Sri J M Vrushabhendraiah vs The State Of Karnataka on 4 March, 2026

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Karnataka High Court

Sri J M Vrushabhendraiah vs The State Of Karnataka on 4 March, 2026

Bench: M.Nagaprasanna

IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 04TH DAY OF MARCH, 2026

BEFORE

THE HON'BLE MR. JUSTICE M. NAGAPRASANNA

CRIMINAL PETITION No.3876 OF 2022

BETWEEN:

SRI J.M.VRUSHABHENDRAIAH
S/O LATE MALIYAPPAIAH
AGED ABOUT 76 YEARS
R/O SRI.GURU KRUPA FARM
KUDLIGI ROAD, SANDUR,
BELLARY DISTRICT - 583 119.
... PETITIONER
(BY SRI HANUMANTHA REDDY Y.S., ADVOCATE)

AND:

THE STATE OF KARNATAKA
SPECIAL INVESTIGATION TEAM
KARNATAKA LOKAYUKTA
BENGALURU - 560 001

REPRESENTED BY
STATE PUBLIC PROSECUTOR
HIGH COURT OF KARNATAKA AT
BENGALURU - 560 001.
... RESPONDENT

(BY SRI VENKATESH ARBATTI, SPL.PP FOR R-1;
R-2 TO R-6 ARE DELETED VIDE ORDER DATED 28.02.2024)
2

THIS CRIMINAL PETITION IS FILED UNDER SECTION 482 OF
CR.P.C., PRAYING TO (a) QUASH THE FINAL REPORT / CHARGE
SHEET, IN CRIME NO. 23/2015, ON THE FILE OF THE XXIII
ADDITIONAL CITY CIVIL SESSIONS JUDGE AND SPECIAL JUDGE,
FOR PREVENTION OF CORRUPTION ACT, AT BENGALURU, VIDE
ANNEXURE-B, TO THE PETITION; (b) CONSEQUENTLY, QUASH THE
ENTIRE PROCEEDINGS AGAINST THE PETITIONER (ACCUSED NO.
1), IN SPECIAL CC NO. 148/2022, WHICH IS PENDING ON THE FILE
OF THE XXIII ADDITIONAL CITY CIVIL SESSIONS JUDGE AND
SPECIAL JUDGE, VIDE ANNEXURE C, TO THE PETITION.

THIS CRIMINAL PETITION HAVING BEEN HEARD AND
RESERVED FOR ORDERS, COMING ON FOR PRONOUNCEMENT THIS
DAY, THE COURT MADE THE FOLLOWING:-

CORAM: THE HON'BLE MR JUSTICE M.NAGAPRASANNA

CAV ORDER

The petitioner/accused No.1 is before this Court calling in

question proceedings in Special C.C.No.148 of 2022 arising out of

Crime No.23 of 2015 registered for offences punishable under

Sections 109, 379, 409, 468, 471 r/w 120B of the IPC and Sections
3

21, 23 r/w 4(1) and 4(1a) of the Mines and Minerals (Development

and Regulation) Act, 1957 ('the Act' for short).

2. Heard Sri Y. S. Hanumantha Reddy, learned counsel

appearing for the petitioner and Sri Venkatesh Arabatti, learned

Special Public Prosecutor appearing for the respondent.

3. Facts, in brief, germane are as follows: -

3.1. A mining lease comes to be granted to the petitioner/

accused No.1 in the year 1993 by the Government of Karnataka for

a land measuring 3.36 hectares/8.13 acres in Sy.No.19 of Ramghad

Village, Sandur Taluk, Bellary District to extract iron ore and red

oxide. The mining lease was for a period of 20 years. The process of

extraction of iron ore in terms of the lease was carried out by

M/s Srinivasa Minerals Trading Company who is accused No.3 and

its partner one Y.Srinivasa Rao/accused No.2. Between May 2009

and December 2010, it is the allegation that accused No.3 being

hand in glove with the petitioner/accused No.1 carried out illegal

extraction of iron ore without any permit as stipulated under the

Act.
4

3.2. During the course of investigation on the said allegation,

it was found that the Department of Mines and Geology had issued

permits in favour of accused No.1 favouring accused No.3 to extract

and transport iron ore to various locations. However, there were no

permits granted to extract iron ore or transport it to Krishnapatnam

Port. On 10-09-2009 accused No.1 submits a request to the

Controller General, Indian Bureau of Mines for temporary

discontinuance of the mines in the light of illegal mining activity

surrounding the petitioner/accused No.1 mining lease. Accordingly

Form-F which is the prescribed format was submitted for temporary

discontinuance of mines or mining lease.

3.3. On 07-09-2015, pursuant to the directions of the Apex

Court and constitution of the SIT in terms of the directions, a crime

in Crime No.23 of 2015 comes to be registered against several

persons including Mr. G.Janardhan Reddy and all others in the same

mining area. The SIT conducts investigation and files the charge

sheet against all indulging the petitioner/accused No.1. Filing of the

charge sheet is what has driven the petitioner to this Court in the

subject petition.
5

4. The learned counsel appearing for the petitioner would

vehemently contend that the allegations in the FIR and the charge

sheet is that the petitioner has entered into an agreement with M/s

Madhushree Enterprises and the petitioner's mine was virtually

taken over by other accused mining group which led to large scale

illegal extraction of iron ore transportation and trading of the said

produce. It is his submission that the petitioner once having

entered into an agreement and the land being taken over by M/s

Madhushree Enterprises, the petitioner cannot be hauled into the

proceedings. It is his submission that the allegations against the

petitioner regarding entering into agreement with M/s Madhushree

Enterprises has already been investigated by the CBI, when the CBI

summoned the petitioner and detailed statement was recorded. The

CBI chose not to proceed against the petitioner after recording the

statement. The SIT again, on the score that a new crime is

registered, repeated the same exercise by proceeding that the

petitioner has caused loss to the State exchequer. The learned

counsel submits that the petitioner is neither an exporter nor a

trader nor has extracted iron ore nor exported any ore. The
6

petitioner is deliberately dragged into the offence, since he did have

a mining lease at some point in time.

5.1. Per contra, the learned counsel appearing for the

respondent/SIT would vehemently refute the submissions to

contend that during the course of investigation it was found that

accused No.3 Company colluded with the petitioner/accused No.1

and extracted iron ore illegally without any permit. The iron ore

was extracted from the mines that was leased to the petitioner and

transported to an unauthorized stockyard by accused No.3. The

stockyard was Krishnapatnam Port, to which iron ore was

transported by the Apex Cargo Carriers on behalf of accused No.3.

Further about 78,772 MTs of iron ore was exported from the said

Port. Permits were granted to the petitioner in favour of accused

No.3 for the period from May 2009 to December, 2010 and mining

activity went on during this period, all of which are illegal. The

petitioner made a request for temporary closure of the mine on

10-09-2009 by then 66,264 MTs of iron ore was already illegal

extracted from the mine head and transported and exported to the

said Port.
7

5.2. The learned counsel submits that the investigation

conducted by the CBI was with regard to export of iron ore from

Belekere Port and does not pertain to the present case against the

petitioner. Likewise, the investigation conducted by the COD also

did not pertain to the present case. It is for the first time, the

petitioner comes into the picture and a crime is registered. The

question of delay would not arise, as the offence punishable is an

amalgam of Section 409 of the IPC as well, which would be

imprisonment up to 10 years.

6. I have given my anxious consideration to the submissions

made by the respective learned counsel and have perused the

material on record. The issue is whether the proceedings against

the petitioner/accused No.1 deserve to be obliterated?

7. The afore-narrated facts and the link in the chain of events

are all a matter of record. A crime comes to be registered in Crime

No.23 of 2015. The allegation against the petitioner in the said

crime is as follows:
8

".... .... ....

