J Krishna Kishore vs The State Of Andhra Pradesh
2022 Latest Caselaw 3943 AP

          THE HONOURABLE SRI JUSTICE D.RAMESH

             CRIMINAL PETITION NO.7847 OF 2019

ORDER:

1. This Criminal Petition is filed under Section 482 Cr.P.C.

seeking quashing of FIR in Cr.No.22/2019 dated 15.12.2019

registered on the file of CID Head Quarters PS, Mangalagiri, under

Sections 188, 403, 409, 120(B) IPC and AP Economic Development

Board Act 2018.

2. Heard Sri Naga Muthu, learned senior counsel appearing on

behalf of Sri J.V.Prasad, learned counsel for the petitioners and Sri

T.M.K.Chaitanya, Standing Counsel for CID, appearing for the

respondent-State.

3. The case of the petitioner is that the petitioner is a Chartered

Accountant by qualification till he was selected in Indian Revenue

Service in 1991. He was posted as Assistant Commissioner of

Income Tax, Bangalore in 1993 and continued till November, 1998.

His performance during this tenure was rated as outstanding.

Thereafter the petitioner was posted as a Senior Technical Officer,

Central Economic Intelligence Bureau, New Delhi from November

1998 to till 30.09.1999. Pursuant thereto, the petitioner was on

deputation as Principal Secretary to the Union Minster of State for

Agriculture and Union Minister for Rural Development. During the

period from September 2003 till January 2012, the petitioner was

worked as Additional commissioner of Income Tax in Faridabad,

Chandigarh and Hyderabad, thereafter promoted as the

Commissioner of Income Tax w.e.f.26.01.2012 and posted in

Vijayawada and Guntur, after which he was taken on deputation

as Private Secretary to the Union Minister for Civil Aviation,

Government of India between 02.06.2014 till 31.03.2015.

4. In view of the requirements of the State of Andhra Pradesh,

the petitioner owing to his outstanding career and large experience

was requested by the State of Andhra Pradesh to make available

his services on deputation as the Chief Executive Officer (CEO) of

the APEDB with the Grade of Special Secretary to the state of

Andhra Pradesh. The petitioner having expressed his willingness

to serve the state, the State of Andhra Pradesh vide letter dated

05.05.2015 requested the Ministry of Civil Aviation, Government of

India to allow him to join the State Government after approval of

Competent authority and the same was acceded to. Thereafter, the

Government of Andhra Pradesh took cadre clearance from the

Ministry of Finance, Government of India to enable the petitioner to

work on deputation as special Secretary. Thus, the petitioner was

appointed on the aforesaid possession for a period of three years,

from 28.08.2015 till September 2018. In view of the remarkable

performance of the petitioner as the CEO of the APEDB, the State

of AP requested the petitioner to continue on deputation for the

further period of 2 years i.e., from 30.08.2018 till 28.08.2020.

Every action taken by the APEDB has to be approved by the Board,

which also has internal auditors, who are Chartered Accountants

of a reputed firm.

5. Further submitted that the vide letter dated 24.05.2019

requested the Government of Andhra Pradesh to relieve him from

the Government of Andhra Pradesh so as to enable him to be

repatriated back to his present department. The petitioner after

the elections in 2019 in the State of Andhra Pradesh and the

consequent formation of the new Government on 30.05.2019 was

meted with hostile attitude and as a consequence of it, the

petitioner was transferred to the General administration

Department without any posting and salary. On 12.12.2019 the

petitioner was promoted as the Principal Commissioner of Income

Tax vide Order No.253/2019 dated 12.12.2019, within the hours of

the issuance of the promotion letter, the petitioner was suspended

by the State of Andhra Pradesh on the same date i.e., 12.12.2019

on account of alleged irregularities committed during the period

the petitioner was the CEO of the APEDB by referring to a report of

the Industries, Infrastructure, Investment and Commerce

Department which had nothing to do administratively with APEDB.

The aforesaid act of the State Government was malafide and done

with the sole intention of ruining the reputation, life and career of

the petitioner and to scuttle his future promotion and prospects in

career.

6. Aggrieved by the suspension order in G.O.RT.NO.2814 dated

12.12.2019, the petitioner filed an application before the Central

Administrative Tribunal, Hyderabad and on 16.12.2019 the

Tribunal was pleased to suspend the order of the suspension.

Having came to know that the petitioner was approaching the

Central Administrative Tribunal against the order in

G.O.RT.No.2814, dated 12.12.2019, the State of Andhra Pradesh,

with a malafide intention, got filed a complaint on 15.12.2019 and

registered the impugned FIR dated 15.12.2019 alleging violation of

norms of financial property by the petitioner in dealing with

procurement, payment of advances, audit and accounting

procedures during the period, the petitioner was working as the

CEO of the APDEB. It is further alleged in the FIR that the

petitioner recruited close confidants at very high salaries without

following the due procedure and through irregular advertisements

causing loss to the Government exchequer.

