IN THE HIGH COURT OF JUDICATURE AT MADRAS

Reserved on     :12.07.2023

Pronounced on     :21.07.2023

Coram:

THE HONOURABLE DR.JUSTICE G.JAYACHANDRAN

Criminal Appeal No.390 of 2022

1.Angayarkanni

2.Haripradeep

3.Haripriya        .. Appellants/Petitions

/versus/

State Represented by

Deputy Superintendent of Police,

Vigilance and Anti Corruption Wing,

Thiruvarur.        .. Respondent/Respondent

Prayer: Criminal Appeal has been filed under Section 454 of Cr.P.C., against the order dated 28.09.2021 passed by the Chief Judicial Magistrate Court, Thiruvarur, dismissing Crl.M.P.No.150/2021 seeking for return of the properties viz., documents and cash seized in Crime No.7 of 2020 on the file of the Deputy Superintendent of Police, Vigilance and Anti Corruption Wing,Thiruvarur.

For Appellants    :Mr.R.D.Ashok Kumar for

Mr.K.V.Shanmuganathan

For Respondent         :Mr.S.Udaya Kumar

Govt.Advocate (Crl.Side)

——

J U D G M E N T

The Criminal Appeal is directed against the dismissal order dated

28.09.2021 passed by the Chief Judicial Magistrate, Thiruvarur, in the Criminal

Miscellaneous Petition No.150 of 2021 filed under Section 451 of the Criminal Procedure Code.

2. The below question which is very serious and important in the present day context has arose in this appeal.

Whether the properties seized from a public servant during the search operation by the Vigilance Wing of the Police be returned to the legal heirs of the public servant,  if he dies pending investigation?

3.The facts leading to this appeal in short is:-

On 10.12.2020, Thiru.Dhanaraj, District Environmental Engineer in

Tamil Nadu Pollution Control Board, was arrested for demand and receipt of Rs.40,000/-  as illegal gratification from a Rice Mill owner to renew the license.

Subsequently, as follow up action on 11.12.2020, search of his house at

Urapakkam was conducted, which resulted in recovery of Rs.56,66,000/- (interestingly out of which, Rs.2,66,500/- were currencies of denomination of Rs.500/- and Rs.1000/- which were declared as invalid legal tender under the demonetization). Besides cash, incriminating documents and movables including gold jewels were found in his residence and there were inventorised by the police and copy given to the accused. Dhanaraj the accused got bail from the High Court vide order dated 18.01.2021, however pending investigation in Crime No.7 of 2020, he died on 07.05.2021. The appellants who are the wife and children of the deceased Dhanaraj filed petition before the Chief Judicial Magistrate, Thiruvarur, under Section 451 of Cr.P.C for return of the documents, gold jewels and cash seized from the house of the accused on 11.12.2020.

4. The State filed counter opposing the petition stating that during the lifetime of the accused, neither Dhanaraj nor the petitioners were able to satisfactorily account for the cash seized. Further, they did not seize any gold jewels as alleged in the petition. After taking inventory the gold jewels of various description weighing about 490 grams was returned to the 2^nd petitioner, Haripradeep, S/o Dhanraj. Till his lifetime, Dhanraj did not seek for custody of the cash seized from him. Till date the petitioners only say that the money was mobilised by Dhanaraj for constructing a Hospital for his daughter, Haripriya(3^rd petitioner) but not produce any record to support this claim. The claim of Haripriya is that she and her husband entrusted cash of Rs.9,50,000/- to her father Dhanaraj. This claim also not supported by any documents. Hence, the money has to be confiscated to the State as unclaimed money.
5. The trial Court, after considering the objection and the law governing for return of property seized by the police during investigation, dismissed the petition holding that without the proof of ownership, the petitioners are not entitled to get the money back. Further, he also observed that decision regarding the disposal of the property will be taken after the Police file the Final Report.

