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CASE NO.: Appeal (crl.)  1335 of 2004

PETITIONER: State Inspector of Police Visakhapatnam

RESPONDENT: Surya Sankaram Karri

DATE OF JUDGMENT: 24/08/2006

BENCH: S.B. Sinha & Dalveer Bhandari

JUDGMENT: J U D G M E N T

S.B. Sinha, J.

The State is in appeal before us impugning the judgment and order  dated 31st October, 2003 passed in favour of the respondent herein by the  High Court of Judicature of Andhra Pradesh at Hyderabad whereby and  whereunder a judgment of conviction and sentence passed as against the  respondent under Section 13(2) of the Prevention of Corruption Act, 1988  (’the Act’, for short) and sentencing him to undergo Rigorous Imprisonment  for 3 years and to pay a fine of Rs.4 lakhs and in default to suffer Simple  Imprisonment for one year, was set aside.   

The respondent was an Assistant Station Master.  He was working in  the South Eastern Railway, Vizianagaram, Andhra Pradesh from 16.12.1961  to February, 1984.  He was promoted to the post of Commercial Inspector  and was working in that capacity from February, 1984 to July, 1986 and as  Senior Commercial Inspector from July, 1986 to December, 1993.  He was  later promoted as Chief Commercial Inspector and was working in the said  capacity from December, 1993.  His wife, Smt. K.S. Satyeswari, who  examined herself as D.W.1, was an income tax assessee.  All the three sons  of the respondent had been working.  A raid was conducted in his house and  also in the houses of his sons.  Some incriminating documents were  allegedly recovered.   

During investigation, not only the statement of the respondent, but  also that of his wife and three sons were recorded by the Investigating  Officer.  The investigation was admittedly carried on by P.W.41 \026 Shri K.  Biswal and P.W.42 \026 Shri N. Vishnu.  Sanction of prosecution was accorded  by P.W. 37 \026 Shri Debaraj Panda, the then Senior Divisional Commercial  Manager, South-Eastern Railway.   

The check period under consideration was 1.1.1986 to 9.8.1994.  The  prosecution proceeded on the basis that whereas the total income of the  respondent and his family members was Rs.6,73,203.69p. including loans  and advances during the aforesaid check period, the respondent and his  family members had expended Rs.3,31,068.75p.; and acquired assets both  movable and immovable worth Rs.11,66,873.84p. during the said period.  It  was also alleged that respondent was in possession of assets and pecuniary  resources in his own name as also in the name of his wife to the tune of  Rs.6,54,738.90p., which was disproportionate to his known sources of  income as on 9.8.1994.   

Before the learned Special Judge the respondent examined defence  witnesses, including his wife (D.W.1), his three sons, namely, Shri Karri  Satyanarayana Sarma (D.W.2), Shri K. Srinivas (D.W.3), Shri K. Rama  Sarma (D.W.4) and one Engineer, D.W.5 \026 Shri A. Sridhar, who submitted

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his report in regard to valuation of respondent’s house.   

The learned Special Judge in his judgment, inter alia, opined that the  sons of the respondent, other than his eldest son, did not make any  contribution from their salaries.  Reliance was placed on the valuation report  submitted by the Engineer of the Income Tax Department, P.W.36 in  preference to the Valuer appointed by accused, i.e., D.W.5.  The High Court,  however, by reason of the impugned judgment, inter alia, held that keeping  in view the societal norms prevailing in India, vis-‘-vis, the developed  countries, the sons of appellant presumably make substantial contribution  from their income to their parents.   

The High Court also relied upon a large number of decisions of this  Court in coming to the conclusion that if a reasonable margin of 10% is  accorded, the respondent cannot be said to have failed to have proved in  showing means for acquiring assets held and possessed by him as also by his  wife.   