7. The petitioner further stated that the aforesaid actions are an

outcome of vengeful attitude of the State of Andhra Pradesh and

that the petitioner happened to be the supervisory officer of the

Assessing Officer in the case of Jagathi Publications, owned and

controlled by the present Chief Minister of the State of Andhra

Pradesh, considering the escapement of income, and large scale

evasion of Tax through bogus share premium, Assessing Officer

made the additions and disallowances in terms of law under the

Income Tax Act in the hands of Jagathi Publications. The said

order was also upheld by the CIT (A). Thus, passing of an order

against Jagathi Publications was taken personally and since June

2019, the State Government has left no stone unturned to wreck

vengeance against the petitioner.

8. Further it is contended that the APEDB was not run by one

CEO but by a Board consisting of 21 members with the Hon'ble

Chief Minister as the Chairman and several other Cabinet

Ministers, Chief Secretary and Special Chief Secretaries to the

Government of Andhra Pradesh along with the CEO. The decisions

of the APEDB were taken by the Board collectively with the

approval of the Members of the Board. In view of the same, making

allegation solely against the petitioner and one other person in the

impugned FIR smacks of malafide and arbitrary exercise of

discretion by the State of Andhra Pradesh.

9. That the procurement in the APEDB was made through a

transparent mechanism having a three quotation system wherein

the procurements were made through the lowest bidder

considering its capacity and capabilities. Whenever, the value of

procurement was high, the tendering procedure was followed

through newspaper advertisements and also where the

Government vendors were available and they agreed to the

payment terms and other conditions, procurements were made

though such vendors.

10. With regard to the payment of advances, such advances were

made in the normal business practice where the Board gets the

advantage of rolling credit, in case, the vendor is a regular supplier

and bills are huge where reconciliation will take considerable time.

Furthermore, the advances are also released by the APEDB

whenever there was foreign travel pertaining to the Hon'ble Chief

Minister and/or the delegation of Ministers and their officers and

supporting team participating in foreign events. There was no

irregularity in the payment of advances during the period when the

petitioner was CEO of APDEB. However, all the decisions were

the collective decisions of the Board and as per norms.

11. Further it is submitted by the petitioner that as far as

advertisements are concerned the same were released through

accredited advertising agencies recognized by I&PR. The rates for

advertisements are released by I & PR regularly and no

organization can pay over and above these rates. Thus the

allegation of irregular expenditure does not hold any ground and is

made solely with the intention to harass the petitioner.

Furthermore, the allegation that high salaries were paid to close

confidants is preposterous in as much as the recruitment was

made through transparent process by the Board and the salaries

were paid in terms of the rules.

12. Based on the above averments, the learned senior counsel,

Sri Naga Muthu made the following submissions:

The offence of Section 403 IPC does not attract as the basic

ingredients, i.e., dishonest misappropriation of property and

misappropriation of such property to his own use by the accused

and dishonest intention on the part of the accused. None of the

ingredients are attracted in the facts of the present case against

the petitioner and no mention in the FIR as to which property and

in what manner that was dishonestly misappropriated. In support

of his contention the petitioner relied on the following judgment:

Indian Oil Corporation v. NEPC India Ltd & Ors1- Basic ingredients to attract the offence under 403 IPC

13. The allegation under Section 409 IPC does not attract as the

FIR fails to disclose as to what property was entrusted with the

petitioner by the complainant and for the benefit of whom. To

support his contention, the petitioner relied on the citation in Robert

John D'souza & Ors. V. Stephen V.Gomes & Anr2, wherein the term

entrustment has been explained by the Hon'ble Supreme Court.

14. The Offences under Sections 188 and 120B IPC are also not

attracted as there is no allegation with regard to the petitioner

entering into a criminal conspiracy with the other accused to

(2006) 6 SCC 736

. (2015) 9 SCC 96

commit an offence and also there is no allegation of disobedience to

an order promulgated by public servant in the present case.

15. Further learned senior counsel contended that APEDB is run

by a Board consisting of 21 members with the Hon'ble Chief

Minister as the Chairman and other members, where CEO is one of

them. The decisions were taken by the board collectively after the

approval of the members of the board. Hence making allegation

solely against the petitioner and one other person in the impugned

FIR smacks malafide and arbitrary exercise of discretion by the

State of Andhra Pradesh.

16. During the course of proceedings, on 19.12.2019 this court

passed interim direction in I.A.No.02 of 2019, granting liberty to

the police to continue with their investigation and the petitioner

shall also cooperate with the investigation. Further the

respondent-police are also directed not to take any coercive action

whatsoever against the petitioner, including his arrest.

17. The 2nd respondent has filed counter and vacate stay petition

stating that in obedience to the guidelines laid down by the Hon'ble

Apex Court in Lalita Kumar Vs. Govt. Of U.P., the SHO, the CID

Police Station registered the complaint dated 15.12.2019 filed by

Smt.Potluri Tulasi Rani, Special Grade Deputy Collector, APEDB,

Vijayawada as a case in Crime No.22 of 2019. During the course of

investigation many witnesses were examined and collected

important document, account books, ledgers, vouchers computer

hardware, emails etc., from various places and persons in this

case.

