N. Haribhaskar, I.A.S. vs State

M. Karpagavinayagam, J.—Mr. Haribhaskar, I.A.S. (Retired), the Former Chief Secretary of Tamil Nadu, is seeking to set aside the order

dated 18.9.1997 passed in C.C. No. 10 of 1997 issuing summons to him, the Petitioner by the XII Additional Special Judge, Chennai.

The Petitioner after having served for nearly 36 years in the Indian Administrative Service, retired from services with effect from 30.6.1996. On

27.9.1996, the First Information Report was filed for the offences alleged to have been committed in the year 1993 based on the complaint given

by Dr. Subramaniam Swamy, President of Janata Party against the Petitioner and other public servants. After investigation, the charge-sheet was

filed against the persons concerned. The Petitioner has been arrayed as A4.

On receipt of the charge-sheet, the learned Special Judge-cum-XII Additional Judge took the case on file in C.C. No. 10 of 1997 and took

cognizance of the offences under Sections 120B read with 409 and 409 I.P.C. as against the Petitioner and some others holding that no sanction is

necessary for the offence of misappropriation of public funds committed by the public servants u/s 197(1) Code of Criminal Procedure, as laid

down in Shambhoo Nath Misra Vs. State of U.P. and others, and refused to take cognizance of the offences under the Prevention of Corruption

Act as against the Petitioner and some others holding that sanction is necessary even if the public servant has ceased to be a public servant on the

date of taking cognizance of the offence, as laid down in R. Balakrishna Pillai v. State of Kerala (1996 S.C.C. Crl. 128) and issued summons to

the Petitioner in respect of the offences under I.P.C. alone on 18.9.1997 directing the accused to appear before the said Court on 7.10.1997. The

Petitioner on receipt of summons appeared before the Special Court and received the copies.

Being aggrieved of this order of taking cognizance for the offences as referred to above and issuing summons to the Petitioner, the Petitioner has

filed this revision before this Court.

Mr. Mohan Parasaran, the counsel for the petitioner raised the following contentions:-

(1) The Shambhoo Nath''s case as relied upon by the lower Court for taking cognizance for the offences under Indian Penal Code is not applicable

to this case, because the sanction has been obtained u/s 197, Code of Criminal Procedure from the State Government in respect of other public

servants, the co-accused and both in the F.I.R. and the charge-sheet it is mentioned that the offences have been committed by the Petitioner along

with others in the discharge of official duties as public servant and therefore, the sanction u/s 197, Code of Criminal Procedure as regards the

Petitioner also is essential to empower the Court to take cognizance, as there cannot be any discrimination among the public servants. So

cognizance is bad without sanction.

(2) The Special Court has been constituted exclusively to try only offences under the Prevention of Corruption Act committed by the public

servants. Therefore, in the absence of the sanction by the Central Government in relation to the offences under the Prevention of Corruption Act,

the Special Court cannot split up the charges and proceed on with the trial in respect of the offences under the I.P.C. alone.

Per contra, Mr. Shanmughasundaram, the learned Public Prosecutor, would contend that in this case, the sanction had been obtained u/s 197,

Code of Criminal Procedure in respect of the Petitioner also from the State Government on 29.5.1997 and the same has been filed before the

Special Judge on 16.6.1997 and that on 18.9.1997 the learned Special Judge took cognizance for the offences under I.P.C. alone and issued

summons to the Petitioner. Since there is a sanction filed before the Court long prior to the date of cognizance, that is, on 18.9.1997 the

cognizance cannot be said to be invalid, merely because Shambhoo Nath''s case has been referred in the impugned order.

After issue of summons, it is stated that prosecution has filed an application on 20.11.1997 in Crl.M.P. No. 288 of 1997 praying for taking

cognizance of offences against the Petitioner and some others under the Prevention of Corruption Act as well, intimating to the Court the Central

Government''s communication to the effect that no sanction is necessary, as the Petitioner retired from service and he could no longer be a public

servant on the basis of the judgments of the Apex Court.

