Delhi District Court
Cbi vs . M/S Jld Yavatmal Energy Ltd. & Ors. on 13 July, 2023
IN THE COURT OF SH. SANJAY BANSAL:
SPECIAL JUDGE (PC ACT) (CBI) (COAL BLOCK CASES)-02:
ROUSE AVENUE DISTRICT COURTS: NEW DELHI.
CNR No. DLCT110004422019
CC No. 105/2019
RC No. 219 2012 E 0010,
Branch: CBI/EOU-IV/New Delhi
CBI Vs. M/s JLD Yavatmal Energy Ltd. & Ors.
U/s. 120-B, 120-B/ 409/420 IPC and
Sec 13(1) (c)/13 (1) (d) P.C. Act 1988
Date of order on cognizance : 31.07.2015
Date of framing of charge : 10.11.2016
Date on which judgment
was reserved : 13.07.2023
Date of judgment : 13.07.2023
Central Bureau of Investigation (CBI)
Vs.
(1) M/s JLD Yavatmal Energy Ltd.
Flat No. 4, 191/192 Ring Road, Trimurty Nagar,
Nagpur, Maharashtra - 440022 (Convicted)
(2) Manoj Kumar Jayaswal
S/o Sh. Basant Lal Shaw
8th Floor, JP Heights,
Byramji Town, Nagpur,
Maharashtra - 440013 (Convicted)
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 1 of 405
(3) Vijay Darda
S/o Sh. Jawaharlal Darda
(i) Yavatmal House, Swatantra Senani
Jawaharlal Darda Marg, Rahate Colony,
Nagpur, Maharashtra.
(ii) Yavatmal House, 9 Lodhi Estate,
New Delhi. (Convicted)
(4) Devendra Darda
S/o Vijay Darda
Shubdha, B Wing, 5th Floor,
Opposite Traffic Police HQ
Sir Pochkhanwala Road,
Worli, Mumbai,
Maharashtra (Convicted)
(5) Harish Chandra Gupta
S/o Late Shri Kishan Lal Gupta,
R/o 377, Sector 15-A, NOIDA-201301,
Uttar Pradesh (Convicted)
(6) K.S. Kropha
S/o Late Sh. Sukh Das Kropha
R/o D-I/39, Bharti Nagar,
New Delhi - 110003.
Also at: Circuit House Complex,
Kenche's Trace, Laban,
Shillong-793004, Meghalaya
Permanent Address: Village Krozing,
PO Malang, District Lahoul Spiti,
Himachal Pradesh (Convicted)
(7) K.C. Samria
S/o Sh. G.L. Samria,
R/o D-I/81, Rabindra Nagar,
Amrita Shergill Marg,
New Delhi - 110003. (Convicted)
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 2 of 405
APPEARANCES
Present : Ld. Senior Advocate, Sh. R.S. Cheema, Special PP (through
VC), alongwith Ld. DLA Sh. A.P. Singh, Ld. DLA Sh. Sanjay
Kumar, Ld. Sr. P.P. Sh. N.P. Srivastava and Ld. Advocate Ms.
Tarannum Cheema for CBI.
Ld. Counsels Sh. Vijay Aggarwal, Sh. Nagesh Behl, Sh. Vishal
Gaurav, Sh. Chetan Manchanda and Sh. Rajat Tayal for A-1 to
A-4 and Ld. Counsel Sh. Aashish Chojar for A-5 to A-7.
J U D G M E N T:
T AB L E O F C O N T E N T S PAR T I C U L A R S PAR A G R A P H PAG E S NUMBERS P AR T- A 1 to 22 4 - 14 THE A L L E G ATI O N S P AR T- B 23 to 25 14 - 20 THE CHARGE P AR T- C 26 to 579 21 - 203 THE PROSECUTION EVIDENCE P AR T- D 580 203 - 204 CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 3 of 405 S T ATE M E N T S O F ACCUSED PERSONS U/S 313 CRPC P AR T- E 581 to 626 204 - 221 THE DEFENCE EVIDENCE P AR T- F 627 to 639 221 - 225 THE ARGUMENTS P AR T- G 640 to 1016 225 - 405 T H E A N A LYS I S AND DECISION OF THE COURT PART - A THE ALLEGATIONS
1. The present case pertains to allocation of 'Fatehpur East' coal block situated in the State of Chhattisgarh in favour of M/s JLD Yavatmal Energy Private Limited (for short "M/s JLD" or "JLD").
2. The FIR No. RC 219 2012 E 0010 in the present case was CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 4 of 405 registered pursuant to the findings of Preliminary Enquiry No. 219 2012 E 0002 which was initiated by the CBI on the reference of Central Vigilance Commission.
3. The allegations, in brief and as per the Final Report, were that Ministry of Coal ("MoC"), Govt .of India, used to allocate captive coal blocks to companies for their end use plants in steel, cement and power sectors based on the recommendations of the Screening Committee which was headed by the Secy. (Coal). Enquiry revealed that MoC issued an advertisement dated 13.11.2006 and invited applications for allocation of coal blocks including Fatehpur East coal block situated in the state of Chhattisgarh. In response to the advertisement, applications from various companies were received. The 35 th Screening Committee concluded its deliberation on 13.09.2007 and recommended allocation of Fatehpur East coal block jointly to M/s JLD Yavatmal Energy Private Ltd. and four other companies for their proposed power plants situated in the state of Maharashtra and Chhattisgarh. It was also found in the enquiry that Ministry of Power ("MoP"), Govt. of India, had recommended allocation of the above said coal block to four companies including M/s JLD. It was also found that Govt. of Chhattisgarh had not recommended the name of M/s JLD. The enquiry also revealed that M/s JLD CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 5 of 405 had misrepresented/concealed various facts in the application form in order to qualify and obtain wrongful gain in allocation of coal block. It was discovered that M/s JLD had fraudulently claimed in its application that it was jointly promoted, controlled and managed by Lokmat Group and M/s Infrastructure Development Finance Company Ltd. ("IDFC") and also claimed networth of IDFC to the tune of Rs. 2544.19 crores and that of M/s Lokmat Group to the tune of Rs. 73.38 crores as networth of JLD. It was found that if networth of IDFC and M/s Lokmat Group had not been included, M/s JLD could not have qualified for allocation as it did not meet criteria of 0.50 crores per Mega Watt adopted by Central Electricity Authority ("CEA"). It was also found that the company had not disclosed allocation of four coal blocks to its group companies between the year 1999-2005. It was also suspected that officials of the MoC in pursuance of a criminal conspiracy failed to carry out the scrutiny of the documents regarding false claims/concealment of facts by M/s JLD. As such FIR was registered for the offences u/s 120-B r/w 420 of Indian Penal Code, 1860 ("IPC") against M/s JLD Yavatmal Energy Limited, its directors namely Manoj Kumar Jayaswal, Vijay Darda, Devendra Darda and other directors and also other unknown persons. Investigation was initiated.
4. During investigation, it was confirmed that MoC had issued an CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 6 of 405 advertisement for allocation of 38 coal blocks in November 2006. These coal blocks were for captive coal mining to companies engaged in generation of power, production of iron and steel and cement.
5. For ascertaining inter se priority of various applicants for allocation of Coal Blocks for captive use, the following guidelines were uploaded on the website:
Status (stage) level of progress and state of preparedness of the projects;
networth of the applicant company (or in the case of a new SP/JV, the networth of their principals);
Production capacity as proposed in the application; Maximum recoverable reserve as proposed in the application; Date of commissioning of captive mine as proposed in the application;
Date of completion of detailed exploration (in respect of unexplored blocks only) as proposed in the application;
Technical experience (in terms of existing capacities in coal/lignite mining and specified end use);
Recommendation of the Administrative Ministry concerned; Recommendation of the State Govt. concerned (i.e. where the captive block is located);
Track record and financial strength of the company.
6. It was found during investigation that M/s JLD had submitted its application to MoC for allocation of Fatehpur East coal block through its authorised signatory on 12.01.2007. In the application, the company had shown CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 7 of 405 combined networth of M/s Lokmat Group alongwith that of IDFC (Rs. 73.38 crores + Rs. 2544.19 crores) as on 31.03.2006. It had also mentioned in the application that M/s JLD Yavatmal Energy Ltd. was promoted, controlled and managed by Lokmat Group and IDFC. Information in regard to previous allocation was mentioned as 'No'. The application was signed by Vinay Taneja, General Manager, as authorised signatory. It is stated that the application was prepared as per directions of Manoj Kumar Jayaswal, Director, M/s JLD.
7. It was also found during the investigation that a joint Memorandum of Understanding ("MOU") dated 27.12.2006 was signed between IDFC and Abhijeet Group represented by M/s Abhijeet Infrastructure Ltd. and also Lokmat Group represented by M/s Lokmat Newspapers Pvt. Ltd. It was found that as per the MOU, Abhijeet Group and Lokmat Group were desirous of forming a consortium to bid for coal block allocation and had incorporated a Special Purpose Vehicle ("SPV") under the name and style of M/s JLD Yavatmal Energy Ltd. It was for development/undertaking coal mining activities and set up coal based power plant with capacity of 1215 MW in Yavatmal District in the State of Maharashtra. Further as per clause 1.6 of the MOU, IDFC on request of Abhijeet Group and Lokmat Group had agreed to join the consortium and take part in management and business of the SPV. Further as CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 8 of 405 per clause 1.9 of the MOU, Abhijeet Group and Lokmat Group were the lead managers whereas IDFC was to participate as financial investor. It was, however, mentioned in Clause 2 (a) that IDFC shall not be or treated as Promoter or sponsors of the SPV for any purpose and reasons whatsoever. As per MOU, IDFC had agreed to subscribe upto 20% of the equity of the SPV and nominate its director on the board.
8. During investigation, it was also found that in case of SPV/JV, the networth of its principals was to be mentioned. However there were no guidelines for submission of audited balance sheets of the SPV/JV and no minimum threshold in respect of networth was specified. Further it was also not specified as to what weightage would be accorded to the parameters for allocation of coal block i.e. recommendations of State Govts., recommendations of the Administrative Ministries and Status of Preparedness.
9. Investigation revealed that a presentation was made by representative of M/s JLD before 35 th Screening Committee on 21.06.2007. The presentation was made by Devendra Darda (Director) on behalf of the company. He also submitted a feedback form. He was accompanied by Sanjay Dey, Vice President.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 9 of 405
10. It was stated that during investigation, it could not be substantiated that M/s JLD had embellished its claim qua networth because no evidence was found to show that the company was given any undue benefit by MoC.
11. In Column No. 29 and 30, information about earlier allocation of coal block to the company or to the group or associated company was NIL.
12. During investigation one MOU dated 31.03.2006 was also collected and it was found that the same was signed by Basant Lal Shaw and his family members including Manoj Kumar Jayaswal and it was a declaration about oral understanding reached by and between them regarding division of principal operating companies of NECO Group and Abhijeet Group. It was also found that companies forming part of Abhijeet Group were having coal blocks allocated to them earlier.
13. Enquiries were made from MoC to provide relevant information/documents regarding purpose/rationale for which the information relating to the previous allocation was sought from the applicant companies. One S.K. Shahi, Director, MoC vide his letter dated 03.05.2013 informed that rationale/logic for seeking such information could not be ascertained but also mentioned that the possible link could be evaluation of technical experience CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 10 of 405 mentioned in the guidelines.
14. It was also found during investigation that previous allocation to an applicant company or its group or associate company was not a disqualification either in the guidelines or in the minutes of the 35 th Screening Committee. Thus even if information qua previous allocation had been mentioned, the same would not have made any difference.
15. The conclusion of the investigation was thus that M/s JLD Yavatmal Energy Ltd. had not obtained any undue benefit from MoC by not declaring previous allocation. Further no material was found to show commission of any offence of criminal conspiracy or cheating.
16. As such a closure report was filed by the CBI on 15.04.2014.
17. My Ld. Predecessor considered the closure report. On 09.10.2014, it was stated on behalf of CBI that they would be filing a revised closure report which shall be detailed in all respect. As such revised closure report was filed on 16.10.2014.
18. Vide detailed order dated 20.11.2014, my Ld. Predecessor disagreed with the closure report and observed that the private parties i.e. the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 11 of 405 company and its directors appeared to have committed offence of cheating by obtaining allocation of coal block on the basis of false representations and that there was active connivance between them and public servants i.e. officials of MoC. He also observed that offences under Prevention of Corruption Act, 1988 ("PC Act") were also revealed. In para No. 43 and 44 of the order dated 20.11.2014 it was observed as under:
"43. Accordingly in view of my aforesaid discussion the conclusion drawn by the investigating agency to close the case cannot be accepted. Prima facie offence of cheating i.e. u/s 420 IPC has been committed by the private parties involved in furtherance of a criminal conspiracy i.e. u/s 120-B IPC hatched between them and the officers of MoC and Screening Committee. At the same time the MoC Officers and the Screening Committee have prima facie committed offences of criminal breach of trust and of criminal mis- conduct i.e. u/s 409 IPC and Section 13 (1) (c) and 13 (1) (d) (iii) PC Act in furtherance of the criminal conspiracy i.e. u/s 120-B IPC entered into by them with the private parties involved. The crucial question which now arises is as to against which of the persons, be the private parties or the public servants the cognizance of various offences needs to be taken.
44. Besides M/s JLD, the company which applied for allocation of Coal Block, its director M.K. Jayaswal at whose instance the false information was submitted or the misrepresentation was made are prima facie liable to be proceeded against. Devender Darda who was the Director of M/s JLD had appeared before the Screening Committee and the feed back form was filled and signed by him. In the said feed back form also misrepresentation was made with regard to mentioning about allocation of previous Coal Blocks. Misrepresentation was also made as regard the networth of the company (The issue has already been discussed earlier whereby M/s JLD was not authorized to claim the networth of IDFC). Thus Devender Darda played an active role in the entire conspiracy by making specific misrepresentation about the claim of M/s JLD with regard to its networth and earlier allocation of Coal Block. As regard Vijay Darda who was the Chairman of Lokmat Group, it has come on record that he wrote a number of letters to the Prime Minister seeking allotment of Fatehpur (East) Coal Block in favour of M/s JLD. Vijay Darda at that time was a sitting Member of Parliament (Rajya Sabha) and he too had specifically claimed in his letter dated 18.06.07 and 06.08.07 addressed to the then Prime Minister that M/s CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 12 of 405 JLD was promoted, managed and controlled by Lokmat Group and IDFC. Thus once again there was a clear misrepresentation at different forums by Sh. Vijay Darda on behalf of M/s JLD to claim allotment of yet another Coal Block. It is also prima facie clear that Sh. H.C. Gupta, who was Secretary, MoC and was also the Chairman of Screening Committee, Sh. K.S. Kropha, the then Joint Secretary, MoC and who was also the Member Convener Screening Committee beside Sh. K.C. Samaria, the then Director, CA-I, MoC (all the applications were received in the office of Director CA-I, and his office supervised the entire process of processing the applications right through the entire process of allocation of Coal Blocks) were the persons responsible to take all those necessary safeguards which were necessary to protect the public interest and thus they ought to be proceeded against. Their conduct clearly falls within the four corners of the offence of criminal misconduct as defined in Section 13 (1) (c) and 13 (1) (d) (iii) PC Act besides offence u/s 409 IPC r/w Section 120-B IPC."
19. Thereafter my Ld. Predecessor observed that sanction was required for prosecution of K.S. Kropha and K.C. Samria as they were in service whereas no sanction was required against accused H.C. Gupta as he had retired. As such he sent the matter for further investigation for obtaining sanction.
20. Thereafter the matter was going on awaiting sanction. However, the sanction did not come. As such on 22.07.2015, vide a detailed order, my Ld. Predecessor held that in the given facts and circumstances, and as the competent sanctioning authority had failed to take any decision on the request of CBI for according sanction to prosecute public servants u/s 19 PC Act, the sanction should be deemed to have been granted. Thus, sanction against K.S. Kropha and K.C. Samria u/s 19 PC Act was deemed to have been granted. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 13 of 405
21. Thereafter vide another detailed order dated 31.07.2015, my Ld. Predecessor took cognizance of the offences u/s 120-B IPC; 120-B IPC r/w section 409/420 IPC and Section 13(1)(c)/13(1)(d) P.C. Act, 1988 against all the accused persons i.e. M/s JLD Yavatmal Energy Ltd., its Directors Manoj Kumar Jayaswal, Vijay Darda, Devendra Darda and officials of MoC namely H.C. Gupta, K.S. Kropha and K.C. Samria. He also took cognizance of the offences u/s 13(1)(c)/13(1)(d) P.C. Act, 1988 and section 409 IPC against accused H.C. Gupta, K.S. Kropha and K.C. Samria. He further took cognizance of the offence u/s 420 IPC against M/s JLD Yavatmal Energy Ltd. and its Directors Manoj Kumar Jayaswal, Vijay Darda and Devendra Darda. Summons were issued accordingly.
22. All the accused persons appeared and were admitted to bail. Company M/s JLD appointed Sh. Suresh Dakhane as its AR u/s 305 CrPC. Copies of the chargesheet were supplied to the accused persons as per Section 207 CrPC.
PART - B THE CHARGE
23. Thereafter my Ld. Predecessor heard parties on the point of charge CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 14 of 405 and vide detailed order dated 10.11.2016, charge for the offences u/s 120-B IPC; 120-B/409/420 IPC and Section 13(1)(c) and 13(1)(d) P.C. Act 1988 was ordered to be framed against all the accused persons i.e. company M/s JLD Yavatmal Energy Private Limited, its directors Manoj Kumar Jayaswal, Vijay Darda, Devendra Darda and public servants i.e. accused H.C. Gupta, K.S. Kropha and K.C. Samria. Charge for the substantive offence i.e. u/s 409 IPC and Section 13(1)(c) and 13(1)(d) P.C. Act, 1988 was also ordered to be framed against accused H.C. Gupta; and also charge for the substantive offence u/s 13(1)(d) P.C. Act, 1988 was ordered to be framed against other two public servants i.e. K.S. Kropha and K.C. Samria. Charge for the substantive offence of cheating i.e. u/s 420 IPC was ordered to be framed against company M/s JLD and its directors Manoj Kumar Jayaswal, Vijay Darda and Devendra Darda. All the accused persons, however, pleaded not guilty to all the charges so framed against them and claimed trial.
24. The charges so framed are being reproduced here for ready reference, as follows:
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 15 of 405 CHARGE A-1 to A-7 That during the year 2006-09 at Maharashtra, New Delhi and other places, you all i.e. Manoj Kumar Jayaswal, Vijay Darda, Devendra Darda, M/s. JLD Yavatmal Energy Ltd., H.C. Gupta, KS Kropha, and K C Samria entered into a criminal conspiracy to cheat Ministry of Coal, Govt. of India so as to procure allocation of a captive Coal Block, in favour of M/s JLD Yavatmal Energy Ltd. by adopting various illegal means viz by making false claims about the networth of M/s JLD Yavatmal Energy Ltd., appraisal and syndication of debt, promoters of M/s JLD Yavatmal Energy Ltd. and also concealed information about previous allocation of coal blocks to the group or associated complanies of M/s JLD Yavatmal Energy Ltd. in the application form and the feedback form and by way of various acts of omission and commission amounting to criminal misconduct/criminal breach of trust/criminal misappropriation by the public servants i.e. MoC officers, the details of which have been described in the detailed order on charge dated 10.11.2016 passed separately and you all thereby committed the offence of criminal conspiracy being punishable u/s 120-B IPC and within my cognizance.
Secondly, during the aforesaid period and in furtherance of the common object of the criminal conspiracy as described above you all did various acts of cheating, criminal breach of trust and criminal misconduct by public servants as described above and qua which substantive charges have been framed separately and you all thereby committed offences punishable u/s 120-B r/w 409, 420 IPC and 13(1)(c) & 13(1)(d) PC Act, 1988 and within my cognizance.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 16 of 405 CHARGE A-5 That you being the Secretary, Ministry of Coal, Govt. of India and Chairman, 35th Screening Committee, Ministry of Coal, in the year 2006-09 at New Delhi and while working as such public servant showed undue favour in furtherance of the common object of the criminal conspiracy (as described in the charge separately framed) as hatched with your co-accused persons i.e. Manoj Kumar Jayaswal, Vijay Darda, Devendra Darda and M/s. JLD Yavatmal Energy Ltd., KS Kropha and KC Samria in order to procure allocation of a captive coal block in favour of M/s JLD Yavatmal Energy Ltd., in as much as you being Secretary, Ministry of Coal, Govt. of India and Chairman 35 th Screening Committee, Ministry of Coal did not ensure the scrutiny of applications to see their completeness and eligibility and that the application of M/s JLD Yavatmal Energy Ltd. was liable to be rejected out rightly, as beside being incomplete the company M/s JLD Yavatmal Energy Ltd had also dishonestly used networth of Lokmat Group and IDFC in the application form and feedback form and in the presentation and you also did not ensure the scrutiny of applications either before the applications were considered by the Screening Committee or even after recommendations were made by the Screening Committee, when limited applications were only left to be scrutinised and that you also did not follow the guidelines laid down by the Ministry of Coal for making final recommendations for allotment of coal blocks and thereby committed various acts of omission and commission as also described in detail in the order on charge dated 10.11.2016 passed separately, and the said acts of omission and commission committed by you amounted to acts of criminal misconduct by a public servant with a view to secure allocation of "Fatehpur East"
situated in state of Chattisgarh in favour of M/s JLD Yavatmal Energy Ltd. from MoC and you thereby committed an offence punishable u/s 13(1)(d) PC Act, 1988 and within my cognizance.
Secondly you in your capacity as the Secretary Ministry of Coal, Govt. of India and Chairman, 35 th Screening Committee, Ministry of Coal, during the aforesaid period were having dominion over the nationalized natural resources of the country i.e. "coal" as available in various coal blocks including that of "Fatehpur East" situated in state of Chattisgarh and which coal blocks were to be allocated to the eligible companies on the recommendation of the Screening Committee (as constituted by MoC) to be made in accordance with the guidelines for allocation issued in this regard by Ministry of Coal and knowing fully well that the allocation of various coal blocks to different applicant companies shall be on the basis of recommendation of the Screening CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 17 of 405 Committee headed by you but you in furtherance of the common objective of the criminal conspiracy (as mentioned in the charge separately framed) as hatched with the other co-accused persons dishonestly and fraudulently recommended part allocation of "Fatehpur East" in violation of the guidelines issued in this regard governing such allocation of coal blocks and in violation of the trust so imposed in you by law and thereby facilitated M/s JLD Yavatmal Energy Ltd. and its directors to misappropriate and convert to their own use the impugned coal block i.e. "Fatehpur East" and you thereby committed an offence punishable u/s 13(1)(c) PC Act, 1988 and within my cognizance. Thirdly you in your capacity as Secretary Ministry of Coal, Govt. of India and Chairman, 35th Screening Committee, Ministry of Coal, during the aforesaid period were having dominion over the nationalized natural resources of the country i.e. "coal" as available in various coal blocks including that of "Fatehpur East", situated in the State of Chattisgarh and which coal blocks were to be allocated to the eligible companies on the recommendation of the Screening Committee (as constituted by MoC) to be made in accordance with the guidelines for allocation issued in this regard by Ministry of Coal and knowing fully well that the allocation of various coal blocks to different applicant companies shall be on the basis of recommendation of the Screening Committee headed by you but you dishonestly in furtherance of the common objective of the criminal conspiracy (as mentioned in the charge separately framed) hatched with your co-accused persons recommended part allocation of "Fatehpur East", in favour of M/s JLD Yavatmal Energy Ltd. in violation of the guidelines issued in this regard governing such allocation of coal blocks and the mode in which the trust so imposed in you by law was to be discharged and thereby facilitated allocation of impugned coal block i.e. "Fatehpur East" in favour of M/s JLD Yavatmal Energy Ltd. and thus disposed of the said property i.e. coal block as above and you thereby committed an offence punishable u/s 409 IPC and within my cognizance.
CHARGE A-1 to A-4 That you all i.e. Manoj Kumar Jayaswal, Vijay Darda, Devendra Darda and M/s. JLD Yavatmal Energy Pvt. Ltd. during the year 2006-09 at Maharashtra, New Delhi and other places in furtherance of the common object of the criminal conspiracy (as described in the charge separately framed) hatched by you all with your other co-accused CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 18 of 405 persons i.e. HC Gupta, KS Kropha and KC Samria, officers of MoC cheated Ministry of Coal, Govt. of India by dishonestly or fraudulently making false claims about the networth of M/s JLD Yavatmal Energy Ltd., appraisal and syndication of debt, promoters of M/s JLD Yavatmal Energy Ltd. and also concealed information about previous allocation of coal blocks to the group or associated complanies of M/s JLD Yavatmal Energy Ltd. in the application form and feedback form, and thereby induced Ministry of Coal, Govt. of India by allocate "Fatehpur East" coal block in favour of M/s. JLD Yavatmal Energy Pvt. Ltd., and you all thereby committed offence u/s 420 IPC and within my cognizance.
CHARGE A-6 That you being Jt. Secretary, Ministry of Coal, Govt. of India and Member Convener, 35th Screening Committee, Ministry of Coal, in the year 2006-09 at New Delhi and while working as such public servant showed undue favour in furtherance of the common object of the criminal conspiracy (as described in the charge separately framed) and as hatched with your co- accused persons i.e. Manoj Kumar Jayaswal, Vijay Darda, Devendra Darda, M/s. JLD Yavatmal Energy Pvt. Ltd., H.C. Gupta and K.C. Samria in order to procure allocation of a captive coal block in favour of M/s. JLD Yavatmal Energy Pvt. Ltd. in as much as you being Jt. Secretary, Ministry of Coal, Govt. of India and Member Convener, 35th Screening Committee, Ministry of Coal did not ensure the scrutiny of applications to see their completeness and eligibility and that the application of M/s. JLD Yavatmal Energy Pvt. Ltd. was liable to be rejected out rightly, as beside being incomplete the company M/s. JLD Yavatmal Energy Pvt. Ltd. had also dishonestly used networth of Lokmat Group and IDFC in the application and feedback form and you also did not ensure the scrutiny of applications either before the time when applications were considered by the Screening Committee or even after recommendations were made by the Screening Committee, when limited applications were only left to be scrutinised and that you also did not ensure that the guidelines laid down by Ministry of Coal for making final recommendations for allotment of coal blocks are followed and thereby committed various acts of omission and commission as described in detail in the order on charge dated 10.11.2016 passed separately, and the said acts of omission and commission committed by you amount to acts of criminal misconduct by a public servant with a view to secure allocation of "Fatehpur East" situated in state of Chattisgarh, in favour of M/s. JLD Yavatmal Energy Pvt. Ltd. from MoC and you thereby committed an offence punishable u/s 13(1)(d) PC Act, 1988 and within my cognizance.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 19 of 405 CHARGE A-7 That you being Director, CA-I, Ministry of Coal, Govt. of India in the year 2006-09 at New Delhi and while working as such public servant showed undue favour in furtherance of the common object of the criminal conspiracy (as described in the charge separately framed) as hatched with your co-accused persons i.e. Manoj Kumar Jayaswal, Vijay Darda, Devendra Darda, M/s. JLD Yavatmal Energy Pvt. Ltd. , H.C. Gupta and K.S. Kropha in order to procure allocation of a captive coal block in favour of M/s. JLD Yavatmal Energy Pvt. Ltd., in as much as you being Director, CA-I, Ministry of Coal, Govt. of India did not ensure the scrutiny of applications to check their completeness and eligibility and that the application of M/s. JLD Yavatmal Energy Ltd. was liable to be rejected out rightly, as beside being incomplete the company M/s. JLD Yavatmal Energy Pvt. Ltd. had also dishonestly used networth of Lokmat Group and IDFC in the application and feedback form and you also did not ensure the scrutiny of applications either before the time when applications were considered by the Screening Committee or even after recommendations were made by the Screening Committee, when limited applications were only left to be scrutinized and thereby committed various acts of omission and commission as described in detail in the order on charge dated 10.11.2016 passed separately and the said acts of omission and commission committed by you amount to acts of criminal misconduct by a public servant with a view to secure allocation of "Fatehpur East" situated in state of Chattisgarh, in favour of M/s. JLD Yavatmal Energy Pvt. Ltd., from MoC and you thereby committed an offence punishable u/s 13(1)(d) PC Act, 1988 and within my cognizance.
25. The accused persons did not admit or deny the documents u/s 294 CrPC. As such, prosecution examined its witnesses. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 20 of 405 PART - C THE PROSECUTION EVIDENCE
26. Prosecution, thereafter, in order to prove the charges, examined 24 witnesses. However, examination-in-chief of witnesses namely Sh. Ved Prakash Sharma, Dy. SP K. L. Moses, Sh. Piyush Goyal, Ct. Gordhan Singh and HC K.P. Singh was led by way of affidavits u/s 296 CrPC as their evidence was of formal character only. Out of these, Sh. Ved Prakash Sharma and Dy. SP K. L. Moses were also cross-examined.
27. For the purpose of clear understanding, the witnesses can be grouped as follows:
Witness(es) from: PW's Number & Name JLD Yavatmal Energy Pvt. Ltd. PW-1 Vinay Taneja and companies of Abhijeet Group PW-2 Harshad Pophali PW-3 Sanjay Dey PW-4 Murali Lahoti PW-8 Vivek Kumar CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 21 of 405 IDFC PW-6 Aditya S. Aggarwal PW-7 Vinayak Mavin Kurve Ministry of Coal PW-5 A. Sanjay Sahay PW-14 V.S. Rana PW-17 Ved Prakash Sharma PW-23 S.K. Shahi Ministry of Power or CEA PW-18 Manjit Puri (CEA) PW-19 Anil Kumar Kutty (MoP) Govt. of Maharashtra PW-13 Vinesh Kumar Jairath Govt. of WB PW-24 Bhaskar Khulbe Coal India Ltd. PW-12 Sushmita Sen Gupta Independent Witness/Search and PW-9 Aman Shravan Sontakke Seizure Witness Office of Coal Controller, PW-10 Chandan Bandhopadhyay KOLKATA PW-11 Kirtan Chandra Modak PW-15 R.K. Sutradhar CBI PW-16 DSP S.P. Rana PW-20 DSP Himanshu Bahuguna (Main IO) PW-21 DSP Sanjay Sehgal (IO) PW-22 DSP K.L.Moses FROM M/s JLD OR RELATED COMPANIES
28. PW-1 Vinay Taneja is the person who had signed the application for allocation of coal block on behalf of the A-1 company. He deposed that he CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 22 of 405 had joined M/s Corporate Ispat Alloys Ltd. ("CIAL") on 02.06.2006 as an Officer. He used to do the work as was assigned to him by Dr. Vidya Sagar Garg who was a Director of the said company. He was well acquainted with his handwriting and signatures and could identify the same. He told that A-2 Manoj Jayaswal was the Chairman of the said company. PW-1 worked in M/s CIAL till about June 2009. Immediately thereafter, he shifted to M/s Jayaswal NECO Industries Ltd. which was a company of Abhijeet Group.
29. He deposed that while working in M/s CIAL, he had signed the application for allocation of coal block of the company M/s JLD Yavatmal Energy Ltd. as the said application was to be submitted to MoC. He was given the authority letter to sign the said application on behalf of M/s JLD Yavatmal Energy Ltd. by Sh. A.B.P. Kesan, Company Secretary of the said company. However, he also told that he had never been an employee of M/s JLD Yavatmal Energy Ltd.
30. He identified his signature on the application for allocation of Fatehpur East Coal Block submitted by M/s JLD Yavatmal Energy Ltd. [as available in D-3], and the forwarding letter [available from page 2-8]. The covering letter dated 05.01.2007 is Ex. PW 1/A. The main application form from page 4-8 is Ex. PW 1/B. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 23 of 405
31. He also identified his signatures on the authority letter dated 05.01.2007 and that of Sh. A.B.P. Kesan, Company Secretary [as is available at page 11]. He also told that alongwith the application a letter of IDFC in favour of M/s JLD Yavatmal Energy Ltd. was also annexed [as is available at page 9]. The documents alongwith the list as above and the authority letter beside the letter of IDFC are collectively Ex. PW 1/C (colly) [from page 9-606 (D-3)].
32. He deposed that the letter dated 09.01.2007 of IDFC [as available at page No. 9], was given to him by Dr. V.S. Garg. The application as above was prepared by him as per the information given to him by Dr. V.S. Garg and Sh. Harshad Pophali. He himself had submitted the aforesaid application with MoC, Govt. of India.
33. He further deposed that prior to the submission of aforesaid application with MoC, M/s CIAL was already allotted a coal block namely "Chitrapur" and M/s Abhijeet Infrastructure Ltd. was already allotted "Brinda", "Sisai" and "Miral" coal blocks. M/s Jayaswal NECO Industries Ltd. was also already allotted three coal blocks i.e. "Gare Palma-IV/4", "Gare Palma-IV/8"
and "Moitra" coal blocks.
34. As per his memory, M/s CIAL and M/s Abhijeet Infrastructure Ltd. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 24 of 405 were part of Abhijeet Group of companies. He stated that Sh. Manoj Jayaswal used to look after the affairs of Abhijeet Group of Companies. M/s Jayaswal NECO Industries Ltd. belonged to Sh. Basant Lal Shaw.
35. Regarding information furnished at point number 30 of application Ex. PW1/B wherein information was sought regarding earlier allocation of blocks to "Group or Associated Companies" and which was given as "No", the witness was asked the reason therefor. The witness stated that he did not understand the meaning of group or associated company and he mentioned the word "No" as per the direction given by Sh. Harshad Pophali and Dr. V.S. Garg.
36. PW-1 identified signature of Dr. V.S. Garg on a letter dated 13.07.2007 addressed to Director, Office of the Coal Controller, as available in D-43. The letter alongwith its enclosures as above is Ex. PW 1/D (colly) (D-
43). He also identified signature of Dr. V.S. Garg on a letter dated 02.10.2007 addressed to Deputy Assistant, Coal Controller, Kolkata as available in D-44. The letter alongwith its enclosures as above is Ex. PW 1/E (colly) (D-44).
37. In cross-examination on behalf of A-1 to A-4 he admitted that even on that day i.e. the day of cross-examination, he did not understand the meaning of the words "Group or Associated Company". He admitted that while signing CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 25 of 405 the covering letter Ex. PW 1/A or the application Ex. PW 1/B, he did not commit any illegal act as he was acting under the authorisation issued by the Company Secretary A.B.P. Kesan. He was not sure as to whether any information mentioned in covering letter dated 05.01.07 Ex. PW1/A was correct or not when he signed it as the same was prepared as per the information given to him by Sh. Harshad Pophli and Dr. V.S. Garg.
38. He denied that the covering letter Ex. PW1/A and application Ex. PW1/B were signed and filled up by him respectively on the instructions of Sh. A.B.P. Kesan or that he himself verified the information so furnished from the documents annexed therewith.
39. He told that he had no personal knowledge of the information contained in the enclosures of letter Ex.PW1/D (Colly) and Ex.PW1/E (Colly) signed by Dr. V.S. Garg. He had no knowledge as to who had prepared the said annexures or who had enclosed them with the said letters.
40. PW-2 Sh. Harshad Pophali had joined M/s CIAL in 2005 and resigned from the company in January 2014. He told that Sh. Manoj Kumar Jayaswal was the Chairman of the company and Sh. Abhishek Jayaswal was the Group Managing Director. He told that since he was working in the mining CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 26 of 405 division so he used to report to Dr. V.S. Garg who was heading the mining division in the company and was also a director of the company.
41. He told that he knew about M/s JLD Yavatmal Energy Ltd. as the said company was incorporated primarily to implement a power project. He also told that an application for seeking allocation of a coal block in favour of M/s JLD Yavatmal Ltd. was prepared in their mining department of M/s CIAL and the same was signed by Sh. Vinay Taneja. As the entire matter regarding preparation of the application used to be discussed in the department so the information as was furnished over there was as per the discussion which Dr. V.S. Garg used to have with Sh. Manoj Kumar Jayaswal. Sh. Vinay Taneja was working under Dr. V.S. Garg.
42. He also deposed about previous allocation of coal blocks as deposed by PW-1.
43. He told that Sh. Basant Lal Shaw was the Chairman of Jayaswal Neco Industries Ltd. and infact he was the Group Chairman of Neco Group. There are number of other companies which are also part of "Neco Group" such as M/s Neco Ceramics Ltd., M/s Maa Usha Urja Ltd. etc.
44. He deposed that Manoj Kumar Jayaswal was looking after the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 27 of 405 affairs of M/s Corporate Ispat Alloys Ltd., M/s Jas Infrastructure Capital Ltd., M/s Abhijeet Infrastructure Ltd. and other companies. The said companies were thus part of "Abhijeet Group".
45. He deposed that while filling up the application and the covering letter of M/s JLD Yavatmal Energy Ltd., he used to give information to Sh. Vinay Taneja as per the information which used to be given to him by Dr. V.S. Garg and Sh. Manoj Kumar Jayaswal. Witness stated that there used to be discussion in the department itself regarding the application.
46. Regarding information mentioned at point no. 30 in the application Ex.PW1/B where the word "No" has been mentioned in respect of previous allocation to "Group or Associated Company", the witness stated that the said information was given to him by Dr. V.S. Garg and Sh. Manoj Kumar Jayaswal and he accordingly conveyed the same to Sh. Vinay Taneja.
47. He deposed that he also knew Sh. Sanjay Dey as he was also working in Abhijeet Group but did not remember as to at what post or specifically in which company he was employed. He however used to deal with matters relating to company i.e. Company Secretariat.
48. He could remember that certain mails were exchanged between CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 28 of 405 himself and Sh. Sanjay Dey relating to the presentation to be made before the Screening Committee, MoC, Govt of India.
49. He deposed that a presentation to be made on behalf of the company before the Screening Committee was prepared in their department beside the feedback form to be submitted before the Screening Committee. Both the said documents were prepared as per the instructions given by Sh. Manoj Kumar Jayaswal and Dr. V.S. Garg. Witness further stated that the said feedback form and presentation were sent by him to Sh. Sanjay Dey by e-mail. At that time the e-mail ID used by him was "[email protected]" and the same was sent to Sh. Sanjay Dey at "[email protected]" as Cc and the mail was addressed to Sh. Krishnan who was a director in one of the company in Abhijeet Group only at his e-mail ID "[email protected]".
50. The printout of said e-mail Id alongwith copy of presentation and feedback form [as is available from page 12 to 20 in D-15] is Ex. PW2/A(colly).
51. In cross-examination on behalf of A-1 to A-4, PW-2 too did not understand the meaning of the term "Group or Associated Company". He denied that he had wrongly stated that in filling up the application or the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 29 of 405 preparation of presentation and feedback form, he acted on the instructions given by Dr. V.S. Garg and Manoj Kumar Jayaswal. He was confronted with his statement u/s 161 Cr.PC Ex. PW 2/DX-1.
52. PW-3 Sh. Sanjay Dey deposed that he was a qualified Company Secretary. He was working as Senior Vice President and Company Secretary in M/s Adhunik Mettaliks Limited since 2014. Prior to that, he was working in Jindal Steel and Power Limited, Mauritius from 2013 till 2014. Prior to that, he was working as Director General in M/s Abhijeet Gabon Power SA from 2011 till 2013. Prior to that, he was working as Company Secretary and Vice President in M/s Abhijeet Power Limited.
53. He deposed that in M/s Ahbijeet Power Limited, the Chairman of the company was Sh. Manoj Kumar Jayaswal whom he identified. He also told that there was no Managing Director at that time in the company. He also told that he had joined the said company in 2010. Prior to that, he was working in M/s CIAL and prior to that he was working in M/s Jas Toll Road Company Ltd.
54. He deposed that he joined M/s Jas Toll Road Company Ltd. in 2001 as Company Secretary and Assistant Manager. Thereafter, he was transferred to M/s CIAL in 2004. He told that Sh. Manoj Kumar Jayaswal was the Chairman CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 30 of 405 of both M/s CIAL and M/s Jas Toll Road Company Ltd. In M/s CIAL, he was working as Vice President of the Company and as well as Company Secretary thereof. He remained in M/s CIAL till 2009 when he was transferred to M/s Abhijeet Power Ltd.
55. Witness further stated that M/s Jas Toll Road Company Ltd., M/s CIAL and M/s Ahbijeet Power Limited were part of same family company or group company.
56. He deposed that when he joined M/s Jas Toll Road Company Ltd. in 2001, then the said company alongwith various other companies was part of one group of family company headed by Sh. Basant Lal Shaw and the said companies were commonly known as "NECO Group of Industries". During the period 2006-08, a split in the Basant Lal Shaw family took place and the various companies came to be categorised under two separate heads i.e. "NECO Group of Industries" and "Abhijeet Group of Industries". Witness further stated that "Abhijeet Group of Industries" had come into existence prior to the said formal split in the family.
57. With regard to the said family settlement certain documents were executed between the family members of Basant Lal Shaw. As far as he CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 31 of 405 remembered, one of the document was called "Vyavastha Patra" and another was "Indenture of Family Settlement".
58. After seeing a memorandum of understanding dated 31.03.2006 (available in D-21), witness stated that the said MOU which was executed between family members of Basant Lal Shaw i.e. Basant Lal Shaw, Arbind Jayaswal, Ramesh Jayaswal as one party and Sh. Manoj Jayaswal, Sh. Anand Jayaswal, Sh. Abhishek Jayaswal and Sh. Avnesh Jayaswal as the second party had come before him during the course of discharge of his official duties while working in M/s CIAL. He identified signatures of witness number 1 Sanjay Kathane on that document. PW-3 also identified signatures of Basant Lal Shaw, Arbind Jayaswal, Ramesh Jayaswal, Manoj Jayaswal, Anand Jayaswal, Abhishek Jayaswal and Avnesh Jayaswal. The MOU is Ex. PW 3/A (D-21).
59. As per the said MOU, the various family companies were divided under NECO Group of Companies and Abhijeet Group of Companies:
Neco Group of Companies Abhijeet Group of Companies
1. Jayaswals Neco Limited 1. Abhijeet Infrastructure Limited
2. Neco Castings Limited 2. Corporate Ispat Alloys Limited CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 32 of 405
3. Jayaswal Holdings Private 3. JAS Toll Road Company Limited Limited
4. Neco Ceramics Limited 4. Jayaswals Ashoka Infrastructure Private limited
5. NSSL Limited 5. Chitarpur Coal and Power Limited
6. Maa Usha Urja Limited
60. He further told that the company M/s JLD Yavatmal Energy Ltd. was incorporated in the year 2006. Manoj Kumar Jayaswal, Abhishek Jayaswal, Anand Jayaswal, Vijay Darda, Devendra Darda and Rajendra Darda were the directors of said company.
61. The shares of the company were held by the aforesaid persons besides also by Smt. Karishma Jayaswal W/o Anand Jayaswal. The shares were held by Jayaswal family and Darda family as above in the ratio of 50:50.
62. He deposed that he knew Sh. A.B.P. Kesan as he too was working as Company Secretary of M/s JLD Yavatmal Energy Ltd. PW-3 was well acquainted with signature of Sh. Kesan, Sh. Vijay Darda and Devendra Darda.
63. After seeing D-51, containing documents relating to incorporation of M/s JLD Yavatmal Energy Ltd. and other subsequent communications and CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 33 of 405 documents relating to the company, and after seeing the Memorandum of Association and Articles of Association of M/s JLD Yavatmal Energy Ltd. [as is available from page 234-280], he identified signatures of Sh. Vijay Darda, Devendra Darda, Manoj Jayaswal, Anand Jayaswal, Abhishek Jayaswal and Mrs. Karishma Jayaswal on both the set of documents and that of Sh. A.B.P. Kesan. The Memorandum of Association and Articles of Association is Ex. PW 3/B (colly) (D-51). The application for incorporation of the company is Ex. PW 3/C. The applications for consent to act as Director are Ex. PW 3/D (colly). The file D-51, is Ex. PW 3/E (colly) (page 1-328) (D-51).
64. He deposed that the company M/s JLD Yavatmal Energy Ltd. was incorporated primarily to carry out mining business and generation of power beside other purposes as are mentioned in Memorandum of Association. In order to establish the proposed power plant of M/s JLD, IDFC and Lokmat Group had also got associated with the company and in this regard a memorandum of understanding was also executed between the principal entities i.e. IDFC, Lokmat Group and Abhijeet Infrastructure Ltd. M/s JLD Yavatmal Energy Ltd. was primarily the vehicle through whom the proposed power plant was to be established.
65. The Lokmat Group was that of Sh. Vijay Darda. Witness further CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 34 of 405 stated that the aforesaid fact has been stated by him as per the common knowledge but he is not aware as to who all persons were there behind the said group on papers.
66. The MOU dated 27.12.2006 [as is available in D-7], was executed between M/s Abhijeet Infrastructure Ltd., M/s Lokmat Newspaper Pvt. Ltd. and IDFC. Witness further stated that on behalf of M/s Abhijeet Infrastructure Ltd. he had signed the said MOU at point A and Mr. Rishi Darda signed the same for Lokmat Group at point B and Mr. Vinayak Mavinkurve at point C for IDFC. The MOU is Ex. PW 3/F (D-7).
67. He also deposed that for signing the said MOU on behalf of M/s Abhijeet Infrastructure Ltd. he was authorized by Sh. Manoj Kumar Jayaswal. Prior to execution of the aforesaid MOU inter se discussions were held between the three executing entities as above. He also participated in some of the said discussions. On behalf of M/s Abhijeet Infrastructure Ltd. besides himself Sh. P.N. Krishnan and Sh. Manoj Kumar Jayaswal were principally involved in the said discussions. On behalf of Lokmat Group Sh. Vijay Darda and Sh. Devendra Darda were involved in the discussions. On behalf of IDFC, officers of their legal team were involved in the discussions and some of them were Aditya Aggarwal, Sh. Sachin Johari, Sh. Vinayak Mavinkurve. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 35 of 405
68. After seeing the MOU Ex.PW3/F witness stated that one of the principal term of the MOU was mentioned in clause 1.5 that Abhijeet Group and Lokmat Group have incorporated a SPV namely M/s JLD Yavatmal Ltd. for undertaking/developing coal mining activities and to set up a coal based power plant of 1215 MW(Project) in Yavatmal District in the State of Maharashtra.
69. He referred to various clauses of the MOU such as clause 1.5, clause 1.6, clause 1.8, and clause 1.9 as per which Abhijeet Group and Lokmat Group were to be the lead members of the consortium and IDFC was to participate in its capacity as a financial investor.
70. He told that since M/s JLD /the SPV was a new company and so there were hardly any employees in the said company so all the work relating to preparation of application form and submission of the same on behalf of SPV was undertaken by consortium members.
71. The roles and responsibility of Abhijeet Group and Lokmat Group and that of IDFC were clearly spelled out in clause 3 as under:
3. Roles and Responsibilities a. Prior to allotment of coal block i. Abhijeet Group and Lokmat Group shall take primary CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 36 of 405 responsibility for identifying viable coal blocks finanlizing project sites for setting up the power plants liasoning/engaging with State Govt. / state mining corporations etc. so as to obtain State Govt.
recommendation for coal block which would enable setting up of power plants, preparation of pre-feasibility report Preparation of final submissions for coal bids. ii. IDFC shall support the coal application bid process by way of
(a) conducting an appraisal of the proposed end-use Project
(b) providing a letter of support/commitment for financing the Project
(c) subscribe to 20% of the equity of the SPV which shall be capped to Rs. 5 lakhs in aggregate at this stage.
(d) In the event of allocation of coal block to the SPV, IDFC shall subscribe to 20% of the paid up equity share capital of the SPV.
All expenses and costs prior to allotment of the coal block would be borne by Abhijeet Group and Lokmat Group, save and except IDFC's contribution of Rs. 5 lakhs towards equity share capital of the SPV.
72. As regard the management and control of the SPV, it was stated in the MOU Ex.PW3/F in clause 2(e) as under:
2(e) Abhijeet Group and Lokmat Group shall undertake to maintain their collective stake to the extent of at least at 51% and retain management control of SPV at all times.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 37 of 405
73. Witness further stated that as regard management and business of the SPV was concerned the same was referred to in clause 1.6 and as regard management and control of the SPV the same is referred to in clause 2(e). Witness further stated that in clause 2 titled "Equity Holding and Management Structure" it was inter-alia mentioned as under:
SPV shall be managed and controlled by the Board and the Board shall be responsible for the overall policies and objectives and activities of the Company, in terms of its Memorandum of Association and Articles of Association, the provisions of the Companies Act, 1956 and the SHA. Abhijeet Group, Lokmat Group and IDFC shall each have the right to nominate Director (s) on the Board of the SPV in proportion of the equity share capital held by each. IDFC shall have certain affirmative and negative rights. The indicative rights set out in the Annexure I and II shall form the basis for detailed negotiations on the SHA.
74. Attention of the witness was drawn to point 6 of the application Ex.PW1/B of M/s JLD Yavatmal Energy Ltd. as submitted to MoC, wherein the following facts were mentioned:
6.Core Business Power Generation: considering the power deficit in Maharashtra State and growing demand for power, JLD has been jointly established by Lokmat Group and Industrial Development Finance Company Limited to implement the 1215MW Power Plant in the backward Yavatmal district of Vidharba Region in Maharashtra. JLD is promoted, controlled & managed by Lokmat Group and Infrastructure Development Finance Company Limited (IDFC,) the leading Financial Institution specifically incorporated for development of Infrastructure Sector including CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 38 of 405 Power Generation.
75. Witness was asked as to whether the aforesaid facts mentioned in the application were in consonance with the MOU Ex.PW3/F or not. The witness after referring to the application as above and the MOU stated that the facts mentioned in the application in column 6 are not as per the MOU. Witness further stated that since the words "Promoted", "Controlled" and "Managed" have been mentioned in the application in column 6 which are though not as per the MOU but he is not aware of the background documents if any on the basis of which the said words have been mentioned in the application.
76. The MOU Ex.PW3/F at page no. 3 further recorded as under:
1. The Parties hereby record the terms of their agreement in respect of: (i) the Project Development Agreement ("PDA") to be entered into between the Parties with respect to the Project; and (ii) the principle terms of the Shareholders' Agreement ("SHA"), which will form an integral part of the PDA, within 180 days of signing of this MOU, or any other extended date as may be mutually agreed between the Parties (the "Discussion Period").
This MOU, creates legally binding obligations of the Parties on certain key terms of the PDA and/or SHA as are laid down herein. Any other terms that any Party may want to consider as part of the PDA and/or SHA, shall be further discussed, elaborated, and agreed on between the Parties during the Discussion Period.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 39 of 405
77. It was thus stated that the principal terms of the shareholders agreement would form an integral part of PDA and which was to be signed within 180 days of the said MOU or any other extended date as may be mutually agreed between the parties. According to PW-3, no such agreement was ever executed between the parties. However the period of 180 days was subsequently extended vide letter/document D-14 dated 26.06.2007to another period of 180 days from 26.06.07 or till the execution of the PDA, which ever was later. The letter dated 26.06.07 is Ex.PW3/G (D-14).
78. He deposed that prior to submission of application Ex.PW1/B to MoC, Govt of India a number of coal blocks were already allocated to M/s Corporate Ispat Alloys Ltd. and M/s Abhijeet Infrastructure Ltd.
79. "Chitarpur coal block" was already allotted to M/s Corporate Ispat Alloys Ltd. and "Brinda Sisai" and "Miral coal blocks" were already allotted to M/s Abhijeet Infrastructure Ltd.
80. Gare Palma IV/4, Gare Palma IV/8 and Moitra Coal blocks were already allocated to M/s Jayaswal Neco Industries Ltd.
81. During the said period he was having two e-mail IDs i.e. [email protected] and [email protected]. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 40 of 405
82. With respect to the application of M/s JLD as submitted to MoC, he appeared before Screening Committee MoC during the course of presentation on behalf of the company. At that time he accompanied Mr. Devendra Darda, Sh. Aditya Aggarwal and Sh. Vinayak Mavinkurve.
83. Sh. Aditya Aggarwal and Sh. Vinayak Mavinkurve were on behalf of IDFC but he was not able to recall now as to whether Sh. Devedra Darda was present on behalf of M/s JLD or on behalf of M/s Lokmat Group.
84. The attendance sheet [available from page 67 to 75 in D-23] is Ex.PW3/H.
85. He told that the presentation on behalf of JLD company was made by Sh. Devendra Darda.
86. He stated that hard copy of the presentation which was made before the Screening Committee was circulated by them to all the members of Screening Committee but he was not aware about any feedback form if circulated on behalf of M/s JLD to the members of Screening Committee or not or submitted over there or not.
87. He identified signature of A-4 Devender Darda on "Form for CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 41 of 405 feedback" [as is available from page 277-278 in D-38]. The feedback form is Ex. PW 3/J (D-38). The original feedback form is Ex. PW 3/J-1.
88. He deposed that he had number of correspondence with IDFC relating to presentation to be made on behalf of M/s JLD.
89. At this stage upon being shown printout of various e-mails as is available in D-15, witness stated that the said e-mails were exchanged between him and Aditya Aggarwal, Sachin Johri, officers of IDFC and also with Abhishek Jayaswal, P.N. Krishnan, Vinita Sinha, Vinayak Mavinkurve, Vikram Limaye and M.K. Sinha regarding the presentation which was to be made before the Screening Committee on behalf of M/s JLD.
90. The printouts of various e-mails were exhibited as under:
"a. E Mail dated June 14, 2007 regarding presentation before the Screening committee from Sanjay Dey to Aditya Agarwal & Ors. along with the attachment of draft presentation (Number of pages
8.) is Ex. PW3/K-1(colly)(D-15).
b. E Mail dated June 14, 2007 regarding presentation before the Screening committee from Aditya Agarwal to Sanjay Dey & others is Ex. PW3/K-2(D-15).
c. E Mail dated June 19, 2007 regarding presentation before the Screening committee from Aditya Agarwal to PN Krishnan & others is Ex. PW3/K-3(D-15).
d. E Mail dated June 20, 2007 at 08:35 pm regarding JLD presentation Sanjay Dey to Aditya Agarwal alongwith CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 42 of 405 the attachment of the draft presentation (Number of pages 9) is already exhibited as Ex.PW2/A. e. E Mail dated June 21, 2007 at 07:16 AM regarding draft presentation to Screening committee from Aditya Agarwal to Sanjay Dey & others is Ex.PW3/K-4(D-15).
f. E Mail dated June 22, 2007 regarding Meeting Notes 21/06/2007 from Aditya Agarwal to Vinayak Mavinkurve, Sachin Johri, MK Sinha, Vikram Limaye and others is Ex.PW3/K-5(D-
15)."
91. Initially he did not remember the name of the coal block allocated to M/s JLD but later on told its name as Fatehpur East.
92. He deposed that he was acquainted with the handwriting and signatures of Sh. P.N. Krishnan as he was working as Director (Finance) in Abhijeet Infrastructure Ltd. and the offices of the Abhijeet Group of Companies was common and thus he had worked alongside him in Abhijeet Group of Companies and was thus well acquainted with his handwriting and signatures.
93. He identified signature of Sh. P.N. Krishnan on letter dated 29.11.2007 addressed to Secy. (Coal), Govt. of India alongwith a joint venture agreement dated 29.11.2007 executed between M/s JLD Yavatmal Energy Ltd., R.K.M. Powergen Pvt. Ltd., Visa Power Ltd., Green Infrastructure pvt. Ltd. and Vandana Vidhyut Ltd. [as is available from page 243-267]. The letter dated CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 43 of 405 29.11.2007 is Ex. PW 3/L and the joint venture agreement is Ex. PW 3/L-1 (D-26).
94. After the submission of aforesaid joint venture agreement to MoC, a joint allocation letter dated 22/23.01.2008 in the name of aforesaid five companies was issued by MoC and witness states that while working in Abhijeet Group he had seen the same. The letter is Ex. PW 3/M. (available from page 274-279 in D-26)
95. He deposed that A-2 Manoj Kumar Jayaswal had authorized him to attend the Screening Committee meeting at the time of presentation on behalf of M/s JLD Yavatmal Energy Ltd. He further deposed that he was never an employee of M/s JLD Yavatmal Energy Ltd. Upon being asked as to why the witness wrote his designation as Vice President against the organization JLD Yavatmal Energy Ltd. in the attendance sheet Ex. PW3/H signed by him before the Screening Committee, the witness stated that since he was the vice president in the Abhijeet Group so he wrote his designation as such and as Company Secretary he was associated with one specific company i.e. M/s Corporate Ispat Alloys Ltd.
96. After seeing indenture of family settlement dated 31.07.2008 as is CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 44 of 405 available from page 1 to 39 in D-49, witness stated that the said indenture of family settlement was executed amongst Sh. Basant Lal Shaw and his three sons namely Arbind Kumar Jayaswal, Manoj Kumar Jayaswal and Ramesh Kumar Jayaswal. In order to ensure that no dispute may arrise in future, all the other family members i.e. the spouses and children of the executants of the aforesaid indenture of family settlement also signed the same at page 38 as a token of their confirmation to the same.
97. Witness identified signatures of Sh. Basant Lal Shaw, Arbind Jayaswal, Manoj Jayaswal, Ramesh Jayaswal on the said indenture. The indenture of family settlement is Ex. PW 3/N (D-49).
98. As per the said indenture of family settlement Ex. PW 3/N, M/s JLD Yavatmal Energy Ltd. had come to the share of "BLS Group" i.e. that of Sh. Basant Lal Shaw as is mentioned in the 4 th schedule of the family settlement. The companies mentioned in the 5 th schedule of the settlement were to come to the share of "MKJ Group" i.e. of Manoj Kumar Jayaswal.
99. He told that After the execution of said indenture of family settlement a process was started for transfer of shareholding in each of the companies so as to comply with the indenture of family settlement. As per his CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 45 of 405 knowledge some of such agreements for transfer of share holding were executed but qua some certain disputes arose.
100. An agreement for transfer of equity shares of JLD Yavatmal Energy Ltd. to BLS Group [as is available from page 1-8 in D-48], was prepared by him and also bears his signatures as a witness alongwith two arbitrators namely Sh. Sohan Chaturvedi and Sh. B.K. Aggarwal. The said agreement was signed by Sh. Basant Lal Shaw, Arbind Jayaswal, Ramesh Jayaswal, Anand Jayaswal, Karishma Jayaswal, Manoj Jayaswal, Abhishek Jayaswal, Vijay Darda, Rajendra Darda, Devendra Darda and also by Manoj Jayaswal on behalf of company M/s JLD. The agreement is Ex. PW 3/O (D-48).
101. He told that in the MOU dated 27.12.2006 Ex.PW3/F there was restrictions on transfer of shares on the shareholdings of the shareholders of the SPV. The same were mentioned in clause 10 of the MOU as under:
"10. Transfer Restrictions In the event that any shareholders of the SPV intends to sell its equity shareholding (the Selling Shareholders) in the SPV , the Selling Shareholders shall offer its equity share holding (the Sale Shares) to the other shareholders in the SPV (the Purchasing Shareholder) in proportion to their shareholding in the SPV. The Purchasing Shareholder shall communicate its intention to purchase within 7 days of such offer by the Selling Shareholders and in the event of acceptance of the offer of the Selling Shareholders shall remit the Consideration for purchase of such Sale Share forthwith to the designated bank account of the Selling Shareholders. In case of part acceptance by the Purchasing Shareholders, the balance of the Sale Shares shall be offered to the other CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 46 of 405 Shareholders on the same terms as it was earlier offered. If no intimation is received from the Purchasing Shareholders in accordance with time stipulated herein, the Selling Shareholders may sell the Sale Shares to other third person, however that the terms of such sale shall not be more favourable in any manner to the terms originally offered to the other shareholders of the Company. In such an event the Selling Shareholders shall offer the more favorable terms to the other existing shareholders of the SPV and the process of sale mentioned herein shall be repeated.
Notwithstanding the above, the Parties hereto agree and confirm that IDFC may at its option sell and/or transfer its equity shareholding in the SPV to any of its Affiliates and/or Associates. Subject to the provisions of clause 2 (c) above Abhijeet Group ad Lokmat Group shall also be at liberty to transfer their equity Shareholding in the SPV inter se as well as between its Associates and Affiliates."
102. Further the MOU also defines the meaning of the words "affiliate" and "associates" at page 5 as under:
"Affiliate" shall mean a subsidiary or holding company or any subsidiary of any such holding company or any entity, which controls, is controlled by, or is under the common control of any or all of the above entities or any fund or entity managed by IDFC.
