Delhi District Court
Cbi vs . Narayan Diwakar & Ors. on 30 November, 2022
IN THE COURT OF RUBY ALKA GUPTA
SPECIAL JUDGE (PC ACT) (CBI)-16
ROUSE AVENUE DISTRICT COURTS, NEW DELHI.
CBI Vs. Narayan Diwakar & Ors.
(CBSE CGHS)
CBI No.83/19
CNR No. DLCT110003512019
Central Bureau of Investigation
Versus
1. Narayan Diwakar (A-1)
S/o Late Sh. Chatti Lal
R/o G-30, Masjid Modh,
Greater Kailash Part-II,
New Delhi-48.
Permanent address:
Village & PO- Baraghania,
District Sita Marhi
Bihar.
2. Jitender Singh Sharma (A-2)
S/o Late Sh. N. S. Sharma
R/o 1073/A-3, Ward No. 1
Mehrauli,
New Delhi.
(Proceedings qua him stood abated vide order dated
09.10.2021)
3. Raman Verma (A-3)
S/o Sh. J. N. Verma
R/o F-444, Karampura,
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022
(CBSE CGHS) Page 1 of 103
CBI No. 83/19
New Delhi.
4. Gokul Chand Aggarwal (A-4)
S/o Late Sh. Jagdish Prasad
R/o A-603, Ashoka Apartments,
Sector-9, Rohini,
Delhi-85.
5. Prahlad Kumar Thirwani (A-5)
S/o Late Sh. Moti Ram Thirwani
R/o 348-E, Pocket-II
Mayur Vihar, Phase-I
Delhi-110091.
(CBSE CGHS)
Date of Institution: 31.10.2006
Date of Arguments: 06.10.2022
Date of Judgment: 30.11.2022
JUDGMENT
1. "Considering that enormous amount of money that had been pumped in and invested by the influential Builder mafia and other vested interests, collusion and complicity of the staff and officials of RCS and others to hijack the societies," CBI was directed to thoroughly investigate several co-operative group housing societies by the Hon'ble High Court of Delhi.
(The Yogi Raj Krishna Co-operative Group Housing Society Ltd. Vs. DDA & Anr., WP(C) No. 10066/2004.) CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 2 of 103 CBI No. 83/19
2. One of such co-operative group housing societies, CBSE Employees CGHS Ltd. (hereinafter referred to as CBSE CGHS or the Society) was registered with the office of the Registrar of Co- operative Societies (hereinafter referred to as the office of the RCS) vide registration no. 1587 (GH) on 09.02.1984 with 68 promoter members with its registered office at C-20, Community Centre, Naraina, New Delhi. A list of 115 members of CBSE CGHS was approved on 05.09.2003 by the then RCS and the said list was forwarded for allotment of land to DDA. It is alleged that the said list of 115 members was approved as a result of a criminal conspiracy between the accused persons and for that purpose, false and forged documents were used.
3. In pursuance of the orders of the Hon'ble Delhi High Court as referred above, preliminary enquiry (hereinafter referred to as PE) bearing no. BD1 2005 E 0006 was conducted in respect of CBSE CGHS. On conversion of the said PE, the present regular case was registered on 31.10.2005 under Sections 120B r/w 419, 420, 468, 471 Indian Penal Code (hereinafter referred to as IPC) and substantive offences under Sections 419, 420/511, 468, 471 IPC and Sections 13 (2) r/w 13 (1) (d) Prevention of Corruption Act, 1988 (hereinafter referred to as PC Act) & 15 r/w Section 13 (1) (d) PC Act against:
i. The then Registrar of Co-operative Societies, Narayan Diwakar;
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 3 of 103 CBI No. 83/19 ii. The then Asstt. Registar, J. S. Sharma;
iii. The then Dealing Asstt./UDC, Raman Verma; iv. Gokul Chand Aggarwal;
v. B. S. Kohli;
vi. and other unknown persons
4. Upon completion of the investigation, charge-sheet was filed against all the above stated accused persons except B. S. Kohli. P. K. Thirwani, Head Clerk in the office of RCS was also named as an accused in the charge-sheet. The charge-sheet was filed under Sections 120B IPC r/w 419, 420, 468, 471 IPC and Sections 13(2) r/w Section 13(1)(d) PC Act, 1988; substantive offences under Sections 15 r/w 13 (1) (d) PC Act, 1988 against A1 Narayan Diwakar, A2 J. S. Sharma, A3 Raman Verma and A5 P. K. Thirwani and substantive offences under Sections 419, 420/511, 468, 471 IPC against A4 Gokul Chand Aggarwal.
Proceedings in the case
5. After taking cognizance, accused persons were supplied the copies of the chargesheet and documents. After hearing the parties, vide order dated 09.03.2011, the Ld. Predecessor held charge to be maintainable as follows, against:
(i) All five accused persons i.e. A1 Narayan Diwakar, A2 J. S. Sharma (since deceased), A3 Raman Verma, A4 Gokul Chand Aggarwal and A5 CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 4 of 103 CBI No. 83/19 P. K. Thirwani: under Section 120B IPC; Sections 120B IPC r/w Section 420 IPC r/w 511, 419, 468 & 471 IPC & Section 15 r/w 13 (2) r/w 13(1) (d) PC Act, 1988;
(ii) Public servants i.e. A1 Narayan Diwakar, A2 J. S. Sharma (since deceased), A3 Raman Verma and A5 P. K. Thirwani: under Section 15 r/w 13 (2) r/w 13(1) (d) PC Act, 1988; and
(iii)A4 Gokul Chand Aggarwal: under Section 420 r/w 511, 419, 468 & 471 IPC.
Charges were accordingly framed. All accused persons pleaded not guilty and claimed trial.
6. The prosecution examined 61 witnesses. These 61 witnesses can be grouped and categorized as follows:
1 Witnesses from the PW 36 Sh. J. N. Gupta office of RCS PW 48 Sh. Dharamvir Singh and PW 58 Sh. Rakesh Bhatnagar 2 Witnesses from DDA PW 43 Sh. Damodar Sati and PW44 Sh. Krishan Gopal Kashyap 3 Witnesses with respect PW 49 Sh. Rajneesh Tingal to the sanction u/s 19 PW 56 Sh.R.Narayanaswami and PC Act PW 60 Sh. A. Majumdar 4 Witness from Delhi State PW 50 Sh.Surinder Kumar Abrol Co-operative Bank Ltd.
where CBSE CGHS maintained its account 5 Witnesses from CBI PW 51 Sh. C.S. Prakashnarayanan PW 52 Insp. Vishal PW 53 Insp. V. S. Yadav and CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 5 of 103 CBI No. 83/19 PW 61 Insp. D. Damodaran 6 GEQD Expert PW 57 Dr. Ravindra Sharma is the Deputy GEQD, CFSL, Shimla.
7 PW 55 Sh. Gaurav The son of the deceased
Gupta Advocate/Notary Public whose
stamps have been used to falsely
attest affidavits of members of
the society, to be submitted in
the office of RCS for procuring
the approval of the list of
members.
8. Fake Members PW 40 Sh. Brij Mohan Gupta
(including witnesses PW 41 Ms. Rajni Gupta
examined to show PW 42 Ms. Sarita Gupta
fake membership) PW 45 Sh. S. P. Aggarwal
PW 47 Sh. Dinesh Pandey and
PW 59 Ms. Madhu Aggarwal.
9 The remaining witnesses are members of CBSE CGHS.
7. The details of the witnesses examined by CBI, their nature and the documents exhibited in their respective testimonies are reflected in the Table A annexed to this judgment as Annexure A:
8. Statements of A1 Narayan Diwakar, A2 J. S. Sharma, A3 Raman Verma and A5 P. K. Thirwani under Section 313 Cr. P.C. were then recorded. A1 Narayan Diwakar, A2 J. S. Sharma and A5 P. K. CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 6 of 103 CBI No. 83/19 Thirwani chose not to lead evidence in their defence while A3 Raman Verma wished to lead evidence in his defence. Before statement of A4 Gokul Chand Aggarwal could be recorded under Section 313 Cr. P.C., the proceedings in the matter were stayed by order dated 02.09.2013 of the Hon'ble Supreme Court. The appeal wherein the stay was granted was subsequently withdrawn on 26.04.2018. A4 Gokul Chand Aggarwal did not appear thereafter due to which NBWs were issued against him, leading to process under Section 82 Cr. P.C. being issued against him. A4 Gokul Chand Aggarwal was declared proclaimed offender vide order dated 12.09.2018 after following the due process.
9. Vide order dated 13.11.2018, the Hon'ble High Court of Delhi directed that no final order would be passed by the trial court in the case though proceedings could continue. Recording of defence evidence on the part of A3 Raman Verma was completed. He examined three witnesses in his defence. The details of these three defence witnesses are given in the Table B annexed to this judgment as Annexure B.
10. As noted in order dated 03.09.2020 passed by the Ld. Predecessor, the petition wherein order dated 13.11.2018 was passed was disposed off on 28.02.2020. The petition was withdrawn by A3 Raman Verma. Thereafter, another Writ Petition had been filed. As CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 7 of 103 CBI No. 83/19 noted in order dated 14.10.2020, the court was informed by the Ld. Defence Counsel that the Hon'ble High Court of Delhi has directed this court to proceed with hearing the arguments and pass judgment and if any accused is convicted, to pass order of sentence. However, the convict shall not be taken into custody. Sh. Anil Kumar, Ld. Counsel for A3 Raman Verma filed a copy of some orders passed by the Hon'ble High Court of Delhi in the above-stated Writ Petition. Several petitions were directed to be taken up together. Order dated 07.10.2020 passed in the said Writ Petition directed the trial court to proceed with the cases and hear submissions of the parties. Further, the trial court could also pronounce judgment and in case the accused/petitioners therein were held guilty, to pronounce the order on sentence. However, the petitioners before the Hon'ble High Court of Delhi would not be taken into custody. In the present case, only A3 Raman Verma is a petitioner in the said bunch matters pending before the Hon'ble High Court of Delhi.
11. On 29.07.2021, it was informed that A2 J. S. Sharma had expired. Death verification report of A2 J. S. Sharma was received and the proceedings were abated qua A2 J. S. Sharma on 09.10.2021.
12. In the meantime, A4 G. C. Aggarwal was apprehended in another case. Production warrants were issued and he was produced on 09.10.2021. He is in judicial custody since then. Statement of A4 CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 8 of 103 CBI No. 83/19 G. C. Aggarwal was thereafter recorded under Section 313 Cr. P.C. He chose not to lead evidence in his defence. Submissions were thereafter heard at length on behalf of all parties. File has been perused.
Facts in brief
13. An application dated 13.06.2003 was filed in the office of RCS seeking approval of a list of 115 members of CBSE CGHS and for the said list to be forwarded to DDA for allotment of land. Notes were put up for approval. The file of CBSE CGHS moved up and down in the office of RCS till the said list of 115 members was approved by A1 Narayan Diwakar vide his note dated 05.09.2003.
14. The application dated 13.06.2003 had been signed by 'B. S. Kohli', in his capacity of the President of the Society. During the period the said application was being processed 'B.S. Kohli' had appeared in the office of RCS on various dates. He had also furnished 'records' of the Society. It is alleged that false and forged documents had been furnished on behalf of the Society by A4 Gokul Chand Aggarwal who had also appeared in the office of RCS, impersonating as B. S. Kohli. It is alleged that A3 Raman Verma who was at that time the Dealing Assistant (hereinafter referred to as the CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 9 of 103 CBI No. 83/19 DA) fraudulently accepted said records from A4 Gokul Chand Aggarwal.
15. B. S. Kohli was the Promoter Secretary of the Society. He was the custodian of all the records of the Society. CBSE CGHS was functional till the year 1990. In furtherance of the aforesaid criminal conspiracy, A4 Gokul Chand Aggarwal took the Membership Register and Proceeding Register from B. S. Kohli in the year 1998. A4 Gokul Chand Aggarwal allegedly forged various documents like affidavits, photocopies of application forms of newly enrolled members, receipts, minutes of meetings as well as audit report for submission in the office of RCS. Names of his friends and relatives were added in the list of members to raise the strength of the Society to 115.
16. B. S. Kohli was named as an accused in the FIR. However, no criminality on his part was established during investigation. Charge-sheet was thus not filed against him. Instead, he is the star witness of the prosecution. B. S. Kohli denied submitting any application, list of members or producing any documents as mentioned in the notes put up by A3 Raman Verma on various dates.
17. It is further alleged that A3 Raman Verma willfully did not highlight the fact that the Society had changed its address from C-29, CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 10 of 103 CBI No. 83/19 Community Centre, Naraina to Shiksha Kendra, 2 Community Centre, Preet Vihar, Delhi-92. Instead, he falsely mentioned in his note dated 26.08.2005 that the Society had changed its correspondence address from Naraina to Shop No. 25, CSC-1, DDA Market, E-15-16, Sector-8, Rohini, Delhi. The said shop is alloted to A4 Gokul Chand Aggarwal.
18. Towards compliance of all statutory requirements, the Society was required to be audited. J. S. Sharma (since deceased) appointed A5 P. K. Thirwani to conduct the audit from 09.02.1984 to 2001-2002.
19. A5 P. K. Thirwani is alleged to have conducted the audit on the basis of such false and forged documents produced by A4 Gokul Chand Aggarwal. A5 P. K. Thirwani dishonestly and fraudulently submitted a false audit report which contained inherent discrepancies. Some objections were also raised in the audit report qua which a compliance report was also filed by the Society.
20. In furtherance of the criminal conspiracy, A4 Gokul Chand Aggarwal manipulated the records of the Society. False and forged records were created to show that a meeting dated 15.6.2003 was called wherein elections of the Society were held. Managing Committee was formed of B. S. Kohli, Ramesh Chander Sharma, CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 11 of 103 CBI No. 83/19 Madhu Aggarwal, Ganga Ram, Sarita Gupta, Rajni Gupta and Sunil Aggarwal. Some of these were not even members of the Society and have denied attending any meeting. Sh. Balkishan was shown as the Election Officer for conducting the said election. However, said Sh. Balkishan had expired on 13.06.2003. 115 affidavits were submitted in the office of RCS on behalf of each member of the Society. Each affidavit had been notarized by Sh. Arun Kumar Gupta on 14.07.2003. Said Notary had, however, expired on 15.01.2002. Many members denied executing such affidavits while some other purported deponents were not even members of the Society. GEQD opinion was obtained during the investigation which confirmed various forgeries being committed by A4 Gokul Chand Aggarwal.
21. The call detail records of the mobile phone of the then RCS, A1 Narayan Diwakar was taken. The same reflects that he and A4 Gokul Chand Aggarwal were in contact with each other over phone several times.
22. A1 Narayan Diwakar, A2 J. S. Sharma (since deceased), A3 Raman Verma and A5 P. K. Thirwani are alleged to have abused their official positions as public servants by corrupt and illegal means and used as genuine forged documents which they knew or had reason to believe to be forged. The freeze list of members of the Society was CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 12 of 103 CBI No. 83/19 illegally approved and DDA was dishonestly induced to allot land in favour of the Society.
Contentions on behalf of CBI
23. Sh. T. P. Negi, Ld. Special Senior PP submitted on behalf of CBI that the prosecution has proved its case against all accused persons. All the accused persons conspired to get the false list of 115 members approved and forwarded to DDA by the office of RCS. The officials of RCS were required to have verified the records of the Society especially in view of the fact that the Society had restarted functioning after a considerable number of years. There was no honest and diligent effort on behalf of either public servant to verify the records produced. The entire process was an eye wash.
