HIMACHAL PRADESH CRICKET ASSOCIATION & Anr. v. STATE OF HIMACHAL PRADESH & Ors.

Fedration v. B. Narasimha Reddy & Ors. (2011) 9 SCC 286 : [2011] 14 SCR 1; State of Himachal Pradesh v. Nishant Sareen (2010) 14 SCC 527 : [2010] 13 SCR 1200; Ujjam Bai v. State of U.P. [1963] 1 SCR 778; Naresh Shridhar Mirajkar & Ors. v. State of Maharashtra & Anr. AIR 1967 SC 1 : [1966] SCR 744; Northern Corporation v. Union of India & Ors. (1990) 4 SCC 239 : [1990] 3 SCR 621 – referred to. Case Law Reference [1991] 2 SCR 1 (2003) 263 ITR 345 (2012) 344 ITR 544 [1997] 1 SCR 490 [1991] 3 SCR 936 [2008] 9 SCR 943 [2012] 10 SCR 1079 [2003] 2 SCR 436 referred to referred to referred to referred to referred to referred to referred to referred to [1990] 3 Suppl. SCR 259 relied on [2017] 6 SCR 922 [2013] 14 SCR 713 relied on referred to [2006] 3 Suppl. SCR 704 relied on [2004] 3 Suppl. SCR 147 referred to [2013] 14 SCR 213 [2011] 11 SCR 1094 [2011] 14 SCR 1 [2010] 13 SCR 1200 [1963] 1 SCR 778 [1966] SCR 744 [1990] 3 SCR 621 referred to referred to referred to referred to referred to referred to referred to Para 11 Para 14 Para 14 Para 17 Para 21 Para 21 Para 22 Para 22 Para 23 Para 23 Para 26 Para 27 Para 28 Para 28 Para 28 Para 28 Para 28 Para 31 Para 31 Para 31 A B C D E F G H 874 SUPREME COURT REPORTS [2018] 13 S.C.R. A CRIMINAL APPELLATE JURISDICTION: Criminal Appeal Nos. 1258-1259 of 2018 From the Judgment and Order dated 25.04.2014 of the High Court of Himachal Pradesh at Shimla in Cr. MMO. No. 6 of 2014. W.P. (Crl.) No. 135 of 2017. With Ashok Sharma, Adv. Gen., P. S. Patwalia, Anoop George Chaudhary, Mrs. June Chaudhari, Sr. Advs., Mrs. Bihu Sharma, Ms. Purnima Krishna, Snehasish Mukherjee, Manish Kumar, Akshay Amritanshu, Ajay Marwah, Parmatma Singh, D. K. Thakur, Shariq Ahmed, Kunal Verma, Varinder Kumar Sharma, Advs. for the appearing parties. The Judgment of the Court was delivered by A. K. SIKRI, J. 1. Two FIRs are the subject matter of these appeals. One FIR No. 12 of 2013 dated August 01, 2013 is under Sections 406, 420, 120B of the Indian Penal Code, 1860 (IPC) and Section 13(2) of the Prevention of Corruption Act, 1988 (PC Act) has been registered against the appellants herein as well as some other persons. Second FIR No.14 of 2013 dated October 03, 2013 is under Section 447 read with Section 120B of the IPC, Section 3 of Prevention of Damage to Public Property Act, 1984 and Section 13(2) of the PC Act. The appellants filed petitions under Section 482 of the Code of Criminal Procedure, 1973 (Cr.P.C.) before the High Court of Himachal Pradesh for quashing of the said FIRs. These petitions have been dismissed by the High Court vide common judgment dated April 25, 2014. That judgment is impugned in the instant appeals. When the Special Leave Petitions (out of which these appeals arise) were filed, notice thereof was issued on January 5, 2015 and stay of further proceedings was also granted in the case arising out of the said FIRs which are pending before the Special Judge, Kangra, Dharamshala, Himachal Pradesh. That stay has been extended from time to time and is, therefore, continuing.

#2. During the pendency of these proceedings, investigation was completed. On the day judgment was pronounced by the High Court, the chargesheets were filed in the Court of Special Judge. After the filing of the said chargesheets, the appellants have also filed Writ Petition B C D E F G H HIMACHAL PRADESH CRICKET ASSOCIATION v. STATE OF HIMACHAL PRADESH [A. K. SIKRI, J.] 875 (Criminal) No. 135 of 2017 in this Court seeking quashing of these chargesheets. Both these proceedings were clubbed and heard together which we propose to dispose of by this common judgment.

