Bofors Order-Ottavio Quattrocchi Order

RC No.1(A)/90 (“CBI V/s Ottavio Quattrocchi”) DOD: 04.03.
2011
IN THE COURT OF VINOD YADAV: CHIEF METROPOLITAN MAGISTRATE: DELHI
RC1(A)/90
CBI/ACUIV/SIG/ND (Bofors Case)
CBI V/s Ottavio Quattrocchi
Unique Case ID No.: 02401R6227212004
04.03.2011
O R D E R:
By this order, I shall dispose off application U/s 321 Cr.P.C, filed
by learned Special Public Prosecutor of CBI, Shri U.S Prasad, seeking
withdrawal of the case against accused Mr.Ottavio Quattrocchi (hereinafter
referred to as “Q”). This application was filed on 03.10.2009. Alongwith the
application, a letter dated 28.09.2009 of the Government of India, Ministry of
Personnel, PG & Pensions was also filed, whereby the Central Government
has conveyed its “approval” to the proposal of CBI for moving this court for
obtaining consent to withdraw prosecution against “Q”.
2. This application was opposed by two persons namely Shri Ajay
Kumar Aggarwal, Advocate (hereinafter referred to as “Aggarwal”) and Shri
Siddharth Gupta, Advocate (in the capacity of President of a society namely
“Nirdhan Nishulk Kanooni Sahayata Samiti”) (hereinafter referred to as
“Gupta”).
Order on Application U/s 321 Cr.P.C filed by CBI (“Application Allowed”) Page 1 of 73
RC No.1(A)/90 (“CBI V/s Ottavio Quattrocchi”) DOD: 04.03.2011
3. When the arguments on this application commenced, the learned
Additional Solicitor General of India, Shri P.P Malhotra, raised a preliminary
objection that “Aggarwal” and “Gupta” do not have “locusstandi” to oppose
this application and argued that application U/s 321 Cr.P.C is necessarily
between the Public Prosecutor and the Court. However, in the larger interest
of justice, this court permitted “Aggarwal” and “Gupta” to advance
arguments as “Amicus Curiae”. However, at that stage, it was left open as to
whether they had “locusstandi” to oppose this application or not. I will deal
with this aspect a little later.
4. This case has a chequered history. The facts of the case in brief,
required for the disposal of this application, succinctly stated are as under:
FACTS ABOUT BOFORS CONTROVERSY:
5. The Indian defense purchase policy, till 1984, allowed foreign
bidders to have their Indian gents. However, they were required to furnish
details of their Indian agents, if any, to the Government, in a prescribed
proforma. Subsequently, the Govt. of India in consultation with the Defence
Department, made a uniform policy, prescribing that “agents” were not to be
allowed in Indian defense purchases. If any bidder had maintained one, the
amount so payable to agent by the supplier, was to be reduced from the quoted
deal. The revised policy was to ensure that the deal was on a principal to
principal basis, to avoid undesirable consequences which may arise out of
such arrangement, to save the cost to the defense budget and thus to the public
exchequer.
6. In respect of the Bofors gun deal, at the relevant time, there were
four bidding firms involved in the bidding of the gun deal, namely, M/s Sofma
(France), M/s Bofors (Sweden), M/s International Military Services (Britain)
and M/s Voest Alpine (Germany). These bidders had furnished the
requisite information about their agents in India.
7. M/s Bofors of Sweden also, in its declaration dated May 19,
1984, under the signature of Hans Ekblom, Vide President (Marketing), had
informed that – W.N. Chadha of M/s Anatronic General Corporation, C4,
Main Market, Vasant Vihar, New Delhi 110057, was their agent, and that,
apart from W.N. Chadha, Hersh W. Chadha, Marketing Director of M/s
Anatronic General Corporation, B.B. Bhatnagar (retired) and Brig. A.L.
Verma (retired) were designated:
i) to liaise with the Government of India for the contract;
ii) to liaise with the Indian Authorities.
8. Consequent to the changed defense purchase policy, the Defense
Department, asked M/s Bofors on May 3, 1985, to dispense with the services
of its declared agent and comply with such Indian Defense policy
requirements. Bofors did not respond immediately and as late as on March
10, 1986 informed the Defense Secretary that, Bofors “do not have any
representative/ Agent especially employed in India for this project”. However,
for administrative services, such as hotel bookings, transportation, forwarding
of letters, telexes, etc., were using a local firm, Anatronic General
Corporation, C4, Main Market, Vasant Vihar, New Delhi.
9. Be that as it may, on March 24, 1986, a contract number
6(9)/84/D/(GS.IV), was entered into between the Govt. of India and M/s
Bofors, after approval by the then Prime Minister, who was also the Defense
Minister, for supplying four hundred FH 77B systems along with vehicles,
ammunition and other accessories, at a total cost of SEK 8,410,660,984
[equivalent approximately to Rs. 1437.72 crores (as per the exchange rate on
March 21, 1986, SEK = 1.7094 Rs. Without reducing any agent
representation]. The aforesaid contract was signed by S.K. Bhatnagar for and
behalf of the Govt. of India and by Martin Ardbo, President Bofors and also
by Anders G. Cariberg, president and Chief Executive Officer of Nobel
Industries, for and on behalf of M/s. Bofors.
10. As per the terms of payments stipulated in this contract, 20% of
the total amount of the contract (with the exclusion of any amount related to
services) was to be paid by the buyer, i.e., Govt. of India, in advance, within
30 days from presentation by the seller, i.e. M/s Bofors, of an advance
payment guarantee. On receipt of the advance payment guarantee from
Bofors on April 7, 1986, the advance payment of SEK 1,682,132,196.80
(Rs.296.15 Crore), equivalent to 20% of the contract value was paid to M/s
Bofors on May 2, 1986.
11. From here the events took a turn. On 16.04.1987, i.e, over a year
after the said contract was executed, when the advance money had been paid
by the Govt. of India as per the terms of the contact and after delivery of the
gun systems had started, a Radio Broadcasting channel “Dagens Eko” of the
Swedish Radio, came out with a sensitive news. It unfolded that Bofors had
violated the Swedish Law by managing to obtain this Gun Supply contract
from the Govt. of India, amongst other things, due to the fact that local agents
had been paid large amounts in “bribes”.
12. It further stated that the agents had helped Bofors in getting the
contract by dubious means with the help of local contacts and support within
the – Indian Military Authorities, the Bureaucracy and concerned politicians.
The illicit payments to the agents and others were said to have been made by
transactions in secret bank accounts in Switzerland.
