Delhi District Court
Cbi vs . (1) Smt.Sheila Kaul (Since Deceased) on 29 February, 2016
1
IN THE COURT OF SH. SANJEEV AGGARWAL:
SPECIAL JUDGE: CBI03 (PC ACT): DELHI
CC No.12/15 RC : 48(A)/1996
PS : CBI/ACB/ND
U/s : 120B r/w Sec.409 IPC and Sec.
13(2) r/w Sec.13(1)(d) and 13(1)
(c) of PC Act, 1988.
CBI Vs. (1) Smt.Sheila Kaul (since deceased)
W/o Lt. Sh.K.N.Kaul
formerly Minister for Urban Affairs &
Employment, New Delhi,
R/o Everest House, Opp. Pawan Cinema,
G.T.Road, Ghaziabad (U.P).
(2) P.K.Thungon
S/o Sh.P.W.Thungon
Formerly Minister of State in the M/O UA&E, ND
R/o flat no.7, Yashwant Place, New Delhi
Permanent address Thungon House, Bomdila,
West Kameng District, Arunanchal Pradesh.
(3) Lakhpa Tsering
S/o Sh.Tsering Gyurme
R/o Village Dirang, Distt.West Kameng
Arunanchal Pradesh
presently residing at RZ53, Raj Nagar,
Palam Colony, New Delhi.
RC NO. 48(A)/1996
CBI vs. Sheila Kaul & ors. 1 of 194
2
(4) Smt.Krishna
w/o Late Sh.Krishna
R/o 65, Hari Nagar Ashram,
New Delhi.
(5) Smt.Tulsi Balodi (since deceased)
W/o Sh.P.B.Balodi
R/o 67, TypeII, Minto Road,
New Delhi.
Date of Institution : 06.06.1998
Judgment Reserved : 10.02.2016
Judgment Delivered : 24.02.2016
J U D G M E N T
1. In brief, prosecution case is, that the Hon'ble Supreme Court of India, vide order dated 14.02.96 passed during the hearing of writ petition No.585 of 1994 directed the CBI to enquire into the allegations of corruption and bribery in the matter of out of turn allotment of Government accommodation/shops etc. and if the allegations are substantiated then to register cases against the persons who are prima facie found responsible. After the preliminary enquiries, case RC 48(A)/96DLI was registered in ACB branch of CBI, New Delhi on 16.06.96 against Smt. Sheila Kaul and others on the allegation that Smt. Sheila Kaul while working as RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 2 of 194 3 Union Minister in the Ministry of Urban Development (Lateron renamed as Ministry of Urban Affairs and Employment) New Delhi entered into a criminal conspiracy with her Minister of State Sh.P.K.Thungon and others and by abusing her official position as the Union Minister for Urban Development (UDM) and as a public servant in her capacity as the custodian of Government shops/stalls, dishonestly allotted shops on economic licence fee basis with a view to cause pecuniary gain to the allottees and corresponding wrongful loss to the Government in contravention of the rules/instructions governing such allotments without calling for any competitive tenders/applications from general public. Thorough investigation has revealed three distinct instances of criminal conspiracy as well as abuse of official position by Smt.Sheila Kaul and others during the period from October, 1991 to July, 1995. The instant case relates to the acts of criminal conspiracy, abuse of official position and criminal breach of trust committed by the accused persons during the period 1993 to 1994 as per details given hereunder:
2. Investigation has revealed that Smt.Sheila Kaul (A1) remained posted as Union Minister for Urban Development, which Ministry was later on renamed as the Ministry of Urban Affairs & Employment, New Delhi, during the period from June 1991 to RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 3 of 194 4 September, 1995 and Sh.P.K.Thungon (A2) remained posted as Minister of State in the said Ministry during the period from January, 1993 to September, 1995. The accused persons A3 to A5 are the private persons who in criminal conspiracy had obtained undue pecuniary benefits.
3. Investigations further revealed that the accused persons A1 to A5 entered into a criminal conspiracy during the period between September, 1993 to June, 1994 with an object of dishonestly or fraudulently obtaining undue pecuniary advantage in the matter of allotment of shops on economical licence fee basis in contravention of the rules governing such allotments and in pursuance to the said criminal conspiracy Smt.Sheila Kaul (A1) by abusing her official position as the Minister for Urban Development and in this capacity as the custodian of the government shops, without any public interest, sanctioned allotments of three shops on 09.04.94, without calling for any tenders or applications from the general public in Pleasure Garden Market (Opposite Red Fort) and Hanuman Road Market causing undue pecuniary advantage to Sh.L.Tsering (A3), Smt. Krishna (A4) and Smt. Tulsi Balodi (A5). In furtherance of the said conspiracy A1 and A2 the accused public servants committed the offences of criminal breach of trust with an RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 4 of 194 5 object of causing undue pecuniary advantage to their relations/friends (A3 to A5) and dishonestly or fraudulently allowed A3 to A5 to convert for their own use, without any public interest, the Government shops entrusted to the Ministry of Urban Development.
4. Investigations further revealed that as per para 2 (a) of the manual of office procedure prepared by the Directorate of Estates regarding licenses in respect of markets, all the vacancies arising in respect of shops/stalls were required to be filled up as a matter of rule by inviting open tenders from the public. A provision for reservation for 22.5% of the vacancies for Scheduled Castes was also made and applications were required to be invited from these communities in respect of reserved quota to whom allotments were to be made by draw of lots on payment of such economic licence fee as may be decided by the government. As per para2(b) of this manual all allotments were to be made on leave and licence basis and the allottees were required to pay full amount of security deposit equivalent to 6 month's licence fee and one month's advance licence fee, execute a licence deed and produce an affidavit giving the local as well as the permanent home address RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 5 of 194 6 st and a recent passport size photograph attested by a Magistrate 1 class/Gazetted Officer at the time of obtaining possession slip from the Directorate of Estates.
5. Investigations further revealed that in 1979, an office memorandum No.17017/4/77WZ, dated 24.03.79 was issued by the then Ministry of Works & Housing vide which policy to be adopted for development, construction and management of shopping centres in various government colonies in Delhi was circulated. As per para 2(i)(a) of this O.M., the construction of shopping centres was to be undertaken by the CPWD and thereafter the shops were to be sold by auction by the Land & Development Officer, after fixing minimum reserve price in consultation with the Finance Division. Para 3 of this O.M. further states that this would be the general policy to be adopted in future for the disposal of shops, exceptions may be made if the circumstances so warrant. There is no mention of any reservation of any kind in this O.M.
6. The manual of office procedure regarding management of Central Govt. markets in Dehli/N.Delhi was again revised upto 1.2.92 by the Directorate of Estates. As per para 3(a)(i), all vacancies were required to be filled, as a rule, by inviting tenders RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 6 of 194 7 from the public. Similar provision for reservation of 22.5% of the vacancies for Scheduled Caste candidates which was existing in the earlier manual of 1974 was also incorporated. Para 12 of this manual mentions that the Govt. may, for reasons to be recorded in writing, relax all or any of the provisions of the rules/instructions governing the policy of allotment of shops etc.
7. Investigations further revealed that in pursuance to the said criminal conspiracy Sh.P.K.Thungon (A2) dishonestly initiated a note on 06.12.93 mentioning therein that shops/stalls have not been allotted to SC/ST candidates at all, although there is 22.5% reservation for SC/ST candidates in such matters. He further mentioned that he has received some applications from SC/ST candidates namely Sh.Kessang Tsering and Sh. L.Tsering (A3). He recommended that shop no.12 and 13 which were reported to be lying vacant in Lajpat Rai market may be allotted to Sh.Kessang Tsering and Sh.L.Tsering (A3) respectively. He further stated that shop nos. 85, 325 and 405 in New Lajpat Rai Market were also reported to be lying vacant and there was another case of Ms. Krishna (A4) w/o Late Sh.Krishan, who was a widow and had two RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 7 of 194 8 school going children, was also pending with the Department and on extreme compassionate ground her case for allotment of either of the shop in New Lajpat Rai Market should also be considered. Smt.Sheila Kaul (A1) ordered on this note that there are some more VIP references pending and Director of Estates 1 may put up composite proposal at an early date. It was pointed out by DEI in his note dated 27.12.93 that any shop falling vacant in P.G.Market (New Lajpat Rai Market) can only be disposed of through an open auction/competitive tender. However, as desired by Smt.Sheila Kaul, he placed 22 other applications received in the office for consideration of the Urban Development Minister. Secretary (UD) Sh. K. Padmanabhaiah enquired from DEI, as to what was the policy regarding lease/sale and fixation of lease price/sale price for those shops and what was the policy relating to allotment and whether there was any waiting list or otherwise how is the candidate selected for allotment.
8. A detailed note mentioning policy of the Government was put up by Sh. Harcharanjit Singh, Director of Estates on 17.01.94 to Secretary (UD) who recommended that the persons who had applied for allotment of shop may participate in the auction, if they so desire. On this note which was put up on 18.01.94 by Secretary RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 8 of 194 9 (UD), Sh.P.K.Thungon (A2) again put up his note on 19.01.94 strongly recommending the cases of Sh.Kessag Tsering and Sh. L.Tsering (A3) suggesting therein that shop(s) no.85 and 405 in New Lajpat Rai Market may be alloted to them and a shop should also be allotted to Smt.Krishna by invoking provisions of Clause3 of the policy of 1979.
9. On this note, Smt.Sheila Kaul (A1) on 09.04.94 by over ruling the objections of the office and by abusing her official position as the Minister for Urban Development and as such custodian of the government property in the shape of shops, dishonestly or fraudulently ordered allotment of shop no.405 to Sh.L.Tsering (A3) and shop no.85 to Smt. Krishna (A4), with a view to cause undue pecuniary benefit to the allottees (A3 and A4), without any public interest and also to favour Sh.P.K.Thungon who was her Minister of State, without recording any reasons, whatsoever, for non consideration of the other 22 applications which were also put up by the office. Sh. L. Tsering (A3) is nephew of Sh.P.K.Thungon (A2) and Sh.P.K.Thungon intentionally concealed this fact in his recommendation. Smt. Krishna (A4) is the sisterinlaw of Sh.Karmbir Singh Mann a common friend of both the Ministers i.e. Smt. Sheila Kaul and Sh. P.K.Thungon. These allotments were RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 9 of 194 10 opposed by the office, but Sh. P.K.Thungon vide his note dated 16.05.94 mentioned that he has discussed this matter with Smt. Sheila Kaul and the allotment orders be issued the same day itself and the possession may be given after the licence fee was fixed. As such allotment orders were issued by the office on 16.05.94 itself charging economical licence fee of Rs. 298 for shop no.85 and Rs. 291 for shop no.405 per month. Had these shops been put to auction these would have fetched at least Rs. 10,000/ each per month as revenue for the Government which were allotted at a pittance by Smt. Sheila Kaul in criminal conspiracy with the allottees as well as Sh. P.K.Thungon.
10. When the orders sanctioning allotment of shop no.85 and 405 were received in the office, a note was recorded by Sh. P. Bhardwaj, Assistant Director (M) on 27.04.94 mentioning therein that shops in the rehabilitation market are required to be disposed off by L&DO by open public auction and not on leave and licence basis. He further, proposed that in the first instance views of Finance Division may be obtained. Dy. Director (M) Sh. G.B.Singh while concurring with the views of his AD further mentioned that it was for the first time that UDM had made allotment of shops in a rehabilitation market where Government had already conferred RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 10 of 194 11 ownership rights. He further stated that UDM had not indicated the rate of licence fee on which the said 2 shops were to be allotted. He also gave details of 4 shops which were allotted in the last few years on tender basis. The shop in Ring Road Market fetched a monthly rent of Rs.4,005/ in 1994 and in Andrews Ganj Market it fetched a rent of Rs.2700/ during the same year. A shop in Sector 8, R.K.Puram was allotted @ Rs.4,672/ per month in 1987. He further pointed out that as per existing policy, those shops had to be disposed of through public auction and any allotment of those shops to a person without calling tender(s) would be a departure form the general policy involving financial implications and loss of revenue and hence concurrence of Finance Division would be necessary before implementation of the orders of UDM for the allotment of the said 2 shops. Sh. S.Pattanayak, Director of EstatesII concurred with DD (M) and marked the file to finance division for comments.
11. In the Finance Division case was examined by Sh.V.P.Sharma, Desk Officer on 06.05.94 and he pointed out that both the shops were located in the P.G.Market which is situated just opposite to the Red Fort at the heart of Delhi which is a hub of commercial activity. He further mentioned that the reasons mentioned by the Hon'ble Minister for allotting those shops may RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 11 of 194 12 appear to be genuine, yet while helping individuals the interest of the Government should also be kept in view and if the 2 individuals to whom the said 2 shops have been allotted, are to be helped, they should be allotted shops in any of the other markets because these 2 shops in P.G.Markets could fetch quite a sizeable revenue for the Government, if put on tender. The file was routed through Smt. Neena Garg, Director (F), Sh.Girish Bhandari, Joint Secretary & Financial Advisor and Sh. N.P.Singh, Addl. Secretary. All these officers were basically opposed to allotment of these shops in this fashion. The file was again received by Sh. P.K. Thungon, MOS who recorded his note on 12.05.94 mentioning therein that 2 shops in question be allotted on regular basis on payment of licence fee to the said allottees. He further discussed this matter with Smt. Sheila Kaul and recorded his note on 16.05.94 after which he ordered that allotment orders be issued on the same day although the possession could be given after the licence fee was fixed. The concerned Executive Engineer of CPWD was also influenced to furnish the economic licence fee at the earliest.
12. Investigations further revealed that a photocopy of request addressed to Urban Development Minister was received in the office of Director of Estates on 29.03.94 for allotment of shop no.
RC NO. 48(A)/1996
CBI vs. Sheila Kaul & ors. 12 of 194
13
2, Hanuman Road Market to Mrs. Tulsi Balodi (A5). Her husband Sh. P.B.Balodi was working as Attendant in Prime Minister's office. There is no other record to show as to how this application reached in the office of Director of Estates. But, it was processed at a lightening speed on 30.03.94 by Sh. S.Pattanayak, DEII himself and on that very day, it was recommended by Sh. Haracharanjit Singh, DEI and the Secretary (UD) for approval of allotment. Smt.Sheila Kaul (A1) dishonestly as well as by abuse of her official position approved the proposal on 09.04.94 without any public interest with an object of causing undue pecuniary advantage to Sm.Tulsi Balodi in pursuance of the said criminal conspiracy. Smt. Sheila Kaul (A1) confirmed vide order dated 23.07.94 that the allotment has been made on economical licence fee basis. Offer of allotment was issued on 31.5.94 and necessary documents were submitted on 06.06.94 by Smt.Tulsi Balodi and the occupation slip was issued on the same day. She took possession of the shop on 07.06.94.
13. All the aforesaid three allotments effected on 09.04.94 by Smt. Sheila Kaul were not covered under the policy of 1979 and were totally arbitrary. These allotments were made to favour nephew of her MOS Sh. P.K. Thungon, a close acquaintance and RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 13 of 194 14 CPWD contractor Sh.Karambir Singh Mann whose sisterinlaw Smt. Krishna is one of the allottees and personal attendant of the then P.M Sh. P.V.Narsimha Rao resulting into a huge loss of revenue to the Government and corresponding gain to the allottees. The aforesaid acts of allotments amount to obtaining valuable thing or pecuniary advantage without any public interest in pursuance to the criminal conspiracy and abuse of position and further to misappropriate government property which was entrusted to Smt.Sheila Kaul being the Minister incharge of Urban Development Ministry of Government of India.
14. Investigations further revealed that tenders were invited from the public for the allotment of various shops pursuant to the orders of the Hon'ble Supreme Court and these tenders were opened on 24.02.1997 and the highest rate quoted for shop number 2 Hanuman Road Market was Rs.9200/ per month as against economic licence fee of about Rs.576/ p.m. charged from the allottee of the shop in question, which clearly shows that huge undue pecuniary favour was shown to the accused allottees resulting in a corresponding wrongful loss to the public exchequer.
15. There was no public notice or advertisement inviting RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 14 of 194 15 applications from eligible persons and the allottees from whom applications were received belonged to a very limited circle centering around Smt. Sheila Kaul and Sh. P.K.Thungon or VVIP. These applications were received directly in the office of the Minister and there was no verification of antecedents of the applicants and the claims made by them in their application. Such allotments were made in pursuance of criminal conspiracy and by abuse of position therefore no verification was made. Smt. Sheila Kaul (A1) ordered allotments of shop no.85 and shop no.405 in P.G.Market without the applications being processed by the office by following the normal office procedure and allotments were ordered without verifying the eligibility of the applicants. None of the allottees was entitled to allotment of shops on economical licence fee basis in this fashion and they knowingly obtained undue pecuniary advantage in conspiracy with Smt. Sheila Kaul and Sh. P.K.Thungon.
16. By the aforesaid acts the accused public servants abused their official position and caused undue pecuniary advantage in pursuance of the said criminal conspiracy to A3 to A5 and such acts were without any public interest. Thus by the aforesaid acts Smt. Sheila Kaul (A1), Sh. P.K.Thungon (A2) and the three allottees namely Sh. L. Tsering (A3), Smt. Krishna (A4) RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 15 of 194 16 and Smt. Tulsi Balodi (A5) committed offences punishable u/S 120 B r/w 409 IPC and Section 13 (2) r/w Section 13(1)(d) and 13(1)(c) of the Prevention of Corruption Act, 1988. Smt. Sheila Kaul (A1) also committed substantive offences u/S 409 IPC and 13(2) r/w Section 13(1)(d) & 13(1)(c) of PC Act 1988.
17. Smt. Sheila Kaul (A1) and Sh. P.K.Thungon (A2) were no more public servants. However, sanction u/S 197 Cr.P.C for their prosecution had been obtained from the competent authority.
18. After filing of the chargesheet, the accused persons were summoned for the offence(s) punishable u/S 120B IPC r/w Section 409 IPC r/w Sec.13(2) r/w Sec.13(1)(d) and 13(1)(c) of the PC Act, 1988 and accused Smt.Sheila Kaul was also summoned in addition for substantive offence(s) u/S 409 IPC and Sec.13(2) r/w Sec.13(1)
(c) of the PC Act.
19. After summoning, the requisite documents were supplied to the accused persons. Vide detailed order dated 27.03.09 on the point of charge, it was found there was sufficient material on the record for the commission of offence punishable under Section 120 B r/w Sec.409 IPC and 13(2) r/w Sec.13(1)(c) and 13(1)(d) of PC Act against A1 to A5. Besides that there was found sufficient RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 16 of 194 17 material to frame charge(s) for substantive offence(s) punishable u/S 409 IPC and Sec.13(2) r/w Sec.13(1)(c) and 13(1)(d) r/w Sec. 120B IPC against A1. Consequent thereto, formal charge(s) was framed against all the accused persons to which all of them pleaded not guilty and claimed trial.
20. It would be pertinent to mention herein that during the trial, A5 Smt.Tulsi Balodi expired and proceedings against her stood abated vide order dated 21.08.14, similarly A1 Smt.Sheila Kaul also expired and proceedings against her also stood abated vide order dated 12.08.15.
21. Prosecution in support of its case has examined 35 witnesses.
22. PW1 is Sh.Rajeev Nayan Sharma, Dy. Director, Ministry of Finance, New Delhi. He is a formal witness who has stated that in the year 1998 he was posted as Accounts Officer in Land & Development Office (L&DO) , Nirman Bhawan, New Delhi under the Ministry of Urban Affairs (hereinafter referred to as UD) and on the instructions of his officer, he delivered the file no.J.13011/5/91LD of Lands Division of UD Ministry in the office of CBI to Mr.P.C.Sharma vide memo Ex.PW1/1.
RC NO. 48(A)/1996
CBI vs. Sheila Kaul & ors. 17 of 194
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23. PW2 is Sh.Trilok Chand, Stenographer, P.A to MOS Agriculture, Krishi Bhawan, New Delhi. He stated that in the year 1994 he was posted as LDC in MarketI Section, he was dealing with Sector1 to 5, R.K.Puram Market and Janpat Market, at the instance of his boss Asst. Director P.Bhardwaj, he filled up few authority slips for taking possession, he identified the possession slips no.049522 and 049523 in the book no.976 stating that the said counterfoils are in his handwriting and they bear signatures of Mr.P.Bhardwaj. The slips are Ex.PW2/1 and Ex.PW2/2. He also after seeing the counterfoil number 049521/976 stated that the same was in the handwriting of Ram Chander, whose handwriting he was familiar with and also bears signatures of Mr.P.Bhardwaj, same is Ex.PW2/3.
24. PW3 is Sh.Ram Chandra, who was working in the year 1993 as Assistant in the Ministry of UD and thereafter, posted to Directorate of Estates in Admn. A Section and was transferred thereafter to Market1 Section in October 1993. He stated that he had seen the seizure memo D95 in the chargesheet, same bears his signatures, vide this memo he had produced 44 counter slips of the authority slips to the CBI. The copy of the said memo D16 is RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 18 of 194 19 Ex.PW3/A, bearing his signatures. The counter slips were handed over by him, also included three counter slips D17 which are Ex.PW2/1 to Ex.PW2/3.The counter slips Ex.PW2/3 was in his handwriting and that of Ex.PW2/2 bears his signatures.
25. PW4 is Mr.M.N.Mandal, who was working with the L&DO at the relevant time. He after seeing the original memo D55 which is lying in chargesheet no.3 in RC 48(A)/96DLI stated that the same bears his signatures and is Ex.PW4/A. Vide this seizure memo he handed over the files mentioned therein pertaining to L & DO department.
26. PW5 is Mr.Jaidev Singh, another formal witness. He stated that in 1994, he was working as UDC in Income tax department. After seeing the indemnity bond he stated that the same bears his signatures at point A, which is Ex.PW5/A, whereupon he has signed as a witness. The said indemnity bond pertains to accused A4.
