REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL ORIGINAL JURISDICTION
IA NO. OF 2012
IN
WRIT PETITION (CIVIL) NO. 562 OF 2009
Samaj Parivartan Samudaya & Ors. … Petitioners
Versus
State of Karnataka & Ors. … Respondents
O R D E R
Swatanter Kumar, J.
1. By this order we will deal with and dispose of, the recommendations
made by the Central Empowered Committee (for short, ‘CEC’) in its report
dated 20th April, 2012. Since we have heard the affected parties, the
petitioners and the learned Amicus Curiae, we shall summarize the
contentions of the learned counsel for the respective parties. The learned
counsel appearing for the affected parties contended:
a. CEC has submitted its report without providing them an opportunity of
being heard.
b. CEC has exceeded its jurisdiction and enlarged the scope of the enquiry
beyond the reference made by the Court. Thus, the Court should not
accept any of the recommendations made by the CEC.
c. In relation to the alleged irregularities and illegalities pointed out
in the report of the CEC, even where criminality is involved or criminal
offences are suspected, the matters are sub judice before the Court of
competent jurisdiction. Thus, this Court should not pass any orders for
transferring the investigation of such offences to the Central Bureau of
Investigation (for short ‘CBI’) as it would seriously prejudice their
interests.
2. In order to deal with these contentions, it is necessary for this
Court to briefly refer to the background of these cases, which has resulted
in the filing of the unnumbered IA in Writ Petition No. 562/2009 and the
peculiar facts and circumstances in which the CEC has made its
recommendations.
3. Concerned with the rampant pilferage and illegal extraction of
natural wealth and resources, particularly iron ore, and the environmental
degradation and disaster that may result from unchecked intrusion into the
forest areas, this Court felt compelled to intervene. Vide its order dated
9th September, 2002 in T.N. Godavarman Thirumalpad v. Union of India & Ors.
[W.P.(C) No. 202 of 1995], this Court constituted the CEC to examine and
monitor the various activities infringing the laws protecting the
environment and also the preventive or punitive steps that may be required
to be taken to protect the environment. In addition to this general
concern for the environment, the order of this Court dated 9th September,
2002, this Court noted violations of its Orders and directed that the CEC
shall monitor implementation of all orders of the Court and shall place
before it any unresolved cases of non-compliance, including in respect of
the encroachments, removals, implementations of working plans, compensatory
afforestation, plantations and other conservation issues. In furtherance
to the said order, the Government framed a notification in terms of Section
33 of the Environment Protection Act, 1996. The CEC constituted by this
Court was proposed to be converted into a Statutory Committee. The draft
notification for the same was also placed before this Court on 9th
September, 2002. After approval, the Court directed that a formal
notification will be issued within a week and the functions and
responsibilities given to the CEC were to be exercised by the said
Statutory Committee. In fact, this Notification was issued on 17th
September, 2002.
4. It may be noticed here that, it was in furtherance to the order of
the Government of Andhra Pradesh vide G.O.M No. 467, Home (SCA) Dept. dated
17th November, 2009, supplemented by Notification No. 228/61/2009-AVD-11
dated 1st December, 2009 issued by the Central Government, that the CBI was
directed to register a case against the Obulapuram Mining Company (OMC).
Earlier the CBI had registered a case against the OMC on 7th December, 2009
and started the probe. This probably came to be stayed by the High Court
vide its order dated 12th December, 2009 which stay was vacated by another
order of that Court on 16th December, 2010 paving the way for a full-
fledged probe. As a result of vacation of the stay, the CBI continued its
investigation.
5. The CBI also filed a charge-sheet in a special court against the OMC,
in an illegal mining case falling within the State of Karnataka, charging
the accused under Sections 120B, 409, 420, 468 and Section 471 of the
Indian Penal Code, 1860 (for short ‘IPC’) read with the provisions of the
Prevention of Corruption Act, 1988. The case against the OMC for illegal
mining was under investigation in respect of the areas of Obulapuram and
Malangapudi villages of Anantpur district in the State of Andhra Pradesh
and in the rest of the State of Andhra Pradesh.
6. Further, the State of Andhra Pradesh vide its G.O. Rt. No. 723 dated
25th November, 2009, issued by the Industrial and Commercial Department,
suspended the mining operations and also the transportation of mineral
material by OMC and even other implicated companies, on the basis of the
findings of a High Level Committee, headed by the Principal Chief
Conservator of Forests, Hyderabad and the Report of the CEC submitted to
this Court in I.A. No. 2/2009 in Writ Petition (Civil) No. 201 of 2009, a
copy of which was forwarded to the State Government. This was challenged
before the High Court of Andhra Pradesh which, vide judgment dated 26th
February, 2010, set aside the notification and allowed the writ petitions,
while holding that the G.O. issued by the Government suffered from a
jurisdictional error and was in violation of the principles of natural
justice. Against the said judgment of the High Court, the Government of
Andhra Pradesh filed a Special Leave Petition, SLP(C) No. 7366-7367 of 2010
on different grounds.
7. Samaj Parivartan Samuday, a registered society, filed petition under
Article 32 of the Constitution of India stating that the illegal mining in
the States of Andhra Pradesh and Karnataka was still going on in full
swing. Such illegal mining and transportation of illegally mined minerals
were being done in connivance with the officials, politicians and even
Ministers of State. There was a complete lack of action on the part of the
Ministry of Environment and Forests on the one hand and the States of
Andhra Pradesh and Karnataka, on the other. It was averred that there was
complete breakdown of the official machinery, thereby allowing such blatant
illegalities to take place. This inaction and callousness on the part of
the Central and the State Governments and failure on their part to control
the illegal mining has allowed large-scale destruction, both of forest and
non-forest lands and has adversely affected the livelihood of the people.
