Ajit Kumar vs State of Jammu & Kashmir

V.K. Jhanji, J.—Petitioner, a senior IAS Officer of 1970 batch presently holding the post of Financial Commissioner (Finance) in the pay

grade of Chief Secretary in the State of Jammu and Kashmir, has filed this petition u/s 497A of the Criminal Procedure Code, 1989 (1933 A.D.)

for grant of bail in anticipation of his arrest in a case registered under FIR No. 69 of 1999 with the Vigilance Organisation, Jammu, for the offences

u/s 5(2) of the J&K Prevention of Corruption Act, 2006 (1949 A.D.) read with Section 161 and Section 120B of the Ranbir Penal Code, 1989

(1932 A.D.)

Earlier to filing of this petition, petitioner had filed an application for grant of bail in anticipation of his arrest before the court of Special Judge

Anti Corruption, Jammu, who, vide detailed order dated 11.9.2004, dismissed the application and opined that this is an appropriate case where

the petitioner should submit to custodial interrogation.

Facts, relevant for disposal of the present petition, briefly stated are that vide Government Order No. 953-Edu of 1997 dated 30.6.1997, State

Level Purchase Committee was constituted comprising the following:-

ACS/Commr/Secy. Education Department, as Chairman.

Director School Education Kashmir/Jammu, as Members.

FA/CAO Education Department, Member Secretary, and

Director Industries & Commerce, or his representative, as Member.

Vide addendum dated 8.10.1997 to aforesaid government order, another Member i.e. Additional Secretary Education Department, was

included in the State Level Purchase Committee. The State Level Purchase Committee (hereinafter referred to as the Committee) issued NIT No.

Edu-Acctt/Pur/97-98-70 dated 16.7.199, inviting tenders from original manufacturers for supply of jute matting for Schools in the State for the

year 1997-98. As per terms and conditions of the Tender Notice the supply was to be strictly as per approved sample and in case of any

deviation the tenderer was liable to be held responsible. Clause (f) of the tender notice also permitted Authorised Stockists to submit tender but

alongwith the tender they were to submit original authority letter from the original manufacturer of jute matting. In response to tender notice, nine

tenders were received. On 28.7.1997 tenders received were opened and one of the tender was from M/S Commercial Corporation of Lala Rukh

Building, Srinagar, the owner of which was one Abdul Rehman Bhat. However, no decision was taken to place order on any of the tenderer.

Meanwhile, petitioner came to be appointed as Commissioner/Secretary to Government Education Department and by virtue of his office he

became ex-officio Chairman of the State Level Purchase Committee. The Committee decided to purchase jute matting of Birla Make only, which

resulted in excluding six tenderers from the zone of consideration. Out of the three short-listed tenderers, M/s. Commercial Corporation of Lala

Rukh Building, Srinagar, was approved as being lowest as it had quoted the rate of Rs. 57.75/- per meter. Negotiations were held with the said

Concern for reducing the price and on negotiations the owner of the Concern, namely Abdul Rehman Bhat, reduced the price to Rs. 55.50/-. Shri

A.K.Mehta, who was Director School Education Jammu at that time, objected to the decision to purchase jute matting only of Birla Make and

from M/S Commercial Corporation, but objection raised was ignored. On 23.10.1997 and 20.10.1998 respectively, two supply orders were

placed by the Committee with M/S Commercial Corporation of Lala Rukh Building Srinagar. The said Concern supplied 4.10 lac meters of Birla

Make jute matting against an amount of Rs. 2.20/- Crores.

It appears that some complaint was received in regard to purchase of Birla Make jute matting from M/s Commercial Corporation and in this

regard a preliminary inquiry was conducted which revealed that the Committee during the year 1997-98 placed two orders for supply 3 lac meters

and 2.55 lac meters jute matting of Birla Make with M/S Commercial Corporation on exorbitant rate and by abuse of official position and in

connivance with the Supplier a huge loss was caused to the State Exchequer. On the basis of preliminary inquiry, J&K Vigilance Organisation

registered a case FIR No. 69 of 1999 dated 24.11.1999. During the course of investigation it was revealed that Birla Jute Company, who was

manufacturer of jute matting, was supplying material only at Rs. 43/- per meter FOR Srinagar but in the present case the material was supplied at

the rate of Rs. 55.50/-per meter to the State Education Department. Investigation further revealed that out of three short-listed tenderers, one

International Trading Corporation was found non-existent and another Concern namely Kashmir Furnishing House, was found to be proprietary

Concern of Muzaffar Sajad Bhat, who happened to be son of Abdul Rehman Bhat, the Proprietor of M/S Commercial Corporation, in whose

favour supply orders were placed. It appears that all the three short-listed tenders were arranged by one and the same firm, because two other

short-listed tenderers, namely Kashmir Furnishing House Srinagar and International Trading Corporation alongwith their tenders had submitted two

cheques of Abdul Rehman Bhat in place of CDR or FDR, which was a pre-requisite condition for acceptance of tender. The two proxy firms of

Abdul Rehman Bhat did not pledge FDR/CDR for Rs. Two lacs with the tender document.

