Full Judgment Text
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CASE NO.:
Appeal (crl.) 1032 of 2004
PETITIONER:
Dipesh Chandak
RESPONDENT:
Union of India
DATE OF JUDGMENT: 17/09/2004
BENCH:
S. N. Variava & A. K. Mathur
JUDGMENT:
J U D G M E N T
(Arising out of SLP (Crl.) No. 2740 of 2002)
S. N. VARIAVA, J.
Leave granted.
This Appeal is against the Judgment of the High Court of
Patna dated 21st March, 2002.
Briefly stated the facts are as follows:
The Appellant is an accused in a number of cases pertaining to the
Fodder Scam in the Animal Husbandry Department of Bihar. He has,
along with others, been accused of misappropriation of the funds of
the Animal Husbandry Department and of fraudulent withdrawals from
the State Exchequer by issuing fake bills for supplies never made to
the Animal Husbandry Department. The Appellant has been, on 28th
August, 1998, granted a pardon by the Special Judge, CBI, on the
condition that he makes a full and complete disclosure.
On the basis of the statement made by the Appellant, the
Deputy Commissioner of Income Tax, Central Circle-I, Patna, issued a
show-cause-notice to the Appellant as to why prosecution should not
be initiated against him, under Sections 277 and 278 of the Income
Tax Act, for having filed false returns of income tax. The Appellant
replied to the show-cause-notices, inter alia, stating that he has been
granted a pardon under Section 306 of the Criminal Procedure Code
and thus the show-cause-notice was not maintainable for an offence
under Sections 277 and 278 of the Income Tax Act. This contention
was not accepted by the Commissioner of Income Tax, who opined
that the pardon was restricted only to offences under the Indian Penal
Code. Accordingly, a Complaint Case No. 157(C)/2000 has been
registered under Sections 277 and 278 of the Income Tax Act. The
Court of Economic Offences, Patna, has taken cognizance and issued
summons.
The Appellant filed a Petition under Section 482 of the
Criminal Procedure Code for quashing this complaint. By the
impugned Judgment that Petition has been dismissed, inter alia, on
the ground that as yet the terms of the pardon have not been fulfilled.
It is held that till full evidence is given by the Appellant and the trial of
all cases is concluded he continues to be an accused and, therefore,
cannot claim immunity from prosecution.
Mr. Lahoty, on behalf of the Appellant, submitted that the
Appellant has been granted pardon under Section 306 of the Criminal
Procedure Code. He submitted that under sub-section 2 of Section
306 the pardon is, amongst others, in respect of any offence
punishable with imprisonment which may extend to seven years or
more. He submitted that such a pardon would operate not just for
offences under the Indian Penal Code but would also cover offences
under other statutes. He submitted that for an offence under Sections
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277 and 278 the sentence may extend to seven years. He submitted
that by virtue of the pardon no prosecution could have been launched
against the Appellant under these Sections.
Mr. Lahoty relied upon the case of Bipin Behari Sarkar
vs. The State of West Bengal reported in [1959 SCR 1324], wherein
it has been held as follows:
"Section 339(1) of the Code provides that "where a pardon
has been tendered under s. 337 or s. 338, and the Public
Prosecutor certifies that in his opinion any person who has
accepted such tender has, either by willfully concealing
anything essential or by giving false evidence, not
complied with the condition on which the tender was
made, such person may be tried for the offence in respect
of which the pardon was so tendered, or for any other
offence of which he appears to have been guilty in
connection with the same matter". The proviso to this
sub-section prohibits the trial of such person jointly with
any of the other accused and that such person shall be
entitled to plead at such trial that he had complied with the
condition upon which such tender was made. The
provisions of this section clearly pre-suppose that the
pardon which had been tendered to a person had been
accepted by him and that thereafter that person had
willfully concealed anything essential or had given false
evidence and therefore had not complied with the
condition on which the tender was made to him. Section
337 of the Code, under which a pardon is tendered, shows
that such tender is made on the condition that the person
to whom it is tendered makes a full and true disclosure of
the whole of the circumstances within his knowledge
relative to the offence and to every other person
concerned whether as a principal or an abettor to the
commission thereof. Sub-section (2) of this section
requires that every person who has accepted a tender shall
be examined as a witness in the court of the Magistrate
taking cognizance of the offence and in the subsequent
trial, if any. It is clear, therefore, that a mere tender of
pardon does not attract the provisions of s. 339. There
must be an acceptance of it and the person who has
accepted the pardon must be examined as a witness. It is
only thereafter that the provisions of s. 339 come into play
and the person who accepted the pardon may be tried for
the offence in respect of which the pardon was tendered, if
the Public Prosecutor certifies that in his opinion he has,
either willfully concealed anything essential or had given
false evidence and had not complied with the condition on
which the tender was made."
Relying on this case, Mr. Lahoty submitted that the High
Court was not right in stating that as yet the Appellant was an
accused. He submitted that the pardon would continue to operate
unless and until it has been revoked under Section 308 of the Criminal
Procedure Code.
