B.P. Das, J.@mdashThis application u/s 482 of the Code of Criminal Procedure, 1973 (''Cr. P.C in short) has been filed with a prayer to quash the First Information Report dated 28.6.1996 lodged by the Inspector of Vigilance, Cuttack, against the petitioner u/s 13(2) read with Section 13(1)(e) of the Prevention of Corruption Act, 1988 (''P.C. Act'' hereinafter) and registration of Cuttack Vigilance P.S. Case No.53 of 1996 by the Superintendent of Police, Vigilance, Cuttack. It may be stated here that during pendency of this application, charge-sheet against the petitioner has been filed on 15.5.2007.
2. The case of the petitioner, as narrated in the application, briefly stated, are thus: The petitioner was born in a business family at Rourkela and after death of his father-Hrushikesh Ray in 1978, he inherited the business of his father. Most of the business operations, which the petitioner inherited, were located at Rourkela and petitioner''s wife-Nilima Ray and mother-Kalayani Ray were all in the business having substantial individual earnings. The petitioner is the Karta of the HUF known as H.K. Ray and Sons, which has independent earnings. The petitioner is a shareholder of two other companies, namely, M/s. Raysons Holding (P) Ltd. and M/s. Kalyani Properties (P) Ltd. The petitioner is an income tax assessee since 1970 so also his mother and wife since pre-1960 and 1982 respectively. H.K. Ray and Sons is also an income tax assessee since 1975. Both the companies are also income tax assessee. All the aforesaid assessees have substantial earnings and have taken loan from various financial institutions or otherwise for creating assets and meeting their respective expenditures. The petitioner has further stated that he and his wife Nilima Ray have divorced during December, 2000 but during the relevant period, between 1990 and 1995 and even thereafter, i.e., on the date of lodgement of the FIR on 28.6.1996, and thereafter till December, 2000, they remained as husband and wife in the eyes of law.
The petitioner entered into public life In 1985 when he became the Chairman of the Rourkela Notified Area Council. In the same year, he was elected as a Member of the Legislative Assembly from Rourkela. In March, 1990, when the Janata Dal formed the Govt. in Orissa with the leadership of late Biju Pattnaik, the petitioner was inducted into the State Cabinet as Minister of Industry and continued as such till March, 1995. According to the petitioner, on the background of rampant corruption by persons holding high political and pubic offices in the State and in order to curb such corruption as promised by late Biju Patnaik during the elections to the Lok Sabha in 1989 and to the State Assembly in 1960, on 8.10.1990 the then Chief Minister late Biju Patnaik introduced the Orissa Special Courts Bill in the State Assembly and the same having been passed on 12.10.1990 was sent to the Central Govt. for according assent of the President. The Govt. of India suggested certain amendments and the Bill was accordingly amended by Amendment Bill in 1992. The Bills received the assent of the President on 19.7.1992 and 22.7.1992 and came to be published on 27.7.1992 as an Act being Orissa Special Courts Act, 1990. Under the aforesaid Orissa Special Courts Act, 1990, prosecution was initiated against various persons holding high public offices including eight former Ministers belonging to Congress Party, who were in office between 1980-90. While the matter stood thus and the aforesaid former Ministers were facing trial, elections to the State Assembly were held in 1995. The Congress Party on assuming power in Orissa repealed the Orissa Special Courts Act, 1990, filed FIRs and initiated investigations against several former Ministers, who held offices in Janata Dal Govt. during the period from March, 1990 to March, 1995, under the P.C. Act but no FIR was lodged by the opposite parties during the said period against the petitioner even though most of the assets, which are the subject matter of the present FIR, were in possession of the petitioner and/or has family members and/or the companies owned by the family during the said period. Thereafter in April, 1996 the petitioner was elected as a member of Rajya Sabha and on 28.6.1996 was inducted into the Union Cabinet headed by Shri H.D. Devegowda, the then Prime Minister of India.
