Supreme Court: In an appeal against Andhra Pradesh High Court’s decision, whereby, former Andhra Pradesh Chief Minister and leader of Telugu Desam Party, Nara Chandrababu Naidu’s petition under Section 482 of the Code of Criminal Procedure, 1973 (‘CrPC’) to quash the First Information Report (FIR) against him in Skill Development Scam was dismissed, the Division Bench of Aniruddha Bose and Bela M. Trivedi, JJ. delivered a spilt verdict on the interpretation and application of Section 17-A of the Prevention of Corruption Act, 1988, therefore, the matter was placed before the Chief Justice of India to take an appropriate decision to constitute a larger Bench.
Background
The State Government/ A.P. State Skill Development Corporation (‘APSSDC’), agreed to establish Skill Development Centres in different clusters at a cost of Rs. 546,84,18,908/-. A large part of the work was assigned to Skiller Enterprises Private Limited. The training development software including various sub-modules supplied by Skillar to Design Tech were purchased by Skillar from various companies, which allegedly were shell/defunct companies, and they were issuing invoices without providing any services and they formed into a cartel for siphoning public funds tuning to Crores of rupees.
Nara Chandra Babu Naidu, then Chief Minister of the State who had announced the ambitious skill development programme to promote youth employment and entrepreneurship in the State was alleged of playing the key role in the said matter. It was primarily alleged that he indulged in the acts of siphoning off the entrusted Government money and caused a purported loss of 370 crores to the State Exchequer. Naidu was accused of offences under Sections 166, 167, 418, 420, 465, 468, 471, 409, 209, 109 read with Section 120-B and 34 of the Penal Code, 1860 (‘IPC’) and 12, 13(2) read with 13(1)(c) and (d) of the Prevention of Corruption Act, 1988 (‘the PC Act’).
In Nara Chandrababu Naidu v. State of A.P., 2023 SCC OnLine AP 2198, the High Court opined that a mini trial cannot be conducted for petition under Section 482 of the CrPC, when about 140 witnesses have been examined by the CID and the investigation is on fulcrum of attaining finality. The High Court also refused to quash the remand order dated 10-09-2023. Hence, forming the impugned Judgment.
Section 17-A of the PC Act, introduced with effect from 26-07-2018 provides that no police officer is permitted to conduct any enquiry or inquiry or conduct investigation into any offence done by a public servant where the offence alleged is relatable to any recommendation made or decision taken by the public servant in discharge of his public functions without previous approval, of the authority competent to remove the public servant from his office at the time when the offence was alleged to have been committed.
The primary argument by Naidu was non-compliance of Section 17 of the PC Act while implicating him under Sections 12, 13(2) read with 13(1) (c) and (d) of the PC Act. Naidu’s case was that once fault is found with his implication, the entire proceedings before the Special Judge would also collapse, because in such a case, the Special Judge under the PC Act would have acted beyond his jurisdiction. Hence, the remand order would become non-est.
Justice Aniruddha Bose’s Decision
Commencement of Enquiry
On the question that whether the enquiry had commenced by the Director General of Anti-corruption Bureau, Andhra Pradesh’s letter dated 05-06-2018, through which enquiry was ordered into the allegations against APSSDC’s officials, Justice Bose said that he did not agree with the High Court’s finding that a regular enquiry was already initiated on 05-06-2018 before Section 17-A of the PC Act came into operation on 25-07-2018. He opined that a request to conduct an enquiry by itself cannot be the starting point of the enquiry, to bypass the restriction within Section 17A, that an enquiry by a police officer cannot be conducted without the prior approval of the authority specified therein.
Justice Bose also noted that the actual search in the said matter had commenced only in the year 2021, when the DSP in his letter dated 22-02-2021, had stated that the bureau is investigating a regular enquiry pertaining to the allegations in relation to collaboration of APSSDC/AP Government with Design Tech. Therefore, he said that there was obviously a time gap between the date of issue of letter of enquiry and actual date of the commencement of the enquiry. Thus, he held that Section 17A had become operational. He stated that “Section 17A imposes restriction on police officer at the enquiry stage itself, from proceeding against a public servant in relation to any offence alleged to have been committed by him, relatable to any recommendation made or decision taken by such public servant without previous approval of the authorities stipulated in the said Section.”
Whether the protection of Section 17A is applicable to Naidu’s case?
Justice Bose said that Section 17A does not distinguish between the alleged commission of offence prior to 26-07-2018 or post thereof. Thus, he observed that the time of applicability of Section 17A or taking prior approval, is the starting point of enquiry, inquiry, or investigation and not the time of commission of the alleged offence. He said that when Naidu was arrayed as an accused in the FIR through Memo dated 08-09-2021, the Amendment Act, which inserted Section 17A to the PC Act and deleted Section 13(1)(c) and (d), had become operational. However, at the time of the alleged commission of offence, Section 13(1)(c) and (d) were part of the PC Act. Further, he said that the protection or mandate of Section17A would extend, if enquiry, or inquiry, or investigation on the part of the prosecution is triggered off after 26-07-2018.
Justice Bose also interpreted the phrase ‘under this Act’ in section 17A to include offences which were in the PC Act at the time the subject-offences are alleged to have been committed. Therefore, he stated “that Section 17A is prospective in its operation, the material point of time for determining its prospectivity would be the starting time of enquiry or inquiry or investigation.” Justice Bose held that the phrase ‘under this Act’ ought to be relatable to the date of starting of the enquiry, inquiry or investigation and not to the time or date of commission of offence.
