karnataka hc judgment exonerating bsy

8/13/2019 Karnataka HC Judgment exonerating BSY

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Dr. KBJ & KGRJ

07.03.2012

JUDGMENT

IN

WRIT PETITION NO.44071/2011 (GM-KLA)



1

IN THE HIGH COURT OF KARNATAKA AT BANGALORE

DATED THIS THE 7 TH DAY OF MARCH 2012

PRESENT

THE HON’BLE DR. JUSTICE K. BHAKTHAVATSALA

AND

THE HON’BLE MR. JUSTICE K GOVINDARAJULU

WRIT PETITION NO.44071/2011 (GM-KLA)

BETWEEN

Sri B S Yeddyurappa,S/o Siddalingappa,Age: 67 years,Residing at No.1Race-Course Road,Bangalore-560 001. Petitioner

(By Sri Ashok Haranahalli, Sr. Counsel, for

Ashok Haranahalli Associates, for petitioner)

AND

The Lokayukta of Karnataka,

Having its Office atM S Building,Dr. Ambedkar Veedhi,Bangalore-560 001.By its Registrar.

The State of Karnataka,Represented by its Chief Secretary,Vidhana Soudha,Dr. Ambedkar Veedhi,

Bangalore-560 001.



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The Superintendent of Police,Karnataka Lokayukta,M S Building,

Dr. Ambedkar Veedhi,Bangalore-560 001.

The Principal Secretary,Governor of Karnataka,Raj Bhavan,Bangalore-560 001. Respondents

(By Sri B A Belliappa, Adv., for R-1 and 3)(By Smt. Revathy Adinath Narde, HCGP, for R-2)(By Sri Nagananda, Sr. Counsel, for

M/s. Just Law, for R-4)

- -- -

This Writ Petition is filed under Articles 226 & 227 of the

Constitution of India, praying to quash the complaint filed by R-3

dated 22.8.2011 against the petitioner herein under Sections 7,8,9

and 13(1)(d) r/w Section 13(2) of the Prevention of Corruption Act,

1988 vide Annexure-A, etc.

This Petition coming on for Orders, the same having been

heard and reserved for pronouncement of Orders, Dr.

Bhakthavatsala, J., made the following:



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ORDER

The petitioner, who was the former Chief Minister (BJP) of

the State of Karnataka, is before this Court under Articles 226 &

227 of the Constitution of India, praying for the following reliefs:

(i) to issue a writ of certiorari and quash the Complaint

dated 22.8.2011 filed by the 3rd

respondent/Superintendent of Police, Karnataka

Lokayukta, Bangalore, against him for the offences

under Sections 7,8,9 and 13(1)(d) r/w Section 13(2) of

Prevention of Corruption Act, 1988, at Annexure-A;

(ii)

to issue a writ of certiorari and quash the FIR

registered in Crime No.36/2011 against the petitioner

for the offences under Sections 7,8,9 and 13(1)(d) r/w

Section 13(2) of the Prevention of Corruption Act, 1988

at Annexure-A-1;

(iii) to quash the Order of Sanction dated 2.8.2011 for

initiating criminal proceedings against the petitioner at

Annexure-B on the file of Governor of Karnataka;



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(iv) to quash the relevant portion of the Report at Chapter

22 of Lokayukta dated 27.7.2011 at Annexure-C and

(v) to grant such other relief or reliefs as this Court may

deem fit in the circumstances of the case.

2. It is pleaded that Commerce and Industries Department in

Government of Karnataka, by its Notification bearing No.CI-164

MMM2006 dated 22.7.2006 (Annexure-D) in exercise of the

powers conferred under section 3 of the Commission of Inquiry

Act,1952, appointed Mr. Justice U L Bhat (former CJ of Gauhati

and Madhyapradesh High courts) to be the Commission to inquire

into the allegations relating to illegal mining in the State of

Karnataka, commencing from 1.1.2000 till date and submit an

interim report within two months and final report within six

months to the Government. As per Notification bearing No.CI 164

MMM 2006 Dated 26.10.2006, the Commission was granted four

more months time to submit interim report. Though 7 ½ months

period had elapsed from the date of appointment of the

Commission, it did not make any progress in the inquiry on the

ground that the Commission was boycotted by the opposition



5

parties and the persons who have complained about the

irregularities and illegalities. Thus, the Commission being unable

to function efficiently, Mr. Justice U L Bhat himself intimated the

Government that he would cease to attend the work with effect

from 8.3.2007. Accordingly, by notification bearing No.CI 164

MMM 2006 dated 12.3.2007 (Annexure-E), declared that the

Commission shall cease to exist with immediate effect. Thus the

‘ Justice U L Bhat Commission’ came to an end. In pursuance of

letter dated 29.2.2005 from the Principal Chief Conservator of

Forest’s and the Department of Forest’s letter dated 26.4.2005,

Government of Karnataka in Forest Secretariat, in exercise of its

powers conferred upon it under Section 7(2A) of the Lokayukta Act

(in short, “the K L Act”) by Government Order No:FEE 21 FDE

2005 dated 23.6.2006 (Annexure-F), referred the allegations of

illegal activities in the mining and transportation of iron ore in the

Forest lands of Bellary, Hospet and Sandur regions and also

regarding issuance of fake permits to the Hon’ble Karnataka

Lokayukta for thorough investigation and to make specific

recommendation and submit a report, expeditiously, to the

Government. The Offices of the Principal Chief Conservator of



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Forests, Addl. Principal Chief Conservator of Forests (Vigilance),

Conservator of Forests, Bellary Circle, etc., were directed to furnish

documents and records required for investigation.

3. The Government of Karnataka in Commerce and

Industries Secretariat, in continuation of Government order dated

23.6.2006 (Annexure-F), and for the purpose of widening the scope

of illegal mining entrusted to Lokayukta, in exercise of the powers

under Section 7(2A) of the Karnataka Lokayukta Act, 1984, issued

a Government order bearing No CI 164 MMM 2006 dated

12.3.2007 (annexure-G) and referred the actions, for thorough

investigation, and submission of report to the Government. The

scope of investigation by the Lokayukta was to cover the period

commencing from 1.1.2000 to 22.7.2006. The Department of

Mines and Geology, Mysore Minerals Limited and Forest

Department were directed to produce all the documents and

records to the Lokayukta.

4. The background and terms of reference to the

Commission under Section 3 of the Commissions of Inquiry

Act,1952 and the reference of ‘ actions ’ to the Lokayukta under



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section 7(2A ) of the KL Act are one and the same, except

clause (g).

The background for reference/action is as under:

(i) The spurt in the international prices of steel and

iron ore during last 3-4 years has made the

mining and export of high quality iron ore from

the mining in Bellary, Tumkur and Chitradurga

Districts very lucrative. With the average cost of

production of iron ore at around Rs.150 per ton,

and the royalties to be paid to the Government

being abysmally low at Rs.16.25 per ton for

different grades there have been serious systemic

distortions due to the high profit margins. This

has led to allegations of large scale corruption

and complaints of profiteering through illegal

mining with the complicity of the authorities in all

levels of Government.

