CWP NO. 1487 of 2006 1 IN THE HIGH COURT OF PUNJAB & HARYANA AT CHANDIGARH CWP NO. 1487 of 2006 DATE OF DECISION: May 14 , 2007. Sukhdev Singh Dhindsa and others ...Petitioners Versus Union of India and others ....Respondents. CORAM: HON'BLE MR.JUSTICE J.S. KHEHAR HON'BLE MR. JUSTICE S.D. ANAND PRESENT: Mr.R.N.Trivedi, Senior Advocate, with Mr.G.M.Umair, Advocate and Mr.H.S.Sidhu,Advocate, for the petitioners. Mr.Mohan Parasaran, Addl. Solicitor General of India, with Ms.Ramea Hakeem, Advocate, for Union of India. Mr.R.S.Cheema, Advocate General, Punjab, with Mr.Sanjeev Sharma, Addl. Advocate General, Punjab, for the State of Punjab J.S. Khehar, J. 1 Captain Amarinder Singh (respondent No.6) was sworn in as the Chief Minister of Punjab, as a consequence of the success of the Congress party in the previous elections. This position has changed after arguments were heard in this case and judgment was reserved . Elections to the State Legislative Assembly were held on 13.2.2007. The Congress part did not remain in majority after the result thereof was announced. CWP NO. 1487 of 2006 2 Consequently, Captain Amarinder Singh is now no more the Chief Minister. In his place, Mr. Parkash Singh Badal has been sworn in as the Chief Minister. It is also pertinent to notice that the new Chief Minister, as a matter of fact, is the father of petitioner No.2 Sukhbir Singh Badal. 2 Sukhdev Singh Dhindsa (petitioner No.1), Sukhbir Singh Badal (petitioner No.2), Sukhdev Singh Libra (petitioner No.3), Paramajit Kaur Gulshan (petitioner No.4), Zora Singh Mann (petitioner No.5), Sharanjit Singh Dhillon (petitioner No.6) and Dr.Rattan Singh (petitioner No.8), are all Members of Parliament having been elected to the Lok Sabha, whereas, Varinder Singh Bajwa (petitioner No.7), is a Member of Parliament having been elected to the Rajya Sabha. 3 Raninder Singh (respondent No.7) is the son of the former Chief Minister Captain Amarinder Singh. Raninder Singh and Leonard A. Freeke (respondent No.15), a Dutch national, and a resident of Amsterdam, Netherlands, are stated to be old friends This friendship, according to the pleadings of this case, came to be established when the two met in 1987, during the pursuit of their respective academic careers, in the United Kingdom. According to the petitioners, Raninder Singh and Leonard A. Freeke have been meeting each other every year, even after Raninder Singh returned to India, and Leonard A. Freeke to the Netherlands. 4 Raninder Singh is stated to have conceived a project in the name of Punjab Intranet Company. The Punjab Intranet Company was allegedly planned to set up a national and international fibre optic cable network for establishing connectivity between business parks. The estimated initial cost of the project was 2 million Euros i.e. approximately CWP NO. 1487 of 2006 3 11.34 crore rupees. On account of the power at his command Raninder Singh (as his father was the then sitting Chief Minister in Punjab) along with Leonard A. Freeke are stated to have held a number of meetings, with senior bureaucrats, to discuss the aforesaid project. Captain Amarinder Singh, the former Chief Minister himself, and members of the Chief Minister's family along with Leonard A. Freeke are alleged to have held these meetings with Sanjit Sinha, IAS (respondent No.9), the then Chief Secretary of the State of Punjab, Dr. Y.S. Rajan (respondent No.10), the then Scientific Adviser to the then Punjab Chief Minister, and N.S. Kalsi, IAS (respondent No.11), the then Managing Director of Punjab Infotech, a State Government undertaking. 5 Leonard A. Freeke, it is alleged, has his own company by the name, Esquare Communications BV Limited, in the Netherlands. Esquare Communications BV Limited was required, to prepare a business plan for setting up the aforesaid project for the Punjab Intranet Company. The Punjab Government, according to the pleadings of this case, had settled to pay 1 million Euros, to Esquare Communications BV Limited for the preparation of the business plan, as well as, for the execution of the project. 6 Raninder Singh is stated to have addressed an e-Mail to Leonard A. Freeke on 14.5.2003, wherein he requested the Dutchman to associate one Chetan Gupta, who had been identified as his ( Leonard A. Freeke's) local Indian partner. The e-Mail described Chetan Gupta as an old family associate (of Captain Amarinder Singh). The e-Mail also mentioned that Chetan Gupta had been chosen by the Chief Minister himself for the joint venture. The aforesaid e-Mail dated 14.5.2003 is CWP NO. 1487 of 2006 4 being reproduced hereunder:- “Dear Leo, I have had a long meeting with Prof. Rajan & S.K. Sinha about your project today. Briefly we have identified the local Indian partner that you are going to work with in India on your project. He is Mr. Chetan Gupta who is an old family associate of ours & has