"Associates" means in relation to any Party, a person who controls, is controlled by, or is under the common control with such Party. As used in this definition, the expression "control" means with respect to a person which is a corporation, the ownership, directly or indirectly, of more than 50% of the voting shares of such person or the ability to appoint the majority of Directors on the Board of Directors and with respect to a person which is not a corporation, the power to direct the management and policies of such person, whether by operation of law or by contact or otherwise."
103. As per his knowledge IDFC was never informed about transfer of their equity shareholding in M/s JLD Yavatmal Energy Ltd. by Abhijeet Group CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 47 of 405 and Lokmat Group. Till the time the equity shareholding in M/s JLD was transferred by Abhijeet Group and Lokmat Group vide agreement dated 02.03.09 Ex.PW3/O no one from IDFC was inducted as a director in M/s JLD Yavatmal Energy Ltd and even no shareholding was issued in the company in favour of IDFC.
104. He referred to four letters dated 30.04.09 [available from page 28 to 31 in file Ex.PW3/E (colly)] and identified the signatures of Sh. Vijay Darda, Sh. Devendra Darda, Sh. Manoj Jayaswal and Sh. Abhishek Jayaswal at point A on the four letters and stated that vide the said letters addressed to the Board of Directors JLD Yavatmal Ltd. the aforesaid four persons had resigned from the directorship of the company. The four letters as above are Ex.PW3/P-1, Ex.PW3/P-2, Ex.PW3/P-3 and Ex.PW3/P-4 respectively.
105. He told that Sh. A.B.P. Kesan resigned from the position of Company Secretary of the company JLD vide a letter dated 06.04.09 which is Ex.PW3/P-5.
106. He referred to various letters of Sh. Vijay Darda written to various authorities such as the President of India, the Prime Minister Dr. Manmohan Singh and the then Power Minister Sh. Sushil Kumar Shinde. He identified CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 48 of 405 signatures of Sh. Vijay Darda on all such letters. The letter dated 18.06.2007 is Ex.PW3/Q-1; The letter dated 19.06.2007 is Ex.PW3/Q-2; The letter dated 06.08.2007 is Ex.PW3/Q-3; The letter dated 05.09.2007 is Ex.PW3/Q-4; The letter dated 14.09.2007 is Ex.PW3/Q-5; The letter dated 17.09.2007 is Ex.PW3/Q-6; The letter dated 22.09.2007 is Ex.PW3/Q-7, The letter dated 14.09.2007 is Ex.PW3/Q-8, The letter dated 22.09.2007 is Ex.PW3/Q-9, The letter dated 01.10.2007 is Ex.PW3/Q-10, The letter dated 22.10.2007 is Ex.PW3/Q-11, and The letter dated 06.11.2007 bearing signatures in green ink is Ex.PW3/Q-12. (There was objection to the mode of proof. The objection is overruled as witness had identified signature of Vijay Darda).
107. He told that at the time of presentation before Screening Committee Sh. Manoj Kumar Jayaswal was not present.
108. In cross-examination on behalf of A-1 to A-4, he denied that he was not authorized by Manoj Kumar Jayaswal to sign the MOU. He admitted that as per MOU dated 27.12.2006 [Ex.PW3/F], IDFC was not only to participate in the consortium as a financial investor but was also to take part in the management and business of the SPV. He admitted that IDFC was also to support the coal application bid process in terms of the details mentioned in clause 3(a)(ii). He admitted that IDFC was also having right to nominate CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 49 of 405 directors on the board of the SPV and that it was also having both affirmative and negative rights as were mentioned in detail in annexure-I and annexure-II to the MOU. Clause 5 of MOU as is under:
"5. Affirmative and Negative Rights:
a. Abhijeet Group and Lokmat Group agree that, subject to any additional requirements imposed by any applicable law and notwithstanding anything contained in this MOU, during the term of the Project, Abhijeet Group and Lokmat Group shall not and shall procure that the SPV does not, without the affirmative written consent or approval of IDFC, obtained at a validity convened board meeting of the SPV, take any of the actions set forth in Annex I hereto (the "Affirmative Vote Items").
b. Abhijeet Group and Lokmat Group agree that, without the prior written permission of IDFC, it shall not perform / undertake any of the following activities as specified in Annex II hereto ("Negative Covenants").
c. These will be detailed and potentially expanded in the SHA to be agreed between the Parties."
109. He was confronted confronted with his statement u/s 161 dated 04.01.2013 wherein nothing is mentioned about the emails exchanged at the time of execution of MOU dated 27.12.06. The statement u/s 161 is Ex.PW3/DX-1.
110. Witness was asked as to what was the necessity of effecting changes in the presentation as was enclosed by him alongwith his e-mail dated 14.06.2007 [Ex. PW 3/K-1 (colly)] and the one stated to be finalized CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 50 of 405 presentation and feedback form as enclosed with e-mail dated 20.06.2007 [Ex. PW 2/A]. He told that he was only acting as a bridge in the communications which were being held with IDFC by Abhijeet Infrastructure Ltd. and he himself was not the originator of the said presentation in as much as the said presentation was not prepared by him and he used to only send the presentation to IDFC in the same form as used to be received by him in the office and he was not aware of the discussion which took place between the draft presentation and the finalized presentation.
111. He told that the final approval of the presentation on behalf of Abhijeet Infrastructure Ltd. was to be made by Manoj Kumar Jayaswal only.
112. He denied that he was responsible for approving the draft of presentation as well as for signing and submitting the feedback form to the Screening Committee or was also responsible for any changes to be effected in the presentation or in the feedback form.
113. He told that neither during the course of presentation nor before or after the presentation, the IDFC officers who were accompanying us to the Screening Committee pointed out any mistake in the presentation. He told that IDFC officers never ever pointed out to him that the networth of IDFC could CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 51 of 405 not be used in the application submitted to MoC for allocation of coal block as being the networth of promoter of SPV M/s JLD Yavatmal Energy Ltd. or in the feedback form or in the presentation to be made before the Screening Committee.
114. He stated that in the MOU dated 27.12.2006 Ex. PW 3/F there is no discussion regarding networth of the companies and thus there was neither any embargo nor allowance in the said MOU regarding use of networth of IDFC by the SPV.
115. He admitted that in the MOU under Clause 1.7 the following facts are mentioned:
"1.7 : The Parties propose to apply through the SPV, for allocation of coal blocks situated in the state of Maharashtra and Chhattisgarh, on an exclusive basis."
116. Attendance sheet dated 22.06.07 [available from page 17-24 in D- 23] was exhibited as Ex.PW3/DX-2.
117. He was confronted with his statement u/s 161 CrPC Ex. PW3/DX-1 regarding various portions of his examination-in-chief.
118. PW-4 Murli Lahoti deposed that he was working in the Company CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 52 of 405 Secretary Department of M/s. Jayaswal Neco Industries Ltd. Nagpur, since November 2008.
119. He deposed about handing over documents to CBI on two occasions. On one occasion he gave the documents at Delhi and on the second occasion he gave the documents at Nagpur.
120. He identified his signature on production-cum-seizure memo dated 02.05.2013 vide which he had handed over a MOU dated 31.03.2006 executed between Sh. Basant Lal Shaw and his family members. He identified the MOU Ex. PW-3/A (D-21) annexed with the memo to be the same which was handed over by him to inspector Himanshu Bahuguna. The memo dated 02.05.2013 is Ex. PW-4/A (D-20).
121. He further identified his signature on a production-cum-seizure memo dated 08.05.2013 at point A and deposed that vide the same, he had handed over two agreements dated 02.03.2009 executed regarding transfer of equity shares of M/s. JLD Yavatmal Energy Ltd. to BLS Group and Indenture of family settlement dated 31.07.2008 of Sh. B.L Shaw and family members. Witness has also identified the agreement for transfer of equity shares of M/s. JLD Yavatmal Energy Ltd. to BLS Group Ex. PW-3/O (D-48) annexed with the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 53 of 405 memo and Indenture of family settlement dated 31.07.2008 of Sh. B.L Shaw and family members Ex. PW-3/N (D-49) to be the same which were handed over by him to inspector Himanshu Bahuguna. The memo dated 08.05.2013 is Ex. PW-4/B (D-47).
122. Nothing has come out in cross-examination.
123. PW-8 Sh. Vivek Kumar had worked as Company Secretary in Abhijeet Power Ltd. from September 2010 till March 2013. He told that during this period though he worked as Company Secretary of one or the other company but all those companies including Abhijeet Power Ltd. belonged to Abhijeet Group of Companies. The said other companies were Abhijeet MADC Nagpur Energy Pvt. Ltd. and Jas Infrastructure Pvt. Ltd.
124. He deposed that Sh. Manoj Kumar Jayaswal was the Chairman of all the aforesaid companies. He told that during the course of investigation, he had handed over certain documents to CBI. The said documents were handed over during the course of a search operation carried out by CBI in September 2012.
125. After seeing a receipt memo dated 04.09.2012 as available in D-6, witness stated that vide the said memo he had handed over various documents, CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 54 of 405 the details of which are mentioned in the memo to Insp. Sanjay Sehgal of CBI. The witness has also identified his signatures at point A. The memo is Ex. PW 8/A (D-6).
126. The witness has also identified the documents as are available in D- 7, D-8, D-9, D-10 and D-11 to be the documents which were handed over by him to the CBI vide the said memo. The details of the documents so handed over by the witness are as under:
(i) Original Memorandum of Understanding dated 27.12.2006 between M/s Abhijeet Infrastructure Ltd and M/s Lokmat Newspapers Private Limited and IDFC Limited containing pages 1 to 6. (Already exhibited as Ex. PW 3/F (D-7))
(ii) Photocopy of Application dated 05.01.2007 of JLD Yavatmal Energy Limited submitted to Ministry of Coal, New Delhi, containing pages 1 to 8. (Exhibited as Ex. PW 8/B (D-8))
(iii) Photocopy of letter dated 26.07.2007 and 10.01.2008 of Sh.
Sushil Kumar Shinde, Minister of Power addressed to Sh. Vijay Darda, MP, containing pages 1 to 4. (Exhibited as Ex. PW 8/C (D-9))
(iv) Copy of presentation to the 35th Screening Committee, Ministry of Coal by JLD Yavatmal Energy Limited containing pages 1 to 13. (Exhibited as Ex. PW 8/D (D-10))
(v) Details of list of Bank Accounts of JAS Infrastructure & Power Limited and Manoj Jayaswal, Abhishek Jayaswal and Abhijeet Jayaswal - 2 pages. (Exhibited as Ex. PW 8/E (D-
11)) (Ld. Counsel had objected to the mode of exhibition of documents Ex. PW 8/B, Ex. 8/C, Ex. 8/D and Ex. 8/E. The objections are overruled.) CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 55 of 405
127. He deposed that prior to 2012, a number of coal blocks were already allocated to some companies belonging to Abhijeet Group of Companies such as M/s Corporate Ispat Alloys Ltd., Abhijeet Infrastructure Ltd. and M/s Jas Infrastructure Pvt. Ltd.
128. In cross-examination, he told that Abhijeet Group of Companies had no legal identity under Companies Act. He admitted that under Companies Act 1956, the word "Group" has not been defined anywhere but the words "holding company" or "subsidiary company" and "Associate company" has been defined.
FROM IDFC
129. PW-6 Aditya S. Aggarwal deposed that he was a partner in M/s IDFC Alternative i.e. a 100% subsidiary of IDFC (Infrastructure Development Finance Company).
130. He deposed that from April 2005 till April 2007, he was working as Lead Specialist in the Energy Group of IDFC. From April 2007 onwards he was transferred as Vice President to M/s. IDFC Alternative. In Energy Group of IDFC he was working under Sh. Vinayak Mavinkurve, Group Head Energy and in IDFC Alternative he was working under Sh. Sachin Johri, Managing Director. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 56 of 405
131. While working in Energy Group IDFC his job was to provide Debt and Equity financing to Energy projects which IDFC intended to support. In IDFC Alternative his job was to provide Equity financing to Infrastructure projects, which IDFC Alternative intended to support.
132. He deposed that he knew about Abhijeet Group as probably in 2004 or so IDFC had extended loan for some road project of Abhijeet Group. As far as he remembered, the Abhijeet Group was headed by Sh. Manoj Kumar Jayaswal.
133. He deposed that in the later part of year 2006 Ministry of Coal, Govt. of India had issued an advertisement inviting applications for allocation of captive coal blocks and in that connection IDFC was dealing with various companies who were interested in seeking allocation of captive coal blocks. In that regard Abhijeet Group had also approached to IDFC for financing of their power project.
134. He deposed that Sh. Abhishek Jayaswal also dealt / interacted with them during early days. He further told that in a couple of meetings in which he was present on behalf of IDFC alongwith other senior IDFC officials then in those meetings there was wider representation on behalf of Abhijeet Group and CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 57 of 405 Sh. Manoj Jayaswal was also present in the said meetings. Sh. Sachin Johri was also present in the said meetings on behalf of IDFC. He stated that there was a group of Abhijeet Group and Lokmat Group which was being represented by Abhijeet Group as a consolidated group.
135. He deposed that with regard to the power project a MOU was signed between IDFC and Abhijeet Group and Lokmat Group and on the day of signing of said MOU one person namely Sh. Rishi Darda had come on behalf of Lokmat Group.
136. Before the MOU as above was signed with Abhijeet and Lokmat Group the issue was discussed in the IDFC internally and the matter was discussed and approved by the decision board of IDFC. Minutes of the decision board meeting were duly prepared. The minutes of said meeting held 21.11.2006 [as are available from page 2-3 in D-16] contain as follows:
"3. Joint Bidding for Allocation of Coal Blocks. The proposal from Abhijeet group requesting IDFC to co-apply with them and the Lokmat group for seeking allotment of coal block(s) for the proposed 1200 MW power plant in Maharashtra was discussed along with a broader discussion on the project development role that IDFC can play in the power sector. The following views were expressed by the committee with regards to such initiatives :
IDFC at this point in time is short of resources who can be actively involved in the project development initiatives on a day to day basis and hence our efforts in this area need to be geared towards generating opportunities for passive financial investments.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 58 of 405 A strong concern was expressed on the possibilities of reputation risk that such joint bidding may involve and hence IDFC's participation in such ventures would need to be structured in a manner which would mitigate any such eventuality which would interalia include IDFC stepping in (in terms of actual capital flows) only at financial closure or close to the same.
Another main point of discussion was as to whether IDFC could tie-up with any other developer(s) for joint bidding (apart from the Abhijeet group) who would have stronger chances of getting the allotment with more advanced status of the end use plant/existing MOUs with the state Govts. etc. However it was felt that the scope of tying with any bigger, well know names would be lesser at the time of applying given the limited value proposition that IDFC would be able to bring to the consortium in case of a bigger/proven developers.
It was agreed that the deal team could have exploratory talks with the various developers to examine various possibilities besides Abhijeet group and then bring back a working proposition to the DB."
137. Witness upon being asked as to whether the witness has knowledge of the aforesaid minutes dated 21.11.2006 as above of decision board meeting of IDFC, witness replied in affirmative stating that he was present in the said meeting and the same records the discussion and decision which took place in the said meeting. The minutes as above are Ex. PW-6/A. (There was objection to the exhibiting of these minutes on the ground that witness did not identify signature of Sh. Ketan Kulkarni who had certified them and they were only extracts. The objection is overruled since accused persons themselves referred to this document later on.)
138. He identified signatures of Sh. Vinayak Mavinkurve and of Sh. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 59 of 405 Sachin Johri on letter dated 28.09.2012 addressed to CBI, EO Zone. The letter is Ex. PW-6/B (page 1 of D-16). He identified signature of Sh. Vinayak Mavinkurve on MOU dated 27.12.2006 Ex. PW-3/F (D-7) on behalf of IDFC. Another copy of said MOU as available in D-13 Ex. PW-6/C (D-13). He told that he was also involved in the discussion which led to finalization of the said MOU.
139. Upon being asked as to what was the role and responsibility of various parties to the MOU qua the power project to be established, the witness after referring to the MOU stated that IDFC was to participate in its capacity of a financial investor. He referred to Clause 3 of the MOU. The role and responsibilities have been further mentioned in Clause 3 of the MOU as under:
3. Roles and Responsibilities a. Prior to allotment of coal block i. Abhijeet Group and Lokmat Group shall take primary responsibility for
(i) identifying viable coal blocks
(ii) finalizing project sites for setting up the power plants
(iii) liasoning/engaging with State Govt./state mining corporations etc. so as to obtain State Govt. recommendation for coal blocks which would enable setting up of power plants,
(iv) preparation of pre-feasibility report
(v) preparation of final submissions for coal bids.
ii. IDFC shall support the coal application bid process by way of
(a) conducting an appraisal of the proposed end-
use Project CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 60 of 405
(b) providing a letter of support/commitment for financing the Project
(c) subscribe to 20% of the equity of the SPV which shall be capped to Rs.5 lakhs in aggregate at this stage.
(d) In the event of allocation of coal block to the SPV, IDFC shall subscribe to 20% of the paid up equity share capital of the SPV.
iii. All expenses and costs prior to allotment of the coal block would be borne by Abhijeet Group and Lokmat Group,save and except IDFC's contribution of Rs.5 lakhs towards equity share capital of the SPV.
b. Post allotment of coal mine to the Consortium
i. Abhijeet Group and Lokmat Group shall take the responsibility of
overseeing development, construction, operation and maintenance of the Project. Abhijeet Group will second SPV's employees, as it considers necessary, for fulfilling the SPV's responsibility. Lokmat Group will second SPV's employees, as it considers necessary, for fulfilling the SPV's responsibility. IDFC shall take the responsibility for the financing of the Project and second the employees of the SPV's for fulfilling the SPV's obligations.
ii. Abhijeet Group and Lokmat Group shall also ensure proper implementation of project agreements that may have been executed for the Project ("Project Document").
iii. IDFC shall be a financial investor and provide, as may be requested by Abhijeet Group and Lokmat Group, policy level, Govt. interface support and other support necessary for improving overall competitiveness and commercial viability of the Project.
iv. IDFC's shall carry out for the SPV :
(i) the financial advisory role exclusively;
(ii) debt syndication/arrangement role exclusively;
and
(iii) subject to due diligence and corporate
approvals, participate in the debt finance. IDFC shall also draft and finalize financing/security documents for the Project.
(iv) IDFC's shall be entitled to charge market based fees for these services which shall be recoverable through financial advisory fees (inclusive of debt syndication fees) shall be 0.50% of the total cost of the Project. The other terms and conditions for this role of IDFC shall CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 61 of 405 be covered in a separate mandate letter as per the prevalent terms in the market. IDFC, in close, coordination with the other Shareholders, will arrange the debt on an open market, book building route through a competitive bidding process."
140. The MOU further provides in other clauses as under:
"1.8 The SPV shall be responsible for a. Identifying the coal blocks for allotment to the SPV. b. Preparation of applications for allocation of coal block to be submitted to Ministry of Coal, Govt. of India. c. undertake project development activities for coal mining/power plant in even of a successful bid, and d. Design, engineering, financing, procurement, construction, operation and maintenance of the integrated captive mining cum coal based power plant as detailed above (Project). Abhijeet Group and Lokmat Group shall be the Lead Members of the Consortium while IDFC shall participate in its capacity as a financial investor."
"2. Equity Holding and Management Structure a. .... .... .... .... ... .... ....
.... .... .... .... ... .... ....
.... .... .... .... ... .... ....
IDFC shall not be required to provide any guarantee or any other support to any third party, including but not limited to the lenders to the SPV. IDFC shall not be required to Pledge its equity share holding in the SPV to the Lenders of the SPV, IDFC shall not be deemed to be or treated as the promoters or sponsors of the SPV for any purpose or reason whatsoever, including for the purposes of the IPO of the SPV and IDFC shall not be named as a promoter or sponsor in the prospectus or any other documents related to the IPO of the SPV; b. .... .... .... .... ... .... ....
c. .... .... .... .... ... .... ....
d. .... .... .... .... ... .... ....
.... .... .... .... ... .... ....
e. Abhijeet Group and Lokmat Group shall undertake to maintain their collective stake to the extent of at least at 51% and retain management control of SPV at all times."
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 62 of 405
141. He told that as is clear from the MOU, the preparation or finalization or submission of application for allocation of coal block to MoC was the job of Abhijeet Group and Lokmat Group and IDFC had no role to play in the same. However till the submission of application to MoC the IDFC was to appraise the project beside issuing a letter of intent to finance the project subject to various approvals and due diligence and the signing of MOU was the fundamental document executed between the parties. IDFC had accordingly issued a letter of intent/support. He had signed letter dated 09.01.2007, Ex. PW 1/C (colly) (available at page 9 of D-3) which was letter of intent/support issued on behalf of IDFC in the name of SPV i.e. JLD Yavatmal Energy Ltd.
142. The said letter was sent with attention to Sh. Devendra Darda, Director. The said letter of intent was issued after a decision in this regard was taken in the Decision Board Meeting of IDFC held on 09.01.2007. The minutes as are available at page 4 in D-16 is Ex. PW 6/D. Ld. DLA had objected to mode of proof. Objection is overruled.
143. Upon being asked as to whether as per the MOU Ex. PW 3/F, the IDFC was to be treated as a promoter or sponsor of the SPV, witness stated that as per the said MOU, IDFC could not have been treated either as a promoter or CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 63 of 405 sponsor of the SPV M/s JLD Yavatmal Energy Ltd.
144. He deposed about attending the meeting of the 35 th Screening Committee alongwith Sh. Vinayak Mavinkurve on behalf of IDFC.
145. He told his e-mail IDs as under:
1. [email protected]
2. [email protected]
146. Vide letter dated 03.10.2012 he had delivered printout of various e- mail communication as mentioned in the said letters to the IO. The letter is Ex. PW 6/E (D-15).
147. He told that after reaching the venue of Screening Committee meeting in Delhi, he and Sh. Vinayak pointed out the issues in the presentation as were mentioned in e-mail dated 21.06.2007 [Ex. PW 3/K-4] to Sh. Sanjay Dey and Sh. Devendra Darda and the same were carried out by Sh. Sanjay Dey and Sh. Devendra Darda was present at that time. The aforesaid changes were made in the soft copy of the presentation as the hard copies thereof were already prepared and available with them and thus no changes as suggested by us were made in the hard copies thereof. At the time of making presentation, the hard copies of the same were given to screening committee members and from the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 64 of 405 soft copy, the presentation was made. The changes which were made in the soft copy of the presentation at the meeting minute itself before the presentation was made were in the cover page wherein it was mentioned that "JLD Yavatmal Energy Ltd. SPV promoted by IDFC and Lokmat Group" and on our suggestion the word IDFC was removed. Thereafter, inside the presentation the name of IDFC as a co-promoter of JLD was again got removed in the clause mentioning the background of promoters and thus the details of IDFC in that regard were got removed. He deposed that under the title "Project Developer" the name of IDFC was again got removed as it was mentioned that JLD Yavatmal Energy Ltd. is a special purpose vehicle promoted, controlled and managed by Lokmat Group and IDFC. Further under the clause title "Financial Closure" it was got removed that IDFC had appraised the project and arranged syndication of debt of Rs.3753 Crores and it was replaced with the clause that IDFC has agreed to syndicate the debt.
148. He deposed that the aforesaid changes were got effected as the facts earlier mentioned in the presentation were not according to the MOU Ex.PW3/F dated 27.12.2006 executed between the parties and the letter of consent/support dated 09.01.2007 Ex.PW1/C (colly).
149. He told that on the next day i.e. on 22.06.2007 after returning to CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 65 of 405 office in Mumbai, he informed about development of 21.06.2007 to his senior management vide e-mail Ex. PW 3/K-5 dated 22.06.2007.
150. He also told that pursuance to the MOU Ex. PW 3/F no PDA or SHA was ever executed between the parties. No financial investment was ever made on behalf of IDFC for the said project. No one representing IDFC ever remained on the board of directors of M/s JLD Yavatmal Energy Ltd. In fact no shares of said SPV Company were ever issued in favour of IDFC or any of its officers.
151. In cross-examination on behalf of A-1 to A-4, an email dated 26.12.2006 sent by the witness was exhibited as Ex.PW6/DX-1. He denied that changes in the presentation were made on suggestion of IDFC as per meeting dt. 18.06.2007.
152. Regarding his mail dated 26.12.2006 Ex. PW 6/DX-1 where it had been stated by the witness on behalf of IDFC that they proposed to execute an MOU with Abhijeet and Lokmat Group next day to co-apply for the coal blocks in Maharashtra, Chhatisgarh and develop the proposed end use 1215 MW power project in Maharashtra, witness stated that the said mail is an internal mail of their company i.e. IDFC and the word "co-apply" seems to have been loosely CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 66 of 405 used. However, he admitted that in Clause 1.7 of MOU, Ex. PW 3/F, the word "co-apply" has been used.
153. He admitted that as per MOU, IDFC was also to take part in the management and business of the SPV but explained that these all conditions were subject to IDFC taking up equity holding in the SPV and the same were in the nature of Minority Protection Rights.
154. He admitted that as per MOU dated 27.12.2006 Ex.PW3/F IDFC was not only to participate in the consortium as a financial investor but was also to take part in the management and business of the SPV. He admitted that IDFC was also to support the coal application bid process in terms of the details mentioned in clause 3(a)(ii). He also admitted that IDFC was also having right to nominate directors on the board of the SPV and it was also having both affirmative and negative rights as were mentioned in detail in annexure-I and annexure-II to the MOU. However, he explained that all these rights would have come into operation if IDFC had taken equity holding in the SPV and SHA would have been signed.
155. He denied that IDFC was not serious qua the changes as were suggested by it in the presentation or that they were minor in nature. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 67 of 405
156. He was confronted with his statement u/s 161 Cr.PC Ex. PW6/DX- 2 regarding various portions of his examination-in-chief.
157. In cross-examination on behalf of A-5 to A-7 he was generally questioned on the MOU dt. 27.12.2006 (Ex. PW3/F).
158. PW-7 Sh. Vinayak Mavinkurve deposed that he was working as Head Client Coverage (Infrastructure and Conglomerate) IDFC Bank. In 2006- 07, he was working as Director, Business Development (Energy), IDFC Ltd. at Mumbai. While working in IDFC Ltd. he was reporting to Sh. M.K. Sinha, Executive Director of the Company. Mr. Aditya Aggarwal was part of his team and was working as Lead Specialist, Business Development, Energy. Alongwith me Sh. Sachin Johri was working as Executive Vice President, Project Equity.
159. Till about March 2007, Sh. Aditya Aggarwal used to report to him and thereafter he was shifted to Project Equity and he used to report to Sh. Sachin Johri.
160. He deposed that he was well acquainted with handwriting and signatures of above persons as he had seen them writing and signing.
161. IDFC was in the business of financing infrastructure projects in CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 68 of 405 India. He was aware about M/s JLD Yavatmal Energy Ltd. (M/s JLD) and its proposed power project to be established by it.
162. Abhijeet Group was an existing client of IDFC as one of their road project was financed by IDFC in the year 2004 or so. In November 2006, Sh. Abhishek Jayaswal approached IDFC on behalf of Abhijeet Group and Lokmat Group to join them as a financial investor in their proposed project of establishing a 1200 MW power plant in Yavatmal District in Maharashtra.
163. The said proposal was accordingly considered by them and was discussed in the Decision Board of IDFC. He had attended the said decision board meeting.
164. He has deposed on the same lines as PW-6.
165. He identified signature of Sh. Sachin Johari on seizure memo dt. 05.09.2012 and the same is Ex.PW7/A (D-12). He identified signatures of Sh. Ketan Kulkarni at point A on letter dated 27.09.2012 [available at page 6 in D- 16], address to CBI. The letter dated 27.09.2012 is Ex.PW7/B.
166. He deposed that IDFC was participating in the project as a prospective financial investor in the event of company getting allotment of a CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 69 of 405 coal block. IDFC was not a promoter of M/s. JLD and the SPV. M/s. JLD was neither being controlled nor being managed by IDFC and even such a role of control and management was not envisaged under the MOU for IDFC.
167. In cross-examination on behalf of A-5 to A-7 a statement under section 161 Cr.P.C. dated 28.09.2012 was exhibited as Ex.PW7/DX-1. He stated that he was satisfied with the presentation made by way of soft copy before the Screening Committee as the changes suggested by them were carried out in the same.
168. He also told that the hard copy of the presentation could not be corrected due to paucity of time.
169. In cross-examination on behalf of A-1 to A-4, he was questioned on the same lines as PW-6.
170. He was confronted with his statement u/s 161 Cr.PC [Ex. PW 7/DX-1] regarding various portions of this examination-in-chief. FROM MINISTRY OF COAL
171. PW-5 Sh. A. Sanjay Sahay was posted as Under Secretary, Ministry of Coal, Govt. of India in 2013 and was looking after the work of CA- CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 70 of 405 I, Section.
172. He identified his signature on letter dated 28.01.2013 [as available in D-35] and deposed that vide the said letter he had sent a file bearing no. 38039/31/2007-CA-1 of MoC containing 8 note sheet pages and 107 correspondence side pages pertaining to recommendation letters of Sh. Vijay Darda, MP in respect of various companies as was available in MoC to Sh. Nirbhay Kumar, SP CBI. The letter is Ex. PW-5/A (D-35). He also identified the file bearing no. 38039/31/2007-CA-1 of MoC and the same is Ex. PW-5/B (colly) (D-36).
173. In cross-examination, he told that file Ex. PW-5/B (colly) was never dealt with by him as the note sheet pages or other pages on the correspondence side pertain to the period before he joined MoC. He thus could not comment anything about the contents of the said pages in the file. He did not remember whether IO prepared any seizure memo qua the said file or issued any receipt of acknowledgment or not.
174. PW-14 Sh. V.S. Rana was posted from August 2005 till December 2013 in MoC as Under Secretary. He is one of the main witness for the prosecution. He deposed in detail about the process of allocation of the coal CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 71 of 405 blocks in general and of Fatehpur East coal block in particular.
175. From September 2005 till November 2011, he was posted as Under Secretary, CA-1, Section. Thereafter he was transferred to CPAM Section, MoC. From September 2005 till August 2007, he was having main charge of Vigilance Section but the charge of CA-1 Section was given as additional charge to him.
176. PW-14 told that during the period 2006-08, CA-1 Section, MoC was dealing with matters of allocation of captive coal blocks to private parties.
177. He deposed that initially the coal blocks which could be allocated for captive allocation were identified by Coal India Ltd. ("CIL") on request of MoC. Thereafter, with the consultation of CMPDIL, CIL and Administrative Ministries, various coal blocks were earmarked by MoC for allocation to power sector and to non-power sector which could be allotted by Govt. company dispensation route or which could be allotted by way of captive dispensation route through Screening Committee or tariff based competitive bidding.
178. He deposed that MoC issued an advertisement inviting applications for allocation of 38 coal blocks for captive use. The said advertisement was issued in November, 2006. Thereafter, upon receipt of applications, they were segregated block-wise, state-wise, end use-wise and they were sent to concerned CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 72 of 405 state Govts. and administrative ministries and to CMPDIL for their comments/views.
179. Subsequently after receipt of comments/views of some of the entities as above, and on the oral directions of senior officers, file was moved for fixing date for holding Screening Committee meeting and after the date was decided by the senior officers then intimation of the same was sent to the applicant companies to make their presentation before the Screening Committee. Intimation in this regard was also sent to the members of Screening Committee.
180. He further deposed that subsequently when Screening Committee made its recommendation for allocation of various coal blocks to different applicant companies for their captive use, then the said recommendations were processed in MoC and were sent to competent authorities for obtaining the final approval. After final approval was accorded in whichever cases by the competent authorities, the allocation letters/option letters were issued or other directions as were given by competent authority were followed by MoC.
181. He told that during the period 2006-2008 Sh. Shibu Soren was initially the Minister of Coal and, thereafter, the Prime Minister Dr. Manmohan CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 73 of 405 Singh himself was holding the charge of Minister of Coal.
182. During this period Sh. H.C. Gupta was Secy. (Coal) and Sh. K.S. Kropha was Jt. Secy. (Coal). Sh. Sanjiv Mittal was Director, CA-1, probably till March/April 2006 and, thereafter, for some period the charge of Director, CA-1 remained as additional charge with some Mr. Aggarwal. Thereafter Sh. K.C. Samria took over as Director, CA-1. Sh. Samria was initially Deputy Secretary, MoC and subsequently he was promoted as Director. PW-14 identified Sh. H.C. Gupta, Sh. K.S. Kropha and Sh. K.C. Samria in the Court.
183. PW-14 claimed that he was well acquainted with the handwriting and signatures of Sh. H.C. Gupta, Sh. K.S. Kropha, Sh. K.C. Samria, Sh. Sanjiv Mittal, Dr. Manmohan Singh and Sh. Shibu Soren as while working in MoC, he had seen them writing and signing or had seen documents carrying their signatures and handwriting and thus could identify the same, if shown to him.
184. He further told that Sh. Prem Raj Kuar followed by Sh. R.N. Singh and thereafter Sh. L.S. Janoti were the Section Officer, CA-1 Section during the period 2006-08. Sh. R.S. Negi was the dealing Assistant with respect to the matters related to captive coal blocks allocation to private companies. He again claimed that he was well acquainted with the handwriting and signatures of Sh. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 74 of 405 Prem Raj Kuar, Sh. R.N. Singh, Sh. L.S. Janoti and Sh. R.S. Negi for the same reasons.
185. PW-14 explained the process in detail. He told that the applicant companies who were to apply for seeking allocation of captive coal blocks were required to submit their applications in five copies. He told that in the advertisement (as was approved in the file) all the detailed guidelines specifying as to where to apply, how to apply etc. were mentioned.
186. He deposed that he had dealt with MoC file bearing No. 13016/65/2006-CA-1, (Vol. I) (as is available in D-30) and pointed out various note sheet pages bearing his signatures.
187. The copy of file as is available in D-30 is Ex. PW 14/A (Colly). The note sheet pages as are available from page 1-49 are collectively Ex. PW 14/A-1 (Colly) and the correspondence side pages as are available from pages 1-233 are collectively Ex. PW 14/A-2 (Colly).
188. From the documents, he told that the applications were to be submitted in the CIL's office at Scope Minar, Laxmi Nagar, Delhi and the last date of receiving the applications was stated as 12.01.2007. Further details such as application format, documents to be enclosed, details regarding the coal CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 75 of 405 blocks on offer and other guidelines etc. were stated to be available on MoC website i.e. www.coal.nic.in.
189. He pointed out that at page 84, the guidelines titled "Where to apply" were available wherein besides mentioning the aforesaid address of CIL office where the applications were to be submitted and the last date of receipt of applications, it was also stated that application in five copies was to be addressed to Sh. Sanjiv Mittal, Director, CA-1, MoC. The advertisement which was got published in the newspapers and as is available on page 74 was issued under the signatures of Sh. K.S. Kropha, Jt. Secretary, MoC.
190. He told that as per the advertisement so issued, the companies registered under the Indian Companies Act, 1956 and which were engaged in generation of power, production of iron and steel and production of cement, could apply for one or more of the blocks on offer.
191. The advertisement alongwith guidelines as is available from page 73-94 are collectively Ex. PW 14/B-1 (Colly).
192. The advertisement was sent to Director, DAVP for getting it published in Prominent Dailies and the same was sent by him vide his letter dated 06.11.2006. The office copy of the said letter available at page 69 of the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 76 of 405 file is Ex. PW 14/B-2. He sent another letter dated 06.11.2006 to Technical Director, NIC, MoC for uploading on the website of MoC. The office copy of the said letter as is available at page 71 is Ex. PW 14/B-3.
193. He had also sent another letter to CGM, CIL requesting to ensure that the advertisement so issued by MoC was got published through DAVP at the earliest so as to give wide publicity to the process. The office copy of the letter as is available at page 70 is Ex. PW 14/B-4.
194. PW-14 further deposed that Secy. (Coal), Sh. H.C. Gupta was the Chairman of Screening Committee and Sh. K.S. Kropha, Jt. Secy. (Coal) was the Member Convener of Screening Committee. The applications so invited were dealt with by 35th and 36th Screening Committee. The 35th Screening Committee dealt with applications received for allocation of coal blocks reserved for power sector.
195. Prior to the issuance of the aforesaid advertisement, the same was approved on note sheet pages 3-5 in note sheet pages Ex. PW 14/A-1 (Colly) in file Ex. PW 14/A (Colly) (D-30).
196. He deposed that initially Sh. R.N. Singh, Section Officer, CA-1, vide his note dated 04.11.2006 had put up a detailed note running from page 3-4 CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 77 of 405 and the same was thereafter further processed by Jt. Secy. (Coal) Sh. K.S. Kropha vide his handwritten note dated 04.11.2006 and thereafter the same was approved by Sh. H.C. Gupta, Secy. (Coal) vide his signatures dated 04.11.2006. Thereafter the file moved downwards and thus the advertisement was issued. The note dated 04.11.2006 was initiated by Sh. R.N. Singh, Section Officer as in the meeting of Principal Secretary to PM held on 14.09.2006, it was decided that Secy. (Coal) would identify, in consultation with Secy. (Power), the coal blocks to be earmarked for power sector out of the total 81 blocks.
197. He deposed that vide an I.D. note dated 25.07.2006 of PMO, the summary record of 7th Energy Co-ordination Committee meeting held on 19.07.2006 were received in MoC from PMO. The I.D. note is Ex. PW 14/B-5 (Colly). The draft advertisement is available from page 1-29 on correspondence side containing corrections/additions at page 2, page 7 and page 14 in the hand of Sh. K.S. Kropha and is Ex. PW 14/B-6 (Colly).
198. As per the guidelines issued by MoC under the title "How to apply", the following documents were required to be annexed:
(i). Certificate of registration showing that the applicant is a company registered under S. 3 of the Indian Companies Act.
This document should be duly signed and stamped by the Company Secretary of the Company. (1 Copy).
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 78 of 405
(ii). Document showing the person/s who has/have been authorized to sign on behalf of the applicant company while dealing with any or all matters connected with allocation of the sought coal block/s for captive mining with the Govt./its agencies. This document should be duly signed and stamped by the Company Secretary of the Company. (5 Copies.)
(iii). Certified copy of the Memorandum and Articles of Association of the applicant Company. (5 Copies).
(iv). Audited Annual Accounts/reports of last 3 years. (5 Copies).
(v). Project report in respect of the end use plant. If the project report is appraised by a lender, the appraisal report shall also be submitted. (5 Copies).
(vi). Detailed Scheduled of implementation for the proposed end use project and the proposed coal mining development project including Exploration programme (in respect of regionally explored blocks) in the form of Bar Charts. (5 Copies).
(vii). Scheme for disposal of unuseables containing carbon obtained during mining of coal or at any stage thereafter including washing. This scheme must include the disposal/use to which the middlings, tailings, rejects etc. from the washery are proposed to be put. (5 Copies).
(viii). The above details are required to be submitted in respect of all the concerned companies in case of SPV/JV or Mining company.
(ix). Demand draft for Rs.10,000/- in favour of PAO, Ministry of Coal payable at New Delhi.
199. He deposed that it was also specified in the said guidelines that the applications without the aforesaid documents would be treated as incomplete and shall be rejected.
200. In the advertisement so issued, it was also stated that preference CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 79 of 405 would be accorded to the power sector and steel sector. It was further stated that within the power sector, priority shall be accorded to projects with more than 500 MW capacity. Similarly in the steel sector, it was stated that priority shall be given to steel plants with more than one million ton per annum capacity. The same facts regarding preference to be accorded were also mentioned in detailed guidelines as were uploaded on the website of MoC.
201. As regard inter se priority to be decided for allocation of a block among competing applicants for a captive block, the following factors were mentioned in the guidelines:
Status (stage) level of progress and state of preparedness of the projects;
Networth of the applicant company (or in the case of a new SP/JV, the networth of their principals);
Production capacity as proposed in the application; Maximum recoverable reserve as proposed in the application; Date of commissioning of captive mine as proposed in the application;
Date of completion of detailed exploration (in respect of unexplored blocks only) as proposed in the application; Technical experience (in terms of existing capacities in coal/lignite mining and specified end use);
Recommendation of the Administrative Ministry concerned; Recommendation of the State Govt. concerned (i.e. where the captive block is located);
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 80 of 405 Track record and financial strength of the company.
202. The composition of the Screening Committee was stated in the advertisement as under (available at page 94):
Composition of the Screening Committee 1 Secretary, Ministry of Coal Chairman 2 Joint Secretary (Coal), Ministry of Coal Member-
Convener 3 Adviser (Projects), Ministry of Coal Member 4 Joint Secretary (LA), Ministry of Coal Member 5 Representative of Ministry of Railways, Member New Delhi 6 Representative of Ministry of Power, New Member Delhi 7 Representative of Concerned State Govt. Member 8 Director (Technical), CIL, Kolkata Member 9 Chairman-cum-Managing Director, Member CMPDIL, Ranchi 10 CMD of concerned subsidiary company of Member CIL/NLC 11 Representatives of Ministry of Steel Member 12 Representatives of Department of Industrial Member Policy & Promotion (Ministry of Industry) 13 Representative of Ministry of Environment Member and Forest
203. Upon being asked as to how the applications were received, the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 81 of 405 witness stated that initially a meeting was held in the office of Jt. Secy. (Coal) so as to discuss and decide as to how the applications would be received and processed. In the said meeting, the Director, CA-1 Sh. Sanjiv Mittal and Section Officer were present besides him. Accordingly, Sh. R.S. Negi, Dealing Assistant, CA-1 Section and a Peon were deputed at Scope Minar for receiving applications in the initial days. However, when the number of applications being received increased then on the last date 4-5 counters were established at Scope Minar Laxmi Nagar for receiving applications. Accordingly, on that day other officials of the section were also deputed there. Some officials of the office of the Coal Controller were also called but he did not remember as to whether they had reached by the last date of receipt of applications or not. Initially, a register in this regard was being maintained for making entries of the applications being so received. However, on the last date every counter was making entries in a separate register maintained at their own counter. Thus, beside the initial register, there were other registers also in which entries of the applications being received were made.
204. Subsequently upon receipt of all applications the entries of all the registers which were maintained on different counters as above were transferred to the main register which was being maintained from the initial days. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 82 of 405
205. The register is Ex. PW 11/A (available in D-5). He identified it to be the same main register in which entries of all applications so received were made. He identified his signatures dated 12.01.2007 and that of Sh. R.S. Negi and Sh. R.N. Singh on the register. Witness further pointed out that five applications of M/s JLD Yavatmal Energy Ltd. were received vide entries numbers 235-239 at page 30 of the register for different coal blocks i.e. Durgapur-II Taramiar, Fatehpur, Lohara West and Extension, Durgapur-II Sariya and Fatehpur East.
206. He deposed that he had dealt with the applications of M/s JLD Yavatmal Energy Ltd. at the time of preparation of agenda at the time of Screening Committee meeting. Witness however further stated that he had not dealt with the applications case-wise.
207. The application of JLD is Ex. PW 1/A (covering letter), Ex. PW 1/B (application form) and Ex. PW 1/C (Colly) (the various annexures to the application).
208. Upon being asked as to what action was taken after receipt of applications, the witness stated that the applications were thereafter segregated block-wise, end use-wise and state-wise. Thereafter one copy of each of the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 83 of 405 application was forwarded to concerned state Govt. where the coal block in question was located and the proposed end use plant was to established, if the said state was different from the one where the coal block was situated. One set of the applications was sent to MoP as the said applications pertained to coal blocks reserved for power sector. One set of the applications were also sent to CMPDIL.
209. He deposed that vide office copy of a letter dated 20.12.2006 Ex. PW 10/DX-2 (available at page 102 in D-30) issued under his signatures, the Coal Controller, Kolkata was requested to depute four officials, initially for 20 days or further period as per requirement for the purpose of receiving applications etc.
210. He deposed that vide office copy of a letter dated 19/28-02-2007 (available at page 167 in file Ex. PW 14/A (Colly) (D-30) issued under his signatures, one copy of concerned applications were sent to Chief Secretary, Govt. of Maharashtra for their examination and comments thereon to be furnished to MoC by 31.03.2007. The letter as above is Ex. PW 14/B-7.
211. He deposed that vide office copy of a letter dated 19/28-02-2007 (available at page 199 in file Ex. PW 14/A (Colly) (D-30) issued under his CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 84 of 405 signatures, one copy of all the applications were sent to Chairman-cum- Managing Director, CMPDIL for their examination and comments thereon to be furnished to MoC by 31.03.2007. The letter as above is Ex. PW 14/B-8.
212. Witness further stated that the letter dated 20.12.2006, Ex PW 10/DX-2, was sent by him pursuant to decision taken by the competent authority during the finalization of course of action for receiving applications. Witness further pointed out that in note dated 04.11.2006 of Sh. R. N. Singh, it was stated by him that as large number of applications are expected to be received, so it would not be possible to receive them in the Ministry and thus CIL is being requested to make space in Scope Minar, Laxmi Nagar to receive applications by a team of CMPDIL under supervision of the Ministry and the said note was finally approved by Secy. (Coal).
213. As regards sending of copy of application to State Govt. of Maharashtra vide letter Ex PW 14/B-7 and to CMPDIL vide letter Ex PW 14/B- 8, the witness pointed out note dated 12.02.2007 of a dealing assistant and as forwarded by Sh. R. N. Singh vide his signatures dated 12.02.2007 at point A, witness stated that in the said note it was stated that applications are required to be dispatched to concerned States/Ministries. It was also stated in the note that big size trunks - 130 Numbers and transportation arrangement are required to CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 85 of 405 be made by CIL. One DFA in this regard was also put up. The said note with the signature of Sh. R. N. Singh was put up before him and he forwarded to Sh. Aggarwal, who was looking after the work of Director (CA-I) as link officer since Director (CA-1) was away on election duty. He had forwarded the file with the endorsement "May kindly approve the proposal and draft letter" vide his signatures dated 12.02.07 at point B.
214. The link Director thereafter forwarded the file to Jt. Secy. (Coal) with the endorsement "May kindly see before issue". The file was thereafter put up before Jt. Secy. (Coal), Sh. K. S. Kropha who thereafter put his signatures dated 12.02.07 at point C on the note sheet page and the file thereafter was marked downward to link Director and who further marked it below and he vide his signatures dated 13.02.07 at point D further forwarded it down in the Section.
215. The witness further pointed out that thereafter vide endorsement dated 19.02.07, a note was put up by the dealing assistant and which was further forwarded to him by Sh. R. N. Singh vide his signatures dated 19.02.07 at note sheet page 10. The said note dated 19.02.07 read as under:
"Applications received for allocation of 39 coal blocks in response to advertisement published through newspaper, are ready to dispatch to CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 86 of 405 CMPDIL, different state Govts. and administrative Ministries namely M/Power, M/ Steel and M/Industry & Commerce, Deptt. Of Industrial Policy & Promotion.
Accordingly, draft letter are placed below for approval. DFA."
216. The said note was put up before him and he put his signatures dated 19.02.07 on the note sheet page at point B. The witness further pointed out that the endorsement "Issue to only those States for which applications are ready" as has been encircled in red at point C on the note sheet page 10 is in the hand of Sh. R. N. Singh.
217. Vide letter dated 17.04.07 [available at page 2 in MoC file available in D-52], copy of the applications so received alongwith list were sent to Secretary, MoP. The letter dated 17.04.07 along with the list of applicant companies as is available from page 4 to 75 is collectively exhibited as Ex PW 14/C (Colly) (D-52). Witness further pointed that from page 73 to 75, the name of those applicant companies are mentioned who had applied for other coal blocks but also wanted to establish captive power plants. The originals were seen from case file of another case.
218. The applications of M/s JLD Yavatmal Energy Limited are at Sl. 235 to 239 to the said list of applications so sent to Ministry of Power.
219. He deposed that vide letter dated 11.04.07 [as is available at page CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 87 of 405 76 in D-52] issued under the signatures of Sh. R. N. Singh, the application forms (block-wise) and CDs received from the applicants who had applied for allocation of coal blocks in power sector were sent to Sh. A. K. Wahi, General Manager, CMPDIL for preparation of data base. The letter dated 11.04.07 is Ex PW 14/C-1 (There was objection from Ld. Counsel of A-1 as to mode of proof. The objection is overruled since witness was well acquainted with the signatures of Sh. R.N. Singh.)
220. Witness stated that letter dated 17.04.07 vide which one set of each application was sent to MoP was issued pursuant to approval granted in this regard by Director (CA-1) Sh. K. C. Samria. Witness pointed out note sheet page 18 in note sheet pages Ex PW 14/A-1 (Colly) in file Ex PW 14/A (Colly) (D-30) stating that a note dated 17.04.07 in this regard was put up by the dealing assistant and the same was forwarded by Sh. R. N. Singh to him vide his signatures dated 17.04.07. Witness further stated that the said note was forwarded by him vide his signatures dated 17.04.07 to Dy. Secretary (CA-1) and after Sh. K. C. Samria approved it vide his signatures dated 17.04.07 and thereafter the file moved downward and witness further stated that he thereafter vide his signatures dated 18.04.07 he further marked the file downward in the Section.
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221. As regard processing of applications, he deposed that the following guidelines were mentioned in the advertisement Ex PW 14/B-1 (Colly):
"PROCESSING OF APPLICATION The applications received in the Ministry of Coal in five copies, after being checked for eligibility and completeness, would be sent to the administrative Ministry/State Govt. concerned for their evaluation and recommendations. After receipt of recommendations of the administrative Ministry/State Govt. concerned, the Screening Committee would consider the applications and make its recommendations. Based on the recommendations of the Screening Committee, Ministry of Coal will determine the allotment."
222. Upon being asked as to in what manner the aforesaid guidelines titled "Processing of application" were followed in MoC, the witness stated that the applications before being sent to Administrative Ministry/ State Govt. concerned for their evaluation and recommendations were not checked for eligibility and completeness. Witness however further stated that the aforesaid fact that the applications have not been checked for their eligibility and completeness was duly informed to Jt. Secy. (Coal) Sh. K. S. Kropha and also that the applications have only been segregated. Witness also stated that Sh. K. S. Kropha himself had once gone to Scope Minar, Laxmi Nagar where work of segregation was going on and he himself had also gone to Scope Minar, Laxmi Nagar on two-three occasions. Witness further stated that as in CA-I Section they were not having sufficient manpower to carry out checking of applications CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 89 of 405 for their eligibility and completeness and that they were also not having any technical or legal or financial knowledge to carry out any such exercise, so no checking of applications for eligibility and completeness was carried out.
223. He deposed that vide note dated 07.05.07 put up by dealing assistant [at note sheet page 20 in file D-30], the dealing assistant had put up the file vide as directed by Dy. Secretary (CA-1) over intercom that a meeting of the Screening Committee had been proposed to be held under the chairmanship of Secy. (Coal) on 11.05.07 at 10:30 AM in his chamber. Vide office memorandum dated 07.05.07 [available at page 87-88 in D-52] issued under his signatures, notice of the meeting of Screening Committee to be held on 11.05.07 was sent to Secretary, Ministry of Power/Steel/DIPP/CIL/CMPDIL/Coal Controller and to Dy. Secretary, CA-1 beside PS to senior officers of MoC. The office memorandum is Ex PW 14/C-2.
224. After seeing note sheet page 23 in D-30, witness stated that vide note dated 18.05.07 Sh. R. N. Singh had put up the draft minutes of the meetings held on 11.05.07 for approval. The said note was forwarded by him/PW-14 to Dy. Secretary, CA-1. Sh. K. C. Samria, Dy. Secretary vide his signatures dated 18.05.07 forwarded the same to Jt. Secy. (Coal) and who further forwarded the same to Secy. (Coal) vide his endorsement and signatures CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 90 of 405 dated 30.05.07. Thereafter Secy. (Coal) Sh. H. C. Gupta vide his signatures dated 31.05.07 approved the same and the file moved downward and after being routed through the desk of Jt. Secy. (Coal), Dy. Secretary CA-1, it came to his desk and he further marked it down in the Section. Witness further stated that as the said proceedings were being conducted in a part file so Sh. R.N. Singh vide his endorsement and signatures dated 04.06.2007 at point G marked it to Sh. R.S. Negi while observing that the part file be merged with the main file.
225. PW-14 identified draft minutes of meeting held on 11.05.07 as is available from page 105 to 106 in D-52 to be the same draft minutes which were put up by Sh. R. N. Singh vide his note dated 18.05.07. Witness stated that in the said draft minutes the corrections in black ink on both the pages are in his own hand and the corrections in blue ink on page 1 are in the hand of Jt. Secy. (Coal) Sh. K. S. Kropha and a correction in blue ink on page 2 is in the hand of Dy. Secretary, CA-1 Sh. K. C. Samria. The draft minutes as above are exhibited as Ex PW 14/C-3 (available from page 105 to 106 in D-52).
226. At this stage, witness pointed out the final approved Minutes of Meeting of the Screening Committee held on 11.05.07 as being available from pages 102 to 104 in D-52 and pointed out that at page 104 the list of participants who attended the said Screening Committee meeting is available. The minutes CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 91 of 405 as are collectively exhibited as Ex PW 14/C-4 (Colly).
227. He deposed that the minutes of Screening Committee meeting held on 11.05.07 were though prepared by CA-1 Section but were prepared on the directions and guidance of Director CA-1 and Joint Secy. (Coal) who had attended the said Screening Committee meeting.
228. He referred to a letter dated 21.05.2007 Ex. PW 13/B [as is available at page 34 in D-24] and stated that a copy of the said letter addressed to Secretary Industries, Govt. of Maharashtra, Mumbai and issued under the signatures of Principal Secretary, Energy, Govt. of Maharashtra was also received in MoC as a copy thereof was marked to Secretary, MoC, Govt. of India. Witness identified signatures of Sh. H.C. Gupta dated 05.06.2007 at point A, Sh. K.S. Kropha at point B and Sh. K.C. Samria at point C and that of Sh. R.N. Singh at point D on the said letter. Vide the said letter Secretary, Industries, Govt. of Maharashtra was requested by Principal Secretary, Energy that as the request of the company for allotment of one coal block in order of preference from out of 8 coal blocks as were mentioned in the letter was being recommended so it was requested to forward the proposal of M/s JLD Yavatmal Energy Ltd. to MoC, Govt. of India for allotment of coal block. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 92 of 405
229. He also referred to another letter dated 23.05.2007 Ex. PW 13/A [available at page 35 in D-24], and stated that vide the said letter issued under the signatures of Sh. V.K. Jairath, Principal Secretary, Industries, Govt. of Maharashtra, the recommendation of State Govt. of Maharashtra in favour of M/s JLD Yavatmal Energy Ltd. for allotment of coal blocks mentioned in the letter was sent to Secretary, MoC, Govt. of India. In the letter it was mentioned that the state Govt. had issued a letter of support to M/s JLD Yavatmal Energy Ltd. for their project. The said letter bears signatures of H.C. Gupta dated 05.06.2007 at point A and that of Sh. K.S. Kropha and Sh. K.C. Samria at points B and C respectively. Witness has also identified signatures of Sh. R.N. Singh dated 07.06.2007 at point D.
230. He further referred to letter dated 15.06.2007 Ex. PW 13/DX-1 and stated that vide the said letter addressed to Secretary, MoC, Govt. of India, Sh. V.K. Jairath, Principal Secretary Industries, Govt. of Maharashtra had in response to letter No. 13016/65/2006-CA-1 dated 28.02.2007 of MoC had made its recommendation in favour of various companies qua the coal blocks situated in State of Maharashtra. The said letter Ex. PW 13/DX-1 carries signatures of Sh. H.C. Gupta dated 19.06.2007 at point A and that of Sh. K.S. Kropha and Sh. K.C. Samria at point B and C respectively. Witness has identified his own CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 93 of 405 signatures at point D and that of R.N. Singh at point E of the letter.
231. Witness further stated that while being posted in MoC he had dealt with file bearing No. 38011/1/2007-CA-1 (Vol.I). The file is collectively exhibited as Ex. PW 14/D (Colly) (D-24). Witness further stated that while being posted in MoC he had dealt with file bearing No. 38011/1/2007-CA-1 (Vol.II). The file is collectively exhibited as Ex. PW 14/E (Colly) (D-23). Letter dated 20.06.2007 [available at page 136-137, in file Ex. PW 14/E (Colly) (D-23)] was sent by Sh. Anil Razdan Secretary Power to Sh. H.C. Gupta, Secretary, MoC, and it was informed that Ministry of Power had so far not made any case by case examination of the applications and had also not made any recommendations to the MoC. While referring to his earlier communication he stated that the views of the Ministry of Power would be communicated by the Ministries representatives at the Screening Committee. The said letter bears signatures of Sh. H.C. Gupta dated 22.06.2007 and that of Sh. K.C. Samria. Witness also identified his own signatures at point C and stated that the same was marked to Section Officer, CA-1 by him. The letter dated 20.06.2007 as above is Ex. PW 14/E-1.
232. The 35th Screening Committee initially met from 20th to 23rd June, 2007 and thereafter, it again met on 30.07.2007 and finally on 13.09.2007. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 94 of 405
233. The initial meetings from 20th to 23rd June, 2007 were held at Scope Minar, Laxmi Nagar and the subsequent two meetings were held at MoC Office, Shashtri Bhawan.
234. Witness further stated that while being posted in MoC he had dealt with file bearing No. 38011/1/2007-CA-1 (Vol.VI). The file is collectively exhibited as Ex. PW 14/F (Colly) (D-27).
235. He told that the members of Screening Committee were informed about the meeting schedule by way of office memorandum Ex. PW 14/D-1. The applicant companies were informed vide letter Ex. PW 14/D-2. Office memorandum dated 06.06.2007 [available at page 36] vide which Sh. Piyush Goel Technical Director NIC (coal) was requested to put up on the website of MoC a notice containing information of schedule of meeting of 35 th Screening Committee, letters to members of Screening Committee and to applicants for power blocks beside also putting up feed back format as was enclosed with the office memorandum is Ex. PW 14/D-3 (Colly).
236. The agenda note for the Screening Committee meeting was prepared after compiling the application only of various applicant companies as was submitted by them in the prescribed application format. Copies of agenda CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 95 of 405 note was prepared for all members of the Screening Committee. The agenda for 35th Screening Committee meeting for power sector to be held from 20.06.2007 to 23.06.2007 for Fatehpur East Coal Block is available in D-34.
237. He proved the request letter dated 31.05.2007 [available at page 31 in file Ex. PW 14/D (Colly)] vide which a request was made to Coal Controller, Kolkata to depute three officials from his organization to MoC for initially three weeks. The same is Ex. PW 14/D-4.
238. He deposed that at the meeting held from 20 th to 23rd June, 2007 the representatives of various applicant companies appeared before the Screening Committee. The representatives used to give one copy of the feedback form to the MoC officials outside the meeting hall and also used to sign the attendance sheet. After entering inside the meeting hall, the representatives used to give their presentation either by way of hard copy or soft copy or even both and also used to supply copies of the presentation and feedback form to the members of the Screening Committee. The members of Screening Committee used to sign on attendance sheet inside the meeting hall itself. The attendance sheet is Ex. PW 14/E-2 (Colly) (D-23) [attendance sheet dated 21.06.2007 Ex. PW 3/H is thus part of attendance sheet Ex. PW 14/E-2 (Colly)]. The attendance sheets of members of Screening Committee is Ex. PW 14/E-3 (Colly). (There was CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 96 of 405 objection to the mode of proof but is overruled as witness was appointed with signatures of various officials.)
239. He told that the aforesaid Screening Committee meetings were chaired by Sh. H.C. Gupta Secy. (Coal). The office memorandum regarding next date of meeting on 30.07.2007 of the Screening Committee is Ex. PW 14/E-4. In the said meeting no final decision was arrived at by the Screening Committee.
240. The attendance sheet of members of Screening Committee who attended the meeting held on 30.07.2007 [available from page 148-149 in D-23] is Ex. PW 14/E-5.
241. Upon being asked as to what role he played in the said meeting the witness stated that he does not remember properly as to whether he was present on the said day or not. Witness further volunteered that even if he would have been present then like every Screening Committee meeting he remains inside or outside the meeting hall.