The petitioner alleged that soon before his induction into the Union Cabinet, the Congress Party, which was then in power in the State, maliciously levelled false and vexatious charges of corruption against him solely for damaging his character, injuring his reputation and exposing him to social ridicule and with a view to spite him on account of political rancor and political prejudices. On 26.6.1996 search warrants were obtained from the Court of the Chief Judicial Magistrate, Cuttack, in Vigilance Criminal Misc. Case No.28 of 1996 and on 27.6.1996 searches were carried out at different establishments owned by the petitioner including the hotel properties owned by the companies in which the petitioner had business interests and even before the outcome of the aforesaid searches were known, complaint was lodged on 28.6.1996, vide Annexure-1, by the Inspector of Vigilance Cell, Cuttack, which was treated as an FIR u/s 13(2) read with Section 13(1)(e) of the P.C. Act and in a hot haste Cuttack Vigilance Case No.53 of 1996 was registered against the petitioner. The petitioner alleged that the aforesaid prosecution, which was launched hastily against him mala fide was aimed at achieving the only objective of preventing him from being inducted into the Union Cabinet.
According to the petitioner, if the allegations made in the FIR are taken at their face value and accepted in their entirety, they do not prima facie constitute any offence under the P.C. Act or make out a case against him.
The foundation of the allegation of the allegation made in the FIR that between March, 1990 and March, 1995 the petitioner acquired assets to the tune of Rs. 5,47,52,000.00 and the same is disproportionate to his known source of income is based on the following premise:
Probable Income during the period Rs. 89,80,000.00 Less-Probable Expenditure during the Period Rs. 15,32,000.00 Probable Savings during the Period Rs. 74,48,000.00 Probable value of assets Rs. 6,2.1,00,000.00 Probable Savings Rs. 74,48,000.00 Value of disproportionate assets Rs. 5,47,52,000.00
The petitioner alleged that figures as mentioned against his income, expenditure, savings and assets are incorrect, concocted, based on no materials and are purely imaginary.
In the FIR it has been alleged that by 31.3.1995 the petitioner had acquired the following assets:
1. Land and Building near Daily
Market, Rourkela Rs. 5,00,000.00
2. Building at Bhubaneswar Rs. 15,00.000.00
3. Flat at Calcutta Rs. 8,50,000.00
4. Hotel Mayfair, Rourkela Rs. 70,00,000.00
5. Pahadi Hotel, Vedavyas Rs. 3,00,000.00
6. Mayfair Beach Resort, Puri Rs.3,39,00,000.00
7. Mayfair Garden Lodging,
Bhubaneswar Rs.2,63,00.000.00
8. Bharat Weigh Bridge, Panposh
Road, Rourkela Rs. 50,000.00
9. Cash Rs. 4,00,000.00
10. 100 tolas gold Rs. 4,50,000.00
11. N.S.C. & other deposits Rs. 1,50,000.00
12. Other assets Rs. 3,00,000.00
13. Lands purchased Rs. 5,00,000.00
Rs. 6,22,00,000.00
The petitioner has stated that the asset indicated at sl. No.7, i.e., May fair Garden Lodging, Bhubaneswar, probably referring to Hotel Garden Inn, does not belong to the petitioner or his family members. The other assets either belong to the petitioner, his mother, wife and children or the companies, which are partly or wholly owned by the petitioner and/or his family members. In the application the petitioner has given the ownership of each of the thirteen Nos. of assets, which are extracted hereunder:
SI.No. Description of the Assets Ownership as per IT/WT records
1. Land and Building near Daily Dilip Ray/Kalyani Ray/
Market, Rourkela H.K.Ray & Sons HUF
2. Building at Bhubaneswar H.K. Ray & Sons HUF
3. Flat at Calcutta Nilima Ray
4. Hotel Mayfair; Rourkela Kalyani Properties (P) Ltd.
5. Pahadi Hotel, Vedavyas Nilima Ray
6. Mayfair Beach Resort, Puri Raysons Holding (P) Ltd.
7. Mayfair Garden Lodging,
Bhubaneswar Does not belong to the group.