It thus, has filed WP (C) 562 of 2009 and has prayed for issuance of a writ
of mandamus or any other appropriate writ, order or direction to the
respective State Governments and to the Union of India, to stop all mining
and related activities in the forest areas of these two States. It further
sought that the orders passed by this Court in the W.P.(C) No. 202 of 1995
be carried out and the provisions of the Forest Conservation Act, 1980 be
implemented. It also prayed for cancelling of the ‘raising contracts’ or
sub-lease executed by the Government of Karnataka in favour of the various
private individuals and allowing back-door entry into the mining activity
in those areas. The most significant prayer in this petition was that
after stopping of the mining activity, a systematic survey of both the
inter-state border between the States of Andhra Pradesh and Karnataka and
mine lease areas along the border be conducted and proper Relief and
Rehabilitation Programmes (for short ‘RR Programmes’) be implemented.
8. All the above cases, i.e., W.P.(C) No. 202/1995, 562/2009 and SLP(C)
No. 7366-7367/2010, relate to protection of environment, forest areas,
stoppage of illegal mining and cancellation of illegal sub-leasing and
contracts executed by any State Government in favour of the third parties,
to the extent such contracts are invalid and improper. The latter cases,
Writ Petition (Civil) No. 562 of 2009 and SLP(C) Nos. 7366-7367 of 2010
concern the Bellary Forest Reserve. Further, there were serious
allegations raised in these petitions as to how and the manner in which the
leases were executed and mining permits were granted or renewed for
carrying out the mining activities stated in the petition.
9. The CEC was required to submit quarterly reports, which it has been
submitting and with the passage of time, large irregularities and
illegalities coupled with criminality were brought to the notice of this
Court. The CEC, in discharge of its functions and responsibilities, was
examining the matters, in both the States of Andhra Pradesh and Karnataka.
These violations have come to the surface as a result of enquiries
conducted by the CEC, regarding illegal mining and mining beyond their
leased areas by these companies. It was pointed by the CEC with specific
reference to these companies that there was not only illegal extraction of
iron ore but the minerals was being also extracted beyond the leased area
specified in the lease deeds. Further, there was unchecked export of iron
ore from the border areas of the two States, Andhra Pradesh and Karnataka.
This related to the quantum, quality and transportation of ore as well.
10. While passing an order of complete ban on mining activity in these
areas vide order dated 29th July, 2011 this Court sought submissions on the
market requirement for mined ore and vide order dated 5th August, 2011
permitted only M/s. National Minerals Development Corporation Ltd. (for
short “NMDC”) to carry out very limited mining activity, so that the
economic interest of the country and of the states does not suffer
irretrievably. This Court has also directed the CEC to examine all
aspects of the mining activity and report on various measures that are
required to be taken for RR Programmes. Limited mining activity, thus,
was permitted to be carried on in the area with the clear direction that
the RR Programmes shall be simultaneously commenced and it is only after
such RR Programmes are satisfactorily put into motion and the CEC makes a
suggestion in this regard, that the mining activity would be permitted.
Vide order dated 23rd September, 2011, this Court accepted various
recommendations of the CEC and noticed that prima facie it appears that at
the relevant time, there existed linkage between the alleged illegal mining
in the Bellary Reserve Forest, falling in the District Anantpur in Andhra
Pradesh and the illegalities in respect of grant/renewal of mining leases
and deviations from sanctioned mine sketch in the Bellary District in
Karnataka. The Court also noted that illegally extracted iron ore
belonging to one M/s. Associated Mining Company (for short “AMC”) was
apparently routed through the nearest Port in Vishakhapatnam, through
district Anantpur in Andhra Pradesh. Thus, the Court felt that the CBI
should examine the alleged illegalities. Vide the same order, this Court
required the CBI to additionally present a status report of investigations
which the CBI had undertaken in respect of OMC in Andhra Pradesh under FIR
No. 17A/2009-CBI(Hyderabad). It was also reported that there was massive
illegal mining by third parties in the mining lease No. 1111 of one M/s.
National Minerals Development Corporation (NMDC). It was suspected that
one M/s. Deccan Mining Syndicate (for short “DMS”) was involved in such
activities and no action had been taken on the complaints of NMDC. Some
other directions were also issued including directions for further inquiry
by the CEC and the CEC was required to put up a comprehensive report before
this Court.
11. In the meanwhile, an application was filed by the petitioners of writ
petition No.562 of 2011 which remained un-numbered. The prayer in this
application was to extend the scope of investigation by the CBI relating to
illegal mining and other allied activities which the politicians and major
corporate groups including M/s. Jindal Group and M/s. Adanis were indulging
in, within the State of Karnataka. They also prayed that both the States
should also be directed demarcate the inter-state boundaries, particularly,
in the mining area.
12. After examining the issues raised in the IA, the earlier orders of
this Court and based on the meetings held by the CEC on 20th March, 2012
and 11th April, 2012, respectively, the CEC identified the issues as
follows:-
i) The alleged serious illegalities/ irregularities and undue
favour in respect of (a) the land purchased by the close
relatives of the then Chief Minister, Karnataka for 0.40
crore in the year 2006 and subsequently sold to M/s South
West Mining Limited in the year 2010 for Rs.20.00 crores
and (b) donation of Rs.20.00 crore received by Prerna
Education Society from M/s South West Mining Limited.
ii) the alleged illegal export of iron ore from Belekeri Port
and associated issues;
iii) alleged export from Krishapatnam and Chennai Port after
exports were banned by the State of Karnataka; and
iv) transfer of senior police officers on deputation to
Lokayukta, Karnataka.”
13. The CEC filed two comprehensive reports before this Court, one dated
20th April, 2012 and other dated 27th April, 2012, both in Writ Petition
(Civil) No. 562 of 2011.
