Allahabad High Court
Jai Ram Lal Verma vs State Of U.P. Thru. C.B.I., A.C.B., Lko. on 5 December, 2022
Author: Dinesh Kumar Singh
Bench: Dinesh Kumar Singh
HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH Court No. - 10 A.F.R. Case :- APPLICATION U/S 482 No. - 3088 of 2022 Applicant :- Jai Ram Lal Verma Opposite Party :- State Of U.P. Thru. C.B.I., A.C.B., Lko. Counsel for Applicant :- Himanshu Raghave Counsel for Opposite Party :- Anurag Kumar Singh Hon'ble Dinesh Kumar Singh,J.
1. Heard Mr. Himanshu Raghave, learned counsel for the accused-applicant, as well as Mr. Anurag Kumar Singh, learned counsel for the respondent - Central Bureau of Investigation (hereinafter referred to as the "CBI") and gone through the record.
2. The present application under Section 482 CrPC has been filed for quashing of the proceedings in Criminal Case No.342/2015, arising out of CBI Case No.RC0062014A007, under Sections 120-B IPC read with Sections 409, 420, 468 and 471 of the Indian Penal Code, 1860 (hereinafter referred to as the "IPC") and Sections 13(2) read with Sections 13(1)(d) of the Prevention of Corruption Act, 1988 (hereinafter referred to as the "PC Act") (State Vs. Jairam Lal Verma and others), pending in the Court of learned Special Judge, A/C, CBI, Court No. 5, Lucknow.
3. Writ Petition No.12802 (M/B) of 2011 came to be filed by one public spirited person, Mr. Sachchidanand Gupta, alleging therein large scale financial bungling, gross irregularities and misappropriation of Mahatma Gandhi National Rural Employment Guarantee Scheme (hereinafter referred to as the "MNREGS") funds in several districts, including Mahoba by Block Development Officers of four blocks, namely, Charkhari, Kabrai, Jaitpur and Panwari in connivance with the officers/officials of Government of Uttar Pradesh and M/s Aman Enterprises, Lucknow. It was held that M/s Aman Enterprises, Lucknow supplied 247 canvas movable work-sheds wroth Rs. 46,95,964/- @ Rs. 19,012/- which was at exorbitant price in four blocks of district Mahoba and thereby a huge wrongly pecuniary loss was caused to the government exchequer and corresponding gain to the government officials and private agencies during the period 2007-2008 and 2009-2009.
4. This Court, vide order dated 31.01.2014, directed the CBI to register a case and investigate the offence. Pursuant to directions of this Court, the FIR in question came to be registered by the CBI.
5. During the course of investigation, the CBI found that the accused-applicant, who was posted as Chief Development Officer in District Mahoba (since retired), while functioning on the said post, entered into criminal conspiracy with co-accused, Raj Kamal Goyal, a private person, Anil Kumar Jaiswal, the then Regional Manager, Uttar Pradesh Upbhokta Sahkari Sangh Limited (hereinafter referred to as the "UPUSSL"), Lucknow Regional Office, Lucknow with an object to cheat the government of the funds allocated under the MNREGS and in furtherance of the said conspiracy, they caused loss to the government exchequer to the tune of Rs. 11,15,340/-
6. The CBI, in its investigation, further found that canvas movable worksheds form part of work-site facilities which were to be provided by various executive agencies at the place of execution of works to give shade to the labourers as per para 3.4.1 of Notification No.107/38-7/2006-8 NREGA dated 08.02.2007 issued by Rural Development Section-7 of Government of Uttar Pradesh. These canvas movable worksheds should have been purchased by respective end user agencies i.e. gram panchayats. The order dated 01.08.2008 issued by the Government of Uttar Pradesh specifically prohibited district authorities from making centralized purchase of such items.
7. Investigation, by the CBI, further revealed that the UPUSSL is a co-operative firm established under the Uttar Pradesh Co-operative Societies Act, 1965, now registered under Multi State Cooperative Societies Act, 2002 had issued circular from time to time to lay down general guidelines and circulars. Directions were issued by UPUSSL, Head Office, Lucknow vide Circular dated 21.12.2006 regarding supply of different materials from branches/depot of UPUSSL of entire Uttar Pradesh.
