Cbi Vs. Sashi Balasubramanian & Anr  Insc 721 (31 October 2006)
Sinha & Dalveer Bhandari
out of SLP (Crl..) No.996 of 2006] S.B. SINHA, J.
and/or application of the Kar Vivad Samadhan Scheme 1998 framed under
the Finance (No.2) Act, 1998 is in question in this appeal which arises out of
a judgment and order dated 20.01.2005 passed by the High Court of Madras in Crl.OP
Nos.31422 and 36254 of 2004.
of all unnecessary details, the fact of the matter is as under :
M/s Best Fabrics (for short, the Company) had applied for an advance licence
on 29.01.1993 from the Office of the Joint Director General of Foreign Trade,
Chennai for import of cotton fabrics showing the export order for 47136 sets of
cotton mens ensemble under the Duty Exemption Entitlement
Certificate (for short, the Scheme). Upon scrutiny the
application, a recommendation, however, was made to allow the said company to
import cotton fabrics of 44 inch widths. As the item was not figuring
in the standard input and output norms book, the file was placed before
Respondent No. 1, Smt. Sashi Balasubramanian, by Sri V. Rajpriyan, Respondent
No. 2 herein, for placing before the Zonal Advance Licensing Committee for
recommendations as regards quantity and description of the goods to be allowed
for advance licence was granted by Smt. Sashi Balasubramanian. On allegations
in regard to the grant of the said licence, a First Information Report was
lodged on 02.03.1995 for commission of offences under Sections 120-B, 420 and
471 of the Indian Penal Code, Section 13(2) read with Section 13(1)(d) of the
Prevention of Corruption Act, 1988 and Section 136 of the Customs Act, 1962.
Company and its Directors, however, in the meanwhile filed an application in
terms of the Scheme.
were filed on 31.12.1998. The charge-sheet in the criminal case was filed on
there were seven accused; three out of them were the private parties, namely,
M/s Best Fabrics, Shri S. Vaidyanathan and Shri Bharath Bhushan Goyal. Smt. Sashi
Balasubramanian, Respondent No.1 herein, was the Deputy Director General of
Foreign Trade and Shri V. Rajpriyan , Respondent No.2 herein, was the Controller
of Exports and Imports. Apart from Respondents herein, two other officials were
also arrayed as accused persons in the charge- sheet, namely, Shri S. Ramanathan,
Assistant Collector and Shri A. Sivaram Kumar, Apprising Officer.
Nos. 1 to 4 filed an application for quashing the criminal proceedings as
against them before the High Court of Madras, which was registered as CC No. 34
stated that by an order dated 29.04.2004, the said application has been
allowed. No appeal is said to have preferred therefrom.
thereafter filed an application before the High Court with the self-same
prayer, which by reason of the impugned judgment has been allowed.
is, thus, before us.
Singh, the learned Additional Solicitor General appearing on behalf Appellant urged
Having regard to the nature of the Scheme, the High Court committed a manifest
error in opining that as the private parties became entitled to immunity from
prosecution, the official respondents would also be covered thereby.
The High Court misconstrued and misinterpreted the provisions of Section 95
(iii) of the Act.
Public Servants were not entitled to any relief under the said Scheme and far
less immunity from prosecution.
Manish Singhvi and Mr. T. Raja, the learned counsel appearing on behalf of
Respondents, on the other hand submitted :
The High Court cannot be said to have acted illegally and without jurisdiction,
as Respondents herein were also entitled to the benefit of immunity scheme.
The doctrine of parity is applicable in the instant case, and, thus, as other
accused similarly situated had been held to be entitled to the benefit of
declaration dated 31.12.1998 made under the Scheme, there is no reason as to why
Respondents would not be entitled thereto.
Section 95 of the Act cannot be invoked for the said offence and in that view
of the matter, it is impermissible in law to split up the offences between
private parties and the public servants, particularly when charges had been
framed under Section 120-B of the Indian Penal Code.