242. The DO letter dated 30.07.2007 [available at page 215-218 in D- 23] vide which Sh. Anil Razdan, Secretary Power had sent recommendation of Ministry of Power in favour of some of the companies as per the list enclosed to CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 97 of 405 Sh. H.C. Gupta Secy. (Coal) is Ex. PW 14/E-6 (Colly) (D-23). In the enclosed list of MoP the name of M/s JLD Yavatmal Energy Ltd was recommended for joint allocation of Fatehpur East coal block along with three other companies.
243. He told that vide note sheet page 11 in file Ex. PW 14/F (Colly) (D-
27) pursuant to decision of Screening Committee taken in the meeting held on 30.07.2007, the applications were to be verified in terms of financial details, status of preparedness of end use and thus it was stated by Sh. R.N. Singh that as discussed services of financial experts of CIL and manpower support of the office of Coal Controller may be availed.
244. The note was approved. The letter dated 02.08.2007 Ex. PW 12/DX-1, [available at page 151 in file Ex. PW 14/E (Colly) (D-23)] was sent to Chairman, Coal India Ltd. (CIL) in this regard.
245. He also proved office copy of letter dated 02.08.2007 [available at page 155 in file Ex. PW 14/E (Colly) (D-23)] vide which a request was made to Coal Controller, Kolkata to depute four officials for scrutinizing applications for coal blocks earmarked for allocation through the Screening Committee. The letter was sent by fax. The letter dated 02.07.2008 as above is Ex. PW 14/E-7.
246. He also referred to office copy of letter dated 02.08.2007 Ex. PW CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 98 of 405 13/DX-2, [available at page 164 in file Ex. PW 14/E (Colly) (D-23)] and told that vide the said letter Chief Secretary, Govt. of Maharashtra was requested to verify the status of preparedness of applicant companies whose names were mentioned in the enclosed list in terms of the following:
"(i) Land already acquired by the company (in possession) (Column No. VIII under head 'Land' of the enclosed sheet ).
(ii) Quantity of water already allotted by State Govt. ( Column No. X under head 'water' of the enclosed sheet).
(iii) Status of Civil Construction ( in terms of percentage) (Column No. XI)
(iv) Status of environment clearance in respect of end use plant. (Column No. XII)."
247. He told that vide office copy of letter dated 10.08.2007 Ex. PW 13/DX-3, [available at page 207 in file Ex. PW 14/E (Colly) (D-23)] a reminder was sent to Chief Secretary, Govt. of Maharashtra for obtaining their reply to earlier letter dated 02.08.2007 Ex. PW 13/DX-2.
248. He told that as per note sheet page 12-13 in note sheet pages Ex. PW 14/F (Colly) (D-27) all the aforesaid letters were sent under the signatures of Sh. K.C. Samria.
249. He proved file of MoC bearing No. 38011/1/07-CA-I (VII) as is available in D-28, as he had dealt with the said file. The file is Ex. PW 14/G CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 99 of 405 (Colly) (D-28).
250. He told that vide letter dated 14.08.2007 Ex. PW 13/DX-4 (Colly) [available at page 56-58 in file Ex. PW 14/G (Colly) (D-28)], Govt. of Maharashtra in response to letter dated 02.08.2007 of MoC had sent the requisite information regarding status of preparedness for end use plant by the applicant companies qua 10 applicants and it was further stated that information about the remaining 15 applicant companies would be sent as soon as the same was received by them from the applicant companies. It was addressed to Sh. K.C. Samria and was seen by him.
251. He told that vide letter dated 17.08.2007 Ex. PW 13/DX-5 (Colly) [available at page 9-11 in file Ex. PW 14/G (Colly) (D-28)], Govt. of Maharashtra sent further requisite information regarding status of preparedness for end use plant by the applicant companies qua another 8 applicant companies including JLD from out of the remaining 15 applicants. It was also addressed to Sh. K.C. Samria and was seen by him. Vide the said letter information about status of preparedness qua M/s JLD Yavatmal Energy Ltd. was furnished.
252. He proved note on note sheet page 13 in file Ex. PW 14/F (Colly) (D-27), and dated 06.09.2007 vide which draft notice to be issued to the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 100 of 405 members of the Screening Committee for the Screening Committee meeting scheduled to be held on 13.09.2007 were put up for approval. It was approved upto accused H.C. Gupta, Secy. (Coal). Fair draft letter was also put up.
253. He further proved MoC file bearing No. 38011/1/2007-CA-I (Vol. III) as is available in D-25, as he had dealt with the same while being posted in MoC. The file is exhibited as Ex. PW 14/H (Colly) (D-25).
254. Copy of office memorandum dated 6/8-9-2007 [as is available from page 47] vide which notice of Screening Committee meeting to be held on 13.09.2007 at 2.30 PM in Shashtri Bhawan, MoC office was sent to all the members of the Screening Committee under his signatures at point A and B is Ex. PW 14/H-1.
255. He told that after the recommendations of Screening Committee meeting were arrived at then recommendation sheets were prepared in the meeting itself and confirmation was taken and the members who had attended the meeting signed on the same.
256. He told that subsequently the minutes of 35 th Screening Committee meeting were prepared. The said minutes were prepared on the directions and guidance of Joint Secy. (Coal) Sh. K.S. Kropha and Director, CA-I Sh. K.C. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 101 of 405 Samria. The minutes were prepared by CA-I Section. Some inputs in the minutes were even given by Director/Joint Secretary.
257. He told that vide detailed note dated 14.09.2007 as is available on note sheet pages 15-20 in file Ex. PW 14/F (Colly) (D-27), the file was submitted to MOS (Coal) for orders/approval. Thereafter the Minister for State for Coal Sh. Dasari Narayan Rao vide his signatures dated 16.09.2007 at point E forwarded the file to Prime Minister as (Minister for Coal).
258. He proved the minutes of 35th Screening Committee meetings as are available from page 1-41 in file Ex. PW 14/H (Colly) (D-25) as Ex. PW 14/H-2 (Colly).
259. Vide note dated 23.10.2007 of Sh. Ashish Gupta, Director, PMO as is available at note sheet page 26 in file Ex. PW 14/F (Colly), approval of PMO qua recommendation of Screening Committee for 16 coal blocks and as were mentioned at para 16 (i) at page 20 of note sheet dated 14.09.2007 was approved beside also approving the suggestion on joint allocatees as was mentioned in para 16 (iii) of the note dated 14.09.2007.
260. Thereafter option letters were issued to joint allocatee companies by MoC .
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261. File of MoC bearing No. 38011/1/07-CA-I (IV) as is available in D-54, was also dealt with by the witness in MoC and is Ex. PW 14/J (Colly) (D-54).
262. Vide office copy of a letter dated 06.11.2007 [available from page 134-136 in file Ex.PW 14/J (Colly) (D-54)] option letter was issued to five joint allocatee companies of Fatehpur East coal block. The five companies to whom the letter was issued were (1) M/s JLD Yavatmal Energy Ltd.; (2) M/s R.K.M. Powergen Pvt. Ltd.; (3) M/s Visa Power Ltd.; (4) M/s Green Infrastructure Pvt. Ltd. And (5) M/s Vandana Vidyut Ltd. The option letter dated 06.11.2007 isEx. PW 14/J-1.
263. File of MoC bearing No. 38011/1/07-CA-I (V) as is available in D- 26, was also dealt with by the witness while being posted in MoC and is Ex. PW 14/K (Colly) (D-26).
264. The Joint Venture Agreement dated 29.11.2007, Ex. PW 3/L-1 [available from page 244-267 in file Ex. PW 14/K (Colly) (D-26)] executed between the five joint allocatee companies of Fatehpur East coal block was received in MoC vide letter dated 10.01.2008 [as is available at page 242]. The letter is Ex. PW 14/K-1. One letter dt. 29.11.2007 alongwith copy of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 103 of 405 agreement is Ex. PW 14/J-2 (Colly).
265. Vide office copy of a letter dated 22/23.01.2008 Ex. PW 3/M available from page 274-279 in file Ex. PW 14/K (Colly) (D-26) witness stated that after approval from senior officers the final allocation letter qua Fatehpur East Coal block was issued to the five joint allocatee companies.
266. He had also dealt with file of MoC bearing No. 38039/31/2007- CA-I (as is available in D-36) Ex. PW 5/B (Colly). The note sheet pages from page 1-8 are collectively exhibited as Ex. PW 14/L-1 (Colly) and the corresponding side pages from 1-107 are exhibited as Ex. PW 14/L-2 (Colly). The file pertained to "Govt.'s Mission to Eliminate Power Shortage and Ensure the Goal for the 11th Plan-Power for All by 2012".
267. He told that copy of a letter dated 18.06.2007 received from Sh. Vijay Darda, MP (Rajya Sabha) and addressed to Prime Minister was received from PMO. In the said letter a request was made for allocation of Lohara West and Extension coal block to JLD Yavatmal Energy Ltd. stating that Lokmat Media Group in India and Infrastructure Development Finance Co. Ltd. had joined hands for development of infrastructure sector and power projects and had decided to set up a 1215 MW thermal power plant in backward Wani Taluka CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 104 of 405 of Yavatmal District through a Special Purpose Vehicle viz. JLD Yavatmal Energy Ltd.
268. The said letter was put up by dealing assistant vide note dated 26.07.2007 with a draft reply to be sent to PMO for approval and the same was forwarded to his desk by Sh. R.N. Singh and he forwarded the same to Deputy Secretary, CA-I. The file was thereafter forwarded by Sh. K.C. Samria to Sh. K.S. Kropha and who further forwarded it to Sh. H.C. Gupta. Sh. H.C. Gupta approved the same vide his signatures dated 29.07.2007.
269. The various correspondences/ID notes of PMO are Ex. PW 14/L-3 (Colly), L-3A, L-4, L-5 (Colly), L-5A (Colly), L-6 (Colly), L-7 (Colly), L-8 (Colly) and L-9 (Colly). He identified signatures of A-5 to A-7 on these communications.
270. He told that the aforesaid communications received from PMO were dealt with in CA-I Section vide note dated 21.11.2007, put up under the signatures of dealing assistant at note sheet page 2-3 and mentioning about the Screening Committee meeting decision taken in the meeting held on 13.09.07, a draft reply was put up for approval to be sent to PMO. Sh. K.S. Kropha however vide his endorsement dated 23.11.2007 sought information about status CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 105 of 405 of preparedness of two projects and asked for a suitably modified draft to be put up. Thereafter on note sheet page 4, Sh. R.N. Singh put up a note of status of preparedness of projects of two companies i.e. M/s JLD Yavatmal and M/s Adani Power Ltd. Reply was sent to PMO vide letter dated 29.11.2007 [available from page 74-75 in D-36]. The letter is Ex. PW 14/L-10.
271. Another ID note dated 07.12.2007 of PMO was received in MoC and MoC was asked to respond to Chief Minister Maharashtra in reference to letter dated 26.10.2007. The ID note is Ex. PW 14/L-11. Reply was sent after approval of A-5 to A-7. Office copy of reply dated 30.01.2008 under the signatures of Sh. Dasari Narayan Rao (available at page 80-81 in D-36) is Ex. PW 14/L-12. PMO was also intimated.
272. He deposed that thereafter also on the directions of PMO the reply earlier sent to Chief Minister, Maharashtra, and intimation in this regard sent to PMO were again sent to PMO on their request to furnish comments in the matter. The said replies were also sent to President Secretariat as representation of Sh. Vijay Darda, MP regarding swapping of coal blocks between Fatehpur East and Lohara West in favour of M/s JLD Yavatmal Energy Ltd. was received.
273. The ID note dated 14.05.2008 of the office of President's CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 106 of 405 Secretariat [available at page 96-98] alongwith letter dated 06.11.2007 of Sh. Vijay Darda addressed to President of India regarding change of coal block from Fatehpur East to Lohara West and Extension was received in MoC. The same is Ex. PW 14/L-13 (Colly).
274. A reply vide office memorandum dated 24.06.2008 was sent to President's Secretariat enclosing therewith the earlier replies sent to PMO and to Chief Minister, Govt. of Maharashtra by MoC stating that the matter has already been dealt with. The office memorandum alongwith its enclosures as above is Ex. PW 14/L-14 (Colly). The request for swapping for coal blocks as above was however declined by MoC.
275. He was subjected to lengthy cross-examination. In cross- examination, it has come that there is no noting in the file pertaining to the aforesaid meeting held in the chamber of Joint Secretary Coal. But he also told that the said meeting however took place after issuance of advertisement but before receipt of applications.
276. He told that there were three routes of allocation of coal blocks at that time i.e. Screening Committee route, Govt. dispensation route and tariff based bidding process. All the aforesaid three process were looked after by CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 107 of 405 CA-1 Section.
277. He told that Central Secretariat Manual of Office Procedure, applies to all offices under Central Govt. including MOC.
278. The request dated 08.02.2007 [available at page 113 in file Ex. PW 16/K (Colly) (D-52)] was exhibited as Ex. PW 14/DX-1 (D-52) vide which four officials were called from CIL.
279. He denied that there was no lack of manpower or lack of any legal, technical or financial knowledge of CA-1 section or that he was introducing the said facts as an after thought. He denied that whatever lapses have taken place in the processing of applications were on account of his fault or that he in connivance with CBI was now introducing new facts so that he may be cited as a prosecution witness instead of being arrayed as an accused in place of MOC officers now facing trial.
280. He denied that he was introducing oral facts contrary to the written records in order to save his skin.
281. He was confronted with his statement u/s 161 Cr.PC dated 30.10.2012 which is Ex. PW 14/DX-2.
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282. Note dated 07.08.2006 available at note sheet page 10 to 22 in another file was exhibited as Ex. PW 14/DX-3 (Colly).
283. The certified copy of deposition of the witness recorded as PW-13 in case CC No. 04/14 titled CBI Vs. KSSPL & Ors. was exhibited as Ex. PW 14/DX-4.
284. He also stated that in the application of M/s JLD Yavatmal Energy Limited all the documents as were required to be annexed in accordance with Clause 1 Para A of guidelines were annexed with the application.
285. He admitted that the application of M/s JLD Yavatmal Energy Ltd. was a complete application. Accordingly the applicant company as per the advertisement issued by MOC was also an eligible company.
286. It is correct that copy of the applications were not sent to any authority by MoC till 12.02.2007. It is also correct that CA-I Section was required to send the copy of application to various authorities.
287. Another certified copy of deposition of witness is in another case was exhibited as Ex. PW 14/DX-5.
288. The list of applicants to be uploaded on the website of Ministry of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 109 of 405 Coal was sent to Sh. Piyush Goel, Technical Director, NIC, Ministry of Coal vide letter dated 16.03.2007 [ available at page 128 in file Ex. PW 14/A (Colly) (D-30)] and is Ex. PW 14/DX-6.
289. He told that initially when one copy of the applications were sent to Ministry of Power then they had refused to receive the same on the ground that they shall not be giving recommendations on the case to case basis as that ministry had already issued guidelines for processing of applications. Sh. R.N. Singh had put up a note dated 19.03.2007 in this regard bringing the aforesaid response of Ministry of Power to the notice of Under Secretary/Director/Joint Secretary for necessary instructions. He admitted that Sh. K.C. Samria had joined CA-1 initially as Dy. Secretary. He could neither admit nor deny the suggestion as to whether till 19.03.2007 Sh. K.C. Samria was not having the charge of CA-1 section.
290. He told that in the guidelines governing allocation of coal block issued by MOC the word "Scrutiny" was not mentioned anywhere.
291. He had sent letter dt. 11.05.2007 [available at page 97-98 in file Ex. PW 16/K (Colly) (D-52)] asking the applicant companies to submit requisite data in the prescribed format which is Ex. PW 14/DX-7 (Colly). CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 110 of 405
292. He did not remember whether any agenda with respect to Screening Committee meeting to be held on 11.05.2007 was prepared or not. The purpose of holding the meeting was mentioned in the notice of the meeting itself. A copy of agenda was shown to him alongwith office memorandum dated 07.05.2007 sent to Secretary, MoS under the signatures of witness himself qua meeting to be held on 11.05.2007. Photocopy of the office memorandum along with the agenda note is Ex. PW 14/DX-8 (Colly).
293. He stated that he was never in conspiracy or collusion with any applicant company or any one else at any point of time.
294. He told that as regard checking of applications for their eligibility and completeness the process followed at the time of 35 th and 36th Screening Committee was same as was earlier followed at the time of 34 th Screening Committee. He volunteered that to his knowledge the checking of applications for their eligibility and completeness did not take place even at the time of 34 th Screening Committee and the same was also not undertaken even at the time of 35th and 36th Screening Committee.
295. One letter dated 22.07.2006 addressed to Under Secretary CA-1 and written by Sh. P.R. Sharma Joint President Kesoram Industries Limited, CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 111 of 405 which mentions two lists i.e. "List A applications found complete on first scrutiny" and "List B applications found incomplete / invalid on first scrutiny"
in respect of 34th Screening Committee was exhibited as Ex. PW 14/DX-9 (Colly). There was objection as to mode of proof by Ld. DLA. (Objection is overruled as it was official communication received in MoC).
296. The list A is exhibited as Ex. PW 14/DX-10 and List B is exhibited as Ex. PW 14/DX-11.
297. He told that guidelines titled "Processing of application" as were issued by MOC in the year 2005 qua the applications invited with respect to 31 st to 34th Screening Committee meetings read as under:
"The applications received in the Ministry of Coal in five copies after being checked for eligibility and completeness would be sent to the administrative Ministry/State Govt. concerned for their evaluation and recommendations. After receipt of recommendations of the administrative Ministry / State Govt. concerned, the individual applicants would be heard by the Screening Committee in its meeting where they would be given an opportunity to present their respective case. Based on the recommendations of the Screening Committee, Ministry of Coal will determine the allotment. "
298. Photocopy of the said guidelines are Ex. PW 14/DX-12.
299. Guidelines titled "Processing of application" as were issued by MOC in the year 2006, available at page 28 in file Ex. PW 14/A (Colly) (D-30), CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 112 of 405 qua the applications invited with respect to 35 th and 36th Screening Committee meetings read as under:
"The applications received in the Ministry of Coal in five copies, after being checked for eligibility and completeness, would be sent to the administrative Ministry/State Govt. concerned for their evaluation and recommendations. After receipt of recommendations of the administrative Ministry/State Govt. concerned. The Screening Committee would consider the applications and make its recommendations. Based on the recommendations of the Screening Committee, Ministry of Coal will determine the allotment."
300. He told that he himself never carried out any checking of applications for their eligibility and completeness. In the initial days Sh. R.S. Negi along with one Peon or so was deputed to receive the applications but in the last two-three days the number of persons so deputed was increased.
301. Another certified copy of the deposition of witness recorded as PW 18 in the case CBI vs Y. Harish Chandra Prasad and Ors on six different dates was exhibited as Ex. PW 14/DX-13 (Colly).
302. His statement u/s 161 Cr.PC dated 30.10.2012 is Ex. PW 14/DX-
14.
303. He did not remember whether in any other coal block allocation matter pertaining to 35th and 36th Screening Committee meeting, he had stated in his statement u/s 161 Cr.PC regarding any such meeting held in the chamber of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 113 of 405 Joint Secretary Coal wherein modalities regarding receipt of applications and their subsequent processing was discussed and decided.
304. Witness was confronted with his statements u/s 161 Cr.PC recorded in the cases CBI Vs. Jas Infrastructure; CBI Vs. Y. Harish Chandra Pd. & Ors; CBI Vs. M/s KSSPL & Ors. and CBI Vs. Vikash Metal & Power Ltd. where there is no reference to any such meeting held in the chamber of Joint Secretary Coal. The statements u/s 161 Cr.PC recorded in the case CBI Vs. Vikash Metal & Power Ltd. are exhibited as Ex. PW 14/DX-15 (Colly). The statement u/s 161 Cr.PC recorded in the case CBI Vs. Jas Infrastructure is exhibited as Ex. PW 14/DX-16. The statements u/s 161 Cr.PC recorded in the case CBI Vs. Y. Harish Chandra Pd. are exhibited as Ex. PW 14/DX-17 (Colly). The statements u/s 161 Cr.PC recorded in the case CBI Vs. M/s KSSPL & Ors. are exhibited as Ex. PW 14/DX-18 (Colly).
305. Copy of the office memorandum dated 06.12.2007 of MoS is Ex. PW 14/DX-19 (Colly).
306. He admitted that till the final decision was arrived at by 35 th Screening Committee the applications along with their annexures as were lying at Scope Minar Laxmi Nagar were never brought to the office of MOC at CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 114 of 405 Shastri Bhawan, New Delhi. He admitted that applications pertaining to 35 th Screening Committee were sent to various stakeholders prior to the time when Mr. K.C. Samria took charge of CA-1 Section but with respect to applications sent to Ministry of Power, the same were resent during the tenure of Sh. K.C. Samria. He admitted that Ministry of Power earlier refused to receive the applications sent to them and the same were subsequently again sent.
307. Photocopy of MOC file bearing no. 38011/24/2004-CA-1 (Vol. I) as is available as D-60 in case CBI vs PSMPL was exhibited as Ex. PW 14/DX- 20 (Colly). He admitted that in the said file there are notings by A-6 K.S. Kropha whereby instead of Screening Committee route for allocation of captive coal blocks the auction route (bidding route) was advocated.
308. A certified copy of his statement u/s 161 Cr. PC dt. 13.01.2015 recorded in case CBI vs SKS and Ors bearing RC No. 219 2014 E 0015 was put to him for confrontation and is Ex. PW 14/DX-22
309. In cross-examination on behalf of A-1 to A-4, a copy of certified copy of counter affidavit dated 07.11.2008 filed by PW-14 filed in WP(C) No. 7135 of 2008 titled M/s Prakash Industries Ltd. Vs. Union of India was exhibited as Ex. PW 14/DX-21 (Ld DLA had objected to the mode of proof. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 115 of 405 The document was admitted by the witness hence objection is overruled).
310. A certified copy of a counter affidavit filed on behalf of Union of India as respondent no. 1 in W.P. (C) No. 6449/2008 before Hon'ble Delhi High Court dt. 16.07.2009 filed under his signatures was also referred to.
311. PW-17 is Sh. Ved Parkash Sharma. He had retired as Section Officer from CA-I Section, MoC in June 2013. He had handed over various documents/files to CBI. He identified his signatures on memo dated 18.06.2012 [Ex. PW 16/E as available in D-29]; on memo dated 02.06.2012 [Ex. PW 16/B as available in D-22]; and on memo dated 08.06.2012 [Ex. PW 16/D as available in D-37]. He identified document D-38 also which was handed over vide Ex. PW16/D and which is Ex. PW 17/A (colly). The form for feedback of JLD Yavatmal Energy Ltd. is already exhibited as Ex. PW 3/J-1. He had also filed his affidavit in evidence which is Ex. PW 17/B (colly).
312. In cross-examination on behalf of A-5, he told that while being posted in MoC, he had not dealt with any of the aforesaid documents which were handed over by him to CBI.
313. In cross-examination on behalf of A-1 to A-4, he told that in case any senior officer gives any oral instructions to carry out any work then if the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 116 of 405 work is urgent then the same is first carried out and thereafter written orders are subsequently obtained in the files but otherwise any work or directions to be carried out is only after the same is put into writing in the file. In case of furnishing of any information to any senior officer then if any information is to be given to the senior officer then the same is given orally when the note is put up otherwise if the note is to be redrafted then the same is put afresh in the file.
314. PW- 23 is Sh. S.K. Shahi. He was a Central Secretariat Service Officer of 1988 batch. From February 2013 till July 2016, he was posted in MoC, Govt. of India, initially as Director and subsequently as Joint Secretary. As Director he was Incharge of CA-I Section MoC and as Joint Secretary he was having charge of CA-I Section as well as some additional work.
315. He told that CA-I Section deals with coal block allocation matters. During the year 2013, he had made certain correspondence with CBI with regard to investigation of coal block allocation matters. He told that vide a communication dated 04.06.2013 [Ex. PW 20/A (D-17)] issued under his signatures, he had furnished to CBI the details of the coal blocks allocated to M/s Abhijeet Infrastructure Ltd., M/s Corporate Ispat Alloys Ltd. and M/s Jayaswal Neco Industries Ltd.
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316. Vide office memorandum dated 03.05.2013, available in D-18, he had replied to CBI's letter No. 1043/3/coal scam cases dated 04.02.2013 as under:
" New Delhi dated 3rd May, 2013
OFFICE MEMORANDUM
Sub: Investigation of CBI case No. RC 219-2012-E-0008, RC 219-2012-
E-0009 and RC 219-2012-E-0010-Reg.
Reference is invited to CBI's letter No. 1043/3/Coal scam cases dated 04.02.2013 on the above subject and to say that the column No. 29 and 30 of the application format for applying for allocation of coal blocks are meant for furnishing the information by the applicant company regarding earlier coal blocks allocated to the applicant company or its group/associated companies. From the records available, the rationale/logic for keeping column No. 29 & 30 in the application form could not be ascertained. However, the Guidelines for allocation (copy enclosed) inter alia provide for the evaluation criterion of technical experience (in terms of existing capacities in coal/lignite mining and specified end use) and track record, which could have possible link to the column no. 29 and 30 in the application form.
Encls: AA Sd/-
(S.K. Shahi) Director"
317. The copy of office memorandum dated 03.05.2013 as above is exhibited as Ex. PW 23/A (colly) (D-18) (Earlier marked as Mark PW 20/P-
2 (colly)).
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318. Vide office memorandum dated 02.05.2013 [as is available in D-19], he furnished reply to CBI in response to their various queries as were raised by them with MoC vide their following communications:
• CBI's letter No. 2225/3/15/2012 EOU-V, DELHI dated 21.03.2013 received from Shri V. Murugesan, DIG/CBI, EO.II.
• CBI's letter No. 2226/3/15/2012 EOU-V, DELHI dated 21.03.2013 received from Shri V. Murugesan, DIG/CBI, EO.II.
• CBI's letter No. 2553/RC: 219 2012 E 0011/EOU-IV, dated 02.04.2013 received from Shri K.L. Moses, Inspector of Police/CBI, EOU-IV. • CBI's letter No. 2131/3/RC-219-2012-E-0010 dated 15.03.2013 received from Dr. V. Murugesan, HOB/CBI, EO-II.
• CBI's letter No. 2629/3/16/2012, EO-V, DELHI dated 05.04.2013 received from Shri Sanjay Dubey, Inspector of Police/CBI, EOU-V. • CBI's letter No. 12054/3/16/2012, EO-V, DELHI dated 05.12.2012 received from Shri Sanjay Dubey, Inspector of Police/CBI, EOU-V.
319. His response to the aforesaid queries was as follows:
"2. In this regard, it is informed that from the records/documents as available, it is seen that the applications received from the applicant companies for allocation of 38 coal blocks (15 power blocks which were considered in 35 th Screening Committee meetings and 23 non-power blocks which were considered in 36 th Screening Committee meetings) advertised in November, 2006 do not appear to have been checked for the eligibility and completeness in the Ministry of Coal before sending to administrative Ministries/State Govts. for examination and comments thereon. However, a set of applications received was also sent to CMPDIL, which is a technical organization under CIL, for examination and comments. Further, as per the minutes of 35 th Screening Committee, it is seen that it was decided that the State Govts. may be asked to carry out a quick verification of the data used by the Ministry of Power for techno-economic evaluation of end use projects. Minutes further record that the verification reports were received from most of the State Govts.. It also appears from the records that the Screening committee had not entrusted the job of checking of applications to any official.
The Feedback form and presentation made by M/s Kamal Sponge Steel & Power Ltd. Could not be located in the concerned Section in the Ministry No. circulars/office orders/guidelines etc. describing the role of officers/officials of Ministry of Coal during the process of allocation of coal blocks by 35 th and 36th Screening Committee were found to have been issued."
320. The copy of office memorandum dated 03.05.2013 as above is exhibited as Ex. PW 23/B (D-19) (Earlier marked as Mark PW 20/P-3 (colly). CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 119 of 405
321. Nothing has come out in cross-examination.
FROM MINISTRY OF POWER/CEA
322. PW-18 is Sh. Manjit Singh Puri. He is from CEA. During the year 2006-07, he was posted as Director Thermal Project Investigation (TPI) Division. At that time his main duties were to monitor development of new thermal power projects in the country. He was also looking after the work of Site Selection Committee (SSC) qua thermal power projects and Chief Engineer TPI was the Member Secretary of the Committee. The Committee was headed by Member (Thermal) CEA. He was also looking after the work of development of Ultra Mega Power Projects (UMPP) in the country.
323. He deposed that CEA is the Apex technical body in the power sector and was constituted under Electricity Supply Act, 1948. Under the new Act promulgated in the year 2003 also, CEA was again recognized.
324. He deposed that in the month of June 2007, he along with some other CEA officers had attended certain Screening Committee meetings of MoC held at Scope Minar, Laxmi Nagar on the directions of MoP. He was so deputed CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 120 of 405 to attend the Screening Committee meetings by his Chief Engineer Sh. S. Seshadri. In the said Screening Committee meetings, presentations were made by various applicant companies. However, he had not attended all such meetings. The said meetings pertained to 35th Screening Committee.
325. The instructions given to him were to listen to the presentations being made in the Screening Committee meetings and to collect information, if any, made available in the meetings and thereafter to compile them later in the office.
326. He deposed that during the aforesaid meetings, the applicant companies had supplied to them a feedback form beside also providing hard copy of their presentations so made before the Screening Committee.
327. He identified his signature on attendance sheet of Screening Committee meeting held on 21.06.2007 [part of Ex. PW 14/E-3 (Colly) (D-23)] and held on 23.06.2007 [part of Ex. PW 14/E-3 (Colly) (D-23)]. The attendance sheets dated 21.06.2007 and 23.06.2007 were separately also exhibited as Ex. PW 18/A (page 110-111) and as Ex. PW 18/B (page 114-115).
328. He deposed that during the course of said meetings, no minutes of the meetings were drawn.
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329. Subsequent to the aforesaid two Screening Committee meetings, he did not attend any other Screening Committee meeting of MoC. However, during the course of aforesaid meetings, none of the officers of CEA who attended the said Screening Committee meetings had given any recommendations qua any company.
330. After few days of attending the aforesaid meetings, their Chief Engineer directed them to compile the information pertaining to various applicant companies received during the course of Screening Committee meetings in a given format. The said format was prepared under the supervision of Chief Engineer TPI Sh. S. Seshadri.
331. After compilation of all the aforesaid data, the first exercise carried out by CEA was as regard the pre-qualification criteria i.e. the criteria pertaining to networth and capacity of proposed project. The letter of Jt. Secy. (Power) had also stated that the networth criteria be adopted as that of Ultra Mega Power Project (UMPP). The said networth criteria was that of 0.5 crore per MW. After seeing communication dated 13/16.07.2007 of Sh. S. Seshadri, Chief Engineer TPI, CEA and as addressed to Sh. A.K. Kutty, Joint Secretary, MoP witness stated that the second criteria regarding capacity was stated as under:
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 122 of 405 "(b) Project Capacity Min. of Coal while inviting applications for coal block allocations had indicated that priority shall be accorded to projects with more than 500 MW capacity. Since for each coal block there are more than one applications, the applicants who have applied for projects having less than 500 MW capacity have not been prequalified."
332. The aforesaid communication is Ex. PW 18/C (Colly) (available from page 131-219). After pre-qualification criteria was applied, thereafter, short listing of applicant companies was also carried out in accordance with the criteria mentioned in para 4 of aforesaid communication Ex. PW 18/C (Colly).
333. He deposed that CEA had not carried out verification of any of the aforesaid information furnished by the applicant companies. In fact in the communication Ex. PW 18/C (Colly) in para 6 the following facts were also mentioned.
"6. It is suggested that while allocating the coal blocks, the following aspects may be considered by the Screening Committee:
i) Some of the coal blocks are bigger in size and these may be allocated to more than one applicants.
ii) Only one block per applicant may be allocated.
iii) Coal blocks may also be allocated to the applicants for captive power plants as per MoP letter No. FU- 10.2005-IPC dated 12.10.06 addressed to Ministry of Coal,
iv) Priority may be given to projects proposed to be located near the coal blocks to avoid burden on Railways for coal transportation. The short listing of the applicants has been made based on the information furnished by the applicants in their feedback form/ presentation made to the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 123 of 405 Screening Committee. It is suggested that the details as presented by them may be got verified before allocating the blocks. This issues with the approval of Chairperson, CEA."
334. He further deposed that after the aforesaid communication was sent to MoP then some of the applicant companies supplied some additional information directly to CEA. Upon receipt of said updated information, fresh communication was sent to MoP by CEA based on the said updated information.
335. He had also signed a communication dated 17.07.2007 issued to Sh. A.K. Kutty, Joint Secretary, MoP [available at page 229 in file of CEA bearing no. 144/GC/BO/CE (TPI)/2007]. Office copy of the aforesaid communication is Ex. PW 18/D (AD-5).
336. While being posted in CEA, he had dealt with file of CEA bearing no. 144/GC/BO/CE (TPI)/2007 and file bearing no. 144/GC/BO/CE (TPI). Copy of file bearing no. 144/GC/BO/CE (TPI)/2007 is Ex. PW 18/E (Colly) [AD-5]. Copy of file bearing no. 144/GC/BO/CE (TPI) is Ex. PW 18/F (Colly) [AD-6].
337. The rough work sheets/charts of CEA are collectively exhibited as CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 124 of 405 Ex. PW 18/G (Colly) and Ex. PW 18/H (Colly).
338. He had also signed another communication dated 26.07.2007 [available from page 1-10 in file Ex. 18/F (Colly) (AD-6)] vide which further updated information was sent to MoP by CEA. The copy of aforesaid communication dated 26.07.2007 is Ex. PW 18/J (Colly).
339. He had further signed communication dated 30.07.2007 available from page 58-86 in file Ex. PW 18/F (Colly) (AD-6) vide which the block wise recommendation for allocation of coal blocks to IPPs / CPPs along with summary of recommendations were sent with the approval of Chairperson CEA. The office copy of communication dated 30.07.2007 is exhibited as Ex. PW 18/K (Colly).
340. He identified signature of Sh. A.K. Kutty on a letter dated 26.06.2007, [available from page 233-235 in file Ex. PW 18/E (Colly) (AD-5)] vide which he had asked Chairman CEA, Sh. Rakesh Nath to document the presentations made before the Screening Committee, MoC on the basis of parameters already indicated and other factors which were mentioned in a communication dated 20.06.2007 to Secy. (Coal) by Secretary Power Sh. Anil Rajdan. Copy of said communication was enclosed with the letter dated CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 125 of 405 26.06.2007 of Sh. A.K. Kutty.
341. In the letter of Secretary, Power as was addressed to Secy. (Coal), the following facts were mentioned in para 2:
"2. The Ministry of Coal had indicated that "priority shall be allocated to projects with more than 500 MW capacity". Further, Ministry of Coal had indicated that the "inter-se priority for allocation of a block among competing applicants for a captive block may be decided as per the following guidelines:
1*. Status (stage) level of progress and state of preparedness of the projects.
2*. networth of the applicant company (or in the case of a new SP/JV, the networth of their principals).
3. Production capacity as proposed in the application.
4. Maximum recoverable reserve as proposed in the application.
5. Date of commissioning of captive mine as proposed in the application.
6. Date of completion of detailed exploration (in respect of unexplored blocks only) as proposed in the application.
7*. Technical experience (in terms of existing capacities in coal/lignite mining and specified end use).
8*. Recommendation of the Administrative Ministry concerned.
9. Recommendation of the State Govt. concerned (i.e. where the captive block is located).
10*. Track record and financial strength of the company. An examination of the conditions reveals that the Ministry of Power would have to be associated with the SL Nos 1*, 2*, 7*, 8* and 10* above."
342. The letter is Ex. PW 18/L (Colly) (AD-5).
343. Subsequent to sending the block-wise recommendation as above, a CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 126 of 405 note was sent by CEA to the MoP informing them about the detailed methodology adopted by CEA in making the said recommendations qua various applicant companies.
344. He deposed that vide communication dated 24/27.08.2007, addressed to Joint Secretary, MoP, the methodology adopted for pre- qualification, short-listing and block-wise recommendation for allocation of coal block to IPPs/CPPs was sent to MoP. Copy of the said communication is Ex. PW 18/M (Colly) [available from page 179-184 in file Ex. PW 18/F (Colly) (AD-6)].
345. He deposed that vide communication dated 30.07.2007 Ex. PW 18/K (Colly), as regard company M/s JLD Yavatmal Energy Ltd., the recommendation was made by CEA in favour of the company qua allocation of Fatehpur (East) Chhatisgarh, coal block and to be shared equally with three other companies i.e. M/s TRN Energy Pvt. Ltd. M/s R.K.M. Powergen Pvt. Ltd. and M/s Mahavir Global Coal Ltd. He identified signature of Sh. Rohtash Dahiya on five recommendation sheets of 35th Screening Committee meeting Ex. PW 13/D (Colly) (D-25).
346. In cross-examination on behalf of A-1 to A-4, he stated that he was CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 127 of 405 not aware as to whether MoP communicated their decision to adopt UMPP criteria for prequalification to MoC or not. He told that UMPP guidelines were part of standard bid documents qua tariff based competitive bidding process. The Ultra Mega Power Projects were power projects of capacity 4000 MW.
347. In cross-examination on behalf of A-5 to A-7, his statement u/s 161 CrPC was exhibited as Ex. PW18/DX-1. Some note sheet dated 06.07.2007 as is available from page 8-9 in the noting file of CEA bearing no. 144/GC/BO/CE (TPIA) was also exhibited as Ex. PW 18/DX-2. A draft communication with necessary changes available in file Ex. PW 18/E (Colly) (AD-5) from page 45- 47 was exhibited as PW 18/DX-3. One noting file i.e. file 144/GC/BO/CE (TPIA) was exhibited as Ex. PW 18/DX-4 (Colly) and noting file i.e. file 144/GC/BO/CE (TPI)/2007 was exhibited as Ex. PW 18/DX-5 (Colly).
348. He was confronted with his deposition dated 18.04.2018 as was recorded in case RC No. 219 2012 E 0011 titled CBI Vs. Y. Harish Chandra Prasad & Ors. The certified copy of deposition of the witness as above is exhibited as Ex. PW 18/DX-6 (Colly).
349. The communications dated 22.12.2005 and 27.10.2005 were exhibited as Ex. PW 18/DX-7 and Ex. PW 18/DX-8.
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350. He admitted that M/s JLD Yavatmal Energy Ltd. was found to be a suitable company by CEA to be recommended for allocation of a captive coal block but explained that the said recommendation was made on the documents/information available with them and criteria adopted by CEA.
351. He also told that vide office order dated 06.07.2007 [available at page 95-96 in file Ex. PW 18/E (Colly) (AD-5)], a committee was constituted in CEA to give recommendations for long term coal linkages/allotment of coal blocks for power plants comprising of Chief Engineer, TPA Division; Chief Engineer, IRP Division and Chief Engineer, OM Division. The office order dated 06.07.2007 as above is exhibited as Ex. PW 18/DX-9 (AD-5).
352. One presentation of "Rashmi Group" was exhibited as Ex. PW 18/DX-10. The presentation of Bhusan Energy Ltd. and Simhapuri Energy Private Limited were also exhibited as Ex. PW 18/DX-11 and Ex. PW 18/DX- 12 respectively.
353. PW-19 is Sh. Anil Kumar Kutty. He was posted as Joint Secretary, Ministry of Power, Govt. of India from July 2002 to August 2007.
354. While being posted in MoP he was looking after various divisions including IP Cell i.e. Investment Promotion Cell. The IP Cell was primarily CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 129 of 405 promoting investment in the power sector in the country in accordance with the policies of Govt. of India by attracting private investment in the power sector.
355. He deposed that the Thermal Section in MoP was primarily looking after coal requirements of power sector and IP Cell was also associated with the said work in respect of private power projects. As regard role of MoP in the coal block allocation process by MoC, he told that the MoP had taken a decision in the year 2006 that it would not make recommendation in favour of any specific company on case to case basis and had initiated a policy of inter se priority between different applicant companies for a given coal block or for coal linkage.
356. He stated that he had dealt with file of MoP Ex. PW 16/M-1 (Colly) (D-53), while being posted in MoP. He stated that priority was to be first given to Govt. of India undertakings followed by State Govt. undertakings and thereafter private sector power projects selling power to state discoms through tariffs determined by regulatory commissions and thereafter private sector power projects selling at least 25% of the power produced to the grid and finally as a last priority to the private sector captive power projects.
357. After seeing note sheet pages 44-47 in note sheet pages in file Ex. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 130 of 405 PW 16/M-1 (Colly) (D-53), witness stated that vide a detailed note dated 18.06.2007 Sh. Sanjay Chadha Director (IPC) had put up the file stating that 746 applications (in 22 trunks) had been sent to MoP by MoC for comments qua allotment of 15 captive coal blocks. It was also stated that in the guidelines of allocation of captive coal blocks issued by MoC it was stated that the inter se priority for allocation of a block among competing applicants for a captive block may be decided as per their guidelines.
358. He further stated that however the key parameters indicating project preparedness and the qualifying networth criteria link to the size of the coal mines had not been indicated and the said criteria would also be a crucial meaningful screening criteria of the applications. The note sheet bears signatures dated 18.06.2007 of Sh. Sanjay Chadha below his note. After the file was put up before him then he put up a detailed note under his signatures dated 19.06.2007 and observed in para 3 as under:
"3) From the point of view of the Ministry of Power, the following issues needs to be taken into account while deciding our response.
a) the representative of Ministry of Power is only one among the 13 members of the Screening Committee.
b) the Ministry of Coal has already announced the "guidelines for inter-se priority for allocation of blocks among competing applicants" and the recommendation of the administrative ministry is just one (S. No. 10) out of the ten criteria.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 131 of 405
c) however, an examination of the conditions shows that the Ministry of Power would directly/indirectly have to be associated with the Sl. Nos. 1*, 2*, 7*, 8* and 10* (para 2 above)."
359. He deposed that he also proposed in his note that as MoC was holding presentation by the applicants i.e. from 20 th to 23rd June and as MoP had so far not made any case wise examination of the applications and had also not made any recommendations to the MoC and also that Secy. (Power) had already intimated to Secy. (Coal) in his letter that the views of MoP would be communicated by the Ministry's representatives at the Screening Committee, so, considering that over 740 presentations would be made before Screening Committee the official recommendation of the MoP would be possible only if the data and presentations made by the developers before the Screening Committee are analyzed and processed on file for approval of the Secretary/Minister of power. He further proposed for asking CEA to attend the presentations and document the same for analysis. The note was thereafter approved by Sh. Anil Razdan Secy. (Power). Subsequently, Sh. Sushil Kumar Shinde the then Minister of Power also approved the said note.
360. Thus the networth which was required to be seen was for the purpose of assessing the capacity of the organisation to raise sufficient funds for establishing the power project in question.
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361. The note sheet pages from page 1-64 in file Ex. PW 16/M-1 (Colly) are collectively Ex. PW 19/A (Colly). The correspondence side pages from page 1-295 are collectively Ex. PW 19/A-1 (Colly).
362. The stand of MoP was communicated to MoC vide DO letter dated 20.06.2007 [available from page 66-67 in correspondence side pages Ex. PW 19/A-1 (Colly)]. The DO letter dated 20.06.2007 is Ex. PW 19/A-2. The Secy. (Coal) replied vide a DO letter dated 30.06.2007 available at page 71. The letter dated 30.06.2007 is Ex. PW 19/A-3 (D-53).
363. He deposed that as applications of various companies were received in 22 trunks in MoP from MoC but as MoP had already taken a decision not to make recommendation on case to case basis but as they were told that presentations would be made before the Screening Committee by all the applicant companies so they asked CEA officers to attend the presentations in MoC.
364. He deposed that vide a letter dated 26.06.2007 [available from page 69-70 in correspondence side pages] Chairman CEA Sh. Rakesh Nath was requested to have the presentations made by various applicant companies expeditiously documented on the parameters already indicated. The following CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 133 of 405 facts were mentioned to Sh. Rakesh Nath.
"Please refer to this Ministry's D.O. letter of even number dated 20.06.2007 from Secretary, Ministry of Power to Secretary, Ministry of Coal (copy enclosed). Since the presentations made by the developers before the Screening Committee on coal blocks in the Ministry of coal are now over, I would request you to kindly have these presentations expeditiously documented on the parameters already indicated. The level and state of preparedness being an important criteria, these should be analyzed in a transparent manner against tangible and verifiable yardsticks like land acquisition, water linkages and other required statutory clearances etc. The networth of the applicant company should be only a qualifying criteria and the yardstick \adopted for the UMPPs may be adopted for analyzing these projects also. I request you to kindly complete this analysis and get it computerized and sent to us latest by 2nd July, 2007 so that the matter could be further taken up for making formal recommendations to the Ministry of Coal. The matter may be treated as Most Immediate"
365. The office copy of letter dated 26.06.2007 as above is Ex. PW 19/A-4 (Colly).
366. He told that a communication dated 13/16.07.2007 Ex. PW 18/C (Colly) (available from page 131-219) was received from CEA enclosing therewith a list of short-listed applicant companies based on the information furnished by the applicants in their feedback form/presentation made to the Screening Committee. It was also suggested that the details as presented by them may be got verified before allocation of the blocks.
367. Subsequently another communication dated 26.07.2007 was CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 134 of 405 received from CEA furnishing details of certain other companies who were earlier not short-listed but had since furnished some additional information regarding tie-up of land or water or as regard enhanced networth figures. The communication dated 26.07.2007 is Ex. PW 19/A-5 (Colly) [available from page 220-229 in file Ex. PW 16/M-1 (Colly) (D-53)].
368. PW-19 had also dealt with another file bearing No. FU-10/2003- IPC B-II Ex. PW 16/M-2 (Colly) (from page 1-318) as is available in D-32, while being posted in MoP.
369. A communication dated 30.07.2007 available from page 49-78 in file Ex. PW 16/M-2 (Colly), was received from CEA vide which the blockwise recommendations for allocation of coal blocks to IPPs/CPPs alongwith summary of recommendations were sent. In the said communication the earlier three communications dated 13.07.2007, 17.07.2007 and 26.07.2007 of CEA were also referred to. The communication dated 30.07.2007 as above is exhibited as Ex. PW 19/B (Colly).
370. PW-19 put up a note dated 30.07.2007 on note sheet page 53 in file Ex. PW 16/M-1 (Colly) (D-53) to Secy. (Power) stating that the recommendations of CEA may be accepted and be forwarded to MoC as the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 135 of 405 recommendation of Ministry of Power for consideration in the Screening Committee. Subsequently, vide letter dated 30.07.2007 (available from page 38-
41) addressed to Sh. H.C. Gupta, Secy. (Coal), by Sh. Anil Razdan, Secy. (Power), the recommendation of MoP were forwarded. The office copy of letter dated 30.07.2007 alongwith summary of recommendation as enclosed is collectively exhibited as Ex. PW 19/B-1 (Colly) (available from page 38-41).
371. He identified signature of Sh. Sanjay Chandha on communication dated 24/27.08.2007 available from page 80-85 in file Ex. PW 16/M-2 (Colly) (D-32) received from CEA which is Ex. PW 19/B-2 (Colly) (from page 80-85) There was objection as to mode of proof but the same is overruled as it was official communication.
372. Vide a communication dated 29.05.2007 [available from page 55- 59 in file Ex. PW 14/D (Colly) (D-24)] addressed to Sh. H.C. Gupta, Secy. MoC, Minutes of the coal coordination committee meeting held on 18.05.2007 in MoP were sent. The office memorandum dt. 29.05.2007 as above is Ex. PW 19/C (Colly) (There was objection as to mode of proof but the same is overruled as file was already exhibited).
373. In cross-examination, he told that the issue of net-worth of the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 136 of 405 organization concerned which is desirous of establishing the captive power project and the process also seeking allocation of a captive coal block is important as such projects are capital intensive projects. For establishing a power plant an investment of the order of Rs. 4 Crore per mega watt is required and as they were considering power projects of the capacity 500MW and above beside also requiring capital for opening a coal mine so the issue of net-worth became important. Thus, the capacity of the organization to raise sufficient funds became important. He told that this in a way was reflection of one of the factor mentioned in the inter se priority guideline issued by MOC i.e. track record and financial strength of the company.
374. Upon being asked to explain the meaning of the factor mentioned at point II in the inter se priority guideline issued by MOC i.e. "Net-worth of the applicant company (or in the case of a new SP/JV, the net-worth of their principals)", the witness stated that as the net-worth of the applicant company was to be seen so in cases where either a special purpose vehicle had been formed or joint venture company had been formed by two or more company then in that situation the net-worth of principals thereof was to be seen, as a new company might not have any networth of its own.
375. He was aware that IL&FS or IDFC did associate with other CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 137 of 405 companies to set up power projects in the country.
376. Regarding suggestion that the purpose of aforesaid association with IL&FS and IDFC was to use their financial strength by the company getting associated with them, he answered that the issue was debated extensively in Ministry of Power in the year 2005-06 when the matters relating to establishing the Ultra Mega Power Projects (UMPP) were being considered and it was decided that the financial strength of such financial institutions could be taken into consideration provided the said financial institution had by way of a specific board resolution and agreement to participate in equity had been entered into for setting up the specific project.
377. Upon being asked as to what weight was to be assigned to the ten factors mentioned in the inter se priority guidelines issued by MOC, the witness stated that it was for the Screening Committee to consider and decide and not for Ministry of Power.
378. He confronted with his statement statement u/s 161 Cr.PC dated 22.05.2013 which is Ex. PW 19/DX-1 on some aspects.
379. In cross-examination on behalf of A-5 to A-7, it has come that UMPP criteria was in public domain.
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380. One office memorandum dated 12.10.2006 [available from page 24-27, in file Ex. PW 16/M-2 (Colly) (D-32)], vide which MoP had informed Secretary, Coal that three lists of coal blocks had been identified by MoP in consultation with MOCwas exhibited as Ex. 19/DX-2 (Colly).
381. He admitted that since 2004, MOC was trying to do away with Screening Committee route for allocation of captive coal blocks. He believed that MoP had taken a view that MOC should continue with Screening Committee route for allocation of captive coal blocks.
382. Copy of a note dated 13.12.2006, titled "Note for the cabinet"
issued by Ministry of Mine, Govt. of India with the subject "Proposal for introducing auctioning of coal mining blocks for captive use through competitive bidding as the selection process for allocation by amending the Mines and Minerals (Development & Regulation) Act, 1957" was exhibited as Ex. PW 19/DX-3 (Colly).
FROM GOVT. OF MAHARASHTRA
383. PW-13 is Sh. Vinesh Kumar Jairath. In April/May 2007, he was posted as Principal Secretary, Industries, Govt. of Maharashtra. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 139 of 405
384. He deposed that he had been associated with the allocation of captive coal blocks by MoC, being Principal Secretary, Industries, Govt. of Maharashtra. The State Govt. of Maharashtra had received various applications from MoC of different applicant companies who had applied to MoC seeking allocation of captive coal blocks. Govt. of Maharashtra was required to submit its comments/views/recommendations to MoC on all such applications so received by it.
385. He told that Govt. of Maharashtra had decided that recommendation would be sent to MoC in favour of those companies who intended to invest in the State of Maharashtra and which would help in the industrial and economic development of Maharashtra, creation of employment and power generation in the state as the state was facing acute power shortage.
386. He deposed that company namely M/s JLD Yavatmal Energy Ltd. had also applied for allocation of a number of captive coal blocks situated in state of Maharashtra and even outside the state. In this process, Govt. of Maharashtra had made a recommendation to MoC, Govt. of India in favour of M/s JLD Yavatmal Energy Ltd. The letter in this regard is letter dated 23.05.2007 [as available at page 35, in MoC file bearing No. 38011/1/2007-CA- I (Volume I) (D-24)] and is Ex. PW 13/A. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 140 of 405
387. He also proved letter dt. 21.05.2007of Sh. Rahul Asthana, Principal Secy. (Energy), Govt. of Maharashtra addressed to Secy. (Industries), Govt. of Maharashtra vide which Sh. Rahul Asthana had recommended the proposal of M/s JLD Yavatmal Energy Ltd. for allocation of a captive coal block and had requested Secretary Industries to forward the request of the company to MoC. The letter is Ex. PW 13/B.
388. Upon being asked as to on what basis the letter of recommendation dated 23.05.2007 Ex. PW 13/A was issued by him, the witness stated that some time in February 2007 on the request of Darda Group, whereby they had proposed to establish a power project in the state of Maharashtra, a letter of support in accordance with the Power Policy, 2005 of Govt. of Maharashtra was issued to the proposed power project. Thereafter in April 2007, the Darda Group had probably met Chief Minister as a meeting was arranged in the office of Chief Minister which was attended by Minister of Power, Minister of Finance beside Secretaries of various other departments. In the said meeting the representatives of Darda Group had stated that they intended to establish the power project in Yavatmal District and after discussion, it was decided that letter of support on various issues relating to the power project be issued by the concerned department. Minutes of the said meeting was also drawn by CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 141 of 405 department of power. He was also present in the said meeting. In the said meeting Sh. Vijay Darda, Sh. Rajender Darda and Sh. Devender Darda had participated on behalf of Darda Group. He identified accused Vijay Darda and Devender Darda in the Court.
389. He deposed that in connection with allocation of captive coal blocks, he had attended only one meeting of 35th Screening Committee in MoC, New Delhi on 13.09.2007. The then Chief Minister of Maharashtra, Sh. Vilas Rao Deshmukh, had directed him to attend the said meeting on behalf of govt. of Maharashtra.
390. The said meeting held on 13.09.2007 was scheduled to be held in afternoon and was called to decide about allocation of various captive coal blocks. He came from Mumbai on 13.09.2007 itself in the morning and straight away went to Shastri Bhawan MoC office and reached there at about 2 PM.
391. As far as he remembered, no presentation from any applicant company was made in the said meeting in his presence. The meeting started about 2.15/2.20 PM i.e. a bit late from its scheduled time. At the beginning of the meeting, he requested the Chair that as only one coal block namely Lohara West and Extension situated in the State of Maharashtra was under
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 142 of 405 consideration in the said meeting so the matter regarding allocation of the said coal block might be taken up initially as he was to rush back to Mumbai to attend some urgent work.
392. As Govt. of Maharashtra had recommended allocation of Lohara West and Extention coal block in favour of M/s Adani Power Ltd. so he reiterated the stand of Govt. that the said coal block might be allotted in favour of M/s Adani Power Ltd. as the company had taken effective steps towards setting up the power project in the state of Maharashtra.
393. After reiterating the stand of the Govt. of Maharashtra, he sought leave of the Chair to leave the meeting and upon which he was told to sign certain papers on which the name of Lohara West and Extension coal block was mentioned with certain columns in a tabular form requiring signatures and he was asked to sign on the said form. As far as he remembered nothing else was written on the said paper except the name of the block. He was also asked to sign similar other papers carrying names of other coal blocks. As he had already signed the attendance sheet of the meeting so he asked as to why he had to sign papers pertaining to other coal blocks and upon which he was told that as other members present would be required to sign the paper relating to Lohara West and Extension coal block so similarly he was required to sign similar papers CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 143 of 405 pertaining to other coal blocks under consideration. He accordingly signed the tabular forms of all the blocks and as he was the first to leave the meeting and to sign the said papers so his name and signatures appear at number 1 on all such papers. Thereafter he left the meeting venue and took the return flight to Mumbai at about 4.30 PM. He thus remained in the meeting for about 30-40 minutes.
394. He identified his name and signatures at S. No. 12 and that of V.S. Sawakhande, Director, Geology and Mining, Govt. of Maharashtra at S. No. 16. The copy of the attendance sheet as is available at page 81-82 in MoC file D-
25. The attendance sheet is Ex. PW 13/C.
395. He identified his name and signature on recommendation sheets of 35th Screening Committee meeting as are available from page 83-87, His name and signatures have been encircled in red and is marked as point A. The five recommendation sheets are collectively exhibited as Ex. PW 13/D (colly).
396. Upon being asked as to whether on the five recommendation sheets on which the witness put his signatures at S. No. 1, the other matter i.e. the names of various companies or the name of the state where the end use plant is situated or names and signatures of other members of the Screening Committee CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 144 of 405 was there when he signed the said recommendation sheets, witness stated that when he signed the recommendation sheets only the typed matter i.e. headings of various columns such as the name of state, blocks, recommended allottee, end use plant, name, signature and names of various blocks was there and no matter which is now handwritten on the said recommendation sheets was there. Till the time he remained in the meeting recommendation qua none of the coal blocks was yet made by the Screening Committee including that of Lohara West and Lohara Extension.
397. He stated that till the time he remained in the meeting no discussion or deliberation qua any other coal block took place in the Screening Committee meeting. He was not aware of any methodology, if adopted by the Screening Committee in reaching on various recommendations as mentioned in the recommendation sheets Ex. PW 13/D (colly) in favour of different applicant companies qua various coal blocks.
398. In the said meeting no information or data of any of the applicant companies was provided to me by MoC. During my presence no report of any financial expert who might have examined the financial strength of the applicant companies was put up in the meeting.
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399. He stated that he had not seen the minutes of meeting of 35th Screening Committee as was held on 13.09.2007 till the time he was posted in Govt. of Maharashtra i.e. till 31.03.2008. The minutes were never put up before him either for confirmation or for approval.
400. Though I had not brought any written communication of Govt. of Maharashtra in favour of M/s Adani Power Ltd. qua Lohara West and Lohara Extension coal block but in June 2007 itself a written communication was already sent to MOC by Govt. of Maharashtra wherein the name of M/s Adani Power ltd. was recommended for Lohara West and Lohara Extension coal blocks alongwith that of other applicant companies.
401. In cross-examination on behalf of accused public servants, a letter dated 15.06.2007 [at page 177-178 in D-24] written by the witness was exhibited as Ex. PW 13/DX-1 and vide said letter addressed to Secy. (Coal) recommendation of Govt. of Maharashtra for Lohara West and Lohara Extension coal block was sent to MOC in favour of various companies as mentioned therein including M/s Adani Power Maharashtra Pvt. Ltd.
402. A letter dated 02.08.2007 written by accused K.C. Samria, Deputy Secretary MOC to Chief Secretary, Govt. of Maharashtra seeking verification of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 146 of 405 status of preparedness of different applicant companies on a number of factors [available at page 164 in MOC file (D-23)] was exhibited as Ex. PW 13/DX-2.
403. Another letter dated 10.08.2007 written by accused K.C. Samria, Deputy Secretary, MOC addressed to Chief Secretary Govt. of Maharashtra where the reminder was issued regarding information earlier sought qua letter dated 02.08.2007 Ex. PW 13/DX-2 [available at page 207 in MOC file (D-23)] was exhibited as Ex. PW 13/DX-3.
404. A letter dated 14.08.2007 addressed to Deputy Secretary MOC signed by Sh. R.D. Mande, Officer on Special Duty (Mining Govt. of Maharashtra) [available at page 56 in MOC file (D-28)] was exhibited as Ex. PW 13/DX-4 (colly).
405. Another letter dated 17.08.2007 addressed to Deputy Secretary MOC signed by Sh. R.D. Mande, OSD (Mining), Govt. of Maharashtra [available at page 9-11 in MOC file (D-28)] was exhibited as Ex. PW 13/DX-5 (colly).
406. A letter dated 06/08.09.2007 signed by Sh. V.S. Rana, Under Secretary Govt. of India addressed to Chief Secretary Govt. of Maharashtra wherein the scheduled time of the meeting was mentioned as 2:30 pm on CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 147 of 405 13.09.2007 [available from page 62-63 in MOC file (D-25)] was exhibited as Ex. PW 13/DX-6.
407. Statement u/s 161 Cr.PC dated 04.02.2013 of PW-13 is Ex. PW 13/DX-7.
408. He had stated in his statement u/s 161 Cr.PC dated 04.02.2013 to the IO that during the meeting which started about 2 to 2.15 PM, the MOC officials mentioned about the blocks under consideration and that the financial diligence of applicant companies had been independently done with the help of financial experts from Coal India Ltd. (CIL).
409. It has come that he left the meeting hall at about 3 PM or so. He attended the meeting for about 30-45 minutes.
410. He denied the suggestion that discussion about Lohara West and Extension coal block and all other coal blocks took place in his presence in the Screening Committee meeting or that thereafter only when the final decision of the Screening Committee was arrived at that he signed the recommendation sheet Ex. PW 13/D (colly) (D-25).
