Madras High Court
The State By Cbi vs M.Kalaivanan on 20 October, 2021
1
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 20.10.2021
CORAM
THE HON'BLE Mr. JUSTICE C.V.KARTHIKEYAN
Crl.A.No. 45 of 2010
The State by CBI
Rep. by its Deputy Superintendent
of Police, CBI/ACB,
Chennai.
... Appellant/Complainant
Vs.
1. M.Kalaivanan
2. Dhikpathy
3. Muthu Srinivasan
4. V.S.Ranganathan
5. K.C.Raman
6. S.B.Rao
7. M/s. X-Press Container Lines
C/o. M/s. Patvolk, No.19, J.N. Herediya Marg, Ballard Estate,
Mumbai -1.
... Respondents/ Accused 1 to 7
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2
Prayer: Criminal Appeal filed under Section 378 (2) Cr.P.C., against the
order of the Principal Judge CBI Cases, Chennai, in C.C.No. 16 of 1999
dated 09.09.2009 acquitting the accused under Section 120-B of IPC read
with 420 IPC read with 13(2) read with 13(1)(d) of the Prevention of
Corruption Act 1988 and specific offences under Section 420 IPC and under
Section 13(2) read with 13(1)(d) of P.C.Act 1988.
***
For appellant : Mr. Ashok Kumar Gowtham
Special Public Prosecutor
for CBI Cases
For R-1 : Mr. L.Rajasekar
For R-2 to R-4 : Mr. V.Krishnakumar
For R-5 to R-7 : G.Ravikumar
ORDER
The prosecution is on appeal questioning the acquittal of all the
accused by Judgment dated 09.09.2009 by the Principal Special Judge for
CBI Cases at Chennai in C.C.No. 16 of 1999 which Calendar Case had been
taken cognizance pursuant to investigation in First Information Report in
R.C.No. 15(A)/1996 which had been registered on information received on
21.03.1996 under Sections 120-B read with Section 420 IPC and also under
Section 13(2) read with 13(1)(d) of P.C. Act 1988. After investigation, as
stated final report had been laid against the seven accused.
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2. A-1 was the Chairman of Madras Port Trust. A-2 was the
traffic Manager, A-3 was FA & CAO and A-4, Additional Chief Accounts
Officer. A-5 to A-7 are private individuals. I am in formed that A-4
V.S.Ranganathan has unfortunately expired during the pendency of the
criminal appeal. At any rate, since he had been acquitted of all charges by
the learned trial Judge, nothing needs to be adjudicated with respect to him.
3. It had been alleged that A-2 had initiated a proposal to A-1 to
permit container shipping lines to take advantage of 200 mtrs berth length
under private participation scheme for the purpose of berthing licensee
vessels for the purpose of loading and unloading of containers. This was
approved by A-1 in his capacity as Chairman of Madras Port Trust.
4. It is also claimed that necessary approval had been obtained
from the Madras Port Trust Board. Thereafter, an advertisement had been
issued which had been marked as Ex.P-5 inviting participants to avail the
said 200 mtrs at berth length under private participation scheme.
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5. The allegation of the prosecution is that this advertisement had
been issued without obtaining prior permission of the Central Government
as necessitated under Section 42(3) of the Major Port Trust Act. It is also
claimed that A-1 to A-4 had wilfully granted the contract to A-5 to A-7 and
had omitted to grant the contract to another participant in the tender, who
would have provided more profit to the Madras Port Trust. However,
without going into any further discussion, I must point out that there has
been a specific finding by the learned trial Judge that the said loss was only
hypothetical in nature and it was also stated that there has been no actual
loss by the Madras Port Trust.
6. Claiming that there has been violation of procedure in not
obtaining prior sanction from the Central Government in issuing such
advertisement, namely, Ex.P-5, the First Information Report had been
registered on source information and subsequently, after investigation, the
final report had been laid before the competent Court which had taken
cognizance of the same as C.C.No. 16 of 1999. Summons had been directed
to the accused, who entered appearance and thereafter copies under Section
207 Cr.P.C., had been furnished to all the accused. Charges had also been
framed.
