Smt. Neera Yadav vs C.B.I. (Bharat Sangh)

Ajoy Nath Ray, C.J.—Several cases have come up before us for the purpose of completely quashing certain prosecutions which are the

subject matter basically of four criminal cases.

The reason why we dictate this common judgment will appear hereafter. Several facts are interconnected and common and so are several points

of law including the extremely important one of obtaining of sanction for prosecution u/s 197 of the Code of Criminal Procedure.

The genesis of the criminal cases is this. It is well known that in NOIDA the State of U.P., has, by setting up a statutory authority called the

NOIDA Industrial Development Authority under the U.P. Industrial Area Development Act, 1976, caused development and distribution of several

plots of land. These plots are for different types of intended use. There are residential plots, parks or open spaces, industrial areas as well as areas

intended for the service of residents, namely shops and nursing homes.

In regard to the allotment of NOIDA land, which is well known to have been valuable at all material times and very valuable now, a public

interest litigation was filed before Supreme Court of India alleging unfairness and partiality made in the matter of allotment of plots. On or about

20.1.1998, the Supreme Court passed an order directing the authorities set up under the Delhi Special Police Establishment Act 1962 more

commonly known as the C.B.I., to investigate into the allotment of 36 plots of land. Such investigation was undertaken. The Court had further

directed launching of prosecutions and departmental inquiries on the basis of the investigation, if such were called for. Some 15 cases were

identified for proceeding departmentally and four legal persons have been pinpointed by the C.B.I. for prosecuting in the Criminal Court.

These four persons are:- (i) Smt. Neera Yadav, (ii) Sri Rajiv Kumar, (iii) Dr. Mahesh Prasad in regard to his undertaking of the Nursing Home

called Kailash Hospital and (iv) two Flax Groups of Companies of which one Ashok Chaturvedi is the Chairman-cum-Managing Director.

Although the First Information Report filed by the C.B.I. in or about the year 1998 was one and single, it branched out into four different

criminal cases in regard to four completely separate plot or set of plots.

Although learned counsel have taken a lot of time in identifying the numbers of these cases with the plots, such clerical exercise is not very

necessary. Once the substance of the dispute is resolved, the orders can be passed sufficiently clearly without paying being too much attention to

the numbers.

In each of the cases Km. Manju Rani Gupta presiding over Special Court, i.e. acting as the Special Judge, C.B.I. has found, on the basis of

materials tendered before her that the stage is right and proper for the purpose of taking cognizance and for the purpose of issuing summons for the

onward preliminary stage of trial, i.e. the stage of framing of charges.

It is at this stage that these matters principally invoking Sections 401, 482 and 483 of the Criminal Procedure Code have been heard by us. At a

previous stage, the High Court had been approached and by way of an interim order the arrest of the persons complained against had been stayed.

This time the applicants ask for total quashing.

Before we give as briefly as possible the well known and simple law about quashing of proceedings even before they get under way, it is

important to recount the very broad facts of the four groups of cases. We state those facts below without trying too hard to distinguish between

which side highlighted which fact. This matter should be obvious from the facts themselves.

The first group includes Smt. Neera Yadav and Rajiv Kumar; both of them are I.A.S. officers and public servants within the meaning of

Section 197 of the Code of Criminal Procedure not removable save by the sanction of the Central Government. The case concerns the allotment

of one plot to Rajiv Kumar. The initial lottery allotting land to Rajiv Kumar is not under challenge. It is said however, that he was first allotted land

in Sector 51 but that he immediately made an application for being shifted to Sector 14-A. This Sector is a prime Sector. No land was regularly

available in this Sector to be allotted to Rajiv Kumar, but nonetheless he got land in this Sector. A Rule that two conversions from one plot to

another plot will not be permitted was broken to accommodate Rajiv. He was first shifted to Sector 44 on his application for change but he

pressed with his desire for Sector 14-A and no other Sector. To accommodate Rajiv, Neera approached the Chief Architect and Planner one

S.P. Gautam to change the very land use plan of Sector 14-A.

The further allegation is that this change was effected and plots 26, 27 and 28 in this Sector were affected thereby. Since no land was available

in Sector 14-A an area earmarked for a guest house was reduced so that Rajiv might get his plot. Rajiv came into Sector 14-A in plot no. 27 and

then he himself contacted one A.K. Goel an officer of NOIDA, to add on to his plot a further strip of 150 sq. meters, which was done. As a result

Rajiv Kumar became the allottee of big plot of a big plot of land more than 500 sq. meters in area being plot no. 27 of Sector 14-A.