been chosen by the Chief Minister & our team to be the Indian partner for your JV with the Punjab Govt. Between Esquare and him, you shall control 51% of the JV Company, 49% shall be govt stake for a limited period & a buyout clause say after 2 years either by offloading to you guys or to the public. Since it is not possible for the government to send the cash before the end of june... I have taken the liberty of organizing the following: You & his overseas co. (must be overseas) shall exchange a letter saying that you shall reimburse the amount of 2.5 mill euro within 3 working days of receipt of consultancy fees from Pb. Government (this shall happen at the outside by 30th June). You must also formalize your partnership with him (with his Indian company....) In the meantime, early next week, he shall act as a bridging loan facilitator & fwd the amount to you. The amount shall be split in 2 or three parts details he shall work out with you day after tomorrow. Upon receipt of the govt. money you return his cash. This way the project moves on & the three member team shall arrive with you in Holland by the 23rd of June to do the report... Rajan shall brief you there on whose needs to know how much on the team (Indians). Chetan Gupta shall also arrive in Holland with them. Needless to say before they come CWP NO. 1487 of 2006 5 Chetan shall fwd a substantial amount of the money to you, prior to their arrival. Only the difference shall be that the likes of reliance and airtel etc. shall not be in on any presentations with by you, but the JV shall negotiate with them at the appropriate time to provide handwidth capacity supply on commercial terms. Hope this sorts out your problem, can't do more at this time. Love & kisses Tikku” 7 On 28.12.2003 the Hindustan Times, in its Chandigarh edition, published an Article under the title “Curious transactions in name of Punjab Intranet?” The aforesaid Article, which is responsible for having raised the instant controversy, is being extracted hereunder:- “A SINGAPORE firm sends US $100,000 to a company in Mauritius, which passes on half that sum to a Channel Islands entity along with a letter saying an additional $ 900,000 is on its way. All this in the name of a company the Punjab government once proposed to set up but whose future is now in doubt. A letter dated August 12 from Mauritius-based SMX Global Technologies Services Ltd to Esquare Limited, Channel Islands, says SMX had received the money “on behalf of Mr. Ranainder Singh, your Consultant/Partner in the Punjab Intranet Company”. A copy of the letter was marked to Ranainder Singh, NewMoti Bagh Palace, Patiala (Punjab). The palace is the private residence of Punjab Chief Minister Capt. Amarinder Singh and the name of the CM's only son is Raninder Singh. In this letter, J.E.C. Grange, Chief Operating Officer of SMX, informed Leonard Freeke of Esquare Limited, Channel Islands, that SMX received US $ 100,000 – in reference to PIC – from ABT Tech, Singapore, into the CWP NO. 1487 of 2006 6 account of Mauritius-based SMX Global Technologies Services Ltd at the Credit Suisse, Montreus (Switzerland) on August 8, 2003 as per invoice number 0803-003. The money, as per the letter, was received by SMX on behalf of Ranainder Singh. Grange's letter further said: “We have issued a payment to you as per instructions to Esquare Communications Ltd. 29 J. Kepler St.Mellieha, Malta, as per invoice number “200318” today. We await the balance remittance of US $900,000 as per our agreement at the earliest.” Banking records also indicate that a sum of US $50,000 was transferred to Esquare that very day in Malta. When contacted, the Chief Minister's son, Raninder Singh, admitted to Freeke being his friend but strongly denied any connection with the money transfers. He said, “Freeke may be trying to involve me in such transactions, just because he knows my father is the CM of Punjab. But I am not involved in any money transfer business and have no personal agenda.” (see box) Freeke, however, did not respond to questionnaires twice send to him on e-mail on Tuesday and Wednesday by HT investigations reveal that Esquare Communications Limited in Mellieha (Malta) raised an invoice for US $100,000 to SMX Global once again for consultancy services for collaboration on PIC Project” on August 14, 2003. Three other invoices with HT show that a sum of US $100,000 was again raised on September 1, US$50,000 on September 14 and US $100,000 on October 1, 2003 in the name of Esquare Ltd. located in Channel Islands. What is strange is how and why the money transactions were taking place for a company which is not yet established – and may never be. It all started with Punjab Technical University Vice- Chancellor Y.S. Rajan and Managing Director of Punjab CWP NO. 1487 of 2006 7 Infotech N.S. Kalsi visited Amsterdam (Netherlands), among other foreign