Y. BALAJI v. KARTHIK DESARI & ANR. ETC

Citation: [2023] 8 S.C.R. 1026

Court: Supreme Court of India

Bench: KRISHNA MURARI AND V. RAMASUBRAMANIAN, JJ.

Judgment text

SUPREME COURT OF INDIA Y. BALAJI v. KARTHIK DESARI & ANR. ETC. Criminal Appeal Nos. 1671-1673 of 2023 Y. BALAJI v. KARTHIK DESARI & ANR. ETC. (Criminal Appeal Nos. 1671-1673 of 2023) MAY 16, 2023 [KRISHNA MURARI AND V. RAMASUBRAMANIAN, JJ. ] Prevention of Money Laundering Act, 2002 - ss. 3, 2(1)(u) - Offence of Money Laundering - Prevention of Corruption Act, 1988 - Jobs-for-cash scam in the State of Tamil Nadu - Whether without identifying the proceeds of crime/a property representing the proceeds of crime and any process or activity connected to proceeds of crime as required by s. 3, which constitute the foundational/ jurisdictional fact, can ED initiate an investigation and issue summons - Held: All the three FIRs alleged that the accused had committed offences included in the schedule by taking illegal gratification for providing appointment to several persons in the Public Transport Corporation - It is the bribe money that constitutes the proceeds of crime u/s.

2(1)(u) - A public servant receiving illegal gratification is in possession of proceeds of crime - Mere generation of proceeds of crime is sufficient to constitute the offence of moneylaundering - In s. 3 there are 6 activities or process and one of them is "acquisition" - If a person takes a bribe, he acquires proceeds of crime, hence, activity of "acquisition" takes place - Even if he does not retain it but "uses" it, he will be guilty of offence of money- laundering, since "use" is one of the activities mentioned in s. 3 - The FIRs for the predicate offences identify all the three components of s.

3, persons; process; and product - Corruption money represents the proceeds of crime - In the case of an offence of corruption, the criminal activity and the generation of the proceeds of crime are like Siamese twins - The contention that the investigation by ED was triggered without any foundational/jurisdictional facts are aimed at hoodwinking the Court - Wherever there are allegations of corruption, there is acquisition of proceeds of crime which itself tantamount to money-laundering - Once an information relating to the acquisition of huge amount of illegal gratification in the matter of public employment has come in the public domain, it is the duty of the ED to register an Information Report - This is because 1026 Y. BALAJI v. KARTHIK DESARI & ANR. ETC.

"acquisition" is an activity amounting to money-laundering and the illegal gratification acquired by a public servant represents "proceeds of crime", generated through a criminal activity in respect of a scheduled offence - Receipt of bribe money is an act of moneylaundering - All the arguments on facts and all the legal contentions emanating from some portions of the judgment in Vijay Madanlal Choudhary, to challenge the validity of the proceedings initiated by ED are completely unsustainable. Criminal Law - Matters pertaining to Jobs-for-cash scam in the State of Tamil Nadu - Impugned order allowed de novo investigation on a ground not raised in the petition - Held: 'D', whose original complaint led to the registration of FIR in Crime No.

441 of 2015 seems to have had a genuine grievance against the culprits at the bottom of the layer, but he later turned out to be a Trojan horse, willing to sabotage the investigation against influential persons - Order directing de novo investigation in all the three cases, actually inured to the benefit of the accused, but the High Court put it on the ground that the credibility of the investigation should not be eroded - In fact, the accused did not seek de novo investigation on the ground of slackness on the part of the Investigating Officer, but it was 'D' who sought it, with the able assistance of the Investigating Officer - What is shocking is that the High Court directed reinvestigation to be started ab initio, wiping out the earlier investigation altogether - By issuing the said direction, the High Court not only directed the wiping out of the investigation carried out so far, but virtually wiped out even the judgment of Supreme Court dtd. 08. 09.

2022 passed in the previous round of litigation - The problem with the impugned order is not merely one of improper usage of language, as sought to be diluted by the accused and the complainant, but something more - Prevention of Money Laundering Act, 2002 -Prevention of Corruption Act, 1988.

Doctrines/Principles - Doctrine of stare decisis - Whether in the light of the fact that notice has been ordered in the review petition and a few interim orders have been passed in some proceedings, it is necessary for this Court to tag these appeals along with a review petition or defer the hearing of these matters until a decision is rendered in the review petition and other petitions - Held: A notice ordered in the review petition will not destroy or diminish the precedential value of Vijay Madanlal Choudhary - The argument of the counsel for the accused, if accepted, will not only destroy the principles of judicial discipline and the doctrine of stare decisis, but also bring to a grinding halt, all pending investigation in the country - Accused is not entitled at all either to seek a reference to a larger Bench or to seek to defer the matter till a decision is rendered in the matters involving larger issues - Appeals arising out of the order of the Division Bench of the High Court are allowed - Order of the Division Bench of the High Court dtd.

01. 09. 2022 is set aside - ED entitled to proceed further from the stage at which their hands were tied by the impugned order - Prevention of Money Laundering Act, 2002 -Prevention of Corruption Act, 1988 - Criminal Law. Prevention of Money Laundering Act, 2002 - History of - Discussed. Criminal Rules of Practice, 2019 - rr. 231(3), 237 - Appellant contended that the High Court overlooked the provisions of r. 231(3) and also s. 65B, Evidence Act - Held: Both the contentions are without substance - r. 231 primarily deals with the grant of certified copies of certain other documents to the accused, before filing of the Final Report - It states that certified copies of unmarked documents shall not be given - High Court has not passed any order directing the grant of certified copies of unmarked documents - It has only permitted the ED to have an inspection of the documents u/r. 237 and thereafter to file a proper copy application - This is not contrary to r.

231(3) - Further, it is not known how an argument revolving around s. 65B, Evidence Act is raised - s. 65B concerns the admissibility of electronic records - Without certification, ED may not be able to use those electronic records in evidence, in the prosecution under PMLA - But it does not mean that they cannot even have a look at the electronic record - Evidence Act, 1872 - s. 65B - Prevention of Money Laundering Act, 2002 -Prevention of Corruption Act, 1988 - Criminal Law. Criminal Law - Matters pertaining to Jobs-for-cash scam in the State of Tamil Nadu - Objection to the maintainability of the appeals by appellants, against the order of de novo investigation - Held: Criminal jurisprudence recognizes a limited role of victims and it is the state which is entrusted with the onerous responsibility of prosecuting the accused and getting them punished - These Y. BALAJI v. KARTHIK DESARI & ANR. ETC.

theories of law were developed when process of administration of criminal justice system was largely unpolluted - However, where some of the complainants and the accused have come together to form an unholy alliance, victims cannot be left at the mercy of such partnerships - What was compromised between the complainant and accused is not just their disputes, but justice, fair play, good conscience and the fundamental principles of criminal jurisprudence - Investigation trail of a criminal case cannot be converted by the complainant and accused into a friendly match - Further, submissions made on the question of locus in the previous round of litigation in were rejected by Supreme Court in the very same proceedings in the first round - Therefore, the accused cannot raise the question of locus again and again. Criminal Rules of Practice, 2019 - rr. 207(12), 210 - Some of the appellants filed copies of the confession statements u/s.

164, CrPC, as part of the paper book in the appeals - It was contended that the confession statements recorded before the Magistrate are sacrosanct and that the copies of the same cannot be made available to third parties - Held: It is clear from r. 207(12) that a confession statement is a confidential document till the time investigation is complete and Final Report filed - r. 210 enables "third parties to apply to the Court for the grant of copies of Judgment or order or any proceeding or document in the custody of a Court" - Therefore, it is not as though the appellants have filed something to which they could have never had any access - Further, many of the documents had started appearing in the public domain at the instance of several persons - Hence, it is futile to contend that the appeals are liable to be thrown out on the ground that the appellants came up with documents to which they could not have had any access - Code of Criminal Procedure, 1973 - s. 164.

Criminal Law - Matters pertaining to Jobs-for-cash scam in the State of Tamil Nadu - Political vendetta alleged - On the basis of the timeline of events, it was alleged the Minister was implicated in the case on 08. 03. 2021, for offences under the PC Act immediately after the announcement of the elections to the Legislative Assembly, as he had switched over from the party in power to another - Held: That the Investigation Officer did not choose to include the offences under the PC Act from the year 2015 till 08. 03. 2021, cannot be taken to the credit of the Minister, but should be taken as a discredit of the prosecution - If the shield of office protected him from 2015 till he formed part of the splinter group and the shield stood temporarily removed for a brief period of time until he again became a Minister in the next regime, the same cannot be said to be a case of political vendetta - Prevention of Corruption Act, 1988.