 

6. Against the above order, the petitioners have filed Criminal Appeal which was not taken on file initially since the Registry had an objection whether appeal will lie against the dismissal order of the petition filed under Section 451 of Cr.P.C., (Petition for interim custody of the property). The papers returned were represented by the petitioners with endorsement saying, the petition filed under Section 451 of Cr.P.C.,  has to be treated as petition under Section 452 of Cr.P.C, since it is deemed to be the final order in view of the demise of the accused.
7. This Court being satisfied with the above reason, directed the Registry to number the appeal. Thus, Crl.A.No.390 of 2022 has been taken on file and under consideration.
8. The learned counsel appearing for the appellants relying strongly on the judgments of this Court and the Hon’ble Supreme Court submitted that on the demise of the accused pending investigation, the properties seized cannot be retained by the Investigating Officer. According to the learned counsel for the appellants, the trial Court has failed to appreciate that the entire criminal proceedings initiated against the deceased Dhanraj, the husband of the first appellant and father of the appellants 2 and 3, for the alleged offence under Section 7 of Prevention of Corruption Act, 1988 as amended in 2018 had abated with his death. Therefore, the appellants are entitled to get back the properties seized from their residence in the trap case. The trial Court was not right in dismissing the application filed by the appellants, seeking for return of the properties seized from their residence, on the ground that they have failed to demonstrate that the properties seized on 11.12.2020 owned by them. The trial Court has failed to appreciate that, no case against the deceased Dhanaraj was registered for possession of disproportionate assets. To say that the deceased Dhanaraj acquired properties seized in the above case from unknown source of income, at least a case for disproportionate assets should have been registered.
9. The learned counsel further submitted that the trial Court has failed to appreciate that the respondent police had not sought for any explanation from the sole accused in Crime No.7 of 2020, the deceased Dhanaraj, till his demise regarding the properties seized from the residence of the appellants herein. No case registered against him or family members when Dhanaraj was alive. The trial Court has failed to bear in mind the distinction between unaccounted wealth and illgotten wealth. Absolutely, no material  produced by the respondent herein before the trial Court to show that, the deceased Dhanraj had acquired the properties found in the residence of the appellants by abusing his office.
10. The Deputy Superintendent of Police, Vigilance and Anti-Corruption

has filed counter wherein it is stated that the unaccounted cash including the demonetised money seized during the search of the deceased public servant  house deposited in the Court. Till his life time, the accused never claimed back the money either as owner of the money or custodian of that money.  100 numbers of Rs.1000/- denomination and 333 numbers of Rs.500/- denomination which were declared invalid legal tender long ago was found in his house along with valid currencies to a tune about Rs.56 lakhs.  Till date there is no account from the petitioners for the source of this money. Therefore, the suspicion of the police that those money are ill-gotten money is well fortified.

11. On completion of investigation, the Police has arrived at a conclusion that on the death of the sole accused Dhanraj in Crime No.7 of 2020 for receiving bribe  of Rs.40,000/- may abate but the money not accounted by the deceased to be confiscated to state under Section 458 of Cr.P.C.
12. According to the Government Advocate(Crl.Side), the prosecution for the act of crime may die with the person who committed the crime but the proceeds of the crime will remain and under Chapter IV-A of PC Act, the crime proceeds to be dealt independently. Abatement of the case due to the death of the offender by no stretch of imagination will make the ill-gotten money or property, legal for the heirs to inherit. The trial Judge by the impugned order has not foreclosed the right of the petitioners but had only deferred it till the decision on the final report is taken.
13. Section 458 of Cr.P.C., provides procedure to deal with properties seized during investigation. Without following the said procedure and satisfaction about the claim of ownership, the property seized during search cannot be returned to the petitioners under Section 451 or 452 of Cr.P.C.
14. Heard the learned counsel appearing for the appellants and the learned

Government Advocate (Crl.Side) for State. Perused the records.

15. The Final Report in Crime No.7 of 2020 filed before the Court on 23.06.2022 is yet to be taken on file by the trial Court. Meanwhile, the appeal which is subject matter of this appeal has been filed.
16. In the Final Report, the Investigating Officer after narrating the historyof the case and the death of the accused, has concluded as below:-

“4.It is further submitted that during investigation, the accused has not produced any document to account for the huge amount of cash seized during the search.  If the cash seized from the residence of accused is a legitimate amount, he would definitely filed petition before the Hon’ble Court requesting return of the huge cash seized during the house search. But, while he was live, the accused Tr.V.Dhanaraj has not filed any petition before the Hon’ble Court requesting return of cash seized during the house search. It clearly shows that the huge amount of cash seized during the house search is ill-gotten money. Further, seizure of demonetized cash of Rs.2,66,500/-(100 numbers of 1000 rupee notes and  333 numbers of 500 rupee notes) at the house at Chennai strengthen the conclusion that the huge amount seized during the house search is ill-gotten money.

