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REPORTABLE

IN THE SUPREME COURT OF INDIA CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO. 1838 OF 2013

C.B.I.                             ...Appellant  

Versus  

Ashok Kumar Aggarwal                                      ...Respondent  

                    J U D G M E N T  

Dr. B.S. Chauhan, J.

1. This appeal has been preferred against the impugned judgment  

and order dated 3.10.2007 passed by the High Court of Delhi at New  

Delhi allowing Crl. R.P. No. 589 of 2007, setting aside the order dated  

28.7.2007 passed by the court  of  Special  Judge,  Central Bureau of  

Investigation  (hereinafter  referred  to  as  the  ‘CBI’),  by  which  and  

whereunder  the  Special  Judge  rejected  the  application  of  the  

respondent  questioning  the  sanction  granted  by  the  competent  

authority under Section 19 of the Prevention of Corruption Act, 1988  

(hereinafter referred to as the ‘Act 1988’),  observing that the issue  

could be examined during trial.   

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2. Facts and circumstances giving rise to this appeal are that:

A. The appellant, CBI registered a preliminary enquiry against the  

respondent for disproportionate assets to the tune of Rs.8,38,456/- on  

17.9.1999. After conclusion of the preliminary enquiry, a regular case  

was registered on 7.12.1999 as FIR No. S19/E0006/99 in respect of  

the same to the tune of Rs.40,42,23,478/-.  

B. During  the  course  of  investigation,  it  came  to  light  that  

disproportionate  assets  were only  to  the  tune of  Rs.12,04,46,936/-,  

which was 7615.45 times of his known sources of income. It further  

surfaced that the respondent was involved in money laundering; and  

for  channelising  his  ill-gotten wealth,  had established  a  number  of  

companies wherein his family members were the founding directors.   

C. The CBI sent a letter to the Ministry of Finance dated 24.5.2002  

for accord of sanction for prosecution of the respondent.  The same  

was  accompanied  by  the  Superintendent  of  Police’s  (hereinafter  

referred to as the ‘SP’) report of 163 pages containing a detailed gist  

of the relevant statements and documents including the information on  

income tax returns etc.  

D. The  Central  Vigilance  Commission  after  examining  the  said  

case advised the Ministry of Finance to grant sanction for prosecution.  

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The  Investigating  Officer  visited  the  Directorate  of  Income  Tax  

(Vigilance) in September 2002 and placed necessary documents for  

the perusal of the Additional Director, Income Tax (Vigilance) who  

was seized of the matter pertaining to the sanction for prosecution of  

the respondent.  The Finance Minister accorded sanction vide order  

dated 2.11.2002 and as a consequence thereof, the sanction order was  

issued vide order dated 26.11.2002 under the seal and signature of the  

Under Secretary (V&L), Ministry of Finance.  

E. A charge sheet was filed by the CBI before the Court of Special  

Judge  on  5.12.2002  and  on  the  basis  of  the  same,  the  court  took  

cognizance and issued summon to the respondent on 10.1.2003.   

F. The respondent challenged the validity of the sanction by filing  

an application dated 1.5.2003 and a similar application was again filed  

on 12.9.2005. The learned Special Judge heard the said applications  

and dismissed the same vide order dated 28.7.2007, holding that it  

was not the appropriate stage to decide as to whether sanction granted  

by the competent authority was invalid.  

G. The  respondent  filed  a  Revision  Application  under  Sections  

397, 401 r/w 482 of Code of Criminal Procedure, 1973 (hereinafter  

referred to  as  the ‘Cr.P.C.’)  for  setting aside  the said  order  of  the  

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Special Judge dated 28.7.2007.  The said petition was contested by the  

appellant.  However,  the  High  Court  vide  impugned  judgment  and  

order set aside the order of the Special Judge and remanded the case  

to  record  a  finding  on  the  question  of  any  failure  of  justice in  

according  sanction  and  to  examine  the  sanctioning  authority,  as  a  

witness even at pre-charge stage, if it deems fit.  

Hence, this appeal.  

3. Shri K.V. Vishwanathan, learned Additional Solicitor General  

appearing  for  the  appellant  has  submitted  that  the  application  

challenging the  validity  of  the sanction  at  a  stage  anterior  even to  

framing of the charges is unheard of and is in contravention of the  

settled legal  propositions. In view of the fact that the sanction had  

been granted by the competent authority, the only issue remains as to  

whether  the relevant  material  had been disclosed/placed  before the  

sanctioning authority and the said authority had considered the same.  

The sanctioning authority can delegates its power to other officer or at  

least  can  act  on  the  advice  or  notes  prepared by his  subordinates.  

However,  such  an  issue  can  be  agitated  only  during  the  trial.  

Therefore,  the  High Court  committed  an  error  in  setting  aside  the  

order of the learned Special Judge and remanding the matter and also  

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to  examine,  if  necessary,  the  sanctioning  authority  i.e.  the  then  

Hon’ble  Finance  Minister  at  a  pre-charge  stage.  Thus,  the  appeal  

deserves to be allowed.  

4. Per  contra,  Shri  Ram  Jethmalani,  learned  senior  counsel  

appearing for the respondent has opposed the appeal contending that  

the court is not permitted to take cognizance in the absence of valid  

sanction granted by the competent authority in accordance with law.  