#3. Appellant No. 1 is a Cricket Association of Himachal Pradesh which was initially registered as a Society under the Societies Registration Act, 1860 vide Registration Certificate dated June 08, 1990. On September 15, 2001, appellant No. 1 made an application for allotment of land to develop and construct the world class cricket stadium and consequently, the Commissioner-cum-Secretary (Education) granted permission for transfer of land to the Himachal Pradesh Youth Services and Sports Department with certain conditions. A lease deed dated July 29, 2002 was executed between appellant No.1 and respondent No. 1 through Director, Himachal Pradesh Youth Services and Sports Department for the said land at Village Mouja and Tehsil Dharamshala, District Kangra for construction of an international cricket stadium which was duly constructed. On July 14, 2005, a not for profit company in the name of Himalayan Players Cricket Association was incorporated under Section 25 of the Companies Act, 1956. Name of this company was changed to Himachal Pradesh Cricket Association on August 31, 2005.

#4. Purusant to a proposal to host international cricket matches at Dharamshala, the International Cricket Council inspected the cricket infrastructure being developed at Dharmashala by appellant No. 1 and, inter alia, observed that the quality of accommodation left much to be desired. Need for some more facilities and hotel accommodation of desired quality was specifically stressed.

#5. Having regard to this report, the appellants decided to construct a club house on the leased land. There was also a parcel of idle land in the middle of the land allotted for the stadium. Appellant No.1 towards this end made a request to the Director, Youth Services and Sports for allotment of additional land adjacent to the stadium admeasuring 720 square metres, vide its letter dated July 03, 2008. Since it was Gram Panchayat land, consent thereof was also needed for its allotment to the appellant No.1. Appellant No.1, thus, approached the Gram Panchayat. Pursuant to meetings between the office bearers of appellant No. 1 and Gram Panchayat, members of Uparali Dhari Development Division, Dharamshala, the said Gram Panchayat issued no objection for allotment of the land. Proposal of appellant No. 1 for allotment of additional land A B C D E F G H 876 SUPREME COURT REPORTS [2018] 13 S.C.R. was mooted with the authorities as well. Respondent No. 1 vide letter dated November 16, 2009 took up the matter with the ACS-cum-FC Revenue to the Government of Himachal Pradesh for approval to lease out government land in Mohal Kand Mauja Khanyara, Tehsil Dharamshala, District Kangra, measuring in 3-28-06 hectare in favour of appellant No. 1. Respondent No. 1 granted approval to lease out the aforesaid land in favour of appellant No. 1 vide letter dated November 16, 2009 which was conveyed vide letter dated November 18, 2009. As a result, lease deed was executed between appellant No. 1 and respondent No. 1 for lease of the said land situated at Mohal Kand Mauza Khanyara, Tehsil Dharmashala.

#6. Club house was constructed at the stadium premises at Dharamshala under the name and style of “Aveda HPCA Club House”. Completion Certificate was issued on March 10, 2011 and was certified complete in all aspects as per approved plan of the Executive Officer, Municipal Council, Dharamshala. The Town and Country Planning Department, Dharamshala also issued no objection certificate dated March 15, 2011 for use of part of the infrastructure of cricket stadium as club house for cricket activities. Respondent No. 1 also approved the tariff for availing the accommodation facilities of the club house vide its letter dated September 08, 2011.

