IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE K.T.SANKARAN FRIDAY, THE 2ND DECEMBER 2011 / 11TH AGRAHAYANA 1933 Crl.MC.No. 3229 of 2011 CRIME NO.1/97/SCT OF VIGILANCE DEPARTMENT, THIRUVANANTHAPURAM. PETITIONER: ACCUSED ---------------------- JIJI THOMASON,S/O.EASO THOMAS, ANNA MIRIA,N.C.C.ROAD,AMBALAMUKKU,PEROORKADA, THIRUVANANTHAPURAM,KERALA,PRESENTLY RESIDING AT:C-II/16,BAPA NAGAR,NEW DELHI. BY ADV. SRI.S.RAJEEV RESPONDENT: COMPLAINANT: --------------- STATE OF KERALA,REP.BY PUBLIC PROSECUTOR HIGH COURT OF KERALA,ERNAKULAM, (CRIME NO.1/97/SCT OF VIGILANCE DEPARTMENT) ADVOCATE GENERAL SRI.K.P.DANDAPANI ADV. SRI.T.A.SHAJI THIS CRIMINAL MISC. CASE HAVING BEEN FINALLY HEARD ON 31/10/2011, THE COURT ON 02/12/2011, PASSED THE FOLLOWING: APPENDIX PETITIONER'S EXHIBITS: ANNEXURE 1 COPY OF THE PETITION SUBMITTED BY THE SUPERINTENDENT OF POLICE. ANNEXURE II COPY OF THE ORDER DATED 14.3.2011 PASSED BY THE ENQUIRY COMMISSIONER AND SPECIAL JUDGE IN CRL.M.P.NO.453 OF 2011. ANNEXURE III COPY OF THE REPORT SUBMITTED BY THE INVESTIGATING OFFICER DATED 13.5.2011. ANNEXURE IV COPY OF THE ORDER PASSED BY THE LEARNED SPECIAL JUDGE. //TRUE COPY// AHZ/ K.T.SANKARAN, J. ------------------------------------------------------ CRL.M.C. NO. 3229 OF 2011 ------------------------------------------------------ Dated this the 2nd day of December, 2011 O R D E R This Criminal Miscellaneous Case is filed by accused No.5 (Jiji Thomson) in C.C.No.6 of 2003, on the file of the Court of the Enquiry Commissioner and Special Judge, Thiruvananthapuram, challenging Annexure IV order dated 8.8.2011. By the order impugned, the Enquiry Commissioner and Special Judge rejected Annexure III report dated 13.5.2011, submitted by the Superintendent of Police, VACB, Special Cell, Thiruvananthapuram after conducting further investigation under Section 173(8) of the Code of Criminal Procedure. By the impugned order, the Enquiry Commissioner and Special Judge directed further investigation into the involvement of CW23, the then Finance Minister, and to submit a report within three months. 2. The prosecution case, in a nutshell, is the following: During the period from October 1991 to March 1992, the accused entered CRL.M.C. NO.3229 OF 2011 :: 2 :: into a criminal conspiracy for importing palmolein directly to the State of Kerala and managed to secure permission of the Government of India for the same by misrepresenting facts to the Prime Minister of India and the authorities of the Government of India. Accused No.1 was Sri.K.Karunakaran, the former Chief Minister of Kerala. Accused No.2 is the then Minister of Food and Civil Supplies (Sri.T.H.Mustafa). Accused Nos.3 to 5 and 8 are the IAS Officers who were holding different posts at the relevant time. Accused Nos.6 and 7 are Directors of M/s.P&E Pvt. Ltd., a Singapore based company. It is alleged that a quantity of 15000 metric tonnes of palmolein was imported at an exorbitant rate of 405 US Dollars per metric tonne, while the average price paid by the State Trade Corporation during the relevant period was less than that rate. Agreement was executed for the supply of palmolein even before permission of the Government of India was received and even before any order was issued by the State Government for that purpose. No tenders were invited for the import of palmolein. It is alleged that accused Nos.1 to 5 and 8 abused their official position and authority as public servants and acted illegally and with dishonest intention to secure pecuniary and other benefits to accused Nos.6 and 7 to the CRL.M.C. NO.3229 OF 2011 :: 3 :: tune of `2.32 crores, thereby causing corresponding loss to the Kerala State Exchequer. It is alleged that the accused committed the offence of criminal conspiracy, criminal breach of trust and cheating, punishable under the Indian Penal Code and the Prevention of Corruption Act, 1988. The offences alleged against the accused are under Sections 120B of the Indian Penal Code and Section 13(2) read with Section 13(1)(d) of the Prevention of Corruption Act, 1988. 3. It is alleged that accused Nos.2 to 4 by mutual assistance and with the consent of late accused No.1, prepared a note and presented the same in the meeting of the Council of Ministers as an urgent item outside the agenda. The approval of the Council of Ministers was obtained suppressing material facts and also suppressing the offer made by another company at a lower rate. On 5.10.1991, late accused No.1 sent a letter to the Prime Minister of India and directed accused No.4 to take follow up action. Accused No.4, without inviting tenders, held further discussions with accused Nos.6 and 7 and prepared proposals incorporating the terms and conditions stipulated by M/s.P&E Pvt. Ltd. and forwarded the same CRL.M.C. NO.3229 OF 2011 :: 4 :: to the Government of India. Accused No.4 prepared the proposal incorporating the terms and conditions advantageous to accused Nos.6 and 7 and submitted