Full Judgment Text
Reportable
2026 INSC 31
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
Criminal Appeal No. of 2026
(@Special Leave Petition (Crl.) No. 13057 of 2025)
The Karnataka Lokayuktha
Bagalkote District, Bagalkot
...Appellant
Versus
Chandrashekar & Anr.
...Respondents
J U D G M E N T
K. VINOD CHANDRAN, J.
Leave granted.
2. Despite this Court having consistently held that
disciplinary proceedings and criminal prosecution, even on
an identical allegation, are parallel proceedings, the
relevance of the conclusion in one is often contended to be
binding on the other. Trite is the principle that in a
disciplinary proceeding, the proof is of preponderance of
probabilities while in a criminal proceeding, it has the
higher standard of proof beyond reasonable doubt. Often it
is argued that the acquittal in the criminal proceedings
Signature Not Verified
Digitally signed by
Deepak Guglani
Date: 2026.01.06
18:07:19 IST
Reason:
should inure to the benefit of the accused/delinquent
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employee in a disciplinary proceeding too. In the present
case, we have a contrary contention of the disciplinary
proceedings having exonerated the delinquent employee,
who seeks absolution from the criminal prosecution. The
contention is that when the allegations could not be proved
in a disciplinary proceeding where the requirement is only
of preponderance of probabilities, surely it cannot be
proved beyond reasonable doubt.
3. The appellant is the Lokayukta of the State of
Karnataka, an independent body tasked also to conduct
enquiries on complaints of corruption and initiate and
continue prosecution; such powers having been statutorily
conferred under the Karnataka Lokayukta Act, 1984. On
facts, suffice it to notice that the respondent, an Executive
Engineer (Electrical) with the Works and Maintenance
Division, HESCOM, Bagalkot regulated by the Karnataka
Electricity Transmission Corporation Limited Regulations,
was alleged to have demanded a bribe from an electrical
contractor to clear five bills, at the rate of Rupees two
thousand each. The contractor complained to the Anti-
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1
Corruption Bureau who prepared a trap, with identifiable,
powdered notes kept in a packet entrusted with the
complainant, to be handed over to the Executive Engineer.
The trap was successful, and the notes were recovered from
the pocket of the Executive Engineer whose hands turned
pink on dipping in the prepared solution, which proved the
taint of corruption.
4. Disciplinary proceedings were initiated and so was
criminal prosecution launched, the former by the
department itself and the latter by the Lokayukta who is the
appellant herein. On the claim that the departmental
proceedings ended in exoneration, the delinquent
employee approached the High Court, for quashing the
criminal proceedings. The High Court by the impugned
2
judgment relied on Radheshyam Kejriwal v. State of W.B. ,
a three-Judge Bench decision to hold that if there is an
exoneration on merits where the allegation is found to be
not sustainable at all and the person held innocent, then
criminal proceedings on the same set of facts and
circumstances cannot be allowed to continue especially
1
for short, the ACB
2
(2011) 3 SCC 581
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based on the principle of higher standard of proof in
criminal cases. The learned Single Judge also refused to
follow a later judgment of this Court in State (NCT of Delhi)
3
v. Ajay Kumar Tyagi ; finding the later judgment to be per
incuriam, having been passed in ignorance of the earlier
one.
5. There can be no doubt regarding the principle that if
the later Bench holds contrary to the earlier Bench decision
of coequal strength, on the same point, the contrary dictum
expressed by the later Bench would be per incuriam as held
by a Constitution Bench in National Insurance Company
4
Limited v. Pranay Sethi . But the question arising herein is
as to whether there was a conflict with the earlier and later
judgments.
2
6. In Radheshyam Kejriwal , the raid on the premises of
the appellant therein, by the Enforcement Directorate gave
rise to proceedings under the Foreign Exchange Regulation
5
Act, 1973 . Initially, a show-cause notice was issued by the
Director of the Enforcement Directorate proposing
3
(2012) 9 SCC 685
4
(2017) 16 SCC 680
5
for short, the FERA
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adjudication proceedings under Section 51 of the FERA,
which, after explanation received was concluded with a
decision taken by the Adjudicating Officer that the
contravention of the provisions alleged cannot be sustained
since the transaction itself is not proved. The said order
became final for reason of the Enforcement Directorate
having not challenged it. Later, on the same set of facts, as
enabled under Section 56 of the FERA criminal proceedings
were initiated, which even as per the enactment could be
continued without any prejudice to any award of penalty by
the Adjudicating Officer under Section 51 of the FERA. It is
in this context that the three-Judge Bench, by a majority,
held inter alia that though the adjudication and criminal
proceedings are independent of each other, if in the former
the offender is exonerated on merits then the criminal
prosecution also comes to an inevitable end. It was also
categorically found that if the exoneration in the
adjudication proceeding is on a technical ground and not on
merits, the prosecution could continue.
2
7. In Radheshyam Kejriwal the adjudication
proceedings and the criminal proceedings were under the
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FERA, one for penalty; to recoup the economic loss caused
by the transaction contravening the provisions of the statute
and the other, prosecution; to provide penal consequences
as a deterrent measure. The subject matter of the offence
alleged in both proceedings was the contravention of the
provisions of the statute through the transaction detected.
