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25 Mar

Delhi Excise Policy Case: AAP Leaders involvement in Liquor Scam

Articles #AAP leaders, #arrest, #BRS leader Kavitha, #CBI, #delhi, #Delhi Excise Policy, #Delhi HC, #ED, #Kejiriwal, #Money Laundering, #scam, #Sisodia

Introduction

The controversial Delhi Excise Policy 2021-22 was introduced on November 17, 2021 with an aim to revolutionize the liquor retail landscape in the capital. Its objectives were to maximize revenue for the state, combat liquor mafia and black marketing, improve the consumer experience and ensure equitable distribution of liquor vends. It marked the withdrawal of the government from the business of selling liquor and allowed only private operators to run the liquor shops. The government also made the rules flexible for licensees, such as allowing them to offer discounts and set their own prices instead of selling on MRP fixed by the government. These reforms increased the Government’s revenue by 27 percent, generating around Rs. 8900 crore.

Under the new policy, the city was divided into 32 zones inviting firms to bid on the zones. Instead of individual licences, bidding was done zone-by-zone. Each municipal ward would have 2-3 vends. Also, licenses for 849 retail vends were issued through open bidding by the Excise department as opposed to 475 liquors shops run by the four government agencies, and 389 by the private operators under the old liquor policy.

For the first time, shops were allowed to offer discounts to retail customers, which attracted crowds and reduced the number of dry days from 21 to 3. The new policy also had a provision for home delivery of liquor. It even proposed lowering the drinking age from 25 to 21. It also suggested the opening of shops till 3 am. However, these were not implemented.

However, after a series of vehement opposition and allegations of procedural irregularities the Government of Delhi withdrew the policy on August 1st, 2022 and reverted to the old excise regime.

Report of Chief Secretary

The Chief Secretary found procedural lapses and irregularities in the new policy and submitted a report on the same to the Lieutenant Governor and Chief Minister of Delhi. According to the report, Manish Sisodia, Head of the Excise Department was accused of making changes to the excise policy without the approval of the L-G, such as allowing a waiver of Rs 144.36 crore on the tendered licence fee. Further, the arbitrary and unilateral decisions taken by then Minister resulted in financial losses to the exchequer, estimated at more than Rs 580 crore.

The law governing this subject states that if any changes are made to a policy that has already been implemented, the excise department needs to place them before the cabinet, and forward it to the L-G for final approval. However, the changes made by the Deputy CM did not comply with these mandates. Therefore, the policy implemented without the approval of the cabinet and L-G was illegal, and violative of the Delhi Excise Rules, 2010 and the Transaction of Business Rules, 1993.

Timeline of Events leading to the Arrest of AAP leaders

July 8, 2022: Chief Secretary submits report to L-G office alleging procedural lapses in excise policy implementation. L-G writes to MHA recommending CBI inquiry in matter.

July 30: Sisodia says Government to revert to old excise policy

Aug 6: L-G nod to suspend ex-excise commissioner, IAS officer Arava Gopi Krishna, Dy Commissioner Anand Tiwari

Aug 17: CBI files FIR

Aug 19: CBI Raids Deputy Chief Minister Manish Sisodia and Others on Delhi LG’s Recommendation, followed by Enforcement Directorate’s money laundering probe on liquor policy.

Sept 28 : CBI arrests Vijay Nair, the Aam Aadmi Party’s Chief of Communications.

Oct 10: CBI arrests Abhishek Boinpally

Nov 14: ED arrests Boinpally and Nair

Nov 24: CBI files Cargesheet; names 7

November 26: ED files first prosecution complaint/ chargesheet. Alleges excise policy “formulated with deliberate loopholes”, which “promoted cartel formations through back door” to benefit AAP leaders

January 6, 2023: ED files second prosecution com- plaint/supplementary chargesheet claiming CM allegedly spoke to one of main accused, Sameer Mahendru, asked him to continue working with co-accused Nair who he referred to as “his boy”.

January 14: CBI visits Sisodia’s office. He calls it “raid”, CBI denies

February 19: Sisodia says CBI called him for questioning again. Seeks week’s time

February 26: Sisodia arrested

March 2023: The Enforcement Directorate detains Manish Sisodia, the former deputy chief minister of Delhi.

