N.E. Abraham v. State of Kerala

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.S.GOPINATHAN FRIDAY, THE 4TH MARCH 2011 / 13TH PHALGUNA 1932 CRL.A.No. 1112 of 2002() -----------------------CC.29/1997 of ENQUIRY COMMR. & SPL. JUDGE, TRIVANDRUM .................... APPELLANT/ACCUSED NO.1 -------------------------- N.E.ABRAHAM S/O. ITHAPPIRI, GOVERNMENT CONTRACTOR, NJATUKALAYIL HOUSE, KUNNATHUNADU, KADAYIRUPPU P.O., KOLENCHERRY BY ADV. SRI.P.VIJAYA BHANU, SENIOR ADVOCATE SRI.P.M.RAFIQ RESPONDENT/COMPLAINANT -------------------------- STATE OF KERALA, REPRESENTED BY PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM. PUBLIC PROSECUTOR SRI.I.V.PRAMOD THIS CRIMINAL APPEAL HAVING BEEN FINALLY HEARD ON 04/03/2011, THE COURT ON 04/03/2011 DELIVERED THE FOLLOWING: ## **P.S.GOPINATHAN, J. -------------------------------Crl.A. No.1112 OF 2002** ## **---------------------------------Dated this the 4[th] day of March, 2011** ## **J U D G M E N T ~~~~~~~~~~~** Appellant is the 1[st] accused in C.C.29/97 on the file of the Enquiry Commissioner Special Judge, Thiruvananthapuram. He was prosecuted along with late K.G.Ramachandran Nair (2[nd] accused), formerly Executive Engineer, Kallada Irrigation Project, RB Division No.5., Kollam alleging offences under Section 13(2) read with Section 13(1)(d) of the Prevention of Corruption Act, 1988 and Section 120B IPC. 2. The learned Judge, after trial, arrived at a finding of guilt. Consequently, the appellant was convicted and sentenced to undergo rigorous imprisonment for four years and a fine of Rs.4,00,000/- under Section 120B IPC with a default clause for non payment of fine. The 2[nd] accused was found guilty for offence under Sections 13(2) read with Section 13(1)(d) and 120B IPC. The 2[nd] accused was sentenced to rigorous imprisonment for four years and a fine of Rs.2,00,000/- under Section 120B IPC. For offence under Section 13(2) read with 13 (1)(d) of the Prevention of Corruption Act, the 2[nd] accused was Crl.Appeal No.1112/02 2 sentenced to rigorous imprisonment for four years and a fine of Rs. 2,00,000/- with default clause. Assailing the above conviction and sentence, the 1[st] accused has filed this appeal. The 2[nd] accused filed Crl.A.No.1110/2002. Pending appeal, the 2[nd] accused expired. The learned counsel for the appellant submitted that none of the legal heirs had come forward to implead in the appeal and to prosecute the appeal. On the basis of that submission, the other appeal was dismissed as abated. 3. PW18, the Deputy Superintendent of Police, Vigilance and Anti Corruption Bureau, Kollam on the basis of a report of preliminary enquiry registered a case as Crime No.9/96/VACB, Kollam by Ext.P20 First Information Report against late Mr.Varghese Mathew, who was the Superintending Engineer, KIP Circle, Kollam and against the appellant herein. He took over the investigation. Pending investigation, the Superintending Engineer, Varghese Mathew, died. After completing the investigation, the charge sheet was filed against the appellant as 1[st] accused and late Ramachandran Nair, the Executive Engineer, KIP, RB Division 5, Kollam as 2[nd] accused. It was alleged that the appellant herein was a successful bidder in Crl.Appeal No.1112/02 3 respect of the construction of Kallada Irrigation Project, Part-II at Ch.54540m to 54814m. Being a successful bidder, the appellant was informed about the acceptance of the bid. Responding to the communication, the appellant turned up and executed Ext.P2(a) agreement with PW2, then Superintending Engineer. Ext.P2(a-2) is the local competitive bidding specification executed in between PW2 and the appellant. As per Appendix-L1 attached to Ext.P2(a) item No.3 is the earthwork excavation. The estimated quantity of the work was 17,718 m[3] . The work was undertaken at the rate of Rs.31 per m[3] . In pursuance to Ext.P2(a), possession of the land was handed over to the appellant. The work started on 27.10.1988. As per the terms of the agreement, the work ought to have been finished in July 1989. But it was finished only on 31.12.1989. Since the work could not be completed in time, the appellant sought for extension of time. It was granted for which supplementary agreement was also executed on condition that the appellant would not lodge any extra claim. As per the allegation of the prosecution, on 24.4.1991, the appellant lodged the claim for extra work before late Varghese Mathew, the then 4 Crl.Appeal No.1112/02 Superintending Engineer. As per the allegations in the final report filed by PW20, in respect of the earthwork excavation there is no extra work. But the appellant conspired together with then Superintending Engineer and in pursuance to such criminal conspiracy Ext.P2(b) supplementary agreement was executed, whereby for the earthwork excavation of an approximate quantity of 22886.550 m[3 ] the appellant is to be paid at the rate of Rs.75 per m[3] as extra item as against original agreed rate of Rs.31 per m[3] . Ext.P2(b) was executed on 30.4.1991 on the day on which the then Superintending Engineer retired from service. In pursuance to Ext.P2(b), the appellant submitted a claim for earthwork excavation amounting to Rs.22886.559 m[3 ] at the rate of Rs.75 per m[3] . Ext.P9 bill would show that for a quantity of 20,736.807 m[3] as extra item bill was passed at the rate of Rs.45 per m[3] . Thereafter the appellant again made claim for the said work. Ext.P11 bill would show that the bill was passed sanctioning at the rate of Rs.70 per m[3] for the above said quantity and after deducting the earlier payments and other items the payment was duly made. Thereafter, Ext.P13 final bill was also submitted and payments were effected Crl.Appeal No.1112/02 5 ## adjusting the earlier payments. 4. According to the prosecution, there is no extra item of work whereas it is only an added quantity of work and as per the terms of the agreement, if the added quantity of work is plus or minus 30%, it is to be executed at the rate for which the agreement was executed. The additional quantity of work executed is within 30% of the estimated quantity. In such a circumstance, the claim put forward by the appellant more than one year after the execution of the work and the execution of supplemental agreement is the result of a criminal conspiracy between the then Superintending Engineer and the appellant. So also, overruling the objections made by the office including the Divisional Accountant, the 2[nd] accused passed Ext.P11 bill on the date on which he retired from service and it was also because of the criminal conspiracy between the appellant, the Superintending Engineer and the Executive Engineer. In executing Ext.P2(b) and passing the bill in excess of the quoted rate of Rs.31/M[3 ] the Superintending Engineer and the Executive Engineer abused their office with a motive to have undue pecuniary advantage to the appellant and as a result, the 6 Crl.Appeal No.1112/02 appellant got undue pecuniary advantage. For the earth excavation work which was agreed to be executed at the rate of Rs.31/- per M[3 ] the appellant got at the rate of Rs.75/- per M[3] . Thereby he had undue pecuniary advantage amounting to Rs.8,34,232/-. 