AI Structured Summary
Not yet generated for this judgment
Judgment
Prakash Chandra Verma and Aditya Kumar Trivedi, JJ.—These writ petitions have been filed by the petitioners by way of Public Interest Litigation seeking a writ of mandamus directing the C.B.I, to investigate and institute a case against the State of Bihar. Learned Counsel for the petitioners Mr. Dinu Kumar has made elaborate submission and stated that this Public Interest Litigation has been filed for direction to the State respondents to institute a case and get it investigated/enquired into by the C.B.I. with regard to the misappropriation/defalcation of the Government money to the tune of Rs. 11412.54 crores as per the CAG report ending upto 31.3.2008 for the financial years 2002-03 to 2007-08 relating to NREGA (now MNREGA), Mid-Day-Meal, Indira Awas and other schemes, Urban Development Department, Education Department, Welfare Department and also for directing the respondents to take/recover the misappropriated/defalcated amount as disclosed in the CAG Report for financial year 2007-08 and also for directing the respondents to forthwith take disciplinary action against the Government Officials for misappropriating the Government money and not monitoring the Scheme properly, causing loss to the Government and also for other reliefs for which the petitioners may be found entitled in the eyes of law as well as facts and circumstances of the case.
He has further submitted that the petitioners filed the aforesaid writ application on the basis of CAG Report, official documents, complaint of muster roll labourers, communication made by the Chairman, Zila Parishad, Arwal, Rohtas, East Champaran and Report of Examiner of Local Accounts, Bihar for the year ending upto 31.3.2008 Panchayati Raj Institution Government of Bihar which are enclosed as Annexures-1, 6, 7, 8, 9, 9A, 10, 12, 14, 16, 17, 21, 22, 23 to 31 to the writ application.
It is evident from Annexure-1, pages-53 and 54 of the writ application about excess expenditure amounting to Rs. 7026.26 crores till September, 2008 has not been regularized under Article 205 of the Constitution of India which cannot be denied financial irregularity. The CAG Report at Page-54 of the writ application describes that Rs. 271.46 crores has been expending without any provision. There has been unnecessary supplementary budget amounting to Rs. 1292.10 crores for the period August 2007-08. Annexure-1, Page-56 of the writ application further speaks that Rs. 31614.65 crores has not been reconciled. The petitioners have also brought the documents on record, in which extract version of CAG report showing Rs. 4027 crores is outstanding utilization certificate upto October, 2007. It is also evident from Annexures-6 to 8, pages-66 to 72 that under the Schemes out of 250 schemes, under Rojgar Guarantee Yojana NREGA, Rs. 64.70 crores has been misappropriated which is fit to be recovered. Rest 224 Schemes under Arwal District are fit to be recommending for enquiry by Vigilance Department after finding involvement of the District Magistrate-cum-Chief Execution Officer, Arwal, Chairman, Zila Parishad, Arwal, Assistant Engineer, Arwal despite that the Addl. Secretary, Rural Development Department did not take appropriate action in lodging the F.I.R. and investigation by the Vigilance Department.
It has further been submitted that Chairman, Zila Parishad, Rohtas apprised to the District Superintendent of Education, Sasaram about the diversion of fund of NREGA amounting to Rs. 10 crores meant for 300 Schemes and in payment for other purposes, like salary to Gopal Singh retired Zila Parishad, Rohtas. The report of the Examiner of Local Accounts for the year ending on 31.3.2008 Panchayati Raj Institution, Government of Bihar which is marked as Annexure-10, page-77 speaks of 48 Panchayat Samiti but 96 Gram Panchayat did not prepare budget estimate and none of the PRI preparing only accounts for the year upto 2007. Rs. 10.38 crores was detected discrepancy in closing balance of cash book and Bank amounts. In Ujiyarpur and Parihar Panchayat Samiti and Patna and Katihar Zila Parishad engagements of same labourers were shown twice, thrice and four times in the same period.
It is further submitted that diversion of fund was earmarked for SC/ST to the tune of Rs. 80.68 crores. Non-completion of construction of 81 work shop buildings meant for benefit of SC/ST beneficiaries under SGRY grant was found lacks of monitoring and supervision of the work related in wasteful expenditure. Major irregularity in NREGA Schemes at page-214 and fraud execution of NREGA in Panchayat Samiti, Barhara was found at pages-124 and 125. Rs. 87.08 crores under the Scheme of NREGA remains unadjusted at page-125. Rs. 241.54 crores remained outstanding in respect of 2845 Audit Report which is evident from Chapter-Ill: Non-submission of outstanding Table 25 at page-129 annexed to the writ petition.
It has further been submitted that in the conclusion of Principal Accountant General at page-130, it was detected that there was lack of monitoring and supervision over works due to which 3215 works In 12 ZPs, 4163 works in 48 PSs and 2019 works in 194 Gram Panchayats were found incomplete despite payment of advances (cash and grain) of Rs. 25.40 Crores, Rs. 32.55 crores and Rs. 5.78 crores respectively. The annual accounts were not prepared and even the basic accounting report, such as Government Grant Register, Government Loan Register, Advance Register, Deposit Register, Employment and Assets Register etc. were not maintained in absence of which the majority and the assets of Panchayat Raj institutions remained undisclosed at page-130. It has also been pleaded that D.C. Bills amounting to Rs. 43.01 crores out of Rs. 2542.69 crores for the financial year-2002-03 to January 2006 has not been prepared despite repeated reminders vide letter dated 5.2.2007 contained in Annexure-12 at page-181.
