[Cites 13, Cited by 0]
Karnataka High Court
Sri Mahantesh Bilagi vs The State Of Karnataka on 2 December, 2025
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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 2ND DAY OF DECEMBER, 2025
BEFORE
THE HON'BLE MR. JUSTICE M.I.ARUN
CRIMINAL PETITION NO.11571 OF 2025
(482(Cr.PC)/528(BNSS))
CONNECTED WITH
CRIMINAL PETITION NO.11573 OF 2025
(482(Cr.PC)/528(BNSS))
IN CRL.P.NO.11571/2025:
BETWEEN:
1 . SRI MAHANTESH BILAGI
S/O GURUBASSAPPA,
AGED ABOUT 51 YEARS,
FORMER MANAGING DIRECTOR,
B.E.S.C.O.M
PRESENTLY MANAGING DIRECTOR OF
KARNATAKA STATE MINERALS
CORPORATION LIMITED,
HAVING OFFICE AT 5TH FLOOR,
'A' BLOCK,
TTMC BUILDING,
B.M.T.C, SHANTINAGAR,
BENGALURU- 560 027.
2 . SRI. RAMESH H.J.,
S/O HANUMANTAPPA V
AGED 58 YEARS
DIRECTOR TECHNICAL B.E.S.C.O.M
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HAVING OFFICE AT B.E.S.C.O.M
CORPORATION OFFICE,
K.R. CIRCLE,
BENGALURU-560 001.
...PETITIONERS
(BY SRI VIKRAM S. HUILGOL, SENIOR ADVOCATE FOR
SMT. LEELA P. DEVADIGA, AND SRI KARTHIK N.,
ADVOCATES )
AND:
1 . THE STATE OF KARNATAKA
BY LOKAYUKTHA POLICE,
REP BY SPECIAL PUBLIC PROSECUTOR,
HIGH COURT BUILDING,
BANGALORE-560 001.
2. DR. ASHWATHNARAYAN C.N.
S/O T.K. NARAYANAPPA
AGED ABOUT 57 YEARS
MEMBER OF LEGISLATIVE ASSEMBLY
MALLESHWARAM CONSTITUENCY
RESIDING AT NO.87,
6TH CROSS
2ND MAIN, 1ST BLOCK
RMV 2ND STAGE
ASHWATH NAGAR
BANGALORE-560 094.
3. S.R. VISHWANATH
S/O LATE RAMAIAH
AGED ABOUT 63 YEARS
MEMBER OF LEGISLATIVE ASSEMBLY
YELAHANKA CONSTITUENCY
RESIDING AT NO.14/1,
SINGANAYAKANAHALLI
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YELAHANKA HOBLI
BANGALORE (NORTH)-560 064.
4 . DHEERAJ MUNIRAJ,
MEMBER OF LEGISLATIVE ASSEMBLY,
DODDABALLAPURA CONSTITUENCY,
RESIDING AT ANJANADRI,
ARKAVATHIBADAVANE,
D CROSS,
DODDABALLAPUR,
BANGALORE-561 203.
... RESPONDENTS
(BY SMT. VENKATESH S. ARBATTI, ADVOCATE FOR R.1;
SMT. LAKSHMY IYENGAR, SENIOR ADVOCATE FOR
SRI C. KARTHIK, ADVOCATE FOR R.2 TO R.4.)
THIS CRIMINAL PETITION IS FILED UNDER SECTION
528 BHARATIYA NAGARIK SURAKSHA SANHITA (BNSS),
2023, PRAYING TO QUASH THE ENTIRE PROCEEDINGS IN
PCR NO.24/2025, PENDING ON THE FILE OF THE HON'BLE
ADDITIONAL CITY CIVIL AND SESSIONS JUDGE AND
SPECIAL JUDGE (CCH-82), BENGALURU, INCLUDING THE
PRIVATE COMPLAINT DATED 21.04.2025 AND THE ORDER
DATED 23.07.2025 PASSED UNDER SECTION 175(4) OF
THE BHARATIYA NAGARIK SURAKSHA SANHITA, 2023, AS
BEING ILLEGAL, ARBITRARY, AND AN ABUSE OF PROCESS
OF LAW, IN THE INTEREST OF JUSTICE AND EQUITY.
IN CRL.P.NO.11573/2025:
BETWEEN:
1. SRI K J GEORGE
MINISTER OF ENERGY
GOVERNMENT OF KARNATAKA
ALSO, CHAIRMAN OF B.E.S.C.O.M
S/O LATE K C JOSEPH
AGED ABOUT 76 YEARS
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HAVING OFFICE AT ROOM NO.317-317A,
3RD FLOOR,
VIDHANA SOUDHA
DR. B.R. AMBEDKAR STREET
BENGALURU-560 001.
...PETITIONER
(BY SRI. K.N. PHANINDRA, SENIOR ADVOCATE FOR
SRI SHATHABISH SHIVANNA,
SRI SAMRUDA SURAJ HEGDE AND
SRI ABHISHEK J., ADVOCATES)
AND:
1 . STATE OF KARNATAKA
BY KARNATAKA LOKAYUKTA
BENGALURU
REPRESENTED BY THE SPP OFFICE,
HIGH COURT OF KARNATAKA,
BANGALORE-560 001.
2 . DR. ASHWATHNARAYAN C.N.
