1. The petitioner is before this Court calling in question order dated 09-09-2020 which accords sanction for prosecution under Section 197 of the Cr.P.C. and Section 170 of the Karnataka Police Act, 1963 in Crime No.RC-14(A)/2019 for offences punishable under Sections 120B r/w Sections 420, 406, 409 of the IPC and Section 9 of the Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2004 (‘the KPID Act’ for short) and further sought quashment of supplementary charge sheet in Special C.C.No.1055 of 2019 naming the petitioner as an accused and arraigning him as accused No.26 for the aforesaid offences. He would further seek quashment of the order taking cognizance on the aforesaid supplementary charge sheet dated 06-11-2020. In all, the petitioner seeks obliteration of entire proceedings initiated against him in Special C.C.No.1055 of 2019.
2. Heard Sri Kushal Gowda, learned counsel for Sri R. Swaroop Anand, learned counsel appearing for the petitioner, Sri Mahesh Shetty, learned High Court Government Pleader appearing for respondent No.1 and Sri P.Prasanna Kumar, learned Special Public Prosecutor appearing for respondent No.2.
3. Facts, in brief, germane are as follows:-
On 12-08-2016, the Assistant Manager of Reserve Bank of India (‘RBI’ for short) communicates to the Director General and Inspector General of Police an information received by him about acceptance of deposits by “I Monetary Advisory” and RBI conducted a micro inspection by visiting the office of the Company and had obtained certain documents, which prima facie indicated that the Company is operating various schemes by collection of deposits from the public unauthorisedly. This comes to be projected as IMA. On 08-09-2016, the aforesaid communication was treated as a complaint and the same was forwarded to the concerned to be investigated into the allegations. The matter is later entrusted to the Station House Officer of Commercial Street Police Station. The Commercial Street Police conducted investigation and submitted a report on 16-11-2016, pursuant to which several crimes against several were registered and the matters were pending consideration. After all the aforesaid events, from the date of communication of the RBI, till constitution of the State Level Coordination Committee for inquiring into IMA deposits on 23-12-2016, the petitioner was nowhere in the picture. On 01-01-2017, the petitioner takes charge as Deputy Commissioner of Police, East Bangalore. On 12-01-2017, the meeting of State Level Coordination Committee took place wherein, it was resolved that the Additional Commissioner of Police be directed to revisit the case being investigated by the Commercial Street Police. Accordingly, it was directed to re-open the case at the hands of the petitioner. The petitioner then issues a police notice under Section 41A of the Cr.P.C. on 22-02-2017, against the Assistant Manager, RBI referring to his complaint and calling upon him for investigation. Investigation is conducted and the petitioner sends a report on 16-05-2017 to the Commissioner of Police, Bengaluru regarding the inquiry conducted on IMA group. The Commissioner of Police then forwards the report to the Additional Commissioner of Police on 17-05-2017. All these allegations/cases were entrusted to the CID and from the hands of the CID to the CBI. Insofar as the petitioner is concerned, the facts would run as follows:
4. An FIR comes to be registered by the CBI in No.RC0372020A0005 on 01-02-2020, for offences punishable under Sections 7, 7A, 8, 10, 11 and 12 r/w. Section 13(2) and 13(1)(d) of the Prevention of Corruption Act, 1988 and the petitioner was named as accused No.2 in the said FIR. Pursuant to registration of the crime, a communication is made by the CBI to the Competent Authority seeking sanction for prosecution as obtaining under Section 197 of the Cr.P.C. r/w. Section 170 of the Karnataka Police Act, 1963 as the offences alleged were an amalgam of both under the Prevention of Corruption Act, IPC and Section 9 of the KPID Act. The sanction was accorded. After according of sanction to prosecute the petitioner, the CBI filed a supplementary charge sheet in the crime so registered by it in RC-14(A)/2019. Here, the petitioner is arrayed as accused No.26. Therefore, the petitioner who was accused No.2 in the FIR registered by the CBI becomes accused No.26 in the supplementary charge sheet filed by the CBI.
5. One analogous development takes place in the issue. On the same set of facts and on the same allegations that had become the reason for registering the crime under Sections 7, 7A, 8, 10, 11 and 12 r/w Section 13(2) and 13(1)(d) of the Prevention of Corruption Act and the offences under the IPC, a departmental inquiry was also initiated against the petitioner. In the departmental inquiry, after conduct of a full blown inquiry, the Inquiry Officer exonerates the petitioner of the offences of demand and acceptance of any bribe concerning IMA deposits. Therefore, the petitioner is before this Court seeking quashment of the genesis of the issue till the present stage, on the score that he has been completely exonerated in a departmental inquiry.
6. The learned counsel appearing for the petitioner would vehemently contend that on the same set of facts that triggered registration of crime by the CBI and drawing up the petitioner as accused No.26 in the supplementary charge sheet, a departmental inquiry was also conducted. All the witnesses who are cited in the supplemental charge sheet to be tried against the petitioner have all tendered evidence in the departmental inquiry, which culminated in non-imposition of any penalty. Therefore, he would contend that it being on the same set of facts, the criminal proceedings should not be permitted to be continued. He would seek to place reliance upon several judgments both of the Apex Court and this Court, reference to which would be made during the course of the order.
7. On the other hand, the Special Public Prosecutor appearing for the 2nd respondent though would put up vehement defence against any order being passed in favour of the petitioner contending that it is a matter of trial for the petitioner to come out clean, would admit that a departmental inquiry was in fact conducted on the very same set of facts and the evidence of witnesses and the documents are very same that are in the criminal trial. But, his submission is that, all by itself would not enure to the benefit of the petitioner to seek obliteration of entire proceedings. He would submit that the petitioner should be directed to face trial and come out clean in the said trial. He would seek dismissal of the petition.
8. I have given my anxious consideration to the submissions made by the respective learned counsel and have perused the material concerned on record.
9. The petitioner assuming charge of the post of Deputy Commissioner of Police, East Bangalore on 01-01-2017, is a matter of record. The petitioner is alleged to have demanded and accepted bribe and, therefore, after registering the FIR against him, investigation is conducted and he has been arrayed as accused No.26 in the supplemental charge sheet filed before the concerned Court by the CBI and the proceedings are pending before the concerned Court. As observed hereinabove, the petitioner is arrayed as accused No.26 in Special C.C.No.1055 of 2019. Based upon the contents and allegations in the charge sheet, which arrayed the petitioner as accused No.26, a departmental inquiry was sought to be initiated against the petitioner. A show cause notice was issued initially on 30-01-2021 directing the petitioner to submit his reply. The petitioner submits his defence statement. Not being satisfied with the defence statement, a charge sheet was issued for conduct of a regular departmental inquiry along with list of witnesses to be examined during the inquiry and documents. A detailed inquiry was conducted by the Inquiry Officer and submitted his report on 23-05-2022. The inquiry was conducted under the All India Services (Discipline and Appeal) Rules, 1969 as the petitioner was an officer belonging to the Indian Police Service. The Inquiry Officer submitted his report holding that the allegations against the petitioner were partly proved. The report of the Inquiry officer insofar as it is germane reads as follows:
“…. …. ….
The submission of the Presenting officer that the complainant appeared before the charged officer only after receiving the reminder dated 26.04.2017 does not appear to be based on record. Shri Krishna Deshpande, in his statement clearly stated that has required by the notice dated 22.02 2017, he appeared before the Charged officer on 23.02.20217(sic) wherein the charged officer mentioned the purpose of asking him to appear and wanted him to tell any information and documents in support of the complaint he had forwarded. He stated that he also informed the Charged officer that all the documents had had (sic) collected in his office and he did not have any documents with him. He further stated that he doesnot admit the assertion the notice dated 26.04.2017 that he fail to appear before the DCP in response to the notice dated 22.02.2017. The CO did not even contest this Submission by Shri Krishna Deshpande. Therefore, the submission of the presenting officer that Shri Krishna Deshpande appeared only after the reminder was issued seems out of place.
Therefore, the allegations that the CO delayed the report acquires strength on the face of absolutely nil contribution by the so called enquiry conducted by the CO. The report of CO dated 16-05-2017 addressed to the Commissioner of Police, Bengaluru city available as document-XI in the reply of the CO the show cause notice vide letter dated 29-03-2021 discloses nothing about the contribution of enquiry conducted by him. From the perusal of the records, however, it is not established that he obtained the second report from the Commercial Street Police Station to favour the IMA. The second report dated 12.05.2017 from the Police Inspector merely forwarded certain follow on documents submitted by the Chartered Accountant of IMA and there was no specific view or report included in that letter. Therefore, this letter of 12.05.2017 is of no consequence for the purpose of charge.