Mr. A. Sharan, learned Additional Solicitor General appearing on  behalf of the appellant in support of this appeal would submit that -

i)      The wife of the respondent-D.W.1, having categorically stated  that only the eldest son, namely, D.W.2 had been making contributions to  the family, the learned Special Judge must be held to have arrived at a  correct finding of fact that other sons of the respondent having been residing  separately had not been making any such contribution.   

ii)     The rental income of Rs.88,318/- disclosed in the income tax  return filed by D.W.1, was reckoned twice by the High Court and if the said  sum is taken into consideration towards the income of the respondent, the  High Court must be held to have committed an error in holding that the  assets held by the respondent were marginally higher than the known  sources of income.   

iii)    The learned Special Judge having assigned sufficient and  cogent reasons to accept the report of the Engineer appointed by the  prosecution, the same should not have been reversed by the High Court.  

iv)     The High Court also committed an error in calculating the  household expenditure of the respondent.

Mr. A.T.M. Ranga Ramanujam, learned Senior Counsel appearing on  behalf of the respondent, however, submitted :  

(i)     The learned Special Judge committed a manifest error in so far  as he failed to take into consideration that the investigation carried out by the  P.Ws. 41 and 42 was wholly illegal having not been carried out under the  authorization of the Superintendent of Police; and

(ii)    No document having been brought on the records to show that  P.W.37 \026 Shri Debaraj Panda was delegated with the power to accord  sanction of prosecution as against the respondent, the same was vitiated in  law.  

Although, we have strong reservation in regard to the manner in  which the High Court dealt with the entire appeal, but we are satisfied that  the investigation carried out by the Investigating Officers was wholly unfair.     We, for the reasons stated hereinafter, are also of the opinion that the P.W.37  could not be said to have been delegated with the power of according  sanction of prosecuting the respondent.   

The Prevention of Corruption Act was enacted to consolidate and  amend the law relating to prevention of corruption and for matters connected  therewith.  The Act is a Special statute. It contains special procedure not  only in regard to the manner in which the complaint is to be filed, but also

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the mode and manner in which the investigation into an offence thereunder  is required to be carried out.  It provides for trial by Special Judges  appointed for the said purposes.   

Section 26 of the Act lays down that the powers of the Special Judges.   He has a power to try summarily under Section 6.  Section 13 provides for  criminal misconduct by a public servant.  The fact that respondent is a public  servant is not in dispute.  Section 13(e) specifies criminal misconduct of a  public servant where, an accused himself or any person on his behalf, is in  possession or has, at any time during the period of his office, been in  possession for which the public servant cannot satisfactorily account, of  pecuniary resources or property disproportionate to his known sources of  income.   

Provisions of the 1988 Act, no doubt, like the 1947 Act seek to protect  public servant from a vexatious prosecution.  Section 17 provides for  investigation by a person authorized in this behalf.  The said provision  contains a non-obstante clause.  It makes investigation only by police officer  of the ranks specified therein to be imperative in character.  The second  proviso appended to Section 17 of the Act provides that an offence referred  to in clause (e) of sub-Section (1) of Section 13, shall not be investigated  without the order of a police officer not below the rank of a Superintendent  of Police.  Authorization by a Superintendent of Police in favour of an  officer so as to enable him to carry out investigation in terms of section 17 of  the Act is a statutory one.  The power to grant such sanction has been  conferred upon the authorities not below the rank of Superintendent of  Police.  The proviso uses a negative expression.  It also uses the expression  "shall".  Ex-facie it is mandatory in character.  When the authority of a  person to carry out investigation is questioned on the ground that he did not  fulfil the statutory requirements laid down therefor in terms of the second  proviso, the burden, undoubtedly, was on the prosecution to prove the same.   It has not been disputed before us that the Investigating Officer, P.W.41, did  not produce any record to show that he had been so authorized.  Shri K.  Biswal, the Investigating Officer, while examining himself as P.W.41,  admitted that he had not filed any authorization letter stating :        "I have received the specific authorisation from  S.P., C.B.I., to register a case but I have not filed the said  authorisation letter."