Mr. Lahoty also relied upon the case of State vs. Hiralal
G. Kothari and others reported in [1960 (2) SCR 355], wherein it
has been held that the person to whom pardon is tendered is expected
to state the whole truth including details of any other subsidiary
offence which might have been committed in the course of the
commission of the offence for which pardon is tendered. It has been
held that the pardon tendered must include the subsidiary offence,
even though if the subsidiary offence alone was committed no pardon
could have been tendered for the same. He also relied upon the case
of Harumal Paramanand vs. Emperor reported in A.I.R. (1915) Sind
43, wherein it has been held that if there are more offences than one
and if anyone of them is an offence exclusively triable by the Sessions
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Court, then pardon could be granted even though the other offences
alleged or charged are not triable by the Sessions Court. He further
relies upon the case of Shiam Sunder vs. Emperor reported in AIR
1921 Allahabad 234, wherein an approver in a dacoity case also
disclosed where arms possessed by the gang were kept. After he was
released from the dacoity case he was prosecuted under the Arms Act
for possession of arms. It was held that the illegal possession of arms
and ammunition was an offence in connection with the matter of
docoity. It was held that arms were the implements of his trade and
crime and that it was impossible to separate the possession of the
arms from guilt as a dacoit. It was held that he could not make a full
and true disclosure relating to the offence of dacoity without referring
to the arms possessed by the gang. It was held that he could not be
prosecuted as the pardon covered even this act. In this case, it has
also been pointed out that if, however, he had made disclosure in
respect of some other felony which was not connected with the felony
for which he has been prosecuted, even though that would not be
covered by the pardon, the Court should recommend to the
prosecution not to proceed against him in respect of that other
offence.
Mr. Lahoty also relied upon the case of State (Govt. of
NCT of Delhi) vs. Prem Raj reported in (2003) 7 SCC 121, wherein
this Court has discussed the power of pardon and the power to
commute sentence. This authority, in our view, is of no relevance to
the question in issue.
Mr. Lahoty submitted that the pardon must necessarily
mean that no prosecution can be based in respect of the same offence.
He submitted that the offences for which the Appellant was being tried
were the same in respect of which he was now being sought to be
prosecuted under Sections 277 and 278 of the Income Tax Act. He
submitted that the High Court was thus wrong in not quashing the
prosecution.
On the other hand, Mr. Pathak, Additional Solicitor General
and Mr. B. Datta, Additional Solicitor General, submitted that the
prosecutions in respect of which pardon was granted were for
misappropriation of funds of the Animal Husbandry Department by
raising fake bills in respect of supplies never made to the Animal
Husbandry Department. They submitted that that prosecution had
nothing to do with the filing of false returns and making a false
statement in the Income Tax Returns. Reliance was placed on the
case of Jasbir Singh vs. Vipin Kumar Jaggi reported in (2001) 8
SCC 289, wherein the question was whether a person to whom
immunity has been granted under Section 64(1) of the Narcotic Drugs
and Psychotropic Substances Act, 1985 could be examined as a
witness even though he was an accused in the criminal case. The
Trial Judge held that in the absence of any pardon having been
granted under Section 307 or Section 321 of the Criminal Procedure
Code an accused could not be examined as a witness for the
prosecution. This Court held that there was no conflict between the
powers exercised under Section 307 of the Criminal Procedure Code
and by the Government under Section 64. This Court held that even if
there was a conflict, the Narcotic Drugs and Psychotropic Substances
Act, 1985 being a special and later enactment, Section 64 would
prevail. It was held that evidence could be given by the accused on
the basis of the immunity granted under Section 64.
In our view, the High Court was not correct in concluding
that until evidence has been given by the Appellant the pardon could
not operate. However, the fact remains that under Section 306
Cr.P.C. the pardon is granted in respect of the offence for which he
had been charged as an accused. Of course, a pardon need not be
only in respect of an offence under the Indian Penal Code. A person
may be charged, in respect of the same transaction or act, under the
Indian Penal Code and under some other Act, e.g. the Prevention of
Corruption Act. The pardon would operate in respects of all offences
pertaining to that transaction. However the pardon does not operate
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in respect of a transaction or act entirely unconnected with the offence
in respect of which pardon has been granted. In this case, the pardon
has been granted for the offence of misappropriation of funds. This
offence has nothing to do with filing of false returns by the Appellant.
The prosecution under Sections 277 and 278 is in respect of filing false
return and making of false declaration. The pardon which has been
granted would not cover those offences.
However, it is clear that to get benefit of the pardon the
Appellant has to make a full and frank disclosure regarding the
offences of misappropriation. If he does not make a full and complete
disclosure, the pardon may be cancelled. If he makes a full and
complete disclosure he faces the prospect of being convicted in the
prosecution under Sections 277 and 278 of the Income Tax Act.
Article 20(2) of the Constitution of India enjoins that no person can be
compelled to be a witness against himself. To continue with the
prosecution would thus amount to forcing the Appellant to give
evidence against himself or to risk pardon being cancelled as he
cannot make a full and complete disclosure for fear of being convicted
in the other case. Thus, even though the pardon may not extend to
these offences, in our view, this is a fit case where the Government
should consider not prosecuting the Appellant under these Sections.
To insist on so prosecuting may result in valuable evidence being lost
in the fodder scam cases.
We, therefore, direct that the prosecution under Sections
277 and 278 of the Income Tax Act will stand stayed till trial of the
cases in which pardon is granted is over. If the Appellant makes a full
and complete disclosure, then, in our view, the prosecution under
Sections 277 and 278 should not be allowed to proceed. We,
therefore, grant to the Appellant liberty to apply for quashing that
prosecution at that stage.
Accordingly, the Appeal is disposed off with above
directions.