24. The process adopted by the accused public servants is stated to imply that they had made up their minds which in turn implies conspiracy. The DA/A3 Raman Verma willfully did not bring to notice the change in address of the society. The A2 J. S. Sharma (since deceased) in his capacity of the Asstt. Registrar (hereinafter referred to as the AR) recommended approval of freeze list without complying with the directions of the PW58 Rakesh Bhatnagar, who was at that time the Joint Registrar (hereinafter referred to as the JR).
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25. Sh. Negi admitted that the prosecution was required to prove mens rea in respect of the offence under part (ii) of Section 13 (1) (d) PC Act. However, it was contended, that no mens rea is required to be proved in respect of part (iii) thereof. If the public servants have obtained for anyone any valuable thing or pecuniary advantage without any public interests, the offence stands proved against such public servant. The act of the accused public servants was against public interests as they acted in an arbitrary manner, unfairly and unjustly. Ld. Special Senior PP relied upon Runu Gosh vs. CBI, MANU/DE/6909/2011; NOIDA Entrepreneurs Association & Ors. Vs. NOIDA & Ors., MANU/SC/0570/2011; and LIC of India & Ors. Vs. Consumer Education & Research Centre & Ors., MANU/SC/0772/1995 in this respect.
26. The Ld. Special Senior PP submitted that the GEQD opinion established forgeries being done by A4 Gokul Chand Aggarwal. It has also been established that meeting dated 15.06.2003 was manipulated and that false and forged 115 affidavits were filed. The accounts of the Society were fabricated. It is pointed out that A4 Gokul Chand Aggarwal had taken the Membership Register and Proceeding Register from PW 12 B. S. Kohli in 1998. A4 Gokul Chand Aggarwal created false documents to show new enrollments including his family and friends.
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 14 of 103 CBI No. 83/19
27. Having regard to the nature of the offence of criminal conspiracy, the acts of the accused persons, inter alia: creation of false and forged records, putting up of false notes, not verifying the said records, concealing change of address and incorporating the correspondence address as the changed address in the notes, submitting a false audit report, is stated to prove existence of criminal conspiracy between the accused persons. The Ld. Special Senior PP relied upon Order dated 11.05.1999 passed in Crl. Appeal No. 321/1998 by Hon'ble Supreme Court titled as State of T. N. through Superintendent of Police CBI/SIT Vs. Nalini & Ors.; Esher Singh Vs. State of Andhra Pradesh, MANU/SC0223/2004; Order dated 04.08.2005 passed in Crl. Appeal No. 373375/2004 by Hon'ble Supreme Court titled as State of N.C.T of Delhi Vs. Navjot Sandhu @ Afsan Guru; Order dated 14.02.2017 passed in Crl. Appeal No. 300-303 of 2017 by Hon'ble Supreme Court titled as State of Karnataka Vs. Selvi J. Jayalaitha; Order dated 20.08.2001 passed in Crl. Appeal No.357-359 of 1998 by Hon'ble Supreme Court titled as Firozuddin Basheeruddin Vs. State of Kerala; and Habibullah Khan Vs. State of Orissa & Ors., MANU/SC/0218/1995 in support of his case with regards to he law on Section 120B IPC.
28. Sh. Negi also pointed out that no sanction under Section 197 Cr. P.C. was required as it was no part of the official duty of the accused public servants to enter into a criminal conspiracy. He has CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 15 of 103 CBI No. 83/19 relied upon Harihar Prasad & Ors. Vs. State of Bihar, MANU/SC/0114/1971. He also relied upon Raghunath Anant Goviker Vs. State of Maharashtra, MANU/SC/0753/2008; State of M.P. Vs. Sheetla Sahai and Ors., MANU/SC/1425/2009; and Choudhary Parveen Sultana Vs. State of West Bengal & Ors., MANU/SC/0011/2009.
29. Sh. T. P. Negi, Ld. Special Senior PP hence submitted that all the accused persons were liable to be convicted for the offences each had been charged with. He prayed that they be so convicted.
Contentions on behalf of Accused Persons
30. Submissions were forwarded on behalf of each accused person separately. However, certain submissions are common to all. Some such common arguments have been culled out from the individual submissions. These may have been forwarded on behalf of one or more of the accused persons but are largely applicable to all accused persons, or are at least common to the accused public servants.
31. It was submitted on behalf of all persons that no incriminating evidence has been brought on record against either accused. The prosecution is stated to have failed utterly to prove its CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 16 of 103 CBI No. 83/19 case against any of the accused persons. All accused persons are thus stated to be entitled to be acquitted.
32. It was contended on behalf of all accused persons that no complaint was filed by any person or authority in the present case. Thus, there is no aggrieved person or body. Further, no loss was caused to anyone, not even to DDA as land was not alloted to the Society. For the same reason, no benefit was derived from the alleged conspiracy by anyone, not even by the Society.
33. The prosecution is stated to rely on circumstantial evidence. It is submitted that an age-old principle in cases of circumstantial evidence is that the chain of events ought to be complete. However, the evidence led in the present case does not stand the test of the said principle. Sh. Abhishek Prasad, Ld. Amicus Curiae for A1 Narayan Diwakar submitted that the chain was broken upon the JR/PW58 Rakesh Bhatnagar being found to have not been a part of the alleged criminal conspiracy.
34. The essential element of criminal conspiracy, an agreement between the accused persons, is stated to have not been established by the prosecution. No evidence whatsoever is stated to have been brought on record to establish a meeting of minds.
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35. All the public servants are stated to be governed by the Delhi Co-operative Societies Act, 1972 (hereinafter referred to as the DCS Act), Delhi Co-operative Societies Rules, 1973 (hereinafter referred to as the DCS Rules) and the Directives passed thereunder. DCS Act is stated to be a special act. By virtue of Section 5 IPC is stated to be not applicable to the present case. Section 93 of DCS Act is also stated to bar the jurisdiction of Delhi courts. The said accused persons are further stated to enjoy immunity by virtue of Section 95 of DCS Act. Even otherwise, it is contended that no provision of the DCS Act, Rules or Directives has been violated by either accused public servant.
36. Said accused public servants are stated to have had no knowledge of the alleged forgery or impersonation. Testimony of PW 58 Rakesh Bhatnagar is relied upon in this regard. Said PW was the JR at the relevant time. He has deposed that no training was given to the officials of RCS to detect forgery. He and the IO/PW61/Insp. D. Damodaran are stated to have also admitted that the list of members, addition of members and removal of members is the prerogative of the societies. It was submitted that the alleged acts of these accused persons can, at most, be stated to be merely an error in judgment for which they cannot be held criminally liable under any statute.
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37. In any case, it was contended that the allegations against the accused persons are of approving the freeze list dishonestly and fraudulently. It is submitted that membership of any society is the prerogative of such society. The office of RCS has no role in the membership of any society.
38. It was further argued on behalf of all the three accused public servants that sanction under Section 197 Cr. P.C. was not taken in respect of the offences of IPC. It was contended on behalf of all the said accused public servants that they were entitled to be acquitted on this sole ground.
39. With respect to A3 Raman Verma and A5 P. K. Thirwani, it was submitted that the sanction taken under Section 19 PC Act qua them was invalid as the sanction was not taken from the competent authority who was so competent at the time of commission of the alleged offence. Both the said accused persons are stated to be entitled to be acquitted for lack of proper sanction under Section 19 PC Act.
Additional submissions on behalf of A1 Narayan Diwakar
40. In addition to the above stated submissions, Sh. Abhishek Prasad, Ld. Amicus Curiae submitted on behalf of A1 Narayan CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 19 of 103 CBI No. 83/19 Diwakar that the said accused dealt with the file only once, as regards the approval of the freeze list. The file came before him only for the final approval. As such, A1 Narayan Diwakar cannot be said to have dishonestly or fraudulently approved the freeze list as the complete processing had been done by the staff. Further, the JR/PW 58 Rakesh Bhatnagar had approved the recommendation of the DA/A3 Raman Verma to approve the freeze list. He had done so after having raised objections and being satisfied thereafter. The JR/PW 58 Rakesh Bhatnagar has not been arrayed as an accused. It was thus contended that if JR/PW 58 Rakesh Bhatnagar is not liable for approving the forwarding of the recommendation for approval of the freeze list, nor can A1 Narayan Diwakar be. Also, the chain of alleged conspiracy stood broken with the JR/PW 58 Rakesh Bhatnagar raising objections and directing further scrutiny by the DA/A3 Raman Verma.
41. Ld. Amicus Curiae further submitted that the essence of corruption lies in personal greed and a strong urge by a public servant to enrich himself at any cost. In the present case, no benefit has been derived by A1 Narayan Diwakar nor any personal gain or interest has accrued in his favour. The prosecution has not brought any material on record to show that A1 Narayan Diwakar obtained any valuable thing or pecuniary advantage for approving the freeze list, his official act. The Ld. Amicus Curiae has relied upon order dated 10.05.2016 passed by the Hon'ble Supreme Court in A. Sivaprakash vs. State of CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 20 of 103 CBI No. 83/19 Kerala, Crl. Appeal No. 131 of 2007 and Order dated 22.05.2020 passed by the Hon'ble Delhi High Court in Madhu Koda vs. State through CBI, Crl. Appeal No. 1186 of 2017.
42. The RCS is stated to be a quasi judicial authority with powers like a civil court in many aspects. It enjoys exclusive jurisdiction in its field and its orders become final in the eyes of law unless set aside by the competent appellate body which is the Delhi Co-operative Tribunal. By way of the present case, the CBI is stated to have challenged the order passed by A1 Narayan Diwakar in the capacity of RCS and is thus to be sitting in appeal, which is not permitted by the DCS Act. The Amicus Curiae relied upon Thakur Jugal Kishore Sinha vs. Sitamarhi Central Co-operative Bank Ltd. & Anr., 1967 AIR SC 1494 to show that the RCS not only has the trappings of a court but has same powers as given to ordinary civil courts by CPC.
43. The Ld. Amicus Curiae submitted that it is a settled position of law that requisite guilty intent and knowledge is to be proved by the prosecution through credible evidence. The prosecution cannot take refuge of assumption, presumption or suspicion. The reliance upon Runu Ghosh (supra) by CBI is stated to be misplaced.
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44. Another aspect of the alleged conspiracy as per the prosecution case is the CDR of the mobile phone of Narayan Diwakar. It is stated that through the said CDR, the prosecution wishes to establish that A1 Narayan Diwakar was in contact with A4 Gokul Chand Aggarwal. However, the said CDR has not been proved as per law as no Nodal Officer has been examined. Further, it pertains to the period 01.01.2005 to July, 2005 which is much after the period of the alleged conspiracy in the present case as also after the retirement of A1 Narayan Diwakar.
45. It was also submitted that there is no presumption that all officials working in a government department or all those who had dealt with a file questioned in a case of conspiracy are in conspiracy with each other. Ld. Amicus Curiae relied upon Order dated 10.05.2007 passed by the Hon'ble Supreme Court in Soma Chakravarty vs. State through CBI, Crl. Appeal No. 710 of 2007.
46. Apart from the contention that the A1 Narayan Diwakar is entitled to be acquitted on the ground that sanction under Section 197 Cr. P.C. has not been taken qua him, it is further contended that A1 Narayan Diwakar is also entitled to get benefit of lack of sanction under Section 19 PC Act. It is contended that post amendment in the PC Act, legislature has made obtaining sanction mandatory even for retired public servants. Since the issue of sanction is procedural in CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 22 of 103 CBI No. 83/19 nature, it is contended that the said amendment would apply retrospectively. It has also been stated that the said issue is pending before the Hon'ble Delhi High Court in a Crl. Ref. 01/2019 titled Court of its own motion vs. State.
Additional submissions on behalf of A3 Raman Verma
47. Sh. Anil Kumar, Ld. Counsel for A3 Raman Verma submitted that PW 12 B. S. Kohli was an unreliable witness. He was arrayed as an accused in the FIR but not chargesheeted. He had criminal cases against him and was suspended from his job. The records of the society were under his control and he had carried the same to his residence after his suspension. Even otherwise, PW 12 B. S. Kohli is stated to have not deposed anything adverse or incriminating against A3 Raman Verma. There is also stated to be no evidence that A3 Raman Verma knew A4 Gokul Chand Aggarwal or PW 12 B. S. Kohli or that he could distinguish between the two. It was contended that in fact, A3 Raman Verma had been cheated by the alleged impersonation by A4 Gokul Chand Aggarwal.
48. There is stated to be no evidence whatsoever that A3 Raman Verma put up false notes. There is no evidence that A3 Raman Verma completely and manifestly disregarded the DCS Act and Rules. Further, PW 58 Rakesh Bhatnagar had forwarded the file to the RCS CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 23 of 103 CBI No. 83/19 only after his due satisfaction. Hence, the act of PW 58 Rakesh Bhatnagar, who was not found to have committed any wrong and was thus not arrayed as an accused, established that there was no illegality or irregularity in the processing of the file on the part of A3 Raman Verma.
49. Ld. Counsel pointed out that the only specific fact stated against A3 Raman Verma is with regard to the change of address of the society. It is submitted that the address which the CBI avers was concealed by A3 Raman Verma, was not approved by the office of RCS. Further, the address of Rohini was only the correspondence address. There is thus stated to be no irregularity committed by A3 Raman Verma.
Additional submissions on behalf of A4 Gokul Chand Aggarwal
50. Sh. Raghav Sabharwal, Ld. Amicus Curiae submitted on behalf of A4 Gokul Chand Aggarwal that there was no evidence of any connection between A4 Gokul Chand Aggarwal and the Society or its affairs or even between the Society and the Shop No. 25, CSC- 1, DDA Market, E-15-16, Sector-8, Rohini, Delhi. There is no witness who connects either A4 Gokul Chand Aggarwal or the shop with the Society. There is also stated to be no evidence of A4 Gokul Chand Aggarwal allegedly visiting the office of RCS on behalf of the CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 24 of 103 CBI No. 83/19 Society or of A4 Gokul Chand Aggarwal signing as B. S. Kohli. The prosecution has failed to bring on record any evidence that A4 Gokul Chand Aggarwal asked anyone to become a member of the Society.
51. The CDR placed on record is stated to have not been proved as per law nor is it of the relevant period. The handwriting opinion is also stated to be not enough to establish the guilt of A4 Gokul Chand Aggarwal. It is stated that it is settled position of law that it is not safe to convict a person on the sole testimony of a handwriting expert. Such opinion is stated to be not substantive evidence. Further no admitted writings of A4 Gokul Chand Aggarwal were taken and sent to GEQD for comparison. The specimen writings too were taken without the permission of the court and thus cannot be relied upon. Ld. Amicus Curiae has relied upon Order dated 23.09.2016 passed by the Hon'ble Supreme Court in S.P.S. Rathore vs. CBI & Anr., Crl. Appeal no. 2126 of 2010.
52. Ld. Amicus Curiae submitted that no incriminating material has been recovered from A4 Gokul Chand Aggarwal. It is submitted that investigation was unfair and biased. A4 Gokul Chand Aggarwal has been made a scapegoat while giving PW 12 B. S. Kohli an escape route by creating a false story of PW 12 B. S. Kohli handing over certain records to A4 Gokul Chand Aggarwal. There is stated to be CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 25 of 103 CBI No. 83/19 neither any receipt of such record being handed over nor any witness thereto.
