Case: State, Cbi Vs. Sashi Balasubramnian

One M/s Best Fabrics (for short, the Company) had applied for an advance licence on 29.01.1993 from the Office of the Joint Director General of Foreign Trade, Chennai for import of cotton fabrics showing the export order for 47136 sets of cotton mens ensemble under the Duty Exemption Entitlement Certificate (for short, the Scheme). Upon scrutiny the application, a recommendation, however, was made to allow the said company to import cotton fabrics of 44 inch widths. As the item was not figuring in the standard input and output norms book, the file was placed before Respondent No. 1, Smt. Sashi Balasubramanian, by Sri V. Rajpriyan, Respondent No. 2 herein, for placing before the Zonal Advance Licensing Committee for recommendations as regards quantity and description of the goods to be allowed for import.5. Approval for advance licence was granted by Smt. Sashi Balasubramanian. On allegations in regard to the grant of the said licence, a First Information Report was lodged on 02.03.1995 for commission of offences under Sections 120-B, 420 and 471 of the Indian Penal Code, Section 13(2) read with Section 13(1)(d) of the Prevention of Corruption Act, 1988 and Section 136 of the Customs Act, 1962.6. The Company and its Directors, however, in the meanwhile filed an application in terms of the Scheme. Declarations were filed on 31.12.1998. The charge-sheet in the criminal case was filed on 12.04.1999.7. Originally, there were seven accused; three out of them were the private parties, namely, M/s Best Fabrics, Shri S. Vaidyanathan and Shri Bharath Bhushan Goyal. Smt. Sashi Balasubramanian, Respondent No.1 herein, was the Deputy Director General of Foreign Trade and Shri V. Rajpriyan , Respondent No.2 herein, was the Controller of Exports and Imports. Apart from Respondents herein, two other officials were also arrayed as accused persons in the charge- sheet, namely, Shri S. Ramanathan, Assistant Collector and Shri A. Sivaram Kumar, Apprising Officer.8. Accused Nos. 1 to 4 filed an application for quashing the criminal proceedings as against them before the High Court of Madras, which was registered as CC No. 34 of 1999. It is stated that by an order dated 29.04.2004, the said application has been allowed. No appeal is said to have preferred therefrom.9. Respondents thereafter filed an application before the High Court with the self-same prayer, which by reason of the impugned judgment has been allowed.10. Appellant is, thus, before us.

Court's reasoning:
29. In any view of the matter, an immunity is granted only in respect of offences purported to have been committed under direct tax enactment or indirect tax enactment, but by no stretch of imagination, the same would be granted in respect of offences under the Prevention of Corruption Act. A person may commit several offences under different Acts; immunity granted in relation to one Act would not mean that immunity granted would automatically extend to others. By way of example , we may notice that a person may be prosecuted for commission of an offence in relation to property under the Indian Penal Code as also under another Act, say for example, the Prevention of Corruption Act. Whereas charges under the Prevention of Corruption Act may fail, no sanction having been accorded therefor, the charges under the Penal Code would not.30. The High Court has not held that the offences alleged against Respondents are so inextricably connected that it cannot be separated so much so that in the event if it be held that private parties cannot be proceeded with at all, the case against public servants, would invariably fail. We, thus, as at present advised, do not intend to delve deep into the said question. However, to be fair to learned counsel, we may notice the decisions cited at the bar.31. Reliance placed by Mr. Singhvi on Devarapalli Lakshminarayana Reddy and Others v. V. Narayana Reddy and Others [(1976) 3 SCC 252]  has no application to the facts and circumstances of the present case. The question which arose for consideration therein was required to be determined in the context of the provisions of Sections 200 and 202 of the 1898 CodeSections 200 and 202 of the 1973 Code. The question was as to whether cognizance is taken before issuance of process or not.Institution of a prosecution and institution of a complaint case in a criminal court stand on different footings. Whereas summons to an accused in a complaint case can be issued only upon taking cognizance of the offence, the same would not mean in a case where first information report has been lodged resulting in initiation of investigation or where it has been referred to police or other authorities for enquiry; even then a prosecution may not be held to have been initiated at that stage.33. What transpires from the said decision is that whereas before cognizance is taken, application of mind on the part of the court is imperative, taking action of some other kind would not mean that cognizance has been taken. In some cases, even after lodging of the F.I.R., a preliminary enquiry which may not be an investigation into the crime, may be initiated.We may at this stage deal with another contention viz. that if in the connected matter where other public servants were parties, no appeal having been filed from the judgment of the High Court by the C.B.I., this appeal would be maintainable. This aspect of the matter has been considered by aBench of this Court in Government of West Bengal v. Tarun K. Roy and Others [(2004) 1 SCCIn this case also public interest is involved as interpretation of the provisions of the Act were in question. Yet again there cannot be any equality in illegality.50. [See Secretary, State of Karnataka and others vs. Umadevi (3) and others [(2006) 4 SCC 1] 51. We, therefore, are of the opinion that the impugned judgment cannot be sustained. It is set aside accordingly.52. The High Court, however, did not go into the merit of the matter. It proceeded on the basis that the continuation of the prosecution as against Respondents was unsustainable in law. Although prosecution as against Respondents herein may be held to be not maintainable, in our opinion, they are entitled to contend that even if the materials brought on records are given face value and taken to be correct in their entirety, no case has been made out as against them.