Holding

The Supreme Court upheld the convictions of the senior officials and certain contractors for conspiracy to cause wrongful loss, reduced their sentences under the proviso to Section 5(2), and acquitted those whose convictions were unsustainable due to procedural defects.

Summary

The case concerned the alleged conspiracy by senior officials of the Jammu & Kashmir Power Department to award transport contracts for bamboo poles at inflated per‑kilometre‑per‑pole rates, causing wrongful loss to the State. The prosecution proved that the officials deliberately selected non‑transport firms, fixed unreasonable rates, and allowed transport of more poles than required, thereby sharing the excess profit. The Supreme Court held that the officials had abused their positions, satisfying the elements of conspiracy under Section 5(2) of the J&K Prevention of Corruption Act and the related Ranbir Penal Code provisions. It rejected the defence that Section 10 of the Evidence Act did not apply and that the accused were not put to the crucial facts under Section 313 CrPC, finding the convictions for the main officials and certain contractors valid. Applying the proviso to Section 5(2), the Court reduced the imprisonment of the principal offenders to one month (two months for the senior officials) while upholding the fines, and acquitted other accused where procedural safeguards were lacking. The appeal was disposed of with convictions upheld, sentences modified, and several appellants acquitted.

Issues considered

The applicability of Section 5(2) of the Jammu & Kashmir Prevention of Corruption Act to the alleged conspiracy and wrongful loss.
Whether the rates fixed for transport were unreasonable and amounted to abuse of position under the Act.
Whether Section 10 of the Evidence Act applies to the alleged inter‑se conspiracy among contractors.
Whether the accused were denied the opportunity to explain material facts under Section 313 of the CrPC.
The effect of the proviso to Section 5(2) on sentencing in view of the elapsed time and hardship.
The impact of the acquittal of higher‑ranking officials on the conspiracy charge against the remaining accused.

Legislation cited

Code of Criminal Procedure, 1973s. 313
Indian Evidence Act, 1872s. 10

Subjects

corruptionconspiracypublic procurementtender manipulationwrongful loss to StateEvidence ActCrPC Section 313sentencing provisoabuse of positionJammu & Kashmir

Judgment

GHULAM DIN BUCH ETC. ETC. A
v.
STATE OF JAMMU AND KASHMIR

APRIL 3, 1996

B
[G.N. RAY AND B.L. HANSARIA, JJ.)

(Jammu & Kashmi1) Prevention of Comtption Act, 2006 ( 1949 AD) :
Section 5(2).

Conspirac)~Accused causing wrongful loss to Statt~ontract given for C
transportation of 10, 000 bamboo poles against actual need of 4, 70~n per
kilometer per pole basis-Notice inviting tendeJJ specified this number as
about 6,00o-No efforts made to get Govemment vehicles for transportation
of poles-Rates paid to contractors-Unreasonable-Notice inviting
tenders-Issued as per pre-arranged plan to Jinns of co-accused not engaged D
in transportation business-Ultimately their tenders accepted-Held : accused
rightly convicted-Prevention of Comtption Act, 1947, Section 5(2}-Ranbir
Penal Code, Sections 120-B, 109/1161119-l'enal Code, 1860 Sections 120-B,
109/1161119.

Section 5(2) proviso-Se11tence-Mitigating circumstances-Causing E
lvrongful loss to State-Offence conunitted about tlvo decades back-Accused
already suffered in body and mind-Held: it was fit case for invoking proviso
to Section 5(2}-Sentence reduced to Rl for two months-Prevention of
Comtption Act, 1947, Section 5(2) proviso.
F
Transpottation of bamboo poles-Coll/ract for-Accused effecting cost
analysis-Justifying the higher rates tendered by contractm:1~Rates found
unreasonabl~Matter dealt with in e:rtre1ne huny-No enqHi1y about prevail-
ing rates madi:--Held : accused 1ighlly convicted because of their apparent
coniplicity in reconunending the acceptance of the rate~~ characte1ising the
sanie as justified. G

Transpottation of bamboo poles-Between 20 to 30 feet length-Ac-
cused allowed tra11spo1tation of poles below 20 feet leitgtlt-No payment
niade for such poles-No financial loss caused to Stat<-'--Held : accused
committed no offence. H
1121
1122 SUPREME COURT REPORTS [1996] 3 S.C.R.

A Evidence Act, 1872 :

Section llJ-Non-applicability---Plea of-Oiarge of compirac.1~Ab
sence of-Effect-Close relationship existed between co11tract01:1" who acted in
conceit-Held : absence of charge of conspiracy inter-se between colllractors
not mate1ial.
B
Code of C!iminal Procedure, 1973 :

Section 313 : Cimunstances coming on record i11 respect of which
accused 1101 exami11ed-Accused 11either asked about his having e11tered illlo
C co11spiracy with anybody-Nor about rates of caniage of poles whether w1-
reaso11able or high-Held : these circumsta11ces could 11ot be used against the
accused-Fwther these circumsta11ces being crnx of the prosecution case
11011-providing of opportu11ity lo him lo explai11 the same rendered his convic-
tion unsustainable.

D The appellants were convicted under Section 5(2) of the (Jammu &
Kashmir) Prevention of Corruption Act, 2006 (1949 AD) read with Sec-
tions 120-B, 109/116/119 Ranbir Penal Code.

According to the prosecution the appellants were entrusted \\ith the
E work of electrification of tehsils for which a lot of bamboo poles were '
required. With the onset of the fruit season all available transport was
diverted to carry fruits and no transport was available for electrification
work. This apart, food grains were required to be stored in the valley and
tehsils to cater to the needs of the people during winter season. This being
high priority area, the concern of the Government was to see that this work
F did not suffer for want of transport vehicles.

The work was to arrange transport vehicles to carry required num-
ber of poles to the tehsils before the onset of winter season, after which the
region became virtually inaccessible. This situation permitted the appel-
lants to take advantage of the same and a conspiracy was hatched to give
G contract of transportation to such persons who showed their willingness
to share the booty with the officers. The conspiracy came to the notice of
the Minister as some complaints were received by him regarding giving of
contracts of transportation to private firms on per kilometre per pole
basis and the poles being also of sub-standard quality. The appellants had
H effected cost analysis in extreme hurry and justified ·the rates which were
G.D. BUCHv. STATE 1123

found unreasonable without making any further enquiry about prevailing A
rates. Tht:y had made no t!fti:Jrts to get Government vehicles for carriage
.. of poles although trucks were availalile in the Mechanical Division. They
had given the contract for transportation of 10,000 poles as against the
need of about 4,700 poles and wrongly allowed loading and unloading
charges. They had also allowed transportation of poles below the length of
20 feet. An enc1uiry was ordered into the matter, after completion of which,
B
a charge-sheet was submitted against the appellants- accused.

On the basis of evidence adduced on behalf of the prosecution, the
trial court came to the conclnsion that the charges levelled against the
appellants-accused were fully established. This finding was upheld by the
High Court.
c
In appeal to this Court, on behalf ofthe appellants it was contended
that payment on the basis of per kilometer per pole was not a new device
adopted for the first time, but had been in vogue for a long time; that the
rates were quite reasonable; that in order to implement the electrification D
scheme before the onset of winter season trucks made available by the
contractors had to be engaged as the Road Transport Corporation ex-
pressed difficulty in making the same available; that the rates had been
l
fixed after inviting tenders and the lowest tender was accepted; that
Section 10 of the Evidence Act, 1872 was not applicable as there was no
E
charge of conspiracy against the three contractors; that no motive could
"be ascribed if 10,000 poles were transported; that the circumstances com-
ing on record were not put to them when they were examined under Section
313 of the Code of Criminal Procedure, 1973 for which reason the cir-
cumstances had to be excluded from consideration; that no other data or
material was available in the otlice of the Chief Engineer tiJ make an F
enquiry about the rates; that omission of enquiry did not show any guilty
mind that no payment was made for carriage of poles below the length of
20 feet; and that they had suffered in body and mind and, therefore, a
lenient view should be taken while awarding the sentence.

