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TMI Blog1999 (12) TMI 885X X X X Extracts X X X X X X X X Extracts X X X X ..... r project through an open bidding process. The High Court by an order made on February 27, 1998 granted some of the reliefs sought for in the writ petition. Against this order, the petitioners in the writ petition as well as the respondents have come in two sets of appeals. The High Court formulated 13 points (though noted as 14 in the order under appeal) which appeared to it to be of suspicious nature leading to issue of the following direction: 1. The respondent State (R-1) is directed to get a FIR registered with the CBI under the provisions of Delhi Special Police Establishment Act for various cognizable offences without naming any person or group of persons as accused. 2. Upon registration of the FIR, the Director General of the CBI shall direct the investigation to be conducted by an officer under the supervision and control of an official not below the rank of Deputy Director General of the CBI. The investigation shall not be influenced by any of the observation made by us for determining the desirability of the registration of FIR and investigation into the allegations. 3. Such investigation shall be commenced without any delay and completed within one year from th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... projects being carried on by the appellant outside Hong Kong but not in India as to whether actually such amount was incurred in any other country or the entry which was subsequently written off is a catalogue to hide the alleged kick backs and bribes paid for the alleged favours shown to M/s Cogentrix in connection with the setting up of thermal power plant of 1000 MW capacity at Mangalore. 4. The writ petitioners had referred to various other circumstances, in support of their cases which were vehemently denied by the respondents therein, but the High Court did not venture to refer to such circumstances and scrutinise them on the basis of the allegations and counter-allegations made by the parties. The High Court noticed that the circumstances noted could not be termed as frivolous, baseless, concocted or characterised as malafide made only for the purpose of defaming the appellant and in a very characteristic way proceeded to observe as follows: The petitioners have referred to various other circumstances in support of their contention which have been refuted and vehemently denied by the respondents. We do not make a venture to refer to all such circumstances and scrutini ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 408, 409, 419, 420, offences under Chapter XVIII of the I.P.C., offences under the Companies Act, under the FERA and various other statutes. Reference to various offences is only illustrative and neither conclusive nor indicative. 5. The learned Counsel on either side have referred to various decisions as to when a complaint can be made or court can order investigation but in our view it is not necessary to refer to any of them as we propose to examine whether any legal or factual basis existed for the High Court to make order under appeal. We will examine the case in a chronological manner with reference to facts and draw our inferences based on the material on record, the question for consideration being whether the probe ordered is justified or not. 6. The Central Electricity Authority conducted a power survey in India which indicated that the southern region including the State of Karnataka would face acute power shortage both in terms of peaking capacity as well as energy requirement. The Survey further indicated that an addition of 38,000 MW of electric power would become necessary by the VIIIth Five Year Plan. The National Thermal Power Corporation [for short 'NTP ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ipation in the electricity sector and decide on the steps to be taken for promotion of the scheme. (vi) The Board will consider and decide on matters regarding the scheme for encouraging private enterprise participation in the electricity sector which may be referred to the Board by the Department of Power, including any specific proposal from a private entrepreneur coming under the scheme: 7. Constitution of the Board: The Board shall comprise the following: From the Government of India: (1) Cabinet Secretary - Chairman (2) Secretary (Deptt. of Power) - Member (3) Secretary (Finance) - Member (4) Additional Secretary (Banking) - Member (5) Secretary (Planning Commission) - Member (6) Secretary (Environment Forest) - Member (7) Secretary (Industrial Development) - Member (8) Secretary (Technical Development) - Member (9) Chairman, CEA From the State Governments: (10) Chief Secretary to the concerned State Governments will be co-opted as required. 7. The proposal to set up the project by NTPC with the aid from USSR did not materialise for various reasons including the disintegration of USSR. The Government of India invited Cogentrix ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Under the directions of the new Government, all MOUs signed by the previous Government were to be re-examined and brought before the Cabinet for its consideration again. That decision was taken on December 21, 1992. The Chief Secretary of Government of Karnataka conducted meetings to review all MOUs which was attended by the Senior Officers of the Government such as Additional Chief Secretary, Finance Commissioner, Secretary to the Energy Minister, Energy Secretary and Chairman, Karnataka Electricity Board. Such review was held from January 23, 1993 to March 3, 1999. M/s Cogentrix thereafter requested the Government to extend the MOU dated July 30, 1992 upto February 1, 1993 and stating that due to sitting difficulties at Bangalore it was agreed that the Bangalore project be deferred and that a 1000 MW project be developed at Mangalore. A delegation headed by the Chief Secretary of the Government of Karnataka held meeting with the officers of the Government of India, such as, the Principal Secretary to the Prime Minister, Union Power Secretary and Union Foreign Secretary on 25th and 26th February, 1993 as a follow up thereto. It was noticed in the meeting held on February 27, 1993 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r purchase agreement stood revised on January 18, 1996. Techno-economic clearance was issued by the Central Electricity Authority on July 10, 1996. 