Research › Search › Judgment

Jharkhand High Court · body

2016 DIGILAW 272 (JHR)

Umesh Kumar v. State of Jharkhand

2016-02-05

R.R.PRASAD

body2016
ORDER : 1. This application has been filed for quashing of the entire criminal proceeding of Vigilance P.S. Case No. 02 of 2011 (Special Case No. 02 of 2011), including the order dated 26.8.2015 passed by the Special Judge, Vigilance, Ranchi, whereby and whereunder, cognizance of the offenses punishable under Sections 109, 409, 420, 467, 468, 471, 477A and 120B of Indian Penal Code as well as under Section 13(2) read with Sections 13(1)(c)(d) of the Prevention of Corruption Act has been taken against the petitioner. 2. Before adverting to the submissions advanced on behalf of the parties, the case of the prosecution as made out by the Vigilance needs to be taken notice of which is as follows:- “Jharkhand State Electricity Board issued Notice Inviting Tender (NIT) for undertaking work under the Accelerated Power Development and Reforms Programme (for short APDRP) under Package 'D' for Jamshedpur Town stipulating therein that the work would be targeted one which requires to be completed within time schedule and that the price quoted by the bidder shall not be subjected to variation on any account. Making it further clear that no escalation in prices shall be admissible on any account to the bidder. Same clauses were reiterated when the work orders were issued to M/s Ramji Power Company Limited (for short M/s RPCL) and even in the agreement entered into in between the JSEB and M/s RPCL they were part of the terms and conditions. M/s RPCL could not execute the work by the due date i.e. 26.9.2005. However, time was extended from 26.9.2005 to 31.7.2007 without putting any clause for escalation of price but with imposition of liquidated damages (L.D.). M/s RPCL agreed to that proposal and assured that the work will be completed within extended time and it will not be going for any arbitration. When it was found that M/s RPCL contrary to its promise did not even start the work by 31.7.2007, the then Chairman, JSEB directed the Chief Engineer, APDRP to put up agenda for termination of contract of M/s RPCL in the next meeting of the Board of JSEB. Accordingly, the Chief Engineer, APDRP put up the agenda to the then Member (Technical), JSEB, who in connivance with the other accused held back the concerned file till the transfer of the then Chairman, JSEB.” 3. Thereupon Mr. Accordingly, the Chief Engineer, APDRP put up the agenda to the then Member (Technical), JSEB, who in connivance with the other accused held back the concerned file till the transfer of the then Chairman, JSEB.” 3. Thereupon Mr. P.K. Sinha, the then Electrical Executive Engineer, APDRP, put note in the file for appointment of Arbitrator and for waiver of penalty after having approval of the Chairman. Thereupon, the Arbitrator was appointed who gave award. Pursuant to that, payments were made to the contractor-M/s RPCL. Thereupon, when it was detected that grave financial irregularities have been committed in making payments to M/s RPCL by adopting malpractices by the officers of the Board, FIR was lodged with the Vigilance alleging therein that the time extended upto July, 2007 had been granted to M/s RPCL but with stipulation that there should be no price escalation and that was subjected to imposition of L.D. In spite of that, when it was found that M/s RPCL has even not started the work, the then Chairman, JSEB asked the concerned officers to place the agenda in the next meeting of the Board for termination of contract but the officers of the Board having hatched conspiracy, never placed the agenda before the Board for termination of contract rather Mr. P.K. Sinha, Electrical Executive Engineer, APDRP, placed the file for appointment of an Arbitrator, waiver of penalty and extension of time. Thereupon, at the behest of said P.K. Sinha and other officers of the Board including the Director of Finance, an Arbitrator was appointed who gave award in favour of M/s RPCL and pursuant to that, the Board had to pay a sum of Rs. 10.87 Crores. That amount also included the amount on account of price variation but that was never the subject matter of dispute and, therefore, the Authority of the Board should have contested the award but the Authority of the Board without examining the merit of the award placed the file for approval of the award of the sole Arbitrator and then the then Chief Engineer, APDRP without examining the consequences of the award recommended for its approval by the Board. 4. It has further been alleged that Mr. P.K. Sinha with mala-fide intention, deliberately suppressed the fact that implementation of award will have financial impact of additional Rs. 4. It has further been alleged that Mr. P.K. Sinha with mala-fide intention, deliberately suppressed the fact that implementation of award will have financial impact of additional Rs. 11 Crores which amount is not available for making payment to the contractor and that additional fund could be arranged only after approval of the Ministry of Power, Government of India. Further allegation is that the file was moved for making payments of bill amounting to Rs. 7,89,84,826/- net value of Rs. 4,89,24,788/- which was paid after the order was passed by the Finance Controller-III though he had no authority to pass the order for making payment of a sum of Rs. Three Crores or above, rather the authority was either lying with the Member Finance or the Chairman, JSEB. Likewise payment of Rs. 2,75,43,156/- towards price variation was made from the account of project cost which is gross financial irregularities as that amount could have been paid only after making the fund available. 5. In the last, it has been alleged that the total cost of the project was Rs. 33.13 Crores. As against that, the work done including the cost of materials were worth Rs. 19,85,08,406/- but the contractor was paid a sum of Rs. 28,90,95,479/- and thereby a sum of Rs. 9,05,87,073/- has been paid in excess. The said FIR was lodged against number of officers of JSEB including this petitioner, who at the relevant point of time was the Finance Controller. 