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2024 Supreme(Online)(KER) 14560
HIGH COURT OF KERALA
Kauser Edappagath, J
R. CHANDRASEKHARAN – Appellant
Versus
CENTRAL BUREAU OF INVESTIGATION – Respondent
Crl.MC 1634/2022
D.ANIL KUMAR, C.UNNIKRISHNAN (KOLLAM), S.SREEKUMAR (SR.), K.K.RAVINDRANATH, P.MARTIN JOSE, P.PRIJITH, THOMAS P.KURUVILLA, MANJUNATH MENON, AJAY BEN JOSE, HARIKRISHNAN S., R.GITHESH, SREELAL WARRIAR, SC, CBI, A.RAJESH, SPL.PP (VIGILANCE), ANANDA PADMANABHAN, UTHARA A.S, MAHESH CHANDRAN, SARITHA NANDANAN, VIJAYKRISHNAN S. MENON
The amended Section 19 of the PC Act mandates prosecution sanction for retired public servants when cognizance is taken post-amendment, emphasizing the need for proper consideration of evidence in sanction decisions.
Headnote:
[Corruption] - [Prosecution Sanction] - [Prevention of Corruption Act, 1988: Section 19; Indian Penal Code: Sections 120B, 420; Code of Criminal Procedure: Section 197] - The court analyzed the necessity of prosecution sanction under Section 19 of the PC Act, concluding that the amended provision applies prospectively, requiring sanction for retired public servants when cognizance is taken post-amendment. The refusal of sanction was deemed improper due to lack of proper consideration of evidence, impacting the prosecution's ability to proceed against the accused.
Fact of the Case:
The case involves allegations of corruption and mismanagement against former officials of a government-owned cashew company, leading to a CBI investigation and subsequent refusal of prosecution sanction under the Prevention of Corruption Act.
Finding of the Court:
The court found that the sanctioning authority failed to apply its mind to the evidence presented, leading to an improper refusal of sanction, which is essential for prosecution under the PC Act.
Issues: The key issues included whether prosecution sanction was necessary under the amended Section 19 of the PC Act, the legality of the refusal of sanction, and whether the final report disclosed any offences against the accused.
Ratio Decidendi: The court held that the amended Section 19 requires sanction for retired public servants when cognizance is taken after the amendment, and that the refusal of sanction must reflect a proper application of mind to the evidence.
Final Decision: The court set aside the refusal of sanction and directed a fresh examination of the CBI's request.
[WP(C) No.25863/2020, Crl.M.C.Nos.497/2022 & 1634/2022]
- The above criminal miscellaneous cases and the writ petition pertain to the final report dated 30/12/2020 submitted by the CBI, Cochin Branch, Kerala in RC 08(A)/2016/CBI/ACB/Cochin before the Special Judge, CBI Court, Thiruvananthapuram.
2.The Kerala State Cashew Development Corporation (for short, “KSCDC”) is a government owned company engaged in the business of cashew. It was formed in 1969 for the purpose of promoting the business of cashew and for providing employment to cashew workers in Kerala. As per the Articles of Association of the Company, its business and management shall be carried out by the Managing Director subject to the control and direction of the Board of Directors. The Chairman of the Company is entitled to preside over all the meetings of the Board of Directors. One Sri.K.A.Ratheesh was the former Managing Director of the Company from March 2005 to October 2015, one Sri.E.Kasim was the former Chairman of the Company from September 2006 to July 2011, and one Sri.R.Chandrasekharan was the former Chairman of the Company from February 2012 to October 2015. In the course of business, the company imports raw cashew nuts for the purpose of processing and sale. Alleging malpractices, mismanagement, corruption and misutilization of funds in the matter of procurement of raw cashew nuts by the company from India and outside resulting in huge loss to the company and consequentially to the exchequer, the petitioner in WP(C) No.25863/2020 approached this court by filing writ petition (WP(C) No. 16144/2014) praying for an investigation by the CBI. By judgment dated 23/9/2015, this court allowed the same and directed the CBI to conduct the investigation. Pursuant to the said direction issued by this Court, CBI registered an FIR on 27/7/2016 against three persons mentioned above (Sri.K.A.Ratheesh, Sri.E.Kasim & Sri.R.Chandrasekharan) and one Sri. Jaimon Joseph, Proprietor, M/s.JMJ Traders, Kottayam arraying them as accused Nos.1 to 4 respectively for the offences punishable under Sections 120B , 420 of the Indian Penal Code (for short, the IPC ) and Section 13(2) r/w 13(1)(d) of the Prevention of Corruption Act, 1988 (for short, 'the PC Act').
3.The allegation in brief in the FIR was that the accused No.1 Sri.K.A.Ratheesh, former Managing Director of KSCDC, accused No.2, Sri.E.Kasim, former Chairman of KSCDC, and accused No.3, Sri.R.Chandrasekharan, former Chairman of KSCDC, during the period from 2006-2015, entered into criminal conspiracy with accused No.4 Sri. Jaimon Joseph, Proprietor of M/s. JMJ Traders, Kottayam and in furtherance of the said criminal conspiracy, accused Nos.1 to 3 dishonestly awarded tenders to M/s. JMJ Traders, Kottayam, for supplying raw cashew nuts with an intention to cheat KSCDC, in violation of the Rules and procedures adopted by the Government of Kerala, which resulted in wrongful pecuniary loss to KSCDC, estimated to be in several crores, and corresponding wrongful gain to private party and themselves.
4.The CBI, after conducting a detailed investigation, found that the accused Nos.1 to 4 mentioned above committed offences punishable under Section 120B r/w 420 of IPC and Section 13(2) r/w 13(1)(d) of the PC Act. Before filing the final report, accused No.2 died. Prior to the submission of the final report, CBI sought sanction before the sanctioning authority, the Secretary, Industries Department (Cashew), Secretariat, Thiruvananthapuram (2nd respondent in WP(c) 25863/2020) under Section 19 of the PC Act for prosecuting the accused Nos.1 and 3. As already stated, accused No.1 was the Managing Director in service of the company from March 2005 to October 2015 and accused No.3 was the Chairman of the company holding office from February 2012 to October 2015. However, the sanctioning authority declined sanction for prosecution of the accused Nos.1 and 3. Hence, the CBI filed the final report before the Special Judge, CBI Court, Thir
