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TMI Blog2009 (8) TMI 1210X X X X Extracts X X X X X X X X Extracts X X X X ..... State of Madhya Pradesh. Respondent No. 2 D.V.S.R. Sarma and the respondent No. 7 S.W. Mohgoankar were the Secretary to the Government of Madhya Pradesh. Respondent No. 3 P.V. Srinivasaiyah was the Engineer-in-Chief and the respondent No. 4 A.S. Laxminarsimhaiya was the Deputy Secretary in the Government of Madhya Pradesh. Respondent No. 5 V.R.B. Gopal and the respondent No. 6 M.N. Nadkarni were the Chief Engineers, Hasdeo Bango Project. Respondent No. 11 R.P. Khare was the Secretary, Control Board for Major Projects. 5. Appellant under the aegies of the World Bank undertook construction of the Hasdeo Bango Masonry dam project. For the aforementioned purpose, the respondent Nos. 8, 9 and 10 herein, viz.,M/s Progressive Constructions Pvt. Ltd., M/s Prasad & Company, M/s SEW Construction Co. (hereinafter referred to as "the contractors") were awarded contracts in terms whereof they were required to excavate stones etc. from Therma Pahar Quarry, which was situate at only 12 kms. away from the site, for use of the stone to be extracted therefrom for construction of masonry spillway. 6. One of the terms of the said contract is as under: "...The tenderer should satisfy himself regard ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not available from Therma quarries of Forest Department acquired for this purpose and Geologist, Geological Survey of India had intimated that about one lakh cum. of rubble can only be extracted from Therma quarries. For completion of this major dam about ten lakh cum. rubble & metal are needed. Out of which 1 lakh cum. can be extracted from Therma quarry, about three lakh cum. can be used out of the stone received from excavation of foundation of dam, remaining 6 (six) lakh cum. is required from adjacent stone quarries like Katghora, Hukra & Maheshpur. Hence, I have requested in my letter cited above (copy enclosed) to additional Collector, Korba, to reserve rubble quarries in the surroundings of the above villages so that rubble from these quarries can be extracted for completion of the Bango Dam in time. Now I understand that you have proposed the above quarries for auction on 20th & 21st Oct.'83. I request to delete the rubble quarries situated in the surrounding of Katghora, Hukra & Maheshpur from the purview of auction and transfer to Irrigation Department. Depending upon the quantity of rubble required by each agency executed masonry works at Bango Dam, allotment of in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red to the requirement. 3. It was reported that the quantum of useful rubble available in the entire Therma Pahad Hills is to the tune of one lakh cum. against the total requirement of 8 lakh cum. for the entire dam. This was based on the detailed investigations and report of the Resident Geologist. Even this quantity can be extracted with much difficulty. Therma Pahad Quarry on the visual appearance and the random bore holes, initially appeared to be good. As such this was declared as quarry for masonry stone and accordingly estimates prepared and designated as the specified quarry in the quarry map enclosed along with the agreements. The contractors naturally could not have investigated the quarry by actual opening/ operation, and have inspected the quarry with the data available to them. Therefore neither department nor the contractor could have foreseen the non availability of useful stone in the required quantity from the designated quarry." It was requested: "It is therefore requested that the sanction may be obtained for payment of additional leads and communicated. However, the payment towards additional wasteful expenditure incurred in therma quarries as claimed by co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Secretary of the Major, Medium and Minor Irrigation Department, Bhopal by a letter dated 11.01.1985 inter alia making the following recommendations: "(i) Permitting the Chief Engineer for declaring Katghora quarry as an additional quarry for balance quantity of rubble quarry for rubble for masonry dam other than one lakh cubic meter of rubble, as assessed by the geologist to be extracted by the contractors from Therma Pahad quarry as far as possible in the contracts mentioned in this letter. (ii) To allow payment of additional leads from Katghora quarry for cum of masonry at the rates detailed in table at para 5.3 above." Along with the said letter, various other documents were enclosed as specified therein including a letter dated 4.05.1990, wherein it was inter alia stated: "10. In view of the above, the Chief Engineer submitted proposals on 4.07.85 for Government Orders. According to the above proposals sanction to pay extra lead amounting to Rs. 1,23,23,767/- has been sought. This amount is about 3% of the total amount of contract of Rs. 41.77 crores. The Chief Engineer had also sought the opinion of the World Bank, and the World Bank gave a suggestion to deal the is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tage." 19. However, the contractors invoked the arbitration agreement contained in the said contract in the year 1987 and an ad hoc settlement was proposed. 