rs.2,000 a member of the Service has to report to the Government under sub-rule (4) of the rule 16 ibid because the amount received by him would not be exclusively the amount subscribed by him but would also include the commission payable by the chit fund company.

3. As regards (b), a member of the Service need not obtain prior permission of the Government for taking a life insurance policy. He will have, however, to submit a report to the Government as laid down below:

(i) A member of the Service should submit a report to the Government while taking an insurance policy if the annual premium of it exceeds Rs.15,000/-. However, if the annual premium first determined is less than Rs.15,000/- but on conversion, it exceeds Rs.15,000/- a report to the Government is necessary at the stage. When he receives the sum assured as survival benefit/on maturity of the policy he need not submit any report to the Government.

(ii) A member of the Service need not report to the Government while taking an insurance policy annual premium of which is less than Rs.2,000/-. He should however, submit a report to the Government as the time of receiving the sum assured as survival benefit/on maturity of the policy.

4. As regards (c) while fixed deposits in a bank or deposits in a Savings Bank account made by a member of the service from out of his salary or accumulated savings would not come within the scope of sub-rule(2), it would be necessary for the member of the service to report to the Government all purchase of Postal or National Savings Certificates exceeding 15 Rs.2,000 in value, from such accumulated Savings.

Service Law Dictionary (Page No.24):

Annual return of immovable property. An information regarding the immovable property owned or held on lease by an employee in his own name or in the name of anyone else, as on the last day of the period to which the return relates. Such a return is generally prescribed in respect of the public servants who are high up in the hierarchy or where the nature of their duties thrown chances of corruption. The purpose is to keep in touch with the financial status of the employee and also to ensure a check on corruption. The accumulation of assets disproportionate to one's known source of income is an offence of criminal misconduct under Sec.13(1)(e) of the Prevention of Corruption Act, 1988, punishable under Sec.13(2).

The Central Civil Services (Conduct) Rules, 1964 prescribe such returns for Group 'A' and 'B' officers in general [Rule 18(1)(ii)]. In addition, the Government has reserved its right to call for a special return in respect of both movable and immovable property from any Government servant whenever they consider it appropriate [Rule 18(4)].

THE Prevention of Corruption Act, 1988 - BY MALIK'S COMMENTARY (page No.480, Section 13) In State of Maharashtra v. Ishwar, A.I.R.1996 SC 722, the Court was concerned with the question as to when opportunity of satisfactory account should be given to the accused. The Supreme Court said that this opportunity of satisfactorily explaining about his assets and resources is before the Court when the trial commenced and not at earlier stage. The Court said the finding that principle of natural justice had been violated as no opportunity was given before the registration of the case, would be unwarranted. This was a case arising under Sec.5(1)(e) of the Prevention of Corruption Act, 1947. The present provision of Sec.13(1)(e) of the new Act is parallel to the provisions. These observations of the Supreme Court go against the contention of the counsel for the petitioner that there should be investigative trial by the investigating officer. In this context, it is significant to note that the words in clause (e) of Section 13(1) of the Act "if he or any person on his behalf is in possession or has" clearly suggest that if any person is in possession of assets or pecuniary resources on behalf of the public servant, that would be included in his assets, in the sense that he would have to account for these assets also. In this context the prosecution could prove that what is being held by another person is in fact being held on behalf of public servant i.e. he is the real source of that financial or pecuniary acquisition by the other persons. Mere declaration in income tax return of the other person when the income tax officer does not challenge the source of pecuniary resources could itself hardly provide a defence, at least the prosecution is free to prove that these resources were held for the accused and he was the real source of acquisition of those assets. The prosecution cannot be debarred from proving those facts merely on the ground that the other persons declared those assets in his income tax returns. There is no such interpretation of the law. VALUATION OF BUILDINGS:

The Learned Senior Counsel for the Appellant submits that the valuation made by the Engineers of the PWD Department is highly inflated. The rate of OTIS Lift was checked in the spencers. He further submits that the cost of the marbles and granites are assessed at a very exorbitant value. The Engineers of the PWD, Government of TamilNadu have not taken the sample marble and granites and called for tenders as to what as the rate of those marble/granites. Even the Forest Officers have not been examined to evaluate the cost of the wood. Nobody has certified that the wood used is a high quality teak wood. He further submits that the trial court has simply reduced the cost of construction to the extent of 20%. This is based on guess work. He relies on Ex.D210. Ex.D210 reads as under:

GOVERNMENT OF INDIA THE DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE-II(2) 108, Mahatma Gandhi Road, Chennai-600034 GIR No.701/95-96 & 96-97 :044-8268610/828201 extension 7025 Dated 10th December 1999 To, The Commissioner of Income Tax (Appeals), Central-II Chennai-34.

Sir, Sub: Assessment in the case of Miss. J.Jayalalitha-AY 1995-96 & 96-97 certain particulars to be gathered at Mumbai-intimation regarding journey. Ref: your letter in D.No.ITA Nos.67 & 65/99-2000 dated 01.12.1999.

As directed I have conducted enquiries with few of the suppliers of Madras at Mumbai to ascertain the prevailing rates as of now and the rates during the financial year 1994-95 to 1996-97. The results of the enquiries are as follows:

1. M/s Simplex Enterprises: Summons u/s 131 was issued to Mr.K.K.Mistry, Partner. In response to the above he has furnished the quotation of different varieties of imported Italian marble as on 08.12.1999. The rate varied between Rs.125/- to Rs.300/-.

In the same quotation he has mentioned that the quality which was supplied to the assessee was "white Karara" on random sized basis (unpolished) at a rate of Rs.80/- per square feet. He has also furnished certain invoices raised during March and April 1996 to certain other parties, which reveal that the rate per square feet of imported marble was between Rs.100/- to Rs.180/-.

2. M/s New Diamond Granite Export- summons u/s 131 was issued to Mr.K.Madasamy-DW96, partner. In the quotation furnished the prevailing rates of different qualities of imported marbles vary between Rs.80/- to Rs.125/- per sq.ft. in respect of the rates for the three financial years 1994-95 to 1996-97 he has mentioned in the quotation that it varied between Rs.10/- to Rs.15/- on either side (+ Rs.10 to Rs.15). He has also furnished invoices raised during March 1995 and January 1996 in respect of certain other clients and the prevailing rates during that period was Rs.90/- to Rs.110/ per square feet.

3. M/s Pacific Marbles- summons u/s 131 was issued to the sales executive Mr.Raghu Suhalka. In response to the summons, he has furnished the quotation as on 08.12.1998, which shows that the different qualities of rough marble slabs varied between Rs.90/- to Rs.150/- per sq.ft. In respect of the rates prevailed during the financial years 1994-95 to 1996-97 he has informed me that the rates and the invoices raised to few clients will be forwarded to me in a week's time. Since, they were all at the head office at Udaipur.

4. Elegant Marbles and Grani Industries Ltd- summons was issued to Mr.Rakesh Agarwal, Director. He has furnished certain invoices raised to the clients during April, June and September 1996. Which reveal that the rate varies between Rs.100/- to Rs.130/- per sq.ft. In respect of the unsigned quotation shown to him he has informed me that he has not issued this quotation.

The copies of the quotations given by the above concerns are enclosed for ready reference.

Yours faithfully, (Dr.B.Senthil Kumar) Deputy Commissioner of Income tax, Central Circle II (2), Chennai.

Copy to: The joint Commissioner of Income tax, Central-II, Chennai.

Ex.D321 was marked through DW.96 - K.M.Samy @Madasamy has spoken about the marble slabs sold to Deepti Jewellers, No.221/228, Moti Dharmakata Bldg., Mumbadevi Road, Bombay, invoice No.410 dated 20.1.96. Particulars, marble slabs, 67 square feet rate at Rs.100/-. Ex.D322 is the invoice No.414, dated 22.1.96. New Diamond Granite Exports sold marble slabs to Swaraz Holding Pvt. Ltd., Maisan Belveted Bldg., Churchgate, Bombay. Square feet sold is 245.96 at rate of Rs.100/-. Ex.D323 is the invoice No.391, dated 4.1.96. New Diamond Granite Exports sold marble slabs to Jolly Maker, No.2, Cuffe Parade, Bombay. Square feet sold is 80 at rate of Rs.125/-. Ex.D324 is the invoice No.28.

The Director of Vigilance and Anti Corruption Department have valued construction of buildings at Rs.27 Crores. Therefore, he submits that the evidence of prosecution as well as the defence may be considered and recalculate the same.

I have carefully examined the evidence of PW.98 - Velayudhan. He has worked as Assistant Executive Engineer in Marina Division, Chennai, during the year 1996-97. He assessed the building at No.66, Anna Nagar. In that building, there are ground floor and first floor. The measurement of ground floor is 138.42 sq. meters - 1488.38 sq. feet. The area of the first floor is 151.42 sq. meters i.e., 1628.17 sq. feet. Total extent is 289.84 sq. meters i.e., 3116.55 sq. feet.

He further deposed that he assessed the building Door No.5, Murugan Street, T. Nagar. He does not mention about the measurement of the area. He inspected the building at 3/178C, East Seashore Road, Vettuvankeril. The building was incomplete. The area measurement from outside and calculated area is 305.36 meters. He also inspected the building along with the team pertaining to Building No.1, Murphy Street, Akkarai Village, East Sea Shore Road. Total area is 369.27 sq. meters i.e., equivalent to 3970.64 sq. feet. He also inspected the buildings in the grape garden premises at Jedi Metla, Faseerabad, Rangareddy District, Andhra Pradesh. In that place, a new building along with a compound was constructed with an area of 986 sq. meters (10602.15 sq. ft.).

During his cross examination, he states that they took Andhra Pradesh PWD schedule rates, renovated building is about 15 years old. They did not secure the sanction plan.

PW.116 - A. Jayapal, was Executive Engineer, Building Division-4, PWD, in the year 1996. He inspected the building along with the team in building No.21, Padmanabha Street, T.Nagar. First floor had an area of 158.49 sq. meters. Second Floor had area of 12.49 sq. meters. Another Room plus toilet had area of 8.63 sq. meters.

He has further deposed that he inspected a house at Nos.149, 150, Sriramnagar, T.T.K.Road, Chennai. It was an unfinished building. Basement area is 390.67 sq. meters. Ground floor is 486.79 sq. meters. First floor is 266.17 sq. meters. Plan was sanctioned in the year 1995. Construction was stopped about six months prior to inspection.

He has further deposed that he took the measurement for purpose of valuation of four buildings located at Nos.1/240, New Mahabalipuram Road, Enjambakkam. Marble slabs, Door frames and window frames were kept.

He has further deposed that two buildings located at 2/1, B-3, Seashell Avenue, Sholinganallur village. The total area 602.92 sq. meters.

He has further deposed that Second Building total area - is 705.71 sq. meters.

Team inspected building at No.19, Pattammal Street, Mylapore, Chennai. They considered only renovation work for valuation. Building basement area - 42.06 sq. meters. First floor area - 42.27 sq. meters. Second floor area 23.42 sq. meters. Door No.36, Poes Garden, Chennai was inspected and newly built area of the main building was 72.27 sq. meters (777.09 sq.ft.). Newly built area on the first floor was 49.12 sq. meters (528.17 sq. ft.). Highest degree of marbles, granite stone slabs, sanitary and bathroom fittings were used. Entrance of the dining hall had very expensive sculpture carved structures. Almirahs, sofa sets, tabletops were of high-quality materials. Building was raised on concrete pillars. There was cinema theatre attached to third and fourth floors. There was Conference Hall. Tables, chairs and sofas found there were of extraordinary craftsmanship. Campus had two generators of 125 K.V.A. and 62.5 K.V.A. A total of 39 air- conditioners, mini-cinema theaters, chandeliers were fixed at many places. Ex.P.671 is the valuation report and the valuation is Rs.7,24,98,000/-.

During his cross examination, he states that he did not put the quotation for granites, marbles, electrical items, ruby red stones, ornamental tiles, Dolpur stones. Materials used for centering were damaged. Steel rods in the columns were rusted. There was also a swimming pool. Most of the sanitarywares were of Hindustan Sanitaryware. Other fittings and pipes were of Jaguar Company. They did not seek the opinion of the forest department.

PW.146 - Kishore, Chief Engineer, was working in Prashanth Film Laboratory as Chief Engineer in Recording Section. In August 1995, Sri. Vijayan who was working in Ex.Chief Minister Selvi Jayalalitha's house contacted over the phone. He went to the House Door No.36, Poes Garden, constructed in the third floor of the multi storied building near house Door No.36, Poes Garden. He worked for 4-5 days and installed the things according to their instructions which was installed in mini theatre of the said house for cinema viewing. He gave bill for the work of Rs.25,000/-. Ex.P784 cheque was issued by Selvi Jayalalitha for sum of Rs.25,000/-.

PW.153 - V.Baskaran was working as Superintendent Engineer in Tamil Nadu Public Works Department, construction Division (Taluk-I). He prepared assessment for On the basis of the respective year of construction and the schedule rate of PWD, they prepared the assessment for

1) A.C.C go-down built in 1991-1992.

2) Workers Quarters constructing of ground floor - 5 houses and 1st floor - 5 houses built in 1994-95.

3) 2nd workers quarters consisting of 10 houses in ground floor and 10 houses in I floor and a guesthouse on the first floor and the platforms. Besides, they prepared the assessment for the compound wall build in 8 houses for the workers and a residential bungalow for the Managing Directors. The construction cost is as under:

Soft Costs: These are cost items added to the direct construction cost - they include architectural and engineering fees, legal permits and fees, financing fees, construction interest and operating expenses, leasing and real estate commissions, advertising and promotion, and supervision costs.

Ex.P.645 is the proforma accompanying the valuation report. Year of construction is 1995-96, new building and old building renovation. ABSTRACT ESTIMATE FOR CONSTRUCTION OF SENTRY SHED ITEM NO.3 Sl. Quantity Description of Rate Per Amount No. work

1. 19.312 Cost of 3385 1 65,371.00 m2 construction m2

2. Add for 9,805.00 external water supply and sanitary arrangements @15%

3. 11.45 Cost of 500 1 22,900.00 m2 marble m2 flooring

4. 65.66 Add extra for 32,930.00 m2 ornamental tiles 500 Add for service charges @9% 9,850.00 TOTAL 1,41,180.00 As per Ex.P.645 (Vol.33 Page No.97), according to the DVAC, and PWD Engineer, cost of constructions measuring area is Rs.65,371/- for 19.312 sq. mtrs, 19.312 sq. mtrs= 207 sq. ft., 207 sq.ft. is approximately 2.07 squares. As per the evidence on record, the value of construction for 207 sq.ft i.e., 2.07 squares is Rs.65,371/-. Therefore, for one square, cost of construction is approximately Rs.31,580/-. During the cross-examination of PW107-Sornam at page No.9, paper book page No.225 of Volume-4, he clearly admits that there are two methods to find building value. The detailed estimate and per square foot method are the two ways. In this case, we have adopted the per square foot method. In the instant case, total constructed area is 1,66,839 sq. ft. Now the question that arises for my consideration is, what is the rate that has to be assessed for construction of one square i.e., 10x10= 100 sq.ft. As stated earlier, the Public Works Department fixes the rate reasonably at the higher rate, taking into consideration of delayed payment and other miscellaneous expenses and in case, if the contractor borrows loan from the bank, the interest that is charged on it is taken into consideration while PWD fixes the cost per square. This is reasonably quite higher. The date of construction is during the check period. Therefore, considering the evidence of PW.107 and also Ex.P.645, I assess the cost of construction for one square may be around Rs.28,000/- at the relevant period. Normally, it includes foundation, bed concrete, plinth area, wall along with super structures, windows, doors, lintel, plastering, internal painting of doors and windows, flooring, electrification, water supply, sanitation, dadoing tiles, laying of tiles. Difference amount has to be borne by the owner in case granites or marbles are laid. Normally, it is considered as extra work in so far as staircase, flagging concrete, sump, pump, grill work. The Public Works Department will have cost included for delay payment and other miscellaneous expenses. No prudent owner will agree for construction of a building adopting the PWD rates. The PWD rates are reasonably high when compared to the rate charged by the contractor when he constructs a building adopting the method of square rate.

The total area constructed by the Accused Nos.1, 2, 3, 4, firms, companies is as under:

190 New/Additional 9510. 45 Sq. Ex.P677 Construction Building at Ft.

S.No.32/2-4, Plot Nos.S-7, Ganapathy Colony, Tr.Vi-

Ka Indl. Estate, Guindy, Chennai-32.

