AI Drafter 
TaxTMI 
TaxTMI 
2019 (9) TMI 162
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....r Advocate with Mr. Shivek Trehan, Advocate, Mr. Laksh Khanna, Advocate, Mr. Avishkar Singhvi with Mr. Kshitij Kumar Advocates. Respondents Through: Mr. Amit Mahajan, Mr. Ripu Daman Bhardwaj, Mr. Vinod Diwakar with Mr. Dhruv Pande and Ms. Mallika Hiramath, Advocates for UOI. Mr. Anil Grover, SPP for CBI with Mr. Shivesh P.Singh, Noopur Singhal and Mr. Mishal Vij, Advocates. J U D G M E N T MANMOHAN, J: (Oral) 1. The present batch of writ petitions seek to challenge the constitutional validity of Section 43 of the Foreign Contribution (Regulation) Act, 2010 (hereinafter referred to as 'FCRA') and Rule 22 of Foreign Contribution (Regulation) Rules, 2011 (hereinafter referred to as FCRR) on the ground that they are arbitrary, unreasonable, ultra vires and violative of Articles 14 and 21 of the Constitution of India. The petitioners further seek quashing of the letter dated 4th August, 2017 entrusting the investigation of their cases to the Central Bureau of Investigation (for short 'CBI'). The petitioners also seek quashing of the investigation being carried out by the CBI and Enforcement Directorate in pursuance to RCDAI-2017-A-0036 dated 16th November, 2017 (herein....
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....Director, Shri Raman Kapoor of M/s. Accordis Health Care Private Limited company had confessed before the Income Tax Authorities that he had booked bogus expenses and had indulged in over pricing of mobile medical units. CBI was requested to investigate whether the activities of the entities as stated in the said letter also attracted the provisions of other laws, i.e., IPC etc. for having diverted the funds for personal benefit of the office bearers or any other individuals apart from the violations of various provisions of FCRA. The letter dated 04th August, 2017 along with its annexures is reproduced hereinbelow:- "F.No.II/21022/58(0641)/2016-FCRA(MU)//S-3 Government of India Ministry of Home Affairs Foreigners Division (FCRA Wing) (Monitoring Unit) NDCC-II Building, Jai Singh Marg, New Delhi, the 4th August, 2017 To The Director, Central Bureau of Investigation, Plot No.5-B, CGO Complex, Lodhi Road, New Delhi-110003 Subject: Investigation under Section 43 of the FCRA, 2010 for contravention of FCRA-2010 by Advantage India, New Delhi-reg. Sir, M/s. Advantage India, 101-102, Oriental House, ....
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....tion vide its letter dated 27th June, 2017 claiming that the invoices of these firms were genuine was not found to be tenable. Independent enquiries made by the Income tax department in regard to the above two firms revealed that there was no such concerns at the given addresses and the amount received by these two firms from Advantage India were rotated through many bank accounts which prima facie were found to be bogus. The Income tax department has therefore found these two concerns as bogus and the expenses claimed on purchase of medicines from these two concern as fictitious and bogus. The facts on record clearly make out violation of Section 8(1)(a) (utilization of FC for the purpose it has been received), Section 18 (intimation), Section 19 (maintenance of accounts) and Section 33 of FCRA, 2010 (making of false statement, declaration or delivering false accounts). II. Agreements dated 05.10.2010, 18.12.2010 & 17.01.2013 with M/s. Accordis Health Care by the Association in support of its purchases of Mobile Medical Units/medicines etc. From the said company were verbatim, self-serving, full of contradictions and appeared to have been made on same day but signed for d....
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....s is in a violation of Section 12(4)(vi) and Section 33 of the FCRA. VI. During the scrutiny of agreements, it was observed that the Association has given the following two bank account numbers while signing the agreements:- S.No. Donor Name Bank Name Account Number Address of Branch 1. AIRBUS Indian Overseas 0265020000 02166 70 Golf Link New Delhi 2. MBDA Indian Overseas 0265020000 02377 70 Golf Link New Delhi Received foreign contribution in more than one FCRA designated bank account is violation of Section 17 under FCRA, 2010. In the instant matter the Association has not intimated Government about opening of more than one account for the purpose of utilizing the foreign contribution. The Association has admitted the facts stating that it was done due to ignorance of provisions of FCRA, 2010. The reply of Association is not acceptable because ignorance of law is no excuse. Moreover, the Association has claimed to have been taking financial advice from professionals. Thus Associations violated Section 17 under FCRA, 2010 on both counts. VII. The Association has transferred considerable do....
