Karnataka High Court quashes disproportionate assets case against Sarfaraz Khan, Lokayukta police probe flawed

Bengaluru / Karnataka : 19/08/2020 : A view of the Karnataka High Court on August 19, 2020. Photo : V Sreenivasa Murthy/The Hindu. | Photo credit: SREENIVASA MURTHY V

In a setback for the Lokayukta police, the Karnataka High Court quashed the disproportionate assets (DA) case registered against Sardar Sarfaraz Khan, a retired public servant and former private secretary to the then housing minister BZ Zameer Ahmed Khan, days before his retirement from service on 31 December 2025.

Justice M. Nagaprasanna passed the order and allowed a petition filed by Mr. Sarfaraz, who challenged the correctness of a First Information Report (FIR) registered against him on December 23, 2025, for allegedly possessing assets in excess of his known sources of income based on the Loyukta Police’s report on his income, assets and liabilities.

The court ruled that the Lokyukta police did not follow the procedure it had developed in 2023 before registering an FIR for allegedly possessing assets beyond known sources of income. The court pointed out that no preliminary investigation was conducted before registering the FIR as mandated in the procedure laid down by the Lokyukta police itself way back in 2023.

IT is coming back

More importantly, the court pointed out that Mr. Sarfaraz had declared all his assets, which were prima facie found by the Lokayukta police to be disproportionate to his known sources of income, in his income tax returns and before the competent authority as acquired under the Karnataka Civil Service (Conduct) Rules, 2021.

Referring to the Supreme Court judgment in Nirankar Nath Pandey, which was relied upon by the High Court to quash a DA’s case against another public servant, Justice Nagaprasanna observed that the Supreme Court held that for assessing cases of disproportionate assets involving government employees, authorities must take into account economic fluctuations and assume that income tax returns are false and that tax returns that are demonstrably correct have been taken into account revenues.

It was argued on behalf of Mr. Sarfaraz that if the Lokayukta police had conducted a preliminary investigation, the facts about the assets, including the income tax returns, would have been clear.

From a rich family

The Lokayukta Police alleged that Mr. Sarfaraz, who was serving as Director of Co-operative Audit and was deputed as Private Secretary to the Minister when the FIR was registered, had amassed assets worth ₹9.42 crore, 135.04% of assets disproportionate to his known income. However, the court noted that except for ₹66,500 in cash, no significant cash was seized during searches conducted at his residences and other places, including bank lockers.

The court was earlier told that the petitioner came from a wealthy family and had no need to accumulate assets beyond his known sources of income. It has been submitted that his grandfather served as a Police Inspector in the pre-independence Madras Presidency and owned several immovable properties. His father was a landowner and held a high government position, while his mother owned prime land, residential plots and houses.

The petition further stated that his younger brother is an independent businessman running a sports training center and riding school and owns several houses and flats and that his sister is married to an IPS officer from Kerala who retired as Director General of Police.

Published – 06 Jul 2026 20:51 IST