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Special Court

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Sanction to prosecution is a conditional precedent = whether the Special Judge/Magistrate is justified in referring a private complaint made under Section 200 Cr.P.C. for investigation by the Deputy Superintendent of Police – Karnataka Lokayukta, in exercise of powers conferred under Section 156(3) Cr.P.C. without the production of a valid sanction order under Section 19 of the Prevention of Corruption Act, 1988.= The High Court, after hearing the parties, took the view that the Special Judge could not have taken notice of the private complaint unless the same was accompanied by a sanction order, irrespective of whether the Court was acting at a pre-cognizance stage or the post- cognizance stage, if the complaint pertains to a public servant who is alleged to have committed offences in discharge of his official duties. The High Court, therefore, quashed the order passed by the Special Judge, as well as the complaint filed against the appellant. ;Taking cognizance of an offence= “It is necessary to mention here that taking cognizance of an offence is not the same thing as issuance of process. Cognizance is taken at the initial stage when the Magistrate applies his judicial mind to the facts mentioned in a complaint or to a police report or upon information received from any other person that an offence has been committed. The issuance of process is at a subsequent stage when after considering the material placed before it the court decides to proceed against the offenders against whom a prima facie case is made out.”; whether, in the above mentioned legal situation, the requirement of sanction is a pre-condition for ordering investigation under Section 156(3) Cr.P.C., even at a pre-cognizance stage. Section 2(c) of the PC Act deals with the definition of the expression “public servant” and provides under Clauses (viii) and (xii) as under: “(viii) any person who holds an office by virtue of which he is authorised or required to perform any public duty. (xii) any person who is an office-bearer or an employee of an educational, scientific, social, cultural or other institution, in whatever manner established, receiving or having received any financial assistance from the Central Government or any State Government, or local or other public authority.”= When a Special Judge refers a complaint for investigation under Section 156(3) Cr.P.C., obviously, he has not taken cognizance of the offence and, therefore, it is a pre-cognizance stage and cannot be equated with post-cognizance stage. = “19. Previous sanction necessary for prosecution.—(1) No court shall take cognizance of an offence punishable under Sections 7, 10, 11, 13 and 15 alleged to have been committed by a public servant, except with the previous sanction— a) in the case of a person who is employed in connection with the affairs of the Union and is not removable from his office save by or with the sanction of the Central Government, of that Government; b) in the case of a person who is employed in connection with the affairs of a State and is not removeable from his office save by or with the sanction of the State Government, of that Government; c) in the case of any other person, of the authority competent to remove him from his office.”- “Section 19(3) – Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974)- a) no finding, sentence or order passed by a special judge shall be reversed or altered by a court in appeal, confirmation or revision on the ground of absence of, or any error, omission or irregularity in the sanction required under sub-section (1), unless in the opinion of that Court, a failure of justice has in fact been occasioned thereby; b) xxx xxx xxx c) xxx xxx xxx”= Once it is noticed that there was no previous sanction, as already indicated in various judgments referred to hereinabove, the Magistrate cannot order investigation against a public servant while invoking powers under Section 156(3) Cr.P.C. – “Thus, in view of the above, the law on the issue of sanction can be summarized to the effect that the question of sanction is of paramount importance for protecting a public servant who has acted in good faith while performing his duty. In order that the public servant may not be unnecessarily harassed on a complaint of an unscrupulous person, it is obligatory on the part of the executive authority to protect him….. If the law requires sanction, and the court proceeds against a public servant without sanction, the public servant has a right to raise the issue of jurisdiction as the entire action may be rendered void ab-initio.”= We are of the view that the principles laid down by this Court in the above referred judgments squarely apply to the facts of the present case. We, therefore, find no error in the order passed by the High Court. The appeals lack merit and are accordingly dismissed.

  published in   http://judis.nic.in/supremecourt/imgst.aspx?filename=40843     REPORTABLE           IN THE SUPREME COURT OF INDIA   CRIMINAL APPELLATE JURISDICTION   CRIMINAL APPEAL NOS. 1590-1591 OF 2013 (@ Special Leave Petition (Criminal) Nos.6652-6653 of 2013)   Anil Kumar & Ors. ….. Appellants   Versus   M.K. Aiyappa & Anr. ….. Respondents     … Continue reading

