Ms. Saira Shaikh vs The State Of Goa

Registry to waive office objections in Criminal Revision Application No. 120/2024(F), Criminal Revision Application No. 296/2024 and Criminal Revision Application No. 207/2024(F) and register the matters.

These Criminal Revision Applications No. 08/2024 (filed by Accused No.1-Mohan Kapse), 208/2026 (filed by Accused No.2 Charudatta Ozarkar) 207/2026 (filed by Accused No.4-Saira Shaikh) and 209/2026 (filed by the State) challenge order dated 10.11.2023 passed by the Special Judge, South Goa at Margao, in Special Case (SPCC) No. 2 of 2022, arising from FIR No. RC 2(A)/2020-CBI/ACB/GOA registered on 07.01.2020 by the CBI under Section 120-B r/w Sections 420, 468 and 471 IPC and from Chargesheet which came to be filed on 27.12.2021 under Section 120-B r/w Section 420, 468 and 471 IPC and Sections 7, and 13(2) r/w 13(1)(d) of the Prevention of Corruption Act, 1988. By the impugned order, the Sessions Court has discharged Accused No.1, 2 and 4 of the offences under sections Section 420, 468 and 471 r/w 120-B IPC but directed charge to be framed under Section 7, and 13(2) r/w 13(1)(d) of the Prevention of Corruption Act, 1988 (the PC Act); the impugned order has discharged Accused No.3 in toto.

An FIR was registered on 07.01.2020 by the Central Bureau of Investigation (Goa) alleging that between 2017 and 2019, Mohan Kapse (Accused No.1), then Assistant Commissioner of Customs, Goa, entered into a criminal conspiracy with Charudatta Ozarkar (Accused No.2), a private person, to defraud the Customs Department. Accused No.1 is alleged to have dishonestly issued 114 work orders for furniture, electrical and renovation work at the Customs House, Goa out of which 80 of them were issued without following tender procedure, to four fictitious firms (M/s Apna Bazar, M/s Stylo, M/s Manoj Enterprises and M/s Mahalaxmi Trading Co.), floated by Accused No.2. Accused No.3 (Ms. Nagma Shaikh) and Accused No.4 (Ms. Saira Shaikh) , who were employees of Accused No.2, allegedly created forged supporting documents (quotations, rent agreements, etc.) to open bank accounts and obtain the work orders.

A chargesheet was filed on 29.12.2021 for offences under Section 120-B read with Sections 420, 468 and 471 IPC, and Section 13(2) read with Section 13(1)(d), and Section 7, of the PC Act (as amended in 2018) against all four accused.

The Special Judge took cognizance on 29.04.2022 of the offences under the PC Act, in the absence of any sanction under Section 19 of the Act and issued summons to the four Accused. Sanction under Section 19 of the Act was granted by Government of India-Ministry of Finance, Department of Revenue Central Board of Indirect taxes and Customs by the Office of the Chief Vigilance Officer, on 05.05.2022 and produced before the trial court on 01.06.2022.

The Accused No.1, 3 and 4 on 07.10.2022 filed Applications for discharge under section 239 CrPC at Exhibit-44, 42 and 43 respectively; the State vide replies dated 16.11.2022 opposed the said applications to which the Accused No.1 filed his rejoinder on 19.07.2023, the Accused No.3 and 4 filed joint synopsis ; the Accused No.2 filed application for discharge on 03.02.2023 to which the State filed its reply on 01.03.2023 and synopsis on 28.04.2023 to which the Accused No.2 filed rejoinder dated 09.08.2023.

By the impugned order dated 10.11.2023, the Special Judge discharged Accused No.1, Accused No.2 and Accused No.4 of the offences under Sections 420, 468, 471 r/w Section 120-B IPC but directed that charge be framed against them under Section 13(2) r/w Section 13(1)(d) and Section 7 of the PC Act; the Trial Court discharged Accused No.3 in toto, of all offences under both the PC Act and the IPC. This order framing charge under Prevention of Corruption Act is assailed by the Accused No.1,2 and 4, whereas the State has assailed the said order directing the discharge of Accused No.1,2 and 4 for offences under IPC and for discharging Accused No.3 of all offences.