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7. The first charge was a comprehensive charge under Section
120-B IPC read with Section 420 IPC read with 13(2) read with 13(1)(d) of
P.C. Act, 1988 as against A-1 to A-7. The second charge was against A-1,
A-2, A-5, A-6 and A-7 for offence punishable under Section 420 IPC. The
third charge was against A-1 for offence punishable under Section 13(2)
read with 13(1)(d) of P.C. Act, 1988. The fourth charge was against A-2 for
offence punishable under Section 13(2) read with 13(1)(d) of P.C. Act,
1988. The fifth charge was against A-3 for offence punishable under
Section 13(2) read with 13(1)(d) of P.C. Act, 1988. The sixth charge was
against A-4 for offence punishable under Section 13(2) read with 13(1)(d)
of P.C. Act, 1988.
8. The accused when questioned abjurred the charges and
therefore, the learned trial Judge invited the prosecution to prove the
charges. Accordingly, the prosecution examined PW-1 to PW-22 as
witnesses. On the side of the accused, witnesses were not examined.
Prosecution also marked Exs. P-1 to P-71. On the side of the accused,
Ex.D-1 was marked. The learned Judge, after examination of the
prosecution witnesses also questioned the accused under Section 313
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Cr.P.C., with respect to the incriminating evidence adduced as against them
and their explanations were noted. Finally, by Judgment dated 09.09.2009
on appreciation of the documentary and oral evidence adduced, the learned
Judge had thought it fit to acquit the accused of all the charges. As stated,
the prosecution is now in appeal as against such acquittal.
9. Heard Mr. Ashok Kumar Gowtham, learned Special Public
Prosecutor, for CBI Cases, Mr. L.Rajasekar, learned counsel for the first
respondent, Mr.V.Krishnakumar, learned counsel for the second to fourth
respondents and Mr.G.Ravikumar, learned counsel for the fifth to seventh
respondents. As pointed out earlier, A-4 had unfortunately died during the
pendency of the present Criminal Appeal.
10. The entire charge of the prosecution surrounds issuance of the
advertisement for allotment of 200 mtrs of berth for private participation to
to permit to dock the vessels in order to load and unload containers by
berthing the vessels in the said area / quay, license fee and rent could be
collected which would only add to the profits of the Madras Port Trust.
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11. In this connection, Section 42 of the Major Port Trust Act will
make quite relevant:-
“42. Performance of services by Board or
other person.—
(1) A Board shall have power to undertake
the following services:—
(a) landing, shipping or transshipping
passengers and goods between vessels in the port
and the wharves, piers, quays or docks belonging
to or in the possession of the Board;
(b) receiving, removing, shifting,
transporting, storing or delivering goods brought
within the Board’s premises;
(c) carrying passengers by rail or by other
means within the limits of the port or port
approaches, subject to such restrictions and
conditions as the Central Government may think
fit to impose;
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(d) receiving and delivering, transporting
and booking and despatching goods originating in
the vessels in the port and intended for carriage by
the neighbouring railways, or vice versa, as a
railway administration under the Indian Railways
Act, 1890 ( 9 of 1890);
(e) piloting, hauling, mooring, remooring,
hooking, or measuring of vessels or any other
service in respect of vessels;]
(f) developing and providing, subject to the
previous approval of the Central Government,
infrastructure facilities for ports.]
(2) A Board may, if so requested by the
owner, take charge of the goods for the purpose of
performing the service or services and shall give a
receipt in such form as the Board may specify.
(3) Notwithstanding anything contained in
this section, the Board may, with the previous
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sanction of the Central Government, authorise any
person to perform any of the services mentioned in
sub-section (1) on such terms and conditions as
may be agreed upon.
(3A) Without prejudice to the provisions of
sub-section (3), a Board may, with the previous
approval of the Central Government, enter into
any agreement or other arrangement (whether by
way of partnership, joint venture or in any other
manner) with, any body corporate or any other
person to perform any of the services and
functions assigned to the Board under this Act on
such terms and conditions as may be agreed
upon.]