When the adjudication proceedings found the transaction
alleged to have not taken place, then it cuts at the root of the
prosecution too. Other decisions under the FERA, where the
two proceedings of adjudication and prosecution were
found to be independent; the decision in one having no
bearing on the other, were noticed. So were the decisions
6
under the Income Tax Act, 1961 noticed, wherein, when the
penalty imposed on a presumed violation of the provisions
of the I.T. Act was set aside by the Tribunal; the last fact-
finding authority under the scheme of the I.T. Act, for that
reason alone the prosecution was found redundant and
2
quashed. Radheshyam Kejriwal culled out the principles
in the following manner:
6
For brevity ‘the I.T. Act’
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38. The ratio which can be culled out from these decisions
can broadly be stated as follows:
(i) Adjudication proceedings and criminal prosecution can
be launched simultaneously;
(ii) Decision in adjudication proceedings is not necessary
before initiating criminal prosecution;
(iii) Adjudication proceedings and criminal proceedings
are independent in nature to each other;
(iv) The finding against the person facing prosecution in
the adjudication proceedings is not binding on the
proceeding for criminal prosecution;
(v) Adjudication proceedings by the Enforcement
Directorate is not prosecution by a competent court of law
to attract the provisions of Article 20(2) of the Constitution
or Section 300 of the Code of Criminal Procedure;
(vi) The finding in the adjudication proceedings in favour
of the person facing trial for identical violation will depend
upon the nature of finding. If the exoneration in
adjudication proceedings is on technical ground and not
on merit, prosecution may continue; and
(vii) In case of exoneration, however, on merits where the
allegation is found to be not sustainable at all and the
person held innocent, criminal prosecution on the same set
of facts and circumstances cannot be allowed to continue,
the underlying principle being the higher standard of proof
in criminal cases.
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39. In our opinion, therefore, the yardstick would be to
judge as to whether the allegation in the adjudication
proceedings as well as the proceeding for prosecution is
identical and the exoneration of the person concerned in
the adjudication proceedings is on merits. In case it is
found on merit that there is no contravention of the
provisions of the Act in the adjudication proceedings, the
trial of the person concerned shall be an abuse of the
process of the court.
[ underlining by us for emphasis ]
2
8. In Radheshyam Kejriwal the very substratum of the
allegation of violation of the provisions of FERA was found to
be non-existent, an adjudication on merits that the
transaction alleged had not occurred. In the instant case the
Enquiry Report found that for reason of the Officer in charge
of the trap having not been examined, the department was
unable to establish the charge, not at all an exoneration on
merits, but more a discharge for lack of diligence. The ratio
decidendi of that case cannot be extended to every situation
where a statute provides for a civil liability and a criminal
liability, in which event Courts would be presuming what
logically follows from the finding, without any application on
the facts.
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9. In a disciplinary enquiry the employer satisfies itself
as to whether the misconduct alleged is proved and if
proved, decides on the proportionate punishment that
should be imposed; both of which are in the exclusive
domain of the employer, to be determined on the standard
of preponderance of probabilities. In a criminal prosecution
launched what assumes significance is the criminality of the
act complained of or detected which has to be proved
beyond reasonable doubt. Both are independent of each
other not only for reason of the nature of the proceedings
and the standard of proof, but also for reason of the
adjudication being carried on by two different entities,
regulated by a different set of rules and more importantly
decided on the basis of the evidence led in the independent
proceedings. If evidence is not led properly in one case, it
cannot govern the decision in the other case where
evidence is led separately and independently.
2
10. No doubt, the principles in Radheshyam Kejriwal
are applicable in a disciplinary inquiry, which was the
3
specific question considered in Ajay Kumar Tyagi ;
interestingly by the very same Hon’ble Judge who authored
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2
the majority judgment in Radheshyam Kejriwal . True, the
earlier decision was not noticed in the latter decision;
according to us with just cause since there were distinctions
on facts.
3
11. Ajay Kumar Tyagi was a case in which a successful
trap was laid and there was exoneration in the enquiry
conducted without a final order by the Disciplinary
Authority. Therein the Disciplinary Authority had not passed
an order, in deference to the pending criminal prosecution,
which action of deferment was unsuccessfully challenged in
a writ petition by the delinquent. Then a further writ petition
was filed challenging the continuance of the criminal
prosecution on the ground of exoneration in the Enquiry
Report, which stood allowed. The Disciplinary Authority
then passed an order exonerating the delinquent, subject to
a challenge to the quashing of the criminal proceedings. In
the SLP filed against the order of quashing there was a
reference to a larger Bench noting the divergence of
opinion with regard to the quashing of a prosecution based
on exoneration in a disciplinary proceeding. Even before
answering the reference the larger Bench found the
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quashing to be wrong insofar as the Disciplinary Authority
having power to differ from the findings in the report of
enquiry and the High Court, in that case having upheld the
action of the Disciplinary Authority, keeping in abeyance
the final order. We pause here to notice that herein the
Disciplinary Authority passed an order concurring with the
findings in the Enquiry Report on 08.07.2024, produced as
Annexure R-1, with a rider that the order is subject to the
proceedings in the criminal case, the consequences of
which would necessarily follow.
