Dilawar Mir vs Cbi
2009 Latest Caselaw 785 Del

*          IN THE HIGH COURT OF DELHI AT NEW DELHI


%                                         Date of reserve : 25.02.2009
     `                                    Date of decision : 12.03.2009

+        Crl.REV P. No. 279/2007


DILAWAR MIR                                           ...PETITIONER
                               Through: Mr. Sanjiv.K.Jha, advocate

                                       Versus

CBI                                                  ...RESPONDENT
                              Through: Vikas Pahwa, standing counsel CBI



+        Crl.REV.P. No. 356/2007



D.S. KANWAR                                          ...PETITIONER
                               Through: Mr. D.R.Bhatia, advocate

                                       Versus

CBI                                                  ...RESPONDENT
                              Through: Vikas Pahwa, standing counsel CBI


CORAM:
HON'BLE MR. JUSTICE MOOL CHAND GARG

1.       Whether the Reporters of local papers                  Yes
         may be allowed to see the judgment?

2.       To be referred to Reporter or not?                     Yes

3.       Whether the judgment should be                         Yes
         reported in the Digest?

MOOL CHAND GARG, J.

1. This order shall dispose of both the aforesaid revision

petitions which assails the order dated 06.03.2007 passed by a

Learned Special Judge CBI in criminal case No. 10/2000 arising

out of R.C. No. AC-1/98-A0003/CBI/ACU-I/ND whereby charges

have been framed against both the petitioners under Section

120-B/420 IPC read with Section 13(2) read with 13(1) (d) of the

RC Act, 1988. The FIR, in the instant case, was registered on

30.6.1998 and the charge sheet against the accused persons was

filed on 1.3.2000.

2. In short the allegations of the prosecution are that a

contract was awarded by Shri D.S. Kanwar (Accused No. 1/ A1)

while working as the General Manager with M/s. National

Fertilizers Limited (NFL) in favour of Shri Dilawar Mir (Accused No.

2/ A2) for handling-cum-general services to National Fertilizers

Limited (NFL) & transporting supplies to cooperatives and other

institutional agencies in the State of Punjab and Haryana vide

Agreement dated 9.9.1993 for a period of five years. The

contract was signed by Accused No. 1 in his capacity as General

Manager(Marketing ) on behalf of NFL. As per the terms and

conditions the Accused No. 2 was to be paid remuneration of

Rs.65/- per metric tons of Urea manufactured by NFL and

supplied to the institutional buyers. If the quantity of the

fertilizers supplied exceeded 2 lacs tons, the enhanced

remuneration was payable @ 100 per metric ton. In case the

take-off was less than 1.5 lakh tons, the remuneration was to be

reduced to Rs.50/ per metric ton. It is also the case of the

prosecution that Accused No. 1 to give undue favour to Accused

No. 2, executed the contract in his favour without following the

guidelines, in particular the guidelines given in letter dated

22.06.1990, wherein it was specifically mentioned that the

General Manager ( Marketing) though has full powers to enter

into contract regarding handling of material, subject to conditions

namely: (i) financial concurrence; (ii) allocation in the budget and

(iii) prior approval of the Director (Finance) or Managing Director

with regard to the rates and terms and conditions of contract

involving the expenditure of Rs.50,000/- or above in each case.

However, Accused No. 1 neither followed the guidelines nor

invited tenders for the execution of this contract.

3. The Accused no. 1, in furtherance of conspiracy with

Accused No. 2, also facilitated the release of ad-hoc payment of

Rs.30 lacs in favour of Accused No. 2 and for that he directed

staff of NFL to stay in office beyond the office hours and

personally went to the office and collected the draft to be handed

to Accused No. 2. The Accused No. 2 was a former Minister of

Jammu & Kashmir State. The Accused No. 1 asked Sh. M. A.

Sharma to release the ad-hoc payment without the same being

verified by the field staff. This aspect of release of payment

without verification stands established by the statement of

prosecution witnesses M. A. Sharma and Anil Kumar Sharma.

During the course of investigation, the CBI also recorded the

statement of various witnesses who stated that no work was

performed by M/s Good Friends Agencies and was actually done

by the field staff of NFL. The bills which were raised by the

Accused No. 2 were false as no work was performed by them in

terms of contract dated 9.9.1993. The perusal of letter dated

31.3.1995 also shows that Accused No. 1 facilitated the release of

an ad-hoc payment of Rs.30 lacs against the bill of Rs.40 lacs.