Additional submissions on behalf of A5 P. K. Thirwani
53. Sh. S. K. Bhatnagar, Ld. Counsel on behalf of A5 P. K. Thirwani has submitted in addition to the common submissions that A5 P. K. Thirwani has been made a scapegoat. It is pointed out that there was no evidence against A5 P. K. Thirwani in the PE and therefore he was not named in the FIR. It is further submitted that no serious irregularities in the audit conducted by A5 P. K. Thirwani have been pointed out by the prosecution. Further, it is also not alleged that the list of members was approved on the basis of the audit report submitted by A5 P. K. Thirwani. In fact, it is emphasized that there is no provision that the list of members would be sent to DDA only after a society is audited.
54. Ld. Counsel further pointed out that the DCS Act does not specify that the audit has to be done at the registered office. Further that even if it is done at any other place with the permission of the RCS, the audit would not change. The audit is stated to be done on the basis of the accounts produced on behalf of the Society which is being audited. It is contended that such accounts can be produced by anyone. Further more, A5 P. K. Thirwani has raised vital objections CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 26 of 103 CBI No. 83/19 in the audit report, which have been concealed by the prosecution. The prosecution is stated to have focused only on the difference in the amount of the balance whereas A5 P. K. Thirwani has raised an objection with regard to reconciliation of accounts with the bank. Further, it is pointed out that the audit was done on 05.05.2003 till 31.03.2002. Satish Aggarwal, Treasurer and Gurucharan Dass Gupta, Vice President were not members during the period till 31.03.2002. However, they were office bearers on the date of the audit. In any case, it is submitted that the society is responsible for the correctness of its record.
55. It is pointed out that the audit has been done by A5 P. K. Thirwani in accordance with Section 53 DCS Act under orders i.e. on appointment by AR (Audit). It also pointed out that the audit was done prior to the request letter dated 13.06.2003 being sent. The audit report is stated to have been checked by the DA/Karnal Singh and no objections were raised to the audited report. It is thus contended that the audit was done properly without any violations of the DCS Act, Rules and Directives passed thereunder.
56. Ld. Counsel further referred to Section 89 DCS Act wherein it is specifically mentioned that the official liquidator is a public servant. It is thus contended that the auditor is not a public servant as it has not been so mentioned in the DCS Act/Rules. Further, it is CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 27 of 103 CBI No. 83/19 stated that the act of auditing done by A5 P. K. Thirwani is the same as that done by a certified auditor. Further more, it is a paid service. Ld. Counsel also referred to the definition of public servant in Section 2 (c)(i)PC Act. It is contended that service to a Co-operative Society with limited persons is not public duty. It is thus contended that A5 P. K. Thirwani was not a public servant and thus could not be prosecuted under the PC Act.
57. Ld. Counsel has also referred to Sections 28, 40 and 85 DCS Act. Section 28 DCS Act mandates that final authority in a Co- operative Society was vested in the general body of members. Section 40 DCS Act provides that any register or list of members maintained by any Co-operative Society shall be prima facie evidence of the membership of persons. Section 85 DCS Act requires that every Co-operative Society shall keep a copy of DCS Act, Rules, society's bye-laws and a list of its members open for inspection free of charge at its registered office. Ld. Counsel also referred to Rule 37 of DCS Rules which requires the list of members to be uploaded on the website of the office of the RCS. Ld. Counsel contended that the list of members could have been inspected by anyone but was not done.
58. Besides the averment that A5 P. K. Thirwani is not a public servant, Ld. Counsel further contended that Section 13 (1) (d) PC Act CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 28 of 103 CBI No. 83/19 is not applicable to A5 P. K. Thirwani as no demand, which is an essential requisite for applicability of the provision, was raised, even allegedly, by A5 P. K. Thirwani. There is stated to be no evidence whatsoever of any pecuniary gain by A5 P. K. Thirwani. No incriminating material is stated to have been recovered from the possession of A5 P. K. Thirwani. No evidence is stated to be there on record of misuse of office or any dishonest act in auditing on the part of A5 P. K. Thirwani. Further more, it is contended that A5 P. K. Thirwani had no role nor is any attributed to him in the approval of freeze list. A5 P. K. Thirwani had thus not even facilitated the alleged act of dishonest approval of the freeze list. It is pointed out that the presumption under Section 20 PC Act is not applicable to Section 13 (1) (d) PC Act.
59. Ld. Counsel further pointed out that the prosecution has referred to the CBSE CGHS as a 'defunct' society. It is submitted that no order as such was passed by the RCS. CBSE CGHS is thus stated to not been a defunct society.
60. Ld. Counsel has submitted that the CBI has not even recommended department enquiry against A5 P. K. Thirwani. It was also contended that even a case of attempt is not made out as land was not alloted to the Society. It was submitted that the despite having sent the freeze list, there was no possibility of the Society CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 29 of 103 CBI No. 83/19 being alloted land as its registered number as per seniority had not yet reached. Ld. Counsel further contended that PW 12 Sh. B. S. Kohli had been let off by the IO. It was contended that the said witness was liable under Section 406 IPC while the IO was liable to be tried for the offences under Section 217 to 219 IPC. Further more, the IO is stated to have not been authorized to investigate the case as he was a Sub-Inspector and had not been permitted under Section 17 PC Act.
61. Ld. Counsel contended that an accountant, advocate and an auditor cannot be conspirators. The Ld. Counsel relied upon Dinesh Chand Shukla vs. State (NCT of Delhi), 2007 IV AD (Delhi) 173 in support of his contention.
Contentions on behalf of CBI in Rebuttal
62. In response to the contentions regarding sanction to prosecute, the Ld. Special Senior PP referred Order dated 25.02.1972 passed by Hon'ble Bombay High Court in Crl. Rev. Application No. 841/1971 titled State of Maharashtra Vs. Govind Purshottam Shahane and Order dated 28.11.2005 passed by the Hon'ble Allahabad High Court in case titled Smt. Neera yadav vs. CBI (Bharat Singh). He submitted that the objections raised by the CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 30 of 103 CBI No. 83/19 accused persons A3 Raman Verma and A5 P. K. Thirwani were baseless.
Points for consideration
63. The broader point for consideration of course is whether the accused persons are guilty of the charges framed against them, that is whether they are proved to have committed the alleged offences beyond reasonable doubt? To arrive at a conclusion to this question, this court is required to determine the following issues:
1. Whether IPC is not applicable to the present case in view of DCS Act being a special Act?
2. Whether the present proceedings are hit by Section 93 DCS Act?
3. Whether the proceedings are hit by Section 95 DCS Act?
4. Whether sanction under Section 197 Cr. P.C was essential in respect of A1 Narayan Diwakar, A3 Raman Verma and A5 P. K. Thirwani?
5. Whether sanction under Section 19 PC Act granted in respect of A3 Raman Verma and A5 P. K. Thirwani is invalid?
6. Whether the amended Section 19 PC Act has retrospective effect such that sanction under said provision would have been required to take cognizance of the offences qua A1 Narayan Diwakar?
7. Whether any of the officials in the office of RCS had any role in determining the list of members of the society?
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 31 of 103 CBI No. 83/19
8. Whether the accused public servants violated any of the provisions of DCS Act, Rules or any Directive passed under while dealing with the file of CBSE CGHS?
9. Whether the accused persons have committed the offences they are charged with?
10. Result.
Observations of the Court
64. Before launching into the discussion of the facts, allegations and the evidence, it would be appropriate to advert to a major change in the policy relating to allotment of land to Co-operative Group Housing Societies by DDA. As deposed by the Dy. Director (GH), DDA Sh. Krishan Gopal Kashyap/PW 44, land was alloted to Co- operative Group Housing Socities on first come first serve basis. After the judgment given in Kaveri CGHS vs. Union of India, Crl. WP no. 2885/19, land was alloted in terms of the directions of the Hon'ble High Court of Delhi on the basis of seniority of the registration of the society with the office of RCS.
65. As further deposed by PW 44, DDA plays no role in choosing the Co-operative Group Housing Society to whom land is to be alloted, except on the basis of seniority, post the decision in Kaveri's case. He further stated that "DDA allots land to the societies CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 32 of 103 CBI No. 83/19 on the recommendation of RCS and on receipt of final list of members in accordance with their seniority... The genuineness of the members of the list so forwarded is required to be ascertained by the RCS office and DDA has no responsibility for the same."
Point no. 1: Whether IPC is not applicable to the present case in view of DCS Act being a special Act?
66. The Ld. Counsel for A5 P. K. Thirwani has contended that the DCS Act is a special Act. Thus, its provisions override those of the IPC, which is a general Act. Sh. Bhatnagar, Ld. Counsel for A5 P. K. Thirwani also referred to Section 5 of IPC. Section 5 IPC provides as under:
5. Certain laws not to be affected by this Act.-Nothing in this Act shall affect the provisions of any Act for punishing mutiny and desertion of officers, soldiers, sailors or airmen in the service of the Government of India or the provisions of any special or local law.
As the title states, Section 5 provides that certain laws shall not be affected by the provisions of IPC. The provision enumerates the types of laws that won't be affected by IPC as:
1. provisions of any Act for punishing
- mutiny
- desertion of officers, soldiers, sailors or airmen in the service of the Government of India
2. provisions of any special or local law.
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 33 of 103 CBI No. 83/19 Hence, Section 5 IPC saves the effect of any special Act. The same cannot be denied.
67. Similarly, the principle that a special act overrides a general act cannot be denied. However, before the said principle is put into action, one needs to examine the said two acts. The DCS Act lays down the law to govern the formation, registration, management and running of co-operative societies formed in Delhi. IPC, on the other hand is a penal law. It is the general act defining offences and prescribing its sentence. Ergo, the sphere of operation of both the penal laws and the DCS Act are totally distinct.
68. Sh. Bhatnagar, Ld. Counsel for A5 P. K. Thirwani also contended that the DCS Act laid down certain offences and also provides for a bar to taking cognizance of any offence without the previous sanction of the Registrar, in Section 83 thereof. The said provision is reproduced below for ready reference:
83. Cognizance of offence (1) No court inferior to that of Magistrar of the first class shall try and offence under this Act.
(2) No prosecution shall be instituted under this Act without the previous sanction of the Registrar and such sanction shall not be given without giving to the person concerned a reasonable opportunity to represent his case.
(emphasis supplied) CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 34 of 103 CBI No. 83/19
69. The contention of the Ld. Counsel qua Section 83 is thus correct. However, the bar to taking cognizance applies only to the offences provided under this Act, and not to any other offence. The DCS Act lays down the offences in Section 82 which are as follows:
82. Offence (1) Any person other than a co-operative society carrying on business under any name or title of which the word 'co-operative' or its equivalent in any Indian language is part, without the sanction of the Lieutenant-Governor shall be punishable with fine which may extent to two hundred rupees and in the case of a continuing breach with a further fine which may extend to give hundred rupees for every day during which the breach is continued after conviction for the first such breach.
(2) Any member or past member or the nominee, heir or legal representative of a deceased member of a co- operative society who contravenes the provisions of sections 36 and 37 by disposing of any property in respect of which the society is entitled to have a first charge under that section or do any other act to the prejudice of such claim, shall be punishable with fine which may extend to give hundred rupees.
(3) A co-operative society or an office or member thereof willfully making a false return or furnishing false information, or any person willfully or without any reasonable excuse disobeying any summons, requisition or lawful written order issued under the provisions of this Act or willfully not furnishing any information required from him by a person authorized in this behalf under the provisions of this Act, shall be punishable with fine which may extend to two hundred rupees.
(4) Any employer who, without sufficient cause, fails to pay to a co-operative society the amount deducted by him under Section 44 within a period of fourteen days from the date on which such deduction is made shall, without prejudice to any action that may be taken against him under any law for the time being in force be punishable with fine which may extend to give hundred rupees.
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 35 of 103 CBI No. 83/19 (5) Any officer or custodian who willfully fails to hand over custody of books records, cash security and other property belonging to a co-operative society of which he is an officer or custodian, to a person entitled under section 33, 53, 54, 55 or 66 shall be punishable with fine which may extend to two hundred rupees and in the case of a continuing breach with a further fine which may extend to give hundred rupees for every day during which the breach is continued after conviction for the first such breach.
(6) Any person who fraudulently acquired or abets in the acquisition of any such property which is subject to a charge under section 36 and 37 shall be punishable with five which may extend to two hundred rupees.
Two aspects need to be noted in respect of Section 82 DCS Act. Firstly, a simple reading of Section 82 makes it clear that the offences provided in the DCS Act pertain to an act by a co-operative society/its member or an act against such co-operative society/its member. The provision does not define any act of the Registrar or any other official of RCS as an offence. The section also does not provide for an act of corruption or criminal conspiracy. The DCS Act thus lays down as offences very few acts of special nature qua the functioning of the co-operative societies.
70. Secondly, Section 82 of the DCS Act or any other provision of the said Act contains no statutory embargo for a court to take cognizance of an offence under the provisions of IPC. The Hon'ble Supreme Court in K. Ashoka vs. N. L. Chandrashekhar and Ors., 2009 5 SCC 199 has made observations in respect of Section 109 of CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 36 of 103 CBI No. 83/19 the Karnataka Cooperative Societies Act, 1959 which contains offences under the Act. Said observations are reproduced below:
Section 109 of the Act provides for commission of offences under the said Act. Therein, no statutory embargo has been placed for a court to take cognizance of an offence under the provisions of IPC. If the allegations made in the complaint petition or in the first information report make out a case under the IPC, Section 111 of the Act, to which our attention has been drawn, would constitute no bar for maintenance thereof being applicable only in respect of offences committed under the said Act. The said statutory interdict therefore cannot be extended in regard to commission of an offence under any other Act.
71. In view of the above observations and the fact that the provisions of the DCS Act and IPC apply to distinct fields, the IPC does not require to give way to the provisions of the DCS Act. Section 5 IPC is hence not applicable to the present case. Point 1 is thus answered in the negative. Operation of the provisions of IPC is not inapplicable to the present case.
Point no. 2: Whether the present proceeding is hit by Section 93 DCS Act?
72. Sh. Abhishek Prasad, Ld. Amicus Curiae for A1 Narayan Diwakar and Sh. Anil Kumar, Ld. Counsel for A3 Raman Verma contended that Section 93 of the DCS Act laid down a bar of 'jurisdiction of courts'. The present proceedings are stated to be hit by the said bar. The present proceedings being illegal, the accused CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 37 of 103 CBI No. 83/19 persons had been wrongly tried by this court. Hence, all the accused persons are stated to be entitled to be acquitted.
73. Consideration of the contention requires a look at the provision referred to. It is as follows:
93. Bar of jurisdiction of courts (1) Save as provided in this Act, no civil or revenue court shall have any jurisdiction in respect of -
(a) the registration of a co-operative society or its bye-laws or of an amendment of a bye-law;
(b) the removal of a committee;
(c) any dispute required under section 60 to be referred to Registrar; and
(d) any matter concerning the winding up and the dissolution of a co-operative society.
(2) While a co-operative society is being wound up, no suit or other legal proceedings relating to the business of such society shall be proceeded with or instituted against, the liquidator as such or against the society or any member thereof, except by leave of the Registrar and subject to such terms as he may impose.
(3) Save as provided in this Act, no order, decision or award made under this Act shall be questioned in any court on any ground whatsoever.
74. The 'bar of jurisdiction of courts' is provided for the specific acts mentioned in the provision. The 'bar' is not for every act as is sought to be contended. There is thus no bar of jurisdiction of courts to try the offences with which the accused persons have been charged with in this case. Point 2 has to be answered in the negative.
Point no. 3: Whether the proceedings are hit by Section 95 DCS Act?