October: AAP Leader Sanjay Singh is arrested by the Enforcement Directorate, and the first summons is issued to Delhi CM Arvind Kejriwal in connection with the liquor policy fraud.

November 2023: On November 2, Kejriwal flies to Singrauli, Madhya Pradesh, to address a political rally instead of responding to the ED’s first summons.

December 2023: Kejriwal ignores the second summons, saying it is ‘illegal and politically motivated’. The ED sends Kejriwal a third summons to appear for questioning on January 3.

January 2024: Kejriwal misses the third summons for alleged conspiracy by the Central government. In the same month, the ED issues a fourth summons to the Aam Aadmi Party (AAP) convenor, asking him to appear for questioning on January 18. Kejriwal responds to the Enforcement Directorate’s summons to him, asking the agency why notices were issued. The ED follows up by issuing its fifth summons.

February 2024: For the fifth time, Kejriwal ignores the Enforcement Directorate’s summons. An ED court filing from February said that the AAP politician was not following the summons. Kejriwal was granted a one-day reprieve from making a personal appearance by a Delhi court in February.

March 2024: In response to two allegations from the ED against Kejriwal for allegedly ignoring its summonses in the case, a sessions judge grants him bail.

Chief Minister Arvind Kejriwal files a petition with the Delhi High Court challenging ED summonses. He informed the Delhi High Court that he will not appear before the Enforcement Directorate due to a “clear intent” to arrest him during the upcoming elections.

The Delhi High Court refused to provide Kejriwal any protection from coercive action. Consequently, Kejriwal petitioned before the Supreme Court for protection against any coercive action by the ED.

Therefore, on account of ignoring nine summonses issued by the agency for questioning, the ED arrests Delhi Chief Minister Arvind Kejriwal.

Matter referred to CBI

The report of the Chief Secretary was referred to the CBI, which subsequently, led to the arrest of the then Delhi Deputy CM Manish Sisodia. 14 members belonging to AAP party were also made accused in its FIR.

Enforcement Directorate role in the case

Two cases, one by CBI and one on alleged money laundering being investigated by ED, have been registered in relation to the excise policy. The ED told the court that the alleged proceeds of crime amounted to more than Rs 292 crore, and that it was necessary to establish the modus operandi.

Manish Sisodia arrested in February 2023

AAP leader Sisodia has been under judicial custody since February 26 last year, after he was arrested by the CBI, which is also probing the “procedural lapses” in the policy execution. Sisodia is alleged to have “destroyed evidence” by changing his phone frequently, and the profit margin for wholesalers has been changed from 5 per cent to 12 per cent, among other accusations.

The case investigation began two months after Delhi LG VK Saxena assumed office in May 2022. He recommended a CBI probe into the malafide activities around the repealed policy.

BRS leader K Kavitha arrested on March 15

The Bharat Rashtra Samithi (BRS) leader K Kavitha also approached the Supreme Court over a plea against her arrest in the same probe. However, the court refused to take up her petition and asked her to approach the trial court first. Kavitha is alleged to have “plotted” with Kejriwal and jailed former Delhi deputy CM Manish Sisodia to get “favours” in excise policy. The agency claims that she is linked to a “south group” which paid about Rs 100 crore to AAP for skewing the policy in their favour.

Kejriwal arrested on March 21^st 2023

The Chief Minister filed a challenged his arrest before the Supreme Court. But, when the Court directed to try the case first before the lower courts in the similar matter involving Kavitha, the Minister withdrew his suit and contested before the High Court. A fresh plea in HC against ED, has been filed seeking protection from any coercive action by the ED.

References

20 Feb

Sec 6A Of The Delhi Special Police Establishment Act Cannot Be Applied Retrospectively: Supreme Court

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Case title: CBI Vs R.R Kishore

Case no.: Criminal Appeal No.377 Of 2007

Decided on: 11.09.2023

Quorum: Hon’ble Justice Sanjay Kishan Koul, Hon’ble Justice Sanjiv Khanna, Hon’ble Justice Abhay S. Oka, Hon’ble Justice Vikram Nath, Hon’ble Justice J.K Maheshwari.