8. Bharat Weigh Bridge,
Panposh Road, Rourkela Dilip Ray
9. Cash All family members and group
business establishment.
10. 100 tolas gold. All family members.
11. N.S.C. and other deposits. All family members.
12. Other assets All family members.
13. Lands purchased Family members and group
companies.
Basing upon the aforesaid, it is submitted that even if the FIR is accepted at its face value, the following scenario would emerge with regard to the assets:
As the Mayfair Garden Lodging, Bhubaneswar valued at Rs. 1,63,00,000.00 does not belong to the petitioner or his family members nor does the petitioner or his family members have any investment therein, the entire amount of Rs. 1,63,00,000.00 is liable to be deducted from the value of the assets as indicated in the FIR. Similarly, the value of Mayfair (Beach Resort), Puri, which has been indicated in the FIR to be Rs. 3,39,00,000.00, had been disclosed before the Income Tax authorities in November, 1995, i.e., prior to filing of the FIR on 28.6.1996, and the said hotel had since been valued by the Income Tax Department at Rs. 1,76,23,858.00 and assessed to tax by the said Department on the basis of the said valuation. The petitioner, therefore, submitted that Rs. 3,39,00,000.00 minus Rs. 1,76,23,858.00 = Rs. 1,62,76,415.00 is liable to be reduced from the total value of the assets as indicated in the FIR.
The petitioner submitted that after becoming Minister, he filed the property statement indicating the value of the assets at Rs. 65,50,000.00 and the same is also liable to be deducted from the total value of the assets.
According to the petitioner, the recast value of the assets would be thus:
The value of assets in FIR Rs. 6,22,00,000.00
Less: Mayfair Garden Lodging,
Bhubaneswar Rs. 1,63,00,000.00
Differential amount in
Valuation of Hotel Mayfair
Beach Resort, Puri Rs. 1,62,76,415.00
Assets held prior to March
1990 and Declared
by the Petitioner Rs. 65,50.000.00
Rs. 3.91.26.415.00
Balance: Rs. 2,30,73,585.00
The income of the petitioner and his family members and the two companies, namely, M/s. Raysons Holding (P) Ltd. owner of hotel Mayfair Beach Resort, Puri and M/s. Kalyani Properties (P) Ltd., owner of hotel Mayfair, Rourkela, as indicated in the application, is extracted hereunder:
Name Income Pre 90 Income by Loans Total
during 1990- available sale of received and
95 as per IT balance assets liabilities
Return withdrawn created
from
business
during 1990-
95
Dilip Ray 14,83,965.00 3,56,526.00 1,64,000.00 1,30,554.00 21,35,045.00
NilimaRay 29,98,186.00 93,250.00 - 23,65,027.00 54,56,463.00
KalyaniRay 17,18,003.00 5,31,078.00 - 17,84,965.00 40,34,046.00
H.K.Ray 5,16,486.00 58,950.00 51,300.00 12,33,399.00 18,60,135.00
& Sons (HUF)
Raysons 15,026,424.00 - - 94,05,345.00 24,431,769.00
Holdings (P) Ltd
Kalyani 33,01,465.00 2,25,626.00 - 80,60,458.00 95,87,549.00
Properties (P) Ltd.
25,044,529.00 12,65,430.00 2,15,300.00 20,979,748.00 47,508,007.00
The statement of income indicated in the above paragraph earned during the period from 1.4.1990 to 31.3.1995 was prepared on the basis of the audited accounts and the Income and Wealth Tax Statement filed during the said period including other relevant documents available with the petitioner and his family members and the two companies have been enclosed as Annexures 5, 6, 7, 8, 9 and 10. The petitioner submitted that even accepting the contents of the FIR at its face value, while the available income including loans taken and liabilities payable by the petitioner, his family members and the companies owned by them as declared in the Income Tax Returns, is to the tune of Rs,4,75,003.00 and the assets of the petitioner, his family members and the companies owned by them, as alleged in the FIR, is to the tune of Rs. 2,30,73,585.00, the allegation that the petitioner has acquired assets disproportionate to his known source of income is vitiated.
