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IN THE HIGH COURT OF KARNATAKA AT

BANGALORE
(Memorandum of Criminal Appeal under Section 374(2) of
Cr. P. C. read with Sec. 27 of the Prevention of Corruption
Act 1988.

In the Court of the Spl. Judge XXXVI Addl. City Civil and
Session Judge, Bangalore

Spl C.C. No. 208/2004

IN THE HIGH COURT OF KARNATAKA AT
BANGALORE


CRIMINAL APPEAL No. /2014


Rank of the Parties
Sessions Court/High Court
Between:

Selvi J Jayalalithaa
D/o Jayaram,
Aged 66 years,
81/36, Poes Garden,
Chennai 600 086. 1
st
Accused / Appellant

And:

State, by the Superintendent of Police,
Vigilance and Anti-Corruption
Special Investigation Cell
Chennai 600 006 Complainant/Respondent





The above named Appellant states as follows:



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1. The address of the Appellant for the purpose of service of
notice, process, is that of the counsel S.Senthil, K. C. Paneerselvam
________________________________________________________,
from this Honble Court is as stated above and that of her Counsel.

2. The address of the Respondent for the aforesaid purpose is as
shown in the cause title.

3. Being aggrieved by the judgment and order of Conviction dated
27.09.2014 in Spl. C.C. No. 208/2004 passed by the learned Court of
the Spl. Judge XXXVI Addl. City Civil and Session Judge, Bangalore,
for the offences punishable under Section 13(1)(e) read with Section
13(2) of the Prevention of Corruption Act, 1988 and Sec 109 read
with 120 B of I.P.C., whereunder the learned judge has convicted A-1
for the offence under sec.13(1)(e) r/w sec 13(2) of the Prevention of
corruption Act 1988, and sentenced her to undergo for a period of 4
years of simple imprisonment and a fine of Rs.100 crores and in
default to pay the fine amount, to undergo further imprisonment for 1
year and for the offence punishable u/s 120-B I.P.C., R/w Sec 13(2) of
P.C. Act, she is sentenced to undergo simple imprisonment for 6
months and to pay a fine of Rs.1 lakh and in default to pay the fine, to
undergo further imprisonment for 1 month on the following among
other grounds. The copy of the judgment is produced as ANNEXURE-A.




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FACTS OF THE CASE

4. The Appellant states that she is the General Secretary of All
India Anna DMK and she was holding the post of Chief Minister of
Tamilnadu during the years 1991 to 1996. The Appellant demitted
office as chief minister of Tamilnadu in May 1996. Subsequently the
Political opponent of the Appellant viz., the DMK party came to
power and a case in Crime No. 13/AC/96/HQ was registered on
18.09.1996 against Appellant herein and 3 others for the alleged
offences under section 13(2) R/W 13(1) (e) of Prevention of
Corruption Act and after investigation charge sheet was filed on
04.06.1997 before the Special Judge, Chennai against them. At this
juncture it is also relevant to note that initially a private complaint was
filed by one Dr. Subramanian Swamy(PW 232) to prosecute the
Appellant under the provisions of Prevention of Corruption Act 1988.
The learned Principle Session Judge directed an enquiry under Section
202 Cr. P.C. However without permitting the enquiry to be concluded,
the then Government directed Inspector General of Police one V. C.
Perumal (PW 241) to register an FIR on 18.9.1996.

5. The Appellant submits that the Respondent has alleged that she
has acquired pecuniary resources in her name and in the names of A-
2, A-3 and A-4 and in the names of various companies floated by her
and to the tune of Rs. 66,65,20,395/-, which are disproportionate to



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her known sources of Income during the check period 01.07.1991 to
30.04.1996.

6. The Trial of the above case commenced before the Spl. Judge at
Chennai in Spl.C.C. 7 of 1997 and when it was in progress, the
political opponent of the Appellant moved the Honble Apex Court
for transfer of the case from Chennai and consequently the case was
transferred from Chennai to Bangalore in the year 2003 and
renumbered as Spl. C.C. 208/2004. As the proceedings pertaining to
transfer of the above case from Chennai to Bangalore are all matters
of record, the Appellant is not dealing with the same herein for the
sake of brevity.

7. The Respondent/prosecution has examined 259 witnesses and
marked 2341 exhibits. Also Ex. X1 to Ex.X24 and Ex. C1 to Ex.C3
were marked as Court exhibits. Material objects were also marked in
this case.

8 On behalf of the accused, they examined 99 defense witnesses
and marked 384 exhibits on there behalf. After the trial, the Spl. Court
pronounced the judgement on 27
th
September 2014 and sentenced A-1
to the periods which have been referred to earlier.






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GROUNDS

9. The judgment and conviction passed by the learned Spl Judge
is erroneous and contrary to law, weight of evidence and facts of the
case and has resulted in great miscourage of justice. The learned Spl.
Judge has erred in appreciating the evidence in a proper perspective.

10. The learned judge has omitted to take into account the income
and resources available to the accused during the check period.
11. The Learned Judge has failed to see that the income pleaded by
the accused have all been accepted by the income tax authorities right
upto the level of Income tax Tribunal.
12. The learned judge has also failed to see that the findings
rendered by a judicial forum has an effect and force and could not be
brushed aside in a manner as has been done by the learned Spl. Judge.
13. The learned Judge has failed to see that huge expenses
attributed to this Accused have not been established much less by
proof beyond reasonable doubt.
14. The learned Judge has failed to see that the Appellant has
proved her defense with overwhelming evidence and the Income tax
Department itself having gone into the question of her income has
accepted it to be true and genuine. Since the burden of proof on the
Accused is only preponderance of probabilities, the lower Court ought



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to have held the Appellant not guilty, especially when on the same
parameters, the income tax department has accepted the income of the
Appellant.
15. The lower Court ought to have held that the findings rendered
by the income tax department would be binding on it. Therefore the
Judgment is vitiated on account of serious mis-directions in law.
16. The learned Judge has failed to see that the Appellant acquired
only one property and made a renovation and only two constructions
which also have been duly accounted for in the Income tax Returns
and accepted by them. As regards the properties in the name of others,
the prosecution has not proved the benami nature of holding.
17. The learned Judge has failed to see that no evidence worth the
name has been adduced by the Respondent to prove the alleged
conspiracy and abetment. The lower Court allowed itself to be carried
away by presumption, assumption, conjectures and surmises and has
erroneously and wrongly concluded that there was conspiracy and
abetment.
18. The lower Court ought to have seen that mere association of
persons could never lead to conclusion of either conspiracy or
abetment.



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19. The learned Judge has overlooked the very many grave
irregularities in the registration of the case as well as investigation and
in the filing of the final report.
20. The learned Judge has overlooked various infirmities in the
prosecution case as well as the insufficiency of evidence in the
prosecution case which were all pointed out to him in great detail.
21. The learned Judge has failed to see that the entire case, right
from its inception has been engineered by the political opponent of the
Appellant, which on the face of the case of the prosecution itself is
patent and obvious.
22. The learned judge ought to have held that the income of Jaya
Publications by way of subscription can never be treated as the
income of the Appellant.
23. The learned Judge has failed to see that the prosecution has
purposely either boosted or under stated the figures to suit to its
connivance.
24. The learned Judge has though noted that very elaborate
submissions were made on behalf of A-1 on the illegalities in the
registering the FIR, the proceedings under Sec.202 Cr.P.C and during
the course of the investigation, has failed to discuss each one the
illegalities pointed out and the consequences flowing therefrom.



