Andhra Pradesh High Court - Amravati
U.K. Mittal, vs The State Of A.P., Through ... on 24 January, 2019
Author: U. Durga Prasad Rao
Bench: U. Durga Prasad Rao
HON'BLE SRI JUSTICE U. DURGA PRASAD RAO
Criminal Petition No.7925 of 2007
ORDER:
In this petition filed under Section 482 of Cr.P.C, the petitioner/A1 supplicates to quash the proceedings against him in C.C.No.13/2003 on the file of Spl. Judge for C.B.I cases, Visakhapatnam registered for the offences under Sections 120-B, 420 of IPC and Section 13(2) r/w.Sec.13(1)(d) of The Prevention of Corruption Act, 1988 ( for short 'PC Act').
2. The prosecution case, succinctly is that, the petitioner/A1 worked as Director (Commercial) in Steel Authority of India Limited (for short, 'SAIL') during October, 1994 and March, 1995. The Steel plants of SAIL produced the sophisticated irons and steel products i.e., plates etc., and exports part of those high quality products to abroad. Most of the steel products including plates are exported through Visakhapatnam Port Trust. After completion of shipment of the plates, the left over material (export surplus/export rejected), will be reclassified confirming to Bureau of Indian Standards before disposal in home sales and the material will be sold through Branch Sales office and Branch Transport and Shipping office after completion of Excise formalities for effecting home sales through its branches. The Central Marketing Organization will fix the ex-stock yard prices from time to time at various locations after due approval of competent authority. During July, 1994, the Branch Sales Office, 2 Visakhapatnam with the approval of highest authorities, floated a tender through bidding backed by refundable EMD for the sale of 5200 metric tonnes plates lying in different lots arrived between January, 1993 and April, 1994 and obtained prices raising between Rs.15,789/- to Rs.17,679/- for different lots by 22 bidders including accused No.4. However, the then Director (Commercial) felt that the rates offered by H1 tenderer were lower by Rs.750/- to Rs.3000/- per metric tonne from the stock yard prices and shelved the proposal and return the refundable security to the tenderer.
b) The further case of prosecution is that during 1994, A-1, A-2 - the then Regional Manager, Transport and Shipping Department, SAIL Visakhapatnam; A-3 - the then Regional Manager, Central Marketing Organization, SAIL, New Delhi; A-4 - General Manager (Marketing) in the Director (Commercial Secretariat), New Delhi and A-5 - Chief (Marketing) Transport and Shipping, Head Quarters, Central Marketing Organization, SAIL, Kolkatta entered into a criminal conspiracy in order to obtain wrongful gain to them and to cause corresponding wrongful loss to SAIL in the disposal of export surplus / rejected plates without reclassification and without free sale notice system. Pursuant to said criminal conspiracy and in violation of existing guidelines dated 08.10.1993 and 20.06.1994, they have given wrong orders vide letter dated 23.11.1994 for sale of about 6000 metric tonnes of unclassified export surplus / rejected plates at Rs.12,000/- per MT to A-4 firm on as is where is basis, which 3 includes defective bent and rusted plates as per A-2 and dispatched the plates as old plates and in that process caused wrongful loss to the SAIL organization to a tune of Rs.98,65,688/-. Hence the charge sheet.
c) The petitioner thus, filed the instant petition to quash the proceedings against him in C.C.No.13 of 2003.
3. Heard Smt.K.Sesharajyam, learned Senior Counsel for the petitioner / A-1 and learned Special Public Prosecutor for CBI Cases.