This analysis discloses the delay and perfunctory conduct of the enquiry due to negligence in conducting the enquiry on part of the CO. When the CO had the opportunity to examine the report of the PI before forwarding it to the Higher Officers, he also failed in recognizing the weakness in the report of the PI and guiding the PI to address those weakness. Therefore, my finding is that the Charge-1 is partially proved.
As regards the remaining charges namely: Change-2, 3, 4, 5 and 6 I concur with the conclusions drawn by the Presenting Officer in his written brief that the material brought on record through the documents examined and the statements of the witnesses examined does not substantiate any of these five charges framed against the Charged Office, Shri Ajay Hilori, IPS. I therefore hold that the Charge Nos. 2,3,4,5 and 6 are not proved.
Before parting with this report, I would like to draw the attention of the Government to the conduct of CBI officers, as narrated in paras 34 to 42 of this report. It is strange that the Chief investigating officer of the premier investigating agency, after investigating a sensational case, fails to give his evidence, thus frustrating the enquiry. Even the rest made to the Director CBI to direct the Chief Investigating Officer to appear for giving evidence proved futile.”
The Inquiry Officer was of the view that the petitioner was negligent in not considering the report of the Police Inspector, but, merely forwarded the report along with certain documents. He ought to have looked into those documents and then forwarded it, was the only substance in the allegation. All other charges of acceptance of bribe or otherwise, were all held to be not proved. Therefore, he was only charged with negligence. Based upon the aforesaid report, a second show cause notice was issued to the petitioner on 07-06-2022, enclosing the report of the Inquiry Officer. The notice reads as follows:
“From:
The Chief Secretary to Government. Government of Karnataka,
Vidhana Soudha Bengaluru – 01., To:
Sri. Ajay Hilori, IPS SP & Commandant,
1st Battalion, Karnataka State Reserve Police Kormangala, Bengaluru.
Sir,
NOTICE UNDER RULE 9(2) OF ALL INDIA SERVICES (DISCIPLINE & APPEALS) RULES, 1969
*****
With respect to the charges made against you, Srr Ajay Hilori, IPS (KN-2008) with regard to IMA case, the Government had appointed Sri G.V.Krishan Rau, IAS (Retd.,) as Enquiry Officer and Dr. Subramanyeswar Rao, IPS as Presenting Officer vide Government Order dated 23.08.2021 and 27.09.2021.
The Enquiry Officer has submitted the Enquiry Report to the Government on dated:23.05.2022 and has decided and reported that the charge-1 is partially proved and me charges 2 to 6 are not proved. The Copy of the Enquiry Report is enclosed herewith.
You are directed to submit your written statement with regard to Enquiry Report within a period of 15 (Fifteen) days from the date of receipt of this notice. Failing which further action will be taken in accordance with the All India Services (Discipline and Appeal) Rules, 1969.
By order and in the name of the Government of Karnataka
Sd/- (Nagappa S.Pareet)
Under Secretary to Government Department of Personnel and Administrative Reforms (Services-4)”
The petitioner submits his detailed reply on the charge that was held to be proved i.e., negligence. No order was passed by the Disciplinary Authority on the report of the Inquiry Officer after submission of the reply by the petitioner. But, the Disciplinary Authority chose to conduct a de novo inquiry by appointing a different Inquiry Officer. The petitioner then challenges the said order dated 17.11.2022 before the Central Administrative Tribunal, Bangalore Bench by filing Original Application No.170/00503/2022. The Central Administrative Tribunal in terms of its order dated 14- 02-2023, allows the Original Application, following the judgments of the Apex Court on the issue and holds that the de novo inquiry to be conducted by a different Inquiry Officer was contrary to law and sets the order dated 17-11-2022 aside. Pursuant to the order of the Central Administrative Tribunal, the entire proceeding is closed against the petitioner by issuing a warning. The order dated 15-06-2023 by which the petitioner was issued an administrative warning. The order reads as follows:
“PROCEEDINGS OF GOVERNMENT OF KARNATAKA
Subject: Closing of Department Enquiry Proceedings against Sri.Ajay Hilori, IPS (KN - 2008)- Reg.
Read:
1. Government Order No. HD 8 PCR 2019 dated: 19.08.2019.
2. Letter No. MBIT-IMA/CBI/BLR/2019/64, dated: 18.12.2019 of Superintendent of Chief Investigating officer, MDIT, CBI, Bengaluru.
3. U.O Note No.HD 212 Posipa 2019 (P1), dated: 16.01.2021
4. Notice under rule 8(4) of AIS (Discipline & Appeals) Rules, 1969 No: DPAR 09 SPS 2021, dated: 30.01.2021.
5. Letter of Sri. Ajay Hilori, IPS dated: 04 02.2021.
6. Letter of Government of Karnataka No. DPAR 09 SPS 2021, dated:02.03.2021.
7. Reply of Sri. Ajay Hilori, IPS dated:29.03.2021.
8. Government Order No: DPAR 09 SPS 2021, dated: 23.08.2021 and 27.09.2021.
9. Letter of Sri GV Krishna Rau, IAS (Retd.,) dated: 23.05.2022.
10. Notice Under Rule 9(2) AIS (D&A) Rules dated: 07.06.2022.
11. Reply of the officer dated: 16.06.2022 to Notice under rule 9(2).
12. Government Order No: DPAR 09 SPS 2021, dated: 17.11.2022.
Preamble:
In the Government Order read at reference (1) above, State of Karnataka has entrusted the investigation of financial irregularities of the I-Monetary Advisory (IMA), Bengaluru and its group entities to Central Bureau of Investigation.
Central Bureau of Investigation after carrying out the investigation in the case of M/s Monetary Advisory Private Limited & its group entitles and has submitted its report vide letter read at reference (2) above and recommended RDA for major penalty against Sri.Ajay Hilori, IPS (KN 2008) the then Deputy Commissioner of Police (east), Bengaluru.
Departmental Enquiry was initiated against Sri Ajay Hilori, IPS (KN 2008) by serving Show Cause Notice along with Articles of Charges under the provisions of rule 8(4) of AIS (Discipline & Appeals) Rules, 1969. After examining the reply of the officer at (7) the Government under the provisions of Rule 8(6)(a) of the All India Services (Discipline & Appeal) Rules, 1969 Sri. G V Krishna Rau, Retd., IAS officer as Enquiry Officer to enquire in to the charges levelled against Sri. Ajay Hilori, IPS and appointed Dr.A Subramaneshwar Rao, IPS (KN 2002) as the Presenting Officer to present the case on behalf of the Government vide GO read at (8).
The enquiry officer submitted the enquiry report to the Government vide letter read at (9). A second show cause notice under rule 9(2) of AIS (D&A) Rule was issued to the charged officer read at (10). The officer in his reply dated: 16.06.2022 read at (11) has stated that the report of the IO on charge-1 is untenable and agreed to the IOs report on charges 2 to 6 as they are not proved in the report of IO.
However, Government rejected the enquiry report and appointed a retired District and Sessions Judge for fresh enquiry vide GO read at (12). The charged officer however, challenged the order of fresh enquiry in the Central Administrative Tribunal, Bengaluru Bench vide O.A No:503/2022. The Hon’ble Tribunal vide its order dated: 14.02.2023 set aside the Government order dated:17.11.2022 read at (12) and directed the Government to consider the reply of the charged officer dated: 16.06.2022 and take appropriate decision in the matter. In view of the Hon’ble CAT order dated: 14.02.2023 the reply of the officer dated:16.06.2022 is examined and the Government have decided to close the proceedings against the officer with a warning. Hence, the following order
GOVERNMENT ORDER NO. DPAR 09 SPS 2021, BENGALURU, DATED: 15.06.2023
In the circumstances explained in the preamble, the Departmental Enquiry Proceedings initiated against Sri. Ajay Hilori, IPS (KN 2008) under rule 8(4) of AIS (D&A) rules is hereby closed with a warning.
BY ORDER AND IN THE NAME OF GOVERNOR OF KARNATAKA
Sd/- 15/6 (Nagappa S Pareet)
Under Secretary to Government. Department of Personnel and Administrative Reforms (Services-IV).”