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25. The learned Judge failed to see that the materials collected
during the enquiry under sec.202 Cr.p.c have been relied upon when
the final report is filed u/s 173(2) of the code. This procedure is wrong
for the following reasons. Apart from the reasons it involves two
grave violations
[a] The evidence/materials collected during the course of enquiry have
been used in the final report as if it is an investigation done under
chapter 12 of the code. Thus, the learned Judge taking cognizance of
the case, had been informed that 98% of all documents and statement
of 300 witnesses were collected during the enquiry u/s 202 and
therefore they cannot be considered as materials gathered during the
investigation then the Learned Judge could not have taken cognizance
of the case at all.
[b] The accused has been also misled until the examination, at the
fag end of the trial, when (Pw.240) and (Pw.259) were examined that
they did not form part of the investigation done under the chapter 12
of the code. The learned Judge, though noticed the violations has
submitted in the arguments as not given any finding in this regard or
shown how despite the grave mistake the proceedings are still valid.
26. The Learned Judge has failed to see that the proceedings in the
complaint of (PW.232) Dr. Swami u/s. 202 is also gravely violative of
the code.



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27. The Learned Judge failed to see that sec.202 enquiry is not to
be treated as an investigation under chapter 12 of the code. The object
of the enquiry is only to find out if the complaint is true or false. The
object can never be to investigate or to support the complaint of the
private complainant.
28. The learned Judge therefore failed to see that the gathering of
documents and recording statement of 300 persons in the enquiry
u/s.202 is wholly invalid.
29. The Learned Judge has failed to see that the materials gathered
are all contrary to the investigation and the safeguards provided
therefore under the code.
30. The learned Judge failed to see that it is an admitted case that
under the guise of enquiry u/s.202. Documents have been collected
from banks, financial institutions, registration departments and from
company law authorities pertaining to all the accused of this case. All
this were gathered without a search list and without a mahazar. These
facts have been admitted by Pw.240 herself.
31. The Learned Judge failed to see statements of 300 persons
including bank officers have been examined in this case but without
following safeguards under the code.
i). The witnesses are not shown to have been examined u/s.161 of the
code.



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ii). When examined u/s.161 the person is forbidden by law to speak
the truth.
iii). Under the code a police officer is forbidden from offering any
inducement or threat to the witness.
iv). The power to examine a person u/s.161 can only be exercised
when proceedings are taken after registering the FIR under chapter 12
of the code. Thus, the violations of the code are patent.
32. The Learned Judge failed to see materially erred in marking
stating that no witness examined u/s.300 were examined as
prosecution witnesses during the trial. This statement is factually
incorrect. More than 10 witnesses has been examined including
Pw.232 Dr. Swami who had originally given the complaint before the
Sessions court in pursuant to which the enquiry u/s.202 was ordered
by the Principal Sessions Judge.
33. Further, the documents gathered during the enquiry u/s 202
have also violated the provisions of P C Act. Under this ACT to
investigate a person must have a specific authorization u/s 17 of the
Act. If he wants to investigate any bank then there must be a specific
authorization u/s 18 of the Act admittedly the persons who collected
the documents from the banks were never authorized u/s 18 of the
Act. Thus there is total violation of not only the code but also the P C
Act.



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34. The learned Judge has not examined the fact that for almost
98% of the documents marked in this case there have been no
Mahazar or Search list and the consequences resulting in the invalidity
in using such documents, it is submitted the entirety of the documents
produced by the prosecution is therefore, liable to be discarded.
35. The learned Judge materially erred in stating that all these
objections have been earlier considered and rejected. Such a theory is
wrong if only because the defects came to be light only when PW 240,
241 and 259 were examined at the fag end of the trial itself.
36. The learned Judge failed to see that registration of an FIR can
only be by SHO. Even assuming that DV and AC is a police station
[for which prosecution has not produced any document] still the
Director of DV and AC PW 241 could never register an FIR.
37. The learned Judge failed to see that V C Perumal PW 241 is a
Chief of DV and AC and Superior to PW 259. Hence, he is in the
nature of appellate authority to correct any action or inaction of the
original authority namely PW 259. Such appellate authority himself
cannot exercise the powers of the lower authority on whom the code
has conferred certain powers to register a cognizable case. The
Supreme Court Judgment in this regard though cited has been ignored
by the learned Judge.



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38. The learned Judge failed to see that PW 241 clearly admitted
that he registered the FIR has the Government had passed a three page
order requiring him to register the FIR against the A-1. Thus PW 241
not only taken over the discretion of PW 259 he had surrendered the
discretion vested in him and acted at the behest of an outside authority
like the Government.
39. The learned Judge failed to see that on account of this the FIR
registered by PW 241 makes a strange reading showing that it was not
registered by PW 241 and copy given to PW 241 himself as an
informant.
40. The learned Judge is in grave error in thinking that
illegalities/irregularities do not matter unless the accused is able to
establish that she is prejudiced infact on account of such irregularities.
The approach of this learned Judge is clearly wrong and contrary to
the code and the decisions cited before him.
41. The learned Judge failed to see that the concept of the prejudice
could be examined only in an appeal or revision and when any
irregularity is pointed out during the course of trail plainly a duty is
cast on the trial court to remedy the same. It is submitted that all or
any one of the grave defects in the procedure vitiates the prosecution
case.



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42. The learned Judge failed to see that since 1971, the case of
Sirajudeen vs State of Tamil Nadu, the Honble Supreme Court of
India has laid down that before registering a case under P C Act
particularly against the persons who held High Offices their must be a
preliminary enquiry and decision must be taken whether or not to
register the FIR. In this case, there has been no preliminary enquiry at
all.
43. The learned Judge failed to see that this has two aspects [a]
there must be a preliminary enquiry [b] that preliminary enquiry
materials must be viewed by some other person preferably a superior
and prima facie conclusion must be drawn whether or not to register
the FIR. In this case, no prosecution witness says he conducted the
preliminary enquiry, no witness for the prosecution says that he
concluded on the basis of any such preliminary enquiry that there was
a necessity to register an FIR.
44. The learned Judge failed to see that as stated earlier, the FIR
itself was a registered at the behest of the Government.
45. The learned Judge failed to see that after Sirajudeens case in
1971 a constitution Bench of Supreme Court of India in Lalithakumari
vs Government 2014[2] SCC page 1 has again stated that such a
preliminary enquiry is necessary. The decision in Sirajudeens case
was quoted and approved.