27. PW6 is R.D.Sahay, he deposed that from 1989 to December 2000 he remained posted in the Ministry of UD, Directorate of Estate. After seeing the handing over memo D6 in chargesheet no.3 he stated that vide this memo he handed over 52 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 19 of 194 20 files, the details of which are also mentioned therein, which also bears his signatures, same is Ex.PW6/A.
28. PW7 is Sh.Pradeep Chand Phuloria. He has deposed that he was working at the relevant time in CPWD. He did not prove any document, only deposed that he was residing at the address G268, Naroji Nagar, New Delhi and that one Rajesh Kumar never resided with him, though the licence fee Ex.PW8/A contains his address mentioned above and the said Rajesh never resided with him at the said address.
29. PW8 is Sh.Inder Kumar. He has deposed that accused Smt.Krishna (A4) is the wife of his brother Late Sh.Kishan Maan. After seeing the licence deed in file D2 he stated that the same at page no.22 to 26 bears his signatures at point C and is Ex.PW8/C and he has put his signatures thereon at the instance of his elder brother Karamvir Maan. After seeing the photographs at S.No.13 and 14 on the said documents, he stated that the same are of (A4) Smt.Krishna. He was also declared hostile on certain points by the Ld.SPl.PP for CBI, but despite that he did not support the case of prosecution, as earlier recorded in his statement u/S 161 Cr.P.C.
RC NO. 48(A)/1996
CBI vs. Sheila Kaul & ors. 20 of 194
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30. PW9 is Sh.Ashok Kapur. He was working as Private
Secretary to A2 P.K.Thungon, MOS (UD), Government of India. He after seeing the file D4 which contains the notings dated 06.12.93 at page no.16, 19.01.94 at page 24, 12.5.94 at page 33 and 16.5.94 at page 33, stated same bears the signatures of A2 then MOS at point A, which are Ex.PW9/A to Ex.PW9/D. The photocopies of said notings are also kept in file no.D1, D2, D3.
31. He further deposed after seeing the file D1 which contains the photocopies of his notings and impression of his signatures that the same bears seal in original of Director of Estates and endorsement of DEI and DEII in original. The original of the noting is in file D2 at page 6 which is Ex.PW9/E, which bears his signatures at point A. The photocopies of the said notings is kept in file D1 at page 8, as per the notings, it is mentioned allotment for shop no.85 and 405, P.G.Market have been allotted in the name of Smt.Krishna and L.Tsering. It is also mentioned in the said decision that the rent of the shops would be fixed within fortnight, further it has been mentioned that MOS (UD) had desired the stipulated date be adhered to and rent be fixed within 2 weeks.
32. PW10 is Sh.K.Dharmarajan, who during the relevant RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 21 of 194 22 period was posted as Joint Secretary in the Ministry of UD. After seeing file D5 (original in chargesheet no.III as D2), he stated that he dealt with the said file in respect of management and disposal of shops in seven markets, shopping centers constructed by CPWD in Central Government Colonies. The issue in this file related to fixing of reserve price for these shops that were required to be disposed off by auction as per the policy in existence. File D5 contains his note dated 03.02.94 at page no.122 (original in chargesheet no.III as D2). The same is Ex.PW10/A. The file also contains his note dated 15.02.94 at page 123 to 126,(original in chargesheet no.III as D2), same is Ex.PW10/B.
33. He after seeing the file D11 (original in chargesheet no.III as D84), stated that he dealt with the said file in respect of management and allotment of shops in the markets, which were constructed by CPWD in Central Government Colonies. It also deals with respect to certain allotments made by then Union Minister to place shops at the disposal of Directorate of Estates for allotment of shops to persons on a predetermined licence fee basis which at that time was against the policy guidelines of the government. File D11 contains his note dated 01.05.92 at page no.10 to 14(original in chargesheet no.III as D84) the same is Ex.PW10/C. The file also RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 22 of 194 23 contains his note dated 01.06.92 at page no.14 and 15, the same is Ex.PW10/D, the file also contains his note dated 09.10.92 at page 19 (original in chargesheet no.III as D84), same is Ex.PW10/E.
34. He further deposed that a letter dated 18.05.94 at page 45 of the above file was written by him to Mr.Balachander the then Private Secretary to Minister of Welfare in response to his letter dated 25.04.92 informing him regarding allotment of shops in Lodhi Road complex under the control of L&DO had to be disposed off only by public auction and that allotment of shops on rental basis or on premium at predetermined rates was not within the purview of existing policy of government at that time, the office copy of said letter is Ex.PW10/F. He was also asked to explain the policy prevailing in the year 19931994 for allotment of shops, to which he deposed that the government policy at that time for the allotment of shops under the control of L&DO in various markets in government residential colonies was that they were to be disposed off on auction basis. For this purpose, a reserve price would be fixed. There was no policy at that time for making allotments in individual either on licence basis or on premium on pre determined prices.
RC NO. 48(A)/1996
CBI vs. Sheila Kaul & ors. 23 of 194
24
35. PW11 is Mr.G.V.Krishna Rau. He has deposed that at the relevant period he was on deputation to the Government of India, Ministry of UD. For about 2½ years he was working as Land and Development Officer and thereafter as Dy. Secretary, Lands and Water Supply in the Ministry. He after seeing the file D11(original in chargesheet no.III as D84) stated that it contains his note dated 20.04.92 which was submitted by him as Land and Development Officer and marked to Dy. Secretary (Lands), which relates to the disposal of shops, stalls, etc. constructed in government colonies by the L&DO, explaining the background and the reasons for non disposal of these shops and stalls and need for revision of reserve price and requesting the Ministry to take a clear cut policy view regarding disposal of these shops and stalls. The note is Ex.PW11/A (D11).
36. He after seeing the file D4 stated that same contains note dated 31.12.93 at page 19 and 20 on the noting side, he dealt with this file as Dy. Secretary, Land and Water Supply, the same note was accorded by him, he marked it to Directorate of Estates, the said note is Ex.PW11/B (D4), which bears his signatures, he submitted this note in response to the query raised by then RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 24 of 194 25 Secretary, UD who wanted to know, what was the policy regarding lease/sale and fixing of lease price / sale price for these shops , in this note he explained the basis of disposal of shops, stalls in govt. colonies by the L&DO only through public auction in terms of the policy laid down in OM dated 24.3.79 and the efforts made to dispose off these shops and the exploration of possibilities for transferring these shops of the local bodies as reserve price.
37. He after seeing the note 03.12.93 at page 113 on file D5 (D2 in charge sheet no.3) the said note is Ex.PW11/E bearing his signatures the same pertains to issue of disposal of shops and refixation of reserve price. He also after seeing the note dated 16.12.93 at page 116 on file D5 (D2 in chargesheet no.3) which is Ex.PW11/F bearing his signatures the same pertains to issue of disposal of shops and refixation of reserve price.
38. He after seeing another note dated 11.01.94 at page 117 to page 122 on file D5(D2 in chargesheet no.3), the said note is Ex.PW11/G bearing his signatures. It is a self contained note desired by the Joint Secretary and this also relates to the same issue of disposal of shops and refixation of the reserve price as well as the alternate of refixing the reserve price etc. the status relating RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 25 of 194 26 to shop no.85 P.G.Market, related to refixation of price was also explained and the file was referred back to Directorate of Estates. The office memorandum is Ex.PW11/C.
39. He was also shown file D5 (D2 in chargesheet no.3) which contains the copy of his earlier note dated 20.4.92 at page 106 to 108 same is Ex.PW11/A1 he was also shown note dated 05.5.93 at page 109 on file D5 (D2 in chargesheet no.3) the note is Ex.PW11/D bearing his signatures. It also relates to the same issue of disposal of shops and refixation of reserve price. He was also shown note dated 08.04.94 at page 129 to 130 on file D5 (D2 in chargesheet no.3) the said note is Ex.PW11/H bearing his signatures. He was also shown note dated 06.09.93 in file D4 which was regarding the revision of reserve price which was under
consideration and he submitted the file to Joint Secretary, UD stating that MOS (UD) wanted to know the position immediately with regard to the fixation of revised reserve price. The said note is Ex.PW11/J, which bears his signatures at point A.
40. PW12 is Sh.Desh Pal Singh.He has deposed that during the relevant time i.e. in June 1994 he was posted in Planning Commission, NIC Division, looking after the computer maintenance RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 26 of 194 27 of the adjoining buildings i.e. Dak Bhawan, Sanchar Bhawan, Shram Shakti Bhawan, he was maintaining the computers of office and residence of Ministers and Member of Parliaments. After being shown licence deed contained in file D1 from pages 24 to 29 he stated that the same pertains to L.Tsering who is the son of brother in law (i.e. brother of wife of Mr.P.K.Thungon) of the accused P.K.Thungon, the license deed is Ex.PW12/A bearing his signatures at point A. and that of L.Tsering at point B. He also deposed that L.Tsering used to meet him in the office of Ministry of Water Resources. He also told him that he used to reside with Mr.P.K.Thungon.
41. PW13 is Sh.S.P.Singh. He stated that in June 1994 he was posted in DGW, CPWD, Nirman Bhawan He was shown licence deed contained in file D3 at page no.14 to 19 which relates to allotment of shop no.2 Hanuman Road Market to the accused Tulsi Balodi A5. He knew her through one of his friends and he signed on the request of his friend Sh.S.K.Sharma and the licence deed is Ex.PW13/A.
42. PW14 is Sh.Sunil Kumar Sharma, another fomal witness. He also deposed that in year 1994 he was owrking as LDC RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 27 of 194 28 in DGW, CPWD , Nirman Bhawan, New Delhi at that point of time he was residing in Minto Road, New Delhi and P.B.Balodi was also residing in the same locality. After seeing the licence deed Ex.PW13/A )(D3) paged no.14 to 19, he stated that the same pertains to allotment of shop no.2, Hanuman Road Market to the acused Krishna Balodi w/o P.B.Balodi and on the request of Mr.Balodi he put his signatures on licnece deed Ex.PW13/ A and the indemnity bond pertaining to her also bears her signatures at point A which is Ex.PW14/A.
43. PW15 is Mr.V.P.Sharma. He deposed that at the relevant time he was posted as Desk Officer in the Finance Division of Ministry of UD . After seeing the file D4, relating to allotment of shops he stated that the said file was marked to him for examination and scrutiny from financial angle, after examination of the same, he submitted a note dated 05.05.94 detailing his views, same is Ex.PW15/A, which bears his signatures at point A. File D4 also contains a note of then Dy. Director G.B.Singh, he identified his signatures at point A, as he had seen him writing and signing. The said note is Ex.PW15/B.
44. PW16 is Mr.Prem Ballabh Balodi, husband of A5. He RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 28 of 194 29 deposed that in the year 1991 he joined the personal staff of the then Prime Minister of India. Accused Tulsi Balodi is his wife, who was alloted a shop at Hanuman Road, Delhi. At that time she was working as a labourer in a private company. After receiving the allotment letter, he accompanied his wife to the Directorate of Estates for submitting the requisite documents.
45. He after seeing the copy of application for allotment of shop stated that same is photocopy of the application submitted by his wife, which bears her signatures at point A, the copy of said application is Mark PW16/X. The file D3 also contains the photographs of his wife at S.No.C9 and C10 which are Ex.PW16/A1 and A2. The indemnity bond is already Ex.PW14/A, bearing her signatures at point B1 and B2, undertaking at page 30 is Ex.PW16/B bearing her signatures at point A. Licence deed at page 14 to 19 is already Ex.PW13/A, bearing her signatures on all pages. He knew Sh.S.K.Sharma, who was his neighbourer, and their children used to study together. The affidavits at page 20 and 21 also bears signatures of his wife at point A, same is Ex.PW16/C1 and C2. Occupation slip also bears signatures of his wife at point A, same is Ex.PW16/D. The forwarding letter vide which these documents were submitted to the Directorate of Estates RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 29 of 194 30 also bears signatures of his wife, same is Ex.PW16/E.
46. PW17 is R.K.Khandekar. He has deposed that in the year 1994, he was posted as OSD to the Prime Minister of India and after seeing the file D3 relating to allotment of shop to Smt.Tulsi Balodi, which contains 2 photographs already Ex.PW16/A1 and A2, he stated that he has attested the said two photographs.
47. PW18 is Sh.Sushil Kumar Satrawala. He has deposed that in the year 1991 he was on deputation to the Ministry of Heavy Industry, Govt. of India and remained posted in the office of Minister of State, Heavy Industries, Mr.P.K.Thungon till January 1993.
Thereafter, Mr.P.K.Thungon took over the charge of MOS, UD and he took him alongwith him to the said Ministry. In March 1993, Mr.P.K.Thungon was given additional charge of Minister of State for Water Resources and he was also working there with him. Lakhpa Tsering is the relative of Mr.P.K.Thungon and after seeing the file D1, he identified two photographs of Lakhpa Tsering. The said photographs are Ex.PW18/A1 and A2.
48. PW19 is Sh.Sardar Singh. He deposed that he was posted at the relevant time as Executive Engineer (Licence fee) in the office of Chief Engineer, ZoneI, CPWD, New Delhi, his duties RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 30 of 194 31 were to calculate economic licence fee for the government properties and private properties taken on hire by government departments. The properties may include shops and stalls located in the market , the usual practice for revising or renewing the economic licence fees for shops was for the period of 3 years, in case of Ministries, it can be of 5 years or it can be earlier depending upon land rates. The basis of calculating licence fee is, cost of land at the prevailing rate during the period and the cost of structure/building of a particular land and the land rates are usually referred by L&DO. They were the authority to fix the land rates and the cost of building decided on the schedule of rates of CPWD during the period. They work out total cost and some percentage is taken for calculation.
49. After seeing the file no.L&DO/PSIV/PolicyII/83 (PartI) (D4) and also page no.31/C, he stated that it was received in their office which is already Ex.PW26/D, the same was from Directorate of Estates on the subject of licence fee in respect of shop no.85 and 405, Pleasure Garden Market, requesting for licence fee in respect of the above mentioned shops and to intimate the sender immediately, in response to the said letter, he had sent a compliance note which was at page 32 of the file, bearing his RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 31 of 194 32 signatures, same is Ex.PW19/A. Alongwith the said letter, he had enclosed two enclosures, one of the same is on the record, which is at page 33, bearing his signatures which is Ex.PW19/B. He also deposed, as per annexures, the licence fee was calculated in respect of shop no.85 as Rs.298/ per month w.e.f 01.04.93, similarly for shop no.405 it was Rs.291/ w.e.f 01.04.93.
50. PW20 is Sh.G.C.Bhandari, who has deposed that at the relevant time in the year 1994, he was working as Joint Secretary and Financial Advisor in the Ministry of UD, on deputation from his parent cadre Ministry of Defence, Department of Defence Account. His duties were to make budget for the Ministry , give financial advise on policy matters.
51. He deposed that one file no.L&DO/PSIV/PolicyII/83 (D4) had come to him with noting dated 05.05.94 already Ex.PW15/A made by Mr.V.P.Sharma, who was Dy. Director, who had marked the said file on 05.05.94 to Director (Finance) and in turn on 06.05.94 Director (Finance) marked the file to him i.e. JS (Finance), his noting dated 09.05.94 bears his signatures at point A, which is already Ex.PW15/DA. He had recorded his noting regarding disposal of government shops and he suggested that a reasonable RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 32 of 194 33 method for disposal of government shops be evolved, unless such a policy is evolved if at all, all shops have to be given on licence fee basis for a period of 23 years. He also referred to the notings of then MOS dated 19.01.94, which is Ex.PW9/B.
52. PW21 is Mr.K.D.Singh. He has deposed that he joined Directorate of Estates in 1989 and remained posted there till 2006 in various Sections like Marketing, Vigilance, General, Quarter Allotment TypeIII Section. After seeing the attested photocopy of seizure memo (D14) (original kept in CC No.15/11 chargesheet no. 3 as document D61), he stated that the same was bearing his signatures, vide which he handed over certain documents as mentioned in the said seizure memo which is Ex.PW21/A. He further deposed that he handed over on 10.03.97 photocopy of attested copies of comparative statement (D9) in respect of tenders called for various shops / stalls of the Directorate of Estates which was opened on 24.02.97. They contain the impression of his signatures at point A in respect of attesting the same. Copy of the same duly attested by him has been kept in CC No.15/11 chargesheet no.3, same is mark PW21/1.
53. He further deposed that after the directions of Hon'ble RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 33 of 194 34 Supreme Court, they had called the tenders for various shops / stalls and rates would have been quoted therein, on this basis comparative statements were prepared by the Directorate of Estates.
54. He also deposed that he handed over the photocopy of Manual of Office Procedure regarding licenses in respect of markets, office memorandum no.17017/4/77W2 dated 24.3.79 and also the Manual of Office Procedure regarding management of Central Government Market in Delhi/New Delhi revised upto 01.02.92 of Directorate of Estates which are on record as D6 to D8. He had also attested these documents and handed over the same to IO which was kept in CC No.15/11 chargesheet no.3, bearing his official stamp and signatures. Same are Ex.PW21/B1 and B2.
55. PW22 is Harcharanjit Singh. He deposed that he remained posted as Director of Estates from 1991 to April 1997. At that time Sh.S.Patnayak was Director of EstatesII, Smt.Sheila Kaul was the Minister of UD, Sh. P.K.Thungon was posted as MOS. After seeing the document D6 Ex.PW21/B1, Ex.PW21/B2 (D8) and Ex.PW11/C (D7), he stated that these allotments pertain to the RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 34 of 194 35 period when he was Director of Estates, Nirman Bhawan, New Delhi. There were some shops in various government colonies, which were lying vacant and had not been disposed off despite efforts by the government by calling tenders, thereafter reducing the reserve price by 50%, during this period, the then UD Minister proposed that these shops may be given on economic licence basis, allotment of shops on economic licence fee was a normal method of allotment prior to 1994, even the rules notified in 1992 gave power to the Minister to relax the rules and to make allotments.
56. He further deposed that there was some orders in the year 1979, under which the allotment of shops were to be made only on economic licence fee basis, thereafter in year 1992, rules were modified to bring in a provision for disposing the shops by calling tenders, but the tendering process was not successful, as the reserve price was very high. He further deposed that normally, the Minister should record the reasons for relaxing the rules, but no specific reason was mentioned in the rules.
57. He was shown file D3 regarding allotment of shops at Hanuman Road Market in favour of Tulsi Balodi. He stated that he had handled this file, the file contains his notings on page 2 at point RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 35 of 194 36 C, which is Ex.PW22/A, bearing his signatures. He was also shown allotment file (D2) regarding allotment of shop no.85 at P.G.Market, near Chandni Chowk in favour of Smt.Krishna. He stated that he had also handled said file, his notings at page 18 bears his signatures, same is Ex.PW22/B and the file (D2) also contains his notings at page 19 and his signatures at point X(original of these documents are in file D4), the said noting is Ex.PW22/C. He also deposed that the file D2 also contains his notings on page 20 to 22 also having his signatures, same is Ex.PW22/D.
58. The witness was also shown file D1 regarding allotment of shop no.405 at P.G.Market, Delhi in favour of L.Tsering. He also deposed that he had dealt with this file and the file contains his notings, the original of these notings are already on record in file D4 and same is Ex.PW22/B to Ex.PW22/D. The witness after going through the file D4 identified his notings and signatures at page 18, 19, 20 to 22 which are already Ex.PW22/B to Ex.PW22/D.
59. PW23 is Sh.Ram Pal Joshi. He has deposed that he knew Mr.P.K.Thungon and he also knew father of Lakhpa Tsering, as also Lakhpa Tsering, who is son of P.K.Thungon's wife's brother. After seeing the file D1, pertaining to shop no.405, P.G.Market, he RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 36 of 194 37 stated that the said licence deed Ex.PW12/A bears his signatures at point C, the indemnity bond was also witnessed by him at point A, which is Ex.PW23/A.
60. PW24 is Mr.V.K.Malhotra. He deposed that in the year 1998 he was posted as Joint Secretary in the Ministry of Home Affairs, during said tenure his duties were to process the cases sent by CBI for sanction of prosecution. He proved the sanction order dated 23.04.98 u/S 197 Cr.P.C against Smt.Sheila Kaul and P.K.Thungon u/S 120B r/w Section 409 of IPC and Section 13(2) r/w Se.13(1)(c) and (d) of PC Act, which is Ex.PW24/A.
61. PW25 is O.P.Khanna. He has deposed that he remained OSD to MOS, UD Mr.P.K.Thungon in the year 199293. As OSD his duties were to attend phone calls, visitors, appointments and another jobs assigned by Minister. He had been shown the file D1 regarding the shop no.405, P.G.Market, relating to L.Tsering, which contains the notings dated 06.12.93 (already Ex.PW10/DA), 19.01.94 already Ex.PW10/DB, 12.05.94 and 16.05.94 (marked as Mark PW25/1 and 25/2). He was also shown the transfer certificate of L.Tsering issued by DPS, R.K.Puram, New Delhi, which he attested under his signatures and official stamp, same is RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 37 of 194 38 Ex.PW25/A.
62. PW26 is Sh.G.B.Singh. He has deposed that he was holding the charge of Dy. Director (Office & Market) from November 1993 till he left the Directorate of Estate in June, 1995 on promotion to Ministry of Home Affairs. He had been shown file D4 pertaining to L&DO/PSIV/PolicyII/83 (PartI), on seeing the noting dated 06.12.1993 at page no.16/N which was of P.K.Thungon as MOS (UD), he identified his signatures and deposed that vide the said note, P.K.Thungon had recommended for allotment of shops to Sh.Kessang Tsering, Sh.L.Tsering and Mrs. Krishna. The file was marked by P.K.Thungon to UD Minister, the then Smt.Sheila Kaul, who also put up note that there are some more VIP references pending, who then further marked the file to Director of EstateI, who further marked the file to him and he again marked the file to MarketI Section on 20.12.93.