Hon’ble Justices stated that “once a law is declared to be unconstitutional, being violative of Part-III of the Constitution, then it would be held to be void ab initio, still born, unenforceable and non est in view of Article 13(2) of the Constitution and its interpretation by authoritative pronouncements. Thus, the declaration made by the Constitution Bench in the case of Subramanian Swamy will have retrospective operation. Section 6A of the DSPE Act is held to be not in force from the date of its insertion i.e. 11.09.2003.”

BRIEF FACTS:

The story begins with the CBI registering an FIR against a Radiologist for offences under the Prevention of Corruption Act, 1988. Later they laid a trap and the radiologist is said to have accepted a bribe. A charge sheet was filed and before the Special Judge and the Radiologist filed a discharge petition. The main contention in that petition was that the trap which was a part of the enquiry/investigation had been laid without the previous approval of the Central Government as provided under Section 6A of the Delhi Special Police Establishment Act, 1946. Though the Special Judge rejected this discharge plea, the High Court of Delhi allowed his revision petition and held that the CBI acted in contravention of Section 6A DSPE Act. Against this judgment, the CBI approached the Apex Court.

During the pendency of this appeal, the constitution bench judgment Subramanian Swamy vs. Director, Central Bureau of Investigation was delivered, which held that Section 6A(1) of the DSPE Act was held to be invalid.

So when the appeal came up before the bench again, the CBI contended that Section 6A(1) has been declared to be unconstitutional, the judgment of the High Court deserves to be set aside and the prosecution should be allowed to continue with the proceedings from the stage of rejection of discharge application. In other words, the CBI contended that the Constitution bench judgment striking down Section 6A would have retrospective effect. On the other hand, the accused contended that this judgment could not have any retrospective operation. The court has placed this case before the constitutional bench to decide the matter at hand.

COURT ANALYSIS AND JUDGEMENT:

Taking into account the nuance of Article 13(2), the court ruled that the State is prohibited from making any law that takes away or limits the rights conferred by Part-III, and that any law made in violation of this clause is void to the extent of the violation. Article 13(2) prohibits the making of any law, so it would apply to laws enacted after the Constitution’s inception, such as the case at hand. In this case, it has been determined that Section 6A of the DSPE Act violates Article 14 of Part III of the Constitution, rendering it void.

The court additionally clarified how the word “void” must be construed. It noted that “void” has been interpreted in a number of judgements of this Court from 1951 to the present, and has been given various names such as ‘non est’, ‘void ab initio’, ‘still born’, and ‘unenforceable’.

The court stated that once a statute is deemed unconstitutional for violating Part III of the Constitution, it is void ab initio, still born, unenforceable, and non-existent under Article 13(2) of the Constitution.

Hence, the appeal of CBI is allowed and set aside the order of high court.

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Written by – Surya Venkata Sujith

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26 Jan

JUDICIAL REVIEW: COURTS CANNOT DELVE INTO THE MATTERS OF INSTITUTION’S REGULATORY FRAMEWORKS

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Case title: Vishal Tiwari vs Union of India & Ors.

Case no.: Writ Petition (C) no. 162 of 2023

Decided on: 03.01.2024

Quorum: Hon’ble Chief Justice of India Dr. D.Y Chandrachud, Hon’ble Justice J.B Pardiwala, Hon’ble Justice Manoj Misra.

FACTS OF THE CASE:

In February 2023, a batch of writ petitions filed before this Court under Article 32 of the Constitution raised concerns about the decline in investor wealth and market volatility caused by a drop in the Adani Group of Companies’ share prices.

Hindenburg Research, a “activist short seller,” allegedly caused the situation by publishing a report on the Adani group’s financial transactions on January 24, 2023. The report alleged, that the Adani group manipulated share prices and failed to disclose transactions with related parties and other relevant information in violation of SEBI regulations and securities legislation.

In WP (C) No.162 of 2023 the petitioner seeks the constitution of a committee monitored by a retired judge of this Court to investigate the Hindenburg Report.