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46. The learned Judge failed to see that it is now an established
position in law that the manual governing the investigative agency
must also be strictly followed. If not the subsequent proceedings
should be invalid. The accused have marked Exb. D.384 which is the
manual of DV and AC paragraph 81 specifically requires a
preliminary enquiry to be conducted before the registration of FIR.
Thus on both the aspects non holding of preliminary enquiry itself has
vitiated the trial.
47. The learned Judge unfortunately has quoted Lalithakumari as if
it is a statement of PW 259. Thus paragraph 34.12 of the judgment is
not only wrong serious misleading and total failure to consider the
vital point of law which itself would have the effect of invalidating the
trial itself.
48. The learned Judge has wholly misunderstood the arguments
relating to proceedings u/s 202. The proceedings u/s 202 was
deliberately exceeded by the Police so that the safeguards available
during the investigation or not observed. To frustrate the learned
Principal Session Judge, Chennai who had ordered the Investigation
u/s 202 from passing orders thereon, the prosecution did not file any
report before the Principal Session Judge, Chennai thereby prevented
the learned Judge from passing any order which might be one
dropping the proceedings thus the prosecution has practiced a fraud
upon the court. The learned Judge totally misunderstood the



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arguments addressed before him and failed to consider the serious
objections raised before him.
49. The learned Judge has also failed to consider in proper
perspective the arguments of lack of authorization u/s 17 and 18 of
P.C Act to the Police Officer to investigate an Offence u/s 13(1)(e) of
the Act.
50. The learned Judge failed to consider the detailed arguments
addressed in this regard but has blindly overlooked the serious
violations by the prosecution.
[i] The first question is whether there wasauthorization to the
Officers who have taken part in investigation of this case u/s 17 or 18
of the Act.
[ii] If such authorization exists whether it is valid in law. The
learned Judge has failed to pose proper question and therefore has not
reached the proper conclusion.
51. The learned Judge failed to see that the authorization under
Exb. P.2265 is given only u/s 17 of the Act and therefore PW 259
could not have done any investigation relating to bank records.
Whereas he did so.
[i] This authorization is also invalid as he does not give any reason
why the authorization is been given by PW 240. Decisions have



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uniformly held that without reasons ex-facie the authorization would
be invalid.
52. The learned Judge failed to see that in respect of the
authorization given by PW 241 there also invalid has they do not give
reasons. Secondly, it is not even mentioned in the authorization has to
whom the authorization is being given. Further, no authorization u/s
18 of the Act is marked. Thus, there has been no valid authorization at
all in this case.
53. The learned Judge failed to see that the decision report in State
vs Surya Shankaram Karri 2006[7] 172 is an authority for the
proposition that invalidity or the lack of an authorization u/s 17 or 18
of the Act would vitiated the trial as if it would render the proceedings
invalid.
54. The learned Judge failed to see that Exb. P. 2309 and Exb.P.
2267 to 2272 are invalid for both the above stated reasons.
55. The learned Judge, it is a matter of serious consternation, as
remarked that PW 249 has buckled under pressure and disowned his
own statement. The learned Judge could not have pleaded for the
prosecution. It is settled law that where a prosecution witness deposes
then it must be taken and would be used against prosecution unless he
is declared hostile and cross examined to impeach the testimony.



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56. The learned Judge by the above process of reasoning has failed
to examine whether the authorizations above referred to is valid or not
and the invalidity pleaded by the accused have remained unexamined.
57. The learned Judge in paragraph 35.20 has concluded that the
argument that PW 259 had no authorization is not correct and he had
been duly authorized u/s 17 and 18 of the Act is not only incorrect on
fact but wholly misses the point that the authorization is invalid.
Further, the lack of authorization for number of officers who
investigated this case remains unanswered.
58. The learned Judge though has mentioned the various decisions
cited in this regard has not even chosen to say what though judgments
hold nor the learned Judge has attempted to follow the same.
59. The learned Judge ought to have come to the conclusion that
there has been no valid authorization to any of the officers who
investigated this case and also to PW 259. Hence, following Surya
Shankaram Karri case the proceedings are invalid.
60. The learned Judge ought to have held that the charges has
framed is clearly invalid, as they are vague and indefinite. The further
observations in the judgment in paragraph 36.5 that there is no
necessity to specify the individual instances of acquisition of property
or modus operandi adopted by the accused, it is submitted, is a clear
mistatement of law.



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61. The learned Judge failed to see that the charge
mentioned 32 firms said to have been floated by A2 to A4.
[a] This is clearly invalid as even the charge sheet mentions more
than 32 firms of which six are registered companies.
[b] Law knows the difference between a firm and the company.
Company has never be described as a firm.
[c] Charges must be a stand alone document. It has been viewed
and understood on its own.
[d] The crucial words are 32 firms floated by A2 to A4 during the
check period. All the six companies are not floated by A2 to A4. In
fact some of them were Directors without even being Shareholders for
a brief period. Hence, plainly charge cannot include those companies.
[e] The firms of Jaya Publications and Sasi Enterprises were in
existence early to the check period. They also must stand excluded on
a plain reading of the charge. Above factors show the charge has not
given the accused a proper case to meet. What is not plainly covered
in the charges as framed has been sought to be included in this case.
62. The learned Judge failed to see that the second charge mentions
that A1 is holding substantial extent of properties in the names of A2
to A4 and 32 firms floated by A2 to A4 during check period. How
could a charge say substantial extent of property without either



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specifying the extent of properties, are its value?. It is text book case
of vagueness in charge vitiating the trial.
63. The learned Judge failed to see that the on the charge of
abetment there cannot be a lumped up charge of abetment for A2 to
A4. There has to be a separate charge and in respect of each act of
abetment.
64. The learned Judge has brushed aside the submissions on
invalidity of charges by stating that the accused is not prejudiced and
they have led defence evidence. This approach is wrong. As per
Section 464 Cr.P.C the prejudice on account of invalidity in the
charge has no application to trial court thus on this aspect also the
proceedings are invalid.
65. The learned Judge has erred in clubbing the properties of firms
and companies who are not accused in the case. This is directly
contradictory to the decision in Anitha Hada vs God Father Travels
2012 5 SCC 661.
[a] If the court conducting the trial comes to the conclusion that the
company has abetted the accused by acquiring the properties with her
funds and keeping them in their name, then it would amount to its
having committed an offence. According to the above judgment the
company has a reputation of defend. This reputation cannot be



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tarnished without giving the company an opportunity of hearing
particularly in a criminal case.
[b] The procedure will violate fairness and article 300A which says
that all persons are entitled to right to property and they shall not be
deprived of the same except in accordance with law. The properties of
the company therefore cannot be dealt with and ultimately forfeited
without giving them an opportunity to show cause.
[c] The proceedings are also invalid as how could the accused
proved that the company acquired properties with its own funds. It
will amount to causing an impossible burden on the accused to prove
that somebody else acquired the property lawfully.
66. The learned Judge has not met any one of the arguments
advanced before him. The theory that the owners of the property
would be given opportunity in the attachment proceedings under the
Criminal Law Amendment Ordinance is clearly erroneous.
[i] The attachment of property is only optional and therefore, all
the properties might not be dealt with under the Ordinance.
[ii] Under the Ordinance the burden is on the company or the firm
to show it has some interest in the property in a prosecution the
burden will be on the prosecution to prove beyond reasonable doubt
that the property standing in the name of the company actually
belongs only to the accused. Having regard to this serious and



