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TMI Blog2011 (12) TMI 759X X X X Extracts X X X X X X X X Extracts X X X X ..... substantive offence under Section 13(1)(d) read with Section 13(2) Prevention of Corruption Act, 1988. The Appellants (hereafter referred to by their names, for convenience) also challenge the order sentencing them to periods of two and three years? rigorous imprisonment ( RI ) and fine of ₹ 1 lakh, in default of which they were to further undergo simple imprisonment ( SI ) for six months for the offences. The appeals were received by the Division Bench, upon a reference regarding the correct interpretation of Section 13(1)(d) of the Prevention of Corruption Act 1988 (hereafter the 1988 Act ). 2. Before proceeding it would be necessary to extract the relevant portions of the order (dated 24.09.2009) referring the appeals to the Division Bench. It reads as follows: The issues that arise 30. In the present case the evidence is essentially in the form of notes on file dated 25th May and 24th July 1993 of Smt. Ghosh and the notes dated 31st August, 19th November and 13th December 1993 of Sri Sukh Ram. There are cases under the PC Act 1988 in which a trap is laid to gather evidence of the public servant accepting illegal gratification or in which a raid is undertaken ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and other relevant circumstances it clearly appears that that must have been the intention of Parliament.' The formulations of the rule of construction which have been accepted by the Privy Council and the Supreme Court are those stated by Wright, J. in Sherras v. De Rutzen, and by Goddard, C.J. in Brend v. Wood. Wright, J. expressed the rule in these words: 'There is a presumption that mens rea an evil intention, or knowledge of the wrongfulness of the act, is an essential ingredient of every offence, but that presumption is liable to be displaced either by the words of the statute creating the offence or by the subject-matter with which it deals and both must be considered.' And, the formulation by Goddard, C.J. is to the following effect: 'It is of the utmost importance for the protection of the liberty of the subject that a court should always bear in mind that unless a statute either clearly or by necessary implication rules out mens rea as a constituent part of a crime a defendant should not be found guilty of an offence against the criminal law unless he has got a guilty mind.' It has also been said that the presumption of existence of mens rea is ' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erriding the advice of his subordinates, which has a financial implication of ₹ 1.86 crores for the government was sufficient in itself to characterize the said action as an abuse of official position for the purposes of section 13(1)(d)(ii) and as being without public interest for the purpose of Section 13(1)(d)(iii) of the PC Act. The questions that arise in this context are in a government run essentially by an Executive with a Minister heading a Department, and where decisions involving financial implications are taken routinely, when can a decision be said to constitute an abuse of official position What can be said to be a decision that is not in 'public interest'? 34. The importance of the above questions becomes apparent on a comparison of the earlier provision i.e. Section 5(1) (d) PC Act, 1947 with Sections 13(1)(d) (i), (ii) and (iii) of the PC Act 1988: Section 5(1)(d) PC Act, 1947 5. Criminal Misconduct Section 13(1)(d) (i),(ii) and (iii) PC Act, 1988 13. Criminal misconduct by a public servant (1) A public servant is said to commit the offence of criminal misconduct- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in any of the cases cited at the bar particularly in the context of the PC Act 1988. There is no authoritative pronouncement on the above aspects of the law. Given the importance of the questions and the implications it has for numerous other cases that may be pending at various stages, it is considered appropriate to direct that these appeals should be decided by a larger bench of two Hon'ble judges. It is clarified that the submissions of the counsel for the parties on the evidence in the case and the correctness of the findings of the trial court have not been discussed in this order. Those will also have to be examined notwithstanding the answers to the above questions. The appeals may be placed on 9th October 2009 before the appropriate Division Bench subject to the directions of Hon'ble the Chief Justice. S. MURALIDHAR, J. SEPTEMBER 24, 2009 The Facts 3. Mr. Sukh Ram was the Union Minister of State for Communications [MoS (C)] with independent charge for the period of 18th January 1993 to 16th May 1996. Ms. Runu Ghosh was the Director (FA-V) in the Department of Telecommunications (DoT) at that time. Mr. P. Rama Rao was the Managing Director of Advanced ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Radio System, which explained its advantages over the crystal based system. Pending the finalization of the award of contract pursuant to the tender of 13th January 1992, a provisional purchase order (PO) dated 31st December 1992 for supply of 300 systems of 2/15 MARR was placed by the DoT on M/s. ARM. A similar order for 200 systems was placed on M/s. Shyam. 7. The Union Budget was announced and on 16.04.1993, M/s. ARM wrote a letter to the Member (Production) (i.e. Member of the Telecom Commissioner) DoT (marked Ex. PW-3/K14 during the trial) informing him inter alia that due to Budget concessions, it was able to lower the price of the system: due to various duty concessions given by the Government and quality measures successfully adopted by us, we could bring down the price of each 2/15 MARR Shared Radio Systems from ₹ 3,54,500 to ₹ 3,45,000 passing on a net benefit of ₹ 9,500 to DoT. M/s. ARM further informed DoT that the above benefit of ₹ 9,500 would apply to our synthesized version of 2/15 also. 8. The Director (MMC), Mr. Ujjagar Singh, prepared a note dated 26.04.1993 proposing to procure 2500 systems from the vendors having type a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es with those of the synthesized version, Ms. Runu Ghosh was of the view that these aspects were not discussed at the meeting but on the other hand, the facts appeared to have been gathered subsequently. She accordingly declined to sign the minutes of the PNC. In the report, marked as Ex. PW 3/K35, the PNC recommended price of ₹ 3,40,750/- per system together with one duplicate unit each of LNA and Power supply, for synthesized version of 2/15 MARR system. The report observed that crystal based systems were inferior (to the synthesized version) and suffered from serious limitations of delay in dial tone during installation or replacement of RSU unit, which might involve to and fro visits between RSU and BSU, which was not so in the synthesized version. The report also stated that the crystal version did not have the facility of changing subscriber units identification code and therefore needed stocking of comparatively large quantities of spare units and parts for maintenance with added resultant cost. The Committee therefore recommended that crystal version should be bought for a further discounted price. PW-3 Sri N.C. Gupta by a detailed note dated 13th July 1993 proposed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aced. 12. On 26th July 1993 Sri Rakesh Aggarwal, the Director (TR) and the Member of the Technical Group of the TEC, wrote to Ms. Runu Ghosh confirming that the design, concept and application of hand held VHF trans receivers are entirely different from 2/15 MARR and is not proper to compare. (Ex. PW-D2-2). As regards cost comparison between the crystal versions with that of the synthesized version, he stated that the TEC did not have any data on costing. However, this depended upon the design, concept types of components used and is not susceptible to cost comparison as is being attempted. Meanwhile, the file traveled from desk to desk. The Adviser (P) who saw it next agreed with the suggestion of Sri N.C. Gupta that the price should be reduced by ₹ 37,170 per system (Ex. PW-3/K-40). The file was sent to the office of Mr. Sukh Ram, who had asked for it, on 23.07.1993. It was returned, since he was pre-occupied with other work, on 02.08.1993 (note exhibited as Ex. PW3/K-44). It was requisitioned and submitted to the minister, by Ms. Runu Ghosh, on 05.08.1993 (note exhibited as Ex. PW-3/K-45). 13. The file was placed before Mr. Sukh Ram, the MoS (C), on 15th Augu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; 30,000/- as additional spare units. The DoT, however, did not agree. By its letter dated 17th September 1993 (Ex. PW3/K-102) it informed M/s. ARM to give a clear acceptance of the APO within the time frame indicated otherwise it would reserve the right to procure the item of the synthesized version from any of the sources available to DoT. On 20th September 1993 M/s. ARM wrote to the DoT (Ex. PW-3/K-100) furnishing a bank guarantee for 300 crystal systems for the reduced price. 15. On 11.09.1993 M/s. ARM made a detailed representation to the Minister, Mr. Sukh Ram (Ex. PW-3/K-76) requesting amendments to the APO as regards (a) enhancement of quantity of order for crystal controlled version of 2/15 from 300 to 450 systems; (b) 2) equalization of price of crystal version with that of the synthesized version; (c) Since requirement of spares was not spelt out in the NIT it was to be deleted; (d) Treatment of sales tax, as excluded from the basic price of the system and be treated extra as other statutory levies like excise duty. On the representation of 11.09.1993 the MoS (C) Mr. Sukh Ram, made the following noting (Ex. PW-3/K-77) by hand: How are we offering two rates a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in view of the perceived inferiority of the crystal version it would be necessary to make suitable adjustment in the prices though crystal controlled 2/15 MARR systems of M/s. ARM were stated to fully meet DoT specifications and these systems are working satisfactorily in the field. The note also suggested that the Chief/Sr. Cost Accounts Officer of the Ministry of Finance assisted by a representative of the Member (Services) and/or Member (Technology) should undertake a quick study of the relative merits of the 2 sets as well as their costs. 18. The matter was again placed before the MoS (C), Mr. Sukh Ram who on 13.12.1993 reiterated (by note Ex. PW-3/K-89) his earlier view. He pointed out that in view of the observations of the TEC, the basic premises for cost reduction for crystal versions were wrong and we should not persistently repeat that a crystal version is inferior and therefore, its cost should be less than that of synthesized version. He further wrote that the perceived inferiority was merely a matter of opinion of one or two officers and unsubstantiated by any comparative data in the actual working of crystal and synthesized version in the field. This note ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the impugned judgment and order, the Trial Court held the Appellants guilty of the offences in the manner described above. The Court held that the entire conspectus of circumstances proved that the Tender Notice had clearly indicated that the preferred product of procurement was the synthesized version, which despite availability, was not sought to be purchased. Though the order placed for the first 500 included some versions of the crystal type, by the time the rest of the order could in fact materialize, the Department had the option to procure the preferred technology. Ms. Runu Ghosh's notes questioning the action of senior officers in regard to the costing of the crystal version, despite overwhelming opinion of all officials with technical expertise, her correspondence with ARM, the manner in which she advocated its cause, and the recovery of ARM's signed and blank letterheads from her official desk, proved her prominent role in the ultimate price reduction ordered by Mr. Sukh Ram, in November, 1993. As regards Mr. Sukh Ram, the Court, after considering all the nothings, and in particular his observations on 15.08.1993 and 31.08.1993, held that after approving the pri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... personal influence, any public servant to do any of the things mentioned in the previous things, and makes such acts or omission, punishable. Section 10 punishes the crime of abetment by anyone, of the offences in Sections 8 or 9. Section 13, which is material for the purposes of this judgment, reads as follows: 13. Criminal misconduct by a public servant.