In WP (C) No.201 of 2023, the petitioner claims that the Adani group has “surreptitiously controlled more than 75% of the shares of publicly listed Adani group companies, thereby manipulating the price of its shares in the market,” in violation of Rule 19A of the Securities Contracts (Regulation) Rules, 1957. The petitioner requests that the CBI or a Special Investigation Team conduct a court-monitored investigation into the fraud allegations and the alleged involvement of high-ranking officials of public sector banks and lending organisations.

In WP(Crl.) No. 57 of 2023, the petitioner requests that competent investigative agencies to (i) look into Adani Group transactions under the supervision of a sitting judge of this Court, and (ii) look into the involvement of the State Bank of India and the Life Insurance Corporation of India in these transactions.

In order to safeguard Indian investors from market volatility, the court stated that it was necessary to review and strengthen the financial sector’s current regulatory framework. This Court requested comments from the Solicitor General regarding the suggested formation of an Expert Committee for that reason.

The Court noted that SEBI had already taken over the investigation into the Adani group and ordered SEBI to proceed with the investigation, wrap it up in two months, and submit a status report to the Court.

Additionally, the court mandated the creation of an expert committee. This Court made it clear that SEBI and the Expert Committee would cooperate with one another. To put it another way, the SEBI investigation would continue unabated despite the Committee’s appointment. It is required of the Expert Committee to provide this Court with its report in a period of two months.

After that this Court received the Expert Committee’s report. The Court issued an order on May 17, 2023, granting SEBI an extension until August 14, 2023, for the submission of its investigation status report. Informing this Court of the progress of their twenty-four investigations, SEBI filed an interlocutory application on August 14, 2023. In addition, SEBI filed a status report describing the twenty-four investigations on August 25, 2023. SEBI has responded to the Expert Committee’s report, as has the petitioners’ legal representative.

LEGAL PROVISIONS:

The case is based on the Rule 19A of the Securities Contracts (Regulation) Rules 1957 which mandates a minimum of 25% public shareholding. The petitioners contended that By secretly controlling more than 75% of the shares of publicly listed Adani group companies, thereby manipulating the price of its shares in the market,” the Adani group is in violation of Rule 19A of the Securities Contracts (Regulation) Rules, 1957.

ISSUES RAISED:

Whether it is possible to seek judicial review of SEBI’s regulatory framework?

Whether the court has the power to transfer the investigation from SEBI to another agency or a SIT?

PETITIONERS CONTENTION:

Mr. Prashant Bhushan, appearing on behalf of the petitioner, broadly pressed his case for the following two requests: first, to establish a SIT to oversee the SEBI investigation into the Adani group and to have all such investigations court-monitored; and second, to direct SEBI to revoke certain amendments to the SEBI (Foreign Portfolio Investments) Regulations, 2014 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The investments by FPIs violate Rule 19A of the Securities Contracts (Regulations) Rules, 1957 which requires a minimum 25% public shareholding in all public-listed companies.

SEBI’sinabilitytoestablishaprimafaciecaseofregulatorynon-compliance and legal violations by the Adani group promoters despite starting an investigation in November 2020, appears to be prima facie self-inflicted. The unprecedented rise in the price of the Adani scrips occurred between January 2021 and December 2022, over a period when the Adani group was already under SEBI investigation.

They alleged that SEBI has wilfully delayed submitting its status report on the Adani group investigation within the time frame specified by this Court.

RESPONDENTS CONTENTION:

The respondents contended that SEBI has completed 22 of the 24 investigations it is currently conducting. In these investigations, enforcement actions/quasi-judicial proceedings would be initiated, where applicable. The delay by SEBI in filing the report is only ten days, which is unintentional and not wilful, given that twenty-four investigations were to be conducted.

They submitted that initially, the FPI Regulations permitted “opaque structures” under certain conditions, including the obligation to disclose beneficial owner information if requested. The subsequent amendment mandated the upfront disclosure of beneficial owners by FPIs. This rendered the disclosure clause redundant, resulting in its omission in 2019. The amendments tightened the regulatory framework by mandating disclosure requirements and eliminating the requirement to disclose only when requested.