4. The main plank of argument of learned senior counsel for the petitioner is that the petitioner / A-1 was a public servant within the ambit of Section 19 of PC Act and also under Section 197 Cr.P.C, as such, to prosecute him for the offences alleged in the charge sheet, the prerequisite condition was to obtain sanction order from the competent authority, as otherwise, Court shall not take cognizance against him. In expatiation, learned senior counsel would submit that in respect of offences under Section 120-B and 420 IPC, sanction under Section 197 Cr.P.C and for the offence under Section 13 (2) r/w 13 (1)(d) of PC Act, sanction under Section 19 of the said Act are required. Learned senior counsel would submit that the charge sheet in this case was filed on 20.05.2003, but the petitioner / A-1 was retired from service even prior to it i.e. on 30.11.1997. Since his retirement was earlier to the charge sheet, learned senior counsel would fairly admit that no sanction under Section 19 of PC Act is 4 essential to prosecute him for the offence under Section 13 (2) r/w 13 (1) (d) of PC Act. On this proposition learned senior counsel submitted a decision of the apex Court in State of Punjab Vs. Labh Singh1. She would further submit that in view of the phrase "who is or was" employed in Section 197 Cr.P.C., in spite of petitioner / A-1 retired prior to filing charge sheet, still sanction is required from the competent authority in respect of the offences allegedly committed by him while discharging his official duty. On this aspect, learned senior counsel relied on the decision of the apex Court in State of Punjab Vs. Labh Singh (supra-1) and State of Maharastra Vs. Dr.Budhikota Subbarao2. Therefore, she would emphasize, the investigating agency should invariably procure sanction from the competent authority under Section 197 Cr.P.C to prosecute the petitioner / A-1 for the offences under Section 120-B and 420 IPC. However, no such sanction was obtained and produced at the time of filing the charge sheet but the trial Court erroneously took cognizance of the offences. Therefore, the offences under Section 120-B and 420 IPC in C.C.No.13 of 2003 are liable to be quashed.
5. Per contra, learned Special Public Prosecutor would firstly argue that the petitioner / A-1 worked as Director (Commercial) in Steel Authority of India Limited, New Delhi during the relevant period of offence. The Steel Authority of India Limited (SAIL) is an 1 (2014) 16 Supreme Court Cases 807 2 (1993) 3 Supreme Court Cases 339 5 Indian state-owned steel making company based in New Delhi, India and it is a public sector undertaking, owned and operated by the Government of India. Therefore, it is only a instrumentality of the State and as such, the petitioner / A-1 who worked in the said organization cannot be deemed to be a public servant within the ambit of Section 197 Cr.P.C, as such irrespective of the fact whether he retired prior or subsequent to the filing of charge sheet, no prior sanction under Section 197 Cr.P.C is required and, therefore, the trial Court cannot be found fault for taking cognizance. He placed reliance on the decision of the apex Court in Mohd. Hadi Raja Vs. State of Bihar3 to contend that protection by way of sanction under Section 197 Cr.P.C is not applicable to the officers of Government companies and public sector undertakings.
6. Secondly, he would argue that so far as the offence under Section 13 (2) r/w 13 (1) (d) of PC Act is concerned, sanction was not essential since the petitioner / A-1 was retired from service even prior to the filing of the charge sheet. So far as the offences under Section 120-B and 420 IPC are concerned, he would strenuously argue that having regard to the nature of those offences, the protective umbrella under Section 197 Cr.P.C will not extend to such offences involving moral turpitude. He placed reliance on the decisions of the apex Court in Parkash Singh Badal and Ors. Vs. State of Punjab and 3 AIR 1998 SC 1945 6 Ors.4 and Inspector of Police and Ors. Vs. Battenapatla Venkata Ratnam and Ors.5 Thus, prayed to dismiss the petition.
7. Now, the points for consideration are:
1) Whether the petitioner / A-1 is a public servant within the ambit of Section 197 Cr.P.C and Section 19 of PC Act?
2) If point No.1 is held affirmatively, whether prior sanction is an essential requisite for his prosecution?
8. POINT No.1:
Admittedly, the petitioner / A-1 worked as Director (Commercial), SAIL, New Delhi during the relevant period of offence and was retired on 30.11.1997. Charge sheet in this case was filed on 20.05.2003. Both section 197 Cr.P.C as well as Section 19 of PC Act extended protection to a 'public servant' envisaged in those sections.
For better appreciation of nuances, both the Sections are juxtaposed as follows:
SECTION 197 CR.P.C SECTION 19 OF PC ACT
197. Prosecution of Judges and public 19. Previous sanction necessary for
servants. prosecution.--
(1) When any person who is or was a (1) No court shall take cognizance of an
Judge or Magistrate or a public servant not offence punishable under sections 7, 10,
removable from his office save by or with 11, 13 and 15 alleged to have been
the sanction of the Government is accused committed by a public servant, except with
of any offence alleged to have been the previous sanction,--
committed by him while acting or (a) in the case of a person who is employed
purporting to act in the discharge of his in connection with the affairs of the Union
official duty, no Court shall take and is not removable from his office save
cognizance of such offence except with the by or with the sanction of the Central
previous sanction- Government, of that Government;
(a) in the case of a person who is (b) in the case of a person who is
employed or, as the case may be, was at employed in connection with the affairs of
4
AIR 2007 SC 1274
5
AIR 2015 SC 2403
7
the time of commission of the alleged a State and is not removable from his
offence employed, in connection with the office save by or with the sanction of the
affairs of the Union, of the Central State Government, of that Government;
Government; (c) in the case of any other person, of the
(b) in the case of a person who is authority competent to remove him from
employed or, as the case may be, was at his office.
