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AMICUS AI
Citation Codes
Equivalent Citations
citation codes
Case Number
Disposition
Attorney(S)
Judges
Acts
  • Section 5(1)(b) read with Section 5(2) of the Prevention of Corruption Act, 1947
  • Section 360 Criminal Procedure Code, 1973
  • Section 5, Subsection 2 of the 1983 Income Tax Act
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Disposition
Attorney(S)
Judges
Acts
  • Section 5(1)(b) read with Section 5(2) of the Prevention of Corruption Act, 1947
  • Section 360 Criminal Procedure Code, 1973
  • Section 5, Subsection 2 of the 1983 Income Tax Act
Smart Summary

Factual and Procedural Background

The appellant, N.M. Parthasarathy, proprietor of “Electro-technik” and a former Inspector of Industries, was tried together with another Inspector of Industries for events occurring between February 1967 and February 1969. The prosecution alleged that the two conspired to obtain a Small-Scale Industries Registration Certificate, an Essentiality Certificate and import licences by making false representations to various governmental authorities. Seven substantive charges—conspiracy under Section 120-B read with Section 420 of the Indian Penal Code (IPC) and Section 5(1)(b) read with Section 5(2) of the Prevention of Corruption Act, 1947, three counts of cheating under Section 420 IPC, and three counts of abetment—were framed. The trial court (Special Judge, Madras) acquitted both accused on 23 July 1973. On State appeal, the High Court (3 April 1980) re-appraised the evidence, set aside the acquittal, and convicted the appellant on all counts, imposing concurrent sentences of two years’ rigorous imprisonment on each. The present judgment is on the appellant’s further appeal, during which he remained on bail by order dated 29 April 1980.

Legal Issues Presented

  1. Whether the High Court erred in reversing the trial court’s acquittal when, according to the appellant, two views of the evidence were reasonably possible.
  2. Whether, despite affirming the conviction, the Supreme Court should exercise its discretion under Section 360 of the Code of Criminal Procedure, 1973, to release the appellant on probation.

Arguments of the Parties

Appellant’s Arguments

  • The High Court was not justified in overturning the acquittal because, at best, the evidence permitted two plausible views; under settled law an acquittal should not be reversed in such circumstances.
  • The long lapse of time since the offences (1967-69) and the appellant’s subsequent contributions to Indian industry warranted leniency and the benefit of Section 360 CrPC.

No detailed arguments from the respondent were recorded in the opinion.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The Court endorsed the High Court’s exhaustive re-appraisal of the evidence, noting that the High Court had found only one rational conclusion: the appellant’s guilt beyond reasonable doubt. Key factual findings adopted by the Court included:

  • The appellant’s premises had only a single-phase domestic electricity supply in August 1969, incapable of powering industrial machinery.
  • Inspections revealed machinery worth merely Rs 9,200–10,000, far below the Rs 94,000 valuation declared in the appellant’s application.
  • The physical dimensions of the factory (18 ft × 12 ft) made installation of the claimed additional machinery implausible.
  • False statements by the co-accused about machinery installation, and coordinated efforts to secure certificates and licences, proved conspiracy and cheating.

Having affirmed the conviction, the Court considered whether incarceration remained necessary. It weighed: (i) the offences occurred more than a decade earlier; (ii) the appellant’s acquittal had stood for several years before reversal; (iii) the appellant’s significant industrial achievements benefiting national interests; and (iv) his continued compliance with bail conditions. Concluding that rehabilitation rather than imprisonment served justice, the Court invoked Section 360 CrPC to release the appellant on probation subject to a bond to be approved by the Special Court, Madras.

Holding and Implications

Conviction and sentence affirmed, but appellant released on probation under Section 360 CrPC.

Implications: The appellant must appear before the Special Court, Madras within two months to execute a bond; failure to do so will revive the original custodial sentence. The judgment provides no new legal precedent on evidentiary standards but illustrates the Supreme Court’s readiness to apply probationary relief in white-collar offences when long-pending appeals, post-offence conduct, and public interest considerations so warrant.

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    N.M Parthasarathy v. State By S.P.E .

    Kuldip Singh, J.— The appellant N.M Parthasarathy is the sole proprietor of a firm called “Electro-technik”. He was formerly working as Inspector of Industries. He, along with an Inspector of Industries, was prosecuted on the allegations that between February 1967 and February 1969 they entered into a criminal conspiracy to obtain Small Scale Industries Registration Certificate for additional lines of manufacture, Essentiality Certificate and import licences on false representations made to the Director of Industries, Assistant Director of Industries, Joint Chief Controller of Imports/Exports and the Iron and Steel Controller. The first charge framed against both of them was for an offence of conspiracy punishable under Section 120-B read with Section 420 IPC and Section 5(1)(b) read with Section 5(2) of the Prevention of Corruption Act, 1947. Charges 2, 4 and 6 framed against him were for offence of cheating punishable under Section 420 IPC. Charges 3, 5 and 7 were framed against the second accused for abetment of cheating punishable under Section 420 read with Section 109 IPC. The 8th charge was also against the second accused under Section 5(1)(b) read with Section 5(2) of the Prevention of Corruption Act, 1947. The trial court acquitted both of them on all the charges. The State went in appeal against the judgment of acquittal and the High Court on re-appreciation of evidence set aside the acquittal and convicted both of them on all the counts. The appellant was sentenced to undergo rigorous imprisonment for two years under Section 120-B IPC and rigorous imprisonment for two years for each of the three counts of cheating under Section 420 IPC. The sentences were to run concurrently.

