Case BriefsSupreme Court

Supreme Court: The 3-judge bench of Dr. DY Chandrachud*, Vikram Nath and BV Nagarathna, JJ has held that a Preliminary Enquiry is not mandatory in all cases which involve allegations of corruption.

The Court said that in case the information received by the CBI, through a complaint or a “source information”, discloses the commission of a cognizable offence, it can directly register a Regular Case instead of conducting a Preliminary Enquiry, where the officer is satisfied that the information discloses the commission of a cognizable offence.

Holding that the institution of a Preliminary Enquiry in cases of corruption is not made mandatory before the registration of an FIR under the CrPC, Prevention of Corruption Act or even the CBI Manual, the Court said that issuing a direction to that affect will be “tantamount to stepping into the legislative domain.” 

However, it was made clear that holding the aforesaid will not take away from the value of conducting a Preliminary Enquiry in an appropriate case.

“The registration of a Regular Case can have disastrous consequences for the career of an officer, if the allegations ultimately turn out to be false. In a Preliminary Enquiry, the CBI is allowed access to documentary records and speak to persons just as they would in an investigation, which entails that information gathered can be used at the investigation stage as well. Hence, conducting a Preliminary Enquiry would not take away from the ultimate goal of prosecuting accused persons in a timely manner. However, we once again clarify that if the CBI chooses not to hold a Preliminary Enquiry, the accused cannot demand it as a matter of right.”

Important rulings

Lalita Kumari v. Government of Uttar Pradesh, (2014) 2 SCC 1

If the information received discloses the commission of a cognizable offence at the outset, no Preliminary Enquiry would be required. Further, the scope of a Preliminary Enquiry is not to check the veracity of the information received, but only to scrutinize whether it discloses the commission of a cognizable offence.

Union of India v. State of Maharashtra, (2020) 4 SCC 761

The Court reversed the decision of a two Judge Bench in Subhash Kashinath Mahajan v. State of Maharashtra, (2018) 6 SCC 454 [Read more] which had, inter alia, held that “a preliminary enquiry may be conducted by the DSP concerned to find out whether the allegations make out a case under the Scheduled Cases and Scheduled Tribes (Prevention of Atrocities) Act 1989 and that the allegations are not frivolous or motivated”.

The three Judge Bench held that such a direction was impermissible since neither the CrPC nor the Atrocities Act mandate a preliminary inquiry.

“In case a cognizable offence is made out, the FIR has to be outrightly registered, and no preliminary inquiry has to be made (…). The direction would mean that even if a complaint made out a cognizable offence, an FIR would not be registered until the preliminary inquiry is held. In case a preliminary inquiry concludes that allegations are false or motivated, FIR is not to be registered, in such a case how a final report has to be filed in the Court. Direction 79.4 cannot survive for the other reasons as it puts the members of the Scheduled Castes and Scheduled Tribes in a disadvantageous position in the matter of procedure vis-à-vis to the complaints lodged by members of upper caste, for latter no such preliminary investigation is necessary. In that view of the matter it should not be necessary to hold preliminary inquiry for registering an offence under the Atrocities Act, 1989.”

Read more…

Charansingh v. State of Maharashtra,  (2021) 5 SCC 469

An enquiry at pre-FIR stage is held to be permissible and not only permissible but desirable, more particularly in cases where the allegations are of misconduct of corrupt practice acquiring the assets/properties disproportionate to his known sources of income. After the enquiry/enquiry at pre-registration of FIR stage/preliminary enquiry, if, on the basis of the material collected during such enquiry, it is found that the complaint is vexatious and/or there is no substance at all in the complaint, the FIR shall not be lodged.

However, if the material discloses prima facie a commission of the offence alleged, the FIR will be lodged and the criminal proceedings will be put in motion and the further investigation will be carried out in terms of the Code of Criminal Procedure. Therefore, such a preliminary enquiry would be permissible only to ascertain whether cognizable offence is disclosed or not and only thereafter FIR would be registered. Therefore, such a preliminary enquiry would be in the interest of the alleged accused also against whom the complaint is made.

Read more…

[CBI v. Thommandru Hannah Vijayalakshmi, 2021 SCC OnLine SC 923, 08.10.2021]

__________________________________________________________________________________________________

Counsels:

For CBI: Aishwarya Bhati, Additional Solicitor General

For respondents: Senior Advocates Siddharth Luthra and Siddharth Dave


*Judgment by: Justice Dr. DY Chandrachud

Know Thy Judge| Justice Dr. DY Chandrachud

Case BriefsHigh Courts

Chhattisgarh High Court: Sanjay K Agrawal, J. dismissed the petition being devoid of merits.