Total area granites used in the evaluated building Sl. No. Particulars Documents Total area

1. Land & building at Anna Ex.P.641 24.69 m2 Nagar

2. No.5, Murugesan Street Ex.P.642 Nil

3. 3/17, East Coast Road Ex.P.643 Nil Vettanankani

4. 1, Murphy Street Ex.P.644 4.926 m2

5. Jeedimetla & Pet Ex.P.645 165.23 m2 basheerabad, AP

6. Siruthavoor Farm House Ex.P.661 28.65 m2

7. Payyanur building Ex.P.662 28.19 m2

8. Anjaneya Printing press at Ex.P.663 675.74 m2 Ekkaduthangal

9. Anjaneya Printing Press, Ex.P.666 19 m2 Padmanabh Nagar

10. Building at 149, 150 TTK Ex.P.667 Nil Road

11. Sy.No.1/240, Ex.P.668 Nil Enjambakkam building

12. Sy.No.2/1, E-3 Ex.P.669 18.83 m2 Apartment, Sholinga 10.22 m2 Nallur Village

13. Door No.19, Pattaimal Ex.P.670 Nil Street, Mylapore Chennai

14. No.36, Poes Garden Ex.P.671 605.76 m2 33.63 m2 33.60 m2 231.47 m2 39.20 m2

15. Plot No.7, East Coast Ex.P.673 111.78 m2 Road, Door No.4130, 122.98 m2 Rajanagar, Neelakankai

16. MFT, Guindy Industrial Ex.P.674 8.27 m2 Estate

17. Compound wall, security Ex.P.675 29.71 m2 shed,

18. Door No.213, St. Mary's Ex.P.676 Nil Road, Menthavali, Chennai

19. S.No.32/2-4, Plot No.7, Ex.P.677 32.82 m2 Ganapathy Colony Road, VK Industrial Estate Guindy

20. Ponnagar, Trichy Ex.P.782 109.89 m2 2384.3 m2 TOTAL 25662.22 sq.ft.

1 Square Metre= 10.763 Sq. Ft.

1 Square Feet= 0.093 sq.mtr.

1 Square = 10 x 10 sq. ft.

ANNEXURE-IV MARKED THROUGH PW.259 EXPENDITURE INCURRED BETWEEN 1-7-91 AND 30-4-96 TOWARDS SANCTION PLAN & ARCHITECT FEES Sl.No. Details of Expenditure Amount in Rs.

Amount Paid to Corporation of Madras 1 towards sanction of building plan in 14,560.00 respect of M/s. Anjaneya Printers (P) Ltd., at No.21, Padmanabha Street, T. Nagar, Chennai-17, Amount paid to Corporation of Madras towards building plan in respect of M/s. 2 Lex Property Development Ltd., No.149, and 150, TTK Road, Chennai-18 1,45,320.00 Amount paid to Corporation of Madras for 3 building plan at No.36, Poes Garden, for additional construction 12,700.00 Amount paid to corporation of Madras, for 4 building plan at No.5, Murugesan Street, T. Nagar, Chennai.

70,140.00 Amount paid to Corporation of Madras for 5 building plan (Jaya Publications) at No.19, Pattammal Street, proposed additions and regularization of the existing building 1,350.00 Amount paid to Corporation of Madras towards sanction of Building plan in 6 respect of M/s Jaya Publications at plot no.S-7, Ganapathy colony, Guindy Industrial Estate (Idhayam Publication Property)

(i) Development charge Rs.2500/-

Amount Paid To Corporation Of Madras For Building Plan At No.36, Poes Garden 7 Additional Block.

building plan at No.36, Poes Garden, for additions of security room 10,925.00 Amount paid to Corporation of Madras for 9 building plan at No.48, Inner Ring Road, Ekkatuthangal, Guindy (i.e., M/s Sastri Nuts and Plates Manufacturing (P) Ltd.,M/s Anjaneya Printers (P) Ltd., 29,850.00 Amount paid to Corporation of Madras 10 towards building plan sanction in respect of the proposed alterations to the existing building at Door.No.212, 213, St.Mary's Road, Mylapore, Chennai-4, of Selvi.J.Jayalalitha 1,785.00 11 Amount paid to MMDA for building plan approval at Plot.No.6, Thiru Vi-Ka Industrial Estate, Guindy, 4,76,525.00 12 Amount paid towards demolition cost of the old building at door No.213, St.Mary's Road, mandaveli, Chennai-28 18,570.00 13 Amount paid to Tr. A.K. Vijaya Shankar from CA 2219 of Canara Bank, Mylapore 20,000.00 of Tmt. J. Elavarasi 14 Amount paid to Tr.A.K.Vijaya Shankar from CA 1171 of Indian Bank, Abiramapuram of Tmt.J.Elavarasi.

166834.68 sq. feet. Now the question that arises for my consideration is what is the rate that has to be assessed for construction of a square [10 x 10] = 100 sq. feet. As stated earlier, the Public Works Department fixes the rate reasonably at the higher rate taking into consideration of delayed payment and other miscellaneous expenses to the contractor. As stated earlier, as per PWD itself, the construction cost per square will be Rs.31,580.19/-. This is reasonably quite higher. The date of construction is during the check period. The construction rate per square may be somewhere around Rs.28,000/-.

In the instant case, Team of Engineers inspected several buildings and they valued the buildings. PW.107 who is Superintendent Engineer, PWD, has deposed that there are two methods to find building value, detailed estimate and per square foot are two ways. Though several Engineers have inspected the buildings mentioned in the annexures and the valuation report have been prepared, in some valuation not all the Engineers who inspected the buildings have affixed their signatures. Some of the Engineers who valued the reports have been examined as defence witnesses. Though there are about 14 Engineers who inspected the building and prepared the valuation report, when they entered into witness box, except marking documents they have not spoken anything about measurement of the floor area where marbles and granites are laid. The measurement relevant to this has not been furnished by them while giving evidence.

I have carefully examined the exhibits and ascertain the square feet even though it is mentioned in square meters. The Engineers who gave evidence before the Court have not stated as to what was the square feet of the building, how many square feet marbles has been laid, how many square feet granite have been laid. The valuation report relating to laying of granites and marble stones on the floor do not prove themselves. The facts mentioned therein have to be proved by evidence after giving opportunity to opposite parties to contest the correctness of such evidence by cross examination. It is well settled that the documents do not themselves prove the contents therein. The proof of contents have to be given by cogent evidence. In the instant case, Engineers who have deposed before the Court have omitted to state the measurement of the buildings, measurement of the area of laying granites and marbles. They simply stated that highest quality of granites, marbles, sanitary fittings, electrical fittings were installed. The samples of marbles and granites were not extracted and no quotations have been sought from the granite suppliers. Everything assessed is done more or less on guesswork rather than actual price prevailing during the check period. There is positive evidence to the effect that the sanitary equipments used are of jacquard make and granite and marbles are more or less of the cost of Rs.70 to Rs.100 per square feet. I have adopted the method of determining the valuation on the square feet method as stated by PW.107. I have calculated price of 1 square at the rate of Rs.28,000/- towards cost of construction and for extra work it is valued separately. Accordingly, I have calculated the cost of construction as under:

In respect of Marriage Expenses, the following prosecution witnesses were examined, they speak as under:

PW.181 - Thangarajan, Assistant Engineer, Building Construction-3, Sub-division-II, Chennai. The Superintendent of the Anti-Corruption Department entrusted him to estimate the expenses incurred at the wedding and reception of V.N.Sudhakaran, foster son of former Chief Minister Selvi Jayalalitha. He consulted Architect Vijayashankar Art Director Thota Tharani, his assistants Gopinath and Ramesh, B.S.Mani, the Electrician, they went to MRC Nagar, place of wedding and saw the place of reception, then to the film city J.J.Nagar, at present it is renamed as MGR Film City. He submitted estimate report. Architect Vijayshankar gave him the drawing of the wedding choultry and the measurement of the pandal. Thota Tharani gave only the sketch for decorative arches, work was done by his Assistant - Ramesh. He came to know the measurements. Ex.P1019 is the estimate report. For the wedding at MRC Nagar, pandal of 2,35,200 Sq.ft. with coconut leaf inclined on both side was erected. They estimated the cost to a sum of Rs.18,81,600/-. For dining separate coconut thatched pandal was laid at 2,16,000 Sq.ft. estimated cost is Rs.17,28,000/-. For the special guest, separate meal lounge with iron sheet roof was made for 2,400 sq.ft. estimated cost is Rs.3,84,000/-. At the entrance of main pandal also, ceiling with a decoration was laid for 1,57,980 sq.ft, color spreads were decorated with gift papers, it was estimated to Rs.66,35,160/-. A permanent wedding dais was constructed with bricks steel sheets and asbestos sheets. In that, two bedrooms, two reception halls, two bathrooms were constructed. The stage was built in 9,392 sq.ft. The sketch of the wedding stage was attached as per Ex.P1019. Its value has been estimated to Rs.35,22,000/- Four Air-Conditioners were fixed for bride and bridegroom. The expenses incurred and that was estimated to Rs.3,00,000/-. 2,500 VIP Chairs were used, Rs.1,25,000/- is its value. 10,000 ordinary Chairs were used, its value is Rs.1,50,000/-. 12,800 Chairs were used at the Dining Hall, its value is Rs.1,28,000/-. 4,800 Dining Tables were used, estimated value is Rs.48,000/-. For VIP Dining Tables and Chairs, Rs.2,72,880/- has been spent as per the receipts. Rs.7,28,527/- has been spent on Roads. A total of Rs.2,11,00,000/- was spent on pandal, wedding dais, Chairs and Tables for the wedding at MRC Nagar. Main pandal was erected for 14,400 sq. ft., it is valued at Rs.1,15,200/-. Its roof was covered with iron sheets. It was put for about 5,500 sq. ft. at Rs.87,400/-. The expenses incurred only on pandal at the film city was Rs.15,00,000/-. In Ex.P1019, it is revealed that estimate for pillars, color lights, stages, decorative arches erected during reception at Film City and the wedding at MRC Nagar was Rs.3,65,00,000/-. They have prepared and given the total estimate for Rs.5,91,00,000/-. In Ex.P1019 report, the expenses incurred on meals, tiffin, dinner of the pre-wedding day, drinking water, Crackers, Tonga, Elephant, Horse, Chariot, Video, TV's Folk Dance, Bharatanatyam, Music performance were not included.

During his cross-examination, he states that he has prepared the estimate on the basis of the sketch. He has signed in the sketch. Other than that, there was no connection between him and the sketch. Nobody has sent him an invitation for the wedding. He has not attended the wedding. He does not know personally whether reception Hall, wedding pandal and decorative arches were there. For the preparation of the report, whatever is heard and seen from the sketches, he has prepared the report. He does not know personally whether the details of the drawing were correctly followed. In this sketch, nothing about decorative arches is mentioned. Thota Tharani is one of the best Art Directors in India. The handwritten material of Thota Tharani was not attached to his report. He has prepared the report based on ten categories under the heading of General Discussion. He had been to MRC Nagar. When he went there, it was a vacant land. He did not see the marriage choultry mentioned in item No.1 in his report. The second item i.e. mainpandal was also not there. The third item - pandalpark, common dining with kitchen set was also not there. The fourth item pertains to VIP dining with kitchenset was not there. He did not see the item written under the headings Arches, Stages, Pillars, Cut-outs from Adyar Signal to MRC Nagar and near and around No.36, Poes Garden. The seventh item is under the heading of Electricityarrangements. He did not see those electrical arrangements. He did not see the Mantap above the stage mentioned as in the ninth item. He did not see the tenth item - the artificial grass land and the artificial fountain. He did not see the main pandal supposed to have been erected by J.J.Film City. He did not see pandal, kitchen set, arches and the electrical illuminations. What he has written in page No.15 of his report is that what was done in MRC Nagar and in the Film City. What he has mentioned in his report is on hearsay. He enquired with shopkeepers like Yesu Udayavan Ashirvada Nadar, Jyothi Traders. He enquired with regard to erecting of pandal, chairs etc. with them. With regard to Carpet, he enquired M.A.Jacob. With regard to illumination arrangements, he enquired Suresh Electrical. With regard to Sound Service, he enquired Thiruvengadam. In Jyothi shop, he enquired about pandal. He did not ask for any quotation. It was orally done and he wrote them. He did not attach any notes. He did not ask about six shopkeepers whether they took part in the wedding. He did not enquire about the persons, who erected the pandal and the arches. For preparing the report, photographs were not relied. He has not seen any photos connected with the marriage. He did not enquire anybody to confirm the sketches. The estimates with regard to the matters in the drawing were put based on the measurement mentioned in that sketch. The drawing is not approved. Based on this drawing, building may or may not have built. He does not know who erected the pandal. Vijayashankar gave him the information about the area. The estimate area of the main pandal is 2,35,200 sq. ft. In his estimate report, no mention is made that how many ordinary decorative arches and how many special decorative arches were there. He did not measure the length and breadth of the place, where decorative arches were erected. After enquiring with A.K.Ramesh and Srinivasan, he calculated the rate at Rs.135/- per square feet for decorative arches. There is no connection between the stage mentioned in sketch and the stage mentioned in the item No.2 of page No.3 of his estimate report. He has not mentioned about how much material is needed for one pillar. He has not mentioned about the shape of that pillar in his estimate report. He came to know about this pillar, only when he spoke to others. No sketches were made to describe the models. In his estimate report, he has not mentioned that there were three types of pillars. He did not enquire any General Public regarding the place where the cut-outs were fixed. He does not know from where the decorative lamps, Halogen lamps, tube-lights, generator, mobile generator were taken on rent. In his report, he has mentioned the capacity level of the mobile generator. He has not seen the Account Registers with regard to the amount remitted to the Chennai Corporation. In his report, he has mentioned that 20,86,000 units of electricity had been consumed. But he had not indexed it. Nobody has to pay the electricity charges using the generator. He has not mentioned in his report that how much electricity has been consumed from the generator and through the electricity board. He does not know how much money has been remitted to the electricity board. In the sketch attached to his report, no mention was made about the Marriage Mantap. In the drawing, no mention was made about the artificial grass lawn and the Korean grass. In his report, at page No.35 of the tenth item was allocated for unexpected expenses. He did not measure and see the vacant place at MRC Nagar. He did not ask any Contractors to draw the sketch for the measurement of the main pandal. He did not enquire about any pandal contractors. He did not know how much money was paid to that contractor. He did not know whether it was done by onetime payment or whether done by the AIADMK volunteers themselves. In his report, he has not mentioned how many fronts (Coconut thatch) were required for that main pandal. He did not know how many Caesarian woods were needed. He did not know the person who made the dining hall pandal. He did not know how much money was paid to him. He did not know whether only one contractor had put up or the Anna All India DMK Volunteers had put it up. He did not receive the sketch for that dining hall from anybody. He did not know the information as to who constructed the VIP dining hall. Nobody gave him any sketch regarding that. In his report, he did not mention the cost of one sheet. He has not mentioned how many sheets were used, the names of the technical experts to whom he made enquiries regarding the rates. He did know whether the wedding of the son of Thiru Thangarajan took place under the leadership of the Chief Minister. The new wedding stage height was not mentioned in the sketch attached with Ex.P1019. He did not measure the place in MRC ground where the wedding was supposed to have taken place. On 18.4.1997, he went and saw the place. The area of MRC is 5,33,867 sq.ft, which includes the stage. Vasudevan and he himself did the estimate of all the variety of materials mentioned in his estimate report. The length and width of the VIP chairs and the ordinary chairs were not mentioned. The number of chairs put for wedding are 12,500 (including the VIP Chairs). He did not have the information whether the people occupied 12,500 chairs or whether they were vacant. The bill number was not mentioned in his report. The date of the bill was also not mentioned. In his report, he did not mention either the type of artificial fountain or the length and width of it. He has not seen the fountain. In his report, he has not mentioned the length and width of the artificial grass lawn and Korean Grass, the number of flower pots and its varieties. The flower pots price differs depending on the quality of the flowers. He did not mention the type of flower pots and the area of Korean Grass. He has not mentioned in his report whether Banana trees were planted. He has not prepared any estimate report in connection with wedding. He has not constructed any artificial fountain. He has not mentioned about the pressure and the capacity of the artificial fountain. He has not mentioned in his report the horse power of the machinery. He did not consult the Horticultural officer at Tharamani regarding the preparation of estimate report. He has not mentioned in his report what the unforeseen item No.1. Chair needs an area around 4 ½ sq.ft. one cannot sit by putting a chair in lesser area than that. If it is a VIP chair, then they need atleast 6 sq.ft. To put VIP chairs, 15,000 sq.ft. space is required and for ordinary chairs, 4500 sq.ft. space is required. For the chairs at the main pandal, 60,000 sq.ft. space is required. 672 sq.ft. is the length and 70 ft. is the width of the main pandal. The floor area was 2,35,200 sq.ft. In the abstract, it is mentioned as plywood false ceiling. In his report, he has mentioned the information as false ceiling. Carpets are of two types. One is cloth and the other is coir. He did not mention in his report what type of carpets were used there. In his report, he did not mention how many beams were supporting the false ceiling. In his report, he did not mention the price, length, breadth and the depth of the glittering paper used. In his report, he did not mention how many caesarian sticks (beams) were needed to make the frames length and crosswise. He did not mention what types of ropes were used. No differentiation was made for the bamboo ropes. In his report, he did not mention the length of the rope needed. The estimate report was prepared on the instruction of PW.259 - Nallamma Naidu. He accepted the job since it is possible to the estimate if the drawing and the measurements are given. The only drawing given to him was the one attached to Ex.P1019.

