Supreme Court Upholds Appointment of CVC and VC: Common Cause vs. Union of India (2 July 2018)

LEGAL ISSUE: Whether the appointments of the Central Vigilance Commissioner (CVC) and Vigilance Commissioner (VC) were valid, considering allegations of lack of integrity and procedural lapses.

CASE TYPE: Public Interest Litigation (PIL) concerning appointments to statutory bodies.

Case Name: Common Cause (A Regd. Society) & Ors. vs. Union of India & Ors.

Judgment Date: 2 July 2018

Date of the Judgment: 2 July 2018

Citation: 2018 INSC 602

Judges: Arun Mishra, J. and Mohan M. Shantanagoudar, J.

Can allegations of impropriety against appointees to high public office invalidate their appointments, even if a selection committee followed due process? The Supreme Court of India recently addressed this question in a Public Interest Litigation (PIL) challenging the appointments of the Central Vigilance Commissioner (CVC) and a Vigilance Commissioner (VC). The core issue revolved around whether the appointees met the standard of “impeccable integrity” as mandated by previous Supreme Court judgments and the Central Vigilance Commission Act, 2003. This case delves into the balance between procedural compliance and the substantive integrity of appointees to key anti-corruption bodies. The judgment was delivered by a two-judge bench comprising Justice Arun Mishra and Justice Mohan M. Shantanagoudar.

Case Background

The case originated from two writ petitions challenging the appointments of Mr. K.V. Chowdary as the Central Vigilance Commissioner (CVC) and Mr. T.M. Bhasin as a Vigilance Commissioner (VC). The petitioners, including Common Cause, a registered society, argued that these appointments were illegal and void due to violations of principles of impeccable and institutional integrity, as previously laid down by the Supreme Court. They contended that the appointees did not have an unblemished record of service, which was essential for heading the Central Vigilance Commission, India’s apex anti-corruption body.

The petitioners raised specific allegations against Mr. Chowdary, including his alleged meetings with the then CBI Director, Mr. Ranjit Sinha, who was himself under scrutiny for his conduct in other cases. They also alleged that Mr. Chowdary had shielded individuals in the “Stock Guru Scam,” under-assessed income of a company associated with Mr. Ponty Chadha, and failed to take action on illegal accounts in foreign countries. The petitioners also alleged that Mr. Bhasin had been indicted by the CVC for tampering with the appraisal report of a General Manager while serving as the CMD of Indian Bank.

The petitioners sought the quashing of the appointments and a direction for the Union of India to provide minimum years of experience in the field of vigilance for appointees to these positions. The respondents, including the Union of India and the appointees, defended the process and the appointments, asserting that due procedure was followed and that the allegations were unsubstantiated.

Timeline:

Course of Proceedings

The Supreme Court had permitted the Union of India to proceed with the appointments of CVC and VC, subject to the final decision on the writ petitions. The appointments were made, and the challenge was confined to the legality and validity of these appointments. The Court examined the process followed by the selection committee and the material placed before it, including complaints and inputs from various agencies.

Legal Framework

The appointments were made under the Central Vigilance Commission Act, 2003. Section 3(3) of the Act specifies that the CVC and VC shall be appointed from persons with knowledge and experience in vigilance, policy making, and administration, including police administration. The Act also provides for a Selection Committee comprising the Prime Minister, the Home Minister, and the Leader of the Opposition. The Supreme Court in Vineet Narain & Ors. v. Union of India & Anr. (1998) 1 SCC 226 had mandated statutory status for the Central Vigilance Commission. The court also referred to its judgment in Centre for PIL & Anr. v. Union of India & Anr. (2011) 4 SCC 1, which emphasized the need for impeccable integrity in appointees to such positions and the importance of a fair and transparent selection process.

The Court noted that the selection process must ensure that powers are exercised for the purpose and in the manner provided by the Act. The legality of the selection is subject to judicial review. All civil servants and other persons empanelled shall be outstanding and of impeccable integrity, based on rational criteria reflected by recording vigilance and/or notings akin to reasons. Complete information, whether favorable or adverse, has to be forwarded to the Selection Committee, and nothing material or relevant should be withheld.

Arguments

The petitioners argued that the appointments of Mr. Chowdary and Mr. Bhasin violated the principles of “impeccable integrity” and institutional integrity as laid down in Vineet Narain and Centre for PIL. They contended that Mr. Chowdary’s meetings with Mr. Ranjit Sinha, his alleged involvement in the Stock Guru scam, and his role in under-assessing income of a company associated with Mr. Ponty Chadha, made him unsuitable for the position of CVC. They also argued that Mr. Chowdary did not actively investigate foreign accounts in HSBC Bank, Geneva, and failed to take action on the Radia Tapes.

Regarding Mr. Bhasin, the petitioners argued that he was indicted in a CVC inquiry for tampering with the appraisal report of Mr. Malay Mukherjee, making him unfit to hold the office of Vigilance Commissioner. They also contended that the selection process lacked transparency and did not allow for public inputs.