Facts

The facts of the case are such that the Chhattisgarh State Economic Crime Bureau and Anti Corruption Bureau registered an offence against the petitioner and other persons for offence under Section 13(1)(d) read with Section 13(2) of Prevention of Corruption Act i.e. PC Act and Sections 120B & 420 of the Penal Code, 1860 i.e. IPC and sought sanction from respondent 1 for prosecution against the petitioner herein and other persons under Section 19(1)(b) of the PC Act and Section 197 of Criminal Procedure Code i.e. CrPC. The petitioner herein calls in question legality, validity and correctness of the impugned order dated 15-5-2019 passed by respondent No.1 in exercise of power conferred under Section 19(1)(b) of the Prevention of Corruption Act, 1988 (for short, ‘the PC Act’) read with Section 197 of the Code of Criminal Procedure, 1973 (for short, ‘the CrPC’) granting sanction for prosecution against him for offence under Section 13(1)(d) read with Section 13(2) of the PC Act and Sections 120B & 420 of the IPC.

Issue

The sanction for prosecution ought to have been placed before the Sub- Committee of the Cabinet, as the Administrative Department has not accorded sanction for prosecution of the petitioner modified by subsequent circular. Since that procedure was not followed by respondent 1, the order granting sanction is illegal and liable to be set-aside

Counsel for the petitioners submitted that the order granting sanction is illegal, contrary to law and deserves to be set-aside because if there is difference of opinion between two Departments of the State i.e. parent Department, here Water Resources Department and the Law Department, then the procedure laid down in the circular and its clarification issued by the State Government is required to be followed. It was further submitted that sanction can only be obtained in coordination with the Minister of Council of Political Affairs or with its concurrence and no such procedure has been followed in the present case.

The Court perused section 19 of PC Act and stated that previous sanction for prosecution is required in respect of a public servant who is employed and is not removable from his office save by or with the sanction of the State Government. The Court observed that the communication of alleged disagreement with respect to grant of sanction qua the petitioner has been made by the Chief Engineer, Water Resources Department, Raipur to the Secretary, Government of Chhattisgarh, Water Resources Department dated after the order granting sanction for prosecution under Section 19 of the PC Act and Section 197 of the CrPC was passed, whereas the disagreement was required to be expressed and to be sent by the Administrative Department before the question of sanction is considered by Respondent 1 herein.

The Court relied on judgment Subramanian Swamy v. Manmohan Singh, (2012) 3 SCC 64 and observed despite memo and reminder received by the Administrative Department – respondent 2, no response was served to respondent 1 who is the competent authority to consider the issue of grant of sanction and therefore in absence of any disagreement, the competent authority to grant sanction being the Department of Law & Legislative Affairs has proceeded to consider the matter and issued order granting sanction for prosecution against the petitioner and others. It was further established that despite memo dated 22-3-2019 reiterated by reminder dated 25-4- 2019, the Administrative Department kept pin-drop silence over the matter.

The Court further relied on judgment State of Madhya Pradesh v. Virender Kumar Tripathi, (2009) 15 SCC 533 and observed that interdicting a criminal proceeding midcourse on ground of invalidity of the sanction order will not be appropriate unless failure of justice has occasioned by any such error, omission or irregularity in the sanction and such failure of justice can be established not at the stage of framing of charge but only after the trial has commenced and the evidence is led.

The Court held “ultimately, finding no opinion of the Administrative Department (respondent 2) either way, the Department of Law & Legislative Affairs being the authority competent to grant sanction has rightly considered the issue and granted sanction for prosecution against the petitioner”.

[KK Vashishta v. State of Chhattisgarh, 2021 SCC OnLine Chh 621, decided on 15-03-2021]


Arunima Bose, Editorial Assistant has reported this brief.


 Appearances:

For Petitioner: Mr. B.P. Sharma and Mr. M.L. Sakat

For Respondents / State: – Mr. Jitendra Pali and Mr. Ravi Kumar Bhagat

Case BriefsSupreme Court

Supreme Court: The bench of MM Shantanagoudar* and Vineet Saran, JJ has held that Section 195(1)(b)(i) CrPC will not bar prosecution by the investigating agency for offence punishable under Section 193 IPC, which is committed during the stage of investigation. This is provided that the investigating agency has lodged complaint or registered the case under Section 193, IPC prior to commencement of proceedings and production of such evidence before the trial court. In such circumstance, the same would not be considered an offence committed in, or in relation to, any proceeding in any Court for the purpose of Section 195(1)(b)(i) CrPC.