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.... and utilization of FC amounting more than one crore in the public domain. The reply of the Association is of routine nature and shows casualness of highest order. Thus Association violated Rule 13 under foreign Contribution (Regulation) Rules, 2011. 2. Advantage India, New Delhi, has violated various provisions of FCRA Act 2010. It is a fit case for detailed investigation and criminal prosecution if found fit. The Central Bureau of Investigation (CBI) is, therefore, requested to conduct an investigation in terms of Section 43 of FCRA, 2010. CBI may also investigate whether the activities of these entities also attract the provisions of other penal laws i.e. IPC etc. For having diverted the funds for personal benefit of the officer bearer or any other individual. 3. It is requested that the investigation report in the matter may kindly be submitted to the Ministry at the earliest. Further, in terms of Rule 22 of Foreign Contribution (Regulation) Rules¸2011, the CBI is required to furnish reports to the Central Government on quarterly basis, indicating the status of each case that was entrusted to it, including information regarding the case number, date of r....
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....pur, New Delhi 20.39 For acquiring mobile medical vans 2. M/s. Accordis Health Care Pvt. Ltd. main Mandi Road, Jonpur, New Delhi 21.41 Service charges for providing doctor, nurses, support staff in mobile medical vans 3. M/s. Hind Pharma Chandni Chowk, New Delhi 10.91 For purchase of medicines 4. M/s Asha Pharma, Ring Road, New Delhi 16.06 For purchase of medicines 5. Payment made to M/s. Capital Print process & M/s. Capital Impex, New Delhi 4.93 For printed exercise note book 6. Purchase of expensive vehicles i.e. Toyota, Duster, Regent Garage .84 7. Office rent paid to Sh. Deepak Talwar .80 Former President of the association 8. Foreign tour expenses paid to Sh. Deepak Talwar .30 Former President of the association 9. Payment made to consultant M/s. T. Kapoor 1.04 Consultancies charges G.T. 76.68 (emphasis supplied) 3. The letter dated 04th August, 2017 became the basis of registration of FIR bearing No. RC 36/2017 under Sections 33, 35 and 37 of FCRA and Sections 120B/199/468/471/511 read with Section 417 of IPC with Anti Co....
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....I/21022/58 (0641)/2016-FCRA (MU)//S-3 dtd. 4.8.17 lodged by Sh.Santosh Sharma Director (FC&MU) was received in CBI which is annexed as attachment to column no.12. MHA has requested to conduct investigation in terms of Section 43 of FCRA, 2010. The analysis of the complaint prima facie revealed commission of offence U/s 120B, 199, 468, 471,511 r/w 417 IPC & U/s 33, 35, 37 FCRA 2010 against M/s Advantage India. M/s Accordis Health Care Pvt. Ltd. Sh. Deepak Talwar, Sh. Sunil Khandelwal, Sh.Raman Kapoor and T.Kapoor & other unknown persons. Hence, a regular case is registered against M/s Advantage India, M/s Accordis Health Care Pvt. Ltd. Sh. Deepak Talwar, Sh. Sunil Khandelwal, Sh.Raman Kapoor and T.Kapoor & other unknown persons U/s 120B, 199, 468, 471, 511 r/w 417 IPC & U/s 33, 35 & 37 of FCRA Act 2010 and entrusted to Sh. Shyam Prakash, Dy. SP, CBI, ACB, New Delhi for investigation." 4. CBI states that investigation is underway to verify the claimed supply of medicines, stationery and medical units worth more than Rupees Seventy Two crores and as to who were allegedly involved in fabrication of false documents and opening of bank accounts apart from id....