411. He denied that in the meeting held on 13.09.2007 report of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 148 of 405 financial strength of applicant company prepared by experts of CIL or that the status of preparedness of end use project by the applicant companies was put up before the members of Screening Committee in the form of a composite statement.
412. In cross-examination on behalf of A-1 to A-4, he admitted various suggestions such as that the end use plant of M/s JLD was proposed to be established in Yavatmal District, Vidharba region; that Yavatmal District was a backward district of Maharashtra; that establishment of proposed end use plant would have contributed to the economical development of the region.
413. He also told that initially recommendation was made qua Lohara West Coal Block in favour of four different companies including one in the month of May 2007 when a specific recommendation in favour M/s JLD was sent but subsequently in the month of June 2007 as per the policy of State Govt. to make recommendation in favour of all companies who were investing or proposing to invest in the State so names of five more companies were also recommended by Govt. of Maharashtra for Lohara West & Lohara Extension Coal Block. However, after June 2007 till September 2007 the State Govt. was of the view that allocation of Lohara West & Lohara Extension Coal Block will be more suitable for Adani Power Limited as the company had taken effective CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 149 of 405 steps in the State and their end use project was also located in a backward district of the State i.e. "Gondia".
414. He told that no file was prepared in Govt. of Maharashtra wherein any processing or any opinion was expressed at any level whatsoever that it will be more appropriate that Lohara West Coal Block is allocated to M/s Adani Power Limited. He admitted that Lohara West and Lohara Extension Coal Block was situated more closer to Yavatmal District as compared to Gondia District. FROM GOVT. OF WEST BENGAL
415. PW - 24 is Sh. Bhaskar Khulbe. During the year 2007-08, he was posted as Advisor (Industry) Govt. of West Bengal at New Delhi.
416. He deposed that the State Govts. where coal blocks were situated or the end use projects were proposed to be established were members of Screening Committee as was constituted by MoC to make recommendations qua allocation of coal blocks in favour of various applicant companies.
417. He deposed that applications which either pertained to coal blocks situated in the State of West Bengal or where the proposed end use project was to be established in the State of West Bengal, the same were sent by MoC to CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 150 of 405 Govt. of West Bengal for its comments/views.
418. The Department of Commerce and Industries, Govt. of West Bengal had examined the said applications so received from MoC. A Committee headed by him was constituted to make recommendations in favour of various applicant companies. In the 35th Screening Committee of MoC which was dealing with coal blocks reserved for Power Sector, only one coal block namely "Gourangdih ABC" situated in West Bengal was under consideration.
419. He told that the Committee headed by him had made its recommendations in favour of certain applicant companies qua Gourangdih ABC coal block to State Govt. of West Bengal.
420. He told that he had attended some of the meetings of the 35th Screening Committee. He identified his signature on the attendance sheets.
421. Upon being asked as to whether any document was provided to the Members in the said Screening Committee meeting, the witness stated that in the meeting held on 30.07.2007 one consolidated chart containing recommendations of all State Govt. qua various coal blocks under consideration was provided to all the Members of the Screening Committee but no document was supplied to the members in the meeting held on 13.09.2007. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 151 of 405
422. The final decision about recommendations qua various coal blocks in favour of different applicant companies was taken by 35 th Screening Committee in the meeting held on 13.09.2007.
423. Upon being asked as to how the suitability of any given coal block for any specific end use project of any given applicant company was decided, the witness stated that after the State Govt. representative put forth their views or the representatives of Administrative Ministries used to put forth their views then the Chairman used to decide as to which coal block be recommended for allocation in favour of which applicant company. No document regarding suitability of any given coal block for any specific end use project of any given applicant company was supplied to them in the meeting.
424. Upon being asked as to whether any document so as to assess the Techno-Economic Feasibility of any given applicant company was provided to the Members of Screening Committee, the witness replied in negative. The issue of Techno-Economic Feasibility of any given applicant company was not discussed in the meeting.
425. He deposed that no discussion was even held in the meeting as regard the past track record of the applicant companies in execution of the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 152 of 405 projects or as regard the financial and technical capabilities of the applicant companies and also no document in this regard was supplied to the Members of Screening Committee.
426. He stated that the recommendations made by the Administrative Ministries qua various applicant companies i.e. of Ministry of Power was however not supplied to the Members of Screening Committee. No discussion with respect to the recommendations of Ministry of Power however took place in the Screening Committee meeting.
427. Upon being asked as to how the inter se priority was discussed in the final Screening Committee meeting, the witness replied in negative and stated that no such discussion took place in the said meeting. Even no document with respect to the inter se priority or merit or data of the applicant companies was provided to the Members in the meeting.
428. Upon being asked as to what was the methodology or system adopted in the Screening Committee meeting held on 13.09.2007 from which it could be ascertained as to which of the applicant company was better placed than the others, the witness stated that no such methodology or system or means was provided from which it could be ascertained as to which of the applicant CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 153 of 405 company was better placed than the others.
429. Upon being asked as to who had the final say as to which coal block be recommended in favour of which applicant company in the Screening Committee meeting, the witness stated that the Chairman was having the final say.
430. Upon being asked as to whether the decisions arrived at by 35 th Screening Committee could be termed as "unanimous" or by "consensus" the witness replied in negative and stated that the said decisions of 35 th Screening Committee cannot be termed as "unanimous" or by "consensus".
431. After the meeting held on 13.09.2007 was over then each Member of the Screening Committee present were asked to sign the recommendation sheets even if the coal blocks mentioned over there did not pertain to the State to which the said member was representing. The said recommendation sheets were prepared in the meeting itself. The minutes were however not prepared in the meeting. The said minutes were however subsequently downloaded by us in Govt. of West Bengal from the website of MoC but were otherwise not received from MoC. No draft of the said minutes for confirmation was received in Govt. of West Bengal prior to approval of said minutes in MoC. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 154 of 405
432. He was shown the minutes of 35 th Screening Committee meeting Ex. PW 14/H-2 (colly) (jointly of all the meetings of 35 th Screening Committee as are available from pg. 1-41 in MoC file Ex. PW 14/H (colly) (D-25), and was asked as to whether the following facts mentioned in para 9, 10 and 13 of the minutes of 35th Screening Committee meeting held on 13.09.2007 were correct.
9. The next meeting of the Screening Committee was convened on 13.09.2007. The verification reports from most of the State Govts., as requested, were received. The information received was compiled and placed before the Screening Committee. Financial strength of applicant companies was scrutinized independently with the help of financial experts from CIL.
10. Based on the data furnished by the applicants, and the feedback received from the State Govts. and the Ministry of Power, the Committee assessed the applications having regard to matters such as techno-economic feasibility of end-use projects, status of preparedness to set up the end-use project, past track record in execution of projects, financial and technical capabilities of applicant companies, recommendations of the State Govts. and the Administrative Ministry concerned etc. Taking cognisance of the advice given by the Ministry of Power that in view of the capacity constraints in transmission network, plant capacity should be limited to 500-1000 MW, the Committee agreed that this should be taken as the guiding principle. Therefore, 1000 MW would be taken as the maximum limit for allocation of coal blocks, in case the capacity indicated in the application is higher than that. In view of the large number of applications and limited number of coal blocks on offer, the Committee felt that it would be reasonable to have a satisfaction level in the range of around 40-70%, to the extent feasible.
13.The Screening Committee, thereafter, deliberated at length over the information furnished by the applicant companies in the application forms, during the presentation and subsequently. The Committee also took into consideration the views/comments of the Ministry of Power, Ministry of Steel, State Govts. concerned, guidelines laid down for allocation of coal blocks, and other factors as mentioned in paragraph 10 above. The Screening Committee, accordingly, decided to recommend for allocation of coal blocks in the manner as follows:
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 155 of 405 Name of Block Recommended Companies End Use Plant 1 .... .... ....
2 .... .... ....
3 .... .... ....
4 .... .... ....
5 .... .... ....
6 .... .... ....
7 .... .... ....
8 .... .... ....
9 .... .... ....
10 .... .... ....
11 .... .... ....
12 .... .... ....
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14 .... .... ....
15 Gourangdih ABC 1. M/s Himachal Emta Power Ltd. and M/s JSW Steel Ltd. on equal share basis.
2. Representative from the West Bengal Govt.
suggested that either the block be allotted to WBMDTC Bengal or else, be left unallotted. The committee felt that since WBMTDC Bengal had not applied for the block, it would not be possible to consider them. Regarding non-allotment, the matter may be placed for consideration of the Govt.
433. Witness after reading the facts mentioned in para 9 as above stated that no verification report received from State Govt. was placed before the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 156 of 405 Screening Committee Members. Also no report regarding financial strength of applicant companies as is stated to have been scrutinized independently with the help of financial experts from CIL was placed before the Screening Committee Members. Witness stated that a compilation chart containing the recommendations of State Govts. was given but no verification report of State Govts. was given and even the said compilation chart was given in the meeting held on 30.07.2007.
434. As regard the facts mentioned in para 10 witness stated that the facts mentioned in the said para that the Committee assessed the applications having regard to matters such as techno-economic feasibility of end use project, status of preparedness to set up the end use project, past track record in execution of projects, financial and technical capabilities of applicant companies are not correct as no such factors were assessed.
435. As regard the facts mentioned in para 13 witness stated that fact mentioned over there that the Screening Committee deliberated at length over the information furnished by the applicant companies in the application form during the presentation and subsequently is also not correct.
436. Upon being asked as to whose duty was it to check the applications CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 157 of 405 in terms of the guidelines issued by MoC governing allocation of captive coal blocks qua the eligibility and completeness of the applications, the witness stated that it was the duty of MoC to first check the applications and thereafter send them to the State Govts. or Administrative Ministries.
437. He deposed that MoC officials did not inform that the applications had not been checked for their eligibility and completeness. He stated that he played no role with respect to recommendation in favour of M/s JLD Yavatmal Energy Ltd qua allocation of Fatehpur East Coal Block.
438. He corroborated the fact that Sh. V.K. Jairath was in urgency to return to Mumbai on 13.09.2007 and thus requested the Screening Committee to take up the matter relating to Maharashtra Govt. in the beginning and which request of his was duly acceded to by the Chairman. Accordingly the matter relating to Maharashtra was taken up in the first and soon thereafter he left the meeting.
439. In cross-examination, he was confronted with his statement u/s 161 Cr.PC dated 07.02.2013 which is Ex. PW 24/DX-1.
440. In cross-examination on behalf of accused public servants, Office Order dt. 05.07.2006 issued in file bearing no. 247-CI/O/Coal/001/03/M-1 CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 158 of 405 [available at page 10 in the file bearing No. A(1)/III/9/WBIDC-06 of the Office of Advisor (Industry) i.e. MR No. 3768/16 and as brought by Constable Laxminarain, Assistant Incharge Malkhana, EO-I, CBI] vide which a committee was initially constituted and at that time Sh. Hem Pande was appointed as Chairman of the Committee was exhibited as Ex. PW 24/DX-2.
441. Similarly Order dt. 03.05.2007 issued in file no. 10014- CI/O/Coal/13/06/M-1 (Pt-II) [available at page 85 in the file bearing No. A(1)/III/9/WBIDC-06 of the Office of Advisor (Industry) i.e. MR No. 3768/16 and as brought by Constable Laxminarain, Assistant Incharge Malkhana, EO-I, CBI] vide which the Committee headed by him was constituted is Ex. PW 24/DX-3.
442. A DO communication dt. 24.05.2007 addressed to Smt. Roshni Sen, Joint Secretary, C&I Department and who was also the Convener of the internal committee headed by him [available at pg. 91 in the file of office of Advisor (Industry) Govt. of West Bengal] Ex. PW 24/DX-4. [available at page 91 in the file bearing No. A(1)/III/9/WBIDC-06 of the Office of Advisor (Industry) i.e. MR No. 3768/16 and as brought by Constable Laxminarain, Assistant Incharge Malkhana, EO-I, CBI] CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 159 of 405
443. The minutes of the meeting dt. 14.06.2007 held by him are Ex. PW 24/DX-5. Some handwritten notes at pg. no. 69 in a file bearing no. A(I)/III/9/WBIDC-06 (MR No. 3768/16) in his handwriting are Ex. PW 24/DX-6.
444. In letter dt. 24.05.2007 Ex. PW 24/DX-4 written by him to Ms. Roshni Sen, he had stated pursuant to discussion held by him with Sh. K.S. Kropha, the following facts:
"Expectedly, Shri Kropha believes that the State Committee would follow Ministry of Coal guidelines & conditions (copy downloaded from Ministry website enclosed) for allocation of coal blocks to enable harmonious observance of norms, especially in view of large number of applications received this year. He indicated that until the Committee decides to change the procedure, the convention of personal interaction with the applicants is likely to be continued. Informally, his suggestion was that the State committee need not resort to such interaction, lest it raises expectation levels unnecessarily. I think vast number of applications with us would also preclude such possibility."
445. One letter dt. 04.06.2007 at pg. no. 92 in a file bearing no. A(I)/III/9/WBIDC-06 (MR No. 3768/16) written by him to Ms. Roshni Sen is Ex. PW 24/DX-7. One document at pg. no. 158-156 in the said file titled "Suggested Modalities for recommendation to allocate Coal Blocks" is Ex. PW 24/DX-8. One document at pg. no. 155-111 in the said file titled "particulars of applications furnished by the MoC, Govt. of India for allocation of coal CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 160 of 405 blocks in response to advertisement published through Newspaper" is Ex. PW 24/DX-9. A letter dt. 11.06.2007 at pg. no. 96 in the file written by him to Smt. Roshni Sen is Ex. PW 24/DX-10.
446. He admitted the suggestion that it was not prudent to put any specific weightage to any of the nine factors as were mentioned in the guidelines issued by MoC for arriving at the inter se priority and decision in this regard was to be taken in a holistic manner by reconciling the views of the various members of the committee which ensured that all the factors are duly considered while making the recommendations.
447. He admitted that the role of Chairman in a meeting is two fold i.e. to conduct a meeting in an orderly fashion so that everyone present may express their views and towards the end the chairman sums up the essence of the discussion which was held in the meeting and thereby to arrive at a decision. He further admitted that summing up of discussion in a meeting done by the chairman is undertaken by way of reconciling the views expressed by various members of the committee. He also admitted that if any member in a meeting does not agree with the said summing up of the discussion by the chairman then he can get his dissent recorded.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 161 of 405
448. He also acknowledged that if no member gets his dissent recorded then the decision arrived at in the meeting shall be considered as decision taken in the meeting by unanimity or by broad consensus.
449. He also admitted that no such reasons were mentioned in the minutes as the committee was only asked to give its recommendations and not to give a report thereof and had it been a report then the same would have contained the reasons and the views expressed by various members for arriving at any particular recommendation.
450. A communication dt. 13.09.2007 at pg. no. 349 in the file bearing no. A(I)/III/9/WBIDC-06 (MR No. 3768/16) which was sent to Dr. Sabyasachi Sen, Principal Secretary, C&I Department, Govt. of West Bengal by the witness under his own signatures after the final meeting of 35 th Screening Committee meeting is Ex. PW 24/DX-11.
451. He admitted that in the said communication he had written that recommendations in respect of other states (Orissa, Jharkhand, Maharashtra and Chhatisgarh) were finalised by reconciling between the states' evaluation, power Ministry opinion and the criteria suggested by the Chairman.
452. Another communication dt. 03.08.2007 at pg. no. 212-211 in a file CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 162 of 405 bearing no. A(I)/III/9/WBIDC-06 (MR No. 3768/16) is Ex. PW 24/DX-12 which was also sent to Dr. Sabyasachi Sen, Principal Secretary, C&I Department, Govt. of West Bengal by the witness under his own signatures and admitted that it is clear that the recommendations as were made by CEA and were endorsed by the Power Ministry were circulated and deliberated upon in the meeting.
FROM COAL INDIA LTD.
453. PW-12 Sushmita Sengupta was posted as Manager (Finance) CIL, Kolkata in August, 2007. She is Cost Accountant by qualification.
454. As Manager (Finance) CIL, she was working in Finance Department looking after the foreign exchange risk management.
455. She deposed that before 07.08.2007, the then Director Finance, CIL namely Sh. Shayamal Bhattacharya, told her and one Mr. Samiran Dutta who was working as Manager Finance CIL to go to MoC Office, Shastri Bhawan, New Delhi and report to Joint Secy. (Coal) Sh. K.S. Kropha. The aforesaid instructions were given to them verbally.
456. Accordingly, she along with Sh. Samiran Dutta came to MoC Office, New Delhi 07.08.2007 and met Sh. K.S. Kropha, Jt. Secy. (Coal) at his CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 163 of 405 office at Shastri Bhawan.
457. She deposed that after they met Sh. K.S. Kropha, then he called Director Coal Sh. K.C. Samria to his office and, thereafter, Sh. K.S. Kropha told them that they had to cross-check the networth of certain companies from the balance sheets of said companies. They also gave them a spread sheet wherein the names of various companies were already mentioned along with their corresponding networth mentioned across their names. They were thus asked to cross-check the networth of the said companies as mentioned in the spread sheets viz a viz their respective balance sheets.
458. She deposed that there were about 150 companies or so whose names were mentioned in the spread sheets. The aforesaid work was carried out by them in about four days and they used to work till late in the evening as the work assigned to them was voluminous in nature.
459. She further deposed that in order to cross-check the networth of various companies as mentioned above, they used to check the balance sheets as were made available to them by the MoC officials and if the name of the company mentioned in the spread sheets tallied with the name mentioned in the balance sheets provided to them then the networth used to be calculated by them CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 164 of 405 from the balance sheets as appeared on the face of said balance sheets and if the said figure also tallied with the one mentioned in the spread sheet then in the spread sheet against the name of said company they used to mention "OK" and in those cases where the networth so calculated from the balance sheets did not tally with the one mentioned in the spread sheet then they used to mention the words "Not OK" against the name of the said company in the spread sheet. Moreover, in respect of those companies whose names did not tally with the balance sheets provided to them then in the spread sheet against the name of the said company they used to mention the words "Balance Sheet not available".
460. However in some of the cases some certificates issued by Chartered Accountants certifying the networth of the given company used to be provided to them then in those cases they did not accept any such certificates issued by Chartered Accountants and against the name of the said companies as mentioned in the spread sheet we mentioned the words "Balance Sheet not available".
461. She deposed that they considered and accepted only those balance sheets which were signed by the Directors, Chairman and Auditor of the company. They however did not check or scrutinize the financial strength of the applicant companies. Even no instructions in this regard was given to them by CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 165 of 405 MoC.
462. Whatever remarks were given by them were mentioned by them in the spread sheets made available to them by typing the relevant remarks on an electronic type writer made available to them by Delhi office of CIL along with a typist. No separate report regarding the work done by them was prepared.
463. She deposed that they only checked the networth of any given company from the balance sheets as were made available to them and no other record was given to them from which it could be seen as to whether any given company was a Special Purpose Vehicle (SPV) or a Joint Venture (JV) Company. In order to ascertain the aforesaid status of any given applicant company one needs to see as to whether any MOU or JV or SPV agreement had been entered into between more than one entity or not.
464. She further deposed that upon completion of their work they went to MoC office and met Mr. K.S. Kropha and handed over to him the spread sheets containing their remarks as above. Sh. Kropha thereafter asked them to maintain confidentiality about the work so undertaken by them and to also destroy the rough papers, if any, as might have been used by them while undertaking the aforesaid work. At that time, Sh. K.C. Samria was also present CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 166 of 405 alongwith Sh. K.S. Kropha. Thereafter, they went back to their office at Kolkata. However, after returning back to their office, they did not submit any report at their office at Kolkata regarding the work undertaken by them in Delhi.
465. She deposed that the application of M/s JLD Yavatmal Energy Limited Ex. PW 1/B (D-3) was shown to her by the IO.
466. The witness was asked as to if the net worth of M/s JLD Yavatmal Energy Limited, Lokmat Group and that of IDFC as mentioned in point 6 of the application was to be ascertained then what all documents would be required. Witness stated that while the net worth of any company including applicant company can be ascertained from the balance sheet of the said company but in case of a JV company or a SPV the MOU or JV/SPV agreement also needs to be seen.
467. In cross-examination on behalf of A-1, she stated that letter dated 02.08.2007 signed by Sh. K.C. Samria in Ministry of Coal file (D-23) wherein a request was made to Chairman CIL for deputing two financial experts for scrutinizing financial details of applicants was not seen by her. The letter is Ex. PW 12/DX-1.
468. She denied that when she and Samiran Dutta had met Sh. Kropha CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 167 of 405 and Sh. Samria at MOC office Shastri Bhawan then they also told them that they had to scrutinize the financial details of applicants for coal blocks earmarked for allocation through the Screening Committee and that they would be required to verify the financial details of each application based on supporting documents submitted by the applicant companies.
469. She was confronted with her statement u/s 161 Cr.PC dated 25.09.2012 Ex. PW 12/DX-2 wherein the fact that she had not seen application of JLD was not mentioned.
470. In cross-examination on behalf of public servant accused, she admitted that while putting out remarks they mentioned the words "Balance sheet not available" qua those companies whose balance sheets were not available and the words "not OK" were mentioned qua the companies whose net-worth figure did not tally with the net-worth figures mentioned in the spread sheets.
471. She explained the meaning of term "Financial Strength" of a company as the profitability of the company, Debt-Equity ratio, Future Cash Flow, Contingent Liability or any Agreement entered into by the company creating any liability upon it etc. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 168 of 405
472. She told that they were only asked to cross-check the net-worth and not the financial strength.
FROM OFFICE OF COAL CONTROLLER, KOLKATA
473. PW-10 Sh. Chandan Bandopadhyay is from the office of Coal Controller at Kolkatta. He deposed that in the month of July 2007, on the directions of his senior officers, he along with Sh. Manoj Karmakar, Sh. Debashish Dass and Sh. Sumanto Bishwas had come to the MoC Office, New Delhi, Shastri Bhawan. They had reported at Shastri Bhawan office on 11th or 12th July, 2007. At Shastri Bhawan they all met Sh. R.N. Singh Section Officer CA-I Section MoC. Sh. R.N. Singh told them that as number of applications had been received seeking allocation of captive coal block they had to sort them out at Scope Minar at Laxmi Nagar.
474. After reaching Scope Minar Laxmi Nagar office they found a large number of applications lying in a room. Along with applications there were number of enclosures. As directed they took out the main application form pages of all such applications and arranged them in alphabetical order. Witness further stated that initially all the applications forms were sorted out coal block wise and thereafter qua each coal block they were kept in alphabetical order. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 169 of 405 They did not do any other work. They also did not check the applications either for their completeness or eligibility.
475. He told that they had thus stayed in Delhi for about 8-10 days in connection with aforesaid work.
476. In cross-examination on behalf of A-5 and A-6, he told that he had no knowledge while carrying out the sorting work as to in what manner any of the said application could be termed as complete or any of the applicant company could be classified as eligible company. He denied the suggestion that they had also checked the total number of enclosures as were available with any of the given application. He denied that Sh. R.N. Singh told them to first check all the applications along with the enclosures thereof before proceeding to sort them out. He also denied that they had not sorted out the applications coal block wise. He was confronted with his statement u/s 161 Cr. PC dated 12.07.2013 Ex. PW 10/DX-1, wherein the aforesaid fact is not mentioned.
477. In cross-examination on behalf of A-1 company, he, after seeing letter dated 20.12.2006 addressed to Coal Controller Kolkatta and written by Sh. V.S. Rana Under Secretary, MoC and as available at page no. 102 in D-30 i.e. a Ministry of Coal stated that t this stage attention of the witness was drawn to CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 170 of 405 file and was asked as to whether pursuant to the said letter he and his colleagues were deputed by his office to Ministry of Coal office, New Delhi. The witness however denied stating that the letter shown to him is dated 20.12.2006, whereas he along with his colleagues had come in July, 2007. The letter as above is Ex. PW 10/DX-2.
478. He deposed that in Delhi he had not met Sh. V.S. Rana. He also did not remember whether he had sorted out any names of applicants which were already fed in the computers. He did not remember whether in his statement Ex. PW 10/DX-I, he had stated to the IO or not that they also sorted the names of the applicants, which were already fed into the computer, sector wise such as power, steel and cement sectors. He was confronted with statement Ex. PW 10/DX-I from portion A to A, where the aforesaid fact was mentioned.
479. He further stated that no check list was given to them when they carried out the sorting work. He volunteered that there was no issue of checking the applications at that time.
480. In cross-examination on behalf of accused K.C. Samaria, he told that when they left office at Kolkatta, they were not given any document mentioning therein the exact scope of work which they had to carry out at CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 171 of 405 Delhi. They were only told that they had to report at Ministry of Coal Office, Shastri Bhawan, New Delhi. At Scope Minar Laxmi Nagar Sh. R.S. Negi was supervising their work. He also told that they were not assisted by any Ministry Coal officer in their aforesaid work except that Sh. R.S. Negi was supervising them and giving necessary directions. He denied the suggestion that Sh. R.S. Negi specifically told them to check the applications for their eligibility and completeness.
481. PW-11 Sh. Kirtan Chandra Modak is also from the Office of the Coal Controller, Kolkata. In January 2007, he was posted as Assistant in MCBA Section in the office of Coal Controller itself. In the first week of January 2007 on the directions of his office, he along with Sh. L. Mallik, Sh. Subhashish Dass and Sh. Aftab Alam had reported at MoC office Shashtri Bhawan, New Delhi.
482. He deposed that after reaching MoC office, they met Sh. V.S. Rana, Under Secretary, MoC. He told them that Sh. R.S. Negi would take them to Laxmi Nagar Scope Minar and there they had to receive the applications being received for allocation of captive coal block. He deposed that they were not told to check the applications.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 172 of 405
483. They were told that when the applications would be presented to them then they need to see the name of the coal block applied for and also whether the demand draft of Rs. 10,000/- was available with the application or not. In case the draft of Rs. 10,000/- was not available then the application was not to be received. After receiving the applications they were to make entry in the registers available over there.
484. At this stage upon being shown copy of a register as available in D- 5 witness stated that entries of applications so received by them were made in such registers only. Witness had identified the said register to be the one in which the entry of application was made by him and his colleagues. Witness however expressed his inability to state as to in whose hand entry no. 235 to 239 relating to M/s JLD Yavatmal Energy Limited had been made. The copy of the register is Ex. PW 11/A (D-5)
485. He deposed that they had stayed at Delhi for about 8-10 days and then returned back to their office at Kolkatta.
486. He deposed that again in the month of June, 2007 he along with Sh. Partho Bandopadhaya had again come to MoC office, Shashtri Bhawan. Again they reported to Sh. V.S. Rana, MoC. On this occasion Sh. V.S. Rana told them CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 173 of 405 that Sh. R.S. Negi would take them to Scope Minar Laxmi Nagar office and that they had to sort out the applications block wise. They found the applications lying scattered over there. They accordingly sorted out the applications block wise. On this occasion they stayed for about 7-8 days and thereafter went back to their office at Kolkatta.
487. Again in the month of August, 2007 he along with Sh. Partho Bandopadhaya, Sh. Debashis Dass and Sh. Sumanta Bishwas were again deputed to MoC office, New Delhi. After reaching MoC office we again reported to Sh. V.S. Rana. On this occasion Sh. V.S. Rana told them that Sh. R.S. Negi would take them to Scope Minar Laxmi Nagar office and they were told to flag the balance sheets in the various applications as were lying over there. They carried out the aforesaid work and stayed in Delhi for about 7-8 days and thereafter went back to their office at Kolkatta.
488. He was cross-examined on behalf of A-1 but nothing substantial has come.
489. In cross-examination on behalf of A-5 and A-6, he was confronted with his statement u/s 161 Cr.PC dated 11.07.2013 which is Ex. PW 11/DX-1.
490. He denied that he had introduced the factum of meeting with V.S. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 174 of 405 Rana at MoC office Shastri Bhawan at the instance of CBI.
491. He was also cross-examined on behalf of A-7. Nothing substantial has come up in cross-examination.
492. PW-15 is Sh. R.K. Sutradhar. He is also from Office of Coal Controller Kolkata. On 14.01.2015 he had produced certain documents to CBI as were demanded by them. He proved the production cum receipt memo dated 14.01.15 [as available in D-40] vide which he had handed over the documents to Dy.SP Himanshu Bahuguna. The memo is Ex.PW15/A (D-40). He identified the documents also i.e. as available in D-41, D-42, D-43 and D-44. The status report filed vide letter dated 02.10.07 of Mr. Shekhar Berde Sr. Manager, Abhijeet Infrastructure Ltd. for the quarter ending September 2007 with respect to "Brinda", "Sisai" and "Meral" coal blocks is Ex.PW15/B (colly)(D-41). (There was objection as to mode of proof but the same is dismissed as it was received in the office of Coal Controller).
493. The status report vide letter dated 11.07.07 of Mr. Shekhar Berde Sr. Manager, Abhijeet Infrastructure Ltd. for the quarter ending June 2007 with respect to "Brinda", "Sisai" and "Meral" coal blocks is Ex.PW15/C (colly)(D-
42). (There was objection as to mode of proof but the same is dismissed as it CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 175 of 405 was received in the office of Coal Controller).
494. The status report vide letter dated 13.07.07 of Dr. V.S. Garg, Director, Corporate Ispat Alloys Ltd. for the quarter ending 31.06.2007 with respect to"Chitarpur" coal block is Ex.PW1/D (colly)(D-43).
495. The status report vide letter dated 02.10.07 of Dr. V.S. Garg, Director, corporate Ispat Alloys Ltd. for the quarter ending 30.09.2007 with respect to"Chitarpur" is Ex.PW1/E (colly)(D-44).
496. Upon being asked as to whether the two companies i.e. Abhijeet Infrastructure Ltd. and Corporate Ispat Alloys Ltd. had achieved all the milestones towards mining of coal blocks allotted to it by MoC, witness stated that at the time of issuance of allocation letter of a coal block in favour of any company the MoC lays down various milestones which are to be achieved by the allocatee company. However as is evident from the aforesaid status reports filed by the two companies themselves in the office of Coal Controller, Kolkata some of the milestones whose scheduled date of completion is mentioned in the status report by the company itself were not achieved. The company had also mentioned in the said status report the date of completion of some of said milestones but no remarks at all have been mentioned by the companies in the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 176 of 405 column titled "reasons for delays", in achieving the said milestones. However certain remarks are mentioned by the company in column no. 6 of the said status reports titled "feedback". He deposed that as per the said status report filed by the two companies themselves the various milestones laid down by MoC were not achieved by them either on time or were not at all achieved till the date of filing of said respective status reports.
497. He was cross-examined on behalf of A-1 to A-4. He told that he was not posted in the office of Coal Controller Kolkata in the year 2007 and thus none of the aforesaid status reports were filed by the two companies in the office of Coal Controller, Kolkata in his presence.
498. He admitted that if any allocatee company failed to achieve the stipulated milestones then the MoC could forfeit the bank guarantees submitted by the allocatee company at the time of allocation. He was not aware as to whether bank guarantees furnished by the two companies were forfeited by MoC or not.
INDEPENDENT WITNESS OF SEARCH & SEIZURE
499. PW-9 Aman Shrawan Sontakke had joined search proceedings on instructions from his office on 04.09.2012. Sh. Kishor Padade, a colleague of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 177 of 405 his working in GSI Nagpur also accompanied him.
500. They alongwith two constables and one officer of CBI sat in a vehicle and went to Ring Road, Trimurti Nagar. Over there they reached at the office of one company M/s JLD Energy Ltd. The office was locked but was opened later by someone. The CBI officers checked the entire office and asked for various files which were produced before them by the said person. The CBI officer also showed them the files and while returning back some of the files which they did not find to be of any use to them, they retained some of the files.
501. A report was prepared by the CBI officer and on which he and Mr. Padade signed. The said person who had come from the company also signed the said report. He and Mr. Padade also signed on the said files.
502. He identified his signatures on search list dated 04.09.2012 [as available in D-15]. The search list is Ex. PW 9/A. He identified his signatures/initials on each page of file Ex. PW 3/E (Colly).
503. He further identified his signatures on the search warrant dated 04.09.2012 which is Ex. PW9/B.
504. Nothing has come out in cross-examination.
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505. PW 16 is Sh. S.P. Rana, Dy. SP. He had filed his affidavit towards examination-in-chief u/s 296 Cr. PC which is dated 15.03.2018 and is Ex. PW 16/A.
506. He deposed that a preliminary enquiry bearing No. 219 2012 E 0002 after being registered by CBI with respect to coal block allocation matters was entrusted to him for enquiry by orders of Sh. Ravi Kant, the then SP, EO-I, CBI. The said enquiry remained with him as inquiry officer from 01.06.2012 till 06.08.2012. However, thereafter the said enquiry was entrusted to SP Sh. Vivek Dutt by the orders of senior officers. He remained associated thereafter with the said enquiry under Sh. Vivek Dutt till September 2012.
507. He deposed about sending certain requisition letters to MoC and other departments for collection of various documents pertaining to coal block allocation matters. Subsequently, vide various production-cum-receipt memos/handingover-cum-receipt memos, he had collected number of documents from MoC and Ministry of Power etc.
508. Vide production-cum-receipt memo dated 02.06.2012, 08.06.2012 (Handing over-cum-receipt memo) and 18.06.2012, he had collected various CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 179 of 405 documents/files of MoC from Sh. V.P. Sharma, the then Section Officer, CA-I Section in the presence of public independent witnesses.
509. Vide production-cum-receipt memo dated 06.06.2012(Handing over-cum-receipt memo), 30.06.2012, and 06.07.2012, he had collected various documents/files of MoC from Sh. Ram Naresh, the then Section Officer, CA-I Section in the presence of public independent witnesses.
510. Vide production-cum-receipt memo dated 27.07.2012, of Ministry of Power, he had collected various documents/files of MoC from Sh. Sampat Narain, the then Under Secretary, Ministry of Power in the presence of public independent witness.
511. All the aforesaid memos bear his signatures. The copies of memos dated 02.06.2012, 06.06.2012, 08.06.2012, 30.06.2012, 18.06.2012, 06.07.2012 and 27.07.2012 are respectively Ex. PW 16/B, EX. PW 16/C, Ex. PW 16/D, Ex. PW 16/E, Ex. PW 16/F, Ex. PW 16/G and Ex. PW 16/H.
512. The relevant documents were also exhibited during his evidence.
513. He identified the documents i.e. copy of file of MoC bearing No. 38011/1/2007-CA-I (Vol. II) Ex. PW 14/E (Colly) as is available in D-23, copy CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 180 of 405 of file of MoC bearing No. 38011/1/2007-CA-I (Vol. I) Ex. PW 14/D (Colly) as is available in D-24, copy of file of MoC bearing No. 38011/1/2007-CA-I (Vol. III) Ex. PW 14/H (Colly) as is available in D-25, copy of file of MoC bearing No. 38011/1/2007-CA-I (Vol. IV) Ex. PW 14/J (Colly) as is available in D-54, copy of file of MoC bearing No. 38011/1/2007-CA-I (Vol. V) Ex. PW 14/K (Colly) as is available in D-26, copy of file of MoC bearing No. 38011/1/2007- CA-I (Vol. VI) Ex. PW 14/F (Colly) as is available in D-27, copy of file of MoC bearing No. 38011/1/2007-CA-I (Vol. VII) Ex. PW 14/G (Colly) as is available in D-28 stating that the original files were seized by him vide memo dated 02.06.2012 Ex. PW 16/B and are mentioned at S. No. 11-17 of the memo.
514. He identified original file titled "Agenda for 35 th Screening Committee meeting for Power Sector to be held from 20.06.2007 to 23.06.2007 FATEHPUR EAST" coal block as is available in D-34 and stated that the said file was seized by him vide memo dated 06.06.2012 Ex. PW 16/C and is mentioned at serial No. 15 of the memo. The file is Ex. PW 16/J (Colly) (D-
34). (There was objection as to mode of proof but the same is overruled as it was original document and it was exhibited only for identification.).
515. He deposed about collecting D-38 containing forms for feed back of various companies including the form for feedback Ex. PW 3/J-1 as is CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 181 of 405 available in the said document of JLD Yavatmal Energy Ltd. was collected by him vide memo dated 08.06.2012 Ex. PW 16/D.
516. He identified copy of a file bearing no. 13016/65/2006-CA-1 (Vol. I) Ex. PW 14/A (Colly) of MoC [as is available in D-30] and stated it to be copy of one of the file seized by him vide memo Ex. PW 16/E dated 18.06.2012 and is mentioned at serial no. 10 of the memo.
517. He also identified copy of a file bearing no. 13016/65/2006-CA-1 (Vol. II) of MoC as is available in D-52 seized by him vide memo Ex. PW 16/E dated 18.06.2012 and is mentioned at serial no. 11 of the memo.
518. The copy of file is Ex. PW 16/K (Colly). (Objection as to mode of proof is overruled for the aforesaid reason).
519. He similarly identified various other documents such as Ex. PW 16/L [available in D-3], Ex. PW 11/A [available in D-5], Ex. PW 16/M-1 [ available in D-53] and Ex. PW 16/M-2 (Colly) [available in D-32]. (There was objection as to mode of proof but the same is dismissed.)
520. He deposed that he deposited the aforesaid documents in the Malkhana along with the seizure memos.
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521. He deposed about collecting two documents vide seizure memo dated 05.09.2012 (when the present case was under investigation and investigation was being conducted by Inspector Sanjay Sehgal) on the directions of HOB Sh. Ravi Kant DIG CBI. He had gone to the office of IDFC Ltd, Naman Chambers, Mumbai and had collected the following two documents . (1) Memorandum of Understanding dtd. 27.12.06 between M/s Abhijeet Infrastructure Ltd, M/s Lokmat Newspapers Pvt. Ltd. and M/s Infrastructure Development Finance Company Limited containing sheets 1 to 16. (already exhibited as Ex. PW 6/C) (2) Letter dtd. 26.6.07 of Mr. Sachin Johri, IDFC Ltd. addressed to Mr. Sanjay Dey, M/s Abhijeet Infrastructure Ltd and Mr. Rishi Darda, M/s Lokmat Newspapers Pvt. Ltd in respect of extension of term of MOU dtd. 27.12.06-1 sheet. (already exhibited as Ex. PW 3/G).
522. In cross-examination, he stated that he had knowledge of CBI Crime Manual. Nothing substantial has come out in cross-examination.
523. PW-20 is IO Dy. SP Himanshu Bahuguna. He deposed that in June 2012, a preliminary enquiry bearing No. 219 2012 E0002 was registered in EO-I branch, CBI regarding coal block allocation matters. He was also CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 183 of 405 associated with the said preliminary enquiry although he was posted in EO-II branch. Dy. SP Sh. SPS Rana was the enquiry officer. Thereafter, in September 2012, three regular cases relating to coal block allocation matters were assigned to him for investigation and case pertaining to M/s JLD Yavatmal Energy Ltd. was one of them. The initial investigation was conducted by Insp. Sanjay Sehgal. The initial IO Insp. Sanjay Sehgal had already conducted search operations at various places and collected/seized various documents.
524. He collected the case diary from Insp. Sanjay Sehgal beside various other documents. He deposed that since a number of coal block allocation matters were being enquired into or investigated by CBI, so a large number of documents which were relevant to various such matters were collected by CBI in original during the course of preliminary enquiry itself. Accordingly, the documents which were specific to the present case were collected in original and other documents which had their application in various other matters also were collected in photocopies. The above documents were collected from malkhana.
525. He told that the investigation of the present case was handed over to him on 19.09.2012 vide order dated 18.09.2012 of Sh. O.P. Ghalotra, the then Head of EO Zone-I. At that time Sh. Ravi Kant the then DIG was the Incharge CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 184 of 405 of EO-I. He identified signatures of Sh. Ravi Kant on copy of RC No. 219 2012 E0010 (available in D-1). The copy of FIR is Mark PW-20/P-1. In the said FIR there were allegations against the company M/s JLD Yavatmal Energy Ltd. and its officers/directors that they had misrepresented before 35 th Screening Committee, MoC with a view to procure allocation of a captive coal block, ie. Fatehpur East coal block in Chhattisgarh. It was also alleged that the misrepresentation made by the company was overlooked by the MoC officers.
526. He deposed that during the course of subsequent investigation, he collected a number of documents from various departments, individuals beside also obtaining explanation of the accused persons and also recorded statements of relevant witnesses.
527. He deposed about collecting various documents as have already been referred to in the evidence of other witnesses.
528. He deposed about communication dated 04.06.2013 of Sh. S.K. Shahi, Director, MoC vide which he had informed Dr. V. Murugesan, Head of Branch, EO-II, about the details of various coal blocks allocated to M/s Abhijeet Infrastructure Ltd., M/s Corporate Ispat Alloys Ltd. and M/s Jayaswal Neco Ltd. The communication dated 04.06.2013 is exhibited as Ex. PW 20/A (D-17). CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 185 of 405
529. He also deposed about copy of a letter dated 03.05.2013, [available in D-18] which was in reply to a query raised by Sh. Ravi Kant DIG about the relevancy of column No. 29 and 30, in the application form prescribed by MoC, seeking information regarding earlier coal blocks allocated to the applicant companies or its group/associated companies, and vide which Sh. S.K. Shahi had informed that from the records available the rationale/logic for keeping column No. 29 and 30 in the application form could not be ascertained. He however further stated that the guidelines for allocation inter-alia provides for the evaluation criterion of technical experience (in terms of existing capacity in coal/lignite mining and specified end use) and track record, which could have possible link to column No. 29 and 30 in the application form. He also enclosed with his letter a copy of the guidelines issued by MoC governing allocation of captive coal blocks. The copy of said letter/office memorandum dated 03.05.2013 is Mark PW20/P-2 (Colly) (D-18).
530. He also referred to copy of office memorandum dt. 02.05.2013 [available in D-19] which was in response to various communications sent by different officers of CBI involved in investigation of various coal block allocation matters seeking information as to whether the applications received for 35th and 36th Screening Committee were checked for their completeness and CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 186 of 405 eligibility in MoC or not, and vide which Sh. S.K. Shahi Director MoC had submitted the following information.
"2. In this regard, it is informed that from the records/documents as available, it is seen that the applications received from the applicant companies for allocation of 38 coal blocks (15 power blocks which were considered in 35th Screening Committee meetings and 23 non- power blocks which were considered in 36th Screening Committee meetings) advertised in November, 2006 do not appear to have been checked for the eligibility and completeness in the Ministry of Coal before sending to administrative Ministries/State Govts. for examination and comments thereon. However, a set of applications received was also sent to CMPDIL, which is a technical organization under CIL, for examination and comments. Further, as per the minutes of 35th Screening Committee, it is seen that it was decided that the State Govts. may be asked to carry out a quick verification of the data used by the Ministry of Power for techno-economic evaluation of end use projects. Minutes further record that the verification reports were received from most of the State Govts.. It also appears from the records that the Screening committee had not entrusted the job of checking of applications to any official.
The Feedback form and presentation made by M/s Kamal Sponge Steel & Power Ltd. Could not be located in the concerned Section in the Ministry No. circulars/office orders/guidelines etc. describing the role of officers/officials of Ministry of Coal during the process of allocation of coal blocks by 35th and 36th Screening Committee were found to have been issued."
531. The copy of office memorandum dt. 02.05.2013 as above is Mark PW 20/P-3.
532. He also deposed that upon completion of aforesaid investigation, the matter was discussed with senior officers and it was decided that as no prosecutable case was made out against any accused person so a Closure CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 187 of 405 Report/Final Report u/s 173 Cr. PC dt. 11.04.2014 was filed in the court. The final report u/s 173 Cr.PC is Ex. PW 20/B.
533. He deposed that subsequent to filing of final report u/s 173 Cr.PC Ex. PW 20/B, Hon'ble Supreme Court constituted a Special Court for trying coal block allocation matters and Ld. Sr. Advocate Sh. R.S. Cheema was appointed as Special P.P. in the matter. Subsequent to his appointment as above the present matter was discussed with Sh. R.S. Cheema and pursuant to which it was decided that a supplementary report u/s 173 Cr.PC may be filed. Accordingly, on16.10.2014 a supplementary final report u/s 173 Cr.PC was filed which is Ex. PW 20/C (colly). He further deposed that subsequent thereto an order 20.11.2014 was passed by this Court whereby it was observed that prima facie case for taking of cognizance of various offence under IPC and under Prevention of Corruption Act was made out and the matter was accordingly sent to CBI with the direction that the record of the case be placed before the Competent Sanctioning Authority for considering the issue of according sanction to prosecute the two serving public servants namely Sh. K.S. Kropha and Sh. K.C. Samria.
534. He deposed that accordingly on 05.01.2015, CBI sent all the relevant record to the competent sanctioning authority for considering according CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 188 of 405 of sanction to prosecute the aforesaid two public servants. Subsequent thereto a status report dated 29.01.2015 was filed by me before this Court informing about the progress made during the further investigation of the matter. The said progress report bears my signatures at point A on the two pages. The progress report of further investigation is Ex. PW 20/D.
535. He told that subsequent thereto no communication was received from the office of Competent authority regarding the decision, if any, taken by it with regard to grant or refusal of sanction to prosecute the two public servants. He accordingly filed the further investigation report dated 21.07.2015 in the court. The further investigation report dated 21.07.2015 is Ex. PW 20/E. Alongwith the said report the documents collected during the course of further investigation were also filed in the court beside filing list of additional witnesses.
536. He deposed that vide communication dated 22.06.2015 available in D-39 Sh. Piyush Goyal, Technical Director, NIC, MoC, had provided print out of the advertisement issued by MoC alongwith format of application form and various other documents as were got uploaded on the website of MoC by Ministry of Coal during the process of allotment of captive coal blocks. Alongwith the said documents he had submitted certificate u/s 65-B Evidence CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 189 of 405 Act, under his signatures.
537. Prosecution had filed affidavidt of Sh. Piyush Goyal. The affidavit dated 07.07.2017 is Ex. PW 20/F (colly). The documents available in D-39 are Ex. PW 20/G (colly) (D-39).
538. He deposed that vide letter dated 23.03.2015 available in D-45, inquiry was made from MoC, as to whether other copies of application of M/s JLD Yavatmal Energy Ltd. for Fatehpur East coal block were available in the Ministry. In response thereto Sh. A. Sanjay Sahay, the then Under Secretary, Govt. of India, responded vide letter dated 23.03.2015 stated that no other such record is available with them and that the said application has already been provided to CBI by MoC, after having received the same from CMPDIL. It was also informed that MoC has already informed CBI that the original application of the company pertaining to the year 2007 is not available in the records of the concerned section in the Ministry. The letter dated 23.03.2015 is Ex. PW 20/H (D-45).
539. Upon being asked as to what was found in the investigation regarding the constitution/formation of the applicant company and who were its directors, the witness after seeing the application Ex. PW 1/B (colly) and its CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 190 of 405 covering letter dated 05.01.2007 Ex. PW 1/A, (both part of D-3), stated that in the covering letter it was stated that the applicant company M/s JLD Yavatmal Energy Ltd. was a company jointly established by Lokmat group and Infrastructural Development Finance Company (IDFC) ltd. for implementing the 1215 MW power project in Maharashtra. It was also stated in the covering letter that the applicant company as controlled and managed by Lokmat and IDFC having combined turnover of Rs. 1218.02 crores, profit of Rs. 438.14 crores for the year 2005-06 and networth of Rs. 2617.57 crores as on 31.03.06. There were stated to be 7 directors of the company namely Sh.Vijay Darda, Sh. Rajendra Darda, Sh. Devendra Darda, Sh. Manoj Jayaswal, Sh. Anand Jayaswal, Sh. Abhishek Jayaswal and Ms. Karishma Jayaswal.
540. He deposed that during the course of investigation it was found that IDFC was never controlling or managing the company M/s JLD Yavatmal Energy Ltd. and thus the said claim was found to be false during the course of investigation.
541. It was also found that Lokmat Group was not having any holding in the applicant company on its own though the directors in some of the company of Lokmat Group namely Vijay Darda, Devendra Darda and Rajendra Darda were directors in the applicant company. It was also found that a similar CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 191 of 405 misrepresentation was also there in column No. 6 of the application Ex. PW 1/B wherein also it was stated that the applicant company is promoted, controlled and managed by Lokmat Group and IDFC.
542. It was also found during the course of investigation that the applicant company in column no. 23 titled "Finance", had stated that the financial closure has been achieved and has been tied up. Though alongwith the application a letter dated 09.01.2007 of IDFC Ex. PW 1/C (colly), was also annexed but in the said letter addressed to M/s JLD Yavatmal Energy Ltd., IDFC had only stated that they are in principal agreeable to the grant of the required financial assistant but it was found that no financial closure was yet achieved by the company or tie up was made and thus on the said issue also the company was found to have misrepresented. Consequently it was also found that the financial data of IDFC qua its turnover, profit and networth as was mentioned in column no. 8, 9 and 10 of the application was also a misrepresentation as IDFC had never permitted the applicant company M/s JLD Yavatmal Energy Ltd. to use its said financial data.
543. He told that his said conclusion was based on the MOU Ex. PW 3/F (D-7) which was executed between M/s Abhijeet Infrastructure Ltd., M/s Lokmat Newspaper Ltd. and IDFC. In the said MOU it was also stated CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 192 of 405 specifically by IDFC that they shall not be deemed to be treated as the promoter or sponsors of the SPV i.e. M/s JLD Yavatmal Energy Ltd. for any purpose or reason whatsoever.
544. During investigation he did not find that any officer or employee of IDFC was ever a director in M/s JLD Yavatmal Energy Ltd..
545. During investigation it was also found that the company had misrepresented in its application in column No. 30 that no earlier coal block has been allocated to its group or associated company. However during investigation it was found that Abhijeet Infrastructure Ltd. which infact had executed the MOU Ex. PW 3/F, vide which the SPV, M/s JLD Yavatmal Energy Ltd. was formed, had been earlier allotted 3 coal blocks and the said information was with-held from MoC by the applicant company in its application form.
546. Upon being asked to explain about the Abhijeet Group, the witness stated that pursuant to a family settlement having been arrived in the Jayaswal family in March 2006 vide memorandum of understanding Ex. PW 3/A (D-21), certain companies fell to the share of Manoj Jayaswal and the said group of companies were termed as Abhijeet Group.
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547. The aforesaid misrepresentation regarding, IDFC and previous allocation of coal block was also found to be there in the feedback form Ex. PW 3/J (PW 3/J-1)(D-38) as was submitted by the applicant company to the 35 th Screening Committee, MoC.
548. It was also found during the course of investigation that one other coal block was also already allotted in favour of one other group company i.e. M/s Corporate Ispat Alloys Ltd.
549. Upon being asked as to what was found during the course of investigation regarding the checking of applications for their eligibility and completeness in MoC, the witness stated that during the investigation it was found that no such checking was carried out in MoC.
550. Upon being asked about the checking of financial strength of applicant companies in MoC, the witness stated that in the minutes of 35 th Screening Committee, it was mentioned that the financial strength of the applicant companies shall be got verified through financial experts of Coal India Ltd. (CIL). However when the said officers of CIL were examined during the course of Investigation then they not only stated that they were no financial experts but also stated that they had not checked the financial strength of the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 194 of 405 applicant companies but had only scrutinized the financial documents as were given to them qua the financial strength of the applicant companies. It was also found that the Screening Committee or MoC, had not prepared any interse priority chart or interse merit chart of the applicant company. Nothing was found during the course of investigation which could show that any deliberation or discussion took place in the Screening Committee as to on what basis any given coal block be allotted or has been allotted to any particular company.
551. Upon being asked as to under what circumstances a closure report was filed in the Court u/s 173 Cr.PC when so many misrepresentations and other factors regarding allocation process had come to the notice of the witness during the course of investigation, the witness stated that though as per the evidence collected by him he was of the opinion that sufficient incriminating evidence warranting charge sheeting of various accused persons had come on record but the final competent authority was of the opinion that no sufficient incriminating evidence has come on record which may warrant charge sheeting the accused persons.
552. Prosecution had also filed affidavits of Ct. Gordhan Singh, Assistant Malkhana In-charge, EO-II, CBI dated 29.03.2019 which is Ex. PW 20/J and that of HC K.P. Singh, Malkhana, EO-I, CBI dated 29.03.2019 which CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 195 of 405 is Ex. PW 20/K (colly) as their evidence was of formal nature.
553. He told that the competent authority who approved the final report was the then Director, CBI namely Sh. Ranjit Sinha.
554. He was cross-examined on behalf of A-1. During the said cross- examination, much emphasis was on his conclusions mentioned in the closure report.
555. He admitted that it could not be established that M/s JLD Yavatmal Energy Ltd had obtained any undue benefit from MOC with respect to non disclosure of allocation of any earlier coal block allocated to its group/associate companies. He admitted that during the course of investigation nothing substantial emerged which could establish any element of cheating on the part of M/s JLD Yavatmal Emergy Ltd or its directors/officers and similarly nothing could emerge as regard existence of any conspiracy in between them or with officers of MOC. No evidence even cropped up during investigation qua exchange of any quid pro quo in between them or existence of any malafide intention / dishonest intention or mens rea on their part. He admitted that the final recommendation of 35th Screening Committee was signed by all the members present in the meeting. He admitted that from the said fact it was CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 196 of 405 concluded by him that the final recommendation was a unanimous recommendation of 35th Screening Committee.
556. He admitted that during the course of investigation the members of Screening Committee other than MOC officers who were examined by him stated that they were not able to recollect as to what had transpired between the Screening Committee members in the meeting held on 13.09.2007 on the basis of which the concerned companies were recommended for allocation of coal blocks.
557. He admitted that during the course of investigation the report prepared by the financial experts as were invited by MOC from CIL neither in original nor any copy thereof could be found. He told that during the course of investigation of coal block allocation matters registered by CBI, a number of records from MOC were stated to be missing and accordingly a separate PE in this regard was registered. He admitted that in all of his supplementary reports filed u/s 173 (8) Cr. PC including the reports filed after order dated 20.11.2014 passed by this Court referring the matter for further investigation, the final conclusion had been to pray the Court to close the case.
558. He admitted that he had not examined Sh. ABP Kesan, during the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 197 of 405 course of investigation. He admitted that he did not ask any witness about the meaning of the word "Principals" as was mentioned in the guidelines issued by MOC. One form for feedback of M/s JLD Yavatmal Energy Ltd available at pg. 20 in D-15 wherein on the second page at the bottom the name of "Sanjay Dey Vice President" was mentioned without any signatures upon it, was exhibited as Ex. PW 20/DX-1/A-4 (D-15).
559. Upon being asked as to whether the witness came to know as to why the feedback form was not submitted in the Screening Committee under the signatures of Sh. Sanjay Dey but was submitted under the signatures of Sh. Devendra Darda, the witness stated that since Sanjay Dey did not attend the Screening Committee and Devendra Darda had attended the meeting so he submitted the feedback form under his signatures.
560. He was also cross-examined on behalf of A-5 to A-7. He admitted that during the course of investigation he found that the company M/s JLD Yavatmal Energy Ltd had deliberately misrepresented facts before the Screening Committee and thereby the Screening Committee got induced in allocating a coal block in favour of the applicant company. He, however, also said that he did find acts of omission and commission on the part of public servants also but could not link them with the impugned acts of the applicant company. He CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 198 of 405 admitted that he did not find any guilty intention on the part of public servants in the alleged acts of omission and commission. He was further cross-examined generally on the investigation.
561. PW-20 was further cross-examined on behalf of A-1 with permission of the court. He admitted that in none of his report u/s 173 Cr. PC or u/s 173 (8) Cr. PC or in any of the progress report of further investigation filed in the Court, he had stated that the applicant company M/s JLD Yavatmal Energy Ltd had deliberately misrepresented facts before the Screening Committee and thereby the Screening Committee got induced in allocating a coal block in favour of the applicant company.
562. PW-21 is Dy. SP Sanjay Sehgal. He was initial IO.
563. He told that in the year 2012, Sh. V. Murgesan was Head of Branch and Sh. Nirbhay Kumar was SP in EO-II Branch. In the year 2013 Sh. Ravi Kant was Head of Branch and Sh. Vivek Dutt was the SP in EO-I Branch. He was well acquainted with the handwriting and signatures of the aforesaid officers.
564. He deposed that in September 2012, the FIR of the present case was marked to him for the purposes of investigation by Sh. Ravi Kant DIG, EO- CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 199 of 405 I. At that time he was already in Nagpur in connection with some other secret enquiry. The FIR was received by him on FAX and by evening Sh. Vivek Dutt SP also reached Nagpur with original copy of FIR and handed over the same to him. The FIR is Ex. PW21/A.
565. After discussing the case with him it was felt desirable and necessary that search operations be carried out so as to recover incriminating documents. Accordingly it was decided to conduct search operations u/s 165 Cr.PC without any further delay.
566. The search operations were accordingly planned to be conducted at three places i.e. two addresses at Nagpur and one at Raipur. The searches carried out Nagpur were at the office of JLD Yavatmal Energy Ltd. and at the residence of Director of the company Vijay Darda. The search was carried out at the plant office of the company. Further necessary authorisation to carry out search operation at Raipur was sent through special messenger to Additional SP M.K. Tiwari who was already camping at Raipur.
567. The search operations were decided to be carried out on 04.09.2012, simultaneously at all the three places. He was also informed by the senior officers that search operations at the residence of other directors of the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 200 of 405 company were also planned to be carried out by other CBI officers in the investigation of other cases registered against them. The senior officers accordingly made the necessary logistic arrangements at Nagpur i.e. arrangement of witness and vehicles etc.
568. He deposed about the searches carried out on 04.09.2012.
569. He identified his signatures on search list Ex. PW 9/A (D-50) relating to various documents recovered in the search operation carried out the office premises of M/s JLD Yavatmal Energy Ltd.. i.e. at 191H 92 Ring Road, Trimurti, Nagpur Nagar, Maharashtra. He also identified the document Ex. PW 3/E (Colly) (D-51), as one of the document which was seized during the search operation at serial no. 9 of the search list.
570. He identified his signatures on receipt memo Ex. PW 8/A (D-6) relating to various documents which were received by him from Sh. Vivek Kumar Head Company Secretary, Abhijeet Group, Nagpur. He identified various documents available in D-7, D-8, D-9, D-10 and D-11 to be the same which were received vide receipt memo Ex. PW 8/A.
571. The details of the documents so received are as under:
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 201 of 405
(i) Original Memorandum of Understanding dated 27.12.2006 between M/s Abhijeet Infrastructure Ltd and M/s Lokmat Newspapers Private Limited and IDFC Limited containing pages 1 to 6. (Already exhibited as Ex. PW 3/F (D-7))
(ii) Photocopy of Application dated 05.01.2007 of JLD Yavatmal Energy Limited submitted to Ministry of Coal, New Delhi, containing pages 1 to
8. (Already Exhibited as Ex. PW 8/B (D-8))
(iii) Photocopy of letter dated 26.07.2007 and 10.01.2008 of Sh. Sushil Kumar Shinde, Minister of Power addressed to Sh. Vijay Darda, MP, containing pages 1 to 4. ( Already Exhibited as Ex. PW 8/C (D-9))
(iv) Copy of presentation to the 35th Screening Committee, Ministry of Coal by JLD Yavatmal Energy Limited containing pages 1 to 13. (Already Exhibited as Ex. PW 8/D (D-10))
(v) Details of list of Bank Accounts of JAS Infrastructure & Power Limited and Manoj Jayaswal, Abhishek Jayaswal and Abhijeet Jayaswal - 2 pages.
(Already Exhibited as Ex. PW 8/E (D-11))
572. He had also recorded statements of Mr. Arvind Jayaswal and his son.
573. He also deposed about seizure memo Ex. PW 7/A (D-12), vide which Dy. SP S.P. Rana CBI had seized two documents. Subsequently he handed over the same to him through his supplementary case diary and the same were accordingly taken on record.
574. All the documents were deposited in the Malkhana of EO-I CBI. He also submitted an intimation of conducting the searches u/s 165 Cr.PC to the Court of Ld. CMM Tis Hazari Courts with the request to permit retaining of documents seized during the search for the purpose of further investigation. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 202 of 405
575. Witness identified his application bearing his signatures at point A alongwith all necessary enclosures. The application as above is exhibited as Ex. PW 21/B (Colly).
576. Thereafter on the orders of senior officers, the further investigation of the matter was transferred to Insp. Himanshu Bahuguna on 19.09.2012 itself. He accordingly handed over the case diary and other documents available with him to Insp. Himanshu Bahuguna.
