Case BriefsHigh Courts

Madras High Court: Addressing the issue of the growing menace of job racketing and tackling the unemployment problem, Division Bench of N. Kirubakaran and S. Vaidyanathan, JJ, suggested the Central and State Government promote entrepreneurs and create self-employment opportunities for youth so that the future of this country can be safeguarded from falling prey to such money mongering vultures.

Instant suo motu writ petition was filed to direct the respondents 1 to 10 to conduct a thorough enquiry and register an FIR so as to proceed against respondents 11 to 15 for preparing and sending fake interview/appointment letters with an intention to defraud the innocent public with an oblique motive and to make unlawful gain and to proceed in accordance with law.

How did the present issue crop up?

An interview call letter allegedly sent in the name of respondents portrayed that the letter had been issued with an ulterior motive to defraud the public at large. There was no genuineness in the letter in the commitment made by the company and their intention appeared that they wanted to collect money from jobless persons, by falsely promising to secure jobs in private companies.

Several reports were filed under the direction of Court.

High Court expressed that, the FIR in the present case was registered as early as 20-10-2017. Even though a lady accused was nabbed, remanded to custody and subsequently, released on bail by the Court below, still, the investigation moved in a snail-paced and dawdling manner, as the whereabouts of other co-accused were not traceable.

Bench opined that the respondent-police instead of spending time in search of other accused and keeping in abeyance a criminal case without any progress for quite a long time, formalities, such as filing of charge sheet before the Jurisdictional Magistrate concerned, if not already filed, cooperating for smooth conduct of the Trial in the case, etc.

Court also stated that one of us (Justice S. Vaidyanathan), while sitting singly, dealt with the issue of fake employment elaborately in the case of A. Perumal v. State, (2015) 2 Mad LJ (Crl) 669, observed as follows:

“21. The very term “unemployment” will sound the death knell for the future of the youth of this nation. Every individual would like to stand on his own legs to avert the reverberations of the said word “unemployment”. Such untiring pursuit for employment by the youth is taken advantage of by certain sections. 

  1. It is unfortunate that, now-a-days, everywhere in the country, bogus manpower consultant agencies and fake recruitment agencies are mushrooming with the main illegal object of luring the unemployed youth with employment in government sectors as well as in foreign countries. The youth too, without knowing the hidden agenda, are falling prey to such temptations of lucrative jobs and paying huge amounts even by selling the properties held by their families or availing loans from financial institutions with high rate of interest. While in some cases, the consultancies or agencies would disappear overnight with the amount collected from the victims, in some other cases, they used to issue fake appointment letters to the victims, who would know about the fraud played on them only at the time of joining the post. If ultimately, he is cheated, his entire future will be in peril and it is not easy to restore normalcy in life by overcoming from the situation. In my firm view, these white-collar crimes, which have drastic effects, should be dealt with iron hands and severe punishment should be awarded to the culprits. The innocent persons who, later realized that they were cheated, used to approach the concerned police only and ventilate their grievances by lodging the complaints and request to apprehend the persons and recover the amount.”

 Court elaborated more on the scams stating that,

Of late, several unemployed youths are being cheated by job racketeers and anti-social elements, especially taking advantage of the present pandemic situation, where thousands of people have lost their jobs. The gangs at first target credulous unemployed youth and lure them with attractive job offers both at Central and State Governments and some times in reputed private Organizations.

The method of minting money by utilizing the unemployment problem is mushrooming in the recent past and though the amount sought to be transferred can be meagre, it will get doubled or multiplied, when thousands of people transfer the amount in their favour.

Bench noted an unpleasant incident that took place in the High Court premises that an accused posing himself to be a staff of particular section, collected monies from various persons in the garb of securing jobs in the Madras High Court.

High Court added that, persons, who were cheated started visiting Raman, who had been working in the High Court and several enquiries were made about his integrity. The real Raman, upon sensing fraudulent act of some unknown accused, lodged a complaint with the Police to prove his innocence, even though he was neither a victim nor connected with such collection of amount at all.

Based on the above-stated complaint, a real culprit was arrested, who, by way of impersonation and taking advantage of the similarity in name, cheated several persons as per his own confession statement before Police and the said case is under progress now, that too, after intervention of a Judge (as otherwise, the case would have been thrown to dustbin) and in the said case, there was also a cloud of suspicion of involvement of a Head Constable/Writer working in the Police Department itself, as pointed out by the Complainant.

