IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HON'BLE THE ACTING CHIEF JUSTICE MR.J.B.KOSHY & THE HONOURABLE MR. JUSTICE P.BHAVADASAN THURSDAY, THE 12TH FEBRUARY 2009 / 23RD MAGHA 1930 WP(C).No. 2717 of 2009(S) --------------------------------------- PETITIONER(S): ------------------------ PEOPLE'S COUNCIL FOR CIVIL RIGHTS, THALASSERRY, REPRESENTED BY ITS PRESIDENT T.ASAF ALI, ADVOCATE PLEASANT CHATEAU, NEAR DISTRICT COURT, THALASSERRY- 670 101. KANNUR DISTRICT. BY ADV. MR.KALEESWARAM RAJ RESPONDENT(S): --------------------------- 1. STATE OF KERALA, REPRESENTED BY CHIEF SECRETARY TO GOVERNMENT, SECRETARIAT, THIRUVANANTHAPURAM. 2. CENTRAL BUREAU OF INVESTIGATION REPRESENTED BY THE OFFICER IN CHARGE CENTRAL BUREAU OF INVESTIGATION, NEW DELHI. 3. SUPERINTENDENT OF POLICE, SPE CBI, ACB CHENNAI. 4. KERALA STATE ELECTRICITY BOARD, REPRESENTED BY THE SECRETARY, KERALA STATE ELECTRICITY BOARD, VAIDHYUTHI BHAVAN, PATTOM, , THIRUVANANTHAPURAM. Kss ..2/- ...2..... WPC.NO.2717/2009 S * 5. SECRETARY TO GOVERNMENT, DEPARTMENT OF HOME AFFAIRS, NEW DELHI. CORRECTED AS: * UNION OF INDIA, REPRESENTED BY SECRETARY TO GOVERNMENT, MINISTRY OF OF HOME AFFAIRS, NEW DELHI. * ADDRESS OF 5TH RESPONDENT IS CORRECTED AS PER ORDER DTD. 12/02/2009 IN I.A.NO.1245/2009 **ADDL.R6 TO R16 ARE IMPLEADED: R6. SHRI.PINARAYI VIJAYAN, S/O.LATE KORAN, (FORMER MINISTER FOR ELECTRICITY), AKG APARTMENTS, PALAYAM, THIRUVANANTHAPURAM. R7. SHRI.K.MOHANACHANDRAN, S/O.LATE SHRI.KESAVA PILLAI, FORMER PRINCIPAL SECRETARY, POWER & CHAIRMAN, KSEB, 'ABHILASH', GOLF LINKS ROAD, KOWDIYAR, THIRUVANANTHAPURAM. R8. SHRI. K.G.RAJASEKHARAN NAIR, S/O.LATE P.K.GOPALA PILLAI, (RETIRED FINANCE ADVISOR & CHIEF ACCOUNTANT OFFICER, KSEB), “SURABHI”, KRISHNA GARDENS, GOLF LINKS ROAD, KOWDIAR, THIRUVANANTHAPURAM. R9. SHRI. MATHEW ROY, S/O.LATE N.MUTHU NADAR (RETIRED MEMBER, ELECTRICAL, KSEB), DR.DEVASWAM LANE, KESAVADASAPURAM, THIRUVANANTHAPURAM PARAPPAD HOUSE, VERKILAMBI, THAKKALA, KANYAKUMARI. R10. SHRI. R.SIVADASAN, S/O.LATE DR.N.RAGHAVAN, (FORMER BOARD CHAIRMAN, KSEB), C-108, ANANDLOK APARTMENTS, MAYUR VIHAR, PHASE I, NEW DELHI – 91. Kss ...3/- ....3...... WPC.NO.2717/2009 S R11. SHRI. M.KASTHOORI RANGA IYER, S/O.LATE MAHADEVA IYER (RETIRED CHIEF ENGINEER (GENERATION) KSEB) Z/245, NAGAMMANIAH STREET, KARAMANA, THIRUVANANTHAPURAM. R12. SHRI. R.GOPALAKRISHNAN, S/O.LATE P.K.RAGHAVAN, (FORMER MEMBER (ELECTRICITY),KSEB), PADMAVILAS, MAYYANAD ROAD, KOTTIYAM, KOLLAM. R13. SHRI. P.A.SIDHARTHA MENON, S/O.LATE N.ACHUTHAN NAIR, (FORMER CHAIRMAN, KSEB), 'SHANKAR VIHAR', PUNNAPRA P.O., ALAPPUZHA. R14. KLAUS TRIENDL, EXECUTIVE VICE PRESIDENT, S.N.C.LAVALIN INC, 455 RENE-LEVESQUE, BLVD.WEST, MONTREAL, QUEBEC, CANADA H2Z 1Z3. R15. M/S. S.N.C.LAVALIN INC, 455 RENE – LEVESQUE, BLVD.WEST, MONTREAL, QUEBEC, CANADA H2Z 1Z3. R16. SHRI.FRANCIS, S/O.A.C.JOHN, (RETIRED JOINT SECRETARY, POWER, GOVERNMENT OF KERALA) TC 6/436 (3), AKKAPADICKAL HOUSE, LAKE VIEW LANE, VATTIYURKAVU, THIRUVANANTHAPURAM. (**ADDL.R6 TO R16 ARE IMPLEADED AS PER ORDER DTD. 12/02/2009 IN I.A.NO.1593/2009) R1 BY ADVOCATE GENERAL MR. C.P.SUDHAKARA PRASAD ADDL.DIRECTOR GENERAL OF PROSECUTION MR.K.K.RAVINDRANATH BY GOVERNMENT PLEADER SMT. K.MEERA R2 & R3 BY ADV. MR.M.V.S.NAMBOOTHIRY,SC, C.B.I. R4 BY ADV. MR.C.K.KARUNAKARAN, SC FOR KSEB R5 BY MR.P.PARAMESWARAN NAIR,ASST.SOLICITOR BY ADV.K.M.SATHYANATHA MENON THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 12/02/2009 ALONG WITH WPC NO. 3391 OF 2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: Kss J.B. Koshy,Ag.C.J. & P. Bhavadasan, J. ---------------------------------------- W.P.(C) Nos. 2717 & 3391 of 2009 ---------------------------------------- Dated this the 12th day of February, 2009 Judgment Koshy, Ag.C.J. These two writ petitions are filed as public interest litigation regarding granting of sanction for prosecuting the accused in the 'SNC Lavlin Scam' which is the biggest scandal that rocked this small but literate State of Kerala. It is the contention of the petitioners that in view of the agreement executed between the Kerala State Electricity Board and SNC Lavlin, a Canadian Intermediary regarding renovation and modernisation of Pallivasal, Chengulam and Panniyar Hydro Electric projects, State has lost more than Rs.500 crores and certain persons obtained material gains of Rs.300 crores. Comptroller and Auditor General found out the great loss caused to the State. Sri.Balanandan Commission report also shows the irregularities in the above deal. State Vigilance also after investigation found grievous irregularities, corruption and loss to the State. But Vigilance enquiry pointed out more guilt on the officers rather than persons behind it. Petitioners W.P.