The respondents, on the other hand, argued that due procedure was followed, and all relevant material was placed before the selection committee. They submitted that the committee had considered all allegations and inputs from various agencies and found the appointees to be eligible. They also argued that the allegations were unsubstantiated and motivated by personal vendetta.

Issues Framed by the Supreme Court

The Supreme Court framed the following issues for consideration:

1. Whether the appointments of Mr. K.V. Chowdary as CVC and Mr. T.M. Bhasin as VC were in violation of the principles of “impeccable integrity” and institutional integrity.
2. Whether the selection process followed by the High Power Committee was fair, transparent, and in accordance with the Central Vigilance Commission Act, 2003, and previous Supreme Court judgments.

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 authorities:

Judgment

The Supreme Court held that the appointments of Mr. K.V. Chowdary as CVC and Mr. T.M. Bhasin as VC were valid. The court found that the selection process followed by the High Power Committee (HPC) was fair, transparent, and in accordance with the Central Vigilance Commission Act, 2003, and previous Supreme Court judgments.

The court emphasized that the selection committee had considered all the allegations and inputs from various agencies, including the CBI and the Intelligence Bureau, and found the appointees to be eligible. The court also noted that the selection process was transparent and followed due procedure.

The court observed that the Central Vigilance Commission is an integrity institution and that its competency is to be ensured by the Government, as well as its integrity. The court also noted that the personal integrity of an individual also becomes relevant as it has a correlation with the institution’s integrity.

The court also observed that “…judicial determination is confined to the integrity of the decision-making process undertaken by the HPC in terms of the proviso to Section 4(1) of the 2003 Act.” The court reiterated the difference between judicial review and merit review, stating that “Government is not accountable to the courts for the choice made but Government is accountable to the courts in respect of the lawfulness/legality of its decisions when impugned under the judicial review jurisdiction.”

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the fact that the High Power Committee (HPC) had meticulously followed the due process in the appointment of the CVC and VC. The court emphasized that all allegations and inputs from various agencies, including the CBI and Intelligence Bureau, were considered by the HPC. The court also noted that there was no evidence to suggest any mala fide intent or procedural lapses in the selection process.

The Court also emphasized that it could not sit in appeal over the choice of the appointees unless there was a clear violation of law or procedure. The Court’s reasoning was also influenced by the fact that the allegations were not substantiated by any concrete evidence.

Logical Reasoning

The court rejected the arguments for alternative interpretations, stating that there was no evidence of impropriety or mala fide intent. The final decision was reached after a thorough examination of the facts and the law.

The court also quoted from its previous judgment in Centre for PIL, stating that “…judicial review is concerned with whether the incumbent possessed qualifications for the appointment and the manner in which the appointment came to be made or whether procedure adopted was fair, just and reasonable.”

The Court also stated that “Government is not accountable to the courts for the choice made but Government is accountable to the courts in respect of the lawfulness/legality of its decisions when impugned under the judicial review jurisdiction.”

The court concluded that there was no ground to quash the appointments, as the selection process was followed and the allegations were not substantiated.

The court quoted the following from the judgment:

“The Central Vigilance Commission is one of the integrity institutions. It was set up in 1964…and its function is to improve the vigilance administration of the country and to have anti-corruption measures.”

“That judicial determination is confined to the integrity of the decision-making process by the HPC…If the decision is influenced by extraneous considerations or selection is made in breach of the statute or rules, it can be set aside.”

“We are nowadays in the scenario that such complaints cannot be taken on face value. Even against very honest persons, allegations can be made.”

There were no majority or minority opinions in this case. Both judges concurred on the decision.

Key Takeaways

✓ Appointments to high public offices, particularly those related to anti-corruption, must adhere to the principles of transparency, fairness, and impeccable integrity.

✓ The selection process must be free from extraneous considerations and must comply with the relevant statutes and rules.

✓ While allegations of impropriety can be raised, they must be substantiated by concrete evidence to warrant judicial intervention.

✓ The judiciary’s role is to review the decision-making process and not to sit in appeal over the choices made by the appointing authority.

This judgment has significant implications for the appointment of individuals to key anti-corruption bodies. It clarifies the balance between procedural compliance and the substantive integrity of appointees. The judgment also highlights the importance of a transparent and fair selection process and the need for concrete evidence to challenge such appointments.

Directions

No specific directions were given by the Supreme Court in this case.

Development of Law

The ratio decidendi of this case is that the appointment of a CVC and VC can only be quashed if there is a violation of the procedure or if there is a lack of integrity. The court also held that unsubstantiated allegations cannot be the basis for quashing the appointment. There is no change in the previous position of law.

Conclusion

In conclusion, the Supreme Court upheld the appointments of Mr. K.V. Chowdary as CVC and Mr. T.M. Bhasin as VC, finding no merit in the allegations of impropriety and procedural lapses. The Court emphasized the importance of following due process and the need for concrete evidence to challenge such appointments. The judgment reinforces the balance between procedural compliance and the substantive integrity of appointees to key anti-corruption bodies.