In the instant case, the relevant material including the statement of the  

witnesses  recorded  by  the  investigating  officer  under  Section  161  

Cr.P.C. and a large amount of documentary evidence collected during  

the investigation were not placed before the Hon’ble Minister when  

the sanction was granted. The sanctioning authority did not examine  

the relevant documents which had been of an impeccable character  

before  granting  the  sanction.  Statement  of  13  witnesses  had  been  

recorded  between  10.5.2002  and  16.10.2002  out  of  which  the  

statement of 10 witnesses had been recorded only after sending the  

SP’s report to the sanctioning authority for obtaining the sanction for  

prosecution.  Even  if  any  officer  of  the  CBI  was  present  with  the  

record in the office of the Finance Minister, there is nothing on record  

to show that the sanctioning authority was informed about this fact  

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or that the sanctioning authority had examined any record so sent to  

his office. In the earlier litigation, the High Court vide order dated  

9.4.2002 had directed the Revenue Secretary to examine and consider  

the record of the investigation  fairly and objectively,  by taking into  

consideration all  relevant facts and circumstances and then proceed  

with the case.  By the said order, the Director, CBI was also asked to  

examine  the  investigation  record  of  the  case  and  to  consider  all  

relevant aspects and factors in the light of the representation of the  

respondent and to pass appropriate orders within a stipulated period of  

two months. In such a fact-situation, the issue of sanction has to be  

considered at a pre-charge stage and such a void sanction cannot be a  

foundation for a valid trial. In pursuance of the impugned order, the  

Special Judge has summoned the then sanctioning authority and the  

latter filed an affidavit before the Special Judge that relevant material  

was  not  placed  before  him  at  the  relevant  time.  The  appellant  

suppressed all  these facts  and obtained the interim order from this  

court. The conduct of the appellant disentitles it for any relief from  

this court. Further placing reliance on the judgments of this court in  

Costao Fernandes v. State, AIR 1996 SC 1383; and Center for PIL  

& Anr. v. UOI & Ors., AIR 2001 SC 80, it is submitted that CBI is  

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not  a  trustworthy  investigating  agency.   Thus,  no  interference  is  

required with the impugned judgment and order. The appeal is liable  

to be dismissed.  

5. We  have  considered  the  rival  submissions  made  by  learned  

counsel for the parties and perused the record.  

6. In State of M.P. v. Dr. Krishna Chandra Saksena (1996) 11  

SCC 439, while dealing with the issue this Court held :

“…the  sanctioning  authority was  satisfied  after   complete  and  conscious  scrutiny  of  the  records  produced  in  respect  of  the  allegation  against  the   accused.  Now  the  question  whether  all  the  relevant   evidence which would have tilted the balance in favour   of the accused if  it  was considered by the sanctioning   authority  before  granting  sanction  and  which  was   actually  left  out  of  consideration  could  be  examined  only at the stage of trial when the sanctioning authority   comes forward as a prosecution witness to support the   sanction  order  if  challenged  during  the  trial.  As  that   stage was not  reached the prosecution could not  have   been quashed at  the very  inception on the supposition   that all relevant documents were not considered by the   sanctioning  authority  while  granting  the  impugned   sanction.”  

(Emphasis added)

7. The  prosecution  has  to  satisfy  the  court  that  at  the  time  of  

sending the matter for grant of sanction by the competent authority,  

adequate  material  for  such  grant  was  made  available  to  the  said  

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authority.  This may also be evident from the sanction order, in case it  

is extremely comprehensive, as all the facts and circumstances of the  

case  may  be  spelt  out  in  the  sanction  order.  However,  in  every  

individual case, the court has to find out whether there has been an  

application of mind on the part of the sanctioning authority concerned  

on the material placed before it.  It is so necessary for the reason that  

there is an obligation on the sanctioning authority to discharge its duty  

to give or withhold sanction only after having full knowledge of the  

material facts of the case. Grant of sanction is not a mere formality.  

Therefore, the provisions in regard to the sanction must be observed  

with complete strictness keeping in mind the public interest and the  

protection  available  to  the  accused  against  whom  the  sanction  is  

sought.  

It  is  to  be  kept  in  mind  that  sanction  lifts  the  bar  for  

prosecution. Therefore, it is not an acrimonious exercise but a solemn  

and sacrosanct act which affords protection to the government servant  

against  frivolous prosecution.  Further,  it  is  a weapon to discourage  

vexatious prosecution and is a safeguard for the innocent, though not a  

shield for the guilty.  

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Consideration  of  the  material  implies  application  of  mind.  

Therefore,  the  order  of  sanction  must  ex  facie disclose  that  the  

sanctioning authority had considered the evidence and other material  

placed  before  it.  In  every  individual  case,  the  prosecution  has  to  

establish  and satisfy the court  by leading evidence that  those facts  

were placed before the sanctioning authority and the authority  had  

applied its mind on the same. If the sanction order on its face indicates  

that  all  relevant  material  i.e.  FIR,  disclosure  statements,  recovery  

memos, draft charge sheet and other materials on record were placed  

before the sanctioning authority and if it is further discernible from  

the recital of the sanction order that the sanctioning authority perused  

all the material, an inference may be drawn that the sanction had been  

granted in accordance with law.  This becomes necessary in case the  

court is to examine the validity of the order of sanction inter-alia  on  

the  ground  that  the  order  suffers  from  the  vice  of   total  non-

application of mind.  

(Vide: Gokulchand Dwarkadas Morarka v. King, AlR 1949 PC 82;  

Jaswant Singh v. State of Punjab, AIR 1958 SC 124; Mohd. Iqbal  

Ahmed v.  State of  A.P.,  AIR 1979 SC 677; State through Anti-  

Corruption  Bureau,  Govt.  of  Maharashtra  v.  Krishanchand  

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Khushalchand Jagtiani,  AIR 1996 SC 1910; State  of  Punjab v.  

Mohd.  Iqbal  Bhatti,  (2009)  17 SCC 92;  Satyavir  Singh Rathi,  

ACP v.  State,  AIR 2011 SC 1748; and  State of  Maharashtra v.  

Mahesh G. Jain, (2013) 8 SCC 119).   