From Ramesh, he did not take in writing the measurements of the stage and the places where those stages were erected. He did not mention separately in his estimate report, the height of the room. He did not mention the carpet area of the room. It is not possible to give individual estimate for the buildings in the sketch. Further, when he saw, they were not there. It was not possible to say what kind of materials are used for the building if the estimate report is prepared by looking at the sketch. As per the market price, he has mentioned the rate as Rs.375/- per sq.ft. He did not enquire about the kind of brick that has been used to construct that building. He did not see 1995 account register to find out at what price the bricks were sold. He did not mention in his report how many bricks were used. In his estimate report, he did not mention the schedule rate. He did not mention the list of material costs, the cost of material and the cost of labour. His report is prepared without the break-up of the particulars. He did not mention what type of ceramic tiles was put. He did not mention the type of air cooling. He has not specified the number of wooden doors and aluminium doors. He did not enquire about who erected the pandal. He did not write the name of the contractor in his report. He followed the observed data to estimate. There is a difference in rate with regard to the standard rate and observe rate. No explanation has been given in his report for having taken observe rate and leaving out the standard rate. The information regarding how many lorry sea sand were used to fill in the stage is not there in his report. He has not given any break-up figures and did not collect any evidence to show Rs.375/- is the amount per sq.ft. in his report. The items mentioned in his estimate report at page 21 of item No.3 is the estimate of the basic items they brought on their own and manufactured pipe, fittings, asbestos cement sheets, steel stressors, doors, aluminium doors as such might have been rented. He did not mention which company AC was used. He did not mention in his report the measurement of coir mat used for the main pandal. He did not mention in his report about the rent of coir mat. It was not possible to find out who prepared the food for that wedding. He could not find out who did the video coverage. Depending on the type of chairs, its rent differs. Stage mentioned in his report includes the rooms of the bride and the bridegroom. In his report, he has not given the break up details of a material and its value estimate. No individual labour charges were mentioned for anything. He did not mention in his report how much thickness of thermocoal has been used. The price differs from brand to brand. He enquired and found out the sand rate as Rs.124/- per cubic feet. Upto Rs.30 Lakhs, the Superintendent Engineer can accept the estimate. The estimate above 50 Lakhs, only the Chief Engineer should give the acceptance. He did not mention in his report, what kind of country wood was used. He did not mention in his report, what width of plywood was used. There are two types of GI sheets plain and bent. 2-3 designs are in it. Many companies manufacturing it and they come in different thickness. There is price difference according to manufacturers. There is a lot of difference between the ordinary sheet and the bent sheet. In his report, he has not mentioned whether sheets have been taken on rent and on the rental basis. He did not mention in his report the length and width of the barricade sheet. He did not go through either the bill or the document connected with barricade. He did not attach any document with his report to indicate the rate/square feet to fit on barricade. There are no different sized in Gravel. Observe cost includes the loading and unloading of material and conveyance charges. The area of the kitchen was 49,275 sq.ft.(including all the kitchen in MRC Nagar). In his report, he has not mentioned whether the Korai mats were brought. He did not mention the measurement of the back side pandal. The reason to mention as JCB earth mover in his report was that the contractor told him that he used that machine. He did not take and attach any document with his report from that contractor. He did not mention in his report whether one or more JCB machines had been used. He did not mention in his report whether the contractor had rented the JCB machine or used his own. In his report, he did not mention whether after the use of the JCB machine the Road Rollers and people too worked. He did not take any report from the contractor who was supposed to have worked with the JCB machine. There is a Registration number for JCB. In his report, he did not mention the registration number of that machine. He did not look into any logbook. There was a school near that ground. He did not enquire with that school or the residents in the quarters whether the JCB machine was used. He did not mention in his report what color paper flowers was used. 95,200 sq.ft. refers to the ceiling area of the pandal. He did not mention in his report the main pandal was divided into two parts. He did not mention in his report decoration of the pandal was this way. He did not mention in his report the expenses for shaping those flowers. He did not mention water supply charges, labour charges, plumber charges.

In his report, he has not mentioned that how much quantity of jelly, tar have been used, water tank, length, width and height of the wall, nature of roof, septic tank, door ventilator, its quality and labour charges.

In the J.J.Film City abstract, he has mentioned item Nos.1(A) - pandal and dining pandal, 1(C) - kitchen pandal, false ceiling, G.I. sheet covering the kitchen, Khora mat, red carpet for dining hall, wall banner for dining hall, rent for the chairs, rose wood chairs, plastic chairs, banquet chairs, plastic holder chairs, table cloth, buffet cloth.

He did not mention the material with which the pandal was made, thickness of the pillars, rental charges of G.I. sheet, length and width of kitchen pandal, square beams, type of wood, reapers, glittering paper, ventilators, grass mat. In his report, he did not mention that as to which the contractor erected the pandal, whether the carpets were rented or not. He has not explained in his report what is meant by rose-wood cushion chair or banquet chair. He did not mention in his report whether illumination were there on these arches, whether the arches were built with cement, whether paint were applied, whether decorative lamps were taken on rent or not, type of generator and capacity. He did not check the receipt or amount remitted to Chennai Corporation in respect of Rs.18,75,000/-. He did not avail the Horticultural Expert to estimate the valuation of grass. He did not watch either the video or film or photographs related to this wedding function. He did not mention in his report or in the abstract, Rs.76,787/- was spent towards, coffee, tea, lunch, rope and nail.

PW.183 - T.Ramesh speaks about printing of wedding invitation. PW.237 - Jawahar, Assistant Secretary to the Chief Minister, has placed order to print 65,000 wedding invitations and 5,000 car passes. A-1 gave cheque for Rs.11,00,000/-.

PW.184 - A.Vincent, a travel agent, who has sent ten cars in connection with the marriage of V.N.Sudhakaran to the guests. He has received Ex.P1285

- a cheque for a sum of Rs.27,502/- issued by Selvi.Jayalalitha.

PW.185 - A.Premkumar, who was running a Tourist Car Rental Company. He has sent 15 cars for the marriage of V.N.Sudhakaran. Selvi. Jayalalitha has paid the amount of Rs.19,211/- through cheque - Ex.P1286.

PW.186 - Chalapathy Rao was the furniture hirers. Sachithanandam, PRO of former Chief Minister requested for tables and chairs in connection with V.N.Sudhakarn's marriage. He gave the cheque for Rs.1,30,000/- as advance amount. He asked to deliver the tables and chairs to MRC Nagar and MGR Film City. Mr.Naveen - Deputy Manager of Adayar Par Sheraton Hotel asked him to supply decorative articles and clothes. These requisitions were sought in connection with the marriage of V.N.Sudhakaran. Cheque for a sum of Rs.57,250/- was given and the same was issued by Selvi Jayalalitha on 6.9.1995. The balance amount of Rs.2,65,000/- was with them.

During the cross-examination, he states that certain articles were rented-out for the purpose of party function.

PW.189 - Mahalingam was the office administrator of the All India Anna DMK Head Office from 1991 to 2000. He was entrusted with the responsibilities of sending wedding invitation of V.N.Sudhakarn's marriage to the party members by post. He has sent 56,000 invitations from Anna Salai Head Post Office to the party members. He has paid Rs.4/- for each invitation. Its total cost was about Rs.2,24,000/-. He has received amount from Jawahar Babu, Joint Secretary of the former Chief Minister. 56,000 invitations were sent by his Assistants namely, Ramesh, Sukumar, Krishna Murthy, Mani and others. He did not sign the vouchers for having received any amount. He does not have any documents to show whether invitations were sent by Certificate of Posting or by Registered Post. Accused No.2 and accused No.4 did not give money to him.

PW.191 - V.Srinivasan is a musical instrument Mandolin player. Mr. Jawahar asked him over phone that not to accept any other appointments on the day of marriage of Sudhakaran. He went to marriage reception which was held at film city, Cinema Nagar, Egomore, Chennai and conducted the Mandolin Orchestra. When they asked him about the money, he refused to take the money, as it was Chief Minister's function. They gave him a silver plate, silk saree and a small kumkum box. When he was enquired by the police, he handed over the above mentioned things to the police. The police have taken the silver plate, small kumkum box and silk saree from him in the year 1997. Mahazar was not drawn at that time. When he participated in the musical programmes, these types of gifts would be given to him.

PW.196 - Aijaz Ahmed, Tailor, who was running a shop in the name of Syed Bakher & Company. He stitched the clothes for V.N.Sudhakaran for his marriage. He has received the cheque for a sum of Rs.1,41,025/- towards stitching charges from Ramkumar.

PW.200 - K.P.Muthusamy is the retired Chief Engineer. He has deposed that after retirement, he has registered in "Fellow of Institute of Valuers Organisation". He has the capacity of assessing buildings. Jawahar told him to come to the Chief Minister's residence, because a marriage was going to be held, so many arrangements should be made. Jawahar took him to the first floor and introduced him to Sasikala. Jawahar told her that he had come over there to look after the pandal work. He has deposed that the pandal was made with coconut leaves for the marriage functions. The pandal work was going on in MRC Nagar. Vijaya Shankar, architect gave him a plan for pandal and stage arrangements. The contractors Rajappa Nadappa, Rajagopal Ramachandra Nadar and Kumareshan Nadar were also present there. In MRC Nagar, he got introduced to PWD contractor Mr. Ethiraj. 5 main pandals to perform the marriage ceremonies with the measurement of 70 ft to 750 ft were put up. They were constructed with coconut leaves. Coconut leaves pandals with the measurement of 60 ft to 450 ft were put up to serve food for the public. 2 pandals with the measurement of 60 ft and 200ft for serving food for VIP were put by Mannargudi Rajagopal. One cooking shed, for VIP's measuring 45 ft. to 135 ft. was put with asbestos sheet. The above mentioned pandals were put by Kumareshan Nadar. Marriage platform, bathroom, the rooms for the bride and bridegroom measuring 9392 sq.ft. were built with bricks and roofed with AC sheet. This work was done by Ethiraj. Air conditioners expenses were met by the Former Chief Minister. The work of laying gravel road, around the marriage plat form was done by K.V. Natarajan. He brought 2-10 KW generators and 4 mobile generators. The bride's father Mr. Narayanaswamy gave him a total sum of Rs.16 Lakhs in 4 instalments. He told him to submit the accounts to Ramkumar. Ramkumar is an uncle of the bride. He received that amount and gave Rs.3 Lakhs to Gopinath, Rs.1,75,000/- to Pauldasan and Rs.10,000/- to K.V. Natarajan. The wedding reception was held in Cinema Nagar, Chennai on 10.09.1995. For that the pandal work was done by Kumareshan Nadar. The decoration work was done by a North Indian by name Paulbabu. For this Rs.1.50 Lakhs was sent from Poes Garden. The carpenter's wages, cost of plywood nails and reaper were paid by him and he gave the vouchers for that. For this function, 6 connections were taken from the Electricity Board. From Adyar Vinayagam temple to MRC Nagar, the paths were decorated with decorative lights by R. Subramani and G.M. Samy by using the temporary electrical connections. He gave Rs. 3,54,000/- and odd to Mr. Subramanyam and Rs.4,89,000/- and odd to G.M. Samy. He presented the accounts to Mr. Ramkumar and handed over the remaining amount of Rs.4,422/- to him. When he was supervising the work in MRC Nagar, one person came and gave him the marriage invitation with a silver plate, a silk saree, silk dhoti and silk angavastram. During investigation, he handed over all these things to the Anti-Corruption police. M.O. 1594 is the silver plate given with the invitation, M.O. 1595 is the silk dhoti, M.O.1596 is the silk angavastram and M.O. 1597 is the silk saree were handed over. He did not tell the police about the expenses of levelling. He did not tell particularly about the number of AC machines. There are two kinds of pandals, big and small, he only told which pandals should be done by whom. He did not supervise the work done by Art Director Gopinath. Ramkumar is one of Shivaji Ganesan's son. He does not remember on which date Rs.1.50 Lakhs was sent from Poes Garden. He does not remember who brought that money and gave it to him. He does not know personally, how much money was spent in MRC Nagar for the marriage.

PW.214 - A.R.Rahman is a music composer. Selvi Jayalalitha requested him to perform a musical programme for her son Mr.Sudhakaran's marriage on 6.9.1995. Mr. Bhaskaran along with his wife came to his house and gave the invitation with 2 silk sarees, silver kumkum casket and silver sandal bowl in a silver plate. During the investigation, he handed over all these articles to the officers of the Prevention of Corruption Department. Prabhu, S/o Shivaji Ganesan also invited him personally for this marriage. As per that on 6.9.1995, he performed the musical programme for one hour. About 25 to 30 persons were in the orchestra. He did not charge any amount for that programme.

During the cross-examination, he states that he considered it as a privilege to conduct the music programme. He did not ask for remuneration.

PW.224 - K.N.Thiyagarajaswamy has deposed that during 1995, for Sri. V.N. Sudhakaran's marriage in Chennai, he cooked exclusively for VIPs. Sasikala and her sister-in-law Tmt. Santhana Lakshmi and others who appointed him for the cooking. They told him to meet Ramkumar. He supervised the preparation of afternoon meal. For each leaf, he prepared three sweets including carrot halwa, pachadi, two poriyals, chips, vada, happalam, payasam, rice, sambar, rasam and curds. Based on his fifty years experience and prices then prevailed, he estimated that Rs.55 to Rs.60/- was spent to each meal. About 2,000 VIPs consumed food. The VIP dining place could seat about 350 to 400 persons at a time. 20 persons worked under him. They gave him Rs.11,850/- as salary. A person from Shivaji Films gave the above mentioned cash. For 200 persons, six sacs rice was used. 120 to 150 kgs. of vegetables were used. He does not know anything about cool drinks, juice and thambulam items.

During cross examination, he states that the bride is the actor Shivaji Ganeshan's grand daughter. He received payment in cash from Shivaji Films.

PW.228 - R.Rajasekaran speaks about the expenditure of the marriage. He has deposed that 38th item of Ex.P2218 contains 928 pages of Sudhakaran's marriage expenditure. Bills and Receipts are at Ex.P2220. Ex.P2220 is the letter written by Assistant Director of Income-tax (Inv.), Unit-IV, Madras-34, which reads as under:

GOVERNMENT OF INDIA OFFICE OF THE ASSISTANT DIRECTOR OF INCOME TAX (INVESTIGATION) UNIT IV (4) 108, Mahatma Gandhi Road, Madras-600 034 Date:19.09.95 To, Miss. J. Jayalalitha, 36, Poes Garden, Madras-86.

Madam, In connection with the recent marriage celebrations of your foster son Shri V.N. Sudhagaran, you are requested to furnish the following details:-

(1) The charges paid/payable for the use of the land at M.R.C. Nagar in which the marriage was celebrated together with the name and address of the person to whom such charges are payable/paid.

(2) Expenditure incurred on the 'Pandal' at the marriage site and details of payments made for this purpose to the contractors together with their names and addresses. The land are over which the pandal was erected may also be indicated.

(3) Expenditure incurred on leveling the land and laying of roads and construction of buildings at the marriage site.

(4) Expenditure on the decoration of the marriage pandal as well as the expenditure incurred on putting up the wedding platform and the cost of decorations made thereon.

(5) Expenditure in the printing and distribution of the wedding invitations. In this connection, details of the expenditure incurred to the gifts given to the invitees along with the marriage invitation such as silver plates etc, may also be given.

(6) Expenditure on the provision of food, tiffin and other refreshments to the invitees on all the days of the marriage celebrations including the expenditure incurred at the time of marriage reception on 10.09.1995. Any expenditure incurred in catering arrangements entrusted to outside agencies may also be furnished. (7) Expenditure on the electrical and lighting arrangements for the marriage both at the marriage site and elsewhere including the electricity charges paid/payable.

(8) Expenditure on the purchase of flowers and on floral decorations.

(9) Expenditure on vegetables, milk etc., (10) Expenditure on provision of accommodation to the various invitees in hotels, guest houses and other places.

(11) Expenditure in the hiring of cars and other vehicles in connection with the marriage.

(12) Expenditure on the purchase of Jewellery for the marriage.

(13) Expenditure on the dresses, clothes and other textile items for the marriage.

(14) Expenditure in the video coverage of the function.

In this connection, details may also be furnished regarding the expenditure incurred on the provision of closed circuit T.V. facilities as well as the expenditure incurred on photographs taken during the marriage. (15) Expenditure in respect of the horse-drawn carriage used at the time of "Mappillai Azhaippu". (16) Expenditure on the crackers and other fireworks during the marriage celebrations.

(17) Expenditure on the musical entertainment provided on the 6th, 7th and 10th of September 1995. (18) Expenditure in the purchase/hire of furniture for the marriage.

(19) Expenditure on the gifts given to the volunteers and others in connection with the marriage. (20) Expenditure incurred on putting up the various cutouts, mandapams, arches, statues, pillars, decorative dais, banners etc. (21) Details of gifts received on the occasion of the marriage together with the details of persons who made such gifts.

(22) Details of any other expenditure incurred in connection with the marriage.

(23) Details of expenditure incurred in connection with the betrothal function in June 1995.

While giving the details of the payments made in respect of the various to whom such payments were made, the date(s) on which the payments were made and the mode of payment i.e., by cash, cheque /draft may be specified.

The aforesaid information is called for under section 133A(5) of the Income Tax Act, 1961. Details called for may kindly be furnished by 29.09.1995.

Yours faithfully, (T.SASIKALA) Asst. Director if Income Tax (Inv) Unit-IV(4), Madras-34 The reply given by A-1 to the above said letter reads as under:

To, The Asst. Director off Income-Tax (Invn.) Unit IV (4), 108, Mahatma Gandhi Road, Madras-600 034 Madam, Sub: Furnishing of Details required by your letter dated 19.9.1995-Reg.

The details required by you are furnished seriatim:

1) No charge has been paid or is payable for the use of the land in MRC Nagar in which the marriage was celebrated.

2) No expenditure on the pandal at the marriage site has been incurred by me, the same having been met by the bride's family.

3) No expenditure on the items stated was incurred by me.

4) Expenditure on the decoration of the pandal and the wedding platform was met by the bride's family.

5) A sum of Rs.12,00,050/- was spent by me on the printing of invitations, identity cards, car passes and printed polythene bags, as per details below:

Sl. No. Address of the Cheque No. Amount payee 1 M/s. Moulis 597103, Rs.11,00,000 Advertising 16.9.1995 Services (Pvt.) Ltd. Canara Bank, Mylapore Branch 2 M/s. Rock Aads. 597103, Rs. 30,050 Madras 15.09.1995 Canara Bank, Mylapore

3. M/s. Madras Foils 597107, Rs. 70,000 Ltd. Madras 15.9.1995 Total Rs.12,00,050 A sum of Rs.2,45,000/- was incurred on distribution expenses. No gifts were given to the invitees along with the invitations.