AGED ABOUT 57 YEARS,
S/O. T K NARAYANAPPA
MEMBER OF LEGISLATIVE ASSEMBLY,
MALLESHWARAM CONSTITUENCY,
RESIDING AT NO.87,
6TH CROSS, 2ND MAIN,
1ST BLOCK,
RMV 2ND STAGE,
ASHWATH NAGAR,
BANGALORE-560 094.
3 . S.R. VISHWANATH
AGED ABOUT 63 YEARS,
S/O. LATE RAMAIAH
MEMBER OF LEGISLATIVE ASSEMBLY,
YELAHANKA CONSTITUENCY,
RESIDING AT NO.14/1,
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SINGANAYAKANAHALLI,
YELAHANKA HOBLI,
BANGALORE (NORTH)-560 064.
4 . DHEERAJ MUNIRAJ
AGED ABOUT 33 YEARS,
S/O. P MUNIRAJ
MEMBER OF LEGISLATIVE ASSEMBLY,
DODDABALLAPURA CONSTITUENCY,
RESIDING AT ANJANADRI,
ARKAVATHI BADAVANE,
D CROSS, DODDABALLAPUR,
BANGALORE DISTRICT-561 203.
...RESPONDENTS
(BY SRI. VENKATESH S. ARABATTI, ADVOCATE FOR R.1;
SMT. LAKSHMY IYENGAR, SENIOR ADVOCATE FOR
SRI C. KARTHIK, ADVOCATE FOR R.2 TO R.4.)
THIS CRIMINAL PETITION IS FILED UNDER SECTION
528 BHARATIYA NAGARIK SURAKSHA SANHITA (BNSS),
2023, PRAYING TO QUASH THE PRIVATE COMPLAINT
DATED 17.07.2025 IN P.C.R.NO.24/25 FOR OFFENCES
P/U/S.314, 316 AND 61 OF THE BNS, 2023 AND SECTIONS
13(1)(a) AND 13(1)(b) OF THE PREVENTION OF
CORRUPTION ACT (AMENDED 2018) PENDING ON THE FILE
OF THE HON'BLE ADDITIONAL CITY CIVIL AND SESSIONS
JUDGE, BENGALURU, (SPECIAL COURT EXCLUSIVELY TO
DEAL WITH THE CRIMINAL CASES RELATED TO ELECTED
MPS./MLAS IN THE STATE OF KARNATAKA) (CCH-82), ETC.
THESE CRIMINAL PETITIONS HAVING BEEN HEARD
AND RESERVED FOR ORDERS ON 05.11.2025 AND COMING
ON FOR PRONOUNCEMENT OF ORDERS, THROUGH
PHYSICAL HEARING/VIDEO CONFERENCING THIS DAY, THE
COURT MADE THE FOLLOWING:
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CORAM: HON'BLE MR. JUSTICE M.I.ARUN
CAV ORDER
1. Aggrieved by the order dated 23.07.2025 passed
in PCR No.Nil of 2025 (now numbered as PCR
No.24/2025) by the LXXXI Additional City Civil and
Sessions Judge, Bengaluru (CCH 82), accused No.1 has
preferred Crl.P.No.11573/2025 and accused Nos.3 and
4 have preferred Crl.P.No.11571/2025.
2. For the sake of convenience, the parties are
referred to as per their status before the trial Court.
3. Accused No.1 is the Energy Minister for the State
of Karnataka and Chairman of Bengaluru Electricity
Supply Company Limited (BESCOM). Accused No.3
was the Managing Director of BESCOM and accused
No.4 was a Director of BESCOM. Petitioners are
Members of Legislative Assembly from the opposition
party in the State of Karnataka.
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4. BESCOM invited tender for selection of AMI
Common Service Provider for Sale of Smart Meters to
prospective consumers in BESCOM Jurisdiction on
contract award basis in retail outlets for arranging
power supply to new connections (including temporary
installations) for a period of 5 years and Supply,
Implementation, Commissioning & Maintenance of the
common AMI System for Smart meters for a period of
10 years in all the ESCOMs of Karnataka. The same
has been awarded in favour of one M/s.Rajashree
Electricals Private Limited, Davangere. On the
allegations that a criminal conspiracy was hatched at
the behest of accused No.1 along with the other
accused to favour the successful bidder in order to
unlawfully enrich accused No.1, a private complaint has
been lodged by the complainants by way of PCR
No.Nil/2025, before the Special Court nominated to
deal with criminal cases related to former and elected
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MP's / MLA's in the State of Karnataka. Before filing of
the said private complaint, the complainants have
approached the Lokayuktha Police and also sought
permission from His Excellency, the Governor of the
State of Karnataka to launch prosecution against the
accused.
5. It is alleged that the entire tender process has
been designed so that the contract is awarded in favour
of the successful bidder (M/s.Rajashree Electricals
Private Limited). It is alleged that there has been an
illegality committed in framing eligibility methods of
valuation and terms and conditions in the tender
document. It is also alleged that there is a illegality in
evaluation of bids. Illegality is also alleged in the final
decision taken by the BESCOM in awarding the contract
in favour of the successful bidder and also in
incorporating the agreed terms and conditions in the
contract.
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6. The allegations against the accused made in the
complaint are as follows:-
"8. The complainants submit that, it is to be
noted that the following infractions were
carried out by BESCOM's various committees
and officials in the B.E.S.C.O.M smart meter
tender to prop-up the prima facie shell of the
criminal conspiracy M/s. Rajashree Electrical
Davangere and keep other vendors out of the
bid:-
I. The Tender value was reduced to Rs.997
Crores even though the actual value was more
than Rs.5,296 Crores over a 10-year period.