18. Further it is submitted that the respondent has followed

every legal procedural and substantive requirement relevant to the

investigation and carried out the same in an impartial manner.

The petitioner, as noticed by this Court in its order dated

19.12.2019 cited the case of Lalitha Kumari Vs. State of Utta

Pradesh and Ors.3 to make the argument that a preliminary

enquiry was necessary for the registration of an FIR against the

petitioner. However, as it was noted by the Supreme Court in the

State of Telangana Vs. Sri Managipet @ Managipet Sargveshwar

Reddy (2109) 19 SC 87, the Laitha Kumari's case does not make it

mandatory to conduct a preliminary investigation before registering

an FIR, Rather, it says that on receipt of information pertaining to

the commission of a cognizable offence if a prima facie case

pertaining to a cognizable offence is made out, the police is

required to set the investigating machinery in action by filing an

FIR. The purpose of the preliminary enquiry is to make out

whether a prima facie case is made out with respect to the

information received by the police when it is necessary. In this

case the prima facie case could be made out on the basis of the

information received by the respondent without the need for a

preliminary enquiry.

19. The aforementioned position of law is made clear in the

following excerpt from The State of Telangana V Sri

Managipet @ Managipet Sarveshwar Reddy4 which refers

(2014) 2 SCC 1

(2010) 19 SCC 87

to the judgment by the constitutional bench in Lalitha Kumari's case

cited supra and held as follows:-

"28. In Lalita Kumari, the Court has laid down the cases in which a preliminary inquiry is warranted, more so, to avoid an abuse of the process of law rather than vesting any right in favour of an accused. Herein, the argument made was that if a police officer is doubtful about the veracity of an accusation, he has to conduct a preliminary inquiry and that in certain appropriate cases, it would be proper for such officer, on the receipt of a complaint of a cognizable offence, to satisfy himself that prima facie, the allegations levelled against the accused in the complaint are credible. It was thus held as under:-

"73. In terms of the language used in Section 154 of the Code, the police is duty bound to proceed to conduct investigation into a cognizable offence even without receiving information (i.e. FIR) about commission of such an offence, if the officer in charge of the police station otherwise suspects the commission of such an offence.

The legislative intent is therefore quite clear, i.e., to ensure that every cognizable offence is promptly investigated in accordance with law. This being the legal position, there is no reason that there should be any discretion or option left with the police to register or not to register an FIR when information is given about the commission of a cognizable offence. Every cognizable offence must be investigated promptly in accordance with law and all information provided under Section 154 of the Code about the commission of a cognizable offence must be registered as an FIR so as to initiate an offence. The requirement of Section 154 of the Code is only that the report must disclose the commission of a cognizable offence and that is sufficient to set the investigating machinery into action."

29. The Court concluded that the registration of an FIR is mandatory under Section 154 of the Code if the information discloses commission of a cognizable offence and no preliminary inquiry is permissible in such a situation. This court held as under:

"111. In view of the aforesaid discussion, we hold:

i) Registration of FIR is mandatory under Section 154 of the Code, if the information discloses commission of a cognizable offence and no preliminary inquiry is permissible in such a situation.

ii) If the information received does not disclose a cognizable offence but indicates the necessity for an inquiry, a preliminary inquiry may be conducted only to ascertain whether cognizable offence is disclosed or not.

iii) If the inquiry discloses the commission of a cognizable offence, the FIR must be registered. In cases where preliminary inquiry ends in closing the complaint, a copy of the entry of such closure must be supplied to the first informant forthwith and not later than one week. It must disclose reasons in brief for closing the complaint and not proceeding further.

iv) The police officer cannot avoid his duty of registering offence if cognizable offence is disclosed. Action must be taken against erring officers who do not register the FIR if information received by him discloses a cognizable offence.

v) The scope of preliminary inquiry is not to verify the veracity or otherwise of the information received but only to ascertain whether the information reveals any cognizable offence.

vi) As to what type and in which cases preliminary inquiry is to be conducted will depend on the facts and circumstances of each case. The category of cases in which preliminary inquiry may be made are as under: a) Matrimonial disputes/ family disputes b) Commercial offences

c) Medical negligence cases) Corruption cases."

30. It must be pointed that this Court has not held that a preliminary inquiry is a must in all cases. A preliminary enquiry may be conducted pertaining to Matrimonial disputes/family disputes, Commercial offences, Medical negligence cases, Corruption cases etc. The judgment of this court in Lalita Kumari does not state that proceedings cannot be initiated against an accused without conducting a preliminary inquiry."

20. It is further contended that the respondent has not

erred by not conducting the preliminary enquiry, but has rather

acted in accordance with the law by registering the FIR on

receipt of information that made out a prima facie case for

various serious offences.