(C) Nos.2717 & 3391/2009 2 approached this court earlier also which resulted in Ext.P1 judgment by which a Division Bench of this Court (One of us, Justice J.B.Koshy, was a member) directed the Central Bureau of Investigation (CBI) to investigate the matter, considering the earlier decision of the State Government to refer the matter to CBI. The above judgment has become final. The CBI, as per the directions of this Court, completed the investigation within the extended time frame allowed in subsequent orders. Thereafter, final report was produced before this Court in a sealed cover to show that investigation was completed. Since investigation was completed, we returned the sealed cover without opening, to the counsel for C.B.I.. It is submitted by the Standing Counsel for the CBI that application for sanction to prosecute Accused Nos.1, 9 and 10 who are two Government Officers and an Ex-Minister, was filed under section 197 of the Code of Criminal Procedure (Cr.P.C.) for the offences punishable under section 120-B and 420 of the Indian Penal Code (IPC). It is the case of the petitioners that sanction is not necessary to prosecute the accused as the offences alleged under sections 120-B and 420 of the IPC are committed not in the discharge of the official duties. It is further submitted that immediately on filing the final report, when the request reached the W.P.(C) Nos.2717 & 3391/2009 3 Government, the Home Minister made a statement that CBI investigation report is politically motivated. Hence in view of the political clout sanction may not be granted by this Government. According to the petitioner, Ex-Minister who is now arrayed as an accused in the report, is the Secretary of the political party which is a major partner of the front ruling the State and in view of his political influence Council of Ministers will not give sanction to prosecute them for obvious reasons. Therefore, it is prayed that if sanction is necessary, this court should issue a writ of mandamus for giving sanction within a reasonable time as this court should prevent politicians or bureaucrats looting the poor citizens of the country and being the guardian of the Constitution, this court shall rise to the occasion. When the case came up for admission, the learned Standing Counsel for CBI submitted that whether sanction is necessary under section 197 Cr. P.C. for prosecuting the above three accused is a question in dispute as there are divergent views expressed in various judgments and, by way of abundant caution, they filed the application for sanction and it is for the court to decide whether sanction is necessary or not and if this court is of the opinion that no sanction is necessary, CBI is ready to file the charge sheet. As held by the Apex Court that for granting sanction, the W.P.(C) Nos.2717 & 3391/2009 4 granting authority need not give an opportunity for hearing to the accused as it is not contemplated under section 197. (See: State of Maharashtra v. Iswar Piraji Kalpatri and others ((1996) 1 SCC 542) and State of Bihar and another v. P.P.Sharma and another ((1992) Suppl.(1) SCC 222), but, we thought that for deciding the question whether sanction is necessary or not, in a public interest litigation filed under Article 226 of the Constitution of India, accused also should be heard and, therefore, notice on admission was ordered to the accused also. We have also heard the counsel for the petitioners as well as counsel for the accused, apart from the learned Advocate General and Standing Counsel for the CBI. 2. Section 197 (1) of Cr.P.C. reads as follows: “197. 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, W.P.(C) Nos.2717 & 3391/2009 5 in connection with the affairs of a State, of the State Government:” The purpose of the above section is to avoid vexatious litigation against public servant for the acts done in the discharge of their duties. Sanction is a condition precedent in taking cognizance of an offence committed by a public servant while discharging official duties as held by the Apex Court in Birendra K.Singh v. State of Bihar, (2000) 8 SCC 498. Sanction is necessary before taking cognizance of an offence under section 197(1) only if the following ingredients are satisfied: (i) A public servant is accused of an offence (ii) that public servant is not removable from his office except by or with the sanction of the Government, (iii) the alleged offence committed by him should be in the discharge of his official duties or purporting to act in discharge of his official duties. There is clear difference between the wordings of Section 19 of the Prevention of Corruption Act (for short, PC Act) and Section 197 of the Cr.P.C. Section 19(1) of the P.C. Act reads as follows: “19. 