Jharkhand High Court
Ashok Kumar Singh vs The State Of Jharkhand Through Acb on 28 April, 2022
Author: Anil Kumar Choudhary
Bench: Anil Kumar Choudhary
1 Cr.M.P. No.2153 of 2016
IN THE HIGH COURT OF JHARKHAND AT RANCHI
Cr. M.P. No. 2153 of 2016
Ashok Kumar Singh, son of Late Ram Bilas Singh, resident of Kumar
Niwas, Bright Lane, Kokar, P.O.- Kokar, P.S.- Sadar, Dist.- Ranchi.
.... Petitioner
Versus
1. The State of Jharkhand through ACB, Ranchi
2. Jharkhand Urja Vikas Nigam Ltd. through its Chairman cum
Managing Director, having its office at Engineering Building, H.E.C.,
Dhurwa, P.O. & P.S.- Dhurwa, Dist.- Ranchi
3. Jharkhand Bijli Vitran Nigam Ltd. Managing Director, having its office
at Engineering Building, H.E.C., Dhurwa, P.O. & P.S.- Dhurwa, Dist.-
Ranchi .... Opp. Parties
PRESENT
HON'BLE MR. JUSTICE ANIL KUMAR CHOUDHARY
.....
For the Petitioner : Mr. Pandey Neeraj Rai, Advocate For the A.C.B. : Mrs. Priya Shrestha, Spl. P.P. .....
By the Court:-
1. Heard the parties through video conferencing.
2. This criminal miscellaneous petition has been filed invoking the jurisdiction of this Court under Section 482 Cr.P.C.
with a prayer for quashing the entire criminal proceeding arising out of Vigilance P.S. Case No.02 of 2011, corresponding to Spl. Case No.02 of 2011 registered for the offences punishable under Sections 409/420/467/468/471/477A/120B of Indian Penal Code and under Section 13 (2) read with Section 13 (1) (c)
(d) of Prevention of Corruption Act, 1988 and investigation arising thereto including charge sheet no.28/16 dated 12.04.2016 now pending in the court of Special Judge, A.C.B., Ranchi and for quashing and setting aside the order dated 06.09.2017 passed 2 Cr.M.P. No.2153 of 2016 by the learned Special Judge, A.C.B., Ranchi in Vigilance Case No.2 (A) of 2011 by which cognizance for the offence has been taken by the learned Special Judge, A.C.B., Ranchi.
3. The brief facts of the case is that the petitioner was the Managing Director-cum-Owner of M/s. R.P.C.L. which participated in the tender under package 'D' of A.P.D.R.P. floated by the Jharkhand State Electricity Board. In connection with the tender, the petitioner submitted a forged bank guarantee and in that respect, Dhurwa P.S. Case No.153 of 2005 involving the offence punishable under Sections 467/471/409/ 420/120B of Indian Penal Code was registered and after investigation, charge sheet has been submitted in that case on 30.06.2007 against the petitioner and the co-accused persons. The petitioner was actively involved in criminal conspiracy with the co-accused- officers of the Jharkhand State Electricity Board, which is evident from the signatures made by him in various letters and participation by the petitioner in the meetings. According to N.I.T. (Notice Inviting Tender), Contract and Agreement, M/s. R.P.C.L. was supposed to complete the work of the said package 'D' within eight months from the date of agreement that is by 26.09.2005 but the company of the petitioner did not complete the work during the stipulated time. On 6th/7th February, 2007, a tripartite meeting was held between the contractor company under the Chairmanship of the then Chairman of the Jharkhand State Electricity Board namely Mr. Shivendu in which the petitioner participated on behalf of M/s. 3 Cr.M.P. No.2153 of 2016 R.P.C.L. along with G.M. of his company and as per the copy of the minutes of the said meeting M/s. R.P.C.L. agreed to complete the work by the extended period of July, 2007 using full force and assured that it would not go for arbitration but M/s. R.P.C.L. did not even start the work by July, 2007. Because of these latches on the part of the contractor-company of the petitioner, the cost of the work which was Rs.28.17 crores, because of price escalation went up to Rs.33 crores. Contrary to its commitment in the said meeting, R.P.C.L. sent a notice for arbitration on 22.12.2006. On 27.12.2006, the then Chief Engineer under the direction of the then Chairman of Jharkhand State Electricity Board- Dr. Shivendu put a notice for contract termination for M/s. R.P.C.L. but the said file did not move till the transfer of Dr. Shivendu and after the transfer of Dr. Shivendu, the co-accused- P.K. Sinha, the then Executive Engineer on 08.06.2007 suo-moto called for the file and made following noting:-
(i) Appointment of sole arbitrator.
(ii) Annulment of L.D. Clause
(iii) Extension of the time period.
