Supreme Court quashes charges against Executive Engineer in Jharkhand corruption case: Pushpendra Kumar Sinha vs. State of Jharkhand (2022) INSC 717 (24 August 2022)

Date of the Judgment: 24 August 2022
Citation: (2022) INSC 717
Judges: N.V. Ramana, CJI, J.K. Maheshwari, J., Hima Kohli, J.
Can an individual be held culpable for actions taken in accordance with the advice of the Advocate General and decisions of a board, merely because they prepared a note for seeking instructions? The Supreme Court of India addressed this question in a case concerning alleged corruption in the Jharkhand State Electricity Board (JSEB). The Court quashed criminal charges against an Executive Engineer, emphasizing that he was not part of the decision-making process and acted on the instructions of his superiors and the advice of the Advocate General. The judgment was delivered by a three-judge bench comprising Chief Justice N.V. Ramana, Justice J.K. Maheshwari, and Justice Hima Kohli, with the majority opinion authored by Justice J.K. Maheshwari.

Case Background

The case revolves around Pushpendra Kumar Sinha, an Executive Engineer (Electrical) in the Accelerated Power Development Reforms Program (APDRP) Wing of the Jharkhand State Electricity Board (JSEB) since December 7, 2004. During his tenure, Ramjee Power Construction Limited (RPCL) was awarded a contract on January 27, 2005. Due to delays, the then Chairman of JSEB, Mr. Shivendu, instructed the Chief Engineer (CE), Mr. R.P. Agarwal, on December 21, 2006, to propose the termination of RPCL’s contract at the next board meeting. However, before the meeting, a new Chairman, Mr. V.N. Pandey, was appointed on January 4, 2007. He convened a meeting on February 6-7, 2007, where it was agreed that RPCL would complete the work by July 2007. RPCL then invoked the arbitration clause on December 22, 2006, and requested JSEB to appoint an arbitrator. The letters were handed over to the Appellant, who prepared a note on June 8, 2007, seeking instructions on the appointment of an arbitrator and waiver of penalty, based on the advice of the Advocate General (AG) of Jharkhand in similar projects.

Timeline

Course of Proceedings

The Special Judge, Anti-Corruption Bureau, dismissed the Appellant’s discharge application under Section 239 of the Code of Criminal Procedure (Cr.P.C.) on July 4, 2018, stating sufficient material existed for framing charges. The High Court of Jharkhand at Ranchi affirmed this order on January 6, 2020, influenced by the fact that the previous JSEB Chairman had instructed to terminate RPCL’s contract. The High Court noted that the Appellant had proposed arbitration without mentioning the previous Chairman’s instructions and had proposed an agenda for wrongful implementation of the award. Aggrieved by this, the Appellant approached the Supreme Court.

Legal Framework

The case involves several sections of the Indian Penal Code (IPC) and the Prevention of Corruption Act, 1988 (PC Act). The relevant provisions are:

• Section 109 of the IPC: Deals with abetment of any offence.
• Section 409 of the IPC: Addresses criminal breach of trust by a public servant, or by a banker, merchant or agent.
• Section 420 of the IPC: Concerns cheating and dishonestly inducing delivery of property.
• Section 467 of the IPC: Relates to forgery of valuable security, will, etc.
• Section 471 of the IPC: Deals with using as genuine a forged document or electronic record.
• Section 477A of the IPC: Addresses falsification of accounts.
• Section 120B of the IPC: Pertains to criminal conspiracy.
• Section 13(1)(c) of the PC Act: Addresses criminal misconduct by a public servant by corrupt or illegal means or by abusing his position.
• Section 13(1)(d) of the PC Act: Addresses criminal misconduct by a public servant by obtaining for himself or for any other person any valuable thing or pecuniary advantage.
• Section 13(2) of the PC Act: Specifies the punishment for the offences under Section 13(1).
• Section 239 of the Cr.P.C.: Relates to the procedure for discharge of the accused.
• Section 397 of the Cr.P.C.: Addresses the calling for records to exercise powers of revision.
• Section 401 of the Cr.P.C.: Addresses the High Court’s powers of revision.

Arguments

Appellant’s Submissions:

• The Appellant, as an Executive Engineer, lacked the decision-making power or financial authority to execute the contract or the arbitral award. His role was limited to following instructions from superiors.
• There was no concealment of the previous Chairman’s instruction to terminate the contract. The Appellant’s note dated June 8, 2007, was on the next page of the Chief Engineer’s noting, and the instructions were known to all.
• The prosecution concealed that the verbal instruction for termination was overturned by the new Chairman in a meeting on February 6-7, 2007, where the Appellant was not present.
• The Appellant’s note was based on facts and documents endorsed to him by his controlling officer.
• The Appellant was wrongly prosecuted for actions from granting time to complete the work, to referring to arbitration, and for implementing the interim award. He was not part of the decision-making process.
• There were no allegations of illegal gratification, undue benefit, or disproportionate assets against the Appellant.
• The prosecution failed to establish any nexus between the Appellant and RPCL.
• The High Court had previously observed that the Appellant had put up the matter before higher authorities for instructions and did not act unilaterally.
• Except for the Director of Finance, none of the decision-making authorities were made accused in the case.

Respondent’s Submissions:

• The State argued in support of the concurrent findings of the lower courts.
• The State contended that the factual arguments of the defense cannot be raised at this stage.
• The State argued that at the stage of framing of charge, the scope of interference is limited, and the Court is not required to see whether there are sufficient grounds for conviction. The Court has to only see the material collected during investigation and on consideration of the same, a prima facie case is made out or not.