Disposing of the appeal, this Court
G

HELD : 1.1. The Road Transport Corporation (RTC) functioning in
~·
the State which owns a fleet of vehicles, used to charge on the basis of per
truck, and not per k.m. The private transport carriers also used to charge
the same amount per truck. It was the obligation of the appellants to bring H
}

1124 SUPREME COURT REPORTS [1996] 3 S.C.R.

A the poles from to forest the the stocking/dumping site. The payment of
loading and unloading charges resulted in additional burden on the State
Exche<1uer. Although trucks were available in the Mechanical Divisions no
efforts had really been made by the appellants to get the Government
vehicles. Hence the rates agreed to with the contractors. were not
reasonable. (1131-D-E; 1133-B; 1134-D-F; U33-F]
B
1.2. Under normal circumstances, giving of contract, following is-
suance of tender notice, to the lowest tenderer cannot be regarded as
objectionable in any way. In the case at hand, however, issuance of Notice
Inviting Tender (NIT) was as per pre-arranged plan. What ·has made the
C matter worse for the appellants is the acceptance of the tender by the
contractors which, apparently was not a firm engaged in the business of
transport. (1135-D; G-H]

1.3. An understanding had been arrived at between these firms/per-
D sons and the tender exercise was a camouflage. This conclusion gets
fortified when it is noted that though according to the officials, tenders
had been received from so1ne transport carriers, in fact it was not so. The
lowest amounts tendered were also those about which there had been a
meeting of mind between the tendere1· and appellants. It is unbelievable
that without such an understanding, the contractors would have under-
E taken the work of transport even before the NIT was issued. They must
have done so, on being told what the lowest rates would be, at least, could
be. Non-transporters were brought in the picture even when firms of
transporters were known to exist and there was no dearth of trucks proved
by the fact that the three contractors could arrange many trucks within a
F short span only because of some prior understanding with them to share
the extra profits with the officials. And this extra profit was ensured by
allowing carriage per pole per k.m. basis, though the contractors themsel-
ves engaged trucks on lumpsum basis. So, everything pieces well; all acted
concertedly to allow wrongful gain to the contractors on the understanding
that the booty would be appropriately shared. (1136-A-B; 1137-C-F]
G
1.4. There is no doubt that the first and second appellants played
key role in giving of the contracts and formed the inner circle of the ~
conspiracy. There can also be no doubt that their actions were actuated by
ill motive, and the same was not inspired to get the poles at site to see that
H the electrification scheme gets shape before winter sets in. They got
1
'

G.D ..'ifUCHv. STATE 1125

transported about 10,0011 poles as against the need of about 4,700. The NIT A
itself had specified this number at 6,000. As the rate at which the poles
were agreed to be carried were unreasonable, there was motive in allowing
carriage of poles beyond what was strictly needed. The greater the number
of poles carried, the higher would be the amount which become payable to
the contractors because of the rate being per pole; and the high profit B
would benefit these appellants also. Thus a case of conspiracy to cause
wrongful loss to the State had been made out against these appellants.
They were rightly found guilty of the charges, which C(Ua them were
commission of offence under Section 5(2) of the (Jammu & Kashmir)
Prevention of Corruption Act, 2006 (1949 AD) and Sections 120-
B/109/116/119 of the Ranbir Penal Code. [1138-B-F] C

1.5. It would be too harsh to award even the minimum punishment
at this length of time in view of the hardship already undergone and the
amount which the State had ultimately to lose because of the conspiracy.
As about two decades have passed since the commission of the offence and D
as during the interregnum these appellants had undoubtedly suffered in
body and mind it is a fit case where the proviso to Section 5(2) of the Act
should be invoked, which states that for special reasons recorded in
writing, the court may refrain from imposing a sentence of imprisonment
or impose a sentence of imprisonment of less than one year. Though the
proviso permits not to impose a sentence of imprisonment at all and E
confine the sentence to tine only, the present is not a case where the
punishment to be awarded should be only fine, as any softness in this
regard could produce an undesirable result, namely, encouragement to
adoption of corrupt means by public servants which has indeed to be
checked, and not allowed to be encouraged. Keeping in view all the attend· F
ing circumstances, a sentences of RI for two months would be adequate
sentence, apart from the fine of Rs. 15,000, in respect of appellants in
Criminal Appeal No. 521 and 530 of 1981. {1139·F·H; 1140-A-B]

2.1. Sitting in the office of the Chief Engineer it would not have been
difficult for the third and fourth appellants to find out the rate either of the G
RTC or private carriers. The omission to make these inquiries stares one
at the face and so they were rightly prosecuted and ultimately convicted,
because of their apparent complicity in recommending the acceptance of
the rates, characterising the same as justified. This shows the extreme
hurry in which the matter was dealt with. There was no occasion for hurry H
1126 SUPREME COURT REPORTS [1996] 3 S.C.R.

A at that stage inasmuch as transport of bamboo poles had almost been
completed and what remained to be done was only the payment. Thus the
appellants in Criminal Appeal Nos. 523 and 526 of 1981 were rightly con·
victed. However, the substantive sentence awarded on them is reduced to
RI for one month as the main culprits were sentenced to imprisonment for
two months. But the sentence offine is left unaltered. [1142-E-G; 1143-D-E]
B
Abdulla Mohammed Paga1kar v. State (Union Tenit01y of Goa,
Daman & Diu ), [1980] 3 SCC 110, held inapplicable.

3. Though the appellants in Criminal Appeal Nos. 522, 528 and 529
C of 1981. had sought to assist the carriers to cause wrongful gain to them
by allowing transportation of poles below 20 feet, ultimately no financial
loss on this count was caused to the State because the carries had not been
paid for poles carried by them which were below 20 feet. Therefore, these
appellants deserve to be acquited. [1144-H; 1145-A)

D 4.1. As to there having been no charge of conspiracy inter-se between
the three contractors, the same is not material because there was close
inter-relationship between the three firms and all of them acted in concert.
The plea of non-applicability of Section 10 of the Evidence Act, 1872,
therefore, fails. [1146-E)

E Natwar/a/ Sakar/al v. State of Bombay, (1963) Bombay Law Reporter
660, referred to.

4.2. The appellant in Criminal Appeal No. 524 of 1981 was not asked,
in any form, about his having entered into conspiracy with anybody. He was
not even asked that the rates at which poles were carried by him were
F
unreasonable or high. As these allegations/circumstances are the crux of
the prosecution case insofar as he is concerned, the non-providing of op-
portunity to him to explain the same has rendered his conviction unsus-
, tainable. The circumstances coming on record were, therefore, not put to
this appellant when he was examined under Section 313 of the Code of
G Criminal Procedure, 1973 for which reason the circumstances have to be
excluded from consideration. This appellant is, therefore, acquited.
[1145-D-F-H; 1146-A-B; 1149-E)
4.3. As far as the appellant in Criminal Appeal No. 525 of 1981 is
concerned, a perusal of his examination under Section 313 of Cr.P.C.
H shows that the facts which emerged against him were put to him to enable
1'
G.D. BUCHv. STATE [HANSARJA,J.] 1127

him to explain the same. The law, therefore, does not exclude the cir· A
cumstances brought against him. His conviction, therefore, has to be
sustained as there is no doubt about his complicity. In view of the sentence
awarded on the principal accused his sentence is reduced to RI for one
month. [1147-H; 1148-A-B]

Sharad Birdhiclwnd v. State of Maharashtra, [1984] 4 SCC 116, relied B
on.

CRIMINAL APPELLATE JURISDICTION : Criminal Appeal No.
521of1981.

From the Judgment and Order dated 16.4.81 of the .Jammu & C
Kashmir High Court in Cr!. A No. 3 of 1981.

Sushi! Kumar, P. Wadhwani, Ms. Purnima Bhatt and E.C. Agarwala
for the Appellants.