The second case concerns Smt. Neera Yadav herself and her two daughters Suruchi and Sanskriti. The daughters are not prosecuted; there is

a third daughter, Sruti who does not figure in the facts at all. The allegation is that Neera obtained the benefit of participating in the lottery to be

held in the 1st week of April 1994 by breaking rules in her own favour. Although the last date for payment of the deposit money was the well

known ides of March, she gave a cheque of that date which reached the Bank only on the 28th of March and was deposited into the NOIDA

account on the 30th . Payment by cheque was not the rule but only by Bank draft. There is evidence by one G.C. Tiwari of NOIDA that he saw

the cheque of Neera dated 15th of March on that date, but she had taken the cheque away.

After participation in the lottery, she also duly won, but there is no challenge to that. She did not get a plot in Sector 14-A. She also wanted a

plot for herself in Sector 14-A; by change of the land use plan as mentioned before plot no. 26 of 562 sq. meters was produced as a corner plot

which was allotted to Neera, who at that time was filling the dual capacity of both the Chairman and the Chief Executive Officer of the NOIDA

authority.

Rajiv Kumar was the Deputy Chief Executive Officer of NOIDA. It was said that land conversion was nothing out of way; that when one Ravi

Mathur was the Chairman of NOIDA before Neera there had been no fewer than 250 conversions of plots It was urged that Neera was being

singled out and prosecuted.

In support of such singling out, mention was made that plots had also been allotted to Jayant Adwani, to a son of one Subramanyam, who was

the Cabinet Secretary, the name of the son being Sitapati, that the very daughter of the C.B.I. Director, Kartikeyan was also favoured with a plot

of land but, it was said the C.B.I. found no evidence for prosecution in this regard but Neera alone was proceeded against.

In the case against Neera for self-help by abusing her official position, her two daughters are also included. They are Suruchi and Sanskriti. It

was said that because they would not be entitled to plots on their own being part of the same family, they were at first allotted shops in the NOIDA

area. Neera''s defence was that she had nothing to do with this lottery allotment and the lottery is not challenged. The C.B.I.''s case is that the two

shops were got declared as functional even though Suruchi was at that time studying in Glasgow and Sanskriti was studying at that time in

Kirorimal College in New Delhi. The advantage of declaration of functionality was that the shops could be exchanged for plots. This exchange was

duly performed; one of the daughters got a plot in Sector 44 and another daughter elsewhere but the employees of the NOIDA authority duly

changed the other daughter to Sector 44 also so as to make them happy neighbours.

Arguments were made that Suruchi and Sanskriti were not part of the same family by reason of their being independent adults with income tax

returns filed on their behalf; the taxable returns of income in the relevant financial year being respectively of the order of Rs. 1, 65,000/- and Rs.

67,000/-.

The third case involves Neera Yadav and Dr. Mahesh Prasad who has built a Hospital called Kailash Hospital in NOIDA. The Hospital had

been built on land exceeding 4100 sq. meters. Although before Neera had assumed office on the 8th January, 1994, Dr. Mahesh Prasad had been

allotted 2925 sq. meters of land yet during Neera''s tenure up to 8th November, 1995, he was favoured with the vital additional 1225 sq. meters

of land. With this additional land, his original application asking for more than 4000 sq. meters was fully met, but this additional area was not made

normally available to him, but by abusing of Neera''s position. Three plot holders S.K. Agarwal, Zameel Ahmad and Jagat Pal were shifted from

the adjoining areas and a park area was also shrunk for the purpose of accommodating Kailash Hospital again. The land use plan was changed by

S.P. Gautam at the instance of Neera Yadav. Although for Nursing Home the price for the plot would be at the Rs. 2750/- per sq. meter, yet for

the Nursing Home in this case, there was a reduction made to Rs. 2000/- per sq. meter by the Board at the instance of Neera Yadav. The

reduction was made without any application for reduction by the Hospital in question. The benefit to the Hospital by reason of this reduction was

of the order of Rs. 31 lacs.

On behalf of Neera, it was submitted that the decision for reduction was taken by the Board. That she had merely put up the note on which the

Board acted although she was in the Chair of the Board; the Board was not a puppet in her hands, but there were no fewer than five members in

the Board, who were senior to her. If the Board reduce the price, then it was contrary to law to catch Neera without catching the entirety of the

Board.