As the charges formed part of the same transaction, either all the persons
involved therein may be proceeded against or none at all.
Section 95(iii) of the Act, as the High Court has rightly opined, must be held
to be inapplicable in the facts and circumstances of the case.
In any event, even if the allegations made against Respondents are taken to be
correct and accepted in its entirety, the same does not constitute any offence
as alleged or at all.
additional submission was made by Mr. T. Raja that his client having worked
under the orders of Smt. Sashi Balasubramanian, cannot be said to have
committed any offence at all.
Parliament enacted the Finance Act, 1998. It came into force with effect from
29.03.1998. Chapter IV of the said Act provides for the Kar Vivad Samadhan
came into force with effect from the 1st day of September, 1998.
has been defined in Section 87(a) to mean a person making a declaration under
Section 88. Disputed tax has been defined in Section 87(f) to mean
the total tax determined and payable, in respect of an assessment year under
any direct tax enactment but which remains unpaid as on the date of making the
declaration under Section 88.
tax enactment has been defined in Section 87(j) in the following terms :
indirect tax enactment means the Customs Act, 1962 (52 of 1962) or
the Central Excise Act, 1944 (1 of 1944) or the Customs Tariff Act, 1975 (51 of
1975) or the Central Excise Tariff Act, 1985 (5 of 1986) or the relevant Act
and includes the rules or regulations made under such enactment; Section
87(k) of the Act defines the person to mean :
Hindu undivided family,
association of persons or a body of individuals, whether incorporated or not,
artificial juridical person, not falling within any of the preceding
assessee, as defined in rule 2 of the Central Excise Rules, 1944;
as defined in clause (20) of section 2 of the Customs Act, 1962 (52 of 1962);
as defined in clause (26) of section 2 of the Customs Act, 1962 (52) of 1962);
person against whom proceedings have been initiated and are pending under any
direct tax enactment or indirect tax enactment. Section 88, inter alia, provides
Subject to the provisions of this Scheme, where any person makes, on or after
the 1st day of September, 1998 but on or before the 31st day of December,
19998, a declaration to the designated authority in accordance with the
provisions of section 89 in respect of tax arrear, then, notwithstanding anything
contained in any direct tax enactment or indirect tax enactment or any other
provision of any law for the time being in force, the amount payable under this
Scheme by the declarant shall be determined at the rates specified hereunder,
the tax arrears is payable under the indirect tax enactment –
a case where the tax arrear comprises fine, penalty or interest but does not
include duties (including drawback of duty, credit of duty or any amount
representing duty) or cesses, at the rate of fifty per cent, of the amount of
such fine, penalty or interest, due or interest, due or payable as on the date
of making a declaration under section 88,
in any other case, at the rate of fifty per cent, of the amount of duties (including
drawback of duty, credit of duty or any amount representing duty) or cess due
or payable on the date of making a declaration under section 88. A
declaration is required to be filed in the form prescribed therefor. Time and
manner of payment of tax arrears is provided for in Section 90. Section 91
provides for immunity from prosecution and imposition of penalty in certain
cases. Section 95 provides for exceptions as regards the applicability of the
Scheme, Clause (iii) whereof, which is relevant for our purpose, reads as under
The provisions of this Section shall not apply (iii) to any person in
respect of whom prosecution for any offence punishable under Chapter IX or
Chapter XVII of the Indian Penal Code (45 of 1860), the Foreign Exchange
Regulation Act, 1973 (46 of 1973), the Narcotic Drugs and Psychotropic
Substances Act, 1985 (61 of 1985), the Terrorists and Disruptive Activities
(Prevention) Act, 1987 (28 of 1987), the Prevention of Corruption Act, 1988 (49
of 1988), or for the purpose of enforcement of any civil liability has been
instituted on or before the filing of the declaration or such person has been
convicted of any such offence punishable under any such enactment. The
principal questions which arise for consideration are
Whether the Scheme is applicable in relation to a public servant ?