P.L. Handoo, G.K. Kawoosa and Ashok Mathur for the Respondent. D
The Judgment of the Court was delivered by

HANSARIA, J. The 1975 accord with Sheikh Abdullah saw a dynamic
person from Ladakh coming to the fore. He was made a Minister. He
wanted to do many things for Ladakhis. One of the projects which the E
Minister (Shri Sonam Narboo) wanted to get fructified was electrification
of tehsils of Leh and Kargil. The fund for the same was to be provided by
the Central Government under Rural Electrification Scheme. To see that
the .scheme was implemented within time, a separate Electric Construction
• Division was created at Leh. Thif.. was in February 1977. An Executive F
• Engineer was put in charge of the Division and he was one N.A. Salaria,
who was selected because of his dashing character which had come to light
by his getting established a generating station at Choglamsar within record
time. The electrification scheme was taken up after Shri Narboo, who was
Minister for Works, Power, Tourism and Ladakh Affairs, had toured the
area from 5.6.1976 to 13.7.1976. The idea was to electrify areas around Leh G
first for which it was fell that 3100 bamboo poles would be required. It was
aho noted that from September onwards the fruit season starts and all
available transport is diverted to carry fruits lo the plane and no transport
is available for La<lakh. This apart, food grains are required to be stored
in Kashmir valley and Ladakh to cater to the needs of the people during H
1128 SUPREME COURT REPORTS (1996] 3 S.C.R.

A winter season. This being high priority area, the concern of the Govern-
ment is to see that this work does not suffer for want of transport vehicles.

2. It is in the aforesaid situation and scenario that Salaria took up
work in right earnest from first week of September 1977, after the Chief
B Engineer, Electric Maintenance and RE, Kashmir had toured the two
tehsils from 17th to 23rd August, 1977. The work was to arrange transport
vehicles to carry required number of poles to Leh before November, after
which Ladakh region becomes virtually inaccessible. The allegation is that
the situation permitted persons in the Power Department to take advantage
c of the same and a conspiracy was hatched to give contract of transportation
to such persons who showed their willingness to share the booty with the
officers. According to the prosecution, these persons included even the
highest officer of the Power Department, namely, Power Development
Commissioner and it went down to the Sectional Officer. The conspiracy
D came to the notice of none else than Shri Narboo as some complaints were
received by him in November, 1977 regarding giving of contract of
transportation to private firms on per kilometre per pole basis and the
poles being also of sub-standard quality. He wanted information about the
same by writing a D.O. letter to the Power Development Commissioner on
18.11.1977 followed by a reminder on 5.12.1977. After receipt of reply, the
E Minister asked for a report from the Chief Engineer. On receipt of the
same, he felt the matter required deeper probe and appointed Qazi Mohd.
Afzal as Enquiry Officer in December, 1977. His report was submitted on
3.4.1978 which highlighted some serious irregularities. After considering
the report, the Government entrusted the matter for further probe to the
F Anti-Corruption ()rganisation set up under the (Jan1n1u & Kashn1ir)
Prevention of Corruption Act, 2006, (hereinafter the Act). A case was
accordingly rei,~stcrcd on 26.4.1978 and a Senior Superintendent of Police,
one Shri S.S. Ali, was entrusted with the investigation, who after completion
of the same and after obtaining sanction from the Government, submitted
charge-sheet. on 10.8.1978 against 42 accused.
G
3. In the trial which commenced, after discharge of one {a labourer),
65 witnesses were examined by the prosecution and 2 by the defence. Great
number of documents were also exhibited. The trial court by its very
exhaustive judgment dated 29.9.1981, which runs into 420 pages, acquitted
H 11 persons including Power Development Commissioner, Shri Ahangar
1'

G.D. BUCHv. STATE [HANSARIA,.l.) 1129

and Chief Enb~neer, Shri Naqash; and convicted 30 under various sections A
oi' law including section 120-B Ranbir Penal Code and section 5(2) of the
.... Act.

4. On appeal being preferred, the High Court of .Jammu & Kashmir
acquitted 19 more including Superintending Engineer Shri Kaul and sus-
tained conviction of 11 persons who are the appellants in the 10 appeals B
at hand. Of them, 7 are officials and 4 are contractors. The officials are :
(1) Executive Engineer, N.A. Salaria; (2) Assistant Engineer, G.D. Buch;
(3-4) two employees of the Chief Engineer's office - T.K. Kantroo and
V.K. Razdan; (5-7) three officers who had passed the poles-they being H.L.
Dhar, Farooq Ahmed Zadoo and Mohd. Siddiq. The four contractors are; C
(1) Hafeezullah, (2) Farooq Ahmed Qurashi, (3) Abdul Rashid Khan and
( 4) Peer Gulam Nabi.

5. The appeals being by the convicted persons and there being no
appeal against acquittals either by the trial court or the High Court, it is D
apparent that we have to see whether the persons ultima.tely convicted by
the High Court had been rightly found guilty of the charges, inter alia, of
conspiracy. We have mentioned about this aspect at the threshold because
the principal charge being of conspiracy and that too involving highest
officer of the Power Department, and he having been acquitted even by
the trial court along with the Chief Engineer, followed by acquittal of E
Superintending Engineer by the High Court, we shall have to see whether
the links which have been left in the chain of conspiracy do leave a thread
to piece together the actions of the convicted appellants so as to establish
a conspiracy by them.
F
6. Many of the learned counsel appearing for the appellants made a
grievance that the State has allowed higher ups to remain unavailable to
this Court and has thought it fit to press the case against small fry.
According to them if there was a conspiracy at all, the same could not have
been worked out without the connivance of at least the Chief Engineer and
Superintending Engineer. Shri Handon, appearing for the State, felt some G
what uncomfortable at the non-filing of the appeals by the State, first in
the High Court and then in this Court again.st the acquittals of higher-ups.
But then, no appeal having been filed, the ultimate submission was that the
core of the conspiracy had not been adversely by the acquittals and the evil
design resulting in causing wrongful loss to the State Exchequer by causing H
1130 SUPREME COURT REPORTS [1996] 3 S.C.R.

A wrongful gain to the contractors and themselves has to be punished.
Differently put, the submission was that the inner circle of the two con-
centric circles has not been damaged because of the outer circle. getting
wiped out. According to Shri Handoo, therefore, the acquittals of the
higher-ups cannot per se see the acquittals of the appellants.

B 7. To appreciate the aforesaid submission, we have basically to note
the key role assigned to appellant Salaria who, according to the prosecu-
tion, was duly supported by appellant Buch. These two according to Shri
Handoo were the main actors in the drama, which was enacted about two
decades back in an area which had not seen a conspiracy of the type at
C hand causing loss of lacs to the State Exchequer, which had drawn atten-
tion even of the State Cabinet.

8. Loss of lacs (the total loss to the State Exchequer having been
estimated at Rs. 1, 62, 117, 89) was undoubtedly of great concern two
D decades earlier and we can appreciate the great consternation this case
had caused in the State requiring appointment of a senior Session Judge
to constitute the Special Court under the Act to try the case. The heroic
effort made by the prosecution to bring home the guilt also speaks for itself.
The lapse of time, therefore,. cannot be allowed to come to the aid up the
appellants, as has been one of the submissions on behalf of the appellants,
E based on the fact of long suffering already undergone. We would, there-
fore, examine the materials on record objectively without being influenced
by the hardship undergone, which could be taken note of, if need would
arise, while dealing with the question of sentence. May it be stated that we
would undertake this exercise as we are satisfied about the core of con-
F spiracy, referred to by Shri Handoo as inner circle of the conspiracy, having
remained unaffected despite aforesaid acquittals, as would appear form
what is being stated later.

9. The first and foremost question which needs to be looked into is
whether the acts attributed to the appellants were at all meant to cause
G wrongful loss to the State by the alleged conspiracy. Almost all the learned
counsel appearing for the appellants were at pains to convince us that the
arrangement which was made with the contractors to carry poles was not
at all aimed to cause any wrongful gain to them inasmuch as payment on
.
the basis of per kilometer per pole was not a new device adopted in 1977
H for the first time, but that had been in vogue al least since 1971. This apart,
G.D. BVCHv. STATE[HANSARIA,J.] 1131

the rates which were agreed upon was also quite reasonable. The same was A
30 or 35 paise per k.m. per pole depending upon the size, which is in the
close neighbourhood of what had been paid even in 1976 for carrying poles
to Leh ;tself by the arrangement finalised by Shri Bassu, who was the
immediate predecessor of Salaria. Shri Harn.loo seriously contested this
claim and urged that per k.m. basis had been adopted for the first time in B
1977 for long haulage; in earlier years this was being accepted for carrying
materials to short distances. As to the reasonableness of rates, the State's
case is that the amount agreed to be paid was almost three times of what
was being paid earlier.