21. Further contended that the petitioner argued that

Section 403 IPC, which the petitioner is accused of violating is only

applicable to "immovable property". However, a simple reading of

the section shows that it is emphatically not the case.

Section 403 IPC deals with Dishonest misappropriation of property:

--Whoever dishonestly mis-appropriates or converts to his own use any movable property, shall be punished with imprisonment of either description for a term which may extend to two years, or with fine, or with both.

22. Thus, it is submitted that Section 403 is in fact applicable to

the facts made out pertaining to the acts of misappropriation of

public funds sought to be proved against the petitioner.

23. Replying to the contention of the petitioner that referring to

the Charge of Section 409 IPC in the FIR, the petitioner argued

before this Court that no property was entrusted to him for there

to have been breach of trust or criminal misappropriation, the

respondent submits that the petitioner was in his position as a

public servant in the form of being the CEO of the Andhra Pradesh

Economic Development Board, given dominion over the funds and

budget of the department, which he dishonestly misappropriated,

converted to his own use and disposed of in ways other than the

mode prescribed by law. Thus, it is submitted that contrary to the

allegations of the petitioner, the application of Sections 406 and

409 are well-founded.

24. Further it is submitted in their counter that despite

this Court's order that the petitioner was to cooperate with the

investigation, which the Court had granted the petitioner liberty to

continue, the petitioner has repeatedly and consistently failed to

cooperate with the investigation. Hence, an order under Section

41-A Cr.P.C. was issued to the petitioner on 11.09.2020 to compel

his presence before the Investigating Officer in order to proceed

with the investigation, whereas the petitioner complied the same

nominally, in such a manner he could have been said to have

appeared before the Investigating Officer as he was legally bound to

do, but in a way that allowed him to evade meaningfully

contributing to the investigation of the case against him, the

subject matter of which is highly voluminous. He appeared before

the Investigating Officer only for few hours, after which he left the

state citing that he had already book a flight ticket due to prior

commitments. Subsequent notice under section 41-A Cr.P.C. was

issued to the petitioner on 06.02.2021, but he refused to comply

claiming that he was pre-occupied with work commitments, thus

the petitioner has abused the interim order granted to him by this

court. Further submitted that the respondent has acted with

"undue haste" in investigating the case and prays to vacate the

interim order.

25. During course of proceedings, the respondent-CID filed

additional counter affidavit, stating that the petitioner moved this

petition seeking to quash the FIR, wherein this court granted

interim order, directing the Investigation agency not to take

coercive steps against the petitioner in respect of his arrest and

liberty is granted to the police to continue with their investigation

and the petitioner shall also cooperate with the investigation.

Whereas the petitioner failed to oblige the order of this Court, by

not cooperating the investigation in all aspects with his arrogance

and without respect towards law even though repeated notices

under section 41-A Cr.P.C. issued against him. Further contended

that during the course of investigation, on 02.03.2021 Sri

M.Venakteswsra Rao, Special Consultant, APEDB formerly worked

as Special Deputy Collector (Retd.,) presented a report along with

the report of the Sri Gollanapalli Devi Prasad, Consultant APEDB

about finding of 20 booklets parcel in cloth bag, and on its opening

they found that those books seems to be party propaganda

material for a political party and also found one invoice copy of a

letter addressed to the then CEO i.e., the petitioner/accsued-1 and

according to the available records of evidence, it was established

that, during the tenure of the petitioner as CEO, APEDB an

amount of Rs.1.78 Crores were paid to the New Indian Express

Group, New Delhi, in order to publish adds in Sunday Standards

New Delhi and also issued proceedings with his signatures. In this

work endorsement/bid, several letter correspondences have been

occurred, in which, one advertising agency namely Eventxpress

addressed a letter to Mr.J.Krishna Kishore, Chief Executive Officer,

Economic Development Board, Government of Andhra Pradesh,

Vijayawada- 520002 on 20.02.2019. In the said letter under

heading of advertising Logistic: Annexure 1 "As a complimentary to

the above we shall be giving you 50,000/- copies of 50-pages book

in Telugu only, Will be printed under your supervision in Hyderabad.

Editorial, other information and pictures of the books will be

provided by you. Books will be delivered to you and the printer will

distribute the books as per your requirements and instructions at his

own cost. Please note that we have already designed edited and

written 52 pages of book earlier to be printed in English. In view of

the New Proposal suggested by you we shall not be printing English

version of the book." It clearly establishes that, in view of ensuring

general election in the month of April/May 2019 the

petitioner/accused 1 in order to gain the confidence of political

bosses, benefited a political party and thus he pleased the then

Chief Minister of the state and by flouting all the procedures and

rules for his whims and fancies Sri Jasthi Krishna Kishore being

the CEO, APEDB, by doing so to consolidate his position in the

organization as unquestionable Chief, entered into a malicious

quid-pro-quo agreement with M/s.Even Express Management

Services Pvt. Ltd. Without following financial rules.

