IN THE HIGH COURT OF KERALA AT ERNAKULAM

PRESENT

THE HONOURABLE MR. JUSTICE R. NARAYANA PISHARADI

THURSDAY, THE 7TH DAY OF OCTOBER 2021 / 15TH ASWINA, 1943

CRL.MC NO. 2861 OF 2020

ARISING OUT OF FIR VC 2/2017/PTA OF VACB PATHANAMTHITTA

PETITIONER:

ASOKA KUMAR S.,AGED 39 YEARSS/O.SIVADHASAN PILLAI, NELLIPARAMBIL VEEDU, KALLELIBHAGOM, KARUNGAPPALLY, KOLLAM-690519BY ADVS.KALEESWARAM RAJSRI.VARUN C.VIJAYKUM.A.ARUNAKUM.THULASI K. RAJSMT.MAITREYI SACHIDANANDA HEGDE

RESPONDENTS:

1 STATE OF KERALAREPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM-682031

2 VIGILANCE AND ANTI -CORRUPTION BUREAUREPRESENTED BY ITS DIRECTOR, PMG, OPPOSITE VIKASBHAVAN BUS DEPOT, THIRUVANANTHAPURAM, KERALA-695033

3 SMT.SEEMA SATHYANESANAGED 45 YEARSW/O.SATHYANESAN, KOLATHARA HOUSE, VAZAPALLY WEST.P.O, CHANGANASSERY, KOTTAYAM.686103

SMT S L SYLAJA-PP

THIS CRIMINAL MISC. CASE HAVING COME UP FOR ADMISSION

ON 28.09.2021, THE COURT ON 07.10.2021 PASSED THE

FOLLOWING:

Crl.M.C.No.2861/20202

R.NARAYANA PISHARADI, J**********************

Crl.M.C.No.2861 of 2020-------------------------------------

Dated this the 7th day of October, 2021-------------------------------------------

O R D E R

The petitioner is an Excise Inspector. He is the first accused

in the case registered by the Vigilance and Anti-Corruption

Bureau (VACB), Pathanamthitta as V.C.No.02/2017/PTA under

Sections 7 and 13(1)(d) read with 13(2) of the Prevention of

Corruption Act, 1988 (for short 'the Act'). The second and the

third accused in the case are Preventive Officers of the Excise

Department.

2. On 20.04.2016, the accused, while working in the

Excise Enforcement and Anti-Narcotic Special Cell,

Pathanamthitta had allegedly seized 27 cans, each containing 33

litres of spirit, unauthorisedly kept in the rented house in which

the third respondent was residing. A case was registered in that

Crl.M.C.No.2861/20203

matter as O.R No.40/2016.

3. On 21.04.2016, the third respondent was produced

before the Judicial First Class Magistrate, Thiruvalla, in the case

registered against her. The third respondent then made

Annexure-I written complaint before the learned Magistrate.

4. The crux of the allegations in Annexure-I complaint made

by the third respondent before the learned Magistrate was that,

the accused, who were Excise Officers, obtained Rs.4,62,000/-

from her on the promise that they would exclude her from the

Abkari case and that they produced only Rs.2,25,000/- in the

Magistrate's Court.

5. Learned Magistrate forwarded Annexure-I complaint to

the Enquiry Commissioner and Special Judge,

Thiruvananthapuram. The learned Special Judge directed the

VACB to conduct a preliminary enquiry in the matter.

6. The Dy.S.P VACB, Pathanamthitta conducted a

preliminary enquiry into the allegations in Annexure-I complaint

and filed a report before the Special Court that no criminal action

Crl.M.C.No.2861/20204

was required to be taken against the accused persons.

7. The Special Court did not accept the findings in the

preliminary enquiry report. The Special Court directed the VACB

to conduct a further enquiry. After conducting further

verification, the Dy.S.P, VACB, Southern Circle,

Thiruvananthapuram filed a report that there was no acceptable

evidence to find that the accused had obtained Rs.4,62,000/-

from the third respondent.