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important distinction between the two proceedings, it is submitted that
the proceedings under the Ordinance will not take away the necessity
of the company being made a party.
67. The learned Judge therefore ought to have excluded the
properties in the name of the companies who have not been made a
party to the proceedings in the prosecution.
68. The learned Judge ought to have held that the registration of the
FIR and filing of the final report are vitiated by malafides. As stated
earlier, the registration of the FIR was under the direction of the
Government final report is also not the independent opinion of PW
259. How could PW 259 refuse to file the final report when the FIR it
was registered at the instance of the Government and by his superior.
69. The learned Judge therefore ought to have set-aside the trial
acquitting the accused on the ground of malafide.
70. The learned Judge has erred in not giving effect to the Ex.D 370
to 373 they are the orders and final report of previous disproportionate
assets case registered against A-1. These documents show that A-1
had as on 30/01/1991 certain extent of property which taken into
consideration would result in addition of Rs.62,42,338.60 which
would have to be added to the Annexure-1 which is the extent of
property held by A-1 before the check period. The reasons given by



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the learned Judge to exclude this amount are arbitrary and
unsustainable.
[i] These documents were sent for from the DV and AC itself.
Hence, plainly admissible.
[ii] The final report has been accepted and the case closed. The
reasoning of the learned Judge whether the final report is what was
closed in the order is not known is unacceptable. Firstly, it is nobodys
case that during the same period there was yet another case for which
a final report came about. Hence, the closure report must refer only to
the final report marked through DW 99. Secondly, this also does not
matter as the period is important this refers only to the period
immediately before the check period in the present case. Thirdly, the
final report is a product of investigation which is accepted in the
judicial order. Fourthly, the decision would operate has issue estoppel.
Therefore, the learned Judge ought to have taken the value of assets
before check period as Rs.2,64,26,295.13 plus Rs. 62,42,338.60
totaling Rs.3,26,68,633.73.
71. Re Agricultural Income:
The learned Judge ought to have accepted the agricultural
income derived by A-1 during the check period in a sum of
Rs.52,50,000/-. His reasons for accepting only Rs. 10,00,000/- as total



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agricultural income deriving by her during the check period is
unacceptable and wrong.
72. The learned Judge failed to see that she had been returning
agricultural income even from 1987-88 in her Income-tax returns and
the same were being accepted, after deep scrutiny as all her
assessments were under section 143[3] of the I T Act.
73. The learned Judge it is submitted has rightly rejected the
prosecution evidence including the report filed by PW 165 and 166 as
totally unreliable.
74. The learned Judge failed to see that the agricultural income
returned by her during check period were accepted after deep
consideration.
75. The learned Judge has failed to see that under exb.D-61
Commissioner of Income-tax [Appeals],in an acutely recent judgment
has accepted the Income from the Agricultural property in a sum of
Rs. 10,50,000/- for that year. The order notes that he had deputed the
Assessing Officer to make a personal inspection and also verify the
price prevailing for varieties of agricultural produce from the land.
The order of CIT[A] shows that the officer had specifically verified
and counted the number of plants by dividing the entire area into
plots. The Officer had also examined neibouring land owner Sri Malla
Reddy and had recorded statements from him u/s 131 of the I T Act.



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The order notes the price from NABARD was obtained. It is only
after deep consideration, physical inspection ascertaining the grape
vines the Officer accepted the agricultural income returned.
76. The learned Judge failed to see that the department obtained the
details from the DV & AC or moved by DV & AC had sought to re-
open the assessment. The assessments were re-opened and but on re-
appraisal of the material including those produced by DV and AC, I T
authorities accepted the agricultural income returned by the A-1. It is
submitted that the same is binding on the trial court.
77. The learned Judge erred in remarking that A-1 ought to have
produced the evidence before the trial court to show that the land had
the potential to yield the agricultural income. This reasoning is wrong
[i] The physical inspection noted in the order Exb.D-61 which is
accepted by the Tribunal itself clearly shows the same. There is no
reason to discard the same particularly when it constituted a basis for
Judicial order.
[ii] The evidence in this regard is given by PW 64 auditor for A-1
who had deposed that he had personally accompanies the Assessing
Officer on his inspection of the grape garden at Hyderabad. His
evidence remains unchallenged. It is settled in law the defence
witnesses are entitled to equal weight and credence as prosecution
evidence.



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78. The learned Judge having accepted that A-1 had agricultural
land of 14! acres calculates on his own basis only for 10 acres. Why
this is not mentioned thus the reasoning of the learned Judge is clearly
arbitrary.
79. The learned Judge ought to have accepted the agricultural
income has returned by A-1 and which have been accepted upto the
Tribunal level has correct and proper. It may be mentioned that A-1 is
required to lead rebuttal evidence after lapse of more than sixteen
years. It would be impossible to lead evidence and what was
cultivated during the check period. That exercise had been done by the
Income-tax authorities.
80. Re Gifts:-
The learned Judge ought to have accepted the gift amount of
Rs.2,15,00,012/- received by A-1 during her 44
th
birthday which is her
first birthday after she led her party to victory at the polls, as the
General Secretary of AIADMK party and became Chief Minister of
the State of Tamil Nadu.
81. The learned Judge has found as a fact that the gifts were all
received by way of Bank Drafts except a small portion in cash. These
have been disclosed to the Income-tax authorities contemporaneously.
There is no reason to discard the same. The reasoning of the learned



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Judge as to why she had not received such gifts in later years is
answered in ground No.73.
82. The learned Judge failed to see that the drafts in which the gifts
were received from the party men itself was taken from unmarked
documents and marked through defense witnesses examined by
accused.
83. The learned Judge has noticed that defends witnesses D-9 to D-
20 and DW 64 and also Exhibits marked in Ex D-21 to 25, D-372 to
373 were acceptable. Even so the gifts have not been accepted. This is
unsustainable.
84. The learned Judge in paragraph 48.16 has stated the receipts of
the presents by themselves may not amount to windfall or immoral
secretions [SIC]that they are received when A-1 was holding the
office as Chief Minister of Tamil Nadu creates serious doubts and
suspicion. It is submitted that on a conjuncture and vague doubts the
resource available to the accused has been negatived.
85. The learned Judge has seriously overlooked the vital material
and his decision qua gifts is therefore stands vitiated
[i] PW 259 has in clear terms admitted in the Cross examination
about the receipt of the gifts by A-1 and how he had examined
seventy five persons who have given the gifts and accepted that the
gifts were genuine. Thus Investigation Officer himself has accepted



27

the gifts has genuine and received. Significantly PW 259 does not say
even a word that the gifts were not legal and not otherwise acceptable
as a resource available to A-1. Thus A-1 was never asked to face a
case of the gifts not being legal.
[ii] The learned Judge has not even adverted to, which is a grave
mistake that in respect of the gifts at the instance of the then DMK
Government who were inimically disposed towards A-1, the matter of
gifts was referred to CBI for prosecution. The CBI registered an FIR
ultimately filed a charge sheet. The CBI filed the charge sheet only in
respect of 19 draft among numerous drafts received as gift. Thus, CBI
did not find anything unlawful in respect of majority of drafts
received as gift. Further, the case instituted by CBI in respect of only
19 drafts was challenged before the High Court, Madras which was
pleased to quash the entire prosecution. The documents in this regard
has been marked in evidence. It is also a reported judgment which
report had also been submitted to the court. Thus on account of these
factors the gifts ought to have been accepted.
86. The learned Judge failed to see the above case law had also
been quoted in the written submissions filed. The A-1 submits that the
learned Judge has chosen to over look a significant document filed on
behalf of A-1 has apparently he had considered it to be inconvenient.
Hence, the gift pleaded in the form of Rs. 2,15,00,012/-.



