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SUPREME COURT OF INDIA
UDAY UMESH LALIT, INDU MALHOTRA, KRISHNA MURARI, JJ.
Station House Officer, CBI/ACB/Bangalore – Appellant
Versus
B.A. Srinivasan and Anr. – Respondents
Criminal Appeal No.1837 of 2019 (Arising out of Special Leave Petition (Crl.) No.6106 of 2019)
Decided on : 05-12-2019
Prevention of Corruption Act, 1988 – Sections 13(1)(d) and 13(2) read with Section 19 – Criminal Procedure Code, 1973 – Sections 197, 227 and 228 – Indian Penal Code, 1860 – Sections 419, 420, 467, 468, 471 read with Section 120B – Discharge of accused – Protection under Section 197 of Code is available to public servants when an offence is said to have been committed while acting or purporting to act in discharge of their official duty, but where acts are performed using office as a mere cloak for unlawful gains, such acts are not protected – There was no occasion or reason to entertain any application seeking discharge in respect of offences punishable under the Act, on the ground of absence of any sanction under Section 19 of the Act – High Court was also not justified in observing that protection available to a public servant while in service, should also be available after his retirement – That statement is completely inconsistent with law laid down by this Court in connection with requirement of sanction under Section 19 of Act – Issue whether alleged act is intricately connected with discharge of official functions and whether matter would come within expression ‘while acting or purporting to act in discharge of their official duty’, would get crystallized only after evidence is led and issue of sanction can be agitated at a later stage as well – View taken by High Court set aside and order passed by Trial Court restored and application seeking discharge preferred by Respondent No.1 dismissed. (Paras 10, 11, 12 and 15)
Facts of the case:
Present Appeal challenges the judgment and order dated 08.08.2018 passed by the High Court1 allowing Criminal Revision Petition No.834 of 2015 preferred by the Respondent No. 1; and thereby discharging Respondent No.1 of offences punishable under Sections 419, 420, 467, 468, 471 read with Section 120B of the Indian Penal Code, 1860 and Sections 13(1)(d) and 13(2) of the Prevention of Corruption Act, 1988.
Findings of Court:
High Court clearly erred in allowing Criminal Revision Petition and accepting challenge raised by the Respondent No.1 on the issue of sanction. We, thus, allow this Appeal, set aside view taken by the High Court, restore the order passed by the Trial Court and dismiss the application seeking discharge preferred by the Respondent No.1.
Result : Appeal allowed.
The legal document discusses the scope of protection under certain legal provisions for public servants, especially concerning acts performed during or related to their official duties. The key points are as follows:
Protection under Section 197 of the Cr.P.C. is available to public servants when an offence is committed while acting or purporting to act in the discharge of their official duty. However, this protection is limited to the period during which they are in service; it does not extend after retirement (!) .
The protection available to a public servant while in service should also be applicable after retirement, but only if the acts in question are directly connected to their official duties. If the acts are performed using the office as a mere cloak for unlawful gains, such acts are not protected under Section 197 (!) (!) .
The determination of whether an act was performed in the discharge of official duties or was merely using the office as a cover can only be crystallized after evidence is led during trial. The issue of sanction for prosecution, therefore, can be raised at any stage of the proceedings, including after evidence has been examined (!) (!) (!) .
The requirement of prior sanction for prosecution, especially under provisions related to corruption, is imperative when the offences are committed in the course of official duty. Once a public servant has retired, the necessity of such sanction diminishes or becomes irrelevant, particularly if the acts are not directly connected to official duties (!) (!) (!) (!) (!) .
Acts performed using the office as a cloak for unlawful or personal gains are not protected, and the protection under the law is only applicable when acts are directly connected to official functions. The protection is also not available if the acts are committed for personal benefit under the guise of official duties (!) (!) .
The issue of whether an offence was committed in the discharge of official duties can be determined only after examining evidence, and the question of sanction can be revisited at any stage of the proceedings. The law emphasizes that the connection between the act and official duties must be reasonable and established during trial (!) .
When a public servant has ceased to be in service at the time of cognizance or trial, the requirement for prior sanction is generally not applicable, and the law supports the view that protection is limited to the period of active service (!) (!) .
