STATE (ANTI CORRUPTION BRANCH) GOVT. OF N.C.T. OF DELHI AND ANR.versusDR. R.C. ANAND AND ANR.

     STATE (ANTI CORRUPTION BRANCH) GOVT. OF N.C.T. OF                            A
                     DELHI AND ANR.
                                      v.
                      DR. R.C. ANAND AND ANR.

                              APRIL 15, 2004
                                                                                  B
          [DORAISWAMY RAJU AND ARIJIT PASAYAT, JJ.]


     Prevention of Corruption Act, 1988; Section 19/All India Institute of
Medical Sciences Regulations, 1999; Schedule-11/Code ofCriminal Procedure,        C
1973; Section 482:

      Demand of illegal gratification by an employee from a Supplier for
renewal of contract-Tape-recording of conversation-Complaint-Anti
Corruption Bureau laid a trap, caught the employee red-handed-He was
placed under suspension-Sanction to prosecute not recommended by the              D
Ministry of Law & Justice and the Central Vigilance Commission-Declining
to grant the sanction President ofthe institute revoked the order of suspension
subject to its ratification by the Governing Body/authority-However, the
authority concerned did not ratify the order of the President-Challenge to--
Allowed by High Court holding that the authority could not supersede the
decision of the President-On appeal, Held: High Court proceeded on the            E
wrong premise that the decision arrived at by the President was in the capacity
ofthe sanctioning authority but under the Regulations the sanctioning authority
was the Governing Body-President has no role to play -Recording ofreasons
by the authority to differ from the order of the President not necessary-Since
the authority had considered all the material and evidence on record, Order       F
passed by it meeting the requirement of law-Hence, judgment of the High
Court not sustainable and set aside-No view expressed on the merits of the
case-Trial Court to proceed in accordance with law-Directions issued.

     A Contractor supplying materials to All India Institute of Medical
Sciences (Institute) filed a complaint against Respondent No.1 alleging that      G
he was demanding illegal gratification for renewal of the contract. In this
connection, the complainant had tape-recorded the conversation between
himself and Respondent No. 1 and approached the Anti Corruption
Branch. It laid a trap and caught Respondent No.1/employee red-handed

                                     161                                          H
     162                      SUPREME COURT REPORTS [2004] SUPP. I S.C.R.

A and he was placed under suspension. In the meanwhile, the appellant
     sought for sanction for prosecuting the errant employee. The Institute in
     turn sought certain clarifications from the Ministry of Law and Justice,
     Government of India and Central Vigilance Commission. They did not
     grant sanction to prosecute the employee. President of the Institute passed
B    an order revoking the order of suspension subject to its ratification by
     the Governing Body. However, the Governing Body granted the sanction
     and placed Respondent No.I under suspension. Aggrieved, he filed a writ
     petition and High Court quashed the order. Hence, the present appeal.

           It was contended by the appellant that since the Governing Body was
C    Appointing Authority as well as disciplinary authority in respect of
     Respondent No.l, only it has the authority to grant sanction to prosecute
     him, and since the President of the I~stitute has no role to play~ recording
     of reasons by the Governing Body for departing from the opinion of the
     President was not necessary.

D         Respondent submitted that the view of the President should not ~ave
     been ignored by the Governing Body; and that it was imperative for the
     Governing Body to apply its mind while granting sanction to prosecute
     the employee.

           Partly· all?wing the appeal, the Court
E
         HELD: 1.1. High Court proceeded on the pre~ise that the
   sanctioning authority has to apply its own independent mind, and it was
   applied by the President and he sought for ratification by Governing Body.
   The approach was clearly erroneous as the sanctioning authority was the
   Governing Body and not the President. When the Authority competent
F to accord sanction is the G.overning Body under the statutory Regulations
   and that body takes a decision there was no necessity for recording reasons
   to differ from the view expressed by the President who had legally no role
   to play. The allocation of· powers distinctly made by the statutory
   Regulations earmarking their own fields, subjects and topics cannot be
G legitimately ignored, on any assumptions or baseless_ presumptions. There
  ·is no justification in law or any principle of construction to import any
   restriction on the independent exercise of power by the earmarked
   Authority on its own under the Regulations. The President cannot impede
   or foreclose the liberty of the Governing Body by expressing his view or
   by passing even a provisional order subject to ratification, wherein under
.H
            STATE(ANTICORRUP. BRANCH) GOVT. OFN.C.T. OF DELHI v.R.C. ANAND   -163

the statutory Regulations, he had none, at all. There was no question of            A
any ratification involved as wrongly assumed by the High Court.
                                                   (167-A-B-C-D-E-F-G)