Practice and Procedure - For all the accused in the PMLA case, arguments were advanced for the grant of larger reliefs than what they got under the impugned order, without even filing any appeal against the same - Held: It is possible in law for a successful party (though in civil proceedings) to support the decree without supporting the judgment - But what the accused sought to do before Supreme Court was to support the judgment and seek an enlargement of the decree, without independently filing appeals - Since they took a chance by adopting such a course, they may not even be able to challenge the impugned order hereafter, once the seal of approval on the same is affixed by this Court and the doctrine of merger comes into play - Prevention of Money Laundering Act, 2002 - Doctrines/Principles - Doctrine of merger. Disposing of the appeals, the Court HELD: 1.

The order directing de novo investigation in all the three cases, has actually inured to the benefit of the accused, but the High Court put it on the ground that the credibility of the investigation should not be eroded. In fact, the accused did not seek de novo investigation on the ground of slackness on the part of the Investigating Officer, but it was 'D' who sought it, with the able assistance of the Investigating Officer. The fact that 'D's petition was intended to help the accused is also borne out by one more fact. His original complaint dated 29. 10. 2015 which led to the registration of FIR in Crime No. 441 of 2015 was against ten persons and the offences registered therein were only under Sections 406 and 420 read with Section 34 IPC. On this complaint, a Final Report was filed under Section 173(2) of the Code on 13. 06. 2017 and this resulted in the registration of Calendar Case in CC No. 3627 of 2017.

'D' was happy with the fact that the Report filed under Section 173(2) did not include the offences under the PC Act. 'D' was not bothered at that time about the fact that the register for entering the interview marks, sent to the Forensic Y. BALAJI v. KARTHIK DESARI & ANR. ETC. Department had not been received. Suddenly, he became worked up after the filing of the Report under Section 173(8) leading to the registration of Calendar Case No. 24 of 2021 including the offences under the PC Act. What is shocking is that the High Court directed reinvestigation to be started ab initio, wiping out the earlier investigation altogether. One saving grace in this case is that even the learned senior counsel appearing for 'D' and the learned senior counsel appearing for the accused could not support the operative portion of the impugned order dated 31. 10. 2022, in Criminal O. P. No. 15122 of 2021.

By issuing the aforesaid direction, the High Court not only directed the wiping out of the investigation carried out so far, but virtually wiped out even the judgment of this Court dated 08. 09. 2022 passed in Criminal Appeal Nos. 1514-1516 of 2022. This Court has said in paragraph 45 of the decision dated 08. 09. 2022 in Criminal Appeal Nos. 1514-1516 of 2022 "We are constrained to say that even a novice in Criminal Law would not have left the offences under the PC Act, out of the final report. " Ignoring the said opinion of this Court, the High Court has directed the Investigating Officer to find out afresh whether the offences under the PC Act are made out or not. Therefore, the problem with the impugned order is not merely one of improper usage of language, as sought to be diluted by the learned senior counsel for the accused and the complainant, but something more. [Paras 19-22, 25][1054-B-G; 1055-D; 1056-C-D] 2.

It is true that criminal jurisprudence recognizes a limited role for victims and it is the State which is entrusted with the onerous responsibility of prosecuting the accused and getting them punished. But we must remember that certain theories of law were developed at a time when the process of administration of the criminal justice system was in the hands of honest and responsible Police officials and the stream remained largely unpolluted. Today the situation is different. In cases of this nature, where some of the complainants and the accused have come together to form an unholy alliance, the victims of crime cannot be left at the mercy of such partnerships. We have seen in this case, persons aspiring to secure public employment, paying illegal gratification, through persons who are public servants, to persons in power and later coming to the Court supporting the accused on the basis of an out of Court settlement.

What was compromised between the complainant and accused is not just their disputes, but justice, fair-play, good conscience and the fundamental principles of criminal jurisprudence. In fact, the case on hand is one where there are two teams just for the purpose of record, but no one knows who is playing for which team and where the match was fixed. As a matter of fact, very vocal submissions were made on the question of locus in the previous round of litigation in P. Dharamaraj vs. Shanmugam in Criminal Appeal Nos. 1514- 1516 of 2022. But the objections relating to maintainability were rejected by this Court in the very same proceedings in the first round. Therefore, the accused cannot raise the question of locus again and again. [Paras 33, 34][1060-D-H; 1061-A] 3. It is clear from Rule 207(12) that a confession statement is a confidential document till the time investigation is complete and Final Report filed. The relevant portion of Rule 207(12) states "...

not to make its contents public until the investigation is completed and final report filed". Rule 210 extracted above enables "third parties to apply to the Court for the grant of copies of Judgment or order or any proceeding or document in the custody of a Court". Therefore, it is not as though the appellants have filed something to which they could have never had any access. Many of the documents have started appearing in the public domain at the instance of several persons. Hence, it is futile to contend that the appeals are liable to be thrown out on the ground that the appellants have come up with documents to which they could not have had any access. [Paras 39-41][1062-D- E, G-H;] 4. That the Investigation Officer did not choose to include the offences under the PC Act from the year 2015 till 08. 03. 2021, cannot be taken to the credit of the Minister, but should be taken as a discredit of the prosecution.

If the shield of office protected him from 2015 till he formed part of the splinter group and the shield stood temporarily removed for a brief period of time until he again became a Minister in the next regime, the same cannot be said to be a case of political vendetta. [Para 44][1064-D-F] Y. BALAJI v. KARTHIK DESARI & ANR. ETC. Janata Dal vs. H. S. Chowdhary (1992) 4 SCC 305 : [1992] 1 Suppl. SCR 226;Simranjit Singh Mann vs. Union of India (1992) 4 SCC 653 - held inapplicable. 5. What is worrisome is the fact that V. Ganesh Kumar is an employee of the Transport Corporation. In the charge-sheet filed on his complaint, which has been taken on file as CC No. 19 of 2020, this V. Ganesh Kumar is stated to have collected amounts ranging from Rs. 2,00,000/- to Rs. 4,50,000/- for every post of Driver, Conductor or Mechanic, as the case may be. We do not know whether the Transport Corporation has at least placed him under suspension and initiated departmental proceedings.

If they have not done so far, the Corporation should initiate disciplinary action against this V. Ganesh Kumar not only for being party to a job-for-cash scam but also for turning turtle and supporting the accused and thereafter coming to this Court to assail the order of de novo investigation, despite being an employee of the Corporation. [Para 47][1065-C-D] 6. ED registered an Information Report on 29. 07. 2021, only after filing of a Final Report under Section 173(8) of the Code. , in CC No. 24 of 2021, including the offences punishable under the PC Act. This Final Report was in FIR No. 441 of 2015, which was originally registered as CC No. 3627 of 2017 (it became CC No. 24 of 2021). The Final Report filed under Section 173(8) of the Code on 08. 03. 2021, named Shri V. Senthil Balaji (Minister) as Accused No.

1 and the offences charged against the accused were under Sections 406, 419, 420 read with Section 34 and 120B, 465, 467, 471 and 201 IPC read with Sections 7, 12, 13(2) read with Section 13(1)(d) of the PC Act and Section 109 of IPC. Since the offences under Sections 120B, 419, 420, 467 and 471 of IPC and Sections 7 and 13 of the PC Act are included in The Schedule to the Prevention of Money-laundering Act, 200211, the registration of the Information Report by ED on 29. 07. 2021 cannot be faulted. [Para 50][1066-B-D] 7. The High Court has not quashed the summons issued by ED. The High Court had merely injuncted ED from proceeding further till the clog on the cases relating to the predicate offences is removed. Interestingly, none of the accused has come up with any appeal challenging the order of the High Court dated 01. 09. 2022, on the ground that the High Court ought to have quashed the summons issued by the ED in total, on other grounds.

Instead, the accused appeared through counsel only to defend the impugned order dated 01. 09. 2022. Therefore, in law, (i) once the dismissal of the petition for discharge has attained finality with the dismissal of Criminal Revision Case No. 224 of 2021; (ii) once the order for de novo investigation in Criminal O. P. No. 15122 of 2021 is set aside; (iii) once the order of the High Court dated 30. 03. 2022 relating to right of the ED to secure the copies of documents is dealt with; (iv) once the order of the High Court dated 30. 07. 2021 quashing one of the criminal cases is set aside; and (v) once the stay operating in two of the criminal cases for predicate offences is vacated, then the temporary reprieve that has been granted by the High Court to the accused in the impugned order would automatically go.

Realising this difficulty in law, the accused changed the theme of the song completely before us, despite the fact that they were ordained as respondents in the appeals only to support the impugned order of the High Court. In fact, all the learned senior counsel appearing for all the accused in the PMLA case, advanced arguments for the grant of larger reliefs than what they got under the impugned order, without even filing any appeal against the same. It is possible in law for a successful party (though in civil proceedings) to support the decree without supporting the judgment. But what the accused sought to do before us was to support the judgment and seek an enlargement of the decree, without independently filing appeals. Since they took a chance by adopting such a course, they may not even be able to challenge the impugned order hereafter, once the seal of approval on the same is affixed by this Court and the doctrine of merger comes into play. [Paras 67-70][1072-A-F] 8.

