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2024 (9) TMI 1681 - SC - Indian LawsValidity of the sanction order can be challenged at any stage of the proceedings or not - violation of Section 45(2) of the UAPA r/w Rules 3 4 - violation of statutory timelines and requirement of independent review which includes application of mind - applicability of statutory exemption Under Section 22A of the UAPA. Whether the Validity of the Sanction Order can be challenged at any stage? - HELD THAT - The UAPA does not provide for any such saving of the sanction. This implies that, in the wisdom of the legislature, the inbuilt mechanism of the Act of having two authorities apply their mind to the grant of a sanction, is sufficient. This emphasizes the role and sanctity of the operation to be carried out by both these authorities. In order to challenge the grant of sanction as invalid, the grounds that can be urged are that (1) all the relevant material was not placed before the authority; (2) the authority has not applied its mind to the said material; and (3) insufficiency of material. This list is only illustrative and not exhaustive. The common thread that runs through the three grounds of challenge above is that the party putting forward this challenge has to lead evidence to such effect. There are no hesitation in holding that while the treasured right of an Accused to avail all remedies available to him recognised under law, in ordinary circumstances challenge to sanction under UAPA should be raised at the earliest possible opportunity so as to enable the Trial Court to determine the question, for its competence to proceed further and the basis on which any other proceeding on the appellate side would depend on the answer to this question. Whether a violation of Section 45(2) of the UAPA r/w Rules 3 4, if any, vitiates the proceedings? In other words, whether violation of - (a) statutory timelines and (b) the requirement of independent review which includes application of mind, are necessary aspects of procedure without which, any transaction under the UAPA shall be compromised to a point that its sanctity is rendered questionable? - HELD THAT - The rules provide a seven day period within which the concerned authority is to make its recommendation on the basis of materials gathered by the investigating officer and a further seven days period for the government to grant sanction for prosecution, having considered the report of the authority - The ins and outs of the Appellant's contention is that the said timelines were not followed and, in fact, the first sanction was granted more than a year after the recommendation was moved. This contention ties into another submission that there was no independent review on the part of both recommending authority and central government, as the sanction was merely granted within a day each. Whether timelines were directory or mandatory? - HELD THAT - The observations in VIJAY RAJMOHAN VERSUS STATE REPRESENTED BY THE INSPECTOR OF POLICE 2022 (10) TMI 1267 - SUPREME COURT regarding the power of sanction being open to the standard principle of judicial review; the same being inbuilt in our legal structure; public confidence being at stake if a rule of law is violated, are principles that in our considered view it will apply equally to sanctions under UAPA. In context of the PC Act, it has been held that non- compliance of a mandatory period cannot ipso facto lead to quashing of criminal proceedings. This is where a difference emerges between the PC Act and the UAPA. The implication, social as well as legal of both these acts diverges, in as much as the latter entails far graver consequences. The UAPA provides for a detailed procedure which is to be followed in granting of sanction and undoubtedly, the same must be followed in absolute letter and spirit. Section 52 of the UAPA grants power to the Central Government to make Rules for the purpose of carrying out the provisions of the Act. Specifically, Section 52(2)(ee) deals with the present situation, i.e., enables the Government to prescribe the time for recommendation and grant of sanction Under Section 45. The 2008 Rules are unequivocal in both, using the word 'shall' as also providing a specific time period for both activities, i.e., making recommendation and granting sanction. In matters of strict construction, when a timeline is provided, along with the use of the word 'shall' and particularly when the same is in the context of a law such as the UAPA, it cannot be considered a mere technicality or formality. It demonstrates clear intention on the part of the Legislature. A compulsion has been imposed, and for compliance with that compulsion, a timeline has been provided. While the legislation is aimed at curbing unlawful activities and practices detrimental to national security and accordingly, provides the authorities of the Government ample power to undertake and complete all procedures and processes permissible under law to that end, at the same time the interest of Accused persons must also be safeguarded and protected. It is expected of the Executive, in furtherance of the ideal of protection of national security, that it would work with speed and dispatch - There have to be certain limitations within which administrative authorities of the Government can exercise their powers. Without such limitations, power will enter the realm of the unbridled, which needless to state is, antithetical to a democratic society. Timelines in such cases, serve as essential aspects of checks and balances and of course, are unquestionably important. Independent review - bone of contention in this regard is that since both the recommending and the granting authorities took merely a day each in performing their respective functions, the