(ii) The Government in its orders vide notification No.

CI 16 MMM 2003 and No.CI 33 MMM 1994 both

Dated: 15.03.2003, de-reserved for private,

mining an area of 11620 square km in the State,

meant for State exploitation/ mining by the

public sector and notified the surrender of an

area of 6832.48 hectares of prime iron ore bearing



8

lands respectively, which has paved way for

distribution of public assets to select private

individuals / entities without regard to their

professional or technical or business background.

(iii) The entire exercise was undertaken in a manner so

as to benefit only a select few individuals/entities.

The main objectives behind de-reservation i.e. to

encourage mining based industries to create more

employment opportunities in private sector, to

attract private capital and professional

management for optimal use of state mineral

resources were given a go by and allotments were

made to the applicants on considerations other

than merit.

(iv) It has been alleged that in the name of issuing

temporary transportation permits to lift and

transport iron ore in patta lands [which by itselfis nor permissible in law], large scale illegal

mining activity was allowed to be carried out for

certain period, even in the forest areas, having no

link to the survey numbers of patta lands and for

transportation of the illegally mined ore from the

forest areas on the strength of such forest

passes/ transport permits.

(v) It has been reported that the State has been

deprived of its revenues. There have been many

complaints from transporters associations



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regarding overloading of Transport vehicles, that

illegal gratification was sought for allowing

overloading of iron etc., and the repeated

complaints and representations by transporters

associations, it has been alleged to have not been

seriously considered by the Government. It is also

alleged that most of the ore not accounted for and

transported illegally in excess was the outcome of

illegal mining activities.

The issues/actions referred for investigation and

submission of report to the Government are as follows:

(a) Various alleged illegalities, irregularities, events,

issues and executive and other decisions set out

in clause (i) to (viii) and to assess the quantum of

losses to the Government and to suggest remedialmeasures to undo such irregularities and

illegalities.

(b) To enquire into the affairs so the Mysore

Minerals Ltd., (MML) and its commercial activities

carried out in a manner to cause losses to the

company and the instances of direct/ indirect

political interference/ patronage in the

commercial affairs of the company. To fix

responsibility and initiate suitable action, both,

civil and/ or criminal as may be appropriate,



10

against all persons found responsible, including

private contracting parties.

(c) To fix responsibility and initiate suitable action

against all public servants including ministers

whether in office or otherwise state, its

instrumentalities or State owned

Companies/Corporations or other bodies and

authorities, either in collusion with private parties

or otherwise for various acts of omission and

commission leading to various illegalities,

irregularities, events and executive decisions set

out in clause (i) to (viii) and also pertaining to

issues such as:

(1) The process and timing of disposal

of applications, both in case of notified areas

and free areas, for grant of Mining Lease,

Reconnaissance Permits and ProspectingLicenses;

(2) the irregularities reported in issue

of permits by both Forest and Mines

departments;

(3) the irregularities reported in

transportation of minerals such as

overloading, the issue of informal "token

systems", transportation without permits etc;

(4) the entire range of the various

aspects of illegal mining ranging from



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encroachments, mining without necessary

permits and clearances, mining outside the

permitted areas, mining beyond permitted

quantities, illegal transportation of minerals

etc.

(5) the mining and transportation of

major minerals from Patta lands without

valid mining leases etc;

(6) the legality in transfer of leases from

one lease holder to another. This will include

the case wise examination of legality and

validity of grant of mining leases, with

reference to the basic policy/ objectives

behind the decisions taken to de-reserve the

areas meant for exploitation by the public

sector held and surrendered areas and theinstances of direct or indirect political

interference.

(d)All instances where the mandatory regulations

and statutory provisions have been given a go-by

and not observed, including environmental and

other clearances, to directly or indirectly facilitate

and/ or encourage illegal and/ or unregulated

mining operations and to suggest remedial

measures and suitable action against persons



12

found responsible for their commissions and

omissions.

(e) Any other related issues, event and/ or

instance which the Hon'ble Lokayukta may deem

fit and proper to go into the illegal and un-

regulated

mining and related issues, including de-

reservation of the areas meant exclusively for

public sector in Karnataka's mining regions ask

mentioned above.

(f) To comprehensively inquire into the charges,

allegations, complaints of misuse and abuse of

the office, if any elected representatives, ministers

and officers who held or hold offices of profit for

pecuniary benefit pertaining to illegal/

unregulated mining and incidental issues thereof,resulting in loss of revenue to the Government of

Karnataka and Public Undertakings under the

Government of Karnataka.

(g) Illegal granite quarrying in Bangalore Rural

District and other Districts.

5. Originally the scope of investigation by the Lokayukta was

from 1.1.2000 to 22.7.2006. As per the Government Order dated



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9.9.2008 (Annexure-H), the scope of investigation by the

Lokayukta was extend up to 9.9.2008. Again, the Government, by

its notification dated 24.12.2008, extended the scope of

investigation up to 24.12.2008 (vide Annexure-J). On 19.7.2010,

again the Government extended the scope of investigations up to

19.7.2010 (vide Annexure-K). Thus, the scope of investigation by

the Lokayukta was from 1.1.2006 to 19.7.2010.

6. It is pleaded in para-5 of the Writ Petition that

Lokayuktha submitted a report noticing certain irregularities

committed by the former Chief Minister-Sri Dharam Singh and

Smt. Jija Hari Singh, who was the then Managing Director of

Mysore Minerals Limited in relation to the business by Mysore

Minerals Limited, but the report in so far as Sri Dharam Singh,

was not accepted by His Excellency Governor of Karnataka. But, in

the case of the petitioner, no opportunity was given to him before

his indictment and he came to know the same through certain

Television channels reporting that the Lokayuktha had indicted the

petitioner in his report alleging that the petitioner’s children, who

are the Trustees of M/s. Prerana Education Trust have received

donation of 5,00,00,000 on 17.3.2010 and a sum of 5,00,00,000



14

on 18.3.2010 from the mining company- M/s. JSW Steel Ltd., and

that his children and son in law have received `20 crore as sale

consideration, for one acre of land from M/S South West Mining

Ltd. Lokayukta in his Press Conference said that the report had

been leaked and the reports were true. Thus, the petitioner was

held guilty even before the report was submitted. The petitioner,

being Chief Minister of the State, maintained that he would react

to the allegations only after the report is submitted officially. But,

even before the report was submitted an atmosphere was created

as if the Chief Minister has been indicted and he was bound to quit

his Office. Thus, on the alleged two allegations certain political

leaders issued statements questioning the petitioner continuing as

CM though the petitioner was implicated in the Loayukta report.