(4) No person authorised under sub-section
(3) shall charge or recover for such service any
sum in excess of the amount 5 [specified by the
Authority, by notification in the Official Gazette].
(5) Any such person shall, if so required by
the owner, perform in respect of goods any of the
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said services and for that purpose take charge of
the goods and give a receipt in such form as the
Board may specify.
(6) The responsibility of any such person for
the loss, destruction or deterioration of goods of
which he has taken charge shall, subject to the
other provisions of this Act, be that of a bailee
under sections 151, 152 and 161 of the Indian
Contract Act, 1872 ( 9 of 1872).
(7) After any goods have been taken charge
of and a receipt given for them under this section,
no liability for any loss or damage which may
occur to them shall attach to any person to whom
a receipt has been given or to the master or owner
of the vessel from which the goods have been
landed or transhipped.”
12. Sub-Section (1) of the said provision enumerates the list of
activities which can be carried out by the Port Trust and Sub-Section (3)
also states that some of the activities listed above under Sub-Section (1) can
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be carried out with the permission of previous sanction or permission by the
Central Government.
13. Much emphasis had been made by Mr. Ashok Kumar
Gowtham, learned Special Public Prosecutor for CBI Cases, with respect to
the issuance of advertisement. It is claimed that such advertisement,
namely, Ex.P-5 had been issued without prior sanction of the Central
Government. It had been stated that therefore, there had been violation of a
statutory provision and necessarily the accused should be held answerable
and punishable for such an act and it is therefore urged that this Court
should revisit the Judgment acquitting them all of the charges.
14. Heard also arguments advanced by the learned counsels on
behalf of the accused.
15. I have given careful thought to the arguments advanced.
16. I hold that the Court should give a broader construction with
respect to he interpretation of Section 42 of the Major Port Trust. Section
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42(1) deals with the list of activities which the Port Trust shall undertake
and the nature of activities have been enumerated. Sub-Section (3) however
begins with a non obstante clause, “notwithstanding” and therefore would
mean that dehors whatever has been stated in Sub-Section (1) or in Sub-
Section 2 under Section 42, the Board may “with the previous sanction of
the Central Government do any of the activities as stated in Sub-Section (1)
of Section 42”.
17. Naturally, this revolves around interpretation of the said
provision. Sub-section (1) grants the Port Trust authorities to do any of the
activities mentioned therein and the word used is “shall” and further
clarified under Sub-section (3) wherein the mandate was laid to get previous
sanction of the Central Government.
18. A question has now come up for consideration particularly
because an omnibus charge has been framed as against the A-1 to A-4,
namely, that not only did they issue the advertisement Ex.P-5 without the
previous sanction of the Central Government but they had also entered into
an agreement with A-5, A-6 and A-7 to the detriment of the Madras Port
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Trust. Therefore both acts complained had been combined into one
particular charge. The learned Judge had combined both the allegations but
as is evident, the words under Section 42 Sub-clause 3, namely that the Port
Trust “may.....perform” any of the acts under Sub-clause (1) would only
indicate entering into an agreement with the successful tenderer.
19. This would actually mean committing and binding the Port
Trust into a contractual relationship with the successful tenderer. Issuing an
advertisement does not bring about any commitment on the part of the Port
Trust. They may receive applications and later, there is always a window
for the Port Trust or for that matter any organisation which issues an
advertisement to walk away from what had been stated in the advertisement.
20. An advertisement is only an invitation seeking offers. Such an
invitation can always be withdrawn. Issuing of an advertisement in its strict
sense does not require any previous sanction of any authority. In the instant
case, it is pointed out that the Port Trust particularly the Trustees of the
Madras Port Trust had taken a decision to issue such an advertisement
calling for participants with respect to licensing 200 mts of berth place for
vessels to be utilised for unloading and loading the containers.