-(1) A public servant is said to commit the offence of criminal misconduct,- (a) if he habitually accepts or obtains or agrees to accept or attempts to obtain from any person for himself or for any other person any gratification other than legal remuneration as a motive or reward such as is mentioned in Section 7; or (b) if he habitually accepts or obtains or agrees to accept or attempts to obtain for himself or for any other person, any valuable thing without consideration or for a consideration which he knows to be inadequate from any person whom he knows to have been, or to be, or to be likely to be concerned in any proceeding or business transacted or about to be transacted by him, or having any connection with the official functions of himself or of any public servant to whom he is subordinate, or from any person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting on this, counsel urged that the charge framed was that the public servants acted against the advice of the officials, resulting in pecuniary advantage to the extent of ₹ 1.68 crores to ARM. The charge nowhere reflected the elements of obtaining pecuniary advantage, to a third party without public interest . The omission of these from the charges framed, prejudiced the trial, and consequently, urged counsel, the impugned judgment was liable to be set aside. Reliance was placed on judgment in Nanak Chand v. State of Punjab AIR 1955 SC 274. The omission to state the necessary ingredients and the supporting facts, in the submission of counsel, contravened Sections 212 and 213, Cr. P.C, which were incurable. Relying on the decision reported as Chittaranjan Das v. State of WB AIR 1963 SC 1696, it was urged the trial and conviction were vitiated. 25. It was argued next, by counsel for all the Appellants that mens rea, or criminal intent, has to be construed as an integral part of Section 13(1)(d)(iii). In support of the submission, it was urged that mens rea is implicit in the entire provision, as is evident from the use of expressions such as habitual acceptance of gra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st not strain the words on any notion that there has been a slip, that there has been a casus omissus, that the thing is so clearly within the mischief that it must have been intended to be included if thought of. On the other hand, the person charged has a right to say that the thing charged although within the words, is not within the spirit of the enactment. But where the thing is brought within the words and within the spirit, there a penal enactment is to be construed, like any other instrument, according to the fair common sense meaning of the language used, and the Court is not to find or make any doubt or ambiguity in the language of a penal statute, where such doubt or ambiguity would clearly not be found or made in the same language in any other instrument. In our view this passage, if we may say so, restates the rule of construction of a penal provision from a correct perspective. As we will presently show the case of the appellant on the facts found clearly falls not only within the words of clause (d) but also within its spirit. Indeed if his argument be accepted not only we will be doing violence to the language but also to the spirit of the enactment. First takin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h case, he obtains a pecuniary advantage by abusing his position as a public servant. The word obtains is used in Sections 161 and 165 of the Penal Code. The other words corrupt or illegal means find place in Section 162. Apart from corrupt and illegal means , we have also the words or by otherwise abusing his position as a public servant . If a man obtains a pecuniary advantage by the abuse of his position, he will be guilty under sub clause (d). Sections 161, 162 and 163 refer to a motive or a reward for doing or forbearing to do something, showing favor or disfavor to any person, or for inducing such conduct by the exercise of personal influence. It is not necessary for an offence under clause (d) to prove all this. It is enough if by abusing his position as a public servant a man obtains for himself any pecuniary advantage, entirely irrespective of motive or reward for showing favor or disfavor. To a certain extent the ingredients of the two offences are common, no doubt. 28. Reliance was particularly placed on the following observations in Major S.K. Kale v. State of Maharashtra, (1977) 2 SCC 394, to say that the burden lay upon the prosecution to prove dishonest o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns or by abuse of office, or obtaining for someone else, a valuable thing, or pecuniary advantage, with loss to public interest. Counsel submitted that the prosecution in this case did not prove that the crystal version, procurement of which was approved, -a fact not disputed-either caused pecuniary advantage of such a kind to ARM as to make the said two Appellants criminally responsible, nor loss to public interest. In this context, it was submitted that often public servants, including officers and ministers, are called upon to take decisions which are not popular, or are unpalatable. Such decisions cannot ipso facto result in prosecution, unless the mental element of dishonesty, to cause advantage (of an unwarranted variety) to another, and loss to the public interest is proved. Counsel relied on the following observations of the Supreme Court in Tarlochan Dev Sharma v. State of Punjab, (2001) 6 SCC 260: An honest though erroneous exercise of power or an indecision is not an abuse of power. A decision, action or instruction may be inconvenient or unpalatable to the person affected but it would not be an abuse of power. It must be such an abuse of power which would rende ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he procuring department. It was pointed out that the letter to the bidders was issued on 07.06.1993 (Ext. PW3/K-26). PW-4 N.C. Gupta stated in his cross-examination that the PNC met once before actual negotiation; however that is not borne out by the record. The decision on the file by higher authorities was to negotiate only with M/s ARM who was the lowest bidder. The decision to call 3 bidders was taken only by Sri N.C. Gupta and Sri Ujjagar Singh. It was further argued that there was no discussion about crystal and synthesized versions in the PNC (which was indeed outside their terms of reference) as pointed out in Ms. Ghosh's penciled note sent to Sri N.C. Gupta. At no stage, in the file was this observation contradicted by Sri. N.C. Gupta, or PW-3 Sri Ujjagar Singh. It was urged that the PNC was not competent to say which version was better - in fact that was outside their terms of reference. 33. Counsel for Mr. Sukh Ram and Ms. Runu Ghosh argued that the T.E.C had drawn up specifications and issued type approval for both crystal and synthesized versions, and that without type approval no one could supply any equipment to the DoT. Further, submitted counsel, the extensi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deficiency or defect, or variation between the conditions of NIT was noticed or felt, and everyone in the DoT - including PW-3 Sri Ujjagar Singh, as well as PW-4 Sri N.C. Gupta - were satisfied on due consideration of all materials that the order for the crystal version complied with the requirements. In the light of these facts, there was no occasion for anyone to re-visit the issue, and the only reason for fresh thinking was because of the price reduction offered by ARM on account of customs duty relief announced in the new Budget. 35. It was also urged that neither the PNC terms, nor the intimation to manufacturers, inviting them to meet the PNC, in June, 1993, indicated that the members would consider the relative technical merits or even the pricing of the two products. No prosecution witness indicated that there was any discussion about the technical reasons for superiority of the synthesized technology, as compared with the crystal version. On the other hand, submitted counsel, Sri Rakesh Agarwal and Sri Muthuswamy were not examined, to establish the superiority of the synthesized version over the crystal version. What the court had before it, was the evidence of DW-2, wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the crystal version. If that were really the position, he could not explain why the crystal version passed muster, when the first order was placed on ARM in December 1992, for 500 pieces. Furthermore, argued counsel, the witness admitted ignorance about the procedures and manuals governing the question of equipment testing and procurement procedures applicable to the DoT. 38. Counsel urged that after ARM offered reduction in price, and the file was sent to Ms. Runu Ghosh, she proposed award of contract for 1500 units to the concern (by note 37/N, Ex. PW-3/K-19, on 25.05.1993). When the file went to PW-3, Sri Ujjagar Singh, he merely mentioned about the need to have a PNC, and nowhere discussed the so called inferiority of the crystal technology or the need for further price reduction of that product, in Ex. PW-3/K-21. The understanding at that stage was to award the bulk of the order to ARM, as reflected in the note of Sri U.S. Naik, (Ex. PW-3/K-24) that 1000 units should be procured from that concern. In the light of these, the potential vendors, i.e. ARM, Punwire and Shyam, were given letters/ notices to make their offers, which were produced during the trial as Ex. PW-3/K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of 17.8.1993 proposed for orders on Natelco saying they had the synthesized version, whereas Natelco's letter to MOS (C) informing the DoT regarding type approval has been marked by M(P) to DDG (1) on 16.08.1993. It, was therefore, not possible for the letter to have reached Mr. Ujjagar Singh on 17.08.1993 when he wrote the note. Therefore, urged counsel, the letter must have been hand delivered or faxed, as was apparently the practice. In the circumstances, the Court ought not to have held that Ms. Ghosh wrote notes unilaterally based on letters written directly to her, by ARM. 41. Ms. Runu Ghosh challenged the Trial Court's finding that it is not borne out that the synthesized version of ARM had some additional features since Rakesh Aggarwal did not specifically say so. He deposed that each system (including ARM's Synthesized version) might have additional features not covered by specifications; in her letter to TEC. Ms. Ghosh had asked about additional features in synthesized versions of all bidders, not only of ARM. There was no independent assertion by her that M/s ARM's synthesized version had additional features; she repeated the information given by TEC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... changes were made by him by way of deducting 200 systems from PUNWIRE and allotting 100 each to M/s Shyam and M/s ARM. Significantly 100 systems were given to ARM of the synthesized version. It was argued that if he had been in conspiracy with ARM, or wanted to confer pecuniary advantage to that firm, he would have allotted all the 200 systems to ARM for the crystal version. He had occasion to consider the file and other documents, after the orders were placed, and in the context of ARM's representation to do away with the discriminatory pricing vis- -vis their crystal versions. At the time, Mr. Sukh Ram was unaware and was kept in the dark about the circumstance that the firm had accepted the offer, and furnished the bank guarantee. Counsel for Mr. Sukh Ram submitted that the handwritten portions in Sri Ujjagar Singh's note of 04.10.1993 Ex. PW-3/K-79 were inserted later, contrary to previous practice. That the learned Judge ought to have appreciated that each circumstance must be established fully and it can be nobody's case that the minister had the knowledge about the factum of bank guarantee through hastily scribbled handwritten lines in a note which was actually ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estion of cost determination would come. As rightly mentioned by Hon'ble MOS (C), the TEC has clearly mentioned that hand-held VHF trans-receivers are completely different from our 2/15 MARR systems in respect of design, concept and even application. Reduction worked out on the basis of difference in the price of crystal and synthesized version of hand held VHF transreceivers may not, therefore, be correct. However, in view of the observations of Member (Services) and member (Technology) as mentioned in para 4 above, suitable adjustment in the prices on account of the perceived inferiority of the crystal version would appear to be necessary even though crystal controlled 2/15 systems of M/s ARM are stated to fully meet DoT specifications and these systems are working satisfactorily in the field. 