Though the allegations made against the petitioner was baseless,

on 25.7.2011, he tendered resignation as Chief Minister of

Karnataka and his Excellency the Governor of Karnataka accepted

the same; whereas the Lokayukta forwarded his report on

27.7.2011 to His Excellency Governor of Karnataka. On 3.8.2011

the Governor of Karnataka accepted the report of Lokayukta and

accorded sanction (vide Annexure-M) for initiating criminal



15

proceedings against the petitioner. In pursuance of the

recommendation on 22.8.2011, the Lokayukta registered a case

and issued, FIR against the petitioner, his sons and son-in-law.

7. Sri Ashok Haranahalli, learned Senior Counsel appearing

for the petitioner has urged as under:-

(i) that the impugned report of the Lokayukta is

outside the scope of reference and also in

violation of principles of natural justice;

(ii) that under Section 9 of the KL Act, Lokayukta gets

jurisdiction to inquire into the allegations when a

complaint is lodged by any person or when a

reference is made by the State Government under

Section 7(2A) of the K L Act, subject to

compliance of principles of natural justice;(iii) that the Lokayukta erred in recommending initiation

of criminal proceedings against the petitioner on

the ground of suspicion that the donation

received by M/s. Prerana Education Trust and

the sale consideration by his sons and son-in-law,

as the case may be, from the companies so as to

get favourable reply from the Government;

(iv) that the Lokayukta erred in making the

recommendation without calling for an

explanation either from the petitioner or his sons



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and son in law or Prenana Trust or South West

Mining Company Limited or and Jindal Group of

companies;

(v) that Lokayukta erred in coming to the conclusion

that the petitioner has committed the alleged

offences under the Prevention of Corruption Act,

1988;

(vi) that His Excellency the Governor of Karnataka also

erred in not giving him an opportunity of hearing,

before the acceptance of report of the Lokayukta

and granting an order of sanction to initiate

criminal proceedings against him;

(vii) that on account of acceptance of the unilateral

report of the Lokayukta, the petitioner’s image is

tarnished;

(viii) that Dr. U V Singh’s report indicates that there is no

reference of whatsoever regarding involvement ofthe petitioner in respect of any of the transactions

referred to therein;

(ix) that Dr. U V Singh has recorded in his report that

his observations are not conclusive on the ground

that certain clarifications are required;

(x) that there are glaring contradictions in the report

submitted by Dr. U V Singh;

(xi) that the documents annexed to the report of Dr. U V

Singh themselves show that the petitioner at no



17

point of time either directly or remotely has

shown any favour to South West Mining Limited;

(xii) that it is unfortunate that the Lokayukta has not

even referred to any of the documents before

recommending initiation of criminal proceedings

against the petitioner;

(xiii) that the action of the Lokayukta has, in turn,

resulted in the petitioner demitting the Office of

Chief Minister;

(xiv) that the report of Dr. U V Singh as well as the report

of Lokayukta are based on mere assumptions and

irrational conclusions as M/s. South West Mining

Limited, M/s. Vijayanagar Minerals Pvt. Ltd., and

JSW Steel Limited had all submitted applications

for grant of Mining Lease in Donimalai range in

Sandur Taluk, Bellary District, to the extent of

184.14 hectares, 181.70 hectares and 188.12hectares, respectively, and the applications were

considered by the State Government in the year

2007 itself recommended to grant Mining Lease in

favour of M/s. South West Mining Limited, M/s.

Vijayanagar Minerals Pvt. Ltd., and JSW Steel

Limited on 25.9.2007, 25.9.2007 and

21.9.2007, respectively, during which period the

petitioner was not either holding Mining portfolio

or had any role to play in these aspects;



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(xv) that being aggrieved by the grant of Mining Leases

in favour of the above-said Companies, some

persons namely V.S.Lad & Sons, P.R. Chenna

Reddy and others who were not recommended for

grant of Mining Leases, had challenged the

recommendation before the High Court of

Karnataka in W P Nos.563/2008, 888/2008,

1221/2008, 6960/2008, 4275/2008 and

9404/2008 and they were together heard by a

Division Bench and by order dated 5.6.2009, all

the Writ Petitions were dismissed;

(xvi) that according to Rule 22(4) of the Mineral

Concession Rules, 1960, on receipt of the

application for the grant of a mining lease the

State Government shall take decision to grant

precise area and communicate such decision to

the applicant, who on receipt of thecommunication from the State Government, the

applicant shall submit a mining plan to the

Central Government for its approval; the

applicant shall submit the mining plan duly

approved by the Central Government or by an

officer duly authorized by the Central

Government, to the State Government to grant

mining lease over that area. Therefore, the grant

of approval of the mining plan was a matter,

which was between the Central Government and



19

the Companies and there was no question of

making favourable or unfavourable reply from the

State Government in this regard;

(xvii) that the Government of India had sent three letters

to the Director, Department of Mines and Geology

to report as to the legal status of the Special

Leave Petition filed by M/s. V S Lad & Sons. With

reference to the letters of the Central

Government, the above-said Companies

themselves replied to the Ministry of Mines,

Government of India, clarifying that the Special

Leave Petition was pending before the Supreme

Court and that there was no stay order granted

by the Court;

(xviii) that the three Companies viz., M/s. South West

Mining Company, M/s. JSW Steels Limited and

M/s. Vijayanagar Minerals Pvt. Ltd., addressedletters dated 31.3.2010, 5.3.2010 and 31.3.2010,

respectively, to the Director of Mines and Geology,

stating that there was no stay order granted by

the Supreme Court. The Director of Mines and

Geology, on clarification sought by the Ministry of

Mines, Government of India, addressed three

letters on 17.8.2010, 18.3.2010 and 29.4.2010

and brought about legal status of the Special

Leave Petition, but the petitioner was implicated

for no fault of his own;



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(xix) that the Lokayukta has adopted pick and choose

method while considering the documents, which

leads one to conclude that the same was done

only to indict the petitioner in the report;

(xx) that the registration of the First Information Report

by the Lokayukta Police for the offence under

Sections 7,8,9 and 13(1)(d) r/w Section 13(2) of

Prevention of Corruption Act is illegal;

(xxi) that the petitioner had filed Writ Petition in

No.29439/2011 on an earlier occasion

challenging the preliminary report of the

Lokayukta, and during the pendency of the Writ

Petition, as the report was accepted by His

Excellency Governor of Karnataka, complaint was

filed and FIR was issued, the petitioner withdrew

the Writ Petition, but there was no decision on

merits;(xxii) that the registration of case suo motu by the

Superintendent of Police, Lokayukta, is also bad

in law as on the same allegation, one Sirajun

Basha has instituted a private complaint in PCR

No.2/201 arraying the petitioner and others as

accused challenging de-notification of land in Sy.

