C. V. Narayana Reddy vs State Thr Central Bureau Of Investigation

By this appeal the Appellant (hereinafter referred to as Accused) has challenged Judgment and Order dated 21.10.2016 passed by the Sessions Judge, North Goa at Panaji, whereby the Appellant has been held guilty for ofences punishable under Section 7 and Section 13(2) r/w Section 13(1)(d) of the Prevention of Corruption Act, 1988, (PC Act, 1988 for short).

For conviction under Section 7 of the PC Act, the accused is sentenced to sufer Simple Imprisonment for one year and to pay ine of ₹25,000/- and in default to undergo Simple Imprisonment of three months. For conviction under Section 13(1)(d) r/w 13(2) of PC Act the Accused is sentenced to undergo Imprisonment for two years and to pay ine of ₹25,000/-and in default to undergo Simple Imprisonment of three months. Both sentences to run concurrently.

Before adverting to the evidence led by rival parties, it would be necessary to briely set out the case of the prosecution. he Accused, at the relevant time, was working as an Income Tax Oicer in Ward 1(2) of the Commissioner of Income Tax, Panaji-Goa. Being a public servant, he is alleged to have demanded and accepted a bribe of Rs.60,000/- from the complainant, one Mr Rudresh Naik, the Managing Partner of M/s. Swastik Cruises as a motive for processing the income tax returns of M/s. Swastik Cruises and as an alleged reward for not bringing additional tax liability of ₹1,50,000/- on record, during the scrutiny of income tax returns of M/s. Swastik Cruises for the assessment year 2007-2008. Aggrieved by the alleged demand, Rudresh Naik lodged a complaint with CBI on 13.07.2009. On the basis of the said complaint, CBI took cognizance and registered a case against the Accused after allegedly verifying the demand wherein the Accused agreed to accept ₹30,000/- as a bribe from the complainant on 13.07.2009.

It is further the case of the prosecution that post veriication, the CBI set up a trap at Hotel Aroma, Panaji and the Accused was caught red-handed while demanding illegal gratiication of ₹30,000/-.

he Accused was apprehended on the spot during the trap proceedings and charge-sheeted by the CBI, Anti-Corruption Bureau (ACB), Goa for ofence punishable under Section 7 and Section 13(2) r/w Section 13(1)(d) of the PC Act. he Accused took up a defence of total denial and false implication and claimed to be tried.

Charge was explained to the Accused on 09.07.2010 and the prosecution examined in all sixteen witnesses in support of the charges against the Accused. Evidence adverse to the Accused was put to him under Section 313 of Cr. P.C. to which the Accused denied the entire case of the prosecution and also iled his written statement under Section 313(5) of Cr.P.C.

Heard Mr. Rohan Desai, learned counsel for the Appellant and Ms Asha Desai, Learned Special Public Prosecutor for the respondents. Perused the record and judgments relied upon by the learned counsel for the rival parties.

In support of the prosecution case, the Complainant Rudresh Naik entered into the witness box as PW1 and deposed in support of the complaint lodged by him on 13.07.2009 to the Superintendent of Police, CBI, ACB, Goa.

As per the prosecution, the complainant Mr. Rudresh Sadashiv Naik, is the managing partner of M/s S. Swastik Cruises. he said irm is engaged in the business of river cruises in the state of Goa. He has stated that he had received the notices issued by the Accused during the scrutiny process of the IT Returns of the irm for the Assessment Year 2007-08. He states that the hearing with reference to the said notice was attended by his brother Yogesh Naik (PW2) with their Chartered Accountant namely Rohit Cuncolienkar (PW3). He deposes about his brother Yogesh and CA Rohit informing him that the accused had told them during the hearing that there was a tax liability to the extent of ₹1.5 Lakh and that he would have to pay a bribe of ₹1 lakh so that the tax liability would not be brought on record. He also deposed about the meetings that his brother Yogesh and CA Rohit had with the Accused who reduced his demand from ₹ 1 lakh to ₹60,000/-.

He has further deposed that he was aggrieved with the demand made by the Accused and hence approached CBI oice on 13.07.2009 presenting a written complaint before them praying for necessary action against the Accused. He has further deposed that as part of the veriication proceedings, he visited the oice of the Accused along with pancha witnesses and told the accused that he was willing to pay the bribe amount as required by him. he Accused then assured to convey the time and venue of giving the bribe amount. No demand was made by the Accused at this time.

Later, on the same day, the complainant received a call from the Accused, calling him to a restaurant at Panaji. he complainant along with the raiding party proceeded to the said restaurant, with the thirty notes of Rs.1000/- denomination (aggregating to ₹30,000/-) covered with Phenolphthalein powder in an envelope, where he was joined by CA Rohit (PW3) and Mr Gadge – pancha witness (PW4). hey had a casual conversation and the complainant on his own told the Accused that he was agreeable to give him ₹60,000/- but at the moment he had arranged for only ₹30,000/- and the balance ₹30,000/- will be paid after the order of assessment. After inishing the conversation in the restaurant, as they proceeded downstairs, the Accused gestured to the complainant demanding the cash, where-upon, the complainant removed envelop from the right side pocket of his pant and handed it over to the Accused who took it in his right hand and kept in the left side pocket of his pant. he pre-determined signal was made by the complainant to the CBI oicers who rushed to nab the Accused and conducted the recovery panchanama under which the envelope containing the cash was seized. hereafter, the Phenolphthalein test was done and the ingers of both hands of the Accused changed colour in the test.

