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Judgment
Anand Byrareddy, J.—Heard rite Counsel for the petitioner and the respondent.
The facts briefly stated are as follows:
The petitioner is aggrieved by the order dated 31.7.2002 which is an order by the State Government referring a matter for investigation by the Lokayukta and the final investigation report submitted by the Lokayukta. It transpires that there were allegations of omission and commission by the petitioner during his tenure as the Additional Director, Health and Family Welfare Department and it is on the basis of such allegation that the State Government had referred the matter to the Lokayukta for investigation u/s 7(2A) of the Karnataka Lokayukta Act, 1984 (hereinafter referred to as ''the Act'' for brevity). The Lokayukta in turn having initially investigated the affairs of the department in which the petitioner was acting as the Additional Director through its Technical Wing had thereafter, submitted an Investigation Report and a Final Investigation Report holding that the petitioner along with ethers was responsible for causing loss to the State Government to the extent of Rs. 70,85,000/-.
The Counsel for the petitioner would submit that in terms of Section 7(2A) of the Act, though the Sub-section provides that the State Government may refer the matter for investigation in respect of any act of a public servant, the reference is not mechanical Unless there is subjective satisfaction of the State Government, the reference cannot be made sad this is supported by a decision of this Court in Dr. K. Chowdappa v. State of Karnataka reported in ILR 1990 Kar 790. The Counsel for the petitioner would point out that a vague letter addressed to the Chief Minister by the Vice-President of the Karnataka Pradesh Youth Congress Committee as to the involvement of the petitioner in a so-called transaction involving Rs. 30 crores, could not have prompted the State Government to issue the order at Annexure-E placing the matter before the Lokayukta for investigation. Such a measure was wholly unwarranted and the State Government ought to have arrived at a subjective satisfaction, on the basis of material facts and circumstances in referring the matter to the Lokayukta for investigation. As the action involves civil and criminal consequence insofar as the petitioner is concerned, this was an essential requirement of the State Government to have arrived at subjective satisfaction as to the involvement of the petitioner and the veracity of the allegation before initiating the extreme action of investigation by the Lokayukta, into the alleged acts of misfeasance and misconduct if any.
The Counsel would further submit that according to Section 8 of the Act, which provides for matters which cannot be the subject matter of investigation by the Lokayukta. In terms of Clause (a) that any action which relates to any matter specified in the Second Schedule cannot be investigated. From n reading, of the Second Schedule, the Counsel would seek to demonstrate that under Clause (c) of the Second Schedule, any matter which arises out of the terms of a contract governing purely commercial relations of the administration with customers or suppliers. As the present case on hand involved the supply of I.V. fluids by the manufacturer which is a State Government organization and the petitioner acting as the Additional Director of the Procuring Authority would squarely involve a transaction which relates to supply of goods and therefore, would fall under Second Schedule and hence, the Lokayukta did not have the power of investigation of the matter and hence, would submit that the Lokayukta will not have the jurisdiction to have enquired into and to have submitted the report.
On merits, the Counsel would seek to take this Court through the record to demonstrate that the petitioner did not in fact have any choice but to act in the manner he has. With particular reference, he has pointed out that there was acute shortage of I.V. fluids and the Government had taken a decision to procure IV fluids immediately and as per the Transparency Act since there is a provision to take the services of M/s. KAPL, the department had taken a decision to obtain I.V fluids from the said entity to tide over the emergency and it was an adhoc arrangement. The cost factor was wholly secondary as the I.V. fluids are life saving drugs. Apart from this, it is pointed out that the rate contract under which the supplies were procured expiree on 30.9.2000. If the required amount of drugs were not procured, the remaining budget for the year 2000-01 would have lapsed, at the end of March 2001. The petitioner having been informed by the Principal Secretary to the Government that the rate contract would not be extended beyond 31.3.2001, as the same was under challenge before this Court and was instructed to assess the requirement for the year 2001-2002 and place the orders for procurement of drugs before 31.3.2001 and inspite of circular instructions issued, majority of the District Health Officers and the District Surgeons not having sent their indents and if timely action was not taken the budget for the year 2001-2002 would have lapsed, It was done with good intention to see that the drugs were made available to 11,450 institutions covering the entire State, till the new rate contract was finalized and in the absence of proper indents from the Districts, assessments were made on practical, basis, taken into account the indenting trends from the peripheral institutions and since getting the indents from peripheral institutions was a cumbersome process, it was recommended for assessment of requirements by the Government Medical Stores. It was also recommended to keep drugs worth Rs. 5 crore as buffer stock. The Government Medical Stores issued the drugs based on the indents and no drugs purchased during his tenure have been King with the Government Medical Stores or shown to have expired. Therefore, it is in this vein that the petitioner would seek to justify his actions and demonstrate that there was no omission or commission on Ms. part which entailed an enquiry or investigation by, the Lokayukta and hence, would seek an appropriate writ to set at naught the orders impugned.