6. Upon the matter was taken up for investigation, the Investigating Officer did find culpability on the part of the petitioner and hence submitted charge-sheet against the accused persons including the petitioner. Thereupon, the court below took cognizance of the offenses punishable under Sections 109, 409, 420, 467, 468, 471, 477A and 120B of Indian Penal Code as well as under Section 13(2) read with Sections 13(1)(c)(d) of the Prevention of Corruption Act which is under challenge. 7. Mr. Indrajit Sinha, learned counsel appearing for the petitioner, submits that basic all two accusations have been made against the petitioner; first is related to the payment of a sum of Rs. 10,87,60,653/- which was paid to the contractor from the fund which was raised after taking loan from the Power Finance Corporation. 7. Mr. Indrajit Sinha, learned counsel appearing for the petitioner, submits that basic all two accusations have been made against the petitioner; first is related to the payment of a sum of Rs. 10,87,60,653/- which was paid to the contractor from the fund which was raised after taking loan from the Power Finance Corporation. The stand of the Vigilance is that the petitioner should not have made recommendation for making payment of that amount from the loan taken from Power Finance Corporation rather the Board should have taken a fresh loan for making payment of the said amount but since it has not been done and the payment has been made from the existing loan account, the petitioner is said to have committed financial irregularities but nowhere it is there that the payment of the outstanding dues cannot be made from the loan account and that the petitioner had to make payment for the reasons that the award had been passed in favour of the contractor where the aforesaid amount was supposed to be paid to him within the stipulated period and if the payment could not have been made, the Board would have been made liable to make payment of the amount of the interest @ 18% and that even the Board before payment was made had taken a resolution to implement the award which was passed in favour of the contractor and in that light, the petitioner made recommendation for making payment from the loan account which recommendation was accepted by the Chairman of the Board and thereby the petitioner did not commit any illegality. 8. Further allegation, which has been made against the petitioner, is that the petitioner against the bills of supply of the materials issued release order with respect to payment of a sum of Rs. 7,89,84,826/- corresponding to the net amount of Rs. 4,89,24,788/- without approval of the Chairman, as the petitioner had no authority to issue release order for making payment of a sum of Rs. Three Crores or above. 9. 7,89,84,826/- corresponding to the net amount of Rs. 4,89,24,788/- without approval of the Chairman, as the petitioner had no authority to issue release order for making payment of a sum of Rs. Three Crores or above. 9. In this regard, it is submitted that it is true that the petitioner without getting any prior approval from the Chairman did pass release order but by doing so he has simply violated the norms or code of the Board for which in absence of dishonest intention on the part of the petitioner to favour the contractor illegally, the petitioner cannot be said to have acted criminally. Moreover, after the release order was passed, post facto approval has been granted by the Chairman but that is not on the file rather on different sheets, factum of which gets semblance in the charge-sheet and thereby the petitioner even if has committed irregularities in making release order, he cannot be said to have committed any criminal act. 10. Learned counsel in this regard has referred to a decision rendered in a case of C. Chenga Reddy and Others vs. State of A.P. (1996) 10 SCC 193 . 11. Further submission, which was advanced on behalf of the petitioner, is that for prosecuting a person under Section 13(1)(d) read with 13(2) of the Prevention of Corruption Act, it is necessary that the act must have been done illegally abusing his position as public servant for obtaining benefit pecuniary or otherwise for himself or for someone else provided he does a conscious act to get the required result of pecuniary advantage or to obtain any valuable thing even if the act is for someone else, but here in absence of any material regarding connivance of the petitioner, it would never lead to presumption that there was dishonest act on the part of the petitioner and if it is so, no offence is made out under Section 13(1)(d) read with 13(2) of the Prevention of Corruption Act. 12. In support of the submission, learned counsel has referred to a decision rendered in a case of R. Balakrishna Pillai vs. State of Kerala, (2003) 9 SCC 700 . 13. Thus, it was submitted that if the prosecution of the petitioner is not quashed, there would be miscarriage of justice. 14. As against this, Mr. 12. In support of the submission, learned counsel has referred to a decision rendered in a case of R. Balakrishna Pillai vs. State of Kerala, (2003) 9 SCC 700 . 13. Thus, it was submitted that if the prosecution of the petitioner is not quashed, there would be miscarriage of justice. 14. As against this, Mr. T.N. Verma, learned counsel appearing for the Vigilance, submits that the petitioner being the Finance Controller did commit illegality in making payment of the aforesaid amount, that too without having any authority and thereby presumption can easily be drawn to have had bad intention on the part of the petitioner. 