5.It is further submitted that when examined, Tmt.D.Angayarkanni, wife of the accused stated that the amount seized from the house at Chennai was the amount mobilized by her husband for purchasing suitable land at Chennai to construct a clinic in future for their daughter, that the seized amount consist of amount given by her daughter, amounts received by loan from friends and relatives of her husband, and that she did not know the names of the persons from whom her husband received loan. Further, she stated that she has no idea about the demonetized cash seized at Chennai and unaccounted cash seized at Nagapattinam. When examined, Tmt.D.Haripriya, daughter of the accused stated that the total amount seized from the house at Chennai contains a total amount of Rs.9,50,000/- given by her and  her husband to her father to purchase a land at Chennai to construct a clinic in future for her and that she has no idea about the demonetised cash seized at Chennai. But, Tmt.D.Haripriya did not produce any supportive evidence for her claim that the seized amounts contains Rs.9,50,000/- given by her and her husband to her father.  When examined, Tr.D.Haripradeep, son of the accused also stated the same version of his mother regarding the unaccounted cash and demonetised cash seized during the house search.

6.It is further submitted that during examination, the legal heris of the accused did not give any satisfactory explanation to show that the unaccounted  cash seized during house search was legally acquired by them or by the accused Further, during the investigation, the accused or the legal heirs of the accused have not produced any document or income Tax returns to show that the circumstances which warrants the accused used for the possession of such a huge amount of cash in his residence at the relevant period and that the cash was received from a lawful source. Hence, for the aforesaid reasons, the unaccounted cash and demonetized cash  seized to be confiscated to the State Government u/s 458 (1) Cr.P.C.”

17. As far as the properties involved in criminal cases, Chapter XXXIV of the Criminal Procedure Code deals how the property to be disposed.
18. In this case, the appellants have approached the trial Court by filing a petition under Section 451 of Cr.P.C., a provision meant for custody and disposal of the property, pending trial in certain cases. The oft quoted judgment under this Section is the judgment of the Hon’ble Supreme Court rendered in Sunderlal

Ambala Desai and Ors. v. State of Gujarat in [(2002) 10 SC 283], in which the Hon’ble Supreme Court has laid down the directions for return of the property pending trial.  Next, provision is Section 452 of Cr.P.C., which deals with order for disposal of property at conclusion of trial.

19. As stated earlier, though the petitioners have approached the trial Court for return of the properties under Section 451 of Cr.P.C., after dismissal of their petition, they have requested the High Court to consider their petition under

Section 452  Cr.P.C, since on filing the Final Report by the Investigating Agency, the matter has reached finality.  This Court has also accepted the said plea and had taken it as a petition for return of property in a concluded trial.