Background and issues raised

A case was registered against the Appellant/Accused No. 1, who was working as Regional Manager (South) at Chennai with the Rashtriya Ispat Nigam Ltd, under Section 120B read with Sections 420, 467, 468 and 471 IPC; and Section 13(2) read with Section 13(1)(d) of the Prevention of Corruption Act, 1988 (PC Act).

In the present case, the Accused Nos. 2 and 3 had colluded with Appellant/Accused No. 1 to create a false sale deed, and gave false explanation of escrow arrangement amongst the three parties, to justify how the seized currency came to be in the Appellant’s possession. This was done to exonerate the Appellant/Accused No. 1 and recover the seized currency at the stage of investigation itself.

This gave rise to the question before the Court as to

  1. Whether Section 195(1)(b)(i), CrPC bars lodging of case by the investigating agency under Section 193, IPC, in respect of offence of giving false evidence which is committed at the stage of investigation, prior to production of such evidence before the Trial Court?
  2. Whether an offence under Section 193, IPC committed at the stage of investigation, prior to production of the false evidence before the Trial Court by a person who is not yet party to proceedings before the Trial Court, is an offence “in relation to” a proceeding in any court under Section 195(1)(b)(i), CrPC?
  3. Whether the words “stage of a judicial proceeding” under Explanation 2 to Section 193, IPC can be equated with “proceeding in any court” under Section 195(1)(b)(i), CrPC?

Analysis by the Court

Import of the Words “in relation to” in Section 195(1)(b) (i) CrPC

The construction of the words “in relation to” must be controlled by the overarching principle   applicable to Section 195(1)(b), CrPC i.e., even if the offence is committed prior to giving of the fabricated evidence in court, it must have a direct or reasonably close nexus with the court proceedings.

Section 195(1)(b)(i), CrPC may be attracted to the offence of fabricating false evidence prior to its production before the Court, provided that such evidence is led by a person who is party to the court proceedings, for the purpose of leading the Court to form a certain opinion based on such evidence. The bar against taking of cognizance under Section 195(1)(b)(i) may also apply where a person who is initially not a party to the court proceedings fabricates certain evidence, and

1) subsequently becomes a party and produces it before the Court; or;

2) falsely deposes as a witness before the Court on the strength of such evidence,

for the purpose of causing the Court to form an erroneous opinion on a point material to the result of the proceedings.

However, where a person fabricates false evidence for the purpose of misleading the investigating officer, this may not have any direct nexus with the subsequent court proceedings.

“There is an indirect nexus inasmuch as if the investigating agency does not suspect any wrongdoing, and the Court commits the case for trial, the evidence will be produced for the Court’s perusal and impact the judicial decision-making process. However, it may be equally possible that even if the fabricated evidence appears sufficiently convincing, the investigating agency may drop proceedings against the accused and divert its time and resources elsewhere. Therefore, the offence may never reach the stage of court proceedings. Further, if it subsequently comes to light that the evidence was falsely adduced, it will be the investigating agency which will suffer loss of face and be forced to conduct a fresh investigation.”

Hence, though the offence is one which affects the administration of justice, it is the investigating agency, and not the Court, which is the aggrieved party in such circumstance.

“Just like a private party who has been a victim of forgery committed outside the precincts of the Court, the investigative agency should not be left remediless against persons producing false evidence for the purpose of interfering with the investigation process. Moreover, the present case concerns offences alleged to have been committed under the PC Act. Public interest and the reputation of the State will suffer significant harm if corrupt public servants are facilitated by third parties in hiding their assets from scrutiny. Hence any interpretation which negates against the speedy and effective trial of such persons must be avoided.”

Whether “stage of a judicial proceeding” under Explanation 2 to Section 193 IPC is synonymous   with “ proceeding in any court” under Section 195(1)(b)(i) CrPC?

Section 195(1)(b) is meant to restrict the right to make complaint in respect of certain offences to public servants, or to the relevant Court, as they are considered to be the only party who is directly aggrieved or impacted by those offences. Furthermore, for the purpose of Section 195(1)(b)(i), CrPC, there must be an intention on part of the alleged offender to directly mislead the Court into forming a certain opinion by commission of offence under Section 193 IPC.

“Though a criminal investigation is certainly a stage of a judicial proceeding insofar as it may culminate in issue of process and trial against the accused, it would not be a proceeding in relation to a certain Court under Section 195(1)(b) (i), CrPC before the Court has even taken judicial notice of such investigation.”

