Jammu & Kashmir High Court
J.S. Modi vs State Of J And K Through Chief Secretary ... on 16 March, 2005
Equivalent citations: 2005CRILJ4256, 2005(3)JKJ96
JUDGMENT S.K. Gupta, J.
1. Counter had not been filed in the case despite number of opportunities were granted for the same. However, on the submission made by Mr. B.S. Salathia, learned Additional Advocate General appearing for the respondent-State, objections already filed were treated as counter. The petition was taken up for final disposal with the consent of the" learned counsel appearing for the respective parties.
2. The petitioner is aggrieved of his prosecution under section 5(2) of the J&K Prevention of Corruption Act, 2006, read with sections 409, 419, 420, 467, 468, 471, 477A, 201, and 120B of the Ranbir Penal Code, in challan presented before Special Judge, Anti-Corruption, Jammu and seeks the quashing of FIR No. 34/97 Police Station, Vigilance Organisation, Jammu, registered against him; Government Order No. GAD-26 (Vig.) of 1998 dated 5-5-1998 by which sanction has been granted for his prosecution; and the challan proceedings in case titled State v. J.S. Modi, pending in the trial Court, based on averments made in various paragraphs of the writ petition, by issuance of a writ of certiorari in invoking the extraordinary jurisdiction of this Court under Article 226 of the Constitution of India, read with section 103 of the Constitution of Jammu and Kashmir State.
3. The relevant facts giving rise to this writ petition need to be noticed for appreciating the contentions of the parties. Petitioner, J.S. Modi, was appointed as Deputy Commissioner, Excise, Jammu, and joined on 02-07-1993. Auction for the allotment of the country liquor vends was conducted in the month of March, 1995 by the petitioner, who was heading the Committee appointed for the purpose under the supervision of Excise Commissioner. M/s Kuldeep Singh and others, being the highest and successful bidder in the open auction for the allotment of the country liquor vends in the year 1995-96, formal orders in their favour were issued by the Committee in accordance with the rules. The contractors were required to deposit the instalments as per the rules either in the Bank or Government Treasuries being the common practice followed earlier also in this behalf. Fortnightly instalments were required to be deposited by the contractors in the Government Treasuries as per the old practice and thereafter country liquor permits were issued based on such remittances, by the petitioner. It was during the scrutiny of the files of the contractors, some doubtful Treasury vouchers and Bank receipts were detected by the petitioner. The petitioner further stated to have singled out those suspicious vouchers and receipts and sent them for verification. In the meantime, the petitioner had also taken into confidence the Excise Commissioner and the ACS (Finance) and apprised them of the situation. The doubtful vouchers and receipts detected by the petitioner pertained to Saddar Treasury, Town Hall, Jammu and Jammu & Kashmir Bank, Branch Govindsar, Kathua.
4. The verification reports were received on 3-4-1996 and 4-4-1996 from Saddar Treasury, Jammu and Branch Manager, Jammu and Kashmir Bank, Givindsar, Kathua, respectively, which revealed tampering and forgery, giving the details of huge variation in four receipts out of 61 cash receipts referred for verification. The Treasury Officer in its report of verification of the Treasury vouchers sent to him, concluded that the contractor, Shri Kuldeep Singh S/o Lt. Col. S.D.S. Jamwal, representing the firm, M/s Kuldeep Singh and Company, defrauded the Government revenue by an amount of Rs. 55 lacs by an act of forgery and cheating in respect of Treasury receipts of Saddar Treasury, Jammu. The petitioner, therefore having found on two verification statements that the contractor had cheated the Government for an amount of Rs. 97,50,000/- by forgery either directly or through his representatives, agents or employees, and caused loss to the Government in cheating fraudulently, dishonestly and through deceitful means to make the Department to part with the supply of liquor without proper payment, lodged a written complaint in pursuance of a decision jointly taken by the Additional Chief Secretary (Finance), Excise Commissioner and the petitioner, with the Crime Branch, Police Station, Jammu on 05-04-1996, on the basis of which FIR No. 8/1996 was registered. According to the averments in the petition, an amount of Rs. 90 lacs was deposited by the accused during investigation by the Crime Branch. It is further stated that the FIR was lodged by the petitioner after having detected the forgery and tampering of the Bank receipts and Treasury vouchers with regard to the deposit of the instalments by the contractor and it was at his instance that the case was registered and investigation ensued against the accused. The challan was produced on the conclusion of the investigation against the accused persons explicitly named therein.