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 38 of 103 CBI No. 83/19
75. Sh. Abhishek Prasad, Ld. Amicus Curiae for A1 Narayan Diwakar, Sh. Anil Kumar, Ld. Counsel for A3 Raman Verma and Sh. S. K. Bhatnagar, Ld. Counsel for A5 P. K. Thirwani have submitted that the RCS and its officers cannot be proceeded against in any suit, prosecution or other legal proceedings as they are protected from such proceedings.
Section 95 DCS Act reads as follows:
95. Indemnity- No suit, prosecution or other legal proceedings shall lie against the Registrar or any person subordinate to him or acting on his authority in respect of anything in good faith done or purporting to have been done under this Act.
76. The contention that the RCS and the persons subordinate to him are not liable to face any suit, prosecution or other legal proceedings in respect of anything done in good faith or purporting to have been done under this Act, is not denied. Yet, the question remains whether the acts of the officers of the office of RCS have been done in good faith or not. Also, if such acts constitute commission of an offence under another statute, the DCS Act cannot be a bar against their prosecution for commission of such offence as the act constituting commission of such offence cannot be said to have been done in good faith nor purported to have been done under the DCS Act. Point no. 3 is thus answered in negative.
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 39 of 103 CBI No. 83/19 Point no. 4: Whether sanction under Section 197 Cr. P.C. was essential in respect of A1 Narayan Diwakar, A3 Raman Verma and A5 P. K. Thirwani?
77. The Ld. Counsel for the accused public servants have contended that sanction under Section 197 Cr. P.C. in respect of the offences under IPC was essentially required to be taken. In the absence of such sanction being taken, all the said three accused public servants are stated to be entitled to be acquitted. It is submitted that the acts done by the three accused public servants which are alleged to have been done in pursuance of a criminal conspiracy with A4 Gokul Chand Aggarwal were acts done in their respective official capacities.
78. Sh. Abhishek Prasad, Ld. Amicus Curiae for A1 Narayan Diwakar has submitted that the said accused dealt with the file of CBSE CGHS in the capacity of his being the RCS. He dealt with the file in discharge of his official functions. Had he not been posted as the Registrar, he would not have dealt with the file and hence not passed the orders which are alleged to have been passed in pursuance of the conspiracy. The alleged act of passing the order is stated to have direct nexus with the discharge of his official functions and therefore sanction under Section 197 Cr. P.C. was mandatory. The Ld. Amicus Curiae has relied upon Order dated 26.04.2016 passed by Hon'ble Supreme Court in Crl. Appeal No. 396/2016 titled Amal CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 40 of 103 CBI No. 83/19 Kumar Jha Vs. State of Chhatisgarh & Anr.; Order dated 05.07.2016 passed by Hon'ble Supreme Court in Crl. Appeal No. 565/2016 titled Surinderjit Singh Mand & Anr. Vs. State of Punjab & Anr.; Order dated 24.07.2001 passed by Hon'ble Supreme Court in Crl. Appeal No. 1118/2000 titled P. K. Pradhan Vs. State of Sikkim; Ashok Mehta & Anr. Vs. Ram Ashray Singh & Ors., (2006) 1 SCC (Crl.) 530; Order dated 24.04.2008 passed by Hon'ble Supreme Court in Crl. Appeal No. 413/2000 titled Anjani Kumar Vs. State of Bihar & Anr.; Shreekantiah Ramayya Munipalli Vs. State of Bombay, (1955) 1 SCR 1177 and Order dated 19.11.2015 passed by Hon'ble Supreme Court in Crl. Appeal No. 798/2015 titled Prof. N. K. Ganguly Vs. CBI in support of his contentions.
79. Sh. Anil Kumar, Ld. Counsel for A3 Raman Verma also submitted that since Raman Verma has been charged with the penal offences under IPC, the mandatory requirement of procuring sanction for prosecution under Section 197 Cr. P.C. was required to be satisfied. It is also stated that such sanction is required in addition to the sanction for prosecution taken under Section 19 PC Act. He too contended that the alleged offences were committed during the course of discharge of official duties and thus sanction under Section 197 Cr. P.C. was required. Ld. Counsel relies upon Order dated 19.11.2015 passed by Hon'ble Supreme Court in Crl. Appeal No. CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 41 of 103 CBI No. 83/19 798/2015 titled Prof. N. K. Ganguly Vs. CBI New Delhi in support of his contentions.
80. Sh. S. K. Bhatnagar, Ld. Counsel for A5 P. K. Thirwani has argued on the same lines. He has further submitted that the CBI manual also requires taking of such sanction.
81. All the Ld. Counsel further pointed out that though sanction is required for the purposes of taking cognizance, it is well settled that the question of sanction can be raised any time, even after cognizance is taken. It can be raised at the time of conclusion of trial and after conviction as well.
82. The Ld. Special Senior PP has submitted that it is not every offence committed by the public servants which requires sanction for prosecution under Section 197 Cr. P.C. Not even every act done by him while he is actually engaged in the performance of his official duties requires sanction for prosecution. It was submitted that only if the act complained of is directly concerned with the official duties of the accused public servant in such a manner that, if questioned, it could be claimed to have been done by virtue of the office, then sanction would be necessary. It was submitted that sanction under Section 197 Cr. P.C. does not extend its protective cover to every act or omission done by the public servant but restricts its scope of CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 42 of 103 CBI No. 83/19 operation to only those acts and omissions which are done by the public servant in discharge of his official duty. Where the official duty of the public servant is merely a cloak for doing the objectionable act, the protection under Section 197 Cr. P.C. is not available. Ld. Special Senior PP has relied upon Raghunath Anant Goviker Vs. State of Maharashtra, MANU/SC/0753/2008; State of M.P. Vs. Sheetla Sahai and Ors., MANU/SC/1425/2009 and Choudhary Parveen Sultana Vs. State of West Bengal & Ors., MANU/SC/0011/2009 in support of his arguments. Further, he relied strongly upon Harihar Prasad & Ors. Vs. State of Bihar, MANU/SC/0114/1971 wherein the Hon'ble Supreme Court has held "To put it shortly, it is not part of the duty of 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 Cr. P.C. is, therefore, no bar." Ld. Special Senior PP therefore contended that no sanction under Section 197 Cr. P.C. was required in the present case.
83. Ld. Special Senior PP further referred to Order dated 28.11.2005 passed by the Hon'ble Allahabad High Court in case titled Smt. Neera yadav vs. CBI (Bharat Singh) to contend that sanction to prosecute under Section 197 Cr. P.C was not required.
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 43 of 103 CBI No. 83/19
84. Cognizance of any offence by any court is barred by Section 197 Cr. P.C. unless sanction is obtained from the appropriate authority, if the offence alleged to have been committed by a public servant was so committed in discharge of the official duty of such public servant. The section not only specifies the persons to whom the protection is afforded but it also specifies the conditions and circumstances in which it shall be available and the effect in law if the conditions specified are present in the case under consideration.
85. It would be appropriate to reproduce the provision here. The relevant portion of Section 197 Cr. P.C. is as follows:
197. Prosecution of Judges and public servants.
(1) When any person who is or was a Judge or Magistrate or 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 or purporting to act in the discharge of his official duty, no Court shall take cognizance of such offence except with the previous sanction (save as otherwise provided in the Lokpal and Lokayuktas Act, 2013)-
(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;
(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:
Provided that where the alleged offence was committed by a person referred to in clause (b) during the period while a Proclamation issued under clause (1) of article 356 of the Constitution was in force in a State, clause (b) will apply as if for the expression "State Government" occurring therein, the expression "Central Government" were substituted.
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 44 of 103 CBI No. 83/19
86. The Section falls in the chapter dealing with the conditions requisite for initiation of proceedings. That is if the conditions mentioned are not made out or are absent, then no prosecution can be set in motion. Section 197 (1) Cr. P.C. 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 or purporting to act in discharge of his official duty, no court shall take cognizance of such offence except with the previous sanction of the appropriate authority, as specified therein.
87. A reading of the provision shows that it applies in the following circumstances:
1. A person is or was a judge or magistrate or a public servant.
2. Such person was not removable from his office save by or with the sanction of the government.
3. Such person is accused of committing an offence while acting or purporting to act in the discharge of his official duty.
If all the circumstances are applicable to the case being considered, the court is barred from taking cognizance of such offence committed by such public servant except with the previous sanction of the competent authority.
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 45 of 103 CBI No. 83/19
88. The mandatory character of the protection afforded to a public servant is brought out by the expression 'no court shall take cognizance of such offence except with the previous sanction'. Use of words 'no' and 'shall' make it abundantly clear that the bar on the exercise of power of the court to take cognizance of any offence is absolute and complete and the very cognizance is barred.
89. Though Section 197 Cr. P.C. applies at the stage of taking cognizance, it is well settled that question of sanction under Section 197 Cr. P.C. can be raised any time - at the stage of taking cognizance or even thereafter - even at the time of conclusion of trial or after conviction as well. This aspect of sanction under Section 197 Cr. P.C has not been challenged by the prosecution also.
90. Section 197 Cr. P.C. affords a protection to public servants in view of the nature of their service. In Sheetla Sahai's case (supra), the Hon'ble Supreme Court cited Centre for Public Interest Litigation and Anr. Vs. Union of India and Anr., MANU/SC/2091/2005 wherein the Hon'ble Supreme Court had observed as follows:
The protection given under Section 197 is to protect responsible public servants against the institution of possibly vexatious criminal proceedings for offences alleged to have been committed by them while they are acting or purporting to act as public servants. The policy of the legislature is to afford adequate protection to public servants to ensure that they are not prosecuted for anything done by them in the discharge of their official duties without reasonable cause, and if sanction is granted, to confer on the Government, if they choose to exercise it, complete control of the prosecution. This CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 46 of 103 CBI No. 83/19 protection has certain limits and is available only when the alleged act done by the public servant is reasonably connected with the discharge of his official duty and is not merely a cloak for doing the objectionable act. If in doing his official duty, he acted in excess of his duty, but there is a reasonable connection between the act and the performance of the official duty, the excess will not be a sufficient ground to deprive the public servant from the protection.
91. In the present case, A3 Raman Verma and A5 P. K. Thirwani were public servants at the time the charge-sheet was filed while A1 Narayan Diwakar had retired from public service. Since Section 197 Cr. P.C. applies to public servants while they are in such office as well as to public servants who were in such office but had ceased to be so, it would apply to all the three accused public servants if previous sanction under Section 197 Cr. P.C. was required to be taken in the present case.
92. The contention of the prosecution is that no such sanction was required to be taken as the alleged acts were not a part of the official duty of the public servant. It is thus required to be examined whether the acts alleged to have been committed by the three accused public servants would be considered to have been committed 'while acting or purporting to act in the discharge of their official duty' or not in the facts and circumstances of this case.
93. As observed by Hon'ble Supreme Court in State of Maharashtra Vs. Dr. Budhikota Sobbarao, 1993 (3) SCC, as follows:
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 47 of 103 CBI No. 83/19 Such being the nature of the provision the question is how should the expression, 'any offence alleged to have been committed by him while acting or purporting to act in the discharge of his official duty', be understood? What does it mean? 'Official' according to dictionary, means pertaining to an office. And official act or official duty means an act or duty done by an officer in his official capacity.
The Hon'ble Apex Court further observed that:
Use of the expression, 'official duty' implies that the act or omission must have been done by the public servant in course of his service and that it should have been in discharge of his duty. The section does not extend its protective cover to every act or omission done by a public servant in service but restricts its scope of operation to only those acts or omissions which are done by a public servant in discharge of official duty.
94. In B. Saha vs. M.S. Kochar, (1979) 4 SCC 177, the Hon'ble Supreme Court has also observed as follows:
The words 'any offence alleged to have been committed by him while acting or purporting to act in the discharge of his official duty' employed in Section 197(1) of the Code, are capable of a narrow as well as a wide interpretation. If these words are construed too narrowly, the section will be rendered altogether sterile, for, 'it is no part of an official duty to commit an offence, and never can be'. In the wider sense, these words will take under their umbrella every act constituting an offence, committed in the course of the same transaction in which the official duty is performed or purports to be performed. The right approach to the import of these words lies between these two extremes. While on the one hand, it is not every offence committed by a public servant while engaged in the performance of his official duty, which is entitled to the protection of Section 197(1), an act constituting an offence, directly and reasonably connected with his official duty will require sanction for prosecution under the said provision. As pointed out by Ramaswami, J. in Baijnath v. State of M.P. AIR 1966 SC 220 : (AIR p. 227, para
16) '16. ... It is the quality of the act that is important, and if it falls within the scope and range of his official duties the protection CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 48 of 103 CBI No. 83/19 contemplated by Section 197 of the Criminal Procedure Code will be attracted'.
(emphasis supplied)
95. In Centre for Public Interest Litigation's case (supra), the Hon'ble Supreme Court had further observed as follows:
The question is not as to the nature of the offence such as whether the alleged offence contained an element necessarily dependent upon the offender being a public servant, but whether it was committed by a public servant acting or purporting to act as such in the discharge of his official capacity. Before Section 197 can be invoked, it must be shown that the official concerned was accused of an offence alleged to have been committed by him while acting or purporting to act in the discharge of his official duties. It is not the duty which requires examination so much as the act, because the official act can be performed both in the discharge of the official duty as well as in dereliction of it. The act must fall within the scope and range of the official duties of the public servant concerned. It is the quality of the act which is important and the protection of this section is available if the act falls within the scope and range of his official duty. There cannot be any universal rule to determine whether there is a reasonable connection between the act done and the official duty, nor is it possible to lay down any such rule. One safe and sure test in this regard would be to consider if the omission or neglect on the part of the public servant to commit the act complained of could have made him answerable for a charge of dereliction of his official duty. If the answer to this question is in the affirmative, it may be said that such act was committed by the public servant while acting in the discharge of his official duty and there was every connection with the act complained of and the official duty of the public servant. This aspect makes it clear that the concept of Section 197 does not get immediately attracted on institution of the complaint case.
(emphasis supplied) CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 49 of 103 CBI No. 83/19
96. The Hon'ble Supreme Court has observed in Shreekantiah Ramayya Munipalli vs. The State of Bombay, 1955 (1) SCR 1177 thus:
Now it is obvious that if section 197 of the Code of Criminal Procedure is construed too narrowly it can never be applied, for of course it is no part of an 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 performed in the discharge of official duty as well as in dereliction of it. The section has content and its language must be given meaning. What it says is -
"when any public servant ..... is accused of any offence alleged to have been committed by him while acting or purporting to act in the discharge of his official duty......" We have therefore first to concentrate on the word 'offence'. ... Therefore, the act complained of, namely the disposal, could not have been done in any other way. If it was innocent, it was an official act; if dishonest, it was the dishonest doing of an official act, but in either event the act was official. Therefore, whatever the intention or motive behind the act may have been, the physical part of it remained unaltered, so if it was official in the one case it was equally official in the other, and the only difference would lie in the intention with which it was done: in the one event, it would be done in the discharge of an official duty and in the other, in the purported discharge of it. We therefore hold that section 197 of the Code of Criminal Procedure applies and that sanction was necessary.