8. In view of the above, the legal propositions can be summarised  

as under:

(a) The prosecution  must  send  the  entire relevant  record  to  the  

sanctioning  authority  including  the  FIR,  disclosure  statements,  

statements of witnesses, recovery memos, draft charge sheet and all  

other  relevant material.  The record so sent  should also contain the  

material/document, if any, which may tilt the balance in favour of the  

accused and on the basis of which, the competent authority may refuse  

sanction.  

(b) The authority itself has to do complete and conscious scrutiny  

of  the whole record so produced by the prosecution independently  

applying its mind and taking into consideration all the relevant facts  

before grant of sanction while discharging its duty to give or withhold  

the sanction.  

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(c) The power to grant sanction is to be exercised strictly keeping  

in mind the public interest and the protection available to the accused  

against whom the sanction is sought.

(d) The order of sanction should make it evident that the authority  

had been aware of all relevant facts/materials and had applied its mind  

to all the relevant material.  

(e) In every individual case, the prosecution has to establish and  

satisfy the court by leading evidence that the entire relevant facts had  

been placed before  the  sanctioning authority  and the authority  had  

applied its mind on the same and that the sanction had been granted in  

accordance with law.  

9. In view of the above, we do not find force in the submissions  

advanced  by  Shri  Vishwanathan,  learned  ASG that  the  competent  

authority can delegate its power to some other officer or authority, or  

the Hon’ble Minister could grant sanction even on the basis of the  

report  of  the SP.    The  ratio  of  the judgment  relied upon for  this  

purpose, in A. Sanjeevi Naidu etc. v. State of Madras & Anr., AIR  

1970 SC 1102, is not applicable as in the case of grant of sanction, the  

statutory authority has to apply its mind and take a decision whether  

to grant sanction or not.    

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10. This Court in Ashok Tshering Bhutia v. State of Sikkim, AIR  

2011 SC 1363, while dealing with the issue whether invalid sanction  

goes to the root of jurisdiction of the Court which would vitiate the  

trial and conviction, held that in the absence of anything to show that  

any  defect  or  irregularity  therein  caused  a  failure  of  justice,  the  

contention was without any substance.  The failure of justice would be  

relatable  to  error,  omission or  irregularity  in  the grant  of  sanction.  

However,  a  mere  error,  omission  or  irregularity  in  sanction  is  not  

considered to be fatal unless it has resulted in the failure of justice or  

has been occasioned thereby.   

11. The  court  must  examine  whether  the  issue  raised  regarding  

failure of justice is actually a failure of justice in the true sense or  

whether it is only a camouflage argument.  The expression ‘failure of  

justice’ is an extremely pliable or facile an expression which can be  

made to fit into any case.  

The court must endeavour to find out the truth. There would be  

‘failure of justice’ not only by unjust conviction but also by acquittal  

of  the  guilty  as  a  result  of  unjust  or  negligent  failure  to  produce  

requisite evidence. Of course, the rights of the accused have to be kept  

in mind and safeguarded but they should not be over emphasised to  

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the extent of forgetting that the victims also have certain rights. It has  

to be shown that the accused has suffered some disability or detriment  

in  the  protections  available  to  him  under  Indian  Criminal  

Jurisprudence.  ‘Prejudice’  is  incapable  of  being  interpreted  in  its  

generic  sense  and  applied  to  criminal  jurisprudence.  The  plea  of  

prejudice has to be in relation to investigation or trial and not matters  

falling beyond their scope. Once the accused is able to show that there  

has  been serious  prejudice caused to  him with respect  to  either  of  

these aspects, and that the same has defeated the rights available to  

him under legal jurisprudence, the accused can seek relief from the  

Court.  (Vide:  Nageshwar  Sh.  Krishna  Ghobe  v.  State  of  

Maharashtra, AIR 1973 SC 165; Shamnsaheb M. Multtani v. State  

of Karnataka, AIR 2001 SC 921;  State  by Police Inspector v.  T.  

Venkatesh Murthy,  AIR 2004 SC 5117;  Rafiq Ahmed @ Rafi  v.  

State of U.P., AIR 2011 SC 3114; Rattiram & Ors. v. State of M.P.  

through Inspector of Police, AIR 2012 SC 1485; Bhimanna v. State  

of  Karnataka,  AIR  2012  SC  3026;  Darbara  Singh  v.  State  of  

Punjab, AIR 2013 SC 840; and Union of India & Ors. v. Ex-GNR  

Ajeet Singh, (2013) 4 SCC 186).

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12. Be that as it may, in State of T.N. v. M.M. Rajendran, (1998)  

9 SCC 268, this Court dealt with a case under the provisions of Act  

1988, wherein the prosecuting agency had submitted a very detailed  

report before the Asanctioning Authority and on consideration of the  

same, the competent authority had accorded the sanction.  This Court  

found that though the report was a detailed one, however, such report  

could  not  be  held  to  be  the  complete  records  required  to  be  

considered  for  sanction  on application  of  mind to  the  relevant  

material on record and thereby quashed the sanction.   

13. In view thereof, the CBI - appellant herein, immediately issued  

circular dated 6.5.1999 to give effect to the observations made in the  

said judgment in M. M. Rajendran (Supra) and directed that all the  

investigating officers  to give strict adherence to the said observations  

made  by  this  Court.  The  CBI  manual  was  amended  accordingly,  

adding paragraph 22.16, wherein it was directed that in view of the  

said judgment in  M. M. Rajendran (Supra), it was imperative that  

alongwith SP’s report, the branches must send the  copies of all the  

relied upon relevant material “including the statements of witnesses  

recorded by the investigating officers under Section 161 Cr.P.C. as  

well  as  statements  under  Section  164  Cr.P.C.  recorded  by  the  

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Magistrate  to  the  authority  competent  to  grant  sanction  for  

prosecution”.   Further,  the  investigating  officer  concerned  shall  be  

deputed to the competent authority to produce the relevant material  

for perusal of the competent authority and this fact be recorded in the  

case diary of the case concerned.  Paragraph 22.16 of the CBI manual  

reads as under:

“On completion of investigation in a case covered in   item 22.15.1  and 22.15.2,  even  the  CBI  shall  send its   report to the administrative authority alongwith relevant   statements  of  witnesses  recorded  during  investigation   and the documents. The judgment of the Supreme Court   in State of T.N. v. M.M. Rajendran reported in (1998) 9   SCC  268  and  the  Circular  No.  21/33/98-PD  dated   6.5.1999  issued  by  the  Policy  Division  which  also   referred to in this regard.”