5. It was during the pendency of the challan before the Special Judge, Anti-Corruption, Jammu, presented in FIR No. 8/1996 registered at the instance of the petitioner, that an application came to be filed by one of the accused exhibiting his strong grievance against the petitioner and making allegations against him, in the Court, on the basis of which, Vigilance Organisation, Jammu, was directed to inquire into the matter and submit the report. Further case of the petitioner is that the investigation was conducted by the Vigilance Organisation in a most prejudicial manner with the purposive intent to harass and falsely implicate him in order to save the real culprit, registered FIR No. 34/1997 against the petitioner, and on its conclusion presented a challan against the petitioner after obtaining requisite sanction vide Order No. 26-GAD (Vig.) of 1998 dated 05-05-1998, evidently, in shaping the case in such a manner as if the contractor had committed tampering and forgery of the vouchers in conspiracy and collusion with the petitioner, notwithstanding that the earlier FIR No. 8/1996 was registered only on the endeavours and efforts of the petitioner being the Deputy Commissioner, Excise, based on detection of suspicious Treasury vouchers and Bank receipts in respect of the deposits of the instalments from the file of the contractor. The petitioner submitted that the sanction obtained on the basis of a tainted investigation, on the face of it, is illegal and all the proceedings before the trial Court amounted to abuse of the process of the Court and are liable to be quashed.
6. The petitioner also stated that the Government earlier had conducted an enquiry through Commissioner of Inquiries about the occurrence and latter submitted a report, which clearly revealed that it was the petitioner who, on scrutiny of the file of the contractor, detected the fraud committed by the contractor and brought it to the notice of the Additional Chief Secretary, Finance, and Excise Commissioner, which had led to the lodging of FIR No. 8/96 with the Crime Branch at his instance. The amount of Rs. 90 lacs was recovered from the contractor, accused person, during investigation in the case under FIR No. 8/1996 registered at the instance of the petitioner, sheer on account of his timely and prompt action. The findings of the Commissioner of Inquiries came to be accepted by the Government and the petitioner was reinstated vide Government Order No. 735 of 1997 dated 6-6-1997. The Government also promoted the petitioner to the selection grade of KAS, vide its Order No. 1017-GAD of 1997 dated 27th June, 1997. The Investigating Agency of the Vigilance Organisation in reinvesti-gating the case after its registration under fresh FIR against the petitioner, did not take notice of the fact that there was an earlier FIR No. 8/1996 registered against the accused in respect of the same matter, in which challan had been produced after investigation, and that this report having been lodged at the instance of the petitioner, yet it registered second FIR in the case. Even the sanctioning authority while granting the sanction for prosecution against the petitioner did not apply its mind to the fact that the report of Commissioner of Inquiries and the findings returned by him stood accepted by the Government in fully exonerating the petitioner based on the facts and defence taken by him, rendered it illegal and the subsequent proceedings launched in the Court of Special Judge, Anti-Corruption, Jammu, against the petitioner clearly amounts to the abuse of the process of the Court and are not sustainable in law.
7. In refuting the averments of the petitioner, respondents in their detailed reply submitted that the Vigilance Organisation during investigation of the case under FIR No. 34/1997 found that there was no material on record showing that whatever is pleaded in the petition is based on facts. It was further stated that in exercise of writ jurisdiction, appreciation, marshalling and sifting of evidence by the Court is impermissible, which otherwise would amount to pre-trial adjudication of the case pending in a competent Court against the petitioner. That it was under the directions of the Court that FIR No. 34/1997 has been registered by the Vigilance Organisation. The FIR also makes shocking revelations in regard to the involvement of the petitioner and others in duping the State exchequer of crores of rupees and committing serious offences. The respondents further stated that the involvement of the petitioner and others has been fully established in the investigation on the basis of material collected by the Vigilance Organisation and challan against them has been produced in the Court of competent jurisdiction for trial. It is further stated that the petitioner cannot claim to have been absolved of having committed the offence charged against him merely in pleading that the initial FIR in the case was lodged by him. The petitioner, in fact, was himself involved in the conspiracy alongwith other accused persons and committed fraud in depriving the Government of crores of rupees. That the sanction for prosecution against the petitioner had been granted by the Government/Competent Authority vide order dated 05-05-1998 after proper application of mind and is, therefore, legal and valid and, thus, writ petition deserves to be dismissed.
8. Mr. B.S. Salathia, learned Additional Advocate General appearing for the State, at the outset, submitted that the extraordinary powers of the High Court under Article 226 of the Constitution of India cannot be invoked to quash the criminal proceedings. His further submission is that the petitioner should have approached the Court in filing a petition under section 561-A Cr.PC seeking the quashing of the proceedings in order to prevent the abuse of the process of the Court or secure the ends of justice in exercise of its inherent jurisdiction. Whereas Mr. D.C. Raina, on the other hand, in controverting the contention of the respondents' Advocate submitted that vast powers are conferred on the High Court under the Constitution to prevent the abuse of the process of law by the inferior courts and ensure the clean administration of justice at all ends.