No.55/1 and that the said land was purchased by

Sri Raghavendra, Sri Vijayendra and Sri Sohan

Kumar and the same was sold in favour of South

West Mining Company Limited and according to



21

the said complaint, by such sale, illegal

gratification was paid to the petitioner and an

enquiry has been ordered;

(xxiii) that now the Lokayukta, in its report, states that

the transaction entered between the sons and

son-in-law of the petitioner on the one hand and

South West Mining Limited on the other is a

sham transaction when an enquiry is pending

before the Lokayukta Police;

(xxiv) that it is impermissible in law for the Lokayukta

Police registering two cases for the alleged crime

and the FIR is liable to be quashed;

(xxv) that when the Lokayukta Court has seized the

matter, it is not permissible for the same

Lokayukta Police to once again make an

investigation into the same;

(xxvi)

that according to Sections 9,12 and 13 of the K LAct, issuance of notice and hearing of the

delinquent is contemplated in all stages and any

adverse recommendation/report/finding requires

to be made only after hearing the persons

concerned;

(xxvii) that the Lokayukta, while dealing with Chapter-22,

recommended prosecution of the petitioner under

the provisions of Prevention of Corruption Act,

1988 and having regard to the position of the

petitioner as Chief Minister, the recommendation



22

must be construed to be a recommendation of

removal;

(xxviii) that the petitioner was never heard either during the

investigation or before the acceptance of the

report by the competent authority and therefore

both the investigation and acceptance of the

report are violative of Sections 9,12 and 13 of K L

Act;

(xxix) that the petitioner made a representation dated

1.8.2011 to the Lokayukta seeking re-

consideration of the report and give him an

opportunity to substantiate his claim, but the

same was not considered;

(xxx) that the Lokayukta has not followed the procedure

as provided in sub-Sections (3) and (4) of section

9 of the KL Act;

(xxxi)

that Lokayukta, in its report, has relied upon the judgment of a Single Judge reported in ILR 1990

KAR 798 in the case of Dr. K Chowdappa Vs.

State of Karnataka, to hold that in a reference

under Section 7(2A) there is no necessity to give

an opportunity as contemplated under Section

9(3) of theKL Act, ignoring the decision otherwise

rendered in N Gundappa Vs. State (reported in

ILR 1990 KAR 223), which was affirmed by

Division Bench of this Court (reported in ILR

1990 KAR 4188).The above said decision was



23

followed in another case in W P No.33151/2001

(Arjundas Vs. State). Thus compliance of Section

9(3) of the KL Act, is mandatory even in the case

of investigation of the action on a reference made

under section 7(2A) of the KL Act;

(xxxii) that in the decision reported in ILR 2004 KAR 3892

(Prof. S N Hegde Vs. Lokayukta), it was held that

as the finding recorded by the authorities after

such investigation would have serious

consequences, resulting in civil consequences,

naturally the minimum that is expected in such

an investigation or enquiry is that the person

conducting the investigation should follow the

principles of natural justice;

(xxxiii) that in the absence of complaint and no

substantive evidence to prove the factum of

demand, presumption cannot be drawn (relied on(2009) 6 SCC 587 - A SUBAIR Vs. STATE OF

KERALA);

(xxxiv) that when the averments made in the complaint are

cryptic, the order of Magistrate directing

investigation under Section 156(3) without

applying his mind to the allegations made in the

complaint is bad in law (relied on 1999 CRL. L.J

3909: GURUDUTH PRABHU AND OTHERS Vs. M

S KRISHNA BHAT AND OTHERS);



24

(xxxv) that Police investigation under Section 157 of Cr. P

C, can be commenced only if FIR prima facie

discloses commission of a cognizable offence and

when such an offence is not disclosed, the court

is justified in interfering with the investigation

and quashing the same under Art. 226 and 227 of

the Constitution of India (relied on (1982) 1 SCC

561 (STATE OF WEST BENGAL AND OTHERS Vs.

SWAPAN KUMAR GUHA AND OTHERS);

(xxxvi) that power of the Court to discharge the accused at

the stage of framing charge or existence of remedy

of appeal and revision is not a bar to invoke the

jurisdiction of the High court under Article 227 or

Section 482 of Cr. P C (relied on (1998) SCC 749

(PEPSI FOODS LTD. AND ANOTHER Vs. SPECIAL

JUDICIAL MAGISTRATE AND OTHERS);

(xxxvii)

that it is open to the petitioner to withdraw apetition filed by him. Normally, a court of law

would not prevent from withdrawing his petition.

But, if such withdrawal is without the leave of the

court, it would mean that the petitioner is not

interested in prosecuting or continuing the

proceedings and he abandons his claim. In such

cases, obviously, public policy requires that he

should not start a fresh round of litigation and

the court will not allow him to re-agitate the claim

which he himself had given up earlier(relied on



25

(2008) 14 SCC 58 :RAMESH CHANDRA SANKLA

AND OTHERS Vs. VIKRAM CEMENT AND

OTHERS);

(xxxviii) that where the cause of action and the relief

claimed in the second suit are not the same as

the cause of action and the relief claimed in the

first suit, the second suit cannot be considered to

have been brought in respect of the same subject

matter as the first suit (relied on AIR 1970 SC

987 (VALLABH DAS Vs. DR. MADANLAL AND

OTHERS);

(xxxix) that withdrawal or abandonment of a petition under

Articles 226/227 without permission to file fresh

petition there under would bar such a fresh

petition in the High Court involving some

subject matter (relied on (1987) 1 SCC 5

(SARGUJA TRANSPORT SERVICE Vs. STATE OF TRANSPORT APPELLATE TRIBUNAL, M P

GWALIOR, AND OTHERS);

(xl) 1983 (1) SCC 124 (BOARD OF TRUSTEES OF THE

PORT OF BOMBAY Vs. DILIPKUMAR

RAGHAVENDRANATH NADKARNI AND OTHERS)

on the point where employer appoints legally

trained personnel for presenting and prosecuting

the case in the enquiry when delinquent officer

was arrested by another officer, who was not

shown to be legally trained person, the enquiry



26

would be one sided, enquiry weighed against the

Officer and would result in violation of one of the

essential principles of natural justice, namely,

that a person against whom enquiry is held must

be afforded a reasonable opportunity to defend

himself;

(xli) (1985) 3 SCC 545 (OLGA TELLIS AND OTHERS Vs.

BOMBAY MUNICIPAL CORPORATION AND

OTHERS) on the point that procedure established

by law must be reasonable, just and fair.

Authority exercising statutory power must act

reasonably,otherwise the procedure prescribed by

the statute itself would be deemed to be un-

reasonable and violative of Article 21 of the

Constitution on the ground of procedural

unreasonableness;

(xlii)

(1986)(4) SCC 537 (INSTITUTE OF CHARTEREDACCOUNTANTS OF INDIA Vs. L K RATNA AND

OTHERS) on the point that delinquent member of

Institute of Chartered Accountants of India is

entitled to be afforded an afforded an opportunity

of hearing by the Council of the Institute before

taking decision on the question of his guilt,

irrespective of the fact that a hearing had already

been given to him in proceedings before

Disciplinary Committee and that an appeal lay

against the Council’s decision before High Court,



27

the decision of the Council, in the absence of

such an opportunity of hearing, liable to be

quashed;

(xliii) (2003)8 SCC 361 (STATE OF BIHAR Vs. LAL

KRISHNA ADVANI AND OTHERS) on the point

that person, whose conduct is being inquired into

or who is likely to be prejudicially affected by the

inquiry, notice to such person being a sine qua

non of the principles of natural justice, failure to

comply with principles of natural justice-audi

alteram partem would affect the right of an

individual. Right to reputation is a facet of right

to life. Hence, right of an individual can be

heard, before being adversely remarked by the

Commission of Inquiry, is statutorily recognised;

(xliv) (2007) 3 SCC 587 ( STATE OF MAHARASHTRA Vs.

