- 1 - NC: 2025:KHC-D:1178 CRL.A No. 100335 of 2016 IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 22ND DAY OF JANUARY, 2025 BEFORE THE HON'BLE MR. JUSTICE HEMANT CHANDANGOUDAR CRIMINAL APPEAL NO. 100335 OF 2016 (A) BETWEEN: THE STATE OF KARNATAKA REPRESENTED BY SPECIAL PUBLIC PROSECUTOR, KARNATAKA LOKAYUKTA POLICE, HIGH COURT OF KARNATAKA, BENCH AT DHARWAD, DHARWAD, (LOKAYUKTA POLICE BELAGAVI) …APPELLANT (BY SRI. G.I. GACHCHINAMATH, STATE PUBLIC PROSECUTOR) AND: JANAYAND S/O. BALAGOUDA NARASANNAVAR, AGED ABOUT 51 YEARS, OCC: MOTOR VEHICLES INSPECTOR, OFFICE OF THE RTO, NAVANAGAR, HUBBALLI, R/O: HANUMAN NAGAR, BELAGAVI. …RESPONDENT (BY SRI. SHANKAR HEGDE, ADVOCATE) THIS CRIMINAL APPEAL IS FILED UNDER SECTION 378 (1)&(3) OF CR.P.C., PRAYING TO GRANT LEAVE TO APPEAL AGAINST THE JUDGMENT AND ORDER OF ACQUITTAL PASSED BY THE IV ADDITIONAL DISTRICT AND SESSIONS AND SPECIAL JUDGE(PCA), AT BELGAUM DATED 13.1.2016 IN SPECIAL CRIMINAL CASE NO. 55 OF 2013 AND SET ASIDE THE JUDGMENT AND ORDER OF ACQUITTAL PASSED BY THE IV ADDITIONAL DISTRICT AND SESSIONS AND SPECIAL JUDGE(PCA), BELAGAVI DATED 13.1.2016 IN SPECIAL CRIMINAL CASE NO. 55 OF 2013 AND CONVICT AND SENTENCE THE RESPONDENT/ACCUSED PERSON FOR THE OFFENCES PUNISHABLE UNDER SECTION 13(1)(e) READ B K MAHENDRAKUMAR Digitally signed by B K MAHENDRAKUMAR Location: HIGH COURT OF KARNATAKA DHARWAD BENCH Date: 2025.01.29 15:27:10 +0530 - 2 - NC: 2025:KHC-D:1178 CRL.A No. 100335 of 2016 WITH SECTION 13(2) OF PREVENTION OF CORRUPTIION ACT, 1988. THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY, JUDGEMENT WAS DELIVERED THEREIN AS UNDER: CORAM: THE HON'BLE MR. JUSTICE HEMANT CHANDANGOUDAR ORAL JUDGMENT 1. This appeal is filed by the Lokayukta Police challenging the judgment of acquittal, whereby the respondent- accused has been acquitted of offences punishable under Section 13(1)(e) read with Section 13(2) of the Prevention of Corruption Act, 1988. 2. The case of the prosecution is that the accused, appointed as a Motor Vehicle Inspector, served in the office of the Commissioner, Transport Officer, Bengaluru, from 31.05.1993 to 24.06.1998, and subsequently worked at various RTO offices in Bengaluru, Belagavi, Bagalkot, Gadag, Dharwad, and Chikkodi. While serving at Navanagar-Hubli in the office of the RTO, Hubli- Dharwad, a raid was conducted on 02.12.2009 at his residence bearing CTS No. 3728, Plot No. 731, Hindalga Road, Hanuman Nagar, Belagavi, and another house bearing No. 227 in Gudas Village, Taluka Hukkeri. 3. During the raid, it was discovered that the accused and his family members possessed assets worth ₹87,49,988/- and incurred expenses amounting to ₹24,28,069/- for themselves and their family members, while their known source of income was - 3 - NC: 2025:KHC-D:1178 CRL.A No. 100335 of 2016 ₹56,49,465/-. After calculations, it was determined that the accused and his family members were holding assets and resources worth ₹55,28,592/-, which was disproportionate to his known source of income, calculated to be 97.86%. 4. To prove its case, the prosecution examined 11 witnesses (P.Ws. 1 to 11) and exhibited documents marked as Exs. P.1 to P.83. The accused, in his defense, examined himself and two other witnesses (D.Ws. 1 to 3) and marked documents as Exs. D.1 to D.16. 5. The trial Court, after evaluating the evidence and hearing the arguments of both parties, framed points for determination and held as follows: “The prosecution has failed to establish that the accused possessed assets disproportionate to his known source of income.” 6. The learned counsel for the appellant argued that the trial Court, without proper justification, disbelieved the valuation report submitted by P.W.6, which stated that the value of the RCC building bearing CTS No. 3728 was ₹53,00,000/-, instead erroneously determining the value at ₹32,28,000/-. It was further submitted that the valuation of household articles and the accused’s and his wife’s additional sources of income was speculative. Therefore, the impugned judgment of acquittal is legally unsustainable. - 4 - NC: 2025:KHC-D:1178 CRL.A No. 100335 of 2016 7. In response, the learned counsel for the respondent- accused argued that P.W.7 conducted the inspection of the property without issuing notice to the respondent/accused and was not a competent officer to assess the value of the building. It was further submitted that the respondent/accused had declared his agricultural income in his annual property records since his appointment and had filed income tax returns for himself and his wife four years prior to the raid. Thus, the trial Court rightly considered these aspects and passed the impugned judgment of acquittal, which does not warrant interference. 