CWP No.12539 of 2010 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH CWP No.12539 of 2010 Date of Decision: 22.12.2011 Pawan Kumar ..... Petitioner Versus State of Punjab and others ..... Respondents CORAM:- HON'BLE MR. JUSTICE M.M. KUMAR HON'BLE MR. JUSTICE RAJIV NARAIN RAINA Present: Mr. Sapan Dhir, Advocate, for the petitioner. Mr. Suvir Sehgal, Addl. AG, Punjab, for respondent Nos.1 to 6. Mr. Ashok Gupta, Advocate, for respondent No.7. 1. To be referred to the Reporters or not? 2. Whether the judgment should be reported in the Digest? RAJIV NARAIN RAINA, J. 1. This petition has been filed by way of Public Interest Litigation under Art 226 of the Constitution highlighting the Stamp Scam that came to light in Tehsil Complex at Hoshiarpur, Punjab during the period 2006-09 involving loss of Rs.76.6 lacs to the State Exchequer. The loss is said to have been occasioned by registration of sale deeds by withholding requisite stamp duty payable on such sale deeds. This has been occasioned with the active participation of certain Tehsildars of the District while acting as Sub Registrars and various Deed Writers, Stamp Vendors etc. The petitioner claims to be an elected District President of the Democratic Bhartiya Samaj Party, Hoshiarpur who has been working for the cause of society since 1998 CWP No.12539 of 2010 -2- by highlighting corruption in public offices. The prayer in this PIL is for disclosing action taken on the report of the Additional Deputy Commissioner, Hoshiarpur indicting certain officials and private persons involved in the Scam and for directions to CBI or any other independent agency to investigate what is termed as the Stamp Scam. 2. The facts are that on 26.10.2005 the Government of Punjab in the Department of Revenue and Rehabilitation (Stamp and Registration Branch) issued executive instructions on the subject of deposit of stamp duty at the counters of the State Bank of India (for short SBI). These instructions have been issued in amplification of an amendment carried out in Section 2 of the Indian Stamp Act, 1989 (for short 'the Act') by the Finance (No.2) Act, 2004 (No.23 of 2004) published in the Gazette of India on 10.09.2004. This amendment extends the meaning of the word “Stamp” and reads thus:- “(26) “Stamp” means any mark, seal or endorsement of any agency or person duly authorized by the State Government, and includes an adhesive or impressed stamp, for the purpose of duty chargeable under this Act.” 3. This amendment enables the State Government to select mode of payment of stamp duty by means of any mark, seal or endorsement by any agency or person duly authorized by the State Government for collection of duty chargeable under the Act. Through instructions dated 26.10.2005 (P-1) the Punjab Government decided that stamp duty should be deposited in cash at the counters of the SBI at District Headquarters where such branches of the SBI exist. It was further decided that where stamp duty amounting to Rs.20,000/- or more is involved in a single transaction it shall be deposited by the vendor/vendors, as the case may be, at the branches of SBI where CWP No.12539 of 2010 -3- Government receipts are accepted. The Sub Registrars/Joint Sub Registrars / Tehsildars were restrained from accepting stamp duty for amounts of Rs.20,000/- or more through stamps/stamp papers from the date from which the SBI permits or accepts such deposits. In order to give effect to the substantive decision, the instructions laid down the procedure to be observed at the counters of SBI for deposit of stamp duty. Para 4 (vi) makes it mandatory for the Registering Officer to act in the following manner:- “4 (vi) The Registering Officer shall verify the deposit of stamp duty in State Bank of India as shown in the receipt presented to him by the depositor from branch of the state bank of India through internet, before releasing the instrument to the executant/executer of the instrument. The modem for the purpose of internet shall be purchased by the Registering Officer through the Deputy Commissioner out of existing budget provisions.” (underlined for emphasis) 4. The above process involves modern internet/online banking ensuring instant compliance of the law. The liability to buy the modem for purpose of the internet connection rested on the Registering Officer through the Deputy Commissioner out of existing budget provisions. A public obligation and duty is placed on the RO. 5. We have heard the learned counsel for the parties at considerable length and examined the materials placed on record. 6. Mr Sapan Dhir, learned counsel for the petitioner submits that as the procedure laid down in Para 4 (vi) of the instructions had not been followed and put in immediate practice by the Registering CWP No.12539 of 2010 -4- Officer/Tehsildars, the Stamp Scam could have been avoided. He submits that when a thing is required to be done in a particular manner it shoud be done in that manner or not at all. This principle would apply with greater vigour in cases involving fiscal matters where non compliance with procedure laid down can easily point to corruption or corrupt practice. What is imputed is that the system put in place was not operated for extraneous considerations to line private pockets. The petitioner states in the petition that this huge Stamp Scam involved three Tehsildars/Naib Tehsildars named in the petition, two Registration Clerks, two officers from the Department of Treasury, Assistant Treasurer and the Treasury Officer and various officers/officials from the offices of the Auditor General, Punjab and Inspector General, Registration Punjab, Jalandhar in connivance with the officers/officials of the SBI, Hoshiarpur. The criminal law against the accused was set in motion by one Shiv Walia, a businessman who lodged an FIR No.96 dated 04.08.2009 under Sections 420, 467, 468, 471 IPC at Police Station, City Hoshiarpur against the stamp vendor namely Vickey Malhotra. The SDM, Hoshiarpur reported the matter to the Deputy Commissioner, Hoshiarpur who nominated the Additional Deputy Commissioner to conduct a detailed enquiry and submit a report. In the enquiry report dated 7.09.2009 that followed a large number of persons were found guilty in the Stamp Scam. The three Tehsildars/Niab Tehsildars were suspended on 24.09.2009 but five days thereafter on 29.09.2009, they were reinstated in service pending enquiry. That despite having been indicted, no action was taken against the guilty and accordingly the petitioner states that he preferred an application dated 19.04.2010 under the CWP No.12539 of 2010 -5- Right to Information Act, 2005 requesting action taken against guilty persons involved in the scam. That is how the petitioner came into possession of