During cross-examination, PW1 has made several admissions which are not only inherently self-contradictory but also not in consonance with the evidence of PW2 and PW3 and also contrary to the record. he cross-examination and its analysis will be dealt with hereinafter.

PW 2 Yogesh Naik, deposes that he is the brother of PW1 Rudresh and assists in the family business of the Firm namely M/s. Swastik Cruises. He also assists in maintaining the accounts and dealing with the service and income tax matters. He deposes that in 2008 the Accused had called him for a scrutiny and claiming that the returns were not iled correctly and he would impose a penalty of ₹1,50,000/-. He made an ofer to reduce the tax liability from ₹1,50,000/- to ₹1,00,000/- in case the said amount was paid to him in cash. PW2 requested for some time to discuss the matter with his family.

During cross-examination, he has made several admissions which are not only inherently self-contradictory but also contradict the deposition of PW1. he cross-examination and its analysis will be dealt with hereinafter.

PW3 Rohit Kuncolienkar states that he is a practising Chartered Accountant since 2001. M/s. Swastik Cruises was his client. He had attended the scrutiny assessment done by the Accused for the assessment year 2006-07 and also states that pursuant thereto a notice was issued to the Firm. He deposes that somewhere in May/June 2009, the Accused contacted him and he along with Yogesh PW2 went to meet the Accused. At that time, the Accused told them that the sales were not properly shown and that he wanted some bribe amount to regularize the same. However, he did not specify the bribe amount and asked PW3 to meet him in the following week. Subsequently, when PW3 along with PW2 went and met the Accused, he told them that he wanted ₹45,000/- to ₹50,000/- per year as bribe. When PW2 agreed to pay around ₹50,000/- per year, the Accused demanded ₹60,000/-. Further, PW3 deposes that he was informed by PW1 that they had received the notice from the department pursuant to which again they met the Accused. Although no demand was made by the Accused at this time, while leaving, PW1 told the Accused that he wanted to pay him the money which PW2 had told him about and he also wanted to pay some advance. Further he deposes that Rudresh PW1 again contacted him and asked him to come at Sher-e-Punjab Classic, Panaji (restaurant). All three i.e. the Accused PW1 and PW3 met at the said restaurant, and had casual talks over soft drinks. PW1 told the Accused that he wanted to give him the money but the Accused said to give it later. While coming down from the restaurant, Rudresh PW1 handed over a packet to the Accused. Suddenly there was a commotion and PW3 realized that they were CBI oicers who placed the Accused under arrest. PW3 states that he did not know the contents of the packet till then and later, Rudresh PW1 told him that it contained cash.

Under cross-examination PW3 has made several admissions which are not only inherently self-contradictory but also contradict the deposition of PW1 and PW2. he cross-examination and its analysis will be dealt with hereinafter.

PW4 D. D. Gadagi is the Pancha Witness who has been a pancha to the veriication, pre-trap, trap and post-trap proceedings. He has also been a pancha to the voice transcription and voice specimen panchanamas. He is thus an important witness. He deposes that on 13.07.2009 he reported to the oice of CBI, wherein he was informed that he would be required to act as a pancha witness. He was introduced to the complainant PW1 and the CBI oicers. He deposes that PW1 Rudresh had made a complaint that the Accused, who was a public servant, had demanded bribe of ₹60,000/- for not opening his income tax returns for assessment year 2007-08. He further states that he has put his signatures on the complaint as a pancha witness. hereafter, he along with the CBI oicers and PW1 proceeded to the Income Tax Oice. PW3 Rohit was also called there and he along with PW1 and PW3 went to the cabin of the Accused. He further states that there was some discussion between PW1, PW3 and the Accused wherein PW1 expressed that he is ready to pay the amount that day itself and PW3 said that it can be paid the next day. he Accused then agreed to meet on the same evening.