14. Out of the above issues indicated, the CEC dealt with issue No. 1 in
the Report dated 20th April, 2012, while issue Nos. 2 to 4 were dealt with
in the Report dated 27th April, 2012. On issue No. 1, after summarizing
the facts and its observations during its enquiry, the CEC pointed out
illegalities, irregularities and instances of misuse of public office
committed for the benefit of the close relatives of the then Chief
Minister, State of Karnataka. It made the following recommendations :-
“15. Keeping in view the above facts and circumstances the CEC
is of the considered view that the purchase of the above said
land notified for acquisition for public purpose, its de-
notification from acquisition, permission granted for conversion
from agriculture to non-agricultural (residential) purpose and
subsequent sale to M/s South West Mining Limited prima facie
involves serious violations of the relevant Acts and procedural
lapses and prima facie misuse of office by the then Chief
Minister, Karnataka thereby enabling his close relatives to make
windfall profits and raises grave issues relating to undue
favour, ethics and morality. Considering the above and taking
into consideration the massive illegalities and illegal mining
which have been found to have taken place in Karnataka and the
allegations made against the Jindal Group as being receipient of
large quantities of illegally mined material and undue favour
being shown to them in respect of the mining lease of M/s MML it
is RECOMMENDED that a detailed investigation may be directed to
be carried out in the matter by an independent investigating
agency such as the Central Bureau of Investigation (CBI) and to
take follow up action. This agency may be asked to delve into
the matter in depth and in a time bound manner. This agency may
also be directed to investigate into other similar cases, if
any, of lands de-notified from acquisition by the Bangalore
Development Authority and the illegalities / irregularities /
procedural lapses, if any, and to take follow up action.
16. The Prerna Education Society set up by the close relatives
of the then Chief Minister, Karnataka has during March, 2010
vide two cheques of Rs.5.0 crores each received a donation of
Rs.10 crores from M/s South West Mining Limited, a Jindal Group
Company. In this context, it is of interest to note that during
the year 2009-2010 the net profit (after tax) of the said
Company was only Rs.5,73 crores. Looking into the details of
the other donations made by the said Company or by the other
Jindal Group Companies to any other Trust / Society not owned,
managed or controlled by the Jindal Group. After considering
that a number of allegations, with supporting documents, have
been made in the Report dated 27th July, 2011 of Karnataka
Lokayukta regarding the M/s. JSW Steel Limited having received
large quantities of illegal mineral and alleged undue favour
shown to it in respect of the extraction / supply of iron ore by
/ to it from the mining lease of M/s MML, it is RECOMMENDED that
this Hon’ble Court may consider directing the investigating
agency such as CBI to also look into the linkages, if any,
between the above said donation of Rs.10 crores made by M/s
South West Mining Limited and the alleged receipt of illegal
mineral by M/s JSW Steel Limited and the alleged undue favour
shown to it in respect of the mining lease of M/s MML.
17. The CEC has filed its Report dated 28th March, 2012
wherein the representation filed by the petitioner against Mr.
R. Parveen Chandra (ML 2661) has been dealt with (refer para
6(ii), page 11-13 of the CEC Report dated 28th March, 2012). In
the said representation it has been alleged that Mr. Parveen
Chandra the lessee of ML No.2661 has made two payments, one of
Rs.2.50 crores to M/s Bhagat Homes Private Limited and the other
of Rs.3.5 crores to M/s Dhavalagir Property Developers Private
Limited as a quid pro quo for allotment of the said mining
lease. It is RECOMMENDED that this Hon’ble Court may consider
directing the investigating agency such as CBI to investigate
the payments made by the above said lessee to these two
companies whose Directions / shareholders are the close
relatives of the then Chief Minister, Karnataka and whether
there was any link between such payments and grant of mining
lease to Mr. Parveen Chandra.”
15. When we heard the parties to the lis and even permitted the affected
parties as interveners, the hearing had been restricted to the Report of
the CEC dated 20th April, 2012. Therefore, presently, we are passing
directions only in relation to that Report, while postponing the hearing of
the second Report which is dated 27th April, 2012.
16. In the backdrop of the above events of the case, reference to certain
relevant provisions of the Criminal Procedure Code, 1973 (Cr.P.C.) can now
be appropriately made, before we proceed to deal with the above noticed
contentions.
17. The machinery of criminal investigation is set into motion by the
registration of a First Information Report (FIR), by the specified police
officer of a jurisdictional police station or otherwise. The CBI, in
terms of its manual has adopted a procedure of conducting limited pre-
investigation inquiry as well. In both the cases, the registration of the
FIR is essential. A police investigation may start with the registration
of the FIR while in other cases (CBI, etc.), an inquiry may lead to the
registration of an FIR and thereafter regular investigation may begin in
accordance with the provisions of the CrPC. Section 154 of the CrPC
places an obligation upon the authorities to register the FIR of the
information received, relating to commission of a cognizable offence,
whether such information is received orally or in writing by the officer in-
charge of a police station. A police officer is authorised to
investigate such cases without order of a Magistrate, though, in terms of
Section 156(3) Cr.P.C. the Magistrate empowered under Section 190 may
direct the registration of a case and order the police authorities to
conduct investigation, in accordance with the provisions of the CrPC.
Such an order of the Magistrate under Section 156(3) CrPC is in the nature
of a pre-emptory reminder or intimation to police, to exercise their
plenary power of investigation under that Section. This would result in a
police report under Section 173, whereafter the Magistrate may or may not
take cognizance of the offence and proceed under Chapter XVI CrPC. The
Magistrate has judicial discretion, upon receipt of a complaint to take
cognizance directly under Section 200 CrPC, or to adopt the above
procedure. [Ref. Gopal Das Sindhi & Ors. v. State of Assam & Anr. [AIR 1961
SC 986]; Mohd. Yusuf v. Smt. Afaq Jahan & Anr. [AIR 2006 SC 705]; and Mona
Panwar v. High Court of Judicature of Allahabad Through its Registrar &
Ors. [(2011) 3 SCC 496].