9. The spinal question that falls for consideration is as to whether the Constitutional powers can be exercised by the High Court in criminal matters to prevent the abuse of the process of law and ensure the ends of justice. Mr. D.C. Raina contended that in a given situation, some false and vexatious charges of corruption and venality may be maliciously attributed against any person enjoying a respectable status thereby sullying his character, injuring his reputation and exposing him to social ridicule with a view to spite him on account of some personal rancour, predilections and past prejudices of the complainant. In such a piquant situation, Mr. Raina further submits is the million dollars' question as to what would be the remedy that would redress the grievance of the verily affected party, particularly, when acting on such a complaint, FIR is registered, investigation is conducted and on its conclusion challan is presented in the Court? Mr. Raina, petitioner's Advocate, put considerable force and with insistence reiterated that the entire proceedings against the petitioner on account of the false implication in prejudicial manner, tainted or mala fide or lack of bona fide, could be quashed, for having occasioned unnecessary harassment to the petitioner, who happened to be the complainant in the earlier FIR No. 8/1996 against the contractor on the charges of forgery and tampering of the Treasury vouchers and Bank receipts in depriving the State exchequer of crores of rupees in respect of the payment of the instalments of contractual money that pertained to the allotment of country liquor vends in auction, even under Article 227 of the Constitution of India in exercise of its power of superintendence. The scope of High Court's power to quash criminal proceedings in exercise of its power under Articles 226 and 227 of the Constitution of India or section 482 Cr. PC. (Central) corresponding to section 561-A of the J&K Code of Criminal Procedure came up for consideration before the Apex Court in case Pepsi Food Limited and Anr. v. Special Judicial Magistrate and Ors., , and it was held as under:
"22. It is settled that the High Court can exercise its power of judicial review in criminal matter. In State of Haryana v. Bhajan Lal this Court examined the extraordinary power under Article 226 of the Constitution and also the inherent powers under Section 482 of the Code which it said could be exercised by the High Court either to prevent abuse of the process of any court or otherwise to secure the ends of justice. While laying down certain guidelines where the court will exercise jurisdiction under these provisions, it was also stated that these guidelines could not be inflexible or laying rigid formulae to be followed by the courts. Exercise of such power would depend upon the facts and circumstances of each case but with the sole purpose to prevent abuse of the process of any court or otherwise to secure the ends of justice. One of such guidelines is where the allegations made in the first information report or the complaint, even if they are taken at their face value and accepted in their entirety do not prima facie constitute any offence or make out a case against the accused. Under Article 227 the power of superintendence by the High Court is not only of administrative nature but is also of judicial nature. This article confers vast powers on the High Court to prevent the abuse of the process of law by the inferior courts and to see that the stream of administration of justice remains clean and pure. The power conferred on the High Court under Articles 226 and 227 of the Constitution and under Section 482 of the Code have no limits but more the power more due care and caution is to be exercised while invoking these powers. When the exercise of powers could be under Article 227 or Section 482 of the Code it may not always be necessary to invoke the provisions of Article 226. Some of the decisions of this Court laying down principles for the exercise of powers by the High Court under Articles 226 and 227 may be referred to."
"23. In Waryam Singh v. Amarnath this Court considered the scope of Article 227. It was held that the High Court has not only administrative superintendence over the subordinate court and tribunals but it has also the power of judicial superintendence. The Court approved the decision of the Calcutta High Court in Dalmia Jain Airways Ltd. v. Sukumar Mukherjee where the High Court said that the power of superintendence conferred by Article 227 was to be exercised most sparingly and only in appropriate cases in order to keep the subordinate courts within the bounds of their authority and not for correcting their mere errors. The Court said that it was, therefore, a case which called for an interference by the Court of the Judicial Commissioner and it acted quite properly in doing so."
"24. In Bathumal Raichand Oswal v. Laxmibai R. Tarta this Court again reaffirmed that the power of superintendence of the High Court under Article 227 being extraordinary was to be exercised most sparingly and only in appropriate cases. It said that the High Court could not, while exercising jurisdiction under Article 227, interfere with the findings of fact recorded by the subordinate court or tribunal and that its function was limited to seeing that the subordinate court or tribunal functioned within the limits of its authority and that it could not correct mere errors of fact by examining the evidence or reappreciating it. The Court further said that the jurisdiction under Article 227 could not be exercised, "as the cloak of an appeal in disguise. It does not lie in order to bring up an order or decision for rehearing of the issues raised in the proceedings". The Court referred with approval the dictum of Morris, L.J. in R. v. Northumberland Compensation Appeal Tribunal."
"25. In Nagendra Nath Bora v. Commr. Of Hills Division this Court observed as under:
"It is thus, clear that the powers of judicial interference under Article 227 of the Constitution with orders of judicial or quasi-judicial nature, are not greater than the powers under Article 226 of the Constitution. Under Article 226, the power of interference may extend to quashing an impugned order on the ground of a mistake apparent on the face of the record. But under Article 227 of the Constitution, the power of interference is limited to seeing that the tribunal functions within the limits of its authority"."
"26. Nomenclature under which petition is filed is not quite relevant and that does not debar the court from exercising its jurisdiction which otherwise it possesses unless there is special procedure prescribed which procedure is mandatory. If in a case like the present one the court finds that the appellant could not invoke its jurisdiction under Article 226, the court can certainly treat the petition as one under Article 227 or Section 482 of the Code. It may not, however, be lost sight of that provisions exist in the Code of revision and appeal but some time for immediate relief Section 482 of the Code or Article 227 may have to be resorted to for correcting some grave errors that might be committed by the subordinate courts. The present petition though filed in the High Court as one under Articles 226 and 227 could well be treated under Article 227 of the Constitution."
