IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 01/11/2002 CORAM THE HON'BLE MR.JUSTICE MALAI.SUBRAMANIAN CRIMINAL APPEAL NO.248 OF 1996 and CA.Nos 249 and 255 of 1996 1. Balagovindarajulu .. Appellant/A1 in CA248/1996 1. K. Bhuvanendran 2. R.M. Palaniswami ..Appellants/ A3 & A6 in CA 249/1996 1. C. Thangapandi 2. R. Rajendran 3. S. Raju ..Appellants/ A2,A4 & A5 in CA 255/1996 -Vs- State rep. By the Inspector of Police Vigilance and Anti Corruption Coimbatore (crime No.6/AC/86/CB) .....Respondent Appeal filed under Section 374(2) of Cr.P.C. against the conviction and sentence passed by the learned Additional Special Judge/I Additional Sessions Judge cum Chief Judicial Magistrate, Coimbatore in Special Calendar Case No.5/89 dated 14.3.1996. !For appellants 2,4 and 5 .. Mr.R. Shanmugasundaran in C.A.No.255/86 Senior Advocate for Mr.S.N. Thangarai and M. Mugundan For 1st appellant in .. Mr.K. Asokan.Sr. Counsel C.A.No.248/96 for Mr.Sundar Mohan For appellants 3 and 6 in C.A.No.255/96 .. Mr.A. Balaguru for Mr.P.S. Venkatasubramanian ^For respondents .. Mr.E. Raja Addl. Public Prosecutor :JUDGMENT The accused 1 to 6 in Special Calendar Case No.5/89 on the file of Additional Special Judge/I Additional Sessions Judge cum Chief Judicial Magistrate, Coimbatore were convicted and sentenced to undergo R.I for 3 years and to pay a fine of Rs.3,000/- each, in default to suffer R.I for 6 months for offence punishable under Sec.477-A IPC; to undergo R.I for 3 years and to pay a fine of Rs.3,000/- each, in default to suffer R.I for 6 months for offence punishable under Sec.420 IPC and to undergo R.I for 3 years and to pay a fine of Rs.3,250/-, in default to suffer R.I for 6 months for offence punishable with 5(2) read with 5(1)(d) of Prevention of Corruption Act, 1947. Though they were convicted for offences punishable under Sec.120-B read with Sec.47 7-A, 420 and 5(2)read with 5(1)(d) of Prevention of Corruption Act, no separate sentences were imposed for that offence. The sentences were ordered to run concurrently except the default sentence for non payment of fine which has to run consecutively. The 1st accused challenging the above conviction and the sentence has filed C.A.No.248/96; 2nd, 4th and 5th accused have filed C.A.No.255/96 and 3rd and 6th accused have filed 249/96. Since all the three appeals arise out of a single judgment, the following common judgment is pronounced on appeal. For convenience, the appellants will be referred to as accused 1 to 6 in the same order in which they were arrayed before the trial court. They were convicted on an allegation that A.1 to A.6 being public servants entered into a criminal conspiracy between May 1983 and April 1985 to cheat the TWAD Board by claiming amounts more than actually due for the execution of the work relating to the supply of Siruvani water to Bharathiar University and Maruthamalai Temple Adivaram in Coimbatore area by recording false measurement in the measurement book relating to those works and by abusing their position as public servants have obtained pecuniary advantage to the tune of Rs.55,846.82 for themselves and for the approvers T. Guruswami – P.W.14, P. Sivakaminathan – P.W.15. The brief facts required to dispose of the appeal are as follows: 2. The 1st accused was the Executive Engineer, TWAD Board, Siruvani Special Division II, Coimbatore from 22.8.83 to 30.4.85; 2nd accused was then the Assistant Executive Engineer in Special Division III between 2.1.80 and 31.7.83 and in Special Division II from 31.7.83 to 21.2.85; 3rd accused was the Assistant Executive Engineer in Special Division – II from 1.10.1983 to 30.4.1985; 4th accused was the Junior Engineer in Special Division III from 1.2.82 to 31.7.83 and in Special Division II from 31.7.83 to 6.8.85; 5th accused was the Assistant Engineer in Division No.II from 6.10.82 to 5.6.84 and 6th accused was the Assistant Engineer in the same Division from 8.9.83 to 30.4.85. The TWAD Board resolved to approve Coimbatore Water Supply Augment Scheme with Siruvani as source, for extending water supply to Bharathiar University and Maruthamalai Temple Adivaram. Technical sanction was also accorded by Chief Engineer, Madras. The TWAD Board also granted approval for the same. 3. The above scheme was divided into two: 1) Laying, joining and testing of 250 mm class 10 AC pipes from common pump house to sump at Bharathiar University; 2) Laying, joining and testing of 100 mm dia mtr class 15 AC pipes from sump at Bharathiar University to Maruthamalai Temple Adivaram. Tenders were invited. The tender of P.W.14 Guruswami was approved and Ex.P.15 Work Order was awarded to him for the first work. The tender of P.W.15 Sivakaminathan was approved and Ex.P.8 work order was awarded to him for the second work. Besides these work orders, certain portions of both the works were covered under various written understandings Exs.P.23 to Ex.P.37. 