       1.2. The validity of the sanction would depend upon the material
placed before the sanctioning authority and the fact that all the relevant
facts, material and evidence including the transcript of the tape record            B
have been considered by the sanctioning authority. Consideration implies
application of mind. The order of sanction must ex facie disclose that the
sanctioning authority had considered the evidence and other material
placed before it. This fact can also be established by extrinsic evidence by
placing the relevant files before the Court to show that all relevant facts         C
were considered by the sanctioning authority. The counter affidavit of the
present appellant before the High Court clearly indicated that relevant
aspects were noted by the Governing Body, the sanctioning authority
before arriving at its decision. Thus the order passed by the Governing
Body cannot be said to be deficient in any way in meeting the requirements
of law. Hence, the High Court's judgment is indefensible and is quashed.            D
rt is clarified that no opinion is expressed on the merits of the case. The
matter pending before the Special Judge shall be proceeded in accordance
with law. (168-C-D-E-FJ

      Jaswant Singh v. State of Punjab, AIR (1958) SC 124; State of Bihar
v. P.P. Sharma, (19921Supp1SCC222 and Mansukhlal Vithaldas Chauhan                  E
v. State of Gujarat, [1997) 7 SCC 622, relied on.

     Kalpnath Rai v. State, (through CBI), (1997) 8 SCC 732, referred to.

     CRIMINAL APPELLATE JURISDICTION : Criminal Appeal No.
478 of 2004.                                                                        F

      From the Judgment and Order dated 27.5.2003 of the Delhi High Court
in Cr!. W.P. No. 260 of 2000.

     Rajeev Shanna and Mrs. Anil Katiyar for the Appellants.
                                                                                    G
     K. Ramamoorthy, Sri Ram J. Thalapathy, G.D. Gupta, Mrs. Shoobha
Nagarajan, Sudhir Nandrajog, Mukul Gupta, Ekram Ali and Ankur Jain for
the Respondent.

      TJ:ie Judgment of the Court was delivered by
                                                                                    H
    164                       SUPREME COURT REPORTS [2004) SUPP. I S.C.R.

A         ARIJIT PASAYAT, J. Leave granted.

           By.the impugned judgment a Division Bench of the Delhi High Court
    held that the sanction granted by the Governing Body of All India Institute
    of Medical Sciences (in· short the 'AIIMS') to proceed against respondent
    no. I-employee was legally not sustainable. Accordingly the proceedings
B   pursuant to the said sanction were quashed. The High Court was of the view
    that when the President who is the Chairman of the Governing Body had
    suggested that sanction was not to be granted, it was not open to the Governing
    Body to pass an order directing grant of sanction. The President had directed
    the matter to be placed before the Governing Body, it was incumbent upon
C   the latter to examine that question alone and if a contrary view was to be
    taken, that was subject to passing of a reasoned order showing application of
    mind. Since that was not done, the order of the Governing Body was vulnerable
    and deserved to be nullified. Further the order of suspension, which was
    passed and was continued, was vacated on the ground that same was continuing
    for a long time without a review of the necessity for continuance thereof.
D
         · Since the pivotal question is whether the Governing Body's decision
    suffered from any infirmity, a brief reference to the factual background would
    suffice.

          On 8.5.1998 a complaint was registered against respondent no. I on the
E   basis of allegations made by one Sagir Ahmad Khan who was supplying
    materials to AIIMS. It was alleged in the complaint that the respondent no.
     I had demanded illegal gratification for reviewing an order of cancellation
    and for placing orders to inake further supplies by renewal of contract. The
    complainant produced cassettes of tapes containing recorded conversation
F   between himself and the respondent no. I. The transcript of the same was
    prepared and placed on record. On 20. 7.1998 the complainant approached
    the Anti Corruption Branch (for short 'ACB') after fixing the time and the
    amount of money with respondent No. I. The c~mplainant produced currency
    notes of Rs. I 0,000 before an officer of the ACB. The investigating officer
    prepared several memos, recorded the number of notes and applied
G   PhenoTphthalein powder on the notes and told the complainant and the panch
    witnesses about the procedure to be adopted. A remote tape recording system
    was used to collect additional evidence for laying the trap. On the basis of
    the conversation recorded and after the acceptance of money by the respondent
    No. I, recovery was made and positive tests indicating presence of
H   Phenolphthalein in the colourless solution of sodium carbonate was noted. A
          STATE(ANTICORRUP. BRANCH) GOVT. OFN.C.T. OF DELHI v.R.C. ANAND[PASAYAT, J.]   165

positive report from the Forensic.. Science Laboratory was also received                      A
regarding hand wash and pant pocket wash. Though a similar procedure was
intended for another person same could not be materialised as the situation
at AIIMS turned violent.

