These petitions have been filed challenging a common judgement and order dated 24.2.2010 passed by learned Special Judge, CBI Court No.4, Ahmedabad. By the said order, learned Judge was pleased to dismiss several separate discharge applications filed by the accused. These accused have therefore, filed the present petitions calling in question the decision of the learned Judge on various grounds. In essence, they seek their discharge from the criminal case registered against them, for which trial is pending before the Special CBI Court, Ahmedabad and case is registered as Special Case No.31/2003.
Briefly stated, factual background is as follows :
2.1 An FIR bearing No. RC 16(A)2001 came to be registered on 19.4.2001 before the Gandhinagar police station alleging irregularities in purchase of the land for Indian Petrochemicals Corporation Ltd. ("IPCL" for short), which was at the relevant time a Government Company. In the FIR, it is alleged that during inquiry, it was found that certain lands were purchased from M/s. MP Traders in July 1999 at the total cost of Rs.2,18,75,274/- by the IPCL. These lands were purchased by M/s. MP Traders from farmers during January 1999 to April 1999 for a total cost of Rs.9,02,375/-. From the revenue records, it could be gathered that approximate cost of land was around Rs.60,000/- per acre whereas land was purchased by IPCL at Rs.6.25 lakh per acre. While entering into agreement with M/s. MP Traders, the cost of land was split into basic cost and cost towards locational advantage with a view to evade stamp duty. The laid down procedures were not followed. Serious objections raised by the Tender Evaluation Committee were overruled. From FIR, one further gathers that at the relevant time Shri K.Ramanathan(Accused No.1) was the CMD of IPCL, Shri N. Chander (Accused No.2) was the Director(Finance). One retired Government Officer Shri N.M.Bijlani (Accused No.3) who had rendered his services as a consultant was also involved in the entire purchase deal. FIR therefore, alleged that a criminal conspiracy was hatched between Shri K. Ramanathan, Shri N. Chander and Shri N.M. Bijlani and the partner of M/s. MP Traders namely, Jayantibhai Panchal for purchasing the lands at a higher price and thereby causing huge loss to IPCL and corresponding gain to private parties.
Pursuant to the said FIR, investigation was carried out by the CBI. Charge-sheet was filed on 14.7.2003. It would be necessary to take note of the prosecution case against the accused at some length as emerging from the charge-sheet which is as follows :
(3.1) In the year 1992, about 700 hectares of land was acquired by the IPCL for Gandhar project situated at Dahej, Taluka Vagra, District Bharuch from Gujarat Industrial Development Corporation ("GIDC" for short). On 28.6.1994, the Government of Gujarat approved acquisition of 30 hectares of land for providing housing for the employees of IPCL. Such land was to be acquired from Village Ambheta and acquisition was to be done by the GIDC. However, on account of disputes between GIDC and IPCL principally on the issue of development charges, this proposal did not materialise.
(3.2) Shri K.G. Ramanathan and Shri N.M. Bijlani, both being IAS officers of Gujarat Cadre were personal friends. After his retirement, Shri N.M.Bijlani had floated a consultancy firm in the name and style of M/s. NRD Associates Pvt. Ltd. of which he was the Chairman. Shri N.M. Bijlani had approached IPCL, and offered his services as consultant for land related matters. Shri Ramanathan had approved his appointment initially for a period of one year. Such appointment order of Shri Bijlani however, did not have any reference to purchase of land. He was to act only as consultant. Shri Bijlani accepted such terms and conditions. His contract though initially entered into on 31.5.1995 was for a period of one year, it was continued till 31.7.2000. As per the rules of IPCL, the Manging Director was required to inform the Board of Directors about such appointment of consultant which was not done.
(3.3) Shri N. Chander was the Director (Finance) of IPCL, and at the same time he was the senior-most officer in the Finance division and was responsible for proper utilisation of IPCL funds.
(3.4) While the matter pertaining to allotment of 15 hectares of land at village Ambheta was pending with GIDC, Shri Bijlani wrote a letter dated 24.8.1998 to Shri K.G. Ramanathan with a copy to Shri N. Chander and suggested that :
"We can purchase these NA lands either by giving advertisement in papers without disclosing name of IPCL or we can directly negotiate with M/s. MP Traders through whom we have purchased lands near Bharuch."
(3.5) The prosecution thus suggests that at the very outset M/s. MP Traders is indicated as prospective seller. On 15.1.1999. A meeting was held between Shri Bijlani, Shri Ramanathan and Shri Chander wherein a decision was taken to start work relating to acquisition of land for Emergency Township to be handled by M/s. NRD Associates Pvt. Ltd. No other officer of IPCL was involved in this decision. There was no assessment of the total land requirement or financial implications nor was there any approval of advertisement/notice inviting tender etc. Immediately after 15.1.1999, meeting between said three officials, Shri Bijlani held a meeting with M/s. MP Traders at Baroda.
(3.6) Pursuant to the decision taken on 15.1.1999, Shri Bijlani floated an advertisement(inviting tender) on 21st January and 22nd January, 1999 inviting tenders for requirement of 30 to 40 acres of land with conditions that land must be categorised as non agricultural land having clear title and free from all encumbrances. Land should also have permission of competent authority for non agricultural use. Only 10 days time was given to submit the offers. Six offers were received. In respect of bid offered by M/s. Arbuda Land Developers, Bharuch and M/s. MP Traders, Bharuch, Shri Bijlani had not put any date. No officer from IPCL was present at the time of opening the bids by Shri Bijlani nor any representative of any bidders were asked to remain present. It is thus the case of the prosecution that the whole sanctity of tender process was lost on account of opening of bid by Shri Bijlani on different dates and not even putting dates in two cases as to when tender bids were opened.
(3.7) On 5.2.1999, meeting was held at Baroda between Shri Ramanathan, Shri Chander and Shri Bijlani. Thus officers of IPCL were aware about flaws in handling tender bids.
(3.8) M/s.
MP Traders is a partnership firm engaged in land relating activities having Shri Jayantibhai Dalsukhbhai Panchal and his sons Shri Pranav Jayantibhai Panchal and Shri Kartik Jayantibhai Panchal as partners. Shri Jayantibhai Panchal owns other firms as well. M/s. MP Traders had acquired land from farmers, details of which are as follows :
Sr.
No.
Revenue Survey No. Tenure of land Area (in sq. mtrs.) Name of the original land holder Date of sale deed Amount shown in Sale Deed Amount received by landholders
1. 237 Old Tenure 20700 Smt.
Daxaben Laxmanbhai Shanubhai Smt.
Neetaben Laxmanbhai Shanubhai 5.1.99 Rs.51,250/-
Rs.6,71,375/-
2. 238 New Tenure 18300 Sh.Bhagwanbhai Devjibhai 12.1.99 Rs.45,250/-
Rs.5,28,649/-
3. 239(*) Old Tenure 40400 Sh.Narendrasinh Pahadsinh Sh.
Rajendrasinh Pahadsinh Sh.
Ranjitsinh Pahadsinh Sh.
Dilipsinh Pahadsinh 15.1.99 Rs.1,00,000/-
Rs.15,72,000/-
4. 240 Old Tenure 13200 Sh.
Chitubhai Dhirsinh Sh.Raisinh Dhirsinh Sh.Jitubhai Dhirsinh Sh.Daulatsinh Dhirsinh Sh.
Januba Chatrasinh Dhirsinh 8.1.99 Rs.32,500/-
Rs.4,30,750/-
5. 241 New Tenure 12000 Sh.
Lakhubhai Jibhai Sh.Jesangbhai Jibhai Sh.
Zaverbhai Jibhai Smt.
Bajiben Prabhat Jibhai 12.1.99 Rs.29,750/-
Rs.3,71,875/-
6. 242 Old Tenure 8800 Sh.
Balwantsinh Chatrasinh Sh.
Surendrasinh Ramsinh Sh.
Narendrasinh Ramsinh Smt.
Manharben Ramsinh 21.12.98 Rs.2,85,000/-
Rs.2,85,000/-
7. 251 New Tenure 31200 Sh.
Pravinsinh Deepsinh Sh.
Abhaysinh Deepsinh Smt.
Surajben Gajendrasinh Sh.Dharmendrasinh Gajendrasinh Smt.
Janakben D/o Sh Gajendrasinh Smt.
Hansaben D/o Sh. Gajendrasinh 4.2.99 Rs.77,000/-
Rs.13,53,000/-
8. 243 Old Tenure 24200 Sh.