13. This news became a center of media & political attention in India
also and was intensely reported everywhere, raising very sensitive issues of
Indian Defense Policies, corruption, manipulations etc. The Govt. of India
acted on these disturbing events, and on 2141987, made a formal request to
the Government of Sweden for an investigation into the allegations.
14. The Swedish Government accepted the request of the Govt. of
India and ordered an enquiry by its organization, the Swedish National Audit
Bureau (SNAB). The SNAB submitted its report to the Swedish Government
of June 01, 1987, which was forwarded on June 04, 1987 to the Govt. of India.
SNAB report, interalia stated that considerable amounts were paid to some
agents by M/s A.B Bofors.
15. SNAB also confirmed that payments to the tune of SEK 170250
million were indeed made by Bofors in connection with this Defense contract
to its previous agent in India, but the names of the recipients were not
mentioned.
16. Facts thus emerged from SANB report that despite having full
knowledge about the policy of the Govt. of India that there should not be any
agent whatsoever in this deal, Bofors continued with its old agent. Further, the
amount such commission instead of reducing from price was paid to agent
and related parties. Bofors thus acted in violation of the Indian defense
policies and rules and harmed the public exchequer, besides committing
breach of propriety etc.
17. It emerged further that despite the Indian Govt's insistence not to
appoint or pay any agent, Bofors entered into a fresh consultancy agreement
with M/s. AE Services Limited of U.K. On November 15, 1985 at the behest
of one “Q”, an Italian. According to this agreement, M/s. AE Services was
appointed as a consultant to M/s. Bofors for getting the award of the contract
for 155 mm gun systems from the Govt. of India, to perform the following
services :
(i) to support Bofors in its bid for the contract according to
instructions of Bofors;
(ii) to keep Bofors informed of the updodate situation and progress
of negotiations.

18. Bofors was to pay a fee equivalent to 3% of the total value of the
contract pro rata with the receipt of the payments. As per its terms, the
Agreement was to cease automatically on April 1, 1986, if by this date, the
contract was not awarded by the Govt. of India to Bofors. Thus, M/s AE
Services were to get the fees only if the contract was, in fact, awarded a week
before that date. It thus emerged that Bofors deliberately suppressed the fact
of their aforesaid Agreement dated 15.11.1985 with M/s. AE Services in their
letter dated 10.03.1986, addressed to the Ministry of Defense, in terms of
disclosure and reducing the cost of the deal as stipulated.
19. Investigation revealed that the said “Q” had contacted Myles
Tweedale Scott, Director of M/s. AE Services Limited, sometime before
7.8.1985, for the purpose of the said agreement and was instrumental in
bringing about the said agreement between M/s. AE Services Limited and
M/s. Bofors. “Q” remained in India from 28.02.1965 to 29.07.1993, except for
a brief interval from 04.03.1966 to 120.06.1968. He was a Certified Chartered
Accountant by profession, working with M/s. Snamprogetti, an Italian
multinational company (MNC) providing the services of designing,
engineering, management of construction and the training of personnel in the
sector of oil refineries, gas processing, petrochemicals, fertilizers and
pipelines. Neither Snamprogetti, nor “Q” had any experience of guns, gun
systems or any related defense equipments.
20. It emerged that after payment of SEK 1,682,132,196.80 (Rs.
29615.00 Lakhs), equivalent to 20 % of the contract value, to Bofors on May
2, 1986 by the Govt. of India, Bofors remitted a sum of SEK 50,163,966.00
(equivalent to US $ 7,343,941.98), on September 03, 1986, to A/c No.
1805153 of M/s AE Services Limited at Nordfinanz Bank, Zurich. This
Account of M/s AE SERvices Limited C/o Mayo Associates SA, Geneva, had
been opened only a fortnight earlier, on August 20, 1986, by Myles Tweedale
Stott as its Director. This amount of SEK.50,463, 966.00 works out to be
exactly 3% of the amount of advance paid by the Govt. of India to Bofors and
was, thus, perfectly in accordance with the terms set out in the A.E. Services
Ltd. Bofors Agreement dated November 15, 1985.
21. From this Account of M/s. AE Services, an amount totaling US
$7,123,900 was transferred ($ 7,000,000 on September 16, 1986, and $ 123900
on September 29, 1986) to Account No.254.561.60W of M/s. Colbar
Investment Limited Inc., Panama with the Union Bank of Switzerland,
Geneva. An amount of US $ 7,943,000 was further transferred from the above
said Account of M/s. Colbar Investments Limited Inc. on July 25, 1988, to
Account No.488.320.60 X of M/s. Wetelsen Overseas, SA with the Union
Bank of Switzerland, Geneva. Thereafter, on May 21, 1990 an amount of US $
9,200,000 was transferred from the above said Account of M/s. Wetelsen
Overseas, to Account No.123983 of International Investments Development
Co., in Ansbacher (CI) Limited, St. Peter Port, Guernsey (Channel Islands).
These Accounts of M/s. Colbar Investments Limited Inc., as well as M/s.
Wetelsen Overseas, were being controlled by “Q” and his wife Maria
Quattrocchi.
22. Enquiries further revealed that, while opening the Account of
Colbar Investments Ltd. Inc. with the Union Bank of Switzerland, Geneva on
March 30, 1984, “Q” had mentioned his address in India as “Colony East,
New Delhi, India”, which was a fake and nonexistent address.
23. Investigations in Guernsey (Channel Island) also revealed that the
entire money, i.e. US $ 9.2 million, was further channeled to various
Accounts in Switzerland and Austria, within a period of 10 days of its receipt
in Guernsey. Letters Rogatory were issued by the Court of Special Judge,
Delhi to the competent Authorities in Switzerland and Austria for judicial
assistance in investigation in these countries.
24. More investigative revelations demonstrated that Bofors also had
another consultancy agreement with an entity incorporated in Panama,
namely , “M/s. Svenska Inc.” since the year 1978. Despite the Govt. of India's
initial policy requiring foreign bidders to declare the agent in a prescribed
proforma and its subsequent policy requiring foreign bidders to remove their
agents and to reduce the commission amount from the deal price, Bofors yet
again was found to be violating Indian national policies. By this so called
agreement Bofors committed to pay a commission to M/s. Svenska Inc. out of
any contract signed by Bofors in India, Sri Lanka, Nepal etc. This agreement
was modified from time to time and it was agreed in January 1986 that
commission to the extent of 3.2% of the exworks value would be paid to M/s
Svenska Inc. Out of this, 2.24 % (two point two four per cent) of the total ex
works value was to be paid without delay when the advance payment had
been received by Bofors. The remaining 0.96% (point nine six per cent) of the
exworks value was to be paid pro rata without delay when the payments for
deliveries had been received by Bofors.