Section 13(2) read with 13(1)(e) of the Prevention of Corruption Act, 1988 read with Section 109 of the Indian Penal Code.- Non- filing of original complaint not fatal when not relied upon it = whether the prosecution is bound to produce the original complaint/application filed by an unknown person, based on which an inquiry was initiated by the Anti Corruption Bureau.= the prosecution has categorically taken the stand that they do not propose to rely upon the information passed on to the Anti Corruption Bureau leading to an open inquiry against the accused persons. We fail to see how the accused persons are prejudiced by non-disclosure of the name of the person who sent the complaint as well as the original copy of the complaint received by the Anti Corruption Bureau. Situations are many where certain persons do not want to disclose the identity as well as the information/complaint passed on them to the Anti Corruption Bureau. If the names of the persons, as well as the copy of the complaint sent by them are disclosed, that may cause embarrassment to them and sometimes threat to their life. This complaint only triggered an enquiry. Ultimately, the first information was lodged on the basis of an open inquiry bearing VER No.31/1987 and it is based on that inquiry the first information report dated 13.10.1992 was registered. After completion of the investigation and after getting the sanction to prosecute accused No.1, charge-sheet was filed. PW1 also did not depose anything about the receipt of complaint/application in his examination-in-chief but receipt of the complaint/application and its contents having been relied upon by the defence during cross-examination of PW1. 11. We also emphasize that in the instant case the prosecution has relied upon the material which was collected during the investigation. It is not a case where some materials/documents were collected by the investigating agency during the investigations which are in favour of the prosecution and the prosecution is suppressing those documents. We are of the opinion that non-supply of the complaint or contents thereof do not, at all, violate the principle of fair trial. The said complaint has no relevancy in the context of this prosecution and in no manner, it would prejudice the petitioner. 12. Above being the factual and legal position, we find no reason to interfere with the order of the Bombay High Court and dismiss this special leave petition.

 published in    http://judis.nic.in/supremecourt/imgst.aspx?filename=40662    REPORTABLE IN THE SUPREME COURT OF INDIA CRIMINAL APPEALLATE JURISDICTION SPECIAL LEAVE PETITION (CRIMINAL) NO.5897 OF 2013   Manjeet Singh Khera …. Petitioner Versus State of Maharashtra ….Respondent O R D E R   K.S. Radhakrishnan, J.   1. We are, in this case, concerned with the question whether the … Continue reading

Uttar Pradesh Gangsters and Anti-Social Activities (Prevention) Act, 1986 = question the constitutional validity of number of provisions of the Uttar Pradesh Gangsters and Anti- Social Activities (Prevention) Act, 1986 (Act 7 of 1986) (for short “the Act”) being violative of Articles 14, 21, 22(4) and 300A of the Constitution of India and further prayed for issue of a writ of certiorari for quashment of the First Information Report dated 2.5.2010 giving rise to Crime No. 100 of 2010 registered at Police Station Ramala, District Baghpat.= Thus, the accused under the Act is in a distinct category and the differentiation between the two, namely, a person arrayed as an accused in respect of offences under other Acts and an accused under the Act is a rational one. It cannot be said to be arbitrary. It does not defeat the concept of permissible classification. The majority in Kartar Singh (supra) has expressed thus: – “218. The principle of legislative classification is an accepted principle whereunder persons may be classified into groups and such groups may differently be treated if there is a reasonable basis for such difference or distinction. The rule of differentiation is that in enacting laws differentiating between different persons or things in different circumstances which govern one set of persons or objects such laws may not necessarily be the same as those governing another set of persons or objects so that the question of unequal treatment does not really arise between persons governed by different conditions and different set of circumstances.”= Tested on the touchstone of the abovestated principles, the irresistible conclusion is that the classification is in the permissible realm of Article 14 of the Constitution. Therefore, the submission that Section 12 invites the wrath of Article 14 of the Constitution is sans substratum and, accordingly, we have no hesitation in repelling the same and we so do. 47. In view of the aforesaid analysis, we uphold the constitutional validity of Section 12 of the Uttar Pradesh Gangsters and Anti-Social Activities (Prevention) Act, 1986 as it does not infringe any of the facets of Articles 14 and 21 of the Constitution of India. Ex- consequenti, the writ petition, being devoid of merit, stands dismissed.