12.
The reference too was answered in Ajay Kumar
3
Tyagi . A two-Judge Bench decision of this Court in P.S.
7
Rajya v. State of Bihar was referred to wherein the criminal
prosecution was quashed when the departmental
7
proceedings concluded in exoneration. In P.S. Rajya , the
allegation was of possession of assets disproportionate to
the source of income. The Central Vigilance Commission
dealt with the charge and in its elaborate report concluded
that the valuation report on which CBI placed reliance is of
doubtful nature. The Court on facts found that the value
7
(1996) 9 SCC 1
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given as a base for the chargesheet was not the value given
in the reports subsequently given by the valuers. The
7
decision in P.S. Rajya relying on State of Haryana v.
8
Bhajan Lal ; the water shed decision in invocation of the
inherent powers under Section 482 of the Code of Criminal
Procedure, 1973 for quashing criminal prosecution, held
that the prosecution in that case should be quashed for more
8
than one reason as laid down in Bhajan Lal . Ajay Kumar
3
Tyagi categorically held that the quashing of criminal
7
proceedings in P.S. Rajya was not merely on account of the
exoneration in the disciplinary proceedings. Referring to a
number of decisions, it was held so in paragraphs 24 & 25
which are extracted hereunder:
“24. Therefore, in our opinion, the High Court
quashed the prosecution on total misreading of the
judgment in P.S. Rajya case (1996) 9 SCC 1. In fact,
there are precedents, to which we have referred to
above, that speak eloquently a contrary view i.e.
exoneration in departmental proceeding ipso facto
would not lead to exoneration or acquittal in a
criminal case. On principle also, this view commends
us. It is well settled that the standard of proof in a
8
1992 Supp (1) SCC 335
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department proceeding is lower than that of criminal
prosecution. It is equally well settled that the
departmental proceeding or for that matter criminal
cases have to be decided only on the basis of
evidence adduced therein. Truthfulness of the
evidence in the criminal case can be judged only
after the evidence is adduced therein and the
criminal case cannot be rejected on the basis of the
evidence in the departmental proceeding or the
report of the inquiry officer based on those evidence.
25. We are, therefore, of the opinion that the
exoneration in the departmental proceeding ipso
facto would not result in the quashing of the criminal
prosecution. We hasten to add, however, that if the
prosecution against an accused is solely based on a
finding in a proceeding and that finding is set aside
by the superior authority in the hierarchy, the very
foundation goes and the prosecution may be
quashed. But that principle will not apply in the case
of the departmental proceeding as the criminal trial
and the departmental proceeding are held by two
different entities. Further, they are not in the same
hierarchy.”
13. We are of the opinion that in the present case the
3
distinction as brought out in Ajay Kumar Tyagi squarely
applies and the ratio decidendi therein is not regulated by
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2
the ratio of the earlier judgment in Radheshyam Kejriwal .
2
In Radheshyam Kejriwal , the adjudication proceedings
and the prosecution were both by the very same entity, the
Enforcement Directorate under the FERA. In Ajay Kumar
3
Tyagi , the allegation was of a demand and acceptance of
bribe in which a trap was laid, and the prosecution was
commenced and continued by the ACB while the
departmental proceedings were by the Delhi Jal Board
under which the delinquent employee worked. Identical is
the fact in this case where the ACB laid the trap, commenced
and continued the criminal proceedings, at the behest of the
appellant, while the department carried on with the
enquiry. The findings in the enquiry report also do not
persuade us to quash the criminal proceedings as we would
presently notice.
14. At the outset, we cannot but reiterate that the enquiry
report in disciplinary proceedings is not conclusive of the
guilt or otherwise of the delinquent employee, which
finding is in the exclusive domain of the disciplinary
authority. The enquiry officer is appointed only as a
convenient measure to bring on record the allegations
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against the delinquent employee and the proof thereof and
to ensure an opportunity to the delinquent employee to
contest and defend the same by cross-examination of the
witnesses proffered by the department and even
production of further evidence, in defense. The enquiry
officer, strictly speaking, merely records the evidence and
the finding entered on the basis of the evidence led at the
enquiry does not have any bearing on the final decision of
the disciplinary authority. The disciplinary authority takes
the ultimate call as to whether to concur with the findings of
the enquiry authority or to differ therefrom. On a decision
being taken to differ from the findings in the enquiry report
as to the guilt of the delinquent employee, if it is in favour of
the delinquent employee nothing more needs to be done
since the enquiry stands closed exonerating the employee
of the charges levelled. If the decision is to concur with the
finding of guilt by the Enquiry Officer, then a show-cause is
issued with the copy of the Enquiry Report. However, while
differing from the finding of exoneration in the enquiry
report, necessarily the disciplinary authority will not only
have to issue a show-cause against the delinquent
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employee, with a copy of the Enquiry Report, but the show-
cause notice also has to specifically bring to attention of the
delinquent, the aspects on which the disciplinary authority
proposes to differ, based on the facts discovered in the
enquiry so as to afford the delinquent employee an
opportunity to proffer his defense to the same.