The fourth case concerns the Flax Groups of Industries. The allegation is that two concerns of Flax were benefited to the extent of Rs. 1.12

crore by a price reduction again caused by Neera. The matter is alleged to have happened in this way. The price fixed at first was Rs. 1600/- per

sq. meter; there were two additional conditions that the investment of the Company had to be equal to or above Rs. 30 crore and that the annual

turnover of the applicant''s Company had to be equal to or above Rs. 10 crore. On the basis of these requirements, applications were received

from six concerns out of which only two qualified of which the Flax Group was one; without there and then processing the application and allotting

land to Flax at the rate of Rs. 1600/-, Smt. Neera Yadav got the Board to meet in August, 1994 for reducing the price of the land as well as for

relaxing the conditions of fulfilment. There was no necessity of doing all these; at least the price reduction was no way called for; even the

relaxation of the other two requirements might have invited more eligible Industries. The Board as usual agreed with Neera. She was naturally again

in the Chair. On the basis of these relaxations, two advertisements were issued, one in a Sahara publication on 19.10.1994 and another in the

Times on 21.10.1994. These advertisements have been produced in Court and these are corner insertions without a single particular about either

the original condition or the relaxation or the price. Nonetheless it is submitted by Flax that they being original applicants, they made inquiries in the

office of NOIDA as soon as the publication of 19.10.1994 was seen and they received information. Thus, on 21.10.1994, the Flax Group gave to

Smt. Neera Yadav an application in the most cursory of manner on plain paper without using the prescribed form and attaching therewith a cheque

for the total land at the reduced price of Rs. 1200/-; that Smt. Yadav processed the application even before the new Scheme opened on

22.10.1994. On the opening of the Scheme, the first thing that was done was allotment to Flax. The allegation is that she benefited them by her

deed and action monetarily.

When we are concerned with mere quashing of proceedings, i.e. the question whether to stop the proceedings altogether even before those

have began and not to let those go on, the considerations are very simple. The Court will not enter into a detailed scrutiny. For all the four groups

of cases above, we have been occupied morning and afternoon for about 6-7 days and usually detailed scrutiny when the trial is underway will

take much longer. Although details are not necessary, yet some grip over the facts is. Once the basic facts and accusations are understood, the

Court should see whether there is some reasonable material, even if the same be slight or even very slight, on the basis of which the prosecution

can be allowed to start without it being called as a harassing procedure and continued for the purpose of harassment and vexations only. Smt.

Neera Yadav and Rajiv Kumar have been prosecuted under the Prevention of Corruption Act and Dr. Mahesh Prasad and Ashok Chaturvedi are

alleged conspirators u/s 120B of the Indian Penal Code. We have to ask ourselves this simple question that on the basis of the above facts, are

they being harassed and only being harassed by these proceedings? The simple answer is quite clearly and categorically in the negative. On the

basis of preliminary facts therefore the applications must all fail.

However, there is a point of law of the first importance which, though in one sense ""technical"", cannot simply be passed over, because it is a

matter of jurisdiction.

The point arose in this way; both Neera Yadav and Rajiv Kumar are public servants of the Central Government in the sense that they cannot

be dismissed without the sanction of that Government. The matters for which they are prosecuted are all matters, which were undertaken and

performed by them in course of their official duty when working in NOIDA; also the actions were in connection with the affairs of the State

Government. Section 197 of the Code of Criminal Procedure is set out below, but not the whole of it because we are concerned only with the first

part of the said section, i.e. Sub-section (1) thereof up to before the commencement of the proviso:-

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, was at the time of commission of the alleged offence employed, in connection

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

Sanction from the State Government was sought for prosecuting Neera and Rajiv for offences mentioned and made punishable under the

Indian Penal Code including Section 120B thereof, but the State Government has categorically refused sanction.

Counsel for both parties have upto now or at least until yesterday proceeded on the basis that sanction u/s 197 would be required for crimes

described in the Indian Penal Code, but that for crimes mentioned in the Prevention of Corruption Act, 1988 Section 197 would not be the ruling

section. The impression was that in that case the ruling Section would be Section 19 of the said Act, the whole of which is set out below:-

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 removable from his office save by or with 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.

(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 offence was alleged to have been committed.

(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 the 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) no Court shall stay the proceedings under this Act on the ground of any error, omission or irregularity in the sanction granted by the authority,

unless it is satisfied that such error, omission or irregularity has resulted in a failure of justice;

(c) no Court shall stay the proceedings under this Act on any other ground and no Court shall exercise the powers of revision in relation to any

interlocutory order passed in any inquiry, trial, appeal or other proceedings.

(4) In determining under Sub-section (3) whether the absence of, or any error, omission or irregularity in, such sanction has occasioned or resulted

in a failure of justice, the Court shall have regard to the fact whether the objection could and should have been raised at any earlier stage in the

proceedings.