#7. The Board of Control for Cricket in India (BCCI) granted permission to the Himachal Pradesh Cricket Association to convert itself from a “not for profit” society to a “not for profit” company during its annual general meeting held on September 19, 2011. A majority of cricket associations throughout the country have been converting themselves from a not for profit society to a not for profit company registered under the Companies Act, 1956 in order to ensure better and transparent management of their affairs. Realising that unless world class accomodation was available for the teams playing at the stadium and the officials concerned accompanying such teams, the venue at Dharamshala that was being painstakingly developed by the appellant No. 1 from its own funds would be grossly underutilised and the State would lose out in hosting cricket matches, appellant No. 1 and its office bearers began working out a method to construct a world class motel for such purposes. A B C D E F G H HIMACHAL PRADESH CRICKET ASSOCIATION v. STATE OF HIMACHAL PRADESH [A. K. SIKRI, J.] 877 Appellant No. 1 realized that if the use of the same was restricted only to usage during match days for use of teams and their officials, the same would not be commercially viable. As the terms of the lease may not be technically wide enough to cover this allied infrastructure being developed for the game of cricket, vide its letter dated December 24, 2011, appellant No. 1 wrote to the respondent to request it to permit commercial activity on the said land on even non match days and amend the lease terms accordingly. The above letter was forwarded by the District Magistrate to the Principal Secretary (Revenue), Government of Himachal Pradesh and the Principal Secretary (Revenue), Government of Himachal Pradesh issued no objection for execution of a supplementary lease enabling commercial activity on the additional land at Kandi provided that the lease money was charged in accordance with the Lease Rules, 2011. A supplementary lease deed was executed between the appellant No.1 and the State of Himachal Pradesh enabling use of the additional land commercially. Necessary permissions for development on the said land were obtained including for commercial hotel. The hotel constructed under the name and style of “The Pavilion” obtained registration with the Tourism Department of the State and Tariffs, etc. were also fixed by the said Department on September 26, 2012. In the meantime, on September 22, 2012 resolution was passed by the appellant No. 1 company to take over the assets and liabilities of the society. Agreement dated October 01, 2012 was also executed between the Himachal Pradesh Cricket Association (the society) and Himachal Pradesh Cricket Association (the Company) to enable the Society to convert itself into a Company. Accordingly, the Society was converted into a Company and the Himachal Pradesh Cricket Association stood converted from a society to a not for profit company registered under the Companies Act, 1956 and the Registrar of Companies was informed of the same in due course.

#8. Within a couple of months, from the aforesaid developments, there was a change of political executive in the State of Himachal Pradesh pursuant to the elections of legislative assembly. According to the appellants, with the change of political power, tirade against the appellants started by the new Government. In fact, even during the election campaign, the Congress (I) had published a ‘Congress Chargesheet’ wherein serious allegations were levelled against the appellants. The appellants department sprung into action and started seeking information A B C D E F G H 878 SUPREME COURT REPORTS [2018] 13 S.C.R. from the appellants on various aspects, though this information was already available with the State Government. A formal FIR No. 12 of 2013 dated August 01, 2013 was registered which, according to the appellants, is the result of the said ‘Congress Chargesheet’. In fact, some time before that, a complaint under Section 156(3) Cr.P.C. was made by one Vinay Sharma against appellant No. 1 and its office bearers in which orders were passed by Special Judge, Kangra on July 02, 2013 directing the police authorities to investigate the said case and submit the report to it. Thus, two parallel proceedings were started.

#9. Further allegation of the appellants is that investigation was personally monitored by respondent No. 2 herein who was the Chief Minister at that time. He had also made various public statements from time to time that he was interested in taking over the entire function of the Cricket Association and its assets. According to the appellants, at the behest of respondent No. 2, even the Registrar of Societies, Himachal Pradesh issued notice dated September 7, 2013 on the issue of formation of company under Section 25 of the Companies Act, 1956 and taking over the assets of the society. Against this notice, Writ Petition No. 7593 of 2013 was filed wherein the High Court passed the orders keeping in abeyance the allegations raised in the notice dated September 7, 2013 of the Registrar of Societies.

#10. Another FIR No. 14 of 2013 dated October 03, 2013 came to be registered against the appellants and others alleging commission of offences under Section 447 read with Section 120B of the IPC, Section 3 of the Prevention of Damage to Public Property Act, 1984 and Section 13(2) of the PC Act. Many other actions were taken by the respondents, which according to the appellants, were mala fide moves, reference whereto shall be made at the appropriate stage. At this juncture, the appellants filed petition under Section 482 of Cr.P.C. on January 06, 2014 seeking quashing of FIR No. 12 of 2013 which stands dismissed vide impugned judgment dated April 25, 2014.

