Holding

The CBI is not required to place investigation material before the sanctioning authority when it finds no prima facie case, and the Special Judge’s direction for further investigation was improper.

Summary

The Central Bureau of Investigation (CBI) registered a case under the Prevention of Corruption Act against Raj Kumar Jain, a junior engineer, but after investigation found no prima facie case and submitted a report under Section 173(2) of the CrPC seeking closure. The Special Judge refused to accept the report, directing the CBI to first obtain sanction from the appropriate authority, a view upheld by the Delhi High Court. On appeal, the Supreme Court held that Section 6(1) of the Prevention of Corruption Act requires sanction only when a prosecution is to be instituted; therefore, the CBI was under no duty to place its investigative material before the sanctioning authority when it concluded no case existed. The Court also observed that the Special Judge’s direction for further investigation was improper as no reasons were given and the report had not been examined. Considering the prolonged pendency, the Supreme Court accepted the CBI’s closure report, set aside the orders of the Special Judge and the High Court, and allowed the appeal.

Issues considered

Whether the CBI must obtain prior sanction from the sanctioning authority before filing a report under Section 173(2) CrPC for discharge when no prima facie case is found under the Prevention of Corruption Act.
Whether the Special Judge can direct further investigation without providing reasons and without examining the investigative report.
Interpretation of Section 6(1) of the Prevention of Corruption Act regarding the requirement of sanction for taking cognizance of offences by public servants.

Legislation cited

Code of Criminal Procedure, 1973s. 173(2)
Indian Penal Code, 1860s. 161, s. 164, s. 165
Prevention of Corruption Act, 1947s. 5(1)(e), s. 5(2), s. 6(1)

Subjects

Prevention of Corruption ActSection 6(1) sanctionCBI investigationSection 173(2) CrPCSpecial Judge powersDischarge of accusedPublic servant offence

Judgment

STATE THROUGH CBI A
-- v.
RAJ KUMAR JAIN

AUGUST 4, 1998

[M.K. MUKHERJEE AND D.P. WADHWA, JJ.] B

.. Prevention of Corruption Act, I 947 :

S. 6(1)-Government servant-Discharge of from prosecution-
Registration of case against by CBI u/s 5(1)(e) and 5(2)-CBI after c
investigation submitting report u/s. 173 Cr. P.C. for closure of case-Special
Judge declining to accept the report on the ground that CBI was required
to place the material collected during investigation before sanctioning
authority and it was for that authority to grant or refuse sanction-Held, CBI
was under no obligation to place material collected during investigation
D
before sanctioning authority when they found that no case was made out
against the employee-Code of Criminal Procedure, I973-:-S. 173 (2) .
...-
Code of Criminal Procedure, 1973 :

S. 173(2)---CBI submitting report to close the case registered u/s 5(1) E
(e) and 5(2) of Prevention of Corruption Act against a government servant-
Special Judge declining to accept the report and directing CBI to conduct
further investigation-Held, Special Judge has power to so direct if he finds
that opinion formed by Investigating Officer is not based on fall and complete
investigation-But, in the instant case Special Judge has not given any
F
reason, nor does it appear that he has gone through the police report-
Normally such matter is required to be remanded to Special Judge, but as
the matter is pending for more than JO years and the document show that
a thorough investigation has been made and the opinion expressed by CBI
that no prima fack case was made out against the respondent is just and
proper, the appeal is allowed. G

Abhinandan Jha. v. Dinesh Mishra, A.LR. (1968) SC 117, referred to.
J ~~ .
CRIMINAL APPELLATE JURISDICTION : Criminal Appeal No.
590 of 1992. H
957
958 SUPREME COURT REPORTS [I 998) 3 S.C.R.

A From the Judgment and Order dated 24.1.92 of the Delhi High Court in
Crl.R. No.171 ofl991.

K.N. Rawal, Additional Solicitor General and A.S. Nambiar, (A. K.
Srivastava) for P. Parmeswaran for the Appellant.

B R. Mohan and R. Ayyam Perumal for the Respondent.