9. In this case, we are constrained to observe that the High Court has lost sight of certain broad features of the case. The necessity for establishing a thermal power station which is, in detail, considered by the High Court of Karnataka in Jana Jagruthi Samithi v. Union of India ILR1991KAR2939 . The circumstance in which the Government of Karnataka took decision to invite foreign investors, the manner in which it was done, was also subject of consideration in Indian Council for Enviro-Legal Action and Anr. v. Union of India and Ors. ILR1997KAR2956 , and the High Court rejected objections thereto which was not interfered with in SLP by this Court and thus that order has become final. The circumstance in which the National Thermal Power Corporation which wanted to establish a power station with the collaboration of USSR was dropped on the dissolution of the Soviet Union is not in doubt. The proposal to give the appellants the contract to establish a power station near Mangalore was taken up for consideration when Mr. Bangarappa was t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t have been paid in a foreign country, no foundation for the claim is laid in the petition. The China Light and Power Company claims that neither the company nor any group company maintained a bank account in British Virgin island at any time and accounting have always been maintained in Hong Kong. 1359 British Virgin Island Companies, including the China Light and Power (International) Ltd. having place of business in Hong Kong are registered with the Registrar of Companies in 1997. The allegation of bribery made against Mr. Deve Gowda is based on a letter written by Mr. George Fernandes and the basis of this letter is again not clear. Thus the foundation laid for the whole case arises out of suspicion alone on the strength of dubious and amorphous material. On such material, no case can be registered, much less, an investigation can be done. We would not have hazarded to consider that material placed before us but in order to allay the fears expressed by the parties concerned, necessarily we had to undertake that exercise. 11. One of the questions raised by the writ petitioner in the High Court is regarding financial and technical capability of the sponsor of the project. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ic clearance and detailed project report gives breakdown of the various project costs including sponsors development expenses. Detailed project reports prepared by the Cogentrix is in conformity with the guidelines of the Central Electricity Authority. General Breakdown of the project costs and balance sheet were subject matters of consideration. The official guidelines require the development expenses to be shown separately and such expenses, therefore, could, by no stretch of imagination, be considered as bribes or greased money. 13. The detailed project report was advertised and 838 representations had been received and the same were forwarded to the State Government for onward transmission to the Central Electricity Authority. The Central Electricity Authority has examined these objections and comments offered by the CLP or the Cogentrix before giving its approval. Thus the techno-economic clearances given to the project cannot be examined by courts to arrive at whether they are technically feasible or not or whether in granting the same strange things have happened giving rise to suspicion that something has been done by way of undue favour. 14. The reference of the High ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to any suspicion. We have adverted in detail to the balance sheet showing incurring of expenses in India. Thus none of the thirteen circumstances noticed by the High Court can be characterised as giving rise to any suspicion, much less a basis for investigation by a criminal investigating agency. 15. It is difficult to visualise that when an agreement had been entered into with a foreign company it has been done under suspicious circumstances, particularly when it had stood the test of scrutiny under three different Governments headed by at least three different Chief Ministers and when the examination of the project and its approval was considered by different statutory and other agencies of the Government of India. Could it still be said that there had been kickbacks to any one of them or all of them in the matter of entering into a Memorandum of Understanding or in continuation of the same? The law, in fact, is otherwise. The acts of persons will not be subject of criminal investigation unless a crime is reported to have been committed or reasonable suspicion thereto arises. On mere conjecture or surmise as a flight of fancy that some crime might have been committed, somewhe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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