Ahmed Umarji Ibrahim 24.2.99 Rs.59,750/-
Rs.11,95,000/-
9. 236 New Tenure 7200 Smt.
Leelaben Amarsinh Minor Neelesh Arvindsinh (Guardian Sh. Arjunsinh Ganpatsinh Raj) 26.4.99 Rs.2,21,875/-
Rs.1,71,874/-
TOTAL Rs.57,93,523/-
(3.9) M/s. MP Traders along with the bid had dispatched certain documents with respect to lands offered for sale containing certain forged documents. M/s. MP Traders had declared that they were submitting their offer for Revenue Survey Nos. 235, 236, 237, 238, 239, 240, 241, 242 and 251 of village Vadadla. They were having clear title of the lands and lands were in their names free from all encumbrances. Permission for using the land as non agricultural land was already granted. They had offered the land at a price of Rs.8 lakhs per acre and sale transactions could be completed by 15.3.1999.
(3.10) Contrary to such assertions of M/s. MP Traders, the land bearing Survey Nos. 236 and 251 were not registered in the names of partners of M/s. MP Traders. Land bearing Survey No. 236 was not free from encumbrances since legal proceedings were pending before the Court at Bharuch. None of the lands offered by M/s. MP Traders for sale had clear title in their names. Talati of the village was also not moved for mutation entries in the revenue records. Permission of the competent authority for non agricultural use of the land was not granted.
(3.11) Shri Naginbhai R. Rohit(since deceased) who was at the relevant time Talati-cum-Mantri of village Vadadla had besides others, issued entries of Village Register No.6 as follows :
"(1) Entry bearing serial no.1554 dated 28.1.99 regarding purchase of land at Revenue Survey No.242 from Sh. Balwantsinh Chatrasinh.
(2) Entry bearing serial no.1553 dated 28.1.99 regarding purchase of land at Revenue Survey Nos.235, 238 and 241 from Smt. Savitaben Bhupatbhai, Sh. Bhagwanbhai Devjibhai and Sh. Lakhubhai Jibhai."
(3.12) Such certified copies were produced by Shri Pranav Panchal before IPCL with his letter dated 26.1.99. It was however, revealed that such entries did not reflect the correct position of the record. On 28.1.99, mutation process was not even initiated by Talati-cum-Mantri. Entry in Survey No.242 was made only on 7.3.99. This entry being Survey No.1553 was dated 7.3.99 and was confirmed by Circle Officer, Vagra only on 12.5.99. Prosecution therefore, alleges that Shri Rohit Talati-cum-Mantri has dishonestly prepared false documents pertaining to the above survey number and issued same in favour of Shri Pranav Panchal on 28.1.99 certifying that same were reproduced from the original. Thus false and fabricated documents were issued showing survey no.242 in name of Shri Jayantibhai Panchal and Survey Nos. 241, 238 and 235 also in name of Jayantibhai Panchal.
(3.13) In November, 1998 during the negotiation with land owners, Shri Jayantibhai Panchal had lured them to sale land in hope of same being purchased by IPCL, clearly showing that well in advance M/s. MP Traders had the knowledge of requirement of land by IPCL.
(3.14) On 5.2.99, a meeting took place between Shri Bijlani, Shri Ramanathan and Shri Chander. Pursuant to the decision taken in the meeting, all parties who had responded to advertisement were called for personal discussions. Five bidders were called on different dates. M/s. Avani Enterprises which had quoted Rs.8.5 lakhs per acre was given a chance to submit the revised offer by 10.3.99. However, without waiting for response, Shri Bijlani submitted preliminary report to IPCL on 5.3.99 and recommended that land be acquired from M/s. MP Traders. In the report it was dishonestly stated that there are no statistics for sale of NA lands in near vicinity or adjoining villages whereas several instances of sale could be cited.
(3.15) Thus Shri Bijlani recommended purchase of land from M/s. MP Traders when lands were not in their names, NA use permission was not obtained. Original documents pertaining to M/s. MP Traders were retained by Shri Bijlani and were recovered only during investigation on 7.8.01. Such documents were found tampered.
(3.16) During the period between March 1998 to September 1999, Shri Bijlani received a total payment of Rs.15,96,750/- through eight different cheques drawn in favour of either of his firms or his personal names. The payment was routed by Shri Jayantibhai Panchal through cheques obtained from M/s. Poonamchand Devchand Shroff, a partnership firm which does the business of cheque discounting. M/s. Poonamchand Devchand Shroff consisted of partners Shri Bharatbhai D. Shah and others. Shri Bharatbhai D. Shah was friend of Shri Jayantibhai Panchal. Upon receipt of cheques from Shri Jayantibhai Panchal, M/s. Poonamchand Devchand Shroff issued eight cheques which were in favour of Shri Bijlani and his firms which were duly encashed. Thus lands which were not in name of M/s. M.P. Traders were offered for sale. Though advertisement called for only non agricultural land, land without such non agricultural use permission was offered and accepted. Village documents were fabricated with the assistance of Talati-cum-Mantri Shri Naginbhai Rohit and Shri Baldevbhai Kunwarji Bhagat, Circle Inspector.
(3.17) It is further the case of the prosecution that signatures and thumb impressions were obtained by Shri Jayantibhai Panchal on blank papers from the original land owners. With help of such documents, common application for Non Agriculture Use permission was filed for all survey numbers for their residential purpose. One of the signatures of land owners Shri Abhaysinh Deepsinh of Survey No.251 was forged for the said purpose.
(3.18) Such application was processed by Circle Inspector Shri Bhagat without verifying genuineness of the applications or the purpose for which it was acquired. Without recording the statements of the original landholders, he generated a false report on blank papers made available to him by Shri Jayantibhai Panchal. He prepared a statement in his own handwriting and in his signature purported to be of land owner, that they were owners of land and they had applied for Non Agricultural Use and were willing to abide by NA conditions which may be imposed. Such report was signed by Talati-cum-Mantri Shri Naginbhai Rohit (3.19) The land holders did not have any other land in Vadadla. They were not resident of that village but of neighbouring villages. They did not require the land for residential accommodation for themselves at Vadadla.
(3.20) Shri Bhagat in collusion with Shri Rohit generated false documents showing that he had recorded statements of villagers of Vadadla. Factum of land being purchased by Shri Jayantibhai Panchal was concealed. Shri Bhagat and Shri Rohitbhai both had knowledge about sale of land to Shri Jayantibhai Panchal, since entries were sought to be made in Village Register on the basis of such reports. Final orders were passed on 16.3.99 in favour of original landholders and not in favour of Shri Jayantibhai Panchal or other partners of M/s. MP Traders. Had the sale in favour of M/s. MP Traders or its partner was not concealed by Talati-cum-Mantri and Circle Inspector, NA permission would not have been granted and the purchasers would have had to apply afresh. It was only after the NA permission was granted that mutation entries were made in Village Register form on 12.5.99 and 21.7.99.
(3.21) To give semblance of authenticity, Shri N.R. Desai a Government approved valuer was appointed to submit his valuation report to aid and abate other accused in furtherance of conspiracy. Said Shri Desai also prepared unrealistic and inflated valuation report. Charge-sheet further details by-passing official channel and circumventing other officers of IPCL to strike the deal, Shri Panchal was called for negotiation. After some initial reluctance, he offered rate of Rs.6.25 lakhs per acre which was agreed mutually too. He offered total 43 acres and 28 gunthas which was decided to be purchased. No record of discussion between Shri Chander and other officers of IPCL is available to show how there was increase in requirement from 20 acres to 43 acres.
(3.22) Shri Ramanathan despite being well aware that the amount is beyond his financial competence, sanctioned the purchase which was in excess of Rs. 2 crores. He could not have done so without prior sanction of Board of Directors. Despite objection from the Committee members, he granted ex post facto approval to purchase of 35 acres of land. Shri Ramanathan had kept other senior officers such as Director(Personnel) and Director (Executive) completely out of picture.
(3.23) Gandhar complex of IPCL has its own bank account in State Bank of India at Dahej and Bharuch branch and in HDFC bank, Dahej Branch, despite which Demand Draft was drawn in favour of M/s. MP Traders of Rs.1.90 crores payable to M/s. MP Traders at Bharuch. In normal circumstances, payments are made through cheque and not Demand Draft and in case payment is made through demand draft, bank commission is to be recovered from recipient which was not done in the present case. Payments were made in excess of the authority as Director(Finance) without sanction of Board of Directors. Thus Shri Ramanathan granted post facto approval for purchase without putting the matter before the Board for its approval and Director(Finance) released the payments in excess of his financial competence without sanction from the Board.