countries, to explore the possibility of setting up of the proposed PIC project in Punjab to provide optical fibre backbone, and also to explore foreign investment in the State. In Amsterdam, both the officers met Freeke and had a discussion on the issue. Kalsi, when contacted, said that Freeke had earlier met Rajan in New Delhi on the project and later Rajan and he had met Freeke in Amsterdam. Subsequently, Esquare communications Ltd. B.V. prepared the preliminary business plan in collaboration with SMX Global Technologies Services Ltd. Mauritius, on the instructions of Rajan. Early this year Freeke made a presentation in Chandigarh and explored the possibility of the setting up of Punjab Intranet Company (PIC). The proposed PIC, as envisioned by the report prepared by Esquare Communications B.V., had a legal framework consisting of Punjab government, Esquare Communications and financiers. According to the business plan, “Esquare management will overview the realisation of PIC, which aims to achieve a payback period of less than three years of the investment.” A strong political association in the proposed project in the beginning itself is clearly visible because the business plan prepared by Esquare said that “leading members of the Punjab political and business community will be approached for the PIC's supervisory board”. Interestingly, one of the communications exchanged between officials of SMX and Esquare in September 2003, says, “The Internet Exchange in Punjab is just a project in a full ICT stimulation programme. We are now negotiating with the government on our role in this bigger context: the Programme. Since i have to decide with Leonard on the company that will be used in the partnership, I for now use CWP NO. 1487 of 2006 8 HOLDING as referring to that company name in the MoU.” An intensive website search revealed that apart from Esquare Communications B.V. in Amsterdam which was already existing, on September 1, 2003, the following three companies were registered in Channel Islands, namely, Esquare Communications Limited, Esquare HOLDING Ltd and Esquare International Ltd. vide registration number 12,425, 12,426 and 12,427, respectively. While as per the business plan of Esquare, the company was asked by the Punjab government to prepare the report in this regard, Kalsi denied that the state government had asked it do so. “We didn't pay any money for consultancy to Esquare/” he said. When contacted, Rajan said that he and Kalsi had an extensive foreign tour, which also included discussions with personnel of Esquare Communications B.V., Amsterdam. “I don't know about any transfer of foreign money in this connection. I was only involved as regards the technical aspect and Kalsi would be in a better position to explain the latest status of the intended project.” Kalsi confirmed that efforts had been made to set up PIC and Esquare officials had visited Punjab to survey the area for the project in the initial stage. He claimed that “now, we propose to have a society comprising major telecom players in the country including Connect, Bharti, WorldTel, Puncom and Glide, to set up the facility, where the Punjab government wold merely be a facilitator.” He, however, denied knowledge of the above- mentioned financial transactions in the name of PIC project and stated, “Raninder (Amarinder's son) never discussed with me on the project and to the best of my knowledge had nothing to do with the project at any stage.” 8 The aforesaid newspaper Article encloses a letter addressed CWP NO. 1487 of 2006 9 by J.E.C. Grange, the Chief Operating Officer of the Punjab Intranet Company, to Leonard A. Freeke dated 12.8.2003. The aforesaid letter, according to the petitioners, authenticates the facts alleged in the article published in the Hindustan Times, specially when read with the e-mail dated 14.5.2003 (reproduced above). The aforesaid letter dated 12.8.2003 is also being extracted hereunder:- “Mr Leonard Freeke Esquare Limited 47 Esplanade, St Holior Jersey JE108D Channel Islands 12th August 2003 Dear Mr Leonard, Reference to our ongoing project, Punjab Intranet Company (PIC) We have received $100,000 in our account at the Credit Suisse, Montreux, Switzerland on the 8th August 2003 from c/o ABT Tech, Singapore as per our invoice number 0803- 003, on behalf of Mr. Ranainder Singh your Consultant/Partner in the Punjab Intranet Company. We have issued a payment to you as per instructions to Esquare Communications Ltd. 29 J Kepler St. Mellieha, Malta as per invoice number “200318” today. We await the balance remittance of $900,000 as per our agreement at the earliest. Yours sincerely, sd/-xx J.E.C.Grange Chief Operating Officer CC: Mr. Ranainder Singh, New Moti Bagh Palace, Punjab,India. 