45. Sri Nigam urged that Mr. Sukh Ram, while deciding that the crystal version should be purchased at a rate on par with the synthesized version was guided by the report of TEC dated 26.07.1993. The latter was the apex body on matters concerning technology. Mr. Sukh Ram was justified in relying on it for his decision than the opinion of one officer namely N.C. Gupta. It was urged tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the quantity mentioned, for the same price as the synthesized version. It was submitted that the later note dated 12.01.1994 (Ex. PW-3/K-93) of Sri Vittal after he again discussed the matter with Mr. Sukh Ram did not in any way differ from the earlier view. 48. Counsel for Mr. Sukh Ram argued that the conviction of conspiracy as far as the Appellant is concerned, is totally unjustified. The record and findings reveal that ARM made its representation on 11.09.1993, which he was bound to consider and dispose of. He was unaware, at that stage that the firm had been asked to furnish the bank guarantee for 5% of the Purchase Order amount; he was also not made aware of it in any specific file noting in that regard. The Trial Court's findings (that Ujjagar Singh's note of 04.10.1993, with the handwritten interpolation pointed to this fact, was not correct; the interpolation was apparently especially for the purpose of this case) in this regard were unjustified. It was urged that to establish conspiracy, for the purpose of drawing inferences based on Section 10 Evidence Act, the mere circumstance that the act by one would have led to another's benefit (in the context of this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies as Director Finance. Furthermore, nothing was shown during the course of the trial to prove that she flouted established procedures in insisting on TEC evaluation of the merits of the two technologies either for comparison, or for the purpose of price determination. The last time she made any noting or recommendation was on 23.07.1993. The hierarchy had three levels of senior officers, who took the ultimate decision. In these circumstances, there was no reasonable basis even to assume, or charge her for the crime of conspiracy. 49. Mr. Nigam, on behalf of Mr. Sukh Ram, argued that there was no prima facie evidence to reasonably conclude that he acted in furtherance of any conspiracy or common objective with either Ms. Runu Ghosh or Mr. Rama Rao. Counsel argued that the check period in this case, covered March 1993 onwards, when Mr. Sukh Ram was not even in the know of the file. It was submitted that his note of 31.08.1993 established that on the other hand, he concurred with all other officers, on the basis of which the price differential was worked out; in fact his decision formed the basis of the purchase order issued to various vendors. Counsel contested the Trial Court&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sses of the Government; all vendors who had offered their products, and fulfilled certain criteria, were called for price negotiation. In the price negotiation, held in June, 1993 none of the firms were in fact queried on the superiority of one technology over the other; nor were they told that the entire process would be followed by the DoT's fresh determination of prices, based on perceived comparative merits. Thus, when the Purchase Order was issued in early September, 1993, ARM, for the first time, became aware of this aspect. The Government's insistence that if it did not accept the offer, and furnish a bank guarantee, would result in cancellation of order, and a claim for liquidated damages, left it with no option but to comply. Yet, in exercise of its legitimate entitlement to seek internal justice, ARM represented to the appropriate authorities and the Minister, eliciting his second look into the matter, and review of the original decision, on 19.11.1993. None of these pointed to any reasonable basis to even lead to suspicion of conspiracy, let alone strong suspicion. Thus, prosecution and conviction of Mr. Rama Rao were contrary to law, and contrary to established ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e remedies, during the trial, to ensure that the guilty are brought to book, the Act had to be necessarily given a purpose or objective based interpretation, having regard to its express words. The courts cannot adopt a doctrinaire approach, by insisting that proof of intent, where the law does not mandate it, is required, as that would result in limiting the scope, of the concerned provision, if not altogether defeating it. In a similar vein, reliance was placed on the judgments reported as Dineshchandra Jamnadas Gandhi v. State of Gujarat 1989 (1) SCC 420 and Radhey Shyam Khemka v. State of Bihar 1993 (3) SCC 54, Y.S. Parmar v. Sri. Hira Sikngh Paul 1959 Supp (1) SCR 213 and Gopaldas Udhavdas Ahuja v. Union of India 2004 (7) SCC 33. The learned ASG submitted that the statute in the case, at least of a corrupt practice of the kind in hand, does not concern itself with any question of intention. 53. Dealing with the submission about omission to frame charges, it was argued that by virtue of Section 464, Cr.PC, unless the Appellant, or Revisionist, before a higher court, proves that the conviction would result in failure of justice, any irregularity in the framing of charge would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... file was not sent to DDG (DF). The file containing this note was directly sent to MoS the same day. The note of PS to MoS regarding return of file to Ms. Runu Ghosh as he was preoccupied and could not see the file, along with the file was received by Ms. Runu Ghosh on 3rd August, 1993. The file was intentionally kept by her for two days which were working days, i.e. 3rd and 4th August, 1993 so that her senior could not see the note made by her. The file was resubmitted as desired by MoS on 5th August, 1993. PW 16 Sri US Prasad, DDG (PF) who was Ms. Runu Ghosh's immediate senior deposed that the movement of file was that the junior would submit the file to his next superior and on return the file would be marked to his immediate junior. It was also urged that the noting of 23rd July, 1993 mentioning additional features in the ARM's synthesized version, also showed Ms. Runu Ghosh's intention to favor that concern, because by then, no such additional features had been claimed by ARM. 56. The ASG urged that Ujjagar Singh, Director (MMC) recorded a typed note dated 19th of July, 1993 and sent it to Dilip Sahay, DDG (MMI). He sent the file to DDG (PF) on the same day. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment. It is urged that in fact there was no new material before Mr. Sukh Ram to change his previous views, contained in the note dated 31st August, 1993, (by which he had accepted the price differential for the two products) as it was clear that the letter of Rakesh Aggarwal dated 26th of July, 1993 was on the file, prior to note dated 31st of August, 1993 as well as an unsigned note which talked about the said TEC letter and was seen by Mr. Sukh Ram in August, 1993 itself. 58. It was next argued that pursuant to the note of Mr. Sukh Ram, dated 19th of November, 1993, U.S. Prasad, DDG (PF) proposed an alternative (note dated 09.12.1993, Ex. PW-3/K-87) to work out the reduction of cost of the crystal version, which could be fair to the firm as well as the department. He proposed to seek assistance from Secretary (Expenditure) to direct Chief/ Sr. Cost Accounts Officer of the Main Ministry of the Finance assisted by the representative of the member (Services) and/or Member (Technology) to undertake a quick study of the relative merits of the two sets as well as their costs. In view of the huge financial implications amounting to ₹ 1.62 crores, the MoS (C) was requested to re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his costing, by Ex. PW 3/K-41. It was argued that the nothings of Sri M.G. Kulkarni, Sri R.G. Bansal, and Sri Rastogi, on separate occasions (by Ex. PW 3/K-50, by Ex. PW 3/K51, by Ex. PW 3/K-52 and by Ex. PW 3/K-59) made it amply clear that these high ranking technical officers, holding positions of Members of the Telecom Commission, concurred with the price differential proposed by Sri N.C. Gupta, in Ex. PW 3/K-39. Mr. Sukh Ram had occasion to see this not once, but three separate times; after due deliberation and application of mind, he approved the price differential, on 31.08.1993, by Ex. PW 3/K-60. The deliberation and application of mind, was apparent, from the specific quantities, pertaining to ARM-his note said clearly that the firm was to receive order to supply 300 crystal systems, and 600 synthesized systems. He could also not be said to be unaware about the price differential, since he said that he had perused the preceding note . The note further said that two firms, Natelco and Punwire had to be proven in the field. These clarified that the Minister was aware of all aspects, including the debate vis a vis the claims of superiority of the synthesized version, and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rantees, thus accepting the offer unconditionally. The alteration of the price, post acceptance of the offer, was to the detriment of the Government, which had to shell out huge amounts to ARM. This reversal of the previous decision was completely unreasonable, and not justified by any reason, except to favor ARM, at its behest. Therefore, Mr. Sukh Ram too was a conspirator, and equally culpable. Analysis of the provisions 62. It would be, necessary, before proceeding to analyze and record the findings, to discuss two legal issues which arise for consideration. The first pertains to whether the failure of the Trial Court, in not specifically mentioning certain details in the charges framed, against each accused, (as it did not advert to the offence under Section 13(1)(d)(iii)), or the ingredients of the offence, i.e. obtaining by someone of a valuable thing, contrary to public interest, vitiated the trial. The second pertains to the true interpretation of Section 13(1)(d)(iii) of the Act and whether for recording a conviction, it is necessary to prove mens rea, or criminal intent, on the part of the accused. Effect of failure to mention provisions and precise amounts in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... If he does, if he is tried by a competent court, if he is told and clearly understands the nature of the offence for which he is being tried, if the case against him is fully and fairly explained to him and he is afforded a full and fair opportunity of defending himself, then, provided there is substantial compliance with the outward forms of the law, mere mistakes in procedure, mere inconsequential errors and omissions in the trial are regarded as venal by the Code and the trial is not vitiated unless the accused can show substantial prejudice. xxxxxxxxx xxxxxxxxx xxxxxxxxx But when all is said and done, what we are concerned to see is whether the accused had a fair trial, whether he knew what he was being tried for, whether the main facts sought to be established against him were explained to him fairly and clearly and whether he was given a full and fair chance to defend himself. If all these elements are there and no prejudice is shown the conviction must stand whatever the irregularities whether traceable to the charge or to a want of one. It is immaterial whether the charge was framed properly or not; what matters is whether the error, omission or irregularity oc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (d) of subs.(1) of S. 5, have been set out in the charge. We are satisfied that there has been no prejudice to the accused, by the mere non-mention of the specific clauses of sub-s.(1) of S. 5 in the charge. For these reasons, this Court is of opinion that the omission to mention certain details, or omission to mention the ingredients of the offence or some of the words in the provisions, or omission to outline the provision cannot be considered fatal; there was a reference to Section 13(1)(d), and the general facts relating to the charges were narrated. This question is therefore, answered in the negative; there was no failure of justice, or prejudice to the Appellants flowing from omission in the framing of charges. Interpretation of Section 13(1)(d) (ii) and (iii) 66. This question lies at the core of the reference to this Division Bench. The material portion of the reference, while adverting to Sections 13(1)(d) and then dealing with the phraseology of Section 13(1)(d)(iii) and other preceding sub clauses, reads thus: Whether the absence of adverbs like willfully , fraudulently , dishonestly , corrupt or illegal means to qualify the verb obtains in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erest There is no doubt that Parliament created this new offence of criminal misconduct, where abuse of office, or use of corrupt or illegal means by a public officer, is inessential to prove the crime. What the prosecution has to establish, in accordance with law, is that the public officer, obtained for someone else - not necessarily by abusing his office, or using corrupt or illegal means - pecuniary advantage or a valuable thing - without public interest. 