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 W.P.(C) Nos.2717 & 3391/2009 6 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.”. Section 19 of the P.C. Act also requires sanction to prosecute public servants for offences punishable under that Act. But it has been the well settled law that under the Prevention of Corruption Act sanction is necessary only if the public servant is being prosecuted while in service. In other words, if at the time of filing the chargesheet if the accused is not a public servant, no sanction is necessary as decided by the Supreme Court in S.A.Venkataraman v. State, AIR 1958 SC 107, wherein it was held as follows: “14. .......... There is nothing in the words used in Section 6(1) (Sec.19 of the New Act) to even remotely suggest that previous sanction was necessary before a court could take cognizance of the offences mentioned therein in the case of a person who had ceased to be a public servant at the time the offence was committed. ........ A public servant who has ceased to be a public servant is not a person removable from any office by a competent authority.” W.P.(C) Nos.2717 & 3391/2009 7 In Parkash Singh Badal v. State of Punjab,(2007) 1 SCC 1, it was held that there is no need to obtain sanction for prosecution of a person alleged to have committed offences under the P.C. Act in the capacity of a public servant where cognizance of such offence is taken after he had already ceased to hold the office in question, though he may continue to be a public servant in any other capacity at the time of taking cognizance. But under Sec.197, the question is whether the accused is or was a public servant at the time of commission of offence. In Badal's case (supra), it was observed as follows: “12. The use of the expression “is” in Section 19 of the Act vis-a-vis the expression “is” or “was” is indicative of the legislative intent. Though certain changes were made in the Code no corresponding change was made in the Act.”. The same view was taken in K.S.Dharmadatan v. Central Government, (1979) 4 SCC 204. This view was also followed in R.S.Nayak v. A.R.Antulay, (1984) 2 SCC 183. Therefore it is clear that the relevant date with reference to which a valid sanction is sine quo non for taking cognizance of an offence committed by a public servant as required by Section 19 is the date the crime is committed and he must continue to be a public servant in that W.P.(C) Nos.2717 & 3391/2009 8 capacity on the date on which the court is called upon to take cognizance of the offence of which he is accused. But in Section 197 Cr.P.C., the question is whether at the time of alleged commission of offence, the person accused is a public servant or not. In R.Balakrishna Pillai v. State of Kerala, 1996 (1) KLT 250 (SC), it was held that sanction for prosecution of a public servant under Sec.197 of Cr.P.C. is necessary even if he ceased to be a public servant on the date of taking cognizance of the offence. Section 197 of Cr.P.C. provides for sanction for prosecution of any person who is or was a public servant. The use of the expression 'was' after the expression 'is' makes it clear that sanction is applicable even in cases where a retired or ex-public servant is sought to be prosecuted. Even without a sanction under Section 197 (1) Cr.P.C., a final report can be filed before the criminal court, but in that case, before taking cognizance the criminal court has to consider whether sanction is necessary against any of the accused in that case under Section 197 of the Code. 3. An order of sanction is an administrative act and therefore, it need not contain detailed reasons, but it should contain some reasons, so as to show that there is application of mind. In State of Bihar v. P.P.Sharma, AIR 1991 SC 1260, it was held as W.P.