In a recent judgment, the Supreme Court of India recently quashed a First Information Report ( FIR ) lodged against a former Excise Commissioner accused of possessing disproportionate assets from 1996 to 2020.
The Appellant, former Assistant Excise Commissioner was subject to an open inquiry by the Uttar Pradesh Vigilance Establishment which revealed his amassing of assets worth ₹1,16,02,669, exceeding his possible known income by ₹21,74,064, deeming the same to be disproportionate assets.
Subsequently, the Vigilance Department directed the institution of criminal proceedings against the Appellant, against which the disputed FIR under Section 13(1)(b) read with Section 13(2) of the Prevention of Corruption Act, 1988.
Following issuance of Notice, the Appellant declared his total income from 1996 to 2020 to be ₹75,73,676 while that of his wife was ₹41,67,592. Additionally, the Appellant contended sale of ornaments, Life Insurance payout and money received from his father, resulting in a total income of ₹1,21,06,268 from 1996 to 2020.
Vinod Kumar Tewari, appearing for the Appellant argued that the FIR relied on outdated metrics for calculating disproportionate assets and that the Authorities failed to consider the economic changes that occurred in India including increased per capita income, higher inflation rates, and evolving investment opportunities.
Meanwhile Ruchira Goel representing the State upheld the actions of the authorities and contended that the Appellant had failed to adequately explain his source of income over the years.
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A Bench of Justice Vikram Nath and Justice Prasanna B. Varale observed that both the Appellant and his wife had duly filed their income tax returns, amounting to a total of ₹1,21,06,268 which is higher than the alleged disproportionate assets which amounted to ₹1,16,02,669 only.
Furthermore, the Bench observed that the period between 1996 to 2020 brings with it inflation and an obvious natural progression of change in the economy, affecting value of property, bringing about discrepancies in the declared value of assets.
Observing that in such cases, the amounts under scrutiny cannot be assessed in a mechanical manner, the Supreme Court called for the application of a certain margin while making such assessment owing to invariable economic fluctuations.
Referring to the decision in State of Haryana vs. Bhajan Lal (1992), the Court observed that when no offence is made out against the accused in terms of the FIR, the same deserves to be quashed and set aside.
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