He further submits that Annexure-14 La Audit Report (Civil) speaks absence of norms for providing funds and food grains to schools resulted in delay. The Scheme suffered adversely due to inadequate credit mobilization and non-dis-posal of loan applications by Banks, poor-utilization of funds, diversions and mis-utilization of fund etc. There were many discrepancies found in the Audit of finan-cial transactions subjected to test check, in various departments of the Government and their field functionaries revealed instances of irregular payment, misappropriation, loss, excess, idle, avoidable expenditure and misutilization of Rs. 42.92 crores. He has enclosed part of the CAG report as Annexure-16 showing unnecessary supplementary budget of Rs. 1292 crores for the financial year 2007-08.
He has further contended that the Chief Secretary has filed counter affidavit Annexure-T at Page 302, Letter dated 3.3.2010 issued by Sri Vijay Kumar Verma, Principal Secretary, Social Welfare Department to Principal Secretary, Finance Department in regard to submitting DC Bill against the amount withdrawn by AC Bill. The said letter contains submission of Rs. 712,59,23,000.00 at page-302. Advances from the fund shall be made for the purpose of meeting unforeseen expenditure'' including expenditure on a new service not contemplated in the Annual Financial Statement. The Learned Counsel for the petitioners has already drawn attention of the Court about the definition of Rule 4 of Bihar Contingency Fund Rule, 1953 and definition of Contingency Fund defined under Bihar Contingency Fund Act, 1950 created under Article 267 of the Constitution of India. The petitioners have also drawn attention of the Court that Bihar Contingency Fund Rule, 1953 in order to prove Contingency Fund established under Article 267 of the Constitution of India has been fraudulently withdrawn by AC Bills for normal expenditure and not for the purpose of meeting unforeseen expenditure including expenditure on a new service not contemplated in annual financial statement. He further submitted that now it is well settled by various judicial pronouncements, both by the Hon''ble High Court and the Hon''ble Supreme Court about meaning of contingency fund, the mode and method of its withdrawal etc. He has also placed the relevant provisions of the Constitution of India pertaining to the issue in hand i.e. Articles 203, 204, 205, 206, 267 & 283. The Learned Counsel for the petitioners has also quoted Rules 78, 305, 305A, 306, 306A, 342 & 475 of Bihar Finance Rules which fixes responsibility for the preparation of budget estimates. He has also quoted Rules 293, 318, 319, 320, 324, 325, 378, 379 of Bihar Treasury Code.
It is further submitted that CAG Report ending upto 31.3.2008 was placed before the Bihar Legislative Assembly on 14th July, 2009 disclosing outstanding DC Bills amounting to Rs. 11412.54 crores at page-37, utilization certificate amounting to Rs. 4627.20 crores, at page-17 non-reconciled expenditure amounting to Rs. 31614.65 crores. The report of the Examiner of Local Accounts, Panchayati Raj Institution. Govt, of Bihar for the year ending 31.3.2008 also pointed out details of fruitless expenditure due to non-completion of the work, wasteful expenditure amounting to Rs. 26.56 crores in two PS and one Zila Pari shad, 5.4.4 sub-standard of construction of rural road, 5.4.5. Muster roll with the same name, 5.4.6-Diversion of fund earmarked for SC/ST beneficiaries to the tune of Rs. 18.68 crores, 5.4.7-Non-completion of Construction of 81 Work Shops Building meant for the benefit of SC/ST beneficiaries under SGRY Grant, 5.4.8.2. Wasteful expenditure of Rs. 35.36 crores. The Learned Counsel has enclosed Appendix-2.15 statement of unreconciled expenditure amounting to Rs. 26799.13 crores including Rs. 135 crores against the Major Head 214 Administration of Justice amounting to Rs. 3703.36 crores Major Head 2047 other physical services amounting to Rs. 1083.65 crores over Major Head 2515, other Rural Development Programmes amounting to Rs. 5363.51 crores against the Head 2203, General Education amounting to Rs. 1474.31 crores Major Head 4515, Capital outlet, other Rural Development Programmes.
He has also contended that on 2.2.2010 the Hon''ble Patna High Court has directed to the Chief Secretary, Bihar to file counter affidavit stating its stand and stand keeping in view of the allegation made in the petition as well as supplementary affidavit within four weeks. Thereafter the Chief Secretary filed counter affidavit raising objection of maintainability of the PIL and relief prayed for CBI Investigation mainly on the reason CAG Report for the financial year 2007-08 & 2008-09 placed on Table on 14th July, 2009 has. been referred before the Public Accounts Committee and the Hon''ble High Court cannot give direction for CBI investigation as the present writ application is premature.
Learned Counsel for the petition-ers has also placed Section 4 of the Bihar Contingency Fund Act, 1950 read with Rule 6(1) of the Bihar Contingency Fund Rule, 1953 provides that supplementary demand for all the expenditure shall be presented to the State Legislature at the First Session Meeting immediately after the advance is sanctioned and this issue has already been decided at paragraph 16 of the reported case of Sushil Kumar Modi and Others Vs. State of Bihar and Others, which has been affirmed in State of Bihar vs. Ranchi Zila Samta Party, reported in 1996(1) PLJR (SC)97. He has also submitted that the State of Bihar was aware about the fraudulent withdrawal despite that such huge amount of Rs. 11412.56 crores has been withdrawn fraudulently for normal expenditure which is evident from Annexure-T. The amount withdrawn by AC Bill has not been presented to the State Legislature at the First Session. He has also placed reliance on Articles 202, 203, 204, 205 and 206 of the Constitution of India in support of the facts there has been unnecessary supplementary budget and the Legislature has not authorized to withdraw to such amount from the contingency fund against which DC Bill amounting to Rs. 11412.54 crores has not been submitted as per Section 320 of Bihar Treasury Code read with Proforma-39. The Accountant General has also failed to discharge his duty in assistance in preparing budget as described u/s 78 of the Bihar Finance Rule. Rs. 11924.44 crores for the period from 2002-03 to 2007-08 has been illegally withdrawn by AC Bills Incomplete is disregard Ed.-{sic- in complete disregard-) of Sections 305, 305(A), 306, 306(A) 342 and 475 of the Bihar Financial Rule.