II. The Estimated Annual Payment was
reduced to Rs. 107.11 Crores even though the
actual value was more than Rs.1,059 Crores.
III. Illegally & subjectively allowing and
disallowing the use of credentials of sub-
contracting to supplement the qualifying
credentials or lack of it of the prime
contractor. To ensure that other Nationally
and internationally capable firms would not
qualify to participate in the tender thereby,
foregoing the need for Global Tenders to
ensure bids were restricted and outcome of
the bid was certain.
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IV. Deleting the Bid Capacity clause of K.W-4
format which would have precluded M/s.
Rajashree Electrical Davangere and M/s VR
Patil VividhVidyuthNirman Pvt. Ltd.
V. Reducing the previous experience of supply
of meters to Rs.53.55 Crores instead of
Rs.2,648 Crores so as to specifically M/s
Rajashree who precisely met with 53.55 Cr
criteria.
VI. Reducing the Earnest Money Deposit &
Performance Security to Rs.10.06 Crores and
Rs.4 Crores instead of Rs.52.96 Crores and
Rs.264.8 Crores to provide pecuniary benefit
to the M/s Rajashree Electrical Davangere.
VII. Not disqualifying the bid of M/s.
Rajashree Electrical Davangere for utilizing
the credentials of a blacklisted company. M/s
B.C.I.T.S Pvt. Ltd, who was collaborated with
for the said project. Further, it is to be noted
that M/s. B.C.I.T.S Pvt. was disqualified for
fraudulently reporting ghost (connections that
do not exist) connections for the Utility in
Uttar Pradesh. M/s B.C.I.T.S was disqualified
for period of two years from 06.01.2023 to
06.01.2025. The copy of order passed by
PoorvanchalVidyuthVitharanaNigham limited
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dated 06.01.2023 is produced as Document
No.9.
VIII. Illegally negotiating and renegotiating
with M/s. Rajashree Electrical Davangere even
though their bid was above 10% of the
estimated value of tender prescribed by
BESCOM in direct contravention of K.T.P.P and
Norms which state that bids above 10% of the
estimated value are to be deemed
substantially high and retendered. Any bid
that is 10 percent of estimated value would
have to be cancelled as per the guidelines
issued by the government of Karnataka
bearing Circular No:-P.W.D 1359 SO/FC 2001
(P-2). The copy of government of Karnataka
Circular No:- P.W.D 1359 SO/FC 2001 (P-2) is
produced as Document No.10.
IX. Illegally accepting the substantially high
bids of M/s. Rajashree Electrical Davangere.
X. Illegally enforcing new consumers to adopt
smart meters as mandatory by issuing
Operational guidelines by B.E.S.C.O.M, which
is contrary to K.E.R.C (Prepaid Smart
Meeting) Regulations 2024, since as per the
said regulations Smart Meter was optional to
all new consumers. Further, not taking
approval of K.E.R.C under the KERC [Smart
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Grid] Regulations 2015 with public
consultations prior to taking project ahead.
The copy of K.E.R.C (Prepaid Smart Meetings)
Regulations 2024 is produced as Document
No.11. The copy of K.E.R.C (Smart Grid)
Regulations, 2015 is produced as Document
No.12. The copy of the Operational guidelines
issued by the B.E.S.C.O.M dated:-13/2/2025
is produced herewith as Document No.13.
XI. Deliberately not presenting the project to
the Council of Ministers as required under the
First Schedule of the Transaction of Business
Rules 1977, instead utilizing residual powers
of the Energy Minister, Government of
Karnataka to order other Electricity Supply
Companies of Karnataka to adopt the
ridiculous rates deliberately calculated for the
B.E.S.C.O.M Smart Meter Tender. The copy of
Karnataka Government Transaction of
Business Rules 1977 is produced as
Document No.14.
XII. If the R.D.S.S scheme is to be adopted in
Karnataka, due to the decision of Shri KJ
George in the meeting taken place at
K.R.E.D.L. on 14.10.2024 as stated in the
132nd Board Resolution, customer (who
convert the old electro-mechanical/electronic
meters to smart meter under RDSS scheme)
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of E.S.C.O.M.s of Karnataka may have to pay
Rs.75/118 per meter month to adopt the
Common A.M.I.S.P system deployed by M/s.
Rajashree Electrical Davangere in this
BESCOM SMART METER tender. It is to be
noted that common A.M.I.S.P systems across
states is not mandated by the Central
Government. This would mean that the
consumers would have to pay the Smart
Meter supplier for supply of meter and
additionally M/s. Rajashree Electrical
Davangere for integration of meter in the
common billing system of Karnataka. This is
largely due to decision taken by Shri K.J.
George."
"9. The complainants submit that actions as
described in the paragraphs 9.I to 9.XII prima
facie point to a criminal conspiracy to enable
illegal and unjust enrichment of the prima
facie shell M/s Rajashree Electrical Davangere,
which prima facie look like a front for Mr. KJ
George and other officials. Further, the mala
fide intent shown in the decision making
matrix of the various committees and officials
of B.E.S.C.O.M with blatant disregard to the
K.T.P.P norms, fiduciary responsibility to the
public at large (who are the shareholders of
the Company) under the Companies Act 2013
and the public trust doctrine as framed by the
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Supreme Court prima facie points to the fact
that the entire tender exercise was carried out
to prop up a prima facie shell company (M/s.