28

87. Re Subscription Scheme Deposit of NAMADU MGR
amount to Rs.14,10,35,000/-:-
The learned Judge has disallowed the entire amount towards the
scheme and it is submitted must be termed as on convoluted
reasoning.
[i] While considering the income or resource pleaded by the
accused the learned Judge has failed to keep in mind the requirement
that it has to be proved only by probabilities as in a Civil Case and not
by proof beyond reasonable doubt.
[ii] In this regard, the learned Judge has not given any reason why
the decision of the Tribunal under the I T Act is not accepted by the
trial court. The Income-tax Department in scrutiny assessments had
fiercely contested the claim of deposit as the deposit being returnable
deposit could not be taxable as an income. For all the five years,
comprising the check period the Income-tax Appellate Tribunal has
accepted the receipt of deposits. It is submitted the trial court is bound
by the same.
[iii] The learned Judge also failed to see in the light of the evidence
of the decisions of the Income-tax authorities under scrutiny
assessments, the burden on the accused, if any, is very light in deed.
These parameters in judging the income is severely ignored by the
learned Judge. The learned Judge has noticed 31 defence witnesses



29

have been examined who have through whom the deposit receipts
were marked and oral evidence given for having made the deposits.
There is no reason at all why these evidences are not accepted. The
only reason given in para 50.23 is they are interested and partisan
witnesses.
[iv] This criticism is unacceptable as the News paper is Namadu
MGR and it is in effect mouth piece of the AIADMK party and
therefore, the party men subscribing to the same cannot be considered
interested. They have also deposed why they are subscribed and what
they do with a free copies received. The learned Judge therefore, is in
serious error in rejecting the oral evidence on such flimsy ground.
88. The learned Judge has made a long para in 50.21 and
considered Ex. D-230 series which are nearly 7000 applications
received from the scheme deposit holders. The theory of the learned
Judge they must have been prepared sometime in 2012 and that
appearance of old used papers and that the papers must have been
kept in the sunlight and expose to smoke to give them appearance of
old used papers. It is unfortunate that such serious observations have
been made without any basis. The learned Judge has forgotten that no
question has been asked in the cross examination to DW 88
suggesting the above theory. Without such suggestions being made
the learned Judge cannot launch into a theory that the documents were
created for the purpose of this case.



30

89. The learned Judge further erred in thinking that PW 201, the
Bank Manager had not stated that the cash deposits were subscription
money of NAMADU MGR. He only has the bank deposit and bank
deposit will show as cash. It is only the Auditor connected with
NAMADU MGR will know the nature of the deposit.
90. The learned Judge in paragraph 50.12 has remarked as under:-
What is significant to be noted is that, no where in his evidence PW
201 has stated that a sum of Rs. 14,10,35,000/- collected by way of
the deposit under the alleged scheme by A-1 and A-2 have been
credited to the bank account of Jaya Publications.
It is not known for what basis or on what reasoning this averment has
been made. A Bank Manager cannot know the nature of the cash
deposit by the account holder. He need not also know it.
91. The learned Judge has noticed in paragraph 49.2, that the
scheme deposit was in existence even earlier to the check period and
deducting the initial deposit earlier to the check period the amount of
Rs. 14.10 crores has been arrived at.
92. The learned Judge has also committed serious error and failed
to understand the accounting practice. The learned Judge in paragraph
50.2 has stated that the scheme deposit receipt has not been reflected
in the return filed by the Jaya Publication, the assessee. He had relied
upon the Ex.D-221 to 223 in this regard.



31

[i] The deposits under the scheme are returnable deposit therefore
they will not be and cannot be shown as an income. Therefore, the
above returns do not show deposit receipts on the income side of the
profit and loss account. These documents show they were shown on
the side of liabilities as they are returnable deposits. Serious
arguments addressed in this regard has been forgotten by the learned
Judge.
[ii] The learned Judge is also wrong in noting that these returns and
profit and loss account statements are attested as True Copy by Sri
Vydianathan, Chartered Accountant. It has been marked without
objection. They cannot now be disputed. The decision had also be
cited. It is not even referred. Sri Vydianathan is the partner of M/s.
Venkataraman and Co., who are the Chartered Accountants of the
firm.
[iii] The learned Judge further over looked the assessment orders
upheld by the Income-tax Appellate Tribunal for all the five years of
the check period have also been marked in this case. They are based
on the same profit and loss account and return in the above exhibit.
This itself assures their admissibility. Hence, the scheme deposit
resources pleaded on behalf of the accused ought to have been
accepted.




32


93. Re Agricultural Income of M/s. Jaya Publications:-
The learned Judge ought to have accepted the agricultural
income for all the five years received by M/s. Jaya Publications for
the leased hold lands ought to be accepted.
94. The firm M/s. Jaya Publications has also been carrying on
agricultural operations under the name Sapthagiri Farms.
[i] In the Income-tax returns, the assessment orders of which were
accepted by the Income-tax authorities upto the Income-tax Appellate
Tribunal level the agricultural income has been disclosed and
accepted, all the assessments being scrutiny assessments u/s 143[3] of
the I T Act.
[ii] As the burden on the accused is only as that of a Civil Case, the
Income-tax assessment orders that to determination by the Judicial
Form is conclusive and binding on the trial court.
[iii] In the assessment orders there is a reference to detailed
accounts have been maintained and how on perusal of the same. The
Income has been determined. After 17 long years, when the accused is
called upon to lead defense evidence she cannot lead evidence as to
the agricultural produce 17 years back. The contemporaneous Income-



33

tax proceedings accepting the agricultural income requires to be
accepted.
[iv] The learned Judge is in error in thinking a partnership firm
cannot carry on agricultural operations if there is no specific provision
in the Partnership deed in this regard. A partnership Firm unlike a
company can carry on any business if the partners agree to do the
same.
95. Re-Sales and Job Work Income of M/s. Jaya Publications:-
The learned Judge ought to have accepted the total income
during the check period under the above heading in a sum of
Rs.4,19,96,605.60. All these Income received have been disclosed to
the Income-tax authorities and assessment orders made and upheld by
the Income-tax Appellate Tribunal.
96. Disallowance of the above amount by the learned Judge is
liable to be set-aside for the following reasons:-
[i] The Income under the above heading received by Jaya
Publications has been duly disclosed in the successive years. The
profit and loss account in Ex.D-219 to 221 and Ex.D-224 to 226
established the same. For the assessment years 1991-92, 1992-93
profit and loss account statement is Ex.D-218 and 219. The
assessment orders were made accepting the accounts as aforesaid.