To put it briefly, the submissions of the learned Public Prosecutor are that the cognizance taken for the I.P.C. offences is valid, as already

sanction was obtained and filed before the Court and that there is no impediment for taking cognizance of the offences under the Prevention of

Corruption Act as well, as the Petitioner has ceased to be a public servant.

The main argument advanced by Mr. Mohan Parasaran, the learned counsel for the Petitioner is that the cognizance taken by the Special Judge

in respect of the offences under I.P.C. is invalid and ab initio void, as there is no sanction obtained u/s 197, Code of Criminal Procedure, though

sanction was obtained as against other public servants.

The immediate reply by the learned Public Prosecutor is, as mentioned above, that the sanction u/s 197, Code of Criminal Procedure had been

obtained on 29.5.1997 and the same had been filed before the Special Court on 16.6.1997 and only thereafter, the cognizance was taken on

18.9.1997.

Some factual details are necessary before dealing with the question posed in this case. This revision has been filed by the petitioner against the

impugned order passed by the learned Special Judge holding that no sanction is necessary for prosecuting the Petitioner for the offence of

misappropriation of public fund by the public servant. However, the learned Public Prosecutor submitted that the prosecution felt that sanction is

necessary and therefore, obtained the same u/s 197, Code of Criminal Procedure and filed it on 16.6.1997 and that the cognizance was taken on

18.9.1997. In order to verify the factual position, this Court called for the original records from the Special Court.

On perusal of the records, it is seen that the assertion made by the learned Public Prosecutor is correct. On the complaint of Dr. Subramaniam

Swamy, the President of Janata Party, against the Former Chief Minister, Ministers and the former Chief Secretaries including the Petitioner, the

learned Principal Sessions Judge, by the order dated 16.8.1996 directed the Director General of Police to investigate the said complaint u/s

156(3), Code of Criminal Procedure through a Special Team to be nominated by him and file the report.

Ultimately, on 2.4.1997 the investigating agency filed a preliminary charge-sheet against the Petitioner and others and requested time for

obtaining sanction, and further investigation.

On 7.5.1997, in view of the constitution of Special Court to try cases like this, the learned Principal Sessions Judge made over this case to the

XII Additional/Special Court for disposal.

On 12.6.1997, the investigating agency filed sanction as regards the former Chief Minister, Ministers and other public servants before the

Special Court.

In the meantime, the investigating agency requested sanction from the State Government u/s 197, Code of Criminal Procedure as against the

Petitioner and other public servants and the same was obtained on 29.5.1997. This was filed before the Special Judge on 16.6.1997.

The learned Special Judge by the order dated 31.7.1997 directed the investigating agency to file final report after completing further

investigation, on or before 20.8.1997.

On 20.8.1997 the investigating agency filed a status report intimating to the Special Court about the sanction obtained earlier in respect of all

the public servants including the petitioner and filed before the Special Court on 12.6.1997 and 16.6.1997 and requested further time for making

further investigation to be done in foreign countries. Again, the investigating agency on 18.9.1997 filed another status report before the learned

Special Judge intimating that the sanction order from the Government of India is awaited for the accused No. 5 Narayanan, I.A.S. (presently

working) and the same is under the consideration of the Central Government and that it would be filed before the Court as soon as it is received.

On the very same day, the Under Secretary of Central Government also filed an affidavit before the learned Special Judge about the process

of consideration relating to the sanction as regards the accused No. 5 Narayanan, I.A.S. and requested time for the same. In the said affidavit, the

Under Secretary specifically mentioned that the sanction under Prevention of Corruption Act as against the Petitioner and another is not required to

be accorded, since they have already retired from services.

Even after filing of the status report and the affidavit by the Central Government, the learned Special Judge took cognizance of the offences in

respect of I.P.C. alone as regards the petitioner and some others and refused to take cognizance in respect of the offences under the Prevention of

Corruption Act for want of sanction as indicated earlier.