When does a prosecution start ?;
Whether the offences enumerated under Section 95(iii) are excluded from
immunity in terms of Section 91 of the Act ? The Scheme provides for an
exception to the general law. It provides for the mode and manner in which the
arrears of tax was to be collected. It dealt with direct and indirect taxes
only. Ex facie public servants would not come within the purview of
for Respondents, however, suggest that public servants would also come within
the purview of the Act as against them also proceedings had been initiated.
2(k)(xi), while defining a person undoubtedly embraces within its fold those
against whom proceedings have been initiated, but the same relate to direct or
indirect tax enactments. Proceedings contemplated under the Act must have a
nexus with arrears of tax. Public servants who can never file a declaration
would not, in our considered view, come within the purview thereof.
course, there exists a distinction between a person and a declarant.
However, declaration is to be filed by a person who would come within the
purview of the said term, as has been stated in the interpretation clause
contained in Section 2(k) of the Act. Section 88 provides for a declaration to
be made by a person and, declarant means a person making a
declaration. The applicability of the provisions of the Act must be judged in
the aforesaid context.
definition of person must be read having regard to term declarant
i.e. who files a declaration.
public servant is enjoined with a duty to enforce tax enactments. A declaration
in terms of Section 88 can be filed by a declarant for determination of the tax
arrear under the Scheme at the rates specified thereunder. Public servants,
therefore, cannot not take the benefit of the scheme. Section 90 provides for
the time and manner of payment of tax arrear. The amount of arrear of tax is
required to be determined within a period of sixty days from the date of
receipt of the declaration under Section 91, whereupon a certificate is to be
granted in such form as may be prescribed. The certificate is granted only to
the declarant, which would contain the particulars of tax arrears and the sum
payable after such determination towards full and final settlement of tax
immunity under the scheme is an not absolute one.
designated authority may impose certain conditions while making an inquiry
contained in Section 90.
immunity granted is subject to the conditions provided in Section 90. The
immunity is in relation to institution of any proceeding for prosecution for
any offence. Such offence may be either under the direct tax enactment or
indirect enactment. Immunity is also granted from imposition of penalty under
such enactments. However, immunity also extends to matters covered under the
declaration under Section 88. Section 95 provides for an exception to the
Scheme. Once the provisions of Section 95 are attracted, the Scheme shall not
apply. A determination might have been made although the Scheme was not
applied, but the same may not per se confer a right of obtaining any immunity
in terms of Section 91 of the Act. Clause (iii) of Section 95 while laying down
the exceptions, enumerates offences under Chapter IX or Chapter XVII of the IPC
and certain other statutes. It also makes an exception, if a proceeding for
enforcement of any civil liability has been instituted. Clause (iii) of Section
95 would be attracted if, inter alia, any prosecution for any offence
enumerated thereunder has been instituted on or before the filing of the
First Information Report in regard to the offences committed, as indicated
hereinbefore, was lodged on 02.03.1995. The investigation started immediately
thereafter. The investigation was being carried on by the Central Bureau of
Investigation (Economic Offences Wing).
at a much later stage, namely, more than three years thereafter, i.e. on
31.12.1998, declarations were filed. Charge-sheet in the criminal case was
filed on 12.04.1999.
in the aforementioned context, interpretation of the word prosecution
assumes significance. The term prosecution would include institution
or commencement of a criminal proceeding. It may include also an inquiry or
investigation. The terms prosecution and cognizance are not
interchangeable. They carry different meanings.
statutes provide for grant of sanction at different stages.
initio means in the beginning. The dictionary meaning of
initiation is cause to begin. Whereas some statutes provide for grant
of sanction before a prosecution is initiated, some others postulate grant of
sanction before a cognizance is taken by Court. However, meaning of the word
may vary from case to case. In its wider sense, the prosecution means a
proceeding by way of indictment or information, and is not necessarily confined
to prosecution for an offence.
term prosecution has been instituted would not mean when charge-sheet
has been filed and cognizance has been taken. It must be given its ordinary
Legislature with a definite purpose thought of granting an exemption from the
operation of the Act, if no prosecution is initiated under the provisions of
the statute specified thereunder. Chapter IX of the Penal Code deals with
public servants. Chapter XVII thereof deals with offences relating to property.