1 If the main part of Section 3 is dissected with forensic precision, it will be clear that Section 3 addresses itself to three things (we may call them 3 'P's) namely, (i) person; (ii) process or activity; and (iii) product. Insofar as persons covered by Section 3 are concerned, they are, (i) those who directly or indirectly attempt to indulge; or (ii) those who knowingly assists; or (iii) those who are knowingly a party; or (iv) those who are actually involved. Insofar as process is concerned, the Section identifies Y. BALAJI v. KARTHIK DESARI & ANR. ETC. six different activities, namely (i) concealment; (ii) possession; (iii) acquisition; (iv) use; (v) projecting; or (vi) claiming as untainted property, any one of which is sufficient to constitute the offence. Insofar as product is concerned, Section 3 identifies "proceeds of crime" or the property representing the proceeds of crime as the product of the process or activity.

Out of the three things that Section 3 addresses, namely (i) person; (ii) process; and (iii) product, the first two do not require any interpretation or definition. The third aspect namely "product", which Section 3 refers to as "proceeds of crime" requires a definition and hence it is defined in Section 2(1)(u). [Paras 96 and 97][1088-A-D] 8. 2 All the three FIRs allege that the accused herein had committed offences included in the Schedule by taking illegal gratification for providing appointment to several persons in the Public Transport Corporation. In one case it is alleged that a sum of more than Rs. 2 crores had been collected and in another case a sum of Rs. 95 lakhs had been collected. It is this bribe money that constitutes the 'proceeds of crime' within the meaning of Section 2(1)(u). It is no rocket science to know that a public servant receiving illegal gratification is in possession of proceeds of crime.

The argument that the mere generation of proceeds of crime is not sufficient to constitute the offence of moneylaundering, is actually preposterous. As we could see from Section 3, there are six processes or activities identified therein. They are, (i) concealment; (ii) possession; (iii) acquisition; (iv) use; (v) projecting as untainted property; and (vi) claiming as untainted property. If a person takes a bribe, he acquires proceeds of crime. So, the activity of "acquisition" takes place. Even if he does not retain it but "uses" it, he will be guilty of the offence of money- laundering, since "use" is one of the six activities mentioned in Section 3. The FIRs for the predicate offences identify all the three components of Section 3, namely, (i) persons; (ii) process; and (iii) product. Persons accused in the FIRs are those who have indulged in the process or activity. The illegal gratification that they have taken, represents the proceeds of crime.

The (i) acquisition of such illegal gratification in the first instance; (ii) the possession of the tainted money before putting it to use; and (iii) today projecting it as untainted money, is the process or activity in which the accused have indulged. The corruption money represents the proceeds of crime. [Paras 99, 100][1089-A-F] 8. 3 It is true that there are some offences, which, though scheduled offences, may or may not generate proceeds of crime. For instance, the offence of murder punishable under Section 302 is a scheduled offence. Unless it is a murder for gain or murder by a hired assassin, the same may or may not generate proceeds of crime. It is in respect of such types of offences that one may possibly argue that mere commission of the crime is not sufficient but the generation of proceeds of crime is necessary. In the case of an offence of corruption, the criminal activity and the generation of the proceeds of crime are like Siamese twins.

Even if an intangible property is derived as a result of criminal activity relating to a scheduled offence, it becomes proceeds of crime under Section 2(1)(u). In view of the above, we are not impressed with the contention that the investigation by ED was triggered without any foundational/jurisdictional facts. In our view, the allegations in the FIR point out to (i) involvement of persons in criminal activity relating to scheduled offences; (ii) the generation as well as (iii) laundering of the proceeds of crime within the meaning of Section 3. This is in view of the fact that wherever there are allegations of corruption, there is acquisition of proceeds of crime which itself tantamount to money-laundering. [Paras 102, 104][1089-G-H; 1090-A, E-F] 8. 4 Once an information relating to the acquisition of huge amount of illegal gratification in the matter of public employment has come into the public domain, it is the duty of the ED to register an Information Report.

This is because "acquisition" is an activity amounting to money-laundering and the illegal gratification acquired by a public servant represents "proceeds of crime," generated through a criminal activity in respect of a scheduled offence. Therefore, it does not require any expedition, much less a fishing expedition for someone to say that the receipt of bribe money is an act of money-laundering. The contention that there was no explanation for the delay on the part of the ED in registering the Information Report, is a self-serving argument. If the ED registers an Information Report immediately upon the Y. BALAJI v. KARTHIK DESARI & ANR. ETC. registration of a FIR for a predicate offence, ED will be accused of acting in haste. If they wait until the drama unfolds up to a particular stage, ED will be attacked as guilty of delay. The accused should be thankful to ED for giving a long rope from 2016 till 2021.

Therefore, all the arguments on facts and all the legal contentions emanating from some portions of the judgment in Vijay Madanlal Choudhary, to challenge the validity of the proceedings initiated by ED are completely unsustainable. [Paras 112-114][1092-B-F] 9. A notice ordered in the review petition being Review Petition (Crl. ) No. 219 of 2022, will not destroy or diminish the precedential value of Vijay Madanlal Choudhary. The argument of the learned counsel for the accused, if accepted, will not only destroy the principles of judicial discipline and the doctrine of stare decisis, but also bring to a grinding halt, all pending investigation in the country. In fact, the order dated 25. 08. 2022 passed in Review Petition (Crl. ) No. 219 of 2022 discloses that prima facie the Court was of the view that at least two of the issues raised in the review petition require consideration.

Though it is not precisely spelt out in the order, those two issues relate to (i) not providing the accused with a copy of the ECIR; and (ii) reversal of the burden of proof and presumption of innocence. The points that the respondents are canvasing in this case, have nothing to do with those two issues. Therefore, the accused cannot have a piggyback ride on the review petition. In fact, as we have pointed out elsewhere, the accused have not come up with any appeal challenging the order of the High Court dated 01. 09. 2022. Therefore, they are entitled at the maximum, to argue only for the dismissal of the appeals filed by ED and others against the said decision. Suppose we agree with the learned counsel for the accused and dismiss the appeals filed by ED, even then they cannot have an escape route since the impugned order of the High Court protects them only till the other proceedings are kept at bay.

Therefore, the accused is not entitled at all either to seek a reference to a larger Bench or to seek to defer the matter till a decision is rendered in the matters involving larger issues. In view of the above, the appeals arising out of the order of the Division Bench of the High Court are liable to be allowed. Accordingly, these appeals are allowed and the order of the Division Bench of the Madras High Court dated 01. 09. 2022 is set aside. ED will now be entitled to proceed further from the stage at which their hands were tied by the impugned order. [Paras 116-119][1093-A-F] Vijay Madanlal Choudhary vs. Union of India2022 SCC OnLine SC 929 - referred to. 10. The grievance of the appellant in this appeal is that the High Court has overlooked the provisions of Rule 231(3) of the Rules, 2019 and also Section 65B of the Indian Evidence Act, 1872. But both the above contentions are without substance.

Rule 231 primarily deals with the grant of certified copies of certain other documents to the accused, before filing of the Final Report. Rule 231(3) states that certified copies of unmarked documents shall not be given. The High Court has not passed any order directing the grant of certified copies of unmarked documents. All that the High Court has done is permitting the ED to have an inspection of the documents under Rule 237 and thereafter to file a proper copy application. This is not contrary to Rule 231(3). We do not know how an argument revolving around Section 65B of the Evidence Act is raised. Section 65B concerns the admissibility of electronic records. Without certification, ED may not be able to use those electronic records in evidence, in the prosecution under PMLA. But it does not mean that they cannot even have a look at the electronic record. Therefore, we find no merits in the appeal. Hence, the appeal challenging the order of the High Court dated 30. 03.

2022 passed in Criminal O. P. No. 5726 of 2022 is dismissed. [Paras 122-124][1094-C-F] 11. The appeals arising out of the order for de novo investigation are allowed. That portion of the order of the High Court dated 31. 10. 2022 passed in Criminal O. P. No. 15122 of 2021 is set aside. The directions issued in the said original petition for de novo investigation are set aside. The Investigation Officer shall proceed with further investigation in all cases by including the offences under the PC Act. Any let up on the part of the Investigation Officer in this regard will pave the way for this Court to consider appointing a Special Investigation Team in future. (ii) Y. BALAJI v. KARTHIK DESARI & ANR. ETC. The appeals arising out of the order of the Division Bench of the High Court dated 01. 09. 2022 are allowed. The order dated 01. 09. 2022 is set aside. All the three writ petitions challenging the initiation of proceedings by ED shall stand dismissed.