26. It is further submitted that basing on the strength of

evidence, as the provisions of Act is attracting, the investigation

agency has submitted a proposal to the Government of A.P. to

accord permission under Section 17 (b) of IPC (Amendment) Act

2018 to investigate the case including the provisions of Corruption

Act, as there is prima facie of evidence for the offence under section

13(1) (a) Prevention of Corruption (Amendment) Act, 2018 made

out against the petitioner/accused-1. On 04.03.2021 vide memo

No.106487/SC/D/2020 of Government of Andhra Pradesh,

Genl.(A) Department, the Government had accorded permission to

proceed for the offences under Prevention of Corruption

(Amendment) Act- 2018 against the petitioner/accused. Since a

case has already been registered in Cr.No.22/2019 in CID Police

Station, A.P., Mangalagiri about the misappropriation of the

petitioner/accused, ADGP, CID, AP, Mangalagiri had issued

instructions to the Investigation officer to add the provisions of the

Prevention of Corruption Act and to continue investigation.

Accordingly, Section 13(1) of Prevention of Corruption Act was

added in this case in additional to the previous sections of law,

hence, now the FIR in Cr.No.22/2019 is under section 403, 409

read with 120-B IPC and Section 13(1) (a) of Prevention of

Corruption (Amendment) Act, 2018 of C.I.D. Police Station, A.P.,

Mangalagiri.

27. Further it is contended in the counter that during the

course of investigation, the original proceedings for the payment

made to the New Indian Express Group through Evntxpress

Management Services Pvt., Ltd. And Sunday Standards along with

the notice file were collected from APEDB and after scrutiny of

those documentary evidence and also as per the evidence of the

oral witnesses, it is clearly established that the petitioner/accused-

1 along with Sri B.Srinivasa Rao (A2) abused his official position

for undue advantage/favour from the then Govt./Hon'ble Chief

Minister and thereby got printed 50,000 books each book

containing 52 pages in Telugu with the photo of Sri Nara Chandra

Babu Naidu with political names as "Eduruleni Nayakudu,

Thiruguleni Party" Telugu Desam Party symbol and etc., inside the

cover of the book written as "special thanks to J. Krishna Kishore

I.R.S., CEO., APEDB published by Indian Express, AVP, Marketing,

Eventxpress, the NEW Indian Express Group, New Delhi printed by

Rigel Business Insight, through a local printing press namely Rigel

Business Insights, Patamata. The payments to the said printer was

paid by the Eventxpress Management Services Pvt., Ltd. and to

causing wrongful loss to the Government exchequer with an

intention for wrongful gain for benefiting to their associates with a

fraudulent intention and committed misappropriation in a manner

of quid-pro-quo.

28. Further it is submitted that the letter from Smt.Leena

Jhalani on behalf of APV Marketing dated 20.02.2019 addressed to

the petitioner/accused-1 stating "the books will be printed under

your supervision in Hyderabad. Editorial, other information and

pictures of the books will be provided by you." It clearly

establishes about the personal interest, involvement of the

petitioner to get those books. Furthermore, several number of

advertisements were given by the petitioner as CEO, APEDB and

nearly Rs.3 Crores were spent for advertisements. A payment of

Rs.1.78 core were paid to the New Indian Express Group, New

Delhi through Eventxpress management Services Pvt. Ltd., for the

"power jacket" advertisement in Sunday Standards, New Delhi 90%

of the invoice was paid as an advance amount. It is further

submitted that except to the above mentioned advertisement

agency, no advance payment was made to any other Advertisement

agency in previous incident. It clearly shows about the vested

interest of the petitioner, obviously with malafide intention and in

execution of criminal conspiracy the petitioner/accused misused

his official capacity and channelled the Government money (public

money) in a legal projecting as official work which involved

conspiracy as a consequent the Government funds were diverted

for unofficial/personal work. Hence, the petitioner/accused had

committed the offence under Section 409 IPC and 13(1) (a)

Prevention of Corruption (Amendment) Act, 2018.

29. Further it is submitted in their counter that the

petitioner being IRS officer may cause hurdle to the investigating

agency to get replies early in transparent way and the punishment

for the offence under Section 409 IPC is more than 7 years, as

such the guidelines issued by the Hon'ble Apex Court in Arnesh

Kumar's case for following the procedure under section 41-A

Cr.P.C. may not be applicable in this case, hence, the

custody/arrest of the petitioner is essential to prevent him from

committing further offence, tampering of evidence, scaring of

witness and falsification of records/documents, thereby prayed to

vacate the direction/order in I.A.No.2 of 2020 in Crl.P.No.7847 of

2019 and to dismiss the present petition.

