Heard learned counsel for the parties.
1 This group of petitions is filed by accused Nos. 1, 2, 3 and 7 of Special Case No.31 of 2003 challenging the order dated 24th February 2010 passed by the learned Special Judge, CBI Court No.4, Mirzapur, Ahmedabad, in which, the petitioners face a charge sheet pursuant to an offence which came to be registered with the Central Bureau of Investigation, Gandhinagar, under Sections 120-B read with Section 420 of the Indian Penal Code and Section 15(2) read with Section 13(1)(d) of the Prevention of Corruption Act, 1988 on 19th April 2001, where the allegations are to the extent that all the accused have entered into a criminal conspiracy with each other during the year 1998-1999 in the matter of purchase of 35 acres of land for the Emergency Township of IPCL, Gandhar Complex, District Bhrauch, in July 1999 from accused No.6, M.P. Traders, Bharuch, at an exorbitant price of Rs.6,25,000/- per acre as against Rs.40,470/- per acre fixed by the Land Price Committee chaired by the District Collector, Bharuch, by violating the procedure and objections raised by the Tender Evaluation Committee of IPCL.
2 Various contentions were raised in the applications preferred by the accused under Section 227 of the Code of Criminal Procedure for discharge before the learned Special Judge, Court No.4, at Mirzapur, Ahmedabad.
3 So far as accused No. 1 is concerned, Mr. K.S. Nanavati, learned Senior Advocate, has contended that he being an employee of the government company; his service conditions are governed as per the Rules framed under Article 311 of the Constitution of India; the appointment of accused No.1 as Chairman-cum-Managing Director was sanctioned by the President of India and to be terminated also by the President of India, the sanction, as required under Section 197 of the Code, is a mandatory requirement and, by not availing sanction, filing of charge sheet and proceeding of Special Case are illegal. So far as charge against accused No. 1 under Section 13(1)(d) of the Prevention of Corruption Act, 1988 is concerned, there is allegation with regard to monetary gain and, therefore, ingredients of above section are not attracted. It is further submitted that two ingredients must exist to make out an offence under Section 13(1)(d), namely, monetary benefit and pecuniary advantage. It is further submitted that the IPCL is a government owned company where the Government of India has a stake of 59.95 per cent in the equity and considering the nature of appointment and service regulations and conditions, sanction under Section 197 of the Code is necessary. In support of the above arguments, the learned counsel has placed reliance mainly on the decision of the Apex Court in the case of State of Madhya Pradesh vs. Sheetla Sahai and others, reported in (2009) 8 Supreme Court Cases 617 and submitted that, without there being an order of sanction under Section 197 of the Code, no cognizance could have been taken by the Court.
3.1 Even on merit also, certain arguments have been canvassed about urgency of acquisition of land for the purpose and the requisition sent to the Gujarat Industrial Development Corporation for providing land was not finalized in view of the demand of Rs.21 crores towards development of the land and the price of the land and, thereafter, the land in question was purchased at the lower rate than what the GIDC had offered. It is also submitted that accused No.1 had the authority and power to undertake the procedure for acquiring the land and, accordingly, in discharge of his official duties as Chairman-cum-Managing Director of the company, the process was undertaken. It is further submitted, without prejudice to the rights and contentions of the accused, that in the case of irregularities or negligence, criminal element cannot be incorporated in performance of duties. In support of the above contentions, the following decisions are relied upon:
[i] AIR 1955 SC 287 Ramayya vs. State of Bombay [ii] AIR 1955 SC 309 Amrik Singh vs. state of Pepsu [iii] AIR 1966 Supreme Court 220 Baijnath vs. State of MP [iv] AIR (35) 1948 Privy Council 128 HHB Gill vs. The King
(v) AIR (35) 1948 Privy Council 156 Albrt West Meads vs. The King [vi] AIR (35) 1948 Privy Council 159 United Provinces vs. Electricity Distributing Co.