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame specific issues in a dedicated section. However, the core issue addressed by the Court was:

• Whether the Appellant, an Executive Engineer, could be held culpable for offences under the IPC and PC Act, based on his actions of preparing a note seeking instructions for appointment of an arbitrator and waiver of penalty, when he was not part of the decision-making process and acted on the advice of the Advocate General and decisions of the JSEB board.

The Court also implicitly dealt with the sub-issue:

• Whether the High Court was correct in upholding the order of the Special Judge dismissing the discharge petition of the Appellant.

Treatment of the Issue by the Court

The following table demonstrates as to how the Court decided the issues

Authorities

The Supreme Court relied on the following authority:

• Union of India vs. Prafulla Kumar Samal, (1979) 3 SCC 4 – Supreme Court of India: This case was cited regarding the principles to be followed while framing of charges, emphasizing that the court must apply its judicial mind on the material placed on record and must be satisfied that the commission of offence by the accused was possible.

Judgment

How each authority was viewed by the Court?

• Union of India vs. Prafulla Kumar Samal, (1979) 3 SCC 4*: The Supreme Court referred to this judgment to highlight that the court must apply its judicial mind on the material placed on record and must be satisfied that the commission of offence by the accused was possible, while framing charges.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the fact that the Appellant, an Executive Engineer, did not have decision-making powers and was merely following the instructions of his superiors and the advice of the Advocate General. The Court emphasized that the Appellant was not part of the decision-making process regarding the extension of the contract, the appointment of an arbitrator, or the implementation of the arbitral award. The Court also noted the absence of any evidence of illegal gratification or disproportionate assets against the Appellant. The fact that senior officials involved in the decision-making process were not made accused also weighed heavily in the Court’s decision.

Fact:Law Ratio

Logical Reasoning

The Court considered the alternative interpretation that the Appellant was part of a conspiracy to benefit RPCL. However, this interpretation was rejected due to the lack of evidence linking the Appellant to any such conspiracy. The Court found that the Appellant’s actions were consistent with his duties as an Executive Engineer and that he had acted on the instructions of his superiors and the advice of the Advocate General.

The Supreme Court held that the High Court had erred in refusing to exercise its revisional powers under Sections 397 and 401 of the Cr.P.C. The Court found that the ingredients of the alleged offences were not prima facie made out against the Appellant. The Court emphasized that the Appellant was not entrusted with the funds of JSEB, nor did he fraudulently or dishonestly deceive senior officials. The Court also noted the absence of any evidence of illegal gratification or disproportionate assets against the Appellant. The Court ultimately concluded that the Appellant was wrongly implicated and discharged him from the criminal proceedings.

The Court quoted the following from the judgment:

• “M/s RPCL agreed that they will apply their full efforts to complete the project so that it may be completed within extended completion period i.e. July’ 07 instead of going for Arbitration/Court of Law.”
• “We fail to understand as to why the same person, who had approved the implementation of award as a member of the Board, had later as Vigilance Commissioner, recommended initiation of prosecution against the Appellant, who had merely prepared the agenda for appointment of an arbitrator and had nothing to do with the approval of the award and payment of money.”
• “In our considered view, prima facie there is nothing which affixes culpability or constitutes commission of offence including mens rea on the part of the Appellant.”

There was no minority opinion in this case. The judgment was unanimous, with all three judges agreeing on the outcome and reasoning.

The Supreme Court’s decision has significant implications for future cases involving allegations of corruption against public servants. It clarifies that mere procedural actions taken by a subordinate officer, without any decision-making authority or evidence of malfeasance, cannot be grounds for criminal prosecution. The judgment also underscores the importance of examining the role of senior officials in decision-making processes and the need for a thorough investigation before implicating individuals in criminal proceedings.

The judgment does not introduce any new doctrines or legal principles but reinforces the existing principles of criminal law and the importance of establishing a prima facie case before framing charges against an accused.

Key Takeaways

• Public servants cannot be held liable for actions taken in compliance with instructions from their superiors or on the advice of legal authorities, unless there is evidence of malfeasance or criminal intent.
• Subordinate officers cannot be held responsible for decisions made by higher authorities, especially when they are not part of the decision-making process.
• A thorough investigation is necessary to identify the key decision-makers and to establish a prima facie case before implicating individuals in criminal proceedings.
• The absence of evidence of illegal gratification or disproportionate assets is a significant factor in determining the culpability of an accused.
• The courts must apply their judicial mind and consider the broad probabilities of the case before framing charges against an accused.

Directions

The Supreme Court directed the discharge of the Appellant in the criminal proceedings arising out of Special Case No. 02 of 2011.

Development of Law

The ratio decidendi of this case is that an individual cannot be held liable for actions taken in compliance with instructions from superiors or on the advice of legal authorities, unless there is evidence of malfeasance or criminal intent. This judgment reinforces the principle that mere procedural actions by a subordinate officer, without decision-making authority or evidence of malfeasance, cannot be grounds for criminal prosecution. There is no change in the previous position of law, but the judgment clarifies the application of these principles in the context of corruption cases.

Conclusion

The Supreme Court’s judgment in the case of Pushpendra Kumar Sinha vs. State of Jharkhand provides clarity on the culpability of public servants in corruption cases. The Court quashed the charges against the Executive Engineer, emphasizing that he was not part of the decision-making process and had acted on the instructions of his superiors and the advice of the Advocate General. This judgment underscores the importance of a thorough investigation and the need to establish a prima facie case before framing charges against an accused. It also serves as a reminder that subordinate officers cannot be held responsible for decisions made by higher authorities, especially when they are not part of the decision-making process.