30. Learned Senior counsel, Sri Naga Mutthu, appearing

on behalf of the petitioners has mainly focused on his arguments

that as per the Andhra Pradesh Economic Development Board Act,

2018, the petitioner is only a Chief Executive Officer of the board

and member convener. Às per Section 3 of the said Act, under

clause (1) , the Government may, by notification constitute a Board

to be called as A.P. Economic Development Board; according to

Section 5 of the Act, the board consists of Chief Minister of the

State as Chairman, Minister of Finance and Planning as Vice

Chairman and Minister for Industries, Minister for Municipal

Administration, Minister for Health, Medical Development, Minister

for Roads and buildings, Minister for Panchayat Raj and Rural

Development, Minister for Water Resources Management, Minister

for Information Technology, and Communication Department,

Chief Secretary to Government, Special Chief Secretary/Principal

Secretary and Secretary for Planning Department, Special Chief

Secretary/Principal Secretary or Secretary to Government, Finance

Department, Special Chief Secretary/Principal Secretary/Secretary

to Government, Industries Department, Special Chief

Secretary/Principal Secretary/Secretary to Government, Municipal

Administration Urban Development Department, Special Chief

Secretary/Principal Secretary/Secretary to Government, Roads and

Buildings Department, Special Chief Secretary/Principal

Secretary/Secretary to Government, Panchyat urban and Rural

Development, Special Chief Secretary/Principal

Secretary/Secretary to Government, Water Resources Management

Department, and Principal Secretary to Government, Information

Technology, Electronics and Communication, Secretary to

Government, Law Department, Chief Executive Officer of the

Board, as Member Convener.

31. According to Section 11 of the Act, the cost towards

functioning of the Board, Advisory Council and Committees,

appointed by the Board, shall be approved by the Board and shall

be borne from the internal funds and from the funds allocated to

the Board by the Government of Andhra Pradesh.

32. As per Section 13 of the Act, all the orders and decisions of

the board shall be authenticated by the signature of the Chief

Executive Officer and all the other deeds, documents and

instruments, executed or issued shall be authenticated by the

signature of the such officer of the Board.

33. Section 19 deals with the functions of the Chief Executive

Officer subject to the orders of the Board and finally, according to

Section 23, the Board shall maintain proper accounts and other

relevant records and prepare annual statement of accounts in

such form as may be prescribed in the regulations.

34. As per the above said provisions of the Act, no independent

powers are given to the Chief Executive Officer [CEO], consequent

to the said Act, the Government of A.P. through G.O.Ms.No.87,

dated 17.03.2016 has constituted/established the Andhra

Pradesh Economic Development Board.

35. Even according to the said G.O., the Government body is

empowered to take various decisions, concerned policy issues and

strategic decisions relating to the functioning of the Board and the

CEO may constitute various departments comprising of officials

including members from time to time to carry out various functions

of the board.

36. Learned senior counsel has specifically emphasised his

contention that according to the provisions of the Act and the

constitution of the Board, it is very clear that the CEO is only a co-

ordinator and he has no independent powers, more so he has no

independent financial power, unless and until it is approved by the

Board.

37. As per Section 19 of the Act, it relates to the functioning of

the Chief Executive Officer, for better appreciation, Section 19 of

the Act, is extracted as follows:

19. Functions of the Chief Executive Officer, -

The Chief Executive Officer, subject to the orders of the Board, shall

be responsible for:

(a) Supervision and direction of staff of the Board;

(b) Undertaking research to determine the industry competitiveness of State and propose strategies to enhance the State as an investment destination;

(c) proposing for the Board's approval, operating and marketing plans for investment promotion and facilitation;

(d) performing the duties of the Secretary to the Board, including preparation of minutes of decisions of the Board;

(e) performing such other functions and duties as may be determined by the Board;

(f) performing all other incidental and ancillary functions as directed by the Government and/or the Board or the Chairman of the Board.

38. As per Section 19(d) and (f) it clarifies the performing of the

duties of the Secretary to the Board and all instantly and

accelerate functions should be as directed by the

Government/Board or the chairman of the board. Hence, the

allegations made in either in the complaint or in the FIR are

baseless. According to the said provisions, the petitioner has

performed his occupation, only as per the advice of the Board,

hence, the petitioner has not taken any decision independently.

39. Further the learned senior counsel emphasised his

arguments that none of the allegations of the FIR would attract the

ingredients of the Sections mentioned in the FIR. The instant

Crime is registered under Sections 188, 403, 409, 120 IPC and the

A. P. Economic Development Board Act, 2018. The allegations

made in the FIR is that they recruited close confidents at a very

high salary, without following due process, thereby committed

criminal breach of trust. Further irregularly released

advertisements directly, instead of going through I & PR

Department, thereby violating the G.O.No.22 of 2019 and caused

loss to the government exchequer.

40. On perusal of FIR, the allegations made against the accused,

would not attract the offences Sections 409, 403 IPC or section188 of

IPC. Hence, the very allegations of the FIR would not attract the

ingredients mentioned in the above said offences.