(3.24) Land purchased was in excess of actual need of IPCL. Payments were released in favour of M/s. MP Traders without deal being finalised. To cover up, accused started generating anti-dated documents. Agreement of Rs.20/- stamp paper was shown to have been executed on 28.7.99 purported to be an unregistered agreement to sale. In this agreement price of land was split into three parts, (1) Rs.4 lakhs per acre towards the cost of land,(2) Rs. 1 lakh per acre towards crop-compensation and (3) Rs.1.25 lakhs per acre to cover expenses such as site levelling, area grading etc. Advertisement never envisaged any payment towards crop compensation or site development. Total sum of Rs.35 lakhs was paid towards compensation.
(3.25) It is further alleged that though the price of land negotiated by M/s. MP Traders was Rs.6.25 lakhs per acre, sale deed was executed only indicating sale price of Rs.4 lakh per acre.
(3.26) The amount paid towards crop compensation never reached the farmers. In fact it is the case of the prosecution that there was no crop standing at the time when the land was sold. M/s. MP Traders had obtained land from illiterate and ignorant land owners and created false evidence of having paid amounts to them. In fact such payments were rerouted to Panchals through same M/s. Poonamchand Devchand Shroff. All land owners were shown to have deposited their cheques with said M/s. Poonamchand Devchand Shroff. It is alleged that had payments being genuinely made, land owners would have deposited the cheques in their respective bank accounts.
(3.27) Charge-sheet further gives details of large number of other instances of sale of non agricultural lands in the area to demonstrate that price paid was highly inflated and unrealistic. It is not necessary to record such minute details given in charge-sheet. Suffice it to note that as per the prosecution there were documents of comparable sale instances and revenue record as well as Jantri rates to show that price of land of Rs.6.25 lakh per acre was highly inflated.
(3.28) There are further details given in charge-sheet with respect to procedural breaches and circumvention of requirements and of rules of IPCL before acquiring the land. Again it is not necessary to go into such details for the purpose of this order. Suffice it to record that case of prosecution as already highlighted is that in flagrant violation of rules, regulations and other requirements of IPCL, land in excess of its needs were acquired from M/s. MP Traders at exorbitant rate of Rs.6.25 lakhs per acre, which was much higher the then prevailing market price. Case of the prosecution is that a systematic conspiracy was hatched to benefit individuals at the cost of IPCL. Huge amount of payments were made without proper authority or sanction of the Board. It is the case of the prosecution that lands purchased by M/s. MP Traders from individual farmers during period from January 1999 to April 1999 for total cost of Rs.9,02,375/- were sold to IPCL in July 1999 at Rs.2,18,75,000/-. It is also the allegation of the prosecution that M/s MP Traders were aware about proposal to purchase even before the process was initiated. Shri Bijlani even before inviting tenders had recommended the name of M/s MP Traders for the purchase of lands. When the lands were offered by M/s MP Traders in response to advertisement issued by IPCL, lands were not even mutated in their names. Though one of the essential conditions of tender was that land should have Non Agriculture Use permission, agricultural lands were offered for sale showing them to be non agricultural land. NA permissions were obtained much later. NA permissions were applied in the name of original land owners after same was sold to M/s. MP Traders. NA permissions were obtained on basis of fabricated documents, falsely created reports and inaccurate facts. Even before IPCL, forged documents of revenue records were produced. On these basis, prosecution seeks to proceed against all the accused.
Accused No.1 is Shri K. Ramanathan, the then Managing Director of IPCL. Accused No.2 is Shri N. Chander who was Director (Finance) of IPCL. Accused No.3 Shri N.M.Bijlani a retired IAS officer had acted as consultant to IPCL. Accused no.4 and 5 were partners of M/s. MP Traders. Accused no.6 is partnership firm itself. Accused no.7 Shri N.R. Desai was valuer who worked along with accused no.3 and gave valuation report which according to the prosecution was inflated. Accused no.8 Talati-cum-Mantri is since deceased and thus is deleted. Accused no.9 was Circle Inspector who allegedly created false documents to enable M/s MP Traders to obtain NA permission for land in question in the name of original land owners. Accused No. 10 and 11 were partners of M/s. Poonamchand Devchand Shroff who had through their cheque discount business enabled the parties to route their illegal transactions and money on various occasions. Such firm was utilised by M/s. MP Traders for routing payment of kickback of Rs.15 lakhs to Shri Bijlani. Such firm was also utilised by M/s. MP Traders for showing only on paper payments of crop compensation to the original land owners without the money ever reaching the farmers.
It is in this background that prosecution was going on against the accused before the trial Court. Accused filed different discharge applications. Such applications were dismissed by common impugned judgement dated 24.2.2010. These petitions have therefore, been filed by different accused challenging the said judgement on various grounds.
Appearing for accused no.1 Shri Ramanathan, learned senior counsel Shri K.S. Nanavati submitted that accused no.1 at the relevant time was public servant as defined in Section 21 of the Indian Penal Code, since as provided in clause twelfth of Section 21, he was in service of Government company as defined under Section 617 of the Companies Act, 1956. He therefore, submitted that before prosecution, sanction ought to have been obtained from competent authority. Since in the present case admittedly no sanction was obtained, Court could not have taken cognizance and framed charges.
(6.1) Counsel pointed out that accused no.1 has retired with effect from 1.3.2000. However, same would have no effect on requirement of sanction particularly, in view of provisions contained in Section 197 of the Code of Criminal Procedure. My attention was drawn to orders of his appointment in IPCL after his resignation from Government service. He pointed out that after resignation from Government service on 6.11.1992, he was appointed in IPCL on 8.11.1992 and continued to work there till his retirement with effect from 1.3.2000. Offences were allegedly committed in the period between 1996 to 1998. Counsel contended that allegedly offences were committed while acting or purporting to act in discharge of official duty, no cognizance of such offences could be taken except with sanction of the competent authority. This was the main and in fact the sole ground pressed in service by Shri K.S. Nanavati.
(6.2) In support of his contention, counsel relied on following decisions :
1) Shreekantiah Ramayya Munipalli and another v. State of Bombay reported in AIR 1955 SC 287, wherein it was held as under :
"18.
Now it is obvious that if S.197 Cr.P.C. is construed too narrowly it can neve be applied, for of-course it is no part offence official's duty to commit an offence and never can be. But it is not the duty we have to examine so much as the act, because an official act can be confirmed in the discharge of official duty as well as in dereliction of it. The section has content and its language must be even meaning."
2) Matajog Dobey v. H.C, Bhari reported in AIR 1956 SC 44, wherein it was observed as under :
"17.Slightly differing tests have been laid down in the decided oases to ascertain the scope and the meaning of the relevant words occurring in section 197 of the Code; "any offence alleged to have been committed by him while acting or purporting to act in the discharge of his official duty". But the difference is only in language and not in substance. The offence alleged to have been committed must have something to do, or must be related in some manner, with the discharge of official duty. No question of sanction can arise under section 197, unless the act complained of is an offence; the only point to determine is whether it was committed in the discharge of official duty. There must be a reasonable connection' between the act and the official duty. It does not matter even if the act exceeds what is strictly necessary for the discharge of the duty, as this question will arise only at a later stage when the trial proceeds on the merits. What we must find out is whether the act and the official duty are so inter-related that one can postulate reasonably that it was done by the accused in the performance of the official duty, though possibly in excess of the needs and requirements of the situation....
xxx
19. The result of the foregoing discussion is this: There must be a reasonable connection between the act and the discharge of official duty; the act must bear such relation to the duty that the accused could lay a reasonable, but not a pretended or fanciful claim, that he did it in the course of the performance of his duty"
3) Bhagwan Prasad Srivastava v. N.P. Mishra reported in AIR 1970 Supreme Court 1661, wherein after discussing the principle emerging from Section 197 of the Code of Criminal Procedure, Apex Court dealt with the question whether a particular act done by a public servant in the discharge of his official duty is substantially one of fact to be determined on the circumstances of each case.