4. The learned Special Judge, after hearing the parties, framed

charges against both the petitioners under Section 13(2) & 13(1)

(d) of the Prevention of Corruption Act, read with section.120-

B/420, IPC and directed the petitioners to face trial in the

aforesaid case.

5. Both the petitioners have assailed the said order and during

the course of arguments have made identical submissions.

Petitioner Dilawar Mir submitted that the criminal proceedings

have been initiated against him on 20.2.1998 as a counter blast

because the petitioner had challenged the illegal termination of

the contract by way of Civil writ Petition No. 2322/1997. He has

submitted that the agreement dated 9.9.1993 was entered into

between National Fertilizers Limited and proprietorship concern

of the petitioner namely M/s. Good Friends Agencies (GFA) on the

recommendation of the then Union Ministers of state

categorically. Thus it is submitted that there was no conspiracy

between the petitioners and it falsifies the allegations made in

the charge sheet of entering into a conspiracy by him with D. S.

Kanwar. It has been submitted that the allegations of the

prosecution that the established procedure as set up by the

various guidelines and rules of NFL was not followed stands

falsified in the light of the fact that the contract dated 9.9.1993

was a rate contract and that the charge sheet nowhere discloses

that the person finally signing the agreement was not

empowered to enter into a rate contract. However the trial court

in the impugned order dated 6.3.2007 in deciding that the person

did not have power to enter into the contract states the rates at

which the contract was to be given but fails to state that the

Accused D. S. Kanwar was not entitled to enter into a rate

contract.

6. It is also submitted that the liability to pay various amounts

to Accused No. 2 was recognized and accepted by the

Apportionment Committee which documents has been

completely ignored by the trial Court. While framing of the

charge. It is also submitted that there is nothing on record to

show that the petitioner had any dishonest intention. It is also

submitted that the Special Judge himself stated that even if it is

assumed that there was no intention to cheat at the time of

entering into the contract, there was definitely an intention to do

so at the time of presenting the bills which it is submitted, is not

correct view taken by learned Special Judge, in view of the

following judgments:

AIR 2001 SC 1226

AIR 2003 SC 1069

AIR 1974 SC 301

(2006) 6 SCC 736 and

(2007) 10 SCC 110.

7. It has also stated that even otherwise no case was made

out under Section 420 IPC read with Section 120-B IPC and there

is every likelihood that the petitioner will stand acquitted without

cross-examination of the witnesses.

8. In so far as Accused No. 1 is concerned while reiterating the

submissions made by Accused No. 2 he also stated that the

agreement in question was prepared by one Anil Kumar Sharma,

the Deputy Manger and not by the petitioner D. S. Kanwar. The

agreement went up to the higher authorities before it was finally

executed. It is also stated that the Additional Manager (F & A)

had given approval for payments and thus it cannot be said that

the senior officials were not brought into the picture and were not

aware of their entering into agreement in question. It is also

submitted the Apportionment Committee nowhere states that

there was any offence committed by the petitioner or that any

fraud was played by him or that any act of cheating was done

while entering into the agreement or while approving the

payments to Mir Dilawar. It is, thus, submitted that in the facts of

the case, the charges framed against the petitioner D. S. Kanwar

are required to be quashed.

9. I have heard the arguments on behalf of both the sides and

have perused the written submissions.

10. From the written submissions placed on record by the

Central Bureau of Investigation, it has come on record, that

agreement in question though could have been executed by the

General Manager, requires (i) financial concurrence; (ii) allocation

in the budget and (iii) was subject to prior approval of the

Director (Finance) or Managing Director which is not available in

this case. For the rates and terms and conditions of contract, no

tender was floated for the purpose of awarding such a contract

which included huge financial liabilities. It is also submitted by

the CBI that during the course of investigation they recorded

statement of various witnesses. It is also the case of the

prosecution that in fact no supplies were made by Accused No. 2

i.e. Dilawar Mir and he raised bogus bills.

11. Thus, on the one hand, the agreement in question was not

executed by the petitioner D. S. Kanwar, in favour of second

petitioner after following the norms, he also facilitated payment

of huge amounts to Shri Dilawar Mir i.e. Accused No. 2 even

though he had not performed the work assigned to him. Thus,

prima facie, it cannot be said that no case is made out against

the petitioners.