14. A Three-Judge Bench of this Court in Vineet Narain & Ors. v.  

Union of India & Anr., AIR 1998 SC 889 to prevent the erosion of  

the  rule  of  law,  issued  large  number  of  directions  to  various  

authorities. Relevant part of directions issued to CBI, reads:  

“59(12). The CBI Manual based on statutory provisions   of the CrPC provides essential guidelines for the CBI’s   functioning.  It  is  imperative  that  the  CBI  adheres   scrupulously to the provisions in the Manual in relation   to  its  investigative  functions,  like  raids,  seizure  and   arrests.  Any  deviation  from  the  established  procedure   should  be  viewed  seriously  and  severe  disciplinary   action taken against the officials concerned.”

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15. Thus from the above, it is evident that the CBI manual, being  

based on statutory provisions of the Cr.P.C., provides for guidelines  

which require strict compliance.  More so, in view of the fact that the  

ratio of judgment of this Court in M.M. Rajendran (Supra) has been  

incorporated in  the CBI  manual,  the  CBI  manual  itself  is  the  best  

authority to determine  the issue at hand. The court has to read the  

relevant provisions of the CBI  manual alone and no judgment of this  

Court can be a better guiding factor under such a scenario.  

16. The sanction order runs into 27 pages. The relevant part thereof  

reads as under:

"And whereas the Central Government, after fully and   carefully considering the material placed before him and   taking into account the available evidence, including the   case  diaries  and  documents  collected,  by  the   investigating  officer  during the  course  of  investigation   and statements of witnesses including the statements of   witnesses recorded by the investigation officer U/s 161   Cr.P.C.  and  statements  recorded  before  Magistrates   under  u/s  164  Cr.P.C.  with  regard  to  the  said   allegations  and  circumstances  of  the  case,  is  satisfied   that Shri Ashok Kumar Aggarwal should be prosecuted   in the  competent Court of Law for the abovementioned   offences  and  any  other  offences  if  made  out  on  these   facts,"            (Emphasis added)

17. Before proceeding further, it may be pertinent to note that the  

sanction order speaks of consideration of the entire material including  

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the  case  diaries  and  documents  collected  during  the  course  of  

investigation and statements recorded under Section 161 Cr.P.C. and  

statements recorded by the Magistrate under Section 164 Cr.P.C.  The  

learned Special Judge dealt  with the issue in its  order and brushed  

aside the same observing that the same may be factually incorrect,  

and there  was  a  letter  on  record  showing  the  true  picture  that  the  

relevant  documents had not  been sent  to the sanctioning authority.  

However, it is open to the prosecution during the course of trial to  

examine the sanctioning authority where such a  discrepancy can be  

explained. The learned Special Judge has wrongly labeled such a fact  

which goes to the root of jurisdiction and clearly shows that the extent  

to which there could be application of mind was a mere discrepancy.  

The relevant part of the order of the Special Judge reads:

   “The contents of Para 27 of the sanction order dated   26th  November,  2002  stating  that  the  case  diaries,   documents collected by the investigating officer during   the course of investigation, statements of witnesses under   Section  161 CrPC and under  Section  164 CrPC were   considered by the sanctioning authority may be factually   incorrect in  view  of  the  letter  dated  24th May,  2002,   written  by  the  DIG of  the  CBI,  which shows  that  this   document had not been sent. However, this statement by   itself at this stage cannot be construed s non-application   of mind by the sanctioning authority. If the charges are   framed against the accused and the case goes for trial   the  sanctioning  authority  shall  get  an  opportunity  to   explain the discrepancy.”                      (Emphasis added)  

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18. The High Court in the impugned judgment and order has taken  

a prima facie view that:

a) The CBI had not sent the complete record to the  

sanctioning authority.

b) The  order  dated  11.7.2007  passed  by  the  

Special Judge made it evident that the learned counsel  

appearing on behalf of the CBI had conceded before  

the  court  that  only SP’s  report  alongwith  list of  

evidence  (oral)  and  list of  evidence  (documentary)  

were sent to the sanctioning authority for the purpose  

of according sanction.   

c) The statement of witnesses and other relevant  

documents were not sent to the sanctioning authority  

as per the own case of CBI.

d) The  observation  in  the  sanction  order  dated  

26.11.2002  that  “the  case  diaries  and  documents  

collected  by  the  investigating  officers  during  the  

course of investigation, statements of witnesses under  

Section 161 Cr.P.C.  and under  Section 164 Cr.P.C.  

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were  considered  by  the  sanctioning  authority”  is  

factually incorrect.

e) The  aforesaid  facts  make  it  clear  that  the  

sanctioning  authority  had  not  considered  the  entire  

material available with the investigating agency.  