(C) Nos.2717 & 3391/2009 9 follows: “67. It is equally well settled that “before granting sanction the authority or the appropriate Govt. must have before it the necessary report and the material facts which prima facie establish the commission of offence charged for and that the appropriate Government would apply their mind to those facts”. The order of sanction only is an administrative act and not a quasi judicial nor a lis involved. Therefore, the order of sanction need not contain detailed reasons in support thereof as was contended by Sri.Jain. But the basic facts that constitute the offence must be apparent on the impugned order and the record must bear out the reasons in that regard. The question of giving an opportunity to the public servant at that stage as was contended for the respondent does not arise. Proper application of mind to the existence of a prima facie evidence of the commission of the offence is only a pre-condition to grant or refuse to grant sanction. When the Govt. accorded sanction, S.114(e) of the Evidence Act raises presumption that the official acts have been regularly performed. The burden is heavier on the accused to establish the contra to rebut that statutory presumption. Once that is done then it is the duty of the prosecution to produce necessary record to establish that after application of mind and consideration thereof to the subject the grant or refusing to grant sanction was made by the appropriate W.P.(C) Nos.2717 & 3391/2009 10 authority. At any time before the Court takes cognizance of the offence the order of sanction could be made. It is settled law that issuance of the process to the accused to appear before the Court is sine qua non of taking cognizance of the offence. The emphasis of S.197(1) or other similar provisions that “no court shall take cognizance of such offence except with the previous sanction” posits that before taking cognizance of the offence alleged, there must be before the Court the prior sanction given by the competent authority. Therefore, at any time before taking cognizance of the offence it is open to the competent authority to grant sanction and the prosecution is entitled to produce the order of sanction....”. 4. There is no dispute that Ministers also will come within the definition of 'public servant'. Before taking cognizance against Ministers or ex-Ministers for the alleged act in discharge of official duties or purported to be committed in discharge of official duties, Government's sanction is necessary. With regard to the Ministers, sanction has to be given by the Governor. The expression 'government' means Governor in the case of Chief Minister or a Minister. A Constitution Bench of the Honourable Supreme Court in M.Karunanidhi v. Union of India, 1979 (3) SCR 254, was required to consider whether a Chief Minister was a public servant within the meaning of S.21 of the Indian Penal Code and S.197 of the Code. W.P.(C) Nos.2717 & 3391/2009 11 The Apex Court referred to the decision of the High Court of Bombay in Namdeo Kashinath Aher v. H.G.Vartak & Anr. (AIR 1970 Bombay 385) wherein it is observed that, “whatever be the practical and actual position, the fact remains that it is the Governor who can accept the resignation of the Ministry or Minister and it is the Governor again who can dismiss or remove the Minister from office. Under S.3(60) of the General Clauses Act, 1897, the word 'State Government' has been defined. Clause (c) of S.3(60) is applicable to the present case and, therefore, the State Government is to mean the Governor for the purpose of the present case. The result, therefore, is that accused No.1 is a public servant who can be said to be removed only by the State Government, meaning thereby the Governor, and I do not find any difficulty in coming to the conclusion that the second requirement of S.197 Cr.P.C. also is fully satisfied as per the accused No.1 is concerned”. 5. It was argued that petitioners has no right to file public interest litigation because essentially prosecuting such offence is the duty of the State and once prosecution starts, the parties involved are only the accused and the State, and third parties cannot file writ petitions as public interest litigation. In support of the above contention, the respondents cited the W.P.(C) Nos.2717 & 3391/2009 12 decision of the Honourable Supreme Court in M.C.Mehta v. Union of India, (2008) 1 SCC 407, where it was held that once a final report is filed in terms of Sec.173 Cr.P.C., it is the Magistrate alone who can take an appropriate decision in the matter, which would be subject to judicial review. The possibility of prosecuting agencies not approaching the higher forum against Magistrate's order by itself would not confer jurisdiction for third parties to file a public interest litigation. In that case, it was held as follows: “Once a final report has been filed in terms of sub-section (1) of Section 173 of the Code of Criminal Procedure, it is the Magistrate and Magistrate alone who can take appropriate decision in the matter one way or the other. If he errs while passing a judicial order, the same may be a