(Emphasis added)
The warning is not even a penalty. Therefore, it can be construed that the departmental inquiry against the petitioner has ended with its closure without imposing any penalty against him as warning is not one of those enumerated penalties under the AIS (Discipline and Appeal) Rules, 1969.
10. The issue now is, if nothing could be proved in a departmental inquiry where probabilities are preponderant on the charge of negligible; negligence as is found in the report of the Inquiry Officer, whether criminal proceedings should be permitted to be continued, where allegations against the petitioner will have to be proved beyond all reasonable doubt, so to say, in the teeth of the aforesaid, the departmental inquiry ending by issuing only an administrative warning can it lead to closure of proceedings before the criminal Court. For consideration of this issue, it is germane to notice the witnesses who were examined in the inquiry and the report of the Inquiry Officer on those issues. It is therefore tabulated:
| “Sl NO | Allegation Against the Petitioner (A26) in the Supplementary Chargesheet of Spl.CC. | Correspondent charge in the Article of Charge of Departmental Enquiry bearing no, NO.DPAR 09 SPS 2021 against the Petitioner | Finding Given by the Enquiry Officer with respect to the said charge vide report dt:23.05.2022 |
| 1. | “10. That Shri Krishna Deshpandey, the then Assistant Manager, Market Intelligence Unit of Reserve Bank of India (RBI), Regional Office, Bengaluru had conducted market intelligence study/survey in respect of the activities of M/s. 1-Monetary Advisory (IMA) and its group of entities specifically with respect to the mode of collecting/acceptin g deposits by these entities from the general public. It was reported that the IMA and its group of entities were collecting deposits from public unauthorizedly in violation of regulatory norms and the report dated 12.08.2016 was forwarded to the office of DG and IGP, Karnataka State for taking necessary action against IMA. The said report and references of RBI were forwarded to the Commercial Street Police Station by the office of DG and IGP through the office of Deputy Commissioner of Police (East). The report was received by Shri Ajay Hilori, IPS (A26), the then DCP (East) and forwarded the same to the police station and on 29.08.2016 Shri M.Ramesh (A-27), inspector of Police & SHO of Commercial Street PS received the report on 29.08.2016. Shri M.Ramesh (A-27) without examining Shri Krishna Deshpande and without verifying the facts disclosed in the report of Shri Krishna Deshpande, closed the compliant/referenc e received from RBI and submitted a report to the Asst. Commissioner Police (ACP), Pulakeshi Nagar on 19.11.2016 and as per the instructions of ACP, he had also sent an endorsement to complainant on 16.12.2016 and forwarded it to ACP Pulakeshi Nagar on 19.12.2016. The said report and endorsement of Shri M.Ramesh (A27) were forwarded to Shri Ajay Hilori, IPS (A26), the then DCP (East) by ACP Pulakeshi Nagar on 12.01.2017 In the report and endorsement of Shri M.Ramesh (A27), it was stated that no complaint was received by the police station against M/s IMA Private Limited and also mentioned that the IMA was running as per rules, even though the Market Survey Report of RBI disclosed unauthorized activities of IMA and its group entities with respect to collecting/acceptin g deposits from the general public. 11. That the above referred verification report submitted by Shri M.Ramesh (A-27) was received at the office of DCP (East) on 12.01.2017 through the O/o. ACP Pulakeshi Nagar. However, Shri Ajay Hilori, IPS (A-26), the then DCP (East), Bengaluru did not take any action on this report submitted by Shri M.Ramesh (A-27) for long, but again he obtained another report dated 12.05.2017 with similar content from Shri M.Ramesh (A-27). Police Inspector, Commercial Street Police Station. Meanwhile, Shri Ajay Hilori, IPS (26) summoned Shri Krishna Deshpandey of RBI who had conducted the market intelligence survey for examination, but he did not record Shri Krishna Deshpandey’s statement. Shri Ajay Hilori IPS (A26) had formally obtained an attendance report from Shri Krishna Deshpandey stating that he had attended the enquiry on 27.04.2017. Shri Ajay Hilori , IPS (A-26) forwarded the report of Shri. M.Ramesh (A-27) dated 12.05.2017 to the Addl. Commissioner of Police (Crime), Bengaluru City Police on 16.05.2017, in which it was mentioned that the IMA and its group entities were functioning as per the rules and no complaints were received against hese entities from any person and as such no action was required taken against IMA and falsely mentioning that Shri Krishna Deshpandey was examined by enclosing the said attendance report in order to justify his delay in acting on the report dated 19.11.2016 submitted by Shri M Ramesh (27). This report of Shri Ajay Hilori, IPS (A26), the then Deputy Commissioner of Police. Bengaluru (East) was forwarded to the RBI by the office of Addl. Commissioner of Police (Crime), Bengaluru City Police. It was disclosed that Shri Ajay Hilori, IPS (A26) caused undue delay in forwarding the report against IMA submitted by his subordinate to shield IMA from facing any action from the Regulators or Government. He intentionally withheld the first report of Shri M.Ramesh (A-27) as he was reluctant to take proper action against IMA. 12. That the General Manager, RBI wrote a letter to the Commissioner of Police, Bengaluru City Police on 17.09.2017 regarding verification in respect of IMA. In this letter the GM, RBI had referred the report of Shri. Ajay Hilori, IPS (A26), the then DCP (East), Bengaluru dated 16.05.2017 and requested to take further steps. Shri Ajay Hilori, IPS (A-26) vide his letter No.596/CRM/DCP( E)/2016 dated 10.10.2018 addressed to the Commissioner of Police, Bengaluru City stating that “the enquiry was conducted upon the observations made by the State Level Coordination Committee in its meeting held on September 14, 2017 against Monetary Advisory Bangalore. As Communicated by the General Manager, Reserve Bank of India. Thus, matter being investigated by the office of the CID (Crime), Bengaluru. Hence the petition can be closed and be referred to the office of CID (Crime), Bengaluru.”This letter with its contents clearly established that the matter pertaining to IMA was pending with Sri. Ajay Hilori, IPS (A-26), the then DCP (East), Benglauru City, since September 14, 2017 and no action was taken in this matter for more than a vear. Finally, the reference was closed on 10.10.2018 simply by citing a reference received from General Manager, RBI regarding documents forwarded to CID. Shri Ajay Hilori, IPS (A-26) closed the matter just before he was demitting the office of DCP (East). Bengaluru on transfer by simply mentioning that the matter was already been dealt by CID , with a malafide intention to not to initiate proper timely action against IMA and Shri Mohammed Mansoor Khan (A1) 10-12 at page no. 247 to 250 of the Petition) |
Charge No.1. 1.On 12.08.2016, in a letter to the DG and IGP, the RBI had stated that they had conducted a Market Intelligence visit to the office of the IMA Group of Entities and obtained certain documents/informat ion regarding their activities which prima facie indicated that the IMA was operating various schemes for collection of deposits from public in an unauthorized manner. This letter was also endorsed to the Commissioner of Police, Bangalore City. The Commissioner of Police directed you to conduct an enquiry and to submit a report. The said letter reached Commercial Street Police Station on 28.08.2016. Shri M.Ramesh, Police Inspector and Station House Officer of Commercial Street Police Station conducted an enquiry and submitted the report that no complaint was received against M/s IMA Private Limited, and the company was running as per rule and forwarded the report to ACP, Pulakeshinagr on 19.11.2016. Further, as per the directions of ACP Pulakeshi Nagar, PI Shri Ramesh sent an endorsement to the complainant on 16.12.2016 and forwarded the report to ACP Pulakeshi Nagar on 19.12.2016 who forwarded the same to you on 12.01.2017. However, you did not take any action on the said report till 16.05.2017. Instead, you c another I dated 12.05.2017 from Sri. M.Ramesh, PI and forwarded the report same to the Addl. Commissioner of Police (Crime) on 16.05.2017. This shows that you purposely delayed and obtained another report from the Police Inspector, Commercial Street Police Station to favour IMA. Charge 3. Though the result of the enquiry was not accepted by the RBI and the DG and IGP issued instructions to relook into the matter, the Commercial Street Officers under your guidance resisted to conduct any enquiry and stood-by their earlier stand. Thus, you and your officers of Commercial Street Police Station were able to protect the interest of Mohammad Mansoor Khan and the IMA. You and your officers of Commercial Street Police Station were illegally benefited by accepting gratification from Mohammed Mansoor Khan/IMA as a motive/reward for submitting a favourable enquiry report and for not initiating any action despite receiving written complaints from the public and also receiving references from RBI and other authorities. |