19. The High Court further held:

“30. In the present case, petitioner has raised objections   to the validity of sanction at the very initial stage, i.e.   even  before  arguments  on  charge  could  be  advanced.   However, the trial court has not recorded any finding in   terms of clause (b) of sub-section (3) and sub-section (4)   of  Section  19  of  the  Act,  that  non-production  of  the   relevant material before the sanctioning authority at the   time of grant of sanction "has not resulted in a failure of   justice".   31.  Under these circumstances, it would be appropriate   to require the trial court to record the findings in terms   of  clause  (b)  of  sub-section  (3)  and sub-section  (4)  of   Section 19 of the Act.   32. Hence, the impugned order,  passed by the learned   Special Judge is set aside and the matter is remanded   back to the trial court with direction to record a finding   in terms of clause (b) of sub-section (3) and sub-section   (4) of Section 19 of the Act. The trial court, if it deems fit,   for this purpose, can examine the sanctioning authority   as  a  witness  even  before  charge,  keeping  in  view the   provisions of Section 311 Cr.PC.”  

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20. The aforesaid concluding paragraphs of the judgment give rise  

to questions as to what is the proper stage to examine the issue of  

sanction; as well as relating to the applicability of the provisions of  

Section 19(3)(b) and 19(4) of the Act 1988.   

Section 19(1) reads as under:

“19.  (1)No court  shall  take  cognizance of  an  offence  punishable under sections 7, 10, 11, 13 and 15 alleged to  have been committed by a public servant, except with the  previous sanction --  (a) xx xx xx

(2) xx xx xx

(3) Notwithstanding anything contained in the Code of  Criminal Procedure, 1973 (2 of 1974)--  (a)  no  finding,  sentence  or  order  passed  by  a  special  Judge shall be reversed or altered by a Court in appeal,  confirmation or revision on the ground of the absence of,  or  any  error,  omission  or  irregularity  in,  the  sanction  required under sub- section (1), unless in the opinion of  that court, a failure of justice has in fact been occasioned  thereby;  (b) no court shall stay the proceedings under this Act on  the ground of any error, omission or irregularity in the  sanction  granted by the authority,  unless  it  is  satisfied  that such error, omission or irregularity has resulted in a  failure of justice” (c) xx xx xx

(4) In determining under sub- section (3) whether the absence  of, or any error, omission or irregularity in, such sanction has  occasioned or resulted in a failure of justice the court shall have  regard to the fact whether the objection could and should have  been  raised  at  any  earlier  stage  in  the  proceedings.  Explanation.-- For the purposes of this section,--  

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(a) error includes competency of the authority to grant sanction;  

(b) a sanction required for prosecution includes reference to any  requirement that the prosecution shall  be at the instance of a  specified authority or with the sanction of a specified person or  any requirement of a similar nature.”  

Sub-section  (4)  thereof  clearly  provides  that  the  question  of  

validity of sanction could be raised at an earlier stage of  proceedings.  

21. This  Court  considered  the  aforesaid  statutory  provisions  in  

Satya Narayan Sharma v. State of Rajasthan, AIR 2001 SC 2856  

and held as under:

“3. The prohibition is couched in a language admitting   of  no  exception  whatsoever,  which  is  clear  from  the   provision itself. The prohibition is incorporated in sub- section  (3)  of  Section  19  of  the  Act.  The  sub-section   consists  of three clauses.  For all  the three clauses the   controlling  non  obstante  words  are  set  out  in  the   commencing portion as:

“19. (3) Notwithstanding anything contained in  the Code of Criminal Procedure, 1973….” Hence none of the provisions in the Code could be   

invoked  for  circumventing  any  one  of  the  bans   enumerated in the sub-section.”

22. The letter dated 17.5.2005 written by the Addl. DIT (Vigilance)  

to  DIG,  CBI  makes  it  clear  that  the  documents  relied  upon  were  

voluminous and therefore, were not enclosed with the SP’s report.  It  

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further revealed that an order was passed by the High Court directing  

the  Revenue  Secretary  and  the  Director  (CBI)  to  examine  the  

grievance  of  the  respondent/accused  and  to  dispose  of  his  

representations in this regard.    

23. In Commissioner of Police v. Gordhandas Bhanji, AIR 1952  

SC 16, this Court held as  under:  

“We  are  clear  that  public  orders,  publicly  made,  in   exercise of a statutory authority cannot be construed in   the  light  of explanations  subsequently  given  by  the   officer making the order of what he meant, or of what   was in his mind, or what he intended to do. Public orders   made  by  public  authorities  are  meant  to  have  public   effect and are intended to affect the actings and conduct   of  those  to  whom  they  are  addressed  and  must  be   construed  objectively  with  reference  to  the  language   used  in  the  order  itself….…..Public  authorities  cannot   play fast and loose with the powers vested in them, and   persons to whose detriment orders are made are entitled   to  know  with  exactness  and  precision  what  they  are   expected to do or forbear from doing and exactly what   authority is making the order.”             (Emphasis added)

(See  also:  Mohinder  Singh  Gill  &  Anr.  v.  Chief  Election  

Commissioner,  New  Delhi  &  Ors.,  AIR  1978  SC  861;  and  

Chairman, All  India Railway Recruitment Board & Anr. v.  K.  

Shyam Kumar & Ors., (2010) 6 SCC 614).

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24. The  provisions  of  Sections  91  and  92  of  the  Evidence  Act  

provide that evidence may be led to invalidate a document itself. The  

best evidence as to the contents of a document is the document itself  

and it is the production of the document that is required by this section  

in proof of its contents.  Section 91 describes the “best evidence rule”,  

while Section 92 comes into operation for the purpose of excluding  

evidence  of  any oral  agreement,  statement  etc.,  for  the  purpose  of  

contracting or adding or subtracting from its terms. However, these  

sections differ in some material particulars.   

25. Charge sheet filed by the appellant, CBI against the respondent  

does not reveal that it had examined any witness to the effect that the  

relevant  documents  had  been  produced  before  the  sanctioning  

authority or the authority had asked for a document and the same had  

been shown to him.  