Further, elaborating more on its conclusion, Court stated that appropriate Governments should think of periodically conducting awareness programmes to encourage self-employment schemes.

“….every unemployed youth will thrive for getting a Government job, but at the same time, it should be borne in mind that their young age should not be wasted in equipping themselves and preparation for Government jobs, instead they can create their own new businesses and job opportunities through self-employment.”

In view of the above discussion, suo motu writ petition was disposed of.

It is made clear that the progress of the investigation, trial, arrest of co-accused, etc., shall have to be intimated to the Registrar Judicial of this Court every now and then, as a serious scam of job racketing is involved in this case and a fake interview call letter has been issued in the name of a Sitting Judge of this Court.

Matter to be listed in February 2022 for reporting compliance. [Ministry of Human Resources, In re., 2021 SCC OnLine Mad 2947, decided on 19-08-2021]


Advocates who appeared in this case:

For R1: M/s. M.E. Saraswathy, SPC

For R2 to R10 : Mr. J.C. Durairaj Govt. Advocate

Case Briefs

Supreme Court: The Division Bench of L. Nageswara Rao and S. Ravindra Bhat*, JJ., dismisses the appeal initiated by the accused contractors in Integrated Housing and Slum Development corruption case. The Bench observed,

“The constructions, according to the reports, were sub-standard – in respect of 100 such houses, so severe that the units were unusable. The main objective of providing housing to 1206 eligible and deserving families remains unfulfilled despite expenditure of substantial amounts.”

Factual Fulcrum

The criminal Public Interest Litigations were filed by the respondents seeking directions to the Union of India, the State of Maharashtra, the Maharashtra Housing and Urban Development Authority (MHADA) and state officials to initiate criminal proceedings against the responsible officers and office bearers of Municipal Council, Naldurg and the contractors concerned for misappropriation of government funds in implementation of the housing scheme in the municipality.

An Integrated Housing and Slum Development Programme (IHSDP) was initiated by the Union Government through the State Government, under the “Jawaharlal Nehru National Urban Renewal Mission” for providing basic services to the urban poor including affordable prices, improved housing, water supply, sanitation, wherein the Maharashtra Government had appointed MHADA as the nodal agency.

The petitioners-respondents alleged that the quality of work carried out by the appellants was very poor and the officials (i.e. MHADA, municipality, etc.) did not inspect or supervise the work, and did not submit the quarterly reports as required under the scheme. It was submitted that the municipality diverted funds meant for the said development project, for other works as the observation made by technical team showed that the municipal council made an excess payment of Rs. 2,43,79,017/- to the contractors as compared to the work done. The allegations were also made with regard to failure to complete the project, and various other omissions were highlighted.

Findings of the High Court

Observing the dereliction of duties on the part of the authorities and certain other irregularities, the High Court had directed the Divisional Commissioner to take actions to its logical end as expeditiously as possible. Pursuant to the direction of the High Court and the report of the technical team the Collector directed the Municipal Council to recover the excess amount paid to the contractors, and blacklist them from Government work, to initiate criminal prosecution against the person(s) who had committed the irregularities, and lastly allot the repairable houses.

Analysis and Conclusion

Noticing that the appellants were all involved as persons or authorized individuals, acting on behalf of entities that were awarded the contract of construction and completion of the housing units, pursuant to the scheme, and that the spot inspection report alleged that they had not performed their task, the made the following observations:

Effect of Delay in Giving Reasoning of the Judgment by the High Court

Rejecting the first grievance of the appellants that the reasoning for the impugned judgment was given and published long after its operative portion was pronounced, i.e. a year and over three months which had prejudiced their case, the Bench stated that though it is clear that the High Court’s order, against which an aggrieved litigant has a right to approach in appeal, under special leave jurisdiction should contain reasons without which it would be well-nigh impossible to exercise that right of seeking special leave, to that extent, the appellants’ grievance was held to be justified, however, the Bench denied to hold that the absence of reasons struck at the legitimacy of the impugned judgment. The Bench stated,

“…prejudice stood off-set with the interim orders of this court, which recognized the piquancy of the situation, and directed stay of further action against the appellants.”

However, the Bench deprecated the High Court’s conduct in not furnishing reasons, either at the time of pronouncement of the operative part of the judgment, or before the commencement of the next working day (of the court).