Two factors are relevant to be considered in this context.

(1) It is the case of the prosecution that as per the charge-sheet, the petitioner (A4) being a public servant and others in their respective capacities

being entrusted with or having dominion over the funds of TNEB, committed criminal breach of trust in respect of sum of Rs. 3.77 crores being the

excess amount paid to the suppliers per metric tonne of Coal instead of US $ 35.24 prior to earlier offer by the supplier at Singapore and that they

being the public servants entrusted with the responsibility of enforcing the terms of specification has to the size of the Coal to be accepted at the

time of import fail to enforce the same, as a result of which they fail to collect Rs. 2.8 crores which was due to the TNEB and thereby they

committed an offence punishable u/s 409, I.P.C.

(2) After filing of the final report before the Principal Sessions Judge, on 2.4.1997, the investigating agency thought it fit to apply for a sanction u/s

197, Code of Criminal Procedure and sent a letter dated 4.4.1997 to the Government seeking for sanction. On perusal of the records, the

sanctioning authority also by the order dated 29.5.1997 felt that this is a fit case for sanction and accorded the same u/s 197 Code of Criminal

Procedure as against the Petitioner and other public servants. The perusal of the sanction also would disclose that the petitioner disregarded the

cautions and objections raised by Mr. V. Sundaram, the former Secretary of Public Works Department, intimating that the tender would cause

heavy loss to the TNEB, and committed the offences under Ss.120-B and 409, I.P.C, in pursuance of the conspiracy hatched along with the other

public servants thereby causing heavy loss to the Electricity Board.

In the light of the averments in the charge-sheet and the sanction and the stand taken by the investigating agency over the necessity of sanction

by applying for the sanction, obtaining the same and filing before the Court well in advance before the taking of cognizance, the learned Special

Judge ought not to have said that no sanction is necessary, in view of the decision of the Supreme Court in Shambhoo Nath Misra Vs. State of

U.P. and others, wherein it has been observed that ""a public servant alleged to have mis-appropriated public fund cannot be treated as acting in

discharge of duties and as such for prosecuting a public servant who appears to have committed an offence u/s 409, I.P.C. no sanction is

necessary u/s 197(1), Code of Criminal Procedure"" It is not known as to why the Special Judge should take support from Shambhoo Nath

Misra''s case, in order to hold that no sanction is necessary, more particularly when the sanction is very much available in this case.

Therefore, the observation of the Special Judge that no sanction is necessary, is irrelevant and it may not be correct, in view of the facts and

circumstances of this case. However, it would not, in my view, come to the rescue of the Petitioner, as it must be taken that the cognizance is valid,

in view of the fact that the sanction has already been filed before the Court.

The reasoning given in the impugned order may be wrong, in view of the fact situation as referred earlier. However, the final conclusion for

taking cognizance and the issuance of order of summons cannot be said to be illegal, since there is no embargo on the Special Judge to take

cognizance in respect of the offences under Indian Penal Code. against the public servant, as the Special Judge is empowered to take the case on

file on the strength of the sanction u/s 197 Code of Criminal Procedure which had already been filed.

In view of the above situation, the counsel for the petitioner now raises a new point, which is quite interesting and is this: u/s 197, Code of

Criminal Procedure the sanction has to be obtained for prosecution of the offences committed by the public servant only from the Central

Government, since the Petitioner is to be removed only by the Central Government, as he is an I.A.S. Officer having been appointed by the

Central Government. As such, even though the sanction has been obtained from the State Government, and even assuming that cognizance was

taken on such sanction, in the absence of the sanction by the Central Government, the cognizance taken by the Special Judge would be illegal and

the same would vitiate the entire proceedings.