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.... 26 and 42 of FCRA, investigation can also be done by CBI or Crime Branch officials, as the case may be, subject to the fact that authorization is issued in their favour at the very inception/first instance. In support of their submission, learned counsel for petitioners rely upon the Supreme Court's judgment in Directorate of Enforcement vs. Deepak Mahajan & Anr., (1994) 3 SCC 440 wherein it has been held as under:- "113. Though an authorised officer of Enforcement or Customs is not undertaking an investigation as contemplated under Chapter XII of the Code, yet those officers are enjoying some analogous powers such as arrest, seizures, interrogation etc. Besides, a statutory duty is enjoined on them to inform the arrestee of the grounds for such arrest as contemplated under Article 22(1) of the Constitution and Section 50 of the Code. Therefore, they have necessarily to make records of their statutory functions showing the name of the informant, as well as the name of the person who violated any other provision of the Code and who has been guilty of an offence punishable under the Act, nature of information received by them, time of the arrest, seizure of the contraband i....
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....erms of the Code in the field of FERA or Customs Act, Section 4(2) of the Code can have no part to play, has to be rejected for the reasons given by us while disposing of the contention "What investigation means and is" in the preceding part of this judgment." 6. Learned counsel for petitioners submit that the Central Government cannot pick and choose, according to their whims and fancies, the investigative agency, i.e., whether the investigation should be carried out by the officer authorised by the Central Government or the CBI under Section 43 of FCRA. They submit that the manner in which the respondents seek to implement the provisions of Section 43 of FCRA and Rule 22 of FCRR confers uncontrolled or unguided power upon the respondents, which renders Section 43 manifestly arbitrary, unreasonable, ambiguous, unconstitutional and ultra vires on the vice of Articles 14 and 21 of the Constitution of India. Learned counsel for the petitioners suggest that the condition precedent of "recording of reasons" as envisaged under Section 23 FCRA should be read into Section 43 to render it constitutional. In support of their submission, they rely upon Supreme Court's judgment in State of....
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.... or things to whom its provisions are to apply. In determining the question of the validity or otherwise of such a statute the Court will not strike down the law out of hand only because no classification appears on its face or because a discretion is given to the Government to make the selection or classification but will go on to examine and ascertain if the statute has laid down any principle or policy for the guidance of the exercise of discretion by the Government in the matter of the selection or classification. After such scrutiny the Court will strike down the statute if it does not lay down any principle or policy for guiding the exercise of discretion by the Government in the matter of selection or classification, on the ground that the statute provides for the delegation of arbitrary and uncontrolled power to the Government so as to enable it to discriminate between persons or things similarly situate and that, therefore, the discrimination is inherent in the statute itself. In such a case the Court will strike down both the law as well as the executive action under such law." 7. They also contend that in view of the prior registration of RC 9/2013 and ECIR 10/2017, t....
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....apati's case, the 'larger conspiracy' would be established and the mandate and tasks assigned by this Court to CBI would be accomplished both in letter and spirit towards the goal of a fair trial, upholding the rule of law. If Tulsiram Prajapati's fake encounter case is not transferred to CBI for investigation, it may lead to issue estoppel or res judicata against the prosecution. xxx xxx xxx xxx 30. As pointed out by the learned counsel for the petitioner and CBI, the said judgment records that there is strong suspicion that the 'third person' picked up with Sohrabuddin was Tulsiram Prajapati. ... 31. ... Pursuant to the said direction, CBI investigated the cause of death of Sohrabuddin and his wife Kausarbi. CBI, in their counter-affidavit, has specifically stated that as per their investigation Tulsiram Prajapati was a key witness in the murder of Sohrabuddin and he was the 'third person' who accompanied Sohrabuddin from Hyderabad and killing of Tulsiram Prajapati was a part of the same conspiracy. It was further stated that all the records qua Tulsiram Prajapati's case were crucial to unearth....
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....ions and directions cannot lightly be taken note of and it is the duty of CBI to go into all the details as directed by this Court. xxx xxx xxx xxx 47. If we analyse the allegations of the State and other respondents with reference to the materials placed with the stand taken by CBI, it would be difficult to accept it in its entirety. It is the definite case of CBI that the abduction of Sohrabuddin and Kausarbi and their subsequent murders as well as the murder of Tulsiram Prajapati are one series of acts, so connected together as to form the same transaction under Section 220 CrPC. As rightly pointed out by CBI, if two parts of the same transaction are investigated and prosecuted by different agencies, it may cause failure of justice not only in one case but in other trial as well. 48. It is further seen that there is substantial material already on record which makes it probable that the prime motive of elimination of Tulsiram Prajapati was that he was a witness to the abduction of Sohrabuddin and Kausarbi. xxx xxx xxx xxx 65. ... In v....