34

Hence, it is binding on the trial court being findings of the Judicial
Form.
[ii] The Xerox copies marked, having been signed as True Copies
by Sri Vydhyanathan, Partner of M/s. Venkataraman and Co., who are
the auditors of M/s. Jaya Publications makes it admissible.
[iii] The documents have been marked without objection and
therefore, it cannot be questioned at a later stage.
[iv] The profit and loss account statement are not reflected in the
return and lesser figure is shown as Income and therefore, the profit
and loss account exhibited above are unreliable documents. Whole
reasoning shows that the arguments addressed explaining the accounts
were forgotten by the trial court. It also shows lack of accounting
knowledge and perusal of documents filed in this case.
[v] In paragraph 49.2, the tabular coloumn filed by the accused is
shown. This document shows that as per Ex.D 219, the total income
from business is shown as Rs.16,89,680/-. However, this document
has not been kept in view. Whereas in paragraph 52 the trial court
says the income returned for the assessment year 1992-93 is
Rs.2,09,885/-. Thus the paragraph 52 of the judgment factually error.
It is unfortunate that the learned Judge has overlooked written
submission. It is more unfortunate that it has costed the accused their
liberty.



35

[vi] The Income of M/s. Jaya Publications which includes the above
figure has been accepted by the Income-tax department upto the
Appellate Tribunal level, it is binding on the court and this factor is
not even mentioned while the trial court rejects the income. It is
submitted this amounts to omitting to consider a significant evidence
nay that which binds the trial court.
97. Re Rental Income and Interest Income of M/s Jaya
Publications:-
The amount of Rs.45,30,642/- is claimed as a rental income of
M/s. Jaya Publications. Further, Rs.6 lakhs had been received in the
year 1995 and 1996 towards the Hire Charges of the Machinery. The
Interest Income accrued to the firm has also been disallowed.
[i] The learned Judge has rejected the income under the above
head on the basis that the profit and loss account statement of M/s
Jaya Publications are unreliable. It has been stated above, how the
profit and loss account are true and duly considered by the Income-tax
authorities and accepted by them upto the Appellate Tribunal level.
[ii] The above income pleaded by the accused ought to have been
accepted only on the basis of the acceptance by the Income-tax
authorities.
98. Re M/s. Sasi Enterprises and Income therefrom:-



36

The accused have earned the total income of Rs.95,92,776/-.
Every one of the income has been supported by the Income-tax
returns, profit and loss accounts and assessment orders/orders in
appeal which are all in favour of the accused. Therefore, the learned
Judge ought to have accepted the same.
99. The learned Judge has made a serious error in disallowing the
refund of Rs.16,91,000/- from Nagammal and Subramanian. The
return of the money in each year has been shown in the profit and loss
account and on the basis of which the assessment made and accepted
the Income-tax authorities. It is not proper for the trial court assume
that the Income-tax authorities have over looked the section 269SS of
the IT Act and made the assessment order.
100. The learned Judge has filed to see that Section 269SS of the IT
Act applies only to a loan or deposit. This amount is neither a loan or
deposit. This was the amount given to both the persons for purchase
of property and since the transaction did not happened the advance
was returned. For this section 269 SS has no application.
101. The learned Judge has failed to see that when prosecution has
not suggested to DW-88 that this amount is contrary to Section 269
SS of the I T Act the learned Judge on his own accord bringing
Section 269SS of the Act to disallow the amount has being illegal
receipt. If suggestion had been made during the cross examination



37

DW-88 would have had the opportunity to explain it. Hence, the
above receipt of Rs.16,91,000/- is clearly acceptable.
102. The learned Judge has failed to see the receipt of the
agricultural income by M/s. Sasi Enterprises has also been accepted
upto the Commissioner of Income-tax[Appeals]. The reasons given by
the trial court in disallowing the same is unjustified.
[i] The theory that there cannot be lease of agricultural land for 11
months is improper statement of law. Only lease of agricultural land
exceeding 11 months requires registration. It is lease only for 11
months and therefore, it is admissible and no registration is necessary.
[ii] The learned Judge has negatived the receipt of the agricultural
income only on the above fact and therefore, the judgment on this
point is clearly wrong.
[iii] The learned Judge seeking to discard the certificate of
Thasildhar Ex.D-259. There was no cross examination on the validity
of the document. Hence, it is not open to the trial court to assail it.
[iv] In paragraph 59.12, the trial court says that he is not accepting
Income-tax returns and orders thereon as the agricultural lease is not
proved. It is not correct for the above said reasons. The decisions of
the Income-tax authorities are binding on the trial court. This is
necessary to point out the serious arguments addressed and the



38

decisions cited how the orders of Income-tax authorities are binding
on the trial court has not even been adverted in the judgment.
103. Re House Hold Expenditure of the A-1:-
The prosecution has included in Annexure -4 in item 225 House
Hold expenditure of Rs.16,15,500/-. The learned Judge has accepted
the entire amount without discussion if there is an evidence for each
items of the expenditure. The decision of the trial court is vitiated on
account of the same. For example
[i] Salary for six drivers at Rs.1,500/- per month for 59 months is
Rs.5,31,000/-. Except the oral evidence of PW 198 there is no
evidence. Not even name of the six drivers is given by PW 198. The
so called drivers ought to have been examined to show if they worked
in the house hold of A-1 during the relevant time.
[ii] Salary for Electrician of Rs. 88,500/-. Here also no voucher is
produced Electrician not examined not even his name given. This is in
respect of every other expenditure.
104. The learned Judge has overlooked that the prosecution must
prove the expenditure beyond reasonable doubt. The evidence of
prosecution in this regard far short of the requirement of degree proof.
105. The learned Judge failed to see that A-1 had disclosed her
house hold expenditure in her Income-tax returns for all the years. But



39

the trial court omits to take that into consideration on the basis that
such expenditure is not supported to the documentary evidence. It is
submitted this is perverse. The expenditure has been accepted by the
Income-tax Department under scrutiny assessments. Nobody will
admit an expenditure that is against her interest. If the logic of the trial
court is correct, then her house hold expenditure declared under
Income-tax proceedings must be added to her income. What the trial
court has done amounts to taking double expenditure under the head
House Hold expenditure.
106. Re Marriage expenditure:-
The learned Judge in paragraph 67.8 has stated that the
evidence PW 181 regarding the cost of construction of PANDHAL is
mere estimation based on the information furnished to him by other
prosecution witnesses. This statement has two aspects.
[i] The learned Judge himself in paragraph 67.7 has stated rightly
that he agrees with the submission of the counsel for A-1 that PW
181 was neither an eye witness to marriage arrangement made at the
avenue or personal knowledge of the expenditure. If so the entire
evidence is liable to be rejected as hearsay.
[ii] PW 181 claimed estimated the cost of Pandhal that he obtained
the details from six named persons. None of them are examined by the
prosecution. Two of them namely Thottadharini and another have