No explanation has been offered therefor.  Even no attempt was made  to bring the said document on record at a later stage.

Although a specific contention was raised in that behalf on behalf of  respondent, the learned Special Judge negatived the same holding :

"It is contended that P.Ws. 41 and 42 failed to  produce orders of the Superintendent of Police, C.B.I.,  Visakhapatnam which are mandatory under the second  proviso to section 17 of the Prevention of Corruption  Act, for any Inspector of Police to take up investigation  into an offence under Section 13(1)(e) of the Act.  No  doubt, the prosecution did not file the orders of the  Superintendent of Police, C.B.I., Visakhapatnam in this  regard.  But, P.W.41 deposed that he registered this case  and issued Ex.P-54 F.I.R. on the instructions of  Superintendent of Police, C.B.I., Visakhapatnam.  In the  cross-examination, he deposed that he received specific  authorization from the Superintendent of Police, C.B.I,  Visakhapatnam to register the case.  Ex.P-54 F.I.R.  which was forwarded to this Court by the Superintendent  of Police, C.B.I./S.P.E., Visakhapatnam, shows that  P.W.41 deposed that as per the orders of the  Superintendent of Police, C.B.I., Visakhapatnam, he took

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up investigation in this case.  Though it is contended by  the defence counsel that the orders of the Superintendent  of Police authorizing P.Ws. 41 and 42 to investigate into  this case were not filed into court, there is absolutely no  cross-examination of P.Ws. 41 and 42 to investigate into  this case inspite of there did not in fact give any such  orders authorizing P.Ws. 41 and 42 to investigate into  this case inspite of there being lengthy cross-examination  of those witnesses."       The approach of the learned Special Judge, to say the least, was not  correct.  When a statutory functionary passes an order, that too authorizing a  person to carry out a public function like investigation into an offence, an  order in writing was required to be passed.  A statutory functionary must act  in a manner laid down in the statute.  Issuance of an oral direction is not  contemplated under the Act.  Such a concept is unknown in Administrative  Law.  The statutory functionaries are enjoined with a duty to pass written  orders.   

Submission of the learned Additional Solicitor General was that the  respondent did not further cross-examine the said witnesses to the effect that  no such order in writing was passed, and thus, he cannot be said to have  been prejudiced in any manner whatsoever.  We do not agree.

It is now well settled that when a document being in possession of a  public functionary, who is under a statutory obligation to produce the same  before the court of law, fails and/or neglects to produce the same, an adverse  inference may be drawn against him.  The learned Special Judge in the  aforementioned situation was enjoined with a duty to draw an adverse  inference.  He did not consider the question from the point of view of  statutory requirements, but took into consideration factors, which were not  germane.   

    Illegality apart, the manner in which the investigation was  conducted, is condemnable. The least that a court of law would expect from  the prosecution is that the investigation would be a fair one.  It would not  only be carried out from the stand of the prosecution, but also the defence,  particularly, in view of the fact that the onus of proof may shift to the  accused at a later stage.  The evidence of P.W.41 raises doubts about his  bona fide.  Why he did not examine important witnesses and as to why he  had not taken into consideration the relevant documentary evidence has not  been explained.   He did not even care to ascertain the correctness or  otherwise of the status of both of the respondent and his wife before the  Income Tax Department.  Above all, he did not produce before the Court the  statements made by the appellant, his wife and those of his sons, although  they were relevant.  Had the statements of D.W.3 and D.W.4 been produced  before, the learned Special Judge might not have opined that the sons of the  respondent, other than D.W.2, did not make any contribution to their parents  at all.  If such statements were made by the said witnesses before the  Investigating Officer, omission on the part of D.W.1, the wife of the  respondent, to state the same before the Special Judge might have taken a  back seat and the statements of other sons of the respondent, namely, D.W.3  and D.W.4 might not have been ignored by the learned Special Judge.   