Offences under other enactments are of serious nature. Thus, presumably commission
of offences under the other Acts enumerated therein were considered to be
serious enough by the Parliament, so as to exclude the application of the
Scheme, which includes Prevention of Corruption Act.
view of the matter, an immunity is granted only in respect of offences
purported to have been committed under direct tax enactment or indirect tax
enactment, but by no stretch of imagination, the same would be granted in
respect of offences under the Prevention of Corruption Act. A person may commit
several offences under different Acts; immunity granted in relation to one Act
would not mean that immunity granted would automatically extend to others. By
way of example , we may notice that a person may be prosecuted for commission
of an offence in relation to property under the Indian Penal Code as also under
another Act, say for example, the Prevention of Corruption Act.
charges under the Prevention of Corruption Act may fail, no sanction having
been accorded therefor, the charges under the Penal Code would not.
High Court has not held that the offences alleged against Respondents are so
inextricably connected that it cannot be separated so much so that in the event
if it be held that private parties cannot be proceeded with at all, the case
against public servants, would invariably fail.
thus, as at present advised, do not intend to delve deep into the said
question. However, to be fair to learned counsel, we may notice the decisions
cited at the bar.
placed by Mr. Singhvi on Devarapalli Lakshminarayana Reddy and Others v. V. Narayana
Reddy and Others [(1976) 3 SCC 252] has no application to the facts and
circumstances of the present case. The question which arose for consideration
therein was required to be determined in the context of the provisions of
Sections 200 and 202 of the 1898 Code vis-`-vis Sections 200 and 202 of the
1973 Code. The question was as to whether cognizance is taken before issuance
of process or not. It in that context, it was stated :
This raises the incidental question: What is meant by taking cognizance of
an offence by a Magistrate within the contemplation of Section 190? This
expression has not been defined in the Code. But from the scheme of the Code,
the content and marginal heading of Section 190 and the caption of Chapter XIV
under which Sections 190 to 199 occur, it is clear that a case can be said to
be instituted in a court only when the court takes cognizance of the offence
alleged therein. The ways in which such cognizance can be taken are set out in
clauses (a), (b) and (c) of Section 190(1).
the Magistrate has or has not taken cognizance of the offence will depend on
the circumstances of the particular case including the mode in which the case
is sought to be instituted, and the nature of the preliminary action, if any,
taken by the Magistrate. Broadly speaking, when on receiving a complaint, the
Magistrate applies his mind for the purposes of proceeding under Section 200
and the succeeding sections in Chapter XV to the Code of 1973, he is said to have
taken cognizance of the offence within the meaning to Section 190(l)(a). It,
instead of proceeding under Chapter XV, he has, in the judicial exercise of his
discretion, taken action of some other kind, such as issuing a search warrant
for the purpose of investigation, or ordering investigation by the police under
Section 156(3), he cannot be said to have taken cognizance of any offence.
Institution of a prosecution and institution of a complaint case in a criminal
court stand on different footings. Whereas summons to an accused in a complaint
case can be issued only upon taking cognizance of the offence, the same would
not mean in a case where first information report has been lodged resulting in
initiation of investigation or where it has been referred to police or other
authorities for enquiry; even then a prosecution may not be held to have been
initiated at that stage.
transpires from the said decision is that whereas before cognizance is taken,
application of mind on the part of the court is imperative, taking action of
some other kind would not mean that cognizance has been taken. In some cases,
even after lodging of the F.I.R., a preliminary enquiry which may not be an
investigation into the crime, may be initiated.