(iii) The appeal arising out of the order of the High Court dated 30. 03. 2022 is dismissed. (iv) The appeal challenging the orders dated 27. 11. 2019 and 01. 11. 2021 of the High Court relating to extension of time for completion of investigation is dismissed. The Investigation Officer shall proceed with further investigation and file Further/Final Reports within two months. (v) The Contempt Petitions and I. A. No. 26257 of 2023 are dismissed. [Para 133][1096-F-H; 1097-A-C] P. Dharamaraj vs. Shanmugam 2022 SCC OnLine SC 1186;Dharmaraj vs. Shanmugam 2022(13) SCALE 142; Vinay Tyagi vs. Irshad Ali alias Deepak (2013) 5 SCC 762 : [2012] 13 SCR 1005;Arun Kumar vs. Union of India (2007) 1 SCC 732 : [2006] 6 Suppl. SCR 290; Bihta Co-operative Development and Cane Marketing Union Ltd. vs. Bank of BiharAIR 1967 SC 389 : [1967] SCR 848;Union of India vs. Ganpati Dealcom Private Limited (2023) 3 SCC 315; Shauqin Singh vs. Desa Singh (1970) 3 SCC 881; Enforcement Directorate vs.

Gagandeep Singh2022 SCC Online Del 514;Parvathi Kollur vs. State through ED Crl. Appeal No. 1254/2022 dt. 16. 08. 2022;Jairam Ramesh vs. Union of India SLP (C) No. 13103 of 2019;Thomas Franco Rajendra Dev vs. Union of India WP (C) No. 366/2022 dated 12. 05. 2022; Kantaru Rajeevaru (Right to Religion, In re-9 J. ) vs. Indian Young Lawyers Association (2020) 9 SCC 121;Asgar Ali vs. State of Jammu and Kashmir 2022 SCC Online SC 3095;Central Board of Dawoodi Bohra Community vs. State of Maharashtra 2023 SCC Online SC 129;Badrinath vs. Government of Tamil Nadu(2000) 8 SCC 395 : [2000] 3 Suppl. SCR 573; State of Kerala vs. Puthenkavu N. S. S. Karayogam (2001) 10 SCC 191;State of Punjab vs. Davinder Pal Singh Bhullar (2011) 14 SCC 770: [2011] 15 SCR 540; Management of the Northern Railway Co-operative Credit Society Ltd. , Jodhpur vs. Industrial Tribunal, Rajasthan, Jaipur(1967) 2 SCR 476;Sakshi vs. Union of India (2004) 5 SCC 518 : [2004] 2 Suppl.

SCR 723; Central Board of Dawoodi Bohra Community vs. State of Maharashtra (2005) 2 SCC 673 : [2004] 6 Suppl. SCR 1054 - referred to. Street Tramways vs. London County Council (1898) AC 375 (378);Redcliffe vs. Ribble Motor Services(1939) AC 215 (245) - referred to. Case Law Reference [2012] 13 SCR 1005 referred to para 26 [1992] 1 Suppl. SCR 226 held inapplicable para 45 (1992) 4 SCC 653 referred to para 45 [2006] 6 Suppl. SCR 290 referred to para 60 [1967] SCR 848 referred to para 72 (2023) 3 SCC 315 referred to para 74 (1970) 3 SCC 881 referred to para 78 [2006] 6 Suppl. SCR 290 referred to para 78 (2020) 9 SCC 121 referred to para 81 [2000] 3 Suppl. SCR 573 referred to para 82 (2001) 10 SCC 191 referred to para 82 [2011] 15 SCR 540 referred to para 82 [1967] 2 SCR 476 referred to para 84 [2004] 2 Suppl. SCR 723 referred to para 85 [2004] 6 Suppl. SCR 1054 referred to para 85 CRIMINAL APPELLATE JURISDICTION : Criminal Appeal Nos. 1671-1673 of 2023.

From the Judgment and Order dated 01. 09. 2022 of the High Court of Judicature at Madras in WP Nos. 18213, 18209 and 12159 of 2022. With Y. BALAJI v. KARTHIK DESARI & ANR. ETC. Criminal Appeal Nos. 1674, 1677, 1675-1676, 1678, 1658-1661, 1663-1664, 1662, 1679 of 2023, Contempt Petition (C) Nos. 750-751 of 2023 And Criminal Appeal Nos. 1680, 1681-1682, 1665 of 2023 Tushar Mehta, Solicitor General, Ms. Aishwarya Bhati, A. S. G. , Amit Anand Tiwari, A. A. G. , Gopal Sankaranarayan, C. A. Sundaram, Mukul Rohatgi, Kapil Sibal, Sidharth Luthra, Siddharth Dave, Siddharth Agarwal, Ranjit Kumar, Ms. V. Mohana, Sr. Advs. , A. Lakshminarayanan, B. Karunakaran, Nar Hari Singh, Balaji Srinivasan, Ms. Gauri Pasricha, Ms. Aakriti Priya, Shiva K. , Devamshu Behl, Rohan Dewan, Lakshmi Rao, Ms. Jhanvi Dubey, D. Raghu, K. Sathiresan, Scv Vimal Pani, Ms. Garima Jain, Balaji Srinivasan, Ms. Misha Rohatgi, Nakul Mohta, Ms. Riya Dhingra, Devansh Srivastava, Bharat Monga, Ms.

Rohini, Zafar, Mukesh Kumar Maroria, Prashant Bhushan, N Subramaniyan, Pranav Sachdeva, Jatin Bhardwaj, Ms. Neha Rathi, Ms. Aakriti, S. Senthil, C. Pandian, M. Thangathurai, Aditya Kishor Tyagi, T. S. Nanda Kumar, Yusuf, Dr. Ram Sankar, N. Bharani Kumar, Ms. Anusha Nagarajan, Ms. Rupali Samuel, Ms. Sumedha Roy Sarkar, Anand Kumar V. , G. Jai Singh, M/s. Ram Sankar & Co, Senthil Jagadeesan, Sajal Jain, Ms. Anasuya Choudhury, Rudraditya Khare, Ms. Misha Rohatgi, Nakul Mohta, Ms. Riya Dhingra, Bharat Monga, Ms. Alina Merin Mathew, Samyak Jain, Mohd. Owais, Aakash Kumar, Gaurav Agrawal, Mayank Pandey, Ashish Kumar Pandey, Arkaj Kumar, Madhav Sinhal, Ms. Deepabali Dutta, Kanu Agarwal, Vivek Gupta, Zoheb Hussain, Dr. Joseph Aristotle S. , Ms. Devyani Gupta, Shobhit Dwivedi, Ms. Vaidehi Rastogi, Kanu Agarwal, Vivek Gupta, Sarad Kumar Singhania, Zoheb Hussain, Ms. Bhavya Pande, Ms. Sneha Botwe, Advs. for the appearing parties. The Judgment of the Court was delivered by V. RAMASUBRAMANIAN, J.

Permission to file special leave petition(s) is granted. 2. Delay condoned. 3. Leave granted. 4. Aggrieved by two independent orders, one passed by a learned Judge of the Madras High Court on 31. 10. 2022 disposing of a batch of criminal petitions and the other passed by the Division Bench of the Madras High Court on 01. 09. 2022, putting on hold an investigation by the Enforcement Directorate1, various persons such as (i) the de-facto 1 For short, "ED" complainants; (ii) third parties; (iii) the accused; and (iv) the ED have come up with these batch of appeals.

Other than the batch of appeals arising out of the said two orders of the High Court, there are also two appeals, one challenging the refusal of the High Court to extend the time for completion of investigation and another challenging an order passed by the Division Bench of the High Court granting limited relief to the Enforcement Directorate to access certain documents available on record in the Special Court trying the predicate offences. Apart from these appeals, there are also two contempt petitions and an application seeking the constitution of a Special Investigation Team. 5. We have heard Shri Tushar Mehta, learned Solicitor General appearing for the ED, Shri Gopal Sankaranarayan, learned senior counsel, Shri Prashant Bhushan and Shri Balaji Srinivasan, learned counsel appearing for one set of parties (victims and a NGO), Shri Kapil Sibal, Shri C. A. Sundaram, Shri Sidharth Luthra, Shri Mukul Rohatgi, learned senior counsel appearing for another set of parties (accused), Ms.

V. Mohana and Shri Siddharth Agrawal, learned senior counsel appearing for the de facto complainants and Shri Ranjit Kumar, learned senior counsel appearing for the State of Tamil Nadu. Background Facts 6. The background facts necessary to understand the complexities of the batch of cases on hand are as follows: (i) In November 2014, the Metropolitan Transport Corporation, wholly owned by the State of Tamil Nadu issued five Advertisements, in Advertisement Nos. 1/2014 to 5/2014, calling for applications for appointment to various posts such as Drivers (746 posts), Conductors (610 posts), Junior Tradesman (Trainee) (261 posts), Junior Engineer (Trainee) (13 posts) and Assistant Engineer (Trainee) (40 posts); (ii) After interviews were held on 24. 12. 2014 and the Select List got published, one Devasagayam lodged a complaint on 29. 10. 2015 with the Chennai PS CCB against 10 individuals, alleging that he paid a sum of Rs.

