Single-Judge Bench can dispose of petition against judicial order challenging jurisdiction of CBI to proceed with investigation in non-compliance of Sec.17A of PC Act: Bombay HC

Read Judgment: Rana Kapoor vs. Central Bureau of Investigation & Another 

Pankaj Bajpai

Mumbai, December 27, 2021:  While considering a petition seeking a direction that, CBI (Respondents) cannot investigate into the offences registered u/s 7 and 11 of the Prevention of Corruption Act, 1988 (PC Act), without previous approval of the authority competent to remove Rana Kapoor (Petitioner) from his office when the offence was alleged to have been committed, the Bombay High Court has opined that besides the offence u/s 7 & 11 of the PC Act, prosecution for the offences under the IPC and Section 12 of the PC Act would continue even if the petition is allowed. 

The Single Judge Sandeep K. Shinde therefore observed that the outcome of the petition would not result in, quashing of entire FIR as sought by the CBI, but would merely restrain the CBI from conducting its investigation against the Petitioner under the provisions of PC Act, 1988 and not against other Co-Accused persons.

Going by the background of the case, CBI had registered an FIR against Rana Kapoor (Petitioner), the former Managing Director of Yes Bank Limited, on the allegation of having obtained illegal gratification to the tune of Rs. 307 Crores by getting a bungalow in the posh Delhi area of Amrita Shergil Marg at a price almost half the market price of the said property. It was alleged that the said property had belonged to M/s Avantha Realty Ltd, a company of Gautam Thapar and that the said illegal gratification was paid to Rana Kapoor in order to get bank loans to the tune of around Rs. 1900 crores by the abuse of the official position of Rana Kapoor. 

Accordingly, a criminal case was registered against the Petitioner at the instance of CBI for the offences punishable u/s 120B, 420 of IPC and Sections 7, 11 & 12 of the PC Act. Challenging the same, the Petitioner moved an application before the trial Court, seeking directions to the CBI not to proceed in the matter, in non-compliance of Section 17A of the PC Act. The application was however, rejected. Hence, the present petition. 

The counsel for the Petitioner, Vijay Aggarwal, argued that the actions of the CBI to proceed in the investigation in the matter without a valid approval u/s 17A of the PC Act was illegal and hence, liable to be set-aside.

Opposing the same, the counsel appearing for CBI, Advocate Venegavkar, had raised an objection regarding the jurisdiction of a Single Judge to dispose the petition by relying on Bombay High Court Appellate Side Rules, 1960, Part II of Chapter 1, Clause (h) relating to Conduct of Business.

Countering the argument of CBI that the relief to Rana Kapoor would amount to quashing to FIR, Aggarwal argued that there are several cases which provide for matters not proceeding against a particular Accused, but the same does not amount to quashing. 

Mr. Aggarwal further argued that the principles of quashing are different and the word used in the Bombay High Court Appellate Side Rules, 1960 is “quashing” and not setting-aside of a judicial order. 

After considering all submissions, the High Court held that the Single Judge can dispose of the petition as the present challenge u/s 482 of the CrPC is to the judicial order.