Gold jewellery within CBDT prescribed limits does not constitute disproportionate assets in corruption cases.

The petitioner, who was posted as a Child Development Project Officer (CDPO) in Patna, was caught in a trap case (Vigilance P.S. Case No. 54 of 2013) for allegedly taking a bribe.

During a subsequent search of her residence on August 17, 2013, the Vigilance Department seized 646.400 grams of gold jewellery and documents.

Consequently, Vigilance P.S. Case No. 37 of 2015 was registered under Section 13(1)(e) of the Prevention of Corruption Act for Disproportionate Assets (DA) amounting to Rs. 12,71,693/-.

The petitioner challenged the order of cognizance dated January 28, 2021, arguing that the gold belonged to her and her unmarried daughter and fell within permissible limits defined by the Central Board of Direct Taxes (CBDT).

1. Whether the possession of 646.400 grams of gold jewellery by the petitioner and her family constitutes a criminal offense under the Prevention of Corruption Act, given the permissible limits set by executive instructions.

2. Whether the order of cognizance passed by the Special Judge, Vigilance, was legally sustainable in light of the CBDT’s guidelines on permissible gold holdings.

Section 13(2) read with Section 13(1)(e) of the Prevention of Corruption Act, 1988, which pertains to public servants in possession of assets disproportionate to their known sources of income.

Instruction No. 1916 dated 11.05.1994 and the Press Release issued by the Ministry of Finance (CBDT) dated 01.12.2016, which stipulate that in the context of searches, a married woman is entitled to possess 500 grams of gold, an unmarried lady 250 grams, and a male 100 grams of gold jewellery.

While the Vigilance Department argued that these instructions were exclusive to Income Tax proceedings and inapplicable to corruption cases, the court rejected this narrow interpretation.

The court noted that at the time of the search, the petitioner was a married woman (entitled to 500g) and had an unmarried daughter (entitled to 250g), totaling a permissible aggregate of 750 grams.

Since the actual seizure was only 646.400 grams, the court reasoned that the Vigilance Department committed a calculation error and wrongly determined the assets as "disproportionate."

The High Court quashed the order of cognizance dated January 28, 2021, passed by the Special Judge, Vigilance, Patna, in Special Case No. 20 of 2015, insofar as it related to the petitioner.