the time of commission of the alleged (2) Where for any reason whatsoever any
offence employed, in connection with the doubt arises as to whether the previous
affairs of a State, of the State Government: sanction as required under sub-section (1)
Provided that where the alleged offence should be given by the Central
was committed by a person referred to in Government or the State Government or
clause (b) during the period while a any other authority, such sanction shall be
Proclamation issued under clause (1) of given by that Government or authority
article 356 of the Constitution was in force which would have been competent to
in a State, clause (b) will apply as if for the remove the public servant from his office
expression" State Government" occurring at the time when the offence was alleged to
therein, the expression" Central have been committed.
Government" were substituted. (3) Notwithstanding anything contained in
(2) No Court shall take cognizance of the Code of Criminal Procedure, 1973 (2
any offence alleged to have been of 1974),--
committed by any member of the Armed (a) no finding, sentence or order passed by
Forces of the Union while acting or a special Judge shall be reversed or altered
purporting to act in the discharge of his by a court in appeal, confirmation or
official duty, except with the previous revision on the ground of the absence of,
sanction of the Central Government. or any error, omission or irregularity in,
(3) The State Government may, by the sanction required under sub-section (1),
notification, direct that the provisions of unless in the opinion of that court, a failure
sub- section (2) shall apply to such class or of justice has in fact been occasioned
category of the members of the Forces thereby;
charged with the maintenance of public (b) no court shall stay the proceedings
order as may be specified therein, under this Act on the ground of any error,
wherever they may be serving, and omission or irregularity in the sanction
thereupon the provisions of that sub- granted by the authority, unless it is
section will apply as if for the expression" satisfied that such error, omission or
Central Government" occurring therein, irregularity has resulted in a failure of
the expression" State Government" were justice;
substituted. (c) no court shall stay the proceedings
(3A) Notwithstanding anything under this Act on any other ground and no
contained in sub- section (3), no court shall court shall exercise the powers of revision
take cognizance of any offence, alleged to in relation to any interlocutory order
have been committed by any member of passed in any inquiry, trial, appeal or other
the Forces charged with the maintenance proceedings.
of public order in a State while acting or (4) In determining under sub-section (3)
purporting to act in the discharge of his whether the absence of, or any error,
official duty during the period while a omission or irregularity in, such sanction
Proclamation issued under clause (1) of has occasioned or resulted in a failure of
article 356 of the Constitution was in force justice the court shall have regard to the
therein, except with the previous sanction fact whether the objection could and
of the Central Government. should have been raised at any earlier stage
(3B) Notwithstanding anything to the in the proceedings. Explanation.--For the
contrary contained in this Code or any purposes of this section,--
other law, it is hereby declared that any (a) error includes competency of the
sanction accorded by the State Government authority to grant sanction;
or any cognizance taken by a court upon (b) a sanction required for prosecution
such sanction, during the period includes reference to any requirement that
commencing on the 20th day of August, the prosecution shall be at the instance of a
1991 and ending with the date immediately specified authority or with the sanction of
preceding the date on which the Code of a specified person or any requirement of a
Criminal Procedure (Amendment) Act, similar nature.
1991 , receives the assent of the President,
8
with respect to an offence alleged to have
been committed during the period while a
Proclamation issued under clause (1) of
article 356 of the Constitution was in force
in the State, shall be invalid and it shall be
competent for the Central Government in
such matter to accord sanction and for the
court to take cognizance thereon.]
(4) The Central Government or the
State Government, as the case may be, may
determine the person by whom, the manner
in which, and the offence or offences for
which, the prosecution of such Judge,
Magistrate or public servant is to be
conducted, and may specify the Court
before which the trial is to be held.