 published in   http://judis.nic.in/supremecourt/imgst.aspx?filename=40619  IN THE SUPREME COURT OF INDIA CRIMINAL ORIGINAL JURISDICTION WRIT PETITION (CRL.) NO. 100 OF 2010 Dharmendra Kirthal … Petitioner Versus State of U.P. and another … Respondents J U D G M E N T Dipak Misra, J.   In this writ petition preferred under Article 32 of the Constitution of … Continue reading

The Uttar Pradesh Gangsters and Anti-Social Activities (Prevention) Act, 1986 = question the constitutional validity of number of provisions of the Uttar Pradesh Gangsters and Anti- Social Activities (Prevention) Act, 1986 (Act 7 of 1986) (for short “the Act”) being violative of Articles 14, 21, 22(4) and 300A of the Constitution of India and further prayed for issue of a writ of certiorari for quashment of the First Information Report dated 2.5.2010 giving rise to Crime No. 100 of 2010 registered at Police Station Ramala, District Baghpat.= Thus, the accused under the Act is in a distinct category and the differentiation between the two, namely, a person arrayed as an accused in respect of offences under other Acts and an accused under the Act is a rational one. It cannot be said to be arbitrary. It does not defeat the concept of permissible classification. The majority in Kartar Singh (supra) has expressed thus: – “218. The principle of legislative classification is an accepted principle whereunder persons may be classified into groups and such groups may differently be treated if there is a reasonable basis for such difference or distinction. The rule of differentiation is that in enacting laws differentiating between different persons or things in different circumstances which govern one set of persons or objects such laws may not necessarily be the same as those governing another set of persons or objects so that the question of unequal treatment does not really arise between persons governed by different conditions and different set of circumstances.”= Tested on the touchstone of the abovestated principles, the irresistible conclusion is that the classification is in the permissible realm of Article 14 of the Constitution. Therefore, the submission that Section 12 invites the wrath of Article 14 of the Constitution is sans substratum and, accordingly, we have no hesitation in repelling the same and we so do. 47. In view of the aforesaid analysis, we uphold the constitutional validity of Section 12 of the Uttar Pradesh Gangsters and Anti-Social Activities (Prevention) Act, 1986 as it does not infringe any of the facets of Articles 14 and 21 of the Constitution of India. Ex- consequenti, the writ petition, being devoid of merit, stands dismissed.

 published in   http://judis.nic.in/supremecourt/imgst.aspx?filename=40619  IN THE SUPREME COURT OF INDIA CRIMINAL ORIGINAL JURISDICTION WRIT PETITION (CRL.) NO. 100 OF 2010 Dharmendra Kirthal … Petitioner Versus State of U.P. and another … Respondents   J U D G M E N T Dipak Misra, J.   In this writ petition preferred under Article 32 of the Constitution … Continue reading

The Uttar Pradesh Gangsters and Anti-Social Activities (Prevention) Act, 1986 = constitutional validity of number of provisions of the Uttar Pradesh Gangsters and Anti-Social Activities (Prevention) Act, 1986 (Act 7 of 1986) (for short “the Act”) being violative of Articles 14, 21, 22(4) and 300A of the Constitution of India and further prayed for issue of a writ of certiorari for quashment of the First Information Report dated 2.5.2010 giving rise to Crime No. 100 of 2010 registered at Police Station Ramala, District Baghpat .= In view of the aforesaid analysis, we uphold the constitutional validity of Section 12 of the Uttar Pradesh Gangsters and Anti-Social Activities (Prevention) Act, 1986 as it does not infringe any of the facets of Articles 14 and 21 of the Constitution of India. Ex- consequenti, the writ petition, being devoid of merit, stands dismissed.

 published in http://judis.nic.in/supremecourt/imgst.aspx?filename=40619 IN THE SUPREME COURT OF INDIA CRIMINAL ORIGINAL JURISDICTION WRIT PETITION (CRL.) NO. 100 OF 2010 Dharmendra Kirthal … Petitioner Versus State of U.P. and another … Respondents J U D G M E N T Dipak Misra, J. In this writ petition preferred under Article 32 of the Constitution of India, the … Continue reading