2,60,000/- to a Conductor by name Palani for getting the job of Conductor in the Transport Corporation for his son. However, his son did not get a job and when he confronted Palani, he was directed to several persons. When he demanded at least the refund of money, he did not get it. Therefore, he lodged a complaint which was registered as FIR No. 441 of 2015 for alleged offences under Sections 406, 420 read Y. BALAJI v. KARTHIK DESARI & ANR. ETC. [V. RAMASUBRAMANIAN, J. ] with Section 34 of the Indian Penal Code, 18602. In this complaint, the accused who are now before us, including the one who is holding the post of Minister in the Government of Tamil Nadu were not implicated. (iii) Similarly, one Gopi gave a petition dated 07. 03.

2016 to the Commissioner of Police claiming that he had applied for the post of Conductor and that after the interviews, he was approached by one Ashokan claiming to be the brother and one Karthik claiming to be the brother-in-law of the Minister Senthil Balaji, demanding a bribe for securing appointment and that he had paid a sum of Rs. 2,40,000/- to those persons. Complaining that the Police did not register his complaint, the said Gopi filed a petition in Crl. OP No. 7503 of 2016 on the file of the High Court of Judicature at Madras under Section 482 of the Code of Criminal Procedure, 19733 seeking a direction to the Commissioner of Police to register his complaint and investigate the same. (iv) The said Crl. OP No. 7503 of 2016 filed by Gopi was disposed of by a learned Judge of the High Court by an Order dated 20. 06. 2016.

In the said order, it was recorded that according to the Additional Public Prosecutor, 81 persons had given similar complaints to the Police and that the complaint given by Devasagayam had been registered as FIR No. 441 of 2015. The Additional Public Prosecutor took a stand before the High Court in the said petition filed by Gopi that all the 81 persons including Gopi will be enlisted as witnesses in the complaint registered at the instance of Devasagayam. (v) When it was stated by the Additional Public Prosecutor at the time of hearing of the petition filed by Gopi that all 81 persons including Gopi will be cited as witnesses, in the complaint filed by Devasagayam, the petitioner Gopi objected to the same on the ground that Devasagayam had already been won over by the accused. In fact, it was pointed out that the Minister did not figure as an accused in the complaint of Devasagayam.

A specific grievance was projected by Gopi that the Police are not going beyond the lower level officers. Accepting his statement, the High Court passed an Order dated 20. 06. 2016 in Crl. OP No. 7503 of 2016 filed by Gopi, holding that the Police is duty bound to probe beyond the lower level minions to find out where the money had gone. After so holding, the Court directed the Assistant Commissioner of Police, Central Crime Branch (Job Racketing) to take over the investigation in 2 For short "IPC" 3 For Short "the Code" FIR No. 441 of 2015 and also directing the Deputy Commissioner of Police to monitor the same. The Court also held that since a FIR has already been registered at the behest of Devasagayam, it is not necessary to have another FIR registered on the complaint/representation made by Gopi. (vi) Despite the direction issued by the High Court on 20. 06.

2016 to the Police to go beyond lower level officers and find out where the money trail ends (more than about 2 crores allegedly given to the Minister during January and March, 2015) and despite Gopi making specific averments against the brother and brother-in-law of the Minister, the Police filed a Final Report on 13. 06. 2017 under Section 173(2) of the Code, only against 12 individuals including those 10 persons named by Devasagayam. Upon the filing of the Final Report, the case got numbered as Calendar Case No. 3627 of 2017 in FIR No. 441 of 2015. Neither the Minister nor his brother or brother-in-law, were cited as accused, in the Final Report. The accused named in the Final Report were charged only for the offences under Sections 406, 420 and 419 read with Section 34 IPC and not under any provisions of the Prevention of Corruption Act, 19884. (vii) One V. Ganesh Kumar then lodged a criminal complaint in FIR No. 298 of 2017 on 09. 09.

2017 with the Chennai PS CCB, against four persons including the Minister Senthil Balaji. It was stated in his complaint that he was an employee of the Transport Department and that one of his colleagues by name Annaraj and his friend R. Sahayarajan were taken by one Prabhu (a relative of the Minister) to the house of the Minister Senthil Balaji and that the Minister instructed them to collect money from persons aspiring to get appointment as Drivers and Conductors. It was further stated in the complaint that as per the directions of the Minister, an amount totaling to Rs. 95 lakhs was collected during the period from 28. 12. 2014 to 10. 01. 2015 and that though the amount was given to Prabhu and Sahayarajan, the persons who parted with money did not get appointed. Therefore, persons who paid money started exerting pressure upon V. Ganesh Kumar forcing him to lodge a complaint on 09. 09. 2017. Even this complaint, registered as FIR No.

298 of 2017, was only for offences under Sections 406, 420 and 506(1). A Final Report was filed on 07. 06. 2018 in FIR No. 298 of 2017, against the Minister Senthil Balaji and three others, only for offences punishable under 4 For short, "PC Act" Y. BALAJI v. KARTHIK DESARI & ANR. ETC. [V. RAMASUBRAMANIAN, J. ] Sections 420 and 506(1) read with Section 34 IPC. This Final Report was filed before the Special Court and the case was numbered as CC No. 19 of 2020. Despite specific allegations, the offences under the PC Act were not included. (viii) Another complaint was lodged by one K. Arulmani, on 13. 08. 2018 with the Commissioner of Police, Chennai City, complaining that a huge amount of Rs. 40,00,000/- was collected by his friends who wanted to get employment in the Transport Corporation and that the money was actually paid to Shanmugam, PA to the Minister at the residence of the Minister in the first week of January, 2015.

It was further stated in the complaint that after money was paid to Shanmugam, the complainant also met Ashok Kumar (brother of the Minister) and Senthil Balaji (Minister) and that the Minister assured to get appointment orders issued. This complaint was registered by Chennai CCB PS as FIR No. 344 of 2018, again for offences only under Section 406, 420 and 506(1) IPC. We do not know why the State Police were averse to the idea of including the offences punishable under the PC Act, in any of the three FIRs. While one may be averse to corruption, one cannot be averse to the PC Act. (ix) As had happened in respect of the other two complaints, the complaint in FIR No. 344 of 2018 was also investigated (or not investigated) and a Final Report was filed on 12. 04. 2019. Even this Final Report, taken on record in Calendar Case No. 25 of 2021 did not include the offences under the PC Act. (x) At this juncture, a person by name R. B.

Arun Kumar, working as a Driver in the Metropolitan Transport Corporation and who was cited as witness LW 47 in the Final Report in CC No. 3627 of 2017 arising out of FIR No. 441 of 2015 (Devasagayam's complaint) moved the Madras High Court by way of a petition under Section 482 of the Code in Crl. O. P No. 32067 of 2019, seeking further investigation in the case, on the ground that the State Police have not acted as per the directions issued by the High Court in its order dated 20. 06. 2016 in Crl. O. P. No. 7503 of 2016 to go beyond the lower level officers. In his petition, R. B. Arun Kumar also pointed out that the specific allegation of a huge amount of more than Rs. 2 crores, having been paid to the Minister Senthil Balaji, had been completely suppressed by the investigating agency and that a dummy charge-sheet had been filed against minions. Therefore, by an order dated 27. 11.

2019, the High Court directed the Assistant Commissioner of Police, CCB (Job Racketing) to conduct further investigation in CC No. 3627 of 2017 and to complete the same within six months. (xi) Emboldened by the non-inclusion of the offences under the PC Act in any of the three charge-sheets, Minister Senthil Balaji, arrayed as Accused No. 1 in CC No. 19 of 2020 arising out of FIR No. 298 of 2017 lodged by V. Ganesh Kumar, filed a petition in Criminal M. P. No. 7968 of 2020 seeking his discharge in CC No. 19 of 2020. But the Special Court dismissed the petition for discharge, by an order dated 26. 08. 2020. Against the said order dismissing his discharge petition, the Minister filed a criminal revision petition in Crl. R. C. No. 224 of 2021 on the file of the High Court (xii) But in the meantime, a Final (further) Report under Section 173(8) of the Code was filed in C. C. No.

24 of 2021 against 47 persons including the Minister Senthil Balaji and Shanmugam (PA to the Minister) in which the offences under the PC Act were included. (xiii) Upon coming to know of the way in which the entire recruitment of candidates to various posts in the Transport Corporation had gone on, candidates who appeared for the selection but did not get selected started filing writ petitions, challenging the entire selection. A writ petition in WP No. 9061 of 2021 was filed by one A. Nambi Venkatesh seeking to set at naught, the appointment of Junior Engineers. Similarly, one P. Dharmaraj and M. Govindarasu filed a writ petition in WP No. 8991 of 2021, with regard to the post of Assistant Engineers. (xiv) In May, 2021 the political climate in the State changed. Though the principal actors changed, the script remained the same for the victims and the political fortunes of the Minister continued, as he got a berth in the Cabinet, even in the new dispensation.