Section 2(i) CrPC defines “judicial proceeding” as including any proceeding in the course of which evidence is or may be legally taken by oath. The investigation under the PC Act was admittedly a stage of a judicial proceeding by virtue of Explanation 2 to Section 193 IPC. However, neither was the fabricated evidence in the present case given on oath before the investigating officer, nor is the investigating authority under the PC Act deemed to be a “court” for the purpose of Section 195(1) (b), CrPC.

In the present case, it is not the Trial Court but the Investigating authority/agency which has been directly impacted due to fabrication of evidence by the Appellants/accused.

“The Appellants’ intention was not to mislead the Trial Court, at least not at the first instance. Rather, their goal was to ensure that the Appellant/Accused No. 1 was cleared of wrongdoing at the stage of investigation itself. It was after being charged under Section 193 IPC, that the Appellants/accused reiterated the fictitious escrow arrangement story before the Trial Court so as to prove their innocence. Hence it cannot be said that the offence under Sections 120B read with 193 IPC was committed by the Appellants “in relation to” a proceeding in a court under Section 195(1)(b)(i), CrPC.”

Thus, the investigation conducted by the agency under the PC Act cannot be equated with a proceeding in a court of law under Section 195(1) (b)(i) CrPC, though it is deemed to be a stage of a judicial proceeding under Section 193, IPC.

“Had this been a case wherein the Investigating agency had not developed any suspicion against Accused Nos. 2 and 3, and the Trial Court had subsequently discovered the subterfuge caused by them, we may have taken a different view.”

[Bhima Razu Prasad v. State, 2021 SCC OnLine SC 210, decided on 12.03.2021]


*Judgment by: Justice MM Shantanagoudar

Appearance before the Court by:

For Appellants: Senior counsel Basava Prabhu Patil, and counsels Amit Anand Tiwari and B. Karunakaran

For State: Additional Solicitor General Aishwarya Bhati

Case BriefsSupreme Court

Supreme Court: Setting aside the conviction of a man under Sections 7 and 13(2) read with 13(1)(d) of the Prevention of Corruption Act, 1988, the 3-judge bench of Ashok Bhushan, R. Subhash Reddy and MR Shah has reminded the Courts to take utmost care in scanning the evidence before recording conviction under the provisions of Prevention of Corruption Act.

“Once conviction is recorded under provisions of Prevention of Corruption Act, it casts a social stigma on the person in the society apart from serious consequences on the service rendered.  At the same time it is also to be noted that whether the view taken by the trial court is a possible view or not, there cannot be any definite proposition and each case has to be judged on its own merits, having regard to evidence on record.”

In the present case, the accused, working as Sanitary Inspector in Madurai Municipal Corporation, was charge-sheeted for the offence under Sections 7, 13(2) read with 13(1)(d) of the Act for an amount of Rs.500/¬ and a cell phone as illegal gratification from one Thiru. D. Gopal, who was working as Supervisor in a Voluntary Service Organisation called Neat And Clean Service Squad (NACSS), which was given sanitation work on contract basis in Madurai Corporation.

While the Trial Court acquitted the accused, the Madras High Court convicted him. It was argued by the accused that the well reasoned judgment of the trial court, which was rendered by appreciating oral and documentary evidence on record, was reversed by the High Court without recording valid and cogent reasons.

Having regard to material contradictions that were put forth before the Court, the Supreme Court noticed that acquittal is a “possible view”. Even assuming another view is possible, same is no ground to interfere with the judgment of acquittal and to convict the appellant for the offence alleged.

The trial court has disbelieved witnesses by recording several valid and cogent reasons, but the High Court, without appreciating evidence in proper perspective, has reversed the view taken by the trial court.  Further, the High Court also has not recorded any finding whether the view taken by the trial court is a “possible view” or not, having regard to the evidence on record.

“Though the High Court was of the view that PW-2, 3 and 5 can be believed, unless it is held that the view taken by the trial court disbelieving the witnesses is not a possible view, the High Court ought not have interfered with the acquittal recorded by the trial court.”

In view of the material contradictions, the prosecution has not proved the case beyond reasonable doubt to convict the appellant. It is equally well settled that mere recovery by itself cannot prove the charge of the prosecution against the accused.

“Mere recovery of tainted money, divorced from the circumstances under which such money and article is found is not sufficient to convict the accused when the substantive evidence in the case is not reliable.”

The Court was, hence, of the view that the demand for and acceptance of bribe amount and cell phone by the appellant, is not proved beyond reasonable doubt. Having regard to such evidence on record the acquittal recorded by the trial court is a “possible view” as such the judgment of the High Court is fit to be set aside.