RajashreeElectrical Davangere) who carries
out no technical work in the tender, to award
a contract beyond his means to ensure the
completely masked additional margin so
joined may be prima facie shared / spread
across all stakeholders involved in the criminal
conspiracy at the cost of the customers of
B.E.S.C.O.M/E.S.C.O.M's across Karnataka.
Therefore, if investigation is made by
Lokayukta, the nexus between the Minister
and M/s. Rajashree Electrical Davangere can
be found out, and transactions involving the
interest of Minister with M/s M/s. Rajashree
Electrical Davangere also can be discovered."
"14. The complainants submit that as per
Government order dated 14.10.2008 bearing
No.FD 4 PCL 2008, and 19.07.2014 bearing
No.FD 480 EXP-12/2014 produced at
Document No.1 and 2, the requirement for
Earnest Money Deposit & performance bank
guarantee is as follows:-
a) The Earnest Money Deposit is to be
1% of Estimated Value of Work as per
KW-4 format. The Estimated value of
the Project is approximately
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Rs.5,296 Crores. Therefore, the EMD
for the Smart Meter tender should have
been Rs.52.96 Crores. However,
BESCOM in its tender has proposed
EMD of only Rs.10.06 Crores. This is a
gross violation of the KTPP Act and
Rules therein to ensure M/s. Rajashree
Electrical Davangere would qualify for a
tender which was beyond his capacity
to apply for.
b) Further the Performance Security as
per KW-4 format is 5% of the Contract
Price. The Contract price is Rs.5,296
Crores approximately. 5% of
Rs.5,296 Crores i.e. Rs.264.8 Crores
should have the value of Performance
Bank Guarantee as per KW-4 format.
For the Smart Meter Tender
Performance Security was illegally
reduced to Rs.4 Crores to benefit M/s.
Rajashree Electrical Davangere illegally.
Had the KW-4 norms been followed the
Performance Security and Earnest
Money Deposit would have been
significantly more than the quantum
prescribed in the B.E.S.C.O.M Smart
Meter Tender. This was done by the
Director (Technical) B.E.S.C.O.M,
Managing Director, B.E.S.C.O.M and
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Board Members in violation of the KTPP
guidelines to ensure illegally
enrichment by award of contract to
M/s. Rajashree Electrical Davangere."
"15. The complainants submit that
B.E.S.C.O.M has not called for a global
tender and has opted that only bidders
with an Electrical Class 1 License or
Super Grade License issued by the
Government of Karnataka and those
who have successfully completed as
prime contractor at least one project
involving Supply, installation and
commissioning of Single phase/Three
phase WC / Three phase LT CT / Three
phase HT consumer metering work of
value not less than 50% of the
estimated annual payment [the reduced
Rs. 107 Crores and not Rs. 2648
Crores] under this contract in the
previous five financial years in any
ESCOMS/DISCOMs.. It is to be noted
that in the KW-4 format, the bidder or
his sub-contractor credentials can be
used to be comply to this clause.
However, B.E.S.C.O.M disallowed sub-
contractor credentials to be used to
meet qualifying requirement to ensure
only the final two participants should be
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the only bidders. This was done to
ensure other national and
internationally reputed companies with
smart meter supply experience should
not be able to participate in the
B.E.S.C.O.M bid, as the bidders who
have supplied this quantum of smart
meters would not have Class-1
Electrical License or Super Grade
License issued by the Government of
Karnataka as this is the first smart
meter supply in the State of Karnataka.
However, including such a mandatory
clause, ensured that other suppliers or
vendors who would have supplied
/installed that quantum of smart
meters could not participate in the bid
as they were not Class-1 Electrical /
Super Grade Licensed Contractor.
Further, it is noted that the Karnataka
Works 4 contract has stated that 50%
of entire value of the contract the
electrical works is the quantum of
works needed to be completed to
qualify for the tender. The value of the
electrical works is Rs. 5,296 Crores
approximately. Therefore, the single
order required by the Bidder for the
Smart Meter Tender should have been
Rs. 2,648 Crores. Instead to ensure
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M/s. Rajashree Electrical Davangere
qualify for this bid, BESCOM has
amended the qualifying requirement to
50% of the estimated annual payment
illegally. This was meant to illegally
favour M/s. Rajashree Electrical
Davangere to qualify for a tender
beyond his capacity."
"16. The Complainants submits that as
per KW-4 format, the bidder should
have mandatory completed at least one
similar work of 80% of the cost of the
work costing more than Rs.100 Lakh.
Therefore, for the BESCOM smart meter
the bidder should have done one work
of Rs.4,236.8 Crores approximately to
qualify for this bid. However, the
Tender clause was illegally modified to
state that 80% of the meter quantity
should have been supplied by the
Bidder. This is a clear violation of KW-4
to illegally suite M/s. Rajashree
Electrical Davangere who had a supply
of meters of 3,20,000 meters only. The
value of the tender supply was below
Rs.200 Crores and he would not have
ordinarily qualified for this tender had
KW-4 format been followed by
BESCOM."