Shri J.M.Vrushabendraiah was granted mining lease
for extracting iron ore and red oxide in Sy.No.19 of
Ramgad village, Sandur taluk, Bellary district on 24-08-
1993 for a period of 20 years vide M.L.No.2173 for an
extent of 3.36 ha. As per the findings of Forest
Department, the lease holder had encroached into
neighbouring forest area to an extent of 14.31 ha (5.94
ha for working pit outside the leased area and 8.37 for
waste dumps outside the leased area). In pursuance to
this, a case was filed by Forest Department in FOC
No.47/48/08-in Sandur village. Later on 29-03-2009 a
joint survey conducted by the official of Mines and
Geology Department, Forest Department and Revenue
Department confirming the encroachment to the extent of
14.31 ha by the lease holder. At this stage, the mining
group mentioned above conspired to gain control over
the mine.

In pursuance of the same, a Memorandum of
Understanding was executed on 18-06-2009 between
Shri J.M.Vrushabendraiah (first party) and M/s.
Madhushree Enterprises, Bellary, represented by its
partner Shri Madhukumar Verma (second party).
According to the MOU, the second party was to extend to
the first party its knowledge, expertise and technical
knowhow for carrying out the mining operations in a
more systematic and scientific manner. In turn, the first
party agreed to pay consideration to the second party by
way of 40% of the quantity of ore mined from the leased
area. The agreement appears suspicious as the scope of
work of the second party was vague and did not appear
to be commensurate with the quantum of consideration.
Further the second party i.e. M/s. Madhushree Enterprises was
registered as a partnership firm on 04-04-2009 and was only
two months old at the time of signing the MOU and hence did
not possess the required technical expertise and knowhow as
claimed in that document. From the records seized by Income
Tax Department, it is revealed M/s. Madhushree Enterprises was
the front company employed by the afore mentioned mining
group for controlling this mine and one Shri Srinivas was
9

deputed as raising contractor for undertaking extraction of iron
ore on its behalf.

In pursuance of the MOU, during the period from
May to December 2009, about 2,30,681 MT iron ore was
extracted from that mine (which was in excess of
1,50,000 MT annual limit fixed while granting
environmental clearance) and also by encroaching into
the neighbouring forest area. It is also revealed from the
seized documents that from the extracted iron ore,
dispatches were made to M/s. Sri Srinivasa Mineral
Trading Company (1,76,649 MT dispatched from May to
December 2009) and Shri Madhushree Enterprises
(25,011 MT dispatched from June to December 2009),
which were both middle traders controlled by the above
mentioned mining group. Totally during the period from May
to December 2009, 2,49,937 MT of iron ore was dispatched
from this mine. Therefore iron ore to the extent of 1,24,937 MT
was mined and transported from this mine without valid
permits. It is also revealed from the seized documents that
around 67,000 MT iron ore sold to M/s. Sri Srinivasa Mineral
Trading Company (SSMT) was transported to Krishnapatnam
port and during 2009 that company exported 80,000 MT from
that port. So this entire export appears to be made out of
illegally mined and transported iron ore. Further on examination
of the bank account of M/s. Madhushree Enterprises (A/c
No.202010112670 of ING Vysya Bank, Bellary), it is seen that
an amount of ₹80,00,000 was received on 11-09-2009 through
cheque No.731981 of SBI bank account of M/s.SSMT. Thus it is
clear that M/s. Madhushree Enterprises, the front firm,
belonging to the above mentioned mining group, controlled the
mine and received huge money by sale of illegally extracted iron
ore. On examination of the same bank account belonging to
M/s. Madhushree Enterprises, it is seen that huge financial
transactions existed with M/s.Devi Enterprises of Shri K.M.Ali
Khan, M/s. Manjunath Transport of Shri Karapudi Mahesh and
other firms that were directly or indirectly connected to the
mining group mentioned above.

Further, it is revealed that the controlling firm, M/s.
Madhushree Enterprises, employed two persons, Shri.
Ramakrishna Raju and Shri. Noori Moham, to manage and
control this mining lease. Salaries to these employees and
10

relevant professional tax were paid by M/s. Madhushree
Enterprises during the period from June 2009 to January 2010.

.... .... ....

Thus, the mining group comprising of Shri
G.Janardhan Reddy, Shri K.M.Ali Khan, Shri Madhu Kumar
Verma, Shri K.V.Nagaraju @ Swastik Nagaraj, Shri
Karapudi Mahesh, and others and other unknown public
servants conspired together and as a result of the said
conspiracy Shri J.M.Vrushabendraiah entered into illegal
agreement for transfer of iron ore with M/s. Madhushree
Enterprises belonging to Sri Madhukumar Verma as a
consideration for offering technical expertise. As a result
of this agreement, the mine belonging to Shri J.M.
Vrushabendraiah (ML No.2173) was virtually taken over
by the said mining group leading to large scale illegal
extraction, transportation and trading of illicit iron ore
causing huge loss to the State Government exchequer.
During the period from May 2009 to December 2009,
about 1,24,937 MT of iron ore was thus illegally
extracted, transported and traded by resorting to
encroachment, theft and misappropriation, thereby
cheating Government of Karnataka and causing it huge
financial loss to the extent of ` 31,23,42,500 (@₹2,500
per MT) resulting from loss of iron ore and corresponding
loss of royalty and other taxes."

It is the allegation that the mining group comprising of Mr. G.

Janardhana Reddy and several others and unknown public servants

conspiring together have entered into an illegal agreement with the

petitioner for extraction of iron ore with technical expertise of one

M/s Madhushree Enterprises offered as consideration in terms of

the said agreement. As a result of this agreement, the mine
11

belonging to the petitioner was virtually taken over by the mining

group leading to large scale extraction, transportation and trading

illegally. Therefore, the crime comes to be registered. The SIT

conducts investigation and files the charge sheet. Insofar as the

petitioner is concerned finding in the charge sheet is as follows:

".... .... ....

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ವರ

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12

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1) H,ೕ ಹ ಾಸಲು ]ಾ,` gೕ[ ಏಜಂ[:

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13

ಾ ಾ ೆ Nೆಚq ರೂ 37,12,130.00 ಸದ rತOದ ಹಣವನು0 ||ಎ ಎ ಎಂ ! ರವರು
ತಮj 7ೆಸ ನ)*ರುವ 7ೊಸ ೇ]ೆಯ ಆಂಧ, =ಾ ಂ .ಾaೆ ನಂ 020411011000938 Xಂದ
ಹ ಾಸಲು ರವರ .ಾaೆ ನಂ 020411011001253 ೆ ಸಂ ಾಯ 5ಾFರುaಾOAೆ."

Petitioner is accused No.1. The agreement was entered into with

accused No.3. Therefore, the findings against accused Nos.1, 2 and

3 together are necessary to be considered:

"ಅ%ೆtW-1
ಅ%ೆtW

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ೆ

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ಎಂ ವೃಷ=ೇಂದ,ಯ ೖ` . (ಎಂಎL
ಎಂಎL ನಂ 2173)

