SC Observation on 21 year old DA Case

Mushrooming of 50 bank accounts of late J Jayalalithaa and VK Sasikala between 1991 and 1995 was to utilise the transfer of their huge unaccounted money, the Supreme Court said, giving credence to the trial court findings.  The apex court, which convicted Sasikala and two of her relatives in the disproportionate assets case, referred to the trial court findings and said it had “held the view that the respondents in the case in hand had failed to offer any satisfactory explanation with regard to the enormous unexplained credit/accumulations in their bank accounts”. The bench said in its judgement that trial court had noted that at the commencement of the check period, there were “hardly 10 to 12 bank accounts standing in the names of Jayalalithaa and Sasikala, but thereafter 50 accounts mushroomed during the check period”. It said that deposits and withdrawals represented through different entries in the accounts suggest multiplication of transactions “stemming from the same corpus”. It noted that about 50 banks accounts were opened in the names of accused persons and the companies. “According to the Trial Court, the overall evidence as considered by it disclosed that the business activities in the names of Sasikala and her two relatives started only during the check period and that they did not invest any funds on their own for that purpose and in fact utilised these as a front to enable Jayalalithaa and Sasikala transfer huge unaccounted money through the bank accounts thereof,” it said.

The Supreme Court on Tuesday restored a trial court direction to confiscate properties allegedly registered in the name of six firms, following the conviction of AIADMK General Secretary VK Sasikala and others in the disproportionate assets case. It refused to concur with the submission buttressed by the companies that their properties cannot be forfeited without hearing them, as they have not been arrayed as accused. “Having regard to the frame and content of the(Prevention of Corruption) Act and the limited modifications to the provisions of the CrPC, in their applicability as occasioned thereby and the authorisation of the special Judge trying the offences thereunder to exercise all the powers and functions invocable by a District Judge under the Ordinance, we are of the opinion that the order of confiscation/ forfeiture of the properties standing in the name of six companies, as involved, made by the Trial Court is unexceptionable. The firms, which found mention in the trial court records, are Lex Property Development, Meadow Agro Farms Ltd, Riverway Agro Products Pvt Ltd, Ramraj Agro Mills Ltd, Signora Business Enterprises Pvt Ltd and Indo Doha Chemicals and Pharmaceuticals Pvt Ltd. These companies claimed that they are lawful owners of some of the properties which have found mention in the list of assets in the case. “The decisions cited on behalf of the respondents (Sasikala and others) on this issue, are distinguishable on facts and are of no avail to them,” the apex court said.

Cash and gifts to the tune of Rs 2.15 crore received by late Chief Minister J Jayalalithaa on her birthday cannot be considered lawful income, the Supreme Court said. The apex court concurred with the findings of the trial court rejecting Jayalalithaa’s plea that an amount of Rs 2.15 crore and foreign remittance worth Rs 77.52 lakh were received by her as birthday gifts in 1992 which should be considered as her lawful income. These gifts were in the form of jewellery, cash, demand draft, silver items, silk sarees and framed portraits on the occasion of her birthday, the court noted. “In view of the incorporation of Sections 161 to 165A IPC in their letter and spirit in Prevention of Corruption Act 1988, gifts as claimed to have been made were not only prohibited by law, but also constitute an offence thereunder. By no means, therefore, the gifts in any form, as offered to Jayalalithaa during the relevant period, can be construed, as a lawful source of income,” it said. While agreeing with the prosecution that the gifts did not constitute a lawful source of income under the PC Act, it did not agree with the findings of the Karnataka High Court which had quantified the amount of gifts to be Rs 1.5 crore, principally referring to the income tax returns and the orders of the authorities passed thereon.