Findings Charge 1. The operative parts of the first charge elaborated in Para II (i) are as follows: 1. Despite specific instructions for conducting an enquiry, you forwarded the letter to the Police Inspector, Commercial Street Police Station for enquiry. 2. On completion of enquiry by the Police Station, you did not take any action on the said perfunctory enquiry report till instead, you obtained another report dated 12.05.2017 from Sri. M.Ramesh, PI and forwarded the same to the Addl. Commissioner of Police (Crime) on 16.05.2017. this shows that you purposely delayed and obtained another report from the Police Inspector, Commercial Street Police Station to favor IMA. On examining the evidence collected during the present enquiry, it appears there is a mix up of the events in framing of the charges against the CO. While the initial enquiry and report in question, by the Commercial Street Police Station on the complaint of the RBI happened between September 2016 and December 2016. the then DCP East Division was Shri. Satish N.Kumar, IPS and the CO assumed Charge as DCP East Division only in January 2017. Needless to mention, he cannot be held acountable for decisions taken during that period. The second part of the charge refers to an enquiry taken up by the CO in February 2017 based on the report submitted by the PI Commercial Street PS through ACP, Pulakeshinagar Sub-Division. Accordingly, it is seen that, the then DCP East Division (CO) issued a notice (Ex-P3) to the Petitioner Sri. Krishna Deshpande (PW- 1) to furnish additional information in support of the allegations made in his complaint. It is seen that this notice was received at the RBI office on the same date. Further, the minutes of 15” SLCC SG meeting dated:28-03- 2017 (Ex-D1) shows that the City Police shared with the petitioner the relevant documents collected from the M/s. IMA group of companies and was requested to revert on the same after going through the documents. However, until the next reminder notice was issued to the petitioner on 26.04.2017 (ExP4), there are no records to show the petitioner reverted to the DCP East Division (CO). it was only in response to the above reminder notice that the petitioner appeared before the 0/0 DCP East Division on 28.04.2017 and recorded his response (ExP5). Based on the report of PL commercial Street PS, documents collected and further statement of the petitioner, the CO forwarded his report to the Commissioner of Police, Bengaluru City for further necessary action on 16.05.2017. From the above it may be seen that the enquiry undertaken by the CO to seek further clarification on the report of his sub-ordinate, the PI Commercial Street PS, was conducted between 22.02.2017 to 16.05.2017. During this period two notices were issued to the petitioner seeking further details on the allegations made in the complaint to which the petitioner responded only on 28.04.2017, after which the enquiry was concluded in the next 18 days and report forwarded to the Commissioner of Police on 16.05.2017. Except for the enquiry conducted over a period of 4 months and report forwarded to senior officers for further necessary action, there is nothing on record to say that the CO “purposefully” delayed a report and obtained another report from the Police Inspector, Commercial Street Police Station to favour IMA. The delay in the above enquiry as borne on records appears to be due to the delayed response of the RBI is furnishing documents as sought by the CO. Further, it is not even clear as to which report is being referred to, while alleging ‘obtained another report from the Police Inspector, Commercial Street Police Station to favor IMA: (Please refer para 47, finding on Charge 1 at Page no. 97- 98 of the present memo) Findings on Charge 3. Enquiry has not brought out any records that point towards the charge that, RBI did not accept the report of the Commercial Street Police Station or the DCP East Division and that DG & IGP asked the Police to relook into the matter or that the Police Station under supervision of the CO, resisted enquiry or took a stand that “IMA and its various entities were not indulging in activities in contravention of KPID Act” As no witnesses or documents pertaining to this charge could be made out, it was only the Chief IO of CBI who could have clarified further. But as the officer failed to appear, this charge remains not proven. The second part of the above charge refers to alleged acceptance of illegal gratification by the CO, as a quid-pro-quo to protect the promoter of M/s IMA Shri. Mohammed Mansoor Khan, which is dealt with specifically in the following paras. |
| 2. | 16. That on 25.06.2018, on the approval of the then Principal Secretary, Revenue Department, the Deputy Secretary (Revenue) addressed a letter to the Deputy Commissioner. Bengaluru Urban asking him to pass instructions to concerned Tahsildar to lodge a police complaint against IMA group of entities for taking action against the IMA under KPIDFE Act, 2004. On the instructions of his senior officers, Shri K Babu, the then Revenue Inspector of Shivaji Nagar area visited IMA Jewellery premises in Shivaji Nagar on 10.08.2018 and enquired with the Manager of the IMA Jewellery shop to ascertain the jurisdictional police station and he came to know that the location of IMA premises falls under Commercial Street Police Station territorial jurisdiction During the conversation, the Manager of the IMA jewellery shop obtained his mobile number for his reference, on the next day of his visit to IMA office, Shri K Babu, the Revenue Inspector received a call from Shri P. Gowri Shankar (A- 28). Sub Inspector of Police, Commercial Street Police Station and enquired about the purpose of his visit to the IMA jewellery shop and on explaining the purpose, Shri P Gowri Shankar (A. 28) had asked Shri K Babu to visit the Police Station. Accordingly, Shri K Babu visited the Police Station on 13.08.2018 with a written complaint against IMA signed by Shri Prasanna Kumar, Dy: Tehsildar, Yelahanka. The complaint was received by Shri M Ramesh (A27). PI and informed to Shri K. Babu, Revenue Inspector that only Tahsildar can lodge a complaint. Further, he said that police do not have jurisdiction to investigate the offences under Section 3 of KPIDFE Act. 2004 and closed the complaint without examining the complainant despite clear guidelines were issued from Chief Secretary of Government of Karnataka through Commissioner of Police, Bengaluru City for taking necessary action under KPIDFE Act, 2004. This refusal of registering First Information Report on the complaint lodged by Deputy Tahsildar u/s 3 of KPIDEE Act.2004 by Commercial Street Police Station was against the of spirit of KPIDFE Act, 2004 under which the Government is empowered to initiate action against any company which is suspected of operating Ponzi schemes even without complaint from any investor/depositor. |
Charge No. 2 Sri. M. Ramesh, PI and Sri. Gowrishankar, PSI of Commercial T Street Police Station attended the complaint given by Sri. Prasanna Kumar, Deputy Tahsildar in consultation with you. The complaint was subsequently closed citing a legal opinion obtained from Shri Bhaskar; Legal Officer (Junior) who opined that Police cannot investigate the offence under Sec. 3 of KPI) Act 2004. During CBI examination, Shri Bhaskar clarified that U/s 3 of KPID Act 2004, the police cannot investigate directly. However, u/s 4 of KPID Act 2004 the police can investigate after obtaining authorization from the designated competent Authority: You wilfully failed to guide the PI and PSI Commercial Street Police Station properly when they com consulted you, resulting in the closure of the complaint and showing undue favours to the co accused. Further the complaint lodged on the direction from Principal Secretary (Revenue), Govt. of Karnataka was also closed by Shri. M. Ramesh PI and Sri. Gowrishankar PSI without examining the complainant despite clear guidelines from Chief Secretary, Govt. of Karnataka through the Commissioner of Police, Bengaluru for taking necessary action under KPID Act. Further, even before obtaining opinion from the Legal Officer, Sri. M.Ramesh expressed his unwillingness to investigate the complaint against the IMA citing that under KPID Act the Police cannot register a case. You refused to get FIR registered on the Complaint lodged by Deputy Tahsildar U/s 3 of KPID Act 2004 even though the Government had empowered to initiate action against any company which is suspected of operating ponzi schemes even without complaint from any investor. "It shows that you deliberately failed to guide your subordinate in the proper implementation of the KPID Act and also failed in giving a factual report to your superior officers on the fraud being committed by IMA. Though RBI conducted market survey and found that the IMA was collecting deposit from common public without registering themselves as NBFC and sufficient. |