PW4 further deposed that later, the veriication panchanama was drawn and PW4 put his signatures thereon as a pancha witness. hereafter the pre-trap proceedings started. he CBI oicer demonstrated the use of Phenolphthalein and Sodium Carbonate solution and how it changes colour, etc. he dummy notes were applied with Phenolphthalein powder and kept in the envelope which was also sprinkled with Phenolphthalein powder, which was to be kept in the right-side pant pocket of PW1. he pre-determined signal was decided. While the pre-trap proceedings were going on, PW1 received a call from the Accused and the Accused called him at hotel Sher-e-Punjab at 7.45 p.m. he pre-trap panchanama was also drawn and PW4 put his signatures thereon as a pancha witness. hereafter, PW4 along with the raiding party and the complainant reached hotel Sher-e-Punjab at about 7.30 p.m. Rudresh PW1 called PW3 Rohit and asked him to reach hotel Sher-e-Punjab at about 7.45 p.m. Accused also came there. PW4 and the CBI oicer followed them keeping safe distance. Rudresh PW1, Rohit PW3 and Accused occupied table near the glass window whereas PW4 and the CBI oicer occupied a table near them and the other members of raiding party took positions on the road and the garden. During the conversation on the table, PW1 Rudresh told the Accused that he had agreed to pay ₹60,000/- but at the moment he had brought only ₹30,000/- and the balance he would pay after the order is passed. hereafter PW4 deposes that he saw the complainant making the bill payment and they all started proceeding down to the ground loor through the staircase. He along with the CBI oicer followed them. At that time, the Accused made gesture with his hand to PW1 Rudresh to give the payment. he complainant took the tainted bribe amount which was kept in an envelope from his right side pant pocket with his right hand. Accused accepted the said amount in his right hand, transferred it to his left hand and then put it in his left side pant pocket.

PW4 further deposes that as per the pre-decided signal, the CBI team rushed to the Accused and caught hold of him. he solution of Sodium Carbonate was prepared and the Accused was directed to dip his right hand ingers in the said solution, upon which the colour of the solution turned to pink. Similarly, the envelope was taken out from the left side front pant pocket of the Accused, the currency note numbers were veriied with the pre-trap panchanama and the further sealing and labelling process was carried out. A recovery memo was prepared and the PW4 put his signature thereon as a pancha witness.

PW4 further deposes that since the proceedings had taken place in open space where public had gathered, they proceeded to the oice of SP, CBI where the Accused was placed under arrest. Personal search of the Accused was taken, two mobiles and other belongings found on his person were attached. he conversation in the micro cassette which was on the person of PW1 Rudresh was played. he voice recorder was kept in an envelope and sealed. he transcript of the conversation was prepared and the PW4 put his signatures thereon. Site plan of the scene of ofence was prepared and PW4 put his signature thereon along with the post-trap panchanama.

hereafter, PW4 was again called to the oice of CBI on 18.11.2009 wherein a panchanama of the transcription of the recorded conversation was drawn in the presence of the other pancha witness, CBI staf, Accused and others. PW4 put his signatures on the transcription panchanama. Specimen voice sample of the complainant was taken under a panchanama which also bears the signature of PW4.

Under cross-examination, PW4 categorically states that he did not understand Marathi and Konkani languages. He states that during the trap proceedings some part of the conversation between PW1 Rudresh and Accused that he had overheard was in Marathi and Konkani. He also admits that he did not hear any demand for bribe made by the Accused from the complainant. He further admits that he had heard only some conversation at the time of the veriication and that he cannot say what was the duration of conversation during the veriication. He admits that PW3 Rohit was not a part of raiding party conducting the trap. He candidly admits that the distance between the table where he was sitting and the complainant would be about three feet. From the place where he was sitting he could not hear any conversation between the Accused and PW1 Rudresh. He further admits that in the recorded conversation which was played before him, he had heard the words suggesting demand of bribe but he does not remember those words. He states that around ten to ifteen people were present at the time when Accused was apprehended on the staircase of the hotel.

PW5 Simar Singh Negi, deposed that in the year 2009 he was posted as Commissioner of Income Tax at Panaji. He has proved the sanction order against the Accused and the notiication conferring powers on him as the appointing and removing authority qua the Accused at the relevant time. During cross-examination, he admits that he does not remember which documents he has referred to at the time of passing the sanction order. He does not recall if the CBI had produced a CD of the recorded conversation before him nor had he raised any query regarding the same from CBI. He does not recall if any transcript was prepared in the case or that he had sought any clariications with regard to the same. He has denied the suggestions of the defence that he was not the competent authority to sanction prosecution of the Accused.

PW6 Sunitha K.G. was at the relevant time holding the post of Inspector, Income Tax at Panaji. She deposes about some documents that she had forwarded to CBI.

PW7 Resha Ghadi is a data entry operator working at Income Tax Oice on daily wages. She has identiied the signatures of the Accused on some notices.

PW8 Shivaji Kamble, has deposed that he held the post of Inspector, Income Tax at Panaji at the relevant time, that he had worked with the Accused and hence was conversant with his signatures. He has identiied the signatures of the Accused on some of the documents which were shown to him.

PW9 Deepak Jain is the Manager of Hotel Aroma. He has deposed about the incident on 13.07.2009 when, between 7.30 to 8.30 p.m. he received a call that some people had gathered near the reception and there was some commotion. When he reached there, he was approached by CBI Oicer PI Rishi who asked for the bill paid during the trap proceedings. PW9 handed over the bill to PI Rishi. Under cross-examination he denies that the bill is manipulated and that the bill has been prepared at the instance of CBI.

PW10 Suresh Ajgaonkar has brought on record the service ile of the Accused.