ಇವರು ಎಂ.ಎL.ನಂ. 2173 ಗ ಗುGO ೆ ಪ, ೇಶದ 5ಾ)ೕಕAಾJದುD, 2009-10%ೇ
ಾ)ನ)* ಆAೋz-3 ॥ H,ೕ H,ೕ3Nಾಸ ZನರL ]ೆ,ೕFಂ^ ಕಂಪ3ಯ ಾಲು ಾರAಾದ ಆAೋz-2
H,ೕ ॥H,ೕ3NಾಸAಾ{ ರವAೊಂ ೆ ೇ ಒಳಸಂಚು 5ಾF ಎಂ.ಎL.ನಂ 2173 ಗ ಗುGO ೆ ಪ, ೇಶ
7ಾಗೂ ಅದ ೆm 7ೊಂ ೊಂFರುವ ಪ, ೇಶಗRಂದಲೂ, ಸಂಬಂಧಪಟC ಇIಾ.ೆXಂದ ;ಾವh ೇ
ಪರNಾ3 ೆಯನು0 ಪ9ೆಯ ೇ ಅನ:ಕೃತNಾJ ಗ ಾ ೆ 5ಾF ಕ ಣದ ಅ ರನು0 ಉaಾuದ%ೆ 5ಾF,
7ೋರ ೇಶ ೆm ರ}O 5ಾಡಲು ಅನುವh 5ಾF ೊ Cರುವh ಾJ ತ3.ಾ ಾಲದ)* ದೃಡಪ CರುತO ೆ. ಗ
5ಾ)ೕಕAಾದ ಆAೋz-1 H,ೕ Yೆ.ಎಂ ವೃಷ=ೇಂದ,ಯ ರವರು ಆAೋz-2 H,ೕ Nೈ.H,ೕ3NಾಸAಾ{
ರವAೊಂ ೆ ~ಾZೕIಾJ ಅಕ,ಮ Iಾಭ 5ಾF ೊಳTxವ ಉ ೆDೕಶ ಂದ ಒಳಸಂಚು ರೂz! ಅಕ,ಮNಾJ
66,264 ಎಂ. ಪ,5ಾಣದ ಕ ಣದ ಅ ರನು0 ಕಳxತನ ಂದ ಗ ಾ ೆ 5ಾF ಾ ಾಟ ಮತುO
5ಾAಾಟ 5ಾಡುವhದ ೆm ಅನುವh 5ಾF ೊಟುC ಅಕ,ಮ IಾಭಗR! ಸ ಾ ರ ೆm ೊ,ೕಹವ%ೆ0ಸJ
ಸ ಾ ರದ =ೊಕmಸ ೆm ರೂ 6,50,56,065/-ರಷುC ಆ• ಕ ನಷCವನು0ಂಟು 5ಾFರುವhದು
ಾ€aಾJರುತO ೆ.

ಆದD ಂದ ೕಲmಂಡ ಆAೋz-1
ಆAೋz H,ೕ Yೆ.ಎಂ
Yೆ ಎಂ.
ಎಂ Nೈಷ=ೇಂದ,ಯ ರವರ ರುದ" •ಾರGೕಯ ದಂಡ
ಸಂ‚aೆ ಕಲಂ 379, 409, gÉ/ 120 ಐz!,
ಐz!, Yೊaೆ ೆ ಕಲಂ 21, 23, 4(1) 4(1J) ಎಂಎಂFಆW ಆ C
-1957 ರ ಅFಯ)* H...ಾಹ ಅಪAಾಧ NೆಸJರುaಾOAೆಂದು ೋ@ಾAೋಪBೆ.
ೋ@ಾAೋಪBೆ
14

ಎ-2 H,ೕ Nೈ H,ೕ3Nಾಸ Aಾ{ ` Nೈ ಉ5ಾ ಮ7ೇಶ†ರAಾ{ ವಯಸು 45 ವಷ , Nಾಸ Nಾ‡
ನಂ 31, Nೇ ಾನಂದ ನಗರ ಾIೋ3,
ಾIೋ3 ಸಂಡೂರು ರ ೆO, 7ೊಸ ೇ]ೆ,
ೇ]ೆ ಾಲು ಾರರು || H,ೕ
H,ೕ3Nಾಸ ZನರL ]ೆ,ೕFಂ^ ಕಂಪ3,
ಕಂಪ3 ೆCೕಷ` ರ ೆO, 7ೊಸ ೇ]ೆ.
ೇ]ೆ

ಇವರು ॥ H,ೕ H,ೕ3Nಾಸ ZನರL ]ೆ,ೕFಂ^ ಕಂಪ3ಯ ಾಲು ಾರAಾJದುD
ಾರAಾJದುD, 2009-10%ೇ
%ೇ
ಾ)ನ)* ಎಂ.ಎL
ಎಂ ಎL.ನಂ
ಎL ನಂ.
ನಂ 2173 ಗ ಪ, ೇಶದ 5ಾ)ೕಕAಾJದD ಆAೋz-1
ಆAೋz H,ೕ
Yೆ.ಎಂ
Yೆ ಎಂ.ವೃಷ=ೇಂದ,ಯ
ಎಂ ವೃಷ=ೇಂದ,ಯ ರವರ Yೊaೆ ೇ ೊಂಡು,
ೊಂಡು ಅವರ ಎಂಎL ನಂ:2173
ನಂ ೆ ಸಂಬಂ:!ದ
ಗ ಗುGO ೆ ಪ, ೇಶ ಂದ 7ಾಗೂ ಅದ ೆm 7ೊಂ ೊಂFರುವ ಪ, ೇಶಗRಂದಲೂ ಸಂಬಂಧಪಟC
ಇIಾ.ೆXಂದ ;ಾವh ೇ ಪರNಾ3 ೆಯನು0 ಪ9ೆಯ
ಪ9ೆಯ ೇ ಅನ:ಕೃತNಾJ ಕಳxತನ ಂದ ಗ ಾ ೆ
5ಾF ಕ ಣದ ಅ ರನು0 ಉaಾuದ%ೆ 5ಾF,
5ಾF 7ೋರ ೇಶ ೆm ರ}O 5ಾFರುವhದು ತ3.ಾ ಾಲದ)*
ದೃಡಪ CರುತO ೆ.ೆ ಕಳವh 5ಾFರುವ ಅಕ,ಮ ಅ ರನು0 ಸಕ,ಮNಾJ ಖ ೕ !ರುವh ೆಂದು ಂ ಸಲು
ಇವರು ॥ y.ಆWಎಂ ! 5ಾ)ೕಕAಾದ H,ೕ. ಮ%ೋˆ ಕು5ಾW Yೈ`(ಎ-4), ॥ ಹನು5ಾ`

]ೆ,ೕಡ 5ಾ)ೕಕAಾದ H,ೕ ಚಂದ,~ೇಖರ AೆF‰(ಎ-5) 7ಾಗೂ ॥ 3ೕಲಕಂಠ ZನರL ನ
5ಾ)ೕಕAಾದ H,ೕ ‹ರುಕ ರಪu(ಎ-6) ರವAೊಂ ೆ ಸಂಚು ಹೂF ಸುಳTx ಇ%ಾ†AiÀiïìUÀಳನು0 ಪ9ೆದು
ಸ ಾ ರ ೆm 7ಾಗೂ ~ಾಸನಬದD ಾ,: ಾರ ೆm rೕಸ 5ಾFರುaಾOAೆ. ಗ 5ಾ)ೕಕAಾದ ಆAೋz-1
ಆAೋz H,ೕ
Yೆ.ಎಂ
Yೆ ಎಂ.ವೃಷ=ೇಂದ,ಯ
ಎಂ ವೃಷ=ೇಂದ,ಯ ರವAೊಂ ೆ ಅAೋz-2
ಅAೋz H,ೕ Nೈ H,ೕ3NಾಸAಾ{ರವರು
H,ೕ3NಾಸAಾ{ರವರು ~ಾZೕIಾJ
M¼À¸ÀAZÀÄ ªÀiÁr ಅಕ,ಮ Iಾಭ 5ಾF ೊಳTxವ ಉ ೆDೕಶ ಂದ 66,264 ಎಂ.
ಎಂ ಪ,5ಾಣದ ಅ ರನು0
ಗ ಾ ೆ 5ಾF ಅಕ,ಮNಾJ
ಅಕ,ಮNಾJ ಾ ಾಟ ಮತುO 5ಾAಾಟ 5ಾFರುವhದ ಂದ ತನ ೆ 7ಾಗೂ ಆAೋz-
ಆAೋz
H,ೕ Yೆ.ಎಂ
1H,ೕ Yೆ ಎಂ.ವೃಷ=ೇಂದ,ಯ
ಎಂ ವೃಷ=ೇಂದ,ಯ ರವರು ಅಕ,ಮ Iಾಭ 5ಾF ೊಂFದುD, ಇದ ಂದ ಸ ಾ ರದ =ೊಕmಸ ೆm
ರೂ 650,56,065/-ರಷುC
ರಷುC ಆ• ಕ ನಷCವನು0ಂಟು 5ಾFರುವhದು ಾ€aಾJರುತO ೆ.ೆ

ಆದD ಂದ ೕಲmಂಡ ಆAೋz-2 H,ೕ.Nೈ. H,ೕ3Nಾಸ Aಾ{ರವರ ರುದ" •ಾರGೕಯ ದಂಡ
ಸಂ‚aೆ ಕಲಂ 379, 468, 471 gÉ/ 120 ಐz!, Yೊaೆ ೆ ಕಲಂ 21, 23, 4(1) 4(1J) ಎಂಎಂFಆW
ಆ C -1957 ರ ಅFಯ)* H...ಾಹ ಅಪAಾಧ NೆಸJರುaಾOAೆಂದು ೋ@ಾAೋಪBೆ.