63. He further deposed that AD Market of Market SectionI put up a note pertaining to as per the directions of then UDM indicating shops no. 85, 325 and 405 in Lajpat Rai Market and in para 4 of Section note, there is also a reference of policy of allotment of these shops on auction basis where ownership rights RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 38 of 194 39 have been granted. The file was then marked to him, he further endorsed the said note on 24.12.93 under his signatures and same is Ex. PW26/A.
64. He identified the signatures of DEI Sh. Harcharanjit Singh on the noting dated 27.12.93. He further deposed that he had received the file on 04.5.94 from the then AD (Market) upon which he recorded his noting dated 04.5.94 Ex. PW26/B (page 26/N) indicating the policy for allotment in the markets where ownership rights have already been granted by the government. He further deposed that since allotment of shops in these markets to any person was departure from general policy, he recommended that concurrence of the Finance Division may be obtained in the first instance before the matter is further processed.
65. He further deposed that he endorsed the note dated 30.5.94 Ex. PW26/C of the then AD (Market) Sh. P Bhardwaj and identified his signatures, who also mentioned that no decision had been taken regarding revised license fee w.e.f 01.4.91. He also made his noting Ex. PW26/D in File D4 at page 31, wherein he had asked the Executive Engineer (License Fee) CPWD to indicate the formula in respect of shop nos. 85 and 405, Pleasure Garden RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 39 of 194 40 Market, New Delhi.
66. He had been further shown notings dated 12.5.94 and 16.05.94 of the then MOS (UD) P.K.Thungon at point A which are already Ex.PW9/C and Ex.PW9/D. Vide these notings, he had sent a UO note Ex.PW26/D to CPWD on 16.05.94 as the MOS and UDM decided to allot the shop no.85 and 405 at Pleasure Garden Market, Delhi.
67. He had been further shown file Mark D2 pertaining to shop no.85, P.G.Market, Delhi allotted to Smt.Krishna which contained a licence deed for the aforesaid shop and the deed was executed and signed by him as Dy.Director of Estates and also bears his signatures. The deed is already Ex.PW8/A.
68. He had been further shown the allotment letter dated 03.6.94 Ex. PW26/E in respect of shop no.85, P.G.Market, Delhi allotted to Smt.Krishna and he identified his initials on the same. He had been further shown letter of allotment dated 03.6.94 Ex. PW26/F pertaining to shop no. 405, P.G Market relating to L.Tsering which bears his initials at point A. He had also seen licence deed already Ex.PW12/A which bears his signatures at point D on all five pages. He had been shown the indemnity bond already Ex.PW23/A RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 40 of 194 41 in respect of shop no.405, P.G.Market relating to Lakhpa Tsering. He identified his signatures at point B.
69. He had been further shown letter of allotment dated 31.5.94 Ex. PW26/G in respect of Smt. Tulsi Balodi which was issued under his initials . He had been also shown Licence Deed Ex. PW13/A in respect of Smt. Tulsi Balodi regarding allotment of shop no. 2, Hanuman Road, New Delhi which was executed and signed by him at point A. He had been also shown indemnity bond already Ex.PW14/A in respect of shop no.2, Hanuman Road in the name of Smt.Tulsi Balodi which bears his signatures at point C.
70. PW27 is Sh. Sansar Pattanayak. He has deposed that while working as Director of Estates (DEII) in the Directorate of Estates from 1993 to 1995, he was looking after the allotment of residential accommodation from TypeI to TypeIV, office accommodation and markets. He further deposed that there was no provision for relaxation in the license fee in the manual Ex. PW20/B1 and in the event of creation of vacancies in respect of shops and stalls, tenders used to be called.
71. After seeing office memorandum Ex. PW11/C dated 24.3.1979 regarding policy to be adopted for development and RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 41 of 194 42 construction of shopping centers in various Government colonies he stated that construction was to be undertaken by CPWD and there was a policy in existence according to which the shops were to be auctioned by L&DO and there was no provision for reservation in auction, there was a provision for fixing minimum reserve price for auction. He further deposed after seeing document (D8) which is a copy of Manual of Office Procedure regarding management of Central government markets in Delhi revised upto 01.02.1982 issued by Directorate of Estates(D8) is Mark PW25/A, as per same, the vacancies were to be filled as a rule, by inviting tenders from the public and it also provided for 22.5% reservation for SC/ST candidates.
72. After seeing his note dated 23.8.94 Ex. PW25/A under his signatures in file D5 at page N/138 and N/139 regarding the status of shops/stalls allotted or lying Vacant in Lodhi Road Complex (LRCI), BKS Marg and Hanuman Road, thereafter marked the file to DEI Sh. Harcharanjit Singh. He deposed that the rules were approved by A1 Smt. Shiela Kaul, then UDM on 26.12.94 and he had recorded a note Ex. PW25/B for obtaining legal advise on the issue of charging monthly rent as well as ground rent. Note Ex. PW9/A by A2 P.K Thungon was marked to UDM and finally RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 42 of 194 43 received in his office on 20.12.93 and the file came to him on 24.12 93, he had marked a portion of the note as 'X' as relevant on the noting dated 23.12.93 Ex. PW26/A put up by official of MarketI Section. His noting dated 24.12.93 is Ex. PW 25/C. Thereafter he further marked the file to DEI and the file again came back to him on 04.5.94 from Sh. G.B Singh, DD (O&M) on which he further made an endorsement Ex. PW27/D "for Concurrence/Comments" under his signature at point B and marked the file to DS(F)/Minister of UD.
73. He further deposed that Smt. Shiela Kaul vide noting Ex. PW27/E at page no. 24/N in File D5 under her signatures allotted shop no. 405 and 85 in P.G market to L.Tshering and Smt.Krishna. After noting Ex. PW9/C and Ex. PW9/D, the file came to him from Additional Secretary and draft allotment letter was put up in respect of L.Tshering and Smt.Krishna upon which he put up his note at place Mark X dated 16.5.94 Ex. PW27/F under his signatures. He also made a noting Ex. PW27/G under his signatures on 16.5.94 in relation to intimation of allotment and issuance of License deed and indemnity bonds along with letter intimating Licence fee.
74. He also made a noting Ex.PW10/DC and processed the application of Tulsi Balodi and a noting dated 30.3.94 was made in RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 43 of 194 44 respect of the said application, wherein he gave position of allotment of shops in three different markets including Hanuman Road and it was ascertained from L&DO that a proposal for auctioning vacant shops/stalls based on actual FAR had been prepared and was being put for approval of UDM, which proposal envisages dispensing with the system of economic license fee. The case was thereafter put up for consideration/orders and was marked to DE.
75. PW28 is Sh.K.Padmanabhaiyah. He has deposed that in 1993 he was posted as Secretary in the Ministry of UD. After seeing the file no.L&DO/PSIV/PolicyII/83 (PartI) (D4) he deposed that he had recorded a note dated 27.12.93 at page 19 of the notesheet portion, the said notings also bears his signatures, the same is Ex.PW28/A. His noting was due to visit of Director of Estates regarding policy/sale relating to allotment of shops or stall. After seeing his noting dated 18.1.94 at page 21 (wrongly typed, actually it is at page 23 in file D4) of the noting portion, he stated that same bears his signatures and is Ex.PW28/B. The purpose of noting was that the Minister of State had earlier remarked that there was no policy when he was asking for allotment to certain persons, so he wanted to check whether there was any policy for either leasing or selling shops, if so, how is lease amount fixed, how the RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 44 of 194 45 people are selected for allotment etc., he reviewed the note put up by the Director and gave his advise in the note of 18.01.94.
76. PW29 is Sh. Purshottam Bhardwaj. He has deposed that in the year 1994, he was posted as Assistant Director (Market I), in the Directorate of Estates. After seeing the file D4, he said that he had dealt with the said file during his tenure. After going through the file he stated that there was a note dated 27.04.94 at page 25 of the noting portion which is already Ex.PW15/B which he had put for fixation of license fee regarding shop nos.85 and 405, P.G.Market, in the name of Smt.Krishna and L.Tsering respectively, also bearing his signatures. He had marked the file to DD(M) for orders . The order of UDM is at page 24 of the above noting, at that time policy for allotment of shops in respective area was through public auction by calling tenders.
77. The said file again came to him on 23.05.94 through Directorate of Estates Sh.S.Patnaik for issuance of allotment letters for the above shops in the name of above persons. However, it was marked to DD(M), but he recorded a note which is at page 34 of the noting portion of the file bearing his signatures. The noting is Ex.PW29/A. Vide this noting, he had recorded that "letters have RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 45 of 194 46 been issued from respective files. We have also written to Executive Engineer (L.F.) to intimate the present L/F in respect of these shops." Thereafter, file was marked to dealing hand Sh.Ram Chander, after his noting the file was again put up before him on 30.05.94, wherein he made a note at page no.35 of the noting portion which is already Ex.PW26/C having signatures. He also recorded "no decision has yet been taken to intimate the revised licence fee w.e.f 01.04.91", thereafter he again submitted the file on 30.05.94 for orders of DD(M) with regard to the licence fee to be charged.
78. After seeing the file D1 pertaining to shop no.405 and allotment letter dated 03.06.94 in favour of L.Tsering, the same is Ex.PW26/F, on the said allotment letter he has also signed.
79. He was also shown the file D2 pertaining to shop no.85, P.G.Market and allotment letter dated 03.06.94 in the name of Smt.Krishna which is Ex.PW26/E, on the said allotment letter he had also signed. Further, after seeing the file D4 and page no.20 of the correspondence portion, as per the chart mark PW29/1 there were 22 VIP references for allotment of shops in different areas to different people.
RC NO. 48(A)/1996
CBI vs. Sheila Kaul & ors. 46 of 194
47
80. PW30 is Sh.P.C.Sharma, retired SSP, who had carried out the investigation of this case. He has deposed regarding the investigation carried out by him during the course of present case.
81. PW31 is Sh.D.K.Singh, he had assisted PW30 Sh.P.C.Sharma, who was the main IO of this case and he has proved one seizure memo Ex.PW34/A (D61) dated 22.10.96 having his signatures. He had also collected certain documents mentioned therein and also recorded statements of certain witnesses.
82. PW32 is Sh.N.P.Singh. He during the relevant period 19931996 was working as Addl.Secretary and then, thereafter Secretary, Ministry of Urban Affairs & Employment, Dept. Of Urban Development. As Addl.Secretary he used to deal with matters concerning Directorate of Estates, L&DO including matters relating to policy and coordination. He further deposed that during the relevant time 19941995 Minister's discretionary allotments for government quarters as well as shops were limited to 20% of the total number of cases in a year, however ceiling was never adhered to and Ministers were making allotments in most cases based on discretion. In this situation, it was open to the administration to take up the review of the policy once again and this came up only at the RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 47 of 194 48 time when the Hon'ble Supreme Court had taken cognizance of such issues. The suggestions made by him in various notes of his relating to the policy were against the above background and to minimize the loss to the government. The Ministers were exercising the discretion to reject or approve the applications for allotments including those of shops. At that time UDM was Smt.Sheila Kaul and MOS was Mr.P.K.Thungon.
83. PW33 is Sh.J.P.Singh. He was posted as Secretary to the Government of India in the year 1994 pertaining to Ministry of Urban Development and Housing. After seeing the pages 30,31 and 32 of file D4, he stated that at page 30, there is a note of N.P.Singh, then Addl.Secretary which he had approved as Secretary, Ministry of Urban Development. The said note is Ex.PW20/DA having his signatures.
84. PW34 is Sh.R.Vishwanathan. He has stated that during the relevant period, July 1992 to December 1992, he was dealing with the administrative matters pertaining to L&DO office and Lease Administration of the properties held by L&DO office. After seeing the file D11 pertaining to allotment of shops, he stated that this file was originally dealt with by Directorate of Estates. This file was RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 48 of 194 49 received by him because a decision was taken to transfer the subject matter of allotment of shops to L&DO office under the control of Land Division of Ministry of UD. He had received this file on 11.09.91. He made notings dated 11.09.91, 30.10.91, 14.01.92 and 17.01.92 on page 3 and 4, the said notings are collectively Ex.PW34/A, having his signatures (original notings are in RC 48(A)/1996, CC 15/2011 chargsheet no.III as D84).
85. After that he made a note regarding the disposal of shops with the L&DO office and need for review of policy taken in 1979 in view of the fact that the shops with L&DO continued to remain vacant for a long time, for this purpose a note for the cabinet was required to be submitted for decision, the above noting dated 06.03.92 at page 5 of file D11 was shown to the witness, which he identified having his signatures, the said noting is Ex.PW34/B.
86. After his noting, he marked this file to DS(L), who further marked this file to L&DO for comments. The comments of L&DO is already Ex.PW11/A. Thereafter, the file was forwarded to DS(L), who marked the file to JS(UD). He marked the file to Addl.Secretary (UD), who marked the file to Secretary (UD). Thereafter, the file was sent to the MOS for Urban Development and thereafter to the RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 49 of 194 50 Minister for Urban Development. The file was received by him through the same channel on 04.08.1992. He identified his signatures on notings at page 17 and 18 and the notings are Ex.PW34/C (colly.).
87. He further deposed that a policy decision was taken in 1979 to transfer the vacant shops in the government colonies to the L&DO for disposal through public auction. For the purpose of holding auctions, a minimum reserve price was to be fixed in consultation with the finance division of the Ministry. Accordingly, auctions were held on the basis of the reserve prices fixed in consultation with the finance division. The auctions were not successful, since there were no interested bidders. One of the reasons cited for disinterest of the bidders was the high reserve price. As there was no progress regarding disposal of shops for more than a decade, it was decided to transfer the shops to local bodies, i.e. DMC and NDMC. It was also decided that the transfer could be made in consideration of the cost of the land and construction of the shops. There was no positive response from local bodies also, as they felt that they could not afford to pay the cost of the shops. In these circumstances, the modalities for disposal of shops were required to be worked out and a policy RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 50 of 194 51 decision to do so was required to be taken at the highest level. It was proposed to approach the Cabinet with a note containing alternative feasible proposals for disposal of shops. For this purpose, L&DO was asked to submit the detailed comments, as inputs to the draft note for the Cabinet.
88. After seeing file D5, he stated that his noting is at page 112 which bears his signatures and said noting is Ex.PW34/D (original noting is in RC 48(A)/96, CC 15/2011, charge sheet no.III as D2). As per this noting, there were about 100 shops, 130 stalls and 23 open platforms, awaiting disposal, because of the vacancy of the shops, there was a proposal to refix the reserve price and different alternatives for fixation of reserve price were required to be examined in detail, based on the inputs from the L&DO. Thereafter, the file was marked to US(L1), then it was marked to JS(UD), as DS was on leave, who marked it to DS(L) after discussion. After a note of DS(L), he had again marked it to him.
89. After seeing file D5, he stated that page no.116 had his note which bears his signatures, the said noting is Ex.PW34/E. (original noting is in RC 48(A)/1996, CC 15/2011 chargsheet no.III as D2). Vide this noting, he had mentioned the details of reserve RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 51 of 194 52 price for different shops, based on three different options for fixation as suggested by L&DO.
90. He further deposed that thereafter, there were different representations by individuals, some of them were recommended by various VIPs. He made a noting on page 22 of file D11 which bears his signatures and said noting is Ex.PW34/F. (original noting is in RC 48(A)/1996, CC 15/2011 chargsheet no.III as D84). After this noting, he marked the file to Director (L) for sending it to the Minister through proper channel. He further proved his notings dated 03.08.93, 17.09.93, and 02.05.94 at page 23 to 25 as Ex.PW34/G (colly.) which bears his signatures.
91. After seeing file D11 he stated that his noting dated 06.09.94 at page 33 bears his signatures and said noting is Ex.PW34/H. (original noting is in RC 48(A)/1996, CC 15/2011 chargsheet no.III as D84).
92. PW35 is Narendra Nath Singh. He has deposed that in month of June, 1996 he was posted as Superintendent of Police, ACB, New Delhi and he had ordered for registration of FIR in this case. He had seen the copy of FIR which is already Ex.PW30/A bearing his signatures at point A. He also deposed that he recorded RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 52 of 194 53 statement of Sh.Girish Bhandari.
93. After the completion of prosecution evidence, statement of accused persons u/S 313 Cr.P.C were recorded separately, in which the entire incriminating evidence appearing against the accused persons was put to them. The defence of accused P.K.Thungon (A2) with regard to the incriminating evidence against him was as under It's a false case against me. There was no clear cut or cogent policy for disposal of vacant shops. The modalities for auction of shops had not been finalized. The shops could not be auctioned earlier on account of high reserve price. Even after reducing the reserve price by 50%, the shops could not be auctioned for want of bidders. Since the reserve price was not finalized as such the tenders could not be invited. The shops were thus lying vacant for a very long time calling for extensive repair and was causing loss of revenue to the Government. The reserve price for auction or inviting tenders had not been finalized till late 1995. One of the modes for allotment was by leave and License basis which was adopted by earlier Ministers also as there was a provision for making exceptions in the matter of allotment if the circumstances so warrant.
In the present case the allotments were
RC NO. 48(A)/1996
CBI vs. Sheila Kaul & ors. 53 of 194
54
made with the concurrence of the finance division and based upon the suggestions of Directorate of Estates. The allotments were made in view of very sound reasons.
At the time of allotment, the payment of economic license fee was being followed which proposal was approved by Sh. G.B Singh and Sh. S Patnayak.
There was a specific stipulation in the License deed that the allottees will pay the charges as may be decide by the Government from time to time with retrospective effect and the license could be revoked by the Government without assigning any reasons with a notice of 30 days. There was no pecuniary loss caused to the Government. This was to safe guard the interest of the Government and in view of the fact that the policy in this regard was not finalized.
I have not abused my official position or entered into any conspiracy with Smt. Shiela Kaul or the allottees for the allotment of shops to L Tsering who is a scheduled Tribe and Smt. Krishna who is a widow of a freedom fighter. The file of Smt. Tulsi Balodi never came to me. I am innocent.
94. Similarly, the defence of accused L.Tsering (A3) with regard to the incriminating evidence against him is as under I am innocent, I have been dragged in this case RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 54 of 194 55 for the last about 19 years and suffering mentally, morally, financially and I was driven back to my state and is now doing service under the private industry/shop and earning my livelihood and living hand to mouth and I have to look after my wife and two school going children. I am the only bread earner of my family and I have to come all the way from Arunachal Pradesh about 2000 K.M away from Delhi and being a tribal and ST and suffering for the last about 19 years. Atleast one week time is needed for coming to Delhi to attend this case and have to live without any employment and without any remuneration from my employer. Sometimes I have to borrow money from my parents/friends/relatives in order to look after myself and my family. I need sympathetic consideration of my case taking into consideration of my suffering and being a tribal(ST), I am leading such a miserable life RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 55 of 194 56 and I was only student when I applied having no means to look after myself financially. The application for allotment of shop was made through proper channel and as soon as I was asked to surrender the same I did so immediately and now I am living in my village and leading a miserable life. I have no place in Delhi to live to bear the expenses of this expensive city. I am living in some Dharamshala and any free lodging, boarding whichever is available. I did not conspire with anybody.
95. That of accused Smt. Krishna (A4) is as under I am innocent. I am a widow and a totally illiterate person. I can neither read nor write English or Hindi. After the death of my husband, Sh.Karamveer Singh Man who is the elder brother of my husband used to take care and look after my family. I have no means of livelihood. I have never met Mrs. Sheila Kaul. I do not know anything about this case. I have RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 56 of 194 57 been falsely implicated.
96. However, none of the accused persons chose to lead evidence in defence.
97. I have heard Ld.counsels for accused persons Sh.S.P.Minocha, Sh.Gurdial Singh and Sh. M.P.Singh and Ld.PP for CBI Sh.V.K.Ojha and Spl.PP for CBI Sh.J.S.Wadia and perused the record.
98. Prosecution has relied upon following judgments in support of its case
1. Vinayak Narayan Deosthali Vs Central Bureau of Investigation 2015 Cri.L.J.1554
2. Runu Ghosh Vs.CBI Crl.A.482/2002, P.Rama Rao Vs CBI Crl.A.509 and Crl.A.536/2002 Sukh Ram Vs CBI.
99. Ld. defence counsel for accused P.K.Thungon has firstly argued that the very sanction accorded in the present case u/S 197 Cr.P.C is defective, as firstly PW24 Mr.V.K.Malhotra was not competent to accord sanction and it is nowhere being revealed in his sanction order Ex.PW24/A that any material for according the sanction was produced before him on the basis of which the opinion for giving the sanction was arrived at. It is also argued that it is RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 57 of 194 58 contrary to the reason that the sanction of a Minister of State and that of Union Cabinet Minister has been accorded by an officer of rank of Joint Secretary, as nowhere in the sanction order it has been stated that the said Joint Secretary was giving the sanction on behalf of Government of India or the President under any delegated rules or legislation. Therefore, he has argued that the sanction order is invalid and accused P.K.Thungon (A2) is liable to be acquitted on the said ground alone, as the same goes to the root of the prosecution case.
100. He has further argued that there was no clear cut policy for disposal of vacant shops, the modalities for auction of shops had not been finalized. The shops could not be auctioned earlier on many occasions due to very high reserve price, even after the reduction of reserve price by 50%, the shops could not be auctioned for want of bidders, since the reserve price could not be finalized, therefore tenders could not be invited, even otherwise the shops in question were lying vacant for a long time, calling for extensive repairs which was rather causing great loss of revenue to the Government. The reserve price for auction or for tenders could not be finalized till late 1995. Further, one of the modes for allotment of shops was by lease and licence basis which was adopted by earlier RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 58 of 194 59 Ministers, as there was a provision for making exceptions in the allotments, if the circumstances so warranted. As per office memorandum of 1979, clause3 and clause12 of the Manual of Office Procedure regarding management of Central Government markets in Delhi / New Delhi revised upto February 1, 1992.