Findings Charge No. 2 The above charge refers to two complaints filed before the Commercial Street Police Station, one on 03-08-2018 by the Sri. Prasanna Kumar, the then Deputy Tahsildar of Yelahanka and another on 04- 09-2018 by Sri B.R.Manjunath the then Tahsildar, Yelahanka Taluk, upon an RBI reference to the Government of Karnataka. The allegation in the above charge is that the CO who was the then DCP East Division under whose jurisdiction falls the Commercial Street Police Station, was aware of these complaints and that he failed to supervise his subordinate officers complaints who closed the complaints albeit after obtaining legal opinion. On examination of the witnesses and the records available the following points emerge There are no records or statements to show that the DCP East was consulted by his subordinates or passed orders to his subordinates causing the decisions made at the Police Station. Moreover, the DCP is the second level of supervision after the jurisdictional ACP and he further reports to his seniors such as the Additional Commissioner of Police and the Commissioner of Police. The Charge however appears to single out the DCP to have been responsible for the decisions taken at the Police Station without specific evidence to support the same. Further, the decision of the Police Inspector (PI), Commercial Street Police Station to. issue endorsements refusing Investigation also does not appear malafide in the light of necessary Legal Opinions sought from the Law Officer. However, it may be pertinent to note here, that the CBI Part Investigation Officer Shri. A Lazarus is still of the opinion during this enquiry, that the Local Police had powers to investigate offences under the KPID Act of 2004. The allegation that the outgoing PI Shri. Ramesh told the new incumbent Shri. Nagaraj to sign a report saying that the DCP was aware of the matter is also not borne out in the enquiry. |
| 3. |
3. 18. That Shri Ajay Hilori, IPS (A26) had accepted undue advantage in the form of valuable things from Shri Mohammed Mansoor Khan (A1) through Shri Nizamuddin.A (A2), an associate of Shri Mohammed Mansoor Khan (A1) as a reward for the favours he extended to the IMA. Shri Ajay Hilori, IPS (A-26) as DCP (East), Bengaluru City used to demand and accept bribes regularly from Shri Mohammed Mansoor Khan (A1). Further, Shri Mohamed Mansoor Khan (A-1) paid regular bribes to Commercial Street police Station SHO, Shri M Ramesh (A-22) and Shri Gowri Shankar (A-28), Sub Inspector of Police for not acting against the IMA. These police officials were illegally enriched themselves through from Shri Mohammed Mansoor Khan (A1)/IMA for not initiating any action against IMA despite receiving written complaints from the public, RBI and other authorities. 19. That Shri Ajay Hilori, IPS (A-26). Shri M.Ramesh (A27) and Shri Gowri Shankar (A-28) conspired together with Mohammed Mansoor Khan (A-1) and other directors of IMA and in pursuance of the said conspiracy, they did not take any action against the IMA and group entities despite receiving petitions and complaints from Reserve Bank complaints from of India, Shri M.S.Khanapuri and also from Revenue Officials thereby cheating the innocent investors. Though, specific complaints against IMA were received by these police officers, they with criminal intention had wilfully acted in favour of IMA and refused to take any action against IMA and closed all such complaints by furnishing false reports to the higher authorities. |
Charge 4 You demanded and accepted three imported furniture from Shri Mohammed Mansoor Khan for which the payment was made by IMA. After receiving the payment from IMA, Shri Riyaz Arif imported the furniture from China and supplied to your residence at Flat No. A-3, Chandana Apartment, Infantry Road, Bangalore which was taken on lease in the name of your wife Dr. Honey Kumar and staying there since 2016. Charge 5 You had demanded Mohammed Mansoor Khan for arranging some household articles i.e. interior decorative items for your house as a motive or reward for not sending negative report. Charge 6 You had demanded and accepted illegal gratification of more than Rs. 35 crores on various occasions from Mohammed Mansoor Khan, as a motive or reward for refraining to do an official act of taking action against the IMA. |
Findings Charge No. 4 Examination of the witnesses. and connected documents shows that, Shri. Riyaz Arif the proprietor of M/s Kreative Ideas supplied various items as indented by M/s IMA on regular basis. However, it is nowhere seen in the statements of the witnesses or in the documents that the said items were ever delivered to the residence of the CO. Neither do the statements or documents, bring out the element of demand or the acceptance. There are no records to show if the CBI searched the premises where the furniture is being alleged to be delivered or even recovered the furniture from the alleged location. Findings Charge No. 5 Examination of the witnesses and connected documents shows that Shri Raghavendra Arya proprietor of M/s Square Modules, undertook various interior works and supplied furniture as and when indented by M/s IMA on regular basis. However, it is nowhere seen in the statements of the witnesses or in the documents that the said items were ever delivered to the residence of the CO. Neither do the statements and documents bring out out the element of demand or the acceptance. There are records to show if the CBI searched the premises where the furniture is being alleged to be delivered or even recovered the furniture from the alleged location. Findings Charge No. 6 Enquiry reveals that CBI had investigated into an allegation that the CO, received a bribe of 1 Crore per month from the promotor of M/s IMA Group of Companies from July 2017 to August 2018 along with payments for purchase of Gold and Jewellery. The part IO of CBI Shri. A Lazarus who appeared for the enquiry stated that, CBI did not find any evidence to establish this allegation and hence dropped it from the Charge Sheet submitted to the court. It is not clear however, as to how and on what basis CBI stated this charge against the CO of demanding and accepting illegal gratification to the tune of Rs. 35 Crore. Neither has the CBI cited any witnesses or documents to establish these allegations. |
The first column relates to allegation against the petitioner/ accused No.26 in the supplementary charge sheet; the second column is the corresponding charge in the Article of Charges in the departmental inquiry and the third column is the finding rendered by the Inquiry Officer on the said charge in the report dated 23-05- 2022. The charges are verbatim similar. The witnesses who were examined in the departmental inquiry are the same who are sought to be examined as witnesses in the criminal trial including the Investigating Officer. The role of the petitioner in the entire charges was thoroughly scrutinized on the basis of evidence by the Inquiry Officer in his detailed report, where he holds that the petitioner is only negligent and that negligence is only in forwarding the report without looking into the report. All other allegations including demand and acceptance of bribe are all held in favour of the petitioner as the Investigating Officer himself refused to support the allegations against the petitioner. If that be so, it would not be worthy of directing the petitioner to undergo the rigmarole of trial, as undoubtedly, the petitioner would get acquitted of all the allegations so made against him, in the light of the very witnesses in the criminal trial including the Investigating Officer not supporting the case of prosecution qua the petitioner. In these circumstances whether the criminal proceedings should end in its closure is what is required to be considered.
11. The issue need not detain this Court for long or delve deep into the matter as the Apex Court has considered identical circumstances that when on preponderance of probability nothing can be proved against an accused, it can hardly be proved in a criminal trial, where it is to be proved beyond all reasonable doubt. I deem it appropriate to notice those judgments rendered by the Apex Court, which are followed by this Court in the case of Mr.A.L.JAYARAMU VS. STATE OF KARNATAKA (2021) 6 Kant L J 308. This Court in MR.A.L.JAYARAMU, has held as follows:
“13. This view of mine in this regard, is fortified by the judgment of the Apex Court in the case of P.S.Rajyav. State Of Bihar [(1996) 9 SCC 1], wherein the Apex Court has held as follows:-
“17. At the outset we may point out that the learned counsel for the respondent could not but accept the position that the standard of proof required to establish the guilt in a criminal case is far higher than the standard of proof required to establish the guilt in the departmental proceedings. He also accepted that in the present case, the charge in the departmental proceedings and in the criminal proceedings is one and the same. He did not dispute the findings rendered in the departmental proceedings and the ultimate result of it. On these premises, if we proceed further then there is no difficulty in accepting the case of the appellant. For if the charge which is identical could not be established in a departmental proceedings and in view of the admitted discrepancies in the reports submitted by the valuers one wonders what is there further to proceed against the appellant in criminal proceedings. In this context, we can usefully extract certain relevant portions from the report of the Central Vigilance Commission on this aspect.