10. The net deductions from the ratio of the aforesaid judgment of the Apex Court could evidently be drawn that in order to correct the error of trial subordinate court or for quashing the proceedings that have resulted in abuse of the process of the Court, or to secure the ends of justice, the petitioner can approach the High Court by filing a petition under Articles 226 and 227 of the Constitution of India or section 561-A of the J & K Code of Criminal Procedure; and in these circumstances of the case, the petitioner has rightly approached the High Court. Nomenclature of the petition filed becomes irrelevant and would not debar the Court from exercising its jurisdiction, which it otherwise possesses.
11. It may further be pointed out that in a case where police transgresses its powers of investigation, the High Court under section 561-A of the Cr.PC or Articles 226/227 of the Constitution of India in appropriate case can interdict the investigation to prevent abuse of the process of the Court or otherwise to secure the ends of justice. In view of the detailed and searching analysis of the aforesaid legal issue raised by Mr. Salathia, the resultant and inescapable logical conclusion which unreservedly reached is that the High Court can quash the criminal proceedings at any stage in exercise of its jurisdiction under Article 227 or section 561-A Cr.PC though the petition is filed under Article 226, which otherwise can be treated as one under Article 227 or under section 561-A Cr.PC. The contention raised by Mr. Salathia, therefore, is bereft of any substance and devoid of any legal force, thus, cannot be accepted.
12. The main thrust of the petitioner's advocate, Mr. D.C. Raina, during arguments is that there can be no second FIR about the same occurrence and against the person, who is the complainant and a star witness of the first FIR and consequently there could be no fresh investigation and production of a challan in the Court of law based on second FIR. His further submission is that the essence of both the FIRs showing the same date and place of occurrence and narration of events, the recording of subsequent FIR, which is second FIR, was unwarranted and illegal and, thus, deserves to be quashed. It is not in dispute that the petitioner, J.S. Modi, was Deputy Commissioner, Excise, at the relevant time. Auction of country liquor vends of Jammu Province was conducted by him for the year 1995-1996 on 28-03-1995 and its determined licence fee was Rs. 3326.15 lacs. M/s Kuldeep Singh and Company being the highest bidder was allotted the contract for an amount of Rs. 13,23,00,000/- for the groups described as R.S. Pura, Akhnoor, Samba, Kathua, Sunderbani and Udhampur. The contractor was required to deposit the instalments into the Government Treasury and on the basis of such remittances, permits for country liquor vends were issued as per the past prevalent practice. The petitioner, as is borne out from the record, during scrutiny of the files of the contractor, detected some Treasury vouchers and Bank receipts to be doubtful. The said Treasury vouchers and Bank receipts were sent for verification to the respective places and on the receipt of verification report, it was found that tampering and forgery had been made by the contractor in respect of the Treasury vouchers and Bank receipts in the deposit of the amount. From the verification report, the petitioner is stated to have found that there was a variation of huge amount described in the treasury vouchers and the bank receipts and the amount deposited in the respective bank branch and the treasuries, which established that the firm, M/s Kuldeep Singh and Company, through its partner Kuldeep Singh, knowingly and deliberately with criminal intention to commit forgery and fraud by tampering the treasury vouchers and bank receipts in order to cheat and deceit the department, caused a huge loss to the State exchequer for gainful purpose, and the petitioner after taking into confidence the Additional Chief Secretary (Finance) and Commissioner, Excise, to whom he stated to have apprised earlier also when on scrutiny he found the treasury vouchers and bank receipts doubtful and, in pursuance of collective decision, lodged a written report with the SP, Crimes and Railways, Jammu on 05-04-1996, which formed the basis of FIR No. 8/1996 for offences under sections 409, 420, 467, 468, 120B, 471 RPC. It is also not in dispute that the petitioner being complainant was the prime witness in the said FIR against the accused mentioned therein and in respect of whom documentary evidence was stated to have been collected by the petitioner and provided during investigation to the police in the case. It is also borne out that after investigation of the case against the accused under FIR No. 8/1996, the challan was presented in the Court of law. It is stated that it was at that time some persons including the one against whom the petitioner had made the report and a case under FIR No. 8/1996 was registered, in which he had to appear as a main witness being the complainant, made an attempt to involve the petitioner falsely and without basis in the case with the sole purpose to malign his reputation, on the basis of which a false case was registered with the Vigilance Organization about the same occurrence alleging a criminal conspiracy against the petitioner in accepting the fake and forged treasury vouchers and Bank receipts indicating inflated amounts to have been deposited in the treasury and banks.