APEX COURT UPHELD THAT THE SUIT FILED BY NATIONAL HOUSING BANK UNDER SPECIAL ACT ENACTED FOR PURPOSE OF HARSHAD S. MEHTA , IS ONLY AN EYE WASH =The entire scandal and the present litigation revolves around the second defendant (since deceased) – one Harshad S. Mehta (a notified person under Section 3(2) of the Act). The scandal exposes the shortcomings and loopholes in the administration of banking sector of this country, more particularly, the State-owned/controlled banks. 6. The National Housing Bank (hereinafter referred to as the ‘Plaintiff’) a statutory Corporation created by an Act of Parliament (Act No. 53 of 1987) filed two suits, one invoking the original jurisdiction of Bombay High Court (Suit No. 211 of 1995) and another before the Special Court established under the Act No. 27 of 1992 being Suit No. 2 of 1995. The said suits came to be filed against (i) the State Bank of Saurashtra which at that point of time was a subsidiary bank of the State Bank of India but later got amalgamated with the State Bank of India, (ii) Harshad S. Mehta, (iii) two of the employees of the plaintiff bank and (iv) the Custodian appointed under Section 3(1) of the Act 27 of 1992.= No oral evidence from plaintiff side except filing some documents – At the time when these documents were being tendered it was clarified to all parties that mere tendering of documents would only establish that there was in existence such a document and that it stated what is stated. It was clarified that the contents of the documents would not be deemed to have been proved. It was clarified that any party who wanted to prove the truth of the contents had to do so by positive evidence. As stated above, except for 2nd Defendant, no other party has led any oral evidence.”; Janakiraman Committee Report – not admissible = The Special Court Act though declares that the Court is not bound by the Code of Civil Procedure, it does not relieve the Special Court from the obligation to follow the Evidence Act. Further, the learned Judge extensively relied upon the second interim report of the Jankiraman Committee[11] on the ground that the same was tendered[12] by the 1st defendant. 51. Irrespective of the fact whether such a report is admissible in evidence or not, = It is well settled by a long line of judicial authority that the findings of even a statutory Commission appointed under the Commissions of Inquiry Act, 1952 are not enforceable proprio vigore as held in Ram Krishna Dalmia v. Justice S.R. Tendolkar and Others [AIR 1958 SC 538] and the statements made before such Commission are expressly made inadmissible in any subsequent proceedings civil or criminal. In our considered view the report of Janakiraman Committee is not evidence within the meaning of Evidence Act; There is absolutely no evidence on record regarding the payment of the above mentioned amount of Rs.55 crores (approx.) by the plaintiff-Bank to the Standard Chartered Bank except the Janakiraman Committee Report and the correspondence which is neither proved nor the content of the correspondence is explained. On the other hand, the Special Court recorded[17] with respect to the payment of Rs.55 crores (approx.) to the Standard Chartered Bank by the plaintiff – “In the plaintiff’s record there is no clear indication as to for what transaction this cheque had been issued. The plaintiffs were, therefore, not sure for what this cheque had been issued.” 62. In the background of the above discussed pleadings and evidence, we are of the opinion the suit is required to be dismissed on the ground that there is no evidence led by the plaintiff to establish its case. ; suppression of material facts = We must also record our disapproval of the finding recorded by the Special Court that the plaintiff did not suppress the truth. We are of the opinion that the plaintiff approached the Special Court with unclean hands by suppressing the relevant material. We shall first discuss the nature of the suppression and then examine the legal consequences that should follow.= The whole attempt of both the banks is to shield the officers on either side taking refuge under attractive legal pleas – which if examined in the context of the limited facts pleaded give a picture that the suit transaction is an innocuous transaction which unfortunately for the country is not. In our opinion the suit is a sheer abuse of the legal process.= both the plaintiff and respondent Banks simply reiterated their respective stands before the Committee of Secretaries. No attempt appears to have been made by the Government to find out the truth as to (1) how the plaintiff Bank parted with a high denomination cheque and gave custody of the same to Harshad Mehta and (2) as to how the first defendant Bank paid the various amounts to the dictation of Harshad Mehta in the absence of any authorisation by the plaintiff Bank. Be that as it may, if really the Government believed that the judgment of the Special Court does not require any interference, nothing stopped the Government from directing both the Banks to withdraw their appeals before this Court. 74. The whole exercise appears to be an eye wash. A thinly veiled scorn for the orders of this Court.= The professed purpose of the Special Courts Act – the back drop of the scandal that shook the nation – and the manner in which the litigation was conducted coupled with the absolute indifference of the Government to get at the truth only demonstrates the duplicity with which Governments can act. 76. We dismiss the suit and set aside the decree in toto. The consequences follow insofar as the appeals are concerned. But in the circumstances, we do not award any costs.