101. He further argued that in the present case, the allotments were made with the concurrence of Finance Division based on suggestions of Directorate of Estates. At the time of allotment, the method of payment of economic licence fee was followed, which proposal was approved by Sh.G.B.Singh and Sh.S.Patnayak, two of the prosecution witnesses examined in this case. He has further argued that there was a specific stipulation in the licence deed that the allottees will pay the charges as may be decided by the government from time to time with retrospective effect and the licence could be revoked by the government without assigning any reason with the notice of 30 days. Consequently, there was no pecuniary loss caused to the government, rather this was to safeguard the interest of the government and in view of the fact that the policy in this regard has not been finalized. Therefore, he argued that he has not abused his official position or entered into any conspiracy with (A1) Smt.Sheila Kaul (since deceased RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 59 of 194 60 proceedings abated) or any other allottees for the allotment of shops to accused L.Tsering (A3), who is a Scheduled Tribe and Smt.Krishna (A4), who is a widow of a freedom fighter. He stated that the file of (A5) Smt.Tulsi Balodi(since deceased proceedings abated) never came to him. He has, therefore argued that no offence u/S 13(1)(c) or (d) of the PC Act is made out against the accused P.K.Thungon (A2).
102. He has further argued that even no offence u/S 409 IPC is made out, as there was no entrustment of any property i.e. the shops to the accused P.K.Thungon nor he can be said to have dominion over the said shops nor it is the allegation of prosecution that he dishonestly misappropriated or converted the said property to his own use. He has further argued that no conspiracy is made out, as all the allottees were differently situated and no evidence has come on the record that there was any agreement amongst the allottees with (A2)P.K.Thungon for the allotment of shop(s) nor any meeting of mind in this regard, therefore he has argued that accused P.K.Thungon deserves to be acquitted on all counts.
103. Further, Ld. counsel for accused L.Tsering(A3) has argued that accused is a Schedule Tribe, coming from Arunanchal RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 60 of 194 61 Pradesh. He has been unnecessarily dragged into this case and when he had applied for the shop, he had no financial means to look after him. The application for allotment of shop was made through proper channel. As soon as he was directed to surrender the same, he did so immediately and there was no conspiracy whatsoever with anyone. Same is the argument of accused Smt.Krishna (A4), who has argued that she is a widow and a totally illiterate person, who can neither write nor read, after the death of her husband, Sh.Karamveer Singh Maan who is the elder brother of her husband, used to take care and look after her family, she had no means of livelihood, she never met (A1)Smt.Sheila Kaul (since deceased proceedings abated) and she has been falsely implicated.
104. On the other hand, Ld. Public Prosecutors for CBI have rebutted the abovesaid arguments of the defence and have argued that the sanction u/S 197 Cr.P.C was a legal and valid sanction. The same had been accorded by PW24 in the delegated capacity after going through the entire material placed before him. In any case, the said sanction had been granted by him by the order and in the name of Government of India in such delegated capacity and therefore, he was competent to accord sanction as well as the fact that there was sufficient material on the record to grant sanction RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 61 of 194 62 which had been accorded in accordance with law in view of the materials placed before the sanctioning authority. In any case, they have argued that no sanction even otherwise was required, as it is settled law that committing conspiracies or committing offence(s) is no part of duty of public servant regarding which there is umpteen number of judgments available.
105. They have further argued that it is admitted case that at the relevant time of allotment of shops, accused no.2 P.K.Thungon was Minister of State (UD), who had made a proposal for allotment of shops in favour of L.Tsering (A3), who is the son of his real brotherinlaw i.e. he is the son of real brother of his wife and another allotment was made in favour of accused Smt.Krishna (A4), who was the sisterinlaw of the common friend of the Minister of State i.e. Mr.P.K.Thungon (A2) and (A1) Smt.Sheila Kaul, UDM and the third allotment was made, though not on the proposal of A2, but was recommended directly by the Directorate of Estates and was approved by UDM was that of Smt.Tulsi Balodi (A5), whose husband PW16 P.B.Balodi was working at the relevant time in the personal staff of the then Prime Minister of India. He has argued that all the allotments were made flouting the norms of allotment prevalent at that time, which as per the office RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 62 of 194 63 memorandum of year 1979 was to be alloted by way of open public auction or by inviting tenders and allotments of shops no.405 and 85 in P.G.Market i.e. Lajpat Rai Market, which is situated opposite Red Fort near the commercial hub of Chandni Chowk was in clear violation of the notes made by the other Senior Officers of the Ministry, who had clearly opined that such a course was against the norms and the office memorandum in force and the said allotments should only be made by following the said norms, failing which the government will suffer substantial loss of revenue due to the strategic location of the said shops.
106. There was even proposal to allot these shops in other newly constructed Central Government Markets which were available, rather the said shops in said Central Government markets situated in government colonies were also allotted around the same time or few years back on tender basis. He has further argued that any departure from the established norms in terms of office memorandum of 1979 and the Manual of Office Procedure regarding licences in respect of the markets issued by Directorate of Estates had to be on the basis of reasonable classification and no reasons for exercising the discretion had been indicated in the notes of approval. It is also argued that it is settled law that the Courts can RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 63 of 194 64 examine the administrative discretion, if the same is totally arbitrary, unfair, unreasonable and is contrary to the Principles of Fairness under Article 14 of the Constitution of India.
107. They have also argued that the allotments in the present case were clearly flouting all the established norms and were marred by favouritism and nepotism, as there were many other persons similarly situated as A3 and A4 to whom the allotments were made without calling any tenders or following the established procedure of public auction, which would have fetched great amount of revenue for the government. Therefore, they have argued that A2, while holding the office of Minister of State had obtained pecuniary benefits for A3 and A4 in abuse of his such position and such act was without any public interest. They have further argued that prosecution had lead sufficient evidence on record to prove conspiracy between A1, A2, A3, A4 and A5, which is generally the inference to be drawn from the evidence adduced and no direct evidence is generally available. They have also argued that Section 409 IPC is also made out in the present case, as the shops were under the custody / entrustment of A1 and A2 or they can be said to have dominion over the said shops which they allotted in blatant violation of established norms by abusing the procedure i.e. the OM of 1979, RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 64 of 194 65 therefore they have argued that all the accused persons are liable to be convicted.
108. I have gone through the rival contentions and gone through the materials.
109. The origin of the present case emanates from the note on page 16 of file D4 Ex.PW9/A which is a note dated 06.12.93 by the Minister of State, UD, which was A2 Mr.P.K.Thungon at that time. The said note is as under RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 65 of 194 66
110. In the said note, A2 is himself writing that there has been a proposal that the shops should be disposed off by public auction. But the procedure of public auction could be adopted, if the activity of L&DO was a regular one and since, the shops were falling vacant occasionally due to cancellation etc., therefore it would be futile to go through the entire auction process. He also noted that no shop had been alloted to SC/ST candidates, though there was a reservation of 22.5% in such matters and some applications were received by him from SC/ST candidates pertaining to L.Tsering and Kessang Tsering and it was also found that 2 shops in Lajpat Rai Market were lying vacant i.e. bearing no.12 and 13 which may be alloted to them. Further, shop no.85, 325 and 405 were also lying vacant in the same market and there was another case of Smt.Krishna who was a widow having two school going children, having no means of livelihood and she may be alloted either of the above shops. On 08.12.1993 the matter was put up before then UDM Smt.Sheila Kaul, who stated that there were some more VIP references pending. DEI may put up (remaining portion not legible).
111. Thereafter, on page 17 on file D4, there is a note RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 66 of 194 67 dated 23.12.93 by MarketI Section by Sh.Vijay Kumar, the said note has been proved by PW26 Sh.G.B.Singh as Ex.PW26/A who has endorsed the said note, which is reproduced as under
112. In the said note, it is noted that the MOS, UD had recommended to UDM for allotment of shops in Lajpat Rai Market to RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 67 of 194 68 Smt.Krishna, however "it may be mentioned that any shop falling vacant in markets where ownership rights have been granted, will be alloted on auction. In markets where ownership rights have not been granted and shops continue to be on licence fee basis, whenever any shop falls vacant, it has to be alloted by calling tenders" and on page 18 of file D4 it is noted that at present there are four markets where ownership rights have already been conferred under the Directorate of Estates and in all these markets, if any shop falls vacant, it can only be disposed off through open auction/competent tenders. Even the new markets which have come up in various government colonies, the shops are to be alloted on auction/tender basis. The requisite note prepared by Sh.Harcharanjit Singh, Director who has been examined as PW22, is reproduced as under RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 68 of 194 69
113. Then, at page 19 and 20 of file D4 there is a note by then Secretary (UD) Mr.K.Padmanabhaiah which is Ex.PW28/A, same is reproduced as under RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 69 of 194 70 Thereafter, on the same page there is a note by PW11 G.V.Krishna Rau (DS, L&WS) dated 31.12.93 which is Ex.PW 11/B, the same is reproduced as under
114. In the said note, the said officer writes the detailed policy history starting from OM dated 24.3.79 which was only basis for disposal of shops for RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 70 of 194 71 the L&DO in the government colonies, therefore the new shopping centers are to be disposed off, as per the said note by public auction by L&DO, but since the reserve price was very high, therefore no bidder came forward and there was a proposal to refix the reserve price which has been submitted separately from the Lands Division. Regarding the shop no.85 it was stated that even the reserve price for this shop had not been fixed, therefore shop no.85, PG Market had not been disposed off by auction.
115. Thereafter, the file went to the Director of Estates PW22 Harcharanjit Singh, who made notings at page nos. 20,21,and 22 in the file D4 which he has proved in his testimony as Ex.PW22/D(exhibit mark inadvertently not put on the said noting). The same is reproduced as under RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 71 of 194 72 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 72 of 194 73
116. In the said note, the Director of Estates gives the detail history of allotment in the markets, where the ownership rights were conferred on original allottees, as per the cabinet decision of 1978, one of them was Lajpat Rai Market (P.G.Market). It was also RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 73 of 194 74 discussed that the policy for allotment and management of shopping centres in Central Government colonies was reviewed, it was decided on 1979 with the concurrence of Finance Ministry that the shopping centres constructed in newly constructed Central Government colonies will be disposed off by the L&DO through open auction which amounts to their disposal on leasehold basis. It is also stated in the said detailed note that in 1991, they were considering the proposal for regularization of shops in P.G. Market including shop no.85 which was vacated in 1981, it was decided that L&DO may be requested to go ahead with the disposal of this shop as per their norms and procedures, in other words any shop falling vacant in the markets where ownership rights have been conferred is to be transferred to L&DO for auction. It was also stated in the said note that the shop no.85, 325 and 405 situated in Lajpatrai market (PG Market) are located in a market where ownership rights had been conferred, these may be auctioned by L&DO.
117. Thereafter, the matter went again to the Secretary, UDM Mr. K.Padmanabhaiah, who has made another noting dated 18.1.94 on page 23 of file D4, same is reproduced as under RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 74 of 194 75
118. In the said note, the Secretary, UD noted that in the P.G. Market (the one under consideration), the procedure was to allot shops on perpetual RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 75 of 194 76 lease basis. For this purpose L&DO was required to auction the shops falling vacant by fixing reserve price, but since the reserve price was very high, hence not many persons participated in the auction, however the reserve price was being lowered substantially to 1/4th of the earlier reserve price and he also opined that there was no reservation for SC/ST which should be extended in future, but there are 22 persons whose names have been recommended by various VIPs for allotment of shops and they may also apply / participate in the auction, if they so desire. Thereafter, the matter went again to the table of A2 who was then MOS (UD), who made a detailed note dated 19.01.94 Ex.PW9/B in the same file at page 24, same is reproduced as under RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 76 of 194 77
119. In the said note, he differed from the noting of Secretary, UD dated 18.1.94 and recommended for allotment of shops to L.Tsering and Kessang Tsering and also to Smt.Krishna on the ground that the above persons were hailing from NorthEast of India, who were feeling alienated so as to integrate them into main stream and Smt.Krishna was a very poor lady who should be alloted shop on compassionate basis. Thereafter, UDM recommended the allotment of shops no.405 and 85 to L.Tsering (A3) and Smt.Krishna (A4) respectively vide note Ex.PW27/E.
120. Vide notes on page 25 and 26 on file D4 made by Mr.G.B.Singh PW26, who was working as Dy.Director (Office and Market) in the Directorate of Estates, the said notes on page 25 is Ex.PW15/B which was proved by V.P.Sharma, Desk Officer and the endorsement of Mr.G.B.Singh is at page 26 of the said noting file which is Ex.PW27/D, it also bears the signatures of PW27 Sansar Patnayak. The said notes are reproduced as under RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 77 of 194 78 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 78 of 194 79
121. The said notes at page 25 and 26 also gives the history RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 79 of 194 80 of allotment and the policy of public auction regarding these two shops alloted in PG Market to L.Tsering (A3) and Smt.Krishna (A4) stating that in PG Market where ownership rights have been conferred, the shops are to be disposed off by public auction and not by leave and licence basis. It was also noted on page 26 that in the past, UDM had made allotments to different persons in newly constructed markets in government colonies like Lodhi Road complex, DIZ area, Hanuman Road on leave and licence basis on payment of economic licence fee. The allotments of these shops were made as per the orders of UDM after referring the matter to the Finance Division. It was for the first time that UDM had made allotment of shops in a rehabilitation market where the government had already conferred ownership rights.
122. It was also stated that the economic licence fee of rehabilitation markets have not been revised since 1964, although in other markets, licence fee has been revised thrice after 01.04.85 and the UDM had also not indicated the rate of licence fee to be charged. It was also stated that four shops as mentioned in the said note at page 26, as above had been allotted on the last few years on tender basis, therefore as per the existing policy, the two shops in question were also to be alloted on the basis of public auction and RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 80 of 194 81 allotment of any shop in these markets to any other person would be a departure from public policy involving financial implications and loss of revenue, therefore concurrence of Finance Division may be taken.
123. Thereafter, the matter was sent to Finance Division and vide detailed note dated 05.05.94 (running into 3 pages) at pages 27,28,29 of file D4 which are Ex.PW15/A, the opinion of the Finance Division of the Ministry of UD was taken, which is reproduced as under RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 81 of 194 82 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 82 of 194 83 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 83 of 194 84
124. In the said note also, the detailed policy regarding the allotment of shops in the ownership markets including the PG Market was discussed based on OM dated 24.03.79 stating that any allotment of the shops in the said markets may be disposed off by way of public auction, but since there was an exception clause at para 3 of the said OM dated 24.03.79 that some exceptions could be made "if the circumstances so warrant" and the said exception was tested in 1989, when the then UDM approved allotment of 15 shops in Hanuman road and other markets which was also objected by then Joint Secretary (Finance) stating that the wholesale exception could make it a rule than exception.
125. Regarding the allotment of two shops in question, it was reiterated that the existing policy was that the shops which were allotted to certain individuals with the approval of UDM, as referred to above, were also to be disposed off through public auction, since the shops were situated in a market where ownership rights had been conferred and also even if, examined from the purely financial point of view, PG RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 84 of 194 85 Market was situated at the heart of Delhi, just opposite Red Fort and it was hub of commercial activity and because of this, if the two shops were to be disposed off through public auction it will earn for government quite a handsome amount of revenue. He also stated that some other shops as mentioned at page no.26 above were put on tender basis which generated quite a good amount of revenue for the government and therefore, if the two shops in question were to put to tender, it could fetch quite a sizeable revenue for the government, since these two shops are high potential entities from the financial point of view.
126. Thereafter, the matter was again put up before Joint Secretary and Finance Advisor in the Ministry of UD Sh.Girish Bhandari PW20, the detailed note at page no.29 and 30 in file D4 has been proved as Ex.PW15/DA also bearing signatures of PW20 at point A, the same is reproduced as under RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 85 of 194 86 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 86 of 194 87 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 87 of 194 88
127. In the said note it has been noted that the Director of Estates has mentioned there is a departure from existing policy, one solution could be to allot shops in any other areas where 15 shops were alloted in 1989, same may be considered. In the alternative, if it is not so decided, the rates of licence fee on which these shops are to be alloted be worked out and the said shop be given on licence fee basis for a limited period of 2 to 3 years.
128. Thereafter, on page 30,31 and 32 of file D4 the matter went to Sh.N.P.Singh, who was working as Addl. Secretary, Ministry of Urban Affairs and Employment, Dept. of UD, the detailed note made by him as above has been proved as Ex.PW20/DA bearing his signatures at point X dated 11.05.94, same is reproduced as under RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 88 of 194 89 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 89 of 194 90 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 90 of 194 91
129. He also noted that as per the existing policy, the two shops were to be sold by public auction after fixing the reserve price, however since the grounds for exception have already been RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 91 of 194 92 examined by MOS, UD at page 24 mentioned as above, and the matter has also been examined by the Finance Division, therefore the shops may be alloted to the persons mentioned in the order on leave and licence basis for a maximum period of 5 years nor ruling out the option of public auction or tender in due course. Thereafter, the Secretary UD as well as MOS, UD i.e. Accused no.2, who vide noting on page no.33 Ex.PW9/C in file D4, reproduced as under RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 92 of 194 93
130. Vide said noting MOS (UD) ordered for allotment of shop no.405 and 85 respectively to L.Tsering (A3) and Smt.Krishna (A4) on regular basis on payment of licence fee. It was also stated that the ownership may be transferred to them after the reserve price had been worked out. The UDM also agreed for the allotments and therefore, it was ordered that allotment order be issued and possession be given after the licence fee is fixed vide endorsement dated 16.05.94 Ex.PW9/D and vide endorsement dated 16.05.94 by PW27 Sansar Patnayak Ex.PW27/F, it was ordered that draft allotment letters be issued in favour of these persons.
131. The defence of the accused person is that, as per the OM No.17017/4/77W2 issued by the Government of India, Ministry of Works & Housing dated 24.03.79 Ex.PW11/C, which OM was with regard to policy to be adopted for development and construction of shopping centers in various government colonies in Delhi, clause2 of the said OM is the general rule whereas clause3 is the exception thereto vide which Minister had the discretion to allot the shops by exercising exception clause, which reads as under
2. Keeping these factors in view, the general question of development and construction of shopping centres in various Govt. colonies RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 93 of 194 94 and Community Centre Complexes has been considered in consultation with Lands Division and Finance Division and it has been decided that the following proceeding should be followed in the matter of development/construction/management of shopping centres in various Govt. colonies and Community Centre Complexes / Commercial Centres in the land under the control of the Central Government :
(1) Construction of Convenient/Local Shopping Centres:
(a) Sanctioned Schemes: Govt. have sanctioned construction of one Convenient Shopping Centre each in BadarpurMehrauli Road area and Sadiq Nagar; the project estimate for construction of 15,300 houses in Delhi already sanctioned, also provides for construction of Convenient/Local Shopping Centres in various colonies where quarters would be constructed. In RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 94 of 194 95 these cases, the construction would be undertaken by the CPWD and, thereafter, the shops would be sold by auction by the Land and Development Officer, after fixing minimum reserve price in consultation with the Finance Division.
3. While the above would be the general policy to be adopted in future, exceptions may be made if the circumstances so warrant.
132. They have also relied upon Clause 3 (a)(i) and the exception clause 12 of the Manual of Office Procedure Ex.PW12/B2 regarding management of Central Government Markets in Delhi/New Delhi, revised upto February 1, 1992 issued by the Directorate of Estates, which are also reproduced as under
3.(a)(i) All vacancies shall be filled, as a rule, by inviting tenders from the public.
12. Relaxation of Rules The Government may, for reasons to be recorded in writing, relax all or any of the provisions of the rules/instructions governing the policy of allotment, regularisation, restoration of shops etc., in Central Government Markets managed by the RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 95 of 194 96 Directorate of Estates.
133. It was also argued that as per the Manual of Office Procedure regarding management of Central Government Markets in Delhi/New Delhi, revised upto February 1, 1992 issued by the Directorate of Estates, the Minister was fully competent to make exceptions by recording the reasons in writing and in this case there was cogent reasons for exercising the said discretion, as (A3) L.Tsering was Scheduled Tribe candidate from NorthEast, and the people from NorthEast had to be given representation so as to integrate them in the main stream. Regarding other candidate Smt.Krishna (A4), the discretion was exercised, as she was a widow having very poor economic condition, and the said discretion had earlier also been exercised in the year 1989 by the then UDM who had similarly alloted 15 shops in different markets situated in various government colonies to different people on the basis of abovementioned OM/Manual. Therefore, the said discretion had also been earlier exercised and no fault had been found in the same, therefore the exercise of discretion in this case in favour of these two persons cannot be faulted.
134. Further, the defence counsels have relied upon the RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 96 of 194 97 noting made by PW11 G.B.Krishna Rau, dated 24.04.92 who was working as Land and Development Officer in file D5 page 106, 107 and 108, same is Ex.PW11/A1, the said notings are reproduced as under RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 97 of 194 98 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 98 of 194 99
135. In the said detailed notes at page 106, he has stated that it was decided in 1979 that shopping centers constructed in newly constructed central government colonies be disposed off by public auction, but the same could not be done due to high reserve price, in the meanwhile there was a proposal to transfer the shops to local bodies, but RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 99 of 194 100 the same also could not materialize, thereafter there was a move for refixation of the reserve price and in the year 1989, some shops were disposed off on licence fee basis on the recommendations of the then UDM.
136. Thereafter, at page 114, 115 and 116 of file D5 there is a note by R.Vishwanathan, Desk Officer dated 14.12.93 which is Ex.PW34/E, same is reproduced as under RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 100 of 194 101 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 101 of 194 102 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 102 of 194 103
137. There is also a note at page 117 to page 122 Ex.PW11/G by the same officer which is reproduced as under RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 103 of 194 104 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 104 of 194 105 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 105 of 194 106 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 106 of 194 107
138. In the aforesaid note, he has also stated regarding the fixing of reasonable reserve price for disposal of shops situated in government colonies and the markets constructed by CPWD were transferred to L&DO for auction, but there was no response from bidders due to very high reserve price, thereafter there was a proposal to refix the reserve price even reducing the rates by 50%. He also stated about the allotment of 15 shops on licence basis by then UDM in year 1989 and there was a proposal for disposal and maintenance of shopping centers mentioned in his note that same be transferred to the local bodies and in the detailed note he stated that the proposal regarding fixation of revised price should be revisited and it should be made reasonable to attract prospective bidders and it was also to be kept in mind that the shops were lying in dilapidated condition requiring extensive repairs by the CPWD.