COURT ANALYSIS AND JUDGMENNT

The court on judicial review held that the courts do not and cannot act as appellate authorities determining the correctness, suitability, and appropriateness of a policy, nor are courts advisors to expert regulatory agencies on policy matters that they have the authority to formulate. When examining a policy formulated by a specialised regulator, the scope of judicial review is to determine whether it (i) violates citizens’ fundamental rights; (ii) is contrary to Constitutional provisions; (iii) contradicts a statutory provision; or (iv) is manifestly arbitrary. Judicial review focuses on the policy’s legality, rather than its wisdom or soundness.

It held that the statutory regulator should not intervene in the policies that result from technical questions, especially in the fields of economics and finance, when experts in the field have voiced their opinions and the regulator has taken due consideration. As a regulatory, adjudicatory, and prosecutorial body, SEBI’s wide-ranging powers, expertise, and strong information-gathering system give its decisions a great degree of credibility. As such, this Court must be aware of the public interest guiding SEBI’s operations and refrain from imposing its own judgement on SEBI’s decisions.

The court on transfer of investigation has held that the authority to create a SIT or transfer an investigation from a recognised agency to the CBI. These kinds of authority ought to be applied rarely and only in dire situations. Generally speaking, the court will not substitute the authority vested with the investigative power unless it is demonstrated that the authority vested with the investigative power acted blatantly, intentionally, and wilfully ignorant of the facts. In the absence of the authority to transfer, the court may not use such powers unless there is a strong case showing that justice will likely be compromised.

The court also said that the petitioner must provide compelling evidence that the investigating agency was biased or that the investigation was inadequate. Only very rare and extraordinary situations may warrant the transfer of an investigation to an agency like the CBI. Furthermore, since the only thing that can be pleaded for is that the offence be thoroughly investigated, no one can demand that the offence be looked into by a particular agency.

Written by – Surya Venkata Sujith

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20 Jul

The confiscation order be modified, instead of ordering forfeiture of all the property opines Madras High Court.

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TITLE: D. Balasankaralingam Vs. State by Inspector of Police, CBI.

Decided On: July 17, 2023.

Crl.A.No.3 of 2009 and Crl.MP.No.660 of 2022.

CORAM: Hon’ble Mr. Justice G.Jayachandran.

Introduction:

Criminal Appeal has been filed under section 374 (2) of Criminal Procedure Code, against the judgment of the learned Additional Special Judge for CBI Cases, Chennai in CC.No.38 of 1999 dated 30.12.2008 convicting the Accused No.1/Appellant herein for the offence under Section 13(2) r/w 13(1)(d) of P.C.Act 1988 and sentencing him to undergo five years R.I and to pay a fine of Rs.1,00,000/- and in default of payment of fine to undergo imprisonment for a period of one year and convicting Accused No.2/Appellant herein for the offence under Section 109 IPC r/w Section 13(2) r/w Section 13(1)(e) of P.C.Act 1988 and sentencing to undergo a period of 3 years and a fine of Rs.10,000/- in default to undergo imprisonment for a period of three months.

Facts:

The appellants Balasankaralingam and Jayalakshmi are husband and wife. The first appellant Balasankaralingam is a public servant who joined the Customs Department as Preventive Officer in the year 1977. While he was serving as Superintendent (Preventive) of Customs prosecuted for possession of assets disproportionate to the known source of income.His wife Jayalakshmi was prosecuted for abetting him to commit the said offence. The Criminal law was set into motion after the residential premises of the first appellant Balasankaralingam was searched on 19.02.1997. During the search, liquid cash of Rs.8,81,540/- was recovered from his residence. Search of two bank lockers operated in the name of his wife Jayalakshmi/ the second accused/second appellant led to further recovery of Rs.5,25,000/- and Rs.25,00,000/- respectively. The search also led to recovery of cash bills, invoices, share certificates, FD receipts, sale deeds, LIC Policies, UTI Units and other incriminating materials. The investigation had brought to light that Balasankaralingam who joined service on 08.12.1977 was terminated from service on 08.01.1980 pursuant to departmental enquiry. Later, he was reinstated in service as Preventive Officer on 15.12.1987 based on the orders passed by Central Administrative Tribunal. He was promoted as Superintendent with effect from 09.11.1994. He was not in service for substantial period of time and he had no other income other than his salary. While so, the investigation has unravelled, he and his family members were maintaining several bank accounts and lockers. He had invested in movables and immovables for which, the sources are unknown. Most of the properties were acquired after the accused got reinstated in service. Taking the period from 15.12.1987 to 20.02.1997 as check period, the prosecution has collected materials which prima facie satisfied that the accused has acquired assets value of Rs.1,10,50,128.22/- disproportionate to his known source of income. Final report filed with details of assets held at the beginning of the check period and assets acquired during the check period, the assets held at the end of check period. The trial court directed to confiscate the assets worth about Rs.1,05,74,000/- acquired. disproportionate to the known source of income. Aggrieved by the conviction and sentence, the appellants have preferred the criminal appeal under Section 374 of Cr.P.C before this Court.