To deal with the above point, it has become necessary to go into the relevant sections. Section 197 Code of Criminal Procedure reads thus:-

Prosecution of Judges and public servants.- (1) When any person who is or was a Judge or Magistrate or a public servant not removable

from his office save by or with the sanction of the Government is accused of any offence alleged to have been committed by him while acting or

purporting to act in the discharge of his official duty, no Court shall take cognizance of such offence except with the previous sanction-

(a) in the case of a person who is employed or, as the case may be, was at the time of commission of the alleged offence employed, in connection

with the affairs of the Union, of the Central Government;

(b) in the case of a person who is employed or, as the case may be, as at the time of commission of the alleged offence employed, in connection

with the affairs of a State, of the State. Government.

(2) ......

(3) .....

(4) .....

According to the counsel for the Petitioner, the Petitioner, who was a member of All India Service, could be removed only by the Central

Government and therefore, u/s 197, Code of Criminal Procedure the sanction has to be obtained only from the Central Government, which alone

could remove him from service, and as such, the sanction u/s 197, Code of Criminal Procedure from the State Government would not, in any way,

save the prosecution.

Arguing contra, the learned Public Prosecutor would submit that the question of competency with regard to the removal of public servant

would only apply to Section 19 of the Prevention of Corruption Act and that is the reason why the prosecution applied for sanction with reference

to the offences under the Prevention of Corruption Act u/s 19 from the Central Government, that this would not, however, apply to Section 197,

Code of Criminal Procedure, as this would relate to the sanction by the Government in the affairs of whom, the public servant is employed at the

time of commission of the offence and that in the instant case, sanction for prosecution against the Petitioner, who committed the offences, while he

was employed under the State Government, was validly obtained from the State Government.

Let us, now, have a look at Section 19 of the Prevention of Corruption Act. Section 19 provides thus:-

Previous sanction necessary for prosecution:- (1) No court shall take cognizance of an offence 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 removable from his office save by or with the

sanction of the State Government;

(c) in the case of any other person, of the authority competent to remove him from his office.

(2) Where for any reason whatsoever any doubt arises as to whether the previous sanction as required under Sub-section(1) should be given by

the Central Government or the State Government or any other authority, such sanction shall be given by that Government or authority which would

have been competent to remove the public servant from his office at the time when the of-fence was alleged to have been committed.

(3) ......

(4) ......

The combined reading of Section 197, Code of Criminal Procedure and Section 19 of the P.C. Act would make out the following differences:-

(1) u/s 197 Code of Criminal Procedure, when any person who is or was a Judge or a Magistrate or a public servant is accused of any offence

committed in the discharge of his official duty, the Court can take cognizance only on the basis of the previous sanction. But, u/s 19 of the P.C.

Act, the sanction is essential to prosecute a person who is a public servant for the specified offences under Sections 7, 10, 11, 13 and 15 of the

Prevention of Corruption Act.

(2) S.197, Code of Criminal Procedure provides for the granting of sanction for any offence alleged to have been committed while acting in the

discharge of official duty by the Central Government against a person who is employed or was employed at the time of commission of the alleged

offence, in connection with the affairs of the Union; or by the State Government, if such person is employed or was employed at the time of

commission of the offence in connection with the affairs of the State. But, Section 19(2) of the P.C. Act provides that whenever doubt arises as to

whether previous sanction should be given by the Central Government or State Government, such sanction shall be given by that Government,

which would have been competent to remove the public servant from his office.

It should be noted that the analogous provision as contained in Section 19(2) of the P.C. Act is absent in Section 197 Code of Criminal

Procedure The reading of Section 197 Code of Criminal Procedure also would make it clear that competency of the removal is not the main

criteria in Section 197, Code of Criminal Procedure, as is provided in Section 19(2) of the P.C. Act. The perusal of Section 197 Code of Criminal

Procedure further discloses that a person can be prosecuted even diough he is a public servant without obtaining sanction u/s 197, Code of

Criminal Procedure from the Government provided, he is not removable from his office by the Government.