Advocate for the Applicant/Accused No.4 (Saira), Mr.Vilas Thali in Criminal Revision Application No. 207/2026 has advanced the following submissions:

Advocate for the Applicant/Accused No.1, Mr. H.G Dharmadikari in Criminal Revision Application No. 8/2024 has advanced the following submissions:

Advocate for the Applicant/Accused No.2 (Charudatta Ozarkar), Mr. Vaibhav Ugle in Criminal Revision Application No.208/2026 has adopted the arguments advanced on behalf of Accused Nos. 1 and 4. Though served, Accused No.3 has chosen not to appear in the Criminal Revision Application filed by the State.

Special Public Prosecutor Adv. Ms. Asha Desai Appearing for the State in Criminal Revision Application No.207 of 2024 and for Respondent No.1 in Criminal Revision Applications No. 08/2024, 208/2026 and 207/2026 has advanced the following submissions:

Before considering submissions at the Bar, note would have to be taken of certain relevant facts, which are not in dispute. Accused No. 1 is admittedly a Public Servant (Assistant Commissioner of Customs, Goa) employed with the Central Government between the period of 2017 to 2019, when the offence is alleged to have taken place. He has been discharged by the Trial Court of offences under IPC, but charged for the offences under PC Act. Accused Nos.2 to 4 are admittedly not Public Servants. They have been roped in as conspirator with Accused No. 1 applying Section 120B IPC. They have been discharged of offences under IPC and charged under offences under PC Act. Accused No. 3 has been discharged of offences, both under IPC and PC Act.

The offence by Accused No.1 under the PC Act and IPC is alleged to have taken place between the years 2017 to 2019; according to the Chargesheet, it is alleged that whilst Accused No. 1 was posted in Goa and functioning as the Senior most Member of the Purchase Committee at Customs, Goa, he has conspired with Accused No.2 from whom he obtained fake quotations from non-existent firms of the Accused No. 2 at exorbitant rates for purchase of office furniture, electronics and electrical items; that based on this fake quotations Work Orders were issued to Accused No. 2 on these fictitious firms and payments were made to them. Accused Nos. 3 and 4 were respectively employees of the Accused No. 2 during this period.

The Chargesheet came to be filed on these allegations on 29.12.2021, admittedly without obtaining sanction under Section 19 of the PC Act, nor under Section 197 of the Cr.P.C. to prosecute Accused No. 1. The Trial Court, in the absence of sanction took cognizance of the offence and passed an order doing so on 29.04.2022, and the Accused were summoned to appear before it. Sanction was accorded for prosecution of Accused No.1 on 05.05.2022, restricted to Section 19 of the PC Act. The sanction order does not grant sanction for prosecution of offences under Sections 420, 468, 471 read with Section 120B IPC. the sanction order was produced before the Trial Court only on 01.06.2022. It is only thereafter that the four Accused moved applications for their discharge, on which the present impugned order was passed.

In these background facts, the following point for determination requires to be considered:

For the purpose of answering the point for determination, it would be apposite to refer to some of the decisions of the Hon’ble Supreme Court on the subject. In B. L. Verma (supra), the Supreme Court was dealing with the challenge by the CBI to the order of the High Court holding that lack of sanction to prosecute a person under Section 197 Cr. P.C., would not empower the designated Court to take cognizance of the offences under the IPC, against a Public Servant. Whilst upholding the view of the High Court and confirming this position of law, the Supreme Court also considered, what would be the effect if sanction under Section 197 Cr. P.C. was granted after discharge. The relevant parts of the Judgment are quoted below:

The Supreme Court has therefore opined that cognizance could not have been taken of the offence against the Public Servant in the absence of the sanction accorded under Section 197 Cr. P.C., but however observed that should such sanction be granted by the competent authority, it would be perfectly valid and open to the CBI to activate the prosecution against the Accused and the earlier order of discharge or refusal to take cognizance would not come in the way of grant of sanction or of the Court to take cognizance after such grant.