requirement of an independent review which is to be undertaken by both authorities has been left unfulfilled thereby vitiating the sanction in question - HELD THAT - The import of the term independent review as can be understood from the above is a re-examination, scrutiny or critique of something which is not dependent or subject to control by any other factor or authority. In the present facts, independent review would mean a contemplation or study of the material gathered by the investigating officer to conclude as to whether or not a sanction to proceed under the provisions of the UAPA ought to be granted. Similarly, at the next stage, the sanctioning authority is to mull over and critically notice both the materials gathered as also the conclusion drawn by the recommending authority, in its act of granting sanction - The legislative intent in bringing about the aspect of independent review, by way of an amendment brought into effect from 31st December 2008, within Section 45 of the UAPA is required to be noticed. There is nothing on record to show that relevant material was not placed before the authorities. There is no question, as there rightly cannot be, on the competence of either of the authorities. Therefore, solely on the ground that the time taken was comparatively short or even that other orders were similarly worded cannot call the credibility of the sanction into question - independent review as well as application of mind are questions to be determined by way of evidence and as such should be raised at the stage of trial, so as to ensure that there is no undue delay in the proceedings reaching their logical and lawful conclusion on these grounds. An order passed by an administrative authority is not to be tested by way of judicial review on the same anvil as a judicial or quasi-judicial order. While it is imperative for the latter to record reasons for arriving at a particular decision, for the former it is sufficient to show that the authority passing such order applied its mind to the relevant facts and materials - It is not incumbent upon such authority to record detailed reasons to support its conclusion and, as such, the orders challenged herein, cannot be faulted with on that ground. Misjoinder of Charges and Violation of Code of Criminal Procedure - HELD THAT - Naseeb Singh 2021 (10) TMI 1409 - SUPREME COURT holds that a separate trial would not be contrary to law unless a miscarriage of justice can be demonstrated. Similarly, a joint trial, if held, after having considered the two factors given above, cannot be said to be ipso facto prejudicial to the parties. Whether, in the facts, the statutory exemption Under Section 22A of the UAPA applies to the Appellant who claims to be unaware of the affairs of the company? - HELD THAT - For Section 22A to apply (a) offence has to committed by a company; (b) all persons who at the time of the offence were in control of, or responsible for, the company's affairs shall be deemed guilty; (c) such person would be saved from guilt as under (b) if they can demonstrate that such act was (i) not in their knowledge; (ii) they had taken reasonable care to prevent such offence from taking place. The section further provides that if it can be proved that the offence committed by the company was (1) with consent; (2) in connivance of; (3) attributable to neglect on the part of any promoter, director, manager, secretary or any other officer of the company, then they shall be held guilty - this Court cannot, at this stage, decide whether Section 22A applies to the Appellant or not. This is once again a matter for evidence. Conclusion - i) The validity of sanction should be challenged at the earliest instance available, before the Trial Court. If such a challenge is raised at an appellate stage it would be for the person raising the challenge to justify the reasons for bringing the same at a belated stage. Such reasons would have to be considered independently so as to ensure that there is no misuse of the right of challenge with the aim to stall or delay proceedings. ii) The timelines mentioned in Rules 3 4 of the 2008 Rules are couched in mandatory language and, therefore, have to be strictly followed. This is keeping in view that UAPA being a penal legislation, strict construction must be accorded to it. Timelines imposed by way of statutory Rules are a way to keep a check on executive power which is a necessary position to protect the rights of Accused persons. Independent review by both the authority recommending sanction and the authority granting sanction, are necessary aspects of compliance with Section 45 of the UAPA. iii) Sections 218-222, Code of Criminal Procedure, are not violated. iv) Whether or not the exemption Under Section 22A applies is a matter to be established by the way of evidence for the person claiming such exemption has to demonstrate that either he was not in charge of the affairs of the company which has allegedly committed the offence, or that he had made reasonable efforts to prevent the commission of the offence. This, once again, is a matter for the Trial Court to consider and not for this Court to decide at this stage, keeping in view that the trial is underway and proceeded substantially. Appeal dismissed.
1. ISSUES PRESENTED and CONSIDERED The core legal questions considered in this judgment are:
2. ISSUE-WISE DETAILED ANALYSIS Issue 1: Suo-moto Power of Central Government
Issue 2: Legality of Sanction Order
Issue 3: Cognizance Order and Framing of Charges
Issue 4: Validity of Sanction Challenge at Any Stage
Issue 5: Non-compliance with UAPA and Rules
Issue 6: Independent Transactions Argument
Issue 7: Applicability of Section 22A Exemption
3. SIGNIFICANT HOLDINGS
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