25. Letters Rogatory were issued by the Court of Special Judge,
Delhi to Switzerland, Sweden, Panama, Luxembourg, Bahamas, Jordan,
Liechtenstein and Austria, with a view to finding out other beneficiaries of
the commission amounts.
26. The documents received from the Swiss Authorities, in response
to the letter by Rogatory, revealed that the following payments were made by
Bofors to Svenska from their Account with Skandinaviska Enskilda Banken,
Stockholm, on May 6, 1986.
SEK 113.39283.64 equivalent to US$ 16,070,412.80
SEK 28259820.64 FFR 27,957,875.84
SEK 28259820.92 CHF 7,346,128.29
SEK
18839879.98
XEU 2,720,363.87
Total SEK 188,398,805.18
A calculation will show that this a almost 2.24% of the total
value of the contract i.e., SEK8410660984, exactly as per the terms of the
aforesaid Agreement.
27. The following additional payments made by Bofors revealed that
each additional payment works out to be exactly .96% of a particular invoice
of Bofors and the date of payment also matches with the date of payment by
the Govt. of India.
Invoice No., its date & date of Gross amount of Commission @ 0.96% (in
payment Invoice (in SEK) SEKO)
1014271 dated 29.7.86 paid on 67,166,028 644,793.87
8.8.86
2010043 dated 20.2.87 paid on 66,657,160 639,908.75
2.3.87
102008 dated 19.2.98 paid on 9.3.87 13,981,805.92 134,225.34
2010136 dated 16.3.87 paid on 71,468,308 686,095.76
7.4.87
1010496 dated 23.3.87 paid on 27,195,139 264,456.18
2.4.87 and 1010488 dated 20.3.87 352,380
paid on 3.4.87
28. Inquiries further revealed that, including the above payments,
M/s. Bofors had paid an amount equivalent to SEK 192156200.05 during the
period from April 24, 1986 to March 30, 1987 in the name of M/s. Svenska
Inc. Panama, for the said deal with the Government of India, which were
credited to Account No.99921TU of Mr. W.N. Chadha then resident of C5/7,
Vasant Vihar, New Delhi (India) with Swiss Bank Corporation, Geneva. The
said Account was opened on August 9, 1983 with initial deposit of US
$160,000. For the said Account, Mr. W.N. Chadha had given a Powers of
Attorney in favour of his wife Ms. Kanta W. Chadha and his son Hersh W.
Chadha. It also emerged that the Board of Directors of M/s. Svenska Inc.,
Panama, in its meeting held on 30.4.1980, had authorised W.N. Chadha, then
resident of C5/7, Vasant Vihar, New Delhi, to open and operate bank
accounts of any type at any banking institution by a Power of Attorney, with
the fullest rights and powers to substitute any one else's name in place of his
own for the said purpose.
29. Investigations revealed that Mr. W.N. Chadha and “Q” had been
transferring the funds received from Bofors frequently from one account to
another and from one jurisdiction to another to avoid detection and to
obliterate the trial of the money.
30. The advance payment of SEK 1,682,132,196.80 (Rs.296.15
Crores) equivalent to 20% of the contract value was disbursed by the Govt. of
India to Bofors on May 2, 1986. The balance 60% of the contract amount
equivalent to SEK 6,728,528,787.60 was paid to Bofors during August 1986 to
1990, from time to time, against the deliveries. The investigations revealed
that an amount of SEK 242.62 million was paid by M/s. AB Bofors, as
commission, to Quattrocchi and W.N. Chadha through M/s. A.E. Services and
M/s. Svenska, in contravention of the policy of the Govt of India not to allow
middlemen/agents in the deal. No commission was to be paid by Bofors in
connection with the contract. If any such stipulation in this regard did exist,
the commission amount should have been reduced from the contract price.
Thus, the Govt. of India had to pay excess amount of total SEK 242.62
million, which was passed on by Bofors to its agents Mr. W.N. Chadha and
Mr. Quattrocchi against the express terms of contract.
31. It shall be pertinent to mention relevant dates in form of a chart
to further corelate the events and history:
S. No. Date Particulars

1. 1975 Expert committee set up under Chairmanship of Lt. General K.V.
Krishna Rao which recommended induction of medium gun of
155 mm caliber – pg 157 of PB dated 12.04.2010
2. October, 1978 Mr. W.N. Chadha entered with AB Bofors for representation in
India for a period of three years ending in September, 1981, which
provided commission @ 2%.
3. March, 1981 The Representation Agreement between AB Bofors and Mr. W.N.
Chadha extended for another period of three years. This was
followed by another agreement with M/s Anatronic General
Corporation for a period of three years.
4. March, 1980 Trials were conducted for guns whose tenders had been received
April, 1982 by the Ministry of Defense pg. 157.

5. July, 1982 Army Headquarters sent a draft CCPA paper to the Ministry of
Defense in connection with procurement of guns. pg 157
6. October, 1982 Ministry of Defense asked Army Headquarters to prepare detailed
evaluation report on the basis of the trials conducted. pg 157
7. December, The General Staff Evaluation Report of 1982 shortlisted the
1982 following guns (a) British, (b) Austrian, (c) French Sofma and (d)
FH77B gun from Bofors, Sweden. pg 157 & 158.
8. May, 1984 AB Bofors accepted as late as 30.11.9/84 a revised contract to Mr.
W.N. Chadha with reduced rates since Bofors had not been able to
get any business in India.
9. May, 1984 Negotiating Committee set up a negotiate with the shortlisted
companies. pg 158.
10. 18.08.84 to Negotiations were held between the short listed companies and the
28.08.84 Negotiating Committee.
11. 24.08.1984 Army Headquarters recommended that the British and Austrian
systems were not acceptable and one again recommended Bofors,
Sweden and Sofma, France – pg. 158159.
12. 30.11.1984 Mr. W.N. Chadha signed the revised Representation Agreement
with Bofors which provided commission @ 0.25 % for a period of
three years
13. End of 1985 Bofors informed Mr. W.N Chadha that as per the request of the
Indian Prime Minister, Bofors could not employ any middlemen in
the deal with the Indian authorities.