(xv) Thereafter, the person alleged to be the PA to the Minister, namely, Shanmugam, who was arrayed as Accused No. 3 in CC No. 25 of 2021 arising out of FIR No. 344 of 2018 lodged by Arulmani, filed a petition in Crl. O. P No. 13374 of 2021 on the file of the High Court seeking to quash CC No. 25 of 2021. He claimed in the said petition that a compromise had been reached between the victims (Arulmani and others and the accused) and that, therefore, the complaint may be quashed. Following suit, R. Sahayarajan who was Accused No. 3 in CC No. 19 of 2020 also filed a quash petition in Crl. O. P No. 13914 of 2021, enclosing a Y. BALAJI v. KARTHIK DESARI & ANR. ETC. [V. RAMASUBRAMANIAN, J. ] joint compromise memo seeking to quash CC No. 19 of 2020. Similarly, one Vetrichelvan (Accused No. 10) filed Crl. O. P No. 6621 of 2021 for quashing the proceedings in CC No. 24 of 2021. (xvi) By an order dated 30. 07. 2021, the High Court quashed CC No.

25 of 2021 on the basis of the Joint Compromise Memo. This order was passed completely overlooking the nature of the allegations, the offences for which the accused ought to have been charged as well as the previous orders passed by the High Court itself. (xvii) Just a day before the High Court passed orders quashing CC No. 25 of 2021, the ED registered an Information Report on 29. 07. 2021 in ECIR/MDSZO/21/2021 and issued summons to the Minister Senthil Balaji. (xviii) At this stage, Devasagayam who filed the first complaint in FIR No. 441 of 2015 and in whose case a Final Report was filed in CC No. 3627 of 2017, filed a very strange petition on the file of the High Court in Crl. O. P. No. 15122 of 2021 seeking de novo investigation in CC No. 24 of 2021. It must be recalled at this stage that Devasagayam's complaint was registered as FIR No. 441 of 2015 dated 29. 10. 2015 and a Final Report was filed therein on 13. 06. 2017 leading to Calendar Case No. 3627 of 2017.

But by the orders of the High Court, the complaint of Gopi and others got clubbed with the investigation in Devasagayam's case leading to the registration of a separate Calendar Case in CC No. 24 of 2021. The clubbing actually happened after an allegation was made before the High Court by Gopi, (petitioner in Crl. O. P No. 7503 of 2016) to the effect that Devasagayam had been won over. While ordering the complaint of Gopi to be clubbed with the investigation in FIR No. 441 of 2015, the High Court did not perhaps realize that it may enable Devasagayam to derail (incidentally he had retired from Railways and the word "derail" suits him) even the proceedings in CC No. 24 of 2021.

(xix) Finding that the offences under the PC Act were included only in one of the cases and not in others and that it had enabled the High Court even to quash one of the four calendar cases on the basis of a Joint Compromise Memo, candidates who were unsuccessful in the recruitment and who had filed writ petitions in the High Court challenging the process of selection, filed impleadment petitions, both in the quash petitions in other cases as well as in the petition filed by Devasagayam for de novo investigation. (xx) At this stage, ED filed miscellaneous petitions in CC Nos. 19/20, 24/21 and 25/21 before the Trial Court seeking certified copies of the FIR, statements of witnesses, Final Report, etc. By an order dated 09. 11. 2021, the Trial Court directed the supply of certified copies of the FIRs, complaints and the statements under Sections 161 and 164 of the Code. However, the Trial Court refused to issue certified copies of unmarked documents. (xxi) As against the order dated 30.

07. 2021 passed by the Madras High Court quashing CC No. 25 of 2021 on the basis of the Joint Compromise Memo, a special leave petition was filed by one P. Dharmaraj. It may be recalled that he was one of the unsuccessful candidates and he had filed a writ petition seeking to quash the entire selection. (xxii) An NGO by name Anti-Corruption Movement also filed a special leave petition against the order of the High Court quashing CC No. 25 of 2021. (xxiii) Aggrieved by one portion of the order of the Trial Court refusing to grant certified copies of unmarked documents, the ED filed petitions before the High Court. By an order dated 30. 03. 2022 the High Court permitted ED to conduct an inspection under Rule 237 of the Criminal Rules of Practice, 20195 and thereafter to make third party copy applications for supply of copies of documents.

The High Court also noted that under Rule 238, ED was entitled even to take extracts and thereafter file a fresh third party copy application before the Special Court. Challenging the limited relief granted by the High Court to ED in its order dated 30. 03. 2022, a person who is Accused No. 3 in CC No. 3627 of 2017 (CC No. 24/2021) has come up with a special leave petition which forms part of the present batch of cases. (xxiv) Thereafter, three writ petitions came to be filed, one by Minister Senthil Balaji and another by Shanmugam, alleged to be his Secretary and the third by Ashok Kumar (brother of the Minister), challenging the summons issued by ED. These writ petitions were allowed by the High Court by an order dated 01. 09. 2022, primarily on the ground that one of the four calendar cases had already been quashed by the High Court by order dated 30. 07.

2021 on the basis of a Joint Compromise Memo and that further proceedings in the other calendar cases had been stayed by the High Court. 5 For short "Rules, 2019" Y. BALAJI v. KARTHIK DESARI & ANR. ETC. [V. RAMASUBRAMANIAN, J. ] (xxv) But by a Judgment dated 08. 09. 2022, this Court overturned the order of the High Court dated 30. 07. 2021 and not only restored the calendar cases back to file but also directed the inclusion of the offences under the PC Act. (xxvi) Despite the Judgment of this Court dated 08. 09. 2022, the High Court passed an order dated 31. 10. 2022 allowing the petition filed by Devasagayam and ordered a de novo investigation. (xxvii) Therefore, challenging the order of the High Court dated 01. 09. 2022 quashing the summons issued by them, ED has come up with three appeals and the candidate who was unsuccessful in the selection and who has filed a writ petition before the High Court has come up with one appeal.

(xxviii) Challenging the order of the High Court dated 31. 10. 2022 directing de novo investigation, the ED has come up with one appeal, two candidates who were unsuccessful in the selection have come up with two separate appeals, Anti-Corruption Movement has come up with one appeal, the person who compromised the matter with the accused and supported the accused before the High Court for quashing the complaint has come up with one appeal and one of the accused has come up with another appeal. (xxix) In other words, we have four appeals on hand arising out of the order of the High Court dated 01. 09. 2022 quashing the summons issued by ED. Similarly, we have six appeals challenging the order dated 31. 10. 2022 passed by the High Court directing de novo investigation. (xxx) We have two more appeals, which do not form part of the main stream. One of them is by an accused challenging the order of the High Court dated 30. 03.

2022, permitting the ED to conduct an inspection of the documents before the Trial Court under Rule 237 of the Rules, 2019. Another appeal is filed by the unsuccessful candidate challenging an order passed by the High Court dismissing a petition for extension of time to complete investigation. (xxxi) Thus, we have on hand 12 appeals, four of them challenging the quashing of summons issued by ED, six of them challenging the order for de novo investigation, one of them challenging an order permitting ED to have inspection of documents and the last arising out of the order refusing to grant further time for completion of investigation. (xxxii) Other than the appeals, we also have two contempt petitions filed by the Anti-Corruption Movement, complaining willful disobedience by the State of the directions issued by this Court in the order dated 08. 09. 2022 in Criminal Appeal Nos. 1515-1516 of 2022. (xxxiii) We also have an application in IA No.

26527 of 2023 filed by the appellant in one of these appeals, who is an unsuccessful candidate. The prayer in this application is for the constitution of a Special Investigation Team to undertake a comprehensive investigation into the entire scam and for the appointment of a senior lawyer of repute as the Special Public Prosecutor to prosecute the accused. This application is taken out on the ground that a similar prayer made in Criminal Appeal Nos. 1514-1516 of 2022 was turned down by this Court, in the order dated 08. 09. 2022, in the hope that the State Police would act fairly and impartially. According to the applicant/appellant, the State Police had belied the hope expressed by this Court and that therefore it is now time to constitute a Special Investigation Team. 7.

Since the batch of appeals on hand (not including the contempt petitions and the application for constitution of a Special Investigation Team) arise out of four different orders of the High Court, let us divide this Judgment into four parts, the first dealing with the challenge to the order for de novo investigation; the second dealing with the challenge to the order setting aside the summons issued by ED; the third dealing with the order permitting the ED to have inspection of the records of the Trial Court; and the fourth dealing with an order refusing to grant extension of time to complete investigation. Part-I (Challenge to the order for de novo investigation) 8. As we have pointed out earlier, de novo investigation has been ordered by the High Court by its decision dated 31. 10. 2022 at the instance of one Devasagayam, who was the first person to lodge a complaint way back on 29. 10. 2015 alleging that one C. Palani working in the Transport Corporation received a sum of Rs.

