Discharge Under Section 227 CrPC | Prima Facie Material Suffices For Trial : Bombay High Court

The Bombay High Court's recent judgment in Zunzar Suresh Pawar v. Union of India reaffirms the limited scope of judicial scrutiny at the discharge stage under Section 227 of the Code of Criminal Procedure. The Court clarified that trial courts must only determine whether prima facie material exists to proceed with charges, without conducting a meticulous evidence analysis. This decision underscores the high threshold for accused persons seeking discharge and provides crucial guidance for practitioners handling corruption cases under the Prevention of Corruption Act, 1988.

Background & Facts

The Dispute

The case originated from a Central Bureau of Investigation (CBI) probe into alleged tax evasion by M/s. Gurukul Coaching Classes for the financial years 2013-14 to 2015-16. The CBI registered a case under Section 120B of the Indian Penal Code (IPC) and Section 13(1)(d) of the Prevention of Corruption Act, 1988, alleging a conspiracy between Income Tax Officers and the coaching classes' partners to suppress actual income. The key accusations included:

• Deliberate underreporting of income during an Income Tax Survey conducted on 24 February 2015
• Unauthorized participation of accused no.1 (Zunzar Pawar) in the survey despite lacking jurisdiction
• Alleged payment of ₹20,00,000 as bribe to accused no.1 through a tax consultant (accused no.4)

Procedural History

The case progressed through the following stages:

• 2017: CBI registered Crime No. RC Pune/2017/A/00013 after an Income Tax Survey revealed discrepancies
• 2025: Accused filed discharge applications under Section 227 CrPC before the Special Judge (CBI), Aurangabad
• 11 April 2025: Trial court dismissed the discharge applications, prompting the present criminal revisions

Relief Sought

The revision petitioners sought:

• Quashing of the trial court's order refusing discharge
• Directions to discharge them from the charges, arguing lack of prima facie material
• Reliance on precedents like Dipakbhai Jagdishchandra Patel v. State of Gujarat to contend that the accusations were baseless

The Legal Issue

The central question before the High Court was:

Whether the trial court erred in refusing discharge under Section 227 CrPC by failing to apply the correct standard of scrutiny - namely, whether the chargesheet contained prima facie material to proceed with trial, rather than requiring conclusive evidence?

Arguments Presented

For the Revision Petitioners

The petitioners contended that:

• The Income Tax Survey under Section 133A of the Income Tax Act was a routine exercise, and any discrepancies were subsequently rectified by payment of due taxes
• There was no material to suggest a conspiracy or demand/acceptance of bribes, as required under Section 13(1)(d) of the Prevention of Corruption Act
• Statements of witnesses lacked evidentiary value, as they were not signed by the accused
• The sanction for prosecution was invalid, and the trial court ignored these defects
• Reliance was placed on Dipakbhai Jagdishchandra Patel v. State of Gujarat to argue that the accusations were misconceived

For the Respondent (CBI)

The CBI defended the trial court's order, arguing:

• The chargesheet contained sufficient prima facie material, including statements from Income Tax officials and independent witnesses
• The trial court correctly applied the Section 227 CrPC standard, which does not require in-depth evidence analysis
• The allegations of unauthorized participation in the survey and bribe payment were supported by witness statements
• The case of Vijaykumar Dnyandev Raut v. State of Maharashtra was cited to justify the trial court's approach

The Court's Analysis

The High Court meticulously examined the scope of Section 227 CrPC and the revisional jurisdiction under Section 397 CrPC, emphasizing the following principles:

1. Limited Scrutiny at Discharge Stage: The Court reiterated that at the discharge stage, the trial court's role is confined to determining whether the chargesheet contains prima facie material to proceed with trial. In-depth analysis or re-appreciation of evidence is not required. The Court relied on a catena of judgments, including:

   "The purport is to ascertain whether there is prima facie material suggesting existence of essential ingredients for the offences, which are alleged to be committed."