8. The third respondent filed objection to the verification

report filed by the VACB. She filed additional documents in the

Special Court to prove the source of Rs.4,62,000/- allegedly

given by her to the accused.

9. As per Annexure-II order dated 30.10.2017, the

Special Court directed the VACB to register a case against the

accused and to conduct investigation.

10. Pursuant to the direction made by the Special Court in

Annexure-II order, the VACB registered Annexure-III FIR against

the petitioner and the two other Excise Officers.

Crl.M.C.No.2861/20205

11. After conducting investigation, the Dy.S.P, VACB filed

Annexure-V final report in the Special Court stating “Further

Action Dropped”.

12. The Special Court did not accept Annexure-V final

report. As per Annexure-VII order dated 22.05.2020, the Special

Court directed the investigating officer to conduct further

investigation in the case. The relevant portion of Annexure-VII

order reads as follows:

“17. Therefore, the final report filed by the

investigating officer to treat the case as “further

action dropped” is not accepted. The

investigating officer is directed to obtain

necessary approval/sanction as required under

the provisions of the Prevention of Corruption

Act, 1988 and to conduct a meaningful and

effective investigation as indicated above and

shall file report.”

13. This application is filed by the first accused under

Section 482 of the Code of Criminal Procedure, 1973 (for short

'the Code') for setting aside Annexure-VII order and to accept

Annexure-V final report.

Crl.M.C.No.2861/20206

14. The investigating officer has filed a statement before

this Court. It is mentioned in this statement that the point which

has been ordered to be investigated further by the Special Court

has already been investigated by the VACB.

15. Inspite of service of notice on the third respondent,

there was no representation for her at the time of hearing this

case. Heard the learned counsel for the petitioner and the

learned Public Prosecutor.

16. Learned counsel for the petitioner contended that the

matters which have been ordered to be further investigated by

the Special Court are matters which have already been

thoroughly investigated by the VACB and there is no scope for

conducting any further investigation on those aspects. Learned

counsel further contended that, when the investigating officer

has based his opinion on the materials collected during the

investigation and when such opinion depicts a reasonable view of

the matter, the Special Court would not be justified in issuing a

direction to conduct further investigation.

Crl.M.C.No.2861/20207

17. The allegations in Annexure-I complaint made by the

third respondent before the learned Magistrate are as follows:

When spirit was seized from the rented house in which she was

residing, the three Excise Officers (A1 to A3), who had come to

her house for detecting the case, obtained Rs.4,62,000/- from

her, on the promise that she would not be made an accused in

the case. She had raised Rs.3,62,000/- from Muthoot Finance

and Rs.1,00,000/- from Kavadaparambil Finance by pledging

(gold ornaments?) and she had receipt with her to prove the

same. It was this amount which she gave the accused and only

Rs.2,25,000/- was produced before the court.

18. One cannot ignore the fact that the complaint against

the Excise Officers was made by the third respondent at the first

and the earliest opportunity, that is, when she was produced

before the learned Magistrate. But, the question looms large why

the Excise Officers shall produce Rs.2,25,000/- in the

Magistrate's Court as money seized from the house of the third

respondent, if it was part of the money obtained by them as

Crl.M.C.No.2861/20208

bribe from the third respondent.

19. Annexure-V final report shows that the investigating

officer had produced before the Special Court 36 documents

which had been seized or collected and verified by him during the

investigation.

20. What courses are left open to a Magistrate in a situation

where the investigating agency submits final report (refer report

or closure report) stating that no case is made out against the

accused on account of lack of evidence or for any other reason?

21. In such a situation, the Magistrate may adopt any of the

following courses: (1) If he agrees with the final report, he may

accept it and close the proceedings (2) He may find, on a

consideration of the final report, that the opinion formed by the

investigating officer is not based on a full and complete

investigation. Then, he has ample jurisdiction under Section

156(3) of the Code to direct a further investigation. (3) If the

Magistrate forms the opinion that, the facts set out in the final

report, constitute an offence, he may take cognizance of the

Crl.M.C.No.2861/20209

offence under Section 190(1)(b) of the Code, notwithstanding the

contrary opinion of the investigating officer (See Abhinandan

Jha v. Dinesh Mishra : AIR 1968 SC 117).