40

been examined as defence witnesses. To them no question has been
put in the cross examination that he ever gave any information to PW
181.
[iii] The learned Judge has not discussed the cross examination of
PW 181 and the significant answers given in the cross examination.
[iv] There is no process of reasoning by which evidence of
PW 181 can be seen in the light of the expenditure pleaded by other
prosecution witnesses. Each prosecution witnesses when he speaks
about an expenditure it must be judged on its own accord. Thus the
entire expenditure relating to the marriage must be excluded.
[v] The learned Judge erred in relying upon the deposition of
PW 228 this witness requires to be excluded as he was not brought up
for cross examination despite the order permitting his cross
examination the reasons for accepting his evidence is therefore clearly
unsustainable.
[vi] The learned Judge has overlooked that many expenditure
like payment of telephone bills, electricity bills, Adayar Gate Hotel
are mere photocopies objected to at the time of marking. Since no
original has been produced they are inadmissible in evidence.
[vii] Relating to the cost of Mineral Water, Thamboolam etc., mere
oral evidence cannot be accepted as it would not amount to prove
beyond reasonable doubt.



41

107. The learned Judge failed to see that stitching charges was
paid by uncle of the bride. PW 196 himself speaks about the same. He
was not treated hostile. He received it by cheque it is reflected in the
Bank statement of DW 1 still in utter perversity. The learned Judge
says this expenditure must be included as incurred by A-1.
108. In the marriage expenditure, the decision of the trial court
is arbitrary and is based on no evidence.
[i] As stated earlier, PW 181 evidence has to be discarded for the
reasons stated above. Hence, the entire expenditure towards
PANDHAL, Chairs etc. which will exclude Rs. 5.40 crores.
[ii] The other expenditure towards silver etc are not incurred by A-
1. The expenditure towards silver is accepted by Mr. Bhaskaran,
eleder brother of A-3. Even the prosecution has contended that the
expenditure incurred by A-2 and not A-1.
[iii] DW -1 had shown how the marriage expenditure was incurred
by them and for that they had opened an account in State Bank of
India, Gopalapuram Branch, Chennai. This original pass book has
been marked as D-15. The learned Judge casts unwanted aspersion on
this document.
109. The marriage expenditure was subject matter of
proceedings before the Income-tax authorities examined the several
persons who met the expenditure and in Income-tax proceedings



42

ultimately except to the extent which A-1 admitted the expenditure all
other expenditures were deleted. This has also been upheld by the
Income-tax Appellate Tribunal. The learned Judge does not even
referred or considered the document.
110. The learned Judge had arbitrarily fixed the expenditure
incurred by A-1 for marriage of A-3 at Rs. 3 crores. The learned
Judge is not entitled to makes such adhoc expenditure that too to the
tune of Rs. 3 crores without any materials which will cross the
required degree of proof. Thus, allowing an expenditure of Rs.
8,49,06,833/- towards item 146 and 228 is clearly wrong and entire
thing must be excluded.
111. Re Two Constructions and one renovation made by
A-1 during the check period :-
The learned Judge has not independently considered the
defence evidence in this regard. Hence, whole judgment is vitiated.
On behalf of A-1, the following substantial evidence has been let in
regarding construction.
[i] A-1 has incurred the expenditure all by cheque this
contemporaneous document shows the expenditure as also the
vouchers, bill and other supporting documents.
[ii] The Income-tax department made in depth enquiry in this
regard. The Assessing Officer was sent to Mumbai and to record the



43

statement from the suppliers of Marbles and Granites. Such enquiry
was done and statement recorded, vouchers, transport bills collected
by the Income-tax Department. These have been sent for and marked
in defence DW 64 has spoken about the same in detail in his evidence.
The expenditure has returned by A-1 has been accepted by the
department and this has been upheld by the Appellate Tribunal. There
is not even a reference in the judgment about these documents.
[iii] The learned Judge has lumped all the constructions without
analyzing the prosecution evidence in respect of each constructions
and if the same is acceptable. If it is not acceptable, then no burden
will be thrown upon the accused to prove the extent of expenditure if
any.
[iv] The evidence of PWD evaluators is unacceptable highly
discrepant and based on no verifiable data. They cannot be considered
as expert nor it will satisfy the test for accepting expert evidence.
[v] The learned Judge has noted that for all the constructions
allegedly made in this case, the prosecution wants to add huge amount
but the learned Judge in paragraph 78.35 has stated
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 being some dispute regarding the
payments of the architects fees, in order to meet the ends of Justice, it



44

would be proper to reduce the overall cost of constructions by 20% of
the total estimation given by the prosecution witnesses. This shows
the arbitrary nature in which the trial court has made the judgment.
[vi] In law if prosecution evidence is not acceptable then it must be
discarded and no burden will shift to the accused.
[vii] In law, accused is called upon to meet a case of the prosecution.
The Court cannot invent a third case which is not the case of the
prosecution or that of the accused.
[viii] The learned Judge has not considered prosecution evidence in
respect of each of the constructions itself vitiates the entire trial as
under the judgment, the learned Judge wants to add Rs. 22,53,92,344/-
as expenditure towards construction.
112. Re Gold Jewellery:-
The laboured reasons given by the learned Judge as regards
gold jewellery requires only to be seen to discard them as totally
wrong. The learned Judge has made a new case which is not even the
case of the prosecution of the defence which the trial court is not
entitled to do.
[i] The learned Judge failed to see that each one of her
assessments made upto 1991-92 had shown the extent of gold
jewellery and diamonds possessed by her. It comes to about 21.250



45

kilo grms. The observations of the learned Judge that she was in
possession only 7040 grams of gold jewellery is based on no material
but overlooking the materials on record. Therefore, no amount is
liable to be added towards the expenditure relating to the Gold.
[ii] In this regard, the learned Judge propose to make a
calculation on the valuation given under the Wealth-tax Act. The
such valuation cannot be adopted for two reasons
[a] Many of the gold jewellery were diamond studded the
valuation of the diamonds has to be made there is no evidence in this
regard.PW 125 admits that he has not valued the diamonds. Secondly,
valuation of the gold depend upon the year of the acquisition. It varies
year after year. When there is no evidence, on which year the
jewellery was acquired it cannot be valued.
[iii] The jewellery declared by A-2 before check period for
which also there is assessment order and return has not been seen or
taken into consideration. Thus the conclusion in the judgment that A-1
has acquired the gold and diamond jewellery worth of Rs.
2,51,59,144/- is based on no evidence and the learned Judge had made
out a third case. This itself vitiates the order.
[iv] The learned Judge failed to see that the prosecution
evidence of PW 125, 155 and 179 are all liable to be rejected as
totally unreliable and without any corroboration.