8. It is important to note that District Mahoba does not fall under the Lucknow Regional Office of UPUSSL. The CBI, in its investigation, found that the Regional Branch of UPUSSL, situated at Lucknow, in contravention to above noted Circular dated 21.12.2006, suo moto offered to supply canvas movable worksheds and other work-site facilities under MNREGS in District Mahoba vide their letter dated 15.03.2008, which was addressed to Chief Development Officer, Mahoba. The rates quoted were Rs. 16,900/- per piece of canvas movable workshed of the dimension 10x12x7 feet (exclusive of taxes). It was found that the aforementioned letter dated 15.03.2008 was handed over to the present accused-applicant by co-accused, Raj Kamal Goyal on 28.03.2008. The present accused-applicant in furtherance to criminal conspiracy with Raj Kamal Goyal on the same day instructed PD, DRDA, Mahoba for placing supply orders dated 28.03.2008 in favour of UPUSSL, Lucknow for centralized purchase of canvas movable worksheds at district level in utter violation of extant financial rules & regulations of Government of Uttar Pradesh. For such purchase, tender procedure ought to have been followed, but the accused-applicant neither proceeded for tender proceedings nor he got conducted any market survey to ascertain the actual price of canvas movable worksheds which ultimately caused a wrongful loss to the government exchequer to the tune of Rs. 11,15,340/-.
9. The CBI, after investigating the offence, filed charge-sheet bearing no.2167 of 2015 on 31.08.2015 under Sections 120-B IPC read with Sections 409, 420, 468 and 471 IPC read with Sections 13(2) and 13(1)(d) of the PC Act.
10. The learned trial Court took cognizance and issued summons vide order dated 05.10.2015 to the accused-applicant to appear and face rhe trial. The accused-applicant did not appear in pursuance of the summons issued and, therefore, non-bailable warrants of arrest dated 02.11.2015 were issued against the accused-applicant.
11. The accused-applicant filed 482 Application No.5606 of 2015 to quash the charge-sheet as well as summoning order dated 05.10.2015 and order dated 02.11.2015 by means of which non-bailable warrants of arrest were issued. This Court vide order dated 23.11.2015 disposed of the said application with the direction to Magistrate/Trial Court concerned to make expeditious disposal of bail application moved by the accused-applicant in the light of principle laid down by the seven Judges Bench of this Court in the case of Amrawati & Anr Vs. State of U.P. reported in [2004 (57) ALR 290] and affirmed by the Supreme Court in the case of Lal Kamlendra Pratap Singh Vs. State of U.P. reported in [2009 (3) ADJ 322 (SC)] subject to condition that the accused-applicant shall appear before Magistrate/Trial Court concerned within one month from today and shall move bail application in accordance with law.
12. The applicant was enlarged on bail by this Court vide order dated 11.03.2016 passed in Bail No.377 of 2016
13. The discharge application moved by the applicant under Section 227 of the Code of Criminal Procedure, 1973 (hereinafter referred to as the "CrPC") in the Court of Special Judge, CBI, Lucknow was rejected vide order dated 10.11.2016. The said order, rejecting the discharge application, was challenged before this Court by way of filing Criminal Revision No.11 of 2017, however, the same was dismissed vide order dated 05.01.2017.
14. The learned trial Court has framed charges vide order dated 20.02.2018 under Sections 120-B IPC read with Sections 409, 420, 468 and 471 IPC and Sections 13(2) read with Sections 13(1)(d) of the PC Act against the present accused-applicant and co-accused, Anil Kumar Jaiswal.
15. Now, the present application has been filed for quashing of the criminal proceedings on the ground that in the departmental proceedings the accused-applicant has been exonerated. The departmental proceedings were initiated against the accused-applicant and charge-sheet dated 16.04.2010 was issued by the government. The inquiry officer submitted the inquiry report dated 04.08.2010, exonerating the accused-applicant of all charges. The accused-applicant was reinstated in service by Office Memorandum issued by the Secretary, Gramya Vikas dated 13.10.2010 and thereafter he was transferred/posted as Chief Development Officer, Santkabir Nagar vide order dated 27.11.2010. The accused-applicant had retired from the post of Chief Development Officer, Santkabir Nagar on 31.12.2011.
16. The learned counsel for the accused-applicant has submitted that since the accused-applicant was exonerated on merit in the departmental proceedings, initiated against him, the continuation of the trial in pursuance to the charge-sheet filed by the CBI would be an abuse of process of the Court. To buttress his submission, the learned counsel for the accused-applicant has placed reliance on the following judgments:-
i. (2011) 3 SCC 581 (Radheshyam Kejriwal Vs. State of West Bengal and another); and ii. (2020) 9 SCC 636 (Ashoo Surendranath Tewari Vs. Deputy Superintendent of Police, EOW,CBI and another.