15. Having thus stated the law regulating the final decision
in a departmental enquiry, we cannot but notice that in the
present case, there is a final order produced as passed by
the Disciplinary Authority. The learned Counsel for the
respondent vehemently argued that a retired District Judge
was the Enquiry Officer, which according to us gives the
enquiry no higher sanctity than that would be conferred on
any enquiry report in any disciplinary proceeding carried
out by a person not trained in law. The Enquiry Officer often
is appointed as an independent person who would have no
connection with the management to ensure against any
allegation of bias. A retired judicial officer being appointed
as an enquiry officer does not confer the enquiry report any
higher value or greater sanctity than that is normally
available to such reports. We cannot but observe that in this
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case the Enquiry Officer fell into an error by requiring proof
at a higher level than that necessary under preponderance
of probabilities and so did the Disciplinary Authority, in
concurring with the same.
16. We also notice the specific findings in the enquiry
report. The exoneration was on the basis of two aspects,
one, the Inspector of the ACB who carried out the trap
having not been examined and the other, two independent
witnesses accompanying the trap team having stated that
they were standing outside the office room wherein the
handing over of the bribe took place. The first ground of the
Inspector not having been examined, according to us,
based on the preponderance of probabilities, is not
imperative, especially when the two independent witnesses
were examined. More so, insofar as the department not
being at fault since three summons were taken out and a
further request was made again for summoning the witness,
which was declined by the Enquiry Officer. We cannot but
notice that there would be no consequence in not
responding to a summons in departmental proceedings,
while a like failure in criminal proceedings would be more
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drastic. The criminal court has ample powers to ensure the
presence of a witness in a criminal proceeding, which the
Enquiry Officer does not possess. In this context, the fact
that the prosecuting agency and the one carrying on the
departmental enquiry being two entities assumes
significance. Further, here the trap was laid by the ACB, and
the prosecution was conducted at the behest of the
Lokayukta, and we cannot presume or anticipate any laxity
on the prosecuting agency of not bringing the Inspector to
the box, before the criminal court. More pertinently we
cannot, on such anticipated laxity put an end to the
prosecution.
17. We looked at the evidence laid at the enquiry, not to
regulate the order in the departmental proceedings which
is not challenged before us, but to satisfy ourselves and to
understand whether there is total exoneration on merits,
which we find to be absent. In the present case, the
witnesses proffered by the department where, (i) the
complainant; the contractor who complained of the demand
of bribe and (ii) two independent witnesses, government
officers in two different departments who accompanied the
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trap team. PW-1, the complainant categorically stated that a
bribe was demanded from him of Rupees ten thousand to
clear five bills at the rate of Rupees two thousand each. He
complained to the ACB whose Inspector marked the notes,
powdered them and put them in a packet, after noting down
the numbers to later identify them. The trap team along with
the complainant and two witnesses went to the office of the
delinquent employee. The complainant went inside the
office room wherein he handed over the packet containing
the money to the delinquent employee, who counted and
put it in his pant’s pocket, clearly spoken of by the
complainant at the enquiry. The complainant gave the signal
as agreed upon, a missed call on the mobile, when the trap
team went in, checked the pockets of the delinquent
employee, recovered the packet with the money and when
the hands of the delinquent employee were dipped in the
solution earlier prepared, the colour changed bringing
forth the taint.
18. PW-2 and PW-3 were the independent witnesses who
were standing outside the office room when the complainant
went in. They deposed that on the signal being given, the
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officers went inside the room and the witnesses followed.
They witnessed the money being taken out from the pocket
of the delinquent and the delinquent’s hands being dipped
in a solution which displayed the tainted colour. Even
without the examination of the Inspector who laid the trap
we are of the opinion that there was sufficient proof on the
standard of preponderance of probabilities to find the
delinquent guilty of the charge of demand and acceptance
of bribe. The complainant and the independent witnesses
have spoken about the incident of the successful trap laid.
19.
On the principles of law as stated hereinabove and
also on the peculiar facts coming out from the above case,
we are not convinced that this is a fit case where the criminal
proceedings can be quashed on the exoneration of the
delinquent employee in a departmental enquiry. We find
3
the decision in Ajay Kumar Tyagi to be squarely
applicable. The appeal stands allowed permitting the
continuation of criminal proceedings. We make it clear that
since the disciplinary authority has accepted the enquiry
report, there cannot be reopening of the same based on the
findings hereinabove; but a conviction in the criminal case
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would bring in consequences as mandated by rules
regulating the service, specifically reserved in the order of
the disciplinary authority, Annexure R-1.
20. The Appeal stands allowed.
21. Pending application(s), if any, shall stand disposed of.
……...…….……………………. J.
(AHSANUDDIN AMANULLAH)
……...…….……………………. J.
(K. VINOD CHANDRAN)
NEW DELHI
JANUARY 06, 2026.
