Continuing offence limitation and section 197 sanction principles governed prosecution of bank officials in non-conforming user cases.

Non-conforming user prosecutions were treated as involving a continuing offence, so limitation under the Criminal Procedure Code was assessed by reference to the continuing nature of the breach and the exclusions applicable for notice and sanction; on that basis, the complaints were within time. Prior sanction under section 197 CrPC was held unnecessary because the chairman and directors of nationalised banks were not treated as qualifying public servants acting in discharge of official duty for that purpose. The article states that both limitation and sanction objections failed, and the prosecutions were upheld on those grounds.

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Issues: (i) Whether the prosecutions for non-conforming user were barred by limitation. (ii) Whether prior sanction under section 197 of the Criminal Procedure Code, 1973 was required for prosecuting the chairman/directors of the banks.

Issue (i): Whether the prosecutions for non-conforming user were barred by limitation.

Analysis: Non-conforming user under section 29(2) of the Delhi Development Act, 1957 was treated as a continuing offence. For a continuing offence, a fresh period of limitation arises while the offence continues, and the bar under section 468 of the Criminal Procedure Code, 1973 is to be tested at the stage of cognizance. The period consumed in issuing notice and obtaining the requisite sanction was also liable to be excluded under section 470(3) of the Criminal Procedure Code, 1973. On either basis, the complaints were within time.

Conclusion: The plea of limitation failed and was decided against the petitioners.

Issue (ii): Whether prior sanction under section 197 of the Criminal Procedure Code, 1973 was required for prosecuting the chairman/directors of the banks.

Analysis: Section 197 applies only where the accused is a public servant not removable from office save by or with the sanction of the appropriate Government and the alleged offence was committed while acting or purporting to act in the discharge of official duty. The chairmen/directors of the nationalised banks were held not to be servants or employees of the bank in the relevant sense, not holders of an office involving discharge of official duty in the statutory sense, and not persons employed in connection with the affairs of the Union for this purpose. The offence was treated as one committed by the bank, with liability fastened on the chairmen by the Act, rather than as an act done by them in official duty attracting section 197.

Conclusion: No sanction under section 197 of the Criminal Procedure Code, 1973 was required and the plea was rejected.

Final Conclusion: Both revision petitions failed on the two substantive grounds urged, and the challenge to the prosecutions was rejected.

Ratio Decidendi: In prosecutions for a continuing offence, limitation is computed with the statutory exclusions for notice and sanction, and section 197 of the Criminal Procedure Code, 1973 applies only where the accused is a qualifying public servant and the offence was committed in discharge of official duty.

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