According to the petitioner, on 22.9.1999 a detailed representation was filed by Nilima Ray before the Superintendent of Police, Vigilance Cell, Cuttack, enclosing the statement of income, expenditure and assets of the petitioner, his family members and the various companies, which they owned during the period from 1.4.1990 to 31.3.1995 including income tax returns, wealth tax returns, filed prior to 28.6.1996, and other documents with a request to take the same into account for a fair and proper investigation, but the same was not considered till filing of this application. Further, this has been done with a mala fide intention to keep the proceeding hanging so as to blackmail the petitioner at the time of election in which he will participate or during the time when he is likely to become a Minister.
3. Learned Counsel for the petitioner on the aforesaid facts and premises submitted that the manner in which the disproportionate assets have been worked out in the FIR and the charge-sheet filed during pendency of this application, is not proper and no reasonable person can take the assets of the petitioner and his family members and various entities including the companies owning the hotels and clubbing them to the assets of the petitioner on one hand but not taking the income of the said entities into consideration even though it is evident from the income tax and wealth tax returns available with the O.Ps. on the other.
Shri Shanti Bhusan, learned Senior Counsel for the petitioner, strenuously submitted that the proceedings initiated against the petitioner are manifestly attended with mala fides and has been maliciously instituted against the petitioner.
The petitioner has, therefore, prayed that the entire proceedings should be quashed because the uncontroverted allegations do not establish the offences alleged against him and further there is bleak chance of his conviction in the proceedings and, therefore, no useful purpose is likely to be served by allowing the criminal prosecution to continue. Shri Shanti Bhusan forcefully submitted that since the allegations contained in the FIR taken at their face value and accepted in their entirety do not constitute an offence, the FIR as well as the charge-sheet should be quashed. Further it was argued that right to speedy trial is a fundamental right enshrined in Article 21 of the Constitution of India and a speedy investigation is a part of right to speedy trial. Since the investigation has not been completed within a reasonable time, it can be taken as the basis for quashing the proceedings. In support of his contention, the learned Counsel referred to a decision of the Supreme Court in
It was further argued that originally the disproportionate assets were alleged to be to the extent of Rs. 5.47 crores and the same were reduced to Rs. 4.10 crores and this, according to the petitioner, was done when the prosecution realized that the property at serial No.7 of the FIR (Annexure-1), namely, Mayfair Gardens Lodging at Bhubaneswar, had nothing to do with either the petitioner or any of his family members or companies. The learned Counsel argued that the methodology for calculating the disproportionate assets adopted by the opposite parties was totally absurd as in doing so only the assets were taken into account and not the income. They had also not taken into account the income of particularly two companies, namely, M/s. Raysons Holdings (P) Ltd. and M/s. Kalyani Properties (P) Ltd., as well as the Special Bearer Bonds though the same were encashed during the check period in the year 1992 to the extent Rs. 17.52 lakhs. Therefore, a total amount of Rs. 2 crores approximately of the income was ignored by the opposite parties. Similarly the income in the hands of the companies by way of loans received or money received towards equities to the extent of Rs. 1.54 crores was again not taken into account. Therefore, Rs. 3.54 crores were prima facie not taken into account while calculating the alleged disproportionate assets. In addition, learned Counsel for the petitioner during the course of hearing drew our attention to serial No. 19 of the charge-sheet filed to show that an amount of Rs. 40 lakhs towards a hotel complex at Darjeeling and standing in the name of M/s. Mahakal Properties Pvt. Ltd. allegedly constructed during the check period was taken towards the assets side while calculating the petitioner''s alleged assets though in the admission of the opposite parties, as evident from the memorandum dated September, 20, 1996 of the Inspector of Police, Vigilance, the construction of the hotel was started in or about June, 1995 well after the check period ended in March, 1995. So, this property, according to the petitioner, could not have been considered to be the assets created within the check period and the amount of Rs. 40 lakhs approximately had also to be excluded from the assets. Calculating all these, according to the learned Counsel for the petitioner, Rs. 3.94 crores had to be excluded from the alleged disproportionate assets, which has been shown to be to the extent of Rs. 4.10 crores.