4. The 1st accused, formerly Executive Engineer; the 2nd accused, Assistant Executive Engineer and the 4th accused,Junior Engineer along with P.W.14 Guruswami entered into a criminal conspiracy to cheat the TWAD Board by claiming amounts more than actually payable and the 2 nd and 4th accused prepared fictitious trial pit particulars and recorded false measurements and check measurements in the measurement books. The 1st accused passed the bills without any super check. The work was also conveniently split up into several parts so as to bring the value of each work within the financial competency of the sanctioning authority. Insofar as the work relating to Bharathiar University, the 4th accused made measurements and the 2nd accused check measured the same. 4. A.1, A.2, A.3, A.5 and A.6 entered into a criminal conspiracy with P.W.15 to cheat the TWAD Board by claiming more amounts actually payable for the execution of the work viz., supply of Siruvani Water to Maruthamalai Temple by recording false measurements and check measurements in the measurement book. A.5 and A.6 recorded the measurements in respect of Maruthamalai Temple. A.2 and A.3 check measured the same and A.1 passed the bill without any super check. They have also violated by taking some works under written understandings even for the reach covered within the main agreement. The written understanding Exs.P.25 and P.26 were granted in favour of P.W.14 without terminating the main agreement. 5. They have also committed malpractice in the classification of soil to be excavated. Air pit walls were included for payment of bills though they were not originally covered under the agreement. During measurement, the 3rd accused has wrongly noted the thickness of the slabs as 18 cms while the same is actually 15 cms. 6. A preliminary enquiry was taken up by the Department of Vigilance and Anti-Corruption and the Deputy Superintendent of Police, who conducted the secret enquiry sent his report dated 17.11.84 to the Director of Vigilance and Anti Corruption, Chennai. Thereafter, P.W.37 – Inspector of Police, Vigilance and Anti-Corruption, Coimbatore was asked by the Director of Vigilance and Anti Corruption to make a detailed enquiry against the 2nd accused. P.W.37 sought the assistance of a retired Executive Engineer by name Ayyavu, who was originally working in the Department of Vigilance and Anti-Corruption. P.W.37 received a report from the said Ayyavu on 4.11.85. After verifying the report, P.W.37 submitted a detailed report to the Director of Vigilance and Anti-Corruption on 26.1.86. On the direction of the Director, Vigilance, a case was registered against A.1 to A.6, P.W.14 and P.W.15 for the offences punishable under Secs.120-B, 167, 420,477-A and 109 IPC and Sec.5 (1)(d) read with 5(2) of Prevention of Corruption Act, 1947. P.W.37 made a request for the technical assistance of an Executive Engineer and accordingly, P.W.28 Mr. Purushothaman, who was then working as Executive Engineer, P.W.D (Buildings) at Coimbatore was appointed under Ex.P.62, Proceedings of the Chief Engineer, P.W.D( General), Madras-5. 7. P.W.28 was instructed to find out the extent of substandardness in the execution of the above work and the boosted up false measurements recorded by the Officials by carrying out super check of the suspected work. Accordingly, P.W.28 received the documents from P.W.37. Since the pipe lines were laid underneath the earth, the services of P.W.29 – Assistant Engineer, TWAD Board, Coimbatore was also utilised for digging model pits in accordance with the sketches prepared for the pipe lines. P.W.29 dug 60 pits to enable P.W.28 to ascertain the classification of the soil and the measurements of the sand bedding. P.W.28 along with P.W.27 in the presence of accused 2,3,4,5 and 6 commenced his work on 9.4.88. He then super-checked the measurements relating to sand bedding and also noted the classification of the soil in Ex.P.23 report along with Ex.P.64 measurement book. When the actual measurements taken by him were compared with the estimation of the work allotted insofar as Bharathiar University agreement No.11 is concerned, the loss to the Government was estimated as Rs.33,745.21 and with regard to Maruthamalai Temple Agreement No.4, the loss was Rs.20,988.70. P.W.28 gave his report to P.W.37 on 18.10.88. P.W.37 collected certain other documents from different Departments. 