ಎ-3 || H,ೕ H,ೕ3Nಾಸ ZನರL ]ೆ,ೕFಂ^ ಕಂಪ3 ( || ಎ ಎ ಎಂ !)
! ೆCೕಷ` ರ ೆO,
7ೊಸ ೇ]ೆ.
ೇ]ೆ ಬwಾx yIೆ*. (ಎ
ಎ-2 ಆAೋz H,ೕ NೈH,ೕ3Nಾಸ Aಾ{ ರವ ಂದ ಪ,G3:ಸಲuಡುತO ೆ)
ೆ

|| H,ೕ H,ೕ3Nಾಸ ZನರL ]ೆ,ೕFಂ^ ಕಂಪ3ಯು ಓಂದು ಾಲು ಾ ೆ ಸಂ ೆV;ಾJದುD,
ಇದರ)* ಪ,ಕರಣದ ಆAೋz-2
ಆAೋz H,ೕ Nೈ H,ೕ3Nಾಸ Aಾ{ ರವರು ಾಲು ಾರAಾJದುD, ಈ ಸಂ ೆVಯ
ಾಲು ಾರರು ಆAೋz-1
ಆAೋz ॥ Yೆ.ಎಂ
Yೆ ಎಂ.ವೃಷ=ೇಂದ,ಯ
ಎಂ ವೃಷ=ೇಂದ,ಯ ರವರ Yೊaೆ ೇ ಒಳಸಂಚು 5ಾF ಅಕ,ಮ
Iಾಭ 5ಾF ೊಳTxವ ಉ ೆDೕಶ ಂದ 2009-10%ೇ
%ೇ ಾ)ನ)* ಗ ಗುGO ೆ ಸಂ.ೆ :2173 ೆ ಸಂಬಂ:!ದ
ಪ, ೇಶ ಂದ 7ಾಗೂ ಅದ ೆm 7ೊಂ ೊಂFರುವ ಪ, ೇಶಗRಂದಲೂ ಸಂಬಂಧಪಟC ಇIಾ.ೆXಂದ
15

;ಾವh ೇ ಪರNಾ3 ೆಯನು0 ಪ9ೆಯ ೇ ಅನ:ಕೃತNಾJ ಕಳxತನ ಂದ ಗ ಾ ೆ 5ಾF ಖ ೕ
5ಾFದ 7ಾ ೆ ಂ ಸಲು ಇ`Nಾ•
ಇ`Nಾ• ಗಳನು0 ಇತAೆ ಆAೋzಗwೆ? ಂ ೆ ೇ ಸೃlC! ೊಂಡು
66,264 ಎಂ.
ಎಂ ಕ ಣದ ಅ ರನು0 7ೊರ ೇಶ ೆm ರ}O 5ಾFರುವhದು ತ3.ಾ ಾಲದ)* ದೃಡಪ CರುತO ೆ.ೆ
ಇದ ಂದ ಈ ಸಂ ೆVಯ ಾಲು ಾರ ೆ ಅನ:ಕೃತ Iಾಭ ಉಂ]ಾJದುD, ಸ ಾ ರದ =ೊಕmಸ ೆm ರೂ
ರಷುC ಆ• ಕ ನಷCವನು0ಂಟು 5ಾFರುವhದು ಾ€aಾJರುತO ೆ.ೆ
6,50,56,065/-ರಷುC

ಆದD ಂದ ೕಲmಂಡ ಆAೋz-3 ॥ H,ೕ H,ೕ3Nಾಸ ZನರL ]ೆ,ೕFಂ^ ಕಂಪ3ಯು
•ಾರGೕಯ ದಂಡ ಸಂ‚aೆ ಕಲಂ 379, 468, 471 gÉ/ 120 ಐz!, Yೊaೆ ೆ ಕಲಂ 21, 23, 4(1)
4(1J) ಎಂಎಂFಆW ಆ C-1957 ರ ಅFಯ)* H...ಾಹ ಅಪAಾಧ NೆಸJರುತO ೆ ಎಂದು
ೋ@ಾAೋಪBೆ."

The concerned Court takes cognizance of the offence and issues

summons. The order of taking cognizance is as follows:

"Date: 03-02-2022 Cr.No.23/2015

ORDER

The Authorized Officer under section 22 of Mines and Minerals (Development and Regulation) Act (in short the M.M.D.R. Act) and the Dy. S.P., Special Investigation Team, (in short SIT) Karnataka Lokayuktha, Bengaluru has filed the complaint under Section 200 of the Cr.P.C. against the accused No. 1 to 6 for the offences punishable under sections 21 read with section 4(1) and 4(1-A) of M.M.D.R. Act, 1957.

2. The Dy. S.P./the Investigation Officer, Karnataka Lokayuktha, SIT, Bengaluru has simultaneously filed the separate charge sheet against the accused No.1 to 6 for the offences punishable under section 109, 379, 409, 468, 471, 120-B of IPC and section 21 and 23 read with section 4(1) and 4(1-A) of M.M.D.R. Act, 1957.

3. As per the prosecution papers, Sri. Koushalendra Kumar, the Superintendent of Police, Special Investigation Team, Karnataka Lokayuktha Bengaluru suo-moto has registered the case in Crime No.23/2015 on 07-09-2015 against G. Janardana Reddy and 9 others for the offences punishable 16 under sections 379, 409, 420, 447, 468, 471 read with section 120-B of IPC and Section 13(1)(d) read with section 13(2) of The Prevention of Corruption Act, 1988 and section 21 and 23 read with section 4(1) and 4(1-A) of MMDR Act, 1957.

4. As per the contents of the first information statement it is alleged that the police have received source information regarding large scale illegal mining, transportation and trading of iron ore. As per the complaint averments, and the charge sheet accused No.3 M/s Sri Srinivas Mineral Trading Company was represented by accused No.2 at the time of registering the FIR. Accused No.1 and 2 are the partners of accused No.3 firm. They alleged have obtained mining license in ML.No.2173 and during the year 2009-2010 they have done illegal mining in collusion and criminal conspiracy with other accused No.4 to 6, committed theft of iron ore and exported 66,264 metric tones without obtaining the valid permit from the department of Mines and Geology and thereby caused loss of Rs.31,23,42,500/- royalty to the State.

5. As per the charge sheet and complaint allegations accused No.4 is the owner of Gururajendra Minerals and Trading Company, in criminal conspiracy and abetment with the accused No.2, he has created 2 false invoices by showing sold 50003 metric tones of iron ore to accused No.2 and assisted him to transport and export iron ore and caused loss of Rs.2,60,01,570/- to the State. Accused No.5 is shown as proprietor of M/s Hanuman Traders and in 2010 he has created false document by showing he has sold 6000 metric tones of iron ore and thereby assisted accused No. 2 and 2 to transport 6,000/- MT iron ore without valid permit and caused loss to the State to the extent of Rs.47,25,000/-.

6. Accused No.6 is shown as the owner of M/s Neelakanta Minerals and he in criminal conspiracy and abetment with accused No.1 to 3 alleged to have issued invoice No.8 for 10000 MT of iron ore and thereby assisted accused No. 1 to 3 to transport and export iron ore without payment of the royalty of Rs.78,75,000/- and thereby caused loss to the State exchequer.