PW11 Dr. Rajendra Singh, Director cum Chemical Examiner, CFSL, New Delhi has proved the forensic voice examination report dated 23.03.2011, wherein after examining the questioned voice recording of the Accused, PW1 Rudresh and PW3 Rohit, with respect to their specimen voices he has opined that their questioned voices tallied with their respective specimen voices. Under cross-examination, PW11 admits that the science of identiication of voice is not 100% fool-proof. He also admits that he cannot give any reason why it is not 100% accurate. He has also admitted that it is possible to manipulate or insert or delete some words or sentences from the SD card with the help of a computer. He has denied the suggestion of the defence that he has prepared the report on the basis of the transcription provided to him by the police.

PW12 Sachin Shinde – Nodal Oicer of Idea Cellular has brought on record the details of the subscriber of cellular no.9822176889 corresponding to Rudresh Naik PW1 and 9822121036 corresponding to Rohit PW3 along with the relevant Section 65-B Certiicate of the Evidence Act.

PW13 V.B. Ramteke, Senior Scientiic Oicer, CFSL, New Delhi has brought on record the report dated 02.03.2010 which gives the positive test for the presence of Phenolphthalein and Sodium Carbonate.

PW14 P. K. Gottam, Senior Scientiic Oicer, CFSL, New Delhi has deposed that he has prepared two copies of each of the micro cassette and micro SD card which were found having conversation which was audible. he CDs were sealed and forwarded back to SP, CBI, Goa. He has further brought on record the photocopies of the correspondence between SP, CBI, Goa and CFSL.

PW15 Rajeev Kumar Rishi, Dy. SP, CBI, Trap Laying Oicer, has deposed about the proceedings of recording the FIR, veriication proceedings, pre-trap, trap and post-trap proceedings, exhaustively. He was cross-examined at length by the defence and the analysis of the cross-examination will be referred to hereinafter.

PW16 Sandeep Chowgule, PI, CBI Goa deposed about conducting of the veriication panchanama. Under cross-examination, PW16 admitted that he conducted the veriication panchanama wherein he collected documents and articles attached during the pre-trap and post-trap panchanamas.

Heard Nitin Sardessai, learned Senior Advocate with Mr Rohan Desai for the Appellant and Ms Asha Desai, Special PP for the Respondent. Perused the impugned judgment and record.

On behalf of the Accused it was strenuously urged that the evidence regarding the demand and the circumstances leading to the trap are palpably unreliable and should be rejected. hat neither the demand nor the acceptance of illegal gratiication by the Accused from the Complainant has been proved by the prosecution beyond reasonable doubt. hat the version of the material witnesses i.e. PW1 Rudresh, PW2 Yogesh and PW3 Rohit is full of material improvements and contradictions which go to the root of the matter casting a serious doubt on the case. hat the prosecution has not succeeded in overcoming the threshold of raising the foundational facts required to invoke the presumption under Section 20 of the PC Act and therefore, there arises no question of rebutting the said presumption. hat the inordinate and unexplained delay in lodging the complaint, failure to prove the demand at the time of veriication and trap, absence of explicit demand in transcripts, unreliable evidence of the Pancha witness (PW4) and trap laying oicer (PW15) leads to an inescapable conclusion that the prosecution has failed to prove its case beyond reasonable doubt. he counsel for the Accused has relied upon several judgments namely:

Countering the submissions of the Accused, the Special PP has argued that the recovery of the tainted cash from the Accused would be suicient to establish the charge against him. She has supported the impugned judgment and order of conviction, contending that the discrepancies and variance between PW1, PW2 and PW3 are trivial in nature, there was no reason for PW3 to falsely implicate the Accused, the discrepancies with regard to the igure of the demand is not of much consequence and hence the Accused has not rebutted the mandatory presumption under Section 20 of the PC Act, justifying the impugned conviction against him.

Re-visiting the evidence led by the prosecution, the aspect of demand can be dealt with in two parts: (a) the initial demand, on the basis of which the complaint was iled and (b) the demand made during the veriication and trap.

he Initial Demand – he prosecution has relied on the evidence of PW1 Rudresh, PW2 Yogesh and PW3 Rohit. It is the case of the complainant that the demand was made initially by the Accused with PW2 who was at the relevant time looking after the inancial matters of their irm, in the presence of PW3 who was the Chartered Accountant of the irm. Describing this incident, PW1 in his complaint states that on 06.07.2009 the Accused called PW3 Rohit in his oice with reference to the pending scrutiny matter. PW3 along with PW2 Yogesh visited the oice of the Accused. Accused told them that he has calculated tax liability of Rs.1.5 lakh towards their irm. he Accused assured PW2 and PW3 that he would not bring this tax liability towards their irm if they pay ₹1 lakh as bribe to him. After negotiation, he agreed to accept ₹60,000/- as bribe. hus, as per the complaint, it is undisputed that the irst demand of bribe was allegedly made by the Accused on 06.07.2009.