subject matter of appeal or judicial review. There may be a possibility of the prosecuting agencies not approaching the higher forum against an order passed by the learned Magistrate, but the same by itself would not confer a jurisdiction on this Court to step in. We should not entertain the application of the learned amicus curiae on such presupposition. A judicial order passed by a Magistrate may be right or wrong, but having regard to the hierarchy of the courts, the matter which would fall for consideration before the higher court should not be a subject matter of a decision of this Bench. In an unlikely event of the interested parties in not questioning such orders before the higher forum, an W.P.(C) Nos.2717 & 3391/2009 13 independent public interest litigation may be filed. Instances are not unknown where this Court has entertained public interest litigation in cases involving similar question under Article 32 of the Constitution of India. [See Rajiv Ranjan Singh Lalan (VIII) v. Union of India, (2006) 6 SCC 613]”. (emphasis supplied) The Hon'ble Supreme Court, at paragraph 14, has also observed as follows: “14. We may observe that while entertaining a public interest litigation in a given case, this Court may exercise a jurisdiction to set aside a decision of a constitutional authority, but we are not concerned with such a situation.”. 6. Here, in this case, the court has not taken cognizance and that stage has not reached. The sole question is, whether sanction is necessary or not? Once cognizance is taken and prosecution started, it is essentially a matter for the prosecution and the defacto complainant. But, at the same time, a criminal case of this nature affects the entire public, especially in a great scam regarding loss of public revenue is involved. On the basis of petitioners complaint, the CBI investigation was ordered. In fact the present Government objected investigation by the CBI. In Zahira W.P.(C) Nos.2717 & 3391/2009 14 Habibullah Sheikh (5) v. State of Gujarat, (2006) 3 SCC 374, it was held that crimes are public wrongs. The Supreme Court in the said decision held as follows: “35. .........The concept of fair trial entails familiar triangulation of interests of the accused, the victim and the society and it is the community that acts through the State and prosecuting agencies. Interest of society is not to be treated completely with disdain and as persona non grata. The courts have always been considered to have an overriding duty to maintain public confidence in the administration of justice - oftern referred to as the duty to vindicate and uphold the “majesty of law”. Due administration of justice has always been viewed as a continuous process, not confined to determination of the particular case, protecting its ability to function as a court of law in the future as in the case before it.”. The modern trend is that political scams involving crores of rupees will go unnoticed unless public spirited parties question the same. The anxiety of the petitioners is that since the CBI has asked for sanction, the matter will be delayed and in view of the present set up, it is likely that sanction may not be granted. We are of the view that since cognizance is not taken in this case, and in view of the magnitude of the scam and political backdrop, we cannot dismiss this writ petition as not maintainable, especially when public interest W.P.(C) Nos.2717 & 3391/2009 15 is involved. 7. Now, we will come to the main question. Whether sanction is necessary for prosecuting public servants for offences punishable under Section 120-B and 420 of the Indian Penal Code. Both sides cited various decisions from 1955 to 2007 in support of their views. In Om Prakash v. State of U.P., AIR 1957 SC 458, it was held that no sanction is necessary to prosecute the public servant as he does not normally act in his capacity as a public servant when committing criminal breach of trust. The court held as follows: “30. The last argument of Mr.Issac is that despite the fact that prosecution is under S.409, Penal Code, still sanction to prosecute is necessary. Quite a large body of case law in all the High Courts has held that a public servant committing criminal breach of trust does not normally act in his capacity as a public servant, see (a) The State v. Pandurang Baburao, AIR 1955 Bom.451, (b) Bhup Narain Sexana v. State, AIR 1952 All.35, and (c) State v. Gulab Singh, AIR 1954 Raj. 211. We are in agreement with the view expressed by Hari Shankar and Randhir Singh, JJ. that no sanction is necessary and the view expressed by Mulla, J.