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2026 INSC 31
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
Criminal Appeal No. of 2026
(@Special Leave Petition (Crl.) No. 13057 of 2025)
The Karnataka Lokayuktha
Bagalkote District, Bagalkot
...Appellant
Versus
Chandrashekar & Anr.
...Respondents
J U D G M E N T
K. VINOD CHANDRAN, J.
Leave granted.
2. Despite this Court having consistently held that
disciplinary proceedings and criminal prosecution, even on
an identical allegation, are parallel proceedings, the
relevance of the conclusion in one is often contended to be
binding on the other. Trite is the principle that in a
disciplinary proceeding, the proof is of preponderance of
probabilities while in a criminal proceeding, it has the
higher standard of proof beyond reasonable doubt. Often it
is argued that the acquittal in the criminal proceedings
Signature Not Verified
Digitally signed by
Deepak Guglani
Date: 2026.01.06
18:07:19 IST
Reason:
should inure to the benefit of the accused/delinquent
Page 1 of 21
Crl. Appeal @SLP Crl. No. 13057 of 2025
employee in a disciplinary proceeding too. In the present
case, we have a contrary contention of the disciplinary
proceedings having exonerated the delinquent employee,
who seeks absolution from the criminal prosecution. The
contention is that when the allegations could not be proved
in a disciplinary proceeding where the requirement is only
of preponderance of probabilities, surely it cannot be
proved beyond reasonable doubt.
3. The appellant is the Lokayukta of the State of
Karnataka, an independent body tasked also to conduct
enquiries on complaints of corruption and initiate and
continue prosecution; such powers having been statutorily
conferred under the Karnataka Lokayukta Act, 1984. On
facts, suffice it to notice that the respondent, an Executive
Engineer (Electrical) with the Works and Maintenance
Division, HESCOM, Bagalkot regulated by the Karnataka
Electricity Transmission Corporation Limited Regulations,
was alleged to have demanded a bribe from an electrical
contractor to clear five bills, at the rate of Rupees two
thousand each. The contractor complained to the Anti-
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1
Corruption Bureau who prepared a trap, with identifiable,
powdered notes kept in a packet entrusted with the
complainant, to be handed over to the Executive Engineer.
The trap was successful, and the notes were recovered from
the pocket of the Executive Engineer whose hands turned
pink on dipping in the prepared solution, which proved the
taint of corruption.
4. Disciplinary proceedings were initiated and so was
criminal prosecution launched, the former by the
department itself and the latter by the Lokayukta who is the
appellant herein. On the claim that the departmental
proceedings ended in exoneration, the delinquent
employee approached the High Court, for quashing the
criminal proceedings. The High Court by the impugned
2
judgment relied on Radheshyam Kejriwal v. State of W.B. ,
a three-Judge Bench decision to hold that if there is an
exoneration on merits where the allegation is found to be
not sustainable at all and the person held innocent, then
criminal proceedings on the same set of facts and
circumstances cannot be allowed to continue especially
1
for short, the ACB
2
(2011) 3 SCC 581
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based on the principle of higher standard of proof in
criminal cases. The learned Single Judge also refused to
follow a later judgment of this Court in State (NCT of Delhi)
3
v. Ajay Kumar Tyagi ; finding the later judgment to be per
incuriam, having been passed in ignorance of the earlier
one.
5. There can be no doubt regarding the principle that if
the later Bench holds contrary to the earlier Bench decision
of coequal strength, on the same point, the contrary dictum
expressed by the later Bench would be per incuriam as held
by a Constitution Bench in National Insurance Company
4
Limited v. Pranay Sethi . But the question arising herein is
as to whether there was a conflict with the earlier and later
judgments.
2
6. In Radheshyam Kejriwal , the raid on the premises of
the appellant therein, by the Enforcement Directorate gave
rise to proceedings under the Foreign Exchange Regulation
5
Act, 1973 . Initially, a show-cause notice was issued by the
Director of the Enforcement Directorate proposing
3
(2012) 9 SCC 685
4
(2017) 16 SCC 680
5
for short, the FERA
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adjudication proceedings under Section 51 of the FERA,
which, after explanation received was concluded with a
decision taken by the Adjudicating Officer that the
contravention of the provisions alleged cannot be sustained
since the transaction itself is not proved. The said order
became final for reason of the Enforcement Directorate
having not challenged it. Later, on the same set of facts, as
enabled under Section 56 of the FERA criminal proceedings
were initiated, which even as per the enactment could be
continued without any prejudice to any award of penalty by
the Adjudicating Officer under Section 51 of the FERA. It is
in this context that the three-Judge Bench, by a majority,
held inter alia that though the adjudication and criminal
proceedings are independent of each other, if in the former
the offender is exonerated on merits then the criminal
prosecution also comes to an inevitable end. It was also
categorically found that if the exoneration in the
adjudication proceeding is on a technical ground and not on
merits, the prosecution could continue.
2
7. In Radheshyam Kejriwal the adjudication
proceedings and the criminal proceedings were under the
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FERA, one for penalty; to recoup the economic loss caused
by the transaction contravening the provisions of the statute
and the other, prosecution; to provide penal consequences
as a deterrent measure. The subject matter of the offence
alleged in both proceedings was the contravention of the
provisions of the statute through the transaction detected.