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"17. The complainant submits thatDraft
Board Resolution for 132nd Board
Meeting of 14th of B.E.S.C.O.M that
M/s. Rajashree Electrical Davangere
has quoted 18% above Estimated Value
of B.E.S.C.O.M and negotiations have
been carried out to reduce quoted
prices in the bid. As per guidelines
issued by Karnataka Government for
conducting negotiation, it is stated that
negotiations is to be avoided in
substantially high bids, wherein
substantially high bids are considered
bids above 10% of estimated value.
Further, bids which are substantially
high should be rejected at first choice
and retendered. In the present case,
the bids were negotiated further, as can
be seen in the price variation between
the Board Resolution prices listed, this
is highly irregular and should be
investigated. The Board of Directors
illegally allowed for negotiations
contrary to Government of Karnataka
order bearing No:-PWD 1359 SO/FC
2001 dated 3rd December 2002 to
retender bids to tender which are 10%
higher than estimated costs."
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"20. The Chairman of the Board of
B.E.S.C.O.M directed the other ESCOMs
of Karnataka to procure the meters at
substantially high rates discovered by
B.E.S.C.O.M in 132nd Board Meeting
vide the use of his powers as Energy
Minister, Government of Karnataka
under the Transaction of Business Rules
1977. The Decision by Energy Minister
directing other E.S.C.O.M's across
Karnataka State to award contract
directly to M/s Rajashree Electricals
Davangere without calling for tender, is
in direct violation of K.T.P.P Act. In
regular course of the Transaction of
Business Rules 1977 such a policy
decision had to referred to the Council
of Ministers for approval prior to
resolving to undertake such a major
change in policy decision by not
allowing the other E.S.C.O.Ms to call
tenders of their own, i.e., for selection
of their A.M.I.S.P is blatant violation of
the administrative norms, it was done
intentionally by the Hon'ble Energy
Minister, GOK to ensure M/s. Rajashree
Electrical was able to quote high rates
to a tender that he was the only one
who could qualify for the same. Further,
the Board of BESCOM is complicit in
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accepting substantially high bids while
illegally authorizing the Managing
Director, B.E.S.C.O.M to negotiate with
M/s. Rajashree Electrical Davangere
which was contrary to law. Additionally,
the Chairman of the Board of B.E.S.O.M
Sri. K.J. George and other members
such as Sri Gaurav Gupta Additional
Chief Secretary Energy Department. Sri
Mahantesh Bilagi, Former B.E.S.C.O.M
Managing Director Sri. Ramesh H.G,
B.E.S.C.O.M Director Technical, Balaji
B.E.S.C.O. Deputy General Manager has
illegally used their administrative
powers to enforce the other ESCOMs of
Karnataka to adopt these rates vide the
Board Resolution of BESCOM in direct
contravention of K.T.P.P guidelines for
the illegal enrichment of M/s. Rajashree
Electrical Davangere through this
criminal conspiracy."
7. Based on the aforementioned allegations, the
complainants have sought to prosecute the accused for
the offences punishable under Sections 314, 316 and
61 of the Bharatiya Nyaya Sanhita, 2023 read with
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Sections 13(1)(a) and 13(1) (b) of the Prevention of
Corruption Act, 1988.
8. Based on the allegations made in the complaint
accompanied by an affidavit as contemplated under
Section 173(4) of the Bharatiya Nagarik Suraksha
Sanhita, 2023 (for short 'BNSS'), and after hearing the
complainants, the trial Court framed the following
points for consideration and has answered the same as
follows:-
"4. Heard the learned Senior Counsel
and perused the records. The points that
would arise for my consideration are:
1. Whether complainants have
made out grounds to call for
Report from the competent
authorities:
2. What order?
5. My finding to the aforesaid points are
as follows:
Point No.1: In the Affirmative
Point No.2: As per final orders."
And has passed the following order:-
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ORDER
"Acting under Sec.175(4) of
Bharatiya Nagarik Suraksha Sanhita 2023,
it would be appropriate to call for Report
from the Superintendent of Police,
Karnataka Lokayuktha, Bengaluru, to file
his Report on or before the next date of
hearing.
Office is hereby directed to register
the complaint as PCR and shall furnish
necessary intimation to the concerned
Lokayuktha Authorities with respect to the
Report called by this Court."
9. Aggrieved by the same, the present criminal
petitions are filed by accused Nos.1, 3 and 4.
10. The case of accused Nos.1, 3 and 4 is that the
allegations made in the complaint are all false and
frivolous and are not supported by any material. It is
submitted that the trial Court has failed to hear
accused Nos.1, 3 and 4 before passing the impugned
order. It is also submitted that the trial Court has
passed the impugned order in violation of Section 17A
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of the Prevention of Corruption Act, 1988 (for short 'the
P.C. Act') and also in violation of the procedure laid
down under Section 175(4) of BNSS. It is further
submitted that, even otherwise, no reliable or
believable material is produced along with the
complaint. The trial Court, without applying its mind,
only based upon the wild allegations made against the
accused, has passed the impugned order erroneously.
It is also further submitted that even allegations made
in the complaint do not constitute any offence as
contemplated under the Prevention of Corruption Act,
1988 or the Bharatiya Nagarik Suraksha Sanhita, 2023.