It is further contended that at paragraphs 11 and 13 of the order dated 15.7.2010 the Hon''ble Coordinate Bench haS took judicial notice to the amount of Rs. 11412.54 crores meant for the poorest of the poor of the country, the speechless and downtrodden amongst teeming millions of the countrymen, is surely a genuine and bona fide PiL. The present PIL is unprecedented in India and it is difficult to conceive that more than 11 thousand crores have allegedly been siphoned off in a poor State like Bihar. There canhot be a more bona fide and genuine PIL than the present one best on such solid foundations-official reports. A responsible Government could have instead readily agreed to a thorough investigation. The Hon''ble High Court has given finding in paragraph 15 that State Government has placed on the record an excjusive counter affidavit, but convincing materials establishing bona fides of the Government has not been brought to our notice.
Learned Counsel for the petitioners further submitted that in the report of Comptroller and Auditor General ending in the year 2007 signed on 31.12.2007 by the Principal Accountant General, Audit Bihar was also laid down before the Bihar Legislative Assembly showing non-availability of pending DC Bills amounting to Rs. 7,748.64 crores up to 2006-07 after giving specific notes in Chapter-II allocative, priority and appropriation as per Article 205 of the Constitution of India, it is mandatory for the State Government to get the excess over a Grant or Appropriation regularized by the State Legislature. However, the excess expenditure had not been regularized so far (October, 2007). This was a breach of legislature control over appropriations. Details are indicated in Appendix-XIII. Possibility of financial irregularities like fraud, embezzlement, defalcation etc. remaining undetected due to failure and long delay in furnishing explanation of unregularized excess expenditure could not be ruled out. The CAG report for the financial year 2006-07 clearly speaks that outstanding DC Bills amounting to Rs. 7748.69 crores at page 39, utilization certificate amounting to Rs. 4454.54 crores, at page''19 unreconciled expenditure amounting to Rs. 21838.05 crores, at page 36 total Rs. 3440.23 crores. Extract of CAG report of 2006-07 pages 18, 39 to 40 has been brought on record as Annexure-4 of the second supplementary affidavit of IA No. 25547 of 2011.
Learned Counsel for the petitioners has further contending that audit apprehends that the transactions of transportation of foodgrains claimed to have been made under a false truck numbers had actually never taken place and 3115.66 quintals of foodgrains have been transported appears false and embezzled.
It has further been submitted that the Bihar Treasury Code provides that advances drawn on Abstract Contingent (AC) Bills should be settled by submitting Detailed Contingent (DC) Bills to the Accountant General (A&E) not later than 25th of the sixth month from the date of drawal of advance from the Treasury. The fraudulent payments under JSY in 14 PHCs of five Districts have also been found. Rice valuing Rs. 86.53 lacs under the Sampurn Gram in Rojgar Yojana and the National Food for Work Programme for distribution to daily wage earners was misappropriated and rice valuing Rs. 11.51 crores meant for the Sampurn Gramin Rojgar Yojana was not utilized. The Accountant General has also come to the conclusion as follows:-
During 2008-09 expenditure of Rs. 37445.83 crores was incurred against total grants and appropriations for Rs. 48758.97 crores, resulting in net savings of Rs. 11313.14 crores. Excesses over Grants/Appropriations of Rs. 54.63 crores required regularization under Article 207 of the Constitution of India. Departments had not prepared their estimates keeping in view the relevant factors like trends in the economy, actual expenditure of last three years and other factors. Huge and persistent savings, excess over provisions, unnecessary/excessive/inadequate supplementary provisions/reappropriations and non-surrender of anticipated savings indicated inadequate financial management and lack of budgetary control.
Learned Counsel for the petitioners has further submitted that utilization certificates, annual accounts, prof or ma accounts etc. by State institutions and undertakings are the-basic inputs of financial reporting. Qualitative reporting on time is necessary condition for effective and good governance which can help the Government in taking appropriate steps for ensuring accountability and improving efficiency. DC Bills are required to be submitted within six months from the drawal of AC Bills but a total of 50988 DC Bills amounting to Rs. 11854 crores up to March, 2009 were pending up to July, 2010. As regards furnishing of utilization certificates (UCs), 21114 UCs aggregating to Rs. 4527.77 crores were due for submission as of October, 2007. No mechanism was developed to intimate the amounts paid as grants and loans by the Government. Departmental Commercial undertakings of the State were not preparing/furnishing their accounts. Huge amounts under receipt/expenditure heads were being classified under the minor head ''800-Other Expenditure/Receipt1. A number of cases of disappropriation, loss, defalcation, theft etc. remained unsettled for long periods. Autonomous bodies of the Government had not submitted SARs to the Legislature in time. A photocopy of the CAG report for the year ending on 31st March, 2010 is annexed as Annexure-6 of second supplementary affidavit of I.A. No. 2557 of 2011.
Learned Counsel for the petitioners have also submitted that the development which took place after 15.7.2010 on the record in order to assist the Judicial Administration that the Hon''ble High Court, Patna has rightly come to the conclusion for investigation after finding misappropriation/defalcation of Rs. 11412.54 crores and unprecedented/Public Interest Litigation. The development took place after 15.7.2010 have proved the finding of the Hon''ble High Court, Patna about the tampering of the evidence in submission of forged DC Bills in order to reach over the finding of the Hon''ble High Court, Patna to avoid CBI investigation. The State Government has also withdrawn more money through AC Bills not meant for unforeseen expenditure.