5. The Special judge, taking cognizance, issued process, responding to which the appellant and the 2[nd] accused, who is now no more, entered appearance. After hearing either side and finding that there are materials to frame charge, the learned Judge framed charge. The appellant and the other accused pleaded not guilty when the particulars of the offence was read over. Hence both accused were sent for trial. On the side of the prosecution, PWs 1 to 18 were examined and Exts.P1 to P33 were marked. On the side of the defence, Exts.D1 to D6 were marked. No oral evidence was adduced. The appellant admitted that he was the contractor for the execution of the work in dispute. The payments covered by the bills produced were also not disputed. In a separate lengthy written statement, it was stated by the appellant that he had finished the work on 31/12/1989. If the bill and comparative statements were Crl.Appeal No.1112/02 7 prepared by the Assistant Engineer and other hierarchy of the officers in time as per the PWD manual and MCB conditions, the then Superintending Engineer would have determined the extra item of work and the rate would have been negotiated and payment would have been effected before 05/10/1990. But the Assistant Engineer and the Executive Engineer furnished the comparative statement on 10/7/1990 and 24/1/1991 respectively and only thereafter the negotiations could be effected and that he had not entered into any criminal conspiracy with Varghese Mathew, the then Superintending Engineer. It was further alleged that since it was stated that unless the appellant gives an undertaking that no extra claim would be made, the payment of the work executed would not be made, the appellant was constrained to give a conditional letter stating that he would not make any claim for extra item of earth work. Though he had given a conditional letter, the payment was not made before 31/3/1990 and that the department had raised various objections regarding the quantity of work and it was approved only on 29/4/1991 and that though an additional work amounting to 5160 M[3 ] was sanctioned the payment was made only for 20736 Crl.Appeal No.1112/02 8 M[3] and that he had not committed any crime. The trial court, on an appraisal of the evidence, arrived at the following conclusion in paragraph 172 of the impugned judgment as follows: ## **172. Now, here is the summary of the findings:** (a) Ext.P2(a) agreement was executed by A1 and the then Superintending Engineer on 12/09/1988. Notice of work was sent to A1 on 11/10/1988. The site was handed over to A1 on 27/10/1988. The work was started on 29/11/1988. (b) The work in question - involved in this case - is relating to item No.3 of Appendix L1 of the schedule of work attached to Ext.P2(a). (c) That item of work (L1-3) includes the dumping of spoil in the Contractor's own compound, rehandling the spoil, and also all leads and lifts, and depositing the spoil simultaneously over the cut and cover etc. (d) As per clause 13 of Ext.P2(a-3) the Contractor was not eligible to extra rate for any increase of quantity as a result of change in slope or widening of width. (e) As per Clause 31 of Ext.P2(a-2) the Contractor is not eligible to extra rate for Crl.Appeal No.1112/02 9 quantity variation not exceeding 30% of the agreed quantity. (f) The work was to be completed within nine months from the date of notice to work. If so it should have been completed on 10/7/1989. (g) As per Ext.P2(c) the period of completion of the work was extended up to 31/12/1989. (h) It was on 28/1/1989, as per Ext.P7 (b) the then Asst.Executive Engineer reported that cracks had developed and that the cracked earth should be removed and that the additional quantity estimated was about 6000 M[3] . (i) Pages 35 and 36 of Ext.P5 contained the notes of Technical Assistant (of the office of Supdtg. Engineer). That proposal (as per which it was not treated as extra item) was accepted by the Personal Assistant to the Supdtg.Engineer on 21/7/1989. That was further approved by the then Supdtg.Engineer (vide para 27 of judgment). (j) On 31/7/1989 the then Supdtg.Engineer, as per Ext.P7(d) required the Executive Engineer to obtain an Crl.Appeal No.1112/02 10 undertaking from A1 as per Clause 13 of Ext.P2(a-3) stating that it was only quantity variation and that no extra payment could be allowed. (k) Again on 16/08/1989 the Technical Asst. noted that the Executive Engineer should obtain the undertaking from A1 that he will not claim extra rate. (This is the continuation of the notes just mentioned above (vide para 28 of judgment). (l) Page 71 of Ext.P5 shows that the additional quantity occurred due to the change of bottom width from 3.6 M to 4.6 M and change of slope was measured and payment was effected. That note was seen and initialled by all the officers including the then Supdtg.Engineer in March 1990. (vide para 29 of judgment). (m) Due to the development of cracks and the consequent widening of slopes and widening of the bottom width an additional quantity of 5,106.559 M[3] was executed by A1. That work was falling under L1-3 of Ext.P2 (a). In view of clause 13 of Ext.P2(a-3) and Clause 31 of Ext.P2(a-2) it was not an extra item. The quantity variation was only up to 28.72%. The original rate agreed and Crl.Appeal No.1112/02 11 accepted by A1 was only Rs.31/M[3 ] . (n) As per Clause 31 of Ext.P2(a-2) even for the quantity exceeding 30% of the agreed quantity, Contractor was entitled to get extra rate only for the quantity exceeding 30% of the agreed quantity. Even in such cases, for the quantity up to 30% contractor was entitled to get only the agreed rate. Therefore, A1 was not entitled to get extra rate for the additional quantity of 5,106.559 M[3] . (o) A quantity of 14,147.695 M[3] of earth work excavation falling under L1-3 was executed and was measured and check measured on 13/2/1989. That measurement shown in Ext.P3 was accepted by A1. Payments for the same at the rate of Rs.31/M[3] effected as per part bills were accepted by A1 without any objection. (p) As on 28/8/1989 a total quantity of 19,755.10 M[3] had been executed. Deducting the payment already made, payment was effected for the balance quantity also at the rate of Rs.31/M[3] . That was also accepted by A1 without any objection. (q) Even as per Ext.P2(c) dated 20/3/1990, A1 had agreed that he will not Crl.Appeal No.1112/02 12 claim any enhanced rate for such items of work either due to the increased rate of materials or labour or on any ground whatsoever; he had agreed (as per Ext.P2(c) dated 20/3/1990 also) to execute the work on the conditions prescribed in Ext.P2(a) itself. (r) For the cutting of KottiyamKundara Road extra payment had already been effected on 30/3/1990. (vide para 29 of judgment). (s) Again regarding the additional quantity excavated as per Ext.P5(a), the