Motive of PIL

The appellant’s next challenge to the impugned judgment emphasized the need to keep out “busybodies” who “have no interest in matters of public interest” on the ground that the petitioners-respondents had personal motive as they were former Councillors of the municipality. Rejecting the contention of the appellants, the Bench expressed,

“The cause espoused by the said individuals was undoubtedly one of public interest, because it concerned housing for the economically disadvantaged sections of society, in such great numbers.”

The scheme was meant to benefit thousands of persons, and over a thousand housing units were to be constructed and allotted to the beneficiaries. Therefore, in view of the inquiries and the reports, the Bench held that the initiation of public interest proceedings was justified even if the public interest litigants’ motives were ambiguous, or not immediately bona fide, that could not have led to dismissal of the writ petition, before the High Court.

Right to be Heard

Lastly, rejecting the main arguments of the appellants that criminal proceedings had been initiated against them even though they were not heard in the public interest proceedings, and that being adverse to them the judgment was vitiated on account of their non-participation, the Bench opined that the High Court disposed of the PILs directing the Divisional Commissioner to take appropriate steps to its logical end as expeditiously as possible, making it evident that the High Court did not by itself direct initiation of investigation nor did it direct registration of an FIR, hence, the appellants were not required to be on party array. The Bench emphasised,

“Whilst the reasoning for the impugned judgment was undoubtedly published after a long and unexplained delay, the effect of its operative directions was not to per se prosecute.”

Moreover, the constructions were sub-standard – in respect of 100 such houses, so severe that the units were unusable and dilapidated which rendered the main objective of providing housing to 1206 eligible and deserving families unfulfilled despite expenditure of substantial amounts.

Hence, rejecting the argument of the appellants that they ought to have been heard even before action was initiated as unsound, since, according to the decision of the Constitutional Bench in Lalita Kumari v. Govt. of U.P., if there are allegations with respect to commission of cognizable offences, brought to the notice of the police authorities, ordinarily an FIR has to be lodged.

Verdict

Lastly, noticing that High Court did not comment on whether the allegations were true or whether the submissions on behalf of the petitioners justified their conduct or omission, and that the FIR was registered by the police following the imperative nature of the law declared in Lalita Kumari where it was held that a preliminary enquiry ordinarily is to be eschewed whenever cognizable offences are reported, the Bench dismissed the appeals.

[Shaikh Ansar Ahmad Md. Husain v. State of Maharashtra, 2021 SCC OnLine SC 867, decided on 05-10-2021]

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Kamini Sharma, Editorial Assistant has put this report together 

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Appearance by:

For the Appellants: Shyam Divan, Senior Advocate


*Judgment by: Justice S. Ravindra Bhat 

Know Thy Judge| Justice S. Ravindra Bhat

Case BriefsHigh Courts

Bombay High Court: The Bench of Prakash D. Naik, J. cancelled the bail granted to actor and businessman, Sachin Joshi in slum rehabilitation scam. The Bench held,

“The Special Court had granted permanent bail on medical grounds. However, on the basis of materials on record, no case for granting permanent bail was made out.”

The Directorate of Enforcement (ED) had assailed the order of PMLA Court whereby the Special Court had granted permanent bail to the respondent on medical grounds. Alleging the order to be perverse, the ED contended that the Special Judge ought not to have granted bail to the respondent.

Reportedly, the respondent, Sachin Joshi had helped the promoters of Omkar Group to divert Rs. 87-crore in Slum Rehabilitation Authority case.

Noticeably, the said grant of bail was kept in abeyance by the order of High Court and directions were issued to the J. J. Hospital to constitute a medical board comprising of Neurologist, Endocrinologist and general physician to assess medical condition of the respondent. However, due to non-availability of expert and experienced endocrinologist at J. J. Hospital, the endocrinology examination of the patient could not be done. Later on, as the respondent was tested Covid positive, he had been shifted to isolation ward and the directions of performing endocrinology or CT scan could not be complied. The above report submitted by J. J. Hospital revealed that the respondent was presented with anxiety episodes, abdominal pain, loose stools and rectal bleeding. History referred as bronchial asthma.

In the light of factual analysis as stated above, the Bench observed that, the respondent could have been granted temporary bail to undergo tests and instant treatment if required. However, the Special Court had granted him permanent bail on medical grounds. The Bench opined that on the basis of material on record, no case for granting permanent bail was made out.

