2016 (11) TMI 1586 - HC - Indian Laws

Offences punishable under the provisions of the Prevention of Corruption Act (PC Act) 1988 - Petitioner has received illegal gratification - Held that - The material in support of the same and the further narration of the sequence of events, do not indicate a direct demand or receipt of illegal gratification by the petitioner, from any party. There is reference to accused no.2, the petitioner s son, or a the firm of which Accused no. 4 & 5 were partners, of having received huge amounts, which were said to be compensation amounts payable to land owners. The said compensation amounts were termed as additional compensation paid directly by Itasca and UTL to land owners through the firm of which accused no. 4 & 5 were partners - The said compensation amounts were termed as additional compensation paid directly by Itasca and UTL to land owners through the firm of which accused no. 4 & 5 were partners. These above circumstances are apparent, prima facie, but whether the said amounts were paid to and received on behalf of the petitioner cannot be presumed. Irregularities in allotment of lands - Held that - This was not a possibility, the allotment of land is not made by the petitioner as is evident from the facts stated. The allotment is made by the SHLCC. Undue influence on various persons including the officials of the KIADB - Held that - The role of the petitioner does not go beyond the stage of having been a ex-officio member of the SHLCC. The allegation is hence vague and would not lead to framing of any tenable charge. The case of the prosecution is that there were transfer of funds, which were characterized as illegal gratification that was ultimately received by the petitioner through the other accused. The transfer was as a result of a well engineered conspiracy involving two corporate bodies from whose accounts the monies came, namely, Itasca, purportedly represented by Accused no.3 and UTL, represented by accused no.6. Significantly, the said corporate bodies are not named in the charge sheet. This is inexplicable as there is no immunity available to the companies from prosecution, merely because prosecution would be in respect of offences for which punishment prescribed is mandatory imprisonment and fine. It is also to be kept in view that prosecution, conviction and sentencing are different stages in a criminal trial. The stage for sentencing is reached only after a verdict of guilt is pronounced after a full fledged trial. Further, for the reason that the two corporate bodies namely, Itasca and UTL not having been named in the charge sheet as the accused, the theory of conspiracy has no foundation and cannot be sustained against any of the accused. Petition allowed.

Summary

Issues Involved:
1. Allegations of illegal gratification and corruption.
2. Irregularities in the allotment of lands.
3. Exercising undue influence on officials.
4. Committing forgery.
5. Conspiracy involving multiple accused and entities.
6. Procedural aspects of investigation and filing of FIR.

Detailed Analysis:

1. Allegations of Illegal Gratification and Corruption:
The prosecution alleged that the petitioner and his son were involved in receiving illegal gratification through a well-engineered conspiracy involving M/s Itasca Software Development Private Limited (Itasca) and M/s United Telecom Company (UTL). The court noted that there was no direct evidence of the petitioner demanding or receiving illegal gratification. The alleged money transfers to the petitioner's son or through entities like Indu Builders did not conclusively indicate that the petitioner received illegal gratification.

2. Irregularities in the Allotment of Lands:
The petitioner, as an ex-officio member of the State High Level Clearance Committee (SHLCC), was accused of fast-tracking Itasca's application for land allotment. However, the court found that the allotment was made by the SHLCC, not by the petitioner individually. The SHLCC consisted of multiple high-ranking officials, including the Chief Minister, making it unlikely that the petitioner could unilaterally influence the decision.

3. Exercising Undue Influence on Officials:
The court found the allegations of the petitioner exercising undue influence on officials to be vague. The petitioner's role did not extend beyond being an ex-officio member of the SHLCC. There was no substantial evidence to support the claim that he influenced officials of the Karnataka Industrial Areas Development Board (KIADB) or others.

4. Committing Forgery:
The petitioner was accused of applying whitener to erase the word 'consent' from the draft proceedings of the SHLCC. The court noted that there was no material evidence to indicate that the petitioner committed this act. The final order of the SHLCC clearly stated that the land acquisition for Itasca was to be by consent only, nullifying the forgery allegation.

5. Conspiracy Involving Multiple Accused and Entities:
The prosecution's case was based on a conspiracy involving the petitioner, his son, and other accused, including the Managing Director of Itasca and the Chairman of UTL. However, the court highlighted that the corporate entities Itasca and UTL were not named in the charge sheet, which weakened the conspiracy theory. Additionally, the proceedings against the Managing Director of Itasca were quashed, and the Chairman of UTL had died, further diluting the conspiracy allegations.

6. Procedural Aspects of Investigation and Filing of FIR:
The petitioner argued that the investigation was conducted before the registration of the FIR, which is impermissible in law. The court noted that the material gathered in earlier cases was used to register the case against the petitioner, which was akin to registering a second FIR based on the same material. This procedural lapse diluted the evidentiary value of the material against the petitioner.

Separate Judgments:
The court allowed the petitions, setting aside the order rejecting the petitioner's application for discharge and quashing the proceedings against the petitioner and accused no.9. The court emphasized that the absence of the corporate entities in the charge sheet and the quashing of proceedings against a key conspirator rendered the conspiracy theory unsustainable.