2,60,000/- for securing the job of a Conductor for his son and that he and his accomplices committed offences punishable under Sections 406 and 420 read with Section 34 IPC. This complaint was registered as FIR No. 441 of 2015. Despite the fact that the allegations of Devasagayam related to payment of money to an employee of the Transport Corporation for procuring a job for his son, the offences under the PC Act were not included in the FIR. Interestingly, Devasagayam is a retired employee of the Railways. While Y. BALAJI v. KARTHIK DESARI & ANR. ETC. [V. RAMASUBRAMANIAN, J. ] he was happy about paying illegal gratification for procuring employment for his son, he was not unhappy about the Police not including the offences under the PC Act in FIR No. 441 of 2015. 9. This attitude of Devasagayam was responsible for an allegation being made against Devasagayam in a petition filed by another victim by name Gopi, in Criminal O. P. No.

7503 of 2016, that Devasagayam had been won over by the accused. 10. On Devasagayam's complaint, the Investigating Officer filed a Final Report on 13. 06. 2017, which led to the registration of a Calendar Case in CC No. 3627 of 2017. Even in this Final Report, the offences under the PC Act were not included. Devasagayam did not bother to question the Police or move the Court as to why the offences under the PC Act were not included. 11. But fortunately, pursuant to the order passed by the High Court in the petition filed by Gopi, another Calendar Case came to be registered in CC No. 24 of 2021, on a further Report submitted by the Police under Section 173(8) of the Code. In this CC No. 24 of 2021, the Minister and his accomplices were included as accused and the offences under the PC Act were included. 12. This further Report under Section 173(8) of the Code which culminated in the registration of CC No. 24 of 2021 was filed on 08. 03. 2021. 13.

The inclusion of the name of the Minister and his accomplices in the Final Report submitted under Section 173(8) and the inclusion of the offences under the PC Act seems to have bothered Devasagayam more than the Minister himself. Therefore, Devasagayam filed a petition in Criminal O. P. No. 15122 of 2021 in CC No. 24 of 2021 seeking a direction to the Investigating Officer to conduct a de novo investigation. 14. The grounds on which Devasagayam sought de novo investigation were quite strange. In his petition seeking de novo investigation, Devasagayam stated that though his specific complaint was against one Baskar and nine others, the Final Report filed under Section 173(8) included other persons, who, according to Devasagayam, had no connection with the case. Devasagayam also stated in his petition seeking de novo investigation that Baskar and Kesavan against whom he made a specific complaint, are not shown as accused.

In fact, the allegation made by Gopi in his petition before the High Court that Devasagayam had been won over by the accused, was not without substance, as can be seen from a few averments made by Devasagayam in his petition Criminal O. P. No. 15122 of 2021. For instance, in paragraph 7 of his petition seeking de novo investigation, he stated as follows: "It is crystal clear that the Petitioner and his son has made a specific complaint against one Baskar and Kesavan. The fictitious persons namely Baskar and Kesavan was arrayed as Accused No. 1 and 2. ... " 15. It is not known whether Devasagayam was referring to the persons against whom he made a specific complaint as fictitious persons or whether he was calling the Minister and the person alleged to be his Secretary, named as accused in the Final Report as fictitious persons. 16.

In paragraph 9 of his petition seeking de novo investigation, Devasagayam even relied upon a judicial precedent and contended in paragraph 10 that the Final Report under Section 173(8) had been filed without issuing notice to him and that the charges contained in the Report against the other accused are irrelevant to the facts of his own case. Paragraphs 28 to 30 of Devasagayam's petition seeking de novo investigation show that he had gone to the extent of pleading the case of the main culprits. These paragraphs read as follows: "28. The gross violation and the irregularity in concluding the final report, with all the above it is pertinent to state that the final report did not warrant any commission of offence against anybody and the crime registered is motivated. A Court proceeding ought not to be permitted to degenerate into a weapon of harassment of prosecution. 29.

The allegations made in the Final report 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, but may escape from the clutches of law. 30. The present criminal proceeding is manifestly attended with mala fide and/or 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. " 17. It appears that Devasagayam, originally seems to have had a genuine grievance against the culprits at the bottom of the Y. BALAJI v. KARTHIK DESARI & ANR. ETC. [V. RAMASUBRAMANIAN, J. ] layer, but he later turned out to be a Trojan horse, willing to sabotage the investigation against influential persons. This fact is borne out more by his pleadings in paragraph 31 of the petition in Criminal O. P. No. 15122 of 2021. The relevant portion of paragraph 31 reads as follows: "31.

... Where criminal proceedings are initiated based on illicit material collected on search and arrest which are per se illegal and vitiate not only a conviction and sentence based on such material but also the trial itself, the proceedings cannot be allowed to go on as it cannot but amount to abuse of the process of the court; in such a case not quashing the proceedings would perpetuate abuse of the process of the court resulting in great hardship and injustice to the accused. In our opinion, exercise of power under section 482 Cr. P. C. to quash proceedings in a case like the one on hand, would indeed secure the ends of justice. " 18. It is seen from the above averment of Devasagayam, that he was virtually pleading the case of the accused and seeking de novo investigation. But alas, Devasagayam was not the only one to be blamed. He had a silent partner in the prosecution which we shall see now.

If Devasagayam leapfrogged several miles to protect the actual culprits, the High Court seems to have gone one step further by ordering de novo investigation on a point not canvassed in the petition filed by Devasagayam. In fact, in the main paragraph 21 of the impugned order of the High Court dated 31. 10. 2022, the High Court has discussed elaborately the contentions advanced on behalf of Devasagayam in support of his plea for de novo investigation. These contentions were in sync with the averments contained in his petition in Criminal O. P. No. 15122 of 2021. 19. Though the original petition and the arguments recorded in paragraph 21 of the impugned order do not reflect one particular ground, the operative portion of the impugned order allows de novo investigation on a ground not raised in the petition.

In paragraph 55 of the impugned order, it was recorded by the High Court that as per the affidavit filed by the Investigating Officer, the investigating agency had seized the register used for entering interview marks and sent the same to the Forensic Department for analysis to find out the manipulations and that the Final Report under Section 173(8) of the Code was filed even before the receipt of the report of the Forensic Department. It is on this contention that the High Court thought fit to order de novo investigation not only in the case in which Devasagayam sought de novo investigation but also in all the criminal cases. What is interesting is that the order directing de novo investigation in all the three cases, has actually inured to the benefit of the accused, but the High Court put it on the ground that the credibility of the investigation should not be eroded.

In fact, the accused did not seek de novo investigation on the ground of slackness on the part of the Investigating Officer, but it was Devasagayam who sought it, with the able assistance of the Investigating Officer. 20. The fact that Devasagayam's petition was intended to help the accused is also borne out by one more fact. His original complaint dated 29. 10. 2015 which led to the registration of FIR in Crime No. 441 of 2015 was against ten persons and the offences registered therein were only under Sections 406 and 420 read with Section 34 IPC. On this complaint, a Final Report was filed under Section 173(2) of the Code on 13. 06. 2017 and this resulted in the registration of Calendar Case in CC No. 3627 of 2017. Devasagayam was happy with the fact that the Report filed under Section 173(2) did not include the offences under the PC Act.

Devasagayam was not bothered at that time about the fact that the register for entering the interview marks, sent to the Forensic Department had not been received. Suddenly, he became worked upafter the filing of the Report under Section 173(8) leading to the registration of Calendar Case No. 24 of 2021 including the offences under the PC Act. 21. What is shocking is that the High Court directed reinvestigation to be started ab initio, wiping out the earlier investigation altogether. One saving grace in this case is that even the learned senior counsel appearing for Devasagayam and the learned senior counsel appearing for the accused could not support the operative portion of the impugned order dated 31. 10. 2022, in Criminal O. P. No. 15122 of 2021. Paragraphs 79 to 81 of the impugned order dated 31. 10. 2022, needs to be extracted. They read as follows: "79.

Therefore, I am of the view that reinvestigation to be started ab-initio wiping out the earlier investigation altogether and to collect fresh evidence and material in the above criminal cases. Hence, I allowed the Crl. O. P. No. 15122 of2021 in C. C. No. 24 of 2021 for de-novo investigation along with C. C. No. 19 of 2021. Y. BALAJI v. KARTHIK DESARI & ANR. ETC. [V. RAMASUBRAMANIAN, J. ] 80. Therefore, it is directed the investigation should be conducted ab-initio comprehensively without reference to the earlier investigation on record covering all the aspects in relation C. C. No. 19 of 2020 and C. C. No. 24 of 2021 including whether the offence under Prevention of Corruption Act, 1988 are made out against the accused. The special Court before which C. C. No. 19 of 2020 and C. C. No. 24 of 2021 are pending will be at liberty to exercise power under Section 216 Cr. P. C, if there is any reluctance on the part of the State/investigating Officer. 81.