In summary, the protection for public servants under specific legal provisions is strictly linked to acts performed during their official duties and while in service. Acts performed after retirement or using office as a cover for unlawful gains do not enjoy such protection, and the issue of sanction can be considered at different stages, depending on the nature of the act and its connection to official duties.
JUDGMENT
Uday Umesh Lalit, J.
1. Leave granted.
2. This Appeal challenges the judgment and order dated 08.08.2018 passed by the High Court [The High Court of Karnataka at Bangalore] allowing Criminal Revision Petition No.834 of 2015 preferred by the Respondent No.1; and thereby discharging the Respondent No.1 of the offences punishable under Sections 419, 420, 467, 468, 471 read with Section 120B of the Indian Penal Code, 1860 (‘IPC’, for short) and Sections 13(1)(d) and 13(2) of the Prevention of Corruption Act, 1988 (‘the Act’, for short).
3. The Respondent No. 1 retired on 31.10.2012 as Assistant General Manager, Vijaya Bank. On 28.10.2013, FIR being RC 12(A)/2013 was registered pursuant to complaint given by the General Manager, Vijaya Bank, Head Office, Bangalore against the Respondent No.1 in respect of the offences mentioned hereinabove. After completion of investigation, charge-sheet was filed on 31.10.2014 against the Respondent No.1 and other accused in respect of said offences. It was alleged inter alia :-
“3. That Shri B.A. Srinivasan (A-1) while working as Assistant General Manager (AGM) and Branch Head, Vijaya Bank, Mayo Hall Branch, Bangalore during the period from 11.01.2010 to 20.10.2012 entered into a criminal conspiracy with Shri B.Lakshman (A-3), Smt. Shanta Gowda (A-4) and Shri S.V. Isloor (A-5) to cheat and defraud Vijaya Bank, Mayohall Branch, Bangalore and to extend undue financial accommodation to M/s. Nikhara Electronics and Allied Technics (A-2) on the basis of fake and fabricated documents and in furtherance of the said criminal conspiracy, Shri B.A. Srinivasan (A-1) sanctioned and disbursed Rs.200 lakhs of Term Loan and Rs.100 lakhs of Cash Credit Hypothecation (Working Capital) in favour of M/s. Nikhara Electronics and Allied Technics (A-2) without proper due diligence and in gross violation of all extant rules and regulations of Vijaya Bank, and hence, facilitated A-3 and A-4 to divert the loan-funds against the terms and conditions, thereby causing wrongful loss to Vijaya Bank and corresponding gains to others.
…… …
8. That Shri B. Lakshnian (A-3) and his wife Smt. Shanta Gowda (A-4) fraudulently created an agreement dated 10.06.2011 on the photocopy of e-stamp paper having franking No.57724 dated 08.06.2011 and submitted a copy of the same to Vijaya Bank to support their dishonest claim of taking over M/s. Nikhara Electronics & Allied Technics, proprietary concern by making a payment of Rs.1.00 Crore as goodwill to Shri Venkataramana Bhat (A-6). Shri B.A. Srinivasan (A-1) dishonestly accepted the photocopy of the agreement intentionally omitting to ascertain its genuineness or authenticity. It is revealed that the above agreement was fraudulently created on the photocopy of e-stamp paper franked vide 57724 dated 08.06.2011 and the original stamp paper remained blank was seized from the office premises of Shri S.V. Isloor (A-5). It is thus established the fraudulent intentions of all the accused persons to create forged documents as and when required and to misrepresent that the proprietary unit was taken over by A-3 and A-4 from A-6.
…… …
16. That Shri B.A. Srinivasan (A-1) in furtherance of criminal conspiracy with the other accused dishonestly, by abusing his official position as AGM & Branch Head of Vijaya Bank, Mayohall Branch fraudulently considered the loan application, processed loan proposals in gross violation of the rules and regulations of Vijaya Bank in this regard in order to favour the accused persons. He intentionally accepted the inflated financial statements submitted by A-3 and A-4 even though they were not audited and considered them for working out the credit assessment of the borrower firm i.e., M/s. Nikhara Electronics and Allied Technics (A-2). He purposely did not exercise due diligence to analyse the financial statements submitted by the borrower firm which contained several inconsistencies. He also did not conduct the mandatory pre-sanction verification at the address of the
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