For instance, a Constable or a Sub-Inspector of Police or an Inspector of Police is removable by the Inspector General of Police or

Superintendent of Police and as such, they are not removable by the Government.

So, the wordings of Section 197(1) Code of Criminal Procedure would go to show that the offences committed by the public servant

removable by the Government alone would attract Section 197, Code of Criminal Procedure In other words, the offences committed by the public

servants who are not removable by the Government and who are removable even by the subordinate authority do not derive the benefits accrued

u/s 197,Code of Criminal Procedure.

Therefore, the question of competency of removal does not arise in Section 197, Code of Criminal Procedure to decide about the authority

who can grant sanction. The only criteria as contained in Section 197, Code of Criminal Procedure regarding the competency of the authority

granting sanction is as to whether the person who committed the offence was employed in connection with the affairs of the Union or the State. If

the commission of the offence is in connection with the affairs of the State, the State Government has to grant sanction. Similarly, if it is committed

in connection with the affairs of the Union, the Central Government has to grant sanction. But, this concept would not be applicable, as correctly

pointed out by the learned Public Prosecutor, to Section 19(2) of the P.C. Act, as it would relate to the powers of granting sanction by the

authority who is competent to remove the public servant concerned.

Admittedly, the petitioner was employed under the State Government during the relevant period in which the offence alleged to have been

committed by him. It is the case of the prosecution that during the course of his discharge of official duties as a State Government Officer, in

connection with the affairs of the State, he committed the above said offences. Therefore, in my view, the sanction has been obtained from the

competent authority and the same has been filed before the Special Court and therefore, the cognizance taken in this case was valid in law.

To arrive at such a conclusion, I find support from the decision of the Apex Court in R.R. Chari Vs. State of U.P., It is a case where die

appellant Chari was an employee under the Government of Assam and latter his services were lent to the Government of India. Before he had

been reverted back to Assam Government, with reference to the offences committed when he was employed in the affairs of the Central

Government, he was arrested and charge-sheet was filed along with the sanction for prosecution of the Appellant u/s 197 Code of Criminal

Procedure accorded by the Government of India in respect of the offences under Ss.120-B, 467, etc. of I.P.C. An objection was raised

questioning the validity of the sanction u/s 197 Code of Criminal Procedure obtained from the Central Government stating that the Appellant,

though he had been loaned by Assam Government to Government of India, he was a person permanently employed in connection with the affairs

of the State and the State Government of Assam alone is competent to accord sanction. This objection has been rejected by the Apex Court

holding that what is relevant for the purpose of deciding as to who should give the sanction u/s 197 Code of Criminal Procedure, is to ask the

question; where is the public servant employed at the relevant time? The Apex Court would hold that if he is employed in the affairs of the

Federation, it must be the Governor-General, in spite of the fact that such employment is temporary and that the services of the public servant have

been loaned by the State Government to Government of India.

In the above case, both the sections, namely, Section 197 Code of Criminal Procedure and Section 6 of the Prevention of Corruption Act,

1947 (presently Section 19 of the P.C. Act, 1988) have been considered, while venturing to answer the similar question raised in this case. The

relevant observation is as follows:-

It would be noticed that the scheme of this section (S.6 of the P.C. Act) is different from that of Section 197 of the Code of Criminal Procedure.

The requirement of the first part of Section 197(1) which constitutes a sort of preamble to the provisions of Section 197(1)(a) and (b) respectively

has been introduced by Section 6 severally in Cls.(a) and (b). In other words, under Cls.(a) and (b) of Section 197 (1) the authority competent to

grant the sanction is determined only by reference to one test and that is the test provided by ""the affairs in connection with which the public servant

is employed"", if the said affairs are the affairs of the Federation, the Governor-General grants the sanction; if the said affairs are the affairs of a

Province, the Governor grants the sanction That is the position u/s 197(1) as it then stood. The position u/s 6 of the Prevention of Corruption Act

is substantially different. Clauses (a) and (b) of this section deal with persons permanently employed in connection with the affairs of the Federation

or in connection with the affairs of the Province respectively, and in regard to them, the appropriate authorities are the Central Government and

Provincial Government.