In fact, two cheques drawn on Bombay Mercantile Cooperative Bank and Punjab National Bank enclosed with the tender by the aforesaid two

firms were found invalid and drawn on non-existent accounts. Case of the prosecution further is that prior to issuance of supply orders, the supplier

Abdul Rehman Bhat was approached by one Ghulam Rasool Vakil alias Lassa Vakil to make him a Partner in supply of jute matting to the

Education Department. However, the proposal was rejected by Abdul Rehman Bhat, but later on Abdul Rehman Bhat was called by the petitioner

in his office at Civil Secretariat Srinagar, asking the supplier to associate Lassa Vakil in the supply. It is said that supplier succumbed to the

pressure and entered into a deal with Lassa Vakil and in this context an agreement was drawn between the supplier Abdul Rehman Bhat and Umer

Vakil son of Ghulam Rasool Vakil. In terms of the said agreement 40% of the benefit of contract was to go to Umer Vakil s/o Ghulam Rasool

Vakil and accordingly an amount of Rs. 34.50/- lacs was given by Ghulam Rasool Vakil to the supplier to go ahead with the supplies. The money

was returned by the supplier alongwith interest of Rs. 1.5/- lacs and a profit of Rs. 12.5/- lacs. It is said that Lassa Vakil was the middle man for

the petitioner.

Thus two sets of allegations are levelled against the petitioner. First set of allegation is short-listing of only three tenderers and placing of order of

supply of jute matting with M/S Commercial Corporation of Lala Rukh Building Srinagar and second set of allegation pertains to calling of Abdul

Rehman Bhat, the Proprietor of M/S Commercial Corporation in his office chamber Srinagar, directing him to associate Lassa Vakil in making the

supply. Thus the allegation is that in his capacity as ex-officio Chairman of the State Level Purchase Committee, the petitioner deliberately and

willfully took a decision to purchase jute matting from M/S Commercial Corporation and paved a way for Lassa Vakil to be a partner of Abdul

Rehman Bhat, thereby causing huge loss to the State Exchequer. In order to bring out the whole truth the State Vigilance Organisation seeks

custodial interrogation of the petitioner.

Mr Ram Jethmalani, Senior Advocate, appearing for the petitioner has pressed for grant of bail in anticipation of arrest of the petitioner on the

ground that petitioner has excellent service record of about thirty years and in due course he would have been promoted to the rank of Chief

Secretary of the State but at the behest of some vested interests a ""dead case has been revived from the grave"" by the Vigilance Organisation, to

implicate the petitioner. Learned Senior Advocate submits that the State Vigilance Organisation remained inactive since 1999 and never summoned

petitioner and all of a sudden petitioner was asked to appear before the Vigilance Organisation on 6.9.2004. Learned counsel further submits that

the Special Judge Anti Corruption has erroneously rejected the anticipatory bail application of the petitioner on the ground that petitioner is an

absconder. According to learned Senior Advocate, petitioner apprehending his arrest took leave for about ten days so as to apply for grant of bail

in anticipation of his arrest and he therefore proceeded to Jammu and filed application for grant of bail in anticipation of his arrest before the court

of Special Judge Anti Corruption Jammu on 8.9.2004 and on rejection of his application he lost no time to apply to this Court for grant of bail in

anticipation of the arrest and in such circumstances it cannot be said that petitioner is an absconder. Mr Ram Jethmalani, learned Senior Advocate,

further contends that State Level Purchase Committee comprised of five members and barring Mr. A.K. Mehta, the then Director School

Education Jammu, all were party to the decision that was taken to purchase jute matting from M/S Commercial Corporation and all the members

attended two meetings in October 1997 when the decisions to make supply order were taken by the Committee. His precise submission is that

why other members of the Committee are not being questioned and why petitioner alone is being roped in.