139. There is another note at page 123 to 126 dated 15.02.94 in file D5 by Sh.K.Dharmarajan same is Ex.PW10/B, which is reproduced as under RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 107 of 194 108 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 108 of 194 109 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 109 of 194 110 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 110 of 194 111
140. In the said note, he had given the detailed background for the disposal of shops constructed in government colonies which were to be disposed of by the L&DO, as per the 1979 OM and regarding the fact that Director of Estates was managing 32 markets, four of them were rehabilitation RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 111 of 194 112 markets and that in 1979 decision was taken that in future, shops will not be given on licence fee basis, but be given on lease basis by public auction and the fact that the reserve price being very high could not attract bidders and the re fixation of reserve price.
141. Further, though A5 Smt.Tulsi Balodi expired and proceedings against her stood abated on 21.08.2014, but the manner in which the allotment was made to A5 needs to be discussed. In this regard, a note date 30.03.94 has been proved as Ex. PW10/DC which also bears the signatures of PW27 Sansar Patnayak at point A. The page no.1 and 2 of file D3 is reproduced as under: RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 112 of 194 113 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 113 of 194 114
142. It is apparent from the said note that an application was received from A5 Tulsi Balodi for allotment of shop in market of Hanuman Road, though as per the existing policy, the said shop had also to be alloted by following the process of public auction after fixing the reserve price vide OM dated 24.03.79, however a favourable note was put up for allotment of shop in her favour vide endorsement Ex.PW22/A of the same date i.e. 30.03.14. The matter was put up before Secretary, who approved the matter on same day. The UDM Smt.Sheila Kaul (A1) approved it on 09.04.1994. Thereafter, shop no.2, Hanuman Road Market was alloted to her without even getting any concurrence from the Finance Division or getting the matter examined by other officials of the UD Ministry including Joint Secretary and Director of Estates etc. It is clearly mentioned in the said note itself that it had been ascertained from L&DO that a proposal for auctioning the vacant shops /stalls based on actual FAR covered has been prepared and was put up for approval of UDM, yet the said note was approved by the UDM on 09.04.1994.
143. Relying upon the aforesaid notings, the Ld. defence counsels have argued that the shops in question were lying vacant RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 114 of 194 115 for a long period of time and no bidder had come forward for auction due to high reserve price and most of the shops were lying in a dilapidated condition requiring extensive repairs on behalf of CPWD. Since, the process of reserve price was undergoing change, therefore (A2) P.K.Thungon was fully justified in allotting the shops to (A3) L.Tsering and (A4) Smt.Krishna. In fact, such a discretion had already been exercised by previous UDM, as per which 15 shops were alloted to different persons in year 1989, as per the exception clause3 of the OM dated 24.03.79. Therefore, it is stated that there is nothing wrong in discretion exercised by A2 P.K.Thungon.
144. The Ld. defence counsels have relied upon the cross examination of various witnesses examined by the prosecution in support of their contention to prove that the discretion in the present case has been validly exercised. For instance, in the cross examination of PW10 K.Dharmarajan, who had proved the notings in the file D5 as Ex.PW10/A to Ex.PW10/F. He in his cross examination has stated that the policy prevailing in 1994 was the policy which was formulated in 1979 by way of OM. It was correct that as per clause3 of the OM, there were exceptions which were to be made to the general policy, if the circumstances so required. He RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 115 of 194 116 in his further crossexamination also stated that in the note Ex.PW10/DB contained in file D1, it was correct that in the said note he recommended allotment by exercise of clause3 of the OM, as the applicant belonged to NorthEast and they should be integrated with the main stream. Similarly, in the crossexamination of PW11 G.B.Krishna Rau, who has proved his notings Ex.PW11/A to Ex.PW11/G. He has stated that it was correct that as on 08.04.94 there was no revised reserve price fixed for the shops that were lying vacant and to dispose off these shops by public auction. It was correct that the shops had been lying vacant for 8 to 10 years and the revision of the reserve price for the disposal of the shops was under consideration. The earlier Minister had allotted some shops on licence basis. He further deposed that as per his note dated 05.05.93 Ex.PW11/D, it was earlier suggested to decide as a policy to dispose off all shops on licence fee basis.
145. Similarly, PW20 G.C.Bhandari in his cross examination has stated that in order to keep the auction of the shops, he recommended that the shops may be alloted to the persons on leave and licence basis for a maximum period of 5 years. Sh.N.P.Singh further observed in his note that "Directorate of RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 116 of 194 117 Estates does not seem to have any clear cut or cogent policy which would facilitate quick disposal of government property like shops, kiosks, stalls to the deserving persons either on basis of auction or by tenders". He further deposed that shops in question had been lying vacant for more than 15 years, as there was no bidder. In his further cross examination he stated that the physical condition of the shops had deteriorated which had necessitated the disposal of shops immediately. He further deposed that Sh.Krishna Rau had suggested in his note that "considering that these shops remained unalloted, unutilized for almost 10 years, in some cases they do require extensive repairs, this work is undertaken perhaps that is likely to cause more avoidable delay and this additional cost to be incurred on repairing most of the shops will have to be added to the reserve price".
146. Thereafter, PW22 Harcharanjit Singh in his cross examination has stated that it was correct that the Minister had approved category of persons for relaxation falling under the category of widows, handicap, unemployed graduates, SC/ST and other compassionate grounds. It was correct that the allotments RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 117 of 194 118 made vide files D1, D2 and D3 were covered under these categories approved.
147. Thereafter, PW26 Sh.G.B.Singh, who was working as Dy.Director (Office and Market Section) under Directorate of Estates in his cross examination has stated that the matter had been referred to the Finance Division and the licence fee was charged in accordance with the directions of Finance Department. It was correct that an undertaking was given by the allottees that the licence fee and other charges would be payable by them, as may be decided from time to time by the government and the same would be chargeable retrospectively. It was correct that it was the condition of the licence, it could be revoked by the government at any time without stipulation of any period and to this effect an undertaking was also given by the office.
148. It was also correct that there was a provision in the manual for allotment of shops that the rules may be relaxed by the competent authority in appropriate cases after giving reasons. It is correct that the note by Mr.P.K.Thungon, then MOS (UD) dated 06.08.93 Ex.PW10/A contains the reasons for relaxing the rules for allotment of shop to the candidates mentioned therein. The matter RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 118 of 194 119 for allotment of rules was examined by Sh.N.P.Singh, then Addl.Secretary vide his note dated 11.05.94 Ex.PW20/DA, who also observed that Directorate of Estates does not seem to have any clear cut or cogent policy which would facilitate quick disposal of government property either on the basis of auction or by inviting tender.
149. He further stated in cross examination that it was correct that in note Ex.PW15/A, it is recorded that the said exception was tested in 1989, when the UDM had approved allotment of 15 shops in various markets. He further deposed that it was correct that till he left the Ministry of UD, the issue relating to charges including the ground rent was not finalized and it is also reflected so in his note dated 19.05.95.
150. Similarly, PW27 Sansar Patnayak in his cross examination has stated that A2 P.K.Thungon, who was then working as MOS (UD) had recommended the allotment of shops to (A3)L.Tsering and (A4) Smt.Krishna on compassionate ground by exercising exception clause. He further deposed that he was aware that the reserve price for auction or inviting tenders for allotment of shops had not been fixed even till late 1995.
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151. Similarly, PW38 Sh.K.Padmanabhaiah, who was working as Secretary, UD at the relevant time of allotment of two shops to A3 and A4 has deposed in his crossexamination that the MOS (UD) had recorded earlier that there was no well defined policy in matter of disposal of shops. It was correct that in his note, he had recorded that earlier also vacant shops were put for auction, but since the reserve price was too high, the same could not be auctioned and the auction was not successful and during his tenure the reserve price was not finalized.
152. Thereafter, PW29 Purshottam Bhardwaj has also stated in his crossexamination that it was correct that there was an exception clause in the office manual for allotment of shops which was then prevailing. There was also reservation for SC/ST in the matter of allotment of shops by inviting applications from these reserved categories for allotment to be made by draw of lots and that A2 had recommended the allotment of shops to A3 and A4 on the basis of exception clause.
153. Similarly, PW34 Sh.R.Vishwanathan has deposed in his cross examination that it was correct that modalities for disposal of the shops were required to be reviewed in view of high reserve RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 120 of 194 121 price, but the same could not be finalized till he worked there. It was correct that the reserve price of the shops was reduced by 50% after the unsuccessful auction in the first instance and still there were no bidders at the reduced price. He also recorded in his note dated 14.12.93 Ex.PW34/E that most of the shops are lying in dilapidated condition requiring extensive repairs, the local bodies had asked for the shops free of cost. Lastly, he stated that the policy for allotment of shops was under review after the failure of previous auction, but the same could not be finalized till he remained there.
154. Based on the cross examination of the aforesaid prosecution witnesses, the Ld.defence counsels have argued that what kind of sin (A2) P.K.Thungon has done, as the shops in question were lying vacant for 1015 years, which were rather causing loss to the State Exchequer, as the said shops required extensive repairs and despite repeated attempts for auctioning these shops, no bidder came forward due to very high reserve price. Even the efforts to reduce the reserve price did not attract any bidders and even the local bodies were ready to accept the said shops free of cost only. He has further argued that the previous UDM in 1989 had exercised the exception clause3, as per the OM of 1979 and had allotted 15 shops to different persons and in the present case also, RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 121 of 194 122 the said exception clause had been exercised by A2 after going through the entire material on record. Even the matter had been examined by all the concerned higher officials of the UD Ministry and it was also having the financial concurrence, therefore there was no loss to the government, rather the said allotment was in public interest and the exercise of discretion was validly made, as per clause3 of OM and manual of Office Procedure for management of Central Government Markets Ex.PW21/B2.
155. Before proceeding further it would be relevant to find out, if there is any relation between A2, A3, A4 and A5. In this regard, PW8 Sh.Inder Kumar has deposed that they were five brothers and one of them was Karamveer Maan and another was Kishan Maan, who has died and accused Krishna (A4) is the wife of his brother Late Sh.Kishan Maan. IO PW30 Retired SSP P.C.Sharma has deposed in his cross examination that name of a common friend of Minister of State and Minister, to whose sisterinlaw, the allotment was made was Karamveer Singh Maan. The said assertion made by the IO in his cross examination has not been controverted by the Ld. counsel for accused Krishna. Now, reverting to another accused (A3) L.Tsering, PW12 Mr.Deshpal Singh has deposed that he knew (A2) P.K.Thungon, as he was officially maintaining the RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 122 of 194 123 computers at the office and residence of Ministers and Member of Parliament. He also deposed that accused (A3) L.Tsering is the son of brotherinlaw (i.e. brother of wife of Mr.P.K.Thungon), the said fact has not been controverted in the cross examination of this witness. Therefore, it is established that (A3) L.Tsering is closely related to A2 P.K.Thungon.
156. Though, (A5) Smt.Tulsi Balodi has expired and proceedings against her stood abated vide order dated 21.08.14, however it would be pertinent to point out her status in the society and the reason as to why allotment was made to her as well in this case, which was made on the same day on which the application was received with utmost alacrity. In this regard, her husband, Prem Ballabh Balodi has appeared as PW16. He stated that he joined Ministry of Home Affairs as Peon and in the year 1991, he joined the personal staff of the then Prime Minister of India and accused Tulsi Balodi (A5) was his wife and his wife was alloted a shop at Hanuman Road. In his cross examination he also stated that he was attached with Mr.Narsimha Rao, when he was Home Minister, but was not personally attached with him. He used to visit his residence as and when such a duty was assigned to him, after he became Prime Minister, he was deputed to his office by the Ministry RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 123 of 194 124 of Home Affairs not by Sh. Narsimha Rao. He also stated that he knew Smt.Sheila Kaul (A1) (deceased), who used to come to the residence of Mr.Narsimha Rao, when he was the Prime Minister.
157. From the aforesaid testimonies, it is established that all the accused persons A3, A4 and A5 had connections with big and mighty persons of the lutyens zone, as A3 is closely related to A2, A4 was related to one Karamveer Singh Maan, who was a close friend of A2 and A1 Smt.Sheila Kaul, whereas deceased A5 was the wife of a peon PW16 who was working in the personal staff attached with the then Prime Minister of India Sh.Narsimha Rao. Now in this scenario, it has to be seen, whether the discretion which has been exercised by A1 (deceased) and A2 in allotting the shops to A3, A4 and A5 (deceased) by using their powers, as per exception clause3 in the OM of 1979 Ex.PW11/C or as per clause12, as per the Manual of Office Procedure regarding management of Central Government Markets in Delhi/New Delhi revised upto February 1, 1992 which is Ex.PW21/B2, has been validly exercised by giving sound reasons for exercising administrative discretion or the same is totally unfair, arbitrary, malafide, violating Article 14 of the Constitution of India.
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158. In this regard it would be useful to quote from the Administrative Law, Seventh Edition, S.P.Sathe, Lexis Nexis Butterworths Page(s) 398 and 399 as under Government largesse is public property and government cannot dole it out arbitrarily. In the distribution of largesse, such as a contract, advertisement, licence, allotment of government land or a privilege, the discretion must be exercised in public interest and in accordance with the Constitution. Arbitrary disposal of largesse violates art 14. All people must have equal opportunity of being considered for such largesse and there should be neither any favouritism nor nepotism in its allotment. Although the government is free to decide whom to allot largesse to, unlike a private person, it cannot allot the largesse as it likes.
Discretion in this regard must be so used as to give equal opportunities to all eligible persons to compete for it. The State can of course decide the criteria of eligibility. For example, it may decide to give certain types of benefits only to cooperative societies or to give preferential treatment to persons from the weaker sections of society. Where the government reserved some units of the Sal forests in favour of new industrial units set up for extraction of Sal oil, without making similar reservation in favour of the old industrial units, the reservation could not RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 125 of 194 126 be held to be discriminatory. The policy was based on the recommendation of an expert committee, was supposed to stepup production of Sal seed and was not likely to incur financial hardship. Such decisions regarding eligibility must be based on reasonable classification and should not be arbitrary.
However, even if such eligibility criteria are valid, their application to individual persons also comes under judicial scrutiny and the court would strike down a decision if the actual allotment is not in accordance with such criteria of eligibility or is otherwise discriminatory. Blacklisting a contractor from government contracts merely on the ground that his relations, carrying on similar business were defaulters in paying sales tax, was held violative of arts 14 and 19(1)(g) of the Constitution. In the case of government contracts, where rules required that such a contract had to be given to persons connected with arrack trade, giving it to strangers who had no connection with that trade was held arbitrary. Allotment of petrol pumps to near friends and relations of ministers was held invalid. Similarly, outofturn allotments of houses in Delhi by a minister were held to be discriminatory. Where a contract for bottling of arrack was given to a chosen few without inviting quotations or tenders, the court struck it down. Similarly, a contract awarded at high rates without floating public tenders, thus causing RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 126 of 194 127 loss to the public exchequer, was held to be arbitrary and, therefore, void.
Although the government is free to decide who to give an advertisement to, a guideline saying that they may not be given to newspapers that were rabid or abusive, or 'raging fanatical' was held to be vague and therefore could result in discrimination.
In R.D. Shetty Vs International Airport Authority (1979) 3 SCC 489, 503; AIR 1979 SC 1628, 1635 Bhagwati J said It is a well settled rule of administrative law that an executive authority must be rigorously held to the standards by which it professes its actions to be judged and it must scrupulously observe those standards on pain of invalidation of an act in violation of them.
The learned judge further said in (1979) 3 SCC 489, 505 that The Government is still the Government when it acts in the matter of granting largesse and it cannot act arbitrarily. It does not stand in the same position as a private individual.
In M/s Kasturilal Vs Jammu and Kashmir AIR 1980 SC 1992; Also see Sterling Computers Ltd. Vs M&N Publications Ltd.
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128
(1993) 1 SCC 445, the Supreme Court once again reiterated the principle that where the government was dealing with the public, whether by way of giving jobs or entering into contract or granting other forms of largesse, it could not act arbitrarily at its sweet will. The limitations on the government's power were twofold: (i) it must give equal opportunities to all to compete for such a contract or largesse; and (ii) the contents of the contract should not be detrimental to the interests of the State. These limitations are applicable with regard to persons or parties with whom it can contract as well as to the terms of the contract.
159. Further from the various judgments rendered by the Hon'le Supreme Court from time to time, the law in this regard has been crystallized, relevant extract of following judgment is reproduced as under In Chaitanya Kumar and Others Vs. State of Karnataka and Others, (1986) 2 SCC 594 Under the Karnataka Excise(Bottling of Liquor) Rules, as they stood at the relevant time, bottling licences could only be granted to persons already connected with the liquor trade. But neither the advertisement confined its invitation to such persons only, nor the Exise Commissioner took into account that criterion while recommending that 8 persons for the contract. The Exise Commissioner excluded from consideration for the award of the bottling contracts those persons who were eligible for the grant of bottling licences and recommended such person as were not eligible for the grant of bottling licences under the rules. This was an usual, wilful and perverse way of exercising the power of RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 128 of 194 129 distributing State largesse. Even if the award of the bottling contracts was not at the expense of the exchequer, there could be no question that what was done was the distribution by the State of favours loaded with bounty by way of enabling the recipients of the favours to earn enormous profits. Moreover, the recommendation of the Excise Commissioner to award the bottling contracts to the eight 'chosen' persons was not wholly consistent with the very principle on which he had excluded as many as 119 out of 131 applications from consideration. The almost surreptitious manner in which Rule 3 was amended subsequent to the filing of some of the writ petitions also appears to give an indication regarding the anxiety of the Government to favour the chosen ones with the bottling contracts. Even if the notification dated November 23, 1984 containing the draft amendment of Rule 3 was published on November 23, 1984, there was hardly any time for anyone to make any objections since only five days time was given. The so-called policy decision and the principle purported to be enunciated by the Excise Commissioner were a mere pretext designed to eliminate all except the chosen.
Further, in Shivsagar Tiwari Vs. Union of India and Others, (1996)6 SCC 558 it was held as under:
6. The CBI has since inquired into the matter in some detail and has by now submitted 4 interim reports. According to the CBI, orders of allotment in respect of the shops/stalls in question were passed by Smt. Shiela Kaul, the then Minister of Urban Development, and "all the 6 shops have been allotted by her to her own relatives/employees/domestic servants of her family members and family friends. She has allotted 2 shops to her 2 gransons, one shop to the maid servant of her son, Sh. Vikram Kaul who is residing in Dubai, one shop to handloom manager of the firm owned by her son-in-law and another shop to a close friend. One shop has been allotted to the nephew of the Minister of State, Sh. P.K.Thungon. While making allotments in respect of stalls, she has allotted most of stalls to the relatives/friends of her personal staff and officials of Dte. of Estates". The CBI has also reported that Smt. Sheila Kaul had made ten different categories of persons as the basis for deciding RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 129 of 194 130 allotments, but even this categorisation was not adhered to while making allotments. The further findings are: (1) "Many other organisations/persons who had also applied for allotment and no reasons, whatsoever, were assigned for non-allotment of shops/stalls to them"; and (2) "At the time of discretionary allotments made by Smt. Shiela Kaul in 1993 and 1994 persons who were relations of her personal staff were considered and allotted shops"
7. In the order dated 19.07.1996 this Court noted that a regular case under Sections 120-B, 420, 468/471 IPC and Section 13(2) r/w Section 13(1)(d) of the Prevention of Corruption Act, 1988, has been registered against Smt. Shiela Kaul and her Additional Private Secretary Rajan S Lala and Others. The order of that date has also noted about various other steps taken, which include issuance of show cause why allotments of shops/stalls should not be cancelled. It was desired that the notices be served within a week and the Estate Officer, after considering their replies, if any, place a report before the Court within four weeks.
8. Such a report was filed under the affidavit of Sh. Harcharan Jeet Singh, Director of Estates, which was taken up for consideration on 06.09.1996. The affidavit of the Director has stated that from 1994 onwards 52 shops/stalls had been sanctioned by the then Minister of Urban Development(Smt. Shiela Kaul) out of which 7 shops were allotted by Smt. Kaul before she had approved the policy of 1994 and the remaining 45 shops were allotted after the policy of 1994. In the affidavit the gist of objections allotted after the policy of 1994. This court thought it appropriate to give an opportunity of hearing to all these persons before any action was taken. A direction was, therefore, given to the Director to issue individual notices to the 52 persons(wrongly mentioned as 42 in the order) to be personally present in the court or be represented through their counsel on 27th September. These allottees so appeared either in person or through counsel and they were heard. The sum and substance of the representations of the allottees was that they had been given an allotment either because of their being unemployed youths, freedom fighters, handicapped, members of Scheduled Castes/Scheduled Tribes, RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 130 of 194 131 widow or poverty stricken.
9. Question is whether they were selected in accordance with law, which aspect has its importance because apparently a large number of other persons could as well fall within the categories in question and had applied also. From the report of the CBI it is clear that the allottees had been selected, not by following the tender system, as required by the policy of 1994, but because of their relationship with the Minister or her personal staff, or being employees or friends of such persons. If that be so, the allotments were wholly arbitrary and speak of misuse of power. The all important question is what is required to be done to undo the wrong and how the wrongdoer is to be dealt with within the parameters known to law.