14. 03.01.1986 Bofors sent a letter to Mr. W.N. Chadha stating that all
representation agreements between Anatroic/Mr. Chadha and
Bofors stood rescinded as on 31.03.1985.
15. January, 1986 Mr. W.N. Chadha signed an Administrative Consultancy

Agreement with Bofors under which he was to be paid 100,000
SEK per month irrespective of Bofors getting any business in
India.
16. 17.02.1986 Army Headquarters submitted their final technical evaluation
report stating that the Swedish Bofors gun had a clear edge over
the French Sofma gun. pg. 159
17. 10.03.1986 Bofors confirmed that they did not employ any agent in India in

respect of the deal with Ministry of Defence for the FH77B gun
deal—pg. 140.
18. 21.03.1986 Revised offer received from Bofors, Sweden — pg. 159.
19. 22.03.1986 Revised offer received from Sofma, France —pg. 159.
20. 24.03.1986 The deal with Bofors was approved and MOU signed with the
Government of Sweden —pg. 159.
21. 17.04.1987 Leading newspapers in India gave coverage to Swedish Radio
Broadcast that bribes had been paid to senior Indian politicians
and key Defence figures in connection with the Bofors gun deal.
Pg. 140.
22. 04.06.1987 SNAB report submitted to Ministry of External Affairs pg. 143.
23. 29.07.1987 Union Minister of Defence, Mr. KC Pant, moved motion in Lok
Sabha for appointment of a Joint Parliamentary Committee. Pg.
144.
24. 12.08.1987 Rajya Sabha also approved formation of JPC —pg 148.
25. 28.08.1987 JPC set up —pg 148.
26. 28.08.1987 JPC submitted its report giving a clean chit to Shri W.N. Chadha
— paper book dated 12.04.2010.
32. As against “Q”, the case of CBI is that on the basis of source
information, certain facts and circumstances that became available, media
reports, report of Swedish National Audit Bureau, certain facts contained in
the report of Joint Parliamentary Committee (JPC) and the report of
Controller & Auditor General of India, it was alleged therein that during the
period between 198287, certain public servants entered into a criminal
conspiracy with certain private persons/others, in India and abroad, and in
pursuance thereto committed offence of bribery, cheating, swindling and
forgery, in respect of a contract dated 24.03.1986, entered between
Government of India and AB Bofors of Sweden for supply of guns, towed
vehicles and ammunition by AB Bofors to Government of India. A
percentage of said amount of contract was remitted by AB Bofors in a
clandestine manner to certain public bank accounts in Switzerland as “illegal
gratification” for the benefit of certain public servants of the Government of
India and their nominees. As per the chargesheet filed in the matter, the
investigation had revealed that AB Bofors had obtained contract pursuant to
entering into conspiracy with certain public servants, who were responsible
for decision making process, even though the gun system offered by them was
inferior to the other available alternatives. The investigation further revealed
that in spite of “express policy” of the Government of India, M/s AB Bofors
in conspiracy with “Q” and others appointed M/s A.E Services, UK as one of
their agents through Agreement dates 15.11.1985 to secure the contract. “Q”
was found instrumental in execution of contract with AB Bofors in November'
1985. AB Bofors were paid an amount equivalent to US $ 73,43,941.98 and
the same was credited on 08.09.1996 in their bank account, ostensibly for this
purpose. In part execution of letter rogatory, the Swedish authorities had
made available copies of certain documents, duly authenticated, which
revealed that the amount credited in the account of M/s AE Services was
laundered further. After an interval of eight days only, the amount of US $
71,23,900.00 was transferred in two instalments of US $ 7,00,000.00 and US $
12,390.00 on 16.09.1986 and 29.09.1986 respectively to an account of M/s
Coalbar Investment Limited Inc., Union Bank of Switzerland, Geneva,
Switzerland. This account was authorised to be operated and controlled by
“Q” and his wife “Maria Quattorocchi”. At the relevant time, “Q” was
employed with M/s Snamprogetti (an Italian MNC) and was stationed in
Delhi. In the relevant document, “Q” gave a nonexistent address in Delhi. It
was further revealed that the aforesaid amount was again transferred on “Q's”
instructions to the account of M/s Wetelson Overseas, S.A of Panama on
25.07.1989 in the same bank. The said company was floated in Panama on
06.08.1989 and was dissolved on 07.08.1990, indicating that this company
floated only to receive this money and used as “conduit” for paying illegal
payments through the bank accounts, which could be operated and controlled
by “Q” and his wife individually. While letter rogatory was under process,
US $ 20,000.00 was again transferred from the account of M/s M/s Wetelson
Overseas, S.A, in UBS, Geneva to InterInvestment Company for the benefit
of International Investments Development Company, in Ansbacher (CI)
Limited, St.Peter Port, Guernsey (Channel Islands) on 21.05.1990. As per the
chargesheet, the entire transaction of payment by M/s AB Bofors to M/s AE
Services and others were intended to mascuard the illgotten payment/
commission/bribe and thus the Government of India was defrauded and put to
loss. It has been further stated that “Q” is the holder of Italian Passport and
he left India abruptly in July' 1993. As such, a strong suspicion of his
involvement in this case has been expressed.
33. In this case, on 22.10.1999, CBI filed a chargesheet against Shri
S.K Bhatnagar, Shri Win Chaddha, “Q”, Mr.Martin Ardbo and M/s AB
Bofors and thereafter on 09.10.2000 supplementary chargesheet was filed
against Shri S.P Hinduja, Shri G.P Hinduja and Shri P.P Hinduja (hereinafter
referred to as “Hinduja Brothers”). Since, presence of Mr.Martin Ardbo and
“Q” was not being secured and unnecessary delay was taking place, the court
of Ld.Special Judge, vide order dated 25.05.2001 separated the trial of “Q”
and Mr.Martin Ardbo. However, later on Mr.Martin Ardbo expired and the
proceedings against him abated. Similarly, S.K Bhatnagar and Win Chaddha
also expired and proceedings against them also abated.
34. On the directions of CBI, a Red Corner Notice, bearing No.
5323/97 (A44/21997) had been issued against “Q” on 17.02.1997, pursuant
whereto, he was arrested in Malaysia. However, vide order dated 02.12.2002,
of the Ld.Sessions Judge at Kualalampur, Malaysia, he was discharged from
the extradition case. The Court of Appeal at Kualalampur, Malaysia vide its
judgment dated 13.12.2002 upheld the order of Sessions Court. The Federal
Court of Malaysia also upheld the order of discharge of “Q” in extradition
case vide its judgment dated 30.04.2003 and as such, the attempt of CBI in
extraditing “Q” from Malaysia failed at three levels.