13. The second FIR, according to Mr. D.C. Raina, learned senior counsel appearing for the petitioner, about the same incident, when on comparison of both the FIRs, the essence of narration of the events is the same, and initiating a fresh investigation and thereafter presenting a challan in the Court against the petitioner, who happened to be complainant and remained main witness in the first FIR, is a clear case of abuse of the statutory powers to investigate in a given case and the whole proceedings need to be quashed by the Court in exercise of its powers under section 561-A of the Code of Criminal Procedure or Article 227 of the Constitution of India. Whereas Mr. B.S. Salathia, learned Additional Advocate General, on the other hand, submitted that the petitioner, who happened to be Deputy Commissioner, Excise, Jammu, at that time, in fact, had failed to provide effective supervision over his staff, as is envisaged in the Financial Code. He further submitted that the contractor, Kuldeep Singh, had defrauded the Excise Department of substantial revenue by producing forged and tampered treasury vouchers and bank receipts. According to Mr. Salathia, this could not be done by the contractor and fraud was committed due to administrative lapse of the petitioner and other officials of the Excise Department. He also contended about the close association of the petitioner and Kuldeep Singh, partner in the firm, M/s Kuldeep Singh and Company, to whom contract was allotted and latter arranged Goa trip for the petitioner and his wife at the firm's expenses, which is a clear evidence of criminal conspiracy between them to do illegal act with illegal means, viz., dupe the State exchequer of huge amount by producing forged and tampered receipts with regard to the remission of amount into the treasuries and banks and obtaining permits from the petitioner. In these circumstances, the Investigating Agency is not precluded from further investigation in respect of an offence and presenting a final report in the form of a challan in the Court against the petitioner.
14. An information oral or in writing of a cognizable offence made in first point of time and entered in the diary of the Police Station, is only known as First Information Report under sub-section (1) of section 154 of the Cr.P.C. This report sets into motion the machinery responsible for the maintenance of law and order based on which the investigation is commenced and its conclusion leads to the formation of an opinion in forwarding the Police Report in the Court of law under section 173 Cr.PC.
15. Now the question arises as to whether there can be a second FIR in respect of the same cognizable offence, same incident or occurrence? In T.T. Antony v. State of Kerala and Ors., , the Apex Court considered the question of registering the second FIR and making fresh investigation, when all the charges in the first and the second FIR, in substance, are the same, and held as under:
"18... the information first entered in the station house diary, kept for this purpose, by a police officer in charge of a police station is the first information report - FIR postulated by Section 154 CrPC. All other informations made orally or in writing after the commencement of the investigation into the cognizable offence disclosed from the facts mentioned in the first information report and entered in the station house diary by the police officer or such other cognizable offences as may come to his notice during the investigation, will be statements falling under Section 162 CrPC. No such information/statement can properly be treated as an FIR and entered in the station house diary again, as it would in effect be a second FIR and the same cannot be in conformity with the scheme of CrPC."
16. It, therefore, follows that if the gravamen of the charges in the two FIRs is, in substance and truth, the same, the registration of the second FIR in making fresh investigation and forwarding report under section 173 Cr.PC will be irregular and the Court cannot take cognizance of the same. Undoubtedly, investigation into a cognizable offence is the statutory right of the police and the Court does not possess any supervisory jurisdiction under the Code of Criminal Procedure over it. But this does not mean that the plenary power of the police to investigate a cognizance offence is unlimited. It is always subject to certain well-recognized limitations. Where the police exceeds its statutory power of investigation in the cognizable offence, the High Court in exercise of its extraordinary power under Articles 226/227 of the Constitution of India or the inherent powers under section 561-A of the Code of Criminal Procedure has to strike down the expansive powers of police to investigate. The categories of cases by way of illustration in which such powers could be exercised either to prevent the abuse of the process of the Court or otherwise to secure the ends of justice, have been enumerated by the Apex Court in case State of Haryana and Ors. v. Bhajan Lal and Ors., .
17. The Apex Court in T.T. Antony's case, referred supra, further observed in para 27 of the judgment as under:
"27. A just balance between the fundamental rights of the citizens under Articles 19 and 21 of the Constitution and the expansive power of the police to investigate a cognizable offence has to be struck by the court. There cannot be any controversy that sub-section (8) of Section 173 CrPC empowers the police to make further investigation, obtain further evidence (both oral and documentary) and forward a further report or reports to the Magistrate. In Narang case it was, however, observed that it would be appropriate to conduct further investigation with the permission of the court. However, the sweeping power of investigation does not warrant subjecting a citizen each time to fresh investigation by the police in respect of the same incident, giving rise to one or more cognizable offences, consequent upon filing of successive FIRs whether before or after filing the final report under Section 173(2) CrPC. It would clearly be beyond the purview of Sections 154 and 156 CrPC, nay, a case of abuse abuse of the statutory power of investigation in a given case. In our view a case of fresh investigation based on the second or successive FIRs, not being a counter-case, filed in connection with the same or connected cognizable offence alleged to have been committed in the course of the same transaction and in respect of which pursuant to the first FIR either investigation is under way or final report under Section 173(2) has been forwarded to the Magistrate, may be a fit case for exercise of power under Section 482 CrPC or under Articles 226/227 of the Constitution."