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....d to have been committed in the course of the same transaction and in respect of which pursuant to the first FIR either investigation is under way or final report under Section 173(2) has been forwarded to the Magistrate, may be a fit case for exercise of power under Section 482 CrPC or under Articles 226/227 of the Constitution." The above referred declaration of law by this Court has never been diluted in any subsequent judicial pronouncements even while carving out exceptions. xxx xxx xxx 47. The learned ASG placed reliance on the following decisions: (i) Anju Chaudhary v. State of U.P. (ii) Babubhai v. State of Gujarat, (iii) sender Kaushik v. State of U.P., (iv) Nirmal Singh Kahlon v. State of Punjab, (v) Ram Lal Narang v. State (Delhi Admn.), (vi) Upkar Singh v. Ved Prakash and (vii) Kari Choudhary v. Sita Devi. 48. In Anju Chaudhary this Court was concerned with a case in which the second FIR was not connected with the offence alleged in the first FIR. After carefully analysing the same, we are of the view that it has ....
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....ly impermissible. In Joint Action Committee of Air Line Pilots' Assn. of India v. DG of Civil Aviation [(2011) 5 SCC 435] this Court declared that even senior officials cannot provide any guidelines or direction to the authority under the statute to act in a particular manner. 21.2.Secondly, because exercise of the power vested in the District Superintendent of Police under Section 20-A(1) would involve application of mind by the officer concerned to the material placed before him on the basis whereof alone a decision whether or not information regarding commission of an offence under TADA should be recorded can be taken. Exercise of the power granting or refusing approval under Section 20-A(1) in its very nature casts a duty upon the officer concerned to evaluate the information and determine having regard to all attendant circumstances whether or not a case for invoking the provisions of TADA is made out. Exercise of that power by anyone other than the Designated Authority viz. the District Superintendent of Police would amount to such other authority clutching at the jurisdiction of the designated officer, no matter such officer or authority purporting to exercise t....
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....nding of all the offences under FCRA, the said offences under FCRA are compoundable. Furthermore, Section 41 of FCRA is a unique provision as it allows compounding before initiating prosecution. 11. They submit that Section 43 of FCRA being an enabling provision permitting exercise of the same powers in respect of the investigation in FCRA as an officer in-charge of a police station may exercise in a cognizable offence, would not make the offences under FCRA 'cognizable offences' or give CBI 'through the back door' the authority to arrest. 12. They lastly submit that FCRA is a special law dealing with a special field and hence general law cannot be applied. They state that Sections 33, 35 and 37 encompass and imbibe the substance and spirit of penal provisions pertaining to cheating, forgery of documents, falsification and fabrication of records, criminal misappropriation and hence, external penal provisions under Sections 199, 468, 471 and 511, IPC cannot be invoked qua FCRA. They emphasise that Section 40 of the FCRA provides for sanction for prosecution of only the offences mentioned under the FCRA which contemplates the procedure of a complaint case and does not provide f....
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....s out that the petitioner-M/s. Advantage India in the present cases has preferred a revision petition challenging the order of cancellation of registration passed by the Central Government under Section 14 of FCRA. 16. Learned standing counsel for Union of India further states that Chapter VIII of FCRA defines offences and penalties which are in addition to the action Central Government may take under Section 14 of the FCRA. In support of his submission, he relies upon Sections 33, 34, 35 36, 37 and 38 of FCRA. He submits that the notified investigative agency does not require a separate sanction under Section 40 of the FCRA for the purpose of investigation, as suggested by the petitioners. He, however, admits that Section 40 of FCRA provides that no court shall take cognizance of any offence under the FCRA, except with the prior sanction of the Central Government or any other officer authorised by the Central Government. He points out that vide Notification dated 27th October, 2011, the Central Government, in exercise of powers under Section 40 of FCRA, has already notified Union Home Secretary and Home Secretaries of the State Governments, as the case may be, as sanctioning au....