6) Expenditure on provision of food & refreshments on the evening of 6th September and the morning of 7th September was incurred by me in respect of provisions for reception paid to Mr. M. Abbas, Vikkiravandi vide cheque No.597112/16.9.1995 drawn on Canara Bank, Mylapore, Madras. Other expenditure on provision of food and refreshments was incurred by Mrs. N. Sasikala for the reception on evening of 10th September, 1995.

7) Electrical and lighting charges at the marriage site were met by the bride's family & Mrs. N. Sasikala.

8) Expenditure on purchase of flowers and on floral decorations incurred by the bride's family and Mrs. N. Sasikala.

9) Expenditure on vegetables, Milk etc for marriage were met by the bride's family and for the reception by Mrs. N. Sasikala.

10) The following is the sum incurred by me on accommodation for invitees:

Park Sheraton.... Rs.1,75,246-2 (By cheque No.597108 drawn on Canara Bank, Mylapore)

11) Expenditure incurred by me on car hire charges paid through by canara bank account amounted toRs.78,430/- as per details given below:

i) Anchor Cabs, Madras-35 Rs.19,211 (Ch. No.597115)

ii) AGK Travels, Madras-8 Rs.15,814 (Ch. No.597116)

iii) Govind Cabs, Madras-34 Rs.15,903 (Ch. No.597117)

iv) Vincent Travels, Madras-10 Rs.27,502 (Ch. No.597118)

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Rs.4,84,712/- paid to Kumaran Silks, Madras-17 by my canara Bank cheque No.090993.

14) Expenses on Video Coverage etc., were incurred by the bride's family and Mrs. N Sasikala. The Photograph expenses from my side amounted to Rs.54,660/- and paid to Balu's colour labs, Madras-4 by cheque No.597114 drawn on Canara Bank, Mylapore.

15) Expenses relating to the horse-drawn carriage used at the time of Mappillai Azhaippu were incurred by the bride's family.

16) Expenses on fireworks and crackers were met by the bride's family and my AIADMK party men.

17)

18) There was no purchase of any furniture for the marriage. The furniture hire charges for the marriage were borne by the bride's family. The furniture hire charges for the reception on the 10th September amounted to Rs.57,250/- and were paid by me to Giri's Museum, Madras by cheque No.597109 drawn on Canara Bank, Mylapore.

19)

20)

21) I have not received any gifts on the occasion of the marriage of my foster son.

22) The other items of expenditure incurred by me through my account with Canara Bank, Mylapore in connection with the marriage are:

i) Pandal for the reception Rs.75,000/- paid to Mr. Kumaresan Nadar by cheque No.597110 on Canara Bank, Mylapore.

ii) Interior Decorations on the 10th September, 1995

a) Serial lighting Rs.25,000/- paid to Mr. Chadrasekaran by cheque No.597111 on Canara Bank, Mylapore.

b) Labour paid to Mr. Punindra Pal of Ahmedabad Rs.1,00,000/- vide cheque No.597106 on Canara Bank, Mylapore.

iii) For the pandal at the entrance of my residence a sum of Rs. 27,256/- was paid to Mr. Kumaresan Nadar by cheque No.597113 on Canara Bank, Mylapore.

iv) Thanks advertisement in Daily Thanti through Rock Aads. Madras-14, Rs.2,47,616/- paid by cheque No.597104 on Canara Bank, Mylapore.

v) Towards rent and amenities for film city, the reception Avenue, a sum of Rs.49,500/- was paid to Tamil Nadu Film Corporation, Ltd., Madras-600 113 by cheque No.597101 drawn on Canara Bank, Mylapore.

vi) Towards rice in respect of food for reception, a sum of Rs.23,800/- was paid to M. Abbas, Vikravandi-605652 vide cheque No.597112 drawn on Canara Bank, Mylapore. The other expenses relating to the reception were met by Mrs. N Sasikala.

23) Expenses in connection with simple betrothal function held in June 1995 at the residence of Dr. Sivaji Ganesan were met by the Bride's family. The following gifts to the bride were made by me:

The computation of the marriage expenditure items are as under:

Printing of invitations, identity cards, 12,00,050.00 car passes and printed polythene bags Distribution Expenses 2,45,000.00 Provision of food and refreshment 23,800.00 Accommodation for the invitees 1,75,246.00 Car hire charges 78,430.00 Dresses, clothes and other textile items for the marriage 4,84,712.00 Photograph expenses 54,660.00 Furniture hire charges 57,250.00 Pandal for the reception 75,000.00 Serial lighting 25,000.00 Labour charges 1,00,000.00 Pandal at the entrance of the 27,256.00 residence Thanks Advertisements 2,47,616.00 Rent and amenities for the Film City 49,500.00 Rice in respect of food for reception 23,800.00 Total 28,67,520.00 PW.237 - S.S.Jawahar was working as Assistant Secretary to the Chief Minister. Accused Nos. 2 and 3 were staying in Chief Minister's House. Mr. Sudhakaran's marriage took place in the year 1995. Grand daughter of Shivaji Ganeshan was engaged to get married to him. Marriage reception, musical concerts of Mandolin Srinivas and A.R. Rahman was conducted. Moulis Agencies Company printed the wedding invitations. He pasted the slip of address of 400 VIPs on the invitations who were Chief Ministers of many States. Many cooks came from Thanjavur to cook food for the marriage. He has seen 4th Accused Ilavarasi in poes garden.

In respect of Marriage Expenses, the following defence witnesses were examined, they speak as under:

DW.1 - Ramkumar has deposed that his father's name is Shivaji Ganesan. The third Accused is his elder sister Shanthi's Son-in-law. On 7.9.1995, his elder sister daughter Sathyalakshmi married to the third Accused in MRC Nagar, Chennai. His father-in-law was alive. They met the entire expenses of the marriage as they are bride's family. For that marriage, they opened an account in SB A/c. No.95071 in Gopalapuram Branch, State Bank of India and remitted upto Rs.92 lakhs which was spent on wedding expenses. Ex.P15 is Photostat copy of the savings bank account pass book.

During his cross examination, he states that during his sister's daughter marriage, he lived with his father. SB Account was opened on 14.8.95. The account details do not disclose that the amounts were spent for the marriage. His elder sister Shanthi's husband name is Narayanaswamy. He was working as a Professor in IIT, Chennai. During investigation he gave details relating to the marriage expenses.

DW.21 - S. Selvamhas deposed that in connection with marriage of Accused No.3, they collected Rs.50,000/- and spent the same on banners, decoration, flags and arch for the procession. He has given written explanation to the Income Tax Department. Rs.50,000/- includes his contribution and also contribution made by others.

DW.22 - R. Ramalingam has deposed that in connection with the marriage, they made arrangement for decoration of the procession route in their area and for that he collected collection to the tune of Rs.1.50 lakhs and handed over the same to K.R.V.Ramani of Milapur Constituency of AIADMK. Income tax Officer enquired him.

DW.23 - C.N. Swamy has deposed that they collected Rs.15,000/- from each area for the purpose of marriage of Accused No.3. He contributed Rs.10,000/- for the above purpose and remaining Rs.15,000/- was collected in his area. They all spent about Rs.70,000/- towards crackers and music band. He collected a cheque for the said amount from DW.1 - Ramkumar.

DW.24 - Thotta Tharani has deposed that he is a painter and Art Director for films. AIADMK party persons approached him for designing the façade of marriage hall entrance. He knew Shivaji Ganesan's family from his childhood. Hence he agreed to design the façade of the marriage on the entrance. He made a sketch in this connection. He was not involved in execution of the above façade designed by him. He entrusted the work to one of his Assistants by name Ramesh. He did not take any remuneration for the said art designing. He gave explanation before the Income Tax Department.

DW.25 - K. Thangamuthu was a Member of AIADMK Party. In 1995, he was the District Secretary of Thanjavur, District Unit of AIADMK Party. He has deposed that he along with others arranged procuring rice and vegetables. He arranged two cooks. Plantation leaves grown in his land were supplied for the above occasion. Subramanyam, Paramashivam and Dandayudapani were three others involved in procuring rice and vegetables. Jayaraman and Shankar are the two cooks who prepared food items. He paid Rs.17,000/- each. He has given statement before the Income Tax Officer. Breakfast was arranged by the bride's side.

DW.26 - Kanchi Pannerselvam has deposed that they were told marriage pandal would be put up by bride side. They decided to put the façade of the marriage pandal. The actual cost of execution of the package is Rs.57,02,050/-. He gave list of persons who contributed money for execution of the work.

DW.27 - Rathinavel has deposed that he along with 11 others arranged the facade of marriage pandal. Work was done by Ramesh. He paid Rs.5 lakhs. Said amount was collected from party workers in the District. He prepared list of persons who contributed money for the above works along with their names and addresses. The above work relating to façade marriage pandal was done by him and others voluntarily.

DW.28 - Pandurangan has deposed that about 12 of them went to their respective Districts and collected money from party workers. It amounted to Rs.5 lakhs and they contributed to the same for the work of façade of marriage pandal.

DW.29 - Muttumani has deposed that 12 persons decided to contribute Rs.5 lakhs of the various labour unions of Transport Corporations and selected ten Unions and intimated about the decision of putting up facade of marriage pandal. He requested Rs.50,000/- each for the above purpose thereby Rs.5 lakhs was collected by the above Unions and said amount was handed over to Kanchi Panner Selvam who in turn gave it to Ramesh for execution of the work. The Union collected voluntary contributions of their Members. Income tax officials issued notice. 12 persons prepared a joint petition and submitted to the Deputy Commissioner of Income Tax. No one asked them to do the work relating to the facade of the marriage pandal and they did that voluntarily.

DW.30 - K.P. Raju speaks about contribution made towards marriage of Accused No.3. He has deposed that they wanted to do something for marriage of Accused No.3. They wanted to put up a pandal for the marriage. When they verified, they were told that the marriage pandal will be put up by bride's party. Thereafter, 12 of them decided to put the façade for the said marriage pandal and collected Rs.5 lakhs by way of contribution and gave that money to Kanchi Paneer Selvam. Nobody has asked them to put up façade for the pandal and they did that on their own.

DW.41 -K.Seetharaman has deposed that he is a member of AIADMK Party since 1980-1981. He was a treasurer for Mylapur Area of AIADMK Party. They came to know that A1 attended the marriage of A3-V.N. Sudhakaran. They made decorations for the procession route. He along with other office bearers collected about Rs.50,000/- and handed it over to K.R.V. Ramani, who was the AIADMK Party's Area Secretary for Mylapur Area in Chennai. He personally contributed Rs.5,000/-. MRC Nagar is situated within Mylapur Area in Chennai.

During the cross-examination, he has stated that they did not prepare the list of contributors. They did not issue the receipts to the contributors for the amounts collected from them. He does not remember the number of persons who made the contributions to the tune of Rs.50,000/-. The said collections made were handed over to K.R.V. Ramani about 15 to 20 days prior to the marriage of A3.

DW.42 - P.S. Annamalai has deposed that he is a member of AIADMK Party which was formed in the year 1972 by late M.G. Ramachandran. He agreed to collect Rs.2,00,000/- towards arrangements to be made to receive A1 on the occasion of the above marriage in that area. The procession was decorated in that area. In this connection, he received a Notice from Income Tax Department enquiring him about the said Rs.2,00,000/-. He sent reply to that notice. Nobody asked them to make the above arrangements. As a member holding responsible position in the party, he felt that it was his duty to make such arrangements during visits by A1. He did not prepare the list of contributors from whom contributions were collected by him. He did not issue any receipts to those contributors.

DW.43 -V. Kothandaraman has deposed that MRC Nagar is situated in Mylapur Legislative Constituency. KRV Ramani was the AIADMK's Party's Secretary for Mylapur Constituency. The secretary of the above area was responsible to oversee the decoration arrangements. It was customary to make collections and hand over the amount to the concerned area secretary. They collected Rs.1,00,000/- from the party workers, members and the office bearers of the Annanagar Area and handed over the same to KRV Ramani. Income Tax department has issued the notice. He has submitted reply to that notice.

DW.77-K.R.V Ramani, Secretary for AIADMK Party of Mylapur Legislative constituency, made arrangements for the public procession in connection with the marriage of A- 3 - V.N.Sudhakaran. Various constituencies' secretaries of party made contribution to the tune of Rs.15,10,000/-. The Income Tax Authority issued notice as per Ex.D136 and he gave reply to the notice as per Ex.D137. He collected the contribution in connection with the marriage.

PW.181 - Thangarajan, Assistant Engineer, Building Construction-3, Sub-division-II, Chennai, has estimated the expenses incurred at the wedding and reception. The Architect - Vijayshankar has furnished the drawing of choultry. He has deposed that as per Ex.P1019, expenses for the pillar, colour lights, stages, decorative arches erected during reception at film city and wedding at MRC Nagar amounted to Rs.3,65,00,000/-. The total estimate was calculated at Rs.5,91,000/- which does not include meals, tiffin, dinner of the pre-wedding day, drinking water, crackers, tonga, elephant, horse, chariot, video, TV's folk dance, Bharatanatyam, Music performance.

In his cross-examination, he states that he prepared the estimate based on sketch. Nobody has sent him an invitation for the wedding. He has not attended the wedding. This witness has clearly stated in his evidence that he has not personally seen or observed the wedding. Second hand evidence is excluded owing to its infirmity as compared with its original source. Atleast to corroborate his evidence, no eye witness or the person who have attended the marriage have been examined. No priest, who performed the marriage have been examined. The contractor or the person, who installed the pandal have not been examined. Normally, the person who saw or heard is the proper person to explain about the installation of pandals, platforms etc. As stated earlier, no such persons have been examined.

PW.189 - Mahalingam states that he has sent invitations of about 56,000 and he has received the cost of Rs.2,24,000/- from PW.237 - Jawahar. PW.191 - Srinivasan has deposed that he declined to take money for the music concert. PW.196 - Aijaz Ahamed has deposed that he stitched the apparels of V.N.Sudhakaran and has received a sum of Rs.1,41,025/- from DW.1 - Ramkumar for stitching charges. PW.200 - K.P.Muthuswamy, Retired Chief Engineer has deposed that Vijayashankar, Architect furnished him a plan for pandal and stage arrangements. Contractors carried-out the work. Bride's father Mr.Narayanaswamy gave him a total sum of Rs.16,00,000/-. DW.1 gave Rs.3,00,000/- to Gopinath, Rs.1,75,000/- to Pauldasan and Rs.10,000/- to K.V.Natarajan. PW.214 - A.R.Rahman has deposed that he has performed music programme without charging any amount. PW.224 - Thyagaraja Swami has deposed that he cooked food for VIPs during marriage. A person from Shivaji Films gave Rs.11,850/- towards cooking charges. PW.228 - Rajasekaran speaks about expenditure of marriage. The Income-tax department has sent a questionnaire to A-1 - Selvi Jayalalitha. She replied for the same. According to her computation towards marriage, she has stated in her reply that she has spent about Rs.28,67,520/-. PW.237 - Jawahar was the Assistant Secretary to Chief Minister has deposed that Mouli's Agencies printed the wedding invitation card. He has sent 400 invitation cards to VIPs. Many cooks came from Tanjavur to cook the food for the marriage.

DW.1 - Ramkumar, Son of Shivaji Ganesan has deposed that he has remitted about Rs.92,00,000/- towards wedding expenses. DW.21 - S.Selvam gave explanation to the Income-tax department stating that Rs.50,000/- was collected and spent on banners, decoration, flags and arches. DW.22 - R. Ramalingam has deposed that he has collected Rs.1,50,000/- and handed over to K.R.V.Ramani. DW.23 - C.N.Swamy has deposed that he contributed about Rs.10,000/- for wedding and they all spent about Rs.70,000/- towards crackers and music band. DW.24 - Thotta Tharani, Art Director for films has deposed that he has designed the façade of marriage and did not take any remuneration. DW.25 - K.Thangamuthu has deposed that he has procured rice and vegetables and arranged cooks. Plantation leave grown in his land were used for the wedding. He paid Rs.17,000/-. Breakfast was arranged by bride's side. DW.26 - Kanchi Pannerselvam has deposed that marriage pandal was installed by bride's side. DW.27 - Rathinavel has deposed that amount of Rs.5,00,000/- was collected from party workers to install façade of marriage. DW.28 - Pandurangan has deposed that he has collected a sum of Rs.5,00,000/- from 12 persons for the marriage purpose. DW.29 - Muttumani has deposed that he has collected a sum of Rs.5,00,000/- from 12 persons of the Labour Union of Transport Corporation. 12 persons gave joint petition to the Deputy Commissioner, Income-tax. They have done this voluntarily. DW.30 - K.P.Raju has deposed that he has contributed Rs.12,00,000/- after collecting the same from 12 different persons. DW.41 - K.Seetharaman, Treasurer for Mylapur Area of AIADMK Party, has deposed that he himself and other office bearers have collected Rs.50,000/- and handed over the K.R.V.Ramani and Party Area Secretary for Mylapur. Similarly, DW.42 - P.S.Annamalai, DW.43 - V.Kothandaraman and DW.77 - K.R.V.Ramani have deposed that they all are members of All India Anna DMK Party and they were contributed money to the expenses of the marriage of A-3 - V.N.Sudhakaran.