35. On 14.11.2002, the learned Special Judge had framed charges in
the matter against M/s AB Bofors, Shri S.P Hinduja, Shri G.P Hinduja and
Shri P.P Hinduja. All the aforesaid persons challenged the framing of charges
against them before the Hon'ble High Court of Delhi, by way of Criminal
Misc. (Main) No.3938/03, which was disposed off by the Hon'ble High Court
vide judgment dated 04.02.2004, interalia holding as under:
xxxxx
(i) Charges for offences punishable under Sections 120B/420 IPC
and Section 5(2) r/w Section 5(1)(d) of Prevention of Corruption Act,
1947 and Section 165 A r/w Section 161 IPC against the petitioners for
having entered into a criminal conspiracy with the public servants to
cheat the Government of India and having abetted the public servants to
commit criminal misconduct by abusing their official position and taken
illegal gratification for awarding contract are quashed.
(ii) The charges that need to be framed against the petitioners P.P
Hinduja, G.P Hinduja and S.P Hinduja for the offences punishable U/s
120 B/420 IPC for having entered into a criminal conspiracy between
April, 1985 to March, 1986 to cheat the Government of India by
fraudulently and dishonestly representing that there were no agents
involved in the negotiation for the contract and further that the price
quoted was reduced price proportionate to the amount of commission
they would have otherwise paid to the agents and thereby induced the
Government of India to award the contract in favour of Bofors and
caused wrongful loss to the Government of India to the extent of amount
they would have paid as commission to the agents viz. Hindujas, Win
Chadha and Quattorocchi.
(iii) Charge for the offence punishable U/s 465 IPC for having made
false documents as referred in the impugned order shall be framed
against M/s A.B Bofors.
143. Since the cases were brought within the jurisdiction of the
Special Judge merely by including the offence punishable U/s 5(2) of
Prevention of Corruption Act, 1947 on account of criminal misconduct
by public servants by abusing their official position by awarding the
contract, so as to gain pecuniary advantage to Bofors and its agents and
themselves and all other offences were triable by the Magistrate and
since the charge for this offence has been held to be unsustainable, the
cases against the petitioners, including those of Martin Ardbo and
Mr.Quattrocchi shall stand transferred to the court of Chief
Metropolitan Magistrate for framing of charges, as observed in this
order.
143. In view of inordinately procrastinated investigation, CMM shall
in order to maintain and restore the confidence of people in the
effectiveness of administration of criminal justice, take up the case as far
as possible on daytoday basis and try to conclude the trial and decide
the case as expeditiously as possible. CBI shall also confine its
evidence strictly in terms of the charges for the offences punishable U/s
120B/420 IPC against the petitioners and offence U/s 465 IPC against
M/s A.B Bofors. Parties to appear before CMM on 23.02.2004.
xxxxx
36. Pursuant to the aforesaid judgment of the Hon'ble High Court,
this court, vide order dated 26.03.2004 framed charges against Hinduja
brothers and M/s A.B Bofors U/s 420 IPC r/w Section 120 B IPC. The
aforesaid order of this court was challenged before the Hon'ble High Court by
way of Criminal Revision Petition No.271/2004, which was disposed off by
the Hon'ble High Court vide judgment dated 31.05.2005, interalia holding as
under:
“67. From what has been noted and discussed above and on the basis
of the statements made by the prosecution, no case cane be proceeded
with in respect of the Hinduja Brothers or the Bofors Company. I,
accordingly, allow Crl.M.A 169/2005 & 170/2005 in Crl.Rev.271/2004,
Crl.M.AS 171/2005 & 172/2005 in Crl.Rev.272/2004, Crl.M.A 173/2005 &
174/2005 in Crl.Rev.273/2004 and Crl.M.C 763/2005. I quash all the
proceedings against the Hinduja Brothers emanating from FIR/Case
No.RC1(A)/90ACIIV/SIG/New Delhi and discharge them from the
case. I also quash order dated 26.03.2004 of the Chief Metropolitan
Magistrate framing charges against the Bofors Company and discharge
the Company from the case. The bail bonds and surety bonds shall
stand discharged. The record received from the trial court be sent back
forthwith”.

37. The CBI did not challenge the aforesaid two judgments before the
Hon'ble Supreme Court and as such, the aforesaid judgments attained finality.
It transpired from submissions of “Aggarwal” that he had filed an SLP against
the judgment dated 31.05.2005, passed by the Hon'ble High Court of Delhi in
Crl. Revision No.271/2004, which is pending disposal before the Hon'ble
Supreme Court.
38. The grounds taken in this application for withdrawal of
prosecution against “Q” are as under:
(a) That 23 years have passed from the date of alleged offence and
more than 19 years have elapsed after registration of the case.
(b) That all other coaccused have either died or proceedings
against them have been quashed, including the proceedings against M/s
A.B Bofors and the alleged beneficiaries of the contract by virtue of the
judgments of the Delhi High Court and no appeals have been preferred
by the CBI either against the order of Hon'ble Mr.Justice J.D Kapoor or
the judgment of Hon'ble Mr.Justice R.S Sodhi.
(c) Even though there is an undertaking by M/s A.B Bofors prior to
entering into the contract that they do not have any representative/agent
specially employed in India, I notice that the original contract between
M/s A.B Bofors and Government of India does not provide for any
prohibition for employment or nonemployment of Indian or foreign
agents. I also notice that full payments in regard to the contract have
been paid to M/s A.B Bofors even after lodgment of FIR. I find that no
steps to recover any monies were adopted against M/s A.B Bofors.
(d) In view of judgment of Hon'ble Mr.Justice J.D Kapoor, any
allegations of corruption or conspiracy with public servants is knocked
out.
(e) In any event, the attempts to secure the presence of Ottavio
Quattrocchi from Malaysia and Argentina have failed. I find that the
Malaysian Court has also touched upon the merits of the matter”.
