PUBLIC PROSECUTOR Vs. KBHIMESWARA RAO

JUDGEMENT

(1.) This is an appeal against the acquittal of the accused in C.C. No. 55 of 1946 by the Sub-Divisional Magistrate, Ellore. He was charged with an offence under Section 420 of the Indian Penal Code for having dishonestly induced Kesaripalli Anjaneyulu, P.W. 1, and Umma Janardhana Rao, P.W. 2, to deliver to him Rs. 1,000.

(2.) The accused was an auditor employed by P. Ws. 1 and 2 who were merchants jointly conducting tobacco business at Ellore to audit the accounts of their firm, to prepare their income-tax return and to look after their income-tax affairs. He had been so employed by them for over fifteen years. They sent their income-tax return for the assessment year 1944-45 some time in August, 1944. The case for the prosecution is that after the accounts were prepared for income-tax purposes the accused represented to them that their income was such that they would become liable to Excess Profits Tax and he undertook to see that they escaped such assessment if Rs. 1,000 was given to him to be paid as a bribe to the Income-tax Officer. P.W.s 1 and 2 accordingly paid him Rs. 1,000 some time in January, 1945. Eventually there was an assessment order Exhibit D-1, dated 12th January, 1945 and by that order they were not assessed to any Excess Profits Tax. Months later, P.W. 2 met P.W. 3, the income-tax Officer, Ellore, who was the Income-tax Officer on the relevant dates, and after a conversation which related to private matters, P.W. 2 asked P.W. 3 if he was in receipt of Rs. 1,000 sent through his auditor in the previous year. P.W. 3 denied having received any money from the auditor. P.Ws. 1 and 2 then realised that they had been duped. P.W. 3 consulted his superior officers and on their advice he lay a trap to catch the accused.

(3.) On 22nd September, 1945, he kept his Inspector, personal clerk and others in a room adjacent to the hall in which he was seated and asked them to over-hear what passed in the hall. P.Ws. 1 and 2 and the accused came into the hall with the accounts. Then, as previously arranged, after a pretence of examining the accounts, P.W. 2 said that P.W. 3 may .finish the examination and that he would give him a bribe of Rs. 1000 as in the previous year. P.W. 3 asked him what it was about and P.W. 2 told him that the accused had taken from them Rs. 1,000 in the previous year stating that it would be given to the Income-tax Officer as a bribe. P.W. 3 then asked the accused about it. The accused replied that it was a matter between them and that it was nothing. P.W. 3 then informed the accused that the whole truth of the matter was known and that the accused. should immediately return the amount to them. The accused agreed. P.W. 2 brought an account book wherein an entry was made showing a cash payment of Rs. 1,000. This entry was signed by the accused. This entry really amounted to a repayment of Rs. 1,000 alleged to have been taken by the accused. The Income-tax Officer, P.W. 3 then recorded statements from the accused, the Inspector, his personal clerk and others and sent a report to the Assistant Commissioner. On 4 April, 1946, P.W. 3 was directed by the Commissioner of Income-tax to lodge a complaint against the accused before the Police ; and a complaint was filed accordingly.