published in     http://judis.nic.in/supremecourt/imgst.aspx?filename=40614  Reportable IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 2155 OF 1999 State Bank of India Thr. General Manager …Appellant Versus National Housing Bank & Ors. …Respondents WITH CIVIL APPEAL NO. 2294 OF 1999 CIVIL APPEAL NO. 3647 OF 1999 J U D G M E N … Continue reading

Scope of Sec.120 B of I.P.C. = what will be the effect of acquittal of co-accused Nos.1 and 2 on the case of accused No.3. According to the appellant if co-accused No.1 is acquitted and in view of acquittal of co- accused No.2 no charge under Sections 409, 411 and 477-A substantiate against accused No.3 and he cannot be punished with the aid of Section 120-B IPC.= However, in view of the acquittal of accused Nos.1 and 2, the order of conviction of accused No.3 under Section 477-A is set aside. The judgment dated 6th September, 2001 passed by the learned Special Judge is affirmed with modification as mentioned above. The appeal (Criminal Appeal No.1226 of 2001) filed by the appellant-Hiten P. Dalal is dismissed. The bail bonds of the appellant – Hiten P. Dalal, if he is on bail, shall stand cancelled and he is directed to be taken into custody to serve out the remainder of the sentence.

‘  published in http://courtnic.nic.in/supremecourt/qrydisp.asp REPORTABLE IN THE SUPREME COURT OF INDIA CRIMINAL APPELLATE JURISDICTION CRIMINAL APPEAL NO.1001 OF 2001 B. RAGHUVIR ACHARYA … APPELLANT VERUS CENTRAL BUREAU OF INVESTIGATION … RESPONDENT WITH CRIMINAL APPEAL NO.1226 OF 2001 HITEN P. DALAL … APPELLANT VERUS CENTRAL BUREAU OF INVESTIGATION … RESPONDENT J U D G M E N T … Continue reading

custodian sold the shares less than the market price to the appollo management instead of inviting them after the final bid giving an opportunity- – bid was set aside as it is arbitrary- Harshd Mehatha case= the Special Court Act which is a special statute, is a complete code in itself. The purpose and object for which it was enacted was not only to punish the persons who were involved in the act of criminal misconduct by defrauding the banks and financial institutions but also to see that the properties, moveable or immovable or both, belonging to the persons notified by the Custodian were appropriated and disposed of for discharge of liabilities to the banks and financial institutions, specified government dues and any other liability. Therefore, a notified party has an intrinsic interest in the realisations, on the disposal of any attached property because it would have a direct bearing on the discharge of his liabilities in terms of Section 11 of the Special Court Act. It is also clear that the Custodian has to deal with the attached properties only in such manner as the Special Court may direct. The Custodian is required to assist in the attachment of the notified person’s property and to manage the same thereafter. The properties of the notified persons, whether attached or not, do not at any point of time, vest in him, unlike a Receiver under the Civil Procedure Code or an official Receiver under the Provincial Insolvency Act or official Assignee under the Presidency Insolvency Act (See : B.O.I. Finance Ltd. Vs. Custodian & Ors.13). The statute 13 (1997) 10 SCC 488 2

REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 4263 OF 2003 ASHIWIN S. MEHTA & ANR. — APPELLANTS VERSUS UNION OF INDIA & OTHERS — RESPONDENTS J U D G M E N T D.K. JAIN, J.: 1. This appeal under Section 10 of the Special Court (Trial of Offences … Continue reading

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