9 The article, which had appeared in the Hindustan Times on 27.12.2003, also enclosed a `box' extracting the comments/statement made by Raninder Singh in connection with the contents of the article. CWP NO. 1487 of 2006 10 The contents of the box are being extracted hereunder: “I KNOW FREEKE SINCE COLLEGE BUT NOTHING ABOUT PUNJAB INTRANET COMPANY: RANINDER RANINDER SINGH, when contacted admitted that he had known Leonard Freeke for the past several years. “We studied together in a college in the University of Buckingham, England. My wife even attended Freeke's wedding recently.” he added. Asked whether he had any business partnership/association with Freeke, the CM's son said, “I have no business interest with anyone abroad, except that I look after my father's business in India.” On transactions between SMX and Esquare, he said he had no idea about it. “I don't know about SMX or ABT Tech. I am not involved in any such transactions.” When informed that a copy of letter sent by SMX Global to Freeke had been marked to him at the New Moti Bagh Palace, Raninder Singh said, “Freeke keeps sending me letters and mails, but I have nothing to do with PIC or any such project. HTC,. Chandigarh.” 10 It is alleged on behalf of the petitioners, that the aforesaid article, which had appeared in the Hindustan Times on 28.12.2003, created a political storm in the State of Punjab, whereupon demands were raised that investigations be initiated into the allegations levelled in the article and the guilty be punished. It is also alleged on behalf of the petitioners, that with the avowed purpose of preventing any meaningful investigation, Captain Amarinder Singh, the Chief Minister, through a notification dated 2.1.2004, manoeuvred the appointment of a Commission of Inquiry, under the Commission of Inquiries Act, 1952, headed by Mr. Justice B.S.Nehra, a retired Judge of this Court, to enquire into the “truthfulness or otherwise”, of the facts alleged in the CWP NO. 1487 of 2006 11 article, which had appeared in the Hindustan Times, published on 28.12.2003. Under the mandate of the notification, the report was to be submitted by the Commission within two months of its constitution. 11 Consequent upon the appointment of the aforestated Commission of Inquiry, deliberations were held by it, resulting into a report dated 17.12.2004. The aforestated notification, setting up the Commission of Inquiry, dated 2.1.2004, and its report dated 17.12.2004, are subject matter of challenge at the hands of the petitioners through the instant writ petition. The challenge to the notification dated 2.1.2004, as well as, the report dated 17.12.2004 was primarily on technical grounds. It is, therefore, that detailed reference was not made to the aforesaid report during the course of hearing of this case. Limited references were made to the report, to the extent they were relevant to the issues canvassed. We, however, consider it just and appropriate to narrate, for a complete and effective adjudication of the controversy raised in this case a bird's eye view of the deliberations, the evidence recorded and the conclusions drawn by the Commission. The same are recorded in the succeeding paragraphs. 12 The Commission commenced its deliberations by publishing notices, inviting persons and organisations acquainted with the facts and circumstances pertaining to the subject matter of enquiry, to make a statement of facts in support of the matter under investigation, as also in respect of matters incidental or ancillary thereto, and provide all other evidence available with them of the facts asserted in their statements. The aforestated notices appeared in different newspapers on 22.1.2004 and 23.1.2004. Despite publication in a number of newspapers, no person CWP NO. 1487 of 2006 12 belonging to the general public, politicians or journalists, came forward to provide any material during the course of enquiry, except Kanwar Sandhu, Resident Editor of the Hindustan Times and Manish Tewari, Principal Correspondent of the Hindustan Times. Consequently, the task of the Commission was limited to questioning and recording statements on behalf of the Hindustan Times i.e. the newspaper which had published the controversial news-item in its Chandigarh edition on 28.12.2003, besides government officers, referred to in the said article, and the main person targetted in the article, namely, Raninder Singh (respondent No.7), the son of the former Chief Minister Captain Amarinder Singh. 