• 10. We would, therefore, first examine the aforesaid crucial question. C ·
We would then see whether the giving of contract at the lowest tendered
rate made any difference.

Reasonableness of the contractual rates.
D
11. There is no dispute before us that .the Road Transport Corpora-
tion (RTC) functioning in the State of Jammu & Kashmir, which owns a
fleet of vehicles, used to charge on the basis of per truck, and not per k.m.
This rate was Rs. 1400 in the relevant year. The private transport carriers
aho used to charge the same amount per truck. But then, the number of
poles to be carried by these trucks to a place like Leh used to be around E
25. This made a difference, according to the learned counsel for the
appellants, as the number of poles carried by the trucks which had been
engaged by the contractors at hand used to be even 70. Shri Handoo
contended that though the. number of poles carried were more, the same
did not really matter inasmuch as total cft. (cubic feet) transported was not F
in any significant manner more than carried by the trucks of RTC of private
transport owners because each of those trucks used to carry about 280 cft.
whereas from Statement No. 2 filed by Shri Thakur it would appear that
the cft carried in the present case ranged between 200 to 300, though in
some cases it went upto 400 also. As to the contention that the rates of
carriage per pole came to 30.49 paise insofar as the transportation done G
by Shri Bassu is concerned, Shri Handoo's submission was that this cal-
culation as put on record on behalf of the appellants is wrong. As per his
contention the per pole rate then was 9.36 paise as mentioned in the
Charge-Sheet filed in the case, a copy of which is from pages 1 to 86 of
Volume 1 o' the Paper Book prepared by the appellants. This figure has H
1132 SUPREME COURT REPORTS [1996] 3 S.C.R.

A been mentioned at page 72 of this Volume.

12. As to the calculation furnished on behalf of the appellants the
same being that the rate was Rs. 30.49 per pole if what was paid for the
carriage to Leh in 1976 during the incumbency of Shri Bassu - we would
observe that calculation has been arrived at by showing, inter alia, that the
B charge of loading and unloading per pole at Rs. 52. When Shri Thakur was
questioned on this, the learned counsel had referred us to the evidence of
the Investigating Officer (1.0.) finding place at page 230A of Volume IV.
A reference to that statement showed that the unloading charge came to
Rs. 18 per pole and the loading charge to Rs. 7.80. Thus the total came to
C about Rs. 26 from stocking site to the truck. The learned counsel con-
tended that this figure had to be doubled because the same amount used
to be incurred of bringing poles at the stocking site from the forest. The
1.0. had not said anything about this on his own, nor was he asked any
such question in cross-examination. However, to convince us that the figure
of Rs. 26 is required to be doubled, in the written submissions filed on
D 21st/27th March, the learned counsel appearing for the appellants quoted
the following evidence of PW 24 Bassu :

"Expenses for loading and unloading as well as the manual
carriage from loading site and unloading site. For manual carriage
E of the poles we have to pay extra. By referring to the manual
charges I mean the lifting of poles by manual labourers from Depo
site to the truck and also their removal after unloading to the stock
site.

QI When you took these poles for installation from Choglamsar
F you again had to incur expenses for manual carriage, loading and
unloading of poles ?

NYes. 1'

12-A From the above quoted evidence of PW 24, it is not known
G how much had been paid during his incumbency as total loading and
unloading charges. It is not known which instances the 1.0. had in mind
when he had stated about loading and unloading charges. It deserves to be
pointed out that the poles which had been carried in 1977 had basically
been supplied by Mustaq & Company and it was the obligation of this firm,
H as per Shri Handoo, to bring the poles from the forest to the stock-
-
G.D. BUCHv. STATE [HANSARIA,.l.J 1133

ing/dumping site. What is more important is that the decision which was A
taken in the joint meeting held on 11.5.77 was that the poles would be
carried from Kangan and Sonmarg vide page 22 of Vol. III. Mention has
been made about this in para 69 of the charge-sheet also, which is at pages
1-86 of Volume I. But for some inexplicable reason, the stocking/dumping
site was changed and poles were carried from Waltab which resulted in B
additional burden on the State exchequer. Shri Handoo made a serious
grievance about this change of site.

13. For the aforesaid reasons, we do not accept the contention of the
appellants that loading and unloading charges when poles were carried
during the incumbency of Shri Bassu came to Rs. 52. Therefore, we would C
not agree that the rate of carriage per pole in 1976 was Rs. 30.49. So, we
accept the prosecution case that the rates agreed to in the present case
were not reasonable. This is almost writ large on the face as the carrying
charge per pole came to Rs. 144.60. This has come out clearly in the Office
Note, which starts at page 12 of Volume IX. (This figure has been men- · D
tioned at page 13). In this context, it would be apposite to refer to what
has been stated in the impugned judgment of the High Court at page 158
of the volume containing this judgment. It has been mentioned therein that
the payment made to the contractors showed that the same per truck
worked out to Rs. 10, 561, 66, whereas the rates of the RTC would have
been Rs. 1993.57. The same would have been even less (Rs. 1839.57) if E
trucks of private carrier would have been engaged.

14. Being satisfied that the rates agreed to with the contractors were
not reasonable, let it be seen whether the higher was payment wa.'
motivated or was agreed upon to take of the exigency of the situation. Shri F
• Thakur strenuously urged that implementation of the rural electrification
scheme within the time spelt out by the Minister was the need of the hour,
for which purpose a dashing character like that" of Salaria was brought to
the scene. The concerned persons were duty bound to do all that could
reasonably be done to carry poles to Leh before the onset of winter season
which cuts off Ladakh from the Valley for a long period The fruit growing G
season being round the corner and the need for storing food for the winter
being the prime concern of the Government, the concerned officers had to
implement the scheme before the onset of winter and had on alternative
but to engage trucks made available by the contractors as the RTC had
expressed difficulty in making the trucks available. To satisfy us that there H

<
...... •

,
1134 SUPREME COURT REPORTS (1996J 3 S.C.R.

A was no evil design in giving _the contract of carriage to non-transport firms,
it was also urged that the rates had been fixed after tenders had been
invited and the lowest tender was accepted.

15. Shri Handoo would not like us to accept the aforesaid statements
because, according to him, large number of Government trucks could be
B used for the purpose if proper approach would have been made. In this
connection, he referred us to the communication from the <ifftce of the
Transport Commissioner to the Investigating Officer (1.0.) dated 24.5.78,
which is at pages 269 to 270A of Volume VII. It has been mentioned
therein that the State had about 4,000 trucks operating on J & K roads
C only and about 400 to 800 trucks used to lie idle everyday. This letter
further informed the 1.0. that no officer of the Electric Department had
approached the office of the Transport Commissioner for arranging trucks
for the carriage of poles. The further statement was that the Minister for
Ladakh had personally contacted the writer on 5th November, 1977 stating
D about the urgent need of transporting four lac litres of High Speed Diesel
to Leh and despite shortage of time they were able to complete the massive
operation within three weeks. We have also been referred by Shri Handoo
to the evidence of PW 29, Shri SD Shangllo, Executive Engineer, Mechani-
cal Division, Srinagar, which is at page 48-49 of Volume IV that their
Department was having 39 trucks in its fleet and they had received no
E requisition from REC Leh for carriage of poles.

