Crl. M.C. No.1945/2007 Page 1 of 28 * HIGH COURT OF DELHI : NEW DELHI Judgment reserved on: 28.05.2008 + Judgment delivered on: 08.09.2008 % CRL. M.C. No.1945/2007 & Crl.M.A.11358/07 Pankaj Kumar ...Petitioner Through: Mr. D.C. Mathur, Sr. Advocate with Mr. Vikram Singh Panwar, Advocate versus State ...Respondent Through: Mr. Shalinder Sharma and Mr. Rajneesh Chaudhary, Advocates Mr. Pawan Sharma, APP CORAM: HON'BLE MR. JUSTICE VIPIN SANGHI 1. Whether the Reporters of local papers may be allowed to see the judgment? 2. To be referred to Reporter or not? Yes 3. Whether the judgment should be reported Yes in the Digest? VIPIN SANGHI, J. 1. By this order I proceed to dispose of Crl M.C. No.1945/07 which seeks the quashing of F.I.R. No.78/2006 registered at Police Station Anti Corruption Branch, Delhi, under sections 420 r/w 120-B of the Indian Penal Code (IPC) and 13(2) r/w 13(1)(d) of the Prevention of Corruption Act (P.C.Act), and also Crl M.A.No.11358/07 which has been filed to seek the transfer of the investigation to CBI. 2. The petitioner claims to be the proprietor of M/s Medicare Crl. M.C. No.1945/2007 Page 2 of 28 Textiles, a firm stated to be engaged in the business of manufacturing and supplying surgical dressings. The petitioner states that he has been supplying surgical dressings to a number of hospitals, including those falling under the Government of Delhi, for the past 10 years. 3. As per the case of the prosecution, one Sh. Mishri Lal, stated to be the General Secretary of the Lok Nayak Hospital Employees Union, 717, Lok Nayak Hospital, New Delhi, made a complaint to the police on 06.11.2006 stating that the petitioner herein has been supplying sub-standard material i.e. the surgical gauze cloth to the government hospitals, viz Lok Nayak and Deen Dayal Upadhyay Hospitals in conspiracy with the staff of the said hospitals. He alleged large scale corruption in these hospitals. His allegation was that cotton gauze cloth of size 60 cm x 20 mtrs. is being supplied at the rate of Rs.48.90 paise in Maulana Azad Medical College and Hospital from M/s Brij Textiles. Cotton Gauze size 60 cms. x 20 mtrs. is being supplied by Medicare Textiles at the rate of Rs.48.90 paise in other Delhi Administration Hospitals, whereas the same is being purchased at Rs.97.02 in LNJP Hospital from M/s Medicare Textile. It was further alleged in the said complaint that instead of the size 60 cms. x 20 mtrs. and 90 cms. x 20 mtrs., gauze cloth of size 45 cms. x 20 mtrs. is being supplied to the LNJP hospital for the last two years since the posting of Shri Vinod Ramteke as Medical Superintendent of the said hospital. Allegations were also made in the complaint with regard to Crl. M.C. No.1945/2007 Page 3 of 28 supply/repair of some medical equipment by another entity, with which I am not presently concerned. On the basis of this complaint, the Anti Corruption Branch registered the aforesaid FIR bearing No.78/2006 on 07.12.06. 4. The further case of the prosecution is that after registration of the FIR, Physical measurement of the Cotton Gauze thaans in the stores of LNJP Hospital and Shushruta Trauma Centre was conducted in the presence of punch witness and LNJP Hospital Vigilance staff wherein a large number of thaans were found to be 45 cms to 50 cm in width and 20 mtrs in length, whereas, according to the supply order the same should have been 60 cm in width. These supplies are alleged to have been made in respect of supply order No.F.1(7)/10/DHS/CPA/ 2002/1214-21 dated 31.01.2005 placed on M/s Medicare Textiles by CPA/DHS. The under sized cotton Gauze thaans were segregated and kept in the store in the custody of LNJP Hospital Vigilance staff after sealing. It is further alleged that 95 samples and big bags containing approx. 8710 thaans of the under sized gauze cloth were segregated and taken in possession and deposited in the maalkhana of the Police Station, Civil Lines, Delhi. Thereafter, samples were sent to the Shri Ram Institute of Industrial Research for analysis on 27.1.20007 and 09.02.2007 and for comparison with the specifications mentioned in the tender. They were tested and a report was received on 06.03.2007. It is alleged that the samples do not meet the Crl. M.C. No.1945/2007 Page 4 of 28 measurement requirements and also do not conform to the specifications in most cases, thereby concluding that the supply did not meet the specifications. 5. The petitioner filed an anticipatory bail application u/s 438 Cr.P.C.