10.It would be apposite in this context to refer to the recent decision of this Court in common cause, a Registered Society v. Union of India, in which one of us(Kuldeep Singh J) reiterated the need to act fairly and justly in the matter of grant of largesses, pointing out that any arbitrary distribution of national wealth would violate the law of land, Mention was made of the judgment in Lucknow Development Authority v. M.K.Gupta, stating that the same approved "misfeasance in public office" as a part of the law of the tort. It was pointed out that public servant become liable in damages for malicious, deliberate or injurious wrongdoing.
160. This is the case in which the allotments of shops / government quarters were set aside by Hon'ble Supreme Court as arbitrary allotments and as per the directions of Hon'ble Supreme Court, the FIR was registered against the accused persons including A1 and A2.
161. The Hon'ble Supreme Court in the following latest case, pertaining to 2G Scam Spectrum held as under: RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 131 of 194 132 Natural Resources Allocation, IN RE Special Reference No. 1 of 2012, (2012) 10 SCC 1
146. To summarise in the context of the present Reference, it needs to be emphasised that this Court cannot conduct a comparative study of the various methods of distribution of natural resources and suggest the most efficacious mode, if there is one universal efficacious method in the first place. It respects the mandate and wisdom of the executive for such matters. The methodology pertaining to disposal of natural resources is clearly an economic policy. It entails intricate economic choices and the Court lacks the necessary expertise to make them. As has been repeatedly said, it cannot, and shall not, be the endeavour of this Court to evaluate the efficacy of auction vis-a-vis other methods of disposal of natural resources. The court cannot mandate one method to be followed in all facts and circumstances. Therefore, auction, an economic choice of disposal of natural resources, is not a constitutional mandate. We may, however, hasten to add that the Court can test the legality and constitutionally of these methods. When questioned, the courts are entitled to analyse the legal validity of different means of distribution and give a constitutional answer as to which methods are ultra vires and intra vires the provisions of the Constitution. Nevertheless, it cannot and will not compare which policy is fairer than the other, but, if a policy or law is patently unfair to the extent that it falls foul of the fairness requirement of Article 14 of the Constitution, the court would not hesitate in striking it down.
147. Finally, market price, in economics, is an index of the value that a market prescribes to a good. However, this valuation is a function of several dynamic variables: it is a science and not a law. Auction is just one of the several price discovery mechanisms. Since multiple variables are involved in such valuations, auction or any other form of competitive bidding, cannot constitute even an economic mandate, much less a constitutional mandate.
148. In our opinion, auction despite being a more preferable method of alienation/allotment of natural resources, cannot be held to be a constitutional requirement or limitation for alienation of all natural resources and therefore, every method other than auction cannot be struck down as ultra vires the constitutional mandate.
149. Regard being had to the aforesaid precepts, we have RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 132 of 194 133 opined that auction as a mode cannot be conferred the status of a constitutional principle. Alienation of natural resources is a policy decision, and the means adopted for the same are thus, executive prerogatives. However, when such a policy decision is not backed by a social or welfare purpose; and precious and scarce natural resources are alienated for commercial pursuits of profit maximising private entrepreneurs, adoption of means other than those that are competitive and maximise revenue may be arbitrary and face the wrath of Article 14 of the Constitution. Hence, rather than prescribing or proscribing a method, we believe, a judicial scrutiny of methods of disposal of natural resources should depend on the facts and circumstances of each case, in consonance with the principles which we have culled out above. Failing which, the Court, in exercise of power of judicial review, shall term the executive action as arbitrary, unfair, unreasonable and capricious due to its antimony with Article 14 of the Constitution.
162. There is no doubt in view of the aforesaid settled law and in view of the judgment of Hon'ble Supreme Court in Shivsagar Tiwari (supra), the allotments of shops made by A1 and A2 to their close relatives, kith and kin of close friends as well as to the family members of a person serving the then Prime Minister is totally arbitrary, unfair, unreasonable and violation of Article 14 of Constitution of India. There is no reasonable classification or exercise of discretion in a fair manner, rather it is a case of gross favouritism and nepotism.
163. Regarding the sanction part, as already stated above, Ld. defence counsel Sh.S.P.Minocha on behalf of A2 P.K.Thungon has argued that the sanction in the present case had been accorded RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 133 of 194 134 by PW24 V.K.Malhotra vide sanction order dated 23.04.1998 viza viz (A1) Sheila Kaul (deceased) and (A2) P.K.Thungon. At that time he was working as Joint Secretary to the Government of India, Ministry of Home Affairs. He had argued that the said sanction order is invalid, as firstly, PW24 was not competent to grant sanction to a Cabinet Minister i.e. (A1) and MOS (A2), no rule has been stated in the sanction order Ex.PW24/A that he was having any delegated powers on behalf of Hon'ble President of India to accord the sanction to prosecute (A1) and (A2) u/S 197 Cr.P.C. Secondly, no material was produced or placed before the sanctioning authority, therefore the sanction order had been passed without going through any material, in a mechanical manner without due application of mind.
164. I have gone through the said contentions of Ld. defence counsel and the contrary arguments of Ld. Public Prosecutor for CBI. The said sanction order has been proved as Ex.PW24/A. From the said sanction order, it appears that entire material was perused by the Sanctioning Authority, as is evident from the detailed sanction order (running into 6 pages). From the said sanction order, it is clear that the Sanctioning Authority had gone through the material documents pertaining to the present case before according RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 134 of 194 135 the sanction. It is also written in the sanction order at page no.6 that the said sanction had been accorded in the name of Hon'ble President of India and the Central Government after carefully examining the material placed before it, had come to the conclusion that facts and circumstances of the case warrant that (A1)Smt.Sheila Kaul (deceased) and (A2)P.K.Thungon be prosecuted for the offence(s) mentioned in the said sanction order. Therefore, sanction u/S 197 Cr.P.C was accorded to prosecute A1 and A2.
165. In his cross examination, PW24 has denied the suggestion that he had passed the sanction order in a mechanical manner, rather it appears that the sanction order was passed independently without being influenced by any draft sanction order sent by CBI, as he in his cross examination has stated that no draft sanction order in this case was received from CBI and it was drafted in his office. He denied the suggestion that he was not competent to grant sanction for prosecution of A1 (deceased) who was then working as a Cabinet Minister and A2 who was then holding charge as Minister of State.
166. Even otherwise, for the sake of argument, if it is RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 135 of 194 136 assumed that the said sanction order is not a valid sanction order, as PW24 was not having either the delegated powers to pass the sanction order on behalf of Hon'ble President of India or that he was not competent to do so for various other reasons, even then it was held in many judgments of the Apex Court that it is not every offence committed by a public servant which requires sanction u/s 197 Cr.P.C. It is no part of the duty of public servant while discharging his official duty to enter into criminal conspiracy or to indulge in criminal misconduct. In this regard the following judgments are re produced as under:
1. HHB Gill Vs. The King AIR 1948 PC 133 A public servant can only be said to act or purport to act in the discharge of his official duty, if his act is such as to lie within the scope of his official duty. Thus, a Judge, neither acts nor purports to act as a judge in receiving bribe.
2. Amrik Singh vs. State of Pepsn AIR 1955 SC 309 = 1955 Cr.LJ 865 It is not every offence committed by a public servant which requires sanction U/s 197 Cr.P.C. It is no part of the duty of public servant while discharging his official duty to enter into criminal conspiracy or to indulge in criminal misconduct.
3. Hariha Prasad Vs. State of Bihar 1972 CrlJ 707 As far as offence of criminal conspiracy punishable U/s 120 r/w 409 IPC and also Section 5(2) RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 136 of 194 137 of PC Act, are concerned, they cannot be said to be of the nature mentioned in section 197 Cr.P.C. To put it shortly, it is no part of public servant while discharging his official duties, to enter into criminal conspiracy or to indulge in criminal misconduct, want of sanction U/s 197 Cr.P.C is therefore no bar.
4. State of Kerala Vs. Padmanbhan JT 1999 SC 499 Sanction for prosecution U/s 197 Cr.P.C is not required if offences are U/s 409 r/w 120-B IPC; and accused cannot claim immunity on the ground of want of sanction, if he ceased to be a public servant on the day when Court has taken cognizance of the said offence.
5. Prakash Singh Badal Vs. S.O.Punjab (2007) 1 SCC 1 The offence of cheating U/s 120B IPC r/w S 467, 468, 471 IPC, can, by no stretch of imagination, be regarded as having been committed by any public servant while acting or purporting to act in discharge of his official duty. Sanction U/s 197 Cr.P.C is not required.
167. In view of the law laid down in the above judgments, the act of illegal allotment of shops to A3, A4 and A5 after entering into conspiracy with each other on behalf of A1 and A2, thereby causing loss to the State Exchequer without public interest, thereby causing pecuniary advantage to the said allottees A3, A4 and A5 (deceased), cannot be said to be any part of their official duties that is to say that there is no nexus between the act and discharge of RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 137 of 194 138 their official duties, as it is no part of their official duties to indulge into official conspiracy or misconduct, therefore there is no irregularity or illegality in the sanction.
168. Now, it is to be seen whether the said acts of allotment of shops to A3, A4 and A5 also attract criminal liability, as per the provisions of PC Act and IPC. In this regard, it would be relevant to point out that (A1) Smt. Sheila Kaul (deceased), (A2) P.K.Thungon, (A3) L.Tsering, (A4) Smt.Krishna and (A5) Tulsi Balodi (deceased) have been charged u/S 120B IPC r/w Sec.409 IPC and 13(2) r/w Sec.13(1)(c) and 13(1)(d) of PC Act. No charges were framed against the aforesaid accused persons under any of the substantive offence(s). The charge for substantive offence(s) was only framed against A1 Smt.Sheila Kaul (deceased) u/S 120B IPC r/w Section 409 IPC and Section 13(2) r/w Section 13(1)(c) and 13(1)(d) of PC Act. Since the charges against accused persons who were facing trial at present namely A2 P.K.Thungon, A3 L.Tsering and A4 Smt.Krishna have only been framed with regard to conspiracy part as pointed out above, therefore it has to be seen whether any conspiracy is made out from the facts proved by the prosecution as discussed above.
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CBI vs. Sheila Kaul & ors. 138 of 194
139
169. Regarding conspiracy part, relevant law was discussed by Hon'ble Supreme Court in the case titled K.R.Purushothaman Vs State of Kerala (2005) 12 Supreme Court Cases 631, relevant extract is reproduced as under:
11. Section 120A IPC defines "criminal conspiracy". According to this Section when two or more persons agree to do, or cause to be done (i) an illegal act, or (ii) an act which is not illegal by illegal means, such an agreement is designated a criminal conspiracy. In Major E.G.Barsay V. State of Bombay Subba Rao J., speaking for the Court has said :(SCR p.228) "The gist of the offence is an agreement to break the law. The parties to such an agreement will be guilty of criminal conspiracy, though the illegal act agreed to be done has not been done. So too, it is not an ingredient of the offence that all the parties should agree to do a single illegal act. It may comprise the commission of a number of acts."
12. In State V. Nalini it was observed by S.S.M. Quadri, J. at JT para 677: (SCC pp.56869, para
662) "In reaching the stage of meeting of minds, two or more persons share information about doing an illegal act or a legal act by illegal means. This is the first RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 139 of 194 140 stage where each is said to have knowledge of a plan for committing an illegal act or a legal act by illegal means. Among those sharing the information some or all may form an intention to do an illegal act or a legal act by illegal means. Those who do form the requisite intention would be parties to the agreement and would be conspirators but those who drop out cannot be roped in as collaborators on the basis of mere knowledge unless they commit acts or omissions from which a guilty common intention can be inferred. It is not necessary that all the conspirators should participate from the inception to the end of the conspiracy;
some may join the conspiracy after the time when such intention was first entertained by any one of them and some others may quit from the conspiracy. All of them cannot but be treated as conspirators. Where in pursuance of the agreement the conspirators commit offences individually or adopt illegal means to do a legal act which has a nexus with the object of conspiracy, all of them will be liable for such offences even if some of them have not actively participated in the commission of those offences."
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CBI vs. Sheila Kaul & ors. 140 of 194
141
13. To constitute a conspiracy, meeting of minds of two or more persons for doing an illegal act or an act by illegal means is the first and primary condition and it is not necessary that all the conspirators must know each and every detail of the conspiracy. Neither is it necessary that every one of the conspirators take active part in the commission of each and every conspiratorial acts. The agreement amongst the conspirators can be inferred by necessary implication. In most of the cases, the conspiracies are proved by the circumstantial evidence, as the conspiracy is seldom an open affair. The existence of conspiracy and its objects are usually deduced from the circumstances of the case and the conduct of the accused involved in the conspiracy. While appreciating the evidence of the conspiracy, it is incumbent on the court to keep in mind the wellknown rule governing circumstantial evidence viz. each and every incriminating circumstance must be clearly established by reliable evidence and the circumstances proved must form a chain of events from which the only irresistible conclusion about the guilt of the accused can be safely drawn, and no other hypothesis against the guilt is possible. Criminal conspiracy is an independent offence in the Penal Code. The unlawful agreement is sine RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 141 of 194 142 qua non for constituting offence under the Penal Code and not an accomplishment.
Conspiracy consists of the scheme or adjustment between two or more persons which may be express or implied or partly express and partly implied. Mere knowledge, even discussion, of the plan would not per se constitute conspiracy. The offence of conspiracy shall continue till the termination of agreement.
14. Suspicion cannot take the place of legal proof and prosecution would be required to prove each and every circumstance in the chain of circumstances so as to complete the chain. It is true that in most of the cases, it is not possible to prove the agreement between the conspirators by direct evidence but the same can be inferred from the circumstances giving rise to conclusive or irresistible inference of an agreement between two or more persons to commit an offence. It is held in Noor Mohd. Mohd. Yusuf Momin V. State of Maharashtra, that: (SCC pp.699700, para 7) "[I]n most cases proof of conspiracy is largely inferential though the inference must be founded on solid facts.
Surrounding circumstances and antecedent and subsequent conduct, among other factors, constitute relevant material."
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CBI vs. Sheila Kaul & ors. 142 of 194
143
15. It is cumulative effect of the proved circumstances which should be taken into account in determining the guilt of the accused. Of course, each one of the circumstances should be proved beyond reasonable doubt. The acts or conduct of the parties must be conscious and clear enough to infer their concurrence as to the common design and its execution. While speaking for the Bench it is held by P. Venkatarama Reddi, J. in State (NCT of Delhi) V. Navjot Sandhu (p.63) as follows:
(SCC pp.69192, para 103) "103. We do not think that the theory of agency can be extended thus far, that is to say, to find all the conspirators guilty of the actual offences committed in execution of the common design even if such offences were ultimately committed by some of them, without the participation of others. We are of the view that those who committed the offences pursuant to the conspiracy by indulging in various overt acts will be individually liable for those offences in addition to being liable for criminal conspiracy; but, the non participant conspirators cannot be found guilty of the offence or offences committed by the other conspirators.
There is hardly any scope for the application of the principle of agency in RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 143 of 194 144 order to find the conspirators guilty of a substantive offence not committed by them. Criminal offences and punishments therefor are governed by the statute. The offender will be liable only if he comes within the plain terms of the penal statute. Criminal liability for an offence cannot be fastened by way of analogy or by extension of a common law principle.
170. It has been further held in a case 1999 Cri.L.J.3124 State of Tamil Nadu through Superintendent of Police CBI/SIT Vs Nalini and others WITH T.Suthenthiraraja alias Santhan and others Vs State by DSP, CBI, SIT, Chennai WITh P.Ravichandran and others Vs State by DSP, CBI, SIT, Chennai WITH Robert Payas and others Vs State by DSP, CBI, SIT, Chennai WITH S.Shanmugavadivelu and others Vs State by DSP, CBI, SIT, Chennai WITH S.Nalini and others Vs State by DSP, CBI, SIT, Chennai, as under: "110. The first condition which is almost the opening lock of that provisions is the existence of "reasonable ground to believe" that the conspirators have conspired together. This condition will be satisfied even when there is some prima facie evidence to show that there was such a criminal RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 144 of 194 145 conspiracy. If the aforesaid preliminary condition is fulfilled then anything said by one of the conspirators becomes substantive evidence against the other, provided that should have been a statement "In reference to their common intention". Under the corresponding provision in the English Law the expression used is "in furtherance of the common object". No doubt, the words "in reference to their common intention" are wider than the words used in English Law, (vide Sardar Sardul Singh Caveeshar v. State of Maharashtra, (1964) 2 SCR 378: 1965 (1) Cri.L.J. 608: (AIR 1965 SC 682).
111. But the contention that any statement of a conspirator, whatever be the extent of time, would gain admissibility under Section 10 if it was made "in reference" to the common intention, is too broad a proposition for acceptance. We cannot overlook that the basic principle which underlies in Section 10 of the Evidence Act is the theory of agency. Every conspirator is an agent of his associate in carrying out the object of the conspiracy. Section 10, which is an exception to the general rule, while permitting the statement made by one conspirator to be admissible as against another conspirator restricts it to the statement made during the period when the agency subsisted. Once it is shown that a RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 145 of 194 146 person became snapped out of the conspiracy, any statement made subsequent thereto cannot be used as against the other conspirators under Section 10.
112. Way back in 1940, the Privy Council has considered this aspect and Lord Wright, speaking for Viscount Maugham and Sir George Rankin in Mirza Akbar v. KingEmperor, AIR 1940 PC 176 : (1940 (41) Cri.L.J.871) has stated the legal position thus :
" The words 'common intention' signify a common intention existing at the time when the thing was said, done or written by one of them. Things said, done or written while the conspiracy was on foot are relevant as evidence of the common intention, once reasonable ground has been shown to believe in its existence. But it would be a very different matter to hold that any narrative or statement or confession made to a relevant as evidence of the common intention, once reasonable ground has been shown to believe in its existence. But it would be a very different matter to hold that any narrative or statement or confession made to a third party after the common intention or conspiracy was no longer operating and had ceased to exist is admissible against the other party. There is then no common intention of the conspirators RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 146 of 194 147 to which the statement can have reference. In their Lordships' judgment S.10 embodies this principle. That is the construction which has been rightly applied to S.10 in decisions in India, for instance, in ILR 55 Bom 839 : (AIR 1932 Bom 56 : (1932) 33 Cri L.J.76) and (1911) ILR 38 Cal 169. In these cases the distinction was rightly drawn between communications between conspirators while the conspiracy was going on with reference to the carrying out of conspiracy and statements made, after arrest or after the conspiracy has ended, by way of description of events then past."
171. Regarding A1 Smt.Sheila Kaul (deceased) and A2 P.K.Thungon, there is definitely a conspiracy, as they were UDM and MOS(UD) respectively at the time of allotment of shops, therefore they were fully aware of the manner of allotment of shops which were to be disposed off on the basis of auction as per the established norms, as per the OM of 1979 and also the existing norms, whereby the allotments had to be made by way of public auction and open tenders, yet they in blatant violation of these norms made illegal allotments to their favourites, which is most arbitrary and unreasonable and in violation of fair play under Article 14 of Constitution of India.
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CBI vs. Sheila Kaul & ors. 147 of 194
148
172. They were also fully aware that shops allotted in P.G.Market, which was a market where ownership rights had already been conferred, could have only been done by public auction, yet they allotted the shops in the said market to (A3) L.Tsering and (A4) Smt. Krishna at a very paltry amount on licence fee basis causing financial loss to the State Exchequer, which was against public interest. The notings Ex.PW26/A in file D4, Ex.PW11/B in file D4, Ex.PW28/B in file D4 were the notings made by the senior officers including Secretary, Ministry of UD pointing out that open auction was the method for disposal of these shops and in case, the applicants (A3) L.Tsering and (A)4 Smt.Krishna or any other applicant wanted to participate in the open auction, they can do so by participating in the public auction and since the shops were located in the market where ownership rights have been conferred, these may be auctioned by L&DO. Similarly, in the note Ex.PW15/B, the same opinion was also expressed by the other officials of the Directorate of Estates and the Finance Division also expressed that since shops in P.G.Market were located in a very strategic location, it will generate quite a good amount of revenue for the government, if the shops were put on public auction, yet these objections of the Finance Division and other officials of the RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 148 of 194 149 Urban Development Ministry were glossed over by the MOS (UD) and UDM by allotting the shops to (A3) L.Tsering and (A4) Smt.Krishna, so there was a clear cut conspiracy or agreement amongst (A1) Smt.Sheila Kaul (deceased) and (A2) P.K.Thungon to make allotments in violation of the established norms by illegal means.
173. Regarding the contention of Ld. defence counsel Sh.S.P.Minocha that after the death of A1, A2 cannot be convicted independently for conspiracy, as the offence of criminal conspiracy consist in preagreement between two or more persons to commit a criminal offence irrespective of further consideration whether or not those offence(s) have actually been committed. Therefore, he argued that atleast two persons are required to constitute conspiracy and since A1 had died during the trial, therefore A2 cannot be convicted for the offence of conspiracy. The said argument of Ld. defence counsel is without any substance as it has been held in Kannangara Aratchise Dharmasena Vs King (1950) 51 Cr.L.J 1597 (PC) that one conspirator may be tried and convicted in the absence of his companions in crime.
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CBI vs. Sheila Kaul & ors. 149 of 194
150
174. Further, it has been held in Para 14 of Bimbadhar Pradhan Vs State of Orissa AIR 1956 Supreme Court 469 as under In this connection the observations of this Court int he case of 'Dalip Singh v. State of Punjab', 1953 SC 364 (367368) (AIR V
40)(G), and of the Federal Court in 'Kapildeo Singh v. The King', 1950 FC 80(81) (AIR V 37)(H), are relevant. It is not essential that more than one person should be convicted of the offence of criminal conspiracy. It is enough if the court is in a position to find that two or more persons were actually concerned in the criminal conspiracy. If the courts below had come to the distinct findings that the evidence led on behalf of the prosecution was unreliable, then certainly no conviction could have been based on such evidence and all the accused would RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 150 of 194 151 have been equally entitled to acquittal.