20. A peculiar fact in this case is that in Crime No.7 of 2020, the respondent police has seized cash of Rs.40,000/- which alleged to have been received by the deceased public servant as illegal gratification. According to the prosecution, this money belongs to the defacto complainant Thiru.Duraisamy, the owner of the Rice Mill by name, Nivedha Rice Mill, Vilamal Main Road, Thiruvarur. As far as  the possession as well as the source of the possession of Rs.40,000/- is concerned, the prosecution has clear information and material evidence. Whereas Rs.56,61,000/- seized under the mahazar during the search of the residence of Dhanraj at S1, Block A, Marutham Royal Wood, Chitragupta Nagar, Revathipuram Main Road, Urappakkam, Chennai, along with demonetised cash of face value Rs.2,66,500/- is concerned, on suspicion, it has been seized.  It is to be noted that so far this currency is concerned, till the death of the public servant on 07.05.2021, the prosecution has not registered any case for disproportionate asset. It is also to be noted that, the public servant during his lifetime had not sought for return of this property claiming ownership. Equally, the petitioners independently also did not claim the ownership over the property till filing of the petition in Crl.M.P.No.150 of 2021 on 13.08.2021. This is much after the death of the public servant. The respondent had filed the final report on 23.06.2022 and the said final report yet to be taken on file.
21. Now reverting back to the legal position, in a case where the property seized by the police officer not produced before the Criminal Court during enquiry or trial, but reported to the Magistrate. The Magistrate may make such order as he thinks fit for the disposal of such property in exercise of power under Section 452 of Cr.P.C.   In this case, the money seized has been reported to the Magistrate as well as been deposited in the Court. The Final Report been filed before the trial Court on 23.06.2022 but yet to be taken on file by the Magistrate to pass appropriate order.
22. In the final Report, the Investigating Agency has rightly stated that the money seized to be dealt as per the procedure contemplated under the Code in Section 458 of Cr.P.C. The reason is very obvious.  Till filing of the Final Report there was no claimant about this property seized.  The petition filed for return of property does not disclosed the ownership except a bald claim that Rs.9,50,000/belongs to the second petitioner and rest of the money were kept by the deceased accused which was borrowed from the other source. There is no material evidence to prove the ownership.  The money seized is not the property  of the deceased to be inherited by the legal heirs of the deceased.  It is tainted property which has been seized on suspicion. No sufficient explanation for the source of the money is given.  Till date, the status of the currency seized remains unchanged. On the death of the public servant, the status of the money seized will not get changed.
23. Cases of this nature encompasses two distinct offences. One is the accumulation of wealth through unknown source. This offence is attributable to the individual who has accumulated the wealth and any action on this offence die with the person. Another is the property itself. The property so accumulated which is looked as proceeds of crime will not die on the death of  the person, who alleged to have committed the crime, when it is prima facie satisfied that it is illgotten money of the deceased person. In such cases, it is necessary for the person, who claims the seized money to prove the ownership.
24. In this case, till date except a bald claim over the portion of the money,there is no material placed by the petitioners to establish their ownership. Unless they are able to show that the money was legally acquired by them and entrusted to the deceased public servant, the money cannot be returned to them on the basis of their inheritance. It is also to be noted that the petitioners have made a wrong claim over the gold jewels which has already been returned to the second petitioner who has signed the inventory list. Despite that, in this petition, they have also included the gold jewels, which is nothing but a wrong statement.
25. The learned counsel appearing for the petitioners relied upon an unreported judgment of Andrapradesh High Court in Peethalanagamani v. The State of Andra Pradesh in Crl.A.No.153 of 2022, dated 29.08.2022, wherein the money seized during the search of the public servant residence kept in Court deposit was ordered to be returned to his legal heirs in view of the fact case the abated on the death of the public servant. Going through the said judgment rendered by the Hon’ble Mr.Justice Ravi Cheemalapati, this Court finds that though there are many similarity on facts between that case and the case in hand, the main difference in that case is that investigation was completed and when the application was filed for interim custody of the currency, the prosecution has said no objection, provided, the accused produce the money before the disciplinary authority as and when required. Therefore, the money invested in bank deposit when sought to be returned after the case in C.C.No.32 of 2018 dismissed as abated, Court allowed the petition. The facts are similar to this case. The public servant was caught red-handed while accepting the bribe of Rs.10,000/-. In the follow up action, his house was searched and  unaccounted money of Rs.2,10,000/- was recovered from his residence. No additional case for disproportionate asset was registered against him.  The case registered for receiving illegal gratification, investigated and final report was taken on file in C.C.No.32 of 2018.  At this stage, the application for return of property was allowed and the money seized was lying in the Court deposit, on the death of the public servant, the High Court ordered the money to be returned to the legal heirs of the public servant. Contrary to those facts, in the case in hand, the public servant during his lifetime did not make any claim over the property.  The respondent police has also serious objection to return the property.
26. The learned counsel appearing for the appellants relying upon the judgment of the Karnataka High Court rendered in Nirmala K.S v. State of Karnataka dated 20.09.2021 contended that Karnataka High Court has held in the Prevention of Corruption Act case, on the death of the public servant, the property attached, on the allegation that it was acquired by illegal means is liable to be returned back to the legal heirs of the public servant. In this judgment, Karnataka High Court being satisfied on facts that the gold and silver items seized from the house of the accused proved to be the property of the accused and there is no rival claimant ordered return of property to legal heirs.  Similar cases under the Criminal Law Amendment Act and Income Tax Act were cited by the learned counsel appearing for the petitioners. However, the facts of those cases are easily distinguishable to the facts of the case in hand. Whenever there is no rival claim or no doubt about the ownership, the Courts can order for return of property to the legal heirs of the deceased but the same principle cannot be applied  when there is rival claimant or no proof of ownership produced by the claimants.
27. The judgments relied by the learned counsel appearing for the appellants only indicates that in case of interim custody, Courts in exercise of Section 451 of Cr.P.C., return of property after ascertaining the suitability of the person to whom the custody is given. In all other cases, whether under Section 452 of Cr.P.C., or Section 457 of Cr.P.C, the ownership of the property has to be ascertained before returning the property to the claimant. No judgment says without satisfying the ownership the property, it must be given to the legal heirs on the death of the accused.
28. Under Chapter XXXIV of Cr.P.C., the procedure in respect of the property seized by the police is dealt under Sections 457 and 458 of Cr.P.C. The petitioners herein who have come forward to claim the property seized by the police had not produced evidence how they are entitled to the possession of that property. The ownership of the money seized under suspicion is to be proved through evidence by the claimant that it is not illgotten money, because the public servant shall be presumed to have intentionally enriched himself illicitly for being in possession of pecuniary resources or the property disproportionate to his known source of income which the public servant not satisfactorily accounted for. It is a rebuttable presumption.  In this case, the public servant Dhanaraj during his life time had not claimed the ownership of the property and his legal heirs able to prove their ownership will be entitled for the property but without proof of ownership the property seized cannot be returned to them.  To prove the ownership, it is necessary to undergo the procedures laid in Sections 457 and 458 of Cr.P.C.
29. For easy reference, Sections 451, 452, 457 and 458 of Cr.P.C extracted below:-
    451. Order for custody and disposal of property pending trial in certain cases- When any property is produced before any Criminal Court during any inquiry or trial, the Court may make such order as it thinks fit for the proper custody of such property pending the conclusion of the inquiry or trial, and, if the property is subject to speedy and natural decay, or if it is otherwise expedient so to do, the Court may, after recording such evidence as it thinks necessary, order it to be sold or otherwise disposed of. Explanation.- For the purposes of this section,” property” includes-