Accused No.1 was a Chief Minister of Tamilnadu. When marriage of A-3 was performed, she was also the General Secretary of All India Anna DMK Party. Her role was in dual capacity. Bride was none other than the grand daughter of the famous Cine Actor Shivaji Ganesan. DW.1

- Ramkumar has stated in his evidence that he has spent about Rs.92,00,000/- for the performance of the marriage. He was also produced the extract of SB Account No.95071, State Bank of India, Gopalpuram Branch. The material witness - the father of the bride, Narayanaswamy has not been examined. He was a proper person to speak about the marriage expenses of his daughter. The prosecution has not been examined him. No plausible explanation is forthcoming as to why he was not examined. He was working as a Professor in Indian Institute of Technology, Chennai. The material evidence has been withheld by the prosecution. The prosecution's case is that accused No.1 has spent all the expenses pertaining to marriage. The version of accused No.1 is that she has spent about Rs.28,67,520/- for the marriage. It is a customary practice that normally expenses of the marriage will be borne by the bride's family. Even the bride's family are also financially sound. The expenditure relating to marriage will be of both verifiable expenditure and non- verifiable expenditure. Verifiable expenditure can be ascertained by investigation. It is difficult to ascertain non-verifiable expenditure. In this case, the bride's family have stated that they incurred expenditure pertaining to marriage. A-1 was a General Secretary of AIADMK Party. There is a positive evidence that members of the All India Anna DMK Party also made some arrangements for the marriage and they themselves have claimed that they have spent some amount towards the marriage, voluntarily. In the absence of the evidence of the bride's father, A-1 has furnished a statement before the Income- tax department to their questionnaire stating that she has spent Rs.28,67,520/- towards the marriage, party workers spending some amount towards marriage, I am of the opinion that the liability of the marriage of A-3 by A-1 to A-4 is to the extent of Rs.28,68,000/-.

Learned Special Public Prosecutor, Sri. B.V. Acharya, in his written arguments has mentioned that Accused Nos. 1 to 4, firms have acquired about 306 properties. Evidence, material placed on record disclose that the value of the properties range from Rupees Ten Thousand to Lakhs. But, Accused Nos. 1 to 4, firms and companies have borrowed loan more than Rs.24 Crores. This loan has been utilized for acquiring the immovable properties, namely, agricultural lands, sites etc. Borrowing loan from the Nationalized Banks and acquiring the properties is not an unlawful activity.

The Director of Vigilance and Anti Corruption has inflated the value of assets to the extent of Rs.91,34,568/- Since these assets have been inflated by the Director of Vigilance and Anti Corruption, some of the items left out while valuing the construction will be adjusted.

Learned Special Public Prosecutor, Sri. B.V. Acharya, submits that the sole prosecuting agency is State of Karnataka in the appeals and the prosecutor validly appointed by the State of Karnataka has to be heard. In the present appeals, State of Karnataka which is a sole prosecuting agency has not been made as a party.

Though this appeal was heard for nearly more than four months, inspite of it, the Government of Karnataka has not taken steps either to appoint Special Public Prosecutor even though the State of Karnataka was a transferee court. This case arises out of private complaint and subsequently even Director of Vigilance and Anti Corruption registered a crime in Tamil Nadu during the course of the trial which was conducted in Tamil Nadu. At that stage, this matter was transferred from the High Court judicature of Madras to the High Court of Karnataka so that trial of the case may be conducted fairly. Since this criminal case was transferred from Tamil Nadu, the transferee State is the party. That being the case, as soon as criminal case was disposed of by the learned Special Judge, criminal appeals were preferred by the Accused before this Court. At that time, only State of Karnataka should have been diligent in appointing Special Public Prosecutor, but it has not done so. Even at the stage of hearing of the appeal for nearly four months, State of Karnataka has not taken steps to appoint Special Public Prosecutor to conduct the proceedings. On the other hand, contention of the State of Karnataka is that they are not made as parties. There was an observation by this Court for the appearance of the learned Advocate General. Accordingly, he appeared before the Court and made submission that he will give accommodation to the Special Public Prosecutor Sri.Bhavani Singh. Even during that time, the learned Advocate General did not mention about the accused not making Government of Karnataka as a party. On the other hand, Sri.B.V.Acharya, learned Special Public Prosecutor has urged the contention that the appeal is not maintainable, since the Government of Karnataka is not made as a party. When the State of Karnataka is aware of hearing of these appeals and daily media reports about this case, pleading ignorance by the State of Karnataka and taking up contention that it is not maintainable is not sustainable. Besides, it is a curable irregularity which can be cured at any stage. In that view of the matter, contention of learned Special Public Prosecutor that the appeals are not maintainable has no force and cannot be accepted.

One of the contentions raised by learned Special Public Prosecutor is with regard to criminal conspiracy and acquisition of assets. In this regard, prosecution relies on evidence of PW.94 - R.Lakshminarayanan who speaks about registration of firms and companies and PW.159- Rajagopalan who speaks about registration of documents at the residence of Accused No.1 at Chennai. According to the prosecution, this part of the case has been satisfactory established by leading clinching substantial evidence.

It is not prudent to expect direct evidence in this aspect and the same is only by way of substantial evidence. Accused Nos. 1 to 4 were residing together at Poes Garden. No doubt, it is the contention of learned Special Public Prosecutor that since the registration was done at the residence of Accused No.1 and Accused Nos. 1 to 4 were residing together in the same residential premises, registration of documents at the residence is not illegal. Contention at paragraph-20 of the written arguments indicates more than Rs.20 Crores have been paid towards price of these properties is not borne out from the records or evidence. Contention of learned Senior Counsel that more than Rs.20 Crores immovable properties have been purchased and sale deeds has been executed has no force since it is the borne out from the records that total amount mentioned in the sale deeds is about Rs.6,24,09,120/-. Therefore, there is no force in the contention of learned Senior Counsel.

In so far as marriage expenses are concerned, learned Senior Counsel supports the impugned Judgment and submits that the trial court has validly reduced the expenses to the extent of Rs.3 Crores.

This court after examining evidence and also documents has come to the conclusion that Accused No.1 cannot be saddled with the entire marriage expenses. As stated earlier, according to Hindu Customs, it is bride's father and their family members who perform the marriage and they bear the marriage expenses. Besides, there will be non verifiable expenditure. Such being the case, it is difficult to accept submission of learned Senior Counsel in this aspect.

Though it is contended by learned Senior Counsel that income of Accused is Rs.9,34,26,053.56/-, but from the evidence available and material on record, it is crystal clear that Accused Nos. 1 to 4, firms and companies have borrowed loans to the tune of Rs.24,17,31,274/-. Such being the case, this amount has lost sight of by the prosecution. The Investigating Agency has also not investigated in this regard. It appears that the Investigating Agency has deliberately omitted to investigate in this aspect and narrate the same in the police papers. Therefore, the contention of learned Senior Counsel for the State with regard to the income of the Accused has no force and the same cannot be accepted.

The written arguments filed by third party Intervenor only relies upon evidence of the prosecution witnesses and also supports the impugned Judgment of the Trial Court and also they have given tabular form with regard to additional construction and they point out certain irregularities while registering the documents and also under valuation. This aspect will be taken care of by the concerned authorities under the law relating to this rather than the provision of offence of criminal misconduct. This irregularity or discrepancy cannot lend support to the offence of criminal misconduct envisaged under section 13[1][e] of the Prevention of Corruption Act.

Sri.B.V.Acharya, learned Special Public Prosecutor relied on PW.159, who speaks about the registration of 90 documents. The consideration amount of these sale deeds works out approximately to Rs.3,20,72,380/-. No doubt, the Sub-Registrar - PW.159 has visited the house of A-1 for registering the properties nearly 20-25 times. Just because, PW.159 visits the house of A-1 in connection with registering the properties, that itself is not a material to bring home the guilt of the accused. Law permits the Sub- Registrar to visit the residential houses to register the documents. Even if there is an undervaluation, the concerned department has to take action under the law relating to undervaluation. Even if there is non-compliance of Income Tax Act of furnishing Tax Clearance Certificate, the concerned Income Tax Authorities will initiate action against the concerned. These things cannot be taken into consideration for bringing home of the offence of criminal misconduct. In this case, there is a positive evidence to the effect that Rs.24,17,31,274/- has been borrowed loans from the Nationalised Banks by A-1 to A-4, Firms and Companies. This is a lawful source of income. From the evidence on record, it reveals that this amount has been utilized for acquiring the immovable properties. There is no evidence to show that ill-gotten wealth of A-1 has been parted to A-2 to A-4, Firms and Companies to acquire these immovable properties. The prosecution has not shown the loan borrowed by accused Nos.1 to 4, Firms and Companies. Therefore, the prosecution has not established the offence of abetment and criminal conspiracy. LOANS AS INCOME PW.259 has positively stated in his evidence that accused Nos.1 to 4 and firms and companies have borrowed huge loans. Even I have carefully examined the documents and it is found that evidence of one PW.182 - Arunachalam reveals that Accused Nos. 1 to 4 and firms and have borrowed Rs.7,35,46,000/-. Besides, Accused have also borrowed loan from private parties. Those loans have not been taken into consideration. Ex.D196 discloses that Indian Bank has granted loan of Rs.84,07,172/-. The assessee advanced loan of Rs.58,66,500/-. The following are loans availed from Accused and firms and companies.

Indo Doha Company was advanced loan of Rs.1 Crore from Magantha Investments.

PW.211 - P.N. Venkatesh speaks about Rs.34 lakhs loan to Accused No.4. PW.160 speaks about grant loan of Rs.1.50 Crores sanctioned to Jaya Publications. PW.176 speaks about grant loan of Rs.1.50 Crores from Indian Bank to Tansi Enterprises. PW.182 also speaks about sanction of loan. However, I have considered the loan only borrowed by the Nationalized Banks. The loan borrowed by the Accused Nos. 1 to 4 and firms companies are as under:

1 Ex.P1027 OMTL-Indian Bank, Rs.1,50,00,000.00 Jaya Publications 2 Ex.P1101 Agricultural M.D.Loan, Indian Bank, Guna Bhushani. On request of Guna Bhushani, they Rs.3,75,00,000.00 changed the loan liability to A2, A3 and A4 since they became the share holders.

3 Ex.P1114 Indian Bank- A1 Rs. 90,00,000.00 4 Ex.P1162 Indian Bank J.Real Rs. 25,00,000.00 Estate 5 Ex.P1172 Indian Bank Rs. 12,46,000.00 J.S.Housing 6 Ex.P1211 Indian Bank, J farm Rs. 50,00,000.00 house 7 Ex.P1260 Indian Bank- Sasikala Rs. 25,00,000.00 8 Ex.P1330 Indian Bank- Rs.1,57,00,000.00 V.N.Sudhakaran 9 Ex.P1354 Ramaraj Agro Mill Ltd Rs.1,65,00,000.00 Ex.P1357 Indian Bank- Rs. 17,85,274.00 10 Mahalakshmi Kalyanamandapa Total Rs.24,17,31,274.00 Out of the loan amount of Rs.24,17,31,274/-, a sum of Rs.5,99,85,274/- is deducted to the income assessed by Director of Vigilance and Anti Corruption. After deducting this amount, the balance loan amount remains as Rs.18,17,46,000/-.

INCOME FROM GRAPE GARDEN:

In so far as the income from the Grape Garden is concerned, no doubt Income tax returns have been filed belatedly, but that itself will not be a ground to reject the income from the Grape Garden. Even in the earlier returns, income from the Grape Garden has been mentioned. Though the prosecution disputes about the income from the Grape Garden, Income Tax returns filed by the assessee and also after a detailed enquiry by the Income Tax Authority have come to a conclusion that there is an income from the Grape Garden to the extent of Rs.52,50,000/-. A portion of the income has been included in the Annexures filed along with the charge sheet, deducting that amount from the agricultural income/Grape Garden is Rs.46,71,600/-. GIFTS AS INCOME:

In so far as gift items are concerned, the Accused No.1 has claimed that she has received a sum of Rs.2,15,00,000/-. Accused No.1 has performed marriage of her foster son Accused No.3 and during her birthday she received gifts from the party workers, friends, well wishers etc. She has also filed income tax returns to that effect before the Income Tax Authorities. No doubt, there is delay in submitting the income tax returns. That has been accepted by the Income tax authorities. Besides, there was a marriage function of foster son of Accused No.1 and also her birthday. In Tamilnadu, there is practice of giving gifts to political leaders on their birthdays. She has also claimed foreign remittance of Rs.77 lakhs. Taking into consideration all these aspects, in my view, the income that arises from the gifts in my estimation will be around Rs.1,50,00,000/-.

SASI ENTERPRISES PW.113 has spoken about the rent derived from the shops given on rent from Sasi Enterprises.

Sasi Enterprises carried out fax, Xerox, STD, printing of building plan works. Ex.D258 is attested copy of lease agreement dated 1.9.1991 between Sasi Enterprises and said TSR Vasudevan.

In Ex.D261 a sum of Rs.17,91,000/- is shown as loans and advances due to M/s. Sasi Enterprises. Ex.D261 discloses that a sum of Rs.8,20,000/- was due from one Nagammal, a sum of Rs.2,75,000/- was due from one Subramaniam. Sasi Enterprises leased shops bearing Nos. 9 and 20 in Khadar Nawaz Khan Road, Chennai in favour of M/s. Info Tech Computer Centre. Ex.D263 shows agricultural income of M/s. Sasi Enterprises of Rs.5,40,700/-.

Ex.D259 is copy of certificate issued by the Tahsildar of Villupuram to the effect that the lands mentioned therein were held by Accused No.2 Sasikala as lessee. Sasi Enterprises received an amount of Rs.54,000/- as advance. Ex.D265 is attested copy of letter dated 26.12.2001 addressed by one A. Bhaskaran of Kumbakonam to the Commissioner of Income Tax [Appeals] to the effect that a sum of Rs.40,000/- was paid as advance to M/s. Sasi Enterprises in respect of property at Maharkombu, Thanjavur. The said property is house property. Ex.D263 pertaining to M/s. Sasi Enterprises a sum of Rs.5,40,700/- is shown as agricultural income. The receipt of agricultural income by M/s. Sasi Enterprises have been accepted by the Income Tax Authorities as reflected in page 16 of the order Ex.D262. Ex.D261 pertaining to the year ending on 31.3.1991, a sum of Rs.8,20,000/- is shown as amount due from Mrs. Nagammal. M/s. Sasi Enterprises has received Rs.4,50,000/- towards repayment of loan from Mrs. Nagammal and this aspect has been accepted by IT Authorities in the order Ex.D262. M/s. Sasi Enterprises had filed IT returns along with balance sheet, profit and loss account for the year ending on 31.3.93. The Commissioner of Income Tax [Appeals] passed an order dated 28.5.2002. Ex.D267 is attested copy of the Balance Sheet along with profit and loss account of M/s. Sasi Enterprises. In this document, a sum of Rs.2,16,850/- is shown as agricultural income. Ex.D267 reveals that a sum of Rs.1,48,600/- has been received as rents. Ex.D269 is attested copy of the assessment order dated 19.3.1999. Ex.D268 is acknowledgement receipt given by IT Authorities for receipt of returns for the year 1993-94 along with statement of income and Balance Sheet. M/s. Sasi Enterprises has shown an amount of Rs.65,000/- as agricultural income derived out of 3 acres 23 cents of land in R.S. No.402/2 of Sundara Kottai Village in Mannargudi Taluk, Thanjavur District. A sum of Rs.1,41,400/- is derived as rental income from shops and house property. In the same document, annual income shown is Rs.1,94,806/-. Under the Statement of income, a sum of Rs.10,20,000/- is shown as income from capital gains, got by sale of erstwhile TANSI Enameled wire. The Assessing Authority has accepted the same and has issued assessment order Ex.D269 dated 19.3.1999.

Ex.D270 is attested copy of the acknowledgement issued by the Income Tax Department for the receipt of returns along with statement of income, balance sheet and profit and loss account for the year ending on 31.3.95 from M/s. Sasi Enterprises on 20.9.97. In the said statement of income, a sum of Rs.70,000/- is shown as agricultural income. Net profit shown is shown as Rs.44,895/-. A sum of Rs.1,69,600/- is shown as income from house property. Ex.D272 is attested copy of the acknowledgement issued by IT Authorities regarding receipt of returns along with statement of income, balance sheet and profit and loss statement. Statement relating to income of the year 1996- 97 includes a sum of Rs.80,000/- as agricultural income. Gross rental income received is shown as Rs.7,06,200/-. In the same statement of income, a sum of Rs.10 lakhs is shown as loan received by the assessee from Housing Real Estate Developers Pvt. Ltd.,. Ex.D274 is letter of confirmation of accounts issued to Sasi Enterprises by Housing Real Estate Developers Pvt. Ltd., for the period 1.4.97 to 31.3.98. In this document, amount due was Rs.10 lakhs. In the above statement, a sum of Rs.6 lakhs is shown as income received by way of sale proceeds of building materials pertaining to Industrial Estate, Guindy. In the balance sheet pertaining to Ex.D272, under the head 'unsecured loans', a sum of Rs.2 lakhs is shown as received from Lex Property Development Pvt. Ltd.,.

DW.88 states that he has independently done internal auditing work in respect of M/s. Sasi Enterprises, M/s. Anjaneya Printers and also Accused No.2 - Sasikala.

The Village Assistant of Poyapakkam has deposed that the alleged lease hold lands were not leased to anybody else but were cultivated by T.S.R. Vasudevan and his family. M/s. Sasi Enterprises was cultivating groundnut in 3 acres of land and vegetables and watermelon as main crops in 27.34 acres land. He has seen the original lease agreement dated. 1.9.91 between T.S.R. Vasudevan and M/s. Sasi Enterprises. But, original lease agreement was not available with him.