   The Court cited State of Bihar v. Ramesh Singh, Union of India v. Prafulla Kumar Samal, and Amit Kapoor v. Ramesh Chander to underscore this principle.

2. Prima Facie Material in the Chargesheet: The Court found that the chargesheet contained statements from Income Tax officials and independent witnesses (including staff of the coaching classes) that:

   • Accused no.1 (Zunzar Pawar) participated in the survey despite lacking authorization
   • There were discrepancies between the income reported during the survey and the actual income
   • Allegations of bribe payment through a tax consultant were supported by witness statements

   The Court held that these statements constituted sufficient prima facie material to proceed with trial.

3. Scope of Revisional Jurisdiction: The Court clarified that its role under Section 397 CrPC was limited to testing the legality, propriety, or perversity of the trial court's order. It emphasized that re-appreciation of evidence is not permissible unless the trial court's findings are patently perverse. The Court relied on Amit Kapoor v. Ramesh Chander to state:

   "The revisional jurisdiction can be invoked where the decisions under challenge are grossly erroneous, there is no compliance with the provisions of law, the finding recorded is based on no evidence, material evidence is ignored or judicial discretion is exercised arbitrarily or perversely."

4. No Patent Illegality in Trial Court's Order: The Court found no illegality, irregularity, or perversity in the trial court's order. It held that the trial court had correctly applied the Section 227 CrPC standard and that the chargesheet contained sufficient material to frame charges.

The Verdict

The Bombay High Court dismissed both criminal revision applications. The Court held that:

1. The trial court correctly refused discharge under Section 227 CrPC, as the chargesheet contained prima facie material to proceed with trial.
2. The revisional court found no patent illegality, irregularity, or perversity in the trial court's order.
3. The petitioners failed to demonstrate that the accusations were baseless or that the trial court erred in its application of the law.

What This Means For Similar Cases

Discharge Applications Require Only Prima Facie Material

The judgment reinforces that practitioners seeking discharge under Section 227 CrPC must demonstrate that the chargesheet lacks even prima facie material to proceed with trial. Key takeaways include:

• No in-depth evidence analysis: Trial courts are not required to conduct a meticulous analysis of evidence at the discharge stage. The focus is solely on whether the material suggests the existence of essential ingredients of the offence.
• Burden on the accused: The burden lies on the accused to show that the material in the chargesheet is wholly insufficient to proceed with trial. Mere assertions of innocence or lack of evidence are insufficient.
• Witness statements suffice: Unsigned witness statements can constitute prima facie material if they are otherwise credible and relevant.

Revisional Courts Will Not Re-Appreciate Evidence

Practitioners challenging discharge orders through revisions must be mindful of the limited scope of revisional jurisdiction:

• Narrow grounds for interference: Revisional courts will interfere only if the trial court's order is patently illegal, perverse, or based on non-compliance with legal provisions.
• No second opinion on evidence: Revisional courts will not re-appreciate evidence or substitute their views for those of the trial court.
• Focus on procedural compliance: Challenges to discharge orders must highlight clear errors of law or procedure, not merely factual disputes.

Corruption Cases Under Scrutiny

The judgment has specific implications for cases under the Prevention of Corruption Act, 1988 and tax-related offences:

• Conspiracy allegations: The Court's reliance on witness statements to establish a prima facie case of conspiracy underscores the importance of circumstantial evidence in corruption cases.
• Bribery and kickbacks: Allegations of bribe payments, even if based on witness statements, can suffice to proceed with trial if they meet the prima facie standard.
• Income Tax Surveys: Discrepancies detected during Income Tax Surveys under Section 133A of the Income Tax Act can form the basis for criminal proceedings if they suggest deliberate suppression of income.

Practitioners handling such cases must ensure that their arguments align with the limited scope of scrutiny at the discharge stage and focus on demonstrating the absence of even prima facie material.