175. In view of the law laid down in the aforesaid judgment, by same analogy, it would be trite that even after the death of A1 (who died during the trial after framing of charge), A2 can be tried and convicted for the charge of conspiracy, as the evidence clearly suggest A1 and A2 were actually and actively involved in the offence of conspiracy.
176. Regarding the role of (A3) L.Tsering in the said conspiracy, though A3 was related to (A2) P.K.Thungon, but it cannot be said that A3 was having any part in the conspiracy, as no evidence has come on the record that there was any meeting of mind between A2 and A3 with regard to allotment of shop by illegal means in his favour, as he may be under some sort of impression that A2, who was then serving as MOS(UD), was having power to do so and that such act was a legal act and both A1 (deceased) and A2 were having powers to allot shop in his favour by following legal recourse.
177. Similarly, regarding (A4) Smt.Krishna, no evidence has come on the record that A4 ever met A1 or A2. It seems allotment was put through by her brotherinlaw Karamveer Singh Maan, who RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 151 of 194 152 was the common friend of A1 and A2. Therefore, there was no meeting of mind between A4 and A1 or A2.
178. Similarly, allotment of shop in favour of (A5) Tulsi Balodi (deceased) was put through her husband PW16 Prem Ballabh Balodi, who was working in the personal staff of the then Prime Minister of India. Therefore, there was no meeting of mind between A5 and A1 or A2 with regard to conspiracy.
179. Further, none of A3, A4 and A5 were connected with each other, having any sort of connection inter se nor there was any common thread running through all of them, so as to give inference of conspiracy among them.
180. Now, question which arises for consideration is that the conspiracy agreement between A1 Smt.Sheila Kaul (deceased) and (A2) P.K.Thungon was with regard to which offence(s). All the accused persons, who were facing trial i.e. A1 Smt.Sheila Kaul (deceased), A2 P.K.Thungon, A3 Lakhpa Tsering, A4 Smt.Krishna and A5 Tulsi Balodi (deceased) have been charged u/S 120B IPC r/w Section 409 IPC and 13(2) r/w Section 13(1)(c) and 13(1)(d) of PC Act.
181. Regarding Section 409 IPC, no offence u/S 409 IPC is RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 152 of 194 153 made out, as there was no entrustment of the shops allotted to A3, A4 and A5 upon A1, who had ultimately allotted the said shops to A3, A4 and A5, as she was the final authority to allot the shops nor it can be said that A1 or A2 were having dominion over the said shops which they dishonestly misappropriated or converted to their own use or disposed off the same in violation of any direction of law prescribing the mode in which the said trust was to be discharged. Perusal of record reveals that the possession letter Ex.PW26/G dated 31.05.94 in file D3, which is the letter of allotment of A5 Tulsi Balodi(deceased) was issued by Directorate of Estates, Government of India. Similarly, letter of allotment pertaining to A3 L.Tsering dated 03.06.94 Ex.PW26/F in file D1 was also issued by Directorate of Estates, Government of India. Lastly, the allotment letter of A4 Smt. Krishna dated 03.06.94 in file D2 Ex.PW26/E was also issued by Directorate of Estates, Government of India. These allotment letters clearly shows that the property / shop(s) did not vest with the UDM or MOS(UD), but with the Directorate of Estates, Government of India i.e. the shops vested with the Government of India, as a sovereign. It may be that A1 and A2 recommended for allotment of shops, which were finally approved by A1, who was the final authority for issuance of RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 153 of 194 154 allotment letters pertaining to allotment of shops to A3, A4 and A5, but there was no entrustment as such, nor A1 or A2 could be said to have any dominion of said shops, therefore Section 409 IPC would not be made out.
182. Ld.Spl.PP for CBI Sh. J.S.Wadia has relied upon following judgments in support of his contention regarding Section 409 IPC
1. State of MP vs Veeraswara Rao Agnihotri AIR 1957 SC 592
2. Om Prakash Gupta Vs S.O.UP AIR 1957 SC 458
3. Bikram Singh Vs State 1974 Cri.L.J (Delhi) 418
4. Somnath Puri Vs State of Rajasthan AIR 1972 SC 1490
183. The preposition of law laid down in the aforesaid judgments is not in dispute. However, same is not applicable to the peculiar facts and circumstances of the present case. From the above discussion, Section 409 IPC is not made out, though Section 13(2) r/w Section 13(1)(c) is a separate and distinct offence from Section 409 IPC, but as discussed above since there was no entrustment or misappropriation for the detailed reasons discussed above, Section 13(1)(c) would also not be attracted in the present case.
RC NO. 48(A)/1996
CBI vs. Sheila Kaul & ors. 154 of 194
155
184. Regarding Section 13(1)(d)(iii), the law has been laid down in the following judgments In a case decided by Hon'ble Supreme Court titled M.Narayanan Nambiar Vs State of Kerala 1963(2) Cri.L.J.186, it was held as under:
6. As the first contention turns upon the provisions of S.5(1), it will be convenient to read the same:
5.(1) A public servant is said to commit the offence of criminal misconduct in the discharge of his duty
(a) if he habitually accepts or obtains or agrees to accept or attempts to obtain from any person for himself or for any other person, any gratification (other than legal remuneration) as a motive or reward such as is mentioned in S. 161 of the Indian Penal Code, or
(b) if he habitually accepts or obtains or agrees to accept or attempts to obtain for himself or for any other person, any valuable things without consideration or for a consideration which he knows to be inadequate from any person whom he knows to have been, or to be, or to be likely to be concerned in any proceeding or business transacted or about to be transacted by him, or having any connection with the official functions of himself or of any public servant to whom he is subordinate, or RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 155 of 194 156 from any person whom he knows to be interested in or related to the person so concerned, or
(c) if he dishonestly or fraudulently misappropriates or otherwise converts for his own use any property entrusted to him or under his control as a public servant or allows any other person so to do, or
(d) if he, by corrupt or illegal means or by otherwise abusing his position as public servant, obtains for himself or for any other person any valuable thing or pecuniary advantage.
We are concerned in this case with S.5(1) (d) of the Act. Under that clause if a public servant by corrupt or illegal means or by otherwise abusing his position as public servant obtains for himself or for any other person valuable thing or pecuniary advantage, he will be guilty of criminal misconduct, punishable under S. 5(2) of the Act with imprisonment for a term which shall not be less than one year and which may extend to 7 years, and shall also be liable to fine. The learned counsel contends that clause (d) being a penal provision, shall be strictly construed; and that if so construed, it would only take in cases of direct benefit obtained by a public servant for himself or for any other person from a third party in the manner described therein and does not cover a RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 156 of 194 157 case of a wrongful loss caused to the Government by abuse of his power.
10. ................ . First taking the phraseology used in the clause, the case of a public servant causing wrongful loss to the Government by benefiting a third party squarely falls within it. Let us look at the clause "by otherwise abusing the position of a public servant," for the argument mainly turns upon the said clause. The phraseology is very comprehensive. It covers acts done "otherwise" than by corrupt or illegal means by an officer abusing his position. The gist of the offence under this clause is, that a public officer abusing his position as a public servant obtains for himself or for any other person any valuable thing or pecuniary advantage. "Abuse" means misuse i.e. using his position for something for which it is not intended. That abuse may be by corrupt or illegal means or otherwise than those means. The word 'otherwise' has wide connotation and if no limitation is placed on it, the words 'corrupt', 'illegal', and 'otherwise' mentioned in the clause become surplusage, for on that construction every abuse of position is gathered by the clause. So some limitation will have to be put on that word and that limitation is that it takes colour from the preceding words along with which it appears in the clause, that is to say, something savouring RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 157 of 194 158 of dishonest act on his part. The contention of the learned counsel that if the clause is widely construed even a recommendation made by a public servant for securing a job for another may come within the clause and that could not have been the intention of the Legislature. But in our view such innocuous acts will not be covered by the said clause. The juxtaposition of the word 'otherwise' with the words 'corrupt or illegal means', and the dishonesty implicit in the word "abuse" indicate the necessity for a dishonest intention on his part to bring him within the meaning of the clause. Whether he abused his position or not depends upon the facts of each case; nor can the word 'obtains' be sought in aid to limit the express words of the section. 'Obtain' means acquire or get. If a corrupt officer by the said means obtains a valuable thing or a pecuniary advantage, he can certainly be said to obtain the said thing or a pecuniary advantage; but it is said that in clauses (a) and (c) the same word is used and in the context of those clauses it can only mean getting from a third party other than the Government and therefore the same meaning must be given to the said word in clause (d). 'Obtains' in clauses (a) and (b) in the context of those provisions may mean taking a bribe from a third party, but there is no reason why the same meaning shall be given to that word used RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 158 of 194 159 in a different context when that word is comprehensive enough to fit in the scheme of that provision. Nor can we agree that as dishonest misappropriation has been provided for in clause (c), the other cases of wrongful loss caused to the Government by the deceit practised by a public officer should fall outside the section. There is no reason why when a comprehensive Statute was passed to prevent corruption this particular category of corruption should have been excluded therefrom because the consequences of such acts are equally harmful to the public as acts of bribery. On a plain reading of the express words used in the clause, we have no doubt that every benefit obtained by a public servant for himself, or for any other person by abusing his position as a public servant falls within the mischief of the said clause.
185. It has been further held in a case decided by Hon'ble High Court of Delhi titled Runu Ghosh Vs CBI Crl.A.482/2002, P.Rama Rao Vs CBI Crl.A.509/2002 and Sukh Ram Vs CBI Crl.A. 536/2002 decided on 21.12.2011, as under:
66. This question lies at the core of the reference to this Division Bench. The material portion of the reference, while adverting to Sections 13(1)(d) and then dealing with the RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 159 of 194 160 phraseology of Section 13(1)(d)(iii) and other preceding subclauses, reads thus:
Whether the absence of adverbs like wilfully, fraudulently, dishonestly, corrupt or illegal means to qualify the verb obtains in this clause would mean that a public servant commits criminal misconduct if he while holding such office obtains for any person (and not for himself) any pecuniary advantage which is without any public interest? The statute appears to offer no guidance as to what can be said to be a decision or act that is without public interest.
Though the reference order elaborately lists out the salient facts in the Appeals, notes rival contentions, and even notices relevant case law, it is necessary to recapitulate the pre existing law, i.e. Section 5(1)(d) of the 1947 Act, and juxtapose it with the 1988 Act. The controlling clauses, in both provisions, are in pari materia (a public servant is said to commit the offence of criminal misconduct if he ...). Section 5(1)(d) reads as follows:
(d) if he, by corrupt or illegal means or by otherwise abusing his position as public servant, obtains for himself RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 160 of 194 161 or for any other person any valuable thing or pecuniary advantage...Section 13(1)(d)(i), (ii) and (iii), on the other hand, read thus:
(i) by corrupt or illegal means, obtains for himself or for any other person any valuable thing or pecuniary advantage; or Crl.A.Nos. 482/02, 509/02 & 536/02 Page 45
(ii) by abusing his position as a public servant, obtains for himself or for any other person any valuable thing or pecuniary advantage; or
(iii) while holding office as servant, obtains for any person any valuable thing or pecuniary advantage without any public interest.... It is clear from the above comparison that in clause (i), the reference to "corrupt or illegal" means, (of a public servant obtaining for himself, or someone elseany valuable thing or pecuniary advantage) has been retained. However, the reference to doing of such an act "otherwise" (which was there in the previous law, i.e. Section 5(1)(d) has been omitted. The latter parts of RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 161 of 194 162 Section 5(1)(d), i.e. the public servant obtaining for himself or for any one else any valuable thing or pecuniary advantage, by abusing his position as a public servant has been retained, in Section 13(1)(d)(ii).
A new offence (or subspecies, of the existing offence) has been carved out, in Section 13 (1)
(d)(iii) which criminalizes, as "criminal misconduct" the act of a public servant, holding office, which results in someone else (any person) benefitting by getting a valuable thing or pecuniary advantage, without any public interest. There is no doubt that Parliament created this new offence of criminal misconduct, where abuse of office, or use of corrupt or illegal means by a public officer, is inessential to prove the crime. What the prosecution has to establish, in accordance with law, is that the public officer, obtained for someone elsenot necessarily by abusing his office, or using corrupt or illegal means pecuniary advantage or a valuable thing without public interest.
79. What then is the behaviour or act which attracts such opprobrium as to result in criminal responsibility? It is not every act which results in loss of public interest, or that is contrary to public interest, that is a prosecutable offence. There can be no doubt RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 162 of 194 163 that all acts prejudicial to public interest, can be the subject matter of judicial review. In those cases, courts consider whether the decision maker transgressed the zone of reasonableness, or breached the law, in his action. However, it is only those acts done with complete and manifest disregard to the norms, and manifestly injurious to public interest, which were avoidable, but for the public servants overlooking or disregarding precautions and not heeding the safeguards he or she was expected to, and which result in pecuniary advantage to another that are prosecutabe under Section 13(1)(d)(iii). In other words, if the public servant is able to show that he followed all the safeguards, and exercised all reasonable precautions having regard to the circumstances, despite which there was loss of public interest, he would not be guilty of the offence. The provision aims at ensuring efficiency, and responsible behaviour, as much as it seeks to outlaw irresponsibility in public servants functioning which would otherwise go unpunished. The blameworthiness for a completely indefensible act of a public servant, is to be of such degree that it is something that no reasonable man would have done, if he were placed in that position, having regard to all the circumstances. It is not merely a case of RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 163 of 194 164 making a wrong choice; the decision should be one such as no one would have taken.
81. As noticed previously, the silence in the statute, about the state of mind, rules out applicability of the mens rea or intent standard (i.e. The prosecution does not have to prove that the accused intended the consequence, which occurred or was likely to occur). Having regard to the existing law Section 13(1)(e) (which does not require proof of criminal intent) as well as the strict liability standards prevailing our system of law, therefore, a decision is said to be without public interest, (if the other requirements of the provision, i.e. Section 13(1)(d)(iii) are fulfilled) if that action of the public servant is the consequence of his or her manifest failure to observe those reasonable safeguards against detriment to the public interest, which having regard to all circumstances, it was his or her duty to have adopted.
186. Regarding the offence u/S 13(1)(d) of the PC Act 1988, in view of the law as laid down by Hon'ble High Court of Delhi in Runu Ghosh (supra), it is to be seen whether the prosecution has been able to prove offence u/S 13(1)(d)(iii) of PC Act which criminalizes criminal misconduct of a public servant holding public post which results in somebody else i.e. any person benefiting by RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 164 of 194 165 getting a valuable thing or pecuniary advantage without any public interest and the prosecution has to establish to prove the said offence that the public officer obtained for someone else not necessarily by abusing his office or using corrupt or illegal means pecuniary advantage or a valuable thing without any public interest. It has been further held in the said judgment that it is not every act which results in loss of public interest or that is contrary to public interest, which is prosecutable offence. It is only those acts done with complete and manifest disregard to the norms and manifestly injurious to public interest which is avoidable, but for the public servants overlooking or disregarding precautions and not heeding the safeguards he or she was expected to, which resulted in pecuniary advantage to another is prosecutable u/S 13(1)(d)(iii). In other words, if public servant is able to prove or show that he followed all the safeguards and exercised all reasonable precautions taking into account the circumstances, despite which there was loss of public interest, he would not be guilty of the offence. In the said judgment, in Para 82 some instances of the same have been given. The said Para 82 is reproduced as under:
82. It would be useful to in this context, take RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 165 of 194 166 recourse to certain examples. For instance, in not adopting any discernable criteria, in awarding supply contracts, based on advertisements calling for responses, published in newspapers having very little circulation, two days before the last date of submission of tenders, which result in a majority of suppliers being left out of the process, and the resultant award of permits to an unknown and untested supplier, would result in advantage to that individual, and also be without public interest, as the potential benefit from competitive bids would be eliminated. Likewise, tweaking tender criteria, to ensure that only a few applicants are eligible, and ensure that competition (to them) is severely curtailed, or eliminated altogether, thus stifling other lines of equipment supply, or banking on only one life saving drug supplier, who with known inefficient record, and who has a history of supply substandard drugs, would RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 166 of 194 167 be acts contrary to public interest. In all cases, it can be said that the public servant who took the decision, did so by manifestly failing to exercise reasonable proper care and precaution to guard against injury to public interest, which he was bound, at all times to do. The intention or desire to cause the consequence may or may not be present; indeed it is irrelevant; as long as the decision was taken, which could not be termed by any yardstick, a reasonable one, but based on a complete or disregard of the consequence, the act would be culpable.
187. Here also, the allotment of shops to A3, A4 and A5 by not adopting the criteria of OM of 1979 i.e. by going for public auction/open public tender which resulted in many other persons similarly situated being left out from the consideration zone and which resulted in allotment of shops to A3, A4 and A5, who were either family member or were having some sort of connections in the Ministry with A1 (deceased) or A2 and the fact that the two other shops were alloted at a very strategic location i.e. P.G.Market RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 167 of 194 168 (Lajpat Rai market) which was just opposite Red Fort near the commercial hub of Chandni Chowk, cannot be said to be in public interest. The said recourse severely curtailed or eliminated altogether the participation of other public persons in the auction, therefore the decision of allotment of shops in favour of A3, A4 and A5 cannot be said to have been taken by exercising reasonable or proper care and precaution to guard against the public interest which A1 and A2 being the Cabinet Minister and MOS were bound to follow, being repository of public trust and faith.
188. As already discussed above, in the note dated 23.12.93 Ex.PW26/A, it was clearly mentioned that the shops in P.G.Market i.e. Lajpat Rai Market, the ownership rights had already been conferred, therefore any allotment could have only been done by public auction. Same was the observation made in note Ex.PW11/B dated 31.12.93 as well as in the note of then Secretary, UD dated 18.01.94 Ex.PW28/B, as also in the note Ex.PW15/B dated 04.05.94 in which it was stated that it was the first time that UDM had made allotment of shops in a rehabilitation market (P.G.Market i.e. Lajpat Rai market) where government had already conferred ownership rights. It was also noted that since 1964, they had not revised the economic licence fee of rehabilitation markets, although in other RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 168 of 194 169 markets the revision of licence fee had been done thrice after 1985. Similarly, in the note Ex.PW15/A, though it was stated that the previous UDM had also allotted 15 shops in 1989, as per exception clause3 of OM of 1979, but even at that time the same was dissented by JS (Finance) noting that the wholesale exception will tend to make it as a rule rather than an exception, but the said objection was not considered and the then UDM went ahead with the allotment(s).
189. In the said note Ex.PW15/A, it was pointed out that purely from the financial point of view, PG Market was situated at the heart of Delhi, just opposite Red Fort and it was hub of commercial activity and because of this, if the two shops were to be disposed off through public auction, it will earn for government quite a handsome amount of revenue and it was also mentioned that some shops were also put on tenders in some other markets in the control of Directorate of Estates in years 1987, 1988 and 1994 which were 133 INA market, 51 SectorVIII R.K.Puram, 148 Ring Road market and 31 Andrews Ganj, and it was observed that the shops mentioned therein attracted quite a good amount of tender amount in each case. Therefore, if the two shops at the P.G.Market were also allotted on tender basis, it would fetch more amount than the RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 169 of 194 170 four shops mentioned above and it will be observed that the shop at INA market was alloted in year 1988 for a sum of Rs.3,100/, Sector VIII, R.K.Puram in year 1987 for a sum of Rs.4,672/, Ring Road market in year 1994 for a sum of Rs.4,005/ and lastly Andrews Ganj in year 1994 for a sum of Rs.2,700/.
190. Therefore, despite the note dated 05.05.94 Ex.PW15/A, the said objection was not at all considered which was made by the Finance Division of Urban Development Ministry, yet in utter disregard to the said objection, A1 (deceased) on the recommendation of A2 went ahead and allotted two shops bearing nos.85 and 405 to A4 and A3 respectively on regular basis on payment of licence fee vide order dated 12.05.94 signed by A2 and that of A1 (deceased) dated 16.05.94, who concurred with order for the issuance of allotment letters.
191. In fact, a note was also made by JS and FA (UD) Sh.Girish Bhandari Ex.PW15/DA that the Directorate of Estates has mentioned that the allotment of shops was to be done by auction, therefore there was a departure from existing policy, therefore one option could be to allot shops in any of the other areas where 15 shops were allotted in 1989, but since it appears that A1 and A2 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 170 of 194 171 were in a hurry to allot the shops to their known persons by not adhering or considering the objections made by various officers of the Urban Development Ministry as well as by the Finance Division and finally the allotment letters were issued to A3 and A4. For example A4 was alloted shop no.85, P.G Market at a paltry licence fee of Rs.298/ per month vide letter Ex.PW26/E. Similarly, A3 was alloted shop no.405, P.G.Market vide letter dated 03.06.94 Ex.PW26/F at a monthly licence fee of Rs.291/ and that of A5 (deceased) was allotted shop no.2, Hanuman Road, New Delhi vide allotment letter Ex.PW26/G at a paltry licence fee of Rs.596/ per month.
192. Judicial notice of this fact can be taken that shop at Hanuman Road which is situated next to Cannaught Place, is also very strategically placed, since it is a hub of commercial activity, same would have also fetched handsome amount of revenue to the Government, rather it was allotted to A5 at a paltry amount of Rs. 596/ for the reasons best known to A1 and A2.
193. Though, A5 has expired, yet it is relevant to discuss that, though the process of allotment of shops to A3 and A4 went through various layers of bureaucratic channels i.e. official notings RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 171 of 194 172 and contrary notings were made by Desk Officer, Joint Secretary, Secretary, Director and UDM and matter was also dealt with by Finance Division of the Urban Development Ministry, as the opinion of Finance Division was also sought, but in the case of A5, no such thing was done. In fact, it appears that a note was put regarding the allotment on 30.03.94 vide note Ex.PW10/DC, though observing that the market at Hanuman Road had also to be disposed off by auction by L&DO after fixing the reserve price in consultation with the Finance Division, as per OM of 1979, yet all these objections were not taken into consideration and a note was put up for allotment of the shop at Hanuman Road in favour of A5 and on the same day, the matter proceeded at a lightening speed and it was approved by the Secretary on 30.03.94 itself and finally by UDM on 09.04.94. It is not clear who received application and from whom.