PW1 Rudresh has further deposed that he was not present at the said time and hence, PW2 Yogesh told the Accused that he would convey his message of PW1 Rudresh and subsequently, PW3 Rohit informed PW1 Rudresh about these talks on the same day.

It is pertinent to note that this initial demand was made by the Accused pursuant to the notice dated 11.09.2008.

PW1 Rudresh while narrating the same incident states that they were called for speciic scrutiny by the Accused in 2008. hus, he does not speak about any speciic date but says that the alleged demand was made in the year 2008.

Contrary to this, PW3 Rohit says that the Accused had contacted him some time in May/June 2009 and when he along with PW2 went to meet the Accused, the Accused told them that he wanted ₹45,000/- to ₹50,000/- per year as bribe. his amount was negotiated by PW2 Yogesh to around ₹50,000/- per year initially, however Accused demanded ₹60,000/-.

Comparing the evidence of the aforesaid three witnesses on the date of the initial demand, on one hand, the written complaint iled by PW1 before the CBI mentions the date of the initial demand as 06.07.2009 but PW1 in his evidence before the Court states that the demand was made pursuant to the notice dated 11.09.2008. PW2 in his evidence is silent about the date and in fact he does not even mention about the meeting dated 06.07.2009 referred in the complaint. Insofar as PW3 Rohit is concerned, he neither corroborates the version of PW1 nor PW2 but he gives a totally new version wherein he says that the alleged demand was made for the irst time in the month of May/June 2009. hus, there is no unanimity in the evidence of PW1, PW2 and PW3 regarding the irst demand made by the Accused. Assuming the version given by PW1 and PW2 to be correct, there is still a delay of more than ten months in lodging the complaint. Even going by the version of PW3, ignoring the version of PW1 and PW2, still there would be a delay of almost thirty to sixty days in lodging the complaint. he delay is inordinate and has not been explained by the complainant or the prosecution.

he actual nature, amount and words of demand: In the evidence of the Complainant, he states that the Accused demanded Rs.1 lakh as bribe. In the complaint dated 13.07.2009, PW1 Rudresh has stated that this amount of Rs.1 lakh was negotiated and the Accused agreed to accept ₹60,000/-as bribe, whereas, PW3 Rohit comes up with an absolutely diferent theory. He states that the Accused demanded ₹45,000/-to ₹50,000/- “per year” as bribe, which after negotiation was changed to ₹60,000/-. hus, there is complete variance between the material witnesses PW1 and PW3 insofar as the bribe amount is concerned. In fact, the theory of demand of bribe “per year”, does not stand to any reason. he scrutiny was admittedly for the assessment year 2007-08 so there was no occasion or reason for demanding bribe every year. Importantly, PW3 under cross-examination, clearly admits that he does not recollect whether he had stated to the CBI that the Accused had demanded bribe to regularise the sales which were not properly shown. He also admits that he does not recollect whether he had stated in his statement to CBI that the Accused wanted ₹45,000/- to ₹50,000/- per year as well. hese contradictions and omissions establish the lack of credibility of PW3.

Insofar as PW2 is concerned, he states that in 2008, when they were called by the Accused, who kept on insisting that he would impose a penalty of ₹1.5 lakh and made an ofer to reduce the liability to ₹1 lakh in case the amount was paid to him in cash. Under cross-examination, he admits that he did not state to the CBI that the Accused made an ofer to reduce the liability to ₹1 lakh. hus, he resiles from his earlier statement under cross-examination. his omission goes to the root of the matter, suggesting that the theory of demand was only an afterthought. hus, PW1 and PW3 do not corroborate each other’s evidence in material particulars regarding the demand. In fact, there are serious contradictions in the evidence of PW2 and PW3 as regards the amount, time and place of the demand. Moreover, the entire evidence of PW1 regarding the initial demand is hearsay. Taking a cumulative perspective, it is diicult to believe the prosecution version of the initial demand made by the Accused.

Failure to prove demand at the time of veriication: he veriication proceedings are borne out by the veriication panchanama, which was proved by the pancha witness PW4. he veriication panchanama even taken at face value, records that when PW16 (IO) asked the Complainant PW1 as to what had happened when he met the Accused in the cabin to which, PW1 informed that it was he who said that he was ready to pay the bribe. He has nowhere stated that the Accused demanded bribe or money from him or that the Accused had agreed to accept the bribe. his fact is in consonance with the transcript of the recording where again taking the transcript at face value, there is not a single reference to any demand by the Accused.

PW1 in his evidence regarding the veriication and trap proceedings also states that there was no demand for bribe by the Accused in the chamber during veriication but only inalization of the venue for delivery of the bribe amount was done during veriication.

PW3 while deposing about veriication and trap has stated that while leaving the cabin of the Accused the Complainant Rudresh told the Accused that he wanted to pay him the money which PW2 had told him about. hus, even PW3 does not mention anything about the demand of the bribe during the veriication proceedings.