Personal Asst. to Supdtg. Engineer noted that it was only quantity variation. That was approved by the then Supdtg. Engineer and negotiation was ordered to be done only as stipulated under Clause 31 of LCB for the quantity variation. That was also approved by the then Supdtg. Engineer on 27.4.1991. (vide para 37 of judgment). (t) Regarding this additional quantity PW3 has stated that it was only as insisted by Mr.Varghese Mathew, it was shown as extra item. That indicates the prior meeting of minds between A1 and Mr.Varghese Mathew to obtain pecuniary advantage illegally. (vide para 37 of judgment). Crl.Appeal No.1112/02 13 (u) The subsequent act of later Mr.Varghese Mathew on or after 24/4/1991 also would indicate the meeting of minds between himself and A1 and that Ext.P2(b) was executed in pursuance of the criminal conspiracy between himself and A1. (v) Even though the work had been completed on 30/12/1989 and even though the predecessors in office of deceased Varghese Mathew were not inclined to award extra rate, he (deceased Varghese Mathew) executed Ext.P2(b), on the date of retirement (30/4/1991), treating the entire quantity of earth work excavation amounting to 22,886.559 M3 as extra item and fixed a rate of Rs.75/M[3] , (as against the original agreed rate of Rs.31/M[3] ) totally ignoring the binding contract and the provisions contained in Ext.P2(a-2), P2(a-3) and in Ext.P2(a-1) and Ext.P2(c). Ext.P2(b) was thus found to be a fraudulent one. It involves or implies injury to the State or its property. Hence on all grounds Ext.P2(b) has been proved to be an illegal agreement. (v-1) Even in Ext.P2(b), P3, P9, P11 and P13 and other documents the said Crl.Appeal No.1112/02 14 item of work was continued to be shown; as noted in L1-3 of Ext.P2(a-1) and there was no change of specification or change of nature or scope of work but only quantity variation which was below 30%. (vide para 152 and 153 of judgment). (w) The supplemental agreements executed by deceased Varghese Mathew, were found to be illegal by the inspection party of the Accountant General. (see Ext.P8 (b). (x) The Chief Engineer (PW5) directed as per Ext.P8(a) that payments should not be effected on the basis of the rates shown in Ext.P2(b). (y) PW6, PW8, PW10, PW13 etc. have stated about the Audit objections and also regarding the illegality of Ext.P2(b) in treating the quantity variation as extra item and they suggested payment only at the rate of Rs.31/M[3] . Ext.P8(a), P8(b), Ext.P10(c), P10(c-1), P10(d) and P10(d-1) have been relied upon. (vide para 50 of judgment). (z) The copy of Ext.P2(b) with audit objection was forwarded by PW17 the then Supdtg.Engineer to A2 and it was seen by A2 on 16/3/1992. (vide para 59 of judgment). Crl.Appeal No.1112/02 15 (a-a) The impugned bills were not get scrutinized and initialled by the then Divisional Accountant (PW8). The bill was passed by A2 at the rate of Rs.70/M[3] without getting the signature of PW8. A2 made the controversial and objected payment knowing fully well that it was illegal. That illegal payment was effected on 30/3/1992 and again on 31/10/1992 on the very same day of his retirement. The cheque - Ext.P12(a) was signed and issued by him to the contractor on the very same day: 31/10/1992. (vide para 58 of judgment). (a-b) Page 3 last of Ext.P8(b) also refers to the letter of the Chief Engineer of March 1991 regarding the exorbitant rate. That was also ignored by A2. Since that order was issued by the Chief Engineer all subordinates, including A2, should have gone through the same and obeyed the direction (vide para 59 of judgment). (a-c) Had there been no cracks or widening of slope there would have been no occasion at all for any claim for enhancement since for the quantity already executed payment was effected at the agreed rate long back and it was accepted by A1 without Crl.Appeal No.1112/02 16 objection. That will negative the plea for enhancement for the entire quantity. (vide para 124 and under Section 125 Cr.P.C of judgment). (a-d) Even on 20/5/1991 the Executive Engineer (PW10) had sent Ext.P7(k) to the Supdtg. Engineer pointing out the illegalities of Ext.P2(b). That was also ignored by A2. (vide para 77). (a-e) The plea raised by A1 that he had incurred huge expense towards conveyance for dumping the spoil cannot be sustained since that is covered by the stipulations contained in Ext.P2(a-3) and P2(a-2) and Ext.L1-3 of Ext.P2(a-1). (vide para 115 and 154 of judgment). (a-f) Inspite of the Audit objections and the dissenting notes of the officers, A2 issued a specific direction to PW15 on 5/2/1992 as per Ext.P8(g) to treat the entire quantity as extra item and to prepare the bill and to send it to him. It was on that basis PW15 later prepared the bill. (vide para 110 of judgment). (a-g) The second payment covered by Ext.P11 was effected after Ext.P8(d) the letter of A1 dated 22/10/1992. Since A1 was Crl.Appeal No.1112/02 17 aware of the illegality of the agreement and also the fact that he was not entitled to claim extra rate for quantity variation which was less than 30% and also when there was audit objection and the dissenting notes of all the officers and also when there was direction from the Chief Engineer not to pass the bill at the rates shown in the supplemental agreements and since the bill was passed without getting the endorsement and signature of the Divisional Accountant, it would clearly show that A1 and A2 had conspired together to pass the bill at the rate of Rs.70/M[3] on the date of retirement of A2 and that was why the cheque was also issued by A2 on the very same day. (a-h) Had it not been prompted by illegal consideration and had there been no conspiracy between A1 and A2, in view of the patent illegality of Ext.P2(b) and the objection raised by all officers including the Chief Engineer, A2 would not have passed the two bills on 30/3/1992 and 31/10/1992. That also shows there was criminal conspiracy between A1 and A2 for illegally passing the two bills; Ext.P9 and P11. Crl.Appeal No.1112/02 18 Again at paragraph 173 of the impugned judgment regarding the payments, the trial court entered the following findings: ## **173. Here is the calculation regarding the excess payment, the loss caused to the State etc.