By TIOL News Service

CHENNAI, DEC 23, 2013: ON a complaint lodged on 5.3.2012, by a person by name F.Ubaidullah (8th respondent), to the effect that the petitioner C. Rajan, who was working as Additional Director General of Revenue Intelligence, Chennai demanded illegal gratification, a first information report was registered on the file of the Central Bureau of Investigation, Chennai for alleged offence under Section 7 of the Prevention of Corruption Act, 1988. A trap was organised in pursuance of the first information report and the petitioner, Rajan was arrested and remanded to judicial custody on 7.3.2012. Police custody was granted by the Special Court for CBI Cases during the period 9.3.2012 to 12.3.2012. Eventually, the petitioner was released on bail on 19.4.2012.

Thereafter, the petitioner sent representations to the Prime Minister with copies to the Minister of Finance. The petitioner also sent representations on 12/14.7.2012 to the Secretary to Government, Revenue Department as well as to the Director General of Revenue Intelligence. The grievance of the petitioner, as projected in his representations dated 12.7.2012 and 14.7.2012 was that he detected economic fraud of huge proportions by Hyundai Motors Limited and JSW Steels Ltd., and that with a view to stall the progress in the investigation into those huge economic frauds, a conspiracy was hatched to fix him in a false case of demand and acceptance of illegal gratification.

But, the representations given by the petitioner did not evoke any response. Therefore, the petitioner is before the High Court with these writ petitions. In W.P.No.22373 of 2012, the petitioner prays for the issue of a Writ of Mandamus to direct an investigation by a Special Investigation Team, to investigate the circumstances in which the first information report was registered against the petitioner and to take action against those responsible for fabricating false evidence and initiating illegal criminal proceedings against him. In the second writ petition W.P. No.22374 of 2012, the petitioner prays for a Writ of Mandamus to forbear the Director, the Director General of Police, the Additional Superintendent of Police and the Deputy Superintendent of Police of the CBI from taking any further action on the basis of the first information report registered against him in R.C.M.A.No.1/2012.

The Petitioner stated:

(i) that he issued a show cause notice on 22.2.2012 to JSW Steels Ltd, about the suspected duty evasion of Rs.302crores;

(ii) that he received a phone call from the second respondent viz., the Director General of Revenue Intelligence on 23.2.2012, instructing him not to issue show cause notice;

(iii) that the Director General told him that he was in distress due to the initiation of show cause notice to JSW Steels and that one Ms.Omita Paul, working in the Ministry of Finance was intermeddling and pressurising him to withdraw the show cause notice; and

(iv) that after the petitioner made it clear to the Director General on 23-2-2012, that he could not withdraw the show cause notice, the Directorate of Revenue Intelligence issued a letter dated 24.2.2012, directing the show cause notice to be kept in abeyance.

The High Court observed that the above averments cannot be brushed aside wholly as the products of a figment of imagination. These averments are specific, with reference to dates, events and persons concerned. Since these averments directly relate to the second respondent (DG DRI), one would expect the DG to meet these averments by filing a counter. But the counter affidavit on behalf of the DG, who is at Delhi, has been filed by an Additional Director General at Chennai, who is also of the same rank as that of the writ petitioner. In the said counter affidavit filed on behalf of the DG, the deponent to the counter affidavit has stated the following:-

(i) that once a show cause notice is issued, there is no provision to retrieve/ recall/cancel it under the Customs Act, 1962;

(ii) that since the show cause notice was issued on 22.2.2012, the question of keeping it in abeyance does not merit any legal sanctity;

(iii) thatJ.S.W. Steel Limited made a representation on the same issue on 14.2.2012 along with the legal opinion of the former Hon'ble Chief Justice of India;

(iv) that the said representation along with the legal advise was duly forwarded to the Competent Authority in the Central Board of Excise and Customs on 24.2.2012;

(v) that in view of the same, a letter dated 24.2.2012 was issued to the Chennai Zonal Unit, directing them to keep the show cause notice in abeyance until a clarification was received from the Competent Authority.

The High Court noted,

“Paragraphs 3 and 4 of the counter affidavit filed on behalf of the second respondent, on the above crucial aspects, contain conflicting and contradictory statements and they are hardly convincing. First of all, the specific averment of the writ petitioner that the Director General called him on phone on 23.2.2012 and instructed the petitioner not to issue the show cause notice, is not even denied in paragraphs 3 and 4 of the counter affidavit filed on behalf of the second respondent. One would have expected, at least a formal denial, but the same is also missing in the counter affidavit. The counter affidavit, on behalf of the respondents 1 and 2, is filed by an Additional Director General, who has his Office only at Chennai. Therefore, obviously, he could not have had any personal knowledge as to whether the Director General spoke to the writ petitioner over phone on 23.2.2012 or not, as claimed by the petitioner in paragraph 13 of his affidavit. Since the Director General has not chosen to file any counter affidavit and also since he has not even instructed the deponent viz., the Additional Director General to make at least a formal denial, I have no option except to conclude that what is not denied is deemed to have been accepted.”