In Babu Thomas (supra), a Chargesheet was filed under the PC Act and for offences under IPC. A sanction order under Section 19 had been filed along with the Chargesheet. The sanction order was issued by the Company Secretary of the Goa Shipyard, a Central Government undertaking, but subsequently a fresh sanction order was filed after cognizance was taken by the correct competent authority. In these facts, the Supreme Court has made the following observation:

Thus, in Babu Thomas (supra), what has been held is that cognizance taken by Special Court on the basis of a sanction which was not competently issued, invalidates the cognizance of the offence and is cognizance taken without jurisdiction. As a consequence of upholding the invalidity of the order taking cognizance, the Supreme Court permitted the competent authority to issue a fresh sanction order and to proceed afresh against the Accused.

In Nanjappa (supra), the Supreme Court was considering a case where the High Court had reversed an order of acquittal passed by the Trial Court and convicted the Appellant for offences under the PC Act. Before the High Court, it was held that since the validity of the sanction order was not questioned prior to conclusion of the trial, the Accused was precluded from raising this issue at the Appellate stage. The Supreme Court allowed the Appeal on the short ground that in the absence of a valid previous sanction required under Section 19 of the PC Act, the Trial Court was not competent to take cognizance of the offence against the Accused. Note must be taken of the fact that in Najappa (supra), a sanction under Section 19 of the PC Act was in fact produced, but the arguments advanced for the Accused was that mere production of the sanction would not preclude the Special Judge at any stage of the proceedings to hold that the prosecution was not maintainable for want of a valid order. In that case, the Trial Court had held the sanction produced, to be invalid since it was issued by authority incompetent to grant the sanction. In the background of these facts, the following observations of the Supreme Court would be of relevance:

What can be observed from Nanjappa (supra), was that the decision was passed not under circumstances that cognizance was taken in the absence of an order of sanction under Section 19, but whether, the Trial Court could invalidate the sanction order, which was produced along with the Chargesheet at the end of the trial.

Nanjappa (supra) was considered by the Supreme Court in Shivendranath Verma (supra), where the Supreme Court upheld the orders of the Trial Court refusing to take cognizance of the offence under the PC Act in the absence of sanction by the competent authority. Whilst upholding this contention, the Supreme Court considered the order of sanction obtained after the order of cognizance was passed and held that the ratio in Nanjappa (supra) would not extend and operate as invalidating the sanction granted after the order taking cognizance was passed.

In Prakash Singh Badal (supra) the Supreme Court has examined the validity of proceedings initiated under the PC Act and IPC in the absence of lack of sanction under Section 197 of the Cr. P.C., in that context, it has observed that the offence of cheating under Section 420 or those under Section 467, 468, 471 and 120 B of the IPC can by most sketch of imagination, by their very nature be regarded as having being committed by public servant, by acting or purporting to act in discharge of official functions. This Judgment has however been clarified by the Hon’ble Supreme Court in a later Judgment of A. Srinivasalu (supra), and the context in which the Hon’ble Supreme Court made such observations in Prakash Sing Badal (supra). Referring to the observations in para 50 of Prakash Singh Badal (supra), the Supreme Court held as under:

Applying the ratio of the Judgments referred to above, to the facts of the present case, grant of sanction under Section 19 of the PC Act would be a prerequisite for taking cognizance of the offences under the PC Act against Accused No. 1, who was a Government Servant. Accused Nos. 2 to 4 have been roped in by applying Section 120-B, and have sought to be charged as conspirator for offences under the PC Act along with the Accused No. 1. Clearly from the record, as on the date that the Trial Court took cognizance of the offences (29.04.2022) under Sections 7, 13(2) and 13(1) (D) of the PC Act, there was no order of sanction in place. The order of sanction under Section 19 was filed on 01.06.2022. The order dated 29.04.2022, taking cognizance of the offences under the PC Act and IPC against Accused No. 1 was clearly without jurisdiction and is therefore liable to be quashed and set aside. Consequently, therefore the impugned order dated 10.11.2023 directing charge to be framed against Accused No. 1 for offences under the PC Act is without jurisdiction and must be set aside.

