Offence Executed In Chattisgarh But 'Prima Facie' Conspiracy Hatched Elsewhere, CBI Doesn't Need Prior Sanction From Chhattisgarh Govt: High Court

While hearing a plea against an order refusing to discharge the accused in a conspiracy case, the Chattisgarh High Court said that since the alleged offence was only "executed" in Chattisgarh, the investigating agency–CBI was not required to take previous sanction from the State Government under the Delhi Special Police Establishment Act. 

This, the court said after noting that the criminal conspiracy was "prima facie committed" in two other cities–Kolkata or New Delhi only.

A single judge bench of Justice Narendra Kumar Vyas in its judgment noted that Section 6 of the Delhi Special Police Establishment Act, 1946 (DPSE Act) is a component of "federalism" that provides for a "prior approval" of the State in case the Centre "wishes to transgress" in the State's territory and usurp the powers of the police force of the State.

"Thus, the provision of Section 6 therefore, assumes immense significance and therefore, cannot be ignored and violated by anyone. From bare perusal of Section 6 of the Act, it is quite vivid that the CBI does not have any inherent jurisdiction in any area in the State including Railway," the court said. 

With respect to the case before it the high court however said, "Considering all the facts and material placed on record which clearly establish that the offence of conspiracy was committed at Kolkata and Delhi and in Chhattisgarh, the loan amount which has been received after doing conspiracy was utilized at Chhattisgarh which does not give any right to the accused to seek quashment of the proceedings on the count that no approval of the State Government has been obtained".

Background

The High Court was hearing the petitioner's revision plea against a Special Court's decision refusing to discharge the petitioner for offences punishable under IPC Sections 120-B (criminal conspiracy) & 420 (cheating) and Sections 13(1)(d) read with 13 (2) of the Prevention of Corruption Act and had fixed the matter for prosecution evidence. 

In the present case, it was alleged that the Petitioner along with another person had hatched the "criminal conspiracy" at Kolkata to cause "undue pecuniary gain" to themselves and wrongful loss to HUDCO, and in pursuance of criminal conspiracy, Rs. 24.50 crore was sanctioned by HUDCO Board at New Delhi to the company wherein the petitioner was a director, to stall a captive power plant (CPP).

The sanctioned loan amount was utilized in Chhattisgarh as part of the continuing offence, therefore the petitioner claimed that failure of the CBI to take the previous sanction of the Chhattisgarh Government before filing a charge sheet before the Special Court would be bad in law.

The CBI on the other hand referred to the court's division bench's decision in B.L. Agrawal vs. CBI and others ( 2019) and the Delhi High Court's 2018 decision in Anand Agrawal vs. UOI to contend, that it has been already held that  "criminal conspiracy is a continuing offence and merely because some of the acts of criminal conspiracy were performed by the accused in the State of Chhattisgarh, for that CBI has no necessity to seek prior permission of that State Government". 

The issue before the high court's consideration was whether for initiation of prosecution, sanction of the Chhattisgarh Government is necessary when the offence of conspiracy was committed at Kolkata and Delhi for stalling the Plant at Raigarh, Chhattisgarh.

Findings

Affirming the Special Court's order, the high court accepted the CBI's contention and noted that utilization of the sanctioned loan amount in Chhattisgarh would not require the State Government's permission before filing the charge sheet against the Petitioner.

“From the bare perusal of the case diary submitted by the CBI, it is quite vivid that the applicant has submitted an application for sanctioning of the loan at Kolkata and the same was sent to Delhi before the Director of HUDCO where the loan was sanctioned and the loan was sanctioned for stalling captive power plant at Cherapani, Raigarh which is situated at Chhattisgarh. Thus, the offence of conspiracy was initiated at Kolkata and thereafter, the loan was sanctioned at New Delhi and the fund was said to have been utilized at Chhattisgarh therefore, the conspiracy was committed at Kolkata where it has been alleged that the applicant has submitted an application for sanction of loan and thereafter, the loan was sanctioned at New Delhi. Thus, the part of the offence of Chhattisgarh is only execution of the offence by utilizing the fund. Thus, the criminal conspiracy was prima facie committed at Kolkata or New Delhi only.”

The high court further noted that the loan was sanctioned at New Delhi after getting the documents from HUDCO's Kolkata office and the FIR was registered at Delhi. The charge sheet was also filed at New Delhi, the court noted. 

It thereafter said, "As such, the sanction of the Government of Chhattisgarh is not required as provisions of Section 6 of the Act, 1946 are not applicable to the present facts and circumstances of the case". 

In view of the legal position, the high court was of the view that the revision plea was devoid of merit and went on to dismiss the same.

It however made it clear that it has not commented on the merits of the allegations made against the petitioner adding that the trial Court is free to proceed in accordance with law on the basis of evidence and the material collected during the trial without being influenced by observations made by the high court. 

Case Title: Sunil Kumar Mall vs. Central Bureau Of Investigation & Anr., CRR No. 138 of 2021

Counsel for Petitioner : Advocates BP Sharma, Vaibhav Tiwari and Anuja Sharma

Counsel for CBI : Advocate Vaibhav A Goverdhan

Counsel for State: Dy. Advocate General UKS Chandel  

Click here to read/download the order