The following Order of the Court was delivered :

On May, 11, 1988, the Central Bureau of Investigation (CBI), the appellant
before us, registered a case against the respondent, who was then a Junior
C Engineer in the New Delhi Municipal corporation, under Section 5(2) read with
Section 5(1) (e) of the Prevention of Corruption Act, 1947 (Act for short)
on the allegation that he was in possession of assets disproportionate to his
known sources of income. In the investigation that followed, C.B.I. found that
the allegations made against the respondent could not be substantiated and,
D accordingly, it submitted its report under Section 173(2) Cr.P.C. before the
Special Judge, Delhi praying for closure of the case.

The Special Judge declined to accept the report on the ground that after
the investigation was complete, the C.B.I. was required to place the materials
collected 'during investigation before the sanctioning authority and it was for
E that authority to grant or refuse sanction. According to the Special Judge, it
was only with the opinion of the sanctioning authority that the C.B.I. could
submit its report under Section 173(2) Cr. P.C. With the above observations
the Special Judge issued the following directions:

"It is directed that further investigation should be conducted and in
F the first instance, the prosecution/Investigating officer must approach
the concerned sanctioning authority before coming to the Court to
find out if the said authority would grant permission to prosecute the
accused or not."

Aggrieved by the above directions C.B.I. moved the High Court by
G filing a revision petition which was dismissed with a finding that the directions
issued by the Special Judge were proper and legal. Hence this appeal.

Section 6( I) of the Act, which is relevant f2f our present purpose, ,. ,
reads as under: -

H (I) "No Court shall take cognizance of an offence punishable under
STATE THROUGH CBI v. R.K. JAIN 959
Section 161 (or Section 164) or Section 165 of the Indian Penal Code A
or under sub-section (2) [or sub-section (3A)] of Section 5 of this Act,
alleged to have been committed by a public servant except with the
previous sanction, -

(a) in the case of a person who is employed in connection with the
affairs of the (Union) and is not removable from his office save by or B
with the sanction of the Central Government ;

(b) in the case of a person who is employed in connection with the
affairs of (a State) and is not removable from his office save by or with
the sanction of the State Government;
c
(c) in the case of any other person, of the authority competent to
remove him from his office.

From a plain reading of the above Section it is evidently clear that a
Court cannot take cognizance of the offences mentioned therein without
sanction of the appropriate authority. In enacting the above Section the D
legislature thought of providing a reasonable protection to public servants in
the discharge of their official functions so that they may perform their duties
and obligations undeterred by vexatious and unnecessary prosecutions.
Viewed in that context, the C.B.J. was under no obligation to place the
materials collected during investigation before the sanctioning authority, when E
they found that no case was made out against the respondent. To put it
differently, if the C.B.J. had found on investigation that a prima facie case was
made out against the respondent to place him on trial and accordingly prepared
a charge-sheet (challan) against him, then only the question of obtaining
sanction of the authority under Section 6( I) of the Act would have arisen for
without that the Court would not be competent to take cognizance of the F
chargesheet. It must, therefore, be said that both the special Judge and the
High court were patently wrong in observing that the C.B.I. was required to
obtain sanction from the prosecuting authority before approaching the Court
for accepting the report under Section 173(2) Cr. P.C. for discharge of the
respondent. G
As regards the direction for further investigation, it is, of course, true
that the Special Judge has power to so· direct if he finds, on consideration
of the police report, that the opinion formed by the Investigating officer
seeking discharge of the respondent is not based on full and complete
investigation, as observed by this Court in Abhinandan Jha v. Dinesh Mishra, H
1
960 SUPREME COURT REPORTS [1998] 3 S.C.R.

A A.LR. (1968) SC 117. Unfortunately, however, in issuing the above direction • ~
the Special Judge has not given any reason whatsoever which prompted him
to direct further investigation nor does it appear that he has gone through
the police report and .its accompaniments.

After recording the above finding the usual order which we are required
B to make is to remand the matter to the special Judge with a direction to look
into the report under Section 173(2) Cr. P.C. and the documents referred to
therein to deci4e whether further investigation should be ordered or not. But
1
considering tq e facts, that since the case was registered more than 10 years
have elap~<lAmd that such a direction would further delay the matter we have
C for ourselves looked into those documents and found that a thorough
investigation has been made and the opinion expressed by the C.B.I. that no
prima facie case was made out against the respondent is just and proper.

On the conclusions as above, we allow this appeal and set aside the
impugned orders of the Special Judge and that of the High Court.
D
R.P. Appeal allowed.