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....on Chapter VIII of the FCRA. He submits that under Section 23 of FCRA, the role assigned to an officer or authority is of civil nature and limited only to carrying out book inspection of accounts/records as required and authorized under Chapter V of the FCRA. He further submits that the officer is authorized under Section 23 of the FCRA with power of search and seizure etc., however, he/she is not authorized to undertake any investigation into commission of offences under the FCRA, particularly when the Central Government vide notification dated 27th October, 2011 has already specified such authorities. 20. He emphasises that since the very inception of the FCRA and more particularly since the notification dated 27th October, 2011, all the criminal investigations in relation to commission of offences under Chapter VIII of the FCRA have been carried out only by the agencies as notified in the above said notification by registering an appropriate FIR. In support of his contention, Mr. Mahajan, during the course of arguments had handed over an additional affidavit dated 08th August, 2019. Consequently, learned standing counsel for Union of India and Enforcement Directorate submits ....
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....hat there is no dispute regarding carrying out investigation of offences committed under IPC by the CBI. He reiterates that as far as investigation under FCRA is concerned, the Central Government vide Notification dated 27th October, 2011 has authorised CBI to carry out investigation of offences committed under FCRA involving receipt of foreign contribution of an amount of Rs. 1 crore or equivalent or more. 26. He emphasises that there is no duplicity of actions taken under Chapter V, VI and Section 43 of FCRA as offences punishable under the said Act as mentioned in Chapter VIII, can only be investigated by the authorities specified under Section 43 of FCRA. He states that perusal of Section 43 of FCRA shows that the offences under the Act have to be investigated as cognizable offence irrespective of anything contained in Code of Criminal Procedure. 27. He also points out that the Central Government by Notifications dated 26th August, 2011 and 16th June, 2016 has notified the offences under the FCRA that can be compounded on payment and in view of the said Notifications, offences under Sections 33, 35 and 37 of FCRA cannot be compounded in terms of Section 41 of FCRA. REJ....
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....and offences under Chapter VIII of FCRA along with offences under the IPC and accordingly, the cases of the petitioners fall in a separate class and were therefore referred to the CBI for investigation. The relevant paragraphs of the affidavit dated 22^nd August, 2019 are reproduced hereinbelow:- "3. It is further submitted that there are multiple compliances that a registered NGO has to ensure under the FCRA, 2010. One of them relates to filing of Annual Returns which are in the nature of self-declaration by the Chief Functionary of the NGO and their Chartered Accountant. A very large majority of thousands of NGOs/associations whose certificates of registration have been cancelled belong to this category, i.e. they have not filed their mandatory Annual Returns. This offence has been notified as compoundable under Section 41 of the FCRA since June, 2016. Similarly, the offence of acceptance of foreign contribution without registration or prior permission of Central Govt. has also been notified as a compoundable offence since August, 2011. On June 5, 2018, Central Govt. notified a comprehensive compounding scheme which deals with compounding of minor violations of civil nat....
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....widened. D.D. Basu in Shorter Constitution of India (14th Edn., 2009) has detailed, with reference to various judgments of this Court, the grounds on which the law could be invalidated or could not be invalidated. Reference to them can be made as follows: "Grounds of unconstitutionality.- A law may be unconstitutional on a number of grounds: (i) Contravention of any fundamental right, specified in Part III of the Constitution. (Ref. Under Article 143: Special Reference No. 1 of 1964, In re.) (ii) Legislating on a subject which is not assigned to the relevant legislature by the distribution of powers made by the Seventh Schedule, read with the connected articles. (Ref. Special Reference No. 1 of 1964, In re [AIR 1965 SC 745 : (1965) 1 SCR 413] .) (iii) Contravention of any of the mandatory provisions of the Constitution which impose limitations upon the powers of a legislature e.g. Article 301. (Ref. Atiabari Tea Co. Ltd. v. State of Assam.) (iv) In the case of a State law, it will be invalid insofar as it seeks to operate beyond the boundaries of the State. (State of Bombay v. R.M.D. Chamarbaugwala.) (v) That the legislature con....