PUBLIC CONCERN FOR GOVERNANCE TRUSTAND OTHERS) on the point passing adverse

remarks/observations against CM, who was not

party before High Court, without calling any

explanation from him did not merit consideration.

Condemnation of CM without affording

opportunity of hearing to him was a complete

negation of principles of natural justice. Hence,

the remarks/strictures passed against CM were

illegal, incorrect and unwarranted. Hence, were

liable to be expunged;



28

(xlv) (2003)3 SCC 542 (DIVINE RETREAT CENTRE V.

STATE OF KERALA AND OTHERS) on the point

that the jurisdiction under section 482 of Cr.P.C

has to be exercised sparingly, carefully and with

caution only where such exercise is justified by

the test laid down in section 482 itself. The three

circumstances under which inherent

circumstances may be exercised are: (a)to give

effect to an order under the Cr.P.C (b)to prevent

abuse of the process of the court; and (c) to

otherwise secure ends of justice.

High court, in the exercise of its writ jurisdiction

under Art.226 can interfere with the investigation

only in the rarest of the rare case where as case of

abuse of power of investigation and non-

compliance with the provisions under Chapter XII

of Cr.P.C is clearly made out. But even in suchcases, High court cannot direct the police as to

how the investigation is to be conducted, but can

always insist for the observance of the process as

provided for in Cr.P.C.

(xlvi) ILR 1994 KAR 3595 (S RANGANARASAIAH

Vs. STATE OF KARNATAKA) on the point that

under Section 9(3)(a) of the K L Act, a copy of the

complaint shall be forwarded to the public

servant and the competent authority concerned,

after making preliminary enquiry under sub-



29

Section (3). An opportunity to offer his comments

on such complaint shall be afforded to the public

servant under Clause (b) of sub-Section (3). The

said provision is mandatory. The opportunity

that should be given to a public servant is not

merely based on principles of natural justice is a

mandatory statutory provision.

8. Respondent No.2/State of Karnataka did not file

statement of objections and Learned High Court Government

Pleader Smt. Revathy Adinath Narde, did not submit any

arguments.

9. Respondent Nos.1 and 3 viz., the Lokayukta and

Superintendent of Police of Karnataka Lokayukta, have filed a

joint statement of objections stating that the Writ Petition is not

maintainable; on the basis of Dr. U V Singh’s report on illegal iron

ore mining in the State of Karnataka; Lokayukta submitted the

report and recommended suitable action; on the basis of the report

the Governor of Karnataka has issued Prosecution Sanction Order

with liberty to the Lokayukta to take further necessary action and

on the basis of the Sanction Order case has been registered in



30

Crime No.36/2011 for the offences under Sections 7,8,9,13(1)(d)

r/w Section 12(2) of Prevention of Corruption Act, 1988 and the

same is being investigated. They have denied the case of the

petitioner that he had no role in recommending the proposal given

by the Companies for mining plan and that he has not shown any

favour or abused his office. It is stated that a sum of `10 crores

has been remitted to M/s. Prerana Education Trust, of which the

children of the petitioner are Director and Trustees. It is also

stated that the children and son-in-law of the petitioner have

received remittances to the extent of `20 crores through cheques,

to their individual Bank accounts. It is stated that the law laid

down in Prof. S N Hegde and Another Vs. The Lokayukta,

Bangalore and Others is not applicable to the present case. The

complaint filed by Sirajuddin Pasha in PCR No.2/2011 later

registered in Crime No.36/2011 is nothing to do with present case

and prayed for dismissal of the petition.

10. Sri B A Belliappa, learned Counsel appearing for

respondent Nos.1 and 3, submitted that admittedly huge amount

of 10 crores is paid to M/s. Prerana Education Trust, of which the



31

children of the petitioner are the Director and Trustees and in the

other case, 1 acre of property, which was worth about ` one crore

was sold for `20 crores and on account of the admitted money

transactions and documents collected during the course of

investigation by Dr. U P Singh, a prima facie case is made out and

after careful consideration of the report, Sanction Order was issued

and case has been registered in Crime No.36/2011 for the offence

under Sections 7,8,9,13(1)(d) r/w 12(2) of Prevention of Corruption

Act, 1988, and investigation taken is up and there is no merit in

the Writ Petition.

11. Respondent No.4/ the Principal Secretary to Governor of

Karnataka, has filed statement of objections contending that the

petition is not maintainable as it is barred by the principles of res

judicata in view of dismissal order dated 29.8.2011 made in W P

No.29430/2011; as the authorities have registered FIR and the

proceedings are governed by the Code of Criminal Procedure, the

present Writ Petition is not maintainable. Without prejudice to the

above grounds urged, it is stated that the Lokayukta investigated

the reference made by the Government and therefore the process of

affording an opportunity to the petitioner to offer his comments



32

contemplated under Sub-Section (3) of Section 9 of the K L Act is

not applicable to the proceedings initiated pursuant to the

reference made by the State Government under Section 7(2A) of

the KL Act. It is pleaded that Lokayukta submitted his report on

illegal mining recommending for initiation of criminal proceedings

and the petitioner’s decision to demit the Office was not based on

any declaration made by the Lokayukta, but it was because of

other reasons, which may be political or otherwise. Thus, denied

all the grounds urged in the Writ Petition and prayed for dismissal

of the Writ Petition.

12. Sri Naganand, learned Senior Counsel appearing for

respondent No.4, submits that the Petition is not maintainable on

two scores viz., since the petitioner’s Writ Petition in

No.29430/2011 filed under Articles 226 & 227 of the Constitution

of India against Lokayukta, praying for quashing the report

(Chapter-22) dated 27.7.2011, in so far as it relates to

recommendation, was dismissed unconditionally by order dated

29.8.2011; the present petition filed under Articles 226 and 227 of

the Constitution of India for quashing FIR in Cr. No 36/2011 is not



33

maintainable in law. With regard to the merits of the case is

concerned, he submits that question of affording an opportunity of

hearing the petitioner does not arise as the investigation was

conducted in pursuance of the reference made by the Government

under Section 7(2A) of the KL Act and the provisions of Section 9

are not applicable. He relies on the following decisions:

(i) AIR 1987 SC 88 (SARGUJA TRANSPORT

SERVICE Vs. STATE TRANSPORT APPELLATE

TRIBUNAL, GWALIOR AND OTHERS) on the

point that withdrawal of Petition under Article

226 without permission to institute a fresh

petition is not maintainable;

