Proper sanction and application of mind were essential; prosecution failed and merits findings were expunged.

Proper sanction was required before the prosecution could proceed, and the sanctioning authority was expected to consider all relevant materials, including statements recorded by the Investigating Officer. Consideration of only a vigilance report was insufficient to show application of mind, so the prosecution was not maintainable for want of valid sanction. Once that defect was found, the courts below ought not to have examined the merits of the prosecution case, and their findings on merits were expunged. It was left open to the State to proceed afresh after obtaining the necessary sanction.

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Issues: Whether the prosecution was maintainable in the absence of proper sanction and whether findings on merits recorded by the courts below could stand after the finding of want of sanction.

Analysis: The sanctioning authority had not been shown to have before it all relevant materials, including the statements recorded by the Investigating Officer, and consideration of only a vigilance report was insufficient to demonstrate proper application of mind to the materials on record. Once the proceedings were found to be without proper sanction, there was no occasion for the courts below to enter into the merits of the prosecution case. The findings on merits were therefore not to be acted upon and were directed to stand expunged.

Conclusion: The prosecution was held to be not maintainable for want of proper sanction, and the findings on merits were expunged. It was left open to the State to proceed afresh after obtaining the necessary sanction.

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