Explanation.- For the purposes of this section,-

(a) error includes competency of the authority to grant sanction;

(b) a sanction required for prosecution includes reference to any requirement that the prosecution shall be at the instance of a specified authority or

with the sanction of a specified person or any requirement of a similar nature.

When the Central Government was approached u/s 19(1)(c) for sanction, they granted the same.

As such, the arguments ran that as far as Section 120B of the I.P.C. was concerned, Neera and Rajiv were out since 197 sanction had not

come.

However, so far as Section 13 of the Prevention of Corruption of Act was concerned, the Section 19 sanction having come, neither Neera nor

Rajiv could escape, at least, minimally speaking, so far as Section 13(1)(d)(ii) is concerned. The said Section 13 is set out below:-

Criminal misconduct by a public servant.- (1) A public servant is said to commit the offence of criminal misconduct, -

(a) if he habitually accepts or obtains or agrees to accept or attempts to obtain from any person for himself or for any other person any gratification

other than legal remuneration as a motive or reward such as is mentioned in Section 7; or

(b) if he habitually accepts or obtains or agrees to accept or attempts to obtain for himself or for any other person, any valuable thing without

consideration or for a consideration which he knows to be inadequate from any person whom he knows to have been, or to be, or to be likely to

be concerned in any proceeding or business transacted or about to be transacted by him, or having any connection with the official functions of

himself or of any public servant to whom he is subordinate, or from any person whom he knows to be interested in or related to the person so

concerned; of

(c) if he dishonestly or fraudulently misappropriates or otherwise converts for him own use any property entrusted to him or under his control as a

public servant or allows any other person to do so; or

(d) if he, -

(i) by corrupt or illegal means obtains for himself or for any other person any valuable thing or pecuniary advantage; or

(ii) by abusing his position as a public servant, obtains for himself or for any other person any valuable thing or pecuniary advantage; or

(iii) while holding office as a public servant, obtains for any person any valuable thing or pecuniary advantage without any public interest; or

(e) if he or any person on his behalf, is in possession or has, at any time during the period of his office, been in possession for which the public

servant cannot satisfactorily account, of pecuniary resources or property disproportionate to his known sources of income.

Explanation: For the purposes of this section, ""known sources of income"" means income received from any lawful source and such receipt has

been intimated in accordance with the provisions of any law, rules or orders for the time being applicable to a public servant.

(2) Any public servant who commits criminal misconduct shall be punishable with imprisonment for a term which shall be not less than one year but

which may extend to seven years and shall also be liable to fine.

Since Dr. Mahesh Prasad and Ashok Chaturvedi are not public servants, they were being proceeded against, inter alia, u/s 120B of the I.P.C.

The question arose from this Court yesterday that in a case like the present whether a public servant dismissable by the Central Government is

doing State Government work, whether sanction for prosecution in regard to the Prevention of Corruption Act offences were needed both u/s 197

of the Code of Criminal Procedure and u/s 19(1)(c), i.e. in cases of this nature involving persons like Neera and Rajiv.

That counsel for the applicants before us was at least until yesterday ready to concede, if not he had not already conceded that 197 sanction is

not needed for a P.C. Act, prosecution is neither here nor there. It is a point of first and paramount importance involving jurisdiction; it cannot be

passed over. It has to be decided and decided as a legal point. It will not do during the decision of this point to think how guilty possibly Neera or

somebody else might be and that the decision one way or the other might allow a guilty person to escape without any punishment. Such a

procedure would be a sort of trap for the Court to fall into the well known old saying that wife good facts make bad law.

The point that a second sanction u/s 197 might be needed just about arose and got mentioned in the case of R. Balakrishna Pillai Vs. State of

Kerala, . In the last sentence of the second paragraph of the judgment, it is noted that in regard to an offence punishable under the old Section 5(2)

read with Section 5(1)(d) of the Prevention of Corruption Act (the old Section 5 corresponding to the new Section 13) their Lordships were not

concerned, because it was not contended by counsel, whatever sanction u/s 197 of the Code was also needed. There being no contention and no

argument and no decision, the case does not help us on this point either this way or the other.

Numerous authorities have been searched into by the learned counsel and also as far as both of us on this Bench are concerned, but a binding

authority directly to the point is not there. The matter has to be decided on first principles as a res Integra always has to be.

The reasons why I am of the opinion that an additional sanction u/s 197 is a must are given below.

First, the word ''offence'' is defined in the Code of Criminal Procedure and the definition section is Section 2(n).