the same to accused Nos.1 to 3 for urgent decision. At that time, sanction of the Government of India was not received by the State Government. It is also alleged that accused No.5 held discussions with accused Nos.6 and 7 long before M/s.P&E Pvt. Ltd. was chosen for importing palmolein. It is alleged that during February-March 1992, a quantity of 15000 metric tonnes of palmolein was imported to the State and the price for the same was fixed on 24.1.1992, after 56 days of the execution of the agreement. The further allegation is that accused No.8 withheld the relevant files from the Finance Department in order to avoid any remarks being made by the Finance Department on the draft Government Order. The provisions of Store Purchase Rules, Business Rules and security instructions were violated in the palmolein deal. Several other allegations were also made against the accused to show that they committed the offences alleged. 4. The crime was registered as Crime No.1 of 1997. After investigation, final report was submitted on 23.3.2001. Cognizance CRL.M.C. NO.3229 OF 2011 :: 5 :: was taken by the Enquiry Commissioner and Special Judge on 12.3.2003. Thereafter, the case had a chequered career and the matter went up to the Supreme Court on more than one occasion, details of which are mentioned in paragraph 7 herein below. 5. The prosecution filed a report dated 5.3.2011 informing the Court that they are proceeding with further investigation under Section 173(8) of the Code of Criminal Procedure. The report dated 5th March, 2011 read as follows: “In the charge sheet filed on 23.3.2001, further proceedings could not be conducted in view of the stay order from Higher Courts. Now new facts came to the notice of the investigating agency, such as the press conference convened by CW 23, the then Finance Minister, wherein he has admitted that he knew everything about the Palmolien deal. This was reported in almost all national dailies such as, The Hindu, Malayala Manorama, Mathrubhumi, Kerala Kaumudi etc. on 20.01.2005. Further, in the discharge petition filed by Sri.Zachariah Mathew (A4) before this Court, he has CRL.M.C. NO.3229 OF 2011 :: 6 :: disclosed that the proposal for the import of palmolien, using M/s.Power and Energy Ltd., Singapore as the intermediary and payment of 15% C.F.value as service charges was placed before the Finance Minister as he is the final authority to decide the financial proprietary of the proposal. Sri.Jose Cyriac (CW 20) who prepared the answers to the public undertaking committee to the question 15, 16 and 17 has stated that the proposal to purchase the Palmolien was done with the approval of the then Finance Minister. The file No.18889/PuD2/Fin placed before the Kerala Legislative Assembly, in the last session, also disclosed certain aspects of the matter, which had not been considered at the time of the investigation. Hence, in order to meet the ends of justice, it is necessary to conduct a further investigation, keeping in view of the facts mentioned above, or further materials that may come to notice, from a different angle. This report is filed as supplementary statement to the petition filed by the Special Prosecutor on 26/02/2011 seeking formal permission for further investigation.” 6. The report and the petition dated 5th March, 2011 were CRL.M.C. NO.3229 OF 2011 :: 7 :: considered by the Court and Annexure II order dated 14th March, 2011 was passed granting formal permission for proceeding with the further investigation under Section 173(8) of the Code of Criminal Procedure. However, taking into account the fact that the FIR was registered in the case in 1997, the Court directed to complete the further investigation and to submit the supplementary final report within a period of three months. 7. In Annexure II order dated 14th March, 2011, the learned Enquiry Commissioner and Special Judge narrated the chequered career of the case thus: “3. The FIR was registered against A1 to A6 in relation to an offence under S.13(2) r/w.13(1)(d) of P.C.Act, 1988 and S.120-B of I.P.C. as Crime 1/97. Late Sri.Karunakaran the Chief Minister who was arrayed as A1 filed a petition before the Hon'ble High Court being Criminal Miscellaneous No.1353/97 praying for quashing the said FIR registered against him and other persons. The Hon'ble High Court dismissed the said writ petition declining to quash the FIR registered against the said persons. A1 challenged the said order before the Hon'ble Supreme Court by filing petition for CRL.M.C. NO.3229 OF 2011 :: 8 :: special leave to appeal, being Criminal Appeal No.86/98 which was admitted on 16.1.1998 and permitted the Investigating Officer to continue the investigation with a rider that the accused shall not be arrested and final report shall not be filed without direction from the Hon'ble Supreme Court. Meanwhile the investigation was completed and the matter was reported to the Hon'ble Supreme Court and with the