Hence, the question is whether the petitioner / A-1 was a public servant during the relevant period
9. Section 197 Cr.P.C is concerned, neither the said section nor Cr.P.C has defined the term 'public servant'. However Section 2 (y) of Cr.P.C provides that the words used in the Cr.P.C. but not defined therein, but defined in the Indian Penal Code shall be deemed to have the same meaning attributed to them in the Indian Penal Code. Section 21 of IPC defined 'public servant' and, therefore, the said expression will have the same meaning for the purpose of Section 197 Cr.P.C also.
(b) Clause 12 of Section 21 IPC is germane for us, which reads thus:
(Twelfth) --Every person--
(a) in the service or pay of the Government or remunerated by fees or commission for the performance of any public duty by the Government;
(b) in the service or pay of a local authority, a corporation established by or under a Central, Provincial or State Act or a Government company as defined in section 617 of the Companies Act, 1956 (1 of 1956).9
Since the petitioner worked in the Government company during the relevant period of offence, he can be said to be public servant within the ambit of Section 197 Cr.P.C.
So far as PC Act is concerned, Section 2 (c) (iii) of the said Act lays down that -
"(iii) any person in the service or pay of a corporation established by or under a Central, Provincial or State Act, or an authority or a body owned or controlled or aided by the Government or a Government company as defined in section 617 of the Companies Act, 1956 (1 of 1956);"
The above provision, it must be said, is in pari materia with Clause 12 of Section 21 IPC. In that view, the petitioner can be said to be a public servant within the meaning of Section 19 of PC Act also. Thus, point No.1 is held in favour of petitioner.
10. POINT No.2:
It has been held in point No.1 supra that the petitioner is a public servant for the purpose of both the enactments. Then the question is whether such status is suffice to extend protection to him under the above two enactments.
11. Section 19 of PC Act is concerned, sanction to prosecute a public servant for the offences committed by him in the discharge of his official duty will be required only during such public servant is in service but not after his retirement. It is because, unlike in Section 197 Cr.P.C, there is no phrase 'any person who is or was' preceding the word 'public servant' in Section 19 of PC Act. Therefore, by the 10 time of taking cognizance of offences under PC Act, if the accused was already retired, no sanction under Section 19 is mandatory. It was so held in Labh Singh's case (supra-1).
"In the present case the public servants in question had retired on 13.12.1999 and 30.04.2000. The sanction to prosecute them was rejected subsequent to their retirement i.e. first on 13.09.2000 and later on 24.09.2003. The public servants having retired from service there was no occasion to consider grant of sanction Under Section 19 of the POC Act. The law on the point is quite clear that sanction to prosecute the public servant for the offences under the POC Act is not required if the public servant had already retired on the date of cognizance by the court."
12. Coming to Section 197 Cr.P.C, it is already explained supra that the petitioner by virtue of clause 12 (b) of Section 21 IPC, is a public servant. However, that status alone is not suffice to extend protection under Section 197 Cr.P.C, unless he fulfils the other conditions laid in that section.
13. It is held by the Apex Court in Mohd. Hadi Raja's case (supra-
3) that -
"Sub Clause (b) of clause twelve of section 21 expressly makes the officers of local authority and corporation established by or under a Central, Provincial or State Act or a government owned company as defined in Section 617 of the Companies Act 1956, public servants. But protection under Section 197 Cr. P.C. is not available to a public servant unless other condition indicated in that Section are fulfilled." (emphasis supplied) Thus, while relating clause 12 (b) of Section 21 IPC to Section 197 Cr.P.C, the Apex Court has perspicuously stated that though a person serving in a corporation established by or under a Central, Provincial or State Act or a Government company as defined in Section 617 of Companies Act 1956 and regarded as public servant 11 within the meaning of Section 21 IPC, still he will not get the protective cover under Section 197 Cr.P.C unless other condition stipulated in that section is fulfilled. The other condition is that such a public servant shall not be removable from his office save by or with the sanction of the Government. Therefore, merely because a person fulfils the conditions under Section 21 IPC to become a public servant is not suffice to get protection under Section 197 Cr.P.C, unless he fulfils the other condition also as mentioned supra. Therefore, the question is whether the petitioner is removable from his office with the sanction of the Government. It is the contention of the petitioner that he was appointed by the President of India and the disciplinary authority to remove him from the service as per clause 11 of the terms and conditions of the petitioner's appointment orders is also the President of India. This aspect has not been challenged by the respondent. In fact, treating him as public servant only the case is charge sheeted for the offences under PC Act. It is already discussed supra that clause 12 (b) of Section 21 IPC and Section 2 (c) (iii) of PC Act are in pari materia. In that view, the petitioner can be said to have fulfilled the conditions stipulated in Section 197 Cr.P.C. His retirement even prior to taking cognizance will not interdict to consider the application of protection under Section 197 Cr.P.C, because of the usage of the phrase 'any person who is or was' in that section (it was so held by apex Court in the cases of Labh Singh [supra-1] and Dr.Budhikota Subbarao [supra-2]). 12
14. Now, in view of the contention raised by learned Special P.P that forming into criminal conspiracy and cheating the organization is not part of the official duty, the crucial aspect for consideration is whether sanction is required to prosecute the petitioner / A-1 for the offences under Section 120-B and 420 IPC. Regarding the question as to what acts committed by public servant would fall within the domain of discharging his official duties, the apex Court and various High Courts have delineated thus.