(ii) AIR 1996 2450 (CH. RAMA RAO Vs. THE

LOKAYUKTA AND OTHERS) on the point that it

would not be necessary to issue notice or give

opportunity to a public servant at preliminary

verification or investigation. When the

Lokayukta or Up-Lokayukta, as the case may be,

conducts a regular investigation into the



34

complaint, it would be necessary to give prior

opportunity to the public servant, etc;

(iii) AIR 1984 SC 273 (K L TRIPATHI Vs. STATE

BANK OF INDIA AND OTHERS) on the point

whether principles of natural justice has been

violated or not has to be judged in the

background of nature of charges, nature of the

investigation conducted in the back ground of

any statutory or relevant Rules governing such

enquiries;

(iv) AIR 2007 SC 1527 (SECRETARY, A P SOCIAL

WELFARE RESIDENTIAL EDUCATIONAL

INSTITUTIONS Vs. PINDIGA SRIDHAR & ORS.)

on the point that to sustain the complaint of the

violation of principles of natural justice one

must establish that he was prejudiced for non

observance of the principles of natural justice;

(v) AIR 1996 SC 186 (SUPERINTENDENT OF

POLICE Vs. DEEPAK CHOWDHARY AND

OTHERS) on the point that the question of



35

giving opportunity to the charged Officer before

granting sanction does not arise since it is not a

quasi judicial function. Grant of sanction is an

administrative function. What is required is that

the investigating officer should place all the

necessary material before the sanctioning

authority who should apply his mind to the

material and accord sanction. Therefore, the

question of giving opportunity of hearing to the

accused before granting sanction under Section

6 of the Prevention of Corruption Act, 1947 does

not arise;

(vi)

AIR 2004 SC 86 (ASSISTANT COMMISSIONER,

ASSESSMENT-II, BANGALORE AND OTHERS

Vs. M/S. VELLIAPPA TEXTILES LTD. AND

OTHERS) on the point that an order of sanction,

by itself, does not have the effect of a conviction

or imposing a penalty causing any injury of any

kind on the accused. The accused will get full

opportunity to defend him in the trial and the



36

trial will take place in accordance with

procedure established by law.

13. In the light of the arguments addressed by the learned

Counsel for the parties, we formulate the following points for our

consideration:

(i) Whether the present Writ Petition is

not maintainable on the ground that

the petitioner’s earlier Writ Petition

No.29430/2011 was dismissed on

29.8.2011 as withdrawn

unconditionally?

(ii)

Whether the present petition is notmaintainable on the ground that

there is a specific provision under

Section 482 of Cr.P.C for quashing

criminal proceedings?

(iii) Whether Lokayukta’s report called

“M/S SOUTH WEST MINING

COMPANY LIMITED at Chapter-XXII

(at Annexure-W) is within the scope

of reference of action made by the



37

Government of Karnataka under

section 7(2A) of the KL Act?

(iv) Whether Lokayukta was required to

comply with clauses (a) and (b) of sub

section (3) of Section 9 of the KL Act?

(v) Whether a prima facie case is made

out by the Lokayukta for registering a

case for the offences under section

7,8,9 and 13(1)(d) r/w section 13(2) of

the Prevention of Correction

Act,1988, at annexure-A?

(vi) whether the order of sanction

granted by the Governor to initiate

criminal proceedings against the

petitioner and consequently

registering case in Cr.No.36/2001 for

the offences under section 7,8,9, and13(1)(d) r/w section 13(2) of the

Prevention of Corruption Act,1988, at

annexure A-1 are liable to be

quashed?

(vii) What order?

14. Our answer to the above points is as under:-

Point No (i): In the Negative.

Point No (ii): In the Negative.



38

Point No (iii): In the Negative.

Point No (iv): In the Affirmative.

Point No. (v): In the Negative.

Point No. (vi): In the Affirmative.

Point No. (vii): As per final order.

Point No (i) and (ii)

15. Preliminary objections raised by the respondents are

(i)that Writ Petition in W P No.29430/2011 (GM-KLA), in so far it

relates to the recommendation/report made by the Lokayukta

against the petitioner for initiation of prosecution was withdrawn

unconditionally and therefore the present petition is not

maintainable; (ii) that since the petitioner has sought for relief of

quashing complaint dated 22.8.2011, FIR in Crime No.36/2011

for the offences under Sections 7,8,9 and 13(1)(d) r/w Section 13(2)

of P C Act, on the file of 3rd respondent/Superintendent of Police,

Karnataka Lokayukta, Bangalore, the petition under Art. 226 and

227 of the Constitution of India is not maintainable as the remedy

lies under section 482 of Cr.P.C



39

16. We have perused the file relating to W P No.29430/2011

(GM-KLA). When the Petition was listed for orders on 29.8.2011,

Sri Ravi B Naik, learned Senior Counsel appearing for the

petitioner, submitted that the Petition may be dismissed as

withdrawn. In view of the submission made by the learned Senior

Counsel, the Division Bench dismissed the Writ Petition as

withdrawn, but added a rider “unconditionally”. In this regard, Sri

Ashok Haranahalli, learned Senior Counsel, submits that as on

29.8.2011 the Writ Petition became infructuous, as the Governor

granted an order of Sanction for prosecution and on 22.8.2011

respondent No.3/Superintendent of Police, Sub Division,

Lokayukta, registered a case in Crime No.36/2011 for the offences

under the P C Act and issued FIR. Since the petitioner had to

challenge registering the case in Crime No.36/2011, the Writ

Petition was withdrawn, but the Division Bench of this Court erred

in adding a rider “unconditionally”.

17. It is pertinent to mention that when the aggrieved

persons approach Courts, pleading violation of fundamental rights,

rights cannot be curtailed. In other words, if the Court is of the



40

view that there is no merit in the Writ Petition, it should pass an

order on merits, so that the aggrieved party will have an

opportunity to challenge the same before the appellate Court. But,

in the instant case, there is no mention that the matter was heard

and when the Court came to a conclusion that there was no merit

in the Writ Petition, learned Counsel for the petitioner offered to

withdraw the Writ Petition unconditionally. In view of the fact

that respondent No.3 herein had already registered a case in Crime

No.36/2011 for the offences under P C Act, the right course of

action was to dismiss the petition as withdrawn with liberty to take

such course of remedy available in law. In this regard, learned

Counsel for the petitioner as well as respondents relied upon a

decision reported in AIR 1987 SC 88 (SARGUJA TRANSPORT

SERVICE Vs. STATE TRANSPORT APPELLATE TRIBUNAL,

GWALIOR AND OTHERS) on the point that withdrawal of Petition

under Article 226 without permission to institute a fresh petition is

not maintainable. He submits that since the Writ Petition was

withdrawn with permission; petitioner is entitled to file another

Writ Petition with reference to the grounds urged in the Writ

Petition as well as other contention in view of subsequent events.



41

The decision cited by the learned Counsel for the petitioner

supports the case of the petitioner. Therefore, in our view, the

order of dismissal of the Writ petition would not come in the way of

the petitioner challenging the subsequent orders, etc., on all

grounds. Since the case was not decided the doctrine of res

judicata is not applicable to the case on hand.