In addition, the record reveals that the sanction order dated 05.05.2022 permits prosecution of the Accused No.1 for offences which are restricted to the PC Act, and no sanction is granted under Section 197 Cr. P.C. to prosecute this Accused for offences under the IPC. The Bar to take cognizance of an offence against the Accused No. 1, Government Employee in the absence of sanction under Section 197 Cr. P.C. would therefore apply, and consequently, the order dated 29.04.2022 taking cognizance of the offence under IPC against this Accused would be without jurisdiction. In these facts therefore, the arguments for the State that a sanction under 19 of the PC Act granted to prosecute Accused No. 1 for offences under that Act must be considered to be deemed sanction for the purpose of Section 197 Cr. P.C., to prosecute that Accused for the offences under IPC must be rejected.

Having held that the order taking cognizance of offences under the PC Act or under the IPC passed against Accused No. 1 was without jurisdiction, there is no other option but to hold that taking cognizance of the same offence against Accused Nos. 2 to 4, who are alleged to be part of the very same conspiracy with the Accused No.1, was without jurisdiction. Accused Nos. 2 to 4, could certainly not be charged with an offence under the PC Act in the absence of a charge being framed against Accused No. 1; this would be much less so in the case of taking cognizance of such offences, both under PC Act and IPC, allegedly committed by Accused Nos. 2 to 4, the cognizance would have not been taken against Accused No. 1 himself. Having gone through the allegations in the Chargesheet, it is quite clear that the conspiracy as alleged therein demonstrates that the facts constituting the alleged offence against Accused Nos. 2 to 4, are so related to the offence alleged against Accused No. 1, that if Accused No. 1 could not be charged, the charge must fail against Accused Nos. 2 to 4. Consequently, therefore the order of taking cognizance of offences, both under PC Act and under IPC would necessarily have to be quashed and consequently any order to frame charge against them cannot be sustained.

On the findings given by me above, I answer the first point for determination in the affirmative. Since the orders taking cognizance of the offences, both under PC Act and under IPC against Accused Nos. 1 to 4 are without jurisdiction, these Accused stand discharged.

This brings me to the second point for determination framed above. After considering the decision of the Supreme Court in Najappa (supra), and upholding the order of the High Court quashing the order of taking cognizance, in Shivendranath Verma (supra), the Supreme Court left it open to the prosecution, who had obtained sanction subsequent to filing of the Chargesheet, to press for examining the Chargesheet along with such subsequent order of sanction, and permitted the Trial Court to examine if a fresh order of cognizance could be passed. It has been urged by the State, that this Court, in the circumstances of this case, and in the light of the fact that the order of sanction had been filed before the Trial Court subsequent to the cognizance being taken, should take a similar course, and permit the Trial Court to examine the Chargesheet afresh for deciding whether the cognizance should be taken in the light of the subsequent sanction. After considering this submission and the specific facts of this case, as stated in the material produced with the Chargesheet, I am of the opinion, that no such purpose would be served of leaving the case open for the Trial Court to reconsider whether cognizance should be taken after considering the order of sanction.

On examining the material produced with the Chargesheet, the following facts become evident. The Accused No. 1 Mohan Kapse was the Assistant Commissioner of Customs and part of the Purchase Committee between 15.06.2017 and 08.11.2019, when he is alleged to have influenced the decisions of the Committee to award contracts to Accused No. 2 on the basis of fake quotations at exorbitant rates. The Chargesheet also alleges that Accused No. 2 had given fake quotations in the name of several of his non existing firms. It is also alleged in the Chargesheet that the Accused No.1 would pressurize the other two members of the Committee, who were his subordinates to sign the quotations and based on such decisions, the contracts could be awarded to fictitious firms of the Accused No. 2.

From the materials produced with the Chargesheet, the other members of the Committee between July, 2017 and December, 2019 were the following persons:

The Chargesheet however nowhere referred to any of the statements of the other Committee members, recorded during investigation, that alleged coercion, or pressure being exerted by the Accused No. 1 on them to allot contracts to the firms of the Accused No. 2. Even then, what follows by logic is that all the other committee members ought to have been roped in as Accused, as part of the decision making process, which the State alleges was to defraud the exchequer. This is even more so, since all these committee members were Government Employees in the level of Superintendents in the Customs department.