20. The matter was placed before the Financial Adviser. The Financial Adviser in his note dated 4.01.1991 to the Secretary, while stating that the Financial Adviser functions as a consultant offering comments on cases referred to him in the light of his background, experience and expertise and going by the facts placed before him which may not be treated as a substitute for vetting by the Finance Department wherever such vetting is required under the rules of governmental business, inter alia made the following comments: "...However, since the whole contract action was based on the presumption that the required quantity of material of required specification would be available from a quarry with in 12 KM of the work site, it can be reasonable assumed that the contractors have quoted their rates on this assumption. The departmental estimates were also based on this assumption. Since, later on, this assumption was found to be invalid and majority of the material had to be obtained from a quarry with an average lead of 22 KM fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r may be informed to take undertakings from the contractors before making the payment." The Financial Adviser was asked to examine the said proposal in details. Some discussions apparently were held and it was found necessary to obtain the following information before taking decision at the government level: "1. After the inspection of the Geologists how much quantity has been brought from Therma Pahad by each contractor. 2. How much quantity has been brought from Katghora quarry. 3. How the records are kept by the Department about the quantity of stones brought from different quarries." A draft letter was also prepared. 23. On or about 6.04.1991, one Shri Uday Shinde in his note stated that the Chief Engineer had not sent any detail in regard to Block 31-38 as in the agreement only Therma Pahar quarry had been shown for the balance work and as the original file was sent to the Hon'ble Minister, it was not possible to deal with the case. The file was re-submitted and the amount payable to the contractor for additional lead was again put up for administrative approval. Yet again, the Engineering in-Chief Committee was asked to examine the matter. 24. In a note to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eneral reported: "a) The clause of the agreement noted above and the quarry chart clearly bring out that in the event of change of quarry on whatever reasons no claim will be entertained and contractor should before quoting rates, visit the quarry site and satisfy himself regarding quantity and quality of the material available. Thus, the sanction appears a negotiated settlement beyond the contractual provisions, for which concurrence of Finance Department ought to have been obtained. b) The PRC considered this as a claim case which was to be decided by Arbitrator under M.P. Adhikaran Adhiniyan, 1983. c) The Member, World Bank suggested to resolve the matter within the contractual limits. d) The Secretary Irrigation had earlier rejected the case as it was not admissible. e) The rates quoted by the contractors were inclusive of all lead and lift, being item rate tender." The Auditor General of India also took note of the said report, stating: "Therefore, in spite of the report of the Geologist that the good quality of stone was available in sufficient quantities in the upper portion of the quarry situated in the hill mentioned in the agreement and in spite of there bein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i D.V.S.R. Sharma, Secretary, working in the Ministry of Water Resources, Government of Madhya Pradesh and other employees and contractors acted as mentioned above, which is punishable under Section 13(1)(D)(ii and iii) read with Section 120B IPC, which is within the jurisdiction of this Court. Hence, I hereby direct that you will be tried for the offence mentioned above by this Court." 33. Aggrieved by and dissatisfied therewith, the respondents filed revision applications before the High Court, which by reason of the impugned order have been allowed. The State is, thus, before us. 34. Mr. K.T.S. Tulsi, learned senior counsel appearing on behalf of the appellant, in support of the appeal, inter alia would submit: (i) The High Court committed a serious error in opining that an order of sanction in terms of Section 197 of the Code of Criminal Procedure was required to be obtained despite the fact that the respondent Nos. 1 to 7 were no longer holders of public office(s). (ii) While exercising its revisional jurisdiction, the High Court could not enter into the question of appreciation of evidence as also the probative value of the materials brought on record, contrary to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xercise of its jurisdiction under Sections 397 and 401 of the Code of Criminal Procedure were entitled to consider the entire materials on record for the purpose of arriving at a finding as to whether the contents thereof, even if taken to be correct in their entirety, constituted a prima facie case against the accused or not. (ii) It would not be correct to contend that although all the documents collected during investigation form part of the final report submitted by the Special Police Establishment in terms of Sub- section (5) of Section 173 of the Code of Criminal Procedure, for the purpose of framing of charge or otherwise the prosecution can rely only on a few of them so as to make a distinction between the documents which are in favour of the prosecution and those which are in favour of the accused. (iii) The materials brought on record clearly show that the concerned authorities found it necessary to explore the possibility of procuring stones of requisite quality from other sources as they had proceeded on a wrong premise that stone of requisite quality to the extent of 8 lakh cubic meters would be available in the quarry in question. (iv) Although the contract coul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sue any direction to make payment but merely asked the respondent No. 2 to have a re-look at the entire matter as prior to the purported opinion of Mr. Billore, as contained in his note dated 1.05.1991 he had opined otherwise, viz., not in the tune of the recommendations made by the Quality Control Department, i.e., in favour of the contractors. (xi) There is nothing on record to show that the respondent Nos. 1 to 7 herein have done any act which was beyond their official duty and hence, the impugned judgment is unassailable. 