67. It is not as if Parliament had changed the law, for the first time. The legislative history of Section 5 would reveal that it was amended repeatedly. The first amendment, in 1952, introduced Section 5 (4) which clarified that the provision was in addition to, and not in derogation of any other existing law; the second amendment substituted Section 5(2) which provided for a minimum sentence; it also introduced sub-section (2-A). The third amendment, brought about in 1964, introduced a significant change; the controlling expression, or the opening phrase defining criminal misconduct, under Section 5 when the Act was introduced, and till its amendment in 1964, was a public servant is said to commit the offence of crimin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equently, it is proposed to delete those sections with the necessary saving provision. 5. The notes on clauses explain in detail the provisions of the Bill. 69. The reference order relies on various materials, such as G.P. Singh's Principles of Interpretation of Statutes, (9th edition, pp.779-780). The passage extracted referred to the judgment of Lord Goddard, in Brend v. Wood (1946) 62 T.L.R. 462 to the effect that mens rea must be inferred in every penal statute if it does not expressly provide it, unless it is ruled out by necessary implication. The passage is as follows: It is in my opinion the utmost importance for the protection of the liberty of the subject that a court should always bear in mind that, unless the statute, either clearly or by necessary implication, rules out mens rea as a constituent part of a crime, a defendant should not be found guilty of an offence against the criminal law unless he has got a guilty mind. Counsel for the Appellants had relied on the decisions in M. Narayanan Nambiar v. State of Kerala, 1963 Supp (2) SCR 724; Soma Chakravarthy v. State 2007 (5) SCC 403; Ram Krishan v. State of Delhi, 1956 SCR 182; Major S.K. Kale v. Sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ething for which it is not intended. That abuse may be by corrupt or illegal means or otherwise than those means. The word otherwise has wide connotation and if no limitation is placed on it, the words corrupt , illegal , and otherwise mentioned in the clause become surplus age, for on that construction every abuse of position is gathered by the clause. So some limitation will have to be put on that word and that limitation is that it takes color from the preceding words along with which it appears in the clause, that is to say something savoring of dishonest act on his part.... Similarly, the other cases cited, i.e. S.P. Bhatnagar ( whether the accused abused their position and acted dishonestly or with a corrupt or oblique motive ) Abdulla Mohammed (supra); A. Wati Ao; C.K. Damodaran Nair; M. Mohiuddin and R. Balakrishna Pillai (supra) support this view. In the last decision, it was held that the offence requires intention, and the offence comprehended an element of mental state would be necessary to do a conscious act to get the required result of pecuniary advantage or to obtain any valuable thing, even if it is for someone else.. 71. The question is, wheth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aken into account, along with the legislative history (of Section 5 of the earlier Act, with its amendments, and the new Section 13(1)(d) re-cast in a totally different manner) -it appears immediately after another offence of criminal misconduct (Section 13(1)(d)(iii)) that does not textually allude to or require intent, or mens rea. 72. A multitude of precedents was relied upon by Counsel on either side, to deal with the question. The Supreme Court, noticing most of the earlier decisions, on the issue, and also the approach adopted by Courts in England, said, in Nathulal v. State of M.P., AIR 1966 SC 43 that: ....it is a sound rule of construction adopted in England and also accepted in India to construe a statutory provision creating an offence in conformity with the common law rather than against it unless the statute expressly or by necessary implication excluded mens rea. The mere fact that the object of the statute is to promote welfare activities or to eradicate a grave social evil is by itself not decisive of the question whether the element of guilty mind is excluded from the ingredients of an offence. Mens rea by necessary implication may be excluded from a statute ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is one instance where the object of the enactment, the purpose which it seeks to achieve, and the prevailing social evil which is sought to be erased become important. In this context, the need for such purposive approach, rather than adopting a liberal approach, based on the doctrine that every offence carries within it the presumption that mens rea is a necessary ingredient, was emphasized in his inimitable style by Krishna Iyer, J, in Murlidhar Meghraj Loya v. State of Maharashtra, (1976) 3 SCC 684: the Supreme Court observed: It is trite that the social mission of Food Laws should inform the interpretative process so that the legal blow may fall on every adulterator. Any narrow and pedantic, literal and lexical construction likely to leave loopholes for this dangerous criminal tribe to sneak out of the meshes of law should be discouraged. For the new criminal jurisprudence must depart from the old canons, which make indulgent presumptions and favored constructions benefiting accused persons and defeating criminal statutes calculated to protect the public health and the nation's wealth. More than a decade later, similar views were echoed - this time by Venkatachala ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all classes of statutes, so that all statutes, whether penal or not, are now construed by substantially the same rules. ... They are construed now with reference to the true meaning and real intention of the legislature. At p. 532 of the same book, observations of Sedgwick are quoted as under: The more correct version of the doctrine appears to be that statutes of this class are to be fairly construed and faithfully applied according to the intent of the legislature, without unwarrantable severity on the one hand or unjustifiable lenity on the other, in cases of doubt the courts inclining to mercy. 73. Having regard to the previous history of the statute, the amendments to the 1947 Act, its avowed objects and the distinctive structure which Parliament adopted consciously, under the 1988 Act, despite being aware of the pre-existing law, as well as the decisions of the Court-the conclusion which this Court draws is that mens rea is inessential to convict an accused for the offence under Section 13(1)(d)(iii). It would be sufficient if the prosecution proves that the public servant obtains by his act, pecuniary advantage or valuable thing, to another, without public inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be relegated to adjudication of their rights by resort to remedies provided for adjudication of purely contractual disputes...To this extent, the obligation is of a public character invariably in every case irrespective of there being any other right or obligation in addition thereto. An additional contractual obligation cannot divest the claimant of the guarantee under Article 14 of non-arbitrariness at the hands of the State in any of its actions. In a later decision, LIC of India v. Consumer Education Research Centre, (1995) 5 SCC 482, it was held that: public authorities or those whose acts bear insignia of public element, action to public duty or obligation are enjoined to act in a manner i.e. fair, just and equitable, after taking objectively all the relevant options into consideration and in a manner that is reasonable, relevant and germane to effectuate the purpose for public good and in general public interest and it must not take any irrelevant or irrational factors into consideration or appear arbitrary in its decision. A recent judgment, has examined the concept, in NOIDA Entrepreneurs Association v. NOIDA, (2011) 6 SCC 508, in the light of provisions of Se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er the State (a compendious term) are equally bound by such a condition. To ensure that they are afforded the amulet protection and immunity, the Constitution has mandated some safeguards (in the case of members of a service or holders of office under a State or the Union, the protection from arbitrary loss of employment, under Article 311, and the protection of status accorded by virtue of rules or enactments made, pursuant to Article 309 of the Constitution of India). There is an added layer of immunity in the form of requirement of sanction under Section 197 or other similar provisions, to protect public servants from needless harassment. However, when the public servant acts in a manner that is devoid of public interest, not only would the action become suspect, then, having regard to the nature of his action, and the heightened degree of blameworthiness, he is said to have transgressed the bounds of protection afforded to his decisions, and is then exposed to prosecution. 76. From a different perspective, all public office and all State power - even in the contractual sphere (Articles 298 and 300 of the Constitution) should be exercised for the people's benefit. A publi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e judged, if mens rea (to obtain pecuniary advantage or valuable thing to another) is not a necessary ingredient. This exercise is essential because in the absence of mens rea (which has been ruled out) the court has to say what acts resulting in someone obtaining pecuniary advantage or valuable thing are without public interest . Obviously the mere fact that a third party obtains pecuniary advantage, or a valuable thing, is insufficient; a supplier of equipment to public servants or offices, a travel agent who makes bookings for a public agency, a businessman or corporate group granted licenses or clearances, by departments or agencies of the Government, would all stand to benefit. Many of these decisions are in fact, and all are, expected to be in public interest. Therefore, the kind of behavior which amounts to an act resulting in someone obtaining pecuniary advantage or valuable thing without public interest needs to be spelt out. 78. In a previous part of this judgment, what constitutes public interest and the trust element, which informs every decision of a public servant or agency, was discussed and emphasized. The State in its myriad functions enters into co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eguards, and exercised all reasonable precautions having regard to the circumstances, despite which there was loss of public interest, he would not be guilty of the offence. The provision aims at ensuring efficiency, and responsible behavior, as much as it seeks to outlaw irresponsibility in public servant's functioning which would otherwise go unpunished. The blameworthiness for a completely indefensible act of a public servant, is to be of such degree that it is something that no reasonable man would have done, if he were placed in that position, having regard to all the circumstances. It is not merely a case of making a wrong choice; the decision should be one such as no one would have taken. 80. In this context, it would be useful to notice the following passage from the work Errors, Medicine and the Law by Alan Merry and Alexander McCall Smith: Criminal punishment carries substantial moral overtones. The doctrine of strict liability allows for criminal conviction in the absence of moral blameworthiness only in very limited circumstances. Conviction of any substantial criminal offence requires that the accused person should have acted with a morally blameworthy state ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be without public interest, as the potential benefit from competitive bids would be eliminated. Likewise, tweaking tender criteria, to ensure that only a few applicants are eligible, and ensure that competition (to them) is severely curtailed, or eliminated altogether, thus stifling other lines of equipment supply, or banking on only one life saving drug supplier, who with known inefficient record, and who has a history of supplying sub-standard drugs, would be acts contrary to public interest. In all cases, it can be said that the public servant who took the decision, did so by manifestly failing to exercise reasonable proper care and precaution to guard against injury to public interest, which he was bound, at all times to do. The intention or desire to cause the consequence may or may not be present; indeed it is irrelevant; as long as the decision was taken, which could not be termed by any yardstick, a reasonable one, but based on a complete or disregard of the consequence, the act would be culpable. 