8. On 24.11.88, P.W.37 arrested P.W.15 at 10.00 a.m and questioned him. Exs.44 Savings Accounts Pass Book and Ex.P.45 pocket note book were seized. Then P.W.15 was released on bail. A requisition was given to the Chief Judicial Magistrate, Coimbatore for recording a statement under Sec.164 Cr.P.C from P.W.15. The statement of P.W.15 was recorded and he was tendered pardon. On 10.2.89 at about 10.00 a.m, P.W.14 was arrested and questioned. A request was made to record a statement under Sec.164 Cr.P.C from P.W.14. The said statement was also recorded and he was also tendered pardon. After completing investigation P.W.37 submitted his final report to Director of Vigilance and Anti-Corruption along with all the records. The Director forwarded the same to the Managing Director, TWAD Board for according sanction to prosecute the accused. Sanction was accorded under Ex.P.82. Thereafter, P.W.37 filed a final report against all the accused before the Court. 9. When the trial Court questioned the accused under Sec.313 Cr.P.C, they denied their complicity in the commission of the offence and no witnesses were examined on their side. 10. There is no dispute that A.1 to A.6 were concerned with the execution of the work relating to supply of Siruvani water to Bharathiar University and Maruthamalai Temple Adivaram in Coimbatore area. There is also no dispute that during the relevant period, the 1st accused was the Executive Engineer; 2nd and 3rd accused were the Assistant Executive Engineers, 5th and 6th accused were the Assistant Engineers and the 6th accused was a Junior Engineer in TWAD Board, Coimbatore. Two schemes were drafted; one for Bharathiar University and the other for Maruthamalai Temple Adivaram. P.W.2, while working as Drafts Man in Siruvani Augmentation of Water Supply Scheme during the period 1.2.80 to 31.7.83, on the instructions of the then Executive Engineer Mr.N. Natarajan, prepared tender schedule Ex.P.13 to take water from Siruvani Pump House to Bharathiar University. The comparative Statement is Ex.P.14. Tender Notification is Ex.P.15. Ex.P.16 is the acceptance letter of P.W.14. This work was approved by S. Natarajan, the then Executive Engineer. With regard to the above aspect, there is no dispute by any of the appellants. 11. The scheme relating to taking water from Bharathiar University to Maruthamalai Adivaram was prepared by P.W.1, a senior Drafts Man of TWAD Board. The same was prepared on the instructions of the then Executive Engineer S. Natarajan. The detailed estimate is Ex.P.1 and the same was prepared by the Executive Engineer Varadamani, Assistant Executive Engineer, Chennai. Ex.P.3 is the concerned register. According to P.W.1, P.W.15 the lowest bidder was given the work allotment. P.W.1 would say that A.1 has also approved the tender. Ex.P.12 Entry in the register was also countersigned by the 3rd accused. Ex.P.12 was prepared by the 6th accused. There is no dispute with regard to the above aspects also. The only contention of the learned Senior Counsel Mr.R. Shanmugasundaram, who appeared for 2nd,4th and 5th accused is that out of Rs.6,000/-, only Rs.4,500/- was given to the Contractor and the remaining Rs.1,500/- has not been given. 12. Insofar as A.3 and A.6 are concerned, the allegation against them is that as per the agreement, the slabs for covering the pits should have 18 cms thickness, whereas as per Ex.P.10 measurement books, it was only 15 cms. 13. The learned senior counsel Mr.K. Asokan appearing for the 1st accused contends that the only allegation against the 1st accused is that without making super check he signed the bills. He drew my attention to the evidence of P.W.1, who would say that the work was allotted to P.W.15 only legally. Of course, there is no dispute at all insofar as the allotment is concerned. The learned senior counsel points out that P.W.4, Accounts Officer during the course of his cross examination admits that super check has to be done by the Executive Engineer only when the estimate of work exceeds Rs.1 lakh. Admittedly, in this case the work allotment for P.W.14 was for Rs.90,135.30, while the work estimate for P.W.15 is Rs.84,993/-. Since both the estimates run below Rs.1 lakh, the learned senior counsel contends on the basis of the admitted evidence of P.W.4 that the 1st accused cannot be fastened with any liability for not conducting super check. This contention seems to be well founded. P.W.7, Junior Engineer also admits that there was no audit objection and no remarks of inspection also by the superior authorities insofar as the pipe line work are concerned. The learned senior counsel brings to the attention of this Court regarding the absence of sanction to prosecute the 1st accused. Ex.P.82 the sanction order filed in this case reads this: "Whereas it is now found that the sanction proceedings in respect of Thiru.A. Balagovindarajulu is void ab initio for want of competence of the Managing Director, TWAD Board, to accord sanction in respect of him". 