7. As per the judgment of the Hon'ble High court of Karnataka, Bengaluru dated 13-07-2016, in Crl. Pet.4333/16 c/w Crl Rev. Pet. 802/16 in Prakash vs The State held that this court being the special court is empowered to take cognizance of the offences investigated by the Special Investigation Team, Karnataka lokayuktha, Bengaluru.

8. The investigating officer in the final report has stated that the investigation is still in progress against the remaining suspected accused and hence sought the leave of the court to submit the additional charge sheet under Section 173(8) of Cr.P.C. against them.

9. Perused the FIR, Complaint, Search mahazars, statement of witnesses recorded during investigation and the other documents submitted along with the complaint and the charge sheet. These documents prima-facie disclose the commission of the alleged offence by the accused No 1 to 6. At this stage there are sufficient materials to proceed against the accused and take cognizance of the offence against them. Accordingly, I proceed to pass the following:

ORDER Cognizance of the offence is taken against the accused No. 1 to 6 for the offences punishable under sections 109, 379, 409, 468, 471, read With section 120- B of IPC on the basis of the final report filed under Sec.173(2) of the Cr.P.C Cognizance of the offence is taken against the accused No. 1 to 6 for the offences punishable under sections 21 and 23 read with section 4(1) and 4(1-A) of M.M.D.R. Act, 1957on the basis of the complaint filed by the Authorized Officer.

Register the case as Special C.C. in Reg. No. III.

Issue summons to accused No. 1 to 6, returnable by 15-3-22 Sd/- 03-2-2022 18 (Lakshminarayana Bhat.K) XXIII Additional City Civil and Sessions Judge Special Judge, Bengaluru Urban District, Bengaluru."

(Emphasis added at each instance) It is this that is challenged in the case at hand. Before entering upon the grounds of challenge, I deem it appropriate to notice the provision under which the petitioner and other accused are charged.

Section 379 is the primary offence. It deals with theft. It reads as follows:

"379. Punishment for theft.--Whoever commits theft shall be punished with imprisonment of either description for a term which may extend to three years, or with fine, or with both."

For an offence to become punishable under Section 379 of the IPC, the ingredients of Section 378 are to be present. Section 378 reads as follows:

"378. Theft.--Whoever, intending to take dishonestly any movable property out of the possession of any person without that person's consent, moves that property in order to such taking, is said to commit theft.

Explanation 1.--A thing so long as it is attached to the earth, not being movable property, is not the subject of theft; but it becomes capable of being the subject of theft as soon as it is severed from the earth.

Explanation 2.--A moving effected by the same act which effects the severance may be a theft.

Explanation 3.--A person is said to cause a thing to move by removing an obstacle which prevented it from moving or by separating it from any other thing, as well as by actually moving it.

Explanation 4.--A person, who by any means causes an animal to move, is said to move that animal, and to move everything which, in consequence of the motion so caused, is moved by that animal.

Explanation 5.--The consent mentioned in the definition may be express or implied, and may be given either by the person in possession, or by any person having for that purpose authority either express or implied.

Illustrations

(a) A cuts down a tree on Z's ground, with the intention of dishonestly taking the tree out of Z's possession without Z's consent. Here, as soon as A has severed the tree in order to such taking, he has committed theft.

(b) A puts a bait for dogs in his pocket, and thus induces Z's dog to follow it. Here, if A's intention be dishonestly to take the dog out of Z's possession without Z's consent, A has committed theft as soon as Z's dog has begun to follow A.

(c) A meets a bullock carrying a box of treasure. He drives the bullock in a certain direction, in order that he may dishonestly take the treasure. As soon as the bullock begins to move, A has committed theft of the treasure.

(d) A being Z's servant, and entrusted by Z with the care of Z's plate, dishonestly runs away with the plate, without Z's consent. A has committed theft.

(e) Z, going on a journey, entrusts his plate to A, the keeper of a warehouse, till Z shall return. A carries the plate to a goldsmith and sells it. Here the plate was not in Z's possession. It could not therefore be taken out of Z's 20 possession, and A has not committed theft, though he may have committed criminal breach of trust.

(f) A finds a ring belonging to Z on a table in the house which Z occupies. Here the ring is in Z's possession, and if A dishonestly removes it, A commits theft.

(g) A finds a ring lying on the high road, not in the possession of any person. A, by taking it, commits no theft, though he may commit criminal misappropriation of property.

(h) A sees a ring belonging to Z lying on a table in Z's house. Not venturing to misappropriate the ring immediately for fear of search and detection, A hides the ring in a place where it is highly improbable that it will ever be found by Z, with the intention of taking the ring from the hiding place and selling it when the loss is forgotten. Here A, at the time of first moving the ring, commits theft.

(i) A delivers his watch to Z, a jeweller, to be regulated. Z carries it to his shop. A, not owing to the jeweller any debt for which the jeweller might lawfully detain the watch as a security, enters the shop openly, takes his watch by force out of Z's hand, and carries it away. Here A, though he may have committed criminal trespass and assault, has not committed theft, inasmuch as what he did was not done dishonestly.

(j) If A owes money to Z for repairing the watch, and if Z retains the watch lawfully as a security for the debt, and A takes the watch out of Z's possession, with the intention of depriving Z of the property as a security for his debt, he commits theft, inasmuch as he takes it dishonestly.

(k) Again, if A, having pawned his watch to Z, takes it out of Z's possession without Z's consent, not having paid what he borrowed on the watch, he commits theft, though the watch is his own property inasmuch as he takes it dishonestly.

(l) A takes an article belonging to Z out of Z's possession, without Z's consent, with the intention of keeping it until he obtains money from Z as a reward for its restoration.

Here A takes dishonestly; A has therefore committed theft.

(m) A, being on friendly terms with Z, goes into Z's library in Z's absence, and takes away a book without Z's express consent for the purpose merely of reading it, and with the intention of returning it. Here, it is probable that A may have conceived that he had Z's implied consent to use Z's book. If this was A's impression, A has not committed theft.

(n) A, asks charity from Z's wife. She gives A money, food and clothes, which A knows to belong to Z her husband. Here it is probable that A may conceive that Z's wife is authorised to give away alms. If this was A's impression, A has not committed theft.

(o) A is the paramour of Z's wife. She gives a valuable property, which A knows to belong to her husband Z, and to be such property as she has no authority from Z to give. If A takes the property dishonestly, he commits theft.

(p) A, in good faith, believing property belonging to Z to be A's own property, takes that property out of B's possession. Here, as A does not take dishonestly, he does not commit theft."

The offences invoked under the Act and the offence of theft punishable under Section 379 of the IPC have borne consideration by the Apex Court in the case of STATE (NCT OF DELHI) v.

SANJAY1, wherein in an identical circumstance concerning the offence of sand mining, the Apex Court has held as follows:

".... .... ....

71. However, there may be a situation where a person without any lease or licence or any authority enters into river and extracts sand, gravel and other 1 (2014) 9 SCC 772 22 minerals and remove or transport those minerals in a clandestine manner with an intent to remove dishonestly those minerals from the possession of the State, is liable to be punished for committing such offence under Sections 378 and 379 of the Penal Code.

72. From a close reading of the provisions of the MMDR Act and the offence defined under Section 378 IPC, it is manifest that the ingredients constituting the offence are different. The contravention of terms and conditions of mining lease or doing mining activity in violation of Section 4 of the Act is an offence punishable under Section 21 of the MMDR Act, whereas dishonestly removing sand, gravel and other minerals from the river, which is the property of the State, out of the State's possession without the consent, constitute an offence of theft. Hence, merely because initiation of proceeding for commission of an offence under the MMDR Act on the basis of complaint cannot and shall not debar the police from taking action against persons for committing theft of sand and minerals in the manner mentioned above by exercising power under the Code of Criminal Procedure and submit a report before the Magistrate for taking cognizance against such persons. In other words, in a case where there is a theft of sand and gravel from the government land, the police can register a case, investigate the same and submit a final report under Section 173 CrPC before a Magistrate having jurisdiction for the purpose of taking cognizance as provided in Section 190(1)(d) of the Code of Criminal Procedure.