#11. The High Court in the impugned judgment has taken note of catena of judgments of this Court pertaining to powers of the High Court within the scope of Section 482 of Cr.P.C. Thereafter, it has observed that after lodging of the FIR, investigation has been conducted and the material collected during investigation discloses that 18 persons made accused in the aforesaid FIR are prima facie involved in the commission A B C D E F G H HIMACHAL PRADESH CRICKET ASSOCIATION v. STATE OF HIMACHAL PRADESH [A. K. SIKRI, J.] 879 of offences. On this ground, it has brushed aside the argument of the appellants that it was a case of vengeance, political vendeta and mala fide. The High Court has also observed that allegations of mala fide based on the facts after lodging of the FIR are of no consequence and cannot be the basis for quashing the proceedings. For this purpose, it has referred to the judgment of this Court in State of Bihar & Anr. v. P.P. Sharma & Anr.1. It has also observed that even otherwise, the file does not disclose at this stage how it is the case of mala fide. In the opinion of the High Court, in such circumstances, merits of the case is to be tested during trial inasmuch as FIR and Final Report of Investigating Agency discloses that case for trial is made out. As the power under Section 482 Cr.P.C. is to be exercised carefully, cautiously and in rarest of rare cases, keeping in mind the law laid down by this Court, the High Court refused to quash the proceedings. We may also record here that one of the submissions of the appellants before the High Court was that appellant No. 2 and other persons are not public servants and, therefore, provisions of PC Act could not be invoked against them. This argument has also been found to be unmerited on the ground that some of the accused persons arrayed with the appellants are public servants and also that allegation in the FIR is that all these accused persons has the conspiracy and wrongful gain to themselves and wrongful loss to the State, in the process, the officials misused their position to show favour to other accused persons.