8. It was also contended that the investigation conducted by the Police Inspector was without prior authorization as required under the second proviso to Section 17 of the Prevention of Corruption Act, 1988. Consequently, the investigation, culminating in the filing of the charge sheet, stands vitiated. 9. After carefully considering the arguments advanced by both parties and thoroughly reviewing the trial Court’s records, the only point that arises for consideration is: “Whether the prosecution has established the guilt of the accused beyond all reasonable doubt, and whether the impugned judgment of acquittal passed by the trial Court is legally sustainable.” - 5 - NC: 2025:KHC-D:1178 CRL.A No. 100335 of 2016 10. Schedule-A properties during the check period standing in the name of the accused are as follows: Sl. No. Particulars As per the I.O. As per Court 1 CTS No. 3728 plot No.731 at Scheme No.40 situated near Ganesh Temple Hindalga Hanuman nagar Belagavi. 4,19.378 4,19,378 1A RCC building over the site bearing CTS No. 3728 plot No.731 at scheme No.40 situated near Ganesh Temple Hindalga Hanuman nagar Belagavi measuring 4000 sq.ft 53,00,000 32,28,000 2 Site bearing No.266 & 267 measuring 60x38 ft and site No.264/A measuring 36x38ft of Gidadakonenhalli village Yashwantpur Hobli Bengaluru north 2,13,000 2,13,000 3 Plot No.63 measuring 2550 sq.ft and plot No.43 measuring 2500 sq.ft situated at Dhupadal village in Gokak taluka 72,000 72,000 4 Land bearing Sy. No.315/2 measuring 2 acres 21 guntas of Bellad Bagewadi village 2,50,000 2,50,000 5 Land bearing Sy. No.46 measuring 20 guntas of Gundas village Tq. Hukkeri 60,000 60,000 6 Plot No.20 measuring 2 guntas 1.5 annas situated at Sutagatti village which is under the jurisdiction of CMC Hubli Dharwad. 1,62,450 1,62,450 7 Site bearing No. 143/2 and 144/2 measuring 12x80 meters out of Sy. No.678(P) situated at Kanbargi village under the limits of Karnataka Housing Board 2,91,678 2,91,678 - 6 - NC: 2025:KHC-D:1178 CRL.A No. 100335 of 2016 8 Land bearing Sy. No. 514 measuring 5 acres 26 guntas of Gundas village Tq: Hukkeri --- --- 9 Land bearing Sy. No. 414 measuring 1 acre 13 guntas 6 annas situated at Gudas village --- --- 10 Land bearing Sy. No. 207 measuring 11 acres situated at Gudas village --- --- 11 MOVABLE PROPERTIES OF ACCUSED: 11A Household articles 3,27,165 2,00,000 11(B) Furniture and fixtures 1,42,505 1,00,000 11(C) Electric and Electronic Equipments 2,40,322 1,60,972 11(D) Golden ornaments 5,04,845 --- 11(E) Silver articles 64,645 --- 11(F) Net cash 14,139 14,139 12 PURCHASE OF VEHICLES 12(1) Honda Activa Motor cycle bearing No.KA-25/R-9495 31,000 31,000 12(2) Bicycles 12,000 12,000 12(3) Centro Hondai vehicle bearing No.KA-29/MB-5234 --- --- 12(4) Hero Honda Splendor Plus Motor cycle No.KA-23/W9369 --- --- 12(5) Hero Honda Splendor Motor cycle No.KA-23/L-564 --- --- 12(6) Maruti 800 Car No.KA-23/M-5234 --- --- 13 Details of savings, RD & deposit accounts in various banks 6,41,601 6,41,601 14 Details of deposit made for electricity connection 1,860 1,860 - 7 - NC: 2025:KHC-D:1178 CRL.A No. 100335 of 2016 15 Details of deposit made for getting HP Gas connection from Tejashwini Enterprises 1,400 1,400 TOTAL 87,49,988 58,59,478 11. The trial Court more or less has concurred with valuation arrived by the investigating Officer, except for the property at Sl.No.1(A), 11(A) and 11(D). Insofar as the property at Sl.No.1(A), the Investigating Officer has valued the property at Rs.53,00,000/- and based on the report submitted by P.W.7 at Ex.P.58. However, the report submitted by P.W.7 is without issuing notice to neither the accused nor his wife and there is no substantial evidence as to how he valued the property at Sl.No.1(A) is arrived. 12. Chapter 13(2) of the Public Works and Irrigation Department Code states that in the case of valuation of acquisition, Assistant Executive Engineer shall after personal inspection obtained sanction plan elevate, prepare valuation statement and submit to the Executive Engineer and in turn, the Executive Engineer and he should be countersigned by the Executive Engineer. 