22. In addition to the above courses, if it it is a case in

which a private complaint within the meaning of Section 190(1)

(a) of the Code was referred to the police under Section 156(3)

of the Code and if the investigating officer has filed a refer

report, the Magistrate could also fall back upon the private

complaint which was initially lodged. The Magistrate may take

cognizance of the offence under Section 190(1)(a) of the Code

on the basis of the original complaint and proceed to examine

upon oath the complainant and his witnesses under Section 200.

If he adopts this course, he may hold or direct an inquiry under

Section 202 of the Code if he thinks fit. Thereafter, he may

dismiss the complaint or issue process, as the case may be (See

H.S.Bains v. State : AIR 1980 SC 1883).

23. Therefore, inspite of the opinion of the investigating

officer that there is no sufficient evidence to send the accused for

Crl.M.C.No.2861/202010

trial, the Special Court may decline to accept the police report.

The Special Court may find that the opinion formed by the police

is not based on a full and complete investigation and that there is

scope for conducting further investigation. Then, the Court has

ample power to direct further investigation under Section 156(3)

of the Code.

24. However, the Court has to scrupulously scrutinize the

final report and the accompaniments by applying its judicial mind

before it takes a decision to disagree with the opinion of the

investigating officer (See Sampat Singh v. State of Haryana :

(1993) 1 SCC 561).

25. The Court has to independently apply its mind to the

facts emerging from the investigation. Once the conscience of the

court is satisfied, from the materials on record, that the police

has not conducted proper investigation, it is the duty of the Court

to ensure that the investigation is conducted in accordance with

law. If deficiency in investigation is visible or can be perceived by

lifting the veil hiding the realities, the Court shall order further

Crl.M.C.No.2861/202011

investigation but it shall then point out what is the deficiency in

the investigation already conducted. When the Court disagrees

with the closure report and orders further investigation, the Court

shall specifically point out the matters left out and not

investigated. The Court shall pinpoint what all matters were not

investigated by the police and what aspects require further

investigation. It is not enough to make a general observation that

the investigation conducted was incomplete or defective. If in the

opinion of the Court the investigation conducted was not fair, the

Court shall state the reasons for coming to such conclusion.

26. In Nupur Talwar v. C.B.I : AIR 2012 SC 1921, the

Supreme Court had occasion to observe as follows:

“Since the CBI wanted the matter to be closed, it

was appropriate though not imperative for the

Magistrate to record reasons, for differing with the

prayer made in the closure report. After all, the CBI

would have surely wished to know, how it went

wrong”.

27. In the instant case, the investigating officer had formed

opinion that the complaint made against the accused by the

Crl.M.C.No.2861/202012

third respondent cannot be true because the materials collected

during the investigation showed that her version that she raised

the amount by pledging gold ornaments in two finance

companies was not true. The version of the third respondent was

that she obtained Rs.3,62,000/- from Muthoot Finance,

Chengannoor and Rs.1,00,000/- from Kavadaparambil Finance,

Eramallikkara by pledging gold ornaments on 20.04.2016. It was

found out during the investigation that the third respondent had

pledged gold ornaments in Kavadaparambil Finance on

14.03.2016 and obtained Rs.3,40,000/- from there. It was found

out from records that, the third respondent obtained an advance

amount of Rs.3,50,000/- from Muthoot Finance on 20.04.2016

and by using that amount, she closed the gold loan in

Kavadaparambil Finance. She pledged the gold ornaments on the

same day in Muthoot Finance for Rs.3,62,000/- and obtained

Rs.12,000/- in cash after deducting the amount of Rs.3,50,000/-

which she had received as advance. The investigating officer also

found out from records that, on 20.04.2016, the third respondent

Crl.M.C.No.2861/202013

had obtained Rs.1,00,000/- from Kavadaparambil Finance by

pledging other gold ornaments. The statements of witnesses also

revealed the above transactions.