16. The aforesaid· does show that no efforts had really been made by
the concerned officers to get the Government vehicles. Shri Thakur and
Shri Jain, however, urged that before floating of tender, RTC officials had
F been personally contacted by Salaria and on being staled that trucks could
not be made available "at the present time", the exigency of situation left
no alternative but to invite tenders. This information to Salaria was in the
doc>'.lnent which is at page 256 of Volume VII. The catch, however, is that
wheti the signatory of this letter, Sardar Jai Singh, appeared the witness
box as PW 2 he deposed that on his being approached by Salaria on 15th
G September, 1977 what he had really told was that there was no objection
to supply of trucks but due to earlier commitments with other departments
trucks could not be supplied for "2 to 3 days". Salaria however did not come
--
subsequently asking for trucks and so no trucks got supplied by the RTC.
Shri Thakur contended that this gloss put by Jai Singh does not merit
H a?ceptance, as, if that was what was really told to Salaria, the same should
'

\
G.D. BUCH v. STATE [HAN SAR IA, J.) 1135

have found place in the aforesaid communication; In this context we were A
taken through the various questions which were asked to Jai Singh on this
aspect and which find place from pages 50 to 55 of Volume III. If the
evidence of J ai Singh alone would have been on record, we could have
perhaps agreed to what was submitted by the learned counsel for the
appellants in this regard; but having noted what had been stated by the B
Transport Commissioner in the afore-noted letter and what !tad been the
evidence of the Executive Engineer, Mechanical Division, we are of the
view µiat Notice Inviting Tender (NIT) came to be issued as pre-arranged,
to which aspect of the matter we shall advert now. . ,,,

Issuance of NIT and subsequent happenings. c
17. Under normal circumstances, giving of contract, following is-
suance of tender notice, to the. lowest tenderer cannot be_ regarded as
objectionable in any way. In tbe case at hand, however, issuance of NIT
was as per pre-arranged plan, as already mentioned. We have said so D
because the same came to be issued, not in the wake of denial, even if there
was any, by the RTC official to make their vehicles available. That tenders
would be invited had been stated even by 8.9.77 by Buch to appellants
Hafeezullah and Qurashi. The letter of Buch of 8th September addressed
to Salaria, which is at pages 50 and 51 of Volume X, mentioned that the E
former had negotiated with M/s. Arfa Electrical Company (which is the
naine of the concern· of appellant HafIZUllah) and M/s. Farooq Ahmed
Qurashi and they had accepted to carry poles from Srinagar Valley to
Kargil and Leh on the condition that the rates of carriage charges could
be those which would be found lowest after floating tender. Buch further F
stated in the letter the the firms had been advised to start the carriage of
poles : of course, the charges to be paid would be known after receipt of
tender to be floated in this regard. There is thus nothing to doubt that a
decision had been taken with the consent of Salaria to float tenders even
by 8th September. The contact with the RTC official at Srinagar was on
15th and the obtaining of the aforesaid letter from Jai Singh may, therefore, G
just be a ruse for issuance of the NIT. What has made the matter worse
· · for the appellants is that a copy of NIT was sent even to M/s. Khan Electric
and General Stores, the firm of appellants Abdul Rashid Khan and Peer
Gulam Nabi, whose tender was ultimately accepted, which, apparently was
not a firm engaged in the business of transport. H
1136 . SUPREMECOURTREPORTS (1996) 3 S.C.R.

A 18. Shri Handoo, therefore, rightly submitted that an understanding
h_ad been arrived at between these firms/persons and the tender exercise
·~.
was a camouflage. This conclusion gets fortified when it is noted that
though according to the officials, tenders had been received from some
transport carriers, to wit, Sopore Transport Workers' Union, in fact it was
B not so. This has transpired from the evidence of PWs 21 and 22, who were
the Manager and President respectively of the Sopore Transport Workers'
Union. Both of them stated that their Society had not submitted any tender
and the one which was said to have been filed in its name had really not
emanated from their office. Even the seal put in the tender was not theirs
C and the tender had not been signed by any authorised person. Sbri Thakur
urged that tender might have been signed by the Accountant, who was in
employment at Srinagar Branch, as admitted by PW 22 in his cross-
examination. Sbri Handoo replied that PW 22 had stated that the Account-
ant was not authorised to submit quotations. We are inclined to think that
similar must have been the position qua some other transporters who bad
D purportedly submitted tenders. Shri Handoo further contended that the
NIT had been issued to selected persons as would appear from the
evidence of PW 19 (at page 220 of Volume II) to the effect that his firm
bad not received any tender notice. The firm of this witness, named
Diamond. Motors, was a leading transporter of Srinagar as about 100 trucks
E were attached to his firm. '
\

19. At this stage we may indicate that the frrms styled as Arfa
Electrical Company and Khan Electrical and General Stores are closely
knit, as would appear from the evidence of DW 1 Farooq Uddin, who
F stat~d about his being a partner in the firm of Arfa Electrical Company, .
alongwith Hafeezullah. Though he stated in the examination-in-chief that
his frrm bad nothing to do with the firm of Khan Electric and General
Stores, from the statements made by him in cross-examination it appeared
that Ar fa Electrical Company was not rtinning a ,shop and that firm had.
G no hCadquarter. He further stated that Hafeezullah used to run his father~s
shop named Khan Electric and General Stores ·and correspondence for
Arfa Electrical used to be from the shop of Khan Electric. He further
admitted that Afra Electrical had no registration with ·the Sales Tax
{
Department Even the bill-head of Khan Electric and General Stores was
H used by Arfa Electrical after erasing the name of the former and overwrit-

I
G.D. BUCHv. STATE [HANSARIA,J.] 1137

ing name of the latter. These statements do show the inter relationship and A
closeness of Arfa Electrical Company and Khan Electric and General
Stores.

20. The above is not all inasmuch as there is material on r\cord to
show that Qurashi is related to Hafcezullah being a son of his father's B
brother-in-law. This would definitely indicate that Qurashi too had acted
in concert with Hafeezullah.

21. The aforesaid facts leave no doubt in our mind that the exercise
of issuing the NIT and accepting the tender of Khan Electric and General C
Stores were parts of pre-arranged plan. We have reasons to believe that
the lowest amounts tendered were also those about which there had been
a meeting of mind between the tenderer and appellants Salaria and Buch,
if not others. We are inclined to think so because it is not believable that
without such an understanding, Arfa Electrical and the firm of Qurashi
would have undertaken the work of transport even before the NIT was D
issued. They must have done so, on being told what the lowest rates would
be, at least, could be. There is much merit in the submission of Shri
Handoo that the non-transporters were brought in the picture even when
firms of transporters were known to exist and there was no dearth of trucks
proved by the fact that the three contractors could arrange 132 trucks E
within a short span of 8.9.77 to 7.11.77 only because of some prior under-
standing with them to share the extra profits with the officials. And this
extra profit was ensured by allowing carriage per pole per k.m. basis,
though the contractors themselves engaged trucks on lumpsum basis. (This
figure was given as Rs. 8000 by OW 1). So, everything pieces well; all acted
concertedly to allow wrongful gain to the contractors on the understanding F
that the booty would be appropriately shared.

22. Having come to the aforesaid conclusion which does make out a
case of conspiracy to cause wrongful loss to the State, let it be seen whether
the appellants herein were the conspirators; and, if so, whether the charges G
against them have been brought home in accordance with law. We propose
to examine this qua each of the appellants separately. We would first take
up the case of the two persons, who had played the key role in the
conspiracy according to the prosecution. They are appellants N.A. Salaria,
the then Executive Engineer; and G.D. Buch, the then Assistant Engineer. H
1138 SUPREME COURT REPORTS [1996] 3 S.C.R.

A Appellants NA. Sala1ia and G.D. Buch
(Criminal Appeal Nos. 521 and 530/1981)

23. There is no doubt, in view of what has been stated above, that
they played key role in giving of the contracts and formed the inner circle
of the conspiracy. There can also be no doubt in view of what has already
B been held that their actions were actuated by ill motive, and the same was
not inspired lo gel the poles ar Leh to see that !he electrification scheme
gets shape before winter sets in. Apart from what has already been men-
tioned about the tainted steps taken by them, Shri Handoo has brought to
our notice another facet of the case, which was to get transported about
C 10;000 number of poles as against the need of about 4,700. The NIT itself
had specified this number as about 6000.

24. Shri Thakur learned senior counsel who appeared for Buch,
contended that the total requirement for 1976-77 came to about 12,400;
and as during Bassu's period only about 2,000 poles could be carried, no
D motive could be ascribed if 10,000 poles were transported during the
period in question.