Further, on completion of investigation, if the investigating agency makes out a case for cognizance of offence against the accused then the investigating agency of the predicate offence shall provide the relevant materials/documents to the Directorate of Enforcement so as to enable it to invoke its jurisdiction to commence its enquiry under the P. M. L. A Act thereafter. " 22. By issuing the aforesaid direction, the High Court not only directed the wiping out of the investigation carried out so far, but virtually wiped out even the judgment of this Court dated 08. 09. 2022 passed in Criminal Appeal Nos. 1514-1516 of 2022. Hail judicial discipline! 23. Shri Kapil Sibal, learned senior counsel appearing for the accused and Shri Siddharth Aggarwal, learned senior counsel for Devasagayam, contended before us that the problem reflected in paragraphs 79 to 81 of the impugned order is one of language and not of law.

According to them, the expression "wiped out" had been used out of context and that what was sought to be removed by the High Court was only the conclusions reached by the Investigating Officer on the basis of the materials already collected. In other words, their contention was that the investigation so far made and the materials so far collected can never be thrown into the dustbin but that the conclusions reached by the Investigating Officer on the basis of those materials alone required to be wiped out. 24. It is true that English is not our mother tongue. It is also true that some allowance (or discount ranging from 0 to 90%) can be given at times to the use of certain loose expressions. But the expressions used in paragraphs 79 to 81 of the impugned order do not reflect a mere deficiency in language or law, but something more.

As rightly pointed out by Shri Gopal Sankaranarayanan, learned senior counsel, the High Court has used in the impugned order, several words and expressions such as, (i) reinvestigation to be started ab initio, (ii) wiping out the earlier investigation altogether; (iii) collect fresh evidence and material; and (iv) without reference to the earlier investigation on record. 25. Apart from the usage of the above words and phrases, which in our opinion, not merely opened up a small loophole in the law but opened up a huge black hole in the galaxy, the High Court issued one more direction in paragraph 80. This direction is to the investigating agency to find out whether the offences under the PC Act are made out against the accused or not. Such a direction stares at what this Court has said in paragraph 45 of the decision dated 08. 09. 2022 in Criminal Appeal Nos. 1514-1516 of 2022.

This Court has said "We are constrained to say that even a novice in Criminal Law would not have left the offences under the PC Act, out of the final report. " Ignoring the said opinion of this Court, the High Court has directed the Investigating Officer to find out afresh whether the offences under the PC Act are made out or not. Therefore, the problem with the impugned order is not merely one of improper usage of language, as sought to be diluted by the learned senior counsel for the accused and the complainant, but something more. 26. Even while supporting the impugned order, the learned senior counsel for the accused and the learned senior counsel for Devasagayam, requested us to read down paragraphs 79 to 81 of the impugned order and go by its intent. But it is easier said than done since we have had precedents of this Court reading down statutes but never one of reading down a judgment.

In view of the stand so taken even by the counsel for the accused and counsel for Devasagayam, it may not be strictly necessary to deal with the law relating to de novo investigation. Yet we would make a useful reference to the decision in Vinay Tyagi vs. Irshad Ali alias Deepak6. 27. Vinay Tyagi (supra) arose out of certain peculiar facts. The Special Cell of Delhi Police registered a First Information Report against two persons under some provisions of the Explosive Substances Act, 1908, a few provisions of the IPC and Section 25 of the Arms Act. The accused filed a petition in the High Court of Delhi seeking a transfer of investigation to CBI on the ground that they were working as Informers 6 (2013) 5 SCC 762 Y. BALAJI v. KARTHIK DESARI & ANR. ETC. [V. RAMASUBRAMANIAN, J. ] for the Intelligence Agencies and that they have been falsely implicated. Though the High Court entertained the petition, no stay was granted.

Therefore, the Special Cell of Delhi Police proceeded with the investigation and filed a charge-sheet. Thereafter, the High Court passed an order directing the CBI to undertake an inquiry and submit a report to the Court. Accordingly, CBI undertook an inquiry and filed a report stating that the investigation carried out by Delhi Police did not inspire confidence and that further investigation was needed. Thereafter, CBI filed a closure report. On the basis of the same, the accused sought discharge. Since discharge was not ordered, they approached the High Court, but the High Court remanded the matter back to the Sessions Court. It is the said order of remand that was challenged by the Investigating Officer before this Court. This Court framed two questions as arising for consideration in Vinay Tyagi. They read as follows:- "Question 1 1. 1.

Whether in exercise of its powers under Section 173 of the Code of Criminal Procedure, 1973 (for short "the Code"), the trial court has the jurisdiction to ignore any one of the reports, where there are two reports by the same or different investigating agencies in furtherance of the orders of a court? If so, to what effect? Question 2 1. 2. Whether the Central Bureau of Investigation (for short "CBI") is empowered to conduct "fresh"/ "reinvestigation" when the cognizance has already been taken by the court of competent jurisdiction on the basis of a police report under Section 173 of the Code? " 28. While dealing with the First Question, this Court pointed out that investigation can be of three kinds namely, (i) initial investigation; (ii) further investigation; and (iii) fresh or de novo or reinvestigation.

After exploring the meaning of "initial investigation" in paragraph 21 and the meaning of "further investigation" in paragraph 22, this Court recorded in paragraph 23, what a fresh investigation/reinvestigation/de novo investigation is and the circumstances under which the same can be ordered. Paragraph 23 of the decision reads as follows:- "23. However, in the case of a "fresh investigation", "reinvestigation" or "de novo investigation" there has to be a definite order of the court. The order of the court unambiguously should state as to whether the previous investigation, for reasons to be recorded, is incapable of being acted upon. Neither the investigating agency nor the Magistrate has any power to order or conduct "fresh investigation". This is primarily for the reason that it would be opposed to the scheme of the Code.

It is essential that even an order of "fresh"/"de novo" investigation passed by the higher judiciary should always be coupled with a specific direction as to the fate of the investigation already conducted. The cases where such direction can be issued are few and far between. This is based upon a fundamental principle of our criminal jurisprudence which is that it is the right of a suspect or an accused to have a just and fair investigation and trial. This principle flows from the constitutional mandate contained in Articles 21 and 22 of the Constitution of India. Where the investigation ex facie is unfair, tainted, mala fide and smacks of foul play, the courts would set aside such an investigation and direct fresh or de novo investigation and, if necessary, even by another independent investigating agency. As already noticed, this is a power of wide plenitude and, therefore, has to be exercised sparingly. The principle of the rarest of rare cases would squarely apply to such cases.

Unless the unfairness of the investigation is such that it pricks the judicial conscience of the court, the court should be reluctant to interfere in such matters to the extent of quashing an investigation and directing a "fresh investigation". 29. In paragraphs 43 and 45, this Court held that the power to order de novo investigation vests only with superior courts and that the same has to be exercised sparingly in exceptional cases. In paragraph 46, this Court pointed out that while ordering de novo investigation, there are two options open to the superior court namely, (i) to direct the report already prepared or the investigation so far conducted, not to form part of the records of the case; or (ii) to direct the report already prepared or the investigation so far conducted to form part of the record. If the superior court is silent on this aspect, the report already prepared or the investigation so far conducted will form part of the record.

In other words, if the superior court intended that the investigation so far conducted and the report already filed should not form part of the record, it should specifically say so. 30. In the order impugned in these appeals, the High Court has indicated by using four different expressions and phrases that the investigation so far conducted shall not form part of the record. But Y. BALAJI v. KARTHIK DESARI & ANR. ETC. [V. RAMASUBRAMANIAN, J. ] even according to the learned senior counsel for Devasagayam and learned senior counsel for the accused, the operative portion of the impugned order of the High Court need not be understood in such a manner. If that is so, all those phrases and expressions deserve to be removed. If they are removed, the life gets ebbed out of the impugned order, which in our opinion, it richly deserves. 31.

Before we wind up our discussion in Part-I, it may be necessary to deal with a few preliminary objections raised on behalf of the accused to the very maintainability of these appeals. The question of maintainability is raised on the basis of the status of the parties. Therefore, it is essential to take stock of the status of parties who have filed appeals against the order of the Madras High Court for de novo investigation. For easy appreciation, the status of parties who are the appellants in the appeals arising out of the order for de novo investigation and a brief indication of who they are, are presented in a tabular column as follows:- Civil Appeals arising out of Name of appellant Brief description of who he is and how he is Special Leave Petitions and aggrieved by the order of de novo Diary Numbers investigation SLP (Crl. ) Nos. 1207-1208 of Director, ED is aggrieved because any shadow