[N. Vijayakumar v. State of Tamil Nadu, 2021 SCC OnLine SC 53, decided on 03.02.2021]


*Justice R. Subhash Reddy has penned this judgment

Appearances before the Court by

For accused: Senior Advocate S. Nagamuthu

For State: Advocate M. Yogesh Kanna

Case BriefsSupreme Court

Supreme Court: Stating that it has some reservation in respect of the observation and findings recorded by the 3-judge bench of former CJ HL Dattu, V Gopala Gowda and Amitava Roy, JJ in P. Satyanarayana Murthy v. District Inspector of Police, State of Andhra Pradesh (2015) 10 SCC 152, the bench of R. Banumathi and R. Subhash Reddy, JJ has referred the following to a larger bench:

“The question whether in the absence of evidence of complainant/direct or primary evidence of demand of illegal gratification, is it not permissible to draw inferential deduction of culpability/guilt of a public servant under Section 7 and Section 13(1)(d) read with Section 13(2) of Prevention of Corruption Act, 1988 based on other evidence adduced by the prosecution.”

Satyanarayana Ruling:

In the said judgment, the court proceeded under the footing that failure of the prosecution to prove the demand for illegal gratification due to the death of complainant would be fatal to the prosecution case and recovery of the amount from the accused would not entail his conviction. The Court, in the said case, held:

“to hold on the basis of the evidence on record that the culpability of the appellant under Sections 7 and 13(1)( d )(i ) and ( ii) has been proved, would be an inferential deduction which is impermissible in law.”

Appellant’s contention based on the Satyanarayana ruling:

Mere proof of receipt of money by the accused in the absence of proof of demand of illegal gratification is not sufficient to prove the guilt of the accused.

“when the complainant passed away, primary evidence of demand is not forthcoming and when the prosecution could not establish the demand by such primary evidence, the conviction of the appellant cannot be sustained.”

State’s contention against the Satyanarayana Ruling:

In Satyanarayana, the court did not notice the line of judgments and the consistent view taken by this Court in various decisions that demand can be proved either by direct evidence or by drawing inference from other evidence like evidence of panch witness and the circumstances.

Court’s observation:

After referring to a number of judgments where accused was convicted even when the evidence of complainant was not available either due to death of complainant or where the complainant had turned hostile, the Court showed reservations on the judgment. It said:

“The direct or primary evidence of demand may not be available at least in three instances:- (i) where the complainant is dead and could not be examined; (ii) complainant turned hostile; and (iii) complainant could not be examined either due to non-availability or other reasons. Direct proof of demand may not be available in all the above instances but from the evidence of panch witness, acceptance of money was proved by Phenolphthalein Test and by raising presumption under Section 20 of the Act, it is permissible to draw inference to prove the demand.”

The matter was, hence, referred to a larger bench.

[Neeraj Datta v. State, 2019 SCC OnLine SC 296, decided on 28.02.2019]

Case BriefsSupreme Court

Supreme Court: Explaining the Section 19 of the Prevention of Corruption Act, 1988, the Bench of Ranjan Gogoi and P.C. Pant, JJ held that the sanction cannot be held invalid only for the reason that in the administrative notings, different authorities have opined differently before the competent authority took the decision in the matter.

In the present case where the appellant, an IRS officer, was involved in the disproportionate assets matter, the CVC had recommended that the sanction for prosecution be granted, however, the Finance Department later referred the matter to Department of Personnel and Training (DoPT) which observed that administrative warning could be issued to the appellant for not intimating the transactions to Finance Department. The DoPT later conveyed that insufficiency of evidence can be tested in the court of law and sanction for prosecution can be granted. Finally, the Finance Department granted sanction for prosecution of the appellant.

The Court further said that what is required under Section 19 of the Prevention of Corruption Act, 1988 is that for taking the cognizance of an offence, punishable under Sections 7, 10, 11, 13 and 15 of the Act committed by the public servant, is necessary by the Central Government or the State Government, as the case may be, and in the case of a public servant, who is neither employed in connection with affairs of the Union or the State, from the authority competent to remove him. It was further explained that sub-section (2) of Section 19 of the Act provides that where for any reason whatsoever any doubt arises as to whether the previous sanction, as required under sub-section (1) should be given by the Central Government or the State Government or any authority, such sanction shall be given by that Government or authority which could have been competent to remove the public servant from his office at the time when the offence was alleged to have been committed. [Vivek Batra v. Union of India, 2016 SCC OnLine SC 1146, decided on 18.10.2016]