#12. Mr. Patwalia, learned senior counsel appearing for the appellants, at the outset, drew the attention of this Court to the fact that M/s. Subhash Ahluwalia, Subhash Negi, Ajay Sharma, Deepak Sanan and T.G. Negi, who are the IAS Officers, were associated with the grant of three leases. They were the main persons who took active part in deciding that the three leases should be granted to the appellants and on that basis, final decision was taken. However, as far as these Officers are concerned, prosecution sanction has either been denied or they have not been prosecuted at all. Likewise, Mr. Gopal Chand, who belongs to Himachal Pradesh Administrative Service, was arrayed as one of the accused person, but in his case also, the sanction though given earlier stood withdrawn. He has even been promoted to IAS cader. Mr. Patwalia submitted in tabular form status of Officers who have allegedly conspired with the appellants, which is as under: 1 1992 Supp (1) SCC 222 A B C D E F G H 880 SUPREME COURT REPORTS [2018] 13 S.C.R. Sl. No. Name Officer Post time of alleged offence Role as per FIR Sanction FIR No. 12 of 2013 dated 01.08.2013 under Sections 406/420/120B IPC and Section 13(2), Prevention of Corruption Act 1 Subhash Ahluwalia IAS, Director- cum-Special Secretary, Youth Services Sports Department, Government of Himachal Pradesh. Not Charged (Not enough evidence malafide intention ). Subhash Sh. Ahluwalia, grant of lease Government Land to HPCA construction of Cricket Stadium ignored rules and had not mentioned the provisions of Lease Rules, 1993 in his noting. Further, Subhash Ahluwalia was a signatory the Lease Deed 29.07.2002. Sh. A B C D E F G H HIMACHAL PRADESH CRICKET ASSOCIATION v. STATE OF HIMACHAL PRADESH [A. K. SIKRI, J.] 881 2 Subhash Negi IAS, Secretary, Youth Services Sports Department, Government of Himachal Pradesh 3 T.G. Negi IAS, Principal Secretary, Youth Services Sports Department, Government of Himachal Pradesh. Not Charged (Not enough evidence of malafide intention). Not Charged (Not enough evidence of malafide intention). Subhash Sh. Negi, time of grant of Government Land to HPCA construction of Cricket Stadium ignored rules and had not mentioned the provisions of Lease Rules 1993 noting. Sh. T.G. Negi made no efforts reject notings Sh. accused Sharma Ajay instead forwarded approval of the Chief Minister. 4 Ajay Sharma IAS, Director- cum-Special Secretary, Youth Services In 2008, Chief Minister P.K. Dhumal marked the Prosecution sanction declined by Central A B C D E F G H 882 SUPREME COURT REPORTS [2018] 13 S.C.R. A B C D E F G H Sports Department, Government of Himachal Pradesh. Government 25.08.2015. Prosecution sanction withdrawn by State Government 09.04.2018. application of HPCA for permission of construction of Club House commercial use to Sh. Ajay Sharma and asked him to prepare the proposal for the same. Sh. Ajay Sharma, by abusing his official position proposed permission HPCA with approval Chief Minister. The land was leased only for construction of cricket stadium and not club house. Sh. Ajay Sharma, by abusing his office in criminal conspiracy HPCA, contrary to the terms and conditions of the provided benefit to the HPCA and loss to the State Government. HIMACHAL PRADESH CRICKET ASSOCIATION v. STATE OF HIMACHAL PRADESH [A. K. SIKRI, J.] 883 5 Deepak Sanan IAS, Princi pal Secretary- cum-Financial Commissioner , Revenue Department, Government of Himachal Pradesh. Prosecuti on sanction declined by Central Government 25.08.2015. Prosecuti on sanction withdrawn by the State Government 09.04.2018. Sh. Deepak Sanan issued NOC commercial use of Government land which was leased to HPCA construct ion of Hotel Pavilion by reversing the earlier decision of C ouncil of Sh. Minister. Deepak Sanan also notified the Rules, Lease 2011, on basis of which supplementary executed, accordance with Rule 9. 6 Gopal Chand HP AS , Addi tional Secretary, Revenue Department, Government of Himachal Pradesh Gopal Sh. C hand recommended commercial use of land leased to HPCA Mohal Kand and marked the Sh. Deepak Sanan, Prosecuti on sanction granted 03.04.2014 withdrawn by the State Government 03.08.2016. Promoted t o IAS. A B C D E F G H 884 SUPREME COURT REPORTS [2018] 13 S.C.R. whereas under Schedule 20 of the Business Rules, recommended the matter to be taken to the Cabinet. FIR No. 14 of 2013 dated 03.10.2013 under Sections 447/120B IPC, Section 3 of the Prevention of Damage to Public Property Act, 1984 and Section 13(2) of the Prevention of Corruption Act 7 K.K. Pant IAS, Deputy Commissioner, Kangra, Himachal Pradesh Prosecution sanction declined Central Government 27.03.2015. On 14.03.2008, Sh. K.K. Pant a chaired meeting accused, without following procedure without having statutory power for doing so, reallocation Type IV, UGC accommodation in the possession of the Education Department and A B C D E F G H HIMACHAL PRADESH CRICKET ASSOCIATION v. STATE OF HIMACHAL PRADESH [A. K. SIKRI, J.] 885 8 P.C. Dhiman IAS, Principal Secretary, Education Department, Government of Himachal Pradesh the presumptions meeting made with intention to give undue advantage to HPCA. Sh. Pant K.K. overlooked regarding report condition building. Sh. P.C. Dhiman issued NOC the Department of Youth Services Sports, contrary recommendations / conditions of the Director, Higher Education, without mentioning disposal building accordance with rules/norms and recovery from HPCA. Prosecution sanction declined by Central Government 24.08.2015. A B C D E F G H 886 SUPREME COURT REPORTS [2018] 13 S.C.R. Prosecution sanction decli ned Department Secretary but recommended Chief Minister Sh. Virbhadra Singh. Hence, prosecution sanction granted 23.09.2014 15.10.2014 (FIR 03.10.2013) No. A 9 Devi Chand Chauhan B C D E F G H Executive Engineer, Dharamshala Division, HPPWD Devi Chand Chauhan, while working Executive Engineer (Civil), Dharamshala, HPPWD Division forwarded report sent by the then SDO Sub- Division No. 1, Dharamshala, regarding dilapidated condition Type IV accommodations, without following procedure as laid Government India, Central Public Works Department Code, whihc led illegal demolition storied building (Type IV accommodation) of the Education Department HIMACHAL PRADESH CRICKET ASSOCIATION v. STATE OF HIMACHAL PRADESH [A. K. SIKRI, J.] 887 existing adjacent to the present Cricket Stadium gate, which was an eyesore to the HPCA and alleged to be a security threat to the players. Thus, the motive of the Executive Engineer was to intentionally give an advantage to HPCA thereby misusing his official position.

