By TIOL News Service

NEW DELHI, OCT 19, 2016: THIS appeal is directed against judgment and order dated 29.10.2013, passed by the High Court of Judicature at Bombay in Criminal Writ Petition No. 3654 of 2012, whereby the petition challenging the sanction dated 09.10.2012 for prosecution of the appellant under Section 13 of the Prevention of Corruption Act, 1988 is dismissed.

The appellant is an officer of the Indian Revenue Service (" IRS "), who entered into the service through 1992 batch. It is stated that an FIR was registered on 04.04.2005 by Central Bureau of Investigation (CBI) in respect of disproportionate assets to the known sources of the appellant.

The prosecution case is that the appellant has amassed the assets valued at Rs.1,27,38,353 /- in his name and in the names of his wife and minor son during the check period 04.01.1993 to 31.03.2004, which is disproportionate to the known sources of his income. The investigation took almost six years to get completed, which revealed that a sum of Rs.56,30,296 /- was invested by the appellant through Benami transactions in the names of his wife and son in two companies, namely, M/s. ARJ Impex Private Limited and M/s. Malik Hospitality Services Private Limited. According to CBI, the appellant's wife Priyanka Batra incorporated a company, M/s. ARJ Impex Limited, to engage in import-export business, and then sold her shares in the company to her two uncles, namely, Karan Singh and Vijay Kumar. The company's main source of income was unsecured loans obtained from various companies and individuals, many of which were never paid back, several of these loans were from Priyanka Batra herself. Further, though the sale of income of the company was minimal, it acquired assets of Rs.85,70,770 /- during the check period. It appears that Karan Singh and Vijay Kumar had incorporated another company called M/s. Malik Hospitality Services, whose main source of income was unsecured loans from various individuals and companies. The company had acquired assets of Rs.20,52,013 /- and had unrepaid loans of Rs.26,77,000 /- during the check period. Priyanka Batra was connected to Malik Hospitality Services as a public notice appeared in Nav Bharat Times, showing her as the intended purchaser of a property that was to be bought for the company.

The appellant was arrested on 02.09.2010, and after about three days released on bail. He was placed under suspension by the authority concerned. The CBI sought sanction for prosecution of the appellant from the competent authority on which the file was processed, and at the first stage on 03.05.2011 advice of Central Vigilance Commission ( CVC ) was sought by the Finance Department. On 01.09.2011, the CVC recommended that the sanction for prosecution be granted. The department concerned (Finance Department) endorsed the matter again on 01.11.2011 for fresh opinion of the CVC . But the CVC , through its Office Memorandum dated 02.11.2011, reiterated its opinion. The Finance Department thereafter referred the matter to Department of Personnel and Training (" DOPT ") for its views. The DOPT did not appreciate the stand of the Finance Department that the sanction should be accorded only if the CBI provides sufficient evidence and communicated the same through letter dated 29.03.2012. However, it observed that administrative warning could be issued to the appellant for not intimating the transactions to Finance Department. Through letter dated 28.05.2012, the DOPT conveyed that insufficiency of evidence can be tested in the court of law and sanction for prosecution can be granted. Finally, the competent authority, vide its order dated 09.10.2012, granted sanction for prosecution of the appellant, who challenged the same before the High Court in the writ petition, which was dismissed by the impugned order.

The senior counsel appearing on behalf of the appellant, argued that there was categorical opinion of the Finance Department that the evidence laid before it was not sufficient to grant sanction for prosecution. It is pointed out that there was difference of opinion between Finance Ministry and the CVC . Not only this, even DOPT opined that warning to the officer could be sufficient. It is further submitted that the earlier competent authority (Finance Minister, Government of India) had referred the matter back to the CVC , as such, the sanction for prosecution stood declined, and grant of the sanction by the successor Finance Minister cannot be said to be a valid sanction for prosecution. It is further argued that the Rules of Business are not followed, as such, it cannot be said that the sanction was accorded by the competent authority.

The Supreme Court is of the opinion that the sanction cannot be held invalid only for the reason that in the administrative notings different authorities have opined differently before the competent authority took the decision in the matter. It is not a case where the Finance Minister was not the competent authority to grant the sanction. What is required under Section 19 of the Prevention of Corruption Act, 1988 is that for taking the cognizance of an offence, punishable under Sections 7, 10, 11, 13 and 15 of the Act committed by the public servant, is necessary by the Central Government or the State Government, as the case may be, and in the case of a public servant, who is neither employed in connection with affairs of the Union or the State, from the authority competent to remove him. Sub-section (2) of Section 19 of the Act provides that where for any reason whatsoever any doubt arises as to whether the previous sanction, as required under sub-section (1) should be given by the Central Government or the State Government or any authority, such sanction shall be given by that Government or authority which could have been competent to remove the public servant from his office at the time when the offence was alleged to have been committed.

Having gone through the copy of note-sheets relating to sanction in question placed before the Court as part of rejoinder affidavit, it is evident to the court that there had been proper application of mind on the part of the competent authority before the sanction was accorded. The Court's perusal of the said record did not indicate that any decision was taken by the competent authority, at any point of time, not to grant sanction so as to give the decision to grant sanction the colour of a review of any such earlier order, as has been contended. The opinion of CVC , which was reaffirmed and ultimately prevailed in according the sanction, cannot be said to be irrelevant for the reason that clause (g) of Section 8 of the Central Vigilance Commission Act, 2003 provides that it is one of the functions of the CVC to tender advice to the Central Government on such matters as may be referred to it by the Government.

The Supreme Court found no reason to interfere with the impugned order passed by the High Court dismissing the writ petition. Accordingly, the appeal is dismissed. The trial court is directed to conclude the trial expeditiously.

However, the Supreme Court clarified that it has not given any opinion as to the merits of the case.

(See 2016-TIOL-175-SC-SERVICE)