Legality of the proceedings without compliance of requirement of previous approval under Section 17-A of the PC Act
Justice Bose referred to Yashwant Sinha v. CBI, (2020) 2 SCC 338, whereby a similar question was also dealt with, and it was emphasized that the first step, of seeking permission of the Government under Section 17-A of the PC Act for investigating the offence must be taken. Placing his reliance on Yashwant Sinha, (supra), Justice Bose held that the steps taken against Naidu under the PC Act ought to be invalidated as the same did not commence with prior approval of the Government as laid down under Section 17A.
Whether striking down the set of offences under the PC Act from the FIR would render the Special Judge’s remand order illegal and non-est?
Justice Bose said that the alleged offences under IPC also relate to the same set of transactions, for which the provisions of the PC Act were also applied. The offences under IPC are not mere ancillary to the offences under the PC Act, hence, the offences under the PC Act were not so dominant that the allegations of commission of the IPC offences would automatically collapse. Therefore, he held that the Special Judge had the jurisdiction to pass the remand order even if the offences under the PC Act could not be invoked at that stage, and the lack of approval of the Government under Section17A would not have rendered the entire order of remand non-est.
Justice Bela M. Trivedi’s Decision
Prospective application of Section 17A
While interpreting Section 17-A of the PC Act, Justice Trivedi emphasized on the object of the Amendment Act, 2018, which is to protect the honest public servants from the harassment by way of inquiry or investigation in respect of the decisions taken or acts done in bonafide performance of their official functions or duties.
She opined that Section 17A, introduced by Amendment Act, 2018, is substantive and not merely procedural in nature. Therefore, she said that it is not applicable retrospectively to the offences like Section 13(1)(c) and 13(1)(d), which have been deleted under the said Amendment Act. Justice Trivedi pointed out that the Amendment Act, 2018 was specifically made applicable with effect from 26-07-2018, hence, the Legislature’s intention was to make the amendments applicable prospectively from a particular date and not retrospectively or retroactively. Keeping the Legislature’s intention behind giving Section 17A prospective effect in view, Justice Trivedi said that any other interpretation of taking it as retrospective or retroactive would lead to an anomalous situation resulting into absurdity in as much as there could not be prior approval of the authorities as contemplated under Section 17A for the offences which have been deleted by the Amendment Act, 2018.
Referring to the object of Section 17A, to protect the honest and innocent public servants from undergoing harassment by the police for the recommendations made or decisions taken in discharge of official functions or duties, Justice Trivedi explained that the object of Section 17A is not to give benefit to the dishonest and corrupt public servants. If any enquiry or inquiry or investigation carried out by a police officer in respect of the offence committed by a public servant is held to be non-est or infructuous by making Section 17A retrospectively or retroactively applicable, the same would not only frustrate the object of the PC Act but also would be counter- productive.
Absence of Government’s/ authority’s approval to conduct enquiry and Quashing of FIR
Justice Trivedi stated that absence of approval before conducting any enquiry or inquiry or investigation into an offence alleged to have been committed by a public servant, could never be the ground for quashing the FIR registered against the public servant or the proceedings conducted against him, more particularly when he is also charged for the other offences under the IPC in respect of the same set of allegations. She also said that the Protection under Section 17A could not be extended to public servant’s acts which prima facie were not in discharge of his official functions or duties and any other interpretation would be tantamount to scuttling the investigation at a very nascent stage.
Registration of FIR in 2021 for offences deleted by Amendment Act, 2018
Justice Trivedi accepted the State’s submission and fully agreed with it, that though the old provision of Section 13 was substituted by the new provision, and though Section 13(1)(c) and 13(1)(d) are no more offences under the amended provision of Section 13, the right of the investigating agency to investigate the crime which took place prior to the amended provision of Section 13, continues under Section 6(c) and (e) of the General Clauses Act, 1897. Relying on M.C. Gupta vs. Central Bureau of Investigation, Dehradun, (2012) 8 SCC 669, Justice Trivedi said that unless disclosed in the new Act or repealing Act, the repeal of an Act would not affect the right of the investigating agency to investigate the offences which were covered under the repealed Act. If the offences were committed when the repealed Act was in force, then the repeal of such Act would neither affect the right of the investigating agency to investigate the offence nor would vitiate or invalidate any proceedings instituted against the accused.
Therefore, Justice Trivedi held that, in the present case, the offences under Section 13(1)(c) and 13(1)(d) were in force when the same were allegedly committed by Naidu. Hence, the deletion of the said provisions and the substitution of the new offence under Section 13 by the Amendment Act, 2018 would not affect the right of the investigating agency to investigate nor would vitiate or invalidate any proceedings initiated against him. Thus, she held that absence of an approval under Section 17A for conducting enquiry, inquiry or investigation of the offences alleged committed by a public servant in purported exercise of his official functions or duties, would neither vitiate the proceedings nor would be a ground to quash the proceedings or the FIR registered against such public servant.
Justice Trivedi agreed with Justice Bose’s opinion that the Special Court was completely within its jurisdiction to pass the remand order in view of the powers conferred upon it under Section 4 and 5 of the PC Act. There was no jurisdictional error committed by the Special Court in passing the impugned order of remand. Further, she held that the High Court impugned order did not suffer from any illegality.
Call for reference to Larger Bench
Considering the different views taken on interpretation of Section 17A, the Bench referred the matter to the Chief Justice of India, to take an appropriate decision for the constitution of a Larger Bench.
[Nara Chandrababu Naidu v. State of Andhra Pradesh, Special Leave to Appeal (Criminal) No.12289 of 2023), Decided on: 16-01-2024]
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