18. The other contention is that since the petitioner is

praying for quashing the complaint and FIR in Crime No.36/2011,

and in view of Section 482 of Cr.P.C, the Writ Petition is not

maintainable.

19. The petitioner has questioned the very validity of the

report of Lokayukta, order of sanction by the Governor, the

complaint and issuance of FIR in Crime No.36/2011 on various

grounds. Sri. Ashok Haranalli relies upon the following decisions

reported in:

(i) 1992 SUPP (1) SCC 335 (STATE OF HARYANA

AND OTHERS Vs. BHAJAN LAL AND

OTHERS), on the point that extraordinary



42

power under Article 226 or the inherent

powers under Section 482 of Cr.P C can be

exercised by the High Court, either to prevent

the abuse of process of any court or

otherwise to secure the ends of justice.

(ii) (2008)3 SCC 542 (DIVINE RETREAT

CNETRE Vs. STATE OF KERALA AND

OTHERS) on the point the jurisdiction under

Section 482 of Cr. P C., is not an unlimited

arbitrary jurisdiction; Power under Section

482 of Cr. P C has to be exercised sparingly,

carefully and with caution only where such

exercise is justified by the test laid down in

Section 482 itself. The three circumstances

under which inherent jurisdiction may be

exercised are: (a) to give effect to an order

under the Cr. P C; (b) to prevent abuse of the

process of the Court; and (c) to otherwise

secure ends of justice. High Court, in exercise

of its writ jurisdiction under Article 226 can

interfere with the investigation only in the



43

rarest of the rare case where as case of abuse

of power of investigation and non-compliance

with the provisions under Chapter XII of Cr. P

C is clearly made out.

20. Reputation of a man is a very precious thing; the man

cherishes most in his life. It is a natural or absolute right of a

man. In fact, the whole exercise which a man undertakes in life is

to acquire fame, name and reputation. No office which a man

occupies in life is permanent. Therefore, between the removal of

the man from that office and damage to his reputation what he is

afraid of his damage to the reputation. Office does not last but

reputation is permanent. In fact, the reputation outlives a man.

Therefore, the wide interpretation placed to the word ‘life’ in Article

21 of the Constitution, leads to inevitable inference that Article 21

of the Constitution not only should be taken to mean protection of

one’s life and liberty while a person is alive, but equally covers the

reputation of a person during his life and after. Any wrong action

by the State or its agencies which sullies the reputation of a

virtuous person would certainly come under the scope of Article 21



44

of the Constitution”. Thus right to reputation is a part of right to

life, which a fundamental right guaranteed to every citizen under

Article 21 of the Constitution. Hence, no person should be deprived

of such right to reputation, except in accordance with the

procedure established by law (vide 2004(3) KAR. L.J. 505 - PROF.

S N HEGDE Vs. THE LOKAYUKTA, BANGAORE AND OTHERS).

21. It was a fit case to call for response of the petitioner with

regard to allegations, but both the authorities have failed to follow

the principles of natural justice. It is pertinent to mention that the

author of the report himself suspects as to the role of the petitioner

in so for the amounts received by the Trust and kith and kin of the

petitioner. The decision relied upon by the petitioner supports the

case of petitioner and the provision under section 482 of Cr.P.C,

cannot take away or trammel the jurisdiction of this under article

226 and 227 of the Constitution of India. There is a flagrant

violation of principles of natural justice/ statutory provisions; it is

a fit case to hold that there is no merit in the preliminary

objections raised by the respondents as to the maintainability of



45

the Writ Petition. Hence, we answer the point No.(i) and (ii) in the

negative.

Point Nos. (iii) to (vii)

22. Since the material on these points is interlinked and

overlapping, we proceed to take up these points together for

consideration.

23. The K L Act, 1984 was enacted by the Karnataka

Legislature accepting the recommendations of the Administrative

Reforms Commission “to constitute the institution of

Lokayukta for the purpose of improving the standards of

public administration, by looking into complaints against

administrative actions, including cases of corruption,

favoritism and official indiscipline in administration

machinery and all other allied matters”. The President of India

gave his assent to the Bill on 16th day of January, 1985. The Act

came into force on 15.1.1986 abolishing the Vigilance Commission.

According to Section 2(5) of the K L Act, “corruption ”- includes



46

anything made punishable under Chapter IX of the Indian Penal

Code, 1860 or under the Prevention of Corruption Act, 1947.

Sections 161 to 171 of I P C deal with the offences by public

servant. Sections 161 to 165-A of IPC were omitted by the P C Act,

1947. It was done with an intention to make the anti-corruption

laws more effective by widening their coverage and by

strengthening the provisions. The P C Act, 1947 and the Criminal

Amendment Act, 1951 were repealed under Section 30 under the P

C Act, 1988. Corruption is deep rooted in the society. Even to get a

Birth Certificate/Death Certificate, one has to oil the palm. In spite

of the Indian Penal Code and Prevention of corruption Act, 1947,

the State of Karnataka has brought a legislation viz., the

Karnataka Lokayukta Act, 1984, but in vain.

24. Dictionary meaning of word “Corruption ” means, the

process of corrupting or condition of being corrupt. “Bribe ” means,

a gift, usually of money, offered to someone to persuade them to do

something illegal or improper; something offered to someone in

order to persuade them to behave in a certain way.



47

25. The definition of a “public servant” under Section 2(c) of

P C Act, 1988 includes 12 authorities. The holder of a public office

such as the Chief Minister is a public servant (vide M.Karunanidhi

v. Union of India ,AIR 1979 SC598 ). The society expects that every

public servant should have human approach and honest. Why

corruption is growing in our society? One of the reasons for

corruption appears to be Election. In our view, a person with

“corrupt mind” is also “corrupt” and he would be most dangerous

to the society than the other. Is it not offering TV, wet grinder etc.,

to the voters after the election is over amounting to corruption? It

is the high time that the Representation of the People Act, 1950

has to be amended.