Hence, the bail order of Special Court was modified and the respondent was granted temporary bail for a period of two months with liberty to seek treatment in private hospital. The respondent was directed to deposit personal bond of Rs.5,00,000/-(Rupees Five Lakhs Only) with one or more solvent sureties. Further, the Bench directed the respondent to deposit his passport to ED and report before it (ED) once a fortnight.

[Directorate Of Enforcement v. Sachin Joshi, 2021 SCC OnLine Bom 686, decided on 05-05-2021]


Kamini Sharma, Editorial Assistant has put this report together

Appearance before the Court by:

For the Applicant: SPP Hiten Shyamrao Venegaokar

For the State: APP Anamika Malhotra
For the Respondent: Sr. Adv. Aabad Ponda, Adv. Sujay Kantawalla, Adv. Subhash Jadhav, Adv. Omprakash Parihar, Adv. Neha prashant, Adv. Amit Patil and i/b. Parinam Law Associates

Hot Off The PressNews

Supreme Court: The Court has declined to stay the investigation by the Central Bureau of Investigation (CBI) into the alleged involvement of some PMO officials in the coal scam case against Jindal Steel.

The CBI had on January 5 registered another case in the coal block allocation scam, which took place during 1993 and 2005. The case was registered against JSW Ispat Steel Limited, then Nippon Denro Ispat Limited (NDIL), and some unknown public servants. According to FIR, the Ministry of Coal at the time had allocated the coal block to NDIL, which was not in line with the notification issued for the coal block to be allocated to private companies.

The CBI said that the Coal Ministry had issued a notification that allowed a company to have two subsidiary companies, with one running a power plant and
the other for mining coal exclusively for the plant. However, the arrangement resulted in the coal block to be run by the Central India Power Company Limited (CIPCO), a company set up by the Ispat Group, with another company — Central India Coal Company Limited (CICCL) — would be mining the coal, while the Ispat Urja Limited owned 26 per cent equity capital in both the firms.

The CBI further alleged the NDIL was allocated the Khiloni Block even after several screening committees agreed not to put it up for allocation. The NDIL FIR pertains to the blocks allocated to it from 1996 to 1998. The preliminary enquiry in the case covered the allocation of 24 coal blocks during the period of 1996-2005. The preliminary enquiry (PE) was started in 2012 based on a complaint by seven MPs including Sandeep Dikshit, which was converted into an FIR on December 31, 2019.

(Source: ANI)

Hot Off The PressNews

Supreme Court: After UPA Chairperson Sonia Gandhi and Congress president Rahul Gandhi sought adjournment of appeals challenging the Income Tax department’s decision to re-open tax assessment related to the National Herald and Young India transactions, the Court has fixed April 23 as the date of next hearing in the case.

The Delhi High Court had last year rejected the plea by the Gandhis challenging the IT notice seeking tax reassessment for the
financial year 2011-2012. The reassessment notice for 2011-2012 had been issued by the department in March 2018.
The I-T department had told the High Court that the All India Congress Committee had transferred funds to the tune of Rs 99 crore to Associate Journal Ltd, adding that Rahul Gandhi had willfully chosen to not disclose the fact that he held the director’s post at Young India.
However, Rahul Gandhi’s counsel asserted that the Congress President did not receive any income from the source, and
hence is not liable for any tax.

The National Herald scam is an ongoing case filed in 2012 by Bharatiya Janata Party (BJP) leader Subramanian Swamy against Sonia, Rahul, their companies and associates. He alleges that Associated Journals Limited (AJL) took an interest-free loan of ?90.25 crore (US$13 million) from Indian National Congress.

(Source: ANI)

Hot Off The PressNews

Supreme Court: The 3-judge bench of Dipak Misra, CJ and AM Khanwilkar and Dr. DY Chandrachud, JJ refused to grant Karti Chidambaram, the son of former Union minister P Chidambaram, interim protection from arrest by the Enforcement Directorate (ED) in an alleged money laundering case related to INX Media and sought a response from ED.

The Court had, on February 23, refused to stay the summons issued by the ED against Karti Chidambaram — who is presently in CBI custody in the INX Media money laundering case after the CBI said he was “not a common criminal” and his plea for quashing the notice was “a guise for an anticipatory bail plea”. In his fresh writ petition, Karti Chidambaram has challenged the summons on the ground that the ED has no jurisdiction to issue such notices based on the FIR lodged by the CBI.