It has further been submitted that the order dated 15.7.2010 was not recalled/modified and reviewed on the other hand interlocutory application filed by the State was rejected meaning thereby order passed by the Hon''bfe High Court, Patna attained its finality. The State of Bihar has not preferred appeal before the Hon''ble Apex Court against the order dated 15.7.2010 and 15.4.2011 passed in CWJC No. 1710 of 2010 and its analogous cases so in view of the judgment reported in the case of Satyadhyan Ghosal and Others Vs. Sm. Deorajin Debi and Another, , pragraphs-7, 8 and 16, U.P. State Road Transport Corporation Vs. State of U.P. and Another, paragraphs 11, 12, Premier Tyres Limited Vs. Kerala State Road Transport Corporation, Paragraphs. 4, 5 and 6, Jawahar Lal Sazawal and Others Vs. State of Jammu and Kashmir and Others, , Paragraph 16. The petitioners have cited the said judgment on the principle of res judicata which is applicable also in the writ application. In this view of the matter, State Government cannot reagitate issue of pendency.of CAG report 2007-08 for the Public Accounts Committee after change of Coordinate Bench. So only issue is to be decided as to whether matter be referred to the CBI for investigation or not?
It has further been submitted that the material which was available in supplementary reply to the counter affidavit pages 361 to 651 are better evidence and material than the material evidence on the basis of which direction for CBI was issued on 12th May, 2011 in Writ Petition (C) No. 645 of 2007 reported in Centre for Environment and Food Security Vs. Union of India (UOI) and Others, and as such the Hon''ble High Court, Patna was not restrained by the Hon''ble Apex Court at any time for not issuing order for investigation by CBI. The Hon''ble High Court, Patna is well within. jurisdiction under Article 226 of the Constitution of India to pass direction for CBI investigation. It is relevant to state that power of the Hon''ble High Court, Patna for issuing direction for CBI investigation un-Ed.-Reported in 2010(3) PLJR 646. der Article 226 of the Constitution of India has been considered in the case of State of West Bengal and Others vs. Committee for Protection of Democratic Right, West Bengal and Others reported in State of West Bengal and Others Vs. The Committee for Protection of Democratic Rights, West Bengal and Others, In paragraph 42 of the said judgment it has been relied reported case State of Uttar Pradesh vs. Jeet S. Bisht ( 2007(7) SCC 586). In paragraph 57 of the said judgment it has also taken into note that the right conferred by part 3 of the Constitution, right conferred under Article 226 of the Constitution of India can be exercised not only for the enforcement of fundamental right for any other purpose as well as enforcement of any illegal (s/o-legal) right conferred by statute etc. In paragraph 68 of the said judgment, which is the concluding part of the judgment for issuing order for investigation by CBI after taken into Entry-2 of List-2 of VII Schedule on one hand and Entry 2A and Entry-80 of List-I. In paragraph 69 of the said judgment jurisdiction of the Hon''ble High Court, Patna for issuing order of investigation by CBI has been decided. The Hon''ble High Court, Patna has decided the issue in the case of Sushil Kumar Modi and Others Vs. State of Bihar and Others, in paragraph nos. 20 to 22 on the point of excess withdrawal of money without subsequent adjustment by prescribed procedure as required under Article 205 of the Constitution of India.
Learned Advocate General Mr. R.B. Mahto assisted by learned A.A.G.-I Mr. Lafit Kishore has vehemently refuted the submission made by Learned Counsel for the petitioner-. He has further contended that the writ petition is liable to be dismissed for the following reasons:-(i) The writ petitions are not maintainable; (ii) The writ petitions are not genuine Public Interest Litigation but is inspired by political vendetta and is directed against the present regime; (iii) In view of the facts stated in the Counter Affidavits and Supplementary Counter Affidavits, the Court should not entertain the writ petition, and (iv) even on factual matrix the allegations leveled in the writ applications are absolutely false, incorrect and hence the writ petitions are liable to be dismissed.
It is further contended that the writ applications are absolutely vexatious exercise and the entire foundation of the petitioner''s case are based upon the CAG reports. The said CAG reports have already been led before the State Legislature on 14.7,2009 and the said reports have already been forwarded to the Public Accounts Committee (in short "PAC"). The CAG reports being a legislative paper continues to remains the legislature''s exclusive property till such time that the legislature is seized of the matter. Therefore, any judicial intervention would not be in consonance with the Doctrine of Separation of Powers envisages under the Constitution and would be prejudicially to the immunity and prejudice conferred upon the legislature as per Constitution of India.
It is further contended that the facts on record would indicate that the CD made available by the Accountant General, Bihar indicates that the amount involved in AC Bill for the period 2002-03, 2007-08 was Rs. 9937.43 crores and for the corresponding period DC Bill to the extent of Rs. 93720458 crores have already been submitted. Similarly, for the years 2008-09 and 2009-10 DC Bill to the extent of Rs. 2803.31 has already been submitted leaving the outstanding amount to be only Rs. 3570.08 crores. The aforesaid facts are mentioned in the Supplementary Counter Affidavit filed on behalf of the State Government. Paragraph 10 of the said affidavit clearly indicates the adjustment of DC Bill has been solely due to the voluminous quantity and due to severe shortage of man power in the Accountant General Office. Necessary steps to increase the man power and conse- quently to the sufficiency of the Accountant General Office have already been initiated by the State Government. Additionally, since the process of reconciliation of Account is continuous one as opposed to one time measure of outstanding amount shall stand reconcile expeditiously.