When the adjudication proceedings found the transaction
alleged to have not taken place, then it cuts at the root of the
prosecution too. Other decisions under the FERA, where the
two proceedings of adjudication and prosecution were
found to be independent; the decision in one having no
bearing on the other, were noticed. So were the decisions
6
under the Income Tax Act, 1961 noticed, wherein, when the
penalty imposed on a presumed violation of the provisions
of the I.T. Act was set aside by the Tribunal; the last fact-
finding authority under the scheme of the I.T. Act, for that
reason alone the prosecution was found redundant and
2
quashed. Radheshyam Kejriwal culled out the principles
in the following manner:
6
For brevity ‘the I.T. Act’
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38. The ratio which can be culled out from these decisions
can broadly be stated as follows:
(i) Adjudication proceedings and criminal prosecution can
be launched simultaneously;
(ii) Decision in adjudication proceedings is not necessary
before initiating criminal prosecution;
(iii) Adjudication proceedings and criminal proceedings
are independent in nature to each other;
(iv) The finding against the person facing prosecution in
the adjudication proceedings is not binding on the
proceeding for criminal prosecution;
(v) Adjudication proceedings by the Enforcement
Directorate is not prosecution by a competent court of law
to attract the provisions of Article 20(2) of the Constitution
or Section 300 of the Code of Criminal Procedure;
(vi) The finding in the adjudication proceedings in favour
of the person facing trial for identical violation will depend
upon the nature of finding. If the exoneration in
adjudication proceedings is on technical ground and not
on merit, prosecution may continue; and
(vii) In case of exoneration, however, on merits where the
allegation is found to be not sustainable at all and the
person held innocent, criminal prosecution on the same set
of facts and circumstances cannot be allowed to continue,
the underlying principle being the higher standard of proof
in criminal cases.
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39. In our opinion, therefore, the yardstick would be to
judge as to whether the allegation in the adjudication
proceedings as well as the proceeding for prosecution is
identical and the exoneration of the person concerned in
the adjudication proceedings is on merits. In case it is
found on merit that there is no contravention of the
provisions of the Act in the adjudication proceedings, the
trial of the person concerned shall be an abuse of the
process of the court.
[ underlining by us for emphasis ]
2
8. In Radheshyam Kejriwal the very substratum of the
allegation of violation of the provisions of FERA was found to
be non-existent, an adjudication on merits that the
transaction alleged had not occurred. In the instant case the
Enquiry Report found that for reason of the Officer in charge
of the trap having not been examined, the department was
unable to establish the charge, not at all an exoneration on
merits, but more a discharge for lack of diligence. The ratio
decidendi of that case cannot be extended to every situation
where a statute provides for a civil liability and a criminal
liability, in which event Courts would be presuming what
logically follows from the finding, without any application on
the facts.
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9. In a disciplinary enquiry the employer satisfies itself
as to whether the misconduct alleged is proved and if
proved, decides on the proportionate punishment that
should be imposed; both of which are in the exclusive
domain of the employer, to be determined on the standard
of preponderance of probabilities. In a criminal prosecution
launched what assumes significance is the criminality of the
act complained of or detected which has to be proved
beyond reasonable doubt. Both are independent of each
other not only for reason of the nature of the proceedings
and the standard of proof, but also for reason of the
adjudication being carried on by two different entities,
regulated by a different set of rules and more importantly
decided on the basis of the evidence led in the independent
proceedings. If evidence is not led properly in one case, it
cannot govern the decision in the other case where
evidence is led separately and independently.
2
10. No doubt, the principles in Radheshyam Kejriwal
are applicable in a disciplinary inquiry, which was the
3
specific question considered in Ajay Kumar Tyagi ;
interestingly by the very same Hon’ble Judge who authored
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2
the majority judgment in Radheshyam Kejriwal . True, the
earlier decision was not noticed in the latter decision;
according to us with just cause since there were distinctions
on facts.
3
11. Ajay Kumar Tyagi was a case in which a successful
trap was laid and there was exoneration in the enquiry
conducted without a final order by the Disciplinary
Authority. Therein the Disciplinary Authority had not passed
an order, in deference to the pending criminal prosecution,
which action of deferment was unsuccessfully challenged in
a writ petition by the delinquent. Then a further writ petition
was filed challenging the continuance of the criminal
prosecution on the ground of exoneration in the Enquiry
Report, which stood allowed. The Disciplinary Authority
then passed an order exonerating the delinquent, subject to
a challenge to the quashing of the criminal proceedings. In
the SLP filed against the order of quashing there was a
reference to a larger Bench noting the divergence of
opinion with regard to the quashing of a prosecution based
on exoneration in a disciplinary proceeding. Even before
answering the reference the larger Bench found the
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quashing to be wrong insofar as the Disciplinary Authority
having power to differ from the findings in the report of
enquiry and the High Court, in that case having upheld the
action of the Disciplinary Authority, keeping in abeyance
the final order. We pause here to notice that herein the
Disciplinary Authority passed an order concurring with the
findings in the Enquiry Report on 08.07.2024, produced as
Annexure R-1, with a rider that the order is subject to the
proceedings in the criminal case, the consequences of
which would necessarily follow.