    2. We have heard Mr Hardev Singh, learned counsel for the appellant and Mr V.C Mahajan, Senior Advocate for the respondents. Mr Hardev Singh has taken us through the judgments of the trial court and that of the High Court. Mr Hardev Singh has primarily argued that the High Court has grossly erred in reversing the judgment of acquittal rendered by the trial court. According to him even if two views were possible the High Court was not justified in taking a different view than the trial court and reversing the acquittal. This precise argument was raised before the High Court on behalf of the appellant. The High Court rejected the same as under:

    “In the circumstances, I am of the opinion that this is not a case where, on the evidence available on record, two conclusions are possible and therefore this Court could not interfere with the acquittal of the accused by the learned Special Judge. I am of the opinion that only one conclusion is possible on the evidence on record and that it is that the accused are guilty of all the charges framed against them and that interference with the acquittal of the accused by the learned Special Judge is called for in this case.”

    3. We are of the view that High Court was justified in reaching the above conclusion. The High Court examined the evidence on the record in detail and rightly came to the conclusion that the guilt against the appellant was established beyond reasonable doubt.

    4. The High Court on re-appreciation of the evidence, independently reached the following findings:

    “Thus it is established by Ex. D-36 as well as the evidence of PWs 3 and 6 that the first accused had only a single-phase domestic supply of electricity at his premises in Katpadi Extension even in August 1969, that he could not have used that supply of electricity validly for any non-domestic purposes and that it would not have been possible to produce any industrial machinery with that single phase power.
    The evidence of PWs 6, 13, 15 and 19 shows that the machinery found in the premises of Electro-technik during their inspections were worth only about Rs 9,200 or Rs 10,000 and not of the value of Rs 94,000 as represented by the first accused in the list submitted by him along with his application, Ex. P-18.
    It has already been found that with the 230 volts domestic supply he could not have produced any of the new end products. The additional machinery required for producing these new end products had not been installed in the first accused's factory. It is hardly likely that all the alleged additional machinery could have been installed in the factory whose dimensions are only 18 feet by 12 feet.
    It is made clear by the evidence that the second accused had made false statements in Ex. P-96 about the alleged installation of the additional items of machinery in the first accused's factory. For the reasons stated above I find that the prosecution has proved charges 2 and 3 satisfactorily, beyond all reasonable doubt.
    The first accused has succeeded in obtaining the Essentiality Certificate, Ex. P-5, by making these false representations and the second accused has induced PW 5 to recommend in Ex. P-24 the issue of the Essentiality Certificate and PW 12 to issue the Essentiality Certificate and Ex. P-14 by making the false representations Exs. P-22 and P-23, as in Ex. P-19, which have been found to be false in the earlier part of this judgment. Therefore, I find that the prosecution has proved these two charges 4 and 5 against the accused satisfactorily and beyond all reasonable doubt.
    In the present case both the accused have acted in concert in the first accused obtaining the SSI registration certificate, Ex. P-20 as amended by Ex. P-21, the Essentiality Certificate, Ex. P-5, and the import licences, Exs. P-6 and P-7, and the second accused enabling him to obtain the same by his recommendations, Exs. P-19, P-22 and P-23 which contain false particulars. This would show that both the accused have acted in concert for committing these offences and that they would not have done so if there had been no conspiracy. In these circumstances I find that the prosecution has established the charge of conspiracy framed against both the accused satisfactorily and beyond reasonable doubt.”

    5. We agree with the abovequoted reasoning and the conclusions reached by the High Court. We, therefore, uphold the conviction and sentence awarded by the High Court.

    6. While upholding the judgment of the High Court, we are inclined to agree with the learned counsel for the appellant that this is a fit case where benefit of Section 360 Criminal Procedure Code be extended to the appellant. The occurrence in this case relates to the period between February 1967 and February 1969. The Special Judge, Madras by his judgment dated July 23, 1973 acquitted the appellant. The High Court on April 3, 1980 reversed the trial court and convicted the appellant. This Court granted bail to the appellant on April 29, 1980. Mr Hardev Singh has placed before us documents showing several achievements of the appellant in the industrial field since then. The appellant's industry has manufactured the largest Hot-Air Kiln in India for Ministry of Railways, largest Degreasing plant for Nuclear Fuel complex, Sintering Furnace for anti-tank missiles and various other items for the Ministry of Defence and other departments of the Government of India. The appellant claims that he has set up 100 per cent export unit with Rs 75 crores export per annum. For all these reasons we are of the view that it is expedient that the appellant be released on probation. We, therefore, direct that he be released on his entering into a bond to the satisfaction of the Special Court, Madras. The Special Court shall pass an order in terms of Section 360 Criminal Procedure Code, 1973 to its satisfaction. A copy of this order be sent to the Special Court, Madras immediately. The appellant is directed to appear before the Special Court, Madras within two months from today to enable the Special Court, Madras to pass an order as directed by us. In the event of appellant's failure to present himself before the Special Court as directed he shall undergo the original sentence awarded by the High Court.

    7. The appeal is disposed of in the above terms.

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    Comments

    N.M Parthasarathy v. State By S.P.E .
    (Jan 21, 1992)