** (a) CC Bill 6 and part was prepared for the entire quantity of 22,886.559 M[3] at the rate of Rs.31/M[3] . A2 adopted a clever device and in order to make it a part-bill, he showed the quantity as 20,736.807 M[3] and allowed the bill at the rate of Rs.45/M[3 ] . (b) For the entire quantity of 22,886.559 M[3] the amount payable to A1 at the rate of Rs.31/M[3] was only Rs.7,09,483.32. For the quantity agreed as per Ext.P2(a); namely for 17780 M[3] , the amount payable at the rate of Rs.31/M[3] was only Rs.5,51,180/-. (c) A1 was entitled to get only the agreed rate of Rs.31/M[3 ] . Even if A1 had felt that as per the letter of the Chief Engineer, the Contractor could be paid reasonable reduced rate, adding 50% to the original rate of Rs.31/M[3] the reasonable enhanced rate if at all payable could be only Rs.45/M[3 ] . Crl.Appeal No.1112/02 19 (d) Even if it is assumed that A1 was to be given a reduced reasonable enhancement for the additional quantity executed by him due to the change in slope that was payable only for the quantity of 5,106.559 M[3] . (e) If payment is allowed at that rate (Rs.45/M[3] ) for the additional quantity of 5,106.559 M[3] then the amount payable to A1 would be Rs.2,29,795.15. So adding this amount along with Rs.5,51,180/- (which was the amount payable to A1 for the agreed quantity of 17,780 M[3] at the rate of Rs.31/M[3] ) the total amount payable to A1 would be only Rs.7,80,975/-. (f) As against this, A1 had effected payment at the rate of Rs.70/M[3] for the entire quantity of 20,736.807 M[3] . That payment would come to Rs.14,51,576/-. Even then the illegal excess payment given to A1 would come to Rs.6,70,601/-. (g) The total payment which A2 had intended to effect at the rate of Rs.70/M[3] for the entire quantity of 22,886.559 M[3] would be Rs.16,02,059/-. (h) By allowing Rs.70/M[3] for the agreed quantity of 17,780 M[3] , alone which Crl.Appeal No.1112/02 20 had been executed prior to August 1989 as against Rs.31/M[3] and by effecting payment at the rate, the loss caused to the State was Rs.6,93,420/-. (i) Since the payment effected was only in respect of a quantity of 20,736.807 M[3] and since the actual quantity executed was 22,886.559 M[3] , for the balance quantity of 2,149.752 M[3] , at the rate of Rs.31/M[3] the amount payable was Rs.66,642.31/- (j) If this amount is deducted from the total illegal payment of Rs.8,08,735.47 (effected for 20,736.807 M[3] ), the balance illegal payment effected by A2 would come to Rs.7,42,093/-. (k) These illegal excess payments were effected by A2 as per Ext.P14(a) dated 30/3/1992 and Ext.P12(a) dated 31/10/1992. Even at the modest rate, interest on the said illegal payment mentioned above for the period of about 10 years would itself come to more than Rs.Five lakhs. 6. Ultimately the learned Judge arrived at a conclusion of guilt consequent to which the appellant and the 2[nd] accused were convicted and sentenced as above. Crl.Appeal No.1112/02 21 7. The fact that the appellant was a successful bidder in respect of the work in dispute relating to chainage 54540 M to 54814 M is not only disputed but also admitted. It was proved by the testimony of PW2, the then Superintending Engineer, PW4, the Executive Engineer, PW5, another Superintending Engineer, PW6, the Upper Division Clerk, PW9, the Junior Superintendent, PW12, yet another Executive Engineer, PW13, the Assistant Executive Engineer, PW14, the Superintending Engineer, Field Study Circle. 8. PW2, would depose that at the time when the agreement was executed by the appellant, he was the Superintending Engineer and on behalf of the State, he signed the agreement which was marked as Ext.P2(a) on behalf of the State and that the appellant also signed the agreement and it is in pursuance of Ext.P2(a), the work in dispute was entrusted to the appellant. Ext.P2(a) agreement was executed on 12/09/1988 with nine months time for completion of the work. Item No.3 in appendix L1 attached in Ext.P2(a-1) schedule is the work in dispute. For a correct appraisal, a reading of item No.3 of appendix L1 is appropriate. Crl.Appeal No.1112/02 22 ## 3. 17780 M3 Earth work excavation in all classes of soil except hard rock which requires blasting but including boulders up to 0.10 M[3] in size and medium rock which requires stray blasting to lines and grades for forming the trench of cut and cover and depositing the spoil in the Contractor's own dumping yard, and depositing the spoil simultaneously over the Cut and Cover and barrel wherever possible including putting up necessary bunds and other temporary structures and other works necessary to maintain the excavation in good order during construction and removing such temporary structures when required including rehandling the earth from the Contractor's own dumping yard and depositing over the cut and cover barrel upto the original level including neat banking and all leads and lifts lighting and watering etc. complete as per the directions of the Engineer-in-charge and as per specification.” Ext.P2(a-2) is the LCB specification. Clause 31 of Ext.P2(a2) reads as follows: Crl.Appeal No.1112/02 23 ## 31. SCHEDULE OF QUANTITIES “Variation in the quantities of work in the Bill of Quantities shall not vitiate the contract. The rates quoted for the individual items shall apply for the quantities of work increased or decreased by not more than thirty per cent for each of the items. Should quantities of work actually involved under any item exceed quantities provided in the tender by more than thirty percent the rates of such excess over thirty percent of quantity provided in the tender may be revised in accordance with the procedure indicated under clause 'Extra items'. However the said revised item rate shall not exceed the item rate quoted, subject to adjustment in accordance with price adjustment clauses. Should the quantity of work actually involved under any item be reduced by more than thirty per cent of quantity provided in the tender, the bid unit price for the affected item may be revised in accordance with the procedures indicated under 'Extra items.' However, the total cost of such item should not exceed the cost of seventy per cent of the item quoted subject to adjustment in Crl.Appeal No.1112/02 24 accordance with price adjustment clauses. The payment for the item will continue to be made at the original rate until the revised rate is decided.” Clause 32 in Ext.P2(a-2) is the provision regarding extra work. Clause 32 reads as follows: Clause 32: Extra items of work shall not vitiate the contract. The Contractor shall be bound to execute extra items of work as directed by the Supdtg. Engineer. The rates for extra items are to be mutually agreed. Ext.P2(a-3) is a specification for canal works. Clause 13 of Ext.P2(a-3) reads as follows: ## 13. Canal Section: The Canal Sections are shown on the drawings but the undetermined stability or porosity of the material in which these sections will be constructed and which will form the canal banks or other causes may make it desirable during the progress of the work to vary the slopes of the excavation or the slopes of embankments and the dimensions dependent thereon. Any increase Crl.Appeal No.1112/02 25 or decrease of quantities excavated as a result of such change will be covered by the estimates of the quantities and the contractor is not eligible for any extra payment over agreed rates in the schedule for the item on this account. In unlined sections the canal shall be excavated to the full depth and width required and shall be finished to the prescribed lines and grades in a workman-like manner. Where the canal is to be lined with concrete or masonry the canal shall be excavated to a sub grade and section as shown on the drawings or as prescribed by the Engineer-in-charge to allow for the thickness of the concrete lining or masonry lining. Unless otherwise directed or approved by the Engineer-in-charge the excavation for a turn cut bridge abutment or footing, or other structure lying largely outside of canal prism shall follow the excavation of the canal and the canal prism at the structure site shall be completely excavated as provided in this paragraph. Runways or foot paths shall not be cut into canal slopes below the proposed water level. Earth slopes shall be finished neatly with scrapers or other means approved by the Crl.Appeal No.1112/02 26 Engineer-in-charge. Where the original ground surface is below the grade of the canal, the bottom of the canal shall be filled to grade in the manner prescribed for the construction of canal embankments. In so far as practicable, the furnishing operation required in canal sections shall be performed by the contractor simultaneously with the canal excavations.” 