(a) property of any kind or document which is produced before the Court or which is in its custody.

(b)any property regarding which an offence appears to have been committed or which appears to have been used for the commission of any offence.

452. Order for disposal of property at conclusion of trial-(1) When an inquiry or trial in any Criminal Court is concluded, the Court may make such order as it thinks fit for the disposal, by destruction, confiscation or delivery to any person claiming to be entitle to possession thereof or otherwise, of any property or document produced before it or in its custody, or regarding which any offence appears to have been committed, or which has been used for the commission of any offence.

• An order may be made under sub- section (1) for the delivery of any property to any person claiming to be entitled to the possession thereof, without any condition or on condition that he executes a bond, with or without sureties, to the satisfaction of the Court, engaging to restore such property to the Court if the order made under sub- section (1) is modified or set aside on appeal or revision.
• A Court of Session may, instead of itself making an order under sub- section (1), direct the property to be delivered to the Chief Judicial Magistrate, who shall thereupon deal with it in the manner provided in sections 457, 458 and 459.
• Except where the property is livestock or is subject to speedy and natural decay, or where a bond has been executed in pursuance of subsection (2), an order made under sub- section (1) shall not be carried out for two months, or when an appeal is presented, until such appeal has been disposed of.
• In this section, the term” property” includes, in the case of property regarding which an offence appears to have been committed, not only such property as has been originally in the possession or under the control of any party, but also any property into or for which the same may have been converted or exchanged, and anything acquired by such conversion or exchange, whether immediately or otherwise.