15. Learned counsel further submits that admittedly the petitioner before issuing release order with respect to payment against the bills raised against supply of materials prior approval of the Chairman has not taken and that everything was done hurriedly. In that event, culpability appears to be there on the part of the petitioner and hence the court below has rightly taken cognizance of the offences which never warrants to be interfered with. 16. Having heard learned counsel for the parties and on perusal of the records, I do find that nothing is there against the petitioner with respect to appointment of M/s RPCL nor anything is there in the matter of appointment of an Arbitrator. Only when award was given by the Arbitrator, the petitioner did make payment of the amount which had been awarded not from the working fund but from the loan fund. This has been taken by the Vigilance to be illegal as according to it the payment should not have been made from the existing loan amount, as the loan had never been taken for the purpose of making payment of the amount awarded by the Arbitrator. This accusation cannot be the subject matter of the prosecution in absence of anything being placed that there was restriction on the part of the authority of the Board to make payment of the amount covered under the award passed against the Board from the loan account. It is opinion of the Vigilance not based on any circular or guideline that the payment should have been made after having a fresh loan from the Power Finance Corporation. It is opinion of the Vigilance not based on any circular or guideline that the payment should have been made after having a fresh loan from the Power Finance Corporation. It be stated that the petitioner is to act according to his own wisdom and not as per the wishes of others and if nothing is there showing any culpability in the matter of payment of the amount, the petitioner cannot be said to have committed any wrong. 17. Coming further, it be stated that the petitioner passed release order with respect to payment of a sum of Rs. 4,89,24,788/- but that release order was passed without having any approval of the Chairman though such post facto approval according to the petitioner has been granted by the Chairman not on the file but on separate sheet which according to the Vigilance is bad but even if this irregularity is there in the matter of payment of the said amount, his culpability can only be found when something is more there showing his connivance or conspiracy with the contractor though the Vigilance has tried to establish that the file moved so fast but that never indicates about the culpability of the petitioner, as there may be conspiracy of other officials with the contractor on account of which the file moved so fast. Furthermore, it has never been the case of the vigilance that the aforesaid payments were made without the materials being supplied or short supplied. 18. Further, it be stated that the ingredients of the offence of criminal conspiracy are that there should be an agreement between the persons who are alleged to conspire and the said agreement should be for doing of an illegal act or for doing, by illegal means, an act which by itself may not be illegal. In other words, the essence of criminal conspiracy is an agreement to do an illegal act and such an agreement can be proved either by direct evidence or by circumstantial evidence or by both and it is a matter of common experience that direct evidence to prove conspiracy is rarely available. Accordingly, the circumstances proved before and after the occurrence have to be considered to decide about the complicity of the accused. Accordingly, the circumstances proved before and after the occurrence have to be considered to decide about the complicity of the accused. Even if some acts are proved to have been committed, it must be clear that they were so committed in pursuance of an agreement made between the accused persons who were parties to the alleged conspiracy. Inferences from such proved circumstances regarding the guilt may be drawn only when such circumstances are incapable of any other reasonable explanation. In other words, an offence of conspiracy cannot be deemed to have been established on mere suspicion and surmises or inference which are not supported by cogent and acceptable evidence. This proposition of law has been laid down by the Hon'ble Supreme Court in a case of Central Bureau of Investigation, Hyderabad vs. K. Narayana Rao, (2012) 9 SCC 512 . Here in the instant case, nothing appears to be there for showing connivance or conspiracy except aforesaid two facts which have been dealt with hereinabove regarding payment of the amount to the contractor. 19. Going further in the matter, it be stated that for prosecuting a person under Section 13(1)(d) read with 13(2) of the Prevention of Corruption Act, it is necessary that the act must have been done illegally abusing his position as public servant for obtaining benefit pecuniary or otherwise for himself or for someone else provided he does a conscious act to get the required result of pecuniary advantage or to obtain any valuable thing even if the act is for someone else. 20. This proposition has been laid down by the Hon'ble Supreme Court in a case of R. Balakrishna Pillai (supra). 21. Thus, any deviation from the settled procedure would never lead to presumption that there was dishonest act on the part of the petitioner and if it is so, no offence is made out under Section 13(1)(d) read with 13(2) of the Prevention of Corruption Act. 22. As I have said earlier that two acts are said to be culpable by the Vigilance are there but those acts related to deviation from the procedure only and that apart, nothing appears to be there showing any act of the petitioner leading to conclusion that the petitioner was also party to conspiracy hatched amongst others. 23. Thus, I do find that the trial court has committed illegality in taking cognizance vide its order dated 26.8.2015. 24. 23. Thus, I do find that the trial court has committed illegality in taking cognizance vide its order dated 26.8.2015. 24. Accordingly, the order dated 26.8.2015, including the entire criminal proceeding of Vigilance P.S. Case No. 02 of 2011 (Special Case No. 02 of 2011), taking cognizance against the petitioner, is hereby quashed. 25. In the result, this application stands allowed.