IMPORTANT POINT
At stage of application for discharge of accused the exercise should be confined to considering the police report and the documents to decide whether the allegations against the accused are "groundless" or whether "there is ground for presuming that the accused has committed the offences." Presumption therein is always rebuttable by the accused for which there must be opportunity of participation in the trial.

Headnote:Code of Criminal Procedure, 1973-Section 239-Indian Evidence Act, 1872-Section 10-Discharge of accused-Legality of-Offence under Section 409 r/w 120-B of IPC and Section 13(2) of Prevention of Corruption Act-Respondent Ex-Chief Minister arraigned as prime accused along with other accused persons who were Minister and Government Officers-Trial Court discharging respondent on ground material were insufficient to frame charge against her but framing charges against other accused persons-Reasoning of trial Court any High Court that while signing concerned file objection note of Secretary was not there and Chief Minister, respondent, would not have known conspiracy-Held, on basis of material available on record there is strong presumption, under respondent affords satisfactory explanation, that respondent was aware of serious consequence of dial on State exchequer as pointed out by Secretary-Court can presume there are reasonable ground to believe she was involved in conspiracy envisaged in Section 10 of Evidence Act-Exercise at stage of discharge must be confined to considering police report and documents to decide allegations against accused-Discharge order of trial Court as confirmed by High Court set aside.
       Held : The question of using anything said, done or written by anyone of such conspirators would arise only if the facts would help to sustain the first limb of the section i.e. there is reasonable ground to believe that two or more persons have conspired together to commit an offence. Unless the court has some materials to believe that respondent is one of those persons referred to in the first limb of the section, so far as the conspiracy in this case is concerned, any consideration for what she had said, done or written would not be a relevant fact as against each of the conspirators. Nevertheless, it is open to the court, even at this stage to consider the materials relating to what an accused would have said, done or written with reference to the common intention between the accused for the purpose of deciding whether there is reasonable ground to believe that the said accused would have been one of the conspirators. (Para 16)
       The above materials are included in the Current File which was submitted to the respondent. There is no case for the respondent that the above were not in that File when she scrutinised it nor is it anybody s case that those warnings were included only in the missing sheets. If respondent came to know of these prompt warnings and despite them she accorded her green signal to import the coal, how could it be concluded at this premature stage that she was not aware of the serious implications of the clandestine deal on the State exchequer. At this stage we are proceeding on the assumption that there was a criminal conspiracy to commit the offence under Section 409 of IPC and Section 30(2) of the PC Act, because the trial court has chosen to frame charge against the co-accused including one Cabinet Minister who was working under the respondent. It was contended that if the Chief Minister had read the whole Note of Shri V. Sundaram it is for her to put forth satisfactorily that she was convinced in spite of such warnings that the deal was genuine and in the best interest of the State or that she had discussed those points with the said Secretary and she had good reasons to overrule the objections. We find force in the said contention that until the respondent affords satisfactory explanation the court can presume that she was aware of the serious consequences of the deal on the State exchequer as pointed out by the said PWD Secretary. Court can also presume at this stage that there are reasonable grounds to believe that she was involved in the conspiracy as envisaged in Section 10 of the Evidence Act. Nevertheless, it is for the prosecution to explain how certain relevant sheets were found missing and whether respondent had any knowledge of and also why the respondent should have caused them to be removed. This is not the stage for weighing the pros and cons of all the implications of the materials not for sifting the materials presented by the prosecution. The exercise at this stage should be confined to considering the police report and the documents to decide whether the allegations against the accused are "groundless" or whether "there is ground for presuming that the accused has committed the offences." Presumption therein is always rebuttable by the accused for which there must be opportunity of participation in the trial. (Paras 28, 29, 31 & 34)
       Held, consequently, the court would not, and should not, have discharged the respondent at this premature stage in respect of the offences charged against the other nine accused persons. Therefore, we set aside the order passed by the Special Court discharging respondent. Jayalalitha and that of the High Court which confirmed the said order. (Paras 35 and 36)

JUDGMENT

Thomas, J.-Leave granted.

2. The former Chief Minister of Tamil Nadu Ms. J. Jayalalitha was arraigned before the Court of a Special Judge, Chennai, along with 10 others, depicting her as the hub of a cabal for knocking off a huge sum of public money to make vast pecuniary gains at the cost of the State exchequer. The Special Judge at the stage of framing charge felt that the materials shown to him were insufficient to frame a charge against her and also against one of her former cabinet colleagues (V.R. Nedunchezhian). So they were discharged by the Special Judge, but a charge has been framed against the other nine accused for criminal conspiracy to misappropriate Government funds and other related offences. The State of Tamil Nadu challenged the aforesaid order of discharge before the High Court of Madras in revision, but a learned Single Judge did not interfere with the order. In the meanwhile V.R. Nedunchezhian has passed away. This appeal is by the State as against Ms. Jayalalitha (respondent herein) in challenge of the said order of the High Court.

3. The substance of the police case is that during the period between February, 1992 and October 1993, all the above 11 accused and certain foreign coal suppliers had entered into a criminal conspiracy to import coal for Tamil Nadu Electricity Board (hereinafter referred to as the Electricity Board ) for such price as to obtain huge pecuniary advantage to themselves by causing heavy and wrongful loss to the State to the tune of about 6.5 crores of rupees.

4. There are three Thermal Power Stations in Tamil Nadu (at Ennore, Mettur and Tuticorin) which generate electric power by using coal as fuel. The annual requirement of coal for those three stations was about 12 million metric tonnes of coal. As the stock position of coal in March 1992 appeared insufficient to meet the requirement a decision was taken to import at least 2 million metric tonnes of coal from foreign countries. The allegation is that such a decision was taken pursuant to a criminal conspiracy hatched by the accused persons for obtaining huge pecuniary advantage. Pursuant to the decision, tenders were invited from foreign suppliers of coal. On 10.3.1993, tenders were opened, but only 11 of them were found to be in order. However, those bidders were asked to revise the price bid after adding three more parameters, such as size, ash content and volatile matter. The idea was to facilitate import of inferior quality of coal at higher price by showing favouritism to certain coal suppliers of Indonesia, according to the allegation.

5. The Government Secretary (PW D) raised strong objections against the said tenders being accepted. A company based at Singapore (M/s. Counter Corporation) made an offer to supply 6 lacs metric tonnes of coal at the rate of 35.24 US Dollars. But it was rejected without even starting negotiation with them. But the Electricity Board fixed the price of coal at 40.20 US Dollars per metric ton and three Indonesian bidders were permitted to supply coal at that price. Subsequently M/s. Counter Corporation (Singapore) was also asked to supply coal at the increased price of 40.20 US Dollars per metric ton.

6. The offences alleged against all the accused are Section 120-B read with Section 409 of IPC as well as Section 13(2) of the Prevention of Corruption Act, 1988.

7. What persuaded the Special Judge to adopt the view that materials produced before him were insufficient to frame a charge against the respondent, are briefly the following :

The strong objection raised by Government Secretary (Shri V. Sundaram) against the proposal to import coal at such a high price would not have reached the notice of the respondent because it is an admitted position that some crucial sheets in the Current File were removed and such sheets were later added after obtaining approval from the Chief Minister. Special Judge has made the following observations :

"It is not known as to how and where and at what point of t

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2000 Supreme(SC) 1016

Cases Referred (1)