-
by Admin
14 December 2025 5:24 PM
“Where Demand Is Not Proved, Presumption Under Section 20 Cannot Be Invoked”: Allahabad High Court, Lucknow Bench overturned the conviction of a bank manager in a CBI trap case, emphasizing that demand of illegal gratification is the foundational requirement under Section 7 of the Prevention of Corruption Act, 1988. The Court held that “mere recovery of currency notes from an accused is not sufficient to bring home the charge under Section 7” and acquitted the appellant for lack of direct or credible evidence of demand.
Justice Subhash Vidyarthi, who authored the judgment, ruled that in the absence of proof of demand, no presumption under Section 20 of the PC Act could be drawn, thereby invalidating the trial court's conviction which was based solely on recovery of the money.
Bribery Allegation in Issuance of No-Dues Certificate
The case stemmed from an FIR registered by the CBI on October 16, 2008, alleging that Mohd. Saleem Khan, then Branch Manager of Sarva U.P. Gramin Bank, had demanded a bribe of ₹3,000 for issuing a no-dues certificate in connection with a waived-off Kisan Credit Card (KCC) loan of ₹40,000. A trap was laid the following day, and ₹2,500 was allegedly recovered from a passbook kept in the drawer of the appellant’s desk.
However, during the trial, the complainant (PW-1) and the shadow witness (PW-2) turned hostile. The complainant asserted that CBI officials had dictated the complaint and instructed him to hide the currency notes in the passbook, thereby casting doubt on the integrity of the trap.
“Demand of Illegal Gratification Is Sine Qua Non for Conviction Under Section 7”
Reiterating well-established principles of law, the Court quoted extensively from Supreme Court precedents to stress that "the demand of illegal gratification is sine qua non for constituting an offence under Section 7 of the PC Act."
Justice Vidyarthi cited B. Jayaraj v. State of A.P., (2014) 13 SCC 55, where it was categorically held:
“Mere recovery of currency notes cannot constitute the offence under Section 7 unless it is proved beyond all reasonable doubt that the accused voluntarily accepted the money knowing it to be a bribe.”
The Court further relied on the Constitution Bench ruling in Neeraj Dutta v. State (NCT of Delhi), (2023) 4 SCC 731, and summarized:
“Presumption under Section 20 can only arise when foundational facts, including the proof of demand and acceptance, are established. In their absence, the presumption cannot be invoked.”
In the present case, the Court found no credible evidence proving that the appellant demanded any bribe, and thus, ruled that “the conviction under Section 7 is unsustainable in law.”
Hostile Complainant and Contradictory Trap Evidence Undermine Prosecution’s Case
The Court noted that both PW-1 (complainant) and PW-2 (shadow witness) deviated from their earlier statements and categorically denied hearing or witnessing any demand. PW-1 stated on oath:
“I was made to write the complaint under dictation by CBI officials… I was asked to hide the money in the passbook and hand it over or place it near the appellant… the appellant never demanded any money.”
PW-2, while confirming the act of handing over the passbook, admitted he did not hear any conversation between the complainant and the appellant, thereby failing to corroborate the alleged demand.
The Court held: “The testimony of the complainant and shadow witness, read in entirety, does not inspire confidence. The prosecution has failed to discharge the burden of proving demand and acceptance beyond reasonable doubt.”
Failure to Examine Key Witness Leads to Adverse Presumption Against CBI
The Court invoked Section 114(g) of the Indian Evidence Act, 1872, which allows a presumption that evidence not produced would be unfavourable to the party withholding it, and faulted the CBI for not producing Jagdish Singh—a material witness whose statement was recorded during investigation.
The Court observed:
“Non-examination of a witness, who could have shed light on the events inside the cabin, particularly when five to six persons were admittedly present, gives rise to an adverse inference against the prosecution.”
Notably, Jagdish Singh later appeared as DW-4 and testified that he never made the statement attributed to him by the Investigating Officer, strengthening the claim that CBI officials fabricated or manipulated the evidence.
Defence Testimonies Highlight CBI’s Alleged Misconduct During Trap
The Court found credible and consistent testimonies from defence witnesses (DW-5 and DW-7) who were allegedly present in the cabin during the trap operation.
DW-5, a woman running a self-help group, deposed:
“The complainant quietly placed the passbook and left… 4-5 CBI officers then barged in and forcibly tried to insert the passbook into the appellant’s pocket… when we protested, they started beating the appellant and threatened us with false implication.”
The Court noted that “the defence version casts serious doubts on the fairness and legality of the trap”, especially when the prosecution failed to counter these accounts effectively.
Trial Court Erred in Convicting Despite Absence of Demand Proof
While the trial court acquitted the appellant under Section 13(1)(d) read with Section 13(2), it convicted him under Section 7 solely based on recovery. The High Court found this untenable:
“Recovery without proof of demand and acceptance cannot sustain a conviction. The trial court’s finding is directly contrary to binding precedent and legal principles governing corruption trials.”
Conviction Set Aside, Fine to Be Refunded
Justice Vidyarthi concluded: “The prosecution has failed to prove the guilt of the appellant. The impugned judgment convicting and sentencing the appellant under Section 7 of the Prevention of Corruption Act is unsustainable and is accordingly set aside.”
The appellant was acquitted and the Court directed that the fine amount be refunded within 30 days.
Date of Decision: July 1, 2025