PW4, the pancha witness, while deposing about the veriication proceedings states that there was discussion between the Accused and PW1 and PW3. However, even he does not categorically state that there was any demand made by the Accused at the relevant time. It is also pertinent to note that during the hearing of the conversation recorded at the time of the veriication, some part of the conversation was in Marathi and Konkani and that PW4 did not understand either Marathi or Konkani languages. He also states that he did not hear any demand for bribe made by the Accused to the Complainant.

PW15, the trap laying oicer has candidly admitted that prior to the veriication, he did not make any enquiries about the demand as disclosed by the Complainant from his brother PW2 or PW3 before proceeding for veriication. He also admits that there was no demand from the Accused during the veriication process. hus, he also corroborates the fact that there was no demand made by the Accused during the veriication process.

PW16 also admits that there was no direct demand which was disclosed by the Complainant during the veriication process.

It is the case of the prosecution that the Accused had allegedly made a phone call to the Complainant regarding the venue of accepting the bribe. his has been canvassed by the counsel for the CBI as an incriminating material against the Accused. However, analysis of the evidence reveals otherwise. PW1, under cross-examination, clearly states that there was no reference to the bribe amount during the telephonic call by the Accused to PW1. PW3 has also not stated anything about any phone call or alleged demand made by the Accused on the phone. PW4, the Pancha witness, has stated that from the conversation between the Accused and PW1, it was gathered that the Accused called the Complainant at hotel Sher-e-Punjab. hus, even PW4 does not whisper anything about alleged demand on the phone. he IO and the trap-laying oicer, both, have also not made any reference to any demand made by the Accused during the telephonic conversation.

he transcripts of the conversations recorded during the veriication and the pre-trap proceedings clearly indicate absence of any explicit demand made by the Accused.

In the wake of the aforesaid facts, it is diicult to hold that the Accused made any demand as alleged during the veriication process.

No demand during the trap proceedings: he trap was laid at hotel Sher-e-Punjab where PW1 Rudresh, PW3 Rohit and the Accused were having a discussion. Referring to this, PW1 in his evidence states that they had a general conversation during which he told the Accused that he had agreed to give ₹60,000/- but at the moment he had only arranged ₹30,000/- and the balance of ₹30,000/- would be paid to him after the order of assessment. PW3 while commenting about the same incident reiterates the deposition of PW1 Rudresh and states that PW1 told the Accused that he wanted to give him the money but the Accused said to give it later. PW4 the pancha witness commenting about the same incident in his evidence reiterates the statement of PW1. PW15, the trap-laying oicer who was also present corroborates the statement of PW1.

Examining the depositions of all the aforesaid witnesses, by no stretch of imagination it can be inferred that the Accused had demanded bribe from the Complainant. Rather, it seems from the tenor of the conversation that PW1 has ofered some money to the Accused which ipso facto cannot be construed to mean that the Accused had made a demand for illegal gratiication during the course of the discussion during the trap proceedings.

his fact is further reinforced by the evidence of PW15, the trap-laying oicer who in his evidence speciically states “there is no speciic demand of bribe made by the accused during the time he along with the complainant were sitting on the table in the hotel for around one hour”. his fact is fortiied by the evidence of PW4 pancha witness who states that “the distance between the table where I was sitting and the complainant would be about 3 feet. From the place where I was sitting I could not hear the conversation between the accused and the complainant. I had occasion to hear the recorded conversation between the accused, complainant and the CA in the hotel. In the recorded conversation I had heard the words suggesting the demand of bribe of money. I do not remember said words.”

It is the case of the prosecution that PW15 and PW4 were the independent witnesses who were sitting at the table near the table where the discussion was taking place, and hence their evidence assumes signiicance. PW15 categorically states that there is no speciic demand of bribe, whereas PW4 states that he could not hear the conversation between the accused, PW1 and PW3. Even later on, while hearing the recorded conversation, he could not remember the words suggesting the demand of bribe money.

his clearly demolishes the case of the prosecution that the demand was made during the trap proceedings.

It was strenuously argued by the Accused that the entire process of laying a trap was improper. It was submitted that the trap-laying oicer should have ensured that the pancha witness was properly introduced to the Accused. he fact that the Accused was a total stranger to the pancha witness creates a reasonable doubt about the fairness of the trap proceedings. It was urged that there was no speciic demand or ofer in the pre-trap conversation and even taking the discussion during the trap proceedings at face value, the only inference that perhaps can be arrived at is that bribe amount was ofered by the Complainant and not demanded by the Accused. he above discussion and analysis of evidence supports this contention of the Accused.