Likewise, the petitioner indicated that so far as the household articles alleged to have been found during the search to the extent of Rs. 64 lakhs approximately are concerned, out of the sum of Rs. 58.66 lakhs relating to the check period of 1990-95, the articles valued at Rs. 49.68 lakhs belonging to the hotels, whose value had already been taken into consideration on the asset side, were again considered thereby duplicating consideration of the values of the hotel articles to the extent of Rs. 49.68 lakhs and adding this sum of Rs. 49.68 lakhs to the earlier sum of Rs. 3.94 crore, it would be seen that an amount of Rs. 4.43 crores have to be taken away and the so called disproportionate assets allegedly to the extent of Rs. 4.10 crores wound immediately disappear.
The petitioner further argued that so far as Rourkela Hotel is concerned, which is a 1982 property, a sum of Rs. 83,33,389/- has been taken as the amount allegedly expended in construction during the check period. According to the petitioner, four items of construction totalling to Rs. 34,71,472/- relating to construction for the year 1995-96, i.e., 1.4.1995 to 31.3.1996, which is beyond the check period, have also been added. If this sum of Rs. 34.71 lakhs would be added to the amount of Rs. 4.43 crores, it would be seen that about Rs. 4.78 crores have to be taken out of the paie of consideration and, therefore, the so-called disproportionate assets allegedly to the extent of Rs. 4.10 crores would completely disappear.
It was further argued that on 22.9.1999 Smt. Nilima Ray, ex-wife of the petitioner, filed a detailed representation before the S.P., Vigilance Cell, enclosing the statement of income, expenditure and various companies, which they owned during the period between 1.4.1990 and 31.3.1995 including the income tax returns, wealth tax returns and other documents constituting a total of 517 sheets containing pubic record of documents relating to the properties / income / expenditure/assets filed before the competent statutory authorities as per the requirement of law but the said representation was not considered fairly by the opposite parties. Learned Counsel for the petitioner submitted that the investigating agency with the full knowledge that the income of the petitioner, his family members and other entities including the companies owned hotels had income, which far exceeded the alleged disproportionate assets, have deliberately excluded the income of those entities while calculating the so-called disproportionate assets of the petitioner. This, according to the petitioner, could only be attributed to the patent mala fide attempts to somehow make out a false case against the petitioner, r urther, Smt. Nilima Ray had satisfactorily accounted for the assets held by the petitioner for which the petitioner could not be charged with or tried for an offence u/s 13(1)(e) of the P.C. Act. As the charge-sheet was filed during pendency of this application and as the application was filed for quashing the FIR, learned Counsel for the petitioner submitted that mere filinc, of charge-sheet could not render the present proceeding infructuous because an attempt has been made by the investigating agency to file the charge-sheet just one day before the application was listed before this Court for hearing on 16.5.2007, and after almost 11 years of registration of the FIR on 18.6.1996 in clear breach of the interim orders passed by this Court,. In this regard learned Counsel for the petitioner relying upon the decision of a Division Bench of the Allahabad High Court in the case of
4. Opposing the application, Shri S.K. Mund, learned Counsel for the opposite parties, as well as Shri D. K. Mohapatra, learned Standing Counsel for the Vigilance Department, submitted that the FIR taken in its entirety prima facie would constitute the ingredients of the cognizable offence u/s 13(1)(e) of the P.C. Act. The allegation, after a thorough investigation, was well founded and as a consequence has culminated in the charge-sheet. Relying upon the decision in the case of
A written note of submissions was also filed by the learned Counsel for the Vigilance Department and it was submitted that since charge-sheet in the case has already been filed before the competent Court, it is for that Court to decide whether it would take cognizance or not, but this Court should not usurp the power and jurisdiction of the original Court in this regard. Learned Counsel for the opposite parties referred to the case of State of Punjab v. Dharam Singh 1987 SCC (Cri) 621, wherein it was held that the inherent powers are to be exercised only in very rare and exceptional circumstances. This Court is aware of the position of law on the point, but the main attack of the petitioner to the FIR and the charge-sheet is that the representation of Nilima Ray had not been taken into consideration and that had it been taken into consideration, there would not have been any material for filing the charge-sheet. This point has not been answered by the opposite parties neither during the course of argument nor is their anything in the note of submissions filed by the opposite parties. In the case of
Mere possession of any pecuniary resources or property is by itself not an offence, but it is the failure to satisfactorily account for such possession of pecuniary resources or property that makes the possession objectionable and constitutes the offence within the ambit of Section 5(1)(e) of the Act.