(Code) on 22.03.2007 which was dismissed as withdrawn by the trial court. He again filed another anticipatory bail application on 7.4.2007 which was dismissed as being devoid of merits. Non-bailable warrants were issued against him on 26.03.2007. Thereafter the petitioner moved an application for cancellation of the non bailable warrants, which was dismissed on 13.04.2007 by the trial court. On 19.04.2007, this court granted interim bail to the petitioner till 23.05.2007 which was extended by one week with the direction to move an application for regular bail. 6. Thereafter the petitioner moved an application for regular bail in the trial court on 24.5.2007 which was fixed for 26.5.2007. On that day the an application for police remand of the accused/petitioner was moved. The matter was reserved for orders and was fixed for 29.05.2007. On the said date the learned Spl. Judge refused to take up the matter citing personal difficulties. Consequently the matter was directed to be listed before the learned District & Session Judge on 31.05.2007. In the meantime, the petitioner moved the present petition, and this Court on 31.05.2007 stayed the investigation upto the next date of hearing. The stay of investigation has continued ever Crl. M.C. No.1945/2007 Page 5 of 28 since. 7. As aforesaid, this petition as initially filed sought the relief of quashing the FIR in question bearing No.78/2006 registered at P.S. Anti Corruption Branch, Delhi under Section 13(1)(d), 13(2) of the Prevention of Corruption Act read with Section 420/120B IPC. However, during the pendency of this petition, it appears, that the petitioner has sought to modify the relief that he seeks. On 11.9.2007 after the arguments had been partly heard by the Court, the petitioner made a statement that he has no hesitation if the CBI investigates the case No.RC-DAI-2007-A-0009 dated 6.2.2007, the case filed against the complainant Shri Mishri Lal the General Secretary of the Lok Nayak Hospital Employees Union in respect of the FIR No.78/2006. He sought time to move the application for the said purpose. 8. The petitioner thereafter moved Crl.M.A. No.11358/2007 seeking a direction to transfer the investigation of case FIR No.78/2006, i.e., the FIR in question, to the CBI which is already conducting investigation in case RC-DAI-2007-0009. This application was filed by the petitioner on the premise that investigations into the subject matter of RC-DAI-2007-0009 and the FIR in question bearing No.78/2006 are inter linked and shall have definite bearing on each other. It was further stated that the CBI while investigating the said RC-DAI-2007-0009 is also investigating the subject matter of FIR No.78/2006. The petitioner stated that since the matters were inter Crl. M.C. No.1945/2007 Page 6 of 28 related “the petitioner did not have any objection with the CBI investigating the aforementioned FIR No.78/2006.” It was further stated that no prejudice shall be caused to the respondent if the investigation in FIR No.78/2006 is transferred to the CBI. The petitioner alleged that the investigations in the present case had not been carried out fairly and bona fide by the Anti Corruption Branch. It was further stated that the Chief Secretary, Delhi and the Principal Secretary, Health and Family Welfare had also echoed the sentiments of the petitioner by alleging undue influence by the inspectors of Anti Corruption Branch in the day to day functioning of the Hospital. The petitioner further alleged that the dispute was of a civil nature and criminal proceedings had been instituted with a view to wreck vengeance on the petitioner. 9. The petitioner also termed the investigation conducted by the respondent as mala fide for the reason that the Anti Corruption Branch had raided the Hospital, giving a complete go by to the provisions of the Drugs and Cosmetics Act while seizing and testing the samples. It was submitted that cotton gauze is a „drug‟ defined under the Drugs and Cosmetics Act. However none of the procedures prescribed under the said Act for seizing and testing of the samples were adhered to by the investigating agency. Even the test reports were sought from laboratory neither defined under the Drugs and Cosmetics Act nor approved by the Hospital authorities and the Crl. M.C. No.1945/2007 Page 7 of 28 petitioner had not been given a chance even to challenge the said report. The samples allegedly seized by the Police were not kept in such climatic conditions as were required for the specific drug i.e. absorbent cotton gauze which, therefore, adversely affected the quality of the drug on testing. The petitioner contended that neither the offence could be made out under the I.P.C or the P.C. Act, nor the investigation be conducted under the Cr.P.C., since the Drugs and Cosmetics Act was a special law and the aforesaid were general laws. According to him, the special law would prevail over the general law. In support of this submission, the petitioner relied upon Suresh Nanda