The Court further noted, “One more important aspect to be kept in mind is that the motive of the writ petitioner in making allegations of malafides, does not appear to be just to walk out of the criminal case unharmed. He is not even asking for quashing the proceedings. All that he is asking is only a fair investigation into the whole gamut of circumstances which led to the criminal complaint and the trap.”

The High Court noted the Supreme Court observation that the desiredobject of the Prevention of Corruption Act, is not only to prevent corruption among the public servants, but also to prevent the harassment of the honest among them. The Court is duty bound to see that the machinery under the Prevention of Corruption Act is not misused to harass an honest public servant, by or at the instance of persons against whom he takes action in the course of his official duties.

The High Court while noting that it was not a trial Court, virtually tore up the CBI trap case.

The High Court noted the sequence of events as per the several Mahazars prepared by CBI.:

1. The Complainant (against whom there were several cases and who was detained twice under COFEPOSA twice), independent witnesses and CBI officials assemble at CBI office at 6.00 am on 6.3.2012. Two bundles of thousand rupee notes and i-pad were smeared with phenolphthalein powder. The complainant was instructed to proceed to the entrance of the residential quarters where C. Rajan, the DRI ADG lived and where his driver allegedly asked the complainant to meet him. One of the independent witnesses was asked to accompany the defacto complainant to overhear the conversation. This mahazar closed at 7.55 am.

2. the car of the complainant went to the residential quarters of the writ petitioner at 9.00 A.M. The complainant allegedly talked to the driver of the writ petitioner. Thereafter, the complainant got into his car and returned to the Central Bureau of Investigation Office, stating that the petitioner had asked him through his driver to come to the DRI Office at T.Nagar by 4.00 P.M., in the Evening.

3. The third Mahazar viz., the Recovery Mahazar shows that at about 16.30 hours, the complainant was allegedly informed by the driver of the writ petitioner that the writ petitioner had gone to the Roman Catholic Church in Mylapore opposite to the Music Academy. According to the Recovery Mahazar, all the team members along with independent witnesses proceeded to the Roman Catholic Church premises around 18.00 hours. The official vehicle of the writ petitioner was there inside the premises and the driver Murugesan was seen standing near the car. As per the Recovery Mahazar, the defacto complainant proceeded to meet the driver in the Church premises. But the driver came to the road and met the complainant. The tainted money and the iPad were allegedly handed over by the complainant to the driver at that time and the driver is stated to have taken them to his car. The complainant was allegedly informed by the driver that the writ petitioner was not in the Church and that only his wife was inside the Church and that the driver had to drop the wife of the writ petitioner at her residence and to pick up the writ petitioner from his Office at T.Nagar.

4.   The Recovery Mahazar then proceeds on the basis that by about 18.45 hours, the official car of the writ petitioner started moving out of the Church premises. But for some inexplicable reasons, the team members of the Central Bureau of Investigation did not follow the car. On the contrary, they reached the Office of the writ petitioner around 19.20 hours. The official car of the writ petitioner, even according to the Recovery Mahazar, reached the DRI Office, T.Nagar only at 19.50 hours. At that time, the wife of the writ petitioner was not in the car. It means that the driver of the writ petitioner took the wife of the writ petitioner from the Church, dropped her at her residential quarters and thereafter reached the Office of the writ petitioner. After picking up the writ petitioner by about 19.50 hours, the car reached the residential quarters. It was followed by the team members and the witnesses.

The High Court observed, “Normally one would have expected the Central Bureau of Investigation to instruct the complainant to hand over the money, even if it be to an agent or a trusted lieutenant of the accused, only in the presence of the accused or at least when the accused is somewhere around in the vicinity. If the accused is not present at the spot when the money is handed over to his representative, the prosecution should have at least ensured that they caught hold of the accused when the money was transferred to him by the recipient.

Honest and Committed Officer : In order to demonstrate that he has been a committed and honest Officer throughout his career, the petitioner (ADG, DRI) has made certain specific averments in his affidavit. According to the petitioner, his name was recommended by the Chief Commissioner of Customs, in the year 2007 for the award of Padmashree. His name was again recommended for presidential award on the occasion of the Republic Day in the year 2012 for specially distinguished record of service. Therefore, it is his case that he has been fixed, for stalling the enquiry initiated by him against two companies.

The High Court observed, “As held by the Supreme Court in M.NarayananNambiar , the object of the Prevention of Corruption Act, is not only to prevent corruption among the public servants, but also to prevent the harassment of the honest among them. If the petitioner is really honest, as he proclaims to be , but about which I am not competent to pronounce an opinion, the Department is duty bound to protect him from harassment. This is the only reason why I would venture to direct the Department to undertake an enquiry into his complaint.”