73. After giving our thoughtful consideration in the matter, in the light of the relevant provisions of the Act vis-à-vis the Code of Criminal Procedure and the Penal Code, we are of the definite opinion that the ingredients constituting the offence under the MMDR Act and the ingredients of dishonestly removing sand and gravel from the riverbeds without consent, which is the property of the State, is a distinct offence under IPC. Hence, for the commission of offence under Section 378 IPC, on receipt of the police report, the Magistrate having jurisdiction can take cognizance of the said offence without awaiting the receipt of complaint that may be filed by the authorised officer for taking cognizance in respect of 23 violation of various provisions of the MMDR Act. Consequently, the contrary view taken by the different High Courts cannot be sustained in law and, therefore, overruled. Consequently, these criminal appeals are disposed of with a direction to the Magistrates concerned to proceed accordingly."

Later, the Apex Court in KANWAR PAL SINGH v. STATE OF UTTAR PRADESH2, has held as follows:

".... .... ....

10. Elucidating on the provisions of Section 4 read with Sections 21 and 22 of the MMDR Act, 1957 and the offence under Section 379 IPC, it was observed in Sanjay [State (NCT of Delhi) v. Sanjay, (2014) 9 SCC 772 : (2014) 5 SCC (Cri) 437] :

(SCC pp. 811-12, paras 69-72) "69. Considering the principles of interpretation and the wordings used in Section 22, in our considered opinion, the provision is not a complete and absolute bar for taking action by the police for illegal and dishonestly committing theft of minerals including sand from the riverbed. The Court shall take judicial notice of the fact that over the years rivers in India have been affected by the alarming rate of unrestricted sand mining which is damaging the ecosystem of the rivers and safety of bridges. It also weakens riverbeds, fish breeding and destroys the natural habitat of many organisms. If these illegal activities are not stopped by the State and the police authorities of the State, it will cause serious repercussions as mentioned hereinabove. It will not only change the river hydrology but also will deplete the groundwater levels.

70. There cannot be any dispute with regard to restrictions imposed under the MMDR Act and remedy provided therein. In any case, where there is a mining activity by any person in contravention of the provisions of Section 4 and other sections of the Act, the officer empowered and authorised under the Act shall exercise all the powers including making a complaint before the 2 (2020) 14 SCC 331 24 jurisdictional Magistrate. It is also not in dispute that the Magistrate shall in such cases take cognizance on the basis of the complaint filed before it by a duly authorised officer. In case of breach and violation of Section 4 and other provisions of the Act, the police officer cannot insist the Magistrate for taking cognizance under the Act on the basis of the record submitted by the police alleging contravention of the said Act. In other words, the prohibition contained in Section 22 of the Act against prosecution of a person except on a complaint made by the officer is attracted only when such person is sought to be prosecuted for contravention of Section 4 of the Act and not for any act or omission which constitutes an offence under the Penal Code.

71. However, there may be a situation where a person without any lease or licence or any authority enters into river and extracts sand, gravel and other minerals and remove or transport those minerals in a clandestine manner with an intent to remove dishonestly those minerals from the possession of the State, is liable to be punished for committing such offence under Sections 378 and 379 of the Penal Code.

72. From a close reading of the provisions of the MMDR Act and the offence defined under Section 378 IPC, it is manifest that the ingredients constituting the offence are different. The contravention of terms and conditions of mining lease or doing mining activity in violation of Section 4 of the Act is an offence punishable under Section 21 of the MMDR Act, whereas dishonestly removing sand, gravel and other minerals from the river, which is the property of the State, out of the State's possession without the consent, constitute an offence of theft. Hence, merely because initiation of proceeding for commission of an offence under the MMDR Act on the basis of complaint cannot and shall not debar the police from taking action against persons for committing theft of sand and minerals in the manner mentioned above by exercising power under the Code of Criminal Procedure and submit a report before the Magistrate for taking cognizance against such persons. In other words, in a case where there is a theft of sand and gravel from the government land, the police can register a case, investigate the same and submit a final 25 report under Section 173 CrPC before a Magistrate having jurisdiction for the purpose of taking cognizance as provided in Section 190(1)(d) CrPC."

(emphasis supplied) ... ... ...

12. We would also reject the contention raised by the appellant in the written submissions that the alleged theft of sand is not punishable under Section 379 read with Section 378 IPC as sand is an immovable property as per Section 3(26) of the General Clauses Act. In the present case, sand had been excavated and was thereupon no longer an immovable property. The sand on being excavated would lose its attachment to the earth, ergo, it is a movable property or goods capable of being stolen. (See Explanation 1 to Section 378 IPC and Sanjay [State (NCT of Delhi) v. Sanjay, (2014) 9 SCC 772: (2014) 5 SCC (Cri) 437] as quoted above.)".

If the law laid down by the Apex Court in the afore-quoted judgments is pitted against the facts obtaining in the case at hand, what would unmistakably emerge is, extracting iron ore beyond the permissible limit and without the consent of the state would become a movable property capable of being stolen in terms of the first and second explanation to Section 378 of the IPC.

8. The other offence is under Section 409 of the IPC, criminal breach of trust by public servant, banker, merchant or agent. It reads as follows:

"409. Criminal breach of trust by public servant, or by banker, merchant or agent.--Whoever, being in any manner entrusted with property, or with any dominion over property in his capacity of a public servant or in the way of his business as a banker, merchant, factor, broker, attorney or agent, commits criminal breach of trust in respect of that property, shall be punished with imprisonment for life, or with imprisonment of either description for a term which may extend to ten years, and shall also be liable to fine."

Interpretation of Section 409 of the IPC also need not detain this Court for long or delve deep into the matter. The Apex Court in R. VENKATKRISHNAN v. CENTRAL BUREAU OF INVESTIGATION3 has held as follows:

                                  "....        ....    ....

        Criminal breach of trust

140. The next charge we have to deal with is one arising under Section 409 IPC. For the offence of criminal breach of trust by a public servant the punishment is provided under Section 409 IPC.

141. We must also in this respect have regard to the provision of Section 405 which defines criminal breach of trust:

"405. Criminal breach of trust.--Whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied, which he has made touching the discharge of such trust, or wilfully suffers any other person so to do, commits 'criminal breach of trust'."

(2009) 11 SCC 737 27

142. Punishment for criminal breach of trust is provided in Section 406. Punishment for an aggravated form of criminal breach of trust is provided in Sections 407 to 409.

143. The terms of Section 405 are very wide. They apply to one who is in any manner entrusted with property or dominion over property. The section does not require that the trust should be in furtherance of any lawful object. It merely provides, inter alia, that if such a person dishonestly misappropriates or converts to his own use the property entrusted to him, he commits criminal breach of trust. This section requires:

(1) Entrusting any person with property or with dominion over property.

(2) That person entrusted (a) dishonestly misappropriates or converts to his own use that property; or (b) dishonestly uses or disposes of that property or wilfully suffers any other person so to do in violation:

(i) of any direction of law prescribing the mode in which such trust is to be discharged, or

(ii) of any legal contract made touching the discharge of such trust.

144. In Onkar Nath Mishra v. State (NCT of Delhi) [(2008) 2 SCC 561 : (2008) 1 SCC (Cri) 507] this Court noted that in the commission of the offence of criminal breach of trust, two distinct parts are involved. The first consists of the creation of an obligation in relation to the property over which dominion or control is acquired by the accused. The second is a misappropriation or dealing with the property dishonestly and contrary to the terms of the obligation created.

