Decided on June 05,2020

A.G.Chandrasekar Appellant
STATE Respondents


M.Nirmal Kumar, J. - (1.) This petition has been filed by the petitioner to quash the criminal proceedings in C.C.No.91 of 2011 on the file of the Special Court for the cases under Prevention of Corruption Act, 1988, Chennai.
(2.) The facts of the case are briefly stated hereunder:- (i)All the accused persons viz., A1 to A19 entered into a criminal conspiracy to do an illegal act viz., (i) to enter into an agreement on buy back arrangement with TANFED by M/s Maxwell Exim Limited, one of the M.V.R.Group of Companies, to procure the imported inferior quality of raw cashew nuts belonging of M.V.R.Group of Companies which were lying unsold in Tuticorin port, by dishonestly disposing of the funds of TANFED in violation of by-laws, Government Order, Registrar's Circular, unusual purchase procedures and provisions of Tamilnadu Co-operative Societies Rules, 1988 and with no intention to lift the procured raw cashew nut and to cause wrongful loss to TANFED, (ii) to commit criminal misconduct by abusing their position as public servants and obtaining pecuniary advantage to M.V.R.Group of Companies without any public interest, (iii) to make false documents/entries in the records of the said three C0-operative Marketing Societies, TANFED, Tuticorin and Tamilnadu Warehousing Corporation, Tuticorin Port and to cover up the fraud and to use the same as genuine document and to falsify the relevant accounts, such as Sales Invoices, Purchase Bills, Stock Register, Purchase Register, Inward Register, Warehouse Receipts, etc. and (iv) to abet each other in the commission of above said offences. (ii)In pursuance of the conspiracy, the agreement dated 10.01.1996 was prepared by A1, A3, A7 and A8 for procurement of raw cashew nut under buy back arrangement for Rs.10 crores and was executed by A4/the petitioner herein in contravention of the by-laws which stipulates that the procurement should be made from affiliated societies and their members only to the best advantage, Government Order Ms.No.325, Co-operation Food and Consumer Protection Department dated 15.04.1993, which says that prior approval of government is necessary for the contracts exceeding Rs.1 crore and the instructions given in letter Rc.No.43310/95 I P3 dated 17.03.1995 of Registrar of Co-operative Societies which says that where the value of purchase exceeds Rs.10 lakhs, a committee is to be appointed to assist the Special Officer, with a view to obtain pecuniary advantage to M/s.Maxwell Exim Limited. (iii)Further, without waiting for the compliance of the liftment schedule dated 18.03.1996 given by A19 to TANFED, the TANFED officials viz., A2, A3, A4, A7 and A8 approved the draft second agreement on 22.03.1996 for further coverage of 1200 M.Tonnes of raw cashew nuts to the value of Rs.4.60 crore at the rate of Rs.38.20 per k.g. On the very same day, the original agreement and indemnity bond were signed by the petitioner/A4 on behalf of TANFED and A8 as witness on behalf of TANFED and A19 on behalf of M/s.Maxwell Exim Limited which would come into effect from 22.03.1996 and be in force upto 31.05.1996. Neither A2 who took charge as Special Officer, TANFED on 05.03.1996 nor A3, A4, A7 and A8 obtained prior approval from the Government as per G.O.Ms.No.325, Co-operation, Food and Consumer Protection Department, dated 15.04.1993 for the procurement of cashew nut to the tune of Rs.4.60 crore. As the value of contract exceeded more than Rs.1 crore, prior approval from government is necessary as stated above. They did not insist the production of quality certificate though samples which were taken by M/s.S.G.S.India Limited, the authorised company under the said agreement for taking samples for quality and weight. However, A1 to 4, A7 and A8 released the funds to Regional Office, Tuticorin without getting the purchase details from M/s.Maxwell Exim Limited as per the terms and conditions of the said two agreements. (iv)In furtherance of the above said criminal conspiracy and in the course of the same transaction at the same time and place, the petitioner/A4, being the public servant in his capacity as Secretary, Tamilnadu Co-operative Marketing Federation Limited, Chennai abetted A1 in the commission of criminal breach of trust by signing the agreement representing TANFED for the procurement of raw cashew nut to the value of Rs.10 crores for M/s.Maxwell Exim Ltd. on buy back arrangement in contravention of by-laws, Government Order, Registrar's instruction usual purchase procedure etc. and issued cheques even before the receipt of purchase details from M/s.Maxwell Exim Ltd. for production of quality certificate. He further abetted A2 in the commission of criminal breach of trust by approving the office note and draft agreement for further procurement of raw cashew nut of 2000 M.Tonnes to the value of Rs.4.60 crore by signing the original agreement dated 22.03.1996 on behalf of TANFED in contravention of bylaws, Government Order, Registrar's instruction, usual purchase procedure etc. He also signed the said agreement even before the lifting of the raw cashew nut by M/s.Maxwell Exim Ltd for production of quality certificate and issued cheques even before the receipt of purchase details from M/s.Maxwell Exim Limited as per the terms and conditions of agreement and has not insisted the M/s.Maxwell Exim Ltd. to deposit the security deposit at the rate of 7.5% for total purchase of Rs.3.03 crore as per second agreement. (v)Accordingly, in furtherance of the above said criminal conspiracy and in the course of the same transaction, A1 to A4 abused their official position as public servants by entering into agreements dated 10.01.1996 and 22.03.1996 with M/s.Maxwell Exim Limited in procuring imported and inferior quality of raw cashew nut at an exorbitant rate in contravention of the by laws, Government Order, Registrar's Instruction, usual purchase procedure and terms and conditions of agreements and obtained pecuniary advantage for M/s.Maxwell Exim Limited, M/s.Anderson Industries International Limited and M/s.Enkay Foods Limited of M.V.R.Group of Companies to the tune of Rs.10.88 crore without any public interest and thereby, A4 committed the offence under Sections 120-B r/w 409, 409 r/w 109 IPC and Section 13(2) r/w 13(1)(d) of Prevention of Corruption Act, 1988. On completion of investigation in Crime No.1 of 1998, charge sheet came to be filed in C.C.No.1 of 2000 before the VI Additional Sessions Judge, Chennai. Thereafter, on formation of Special Court for cases under the Prevention of Corruption Act, the case in C.C.No.1 of 2000 has been transferred to the file of the Special Court for cases under the Prevention of Corruption Act, Chennai as C.C.No.91 of 2011.
(3.) The learned counsel appearing for the petitioner submitted that the main charge alleged against the petitioner is that he is the signatory to the agreement which has resulted in causing loss to the TANFED Limited. According to the prosecution, he has mainly failed to insist and obtain quality certificate of the raw cashew nut as well as to insist upon the Security Deposit from the accused company. He further submitted that the entire process of entering into the contract for the supply and purchase of raw cashew nut from the accused company were all taken as policy decision by way of proceedings involving higher officials than the petitioner herein. In fact, the Special Officer of TANFED, under whom the entire proceedings had taken place is by and large deciding authority on the various policy decisions taken on behalf of the Government. The petitioner is a far less ranked subordinate than the principal decision maker i.e. the Special Officer/The Board of Committee for taking policy decision who in turn is aided by his immediate subordinates, who are five in numbers viz. General Manager-Marketing, General Manager-Fertilizer, General Manager-Accounts, General Manager-Seeds and Pesticides and General Manager-Engineering, who in turn are all higher in rank than the petitioner herein. Thus, all the decisions taken by the Special Officer/Board of Committee of TANFED are to be strictly adhered to by the subordinate officers working therein.;

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