reliance has also been placed on Basir-ul-Haq and Others v. State of West Bengal [(1953) SCR 836]. The question
which arose for consideration therein was whether having regard to the nature
of the offence allegedly committed by the accused named therein, it was capable
to be split up. In the aforementioned context, it was held that if the offences
are inseparable or incapable of being split up, the Court will have no other
option but to pass a judgment of acquittal, stating :
Though, in our judgment, Section 195 does not bar the trial of an accused
person for a distinct offence disclosed by the same facts and which is not
included within the ambit of that section, it has also to be borne in mind that
the provisions of that section cannot be evaded by resorting to devices or
camouflages. The test whether there is evasion of the section or not is whether
the facts disclose primarily and essentially an offence for which a complaint
of the court or of the public servant is required. In other words, the
provisions of the section cannot be evaded by the device of charging a person
with an offence to which that section does not apply and then convicting him of
an offence to which it does, upon the ground that such latter offence is a
minor offence of the same character, or by describing the offence as being one
punishable under some other section of the Indian Penal Code, though in truth
and substance the offence falls in the category of sections mentioned in
Section 195 of the Criminal Procedure Code. [Emphasis supplied] The observations
in the said judgment must be held to have been made in the factual matrix
obtaining therein and not dehors the same.
instant case, resorting to any device or camouflage has not been alleged. It is
also not a case that the provisions of the Indian Penal Code or the Prevention
of Corruption Act cannot be said to have any application, although linked with
an offence under Section 136 of the Customs Act.
ultimate purpose of commission of an offence may be to commit one offence under
one statute, but indisputably in the process thereof offences under other
statutes may also be committed.
Lal Hari Lal Bhagwati v. CBI, New Delhi
[(2003) 5 SCC 257] this Court indisputably proceeded to hold that the immunity
was qua offence but Appellants therein before this Court were the assessees.
The prosecution was also launched therein after a declaration was made.
also notice that Brijesh Kumar, J. in his concurring but separate judgment took
into consideration the fact situation obtaining therein, namely, initiation of
a criminal proceeding after issuance of a declaration and after withdrawal of
the case, in the High Court in the following terms :
the one hand final settlement was made after determining the tax liability on
the premise that the appellants were neither convicted nor criminal proceedings
were pending, relating to any offence under Chapter IX or XVII IPC, yet the
criminal proceedings are being prosecuted which is apparently against the very
spirit of the Scheme promulgated under the Finance (No. 2) Act of 1998. If a
person against whom criminal proceedings were pending, relating to offence
under Chapter IX or XVII IPC or who stood convicted under any of the provisions
of those chapters, he would not have been eligible to seek benefit under the
Scheme and after accepting that position and the due settlement, there was no
occasion to initiate and continue the criminal proceedings, which could bring
about the conviction of the same persons, in case prosecution ended successfully
in favour of the State and against the appellants. If such a condition is
provided that on a particular date a criminal proceeding should not be pending
against a person nor should he have been convicted of an offence, as a
condition precedent for a settlement, and on that basis a settlement is brought
about, it does not mean that later on, one could turn around and get the declarant
convicted for a criminal offence too, after settlement of the liability. More
so, when in view of Section 90 sub-section (4) of the Scheme the declarant is
obliged to withdraw an appeal or proceedings regarding tax liability pending
before the High Court or the Supreme Court, which had also been done in the
case in hand.
is to say that on one hand the declarant is not permitted to pursue the remedy,
regarding tax liability, which is already pending before the courts of law, as
they are either deemed to be withdrawn by operation of law or they have to be
withdrawn by a positive act of the party and yet prosecute such persons for
their conviction as well.
could not be dragged and chased in criminal proceedings after closing the other
opening making it a dead end. It is highly unreasonable and arbitrary to do so
and initiation and continuance of such proceedings lack bona fides. An
accused may be discharged from a criminal case under Section 245 of the Code,
if his civil liability has been determined in his favour; but the same must
have a direct nexus with his criminal liability. He would not acquire any
immunity only because civil and criminal liabilities have some connection,
however, remote the same may be.
connection between the two types of liabilities must be direct and proximate.