      By an order dated 29.7.1998 respondent No. I was placed ~nder
suspension by the AIIMS with effect from 20.7.1998. The appellant No. l                       B
requested AIIMS for a sanction for prosecuting respondent No. l. AIIMS
sought certain clarification from the Ministry of Law and Justice and the
Central Vigilance Commission (in short the 'CVC'). They did not recommend
grant of sanction to prosecute. The President of AIIMS passed an order on
22.3.2000 revoking the order of suspension, and declining grant of sanction                   C
to prosecute subject to ratification by the Governing Body.

      On 3.4.2000 the Governing Body passed an order superseding the order
of the President dated 22.3.2000 and the respondent No. I was consequently
placed under suspension.
                                                                                              D
        On 17.4.2000 the respondent no. 1 filed a Criminal Writ Petition under
  Article 226 of the Constitution, 1950 (in short the 'Constitution') read With
  Section 482 of the Code of Criminal Procedure, 1973 (in short the 'Code')
  for quashing the order dated 3.4.2000 and seeking other reliefs also. ,The
  stand of respondent no. 1 was that opinion of Ministry of Law and Justice is
  binding on the Governing body of AIIMS. Once the President of AIIMS has                     E
  exercised the power it was not open to be re-considered by the Governing
  Body and there was non-application of mind on the part of the Goverrling
  Body while granting sanction. Since the tape recorded conversation or 'the
  transcript of the report of the ACB was not produced before the Go\' eming
  Body continuance of suspension and grant of sanction was bad. The D~lhi                     F
  Police had no jurisdiction to register a case against the writ petitioner as he
  was a Central Government employee and the ·sanction ought to have been
· routed through Central Bureau of Investigation (in short the 'CBI') as opmed
  by the CVC and the Ministry of Law and Justice.

        The present appellants filed reply by counter affidavit, taking the si.,nd            G
 that the sanction had been given after due consideration and there was sufficient       I

 evidence justifying the sanction. Since charge sheet had also been filed on
 28.4.2000 in the Court of the Special Judge Tis Hazari, Delhi and cognizance
 had been taken, the writ petitioner was not entitled to any reJief. It was also
 further pointed out that ACB has jurisdiction in view of the notificatibn
 issued by the Ministry of Horne Department, Govt. ofNCT. The High Court                      H
    166                        SUPREME COURT REPORTS [2004) SUPP. I S.C.R.

A    allowed the Writ Application primarily on the ground that the Governing
     Body cannot supersede the decision of the President of AIIMS and there was
    ·no material for granting sanction since records were not produced before the
     Governing Body for the purpose of assessing whether it was a fit case for
     granting sanction.

B         In support of the appeal, learned counsel for the appellant submitted
   that the High Court's approach is clearly erroneous. Section 19 of the
  ·Prevention of Corruption Act, 1988 (in short 'the Act') refers to the authorities
   competent to re'!love the concerned officers. The present case is covered by
   clause (c) of sub-section {I) of Section 19. By notification dated 25th February,
C I 999 issued under sub-section (I) of Section 29 of All India Institute of
   Medical Sciences Act, 1956 (in short the 'Act'), Regulations were brought
   into operation and the Regulations are called "All India Institute of Medical
   Sciences ·Regulations, 1999" (in short the 'Regulations'). In Schedule II,
   relating to the Appointing Disciplinary arid Appellate Authorities for various
   posts in the Institute, it has been clearly stipulated that for Group 'A' posts
D other than the "Director", the Appointing Authority is the Governing Body,
   a~d the Disciplinary Authority in respect of various penalties are the Governing
   Body except in respect of penalties (i) to (iv) for which President alone is th~
   concerned Authority. Above being the position, so far as the respondent No.
   I is .concerned, it is the Governing Body alone which had the authority to
E decide on the question of sanction. The High Court proceeded as if the
   decision was ~hat of the President and it was to be ratified by the Governing
   Body. There was no question of any ratification because the plenary powers
   vested with the Governing Body alone and the President has no role to play.
   With reference to the Central Civil Services Classification Control and Appeal
   Rules (in short the 'CCA Rules') relating to. penalties and disciplinary
F authorities, particularly Part V it was pointed out that the major penalty was
   to be imposed on respondent no. I. Therefore, it was the Governing Body
   alone which had the jurisdiction to ~ccord sanction. There was no questiop.
   of recording any reasons for departing from the President's view, as that is
   not a requirement in law. The concept of the ratification has been wrongly
G introduced by the High Court.
          In response. Mr. K. Ramamoorty, _learned senior counsel submitted that
    though the Governing Body had the jurisdiction to accord sanction, the view
    of the President sh~uld not have been brushed aside lightly and as noted by
    this Court in Mansukhlal Vithaldas Chauhan v. State of Gujarat, [I 997] 7
H   sec 622, the grant of sanction cannot be an empty formality, and an
        STATE(ANTI CORRUP. BRANCH) GOVT. OFN.C.T. OF DELHI v.R.C. ANAND[PASAYAT, J.)   167