36. The question raised before us is required to be determined on the backdrop of factual matrix involved herein. We have taken into consideration in details the background materials only with a view to consider as to whether the High Court was right in opining that no case for framing of charges against the respondents was made out. The fact that the State entered into contracts with the respondent Nos. 8, 9 and 10 is not in dispute. The basic terms of the contract, which we have taken note of, are also not in dispute. What is in dispute is the interpretation and application thereof. 37. The contract contained an arbitration clause. The respondents herei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... though the Mines Department of the State intended to grant `Quarry lease' in favour of others having regard to the requirements of the State, the said quarries were reserved, subject to certain conditions. 42. The respondent Nos. 8 to 10, in view of the provisions of the Mines and Mineral (Regulation and Development) Act, 1957 and the Madhya Pradesh Minor Mineral Concession Rules could not have on their own undertaken mining operation for the purpose of extracting the said minor mineral. They could have done so only on a licence granted in their favour by the Collector/State. However, as the hillocks of the villages in question were reserved for departmental use, only by reason thereof the contractors could carry on mining operation thereat and not otherwise. It was, therefore, a conscious decision on the part of the competent authorities of the State. 43. The contract itself suggests that there was a possibility of dispute in regard to allocation of the parts of the quarries. A dispute resolution mechanism by creating a forum viz. the Office of the Superintending Engineer was created. 44. The intra-departmental and inter-departmental correspondences and notesheets to which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -section (2) of Section 13 provides that any public servant who commits criminal misconduct shall be punishable with imprisonment for a term which shall be not less than one year but which may extend to seven years and shall also be liable to fine. 49. Criminal conspiracy has been defined in Section 120A of the Indian Penal Code, 1860 to mean: "When two or more persons agree to do, or cause to be done,-- (1) an illegal act, or (2) an act which is not illegal by illegal means, such an agreement is designated a criminal conspiracy: Provided that no agreement except an agreement to commit an offence shall amount to a criminal conspiracy unless some act besides the agreement is done by one or more parties to such agreement in pursuance thereof. Explanation.--It is immaterial whether the illegal act is the ultimate object of such agreement, or is merely incidental to that object." Section 120B of the Indian Penal Code provides for punishment for criminal conspiracy. 50. Criminal conspiracy is an independent offence. It is punishable separately. Prosecution, therefore, for the purpose of bringing the charge of criminal conspiracy read with the aforementioned provisions of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, in regard to the appreciation of evidence relating to the conspiracy, the Court must take care to see that the acts or conduct of the parties must be conscious and clear enough to infer their concurrence as to the common design and its execution." We may also notice that in Ram Narayan Popli v. CBI [(2003) 3 SCC 641], it was held: "...Law making conspiracy a crime is designed to curb immoderate power to do mischief which is gained by a combination of the means. The encouragement and support which co-conspirators give to one another rendering enterprises possible which, if left to individual effort, would have been impossible, furnish the ground for visiting conspirators and abettors with condign punishment..." In Yogesh @ Sachin Jagdish Joshi v. State of Maharashtra [(2008) 6 SCALE 469], this Court opined: "23. Thus, it is manifest that the meeting of minds of two or more persons for doing an illegal act or an act by illegal means is sine qua non of the criminal conspiracy but it may not be possible to prove the agreement between them by direct proof. Nevertheless, existence of the conspiracy and its objective can be inferred from the surrounding circumstances and the cond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ense, but not negligence or carelessness.' Misconduct in office has been defined as: "Any unlawful behaviour by a public officer in relation to the duties of his office, willful in character. Term embraces acts which the officer holder had no right to perform, acts performed improperly, and failure to act in the face of an affirmative duty to act." In P. Ramanatha Aiyar's Law Lexicon, 3rd edition, at page 3027, the term 'misconduct' has been defined as under: "The term `misconduct' implies, a wrongful intention, and not a mere error of judgment. Misconduct is not necessarily the same thing as conduct involving moral turpitude. The word `misconduct' is a relative term, and has to be construed with reference to the subject matter and the context wherein the term occurs, having regard to the scope of the Act or statute which is being construed. Misconduct literally means wrong conduct or improper conduct." [See also Bharat Petroleum Corpn. Ltd. vs. T.K. Raju, [2006 (3) SCC 143]." 54. Even under the Act, an offence cannot be said to have been committed only because the public servant has obtained either for himself or for any other person any pecunia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r had not been completely exonerated also required to be considered. If exoneration in a departmental proceeding is the basis for not framing a charge against an accused person who is said to be similarly situated, the question which requires a further consideration was as to whether the applicant before it was similarly situated or not and/or whether the exonerated officer in the departmental proceeding also faced same charges including the charge of being a party to the larger conspiracy." 