Learned counsel submits that whole affair against the petitioner has been master minded by vested interests in the bureaucracy and politicians who

want petitioner to be out of service. Learned Senior Advocate also contends that according to FIR lodged by the Vigilance Organisation J&K,

Ghulam Rasool alias Lassa Vakil has proved to be nothing more than a Financier as he provided Rs. 34.50/- lacs to the Supplier to go ahead with

the purchase of jute matting for making supply to the State Education Department. It is also submitted that according to the prosecution case,

Ghulam Rasool alias Lassa Vakil in the said transaction earned a profit of Rs. 12.5/- lacs and interest of Rs. 1.5/- lacs, and the said amount so

earned cannot be said to be so exorbitant so as to say that petitioner was involved in the whole episode. Lastly, Mr. Ram Jethmalani, Senior

Advocate submitted that petitioner is ready to cooperate with the investigation and in this regard he would comply with any of the condition which

may be imposed by the court while allowing the application of petitioner for grant of bail in anticipation of his arrest.

On the other hand, Mr. B.S. Slathia, learned Additional Advocate General appearing on behalf of the State, submits that the allegation against

the petitioner are quite serious in as much as investigation has revealed that it was at the instance of petitioner that out of nine tenderers six were

excluded and only three were short-listed and even two out of these three short-listed tenderers were found to be proxy Concerns of M/S

Commercial Corporation, with whom orders for supply of jute matting were placed. Mr Slathia further submits that statement of the supplier Abdul

Rehman Bhat recorded by the City Judge Srinagar u/s 164 Criminal Procedure Code clearly implicates the petitioner as in the said statement the

supplier has revealed the role of the petitioner in inducting Ghulam Rasool alias Lassa Vakil as a partner in the supply. According to Mr Slathia,

petitioner has entered into conspiracy with Ghulam Rasool alias Lassa Vakil, pursuant to which supply orders were placed with M/S Commercial

Corporation and in order to unearth the truth in the conspiracy and also the role of the petitioner in the shady transaction, Vigilance Organisation is

required to be given full opportunity to interrogate petitioner enabling it to come out with the truth. Learned AAG further submits that after

obtaining permission from the court of Special Judge Anti Corruption Jammu, raids were conducted at three residential houses of the petitioner, i.e.

at Srinagar, Jammu and Delhi. Likewise raids were also conducted at the residences of Ghulam Rasool alias Lassa Vakil at Srinagar and Jammu

and also of Janak Singh, Financial Advisor/CAO, who was Member/Secretary of the Selection Committee. Mr. Slathia submits that searches

conducted at the houses of the petitioner has, among others, yielded recovery of huge cash approximately Rs. 6.90/- lacs (Rs. 5.19/- lacs cash

was recovered from one Almirah at the house of petitioner at Jammu and Rs. 1.71/- lacs was recovered from the search of the house at Srinagar).

In addition thereof, FDRs/TDRs worth Rs. 16.15/- lacs, various saving Bank pass books, shares of the Company approximately totaling to Rs.

73/- lacs were also recovered. This is in addition to Jewellery, Ornaments, precious stones, electronic gadgets, movable and immovable properties

owned by the petitioner. According to Mr Slathia the size of the assets which have been found to be possessed by the petitioner has raised a

strong suspicion that the petitioner has been indulging in corrupt practices and the purchase of jute matting from M/S Commercial Corporation is

only a tip of the ice berg. Further, Mr Slathia submits that during the course of house searches of petitioner and Ghulam Rasool alias Lassa Vakil,

number of documents pertaining to work contract and supply orders have been found. Mr. Slathia also produced expenditure statement in the

hand of Ghulam Rasool alias Lassa Vakil pertaining to the year 1998 for perusal of the court which was found during the course of search made in.

the house of Ghulam Rasool alias Lassa Vakil, whereby it is revealed that payments to the tune of lacs of rupees have been made to various

officials of the State Government. In this hand-written expenditure statement besides showing payment towards Air Travel of 'Mr. A.K', payment

to the tune of Rs. 2/- lacs is also reflected against one ""Mr. K"". According to Mr Slathia it is suspected that the name of ""Mr. A.K."" and ""Mr. K

pertains to Ajit kumar, i.e. the petitioner. Learned AAG also referred to the statement of account of City Bank showing a deposit of Rs. 1.25/-

lacs during the period supply order was placed with M/S Commercial Corporation, Srinagar. Mr Slathia also submits that some coded

words/messages were found fed in the computer at the house of the petitioner, which can be explained by him only. In regard to delay in

proceeding with the investigation by the Vigilance Organisation, Mr Slathia submits that petitioner being a high ranking IAS Officer serving in the

State of J&K was able to stall the investigation and taking overall view of the whole case if custodial interrogation is not permitted by this Court the

whole truth would never come out.