14. No other sanction order was produced to prove the according of sanction to prosecute the 1st accused. Of course Ex.P.81, Order of TWAD Board dated 13.7.89 reads that sanction was accorded for prosecution of the 1st accused also. Subsequently, the sanctioning authority came to know his incompetency and therefore, the second sanction order Ex.P.82 dated 8.7.92 was made. Therefore, virtually, there was no sanction to prosecute the 1st accused at all. The 1st accused, being an Officer of the Government, can be removed only by the State Government. No sanction order was obtained from the State Government to prosecute him. On these contentions, the learned senior counsel Mr.K. Asokan seeks acquittal of the 1st accused. 15. Insofar as 1st accused is concerned, besides non filing of any sanction order, admittedly he was not responsible for super check. The only allegation against him is that he failed to do super check of the work before passing the bills. When he is not expected to do the super check legally, he cannot be fastened with any liability. The final bill has not yet been sanctioned to either of the Directors viz., P.W.14 and P.W.15. The Executive Engineer can inspect the work given at the time of execution of the first final bill and in case any malpractice was found during the execution of the work, he is empowered to refuse sanction of bills for the work which was not done. That stage admittedly has not reached. More over , the absence of sanction to prosecute the 1st accused was challenged even before the trial court, P.W.36, the Managing Director of TWAD Board in his cross examination has admitted that he did not issue the sanction order to prosecute the 1st accused. Moreover, P.W.35, Chairman and Managing Director of TWAD Board who was in Office prior to P,.W.36, though would say he is empowered to accord sanction to prosecute the 1st accused, the contents of Ex.P.82 nullifies his evidence. Since Ex.P.82 categorically speaks that sanction proceedings in respect of the 1st accused is void ab initio for want of competence of the Managing Director, TWAD Board to accord sanction in respect of him and since the question of sanction was raised even at the trial stage itself , the absence of sanction order in this case has necessarily caused prejudice to the 1st accused. Therefore, I am of the view that the 1st accused both on the ground of absence of sanction and on the ground that he is not legally bound to super check the above works, is entitled to an acquittal. 16. Before entering into the factual matrix with regard to the allegation against A.2 to A.6, certain legal objections raised by the learned senior counsel Mr.R. Shanmugasundaram, deserve consideration. 17. The first and foremost attack was on the validity of the sanction order Exs.P.81 and P.82. The learned senior counsel submits that in the absence of sanction under Sec.197 Cr.P.C, conviction of the appellants for offences punishable under Secs.477-A, 420 and 120-B IPC is bad. According to him, sanction accorded under Sec.19 of the Prevention of Corruption Act 1988 also is bad, since the accused were charged for the offence punishable under Sec.5(2) read with 5(1) (d) of Prevention of Corruption Act,1947. He made distinction between sanction under Sec.197 and sanction under Sec.6 of the Prevention of Corruption Act, 1947 and according to him a single sanction order will not serve the purpose. 18. Ex.P.81 dated 13.7.89 was later modified by Ex.P.82 dated 8.7.9 2. Though in Ex.P.81, sanction was accorded to prosecute all the accused by the then Managing Director, it was later found out that the sanction proceedings in respect of the 1st accused is void ab initio for want of competence of the Managing Director, TWAD Board to accord sanction in respect of him. Another sanction proceedings was issued. Though the learned senior counsel contends that, according sanction under the Prevention of Corruption Act alone is insufficient to prosecute the accused for offences punishable under Indian Penal Code, both the sanction orders only reveal that the sanctioning authority was conscious of the prosecution against the accused for offences punishable under Secs.120-B read with 477-A and 420 IPC and under Secs.477A and 420 IPC also. 19. Sec.197 Cr.P.C is a general provision, not confined to Indian Penal Code alone. Any Public Servant accused of any offence alleged to have been committed by him while acting or purporting to act in discharge of his official duty, can be prosecuted only after a sanction to prosecute was accorded by either the Central Government or State Government as the case may be. Moreover, sanction is required to prosecute a public servant who is not removable from office except by the Government or with the sanction of the Government. The accused 2 to 5 can be removed from service by the Managing Director cum Chairman of the TWAD Board. This part of evidence of P.W.35 and P.W.36 is not challenged. None of the accused except the 1st accused took a plea that he was not removable by any competent authority except the Government. Since admittedly, A.2 to A.5 are not public servants removable from office