13 Kanwar Sandhu, Resident Editor of the Hindustan Times, filed an affidavit dated 16.2.2004 for the consideration of the Commission. Besides his affidavit, he also furnished documents and information to the Commission, on the basis of which he wished to authenticate the report of Manish Tewari, Principal Correspondent, Hindustan Times, published on 28.12.2003. An extract of the affidavit of Kanwar Sandhu, highlighting the important points to be taken into consideration by the Commission of Inquiry is being reproduced hereunder:- “ Important points to note (which were crucial to the news report):- Page 1: The report was prepared on March 12, 2003. Page 3 (Para 2): The Management of Esquare was asked by the Punjab Government to prepare business plan. Page 14 (Para 3) : PIC is an independent dark fibre provider, not tied to any other network operator.... Page 24 : The legal structure of the proposed PIC has Esquare Communications as one of the partners. It also says CWP NO. 1487 of 2006 13 that leading members of the Punjab political and business community will be approached for PIC's supervisory board. When Hindustan Times news item appeared on December 28, Chief Minister Capt. Amarinder Singh stated at a press conference that neither was there any Punjab Intranet Company in existence in the State, nor was it ever planned to be set up at any point of time. However, the Business Plan on PIC prepared in March, 2003, by Esquare; various communications between Mr. Freeke and Mr. Sachin Duggal; the visit of Mr. Kalsi and Mr. Rajan to Amsterdam and their meeting with Freeke in July, 2003; the visit of Mr. Sachin Duggal and Mr. Freeke to India in August in connection with the same project; and Mr. Freeke's letter dated December 29,2003, released by the Chief Minister in a press conference, that he had been waiting to hear something on the PIC project for the past four months; clearly belies the Punjab Government's claim that the PIC was neither discussed nor envisaged at any point in the past.” It would be pertinent to mention that Kanwar Sandhu, Resident Editor of the Hindustan Times, was also required by the Commission, through letters dated 10.3.2004 and 25.3.2004, to submit documents in conformity with the Regulations of Procedure Order 2004, of the Justice Nehra Commission of Inquiry. On the receipt of the aforesaid letters, Kanwar Sandhu, furnished the following reply, vide his letter dated 30.3.2004:- “ Please refer to your letter of March 10 and March 25, 2004 regarding submission of documents in conformity with the regulations of procedure 2004 of Justice Nehra Commission of Inquiry. I would like to state that since the inquiry related to a news item which appeared in Hindustan Times, we thought it CWP NO. 1487 of 2006 14 our duty to pass on to the Commission certain documents which helped form the basis of the newsitem. However, since instead of using these documents which are self- explanatory, you are insisting on regulations and procedures, we are not keen to submit anything in this connection. You would appreciate that a professional journalist cannot disclose the source of information, as required by the Regulations of Procedure of the Commission that you have quoted.” It is apparent that Kanwar Sandhu, despite having submitted to the jurisdiction of the Commission of Inquiry, did not comply with the Commission's letters dated 10.3.2004 and 25.3.2004. 14 Nirmaljit Singh Kalsi, Managing Director of Punjab Information and Communication Technology Corporation Limited, (referred to as N.S. Kalsi in the newspaper report) submitted an affidavit dated 31.3.2004 to the Commission. During the course of his questioning before the Commission he, inter alia, stated as under:- “Question No.6: Whether Shri Raninder Singh had ever called you or enquired from you or given any orders to do anything in the matter of Esquare Communication at the time of your visit till today? Answer No.6: Shri Raninder Singh has never contacted me in this regard. Question No.7: Whether at any time, anybody in the Government, despite your declining certain proposals for M/s Esquare Communications, has ordered you to pressurized you or suggested you to give any kind of monetary benefits to Esquare Communications? Answer No.7: No. Rather Chief Minister, who is also the CWP NO. 1487 of 2006 15 Minister-in-charge of the Department of Information Technology and Department of Industries and Commerce, concurred with my report for declining the proposal. Question No.8: Shri Kalsi has brought the original record of the entire matter which was perused by the Commission and Xerox copies of the relevant portion retained by the Commission for further proceedings. Mr. Kalsi may kindly see the record and tell the Commission whether any communications or any suggestions were made by the Government to Esquare Communications to the effect that certain amount of money would be paid to them for any work done by them on behalf of the Government? Answer No.8: No. No money was ever paid or promised by the Government to be paid to M/s Esquare Communications for any work as per the record available with the Corporation. As is also clear from para 13c of my affidavit, the Punjab Government as to act only as a facilitator for setting up of an Internet Exchange on the request of Internet Services Providers without having any financial stake of