According to the Chargesheet, the process of effecting purchases for the Department, according to Delegation of Financial Powers, originates with Commissioner of Customs, Goa, who is designated as Head of Department and has full financial powers to accord expenditure. According to the procedure for procurement, the proposal originates from the Commissioner of Customs, after which the Purchase Committee comprising of Accused No. 1 and any two of the Superintendents who are listed in a table at the aforementioned paragraph are required to obtain quotations after completing a market survey, which quotations are required to be maintained under sealed cover and opened at the meeting of the Purchase Committee. The final decision as to whether the purchase is to be effected, is taken ultimately by the Commissioner, on the recommendation of the Purchase Committee of the best quotation.

Considering the procedure to be followed, and if the imputations in the Chargesheet are to be taken at their face value, the Commissioner of Customs, Goa and all other members of the Purchase Committee would be as responsible in the decision making process, which the Chargesheet alleges, was influenced by Accused No. 1 for gains, which was dishonest. What is glaring is that the prosecution has chosen to leave out the Commissioner of Customs and all members of the Purchase Committee from being charged as Accused and has singled out the Accused No. 1. From the material annexed to the Chargesheet, it is difficult to understand how the Accused No. 1 was a privy to the conspiracy with Accused Nos. 2, 3 and 4, in the absence of the final decision maker i.e. the Commissioner of Customs and the other members of the Purchase Committee. This becomes even more evident from the fact that the Commissioner of Customs was never examined and there is no statement in the Chargesheet referring to the Commissioner’s statement.

Accused Nos. 3 and 4 are admitted employees of Accused No. 2. There is absolutely no imputation of any participation of Accused No. 3 in the alleged conspiracy, though there are reference made to the fact that Accused No. 3 was the sister of the Accused No. 4 and was working as a Sales Executive in the shop of Accused No. 2. There is no material on record to demonstrate how Accused No. 3 participated in the conspiracy. As far as Accused No. 4 is concerned, it was alleged that she in order to help Accused No. 2, with whom she was employed, opened an account on her name under the style of “Creative Enterprises” to facilitate Accused No. 2 to submit quotations on the name of this concern and ultimately to receive payments on the basis of the lowest quote picked by the Purchase Committee. However, even going by this fact, the material on the Chargesheet, does not prima facie establish, how there was conspiracy amongst Accused Nos. 1, 2 and 4, in the absence of roping in the other members of the Purchase Committee and the Commissioner of Customs to put the final decision as Accused. From the material in the Chargesheet, none of the offences specified in Sections 7 and 13 of the PC Act can be said to have been prima facie made out, for the purpose of formulating a charge under those Sections. No purpose would be served, under these circumstances in continuing the prosecution of this Chargesheet in the light of the observations made herein, as the case is bound to fail. It is in these circumstances, I am of the opinion that following the course taken by the Hon’ble Supreme Court in Shivendranath Verma (supra) by quashing and setting aside the order of taking cognizance and directing framing of charge against Accused Nos. 1, 2 and 4 under the PC Act, serves absolutely no purpose, as the Trial Court, even if it considers the post facto sanction granted, on the basis of the material in the Chargesheet ought not to take cognizance of the offences under the PC Act against these Accused.

For all the aforementioned reasons, the Criminal Revision Applications Nos. 08/2024 of Accused No. 1, Criminal Revision Application No. 208/2026 of Accused No. 2, Criminal Revision Application No. 207/2026 of Accused No. 4 are allowed and the order taking cognizance of the offences under Sections 7, and 13(2) r/w 13(1)(d) of the Prevention of Corruption Act, 1988 and Sections 120-B r/w Section 420, 468 and 471 IPC stand quashed and set aside, consequently, they stand discharged. For reasons stated above, the Criminal Revision Application filed by the State bearing Criminal Revision Application No. 209/2026 stands dismissed. The discharge of Accused No. 3 is confirmed.

Criminal Revision Application No. 207/2026, Criminal Revision Application No. 208/2026, Criminal Revision Applications Nos. 08/2024 and Criminal Revision Application No. 209/2026 stand disposed of.