It is pertinent to note that the Accused has set up his defence in the statement under Section 313 of the Cr.P.C. by way of further explanation in writing which is exhibited by the learned Sessions Court. he defence of the Accused, which has to be tested on the preponderance of probability appears to be that he was falsely implicated in the present case. He states that the Income Tax Department has devised a procedure known as CASS (Computer Assisted Selection of Scrutiny). In this procedure, a case is selected for scrutiny randomly out of the submitted income tax returns. his is done by the Delhi Oice of Income Tax. Once the case is selected, it is taken for veriication of books of accounts by the jurisdiction oicer of the concerned ward. As part of this procedure, the case of M/s Swastik Cruises was selected along with other cases for veriication for the AY 2007-2008. he Complainant-PW1 and PW2, were known to the Accused. hey used to meet the Accused for oicial work and he knew that Complainant-PW1 is partner of M/s Swastik Cruises. he Accused had casually mentioned to him that there is a lot of rush for going on a cruise and people have to wait for long time in queue, upon which the Complainant informed the Accused that if he or his family members ever wanted to go on a cruise, he should inform the Complainant. On 13.07.2009, in the evening, the Accused informed PW1 that they would be going on cruise to which PW1 replied that he will take care of the same.

On the same day at the invitation of PW1, the Accused had joined him for dinner and drinks at hotel Aroma Sher-e-Punjab. At the relevant time, the Accused had a couple of drinks at the insistence of PW1 and PW3. He further states in his defence that after coming down from the restaurant a lot of persons were gathered, there was a commotion and he did not understand what was happening. Some persons suddenly apprehended him and pushed a packet in his pant pocket forcefully. Subsequently, he was told that he was arrested in a crime.

he Accused further states that the Complainant PW1 Rudresh was entertaining a grudge against the Accused since he had an impression that the Accused had deliberately selected his case under CASS and hence, PW1 has falsely implicated him.

Before proceeding to examine whether the prosecution has discharged the burden of proving its case beyond reasonable doubt, it would be relevant to emphasise that the Hon’ble Supreme Court in a series of judgments and most recently in the case of Neeraj Datta v/s. State (Govt of NCT of Delhi) (supra) has reiterated that in order to bring home the guilt of the accused, the prosecution has to irst prove the demand of illegal gratiication and subsequent acceptance as a matter of fact. Proof of demand and acceptance of illegal gratiication by a public servant is a sine qua non in order to establish the guilt of the public servant. he presumption of fact with regard to the demand and acceptance or obtainment of an illegal gratiication may be made by a court of law by way of an inference only when the foundational facts have been proved by relevant oral and documentary evidence and not in the absence thereof.

In the case of P. Satyanarayan Murthy v/s. District Inspector of Police (supra), the Hon’ble Supreme Court observed thus:

he three cardinal principles of criminal jurisprudence are well settled and in the case of Sri Rabindra Kumar Dey V/s. State of Orissa AIR 1977 SC 170, they are highlighted as under:

In so far as the presumption under Section 20 of the PC Act is concerned, it is indisputably the presumptive evidence. However, the Hon'ble Apex Court in the authoritative pronouncement of State of Maharashtra V/s. Dnyaneshwar Laxman Rao Wankhede (2009) 15 SCC 200, has held that before the accused is called upon to explain as to how the amount in question was found in his possession, the foundational fact of demand must be established by the prosecution. Even by invoking provisions of Section 20 of the Act, the Court is required to consider the explanation ofered by the accused, if any, only on the touchstone of preponderance of probabilities and not that of beyond a reasonable doubt.

Revisiting the facts of the present case, the cumulative efect of the serious and material contradictions, improvements and omissions in the evidence of the PW1, PW2 and PW3, on the vital aspect of the initial demand, its nature and its amount is that their evidence is unreliable and cannot be accepted. he prosecution has also not proved the factum of demand during the veriication, pre-trap and trap proceedings as highlighted from the aforesaid discussion.

Since the entire ediice of the prosecution case rests on establishing the demand of illegal gratiication, the prosecution has not succeeded in overcoming the threshold of raising the foundational facts required to invoke the provision of Section 20 of the PC Act and hence, there arises no question of rebutting the said presumption. Since the prosecution has failed to establish the demand of illegal gratiication, a sine qua non in order to establish the guilt of the Accused under Section 7 and Section 13(1)(d) r/w 13 (2) of the PC Act, mere recovery of currency notes even assuming to have been proved by the prosecution, de-hors the foundational fact of demand would be of no consequence.

Re-visiting the impugned judgment, it is seen that the learned Sessions Court has failed to consider the material contradictions, improvements and omissions in the evidence of the prosecution witnesses i.e. PW1, PW2 and PW3 on the vital aspects of the initial demand, its nature and amount. he Court has erred in not considering the failure of the prosecution to prove the demand at all stages i.e. the initial demand prior to the complaint, the demand if any, made during the veriication process and the demand made during the trap proceedings. he learned Sessions Court has not considered the explanation given by the Appellant in the statement recorded under Section 313 of Cr.P.C. and the written explanation given therein on the touchstone of the preponderance of probability while considering the defence of the Accused.