permission of the Hon'ble Supreme Court final report under S.173(2) Cr.P.C. was filed before this Court on 1.11.1999. Criminal Appeal No.86/98 was dismissed by the Hon'ble Supreme Court on 29.3.2000. As the Investigating agency was of the view that sanction from Loka Sabha Speaker is necessary for prosecuting A1 this court was requested to take cognizance of the offence after getting the permission of the Speaker of the Loka Sabha. On 21.1.2000 another report was filed by the Investigating Agency seeking extension of time to obtain permission for prosecution. The time was extended by three months as a last chance to obtain and produce necessary sanction. Again on 20.4.2000 another report was filed by the Investigating Agency seeking further extension of time. This Court was not inclined to extend time and ordered to return the final report to the Investigating Officer to resubmit the same after obtaining permission. On 23.3.2001 the Investigating CRL.M.C. NO.3229 OF 2011 :: 9 :: Officer resubmitted the final report stating that since A1 has ceased to be the Chief Minister of Kerala, permission of the Speaker of the Loka Sabha is not required to prosecute him. This court held that the permission of the Lok Sabha Speaker is necessary to prosecute A1. The said order was challenged by the State of Kerala before the Hon'ble High Court in Crl.RP No.430 of 2001. The Hon'ble High Court by order dated 19.2.2003 found that A1 was the Chief Minister of State of Kerala when the offences were alleged to have been committed by him and he demitted his office as the Chief Minister and when the charge sheet was filed he was a member of the Parliament. It was further held that there is no allegation that he has misused or abused his office as a member of the Parliament for corrupt motives and therefore no permission of the Speaker of Lok Sabha would be necessary to prosecute him despite the fact that he was a member of the Parliament when the charge sheet was filed. Hence the order of this court was set aside and the revision petition was allowed. The said order was challenged by A1 before the Hon'ble Supreme Court in Criminal Appeal No.801/2003. While the said matter was pending before the Hon'ble High Court, the State of Kerala vide letter dated 24.1.2005 wrote to the DoPT that for reasons recorded in the letter, they wish to CRL.M.C. NO.3229 OF 2011 :: 10 :: withdraw their request for according sanction for prosecution of the officers. Accordingly the affidavit was filed by the Chief Secretary of Kerala on 24.11.2005 before the Hon'ble Supreme Court stating that the State Government wanted to withdraw the prosecution. Meanwhile on 18.5.2006 again the left democratic front formed the Government of State of Kerala and vide letter dated 10.10.2006 the Chief Secretary to the Government of Kerala wrote a letter to the Government of India informing them that the State Government had decided to continue the prosecution launched by it and as such it sought to withdraw the above letter dated 24.1.2005. Accordingly another affidavit was filed before the Hon'ble Supreme Court stating that there is no intention to withdraw the prosecution. A1 before the Hon'ble Supreme Court then contended that it was a clear case of political vendetta. Criminal Appeal No.801/2003 was disposed by the Hon'ble Supreme Court by Judgment dated 8.12.2006. In this Judgment the Hon'ble Supreme Court affirmed the view taken earlier in R.S.Nayk v. A.R.Antulay (1984(2) SCC 183) and reiterated in Prakash Sing Badal v. State of Punjab (2007 (1) SCC 1) that the sanction is not required. The contention raised subsequently by A1 in the above proceedings before the Hon'ble Supreme Court that the prosecution is the outcome of malafides and that the CRL.M.C. NO.3229 OF 2011 :: 11 :: verifying stands taken by the Government clearly indicated that A1 is a victim of Political rivalry of leaders of some political parties was directed to be decided by the Hon'ble High Court and the parties were permitted to place relevant materials before the Hon'ble High Court. The Hon'ble High Court in Criminal RP.No.430/2001(A) in the order dated 6.7.2007 after elaborate discussion of the matter it was found that the contention of A1 that the act of the successor Government rescinding the Government Order for withdrawal of prosecution is a malafide exercise of power has no merits. It was further held that G.O.(Rt) No.143/06/Vig. dated 25.7.2006 that rescinded the withdrawal G.O.(Rt)No.105/05/Vig. dated 28.3.2005 is not vitiated by malafides and is not liable to be struck down. The said order of the Hon'ble High Court was challenged by A1 before the Hon'ble Supreme Court in Criminal Appeal No.1017/07. The Hon'ble Supreme Court had stayed further proceedings before this court. The said appeal remained pending before the Hon'ble Supreme Court till 23.12.2010 when it abated because of the demise of A1. The order dated 11.1.2011 to the effect that the appeal abated and is dismissed was communicated to this Court.” 