41. Section 409 of IPC deals with the punishment for criminal breach

of trust by public servant or Criminal breach of trust by public servant,

or by banker, merchant or agent:-

--Whoever, being in any manner entrusted with property, or with any dominion over property in his capacity of a public servant or in the way of his business as a banker, merchant, factor, broker, attorney or agent, commits criminal breach of trust in respect of that property, shall be punished with 1[imprisonment for life], or with imprisonment of either descrip- tion for a term which may extend to ten years, and shall also be liable to fine.

42. In the instant case, the petitioner is no way concerned and he is

not the independent person to deal with the property of the board.

Section 188 IPC deals with the disobedience, to order duly

promulgated by the public servant. No such allegations are made out

against the petitioner in the FIR.

43. Section 403 IPC deals with punishment for dishonest

misappropriation of property, if any person dishonestly mis-

appropriates or converts to his own use any movable property, shall

be punished with imprisonment of either description for a term which

may extend to two years. It is not the case of the petitioner that

either in the complaint or in the FIR there are no such allegations

that the petitioner has misappropriated amounts for his own.

44. On perusal of the complaint as well as the FIR which was

registered against the petitioner, none of the ingredients would attract

for registration of such crime against the petitioner. To support his

contention learned counsel relied on the judgment reported in Indian

oil corporation v. NEPC India Ltd & Ors5, the basic ingredients to

attract the offence under 403 IPC.

45. Further relied on the judgment in Robert John D'souza & Ors.

V. Stephen V.Gomes & Anr6, where the term entrustment has been

explained by the Hon'ble Supreme Court and submitted that entire

FIR allegations does not disclose as to what property was entrusted

with the petitioner by the complainant and for benefit of whom.

46. Further learned senior counsel has submitted that the

present FIR has registered against the petitioner without following

the guidelines prescribed by the Hon'ble Apex Court in

Lalithakumari's case cited supra.

47. According to the said guidelines, when the allegations are

made, it is the primary duty of the investigation officers to conduct

preliminary investigation before registering the crime. But in the

instant case, without following the said principle, based on the

complaint dated 15.12.2019 by Smt.Potluri Tulasi Rani, Special

Grade Deputy Collector, APEDB, Vijayawada, on the same day

itself, it was registered by the CID, which is contrary to the

(2006) 6 SCC 736 2 (2015) 9 SCC 96

observations laid down by the Hon'ble Apex Court in the above said

judgment.

48. Lastly, learned senior counsel emphasized that the

registration of the crime against the petitioner itself is dishonest

malafide intention.

49. To support his contention learned senior counsel has drawn

to the court's attention about the preliminary complaint made by

the one Vadapally Srinatha Rao, to the Ajay Kallam, I.A.S.,

Principal Advisor to Hon'ble Chief Minister, Government of Andhra

Pradesh, vide letter dated 21.07.2019. the contents of the said

letter clearly discloses that the petitioner, while working as

Commissioner of Income Tax, is a close friend of Mr.Lakshmi

Narayana, formerly J. D., CBI, who investigated the false cases

foisted against the present Chief Minister. Thus, when there is

specific averment made in the letter, just because of that he is

close friend of Ex-Joint Director of CBI, the petitioner was dragged

into the present complaint with false and baseless allegations.

That too, basing upon the letter addressed to the Principal advisor

to the Chief Minister, immediately acting on the same, and have

registered a false case against the petitioner.

50. Even according to the complaint made by the Smt. Potluri

Tulasi Rani, dated 15.12.2019, clearly stated that on an

administrative enquiry report, certain irregularities found against

J.Krishna Kishore, IRS the then CEO, APEDB. In the said report,

they have clearly mentioned that on enquiry, they found

irregularities. At the most, based on the said irregularities, if at all

they can proceed against the petitioner on a departmental enquiry,

no such irregularities would attract to register a crime against the

petitioner.

51. Learned senior counsel has further submitted that the very

registration of a crime basing on a letter, addressed by a party

worker of a particular political party, saying that because the

petitioner is a friend of Sri Lakshmi Narayana, former J.D., CBI,

who investigated the cases against the present Chief Minister,

clearly discloses that it is made with a malafide intention. So also

nowhere in the counter, or in the enquiry conducted by the

department on administrative side and in the investigation does

not answer with regard to the contentions made in the original

letter/complaint.

52. Replying to the same, learned Standing Counsel appearing

on behalf of the respondents has brought to the notice of the

Court, that before filing/registration of the crime against the

petitioner, the department has conducted an enquiry and

submitted a report along with the preliminary enquiry, based on

which, the complainant has made complaint on 15.12.2019 along

with the report. Based on the said report, the respondent-CID

registered a crime against the petitioner and others, under Sections

188, 403, 409, 120 B IPC. He also mainly relied on the allegations

made in the report. Though it is mentioned as irregularities by the

complainant, but the allegations in the report are very serious,

which attracts the ingredients of the Section 409 IPC as well as

403 of IPC. He further contended that the criminal law can be set

into motion by any person, here though the complaint is made by a

whistle blower, based on the enquiry conducted and report

submitted by the department, the complainant has filed the

present complaint.