12.
The reference too was answered in Ajay Kumar
3
Tyagi . A two-Judge Bench decision of this Court in P.S.
7
Rajya v. State of Bihar was referred to wherein the criminal
prosecution was quashed when the departmental
7
proceedings concluded in exoneration. In P.S. Rajya , the
allegation was of possession of assets disproportionate to
the source of income. The Central Vigilance Commission
dealt with the charge and in its elaborate report concluded
that the valuation report on which CBI placed reliance is of
doubtful nature. The Court on facts found that the value
7
(1996) 9 SCC 1
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given as a base for the chargesheet was not the value given
in the reports subsequently given by the valuers. The
7
decision in P.S. Rajya relying on State of Haryana v.
8
Bhajan Lal ; the water shed decision in invocation of the
inherent powers under Section 482 of the Code of Criminal
Procedure, 1973 for quashing criminal prosecution, held
that the prosecution in that case should be quashed for more
8
than one reason as laid down in Bhajan Lal . Ajay Kumar
3
Tyagi categorically held that the quashing of criminal
7
proceedings in P.S. Rajya was not merely on account of the
exoneration in the disciplinary proceedings. Referring to a
number of decisions, it was held so in paragraphs 24 & 25
which are extracted hereunder:
“24. Therefore, in our opinion, the High Court
quashed the prosecution on total misreading of the
judgment in P.S. Rajya case (1996) 9 SCC 1. In fact,
there are precedents, to which we have referred to
above, that speak eloquently a contrary view i.e.
exoneration in departmental proceeding ipso facto
would not lead to exoneration or acquittal in a
criminal case. On principle also, this view commends
us. It is well settled that the standard of proof in a
8
1992 Supp (1) SCC 335
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department proceeding is lower than that of criminal
prosecution. It is equally well settled that the
departmental proceeding or for that matter criminal
cases have to be decided only on the basis of
evidence adduced therein. Truthfulness of the
evidence in the criminal case can be judged only
after the evidence is adduced therein and the
criminal case cannot be rejected on the basis of the
evidence in the departmental proceeding or the
report of the inquiry officer based on those evidence.
25. We are, therefore, of the opinion that the
exoneration in the departmental proceeding ipso
facto would not result in the quashing of the criminal
prosecution. We hasten to add, however, that if the
prosecution against an accused is solely based on a
finding in a proceeding and that finding is set aside
by the superior authority in the hierarchy, the very
foundation goes and the prosecution may be
quashed. But that principle will not apply in the case
of the departmental proceeding as the criminal trial
and the departmental proceeding are held by two
different entities. Further, they are not in the same
hierarchy.”
13. We are of the opinion that in the present case the
3
distinction as brought out in Ajay Kumar Tyagi squarely
applies and the ratio decidendi therein is not regulated by
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2
the ratio of the earlier judgment in Radheshyam Kejriwal .
2
In Radheshyam Kejriwal , the adjudication proceedings
and the prosecution were both by the very same entity, the
Enforcement Directorate under the FERA. In Ajay Kumar
3
Tyagi , the allegation was of a demand and acceptance of
bribe in which a trap was laid, and the prosecution was
commenced and continued by the ACB while the
departmental proceedings were by the Delhi Jal Board
under which the delinquent employee worked. Identical is
the fact in this case where the ACB laid the trap, commenced
and continued the criminal proceedings, at the behest of the
appellant, while the department carried on with the
enquiry. The findings in the enquiry report also do not
persuade us to quash the criminal proceedings as we would
presently notice.
14. At the outset, we cannot but reiterate that the enquiry
report in disciplinary proceedings is not conclusive of the
guilt or otherwise of the delinquent employee, which
finding is in the exclusive domain of the disciplinary
authority. The enquiry officer is appointed only as a
convenient measure to bring on record the allegations
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against the delinquent employee and the proof thereof and
to ensure an opportunity to the delinquent employee to
contest and defend the same by cross-examination of the
witnesses proffered by the department and even
production of further evidence, in defense. The enquiry
officer, strictly speaking, merely records the evidence and
the finding entered on the basis of the evidence led at the
enquiry does not have any bearing on the final decision of
the disciplinary authority. The disciplinary authority takes
the ultimate call as to whether to concur with the findings of
the enquiry authority or to differ therefrom. On a decision
being taken to differ from the findings in the enquiry report
as to the guilt of the delinquent employee, if it is in favour of
the delinquent employee nothing more needs to be done
since the enquiry stands closed exonerating the employee
of the charges levelled. If the decision is to concur with the
finding of guilt by the Enquiry Officer, then a show-cause is
issued with the copy of the Enquiry Report. However, while
differing from the finding of exoneration in the enquiry
report, necessarily the disciplinary authority will not only
have to issue a show-cause against the delinquent
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employee, with a copy of the Enquiry Report, but the show-
cause notice also has to specifically bring to attention of the
delinquent, the aspects on which the disciplinary authority
proposes to differ, based on the facts discovered in the
enquiry so as to afford the delinquent employee an
opportunity to proffer his defense to the same.