4) Pukhraj v. State of Rajasthan and another reported in AIR 1973 Supreme Court 2591, wherein it was observed that the intention behind Section 197 of the Code of Criminal Procedure is to prevent public servant from being unnecessarily harassed. It was observed that :
"...The test appears to be not that the offence is capable of being committed only, by a public servant and not anyone else, but that it is committed by a public servant in an act done or purporting to be done in the execution of his duty. The section cannot be confined to only such acts as are done by a public servant directly in pursuance of his public office, though in excess of the duty or under a mistaken belief as to the existence of such duty,. Nor need the act constituting the ,offence be so inseparably connected with the official duty as to form part and parcel of the same transaction. What is necessary is that the offence must be in respect of an act done or purported to be done in the discharge of an official duty. It does not apply to acts done purely in a private capacity by a public servant..."
5) S.B.Saha and others v. M.S. Kochar reported in AIR 1979 Supreme Court 1841, wherein it was observed as under :
"19.
In sum, the sine qua non for the applicability of this Section is that the offence charged, be it one of commission or omission, must be one which has been committed by the public servant either in his official capacity or under colour of the office held by him. While the question whether an offence was committed in the course of official duty or under colour of office, cannot be answered hypothetically, and depends on the facts of each case, one broad test for this purpose, first deduced by Varadachariar J. of the Federal Court in Hori Ram v. Emperor, (1) is generally applied with advantage. After referring with approval to those observations of Varadachariar J., Lord Simonds in H.H.B. Gill v. The King.(2) tersely reiterated that the "test may well be whether the public servant, if challenged, can reasonably claim, that what he does, he does in virtue of his office."
6) State of Madhya Pradesh v. Sheetla Sahai and others reported in (2009) 8 Supreme Court Cases 617, wherein it was observed as under :
"56.
This leaves us with the question as to whether an order of sanction was required to be obtained. There exists a distinction between a sanction for prosecution under Section 19 of the Act and Section 197 of the Code of Criminal Procedure. Whereas in terms of Section 19, it would not be necessary to obtain sanction in respect of those who had ceased to be a public servant, Section 197 of the Code of Criminal Procedure requires sanction both for those who were or are public servants."
Learned senior counsel Shri Bhaskar Tanna appearing for accused no.3 contended that Shri Bijlani had acted only as a consultant for IPCL. He had no further role to play. He had in fact negotiated the best price. If the land was purchased from GIDC, IPCL would have had to pay much higher amount. Even M/s. MP Traders had substantially reduced their rates as compared to those initially quoted. Land was required urgently for housing purpose for the employees of IPCL. In short, he submitted that the said accused had not committed any offence. There is no evidence to proceed against him. Trial Court therefore, erred in rejecting his discharge application.
Learned senior counsel Shri S.V. Raju appearing for accused nos. 4, 5 and 6 namely partners of M/s. MP Traders and the firm submitted that none of the offences indicated in the charge-sheet have been disclosed. He submitted that ingredients of none of these offences are either contained in FIR or disclosed in the charge-sheet.
(8.1) Counsel submitted that M/s. MP Traders had supplied the land which was free from all encumbrances and had clear title. Such land was supplied at cheapest rates. There was no other person ready to provide the land at the rate lesser than what was offered by M/s. MP Traders.
(8.2) Counsel further submitted that the land was purchased through public advertisement. When such mode is adopted by the authorities, it cannot be alleged that the land at a rate higher than market rate was purchased by IPCL. In this connection he relied on decision of the Apex Court in case of R. Sai Bharathi v. J. Jayalalitha and others reported in AIR 2004 Supreme Court 692.
(8.3) Counsel submitted that the allegations of forgery are not made out. Even if thumb impressions were obtained on blank papers or thumb impressions of some other persons were obtained on documents, that by itself would not constitute offence of forgery. In this regard counsel relied on decision of the Apex Court in case of Mohammed Ibrahim and others v. State of Bihar and another reported in (2009) 8 Supreme Court Cases 751.
(8.4) Counsel relied on decision of Apex Court in case of Dr. Vimla v. Delhi Administration reported in AIR 1963 SC 1572, wherein allegations were that one Dr. Vimla in connection with transaction of motor car had received money by signing the claim forms in name of her minor daughter. It was in this background the Apex Court was of the opinion that such action would not constitute offence of forgery since it cannot be stated that any false document was created fraudulently.
(8.5) Reliance was placed on decision in case of Jibrial Diwan v. State of Maharashtra reported in (1997) 6 Supreme Court Cases 499, which was a case wherein certain persons were prosecuted on the allegation that at a cultural show they had forged letterhead of minister. Such accused were however, acquitted. Allegations against the appellant before Supreme Court was that he had delivered such letters to the recipient. Apex Court was of the opinion that he cannot be prosecuted for offences under Sections 471 read with Section 465 since basic ingredient that he acted dishonestly and fraudulently were missing.
(8.6) Counsel relied on decision in case of Parminder Kaur v. State of Uttar Pradesh and another reported in (2010) 1 Supreme Court Cases 322, wherein the accused was being prosecuted for tampering with certified copy of revenue records in which he had allegedly changed date from 6.5.2002 and 7.5.2002 to 16.5.2002 and 17.5.2002 and such tampered copies were used in civil suit. Apex Court was of the opinion that facts did not disclose commission of offences under Sections 467, 468 and 471 of IPC and that therefore, complaint should be quashed.
(8.7) Counsel submitted that even the offence of cheating is not made out from the records. In this regard, he relied on decision of the Apex Court in case of All Cargo Movers (India) Private Limited and others v. Dhanesh Badarmal Jain and another reported in (2007) 14 Supreme Court Cases 776. It was a case wherein the Apex Court was of the opinion that there were civil disputes between the parties, civil suit was also filed. Complaint under Sections 406 and 420 of the IPC was therefore, quashed.
(8.8) With regard to allegations of receiving money under the head of crop compensation, Counsel submitted that only for convenience the sale price was split under different heads. No offence could be stated to have been committed. With respect to allegation of commission paid to Shri Bijlani by M/s. MP Traders, Counsel submitted that such payments were reversed. In any case, any such payment would not amount to offence since accused no.3 was not a public servant.
(8.9) With respect to offence under Section 13(1)(d) of the Prevention of Corruption Act, counsel submitted that same can be charged only against public servant. In any case, no ingredients are disclosed.
(8.10) Counsel vehemently contended that there is no evidence in support of conspiracy theory. Section 120-B of the IPC therefore, cannot be applied.
(8.11) Referring to decision in case of Depot Manager, A.P. State Road Transport Corporation v. Mohd. Yousuf Miya and others reported in (1997) 2 Supreme Court Cases 699 and in case of Yogesh alias Sachin Jagdish Joshi v. State of Maharashtra reported in (2008) 10 Supreme Court Cases 394, counsel submitted that this is a fit case where powers of discharging the accused should be exercised.
Counsel Shri Mihir Thakore appearing for accused no.7 land valuer submitted that he was not a Government servant. He had only supplied his valuation of land in question. No offence is stated to have been committed. He had taken into account all relevant aspects before drawing the report. He submitted that prosecution is trying to compare the sale instances of older period which are not comparable. Counsel relied on following decisions :
1) Esher Singh v. State of A.P. reported in (2004) 11 Supreme Court Cases 585, wherein it was observed as under :
"No doubt in the case of conspiracy there cannot be any direct evidence. The ingredients of offence are that there should be an agreement between persons who are alleged to conspire and the said agreement should be for doing an illegal act or for doing illegal means an act which itself may not be illegal. Therefore, the essence of criminal conspiracy is an agreement to do an illegal act and such an agreement can be proved either by direct evidence or by circumstantial evidence or by both, and it is a matter of common experience that direct evidence to prove conspiracy is rarely available. Therefore, the circumstances proved before, during and after the occurrence have to be considered to decide about the complicity of the accused."
2) Saju v. State of Kerala reported in (2001) 1 Supreme Court cases , wherein it was observed as under :
"(10) It has thus to be established that the accused charged with criminal conspiracy had agreed to pursue a course of conduct which he knew leading to the commission of a crime by one or more persons to the agreement, of that offence. Besides the fact of agreement the necessary mens rea of the crime is also required to be established."
3) P.
Vijayan v. State of Kerala and another reported in (2010) 2 Supreme Court Cases 398, wherein in context of power of discharge under Section 227 of Code of Criminal Procedure, the Apex Court observed as under :
"(10) If two views are possible and one of them gives rise to suspicion only, as distinguished from grave suspicion, the Trial Judge will be empowered to discharge the accused and at this stage he is not to see whether the trial will end in conviction or acquittal. Further, the words "not sufficient ground for proceeding against the accused" clearly show that the Judge is not a mere Post Office to frame the charge at the behest of the prosecution, but has to exercise his judicial mind to the facts of the case in order to determine whether a case for trial has been made out by the prosecution. In assessing this fact, it is not necessary for the Court to enter into the pros and cons of the matter or into a weighing and balancing of evidence and probabilities which is really the function of the Court, after the trial starts."