In K.N. Shukla Vs. Navnit Lal Manilal Bhat and Another, , a similar question has been considered. In that case, a Railway Officer appointed

by the Central Government was sent to the Railway Board to hold the position as Officiating Class-I Officer. When a complaint was filed against

him for the offences under Sections 166, 167 and 192, I.P.C, a preliminary objection was raised on the ground that the said person was

removable by the Central Government and so the complaint should be rejected, because there was no sanction granted u/s 197 Crl.PC. This

objection was rejected as devoid of merits by the Apex Court by making the following observation:-

If once the Central Government has delegated its power to another authority with regard to appointment and removal of a public servant, then for

the purpose of Section 197, Code of Criminal Procedure, the public servant concerned will not be treated to be a public servant ""not removable

from his office except by or with the sanction of the Central Government"" within the meaning of that section.

Looking at the above angle, if we consider the question whether the Petitioner is removable by the State Government or Central Government,

Section 19 of the P.C. Act, 1988 alone would be a relevant section to decide about the same. But here in this case, as we have indicated above,

at the relevant time, the Petitioner admittedly was a person employed in connection with the affairs of the State and therefore, it is the State

Government alone that would be competent to accord sanction u/s 197 Code of Criminal Procedure.

However, yet another disturbing feature that I could notice in the impugned order is the observation made by the Special Judge that sanction is

necessary even if the public servant ceased to be public servant on die date of taking cognizance of the offences under the P.C. Act. To give such

a finding, the learned Special Judge has relied upon the decision in 1996 S.C.C.(Crl.) 128 (supra). In fact, the said decision of the Apex Court

does not give such a finding.

In the said decision, the Apex Court held that sanction is necessary u/s 197 Code of Criminal Procedure even if the public servant ceased to

be public servant on the taking of the cognizance. It does not refer to the sanction u/s 19 of the Prevention of Corruption Act. This observation

also is wrong.

However, as referred to earlier, the investigating agency has filed an application in Crl.M.P. No. 288 of 1997 requesting the Special Judge to

take cognizance of the offences under the Prevention of Corruption Act even without the sanction, on the strength of the decision in K.

Veeraswami v. Union of India (1991 S.C.C.(Crl.) 734) in which it is held that no sanction for prosecution of the accused under Prevention of

Corruption Act was necessary, since he had retired from service on attaining the age of superannuation and was not a public servant on the date of

taking cognizance.

It is settled law, as admitted by the counsel for the Petitioner herein, that there is no bar for taking cognizance of the offence under the

Prevention of Corruption Act without sanction, once when the accused has ceased to be a public servant. Therefore in my view, there will be no

difficulty nor any impediment for the Special Court to take cognizance for the offences under the Prevention of Corruption Act as well. In fact, in

my view, the learned Special Judge ought to have taken cognizance of those offences even on the date, that is, on 18.9.1997, when he took

cognizance for the offences under I.P.C. So in view of the above legal position, the learned Special Judge could dispose of the application in

Crl.M.P. No. 288 of 1997 filed by the prosecution on 20.11.1997, in accordance with the law.

For the foregoing discussion, I am of the view that the cognizance which has been taken in this case must be construed to be valid, in view of

the fact that the sanction u/s 197 Code of Criminal Procedure from the competent authority has already been filed and consequently, it cannot be

said that the order issuing summons to the Petitioner is liable to be set aside, as in my considered opinion, the impugned order taking cognizance

and issuing summons is perfectly valid in law.

In the result, the revision is dismissed. Consequently, Crl.M.P. No. 6410 of 1997 stands dismissed. The Registry is directed to send the

records to the Special Court immediately.