(i) In Mohd. Hadi Raja's case (supra-3), the apex Court held thus:
"What acts can be alleged to have been committed by a public servant while acting or purporting to act in the discharge of his official duties is a vexed question and had often troubled various courts including this Court. Broadly speaking, it has been indicated in various decisions of this Court that the alleged action constituting the offence alleged to have been committed by the public servant must have a reasonable and rational nexus with the official duties required to be discharged by such public servant."
(ii) In Nirmal Singh Kahlon Vs. State of Punjab and Ors.6, the apex Court held thus:
"13. It appears to be well settled that there has to be proximity between the official duty and the act alleged to have been committed in order to claim protection of Section 197(1) Cr.P.C. If there is no close proximity and the acts are distantly related to the official duty then protection contemplated by Section 197(1) Cr.P.C. would not be available. All these principles have been considered by Hon'ble the Supreme Court in the case of Parkash Singh Badal MANU/SC/5415/2006 (supra). Hon'ble the Supreme Court has placed reliance on its earlier judgments in the cases of Bakhshish Singh Brar v. Gurmej Kaur MANU/SC/0195/1987 :
1988CriLJ419 ; P. Arulswami v. State of Madras MANU/SC/0092/1966 : 1967CriLJ665 ; Matajog Dobey 1956 CriLJ 140 (supra); Rakesh Kumar Mishra v. State of Bihar MANU/SC/0200/2006 : 2006CriLJ808 ; and P.K. Pradhan v. State of Sikkim MANU/SC/0380/2001 : 2001CriLJ3505 . The following principles could be deduced from the observations made by Hon'ble the Supreme Court:6
2008 CrlLJ 4096 = MANU/PH/0688/2008 13
(i) Protection is only when the alleged act done by the public servant is reasonably connected with the discharge of his official duty and is not merely a cloak for doing the objectionable act.
(ii) If in doing public duty, he acted in excess of his duty, but there is a reasonable connection between the act and the performance of the official duty, the excess will not be a sufficient ground to deprive the public servant from the protection.
(iii) It is the quality of the act which is important and the protection of this section is available if the act falls within the scope and range of his official duty. Act can be performed in discharge of official duty as well as in dereliction thereof.
(iii) In Parkash Singh Badal and Ors. vs. State of Punjab and Ors.7, the apex Court held thus:
"34. xxx The offence of cheating under Section 420 or for that matter offences relatable to Sections 467, 468, 471 and 120B 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."
(iv) In Battenapatla Venkata Ratnam's case (supra-5), the apex Court held thus:
"11. The alleged indulgence of the officers in cheating, fabrication of records or misappropriation cannot be said to be in discharge of their official duty. Their official duty is not to fabricate records or permit evasion of payment of duty and cause loss to the Revenue."
15. Thus, the Courts have consistently held that the offences of criminal conspiracy, cheating and other related offences cannot be said to be reasonably connected with the discharge of official duty of an employee, but the official duty was merely a cloak for doing offences. In view of the above jurisprudential jurimetrics, though the 7 2008 CrlLJ 4096 = MANU/PH/0688/2008 14 petitioner is held to be a public servant within the meaning of Section 197 Cr.P.C, still no sanction is required to prosecute him for the alleged offences under Section 120-B and 420 IPC as such acts do not fall within the domain of discharging of his official duties. This point is accordingly answered against the petitioner
16. In the result, in view of the above findings, the criminal petition is dismissed.
As a sequel, Interlocutory Applications pending if any, shall stand closed.
_________________________ U. DURGA PRASAD RAO, J Date: 24.01.2020 MS / PVD