9. According to the prosecution, by virtue of clause 31 of Ext.P2(a-2), there is no extra work at all unless the specified quantity in the schedule exceeds more than 30%. The defence had got a contention that after the earth work excavation, there developed horizontal and vertical cracks along the side of the canal and to avoid the same, there was change in slope. So there was an extra item of work. On the other hand, the prosecution would contend that even if there is change in the slope of embankments in view of clause 13 of Ext.P2(a-3) quoted earlier, the appellant is not entitled to any extra payment over the agreed rates in the schedule for the item of work. 10. It is also the case of the prosecution that on expiry of the period of execution of the work, at the request of the Crl.Appeal No.1112/02 27 appellant, the time for execution of the work was first extended up to 30/09/1989 and thereafter responding to the request made by the appellant for another extension, the period for execution of the work was extended up to 30/12/1989 for which Ext.P2(c) agreement was executed. The period of execution of the work was extended by Ext.P2(c) on condition that the appellant would not claim any enhanced rate on account of the extension of time either due to the increased rate of labour or materials or any other ground whatsoever. On the other hand, the contention of the appellant is that the delay was caused by the State in supplying materials like cement and steel and taking steps for the removal of the hurdles and according to the learned counsel, there was inflow of water and thus there arose difficult situation in the execution of the agreed work. Therefore, there was extra item of work. It is, taking into account of that aspect, Ext.P2(c) agreement was executed with no separate schedule other than the schedule attached to Ext.P2(a-1). It is also the case of the appellant that there was an arbitration proceedings and the Arbitrator had, vide Ext.D1, approved the claim made by the appellant against which there was no challenge. Ext.D4, the 28 Crl.Appeal No.1112/02 copy of the execution petition in E.P.No.17/1999 in O.P.(A) 226/1995 before the Sub Court, Thiruvananthapuram was produced stating that there was proceeding for execution of Ext.D1 award. Now the rival contentions can be considered in the light of the evidence on record. 11. PW3 had deposed that she was the First Grade Draftsman attached to the office of the then Superintending Engineer and that Ext.P2(b) is the supplemental agreement executed between the then Superintending Engineer and the appellant on 30/04/1991 and that she is an attester in Ext.P2(b) and as per the schedule attached to Ext.P2(b), the quantity of earth work excavation was 22886.55 M[3] and the rate of work was Rs.75/- per M[3] and that in Ext.P5 file, there is a note put up by her regarding execution of Ext.P2(b) agreement and that Ext.P4 (a-1) in Ext.P4 file is the comparative statement prepared by the then Executive Engineer. In Ext.P4(a-1), the rate noted was Rs.31/- per M[3] for an executed quantity of earth work as 22886.550 M[3] . 12. According to PW3, the Personal Assistant to the then Superintending Engineer, had put a note “negotiation may be Crl.Appeal No.1112/02 29 done as per Clause 31 of LCB for the quantity variation and that Ext.P4(b) is the chart prepared for the negotiation in which she had noted the earth work quantity at 22886.55 M[3] and the rate quoted was Rs.31/- per M[3] and as requested by the then Superintending Engineer, she had noted it as an extra item of work. Though she had recommended only Rs.31/- per M[3] , the Superintending Engineer recorded at the rate of Rs.75/- per M[3] and it is in pursuance of that Ext.P2(b) was executed on 29/4/1991 and on the next day, the then Superintending Engineer retired from service. 13. PW4 was the Executive Engineer at the time of the execution of the work. He would depose that the Assistant Executive Engineer had recommended change in the slope of the canal by a report dated 28/1/1989 which was marked as Ext.P7 (b) and on the basis of that report, he sent the original of Ext.P7 (c) letter to the Superintending Engineer which was approved by the Superintending Engineer by letter dated 31/7/1989. It was specified in Ext.P7(d) letter to obtain an undertaking from the contractor that he would not claim extra rate on account of variation in quantity due to the change in slope of cutting as he Crl.Appeal No.1112/02 30 is not eligible for extra rates as per clause 13 and on the basis of that letter, the file was forwarded to the Assistant Executive Engineer. 14. PW5 was the Superintending Engineer from February 1989 to November. During his tenure, the work was in progress. According to him, he received the proposal of PW4 for the change of the slope by Ext.P4(c) proposal and Ext.P4(d) is the approval letter wherein it is stated that “undertaking from the contractor to the effect that he will not claim any extra rate on account of variation in quantity due to change in slope in cutting as he is not eligible for extra rates as per clause 13 of Canal Specification which forms part of the agreement was to be obtained. He was also requested to submit necessary earth work level calculation of the revised quantity for approval”. He had further deposed that while so, he was promoted as Chief Engineer and he came to know about the execution of the supplemental agreement and that Ext.P8(a) is the copy of the communication issued by the Chief Engineer to the Superintending Engineer to stop all the works in pursuance to the execution of the supplemental agreement and to proceed only after the inspection. Crl.Appeal No.1112/02 31 15. PW6, the Upper Division Clerk attached to the office of the Executive Engineer would depose that the second accused was the Executive Engineer who retired from service on 31/10/1992. He had proved Ext.P9 bill prepared by the second accused. PW6 had further proved Ext.P10 office note regarding work bills and that Ext.P10(a) is a note put up by him wherein he had noted for fixing a reasonable reduced rate. Upon that the second accused had passed Ext.P9 bill sanctioning at the rate of Rs.45/- per M[3] . Ext.P9 is the subsequent bill passed by the second accused on the date of his retirement. Ext.P10(b) is the note put up by PW6 relating to Ext.P11 bill. He had noted that relating to the execution of the supplemental agreement, there was audit objection. But overruling his objection, Ext.P11 bill was passed by the second accused sanctioning payment at the rate of Rs.70/- per M[3] for the work in dispute. PW6 had also proved that the payment was made by cheque, the counterfoil of which was marked as Ext.P12. 