“Neither the prosecution nor the defence has produced the author of various reports to confirm the valuation. The documents cited in the list of documents is a report signed by two engineers namely S/Shri S.N. Jha and D.N. Mukherjee whereas the document brought on record (Ex. S-20) has been signed by three engineers. There is also difference in the estimated value of the property in the statement of imputation and the report. The document at Ex. S-20 has been signed by three engineers and the property has been valued at Rs 4,85,000 for the ground floor and Rs 2,55,600 for the second floor. A total of this comes to Rs 7,40,900 which is totally different from the figure of Rs 7,69,800 indicated in the statement of imputation. None of the engineers who prepared the valuation report though cited as prosecution witnesses appeared during the course of enquiry. This supports the defence argument that the authenticity of this document is in serious doubts. It is a fact that the income tax authorities got this property evaluated by S/Shri S.N. Jha and Vasudev and as per this report at pp. 50 to 63 they estimated the property at Rs 4,57,600 including the cost of land Rs 1,82,000 for ground and mezzanine floor plus Rs 2,55,600 for first floor and Rs 20,000 for cost of land. Thus both the engineers who prepared the valuation report for income tax purposes also prepared the report for the CBI and there is no indication in the subsequent report as to why there is a difference in the value of the property. A perusal of these two reports reveals that there is difference in the specification of the work. The valuation report prepared by Shri S.N. Jha for ground floor for income tax purposes clearly states that the structure was having “RCC pillars at places, brickwork in cement mortar, RCC lintel, 60 cm walls, 9 inch floor height, 17.6, 8.00, 8.00 inch” but in the report for CBI which was also prepared by him the description is “RCC framed structure open verandah on three sides in the ground floor”. Similarly, for the first floor it is written in the report as “partly framed structure and partly load being walls, floor heights 3.20 mm. Further Shri S.N. Jha on p. 54 of Ex. D-1 had adopted a rate of Rs 290 per sq. mtr. for ground floor and adding for extra height he had estimated ground floor including mezzanine floor at Rs 2,02,600. But for the report at Ex. S-20 the rate has been raised to 365 per sq. mtr. There is no explanation for this increase of rate by Rs 75 per mtr. It is also observed that for the updating of the cost of index 5% was added to the rate of Rs 290 as per p. 55 of Ex. D-1 by Shri S.N. Jha but this has been raised to 97% as an escalation to the cost of index in Ex. S-20 without explaining or giving the reasons therefor. It is surprising that same set of engineers have adopted different standard for evaluating the same property at different occasions. Obviously, either of the report is false and it was for the prosecution to suitably explain it.
In the absence of it the only inference to be drawn is that report at Ex. S-20 is not authentic. Since the same set of engineers have done the evaluation earlier and if subsequently they felt that there was some error in the earlier report, they should have explained detailed reasons either in the report itself or during the course of enquiry. Therefore, Ex. S-20 is not reliable.”
… … … …
20. Moreover a perusal of Ex. S-20 reveals that Shri Vasudev, Executive Engineer has recorded a note as follows:
“‘Hence the valuation of Shri S.N.Jha was never superseded by any other estimates. As is confirmed from the records, his estimated figures were only accounted for by the ITO Bokaro.”
Thus according to Shri Vasudev, who was the seniormost among the three CPWD engineers who prepared Ex. S-20, the valuation of ground floor remains at Rs 1,82,600 plus Rs 20,000 for the cost of land. The first floor as per Ex. S-20 was estimated at Rs 2,55,600 and a total of all this comes to Rs 4,57,600 which is very near to the declaration of actuals to the income tax authority and also the estimated cost by the Bokaro Steel Township Engineer and the government approved valuer.
20. At the risk of repetition, we may state that the charge had not been proved and on that basis the appellant was cleared of departmental enquiry. In this connection, we may also usefully cite a decision of this Court in State of Haryana v. Bhajan Lal [1992 Supp (1) SCC 335: 1992 SCC (Cri) 426]. This Court after considering almost all earlier decisions has given guidelines relating to the exercise of the extraordinary power under Article 226 of the Constitution or the inherent powers under Section 482 of the Code of Criminal Procedure for quashing an FIR or a complaint. This Court observed as follows: (SCC pp. 378-79, paras 102-3)
“In the backdrop of the interpretation of the various relevant provisions of the Code under Chapter XIV and of the principles of law enunciated by this Court in a series of decisions relating to the exercise of the extraordinary power under Article 226 or the inherent powers under Section 482 of the Code which we have extracted and reproduced above, we give the following categories of cases by way of illustration wherein such power could be exercised either to prevent abuse of the process of any court or otherwise to secure the ends of justice, though it may not be possible to lay down any precise, clearly defined and sufficiently channelised and inflexible guidelines or rigid formulae and to give an exhaustive list of myriad kinds of cases wherein such power should be exercised.
(1) 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.
(2) Where the allegations in the first information report and other materials, if any, accompanying the FIR do not disclose a cognizable offence, justifying an investigation by police officers under Section 156(1) of the Code except under an order of a Magistrate within the purview of Section 155(2) of the Code.
(3) Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same do not disclose the commission of any offence and make out a case against the accused.
(4) Where, the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated under Section 155(2) of the Code.
(5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused.
(6) Where there is an express legal bar engrafted in any of the provisions of the Code or the Act concerned (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the Act concerned, providing efficacious redress for the grievance of the aggrieved party.
(7) Where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge.
21. It is clear from the above discussions that though the document cited in Annexure III is a joint report of two engineers what has been brought on record is a document signed by three engineers, the same set of engineers who evaluated the property for income tax purposes, and there is a vast difference in the specifications and the rates adopted for calculating the cost in Ex. S-20 have been increased without any explanation and none of these engineers were produced during the course of enquiry to clarify the position. Hence the authenticity of Ex. S-20 is doubtful as claimed by the defence.
22. It needs to be mentioned that the report at Ex. S-20 has evaluated the ground floor at Rs 4,85,300 and a note to the effect that 10% should be allowed for self- supervision and procurement of material has also been recorded at the end. On this basis the net value of ground floor comes to Rs 4,36,810 (Rs 4,85,344-Rs 48,534). The first floor has been evaluated at Rs 2,55,600 after allowing the allowance for self- supervision and a total of both items would come to Rs 6,62,410. Thus, even the report at Ex. S-20 does not support the prosecution case that as per the report of CPWD Engineers the property is valued at Rs 7,69,800. As the property assessed by the income tax authority for Rs 4.67 lakhs and even the valuation given by the Bokaro Steel Township Engineer and the government- approved valuer are very near to this figure, the reasonable value of this property could only be taken as
4.75 lakhs assessed by the Bokaro Township Engineer on detailed estimate basis.”
(emphasis supplied)
Later, the Apex Court though not referring to P.S.RAJYA held in identical lines in the case of Radheshyam Kejriwal v. State of W.B (2011) 3 SCC 581, that standard of proof in a criminal case is much higher than that of adjudication in a departmental enquiry. If in a departmental inquiry, the competent authorities have failed to drive home the charge, it would be improper to permit criminal trial any further. This view of the Apex Court in the aforesaid case is reiterated in the later three Judge Bench in the case of Ashoo Surendranath Tewari v. CBI (2020) 9SCC 636, wherein the Apex Court has held as follows:
“8. A number of judgments have held that the standard of proof in a departmental proceeding, being based on preponderance of probability is somewhat lower than the standard of proof in a criminal proceeding where the case has to be proved beyond reasonable doubt. In P.S. Rajya v. State of Bihar [P.S. Rajya v. State of Bihar, (1996) 9 SCC 1 : 1996 SCC (Cri) 897] , the question before the Court was posed as follows: (SCC pp. 2-3, para 3)
“3. The short question that arises for our consideration in this appeal is whether the respondent is justified in pursuing the prosecution against the appellant under Section 5(2) read with Section 5(1)(e) of the Prevention of Corruption Act, 1947 notwithstanding the fact that on an identical charge the appellant was exonerated in the departmental proceedings in the light of a report submitted by the Central Vigilance Commission and concurred by the Union Public Service Commission.”
9. This Court then went on to state: (P.S. Rajya case [P.S. Rajya v. State of Bihar, (1996) 9 SCC 1 : 1996 SCC (Cri) 897] , SCC p. 5, para 17)
“17. At the outset we may point out that the learned counsel for the respondent could not but accept the position that the standard of proof required to establish the guilt in a criminal case is far higher than the standard of proof required to establish the guilt in the departmental proceedings. He also accepted that in the present case, the charge in the departmental proceedings and in the criminal proceedings is one and the same. He did not dispute the findings rendered in the departmental proceedings and the ultimate result of it.”
