TaxTMI 
TaxTMI 
TaxTMI 
2024 (11) TMI 296
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....) of Section 197 of the Code of Criminal Procedure, 1973 (for short, 'the CrPC'). By the impugned judgment, the High Court upheld the respondents' contentions and quashed the orders of taking cognizance passed by the Special Court on the complaints only as against the said respondents. SUBMISSIONS 2. Shri S.V. Raju, learned Additional Solicitor General for India, appeared for the appellant-Enforcement Directorate. He submitted that in view of Section 71 of the PMLA, the provisions thereof have an overriding effect over the provisions of the other statutes, including the CrPC. He submitted that considering the object of the PMLA, the requirement of obtaining a sanction under Section 197(1) of CrPC will be inconsistent with the provisions of the PMLA. 3. He pointed out from the assertions made in the complaints that at the relevant time, the first respondent was the Vice Chairman and Managing Director of Andhra Pradesh Industrial Infrastructure Corporation Ltd. (for short, 'the Corporation'). His submission is that he was not a public servant within the meaning of Section 197(1) of CrPC, as it cannot be said that while holding the said position, he was not removable from the ....
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....he case may be, was at the time of commission of the alleged offence employed, in connection with the affairs of a State, of the State Government: [Provided that where the alleged offence was committed by a person referred to in clause (b) during the period while a Proclamation issued under clause (1) of Article 356 of the Constitution was in force in a State, clause (b) will apply as if for the expression "State Government" occurring therein, the expression "Central Government" were substituted.] [Explanation.-For the removal of doubts it is hereby declared that no sanction shall be required in case of a public servant accused of any offence alleged to have been committed under section 166A, section 166B, section 354, section 354A, section 354B, section 354C, section 354D, section 370, section 375, section 376 [section 376A, section 376AB, section 376C, section 376D, section 376DA, section 376DB] or section 509 of the Indian Penal Code (45 of 1860).] 6. The object of Section 197(1) must be considered here. The object is to protect the public servants from prosecutions. It ensures that the public servants are not prosecuted for anything they do in the discharge of their duties....
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....icial duty. If the answer to this question is in the affirmative, it may be said that such act was committed by the public servant while acting in the discharge of his official duty and there was every connection with the act complained of and the official duty of the public servant. This aspect makes it clear that the concept of Section 197 does not get immediately attracted on institution of the complaint case." (emphasis added) 8. In the decision of this Court in the case of Prakash Singh Badal and Another3, in paragraph 38, this Court held thus : "38. The question relating to the need of sanction under Section 197 of the Code is not necessarily to be considered as soon as the complaint is lodged and on the allegations contained therein. This question may arise at any stage of the proceeding. The question whether sanction is necessary or not may have to be determined from stage to stage." (emphasis added) In the present case, after completing the investigation, the appellant has filed exhaustive complaints under Section 44(1)(b) of the PMLA. Cognizance has been taken based on the complaints. Therefore, the issue of the absence of sanction will arise at this stage. 9....
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....ondent is that he, in conspiracy and connivance with Shri Y.S. Jagan Mohan Reddy (the then Chief Minister of the state), another accused, allotted 250 acres of land for the SEZ project to M/s. Indu Tech Zone Private Ltd. by violating the existing norms, regulations and procedures. Further allegation against the first respondent is that he was indirectly involved in the offence of money laundering by knowingly assisting M/s. Indu group of companies in the creation of vast proceeds of crime. The allegation against the second respondent, who was at the relevant time Principal Secretary, I & CAD Department of the State Government, is that in conspiracy with Shri Y.S.Jagan Mohan Reddy, he extended favour to India Cement Limited by allotting an additional 10 lakh litres of water from River Kagna without referring the matter to Interstate Water Resources Authority and by violating the existing norms, regulations and procedures. 14. A Bench of three Hon'ble Judges of this Court in the case of P.K. Pradhan v. State of Sikkim (2001) 6 SCC 704, in paragraphs 5 and 15 held thus: "5. The legislative mandate engrafted in sub-section (1) of Section 197 debarring a court from taking cognizance ....
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.... by the prosecution fails or the defence establishes that the act purported to be done is in discharge of duty, the proceedings will have to be dropped. It is well settled that question of sanction under Section 197 of the Code can be raised any time after the cognizance; maybe immediately after cognizance or framing of charge or even at the time of conclusion of trial and after conviction as well. But there may be certain cases where it may not be possible to decide the question effectively without giving opportunity to the defence to establish that what he did was in discharge of official duty. In order to come to the conclusion whether claim of the accused that the act that he did was in course of the performance of his duty was a reasonable one and neither pretended nor fanciful, can be examined during the course of trial by giving opportunity to the defence to establish it. In such an eventuality, the question of sanction should be left open to be decided in the main judgment which may be delivered upon conclusion of the trial." (emphasis added) Thus, there is no embargo on considering the plea of absence of sanction, after cognizance is taken by the Special Court of the ....
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.... do not find that there is any provision therein which is inconsistent with the provisions of Section 197(1) of CrPC. Considering the object of Section 197(1) of the CrPC, its applicability cannot be excluded unless there is any provision in the PMLA which is inconsistent with Section 197(1). No such provision has been pointed out to us. Therefore, we hold that the provisions of Section 197(1) of CrPC are applicable to a complaint under Section 44(1)(b) of the PMLA. 18. Section 71 gives an overriding effect to the provisions of the PMLA notwithstanding anything inconsistent therewith contained in any other law for the time being in force. Section 65 is a prior section which specifically makes the provisions of the CrPC applicable to PMLA, subject to the condition that only those provisions of the CrPC will apply which are not inconsistent with the provisions of the PMLA. Therefore, when a particular provision of CrPC applies to proceedings under the PMLA by virtue of Section 65 of the PMLA, Section 71 (1) cannot override the provision of CrPC which applies to the PMLA. Once we hold that in view of Section 65 of the PMLA, Section 197(1) will apply to the provisions of the PMLA, Sec....