16. PW8 was the then Divisional Accountant at the office of the second accused. He would depose that he received Ext.P11 bill whereby payment at the rate of Rs.75/- per M[3] was Crl.Appeal No.1112/02 32 recommended for a quantity of 22886.559 M[3] . In Ext.P10(c), the then Section Clerk had put a note against granting such enhanced rate and perusing the file, PW8 had noted that the payment was not advisable. But ignoring his note, the second accused passed the bill for payment at the rate of Rs.75/- per M[3] . He had further deposed that in pursuance to the order of the second accused on 30/10/1992, payment of Rs.5,06,807/- was made, that too, without obtaining the approval of PW8. 17. PW10 would depose that he was the Executive Engineer from May 1990 to November 1991 and that Ext.P4(g) is a letter signed by him to the Superintending Engineer regarding the necessity for changing the slope and that Ext.P4(a) is the comparative statement submitted by him regarding the change of the slope and that due to the change of slope, an additional earth work was estimated at 5036.49 M[3] and that since the additional quantity was below 30%, it could not be treated as an extra item and that he had not recommended for treating the additional earth work as an extra item but without he being consulted the supplemental agreement was executed by the Superintending Engineer. According to him, he came to know Crl.Appeal No.1112/02 33 about the execution of the supplemental agreement only when he received the copy of the same. Immediately, he reported that before executing the supplemental agreement, he was not consulted and that the supplemental agreement was not correct. 18. PW11 was the Divisional Accountant from 17/12/1990 to 07/05/1992. He would depose that he had received the work bills through the Junior Superintendent, Technical Assistant etc. and that regarding the supplemental agreement, he had put Ext.P10(a) note that since the additional work was below 30%, it cannot be treated as an extra item of work and that payment could be made only at the rate of Rs.31/- per M[3] as per the original agreement. The second accused, who was the Executive Engineer, overruled his objection and payment at the rate of Rs.45/M[3] was approved and that Ext.P14(a) is the counterfoil of the cheque for which payment was made as pr Ext.P9 bill. 19. PW13 would depose that he was the Assistant Engineer and that Ext.P11 bill was prepared by him as a final bill as directed by the Assistant Executive Engineer on a representation made by the appellant. It was submitted as a part bill and that Ext.P8(d) is the order of the Assistant Executive Crl.Appeal No.1112/02 34 Engineer. He had further deposed that Ext.P17(b) is his note on the file and in Ext.P17(b) he had noted the irregularities and the objection of the Accountant General regarding the supplemental agreement. He had suggested Rs.31/M[3] for the executed quantity of work. But the amount recommended by PW13 was rounded by the second accused and recommended at the rate of Rs.70/M[3] for a total quantity of 20736.807 M[3] and that Ext.P11 bill was accordingly passed. 20. PW14 was the Executive Engineer from 23/12/1994 to 01/04/1995. He joined duty after the execution of the work. According to him, Ext.P13 is the final bill and that there was an excess payment of Rs. 8,08,735/- and that he had put a note for recovering the excess amount with interest from the appellant. From the evidence which I discussed earlier, it can be seen that Ext.P2(b) agreement was ordered to be executed as a supplementary agreement regarding the earthwork excavation in pursuance to a representation made by the appellant about one year and four months after the completion of the work. Though Ext.P2(c) was executed on condition that the appellant would not make any claim for extra payment, in ExtP2(b) the work was Crl.Appeal No.1112/02 35 treated as an extra item and Ext.P2(b) was executed enabling the appellant to make a claim 240 times above the rate quoted by him in the open bid pursuing to which Ext.P2(a) original agreement was executed. The evidence of PW10 would show that before the then Superintending Engineer treating the work as an extra item and ordering to execute the supplementary agreement, PW10, the Executive Engineer, was not at all consulted. Ext.P4(b) would show that the then Executive Engineer before ordering to execute a supplementary agreement had not obtained any report or remarks from the Assistant Executive Engineer or any officer below the Superintending Engineer regarding the nature of the claim put forward by the appellant. The appellant, in his representation dated 24.4.1991 had claimed at the rate of Rs.95 per m[3] . The representation was seen directly submitted to then Superintending Engineer. Without obtaining a report on the representation so made by the appellant, a negotiation was seen hastly arranged on 29.4.1991 that too, without the assistance of the Executive Engineer or Assistant Executive Engineer or Assistant Engineer and for the execution of the earthwork excavation Rs.75 per m[3] was Crl.Appeal No.1112/02 36 sanctioned as against the agreed rate of Rs.31 per m[3] . Accordingly, Ext.P2(b) supplementary agreement was executed on 30.4.1991, that is, on the date of retirement of the Superintending Engineer. While executing Ext.P2(c), the undertaking made by the appellant that he would not make any extra claim as deposed by PW4 and evidenced by Exts.P4, P7(c) and P7(d) was ignored by the Superintending Engineer. In this juncture, Ext.P4(e) letter dated 30.3.1990 is also relevant. In Ext.P4(e), the appellant had made a request stating that he would not claim any payment for extra work, provided, the amount due to him was paid on or before 31.3.1990. In his statement under Section 313, the appellant would state that he had not previously made any claim as the Executive Engineer and the Assistant Executive Engineer had not prepared the bill or prepared the comparative statement. According to the appellant, if the Executive Engineer and Assistant Executive Engineer had prepared the bill and the comparative statement in time the claim of the appellant could have been earlier allowed by the then Superintending Engineer. I find no merit in that plea. From the evidence on record, undue haste is evident Crl.Appeal No.1112/02 37 regarding the execution of