2018 (1) TMI 1665 - HC - Indian Laws

Money laundering - criminal conspiracy - non-application of mind - criminal misconduct on the part of the public servant and the criminal conspiracy on his part with M/s. Emaar Properties to have their wrongful gain - HELD THAT - The ends of justice are to be understood by ascertainment of the truth as to the facts on balance of evidence on each side. With reference to the facts of the case the Court held that in the absence of any other method it has no choice left in the application of the Section except such tests subject to the caution to be exercised in the use of inherent jurisdiction and the avoidance of interference in details and directed providing of a legal practitioner. The Court should apply the test as to whether the uncontroverted allegations as made from the record of the case and the documents submitted therewith prima facie establish the offence or not. If the allegations are so patently absurd and inherently improbable that no prudent person can ever reach such a conclusion and where the basic ingredients of a criminal offence are not satisfied then the Court may interfere. The principle thus laid down is before issuing a process and taking cognizance the Court has to consider from the existing material whether case falls within the exception and only if not to say prima facie accusation on a complaint or final report to take cognizance for any criminal if makes out. It is something different of prima facie consideration at pre-cognizance stage to the post-cognizance defence available to the accused under any of the exceptions in detail to make out either from the prosecution material or from any material placed by accused to show he is not liable to be charged to face the ordeal of trial. When such is the case so far as the quash Court under Section 482 CrPC from the accused also entitled to ask by placing any material in defence to consider from facts and circumstances to subserve the ends of Justice irrespective of the complaint allegations make out case for taking cognizance where it deserves for quashing instead of continuing a lame prosecution with no purpose and by no need of inviting the accused to face the ordeal of trial. The very cognizance order against the Petitioner-A11 in its entirety since unsustainable as concluded for various reasons from consideration of the material on record is liable to be quashed - Petition allowed.

Summary

Issues Involved:
1. Validity of cognizance taken without sanction.
2. Allegations against the petitioner.
3. Requirement and validity of sanction under Section 197 CrPC and Section 19 PC Act.
4. Inherent powers of the High Court under Section 482 CrPC.
5. Abuse of process of law.

Detailed Analysis:

1. Validity of Cognizance Taken Without Sanction:
The court observed that the Special Judge initially recognized the need for sanction to take cognizance of the offences against the petitioner. However, the subsequent decision to take cognizance without sanction was deemed impermissible. The court highlighted that Section 197 CrPC mandates sanction for prosecuting a public servant for acts done in discharge of official duties. The review of the earlier decision by the Special Judge was barred under Section 362 CrPC, making the cognizance order unsustainable.

2. Allegations Against the Petitioner:
The allegations against the petitioner, who was the Vice Chairman and Managing Director (VC & MD) of APIIC, included various acts purportedly done in furtherance of a criminal conspiracy. These included not amending the memorandum and articles of association, recommending a lower land price, agreeing to lease rentals contrary to approvals, and not objecting to the sale of villa plots. The court found that these actions were in line with the policy decisions of the government and did not indicate any criminal conspiracy or misconduct by the petitioner.

3. Requirement and Validity of Sanction Under Section 197 CrPC and Section 19 PC Act:
The court emphasized that sanction under Section 197 CrPC is necessary for prosecuting a public servant for IPC offences committed in discharge of official duties. The sanction refusal by the State Government was binding, and the subsequent sanction by the Central Government was invalid. The court cited various precedents to underline that once sanction is refused by the competent authority, the prosecution cannot proceed without challenging the refusal or presenting fresh material.

4. Inherent Powers of the High Court Under Section 482 CrPC:
The court reiterated the scope of inherent powers under Section 482 CrPC to quash proceedings that constitute an abuse of process or are otherwise unjust. It was noted that these powers are to be exercised to prevent harassment and ensure justice. The court found that the proceedings against the petitioner were an abuse of process, given the lack of valid sanction and the absence of prima facie evidence of criminal conspiracy or misconduct.

5. Abuse of Process of Law:
The court observed that the prosecution against the petitioner was initiated without proper application of mind and in violation of mandatory legal requirements. The continuation of such prosecution was deemed to be an abuse of process of law. The court highlighted that the inherent powers of the High Court are meant to prevent such abuse and ensure that justice is served.

Conclusion:
The court allowed the quash petition, setting aside the cognizance order and quashing the proceedings against the petitioner. The petitioner was acquitted, and his bail bonds were canceled. The decision underscores the importance of adhering to legal requirements for sanction and the role of the High Court in preventing misuse of judicial processes.