It is pertinent to mention that co-accused- P.K. Sinha was subordinate to the Chief Engineer but still he suo-moto called for the said file and made the said noting. The same was approved by the then Chairman Shri Vijay Nayaran Pandey and in this process, ignoring the interest of Jharkhand State Electricity Board, they worked in the interest of M/s. R.P.C.L. and the 4 Cr.M.P. No.2153 of 2016 petitioner was responsible in getting this done as part of the criminal conspiracy. After the arbitrator was appointed, the petitioner in criminal conspiracy with the co-accused- officers of the Jharkhand State Electricity Board ensured that the officers of Jharkhand State Electricity Board produced only those facts by which the company of the petitioner namely M/s. R.P.C.L. would be benefitted and did not place the facts of prohibition of price variation and because of the said acts of the co-accused- officers of Jharkhand State Electricity Board with the petitioner, Jharkhand State Electricity Board suffered a loss of several crores in connivance and conspiracy by the petitioner and the co- accused- officers of the Jharkhand State Electricity Board. It is further alleged that on a particular day that is on 09.03.2009, the co-accused- officers of Jharkhand State Electricity Board paid Rs.4,89,24,788/- from the head of Power Finance Corporation in collusion and conspiracy with the petitioner. Though, there was a clause in the loan fund given by the Power Finance Corporation that the said loan cannot be used for the purpose of payment of price variation bill and for utilizing the fund of Power Finance Corporation by such additional payment, the approval of Government of Jharkhand/Ministry of Power, Government of India was essential but the said process of obtaining the approval was not made in connection of payment of Rs.2,81,81,756/- to the said M/s. R.P.C.L of the petitioner and it was done only because of the active influence and criminal conspiracy of the petitioner with the co-accused- officers of 5 Cr.M.P. No.2153 of 2016 Jharkhand State Electricity Board. It is further alleged that because of the conspiracy involving the petitioner and the officers of the Jharkhand State Electricity Board, the influence of the petitioner was so high on the co-accused officers of the Jharkhand State Electricity Board, that he could manage to get the orders passed in the relevant file by nine different officers including the officers who are the co-accused persons of this case for payment of the said amount to M/s. R.P.C.L. in one day, throwing of the restrictions for not making such payment to the woods. The petitioner in his statement on 06.08.2011 before the then Investigating Officer of the case admitted taking help of the officers of Jharkhand State Electricity Board and the petitioner is the main beneficiary by wrongful gain out of the public fund released in favour of M/s. R.P.C.L. It is further alleged that on 17.02.2009 Rs.4,89,24,788/- was made to M/s. R.P.C.L. without the approval of the Board/Chairman of the Jharkhand State Electricity Board though for payment of any amount more than Rs.3,00,00,000/-, the concurrence of the Board/Chairman basing upon the concurrence of the Finance was required but the same was ignored and the said payment was made in an arbitrary manner in violation of the Rule 74 of the Jharkhand Finance Rules, Part- 1 which prohibits the post-facto approval and in violation of these rules, post-facto approval was given for such payment. Though the committee upon inspection of the said site assessed the value of work done to be 19,85,08,406/- yet actual payment of Rs.32,16,85,120/- was made and this was done in 6 Cr.M.P. No.2153 of 2016 active connivance and conspiracy of the petitioner with the co- accused- officers of the Jharkhand State Electricity Board with the petitioner. The co-accused- officers of the Board did not pay any heed to the progress of work but concentrated their attention towards payment of money to M/s. R.P.C.L. and only because the inspection of the work was not done by the co- accused- officers of the Jharkhand State Electricity Board within the stipulated time, hence, the work could not be completed within the stipulated time; which was used as a plea for making payment to M/s. R.P.C.L. In the work agreement and work order, there was prohibition of price escalation but the said fact was suppressed by the co-accused- officers of the Jharkhand State Electricity Board and they represented that there is no provision of price variation in the agreement instead of indicating that there was in fact, prohibition for price escalation and because of this wrong representation, appeal was not filed against the award of the arbitrator before release of money but only after payment of money after a long delay, appeal was filed which was dismissed being barred by time.