194. Thereafter the allotment letters were issued and it would be worthwhile to note that A5 was none else, but wife of PW16 Sh.Prem Ballabh Balodi, who at the relevant time was working in the personal staff of then Prime Minister of India. Neither detailed notes were made nor official concurrence or the opinion of Finance Division was taken, rather it appears that same was a case of fait RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 172 of 194 173 accompli, as probably all the bureaucrats of the Urban Development Ministry were full aware that the said allotment had to be made without any demur or protest, therefore there was no point in raising any objection, therefore the application of A5 did not pass through the layers of notings of Secretary or any other Senior Officers in the Urban Development Ministry as well as Finance Division, as was done atleast in the case of A3 and A4. Rather, it appears that on the receipt of application, the allotment was done on the same day to A5. This undue, haste also leads to the conclusion that all norms were set aside for making the said allotment, come what may.
195. Regarding the contrary argument of Ld. defence counsel Sh.S.P.Minocha that the shops in question could not be disposed off by public auction despite repeated steps taken by the Government, as the reserve price was too high, therefore no bidder came forward, which has been admitted by numerous prosecution witnesses examined on the record. There was even a proposal for transfer of these shops to local bodies, but they were also not ready to accept the same except free of cost. Thereafter, the matter was pending for refixation of reserve price, as reserve price was very high. He has RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 173 of 194 174 also argued that it has been admitted by many prosecution witnesses that the shops in question were lying in a dilapidated condition for a very long time, rather were causing loss to the government on account of repair and loss of revenue. He further argued that allotments of 15 shops was similarly made by the previous UDM in year 1989, as per clause3 of the exception clause of OM of 1979 and further, the shops in question had been allotted without prescribing any period of leave and licence with the condition that the government reserves its right to cancel the licence and lease, take possession of shops after giving 30 days notice and all the allottees had also given an undertaking in this effect. Therefore, he has argued that what infraction of law or norms A1 or A2 had done in the present case.
196. This argument of Ld. defence counsel for A1 is without any substance for the reasons already discussed above. Merely because many shops had been earlier allotted by the previous UDM out of turn without following the norms of auction/tender as per clause3, does not mean that the present allotment is also right, as two wrong do not make it right, though it is further said in light vain three rights make a left, but the fact remains wrong doings cannot be undone by doing something else wrong. Merely because the said RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 174 of 194 175 earlier allotment made by the previous UDM in 1989 was not challenged, does not mean that there is no illegality or infirmity in the present allotment(s). It would not be out of place to mention that in the note Ex.PW15/A made by the Finance Division with regard to the proposal of allotment of shops to A3 and A4, it was observed that at the time of allotment of 15 shops by the previous UDM, the then Joint Secretary (Finance) had also seriously objected to it observing that the said wholesale exception would tend to make it as a rule rather than exception. Therefore, it is not that at that time none had objected to recourse to the exception clause3 by the then UDM for allotment of 15 shops. The present case allotment(s) of three shops is also distinguishable from the allotment of 15 shops by the earlier UDM, which were made in new government colony markets, which were newly constructed. They were not having strategic location as well as economic condition, as was in this case, as the two shops were allotted in P.G.Market (Lajpat Rai Market), opposite Red Fort, whereas the third shop was alloted in Hanuman Road next to commercial heart of Delhi, Connaught Place. Therefore, pecuniary loss caused to the State Exchequer has been immense due to indiscriminate acts of A1 and A2.
197. Further, PW20 K.D.Singh (corrected as PW21 vide RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 175 of 194 176 ordersheet dated 15.05.13) has deposed that after the directions of Hon'ble Supreme Court, they had called tender(s) for various shops/stalls and rates would have been quoted therein, on this basis comparative statement was prepared by the Directorate of Estates. The said comparative statement is Ex.PW20/1 (again corrected as Ex.PW21/1). Perusal of said record would reveal that the said shop no.2 which was allotted to Smt.Tulsi Balodi(A5)(deceased) at Hanuman Road, Connaught Place, was allotted to the highest bidder, which invited a tender of Rs.9,000/ per month. The next two bidders of the said shop was Rs.8,000/ each and the last was Rs. 7,100/, whereas the said shop had been allotted to A5 at a paltry amount of Rs.596/ per month. Therefore, there was huge pecuniary loss to the State Exchequer and the same resulted in huge pecuniary advantage to A5 without any public interest. The same cannot be said to be in public interest.
198. Though, no comparative statement of the auction of shop nos.85 and 405 have been placed on the record after the cancellation of allotments by the Hon'ble Supreme Court, but judicial notice of this fact can be taken that the said shops would have fetched more revenue due to even more strategic location of these shops, next to Chandni Chowk, especially when ownership rights RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 176 of 194 177 had been conferred in respect of said shops, therefore pecuniary loss to the State Exchequer and pecuniary advantage to A3 and A4 can well be imagined.
199. Abraham Lincoln said in his famous quote:
" Nearly all men can stand adversity, but if you want to test a man's character, give him power."
200. The Ministers are repository of power of people, which people have given them by electing them. They look upon them for amelioration of their condition, not to betray them by squandering meagre resources of the nation, further as said by father of nation Sh.Mahatma Gandhi : ' The world has enough for everyone's need, but not enough for everyone's greed'
201. Greed of man is insatiable, but people in high places especially Ministers should lead by example, as the whole nation and society look upon them for emulation, so that the faith of the people in democracy and rule of law remain unflinched, which are the basic structure of our constitution.
202. The famous poet folk rock singer Bob Dylan ( it is often RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 177 of 194 178 said, he was the true voice of American spirit) aptly wrote in his epic song album 'The Times They are A changin' released in 1964 with regard to American political society at that time * 'Come Senators, Congress man Please heed the call Don't stand in the doorway Don't block up the hall for he that gets hurt will be he who has stalled There's a battle outside and it is ragin it'll soon shake your windows and rattle your walls for the times they are a chang in' (* a excerpt from said song)
203. Now, as already discussed above in detail that the allotment(s) of present shops to A3, A4 and A5 (deceased) was most unfair, arbitrary and in violation of Article 14 of Constitution of India, as no criteria or classification was made for allotting the shops to a particular person or a class of persons, rather the same were made in blatant violation of all established norms of allotment(s) by following favouritism and nepotism.
204. Since acts of A1 (deceased) and A2 being Public servants resulted in pecuniary advantage or getting valuable thing in favour of A3 and A4 and A5 (deceased) in terms of allotment of RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 178 of 194 179 shops by abusing their official position, which was clearly against any public interest.
205. Therefore, there was a clear cut conspiracy between A1(deceased) and A2 for committing the illegal act or to commit the offence punishable u/S 13(1)(d)(iii) r/w Section 13(2) of the PC Act. Since A1 has already expired and the proceedings against her has stood abated, therefore only A2 stands convicted u/S 120B IPC r/w Section13 (1)(d)(iii) r/w Section 13(2) of PC Act, 1988. However, (A3) L.Tsering and (A4) Smt. Krishna are acquitted of the charge(s) under Section 120B r/w Sec.409 IPC and 13(2) r/w Sec.13(1)(c) and 13(1)(d) of PC Act. (A5) Tulsi Balodi has also expired and proceedings against her stood abated vide order dated 21.08.14.
ANNOUNCED IN THE OPEN COURT ON 24.02.2016 (SANJEEV AGGARWAL) Special Judge, CBI03(PC Act) Delhi/24.02.2016 RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 179 of 194 180 IN THE COURT OF SH. SANJEEV AGGARWAL:
SPECIAL JUDGE: CBI03 (PC ACT): DELHI CC No.12/15 RC : 48(A)/1996 PS : CBI/ACB/ND U/s : 120B r/w Sec. 13(2) r/w Sec.
13(1)(d)(iii) of PC Act, 1988.
CBI Vs. (1) P.K.Thungon
S/o Sh.P.W.Thungon
Formerly Minister of State in the M/O UA&E, ND R/o flat no.7, Yashwant Place, New Delhi Permanent address Thungon House, Bomdila, West Kameng District, Arunanchal Pradesh.
ORDER ON SENTENCE
1. Vide judgment dated 24.02.2016 (A2) P.K.Thungon was convicted u/S 120B IPC r/w Section13 (1)(d)(iii) r/w Section 13(2) of PC Act, 1988.
2. I have heard Sh. J.S.Wadia, Ld PP for CBI and Ld. Defence counsels for A2 Sh. S.P.Minocha and Sh. Gagan Minocha.
3. Ld. counsels for the convict Sh. S.P.Manocha and Sh.
Gagan Manocha have filed an affidavit in support of mitigating circumstances, as well have addressed their oral arguments stating that convict is aged 70 years of age at present. He is a RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 180 of 194 181 scheduled tribe belonging to Arunachal Pradesh. The wife of the convict is suffering from acute liver decease for which she is taking regular treatment. It is also stated that his wife had also suffered a brain stroke and she had also undergone the surgery, which has severally effected her mobility.
4. It is further stated that his two sons are settled in Arunachal Pradesh and only one son is temporarily staying in Delhi and therefore the convict is the only person to look after his wife emotionally as well as physically.
5. It is also stated that even as per the allegations of the prosecution there is no element of bribery involved in the present case. The convict had only recommended the case of L. Tsering and Smt. Krishna on compassionate grounds. It is also stated that the convict is actively associated with various social organizations and he has extensively contributed for the betterment of Arunachal Pradesh by doing various good deeds. It is also stated that he has already faced trial for 18 years. Therefore leniency be shown to him in awarding sentence to him. It is also stated that the convict is in custody in another case from 21.07.15. Therefore benefit may be accorded to him U/s 427/428 Cr.P.C. He has also relied upon the following judgments in RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 181 of 194 182 support of his contentions:
(i) 2011(2) C.C. Cases(HC) 126 titled as Ram Rattan Vs. State through Central Bureau of Investigation
(ii) Crl. Appeal No. 404 of 2014 titled as V.K.Verma Vs. CBI
6. On the other hand, Ld. Spl. PP for CBI has refuted the aforesaid arguments of Ld. counsel for the convict, stating that severe punishment be granted to the convict, as he had abused his official position as a public servant by corrupt means and thereby obtained pecuniary advantage in favour of certain allottees who were either his close relatives or were very close to him or to the then UDM Smt. Shiela Kaul. He has further argued that no leniency can be shown to the Ministers who occupy high pedestal(s) of public office, and yet violate the trust reposed in them by the public. He has also argued that the convict has already been convicted in another case for corruption, wherein he has been sentenced for 4 ½ years R.I. Therefore it is prayed that considering his past record no ground for leniency is made out.
7. I have gone through the rival contentions and perused the RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 182 of 194 183 affidavit filed by the convict as well as the judgments relied upon by the Convicts (SUPRA)
8. Counsel for convict has also relied upon the judgment dated 25.04.1978, decided by Hon'ble High Court of Delhi tilted as K.C. DASS, N.K.CHATERJEE VS. STATE OF DELHI CRLJ19790362/DLT19781416/ILR (DEL)19782341, the relevant para(s) of the same are reproduced as under:
2. THESE are three petition for habeas corpus. The point raised in all of them is the same. It is a point of principle. It relates to set off the period of detention undergone by the accused under s. 428 of the Criminal Procedure Code, 1973.
The three accused in the three writ petitions were convicted of crimes in more cases than one. They were awarded separate sentences at different times. Each of the accused was arrested in one case to begin with and thereafter he was also placed under arrest at different times in other cases. This means that formally he was put under arrest in other cases, though he was already in detention.
Take a simple illustration. An accused is RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 183 of 194 184 arrested in one case on 11977. He is arrested in another case on 111978, while the trial of the first case is proceeding. In the first case he is convicted and sentenced on 3111978 to two years imprisonment. Under S. 428 the accused will be entitled to set off his period of detention from 111977 to 3111978 against the term of imprisonment imposed on him in the first case. This legal position is incontestable.
To take the illustration further, suppose in the second case the accused is convicted on 31378 and sentenced to three years imprisonment. Now the accused claims that he is entitled to set off the pretrial detention in the second case as well. In other words he claims that the period of detention from 111977 to 3131978 be set off against the sentence of imprisonment imposed on him in the second case. The short question is : Is he entitled to set off the period of detention against his sentence in the second case though he had the benefit of s. 428 once in the first case? The Delhi Administration opposes these petitions. Counsel for the Administration submitted that the accused person is entitled to set off in the second case only RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 184 of 194 185 upto the date of conviction in the first case as the period of detention undergone by the accused in prison after conviction was being undergone under the sentence imposed in the first case and not during the investigation, inquiry or trial of the second case.
S. 428 of the Code lays down the rule of "set off". It reads :
"Where an accused person has, on conviction, been sentenced to imprisonment for a term, the period of detention, if any, undergone by him during the investigation, inquiry or trial of the same case and before the date of such conviction, shall be set off against the term of imprisonment imposed on him on such conviction, and the liability of such person to undergo imprisonment on such conviction shall be restricted to the remainder, if any, of the term of imprisonment imposed on him."
On a truand interpretation of the section it appears to us that in the second case also in which the accused person was convicted on 31 March, 1978 he will be entitled to set st off the period of pre trial detention i.e. 1 st January, 1977 to 31 March, 1978 against st the sentence of three years imposed on RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 185 of 194 186 him. The status does not make any distinction between the first case and the second case. The principle is the same. It has to be applied to all cases even handedly and uniformly.
The key words of the section are "the period of detention, if any, undergone by him during the investigation, inquiry or trial of the same case and before the date of such conviction". This "period of detention" shall be set off against the term of imprisonment imposed on him on conviction. The liability of such person to undergo imprisonment shall be restricted to the remainder of the term of imprisonment imposed on him.
The words "of the same case" are important. The section speaks of the "period of detention" undergone by the accused person, but it expressly says that the detention mentioned refers to the detention during the investigation, inquiry or trial of the case in which the accused person has been convicted. The section makes it clear that the period of detention which it allows to be set off against the term of imprisonment imposed on the accused on conviction must be during the investigation, inquiry or trial of the case in RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 186 of 194 187 which the accused person has been convicted. The section makes it clear that the period of detention which it allows to be set off against the term of imprisonment imposed on the accused on conviction must be during the investigation, inquiry or trial in connection with the "same case" in which he has been convicted. (See Government of P.P. v. A.V. Rao, AIR 1977 SC 1097 (1100) (1).
S. 428 provides that the period of detention of an under trial prisoner shall be set off against the term of imprisonment imposed on him on conviction. Will it not be true to say that the accused is an under trial prisoner in the second case in our illustration. It it is so he will be entitled to set off his pre conviction period against the term of imprisonment imposed on him in the second case as in the first. We see no ground to deny him the benefit in the second case.
The provision as to set off expresses a legislative policy (See Government of A.P. Supra). We sit here to carry out the will of Parliament. The Supreme Court has said :
"S428 is absolute in its terms. It provides for set off the preconviction detention of RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 187 of 194 188 an accused person against the term of imprisonment imposed on him on conviction"
(B. P. Andre v. Supdt. Central Jail, AIR 1975 SC 164 (168) (2).
The principle of S. 428 has to be applied in all cases whether the accused is convicted in one case or many, whether simultaneously or at different times. The reason is that in the second case the accused person remains as untried and unsentenced prisoner till his trial is concluded. At the end of the trial he is convicted and sentenced to a term of imprisonment. Before trial is finished he remains an unconvicted person accused of a crime. Nothing more than this. The statute says that if on trial he is convicted and a term of imprisonment is imposed allow him set off of the period of pretrial detention. Therefore, if the accused person is in detention as an unconvicted, untried or unsentenced prisoner and is, on trial, convicted and sentenced to a term of imprisonment he is entitled to set off.
Whether such period of pre trial detention is common to a considerable extent in the two cases is of no consequence to the application of s. 428.
RC NO. 48(A)/1996
CBI vs. Sheila Kaul & ors. 188 of 194
189
3. IF the sentences awarded on conviction are to run concurrently s 427 applies. IF sentences in the two cases in our illustration are not ordered to run concurrently, the remainder of the term of imprisonment, after adjustment of the pre trial period already undergone in the second class, shall commence at the expiry of the term of imprisonment in the first case after setting off the pre trial detention period. In both cases he will be entitled to set off.
The view we take was also taken by one of us sitting singly (v.D. Misra, J.) in two cases : Bahadur Chand v. G.K. Marwaha, Criminal Writ 14 of 1977 decided on 13 th May, 1977(3) and Sunil Kumar v. State Criminal Misc. (Main) No. 2079 of 1975 decided on August 21, 1975(4). A learned single Judge of Rajasthan High Court has also taken the same view in Chella V. State of Rajasthan, 1977 Cr.L.J. 589(5).
A learned single Judge of this Court in K.C. Dass @ N.K. Chatterjee v. State, Cr. Misc. (Main) No. 121 of 1978 decided on March, 10,1978(6) held to the contrary. He held that in the second case the accused person is entitled to set off the period of detention RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 189 of 194 190 upto the date of conviction in the first case. In our illustration, according to the learned Judge he will be entitled to set off from 1 st January, 1977 to 31 January, 1978 and not st upto 31 March, 1978. The learned Judge st thought that on conviction in the first case the accused person was serving the sentence and was not in pretrial detention so far as the second case is concerned. We do not agree with this reasoning. The accused person is in pretrial detention as regard the second case. It is certainly a pre conviction period and the statute operates in his favour.
We have not dealt with the particular facts of each case. We have settled a point or principle. We therefore direct the Superintendent of Jail to compute the period of detention in each of the cases in the light of opinion expressed by us. The petitioners may be informed in jail.
9. In view of the said judgment, which is squarely applicable to the facts of the present case, the convict in the present case will be entitled to set off his detention in J/C during pre conviction period in another case against the term of imprisonment imposed upon him in the present case i.e. to say RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 190 of 194 191 that the period of imprisonment already undergone by him in another case, wherein he had been convicted already, would also be set off from the period of imprisonment imposed in the present case u/S 428 Cr.P.C. The sentence of the convict in this case shall run concurrently with the previous sentence of imprisonment imposed upon him in another case i.e. to say that the convict has been accorded benefit u/S 427 as well as 428 of Cr.P.C.
10. It was said long ago by Lord Acton(18341902) English historian 'Power tends to corrupt and absolute power corrupts absolutely'
10. Then it is also said 'Power does not Corrupt People, People Corrupt Power' - William Gaddis
11. Either way the fact remains that power is no blessing in itself, except when it is used for benefit of common man. The Ministers are the sole repository of the power of the people, which they have reposed in them,for their amelioration, with power comes great responsibility for exercise of said power. It RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 191 of 194 192 is a two edged sword, if not used correctly, it can slay the wielder. Then there is a perception amongst man on the street.
"Steal a little, and they put you in jail, steal a lot and they make you king" Bob Dylan(from the song album 'Sweet heart like you')
12. This perception though not right, has to be demolished, so that there is transparency in Governance for the people, for whom it is meant, those who wield power, must be held accountable for it. They cannot exercize power of people, arbitrarily for their own ends, or for a favourite few by corrupt means, it has to be eradicated as it has tendency to multiply, as all vices do, it is often said "Corruption is like a ball of snow, once it's set a rolling it must increase' -Charles Caleb Colton, English Cleric, writer and collector(17801832)
13. Though sometimes latitude can be shown to a person who commits the crime due to poverty or passion, but not to a person who in zenith of public position abuses his power for corrupt means in detriment to just expectations of the nation and society. Severe punishment has to be visited upon these puissant public servants, so that others who are waiting in the wings or those RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 192 of 194 193 who have already accomplished the fait accompli shiver, while thinking about the consequences of any such wrong doing while occupying such high public positions. In this context, I would quote very beautiful COUPLET OF BAHADUR SHAH ZAFAR( Poet king or last mughal emperor of India) ZAFAR AADMI USS KONA JANIYE GA WOH HO KITNA HI SAHABE FAHAMOZAKA JISE AISH MEIN YAADEKHUDA NA RAHI, JISE TAISH MEIN KHAUFEKHUDA NA RAHA (call him not a man ZAFAR HOWSOVER WISE, WHO, IN JOY FORGETS HIS LORD, IN RAGE RESPECTS NO QUALMS)
14. In these circumstances, the judgment relied upon by the Ld. counsel for the convict (Supra) praying for lenient punishment is not available to the convict in the peculiar facts and circumstances of the present case. As a resultant, the interest of justice shall be met if the convict is sentenced to a rigorous imprisonment of 3 ½ years and also fine of Rs.1 Lakh, in default of payment of fine SI for 6 months u/S 13(1)(d)(iii) r/w Sec. 13(2) of Prevention of Corruption Act, 1988. The convict in the present case will be entitled to set off his detention in J/C during preconviction period in another case against the term of imprisonment imposed upon him in the present case i.e. to RC NO. 48(A)/1996 CBI vs. Sheila Kaul & ors. 193 of 194 194 say that the period of imprisonment already undergone by him in another case, wherein he had been convicted already, would also be set off from the period of imprisonment imposed in the present case u/S 428 Cr.P.C. The sentence of the convict in this case shall run concurrently with the previous sentence of imprisonment imposed upon him in another case i.e. to say that the convict has been accorded benefit u/S 427 as well as 428 of Cr.P.C.
15. Copy of the judgment alongwith order on sentence be given to the convict free of cost. File be consigned to record room.
ANNOUNCED IN THE OPEN (Sanjeev Aggarwal)
COURT ON 29.02.2016 Special Judge,
CBI03 (PC Act)
Delhi/29.02.2016
RC NO. 48(A)/1996
CBI vs. Sheila Kaul & ors. 194 of 194