In the Balance Sheet at Ex.D263, for the year ending 31.3.92 of M/s. Sasi Enterprises the amount of Rs.5,40,700/- received by way of agricultural income is shown under the head 'liability'. In Ex.D267, balance sheet of M/s. Sasi Enterprises for the year ending 31.3.93, a sum of Rs.2,16,850/- is shown to have been received by way of agricultural income by the said firm. At the end of the year 1993, the amount of Rs.8,20,000/- which has been advanced to Nagammal had been repaid. The nature of business carried on by the Assessee M/s. Sasi Enterprises is mentioned as Xerox, job typing, fax, copier services. In. Ex. D268, a sum of Rs.10 lakhs is shown as loans received from Namadhu MGR newspaper and another amount of Rs.4 lakhs is shown as loan received from Vinod Video Vision. In Ex.D270 it is mentioned that an amount of Rs.23,80,000/- was received by way of advance for sale of property by M/s. Sasi Enterprises. For the year 1996- 97, Sasi Enterprises has mentioned its nature of business as Xerox, job typing, fax, copier services, trade service and mercantile export. In the receipt and payment account for the year ending 31.3.96, a sum of Rs.34,42,000/- is shown as loans received by M/s. Sasi Enterprises from the persons mentioned therein. Taking into consideration of evidence and material placed on record, income of M/s. Sasi Enterprises can be assessed at Rs.25,00,000/-.

JAYA PUBLICATIONS:

Jaya Publications carries on printing text books, publishing and also dealing with properties. It has filed the Income Tax returns as under:

INCOME STATEMENT OF JAYA PUBLICATIONS Sl. Ass. Yr. Exhibits Printing, Amount No. Publishing & [inRs.] dealing properties 1 1991-92 Ex.D218 Income tax 6,99,350 returns 2 1992-93 Ex.D219 Income tax 16,89,680 returns 3 1993-94 Ex.D220 Income tax 14,65,660 returns 4 1994-95 Ex.D221 Income tax 1,45,34,628 returns 5 1995-96 Ex.D222 Income tax 2,34,66,583 returns TOTAL 4,18,55,901 The above Income Tax returns were accepted. NAMADHU MGR:

Namadhu MGR relates to the subscription to receive a periodical or service regularly or order i.e. to subscribe to a newspaper to purchase future issues of periodical, list of contributors, an agreement to take and pay for such periodicals, books containing names of subscription with the amount of this subscription. When you subscribe, there will be some discounts. The subscription schemes are set-up for raising money. The payment or promise of payment for consecutive issues of magazine, newspaper, books etc. over a specified period of time.

Namadhu MGR is one of the components of the Jaya Publications. In this background, Namadhu MGR scheme was introduced in the year 1990, to improve the circulation of newspaper i.e. Subscription Deposit Scheme. This is one of component of Jaya Publications.

DW.88 - K.Soundravelan, Chartered Accountant speaks about this scheme. He has deposed that there was an option of depositing an amount ranging from Rs.12,000/- - Rs.15,000/- - Rs.18,000/-. There were about 9,000 subscribers. Depending upon the amount of deposit of the subscribers, they will get 4, 5 or 6 free copies of newspaper every day. The concerned subscriber could get the deposit amount by giving 15 days prior notice. There was a scrutiny of the account of the assessee - Jaya Publication for the years 1991 to 1996. I.T. authorities had required the assessee to produce the list of the subscribers of the above mentioned deposit scheme. The said lists were produced by the assessee. I.T. authorities segregated the names of the assessees district wise and sent the district wise list to the respective district I.T. authorities for verification. In turn, the respective Income Tax Officers of the District summoned the subscribers and recorded their statements.

DW.88 has deposed that the accused have produced list of subscribers of deposit with their names and address and also the amounts subscribed for the assessment years 1991-92, 1992-93, 1993-94, 1994-95, 1995-96, 1996-97. The said list comprises of six books and they are at Ex.D229(1) to Ex.D229(6). The assessing officer did not accept the returns filed by the accused. Feeling aggrieved by the same, the accused - assessee preferred appeals before the Commissioner of Income Tax Appeal, Central - II in I.T. Appeal No.144/2001-02. The Appellate Authority accepted the case of the assessee regarding the scheme deposit collection as per Ex.D232 - Order, dated 28.3.2002. This Ex.D232 relates to the Assessment year 1991-92. Similarly, Assessing Officer rejected the claim of the assessee, against that order, the assessee preferred I.T. Appeal No.142/2001-02 before the Commissioner of Income Tax Appeal, Circle-II. Similarly, Assessment Officer rejected the returns of the assessee of the assessment years 1994-95 to 1996-97. The Assessing Officer partially allowed the claim made by the assessee in respect of the Deposit Scheme. Feeling aggrieved by the partial allowance of the claim in respect of Deposit Scheme, appeal was preferred before the Commissioner of Income Tax Appeal. The Commissioner of Income Tax Appeal partially accepted the claim of the assessee. As against this order, further appeal was preferred before the Income Tax Appellate Tribunal - B Bench. The Appellate Tribunal passed common order accepting the claim of the assessee regarding the Deposit Scheme except in respect of 41 depositors. The total amount received by Jaya Publication under the above Deposit Scheme from its subscribers is Rs.14,23,89,000/-. 16,000 copies of newspapers per day were printed in the year 1998. 30,000 copies of newspapers per day were printed in the year 1990. 60,000 copies of newspapers per day were printed in the year 1995-96. 70,000 copies of newspapers per day were printed in the year 1996-97.

During the cross-examination of DW.88, he states that A-1 and A-2 became partners of M/s. Jaya Publication in the year 1990. A-2 was looking after the affairs of said firms. In between 1990 and 1992, A-1 executed the power of attorney dated 21.5.1992 in favour A-2 for looking after the business of Jaya Publications on her behalf. Jaya Publications did not obtain permission for introducing interest free Subscribers Deposit Scheme in respect of Namadhu MGR newspaper. The said scheme has not been registered with any authority. There is no such requirement. He has gone through the terms and conditions of that scheme. According to Condition No.2 of the scheme, subscriber/deposit would receive a free copy of Namadhu MGR newspaper, but not any interest on the deposited amount.

DW.88 at paragraph-47 in his evidence has stated that in the Order Ex.D217, there is no mention that representatives of M/s. Jaya Publications produced the books of account before the special auditors. There is an observation in the said order that during the said special audit to show receipts through Cash and Bank, but no supporting documents were made available. He said that on account of seizure of the documents of M/s.Jaya Publications by DV & AC those documents could not be made available before the special auditors. But in the order Ex.D217, there is no mention that the said documents could not be made available for the reason that they were seized by DV & AC. There is an observation made in the para.2 of Annexure-II to Ex.D217 that all payments made through cash are not supported by any outside document or evidence and that they are only supported by internally made vouchers with payee's signature. There is also a further observation in para.3 of said Annexure-II that payments above Rs.500/- are not stamped as required under Indian Stamp Act.

In Ex.D231 is an appeal directed against the assessment order dated 04.05.2001 passed by the Deputy Commissioner of Income Tax, Central Circle - II, Chennai, under Section 144 read with Section 251 of the Income Tax Act. The paragraphs 7.2 and 7.3 of the order of the Appellate Court reads as under:

"7.2. During the course of appellate proceedings before me, the learned counsel submitted that there were changes in the appointment of the authorized representatives. Till February 1998, M/s Rajasekar & Co., CAs were the appointed auditors for the appellant thereafter M/s. Shanmugham and Muthu, CAs were appointed auditors till they were replaced by M/s S. Venkatram & Co., CAs. Because of these frequent changes in the appointment of auditors, the correct data, on this issue, could not be collected and, therefore, this issue could not be represented properly in March, 1998, i.e., at the time of original assessment proceedings. The learned counsel further submitted that the Appellant has since reconciled the list of members of the scheme as on 31.3.1991, which consisted of 91 members from whom an aggregate amount of Rs.13,54,000/- were collected. The complete details and addresses of these 91 members were already stated to have been filed before the Assessing Officer during the re-assessment proceedings. As regards non-mentioning of the scheme deposit in the impounded books of accounts, the learned Counsel contended that the impounded books, on the basis of which the Assessing Officer concluded this issue, consisted only of pretty cash books of M/s Jaya Publications and M/s NAMADHU MGR; whereas the other records like bank which actually reflected the transactions of scheme deposit were not impounded. Thus, in his view, the impounded books in question were incomplete and consequently, the conclusion drawn on the set of incomplete books would not be correct.

However, during the re-assessment proceedings, the Appellant had produced the complete books of accounts, as is evident from the findings recorded by the Assessing Officer himself on page 20 of the assessment order, the relevant portion of which reads thus: In the balance sheet filed the amount of scheme deposit collected was claimed to be Rs.13,54,000/-. From the verification of the computerized bank books submitted it is seen that the credits representing alleged scheme deposit collection aggregate to Rs.13,11,200/- only. No explanation was given for the difference....' As regards non-production of the application forms, the Learned Counsel submitted that the application forms, counter- foils etc., kept in a cardboard box in Tata Sumo vehicle parked in a hotel was found missing and a complaint was lodged in the Police in this connection. He further submitted that since the original applications were lost, he produced Photostat copies of the same before the Assessing Officer. The Learned Counsel further contended that the Assessing Officer had thoroughly investigated the 'scheme deposit' while finalizing the assessments for the assessment years 1994- 95, 1996-97, 1997-98 and accepted the 'scheme' though certain disallowances were made for the reasons stated therein.

7.3. I have carefully considered the submissions made by the Appellant in the light of the facts and circumstances of the case as brought out in the assessment order. I have also perused the list of scheme deposit as on 31.3.1991 which contained 91 names of the subscribers and the details of dates on which their deposits were made. I have also gone through the bank books and the ledger folios detailing the transactions relating to the scheme deposit. The reasons for revising the claim of Rs.10,87,067/- to Rs.13,54,000/- frequent changes in the appointment of auditors from M/s Rajasekar &Co., CAs to M/s Shanmugam & Muthu, CAs to M/s S.Venkataram & Co., CAs- are found to be factually correct. Since these issues could not be represented properly for want of details during the original assessment proceedings, the assessments for the assessment years 1991-92 to 1993-94 were set-aside by the Commissioner of Income-tax (appeals) vide his Order dated: 15.09.1998. it is well settled that whether certain entries were made or not made, in a particular year of account is totally immaterial and such entries are not decisive or conclusive of the matter(Kedarnath Jute Mfg. Co. Ltd.'s case (1971) 82 ITR 363 (SC). It would appear that in accordance with this principle, the Appellant was within its rights to revise the claim from Rs.10,87,067/- to Rs.13,54,000/-. Further, the Learned Counsel never disputed the Assessing Officer's contention that the credits found in the impounded cash books were nothing but the sales and advertisements collection of one daily newspaper titled 'Namadhu MGR' but, as already observed, the transactions relating to scheme deposit were actually entered in the bank book, which was also produced before the Assessing Officer, as is evident from his own findings on page 20 of the assessment order. At the cost of repetition, the relevant portion is reproduced again: In the balance sheet filed the amount of scheme deposit collected was claimed to be Rs.13,54,000/-. From the verification of the computerized bank books submitted it is seen that the credits representing alleged scheme deposit collection aggregate to Rs.13,11,200/- only. No explanation was given for the difference. A careful reading of this finding shows that the Appellant had produced the relevant books of accounts in support of the revised claim. It is pertinent to mention here that when the Appellant had actually furnished letters from 417 subscribers confirming the deposits made by them, the Assessing Officer should have initiated further investigation process for verifying these deposits transactions, either through summons or through any other made of enquiry, as was done during the proceedings for the assessment years 1994-95, 1996-97 and 1997-98 earlier. Instead, he has chosen to treat the entire scheme deposit as an 'after- thought' which, in my opinion, was not a correct approach. As a matter of fact, scheme deposit is a common issue for all the assessment years from 1991-92 to 1998-99, and the appeals are pending before me for a decision. In order to adjudicate upon this issue, I had requisitioned the assessment records including the confidential folders (44 Nos.) containing details of investigations made by the Assessing Officer. In the context of assessment year 1996-97 wherein the Appellant had claimed to have collected scheme deposits to the extent of Rs.3,53,37,000/- from 2250 persons, it was found that 41 persons had denied of having contributed any amount towards the said scheme. The total amount of deposits claimed to have been collected from these 41 persons amounted to Rs.5,33,000/- out of the total claim of scheme deposits amounting to Rs.3,53,37,000/. In terms of percentage, it worked out to 1.5%. In fact, the Assessing Officer, Shri. G. Gurusamy, assisted me in analyzing the relevant facts. Having regard to the facts and circumstances as brought out in the assessment order and keeping in view the percentage of denials to the extent of 1.5%, I deem it appropriate to apply the same percentage for the disallowances i.e., 1.5% on the total claim of Rs.13,54,000/- which works out to Rs.20,310/- or around sum of Rs.25,000/-. The Assessing Officer is directed to substitute Rs.25,000/- in place of Rs.13,54,000/-. In the result, the Appellant gets a relief of Rs.13,29,000/- (Rs.13,54,000/- minus Rs.25,000/-)".

DW.88 also states in his evidence that in para 11.0 found in page No.25 of the Order - Ex.D233, there is an observation that the learned counsel representing the assessee inform the Assessing Officer vide his letter dated 23.3.2001 that original lease agreement kept in cardboard bags in Tata-Sumo vehicle parked in a hotel was found missing and a complaint was lodged with the police in that connection.He cannot say as to how many of 9,000 subscription deposit of subscribers of Namadhu MGR Subscription Deposit Scheme, has subscribed Rs.18,000/-. If he can verify the records and count then he will be in a position to tell the number of such depositors and this would take considerable time. He had seen all the said 9,000 applications of the subscribers of the said scheme. He has not put his initials on the said applications to indicate that to he has verified each of those applications. He denies the suggestion put to him, out of 9,000 applications, more than 5,000 applications were incomplete. In the application bearing Serial No.144 and Reference No.207 stated to be that of S.Mada Swamy, now shown to him the place and signature are not visible. He said that this is so on account of passage of time. In the application of one J.Padmanabhan at Sl.No.109, there is a mention of date and signature of the applicant but column meant for mentioning the place is left blank. NAMADHU MGR - DIVISION OF JAYA PUBLICATION Evidence referred is DW.88 - K.Soundravelan, Chartered Accountant.

As against this, the matter was taken to the High Court of Madras, the same is under the judicial consideration.

In so far as the income of the Namadhu MGR - a component of the Jaya Publications is concerned, there is a positive evidence to the effect that Income Tax returns have been filed very belatedly. No plausible explanation is forthcoming from the assessee as to why there is delay in filing returns. Under the Tax Laws, the burden is on the assessee to explain the true nature and source of the income. The assessee has to prove that a particular income has its origin in the capital amount. Where remittances were made from non-taxable territory and the Income Tax Department established the source, the presumption that remittances are out of accumulated profits arises. Regarding the question as to where from remittances are made being a matter within the special knowledge of the assessee, he has to prove that those remittances are from source other than accumulated profits. When the assessee fails to explain the nature of cash credit entry, the income tax officer may presume that it falls under income from other sources. The burden of establishing that a disputed amount is not assessee's income lies on the assessee and not on the department. When an assessee claims exemption he should give detailed facts entitling him to exemption as under Section 106, when any fact is specially within the knowledge of any person, the burden of proving that fact is upon him.

In this case, the Chartered Accountant - DW.88 speaks about the income of the assessee. It is undisputed fact that A-1 and A-2 are partners of Jaya Publications. Namadhu MGR - newspaper is one of the component of Jaya Publications. In this case, accused Nos.1 and 2 have not entered the witness box, even though they claim the income from the subscription of the subscribers to the extent of more than Rs.14 Crores. Besides, there is a discrepancy in the evidence of DW.88. At one point of time, assessee takes a contention that the applications relating to deposit scheme were missing and a complaint was lodged to that effect. Subsequently, in this case, applications were marked, which were presented before the Income Tax Department. As stated earlier, there is a delay in filing the returns. It is contention of the learned counsel for the respondents - prosecution and the General Secretary, DMK Party that this claim is fictitious claim and it is an afterthought.

When Income Tax returns have not been filed for many years, it disentitles the assessee substantially. A doubt arises in the genuineness of the Income Tax returns. But when it is produced before the Income Tax department after a long time and is not produced when its production was warranted, it is a suspicious circumstance against the genuineness of the claim of the assessee in respect of this subscription item i.e. Namadhu MGR. However, in the instant case, DWs.3, 4, 5, 6 , 31, 32, 33, 34, 35, 36, 37, 38, 39, 40, 44, 45, 46, 47, 48, 49, 50, 51, 52, 53, 54, 55, 56, 57, 58, 59, 60, 61, 62, 63, speak about the deposit of amount ranging from Rs.12,000/- to Rs.18,000/- for issue of Namadhu MGR newspaper. They also state that they have presented the applications before the Jaya Publications. Taking into consideration of the evidence of defence witnesses mentioned hereinabove, even if there is a delay in filing the Income Tax returns, this cannot be a factor to reject the whole claim of the assessee. The evidence adduced by the defence will have some force. This aspect has to be taken into consideration while assessing the income spoken by the defence side. Jaya Publications' activities are Printing text books, Publishing, Real Estate and Namadhu MGR - newspapers, in my view, a sum of Rs.4,00,00,000/- has to be taken as an income earned by Jaya Publications.