145. In Jaikrishnadas Manohardas Desai v. State of Bombay [AIR 1960 SC 889] , this Court observed: (AIR p. 891, para 4) 28 "4. ... to establish a charge of criminal breach of trust, the prosecution is not obliged to prove the precise mode of conversion, misappropriation or misapplication by the accused of the property entrusted to him or over which he has dominion. The principal ingredient of the offence being dishonest misappropriation or conversion which may not ordinarily be a matter of direct proof, entrustment of property and failure in breach of an obligation to account for the property entrusted, if proved, may in the light of other circumstances, justifiably lead to an inference of dishonest misappropriation or conversion. Conviction of a person for the offence of criminal breach of trust may not, in all cases, be founded merely on his failure to account for the property entrusted to him, or over which he has dominion, even when a duty to account is imposed upon him, but where he is unable to account or renders an explanation for his failure to account which is untrue, an inference of misappropriation with dishonest intent may readily be made."

146. However, Sections 407 to 409 make special provisions for various cases in which property is entrusted to the enumerated categories of persons who commit the offence. Criminal breach of trust by a public servant is dealt with under Section 409:

"409. Criminal breach of trust by public servant, or by banker, merchant or agent.-- Whoever, being in any manner entrusted with property or with any dominion over property in his capacity of a public servant or in the way of his business as a banker, merchant, factor, broker, attorney or agent, commits criminal breach of trust in respect of that property, shall be punished with imprisonment for life, or with imprisonment of either description for a term which may extend to ten years, and shall also be liable to fine."

This section classes together public servants, bankers, merchants, factors, brokers, attorneys and agents. The duties of such persons are of a highly confidential character, involving great powers of control, over the property entrusted to them and a breach of trust by such persons may often induce serious public and private calamity. High morality is expected of these persons. They are to discharge their duties honestly. The following are the essential ingredients of the offence under this section:

(1) The accused must be a public servant;

(2) He must have been entrusted, in such capacity with the property;

(3) He must have committed breach of trust in respect of such property.

147. In Raghunath Anant Govilkar v. State of Maharashtra [(2008) 11 SCC 289 : (2009) 1 SCC (Cri) 130 :

(2008) 2 Scale 303] the Court noted that Section 406 which provides the punishment for criminal breach of trust simpliciter and Section 409 IPC are cognate offences in which the common component is criminal breach of trust. When an offence punishable under Section 406 is committed by a public servant (or holding any one other of the positions listed in the section) the offence would escalate to Section 409 of the Penal Code.

In Supdt. and Remembrancer of Legal Affairs v. S.K. Roy [(1974) 4 SCC 230: 1974 SCC (Cri) 399] , this Court held:

(SCC p. 235, para 12) "12. To constitute an offence under Section 409 IPC, it is not required that misappropriation must necessarily take place after the creation of a legally correct entrustment or dominion over property. The entrustment may arise in 'any manner whatsoever'. That manner may or may not involve fraudulent conduct of the accused.

Section 409 IPC, covers dishonest misappropriation in both types of cases; that is to say, those where the receipt of property is itself fraudulent or improper and those where the public servant 30 misappropriates what may have been quite properly and innocently received. All that is required is what may be described as 'entrustment' or acquisition of dominion over property in the capacity of a public servant who, as a result of it, becomes charged with a duty to act in a particular way, or, at least honestly."

148. In ChelloorMankkal Narayan Ittiravi Nambudiri v. State of Travancore-Cochin [(1952) 2 SCC 392 :

AIR 1953 SC 478] , this Court held: (AIR p. 484, para 21) "21. ... to constitute an offence of criminal breach of trust it is essential that the prosecution must prove first of all that the accused was entrusted with some property or with any dominion or power over it. It has to be established further that in respect of the property so entrusted, there was dishonest misappropriation or dishonest conversion or dishonest use or disposal in violation of a direction of law or legal contract, by the accused himself or by someone else which he willingly suffered to do."

149. In Ram Narayan Popli [(2003) 3 SCC 641 : 2003 SCC (Cri) 869] this Court stated the law, thus: (SCC p. 786, para 361) "361. To constitute an offence of criminal breach of trust, there must be an entrustment, there must be misappropriation or conversion to one's own use, or use in violation of a legal direction or of any legal contract; and the misappropriation or conversion or disposal must be with a dishonest intention. When a person allows others to misappropriate the money entrusted to him, that amounts to a criminal breach of trust as defined by Section 405. The section is relatable to property in a positive part and a negative part. The positive part deals with criminal misappropriation or conversion of the 31 property and the negative part consists of dishonestly using or disposing of the property in violation of any direction and of law or any contract touching the discharge of trust."

Whether this would become applicable to the petitioner is necessary to be considered.

9. The petitioner did have a mining lease. It is his case that he has surrendered the lease for a temporary period. It is the case of the prosecution that by then illegal ore had been extracted by the agreement holder or M/s Madhushree Enterprises and accused No.3, which took over the mines. It is, therefore, Section 120B of the IPC has come in. Section 120B of the IPC is interpreted by the Apex Court in GURDEEP SINGH v. STATE OF PUNJAB4 as under:

".... .... ....

17. As regards the second limb of the appellant's contention, it is well established that the offence of criminal conspiracy under section 120B IPC, by its very nature, is seldom capable of being proved by direct evidence. Being a clandestine agreement between two or more persons to commit an unlawful act, or a lawful act by unlawful means, conspiracy is typically established through circumstantial evidence, patterns of conduct, and the cumulative interferences drawn from the interactions of the accused persons.

2025 SCC OnLine SC 1669 32 17.1. In State (NCT of Delhi) v. Navjot Sandhu6, this Court underscored that conspiracy is inherently covert and rarely leaves behind direct traces. Its existence can be inferred from the surrounding facts and circumstances, the conduct of the accused before, during, and after the occurrence, and the manner in which the crime unfolds. It was further held that every conspirator need not commit an overt act to be held liable, the agreement itself constitutes the offence. What is required is a concert of purpose and unity of design. It was also emphasized that conspiracy is an independent offence and may be punishable even if the substantive offence contemplated by the conspirators does not ultimately materialize. The following paragraphs are pertinent in this regard:

"97. Mostly, conspiracies are proved by circumstantial evidence, as the conspiracy is seldom an open affair. Usually, both the existence of the conspiracy and its objects have to be inferred from the circumstances and the conduct of the accused (per Wadhwa, J. in Nalini case, [(1999) 5 SCC 253 : 1999 SCC (Cri) 691] at p. 516). The well- known rule governing circumstantial evidence is that each and every incriminating circumstance must be clearly established by reliable evidence and "the circumstances so proved must form a chain of events from which the only irresistible conclusion about the guilt of the accused can be safely drawn and no other hypothesis against the guilt is possible" (Tanviben Pankajkumar case [Tanviben Pankajkumar Divetia v. State of Gujarat,, (1997) 7 SCC 156 : 1997 SCC (Cri) 1004], SCC p. 185, para 45). G.N. Ray, J. in Tanviben Pankajkumar [Tanviben Pankajkumar Divetia v. State of Gujarat,, (1997) 7 SCC 156 : 1997 SCC (Cri) 1004] observed that this Court should not allow suspicion to take the place of legal proof."