10. This being the case, the Court then held: (P.S. Rajya case [P.S. Rajya v. State of Bihar, (1996) 9 SCC 1 : 1996 SCC (Cri) 897] , SCC p. 9, para 23)
“23. Even though all these facts including the report of the Central Vigilance Commission were brought to the notice of the High Court, unfortunately, the High Court took a view [Prabhu Saran Rajya v. State of Bihar, Criminal Miscellaneous No. 5212 of 1992, order dated 3-8-1993 (Pat)] that the issues raised had to be gone into in the final proceedings and the report of the Central Vigilance Commission, exonerating the appellant of the same charge in departmental proceedings would not conclude the criminal case against the appellant. We have already held that for the reasons given, on the peculiar facts of this case, the criminal proceedings initiated against the appellant cannot be pursued. Therefore, we do not agree with the view taken by the High Court as stated above. These are the reasons for our order dated 27-3-1996 for allowing the appeal and quashing the impugned criminal proceedings and giving consequential reliefs.”
11. In Radheshyam Kejriwal v. State of W.B. [Radheshyam Kejriwal v. State of W.B., (2011) 3 SCC 581 : (2011) 2 SCC (Cri) 721] , this Court held as follows: (SCC pp. 594-96, paras 26, 29 & 31)
“26. We may observe that the standard of proof in a criminal case is much higher than that of the adjudication proceedings. The Enforcement Directorate has not been able to prove its case in the adjudication proceedings and the appellant has been exonerated on the same allegation. The appellant is facing trial in the criminal case. Therefore, in our opinion, the determination of facts in the adjudication proceedings cannot be said to be irrelevant in the criminal case. In B.N. Kashyap [B.N. Kashyap v. Crown, 1944 SCC OnLine Lah 46 : AIR 1945 Lah 23] the Full Bench had not considered the effect of a finding of fact in a civil case over the criminal cases and that will be evident from the following passage of the said judgment: (SCC OnLine Lah: AIR p. 27)
‘… I must, however, say that in answering the question, I have only referred to civil cases where the actions are in personam and not those where the proceedings or actions are in rem. Whether a finding of fact arrived at in such proceedings or actions would be relevant in criminal cases, it is unnecessary for me to decide in this case. When that question arises for determination, the provisions of Section
41 of the Evidence Act, will have to be carefully examined.’
***
29. We do not have the slightest hesitation in accepting the broad submission of Mr Malhotra that the finding in an adjudication proceeding is not binding in the proceeding for criminal prosecution. A person held liable to pay penalty in adjudication proceedings cannot necessarily be held guilty in a criminal trial. Adjudication proceedings are decided on the basis of preponderance of evidence of a little higher degree whereas in a criminal case the entire burden to prove beyond all reasonable doubt lies on the prosecution.
***
31. It is trite that the standard of proof required in criminal proceedings is higher than that required before the adjudicating authority and in case the accused is exonerated before the adjudicating authority whether his prosecution on the same set of facts can be allowed or not is the precise question which falls for determination in this case.”
12. After referring to various judgments, this Court then culled out the ratio of those decisions in para 38 as follows: (Radheshyam Kejriwal case [Radheshyam Kejriwal v. State of W.B., (2011) 3 SCC 581 : (2011) 2 SCC (Cri) 721] , SCC p. 598)
“38. The ratio which can be culled out from these decisions can broadly be stated as follows:
(i) Adjudication proceedings and criminal prosecution can be launched simultaneously;
(ii) Decision in adjudication proceedings is not necessary before initiating criminal prosecution;
(iii) Adjudication proceedings and criminal proceedings are independent in nature to each other;
(iv) The finding against the person facing prosecution in the adjudication proceedings is not binding on the proceeding for criminal prosecution;
(v) Adjudication proceedings by the Enforcement Directorate is not prosecution by a competent court of law to attract the provisions of Article 20(2) of the Constitution or Section 300 of the Code of Criminal Procedure;
(vi) The finding in the adjudication proceedings in favour of the person facing trial for identical violation will depend upon the nature of finding. If the exoneration in adjudication proceedings is on technical ground and not on merit, prosecution may continue; and
(vii) In case of exoneration, however, on merits where the allegation is found to be not sustainable at all and the person held innocent, criminal prosecution on the same set of facts and circumstances cannot be allowed to continue, the underlying principle being the higher standard of proof in criminal cases.”
13. It finally concluded: (Radheshyam Kejriwal case [Radheshyam Kejriwal v. State of W.B., (2011) 3 SCC 581 : (2011) 2 SCC (Cri) 721] , SCC p. 598, para 39)
“39. In our opinion, therefore, the yardstick would be to judge as to whether the allegation in the adjudication proceedings as well as the proceeding for prosecution is identical and the exoneration of the person concerned in the adjudication proceedings is on merits. In case it is found on merit that there is no contravention of the provisions of the Act in the adjudication proceedings, the trial of the person concerned shall be an abuse of the process of the court.”
… … … …
15. Applying the aforesaid judgments to the facts of this case, it is clear that in view of the detailed CVC order dated 22-12-2011, the chances
of conviction in a criminal trial involving the same facts appear to be bleak. We, therefore, set aside the judgment [Ashoo Surendranath Tewari v. CBI, 2014 SCC OnLine Bom 5042] of the High Court and that of the Special Judge and discharge the appellant from the offences under the Penal Code”.
In the aforesaid judgments, in the case of P.S.RAJYA and ASHOO SURENDRANATH TEWARI(supra), the Apex Court has clearly delineated, that if allegations in the departmental inquiry could not be proved on merit and the person is held to be innocent, criminal prosecution on the said facts cannot be permitted to be continued on the underlying principle of criminal trial needing higher standard of proof. Exoneration of the petitioner in the departmental enquiry is not on technicalities but on merits as there was no evidence against the petitioner to drive home the charge. Therefore, in terms of the law laid down by the Apex Court in the aforesaid judgments, in my considered view, the chances of the prosecution succeeding in the criminal trial being bleak, this Court cannot permit continuance of such criminal trial, any further.”
(Emphasis supplied)
Subsequent to the aforesaid order passed by this Court, coordinate Benches of this Court have also followed the same and obliterated the crime against those petitioners.
12. A coordinate Bench in Criminal Petition Nos.4791 of 2020 c/w.5195 of 2020, disposed on 05th March, 2022 has held as follows:
“10. Now coming to the another ground urged by the learned counsel for the petitioners that in the Departmental Enquiry report, they have found not guilty, such being the case, based upon the same witnesses, it is difficult to prove the case against the accused in the trial where it requires burden of proof beyond all reasonable doubt. In view of the judgment of the Hon'ble Supreme Court in the case of P.S.Rajya stated supra where the Hon'ble Supreme Court has quashed the FIR on the ground that the enquiry report was held, charges have not been proved, such being the case, allowing the ACB to investigate the case is nothing but abuse of process of law.
11. The Hon'ble Supreme Court in the case of Ashoo Surendranath Tewari Vs. The Deputy Superintendent of Police, Eow, Cbi And Ors. had taken similar view and held at paragraph 31 which as under:
"31. It is trite that the standard of proof required in criminal proceedings is higher than that required before the adjudicating authority and in case the accused is exonerated before the adjudicating authority whether his prosecution on the same set of facts can be allowed or not is the precise question which falls for determination in this case.” After referring to various judgments, this Court then culled out the ratio of those decisions in paragraph 38 as follows:-
“38.The ratio which can be culled out from these decisions can broadly be stated as follows:
(i) Adjudication proceedings and criminal prosecution can be launched simultaneously;
(ii) Decision in adjudication proceedings is not necessary before initiating criminal prosecution;
(iii) Adjudication proceedings and criminal proceedings are independent in nature to each other;
(iv) The finding against the person facing prosecution in the adjudication proceedings is not binding on the proceeding for criminal prosecution;
(v) Adjudication proceedings by the Enforcement Directorate is not prosecution by a competent court of law to attract the provisions of Article 20(2) of the Constitution or Section 300 of the Code of Criminal Procedure;
(vi) The finding in the adjudication proceedings in favour of the person facing trial for identical violation
will depend upon the nature of finding. If the exoneration in adjudication proceedings is on technical ground and not on merit, prosecution may continue; and
(vii) In case of exoneration, however, on merits where the allegation is found to be not sustainable at all and the person held innocent, criminal prosecution on the same set of facts and circumstances cannot be allowed to continue, the underlying principle being the higher standard of proof in criminal cases."
It finally concluded:
“39. In our opinion, therefore, the yardstick would be to judge as to whether the allegation in the adjudication proceedings as well as the proceeding for prosecution is identical and the exoneration of the person concerned in the adjudication proceedings is on merits. In case it is found on merit that there is no contravention of the provisions of the Act in the adjudication proceedings, the trial of the person concerned shall be an abuse of the process of the court."
