New Delhi, Jan. 7: The Supreme Court has ruled that property owned by an income-tax assessee cannot be construed as actually belonging to that person as it overlooks the possibility of corrupt public servants amassing illegal assets in others’ names.

The order, passed by the court yesterday while setting aside Madras High Court’s decision to discharge two former ministers of an earlier DMK regime in Tamil Nadu, comes as a huge blow to corrupt politicians. N. Suresh Rajan and K. Ponumudi were charged with amassing wealth more than their known sources of income.

“The property in the name of an income-tax assessee itself cannot be a ground to hold that it actually belongs to such assessee. In case this proposition is accepted, in our opinion, it will lead to disastrous consequences. It will give opportunity to corrupt public servants to amass property in the name of known persons, pay income tax on their behalf and then be out from the mischief of law,” the court said.

Referring to the case of the former ministers, the bench continued: “While passing the impugned orders, the court has not sifted the materials for the purpose of finding out whether or not there is sufficient ground for proceeding against the accused but whether that would warrant a conviction.

“We are of the opinion that this was not the stage where the court should have appraised the evidence and discharged the accused as if it was passing an order of acquittal.

“Further, defect in investigation itself cannot be a ground for discharge. In our opinion, the order suffers from grave error and calls for rectification.”

Rajan and Ponumudi were ministers in the DMK dispensation between 1996 and 2001. While Rajan was charged with accumulating over Rs 23 lakh worth illegal assets, Ponumudi was charged with amassing over Rs 3 crore.

They were accused of holding the wealth in the names of their wives and family members who were income-tax assessees in their own right.

A special judge in Tamil Nadu had dismissed their discharge plea and directed framing of charges under the Prevention of Corruption Act and relevant IPC provisions for cheating, breach of trust etc.

However, in 2010, Madras High Court discharged the duo on the ground that there was no material to establish the allegations as the properties were held by assessees who happened to be relatives.

In other words, the high court took the view on the basis of official records that there was no material to prove that the former ministers had accumulated illegal wealth.

But the apex court bench of Justices C.K. Prasad and M.Y. Eqbal, while setting aside the high court order, clarified that: “Any observation made by us in this judgment is for the purpose of disposal of these appeals and shall have no bearing on the trial.”