It is further contended by A.A.G.-1 Mr. Lalit Kihsore that Annexure No. 1 of the Supplementary Counter Affidavit filed in CWJC No. 1719 of 2010 mentions that. CAG report for the year 2007-08 has been led before the State Legislature on 14.7.2009 and consequentially referred to PAC after which PAC has held several meetings. Similarly, the CAG report for the year 2008-09 and 2009-10 which tabled before the State Legislature on 23.7.2010 and 27.7.2011 respectively the same have also been interested (sic) referred to PAC who is exercising the reports as per rules.
It is further contended by learned Advocate General Mr. Ram Balak Mahto and learned A.A.G.-I that the present PIL is purely vexatious in nature and suffers from serious mala fides because despite the petitioners attempting that the alleged financial irregularities is span occur three political regimes i.e. RJD (Pre 2005), President Rule (Feb. 2005 to Nov. 2005) and NDA (I and II after 2005). Petitioners have chosen to only implead the political executive member of the given reasons (sic) without demonstrating any rational for the same. The nature of allegations in the present writ petitions create an impression that it has been filed for extraneous consideration proper motive to set personal score with the Chief Minister and Deputy Chief Minister and other functionaries of the State Government. It is further contended that despite their clear distinction between the term Defalcation, Embezzlement and Reconciliation, the petitioners deliberately chosen to depict the instant situation as one of defalcation whereas the Learned Counsel appearing on behalf of the Accountant General, Bihar has himself submitted that the instant cases is one appertaining two issues arising out of reconciliation and not defalcation. The petitioners have filed even on earlier occasion various PIL making.allegations against the present regime and same were filed with to malign and dislodge the present Government which gives an impression that the writ petitioners have some personal agenda at the behest of 3rd person.
It is further submitted that the report of the CAG relating to accounts of the State is required to be submitted to the Governor of the State under Article 151(2) of the Constitution, who shall cause them to be laid before the Legislature of the State. Article 208 of the Constitution enables a House of the Legislature to make rules for regulating, subject to the provisions of the Constitution, its procedure and the conduct of its business. Article 209 of the Constitution provides that the legislature of a State may, for the purpose of the timely completion of financial business, regulate by law the procedure of, and the conduct of business in, the House or Houses of the Legislature of the State in relation to any financial matter or to any bill for the appropriation of money out of consolidated fund of the State.
It has further been submitted by learned Advocate General that the report of CAG, which is sole foundation for the claims made on behalf of the petitioners have already been laid before the Bihar Legislative Assembly and have been referred to the Public Accounts Committee where the same are pending consideration and the Public Accounts Committee have already held a series of meetings with respect to Abstract Contingent Bill and Details Contingent Bill, details were mentioned in Annexure-1 to the supplementary counter affidavit filed on behalf of the State. In such situation, it was submitted that in view of the constitutional mandate and restriction, it would be totally opposed to the scheme of the Constitution itself to permit and kind of discussion even by way of enquiry of any third agency until the report of PAC is submitted to the House and the House has considered in taken in its final decision. Keeping in view, the aforesaid constitutional scheme and the judicial propriety, Addl. Advocate General submitted that this Court should desist from interfering upon the Legislature exclusive reserve, especially at a time when the Legislature is seized of the matter as is the situation in the present case.
Learned Advocate General further submitted that the Court must not intervene in the present case, since the CAG report is the exclusive property of the Legislature and any interference by the judiciary till such time that the Legislature continues to remain ceases, suffers from a clear want of jurisdiction. According to him any observation by the Courts on the basis of CAG report would be tantamount to substituting his own wisdom for that of the Legislature and creating note for parallel investigation.
Concluding his submission, learned Advocate General further contended that when the CAG report is iaid before the House to refer PAC which are under consideration which has exclusive jurisdiction in respect of the same as such the said report becomes a part of the business of the House and as such any proceedings cannot be undertaken before any Court or executive in that behalf.
Learned Advocate General assisted by learned AAG-I further submitted that the entire allegation of misappropriation, defalcation, financial irregularities and other charges have been made in the writ applications on the basis of the entries and observation made in the CAG reports and other connected reports. While referring to the CAG report for the year ended on 31st March, 2008 which is the sole basis of the allegations leveled in the writ application, the CAG has recorded in the overview of its report on the finding of the State Government as under:-
The State experienced and improvement in its fiscal position during 2007-08 in terms of his fiscal parameter (revenue, fiscal, primary deposit, surplus) in relation to their value in 2006-07.
It has been observed in the report that fiscal deficit as declared from 3.05% in the year 2006-07 to 1.62 during current year which was well within the norms and responsibilities of budget management. Similarly with respect to allocate priorities and appropriation CAG has recorded "against the total budget within of Rs 43,004.44 crores expenditure of Rs. 31,614.65 Crores was entered during 2007-08. The overall saving of Rs. 11389.79 crores was net result of saving. A photocopy of the said over view is being annexed as Annexure No. 8 to the counter affidavit filed on behalf of the State. So far as the status of adjustment of Abstract Contingent (AC) bill and submissions of the Detail Contingent (DC) Bill is concerned it was submitted on behalf of the State that from the CD. made available by the Accountant General the amount involved in AC Bills over the periods 2002-03 to 2007-08 was Rs. 9937.43 Crores as against that DC Bills for the aforesaid period for Rs. 9372.7 Crores have already been submitted and only the outstanding DC Bills are for Rs. 564.84 crores similarly for the years 2008-09 and 2009-2010 DC Bills for Rs. 2803.31 Crores have already submitted and outstanding is only 3570.88 Crores. The aforesaid facts and figures have been given in the supplementary counter affidavit filled on behalf of the State referring to Paragraph-10 of the supplementary counter affidavit regarding slow progress of such adjustment it was submitted that there being shortage of manpower in the office of the Accountant General and some defects in some of the DC Bills, complete adjustment have not taken place. The issue was discussed with Accountant General and additional manpower from the State Government have been made available to the office of the Accountant General the respondent referring to the allegation of irregularity with respect to the other scheme place pointed out that various actions taken by the State Government as and when any instance of irregularities came to the notice of the State Government.