The ED had registered a case against him and others in May last year. It registered an Enforcement Case Information Report (ECIR), the ED’s equivalent of a police FIR, against the accused named in a CBI complaint. These included Karti Chidambaram, INX Media and its directors, Peter and Indrani Mukerjea. An FIR, filed on May 15 last year, had alleged irregularities in the Foreign Investment Promotion Board (FIPB) clearance to INX Media for receiving Rs 305 crore in overseas funds in 2007 when P Chidambaram was Union finance minister.

The Court will now hear the matter on 08.03.2018.

Source: PTI

Case BriefsSupreme Court

Supreme Court: Looking into the matter reflecting the manner of getting excessive number of shares in an irregular manner, adversely affecting the small investors i.e. the Retail Individual Investors (RII), the Court held that Securities and Exchange Board of India Act, 1992 has been enacted to ensure that the Stock Exchanges of the country and the persons connected therewith do not indulge themselves into illegalities or irregularities and the functionaries under the Act have to see that no financial scams take place in the matters relating to issue or transfer of shares, management of Stock Exchange, etc.
In the present case, it was brought into the notice of SEBI that several serious irregularities/illegalities had been committed by some persons so as to corner shares of the said companies by adopting certain unscrupulous, immoral and improper methods not known to the law, which had not only affected the RII but had also an effect on the share market because such dealings by certain greedy persons would adversely affect the faith of a common man in the functioning of the share market. It was noticed that 553 demat account holders sold their shares through a broker or otherwise at a price below the market value. Considering that no man of prudence would enter into such transaction, the Whole Time Member of SEBI, upon investigation, came to the conclusion the demat accounts were signed by same persons with different spellings of their names and in different manners. It was also noticed that Number of demat account were having same address and that too, care of someone else and this makes genuineness of the account holders and the transactions doubtful.
The bench of A.R. Dave and R.Banumathi, JJ also rejected the contention that no Retail Individual Investor had made any complaint to the SEBI and held that the SEBI need not act only on the basis of a complaint received. If from its independent sources, the SEBI, after due enquiry comes to know about some illegality or irregularity, the SEBI has to act in the manner as it acted in the instant case. It was held that the entire case was decided by the Whole Time Member of the SEBI after keeping in mind the object of the Act. [SEBI v. Opee Stock-Link Ltd, 2016 SCC OnLine SC 687, decided on 11.07.2016]

Case BriefsSupreme Court

Supreme Court: The matter where the appellants had challenged the order cancelling the admissions to Medical Institutes in the wake of the VYAPAM Scam, has been placed before the Chief Justice of India owing to the split decision given by the bench of J. Chelameswar and A.M. Sapre, JJ on the issue that whether Article 142 of the Constitution be invoked in order to allow the appellants to complete their education to satisfy the demands of justice as the future of 634 students was at stakes.

Chelameswar, J, considering that the knowledge of these appellants would be simply rendered useless for the society in the sense their knowledge cannot be utilized for the welfare of the society, said that the appellants be allowed to complete their education. However, he added that it would serve the larger public interests, by making the appellants serve the nation for a period of five years as and when they become qualified doctors, without any regular salary and attendant benefits of service under the State, nor any claim for absorption into the service of the State subject of course to the payment of some allowance (either in cash or kind) for their survival. He also suggested that they serve the Indian Armed Services and that they be handed over the certificates of their medical degrees only after they complete the abovementioned five years.

Sapre, J., on the other hand, said that no case was made out for passing any directions under Article 142 of the Constitution as grant of any equitable relief may be construed as awarding premium to the appellants of what they did. It would demoralize the meritorious students who could not secure the admission on their merit due to the appellants’ entry in the Colleges by illegal means. He, however, said that the State may consider permitting the appellants and other candidates alike the appellants to appear in the competitive examination whenever it is held and consider granting age relaxation to those candidates who crossed the age limit, if prescribed. He was of the view that it is the collective responsibility of the Government (Central/States), educational bodies/Institutions to ponder over and evolve a uniform policy in a comprehensive manner to firmly deal with such activities in the larger public good. [Nidhi Kaim v. State of Madhya Pradesh, 2016 SCC OnLine SC 547, decided on 12.05.2016]