18. Once the investigation is conducted in accordance with the provisions
of the CrPC, a police officer is bound to file a report before the Court of
competent jurisdiction, as contemplated under Section 173 CrPC, upon which
the Magistrate can proceed to try the offence, if the same were triable by
such Court or commit the case to the Court of Sessions. It is significant
to note that the provisions of Section 173(8) CrPC open with non-obstante
language that nothing in the provisions of Section 173(1) to 173(7) shall
be deemed to preclude further investigation in respect of an offence after
a report under sub-Section (2) has been forwarded to the Magistrate. Thus,
under Section 173(8), where charge-sheet has been filed, that Court also
enjoys the jurisdiction to direct further investigation into the offence.
{Ref., Hemant Dhasmana v. Central Bureau of Investigation & Anr. [(2001) 7
SCC 536]}. This power cannot have any inhibition including such requirement
as being obliged to hear the accused before any such direction is made.
It has been held in Shri Bhagwan Samardha Sreepada Vallabha Venkata
Vishwandha Maharaj v. State of Andhra Pradesh and Ors. [JT 1999 (4) SC
537] that the casting of any such obligation on the Court would only result
in encumbering the Court with the burden of searching for all potential
accused to be afforded with the opportunity of being heard.
19. While the trial Court does not have inherent powers like those of the
High Court under Section 482 of the CrPC or the Supreme Court under Article
136 of the Constitution of India, such that it may order for complete
reinvestigation or fresh investigation of a case before it, however, it has
substantial powers in exercise of discretionary jurisdiction under Sections
311 and 391 of CrPC. In cases where cognizance has been taken and where a
substantial portion of investigation/trial have already been completed and
where a direction for further examination would have the effect of delaying
the trial, if the trial court is of the opinion that the case has been made
out for alteration of charge etc., it may exercise such powers without
directing further investigation. {Ref. Sasi Thomas v. State & Ors.
[(2006) 12 SCC 421]}. Still in another case, taking the aid of the
doctrine of implied power, this Court has also stated that an express grant
of statutory power carries with it, by necessary implication, the authority
to use all reasonable means to make such statutory power effective.
Therefore, absence of statutory provision empowering Magistrate to direct
registration of an FIR would not be of any consequence and the Magistrate
would nevertheless be competent to direct registration of an FIR. {Ref.
Sakiri Vasu v. State of Uttar Pradesh & Ors. [(2008) 2 SCC 409]}.
20. Thus, the CrPC leaves clear scope for conducting of further inquiry
and filing of a supplementary charge sheet, if necessary, with such
additional facts and evidence as may be collected by the investigating
officer in terms of sub-Sections (2) to (6) of Section 173 CrPC to the
Court.
21. To put it aptly, further investigation by the investigating agency,
after presentation of a challan (charge sheet in terms of Section 173 CrPC)
is permissible in any case impliedly but in no event is impermissible.
22. A person who complains of commission of a cognizable offence has been
provided with two options under Indian Criminal jurisprudence. Firstly,
he can lodge the police report which would be proceeded upon as afore-
noticed and secondly, he could file a complaint under Section 200 CrPC,
whereupon the Magistrate shall follow the procedure provided under Sections
200 to 203 or 204 to 210 under Chapter XV and XVI of the CrPC.
23. In the former case, it is upon the police report that the entire
investigation is conducted by the investigating agency and the onus to
establish commission of the alleged offence beyond reasonable doubt is
entirely on the prosecution. In a complaint case, the complainant is
burdened with the onus of establishing the offence and he has to lead
evidence before the Court to establish the guilt of the accused. The rule
of establishing the charges beyond reasonable doubt is applicable to a
complaint case as well.
24. The important feature that we must notice for the purpose of the
present case is that even on a complaint case, in terms of Section 202, the
Magistrate can refer the complaint to investigation by the police and call
for the report first, deferring the hearing of the complaint till then.
Section 210 CrPC is another significant provision with regard to the powers
of the Court where investigation on the same subject matter is pending. It
provides that in a complaint case where any enquiry or trial is pending
before the Court and in relation to same offence and investigation by the
Police is in progress which is the subject matter of the enquiry or trial
before the Court, the Magistrate shall stay the proceedings and await the
report of the investigating agency. Upon presentation of the report, both
the cases on a Police report and case instituted on a complaint shall be
tried as if both were instituted on a Police report and if the report
relates to none of the accused in the complaint it shall proceed with the
enquiry/trial which had been stayed by it. The section proceeds on the
basis that a complaint case and case instituted on a police report for the
commission of the same offence can proceed simultaneously and the Court
would await the Police report before it proceeds with the complaint in such
cases. The purpose again is to try these cases together, if they are in
relation to the same offence with the intent to provide a fair and
effective trial. The powers of the trial court are very wide and the
legislative intent of providing a fair trial and presumption of innocence
in favour of the accused is the essence of the criminal justice system.
25. The Court is vested with very wide powers in order to equip it
adequately to be able to do complete justice. Where the investigating
agency has submitted the charge sheet before the court of competent
jurisdiction, but it has failed to bring all the culprits to book, the
Court is empowered under Section 319 Cr.P.C. to proceed against other
persons who are not arrayed as accused in the chargesheet itself. The
Court can summon such suspected persons and try them as accused in the
case, provided the Court is satisfied of involvement of such persons in
commission of the crime from the record and evidence before it.