26. In the counter affidavit it has been stated by the respondent that  

there is no evidence on record to indicate that all material records had  

been separately examined by the Vigilance Wing of the department as  

permissible under Chapter VII of the Vigilance Manual.  Clause 18 of  

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the Manual enables the accused to make a representation to withdraw  

the prosecution. The relevant part thereof reads as under:  

“18.1.  Once a case has been put in a court, it should be   allowed  to  take  its  normal  course.  Proposal  for   withdrawal of prosecution may  however, be initiated by   the  S.P.E.  on  legal  consideration.  In  such  cases  the   S.P.E.  will  forward  its  recommendations  to  the   Department of Personnel and Training in cases in which   sanction for prosecution was accorded by that Ministry   and  to  the  administrative  Ministry  concerned  in  other   cases.  The  authority  concerned  will  in  all  such  cases   consult the Ministry of Law and accept their advice.   18.2.   Requests for withdrawal of prosecution may also   come  up  from  the  accused.  Such  requests  should  not   generally be entertained except in very exceptional cases   where, for instance, attention is drawn to certain fresh,   established or accepted facts which might alter the whole   aspect of the case. In such cases also the administrative   Ministry concerned should consult the Ministry of Law  and accept their advice.”   

27. The  respondent  had  given  a  representation  on  13.3.2003  

making various averments,  inter-alia, that there was no evidence to  

indicate  that  the  relevant  material/record  had  been  separately  

examined  by  the  Vigilance  Wing  of  the  department,  and  for  the  

verification  of  which  the  Finance  Minister  had  requisitioned  the  

records. The appellant, CBI brushed aside the said representation  on  

the pretext that the issue of validity of sanction was sub-judice.   

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28. It  has  further  been averred  therein  that  before  the  court,  the  

Special PP of CBI has stated that no relevant material had been placed  

before the sanctioning authority except the SP’s report as is evident  

from the order dated 11.7.2007. The relevant part of the order reads as  

under:

“It is conceded by Shri N.K. Sharma, Ld. Special PP that   only SP’s report alongwith list of evidence oral and list   of  evidence  documentary  were  sent  to  the  sanctioning   authority for the purpose of according sanction.”

29. The representation made by the respondent was considered at  

various  levels.  The  letter  written  by  Shri  Rakesh  Singh,  Joint  

Secretary  (Revenue)  to  the  Director  General  of  Income  Tax  

(Vigilance) with a copy of the same to the Chairman, CBDT stated  

that in  order to consider the representation of the respondent, it was  

necessary that the concerned records including those of the Income  

Tax Department for the relevant period be requisitioned from the CBI  

and examined by the Vigilance Wing of the Income-Tax Department  

and the finding of such examination be sent to him within 10 days,  

based on which a final view could be taken on the representation of  

the respondent.  

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30. The  letter  dated  17.5.2004  by  Shri  B.P.S.  Bisht,  Additional  

DIT(V) HQ, CBI revealed that as in the representation, the respondent  

had averred that all relevant material had not been placed before the  

sanctioning  authority,  it  was  necessary  for  the  CBI  to  provide  all  

relied upon documents, as referred to in the letter dated 24.5.2002, as  

also the relevant income tax records which were in the CBI custody to  

enable  compliance  of  the  directions  received  from  the  Revenue  

Secretary. In case it was not possible to provide the original records as  

above, authenticated copies thereof be given, treating it to be a matter  

of utmost urgency.  

31. The  DIG,  CBI  vide  its  letter  dated  5.6.2004  informed  Shri  

B.P.S. Bisht that it was not possible to send the record. The matter  

was  pending consideration in  the trial  court  and as such was  sub-

judice.    

32. The covering letter of the draft sanction dated 24.5.2007 does  

not make it clear as to what had been sent to the sanctioning authority.  

It reveals that alongwith the draft sanction order, a list of witnesses  

and list of documents had been sent. The relevant part thereof reads as  

under:

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 “The SP’s report sent herewith may please be treated   as a secret document and no reference to it may be made   in  the  sanction  order  when  issued.   In  case  the   Ministry/Department,  due  to  some  reasons  wants  to   depart  from the material  placed on record  for  issuing   sanction,  the matter  may please be discussed with the   undersigned  so  that  the  sanction  for  prosecution  so   accorded not found wanting legally.

Since the relied upon documents are very large in   quantity, they are not being enclosed. The Investigating   Officer  of  this  case  Shri  V.K.  Pandey,  will  show  the   documents and also explain the evidence as and when   required.  Further  List  of  witnesses  and  List  of   documents will be provided, if necessary.”

                                                                          (Emphasis added)

Thus, it is evident that even on the date the draft sanction was  

sent, the investigation was not complete.  

33. It  appears  from  the  facts  and  figures  given  in  the  report,  

particularly  from the  Income  Tax  returns/assessment  orders  of  the  

respondent  and his  family members,  that  there has not  been a fair  

assessment regarding the income of the respondent and other family  

members as shown by them in their income-tax returns and it is far  

from satisfaction,  as is evident from the preliminary enquiry report  

dated  17.9.1995.  Same  remained  the  position  regarding  the  

assessment of the value of the apartments purchased by the respondent  

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at  Barakhamba  Road,  New  Delhi,  if  compared  with  the  property  

purchased by the Indian Oil Corporation in the same locality.  

34. The judgment delivered by the Delhi High Court in the case of  

Vijay Aggarwal, brother of the respondent, in Writ Petition (Crl.) No.  

