NOIDA ENTREPRENEURS ASSOCIATION v. NOIDA & Ors.

Judgment

8 S.C.R. 25 NOIDA ENTREPRENEURS ASSOCIATION v. NOIDA & ORS. (Writ Petition (Civil) No. 150 of 1997) MAY 9, 2011 [G.S. SINGHVI AND DR. B.S. CHAUHAN, JJ.] A B Prevention of Corruption Act, 1988 - s.13 - Criminal misconduct by public servant - Land scam - Respondent no.4 was CEO, New Okhla Industrial Development Authority C (NO/DA) in 1993-1994 - A/legation that during this period, he committed three acts of misconduct - 1) that he allotted contracts worth Rs. 10 crores to different contractors on selection basis without inviting tenders; 2) that he caused financial loss to NO/DA by not paying conversion charges with D respect to the plot allotted to him and 3) that at his instance a 13 hectwe City Park situated in NO/DA was destroyed and by changing the land use, a new residential Sector in violation of the Master Plan was carved out comprising of 200 plots - Held: The a/legations being of a very serious nature and as E alleged, the respondent no.4 having passed orders in colourable exercise of power favouring himself and certain contractors, require investigation - Central Bureau of . Investigation (CBI) directed to have preliminary enquiry and in case the allegations are found having some substance F warranting further proceeding with criminal prosecution, it may proceed in accordance with law - U. P. Industrial Area Development Act, 1976 - ss.6(2)(b) & 6(2)(c), 8, 9, 12, 14, 17, 18, 19 - U. P. Urban Planning and Development Act, 1973 - ss. 30, 32, 40 to 47, 49, 50, 51, 53 and 58 - New Okhla G Industrial Development Area (Preparation and Finalisation of Plan) Regulations 1991. Code of Criminal Procedure, 1973 - ss.468-471 and 473 - Delay in launching criminal prosecution - Held: Cannot 25 H 26 SUPREME COURT REPORTS [2011] 8 S.C.R. A B itself be a ground for dismissing the complaint, but may be a circumstance to be taken into consideration in arriving at a final decision - More so, the issue of limitation has to be examined in the light of the gravity of the charge. Service Law - Disciplinary proceedings against retired /AS officer - Maintainability of - Held: On facts, the disciplinary proceedings were time barred - All India Services (Death-cum-Retirement Benefits) Rules, 1958·- Rule 6(b). C a democratic society - Rule of Law - Held: The Rule of Law is the foundation of It prohibits arbitrary action and commands the authority concerned to act in accordance with law. Public Authority - Obligation of the State or its o instrumentality - Public Trust Doctrine -Held: Action of the State or its instrumentality must be in conformity with some principle which meets the test of reason and relevance - In essence, the action/order of the State or State· instrumentality would stand vitiated if it lacks bona tides, as it would only be E a case of co/ourable exercise of power - The power vested by the State in a Public Authority ·should be viewed as a trust coupled with duty to be exercised in larger public and social interest - An Authority is under a legal obligation to exercise the power rea$onab/y and in good faith to effectuate the F purpose for which power stood conferred - In this context, "in It must be good faith" means "for legitimate reasons" - exercised bona fide for the purpose and for none other - Doctrines/Principles - Principle of legitimate expectation - Constitution of India, 1950 - Articles 14 and 21. G Doctrines/Principles - Principle of "quando aliquid prohibetur, prohibetur at omne per quod devenitur ad il/ud" - Meaning of - Held: Whatever is prohibited by law to be done, cannot legally be effected by an indirect and circuitous contrivance. H • NOIDA ENTREPRENEURS ASSOCIATION v. NOIDA & 27 ORS. Administrative Law - Act done in undue haste - Effect A of - Held: In case an authority proceeds in undue haste, the Court may draw an adverse inference from such conduct. Respondent no.4 was the CEO, New Okhla Industrial Development Authority (NOIDA) in 1993-94. It was alleged 8 that during this period he committed three acts of misconduct - 1) that he allotted contracts worth Rs.10 crores to different contractors on selection basis without inviting tenders; 2) that he caused financial loss to NOIDA by not paying conversion charges with respect to the C plot allotted to him and 3) that at his instance, a 13 hectare City Park situated in NOIDA was destroyed and· by changing the land use, a new residential Sector in violation of the Master Plan was carved out comprising of 200 plots. D In the instant writ petition, this Court was required to examine as to 1) whether any action was warranted against respondent no.4 and if so, whether it was permissible to initiate disciplinary proceedings against him although in the meanwhile he had reached the age E of superannuation and had retired, and as to 2) whether the misconduct was of such a grave nature that it warranted criminal prosecution and if so, what should be the agency which may be entrusted with the investigation and prosecution. F Disposing of the writ petitions, the Court HELD:1 ~ The services of respondent no.4 stood governed by All India Services (Death-cum-Retirement Benefits) Rules, 1958. Rule 6(b), thereof, provides that in G case the delinquent had already retired, the proceedings shall not be instituted against him without the sanction of the Central Government and shall be in respect of an event which took place not more than four years before the institution of such proceedings. Thus, it is evident that H • 28 SUPREME COURT REPORTS (2011] 8 S.C.R. A law does not permit holding disciplinary proceedings against respondent no.4 at this belated stage. [Para 15) [42-G-H;] B.J. She/at v. State of Gujarat & Ors. AIR 1978 SC 1109: 8 1978 (3) SCR 553; State Bank of India v. A.N. Gupta & Ors. (1997) a sec so: 1997 (4) Suppl. SCR 383; State of U.P. & Ors. v. Harihar Bho/enath (2006) 13 SCC 460: 2006 (8) Suppl. SCR 241; UCO Bank & Anr. v. Rajinder Lal Capoor AIR 2007 SC 2129: 2007 (7) SCR 543; Ramesh Chandra C Sharma v. Punjab National Bank & Anr. (2007) 9 SCC 15: 2007 (7) SCR 585 and UCO Bank & Anr. v. Rajinder Lal Capoor AIR 2008 SC 1831: 2008 (5) SCR 775 - relied on. E

#2. So far as the initiation of criminal proceedings is concerned it is governed by the provisions of Code of D CrifJltrfal Procedure, 1973. Section 468 thereof puts an embargo on the court to take cognizance of an offence after expiry of limitation provided therein. However, there · is no limitation prescribed for an offence punishable with more than 3 years imprisonment. Section 469 declares as to when the period of limitation would start. Sections 470- .471 provide for exclusion of period of limitation in certain · cases. Section 473 enables the court to condone the delay provided the court is satisfied with the explanation furnished by the prosecution or where the interest of justice demands extension of the period of limitation. It is evident that question of delay in launching criminal prosecution may be a circumstance to be taken into consideration in arriving at a final decision, but it cannot itself be a ground for dismissing the complaint. More so, the issue of limitation has to be examined in the light of the gravity of the charge. [Paras 16, 18) [43-C-E; 44-B-C] F G