17. Mr. Anurag Kumar Singh, learned counsel for the respondent - CBI has submitted that the departmental proceedings and the impugned criminal proceedings are entirely different in nature. The departmental inquiry did not include the offence under the IPC and PC Act. In the present case, on allegation of commission of offence, charge-sheet has been filed and the charges have been framed against the accused-applicant that he, in criminal conspiracy with co-accused, Raj Kamal Goyal, a private person, and Anil Kumar Jaiswal with an object to cheat the government under MNREGS's funds and in furtherance of the said criminal conspiracy, he caused a wrongful loss to the government exchequer to the tune of Rs.11,15,340/-. It is further submitted that there is enough evidence available against the accused-applicant for commission of the offence and the trial Court, after considering the evidence on record, has framed the charges.
18. The learned counsel for the respondent - CBI has, therefore, submitted that if the accused-applicant has been exonerated in the departmental proceedings it would itself not render the criminal proceedings against the accused-applicant invalid or abuse of process of the Court. It is further submitted that the investigation had revealed that on receipt of complaint of irregularities in centralized purchase from several districts, Mr. Anurag Yadav, Additional Commissioner, Rural Development Department, Government of U.P., Lucknow vide DO Letter No.790/NREGS-90/08 dated 28.05.2008 issued to all District Magistrates of Uttar Pradesh highlighted about its seriousness. By this letter, all the District Magistrates were directed to furnish details of such purchases made in their districts, if any, by 30.05.2008. The District Magistrates were also directed to furnish information by 30.05.2008 in case no such purchases had been made in the past.
19. The learned counsel for the respondent - CBI has further submitted that from the investigation it could be revealed that decision to rescind the supply order placed with UPUSSL was prompted by such tough stand of State Administration with regard to centralized purchases. The accused, including the present accused-applicant, got alarmed of the events and promptly acted to rescind the order issued for centralized purchases by DRDA, Mahoba. It is also submitted that no gram panchayats had issued proposals for procurement of canvas movable worksheds which was required as per MNREGA Act, Scheme and Guidelines and no purchase orders were issued by any gram panchayats at any point of time and supplies were imposed upon them. The learned counsel for the respondents - CBI has, therefore, submitted that it is trite law that the standard of proof in a departmental proceeding, being based on preponderance of probability, is somewhat lower than the standard of proof in a criminal proceeding where the case has to be proved beyond reasonable doubt.
20. The only question, which is involved in the present case, is that whether on the basis of exoneration in the departmental proceedings, the criminal proceedings ought to be quashed. The Supreme Court in (2009) 10 SCC 674 (Central Bureau of Investigation Vs. V. K. Bhutiani) has dealt with the issue and held that the exoneration in the departmental proceedings ipso facto would not result into quashing of the criminal prosecution. However, if the prosecution against an accused is solely based on findings in the departmental proceedings and those findings are set-aside by the superior authority in hierarchy, the same very foundation goes and prosecution may be quashed. However, the same principle would not apply in case the departmental proceedings and the criminal proceedings are held at two different entities and they are not in the same hierarchy. In Central Bureau of Investigation Vs. V. K. Bhutiani's case (supra), the Central Vigilance Commission had almost exonerated the delinquent employee and the High Court, placing reliance on report of the Vigilance Commission, had quashed the criminal proceedings against V. K. Bhutiani, the Supreme Court has held that the report of Central Vigilance Commission may be a relevant factor, but it cannot be held to be "be all or end all" in the matter for prosecuting accused persons of such serious offence.
21. In the case reported in (2012) 9 SCC 685 (State (NCT of Delhi) Vs. Ajay Kumar Tyagi), the Supreme Court has set-aside the order of the High Court whereby the criminal proceedings against an accused were quashed on premise of accused-delinquent had been exonerated in the departmental proceedings. In paragraph-25 of the said judgment, it has been held as under:-
"25. We are, therefore, of the opinion that the exoneration in the departmental proceeding ipso facto would not result in the quashing of the criminal prosecution. We hasten to add, however, that if the prosecution against an accused is solely based on a finding in a proceeding and that finding is set aside by the superior authority in the hierarchy, the very foundation goes and the prosecution may be quashed. But that principle will not apply in the case of the departmental proceeding as the criminal trial and the departmental proceeding are held by two different entities. Further, they are not in the same hierarchy."
22. This Court in the case reported in AIR OnLine 2020 All 2702 (Om Narayan Tiwari Vs. State of Uttar Pradesh) has held that the two proceedings, criminal and departmental, are entirely different. They operate in different fields and they have different objectives. In service jurisprudence, the purpose of enquiry proceeding is to deal with the delinquent employee departmentally and impose penalty in accordance with the service rules. The rule, relating to appreciation of evidence and proof in the two proceedings, is also not similar. In criminal law, burden of proof is on the prosecution to prove the guilt without reasonable doubt, on the other hand, penalty can be imposed on the delinquent employee on a finding recorded on the basis of preponderance of probability. Paragraphs 23 to 29 of the said judgment, which are relevant, are extracted hereunder.