(emphasis supplied)
97. The answer to the contention of the Ld. Special Senior PP has been succinctly stated by the Hon'ble Apex Court in Surenderjit Singh Mand's case citing R. Balakrishna Pillai vs. State of Kerala, (1996) 1 SCC 478 wherein it was observed:
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 50 of 103 CBI No. 83/19 The next question is whether the offence alleged against the appellant can be said to have been committed by him while acting or purporting to act in the discharge of his official duty. It was contended by the learned counsel for the State that the charge of conspiracy would not attract Section 197 of the Code for the simple reason that it is no part of the duty of a Minister while discharging his official duties to enter into a criminal conspiracy. In support of his contention, he placed strong reliance on the decision of this Court in Harihar Prasad vs. State of Bihar, (1972) 3 SCC 89. The question whether the acts complained of had a direct nexus or relation with the discharge of official duties by the public servant concerned would depend on the facts of each case. There can be no general proposition that whenever there is a charge of criminal conspiracy levelled against a public servant in or out of office the bar of Section 197(1) of the Code would have no application. Such a view would render Section 197(1) of the Code specious. Therefore, the question would have to be examined in the facts of each case. The observations were made by the Court in the special facts of that case which clearly indicated that the criminal conspiracy entered into by the three delinquent public servants had no relation whatsoever with their official duties and, therefore, the bar of Section 197(1) was not attracted.
(emphasis supplied) As observed by the Hon'ble Supreme Court in B. Saha's case (supra):
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.
98. In the light of the above quoted observations of the Hon'ble Apex Court, one needs to examine the alleged act of the three accused public servants. A1 Narayan Diwakar is alleged to have approved the freeze strength of CBSE CGHS in conspiracy with the others. As the RCS, A1 Narayan Diwakar had approved the proposal CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 51 of 103 CBI No. 83/19 recommended by his subordinates. This was the only time he dealt with the file of CBSE CGHS in respect of the request for approval of freeze strength. The decision whether the freeze strength of any society is to be approved or disapproved is required to be taken by the RCS. It was one of the several duties to be discharged by the person occupying the post of RCS. A1 Narayan Diwakar had thus discharged such official duty by taking the decision of approving the freeze strength of CBSE CGHS. Whether such decision was taken bonafidely or dishonestly in pursuance of a conspiracy would not change the nature of the act to be not in discarge of an official duty.
99. A3 Raman Verma was posted as DA in the office of RCS. It was his duty to put up notes with regard of any communcation/request received from any society. The notes so put up were required to seek orders from the RCS with respect to the request/communication received from the society. The various notes he thus put up in respect of the request letter dated 13.06.2003 seeking approval of the freeze strength of CBSE CGHS and forwaring the final list of DDA for allotment of land were put up in discharge of such official duty.
100. A5 P. K. Thirwani had audited the accounts of CBSE CGHS. He had been appointed the Auditor in normal course of his official duties. He conducted the audit in pursuance of such discharge of CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 52 of 103 CBI No. 83/19 official duty. The question whether A5 P. K. Thirwani audited the accounts honestly or dishonestly would not affect the nature of the act of auditing. The said act would remain an act done by A5 P. K. Thirwani in discharge of his official duty or at most, it would be an act done in the purported discharge of his official duty.
101. The act of all the three public servants being in discharge of their official duties or in the purported discharge of it, all the three public servants were entitled to the protection afforded by Section 197 Cr.P.C. An opportunity was required to be given to the competent authority to decide whether these public servants were to be prosecuted or not. The competent authority was required to see whether the said public servants were entitled to protection against prosecution or the prosecution should go ahead after granting such sanction.
102. In respect of A3 Raman Verma and A5 P. K. Thirwani, the question of protection or sanction being accorded was considered at the time of grant of sanction under Section 19 PC Act. It is worth noting that the competent authority under both Section 197 Cr. P. C. And Section 19 PC Act is the same. The competent authorities considered the fact that both A3 Raman Verma and A5 P. K. Thirwani had been accused of offences under the PC Act as well as under IPC. In fact, the sanction orders qua both these two accused note all the CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 53 of 103 CBI No. 83/19 provisions under which they are sought to be prosecuted. The sanction orders thereafter state that the sanction is accorded for prosecution for the said offences and any other offences punishable under any other provisions of law in respect of the acts of the accused mentioned therein.
103. It would be argued that such sanction has been granted under Section 19 PC Act. Indeed, it is so noted in the sanction order. The important aspect is that the competent authority was able to decide whether the public servant was to be protected from proseuction in the facts and circumstances of the case. Such opportunity was given in the case of both A3 Raman Verma and A5 P. K. Thirwani.
104. Reliance is placed in this respect in Order dated 28.11.2005 passed by the Hon'ble Allahabad High Court in case titled Smt. Neera yadav vs. CBI (Bharat Singh). The Hon'ble Allahabad High Court has held therein as under:
In view of the foregoing discussion it is held that in the present case prosecution for the offence under Section 13(1)(d) read with Section 13(2) of the Prevention of Corruption Act/120B of the Indian Penal Code is not vitiated for want of any sanction under Section 197 of Cr. P.C. After the sanction granted under Section 19 of the Prevention of Corruption Act the accused can be prosecuted by the Special Judge under the Prevention of Corruption Act. The Special judge has not committed any error in rejecting the application for quashing the proseuction for want of sanction under Section 197 of the Criminal Procedure Code. There is no error in exercising the jurisdiction by the Special Judge to try case. The prosecution of the applicant on the strength of the charge sheet dated 22.11.2002 cannot be said to be an CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 54 of 103 CBI No. 83/19 abuse of process of the court. No case is made out for exercise of inherent jurisdiction of this Court under Section 482 of Cr. P.C.
105. It may be noted here that neither accused has furnished any decision contrary to the above view. The citations referred by them on the point of sanction are mostly on Section 197 Cr. P.C only. In some of these decisions cited, sanction under Section 197 Cr. P.C. was held to be not required in the facts of the specific case while in others sanction had not been granted under either Section 197 Cr. P.C nor under Section 19 PC Act.
106. The question of protection versus sanction was thus considered in respect of both A3 Raman Verma and A5 P. K. Thirwani. The said opportunity was, however, not granted in respect of A1 Narayan Diwakar since no sanction was sought in his respect, either under Section 19 PC Act or under Section 197 Cr. P.C, even though he was entitled for consideration of grant of sanction for prosecution under Section 197 Cr. P.C at least. Point no. 4 has thus to be answered in the negative in respect of A3 Raman Verma and A5 P. K. Thirwani while it is answered in the affirmative in respect of A1 Narayan Diwakar.
Point no. 5: Whether sanction under Section 19 PC Act granted in respect of A3 Raman Verma and A5 P. K. Thirwani is invalid?
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 55 of 103 CBI No. 83/19
107. Two-fold arguments have been forwarded on behalf of the accused public servants in respect of the sanction for prosecution under Section 19 of PC Act.
108. The submission forwarded on behalf of two of the accused public servants i.e. A3 Raman Verma and A5 P. K. Thirwani is that the sanction for prosecution taken under Section 19 PC Act in their respect is not a valid sanction. The sanction is stated to have not been taken from the competent authority. Reliance is placed in this regard on Prakash Singh Badal Vs. State of Punjab & Ors., AIR 2007 SC 1274 by Sh. S. K. Bhatnagar, Ld. Counsel. For A5 P. K. Thirwani. Sh. Anil Kumar, Ld. Counsel for A3 Raman Verma has further contended that the sanction has been given without application of mind and thus too, the sanction under Section 19 PC Act for prosecuting A3 Raman Verma is invalid. Ld. Counsel relies on Ashok Kumar's case (supra) in this regard.
109. Ld. Special Senior PP submitted that the contention made is flawed. The sanction has been accorded by the authority who was competent to remove them at the time the sanction was taken. It is contended that law lays down that the authority having the capacity to remove the accused is the competent authority. Further, it is claimed that non-application of mind has not been established on the part of the sanctioning authority in respect of A3 Raman Verma. Ld. CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 56 of 103 CBI No. 83/19 Special Senior PP has further relied upon Order dated 25.02.1972 passed by Hon'ble Bombay High Court in Crl. Rev. Application No. 841/1971 titled State of Maharashtra Vs. Govind Purshottam Shahane to contend that a sanction granted by an officer superior in post to the competent authority and having supervisory position would be a proper sanction. Thus, both sanctions i.e. one for prosecuting A3 Raman Verma and the other for prosecuting A5 P. K. Thirwani are stated to be valid sanctions.
110. Before adverting to the facts of the present case, it would be appropriate to note the provision. Relevant portion of Section 19 PC Act is as follows:
19. Previous sanction necessary for prosecution.--(1) No court shall take cognizance of an offence punishable under sections 7, 10, 11, 13 and 15 alleged to have been committed by a public servant, except with the previous sanction1[save as otherwise provided in the Lokpal and Lokayuktas Act, 2013 (1 of 2014)]--
(a) in the case of a person who is employed in connection with the affairs of the Union and is not removable from his office save by or with the sanction of the Central Government, of that Government;
(b) in the case of a person who is employed in connection with the affairs of a State and is not removable from his office save by or with the sanction of the State Government, of that Government;
(c) in the case of any other person, of the authority competent to remove him from his office.
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 57 of 103 CBI No. 83/19 It is clear from a plain reading of the provision that the court cannot take cognizance of offences punishable under Section 7, 10, 11, 13 and 15 of the PC Act without sanction from the appropriate authority. The provision creates a complete bar on the power of the court to take cognizance of the said offences alleged to have been committed by public servant except with the previous sanction of the competent authority. By way of the said provision the Legislature has provided a reasonable protection to the public servants in discharging their official functions so that they may perform their duties and obligations undeterred by vexatious and unnecessary proseuctions.
110A. The Hon'ble Apex Court observed in Subramaniam Swamy Vs. Manmohan Singh, (2012) 3 SCC 64 as under:
74. Keeping those principles in mind, as we must, if we look at Section 19 of the P.C. Act which bars a Court from taking cognizance of cases of corruption against a public servant under Sections 7, 10, 11, 13 and 15 of the Act, unless the Central or the State Government, as the case may be, has accorded sanction, virtually imposes fetters on private citizens and also on prosecutors from approaching Court against corrupt public servants. These protections are not available to other citizens. Public servants are treated as a special class of persons enjoying the said protection so that they can perform their duties without fear and favour and without threats of malicious prosecution.
(emphasis supplied) The language employed in Sub-section (1) of Section 19 admits of no equivocation and operates as a complete and absolute bar to any CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 58 of 103 CBI No. 83/19 court taking cognizance of any offence punishable under Section 7, 10,11, 13 and 15 of the Act against a public servant except with the previous sanction of the competent authority. The court cannot be competent to hear and dertermine a prosecution the institution of which is prohibited by law in the absence of a proper sanction.
111. Though neither party has specifically argued on the issue of the stage when an objection regarding valid/invalid sanction can be raised, it is necessary to address the issue in brief. It is well settled that the sanction can be challenged at any stage. Although the same should ideally be raised at the earliest, evidence may at times be required to establish the validity/invalidity of the sanction. The question of the validity of the sanction may thus have considered at the stage of final arguments, after trial.
112. In the instant case, the sanctioning authorities of both A5 P. K. Thirwani and A3 Raman Verma have deposed as witnesses. Sh. R. Narayanaswami had granted sanction to prosecute A5 P. K. Thirwani while Sh. A. Majumdar had granted sanction to prosecute A3 Raman Verma.
113. Sh. R. Narayanaswami was posted as the Chief Secretary at the relevant time. As PW 56, he has stated that:
On receipt of the CBI report, I perused the report and the appended calender of evidence both documentary as well as oral to form a view CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 59 of 103 CBI No. 83/19 to sanction prosecution of the accused under the relevant provisions of Prevention of Corruption Act. After considering all the facts, I accorded the sanction to prosecute Prahalad Kumar Thirwani. This sanction was given pertaining to CBSE CGHS.
He proved the sanction order, Ex. PW 56/A by identifying his signature and seal. He also stated that he was the competent authority to remove A5 P. K. Thirwani from service.
114. It is noteworthy that PW 56 has not been cross-examined at all. Thus, A5 P. K. Thirwani has not brought on record any evidence whatsoever to show that sanction granted is not valid.
115. Sh. S. K. Bhatnagar, Ld. Counsel for A5 P. K. Thirwani has averred that sanction has been granted by PW 56 on the basis of the post occupied by A5 P. K. Thirwani at the time sanction to prosecute was sought. Whereas, in terms of the decision rendered in Prakash Singh Badal's case (supra), sanction ought to be sought (and granted) from the authority who would have been competent to remove the accused public servant from the post which such accused public servant is alleged to have abused. Ergo, it is contended that the person competent to grant sanction to prosecute A5 P. K. Thirwani in the present case would have been the officer who was competent to remove A5 P. K. Thirwani from his post of Head Clerk-cum-Auditor in the office of RCS.
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 60 of 103 CBI No. 83/19
116. A notice had been issued to the RCS to furnish details of appointing and removing authorities of the various posts in the office of RCS. The information was sought for 2003-04 that is the time of commission of the alleged offences and also for September, 2006, when sanction was granted. The removing authority of both the posts of Head Clerk and the Auditor is the Head of the Department in both the time frames. The Head of the Department is the RCS himself. Thus, ideally the sanction to prosecute A5 P. K. Thirwani ought to have been taken from the person posted as the RCS at the time of seeking sanction. To this extent, the averment of Sh. S. K. Bhatnagar is correct.
117. Reliance is, however, placed on Govind Purushottam Shahane's case (supra). PW 56 was the Chief Secretary at the time he granted sanction. He was an officer not only superior in post to the post of RCS, but also an superior officer in supervisory position. He too was competent to remove A5 P. K. Thirwani from his post of Head Clerk-cum-Auditor, which post he had abused. Consequently, a sanction to prosecute granted by such superior officer would be a valid sanction.
118. The position in respect of A3 Raman Verma is, however, different. Sanction to prosecute A3 Raman Verma was granted by Sh. A. Majumdar who deposed as PW 60. At the time of granting CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 61 of 103 CBI No. 83/19 sanction, PW 60 was posted as Secretary-cum-Director, Department of Social Welfare. He granted sanction as he was the authority competent to remove A3 Raman Verma at the said time. This was, however, on the basis of the post held by A3 Raman Verma at that time.
119. Since PW 60 was not competent to remove A3 Raman Verma from the post of DA in the office of RCS, the sanction to prosecute him granted by PW 60 is not a proper sanction. The information received from the office of RCS shows that the authority competent to remove the DA is the Head of the Department, that is the RCS. As per the information also received from the office of RCS in response to the afore mentioned notice, the RCS is in the pay scale of Rs.37,400/- to Rs. 67,000/-, as per the 6 th CPC which is a PB-4 post. Similar information was solicited from the Department of Social Welfare. The Secretary of the said Department is also in the same pay band. Both posts are, therefore, analogous. In any case, the Secretary of the Department of Social Welfare is a no manner in a supervisory post over the RCS. Thus, the sanction granted by the Secretary of Department of Social Welfare to prosecute A3 Raman Verma is not a valid sanction.
120. PW 60 has been cross-examined at length. In his cross- examination, Sh. A. Majumdar has specifically denied that he had CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 62 of 103 CBI No. 83/19 accorded the sanction without applying his mind. He has also denied having received any draft sanction order. Though he stated that he had examined the relevant documents placed before him, he could not affirm specifically that he had gone through the notings put up by A3 Raman Verma. He could also not tell specifically that he had perused the file placed on record by CBI as D-4, that is the file maintained by the RCS in respect of CBSE CGHS, containing their notings.