58. There cannot be any doubt whatsoever that the tests for the purpose of framing of charge and the one for recording a judgment of conviction are different. A distinction must be borne in mind that whereas at the time of framing of the charge, the court may take into consideration the fact as to whether the accused might have committed the offence or not; at the time of recording a judgment of conviction, the prosecution is required to prove beyond reasonable doubt that the accused has committed the offence. 59. In this case, the probative value of the materials on record has not been gone into. The materials brought on record have been accepted as true at this stage. It is true that at th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exatious criminal proceedings for offences alleged to have been committed by them while they are acting or purporting to act as public servants. The policy of the legislature is to afford adequate protection to public servants to ensure that they are not prosecuted for anything done by them in the discharge of their official duties without reasonable cause, and if sanction is granted, to confer on the Government, if they choose to exercise it, complete control of the prosecution. This protection has certain limits and is available only when the alleged act done by the public servant is reasonably connected with the discharge of his official duty and is not merely a cloak for doing the objectionable act. If in doing his official duty, he acted in excess of his duty, but there is a reasonable connection between the act and the performance of the official duty, the excess will not be a sufficient ground to deprive the public servant from the protection. The question is not as to the nature of the offence such as whether the alleged offence contained an element necessarily dependent upon the offender being a public servant, but whether it was committed by a public servant acting or p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to do so. Be he an Executive Engineer, Superintending Engineer, Chief Engineer, Engineer-in-Chief, Secretary or Deputy Secretary, matters were placed before them by their subordinate officers. They were required to take action thereupon. They were required to apply their own mind. A decision on their part was required to be taken so as to enable them to oversee supervision and completion of a government project. The Minister having regard to the provisions of the Rules of Executive Business was required to take a decision for and on behalf of the State. Some of the respondents, as noticed hereinbefore, were required to render their individual opinion required by their superiors. They were members of the Committee constituted by the authorities, viz., the Minister or the Secretary. At that stage, it was not possible for them to refuse to be a Member of the Committee and/ or not to render any opinion at all when they were asked to perform their duties. They were required to do the same and, thus, there cannot be any doubt whatsoever that each one of the respondent Nos. 1 to 7 was performing his official duties. 63. For the purpose of attracting the provisions of Section 197 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cial character of the person doing it." In affirming this view, the Judicial Committee of the Privy Council observe in Gill case: "A public servant can only be said to act or purport to act in the discharge of his official duty, if his act is such as to lie within the scope of his official duty ... The test may well be whether the public servant, if challenged, can reasonably claim that, what he does, he does in virtue of his office." Hori Ram case is referred to with approval in the later case of Lieutenant Hector Thomas Huntley v. King- Emperor but the test laid down that it must be established that the act complained of was an official act appears to us unduly to narrow down the scope of the protection afforded by Section 197 of the Criminal Procedure Code as defined and understood in the earlier case. The decision in Meads v. King does not carry us any further; it adopts the reasoning in Gill's case." The said principle has been reiterated by this Court in B. Saha v. M.S. Kochar [(1979) 4 SCC 177] in the following terms: "17. The words "any offence alleged to have been committed by him while acting or purporting to act in the discharge of his official duty" employed in S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... liberal and wide construction so far its official nature is concerned. For instance a public servant is not entitled to indulge in criminal activities. To that extent the section has to be construed narrowly and in a restricted manner. But once it is established that an act or omission was done by the public servant while discharging his duty then the scope of its being official should be construed so as to advance the objective of the section in favour of the public servant. Otherwise the entire purpose of affording protection to a public servant without sanction shall stand frustrated. For instance a police officer in the discharge of duty may have to use force which may be an offence for the prosecution of which the sanction may be necessary. But if the same officer commits an act in the course of service but not in the discharge of his duty and without any justification therefor then the bar under Section 197 of the Code is not attracted..." 64. Reliance has been placed by Mr. Tulsi on Parkash Singh Badal v. State of Punjab and Others [(2007) 1 SCC 1] wherein this Court held: "38. The question relating to the need of sanction under Section 197 of the Code is not necessarily ..... X X X X Extracts X X X X X X X X Extracts X X X X
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