Learned counsel Shri Goswami appeared for accused no. 10 and 11 and submitted that said accused worked only as shroff and were involved in business of cheque discounting. In course of their business, they had certain business transactions with M/s. MP Traders and their partners. They cannot be stated to have committed any offence. He submitted that there is no evidence to connect the said accused even on the basis of theory of conspiracy.
Learned counsel Shri Limbachia appearing for accused no.2 submitted that accused no.2 being a public servant, in absence of any sanction from the prosecution, the proceedings must be quashed.
Learned counsel Shri B.C. Dave who appeared for accused no.9 submitted that said accused was employed as Circle Inspector and was employee of Taluka Panchayat. He had only given opinion about the non agricultural use permission sought by the land owners. He had not passed any order thereon. In short he submitted that role of the said accused was limited to give his legal opinion on the application for non agricultural use.
Learned counsel Shri Y.N. Ravani appeared for CBI and opposed the petitions. He vehemently contended that Revision Applications are not maintainable. In support of this contention, he relied on an unreported decision of Delhi High Court in case of Dharambir Khattar v. Central Bureau of Investigation dated 5.5.2009, wherein Learned Single Judge of Delhi High Court was of the opinion that in view of Section 19 of Prevention of Corruption Act, no revision application would be maintainable before High Court against interlocutory orders passed by the Special Court.
(13.1) Counsel submitted that there was a systematic attempt on part of the accused to siphon away funds of IPCL by inflating the land price at which IPCL would make purchase of land for housing purpose. Counsel submitted that accused no.1 was was the Managing Director of IPCL, accused no.2 was Director(Finance) and accused no.3 was a retired IAS officer who was appointed as consultant. He submitted that there is voluminous evidence on record to suggest that M/s MP Traders were favoured. Land was purchased at exorbitant price. In fact there is evidence to suggest that accused no.3 Bijlani was even today paid commission by M/s. MP Traders. Therefore, at this stage Court should not interfere.
(13.2) Counsel further submitted that sanction of prosecution would not be necessary since it cannot be stated that any of the accused committed said action in discharge or in purported discharge of their official duties. He submitted that insofar as offences under the Prevention of Corruption Act are concerned, in any case all the persons who were public servants have since retired and there is therefore, no further requirement to obtain sanction for prosecution. Counsel relied on the following decisions:
1) State of H.P. v. M.P. Gupta reported in (2004) 2 Supreme Court Cases 349, wherein the Apex Court observed as under :
"21.
That apart, the contention of the respondent that for offences under Sections 406 and 409 read with Section 120-B of IPC sanction under Section 197 of the Code is a condition precedent for launching the prosecution is equally fallacious. This Court has stated the legal position in Shreekantiah Ramayya Munnipalli's case (supra) and also Amrik Singh's case (supra) that it is not every offence committed by a public servant which requires sanction for prosecution under Section 197 of the Code, nor even every act done by him while he is actually engaged in the performance of his official duties. Following the above legal position it was held in Harihar Prasad, etc. v. State of Bihar (1972 (3) SCC 89) as follows :
"As far as the offence of criminal conspiracy punishable under Section 120-B, read with Section 409, Indian Penal Code is concerned and also Section 5(2) of the Prevention of Corruption Act is concerned, they cannot be said to be of the nature mentioned in Section 197 of the Code of Criminal Procedure. To put it shortly, it is no part of the duty of a public servant, while discharging his official duties, to enter into a criminal conspiracy or to indulge in criminal misconduct. Want of sanction under Section 197 of the Code of Criminal Procedure is, therefore, no bar."
Above views are reiterated in State of Kerala v. Padmanabhan Nair (1999 (5) SCC 690). Both Amrik Singh (supra) and Shreekantiah (supra) were noted in that case. Sections 467, 468 and 471 IPC relate to forgery of valuable security, Will etc; forgery for purpose of cheating and using as genuine a forged document respectively. It is no part of the duty of a public servant while discharging his official duties to commit forgery of the type covered by the aforesaid offences. Want of sanction under Section 197 of the Code is, therefore, no bar."
2) Similar observations were also made in N. Bhargavan Pillai (dead) by lrs. and another v. State of Kerala reported in (2004) 13 Supreme Court Cases 217 and in case of State of Uttar Pradesh v. Paras Nath Singh reported in (2009) 6 Supreme Court Cases
372.
3) S.S.
Dhanoa v. Municipal Corporation, Delhi and others reported in (1981) 3 Supreme Court Cases 431, wherein it was held that IAS officer on deputation to a Government owned registered Cooperative society would not be a public servant within the meaning of clause Twelfth(b) of Section 21 of the IPC. However, in my view said situation does not arise in the present proceedings. Said decision therefore would have no applicability.
4) Similar is decision in case of N.K. Sharma v. Abhimanyu reported in (2005) 13 Supreme Court Cases 213, wherein a Government employee who was on deputation was placed as the Managing Director of the Cooperative Society. It was in this background that Apex Court held that sanction for prosecution under Section 197 of the Code of Criminal Procedure would not be necessary.
5) Reference was made to decision in case of State of Orissa v. Debendra Nath Padhi reported in (2005) 1 Supreme Court cases 568, in case of Sanghi Brothers(Indore) Pvt. Ltd. v. Sanjay Choudhary and ors, reported in AIR 2009 Supreme Court 9, in case of Rumi Dhar(SMT) State of West Bengal and another reported in (2009) 6 Supreme Court Cases 364 and in case of Bholu Ram v. State of Punjab and another reported in (2008) 9 Supreme Court Cases 140 to point out the nature and scope of discharge application
6) Decision in case of Ram Narayan Popli v. Central Bureau of Investigation reported in (2003) 3 Supreme Court Cases 641 was cited to contend that for the purpose of criminal conspiracy under Section 120-B of the IPC, no overt act is required to be done in furtherance of the conspiracy and further that conspiracy can be proved either by direct evidence or by circumstantial evidence or both.
Having thus heard learned counsel for the parties and having perused the documents on record, following questions arise for our consideration :
1) Are the present proceedings maintainable in law?
2) Were the accused no.1 and 2 public servants at the relevant time when the alleged offences took place?
3) If yes, accused no. 1 and 2 being public servants, whether sanction for prosecution was necessary :
(a) with respect to offences punishable under the IPC ?
(b) with respect to offences punishable under the Prevention of Corruption Act ?
4) With respect to all or any of the accused, is case of discharge made out from the facts on record?
5) Can it be stated that none of the offences stated in the charge-sheet have been disclosed as contended by learned counsel Shri S.V. Raju?
6) What final order?
[(Q.1)Are the present proceedings maintainable in law?] First question arises out of the contention of Counsel Shri Ravani that revision application against an interlocutory order passed by the Special Court would not be maintainable in view of Section 19 of the Prevention of Corruption Act. As noted in support of said contention reliance is placed on decision of Delhi High Court in case of Dharambir Khattar(supra).
To my mind however, such question need not detain me for long. Primarily, the proceedings are brought before this Court though against order on discharge applications passed by the trial Court, in essence, for the purpose of quashing entire proceedings on various grounds. It is true that some of the grounds pertain to want of material on record for proceeding against the accused further. However, substantial grounds have been raised before me in form of questioning the very prosecution without proper sanction and also on the ground that even if allegations in FIR and allegations of prosecution in charge-sheet are taken on face value, no offence can be stated to have been committed. In that view of the matter, even if the maintainability of revision petition was questionable, accused could have approached this Court in quashing proceedings invoking power of this Court under Section 482 of the Code of Criminal Procedure read with Article 226 of the Constitution. In that view of the matter, keeping question of maintainability open, I have examined the issues on merits.
[(Q.2) Were the accused no.1 and 2 public servants at the relevant time when the alleged offences took place?] Second question is whether at the relevant time when the alleged offences took place, accused no.1 and 2 were public servants as defined under Section 21 of the IPC. Clause twelfth is relevant for our purpose which reads as under :
"Twelfth-
Every person-
(a) in the service or pay of the Government or remunerated by fees or commission for the performance of any public duty by the Government.