121. Ld. Counsel for A3 Raman Verma had also asked the witness whether he had given reasons for granting the sanction and whether he had cited the relevant documents for according sanction. The said question had been disallowed as it pertained to the contents of the sanction order. Perusal of the sanction order makes it apparent that no reasons have been stated for arriving at the decision that the sanction should be granted. Further, the sanction order does not contain even the particulars of the documents perused. It states all the facts including references to notes of particular dates and letters as a narrative. The said sanction order notes in this respect as below:
And whereas I, A. Majumdar, Secretary-cum-Director (Social Welfare), being the authority competent to remove the said Raman Verma from the office, after fully and carefully examining the relevant statement of witnesses recorded during the course of investigation, documents collected by the Investigating Agency in regard to the said allegations and the facts and circumstances of the case, consider that the said Raman Verma, should be prosecuted in the Court of Law for commission of the aforesaid offences.
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 63 of 103 CBI No. 83/19
122. The file of the Department of Social Welfare pertaining to the grant of sanction to A3 Raman Verma had been summoned by the said accused in his defence evidence. The records so produced brings to the fore following aspects regarding the grant of sanction:
1. The file contains a draft sanction order, contrary to the statement of PW 60 A. Majumdar.
2. The sanction order is almost identical to the said draft sanction order. In fact, the registration number of the Society noted in the sanction order is the same as noted in the draft sanction order which is the wrong registration number. It has been blindly copied in the sanction order and thereafter cut by hand and corrected.
3. The index to the SP's report mentions the photocopy of the notesheet file, and for that matter, of the correspondence file and the audit file to have been sent for perusal. These documents are not in the file of the Department of Social Welfare. The Senior Assistant/DW 1 who had produced the said file admitted that the photocopy of the notesheet file was not available in the file produced by him.
123. It is also mentioned in the cross-examination that the witness had sent the sanction order to the competent authority but he could not tell who was the competent authority without seeing the records. In the examination-in-chief, the witness has clearly stated that he had CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 64 of 103 CBI No. 83/19 accorded the sanction. He has also stated that he was the competent authority to remove A3 Raman Verma from service as per the Conduct Rules. A. Majumdar, PW 60 thus answered questions in the cross-examination contrary to what he had stated during the examination-in-chief.
124. The above mentioned discussion establishes that the sanction to prosecute accorded to A3 Raman Verma under Section 19 PC Act has been granted mechanically without application of mind.
125. Point no. 5 is answered in the affirmative in respect of A3 Raman Verma and in the negative qua A5 P. K. Thirwani.
Point no. 6: Whether the amended Section 19 PC Act has retrospective effect such that sanction under said provision would have been required to take cognizance of the offences qua A1 Narayan Diwakar?
126. Having answered point no. 4 in the affirmative in respect of A1 Narayan Diwakar, the present court has no jurisdiction qua him as the cognizance of the offence was bad. In such circumstance, the question whether Section 19 PC Act has to be given retrospective effect or not need not be considered.
Effect of the findings of point nos. 4 and 5 CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 65 of 103 CBI No. 83/19
127. What would be the status of a trial conducted on the basis of an invalid sanction or no sanction though it was required? The Hon'ble Supreme Court has observed in Baij Nath Tripathi Vs. The State of Bhopal, AIR 1957 SC 494 as follows:
If no Court can take cognizance of the offences in question without a legal sanction, it is obvious that no Court can be said to be a Court of competent jurisdiction to try those offences and that any trial in the absence of such sanction must be null and void, .... if any Magistrate not being empowered by law to try an offender, tries him, then the proceedings shall be void.
128. In Yusofalli Mulla vs. The King, AIR 1949 PC 264, the Privy Council held as under:
A Court cannot be competent to hear and determine a prosecution the institution of which is prohibited by law and Section 14 prohibits the institution of a prosecution in the absence of a proper sanction. The learned Magistrate was no doubt competent to decide whether he had jurisdiction to entertain the prosecution and for that purpose to determine whether a valid sanction had been given, but as soon as he decided that no valid sanction had been given the Court became incompetent to proceed with the matter.
129. In State of Karnataka vs. C. Nagarajaswamy, (2005) 8 SCC 370, the Hon'ble Supreme Court held as under:
In view of the aforementioned authoritative pronouncements, it is not possible to agree with the decision of the High Court that the trial court was bound to record either a judgment of conviction or acquittal, even after holding that the sanction was not valid. We have noticed herein before that [sic] even if a judgment of conviction or acquittal was recorded, the same would not make any distinction for the purpose of invoking the provisions of Section 300 of the Code as, even then, it would be held to have been rendered illegally and without jurisdiction.
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 66 of 103 CBI No. 83/19 The Hon'ble Supreme Court further observed as follows:
Grant of proper sanction by a competent authority is a sine qua non for taking cognizance of the offence. It is desirable that the question as regard sanction may be determined at an early stage. But, even if a cognizance of the offence is taken erroneously and the same comes to the court's notice at a later stage a finding to that effect is permissible. Even such a plea can be taken for the first time before an appellate court.
130. The position was summed up by the Hon'ble Supreme Court in Order dated 24.07.2015 passed in Nanjappa Vs. State of Karnataka, Crl. Appeal No. 1867 of 2012 as follows:
The legal position regarding the importance of sanction under Section 19 of the Prevention of Corruption is thus much too clear to admit equivocation. The statute forbids taking of cognizance by the Court against a public servant except with the previous sanction of an authority competent to grant such sanction in terms of clauses (a), (b) and (c) to Section 19(1). The question regarding validity of such sanction can be raised at any stage of the proceedings. The competence of the court trying the accused so much depends upon the existence of a valid sanction. In case the sanction is found to be invalid the court can discharge the accused relegating the parties to a stage where the competent authority may grant a fresh sanction for prosecution in accordance with law. If the trial Court proceeds, despite the invalidity attached to the sanction order, the same shall be deemed to be non-est in the eyes of law and shall not forbid a second trial for the same offences, upon grant of a valid sanction for such prosecution.
131. The Hon'ble Supreme Court then held that no purpose would be served to resume the proceedings over and again due to the CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 67 of 103 CBI No. 83/19 specific facts and circumstances of the case. It allowed the appeal and set aside the impugned order.
132. In another case, Mohd Safi Vs. State of West Bengal, AIR 1966 AIR 69, the Hon'ble Supreme Court observed as follows:
Where, therefore, a court says, though erroneously, that it was not competent to take cognizance of the offence it has no power to acquit that person of the offence. An order of acquittal made by it is in fact a nullity.
133. After referring Yusofalli Mulla's case (supra), the Hon'ble Court concluded as under:
From what we have said above, it will be clear that the fact that all the witnesses for the prosecution as well as for the defence had been examined before Mr. Ganguly and the further fact that the appellant was also examined under s. 342 cannot in law be deemed to be trial at all. It would be only repetition to say that for proceedings to amount to a trial they must be held before a Court which is in fact competent to hold them and which is not of opinion that it has no jurisdiction to hold them. A fortiori it would also follow that the ultimate order made by it by whatever name it is characterized cannot in law operate as an acquittal. In the Privy Council case it was interpreted by Sir John Beaumont who delivered the opinion of the discharge in the absence of any express provision governing the matter in the Code or it does not amount to an order of discharge. It is sufficient to say that it does not amount to an order of acquittal as contemplated by s. 403(1) and since the proceedings before the Special Judge ended with that order it would be enough to look upon it merely as an order putting a stop to the proceedings.
(emphasize supplied) CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 68 of 103 CBI No. 83/19
134. In the given circumstances, since the trial qua A1 Narayan Diwakar and A3 Raman Verma is without jurisdiction, there can be no order of acquittal passed.
135. The instant case has run its entire course, almost. All the witnesses of the prosecution have been examined, the statement of accused persons under Section 313 Cr.P.C. have been recorded. If, on account of the sanction for prosecution accorded in this case being invalid/required but not taken, the entire trial is held void ab-initio qua A1 Narayan Diwakar and A3 Raman Verma, all the time and effort invested in this case by the prosecution, accused persons alongwith their respective counsel as well as the court would go waste.
136. The charge sheet in this case was filed on 31.10.2006. 61 witnesses have been examined by the prosecution. They have also been cross-examined at length. Huge amount of court time has been utilized in the trial of the case, needless to say, at the expense of the public exchequer. Public interest would, therefore, demand that these should not be wasted. An endeavor should be made to save the testimonies of the witnesses to the extent possible to be used in the subsequent trial, if it does come to that.
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137. It would also save the said witnesses a lot of unnecessary and avoidable trouble of coming to court and deposing again, apart from the fact that they may not be able to repeat everything as they have already deposed. There are high chances that there would be improvements in their testimonies giving rise to the danger of their testimony being held unreliable.
138. The possibility that a witness would be wiser after his previous cross-examination, having come to know the defence of the accused, and will avail the opportunity to make corrections or to cover up the lapses, cannot be ruled out. This is besides the risk involved in the prosecution being not able to trace the witnesses to be examined.
139. Since the defence of the accused already stands exposed there would be a strong possibility that prosecution would also be able to strengthen its case to over come the defence of the accused.
140. In view of the foregoing discussion and the facts and circumstances of the case, the interests of justice and expediency demand that the proceedings in this case qua A1 Narayan Diwakar and A3 Raman Verma be declared a mistrial. Needless to say that the prosecution would be at liberty to seek fresh sanction from the competent authority as required under Section 19 PC Act/Section 197 CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 70 of 103 CBI No. 83/19 Cr. P.C. and file a fresh charge sheet in case the sanction is accorded. The testimonies of the witnesses recorded herein shall remain preserved to be utilized as such with the exception of testimony of PW-60 A. Majumdar in the event of fresh sanction being accorded for the prosecution of A1 Narayan Diwakar and A3 Raman Verma and the Ld. Court where the charge sheet is filed finding sufficient material to frame charges on the similar lines as framed in this case.
141. In view of the above observations and decisions in respect of point no. 4 and point no. 6, the remaining points for consideration shall be dealt with only in respect of A4 Gokul Chand Aggarwal and A5 P. K. Thirwani.
142. Points no. 7 and 8 pertain to only A5 P. K. Thirwani in the above-stated circumstances.
Point no. 7: Whether any of the officials in the office of RCS had any role in determining the list of members of the society?
143. All officials of the office of RCS function in terms of the DCS Act, Rules and Directives passed thereunder. To explore the answer to Point 3, provisions of the DCS Act, Rules and Directives need to be seen.
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144. For registration of a Co-operative Society, an application under Section 7 of the DCS Act has to be filed in the office of RCS. Such application is required by Rule 6 of the DCS Rules to be accompanied by certain documents, which includes a list of persons who have contributed to the share capital together with the amount contributed by each of them and the entrance fee paid by them [Rule 6(1)(c)].
145. The term 'member' is defined in clause (k) of Section 2 of DCS Act. Said clause is as follows:
(k) "member" means a person joining in the application for the registration of a co-operative society and a person admitted to membership after such registration in accordance with this Act, the rules and the bye laws, and includes a nominal or associate or joint member and the Government when it subscribes to the share capital of a co-operative society.
Thus, every such person who joined in the application for registration of a Co-operative Society would be a member of such society. Further, every such person who is admitted to membership post- registration of the Co-operative Society, would also be a member. The DCS Act also provides in Section 20 thereof, who may become members. Rule 24 of DCS Rules lays down the conditions to be complied with for admission to membership. Rule 25 lays down the disqualifications for membership.
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146. A Co-operative Society is required to maintain a Membership Register as provided in Rule 33 of DCS Rules. Rule 37 further requires every Co-operative Society to prepare a list of its members as on the last day of each co-operative year. Such list is further required to be available for inspection by any member of such society. The Rule further provides for the revision and finalization of said list every year. The Rule also requires that such updated list would be sent to the RCS. Section 85 DCS Act provides that every Co-operative Society shall keep a copy of certain documents including its list of members open for inspection free of charge at all reasonable times at its registered address.
147. Rule 30 lays down the procedure for dealing with an application for membership. Such application is required to be disposed off as early as possible but in no case later than one month from the date of its receipt. An appeal can be preferred before the RCS against the decision to not admit the applicant as a member.
148. Rule 31 lays down the conditions for withdrawal of membership. Rule 36 deals with expulsion of members as also a bar to such expelled members, re-admission as a member in the same society or any other society of the same class for a period of three years from the date of expulsion. The rule however grants the RCS CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 73 of 103 CBI No. 83/19 the power to sanction such re-admission on an application by either such society or the expelled member.
149. Rule 40 provides for cessation of membership. It lays down that a person ceases to be a member of a Co-operative Society on:
- his resignation being accepted, or
- transfer of whole of his share of capital or interest in the society to another member, or
- his death, removal or expulsion or incurring any of the disqualifications specified in the Act and Rules.
150. Section 40 of the DCS Act provides that any register or list of members or share kept by any Co-operative Society shall be prima facie evidence of:
- the date on which any person entered in such register or list became a member;
- the date on which any such member ceased to be a member.
151. Further, Section 28 of the DCS Act states that the final authority for the management of the Co-operative Society shall vest in the general body of members. It also provides that where the bye- laws of a Co-operative Society provides for the constitution of a smaller body consisting of delegates of members of society elected or selected in accordance with such bye-laws, the smaller body shall CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 74 of 103 CBI No. 83/19 exercise such power of the general body as may be prescribed or as may be specified in the bye-laws of the society. Management of the Co-operative Society would include admission and removal of members of such society.
152. Perusal of all these provisions in the DCS Act and Rules reveals that subject to the eligibility criteria given in the various provisions of the said Act/Rules, every Co-operative Society can admit or remove members. The Co-operative Society that is to say, its general body of members are responsible for decisions concerning enrollment of members and removal of members.
153. This is however, subject to two situations, also enumerated in the DCS Act and Rules. One of the said situations is the power of the RCS to sanction re-admission of an expelled member. Such sanction can be given on an application of either the expelled member or by the Society concerned. The other situation is given in Section 76, which provides for appeals. The decision of a Co-operative Society refusing admission to a person duly qualified for such membership under the bye-laws of the society may be appealed against. Similarly, an appeal lies against the decision of a Co-operative Society expelling any of its member. Therefore, except to the above-stated statutory circumstances, the enrollment and removal of members is the sole prerogative of the Co-operative Society concerned.
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154. It is nobody's case that any application was moved by any expelled member for sanction for admission as a member of CBSE CGHS before the RCS or that any appeal was filed against permission for admission as a member of CBSE CGHS being not granted by the Society. Ergo, the members were admitted/removed and finalized only by the Society. The list of members too was maintained by the Society. Only a copy of it was required to be sent to the RCS. No official of the office of RCS thus had any role in the finalization of the list of members of CBSE CGHS. Point 3 is answered accordingly.
Point no. 8. Whether any provision of DCS Act, Rules or any Directive passed under the DCS Act was violated while auditing CBSE CGHS?
(Point reframed as the case is to be considered on its merits only qua A5 P. K. Thirwani amongst the three accused public servants.)
155. The prosecution has stated that the Society was defunct. Sh. S. K. Bhatnagar, Ld. Counsel for A5 P. K. Thirwani submitted that the said assertion is wrong inasmuch as an order is passed for a society to be declared defunct in terms of Rule 2 (viii) of DCS Rules while no such order was passed with respect to CBSE CGHS.
156. A 'defunct' society is defined in Rule 2 (viii) of DCS Rules, 1973 as follows:
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(viii) "Defunct society" means a co-operative society classified as such during the course of an audit or enquiry or inspection or after reasons to be recorded in writing declared as such by the Registrar.
Though the definition talks about a declaration in writing by the RCS, no other provision in either the DCS Act or Rules provides for such a declaration being made. Admittedly, there is no such declaration in writing or otherwise made by the RCS qua the society. CBSE CGHS was also not classified as a defunct society during the course of an audit or inquiry or inspection. There is also no record of any inquiry or inspection being conducted of CBSE CGHS.