26. Now coming to the point for consideration, we have to

take note of the background for the Government making a

reference to the Lokayukta. It is pertinent to state that the

government had rightly made use of the Commissions of Inquiry

Act, 1952 and appointed Justice U L Bhat Commission. The

background and the terms of reference for the said commission

and the reference/action under section 7 (2A) of the KL Act are



48

one and the same, except the one that is relating to illegal granite

quarrying in Bangalore Rural District and other districts. The

commission appointed under section 3 of the Act, has jurisdiction

and authority to inquire into any definite matter of public

importance and to perform such function and within such time as

may be specified in the Notification. The Commissions of Inquiry

Act provides all the necessary powers to the commission for the

purpose of investigation. Further, section 8-B provides that

persons likely to be prejudicially affected shall be heard. It is

relevant to note that success of the commission depends not only

on proper selection of the head of commission but also on his

devotion and dedication to discharge his duty in public interest

without fear or favour. As per section 7 of the KL Act Lokayuta

may investigate any action which is taken by or with the general or

special approval of the authorities. As per sub section 2A of

section 7, notwithstanding contained in sub-sections (1) and (2),

the Lokayuta may investigate any “action” taken by or with the

general or specific approval of a public servant, if it is referred to

him by the State Government. Sub-section (1) of section 2 defines

the term “Action” as an administrative action taken by way of



49

decision, recommendation or finding or in any other manner and

includes willful failure or omission to act and all other expressions

relating to such action shall be construed accordingly. Section 8 of

the KL Act says the matters not subject to investigation. Section 9

of the KL Act is relating to complaints and investigations by the

Lokayukta. Since the petitioner has urged that even in cases

referred under section 7(2A) of KL Act the lokayukta should have

complied with clause (a) and (b) of sub section 3 of section 9, it is

useful to excerpt the same for immediate purpose. It reads as

under:

“(3) Where the Lokayuta or an upa-

lokayukta proposes, after making such

preliminary inquiry as he deemed fit, to conduct

any investigation under this Act, he:-

(a) shall forward a copy of the complaint

and in the case of an investigation initiated suo

motu by him, the opinion recorded by him to

initiate the investigation under sub-section (1)

or (2), as the case may be, of section 7 to the

public servant and the Competent Authorityconcerned;

(b) shall afford to such public servant

and opportunity to offer his comments on such



50

complaint or opinion recorded under sub-

section (1) and (2) of section as the case may

be;

(c) may make such order as to the safe

custody of documents relevant to the

investigation, as he deems fit.”

27. In the decision reported in ILR 1990 Kar 223

(N.Gundappa v. State of Karnataka), it was held that the

investigation by Lokayukta is a quasi judicial power and the

authority shall follow the rules of Natural justice. Therefore, it was

necessary for the lokayukta to send a copy of the complaint to the

petitioner and to the Competent Authority and afford an

opportunity to the petitioner to offer his comments on the said

complaint. Thus, it was held that Clause (a) and (b) of sub-section

(3) of section 9 are to be complied with in the manner provided

therein. The decision of learned single judge was confirmed by

Division bench of this court. Division Bench has held that having

regard to the serious consequence contemplated under section 13

and 14 of the KL Act, provisions of clause (a) and (b) of sub section

(3) of section 7 have to be complied (vide State of Karnataka v.

N.Gundappa - reported in ILR 1990 KAR 4188).



51

28. The scheme of KL Act does not deal with PUBLIC

INTEREST matters. Keeping in view the volume of work and public

interest, appointment of a commission is more meaningful, as all

the persons concerned can take part in the Commission of

Enquiry. The Commission is bound to follow the Principles of

Natural justice. There cannot be any discrimination in so far

investigation of cases under Section 9(1) or under section 7(2A)

and compliance of section 9(3)(a)and (b) of the KL Act. Further,

there is no material produced by the Lokayukta to establish that

the petitioner has done any favour to any of the alleged companies

during the period 2007 to 2010. Even during the course of

arguments a specific question was put to the learned counsel for

the Lokayukta to produce any material to connect the petitioner for

the alleged offences, but he was mum. Suspicion cannot be a

ground to tarnish the image and reputation of a person who is

holding a constitutional post. Courts shall decide on the materials

produced by the police or party; whereas the commission has to

collect materials by inquisitorial method by investigation; if

necessary, to inquire into truth or otherwise of the facts available.

The commission of Inquiry Act is perhaps unique in the world



52

where the commission takes the role of investigator, prosecutor,

defender and judge of facts, with due safeguards of the rights of

the involved parties as in a juridical proceeding, though it is not.

29. Lokayukta being a quasi-judicial authority, his decisions

should be reasoned. The writ of certiorari will lie to set aside the

decisions made in violation of the principles of natural justice.

When important rights of parties of far-reaching consequence are

adjudicated in a summary fashion, without giving a personal

hearing where proposals and counter proposals are required to be

examined, otherwise it would be directly destructive of judicial

propriety and fair-play. The catena of decisions cited by the

learned counsel of the petitioner on the point of violation of

principles of natural justice supports the case of the petitioner. The

contention of Respondent/Lokayukta that he has not given any

direction for the petitioner to vacate his office and therefore

question of giving him an opportunity of hearing the petitioner did

not arise, holds no water, as the petitioner was the Chief Minister

when the report was leaked through media as to his indictment

and lot of dust was created in the political circle and on moral



53

ground the petitioner resigned as CM. He was condemned un-

heard. In a nut shell, there is no material placed on record to

establish that the petitioner has shown any official favour to the

companies. The SLP challenging the grant of lease is still pending

before Supreme Court. Mining lease was granted in favour of the

above said companies, by the State in the month of September

2007, during which period, the petitioner was neither a mining

Minister nor a Chief Minister. As per Rule 22(4) of the Mineral

Concession Rules, 1960, approval of mining plan is vested in the

Central Government. Therefore, the petitioner showing any official

favour to the companies during the year of 2007 to 2010 is beyond

any ones comprehension.

30. Further, reference of action made to the Lokayukta is

under section 7(2A) of KL Act, is in relation to illegalities and

irregularities in mining in Bellary, Tumkur, and Chitradurga

Districts, from 1.1.2006 to 19.7.2010. The report of Lokayukta at

Chapter No22 is based on Dr.U.V.Singh’s report, it is captioned as

“M/S South West Mining Company Limited”. It has no connection

with illegalities/irregularities in the mining. Therefore, we hold that



54

report of the Lokayukta is also not within the scope of reference

made to it by the Government.

31. On careful examination of the case of the petitioner, the

statement of objections and decisions cited by the learned Senior

Counsel for the petitioner and learned Senior Counsel for

respondent No.4, we are of the considered view that the petitioner

was condemned unheard and there is flagrant violation of

principles of natural justice/maxim “audi alterm partem ”/fairness

in administrative action and statutory provisions. The decisions

cited by Sri Naganand, learned Senior Counsel, for respondent

No.4 are of no avail. Hence, we answer point Nos. (iii) & (v) in the

negative and Point Nos. (iv) & (vi) in the affirmative in favour of

the petitioner.

32. For the reasons said supra, we pass the following

ORDER

Writ Petition is allowed. The complaint dated 22.8.2011 (at

Annexure-A); FIR registered in Crime No.36/2011 for the offences

under Sections 7,8,9 and 13(1)(d) r/w Section 13(2) of the



55

Prevention of Corruption Act, 1988 (at Annexure-A1) on the file of

respondent No.3; the Order of Sanction dated 2.8.2011 (at

Annexure-B) on the file of respondent No.4 and the relevant

portion of the Report at Chapter-XXII of the Karnataka Lokayukta

dated 27.7.2011 (at Annexure-C) on the file of the Karnataka

Lokayukta are quashed.

Sd/-[Dr. K. BHAKTHAVATSALA]

Judge

Sd/-(K. GOVINDARAJULU]

Judge

Bjs

karnataka hc judgment exonerating bsy

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