Therefore, a police officer with whom an investigation of an offence u/s 5(1)(e) of the Act is entrusted should not proceed with a preconceived idea of guilt of that person indicated with such offence and subject him to any harassment and victimization, because in case the allegations of illegal accumulation of wealth are found during the course of investigation as baseless, the harm done not only to that person but also to the office he held will be incalculable and inestimable.
In paragraph 102 of the aforesaid decision, the apex Court by way of illustration indicated certain categories of cases wherein the extraordinary power under Article 226 of the Constitution or the inherent powers u/s 482 of the Cr.P.C. could be exercised either to prevent abuse of the process of any Court or otherwise to secure the ends of justice, which are extracted hereinbelow:
(1) Where the allegations made in the first information report or the complaint, even if they are taken at their face value and accepted in their entirety do not prima facie constitute any offence or make out a case against the accused.
(2) Where the allegations in the first information report and other materials, if any, accompanying the FIR do not disclose a cognizable offence, justifying an investigation by police officers u/s 156(1) of the Code except under an order of a Magistrate within the purview of Section 155(2) of the Code.
(3) Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same do not disclose the commission of any offence and make out a case against the accused.
(4) Where the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated u/s 155(2) of the Code.
(5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused.
(6) Where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the concerned Act, providing efficacious redress for the grievance of the aggrieved party.
(7) Where a criminal proceeding is manifestly attended with mala fldeand/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge.
5. Learned Counsel for Vigilance Department has filed a paper book containing copies of the FIR, charge-sheet and connected documents. Perusal of the copy of the charge-sheet reveals that the documents indicated at serial Nos.29 and 30, i.e., the wealth tax return and income tax return of the petitioner and those of Nilima Ray, in the list of properties/ articles/documents recovered/seized during investigation and relied upon, being voluminous had not been placed with the charge-sheet. On the same ground, the documents indicated at serial Nos.31, 32, 33, 34, 49(a) and (b) had also not been laced with the charge-sheet.
Learned Counsel for the petitioner further submitted that during investigation the petitioner produced certain relevant documents, particularly the documents indicated in the preceding paragraphs, but the prosecution ignored the same and had the said documents been taken into consideration, the petitioner would not have been charge-sheeted.
6. I find, their is some force in the aforesaid contention of the learned Counsel for the petitioner. But a perusal of the charge-sheet, which was filed during pendency of this proceeding, would show that the same has been filed against the petitioner u/s 13(2) read with Section 13(1)(e) of the P.C. awaiting sanction of the Governor of Orissa. Hence the grievance of the petitioner can be looked into by the investigating agency in accordance with law if it so decides. In the alternative, in the event sanction is accorded, the petitioner can file an application before the trial Court at the time of framing of charge raising all those points as highlighted in this application and indicated in the preceding paragraphs as well as regarding the representation made by Nilima Ray to the Superintendent of Police, Vigilance Cell, Cuttack, on 22.9.1999.
7. In view of the aforesaid discussion, I am not inclined to interfere in this proceeding u/s 482, Cr. P.C. and quash the F.I.R. in Annexure-1, as prayed for.
8. With the observations made above, the Criminal Misc. Case is disposed of.