Adverting to the facts of the case, the Government at its own level also conducted enquiry against the petitioner through the Commissioner of Inquiries. A detailed report submitted to the Government by the Inquiry Officer with regard to the allegations against the petitioner including a criminal conspiracy alongwith other officers and the contractor, M/s Kuldeep Singh and Company, to whom the country liquor vends were allotted, and returned findings on the conclusion of the Inquiry, in which he found the petitioner not guilty of the charges levelled against him. The report of the Inquiry Officer stood accepted by the Government and its findings are discussed as under:
"i/ Charged Officer does not dispute the defraud committed by the Contractor, M/S Kuldip Singh and Co. to the tune of Rs. 299.80 lacs.
ii/ Both the parties admits that this act of crime committed by the said Contractor by producing forged, fictitious and tempered receipts before the Deputy Commissioner Excise, hi/ And this act of the contractor was detected by the charged officer, while verifying the receipts produced by the Contractor in routine matter.
iv/ By observing some doubtful receipts, the charged officer referred these receipts to Treasury/Bank for verification. After being confirmed by the concerned Treasury and Bank, that the original receipts were forged, tempered and by doing so the Contractor has mis-appropriated an amount of Rs. 97.50 lacs.
v/ This act of crime was brought to the notice of Excise Commissioner (Acs) Finance by the charged officer.
vi/ The Charged Officer lodged a FIR with the Crime Branch against the Contractor, M/S Kuldip Singh & Co. vii/ Subsequently the Finance Department appointed Special Audit Committee to verify and reconcile the remittance reported to have been made by Liquor Contractor during the year 1994-95 and 1995-96. The Committee observed that the Contractor M/S Kuldip Singh and Co. swindled the Government money to the tune of Rs. 299.80 lacs by producing fake, and fictitious receipts.
viii/ Same was communicated to the Crime Branch and the FIR are lodged by the Charged Officer, was accordingly modified.
ix/ The Crime Branch submitted its report (copy enclosed) forming Annexure "A", and the involved persons have been booked. In the report it is stated that "The facts which have emerged during the course of investigation clearly establish that the supervisory level control in the Excise Department particularly at the level of D. Commissioner Excise has been lax, and the officer(s) have been remiss in exercising requisite amount of care, caution and vigil which was mandatory and obligatory on their part."
x/ The report also stated that the "complainant Mr. J.S. Modi originated a letter No. 15088/Exc dated; 29-3-1996 addressed to Manager J&K Bank Govindsar for verification of 61 items for Rs. 2,21,25024/- and handed it over to accused Narinder Sharma and Sardari Lal Inspectors of Excise Deptt: with the directions that verification report be obtained from the concerned Bank in person. However, both the accused Inspectors in league with the other accused partners of the said firm did not get verification from the concerned Bank but the fake verification report on behalf of concerned Bank was fabricated and handedover to the complainant (J.S. Modi) of the case."
xi/ The Crime Branch admits that they could not corroborate evidence to implicate Mr. J.S. Modi (complainant).
xii/ From all the records, it is proved that it was Mr. J.S. Modi, Charged Officer first detect this fraud committed by the Contractor and brought it to the notice of Excise Commissioner and Acs (Finance) and lodged the FIR with Crime Branch against the Contractor and is the main witness on behalf of the Government.
xiii/ It is because of his prompt action Government could recover Rs. 90.00 lacs out of embezzled money and the statement of defence furnished by Charged Officer was found based on the fact and neither the Crime Branch report nor presentation note challenges his statement.
Therefore, Shri J.S. Modi, Charged Officer is not found guilty of the charges levelled against him."
18. On the acceptance of the findings of the Inquiry Officer, the Government vide Order No. 735-GAD of 1997 dated 06-06-1997 reinstated the petitioner with immediate effect in treating the period of suspension of the Officer on duty and posted him as Deputy Chief Electoral officer against the available post. Again by referring to the Cabinet Decision No. 144/16 dated 25-06-1997, the Government vide its Order No. 1017-GAD of 1997 dated 27-06-1997 also released the Selection Grade of KAS, viz., Rs. 3700-5000 in favour of the petitioner w.e.f. 04-04-1997, the date when his juniors had been granted the same. Commissioner of Inquiries is a fact finding Inquiry and its report and findings are meant for the information of the Government. Acceptance of the report of the Commissioner of Inquiries by the Government would only suggest that being bound by the rule of law and having duty to act fairly, it has endorsed to act upon it. The Investigating Agency, therefore, may with advantage make use of recommendation of the Commissioner in performance of its onerous task of investigation bearing in mind that it does not preclude the Investigating Agency from forming a different opinion though such findings or reports are not binding on the civil or criminal Courts, since they have to arrive at their own conclusion based on the evidence before them in accordance with law.
19. On going through the entire material scrupulously, I am of a considered opinion that minus the allegations of corruption and criminal conspiracy of the petitioner with the other Excise officers, on comparison, the narration of events, in substance, showing the date and place occurrence, the mode and tenor in both the FIRs was the same. Subsequent FIR is the second FIR, which manifestly appears to be the articulation of impassioned and impetuous of police officers in overstepping their permissible limits in taking a rash decision in registering the FIR and commencing the investigation in ignoring clandestinely the findings of the Commissioner of Inquiries, its acceptance by the Government and further steps taken in reinstating the petitioner treating his suspension period on duty and further in pursuance of a Cabinet Decision sanctioned the Selection Grade of KAS in acting fairly being bound by law. The recording of the second FIR and switching on a fresh investigation by the Investigating Agency, evidently, was the act unwarranted by law and, thus, illegal. Challan/final report presented in the Court of law based on the second FIR and further continuation of the proceedings in the Court certainly amounts to abuse of the process of the Court and is a fit case for exercising powers under section 561-A of the Cr.PC to quash the same. However, the petitioner cannot be tried for any offence when he is a complainant in the report to the same incident and a charge sheet is pending in the court. He is the prime witness being a complainant in the said case under FIR No. 8/1996.
