A piece of property being in the name of an income tax assessee by itself cannot be a ground to hold that it actually belongs to him/her, the Supreme Court has held.

“In case this proposition is accepted, it will lead to disastrous consequences. It will give an opportunity to corrupt public servants to amass property in the name of known persons, pay income tax on their behalf and then be out from the mischief of law,” said a Bench of Justices C.K. Prasad and M.Y. Eqbal.

Writing the judgment, Justice Prasad said: “While passing orders on discharge at the time of framing of charges in cases under the Prevention of Corruption Act, the probative value of the materials has to be gone into, and the court is not expected to go deep into the matter and hold that the materials would not warrant a conviction.”

The Bench allowed appeals filed by Tamil Nadu against a Madras High Court judgment discharging the former DMK Ministers, Suresh Rajan and K. Ponmudi, and their family members from assets cases registered against them. While the trial court said there was enough material for framing charge, the High Court, on appeal, discharged the accused. The present appeals, filed belatedly, were directed against this judgment.

The case against Mr. Suresh Rajan was that he was in possession of property, disproportionate to the known sources of his income, to the tune of Rs. 23,77,950.94, while the property of his father, mother, elder sister and his bother-in-law was found to be Rs.17,58,412.47. In the case of Mr. Ponmudi and his sons, it was Rs.3,08,35,066.97.

The Bench said: “True, at the time of consideration of the applications for discharge, the court cannot act as the mouthpiece of the prosecution or act as a post-office and may sift evidence in order to find out whether or not the allegations made are groundless so as to pass an order of discharge. It is trite that at the stage of consideration of an application for discharge, the court has to proceed with an assumption that the materials brought on record by the prosecution are true and evaluate the materials and documents with a view to finding out whether the facts emerging therefrom taken at their face value disclose the existence of all the ingredients constituting the alleged offence.”

To put it differently, the Bench said, “if the court thinks that the accused might have committed the offence on the basis of the materials on record on its probative value, it can frame the charge; though for conviction, the court has to come to the conclusion that the accused has committed the offence. The law does not permit a mini trial at this stage.”

The Bench said: “This was not the stage where the court should have appraised the evidence and discharged the accused as if it were passing an order of acquittal. The surviving respondents are directed to appear before the respective courts on February 3. The court shall proceed with the trial from the stage of charge in accordance with law and endeavour to dispose of the same expeditiously.”

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