15. Having thus stated the law regulating the final decision
in a departmental enquiry, we cannot but notice that in the
present case, there is a final order produced as passed by
the Disciplinary Authority. The learned Counsel for the
respondent vehemently argued that a retired District Judge
was the Enquiry Officer, which according to us gives the
enquiry no higher sanctity than that would be conferred on
any enquiry report in any disciplinary proceeding carried
out by a person not trained in law. The Enquiry Officer often
is appointed as an independent person who would have no
connection with the management to ensure against any
allegation of bias. A retired judicial officer being appointed
as an enquiry officer does not confer the enquiry report any
higher value or greater sanctity than that is normally
available to such reports. We cannot but observe that in this
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case the Enquiry Officer fell into an error by requiring proof
at a higher level than that necessary under preponderance
of probabilities and so did the Disciplinary Authority, in
concurring with the same.
16. We also notice the specific findings in the enquiry
report. The exoneration was on the basis of two aspects,
one, the Inspector of the ACB who carried out the trap
having not been examined and the other, two independent
witnesses accompanying the trap team having stated that
they were standing outside the office room wherein the
handing over of the bribe took place. The first ground of the
Inspector not having been examined, according to us,
based on the preponderance of probabilities, is not
imperative, especially when the two independent witnesses
were examined. More so, insofar as the department not
being at fault since three summons were taken out and a
further request was made again for summoning the witness,
which was declined by the Enquiry Officer. We cannot but
notice that there would be no consequence in not
responding to a summons in departmental proceedings,
while a like failure in criminal proceedings would be more
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drastic. The criminal court has ample powers to ensure the
presence of a witness in a criminal proceeding, which the
Enquiry Officer does not possess. In this context, the fact
that the prosecuting agency and the one carrying on the
departmental enquiry being two entities assumes
significance. Further, here the trap was laid by the ACB, and
the prosecution was conducted at the behest of the
Lokayukta, and we cannot presume or anticipate any laxity
on the prosecuting agency of not bringing the Inspector to
the box, before the criminal court. More pertinently we
cannot, on such anticipated laxity put an end to the
prosecution.
17. We looked at the evidence laid at the enquiry, not to
regulate the order in the departmental proceedings which
is not challenged before us, but to satisfy ourselves and to
understand whether there is total exoneration on merits,
which we find to be absent. In the present case, the
witnesses proffered by the department where, (i) the
complainant; the contractor who complained of the demand
of bribe and (ii) two independent witnesses, government
officers in two different departments who accompanied the
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trap team. PW-1, the complainant categorically stated that a
bribe was demanded from him of Rupees ten thousand to
clear five bills at the rate of Rupees two thousand each. He
complained to the ACB whose Inspector marked the notes,
powdered them and put them in a packet, after noting down
the numbers to later identify them. The trap team along with
the complainant and two witnesses went to the office of the
delinquent employee. The complainant went inside the
office room wherein he handed over the packet containing
the money to the delinquent employee, who counted and
put it in his pant’s pocket, clearly spoken of by the
complainant at the enquiry. The complainant gave the signal
as agreed upon, a missed call on the mobile, when the trap
team went in, checked the pockets of the delinquent
employee, recovered the packet with the money and when
the hands of the delinquent employee were dipped in the
solution earlier prepared, the colour changed bringing
forth the taint.
18. PW-2 and PW-3 were the independent witnesses who
were standing outside the office room when the complainant
went in. They deposed that on the signal being given, the
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officers went inside the room and the witnesses followed.
They witnessed the money being taken out from the pocket
of the delinquent and the delinquent’s hands being dipped
in a solution which displayed the tainted colour. Even
without the examination of the Inspector who laid the trap
we are of the opinion that there was sufficient proof on the
standard of preponderance of probabilities to find the
delinquent guilty of the charge of demand and acceptance
of bribe. The complainant and the independent witnesses
have spoken about the incident of the successful trap laid.
19.
On the principles of law as stated hereinabove and
also on the peculiar facts coming out from the above case,
we are not convinced that this is a fit case where the criminal
proceedings can be quashed on the exoneration of the
delinquent employee in a departmental enquiry. We find
3
the decision in Ajay Kumar Tyagi to be squarely
applicable. The appeal stands allowed permitting the
continuation of criminal proceedings. We make it clear that
since the disciplinary authority has accepted the enquiry
report, there cannot be reopening of the same based on the
findings hereinabove; but a conviction in the criminal case
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would bring in consequences as mandated by rules
regulating the service, specifically reserved in the order of
the disciplinary authority, Annexure R-1.
20. The Appeal stands allowed.
21. Pending application(s), if any, shall stand disposed of.
……...…….……………………. J.
(AHSANUDDIN AMANULLAH)
……...…….……………………. J.
(K. VINOD CHANDRAN)
NEW DELHI
JANUARY 06, 2026.
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