12. Looking to both the complaints filed by respondent No.2, it clearly reveals that there is no case made out against accused Nos.1 and 2 for conducting investigation in this case. That apart, the complainant himself is facing the trial in respect of the charge-sheet filed by the Electronic City Police. The alleged incident took place on 11.04.2020 and the complaint came to be filed on 28.08.2020. After submission of preliminary and Departmental Enquiry report, the case has been registered which is nothing but abuse of process of law. Hence, FIR is liable to be quashed.
13. Accordingly, both the petitions filed by accused Nos.1 and 2 are herby allowed.
14. The FIR against accused Nos.1 and 2 in Crime No.35/2020 registered by ACB, pending on the file of Special Court is hereby quashed.”
Another coordinate Bench in W.P.No.43411 of 2019 disposed on 26th September, 2022, has held as follows:
“Reg.Point No.1:
6. The petitioner-accused is alleged to have been accepted gratification from the defacto complainant for passing the bill for its further process. The Departmental proceedings were initiated against the petitioner. The Enquiry committee after adjudicating the matter at length has exonerated the petitioner on the ground that the charge against the petitioner is not proved.
7. The Hon’ble Supreme Court in the case of Radheshyam Kejriwal Vs. State of West Bengal (2011) 3 SCC 581 has laid the principle which reads thus:
“38. The ratio which can be culled out from these decisions can broadly be stated as follows:
(i) Adjudication proceedings and criminal prosecution can be launched simultaneously;
(ii) Decision in adjudication proceedings is not necessary before initiating criminal prosecution;
(iii) Adjudication proceedings and criminal proceedings are independent in nature to each other;
(iv) The finding against the person facing prosecution in the adjudication proceedings is not binding on the proceeding for criminal prosecution;
(v) Adjudication proceedings by the Enforcement Directorate is not prosecution by a competent court of law to attract the provisions of Article 20(2) of the Constitution or Section 300 of the Code of Criminal Procedure;
(vi) The finding in the adjudication proceedings in favour of the person facing trial for identical violation will depend upon the nature of finding. If the exoneration in adjudication proceedings is on technical ground and not on merit, prosecution may continue; and
(vii) In case of exoneration, however, on merits where the allegation is found to be not sustainable at all and the person held innocent, criminal prosecution on the same set of facts and circumstances cannot be allowed to continue, the underlying principle being the higher standard of proof in criminal cases.”
8. The Hon’ble Supreme Court consisting of three learned Judges in the case of the State (NCT of Delhi) (supra) without reference to the decision in the case of Radheshyam Kejriwal (supra) has held that the High Court misread the judgment in P S Rajya –vs- State of Bihar ((1996) 9 SCC 1) and exoneration in departmental proceeding ipso facto would not lead to exoneration or acquittal in a criminal case. It was further noted that the decision of P S Rajya case which was rendered by the Bench consisting of two learned Judge was distinguished in a subsequent decision in the case of State –vs- L Krishnamohan which was again by a two Judges and accordingly held that the decision in P S Rajya was not an authority for the presumption that exoneration in departmental proceeding ipso facto would lead to a judgment of acquittal in a criminal trial.
9. The Hon’ble apex court in Hyder Consulting (UK) Ltd. v. State of Orissa, (2015) 2 SCC 189 has held that a decision can be said to be given per incuriam when the court of record has acted in ignorance of any previous decision of its own, or a subordinate court has acted in ignorance of a decision of the court of record. Therefore the decision of State (NCT of Delhi) which has not taken into account and consideration of the earlier decision of the Supreme Court in Radheshyam is said to be per incuriam.
10. The Full Bench of this Court in the case of Govindanaik G Kalaghatigi –vs- West Patent Press Co. Ltd. has held that where there is a conflict between two decisions of the Hon’ble Supreme Court of the same
Bench strength, it is latter of the decision that would prevail. The decision of the Bench consisting of three Judges in the case of Ashoo Surendranath Tiwari would prevail over the decision in the case of State (NCT of Delhi) rendered by consisting of three Judges which is a latter judgment. Though the decision of the State (NCT of Delhi) was unanimous and whereas in the case of Radheshyam Kejriwal it was a majority of 2:1, the total strength of the Bench that they decided the case is deemed to be the Bench strength of that decision despite dissenting opinion as held by the Hon’ble Supreme Court in the case of Shanti Fragrances –vs- Union of India (2018) 11 SCC 305.
11. In the instant case, the departmental enquiry was initiated against the petitioner-accused and after conducting the enquiry, the Enquiry Officer submitted a report stating that the charges against the delinquent have not been proved. Hence, in view of the ratio enunciated by the Hon’ble Apex Court, the impugned criminal proceeding cannot be continued against the accused who has been exonerated on identical charges in the departmental enquiry, the underlining principle being higher standard of proof in criminal cases.
Reg. point No.2:
12. Order passed under Section 19 of the Prevention of Corruption Act, granting permission to prosecute the petitioner for the aforesaid offence was passed by the Chief Engineer, Communications and Building (South). The petitioner contends that the officer who granted permission to prosecute the petitioner under section 19 of the P.C. Act was passed by the incharge officer which is evident from the notification dated 17.10.2011 wherein, it indicates that the said officer was appointed as incharge officer in the newly created post of Chief Engineer, Project Implementation Department. However, the impugned order was passed on 14.02.2014, and the petitioner has not produced any material before this Court to substantiate his claim that as on the date of passing of the impugned order, the said officer has passed the impugned order in the capacity of the incharge officer.
13. Even otherwise, the order passed by the competent authority granting permission to prosecute the petitioner under Section 19 of the Act, as incharge officer is not vitiated since, entrusting of the current duties, charge of a higher post does not amounts to promotion and in such cases the person continues to hold his substantive lower post and only discharges the duties of higher post essentially as a stopgap arrangement as held by the Hon'ble Supreme Court in the case of Gopalji Khanna supra and it was further held that Executive Director who was entrusted with the charge of duties of the offices of the Chairman and Managing Director became entitled to exercise all the executive powers, perform duties and discharge functions attached to those offices and, therefore, the order of penalty passed by him was legal and valid.
14. In view of the aforesaid decision rendered by the Hon'ble Apex Court in the case of Gopalji Khanna supra, even if it is accepted that the impugned order was passed by the incharge officer, the same does not stand vitiated.
15. In view of the aforesaid, I am of the considered view that the petitioner having been exonerated in the departmental enquiry on merits, it would be an abuse of process of law to continue the criminal proceedings against the petitioner, since the probability of conviction of the petitioner is remote and bleak.”
(Emphasis supplied)
The afore-quoted are the orders passed by this Court following the judgments of the Apex Court in the cases of Ashoo Surendranath Tewari Vs. CBI4, P.S. Rajya and Radheshyam Kejriwal (2011) 3 SCC 581. Those were cases where the petitioners therein had been exonerated in a departmental inquiry. The petitioner in the case at hand is issued a warning, which is not even a penalty. Therefore, it borders on exoneration, as the proceedings against him are closed. If there is nothing that would become ingredients of offences under the Prevention of Corruption Act or the offences under Sections 406 and 420 of the IPC as is alleged, could not be found against him, even on the evidence of the very same Investigating Officer and those very witnesses and on examination of the very same documents, which are now to be pitted against the petitioner in a criminal trial, in the considered view of this Court, the conviction of the petitioner is absolutely bleak. The bleakness of such conviction must lead to the closure of the proceedings against the petitioner, as the petitioner cannot be made to undergo the rigmarole of trial and the sword of pendency of a criminal case hanging on his head, notwithstanding the fact that he would not be convicted for the offences so alleged against him in the criminal trial.
13. For the aforesaid reasons, I pass the following:
O R D E R
(i) The Writ Petition is allowed.
(ii) Proceedings leading to the filing of Special C.C.No.1055 of 2019 before the CBI Special Court and all further actions thereto stand quashed insofar as accused No.26/petitioner is concerned.
(iii) In the light of the quashment of the proceedings, the petitioner would become entitled to all consequential benefits, be it benefits of conditions of service, service benefits or any other incidental benefits that would flow from such quashment.
(iv) It is made clear that the observations made in the course of the order are only for the purpose of consideration of the case of petitioner under Section 482 of Cr.P.C. and the same shall not bind or influence the proceedings against any other accused pending before the Special Court or any other fora.
Consequently, pending applications also stand disposed.