46

113. Re Silver:-
The learned Judge failed to see that in the assessment before
the check period in Ex.P 2318, it is seen that she had 116 kg silver
valued at Rs. 48,80,000/-. The total quantity allegedly recovered is
1200 kgs. Hence, there can be no addition under the head of Silver.
114. Further, no silver allegedly seized was produced or
exhibited in this case. Nor they are in possession of the court. Yet the
learned Judge has added Rs. 20,80,000/- under the head Silver
which is totally unjustified and wrong.
115. As regards to watches, the evidence of Pw.129 & Pw.130
on a plain reading of the evidence will show that they cannot be
considered as expensive. The series of judgment have shown who can
be an expert. These judgments are not even adverted to. The learned
Judge failed to see that these witnesses have also been recalled for
further examination wherein they have disowned their previous
statement. The finding that watches with a particular value must be
added to the expenditure of A-1 is clearly erroneous and wrong.
116. The entire judgment is vitiated on account of one
fundamental error. The learned Judge has lumped up together all the
properties standing in the name of A-1, other accused and Companies
which companies are not parties to this case. This is fundamentally
wrong because the nature of evidence required to show the properties



47

standing in the name of A-2 to A-4 and the properties standing in the
name of the Companies on one hand and the properties standing in the
name of A-1 and the expenditure made by her in the construction on
the other hand are entirely different. This distinction has not been kept
in view by the trial court.
117. The learned Judge failed to see unless the prosecution
establishes the benami character of the property held by A-2 to A-4
they have to be outside the Jurisdiction of this case.
118. The learned Judge mentions about what is requirement
for proof of benami character but has not given any finding nor
applied the law to the facts of this case. This significant and grave
error has vitiated the entire judgment.
119. The learned Judge after accepting that the burden rest
solely on the prosecution to establish the ingredients of the Sec.
13[1][e] of the Act has failed to analyze in respect of each item of the
property and each item of the expenditure, if prosecution has proved
the same beyond the reasonable doubt.
120. As can be seen from paragraph 89.9 the learned Judge
seems to think that the above principle is applicable only while
considering the property in the names of six companies.
121. The learned Judge failed to see the issue is not whether
A-3 and A-4 were Directors of the Companies at some point of time.



48

Issue is whether if A-1 had anything to do with the companies. It is
not even the case of the prosecution that the A-1 was ever a
shareholder or Director in the Company. She was not. Thus, what
others do has no relevance to A-1 and hence the companies must be
excluded from the case.
122. The learned Judge failed to see that the companies had
generated the funds of their own by borrowing from the Banks or by
way of Inter corporate deposits. These have been by cheque and are
bank transactions.
123. The learned Judge failed to see that 5 out of 6 companies
have filed the Income-tax returns and the Income and Expenditure and
Balance Sheets have been marked. The Companies have also
assessed to Income-tax. The scrutiny assessments have been accepted
and Income assessed. There is no reasons to discard this evidence.
The learned Judge does not even discuss this.
124. The learned Judge failed to see that merely because A-3
had signed certain letters requesting loan from Indian Bank, the
property purchased by the company in its own name could become the
property of A-3 or A-1.
125. The entire reasoning of the learned Judge as regards the
companies are vitiated by the above said fundamental defects.



49

126. The learned Judge has also remarked the prosecution has
produced direct evident to show the properties in the name of the
company were purchased out of funds emanating from the accused.
This is no finding in the eye of law as regards Section 13[1][e] of the
Act. The learned Judge does not say that the funds have emanated
from A-1. There is no prosecution evidence in this regard. Thus, all
the properties standing in the name of the Company are liable to be
excluded.
127. The learned Judge failed to see that there is no material at
all to prove conspiracy between the accused. A-2, A-3 and A-4 are all
having independent income and also borrowed from Banks and Public
Institutions.
128. The learned Judge failed to see that there is no material
nor even a finding in the judgment A2 to A4 are benamidhar of A-1.
The Companies are separate juristic entities and the properties
purchased by them cannot be that of A-1 particularly when A-1 was
never a shareholder or director of the Company.
129. The learned Judge failed to see that degree of proof
requires in the Criminal case is higher than in attachment proceedings
and therefore, the attachment proceedings under the Criminal Law
Amendment Ordinance cannot be used against the accused as has
been done by the learned Judge.



50

130. The learned Judge has failed to see that the very framing
of charge itself is defective and the learned judge has failed to remedy
it despite the order of High Court.
131. The learned judge though adjourned the pronouncement
on the question of sentence, pronounced the same only around 4.30
pm. Hence the Appellant is constrained to move this appeal in a
hurry and crave leave of this Honble court to raise some additional
grounds later.
132. The learned Judge while passing the sentence had
imposed a fine of Rs.100 crores, it is extra ordinary, unprecedented,
totally arbitrary exercise of power. The learned Judge could not have
passed an order of fine which is two times the disproportionate of
asset according to the judgment. This shows that the learned Judge
was not objective but appear to have entertained undue animosity
against the accused.
133. The learned Judge erred in specifying the mode of
payment of the huge amount of Rs. 100 crores, there may not be a
power to pass such orders for payment of fine. This is more so, when
most of the fixed deposits and cash balances are in the names of other
accused than A-1. Whereas the liability to pay the fine is cast only on
A-1.



51

134. The learned Judge further failed to see with the direction that if
the above adjustment falls short of the fine amount then gold
jewellery shall be sold except 7040 gms. There is nothing in the
judgment to identify the 7040 gms as most of the jewellery are
studded with diamonds or artificial stones. The value of such
diamonds are artificial stones are not calculated.
135. The learned Judge has further no power to direct that 5 crores
out of the fine amount shall go to the Government of Karnataka
towards the cost of trial conducted in the State of Karnataka. This is
also wrong and without authority of law. The cost of prosecuting the
person can never be recovered from the accused. Further, Honble
Supreme Court of India in the order of transfer has already provided
what should be paid by the State of Tamil Nadu. The order flies in the
face of the order passed by the Honble Supreme Court of India.
136. The learned Judge, though has heard the Appellant as
well as her counsel on question of sentence, has failed to consider the
same and not a whisper is made about it in his judgment which
amounts to violation of the right of the Appellant mandated u/s.
235(2) of Cr.P.C.
137. The Appellant seeks leave of this Honble Court to raise,
plead and urge any other grounds available to him during the course
of hearing.



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PRAYER
Wherefore, it is prayed that this Honble Court be pleased to set
aside the judgment and order of Conviction and sentence both dated
27.09.2014 and passed in Spl C.C. No. 204/2004 by the learned Spl.
Judge, XXXVI Addl. City Civil and Session Judge, Bangalore, for the
offences punishable under Section 13(1) (e) read with 13(2) of the
Prevention of Corruption Act, 1988 and Sec 109 read with 120(B) of
I.P.C., by allowing this Appeal, in the interest of justice and equity.


Bangalore,
29.09.2014 Advocate for the Appellant


















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