Legal Analysis and Decision:

The value of the asset acquired by the accused in his name and his family members names is almost double the estimated savings from the known source of income. While so, except some minor error in assessment which has no bearing in the decision, this Court finds the trial court judgment has appreciated the law as well as the fact. For the contention of the learned Senior counsel for the appellants that the change in the law after 2018 though it is captioned as amendment it is only a substitution to the old provision of law under the Prevention of Corruption Act governing disproportionate of asset, this Court finds that even such liberal interpretation is given to the provision of law, it will not be of any use for the appellants herein. The law expects satisfactory explanation for the source of income, in this case, that is missing. The claim and attempt made by the appellants to project the explanations through their witnesses and documents in fact had exposed suppression of their income from other sources. After the search and recovery of huge currency, an attempt make believe story of prior sale agreements and suits for enforcement of the sale agreements been created. The trial Court has rightly held that these documents are ante dated. After close scrutiny one document namely the agreement with JKK Rangammal Charitable Trust where the accused has probalized that they have entered into an agreement and received sale consideration 12 lakhs for other transactions the view of the trial Court is confirmed. Therefore, the Court ever after, due credit for that receipt of Rs.12,00,000/- as income during the check period, find a vast difference between their known source of income and the value of assets which they have invested is very huge and the disproportionality is shocking event if it is estimated moderately. Therefore, this Court confirms the judgment of the trial court. Accordingly, the order of conviction passed in C.C.No.3 of 2009 is confirmed. The Criminal Appeal No.3 of 2009 is dismissed. Taking note of the age of the appellants, this Court grants 30 days time for them to surrender, failing which, the respondent police shall secure them and commit to prison to undergo the remaining period of sentence.

Conclusion:

Taking note of the fact that, out of 12 properties listed for confiscation three have locked in litigation and third party right has come into force due to court intervention and therefore, this Court is of the opinion the confiscation order be modified, instead of ordering forfeiture of all the property. As far as the order of confiscation, the same is modified to the effect that in lieu of forfeiture, the appellants jointly and severally shall pay a sum of Rs.25,00,000/- which shall be around 50% of the value assessed as disproportionate to the known source of income.

JUDGEMENT REVIEWED BY JANGAM SHASHIDHAR.

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19 Jul

Madras High Court Ordered Fresh Preliminary Inquiry Against AIADMK general secretary.

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TITLE: RS Bharathi v. The Director of Vigilance, Anti Corruption and anrs.

Decided On: July 18, 2023.

Criminal Original Petition No.20711 of 2018.

CORAM: Hon’ble Mr. Justice N. Anand Venkatesh.

Introduction:

Dismissing the petition, Justice Anand Venkatesh observed that the earlier preliminary enquiry conducted by the DVAC, which did not find any materials to proceed against Palaniswami, was not unreasonable to necessitate another preliminary enquiry afresh. “There is no doubt in the mind of this Court that the first respondent took a volte-face on account of change of government and things started moving in the year 2023. In none of the communications that was placed before this Court, there is even a reference that the earlier preliminary inquiry report is not in conformity with law or that it is unreasonable or that some new materials have cropped up to order for a fresh inquiry. Hence, this Court holds that the preliminary inquiry has been directed to be held afresh only for the reason that the other political party has come into power. The political agenda of an individual or a political party should not be subversive of the rule of law,” the court observed.