20. Mr. Raina further submitted that the petitioner cannot be tried for commission of the alleged offence when for the same allegation he was subjected to departmental enquiry and was exonerated by the Government, and thereafter promoted also. I find great substance and merit in this submission made by the senior learned petitioner's advocate, particularly, when its factual aspect has not been disputed by Mr. Salathia, learned Additional Advocate General appearing for the State.
21. It was next contended by Mr. Raina that the sanction to the prosecution of the accused-petitioner has been granted without proper appreciation of the material and lack of application of mind. He further submitted that the sanction being invalid, no cognizance could be taken by the Court of offences in which the challan has been presented and the entire proceedings deserve to be quashed by the Court in exercise of its inherent jurisdiction to prevent the abuse of the law.
22. It is apt to point out that section 561-A Cr.PC saves an inherent powers in the High Court and such powers can be exercised to prevent the abuse of the process cf the High Court or otherwise to secure the ends of justice. The grounds on which the prosecution initiated against the accused, can be quashed by the Court in exercise of powers conferred under section 561-A Cr.PC, were considered in detail in State of Haryana and Ors. v. Bhajan Lal and Ors., .
23. One of the grounds laid down in clause (6) on which power under section 561-A of the Cr. PC can be exercised to quash the criminal proceedings, is that "where there is an express legal bar engrafted in any of the provisions of the Code of Criminal Procedure or the concerned Act to the institution and continuance of the proceedings." But this power has to be exercised with great circumspection. There are some statutes, which place a bar on the power of the Court from taking cognizance of the offences, such as in the matters of granting sanction by the competent authority, under section 6 of the Prevention of Corruption of Act. Where all the facts were not brought to the notice of the sanctioning authority and sanction was accorded without application of mind, it would be a defective sanction. All that is required and expected of a sanctioning authority to do is that he should apply his mind to the facts of the case and then decide whether on such facts there should be a prosecution. The sanction under the Act is not intended to be an automatic formality and it is essential that the provisions in regard to the sanction should be observed with complete strictness. The intention of the legislature in providing for a sanction in respect of offences covered by section 6 is merely to afford a reasonable protection to the public servants in the discharge of their official function. In fact, the sanction is a safeguard for the innocent and is not a shield for the guilty.
24. Since the necessity for the sanction is based on the principle that public servants should be protected from irresponsible and malicious prosecutions, the prosecution should not only produce the order granting sanction, but should satisfy the Court that the order was made after the sanctioning authority had fully applied his mind to the facts on the basis of which a charge was levelled against the accused. The order of sanction, therefore, must show that all relevant materials were placed before the sanctioning authority for sanctioning prosecution and that the authority considered those materials and the order of sanction flows therefrom. In other words, existence of a valid sanction is a condition precedent to the institution of prosecution. On going through the sanction to the prosecution of the accused by the Government vide Order No. 26-GAD of 1998 dated 5-5-1998, it is clearly demonstrated that the fact about the registration of FIR No. 8/1996 against the contractor, M/s Kuldeep Singh, who was allotted the country liquor vends, on a written complaint of the petitioner and the investigation carried out by the Crime Branch, Jammu, resulted in presentation of challan in the Court of law against them and in which the prime witness is the petitioner himself does not find place in it. The petitioner is the complainant in that case, who, in fact, detected the forgery and tampering of the treasury vouchers and bank receipts showing deposit of inflated amounts. The sanction also does not disclose that enquiry was conducted by the Commissioner of Inquiries under the orders of the Government against the petitioner and in the detailed report submitted to the Government, it was clearly recorded that J.S. Modi charged officer is not found guilty of the charge levelled against him. Further fact that the report was accepted by the Government and based on this report, the petitioner was reinstated and treated on duty during suspension period and also given promotion to the Selection Grade of the KAS, also does not find mention. All this was done much prior to the sanction granted by the competent authority for prosecution of the petitioner. All facts having been withheld from the sanctioning authority, which if placed before it, the sanctioning authority may have changed its mind with regard to the grant of the sanction. This clearly shows the lack of application of mind by the sanctioning authority for granting the sanction. The object of placing of relevant material before the authority sanctioning prosecution is nothing more than to ensure discouragement of frivolous, doubtful and impolitic prosecutions.