39. I have heard the learned Additional Solicitor General of India and
“Aggarwal” at length and have perused the entire material on record
meticulously. However, “Gupta” stopped appearing in the matter after two or
three hearings and as such, he could not be heard completely. Now, I propose
to decide as to whether “Aggarwal” and for that matter even “Gupta” has
“locusstandi” to oppose this application in “public interest”. A perusal of
record would reveal that “Aggarwal” has challenged the judgment dated
31.05.2005 of the Hon'ble High Court of Delhi against the discharge of
“Hinduja Brothers”, before the Hon'ble Supreme Court, where his SLP is
lying admitted. He also appears to have filed several interlocutory
applications from time to time as well as a Writ Petition before the Hon'ble
Supreme Court and some directions were passed by the Hon'ble Supreme
Court on his applications from time to time in public interest. The question
which falls for consideration of this court is whether that is sufficient for him
to have “locusstandi” to oppose this application before this court,
particularly in view of the fact that this court does not have inherent powers,
as contemplated U/s 482 Cr.P.C, whereas the Hon'ble Supreme Court has
ample powers U/s 482 Cr.P.C as also under Article 136 of the Constitution. It
is also apparent that this is neither a public interest litigation which is pending
before this court, nor this court has jurisdiction to entertain any public interest
petition, which the Hon'ble High Court has under Article 226 and 227 of the
Constitution and Hon'ble Supreme Court under Article 32 of the Constitution
has. The arguments of “Aggarwal” were that he is a public spirited citizen of
this country and has “locusstandi” to oppose this application in the “public
interest”.
40. It is necessary to take note of the meaning of the expression
“Public Interest”.
41. In Shroud's Judicial Dictionary, Vol.IV, 4th Edition, “Public
Interest” is defined as under:
“Public Interest A matter of public or general interest does not mean
that which is interesting as gratifying curiosity or a love of information
or amusement; but that in which a class of the community have a
pecuniary interest, or some interest by which their legal rights or
liabilities are affected.”
42. In Black's Law Dictionary, 6th Edn., “Public Interest” is defined
as follows:
“Public Interest Something in which the public, the community at
large has some pecuniary interest, or some interest by which their legal
rights or liabilities are affected. It does not mean anything so narrow as
mere curiosity, or as the interests of the particular localities, which may
be affected by the matters in question. Interest shared by citizens
generally in affairs of local, State or National Government.”
43. In case reported as, “1992(4) SCC 305”, titled as, “Janta Dal
V/s H.S Chaudhary”, the Hon'ble Supreme Court considered the scope of
“public interest litigation”.
44. In para 26 of the aforesaid judgment, the Hon'ble Court observed
as under:
xxxxx
“26. Even if there are million questions of law to be deeply gone into
and examined in a criminal case registered against specified accused
persons, it is for them alone to raise all such questions and challenge the
proceedings initiated against them at the appropriate time before the
proper forum and not for the third parties under the garb of public
interest litigants.”
xxxxx
(Emphasis supplied)
45. Further, in para 53 of the said judgment, after considering what
is “public interest”, it was laid down as follows:
xxxxx
53. The expression “litigation” means a legal action, including all
proceedings therein, initiated in a court of law with the purpose of
enforcing a right or seeking a remedy. Therefore, lexically the
expression “PIL” means a legal action initiated in a court of law for the
enforcement of public interest or general interest in which the public or a
class of the community have pecuniary interest or some interest by which
their legal rights or liabilities are affected.”
xxxxx
46. In para 62 of the aforesaid judgment, it was pointed as follows:
xxxxx
62. Be that as it may, it is needless to emphasise that the
requirement of locus standi of a party to a litigation is mandatory,
because the legal capacity of the party to any litigation whether in
private or public action in relation to any specific remedy sought for has
to be primarily ascertained at the threshold.”
xxxxx
47. In para 98 of the aforesaid judgment, it was further pointed as
follows:
xxxxx
98. While this court has laid down a chain of notable decisions with
all emphasis at their command about the importance and significance of
this newly developed doctrine of PIL, it has also hastened to sound a red
alert and a note of severe warning that courts should not allow its
processes to be abused by a mere busybody or a meddlesome interpoler
or wayfarer or officious intervener without any interest or concern
except for personal gain or private profit or other oblique consideration.”
xxxxx
(emphasis supplied)
48. In para 109 of the aforesaid judgment, it was further pointed as
follows:
xxxxx
109. It is thus clear that only a person acting bonafide and having
sufficient interest in the proceeding of PIL will alone have a locusstandi
and can approach the court to wipe out the tears of the poor and needy,
suffering from violation of their fundamental rights, but not a person for
personal gain or private profit or political motive or any other oblique
consideration. Similarly, a vexatious petition under the colour of PIL
brought before the court for vindicating any personal grievance, deserves
rejection at the threshold.”
xxxxx
(emphasis supplied)
49. It is worth noting that H.S Chaudhary's case (supra), relates to
the controversy in the present case itself. At the relevant time, one advocate
namely Shri H.S Chaudhary, claiming to be the General Secretary of an
Organisation namely “Rashtriya General Parishad” had filed a Crl. Misc.
Petition before the learned Special Judge under Article 51 (A), interalia
praying that no request for rogatory be made to Swiss Government. A
further prayer was made therein that he should be permitted to join during
enquiry before the Court. The learned Special Judge dismissed his aforesaid
petition taking view that he had no “locusstandi”, whereafter he filed a
Criminal Revision Petition before the Hon'ble High Court of Delhi, raising
multiple questions of law, challenging the legality and validity of not only the
impugned order, but also the very chargesheet and FIR in this case. Even the
Hon'ble High Court observed in its judgment that he did not have “locus
standi”. The Hon'ble Supreme Court also ruled in the matter that he did not
have the “locusstandi”. “Aggarwal” is as such, a second lawyer, who has
shown similar demeanor, as was shown by Shri H.S Chaudhary, Advocate,
who was held to have no “locusstandi” in this matter upto the Hon'ble
Supreme Court.
50. This court during the course of hearing, on various dates noticed
that on the succeeding day of each date of hearing, there would be newspaper
reports about the arguments advanced in court by “Aggarwal” and some of
the reports were even sensational, wherefrom it can be reasonably deduced
that “Aggarwal” is interested in attaining cheap publicity by going to the
media persons after every date of hearing and playing trumpet of corruption
in this case by public servants contrary to the judgments already passed by
Hon'ble High Court of Delhi, by supplementing his own views about the case.