13. In the instance case, the inspection was conducted by the P.W.7 who is Assistant Engineer and the Assistant Executive Engineer and it was not counter signed by the Executive Engineer. Therefore, the report submitted by the P.W.7 lacks competency and was in violation of chapter 13 of the Code. - 8 - NC: 2025:KHC-D:1178 CRL.A No. 100335 of 2016 14. The trial Court in addition to the oral evidence of DW.3 i.e. the accused herein, has also considered at Ex.D.16 i.e. valuation report submitted by Government approved valuer, has come to the conclusion that the value of the property at Sl.1(A) is not more than Rs.32,28,000/-. 15. The trial Court has also observed that P.W.6 has presumed that all the materials are purchased in the open market and labourer hired at government rate and P.W.7 has not taken into consideration that the contractors profit of 10%, 10% over head charges, 1% watchman charges , 2% on curing, 7.5% water and sanitary connection, 7.5% electricity and other connections and 5.5% on Vat charges. Therefore the valuation of the property at Sl.No.1(A) was in excess of the actual value and the trial Court taking into aforesaid circumstances, has rightly valued the property at Rs.32,28,000/- . I 16. Insofar it relates to household articles at Sl.No.11(A), the prosecution has valued it Rs.3,27,165/-. However, the Investigating Officer has not produced the calculation memo of the household articles, as to how he has value the house hold articles at Rs.3,27,165/- and in the absence of calculation memo, the trial Court has rightly valued the house hold articles at Sl.No.11(A) at Rs.2,00,000/-. Moreover the trial Court has also observed that the panchas who seized the house hold articles are not expert in valuing the said articles. 17. The investigating officer has valued the gold articles at Sl.No.11(D) at Rs.5,04,845/-. However, the trial Court has not - 9 - NC: 2025:KHC-D:1178 CRL.A No. 100335 of 2016 taken the valuation of the gold articles, stating that these articles are ancestral properties and were declared in the Annual Property Records at the time joining the duty till the date of search. 18. Insofar as the Schedule-‘C’ Expenditure, the expenses valued by the Investigating Officer and the trial Court are more or less similar. Insofar as the valuation of income of the accused and his wife, the business income of the wife of the accused from 2005- 06 to 2009-10 has not been taken into account by the Investigating Officer. However, the trial Court has taken the same at Rs.11,57,722/- based on the income tax returns filed by the wife of the accused and the said income was earned during the said period by the wife of the accused who is the tailor by occupation. Admittedly, the sewing machine, scissors and measuring taps were seized from the house of the accused. 19. Insofar it relates agricultural income at Sl.No.3.1 to 3.7, the Investigating Officer has taken the income of the accused from other source of income at Rs.5,77,000/-, Rs.6,10,000/- and Rs.1,66,666/- as against the income arrived by the trial Court at Rs.11,79,000/-, Rs.15,85,000/- and Rs.5,00,000/- respectively. 20. The income of the accused from other sources of income assessed by the Investigating Officer is on the basis of the income tax returns only. However, during the course of trial, the accused has produced Ex.P.34 to P.42(A), Ex.P.72 to 76 and Exs.D.1 to 15 21. To establish that the accused and his wife were earning agricultural income from the date of joining duty till the date - 10 - NC: 2025:KHC-D:1178 CRL.A No. 100335 of 2016 of search, the accused has also produced the receipt issued by the Sugar Factory for having purchased the sugarcane from the accused and his wife for the entire check period. 22. Accused has also produced the bank account to establish that the amount paid by the Sugar Factory has been credited to his account. P.Ws.8 to 10 who are the employees of the Sugar Factory and the Bank Manager have admitted that the accused and his wife have supplied sugarcane to the Sugar Factory and in lieu of the same, the Sugar Factory paid money for having purchased the sugarcane and the money has been credited to the account of accused. 23. The trial Court after considering the evidence on record in proper perspective has rightly held that the accused was not possessing assets disproportionate to known source of income. I do not find any illegality in the impugned judgment of acquittal passed by the trial Court. Accordingly, I pass the following: ORDER The appeal is dismissed. Sd/- (HEMANT CHANDANGOUDAR) JUDGE AC CT:VH List No.: 1 Sl No.: 31