8. After the Honourable the Supreme Court disposed of the CRL.M.C. NO.3229 OF 2011 :: 12 :: case on 11.1.2011, accused Nos.2, 3, 4 and 5 filed petitions praying that they may be discharged. Those petitions are pending consideration. 9. After conducting further investigation, the Superintendent of Police, Vigilance and Anti-Corruption Bureau, Special Cell, Thiruvananthapuram, filed Annexure III report dated 13th May, 2011, the concluding part of which reads as follows: “Thus the further investigation revealed the following facts. The import of palmolein through Power & Energy Company was decided by the cabinet as a Government policy. Since it was a Government policy, decision for import could not be considered as a violation of Store Purchase Rules. After the cabinet decision, the Civil Supplies Department has to seek concurrence from the Finance Department before issuing the Government Orders for entrusting the import to Civil Supplies Corporation. But it is revealed that the Civil Supplies Corporation has executed the agreement on 29.11.1991 with Power & Energy Pvt. Ltd. before issuing the Government Order vide G.O.(MS) 13/91/F&CSD on 2.12.91. This reveals that the Civil Supplies Corporation and Food and Civil Supplies Department have violated all CRL.M.C. NO.3229 OF 2011 :: 13 :: the departmental procedures, Rules of business and Secretariat Circulars. Since the Civil Supplies Department has not forwarded the concerned file to the Finance Department, the Department could not peruse the deal in details and offer their remarks. Even though, the Finance Department has made an effort to get thefile relating to the palmolein deal on 3.2.92 from the Civil Supplies Department (File No.10028/C2/91 of Food & Civil Supplies Department), the file was received only on 29.2.92 in the Finance Department and happened to be returned the file on the same day on the request of Food and Civil Supplies Department for answering the L.A. interpellation before placing it to Finance Secretary, Commissioner and Secretary and Finance Minister. This file had not received later at Finance Department for any action. Hence the Finance Department could not be considered as responsible for the irregularities in the import of palmolein. Thus the further investigation could not reveal the involvement of any other person in this case, other than who were arrayed as accused in the Charge Sheet already submitted before the Honourable Court. Hence it is humbly submitted that since no additional evidence could be forthcoming regarding the involvement of any other accused in this case other than CRL.M.C. NO.3229 OF 2011 :: 14 :: the accused listed in the Charge Sheet already submitted, the Hon.Court may be pleased to accept this report and proceeded further.” 10. Annexure III report dated 13.5.2011 was considered by the Court and it was rejected by the order dated 8th August 2011, which is under challenge in this Criminal Miscellaneous Case. The investigating officer was directed to conduct further investigation into the involvement of CW23, the then Finance Minister, in the palmolein deal and to submit a report within three months. The learned Enquiry Commissioner and Special Judge held that further investigation was conducted for finding out the involvement of the then Finance Minister in the palmolein deal, but, in the further report dated 13.5.2011, nothing was stated about the involvement of the then Finance Minister in the palmolein deal. The learned Judge held that the Finance Department and the Finance Minister are distinct and separate. The learned Judge considered the statements made by the witnesses during further investigation and apparently came to the conclusion that CW23, the then Finance Minister, did not take any step for preventing the import of palmolein even after the corruption involved in the import of palmolein was reported in the CRL.M.C. NO.3229 OF 2011 :: 15 :: newspapers. It was also held that even after the note prepared by the fourth accused before the Cabinet meeting was seen by the then Finance Minister, he did not mention any contra opinion on the note. The statement of CW23, the then Finance Minister, recorded during further investigation was also analysed by the learned Judge and it was held thus: “19. The statement of CW23, the then Finance Minister, recorded by the Investigating Officer, shows that CW23 had approved the suggestion to place the file relating to the import of palmolein, given by the second accused in the cabinet as an outside agenda. He could understand the subject dealt with in the note prepared by the 4th accused. CW23 was aware that the matters mentioned in the note prepared by the 4th accused was in respect of the import of palmolein through Power and Energy Company paying 15% as service charge. CW23 was also aware that decision was taken to import palmolein through Power and Energy Company without inviting any tender. The cabinet decided to import palmolein choosing Power & Energy Company as the agent for the import of palmolein without inviting tenders. Though the note prepared by the 4th accused was not a cabinet note, the matter regarding the import of CRL.M.C. NO.3229 OF 2011 :: 16 :: palmolein was placed in the cabinet without a cabinet note as Kerala would not get palmolein if there was delay and so decision was taken as an outside agenda in the cabinet. CW23 was agreeable to take a decision in the cabinet to import palmolein. CW23 permitted to place the file of Civil Supplies in the cabinet for importing palmolein and CW23 accepted the proposal for importing palmolein in the cabinet. 