26. We have referred to these provisions and the scope of the power of
the criminal court, in view of the argument extended that there are certain
complaints filed by private persons or that the matters are pending before
the court and resultantly this Court would be not competent in law to
direct the CBI to conduct investigation of those aspects. We may notice
that the investigation of a case or filing chargesheet in a case does not
by itself bring the absolute end to exercise of power by the investigating
agency or by the Court. Sometimes and particularly in the matters of the
present kind, the investigating agency has to keep its options open to
continue with the investigation, as certain other relevant facts,
incriminating materials and even persons, other than the persons stated in
the FIR as accused, might be involved in the commission of the crime. The
basic purpose of an investigation is to bring out the truth by conducting
fair and proper investigation, in accordance with law and ensure that the
guilty are punished. At this stage, we may appropriately refer to the
judgment of this Court in the case of Nirmal Singh Kahlon v. State of
Punjab & Ors. [(2009) 1 SCC 441] wherein an investigation was being
conducted into wrongful appointments to Panchayat and other posts by the
Police Department of the State. However, later on, these were converted
into a public interest litigation regarding larger corruption charges. The
matter was sought to be referred for investigation to a specialised agency
like CBI. The plea taken was that the Special Judge was already seized of
the case as charge sheet had been filed before that Court, and the question
of referring the matter for investigation did not arise. The High Court
in directing investigation by the CBI had exceeded its jurisdiction and
assumed the jurisdiction of the Special Judge. The plea of prejudice was
also raised. While rejecting these arguments, the appeals were dismissed
and this Court issued a direction to the CBI to investigate and file the
charge sheet before the Court having appropriate jurisdiction over the
investigation. The reasoning of the Court can be examined from paragraph 63
to 65 of the said judgment, which reads as under:-
“63. The High Court in this case was not monitoring any
investigation. It only desired that the investigation should be
carried out by an independent agency. Its anxiety, as is evident
from the order dated 3-4-2002, was to see that the officers of
the State do not get away. If that be so, the submission of Mr
Rao that the monitoring of an investigation comes to an end
after the charge-sheet is filed, as has been held by this Court
in Vineet Narain and M.C. Mehta (Taj Corridor Scam) v. Union of
India, loses all significance.
64. Moreover, it was not a case where the High Court had assumed
a jurisdiction in regard to the same offence in respect whereof
the Special Judge had taken cognizance pursuant to the charge-
sheet filed. The charge-sheet was not filed in the FIR which was
lodged on the intervention of the High Court.
65. As the offences were distinct and different, the High Court
never assumed the jurisdiction of the Special Judge to direct
reinvestigation as was urged or otherwise.”
27. Now, we shall proceed to examine the merit of the contentions raised
before us. We may deal with the submissions (a) and (b), together, as they
are intrinsically inter-related.
28. The CEC had submitted the Report dated 20th April, 2012 and it has
been stated in the Report that opportunity of being heard had been granted
to the affected parties. However, the contention before us is that while
the CEC heard other parties, it had not heard various companies like M/s.
South West Mining Ltd. and M/s. JSW Steel Ltd. Firstly, the CEC is not
vested with any investigative powers under the orders of this Court, or
under the relevant notifications, in the manner as understood under the
CrPC. The CEC is not conducting a regular inquiry or investigation with
the object of filing chargesheet as contemplated under Section 173 CrPC.
Their primary function and responsibility is to report to the Court on
various matters relating to collusion in illegal and irregular activities
that are being carried on by various persons affecting the ecology,
environment and reserved forests of the relevant areas. While submitting
such reports in accordance with the directions of this Court, the CEC is
required to collect such facts. In other words, it has acted like a fact
finding inquiry. The CEC is not discharging quasi-judicial or even
administrative functions, with a view to determine any rights of the
parties. It was not expected of the CEC to give notice to the companies
involved in such illegalities or irregularities, as it was not determining
any of their rights. It was simpliciter reporting matters to the Court as
per the ground realities primarily with regard to environment and illegal
mining for appropriate directions. It had made different recommendations
with regard to prevention and prosecution of environmentally harmful and
illegal activities carried on in collusion with government officers or
otherwise. We are of the considered view that no prejudice has been
caused to the intervenor/affected parties by non-grant of opportunity of
hearing by the CEC. In any case, this Court has heard them and is
considering the issues independently.
29. As far as the challenge to the enlargement of jurisdiction by the CEC
beyond the reference made by the Court, is concerned, the said contention
is again without any substance. We have referred to the various orders of
this Court. The ambit and scope of proceedings before this Court, pending
in the above writ petition and civil appeal, clearly show that the Court is
exercising a very wide jurisdiction in the national interest, to ensure
that there is no further degradation of the environment or damage to the
forests and so that illegal mining and exports are stopped. The orders
are comprehensive enough to not only give leverage to the CEC to examine
any ancillary matters, but in fact, place an obligation on the CEC to
report to this Court without exception and correctly, all matters that can
have a bearing on the issues involved in all these petitions in both the
States of Karnataka and Andhra Pradesh. Thus, we reject this contention
also.
30. Contention (c) is advanced on the premise that all matters stated by
the CEC are sub-judice before one or the other competent Court or
investigating agency and, thus, this Court has no jurisdiction to direct
investigation by the CBI. In any case, it is argued that such directions
would cause them serious prejudice.
31. This argument is misplaced in law and is misconceived on facts.
Firstly, all the facts that had been brought on record by the CEC are not
directly sub-judice, in their entirety, before a competent forum or
investigating agency.