17.2. Similarly, in Ajay Aggarwal v. Union of India7, it was reiterated that conspiracy is a continuing offence, which begins with the formation of the unlawful agreement and continues until the common objective is either achieved or abandoned. The court clarified that the crime is complete with the agreement itself and that no overt act is necessary to sustain a conviction under 33 Section 120B IPC. The relevant paragraphs of the said decision are usefully extracted below:

"10. In Mohammad Usman Mohammad Hussain Maniyar v. State of Maharashtra, [(1981) 2 SCC 443 : 1981 SCC (Cri) 477 : (1981) 3 SCR 68] it was held that for an offence under Section 120-BIPC, the prosecution need not necessarily prove that the conspirators expressly agreed to do or cause to be done the illegal act, the agreement may be proved by necessary implication. In Noor Mohammad Mohd. Yusuf Momin v. State of Maharashtra, [(1970) 1 SCC 696 : 1970 SCC (Cri) 274 : (1971) 1 SCR 119] it was held that Section 120-BIPC makes the criminal conspiracy as a substantive offence which offence postulates an agreement between two or more persons to do or cause to be done an act by illegal means. If the offence itself is to commit an offence, no further steps are needed to be proved to carry the agreement into effect. In R.K. Dalmia v. Delhi Administration, [(1963) 1 SCR 253 : AIR 1962 SC 1821 : (1962) 2 Cri LJ 805] it was further held that it is not necessary that each member of a conspiracy must know all the details of the conspiracy. In Shivanarayan Laxminarayan Joshi v. State of Maharashtra [(1980) 2 SCC 465 : 1980 SCC (Cri) 493] this Court emphasized that a conspiracy is always hatched in secrecy and it is impossible to adduce direct evidence of the same. The offence can be only proved largely from the inferences drawn from acts or illegal omission committed by the conspirators in pursuance of a common design."

17.3. In Sudhir Shantilal Mehta v. CBI8, the Court again affirmed that due to the covert nature of conspiracies, courts must necessarily look to the overall circumstances, the acts of the accused, and the coherence of their conduct to infer a conspiracy. The presence of a common intention and the coordinated acts of multiple persons can give rise to a legitimate inference of an unlawful agreement. The relevant paragraphs read as under:

"Criminal conspiracy 34

113. Criminal conspiracy is an independent offence. It is punishable independent of other offences; its ingredients being:

(i) an agreement between two or more persons.

(ii) the agreement must relate to doing or causing to be done either

(a) an illegal act;

(b) an act which is not illegal in itself but is done by illegal means.

It is now, however, well settled that a conspiracy ordinarily is hatched in secrecy. The court for the purpose of arriving at a finding as to whether the said offence has been committed or not may take into consideration the circumstantial evidence. While however doing so, it must bear in mind that meeting of the minds is essential; mere knowledge or discussion would not be. As the question has been dealt with in some detail in Criminal Appeal No. 76 of 2004 (R. Venkatakrishnan v. CBI, [(2009) 11 SCC 737]), it is not necessary for us to dilate thereupon any further."

....

116. In K.R. Purushothaman v. State of Kerala, [(2005) 12 SCC 631 : (2006) 1 SCC (Cri) 686] this Court held: (SCC pp. 636-38, paras 11 & 13) "11. Section 120-A IPC defines 'criminal conspiracy'. According to this section when two or more persons agree to do, or cause to be done (i) an illegal act, or (ii) an act which is not illegal by illegal means, such an agreement is designated a criminal conspiracy. In Major E.G. Barsay v. State of Bombay, [AIR 1961 SC 1762 : (1962) 2 SCR 195] Subba Rao, J., speaking for the Court has said: (AIR p. 1778, para 31) '31. ... The gist of the offence is an agreement to break the law. The parties to such an agreement will be guilty of criminal conspiracy, though the illegal act agreed to be done has not been done. So too, it is not an ingredient of the offence that all the parties should agree to do a single illegal act. It may comprise the commission of a number of acts.' 35 ***

13. To constitute a conspiracy, meeting of minds of two or more persons for doing an illegal act or an act by illegal means is the first and primary condition and it is not necessary that all the conspirators must know each and every detail of the conspiracy. Neither it is necessary that every one of the conspirators takes active part in the commission of each and every conspiratorial acts. The agreement amongst the conspirators can be inferred by necessary implication. In most of the cases, the conspiracies are proved by the circumstantial evidence, as the conspiracy is seldom an open affair. The existence of conspiracy and its objects are usually deduced from the circumstances of the case and the conduct of the accused involved in the conspiracy. While appreciating the evidence of the conspiracy, it is incumbent on the court to keep in mind the well-known rule governing circumstantial evidence viz. each and every incriminating circumstance must be clearly established by reliable evidence and the circumstances proved must form a chain of events from which the only irresistible conclusion about the guilt of the accused can be safely drawn, and no other hypothesis against the guilt is possible. The criminal conspiracy is an independent offence in the Penal Code. The unlawful agreement is sine qua non for constituting offence under the Penal Code and not an accomplishment. Conspiracy consists of the scheme or adjustment between two or more persons which may be express or implied or partly express and partly implied. Mere knowledge, even discussion, of the plan would not per se constitute conspiracy. The offence of conspiracy shall continue till the termination of agreement."

(See also P.K. Narayanan v. State of Kerala, [(1995) 1 SCC 142 : 1995 SCC (Cri) 215].)"

Thus, it is crystal clear that the offence of criminal conspiracy need not be proved by direct evidence, nor is it necessary that all conspirators participate in every stage of the commission of the offence. What is material is the existence of a prior agreement - express or implied - to commit an unlawful act, or a lawful act by unlawful means. Once such agreement is established, even by way of inference from 36 circumstantial evidence, the legal consequences under Section 120B IPC follow.

17.4. In the present case, the prosecution has convincingly established the existence of a prior concert of action between the appellant and the assailants. The use of a private vehicle associated with the appellant, the involvement of unidentified persons, the stop at a scheduled location under a false pretext, and the appellant's conspicuous inaction during the violent assault - despite being in a position of official authority - all form a continuous chain of incriminating circumstances that point toward his complicity in the conspiracy. His deliberate inaction, lack of any injuries, and subsequent disappearance from the scene further reinforce the inference of his active role. The appellant's conduct was not peripheral but integral to the execution of the plan to facilitate the escape of the undertrial Kuldeep Singh. His behaviour before, during, and after the incident establishes his culpability under section 120B IPC. Accordingly, his conviction for the substantive offences with the aid of Section 120B IPC is legally sustainable."

The Apex Court holds that for the offence of criminal conspiracy there need not be direct evidence, nor is it necessary that all conspirators participate at every stage of commission of offence.

What is material is existence of prior agreement whether express or implied to commit the act.

10. Whether the petitioner had surrendered the lease and by then the ore had been extracted, are all matters of evidence in which the petitioner will have to come out clean. The prime projection of the petitioner is, delay has vitiated the proceedings as 37 the crime is registered six years after the incident. If there is sufficient explanation for delay, that would not vitiate registration of crime is the law laid down by the Apex Court in SEKARAN v.

STATE OF TAMIL NADU5 wherein it is held as follows:

".... .... ....

14. We start with the FIR, to which exception has been taken by the appellant urging that there has been no satisfactory explanation for its belated registration. It is trite that merely because there is some delay in lodging an FIR, the same by itself and without anything more ought not to weigh in the mind of the courts in all cases as fatal for the prosecution. A realistic and pragmatic approach has to be adopted, keeping in mind the peculiarities of each particular case, to assess whether the unexplained delay in lodging the FIR is an afterthought to give a coloured version of the incident, which is sufficient to corrode the credibility of the prosecution version.

15. In cases where delay occurs, it has to be tested on the anvil of other attending circumstances. If on an overall consideration of all relevant circumstances it appears to the court that the delay in lodging the FIR has been explained, mere delay cannot be sufficient to disbelieve the prosecution case; however, if the delay is not satisfactorily explained and it appears to the court that cause for the delay had been necessitated to frame anyone as an accused, there is no reason as to why the delay should not be considered as fatal forming part of several factors to vitiate the conviction."

(Emphasis supplied at each instance) 5 (2024) 2 SCC 176 38 In the light of the aforesaid judgments of the Apex Court and the facts in the case at hand being shrouded with seriously disputed questions of fact, trial in such a case is a must. It is for the petitioner to come out clean.

11. In the result, the petition is rejected. Interim order of any kind operating, shall stand dissolved.

It is made clear that the observations made in the course of the order are only for the purpose of consideration of the case of the petitioner under Section 482 of the Cr.P.C., and the same shall not bind or influence the proceedings against any other accused pending before any fora.

SD/-

(M.NAGAPRASANNA) JUDGE Bkp/CT:MJ

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