the enquiry report as well as noting sheets of the Revenue Department, Punjab through PIO letter 26.04.2010 (P-5). It is in this background that the petitioner has approached this Court praying that directions be issued for investigation of the case by the CBI or any other independent agency in the light of the fact finding report prepared by the Inspector General of Registration, Punjab, Jalandhar and that the guilty be accordingly prosecuted under the penal law, service law and under Section 81 of the Registration Act which provision deals with penalties for offences commited under the Registration Act. The petitioner has also sought directions to the respondents requiring them to explain as to why no action is being taken against the guilty officers/private persons till date. 7. On notice having been issued, the respondents put in appearance and filed their responses. On 05.07.2011 a statement was made before this Court by the learned counsel for the State that departmental enquiry against the delinquent officials was under way and it would be concluded within one month and follow up action would be taken in further one month. Upon this statement, the respondents were required to file an affidavit of compliance and the matter was posted for 17.10.2011. On 17.10.2011 further time was prayed for by the learned State counsel on the ground that final order on the enquiry report was yet to be passed by the Financial Commissioner. On 09.11.2011 an affidavit was filed by the Deputy Commissioner, Hoshiarpur in Court annexing the report of enquiry conducted by the Financial Commissioner, Punjab which exonerates the CWP No.12539 of 2010 -6- officials and thus the matter was set down for hearing on 22.12.2011. 8. We have perused the order passed by the Financial Commissioner and are of the considered view that the explanation tendered by the delinquents could not have been accepted as there was wanton disregard to the instructions dated 26.10.2005 (P-1). According to clause 6 of the instructions, the Registering Officer himself was required to verify the amount deposited in the SBI, Hoshiarpur Branch. It is no excuse and defence to the charge that that no such on-line service was commenced by the SBI and, therefore, there was no duty cast to verify the amount deposited in the Bank. It is an admitted fact that there was fabrication of the amount deposited and reflected in the papers presented before the Registering Officer. This proves fabrication and participation by the delinquents. In the aforesaid circumstances the fabrication cannot be ruled out and needs to be probed in depth. In our considered view the enquiry report and exoneration of the delinquent officials is not in order. 9. The Financial Commissioner has passed the buck to the SBI by holding that he had come to the conclusion that the SBI Hoshiarpur did not take necessary steps in time and, therefore, the Tehsildar/Naib Tehsildars had not acted in an irresponsible manner nor they infringe Government instructions. Unfortunately, the charge-sheets have been improperly dropped by the Financial Commissioner without dealing with the provisions of Para 4 (vi) of the Punjab Government instructions which were required to be adhered to and implemented by public servants holding office of public trust. That trust was breached, and we are afraid to say, so clumsily and casually by the Financial Commissioner which leaves bad taste. It is not the CWP No.12539 of 2010 -7- case stated or argued before us by any of the respondents that due steps were taken by the Registering Officer/Tehsildars for purchase of modem, a step so fundamental in compliance of the Government instructions. It ought to have been the first step in the direction of compliance of provisions of Para 4(vi) which without doubt had to be taken by the Registering Officer. Any reasonable man would have taken the view we take borne out of the plain language of Para 4 (vi). The SBI could not be blamed so easily as has been done by the Financial Commissioner in his report. It was the principal duty of the Sub Registrar/Joint Sub Registrar and Registration Clerks that before attesting any vasika the required stamp duty to be affixed should be checked. The Tehsildars had failed to put the entire system on-line with the SBI. There is procedural illegality and mala fides writ large in this case inasmuch as things which were required to be done in a particular manner were not so done with dubious intentions and for considerations other than law. The criminal complicity of the dramatis personae cannot be ruled out. We are of the considered view that the matter needs fair and impartial investigation by an independeant agency to unravel the truth in public interest and bring the guilty to book. We, however, reject the prayer for a CBI investigation in view of the law laid down by the Constitution Bench of the Supreme Court in 'State of West Bengal and others v. Committee for Protection of Democratic Rights, West Bengal & others', (2010) 3 S.C.C. 571, that the extraordinary power under Article 226 in a case where directions are sought to CBI to conduct investigation "must be exercised sparingly, cautiously and in exceptional situations where it becomes necessary to provide credibility and instil confidence in investigations or CWP No.12539 of 2010 -8- where the incident may have national and international ramifications.....Otherwise CBI would be flooded with a large number of cases and with limited resources may find it difficult to properly investigate even serious cases and even lose credibility and purpose when unsatisfactory investigations". On the material presented before us, we are satisfied that investigation at the hands of the Vigilance Bureau, Punjab in this case would meet the ends of public justice. We, therefore, dispose of this petition with the following directions without expressing any opinion on the merits which lie exclusively in the domain of investigation:- (1) That proceedings under FIR No.96 dated 04.08.2009 under Sections 420, 467, 468, 471 IPC at Police Station, City Hoshiarpur be expedited by the trial Court in case challan has been presented. (2) The Vigilance Bureau, Punjab would investigate the case expeditiously by ignoring the report of the Financial Commissioner, Punjab. It will be free to file fresh FIR against all public and private persons found involved in the Stamp Scam, investigate the same, and thereafter act in accordance with law and take the matter to its logical conclusion. (3) The status report of action taken after passing of this order be submitted to this Court at the end of six months from the date a copy of the order is served on the respondents. (M.M. KUMAR) (RAJIV NARAIN RAINA) JUDGE JUDGE 22.12.2011 manju