Ext.P2(b) supplementary agreement, that too, without consulting either the Executive Engineer or Assistant Executive Engineer or Assistant Engineer or obtaining a report regarding the genuineness of the claim. Relying upon clause 32 on Ext.P2(a-2) it was argued by the learned counsel for the appellant that the Superintending Engineer is the sole authority to negotiate and determine the rate to which the contractor is entitled to. Regarding that aspect there is no chance for any quarrel. But it is to be remembered that while negotiating upon a claim for extra payment by contractor, the Superintending engineer had to obtain necessary remarks and datas in respect of the claim made so as to arrive at a reasonable rate regarding the execution of the work. But that was not done obviously apprehending objectionable note. 21. Going by Ext.P2(a-2) and (a-3), namely, clause 31 of P2(a-2) and Clause 13 of P2(a-3) and P2(a-1) schedule, it is very evident that the quantity of the earthwork excavation mentioned in Ext.P2(a-1) is only an estimate and that as per clause 31, regarding the schedule of quantities, the contractor is not entitled to claim an extra item of work if the variation of quantity Crl.Appeal No.1112/02 38 is plus or minus 30% of the estimated quantity. By virtue of clause 13 of Ext.P2(a-3) even if there is any change in the slope of embankments and the dimensions dependent thereon, the contractor is not entitled to any extra payment over the agreed rates. While the then Superintending Engineer allowing the claim of the appellant on the basis of his representation dated 24.4.1991, more than one year after the completion of the work, the Superintending engineer violated the above clauses in the agreement. So also the undertaking made by the appellant while executing Ext.P2(c) supplementary agreement regarding the extension of the period of the execution of the work was totally ignored. The 2[nd] clause of Ext.P2(c) reads as follows: “The contractor shall not claim any enhanced rate or compensation whatsoever for or on account of such additional quantities and over and above the quantities given in the supplemental agreement due to the increase in rates of labour or materials or on any other ground. He shall execute the whole quantities at the rates given in the accompanying schedule.” 22. It is not disputed that Ext.P2(c) agreement containing the above provision was executed by the appellant freely and Crl.Appeal No.1112/02 39 voluntarily. When the circumstance leading to the execution of Ext.P2(b) agreement is considered in the light of the above, the case of the prosecution that there was criminal conspiracy cannot be ruled out. 23. The evidence of PWs9 and 11 would show that it is ignoring the audit objection and the note put up by PW9 and 11, the bills were passed. Ext.P11 bill was passed by the 2[nd] accused on the day on which he retired. It is after overruling the objections noted in the file regarding the claim based upon Ext.P2(b) agreement. 24. The learned counsel for the appellant submitted that the quantity of the earthwork excavation was increased because of the additional work ordered to be executed following the vertical and horizontal cracks developed on the canal slopes. The evidence of PWs 4 and 5 would show that such work was ordered to be executed only after obtaining the undertaking that the contractor would not claim any extra rate on account of the variation in quantity due to the change in slope of cutting as he is not eligible for extra rates as per clause 13 of Ext.A2(a-3). Even if it is assumed that the said item is an extra work, at no Crl.Appeal No.1112/02 40 stretch of imagination the reasonings for agreeing for a higher rate in respect of 17,780.70 m3 as per Ext.P2(a-1) schedule is justifiable. In this view of the matter, it is to be found that there was abuse of the office by the Superintending Engineer and the 2[nd] accused, then Executive Engineer, in hastily executing the supplemental agreement and passing the bills in pursuance to that agreement without recourse to the procedure established by the practice and rules and keeping away other responsible officers and also ignoring the notes of objection raised by PW11, the Divisional Accountant. 25. The learned counsel for the appellant relying upon the decision reported in Varghese Mathew and Others v. State of Kerala [2008 (3) KLJ 165] submitted that the violation of procedures of circulars and departmental orders could not amount to an offence under Section 13(1)(d) read with 13(2) of the Prevention of Corruption Act. 26. Going by the above decision it is seen that in that case the conviction was reversed on a conclusion that the payment made thereon cannot be found illegal merely because of the violation of the orders or circulars. The facts of that case Crl.Appeal No.1112/02 41 revealed in evidence was not at all discussed in the reported judgment. It is also seen that the learned Single Judge had given reliance to the decisions of the Apex Court in Major S.K.Kale v. State of Maharashtra [AIR 1977 SC 822], C.Chenga Reddy and others v. State of A.P. [1996 (10) SCC 193] and Abdulla Mohammed Pagarkar v. State [1980(3) SCC 110]. Going by the above decisions, it is seen that those decisions are with reference to a particular set of facts which has absolutely no bearing with the case on hand. Here, it is not the question of any violation of the circulars or procedures or government orders. But the issue is relating to the clandestine manner in which the appellant had lodged a claim one year and four months after the complete execution of the work and the manner in which the supplemental agreement was executed on the eve of the retirement of the Superintending Engineer and the passing of the bills by the 2[nd] accused on the eve of his retirement. The evidence on record in this case would convincingly establish that there was abuse of office by the Superintending Engineer and the Executive Engineer in executing Ext.P2(b) agreement and in passing the bills for payment a high and exorbitant rate, namely Crl.Appeal No.1112/02 42 240 times of the originally agreed rate. As concluded by the Special Judge, the appellant is not entitled to any extra rate other than the rate in Ext.P2(a). It is knowing that aspect, the appellant also agreed in Ext.P2(c) dated 20.3.1990 that he is not entitled to claim any extra rate. The Superintending Engineer and the 2[nd] accused were also aware of it. But to agree for a higher rate, Superintending Engineer and the appellant conspired together and Ext.P2(b) agreement was executed on 30.4.1991. The 2[nd] accused also knowing the fact that the appellant was not entitled to extra claim additional bills were prepared and passed overruling the objection by the Subordinate officers. Conspiracy between the appellant and 2[nd] accused is also evident. Bills were passed very hastily and last payment was on the date of retirement of the 2[nd] accused. 