83. The test this Court has indicated is neither doctrinaire, nor vague; it is rooted in the Indian legal system. A public servant acts without public interest, when his decis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is was at the rate offered by Indotronix, i.e. ₹ 3,54,500/- per unit. This decision was taken on 27.11.1992. By then, M/s Shyam Telecom obtained type approval for the, i.e., the synthesized version, on 25.11.1992. This was taken into consideration, and the decision to place an order for 500 units was changed; ARM was asked to supply 300 units (of its crystal version) and Shyam was given the order to supply 200 units of its synthesized version. The price at which both concerns were given the orders was the same, i.e. ₹ 3,54,500/- per unit. On 16.04.1993, through its letter Ex. PW-3/K14 ARM, as a result of Union Budget concessions, offered to lower the unit price of the product from ₹ 3,54,500 to ₹ 3,45,000/- . This offer led to some internal discussion. Mr. Ujjagar Singh, prepared a note on 26.04.1993 for procuring 2500 systems from the vendors having type approval at the rate of ₹ 3,45,000 per system (Ex. PW-3/K-15). On 25.05.1993, Ms. Runu Ghosh, who had received the note as Financial Advisor wrote a note (Ex. PW-3/K-19) suggesting that an order for 1500 systems should be placed on M/s. ARM which was the only established supplier and that an order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e penciled notes on the margin; there is some dispute about what these notes were. However, what is of importance is that she refused to sign the Minutes, and made her separate noting, (Ex. PW-3/K-36) outlining the points of disagreement on 18.06.1993. These were that ARM had offered to pay liquidated damages @ 23% in case of delayed supply (by it) beyond a particular date, if the order was placed within a date specified. The other disagreement was with regard to the enumeration of advantages and disadvantages of the crystal version; the last two paras of the report were not acceptable by her, for this reason. She added that supporting documents from TEC were necessary, if these parts in the report were to remain on record. 87. It is at this stage that the Court needs to analyze the materials on record in the light of the submissions made, on two crucial aspects i.e. whether the synthesized version of the 2/15 MARR system was superior to the crystal version, (as found by the Trial Court); and secondly whether the costing exercise undertaken was justified. This analysis becomes necessary as it goes to the root of the Trial Court's findings that Ms. Runu Ghosh and Mr. Sukh Ram ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Switchable radio channels is cheaper by ₹ 2010.00 [11250-(10380-4 x 285)] 2/15 MARR System comprises of 17 such Transreceivers and the price reduction works out to be ₹ 2010 x 17= ₹ 34170.00 per system. 89. This price reduction proposal was acceptable to the Advisor (P) as is evident from Ex. PW-3/K-40. Sri Ujjagar Singh by his note Ex. PW-3/K-41 dated 19.07.1993, in the light of this development proposed that the revised price for the crystal version would work out to ₹ 3,03,750/- per unit and accordingly further suggested that the revised financial implications, turned out to be ₹ 84,06,75,000/- plus taxes. This note proposed that 300 crystal based systems were to be sourced from ARM and orders for 500 and 700 synthesized version systems were to be placed on Punwire and Shyam Telecom. It was further suggested that the balance 1000 systems of the synthesized version were to be procured from vendors who obtained type approval, after issue of the purchase order on the concerned firms M/s Punwire and Shyam Telecom. In this background Ms. Runu Ghosh wrote a detailed note Ex. PW-3/K-42 on 23.07.1993, it would be necessary at this stage to extract m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontract cannot be accepted. A further reduction in prices for the crystal controlled versions of ₹ 3000 per system (in addition to ₹ 34,170) has been suggested by DDG (RN) on account of the fact that some additional facilities like order wire and traffic measurement are available in the synthesized version supplied by M/s. Shyam but absent in the crystal version of M/s. ARM. Since the crystal version supplied by M/s. ARM conform to all the specifications given in the tender of 92-93 based on which the case is being processed, it will be incorrect to reduce the price of this systems on account of some additional features which are optional and provided by one bidder. It is understood from TEC that the synthesized version of M/s ARM has also been given the type approval now and this contains some additional features which are not available in the systems supplied by M/s Shyam or Punwire. If we reduce the price of crystal version which are acceptable as per our tender specifications on the basis of optional features of the product of any one bidder the logical thing to do would be to reduce the price of synthesized version supplied by M/s. Shyam or M/s. Punwire on acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... first batch of orders placed i.e. 500 units of crystal version, were pursuant to the same NIT. At that stage, no difference in quality was perceived; in fact the enter lot was to be awarded to ARM; however since Shyam Telecom claimed that it had received type approval, the order was split. In these circumstances, it was unfair at a much advanced stage for the officials at the lower and middle levels to start a campaign that the crystal version was inferior to the synthesized version. It was further urged that the PNC had no mandate to examine technology aspects and that Ms. Runu Ghosh's note emphasized this as well as the fact that such technology issues were never put to the vendors and suppliers when they were called for negotiations on 10.06.1993. The only person competent to comment on this aspect is Shi Rakesh Aggarwal (of TEC) who by his letter dated 26.07.1993 (PW-4/DZ/2) said that it was not proper to compare the two technologies or even attempt to differentiate in the manner suggested. 91. Learned Counsel had argued that at best the difference in the two technologies was a matter of perspective, an aspect highlighted by Mr. Sukh Ram and borne out by the notes of Ms ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able of withstanding wide variations of DC input were preferred. No plea that any accused was unaware of this condition (clause 1.1.10) was advanced. PW4 N.C. Gupta is a Telecom Engineer who joined as Deputy Director General (Rural Network), of DoT in 1990. His job was to ensure public rural telephony. His department was responsible for providing 2/15 MARR systems for rural telephony. The witness deposed about certain limitations in the crystal version developed by ARM and another vendor; but DoT had no alternative except to purchase such systems till indigenous development of the synthesized version (which was considered more flexible and versatile) took place. The limitations of the system were pointed out by PW-3, in his nothings (in the file) as well as in the report of PNC; he deposed about these limitations, in Court. He testified that the tender indicated use of the synthesized oscillator instead of the crystal oscillator, to overcome these limitations. PW-4 deposed to receiving reports regarding limitations of the crystal version, when he visited some sites. These limitations impelled the agency to requisition equipment with oscillators fitted with synthesized frequency con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... version depended on frequency control through a crystal. The important limitation of the crystal based technology version was that it could operate only on a fixed frequency. The DoT used to supply frequencies to the manufacturers and the system used to confirm to that frequency. However, in case of the synthesized version, the frequency could be changed with a dipswitch. Such change of frequency, in the case of the crystal version, needed replacement of crystals, which in turn meant that the equipments for changing crystals had to be taken to the field. PW-4 deposed that if the base unit or the subscriber unit went out of order and required placement, a unit with the same frequency was necessary, for replacement. The frequency in the case of the synthesized version could be changed by a dipswitch, in the system. Also, any spare unit could be used as replacement by change of frequency. In the case of the crystal based version, the frequency could not be changed in the field. Moreover, taking the spare unit to the workshop for crystal change, (to change system frequency) entailed substantial time, resulting in system unavailability to the unit subscriber concerned. If the dysfunctio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wherever new technology had to be installed. However, the advantage for the synthesized version, was that the surplus unit could be used at some other locale, where the new technology was not inducted. The frequency change mechanism posed serious limitations in the crystal version; such restrictions did not apply for the synthesized version. This was a distinct advantage or technological improvement, benefiting the DoT. 98. PW-4 s evidence further reveals that the synthesized version had a duplicate power supply and duplicate Low Noise amplifier (LNA). N.C. Gupta deposed that the crystal version was equipped with only one LNA/receiver and one power supply (unit). The benefit of a dual LNA and power supply was that in case of failure of one, the other would automatically take over. This too was a distinct technological edge for the synthesized version. 99. The third advantage was the order wire facility, in the synthesized version. PW4 s deposition shows that the synthesized version had the order wire facility which enabled direct communication from the base to the subscriber unit, and vice versa without the help of a telephone instrument. Mr. N.C. Gupta stated that in some ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... PW-4/E), however, sounding a note of caution that all vendors may not have been ready with the synthesized version. The Adviser (P) was asked to see this aspect; the latter asked DD (RN) to look into this aspect. DD (RN) by Ex. PW-4/F (07.05.1993) stated that ARM was likely to get type approval for the synthesized version in July, 1993, and Shyam as well as PUNWIRE had obtained it. The note of US Prasad (Ex. PW-3/K-20, dated 26.05.1993) stated, inter alia, that PUNWIRE and Shyam had obtained type approval for the technology. He stated that it would be prudent to source only 300 crystal based units from ARM. PW-3 Ujjagar Singh differed with this approach (of US Prasad, who wanted a fresh tender) and proposed price negotiation with the lowest bidders, in his note PW-3/K-21. The file had in the meanwhile gone to Ms. Runu Ghosh, and by her note, (PW-3/K-21) while proposing to issue an order on ARM for 1500 units, (dated 31-051993), it was observed that: ...The systems supplied by ARM are crystal controlled but this should not pose a problem in view of the fact that the firm has supplied about 1100 systems last year which are reported to be working satisfactorily in the field and fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that TEC issued type approval to only manufacturers whose products met with all specifications, and no two equipments were exactly same, in view of different manufacturers. All these materials were on record, when the approval for the price differentiation was given by Mr. Sukh Ram, in his note Ex. PW-3/K-60. 104. Apart from the above nothings and oral testimony of witnesses, after the orders were placed on the vendors in September, 1993, ARM made representations for change of terms; the representation to Mr. Sukh Ram, dated 11.09.1993, sought cost equalization vis- -vis the crystal and synthesized versions. This resulted in the entire matter being re-visited again. Here too, the file nothings - pertaining to technological superiority of the synthesized version, (PW-8/6, dated 12.10.1993, by DDG (PF) and the noting of Member (F) by Ex. PW-8/4) reiterated that the said product was superior to the crystal version. The Member (S) had by his note PW-3/K-80 stated that ARM's request for supplying 300 crystal version units could be granted as a special case but the price variation or differentiation was to remain. The Member (Technical), in the file noting dated 13.10.1993 (Ex. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the minister said that he had gone through all aspects, and decided that the same price was to be paid, that decision had to be implemented. In his deposition, he testified that the crystal version was inferior to the synthesized version, and that the Minister had the last word on all aspects relating to equipment procurement. 107. Having regard to all the above materials, this Court is of opinion that the Trial Court's finding about the superiority of the synthesized version, over the crystal version, cannot be faulted, and was based on sound reasoning. Price Differentiation between the crystal and synthesized versions 108. This issue i.e. price differentiation overlap to a great extent with the question of superiority of the synthesized version. Nevertheless it is important to consider this and whether view taken by the Trial Court in this regard was sound or whether there could be two opinions about price differentiation in which event the decision of Mr. Sukh Ram and Ms. Runu Ghosh is not as honest and bona fide. The materials on record - discussed in the preceding portion of the judgment, clearly point out to distinct advantages of the synthesized version; which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y to the established procedure and also that it was not endorsed by the TEC and for which the Appellant relied upon Sri Rakesh Aggarwal's letter dated 26.07.1993 (Ex. PW 3/DZ2). 109. The Trial Court has noted that Sri N.C. Gupta, in aid of his costing exercise, went through the rate contract and produced Ex. PW4/X. The crystal controlled transreceiver was priced at ₹ 10,380/- ; the synthesized trans-receiver was on the other hand cost ₹ 11,250/- . In his deposition, PW-4, N.C. Gupta tried to explain that a crystal based trans-receiver had six oscillators and six crystal sets, provided for DGS D in its rate contract and that each set had two crystals. The Trial Court went on to record the costing exercise in the following terms: 47. Ex. PW 4/X is the Rate Contract relied upon by M/s. N.C. Gupta for calculating price difference between synthesized version crystal version of 2/15 MARR system. It shows that rate of crystal controlled transreceiver was ₹ 10380 whereas the rate of synthesized transreceiver was ₹ 11250. Mr. N.C. Gupta came in the witness box as PW4 and explained that there are six oscillators and six sets of crystal in each crystal con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commission) in his deposition as PW-20 stated that synthesized version was superior to the crystal version and that the latter deserved a reduced price. The apprehensions expressed by Ms. Runu Ghosh that the costing exercise was unjustified and resulted in a charge of arbitrariness (and discrimination) on the ground that during price negotiations no such offer was made, was also considered by the other superior officers. This aspect was highlighted by her in the note (PW 3/K-42 dated 23.07.1993) appears to be an attractive submission, but at the same time the Court also has to take into consideration the fact that each of the manufacturer -who participated in the Price Negotiations Committee had made submissions and also brought letters with technical details which form part of the record (explaining all features and elaborating in the annexures to such documents the technical specifications) therefore, Ms. Runu Ghosh's reservations to the inclusion of the technical inputs, in the minutes of the PNC meeting, or its report cannot be believed. More so the other Members (of the PNC) had no axe to grind; nowhere was it suggested during the cross-examination of either PW-3 or PW-4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m. She also noted that since for the present procurement they were operating on last year's tender, it would be incorrect to operate on two rates for the same tender and fixing a higher price for synthesized version as opposed to crystal version. 113. The evidence on record would show that as on 13.07.1993 when N.C. Gupta made his noting Ex. PW-3/K-39, type approval for ARM's synthesized version had not been obtained. The file was apparently kept for consideration of the Minister Mr. Sukh Ram but due to pre-occupation was returned on 02.08.1993 (Ex. PW-3/K-44); subsequently it was re-submitted by the note of Ms. Runu Ghosh, -Ex. PW-3/K-45-on 05.08.1993. In his note (Ex. PW-3/K-46) Mr. Sukh Ram observed that the case had been abnormally delayed and that Gram Panchayat targets had been slipped. It was also noticed that unless the equipments arrived fast the targets would slide further. He therefore directed that the case should be decided within a week's time. Sri Dilip Sahay's note of 17.08.1993, Ex. PW-3/K-47 reflected the minister's concern and also emphasized the need to stick to clause 1.1.1.1 of the Tender specifications vis- -vis procurement of the synth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as proposed . It was in the light of these facts that the APO was issued to ARM on 02.09.1993. The order (Ex. PW-3/K-67) indicated in the terms and conditions annexed that the synthesized version was to be supplied at a total price inclusive of sales tax, of. ₹ 3,35,639/- and the 300 crystal version units were to be supplied for a total price of ₹ 2,98,469/- inclusive of sales tax. The terms and conditions also clearly stated that performance bank guarantee was to be kept valid till the expiry of the warranty period. 114. On 9th September 1993 ARM wrote a letter to DoT (Ex. PW-3/K-98) forwarding the bank guarantee for supply of 600 synthesized version systems and assured that the supply of those systems would be completed by the end of December 1993. But in regard to the crystal systems, M/s. ARM protested, saying that: price agreed upon during the PNC meeting, held on, 10.06.93 has not been given and, on the contrary, we have been asked to supply Tx/Rx cards one subscriber radio equipment, worth about ₹ 30,000/- as additional spare units. The DoT, however, did not agree. By its letter dated 17th September 1993 (Ex. PW3/K-102) the DoT informed M/s. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Prasad as Member (P). Mr. S.M. Prasad, Member (T) by his note Ex. PW-3/K-81 on 13.10.1993 reiterated the overwhelming view of the department that the synthesized versions had serious limitations in that it was site specific which inhibited its redeployment to other stations whereas no such restrictions applied in the case of the synthesized version. For the price, he left it to be decided by Production Cell. On this, Mr. R.S. Bansal, Member (P) stated (in his note PW-3/K-82 dated 13.10.1993) that para-wise comments may be prepared on the representation for the firm so that it could be considered by the Minister. The subsequent notes Ex. PW-3/K-83 and Ex. PW-3/84 did not make any separate comment and in fact one of them referred to the previous note, PW-3/K-79 (dated 4.10.1993 of Ujjagar Singh). In these circumstances, Ujjagar Singh prepared his note Ex. PW-3/K-85. That note (letter put up to the Minister by Ex. PW-5/9 on 15.11.1993 reads as follows:- PUC placed at 199-204/C is a letter from M/s. ARM, Hyderabad to the Hon'ble MOS(C) regarding procurement of 2/15 MARR systems. The point-wise comments are discussed at 61-62/N. Summarily these are as below: The distribution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are incorrect. The basis of the reduction is the price difference between crystal and synthesized versions of hand-held VHF trans-receivers but TEC has clearly mentioned that these trans-receivers are completely different from our 2/15 MARR systems in respect of design, concept and even application. Further, earlier we have taken both crystal version of M/s ARM and synthesized version of M/s Shyam at the same price against the same tender; at that time no such price reduction was attempted and now that we are basically operating on the same tender offering a lower rate for crystal version is clearly discriminatory. The crystal controlled 2/15 systems of M/s ARM are stated to fully meet DoT specifications. The firm is also an established supplier and the system supplied by them are working satisfactorily in the field. It would therefore be manifestly unjust to arbitrarily reduce the price of crystal controlled systems of M/s ARM. A suitable amendment may therefore be issued, at the earliest, to the effect that the price of crystal version of 2/15 systems should be equal to that of synthesized version, as in the earlier purchase orders. Necessary action on the above lines may be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut up for reconsideration to avoid audit para since the financial implication is as large as nearly ₹ 1.67 crores excluding ED 117. This recommendation, however, was rejected by the Appellant, Mr. Sukh Ram on 15.12.1993 by Ex. PW-3/K-89. This decision reads as follows: That the basic premises for cost reduction for crystal version are wrong, is clearly proved by the observations of TEC. That being so, we should not persistently repeat that a crystal version is inferior and therefore its cost should be less than that of synthesized version. M(T) has stated that while crystal version is specific to the site, there is no such limitation in the synthesized version, but simultaneously he has stated that the crystal version has 6 or 7 frequency pairs and can be used wherever such frequency pairs are operating which would put it at par with synthesized version which, I understand, can not be used for more than 6 or 7 stations depending upon whether the frequencies are in the low band or high band. The perceived inferiority thus appears to be merely a matter of opinion of one or two officers and is not substantiated by any comparative data on the actual working of c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l and synthesized versions were different and there had to be a price differential. The Minister told PW-17 that there has been certain degree of injustice done to ARM and in view of specific orders given in his note dated 13.12.1993 action to immediately implement his order was recommended by PW-17. It was in these circumstances that the amended Order was placed upon ARM for increase in the quantity of 450 sets of crystal versions, price parity of the crystal version with that of the synthesized version was agreed, requirement of spares supply was deleted, and sales tax was to be treated as extra. 118. The above narration, though a repetition of the facts in the preceding discussion, was necessary to exactly discern the role of each party and consider whether Mr. Sukh Ram's role pointed to his culpability in any manner. He apparently had occasion to go through the entire file; for the first time on 15.08.1993 when he observed that the decision has been unduly delayed; he desired that the decision should be speeded up and finalized within a week. After a further round of consultations and nothings by various officers at the senior most level, the file was put up to him. At t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d submitted the bank guarantee pursuant to the DoT's insistence through its letter dated 17.9.1993. In this regard, it was emphasized that Ujjagar Singh's note, Ex. PW-3/K-79 in fact contained hand-written interpolations at the end which did not exist. These interpolations, it was urged, highlighted that the bank guarantee had been furnished and the Purchase Order accepted by ARM. Apart from this, there was no other material suggesting that ARM had accepted the offer and furnished the bank guarantee. The other main submission on behalf of Mr. Sukh Ram was that operating by the same tender, the crystal version had been accepted, along with the synthesized version parties were offered the same price. Having regard to this, since there was absolutely no change of circumstance, the view taken by Mr. Sukh Ram subsequent to his earlier decision on 31.08.1993 was a plausible and reasonable one. He was not only concerned with ensuring speedy rural tele-density but also avoiding the exposure of the Department to needless litigation which would have inevitably followed if the price disparity were persisted with. In this regard, it was submitted that all Department officials, includin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt noted that there were other portions in the entire file containing nothings where Ujjagar Singh had written his comments by hand. This part of the discussion and findings may be found in para 53 of the impugned judgment. The Trial Court noted that Ujjagar Singh had made handwritten insertions in his earlier note, Ex. PW-3/K-2 and also his note, Ex. PW-3/K-56 (dated 24.08.1993). It was also noticed that Ex. PW-3/K-79 started at one portion of a page on which the note had been written by another officer. 