either by the Government or with the sanction of the Government, Sec.197 Cr.P.C is not at all helpful to them. This position is strengthened by a ruling of the Apex Court reported in 1998 SCC (Crl) 1265 (Mohd. Hadi Raja vs State of Bihar). The relevant passages are hereunder: "It is to be noted that though through the contrivance or mechanism of corporate structure, some of the public undertakings are performing the functions which are intended to be performed by the State, ex facie, such instrumentality or agency being a juridical person has an independent status and the action taken by them, however important the same may be in the interest of the State cannot be held to be an action taken by or on behalf of the Government as such within the meaning of Section 197 Cr.P.C" .......... "The importance of the public undertaking should not be minimised. The Government's concern for the smooth functioning of such instrumentality or agency can be well appreciated but on the plain language of Section 197 of the Code of Criminal Procedure, the protection by way of sanction is not available to the officers of the public undertaking because being a juridical person and a distinct legal entity, such instrumentality stands on a different footing than the government departments. It is also to be indicated here that in 1973, the concept of instrumentality or agency of State was quite distinct. The interest of the State in such instrumentality or agency was well known. Even then, the legislature in its wisdom did not think it necessary to expressly include the officers of such instrumentality or the government company for affording protection by way of sanction under Sec.197 Cr.P.C. It will be appropriate to notice that whenever there was a felt need to include other functionaries within the definition of "public servant", they have been declared to be "public servants"under several special and local acts. If the legislature had intended to include officers of an instrumentality or agency for bringing such officers under the protective umbrella of Section 197 Cr.P.C, it would have done so expressly. Therefore, it will not be just and proper to bring such persons within the ambit of Section 197 by liberally construing the provisions of Section 197. Such exercise of liberal construction will not be confined to the permissible limit of interpretation of a statute by a Court of law but will amount to legislation by court. Therefore, in our considered opinion, the protection by way of sanction under Section 197 of the Code of Criminal Procedure is not applicable to the officers of government companies or the public undertakings even when such public undertakings are "State" within the meaning of Article 12 of the Constitution on account of deep and pervasive control of the Government". 20. Insofar as the other contention is concerned, it has to be seen whether sanction accorded under the new Act is bad inasmuch as the prosecution was launched under the repealed Act. In this case, the First Information was launched on 11.6.86 and after investigation final report was filed according to P.W.37 only on 6.10.89. The new Act came into force on 9.9.88. Though the final report was filed after coming into force of the new Act by no stretch of imagination, the accused could be prosecuted for the offence under the new Act. They can be prosecuted for the offence which was in the statute at the time of commission of the offence and they cannot be prosecuted for a new offence or a different offence by virtue of the repealing act. But at the same time, Sec.30 of the New Act saves anything done or any action taken or purported to have been taken or done under or in pursuance of the Act so repealed shall insofar as it is not inconsistent with the provision of this Act, be deemed to have been done or taken under or in pursuance of the corresponding provision of the Act. This provision only means that any action taken under the old Act shall be deemed to have been taken under the corresponding provision of this Act. The Supreme Court considered the applicability of Sec.19(3) of 1988 Act to the cases initiated under the repealed Act. In the case of Central Bureau of Investigation vs V.K. Sehgal and another reported in 1999 SCC (Crl) 1494, the Apex Court has held as follows: "Moreover, the present prosecution was launched under the 1947 Act, but by the time the case reached final stage in the trial court, the 1 947 Act was repealed by the Prevention of Corruption Act, 1988 ( hereinafter referred to as "the 1988 Act") which came into force on 9.9.19 88. The prosecution and the trial thereafter continued by virtue of sub-section (2) of Section 30 of the 1988 Act. In view of Section 6 of the General Clauses Act, 1897, "unless a different intention appears" in the 1988 Act the repeal of the 1947 Act will not affect any penal liability