53. Learned counsel further submitted that the preliminary

enquiry cannot be made mandatory in all the cases of alleged

corruption and to support his contention relied on the observations

made by the Apex Court in Lalitha Kumari's case.

54. According to him, preliminary enquiry is not mandatory

when the information received discloses the commission of a

cognizable offence; even when it is conducted, the scope of

preliminary enquiry is not to ascertain the veracity of information,

but only whether to find out the commission of a cognizable offence

or not.

55. Further he contended that conducting preliminary enquiry,

depends upon the facts and circumstances of each case. In the

instant case, based on the complaint of a third party, department

has conducted thorough enquiry and based on the report

submitted by department, present FIR is registered.

56. No doubt though the senior counsel mainly emphasised his

argument on the Act and the power of the petitioners under the

Act, the same was not denied by the respondent, and no material

was placed before this Court that the petitioner has acted contrary

to the advice of the board or without permission of the board.

57. Considering the submissions made by both the counsel,

though there are specific grounds raised by the senior counsel that

the allegations made in the FIR would not attract the ingredients of

Sections 403, 409 and 188 of IPC, on perusal of the complaint as

well as the allegations made therein, it clearly discloses that said

allegations would not attract the ingredients of the above said

sections.

58. On perusal of the contents of the FIR and considering the

principles laid down by the Hon'ble Apex court, in State of

Haryana v. Bhajan Lal7, while examining under what

circumstances and in which category of cases relating to criminal

proceedings can be quashed either in exercise of extraordinary

powers vested in the High Court under Articles 226 of the

Constitution of India or in exercise of inherent powers of the High

Court under Section 482 of the Code of Criminal Procedure and

after referring to plethora of case laws have illustratively indicated

the categories of cases where such power could be exercised by the

High Court. It was held:

"102. In the backdrop of the interpretation of the various relevant provisions of the Code under Chapter XIV and of the principles of law enunciated by this Court in a series of decisions relating to the exercise of the extraordinary power under Article 226 or the inherent powers under Section 482 of the Code which we have extracted and reproduced above, we give the following categories of cases by way of illustration wherein such power could be exercised either to prevent abuse of the process of any court or otherwise to secure the ends of justice, though it may not be possible to lay down any precise, clearly defined and sufficiently channelised and inflexible guidelines or rigid formulae and to give an exhaustive list of myriad kinds of cases wherein such power should be exercised.

(1) Where the allegations made in the first information report or the complaint, even if they are taken at their face value and accepted in their entirety do not prima facie constitute any offence or make out a case against the accused.

(2) Where the allegations in the first information report and other materials, if any, accompanying the FIR do not disclose a cognizable offence, justifying an investigation by police officers under Section 156(1) of the Code except under an order of a Magistrate within the purview of Section 155(2) of the Code. (3) Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same do not disclose the commission of any offence and make out a case against the accused.

1992 Supp (1) SCC 335

(4) Where, the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated under Section 155(2) of the Code.

(5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused.

(6) Where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the concerned Act, providing efficacious redress for the grievance of the aggrieved party. (7) Where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge."

59. In the light of the above judgment, in the instant case, on

perusal of the ingredients of the complaint and the allegations

made therein, clearly comes under the purview of principle No.1,

since the face value of the allegations made in the first information

report or the complaint are baseless.

60. According to principle No.3, it is clear that where the

allegations made in the FIR or complaint, and the evidence

collected in support of the same, do not discloses the commission

of offence, and make out the case against the accused, it is liable to

be quashed. In the instant case, though they have made allegations

against the petitioner, there are no material to show that the

petitioner himself has done the acts. And finally as per Principle

No7, where the criminal proceedings is manifestly attended with a

malafide and/or where the proceedings maliciously instituted with

an ulterior motive for wreaking vengeance on the accused and with

a view to spite him due to private and personal grudge, where this

court can exercise the power under Section 482 Cr.P.C..

61. In the instant case, the very basis of initiation of proceedings,

basing on a letter of the whistle blower, alleging that the petitioner

is friend of Sri Lakshmi Narayana, former J.D., CBI, who has

investigated the cases against the present Chief Minister, which

clearly discloses that the present crime is registered for extraneous

reasons. No doubt, initially the petitioner was suspended but

the same was interdicted by the Central Administrative Tribunal,

Hyderabad, and the present crime is registered against the

petitioner with an afterthought only.

62. Taking the above facts and circumstances of the case into

consideration as well as the observations made by the Hon'ble

Apex Court in the above referred judgments, FIR in Cr.No.22 of

2019 dated 15.12.2019 registered against the petitioner, on the

file of CID Head Quarters Police Station, Mangalagiri is hereby

quashed.

63 Accordingly, the Criminal Petition is allowed. There shall be

no order as to costs.

As a sequel, miscellaneous applications pending, if any, shall

also stand closed.

______________________ JUSTICE D. RAMESH

Date: 13.07.2022 Pnr