#13. Thus, the Government Officers who have granted lease are not been prosecuted. He, thus, submitted that the main Government functionaries were left out which shows that the Government wanted to protect its own Officers but, at the same time, roped in the appellants and others because of political enmity.

#14. Dilating on the aforesaid plea, namely, the entire prosecution is due to political vendetta, without any legal basis, Mr. Patwalia submitted that the genesis of the prosecution starts with the failed attempt by the then State Government to take over appellant No. 1 in the year 2005 under the provisions of the HP Sports (Registration, Recognition and Regulation of Associations) Act, 2005 due to the interim protection granted by the Himachal Pradesh High Court on May 18, 2005. This A B C D E F G H 888 SUPREME COURT REPORTS [2018] 13 S.C.R. Act was subsequently repealed. According to him, in view of the repeated interference by State Governments in the internal affairs of autonomous cricket associations, the BCCI has informally encouraged such member associations to re-register themselves as not for profit charitable Section 25 Companies under the Companies Act, 1956, as amended, for better legal compliances, transparency and to avoid interference in internal affairs by State Governments. Accordingly, various member associations of the BCCI have converted themselves to Section 25 not for profit charitable companies governed by the provisions of the Companies Act, 1956. Appellant No. 1 also followed the suit as a result of aforesaid mandate of the BCCI. Accordingly, a not for profit company in the name of Himalayan Players Cricket Association was incorporated under Section 25 of the Companies Act, 1956. On August 31, 2005, the said Company was permitted to change its name to Himachal Pradesh Cricket Association and was issued a fresh certificate of incorporation. During this process, the HP Sports (Registration, Recognition and Regulation of Associations) Act, 2005 stood repealed and no further steps were taken in the interregnum to convert the society to a section 25 company. Thereafter, on September 19, 2011, the BCCI took up the pending request of appellant No. 1 to permit it to convert itself to a Section 25 not for profit company and granted the same. Pursuant to the permission by the BCCI, amendments were carried out by the members at the AGM of the appellant No. 1 on September 22, 2012 resolving to convert the appellant No. 1 society to a Section 25 Company. Accordingly, an agreement was executed on October 01, 2012 converting the society to a Section 25 Company and informing the Registrar of Companies of the same. On October 31, 2012, appellant No. 1 now registered as a Section 25 Company under the Companies Act, 1956 informed the Registrar of Societies of the State of Himachal Pradesh of the change in the memorandum and rules of the appellants. Further, on November 02, 2012, once again the intimation regarding change in status of appellant No. 1 from a not for profit society to a not for profit company was given to the Registrar of Societies, State of Himachal Pradesh. Thus, from October 01, 2012, appellant No. 1 has been existing as a Company with due intimation to the State of Himachal Pradesh paying its lease rent and taxes in accordance with law. He also argued that the effect of such statutory conversion from a firm to a company by statutory provisions for income tax purposes has been considered by the Bombay High Court in the case of Commissioner of Income Tax, Mumbai v. A B C D E F G H HIMACHAL PRADESH CRICKET ASSOCIATION v. STATE OF HIMACHAL PRADESH [A. K. SIKRI, J.] 889 Texspin Engg. and Mfg. Works, Mumbai2 and Punjab & Haryana High Court in the case of Commissioner of Income Tax (Central), Ludhiana v. M/s. Rita Mechanical Works, Ludhiana3 wherein it has been held as under: “There is a difference between vesting of the property, in this case, in the limited company and distribution of the property. On vesting in the limited company under Part IX of the Companies Act, the properties vest in the company as they exist. ... “In the present case, we are concerned with a partnership firm being treated as a company under the statutory provisions of Part IX of the Companies Act. In such cases, the company succeeds the firm. Generally, in the case of a transfer of a capital asset, two important ingredients are: existence of a party and a counter-party and, secondly, incoming consideration qua the transferor. In our view, when a firm is treated as a company, the said two conditions are not attracted. There is no conveyance of the property executable in favour of the limited company. It is no doubt true that all properties of the firm vest in the limited company on the firm being treated as a company under Part IX of the Companies Act, but that vesting is not consequent or incidental to a transfer. It is a statutory vesting of properties in the company as the firm is treated as a limited company. On the vesting of all the properties statutorily in the company, the cloak given to the firm is replaced by a different cloak and the same firm is now treated as a company, after a given date. ...”