32. In relation to issue 1(a) raised by the CEC which also but partially
is the subject matter of PCR No. 2 of 2011 pending before the Additional
City Civil and Sessions Judge, Bangalore under the Prevention of Corruption
Act. The Court took cognizance and summoned the accused to face the trial,
writ against the same is pending in the High Court. It primarily relates
to the improper de-notification of the land, which had been under
acquisition but possession whereof was not taken. This land was purchased
by the family members of the then Chief Minister for a consideration of
Rs.40 lacs and was sold after de-notification for a sum of Rs.20 crores to
South West Mining Ltd. after de-notification. For this purpose, office of
the Chief Minister and other higher Government Officials were used. While
the earlier part of above-noted violations is covered under PCR No. 2 of
2011, the transactions of purchase sale and other attendant circumstances
are beyond the scope of the said pending case which refers only to the
decision of de-notification. It appears that the entire gamut or the
complete facts stated by the CEC and supported by documents are not the
matter sub-judice before the Trial Court. Similarly, issue 1 (b) relates
to the donation of Rs.20 crores received by Prerna Education Society from
M/s. South West Mining Ltd. The society is stated to be belonging to the
members of the family of the Chief Minister Shri Yeddyurappa. The written
submissions filed on behalf of M/s. South West Mining Ltd., do not reflect
that issue 1(a) and (b) of the CEC report under consideration are directly
and in their entirety are the subject matter of any investigations in
progress and proceedings pending before any competent forum. These are
merely informatory facts, supported by relevant and authentic documents,
highlighted by the CEC in its report for consideration of the Court. A
suspect has no indefeasible right of being heard prior to initiation of the
investigation, particularly by the investigating agency. Even, in fact,
the scheme of the Code of Criminal Procedure does not admit of grant of any
such opportunity. There is no provision in the CrPC where an investigating
agency must provide a hearing to the affected party before registering an
FIR or even before carrying on investigation prior to registration of case
against the suspect. The CBI, as already noticed, may even conduct pre-
registration inquiry for which notice is not contemplated under the
provisions of the Code, the Police Manual or even as per the precedents
laid down by this Court. It is only in those cases where the Court directs
initiation of investigation by a specialized agency or transfer
investigation to such agency from another agency that the Court may, in its
discretion, grant hearing to the suspect or affected parties. However,
that also is not an absolute rule of law and is primarily a matter in the
judicial discretion of the Court. This question is of no relevance to the
present case as we have already heard the interveners.
33. In the case of Narmada Bai v. State of Gujarat & Ors. [(2011) 5 SCC
79], this Court was concerned with a case where the State Government had
objected to the transfer of investigation to CBI of the case of a murder of
a witness to a fake encounter. The CBI had already investigated the case
of fake encounter and submitted a charge sheet against high police
officials. This Court analyzed the entire law on the subject and cited
with approval the judgment of the Court in the case of Rubabbuddin Sheikh
v. State of Gujarat [(2010) 2 SCC 200]. In that case, the Court had
declared the law that in appropriate cases, the Court is empowered to hand
over investigation to an independent agency like CBI even when the charge-
sheet had been submitted. In the case of Narmada Bai, the Court had
observed that there was a situation which upon analysis of the allegations
it appeared that abduction of Sohrabuddin and Kausarbi thei their
subsequent murder as well as the murder of the witnesses are one series of
facts and was connected together as to form the same transaction under
Section 220 of the Code of Criminal Procedure and it was considered
appropriate to transfer the investigation of the subsequent case also to
CBI.
34. If we analyse the abovestated principles of law and apply the same to
the facts of the present case, then the Court cannot rule out the
possibility that all these acts and transactions may be so inter-connected
that they would ultimately form one composite transaction making it
imperative for the Court to direct complete and comprehensive investigation
by a single investigating agency. The need to so direct is, inter alia,
for the following considerations:
(a) The report of the CEC has brought new facts, subsequent events and
unquestionable documents on record to substantiate its
recommendations.
(b) The subsequent facts, inquiry and resultant suspicion, therefore, are
the circumstances for directing further and specialized
investigation.
(c) The scope and ambit of present investigation is much wider than the
investigations/proceedings pending before the Court/investigating
agencies.
(d) Various acts and transactions prima facie appear to be part of a same
comprehensive transaction.
(e) The requirement of just, fair and proper investigation would demand
investigation by a specialized agency keeping in view the dimensions
of the transactions, the extent of money involved and manipulations
alleged.
35. To give an example to emphasize that this is a case requiring further
investigation and is fit to be transferred to the specialized investigating
agency, we may mention that the South West Mining Ltd. was initially found
to be a front company of JSW Steels Ltd. Thereafter all transactions were
examined and the improper purchase of land and donations made by them came
to light. These facts appear to be inherently interlinked. Despite that
and intentionally, we are not dealing with the factual matrix of the case
or the documents on record, in any detail or even discussing the merits of
the case in relation to the controversies raised before us so as to avoid
any prejudice to the rights of the affected parties before the courts in
various proceedings and investigation including the proposed investigation.
36. Now, we shall proceed on the assumption that the illegalities,
irregularities and offences alleged to have been committed by the affected
parties are the subject matter, even in their entirety, of previous
investigation cases, sub-judice before various Courts including the writ
jurisdiction of the High Court. It is a settled position of law that an
investigating agency is empowered to conduct further investigation after
institution of a charge-sheet before the Court of competent jurisdiction.
A magistrate is competent to direct further investigation in terms of
Section 173(8) Cr.P.C. in the case instituted on a police report.
Similarly, the Magistrate has powers under Section 202 Cr.P.C. to direct
police investigation while keeping the trial pending before him instituted
on the basis of a private complaint in terms of that Section. The
provisions of Section 210 Cr.P.C. use the expression ‘shall’ requiring the
Magistrate to stay the proceedings of inquiry and trial before him in the
event in a similar subject matter, an investigation is found to be in
progress. All these provisions clearly indicate the legislative scheme
under the Cr.P.C. that initiation of an investigation and filing of a
chargesheet do not completely debar further or wider investigation by the
investigating agency or police, or even by a specialized investigation
agency. Significantly, it requires to be noticed that when the court is to
ensure fair and proper investigation in an adversarial system of criminal
administration, the jurisdiction of the Court is of a much higher degree
than it is in an inquisitorial system. It is clearly contemplated under
the Indian Criminal Jurisprudence that an investigation should be fair, in
accordance with law and should not be tainted. But, at the same time, the
Court has to take precaution that interested or influential persons are not
able to misdirect or hijack the investigation so as to throttle a fair
investigation resulting in the offenders escaping the punitive course of
law. It is the inherent duty of the Court and any lapse in this regard
would tantamount to error of jurisdiction.