20. The statement of CW23 recorded by the Investigating Officer manifestly and visibly shows that when the decision to import palmolein through Power and Energy Private Ltd. Company paying 15% as service charge, was taken in the cabinet, CW23 was aware that the service fee of 15% was not negotiated, that the concerned department had not invited global tenders and without inviting tenders Power and Energy Private Ltd. was chosen as handling agent for the import of palmolein, and that the import of palmolein was not in accordance with the conditions specified in the letters of the Central Government of India.” 11. The learned Enquiry Commissioner and Special Judge held in Annexure IV order dated 8th August, 2011 that though further investigation was conducted to ascertain the involvement of CW23, CRL.M.C. NO.3229 OF 2011 :: 17 :: the then Finance Minister, the further report submitted by the investigating officer did not say anything about the involvement of CW23, the then Finance Minister. On the other hand, in the further report, it was stated that the Finance Department could not be considered as responsible for the import of palmolein. The learned Enquiry Commissioner and Special Judge held, in this regard, thus: “21. It has already been found that though the further investigation was conducted to ascertain the involvement of CW23 in the impugned palmolein deal the further report filed by the Investigating Officer, does not say anything about the involvement of CW23 as the Finance Minister in the palmolein deal despite the statements of the witnesses recorded by the Investigating Officer. In the further report, it is stated that the Finance Department could not be considered as responsible for the import of palmolein. But the involvement of the Finance Department in the palmolein deal was not at all a ground advanced by the prosecution when permission was sought for conducting further investigation. But the permission was sought for conducting further investigation into the involvement of CW23 in the palmolein deal. As has already been noted, the further report does not speak about the CRL.M.C. NO.3229 OF 2011 :: 18 :: aspect of the involvement of CW23, the then Finance Minister, though the further investigation was conducted for the said purpose.” 12. The contentions raised by the petitioner are the following: He is an IAS Officer belonging to Kerala Cadre. He served the State as well as the Central Government for the past three decades. He held various posts. While the petitioner was serving the Government of India as Joint Secretary, Agriculture, he was deputed to the Organizing Committee of Commonwealth Games, Delhi, 2010 as one of the three member team selected by the Prime Minister's Office. The petitioner is facing the ordeal of the trial of the case from 2003 onwards. The pendency of the case for such a long period has affected his career adversely. While several other IAS Officers were promoted and were given appropriate posts in the Government of India, the petitioner was not considered only due to the pendency of the palmolein case. The pendency of the case has caused tremendous mental agony and social stigma to him and irreparable damage to his career prospects and reputation. Annexure IV order dated 8.8.2011 directing the investigating agency to conduct further investigation is illegal. Any such further investigation will have the CRL.M.C. NO.3229 OF 2011 :: 19 :: effect of protracting the proceedings. The petitioner pointed out that he had never approached any forum other than filing an application for discharge before the trial court and therefore, any delay in the disposal of the case cannot be attributed to him. 13. Sri.S.Rajeev, the learned counsel appearing for the petitioner, raised various contentions in an attempt to show that Annexure IV order passed by the trial court is illegal and unsustainable. He submitted that a careful reading of the order passed by the Special Judge would give a clear indication that what was ordered to be done was not a further investigation, but a reinvestigation or a fresh investigation. The learned counsel for the petitioner relied on the decision of the Supreme Court in Reeta Nag v. State of West Bengal and