v. C.B.I. 2008 IV AD (SC) 351 wherein the passport of the petitioner was impounded without conforming to the provisions of the passport Act, 1967, and it was held that the provisions of Passport Act should have been adhered to for the purpose of impounding of a passport. In paragraph 10 of the application the petitioner stated: “10. That in view of the aforesaid, i.e. when the CBI is already investigating the case against the complainant of the present case, which has a definite bearing on the present case, coupled with the fact that the investigation has been conducted by the Anti Corruption Branch in the present case in an oblique manner, it shall be in the interest of justice, that the investigation of case FIR No.78/06 shall be transferred to the CBI.” 10. At the time of arguments, learned senior counsel Mr. D.C. Mathur appearing for the petitioner did not make any submissions in Crl. M.C. No.1945/2007 Page 8 of 28 support of the prayer made in the petition viz. to seek quashing of the FIR No.78/2006. 11. Mr. Pawan Sharma, the learned APP has opposed the petition and the aforesaid Misc. Application to seek transfer of investigation to the CBI. He submits that the investigation by the police cannot be challenged at this stage, as prima facie, there exists sufficient material on record to show that the petitioner may be involved in criminal acts, as alleged in the F.I.R. Further, while countering the arguments of the petitioner Mr. Sharma submits that the respondents have got the samples verified from a well renowned institute i.e., Shri Ram Institute of Industrial Research, which is known for its standards and accepted as a reliable institute. Thus, the petitioner cannot question the veracity of the results obtained from the said institute. He submits that Shri Ram Institute for Industrial Research is licensed by the Drug Controller for Drugs and Cosmetic. 12. Mr. Sharma further submits that the investigation is still at initial stages and the provisions of the Drugs and Cosmetics Act 1940 will be added at an appropriate stage. It is primarily because of the abuse of power by the hospital officials in connivance with the petitioner that the provisions of IPC and prevention of Corruption Act have been invoked. Further, he submits that the material seized, i.e the “surgical gauze cloth” was found short in measurements and thus the climatic conditions would not adversely affect the case of the Crl. M.C. No.1945/2007 Page 9 of 28 petitioner. Hence the argument that the materials seized were not kept in prescribed conditions is of no consequence. 13. Though the petitioner has not pressed for the relief of quashing of the FIR in question, even otherwise in my view the petitioner has failed to make out a case to justify the quashing of the FIR at this stage. The allegations qua the petitioner found in the uncertified translated copy of the FIR filed by the petitioner read as follows: “Sir we want to bring you face to face with the truth of those hospitals linked with the health department whereby, lacks of rupees are being swindled daily under the head of purchase and repair of articles of daily use of the patients and the technical life saving machinery and parts thereof. In this are involved the junior officers of the hospital their sidekicks and the Medical Superintendent. Sir, if we start with the misdeeds then the first place goes to that regarding articles of daily use such as cotton gauze/gauze cloth which is used in even the smallest of places and the news regarding this is nothing less than explosive. If we compare the purchase by Lok Nayak Hospital and that by other hospitals, mind boggling figures come to the fore. 1. M.A. Dental College Hospital Size 60 cm x 20 M price 48/90 Paise. 2. Delhi Govt.- various hospital Size 60 cm x 20m. Price 49/90 Paise. 3. Lok Nayak Hospital Size 90cm x 20 meter Price 97/02 Paise Medicare Textile. At least No.3, gauze cloth purchased by LNH and supplied by Medicare Textile only reaches the hospital in size 45 cm x 20m. The Crl. M.C. No.1945/2007 Page 10 of 28 interesting part is that this has been going on for the last two years i.e from the time that respected Shri Ramtake ji has been Medical Superintendent. Whenever there is any kind of purchase of anything a person does so after finding out about it completely to his satisfaction. However, can it be that the Medical Superintendent did not use even 0% of his intelligence regarding this and can his intentions not be gauged from this? The regular standards have been completely flouted in relation to the stuff supplied by Medicare Textiles. The supplied goods according to law should have complete details with them viz., name of company, name of material, manufacturing batch, lot no, manufacturing date, expiry date, guarantee period etc. but why are these directions not followed with regard to the Stuff supplied to Lok Nayak Hospital? There is a vast difference in the orders placed with Medicare Textile and the orders supplied. You can see this on inspecting any ward, O.T., Store on Trauma center department as early as possible. We would like to state that Madaan, the owner of Medicare Textile, Claims he has relations with the CBI. This can be found out through investigation. However, it is true that through Madaan, an influential power is helping the Superintendent of Lok Nayak Hospital.” 