37. In the case of Rama Chaudhary v. State of Bihar [(2009) 6 SCC 346],
this Court was considering the scope of Sections 173(8), 173(2) and 319 of
the CrPC in relation to directing further investigation. The accused
raised a contention that in that case, report had been filed, charges had
been framed and nearly 21 witnesses had been examined and at that stage, in
furtherance to investigation taken thereafter, if a supplementary charge-
sheet is filed and witnesses are permitted to be summoned, it will cause
serious prejudice to the rights of the accused. It was contended that the
Court has no jurisdiction to do so. The Trial Court permitted summoning
and examination of the summoned witnesses in furtherance to the
supplementary report. The order of the Trial Court was upheld by the High
Court. While dismissing the special leave petition, a Bench of this Court
observed :
“14. Sub-section (1) of Section 173 CrPC makes it clear that
every investigation shall be completed without unnecessary
delay. Sub-section (2) mandates that as soon as the
investigation is completed, the officer in charge of the police
station shall forward to a Magistrate empowered to take
cognizance of the offence on a police report, a report in the
form prescribed by the State Government mentioning the name of
the parties, nature of information, name of the persons who
appear to be acquainted with the circumstances of the case and
further particulars such as the name of the offences that have
been committed, arrest of the accused and details about his
release with or without sureties.
15. Among the other sub-sections, we are very much concerned
about sub-section (8) of Section 173 which reads as under:
“173. (8) Nothing in this section shall be deemed to preclude
further investigation in respect of an offence after a
report under sub-section (2) has been forwarded to the
Magistrate and, where upon such investigation, the officer
in charge of the police station obtains further evidence,
oral or documentary, he shall forward to the Magistrate a
further report or reports regarding such evidence in the
form prescribed; and the provisions of sub-sections (2) to
(6) shall, as far as may be, apply in relation to such
report or reports as they apply in relation to a report
forwarded under sub-section (2).”
A mere reading of the above provision makes it clear that
irrespective of the report under sub-section (2) forwarded to
the Magistrate, if the officer in charge of the police station
obtains further evidence, it is incumbent on his part to forward
the same to the Magistrate with a further report with regard to
such evidence in the form prescribed. The abovesaid provision
also makes it clear that further investigation is permissible,
however, reinvestigation is prohibited.
16. The law does not mandate taking of prior permission from the
Magistrate for further investigation. Carrying out a further
investigation even after filing of the charge-sheet is a
statutory right of the police. Reinvestigation without prior
permission is prohibited. On the other hand, further
investigation is permissible.
18. Sub-section (8) of Section 173 clearly envisages that on
completion of further investigation, the investigating agency
has to forward to the Magistrate a “further” report and not a
fresh report regarding the “further” evidence obtained during
such investigation.
19. As observed in Hasanbhai Valibhai Qureshi v. State of
Gujarat the prime consideration for further investigation is to
arrive at the truth and do real and substantial justice. The
hands of the investigating agency for further investigation
should not be tied down on the ground of mere delay. In other
words
“[t]he mere fact that there may be further delay in
concluding the trial should not stand in the way of further
investigation if that would help the court in arriving at
the truth and do real and substantial as well as effective
justice.”
38. Reference can also be made to the judgment of this Court in the case
of National Human Rights Commission v. State of Gujarat & Ors. [(2009) 6
SCC 342], wherein the Court was dealing with different cases pending in
relation to the communal riots in the State of Gujarat and the trial in one
of the cases was at the concluding stage. In the meanwhile, in another FIR
filed in relation to a similar occurrence, further investigation was being
conducted and was bound to have a bearing even on the pending cases. The
Court, while permitting inquiry/investigation, including further
investigation, completed stayed the proceedings in the Trial Court as well
and held as under :
“10. We make it clear that SIT shall be free to work out the
modalities and the norms required to be followed for the purpose
of inquiry/investigation including further investigation.
Needless to say the sole object of the criminal justice system
is to ensure that a person who is guilty of an offence is
punished.
11. Mr K.T.S. Tulsi, learned Senior Counsel had submitted that
in some cases the alleged victims themselves say that wrong
persons have been included by the police officials as accused
and the real culprits are sheltered. He, therefore, suggested
that trial should go on, notwithstanding the inquiry/
investigation including further investigation as directed by us.
We find that the course would not be appropriate because if the
trial continues and fresh evidence/materials surface, it would
require almost a de novo trial which would be not desirable.”
39. We do not find any necessity to multiply the precedents on this
issue. It is a settled principle of law that the object of every
investigation is to arrive at the truth by conducting a fair, unbiased and
proper investigation.
40. Referring to the plea of prejudice taken up by the affected parties
before us, we are unable to see any element of prejudice being caused to
the affected parties if the CBI is permitted to investigate the entire
matter. The plea taken by the interveners before us is that M/s. JSW
Steels Ltd. is a bona fide purchaser of iron ore from the open market and
they have been affected by the unilateral actions of one M/s. Mysore
Minerals Ltd. They state that they have no statutory liability to check
origin of iron ore or to maintain Form 27. According to M/s. JSW Steels
Ltd., they are already co-operating with the CBI in the investigation
directed by the Supreme Court. As far as M/s. South West Mining Ltd. is
concerned, it has stated that it is the purchaser of the land for bona fide
consideration and genuine purpose. The land has been converted to
commercial use and that is why Rs.20 crores were paid as consideration.