457. Procedure by police upon seizure of property-(1) Whenever the seizure of property by any police officer is reported to a Magistrate under the provisions of this Code, and such property is not produced before a Criminal Court during an inquiry or trial, the Magistrate may make such order as he thinks fit respecting the disposal of such property or the delivery of such property to the person entitled to the possession thereof, or if such person cannot be ascertained, respecting the custody and production of such property.

(2) If the person so entitled is known, the Magistrate may order the property to be delivered to him on such conditions (if any) as the Magistrate thinks fit and if such person is unknown, the Magistrate may detain it and shall, in such case, issue a proclamation specifying the articles of which such property consists, and requiring any person who may have a claim thereto, to appear before him and establish his claim within six months from the date of such proclamation.

458. Procedure where no claimant appears within six months- (1) If no person within such period establishes his claim to such property, and if the person in whose possession such property was found is unable to show that it was legally acquired by him, the Magistrate may by order direct that such property shall be at the disposal of the State Government and may be sold by that Government and the proceeds of such sale shall be dealt with in such manner as may be prescribed.

(2) An appeal shall lie against any such order to the Court to which appeals ordinarily lie from convictions by the Magistrate.”

30. It is also to be taken in to account that under Chapter IV(A) of

Prevention of Corruption Act, 1988, Section 18A inserted by the amendment Act 16 of 2018 has come into effect on 26.07.2018. This Section empowers the State to confiscate the money or the property procured by means of an offence under the Prevention of Corruption Act, 1988. So the death of the public servant will not give any advantage to the appellants to get back the property without proving the ownership in the property. The Rule for public servant from whom the money seized will apply to the legal heirs, in case the public servant dies before conclusion of trial. The confiscation proceedings therefore, under Section 18A will still survive, though the prosecution under Section 7 of the Prevention of

Corruption Act, 1988 is not possible due to the death of the public servant.

31. In short, after a combined reading of Section 13 of the Prevention of

Corruption Act, 1988 and Sections 451,452,457 and 458 of Cr.P.C along with Evidene Act Section 114 illustration (a), this Court is of the view that, if the public servant is unable to account for the property in his possession, it is a situation akin to the illustration (a) in Section 114 of Indian Evidence Act, the Court may presume, the possession could not have been possible other than unlawful means. This presumption is a rebuttable presumption. The person, who claims ownership of the property seized by police, can prove the ownership and get back the property either under Section 452 or under Section 457 of Cr. P.C, as the case may be. If no body claims ownership or fails to prove it was acquired by him legally, then the property must be put at the disposal of the State in exercise of the power under Section 458 of the Code of Criminal Procedure.

32. The return of property in a criminal trial, based on the nature of the offence, the necessity of the property, whether it is corpus delicti or not? Whether its ownership is disputed or undisputed are some of the factors which will govern the decision on any application for return of property. In this case, neither Section 451 of Cr.P.C nor Section 452 of Cr.P.C will apply. The provision which is applicable to the facts of the case is Sections 457 or 458 of Cr.P.C. First the prosecution has to take a decision whether they want to proceed against the property under Section 18(A) for confiscation. If not otherwise, the ownership of the property must be ascertained by the trial Court on examining the claimants and decision must be taken regarding the return of the property.
33. In this case, the expectation of the petitioners that the property to be returned to them as a matter of right applying law of inheritance is not correct. To claim the property, they have to prove the ownership of the property. Unless they prove the ownership, they will not be entitled for the property back.
34. With this observation, this Criminal Appeal is dismissed. The order passed by the Chief Judicial Magistrate, Thiruvarur in Crl.M.P.No.150 of 2021 dated 28.09.2021 is herein confirmed.

21.07.2023

Index:yes speaking order/non speaking order

ari

To:

1.The Chief Judicial Magistrate Court, Tiruvarur.

2.The Deputy Superintendent of Police, Vigilance and Anti Corruption Wing, Thiruvarur.

3.The Public Prosecutor, High Court, Madras.

DR.G.JAYACHANDRAN,J.

ari

Delivery Judgment made in

Crl.A.No.390 of 2022

21.07.2023