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How did Jayalalitha’s Disproportionate Assets come down to less than 3 crore rupees – Analysis of the Karnataka High Court Judgement

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The Karnataka High Court Judgement acquitting J Jayalalitha and three others in the disproportionate assets case raised quite a few eye brows. The high court rejected the trial court’s judgement. Estimation of two major expenses (construction & marriage) were significantly reduced by the high court that led to the huge reduction in assets. Also, income from loans and other sources was added to the income leading to a rise in income. Thus the disproportionate assets were less than 10% of the income leading to the acquittal.

The entire country was shocked when the Karnataka High Court acquitted AIADMK chief Jayalalitha in the Disproportionate Assets case. (DA Case). We analysed the high court judgement to understand where it differed with the trial court. Here is a compilation of important areas of the judgement that led to the acquittal.

Construction Activity undertaken by Jayalalitha & Other accused

The Karnataka High Court found fault with the way the cost for the construction activity was arrived at. The high court said that the PWD (Public Works Department) rate of construction per one square of area (100 sq.ft) was working out to Rs 31,580/-. Since this is the rate given to the contractor that accounts delays of payment etc, for any normal construction this rate cannot be considered. Hence the court considered Rs 28,000/- as a more plausible rate for arriving at the cost of construction. It also said that the cost of construction including other facilities like lifts was highly inflated. It said, “As per PWD itself, the construction cost per square will be Rs.31,580.19/-. This is reasonably quite higher. The date of construction is during the check period. The construction rate per square may be somewhere around Rs.28,000/- “

Hence the total cost of construction was worked out to be slightly more than 5 crore rupees. This is significantly less than what the trial court said to be the cost of construction which is close to 27.8 crore rupees. The high court also accepted the contention of the accused that some construction activity was undertaken by companies in which they had no stake.

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Marriage Expenses

The prosecution in the case cited the lavish marriage of Jayalalitha’s foster son Sudhakaran and added this expense to Jayalalitha’s assets. The high court disagreed with the claims of the Prosecution and also the trial court. It accepted Jayalalitha’s version that she spent only Rs 28 lakh on thre wedding and the rest was borne by AIADMK members & the bride’s father who was an IIT Professor. This is again significantly less than what the trial court arrived at. The trial court calculated the marriage expenses as 6.45 crore rupees.

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Loans as Income

The high court said that accused in the case have taken loans from various banks and that has to added to the income of the accused. It also said that the prosecution has lost of this and has calculated the income by ignoring these loans. Interestingly, all the loans given in the order only add up to Rs 10,67,31,274/-. If the Rs 1.5 crore loan was Rs 15 crore, then the math would add up. Only time will tell whether it is a printing mistake or a clear case of mathematical error by the Judge.

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Income from Grape Garden

The high court accepted the income from Grape Gardens and added this to the income of the accused though the IT returns were filed belatedly. Hence an amount more than Rs 46 lakh was added to the over all income of the accused.

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Income from Gifts

The high court accepted the contention of the accused that the gifts received by Jayalalitha on her birthday and also for her son’s wedding have to be included in the income. This also includes a foreign remittance of 77 lakh rupees. The court concluded that the income from gifts would be estimated as Rs 1.5 crore.

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Income from Jaya Publications

The high court accepted that Jaya publications activities include printing, publishing, real estate, news papers etc and hence income from Jaya Publications could be estimated as Rs 4 crore.

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Apparels, Watches, Sarees etc

The high court said the current case deals with alleged disproportionate assets between 1991 & 1996 when the accused was the Chief Minister. It accepted the contention of the accused that Apparels, watches, sarees, gold etc were acquired during her days as a cine actress. The court also said that it is difficult to ascertain when these were bought in the absence of any evidence. And hence all the items were omitted from assets.

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Properties acquired by the accused

The high court said that there is no record or evidence to show that amount over and above the sale deed was paid for acquiring properties. Hence it accepted the sale deed amount of 6.24 crore rupees as the amount used for acquiring properties. It says the argument of the prosecution that more than Rs 20 crore was paid over and above the sales deed does not stand.

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Final Calculation

The high court arrived at the final calculation of assets & income by including all the above observations. There are two significant changes from the calculation of the trial court. The construction cost was reduced by 22.69 crore rupees & the marriage expenses were reduced by 6.16 crore rupees. This is a total reduction of 28.85 crore rupees from the total assets of 66.44 crore rupees as arrived at by the trial court. The new total assets stood at 37.59 crore rupees. Similarly the total income was also arrived at by including some of the heads discussed above. The total income during this period was worked out to be 34.76 crore rupees.

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Disproportionate Assets

The high court calculated the disproportionate assets as the following based on the income & asset calculation and concluded that the disproportionate assets were only 8.12% of the income.

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The Acquittal

The high court relied on the Judgement of the Supreme Court in the Krishnanand Agnihotri’s case where it said that if the DA are to the extent of 10%, the accused are entitled for acquittal. It also relied on a Government of Andhra Pradesh’s circular in 1989 where it said that DA to the extent of 20% are also permissible. Thus Jayalalitha & the other accused were acquitted.

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Featured Image: By Jpullokaran (Own work) [CC BY-SA 3.0], via Wikimedia Commons

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6 Comments

  1. Harikrishna Reddy Mamidi on

    IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 11TH DAY OF MAY, 2015 BEFORE THE HON’BLE MR.JUSTICE C.R.KUMARASWAMY

    The evidence of PW.71 – S.Radhakrishnan, Horticulture Officer reveals at Page No.11 that at Metal King Sudhakaran met Hiriyan personally for 10 minutes. Hiriyan was appointed for the kodanadu Tea Estate and given an honorarium of Rs.5,000/- per month, that day night he and Hiriyan went to Ooty. From there, via 910 Kothagiri went to Kodanadu. He introduced Hiriyan to Kodanadu Manager there and later returned to Thirunelveli. Kodanadu Tea Estate measures 800 acres. In that, already in 700 acres, tea has been cultivated. The remaining were vacant lands. Hiriyan said that there, one acre of land will fetch Rs.1 lakh. In Kodanadu there were two Bungalows, one tea factory and quarters for the employees.On perusal of evidence of PW.71, it is clear that Kodanadu Tea Estate generated income to the extent of Rs.7 Crores. This is the income generated from the tea estate. The Investigating Agency has valued the building constructed in the tea estate and also pipes laid down in the tea estate. But, it is very strange that they have not assessed the income of the tea estate and added to Annexure-III i.e., income during check period between 1.7.1991 to 30.4.1996. The Investigating Agency has omitted this income in Annexure-III. Even defence has not examined any witness as to what is the income generated from the tea estate and they have also not claimed the same. Therefore, this court has not considered this income while calculating disproportionate assets. However, I am constrained to mention that this aspect cannot be ignored totally while calculating the disproportionate assets of the Accused.

  2. We don’t understand the calculation…..but facts people understand…and what all is happening is surprising

  3. Meeting of Arun Jaitly + J Jayalalitha = Peoples got confusion. Verdict + Reaction of BJP Leaders reaction = Doubt of the people cleared.

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