The said definition is set out below:-

(n). ""offence"" means any act or omission made punishable by any law for the time being in force and includes any act in respect of which a

complaint may be made u/s 20 of the Cattle-trespass Act, 1871 (1 of 1871).

It should be mentioned that the section does not give a compulsory definition, but a definition to be adopted unless the context otherwise

requires. The definition encompasses any act or omission made punishable by any law and is not limited to the actions or omissions made

punishable by the Indian Penal Code alone. In Section 197, the bar of cognizance is made applicable in respect of any public servant, who is

accused of any offence. It has not been pointed out as to why the word ''offence'' here should be read differently than as defined in Section 2(n).

We cannot find any reason for taking that unusual different definition in, this context either.

Secondly, there are no words in the first Sub-section of Section 19 of the Prevention of Corruption Act, 1988, which would indicate that the

said Sub-section would apply either in supersession of or in substitution of any part or portion of the Code of Criminal Procedure. Thus, according

to normal rules of construction neither Section 197 is to be treated as erased out by Section 19(1) nor the other way round.

Thirdly, the exclusion of the Code of Criminal Procedure is expressly mentioned in the very same Section 19 later on in Sub-section (3). It

would require very strong reasons for a Court to imply the words notwithstanding any thing contained in the Code of Criminal Procedure, 1973 in

Sub-section (1), when the words are not there and the very words are there in just a later Sub-section of the same Section 19.

Fourthly, the Sub-section (3) of Section 5 is particularly to be noted. Since the Sub-section makes reference to the earlier two Sub-sections,

Sub-sections (1), (2) and (3) of Section 5 are all set out below:-

Procedure and powers of special Judge.- (1) A special Judge may take cognizance of offences without the accused being committed to him for

trial and, in trying the accused persons, shall follow the procedure prescribed by the Code of Criminal Procedure, 1973 (2 of 1974), for the trial of

warrant cases by the Magistrates.

(2) A special Judge may, with a view to obtaining the evidence of any person supposed to have been directly or indirectly concerned in, or privy

to, an offence, tender a pardon to such person on condition or his making a full and true disclosure of the whole circumstances within his

knowledge relating to the offence and to every other person concerned, whether as principal or abettor, in the commission thereof and any pardon

so tendered shall, for the purposes of Sub-sections (1) to (5) of Section 308 of the Code of Criminal Procedure, 1973 (2 of 1974), be deemed to

have been tendered u/s 307 of that Code.

(3) Save as provided in Sub-section (1) or Sub-section (2), the provisions of the Code of Criminal Procedure, 1973 (2 of 1974), shall, so far as

they are not inconsistent with this Act, apply to the proceedings before a special Judge; and for purposes of the said provisions, the Court of the

special Judge shall be deemed to be a Court of Session and the person conducting a prosecution before a special Judge shall be deemed to be a

public prosecutor.

Sub-section (3) mentions that unless the provisions of the Code of Criminal Procedure are inconsistent with the Act, the provisions will apply

to the proceedings before the special Judge. There is nothing inconsistent between Section 197 and Section 19; Section 19 merely requires an

additional sanction. The grant or withholding of an additional sanction under either Section 19 or Section 197 is not necessarily controlled or

guided by the grant or withholding of such sanction under the other section. Thus, Sub-section (3) can be read as a specific provision, which by its

express words makes Section 197 applicable even to offences under the Prevention of Corruption Act.

The appointments of special Judges and cases triable by special Judges are mentioned in Sections 3 and 4 of the Prevention of Corruption Act.

Those sections are set out below. -

Power to appoint special Judges, -(1) The Central Government or the State Government may, by notification in the Official Gazette, appoint as

many special Judges as may be necessary for such area or areas or for such case or group of cases as may be specified in the notification to try the

following offences, namely:-

(a) any offence punishable under this Act; and

(b) any conspiracy to commit or any attempt to commit or any abatement of any of the offences specified in Clause (a).

(2) A person shall not be qualified for appointment as a special Judge under this Act unless he is or has been a Sessions Judge or an Additional

Sessions Judge or an Assistant Sessions Judge under the Code of Criminal Procedure, 1973 (2 of 1974).

Cases triable by special Judges.- (1) Notwithstanding any thing contained in the Code of Criminal Procedure, 1973 (2 of 1974), or in any other

law for the time being in force, the offences specified in Sub-section (1) of Section 3 shall be tried by special Judges only.

(2) Every offence specified in Sub-section (1) of Section 3 shall be tried by the special Judge for the area within which it was committed, or, as the

case may be, by the special Judge appointed for the case, or, where there are more special Judges than one for such area, by such one of them as

may be specified in this behalf by the Central Government.