25. Since the correctness of the validity of the sanction order has been assailed before this Court, the Apex Court in case Mansukhlal Vithaldas Chauhan v. State of Gujarat, , considered the question of validity of sanction and held as under:
"19. Since the validity of "Sanction" depends on the applicability of mind by the sanctioning authority to the facts of the case as also the material and evidence collected during investigation, it necessarily follows that the sanctioning authority has to apply its own independent mind for the generation of genuine satisfaction whether prosecution has to be sanctioned or not. The mind of the sanctioning authority should not be under pressure from any quarter nor should any external force be acting upon it to take a decision one way or the other. Since the discretion to grant or not to grant sanction vests absolutely in the sanctioning authority, its discretion should be shown to have not been affected by any extraneous consideration. If it is shown that the sanctioning authority was unable to apply its independent mind for any reason Mohd. whatsoever or was under an obligation or compulsion or constraint to grant the sanction, the order will be bad for the reasons that the discretion of the authority "not to sanction" was taken away and it was compelled to act mechanically to sanction the prosecution."
Further, the Apex Court held that:
"17. Sanction lifts the bar for prosecution. The grant of sanction is not an idle formality or an acrimonious exercise but a solemn and sacrosanct act which affords protection to Government Servants against frivolous prosecutions. (See : Mohd. Iqbal Ahmed v. State of Andhra Pradesh, ). Sanction is a weapon to ensure discouragement of frivolous and vexatious prosecutions and is a safeguard for the innocent but not a shield for the guilty."
In Gokulchand Dwarkadas Morarka v. The King, AIR 1948 PC 82, it was pointed out:
"The sanction to prosecute is an important matter, it constitutes a condition precedent to the institution of the prosecution and the Government have an absolute discretion to grant or withhold their sanction. They are not, as the High Court seem to have thought, concerned merely to see that the evidence discloses a prima facie case against the person sought to be prosecuted. They can refuse sanction on any ground which commends itself to them, for example, that on political or economic grounds they regard a prosecution as inexpedient. Looked at as a matter of substance it is plain that the Government cannot adequately discharge the obligation of deciding whether to give or withhold a sanction without a knowledge of the facts of the case."
26. From the ratio of the aforesaid judgment, it is clearly demonstrated that the validity of the sanction would, therefore, depend upon the material placed before the sanctioning authority and the fact that all the relevant facts, material and evidence have been considered by the sanctioning authority. Consideration implies application of mind.
27. In the present case, it may be pointed out at the risk of repetition that the order of sanction in its plain reading does not recite the facts with regard to the registration of a case under FIR No. 8/1996 about the same incident, registered against the firm, M/s Kuldeep Singh and Company, Jammu, to whom the contract of country liquor vends was allotted, for having committed fraud, duping and cheating and swindled crores of rupees of the Government exchequer by producing fake and fictitious receipts, on a written complaint lodged by the petitioner, Jagjit Singh Modi, and he was a complainant in the said case. The record further revealed that this complaint was lodged with the Crime Branch, Jammu, on a decision taken jointly by ACS (Finance) and Commissioner, Excise. After investigation, the challan against M/s Kuldeep Singh and Company had been produced in the Court and was pending trial. No material to this effect was provided to the sanctioning authority. The record further shows that the Government appointed the Commissioner of Inquiries to enquire into the whole matter. Dr. Kotru, Director, Finance, was a Presenting Officer, vide Government Order No. 4-F of 1997 dated 28-1-1997. The Commissioner of Inquiries in its report submitted to the Government recorded a finding that the Crime Branch, admits that they could not corroborate evidence to implicate the petitioner (complainant). All the records produced and perused by him proved that it was the petitioner, charged officer, who first detected the fraud committed by the contractor, M/s Kuldeep Singh and Company, and brought to the notice of the Excise Commissioner and ACS (Finance) and lodged a report with the Crime Branch and further that an amount of Rs. 90 lacks out of the embezzled money was recovered because of the prompt action of the petitioner and in the penultimate para of the report reached the finding that the petitioner, Mr. J.S. Modi, charged officer, herein petitioner, is not found guilty of the charge levelled against him. Further, based of this report, the Government reinstated the petitioner declared his period of suspension to be on duty and also sanctioned Selection Grade of the KAS in his favour. Neither these facts are borne out from the sanction nor any material has been placed before the sanctioning authority, so that the same could be considered by him before exercising a discretion of granting or withholding the sanction in the case. In such circumstances, the sanction accorded to the prosecution of the accused cannot be said, by any stretch of reasoning, to have been given after due application of mind and is, thus, rendered invalid. I am, thus, satisfied that the present prosecution was launched without any valid sanction and, therefore, the cognizance taken by the Special Judge was completely without jurisdiction.
28. Keeping in view the legal principles and the factual scenario, in my view, inevitable conclusion reached is that FIR No. 34/1997 Police Station, Vigilance Organization, Jammu, registered against the petitioner and further sanction vide Government Order No. 26-GAD (Vig) of 1998 dated 05-05-1998 for launching prosecution and based on such prosecution and the investigation, challan proceedings in the Court of Special Judge, Anti-Corruption, Jammu, are ordered to be quashed by a writ of certiorari. The writ petition is, accordingly, allowed.
29. The petitioner is on bail. His bail bonds shall stand cancelled.