14. The substance of the allegations against the petitioner is that he has, in conspiracy with some of the officers of the LNJP Hospital supplied cotton gauze of specifications different from those specified under the contract, and at much higher rates than the rates at which the said items were supplied, inter alia, to other Delhi Administration hospitals. On the basis of the said allegations the FIR was registered under Sections 13(1)(d) of the Prevention of Corruption Act read with Section 420/120B IPC against the petitioner and a few others. On a Crl. M.C. No.1945/2007 Page 11 of 28 reading of the FIR it is seen that the petitioner has failed to make out a case falling within any of the illustrations given by the Supreme Court in State of Haryana vs. Bhajan Lal 1992 Supp.(1) SC 335, or even otherwise to justify the quashing of the FIR in question at this early stage of investigation. It cannot be said that the allegations made in the FIR/complaint, even if they are taken at their face value and accepted in their entirety, do not prima facie constitute any offence or make out a case against the accused. It cannot be said that the allegations in the FIR do not disclose a cognizable offence justifying the investigation by police officers under Section 156(1) of the Code. It is not even the petitioner's case that there exist uncontroverted allegations in the FIR and the evidence collected in support of the same, which do not disclose the commission of any offence and make out a case against the accused, including the petitioner. The allegations in the FIR clearly constitute cognizable offence and, therefore investigation could be carried out by the respondents without an order of the Magistrate in terms of Section 155(2) of the Code. Neither is the case of the petitioner that the allegations in the FIR are absurd or inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceedings against the accused. The petitioner has also not pleaded any express bar engrafted in any provisions of the Code or any other law, including the Drugs and Cosmetics Act, to the institutions and continuance of the proceedings. Crl. M.C. No.1945/2007 Page 12 of 28 15. Consequently the relief sought by the petitioner in the petition to seek quashing of the FIR in question, in any event, could not have been granted to the petitioner. 16. Turning now to the relief sought by the petitioner in Crl.M.A.No.11358/07, that the investigation of the aforesaid FIR be transferred to the Central Bureau of Investigation (CBI), which is also investigating RCDAI-2001-0009 against the complainant Shri Mishri Lal in respect of the FIR in question, once again I find no merit in the submissions of the petitioner. The said prayer made by the petitioner is founded upon, firstly, the argument that investigations in the FIR in question and in RCDAI-2001-0009 are interlinked and have definite bearing on each other. I cannot appreciate this submission of the petitioner. What is being investigated under the FIR in question by the Anti Corruption Branch, inter alia, is the allegation of corruption and conspiracy by and between various governmental officials and the petitioner for the alleged supply of cotton gauze, which was not as per the specifications laid down in the contract and at rates which were higher than the rates at which the same item was being supplied to other government hospitals. On the other hand, the case being investigated against the complainant of the FIR in question, namely, Sh. Mishri Lal being investigated by the CBI in RCDAI-2001-0009 pertains to the allegation of corruption against Sh. Mishri Lal. The acts/omissions of the petitioner and the other accused in the FIR Crl. M.C. No.1945/2007 Page 13 of 28 No.78/2006 is in no way being investigated in the said RCDAI-2001- 0009. These two are different set of acts/omissions committed at different point of time by different persons. In the first case under investigation i.e. FIR No.78/2006 it is conduct of the petitioner and the other government officials who are named as accused which is being investigated, while in RCDAI-2001-0009 it is the conduct of Sh. Mishri Lal (the complainant in respect of FIR No.78/2006) which is being investigated. I, therefore, cannot agree with the submission of learned senior counsel for the petitioner that the two investigations are inter- related. 