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Karnataka High Court
A.Narasimhaiah - Appellant
Versus
State of Karnataka - Respondent
Decided On : 08-09-01
W.A. : 4220 of 2000
Delhi Special Police Establishment Act - The court analyzed the provisions of Section 5 of the Act, which allows the Central Government to extend the powers and jurisdiction of the Delhi Special Police Establishment (SPE) to investigate specified offences in any area. The court held that the order under Section 5 did not become extinct when a fresh notification under Section 3 was issued. Prevention of Corruption Act - The court analyzed the definition of 'public servant' under Section 2(c) of the Act. The court held that the respondent, as a member of the bank's managing committee, fell under the definition of a 'public servant' under sub-clause (ix) of Section 2(c). The court also held that the consent given by the state government for investigation by the CBI was valid.
Fact of the Case:
The petitioners, who are directors of a co-operative bank, filed a writ petition to restrain the respondents from taking adverse action against them based on allegations of financial improprieties. The court dismissed the writ petition, stating that the authorities had the right to make complaints and request a probe. The court held that it would not interfere with the authorities' powers unless the allegations were proven false. In another writ petition, the court quashed a notification giving consent to the CBI to investigate irregularities in the bank, stating that the state government should have waited for the outcome of the first writ petition. The court gave the state government the liberty to issue a fresh notification after the first writ petition was disposed of. The court then analyzed the legal provisions of the Delhi Special Police Establishment Act and the Prevention of Corruption Act to determine the validity of the notification. The court held that the order under Section 5 of the Act did not become extinct when a fresh notification under Section 3 was issued. The court also held that the respondent, as a member of the bank's managing committee, fell under the definition of a 'public servant' under the Prevention of Corruption Act. The court rejected the argument that there was no material before the state government to give consent for investigation, stating that a probe was necessary to uncover any fraud involving the bank's funds. The court allowed the writ appeal and upheld the consent given by the state government for investigation by the CBI.
Finding of the Court:
The court analyzed the legal provisions of the Delhi Special Police Establishment Act and the Prevention of Corruption Act to determine the validity of the notification giving consent to the CBI to investigate irregularities in the bank. The court held that the order under Section 5 of the Act did not become extinct when a fresh notification under Section 3 was issued. The court also held that the respondent, as a member of the bank's managing committee, fell under the definition of a 'public servant' under the Prevention of Corruption Act. The court rejected the argument that there was no material before the state government to give consent for investigation, stating that a probe was necessary to uncover any fraud involving the bank's funds.
Ratio Decidendi: The court held that the order under Section 5 of the Delhi Special Police Establishment Act did not become extinct when a fresh notification under Section 3 was issued. The court also held that the respondent, as a member of the bank's managing committee, fell under the definition of a 'public servant' under the Prevention of Corruption Act. The court rejected the argument that there was no material before the state government to give consent for investigation, stating that a probe was necessary to uncover any fraud involving the bank's funds.
Result: The court allowed the writ appeal and upheld the consent given by the state government for investigation by the CBI.
( 1 ) WRIT Appeal 4220/2000 is filed by the petitioners in Writ Petition No. 32774/1996 and Writ Appeal No. 7653/1999 is filed by the State Government and other officials, who were respondents in Writ Petition No. 19578/1997. In both the Writ Petitions, the Petitioners are Directors of Bangalore District and Rural District Central Co-operative Bank Limited (hereinafter referred to as 'bank' ).
( 2 ) IN Writ Petition No. 32774/1996 the prayer is to restrain the respondents from taking any adverse action against the petitioners pursuant to the communications dated 8-11-1996 and 11-11-1996 (Annexures - 'c' and 'd' ). Annexure - 'c' is a letter addressed by the then Union Minister of Textiles addressed to the then Chief Minister pointing out serious financial improprieties committed in sanctioning the loans by the Bank under the Chairmanship of the 1st petitioner and requesting the Chief Minister to direct a probe into the entire matter and also to provide him with certain information. Annexure - 'd' is a communication addressed by the Registrar of Co-operative Society (2nd respondent) to the Managing Director of the DCC Bank. In that letter the Registrar observed that the inspection of the Bank revealed that the loans were given to Housing and Credit Societies without adequate and proper security and that the Management had shown total lack of prudence and acted negligently while handling precious money of the depositors. The Registrar then observed that the Committee of Management was guilty of 'criminal breach of trust and negligence'. The Managing Director was directed to examine each case of loan sanctioned wherever it was overdue and to take necessary action to prosecute the erring member of the Committee. The learned single Judge dismissed the writ petition holding that the persons who addressed the letters were within their rights to make the complaints and to request/direct a probe into the matter. It was observed:"if, after enquiry the allegations are found to be untrue or false, it is for the authority to take such action as is necessary and permitted in law". The learned Judge further observed that this Court, in exercise of its extraordinary jurisdiction under Article 226 of Constitution of India, would not be right in interfering with the powers vested in the authorities and to forbear them from taking any action on such letters.
( 3 ) WE do not find any error of law in the impugned judgment. The relief sought for is somewhat extraordinary. The communications - Annexure - 'c' and 'd' are meant to bring to the notice of the appropriate authorities certain aspects relating to the functioning of the Co-operative Societies so as to facilitate a further probe/enquiry into the matter. One such letter is written by a public representative in the position of a Minister and another is an inter-departmental communication. The writ petitioners have no cause of action to complain against such letters being addressed by responsible persons in office. The approach adopted by the learned single Judge cannot be legally faulted. Hence, Writ Appeal is dismissed with costs of Rs. 2000/ -.
( 4 ) WE now turn our attention to the more contested writ appeal i. e. , Writ Appeal No. 7653/1999 filed against the order in Writ Petition No. 19578/1997. That writ petition was filed by the 1st petitioner in the other writ petition by name Sri Narayana Gowda. The relief sought for in the writ petition is to quash the notification dated 10-6-1997 (Annexure-'g') issued by the State Government (Home Department) giving consent to the Delhi Special Police Establishment (CBI) to register a case, investigate it and launch prosecution against those involved in the irregularities that occurred in the DCC Bank. The Notification reads as follows :"in pursuance of the provision contained in Section 6 of the Delhi Special Police Establishment Act, 1946 (Act XXV of 1946), the Government of Karnataka is pleased to accord consent to the extensio
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