Full Judgment Text
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PETITIONER:
STATE OF BIHAR & ANR.
Vs.
RESPONDENT:
RANCHI ZILA SAMTA PARTY & ANR,
DATE OF JUDGMENT: 19/03/1996
BENCH:
RAMASWAMY, K.
BENCH:
RAMASWAMY, K.
BHARUCHA S.P. (J)
PARIPOORNAN, K.S.(J)
CITATION:
1996 AIR 1515 1996 SCC (3) 682
JT 1996 (3) 751 1996 SCALE (3)236
ACT:
HEADNOTE:
JUDGMENT:
AND
CIVIL APPEAL NO.5177-82 OF 1996
[Arising out-SLP [C] 5841-44 and 5845-46 of 1996]
O R D E R
Leave granted.
Heard learned counsel on both sides.
These appeals by special leave arise from the Judgment
dated March 11, 1996 of the Division Bench of the Patna High
Court in CWJC No.459 of 1996 and batch. It is not necessary
to narrate all the facts stated in the impugned judgment of
the High Court. Suffice it to state that a large-scale
defalcation of public funds, fraudulent transactions and
falsification of accounts, to the tune of around Rs. 500
crores, came to light in the Animal Husbandry Department of
the State of Bihar. This had taken place during the years
1977-78 to 1995-96. A similar situation prevailed in the
Education, Cooperation and Fisheries Departments. It is
agreed by all the counsel that an in-depth investigation is
required to be made. The only controversy between counsel on
either side is whether the High Court, in exercise of its
power under Article 226, could take the investigation away
from the State police and entrust lt to the Central Bureau
of Investigation [CBI].
Shri F.S. Nariman, learned senior counsel appearing for
the State, contended that, by reason of Entry 80 of List I
of the Seventh Schedule to the Constitution and Section 6 of
the Delhi Special Police Act, 1946 [Act 26 of 1946], without
the consent of the appropriate State Government no
investigating agency other than the State police could
investigate an offence committed in the State. The High
Court, while exercising power under Article 22, should have
kept in mind this limitation. The limitation did not apply
to this Court exercising power under Article 142 of the
Constitution to do complete justice. The High Court
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therefore, was not correct in law in directing the CBI to
investigate the allegations of defalcation of public funds,
large-scale misappropriation, fabrication and destruction of
the record etc. Shri P P. Rao, learned senior counsel,
contended that the State Government had not delayed in
instituting the investigation. As soon as the matter was
brought to the knowledge of the Chief Minister, he took
prompt action, suspended the erring officers and constituted
an Enquiry to submit periodical reports. The state, Mr. Rao
submitted, would not attempt to shield any corrupt officer
from being prosecuted or proceeded with departmentally. The
prompt action taken established the sincerity of the State
Government to see that proper investigation was carried out.
There was no allegation against the State police. The High
Court could have preserved control and supervised the
investigation by the State police. Instead, it divested the
State police of its statutory power and entrusted the case
to the CBI, which upset the distribution of powers under the
Constitution. Shri Soli J. Sorabjee, learned senior counsel,
supporting all the contention, submitted that the power was
traceable to Entry 39 of the Government of India Act, 1935.
the State police could not be divested of the power. The
investigation by the Central agency could not have been
ordered by the High Court without the consent of the State
Government.
On the other hand, Shri Shanti Bhushan, learned senior
counsel leading for the respondents, contended that the
power of the High Court was unlimited There were self-
imposed limitations on the exercise or that power. in view
of the enormity fraudulent transactions that had taken
placed within the administration of the State, they needed
to be investigated and the erring officers brought to book
by an independent agency. The people’s confidence would be
best assured if the investigation was conducted by an
independent agency.There was no reason for the CBI to either
falsely implicate any innocent person or shield any real
culprit. Therefore, in a democratic set up when a cloud was
cast on the administration it would be appropriate for an
independent agency to conduct the investigation. The High
Court, therefore, in exercise of its discretionary power
under Article 226 had rightly directed the CBI to
investigate these fraudulent transactions involving more
than Rs.500 crores - an estimate given by the State itself.
Shri Arun jaitley, learned senior counsel, criticized the
inaction on the part of the State police in investigation
and laying charge-sheets against erring officers on the
basis of the evidence on record despite the Income-tax
Department’s information in this behalf through the State’s
vigilance Commission. Shri Rajeev Dhavan learned senior
counsel, supported the judgment on the argument of public
confidence and Shri O.P. Sharma learned senior counsel,
echoed it.
In view of the contentions, the question that arises
for consideration is whether this Court would be justified
in interfering with the order passed by the High Court. The
parameters of the power of the High Court under Article 226
of the Constitution to direct an investigation by the CBI,
though without the consent of the concerned State, is the
subject matter of a reference pending consideration of a
Constitution Bench of five Judges of this Court. [This is in
w.p.Nos.531-36 of 1985 by order dated March 10, 1989.]
Therefore, the frontiers of the power of the High Court
under Article 226 to give directions to the CBI to
investigate into offences without the State’s consent, are
already before this Court and shall be gone into. All
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arguments addressed by learned counsel on either side would
be considered and dealt with by the Constitution Bench.
The only question then is whether this is a fit case
for our interference under Article 136 of the Constitution?
The exercise of the power under Article 226 of the
Constitution in a public interest litigation was not to
give any advantage to a political party or group of people,
as apprehended by counsel for the appellants. It was also
not to cast a slur on the State police. It was done to
investigate corruption in public administration, misconduct
by the bureaucracy, fabrication of official records, and
misappropriation of public funds by an independent agency
that would command public confidence. We are, therefore, of
the opinion that the direction given by the High Court
appears to be just and proper and calls for no real
interference.
The question then is whether the direction given by the
High Court needs any modification. It is pointed out by Shri
Nariman that the State police have already instituted 40
First Information Reports against different persons,
arrested 44 offenders and attached the properties of 239
perhaps. There is no gainsaying that all persons involved in
these offences need tc be identified. Not only all the
aforementioned persons but also all other persons involved
need to be dealt with according to law. This modification
shall be made.
We are also of the opinion that, to alleviate the
apprehensions of the State about the control of the
investigation by the CBI, it should be under the overall
control and supervision of the Chief Justice of the Patna
High Court. The CBI officers entrusted with the
investigation shall, apart from the concerned criminal
court, inform the Chief Justice of the Patna High Court from
time to time of the progress made in the investigation and
may, if they need any directions in the matter of
conductions the investigation, obtain them from him. The
learned Chief Justice may either post the matter for
directions before a Bench presided over by him or constitute
any other appropriate Bench. After the investigation is over
and reports are finalized, as indicated by the Division
Bench of the High Court in the impugned judgment,
expeditious follow-up action shall be taken. The High Court
and the State Government shall co-operate in assigning
adequate number of special Judges to deal with the cases
expeditiously so that no evidence may be lost.
The order of the Division Bench of the high Court in
paragraph 54, to the effect that investigation by the State
police in cases already instituted shall remain suspended,
is modified. The entire investigation now stands entrusted
to the CBI as aforesaid. The CBI is directed to take over
the investigation already made by the State police,
inclusive Of the FIRs, arrests and attachments
aforementioned, and deal appropriately therewith.
The appeals are disposed of accordingly. No costs.