On the otter hand the Counsel appearing for the Lokayukta would submit that Section 7(2A) does not require the sanction of the State Government in the Lokayukta to investigate The Section contemplated refers of a matter for investigation. The matter having been referred to the Lokayukta, the same has been investigated. It is also fallacious to contend that the transaction is a commercial transaction and is for supply of goods which could not have been enquired into, in terms of Clause (c) to the Second Schedule, On the other hand, as pointed out from the record, the investigation pertained to the acts of omission and commission spread over a period of time relating to procurements generally and the need or requirement of such material and the petitioners role in the same. This cannot be termed a an enquiry into a commercial transaction for supplies, Therefore, the Lokayukta having investigated and submitted its report is in accordance with law. There is no basis for the present writ petition and there is no ground made out for the interference of this Court in the proceedings He would also submit that pursuant to the report of the Lokayukta, the State Government having passed necessary orders directing the Lokayukta to hold a disciplinary enquiry and the disciplinary enquiry having been initiated, the present petitioner has approached this Court and has obtained an order of interim stay of those proceedings and therefore, would submit that the writ petition be dismissed.
The Government Advocate on her part would submit that if the petitioner contends that he has a valid defence in respect of his acts, it is open for the petitioner to raise these contentions at the departmental enquiry and hence, the Lokayukta having investigated and submitted its report, the proceedings are required to be taken to their logical conclusion bind since there is no illegality in the proceedings are as pointed out by the Counsel for Lokayukta the reference; and the reports being in accordance with law, there is no warrant for interference in further proceedings and would submit that the petition be dismissed.
Given these facts and circumstances, the first question whether there is subjective satisfaction in the State Government haying referred the matter to the Lokayukta is concerned, the allegation having come from the Vice President of a Committee of a political party, the Chief Minister having referred the matter to the Lokayukta would indicate that there was an element of subjective satisfaction The reference to the decision in Dr. K. Chowdappa v. State of Karnataka reported in ILR 1990 Kar 798 which was a case where a complaint was filed before the Chief Minister of a State. The office of the Chief Minister after examining the said complaint and after approval of the Chief Minister had referred the complaint to the Upa Lokayukta for investigation and it was therefore a case which fell u/s 7(2A). This Court held that the State Government cannot act as a post box. It has also to be remembered that the Legislature itself has reposed confidence in the State Government by providing Section 7(2A). Unless it is specifically proved that the State Government has acted mala fide in exercise of its power u/s 7(2A) of the Act or the case does not felt under the Act or it does not relate to any action taken by or with the general or specific approval of a public servant, no complaint about the tenabiliry of a reference made u/s 7(2A) of the Act by the State Government can be entertained. Therefore, the judgement, would not support the case of the petitioner. Cm the other hand, would fortify the reference made by the State Government, since m the instant case on hand, it is made by a Vice-President of a Committee of a political party and the Chief Minister having recommended the reference to the Lokayukta, it cannot be said that there was no subjective satisfaction. Even if it could be held that Section 7(2A) required the subjective satisfaction of the State Government though there is no reference to any such requirement under the Section itself, further, insofar as the contention that the action complained of was in respect of a commercial transaction involving supplies and therefore, was a matter falling under (c) of the Second Schedule and hence cannot be investigated by the Lokayukta is concerned, it is pointed out by the Counsel for Lokayukta, the transaction involved was of a complex nature spread over a period and pertained to not one transaction but several and was not really in respect of supply of goods, it was more of procurement or an act of procurement which has caused loss to the State Government. In airy event, the report of the Lokayukta being of a preliminary nature, the petitioner who is yet to be heard as regards his defence, there is ample opportunity at the enquiry that has been initiated Therefore, there is no infirmity in the present proceedings initiated by the State Government and the report submitted by the Lokayukta Hence, the contentions of the petitioner that the proceedings be set at naught cannot be accepted. The proceedings would have to be taken to their logical conclusion. The preliminary findings of the Lokayukta shall not prejudice the case of the petitioner at the disciplinary enquiry which shall not be entirely on the basis of the investigation reports of the Lokayukta but would rest on independent findings and on material that is placed at the disciplinary enquiry with ample opportunity to the petitioner to defend himself and to meet the several allegations. Accordingly, the writ petition stands dismissed. The order of stay granted earlier stands vacated.