application of mind was imperative.                                                          A
       We find from the judgment of the High Court that it proceeded on the
premises that the sanctioning authority is to apply its own independent mind,
and it was applied by the President and he sought for ratification by Governing
Bo~y. The approach is clearly erroneous. The sanctioning body was not the
President and it was the Governing Body. This position is fairly accepted by                 B
the learned counsel for the respondent No. I and cannot be disputed in the
teeth of specific provisions contained in Schedule II to the statutory
Regulations. But according to him since the President had expressed his
views, for taking different view, reasons should have been indicated. Such
pleas clearly are without any substance. When the Authority competent to                     C
accord sanction is the Governing body under the statutory Regulations and
that body, as in this case takes a decision there was no necessity for recording
reasons to differ from the view expressed by the President who had legally
no role to play. The allocation of powers distinctly made by the statutory
Regulations earmarking their own fields, subjects and topics cannot be
legitimately ignored, on any assumptions or baseless presumptions. As long                   D
as the President had no individual role to play in matters exclusively earmarked
and allocated to the Governing Body and the decision of the Governing Body
as that of any body has to be collective one, neither the President could
dictate what and how the Governing Body has to exercise its powers nor the
Governing Body is obligated in any manner to deal with and give reasons to                   E
differ from the view expressed by the President, which, as noticed above he
could not have in the light of t~e statutory Regulations themselves. There is
no justification in law or any principle of construction to import any such
restriction on the independent exercise of power by the earmarked Authority
on its own under the Regulations. The President cannot impede or foreclose
the liberty of the .Governing Body by expressing his view or by passing even                 F
a provisional order subject to ratification, wherein under· the statutory
Regulations, he had none, at all.

       Ratification is noun of the verb "ratify". It means the act of ratifying,
confirmation, and sanction. The expression "ratify" means to approve and
accept formally. It means to conform, by expressing consent, approval or                     G
formal sanction. "Approve" means to have or express a favourable opinion
of, to accept as satisfactory. In the instant case, there was no question of any
ratification involved as wrongly assumed by the High Court.

      The counter affidavit of the present appellant before the High Court                   H
    168                        SUPREME COURT REPORTS [2004) SUPP. 1 S.C.R.

A clearly indicated that relevant aspects were noted by the Governing Body
    before arriving at its decision. High Court seems to have proceeded on the
    basis that since the basic material, or evidence i.e. alleged tape conversation,
    was not looked into by the Governing Body to form its own independent
    opinion to depart from the view of President, the sanction was contrary to
    law. In Kalpnath Rai v. State, (through CBI), [1997] 8 SCC 732, it was
B   clearly observed by this Court that the sanctioning authority is not required
    to wait for the report of the experts. The sanctioning authority has only to see
    whether the facts disdosed in the complaint prima facie disclose commission
    of an offence or not. The actual production of the tapes etc., are matters for
    proof during trial and not necessarily to be undertaken at this stage. It is true
C   as contended by learned counsel for respondent no. I, grant of sanction is not
    empty formality.

          The validity of the sanction would, therefore, depend upon the material
    placed before the sanctioning authority and the fact that all the relevant facts,
    material and evidence including the transcript of the tape record have been
D   considered by the sanctioning authority. Consideration implies application of
    mind. The order of sanction must ex facie disclose that the san~tioning authority
    had considered the evidence and other material placed before it. This fact can
    also be established by extrinsic .evidence by placing the relevant files before
    the Court to show that all relevant facts were considered by the sanctioning
E   authority. [See Jaswant Singh v. State of Punjab, AIR (1958) SC 124 and
    State of Bihar v. P.P. Sharma, [19~2] supp. I SCC 222].

          The position was reiterated in Manusukh/a/'s case (supra). The order
    dated 3.4.2000 passed by the Governing Body cannot be said to be dP-ficient
    in any way in meeting the requirements of law. No other point was urged on
p   behalf of the respondent no. I to justify the High Court's order.

          In the aforesaid background the High Court's judgment is indefensible
    and is quashed. The matter pending before the Special Judge shall now proceed
    in accordance with law. We make it clear that we have not expressed any
    opinion on the merits of the case, which relates to the actual proof of the
G   charge before the competent Court during trial.

          The appeal is allowed to the extent mentioned above.

    S.K.S.                                                 Appeals partly allowed.