157. Ergo, it would not be wrong to say that CBSE CGHS was never classified or declared as a 'defunct' society. Be that as it may, the case of the prosecution is that the society was functional only till the year 1990 and that thereafter no activity took place in the society. Over emphasis on the usage of the word 'defunct' by the prosecution would be misplaced.
158. Coming to the role of A5 P. K. Thirwani, A5 P. K. Thirwani had been appointed Auditor to audit the accounts of CBSE CGHS. The appointment of the said accused Auditor was approved on 31.03.2003. The audit was to be conducted from the start as the Society had not been audited before. Post audit, A5 P. K. Thirwani filed the audit report dated 05.05.2003, placed on record as D6, Ex.
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 77 of 103 CBI No. 83/19 PW 12/A-14. The audit report is annexed with the copies of accounts furnished by the Society for the various years.
159. Sh. S. K. Bhatnagar, Ld. Counsel for A5 P. K. Thirwani has contended that A5 P. K. Thirwani is not a public servant. Ld. Counsel refers to Section 89 of DCS Act, 1972 and Section 2 (b) & 2 (c) (i) of PC Act, which contains the definition of 'Public Duty' and 'Public Servant'.
160. Section 89 of DCS reads as follows:
89. Liquidator to be public servant Any person appointed as liquidator under the provisions of this Act or the rules shall be deemed to be a public servant within the meaning of section 21 of the Indian Penal Code (45 of 1854).
161. Ld. Counsel submits that since Section 89 DCS Act only specifies for a liquidator to be a public servant, an auditor would not be one. However, such an interpretation is not possible. The provision only states that any person appointed as liquidator under the Act shall be deemed to be a public servant. Nothing more can be inferred from the said provision.
162. Ld. Counsel further refers to Rule 84(1) of DCS Rules. It is submitted that as per DCS Rule 84(1), the audit of co-operative society can be done by departmental auditor or certified auditor CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 78 of 103 CBI No. 83/19 (Chartered Accountant, Govt. diploma holder in Coop Accounts etc.) Certified Auditor are on panel of RCS and are paid by the societies for the audit done by such certified auditors. Such certified auditors are not Government servants, and cannot be termed as Public Servants under Sec.2 of PC Act 1988. Further that the auditor is paid for auditing the society by the society. Hon'ble Supreme Court in State of Maharashtra Vs Laljit Shah and others, AIR 2000 Supreme Court 937 is contended to have held that officials of Registrar Co- operative Societies are not public servants within the meaning of section 2 of PC Act and as such, provision of PC Act 1988 would not be applicable to the applicant. This is stated to have been further adopted by three judges' bench of Hon'ble Supreme Court in Greater Bombay Co-operative Bank's case (supra).
163. Rule 84, DCS Rules provides the procedure for appointment of Auditors and for conducting audit. Sub Rule 1 thereof reads as follows:
1. The audit of accounts of the societies shall be conducted by departmental auditors appointed by the Registrar or by Certified Auditors appointed by the Registrar from time to time on such terms and conditions as he deems fit.
Explanation 2 to sub-Rule 1 lists those people who would be included as a certified auditor. Neither the DCS Rules nor the DCS Act contains any definition of a departmental auditor. The words would imply a person employed with the department and given the CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 79 of 103 CBI No. 83/19 task of auditing the societies. Thus, while certified auditors would not be public servants, the same cannot be stated for the departmental auditors. The said differentiation is also borne out from Sub-Rule 3 of Rule 84 DCS Rules which requires the amount payable to the departmental auditor to be deposited in the Government account, while the amount payable to the certified auditor is payable directly to them.
164. As regards Laljit Shah's case (supra), the said decision is in respect of the officers of the Managing Committee of the Co- operative Societies. It is not in respect of the officials of the office of RCS. Reference to the said decision and consequently to Greater Bombay Co-operative Bank's case (supra) is thus misplaced.
165. Coming to the definitions of public duty or public servant in PC Act, Section 2 (b) contains the definition of public duty as follows:
(b) 'public duty' means the duty in discharge of which State, the public or the community at large has an interest.
2 (c) (i) PC Act contains the definition of public servant as follows:
(c) "public servant"means--
(i) any person in the service or pay of the Government or remunerated by the Government by fees or commission for the performance of any public duty;
2 (c) (viii) shall also be relevant and is therefore, reproduced below:
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(viii) any person who holds an office by virtur of which he is authorized or required to perform any public duty;
166. The definition as given in 2 (c) (i) is sufficient to hold that A5 P. K. Thirwani is a public servant as he was in service of Government.
167. Auditing a Co-operative Society is a function in which the State has an interest. Auditing a Group Housing Society is a function in which not only the State but the public community also has an interest as a Group Housing Society obtains benefit by receiving land from the State. Such benefit ought not to be available to a society not following the rules and regulations, of which audit is one essential requisite. Auditing a Group Housing Society by a departmental auditor thus would constitute public duty within the definition of 2(b) PC Act.
168. A5 P.K. Thirwani performed the public duty of auditing a Group Housing Society. He performed the said duty by virtue of his being employed in the said department. Had he not been so employed in the department, he could not have been a departmental auditor. There is thus no doubt that A5 P.K. Thirwani was a public servant and was performing a public duty.
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169. The first most thing worth noting regarding the audit is the date of the audit. A major contention made on behalf of A5 P. K. Thirwani is that he had no role in the approval of freeze list as the audit was conducted prior to the request letter dated 13.06.2003 being even received in the office of RCS. The Society was inactive for a long period of 13 years, to the extent that it was not even responding to the letters/notices issued to it by the office of RCS. The Society had not been audited ever since its inception. The Society was formed and registered in the year 1984. The notings of the file of RCS, placed on record as D4, also show that the last communication received from the Society prior to the request letter dated 13.06.2003 was in respect of elections conducted in the society on 04.02.1990. Thus, evidently, the Society was not inactive till the year 1990. Yet, for the said about 5/6 years, audit of the Society was not conducted. Thereafter, there was no activity on the part of the society.
170. Out of the blue, on 27.03.2003 the form of option-cum- appointment of auditor is filled on behalf of the Society, opting for A5 P. K. Thirwani as auditor, which is accepted by him and approved by the AR (Audit). It is also pertinent to note that the approval for the said appointment was given by A2 J. S. Sharma (since deceased) albeit as the AR (Audit). However, there is nothing on record to point towards any illegal or motivated reason for the appointment. The notings file of the office of RCS placed on record does not contain CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 82 of 103 CBI No. 83/19 any notings of the audit branch. Apparently, the audit branch must have its own file which has not been seized during the investigation and is not on record and thus not available for perusal. Ergo, though bewildering, no adverse inference can be drawn from the convenient timing of the audit of the Society.
171. Sh. S. K. Bhatnagar referred to Sections 28, 40 and 85 of the DCS Act and Rule 37 of the DCS Rules. He also submitted that there is no provision in either the Act or the Rules that the list of members would be sent to the DDA only after a society is audited. There is also stated to be no allegation that the list of members was approved on the basis of the audit report.
172. Sections 28, 40 and 85 of the Act and Rule 37 of the Rule have been discussed before. No doubt, there is no provision which mandates that the audit of a society has to be conducted as a pre- requisite to sending its list of members to DDA. However, the DCS Act and Rules do not lay down a specific procedure to be followed by the officials of the office of the RCS. At the same time, audit is an annual requirement as laid down in Sub-section 1 of Section 53, DCS Act. A Co-operative Group Housing Society is a society formed with the object of providing its members with dwelling houses subject to the provisions of the DCS Rules and on the conditions to be determined by the Lt. Governor from time to time and may be of any CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 83 of 103 CBI No. 83/19 of the four types mentioned in Clause (d) of Rule 4 (1), which also provides the above definition of a CGHS. Hence, a society formed for the said purpose also requires to be audited every year. It goes without saying that the State machinery cannot be put to use by any CGHS to procure land without following the rules and regulations laid down by the DCS Act and Rules. Even if there is no specific provision saying that the audit of the society has to be conducted prior to the freeze list being approved, it is implicitly mandated by the Act and Rules. While audit may not be directly related to the finalization of list of members and approval thereof, it is a mandatory and essential step in the governance of a CGHS without which any CGHS cannot expect to reap benefits through the State.
173. Sh. Bhatnagar further contended that the audit report was checked by the DA/Karnal Singh and the AR (Audit) and no objections were raised by either of them to the audit report. The audit report and related documents were placed by CBI in D-6, marked as Ex. PW 12/A-14 and proved by PW48 Dharamvir Singh, who was posted in the office of RCS as Head Clerk and was in the audit branch after the year 2000. He had worked with A5 P. K. Thirwani and could thus identify his handwriting and signature. Although the page titled 'Check List for Submission of Audit Report' bears a signature of a DA, the said signature has not been identified by any witness. Be that as it may, it is correct that the signature of CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 84 of 103 CBI No. 83/19 the DA is in respect of having examined the audit report and submitted for signature. Thus, the contention that the DA had checked the same and raised no objections has to be accepted on the face of the audit report. Same is the position qua AR (Audit). At the cost of repetition, it may be reiterated that the notings file of the audit branch is not available as it has not been placed on record.
174. The accompanying contention that since no objections were raised by the DA, the audit was done properly without any violation of DCS Act, Rules and Directives passed thereunder can, however, not be accepted. It would be appropriate to note another contention of Ld. Counsel for A5 P. K. Thirwani at this point that the DCS Act does not specify that the audit has to be done at the registered office. Further that, even if it is done at any other place with the permission of the RCS, the audit would not change.
175. Rule 84 of the DCS Rules lay down the procedure for appointment of Auditor and for conducting audit. Sub-Rule 5 thereof provides as under:
5. Unless the Registrar directs otherwise, the audit of a co-
operative society shall be conducted in the registered office of the society.
The said sub-Rule thus mandates that the audit of a Co-operative Society shall be conducted only in its registered office. Permission of CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 85 of 103 CBI No. 83/19 the RCS is required if the audit is to be conducted elsewhere. Thus, the contention of the Ld. Counsel that the DCS 'Act' does not specify the place where the audit is to be conducted is beating around the bush. Admittedly, no permission was granted by the RCS to conduct the audit of CBSE CGHS at any specific place other than its registered office.
176. The audit report, at page 101 of D-6/Ex. PW 12/A-14, contains the address of CBSE CGHS as C-29, Community Centre, Naraina, N. Delhi. The Option-cum-appointment letter for conducting statutory audit, placed at page no. 106 of D-6/Ex. PW 12/A-14, purportedly signed by Madhu Aggarwal on behalf of the Society and accepted by A5 P. K. Thirwani as the Auditor also contains the address of CBSE CGHS as C-29, Community Centre, Naraina, New Delhi. Same address is noted as the address of the society in Annexure-A titled 'Brief Summary of the Society' which is also signed by the office bearers of the Society as well as A5 P. K. Thirwani as the Auditor. No document which is part of the audit report contains any other address of the Society.
177. The Auditor is expected to mention in his report the address of the place where he has conducted the audit. Now, it may be argued there is no such provision in the Act or the Rules requiring the Auditor to mention the said address. Yet again, this requirement is a CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 86 of 103 CBI No. 83/19 requirement by pure common sense. Having mentioned the address of Naraina in the audit report, by implication the audit was conducted at the address of Naraina i.e. C-29, Community Centre, Naraina, New Delhi. However, the office of CBSE CGHS had shifted from the said address to Shiksha Kendra, 2 Community Centre, Preet Vihar, Delhi-92 way back in 1990. The RCS office had been intimated said address. The contention of the accused person is that said 'change of address' was not approved.
178. In this context, the statement of JR/PW58 R.K. Bhatnagar, is as follows:
After going through the notings dated 29.05.1990 at page 9/N and 10/N (which is now marked as Ext. PW 58/DA and already exhibited as Ext. PW36/PX1 and Ext. PW 36/PX2, it appears that a letter was received from the society for change of address in the year 1990 from Naraina to Preet Vihar. However, since none appeared from the society before RCS despite letters from the RCS being sent to the society, the change of address of the society was not approved by the Registrar.
179. As per the said notings, it is correct that none appeared for verification of final list, elections and change of address. However, neither any provision of the Act nor any rule requires change of address of any society to be verified. In fact, the RCS is only required to be intimated by any change in address. Section 84, dealing with the address of the societies clearly so. The same is reproduced below:
84. Address of societies CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 87 of 103 CBI No. 83/19 Every cooperative society shall have a address registered in the manner prescribed to which all notices and communications may be sent, and shall send to the Registrar notice of every change thereof with thirty day days of such change.
(emphasis supplied)
180. Ergo, while the final list, elections etc. may have required verification, change of address did not. There was thus no question of said change of address not being 'approved'. In fact, even the Rohini Address was accepted without approval from the RCS.
181. Whether approved or not, factually CBSE CGHS was not available at the Naraina address. Then, how could A5 P. K. Thirwani visit the said 'office' of the Society and audit the Society there. A5 P. K. Thirwani has not mentioned any other address in his report. It is thus apparent that something is amiss in the audit. Having said that, it cannot be held that A5 P. K. Thirwani had deliberately noted the said address. It could have been a genuine mistake or pure carelessness.
182. It would do well to note here that there is no evidence to show that A5 P. K. Thirwani was part of a criminal conspiracy. To establish criminal conspiracy, it is essential to prove a 'meeting of mind' between the conspirators. It is also trite to say that conspiracy is invariably hatched in secrecy and thus, there will normally not be any direct evidence of the same. Whether there exists a criminal conspiracy or not, whether a person is a conspirator or not, has to be CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 88 of 103 CBI No. 83/19 more often than not, made out from the circumstances. At the same time, the circumstances should be compelling enough to rule out every other possibility except that the person is part of the conspiracy. Every deviation in act or conduct cannot be read as a 'circumstance' showing conspiracy.
183. It is also a settled principle that where two views are possible, the view favouring the accused has to be accepted.
184. Coming back to the issue-at-hand, there is no material on record to rule out the possibility that noting the wrong address of the Society in the audit report was not a mistake or carelessness or that it was only in pursuance of the criminal conspiracy. This aspect thus does not incriminate A5 P. K. Thirwani.
185. The requirement of auditing the societies is provided in Section 53 of DCS Act, 1972. Sub-section (1) thereof reads as follows:
(1) The Registrar shall audit or cause to be audited by a person authorised by him by general or special order in writing in this behalf, the accounts of every co-operative society at least once in each year.
Thus, every co-operative society is required statutorily to be audited at least once in each year. The proviso to Sub-rule (1) of Rule 84 of CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 89 of 103 CBI No. 83/19 DCS Rules requires that an auditor can undertake the audit of the society for a maximum period of three years.
186. The audit in the present case was conducted from 09.02.1984 to 31.03.2002. The same was in violation of the provision noted above as it was much beyond the three year limit prescribed by the rules. Yet, it has no reflection on A5 P. K. Thirwani as he had been appointed Auditor by the office of the RCS.
187. The prosecution has further contended that the audit was not carried out properly. The audit was done fraudulently and dishonestly to favour the Society. It is stated that the copies of accounts annexed with the audit report as well as the report itself were purportedly signed by B.S. Kohli, Madhu Aggarwal and Satish Aggarwal, as the office bearers of the Society. B.S. Kohli/PW12 and Madhu Aggarwal/PW59 have denied these signatures. Madhu Aggarwal has in fact claimed that she is not a member of this society. Satish Aggarwal is not traceable, and is claimed to be a non-existing fictitious person.