It is depressing to note that on account of such trumpery proceedings before
this court, innumerable days were wasted, which time otherwise could have
been spent for the disposal of cases of genuine litigants. It is a fact that the
courts, particularly at the subordinate level are flooded with cases which
include matters involving properties worth hundreds of millions of rupees and
criminal cases in which persons sentenced to death and facing gallows under
untold agony, persons sentenced to life imprisonment and kept in
incarceration for long years, persons suffering from undue delay in service
matters – government or private, persons awaiting disposal of cases wherein
huge amounts of public revenue or unauthorized collection of tax amounts are
locked up, detenus expecting their release from the detention orders etc., are
all standing in a long serpentine queue for years with the fond hope of getting
into courts and having their grievances redressed, the busy bodies,
meddlesome interlopers, wayfarers or officious interveners having absolutely
no public interest except for personal gain or private profit either of
themselves or as a proxy of others or for any other extraneous motivation or
for the glare of publicity break the queue muffling their faces by wearing the
mask of public interest litigation and get into the courts by filing vexatious
and frivolous petitions and thus criminally waste the valuable time of the
courts and as a result of which the queue standing outside the doors of the
court never moves, which piquant situation creates frustration in the minds of
genuine litigants and resultantly, they lose faith in the administration of our
judicial system (reference case reported as “(2004) 3 SCC 349”, titled as,
“Ashok Kumar Pandey V/s State of West Bengal”).
51. Further, in case reported as, “AIR 1952 Raj.42”, titled as, “Amar
Narain Mathur V/s The State of Rajasthan”, the Hon'ble Court observed as
under:
xxxxx
“3. .....A preliminary objection was raised by Mr.Pathak on behalf of
the State of Rajasthan and his contention was that the applicant had no
“locusstandi” and this court should not, therefore, hear his counsel.
The argument was that the applicant, Shri Amar Narain, was a complete
stranger to the proceedings and had, therefore, no right to apply to this
Court in revision. It was further urged that in a criminal case started at
the instance of the State a stranger had no right to apply to this Court in
revision when the Public Prosecutor had decided to withdraw from the
prosecution.”
“4. After hearing Mr.Pathak for the State of Rajasthan and
Mr.Sinha for the applicant, we have come to the conclusion that the
preliminary objection is well founded, and the applicant has no right to
apply to this Court in revision in the circumstances. In criminal cases, it
is the State which is in control of the proceedings, particularly where the
prosecution is launched at the instance of the State. In cases, therefore,
in which the Public Prosecutor appears it is for him to decide whether he
would continue with the prosecution or withdraw from it. If he decides
to withdraw, he has the power to apply to the Court U/s 494 Cr.P.C, for
giving consent to his withdrawal. This power cannot, in our opinion, be
subject to the wishes of a third person even though he might be
interested directly in the case. We may, in this connection, refer to two
cases of the Patna High Court. In the first, “Gopi Bari V Emperor”,
“AIR (7) 1920 Patna 362”, a case had been prosecuted by the police U/s
143 Penal Code. At a later stage, the Court SubInspector in charge of
the prosecution applied for withdrawing from the case under Section
494. This was objected to by the complainant and withdrawal was
thereupon refused. The accused then went up to the High Court and it
was held that where a case had been started upon a police report, and
the Court SubInspector wanted to withdraw from prosecution, the Court
acted without jurisdiction in rejecting the prayer for withdrawal, simply
because the complainant wanted to proceed with the case. It is further
held that in such a case, the complainant had no “locusstandi” to
control the proceedings.
xxxxx
(Emphasis supplied)
52. In another case, reported as, “AIR (11) 1924 Patna 283”, titled
as, “Gulli Bhagat V/s Narain Singh”, the Public Prosecutor applied for
withdrawal from the case at a late stage. This prayer was allowed by the trial
court and thereupon the complainant came to the High Court in revision.
The revision was rejected with the following observations:
xxxxx
“Finally there is a deeper and indeed a fundamental reason for non
interference which turns upon the position of a private prosecutor in
prosecutions of cognizable offences. In our opinion, the private
prosecutor has no position at all in the litigation. The crown is the
prosecutor and the custodian of public peace and if if decides to let an
offender go, no other aggrieved party can be heard to object on the
ground that he has not taken his full toll of private vengeance. If,
therefore, in the present case, the Court has allowed the Public
Prosecutor to withdraw the case upon insufficient or improper grounds,
the local Government, is the only authority who can take action for the
correction of that error.”
“6. The present applicant is even in a worse position than a private
prosecutor, for he is in no way connected with these five cases. What he
claims is that as a member of the public and Secretary of an Association,
called “Janta Kashta Niwarak Sangh”, he is interested in seeing that
these cases, which involve embezzlement of public funds in three of them
and bribery in two, should be thoroughly investigated and the guilt or
innocence of the accused, three of whom hold important public offences,
should be established in a court of law. This desire of the applicant may
be commendable, but we are of opinion that it gives him no “locus
standi” to come to this Court in revision. We, therefore, hold that the
applicant has no “locusstandi” to be heard by counsel. We also
intimated to the learned counsel for the applicant that we would only
hear him as “amicus curiae”.
xxxxx
(Emphasis supplied)
53. There is another interesting aspect in the matter. In this case,
“Aggarwal” passed on copies of several bundle of documents relating to this
case, which were not certified copies of the original record from the Court.
This Court made a pointed query to him to disclose the source of receipt of
those documents, to which “Aggarwal” stated that somebody from the O/o
CBI had left those documents at his office. Although, no issue on this point
was joined by CBI, however, this clearly shows that an attempt on the part of
“Aggarwal” was made to have the possession of official documents without
following the process of law. This practice has been strongly depricated by
the Hon'ble Supreme Court in case reported as, “(1998) Vol.VII SCC 273”,
titled as, “Dr.Duryodhan Sahu V/s Jitender Kumar Mishra”, interalia
holding as under:
xxxxx
“The other interesting aspect is that in the PILs documents are being
annexed without even indicating as to how the petitioner came to have
possession of them. In one case, it was noticed that an interesting
answer was given with respect to its possession. It was stated that a
packet was lying on the road and when out of curiosity, petitioner opened
it, he found the said papers. When such frivolous pleas to explain the
possession of the documents are taken, the Courts not only should
dismiss the petition, but also to impose exemplary costs. It is also
desirable for the Courts to freeze the frivolous petition and dismiss them
with costs as aforesaid, so that a message goes in the right direction that
petition filed with oblique motives do not have the approval of the
Courts.”
xxxxx
(Emphasis supplied)
54. Some of the other judgments, which are relevant on the aforesaid
point are as under.
55. In case reported as, “1976 (1) SCC 671” titled as, “Jasbhai
Motibhai Desai V/s Roshan Kumar”, the Hon'ble Supreme Court, held that
the application of a busybody should be rejected at the threshold in the
following terms:
xxxxx
“37. It will be seen that in the context of “locus standi” to apply for a
writ of certiorari, an applicant may ordinarily fall in any of these
categories:
(i) person aggrieved
(ii) stranger
(iii) busybody or meddlesome interloper.