577. Nothing has come out in cross-examination.
578. PW-22 is Dy. SP K.L. Moses who had conducted some part investigation in the present case and filed his affidavit dated 14.03.2018 which is Ex. PW 22/A.
579. Nothing has come out in cross-examination.
PART - D STATEMENTS OF ACCUSED PERSONS U/S 313 CRPC
580. Statement of all the accused persons were thereafter recorded u/s 313 CrPC in detail. Liberty was also given to all the accused persons to file their CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 203 of 405 written statements u/s 313 (5) CrPC. Accordingly A-1 to A-4 filed their written statements u/s 313 (5) CrPC. A-2 and A-5 led evidence in their defence.
PART - E THE DEFENCE EVIDENCE
581. A-2 examined DW-1 Manish Rajvaidya.
582. He deposed that he was a practicing Company Secretary since 2016. Photocopy of his certificate of practice issued by Institute of Company Secretaries is Ex. DW 1/A.
583. He deposed that while he was working in Jas Toll Road Company, then initially for a period of 4-5 months, he was reporting directly to Sh. Sanjay Dey, Company Secretary. Thereafter, he was reporting to Sh. A.B.P. Kesan, Company Secretary. He knew Sh. A.B.P. Kesan for the past about 3-4 years as he was the Chairman of Institute of Company Secretaries, Nagpur Chapter and he had promoted and helped him in his career. Sh. A.B.P. Kesan was working with Sunflag Iron and Steel Ltd. Group. Subsequently Sh. A.B.P. Kesan had joined Abhijeet Group of BLS family in August 2006 and was on the payrolls of M/s Corporate Ispat Alloys Ltd. The said company was also dealing in coal CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 204 of 405 mining business. M/s Sunflag Iron and Steel Ltd. is also involved in coal mining business.
584. He deposed that he used to report to Sh. A.B.P. Kesan and Sh. Kesan used to report to Sh. B.L. Shaw. He stated that Company M/s JLD Yavatmal Energy Ltd. was incorporated in December 2006 and Sh. A.B.P. Kesan had got it incorporated. Soon after incorporation of the company, Sh. A.B.P. Kesan was appointed as its Company Secretary.
585. He further deposed that Sh. B.L. Shaw was the Chairman of Neco Group of companies and BLS family companies. Since Sh. A.B.P. Kesan was not very comfortable with the use of Computers, so many a times he used to take him along in his meetings with Sh. B.L. Shaw. DW-1 used to take dictation from Sh. B.L. Shaw as well as Sh. A.B.P. Kesan. Subsequently on many occasions Sh. B.L. Shaw also used to directly call him for one or the other work/information. He also used to look after the work of M/s JLD Yavatmal Energy Pvt. Ltd.
586. He further told that Sh. B.L. Shaw had three sons namely Sh. Arbind Jayaswal, Sh. Manoj Jayaswal and Sh. Ramesh Jayaswal. He told that Sh. B.L. Shaw did not use to trust his three sons so all the decisions relating to CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 205 of 405 various companies of the group used to be taken by Sh. B.L. Shaw himself only. Since all the business was set up by Sh. B.L. Shaw so they all used to follow his instructions only.
587. He deposed that Sh. B.L. Shaw used to consider Sh. Manoj Jayaswal as an irresponsible person because of his flamboyant nature. He used to consider Sh. Manoj Jayaswal as a very incompetent person. He had restricted Sh. Manoj Jayaswal's role only to administrative work such as HR related issues of the companies, bill passing of employees etc. He did not use to allow Mr. Manoj Jayaswal to deal with any matters in any public offices.
588. Various Companies of the Neco group however used to work independently but certain matters such as filing of annual compliances, the same used to be dealt with by a centralised office of the Neco group.
589. All the work relating to allocation of coal block on behalf of various companies including filing of application forms or submitting other documents to concerned public offices was looked after by Sh. B.L. Shaw alongwith Sh. ABP Kesan. He also used to assist them in this work. All the policy decisions in such matters used to be taken by Sh. B.L. Shaw only.
590. Upon being asked as to who used to take decisions in various CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 206 of 405 companies of the group, the witness stated that practically in family owned companies, the decisions are taken by the person who is at the helm of affairs and thus with respect to Neco Group of Companies the decisions used to be taken by Sh. B.L. Shaw and not by the directors of the companies, though it used to be recorded on papers that the decisions have been taken by directors. Accordingly all the decisions relating to submitting of application on behalf of M/s JLD Yavatmal Energy Pvt. Ltd. to MoC or making presentation before Screening Committee or submitting feedback form on behalf of the company were taken by Sh. B.L. Shaw.
591. He deposed that he had seen the application and feedback form beside the presentation of M/s JLD Yavatmal Energy Pvt. Ltd. as was submitted to MoC for seeking allocation of coal block. He stated that Sh. Manoj Jayaswal had no role in providing any information relating to any of the columns in the application or in the feedback form or in the presentation as was submitted to MoC on behalf of the company. The information as was mentioned in the application, feedback form or in the presentation was provided by Sh. B.L. Shaw and Sh. ABP Kesan. He stated that he used to be present in all the meetings when the application form, feedback form or presentation on behalf of the company was finalised and he used to coordinate in providing requisite CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 207 of 405 information as was required.
592. He further deposed that he also knew Sh. V.S. Garg as he was working as Director in M/s Corporate Ispat Alloys Ltd. during the same period. After all the decisions with respect to filing of application, feedback form and presentation on behalf of M/s JLD Yavatmal Energy Pvt. Ltd. were taken by Sh. B.L. Shaw, then all the said information used to be conveyed to Sh. V.S. Garg in the Mining Department either through Sh. ABP Kesan, himself or through Sh. Manoj Jayaswal.
593. He also knew Sh. Vijay Darda and Sh. Devendra Darda as they were not only prominent people of Nagpur but were also subscribers to the equity of M/s JLD Yavatmal Energy Pvt. Ltd. and were directors of the company also. He deposed that they had no role to play in providing information for filing up or submission of application, feedback form or presentation to MoC on behalf of M/s JLD Yavatmal Energy Pvt. Ltd..
594. Regarding Sh. Harshad Popli, he stated that in the year 2013 Sh. Harshad Popli had filed some litigations against M/s Corporate Alloys Ispat Ltd. One petition was pertaining to claiming his gratuity amount from the company and another was filed for winding up of the company on account of his pending CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 208 of 405 dues. He was claiming some salaries dues and some other dues which were under dispute. Though the cases were filed against the company but he actually had a fight with Sh. Manoj Jayaswal. Sh. Harshad Popli had claimed certain dues and which were denied by Sh. Manoj Jayaswal. He had even said to Sh. Manoj Jayaswal that he was a prosecution witness so he must clear all his dues failing which he would depose against him.
595. He further stated that during the investigation of the present case CBI had examined Manoj Jayaswal, Harshad Popli, V.S. Garg, Sanjay Dey, Vinay Taneja, Vivek Kumar and other employees of the company, however his statement or that of Sh. ABP Kesan was not recorded though they had volunteered to CBI officer for getting our statement recorded.
596. Regarding IDFC, he deposed that B.L. Shaw and IDFC had decided to co-apply for allocation of a coal block on behalf of M/s JLD Yavatmal Energy Pvt. Ltd. He stated that it was decided that since networth was a relevant criteria in the application to be submitted to MoC for allocation of a coal block so the networth of IDFC shall be used in the application to be submitted to MoC on behalf of M/s JLD Yavatmal Energy Pvt. Ltd.. However IDFC had put a pre-condition that if they had to co-apply then the information to be mentioned in the application, feedback form and presentation should be in CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 209 of 405 accordance with the information provided by them. It was also decided by them that whatever information will be submitted to MoC should be first got vetted from them. The said conditions put-forth by IDFC were duly followed in the process of seeking allocation of a coal block. On behalf of IDFC Sh. Sachin Johri used to interact with our company. Sh. Sachin Johri was a director in Jas Toll Road Company Ltd.
597. Sh. Sachin Johri was interacting with Sh. B.L. Shaw so much because he was director in one of his company JAS Toll Road Company Ltd. From 16.12.2006 till October, 2016 and IDFC also held 33% equity shares in M/s JAS Toll Road Company Ltd. since 2006.
598. He deposed that Manoj Kumar Jayaswal had no role in any thing relating to coal block allocation. And it was B.L. Shaw who used to take all the decisions. He produced one document comprising of 3 pages i.e. letter dated 03.05.2007 in original written by Mr. A.B.P. Kesan to Sh. Hari Gopal Joshi attaching minutes of meeting to be signed as advised by Shri Babujee. The said letter is now marked as Ex.DW1/B (Objected to as to mode of proof). The letter is signed by Mr. A.B.P. Kesan.
599. He also produced an inter office communication dated 25.10.2005 CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 210 of 405 (in original), wherein Mr. Sanjay Dey had written to Shri Babuji about the reconstitution of the Board. The same bears signature of Mr. Sanjay Dey at point A. The same is Ex.DW1/C. He deposed that the same also bears endorsement/comments encircled as point B which has been made by Sh. B.L. Shaw and it also bears his signature at point C. In both the above documents reference to Babujee/Babuji means Mr. B.L. Shaw as everyone used to call him so.
600. He also produced a handwritten note (in original) by Sh. B.L. Shaw which is also signed by him at point A alongwith one CA Certificate and one letter. The said document is now marked as Ex.DW1/D (colly.). (Objected to as to mode of proof).
601. He deposed that after publication of advertisement Ex. PW 14/B-1 (D-30), Sh. B.L. Shaw started discussions with Mr. Kesan and him. As meaning of certain terms in the advertisement were not clear Sh. B.L. Shaw started extensive discussions with Mr. Kesan. Sh. B.L. Shaw also sought professional advice from various professionals. More so with respect to terms like "Group Company" and "Associated company". He told that all the information used to be collated by Sh. B.L. Shaw with assistance from Mr. Kesan and him. He deposed that IDFC had agreed to co-apply with pre-condition that every CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 211 of 405 application, feedback form, presentation or whatsoever correspondence with MoC shall be made only after specific approval of IDFC. Whenever any information was to be filled in, that information was sought from IDFC and filled in the relevant columns. Sh. B.L. Shaw after getting the information collated used to direct what is to be filled in. These directions from Sh. B.L. Shaw were conveyed to the mining department either through Sh. Manoj Jayaswal if he happened to go to the first floor of the building or through Sh. Kesan or sometimes through him. He stated that he used to be present in all such meetings/discussions and had seen this process himself being a part of it. After these documents were prepared they were sent to IDFC for approval and only after their approval they were submitted to MoC. In IDFC discussions were with Sachin Johri. Application was signed by Sh. Vinay Taneja, employee of Corporate Ispat Alloys Ltd. After the application was finalized by Sh. B.L. Shaw in consultation with IDFC, Mr. Kesan and other professionals including him. Sh. B.L. Shaw randomly selected Sh. Vinay Taneja to sign the application. Sh. Vinay Taneja was authorised by Sh. Kesan to sign as instructed by Sh. B.L. Shaw.
602. He deposed that IDFC had agreed to be promoter and this fact was communicated by Sh. Sachin Johri but at the time of presentation, IDFC CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 212 of 405 suggested some minor changes and it communicated that they would prefer the word 'partnering' as a minor change.
603. He stated that the MOU dated 27.12.2006 (Ex.PW3/F) was not submitted as an annexure to the application form because there was no such requirement to submit the MOU. IDFC had the same opinion and though there was no specific instruction, he took judgemental call not to annex the same.
604. He also stated that Group or associated company was not defined in Companies Act, 1956. Meaning of this term is different in Competition Act, 2005 and MRTP Act, 1969. Group has no legal identity but an individual company has. He further told that since the term 'group or associated company' was not defined in the guidelines, there were elaborate discussions on the same. The issue was to assess whether the SPV shall be considered as group company for BLS Family Companies. Sh. B.L. Shaw was of the opinion that since earlier allocation of coal blocks would be a benefiting factor, since it showed experience, the SPV JLD should be considered as group company for BLS Family Companies. But Sh. Sachin Johri had communicated that since three different constituents which did not have any previous association were coming together, the SPV shall not be considered as part of any group since it belonged to a new group altogether. He had also communicated that advisory board of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 213 of 405 IDFC was also of the same view. In view of the confusion and vagueness of the term, Sh. B.L. Shaw sought professional advice from various professionals including Mr. Kesan. Mr. Kesan was of the opinion that if BLS Family Companies were to be considered as group company for the SPV, it might amount to misrepresentation. Sh. Sachin Johri had even informed that if BLS Family Companies were considered as group companies for this SPV then the logic could extend to the level of IDFC also being considered as group company of BLS Family Companies. Sh. Sachin Johri informed that even decision board of the IDFC was also of the same view. Considering majority view and more so of IDFC, Sh. B.L. Shaw decided to write 'no' in the column.
605. He further deposed that since IDFC had promoted the SPV JLD Yavatmal Energy Ltd. so accordingly the term 'promoted' was used in the meaning and spirit as principal and same was the view of various professionals and was confirmed by Sh. V.S. Rana during aforesaid conversations.
606. He also deposed about letters written by A-4 Vijay Darda and told that these letters Sh. B.L. Shaw had got drafted through Sh. ABP Kesan. Sh. Vijay Darda was not willing to sign these letters but Sh. Kesan apprised him that allocation of the Coal Block will benefit largely to the poor districts of Yavatmal Maharashtra as captive plant was to be situated there, as it would generate huge CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 214 of 405 employment. Mr. Vijay Darda for the sole reason of benefit of its constituency and people agreed to sign the letters upon confirmation of correctness by Sh. ABP Kesan and Sh. B.L. Shaw.
607. He stated that A-2 Manoj Jayaswal and A-3 Devendra Darda had no role in providing informations in the application form or feedback form and Mr. Vijay Darda or Devendra Darda had no role or involvement in any of the affairs of JLD Yavatmal Energy Pvt. Ltd. including allocation of Coal Block.
608. He was cross examined by Ld. DLA.
609. He denied the suggestion that Manoj Kumar Jayaswal was looking after and managing the affairs of both companies i.e. M/s Corporate Ispat Alloys Ltd. and Abhijeet Infrastructure Ltd. as Managing Director. But stated that he might have been shown appointed as Managing Director of M/s Corporate Ispat Alloys Ltd. and he was not the Managing Director in Abhijeet Infrastructure Ltd. He explained that by 'shown appointed as Managing Director' he meant that in family owned companies, it is a normal practice that decisions are taken by the person who is at the helm of affairs of the family and on papers name of some other person is mentioned as decision taker. In the case of these CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 215 of 405 companies, Sh. B.L. Shaw was the actual decision taker whereas name of Sh. Manoj Kumar Jayaswal was used as a formality.
610. He denied the suggestion that Sh. B.L. Shaw was not the actual decision maker or Manoj Kumar Jayaswal was the actual person who used to take all the decisions for the companies.
611. When asked whether as per Companies Act, is it permissible for a person who was neither a Director nor a share holder to take any decision with regard to affairs of the company, he stated that strictly as per Companies Act, it is not permissible for a person who was neither a Director nor a share holder to take any decision with regard to affairs of the company. However, in actual practice, in relation to family group companies, it might happen that decisions are taken by the head of the family, who himself might not be Director or share holder in the company. The decisions so taken by the family head are recorded by the companies as passed by Directors or share holders themselves as the case may be.
612. He was aware of execution of MOU (family settlement dated 31.03.2006). He also referred to the Companies Act, 1956, Sec.2(30) which defines ' officer' and as per which officer includes any director, manager or CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 216 of 405 secretary or any person in accordance with whose directions or instructions the board of directors or any one or more of the directors is or are accustomed to act. He further referred to other provisions of the Companies Act, 1956, viz. Sec.5, Sec.7, Sec.239, Sec.307, Sec.370, Sec.602, etc. where the word 'officer' has been used.
613. He could not show any document where B.L.Shaw was appointed as officer of the above said company. He could not show any document that he was looking after the work of JLD Yavatmal Energy Ltd. but explained that it is a routine practice that professionals handle work relating to multiple companies. He denied that he was not looking after work of JLD Yavatmal Energy Ltd. at any point of time. He could not show any document to show that Mr. Shaw had taken any decision with respect to preparation of application form, feed back form and presentation of JLD Yavatmal Energy Ltd. in consultation with him and Mr. Kesan but explained that it was done verbally by Mr. Shaw. He could not show any document that Sh. B.L. Shaw had any role in the formation of JLD Yavatmal Energy Ltd. He denied that Sh. B.L. Shaw was not having any say or role in the formation of JLD Yavatmal Energy Ltd. He denied that role of Manoj Kumar Jayaswal was not restricted to Administrative Works such as HR related issues of the companies, bill passing of employees or that Manoj Kumar CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 217 of 405 Jayaswal was allowed to deal with any matters in any public offices. He denied that Vijay Darda and Devendra Darda had role to play in providing information for filling up of submission of application form, feed back form or presentation to MoC on behalf of JLD Yavatmal Energy Ltd. He denied various other suggestions of Ld. DLA.
614. After seeing MOU dated 27.12.2006, Ex. PW-3/F (D-7), he told that IDFC was not a subscriber to the MOU while the SPV in the name of JLD Yavatmal Energy Ltd. was incorporated. He also told that no employee or nominee of IDFC was a director at the time of incorporation of JLD Yavatmal Energy Ltd. Further, no nominee or employee of IDFC was appointed as director in JLD Yavatmal Energy Ltd. at the time of filing application for allocation of Coal Block or at the time of presentation before the 35 th Screening Committee meeting held on 21.06.2007 or at the time of allocation of Coal Block to M/s JLD Yavatmal Energy Ltd. or thereafter till the execution of indenture of family settlement dated 31.07.2008. Further he told that no employee or nominee of IDFC was a shareholder in JLD Yavatmal Energy Ltd. from incorporation till execution of indenture of family settlement (IFS) dated 31.07.2008.
615. He could not show any resolution of Board of Directors of JLD CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 218 of 405 Yavatmal Energy Ltd., Lokmat Group or IDFC authorising BL Shaw for taking decisions for preparation of application form, feedback form and presentation in consultation with IDFC.
616. He was extensively cross-examined to show that B.L. Shaw had nothing to do with application for coal block allocation on behalf of JLD.
617. He admitted that Manoj Kumar Jayaswal had filed a civil suit at Nagpur. He did not remember the civil suit number or the names of the defendants. Photocopy of plaint of Civil Suit No. 603/2008 in the Court of Civil Judge, Senior Division Nagpur on 07.05.2008 against M/s Neco Leasing and Finance Pvt. Ltd., Basant Lal Shaw, Arvind Jayaswal and Ramesh Jayaswal was marked as Ex. DW-1/PX1 (Colly). (There was objection as to mode of proof. Objection is overruled as certified copy was seen from the file of another case).
618. The prosecution produced one certificate u/s 65 B of the Evidence Act alongwith printouts of one e-mail dated 27.11.2012 and its attachment i.e. family MOU 2006.pdf. Same were shown to the witness and he admits them to be correct. The printouts of the e-mail and its attachment are Ex.DW1/PX-2 (Colly.).
619. He denied various suggestions given by Ld. DLA. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 219 of 405
620. DW-2 Nirmal Parkash Manchanda was examined on behalf of accused A-5 H.C. Gupta. He was with Coal India Ltd. and in the year 2007, he was Sr. PA and attached with Mr. R.K. Joshi, the then GM at Delhi at Scope Minar, Laxmi Nagar, Delhi.
621. He deposed that in 2007, desktop computers were available for typing work. In the year 2007, he had assisted Sh. Samiran Dutta and Mrs. Sushmita Sen Gupta in their typing work. The typing work was carried out on desktop computer situated adjacent to GM chamber. These two Officers were posted at headquarters at Kolkata and they were financial experts. He deposed that in his presence, no officer or staff from MoC had accompanied them in the Scope Minar, Laxmi Nagar.
622. After seeing one Excel Sheet from Page 32 to 39 and another Excel Sheet from Page 70 to 77 of D-164 (MR 340/12) available as Ex.PW3/E (Colly.) in case file titled as 'CBI Vs. Y. Harish Chandra Prasad & Ors.' being CBI Case No. 292/2019, he stated that he had not typed any of these documents.
623. After seeing the running matter titled 'Notes as per remark column' at Page 78 to 84 attached to second Excel Sheet of D-164 as above, he stated that he had typed similar matter but he was not sure whether he had typed these CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 220 of 405 pages or not as it was an old matter.
624. (Photocopy of D-164 is already exhibited as Ex.D-4 (Colly.) (as admitted u/s 294 CrPC)).
625. In cross-examination, he told that he had no idea that two officials from MoC were provided to aforesaid officers for assistance and they were assisting them in their work at the office.
626. He was cross-examined on behalf of accused K.S Kropha also.
PART - F THE ARGUMENTS
627. Detailed final arguments in the matter were heard as were addressed by Sh. A.P. Singh, Ld. DLA on behalf of CBI, by Sh. Vijay Aggarwal and Sh. Mudit Jain, Ld. Counsels on behalf of accused persons A-1 to A-4 and by Sh. Rahul Tyagi, Ld. Counsel on behalf of accused persons A-5 to A-7.
628. Written submissions, in support of the arguments, were also filed. I have gone through the same as well.
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629. Ld. DLA argued that the prosecution has proved its case beyond reasonable doubts. Referring to the testimonies of the witnesses and the documents, he submitted that the prosecution has proved the charges. He emphasized that the conspiracy among the accused persons stands established and the offences of cheating and criminal misconduct/corruption are clearly made out.
630. Ld. Prosecutor highlighted the relevant documents and testimonies and submitted that CBI has established that accused persons made misrepresentations to MoC while making application, and also in the feedback form during presentation, and further in letters written by A-3 Vijay Darda and thus cheated the MoC to issue coal block allocation letter. According to ld. Prosecutor, accused A-1 to A-4 made misrepresentations about networth of the A-1 company. Further, he submitted that A-5 to A-7 were hand in glove with A- 1 to A-4 and deliberately assisted them in achieving their objective of allocation of coal block.
631. Ld. DLA argued that A-1 company fraudulently claimed in its application that it was joint promoted, controlled and managed by Lokmat Group and IDFC. He submitted that the MOU dt. 27.12.2006 (Ex. PW3/F) was deliberately not filed alongwith the application as accused persons wanted to CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 222 of 405 conceal that it was promoted by Abhijeet Group also. This was done to conceal previous allocations made to other companies of the Abhijeet Group. Further false information regarding appraisal and syndication of debt by IDFC was also provided to MoC. He contended that JLD was not eligible for allocation of any coal block as it was not engaged in power generation. He pointed out roles of all the accused persons. He also vehemently argued that networth of IDFC could not be used by JLD at all. He contended that these accused were in conspiracy with accused public servants.
632. Regarding accused public servants, Ld. DLA submitted that they were in conspiracy with private accused persons and are guilty of many acts and omissions and thus committed offence of criminal misconduct under PC Act.
633. On the other hand, Ld. Counsels for the accused persons argued that prosecution has miserably failed to prove the charges. According to them, there is no material showing commission of offences of cheating and corruption. He contended that the ingredients of the offences are not proved. Regarding conspiracy, they submitted that there is no material at all to show existence of any conspiracy.
634. Ld. Counsel Sh. Vijay Aggarwal for A-1 to A-4 submitted that CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 223 of 405 IDFC was a co-applicant for allocation of coal. He submitted that IDFC was also a principal of SPV namely JLD. As such its networth could be used. He contended that there was no requirement of filing the MOU with the application. He argued that there was no misrepresentation regarding previous allocation as no coal block was earlier allocation to JLD. He contended that JLD was an eligible company as it was engaged in power generation. He vehemently submitted that no case was made out against A-1 to A-4. He prayed for their acquittal.
635. Ld. Counsel Sh. Rahul Tyagi for A-5 to A-7 vehemently submitted that cognizance was wrongly taken against the accused public servants as there was no sanction u/s 19 of PC Act in respect of A-6 and A-7. He contended that order dt. 22.07.2015 providing for deemed sanction is unsustainable. Further there was no sanction u/s 197 CrPC against A-5 to A-7.
636. He also contended that misrepresentations were not known to A-5 to A-7. He also submitted that guidelines of MoC were not binding and their violation cannot lead to prosecution. He submitted that even otherwise prosecution did not specify which guideline was violated. He also submitted that UMPP criteria was not in the knowledge of A-5 to A-7 as it was never communicated to MoC. He stressed that there is no allegation of any demand CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 224 of 405 on the part of accused public servants and there is no quid pro quo.
637. He also argued that recommendations of Nodal Ministry/Admininstrative Ministry and State Govts. were not binding on Screening Committee. He also submitted that allocation happened only when recommendations of Screening Committee were accepted by the Minister of Coal. He prayed for acquittal of A-5 to A-7.
638. Ld. DLA rebutted all the contentions of the learned defence counsels. Further, learned defence counsels were also given opportunity to reply to those submissions.
639. The contentions of respective learned counsels will be noted in details at the time of analysis and discussion.
PART-G THE ANALYSIS AND DECISION OF THE COURT
640. Before the contentions on merits are noted, a few general submissions made Ld. Counsels for the accused persons regarding various aspects of a criminal trial may be noted.
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641. It may also be mentioned herein that the emphasis in the quoted portions of various judgments, unless specified otherwise, is supplied by the respective counsels.
642. Ld. Counsel for the accused persons A-1 to A-4 submitted that a criminal trial is not like a fairy tale wherein one is free to give flight to one's imagination and fantasy. He referred to Jaikam Khan v. State of U.P., 2021 SCC OnLine SC 1256 wherein it was observed:
"78. To say the least, we are shocked at the aforesaid finding. The narration makes for an interesting reading as a story. However, all the observations are nothing but conjectures and surmises, without there being any evidentiary support to them. It is really surprising, as to how the Additional Sessions Judge could have dealt with the present case in such a casual manner when he was considering the question of life and death of four accused.
79. At this stage, we would like to remind ourselves as well as all the Courts in the country the golden principle to be followed in criminal jurisprudence. This Court, speaking through legendry H.R. Khanna, J., in the case of the State of Punjab v. Jagir Singh, Baljit Singh and Karam Singh observed thus:
"23. A criminal trial is not like a fairy tale wherein one is free to give flight to one's imagination and fantasy. It concerns itself with the question as to whether the accused arraigned at the trial is guilty of the crime with which he is charged. Crime is an event in real life and is the product of interplay of different human emotions. In arriving at the conclusion about the guilt of the accused charged with the commission of a crime, the court has to judge the evidence by the yardstick of probabilities, its intrinsic worth and the animus of witnesses. Every case in the final analysis would have to depend upon its own facts. Although the benefit of every reasonable doubt CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 226 of 405 should be given to the accused, the courts should not at the same time reject evidence which is ex facie trustworthy on grounds which are fanciful or in the nature of conjectures."
643. He next submitted that every accused is presumed to be innocent unless the guilt is proved. In this regard, he referred to Babu v. State of Kerala (2010) 9 SCC 189 wherein it was observed:
"(IV) Burden of proof and doctrine of innocence 27: Every accused is presumed to be innocent unless the guilt is proved. The presumption of innocence is a human right. However, subject to the statutory exceptions, the said principle forms the basis of criminal jurisprudence. For this purpose, the nature of the offence, its seriousness and gravity thereof has to be taken into consideration. The courts must be on guard to see that merely on the application of the presumption, the same may not lead to any injustice or mistaken conviction.
28: However, in cases where the statute does not provide for the burden of proof on the accused, it always lies on the prosecution.
644. Ld. Counsel also put forth that in criminal trials accused is presumed to be innocent and it is for the prosecution to prove the guilt. He relied upon Hanumant v. State of M.P., 1952 SCR 1091 and the observations as follows:
"17. Another circumstance on which reliance was placed was that certain rates in Exhibit P-3-A are lower than the corresponding rates in Exhibit P- 6 by only one or two pies. There is no doubt that one or two rates are lower by two pies than the rates in Exhibit P-6 but nothing follows from that innocent circumstance, unless one starts with a presumption of guilt. Once it is assumed that the tender of Doongaji was shown to CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 227 of 405 Patel, all these circumstances might to some extent fit in with the view that in certain respects it may have been copied from Exhibit P-6. The courts below fell into this error and departed from the rule that in a criminal case an accused person is to be presumed to be innocent and that it is for the prosecution to establish his guilt conclusively."
645. His further submission is that graver the offence, higher the proof. Relying upon Padala Veera Reddy v. State of A.P., 1989 Supp (2) SCC 706, he quoted the below mentioned para:
"22. In Sharad Birdhichand Sarda v. State of Maharashtra [(1984) 4 SCC 116 : 1984 SCC (Cri) 487] this Court has reiterated the above dictum and pointed out that the suspicion, however great it may be, cannot take the place of legal proof and that "fouler the crime higher the proof"."
646. Relying upon Sharad Birdhichand Sarda v. State of Maharashtra, (1984) 4 SCC 116, he emphasized that case must be proved as "must or should" and not "may be". The Hon'ble Court held thus:
"153. A close analysis of this decision would show that the following conditions must be fulfilled before a case against an accused can be said to be fully established:
(1) the circumstances from which the conclusion of guilt is to be drawn should be fully established.
It may be noted here that this Court indicated that the circumstances concerned "must or should" and not "may be" established. There is not only a grammatical but a legal distinction between "may be proved" and "must be or should be proved" as was held by this Court in Shivaji Sahabrao Bobade v. State of Maharashtra [(1973) 2 SCC 793 : 1973 SCC (Cri) 1033 :
1973 Crl LJ 1783] where the observations were made : [SCC para 19, p. 807 : SCC (Cri) p. 1047] "Certainly, it is a primary principle that the accused must be and not merely may be guilty before a court can convict and the mental distance between 'may be' and 'must be' is long and divides vague conjectures CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 228 of 405 from sure conclusions."
(2) the facts so established should be consistent only with the hypothesis of the guilt of the accused, that is to say, they should not be explainable on any other hypothesis except that the accused is guilty, (3) the circumstances should be of a conclusive nature and tendency, (4) they should exclude every possible hypothesis except the one to be proved, and (5) there must be a chain of evidence so complete as not to leave any reasonable ground for the conclusion consistent with the innocence of the accused and must show that in all human probability the act must have been done by the accused.
154. These five golden principles, if we may say so, constitute the panchsheel of the proof of a case based on circumstantial evidence."
647. He further submitted that all the circumstances should be complete and there should be no gap left in the chain of evidence. In this context, he referred to Mujeeb v. State of Kerala, (2000) 10 SCC 315, and the observations in it thus:
7. ... ... If any link in the chain is missing the guilt of the accused cannot be established.
......
9. In Umedbhai Jadavbhai v. State of Gujarat [(1978) 1 SCC 228 : 1978 SCC (Cri) 108 : AIR 1978 SC 424 : (1978) 2 SCR 471] this Court held that it is well settled that in a case resting on circumstantial evidence all the circumstances brought out by the prosecution, must inevitably and exclusively point to the guilt of the accused and there should be no circumstance which may reasonably be considered consistent with the innocence of the accused. It was further held that in case of circumstantial evidence, the court will have to bear in mind the cumulative effect of all the circumstances in a given case and weigh them as an integrated whole.
Any missing link may be fatal to the prosecution case. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 229 of 405 .........
24. ... ... We hold that the High Court erred in law in not considering whether the circumstances proved, formed a complete chain. In this chain of circumstances the following links are missing namely -- hiring of taxi driven by the deceased by A-1, visiting the lake and the temple by the accused in the taxi driven by the deceased, giving soft drink mixed with sleeping tablets, intoxicating liquor and death of the deceased due to strangulation. In view of the above missing links in the chain of circumstances we hold that the prosecution has failed to establish the guilt of the accused cogently and firmly. ...
648. He again referred to Sharad Birdhichand Sarda v. State of Maharashtra, (1984) 4 SCC 116 wherein it was held:
"166. In the instant case, while two ingredients have been proved but two have not. In the first place, it has no doubt been proved that Manju died of potassium cyanide and secondly, it has also been proved that there was an opportunity to administer the poison. It has, however, not been proved by any evidence that the appellant had the poison in his possession. On the other hand, as indicated above, there is clear evidence of PW 2 that potassium cyanide could have been available to Manju from the plastic factory of her mother, but there is no evidence to show that the accused could have procured potassium cyanide from any available source. We might here extract a most unintelligible and extraordinary finding of the High Court--
"It is true that there is no direct evidence on these two points, because the prosecution is not able to lead evidence that the accused had secured potassium cyanide poison from a particular source. Similarly there is no direct evidence to prove that he had administered poison to Manju. However, it is not necessary to prove each and every fact by a direct evidence. Circumstantial evidence can be a basis for proving this fact." (p. 160)
167. The comment made by the High Court appears to be frightfully vague and absolutely unintelligible. While holding in the clearest possible terms that there is no evidence in this case to show that the appellant was in possession of poison, the High Court observes that this fact may be proved either by direct or indirect (circumstantial) evidence. But it fails to indicate the nature of the circumstantial or indirect evidence to show that the appellant was in possession of poison. If the Court seems CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 230 of 405 to suggest that merely because the appellant had the opportunity to administer poison and the same was found in the body of the deceased, it should be presumed that the appellant was in possession of poison, then it has committed a serious and gross error of law and has blatantly violated the principles laid down by this Court. The High Court has not indicated as to what was the basis for coming to a finding that the accused could have procured the cyanide. ... ... ...
169. We are, therefore, clearly of the opinion that the facts of the present appeal are covered by the ratio of the aforesaid decisions. At any rate, taking the worst view of the matter on the evidence in this case two possibilities are clearly open--
(1) that it may be a case of suicide, or (2) that it may be a case of murder and both are equally probable, hence the prosecution case stands disproved."
649. He also referred to Tomaso Bruno v. State of U.P., (2015) 7 SCC 178; C. Chenga Reddy v. State of A.P., (1996) 10 SCC 193; Bhagat Ram v. State of Punjab, AIR 1954 SC 621; and Hanumant v. State of M.P., 1952 (supra);
650. His next submission was that when two views are possible, the view favouring accused should be taken. Again, he relied upon Sharad Birdhichand Sarda v. State of Maharashtra (supra) wherein it was observed:
218. In view of the fact that this is a case of circumstantial evidence and further in view of the fact that two views are possible on the evidence on record, one pointing to the guilt of the accused and the other his innocence, the accused is entitled to have the benefit of one which is favourable to him. In that view of the matter I agree with my learned Brothers that the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 231 of 405 guilt of the accused has not been proved beyond all reasonable doubt.
651. Counsel also pleaded that strong suspicion, however, cannot take the place of proof to fasten criminal liability on the accused. For this, he referred to Chatt Ram v. State of Haryana (1980) 1 SCC 460; C. Chenga Reddy v. State of A.P., (supra); and Padala Veera Reddy v. State of A.P., 1989 Supp (2) SCC 706.
652. Ld. Counsel forcefully submitted that defence of the accused is to be investigated. He relied upon Bhagat Ram v. State of Punjab, AIR 1954 SC 621; and Vinod Kumar v. State of Kerela 2014 (5) SCC 678.
653. He also submitted that burden of proving the innocence is not on the accused. He relied upon the following decisions - Jaikam Khan v. State of U.P., (supra); Tomaso Bruno v. State of U.P., (supra); Vinod Kumar v. State of Kerela 2014 (5) SCC 678; C. Chenga Reddy v. State of A.P., (supra); Sudhdeo Jha Utpal v. State of Bihar AIR 1957 SC 466: 1957 CriLJ 583; Abdul Karim Madan Sahab v. State of Mysore (1979) 4 SCC 595; Babu v. State of Kerala (2010) 9 SCC 189; Nanhar v. State of Haryana (2010) 11 SCC 423; Sharad Birdhichand Sarda v. State of Maharashtra, (supra); and Anand Ramachandra Chougule v. Sidarai Laxman Chougala CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 232 of 405 (2019) 8 SCC 50.
654. He next submitted that Section 106 Indian Evidence Act does not absolve the prosecution of its burden to prove the case under Section 101 Indian Evidence Act. He relied upon these decisions in this regard:
a) Jaikam Khan v. State of U.P., 2021 SCC OnLine SC 1256 :
74. Insofar as the reliance placed by Shri Vinod Diwakar, learned AAG on the burden not being discharged by the accused and no explanation given by them in their Section 313 Cr.P.C. statement is concerned, it is trite law that only after the prosecution discharges its burden of proving the case beyond reasonable doubt, the burden would shift on the accused. It is not necessary to reiterate this proposition of law. It will suffice to refer to the following observations of this Court in the case of Joydeb Patra v. State of West Bengal:
"10. We are afraid, we cannot accept this submission of Mr. Ghosh. This Court has repeatedly held that the burden to prove the guilt of the accused beyond reasonable doubt is on the prosecution and it is only when this burden is discharged that the accused could prove any fact within his special knowledge under Section 106 of the Evidence Act to establish that he was not guilty. In Sucha Singh v. State of Punjab [(2001) 4 SCC 375 : 2001 SCC (Cri) 717] this Court held : (SCC p. 381, para 19) "19. We pointed out that Section 106 of the Evidence Act is not intended to relieve the prosecution of its burden to prove the guilt of the accused beyond reasonable doubt, but the section would apply to cases where the prosecution has succeeded in proving facts for which a reasonable inference can be drawn regarding the existence of certain other facts, unless the accused by virtue of special knowledge regarding such facts failed to offer any explanation which might drive the court to draw a different inference."
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 233 of 405 Similarly, in Vikramjit Singh v. State of Punjab [(2006) 12 SCC 306 :
(2007) 1 SCC (Cri) 732] this Court reiterated : (SCC p. 313, para 14) "14. Section 106 of the Evidence Act does not relieve the prosecution to prove its case beyond all reasonable doubt. Only when the prosecution case has been proved the burden in regard to such facts which was within the special knowledge of the accused may be shifted to the accused for explaining the same. Of course, there are certain exceptions to the said rule e.g. where burden of proof may be imposed upon the accused by reason of a statute.""
75. In that view of the matter, we do not find any merit in the said submissions.
b) Mangu Singh v. Dharmendra 2016 (2) JCC 821 "11: Section 106 does not absolve the prosecution's burden under Section 101 to prove its case of guilt of the accused beyond reasonable doubt."
c) Nagendra Sah v. State of Bihar (2021) 10 SCC 725
23. In a case governed by circumstantial evidence, if the chain of circumstances which is required to be established by the prosecution is not established, the failure of the accused to discharge the burden under Section 106 of the Evidence Act is not relevant at all. When the chain is not complete, falsity of the defence is no ground to convict the accused.
655. He also stressed that when grain and the chaff are inextricably mixed up, no new case can be made out. He cited Balaka Singh Vs. State of Punjab (1975) 4 SCC 511 in this regard.
656. Ld. Counsel also submitted that a moral conviction, howsoever strong, cannot amount to legal conviction. He again relied upon Sharad CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 234 of 405 Birdhichand Sarda v. State of Maharashtra, (supra).
657. The next submission of the ld. Counsel is that admission of document does not amount to proof thereof. He referred to Sudhir Engineering Company vs Nitco Roadways Ltd. 1995 [34] DRJ 86 -
"8. I am firmly of the opinion that mere admission of document in evidence does not amount to its proof."
658. Regarding documents, he argued that if witness is not examined, then document pertaining to him cannot be relied upon. He cited the following decisions in this regard -- Shyam Bir vs State (Delhi) 2009 (3) JCC 2121; Standard Chartered Bank Vs Andhra Bank Financial Services Ltd. and Ors (2006) 6 SCC 94; and Hanumant v. State of M.P., (supra).
659. He further highlighted that res ipsa loquitur is not a principle of Criminal Law. He cited - Syad Akbar v. State of Karnataka, 1980 (1) SCC 30; and State of Karnataka v. Satish, 1998 (8) SCC 493.
660. Ld. Counsel further submitted that no inferences can be drawn of aspects which are not supported by evidence. He cited C. Chenga Reddy v. State of A.P., (supra) wherein it was observed:
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 235 of 405 "14. ... ... It, therefore, appears to us that the trial court drew on its imagination to hold that the corrections made in the estimates and other documents established that the entries had been 'manipulated' to show that jungle-clearance work had been undertaken when it had not been so effected and that the corrections etc. had been made by the Executive Engineers without actually visiting the site and without making any actual verification at the spot. There is no material available on the record to support the above observations. None of the prosecution witnesses deposed that the appellants did not inspect the site before preparation or sanctioning of the estimates for the clearance work. ... ... ... ... The prosecution evidence reveals that the clearance of prickly pear jungle on the left and the right bank was also undertaken with a view to properly maintain the canal banks and to prevent their breaches during the rainy season besides facilitating the removal of obstruction of the jeep track. The High Court conjecturised while observing that since clearance of the right bank was not necessary for clearing the view of the jeep track "its clearance was not done". This is against the weight of evidence on the record.
661. He vehemently submitted that fact situation is to be considered, and not what may have happened. Again, he relied upon C. Chenga Reddy v. State of A.P., (supra).
662. He also argued that inferential evidence is not to be considered. He again referred to C. Chenga Reddy v. State of A.P., (supra).
663. Counsel further submitted that generalization, on the basis of some norm, rather than fact is not acceptable. He relied upon the following decisions:
a) C. Chenga Reddy v. State of A.P., (supra):
"33. Exs. P-1 and P-2, panchnamas, relied upon by the prosecution and accepted by the courts below for ascertaining the time taken for CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 236 of 405 clearing the jungle on the basis of work done by a labourer in a day do not help the prosecution. Apart from the fact that it is doubtful whether Exs. P-1 and P-2, the panchnamas, prepared during the investigation of the case can be used as substantive piece of evidence, since none of the labourers who are alleged to have done the clearing work were examined at the trial, we find it even otherwise an unsatisfactory manner of determining the time taken for work of jungle clearance. How much work one labourer can turn out would depend upon a number of factors like his skill, energy, experience, etc.? Generalisation as has been done by the prosecution and accepted by the courts below is neither fair nor proper."
b) Parminder Kaur v. State of Punjab, (2020) 8 SCC 811 (Three Judge Bench):
"Analysis I. Sweeping generalisations and superficial analysis
11. Having heard the learned counsel for the parties at considerable length through videoconferencing, we find from the impugned orders that the courts below failed in making the desired attempt to delve deep into the factual matrix of this case. Many aspects, as discussed hereunder, have completely been ignored or only dealt with hastily. Further, the reasoning is generic and is premised upon generalisations which may not be necessarily true always. It is indisputable that parents would not ordinarily endanger the reputation of their minor daughter merely to falsely implicate their opponents, but such clichés ought not to be the sole basis of dismissing reasonable doubts created and/or defences set out by the accused.
12. ... Sweeping assumptions concerning delays in registration of FIRs for sexual offences, send a problematic signal to society and create opportunities for abuse by miscreants. Instead, the facts of each individual case and the behaviour of the parties involved ought to be analysed by courts before reaching a conclusion on the reason and effect of delay in registration of FIR. ... ..."
664. Next he submitted that charge against an accused may be belied by the prosecution evidence itself. He referred to the following cases - Shrinivas CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 237 of 405 v. State of M.P., AIR 1954 SC 23 (Constitutional Bench); and C. Chenga Reddy v. State of A.P., (supra).
665. He forcefully submitted that adverse inference under Section 114
(g) of the Indian Evidence Act pursuant to non-examination of the material witnesses is fatal to the prosecution. He cited - Jaikam Khan v. State of U.P., 2021 (supra); Subhash v. State of U.P., (1976) 3 SCC 629; M. Abbas v. State of Kerala, (2001) 10 SCC 103; Tomaso Bruno v. State of U.P., (supra); Parminder Kaur v. State of Punjab, (2020) 8 SCC 811; C. Chenga Reddy v. State of A.P., (supra); Baljit Singh and Anr vs State of Uttar Pradesh (1976) 4 SCC 590; Pawan Kumar vs. State &Anr 2019 SCC OnLine Del 10452; and Mukesh Vs. State 2010 (2) JCC 1563.
666. His another forceful submission was that opinion of Investigating Officer is not evidence. For this, he relied upon Ashok Chawla vs. Ram Chander Garvan, Inspector CBI W.P. (Crl) 1429/2010 Decided on: 28-02- 2011.
667. Ld. Counsel further argued that there was shoddy investigation in this case. He submitted that there were lacunae in the prosecution case due to the non-investigation of the various aspects. He cited:
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 238 of 405
a) Subhash v. State of U.P., (1976) 3 SCC 629;
b) Parminder Kaur v. State of Punjab, (supra);
c) Tomaso Bruno v. State of U.P., (supra);
d) C. Chenga Reddy v. State of A.P., (1996) 10 SCC 193;
e) Babu v. State of Kerala (2010) 9 SCC 189;
F) State of NCT of Delhi vs Rakesh 2012 [2] JCC 1334; and
g) Manjit Singh vs State 2009(2) JCC 1501;
668. He also highlighted that there was delay in recording statement of witnesses and which is fatal for the prosecution case. He cited:
a) Durga Prasad v. State 2009 [4] JCC 2533;
b) Paramjit Singh & Ors. v. State of Punjab AIR 1997 SC
1694; and
c) Sahiya vs. State of UP JT 2002 (6) SC 318.
669. He next submitted that accused is to be permitted to explain the incriminating circumstances under Section 313 Cr.P.C. He relied upon:
a) M. Abbas v. State of Kerala, (2001) 10 SCC 103;
b) Parminder Kaur v. State of Punjab, (supra);
c) Bhagat Ram v. State of Punjab, AIR 1954 SC 621;
d) Hanumant v. State of M.P., (supra);
e) Reena Hazarika v. State of Assam (2019) 13 SCC 289;
f) Sk. Maqsood v. State of Maharashtra (2009) 6 SCC 583;
g) King-Emperor v. Alimuddi Naskar 1924 SCC OnLine Cal 136;
h) Machander v. State of Hyderabad (1955) 2 SCR 524; and
i) Sukhdev Shankar Nikumbe Vs. State of Maharashtra IV (2000) CCR 242 (SC) : MANU/SC/3556/2000.
670. He then submitted that defence taken by the accused is to be CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 239 of 405 disproved. He referred to Bhagat Ram v. State of Punjab, (supra).
671. Regarding credibility of the witnesses, he submitted that contradictions / improvement made by the witness during trial on vital aspects affects the credibility of the evidence. He relied upon - Jai Prakash v. State of U.P., (2020) 17 SCC 632; Parminder Kaur v. State of Punjab, (supra); and Tomaso Bruno v. State of U.P., (supra).
672. He next focused on statement made by a witness to the investigation officer during investigation and submitted that the same is hit by Section 162 Cr.P.C., be it in the form of statement or in the form of report or in the form of letters. He relied upon C. Chenga Reddy v. State of A.P., (supra).
673. Regarding aspect of giving suggestion to a witness during cross- examination, he argued that when a witness deposes a particular fact and no suggestion to the contrary is given to him in cross-examination, the party against whom the deposition is made, is deemed to have admitted that fact. He relied upon:
a) V.N. Deosthali v. State 2009 SCC OnLine Del 4069
19. ... ... During cross-examination of this witness, no suggestion was given to him that the registration form Ex.PW1/H was not signed by the appellant or that he was not conversant with the signature of the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 240 of 405 appellant. Similarly, during cross-examination of PW6 Shri Avdesh Narain, no suggestion was given to him that Ex.PW 1/H was not signed by the appellant at point A. In fact, no suggestion was given to him that the appellant had not stayed in hotel Meridian in the night intervening 19-20 February, 1991. When a witness deposes a particular fact and no suggestion to the contrary is given to him in cross-examination, the party against whom the deposition is made, is deemed to have admitted that fact.
b) Sarwan Singh v. State of Punjab (2003) 1 SCC 240
9. ... ... There exists no other evidence nor even there being any suggestion of existence of any other factor for such perforced outing at 3 a.m. It is a rule of essential justice that whenever the opponent has declined to avail himself of the opportunity to put his case in cross- examination it must follow that the evidence tendered on that issue ought to be accepted. A decision of the Calcutta High Court lends support to the observation as above. [See in this context A.E.G. Carapiet v. A.Y. Derderian [AIR 1961 Cal 359] (opinion of P.B. Mukherjee, J., as he then was).]
c) Shashi Bala v. Rajiv Arora 2012 SCC OnLine Del 1717
11. ... .... Consequently, the absence of proper rebuttal or failure of not putting one's case forward would certainly lead to acceptance of testimony of that witness whose deposition remains unchallenged. ...
674. And that failure to re-examine is fatal to the prosecution. He referred to:
a) Surender Singh vs State (NCT of Delhi) 2014 [4] JCC 2766
9. A strange feature of the cross-examination of PW 8 was that he made statements therein which were contrary to the case of the prosecution and yet no attempt was made by the APP to re-examine PW-
8 to seek clarifications or seek correction of the judicial record. The said statements made by PW-8 in his cross-examination reads thus:
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 241 of 405 It is wrong to suggest that the accused demanded or accepted Rs 1000/- as bribe from the complainant and kept the same in the left pocket of the shirt. It is also wrong to suggest that any such notes were recovered from his possession. It is also wrong to suggest that I took the right hand wash of the accused as stated by me in the examination in chief
b) Browne vs Dunn [From the Court of Appeal, England] 28.11.1983:
"... ... My Lords, I have always understood that if you intend to impeach a witness, you are bound, whilst he is in the box, to give an opportunity of making any explanation which is open to him; and, as it seems to me, that is not only a rule of professional practice in the conduct of a case, but it is essential to fair play and fair dealing with witnesses."
c) Vishwanathan vs State of Maharashtra 1995 CRILJ 2571:
12. ...However, in the cross-examination the panch ate his own words and had to admit that because of the din there he was not able to properly hear the conversation. This was an ambiguity left by the cross-examining Counsel and the said ambiguity could have been cleared in re-examination. However, the learned Additional Public Prosecutor sat over the matter and did not get this ambiguity cleared, thereby it will have to be presumed that the panch was referring to the conversation which he was supposed ot hear for hearing which he was specifically deputed. Not only this but the panch thereafter has changed the whole sequence by stating that after taking tea, the accused started leaving and complainant Ramesh PW 1 followed the accused and keep the amount in his right hand. Now there is some ambiguity here also...
675. He next pointed out that the defence is entitled to use a prosecution document although unexhibited and unproved. He quoted - Ramaiah v. State of Karnataka (2014) 9 SCC 365; Raj Bahadur vs. State MANU/DE/0449/1991; Ramesh Kumar vs. State of Delhi and Ors.
MANU/DE/2946/2016; Ramdayal vs. Madhya Pradesh 1993 MPLJ 534; CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 242 of 405
676. He again forcefully submitted that defence witness to be given equal weightage. He relied upon:
a) Jumni vs. state of Haryana 2014 11 SCC 355
23. On the standard of proof, it was held in Mohinder Singh v. State that the standard of proof required in regard to a plea of alibi must be the same as the standard applied to the prosecution evidence and in both cases it should be a reasonable standard. Dudh Nath Pandey goes a step further and seeks to bury the ghost of disbelief that shadows alibi witnesses, in the following words
19. ...Defence witnesses are entitled to equal treatment with those of the prosecution. And, courts ought to overcome their traditional, instinctive disbelief in defence witnesses. Quite often, they tell lies but so do the prosecution witnesses.
B) DDAVs VIP Marble Emporium & Ors 2012 Cri.L.J. 4678
7. ... ... The learned Magistrate seems to have fallen into an error by observing that the testimony of CW-3 is that of a Sales Tax Officer (hereinafter referred to as 'STO') while as the testimony of DW-1 is a junior level officer and much below in rank to STO, and therefore, credence could not be given to the same. The credence to the testimony of a witness is not to be based on the post which he holds, a poor person may be truthful as compared to a rich person or holder of a higher post. There cannot be a generalization in this regard. The reasoning adopted by the learned Magistrate is totally erroneous. ...
677. He also submitted that the prosecution has to prove the exact date and time of the offence. He referred to Baijnath Jha Versus Sita Ram &Anr. 2008 (3) JCC 1823.
678. Ld. Sr. PP also acknowledged these aspects. He, however, also submitted that facts of a given case are to be kept in mind while applying these CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 243 of 405 principles.
679. Having heard learned counsels, and having gone through the cited decisions, it must be observed that there is no dispute with the propositions of law laid down in the cited decisions. But there is a caveat that all decisions are peculiar to their own facts and must be construed accordingly. The facts of a given case are also to be kept in mind while applying these principles. The facts of a given case make a whole lot of difference.
A few undisputed facts:
680. At this stage, let us notice few undisputed facts.
a) JLD was incorporated as a company on 18.12.2006 as per the certificate of incorporation.
b) At the time of incorporation, the Directors were from Jayaswal family and Darda family only.
c) An MOU dt. 27.12.2006 was entered into between Abhijeet Group, Lokmat Group and IDFC vide Ex. PW3/F.
d) An MOU dt. 31.03.2006 was executed between family members of BLS thereby dividing the companies which is Ex. PW3/A.
e) Accused No. 1 company i.e. JLD applied vide application dated 12/01/2007 Ex. PW1/B for allocation of coal block to the Ministry of Coal.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 244 of 405
f) It was claimed therein that JLD was jointly promoted, controlled and managed by Lokmat Group and IDFC.
g) A presentation was made before the 35th Screening Committee meeting held on 22/06/2007. Accused No. 4 had made the presentation.
h) A feedback form was submitted which is Ex. PW3/J. This feedback form is signed by Accused No. 4.
i) Accused No. 3 had sent various letters to PMO and Govt. of Maharashtra as well as various other authorities pitching for allocation of coal block namely Lohara West and Extension to JLD. He had written letters for change of coal block from Fatehpur East to Lohara West and Extension as well. These letters are Ex. PW3/Q-1 to Q-12.
j) In the application as well in the feedback form and during presentation, JLD claimed networth of IDFC as its own.
k) In the letters written by A-3, it was claimed all along that JLD was promoted, controlled and managed by Lokmat Group and IDFC.
POINTS FOR DETERMINATION
681. Now is the stage to take note of the points for determination arising in the present case.
682. At the outset, however, it needs to be mentioned that Ld. DLA stated at the bar that prosecution is not pressing the charge for the offence u/s CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 245 of 405 409 IPC and 13(1)(c) PC Act against accused A-5 H.C. Gupta. Consequently, it was also not pressing charge of conspiracy i.e. u/s 120-B r/w 409 IPC & 13(1)
(c) PC Act against any of the accused persons and it was restricted to offence u/s 120-B r/w 420 IPC & 13(1)(d) PC Act. As such, the said offences are being kept out of consideration.
683. Based on the arguments and submissions of the learned counsels for the parties, the following points for determination arise in the present case:
a) Was there no proper sanction u/s 19 of PC Act and thus cognizance was bad against accused A-6 and A-7?
b) Whether cognizance was bad in respect of A-5 to A-7 for want of sanction u/s 197 CrPC?
c) Were there any misrepresentations?
d) Whether those misrepresentations deceived any person?
e) Who is responsible for making those misrepresentations and thereby deceiving and fraudulently or dishonestly inducing the said person?
f) Whether the offence of cheating is made out against A-1 to A-4?
g) Whether offence of criminal misconduct/corruption is made out against A-5 to A-7?
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 246 of 405
h) Whether there was any conspiracy among all the accused persons?
684. Points for determination (a) and (b) will taken up in the end. POINT FOR DETERMINATION NO. (c):
WERE THERE ANY MISREPRESENTATIONS?
685. It is essential to find out whether there were any misrepresentation(s) or not because only if there were such misrepresentation(s), the prosecution could sustain its case. This is because only if there was/were misrepresentation(s), there could be deception and ultimately dishonest inducement.
686. Considering the allegations, this question can be considered in four broad categories as follows:
a) Misrepresentation regarding promoters;
b) Misrepresentation regarding networth;
c) Misrepresentation regarding appraisal and syndication of debt; and CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 247 of 405
d) Misrepresentation regarding previous allocation of coal blocks.
(a) Misrepresentation regarding PROMOTERS & (b) Misrepresentation regarding NETWORTH 687. Both these issues can be taken up together.
688. Ld. DLA contended that accused No. 1 M/s. JLD fraudulently claimed in its application that it was jointly promoted, controlled and managed by Lokmat Group and IDFC Ltd. He referred to clause 2a of the MOU dated 27/12/2006 (Ex PW3/F) wherein it was specifically mentioned that IDFC shall not be deemed to be or treated as promoter or sponsor of SPV for any reason whatsoever including for the purposes of the IPO of SPV and IDFC shall not be named as a promoter or sponsor in the prospectus or any other document related to the IPO of SPV.
689. Ld. DLA submitted that the MOU dated 27/12/2006 (Ex. PW3/F.) was deliberately not filed alongwith the application. The reason for this was to withhold/conceal information from MoC that JLD was also promoted by Abhijeet group and this was done as various coal blocks had already been allocated to other companies of Abhijeet group.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 248 of 405
690. Ld. DLA submitted that networth was an important aspect as it was part of the advertisement which is Ex. PW14/B-1 (Colly).
691. Counsel for the accused A1 to A4 argued that prosecution has not disputed that IDFC was a co-applicant for the coal block; that IDFC was also a partner; that the application for allocation of coal block was jointly submitted by IDFC; that IDFC was involved in the preparation of the presentation and was actually present also at the time of presentation through its officers. Counsel also pointed out that IDFC had agreed to acquire 20% of equity holdings in JLD. Counsel vehemently argued that IDFC was one of the principals of SPV namely JLD. As such JLD could use networth of IDFC. He pointed out that even the IO had submitted in the closure report that there was no evidence to show that the company JLD was given any undue benefit by the MoC. He referred to the evidence of the IO in this regard. He submitted that prosecution did not re-examine to rebut said statement of the IO. He relied upon V.N. Deosthali Vs. State thr. CBI, 2010(1) JCC 466 and also Rammi @ Rameshwar Vs. State of MP, (1999) 8 SCC 649. [There is no weight in the submissions. The prosecution is supposed to re-examine the witness only when the witness says something adverse on facts. For example, when a witness deposes a fact (which fact the witness had himself seen and heard) in CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 249 of 405 examination-in-chief and says the contrary fact in cross-examination, only in such a situation prosecution is required to re-examine the said witness. But when what the witness says in cross-examination is his opinion or understanding, the prosecution is not required to re-examine such a witness because prosecution can conveniently show that opinion or understanding of such a witness was wrong and there was material on record to the contrary. In that situation, of course, prosecution was required to re-examine the said witness. In the cited case also i.e. Surinder Singh's case (supra), what the witness had stated were the facts which were attributable to his sight or hearing or his actions. But here PW20 was the IO who merely stated his opinion about the material collected by him. There was no need for the prosecution to re- examine him.]
692. He submitted that IDFC had affirmative and negative rights also in JLD. He also contended that whether IDFC was promoter or not was not relevant for the screening committee. He referred to some clauses of the MOU in this regard.
693. He also argued that upon objection being raised by the IDFC, the presentation was corrected in the soft copy and the assertion that JLD was promoted, controlled and managed by IDFC and Lokmat group was corrected. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 250 of 405
694. He also argued that prosecution did not examine any witness to show intention of IDFC with respect to its status as per the MOU. He referred to Sec. 14 of Evidence Act in this regard. [This contention is misconceived as prosecution has examined 2 officers of IDFC who stated that information in the application form and feedback from regarding IDFC promoting, controlling and managing JLD was not correct as per the MOU].
695. Counsel argued that it was at the most a case of puffing up a note of cheating. He relied upon Ravi Somani Vs. State of Goa, 2010 SCC OnLine Bom 1710.
696. He also contended that the information in the application was provided in consultation with IDFC. He referred to testimony of DW1 Manish Rajvaidya in this regard. He relied upon the assertion of DW1 that discussion was held regarding meaning of 'Principal' and Sh. VS Rana had also confirmed the same.
697. He also pointed out that logo of IDFC was used in the presentation. Further IDFC had at least agreed to be partner of the SPV as per email of Aditya Aggarwal. He also contended that initially officers of IDFC had agreed to include the phrase 'promoted, controlled and managed by' but when the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 251 of 405 presentation was circulated internally, the other officers of IDFC probably disagreed with the said assertion and thus email was sent to mention the words 'partnering or assisting'. He submitted that no investigation was carried out by the IO in this regard. He also pointed out that there was no objection from IDFC to use of its logo in the presentation. He argued that as changes were made in the soft copy, and changes could not be made in the hard copy due to paucity of time, there was no intention to cheat on the part of accused No. 1 company. He also submitted that information about promoter was not required as per the guidelines.