Elaborating the aforesaid submissions, it is further submitted that the CAG has not observed that the amount, which the writ petitioners alleged in the petitions have been misappropriated or defalcated no reconciliation of AC and DC Bills cannot said to be defalcation of the State money in that connection pointed out that not only in the State of Bihar but in almost in every State and even in the country the system of AC and DC bill and advance released are in vogue. The non-adjustment of AC, DC Bill does not lead to any conclusion that it is in the category of misappropriation and misutilization of fund rather publishing of AC and DC Bill is a continuous process of reconciliation.
Similarly, with respect to the allegation of the petitioners regarding excess expenditure amounting to Rs. 7026.26 Crores till September 2008 it was submitted that regularization of Rs. 5111.06 crores have already recommended by CAG to PAC which is also mentioned in para 2.3.4 of the CAG report for the year 2009-10. In respect of allegation of unnecessary supplementary budget, it is submitted that budgeting of Government Finance is based on assumption to resources and expenditure. The resources of the State Government are passed on the State share in central share to taxes grants from Central Government as well as State income from its own taxes and non-taxes. It is further submitted that for controlling vagaries of expenditure, computerized treasury management information system from 2008 on defalcations with respect to misappropriation of funds allocated for execution of MANREGA scheme which is being monitored by the Hon''ble Supreme Court in Writ Petition (C) No. 645 of 2007.
Learned Advocate General further pointed out that the allegations with regard to misappropriation in respect to implementation of other Central Government sponsored scheme are also being monitored by the Hon''ble Supreme Court in Civil Writ (C) No. 196 of 2001, People Unions for Save Liberty vs. Union of India and Others. It is further submitted that even after any such irregularity came to the notice of the State Government prompt action has been taken and necessary instructions have been issued in order to streamline function of the various schemes and to prevent in defalcations and misappropriation of the Government money. Thus, no case of an order for CBI enquiry is made out.
The sheet-anchor of the submission of Learned Counsel for the petitioners Mr. Deenu Kumar is the direction issued by Division Bench judgment of this Court reported in Sushil Kumar Modi and Others Vs. State of Bihar and Others, for CBI enquiry against the Government. Thus, it is necessary to notice the fact of the case. "Petitioners case in that case is that the officers of the Animal Husbandry Department-Both at the district and the Secretariat levels-in collusion with the Treasury Officers of the Finance Department at the Secretariat level with the blessings and support of the Government, systematically drew huge sums of money in excess of the grant, i.e. the financial sanction against fake allotment orders, vouchers, etc. According to the petitioners, because of the involvement and bias of the high-ups, fair investigation into-what has come to be known as Animal Husbandry Scam in the State, is not possible.
The State does not deny that there have been excess drawals of money be vond sanctioned grant. It also does not deny that the drawals were fraudulent in nature.
The Division Bench while dealing with the function of the Public Accounts Committee under paragraph 11 of the report, it has stated that "having regard to the nature of the duties conferred upon the Public Accounts Committee it is doubtful as to whether it lay within the domain of the jurisdiction to make enquiry in respect of fraudulent nature of expenditure.
Hon''ble Apex Court in State of Bihar vs. Ranch! Zila Samta Party reported in 1996(1) PLJR (SC) 97, has dismissed the SLP on the basis that the direction was to investigate corruption in public administration, misconduct by the bureaucracy, fabrication of official records and misappropriation of public funds by an independent agency that would command public confidence. Thus, the direction was issued on account of undisputed fraudulent drawal o� Government money.
In the present case, the allegations made in the writ petition based on CAG report even denied by explaining thg CAG report itself and categorical stanf has been taken that the Public Account Committee is seized with the matter.
Constitution has been given by the people to themselves thereby affirm- ing republican character of the polity antf sovereignty of the people. In His Holiness Kesavananda Bharati Sripadagalvaru Vs. State of Kerala, per Hon''ble M.H. Beg, J. drew dist tinction between the "political sovereignty" and "legal sovereignty" and held that legally, the British Parliament transferred trie whole of its legal sovereignty over the people and territories of this country in British India to the Constituent Assembly which spoke in the name of the people of India. He held that it is the Constitution which is "legal sovereign" although the ultimate political sovereignty may and does reside in the "people". In the said judgment, Hon''ble Shelat and Grover, JJ. also held as such. It has further been held in the said judgment that constitutional structure can be illustrated but not catalogued as republican and democratic form of the Government and sovereignty of the Country. Sovereignty lies in the people and the people send their representative to the Parliament. As held in Keshavanand Bharti (supra) the legal sovereignty lies in the Constitution and under the Constitution the Parliament and the State has been given power to make laws in their respective fields carved out in List-I, List-II and List-Ill under Articles 245 and 246 of the Constitution.
Under Articles 245 and 246 of the Constitution, Parliament has power to make laws read with Entry 77 of List-I which is extracted hereinbelow:-
Powers, privileges and immunities of each House of Parlia-ment and of the members and the Committees of each House: enforcement of attendance of persons for giving evidence or producing documents before committees of Parliament or commissions appointed by Parliament.