"23. On having considered the law, reverting to Ashoo Tiwari case relied by the learned counsel for the applicant. The Supreme Court relying on Radheyshyam Kejriwal Vs. State of West Bengal and another6 (for short ''Radheyshyam Kejriwal case), set aside the judgment of the High Court and Special Judge and discharged the appellant from the offence under the Penal Code. The facts, therein, was that the employer SIDBI did not consider it a fit case, consequently, declined permission to prosecute the appellant. The Chief Vigilance Commission (CVC) after having gone through the arguments put forth by the CBI and SIDBI during the course of joint meeting was of the opinion that the appellant may have been negligent without any criminal culpability.
24. In Radhey Shyam Kejriwal, the adjudicating authority under the provisions of the Foreign Exchange Regulation Act, 1973 was not convinced with the Enforcement Directorate to impose penalty upon the appellant. In other words, if the departmental authorities themselves, in statutory adjudication proceedings recorded a categorical and an unambiguous finding that there is no such contravention of the provisions of the Act, it would be unjust for such departmental authorities to continue with the criminal prosecution and say that there is sufficient material. It would be unjust and an abuse of the process of the court to permit Enforcement Directorate & Foreign Exchange Regulatory Authority to continue with criminal proceedings on the very same material.
25. After referring to various decisions the Supreme Court culled out the ratio of the decisions as follows:-
"38. The ratio which can be culled out from these decisions can broadly be stated as follows:
(i) Adjudication proceedings and criminal prosecution can be launched simultaneously;
(ii) Decision in adjudication proceedings is not necessary before initiating criminal prosecution;
(iii) Adjudication proceedings and criminal proceedings are independent in nature to each other;
(iv) The finding against the person facing prosecution in the adjudication proceedings is not binding on the proceeding for criminal prosecution;
(v) Adjudication proceedings by the Enforcement Directorate is not prosecution by a competent court of law to attract the provisions of Article 20(2) of the Constitution or Section 300 of the Code of Criminal Procedure;
(vi) The finding in the adjudication proceedings in favour of 8 the person facing trial for identical violation will depend upon the nature of finding. If the exoneration in adjudication proceedings is on technical ground and not on merit, prosecution may continue; and
(vii) In case of exoneration, however, on merits where the allegation is found to be not sustainable at all and the person held innocent, criminal prosecution on the same set of facts and circumstances cannot be allowed to continue, the underlying principle being the higher standard of proof in criminal cases."
26. The Court finally concluded:
"39. In our opinion, therefore, the yardstick would be to judge as to whether the allegation in the adjudication proceedings as well as the proceeding for prosecution is identical and the exoneration of the person concerned in the adjudication proceedings is on merits. In case it is found on merit that there is no contravention of the provisions of the Act in the adjudication proceedings, the trial of the person concerned shall be an abuse of the process of the court."
27. In nutshell, to recapitulate, in Radhey Shaym Kejriwal, the statutory adjudicating authority did not find prima facie case to impose penalty for violation of the Act. The prosecution based on the same material was held unjustified and abuse of the process of the Court. In Ashoo Tiwari, CVC agreed with the competent authority of SIDBI, after hearing the CBI, that complicity and culpability of the appellant was not found. The Court relying on para 38(vii) of Radhey Shaym Kejriwal and having regard to the detail CVC order was of the considered opinion that the "chances of conviction in a criminal trial involving the same facts appear to be bleak".
28. Both the decisions were decided on the peculiar facts arising therein, the decisions do not lay down any proposition that exoneration of an employee in departmental disciplinary proceedings, the criminal prosecution on the identical charge or evidence has to be quashed automatically.
29. Even otherwise in a case were acquittal of the employee by the criminal court is concerned it does not preclude the employer from taking disciplinary action if it is otherwise permissible. The two proceedings, criminal and departmental, are entirely different. They operate in different fields and have different objectives. In service jurisprudence, the purpose of enquiry proceeding is to deal with the delinquent employee departmentally and impose penalty in accordance with the service rules. The rule relating to appreciation of evidence and proof in the two proceedings is also not similar. In criminal law burden of proof is on the prosecution to prove the guilt. "without reasonable doubt", on the other hand, penalty can be imposed on the delinquent employee on a finding recorded on the basis of "preponderance of probability" (Refer-Avinash Sadashiv Bhosale (D) through legal heirs Vs. Union of India7, G.M. Tank Versus State of Gujarat and others8; Depot Manager, A.P. State Road Transport Gorakhpur Vs. Mohd. Yusuf Miya)."
