Sanction under Section 197 Cr.P.C. mandatory for prosecuting public servants under PMLA

The court held that sanction under Section 197 Cr.P.C. is mandatory to prosecute public servants under the Prevention of Money Laundering Act for acts in the discharge of official duties. Cognizance taken without such sanction is invalid. The complaints were directed to be returned for resubmission with requisite sanction orders. The court emphasized adherence to procedural requirements and the need for proper authorization before prosecution of public servants under the PMLA.

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Issues Involved:
1. Whether the sanction under Section 197 Cr.P.C. is required to prosecute public servants under the Prevention of Money Laundering Act (PMLA), 2002.
2. Whether the cognizance taken by the Special Court without such sanction is valid.
3. The role and alleged involvement of the petitioners in the offences under the PMLA.

Issue-wise Detailed Analysis:

1. Requirement of Sanction under Section 197 Cr.P.C.:
The court examined whether the sanction under Section 197 Cr.P.C. is required for prosecuting public servants under the PMLA. It was concluded that the PMLA is not a complete code and the provisions of the Cr.P.C. apply unless they are inconsistent with the PMLA. Specifically, Section 65 of the PMLA states that the provisions of the Cr.P.C. apply to arrest, search, seizure, attachment, confiscation, investigation, prosecution, and all other proceedings under the PMLA. The court emphasized that the requirement of sanction under Section 197 Cr.P.C. is not inconsistent with the PMLA. Therefore, sanction is mandatory to prosecute public servants under the PMLA when the alleged acts are in the discharge of their official duties.

2. Validity of Cognizance Taken Without Sanction:
The court held that cognizance taken by the Special Court without the requisite sanction under Section 197 Cr.P.C. is invalid. The court referred to several precedents, including the Constitution Bench judgment in A.R. Antulay v. Ramdas Srinivas Nayak, which clarified that if the law requires sanction for prosecution, it must be obtained before taking cognizance. The court noted that the PMLA does not explicitly exclude the requirement of sanction for public servants. Consequently, the cognizance taken by the Special Court without sanction was deemed unsustainable and was set aside.

3. Role and Alleged Involvement of Petitioners:
The petitioners, being public servants, were alleged to have abused their official positions to show undue favors to certain companies, resulting in wrongful loss to the government and generating proceeds of crime. The court examined the specific roles and allegations against each petitioner:
- BP Acharya (Petitioner in Crl.P. Nos. 3988 of 2016 and 11942 of 2018): Alleged to have conspired with other accused to allot land at undervalued rates and transfer land without proper verification, causing a loss to the state exchequer. The court noted that the transactions were related to the discharge of his official duties and required sanction for prosecution.
- Adityanath Das (Petitioner in W.P. No. 2253 of 2018): Alleged to have allotted additional water to India Cements without following due procedure, causing wrongful loss to the government. The court observed that the actions were in the discharge of his official duties and required sanction for prosecution.

The court directed the Special Judge to return the complaints to the complainant(s) to resubmit them with the necessary sanction orders from the competent authority. The court also suspended the operation of the order for four weeks to allow for any further legal steps.

Conclusion:
The court concluded that the sanction under Section 197 Cr.P.C. is mandatory to prosecute public servants under the PMLA for acts done in the discharge of their official duties. The cognizance taken by the Special Court without such sanction is invalid. The complaints were directed to be returned for resubmission with the requisite sanction orders.

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