28. There is no doubt that the learned Special Judge was

not bound by the above opinion of the investigating officer. The

learned Special Judge is competent to disagree with the final

report and direct further investigation. However, existence of

valid and good reasons is a prerequisite for issuing such a

direction. In the instant case, the learned Special Judge has

passed an order in detail, stating the reasons for directing further

investigation. But, the question is, whether the reasons stated

are valid or not.

29. With regard to the investigation conducted, as to the

source of the amount given as bribe, the Special Court has stated

in the impugned order as follows:

“In the above circumstances, the Investigating

officer was duty bound to probe the said matter

thoroughly with reference to all the records

maintained at 'Muthoot Finance, Chenganoor'

viz., the Trial Balance, account books and the

Crl.M.C.No.2861/202014

account books and records of 'Kavadaparambil

Finance.' It is to be noted that the investigating

officer had not done any effective investigation

regarding the said aspect with the object of

finding truth rather he simply arrived at a

conclusion that the accused have seized only an

amount of Rs.2,25,000/- from the house of the

complainant.”

30. The Special Court has further observed as follows:

“ Upon going through the entire materials

produced before the court, this court finds that

the investigation done by the Investigating officer

is incomplete. The veracity of the version

regarding takeover of gold loan of complainant

from 'Kavadaparambil Finance' by 'Muthoot

Finance' is to be probed thoroughly to bring out

the truth regarding the allegations of demand

and acceptance of bribe leveled against the

accused by the complainant. A meaningful and

purposeful investigation has to be conducted as

to the time at which the accused Excise officials

reached at the house of the complainant on

20.04.2016 as well as about the alleged demand

and acceptance of Rs.4,62,000/- from the

complainant.”

Crl.M.C.No.2861/202015

31. Learned Special Judge has directed further investigation

mainly on two aspects. (1) The veracity of the version of “take

over transaction” of gold loan (2) The time at which the Excise

Officers reached the house of the third respondent.

32. Regarding the “take over transaction” of gold loan by

the Muthoot Finance from Kavadaparambil Finance, the final

report reveals that the investigating officer had seized or

collected and verified the relevant registers and records in the

above two finance companies. The details of the gold loan

transactions made by the third respondent in the two finance

companies are explained in the final report. The relevant

registers and records were also produced in the Special Court

alongwith the final report. In such circumstances, the learned

Special Judge was not justified in directing to conduct further

investigation with reference to such records kept in the two

finance companies.

33. Learned Special Judge has disagreed with the opinion of

the investigating officer with regard to the “take over transaction”

Crl.M.C.No.2861/202016

of gold loan for the reason that there were material omissions in

the statements made by some witnesses during the preliminary

enquiry conducted in this case and also during the departmental

enquiry conducted by the Excise Department.

34. The statements given by the witnesses in the

departmental enquiry conducted by the Excise Department

should not have been considered by the Special Court in forming

an opinion on the final report filed by the investigating officer.

The statements, if any, given by such witnesses to the

investigating officer could only have been considered by the

Special Court in this regard.

35. Learned Special Judge has also highlighted the

omissions in the statements given by the witnesses during the

preliminary enquiry conducted by the VACB with reference to the

statements given by them during the investigation of the case

and found that the witnesses have, during the investigation,

come up with a new story regarding the gold loan availed of by

the third respondent.

Crl.M.C.No.2861/202017

36. In Gian Prakash Sharma v. Central Bureau of

Investigation :2004 Cri.L.J 3817, in a corruption case, the

Punjab and Haryana High Court had occasion to observe as

follows:

“Similarly, the learned Special Judge has also

placed reliance on the pre-investigation statements

allegedly made by the shadow witness, Sukhwant

Singh and another alleged independent witness,

namely, Surjeet Singh. In my view, their alleged

statements recorded prior to the initiation of

investigation of this case by the C.B.I. are of no

legal consequence”.