4. It is submitted by Mr. Pandey Neeraj Rai, learned counsel for the petitioner that the company of the petitioner was paid the money on the basis of the award passed by the Arbitrator who was duly appointed at the request of the company of the petitioner as per the arbitration clause in the contract and the learned Arbitrator has rightly held that as the delay was due to the laches on the part of Jharkhand State Electricity Board, so, in 7 Cr.M.P. No.2153 of 2016 terms of the settled principle of law, the Arbitrator awarded some amount in respect of price escalation also. It is next submitted by the learned counsel for the petitioner that the matter was handed over to C.B.I. for investigation vide a common order dated 28.03.2011 in C.W.J.C. No.1793 of 2001 along with W.P. (PIL) No.4611 of 2009 and W.P. (PIL) No.2918 of 2010 and pursuant to the said order and the order passed by this Court on 11.04.2011, the Secretary, Jharkhand State Electricity Board requested C.B.I. to investigate the Vigilance case pertaining to APDRP, Jamshedpur and after investigation on the matter, C.B.I. submitted a report dated 16.11.2011 mentioning that no illegality was found on the part of the officers of Board. It is next submitted by the learned counsel for the petitioner that this Court while upholding the validity of the arbitration clause of the contract by its order dated 22.01.2016 in Arbitration Application No.8 of 2013 appointed an Arbitrator to adjudicate the dispute between the parties. Hence, there is no criminality on the part of the petitioner in release of the fund by the Jharkhand State Electricity Board in favour of M/s. R.P.C.L. It is further submitted by the learned counsel for the petitioner that the investigation of the case has not been properly done by the A.C.B. and charge sheet has been submitted against the petitioner. It is next submitted that some of the co-accused persons who have been discharged from the allegation of excess payment, yet it has been alleged that the petitioner has received excess payment and owing to the instant criminal proceeding 8 Cr.M.P. No.2153 of 2016 various payments of the petitioner has been withheld by the respondent company and the petitioner has been blacklisted on the ground of charge sheet. Mr. Pandey Neeraj Rai, learned counsel for the petitioner relied upon the judgment of Hon'ble Supreme Court of India in the case of K.N. Sathyapalan (Dead) by LRs. v. State of Kerala & Anr., reported in (2007) 13 SCC 43, wherein, the Hon'ble Supreme Court of India has held as under
in paragraph nos.31 and 32 :-
"31. The question which we are called upon to answer in the instant appeal is whether in the absence of any price escalation clause in the original agreement and a specific prohibition to the contrary in the supplemental agreement, the appellant could have made any claim on account of escalation of costs and whether the arbitrator exceeded his jurisdiction in allowing such claims as had been found by the High Court.
32. Ordinarily, the parties would be bound by the terms agreed upon in the contract, but in the event one of the parties to the contract is unable to fulfil its obligations under the contract which has a direct bearing on the work to be executed by the other party, the arbitrator is vested with the authority to compensate the second party for the extra costs incurred by him as a result of the failure of the first party to live up to its obligations. That is the distinguishing feature of cases of this nature and Alopi Parshad case [(1960) 2 SCR 793 : AIR 1960 SC 588] and also Patel Engg. case [(2004) 10 SCC 566] . As was pointed out by Mr Dave, the said principle was recognised by this Court in P.M. Paul [1989 Supp (1) SCC 368] where a reference was made to a retired Judge of this Court to fix responsibility for the delay in construction of the building and the repercussions of such delay. Based on the findings of the learned Judge, this Court gave its approval to the excess amount awarded by the arbitrator on account of increase in price of materials and costs of labour and transport during the extended period of the contract, even in the absence of any escalation clause. The said principle was reiterated by this Court in T.P. George case [(2001) 2 SCC 758]"
And submits that the Hon'ble Supreme Court of India has settled the principle of law that even in the absence of any price escalation clause in the original agreement, the arbitrator is vested with the authority to compensate the aggrieved party for the extra costs incurred by him as a result of the failure of the 9 Cr.M.P. No.2153 of 2016 first party to live up to its obligations but it is fairly submitted by Mr. Pandey Neeraj Rai that in the case of K.N. Sathyapalan (Dead) by LRs. v. State of Kerala & Anr. (supra), the Hon'ble Supreme Court of India has not expressed any view as to whether in case of specific prohibition in the agreement regarding price escalation; whether the arbitrator is vested with the authority to compensate the aggrieved party on the ground of price escalation. It is next submitted by the learned counsel for the petitioner that though the coordinate Bench of this Court by its common judgment dated 06.01.2020 in Cr.M.P. No.1819 of 2016 along with Criminal Revision No.1057 of 2018 has been pleased to dismiss the said criminal miscellaneous petition and the revision application of the co-accused persons namely Satish Chandra Shrivastava and Pushpendra Kumar Sinha but the Hon'ble Supreme Court of India in Special Leave to Appeal (Criminal) No(s).3440 of 2021 arising out of final judgment and order dated 06.01.2020 in Cr. Revision No.1057 of 2018 passed by the said Coordinate Bench vide order dated 08.11.2021 filed by the co-accused Pushpendra Kumar Sinha has issued notice and also passed an order that there shall be stay of prosecution of the petitioner for that case namely Pushpendra Kumar Sinha for the time being. Hence, it is submitted that the petitioner has not done any criminal act and therefore, the entire criminal proceeding including charge sheet no.28/16 dated 12.04.2016 and the order dated 06.09.2017 passed by the learned Special Judge, A.C.B., Ranchi in Vigilance Case No.2 (A) of 2011 by 10 Cr.M.P. No.2153 of 2016 which cognizance for the offence has been taken be quashed and set aside.