11. Based on the submissions made by accused
Nos.1, 3 and 4, the points that arise for consideration
are:-
i. Whether the trial Court has committed
any procedural illegality while passing the
impugned order?
ii. Even presuming that there is no
procedural illegality as alleged, whether the
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allegation made in the complaint constitute
any offence under the P.C. Act or BNSS as
alleged?
iii. Whether the material provided along with
the complaint supports the allegations made
in the complaint and whether the trial Court
was required to examine the same in detail
before passing the impugned order and did it
erred in not doing so?
12. Admittedly, the accused Nos.1, 3 and 4 are public
servants, and the law contemplates certain safeguards
for the actions of the public servant, which they have
done in discharge of their official duties as public
servants.
13. Section 17A of the P.C. Act reads as under:-
"17A. Enquiry or Inquiry or
investigation of offences relatable to
recommendations made or decision
taken by public servant in discharge of
official functions or duties.-No police
officer shall conduct any enquiry or inquiry
or investigation into any offence alleged to
- 26 -
have been committed by a public servant
under this Act, where the alleged offence is
relatable to any recommendation made or
decision taken by such public servant in
discharge of his official functions or duties,
without the previous approval-
(a) in the case of a person who is
or was employed, at the time
when the offence was alleged
to have been committed, in
connection with the affairs of
the Union, of that
Government;
(b) in the case of a person who is
or was employed, at the time
when the offence was alleged
to have been committed, in
connection with the affairs of a
State, of that Government;
(c) in the case of any other
person, of the authority
competent to remove him from
his office, at the time when the
offence was alleged to have
been committed:
Provided that no such approval shall
be necessary for cases involving arrest of a
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person on the spot on the charge of
accepting or attempting to accept any
undue advantage for himself or for any
other person:
Provided further that the concerned
authority shall convey its decision under
this section within a period of three
months, which may, for reasons to be
recorded in writing by such authority, be
extended by a further period of one
month."
14. Section 175(3) and (4) of BNSS reads as under:-
"175. Police officer's power to
investigate cognizable case.-
(1) xxx
(2) xxx
(3) Any Magistrate empowered under
section 210 may, after considering the
application supported by an affidavit made
under sub-section (4) of section 173, and
after making such inquiry as he thinks
necessary and submission made in this
regard by the police officer, order such an
investigation as above-mentioned.
(4) Any Magistrate empowered under
section 210, may, upon receiving a
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complaint against a public servant arising
in course of the discharge of his official
duties, order investigation, subject to-
(a) receiving a report containing
facts and circumstances of the
incident from the officer
superior to him; and
(b) after consideration of the
assertions made by the public
servant as to the situation that
led to the incident so alleged."
15. The case of accused Nos.1, 3 and 4 is that the
impugned order has the effect of ordering an enquiry or
investigation in relation to an offence relatable to
recommendations made or decisions taken by accused
Nos.1, 3 and 4 (public servants) in discharge of their
official functions and duties without obtaining the
necessary sanction as contemplated under Section 17A
of the P.C. Act. It is submitted that accused No.1 is the
Energy Minister of the State of Karnataka and the
offences alleged pertain to the decision taken by him
while discharging his duties as a Minister and an
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enquiry or investigation could not have been ordered
without there being a prior sanction obtained from His
Excellency the Governor. It is submitted that the
impugned order is passed under Section 175(4) of
BNSS and even as per the said Section, an order under
Section 175(4) could not have been passed by the trial
Court without obtaining a report from His Excellency
the Governor. It is submitted that the trial Court could
not have ordered the Lokayuktha Police to submit a
report.
16. Per contra, learned Senior counsel appearing for
the complainants submits that the impugned order is
not passed under Section 175(4) of BNSS, but under
Section 175(3) of BNSS. Reliance is placed on the
judgment of the Apex Court in the case of N.MANI v.
SANGEETHA THEATRE AND OTHERS reported in
(2004) 12 SCC 278 wherein in para 9, it has been
held as under:-
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"9. It is well settled that if an authority has a
power under the law merely because while
exercising that power the source of power is
not specifically referred to or a reference is
made to a wrong provision of law, that by
itself does not vitiate the exercise of power so
long as the power does exist and can be
traced to a source available in law."
17. Based on the aforementioned judgment, it is
contended that mentioning of Section 175(4) of BNSS
in the impugned order is a typographical error and it
has to be read as Section 175(3) and it cannot be fatal
to the order passed by the trial Court.
18. It is submitted that when the jurisdictional Police
refused to receive information provided to them in
respect of a cognizable offence and act on it, the
complainant has the option to file a complaint before
the jurisdictional Magistrate under Section 173(4) of
BNSS and in the instant case, as the Lokayuktha Police
refused to register the complaint, the complainants
have been forced to approach the Special Court by
filing a PCR as contemplated under Section 173(4) of
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BNSS. Upon receipt of the complaint, it is submitted
that the Magistrate has to initially proceed under
Section 175(3) of BNSS, wherein the Magistrate after
considering the application supported by an affidavit
and after making such enquiry, as he thinks necessary,
he may call for a report from the jurisdictional Police
and after submission is made to him in this regard by
the Police Officer, if the accused is a Public Servant
then follow the procedure as contemplated under
Section 175(4) of BNSS. It is submitted in the instant
case, after receipt of the complaint, as the allegations
made therein and the materials produced along with
the complaint constitute an offence under various
provisions of the Prevention of Corruption Act, 1988
and the Bharatiya Nagarik Suraksha Sanhita, 2023, the
trial Court has directed the Lokayuktha Police to submit
a report. It is submitted that there is no error in the
same. It is further submitted that by mistake instead
of mentioning Section 175(3), Section 175(4) is
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mentioned in the order portion of the impugned order
and the accused taking advantage of it, is trying to
confuse the Court by stating that the procedure as
contemplated under Section 17A of the P.C. Act as well
as Section 175(4) of BNSS has not been followed. It is
submitted that the safeguards contemplated under
Section 17A of the P.C. Act and Section 175(4) of BNSS
comes into effect only after the Lokayuktha Police
submit a report and after analyzing the same, the trial
Court comes to a conclusion that it is a fit case to
proceed with. It is further submitted that by way of
impugned order, the trial Court has not taken
cognizance of the offence, but has merely called for a
police report, to facilitate the Court to take a decision
as to whether there is any prima facie case in the
allegations made by the complainants or not.