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....ndication clearly given in the statutes one expects the officers concerned to avail themselves of the procedures prescribed by the Acts and not resort to the dilatory procedure of the ordinary civil court. Even normally one cannot imagine an officer having the choice of two procedures, one which enables him to get possession of the property quickly and the other which would be a prolonged one, to resort to the latter. Administrative officers, no less than the courts, do not function in a vacuum. It would be extremely unreal to hold that an administrative officer would in taking proceedings for eviction of unauthorised occupants of Government property or Municipal property resort to the procedure prescribed by the two Acts in one case and to the ordinary civil court in the other. The provisions of these two Acts cannot be struck down on the fanciful theory that power would be exercised in such an unrealistic fashion. In considering whether the officers would be discriminating between one set of persons and another, one has got to take into account normal human behaviour and not behaviour which is abnormal. It is not every fancied possibility of discrimination but the real risk of di....
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....entral Government hereby specifies that the officers not below the rank of Sub-Inspector of Police of the following organisations shall be the authorities for investigation of offences punishable under the said Act:- (i) Investigating Agencies (Crime Branch) of the State Governments, cause of action which arises in their respective States in respect of the offences that involve a prima facie violation of the provisions of the Foreign Contribution (Regulation) Act, 2010 (42 of 2010) with regard to receipt of foreign contribution of an amount of less than one crore rupees or equivalent; (ii) Central Bureau of Investigation (CBI) with regard to offences that involve a prima facie violations of the Foreign Contribution (Regulation) Act, 2010 (42 of 2010) involving receipt of foreign contribution of an amount of one crore rupees or equivalent or above and in any other case which may be specifically entrusted to the CBI by the Central Government under the said Act. [F.No. II/21022/10(1)/2010-FC-III] GV.V. SARMA, Jt. Secy." B. Additional Affidavit on behalf of UOI dated 08th August, 2019 "2. It is humbly submitted that the ambit and scope of sections 23....
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.... lay down a principle and/or policy in the matter of appointment/selection of an investigative agency under Section 43 of FCRA and saves it from attack on the ground that it violates Articles 14 and 21 of the Constitution. NEGATIVE EQUALITY IS NOT A VALID LEGAL GROUND 38. Just because out of thirteen thousand NGOs, whose licences had been cancelled under FCRA, only thirty two had been referred to CBI for investigation, this Court is of the view that the petitioner cannot claim negative equality and that too without disclosing the nature of violations by the thirteen thousand NGOs. 39. In a catena of judgments, it has been held that negative equality is not a valid legal ground. In Union of India and Others vs. M.K. Sarkar, (2010) 2 SCC 59, the Supreme Court has held as under:- "25. There is another angle to the issue. If someone has been wrongly extended a benefit, that cannot be cited as a precedent for claiming similar benefit by others. This Court in a series of decisions has held that guarantee of equality before law under Article 14 is a positive concept and cannot be enforced in a negative manner; and that if any illegality or irregularity is committed in fa....
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....ers under Sections 23 to 26 and 42 of FCRA only while carrying out the inspection. The relevant portion of the authorisation letter dated 07th February, 2017 issued under Section 23 of FCRA is reproduced hereinbelow:- "GOVERNMENT OF INDIA/BHARAT SARKAR MINISTRY OF HOME AFFAIRS/GRIH MANTRALAYA FOREIGNERS DIVISIN/VIDESHI VIBHAG (FCRA WING) ............ Dated 07 Feb'2017 AUTHORISATION UNDER SECTION 23 OF THE FOREIGN CONTRIBUTION (REGULATION) ACT, 2010. XXXXXX Now, the Central Government, by virtue of the powers conferred under Section 23 of the FCRA, 2010 authroize Ms. Anjana, Under Secretary (MU), FCRA, MHA,...........inspect account or record maintained by the said association.......... The authorized officers shall exercise powers conferred on them under Section 23 to 26 and 42 of the FCRA, 2010 while carrying out the inspection of the accounts/records of the said association. Sd/- (Anuj Sharma) Director (FC&MU)" (emphasis supplied) 41. The letter dated 04th August 2017, issued by the Ministry of Home Affairs, FCRA Wing, signed by the Director (FC & MU), states that the inquiry conducted by the Ministry had prima facie revealed ....