27. The learned counsel for the appellant relying upon the charge framed by the trial court submitted that in the charge there is no mention that there was criminal conspiracy in between the appellant and the then Superintending Engineer or 2[nd] accused regarding the execution of Ext.P2(b) supplementary agreement. It is true that there is such omission. Going by the Crl.Appeal No.1112/02 43 final report submitted by PW18, it is seen that there is such specific allegation. The written statement of the appellant when questioned under Section 313 of the Code of Criminal Procedure would show that the appellant had faced the trial with the knowledge that he was being prosecuted with an allegation that there was criminal conspiracy in executing the supplementary agreement. He would give his own justification for lodging of the claim one year and four months after the execution of the work and executing the supplementary agreement on the eve of the retirement of the Superintending Engineer. However, it is evident that the offence under Section 120B was specifically mentioned in the charge sheet. 28. In the above circumstance, I find that the omission in the charge framed by the trial court that there was criminal conspiracy in executing the supplementary agreement is not at all significant and no prejudice was caused to the appellant because of such omission. Therefore, the appellant is not entitled to an order of acquittal for that reason. The learned counsel for the appellant, referring to Ext.D1, an award said to have been passed by the Arbitrator heavily assailed the Crl.Appeal No.1112/02 44 impugned judgment. According to the learned counsel, the award has become final and in that award the claim made by the appellant at the rate of Rs.75 per m[3] for the work in dispute was allowed. The learned Public Prosecutor would submit that the said award has not matured to a decree and it has no validity and for that reason the appellant cannot escape. The impugned judgment would show that the learned trial Judge had considered the same contention and accepting the submission of the prosecution had rightly rejected the same. Adding to the above, it is seen that the conspiracy was with the contractor and the officers responsible for the execution of the work who were in trust of the public money. In the event the arbitration proceedings was also defended by then officers in the manner done by the Superintending Engineer and the Executive Engineer there is no wonder in the appellant getting award like Ext.D1. Since Ext.D1 is not enforceable, the appellant is not entitled to justify the undue pecuniary advantage he had got in pursuance to the conspiracy. 29. The circumstances revealed out would convincingly establish that there was criminal conspiracy between the Crl.Appeal No.1112/02 45 appellant and the Superintending Engineer in getting Ext.P2(b) supplemental agreement executed. So also, conspiracy between the appellant and 2[nd] accused in passing Ext.P11 bill. As a result of the execution of the Ext.P2(b) supplemental agreement and passing of the final bill, the appellant had become entitled to claim @ Rs.75/M[3] for the earthwork excavation as against the quoted rate of Rs.31/M[3] for 22,886.559 M[3] . The monetary benefit that the appellant would get is very exorbitant. If the amount due to the appellant at the originally agreed rate is calculated, it would come to Rs.7,09,483.33/-. At the revised rate, it would come to Rs.17,16,491.90. The difference is Rs.10,07,008.60/-. The conspiracy was for making that much undue advantage to the appellant. The trial court had correctly analysed the evidence and arrived at right conclusion of guilt. The evidence on record would convincingly establish that the quantity of earthwork excavation exceeded only because of the change in slopeof the canal. By virtue of clause 13 of Ext.P2(a3) quoted earlier, the appellant is not entitled to any extra rate. By virtue of clause 31 of LCB Specification (Ext.P2 (a-2)), the excess quantity being less than 30%, the additional quantity may Crl.Appeal No.1112/02 46 not account as an extra item. It is acknowledging this fact, Ext.P2(c) agreement was executed whereby the appellant agreed that he would not make any extra claim. It is in suppression of the above agreement and material facts, Ext.P2(b) agreement was executed in pursuance to the criminal conspiracy. Though objection was raised by PW9 and PW11, it was overruled by the 2[nd] accused and bills were passed. Conspiracy between the appellant and 2[nd] accused is also evident. It is as a result, the appellant obtained the undue pecuniary advantage as mentioned above. I find no reason to interfere with the conviction for offence under Section 120B of the IPC. I find that the conviction is based upon cogent evidence. 30. The learned counsel for the appellant filed a petition as Crl.M.A.No.2055/2011 for accepting two documents relating to the treatment of the appellant. The 1[st] document is a certificate issued by the Consultant Neuro and Endovascular Surgeon dated 2.7.2009, wherein it is certified that the appellant aged 80 years was brought to the hospital with a history of loss of consciousness on 10.2.2009. CT Scan brain revealed a major stroke (left MCA infarct). The patient was managed Crl.Appeal No.1112/02 47 conservatively and was discharged on 21.3.2009 and that the patient was bedridden and required help of others for mobilisation. The other certificate is dated 25.2.2011. It is certified that the appellant aged 81 years got memory loss on 10.2.2009 and he was suffering from Smrithi Bhramsam (loss of memory) and he could not recollect his memory constantly and he is undergoing treatment as Thadam, Kashayam, Pills and Thailam for body massage. It is also submitted by the learned counsel for the appellant that due to the variation in ECG readings the appellant was then hospitalized and he was in ICU. However, no document in support of such a plea was produced. The learned senior counsel appearing for the appellant also submitted that as the appellant has lost his memory practically there would not be any effect even if he is detained under the bars. Taking into account of these circumstances, I find that the appellant is entitled to leniency in sentence and that the sentence under challenge requires modification. Considering the fact that the appellant is now an octogenarian having suffered a stroke and loss of memory and is continuously undergoing treatment, I find that sentence of imprisonment till Crl.Appeal No.1112/02 48 the rising of the court with a fine of Rs.5,00,000/- (Rupees five lakh only) would meet the ends of justice. 31. In the result, the appeal is allowed in part. While confirming the conviction, the sentence is reduced to imprisonment till the rising of the court and a fine of Rupees Five lakhs. In default of payment of fine, the appellant shall undergo simple imprisonment for a further period of one year. ## **(P.S.GOPINATHAN, JUDGE)** jsr Crl.Appeal No.1112/02 49 ## **P.S.GOPINATHAN, J.** Crl.A.No.1112 of 2002 JUDGMENT 04/03/2011