Likewise the State has also power under Article 246 of the Constitution read with Entry 39 of List-I I, which is extracted hereinbelow:-
Powers, privileges and immunities of the Legislative Assembly and of the members and the committees thereof, and, if there is a Legislative Council, of that Council and of the members and the committees thereof: enforcement of attendance of persons for giving evidence or producing documents before committees of the Legislature of the State.
Under Article 208 of the Constitution of India, House of Legislature of the State is empowered to make rules for regulating its procedure and conduct of its business. In exercise of this power, Bihar State Assembly has made Rules known as Rules of Procedure and Conduct of Business in the Bihar Vidhan Sabha. In order to have financial control over the Government expenditure the Assembly has constituted PAC and all the powers as referred in Entry 39 of List-II have been given to the Public Accounts Committee. The relevant Rules of Procedure and Conduct of Business in the Bihar Vidhan Sabha are reproduced hereunder:-
Rule 233. Presentation of Appropriation Accounts, Finance Accounts and report before the Assembly.-The report of the Comptroller and Auditor General on the Appropriate Accounts and the Finance Accounts of the State shall be laid before the Assembly on such day as the Governor may appoint.
Rule 234. Publication of Appropriation Accounts, Finance Accounts and Report thereon.-When the Appropriation and the Finance Accounts of the State and the report of the Comptroller and Auditor General thereon have been laid before the Assembly, the Secretary shall cause them to be published and a copy thereof shall be made available for the use of each member.
These documents may be made available for sale to the public even before they have been considered by the PAC, but not until they have been laid before the Assembly.
Rule 235. Accounts and reports thereon referred to Public Accounts Committee.-The Appropriation and the Finance Accounts of the State and the Reports of the Comptroller and Auditor General thereon shall, as soon as they are laid before the Assembly, stand referred to the Committee on Public Accounts constituted under Rule 237.
Rule 236. Discussion on the Accounts and Report thereon.-No discussion on the Appropriation and the Report of the Comptroller and Auditor General thereon shall take place in the Assembly until the report of the Committee on Public Accounts on such accounts and reports has been presented to the assembly under Rule 239.
Rule 237. Constitution of Public Accounts Committee.-
(i) There shall be a Committee on Public Accounts for purpose of dealing with the report of the Comptroller and Auditor General relating to the appropriation Accounts and the Finance Accounts of the State and such other matter as the Finance Department of the Government (hereinafter called the Finance Department) may refer to the Committee.
(ii) The Committee on Public Accounts shall consist of not more than thirteen members including the Chairman. They shall be elected by the Assembly according to the principle of proportional representation by means of the single transferable vote. The Chairman shall be appointed by the Speaker from amongst the elected members. In the absence of Chairman from any sitting the member present may select one of their members to act as Chairman of that sitting. Provided that a Minister shall not be elected as member of the Committee and that if a member, after his election to the Committee, is appointed as Minister, he shall cease to be a member of the Committee from the date of such appointment.
(iii) The term of office of members of the Committee shall be one year.
(iv) The Committee may hear officials or take evidence connected with the accounts under examination. It shall be in the discretion of the Committee to treat any evidence tendered before it as secret or confidential.
Rule 238. Duties of Pubiic Accounts Committees. In scrutinizing the Appropriation Accounts and the Finance
Accounts of the State and the report of the Comptroller and Auditor General relating to such accounts it shall, inter alia, be the duty of the Committee to satisfy itself.
(i) That the money voted by the Assembly has been spent within the scope of the demands granted by the Assembly and to bring to the notice of the Assembly every case in which it is not so satisfied,
(ii) That the money shown in the accounts having been disbursed where legally available for and applicable to the service or purpose to which they have been applied or charged,
(iii) That the expenditure conforms to the authority which governs it, and
(iv) That every reappropriation has been made in accordance with the rules made in this behalf by the Governor or by the Finance Department as the case may be.
The Committee shall bring to the notice of the Assembly
(i) Every reappropriation within a grant which has the effect of increasing the expenditure on an item the provision for which has been specifically reduced by a vote of the Assembly;
(ii) In cases where the Assembly has made a specific stipulated that the money voted for a certain purpose shall not be delivered to any other purpose, every case of diversion of such money to any other purposes without a token vote;
(iii) All expenditure which the Finance Department has requested should be brought to the notice of the Assembly.
It shall also be duty of the Committee
(i) To examine such trading manufacturing and profit and loss accounts and balance-sheets as the Governor may have required to be prepared and the Comptroller and Auditor General''s report thereon;
(ii) To consider the report of the Comptroller and Auditor General in cases where the Governor may have required him to conduct an audit of any receipts or to examine the accounts of the stores and stock; and
(iii) To examine the statements of accounts of autonomous and semi autonomous bodies and of Government commercial enterprises, the report and accounts of which are required to be laid before the Legislature together with the report of the Comptroller and Auditor General thereon, if any:
Provided that the Committee shall not exercise its functions in relation to such public undertakings as are allotted to the Committee on public undertakings by these rules or by the Speaker.
If any money has been spent on any service during a financial year in excess of the amount granted by the House for that purpose, the Committee shall examine with reference to the facts of each case of circumstances leading to such an excess and make and make such recommendation as it may deem fit.
Rule 239. Presentation of Reports by Public Accounts Committee.-The report of the Committee on Public Accounts on the Appropriation and the Finance Accounts of the State and the Reports of Comptroller and Auditor General thereon shall be presented to the Assembly by the Chairman of the Committee on Public Accounts. The reports after presentation shall be deemed to be made available for publication and sale.