(3) When trying any case, a special Judge may also try any offence, other than an offence specified in Section 3, with which the accused may,

under the Code of Criminal Procedure, 1973 (2 of 1974), be charged at the same trial.

(4) Notwithstanding any thing contained in the Code of Criminal Procedure, 1973 (2 of 1974), a special Judge shall, as far as practicable, hold the

trial of an offence on day-to-day basis.

These are set out only because the Code of Criminal Procedure is mentioned many times in these sections showing the importance of the

absence of such mention in Section 19(1) and the continued applicability of Section 197 even for the special Judges and even with regard to cases

triable by special Judges.

Fifthly, the Code of Criminal Procedure is a general Act, like the Code of Civil Procedure. Just because the acts are entitled as procedural

acts, they are not necessarily all procedural; they can and very often do largely determined and affect parties'' rights and liabilities. The Code of

Criminal Procedure is also almost as general as the Indian Evidence Act. The special Judges might be trying offences under the Prevention of

Corruption Act, but they have not been and perhaps could not be put above the general laws, which circumscribe the procedure for finding an

accused guilty. A prohibited confession is as unusable by an ordinary Judge presiding over an ordinary Criminal Procedure Code Court as it is

unusable by a special Judge presiding over a Prevention of Corruption Act Court. On general principles the laws requiring strict compliance by

criminal Courts, like the laws governing preliminary sanction, should be applicable to all Courts, which can punish citizens found guilty of crime and

all Courts, which can find such citizens guilty of crime. Sanction u/s 197 falls in such a general category strict law. It has been there for a very long

time and the reason for its existence will soon be examined by us. On general principles therefore, Section 197 is to be held at first blush as

obviously applicable to a corruption Court unless there are strong reasons to indicate its inapplicability.

The next reason i.e., sixthly deals with authorities and the purpose of existence of Section 197. The two great rules of construction are that

primarily the Court should look at the language of the Section or Sections involved and then the Court should look at the purpose for which the

Section has been inserted. The purpose is to be gathered from a whole reading of all the material Acts concerned These days even Hansard, i.e.

pre legislation proceedings can be looked into.

One of the old authorities is a decision of the judicial Committee in the case of AIR 1948 82 (Privy Council) Sir John Beaumont spoke for the

judicial Committee and as is well known an act of England forbids the Privy Council from giving more than one opinion in its judgment. Four Privy

Councilors; sat on the Bench in that case and they were concerned, inter alia, with Clause 18 (2) of the Cotton Cloth and Yarn (Control) Order,

1943. Clause 23 of that Order required a special order for institution of a prosecution.

Sanctions for prosecution and provisions in that regard are not contained merely in the Indian Penal Code and the Prevention of Corruption

Act, 1988. The dicta in this case are reproduced in the case of Mansukhlal Vithaldas Chauhan reported at 1997 S.C.C. (Cri) 1120; an extract

from the opinion of the judicial Committee is to be found at page 15 of the said judgment.

With respect, we would like to re-quote that portion of the decision of the judicial Committee:-

In Gokulchand Dwarkadas Morarka v. King it was pointed our that:

... The sanction to prosecute is an important matter; it constitutes a condition precedent to the institution of the prosecution and the Government

have an absolute discretion to grant or withhold their sanction. They are not, as the High Court seem to have thought, concerned merely to see that

the evidence discloses a prima facie case against the person sought to be prosecuted. They can refuse sanction on any ground which commends

itself to them, for example, that on political or economic grounds they regard a prosecution as inexpedient. Looked at as a matter of substance it is

plain that the Government cannot adequately discharge the obligation of deciding whether to give or withhold a sanction without a knowledge of

the facts of the case.

(emphasis supplied)

It was later observed by the Privy Council as follows: It was not disputed that if the sanction was invalid, the trial Court was not a Court of

competent jurisdiction, ....

The argument was advanced by Mr. Megaw, as the later Hon''ble Lord Justice then was, that the lack of sanction could be cured by

application of the then Section 537 of the Code of Criminal Procedure which is practically identical to Section 465 of the present Code. The

argument was that the lack of sanction or the failure of the Crown to prove the facts on which the sanction was granted amounted to no more than

an irregularity. This view was firmly repelled by their Lordships (see right column of page 85 of the judgment).

The reason for not granting sanction is therefore not limited to prevention of merely vexatious or oppressive proceedings. The reasons can be

economic and political also.