698. Ld. Counsel vehemently submitted that networth of the principal could be used by the applicant company if it was an SPV/JV. He contended that prosecution was confusing the term 'promoter' with 'principal'. He submitted that even if IDFC is assumed to be not the promoter, it was certainly one of the principals of JLD. He further submitted that the term principal was not clarified or explained by MoC anywhere. He also pointed out that IDFC had intended to co-apply for the coal block. He referred to email dated 26/12/2006 [Ex. PW6/DX-1].
699. He further pointed out that IDFC had used the term 'consortium' which indicates that it was one of the principals of JLD. He argued that CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 252 of 405 networth of IDFC was used in the application as well as feedback form with the knowledge and consent of IDFC. He also referred to testimony of PW19 A.K. Kutty who has stated that networth of IDFC could be used validly.
700. The Ld. counsel thus submitted that this allegation has not been proved by the prosecution.
701. The answer of the defence regarding non-filing of MOU dt. 27.12.2006 is that there was no requirement of filing the said MOU alongwith the application form. Reference was made to the advertisement Ex. PW14/B1 in this regard. Ld. Counsel contended that as there was no such requirement of filing the MOU in case of an SPV/JV, there was no obligation to disclose any fact and there cannot be any concealment if such fact was not stated. He relied upon Amar Nath Bhattacharjee Vs. Prasenjit Kumar Bose, 2006 SCC OnLine Cal 178.
702. He forcefully referred to the evidence of IO in which he stated that nothing substantially emerged during investigation which could establish any element of cheating on the part of M/s JLD or its directors/officers. He again submitted that prosecution did not re-examine the IO in this regard.
703. He also referred to testimony of PW14 Sh. VS Rana in which he CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 253 of 405 had stated that all the documents which were required to be filed alongwith the application form had been filed with the application of JLD. He contended that witness was not declared hostile on this aspect by the prosecution.
704. He also pointed out that certificate of incorporation of JLD was annexed with the application form. Details of the directors were also annexed which included the name of Manoj Kumar Jayaswal and thus nothing was concealed.
705. Ld. Counsel for the accused persons vehemently submitted that the networth of the principals of JV/SPV could be mentioned in the application. He submitted that it was very much provided so in the guidelines. He contended that IDFC had never objected to use of its networth in the application by JLD at any point of time. He submitted that IDFC was definitely one of the principles of JLD i.e. SPV/JV. He referred to the MOU in this regard. He referred to serial No. 9 of the guidelines.
706. He denied that the role of IDFC was only that of the financial investor. He argued that there was no misrepresentation in this regard.
707. He also vehemently submitted that networth of an applicant was never a factor for consideration before the screening committee. He contended CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 254 of 405 that prosecution has also failed to prove any such requirement. He submitted that the information regarding networth did not induce the Ministry of coal. He also pointed out that financial strength report prepared by PW12 and Sh. Samiran Dutta is not traceable and hence cannot be relied against accused.
708. Ld. Counsel for the submitted that from the evidence of prosecution witnesses themselves i.e. PW3 and PW19, it has been established that IDFC was a principal of JLD and has used its networth. He contended that prosecution has not brought any material on record to explain the meaning of the term principal. Counsel referred to testimony of PW 3 in which he uses the term 'principal' for IDFC. The said portion reads as under:
" In order to establish the proposed power plant of M/s JLD Yavatmal Energy Ltd., IDFC and Lokmat Group had also got associated with the company and in this regard a memorandum of understanding was also executed between the principal entities i.e. IDFC, Lokmat Group and Abhijeet Infrastructure Ltd.. M/s JLD Yavatmal Energy Ltd. was primarily the vehicle through whom the proposed power plant was to be established."
709. He contended that the said witness was not declared hostile and was was not cross-examine by the prosecution. He referred to Shrinivas vs State of MP, AIR 1954 SC 23.
710. He referred to the cross-examination of PW19 regarding use of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 255 of 405 networth of IDFC and similar institutions. The said portion reads as under:
"I am aware that IL&FS or IDFC do associate with other companies to set up power projects in the country.
Ques Is it correct that the purpose of aforesaid association with IL&FS and IDFC is to use their financial strength by the company getting associated with them?
Ans The aforesaid issue was debated extensively in Ministry of Power in the year 2005-06 when the matters relating to establishing the Ultra Mega Power Projects (UMPP) were being considered and it was decided that the financial strength of such financial institutions could be taken into consideration provided the said financial institution had by way of a specific board resolution and agreement to participate in equity has been entered into for setting up the specific project."
711. He argued that prosecution did not re-examine this witness and it means that the said evidence was accepted. He relied upon Surinder Singh vs State (NCT of Delhi), 2014 [4] JCC 2766, and Vishwanathan Vs. State of Maharashtra, 1995 CriLJ 2571.
712. Counsel submitted that the only condition for using the networth of a financial institution was that it should have agreed to participate in the equity. He pointed out that in the project is also IDFC had agreed to have 20% equity of JLD prior to allotment of the coal block.
713. Ld. Counsel argued that fraudulent or dishonest intention must be present from the inception of the transaction. However this is not the case. He referred to Hira Lal Hari Lal Bhagwati Vs. CBI (2003) 5 SCC 257. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 256 of 405
714. Ld. counsel further submitted that the word 'promoter' is being confused with the word 'principal' by the prosecution. He submitted that the guidelines of MoC concerned only with principal and had nothing to do with promoter.
715. Counsel also submitted that use of networth of IDFC was in consonance with the decision arrived at between Bansant Lal Shaw and IDFC. He referred to evidence of DW1 Manish Rajvaidya. The Ld. Counsel pointed out that prosecution dropped an important witness namely Sachin Johari and adverse inference shall be drawn against the prosecution. He referred to Mukesh Vs. State, 2010 (2) JCC 1563.
716. In the alternative, counsel argued that IDFC had agreed to be promoter in the JV. He pointed out that IDFC had co-applied for the allocation of coal blocks. IDFC had suggested changes in the presentation. IDFC had suggested to use the word partnering. He referred to evidence of the defence witness in this regard. He also contended that evidence of a defence witness is entitled to equal treatment as given to evidence of prosecution witness. He referred Dudhnath Pandey Vs. State of UP 1981 CriLJ 618.
717. Counsel argued that officers of IDFC were present at the time of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 257 of 405 making the presentation but still they did not raise any objection to use of networth of IDFC. He contended that only on the basis of one clause in the MOU, accused persons cannot be convicted. He submitted that MOU cannot be read in piecemeal manner. He referred to Timblo Irmaos Ltd. Vs. Jorge Anibal Matos Sequeira, (1977) 3 SCC 474.
718. Counsel submitted that IDFC was not there only as financial investor but rather was to take part in management also.
719. Ld. Counsel also submitted that the networth of IDFC was separately mentioned in the application and there was no concealment. He pointed out that it was a case of joint bidding IDFC was the principal.
720. Counsel submitted that in any case, the present case is not the one where the only hypothesis that IDFC was not the principal of JLD exists. However alternative hypothesis that IDFC was one of the principals of JLD also exists.
721. Counsel also contended that it is a case of shoddy investigation as IO did not bother to ascertain the meaning of the word 'principal'. He relied upon Parminder Kaur Vs. State of Punjab (2020) 8 SCC 811. Counsel CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 258 of 405 contended that the word principal was capable of more than one interpretation and, therefore, JLD cannot be faulted with for choosing one interpretation.
722. I have considered the submissions.
723. In the application dated 12/01/2007 for allocation of coal block [Ex. PW-1/B (Colly.), D-3] submitted to the MoC, JLD claimed its networth as Rs. 2617.57 Crores. This included Rs. 2544.19 Crores networth of IDFC and Rs. 73.38 Crores networth of Lokmat Group.
724. The prosecution's case is that networth of IDFC could not be clubbed by JLD as component of its networth. The prosecution relies on MOU dt. 27.12.2006 [Ex. PW3/F] in which IDFC has categorically specified that it was only in the capacity of financial investor. Whereas the defence relies on the same document to contend that as IDFC was a part of JV/SPV, and was thus one of the principals thereof, it could use networth of IDFC also.
725. There are two witnesses from IDFC namely PW6 Aditya S. Aggarwal and PW7 Vinayak Mavinkurve and both of whom have deposed in clear terms that IDFC was never a promoter of JLD and its networth could not have been mentioned/included in the networth of JLD. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 259 of 405
726. The issue depends on interpretation of the MOU and which in turn depends upon the attending circumstances.
727. The relevant clauses of MOU dt. 21.12.2006 [Ex. PW3/F] are as under:
a) In Clause 1.5, it is stated that Abhijeet Group and Lokmat Group are desirous of forming a consortium to bid for coal block allotment and have incorporated a Special Purpose Vehicle (SPV) under the name and style of M/s JLD Yavatmal Energy Ltd.
b) Clause 1.6 states that IDFC also being at the request of Abhijeet Group and Lokmat Group, has agreed to join the consortium and also take part in the management and business of the SPV.
c) Clause 2 further talks of the share of equity holding which the parties i.e. Abhijeet Group, Lokmat Group and IDFC shall contribute. It states that Abhijeet Group/Lokmat Group/Associates/Affiliates shall be contributing 80% and IDFC/Associates/Affiliates shall be contributing 20% of the equity holding. It further states that IDFC shall not be deemed to be or treated as the promoters or sponsors of the SPV for any reason whatsoever, including for the purpose of the IPO of SPV and IDFC shall not be named as a promoter or sponsor in the prospectus or any other document relating to the IPO of the SPV.
d) Further Clause 3 talks of roles and responsibilities of the parties to the MOU and provides under Sub-Clause (ii) that IDFC shall support the coal application bid process by way of conducting an appraisal of the proposed end use project. It shall provide a letter of support/commitment for financing the project. It shall also subscribe to 20% equity of the SPV CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 260 of 405 and which at this stage shall be capped at Rs. 5 lacs and in the event of allocation of coal block to SPV, IDFC shall subscribe to 20% paid up equity of the share capital.
e) Under Clause 3 (b) (iv), the agreement further provides that IDFC shall be the financial advisor and shall carry out debt syndication/arrangement and after due diligence and corporate approvals shall also draft and finalize, financing/security documents for the project. It also states that IDFC shall charge market based fees for these services @ 0.50% of the total cost of the project.
f) Under Clause 9, the agreement further states that while the MOU shall be effective from the date of execution by the parties but shall terminate on signing of SHA (Share holding Agreement) and will have no effect thereafter. It also states that in case parties are unable to reach an agreement on the PDA and/ or SHA during the discussion period, unless extended by mutual consent of the parties, the MOU shall terminate with no liability on either party.
728. From these terms, it is amply clear that there is no provision for use of networth of IDFC by JLD.
729. The relevant emails may also be noted in some detail and which are as under:
a) "Email dated 14.06. 2007 From: Sanjay Dey to Aditya Agarwal "Dear Aditya, Please find enclosed a draft presentation for JLD coal mine allocation.
We would require your value addition on the same. To keep you informed the presentation is scheduled on 21st of this month where we would require an IDFC representative to be present. Please keep me advised on the same.
Regards"
b) Email dated 14 June 2007 From: Aditya Aggarwal to Sanjay Dey CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 261 of 405 "Thanks Sanjay. I have had a quick review of the presentation and have some minor comments. Suggest we have a meeting in our office on Monday to firm up our approach towards this important presentation and also to close out the PDA since Sachin will also be available on that day.
Abhishek, Krishnan - It will be very helpful if you could join in on Monday so that we can resolve all outstanding issues that day enabling us to take up the proposal for an internal Tuesday meeting. Regards"
c) Email dated 19.06.2007 From: Aditya Aggarwal to Krishnan P. N. "Dear Krishnan As discussed yesterday, please send us the revised presentation which is proposed to be made at the Screening Committee meeting. As was agreed during our meeting, we may need to downplay our pitch in this forum while taking care that there are no factual inaccuracies in the proposed presentation and the same is in line with the documented approvals that we have at this stage including those from IDFC.
IDFC will be represented by me and Vinayak and we would appreciate if you could also confirm the attendees from the Jayaswal and Lokmat groups.
Regards Aditya"
d) Email dated 20.06.2007, From: Dey Sanjay To:
Adit_Aggarwal Attachment : Final presentation JLD- Mah Forwarded message From: Harshad Pophali, To: Krishnan "Sir, Please find enclosed herewith as file attachment the finalized presentation & feedback form (as on 20.06.2007 time - 5.45 p.m.). With Regards Harshad"
e) Email dated 21.06.2007 From: Aditya Aggarwal To: Sanjay Dey Subject Draft presentation to the Screening committee "Dear Sanjay CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 262 of 405 Received the updated presentation copy late last night which was then circulated internally. We have two minor comments on the same as detailed below in respect of which the presentation is to be amended:
IDFC is not be specifically referred to as a promoter of the project company. It is suggested that we use words like IDFC partnering/assisting in developing the project by proposing to take up a significant equity stake.
The presentation in some places states that the Project Finance is tied up; IDFC has appraised the Project and arranged syndication of debt. We would rather suggest the following language: the arrangements for financing the project have been made; IDFC has carried out an appraisal of the proposed project and has agreed to syndicate the required debt.
Request you to amend the draft presentation as above and confirm. Regds."
f) Email dated 22.06.2007, From: Aditya To: Vinayak Mavinkurve; Vikram Limaye; MK Sinha "1. JLD Power: Presentation to the Screening Committee for coal block allocation.
It was a short & low key affair with the presentation lasting about 10 minutes. Our consortium was represented by Sanjay from Jaiswal group, Devendra Darda from Lokmat group and myself with Vinayak representing IDFC. The committee was represented by 25 odd mid level govt representatives from various concerned ministries and state govts. JLD's basic presentation pitch was that all project components are tied up except for the fuel. However one disconcerting fact was that IDFC was continued to be depicted as a co-promoter of the project despite us expressing concerns on the same. Though we did get the presentation made amended to remove such references, the printed copies which were circulated continued to carry statements to that effect. We also need to be aware of the fact that the Jaiswals have also entered into an equity arrangement with IL&FS similar to that with us for another 1215 MW project in Bihar and would also be pitching for a coal block for that project.
Had lunch with Manoj J and PNK subsequently where MJ confirmed that we should continue with our plans of coming down to Nagpur on 27th to progress the CPL deal and the JLD PDA. However PN suggested that if Jas Board meeting were to be held in Mumbai, then perhaps we could complete all this in Mumbai itself. He will revert on the same.
2 .. . . .
3 .. . . .
. . . .
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 263 of 405 Regds."
g) Email dated 26.12.2006, From: Aditya Aggarwal To:
Vikram Limaye, M.K. Sinha; Cherian Thomas; AKT Chari; Rajiv Lall; ATULYA SHARMA; Sachin Johri; Vinayak Mavinkurve; Debabrata Mukherjee Subject MOU for Coal Blocks with Ahibjeet Group "Dear All We propose to execute an MOU with Abhijeet and Lokmat Groups tomorrow to co-apply for the coal blocks in Maharashtra, Chattisgarh and develop the proposed end use 1215 MW power project in Maharashtra. The total project cost is estimated to be around 5200 crores.
The main issues which have been agreed upon and are being documented in the MOU are:
h) IDFC and its affiliates to have 20% equity stake at par.
i) IDFC shall have the exclusive right for any equity placements at 2% fees.
j) Prior to the coal block allotment, IDFC's role will comprise conducting an appraisal of the proposed end-use Project, providing a letter of support for financing the Project and subscribing to 20% of the equity capped to Rs 5 lacs prior to the allocation of coal block. All expenses and costs prior to allotment of the coal block would be borne by Abhijeet Group and Lokmat Group, save and except IDFC's contribution of Rs. 5 lakhs towards equity share capital of the SPV.
k) Post coal block allotment, IDFC, apart from its equity subscriptions shall carry out the financial advisory and debt syndication role exclusively at 0.50% fees of the total project cost.
l) Recovery all the approved development expenses incurred by all parties as a development fee at an appropriate premium [3-4 times] as a part of the Project Cost.
m) In addition, Abhijeet Group and Lokmat Group collectively shall be entitled to recover other development costs of 3% of the cost of the Project. The background and mechanism for this shall be jointly agreed between all 3 partners.
n) IDFC shall have certain affirmative and negative rights including approvals required for business and operating plans, alteration of capital structure, leveraging, asset sale, finalization of and changes in all project documents etc. In addition we have Tag Along rights and ROFR.
Regards Aditya"
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 264 of 405
730. From the email dated 21.06.2007 sent by PW6/Aditya Aggarwal, (an officer of IDFC) to PW3/Sanjay Dey, (a representative of M/s JLD), it is clear that IDFC had specifically objected to the using of its name as a promoter of the project company. In fact in the said email, it was also stated that IDFC had only agreed to syndicate the required debt and had not yet arranged syndication of debt.
731. The subsequent email dated 22.06.07 from PW6/Aditya Aggarwal to other officers of IDFC, after the presentation was made before the Screening Committee, again show that IDFC was objecting to being shown as a co-
promoter of the project despite having expressed concern in this regard. It further states that even though the presentation was got amended to remove such references but the printed copies circulated continued to carry statements to that effect.
732. At this stage, it will be also appropriate to refer to minutes of a Board meeting of IDFC held on 09.01.2007. The same read as under:
INFRASTRUCTURE DEVELOPMENT FINANCE COMPANY LIMITED DECISION BOARD MEETING Minutes of the Decision Board Meeting of Infrastructure Development Finance Company Ltd. held on 9th January, 2007 at Ramon House, 169 Backbay Reclamation, Mumbai 400 020 when the following members were present:
1. A.K.T. Chari
2. Mr. Vikram Limaye
3. Mr. M.K. Sinha CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 265 of 405
4. Mr. Sadashiv Rao Others
1. . . . . .
. . . . .
. . . . .
2. JLD Yavatmal Energy Ltd.
The DB note on the proposed (9X135 MW) coal based power project JLD Yavatmal Energy Ltd. was tabled. The project is proposed to be set up in Yavatmal district of Maharashtra by a consortium of the Lokmat Group and Abhijeet Group (together holding 80%) and IDFC (20%) participating in the capacity of a financial investor. The project will use the coal from the captive coal block mines for which the consortium is applying to the Ministry of Coal.
The Advisory group explained to the DB that as per the requirements for the allocation of the coal blocks, the coal block application requires an appraisal report by a Lender to be annexed. However, the draft Pre- feasibility Review Report (PFR) has been prepared by the Advisory Group in their capacity as Financial Advisors and does not constitute an appraisal in any form. The project is at a concept stage at this point of time and the advisory report seeks to provide a preliminary review of the project concept and is solely based on the draft Project Report made available by the Company. No independent due diligence of the project cost or other project parameters has been carried out. Therefore, the Advisory report can be termed as a pre-feasibility review report / preliminary information memorandum.
However, it was mentioned by Project Finance group that the company would want an appraisal report from IDFC to support their application for the coal blocks. The DB decided that the Advisory draft report will be forwarded to Project Finance and the same can be finalized and sent to the client as an Appraisal Report by the Project Finance group. The DB also approved the Letter of financing support that is required to be sent by IDFC to the client for the project.
DSC Proposal
1. . . . . .
. . . . .
. . . . .
2. . . . . .
. . . . .
. . . . .
. . . . .
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 266 of 405
733. The said minutes also states that IDFC is only participating in the capacity of a financial investor.
734. The witnesses from IDFC too say that IDFC was not to be a promoter of JLD. The contentions of the defence that these witnesses are unworthy of credit must be rejected as nothing is adverse against their evidence.
735. The contention of the defence that IDFC was rather a principal of SPV namely JLD is not worth acceptance. The contention that prosecution is confusing 'promoter' with 'principal' is without any basis. In my view, one cannot be a 'principal' unless it was a 'promoter' also. The promoters take steps to incorporate a company. Here the company M/s JLD Yavatmal Energy Pvt. Ltd. was incorporated only by Abhijeet Group and Lokmat Group. At that time, IDFC was not in picture. IDFC came into picture only when the MOU dt. 27.12.2006 was executed. It must be noted that the SPV was JLD which already stood incorporated on 18.12.2006. Thus IDFC cannot be called its principal. Had IDFC also been involved at the time of incorporation of JLD, then accused could claim that it was one of the principals of JLD. But this is not the fact situation.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 267 of 405
736. Reliance on testimony of DW1 Manish Rajvaidya is misconceived. His evidence is not inspiring any confidence. The claims made in his evidence have not been corroborated by any material. He has introduced Sh. B.L. Shaw on the stage just to save the accused persons.
737. It will be wrong to say that IDFC had co-applied for allocation of coal.
738. From the relevant clauses of MOU, it is apparently clear that IDFC never agreed to be promoter of the JLD. It had no intention of being referred to as promoter of JLD. Further it is against the record to say that IDFC officers did not object to use of networth of IDFC. Their stand had been that IDFC was not to be referred to as promoter.
739. The fact that IO did not investigate the meaning of principal does not affect the case of the prosecution as its meaning is simple and clear as discussed above.
740. Ld. Counsel for A-1 to A-4 referring to other clauses of the MOU submitted that IDFC had agreed to be part of management and had agreed to buy 20% equity also. According to him nothing more is required to show that IDFC was a principal of JLD.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 268 of 405
741. These contentions are worthless. No officer of IDFC was made a Director of JLD at any point of time. Nor IDFC ever purchased equity shares of JLD.
742. At the time of presentation also, the presentation was got corrected in a soft copy at behest of IDFC which only shows that it did not agree to being called promoter.
743. There is no alternative hypothesis that IDFC was one of the principals. The only hypothesis is that IDFC was never a promoter of JLD and thus never a principal.
744. Thus from the aforesaid discussion, it is clear that IDFC at no point of time agreed to be a promoter of M/s JLD. It strongly objected to it being referred to as promoter of M/s JLD at any point of time. Thus M/s JLD could not have used the networth of IDFC either in its application form or in the feedback form.
745. Reference to word 'consortium' also does not help as IDFC was not constituent of JLD at the time of its incorporation.
746. Thus there was misrepresentation regarding networth. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 269 of 405
747. Ld. Prosecutor submitted that there was misrepresentation regarding promoters of the applicant company. He submitted that it was wrongly projected that JLD was promoted, controlled and managed by Lokmat Group and IDFC. He referred to certificate of incorporation of JLD [part of Ex. PW1/C (Colly)] and contended that nowhere IDFC is mentioned.
748. Further, it was concealed that Abhijeet Group was a contituent of JLD with a purpose to hide that many coal blocks already stood allocated to other companies of the said group.
749. When Abhijeet Group has been referred to in the MOU dt. 27.12.2006, then there can be only one explanation for not mentioning it in the application and which is that it was done with intention to hide that Abhijeet Group was also part of the SPV called JLD. Obviously, this was done with object to evade scrutiny regarding previous allocations to other companies of the said group. No doubt that the previous allocation was not a disqualification but concealing it conveys something and it was to avoid scrutiny. Concealing the same only enhances the culpability of the accused persons. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 270 of 405
750. Ld. DLA is right in submitting that MoU dt. 27.12.2006 was deliberately concealed by accused persons to hide that Abhijeet Group was also promoter of JLD. The reason is obviously the same as mentioned above.
751. The contention of the defence that there was no requirement of filing the MoU as per guidelines [Ex. PW14/B1] is somewhat misdirected. It may be strictly speaking not required as per the guidelines. But what prosecution is submitting is that by not filing the same, the accused persons made sure that fact of Abhijeet Group being one of the promoters was concealed.
752. Merely by supplying the details of the directors, it cannot be said that there was no dishonest intention. The defence has not explained at all the necessity not to reveal the name of Abhijeet group. This can point to only one thing that it wanted to conceal that Abhijeet group was one of the promoters of JLD. This was also done with a view to conceal allocation of various coal blocks to other companies of Abhijeet group.
753. Thus there was mispresentation on this count also. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 271 of 405
(c). Misrepresentation regarding APPRAISAL AND SYNDICATION OF DEBT
754. Ld. DLA submitted that false information was provided by the applicant company that IDFC had appraised the project and syndicated the debt. This claim was made in the feedback form. He referred to the evidence of the PW6, PW7 as well as PW14. He also referred to the emails exchanged between officers of IDFC and those of JLD.
755. Ld. Counsel for A-1 to A-4 contended that no investigation was conducted regarding this allegation. He contended that prosecution is merely relying upon oral statement of interested witnesses who are PW6 and PW7. He argued that the allegation is baseless for the reason that IDFC was under
obligation to appraise draft project report as per the MOU. He referred to the relevant clauses of the MOU [Ex. PW-3/F] in this regard.
756. Ld. Counsel submitted that as per the decision dated 09/01/2007 of the Decision Board (DB) IDFC itself mentions that pre-feasibility review report (PFR) be finalised by the project finance group and be sent as an appraisal report to the client i.e. JLD. PW6 and 7 were project finance group. Ld. Counsel for the accused persons submitted that no investigation was made from IDFC as CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 272 of 405 to the requirement of annexing appraisal report of the project and, therefore, adverse inference should be drawn against the prosecution. He also pointed out that PW7 did not remember whether he had sent the appraisal report to JLD or not. He pointed out that both these witnesses have deposed about the changes got made in the presentation were not regarding the assertion to the effect "that the project has been appraised by IDFC and the Project appraisal report has already been submitted to the Ministry of coal". He argued that it means that there was no objection to the above statement in the presentation by IDFC.
757. He also submitted that even as per IDFC, these were minor mistakes. Counsel submitted that IDFC has admitted that it had appraised the project. He contended that absence of appraisal report is not at all an incriminating circumstance as the said report was only auxiliary to the application and did not affect the completeness of the application itself. He referred to the guidelines and contended that furnishing appraisal report was not mandatory. The only thing mandatory was to furnish project report. According to him, non-submission of appraisal report would only mean that the project had not been appraised by the lender. He referred to statement of PW14 Sh. VS Rana wherein after seeing the application and the documents, he stated that the application was complete in all respects. Counsel argued that the statement of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 273 of 405 PW14 has demolished the case of the prosecution. He also pointed out that no question was asked from the accused persons in their statements under section 313 CrPC and this shows that this circumstance was not proved by the prosecution and it has remained conjectural.
758. Counsel submitted that IDFC was responsible for syndication of the debt as per the MOU. There was provision for payment of fees towards the said services in the MOU. He referred to the email of PW6 and submitted that it was nothing but re-arrangement of the language to be incorporated in the presentation. He also pointed out that syndication and arrangement had been used interchangeably. He submitted that as a matter of fact IDFC had arranged/syndicated the debt. He argued that JLD was acting as per the directions of IDFC on financial aspects. He pointed out that no investigation was collected from Sh. P.N. Krishnan by the IO and adverse inference should be drawn against the prosecution. The stress of Ld. Counsel is on the aspect that whatever was stated in the application form regarding financial aspect was so stated on the directions of IDFC. He also submitted that no evidence has been produced to show that this information regarding syndication of debt was considered at all at any point of time by the MoC.
759. I have considered the submissions.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 274 of 405
760. The changes suggested by officers of IDFC itself show that IDFC was not agreeable to the original draft of the presentation. There was wrong statement in the draft which was sought to be corrected. While in the draft it was stated that IDFC had syndicated the debt whereas it was not so and for this reason IDFC wanted the sentence as that "IDFC had agreed to the syndicate the debt". This is sufficient to show that there was no syndication and as such it was a misrepresentation. There is no weight in the submissions that this information was not considered by the screening committee.
761. Even if PW14 has stated that the application was complete, it does not ipso facto make the application complete. It is an admitted condition that appraisal report was not annexed with the application form. When the accused persons are themselves admitting that IDFC had appraised the detailed project report, then they were required to attach the said report also. Statement of PW14 alone is not sufficient to make the application complete.
(d). Misrepresentation regarding PREVIOUS ALLOCATION
762. Ld. DLA submitted that information about allocation of various coal blocks previously to various companies of Abhijeet group was concealed CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 275 of 405 dishonestly again obtain allocation of any coal block now for JLD. He also referred to details of the earlier allocations. He submitted that JLD was a group company of Abhijeet group and various coal blocks which were allocated to other companies of the said group were not keeping up with the milestones. Ld. DLA referred to the status reports Ex. PW15/B to E. He contended that to hid this track record, previous allocations were not mentioned.
763. He thus contended that the information was concealed to mislead the MoC and Govt. of India.
764. Counsel for the accused argued that the allegation is misconceived and has remained not proved. He submitted that the position has not changed from what it was at the time of filing the closure report. He submitted that it is a case of no evidence. He pointed out that it was mentioned in the closure report that JLD was not allocated any coal block earlier and thus there was no misrepresentation in column No. 29 and 30 of the application form. He also pointed out that the purpose for which information was sought in column No. 29 and 30 of application form has remained inconclusive even after detailed investigation. It was so pointed out in the closure report itself. He contended that even after leading evidence, prosecution has failed to establish the purpose of seeking such information.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 276 of 405
765. He also submitted that information was to be given of the end user company which was JLD. He contended that reliance of prosecution on a letter dated 03/05/2013 [Ex. PW-23/A] is misconceived. Vide this letter the purpose of obtaining information in column No. 29 and 30 of the application was indicated and which was suggested to be to see the track record of an applicant company regarding previous allocations. He contended that the said letter has to be read in the context of the application form of JLD. Counsel submitted that information about track record in column No. 30 was to be given only if there was previous allocation which was to be informed in column No. 29. Here, as JLD had not been allocated any coal block previously, the information in column No. 29 and 30 was nil justifiably.
766. Ld. Counsel also argued that JLD can not be said to be group company of Abhijeet group. He referred to the evidence of DW1 and submitted that it was Sh. B.L. Shaw who was managing the affairs of the said company.
767. Alternatively, Ld. Counsel submitted that had the information been provided about previous allocation, it would have rather been beneficial to the applicant company namely JLD as it would have shown technical experience in the field.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 277 of 405
768. I have considered the submissions.
769. When in the MoU dated 27.12.2006, parties are describing themselves as Abhijeet group and Lokmat group, it does show that there were groups. Abhijeet group in the MoU was represented by Abhijeet Infrastructure Ltd. The company Abhijeet Infrastructure Ltd. was under control of A-2 Manoj Kumar Jayaswal. Prosecution has shown that in the incorporation of JLD also, A-2 was fully involved. As such M/s JLD can also be said to be company of Abhijeet group.
770. The contention of Ld. Counsel that it would have benefitted by disclosing previous allocations itself clears the air. Precisely this is what has happened. Had information been revealed in column No. 29 in respect of previous allocations, further information would have to be submitted in column No. 30 about track record. With the aim to avoid this scrutiny, information in column No. 29 was mentioned as nil although JLD was a group company of Abhijeet group and should have disclosed information about previous allocations to other companies of the said group. Though previous allocation was not a hindrance to further allocation, but there was a purpose to have information about previous allocation which was to see the track record. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 278 of 405 POINT FOR DETERMINATION NO. (d):
WHETHER THOSE MISREPRESENTATIONS INDUCED ANY PERSON?
771. Ld. DLA for CBI contended that the misrepresentations made by the accused persons A-1 to A-4 had induced the MoC and ultimately of the Govt. of India. He argued that only because of these misrepresentations, the Govt. of India was induced to issue the letter of allocation of coal block to A-1 company.
772. Ld. counsels for the accused vehemently submitted that the prosecution has miserably failed to prove inducement. They argued that no witness has been produced by the prosecution to prove that there was any inducement or anybody was induced. They referred to testimonies of various witnesses and highlighted that no witness has stated that he was induced by the misrepresentations of the accused persons.
773. Ld. Counsel also highlighted that prosecution has not proved as to who was induced by the misrepresentations. Referring to the testimonies of various witnesses examined by the prosecution, he contended that no witness has stated that he had seen the application and considered its contents. Thus there was no inducement to any person.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 279 of 405
774. He also contended that most of the members of the Screening Committee were not examined as witnesses by the prosecution to prove any inducement. Referring to the testimony of PW24 Bhaskar Khulbe, he submitted that as per this witness also no document was supplied to the members of the Screening Committee in the meeting held on 13/09/2007. He thus contended that the so-called false information or misrepresentations were not considered by the members of the Screening Committee and as such there was no inducement.
775. The Ld. counsel for A-1 to A-4 pressed into service the observations made in the case of Mir Basit Ali Khan (supra) wherein it was observed that mere exaggeration or puffing is not misrepresentation. It was further observed that unless it is shown that there is a false representation or suppression of the material facts which might render it to be fraudulent, it cannot be said that the offence of cheating has been committed.
776. Ld. counsel vehemently submitted that in the application and in the feedback form, there were various informations provided by the applicant company but prosecution has not brought any evidence to show which of the information was considered by the Screening Committee of the MoC. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 280 of 405
777. Ld. Counsel for A-5 to A-7 vehemently submitted that if prosecution is itself submitting the MoC was induced, then no case survives against accused public servants as they were also part of MoC.
778. Ld. Prosecutor rebutted these submissions. He submitted that the term 'person' includes the Govt.. He relied upon Kanumukkala Krishna Murthy vs. State of AP, decided on 23/03/1964 by Hon'ble SC.
779. I have considered the submissions.
780. Inducement like any other fact can be proved directly or through circumstantial evidence as well. After perusing the entire material on record, it cannot be said that there is no material to prove inducement.
781. It is not necessary always to examine a witness to prove inducement directly. It can be inferred from circumstances also. The emphasis of the defence on non-examination of members of Screening Committee is misplaced as one member Sh. Bhaskar Khulbe was examined as PW-24. Further, it has been established that the informations supplied by the accused persons in the application form and feedback form taken note of and compiled and considered by the Screening Committee. The informations were part of the record and it is unthinkable that nobody had seen them or read them. The CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 281 of 405 inference is that the same were indeed considered and this inference is very strong one making it an established fact. If the argument of the defence is accepted, it would mean that the Screening Committee recommended allocation of coal block without even considering the informations mentioned in the application. This is not true. The informations were considered and only then recommendation was made.
782. It has to be kept in mind that the ultimate person cheated is the Govt. of India. The inducement of the Govt. can be established from documents as well.
783. From the files relating to the coal block allocation, it is amply clear that the informations supplied by A-1 company through A-2 and A-4 were duly considered and acted upon.
784. Further it was not required of the prosecution to show which information was considered and which was not considered. Only the cumulative effect was to be shown which prosecution has clearly shown.
785. Regarding deception, counsel contended that the entire case is based on difference of understanding of accused persons and CBI. He contended that the accused persons had their own understanding of the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 282 of 405 information that was being supplied in the application form and feedback form. Whereas the CBI understood those informations in their own perspective. He also submitted that there was no deception as well because the application of JLD was not processed in the Ministry of coal but was forwarded to other authorities; the recommendations sent by these authorities were not considered by the Screening Committee as it chose to get the information verified from the state Govt.; and further the information sent by the state Govt. was also not considered by the Screening Committee.
786. There is no force in these contentions. It cannot be said that the application was not processed in MoC. After all, it was MoC which had issued letter of allocation. It is noteworthy that what was sent to MoP was copy of the applications and its comments were called. Similarly, another copy was sent to Govt. of Maharashtra and Chhattisgarh for its comments. It was sort of assistance which MoC demanded from MoP and Govt. of Maharashtra and Chhattisgarh. The accused A-1 company earned recommendation from MoP and Govt. of Maharashtra for Fatehpur East coal block. Govt. Of Chhattisgarh did not make any recommendation in favour of A-1 company. These recommendations were given on the basis of the informations provided in the application, feedback form and other correspondence. There is no doubt about CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 283 of 405 this fact situation. It cannot be said that these informations did not influence the MoP or the Govt. of Maharashtra who were assisting MoC, Govt. of India and were in a relationship resembling that of principal and agent. It is settled law that inducement of agent is inducement of principal.
787. After perusing Kanumukkala's case (supra), it is clear that MoC, Govt. of India can be considered as 'person' deceived.
788. Thus it is held that prosecution has established that there was inducement. It has established that Screening Committee, MoC and Govt. of India were induced to issue the allocation letter.
POINT FOR DETERMINATION NO. (e):
WHO IS RESPONSIBLE FOR MAKING THOSE MISREPRESENTATIONS AND THEREBY DECEIVING AND THEREBY FRAUDULENTLY OR DISHONESTLY INDUCING THE SAID PERSON?
789. Sh. A.P. Singh, Ld. DLA for the CBI submitted that it has come in evidence that it was A-2 Manoj Kumar Jayaswal on whose instruction the application form was filled up. Further, it was A-2 on whose instructions feedback form was also filled up. He pointed out that A-4 Devender Darda had signed the feedback form and made presentation also. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 284 of 405
790. Referring to various letters written by A-3 Vijay Darda to PMO and Govt. of Maharashtra and other authorities, he contended that A-3 was also responsible for making misrepresentations.
791. Thus, according to Ld. DLA, all the four accused are responsible for making the mispresentations and inducing the Screening Committee, the MoC and the Govt. of India to allocate coal block.
792. Ld. Counsel for the accused persons, however, refuted these submissions. Referring to section 14 of Evidence Act, Ld. counsel argued that the prosecution has not proved any intention on the part of accused persons. He submitted that prosecution has merely relied upon signing of the documents by the accused A-4 and letters by A-3 and has not thrown any light as to under what circumstances these documents/letters were signed by them. Counsel emphasised that accused persons had no knowledge that the representations made in these documents/letters were false.
793. The counsel for the accused submitted that the allegations have not been proved against accused No. 2. He submitted that accused No. 1 company was incorporated to provide electricity to the state of Maharashtra which was facing acute shortage. The Yavatmal district was itself facing high CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 285 of 405 rate of farmers suicide due to poverty and agrarian stress. In the circumstances accused No. 1 company applied for the coal block. Lahora west coal block which was at a distance of 50 km was the 1 st party of the company. However Fatehpur East coal block was allocated by MoC. He pointed out that on 31/03/2008, a family settlement Ex. PW3/N was executed between members of the BLS family and whereby JLD was recognised as a company of BLS group.
794. Ld. Counsel took up the plea that accused No. 2 was not responsible for looking after the affairs of accused No. 1 company. He submitted that accused No. 2 has not signed any document or any communication on behalf of accused No. 1 company; that accused No. 2 did not attend any decision making meeting of the company; that accused No. 2 was never part of any decision-making process; that he did not attend any board meeting; and that no communication was marked to him at any point of time. He contended that the CBI is merely relying upon the fact that accused No. 2 was a director in the accused No. 1 company. He argued that case of the prosecution against accused No. 2 is based upon unreliable testimonies of interested witnesses. He pointed out that prosecution has dropped many crucial witnesses who could prove involvement of accused No. 2 and dropping them must lead to adverse inference. He referred to testimony of DW1 Vaneesh CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 286 of 405 extensively. He submitted that from his evidence it has been shown that accused No. 2 was not controlling the affairs of of accused No. 1 company and rather it was his father Sh. B.L. Shaw. He submitted that it was Sh. B.L. Shaw, Sh. A.B.P. Kesan and DW1 who was looking after the work of coal block allocation on behalf of various companies of the BLS group.
795. He contended that Abhijeet group was nothing more than a corporate veil worn by the BLS family and control of the companies in reality remained with Sh. B.L. Shaw himself. Ld. Counsel contended that Sh. B.L. Shaw was the officer in default for the accused No. 1 company though he was not a director therein. He referred to section 2(30) of the Companies Act 1956 in this regard. Counsel argued that IO did not investigate these aspects properly.
796. Ld. Counsel asserted Sh. B.L. Shaw did not trust any of his three sons. He submitted that Sh. B.L. Shaw used to consider accused No. 2 as a very incompetent and irresponsible person because of his flamboyant nature and thus had restricted role of accused No. 2 to only look after HR related issues of the companies, passing of the bills etc.
797. Ld. Counsel vehemently argued that prosecution is relying upon hearsay evidence to show that accused No. 2 was responsible for preparation of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 287 of 405 application form and feedback form. He referred to evidence of PW2 Sh. Harshad Pophali and submitted that same is only hearsay evidence. He referred to evidence of other witnesses also and submitted that they were untrustworthy.
798. Regarding PW 1 Vinay Taneja, he submitted that he had signed the application form and is falsely stating that he had signed without even looking at the annexures. Counsel argued that this conduct is against normal human conduct. Similarly, regarding PW 2 Harshad Pophali submitted that he had personal enmity with accused No. 2 and he had filed winding up petition against another company of accused No. 2. Counsel submitted that despite being involved in the preparation of the application form and feedback form and the presentation, he has been made a witness instead of an accused. In respect of PW 3 Sanjay Dey, counsel submitted that this witness was himself involved in discussions about formation of MOU and presentation etc. and he was the signatory on the MOU. He contended that his testimony is uncorroborated and as such cannot be relied upon. About evidence of PW6 Aditya S. Aggarwal and PW7 Vinayak Mavinkurve, counsel submitted that both these witnesses have deposed only for the purpose to save IDFC and themselves from prosecution.
799. Another argument of Ld. Counsel is that the defence of the accused No. 2 under section 313(5) Cr PC was not dealt with by the prosecution. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 288 of 405
800. He also contended that accused No. 2 cannot be held liable for the offence committed by accused No. 1 company as there is no concept of vicarious liability in criminal law.
801. Ld. defence counsel submitted that no case is made out against accused A-3 Vijay Darda. He pointed out that the letters/recommendations written by accused Vijay Darda were for the coal block Lohara West and Extension and not for Fatehpur East. As such there was no inducement. He also pointed out that the letter/recommendations of accused Vijay Darda were never considered by the Screening Committee. As such there was no question of any inducement of any member the Screening Committee. According to Ld. Counsel accused Vijay Darda had written the said letters/recommendations as member of Parliament and because he wanted development of his constituency i.e. Yavatmal district which was very poor district. There was extreme poverty in his constituency and establishment of power plant would have provided jobs to the villagers. Ld. Counsel submitted that accused Vijay Darda had no role in providing/filling up the information in the application form or the feedback form or the presentation. He referred to the testimony of DW1 Manish Rajvaidya. Counsel also contended that there was no falsity in the letters written by accused Vijay Darda. He submitted that IDFC was agreeable to use of its CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 289 of 405 networth. He contended that prosecution has not brought any evidence to show that Abhijeet group was promoter of JLD. He submitted that accused Vijay Darda did not influence any authority. He also pointed out that ultimately coal block which was allocated was Fatehpur East and that too jointly. He submitted that Lohara West and Extension was the 1st priority whereas Fatehpur East was the 5th priority. He referred to letter of Minister of State for Coal dated 30/01/2008 (Ex. PW14/L-12) in this regard and in which it was conveyed to Govt. of Maharashtra that they would follow recommendations of Screening Committee only. Counsel also made reference to an affidavit of Sh. VS Rana filed in connection with the proceedings in Hon'ble High Court of Delhi. In the said reply reference was made to the letter of one Sh. Subodh Kant Sahai which was in support of a company in connection with another coal block and Sh. VS Rana stated that such letters were routinely received but had nothing to do with selection and recommendation by the screening committee. Ld. Counsel for the accused thus was to draw parallel with the said assertion and wanted to convey that letters of accused Vijay Darda were also of no value.
802. Counsel for the accused contended that accused Devender Darda was never involved in the process of preparation of the application form. He submitted that accused Devender Darda was also not involved in the preparation CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 290 of 405 of feedback form or the presentation. He never participated in any discussion in this respect. He contended that reliance of the prosecution on a letter dated 09/01/2007 is misplaced. He contended that there is nothing in the said letter which helps the prosecution in any manner. He expressed surprise that no investigation has been conducted with respect to this letter as to how it was addressed to accused Devender Darda or whether it was received by him or not. He asserted that adverse inference needs to be drawn against the prosecution.
803. Ld. counsel submitted that accused Devender Darda had only signed the already prepared feedback form. He referred to some emails exchanged between officials of IDFC and JLD. He pointed out that accused Devender Darda was no where involved in the said communication exchange. He submitted that accused Devender Darda had no knowledge or guilty intention. He submitted that the presentation was prepared by Sanjay Dey and approved by the officials of IDFC. He also referred to the testimony of defence witness DW1 and submitted that the said witness has explained that accused Devender Darda was not involved in the preparation of the feedback form and presentation. DW1 had deposed that the feedback form was to be signed by Sh. Sanjay Dey. Later it was to be signed by Sh. Rishi Darda. But Sh. Rishi had not come and thus it was signed by accused Devender Darda. Counsel also CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 291 of 405 highlighted that there has been no investigation by the IO as to who had attended the meeting of the screening committee and under whose signature the feedback form was submitted. Counsel contended that it was the responsibility of PW 3 Sh. Sanjay Dey to sign the feedback form but now he is putting the burden on the accused. Counsel also argued that evidence of PW 3 is not reliable.
804. Ld. Counsel also argued that defence stated by accused Devender Darda in his statement under section 313 Cr.P.C. as well as 313 (5) Cr PC has not been rebutted by the prosecution. He contended that merely signing the feedback form means nothing. He criticised the reliance placed by the prosecution on the case titled Grasim industries (supra).
805. Ld. Counsel also argued that for the offence committed by the company, accused Devender Darda cannot be held liable as there is no concept of vicarious liability in criminal law.
806. The Ld. counsel referred to section 313 Cr.P.C. and submitted that the accused persons A-1 to A-4 in their defence had stated that the application form and the feedback form were prepared on instructions of Sh. B.L. Shaw. He contended that the prosecution did not rebut this plea of the accused persons. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 292 of 405 Counsel contended that A-2 has not signed any document at all. He submitted that A-4 had to sign the feedback form due to sudden unavailability of Sh. Rishi Darda. He extensively referred to testimony of DW1 and contended that the same remained unrebutted. According to the Ld. counsel, the prosecution did not re-examine various prosecution witnesses and thus accepted the cross examinations.
807. Ld. counsel for the accused submitted that the application form and the feedback form were got prepared under guidance of IDFC officers.
808. Ld. Counsel pointed out that there has been no investigation on various aspects. He vehemently submitted that prosecution has not proved that there was any knowledge on the part of any of the accused that the contents were false. He stressed that the prosecution focused only on the falsity in the statements/representations without making any attempt to prove the other ingredients. He submitted that there was no investigation regarding the circumstances under which the application, the feedback form, and the other letters were drafted. Further, there was no investigation as to who was controlling the day-to-day affairs of JLD. According to Ld. Counsel, the defence showed the same and proved that it was Sh. B.L. Shaw who was controlling the same.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 293 of 405
809. He also vehemently argued that to his utmost surprise, there was no re-examination of the IO by the prosecution in the case. This fact itself declares that there was no investigation by the IO at all in this case thus the Prosecution also has no case against accused persons.
810. He next argued that the accused persons A-2 to A-4 have been charged for only being Directors of the Accused No. 1 Company but there is no concept of vicarious liability under the criminal jurisprudence.
811. In this regard, he relied upon a decision by the Hon'ble High Court of Delhi in matter titled as GIRDHIR LAL MOHTA Vs. CBI 2013(4) JCC 2649. It was observed that:
"13. Since there is no deeming provision in the Indian Penal Code creating deemed criminal liability, as in Section 141 of the Negotiable Instruments Act, therefore, finding returned in the impugned order of petitioners being liable to be prosecuted for the offences in question by virtue of being incharge of and responsible for the conduct of the business of the company and summoning of petitioners as additional accused, is rendered unsustainable.
14. This Court is conscious of the fact that petitioners have been summoned as additional accused with the aid of Section 120B of the IPC and that direct evidence of conspiracy is seldom available. However, to infer that petitioners had the knowledge of submission of application dated12th January, 2007 or of their approving submission of aforesaid application along with forged document, there has to be some material on record on the basis of which it can be so inferred. It was neither pointed out during the course of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 294 of 405 hearing, nor upon scanning of charge sheet and supplementary chargesheet, it can be reasonably inferred that petitioners had the knowledge of submission of application dated12th January, 2007 with forged documents or they had approved it.
15. There has to be legitimate basis to draw inferences of petitioners having conspired to commit the offences in question. Attention of this Court was also not drawn by learned Special Prosecutor for respondent-CBI to any Board Resolution of accused company on record or for that matter, to any material on record, to justify the conclusion in the impugned order of petitioners having knowledge of submission of application dated 12th January, 2007 alongwith forged documents or of their approving it. Thus, finding returned in the impugned order of petitioners having knowledge about application dated 12th January, 2007 being submitted with forged documents or of their approving it cannot be sustained."
812. He further referred to Maksud Saiyed versus State of Gujarat &Ors. (2007 V A.D. (Cr.) SC 277) where it has been held that:
"Where a jurisdiction is exercised on a compliant petition filed in terms of Section 156(3) or section 200 of the code of Criminal Procedure, the Magistrate is required to apply his mind. Indian Penal code does not contain any provision for attaching vicarious liability on the part of the Directors of the Company when accused is the Company. The learned Magistrate failed to pose unto himself the correct question viz. as to whether the complaint petition, even if given face value and taken to be correct in its entirety, would lead to the conclusion that the respondents herein were personally liable for any offence. The bank is a body corporate. Vicarious liability of the Director would arise provided any provision exists in that behalf in the statute. Statutes indisputably must contain provision fixing such vicarious liability. Even for the said purpose, itis obligatory on the part of the complainant to make requisite allegations which would attract the provisions constituting vicarious liability."
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 295 of 405
813. And also to C. Parthasarthy versus Bulls and Bears (Stock Brokers) Ltd, 2013 (2) AD (DELHI) 130, in which it was held that:
17. There is no dispute about the fact that the company is a juristic person and can be sued and can sue also. It can be an accused also. Section 305 of the Cr.P.C clearly lays down that when a company is an accused, it has to be made as an accused through its CMD or a Company Secretary or Chief Executive Officer but nevertheless the accused remains the company and not the CMD in its individual capacity. While as in the instant case, the respondent/complainant has sought to prosecute the CMD of both these companies as individuals as if they are vicariously liable for the acts of the company. This cannot be permitted to be done. The Supreme Court in Maksud Saiyed's case(supra) has reiterated this very point that unless and until there is a specific provision in the statute which fastens vicarious liability on the principle officer of the company, he cannot be held liable and admittedly, under the IPC, there is no provision which would make the CMD or a principle officer of a company vicariously liable for an offence of cheating, breach of trust, forgery or using forged documents as genuine. Therefore, on this point, the complaint of the respondent/complainant deserves to be quashed."
814. And further to Ashok Sikka and Ors. Vs. State, 2008 II AD (Cr.) (DHC) 143, wherein it was held that:
"11. In Maksud Saiyed (supra) the law pertaining to the liability of the individual director under the IPC for the offences committed by the Supreme Court in the following manner.
12. Where a jurisdiction is exercised on a complaint petition filed in terms of Section 156(3) or Section 200 of the code of Criminal Procedure, the Magistrate is required to apply his mind. Indian Penal Code does not contain any provision for attaching vicarious liability on the part of the Managing Director or the Directors of the Company when the accused is the Company. The learned Magistrate failed to pose unto himself the correct question viz. as to CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 296 of 405 whether the complaint petition, even if given face value and taken to be correct in its entirely, would lead to the conclusion that the respondents herein were personally liable for any offence. The Bank is a body corporate. Vicarious liability of the managing Director and Director would arise provided any provision exists in that behalf in the statute. Statutes indisputably must contain provision fixing such vicarious liabilities. Even for the said purpose, it is obligatory on the part of the complainant to make requisite allegation which would attract the provisions constituting vicarious liability.
13. One of the factors relied upon by the prosecution in Maksud Saiyed to hold the Directors liable was that they had signed the prospectus. The Supreme Court observed that this by itself was not sufficient and held that ".... Throughout the complaint petition, no allegation had been made as against any of the respondents herein that they had anything to deal with personally either in discharge of their statutory or official duty." The Supreme Court proceeded to affirm the view expressed by the High Court that no criminal liability would be attached in those circumstances."
815. And lastly to S.K. Alagh Vs State of U P 2008(5) SCC662 wherein it was held:
"Vicarious liability - Code does not cast vicarious liability on a party not directly charged for commission of an offence, unless specifically provided therefore."
816. Regarding vicarious liability, Ld. DLA referred to the case of Sunil Bharti Mittal vs. CBI, (2015) 4 SCC 609.
817. I have considered the submissions.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 297 of 405
818. The signing of document is enough to fix responsibility. If the person who has signed the document refuses to take responsibility for signing the document, then the whole criminal justice system will collapse. What is of importance is that the accused persons are not taking plea of fraud in obtaining their signature on the documents but rather are putting the responsibility or burden on Sh. B.L. Shaw and IDFC officers. They are pleading that Sh. B.L. Shaw was co-ordinating with officers of IDFC and it was he who was running the show. Such a plea is not acceptable. The accused persons just want to wriggle out of their responsibility. The signing of the documents was enough to fix responsiblity. The prosecution has fully established the intention of the accused persons.
819. Accused Vijay Darda had written various letters. Ld. Counsel contended that those letters were not considered by the Screening Committee. However, there is noting in file Ex. PW14/L1 (Colly) dated 26.07.2010 whereby correspondence from PMO was received alongwith letter of Vijay Darda. As such there is no force in this submission.
820. However Ld. Counsel is forgetting that accused Vijay Darda was a director in JLD and thus had a vested interest in writing those letters. Letters written by Vijay Darda cannot be termed merely recommendatory letters. Rather CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 298 of 405 they were written to achieve the object of the conspiracy. There is no doubt that the letters were written for allocation of Lohara West and extension coal block, however, it does not mean that the said letter had no relevance.
821. He also submitted that Fatehpur East coal block was not the priority for A-1 company and therefore letters of Vijay Darda were of no effect.
822. This contention is also without force. In the application itself, Fatehpur East was mentioned as coal block whose allocation was sought. Vijay Darda also wrote letters after allocation of Fatehpur East coal block for changing it to Lohara West and Extension block.
823. Accused Devendra Darda had made presentation and had also signed the feedback form. He cannot escape the liability.
824. The reliance on statements u/s 313 CrPC is not enough. Some positive evidence was required on this aspect. Evidence of DW-1 is also not enough as his testimony has been demolished through cross-examination. The accused persons have taken shelter behind name of Sh. B.L. Shaw. However, they did not produce him as a witness.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 299 of 405
825. The emphasis of Ld. Counsel for the accused persons on the aspect that no suggestion was given to DW-1 during his cross-examination and thus his testimony must be accepted is misconceived becaused it is not that every line and every word is to be rebutted by giving suggestions. It is enough if the opposite side - the prosecution herein - gives suggestions to rebut the core of the evidence of a witness - DW-1 herein. If we peruse the cross-examination of DW-1, it would be revealed the Ld. DLA had given necessary suggestions to him to deny core of his testimony.
826. Moreover, it is not as if whatever is said by a witness which is not rebutted by giving suggestion that it would be accepted as true. The court will be within its powers to reject the said evidence if it is inherently improbable, incoherent and weak evidence or evidence without any weight. Viewed thus, the testimony of DW-1 stood demolished by cross-examination and it was inherently improbable, incoherent and weak testimony.
827. Evidence of DW-1 is not of any assistance for the defence. His deposition mainly consists of mere assertions without any real basis. If evidence of DW-1 is accepted, it will become impossible to fix responsibility of a person who has signed a document. According to DW-1, whoever has signed the documents did so at behest of another i.e. Sh. B.L. Shaw. Such type of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 300 of 405 testimony is to be discarded in toto. Reference may be made to Grasim Industries Ltd. & Ors. Vs. Agarwal Steel, MANU/SC/1763/2009 and Jose Mathew & Ors. Vs. James Avirah & Ors., MANU/KE/0112/2016. In Grasim's case (supra), it was observed as under:
"5. In our opinion, when a person signs a document, there is presumption, unless there is proof of force or fraud, that he has read the document properly and understood it and only then he has affixed his signature thereon, otherwise no signature on a document can never be accepted. In particular, businessmen, being careful people (since their money is involed) would have ordinarily read and understood a document before signing it. Hence the presumption would be even stronger in their case. ....."
828. Ld. Counsel submitted that by this logic PW/1 Vinay Taneja should also be an accused as he had signed the application form. And A-2 should not be an accused as he had not signed any document.
829. I find no substance in these submissions. It is DW-1 himself who had stated that Sh. Vinay Taneja was selected randomly to sign the application form. This is sufficient to show non-involvement of PW-1 Sh. Vinay Taneja.
830. The reliance of Ld. Counsel on Section 2(30) of the Companies Act is misconceived. The said provision provides that 'officer' includes any director, manager or secretary or any person in accordance with whose directions or CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 301 of 405 instructions the Board of Directors or anyone or more of the directors is or are accustomed to act. The defence has not been able to establish that Board of Directors or any of the directors were so accustomed to act on instructions of Sh. B.L. Shaw. Evidence of DW-1 is quite deficient in this regard.
831. As far as A-2 is concerned, he was a Director of the A-1 company. Prosecution has established that A-2 was instrumental in getting application prepared as well as feedback form prepared. He took active interest in the whole process.
832. As far as vicarious liability is concerned, it must be observed that A-2, A-3 and A-4 have played active role in the whole transaction. The prosecution need not take help of principle of vicarious liability. Thus these contentions are also rejected.
833. It is concluded that A-1 (accused company), A-2, A-3 and A-4 (all Directors) all are responsible for making the misrepresentations and thereby deceiving and dishonestly inducing the MoC and the Govt. of India. POINT FOR DETERMINATION NO. (f):
WHETHER THE OFFENCE OF CHEATING IS MADE OUT AGAINST A-1 TO A-4?
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 302 of 405
834. The present case relates to offence of cheating. Various submissions were made about the contours of the offence of cheating.
835. Ld. Counsel for the accused persons made various submissions which can be grouped as follows:
a) Ld. Counsel contended that the fraudulent or dishonest intention must be shown to be existing right at the beginning of the transaction. He submitted that there was no such intention in this case. He relied upon:
i) Hira Lal Hari Lal Bhagwati v. CBI [(2003) 5 SCC 257:
"40. It is settled law, by a catena of decisions, that for establishing the offence of cheating, the complainant is required to show that the accused had fraudulent or dishonest intention at the time of making promise or representation. From his making failure to keep promise subsequently, such a culpable intention right at the beginning that is at the time when the promise was made cannot be presumed. It is seen from the records that the exemption certificate contained necessary conditions which were required to be complied with after importation of the machine. Since the GCS could not comply with it, therefore, it rightly paid the necessary duties without taking advantage of the exemption certificate. The conduct of the GCS clearly indicates that there was no fraudulent or dishonest intention of either the GCS or the appellants in their capacities as office-bearers right at the time of making application for exemption."
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 303 of 405
i) Amar Nath Bhattacharjee v. Prasenjit Kumar Bose, 2006 SCC OnLine Cal 178:
"8. Furthermore, to robe an accused with the offence of cheating, fraudulent or dishonest intention must have to be shown right at the beginning of the transaction. Here, it transpires from the evidence of P.W. 1 that the agreement for sale was executed about 1½ years back (on 24.09.85) from the date of, registration of the sale deed. A conceal merit of fact cannot be said to be dishonest unless the accused was under an obligation to disclose the facts concealed. There is no obligation on the seller to disclose any defect unless it is a defect which the buyer could not with ordinary care discover. The doctrine is known as caveat emptor i.e. "Let the buyer beware".
... ... Therefore, as the petitioner had no legal obligation to disclose the patent defect which the buyer could with ordinary care discover, it did not amount to cheating.
