SFIO Not Barred From Investigating IPC Offences, Conducting 'Further Probe': Delhi High Court

The Delhi High Court has observed that the Serious Fraud Investigation Office (SFIO) is not barred from investigating offences under the Indian Penal Code, 1860, or conducting further investigation in accordance with law after the Investigation Report has been submitted.

“From a conjoint and harmonious reading of the relevant provisions of the CrPC and the present Act, as quoted hereinabove, it cannot be said that the SFIO is barred from investigating an offence under the IPC. SFIO is not barred from conducting a ̳further investigation' in accordance with law,” Justice Amit Sharma observed.

The court was dealing with a plea moved by various individuals seeking quashing of SFIO's Investigation Report titled “Investigation Report of Bhushan Power & Steel Limited & Others” and all the consequent proceedings emanating therefrom.

They also sought setting aside of a sanction issued by Union Ministry of Corporate Affairs last year granting sanction to SFIO for initiating prosecution against them. They also challenged SFIO's complaint as well as trial court's summoning order.

Dismissing the plea, Justice Sharma said that one of the petitioners, RK Gupta, being a key managerial personnel in terms of Section 2(51) of the Companies Act, 2013, would not need a separate approval for purposes of investigation in terms of Section 219(d) of the enactment.

“Since the complaint itself reflects that investigations were conducted with respect to the affairs of petitioner no. 2, the same would be covered under the provisions of Section 219 of the Act. However, the effect of not taking such prior approval would not ipso facto render the cognizance taken qua petitioner no. 2 by learned Special Court as invalid,” the court said.

Furthermore, the court observed that the investigation report within the scheme of the Companies Act will be treated as a police report, and thus, the officer filing the said report shall be considered an officer in charge of a police station, although the same is not specifically provided for in the enactment.

“If during course of investigation under the present Act, the concerned Investigating Officer comes across commission of offences punishable under the IPC or any other law relating to the transactions being investigated, then the same cannot give rise to distinct proceedings. Such investigation can be carried out under Section 4(1) of the CrPC,” the court said.

It added: “A conjoint reading of the aforesaid provisions of the CrPC and the present Act, it cannot be said that the SFIO is barred from investigating an offence under the IPC.”

Counsel for Petitioners: Mr. N. Hariharan, Senior Advocate with Ms. Ranjana Roy Gawai, Ms. Vashudha Sen, Mr. Vineet Wadhwa, Mr. Sharian Mukherji, Mr. Mueed Shah, Ms. Punya Rekha Angara and Mr. Prateek Bhalla, Advocates

Counsel for Respondents: Mr. Amit Tiwari, Senior Panel Counsel Mr. Chetanya Puri, Government Pleader; Mr. Nitin Agnihotri, Prosecutor for the SFIO with Mr. Shriram Tiwary, Mr. Salman Razi, Mr. Upanshu, Mr. Nitin Agnihotri, Advocates

Title: R.K. GUPTA & ORS. v. UNION OF INDIA THROUGH MINISTRY OF CORPORATE AFFAIRS & ANR.

Citation: 2023 LiveLaw (Del) 1339

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