(b) in the service or pay of a local authority, a corporation established by or under a Central, Provincial or State Act or a Government company as defined in section 617 of the Companies Act, 1956 (1 of 1956)."
16.1 It is an undisputed position that both the accused were employed in IPCL which was a Government company. That being the position, they would be covered under clause-twelfth of Section 21 of IPC. In fact it is not even the case of CBI that these accused were not public servants. Otherwise question of application of offences punishable under the Prevention of Corruption Act would not arise. So much is plain and clear.
[(Q.3) If yes, accused no. 1 and 2 being public servants, whether sanction for prosecution was necessary :
(a) with respect to offences punishable under the IPC ?
(b) with respect to offences punishable under the Prevention of Corruption Act ?
This question needs to be answered in part, the manner in which it is framed.
(17.1) With respect to offence punishable under the Prevention of Corruption Act, there cannot be any dispute that since the accused have since retired and therefore, ceased to be public servant, there was no need to obtain sanction for their prosecution. This aspect is emerging from series of decisions of Apex Court including in case of State of H.P. v. M.P. Gupta(supra) wherein Apex Court held as under :
"16.
When the newly-worded section appeared in the Code (Section 197) with the words "when any person who is or was a public servant" (as against the truncated expression in the corresponding provision of the old Code of Criminal Procedure, 1898) a contention was raised before this Court in Kalicharan Mahapatra v. State of Orissa that the legal position must be treated as changed even in regard to offences under the Old Act and New Act also. The said contention was, however, repelled by this Court wherein a two-Judge Bench has held thus:
"A public servant who committed an offence mentioned in the Act, while he was a public servant, can be prosecuted with the sanction contemplated in Section 19 of the Act if he continues to be a public servant when the court takes cognizance of the offence. But if he ceases to be a public servant by that time, the court can take cognizance of the offence without any such sanction."
17. The correct legal position, therefore, is that an accused facing prosecution for offences under the Old Act or New Act cannot claim any immunity on the ground of want of sanction, if he ceased to be a public servant on the date when the court took cognizance of the said offences. But the position is different in cases where Section 197 of the Code has application.
18. Section 197(1) provides that when any person who is or was a public servant not removable from his office save by or with the sanction of the Government is accused of any offence alleged to have been committed by him while acting on purporting to act in the discharge of his official duty, no Court shall take cognizance of such offence except with the previous sanction (a) in the case of a person who is employed or, as the case may be, was at the time of commission of the alleged offence employed, in connection with the affairs of the Union, of the Central Government and (b) in the case of a person who is employed or, as the case may be, was at the time of commission of the alleged offence employed, in connection with the affairs of a State, of the State Government.
19. We may mention that the Law Commission in its 41st Report in paragraph 15.123 while dealing with Section 197, as it then stood, observed "It appears to us that protection under the section is needed as much after retirement of the public servant as before retirement. The protection afforded by the section would be rendered illusory if it were open to a private person harbouring a grievance to wait until the public servant ceased to hold his official position, and then to lodge a complaint. The ultimate justification for the protection conferred by Section 197 is the public interest in seeing that official acts do not lead to needless or vexatious prosecution. It should be left to the Government to determine from that point of view the question of the expediency of prosecuting any public servant".
It was in pursuance of this observation that the expression 'was' come to be employed after the expression 'is' to make the sanction applicable even in cases where a retired public servant is sought to be prosecuted.
20. Above position was highlighted in R. Balakrishna Pillai v. State of Kerala"
(17.2) Same view was reiterated in case of Prakash Singh Badal and another v. State of Punjab and others reported in (2007) 1 Supreme Court Cases 1.
With respect to requirement of sanction for prosecution under Section 197 of the Code of Criminal Procedure, issue is to be looked from two angles. First would be, whether by virtue of retirement of the accused and therefore, ceasing to be public servants, was there any further requirement to obtain sanction for prosecution and secondly, whether the acts and omission alleged against them were in discharge of their official duty or in purported discharge of their official duty so as to attract the provisions of Section 197 of the Code of Criminal Procedure.
(18.1) Insofar as question of continuous requirement for sanction of prosecution for a public servant under Section 197 of the Code of Criminal Procedure, even after his retirement, there is total judicial unanimity. By series of decisions, the Apex Court held that words "Any person who is or was a public servant" will include the person who is retired from his position and therefore, ceases to be a public servant. In other words, even after retirement, requirement of obtaining of sanction for prosecution under Section 197 of the Code of Criminal Procedure would not cease to operate, if it was otherwise necessary.
(18.2) In case of M.P. Gupta (supra), the Apex Court took note of Law Commission's 41st report pursuant to which the expression "was" added after expression "is" in Section 197 of the Code of Criminal Procedure and observed that "it was in pursuance of this observation that the expression "was" came to be employed after the expression "is" to make the sanction applicable even in cases where a retired public servant is sought to be prosecuted.
(18.3) This view is universally accepted and one need not cite series of decisions in this regard. Question is, on facts, was sanction for prosecution required under Section 197 of the Code of Criminal Procedure ?
(18.4) As noted, learned counsel appearing for both the sides have made detailed submissions with regard to this issue. On behalf of accused it was primarily contended that the acts and omissions allegedly committed by accused no.1 and 2 could only be in discharge or for purported discharge of their duties and that therefore, sanction for prosecution was necessary. Several decisions were cited to contend that any action which even constitutes offence which is in discharge of or in purported discharge of his public duty, would attract requirement of sanction for prosecution. On the other hand citing decisions of Apex Court, counsel for CBI vehemently contended that there cannot be any duty to commit an offence and sanction for prosecution was therefore, not necessary.
(18.5) Insofar as offence of forgery are concerned, we have three direct decisions of the Apex Court which seem to be taking a view that sanction for prosecution for such acts would not be necessary. As already noted in case of M.P. Gupta (supra), Apex court made such observations. These observations were reiterated in case of N. Bhargavan Pillai (supra) and thereafter, in case of Paras Nath Singh(supra). In case of Bholu Ram(supra), the Apex Court observed as under :
"60.
We express our inability to agree with the learned counsel. It is settled law that offences punishable under Sections 409, 420, 467, 468, 471 etc. can by no stretch of imagination by their very nature be regarded as having been committed by a public servant while acting or purporting to act in discharge of official duty' [vide Prakash Singh Badal v. State of Punjab"
(18.6) In case of Prakash Singh Badal(supra), the Apex Court held as under :
"50.The offence of cheating under Section 420 or for that matter offences relatable to Sections 467, 468, 471 and 120B can by no stretch of imagination by their very nature be regarded as having been committed by any public servant while acting or purporting to act in discharge of official duty. In such cases, official status only provides an opportunity for commission of the offence."
(18.7) Reverting back to some of the allegations on record, one may recall that it is the case of the prosecution that several documents were fabricated and forged to create land revenue records to facilitate entire land deal. Allegations have been made that with the help of Talati-cum-Mantri and other officers, revenue entries were fabricated and documents were created to show entries which did not reflect the true Government record. It is also the allegation that permission of Non Agricultural Use was obtained on incorrect declarations made on blank papers purportedly signed by the original land owners. Such act or omission can have no relation to discharging of official duties by a Government servant. Coupled with observations of the Apex Court noted above, I have no hesitation in holding that insofar as allegation of forgery is concerned, sanction for prosecution was not necessary.
(18.8) With respect to allegation of cheating, entire prosecution case is based on theory that accused no.1,2 and 3 connived and conspired with other accused to sale land to IPCL at price much higher than correct and true market price. Accused No.1 was the Managing Director of IPCL. Accused No.2 was Director (Finance) of IPCL. Accused No.3 is a retired IAS officer who had acted as consultant to IPCL. Whether the decision to purchase the land for housing purpose for IPCL and all acts done in furtherance thereof were within the domain of Managing Director or not and what nature of duty and responsibilities, the Director(Finance) enjoyed are questions which may be germane to decide whether such acts can be stated to be in discharge of the duties of a public servant or even in purported discharge of such duties. Question would also be whether such duty was within domain of Board of Directors of IPCL and Managing Director did not just exceeded his authority, had acted wholly without any authority. If that be so, surely no action taken by him can be stated to be in discharge of or purported discharge of his official duty. If on the other hand, the Managing Director had authority to act for and on behalf of IPCL and undertook task of acquiring such land, surely action taken by him in furtherance of such duty would attract the provisions of Section 197 of the Code of Criminal Procedure and no Court would take cognizance of offence arising out of such discharge of his official duty even if there are allegations that in the process he committed certain offences punishable under the IPC.
