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2010 Supreme(Mad) 3126
High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE T. SUDANTHIRAM
P.S. Murthy & Others
Versus
The State represented by Inspector of Police Special Police Establishment Central Bureau of Investigation Anti-Corruption Branch, Chennai
CRL.R.C.No.88 to 90, 107, 173 to 175, 260, 420, 489, 581 and 801 of 2004, Crl.R.C.Nos.691 and 711 of 2010
Decided On : 30-07-2010
For the Petitioners:AR.L. Sundaresan, Senior counsel for M/s. A.L. Gandhimathi, A.V. Somasundaram for M/s. Lakshmipriya Associates in T. Sivananthan, Advocates, T. Murugesan, Senior Counsel for M/s. Kurien Associates, Advocates, V. Balasubramanian, A. Raghunathan, Senior Counsel, M. Kempraj & S. Subbulakshmi, Advocates.
For the Respondents: N. Chandrasekaran, Special Public Prosecutor for CBI Cases.
The judgment established that irregularities and defaults committed by the accused, without sufficient evidence of criminal intention, were inadequate to frame any charge against them.
Headnote:
Corruption - Awarding of Short Term Contract - IPC 120-B, IPC 420, Prevention of Corruption Act 13(2) r/w 13(1)(d) - 120-B, 420, 13(2) r/w 13(1)(d)
Fact of the Case:
The case involved the awarding of a short term contract for sea transportation of crude oil by ONGC to a company without following tender procedures. The vessel carrying crude oil ran aground, leading to wrongful loss incurred by ONGC.
Finding of the Court:
The court found that there was no prima facie material to show criminal intention or malpractice in awarding the contract. It concluded that the loss incurred was not due to the criminal act of the accused and that the accused did not act with mala fide intention.
Issues: The main issue was whether the accused acted with criminal intention in awarding the contract and causing wrongful loss to ONGC.
Ratio Decidendi: The court held that the irregularities and defaults committed by the accused were inadequate to frame any charge against them, and therefore quashed the proceedings against all the accused.
Final Decision: All the Criminal Revision Cases were allowed, and the proceedings against all the accused were quashed.
1. The final report was filed by the Inspector of Police-CBI, Chennai, totally against 15 accused for offences under Sections 120-B r/w 420 IPC and 13(2) r/w 13(1)(d) of the Prevention of the Corruption Act.
2. The Accused 1 to 14 filed petitions before the trial Court seeking discharge, but the petitions were dismissed. Aggrieved by the said order, the petitioners have preferred the above criminal revision petitions before this Court.
3. It is brought to the notice of this Court now that P.C.Shaw(A.1) and BMN.Rao (A.10) have died.
4. The case of the prosecution in brief is that crude oil produced by ONGC at Ravva 10 and 17 Offshore platforms were required to be transported from Surasanyanam to H.P.C.L refnery at Vizag. Since the oil coordination committee recommended for the transport of crude oil by sea route to avoid pollution and road congestion, ONGC invited open tenders to transport the crude oil by sea route. For this tender, a mimimum experience of two years of sea transportation of petroleum products was fixed. The fifteenth accused Victoria Marine Base Limited company was one among the companies responded the said tenders. But, it was not having required minimum experience of two years. Accused 11 to 14 represented M/s. Victoria Marine Base Ltd.,. Pending the said tender process, the first accused-General Manager of ONGC, second accused-General Manager (Finance and Administration) ONGC, third accused General Manager (Maintenance) ONGC, 10th accused -Group General Manager, ONGC recommended and awarded a short term contract for sea transportation of crude oil to 15th accused VMBL company without following any tender procedure or consolidating other prospective bidder in the open tender. The fourth accused, V.K.Ahuja, Regional Director – ONGC approved the recommendation of the tender committee to award the contract. A.1 to A.4 and A.10 also allowed 0.68% transportation loss to the VMBL company against the standard transportation loss of 0.3%. The detailed work order dated 05.02.1994, issued by the company was faxed to the 15th accused but it was replaced by letter of indent antidated 05.02.1994. The 15th accused company did not commence the transportation work within 20 days from 05.02.1994 as condition stipulated in the letter of indent and the delay was condoned and the time was extended.
5. Due to inexperience of the accused company in operating Barge in uncharted river and due to overloading of Barge, the vessel which was going on the river carrying crude oil ran aground. The ministry of petroleum and natural gas directed ONGC to transship and evacuate the crude oil to avoid pollution with the assistance of Coast Guard at the expense of ONGC contractors. The salvage work was handed over to M/s.Essar shipping company. Post dated cheques for Rs.12 lakhs instead of bank guarantee was obtained from VMBL company towards its responsibility for payment towards Salvage operation. A stop payment of post dated cheque of Rs.12 lakhs was given and ONGC had to pay Rs.3,29,00,000/- to the Coast Guard to evacuate crude oil from the grounded barge of VMBL. ONGC had to pay Rs.11 lakhs to ESSAR for salvage of grounded Barge. By the act of the accused, ONGC incurred wrongful loss.
6. All the learned Senior counsel and other counsel appearing for the petitioners made their submissions and Mr.N.Chandrasekaran, learned Special Public Prosecutor for CBI Cases was also heard.
7. The arguments on behalf of the petitioners/accused are summarised hereunder:
Even taking the prosecution case as it is and accepting the documents submitted along with the final report, absolutely there is no material to show that the accused with a criminal intention acted in any manner to cheat anyone or conspired together for any pecuniary advantage of the 15th accused. No pecuniary loss was caused to the ONGC by any criminal intention of the accused. There was no malpractice in awarding the contract to the company for transporting the crude oil