25. We would have accepted the submission of Shri Thakur, but
having found that the rate at which the poles were agreed to be carried
E were unreasonable, we read motive in allowing carriage of poles beyond
what was strictly needed. The greater the number of poles carried, the
higher would be amount which would become payable to the contractors
because of the rate being per pole; and the high profit would benefit the
appellants also.

F 26. Nothing further remains to be said lo come to the conclusion that
these appellants were rightly found guilty of the charges, which qua them
were commission of offences under section 5(2) of the Act and 120-
B/109/116/119 Ranbir Penal Code. At this stage we say something about
the submission made by Shri J ethmalani, who had appeared for two of the
contractors namely Hafizullah and Farooq Ahmed Qurashi, that the charge
G having only mentioned about section 5(2) was not quite explicit inasmuch
as it did not spell out which particular misconduct specified in sub-section
(1) of section 5 was being attributed. The learned counsel further submitted
that of all the four types ·of misconducts raken care of by sub-section (1)
in its four clauses, it is the one mentioned in clause (d) which could apply,
H which speaks of abuse of the position by a public servant by "corrupt or
G.D. BUCHv. STATE [HANSARIA,J.] 1139

illegal means". The contention as to this clause was that no corrupt or A
illegal means had been adopted by the public servants because the contract
had been given following invitation to submit tenders which is a known and
legal n1odc of giving contracts; it was in also not a corrupt means. There
is no force in this contention, as the undertaking given to the aforesaid two
contractors that they would be allowed to carry poles at the lowest
tendered rates fellowed by how the NIT was issued and what happened
B
thereafter, there can be no dispute that the public servants in question did
abuse their position. It so deserves to be noted that clause (d) does not
speak only about "corrupt or illegal means" but also takes within its fold
obtaining by public servant for himself or for any other person any
pecuniary advantage "otherwise" as well. We, therefore, do not find any C
infirmity in the charges as framed.

27. So, we uphold the conviction as awarded against these appellants.
Coming to the question of sentence, we have noted that section 5(2} of the
Act has stated that the punishment shall not be less than one year's D
imprisonment but may extend to seven years. The trial court, being satisfied
about the need of deterrent punishment had awarded imprisonment for
four years and a fine of Rs. 25,000. The High Court has, however, reduced
the sentence to two years and fine too has been reduced to Rs. 15,000,
despite of having noted that evil of corruption had of late assumed menac-
ing proportion and was the deadliest enemy of a free civilised. society. E

28. According to us, it would be too harsh to award even the
minimum punishment at this length of time keeping in view the hardship
already undergone and the amount which the State had ultimately to lose
because of the conspiracy - the same being a sum of Rs. 1,62,117.89. As F
about two decades have passed since the commission of the offence and
as during the interregnum the appellants had undoubtedly suffered in body
and mind, according to us, it is a fit case where the proviso to sub-section
(2) of section 5 of the Act should be invoked which states that for special
reasons recorded in writing, the court may -refrain from imposing a sen-
tence of imprisonment or impose a sentence of imprisonment of less than G
one year. Though the proviso permits not to impose a sentence of imprison-
ment at all and confine the sentence to fine only, we do not think if present
• is a case where the punishment to be awarded should be only fine, as any
softness in this regard could produce an undesirable result, namely, en-
couragement to adoption of corrupt means by public servants which has H
1140 SUPREME COURT REPORTS [1996] 3 S.C.R.

A indeed to be checked, and not allow lo be encouraged. Keeping in view all
the attending circumstances, we are of the view that a sentence of RI for
two months would be adequate sentence, apart from the fine of Rs. 15,000.
On failure to pay the fine, each of the appellants would suffer imprison- ..
menl for two months.

B 29. Crl. Appeal Nos. 521 and 530 of 1.981 therefore, stand dismissed,
subject lo the aforesaid modification in sentence.

Appellants T.K. Kantroo and V.K. Razdan
(Criminal Appeal Nos. 523 and 526/1981)
c 30. These appellants were working at the relevant time as Assistant
Engineer and Sectional Officer in the office of the Chief Engineer and,
according to the prosecution, they had affected cost analysis and had
justified the proposal which had been submitted by appellant Salaria to the
Chief Engineer seeking his approval to the rates tendered by Khan Electric
D and General Stores.

31. What had happened was that after the bills had been submitted
by the contractors for payment, an objection was raised by the Accountant
relating to non-approval of the contract by the Chief Engineer. This needed
E clearance of the Chief Engineer for which purpose Salaria addressed a
communication on 4.10.1977 to the Chief Engineer (a copy of which is at
pp.IO and 11 of Volume IX) seeking his approval to the tender rates in
question. In the memo of the aforesaid date, which was endorsed to the
Chief Engineer Salaria had mentioned in its margin (and this endorsement,
according to Shri Handoo, is not to be found in the original of the letter)
F stating, inter alia, that the tender rates wen: as per the Superintending
Engineer Memo dated 27.5.1975, a copy of which was also enclosed. After
receipt of this letter on 22nd October, the Chief Engineer desired process- -"
ing of the matter. The file was endorsed to Assistant Engineer Kantroo by
Technical PA to the Chief Engineer on 22nd itself; and Kantroo, in turn
G endorsed the letter to Razdan on 24th.

32. An office note running into 3 and 1/2 pages was prepared by
Razdan on 25th which came to be signed by Kantroo also on that date.
The Technical PA to the Chief Engineer submitted the office note on the •
same date to the Chief Engineer. The Chief Engineer, however, found that
H the standing procedure regulating invitation of the tenders and processing
G.D. BUCHv. STATE [HANSARIA.J.] 1141

the case thereafter had not been followed strictly due to extreme urgency A
• involved as slated by the Executive Engineer. The Chief Engineer in his
nolc, asked the Superintending Engineer to get the case processed at his
level and lo obtain the observation of FA (Financial Adviser) and to gel
the agenda put up thereafter by the Executive Engineer for discussing and
deciding in a committee of the Superintending Engineer, Executive En-
girleer, FA and CAO (or his representative) and himself within a week.
B

33. The aforesaid shows the extreme hurry in which the matter was
dealt by the appellants Kantroo and Razdan. A perusal of the office note,
which is at pages 12 to 15 of volume IX, shows that they regarded the
accepted tender rates as justified solely because of the approval by the
Superintending Engineer, REST (Rural Electrification and Sub-Trans)
c
Circle of the carriage rates in 5/75 ranging between 51 to 75 per km. per
pole. (This document is at page 99 of Volume VII).

34. Shri Handoo contended that the complicity of these two appel-
!ants is apparent from the fact that lhey had confined their attention only D
to the one time approval given by the aforesaid Superintending Engineer
-without at all trying to know as to under what circumstances the rates were
' approved and, what is more without trying to know what were the other
accepted mode of carrying poles and what were the rates thereof.

35. Shri Sushi! Kumar, learned senior counsel appearing for these
E
appellants, submitted that no other data or material was available in the
office of the Chief Engineer, and so, the appellants confined their attention
to the rate about which mention had been made in the communication of
the Executive Engineer. That no other material was available in the office
,. of the Chief Engineer is the evidence of PW. 1 who was the Inquiry Officer. F
?w. 26 who was the Technical PA to the Chief Engineer and, last but not
the least, the IO, PW. 65, also deposed the same.

36. The further submission of Shri Sushi! Kumar was that if these
appellants had omitted to make any further inquiry, about which the
observation of the trial court \Vas that they did not 11 conduct research", the G
~ same did not really show any guilty mind, though that could be a case of
negligence for which departmental action may be merited but not a
criminal prosecution. In this connection our attention was invited to the
recommendation of the Inquiry Officer stating that these appellants have
to "explain their negligence in not trying to ascertain and apprise the Chief H
1142 SUPREME COURT REPORTS [1996] 3 S.C.R.