If in incurring the civil liability, he has committed offences wherewith
determination thereof has no nexus, the immunity would not extend thereto.
will give a simple example. A person while obtaining undue favour from an
authority under the indirect tax enactment, offers a bribe. Obtaining of an
undue favour resulting in prosecution under the indirect tax enactment may be a
separate offence , but involvement of the public servant qua offences under the
Prevention of Corruption Act would be a separate and distinct one.
one thing to say that an Act constitutes both civil and criminal wrong and in
the self same fact, when compounding of offence is effected in relation to the
civil dispute, the High Court may be justified in quashing a complaint under
the criminal case as was done in Central Bureau of Investigation, SPE, SIU (X),
New Delhi v. Duncans Agro Industries Ltd., Calcutta [(1996) 5 SCC 591], but it
is another thing to say that prosecution under other statute would also fail.
It is in that view of the matter, this Court stated the law in the following terms
After giving our careful consideration to the facts and circumstances of the
case and the submissions made by the respective counsel for the parties, it
appears to us that for the purpose of quashing the complaint, it is necessary
to consider whether the allegations in the complaint prima facie make out an
offence or not. It is not necessary to scrutinise the allegations for the
purpose of deciding whether such allegations are likely to be upheld in the
trial. Any action by way of quashing the complaint is an action to be taken at
the threshold before evidences are led in support of the complaint. For
quashing the complaint by way of action at the threshold, it is, therefore,
necessary to consider whether on the face of the allegations, a criminal offence
is constituted or not. Reliance has also been placed on K.C. Builders and
Another v. Assistant Commissioner of Income Tax [(2004) 2 SCC 731]. The
question which arose for consideration therein was as to whether mens rea is an
essential ingredient for imposition of penalty under Section 271(1)(c) of the
Income Tax Act. In that case, finding of concealment and subsequent levy of
penalties had been struck down by the Tribunal. The assessment year was
directed to be corrected in terms of Section 154 of the Act. It was in that
fact situation, this Court opined that if the Tribunal has set aside the order
of imposing a penalty for concealment, there would be no concealment in the
eyes of the law and, therefore, the prosecution should be proceeded against the
accused and, thus, further proceedings would be illegal and without
jurisdiction, stating :
the Tribunal has set aside the levy of penalty, the criminal proceedings
against the appellants cannot survive for further consideration In the
fact of that case, it was held that the charge of conspiracy had not been
proved and no case had also been made out for establishing the offence of
cheating. The gist of the prosecution case therein was that the accused had
filed false returns of income before the Department which led concealment of
income to evade tax. The question, therefore, was as to whether there had been
any concealment of income at all. The said decision, therefore, cannot have any
has also been placed on Central Bureau of Investigation v. Akhilesh Singh
[(2005) 1 SCC 478]. In that case, out of the three accused, two were discharged
and in that view of the matter it was held that the basis of alleged conspiracy
by the respondent therein with Dr. Sanjay Singh lost its substratum. It was in
the factual matrix of the case exercise of jurisdiction by the High Court under
Section 482 of the Code of Criminal Procedure was held to be not to be
suffering from any illegality or infirmity.
may, however, notice that in R.K. Garg etc. v. Union of India and Others
[(1981) 4 SCC 675], it was held that only because exemption had been granted in
relation to purchase of bearer bonds, the same would not mean that the offender
shall stand immuned from other offences also.