4 Mr.
Mihir Thakore, learned Senior Advocate, has submitted that so far as accused No.7 in the capacity of the valuer is concerned, he acted as per the direction issued by the Authority and as per the communication dated 23rd March 1999 he was specifically asked to value the land as if it is a non-agricultural land and after obtaining comparative data of the land in the surrounding areas and other necessary documents by following procedure, valuation report was submitted. At no point of time, he entered into any kind of conspiracy. He is not a government employee and the Prevention of Corruption Act does not apply and, if the main charge against accused No.1 fails, no charge under Section 120B survives.
5 Mr.
B.P. Tanna, learned Senior Advocate, has submitted that so far as the amounts received by the accused No.3 in various accounts of the Bank are concerned, it reflects only one side of the story and the document Nos. 150, 151, and 154 indicate reverse entries but a picture is created that accused No.3 is involved in the offence. It is further submitted that in the transactions which have taken place, the entries which were made are pertaining to the job performed by accused No.3 in the capacity of consultancy and, if any commission is availed, it cannot be said that it is a wrongful gain on his part attracting any of the provisions under Section 420 of the Code and that there was no dishonest intention on his part, but performed the job as consultant.
6. Learned counsel for accused No.2 submits that he adopts the contentions of the learned counsel for accused No.1.
7. At the outset, Mr. Yogesh Ravani, learned Senior Standing Counsel appearing for the CBI, prosecuting agency, has opposed maintainability of the revision petition against the interlocutory order of the learned Special Judge refusing to accept the application for discharge by the accused. He has also vehemently opposed to any relief being granted by entertaining these applications on the ground that the petitioners are accused in serious offences. He has submitted that no sanction under Section 197 of the Code is necessary in case where offences under Sections 406, 420, 467, etc. are registered and, in support of his submission, he placed reliance on the following judgments of the Apex Court:
[a] 2005 SCC Crime 415 : State of Orissa vs. Debendra Nath Padhi [b] [2009] 6 SCC 372 State of UP vs. Paras Nath Singh He has further submitted that the averments in the chargesheet if read as a whole will certainly disclose the ingredients of offences and even the Tender Committee also objected to the procedure adopted by accused Nos. 1, 2 and 3 and the finalization of transaction and sanction of payment beyond the authorized capacity or power of accused No.1 will reveal that there was conspiracy and intention to cheat. He has further submitted that the employee of the government company or even a person who is on deputation and receiving salary from such company, cannot be said to be a 'public servant' and is not entitled to any protection under Section 197 of the Code and, in support of his submission, he placed reliance on the following judgments of the Apex Court:
[a] [2005] 13 SCC 213 : N.K. Sharma vs. Abhimanyu [b] [1981] 3 SCC 431 : S.S. Dhanoa vs. Municipal Corporation, Delhi and others.
He has further submitted that after collecting sufficient and relevant materials and statements recorded, charge sheet is filed.
8 In rejoinder, Mr. K.S.Nanavati, learned Senior Advocate, has submitted that it would amount to rewriting the statutory provision if Section 197 is read to exclude certain offences. In fact, the test to be applied is as to whether offence charged is an act relatable to official duty of the accused in virtue of his office. Prima-facie, the Court has to examine what is the act alleged against the accused in the chargesheet and such act can be said to be relatable in discharge of official duty.
9 The learned counsel appearing for both the parties have placed reliance on interpretation of Section 197 of the Code as well as Section 13(2) of of the Prevention of Corruption Act, 1988 and submitted that a plain reading of Section 197 of the Code mandates sanction in the case of a public servant who has discharged his duty as a public servant.
10 Having heard the learned counsel appearing for the parties, considering the facts of the case, on perusal of the first information report and the order dated 24th February 2010 passed by the learned Special Judge, interpretation put forth of Section 197 of the Code, prima-facie, a case is made out to admit these matters which deserve consideration at length.
11 Hence, Rule returnable on 29th June 2010. Status-quo qua the proceedings impugned to continue till then. Service of Rule is waived by the learned counsel appearing for the respective respondents.
(ANANT S. DAVE, J.) (swamy) Top