A Engineer of the vital information appertaining to the carriage rates at
which poles had been carried to Ladakh by ...... " (Page 105 of Volume V.) -<

37. To support him OR the legal submission, we have been referred
to Abdulla Mohammed Pagmkar v. State (Union Tc11it01y of Goa, Daman
B _& Diu), IJ980] 3 SCC 1111. That was also a case where the appellants had
been convicted, inter alia, under Prevention of Corruption Act. While
setting aside the conviction and ordering or acquittal of the appellants, this
Court observed in paragraph 24, to which our attention is invited in
particular, that if the appellants proceeded to execute the work in flagrant
disregard of the relevant rules of the General Financial Rules and even of
c ordinary norms of procedural behaviour of Government officials and con-
tractors in the matter of execution of work undertaken by the government
such disregard had not been shown to amount to any of the offences for
which the appellants convicted. The submission, therefore, was that we may
not read ingredients of any of the offences for which the appellants have
D been convicted merely because of their not having made some enquiries
and having acted against accepted norms.

38. We have found it difficult to agree with Shri Sushi! Kumar
because a perusal of the aforementioned office note clearly shows two
things. First, the extreme hurry in which the assigned work was completed,
E as the file came to Razdan on 24th October and was sent back on 25th,
after the same had been examined, not only by him, bu( Kantroo also.
There was no occasion for hurry at that stage inasmuch as transport of the
bamboo poles had almost been completed and what remained to be done
was only the payment. Secondly, the note discloses that these appellants
F kne\v that the cost of carriage per pole even as per the lowest tenders
would be Rs. 144.60. This must have shocked their conscience and they.
must have tried to know what could have been the cost of poles were
carried, not on the basis of per km. per pole, but as per truck loads. Sitting
in the office of the Chief Engineer it would not have been difficult for these
officers to find out the rate either of the RTC or private carriers. The
G omission to make these inquiries stares one at the face and so they were
rightly prosecuted and ultimately convicted, because of their apparent
complicity in recommending the acceptance of the rates, characterising the
same as justified.

H 39. Shri Sushi! Kumar advanced yet another submission. He urged
G.D. BUCHv. STATE [HANSARIA,J.] 1143

that the acquittal of the Chief Engineer by the trial court and of the A
Superintending Engineer by the High Court show that these courts had not
read any criminal intent in the role they had played in the mailer; and the
same view is merited qua the two appellants. We do not propose to
examine the .iustification or otherwise of the acquittals, because of there
being no appeal against acquittal' before us. It would be enough to point B
out that the Chief Engineer had been acquitted as the trial court took the
view that Salaria was interested in keeping the Chief Engineer ·in dark
about salient features of the contract, because of which it was stated that
the Chief Engineer could not be a conspirator. As to the acquittal of the
• Superintending Engineer what the High Court stated was that he had
neither been informed about the floating of tenders on 17.9.1977, nor was C
taken into confidence when tenders were opened on 27.9.1977. Even a copy
of the NIT had not been sent to him. This apart, the High Court has
referred to a communication addressed by the Superintending Engineer to
Salaria in which the former asked the latter as to why poles were not
carried by RTC trucks and why the carriage contractors had been intro- D
duced. We do not propose to dilate further.

40. We, therefore, conclude by stating that the two appellants were
rightly found guilty. As to the substantive sentence awarded on them, we
would reduce the same to RI for one month, as we have sentenced the
main culprits to imprisonment for two months. The fine of Rs. 3,000 on E
each of the appellants is left unaltered. In default of payment of fine, each
of them would undergo imprisonment for one month.

41. Criminal Appeal Nos. 523 and 526 of 1981 are, therefore, dis-
missed, subject to the aforesaid modification in sentence.
) F
Appellants H.L. Dhar, FA. Zadoo and Mohd. Siddiq
(Oiminal Appeal Nos. 522, 528 and 529 of 1981)

42. The alleged role of these appellants was that they had passed
poles below specification inasmuch as poles below the length of 20 feet G
were allowed to be transported. There is no dispute that the contract was
to transport poles whose length was required to be between 20 feet to 30
feet. This has its importance because poles of smaller size would not have
the required girth which would effect their strength and they would not be
able to with stand the normal wear and tear. Of the aforesaid appellants,
Dhar was a Sect.ional Officer in the Power Development Department, H
)

1144 SUPREME COURT REPORTS [1996] 3 S.C.R.

A Zadoo a Store-keeper cum Clerk and Siddiq a .I unior Clerk engaged on
work charged basis. Their defence was that as poles hclow the length of 20
feet had been transported earlier, they had permitted the same this tune
as well, not knowing that the contract was to carry poles of 20 feet and
above. This defence has to be rejected for two reasons : (1) It cannot be
believed that the Passing Officers would not know about the size of poles
B to he transported; and (2) it is the case of appellant Buch that he had
informed about the size of the poles to be accepted.

43. The High Court has strongly criticised the rule of the Passing
Officers by stating that had they not been parties to the conspiracy, the
entire conspiracy would have flopped and the carriage contractors could '
c not have carried such a great number of poles in such short span of time
and could not have earned so much.

44. Shri Agarwal, learned senior counsel appearing for these appel-
lants, contended that even if it were to be accepted that these officers were
D informed about the contract being to' carry poles of 20 feet and above, the
poles below 20 carried were small in number and the percentage of the
pole so carried was in the neighbourhood of what had been done earlier.
From Statement No. 4 filed in the case by Shri Thakur, it appears that even
R TC trucks and private carriers, who too were supposed lo carry poles of
the length of 20 feet and above, had transported some poles below 20 feet,
E whose percentage came to 20.9, whereas the percentage of such poles
transported by the three carriers contractors was 21.3.

45. We have also found from the judgment of the High Court that
the contractors had billed for those poles only which were of 20 feet and
above. This is admitted by Shri Handoo and is apparent from the bills
F subn1itted by the carriers \vhich are on record. To bring hon1c this point,
it would be enough to refer lo the bill of Arfa Electrical Company which
is at page 286 of Volume XII. The total number of poles for which bill was
submitted comes to 822, of which 647 were between 20 feel to 26 feet and
the remaining 175 between 27 to 30. In all, however, the contractor had
G carried ll25 poles, as mentioned at page 75 of the High Court's judgment.
There is no dispute that sin1ilar· is the situation as regards the two other
earners.

46. It thus appears that though these three appellants had sought to
assist the carriers to cause wrongful gain to them by allowing transportation
H of poles below 20 feet, ultimately M tinancial loss on this count was caused
(

G.D. BUCHv. STATE [HANSARIA,J.] 1145

to the State because the carriers had not been paid for poles carried by A
them which were below 20 feet. We are, therefore, of the view that these
appellants also deserve to be acquitted, as were some of the Field Officers,
who had accepted the under-sized pole at the receiving point had been
acquitted by the High Court. May it be mentioned that the.High Court had
acquitted the Field Officers mainly because of acquittal of the supplier, B
namely, Mustaq & Company, by the trial court against'which no appeal
had been filed. The High Court observed that if no offence had been
committed by the supplier on this score, the persons who had received
those poles cannot be faulted with. We would say the same qua these three
appellants.

47. Criminal Appeal Nos. 522, 528 and 529 of 1981 are, therefore,
c
allowed by setting aside the convi.ction of the appellants and by ordering
their acquittal.

Appellants Hafeezullah and FA. Qurashi
(Criminal Appeal Nos. 524 and 525 of 1981) D
48. These are the contractors who had been approached by Buch and
had started transporation work from 18.9.77 - the date of the issuance of
.l
the NIT being 17.9.77. Appellant Qurashi had executed the work from 18th
for 6 days and had transported 1038 poles. Appellant Hafizullah started
transportation work from 24th September and this continued till 29th, E
during which period 1125 poles were carried.