122. The Trial Court reasoned, in our opinion, perceptively that had Ujjagar Singh been inimical to ARM, his note, Ex. PW-3/K-79 he would have highlighted that there was no price or cost parity, to dissuade the Minister from accepting ARM's representation. The other circumstance which impressed the Trial Court to hold that Mr. Sukh Ram knew that ARM accepted DoT's offer - containing the price differential -was that a Purchase order would be issued to a party after acceptance of the APO and furnishing of bank guarantee. In the statement recorded under Section 313, Mr. Sukh Ram had admitted to this practice. The Trial Court held that the typed portion of Ex. PW-3/K-79 it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... compared to the crystal version. It is a matter of record that unlike in December 1992 (when only ARM had type approval,-for the crystal version-and was the established supplier and Shyam had just received type approval for the crystal version) PUNWIRE and Natelco, apart from Shyam had type approval for the synthesized version. ARM had just obtained type approval for its synthesized version. Sri Ujjagar Singh justified the price differential and pointed out that it had been agreed to by the Finance Department. On 13.10.93 DDG (PF), noted that Finance had agreed with the recommendation of the Technical branch. DDG (PF) s note (this officer belonged to the Finance department) was approved by Member (Finance). The Member (S) agreed to increase the order (for ARM's crystal version from 300 to 450 systems). He recommended that price conditions should remain the same. On 14.10.93 the procurement department prepared Para-wise comments on the representations of ARM. Ujjagar Singh recorded yet another note on 15.11.93 (PW-3/K-85) and referred to the notes of DDG (RN), noting of Mr. N.C. Gupta regarding the price differential and also underlined that the Finance Department had agreed to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... motives, or is not based on irrelevant considerations, courts will not question its wisdom. However, the test always in such cases is whether the decision was such as someone acting reasonably, on the basis of the materials available, would have taken. The test of public interest is paramount; if it appears that the decision is taken without public interest in mind, and unreasonably or manifest disregard to the consequence that such act would be severe undermining of public interest, and that such decision would result in a third party obtaining pecuniary advantage, without public interest, the decision maker has to take responsibility for the consequences. 127. In the preceding discussion it was held that there were serious limitations in the crystal version of 2/15 MARR supplied by ARM. Those were offset in the synthesized version of the system. Technical Officials in the DoT unanimously advised about these serious limitations, in the crystal version and existence of additional features in the synthesized version. It is nobody's case that Mr. Sukh Ram had technical expertise, or the benefit of opinion of any independent expert's opinion. Indeed, during the trial no su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e NIT was procured with the same price for the two systems, which meant that the Minister, Mr. Sukh Ram, merely followed that principle of price parity, is concerned, ex-facie, the argument seems attractive. Yet, the entire sequence shows that the synthesized version was the preferred product; some weight had to be given to this preference; indeed, several file nothings support the view that the synthesized version had to be procured for its technical superiority, and its compatibility with emerging technologies. At the time when the 500 units were procured, -in fact when the order was finalized initially - it was only ARM which had type approval, and was an established supplier. Its approval was for the crystal version. Just before the order was placed, on 25th November, 1993, Shyam's type approval for the synthesized version materialized; therefore, it secured a part -200 units-of the first order for 500 units. The circumstances changed, after the PNC report; PUNWIRE had also obtained type approval for the synthesized version; Natelco soon followed suit; ARM's type approval was also given in July, 1993. Therefore, when, in end July 1993 and August, of the same year, DoT h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 13(1)(d)(iii) has been recorded. The Court also recorded that all the accused acted in concert, and were guilty for the offence under Section 120-B read with the other provisions; Mr. Sukh Ram and Ms. Runu Ghosh were held guilty for the offence of conspiracy, of jointly acting together; Ms. Runu Ghosh was also held guilty of conspiracy with Mr. Rama Rao. 130. Now, the expression abuse of office by an accused is not new; it has been in the lexicon - in the context of corruption laws, for over six and a half decades. The best exposition of what action would be abuse is to be found in Narayana Nambiar (supra): The juxtaposition of the work 'otherwise' with the words 'corrupt or illegal means', and the dishonest implicit in the word 'abuse' indicate the necessity for a dishonest intention on his part to bring him within the meaning of the clause. Whether he abused his position or not depends upon the facts of each case. 131. Counsel for the parties have referred to several decisions, which have been noticed and dealt with in an earlier part of this judgment. For an act to be abuse there is a need to prove an element of dishonesty. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecuniary advantage, without any public interest. Had he followed the predominant technical opinion that the crystal version was inferior to the synthesized version and had to be priced less, the DoT would have paid ₹ 37,170/less per unit of (450) crystal based units which were procured. This decision cost the exchequer ₹ 1,67,26,500/- ; and was without public interest. Correspondingly, ARM stood to gain pecuniary advantage to the extent of ₹ 1,67,26,500/- . Being the Minister, empowered to act on behalf of the Government, (since his word was the final one in this matter) and acting as a trustee of the people, it was his duty to follow all safeguards in deciding such matters. His act, in completely disregarding all opinions, and acting without any discernable reason, and with no change in circumstance, solely benefited ARM. For these reasons, we are of the opinion that the conviction under Section 13(1)(d) (ii) and (iii) read with Section 13(2) of the Prevention of Corruption Act, 1988 returned by the Trial Court, against Mr. Sukh Ram was justified; the same is accordingly affirmed. 132. As regards criminal conspiracy, that is one, under Section 120-B, IPC. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fter the note dated 23-071993. Mr. Sukh Ram had not acted on it; therefore, the finding his guilt under Section 120-B IPC with Ms. Runu Ghosh is not justified. Similarly, the evidence at best points to suspicion - maybe even strong suspicion, that there was prior concert, or conspiracy to benefit ARM. However, that suspicion is insufficient to amount to proof of criminal conspiracy. this Court therefore, sets aside the conviction of Mr. Sukh Ram, recorded by the impugned judgment, under Section 120-B IPC. Correctness of Findings in regard to Ms. Runu Ghosh 134. The counsel for Ms. Runu Ghosh made two pronged attack on the impugned judgment. this Court has dealt with the findings regarding the superiority of the synthesized version as well as the justification for the price differential. The facts pertaining to those would not be repeated except to the extent that a discussion is necessary vis- -vis Ms. Runu Ghosh's role. Her contentions were that her role was limited; as Director (Finance) with the DoT, she had to consider the financial implications and make her appraisal having regard to the overall objectives of the speedy installation of telephone systems in rural area ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e was no question of any conspiracy either with Mr. Rama Rao or with Mr. Sukh Ram. It was further argued that in order to constitute a criminal conspiracy findings cannot be based on so called suspicious circumstances but there should be something more substantial for the Court to irresistibly hold that the accused conspired to achieve a common objective, with the other accused. 136. In this case after ARM offered to reduce unit price by its letter dated 16.04.1993 (Ex. PW-3/K-14), in view of customs duty concession, another letter was addressed to DDG (RN) by it, on 22.04.1993 (Ex. PW-3/D-2). This letter volunteered that in case the DoT decided to change the operating frequency of any crystal version within 3 years from the date of supply for any reason ARM undertook to do so in situ, free of cost. ARM requested that a purchase order for 500 numbers of crystal version therefore, ought to be released and that the order would be complied with and systems would be delivered by 30.06.1993. It was this letter which Ms. Runu Ghosh adverted to in her noting of 25.05.1993 (Ex. PW-3/K-10). ARM's anxiety appeared to be to ensure that the systems which were lying with it, were procure ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otiate with vendors so as to obtain a favorable price for the department. No suggestion was made by her to verify how much was the actual advantage derived by ARM on account of duty concessions announced in the budget. As regards the crystal version's limitations in the matter of frequency change, she noted that ARM had offered to change the frequency in situ, free of cost in case DoT decided to change operating frequency of any crystal controlled version supplied by them. The evidence on record shows that for frequency change, in case of the crystal version, the system had to be taken to the workshop or the equipment had to be taken to the field. Mere change of crystal would not have resulted in use of changed frequency, as transmitters and receivers too had to be tuned to the changed frequency. The crystal version was likely to be dysfunctional for some time, consequently, and could be operational after some period. 139. As discussed previously Ms. Runu Ghosh refused to sign the report of the PNC. The committee's recommendation for the price of ₹ 3,40,750 per system with one duplicate unit each of LNA and power supply being applicable to the synthesized version o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by accused Runu Ghosh either towards the evening of 19.7.93 or on 20.7.93 and the letter Ex. PA16 was written on 21.7.93, there was no intimation to ARM that the file was being examined by accused Runu Ghosh, it would be reasonable to infer that accused Runu Ghosh was in communication with ARM and it was she who intimated them that the file was lying with her and pursuant to that ARM wrote this letter highlighting that they were charging only ₹ 7837 per system towards sales tax as against normal tax amounting to ₹ 15675 and accordingly accused Runu Ghosh highlighted this point in her note dated 23.7.93. Ex. PW3/K-42 is Ms. Runu Ghosh's note of 23.7.93. She stressed that ARM had agreed to accept 23% liquidated damages for delay in delivery of the systems, in case it failed to supply 1500 them by 15.02.94. She further added that this offer was not reflected in the draft minutes of the PNC. ARM's letter dated 10.6.93 (Annexure 1 to Ex. PW-3/K-29), a four page document, partly handwritten, and signed by Mr. Rama Rao) shows that the firm agreed to accept liquidated damages conditional upon the DoT purchasing 450 crystal version and 1050 synthesized version from it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, was also held to be due to her anxiety to ensure that ARM was favored, because if the file were forwarded earlier, there was a risk of other officers overruling her. this Court is of the opinion that such hypothesis at best amounts to suspicion; it cannot be 142. The facts on record, in the form of the notes written by Ms. Runu Ghosh, on considered a strong circumstance, and not one which amounts to the Appellant's guilt. 