[PC Act] Mere Negligence In Giving Legal Advice Sans Moral Delinquency Not Professional Misconduct: Kerala High Court Reiterates

The 7^th accused, a lawyer and advisor at Kerala Transport Development Finance Corporation Limited (KTDFC) was charged for criminal misconduct under Section 13(1)(d) read with Section 13(2) of the Prevention of Corruption Act (PC Act), Section 420 (cheating and dishonestly inducing delivery of property), Section 465 (punishment for forgery), Section 468 (forgery for cheating), Section 471 (using as genuine a forged document) and Section 120-B (punishment for criminal conspiracy) of the IPC. He approached the High Court against the order passed by the Special Judge dismissing his discharge under Section 239 CrPC.

While setting aside the order of the Special Judge and allowing the discharge, Justice K Babu stated thus:

“While considering the question of negligence on the part of a lawyer while giving legal opinion in a case where an offence under Section 109 read with Section 420 of IPC was charged against the lawyer in CBI v. K. Narayana Rao (supra) the Supreme Court following P.D. Khandekar v. Bar Council of Maharashtra, [(1984) 2 SCC 556] held that there is a world of difference between the giving of improper legal advice and the giving of wrong legal advice. Mere negligence unaccompanied by any moral delinquency on the part of a legal practitioner in the exercise of his profession does not amount to professional misconduct. The Supreme Court added that at the most, the lawyer may be liable for negligence if it is established by acceptable evidence and cannot be charged for the offences under Sections 420 and 109 IPC.”

BACKGROUND

The 7^th accused preferred this revision petition before the High Court. The 1^st accused was the managing director of KTDFC, 8^th accused was the husband of 1^st accused, and the 2^nd to 6^th accused were employees of KTDFC.

The allegation was that the 8^th accused along with the 1^st accused availed pecuniary advantage worth Rs.76,92,171 under the Aiswarya Griha Housing Finance Scheme of the KTDFC. It was alleged that their loan application was sanctioned because the petitioner gave a legal scrutiny certificate without verification of the documents and conspired with them even after knowing that they were not eligible for the loan.

The investigation was conducted by the Vigilance and Anti-Corruption Bureau, Thiruvananthapuram Unit and the case was pending before the Court of the Enquiry Commissioner and Special Judge, Thiruvananthapuram.

The Counsel for the petitioner submitted that the petitioner had only submitted an undated legal opinion at the request of the company months after the alleged commission of the offence. It was also argued that he could not be made part of a conspiracy after it was already committed and that there were no grounds to link him with any conspiracy.

On the other hand, the Government Pleader submitted that the petitioner did not verify original documents before submitting the legal opinion and that he had knowledge about the conspiracy.

OBSERVATIONS

Section 239 CrPC deals with discharge and Section 240 CrPC pertains to framing of charges.

Regarding framing of charges, the Court stated that there should be a prima facie case. Relying upon Sheoraj Singh Ahlawat and others v. State of Uttar Pradesh and another (2013), it stated thus, “while framing charges the Court is required to evaluate the materials and documents on record to decide whether the facts emerging therefrom taken at their face value would disclose existence of ingredients constituting the alleged offence. It was further held that the Court cannot speculate into the truthfulness or falsity of the allegations, contradictions and inconsistencies in the statement of witnesses at the stage of discharge.”

For discharge under Section 239, the Court stated that it has to consider whether the charges against the accused was groundless, without any legal evidence. It stated that Section 239 was not an empty or routine formality and that it benefits the accused. It stated that if the judge feels that there were 'grounds for presuming' that the accused has committed an offence, then there will be no discharge and charges would be framed against him. It thus concluded that there should a strong suspicion founded upon materials to form a presumption that the ingredients for the commission of the alleged offences were satisfied for framing charges.

Relying upon Apex Court decisions, the Court laid down conditions to be followed before proceedings to dismiss the charge and framing charges. The Court held thus:

1. while considering the question of framing charges, the Court has undoubted power to sift and weigh the evidence for the limited purpose of finding out whether or not a prima facie case against the accused has been made out.
2. Where the materials placed before the Court disclose grave suspicion against the accused, which has not been properly explained, the Court will be fully justified in framing a charge and proceeding with the trial
3. The test to determine a prima facie case would depend upon the facts of each case and it is difficult to lay down a rule of universal application.
4. Judge cannot act merely as a Post Office or a mouthpiece of the prosecution, but has to consider the broad probabilities of the case, the total effect of the evidence and the documents produced before it. Judge should note make a roving enquiry into the pros and cons of the matter and weigh the evidence as if he was conducting a trial.
5. If two views are possible and one of them gives rise to suspicion only, as distinguished from grave suspicion, the Trial Judge will be empowered to discharge the accused and at this stage, he is not to see whether the trial will end in conviction or acquittal.

In the facts of the case, the Court noted that the loan was sanctioned even before the legal scrutiny certificate was submitted wherein the petitioner has also mentioned that his legal opinion was subject to verification of original documents. It found that the legal scrutiny report submitted by the petitioner was prepared after the alleged commission of the crime. It noted that he had also advised the KTDFC to collect and accept original documents.

On the above findings and relying upon various Apex Court decisions, the Court stated that there was no criminal conspiracy. It noted that the petitioner had no knowledge regarding the commission of offences and that there were no meeting of minds.

It stated that there was no evidence against the petitioner to prove that he had conspired with the other accused for the commission of the alleged offence. It stated that mere conduct contrary to departmental norms and rules would not amount to criminal misconduct by a public servant under Section 13 of the PC Act.

“The Special Judge has not exercised his jurisdiction to see as to whether there is any basis for framing charges against the revision petitioner. This Court is of the firm view that the charges against the revision petitioner are groundless. There is patent error in the exercise of the jurisdiction by the Special Judge”, added the Court.

Accordingly, the Court allowed the petition and discharged the petitioner.

Counsel for appellant: Senior Advocate V Renjith Thampan, M.Krishnakumar, Maya M

Counsel for respondents: Special Government Pleader Raesh A, Senior Public Prosecutor Rekha

Citation: 2024 LiveLaw (Ker) 137

Case title: Vazhuthacaud R.Narendran Nair v State of Kerala

Case number: CRL.REV.PET NO. 484 OF 2023

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