he learned Sessions Court has invoked the presumption under Section 20 of the PC Act without giving any reasoned inding as to whether the prosecution had succeeded in laying the factual foundation for the same or not. he learned Sessions Court has observed that the Accused, being well-educated and had suicient experience how to discuss things and it is not possible to get from the mouth of the Accused the speciic words of demand of illegal gratiication. he Court observes that the Accused being an Income Tax Oicer was supposed to deal with such matters in his oice only. He was not supposed to be in a hotel on a dinner table enjoying liquor with the partners of the said irm. his itself shows that the Accused agreed to meet them outside his oice premises not for the purpose of assessment of income tax returns but for the purpose of some favour or advantage to be taken from the said irm which is beyond his oicial duty. he learned Sessions Court holds that normally, it is diicult to prove a direct conversation of demand and therefore, in such matters the court has to infer such talks which are out of context of the core issue to evaluate such material for the purpose of conirmation of demand of gratiication. In my considered view, these observations of the Sessions Court would be in the nature of inferential surmises and conjectures which cannot substitute the cogent and reliable material with probative value, which the prosecution has failed to bring forth.

Dealing with the submissions of the counsel for CBI, from the aforesaid discussion it is evident that the discrepancies and variance in the testimonies of PW1, PW2 and PW3 are not trivial in nature. In fact, they are so divergent and materially inconsistent that they go to the root of the matter. Assuming that the fact of recovery of the tainted notes is taken again the Appellant, even then it is a settled position of law that mere acceptance of any amount de hors the proof of demand, ipso facto would not be suicient to bring home the charge under Sections 7 and 13(1)(d) r/w 13(2) of the P.C. Act.

hat, the prosecution has relied on the transcript of the alleged conversation which took place during the veriication proceedings, the phone call during the pre-trap proceedings and the conversation which took place during the trap proceedings at hotel Sher-e-Punjab. he prosecution has also relied on the report of the voice identiication expert who has opined that the disputed voice and the voice of the Appellant is the same.

Although, the prosecution has failed to cross the threshold of proving by cogent evidence the demand for illegal gratiication and its consequent acceptance and on this ground alone the prosecution has failed to prove its case beyond reasonable doubt. In any event, even the electronic evidence relied upon by the prosecution sufers from serious lacunae. It is a settled position of law that when reliance is placed on a tape recorded conversation, it can only be used as corroborative evidence of conversation and in the absence of the actual evidence of such conversation, the tape recorded conversation cannot be relied on.

In the case of Ram Singh v/s. Col. Ram Singh - 1985 Supp SCC 611, the Hon’ble Supreme Court has laid down the conditions for admissibility of tape recorded statement after analysing judgments rendered in that context. In the said judgment, the Hon’ble Supreme Court held as follows:-

he aforesaid position of law makes it clear that tape recorded conversations in evidence can be taken into consideration by the Court after the aforementioned safeguards are followed.

Also in this regard, rules for production, use and recording of tape-recorded evidence in court, which are framed under Article 227 of the Constitution of India and incorporated in the Criminal Manual issued by this Court, clearly stipulate that the party producing the tape-recorded evidence shall also produce a transcript thereof along with the tape. It also stipulates that the court or such oicer shall hear the tape-recorded evidence in order to verify whether the transcript produced along with the tape is correct or not and endorse such veriication on the transcript record under his signature with date. Rules also provide the manner in which the tapes are required to be kept in safe custody under the seal of the Court.

Dealing with the electronic evidence relied upon by the prosecution, at the outset, the prosecution has failed to establish that the rules dealing with the tape-recorded evidence as prescribed in the Criminal Manual were followed. here is no record to suggest that prior to the recording of evidence, the exercise of hearing the tape-recorded evidence, verifying it with the transcript and endorsing such veriication on the transcript of the tape-recorded evidence was carried out by the prosecution. he original micro cassette consisting voice recording during veriication was not audible and voices were not identiied in Court. he original recording which allegedly took place in hotel Sher-e-Punjab was not audible and could not be identiied in Court. he voices which were identiied were from the CDs made from the original recordings. he recording was done on 13.08.2009 and was identiied after six years i.e. on 12.03.2015. It is diicult to believe that it was humanly possible to identify the voices after such a long gap. Moreover, the original recording devices, though sent to the scientiic expert, were not checked as to whether they were in proper condition or not. Under cross-examination, the voice identiication expert has stated that the science of identiication of voice is not 100% foolproof and it is possible to manipulate the words or sentences in a conversation with the help of a computer. Taking a cumulative view of the electronic evidence, it is clear that the prosecution has not adhered to the guidelines of the Hon’ble Supreme Court in maintaining the sanctity of the tape-recorded conversations and hence the same is not reliable.

hus it becomes clear that in the absence of cogent evidence to prove demand of illegal gratiication, the Sessions Court could not have convicted and sentenced the Appellant under the provisions of Section 7 and Section 13(1)(d) r/w 13 (2) of the PC Act.

In view of the above, I ind that the impugned judgment and order passed by the learned Sessions Court is unsustainable.

Appeal is allowed.

he Impugned judgment and order dated 24.10.2016 is quashed and set aside.

Appellant is acquitted of the ofences under Section 7 and Section 13(1)(d) r/w 13 (2) of the PC Act.

Bail bonds of the Appellant shall stand discharged.