J. speaking for the majority opined :
will be seen that the immunities granted under Section 3, sub-section (1) are
very limited in scope. They do not protect the holder of Special Bearer Bonds
from any inquiry or investigation into concealed income which could have been
made if he had not subscribed to or acquired Special Bearer Bonds. There is no
immunity from taxation given to the black money which may be invested in
Special Bearer Bonds. That money remains subject to tax with all consequential
penalties, if it can be discovered independently of the fact of subscription to
or acquisition of Special Bearer Bonds. The only protection given by Section 3,
sub- section (1) is that the fact of subscription to or acquisition of Special
Bearer Bonds shall be ignored altogether and shall not be relied upon as
evidence showing possession of undisclosed money. This provision relegates the
Revenue to the position as if Special Bearer Bonds had not been purchased at
without taking into account the fact of subscription to or acquisition of
Special Bearer Bonds and totally ignoring it as if it were non-existent, any
inquiry or investigation into concealed income could be carried out and such
income detected and unearthed, it would be open to the Revenue to do so and it
would be no answer for the assessee to say that this money has been invested by
him in Special Bearer Bonds and it is therefore exempt from tax or that he is
on that account not liable to prosecution and penalty for concealment of such
income. This is the main difference between the impugned Act and the Taxation
Laws (Amendment and Miscellaneous Provisions) Act, 1965. Under the latter Act,
where gold is acquired by a person out of his undisclosed income, which is the
same thing as black money, and such gold is tendered by him as subscription for
the National Defence Gold Bonds, 1980, the income invested in such gold is
exempted from tax, but where Special Bearer Bonds are purchased out of
undisclosed income under the impugned Act, the income invested in the Special
Bearer Bonds is not exempt from tax and if independently of the fact of
purchase of the Special Bearer Bonds and ignoring them altogether, such income
can be detected, it would be subject to tax. The entire machinery of the taxation
laws for inquiry and investigation into concealed income is thus left untouched
and no protection is granted to a person in respect of his concealed income
merely because he has invested such income in Special Bearer Bonds. It is
therefore incorrect to say that as soon as any person purchases Special Bearer
Bonds, he is immunised against the processes of taxation laws. Here there is no
amnesty granted in respect of any part of the concealed income even though it be
invested in Special Bearer Bonds. The whole object of the impugned Act is to
induce those having black money to convert it into white money by making it
available to the State for productive purposes, without granting in return any
immunity in respect of such black money, if it could be detected through the
ordinary processes of taxation laws without taking into account the fact of
purchase of Special Bearer Bonds. We may at this stage deal with another
contention viz. that if in the connected matter where other public servants
were parties, , no appeal having been filed from the judgment of the High Court
by the C.B.I., this appeal would be maintainable. This aspect of the matter has
been considered by a three-Judge Bench of this Court in Government of West
Bengal v. Tarun K. Roy and Others [(2004) 1 SCC 347], wherein it was
categorically stated :
of an appeal, in any event, would not be a ground for refusing to consider a
matter on its own merits. (See State of Maharashtra v. Digambar10.)
State of Bihar v. Ramdeo Yadav11 wherein this Court noticed Debdas Kumar1 by
holding: (SCC p. 494, para 4) 4. Shri B.B. Singh, the learned counsel for
the appellants, contended that though an appeal against the earlier order of
the High Court has not been filed, since larger public interest is involved in
the interpretation given by the High Court following its earlier judgment, the
matter requires consideration by this Court. We find force in this contention. In
the similar circumstances, this Court in State of Maharashtra v. Digambar10 and in State of W.B.
v. Debdas Kumar1 had held that though an appeal was not filed against an
earlier order, when public interest is involved in interpretation of law, the
Court is entitled to go into the question. [See also Union of India v. Pramod
Gupta (Dead) by Lrs. and Others (2005) 12 SCC 1] In this case also public
interest is involved as interpretation of the provisions of the Act were in
question. Yet again there cannot be any equality in illegality.
Secretary, State of Karnataka and Others v. Umadevi (3) and Others
[(2006) 4 SCC 1] We, therefore, are of the opinion that the impugned judgment
cannot be sustained. It is set aside accordingly.
High Court, however, did not go into the merit of the matter. It proceeded on
the basis that the continuation of the prosecution as against Respondents was
unsustainable in law. Although prosecution as against Respondents herein may be
held to be not maintainable, in our opinion, they are entitled to contend that
even if the materials brought on records are given face value and taken to be
correct in their entirety, no case has been made out as against them.
appeal is allowed, the impugned judgment is set aside with the aforementioned
observations. No costs.