#15. On the aforesaid basis, submission of Mr. Patwalia was that conversion of a not for profit society to a not for profit charitable company which is expressly permitted by law cannot be construed as a crime. The assets - in the present case leased land remain as they are. In fact, the appellants have constructed a world class stadium and a world class hotel on the leased premises. Importantly, the State Government continues to remain the owner of the land and has the power under the leases to cancel the same for violation of terms and conditions of the lease.

#16. It was highlighted by him that on the midnight of October 26, 2013, the State Government had cancelled the leases and forcibly 2 (2003) 263 ITR 345 3 (2012) 344 ITR 544 A B C D E F G H 890 SUPREME COURT REPORTS [2018] 13 S.C.R. dispossessed the appellants from the leased lands. However, on November 05, 2013, the Himachal Pradesh High Court strictured the State Government and ordered status quo ante and handed over the possession of the leased lands to the appellants. The State Government thereafter accepted this order and withdrew the cancellation of lease notices on November 19, 2013. Subsequently, another notice dated May 23, 2015 was issued seeking cancellation of the leases which too stands withdrawn on August 09, 2018. At present, there are no proceedings pending for cancellation of the leases.

#17. Mr. Patwalia argued that there were specific allegations of mala fide against respondent No. 2 from the very inception of these proceedings about how he first caused the FIR to be registered and thereafter interfered in the investigations, by being head of the SIT. He also further stated that the conduct of respondent No.2 from opposing the present appeals after having filed a counter affidavit in the present matter stating that he was not a necessary party and it was not his job to defend the prosecution, depicts mala fides on his part. This, according to him, was sufficient to quash the FIR as investigation was tainted. In support, he referred to the case of Union of India & Ors. v. Sushil Kumar Modi & Ors.4 wherein this Court held as under: “4. ...The agencies concerned must bear in mind and, if needed, be reminded of the caution administered by Lord Denning in this behalf in R. v. Metropolitan Police Commr. [(1968) 1 All ER 763 : (1968) 2 WLR 893 : (1968) 2 QB 118] Indicating the duty of the Commissioner of Police, Lord Denning stated thus: (All ER p. 769) “I have no hesitation, however, in holding that, like every constable in the land, he should be, and is, independent of the executive. He is not subject to the orders of the Secretary of State, …. I hold it to be the duty of the Commissioner of Police, as it is of every chief constable, to enforce the law of the land. He must take steps so to post his men that crimes may be detected; and that honest citizens may go about their affairs in peace. He must decide whether or not suspected persons are to be prosecuted; and, if need be, bring the prosecution or see that it is brought; but in all these things he is not the servant of anyone, save of the 4 (1997) 4 SCC 770 A B C D E F G H HIMACHAL PRADESH CRICKET ASSOCIATION v. STATE OF HIMACHAL PRADESH [A. K. SIKRI, J.] 891 law itself. No Minister of the Crown can tell him that he must, or must not, keep observation on this place or that; or that he must, or must not, prosecute this man or that one. Nor can any police authority tell him so. The responsibility for law enforcement lies on him. He is answerable to the law and to the law alone.” ...There can hardly be any doubt that the obligation of the police in our constitutional scheme is no less.”