25th May, 1993; her insistence that technical issues regarding the superiority of the synthesized version, were not discussed in the PNC deliberations (despite oral testimony of witnesses to the contrary, and in spite of the vendors furnishing detailed letters containing technical particulars), her note Ex. PW-3/K-36, her dogged persistence in her file nothings that the crystal version could not be priced lower than the synthesized version, and her recommendation (of 25th May, 1993) to purchase 1500 units, including the synthesized version, by emphasizing that ARM offered to pay liquidated damages (without pointing out the condition that the offer had to be given before 10-7-1993, and without highlighting that type approval for ARM's synthesized vers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m's concerns and its desire to push its product. The Trial Court considered yet another circumstance, i.e. recovery of blank, signed letter heads, from Ms. Runu Ghosh's office. During search of her office, the CBI found and seized two blank letter heads of ARM Ltd. signed by Mr. Rama Rao in her office table drawer. Ms. Runu Ghosh denied the recovery of these documents, in her statement under Section 313 of Cr.PC. PW-7 Sri R.P.S. Chauhan, Superintendent in the Income Tax Department, a public servant requisitioned by CBI through Commissioner (Income Tax) to accompany its officials to Ms. Runu Ghosh's for the search there on 16.8.96 deposed that Ms. Runu Ghosh's office, Room No. 304 was locked and was forced opened by an official of the Sanchar Bhawan. He deposed that the letter heads Ex. P1 and P-2 were found in the table drawer in that room. PW-7 signed as a witness, at point A on the letterheads. The seizure memo of the letter heads Ex. PW6/1 also bears signature of the witness at point B. PW-6 Sri Ganesh Verma was posted as DSP in CBI on 16.8.93. A warrant had been issued by the Special Judge Delhi to conduct search in the Ms. Runu Ghosh's office, Room No. 304, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vious note that ARM's previous offer was conditional upon placement of order for the synthesized systems, even when it did not have type approval for it, can, therefore be explained by her acting virtually as a spokesperson for ARM. No doubt, the record does show that other concerns too were writing letters to various officers (including the letter written to DDG by ARM itself on 22-04-1993). Yet, there was no brazen endeavor on the part of anyone to favor any technology, or concern the way Runnu Ghosh sought to, for ARM. On the contrary, all file nothings of various officers-such as Sri. D. P. Srivastava, Sri. N.C. Gupta, Sri. Ujjagar Singh, Sri U.S. Prasad, and Adviser and Member level officers, such as U.V. Naik, R.S. Rastogi, M.G. Kulkarni, etc consistently showed that the synthesized version was preferred, and all of them were conscious of the serious system limitations that beset the crystal based version. 145. Ms. Runu Ghosh too had argued that DoT paid same price for both the crystal and synthesized versions in case of purchase the first lot of 500 units; the tender was the same. Nothings in the file Ex. DW3/1, and the deposition of Mr. Vishwajeet, in this regard wer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erefore lapsed; moreover, that offer, when made, could not have been acted upon, because ARM did not possess type approval for the synthesized version (in June, 1993). (5) Ms. Ghosh's insistence in her penciled comments, and in her subsequent note, of 18.06.1993 that technical aspects were not discussed, during the PNC meetings, is contradicted by the depositions of PW-3 and PW-4. Furthermore, the letters furnished by the vendors, including ARM, do contain technical data and features claimed by their products; (6) Ms. Runu Ghosh's attempt to advocate ARM's product is evident from its letter (Ex. PA-16 dated 21.07.1993) offering to lower sales tax. This was included in her note of 23.07.1993, to garner support for its product. (7) Her note dated 23.07.1993, claimed that according to TEC, ARM's crystal version had certain additional features, not present in the products of other concerns. However, Rakesh Agarwal (the TEC member who wrote to Ms. Runu Ghosh) replied to her letter (of 20th July, 1993) only on 26th July, 1993 (Ex. PW-3/DZ-2). Even that letter is silent about such unique or additional features. (8) Ms. Runu Ghosh's direct letter to Rake ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... viction with Mr. Rama Rao, under Section 120-B, IPC, read with Section 13(1)(d)(ii) of the Prevention of Corruption Act, 1988, is also upheld. Findings concerning Mr. Rama Rao 148. As regards Mr. Rama Rao, the evidence on the record, in the form of the letter, by which ARM offered to revise the cost of the crystal version downwards, dated 16th April, 1993, was written by him as ARM's Managing Director. He pursued ARM's interest with DoT. ARM also wrote the letter dated 22-04-1993, offering to make in situ change of frequency, free of cost, in respect of the crystal version, for three years, if the order was placed on that company. He pursued ARM's interest before DoT, in respect of purchase of 2/15 MARR systems. He appeared before Price Negotiation Committee on behalf of ARM, and offered by its letter, (Annexure 1 to Ex. PW-3/K - 29), to bear 23% liquidated damages, in case ARM did not complete supply of the equipment, on condition that the order were placed on it, before 10-7-1993. ARM also wrote the letter dated 21st July, 1993, after the PNC meeting of 10th July, 1993, (Ex. P/A -16), highlighting that it would be charging 2% Sales tax, which would result in DoT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned, partly handwritten letter handed over to the PNC on 10.06.1993 - in which he offered to pay 23% L.D in case of late supply if the order were placed by 10.07.1993-and later, the representation dated 11.09.1993) were sold to the DoT. There is evidence in the form of Ms. Runu Ghosh's notes that ARM had supplied the crystal version earlier, which had been installed in the field. The handwritten note given to the PNC on 10th June, 1993, in fact holds out the sop that if the order for 1500 systems - of which clearly, 450 units were to be the crystal version, were to be placed on ARM, the latter would bear 23% liquidated damages in case of delay in supply of the equipment before 15.02.1994. However, no such order was placed. Yet, this offer was resuscitated - mysteriously in Ms. Runu Ghosh's note of 23.07.1993. The original offer to give such concession, only if the order were placed before 10.07.1993. Yet, Ms. Runu Ghosh made it out as if that was a positive feature, in her note (Ex. PW-3/K-42). That would have been possible only if it had the concurrence of Mr. Rama Rao, and ARM; in any case, if that suggestion were accepted, without any corresponding commitment by ARM, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CBI during the trial was in the nature of two blank letterheads signed by Mr. Rama Rao, which were found in the office of Ms. Runu Ghosh. PW-06 and PW-07 testified to having witnessed the recovery and seizure of these signed letterheads, of ARM, from Ms. Runu Ghosh's table (sic desk) in her office which was locked but had to be forced open. Mr. Rama Rao acknowledged that the letterheads were that of ARM; his explanation however, was that they had been handed over to one Mr. Alok Tandon of Shyam Telecom at the latter's request and given in 1995 to enable to correspond between Tele-link India Ltd (a joint-venture of Shyam Telecom and ARM). Apart from there being no corroborative material in this regard - since the defense did not lead evidence, either oral or documentary to support such a statement - the explanation itself partially corroborates the allegation. If indeed there was some joint-venture between two erstwhile rivals, the question which still remained unanswered was why did blank-but signed letterheads of ARM-find their way to Ms. Runu Ghosh's official desk. The other argument addressed during the appeal before this Court was that ARM's name had been change ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pt out of the march, at some stage, or join at another, without changing the words on the banner (Ajay Agarwal v. Union of India AIR 1996 SC 1637). Similarly, in Bimbadhar Pradhan v. State of Orissa AIR 1956 SC 469, the nature of the offence (of criminal conspiracy) was explained as follows: the offence of criminal conspiracy consists in the very agreement between two or more persons to commit a criminal offence irrespective of the further consideration whether or not those offences have actually been committed. The very fact of the conspiracy constitutes the offence and it is immaterial whether anything has been done in pursuance of the unlawful agreement. But in this case the finding is not that Government money had not been misappropriated or that the accounts had not been falsified... In State of Maharashtra v. Som Nath Thapa 1996 (4) SCC 649, the Supreme Court stated as follows: ..to establish a charge of conspiracy knowledge about indulgence in either an illegal act or a legal act by illegal means is necessary. In some cases, intent of unlawful use being made of the goods or services in question may be inferred from the knowledge itself. This apart, the prosecution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... letter dated 20.07.1993, i.e. Ex. P-13); her incorporation of the offer received from ARM in its letter dated 21-07-1993 in the note Ex. PW-3/K-42; the mention of liquidated damages offered by ARM, in the same noting - suppressing the conditional nature of the offer - and the recovery of ARM's two blank letterheads containing Mr. Rama Rao's signatures, are all irrefutable evidence to criminal conspiracy between the two of them, solely to advance that concern's interests. Having regard to the above discussion, it is held that the prosecution successfully proved through circumstantial evidence in the form of letters and office nothings that Mr. Rama Rao and Ms. Runu Ghosh were guilty for committing the offences punishable under Section 120-B, IPC, read with Section 13(1)(d) (ii) and (iii) and Section 13(2). The circumstances proved satisfy the test mandated by the Supreme Court in its judgments, notably Sharad Birdichand Sarda - vs.-State of Maharashtra AIR 1984 SC 1622, i.e. that each circumstance alleged by the prosecution must be proved conclusively; the links to each circumstance should be equally proved in a conclusive manner; every hypothesis of the accused innocenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been almost the alter ego, of public life; it afflicted ancient Rome, medieval Europe (and led to Reformation of the Church); was in medieval India, and also during colonial times. Democracy has, to our country meant a beacon of hope, where the people are in a continuous process of empowering themselves. The phenomenon of corruption has engaged debate and concern in International institutions, like the United Nations; on 31-10-2003, the General Assembly of that body adopted the United Nations Convention against Corruption. The Preamble to the Convention states, very pertinently that: Concerned about the seriousness of problems and threats posed by corruption to the stability and security of societies, undermining the institutions and values of democracy, ethical values and justice and jeopardizing sustainable development and the rule of law, Concerned also about the links between corruption and other forms of crime, in particular organized crime and economic crime, including money laundering, Concerned further about cases of corruption that involve vast quantities of assets, which may constitute a substantial proportion of the resources of States, and that threaten the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (including protection of tenure and conditions of service) without which their existence would be meaningless. A similar debate in regard to creation of an exclusive judicial cadre (by invoking Article 312 of the Constitution of India), consistent with appropriate control mechanisms existing under the Constitution (Articles 233, 235 and 227) may be undertaken. These are reflections; ultimately, it is for Parliament, and other institutions to consider and take appropriate measures. 161. This Appeal was received upon a reference to the Division Bench, as regards the true interpretation of Section 13(1)(d)(iii). We have indicated the test applicable, -i.e. when the decision or an act of a public servant, (which results in another obtaining pecuniary advantage or valuable thing) be without public interest, namely, if that action of the public servant is the consequence of her or his manifest failure to observe those reasonable safeguards against detriment to the public interest, which having regard to all circumstances, it was his or her duty to have adopted. 162. this Court has indicated the reasons why the test indicated above, is the appropriate one; we have considered the hi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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