(emphasis supplied)

37. The purpose of the preliminary enquiry is only to find

out whether the information received discloses any cognizable or

not. The statement given by a witness or an accused during such

enquiry cannot be said to be a statement under Section 160 of

the Code and/or a statement recorded during the course of

investigation (See Charansingh v. State of Maharashtra : AIR

2021 SC 1620).

Crl.M.C.No.2861/202018

38. Since the purpose of the preliminary enquiry is only to

ascertain whether the information received discloses any

cognizable offence or not, the statements of witnesses recorded

during the preliminary enquiry may not be exhaustive and such

statements may not contain all details. Therefore, omissions in

such statements, cannot be a reason to find that the witnesses

have created a new story at the time of investigation of the case.

Further investigation cannot be ordered merely for the reason

that there are contradictions in the statements made by the

witnesses with reference to the statement given by them during

the preliminary enquiry.

39. Of course, the time at which the Excise Officers reached

the house of the third respondent on 20.04.2016 has got

significance. It is relevant here to note that, as per the statement

given by the third respondent during the investigation, the

second and the third accused were the persons who demanded

bribe from her and it was the second accused with whom she

entrusted the amount. There is allegation that the second and

Crl.M.C.No.2861/202019

the third accused had reached the house of the third respondent

much before the time mentioned in the records relating to the

case registered against her and that they demanded bribe from

her. The investigating officer has verified the call data records of

the mobile phones of the second and the third accused. However,

it is not proper to mention anything here in that regard because

they are not parties to the present case before this Court.

40. In the above circumstances, the reasons stated by the

learned Special Judge for directing further investigation, at least

as against the petitioner, cannot be found to be valid. Even

when there is suspicion against a person, during the

investigation, if sufficient evidence cannot be collected against

him to send him for trial, it would be a futile exercise to conduct

further investigation into the same aspects. As noticed earlier,

there is no specific allegation against the petitioner that he had

demanded bribe from the third respondent or her husband.

41. The discussion above leads to the conclusion that there

is no scope for conducting any further investigation in the matter

Crl.M.C.No.2861/202020

as against the petitioner.

42. Consequently, the petition is allowed as follows:

Annexure-VII order is set aside and Annexure-V final report

(closure report) is ordered to be accepted, only as far as they

pertain to the petitioner.

All pending interlocutory applications are closed.

R.NARAYANA PISHARADI, JUDGE

lsn/jsr

Crl.M.C.No.2861/202021

APPENDIX OF CRL.MC 2861/2020

PETITIONER'S ANNEXURES

ANNEXURE I TRUE COPY OF THE COMPLAINT DATED21.4.2016 FILED BY SMT.SEEMA SATHYANESANBEFORE THE HON'BLE JUDICIAL FIRST CLASSMAGISTRATE COURT

ANNEXURE II TRUE COPY OF THE ORDER DATED 30.10.2017IN CRL.M.P.NO.878/2016

ANNEXURE III TRUE COPY OF THE FIRST INFORMATIONREPORT

ANNEXURE IV TRUE COPY OF THE ORDER DATED 06.12.2017IN CRL.M.C NO.8026/2017

ANNEXURE V TRUECOPY OF THE FINAL REPORTANNEXURE VI TRUE COPY OF THE ORDER DATED 19.03.2020

IN CRL.M.C NO.8893/2019ANNEXURE VII TRUE COPY OF THE ORDER DATED 22.05.2020

IN VC.2/2017/PTA PASSED BY THE COURT OFENQUIRY COMMISSIONER AND SPECIAL JUDGE,THIRUVANANTHAPURAM.

ANNEXURE VIII TRUE RELEVANT PAGES OF THE ENQUIRYREPORT DATED 30.07.2016, VIGILANCEOFFICER(EXCISE)

ANNEXURE IX TRUE COPY OF THE REPORT ISSUED OTSRI.VIJAYADAS G TOGETHER WITH COVERINGLETTER DATED 09.10.2017 UNDER THE RIGHTTO INFORMATION ACT

ANNEXURE X TRUE COPY OF THE GO(RT)NO.546/2019/TAXES DATED 02.08.2019

RESPONDENTS' EXHIBITS: NIL

TRUE COPY

PS TO JUDGE