9. In the premises, in the light of the above discussion, the prosecution cannot be held to have brought home the charge against the petitioner beyond all reasonable doubts, and accordingly the present application be allowed."
b) He further argued that development of intention later on does not amount to cheating. He referred to Vesa Holdings (P) Ltd. v. State of Kerala (2015) 8 SCC 293, and the following observations:
"12. From the decisions cited by the appellant, the settled proposition of law is that every breach of contract would not give rise to an offence of cheating and only in those cases breach of contract would amount to cheating where there was any deception played at the very inception.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 304 of 405 If the intention to cheat has developed later on, the same cannot amount to cheating. In other words for the purpose of constituting an offence of cheating, the complainant is required to show that the accused had fraudulent or dishonest intention at the time of making promise or representation. Even in a case where allegations are made in regard to failure on the part of the accused to keep his promise, in the absence of a culpable intention at the time of making initial promise being absent, no offence under Section 420 of the Penal Code, 1860 can be said to have been made out."
c) He further put forth that prosecution has to prove dishonest inducement which they have failed to prove in the present case. He relied upon:
i) R. Kalyani v. Janak C. Mehta [(2009) 1 SCC 516:
29. ... As there had never been any interaction between the appellant and them, the question of any representation which is one of the main ingredients for constituting an offence of cheating, as contained in Section 415 of the Penal Code, did not and could not arise.
i) Jageshwar Singh Rastogi v. State of M.P., 1980 Supp SCC 179:
This appeal is by special leave against the judgment of the High Court of Madhya Pradesh in Criminal Appeal No. 332 of 1971 convicting the appellant under Section 420 IPC and Section 5(1)(d) of the Prevention of Corruption Act sentencing him to one year's RI and a fine of Rs 200 and six months' RI respectively. The appellant is the Principal of Basic Institute, Raisen. Sahariya, PW 12, was Divisional Forest Officer, Raisen. He wanted to purchase a Binocular for his department. He had a talk with the appellant about the Binocular. The CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 305 of 405 appellant told PW 12 that he had purchased a Binocular for his Institute and he will get the quotations for Sahariya also. Several quotations Exs. P-2, P-3 and P-4 were received on March 28, from Surender Brothers. Another quotation was received from another firm Kumar Bros. An order Ex. 5 was placed for the purchase of Binoculars to Surender Brothers. On March 31, 1964 the appellant met Sahariya and gave him the Binocular, Article B and also the quotation, Ex.
P-6 and the bill P-7. A cheque Ex. P-8 was issued in favour of Surender Brothers and the amount was received by one 'J. Singh' who is the partner of Surender Brothers. The case of the prosecution is that the appellant cheated Sahariya by making a representation that Surender Brothers was a firm dealing with Binoculars and that the price quoted was the proper one as he had himself purchased for the Institute. It is conceded and the High Court has found, that it has not specifically stated as to what profit the appellant made in the deal. The High Court found that the price of the Binocular which was supplied at Rs 586.00, is not the proper price. As another Binocular had been supplied at Rs 380 to the Institute, the High Court came to the conclusion that the appellant must have had at least normal dealer's profit. We are unable to agree with this reasoning and, the conclusion arrived at. The evidence of PW 10, Professor Srivastava, who examined the Binoculars and gave his opinion of Ex. P-15, has pointed out that the casing in Article B which is supplied to Sahariya, PW 12, was of Brass while that supplied to the Institute in Article A of Aluminium. Another difference was that there was Chromatic defect in Article A, whereas there was no such defect in Article B, Article A was made in Japan while Article B does not show the name of the country of its make. There are CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 306 of 405 differences between Articles A and B and it would be hazardous to say that the price paid by Sahariya was more than the market price.
The High Court has also not found that the prosecution has succeeded in proving that Sahariya was induced to pay higher price than the worth of the article. In the circumstances, the prosecution has not succeeded in establishing the offence of cheating.
i) Dr Sharma's Nursing Home v. Delhi Admn., (1998) 8 SCC 745
3. We have carefully gone through the complaint, the documents annexed thereto and the deposition of the complainant. On a perusal thereof, we are unable to hold that a prima facie case under Section 420 IPC has been made out. From the judgments of the Additional Sessions Judge and the High Court, we find that both the learned courts have rested their findings on deception only and did not go into the question whether the complaint and its accompaniments disclosed the other essential ingredient of the offence under Section 420 IPC, namely, dishonest inducement. "Dishonesty" has been defined in Section 24 IPC to mean deliberate intention to cause wrongful gain or wrongful loss; and when with such intention, deception is practised and delivery of property is induced then the offence under Section 420 IPC can be said to have been committed. Judged in that context, we find that there are no materials from which it can be said even prima facie that the appellant "dishonestly induced" the complainant to part with his money.
4. We, therefore, allow this appeal and set aside the impugned order of the Additional Sessions Judge and the High Court and restore the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 307 of 405 order of the learned Magistrate dismissing the complaint.
d) He forcefully submitted that the inducement has to be of the person concerned and not a third party. He referred to:
1. Hari Sao v. State of Bihar, (1969) 3 SCC 107:
"2. The facts about which there can be no dispute are as follows. The Appellant Shankar Sah met the Station Master of Sheonarayanpur Railway station on May 11, 1960 and produced a forwarding note for booking a consignment of dry chilies to Calcutta. A wagon was allotted to him and stabled in the shed on May 12, 1960. On the day following both the appellants came to the Station Master and the necessary allotment entry was made in the forwarding note. ... ... It was found that the wagon contained only 197 bags of chaff (Bhusa) instead of 251 bags of dry chillies. ... ...
3. There was evidence before the Sessions Judge that the appellants had obtained a sum of Rs 5500 from one Murarilal Jhunjhunwala by handing over the railway receipt to him by representing that they had booked 251 bags of chillies. The Sessions Judge held that the Station Master had not checked the goods or verified the weight thereof but had acted on the representation of the appellants. According to him the appellants were guilty of an offence under Section 420, read with Section 34 IPC and he sentenced them as already mentioned.
......
5. Under Section 415 of the Indian Penal Code a person is said to cheat when he by deceiving another person fraudulently or dishonestly induces the person so deceived to deliver any property to him, or to CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 308 of 405 consent that he shall retain any property or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit if he was not so deceived and which act or omission causes or is likely to cause damage or harm to that person in body, mind, reputation or property. There can be no doubt that the appellants had by deceiving the Station Master induced him to deliver a railway receipt which could be used as a valuable security; but assuming that the appellants thereby induced the Station Master to make out the railway receipt it will still have to be shown that the making out of the receipt was likely to cause damage or harm to the railway or the Station Master.
......
10. It appears to us that the false representation made by the appellants in obtaining the railway receipt in the form in which it was issued did not cast any additional liability on the railway and the issue of the railway receipt therefore was not likely to cause any damage or harm to the railway. No question of cheating the railway or the Station Master therefore arose in this case and the appeal must be allowed. The appellants are directed to be set at liberty. The fine, if paid, must be refunded."
2. Ram Jas v. State of UP (1970) 2 SCC 740:
"4. In the present case, the finding of fact recorded only shows that the Oath Commissioner was induced to attest the affidavit by the deception practised by the appellant in wrongly identifying a person as Govind Ram when he was in fact not Govind Ram. That act done by the Oath Commissioner of attesting the affidavit could not, however, possibly cause any damage or harm to the Oath Commissioner in body, mind, reputation or CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 309 of 405 property. The Oath Commissioner was obviously not induced to deliver any property to anybody by this wrong identification, nor was he induced to consent that any person should retain any property. Thus, the facts found did not constitute the offence of cheating at all. The conviction for an offence under Section 419, substantively or with the aid of Section 109 IPC, could only have been justified if the facts proved constituted all the ingredients of the offence of cheating. In recording the conviction, the High Court neglected to see whether all those ingredients were proved. On the face of it, though the Oath Commissioner was induced to attest the affidavit by wrong identification made by the appellant, there was no likelihood of any damage or harm to him in body, mind, reputation or property, so that the Oath Commissioner was never cheated. Clearly, therefore, the High Court fell into an error in recording the conviction of the appellant for the offence under Section 419, read with Section 109 IPC and substituting that conviction in place of the conviction for offences for which he had been punished by the trial court..."
e) He next submitted that there is no dishonest intention, if what is stated is a fact, which was also known to the persons concerned; statement may be an exaggeration or a puffing, which is not cheating. He relied upon:
i) State of M.P. v. Mir Basit Ali Khan, (1971) 2 SCC 96 (Three Judge Bench)
7. The High Court, however, held that it being not in dispute that the firm was registered and its number was 1468 there was no fraudulent or deceitful representation. The High Court further held that most of the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 310 of 405 witnesses had clearly stated that they had known the fact that it was a private firm and the Govt. had nothing to do with it. The High Court was of the view that the statement may be an exaggeration or a puffing. ...
......
......
11. The learned Counsel for the respondents contends that since the year 1939 similar schemes have been held not to fall within Section 420 IPC, and the Legislature must be deemed to have accepted the law as laid down in the cases. The learned Counsel has drawn our attention to two decisions of the Calcutta High Court on similar schemes. The earliest case pointed out by the learned Counsel is Radha Ballav Pal v. Emperor. [AIR 1939 Cal 327 : ILR 1939 Cal 872 : 43 CWN 388 : 40 Cr LJ 600] In that case the society was described as Govt.
Registered No. 5934, registered under Act 11 of 1932. The High Court held that it was not a misrepresentation as this society was actually registered under that Act. ... ... ...
......
......
It seems to us that the Calcutta cases, referred to above, were correctly decided and the High Court came to the correct conclusion.
This appeal must accordingly fail.
i) Ravi Somani v. State of Goa, 2010 SCC OnLine Bom 1710
24. If Govt. of India found that the petitioner had not violated Rule 50 of the said Rules nor had indulged in cheating where was the question of Govt. of Goa filing a complaint CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 311 of 405 against the petitioner to the Police to take suitable action to prevent circulation of fake number plates which do not bear laser branded identification number and snap lock?
Admittedly, no offence of cheating was alleged to have been committed by the petitioner, in the said complaint of Director of Transport, and interestingly no person who got cheated, if at all, had complained about such cheating. It was nobody's case that any of the buyers of the plates manufactured by the petitioner's Company were carried away by the advertisements published by the petitioner or the petitioner's Company.
Puffing of goods by advertisements are not at all uncommon and are routinely discounted by men and women exercising ordinary prudence. Otherwise, there will be a case of cheating with every dissatisfied customer. In fact, Respondent No. 1 ought to have simply filed such a complaint because no offence of cheating was disclosed and if at all anybody got cheated, such person/s had not complained about such cheating against the petitioner. ... ... The complaint dated 25-9- 2009 discloses no offence having been committed by the petitioner, and, therefore there was no question of the Police Inspector saying that he was of the view that offences under Sections 418, 420, 471 r/w 34 I.P.C.
were disclosed even before examining any of the persons who had purchased such registration number plates. An ordinary buyer is supposed to have common prudence. Every citizen is presumed to know the law.... ... ... ... ... ... ... ... ... ...
... ... If any deception has been practiced by any of his agents, it is entirely a different matter but even then customers of ordinary CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 312 of 405 prudence are expected to know the law that HSRPs can be installed only at the office of RTO and even in their case, the allegation that they were cheated, cannot be accepted.
That apart, there has been no interaction between the petitioner and those who place orders by courier or through agents. As reiterated by the Apex Court in S.V.L. Murthy v. State(CBI) Hyderabad(AIR 2009 SC 2717) referring to R. Kalyani v. Janak C. Mehta and others (2008(14) SCALE 85) there has got to be an interaction between the deceiver and the deceived and in the absence of any representation which is one of the main ingredients for constituting an offence of cheating, as contained in Section 415, I.P.C.
cheating did not and could not arise. The Court held thus:
"As there had never been any interaction between the appellant and them, the question of any representation which is one of the main ingredients for constituting an offence of cheating, as contained in Section 415 of the Penal Code, 1860, did not and could not arise".
i) Stemcor India Private Ltd. v. State of West Bengal, 2009 SCC OnLine Cal 2320
3. It has been contended in the revisional application that ... ... ... ... Mere 'puffing of the capability of the accused company, even if it has been done, cannot be termed to be false representation because extolling virtue of a company cannot be termed to be a false representation within the meaning of section 114 of the IPC. ... ...
5. Having thus placed the facts of the case and the submissions of the learned Counsel for the parties it is necessary to CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 313 of 405 consider whether the petition of complaint disclosed a cognizable offence of cheating.
... ... Paragraph 9 of the petition of complaint contains the averment that the accused company canvassed coloured and glossy prospect about the accused company of its huge span and magnitude of business and about the sincerity, honesty and strictness to their every commitment. Presentation of the glossy prospect and what is called puffing up of the capability or potentiality of the company of the accused by itself cannot be said to be fraudulent or false representation provided it does appear that there was no semblance of truthness in such representations. At the moment the Court is unable to say that the accused company did not have any necessity to canvass a coloured and glossy prospect about the accused company or that the company did not make any such canvass because it is a point of fact. But mere presentation of a very bright prospect of the accused company before the complainant by itself does not become false or fraudulent.
Ordinarily in every commercial transaction a seller/distributor would always present a very good prospect and potentiality of the company to further the business interest of the seller and presentation of the glossy prospect before a party comes into contract with the seller may not necessarily imply an element of mens rea.
Now it is not in dispute that the two contracts took place on 8th January, 2008 and 21st February, 2008. The first contract relates to delivery of certain quantum of goods within 30 days from the date of delivery order, while the second contract dated 21st February, 2008 relates to delivery of 40,000 MT of iron ore of a certain size latest by April, 2008. It goes CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 314 of 405 undisputed that both the complainant and the accused deal in the same business of iron ore.
It is not in dispute that payment of Rs. 9 crores in three installments relating to the two contracts dated 8th January, 2008 and 21st February, 2008 was made on 21st January, 2008 in relation to the first contract on 3rd March, 2008 and 7th March, 2008 with reference to the second contract. It is also not in dispute that even without receipt of the goods of first contract payment was made in respect of the second contract on 3.3.2008 and 7.3.2008. The second and third payments in relation to the second contract was made before delivery of the goods in respect of the first contract. Whether or not the rosy picture of the accused company was presented before the complainant the fact remains that the parties were acquainted with each other since before the two contracts in question took place and there had existed transaction between the parties in the month of August/September, 2007 which is prior to the contracts dated 8.1.2008 and 21.2.2008. ... ... Therefore the glossy prospect or otherwise of the accused company was know to the complainant since long before the transactions in question. ... ...
6. Though the letter dated 13th June, 2008 of the accused has not been annexed to the plaint reference to this letter in reply to the complainant's letter dated 9.6.2008 has been mentioned in the petition of complaint itself.
As Annexure-'J' to the plaint the plaintiff-
complainant offered list of assets of the accused company which shows that it has 1,37,87,500 shares in one company at New Delhi, 66,666 shares in another company in CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 315 of 405 Calcutta and 1,68,85,011 shares in a company at Bhubaneswar. In the circumstances presentation of glossy picture can hardly be said to be fraudulent or deceptive.
f) He argued that there is no evidence of any deception. He relied upon
i) State of M.P. v. Mir Basit Ali Khan, (1971) 2 SCC 96 (Three Judge Bench)
8. The High Court further observed, after referring to a number of cases which we will presently deal with:
"In this scheme as aforesaid, the purchaser also got his amount alright and one can expect to get even more provided the chain continued. As the policy with its rules and pamphlet make it quite clear, the appellants cannot be held guilty unless it is positively shown that some deception had been practised on the public with the result that they were deceived and they had paid the money.
The prosecution has not produced any witness to say that some money was due from the company and they have been in any way deceived and the amount has not been paid. It is only the Jhabua lot of witnesses who could not be paid because of the police raid and the M. Os.
being withheld by the Magistrate."
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 316 of 405
g) He further pointed out that nothing was kept secret from the policy holders. He relied upon State of M.P. v. Mir Basit Ali Khan, (1971) 2 SCC 96:
8. ... ... ... The High Court further found that the name of Mir Basit Ali Khan, proprietor, M.C.C., was mentioned simply because it was a chain scheme and that it may go on working continuously, otherwise there is every possibility that some policy holder might not send the full amount or may not be traceable for one reason or the other. The High Court observed that nothing was kept secret from the policy holders and it was known to them alright that they had joined the scheme with the conditions laid down in the policy and the pamphlet. The High Court did not think the size of the token had anything to do with cheating.
The High Court accordingly came to the conclusion that the respondents had committed no offence.
h) His another argument is that when there is no damage caused to any person, then no offence of cheating can be said to have been committed. He relied upon V. Seetharama Rao vs. Govt. of Mysore MANU/KA/0007/1954 and the following observations:
6. In this case the prosecution version is that the petitioner-accused induced the Govt.
of Mysore to pass an order that he may be allowed to buy some old pipes at the rate of six annas per loot and that he deceived the Govt. by stating that he wanted to make use of those pipes CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 317 of 405 for agricultural purposes but that he ultimately sold them. It is in evidence that these pipes are too small for being used for agricultural purposes as has been spoken to by the Expert P.W. 8. If at the time the Govt. was approached by the petitioner for permission to purchase these pipes it was represented that these pipes would be used for agricultural purposes and the Govt. gave the permission, it is clear that both the petitioner and the Govt. at that time thought that the pipes were fit for agricultural purposes. Evidently the pipes could not be used for agricultural purposes, in accused's lands or the lands of others as the pipes were later found to be not fit for being used for such purposes. It cannot therefore be said that the Govt. were deceived into passing an order in favour of the petitioner. Assuming however that there is some reason to think that the Govt. were deceived into passing an order in favour of the accused and they would not have passed such as order if the accused had not deceived them, the question that arises is whether this act of Govt.
causes or is likely to cause damage to Govt.. If any loss has incurred it is incurred by the Village Panchayathi. It is not shown that any loss was incurred at all even by the Village Panchayathi as the Mysore Iron and Steel Works, Bhadrarathi were prepared to purchase the pipes only at the rate of 0-4-9 per foot while the petitioner offered to purchase and purchased them at the rate of 0-6-0 per foot.
When the pipes had been auctioned in public auction the highest bidder was prepared to pay very much lower than what even the Mysore Iron and Steel Works, Bhadravathi were prepared to pay, it cannot be said that the act of Govt. in passing an order in favour of the accused caused or was likely to cause damage or harm to any one, still less to Govt..
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 318 of 405 Even if the evidence adduced by the prosecution is believed it is clear therefore that the accused is not guilty of the offence of cheating.
i) He next contended that there is no cheating if alternative option given. He referred to Geeta v. State of UP & Ors. 2007 CriLJ 2222 as under:
"10. ...From the definition of offence of cheating, mentioned in Section 415 IPC, it is clear that the accused should have an intention to cheat from the very inception. In the facts of the present case it is not clear that the accused had an intention to cheat from the very inception because the alternative option, which according to the complainant, was available to her was never availed off by her. Had she availed off the second option and would not have got the plot then probably it could have been said that she was cheated."
j) He next submitted that being a beneficiary does not matter.
He referred to:
1. Sheila Sebastian v. R. Jawaharaj (2018) 7 SCC 581:
28. In this case at hand, the imposter has not been found or investigated into by the officer concerned.
Nothing has been spilled on the relationship between the imposter and Respondent 1. Law is well settled with regard to the fact that however strong the suspicion may be, it cannot take the place of proof. Strong suspicion, coincidence, grave doubt cannot take the place of proof. Always a duty is cast upon the courts to ensure that suspicion does not take place of the legal proof. In this case, the trial court as well as the appellate court got carried away by the fact that accused is the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 319 of 405 beneficiary or the executant of the mortgage deed, where the prosecution miserably failed to prove the first transaction i.e. PoA as a fraudulent and forged transaction. The standard of proof in a criminal trial is proof beyond reasonable doubt because the right to personal liberty of a citizen can never be taken away by the standard of preponderance of probability.
2. State of UP v. Dr. Sanjay Singh and another 1994 Supp [2] SCC 707
19. When we scrutinise the entire material placed on record, even if unrebuked or totally accepted, we are of the view that they do not make out a case for conviction and the mere suspicion of motive cannot serve as a sufficient ground for framing the charges in the absence of any material, prima facie showing that the particular motive has passed into action and that the accused is connected with that action in question.
836. Ld. DLA while acknowledging the legal aspects of the offence of cheating refuted the contentions and submitted that the offence of cheating stands duly proved in this case. He referred to:
a) Kanumukkala Krishnamurthy @ Kaza Krishnamurthy Vs. State of Andhra Pradesh AIR 1965 - SC 333;
b) Mobarik Ali Ahmed Vs. State of Bombay; 06/09/1957 Supreme Court of India;
c) Abhayanand Mishra Vs. State of Bihar decided on 24/04/1961Supreme Court of India;
d) Chandran alias Manichan alias Manyan and others Vs. State of Kerala (2011) 5, Supreme Court cases, Page 161; and
e) State of Rajasthan Vs. Chetan Jeff (On suppression of facts) decided on 11 May, 2022, Supreme Court of India.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 320 of 405
837. He also referred to S. 24 and S. 25 of IPC which define the words "dishonestly" and "fraudulently".
838. He submitted that the said two concepts i.e. "dishonestly" and "fraudulently" have been extensively dealt with by Hon'ble Supreme Court in a number of cases. He relied upon the observations of Hon'ble Supreme Court in the well known case of Dr. Vimla Vs. Delhi Administration, AIR 1963 SC 1572 wherein the basic ingredients of the two acts have been delineated.
839. I have considered the submissions.
840. At this stage, the text of the relevant provisions are being reproduced for ready reference.
841. Section 415 of IPC reads as under:
"415. Cheating.--Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, mind, reputation or property, is said to "cheat".
Explanation.--A dishonest concealment of facts is a deception within the meaning of this section."
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 321 of 405
842. Section 420 IPC reads as under:
"420. Cheating and dishonestly inducing delivery of property.--
Whoever cheats and thereby dishonestly induces the person deceived to deliver any property to any person, or to make, alter or destroy the whole or any part of a valuable security, or anything which is signed or sealed, and which is capable of being converted into a valuable security, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine."
843. From perusal of the above-noted provisions, it is found that the ingredients of the offence of cheating are:
(i) there should be fraudulent or dishonest inducement of a person by deceiving him;
(ii) (a) the person so deceived should be induced to deliver any property to any person, or to consent that any person shall retain any property; or
(b) the person so deceived should be intentionally induced to do or omit to do anything which he would not do or omit if he were not so deceived; and
(iii) in cases covered by (ii)(b) above, the act or omission CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 322 of 405 should be one which causes or is likely to cause damage or harm to the person induced in body, mind, reputation or property.
(As held in Ram Jas v. State of UP (1970) 2 SCC 740)
844. It will also be fruitful to note definitions of 'dishonestly' and 'fraudulently'. Fraudulently has been defined under S. 25 IPC as under:
25. "Fraudulently".--A person is said to do a thing fraudulently if he does that thing with intent to defraud but not otherwise.
845. Dishonestly has been defined under S. 25 IPC as under:
24. "Dishonestly".--Whoever does anything with the intention of causing wrongful gain to one person or wrongful loss to another person, is said to do that thing "dishonestly".
846. What is wrongful gain and wrongful loss are provided in S. 23 IPC. as under:
23. "Wrongful gain".--"Wrongful gain" is gain by unlawful means of property to which the person gaining is not legally entitled.
"Wrongful loss".--"Wrongful loss" is the loss by unlawful means of property to which the person losing it is legally entitled.
Gaining wrongfully, losing wrongfully.--A person is said to gain wrongfully when such person retains wrongfully, as well as when such person acquires wrongfully. A person is said to lose wrongfully when such person is wrongfully kept out of any property, as well as when such person is wrongfully deprived of property.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 323 of 405
847. What is the meaning of the phrase "deceiving any person" as used in the definition of cheating as provided in Section 415 IPC.
848. In the case of Swami Dhirendra Brahamchari Vs. Shailendra Bhushan, 1995 Cr. L.J. 1810 (Delhi), Hon'ble Delhi High Court while dealing with the word deceiving as used in S. 415 IPC, observed that generally speaking "deceiving" is to lead into error by causing a person to believe what is false or to disbelieve what is true and such deception may be by words or by conduct. A fraudulent representation can be made directly or indirectly.
849. Hon'ble Allahabad High Court in the case of P.M. Natrajan Vs. Krishna Chandra Gupta, 1975 Cr. L.J. 899 (All.) explained the word "deceive" as indicating inculcating of one so that he takes the false as true, the unreal as existent, the spurious as genuine.
850. Hon'ble Supreme Court in the case of Ellerman & Bucknall Steamship Co. Ltd. vs Sha Misrimal Bherajee, AIR 1966 SC 1892, explained "deceit" as a false statement of a fact made by a person knowingly or recklessly with the intent that it shall be acted upon by another who does act upon it and thereby suffers damage.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 324 of 405
851. Thus, it is clear that in all such cases of deception, the object of the deceiver is fraudulent. He intends to acquire or retain wrongful possession of that to which some other person has a better claim. So, where a person parts away with a property while acting on such a representation of an accused believing in the truth thereof, it clearly amounts to deceiving the person. However, it is also important that the person practicing the deceit knows or has reason to believe the said representation to be false. Though in the true nature of things, it is not always possible to prove dishonest intention by direct evidence. It can be, however, proved by number of circumstances only from which a reasonable inference can be drawn. Further the explanation to Section 415 IPC i.e. cheating states that a dishonest concealment of facts is a deception within the meaning of this section.
852. Deception is not defined under Indian Penal Code. However, it is now well settled through various decisions that a person deceives another when he causes that another to believe what is false or misleading as to a matter of fact, or leads him into error. A willful misrepresentation of a definite fact with intent to defraud constitutes an offence of cheating. Further, it is not sufficient to prove that a false representation had been made but it must be proved that the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 325 of 405 representation was false to the knowledge of the accused and was made to deceive the complainant.
853. The deception within the meaning of section 415 IPC can happen through misrepresentation. In the present case, the prosecution has alleged that various misrepresentations were made by the accused persons.
854. As regards inducing fraudulently or dishonestly, Hon'ble Supreme Court after extensively referring to various case law on the issue in the case of Dr. Vimla (supra), observed that while the definition of "dishonestly" involves a pecuniary or economic gain or loss but as regard "fraudulently", it is primarily the intent to defraud which is an important ingredient. The word "defraud" includes an element of deceit. It was also observed that by way of their very definition as provided under IPC, the word "fraudulently" by its construction excludes the element of pecuniary economic gain or loss.
855. It was observed that if the expression "fraudulently" were to be held, to involve the element of injury to the persons or the persons deceived, it would be reasonable to assume that the injury should be something other than pecuniary or economic loss. Though almost always an advantage to one causes loss to another and vice-versa, it need not necessarily be so. It should be held CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 326 of 405 that the concept of fraud would include not only deceit but also some injury to the person deceived. It would be thus appropriate to hold by analogy drawn from the definition of "dishonestly" that to satisfy definition of "fraudulently" it would be sufficient if there was a non-economic advantage to the deceiver or non-economic loss to the deceit. Both need not co-exist. It was also observed by Hon'ble Supreme Court that the Juxtaposition of the two expressions "dishonestly" and "fraudulently" used in the various sections of the Code indicate their close affinity and therefore the definition of one may give colour to the other. The aforesaid observations of Hon'ble Supreme Court culling out the difference between the words "dishonestly" and "fraudulently" have been followed consistently in all subsequent cases involving the issue of cheating.
856. The next issue which comes up is whether all such fraudulent acts done with a dishonest intention to deceive MoC, Govt. of India actually had the effect of deceiving Screening Committee, MoC and thereby Govt. of India or not. In other words, whether the persons by way of such fraudulent acts done with dishonest intention actually deceived Screening Committee, Ministry of Coal or not and thereby induced it to deliver a property to them.
857. Considered so, the facts of the present case have to be adjudged in the light of the above statement of law.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 327 of 405
858. Ld. DLA argued that from the material on record, the offence of cheating is clearly made out.
859. On the other hand, Ld. Defence Counsels repelled the said contention and submitted that the ingredients of the offence are not met out.
860. From the material on record the prosecution has proved that A-1 company had filed application for allocation of coal block [Ex. PW-1/B which was signed by PW-1. It has proved that A-4 had made presentation before the 35th Screening Committee and submitted feedback form [Ex. PW3/J]. It has also proved that A-3 had signed various letters Ex. PW3/Q1 to Q12.
861. Further, the prosecution has proved that the informations qua networth, promoter, previous allocation and syndication of debt mentioned in the application and feedback form were false and they were false to the knowledge of the accused persons. It has proved that the letters written by A-3 were also containing same misrepresentation regarding who was promoting, controlling and managing JLD.
862. Prosecution has also proved that the misrepresentations so made in the application form, feedback form and the letters induced the MoC and Govt. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 328 of 405 of India to recommend and issue letter of allocation of Fatehpur East Coal Block to A-1 company.
863. Thus, when in the light of aforesaid observations of Hon'ble Supreme Court, the overall facts and circumstances of the present case are seen then it is crystal clear that the actions of the accused persons in making all such false claims knowing them to be false were actuated with an intention to deceive MoC and thereby Govt. of India. The intention to defraud on the part of accused persons is writ large on the face of record. It is also clear that all the acts committed by the accused persons have been fraudulently done with a dishonest intention. But for the deception and resulting dishonest and fraudulent inducement caused to the Screening Committee, the MoC and thus to the Govt. of India, there would have been no allocation of coal block to the accused company.
864. Another contention raised by Ld. Counsel for A-1 to A-4 was that charge of cheating was not put to accused persons in their statements u/s 313 CrPC which caused prejudice to them. Ld. DLA answered this contention by submitting that the court is merely required to question the accused generally on the case and only incriminating circumstances need only be put to accused for explanation.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 329 of 405
865. The reply of Ld. DLA is found acceptable. Moreover, the accused persons A-1 to A-4 had also filed their written statements u/s 313 (5) CrPC which was sufficient compliance of S. 313 CrPC.
866. Another submission of Ld. Defence Counsel was that the accused persons A-1 to A-4 had reason believe that IDFC was a principal of JLD and as such they could mention its networth.
867. Sec. 26 IPC is as under:
26. "Reason to believe".--A person is said to have "reason to believe" a thing, if he has sufficient cause to believe that thing but not otherwise.
868. He thus argued that there was reason to believe and as such there was no dishonest intention on the part of the accused persons.
869. I find no merit in this submission. The informations submitted in the application were false facts which cannot give any sufficient cause to believe a thing and thus cannot provide any reason to believe for the accused persons. A plain reading of the MoU dt. 27.12.2006 would show that IDFC was not a promoter and thus could not be a principal.
870. The grievance of Ld. Counsel for A-1 to A-4 that charges were CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 330 of 405 defective is also uncalled for. No prejudice has been caused to the accused persons. They were well aware of the case which they were to meet against them.
871. The contention of Ld. Defence Counsel that PW1, PW2, PW3, PW6 and PW7 are interested witnesses and their testimonies should not be relied also does not merit acceptance. It is a bare allegation without any substance. Evidence of these witnesses is reliable.
872. From the above, it can be safely concluded that the accused persons A-1 to A-4 cheated the Screening Committee, the MoC and the Govt. of India in the abovesaid manner. Thus the offence of cheating is made out against them.
873. In view of above, the it is held that the offence of cheating u/s 420 IPC is clearly made out in the given facts and circumstances against A-1 to A-4. POINT FOR DETERMINATION NO. (g):
WHETHER THE OFFENCE OF CRIMINAL MISCONDUCT/ CORRUPTION IS MADE OUT AGAINST ACCUSED A-5 TO A-7?
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 331 of 405
874. Ld. DLA submitted that prosecution has proved the offence u/s 13(1)(d)(ii) & (iii) PC Act against A-5 to A-7. He contended that accused public servants abused their powers and made recommendations in favour of an ineligible company. He referred to various notesheets in the files of MoC and submitted that from the same, it is apparent that applications were not checked in MoC for their completeness and eligibility. According to him, this was done by A-5 to A-7 in conspiracy with A-1 to A-4. He submitted that misrepresentations were known to accused public servants. He referred to letter dated 23.05.2007 (Ex. PW13/A) of Sh. V.K. Jairath vide which recommendation of state of Maharashtra was communicated to MoC and in which it was clearly mentioned that Darda goup and Abhijeet group of Nagpur had joined hands to setup power project.
875. Ld. Counsel Sh. Rahul Tyagi for the accused persons A-5 to A-7 argued that there is no evidence that misrepresentations made by the applicant company were known to any of these accused at the relevant time. He contended that criteria of 0.50 per Mega Watt was not known to A-5 to A-7 and other members of the Screening Committee.
876. Ld. Counsel vehemently questioned the order dated 22.07.2015 vide which it was held that there was deemed sanction for prosecution of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 332 of 405 accused persons. He argued that it is a case of no sanction and as such accused public servants must be discharged from the case. He argued that sanction was not proper. He further submitted that there is no sanction u/s 197 CrPC.
877. He argued that which guidelines of the MoC were violated has not been specified in the order on charge. He further submitted that there is no evidence of conspiracy. There was no duty upon A-5 to A-7 to check the applications for their eligibility and completeness. He contended that order on charge was also defective.
878. Another contention of Ld. Counsel is that if MoC was cheated, so were A-5 to A-7 as they were part of the MoC.
879. He contended that networth criteria was only internal mechanism of MoP and it was not in the knowledge of A-5 to A-7.
880. Regarding K.C. Samria/A-7, Ld. Counsel submitted that he joined CA-I Section, MoC on 17.04.2007 and he was not part of any conspiracy. Ld. Counsel contended that verification of the applications was not the duty of MoC and rather it was to be done by Administrative Ministry or the concerned State Govt..
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 333 of 405
881. He also contended that there was no demand or acceptance by any of the accused public servants. Ld. Counsel argued that PW-14 Sh. V.S. Rana has deposed that A-5 to A-7 did not ensure checking of applications for eligibility and completeness. However, Ld. Counsel submitted that it was not duty of A-5 to A-7 to check the same. The immediate superior of Sh. V.S. Rana was Director who was Sh. Sanjeev Mittal at the relevant time and not K.C. Samria/A-7.
882. Ld. Counsel also pointed out that A-5 to A-7 did not see the applications before the Screening Committee meeting. He contended that it was responsibility of the Section Officer to scan through the applications.
883. He questioned the reliability of evidence of PW-14 submitting that PW-14 does not remember many facts and suffers from poor memory and is thus not reliable.
884. He pointed out that additional information was being given by the applicant companies to the Administrative Ministry and/or the concerned State Govt. but not to MoC as MoC had no role.
885. Ld. Counsel contended that A-5 was not wrong in considering IDFC as promoter of JLD. He pointed out that in the final meeting there were CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 334 of 405 no detailed discussions about the matter. He pointed out that in the final meeting no detailed discussions took place. He also highlighted that minutes of the meeting were put on the website which were downloaded and Screening Committee accepted recommendations of CEA in respect of M/s JLD.
886. Another contention of Ld. Counsel for A-5 to A-7 was that recommendations of the Nodal Ministry/Administrative Ministry and all the State Govts. were not binding on the Screening Committee. Further recommendations of the Screening Committee were not binding on MoC. He referred to the letter dated 11.05.2007 and 20.06.2007 of D-23 and pointed out that MoP had undertaken some responsibilities. He also pointed out that MoP guidelines were never sent to the MoC or the applicant companies. There was no criteria for minimum networth. He argued that MoP guidelines were not binding as there were MoC guidelines already available. He also highlighted that the guidelines do not use the term 'promoter' and rather it uses the term 'principal'.
887. Ld. Counsel contended that 'partnering' is no different from 'promoter'. He contended that as a matter of fact IDFC was promoter of M/s JLD as it intended to partnering with M/s JLD.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 335 of 405
888. Regarding evidence of PW-3, Ld. Counsel contended that prosecution did not declare him hostile despite he stated many facts against prosecution case.
889. He also expressed his views on the word 'engaged in' as appearing in the CMN Act. He highlighted that since 1993 coal blocks were being given to companies proposing to engage in power production.
890. He also highlighted that no witness has stated that coal block was to be given to the company engaged in the production of power, cement, iron and steel.
891. Regarding previous allocation he contended that it was not a disqualification. There was no mechanism of pointing out previous allocation.
892. Another contention of Ld. Counsel is that allocation only happened after acceptance by MoC and not before that.
893. He also argued that MoP, MoS and PMO evaluated the decision of Hon'ble Supreme Court. He pointed out that letter written by Vijay Darda to PMO was for Lohara West coal block and, therefore, it could not be considered as an act of conspiracy because what was ultimately allocated was Fatehpur CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 336 of 405 East coal block.
894. Ld. Counsel also vehemently contended that there was no challenge to the minutes of the meetings of Screening Committee. As per the minutes, charts were supplied whereas as per PWs charts were not supplied. He contended that after 12 years minutes can not be challenged. He argued that prosecution has failed to establish that charts were not placed before the Screening Committee.
895. Referring to the work of the Screening Committee, he submitted that when Chairman takes a decision and no member objects then the decision is final and unanimous. He argued that if the recommendation is false, the fault lies with the State Govt. or the Administrative Ministry.
896. He also vociferously argued that case against accused public servants has been made out of ignorance of legal principles about decision making in the Govt.. He referred to State of Bihar & Ors. Vs. Kripalu Shankar & Ors. MANU/SC/0166/1987.
"13. It cannot be disputed that the appeal raises an important question of law bearing upon the proper functioning of a deMoCratic Govt.. A Govt. functions by taking decisions on the strength of views and suggestions expressed by the various officers at different levels, ultimately getting CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 337 of 405 finality at the hands of the Minister concerned. Till then, conflicting opinions, views and suggestions would have emanated from various officers at the lower level. There should not be any fetter on the fearless and independent expression of opinions by officers on matters coming before them through the files. This is so even when they consider orders of courts. Officers of the Govt. are often times confronted with orders of courts, impossible of immediate compliance for various reasons. They may find it difficult to meekly submit to such orders. On such occasions they will necessarily have to note in the files, the reasons why the orders cannot be complied with and also indicate that the courts would not have passed these orders if full facts were placed before them. The expression of opinion by the officers in the internal files are for the use of the department and not for outside exposure or for publicity. To find the officers guilty for expressing their independent opinion, even against orders of courts in deserving cases, would cause impediments in the smooth working and functioning of the Govt.. These internal notings, in fact, are privileged documents. Notings made by the officers in the files cannot, in our view, be made the basis of contempt action against each such officer who makes the notings. If the ultimate action does not constitute contempt, the intermediary suggestions and views expressed in the notings, which may sometimes even amount ex- facie disobedience of the courts orders, will not amount to contempt of court. These notings are not meant for publication.
xxxxx xxxxx
16. Articles 166(1) requires that all executive action of the State Govt. shall be expressed to be taken in the name of the Governor. This clause relates to cases where the executive action has to be expressed in the shape of a formal order or notification. It prescribes the mode in which an executive CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 338 of 405 action has to be expressed. Noting by an official in the departmental file will not, therefore, come within this Article nor even noting by a Minister. Every executive decision need not be as laid down under Article 166(1) but when it takes the form of an order it has to comply with Article 166(1). Article 166(2) states that orders and other instruments made and executed under Article 166(1), shall be authenticated in the manner prescribed. While clause (1) relates to the mode of expression, clause (2) lays down the manner in which the order is to be authenticated and clause (3) relates to the making of the rules by the Governor for the more convenient transaction of the business of the Govt.. A study of this Article, therefore, makes it clear that the notings in a file get culminated into an order affecting right of parties only when it reaches the head of the department and is expressed in the name of the Governor, authenticated in the manner provided in Article 166(2)."
897. He also relied upon Sethi Auto Service Station & Ors. v Delhi Development Authority & Ors., [MANU/SC/8127/2008] wherein it was observed:
"17.From the afore-extracted notings of the Commissioner and the order of the Vice Chairman, it is manifest that although there were several notings which recommended consideration of the appellants' case for relocation but finally no official communication was addressed to or received by the appellants accepting their claim. After the recommendation of the Technical Committee, the entire matter was kept pending; in the meanwhile a new policy was formulated and the matter was considered afresh later in the year 2004, when the proposal was rejected by the Vice Chairman, the final decision making authority in the hierarchy. It is, thus, plain that though the proposals had the recommendations of State Level Co-ordinator (oil CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 339 of 405 industry) and the Technical Committee but these did not ultimately fructify into an order or decision of the DDA, conferring any legal rights upon the appellants. Mere favourable recommendations at some level of the decision making process, in our view, are of no consequence and shall not bind the DDA. We are, therefore, in complete agreement with the High Court that the notings in the file did not confer any right upon the appellants, as long as they remained as such. We do not find any infirmity in the approach adopted by the learned Single Judge and affirmed by the Division Bench, warranting interference."
898. He also submitted that it was a decision of the Screening Committee and not of an individual officer. He referred to the testimony of PW- 24 Sh. Bhaskar Khulbe in this regard. Particularly referring to the role of A-6 K.S. Kropha, Ld. Counsel submitted that as per Shackleton, convening means 'causes to come together'. His limited role is to get notices issued and take steps for holding the meetings.
899. He referred to R. Sai Bharathi Vs. J. Jayalalitha & Ors., MANU/SC/0956/2003 and Ravi Yashwant Bhoir Vs. District Collector, Raigad, MANU/SC/0186/2012.
900. He submitted that members of the Screening Committee had attended meetings and they took part in it and also appended their names and signatures to the recommendations therefore it was a collective decision. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 340 of 405
901. He also contended that rules of the game can not be changed midway. He argued that prosecution wrongly pleaded that UMPP criteria adopted by CEA/MoP was to be applied by the Screening Committee. He pointed out that this criteria of minimum networth was not present in the guidelines of MoC. He argued that the criteria adopted by MoP after publication of the advertisement, submission of applications and recommendations of State Govts. and presentations of the applications was itself illegal as rules of the game can not be changed midway. He referred to Monarch Infrastructure (P) Ltd. v Commissioner, Ulhasnagar Municipal Corporation and Ors. (2000) 5 SCC 287; Hemani Malhotra Vs. High Court of Delhi 2008 (7) SCC 11 and Nitu Gogoi Vs. State of Assam, MANU/GH/0984/2017.
902. He also contended that guidelines published by MoC did not have force of law and they were not issued under MMDR Act or CMN Act. There was no duty cast under any law which was to be performed. He contended that it was mere non-observance of some administrative guidelines and as such can not be called illegal or criminal. He submitted that it may lead to departmental action but certainly not criminal action. He referred to the case of Dr. P.B. Desai Vs. State of Maharashtra & Anr. MANU/SC/0937/2013.
903. Ld. DLA replied that the guidelines were not under MMDR Act but CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 341 of 405 they were certainly under CMN Act.
904. Ld. Counsel for the accused however countered this submission also contending that these guidelines can not be called to have been issued under CMN Act.
905. He referred to the testimony of PW-14 Sh. V.S. Rana wherein he stated that there is no reference of any Act, Rule or Regulations in any of the notings leading to the finalization of the guidelines. He relied upon G. J. Fernandez Vs. State of Mysore, MANU/SC/0050/1967; Chief Commercial Manager, South Central Railway, Secunderabad Vs. G. Ratnam MANU/SC/7843/2007 and Gulf Goans Hotels Company Ltd. Vs. Union of India, MANU/SC/0848/2014.
906. Ld. DLA repelled these contentions.
907. I have considered the submissions.
908. The contentions of the Ld. Defence Counsel that recommendation of Screening Committee was not of any value is misconceived in the sense that the Screening Committee was empowered to make recommendation as per the policy decision. The function of the Screening Committee can not be said to be CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 342 of 405 merely expressing opinions. The Screening Committee undertook a complex exercise which required decision making at various steps. A-5 being the Chairman, A-6 being the Convener and A-7 being the Director, CA-I Section, MoC must own their actions. Moreover, it is a case of conspiracy and the actions of A-5 to A-7 have to be appreciated in the light of these circumstances.
909. The objection of Ld. Counsel that adoption of UMPP criteria by CEA/MoP is not worth consideration. It is true that criteria of minimum networth was not present in the guidelines of MoC, but it can not be said that for this reason no minimum criteria could be fixed by MoP/CEA. It must be noted that MoC had sent the applications for views/comments/recommendations of MoP. Due to large number of applications MoP adopted a pre-qualification criteria which can be said to be justified in these circumstances. The CEA/MoP adopted the UMPP criteria which was 0.50 crores per MW. It can not be said that this amounted to change of rule of the game midway. The guidelines of MoC had taken capacity of minimum 500 MW in respect of power plant.
910. The Coal Mines (Nationalisation) Act, 1973 was amended in 1993 so as to provide for allocation of captive coal blocks to companies in private sector also, who were engaged in specified end uses. At that time, an inter- departmental/inter-governmental body called the "Screening Committee" was CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 343 of 405 constituted in MoC to screen all such proposals as may be received in MoC seeking allocation of captive coal blocks. Beside MoC which was the Nodal Ministry, various other Administrative Ministries such as Ministry of Steel, Ministry of Power or Department of Industrial Promotion and Policy, various State Govts. of states where coal blocks which were proposed to be allocated were situated or where the proposed end use project was to be situated were members of Screening Committee. Central Mine Planning & Design Institute Limited, (CMPDIL), Coal India Ltd. (CIL) and its other subsidiary companies were also part of the Screening Committee. The purpose was to have views of all concerned at one single platform so as to not only expedite the coal block allocation process but to also have a body which may screen the proposals in an objective and transparent manner. Thus the various Screening Committees started laying down its own procedures to screen the proposals and to make its recommendations in an objective and transparent manner.
911. Initially no advertisement used to be issued by MoC for inviting applications for allocation of captive coal blocks but the 34 th Screening Committee issued an advertisement in the year 2005 inviting applications for allocation of captive coal blocks. The past practices and procedure as used to be followed by the earlier Screening Committees were also compiled at one place CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 344 of 405 and with suitable additions/modifications and guidelines were issued to govern the coal block allocation process. Similarly at the time of 35 th and 36th Screening Committee also, applications were invited by way of an advertisement. After making suitable modifications in the earlier guidelines issued and besides incorporating the recommendations of 7th Energy Co-ordination Committee headed by Prime Minister and as were communicated to MoC vide I.D. note of PMO dated 25.07.2006 Ex. PW 14/B-5 (Colly), fresh guidelines governing allocation of captive coal blocks were issued by MoC. Thus these guidelines issued at the time of inviting applications in November 2006 were to govern the allocation of captive coal blocks by 35th and 36th Screening Committees.
912. It has been vehemently argued by Ld. Counsels for the accused public servants that as the guidelines issued by MoC were not issued under any Act, rules or regulations having any statutory backing or force and were not even published in the Gazette or authenticated in the manner required by law for giving the guidelines force of law, so the said guidelines which were only in the nature of administrative guidelines/instructions issued by MoC did not cast any legal duty. It was thus argued that since the said guidelines did not have any binding force of law so any act of omission or in contravention of such instructions/guidelines does not become illegal per se unless the same also contravened some law, making such act or omission illegal. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 345 of 405
913. It is pertinent to mention that the said guidelines were issued by MoC purportedly to provide a mechanism to implement the provisions of Mines and Minerals Act, 1957 and that of Coal Mines Nationalisation Act, 1973 as it stood amended in the year 1993. In its order dated 25.08.14, Hon'ble Supreme Court observed that the procedure adopted by MoC and by Screening Committee was not in accordance with the provisions of aforesaid Acts. However Hon'ble Supreme Court in the said order proceeded further to consider various acts undertaken by MoC and the Screening Committee in the allocation of various captive coal blocks assuming that Central Govt. has powers to allot captive coal blocks under MMDR Act, 1957 and CMN Act, 1973. Thus the exercise being undertaken by this Court in the present proceedings is also primarily confined to examination of various acts of omissions and commissions of accused MoC officers as were undertaken by them in the coal block allocation process which led to allocation of Fatehpur East coal block in favour of M/s JLD, with the assumption that the Central Govt. was acting under the two Acts believing bonafidely that it had power to so act. Thus what is required to be seen in the present proceedings is whether the rules/regulations or procedures as were devised by MoC for allocating captive coal blocks were adhered to by the accused MoC officers and by the Screening Committee and if not, then reasons thereof and the intention in not doing so. However it is CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 346 of 405 certainly true that before proceeding to examine the aforesaid aspects it also needs to be seen as to whether the guidelines so issued by MoC governing allocation of captive coal blocks were binding in nature or not, for only then the issue relating to any violation of the guidelines can be more appropriately examined.
914. As earlier also mentioned the very purpose of issuance of guidelines by MoC so as to govern allocation of captive coal blocks and their subsequent uploading on the website of MoC was to bring them to the notice of public at large. A bare reading of said guidelines, as have been earlier reproduced, shows that the same not only controlled but also regulated the exercise of discretion by MoC and the Screening Committee in allocation of captive coal blocks. The purpose was also to inform the public at large as to how the allocation of captive coal blocks would be made by MoC.
915. Let us take note of some observations of Hon'ble Supreme Court in cases where Govt. was dealing with private persons in matters relating to award of contracts, grant of largesse etc.
916. In the case Erusian Equipment and Chemicals Ltd. Vs. State of West Bengal (1975) 1 SCC 70, it was observed by Hon'ble Supreme Court as under:
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 347 of 405 "When the Govt. is trading with the public, 'the deMoCratic form of Govt. demands equality and absence of arbitrariness and discrimination in such transactions'. The activities of the Govt. have a public element and, therefore, there should be fairness and equality. The State need not enter into any contract with anyone, but if it does so, it must do so fairly without discrimination and without unfair procedure."
(Emphasis supplied)
917. The aforesaid observations were again approved by Hon'ble Supreme Court in the case Ramana Dayaram Shetty Vs. International Airport Authority of India 1979 (3) SCC 489 as under:
"This proposition would hold good in all cases of dealing by the Govt. with the public, where the interest sought to be protected is a privilege. It must, therefore, be taken to be the law that where the Govt. is dealing with the public, whether by way of giving jobs or entering into contracts or issuing quotas or licences or granting other forms of largess, the Govt. cannot act arbitrarily at its sweet will and, like a private individual, deal with any person it pleases, but its action must be in conformity with standard or norms which is not arbitrary, irrational or irrelevant."
(Emphasis supplied)
918. In Kasturi Lal Lakshmi Reddy Vs. State of J&K, 1980 4 SCC 1, Hon'ble Supreme Court while again referring to Ramana Dayaram Shetty case (Supra) further observed as under:
"10. It was pointed out by this Court in "Ramana Dayaram Shetty v. International Airport Authority of India [1979 (3) SCC 489] CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 348 of 405 that with the growth of the welfare state, new forms of property in the shape of Govt. largess are developing, since the Govt. is increasingly assuming the role of regulator and dispenser of social services and provider of a large number of benefits including jobs, contracts, licences, quotas, mineral rights etc. There is increasing expansion of the magnitude and range of Govt.al functions, as we move closer to the welfare state, and the result is that more and more of our wealth consists of these new forms of property. Some of these forms of wealth may be in the nature of legal rights but the large majority of them are in the nature of privileges. The law has however not been slow to recognise the importance of this new kind of wealth and the need to protect individual interest in it and with that end in view, it has developed new forms of protection. Some interests in Govt. largess, formerly regarded as privileges, have been recognised as rights, while others have been given legal protection not only by forging procedural safeguards but also by confining, structuring and checking Govt. discretion in the matter of grant of such largess. The discretion of the Govt. has been held to be not unlimited in that the Govt. cannot give largess in its arbitrary discretion or at its sweet will or on such terms as it chooses in its absolute discretion. There are two limitations imposed by law which structure and control the discretion of the Govt. in this behalf. The first is in regard to the terms on which largess may be granted and the other, in regard to the persons who may be recipients of such largess.
11. So far as the first limitation is concerned, it flows directly from the thesis that, unlike a private individual, the State cannot act as it pleases in the matter of giving largess. Though ordinarily a private individual would be guided by economic considerations of self-gain in any action taken by him, it is always open to him under the law to act contrary to his self- interest or to oblige another in entering into a contract or dealing with his property. But the Govt. is not free to act as it likes in granting largess such as awarding a contract or selling or leasing out its property. Whatever be its activity, the Govt. is still the Govt. and is, subject to restraints inherent in its position in a deMoCratic society. The constitutional power conferred on CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 349 of 405 the Govt. cannot be exercised by it arbitrarily or capriciously or in an unprincipled manner; it has to be exercised for the public good. Every activity of the Govt. has a public element in it and it must therefore, be informed with reason and guided by public interest. Every action taken by the Govt. must be in public interest; the Govt. cannot act arbitrarily and without reason and if it does, its action would be liable to be invalidated. If the Govt. awards a contract or leases out or otherwise deals with its property or grants any other largess, it would be liable to be tested for its validity on the touch-stone of reasonableness and public interest and if it fails to satisfy either test, it would be unconstitutional and invalid.
12. Now what is the test of reasonableness which has to be applied in order to determine the validity of Govt.al action. It is undoubtedly true, as pointed out by Patanjali Shastri, J. in State of Madras v. V.G. Rau,[1952] SCR 597 that in forming his own conception of what is reasonable, in all the circumstances of a given case, it is inevitable that the social philosophy and the scale of values of the judge participating in the decision, would play an important part, but even so, the test of reasonableness is not a wholly subjective test and its contours are fairly indicated by the Constitution. The concept of reasonableness in fact pervades the entire constitutional scheme. The interaction of Articles 14, 19 and 21 analysed by this Court in Maneka Gandhi v. Union of India[1978] 2 SCR 621 clearly demonstrated that the requirement of reasonableness runs like a golden thread through the entire fabric of fundamental rights and, as several decisions of this Court show, this concept of reasonableness finds its positive manifestation and expression in the lofty ideal of social and economic justice which inspires and animates the directive principles. It has been laid down by this Court in E.P. Royappa v. State of Tamil Nadu [1974] 2 SCR 348, and Maneka Gandhi case that Article 14 strikes at arbitrariness in State action and since the principle of reasonableness and rationality, which is legally as well as philosophically an essential element of equality or non-arbitrariness, is protected by this article, it must characterise every Govt.al action, whether it be under the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 350 of 405 authority of law or in exercise of executive power without making of law. So also the concept of reasonableness runs through the totality of Article 19 and requires that restrictions on the freedoms of the citizen, in order to be permissible, must at the best be reasonable. Similarly Article 21 in the full plenitude of its activist magnitude as discovered by Maneka Gandhi case, insists that no one shall be deprived of his life or personal liberty except in accordance with procedure established by law and such procedure must be reasonable, fair and just. The Directive Principles concretise and give shape to the concept of reasonableness envisaged in Articles 14, 19 and 21 and other Articles enumerating the fundamental rights. By defining the national aims and the constitutional goals, they setforth the standards or norms of reasonableness which must guide and animate Govt.al action. Any action taken by the Govt. with a view to giving effect to any one or more of the Directive Principles would ordinarily, subject to any constitutional or legal inhibitions or other over-riding considerations, qualify for being regarded as reasonable, while an action which is inconsistent with or runs counter to a directive principle would prima facie incur the reproach of being unreasonable.
13. So also the concept of public interest must as far as possible receive its orientation from the directive principles. What according to the founding fathers constitutes the plainest requirement of public interest is set out in the directive principles and they embody par excellence the constitutional concept of public interest. If, therefore, any Govt.al action is calculated to implement or give effect to a directive principle, it would ordinarily, subject to any other overriding considerations, be informed with public interest.
14. Where any Govt.al action fails to satisfy the test of reasonableness and public interest discussed above and is found to be wanting in the quality of reasonableness or lacking in the element of public interest, it would be liable to be struck down as invalid. It must follow as a necessary corollary from this proposition that the Govt. cannot act in a manner which would CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 351 of 405 benefit a private party at the cost of the State; such an action would be both unreasonable and contrary to public interest. The Govt., therefore, cannot, for example, give a contract or sell or lease out its property for a consideration less than the highest that can be obtained for it, unless of course there are other considerations which render it reasonable and in public interest to do so. Such considerations may be that some directive principle is sought to be advanced or implemented or that the contract or the property is given not with a view to earning revenue but for the purpose of carrying out a welfare scheme for the benefit of a particular group or section of people deserving it or that the person who has offered a higher consideration is not otherwise fit to be given the contract or the property. We have referred to these considerations to only illustratively, for there may be an infinite variety of considerations which may have to be taken into account by the Govt. in formulating its policies and it is on a total evaluation of various considerations which have weighed with the Govt. in taking a particular action, that the Court would have to decide whether the action of the Govt. is reasonable and in public interest. But one basic principle which must guide the Court in arriving at its determination on this question is that there is always a presumption that the Govt.al action is reasonable and in public interest and it is for the party challenging its validity to show that it is wanting in reasonableness or is not informed with public interest. This burden is a heavy one and it has to be discharged to the satisfaction of the Court by proper and adequate material. The Court cannot lightly assume that the action taken by the Govt. is unreasonable or without public interest because, as we said above, there are a large number of policy considerations which must necessarily weigh with the Govt. in taking action and therefore the Court would not strike down Govt.al action as invalid on this ground, unless it is clearly satisfied that the action is unreasonable or not in public interest. But where it is so satisfied, it would be the plainest duty of the Court under the Constitution to invalidate the Govt.al action. This is one of the most important functions of the Court and also one of the most essential for preservation of the rule of law. It is imperative in a deMoCracy governed by the rule of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 352 of 405 law that Govt.al action must be kept within the limits of the law if there is any transgression the Court must be ready to condemn it. It is a matter of historical experience that there is a tendency in every Govt. to assume more and more powers and since it is not an uncommon phenomenon in some countries that the legislative check is getting diluted, it is left to the Court as the only other reviewing authority under the Constitution to be increasingly vigilant to ensure observance with the rule of law and in this task, the court must not flinch or falter. It may be pointed out that this ground of invalidity, namely, that the Govt.al action is unreasonable or lacking in the quality of public interest, is different from that of mala- fides though it may, in a given case, furnish evidence of mala-fides.
15. The second limitation on the discretion of the Govt. in grant of largess is in regard to the persons to whom such largess may be granted. It is now well settled as a result of the decision of this Court in Ramana D. Shetty v. International Airport Authority of India that the Govt. is not free like an ordinary individual, in selecting the recipients for its largess and it cannot choose to deal with any person it pleases in its absolute and unfettered discretion. The law is now well established that the Govt. need not deal with anyone but if it does so, it must do so fairly without discrimination and without unfair procedure. Where the Govt. is dealing with the public, whether by way of giving jobs or entering into contracts or granting other forms of largess the Govt. cannot act arbitrarily at its, sweet will and, like a private individual, deal with any person it pleases, but its action must be in conformity with some standard or norm which is not arbitrary, irrational or irrelevant. The Govt.al action must not be arbitrary or capricious, but must be based on some principle which meets the test of reason and relevance. This rule was enunciated by the Court as a rule of administrative law and it was also validated by the Court as an emanation flowing directly from the doctrine of equality embodied in Article 14. The Court referred to the activist magnitude of Article 14 as evolved in E. P. Royappa v. State of Tamil Nadu and Maneka Gandhi case and observed that it must follow as a necessary corollary from the principle of equality enshrined in Article 14 CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 353 of 405 that though the State is entitled to refuse to enter into relationship with anyone, yet if it does so, it cannot arbitrarily choose any person it likes for entering into such relationship and discriminate between persons similarly circumstanced, but it must act in conformity with some standard or principle which meets the test of reasonableness and non-discrimination and any departure from such standard or principle would be invalid unless it can be supported or justified on some rational and non-discriminatory ground. (SCC p. 512, para 21). This decision has reaffirmed the principle of reasonableness and non-arbitrariness in Govt.al action which lies at the core of our entire constitutional scheme and structure."
(Emphasis supplied)
919. In Food Corpn. of India Vs. Kamdhenu Cattle Feed Industries (1993) 1 SCC 71, Justice J.S. Verma speaking for the Bench observed as under:
(SCC p. 76, paras 7 and 8) "In contractual sphere as in all other State actions, the State and all its instrumentalities have to conform to Article 14 of the Constitution of which non-arbitrariness is a significant facet. There is no unfettered discretion in public law. A public authority possesses powers only to use them for public good. This imposes the duty to act fairly and to adopt a procedure which is `fairplay in action'. Due observance of this obligation as a part of good administration raises a reasonable or legitimate expectation in every citizen to be treated fairly in his interaction with the State and its instrumentalities, with this element forming a necessary component of the decision making process in all State actions. To satisfy this requirement of non-arbitrariness in a State action, it is, therefore, necessary to consider and give due weight to the reasonable or legitimate expectations of the persons likely to be affected by the decision or else that unfairness in the exercise of the power may amount to an abuse or excess of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 354 of 405 power apart from affecting the bona fides of the decision in a given case. The decision so made would be exposed to challenge on the ground of arbitrariness. Rule of law does not completely eliminate discretion in the exercise of power, as it is unrealistic, but provides for control of its exercise by judicial review.