12. The defence raised by the petitioner can always be

examined by the Trial Court while recording the evidence. The

facts which have been revealed by the prosecution in the

challenge filed by them after investigation reveals that both the

petitioners were found guilty of having committed offence under

Section 420/120-B IPC read with Section 13(2) and 13(1)(d) of

Prevention of Corruption Act.

13. It is well established that at the stage of framing of charges

under Section 227 and 228 of CrPC, the truth, veracity and the

necessary effect of the evidence, which the prosecution proposes

to prove, is not required to be meticulously judged by the learned

trial court. This exercise cannot be done with the standard of

test, proof and judgment which is to be filed finally before finding

the accused to be guilty or otherwise. The charges against the

accused persons can be framed even on the basis of strong

suspicion found on the material collected by the investigating

agency during the course of investigation. The trial court can

form a presumptive opinion regarding the existence of factual

ingredients constituting the offence alleged and thus in that

event, be justified in framing the charges against the accused in

respect of the offences alleged to have been committed by them.

14. In this regard reference has also been made to the following

judgments by the respondents, i.e.:

i. Kanti Bhadra Shah Vs. State of West Bengal 2000(1) SCC 722;

ii. State of Bihar Vs. RameshMir 1977(4) SCC 39;

        iii.    Omwati Vs. State 2001 (4) SCC 333;

        iv.     Umar Abdulla Skoor Sorathai Vs. Intelligence Officer,
                narcotic Control Bureau JT 1999 (5) SC 39;

         v.     Sapna Ahuja Vs. State 1999 (5) AD, Delhi 407;

        vi.     Radhey Shyam Vs. Kunj Bihari, 1989 Supp. (2) SCC
                572;

       vii.     State of M.P. Vs. S.B. Johari , 2000 SCC (Crl) 311 and;

      viii.     Soma Chakravarty Vs. State, 126 (2006) DLT 289.

15. I have gone through the aforesaid judgments as well as the

judgment cited on behalf of the petitioners and I have also

examined the order passed by the Additional Sessions Judge

framing the charges against both the petitioners.

16. A perusal of the order goes to show that the learned Special

Judge has taken into consideration the material which was

available on record, specifically the contract which was entered

into between both the petitioners on behalf of National Fertilizers

Limited without complying with the necessary formalities; the

fact that no work was done in pursuance of the contract which

was required to be done by M/s. Good Friends Agencies (a

proprietary concern) of Dilawar Mir. Some of the observations

made by the Special Judge can be incorporated for reference

which shows that charge in question has been framed by the

learned Special Judge after applying his judicial mind to the facts

of this case.

" I am unable to appreciate the contention raised on behalf of the accused persons that the original contract has not been placed on record which would have shown that it had been forwarded or recommended by the Hon'ble Minister or by the Managing Director. Documents D2 is the original contract, which is signed by A.1 on behalf of NFL and accepted by A2 being proprietor of Good Friends Agencies. As per the office order dated 22.6.90(d7) the General Manager ( Marketing) had full powers to enter into contract regarding handling of material subject to two conditions namely financial concurrence and allocation in the budget and subject to prior approval of Director (fin) or Mg. Director with regard to the rates and terms and conditions of contract involving expenditure of Rs.50,000/- or above in each case. The contract in question was for a period of five years w.e.f. October 1, 1993. It is mentioned in the contract that there was a gestation period of six months and the management could terminate the contract if A2 was not in a position to discharge his service obligation to the entire satisfaction of NFL. In my view, it is clear from the term of the contract that it was for a period of five years. Assuming for the sake of argument that it could be terminated after a period of six months and therefore it was for a period of six months, even then the term would show that A2 was to be paid the handling charges @ Rs.65/-PMT in respect of the Urea supplied to the institutional agencies and cooperative societies. It is part of the terms and conditions itself that A2 was entitled to enhanced remuneration @ 100 PMT if the quantity was to exceed 2lacs MT for a single crop season of six months. It was therefore apparent that even during the period of six months A2 could get a commission of more than Rs.2 Crores if the supplies were above 2 lacs MTs. A perusal of the letters dated 18.12.93 (d42), 4.1.94 (D.44), 15.2.94 (D45), 15.2.94 (D46), 10.2.94 (D47) would show that during the span of couple of months the bills @ Rs.65 PMT totaling about Rs.40 lacs were raised by A2 on NFL, it is therefore apparent that the contract involved expenditure of more than Rs.50,000/- and therefore prior approval of Director (Fin.)/ Managing Director was required for entering the contract. There is not even a whisper in the agreement dated 9.9.93 signed by A2 and A1 that there was approval of Director (F)/MD. Thus at this stage, I am inclined to believe that the contract was entered into by

A1 without requisite authority for the same.