SUPER DUPER TV PVT. LTD.:

This is also one of the subscription scheme and supply of equipments of TV. DW.85 - R.Murali was working as a Manager, Administration in M/s. Super Duper TV Pvt. Ltd. during the year 1995-96. He has deposed that this company was incorporated under the Indian Companies Act, as per Ex.P617. The Memorandum of Association and Articles of Association were marked as Exs.P618 and P619 respectively. Ex.P682 is the Certificate of Registration issued in favour of M/s.Super Duper TV Pvt. Ltd. under Tamilnadu General Sale Tax Act, 1959. The certificate is valid for the period from 7.4.1994 till March, 1996. Ex.P683 is the Certificate of Registration issued in favour of the company under Central Sale Tax Act. There were 110 subscribers of this company and also there were agreements were executed by those subscribers. Approximately, more than 2,300 persons got membership as subscribers for this company. At the time of getting the membership, each member has paid Rs.5,000/- as non- refundable entrance fees to this company. They have executed a separate agreement in favour of the company.

He has further deposed that M/s. Super Duper TV Pvt. Ltd. has supplied equipments to the respective subscribers i.e. 110 subscribers. The said subscribers has paid Rs.1,500/- by way of hire charges. The period of agreement was about 24 months. Some of the subscribers have paid entrance fee by way of cash and some of them have paid through cheques and drafts. The entrance fee of Rs.5,000/- paid by each of those subscribers was not refundable. The said company had Current Account No.1152 with Indian Bank, Abhirampuram Branch, Chennai-18. The passbooks were seized during investigation. Ex.D157 and Ex.D158 are the passbooks pertaining to the Current Account of M/s. Super Duper TV Pvt. Ltd. Ex.D159 is the day book for the period from 18.4.1995 to 30.3.1996. The day book contains details of receipts and expenditure. Ex.D160 is the entrance fee collection book for the period from 18.4.1995 to 23.4.1996.

He has further deposed that Super Duper TV Pvt. Ltd. has made TV coverage of the marriage of Sudhakaran, for that a sum of Rs.2,00,000/- was paid by Ramkumar to the Company. Prior to incorporation of Super Duper TV Pvt. Ltd., the same business was carried under the name and style of 'Super Duper TV'. It was managed by A-3 as a Proprietor. Ex.D163 - Invoice book. Invoice bearing Sl.Nos.1 and 2 dated 17.11.1994 raised in favour of Tamilnadu Tourism Development Corporation Limited for Rs.4,35,705/- in respect of the equipments supplied by A- 3 to the said Corporation, Trichy Branch. In the same book, invoice Nos.3 and 4 raised in favour of M/s.Tamilnadu Tourism Development Corporation Limited for Rs.4,32,105/- in respect of equipments supplied by A-3 to Tanjavur Branch, TTDC. In the same book, invoice Nos.5 and 6 dated 17.11.1994 for Rs.4,28,505/- are in respect of the equipments supplied to Chidambaram Branch of TTDC. The said invoices were signed by one Kuberan, who was working as an Assistant in the Super Duper TV Pvt. Ltd. The Photostat copy of the statement of account pertaining to Current Account No.1104 for the period from 12.8.1994 to 23.8.1995 is available in the un- exhibited documentsproduced before the Court by InvestigatingOfficer and seized during the investigation. This document is not marked as Exhibits for the reason that it does not bear certificate as required under Banker's Books Evidence Act. He further deposed that in this file at page No.11, there is a bill dated 3.4.1995 raised in the name of Director, Information and Public Relations, Fort Saint George, Secretariat, Madras, for the total amount of Rs.42,00,000/- towards hiring of high brands cameras and film cameras and towards shooting, editing and mixing cost of raw films. Out of the said amount of Rs.42,00,000/-, Rs.39,60,000/- was paid by way of advance as shown in the bill as balance payable is shown as Rs.2,40,000/-. The said bill is marked as Ex.D164. In the same file, there is another bill dated 29.3.1995 raised in favour of Director, Information and Public Relations for the total amount of Rs.16,86,200/- being hire charges in respect of closed circuit TV taken for World Tamil conference held at Tanjavur during January, 1995. In this bill, the total advance received is shown as Rs.10,27,000/- The balance amount is shown as Rs.6,59,200/-. This bill is marked as Ex.D165.

He has further deposed that Ex.D166 is the bill dated 7.2.1995 for Rs.45,000/- raised in favour of the Chairman and Managing Director, SIDCO, Gundi, Madras towards hire charges of C.C.TV and relay equipments. The amount of Rs.45,000/- was received through cheque. Ex.D167 is the bill dated 7.11.1994 for Rs.2,40,000/- raised in favour of Tamilnadu Handloom Weavers Co. operative society towards charges for advertisements. The amount of Rs.2,40,000/- was received through cheque.

Ex.D168 is the bill dated 7.11.1994 for Rs.50,000/- in favour of M/s. Nataraj Exports Corporation, T.Nagar, Madras.

Ex.D169 is the bill dated 21.10.1994 for Rs.1,50,000/- in favour of Tamil Nadu Film Development Corporation.

Ex.D170 is the bill dated 3.10.1994 for Rs.1,00,000/- in favour of M/s.SPIC Fine Chemicals Ltd., Madras.

Ex.D171 is the bill dated 29.09.1994 for Rs.1,00,000/- in favour of M/s.Chettinadu Cement Corporation Ltd.

Ex.D172 is the bill dated 29.09.1994 for Rs.1,00,000/- in favour of M/s. Balaji Steel Corporation Ltd., Madras.

Ex.D173 is the letter dated 29.09.1994 addressed to Super Duper TV by Balaji Steel Corporation Ltd., enclosing Cheque bearing No.281531 dated 28.9.1994 for Rs.1,00,000/- towards Telecast charges.

Ex.D174 is the bill dated 12.09.1994 for Rs.10,000/- in favour of the Manager, Min Bimangal, Mookambika Complex, Alwarpet, Madras towards hire charges.

Ex.D176 is the letter dated 20.10.1994 addressed by Tamil Nadu Film Development Corporation to M/s. Super Duper TV enclosing Cheque No.485856 dated 20.11.1994 for Rs.1,50,000/-.

Ex.D177 is the letter dated 29.09.1994 addressed by Chettinad Cement Corporation Ltd. to M/s. Super Duper TV enclosing cheques bearing Nos.047085 and 047086 dated 29.9.1994 for Rs.50,000/- each towards advertisement charges.

During the cross-examination, he states that the Income Tax Department had accepted the figure Rs.62.15 Lakhs shown as receipts under scheme deposit by the assessee during the assessment year 1995-96. He also states that the receipts of 473 persons were signed by Kuberan. 907 persons' applications have been produced. Ex.D121 - agreement executed by the subscriber in favour of the Super Duper TV Pvt. Ltd. contain a clause that the entrance fees of Rs.5,000/- payable by each of subscribers is non-refundable. The Super Duper TV Pvt. Ltd. is not a cable operator. It only supplies cable TV equipments to the cable operator for doing their business. The Super Duper TV Pvt. Ltd. does not telecast any channels.

The Super Duper Pvt. Ltd. collects subscription amount, but there is a clear admission by this witness that the company does not telecast any channels, it supplies only TV equipments to the cable operators for doing their business and also it does not provide set-up boxes. Taking into consideration of the evidence of this witness and also relying on Exs.D163, D164, D166, D168, D169, D171, D172, D173, D174, D176, D177 and also Exs.D183, in my view, the income of the Super Duper TV Pvt. Ltd. can be assessed at Rs.1,00,00,000/-.

RENTAL INCOME:

It is the contention of learned Counsel for the Appellant that the rental income has been omitted by the prosecution i.e., Rs.3,22,000/-. This amount is added to the income.

ASSETS:

In so far as footwear is concerned, there were four members residing along with many servants. The prosecution has not segregated the footwear, though witness was examined PW.131 - Quality Controller of Tamilnadu Leather Industries Development Corporation, even as to when it was acquired was also not forthcoming from the evidence. In that view of the matter, I decline to take the value of the footwear.

In so far as the apparels of the accused Nos.1, 2 and 4 are concerned, the prosecution has examined PW.133 - R.Chengalvarayan, Manager, (Power loom silk division) Co- optex Regional Office. He speaks about quality and price of silk sarees. He deposed that there were 914 silk sarees, chudidhars, nighties altogether 6195 sets. Age of the sarees is not mentioned. There are three women residing at No.31, Poes Garden. The prosecution has not segregated wearing apparels of the accused. Besides A-1 was a Cine Actress from the age of 18 years. Most of the apparels which were used for the purpose of film shooting were handed over to her by the Film Producers. In that view of the matter, I decline to take the value of the apparels.

IMMOVABLE PROPERTIES:

STATEMENT PERTAINING TO ACQUISITON OF PROPERTIES VIZ., AGRICULTURAL LAND AND SITES Exs. SALE DEED SALE DEED PROPERTY VALUE IN RS.

CASH PAID OVER AND ABOVE SALE CONSIDERATION In so far as these items are concerned, there is no acceptable evidence adduced by the prosecution to show that un-accounted money was parted by the accused to the sellers. Therefore, I value the cost paid over and above the sale consideration as "Nil". COST OF CONSTRUCTION OF BUILDINGS INCLUDING NEW AND ADDITIONAL:

STATEMENT SHOWING COST OF CONSTRUCTION & ADDITIONAL CONSTRUCTION IN ANNEXURE-II Sl. Exhibits Page Amount [in Rs.] No. No. 1 Ex.P673 174 Rs. 80,75,000.00 2 Ex.P662 176 Rs. 1,25,90,261.00 3 Ex.P643 178 Rs. 1,52,59,076.00 4 Ex.P663 177 Rs. 2,13,63,457.00 5 Ex.P645 179 Rs. 6,40,33,901.00 6 Ex.P661 180 Rs. 5,40,52,298.00 7 Ex.P671 181 Rs. 7,24,98,000.00 8 Ex.P667 182 Rs. 29,59,000.00 9 Ex.P669 183 Rs. 80,36,868.00 10 Ex.P670 184 Rs. 8,00,000.00 11 Ex.P666 185 Rs. 20,43,000.00 12 Ex.P641 186 Rs. 24,83,759.00 13 Ex.P642 187 Rs. 10,92,828.00 14 Ex.P668 188 Rs. 53,11,000.00 15 Ex.P644 189 Rs. 20,38,959.00 16 Ex.P677 190 Rs. 39,34,000.00 17 Ex.P674 & 191 Rs. 14,17,538.00 Ex.P675 Total Rs.27,79,88,945.00 This Court has given a finding to the effect that the cost of construction is Rs.5,10,54,060/-.

Cost of construction as per DV & AC - Rs.27,79,88,945.00 Less: Cost of construction as per finding of this Court Rs. 5,10,54,060.00 Rs.22,69,34,885.00 This amount of Rs.22,69,34,885/- has been deducted from the assets.

In so far as Gold, Diamond jewelry, Silver wares, Fixed Deposit, Shares, Cash balance in Bank Accounts Valuation of the Vehicle, Valuation of the Machineries, Valuation of the Wrist Watches are concerned, the valuation made by the Director of Vigilance and Anti Corruption has been accepted.

section 107 of the ipc deals with abetment of a thing. Abetment is constituted by instigating a person for committing an offence or intentionally hiding a person committing it. Instigation necessarily connotes some suggestion or support or stimulation to the commission of the act itself. Sometimes, illegal omission also comes under the purview of the abetment. Though the prosecution has adduced evidence, nearly about 259 witnesses, prosecution mainly relies on registration of 165 documents i.e., sale deeds and registration of the documents at the residence of Accused No.1. In the instant case, the case of the prosecution is that, Accused No.1 has amassed wealth and she has parted with this amount to Accused Nos. 2 to 4 to acquire immovable properties, namely, agricultural lands, sites and 32 firms and companies. There is a positive evidence to the effect that the Accused, firms and companies have borrowed a a loan in a sum of Rs.24,17,31,274/-. Besides, they also borrowed loans from private parties. This loan borrowed by private parties has not been considered by this Court. However, the evidence reveals that this amount has been utilized for purchase of agricultural lands, sites, firms and companies. Therefore, the question of Accused No.1 abetting for Accused Nos. 2 to 4 for acquiring the immovable properties does not arise. Accused Nos. 1 to 4 individually secured loans from the banks and they have acquired the properties. Therefore, the charge under Section 107 read with section 109 of the Act must fail.

Insofar as criminal conspiracy by Accused Nos. 1 to 4 is concerned, allegation against Accused No.1 is that Accused No.1 has amassed wealth and it has been parted to Accused Nos. 2 to 4 to acquire immovable properties such as lands, sites, partnership firms and companies. The prosecution case is that amassing the wealth and parting the amount for Accused Nos. 2 to 4 is illegal act and it is an illegal agreement. As stated earlier, prosecution has relied on evidence of PW.56 - P.S. Rajaram and PW.76 - Siva, broker, speak about sale deeds of lands. The Trial Court has also relied on evidence of these witnesses and came to conclusion that there was abetment as well as conspiracy to use the ill-gotten wealth for purchase of immovable properties and also acquiring the firms and companies. The agreement is gist of the offence. Conspiracy is an inference from circumstances. Since the conspiracy is often hatched up in utmost secrecy, it is impossible to prove the same by direct evidence. Mere Accused Nos. 2 to 4 living with Accused No.1 does not itself contemplate offence of conspiracy. Conspiracy construes any combination or agreement between two or more persons to do an unlawful act. There must be reason to believe that there was conspiracy and accused persons were members of that conspiracy.

Section 10 of the Indian Evidence Act deals with things said or done by the Conspirator in reference to common desire. This section will come into play only when Court is satisfied that there are reasonable ground to believe that two or more persons have conspired together i.e. to say there must be prima facie evidence. Where evidence is only circumstantial, the circumstance in their totality must be such as would not only be consistent with the guilt of the Accused, but also inconsistent with any reasonable hypothesis of his innocence. The aspects of criminal conspiracy are an agreement to believe an illegal act. In the present case, evidence on record discloses that Accused Nos. 2 to 4 have borrowed huge amount and they have acquired the immovable properties like agricultural lands, legal entities. The source of income is lawful. Object is also lawful. Just because Accused Nos. 2 to 4 stay along with Accused No.1, that itself is not component which the Court can come to the conclusion that Accused Nos. 1 to 4 abetted and conspired and acquired the property in an improper way.

In the case of SONAMATI DEVI AND ANOTHER vs. THE STATE reported in AIR 1958 PATNA 508 (V 45 C 1262); Head Notes a, b and c read as under:

"(a) Criminal Law Amendment Ordinance (38 of 1944) Ss, 5 (2) 4- Claim under S.4 - Onus of proof - (Evidence Act (1872) S.100.

"The entire scheme of the Ordinance shows that evidence has to be adduced by the claimant in support of his case that he has interest in the property attached, and when that evidence has been adduced, it is for the court to consider whether that evidence was sufficient to establish his claim, independent of the question whether any evidence in rebuttal had been adduced by the state. If that evidence by itself is not sufficient to establish the claim laid by the claimant, the claim must fail, not-withstanding the fact that no evidence to the contrary had been led in behalf of the state. (para 4) Anno: C.J.I Evi Act, Ss.100-103 N.3

(b) Criminal Law Amendment Ordinance (38 of 1944) S.2 (2) (a) - Date if termination -

Appeal to High Court pending - Date of final order of High Court is the date.

(para 5)

The combined effect of Ss. 10 and 13 is that notwithstanding the order of acquittal the attachment will continue in full force until the District Judge has passed orders in accordance with the provisions of S.13. Therefore, the acquittal of the accused has not the effect of terminating the attachment.

(para 6)"

The Court should give a finding in case the accused is convicted, as to the amount of money or value of other property procured by means of the offence. This would comply with the Section 12 (1) of the Criminal Law Amendment Ordinance, 1944. Section 3 of the Criminal Law amendment Ordinance, 1944 deals with i) the money or other property procured by means of the offence, ii) property other than the above. Learned District Judge should know the amount he is to forfeit. The forfeiture by the District Judge under Section 13(3) cannot be equated to forfeiture of property which is provided in Section 53 of the Indian Penal Code. Section 13(1) of the Criminal Law Amendment Ordinance, 1944 deals with upon the termination of any criminal proceedings. Article 20(1) deals with the conviction of persons for offences and for subjecting them to penalties. It firstly provides that no person shall be convicted of any offence except for violation of a law in force at the time of the commission of the act charged as an offence. Secondly, it provides that no person shall be subjected to a penalty greater than that which might have been inflicted under the law in force at the time of the commission of the offence. Notice of the interim order should be given to the concerned parties. The court should indicate the money or value of the property obtained by means of the said offence. Section 12 of the Ordinance lays down that criminal court convicting the accused shall record finding as to the amount of money or value of other property procured by the accused by means of the offence. It is at the end of the trial only the court will be in a position to evaluate the money or other property procured by the accused by means of the offence. No specific provision was made for determination by the court of the illegal profits and other gains obtained by the accused from the properties acquired by him by bribery or corruption. The court will determine to what extent the assets are disproportionate and to this extent only the assets are liable for confiscation. Till this stage, it cannot be said with certainty as to which portion of the property under attachment is liable for confiscation. The combined effect of Sections 10 and 13 is that notwithstanding the order of acquittal the attachment will continue in full force until the District Judge has passed the orders in accordance with the provisions of Section 13. Therefore, acquittal of the accused has no effect of terminating the attachment.

The attachment will be in force and continue in force until orders as provided by Sections 10 and 11 of Criminal Law Amendment Ordinance (38 of 1944) are passed by the District Judge.