49. Shri Jethmalani, learned senior counsel appearing for these ap-
pellants, contended that there were some legal infirmities in their convic-
) tion. He first stated in this regard that the charges framed against them F
being one of conspiracy with accused 5 and 6 (who are appellants Salaria
and Buch) and through them with accused 1 to 4 (who were the Power
Dc;velopn1cnt Commissioner, the Chief Engineer, the Superintendent En-
gineer and Technical PA to the Power Development Officer), and accused
1 to 4 having been acquitted, the charge of conspiracy against these
appellants has to fail on this count alone. Further leaf of this argument was G
that there being no charge of conspiracy inter-se among the three contract
carriers, even if there was some conspiracy between accused Rashid Khan
and P. Gulam Nabi, who were the partners of the firm of Khan Electric
and General Stores, no illegal act at all was committed by these appellants,
as after all what they had agreed to do was to transport poles at the rate H
)

1146 SUPREME COURT REPORTS [1996] 3 S.C.R.

A to be found lowest on tender being floated. It was also contended that there
was wrong use of section 10 of the Evidence Act because there is no
evidence alliunde about these appellants having "conspired together" with
others in which case alone section 10 becomes operative. Final !law men-
tioned was Lhat the circumstances \Vhich had co111c on record against these
appellants had not been put lo them in their examination under section 313
B Cr.P.C., because of which the circumstances have to be excluded from
consideration, as held by this Court in Sharad Birdhichand v. State of
Maharashtra, [1984 J 4 SCC 116.

50. It is no doubt correct that accused 1 to 4 were acquitted but
C accused 5 and 6 were not; and we loo have upheld their conviction. Though
the charge stated about ultimate conspiracy with accused 1 to 4, the same
was alleged through accused 5 and 6. We have already dealt as to what is
the effect of acquittal of accused I to 4 on the charge of conspiracy, and
it has been pointed out that the acquittal did not affect the inner circle of
the conspiracy which remained intact inasmuch as appellants Salaria and
D Buch are comprehended in that circles.

51. As to there having been no charge of conspiracy inter-se between
the three contractors, the same is not material because of our finding that
there was close inter-relationship between the three firms and all of them
E had acted in concert. The submission about non-applicability of section 10
of the Evidence Act, therefore, fails. So, it is not necessary to advert to
what was held in this regard· in Natwarial Sakar/a/ v. State of Bombay,
(1963) Bombay Law Reporter 660 to which we were referred by Shri
Jethmalani to support his submission relating to section 10 of the Evidence
Act.
F
52. This leaves for consideration the submission that the circumstan-
ces coming on record were not put to the appellants when they were
examined under section 313 Cr.P.C. for which reason the circumstances
have to be excluded from consideration. In support of this submission Shri
G Jethmalani read out to us the questions asked to Hafeezullah, which
(alongwith his answers) are at page 283 of Volume II and read as below:

"QI It has transpired in evidence that without having anything
to do with Arfa Electrical Co. Red-Cross-Srinagar you have sub-
mitted a bill for Arfa Electrical Co., which was originally shown
H to be a bill on behalf of Khan Electrical and General Stores ?
G.D. BUCHv. STATE [HANSARIA,J.] 1147

Al I am a partner of Arfa with one Farooq Ahmed Zargar. The A
bill was given for typing and the typist committed a mistake, which
was corrected by hand. The bill was due because of the arrange-
ment made by me and my partner with ECO Leh on 8.9.77

01 Further that Farooq Ahmed Qurashi SIO your Father's
Brother-in-Law had submitted quotation in response to NIT issued B
by Xen. ECO Leh as proprietor of Arfa Elec. Co. with which you
had no connections ?

Al That is not correct. That quotation Ex PW 3110 which I have
seen today was signed by me partner Farooq Ahmed Zargar C
Ahmed and bears the signature of said Farooqi Ahmed Zagar and
not of F arooq Ahmed Qureshi.

Q/ Why you are being prosecuted ?

Al I do not know.
D
QI Why the witness are deposing against you ?

Al No witness has deposed anything against me.

QI Would you like to lead (sic, make) any other submission?
E
Al I am innocent.

QI Would you like to lead any defence ?

Al Yes. 11
) F
53. The aforesaid does show that Hafeezullah was not asked, in any
form, about his having entered into conspiracy with anybody. He was not
even asked that the rates at which poles were carried by him were un-
reasonable or high. As these allegations/circumstances are the crux of the
prosecution case insofar as he is concerned, the non-providing of oppor- G
!unity to him to explain the same has rendered his conviction unsustainable.
We,Jherefore, accept his appeal and order for his acquittal.

54. Insofar as appellant Qurashi is concerned, a perusal of his
examination under 313 (at pages 280 to 282 of Vol. II), however, shows
that the facts which emerged against him were put to him to enable him H
1148 SUPREME COURT REPORTS [1996] 3 S.C.R.

A to explain the same. The law, therefore, would not require us to exclude
the circum;lances brought on record against him. His conviction, therefore,
has to be sustained as we are satisfied about his complicity. But then,
keeping in view the sentence whicl: we have awarded on the principal
accused, namely Salaria and Buch, we would reduce his sentence to RI for
one month. Fine of Rs. 20,000 as awarded by the High Court is left
B unchanged. In default of payment of fine, the appellant would suffer
imprisonment for two months.

55. Criminal Appeal No. 524/81 is, therefore, allowed. But Criminal
Appeal No. 525/81 is dismissed, subject to the aforesaid modification in
C sentence.

Appe/la11ts A.R. Kha11 a11d P. Gu/am Nabi
(Criminal Appeal No. 527 of 1981)

56. These appellants are the partners of Khan Electrical and Genernl
D Stores. It is this furn whose tender being the lowest was accepted on
27.9.1977 in the wake of issuance of NIT on 17.9.1977.

57. In view of all that has been stated above there is nothing to doubt
about their involvement in the matter. Shri Thakur, appearing for these
E appeltants also, made no independent submission relating to them. All that
he had urged was to bring out our notice the circumstances nnder which
their firm was given the contract and how the contract having been given
at the lowest tendered rates was not tainted. We have expressed our
opinion on these submissions while dealing with the case of Salaria and
Buch. We may not repeat the same. We may only point out that from what
F has been stated above we are satisfied that the contract given to the firm
of these appellants was as per pre-arranged plan and the same was given
to enable them to earn extra profit for appropriate sharing afterwards.

58. We are, therefore, satisfied that they were rightly found guilty
both by the trial court and the High Court. As to their substantive sentence,
G we would reduce the same to RI for one month keeping in view the
sentence we have awarded on appellants Salaria and Buch, and what we
have done regarding the sentence of appellants Kantroo and Razdan. We
would, however, leave the sentence of fine as awarded which is a sum of
Rs. 20,000 on each unaltered. In default of payment of fine, each of them
H would suffer imprisonment for two months.
G.D. BUCHv. STATE [HANSARIA,l.J 1149

59. Criminal Appeal No. 527/81 is, therefore, dismissed, subject to A
the aforesaid modification in sentence.

Conclusions

60. We may sum up our conclusions. These arc :
B
(1) Conviction of appellants N.A. Salaria and G.D. Buch is upheld.
Their substantive sentence is, however, reduced to RI for two months. Fine
of Rs. 15,000 as awarded by the High Court, is left unaltered. In default of
payment of fine, each of these appellants would undergo imprisonment for
two months.
c
(2) Conviction of appellants T.K. Kantroo and V.K. Rajdan has been
confirmed. Their substantive sentence has, however, been reduced to RI
for one month. Fine of Rs. 3,000 as awarded by the High Court is left
unaltered. In default of payment of fine, each of the appellants wonld
undergo imprisonment for one month. D
(3) Conviction of appellants H.L. Dhar, F.A. Zadoo and Mohd.
Siddiq has been set aside and they have heen acquitted.

(4) Conviction of appellant Hafeezullah has been set aside and he
too stands acquitted. E
(5) Conviction of appellant F.A. Qurashi is Confirmed. His substan-
tive sentence has, however, been reduced to RI for one month. Fine of Rs.
20,000 as awarded by the High Court is left unaltered. In default of
payment of fine, this appellant would suffer imprisonment for two months.
F
(6) Conviction of appellants AR. Khan and P. Gulam Nabi has been
confirmed. Their substantive sentence has however, been reduced to RI for
one month. Fine of Rs. 20,000 as awarded by the High Court is left
unaltered. In default of payment of fine, each of the appellants would suffer
imprisonment for two months. /

Col. V.S.S. Appeal disposed of.

' j