I have just mentioned herein above that certain bills were submitted by A2. It has come in the statement of Shri M. A. Sharma that on 31.5.1994, A1 had asked him to stay in the office after office hours. He has further stated in his statement u/s. 161 that Anil Kumar Sharma (witness no. 34) had also come to his office and had received similar orders from A1.

When they reported to A1, they were informed that the company (NFL) had entered into a contract with M/s. Good Friends Agencies and had appointed them as handling and general service contract for the sale of Urea fertilizers to institutional agencies. He also handed over a copy of the contract and told them to release and ad-hoc payment of Rs.30 lacs which was released in favour of A2 proprietor of M/s Good Friends agencies on the instructions of D. S. Kanwar (A1) on 1.6.94. The witness has further stated that A1 had personally collected the cheque and left the office for handing over the same to A2. He states that it was later learnt that Dilawar Mir was the Ex Minister of J & K State. The witness has stated that he had asked A1 while releasing an ad-hoc payment that the bills submitted by M/s Good Friends Agencies have not been verified by the field staff of A1 and did not care for the work and asked him to make payment. To the same effect is the statement U/s. 161 CrPC made by witness no. 34 Anil Kumar Sharma. A perusal of the various bills i.e. D.43 to D.47 on record would show that the same have been claimed @ Rs.65 PMT though as per the revised offer made by A2 vide letter dt. 31.3.95 (D52), A2 had mentioned that he may be paid @ Rs. 15PMT (instead of Rs.65 PMT) and that except for the work of liaison procurement of order and realization of payment could not be done by Good Friends Agencies. The said officer made by A2 was readily accepted by A.1. During the course of investigation the CBI has recorded the statement of number of witnesses to the effect that the work was not performed by Good Friends Agencies and that the work was in fact done by the field staff of NFL. The dishonest intention could be inferred on the part of A2 in raising the bill @ Rs. 65 PMT, when A2 was well aware that the work in terms of contract dt. 9.9.93 had not been done. If the subsequent letter dated 31.3.95 (D52) is

accepted on the face value, asking for release of adhoc payment of Rs.30 lacs against the bill for Rs.40 lacs by A1 to his subordinate officers would lead to an inference of conspiracy between A1 and A2 for doing an illegal act. It can also be inferred from the material collected during investigation that A2 had misused his official position to cause wrongful gain to A2.

There is nothing on record to show that the contract was forwarded by the minister of State for Chemicals & Fertilizers or that the contract was recommended by the Managing Director of the NFL. Assuming that the Minister had forwarded any application made by A2 that would not mean that the established procedure has to be given a go bye or that the contract has to be awarded to A2.

An apportionment committee was constituted to apportion the amount under different heads to find out as to what would be the amount payable to A2. Thus as against the payment of Rs.100 PMT, A2 was not entitled to Rs.91.90 paise plus A2 was also to pay the demurrage/wharfare if any. Moreover, as per condition 3(h) of the contract dated 9.9.93 it was the duty of the contractor to recover the payment including the interest on delayed payment at bank rate plus 1%. This amount of interest was also recoverable from the remuneration paid to M/s. Good Friends Agencies. The hurried payment without considering the recovery under these heads at the instance of A1 and collection of the cheque by A1 for handing over the same to A2 would also lead to an inference of conspiracy between A1 and A2. The statement of witness no. 2 that the contents of the contract were typed by him on dictation of A1 in September 1993 would also point out that there was no approval from the ED(F) or MD of NFL. Statement of witness No. 3 would show that there was no need of the contract like the one dated 9.9.94 as NFL had sufficient field staff to take care of the work (and in fact the major work had not been done by A2 as was stated by him in his letter for revising the terms of the contract vide D.52)."

17. The aforesaid discussion clearly holds that in this case

Accused No. 1 not only mis-used his official post in executing the

agreement in favour of Accused No. 2 without following the

guidelines so as to benefit him out of the bill; Accused No. 2 also

tried to cheat NFL without doing the work. Thus, all the

ingredients of charges framed against the petitioner were

available on record. In these circumstances, the charges framed

against both the petitioners are justified and as such both the

petitions are dismissed. The parties may appear before the

learned Special Judge on the date as fixed for further

proceedings.

MOOL CHAND GARG, J.

March 12, 2009 ag