17. The second submission in support of the aforesaid prayer for transfer of investigation to the CBI is equally meritless. The submission is that cotton gauze is a “drug” within the meaning of Drugs and Cosmetics Act, and that since the said Act is a special statute, whereas the IPC, Cr.P.C and P.C Act are general statutes, it is the Drugs and Cosmetics Act under which the prosecution should have been launched and not under IPC. The FIR in question has been registered under the Prevention of Corruption Act and the Indian Penal Code on the basis of the complaint made by the complainant Sh. Mishri Lal. The said complaint does not make any reference to the provisions of the Drugs and Cosmetics Act. In fact, the allegation contained therein is not with regard to any breach or violation of any provision of the said Act. The allegation is with regard to the supply of cotton Crl. M.C. No.1945/2007 Page 14 of 28 gauze of specification, namely, physical dimensions different from that stipulated in the contract and at rates higher than those at which supplied and were effected to other government hospitals. Even if it were to be assumed that the cotton gauze is a “drug” within the meaning of Drugs and Cosmetics Act, and that the supply of cotton gauze of the dimensions as supplied by the petitioner is in breach of any provisions of the said Act, and constitutes an offence under the provisions of the said Act, it does not mean that if the ingredients of Section 13(1)(d) of the Preventions of Corruption Act read with Section 120B of the IPC and Section 420 of IPC read with Section 120B IPC is made out, the accused could not be prosecuted for the said offences. No provision has been brought to my notice by learned senior counsel for the petitioner to say that in respect of an offence under the Drugs and Cosmetics Act, no prosecution would be launched against the accused under any other law even though the same alleged conduct may tantamount to an offence under any other law. I may also note that in reply to the petitioner‟s application being Crl. M.A. No.11358/2007, the stand taken by the respondents is that though the case has been registered under the Prevention of Corruption Act read with IPC, the provisions of Drugs and Cosmetics Act will be added at the appropriate time after completion of investigations. At this juncture it would be advantageous to notice Sections 2 and 32 (Section 32 falls in Chapter IV) of the Drugs and Cosmetic Act, 1940: “2. Application of other laws not barred.- Crl. M.C. No.1945/2007 Page 15 of 28 The provisions of this Act shall be in addition to, and not in derogation of, the Dangerous Drugs Act, 1930 (2 of 1930), and any other law for the time being in force.”(emphasis supplied) “32. Section 32 - Cognizance of offences (1) No prosecution under this Chapter shall be instituted except by an Inspector or by the person aggrieved or by a recognised consumer association whether such person is a member of that association or not]. (2) No Court inferior to that of [a Metropolitan Magistrate or of a Judicial Magistrate of the first class] shall try an offence punishable under this Chapter. (3) Nothing contained in this Chapter shall be deemed to prevent any person from being prosecuted under any other law for any act or omission which constitutes an offence against this Chapter.” (emphasis supplied). 18. Thus, the aforesaid provisions make it amply clear that the provisions of Drugs and Cosmetics Act do not override any other Act, which would include the Cr.P.C. or the P.C. Act or I.P.C. The prosecution of the petitioner, as at present is not under the Drugs and Cosmetics Act. Chapter IV of the Drugs and Cosmetics Act deals with “Manufacture, Sale and Distribution of Drugs and Cosmetics”. Therefore, even if the petitioner is to be prosecuted under the said Act, it is Chapter IV thereof which would be relevant for the purpose of his prosecution. 19. In State of West Bengal v. Narayan K. Patodia, 2000 Crl. M.C. No.1945/2007 Page 16 of 28 III AD (SC) 69, relied upon by Mr. Sharma, the Supreme Court, while relying upon its earlier decision in A.R Antulay V. Ramdas Sriniwas Nayak and Another, 1984(2) SCC 500, held that the Code is the parent statute which provides for investigation, inquiry into, and trial of cases and unless there is specific provision in other statute to indicate a different procedure to be followed, the provisions of the Code cannot be displaced. The Supreme Court observed: “That apart, how could the FIR