23. In Radheshyam Kejriwal Vs. State of West Bengal and another case (supra), it has been held that the standard of proof in a criminal case is much higher than that of the adjudication proceedings under the PMLA and if the Enforcement Directorate had not been able to prove its case in the adjudication proceedings and the appellant has been exonerated on the same allegation, the determination of the facts in adjudication proceedings could not be said to be irrelevant in the criminal case. Paragraphs 26, 29 and 31 of the said judgment, which have been relied on in the judgment in the case of Ashoo Surendranath Tewari Vs. Deputy Superintendent of Police, EOW,CBI and another (supra), are extracted hereunder:-
"26. We may observe that the standard of proof in a criminal case is much higher than that of the adjudication proceedings. The Enforcement Directorate has not been able to prove its case in the adjudication proceedings and the appellant has been exonerated on the same allegation. The appellant is facing trial in the criminal case. Therefore, in our opinion, the determination of facts in the adjudication proceedings cannot be said to be irrelevant in the criminal case. In B.N. Kashyap the Full Bench had not considered the effect of a finding of fact in a civil case over the criminal cases and that will be evident from the following passage of the said judgment :(AIR p.27) ".....I must, however, say that in answering the question, I have only referred to civil cases where the actions are in personam and not those where the proceedings or actions are in rem. Whether a finding of fact arrived at in such proceedings or actions would be relevant in criminal cases, it is unnecessary for me to decide in this case. When that question arises for determination, the provisions of Section 41 of the Evidence Act, will have to be carefully examined."
29. We do not have the slightest hesitation in accepting the broad submission of Mr. Malhotra that the finding in an adjudication proceeding is not binding in the proceeding for criminal prosecution. A person held liable to pay penalty in adjudication proceedings cannot necessarily be held guilty in a criminal trial. Adjudication proceedings are decided on the basis of preponderance of evidence of a little higher degree whereas in a criminal case the entire burden to prove beyond all reasonable doubt lies on the prosecution.
31. It is trite that the standard of proof required in criminal proceedings is higher than that required before adjudicating authority and in case the accused is exonerated before the adjudicating authority whether his prosecution on same set of facts can be allowed or not is the precise question which falls for determination in this case."
24. In paragraph-38 of the judgment in Radheshyam Kejriwal Vs. State of West Bengal and another case (supra), the ratio has been culled out from various decisions in respect of adjudication proceedings under the PMLA and criminal prosecution, which reads as under:-
"38. The ratio which can be culled out from these decisions can broadly be stated as follows :-
(i) Adjudication proceedings and criminal prosecution can be launched simultaneously;
(ii)Decision in adjudication proceedings is not necessary before initiating criminal prosecution;
(iii) Adjudication proceedings and criminal proceedings are independent in nature to each other;
(iv)The finding against the person facing prosecution in the adjudication proceedings is not binding on the proceeding for criminal prosecution;
(v) Adjudication proceedings by the Enforcement Directorate is not prosecution by a competent court of law to attract the provisions of Article 20(2) of the Constitution or Section 300 of the Code of Criminal Procedure;
(vi)The finding in the adjudication proceedings in favour of the person facing trial for identical violation will depend upon the nature of finding. If the exoneration in adjudication proceedings is on technical ground and not on merit, prosecution may continue; and
(vii) In case of exoneration, however, on merits where allegation is found to be not sustainable at all and the person held innocent, criminal prosecution on the same set of facts and circumstances can not be allowed to continue, the underlying principle being the higher standard of proof in criminal cases.
25. Thus, it is important to mention here that Radheshyam Kejriwal was not a case of departmental proceedings and criminal proceedings, but it was the case of adjudication proceedings under the PMLA and criminal proceedings against the person. In adjudication proceedings under the PMLA, it is the specialized Court of competent jurisdiction which evaluates the evidence in respect of adjudication and then records its findings. However, in the departmental proceedings, it is a trained judicial mind which records the finding of guilt or exoneration. The findings of disciplinary authority or inquiry officer are based on preponderance of probability. I am of the view that the judgment in Radheshyam Kejriwal Vs. State of West Bengal and another's case (supra) cannot be of any application wherein the delinquent employee gets exonerated in departmental proceedings and he is facing departmental proceedings and criminal proceedings.
26. In view thereof, I am of the view that the whole premise of the learned counsel for the accused-applicant that since the accused-applicant has been acquitted in the departmental proceedings, the criminal proceedings are to be quashed, has no merit and substance and, thus, this application is hereby dismissed.
[D.K. SINGH, J.] Order Date :- 5.12.2022 MVS/-