They further claimed that they had Rs.23.96 crores of pre-tax profit and,
therefore, they were in a position to make the donation which they had
made. Not only they, but other companies affiliated to Jindal Group have
also made similar contributions. It is not for us to examine whether the
stand taken by the intervener companies is correct or not. It requires to
be investigated and an investigation per se would help them to clear their
position, rather than subjecting them to face multifarious litigations,
investigations and economic burden. Having heard them, we are unable to
find any prejudice to parties if further or wider investigation is directed
by this Court. The direction of further investigation is based upon
documents and facts brought to light by the CEC as a result of examination
conducted in the course of its primary function relating to inquiry into
environmental violations and illegal mining activity. If the proceedings
are permitted to continue and finally investigations reveal that a case
which requires to be tried in accordance with law exists, then the
interveners would have to face proceedings all over again. So, it is in
their own interest that the specialized agency is permitted to investigate
and bring out the true facts before the Court of competent jurisdiction.
41. We must notice that the criminal offences are primarily offences
against the State and secondarily against the victim. In this case, if the
investigation by specialized agency finds that the suspect persons have
committed offences with or without involvement of persons in power, still
such violation undoubtedly would have been a great loss to the
environmental and natural resources and would hurt both the State and
national economy. We cannot expect an ordinary complainant to carry the
burden of proving such complex offences before the Court of competent
jurisdiction by himself and at his own cost. Doing so would be a travesty
of the criminal justice system.
42. It was ever and shall always remain the statutory the obligation of
the State to prove offences against the violators of law. If a private
citizen has initiated the proceedings before the competent court, it will
not absolve the State of discharging its obligation under the provisions of
the CrPC and the obligations of Rule of Law. The Court cannot countenance
an approach of this kind where the State can be permitted to escape its
liability only on the ground that multifarious complaints or investigations
have been initiated by private persons or bodies other than the State. In
our considered view, it enhances the primary and legal duty of the State to
ensure proper, fair and unbiased investigation.
43. The facts of the present case reveal an unfortunate state of affairs
which has prevailed for a considerable time in the mentioned districts of
both the States of Andhra Pradesh and Karnataka. The CEC has recommended,
and the complainant and petitioners have also highlighted, a complete
failure of the State machinery in relation to controlling and protecting
the environment, forests and minerals from being illegally mined and
exploited.
44. Wherever and whenever the State fails to perform its duties, the
Court shall step in to ensure that Rule of Law prevails over the abuse of
process of law. Such abuse may result from inaction or even arbitrary
action of protecting the true offenders or failure by different authorities
in discharging statutory or legal obligations in consonance with the
procedural and penal statutes. This Court expressed its concern about
the rampant pilferage and illegal extraction of natural wealth and
resources, particularly, iron ore, as also the environmental degradation
and disaster that may result from unchecked intrusion into the forest
areas. This Court, vide its order dated 29th July, 2011 invoked the
precautionary principle, which is the essence of Article 21 of the
Constitution of India as per the dictum of this Court in the case of M.C.
Mehta v. Union of India [(2009) 6 SCC 142], and had consequently issued a
ban on illegal mining. The Court also directed Relief and Rehabilitation
Programmes to be carried out in contiguous stages to promote inter-
generational equity and the regeneration of the forest reserves. This is
the ethos of the approach consistently taken by this Court, but this aspect
primarily deals with the future concerns. In respect of the past actions,
the only option is to examine in depth the huge monetary transactions which
were effected at the cost of national wealth, natural resources, and to
punish the offenders for their illegal, irregular activities. The
protection of these resources was, and is the constitutional duty of the
State and its instrumentalities and thus, the Court should adopt a holistic
approach and direct comprehensive and specialized investigation into such
events of the past.
45. Compelled by the above circumstances and keeping in mind the clear
position of law supra, we thus direct;
a) The issues specified at point 1(a) and 1(b) of the CEC Report dated 20th
April, 2012 are hereby referred for investigation by the Central Bureau
of Investigation.
b) All the proceedings in relation to these items, if pending before any
Court, shall remain stayed till further orders of this Court. The CBI
shall complete its investigation and submit a Report to the Court of
competent jurisdiction with a copy of the Report to be placed on the file
of this Court within three months.
c) The Report submitted by the CEC and the documents annexed thereto shall
be treated as ‘informant’s information to the investigating agency’ by
the CBI.
d) The CBI shall undertake investigation in a most fair, proper and
unbiased manner uninfluenced by the stature of the persons and the
political or corporate clout, involved in the present case. It will be
open to the CBI to examine and inspect the records of any connected
matter pending before any investigating agency or any court.
e) The competent authority shall constitute the special investigating team,
headed by an officer not below the rank of Additional Director General of
Police/Additional Commissioner forthwith.
f) Any investigation being conducted by any agency other than CBI shall
also not progress any further, restricted to the items stated in clause
(a) above, except with the leave of the Court. The CBI shall complete its
investigation uninfluenced by any order, inquiry or investigation that is
pending on the date of passing of this order.
g) This order is being passed without prejudice to the rights and
contentions of any of the parties to the lis, as well as in any other
proceedings pending before courts of competent jurisdiction and the
investigating agencies.
h) All pleas raised on merits are kept open.
i) We direct all the parties, the Government of the States of Andhra
Pradesh, Karnataka and all other government departments of that and/or
any other State, to fully cooperate and provide required information to
CBI.
46. With the above directions, we accept the recommendation of the CEC to
the extent as afore-stated.
47. Let the matter stand over to 3rd August, 2012 for consideration of
the Report dated 27th April, 2012 filed by the CEC.
….…………......................CJI.
(S.H. Kapadia)
…….…………......................J.
(Aftab Alam)
...….…………......................J.
(Swatanter Kumar)
New Delhi
May 11, 2012