Facts:

This petition was disposed of on 12.10.2018 after contest by a learned Single Judge of this Court directing the first respondent to hand over investigation to the Central Bureau of Investigation (CBI) and further directing the CBI to conduct the preliminary inquiry within a period of three months. It was made clear in the said order dated 12.10.2018 that if the preliminary inquiry disclosed any cognizable offence, the CBI was further directed to register a case and proceed further in accordance with law. The said order dated 12.10.2018 became the subject matter of challenge before the Apex Court in Criminal Appeal Nos.1256 and 1257 of 2022. The said criminal appeals, which were filed before the Apex Court by the aggrieved persons namely both the respondents herein, were disposed of by the Apex Court by a common judgment dated 03.8.2022. Pursuant to the said common judgment rendered by the Apex Court, the matter came up for hearing on 06.7.2023, on which date, this Court passed the order. The case was once again posted for hearing on 13.7.2023 and this Court heard the submissions made by the learned counsel on either side with respect to the preliminary objection raised by the second respondent regarding the request made by the petitioner for withdrawal of this criminal original petition in view of the subsequent development.

Legal Analysis and Decision:

In the present case, the High Court had earlier allowed the petition filed by former DMK MP RS Bharathi seeking investigation against the former CM and directed the DVAC to handover the investigation to the CBI. When Palaniswami and the DVAC moved separate appeals, the Supreme Court set aside the order and directed the High Court to consider the matter afresh. The Apex Court had noted that the single judge had not even perused the preliminary report that was submitted by the DVAC nor had the court impleaded Palaniswami before transferring investigation to the CBI. Following this, when the High Court took up the matter, the State Public Prosecutor informed the court that the earlier Preliminary report which was submitted by the Director of Vigilance and Anti-Corruption was rejected by the Vigilance Commissioner and a fresh enquiry had been ordered. Though based on this development, Bharathi submitted that he may be allowed to withdraw the petition, the same was objected to by Palaniswami who argued that the Supreme Court had specifically directed the High Court to consider the matter afresh and thus there was no scope for permitting withdrawal. It was also argued by Palaniswami that just because a favourable political climate was prevailing in the State, Bharathi should not be allowed to change his stand. He also requested the court to go through the preliminary report and satisfy itself with the reasons assigned for submitting a closure report.

The court, on perusing the preliminary inquiry report, found that the five allegations made against Palaniswami were independently dealt with and based on materials, the Enquiry officer had come to the conclusion that there was no sufficient and tangible evidence to substantiate the allegations and that there was no favouritism or abuse of public office by Palaniswami. The court noted that this preliminary report was initially accepted by the Director of Vigilance and Anti-Corruption which was evident from the SLP filed before the Supreme Court. The court noted that the Government had, without assigning any reasons, ordered for a fresh preliminary enquiry. This, according to the court, was only due to a change in the political power in the State.

The court noted that in the present case, the DVAC was an independent body belonging to the Executive organ of the State. However, the only reason why it had taken a different stand and had asked the government regarding action to be taken against Palaniswami was only due to the change in the power dynamics, it added. The court noted that Courts have become playground for political parties to score points. “In cases of this nature, the Court is like a playground where the ruling and opposition party try to score a point for their own political games. Ultimately, the order passed by the Court will only become a subject matter of a talk show in the television channels, which will be discussed with a lot of hue and cry where the participants will scream at the top of their voice supporting one party or the other and ultimately, it will all get consigned to nothing,” the court said. Thus, finding no apparent illegality in the preliminary inquiry report and no reason for conducting another preliminary inquiry afresh, the court dismissed the petition. It further noted that the only appropriate remedy for Bharathi was to approach the Magistrate.

Conclusion:

The Madras High Court yesterday ruled that there is no reason for conducting another preliminary inquiry by Director of Vigilance and Anti Corruption against former CM Edappadi K. Palaniswami into an alleged State highway tender scam as the earlier report does not suffer from any apparent illegality or unreasonableness. The court said the fresh inquiry has been ordered against the AIADMK general secretary only due to change of government in the State.

JUDGEMENT REVIEWED BY JANGAM SHASHIDHAR.

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