If we might venture amidst these high and binding authorities to risk our own opinion here, we would say that when a Government servant is

dealing with the affairs of one state, he is not his own master, as, at least until now, Hon''ble Judges of the High Courts and the Supreme Court of

this Country are the Government servant cannot go by his own conscience only, his own sense of right or wrong, his own use of discretion and his

own view of what is the most beneficial and the most expedient policy; he is of course master of his own conscience only and must for, his own

sake avoid committing a clear and straightforward crime; but short of that he has to put into practice the policy and the dictates of his superiors and

the superiors of his superiors. He has no choice in the matter. Yes Boss, is a statement which a Government servant must necessarily often make to

himself and act on the basis of the same.

These things are well known. Once a Government servant is seen as discharging the will and policy of others, it is not difficult to see why for

acting as such in accordance with the current policy and the current orders, he is protected from prosecution. The Government which is the prime

maker of policies and the prime source of orders to its servants and subordinates, is expected to protect its own servants from prosecution, if in its

discretion it considers such servants to have merely given shape to the Government''s own policies and dictates.

See how this reason comes in the practical play into our case.

Neera Yadav was dismissable by the Central Government; she was a Central Government employee from that point of view but she was not

at NOIDA following any Central Government dictates or furthering any Central Government policies. She was concerned with the affairs of the

Uttar pradesh State Government. In a situation of this nature, it is for the State Government to see whether the sanction for prosecution is

expedient it is not, on the basis of the above explanation of objective. It is not for the Central Government to see whether a NOIDA job was being

done in accordance with the State Government''s wishes.

This is why in Section 197, although a public servant qualifies for protection on the basis of his service under a Government which might be the

Central Government or the State Government, sanction is given only by that Government with the affairs of which the prospective accused was

concerned at the time of commission of the alleged material offence.

On this purposive construction also, in my opinion Section 197 would become applicable.

Seventhly, if Section 197 and Section 19 are put side by side and read together, it would be seen that for Sub-section (1) (a) and (1) (b) of

Section 19, the sanctioning authority u/s 197 and the sanctioning authority u/s 19 are the same.

It is only in the case of Section 19(1)(c) that a double sanction might become necessary. It might be argued that if Section 197 is in any event

applicable, then the insertion of Sub-sections (a) and (b) of Section 19(1) was not necessary. This argument is easily meet. As far as possible the

Prevention of Corruption Act, 1988 was intended to be one whole compendium. It could not be made into a whole compendium without reference

to the Code of Criminal Procedure and the reason for that can be seen even in the several Sections that we have quoted above. It would not be

right in an Act of this nature to require no sanction for a public servant dismissable by a Government engaged in the affairs of that very Government

as an express provision of the separate Act itself; if Section 197 were to be dealt with in any certain manner by the legislature later on, the minimal

requisite sanction under the P.C. Act, 1988 would still remain as such untouched by any such general change of law.

We are aware that the seventh reason above is not as strong as the other reasons we have mentioned above, but giving a choice between

rendering several words of a particular Section otiose at least for the current period and also perhaps until an indefinite future time and the

alternative of reading words into the statute which are not there at all, we would certainly, in the context of individual civil liberty prefer that

construction which would favour the citizens rather than that which would favour the prosecution.

Eighthly, purpose of Section 197 has been considered in several Supreme Court cases. The importance of Section and the extreme necessity

of compliance with it is now settled in law beyond doubt. In the case of Mohd. Hazi Raza reported at 1998 S.C.C. (Cri) 1265, it is held that

employees of Government companies and Article 12 authorities would not be public servants within the meaning of Section 197. The respondents

relied on this case. In our opinion, it is not possible to opine that no sanction u/s 197 was required for Neera Yadav or Rajiv Kumar at all because

they were working for NOIDA, a Corporation was set up by a State Act. That is because both of them qualified as public servants who could not

be dismissed except without the sanction of the Central Government. The further reason is that when they were doing their duty in NOIDA, they

were certainly doing official duty within the meaning of Section 197. Also their jobs at that time were most certainly in relation to the affairs of the

State Government which was allotment of land, which is well known to belong to the State and not to the Central Government.

In this case, passages can be found where it has been observed that the protection of 197 must be accorded to the Government servant not

merely during his tenure of office but even after his retirement. The same objective of protection by the Government of persons who are thought by

them to have done only Government work on Government dictates might be argued to be underlying this extension of the protection also; at least

for my part I would certainly favour such an argument. It is not worthy that Section 19 of P.C. Act 1988 is yet to afford such protection to retired

public servants. If Section 197 is in any event applicable, they would get such protection form there. This is a good purposive construction point.