(18.9) Such issues in my opinion however, are not required to be concluded in the present proceeding and must be left to be judged by the trial Court and would depend on evidence that may be produced at the time of trial. In this regard one may refer to decision of the Apex Court in case of Prakash Singh Badal(supra), wherein it was observed as under :
"38 The question relating to the need of sanction under Section 197 of the Code is not necessarily to be considered as soon as the complaint is lodged and on the allegations contained therein. This question may arise at any stage of the proceeding. The question whether sanction is necessary or not may have to be determined from stage to stage."
(18.10) In case of Bholu Ram(supra), the Apex Court observed that :
"61.
The Revisional Court was aware of legal position. It was, however, held by the Court that at the most there was negligence on the part of respondent No.2 but there was no criminal intent and he cannot be held criminally liable. We have already held that mens rea can only be decided at the time of trial and not at the stage of issuing summons. Moreover, a point as to need or necessity of sanction can be taken during the conduct of trial or at any stage of the proceedings. Hence, proceedings could not have been quashed on the ground of want of sanction in the present case. The order of the Revisional Court deserves to be set aside even on that ground."
(18.11) Under the circumstances looking to the nature of materials on record, I am of the opinion that question whether sanction of prosecution under Section 197 of the Code of Criminal Procedure with respect to offences punishable under Section 420 and 423 of the IPC with respect to accused no. 1 and accused no.2 is not necessary and must be left to be judged at the time of trial.
[4) With respect to all or any of the accused, is case of discharge made out from the facts on record ?
This brings me to question whether all accused have made out any case for discharge. Since materials against accused gathered by the prosecution overlaps and contention of counsel also overlap, it would be convenient to discus the same together.
Before adverting to factual aspects, the approach that Court is required to take while examining discharge application as set out by the Apex Court may be noted.
(20.1) In case of Sanghi Brothers(Indore) Pvt. Ltd.(supra), the Apex Court in this regard observed as under :
"8.
Sections 227, 239 and 245 deal with discharge from criminal charge. In State of Karnataka v. L. Muniswamy (1977 (2)SCC 699) it was noted that at the stage of framing the charge the Court has to apply its mind to the question whether or not there is any ground for presuming the commission of offence by the accused.(Underlined for emphasis). The Court has to see while considering the question of framing the charge as to whether the material brought on record could reasonably connect the accused with the trial. Nothing more is required to be inquired into (See Stree Atyachar Virodhi Parishad v. Dilipbhai Nathumal Chordia(1989(1)SCC 715) and State of West Bengal v. Mohd. Khalid (1995(1)SCC 684).
(20.2) In case of P. Vijayan (supra), the Apex Court held as under :
"11.
At the stage of Section 227, the Judge has merely to sift the evidence in order to find out whether or not there is sufficient ground for proceeding against the accused. In other words, the sufficiency of ground would take within its fold the nature of the evidence recorded by the police or the documents produced before the Court which ex facie disclose that there are suspicious circumstances against the accused so as to frame a charge against him."
(20.3) From series of decisions of Apex Court, it could be gathered that at the stage of discharge, the Court has merely to sift the evidence in order to find out whether or not there is sufficient ground for proceeding against the accused.
(20.4) In case of Niranjan Singh Karam Singh Punjabi, Advocate v. Jitendra Bhimraj Bijjaya and others reported in (1990) 4 Supreme Court Cases 76, wherein the Apex Court observed as under :
"6.
The next question is what is the scope and ambit of the 'consideration' by the trial court at that stage. Can he marshal the evidence found on the record of the case and in the documents placed before him as he would do on the conclusion of the evidence adduced by the prosecution after the charge is framed? It is obvious that since he is at the stage of deciding whether or not there exists sufficient grounds for framing the charge, his enquiry must necessarily be limited to deciding if the facts emerging from the record and documents constitute the offence with which the accused is charged. At that stage he may sift the evidence for that limited purpose but he is not required to marshal the evidence with a view to separating the grain from the chaff. All that he is called upon to consider is whether there is sufficient ground to frame the charge and for this limited purpose he must weigh the material on record as well as the documents relied on by the prosecution. In the State of Bihar v. Ramesh Singh, [1978] 1 SCR 257 this Court observed that at the initial stage of the framing of a charge if there is a strong suspicion-evidence which leads the Court to think that there is ground for presuming that the accused has committed an offence then it is not open to the Court to say that there is no sufficient ground for proceeding against the accused. If the evidence which the prosecutor proposes to adduce to prove the guilt of the accused, even if fully accepted before it is challenged by cross-examination or rebutted by the defence evidence, if any, cannot show that the accused committed the offence, then there will be no sufficient ground for proceeding with the trial. In Union of India v. Prafulla Kumar Samal & Anr., [1979] 2 SCR 229, this Court after considering the scope of section 227 observed that the words 'no sufficient ground for proceeding against the accused' clearly show that the Judge is not merely a post-office to frame charge at the behest of the prosecution but he has to exercise his judicial mind to the facts of the case in order to determine that a case for trial has been made out by the prosecution. In assessing this fact it is not necessary for the court to enter into the pros and cons of the matter or into weighing and balancing of evidence and probabilities but he may evaluate the material to find out if the facts emerging therefrom taken at their face-value establish the ingredients constituting the said offence. After considering the case law on the subject, this Court deduced as under:
"(1) That the Judge while considering the question of framing the charges under section 227 of the Code has the undoubted power to sift and weigh the evidence for the limited purpose of finding out whether or not a prima facie case against the accused has been made out.
Where the materials placed before the court disclose grave suspicion against the accused which has not been properly explained the Court will be fully justified in framing a charge and proceeding with the trial.
The test to determine a prima facie case would naturally depend upon the facts of each case and it is difficult to lay down a rule of universal application. By and large however if two views are equally possible and the Judge is satisfied that the evidence adduced before him while giving rise to some suspicion but not grave suspicion against the accused he will be fully within his right to discharge the accused.
That in exercising his jurisdiction under section 227 of the Code of Judge which (sic) under the present Code is a senior and experienced Judge cannot act merely as a Post office or a mouth-piece of the prosecution, but has to consider the broad probabilities of the case, the total effect of the evidence and the documents produced before the Court, any basic infirmities appearing in the case and so on. This however does not mean that the Judge should make a roving enquiry into the pros and cons of the matter and weigh the evidence as if he was conducting a trial."
(20.5) Bearing in mind the above parameters, if one reverts back to the material on record, prosecution theory as noted and repeated is that accused no.1 being Managing Director of IPCL and accused no.2 being Director(Finance) in connivance with accused no.3 who was retired IAS officer and who was appointed as consultant, purchased the land from M/s. MP Traders at highly inflated rate and thereby caused serious financial loss to IPCL. Other accused conspired with above-mentioned accused in commission of offence. Above theory is sought to be supported by prosecution on basis of several circumstances and materials.
Some of the salient features are as follows :
1) Even before inviting bids from interested parties, accused no.3 in his letter dated 24.8.1998 to accused no.1 suggested that they can purchase the land either by giving advertisement in paper or directly negotiate with M/s. MP Traders. Prosecution suggest that at that stage M/s. MP Trader was never in picture despite which accused no.3 suggested that one mode of acquisition of land could be negotiation with said M/s. MP Traders.
2) As per the prosecution at all crucial stages, Board of Directors of IPCL was kept out of picture by accused no.1 and 2. Some of the important decisions which either required approval or at any rate communication to the Board were never communicated. For example, appointment of Shri Bijlani as consultant was never conveyed to the Board. Payments were made in excess of financial limitation without proper sanction. Land ultimately purchased was far in excess of requirement of IPCL.
3) It is also case of the prosecution that M/s. MP Traders were not even owners of the land on the date on which they had offered land for sale. The advertisement invited bids for sale of non agricultural lands. Time of 10 days was granted to interested bidders. M/s. MP Traders which offered the land was not of their ownership and in any case were not granted Non Agricultural Use permission. They therefore, offered the lands which were yet to be converted into NA lands.
4) However, to meet the deadline of 10 days indicated in the advertisement, certain documents were fabricated with the help of Talati-cum-Mantri and Circle Inspector. Entries were made in the Revenue records which were bogus and fictitious and did not reflect the true position in the original Government records. Even before the names of partners of M/s. MP Traders were entered in the land record, certified entries of such lands were issued indicating that names have already been registered.