#18. Mr. Patwalia referred to various documents placed on record and contended that they would ex facie show that administrative decisions were taken at various levels and by variou departments by the concerned officers prior to sanction of leases in favour of appellant No.1. Therefore, no wrong, much less culpable wrong, was committed by the appellants and others. He specifically referred to the allegation that there is no provision of grant of lease at a token rate of Re.1/- per month under the applicable lease rules. His response was that this argument is completely fallacious. The leases of the appellants were granted under the H.P. Lease Rules, 1993. The appellants wanted to set up a cricket stadium with allied world class infrastructure to enable the ICC to grant international games to Himachal Pradesh and, thus, were eligible for grant of lease under Rule 4(vii) - public purpose in the interest of the development of the State. The appellants were also eligible for grant of larger areas under Rule 5 in terms of the exemption provided therein. In fact, the decision to lease the land at token rate of Re.1/- per month for construction of cricket stadium was a well thought out administrative decision by the State Government in the interest of the State and has admittedly put Dharamshala on the world map. This decision was taken by the State Cabinet after considering the advice and presentation from the officers concerned. RTI documents in the possession of the appellants record the decision of the Cabinet dated May 27, 2002 as under: “Item No. 14 Government of Himachal Pradesh General Administration Department (Confidential & Cabinet) Subject: Leasing out of Government land for the construction of International Cricket Stadium at Dharamshala to H.P. Cricket Association on usual terms and conditions. A B C D E F G H 892 SUPREME COURT REPORTS [2018] 13 S.C.R. A The above proposal was discussed by the Cabinet in its meeting held on 27.5.2002 and the decision arrived at thereon is reproduced below:- “The Cabinet approved the propsoal regarding lease rates. Advantages of the Project explained by the AD were considered and it was decided that land be leased out at token rate of Re.1/- per month for a period of 99 years.” The implementation report of the above decision may please be sent to this Department within a fortnight from the receipt of this communication. Sd/- Addl. Secretary (GAD)” 19. Further, Rule 8 provides for lease amount to be paid. At the time of grant of lease, the appellant being a society had to pay lease amount under Rule 8(1)(ii) at 8% of the latest highest market value of the land leased or double the average market value of five years whichever is less. The proviso to Rule 8(1) empowers the State Government to reduce the lease amount in deserving cases and reads as under: “8(1) Lease Amount. - (1) The lease amount (fresh or renewal of existing lease) shall be charged from the eligible institutions and persons per annum as under:- ...... Provided that the State Government may reduce the amount for special reasons in deserving cases.” Therefore, the State Government took a conscious decision in exercise of its powers under the proviso to Rule 8(1) of the H.P. Lease Rules, 1993 and granted the lease at a token rate of Re.1/- per month.

#20. Based on the aforesaid material and circumstances highlighted by Mr. Patwalia, his submission was that no case was made out against the appellants and others, for prosecuting them under criminal law, much less under the provisions of PC Act and the High Court in its impugned judgment has totally glossed over these aspects by limiting the exercise to copiously quoting various judgments and on that basis, dismissing the petitions of the appellants, without any discussion as to how principles contained in those judgments is applicable in the instant case.

#21. He also submitted that in the facts of the present case, simply because chargesheet has been filed thereafter and the order taking B C D E F G H HIMACHAL PRADESH CRICKET ASSOCIATION v. STATE OF HIMACHAL PRADESH [A. K. SIKRI, J.] 893 cognizance has been passed would not mean that the appellants cannot prosecute these cases. He submitted that even the chargesheet and cognizance order has been challenged by filing Writ Petition (Criminal) No. 135 of 2017 which, according to him, is maintainable having regard to the fact that the appeals arising out of petitions under Section 482 of Cr.P.C. are pending in this Court and those events happened during the pendency of these proceedings. He referred to the the cases of Delhi Judicial Service Association, Tis Hazari Court, Delhi v. State of Gujarat & Ors.5 and Monica Kumar & Anr. v. State of Uttar Pradesh & Ors.6, wherein it is held that this Court has inherent power to quash FIR, chargesheet, charges etc. in exercise of powers under Articles 32, 136 and 142 to do complete justice in a cause or matter pending before it and that there is no restriction on this power of the Court. According to him, the present is not a case where the appellants are alleging that a judicial order is in violation of their fundamental rights. The present is a case where the appellants have pleaded that: A B C (i) there is no criminal act on their part and the facts do not disclose any offence; D (ii) all Officers who processed the case of the appellants are not prosecuted; (iii) two Officers Subhash Ahluwalia and T.G. Negi who processed the case of the appellants were made Principal Secretary to CM and Advisor to CM, respectively, by the respondent No. 2 and were not prosecuted; (iv) there is no criminal act on the part of the officers and they performed their appropriate administrative duties due to which sanction stands declined by the Central Government and the CVC; E F (v) leases were validly granted as per proper procedures and in accordance with lease rules; (vi) FIR was registered on the basis of “Congress Chargesheet”; (vii) investigation was personally supervised by the respondent No. 2; G (viii) chargesheet filed is the outcome of this tainted investigation;