19. Thus, under the circumstances, I am of the
opinion that the order passed by the trial Court has to
be considered as an order passed under Section 175(3)
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and not under Section 175(4) of the BNSS. However,
the question still remains whether the trial Court under
the given peculiar facts and circumstances of the case,
should have called for a report from the Lokayuktha
Police or rejected the petition at the preliminary stage
itself.
20. As can be seen from the allegations made by the
complainants against the accused, it pertains to the
manner in which the tender process has been
conducted and the contract has been awarded in favour
of the successful bidder. Under the circumstances, it is
required to examine that even presuming the
allegations made in the complaint are true regarding
the specific instances of infraction alleged in the tender
process and the awarding of the contract in favour of
the successful bidder, whether they constitute the
offences as alleged in the complaint. Only if the same
can be answered in the positive then only the trial
- 34 -
Court should have called for a report from the
Lokayuktha Police.
21. The case of the complainants is that the incidents
of infractions alleged do constitute the offences as
alleged in the complaint. Per contra, the submission of
the accused is that the acts do not constitute the
offences as alleged.
22. In the course of the proceedings the Lokayuktha
Police have filed a report in respect of the tender
process. It is submitted by the counsel for the
Lokayuktha that as per the terms and conditions of the
eligibility criteria prescribed in the tender document,
there were several eligible persons competent to bid for
the contract. However, only three persons made a bid
and amongst them, the successful bidder turned out to
be L-1 and after negotiation and reducing the rates
even further, he has been selected and has been
awarded the contract.
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23. The aforementioned statement is not disputed
either by the complainants or the accused.
24. Perusal of the tender document reveals that it
comprises the following:-
"The Tender documents comprises of
the following:
• Detailed Scope of Work.
• Instructions to Bidders.
• General Conditions of Contract.
• Special Conditions of Contract.
• Annexure A - Smart Meters
Specifications
• Annexure B - Communications
Systems
• Annexure C-Retail Outlets
• Annexure D IT Systems
• Annexure E-NOMC Specifications
• Annexure F - Service Level
Agreement
• Annexure G - AMI System
Availability
• Annexure H - Terms and
Conditions of Payment."
- 36 -
25. Section 314 of the Bharatiya Nyaya Sanhita, 2023
reads as under:-
"314. Dishonest misappropriation of
property. - Whoever dishonestly
misappropriates or converts to his own use
any movable property, shall be punished with
imprisonment of either description for a term
which shall not be less than six months but
which may extend to two years and with fine."
26. Section 316 of the Bharatiya Nyaya Sanhita, 2023
reads as under:-
"316. Criminal breach of trust.- (1) Whoever,
being in any manner entrusted with property, or
with any dominion over property, dishonestly
misappropriates or converts to his own use that
property, or dishonestly uses or disposes of that
property in violation of any direction of law
prescribing the mode in which such trust is to be
discharged, or of any legal contract, express or
implied, which he has made touching the
discharge of such trust, or wilfully suffers any
other person so to do, commits criminal breach of
trust.
- 37 -
Explanation 1.--A person, being an employer of an
establishment whether exempted under section 17
of the Employees' Provident Funds and
Miscellaneous Provisions Act, 1952 (19 of 1952) or
not who deducts the employee's contribution from
the wages payable to the employee for credit to a
Provident Fund or Family Pension Fund established
by any law for the time being in force, shall be
deemed to have been entrusted with the amount
of the contribution so deducted by him and if he
makes default in the payment of such contribution
to the said Fund in violation of the said law, shall
be deemed to have dishonestly used the amount
of the said contribution in violation of a direction
of law as aforesaid.
Explanation 2.--A person, being an employer, who
deducts the employees' contribution from the
wages payable to the employee for credit to the
Employees' State Insurance Fund held and
administered by the Employees' State Insurance
Corporation established under the Employees'
State Insurance Act, 1948 (34 of 1948) shall be
deemed to have been entrusted with the amount
of the contribution so deducted by him and if he
makes default in the payment of such contribution
to the said Fund in violation of the said Act, shall
be deemed to have dishonestly used the amount
of the said contribution in violation of a direction
of law as aforesaid.
- 38 -
Illustrations
(a) A, being executor to the will of a deceased
person, dishonestly disobeys the law which directs
him to divide the effects according to the will, and
appropriates them to his own use. A has
committed criminal breach of trust.
(b) A is a warehouse-keeper Z going on a journey,
entrusts his furniture to A, under a contract that it
shall be returned on payment of a stipulated sum
for warehouse room. A dishonestly sells the goods.
A has committed criminal breach of trust.