5) Shri Bijlani did not put any dates on the tenders of M/s. MP Traders and entire sanctity of the tenders was destroyed since no person other than Shri Bijlani was present when the tenders were opened. Hefty commission was paid to Shri Bijlani by M/s. MP Traders rooting the money through the accused no.10 and 11 who were in business of cheque discounting.
6) Sale price of the lands were split into three parts, a part of the sale proceedings was shown as crop compensation. Once again services of accused no. 10 and 11 were utilised to make a show that such crop compensation was actually paid to the farmers.
7) It is also the case of the prosecution that price ultimately negotiated with M/s. MP Traders was exorbitant. In the FIR itself it is stated that M/s. MP Traders had purchased the land for total consideration of Rs.9,02,375/- from the farmers during the period between January 1999 to April 1999 and in July 1999, same was offered to IPCL for total cost of Rs.2,18,75,274/-. The prosecution has brought certain documents on record to suggest that prevailing market price of the lands having similar situation and other benefits was much lesser. In this regard services of Government Valuation Officer was taken to obtain an inflated valuation report.
To my mind this cannot be said to be case where there is no evidence against the accused to proceed further. Looking to the evidence on record with limited purpose of ascertaining whether there is sufficient evidence to frame charge against the accused, it cannot be stated that in case of any of the accused, case of discharge is made out.
[Q-5 Can it be stated that none of the offences stated in the charge-sheet have been disclosed as contended by learned counsel Shri S.V. Raju?] The contention that even from the material on record, no case of forgery is made out cannot be accepted. Case of the prosecution on the strength of materials collected during the investigation is that several documents in the nature of village records were presented before IPCL which contained entries not forming part of the original records.
(23.1) Offence of forgery is defined in Section 463 of the Indian Penal Code as under :
463. Whoever makes any false documents or false electronic record or part of a document or electronic record, with intent to cause damage or injury to the public or to any person, or to support any claim or title, or to cause any person to part with property, or to enter into any express or implied contract, or with intent to commit fraud or that fraud may be committed, commits forgery.
(23.2) Thus any person making any false documents or part of the document with the intent to cause damage to the public or any person or to support any claim or title or to cause any person to part with property or to enter into any express or implied contract or with intent to commit fraud or that the fraud may be committed can be stated to have committed forgery.
(23.3) Section 464 of the IPC explains the term making a false document. Relevant portion reads as under :
"464.
Making a false document.--A person is said to make a false document-
First.-Who dishonestly or fraudulently -
(a) makes, signs, seals or executes a document or part of a document,
(b) makes or transmits any electronic record or part of any electronic record;
(c) affixes any digital signature on any electronic record;
(d) makes any mark denoting the execution of a document, or the authenticity of the digital signature with the intention of causing it to be believed that such document or part of a document, electronic record or digital signature was made, signed, sealed, executed, transmitted or affixed by or by the authority of a person by whom or by whose authority he knows that it was not made, signed, sealed or executed, or at a time at which he knows that it was not made, signed, sealed, executed, or affixed; or Secondly.-Who, without lawful authority, dishonestly or fraudulently, by cancellation or otherwise, alters a document or an electronic record in any material part thereof, after it has been made or executed or affixed with digital signature either by himself or by any other person, whether such person be living or dead at the time of such alteration;
Thirdly.-Who dishonestly or fraudulently causes any person to sign, seal, execute or alter a document or an electronic record or to affix his digital signature on any electronic record knowing that such person by reason of unsoundness of mind or intoxication cannot, or that by reason of deception practised upon him, he does not know the contents of the document or electronic record or the nature of the alteration."
(23.4) Term 'dishonestly' and 'fraudulently' have been defined under Section 24 and 25 respectively of IPC which reads as under :
"24.
"Dishonestly".--Whoever does anything with the intention of causing wrongful gain to one person or wrongful loss to another person, is said to do that thing "dishonestly".
25. "Fraudulently".--A person is said to do a thing fraudulently if he does that thing with intent to defraud but not otherwise."
(23.5) It can thus be seen that if allegations of the prosecution are correct, it can certainly be stated that accused committed the act with intention of causing wrongful gain to them which would also lead to a wrongful loss to the company. The alleged action of creating Government documents with respect to the land in question contained non existent entries. This clearly falls within the sub-clause(a) of clause First of Section 464 of IPC namely, that of person dishonestly making signing, or executing a document or part of a document with an intention of casing it to be believed that such document or part of the document, was made, signed, sealed executed by the appropriate authority.
(23.6) In turn if it is found that accused had made a false document in terms of provisions contained under Section 463 of the IPC, they (if so established) having made such false documents with intent to cause damage to the public or to any person or to support any claim or title or to enter into any contract or with intent to commit fraud, can be stated to have committed fraud. This contention of the counsel for the petitioner is therefore, not accepted.
The contention that there is no case of forgery of documents cannot be made out since prosecution's case is that several documents in the form of village record were presented before IPCL which contained entries not forming part of original Government records.
Offence of cheating is made out on the face of the record since as per the prosecution large amount of money was paid to M/s. MP Traders by way of sale consideration of lands purchased by IPCL at highly inflated cost.
The contention that since lands were purchased through public tenders, prices negotiated must be taken to be best available market price, also cannot be ground to discharge any of the accused. As noted, stand of the prosecution is that only 10 days were permitted to the tenderer to make an offer. Tender required that land should be non agricultural land with necessary Non Agricultural Use permission and further title of the land should be clear and land should not have encumbrances. It is the prosecution case that land offered by M/s. MP Traders failed all three tests. To begin with lands were not NA lands. Secondly titles were not clear, some cases there were disputes pending with the Court. M/s. MP Traders and partners were not the owners of the land when the lands were offered for sale. In some lands there were even possessory disputes.
Learned counsel for the accused however, submitted that all disputes were later on cleared, lands were converted into NA lands. M/s. MP Traders completed the title and passed the same to IPCL in due course. However, this does not seem to suggest that on the date when the offer was made, tenderer offered lands which fulfilled necessary conditions. Had the conditions been relaxed in favour of other offerers, it would be entirely possible that other lands also would have been offered for sale and price would have been more competitive. M/s. MP Traders' offer was entertained and accepted though the lands that were offered did not fulfill the most basic and necessary conditions of being NA lands, of being clear in title and having no encumbrances. It is therefore, begging the question by suggesting that price negotiated through public tender must necessarily be accepted as lowest possible price.
It was contended that there is no evidence of any conspiracy. I have already recorded salient features of prosecution theory. As per the prosecution there was a systematic effort on part of the accused to defraud public exchequer and siphon away IPCL's funds. They have also projected different steps and modus operandi and the manner in which entire scheme was put in action, starting with calling for tenders for purchase of land on emergency basis, appointment of Shri Bijlani as consultant, purchase of land in excess of requirement of IPCL, favouring M/s. MP Traders despite defects in offer, payment of commission to Shri Bijlani by M/s. MP Traders through accused no. 10 and 11, reaching of crop compensation component sale price back to M/s. MP Traders making show on record that farmers were individually paid and in the meantime also presenting documents of land which according to the prosecution were forged, showing entries in revenue records which did not exist in Government books, as per the prosecution all these would reflect a systematic and preplanned conspiracy between accused. In such case consequentially and necessarily direct evidence of conspiracy between the parties would always be rarity. However, as has been observed in various decisions of the Courts, conspiracy can also be proved by circumstances. For the purpose of discharge however, there is sufficient evidence to proceed further with the case on basis of materials on record.
[(Q.6) What order.] Before closing, it is made abundantly clear that I have expressed no opinion on reliability or even admissibility of evidence on record. I have only examined the materials presented by the prosecution with the limited purpose of finding out whether any case of discharge is made out or not. In other words, my limited scrutiny has been if such evidence is ultimately proved before the Court, was there a clear possibility of recording conviction of the accused or not. It is only with that purpose and aim in mind that I have discussed the prosecution's case. I have not slightest hesitation to express any opinion on guilt or innocence of accused. Such issues shall have to be judged by the trial Court upon completion of recording of evidence and conduct of trial. Any observations even inadvertently made in this order will not affect the defence of the accused.
With above observations, all petitions are dismissed.
Learned counsel appearing for all the petitioners at this stage, requested for extension of stay previously granted by this Court. However, in facts of the case, I am not inclined to extend the stay. This request is therefore, rejected.
(Akil Kureshi,J.) (raghu) Top