675 of 2001 against the officers of the CBI impleading them by name,  

make it evident that very serious allegations had been made against  

the said officers of having acted with oblique motive to force him to  

ensure  that  his  brother  Ashok  Kumar  Aggarwal  withdraws  the  

complaint filed by him against them under Section 340 Cr.P.C. The  

court ultimately held that investigation had not been conducted in a  

fair manner.  The order passed therein reads:  

“33. In the result,  the  petition is  partly  allowed.  The   Special  Cell  of  Delhi  Police  is  directed  to  register  an   FIR  on  the  basis  of  the  allegations  contained  in  the   present petition and the complaint of the petitioner dated   23.2.2004  addressed  to  the  Commissioner  of  Police,   Delhi  and  take  up  the  investigation  of  the  case.  The   investigation shall be conducted by an officer not below   the rank of Assistant Commissioner of Police in the said   Cell independently and uninfluenced by the findings and   observations  contained  in  the  report  of  enquiry  dated   26.4.2005 conducted by the Joint Director, CBI and shall   endeavour  to  conclude  the  investigation  expeditiously   within a period of two months from the date of this order   and  shall  file  a  status  report  in  the  court  on  5 th  September, 2006.”

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35. Another Writ Petition (Crl.) No. 738 of 2001 was filed by Shish  

Ram Saini,  Chartered  Accountant  against  the  CBI  and  its  officers  

making allegations  against  them that  he  had been  harassed  by the  

CBI’s officers as he was employed as an Accountant in the firms and  

companies of respondent herein. The court held that the authorities  

had  proceeded  with  high-handedness  and  found  substance  in  the  

allegations made by the petitioner therein.  The order runs as under:  

“31. In view of the above discussion and in the result,   the present petition is partly allowed and the Special Cell   of Delhi Police is directed to register a case on the basis   of allegations contained in the complaint dated 5.7.2001   lodged by the petitioner with police station Lodhi Colony   and  those  contained  in  the  present  petition.  The   investigation shall be conducted by an officer not below   the rank of Assistant Commissioner of Police in the said   Cell independently and uninfluenced by the findings and   observations  contained  in  the  report  of  enquiry  dated   26.4.2005  conducted  by  the  Joint  Director,  CBI.”      

36. The record reveals that VIP reference was made by the Ministry  

of  Finance  to  the  Law Ministry  in  respect  of  the  case  against  the  

respondent as the matter had been agitated by one Hon’ble Member of  

the Parliament and the Law Ministry gave its opinion.  The salient  

features  thereof  are  that  the  sanction  had  been  accorded  without  

considering and examining the relevant material as the same had  not  

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been sent by the CBI and even thereafter despite being requested by  

the Vigilance Department of CBDT, the Vigilance, CBI did not send  

the relied upon documents to the authorities.  

37. Similarly, it is also evident from the records that the Ministry of  

Finance, Department of Revenue had written a letter dated 11.3.2011  

to  the  Law  Department  seeking  the  said  opinion  and  earlier  the  

Directorate General of Income Tax (Vigilance) had also sent a letter  

to  the  Law  Ministry  seeking  its  opinion.  Thus,  the  concerned  

authorities had sought legal opinion of the Law Ministry on the issue.

38. The CVC Manual provides that opinion of the Law Ministry  

was to be accepted by the other departments in such cases.  

However, the respondent claims that the said legal opinion was  

subsequently withdrawn.  Whether the legal opinion could be validly  

withdrawn  or  not  can  be  considered  by  the  trial  court  while  

considering the validity of the sanction.  

39. It  may also be pointed out that  after the impugned judgment  

was passed, the Special Judge in order to ensure compliance thereof,  

dealt with the case on 12.10.2007 and directed:  

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“Let the sanctioning authority be produced on 3.11.2007.”  

It was on the suggestion made by Special Public Prosecutor for  

CBI that the court issued summon to the sanctioning authority. The  

order sheet dated 3.11.2007 further reveals that after passing of the  

order and signing the same, the matter was again taken up at  2.00  

P.M., wherein the affidavit purported to have been given by the then  

sanctioning authority was taken on record and it was directed that the  

matter be listed on 20.11.2007.   

40. The relevant part of the affidavit filed by the then sanctioning  

authority dated 3.11.2007 reads as under:  

“4.   I confirm the statement of facts in Paragraphs 8 and   24  of  the  order  of  the  Hon’ble  High  Court.   No   statements  of  witnesses  or the documents relied in  the   charge-sheet  are  ordinarily  forwarded  to  the  Finance   Minister  of  the  day.   What  is  sent  is  a  draft  order,   whereafter  sanctioning  by  the Minister  in  normally  a   routine acceptance of that draft.  What was considered   by me was only that which was sent or recommended to   me.  5. If the obligation was to consider more than which   was  sent,  then  that  has  not  been  done,  therefore,   unwittingly prejudice might have been caused and justice   miscarried.  I leave it to the Court to decide the matter.”  

41. The aforesaid affidavit, whatever may be its evidentiary value  

and without going into technicalities such as the issue of whether it is  

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admissible in evidence or not or whether it may be considered at a  

later stage, one thing is clear that it is in consonance and confirmation  

of the findings recorded by the High Court in paragraphs 8  and 24 of  

the impugned judgment.  Paragraph 8 of the judgment reads as under:  

“8. Further,  it  is  contended  that  the  charge  sheet   relies upon 366 witnesses,  whereas the list  annexed to   the  SP’s  report  mention  only  278  witnesses.   88   witnesses  were  not  even mentioned in  the list  and the   statement  of  not  even  a  single  witness,  out  of  366   witnesses  was  sent  to  the  sanctioning  authority.   Moreover,  the charge  sheet  refers  to  1220 documents,   whereas the list attached to the SP’s report only mention   282  documents.   Thus,  938  documents  were  withheld   from  the  sanctioning  authority  including  documents   consisting  of  income tax  record  of  the  petitioner.  The   Apex  Court  has  held  in  DSP  Chennai  v.  K.   Inbasagaran, (2006) 1 SCC 420 that:

“Income tax return and assessment  orders   are  relevant  in  a case  of  disproportionate   assets.”

Paragraph 24 mentioning relevant part of sanction order  has already been quoted hereinabove.”   