In regard to submission of Mr Ram Jethmalani that Ghulam Rasool alias Lassa Vakil is a Financier and negligible profit alleged to have been

made by him, Mr Slathia submits that it is not so much the amount of the bribe but the quantum of loss to the people and moral degradation it

involves that is more relevant. He submits that custodial interrogation is more effective in such like cases and as such considering the serious nature

of the offences and in the facts and circumstances of the case prayer for grant of bail in anticipation of arrest of the petitioner should be declined.

Delay should not come in the way of the Investigating Agency to make custodian interrogation so as to reach to the bottom of the case. In this

context, Mr Salathia, learned AAG, relies upon the judgment of the Apex Court in State Rep. by the C.B.I. Vs. Anil Sharma, in which his

Lordship Hon'ble Mr Justice K.T. Thomas (as his Lordship then was) speaking for the Bench observed that custodial interrogation is qualitatively

more elicitation orientated than questioning a suspect who is well ensconced with a favourable order u/s 438 of the Code. The Apex Court

highlighted that the effective interrogation of a suspected person is of tremendous advantage and also materials which would have been concealed

and success in such interrogation would elude if the suspected person knows that he is well protected and insulated by a pre-arrest bail order

during the time he is interrogated and thus reduce the custodial interrogation to mere ritual.

In another case of State of Andhra Pradesh Vs. Bimal Krishna Kundu and another, the Apex Court refused to uphold and appreciate an order

passed by the High Court granting anticipatory bail to an accused in a case of conspiracy and observed that if the accused in such a case is armed

with an order u/s 438 of the Code, it would greatly harm the investigation and impede the proceedings for unearthing the ramifications involved in

the conspiracy. Their Lordships were of the view that by such an order, public interest would also suffer.

I have heard learned counsel for the parties and gone through the record of the case carefully. I also examined the original record produced by

a team of the officials of the Vigilance Organisation, headed by Mr. R. S. Swain, DIG Vigilance.

The offence allegedly committed by the petitioner pertains to misuse of his official status while functioning as Commissioner/Secretary to

Government of J&K Education Department. The allegation is that the petitioner received kick-back/bribe in order to do favour to the supplier in

regard to supply of jute matting and Ghulam Rasool alias Lassa Vakil acted as middle-man for the petitioner. The offences in respect of criminal

breach of trust, cheating the State, whose interest the petitioner was duty bound to protect, are serious in nature. Moreover, the searches

conducted at the houses of petitioner and other accused persons, have yielded huge amount of cash, FDRs/TDRs etc., totaling about Rs. 75/- lacs

besides possessing other movable and immovable property by the petitioner. It, prima facie, raises a strong suspicion that petitioner has

accumulated unaccounted wealth disproportionate to the known sources of his income. It is only the petitioner who can explain to the Investigating

Authority how he has accumulated such huge assets, both movable and immovable and for this custodial interrogation of the petitioner is must to

collect information and the material which otherwise may remain concealed. Petitioner is also required to de-code the words/messages fed by him

in the computer(s) installed at his residence.

I may observe, that in cases of corruption at high places, an order of anticipatory bail cannot be granted unless very compelling circumstances

are made out for such concession in favour of such accused person.

The Constitution Bench of the Hon'ble Supreme Court in Shri Gurbaksh Singh Sibbia and Others Vs. State of Punjab, cautioned the Court to

exercise its judicial discretion wisely while passing an order u/s 438 of the Code Criminal Procedure (which is parameter to Section 497-A J&K

Criminal Procedure Code), in the following words :-

A wise exercise of judicial power inevitability takes care of the evil consequences which are likely to flow out of its intemperate use. Every kind of

judicial discretion, whatever may be the nature of the matter in regard to which it is required to be exercised, has to be used with due care and

caution. In fact, an awareness of the context in which the discretion is required to be exercised and of the reasonably foreseeable consequences of

its use, is the hallmark of a prudent exercise of judicial discretion. One ought not to make a bugbear of the power to grant anticipatory bail.

For the foregoing reasons, I am of the opinion that in view of serious nature of the offence(s), gravity of the allegations and the result of

searches made in the house(s) of the petitioner and other co-accused and the need of custodial interrogation of the petitioner by the Investigating

Authority, there are no compelling grounds for this Court to exercise its discretion u/s 497A Criminal Procedure Code, 1989 (1933 A.D.) in

favour of the petitioner by allowing this petition and to release him on bail in anticipation of his arrest, in FIR No. 69 of 1999 registered with the

Vigilance Organisation Jammu.

Accordingly, the petition being without any merit is dismissed.