12. The mere reasonable or legitimate expectation of a citizen, in such a situation, may not by itself be a distinct enforceable right, but failure to consider and give due weight to it may render the decision arbitrary, and this is how the requirement of due consideration of a legitimate expectation forms part of the principle of non-arbitrariness, a necessary concomitant of the rule of law. Every legitimate expectation is a relevant factor requiring due consideration in a fair decision making process. Whether the expectation of the claimant is reasonable or legitimate in the context is a question of fact in each case. Whenever the question arises, it is to be determined not according to the claimant's perception but in larger public interest wherein other more important considerations may outweigh what would otherwise have been the legitimate expectation of the claimant. A bona fide decision of the public authority reached in this manner would satisfy the requirement of non-arbitrariness and withstand judicial scrutiny. The doctrine of legitimate expectation gets assimilated in the rule of law and operates in our legal system in this manner and to this extent."
(Emphasis supplied)
920. In Navjyoti Coop. Group Housing Society Vs. Union of India AIR 1993 SC 155 Hon'ble Supreme Court held as under:
"In the aforesaid facts, the Group Housing Societies were entitled to 'legitimate expectation' of following consistent past CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 355 of 405 practice in the matter of allotment, even though they may not have any legal right in private law to receive such treatment. The existence of 'legitimate expectation' may have a number of different consequences and one of such consequences is that the authority ought not to act to defeat the 'legitimate expectation' without some overriding reason of public policy to justify its doing so. In a case of 'legitimate expectation' if the authority proposes to defeat a person's 'legitimate expectation' it should afford him an opportunity to make representations in the matter. In this connection reference may be made to the discussions on 'legitimate expectation' at page 151 of Volume 1(1) of Halsbury's Laws of England - Fourth Edition (Re-issue). We may also refer to a decision of the House of Lords in Council of Civil Service Union v. Minister for the Civil Service. It has been held in the said decision that an aggrieved person was entitled to judicial review if he could show that a decision of the public authority affected him of some benefit or advantage which in the past he had been permitted to enjoy and which he legitimately expected to be permitted to continue to enjoy either until he was given reasons for withdrawal and the opportunity to comment on such reasons.
It may be indicated here that the doctrine of 'legitimate expectation' imposes in essence a duty on public authority to act fairly by taking into consideration all relevant factors relating to such 'legitimate expectation'. Within the conspectus of fair dealing in case of 'legitimate expectation', the reasonable opportunities to make representation by the parties likely to be affected by any change of consistent past policy, come in. We, have not been shown any compelling reasons taken into consideration by the Central Govt. to make a departure from the existing policy of allotment with reference to seniority in Registration by introducing a new guideline."
921. In the case Sudhir Shantilal Mehta Vs. CBI (2009) 8 SCC 1, while dealing with certain directions issued by RBI to public sector banks, CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 356 of 405 Hon'ble Supreme Court observed as under:
67. It is one thing to say that any circular letter issued by the Reserve Bank of India being not within the public domain would not be law but it would be another thing to say that it did not contain any direction of law so as to attract the liability in terms of Section 405 of the Penal Code. Lawful directions were issued by the Reserve Bank of India. The circular letter was meant for all scheduled banks. The authorities and/or officers running the affairs of the scheduled banks therefore were aware thereof. If it is binding on the banks, it would be binding on the officers.
68. Any act of omission or commission on the part of any authority of the Bank would amount to acting in violation of any direction of law. A direction of law need not be a law made by the Parliament or a Legislature; it may be made by an authority having the power therefor; the law could be a subordinate legislation, a notification or even a custom.
(Emphasis supplied)
922. In the case Rajiv Kumar Vs. State of U.P. (2017) 8 SCC 791, Hon'ble Supreme Court observed as under:
"On appreciation of evidence and materials on record, both the trial court and the High Court recorded concurrent findings that the appellants acted in clear abuse of position, Plot No.27 in the developed Sector-14A was converted from guest house to 'residential' and in violation of the norms and circulars, the same was allotted to the appellant to gain pecuniary advantage to him (Rajiv Kumar). The concurrent findings recorded by the courts below are well balanced and we do not find any reason warranting interference."
(Emphasis supplied) CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 357 of 405
923. It is clarified that in the present proceedings this Court is not carrying out any judicial review of the actions of MoC officers or that of the Screening Committee. What is being examined is whether the actions of accused public servants i.e. of MoC officers involved in the process of allocation of Fatehpur East coal block in favour of company M/s JLD had any element of culpability in the said actions or not. In the case Sudhir Shantilal Mehta (supra), Hon'ble Supreme Court while examining the actions of certain bank officers who acted in violation of guidelines issued by RBI also dealt with the issue of criminal liability of the officers and interalia observed as under in para 64:
"The act of criminal breach of trust per se may involve a civil wrong but a breach of trust with an ingredient of mens rea would give rise to a criminal prosecution as well."
924. It is in the light of aforesaid well settled proposition of law that it needs to be seen as to whether the guidelines issued by MoC governing allocation of captive coal blocks were binding upon the MoC officers and also upon the Screening Committee or not.
925. As earlier also mentioned, the guidelines so issued by MoC, and as CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 358 of 405 were also uploaded on the website of MoC for information of the public at large, were clearly issued to regulate the exercise of discretion by the MoC officers and that of the Screening Committee in the matter of allocation of captive coal blocks. The purpose was to rule out any element of arbitrariness in the said exercise of discretion. The said guidelines undisputedly provided the logical and reasoned steps as to how the MoC officers and the Screening Committee shall undertake the decision making process vide which allocation of captive coal blocks in favour of private applicant companies will be made. Yet another important purpose of issuance of guidelines was also to inform the public at large as to how the exercise of allocation of captive coal blocks shall be undertaken and that the discretion of Ministry of Coal or that of Screening Committee was not unfettered. It was thus represented to the public at large that MoC will undertake the said exercise fairly without discrimination and by following a fair procedure.
926. A perusal of the cases cited by Ld. Counsel shows that in all these matters, the enforcement of the guidelines or regulations issued by the Department were sought by a third person claiming himself to be either a victim or a person affected by the decision of the public servants concerned. It is in that context Hon'ble Supreme Court observed that since the said guidelines did not have the force of law so no right vested in a third party to seek CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 359 of 405 enforcement of said guidelines and regulations. However, at the same time, Hon'ble Supreme Court also observed that the department concerned may initiate departmental proceedings against its officers responsible for following the said guidelines or to act in accordance with the said guidelines, if there is any act of omission or neglect to comply with the said guidelines.
927. From the aforesaid observations, it is thus clear that in so far as the officers of the department which issued those guidelines are concerned they were clearly bound to follow the said guidelines. The said officers can always be punished by the Govt. or department concerned for violation of the said guidelines by them. It is altogether a different matter that such a violation of the guidelines may in a given case entails initiation of departmental enquiry only but at the same time the violation of said guidelines in a given case may also show existence of commission of an offence on the part of public servants concerned and in which case penal action may also be initiated against them.
928. Thus in the light of aforesaid circumstances, it is held that the guidelines issued by MoC governing allocation of captive coal blocks though may not be termed as law under Article 13 of the Constitution of India but were clearly binding upon the accused MoC officers. The said guidelines clearly sought to control the exercise of discretion by MoC and of the Screening CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 360 of 405 Committee in disbursing the larges i.e. allocation of nationalized natural resources (Coal) of the country by way of allocation of captive coal blocks and it was represented by MoC to the public at large as to how the applications are to be submitted or how the same will be dealt with by MoC and by the Screening Committee. It clearly cast a mandatory duty upon the accused public servants to act in accordance with the said guidelines. By no stretch of imagination, the accused MoC officers can claim that even though the guidelines were issued by them intimating the public at large as to how captive coal blocks shall be allocated but while exercising the said discretion they were not bound to follow the said guidelines. In fact the said guidelines in no way took away the discretion either from the MoC officers or from the Screening Committee but simply regulated the exercise of such discretion so vested in them, lest their actions may venture into the arena of unreasonableness, arbitrariness or in any sort of illegality.
929. The guidelines clearly mandated certain eligibility conditions and certain requirements to be fulfilled by the applicant companies, failing which, it was mentioned in the guidelines itself that the applications will be rejected. It was also clarified in the guidelines itself as to in what manner the inter se priority of various competing applicant companies who have applied for any given coal block shall be arrived at. In fact mentioning of these very factors in the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 361 of 405 guidelines were the prime reasons for various applicant companies to inflate their various claims so as to show a better status/stage of preparedness qua their proposed end use project. A legitimate expectation thus arose in the mind of various applicant companies that their applications will be considered objectively and in a transparent manner in accordance with the guidelines so issued by MoC. In these circumstances it can not be claimed by accused MoC officers that they were not bound by the guidelines so issued by MoC governing allocation of captive coal blocks and as were also uploaded on the website of MoC.
930. It is worth noting that when the guidelines were issued by the MoC, it was the common belief that coal blocks could be allocated by the Central Govt. by Screening Committee route. It was understanding of the Govt. of the day that allocation could be made under CMN Act in that manner. It is further worth noting that coal blocks were being allocated earlier also in similar manner. It was only when judgment in Manohar Lal Sharma Vs. The Principal Secretary & Ors., (2014) 9 SCC 516, was pronounced by Hon'ble Supreme Court that this practice of allocation of coal blocks was termed illegal. Therefore, the validity and sanctity of the guidelines will have to be adjudged as per the common practice and procedure which was prevalent at that time. CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 362 of 405
931. Considered as such, there remains no doubt that the guidelines issued by the MoC were issued under CMN Act and were mandatorily to be followed. Any violation of those guidelines will have to be scrutinized and not just ignored.
932. The guidelines provided that the applications after being received in MoC were to be checked for their completeness and eligibility before being sent to Administrative Ministries and concerned State Govts.
933. Even otherwise, if it is assumed that the guidelines were not issued under CMN Act, still the same were binding on the MoC and the Screening Committee. At least in respect of allocation of coal block the guidelines were very much binding and applicable because the same were issued for the said purpose. If not bound by the guidelines, what other Rule or Regulation was binding on the Screening Committee for recommending coal blocks?
934. A-5 to A-7 can not take this defence. They were bound to follow the said guidelines in the process of making recommendations for allocation. Any violation of the guidelines will invite action whether administrative or criminal.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 363 of 405
935. The next issue is whether the guidelines were followed or not. In other words, whether the applications were checked in MoC before being sent to administrative ministries/state Govts.?
936. Ld. Counsel for the accused persons submitted that the applications were checked by the official of CA-I Section as it was their job. He referred to judgment of Sh. Arun Bhardwaj Ld. Special Judge PC Act, CBI, Coal Block Cases-01, RADC in a case related to 34 th Screening Committee, and in which it was held that checking of the applications for completeness and eligibility had indeed taken place. Ld. Counsel submitted that as the same procedure was followed for the 35th Screening Committee, as was followed for the 34 th Screening Committee, it must be held that checking of the applications had taken place. He referred to cross-examination of PW-14 also in this regard.
937. Ld. DLA has vehemently refuted this contention. He referred to various note sheets in the files of MoC and letters such as Ex. PW14/B-7, B-8, PW14/C, PW14/G-4, PW14/C2, PW14/E, PW14/E-1 etc. and submitted that these show that applications were not checked for their completeness and eligibility and were not processed as per the guidelines.
938. Referring to minutes of meeting dt. 11.05.2007 [Ex. PW14/G-4 CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 364 of 405 (Colly.)], and submitted that it shows that there was no checking.
939. Ld. DLA contended that from the above it is apparent that applications were not checked for their completeness and eligibility.
940. The guidelines issued by MOC clearly mandated under the title "Processing of application" that the applications received in MOC in five copies after being checked for their eligibility and completeness would be sent to the Administrative Ministries and State Govts. concerned for their evaluation and recommendation. The guidelines also specified certain documents which were required to be annexed by every applicant company alongwith its applications. It was also stated that applications without the said accompaniments would be treated as incomplete and shall be rejected. Thus in the light of aforesaid nature of guidelines, it becomes clear that before copies of the applications were to be sent to administrative Ministries/State Govts., the same were required to be checked in MOC as regard their completeness and eligibility. As regard eligibility, the primary requirement for every applicant was that it should be a company registered under Indian Companies Act. The second requirement of being eligible was that the company should be engaged either in generation of power or production of iron or steel or in production of cement. For an application to be complete in accordance with guidelines all the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 365 of 405 documents as were specified in the guidelines ought to have been annexed with the application.
941. It can be said that it was job of CA-I Section to check the applications but it was responsibility of A-5 to A-7 to ensure that such an exercise was indeed carried out. Even as per Manual of Office Procedure, the responsibility of a Secretary is absolute.
942. It can not be said that decision of the Screening Committee was unanimous. Evidence on record reveals that PW-13 V.K. Jairath had left the meeting after a short period and he was made to sign on the recommendation sheets on which names of coal blocks were already mentioned. This shows that it was never unanimous decision. The working of the Screening Committee was dubious.
943. The contention of Ld. Counsel that charts were supplied is to be rejected. Witnesses from Screening Committee such as PW24, PW18 and PW13 have stated that no charts were supplied. Reference by Ld. Counsel to the minutes of the Screening Committee does not help.
944. The submission that A-5 was not wrong in considering IDFC as promoter or principal of JLD must be rejected. I have already held that IDFC CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 366 of 405 can not be called either promoter or principal of JLD.
945. The contention for Ld. Counsel for these accused persons that A-5 and A-6 rather were in favour of auction system and thus had no intention of committing any offence under PC Act is liable to be rejected. Expressing view about public auction in the notings is one thing and the processing of the application in the MoC as per the guidelines was another thing.
946. The charts of CMPDIL were never dealt with in any MoC file. File Ex. PW17/A does not show any such noting.
947. What offence u/s 13(1)(d) is made out?
948. Ld. Counsel next contended that there is no case made out u/s 13 (1)(d)(i) and (ii) of the PC Act. He relied upon the case of Neeraj Dutta Vs. State (Govt. of NCT of Delhi), 2022 SCC OnLine 1724. Ld. Counsel has contended that it is admitted that there was no demand or acceptance of any illegal gratification or any pecuniary advantage by any accused public servants. He submitted that no such evidence was found during investigation or produced during trial. He also relied upon A. Sivaprakash Vs. State of Kerala, MANU/SC/0541/2016.
949. It was observed in Neeraj Dutta (supra) as under:
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 367 of 405 "74. What emerges from the aforesaid discussion is summarised as under:
(a) Proof of demand and acceptance of illegal gratification by a public servant as a fact in issue by the prosecution is a sine qua non in order to establish the guilt of the accused public servant under Sections 7 and 13(1)
(d)(i) and (ii) of the Act.
(b) In order to bring home the guilt of the accused, the prosecution has to first prove the demand of illegal gratification and the subsequent acceptance as a matter of fact. This fact in issue can be proved either by direct evidence which can be in the nature of oral evidence or documentary evidence.
(c) Further, the fact in issue, namely, the proof of demand and acceptance of illegal gratification can also be proved by circumstantial evidence in the absence of direct oral and documentary evidence.
(d) In order to prove the fact in issue, namely, the demand and acceptance of illegal gratification by the public servant, the following aspects have to be borne in mind:
(i) if there is an offer to pay by the bribe giver without there being any demand from the public servant and the latter simply accepts the offer and receives the illegal gratification, it is a case of acceptance as per Section 7 of the Act. In such a case, there need not be a prior demand by the public servant.
(ii) On the other hand, if the public servant makes a demand and the bribe giver accepts the demand and tenders the demanded gratification which in turn is received by the public servant, it is a case of obtainment.
In the case of obtainment, the prior demand for illegal gratification emanates from the public servant. This is an offence under Section 13(1)(d)
(i) and (ii) of the Act.
(iii) In both cases of (i) and (ii) above, the offer by the bribe giver and the demand by the public servant respectively have to be proved by the prosecution as a fact in issue. In other words, mere acceptance or receipt of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 368 of 405 an illegal gratification without anything more would not make it an offence under Section 7 or Section 13(1)(d), (i) and (ii) respectively of the Act. Therefore, under Section 7 of the Act, in order to bring home the offence, there must be an offer which emanates from the bribe giver which is accepted by the public servant which would make it an offence. Similarly, a prior demand by the public servant when accepted by the bribe giver and in turn there is a payment made which is received by the public servant, would be an offence of obtainment under Section 13(1)(d) and (i) and (ii) of the Act."
950. Ld. Counsel referring to Neeraj Dutta (supra) submitted that the Constitution Bench has now settled the law and it has held that ....... " To hold a public servant guilty of an offence u/s 13(1)(d)(i) & (ii) it must be proved that the said public servant must have made a demand and the bribe giver must have accepted the demand and he tenders demanded gratification which in turn is accepted by the public servant. This is the case of 'obtainment' which is an offence u/s 13(1)(d)(i) & (ii) PC Act."
951. Ld. Counsel for the accused also referred to Madhu Koda Vs. CBI, MANU/DE/1079/2020, passed by Hon'ble Delhi High Court.
952. Ld. Counsel submitted that further mens rea is required for proving offence u/s 13(1)(d)(ii) PC Act. For this he relied upon judgment titled Madhu Koda Vs. CBI (supra). He contended that from the judgment it is clear that CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 369 of 405 mens rea is an essential part of offence u/s 13(1)(d)(i) & (ii) PC Act. He contended that it is corruption which is to be punished and not perceived bad arbitrary or wrong administrative decisions.
953. He referred to R. Balakrishnan Pillai vs. State of Kerala, MANU/SC/0212/2003 and C.K. Jaffar Shareif Vs. State through CBI, MANU/SC/0962/2012 wherein it was observed:
"17 ........
That dishonest intention is the gist of the offence under section 13(1)(d) is implicit in the words used i.e. corrupt or illegal means and abuse of position as a public- servant'. A similar view has also been expressed by this Court in M. Narayanan Nambiar US. State of Kerala MANU/SC/0164/1962 : (1963) Supp. (2) SCR 724 while considering the provisions of section 5 of Act of 1947. If the totality of the materials on record indicate the above position, we do not find any reason to allow the prosecution to continue against the Appellant. Such continuance, in our view, would be an abuse of the process of court and therefore it will be the plain duty of the court to interdict the same."
954. He contended that there was no quid-pro-quo.
955. Ld. Counsel contended that prosecution case against public servants is founded upon several erroneous legal assumptions as well as assumptions of facts which do not exists. He argued that it is a case based on inferences. He also contended that ingredients of none of the three wings of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 370 of 405 Section 13(1)(d) of PC Act have been satisfied in the present case. He contended that A-6 did nothing to cause any obtainment. He submitted that ingredients of Section 13(1)(d)(iii) also have not been satisfied.
956. Ld. DLA has argued that judgment of the Constitution Bench in Neeraj Dutta (supra) was clarified in the subsequent judgment while applying the said principles of law to the individual case of Neeraj Dutta (supra) it was reported as Neeraj Dutta Vs. State of NCT of Delhi, 2023 SCC Online SC
280.
957. Ld. DLA replied that prosecution has proved the offence u/s 13(1)
(d)(ii) & (iii) PC Act. Regarding offence u/s 13(1)(d)(ii) PC Act, he submitted that it is a clear case of abuse of position as public servants. He contended that accused public servants were fully aware that A-1 company was never eligible for allocation of any coal blocks in view of the provisions of CMN Act, 1973 as it was not engaged in any of the specified end uses but still recommended allocation in its favour. He argued that recommendation to an illegible company amounts to an abuse of official position.
958. Ld. Counsel for the accused public servants also argued that merely by making recommendation, the Screening Committee did not actually allocate CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 371 of 405 the coal block to the company. He contended that only upon allocation of coal block there could be a case of criminal misconduct. He pointed out that the Minister of Coal i.e. the then Prime Minister had approved the recommendation of the Screening Committee and only thereafter obtainment happened.
959. Having perused the judgment of the Constitution Bench, there remains no doubt that proof of demand is must for securing conviction u/s 13 (1)(d)(i) & (ii) PC Act. This is because in case of abuse of official position, there cannot be obtainment unless there is demand from the side of public servant. In the present case, there is no evidence of any demand by any accused public servant. As such the offence u/s 13(1)(d)(ii) PC Act is not made out against the accused public servants.
960. However, as far as offence u/s 13(1)(d)(iii) PC Act is concerned prosecution has clearly proved the said offence. A-1 company was ineligible for allocation of the coal block but was still recommended by the Screening Committee headed by A-5 H.C. Gupta as Chairman, A-6 K.S. Kropha was Member Convener. A-7 K.C. Samria was Director, CA-I Section, MoC who also failed to perform his duties. Allocation of coal block to an ineligible company is against public interest. The actions of A-5 and A-7 conclusively show that their efforts were to somehow recommend allocation of the coal block CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 372 of 405 in favour of A-1 company and which they did. The minutes of the Screening Committee do not contain any reason as to why allocation was made in favour of A-1 company M/s JLD.
961. The issue of requirement of guilty intention/mens rea for the offence of criminal misconduct as provided u/s 13 (1) (d) (iii) PC Act has been discussed by Hon'ble High Court in the case Runu Ghosh Vs. CBI, Crl. A. 482/2002. It has been observed that if the other requirements of the provisions i.e. Section 13 (1) (d) (iii) PC Act are fullfilled then there is no requirement of mens rea or guilty intention to prove the said offence. The Hon'ble Court while discussing the provisions of Prevention of Corruption Act in detail inter alia observed as under:
"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 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 servant's 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 prosecutable 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 CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 373 of 405 provision aims at ensuring efficiency, and responsible behaviour, as much as it seeks to outlaw irresponsibility in public servant's 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 making a wrong choice; the decision should be one such as no one would have taken.
80. In this context, it would be useful to notice the following passage from the work Errors, Medicine and the Law by Alan Merry and Alexander McCall Smith:
"Criminal punishment carries substantial moral overtones. The doctrine of strict liability allows for criminal conviction in the absence of moral blameworthiness only in very limited circumstances. Conviction of any substantial criminal offence requires that the accused person should have acted with a morally blameworthy state of mind. Recklessness and deliberate wrongdoing, levels four and five are classification of blame, are normally blameworthy but any conduct falling short of that should not be the subject of criminal liability. Common-law systems have traditionally only made negligence the subject of criminal sanction when the level of negligence has been high -- a standard traditionally described as gross negligence.
* * * Blame is a powerful weapon. When used appropriately and according to morally defensible criteria, it has an indispensable role in human affairs. Its inappropriate use, however, distorts tolerant and constructive relations between people. Some of life's misfortunes are accidents for which nobody is morally responsible. Others are wrongs for which responsibility is diffuse. Yet others are instances of culpable conduct, and constitute grounds for compensation and at times, for punishment. Distinguishing between these various categories requires careful, morally sensitive and scientifically informed analysis."
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 CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 374 of 405 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.
82. It would be useful to in this context, take 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 supplying sub- standard drugs, would 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.
83. "The test this Court has indicated is neither doctrinaire, nor vague; it is rooted in the Indian legal system. A public servant acts without public interest, when his decision or action is so unreasonable that no reasonable man, having regard to the entirety of circumstances, would have so acted; it may also be that while deciding or acting as he does, he may not intend the consequence, which ensues, or is likely to ensue, but would surely have reasonable foresight that it is a likely one, and should be avoided. To put it differently, the public servant acts without public interest, if his action or decision, is by manifestly failing to exercise reasonable precautions to guard against injury to public interest, which he was bound, at all times to do, resulting in injury to public interest. The application of this test has to necessarily be based on the facts of each case; the standard CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 375 of 405 however, is objective. Here, one recollects the following passage of Justice Holmes in United States v. Wurzbach 1930 (280) US 396:
"Wherever the law draws a line there will be cases very near each other on opposite sides. The precise course of the line may be uncertain, but no one can come near it without knowing that he does so, if he thinks, and if he does so it is familiar to the criminal law to make him take the risk.""
962. From this judgment it is apparent that no mens rea is required for the offence u/s 13(1)(d)(iii) PC Act.
963. In the present case the acts and omissions on the part of A-5 to A-7 reveal that they had allocated the coal block to A-1 company against public interest as A-1 company was ineligible.
964. Therefore A-5 to A-7 are held guilty of offence u/s 13(1)(d)(iii) r/w Section 13(2) PC Act.
POINT FOR DETERMINATION NO. (h):
WHETHER THERE WAS ANY CONSPIRACY AMONGST THOSE WHO WERE RESPONSIBLE AS ABOVE?
965. Regarding the offence of conspiracy, ld. Counsels for the accused persons contended that no offence of conspiracy is made out. They argued that there is no cogent evidence showing existence of any conspiracy. They also CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 376 of 405 contended that no conspiracy can be made out by few bits here and few bits there. Ld. Counsel for A-1 to A-4 strongly relied upon:
a) Hanumant v. State of M.P., (supra):
"11. The trial Magistrate was of the opinion that friendship between the two accused was of a very rapid growth and that their relations were very intimate and Accused 2 was in a position to influence Accused 1. He thus found that there was motive for the commission of the crime. The learned Sessions Judge disagreed with this finding and the High Court agreed with the Sessions Judge on this point. It observed that the evidence which tended to prove friendship or undue favour was not such as to form the basis for a finding. It further found that there was nothing to show that the appellant Nargundkar received any illegal reward or the promise of one for showing Doongaji's tender to accused R.S. Patel. The first circumstance therefore on which the trial Judge placed considerable reliance was negatived by the Court of appeal and in revision. It having been found that there was no motive whatsoever for accused Nargundkar to show the tenders to accused Patel and to take a substituted tender from him, the main link in the chain of reasoning of the trial court vanishes. Amiable relations between the two accused or their official relationship could not be regarded as sufficient motive for committing the crime of forgery.";
b) Bhikalal Ramjibhai Zaveri v. State of Maharashtra (1980) 1 SCC 491:
1. The appellant has been convicted under Section 420 read with Section 34 IPC and sentenced to 18 months' rigorous imprisonment. We have gone through the judgment of the High Court and we find that the High Court has also based the conviction of the appellant merely on surmises and conjectures. There is no evidence at all to show that the appellant practised any fraud on the complainant and thereby induced him to part with the cloth nor there is any evidence CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 377 of 405 that the appellant knew that the complainant was not paid the money. The only circumstance that has been relied upon by the prosecution against the appellant is that Appellant 1 was a partner of Accused 2 and they had hired a room where the pieces of cloth were stored. That by itself, however, is not sufficient to show that the appellant had any knowledge of the inducement practised by Accused 2.
2. The evidence does not exclude the possibility that even though Accused 2 may have induced the complainant to deliver the cloth but did not inform Accused 1 regarding the exact state of affairs. In the circumstances, we, therefore, allow this appeal, set aside the conviction and sentence of the appellant and acquit him of the charges framed against him.
The appellant will now be discharged.
c) Nand Kumar Singh v. State of Bihar 1992 Supp (2) SCC 111:
15. The questions are (1) whether both the trial court and the High Court are correct in drawing the conclusion that this appellant is also a party for cheating the LIC simply because he received the premium commission, bonus, etc. and (2) whether the appellant was a party along with accused D.N. Singh in conspiring and then forging the policies. From the evidence which we have extracted above, it is manifest that the appellant has not been a party either for any conspiracy or for forging the documents and making use of the same, but it is a case of the prosecution that it was the accused D.N. Singh who forged the signature of P.K. Prasad as well as the appellant on the Agent's Confidential Report and used the documents which ultimately resulted the LIC sustaining some wrongful loss. The bonus commission, the incentive bonus, etc. permissible to the appellant in accordance with the law in respect of the two policies were credited to his account only in the normal course. Further there is no acceptable evidence that the accused D.N. Singh did all with the knowledge and consent of the appellant. In these circumstances, as rightly pointed out by the learned counsel Mr Gobinda Mukhoty the present appellant cannot be held liable for any of the offences of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 378 of 405 which he now stands convicted, in the absence of any reliable evidence that the accused D.N. Singh did everything with the consent or knowledge of the appellant. Evidently, this must have been the reason for exonerating the appellant from any liability in the departmental inquiry. Reading of the judgment of the High Court gives an impression that the learned Judge of the High Court who delivered the judgment clubbing the case of the appellant along with other three cases in which accused D.N. Singh appeared as an appellant probably has been carried away by the abundant materials that are available as against D.N. Singh and fastened the appellant with the criminal charges indicted. But when the evidence is analyzed and carefully examined confining the same with reference to the Special Case No. 5 of 1979 giving rise to Criminal Appeal No. 709 of 1983 before the High Court, we are of the firm view that the evidence is not sufficient to sustain the conviction as against the appellant.
d) Laxmi Narain Kalra v. State of U.P. AIR 1956 SC 544:
6. On behalf of the respondent, Mr Asthana drew our attention to some passages in the evidence of PWs 2 and 3 as showing that Sobhraj was acting under the authorisation of the appellant. PW 2 stated in his examination-in-chief that on 15-
11-1949, Laxmi Narain had told him that Sobhraj was his brother and "that he would come and go in his place as he was engaged in contracts outside at several places". From this it is sought to be argued that a general authority had been given by the appellant to his brother to act for him and that authority included making the representations which he actually did make. We find it very difficult to accept this argument. In cross-examination PW 2 admitted that no writing was taken to show that Sobhraj could work on behalf of the appellant and such a general statement, as is spoken to by him is, in our opinion, wholly insufficient to constitute Sobhraj the authorised representative of the appellant for the purpose of making those representations. PW 3 stated in his evidence that in the beginning Laxmi Narain and Sobhraj both came to him together on the 15th and 16th November and they CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 379 of 405 also came together sometimes even later on. This has little significance seeing that they were brothers and were connected in business. On the other hand, PW 3 said in cross- examination that on 22-11-1949, Sobhraj informed him that Laxmi Narain would come the following day. This appears to us to show that Sobhraj did not possess any authority to make representations on his own responsibility in the matter and that the matter was one for the final decision of Laxmi Narain. We are unable, on this evidence, to hold that Sobhraj had been authorised to make the representations which he did make on behalf of the appellant.
7. There is no other evidence connecting the appellant with what happened on the 22-11-1949. That being so, there is no material on which we can say that the appellant has done anything which brings him within Section 420 of the Penal Code. His conviction under that section must accordingly be quashed.
e) Jethsur Surangbhai v. State of Gujarat 1984 Supp SCC 207 (Three Judge Bench):
9: Having gone through the judgment of the High Court we find ourselves unable to accept the argument of Mr Phadke. The counsel for the appellant rightly argued with great force and vehemence that taking the findings of the High Court ex facie no case of defalcation of Items (2) to (4) has been made out. In our opinion, the contention raised by the counsel for the appellant is well-founded and must prevail. With due respect what the High Court seems to have missed is that in a case like this where there was serious defalcation of the properties of the Sangh, unless the prosecution proved that there was a close cohesion and collusion between all the accused which formed the subject matter of a conspiracy, it would be difficult to prove the dual charges particularly against the appellant (A-1). The charge of conspiracy having failed, the most material and integral part of the prosecution story against the appellant disappears. The only ground on the basis of which the High Court has convicted him is that as he was the Chairman of the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 380 of 405 Managing Committee, he must be held to be vicariously liable for any order given or misappropriation committed by the other accused. The High Court, however, has not referred to the concept of vicarious liability but the findings of the High Court seem to indicate that this was the central idea in the mind of the High Court for convicting the appellant. In a criminal case of such a serious nature mens rea cannot be excluded and once the charge of conspiracy failed the onus lay on the prosecution to prove affirmatively that the appellant was directly and personally connected with acts or omissions pertaining to Items 2, 3 and 4. It is conceded by Mr Phadke that no such direct evidence is forthcoming and he tried to argue that as the appellant was Chairman of the Sangh and used to sign papers and approve various tenders, even as a matter of routine he should have acted with care and caution and his negligence would be a positive proof of his intention to commit the offence. We are however unable to agree with this somewhat broad statement of the law. In the absence of a charge of conspiracy the mere fact that the appellant happened to be the Chairman of the Committee would not make him criminally liable in a vicarious sense for items 2 to 4. There is no evidence either direct or circumstantial to show that apart from approving the purchase of fertilisers he knew that the firms from which the fertilisers were purchased did not exist. Similar is the case with the other two items. Indeed, if the Chairman was to be made liable then all members of the Committee viz. Tehsildar and other nominated members, would be equally liable because all of them participated in the deliberations of the meetings of the Committee, a conclusion which has not even been suggested by the prosecution. As Chairman of the Sangh the appellant had to deal with a large variety of matters and it would not be humanly possible for him to analyse and go into the details of every small matter in order to find out whether there has been any criminal breach of trust. In fact, the hero of the entire show seems to be A-3 who had so stage-managed the drama as to shield his guilt and bring the appellant in the forefront. But that by itself would not be conclusive evidence against the appellant. There is nothing to show that A-3 had CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 381 of 405 either directly or indirectly informed the appellant regarding the illegal purchase of fertilisers or the missing of the five oil engines which came to light much later during the course of the audit. Far from proving the intention the prosecution has failed to prove that the appellant had any knowledge of defalcation of Items 2 to 4. In fact, so far as item 3 is concerned, even Mr Phadke conceded that there is no direct evidence to connect the appellant.
10: In these circumstances, we do not find any justification for the High Court to have interfered with the order of acquittal passed by the Sessions Judge in favour of the appellant and having considered the facts and circumstances of the case, we are clearly of the opinion that the case against the appellant has not been proved beyond reasonable doubt and he was wrongly convicted by the High Court. Even putting the prosecution case at the highest it cannot be said that two views are not reasonably possible.
f) Kehar Singh v. State (Delhi Admn.) (1988) 3 SCC 609 (Three Judge Bench):
"66: In view of what we have noticed, even if the document is accepted to have been written by the accused, still there is nothing in it on the basis of which an inference of conspiracy could be drawn. There must be evidence to indicate that the accused was in agreement with the other accused persons to do the act which was the ultimate object which was achieved on 31-10-1984. This document therefore although described by the learned Judges of the High Court as very important piece of evidence is nothing but a scrap of paper.
70: The only other inference is that he was himself a party to that conspiracy. Otherwise there is no explanation why he should keep on giving statement after statement, that too after 25 days of the incident. ...It clearly shows that he was a convenient witness available to state whatever was desired from him. That he appears to have become wiser CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 382 of 405 day by day and remembered bit by bit, is certainly interesting to remember.
71. It is well settled that even delay is said to be dangerous and if a person who is an important witness does not open his MOUth for a long time his evidence is always looked with suspicion....
74. Before parting with this witness, one more thing may be noted. The High Court, in order to explain that this witness Amarjit Singh did not refer to Balbir Singh in his first statement on 24-11-1984 stated something out of imagination. The High Court has quoted his statement on 24- 11-1984 in these words:
"He is also reported to have said that Beant Singh had wanted to kill Smt Gandhi before August 15 and that he had agreed to do so if grenade and remote control were available."
In this context, the use of the word "agreed" and word "he" the High Court felt that they refer to Balbir Singh and none else. This appears to be an explanation given by Amarjit Singh in his statement in court and the High Court felt that it could accept it. It is clear that where he says "agreed" and "he" in his statement on 24-11-1984 he had not named Balbir Singh at all. It is only now in his statement at trial that he grew wiser and made an attempt by way of this explanation. It is rather unfortunate that the High Court felt that this explanation should be accepted.
264. It is argued that the accused being a police officer did not object to the allegations made against him in the remand application. I do not think that this contention requires serious consideration. The averments in the remand application are only self-serving. The silence of CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 383 of 405 the accused cannot be construed as his admission of those allegations.
276. I share this opinion, but hasten to add that the relative acts or conduct of the parties must be conscientious and clear to mark their concurrence as to what should be done. The concurrence cannot be inferred by a group of irrelevant facts artfully arranged so as to give an appearance of coherence. The innocuous, innocent or inadvertent events and incidents should not enter the judicial verdict. We must thus be strictly on our guard
966. Ld. Counsels also submitted that many of the prosecution witnesses who were crucial were dropped by the prosecution and therefore adverse inference should be drawn against it.
967. Ld. DLA, on the other hand, referred to State through Superintendent of Police, CBI/SIT Vs. Nalini & Ors., (1999) 5 SCC 253 wherein it was observed as under:
"Thus the offence of criminal conspiracy certainly requires a prior agreement between two or more persons to do or cause to be done an illegal act, or an act which is legal by illegal means. However, when it is legal act by illegal means overt act is necessary. It is also equally true that direct evidence of existence of a criminal conspiracy is seldom available and has to be inferred from the over all facts and circumstances of the case. Clearly from the overall facts and circumstances of the present case as already discussed above. It is evident that the accused persons consciously made false representation at different stages of processing of their application for allotment of a coal block in Ministry of Coal.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 384 of 405 Different roles were played by the accused persons in order to support the claim made by each other before different Govt. authorities. The existence of a common agreement amongst the accused persons is thus writ large on the face of record."
968. He also referred to the provisions of S. 120-A and 120-B IPC. The same are as under:
Definition of criminal conspiracy Section 120 A IPC : When two or more persons agree to do, or cause to be done --
(a) an illegal act; or
(b) an act which is not illegal by illegal means, such an agreement is designated a criminal conspiracy:
Provided that no agreement except an agreement to commit an offence shall amount to a criminal conspiracy unless some act besides the agreement is done by one or more parties to such agreement in pursuance thereof.
Explanation -- It is immaterial whether the illegal act is the ultimate object of such agreement, or is merely incidental to that object.
Section 120 B IPC Punishment of criminal conspiracy (1) Whoever is a party to a criminal conspiracy to commit an offence punishable with death, or imprisonment for a term of 2 years or upwards, shall, where no express provision is made in this Code for the punishment of such a conspiracy, be punished in the same manner as if he had abetted such offence.
(2) Whoever is a party to a criminal conspiracy other than a criminal CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 385 of 405 conspiracy to commit an offence punishable as aforesaid shall be punishable with for 10 years and with fine.
969. Ld. DLA submitted that all the accused persons are liable for the offence of conspiracy. He argued that prosecution has proved that there was conspiracy between all the accused persons to the cheat the MoC and the Govt. of India to obtain the allocation of coal block. Specifying role of each accused, ld. DLA submitted that accused A-1 company filed the application for allocation of coal block; accused A-2 got prepared the application form and feedback form; accused A-3 wrote various letters to the PMO and Govt. of Maharashtra; and accused A-4 made the presentation and signed the feedback form. He pointed out that accused public servants A-5 to A-7 failed to ensure that the applications were checked for their completeness and eligibility and made recommendation in favour of an ineligible company. He submitted that all the accused persons acted in conspiracy with each other.
970. On the other hand, Ld. Counsels refuted these submissions contending that there is no evidence of any conspiracy. They contended that there is no evidence of any meeting between the accused persons concerning any conspiracy.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 386 of 405
971. Ld. Counsel for A-5 to A-7 submitted that the misrepresentations were not in the knowledge of these accused persons.
972. In my view it cannot be said that the accused public servants did not know about misrepresentations. A-1 company was a newly incorporated company on 18.12.2006 and as such it was not engaged in any end use as prescribed under CMN Act, 1973 and the advertisement Ex. PW14/B-1 (Colly.).
973. If accused persons claim that IDFC that promoter and/or principal of JLD, thereby meaning that Abhijeet group had nothing to do with it, then JLD was clearly ineligible as Lokmat group and IDFC group were not engaged in any end use prescribed under CMN Act i.e. power in the present case.
974. Further, in the application it was claimed that JLD was promoted, controlled and managed by Lokmat Group and IDFC which was contrary to Memorandum and Articles of Association of JLD [Ex. PW1/C (Colly.)]. Further PW-13 V.K. Jairath had sent letter dt. 23.05.2007 [Ex. PW13/A] to A-5 wherein it was mentioned that Darda Group and Abhijeet Group had joined hands to set up Power Project in Yavatmal. This letter was seen by all A-5 to A-7. Again, during presentation, changes were got made by IDFC in the soft copy. Thus everything was in their knowledge.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 387 of 405
975. It has already been held that A-1 to A-4 did make misrepresentations. A-5 to A-7 assisted them in acheiving the goal of obtaining recommendation and ultimately allocation of a coal block.
976. Having considered the material on record, it is more than apparent that there was consipracy between the accused persons. All the accused acted in concert to achieve the common object of the conspiracy.
977. It is settled law that direct evidence of conspiracy is seldom available as conspiracies are hatched in secrecy. It has to be inferred from the facts and circumstances of the case.
978. In the present case, it has been established that A-1 applied for allocation of coal block vide application Ex. PW-1/B (Colly.); that A-2 had got prepared the said application; that A-4 had attended meeting of the Screening Committee and made presentation and he also signed and submitted the feedback form Ex. PW3/J; and that A-3 had written various letters to the PMO and Govt. of Maharashtra. Further it has been established that A-5 [as Secy. (Coal) and as Chairman, Screening Committee], A-6 [as Jt. Secy. (Coal) and as Convener, Screening Committee] and A-7 [as Director CA-I Section] in MoC failed to ensure that applications were checked for their completeness and CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 388 of 405 eligibility and failed to ensure complaince of guidelines and made recommendation in favour of A-1 company which was ineligible company. All these acts have been fully established. It has further been established that false statements were made in the application, the feedback form and various letters. Prosecution has also established the accused persons dishonestly induced the MoC and the Govt. of India to issue coal block allocation letter.
979. He had also vehemently argued that when the company was intending allocation of Lohara West and Extension block whereas block which was allotted is Fatehpur East, then where is the conspiracy.
980. There is no merit in this contention. In the application itself Fatehpur East coal block was mentioned by the company.
981. From these facts and circumstances, it can be safely inferred conclusively that there was conspiracy amongst them.
982. It is settled position in law that a person can join a conspiracy at any point of time. A person may come and go during the existence of the conspiracy. It is not necessary that a person must be part of the conspiracy from the begining.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 389 of 405
983. Although A-7 became Director CA-I later on, but everything material had happened during his tenure. The applications when they were returned by MoP were sent again to MoP during his tenure. As such, A-7 cannot evade liablility.
984. Earning the recommendation of the Screening Committee was the event which can be said to have achieved the object of the conspiracy. After all, earning the recommendation of the Screening Committee was one of the aims of the conspiracy. Obtaining letter of allocation was the other aim and which was a natural consequence after obtaining recommendation of Screening Committee or atleast the same was facilatated by the recommendation.
985. No adverse inference can be drawn against the prosecution for dropping witnesses as witnesses are not to be counted but evaluated. When the prosecution thinks it has got the evidence from a witness, there is no need to examine witness on repetitive facts. This contention is also rejected.
986. Upon consideration of the entire material, it is held that prosecution has proved that there was conspiracy and accused persons were members of the said conspiracy.
POINT FOR DETERMINATION NO. (a):
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 390 of 405 WAS THERE NO PROPER SANCTION U/S 19 OF PC ACT AND THUS COGNIZANCE WAS BAD AGAINST ACCUSED A-6 AND A-7?
& POINT FOR DETERMINATION NO. (b):
WHETHER COGNIZANCE IS BAD FOR WANT OF SANCTION U/S 197 CRPC?
987. Both these points for determination are taken up together.
988. Ld. Counsel Sh. Rahul Tyagi for the accused public servants contended that there was no sanction u/s 19 of PC against accused A-6 and A-7 and as such cognizance was taken without jurisdiction. He contended that the trial conducted in the absence of the sanctions is void ab initio. He relied upon Nanjappa Vs. State of Karnataka (2015) 14 SCC 186 and A.R. Antulay Vs. S. Nayak & Anr., (1988) 2 SCC 602.
989. Ld. Counsel criticized order dated 22.07.2015 vide which it was ordered that sanction against A-6 and A-7 was deemed to have been granted. Ld. Counsel submitted that reliance placed by the Court on the judgment of Vineet Narain and Others Vs. Union of India and Another, (1998) 1 Supreme Court Cases 226 was misplaced and misconceived. He referred to the recent decision given by Hon'ble Supreme Court in the case of Vijay CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 391 of 405 Rajmohan Vs. CBI (Anti-Corruption Branch), (2023) 1 SCC 329. Hon'ble Apex Court held in this case that delay in grant of sanction by the Competent Authority beyond mandatory period will neither result in quashing of the proceedings nor it will lead to conclusion that sanction has been deemed to have been granted.
990. Hon'ble Supreme Court observed as under:
"23. Noticing that there is no legislation prescribing the period within which a decision for sanction is to be taken, this Court, in Vineet Narain (supra), sought to fill the gap by setting a normative prescription of three months for grant of sanction.
58. (1)(15) Time-limit of three months for grant of sanction for prosecution must be strictly adhered to. However, additional time of one month may be allowed where consultation is required with the Attorney General (AG) or any other law officer in the AG'S office.
. . . . .
. . . . .
31. In the first place, non-compliance with a mandatory period cannot and should not automatically lead to the quashing of criminal proceedings because the prosecution of a public servant for corruption has an element of public interest having a direct bearing on the Rule of law. This is also a non- sequitur. It must also be kept in mind that the complainant or victim has no other remedy available for judicial redressal if the criminal proceedings stand automatically quashed. At the same time, a decision to grant deemed sanction may cause prejudice to the rights of the Accused as there would CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 392 of 405 also be non-application of mind in such cases."
991. It further held that the only course of action available when sanction is not granted in the stipulated time is that the aggrieved party including complainant, accused or victim may approach the writ Court seeking directions for action on the request for sanction. It observed as under:
"37. In conclusion, we hold that upon expiry of the three months and the additional one-month period, the aggrieved party, be it the complainant, accused or victim, would be entitled to approach the concerned writ court. They are entitled to seek appropriate remedies, including directions for action on the request for sanction and for the corrective measure on accountability that the sanctioning authority bears...."
992. He thus submits that it is a case of no sanction against A-6 and A-7 and they must be discharged.
993. Ld. DLA has not disputed the factual position that there was no sanction granted by the Competent Authority and it was only deemed to have been granted vide order dated 22.07.2015 but he submits that the judgment in Vijay Rajmohan (supra) will apply only prospectively. He further submitted that the objections have been raised belatedly and even otherwise there has been no failure of justice. Ld. DLA relied upon Girish Kumar Suneja Vs. CBI, Criminal Appeal No. 1137 of 2017 decided on 13.07.2017 by Hon'ble CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 393 of 405 Supreme Court of India.
994. The answer of Ld. Counsel of the accused public servants is that the judgment in Vijay Rajmohan (supra) will apply retrospectively.
995. Relying upon Dr. Suresh Chandra Verma & Ors Vs. The Chancellor, Nagpur University & Ors., MANU/SC/0351/1990, he submitted that whenever Hon'ble Apex Court interprets a provision of law it declares law as it has been from the inception. Ld. Counsel argued that all declarations of law are retrospective in its application unless specifically declared otherwise. He also relied upon P.V. George and Ors. Vs. State of Kerala and Ors. (2007) 3 SCC 557 in this regard.
996. He further answered that issue of sanction can be raised at any time. He referred to the observations made in the case of Nanjappa (supra).
"13. What is important is that, not only was the grant of a valid sanction held to be essential for taking cognizance by the Court,but the question about the validity of any such order, according to this Court, could be raised at the stage of final arguments after the trial or even at the appellate stage. This Court observed:
"Ordinarily, the question as to whether a proper sanction has been accorded for prosecution of the accused persons or not is a matter which should be dealt with at the stage of taking cognizance. But in a case of this nature where a question is raised as to whether the authority granting the sanction CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 394 of 405 was competent therefore or not, at the stage of final arguments after trial, the same may have to be considered having regard to the terms and conditions of service of the accused for the purpose of determination as to who could remove him from service.
Grant of proper sanction by a competent authority is a sine qua non for taking cognizance of the offence. It is desirable that the question as regard sanction may be determined at an early stage. But, even if a cognizance of the offence is taken erroneously and the same comes to the court's notice at a later stage a finding to that effect is permissible. Even such a plea can be taken for the first time before an appellate court."
(Empasis supplied)
997. Regarding no failure of justice shown by the accused, Ld. Counsel for the accused public servants submitted that reliance on Girish Kumar Suneja (supra) by the prosecution is misplaced. He submitted that Hon'ble Supreme Court was not dealing with the issue of deemed sanction. He contended that the requirements of showing failure of justice by the accused with a reference to S. 19(3) of PC Act is only in the cases of appeal or revision or confirmation proceedings. Ld. Counsel pointed out that a separate application has also been filed in this regard.
998. When my Ld. Predecessor passed the order dated 22.07.2015 deeming that sanction had been granted, it must be noticed that it was a possible course of action. My Ld. Predecessor had relied upon Subramanian Swamy CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 395 of 405 Vs. Manmohan Singh & Another, (2012) 3 SCC 64.
999. Thus the said order can not be faulted with now. Moreover, what is important is that none of the accused public servants had challenged the said order dated 22.07.2015 at any point of time. They participated in the trial and now when the matter was at the final stage, they have come up with this plea. The judgment of Vijay Rajmohan (supra) has been delivered recently. Therefore to my mind there is nothing wrong with the order dated 22.07.2015. Further accused public servants have not shown that any prejudice has been caused to them.
1000. There is another important aspect. This plea was raised for the first time when the matter was at the stage of final arguments. It is obvious that the provision of Sec. 19 of the PC Act is in nature of shield for public servants to save them from frivolous prosecutions. It is also notewothy that the requirement of sanction is at the time of taking cognizance. It is so because the protection will become ineffective if criminal prosecutions are allowed to begin and then later on decision is taken regarding protection of public servants. This course of action will make the protection ineffective and useless. With aim of providing protection at the very threshhold, requirement of sanction was provided at the time of taking cognizance.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 396 of 405 1001. In the present case, deemed sanction was ordered before taking cognizance. The accused public servants appeared and participated in the proceedings. They did not raise any objection that cognizance was taken against them without sanction or that the order providing for deemed sanction was bad. They continued participating in the trial. And now when the matter has reached the final stage, they have come with this plea and filed an application in this regard. It appears that this application would not have been filed if the judgment in Vijay Rajmohan had not come. 1002. Ld. Counsel for accused public servants is right in submitting that question whether there occurred failure of justice or not due to absence of, or error in, any sanction is a matter to be seen by appellate court or revisional court. However, considering the facts and circumstances of the case, it is held that there is no error in order providing for deemed sanction. 1003. Ld. Counsel for the accused public servants also focused on the lack of sanction u/s 197 CrPC. He relied upon A. Srinivasulu Vs. The State Rep. by the Inspector of Police 2023 Live Law SC 485 and contended that sanction u/s 197 CrPC was must. He also relied upon R. Balakrishna Pillai Vs. State of Kerala, (1996) 1 SCC 478 and State of Madhya Pradesh Vs. Sheetla Sahai & Ors., MANU/SC/1425/2009 also.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 397 of 405 1004. Ld. DLA has replied that the issue regarding lack of sanction u/s 197 CrPC was raised at the time of charge also and was decided against the accused persons. He also relied upon Parkash Singh Badal Vs. State of Punjab & Ors. MANU/SC/5415/2006 and contended that entering into conspiracies can not be considered as an act performed during the discharge of official duties and as such there was no requirement of sanction u/s 197 CrPC. He contended that the present case is a case of abuse of power and as such no protection is available to the accused public servants u/s 197 CrPC. He relied upon Chaudhary Parveen Sultana Vs. State of WB, 2009 CriLJ 1318. 1005. Ld. Counsel for the accused persons refuted these contentions and submitted that the judgment in the Prakash Singh Badal (supra) was already discussed and clarified in the judgment of A. Srinivasulu (supra). He referred to the following observations:
"47. For the purpose of finding out whether A-1 acted or purported to act in the discharge of his official duty, it is enough for us to see whether he could take cover, rightly or wrongly, under any existing policy. Paragraph 4.2.1 of the existing policy extracted above shows that A-1 at least had an arguable case, in defence of the decision he took to go in for Restricted Tender. Once this is clear, his act, even if alleged to be lacking in bona fides or in pursuance of a conspiracy, would be an act in the discharge of his official duty, making the case come within the parameters of Section 197(1) of the Code. Therefore, the prosecution ought to have obtained previous sanction.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 398 of 405 The Special Court as well as the High Court did not apply their mind to this aspect.
48. Shri Padmesh Mishra, learned counsel for the respondent placed strong reliance upon the observation contained in paragraph 50 of the decision of this Court in Parkash Singh Badal vs. State of Punjab. It reads as follows:-
"50. The offence of cheating under Section 420 or for that matter offences relatable to Sections 467, 468, 471 and 120-B can by no stretch of imagination by their very nature be regarded as having been committed by any public servant while acting or purporting to act in discharge of official duty. In such cases, official status only provides an opportunity for commission of the offence."
49. On the basis of the above observation, it was contended by the learned counsel for the respondent that any act done by a public servant, which constitutes an offence of cheating, cannot be taken to have been committed while acting or purporting to act in the discharge of official duty.
50. But the above contention in our opinion is far-fetched. The observations contained in paragraph 50 of the decision in Parkash Singh Badal (supra) are too general in nature and cannot be regarded as the ratio flowing out of the said case. If by their very nature, the offences under sections 420, 468, 471 and 120B cannot be regarded as having been committed by a public servant while acting or purporting to act in the discharge of official duty, the same logic would apply with much more vigour in the case of offences under the PC Act. Section 197 of the Code does not carve out any group of offences that will fall outside it purview. Therefore, the observations contained in para 50 of the decision in Parkash Singh Badal cannot be taken as carving out an exception judicially, to a statutory prescription. In fact, Parkash Singh Badal cites with approval the other decisions (authorised by the very same learned Judge) where this Court made a distinction between an act, though in excess of the duty, was reasonably connected with the discharge of official duty and an act which was merely a CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 399 of 405 cloak for doing the objectionable act. Interestingly, the proposition laid down in Rakesh Kumar Mishra (supra) was distinguished in paragraph 49 of the decision in Parkash Singh Badal, before the Court made the observations in paragraph 50 extracted above.
51. No public servant is appointed with a mandate or authority to commit an offence. Therefore, if the observations contained in paragraph 50 of the decision in Parkash Singh Badal are applied, any act which constitutes an offence under any statute will go out of the purview of an act in the discharge of official duty. The requirement of a previous sanction will thus be rendered redundant by such an interpretation."
1006. Ld. Counsel thus argued that prosecution for offences under IPC without sanction under 197 CrPC is bad in law. He submitted that protection of Section 197 CrPC was available even to A-5 H.C. Gupta who had retired. 1007. My Ld. Predecessor has already dealt with the aspect of sanction u/s 197 CrPC at the time of order on charge. He has already observed that the alleged acts as committed by A-5 to A-7 can not be called to have been done by them in the discharge of official duties or in the purported discharge of their official duties. He has held that their offices merely provided them an opportunity to commit such acts of misdemeanour.
1008. In my view also, the acts of commissions and omissions of the accused public servants are the ones which helped in the achievement of the CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 400 of 405 object of the criminal conspiracy. It is also to be kept in mind that whether the sanction u/s 197 CrPC was required or not is to be considered at the stage of taking cognizance and, therefore, the allegations as they stood on that date are to be taken note of. As on the date of cognizance, considering the allegations against accused public servants, their acts and omissions are not such which can be said to have been performed in the discharge of official duties. 1009. Now after having found these accused public servants have committed offences as already discussed, it has become all the more clear that there was no requirement of sanction u/s 197 CrPC.
1010. The various acts of omission and commission as were committed by the accused public servants cannot be stated to have been committed by them while acting or purporting to act in the discharge of their official duties. In fact it was their position as such public servants which provided them the opportunity to commit such acts of omission and commission while choosing to enter into a criminal conspiracy with the private parties involved and it cannot be stated that they so acted either in the discharge of their official duties or in the purported discharge of their official duties.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 401 of 405 1011. In the case Rajib Ranjan & Ors vs R. Vijay Kumar, (2015) 1 SCC 513 and Inspector of Police & Anr. Vs Battenapatla Venkata Ratnam & Anr., C.A. No. 129 of 2013 (SC), it has been categorically held by Hon'ble Supreme Court that when a public servant enters into a criminal conspiracy or indulges in criminal misconduct, such misdemeanour on his part is not to be treated as an act in discharge of his official duties and therefore, provisions of Section 197 CrPC will not be attracted. Reference in this regard can also be had to K. Satwant Singh vs State of Punjab, 1960 (2) SCR 89; Amrik Singh vs State of Pepsu, 1955 (1) SCR 1302 and Om Prakash Gupta vs State of U.P., 1957 SCR 423.
1012. There is another aspect of the present matter. Since the role attributed to the accused public servants A-6 and A-7 in the entire criminal conspiracy is clearly traceable to the offences u/s 13(1)(d) PC Act, 1988 allegedly committed by them so for any conspiracy to commit any such offence under Prevention of Corruption Act, 1988, no sanction u/s 197 Cr. PC can be held to be required. Thus the offence of criminal conspiracy i.e. u/s 120-B IPC qua these public servants in question related to the offence of criminal misconduct i.e. u/s 13(1)(d) PC Act, 1988.
CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 402 of 405 1013. Further as A-4 H.C. Gupta had since retired from Govt. service so no sanction u/s 19 PC Act, 1988 was required for taking cognizance of the offences under PC Act. However, as the very acts which were committed by A- 5 H.C. Gupta were primarily also on account of offence relating to corruption, therefore, those acts can not be termed as acts done in the discharge of his official duties warranting any requirement of sanction u/s 197 Cr.PC qua him also. Consequently no sanction u/s 197 Cr. PC is required for the offence of criminal conspiracy to commit any offence under IPC or PC Act, 1988 qua either of the three accused MoC officers.
1014. Ld. Counsel for the public servants while relying upon the case N. K. Ganguly Vs. CBI (2015) SCC On-line SC 1205 however strongly argued that for the acts allegedly committed by the accused public servants no cognizance of the offences under IPC can be taken without a prior sanction u/s 197 Cr.PC. However, I may observe that in the N. K. Ganguly case (Supra), Hon'ble Supreme Court has primarily reiterated the basic principle of law that for an act which is alleged to have been committed in discharge of official duty by accused the previous sanction u/s 197 CrPC is a pre-requisite condition. However the various acts of omission and commission committed by the accused public servants and as discussed at length in the present judgment can CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 403 of 405 not be said to have been committed by the accused MoC officers in the discharge of their official duties. As already discussed above the facts of the present case clearly show that A-4 H.C. Gupta, A-5 K.S. Kropha and A-6 K.C. Samria entered into a criminal conspiracy with company A-1 M/s JLD Yavatmal Energy Pvt. Ltd. and its Directors A-2 Manoj Kumar Jayaswal, A-3 Vijay Darda and A-4 Devender Darda so as to procure allocation of Fatehpur East coal block in favour of A-1 company. Thus the said acts of entering into a criminal conspiracy to commit offence of criminal misconduct as defined under Prevention of Corruption Act, 1988 cannot be deemed to have been done in discharge of their official duty by the accused MoC officers. 1015. Thus, in view of the above discussion, it is clear that there was no requirement of sanction u/s 197 Cr. PC in the present matter. 1016. The application of the accused public servants in this regard stands dismissed.
FINDINGS:
1017. In view of the above discussion, it is held that the prosecution has proved the charges. All the accused persons i.e. the company M/s JLD Yavatmal Energy Pvt. Ltd. (A-1), its three directors Manoj Kumar Jayaswal CBI Vs. M/s JLD & Ors. Judgment Dt. 13.07.2023 Page No. 404 of 405 (A-2), Vijay Darda (A-3) and Devender Darda (A-4) and the three accused public servants H.C. Gupta (A-5), K.S. Kropha (A-6) and K.C. Samria (A-7) are hereby held guilty and convicted for the offence u/s 120-B IPC and 120-B r/w 420 IPC & S. 13(1)(d)(iii) PC Act.
1018. Further accused M/s JLD Yavatmal Energy Pvt. Ltd. (A-1), Manoj Kumar Jayaswal (A-2), Vijay Darda (A-3) and Devender Darda (A-
4) are also held guilty and convicted for the substantive offence u/s 420 IPC.
1019. Further accused H.C. Gupta (A-5), K.S. Kropha (A-6) and K.C. Samria (A-7) are also held guilty and convicted for the substantive offence punishable u/s 13(1)(d)(iii) r/w S. 13(2) of the PC Act. 1020. However, accused H.C. Gupta (A-5) is acquitted for the offence punishable u/s 409 IPC and u/s 13(1)(c) PC Act.
1021. Let the convicts be heard on sentence. Digitally signed by SANJAY SANJAY BANSAL BANSAL Date:
Announced in the Open Court 2023.07.15
21:59:07
on this 13th Day of July, 2023 +0530
(Sanjay Bansal)
Special Judge, (PC Act)(CBI),
(Coal Block Cases)-02,
Rouse Avenue District Courts,
New Delhi: 13.07.2023.
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