42. Thus,  it  becomes  crystal  clear  that  the  statements  of  28  

witnesses were not even mentioned in the SP’s report. Similarly, there  

was no reference to the 938 documents in the said report and there had  

been no reference to the income tax returns and assessment orders so  

far the respondent and his family members were concerned therein.    

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43. The  present  special  leave  petition  was  drawn/drafted  on  

20.11.2007  and  filed  thereafter.  Interim  order  was  granted  by  this  

Court on 10.12.2007.  In the special  leave petition it has not been  

disclosed that the Special Judge, after remand, entertained the matter  

and issued summons to  the then sanctioning authority i.e. Hon’ble  

Finance  Minister,  and  in  response  thereto,  an  affidavit  dated  

3.11.2007 had been filed by the then sanctioning authority, disclosing  

that no material had been considered by him while granting sanction.  

However, leaving the issue open as to what prejudice had been caused  

to the respondent, it is apparent that all the material facts had not been  

disclosed in the special leave petition. Thus, the appellant suppressed  

some of the most material facts from this Court.   

44. Section 19(3) of the Act, 1988 puts a complete embargo on the  

court to grant stay of trial/proceedings.

In Selvi J. Jayalalithaa & Ors. v. State of Karnataka & Ors.,  

JT 2013 (13) SC 176, this court while dealing with the scope of power  

under Article 142 of the Constitution held that the court cannot pass  

an order in contravention of the statutory provisions:   

"28.1  The powers under Article 142 of the Constitution   stand on a wider footing than ordinary inherent powers   

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of  the  court  to  prevent  injustice.   The  constitutional   provision has been couched in a very wide compass that   it  prevents  "clogging  or  obstructing  of  the  stream  of   justice." However, such powers are used in consonance   with the statutory provisions.”             (emphasis added)  

(See also:  Teri Oat Estates (P) Ltd. v. UT, Chandigarh & Ors.,  

(2004)  2 SCC 130,  Manish Goel  v.  Rohini  Goel,  AIR 2010 SC  

1099, and State of Uttar Pradesh v. Sanjay Kumar, (2012) 8 SCC  

537).

45.      This court passed the interim order in contravention of the  

provisions of Section 19 of the Act 1988. Though the appellant claims  

that  it  did not  ask for  such order,  the court  itself  granted the stay.  

Even the respondent never applied for vacating the said interim order.  

In such a fact-situation, it is not desirable to make any comment on  

the issue.  

46. The most relevant issue involved herein is as at what stage the  

validity of sanction order can be raised.  The issue is no more  res-

integra. In  Dinesh Kumar v. Chairman Airport Authority of India  

& Anr., AIR 2012 SC 858, this Court dealt with an issue and placing  

reliance upon the judgment in Parkash Singh Badal & Anr. v. State  

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of Punjab & Ors.,  AIR 2007 SC 1274,  came to the conclusion as  

under:  

“13. In our view, having regard to the facts of  the   present  case,  now  since  cognizance  has  already  been   taken against the appellant by the trial Judge, the High   Court  cannot  be  said  to  have  erred  in  leaving  the   question of validity of sanction open for consideration by   the trial court and giving liberty to the appellant to raise  the  issue  concerning  validity  of  sanction  order  in  the   course of trial. Such course is in accord with the decision   of this Court in Parkash Singh Badal…”

47. Undoubtedly, the stage of examining the validity of sanction is  

during the trial and we do not propose to say that the validity should  

be examined during the stage of inquiry or at pretrial stage.

48.  However,  in  the  instant  case,  the  fact-situation  warrant  a  

different course altogether as the impugned order had already been  

partly complied with before filing the petition before this Court.  The  

appellant admittedly did not disclose the material facts in this petition.  

Had the said facts been disclosed perhaps this Court would not have  

entertained this petition and the matter could have been concluded by  

the Trial Court much earlier.  The affidavit filed by the sanctioning  

authority  may  tilt  the  balance  in  favour  of  the  respondent  if  duly  

supported by the deponent and not disclosing the material  fact  i.e.  

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filing  of  such  an  affidavit  by  the  sanctioning  authority  before  the  

Special  Judge,  indicates  serious  and  substantial  prejudice  to  the  

respondent. The material on record reveals that it could be a case of  

serious  prejudice  to  the  respondent  so  far  as  the  decision  making  

process  by  the  sanctioning  authority  is  concerned.   The benefit  of  

interim  protection  granted  in  favour  of  the  appellant  where  the  

appellant has not disclosed the material facts, should be neutralized.   

49. We  do  not  find  any  force  in  the  submission  made  by  Shri  

Jethmalani, learned senior counsel that as the matter is about one and  

a half decade old and the respondent has already suffered because of  

protracted legal proceedings at various stages before different forums,  

it is warranted that prosecution against him be closed altogether.  This  

Court has consistently held that no latitude  can be given in the matter  

of corruption.  (Vide:  C.S. Krishnamurthy v. State of Karnataka,  

AIR 2005  SC  2790)  wherein  contrary  view  had  been  taken  from  

Mansukhlal Vithaldas Chauhan v. State of Gujarat, AIR 1997 SC  

3400.   

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50. In view of the above, we are of the considered opinion that the  

peculiar  facts  and  circumstances  of  the  case  do  not  warrant  any  

interference and the appeal is dismissed.  

However, before parting with the case, we clarify that the trial  

court will proceed without being influenced by any observation made  

hereinabove as we have considered the facts of the case only to decide  

this appeal. In the facts and circumstances of the case, as the matter  

remained pending before the court  for  a long time, we request  the  

learned Special Judge to proceed with the matter from the stage when  

the stay operated and conclude the same at the earliest.   

.........................………………..J.                                                 (DR. B.S. CHAUHAN)

                                                        .............………………………J.                    (S.A. BOBDE)

New Delhi, November 22, 2013  

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