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.... authorized under Section 23 FCRA did not have any power to investigate offences under Chapter VIII, the judgment in Directorate of Enforcement vs. Deepak Mahajan & Anr. (supra) does not apply to the present cases. 48. Consequently, the officer authorised to carry out inspection of records and accounts under Section 23 of FCRA in the present cases was authorised and had carried out inspection and enquiry only under Chapter V of FCRA. TO CONTEND THAT WHOSOEVER IS AUTHORIZED TO INSPECT IS VESTED WITH COMPLETE POWER TO INVESTIGATE IS NOT CORRECT. INVESTIGATION UNDER CHAPTER VIII CAN BE TRANSFERRED TO THE SPECIALISED AGENCIES LIKE CBI 'MIDSTREAM'. 49. To contend that whosoever is authorized to inspect is vested with complete power to investigate under Chapter VIII of FCRA is not correct. Though there is no statutory prohibition that inquiry and investigation cannot be carried out by the same authority, yet it is known to law that inquiry and investigation can be carried out by different authorities. At times inquiry report giving prima facie findings leads to subsequent criminal investigation by police or specialised agencies. For instance, departmental inquiry report concludi....
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....il is the rule and jail is an exception'. 53. In any event, absence of power to arrest, if any, cannot be a ground either for seeking declaration that Section 43 of FCRA is ultra vires or for quashing of the impugned FIR. IN THE PRESENT CASES, ALL THE OFFENCES WHICH ARE MENTIONED IN THE RC 36/2017 ARE NOT NON-COGNIZABLE BY VIRTUE OF PART-II OF FIRST SCHEDULE OF CR.P.C. FURTHER NOT ALL OFFENCES PUNISHABLE WITH IMPRISONMENT OR WITH FINE ARE NON-COGNIZABLE. MOREOVER, AS THE CASE RELATES TO TWO OR MORE OFFENCES OF WHICH AT LEAST ONE IS COGNIZABLE, THE CASE BY VIRTUE OF SECTION 155 (4) CR.P.C. SHALL BE DEEMED TO BE A COGNIZABLE CASE NOTWITHSTANDING THAT THE OTHER OFFENCES ARE NON-COGNIZABLE. 54. In the present cases, all the offences which are mentioned in the RC 36/2017 are not non-cognizable by virtue of Part-II of First Schedule of Cr.P.C, as contended by the learned counsel for the petitioners, because as per Schedule II of Cr.P.C., if any offence is punishable with imprisonment for less than three years or with fine, then only it shall be classified as non-cognizable. In the present cases, the impugned RC 36/2017 had been registered even under Section 35 of FCRA which prov....
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....der FCRA will have to be investigated as cognizable offences irrespective of anything contained in the Cr.P.C. OFFENCES MENTIONED IN FCRA ESSENTIALLY RELATE TO MISUTILISATION OF THE FOREIGN CONTRIBUTION AND GIVING FALSE INFORMATION, WHEREAS THE OFFENCES IN IPC LIKE SECTION 468 RELATE TO FORGING OF THE DOCUMENTS FOR PURPOSE OF CHEATING. CONSEQUENTLY, IPC OFFENCES ARE NOT SUBSUMED IN OFFENCES UNDER FCRA. IN ANY EVENT, THIS CANNOT BE A GROUND TO CHALLENGE CONSTITUTIONAL VALIDITY OF THE PROVISIONS OF FCRA. 58. The argument of the petitioners that Sections 33, 35 and 37 of FCRA encompass and imbibe the substance and spirit of penal provisions and hence, external penal provisions like Sections 199, 468, 471 and 511 IPC cannot be invoked is untenable in law. This Court is of the view that offences mentioned in FCRA essentially relate to mis-utilisation of the Foreign Contribution and giving false information, whereas the offences in IPC like Section 468 relate to forging of the documents for purpose of cheating. Consequently, IPC offences are not subsumed in offences under FCRA. 59. Even if it is assumed that some of the IPC offences mentioned in the FIR overlap with the offences....