5. Mrs. Priya Shrestha, learned Special P.P. on the other hand opposes the prayer for quashing the entire criminal proceeding including charge sheet no.28/16 dated 12.04.2016 and the order dated 06.09.2017 passed by the learned Special Judge, A.C.B., Ranchi in Vigilance Case No.2 (A) of 2011 by which cognizance for the offence has been taken and submitted that there is series of allegations against the petitioner of being in criminal conspiracy with the co-accused- officers of the Jharkhand State Electricity Board of defrauding the said Jharkhand State Electricity Board to the tune of Rs.10.89 crores causing wrongful loss of the said amount to the Jharkhand State Electricity Board part of which is out of the loan fund given by the Power Finance Corporation in violation of the Rules and in the C.A.G. in its Audit Report has also made adverse remarks regarding the same and this was done only because of the connivance and criminal conspiracy between the petitioner as well as with the co- accused- officers of the Jharkhand State Electricity Board. Mrs. Priya Shrestha submits that the fraudulent intention of the petitioner is crystal clear from the very beginning of the tender process as he has deliberately submitted a forged bank guarantee, for which a separate case has been registered in which charge-sheet has already been submitted against the petitioner and the charge sheet submitted in this case do not question the award passed by the arbitrator rather it indicates 11 Cr.M.P. No.2153 of 2016 that the petitioner in criminal conspiracy and collusion with the co-accused -officers of the Jharkhand State Electricity Board ensured that huge amount of money from the coffers of the Jharkhand State Electricity Board is siphoned out; by ensuring that the co-accused -officers of the Jharkhand State Electricity Board act detrimental to the interest of the Jharkhand State Electricity Board and to act in support of the company of the petitioner, in order to cause wrongful gain to the company of the petitioner, by not placing the facts which were favouring the Jharkhand State Electricity Board before the arbitrator. It is next submitted that hence in view of this serious allegation against the petitioner, the criminal proceeding ought not be quashed at the nascent stage as the Hon'ble Supreme Court of India has deprecated such practice of quashing of the entire criminal proceeding at the nascent stage before consideration of the charge and in this respect, the learned Spl. P.P. relied upon the order of the Hon'ble Supreme Court of India in the case of Central Bureau of Investigation Vs. Sanjiv Paul in Criminal Appeal No. 67 of 2017 arising out of SLP (Crl.) No. 9590 of 2013 dated 10.01.2017, paragraph nos. 3 & 4 of which reads as under:-
"3. On due consideration, we are of the view that the stage at which the High Court had quashed the proceedings was not appropriate. We, therefore, interfere with the order of the High Court but leave it open to the respondent-accused to seek discharge before the learned trial Court. All questions are left open to be urged before the learned trial Court.
4. Appeal, consequently is disposed of in terms of the above." 12 Cr.M.P. No.2153 of 2016
Hence, it is submitted by Mrs. Priya Shrestha that this criminal miscellaneous petition being without any merit be dismissed.
6. Having heard the submissions made at the Bar and after going through the materials in the record, this Court finds that there is specific allegation against the petitioner of being in criminal conspiracy with the co-accused-officers of the Jharkhand State Electricity Board depriving the Jharkhand State Electricity Board of Rs.10.89 crores; after the earlier Chairman of the Board namely Dr. Shivendu was transferred. True it is that the award has been passed by two arbitrators in favour of the company of the petitioner but it is alleged that such award was the result of the officers of the Jharkhand State Electricity Board, in criminal conspiracy and collusion with the petitioner acting detrimental to the interest of the Jharkhand State Electricity Board with an intention to cause wrongful gain to the company of the petitioner. Further there is allegation of fradulent intention of the petitioner since the beginning is apparent from his submitting a forged bank guarantee in connection with this tender for which a separate criminal proceeding is going on.
7. Under such circumstances, this court is of the considered view that this is not a fit case where the entire criminal proceeding arising out of Vigilance P.S. Case No.02 of 2011, corresponding to Spl. Case No.02 of 2011 and investigation arising thereto including charge sheet no.28/16 dated 12.04.2016 now pending in the court of Special Judge, A.C.B., Ranchi and 13 Cr.M.P. No.2153 of 2016 for quashing and setting aside the order dated 06.09.2017 passed by the learned Special Judge, A.C.B., Ranchi in Vigilance Case No.2 (A) of 2011 by which cognizance for the offence has been taken by the learned Special Judge, A.C.B., Ranchi or in part thereto is to be quashed.
8. Accordingly, this criminal miscellaneous petition being without any merit is dismissed.
(Anil Kumar Choudhary, J.) High Court of Jharkhand, Ranchi Dated the 28th April, 2022 AFR/Sonu-Gunjan/-