(c) A, residing in Kolkata, is agent for Z, residing
at Delhi. There is an express or implied contract
between A and Z, that all sums remitted by Z to A
shall be invested by A, according to Z's direction.
Z remits one lakh of rupees to A, with directions to
A to invest the same in Company's paper. A
dishonestly disobeys the directions and employs
the money in his own business. A has committed
criminal breach of trust.
(d) But if A, in illustration (c), not dishonestly but
in good faith, believing that it will be more for Z's
advantage to hold shares in the Bank of Bengal,
disobeys Z's directions, and buys shares in the
Bank of Bengal, for Z, instead of buying
Company's paper, here, though Z should suffer
loss, and should be entitled to bring a civil action
against A, on account of that loss, yet A, not
- 39 -
having acted dishonestly, has not committed
criminal breach of trust.
(e) A, a revenue-officer, is entrusted with public
money and is either directed by law, or bound by
a contract, express or implied, with the
Government, to pay into a certain treasury all the
public money which he holds. A dishonestly
appropriates the money. A has committed criminal
breach of trust.
(f) A, a carrier, is entrusted by Z with property to
be carried by land or by water. A dishonestly
misappropriates the property. A has committed
criminal breach of trust.
(2) Whoever commits criminal breach of trust shall
be punished with imprisonment of either
description for a term which may extend to five
years, or with fine, or with both.
(3) Whoever, being entrusted with property as a
carrier, wharfinger or warehouse-keeper, commits
criminal breach of trust in respect of such
property, shall be punished with imprisonment of
either description for a term which may extend to
seven years, and shall also be liable to fine.
(4) Whoever, being a clerk or servant or employed
as a clerk or servant, and being in any manner
entrusted in such capacity with property, or with
- 40 -
any dominion over property, commits criminal
breach of trust in respect of that property, shall be
punished with imprisonment of either description
for a term which may extend to seven years, and
shall also be liable to fine.
(5) 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
imprisonment for life, or with imprisonment of
either description for a term which may extend to
ten years, and shall also be liable to fine."
27. Section 13(1) (a) and 13(1) (b) of the Prevention
of Corruption Act reads as under:-
13. Criminal misconduct by a public
servant.-- (1) A public servant is said to
commit the offence of criminal misconduct,--
(a) if he dishonestly or fraudulently
misappropriates or otherwise converts for his
own use any property entrusted to him or any
property under his control as a public servant
or allows any other person so to do; or
- 41 -
(b) if he intentionally enriches himself illicitly
during the period of his office."
28. It is not the case of the petitioners that the
accused took money at the time of awarding the
contract to the successful bidder. But it is their case
that the entire tender process was designed to favour
the successful bidder and that the contract has been
awarded in favour of the successful bidder which is a
shell company and front of accused No.1 so that
accused No.1 gets unjustly enriched.
29. Admittedly, several persons were eligible to
participate in the tender process. It is not that
anybody has been illegally disqualified. Further, there
were three bidders for the contract. The same has
been done transparently. No favour has been shown to
the successful bidder in this regard. Allegations of the
provisions of the Karnataka Transparency in Public
Procurements Act, 1999 (for short 'the KTPP Act') being
- 42 -
violated or any other improper method of tender
process and awarding of the contract, may give rise to
a civil cause of action, for the concerned parties who
were desirous of making a bid for the contract or it can
also be a matter of public interest litigation. However,
when the bid was invited by all the eligible persons and
there were several of them who could have participated
and from the persons who have participated, the
tender being awarded in favour of the successful
bidder, no criminality can be attributed to the accused
in the awarding of the contract. It is not the case of
the complainants that after finalizing the terms and
conditions of the tender document, when the contract
was awarded to the successful bidder, the terms and
conditions of the tender document have been altered or
flouted to favour the successful bidder. Infact, the
BESCOM has subsequently negotiated with the
successful bidder to the terms more favorably to the
BESCOM.
- 43 -
30. Further, Sections 314 and 316 of the Bharatiya
Nyaya Sanhita, 2023, does not attribute any dishonest
intention on part of the accused at the time of floating
the tender document. It can be attracted only
thereafter. Even otherwise, as already mentioned
above, the manner in which the tender has been
floated and the terms and conditions of the contract are
mentioned, at the maximum the same can be
challenged to be in violation of the KTPP Act, but
definitely no criminality can be attributed to the
accused.
31. As already mentioned above, after the tender was
awarded to the successful bidder, negotiations have
taken place and no additional benefit has been given to
the successful bidder. Whatever changes have taken
place are for the benefit of the State or as a natural
consequence of the business transactions, for which no
criminality can be attributed to the accused.
- 44 -
32. The trial Court without applying its mind to the
allegations in the contract, has called for a report from
the Lokayuktha, which in my opinion, is erroneous.
33. During the course of the proceedings, it is
submitted that accused No.3 has died.
34. Hence, the following:-
ORDER
i. The proceedings against accused No.3
stands abated.
ii. The criminal petitions are allowed.
iii. Consequently, the proceedings initiated in
PCR No-Nil/2025 (presently numbered as PCR
No.24/2025) pending on the file of the LXXXI
Additional City Civil and Sessions Judge,
Bengaluru (CCH 82), against the petitioners
herein stands quashed.
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iv. Pending interlocutory applications, if any,
stand disposed of.
Sd/-
(M.I.ARUN)
JUDGE
VMB