Mr. Mishra relied on the case of State of Karnataka through CBI Vs. C. Nagarajaswamy, for the proposition that if sanction for prosecution is

needed and it is not there, then everything becomes irregular. In our opinion, the proposition is not disputable. The case of Gauri Shankar Prasad

was also given by him and the case would be found reported at 2000 SCC (Cri.) 872. In paragraph 7 at page 876 of the reports, the Court said

as follows:-

The object of the section is to save officials from vexatious proceedings against Judges, magistrates and public servants but it is no part of the

policy to set an official above the common law. If he commits an offence not connected with his official duty he has no privilege. But if one of his

official acts is alleged to be an offence, the State will not allow him to be prosecuted without its sanction. Section 197 embodies one of the

exceptions to the general rules laid down in Section 190 Cr.P.C, that any offence may be taken cognizance of by the Magistrates enumerated

therein. Before this section can be invoked in the case of a public servant two conditions must be satisfied i.e. (1) that the accused was a public

servant who was removable from his service only with the sanction of the State Government or the Central Government; and (2) he must be

accused of an offence alleged to have been committed by him while acting or purporting to act in the discharge of his official duty.

The above test is fully satisfied in the case of both Neera and Rajiv. According to the State Government, they should not be prosecuted and

therefore in the opinion of the State Government, the prosecution is as bad as a vexatious, harassing and unwarranted prosecution. According to

the law of the land, the Courts must give way to the opinion and decision of the State in this manner.

One last point the ninth needs to be noted. The Prevention of Corruption Act is an off-shoot of the Indian Penal Code. Several sections of the

Code from Section 161 were repealed and the mid 19th Century legislation, in regard to these sections was given a new shape. The Prevention of

Corruption Act, 1947 was the predecessor of the present Act and where we have mentioned the old Section 5 of the old Act we have referred to

this Act; that section now changed to Section 13.

It is not that all offences under the Prevention of Corruption Act require sanction u/s 19; for example, offences under Sections 8 and 9, which

do not involve public servants directly but relate to persons, who corrupt the officials, do not require any previous sanction. An argument might be

made that when these special sections were taken out by the Court and inserted with a Section 19, which was almost an identical sentinel like

Section 197, the Court should not interpret the section in such a way as to require a double sanction and make prosecution under the Prevention of

Corruption Act even more difficult in such than those are under the general law, under the Cr.P.C. and the I.P.C. [In the referring order, which 1

dictated after dictating this judgment but before writing those lines or signing thus judgment, it is indicated that even Section 197 itself might require

a double sanction in some cases].

In my opinion, this is too general an argument to tilt the balance. The Prevention of Corruption Act was enacted, as it states in the beginning,

for consolidating and amending the law relating to the Prevention of Corruption and for matters connected therewith.

The Sections are wider than the older Sections of the Indian Penal Code, which have been replaced. There is a minimum amount of

punishment which is prescribed in Section 13(2) of the 1988 Act and a public servant who abuses his position as such for obtaining for himself or

for any other person any valuable thing or pecuniary advantage cannot be punished for a term of imprisonment, which is less than for the duration

of one year. The usual Scheme of the I.P.C. is to provide the maximum punishment; minimums are quite a rarity. We cannot read exactly into the

minds of the legislature, but Section 19 might well have proceeded on the basis that where there is a minimum punishment prescribed for such an

undefined term as ''abuse'' of one''s position as a public servant, it would be a good safeguard to require the double sanction one from the

Government taking the services and yet another from the distant real employer Government, which has sent its employee over. After all, the

success of a criminal prosecution will almost automatically require the discharge of an employee in the employing government''s Department also

and the employer Government might, within the bounds of imagination, refuse to grant sanction and call back the employee to do its own job if he,

in the discretion of that Government, is thought to be yet an uncorrupted valuable piece of Government machinery. This is a tenth point and is my

opinion, very important in practice.

For these reasons, I am of the firm opinion that sanction u/s 197 of the Code of Criminal Procedure was an essential prerequisite for

proceeding before the special Judge as far as both Smt. Neera Yadav and Sri Rajiv Kumar are concerned; if they cannot be proceeded against at

all and the prosecution against them is still born, one cannot catch hold of either Dr. Mahesh Prasad or Sri Ashok Chaturvedi; if Neera is out,

Ashok Chaturvedi and Mahesh Prasad cannot remain on; and to end a serious judgment in a light note permitting the same, would be like to allow

the Cheshire cat to disappear, but still let is grin remain.

On this ground, I would allow all the applications and quash all the proceedings with direction to stay all actions against the persons accused

for all time to come in relation to the said prosecution and eases.