The courts are obliged to go into the question of prejudice of the  accused when the main investigation is concluded without a valid sanction.   {See State of Andhra Pradesh vs. P.V. Narayana [(1971) 1 SCC 483 :  AIR 1971 SC 811]. }  

It is true that only on the basis of the illegal investigation a proceeding  may not be quashed unless miscarriage of justice is shown, but, in this case,  as we have noticed hereinbefore, the respondent had suffered miscarriage of  justice as the investigation made by P.W.41 was not fair.

The learned Trial Judge furthermore also committed a serious error in

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so far as he failed to take into consideration that Shri Debaraj Panda, who  examined himself as P.W.37, being a Senior Divisional Operations Manager,  was not competent to accord sanction for prosecution of the respondent  herein.  He, in his evidence, accepted that under the Rules he was not the  competent authority to remove him from service.  However, he stated that he  had been delegated with power of removing the Chief Commercial Inspector  of the Headquarter of South-Eastern Railway.  He also stated :

"It is not true to suggest that only General  Manager and Divisional Railway Manager are the  competent persons to remove the accused from service  and also to accord sanction to prosecute him.  It is not  true to suggest that I am not competent to remove the  accused from service and also accorded sanction to  prosecute him.  The delegation of powers in respect of  certain officers by the Head quarters, South Eastern  Railway are available in a Booklet called as "Delegation  of Powers" on Establishment matter."

  The purported delegation of power had never seen the light of the  day.  No reliance thereupon could have been placed to arrive at a finding that  the said witness was authorized to accord sanction.  The learned Special  Judge did not apply his mind to these aspects of the matter at all.   

This question came for consideration before this Court in Sailendra  Nath Bose vs. State of Bihar [AIR 1968 SC 1292], wherein it was  categorically held :

"P.W. I deposed that the appellant was a Class III  officer and that he could have been appointed or  dismissed by the Deputy Agent Personnel who is  subordinate to him. Therefore he (P.W. 1) was competent  to grant previous sanction under Section 6(1) of the  Prevention of Corruption Act. P.W. 1’s assertion that the  appellant could have been removed from his office either  by the Deputy Agent Personnel or by himself was  challenged in his cross-examination. The trial court as  well as the High Court have relied on the oral evidence of  P.W. 1 in coming to the conclusion that the sanction  granted is valid. In our opinion those courts erred in  relying on oral evidence in deciding the validity of the  sanction granted. Hence, we asked the learned counsel  for the respondent to satisfy us with reference to the rules  on the subject that P.W. 1 was competent to remove the  appellant from his office. For this purpose we granted  him several adjournments. Though our attention has now  been invited to some rules, those rules do not establish  that P.W. 1 was competent to grant the sanction in  question.

As per Rule 134 of the Indian Railway  Establishment Code, published in 1959, authorities  competent to make first appointment to non-gazetted  posts in the Indian Railways are the General Manager,  the Chief Administrative Officer or lower authority to  whom he may delegate power. There is no evidence to  show that this power has been delegated to the heads of  the department. No provision in the Indian Railway  Establishment Code, 1959 prescribing the authorities  competent to remove from office a class III officer was  brought to our notice. But the prefatory note to Vol. I of  the Code says, "The revised Chapter XVII and revised  Appendices I and XII will be printed later for inclusion in  this edition. Till such times these are printed, the rules

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and provisions contained in Chapter XVII and  Appendices IV and XVIII in the 1951 Edition (Re-print)  as amended from time to time shall continue to apply."

 In State of Karnataka through CBI vs. C. Nagarajaswamy  [(2005) 8 SCC 370], it was held :  

"Grant of proper sanction by a competent authority  is a sine qua non for taking cognizance of the offence. It  is desirable that the question as regard sanction may be  determined at an early stage."

       When a sanction is granted by a person not authorized in law, the  same being without jurisdiction, would be a nullity.  

       For the reasons aforementioned, we are of the opinion that the  impugned judgment need not be interfered with.  The appeal is, accordingly,  dismissed.