188. As the Ld. Counsel for A5 P. K. Thirwani has pointed out, the audit was conducted till 2002 but the audit was done on 05.05.2003. A list of members of the year 2002 is annexed with report, part of the documents furnished by the Society for the year 2002. Name of CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 90 of 103 CBI No. 83/19 Satish Aggarwal does not feature in the list. A5 P. K. Thirwani was thus aware that Satish Aggarwal was not a member till 2002. Nevertheless, there was nothing to rule out the possibility of him having been enrolled thereafter and before the audit was done, and also to have become an office bearer. A5 P. K. Thirwani was not required to see and verify the documents beyond 2002. Also, the copy of the accounts could have been furnished by anyone. It is the society's responsibility to ensure safe custody of its accounts and other documents. No doubt, he could have, and probably should have, verified the identity of the office bearers. Not doing so only proves that A5 P. K. Thirwani is not very efficient in his work, nothing more.
189. The other ground for claiming fraudulent auditing is stated to be proper objections not being taken by A5 P.K. Thirwani regarding the lapses noticed in the accounts of the Society. It is submitted that the balance available with the Society is stated to be Rs.10,083.76/- while the balance in the account of the Society was Rs.22,299/- . In this regard, it would suffice to note that A5 P. K. Thirwani raised an objection in his report regarding 'reconciliation of accounts'.
Point no. 9: Whether the accused persons have committed the offences they are charged with?
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190. Sh. S. K. Bhatnagar, Ld. Counsel for A5 P. K. Thirwani has contended that the IO D. Damodaran, PW 61 was not competent to investigate the matter as he was the Sub Inspector when the case was entrusted to him for investigation. Relying upon Section 17 of PC Act, the Ld. Counsel contended that he was not competent to investigate the case without permission of the Metropolitan Magistrate to do so. The said contention has no legs to stand. The request for permission to investigate the case was made by the IO and has been proved by him as Ex. PW 61/A. Vide order dated 10.01.2006, the then Ld. Special Judge permitted him to investigate the case. The said order is at point X on Ex. PW 61/A. A4 Gokul Chand Aggarwal
191. A4 Gokul Chand Aggarwal is alleged to be the key person behind the alleged criminal conspiracy. He is alleged to have taken over the records of the Society from PW 12 B. S. Kohli and thereafter manipulated and fabricated records which were used as genuine. A4 Gokul Chand Aggarwal is alleged to have visited the office of RCS as B. S. Kohli and signed his presence as such in the capacity of the President of the Society.
192. In support of the said allegations, the CBI has relied upon the fact that the address 'Shop No. 25, CSC-1, DDA market, E-15-16, CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 92 of 103 CBI No. 83/19 Sector-8, Rohini, Delhi' is noted as the correspondence address of the Society in the letter requesting approval of freeze strength dated 13.06.2003/Ex. PW 12/A-6. The said shop is stated to be owned by A4 Gokul Chand Aggarwal. An UDC from DDA, Damodar Sati was examined as PW 43. On directions of the then Dy. Director, he had furnished a photocopy of documents placed in their file pertaining to the tender held on 22.09.1998 in respect of the abovestated shop. The said shop had been alloted to A4 Gokul Chand Aggarwal in the said tender. The file also contained the photograph of A4 Gokul Chand Aggarwal. Perusal of the said documents establish the ownership of A4 Gokul Chand Aggarwal over the said shop, which was being used as the correspondence address of the Society.
193. Nevertheless, mere ownership of the shop which was used as the correspondence address of the Society does not involve A4 Gokul Chand Aggarwal on its own. There is no evidence on record that the shop was actually being used by the Society. The IO D. Damodaran, PW 61 has admitted in his cross-examination that he did not search the said shop. There is also no other witness testifying that the affairs of the Society were managed from the said shop.
194. Except for the self serving testimony of PW 12 B. S. Kohli, there is no evidence, oral or documentary reflecting that A4 Gokul Chand Aggarwal had taken over the records from PW 12 B. S. Kohli.
CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 93 of 103 CBI No. 83/19 The said witness has stated in his examination that he had handed over the records without obtaining any receipt from A4 Gokul Chand Aggarwal. He also states that A4 Gokul Chand Aggarwal had approached him for getting the freeze list of the Society approved and he had stated that he was working in the office of RCS. The witness further stated that after some time, he asked A4 Gokul Chand Aggarwal over mobile phone to hand back the documents to him but he was told that the documents have been misplaced. In the cross- examination, he adds to his story and states that A4 Gokul Chand Aggarwal had told him that he was a consultant of 4-5 societies and he could get this Society revived. He further stated that he had agreed to pay Rs.5,000/- to A4 Gokul Chand Aggarwal for revival of the Society though he admits that he had not given the amount to A4 Gokul Chand Aggarwal. The witenss further admits that he did not make any complaint to any authority when A4 Gokul Chand Aggarwal did not return the records to him.
195. The investigation is alleged to have been unfair and biased. It is alleged on behalf of A4 Gokul Chand Aggarwal that PW 12 B. S. Kohli was given an escape route by fabricating the story of his handing over the records to A4 Gokul Chand Aggarwal. While there is no evidence in support of such contention, considering the fact that PW 12 B. S. Kohli was named in the FIR along with A4 Gokul Chand Aggarwal, any statement made by PW 12 B. S. Kohli has to CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 94 of 103 CBI No. 83/19 be taken with a pinch of salt. Without corroboration, his statement cannot be accepted at face value.
196. CBI further relies upon the opinion of the GEQD in respect of A4 Gokul Chand Aggarwal. PW 57 Dr. Ravindra Sharma, Dy. GEQD, CFSL, Shimla opined in his report dated 08.08.2006 Ex. PW 57/PA that A4 Gokul Chand Aggarwal had made many of the questioned signatures in the various documents including affidavits on behalf of the members. Based on the said report, CBI claims to have established that A4 Gokul Chand Aggarwal committed forgeries.
197. In respet of the GEQD opinion, Ld. Amicus Curiae on behalf of A4 Gokul Chand Aggarwal has relied upon S. P. S. Rathore's case (supra). Ld. Counsel referred para no. 30 thereof which is as follows:
It is thus clear that uncorroborated evidence of a hand writing expert is an extremely weak type of evidence and the same should not be relied upon either for the conviction or for acquittal. The courts, should, therefore, be wary to give too much weight to the evidence of handwriting expert. It can rarely, if ever, take the place of substantive evidence. Before acting on such evidence, it is usual to see if it is corroborated either by clear, direct evidence or by circumstantial evidence.
198. Another aspect in related to the handwriting opinion is the objection that the specimens of the accused have been taken without CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 95 of 103 CBI No. 83/19 the permission of the court. It is thus contended that such specimens cannot be relied upon.
199. Considering the second aspect first, the Order dated 05.03.2015 passed by Hon'ble High Court of Delhi in Crl. Appeal no. 124/2013 titled as Rekha Sharma vs. CBI, has observed that "Expert evidence in the form of report on handwriting and signature specimens is not barred from consideration on the ground that they were obtained without permission of court." The Hon'ble High Court of Delhi has further observed as follows:
The investigating officer in a criminal case is empowered under Section 2(h) Cr.P.C to collect evidence and undertake various steps in that endeavor. The Supreme Court in Selvi v. State of Karnataka, (2010) 7 SCC 263 has endorsed this view and held that the term "investigation" includes steps which are not exhaustively and expressly enumerated. Even otherwise, experience suggests that every crime requires its own tailor made investigation which may be peculiar to the circumstances of the case. It would not be prudent and neither possible to exhaustively catalogue such steps taken during investigation in a code like Cr.P.C. Thus absence of a specific provision enabling a particular step under investigation does not imply that the investigation agency is disabled from taking that step under its power/duty (power coupled with duty) to conduct investigation.
The contention of the Ld. Amicus Curiae can thus not be accepted. The report of the expert analysing the specimens cannot be rendered inadmissible on the ground that it was obtained in violation of the prescribed procedure.
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200. It has been held in a catena of cases that the sole evidence of a handwriting expert is normally not sufficient for recording a definite finding about the writing being of a certain person or not. The evidence of a handwriting expert is, unlike that of a finger print expert generally of a frail character. The courts are therefore wary to give too much weight to the evidence of the handwriting expert. Corroboration of such opinion of the handwriting expert is generally looked for.
201. While the GEQD report opines that A4 Gokul Chand Aggarwal made signatures of different persons in certain documents, there is no opinion to the effect that the signatures in the name of 'B. S. Kohli' in note dated 08.07.2003 Ex. PW 12/A-10, note dated 24.07.2003 Ex. PW 57/13 and note dated 08.08.2003 Ex. PW 12/A- 11 were made by A4 Gokul Chand Aggarwal. The opinion only states that the said signatures at Q-337, Q-340 and Q-343 were not made by PW 12 B. S. Kohli.
202. The above two evidence that is the GEQD opinion and the statement of PW 12 B. S. Kohli is the only evidence on record which is against A4 Gokul Chand Aggarwal. As stated above, neither is reliable evidence on it own. They also do not provide corroboration to each other. In absence of any cogent and reliable evidence, direct or circumstantial showing that A4 Gokul Chand Aggarwal was CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 97 of 103 CBI No. 83/19 connected with CBSE CGHS or that CBSE CGHS was connected with the shop of A4 Gokul Chand Aggarwal, the involvement of A4 Gokul Chand Aggarwal cannot be accepted.
Existence of criminal conspiracy
203. It would be worthwhile to mention here that there is absolutely no evidence on record against either A4 Gokul Chand Aggarwal or A5 P. K. Thirwani showing any meeting of mind between the two or with any of the other accused persons in respect of the alleged criminal conspiracy. No doubt, there would hardly be any direct evidence showing such meeting of mind. Yet, the circumstances should reflect the agreement between the parties to achieve some common purpose. The evidence does not even reflect that A4 Gokul Chand Aggarwal or A5 P. K. Thirwani knew each other, much less that they agreed to carry out an illegal act or an act which is not illegal by illegal means. It also does not reflect any agreement between these two accused persons or either of them with any other accused person. The defence has mentioned that the CDR of A1 Narayan Diwakar has not been proved. It is indeed not proved and can thus not be read in evidence. There is not even an iota of evidence linking A4 Gokul Chand Aggarwal with any of the other accused persons. As regards A5 P. K. Thirwani, the only think that links him with either A1 Narayan Diwakar or A3 Raman Verma is CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 98 of 103 CBI No. 83/19 that they all worked in the same office, rather A5 P. K. Thirwani worked under A1 Narayan Diwakar.
204. Ld. Counsel referred to Dinesh Chand Shukla vs. State (NCT of Delhi), 2007 IV AD (Delhi) 173 to contend that A8 P. K. Thirwani can not be a part of any conspiracy. It is contended that it has been held in the abovesaid referred case that an Accountant, Auditor and Lawyer are not liable as they cannot be conspirators.
205. In Dinesh Chand's case (supra), the Hon'ble Apex Court has relied upon Hira Lal Jain vs. Delhi Administration, 1973 SCC (Crl.)
309. In Hira Lal's case (supra) wherein the Hon'ble Apex Court was dealing with a case alleging conspiracy against an advocate. In Dinesh Chand's case (supra), the Hon'ble Court was considering allegation of conspiracy levelled against a Charted Accountant. In Hira Lal's case (supra), the Hon'ble Supreme Court observed that there was no evidence to suggest that the lawyer had previous knowledge of the fact that the accused were not the rightful claimants. Further that, there was no evidence pointing out any concert between the lawyer and the other accused. The Hon'ble Supreme Court held that in absence of such evidence it could not be said that there is prima facie evidence of the offence of conspiracy against the lawyer. In Dinesh Chand's case (supra), the Hon'ble Apex Court observed that the Charted Accountant's role could not be CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 99 of 103 CBI No. 83/19 characterized as a conspirator in the facts of that case. Thus, both decisions were based on their particular facts. Further more, neither decision talks of the role of an auditor. It can thus not be said that the Hon'ble Supreme Court mandated absolutely that a lawyer or Charted Accountant cannot be a conspirator.
A5 P. K. Thirwani
206. It has been seen that no provision of DCS Act, Rules or any Directive passed thereunder was violated by A5 P. K. Thirwani in conducting the audit of the Society. He has also been found to be not a part of the alleged criminal conspiracy.
207. The Ld. Special Senior PP has, however, contended that a public servant would be liable under Clause (iii) of Section 13 (1) (d) PC Act if his actions while holding office result in obtaining for any person any valuable thing or pecuniary advantage without any public interest. Ld. Counsel relies upon Runu Ghosh's case (supra); Noida Entrepreneurs Association's case (supra) and LIC of India's case (supra) in support of his contentions. It is contended that an attempt was made by all the accused public servants to benefit the Society by forwarding the list of members which would have resulted in the allotment of land by DDA.
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208. The Ld. Defence Counsel has submitted that there is no evidence of any such obtainment of benefit, any valuable thing or pecuniary advantage due to the actions of A5 P. K. Thirwani. It is contended that there was not even an attempt made for the same as no land was alloted to the Society.
209. The cases referred to by the Ld. Special Senior PP would be applicable if there is evidence to the effect that the accused public servant in question was instrumental in obtaining any valuable thing or pecuniary advantage to anyone by his action. In the present case, it has been seen that the actions of A5 P. K. Thirwani as an Auditor who audited the Society did not result in any pecuniary advantage of valuable thing to anyone, not even the Society. He audited the Society on the basis of the documents furnished to him on behalf of the Society for correctness of which the Society is responsible. No illegality in the conduct of the audit has come to fore. There is also no evidence to point out that he made deliberate special concessions in the act of auditing with the aim of benefiting someone. His actions would thus not be covered under Clause (iii) of Section 13 (1) (d) PC Act.
210. There is no evidence on record to even suggest that he, by corrupt or illegal means or by abusing his position as a public servant, obtained for himself or any other person any valuable thing CBI Vs. Narayan Diwakar & Ors. Judgment dated 30.11.2022 (CBSE CGHS) Page 101 of 103 CBI No. 83/19 or pecuniary advantage. Nothing incriminating has been recovered from A5 P. K. Thirwani. There is not even an allegation of any pecuniary benefit gained by the said accused. Even attempt to commit the offence under Section 13 (1) (d) PC Act was not made by A5 P. K. Thirwani for the reasons stated above.
Result Qua A1 Narayan Diwakar and A3 Raman Verma
211. As noted above, the proceedings in this case qua A1 Narayan Diwakar and A3 Raman Verma are declared a mistrial. The prosecution would be at liberty to seek fresh sanction from the competent authority as required under Section 19 PC Act/Section 197 Cr. P.C. and file a fresh charge sheet in case the sanction is accorded. The testimonies of the witnesses recorded herein shall be preserved to be utilized as such (with the exception of testimony of PW-60 A. Majumdar) in the event of fresh sanction being accorded for the prosecution of A1 Narayan Diwakar and A3 Raman Verma and the Ld. Court where the charge sheet is filed finding sufficient material to frame charges on the similar lines as framed in this case.
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212. In view of the foregoing discussion, A4 Gokul Chand Aggarwal and A5 P. K. Thirwani stand acquitted of the charges framed against them. RUBY Digitally signed by RUBY ALKA ALKA GUPTA Date: 2022.12.01 GUPTA 16:46:29 +0530 Announced in the (RUBY ALKA GUPTA) open Court Special Judge (PC Act) (CBI)16 on 30th November, 2022. Rouse Avenue District Courts New Delhi.
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