On this being done, the Chairman of the Committee of Public Accounts shall move the following motions:-
(i) That the Report of the Committee on the Public Accounts on the Appropriation and the Finance Accounts of the State and the Reports of the Comptroller and Auditor General there on be taken into consideration.
Thus, perusal of the aforesaid rules clearly mentions that the Public Accounts Committee has all the powers to come to right and correct the decision and submit its report before the Assembly. In this way, people of State have full control through its representative over the Government expenditure. In the republican system of democratic Government, Council of Ministers are answerable to House under Article 164(2) of the Constitution of India as the Council of Ministers are political executive head of the Government of various departments as distributed by the Chief Minister. House/Assembly during course of discussion on the report of the Public Accounts Committee may take action in case of any defalcation in the voted budget or in the money drawal from the contingency fund. In view of this, the Public Accounts Committee functions tike a Mini House of the Assembly.
In the present case, it has been categorically stated that the Public Accounts Committee is seized up with the matter and the report is yet to be discussed in the House/Assembly. Therefore, enquiry by the C.B.I, is not warranted and the fact of corruption in public administration, misconduct by the bureaucracy, fabrication of official records and misappropriation of public funds, fraudulent drawn have been categorically denied. Therefore, facts of this case is entirely different from the facts of the Sushil Kumar Modi (supra).
Constitution Bench of Hon''ble Supreme Court in the case of State of West Bengal and Others Vs. The Committee for Protection of Democratic Rights, West Bengal and Others, has held that Hon''ble Supreme Court as well as the High Court have powers to direct for CBI enquiry but with certain self-imposed limitations in paragraph nos. 70 & 71 as under:-
Before parting with the case, we deem it necessary to emphasize that despite wide powers conferred by Articles 32 and 226 of the Constitution, while passing any order, the Courts must bear in mind certain self-imposed limitations on the exercise of these constitutional powers. The very plenitude of the power under the said Articles requires great caution in its exercise. In so far as the question of issuing a direction to the CBI to conduct investigation in a case is concerned, although no inflexible guidelines can be laid down to decide whether or not such power should be exercised but time and again it has been reiterated that such an order is not to be passed as a matter of routine or merely because a party has levelled some allegations against the local police. This extraordinary power must be exercised sparingly, cautiously and in exceptional situations where it becomes necessary to provide credibility and instil confidence in investigations or where the incident may have national and international ramifications or where such an order may be necessary for doing complete justice and enforcing the fundamental rights. Otherwise the CBI would be flooded with a large number of cases and with limited resources, may find it difficult to properly investigate even serious cases and in the process lose its credibility and purpose with unsatisfactory investigations.
In Secretary, Secretary, Minor Irrigation and Rural Engineering Services, U.P. and Others Vs. Sahngoo Ram Arya and Another, this Court had said that an order directing an enquiry by the CBI should be passed only when the High Court, after considering the material on record, comes to a conclusion that such material does disclose a prima facie case calling for an investigation by the CBI or any other similar agency. We respectfully concur with these observations.
In the case in hand, fact of cor-ruption in public administration, miscon- duct by the bureaucracy, fabrication of official records and misappropriation of public funds, fraudulent drawal have been categorically denied as noticed above. We are not satisfied that prima facie case is made out to issue a direction for CBI enquiry. However, we expect that the Hon''ble Chairman of Public Accounts Committee may complete the report as early as possible.
Next argument of the Learned Counsel for the petitioners that the order dated 15.7.2010 is an order of Coordinate Bench and is precedent and is binding over the Coordinate Bench. The portion of the order dated 15.7.2010 relied upon by the petitioner is reproduced hereinbelow:-
The next question for consideration is as to the agency to which the investigation has to be entrusted. We feel that the local investigating agencies will not be able to handle investigations of such an enormous magnitude involving the high and the mighty and the most powerful and influential in the administration of this State, with local affiliations, and local pressures. In view of the staggering amount involved in these schemes creating a clear prima facie impression in our minds that huge amounts have been systematically and mercilessly plundered in the State of Bihar during the periods 2002-03 to 2007-08, with provisions and complete absence of Government attention, it must be investigated by the C.B.I., and independent agency created under the Delhi Special Police Establishment Act, 1946 (Act 25 of 1946). It cause for investigation by an independent agency beyond the reach of State Government otherwise it will be a complete failure.
The writ petitions were again listed on 15.4.2011 before the same Bench and the Division Bench passed the order, operative portion of which reads as under:-
As recorded hereinabove, by our order dated 15th July, 2010, we had directed the Director, CBI and the Joint Director, CBI, Patna to remain personally present before the Court on 26th July 2010. We had also made it clear "the observations made hereinabove are meant for disposal of the issue raised before us today, i.e. whether or not the allegations levelled in the writ petitions are fit to be referred for the investigation by C.B.I.
In our opinion, in view of the passage of time, the above referred direction pales into insignificance. The matter requires the order afresh, if necessary.
For the aforesaid reason, the Interlocutory Applications are disposed of.
The writ petitions be notified for admission before the Bench according to the prevalent roster.
Thus from the above quoted orders, it is clear that no direction was issued but the counter affidavit and supplementary counter affidavit by the State Government has been filed in which the facts asserted in the writ petition and supplementary affidavit have been denied. The order stands merged in this judgment and the argument of the Learned Counsel for the petitioner is misconceived and is hereby rejected.
For the reasons recorded above, the writ petition fails and is hereby dismissed. In the end, we record our appreciation to the valuable assistance and the hard work and labour put in by Mr. Dinu Kumar, Learned Counsel for the petitioner, Mr. R.B. Mahto, learned Advocate General assisted by Mr. Lalit Kishore, learned AAG-I.