The power to confiscate can be exercised only with respect to the property which was actually used in commission of offence. One of the contentions raised by learned Counsel for the appellants is that no notice have been served on the companies and firms, therefore confiscation is bad in law. Parties interested have not been heard. The learned Sessions Judge cannot straight away confiscate the property without giving a hearing to the interested parties.

Statement recorded under sections 161 and 162 can be looked into during the trial and enquiry. The question of confiscation arises only after conclusion of trial. Even statement of accused or witnesses can be looked into for disposal of the property which takes place at the conclusion of the enquiry or trial of the case. It is well settled that an order of confiscation without holding an enquiry is illegal. While disposing of the property, reasons for choosing a particular mode should be stated. The court should give a finding that in case the Accused is convicted for an amount of money or value of property procured by himself as an offence, then only there will be compliance of section 12[1] of Criminal Law [Amendment] Ordinance, 1944.

The Trial Court should know what amount of the Accused has to forfeit. At the first instance, property will be attached. The Anti Corruption and Investigating Agency made an application for attachment of the property. Subsequently, after conclusion of the trial, the property in question was confiscated. I understand that there are several miscellaneous first appeals filed before this Court with regard to attachment. Therefore, I do not want to express any opinion with regard to attachment. Even in case if there is acquittal of the Accused, it will not have the effect of terminating the attachment. However, since no notice have been issued to the Accused, the Trial Court has not considered the statement of witnesses and also the statement of the accused and also the evidence placed on record. The Trial Court has failed to appreciate the evidence in a proper perspective. The immovable properties were acquired by borrowing huge loan from the Nationalised Banks. It is difficult to infer that the properties were acquired by means of ill-gotten money. Therefore, in my view, confiscation of the properties by the Trial Court is not sustainable in law.

Dr. Subramanian Swamy filed a private complaint before the Principal Sessions and District Judge, Chennai in Miscellaneous Petition No.3238/1996 which was registered. After registration of the crime, exercising the power under section 210 of Cr.PC, both private complaint and the complaint instituted under the Police report were clubbed. Accused No.1 was arrayed as Accused in the First Information Report. Though names of Accused Nos. 2 to 4 were mentioned in the first information report, they were not arrayed as Accused. Benami transaction was also alleged in the first information report. But, the investigating agency did not file charge sheet for benami transaction. The provision under section 13[1][e] of the Prevention of Corruption Act connotes if he or any other person on his behalf is in possession or clearly suggests that any person to have resources on behalf of the public servant that would be included in his assets, in the sense that, he would have to account to these assets also. So the prosecution mainly relies on sections 13[1][a] and 13[1][e] of the Prevention of Corruption Act. The charge sheet was filed against Accused Nos. 1 to 4. The allegation is that the Accused No.1 amassed wealth and Accused Nos. 2 to 4 purchased various properties. But, the prosecution has not adduced any evidence to the effect that Accused No.1 instigated or conspired together with Accused Nos. 2 to 4 to acquire lands and immovable properties. The prosecution mainly relies on evidence of the Sub-Registrar and brokers and also the sale deeds. Except marking the sale deeds, there is no other evidence. The burden lies on the prosecution to establish benami transaction. The prosecution has not adduced any evidence with regard to allegation of benami transaction. Accused No.1 is cine actress. She has filed returns since she was a minor. The property bearing No.36, Poes Garden, was acquired by her mother and also Natya Kala Nikethan. Accused No.1 acquired adjacent property of Poes Garden for sum of Rs.8 lakhs. Except this, she has not purchased any property. The allegation of prosecution is that Accused Nos.2 to 4 purchased the property from the ill gotten money of Accused No.1. The value of immovable property acquired amounts to Rs.6,24,09,120/- i.e., agricultural lands. Kodanadu Tea Estate was acquired by Accused Nos. 2 to 4 and it is worth about Rs.3.50 Crores. The prosecution itself has shown the property of Accused Nos. 1 to 4 firms and companies to the extent of Rs.9,34,26,053.56/- whereas the loan borrowed by Accused Nos. 1 to 4 and also firms and companies is to the extent of Rs.24,17,31,274/-. The burden lies on the prosecution in 'SITARAM SYAN NARAIN v. ISWARI CHARAN SARANGI AND OTHERS' reported in AIR 1934 PATNA 492 wherein the High Court of Patna has held with regard to intermingling of goods with that of the plaintiff - burden of proving what proportion belonged to plaintiff is a must.

Section 103 of the Indian Evidence Act,1872 reads as under:

"103.Burden of proof as to particular fact

- The burden of proof as to any particular fact lies on that person who wishes the Court to believe in its existence, unless it is provided by any law that the proof of that fact shall lie on any particular person."

All the facts, however, numerous and complicated which goes to make the Accused guilt, must be proved by the prosecution. If the Accused wishes to prove a particular fact, for example, source of income from which he acquired the assets, then he must prove it. The role played by each of the Accused has also to be established by the Prosecution. But, in the instant case, prosecution has not adduced any evidence in respect of section 103 of the Indian Evidence Act.

It is the allegation of the prosecution that Accused Nos. 1 to 4 acquired various immovable properties, invested huge amount towards construction. Though nearly 14 Engineers were examined, but the valuation report has been marked, the Engineers did not speak anything about measurement of the buildings, except marking the valuation report. It is well settled that the documents do not themselves prove the contents therein. The proof of contents has to be given by cogent evidence. If these two aspects have been narrated by the witnesses, then an opportunity should be given to the opposite parties to contest the correctness of such evidence by cross examination. But, in the instant case, simply valuation report has been marked, contents have not been narrated. The prosecution witnesses, namely, Engineers have used the word supreme quality of marbles, granites highest quality of sanitary fittings. But, the evidence on record discloses that the marbles and granites were around Rs.100/- and sanitary fittings are of Hindustan Sanitaryware and Jaguar. I have adopted the square rate and cost of construction per square rate is taken as Rs.28,000/-. The marbles or granites samples were not sent to the suppliers.Quotation is not procured. They have simply guessed the rate and assessed the value of granite and marbles. The construction cost was valued at Rs.27,79,88,945/- by the DV & AC. The construction area measured by way of square feet is about 1,66,839.68 sq. feet. It amounts to 1668.39 squares. The learned Sessions Judge has simply on guess work has reduced the cost of construction to the extent of 20% without verifying the evidence and the material placed on record. This Court has to assess the value of the construction of the year 1995. This has to be assessed in the year 2015. It is a very difficult task when evidence of Engineers of PWD are vague and without any data like measurement by way of square feet and measurement of area laying of marbles and granites and even to ascertain the value of teak, no Forest Officer or Expert has been examined. The Engineers of the PWD are more theoretical rather than practical.

Insofar as marriage expenditure is concerned, Accused No.1 has disclosed that she has spent about Rs.28,68,000/- for bearing marriage expenses. DW.1 - Ramkumar has deposed that he has spent about Rs.92 lakhs. Bank passbook is also produced and marked. The bride's father Narayanswamy was a Professor in IIT. His evidence on record discloses that he has spent about Rs.18 lakhs. There is positive evidence to the effect that party workers of AIADMK has met the expenses of food and pandal. Engineers valued pandal based on plan. Their evidence is to the effect that without inspecting the pandal, they have given statement of expenditure that might have occurred. Their evidence is hear-say. The evidence on record reveals that party workers took up the responsibility of erecting pandal. SriA.R. Rahman and SriMandolin Srinivas have performed music with free of cost. The bridegroom's grandfather is Mr. Sivajiganeshan. He was a famous Tamil film actor. He was also known to A.R. Rahman. Now the question that arises is what is the amount that was spent by Accused No.1 for the marriage of Accused No.3. Accused No.1 has declared in her income tax returns that she has spent about Rs.28,68,000/-. In our Hindu customs, it is bride's family members who take care of marriage expenditure. Nominal expenditure will be borne by bridegroom's family. Just because Accused No.1 was Chief Minister at that time, we cannot saddle all the marriage expenses on her part. Relying on income tax returns towards expenditure of marriage, I consider that she has spent about Rs.28,68,000/-. Besides, evidence of father of bride is withheld by the prosecution. Accused No.3 Bridegroom has also not entered the witness box. The Priest who has performed the marriage has not been examined. The Contractor for putting up pandal has not been examined in this case. Due to insufficient and vague evidence, it is difficult to assess as to what is the expenditure that is incurred. Besides, some expenses are not verifiable expenditure.

PW.259 - Nallamma Naidu fairly admits in his evidence that reference is made to the letter sent to Governor through Government of Tamilnadu and in that letter disproportionate assets made was Rs. Rs.62,25,20,896/-. Notice was also issued to Accused No.1 for her say. But, she replied that, she will give reply in the Court. Annexure-II to the charge sheet revealed that the amount disproportionate is Rs.66,44,73,537.27/-. Annexure-VII reveals an amount of Rs.2,23,30,799/- is added. The prosecution valued disproportionate assets at Rs.66,65,20,395/-. The evidence of PW.259 is inconsistent because while seeking sanction he mentions amount as Rs.62,25,20,896/-, but while filing charge sheet it is mentioned as Rs.66,44,73,537.27/-. The evidence of PW.259 also reveals that Accused Nos. 1 to 4 have borrowed heavy loans. Anti-Corruption and Vigilance Manual is not framed in conformity with the rulings of the Apex Court. Manual does not indicate as to what is the percentage of disproportionate income/assets are to be mentioned in the FIR or charge sheet. In my view, the omission to mention the percentage of disproportionate income in the charge sheet is not in accordance with law. The case of the prosecution that Accused No.1 amassed wealth and acquired agricultural lands, sites, floated firms, became Directors of the companies cannot be believed because the money that has been spent for acquiring the said properties can be inferred from the loans borrowed from the Nationalized Banks. Besides, Accused was having an income from Kodanadu Tea Estate for about ten months.

PW.177 - Shanmugha Sundaram speaks about loan application of Tmt. Gunapasini for a sum of Rs.3.75 Crores. On request of Gunapasini, they changed the loan liability to A2, A3 and A4 since they became the share holders.

The evidence of PW.71 - S.Radhakrishnan, Horticulture Officer reveals at Page No.11 that at Metal King Sudhakaran met Hiriyan personally for 10 minutes. Hiriyan was appointed for the kodanadu Tea Estate and given an honorarium of Rs.5,000/- per month, that day night he and Hiriyan went to Ooty. From there, via Kothagiri went to Kodanadu. He introduced Hiriyan to Kodanadu Manager there and later returned to Thirunelveli. Kodanadu Tea Estate measures 800 acres. In that, already in 700 acres, tea has been cultivated. The remaining were vacant lands. Hiriyan said that there, one acre of land will fetch Rs.1 lakh. In Kodanadu there were two Bungalows, one tea factory and quarters for the employees.On perusal of evidence of PW.71, it is clear that Kodanadu Tea Estate generated income to the extent of Rs.7 Crores. This is the income generated from the tea estate. The Investigating Agency has valued the building constructed in the tea estate and also pipes laid down in the tea estate. But, it is very strange that they have not assessed the income of the tea estate and added to Annexure-III i.e., income during check period between 1.7.1991 to 30.4.1996. The Investigating Agency has omitted this income in Annexure-III. Even defence has not examined any witness as to what is the income generated from the tea estate and they have also not claimed the same. Therefore, this court has not considered this income while calculating disproportionate assets. However, I am constrained to mention that this aspect cannot be ignored totally while calculating the disproportionate assets of the Accused.

PW.53 - R. Ashokan speaks about capacity of grinding 100 tonnes of paddy everyday by Ramraj Agro Mills Limited. This income has also not been properly assessed. The learned Special Judge has not appreciated the evidence placed on record in a proper perspective.

Though I have not considered the value of footwear and sarees, there is discrepancy in the evidence of PW.259

- Nallamma Naidu, Chief Investigating Officer. Annexure- II discloses assets at the end of the check period i.e., as on 30.4.1996, combination of Accused Nos. 1, 2, 3 and 4, partnership firms, companies is Rs.66,44,73,537/-. I intend to take the value of the assets as indicated by the prosecution i.e., Rs.66,44,73,537/-.

In the case of KRISHNANAND AGNIHOTRI V/S. STATE OF M.P reported in AIR 1977 SC 796; wherein paragraph No.33 reads as under:

appellant during the period in question, the appellant possessed total assets worth Rs.55,732.25. The assets possessed by the appellant were thus in excess of the surplus income available to him, but since the excess is comparatively very small - it is less than 10%, of the total income of Rs.1,27,715.43 - we do not think it would be right to hold that the assets found in possession of the appellant were disproportionate to his known source of income so as to justify the raising of presumption under sub-section(3) of section

5. We are of the view that, on the facts of the present case, the High Court as well as the Special Judge were in error in raising the presumption contained in sub-Section(3) of Section 5 and convicting the appellant on the basis of such presumption."

Applying the principle laid-down in above mentioned Krishnanand Agnihotri's Case, statements showing the calculation of Total Assets and Income of accused Nos.1 to 4, firms and companies and arriving at the percentage of disproportionate assets thereof, are as under:

Statement of the income of Accused Nos. 1 to 4, firms and companies are as under:

Rs.37,59,02,466-Rs.34,76,65,654= Rs.2,82,36,812 Percentage - Disproportionate assets x 100 Income

- Rs.2,82,36,812 x 100 Rs.34,76,65,654 = 8.12% It is well settled law that according to Krishnanand Agnihotri's case, when there is disproportionate asset to the extent of 10%, the accused are entitled for acquittal. A circular has been issued by the Government of Andhra Pradesh that disproportionate asset to the extent of 20% can also be considered as a permissible limit. The margin of 10% to 20% of the disproportionate assets has been taken as a permissible limit, taking into consideration the inflatory measures. Since the value of apparels and slippers etc., are of insignificant value, I did not deduct this amount from the assets of DV & AC. The Prosecution has mixed up assets of Accused, firms and companies and also added the cost of construction i.e., Rs.27,79,88,945/- and marriage expenses at Rs.6,45,04,222/- and valued the assets at Rs.66,44,73,573/-. If we remove the exaggerated value of cost of construction and marriage expenses, the assets will work out at Rs.37,59,02,466/-. The total income of the Accused, firms and companies is Rs.34,76,65,654/-. Lack of proportion amount is Rs.2,82,36,812/-. The percentage of disproportionate assets is 8.12%. It is relatively small. In the instant case, the disproportionate asset is less than 10% and it is within permissible limit. Therefore, Accused are entitled for acquittal. When the principal Accused has been acquitted, the other Accused, who have played a lesser role are also entitled for acquittal.

In an appeal from a conviction it is for the appellate Court as for the first Court to be satisfied affirmatively that the prosecution case is substantially true and that the guilt of the appellants has been established beyond all reasonable doubt. It is not for the appellants to satisfy the appellate Court that the first Court had come to a wrong finding. In an appeal by some of the convicted persons, it is open to this Court as an appellate Court to examine the entire evidence. The powers of the appellate Court under this Section are the same as those of the Trial Court. If after examining the evidence, this Court is in a position to say that the findings arrived at are erroneous, or contrary to evidence then not only there is no legal prohibition to do so but in the interest of justice, that must be done. In this case, the Trial Court has ignored the Income Tax proceedings as minimum evidentiary value. The Trial Court has not appreciated the evidence in a proper perspective. Though the Trial Court in its judgment mentioned that the accused availed loan by the Indian Bank, but it has not considered the same as income. Therefore, the Trial Court has erred in not considering the loans as income. Even the valuation though disputed by the defence, the Trial Court has failed to examine the evidence relating to cost of construction at that relevant time and simply arrived at a conclusion that 20% of the cost has to be reduced without appreciating the evidence placed on record. This 20% reduction is calculated on surmises and conjectures. The Trial Court has assessed the Marriage Expenses at Rs.3,00,00,000/-. There is no acceptable evidence to point-out that A-1 has spent about Rs.3,00,00,000/-. In spite of it, the Trial Court has arrived at a figure of Rs.3,00,00,000/- as modest and conservative estimation. Arriving at Rs.3,00,00,000/- towards marriage expenses and fixing liability of Rs.3,00,00,000/- to A-1 alone is not proper. Most of the claims put-forth by the accused have been rejected by the Trial Court. It is the contention of the learned counsel for the appellants that without treating the witnesses as hostile, the witnesses were recalled and cross-examined. The questions are put in such a manner that whether what they have stated in the examination-in- chief is correct or in the cross-examination is correct by securing answer to this question and also by adopting this method, they cannot wipe-out the answers elicited in the cross-examination. This is also one of the factors, which weigh in favour of the accused. If the witness gives different statements at different stages, it is unsafe to place reliance on them. Taking into consideration of overall circumstances and material placed on record, in my view, the Judgment and finding recorded by the Trial Court suffers from infirmity and it is not sustainable in law.

12. In view of the above discussion, I pass the following:

ORDER [A] Criminal Appeal Nos.835/2014, 836/2014, 837/2014 and 838/2014 are allowed.

[i] The Judgment of Conviction and Sentence passed in Spl.C.C.No.208 of 2004, dated 27.9.2014, on the file of the 36th Additional City Civil & Sessions Judge (Spl. Court for Trial of Criminal Cases against Kum.Jayalalitha & Ors.), Bengaluru, is hereby set-aside.

[B] The Appeals in Criminal Appeal Nos.17/2015, 18/2015, 19/2015, 20/2015, 21/2015 and 22/2015 are allowed in part.

[i] Order of the Trial Court relating to confiscation of the properties both movable and immovable, is hereby set aside.

Sd/-

JUDGE KM/JTR/LB/AN/-

Selvi J. Jayalalitha v. State

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Appellant's Arguments

Respondent's Arguments (Prosecution)

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

Selvi J. Jayalalitha v. State

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