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21. The second act after issuing the advertisement is on receipt of
the various bids by the participants and after centralising around one
particular tenderer to be awarded the contract, actually entering into such a
contract. This creates a binding contractual relationship between the Port
Trust and the particular individual with whom such a contract is entered
into. This has to be contrasted with the act of issuing an advertisement
which does not create any binding contractual relationship with any one of
the participants, who answers to such a publication. Therefore, the
contention of the learned Special Public Prosecutor that Ex.P-5 had been
issued in violation of Section 42(3) cannot be countenanced by this Court.
22. The second aspect of entering into the agreement as seen from
the records has been done after following due procedure. While entering
into any agreement, there is always an application of mind and subjective
satisfaction of the authority, who enters into such a contract.
23. Here, A-5, A-6 and A-7 been granted the contract. As had
already been pointed out, there has been no tangible loss suffered by the
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Port Trust. The final report only projected loss on the basis that if any other
tenderer had been chosen then the returns of the Port Trust would have
been higher. But there again, a question mark remains. This assertion is a
little too hypothetical and too far fetched to enable a conclusion to be
reached that the other tenderer would have performed the obligation under
the contract without causing any further loss or frustration to the contract
during the period of contract. Therefore I hold that the said argument again
cannot be accepted. What then remains is whether the contract entered into
with the A-5, A-6 and A-7 was executed after obtaining necessary
permission and after following due procedure.
24. In this regard, it is not the case of the prosecution that such
procedure were not followed. The tenders received had passed through a
Special Committee nominated for that particular purpose. It had finally
been approved by the Trustees of the Madras Port Trust. Neither the
Special Committee members nor the Trustees of the Madras Port Trust had
been arranged as accused in this case. They had actually approved the
tender granted to A-5 to A-7. In the course of the Judgement, there has
been a discussion by the learned trial Judge with respect to applicability of
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Section 319 Cr.P.C., and the learned Judge had thereafter come to a
conclusion that they cannot be arrayed as accused on the basis of the
evidence available.
25. The above discussion points out to only narrow facts, namely,
the advertisement issued, the tenders received, the processing through the
vetting by a Sub Committee and approval by the Trustees of the Madras
Port Trust.
26. The role of A-1 or even A-2 was that they had initialised this
particular advertisement. A-2, particularly had been instrumental in
suggesting the particular project. A-1 is said to have approved of the
project. A-1 is said to have caused publication to be issued. Thereafter, the
process went through its normal course. The final approval was by the
Trustees of the Madras Port Trust. The loss is only hypothetical and was a
projected loss and it is not the case of the prosecution that actual monetary
loss was suffered by the Madras Port Trust.
27. To interfere with a Judgment of an order of acquittal,
prosecution will have to rely on evidence which has not been considered by
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the learned Judge or on evidence which have been perversely interpreted by
the learned Judge. These are not points put forth during the course of
arguments. What has been repeatedly stated is the fact of issuing of
advertisement primarily and not even about the award of contract. As
pointed out above, issuing the advertisement does not create, by any stretch
of imagination, a contractual relationship by the Port Trust with any one of
the participants or with those who answer to the advertisement. It is only an
invitation. It is not a binding contract in itself.
28. In Bhagwan Singh and others Vs. State of Madhya Pradesh,
(2002) 4 SCC 85, the Hon'ble Supreme Court held as follows:-
"the golden thread which runs through the web of
administration of justice in criminal case is that if
two views are possible on the evidence adduced in
the case, one pointing to the guilt of the accused
and the other to his innocence, the view which is
favorable to the accused should be adopted."
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29. In view of these reasons even though I am not entering into a
complete discussion on the evidence adduced which I hold is actually not
required in the present case, I would dismiss the present Criminal Appeal.
30. Accordingly, the Criminal Appeal is dismissed.
20.10.2021
Index:Yes/No
Internet:Yes/No
vsg
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C.V.KARTHIKEYAN, J
vsg
Crl.A.No. 45 of 2010
20.10.2021
https://www.mhc.tn.gov.in/judis/
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