Persons in the last aggrieved are easily distinguishable from
those coming under first two categories. Such persons interfere in
things which do not concern them. They masquerade as crusaders for
justice. They pretend to act in the name of pro bono publico, though
they have no interest of the public or even of their own to protect. They
indulge in the pastime of meddling with the judicial process either by
force of habit or from improper motives. Often, they are actuated by a
desire to win notoriety or cheap popularity; while the ulterior intent of
some applicants in this category, may be no more than spoking the
wheels of justice. The High Court should do well to reject the
applications of such busybodies at the threshold.”
xxxxx
(Emphasis supplied)
56. Hon'ble Justice Krishna Iyer in case reported as, “1981 (1) SCC
568”, titled as, “Fertilizer Corpn. Kamgar Union (Regd.) V/s Union of
India” in stronger terms stated:
xxxxx
“48. If a citizen is no more than a wayfarer or officious intervener
without any interest or concern beyond what belongs to any one of the
660 million people of this country, the door of the court will not be ajar
for him.”
xxxxx
(Emphasis supplied)
57. Even otherwise, State is the master of litigation, which controls
the proceedings, particularly in cases where prosecution is launched at the
instance of the State. Seeking withdrawal of the prosecution from the case is
within the domain of Executive and this Court, not vested with inherent
powers cannot allow private person to come and join the proceedings. A
word of “caution” in these type of cases has already been sounded by the
Hon'ble Supreme Court in a Constitution Bench judgment, reported as, “1987
(1) SCC 288”, titled as, “Sheonandan Paswan V/s State of Bihar”, in para 90
whereof, it was held as under:
xxxxx
“90. Section 321 Cr.P.C is virtually a step by way of composition of the
offence by the State. The State is the master of litigation in criminal
cases. It is useful to remember that by the exercise of functions under
Section 321 Cr.P.C, the accountability of the concerned person or
persons does not disappear. A private complaint can still be filed if a
party is aggrieved by the withdrawal of the prosecution, but running the
possible risk of a suit of malicious prosecution if the complaint is berefit
of any basis.”
xxxxx
58. In another case, reported as, “1992 (4) SCC 653 (para 7)”, titled
as, “Simranjit Singh Mann V/s UoI”, the Hon'ble Supreme Court observed
as under:
xxxxx
“7. .....We are, therefore, satisfied that neither under the provisions
of the Code nor under any other statute is a third party stranger are
permitted to question the correctness of the conviction and sentence
imposed by the Court after a regular trial.”
xxxxx
(Emphasis supplied)
59. Further, in case reported as, “1981 Cr.L.J 219”, titled as, “Abdur
Karim V/s The State & Ors.”, the Hon'ble Kolkata High Court held as under:
xxxxx
“In this connection, I may point out that though there is no direct
authority on the point, I am of the view that a private party has no locus
standi to move against an order of acquittal passed by the learned Judge
upon an application being made U/s 321 Cr.P.C to him by the Public
Prosecutor in a case which he was conducting. The language of Section
321 of the Code makes it quite clear that the matter is between the Public
Prosecutor and the Magistrate or the Judge concerned and a private
party has no right to interfere in such matters. Any Public Prosecutor
or Assistant Public Prosecutor in charge of a case may, with the consent
of the Court, at any time before the Judgment is pronounced, withdraw
from the prosecution of any person either generally or in respect of any
one or more of the offences for which he is tried. The Public Prosecutor
being the “custodian of the public justice” he is the only person who can
make an application for withdrawal and, if withdrawal is granted by the
court in the interest of administration of justice, no private party can
come up against the order of withdrawal.”
xxxxx
60. In yet another judgment of the Hon'ble Supreme Court, reported
as, “1996 (11) SCC 582”, titled as, “All India Institute of Medical Sciences'
Employees Union V/s UoI”, wherein the Employees' Union of AllMS had
filed a Writ Petition before the Hon'ble High Court of Delhi, interalia seeking
issuance of a Writ of Mandamus against Dr.S.K Kakkar for allegedly
committing cognizable offences punishable U/s 409 IPC, the Hon'ble High
Court refused to issue Mandamus. It was laid down that the Association had
the remedy of filing complaint case before the learned Magistrate having
jurisdiction to take cognizance of the offences, in case the police did not take
action on their complaint. The Association having not adopted the procedure
prescribed in the Cr.P.C, was not held entitled for Writ of Mandamus.
61. If the locus standi of Aggarwal and Gupta is judged on the anvil
of law laid down in the aforesaid judgments, then it would be apparent that
he/they cannot be permitted to participate in these proceedings as a matter of
right, particularly, when he/they could have taken recourse to the remedies
available to him/them under Cr.P.C in accordance with law. It is a matter of
fact that neither “Aggarwal” nor “Gupta” has any personal interest in the
litigation. They further do not have any legal capacity to appear before this
Court in opposition to this application. Their only interest in this opposition
appears to be curiosity, obtaining the glare of public and publicity, which are
not valid grounds to have “locusstandi”. However, this Court is really
thankful to “Aggarwal” for rendering valuable assistance to this Court in
taking this Court through the evidence collected by the investigating agency.
The said assistance is deemed to have been rendered by him as “Amicus
Curiae” and not as a person having “locusstandi” to participate in the
proceedings. Therefore, all the applications filed by “Aggarwal” in the
matter stand dismissed, including the last application, which was filed as late
as on 03.03.2011.
62. The matter does not end here. Now, this court will have to judge
the application from the point as to whether the learned Special Prosecutor
has exercised his executive function properly and examined the matter in its
entirety and has applied his mind in good faith and bonafide manner; as also
to examine the grounds taken for withdrawal of prosecution against “Q”.
Before that, it will have to be seen as to what is the requirement of law in this
regard.
63. The controversy in the present application revolves around
Section 321 of the Code of Criminal Procedure, 1973 which is being
reproduced herein below:
321.
Withdrawal from prosecution:

The public Prosecutor or Assistant Public Prosecutor in charge of a
case may, with the consent of the Court at any time before the judgment
is pronounced, withdraw from the prosecution of any person either
generally or in respect of any one more of the offences for which he is
tried; and upon such withdrawal:
(a) If it is made before a charge has been framed, the
accused shall be discharged in respect of such offence or offences;
(b) If it is made after a charge has been framed, or when
under this code no charge is required he shall be acquitted in respect of
such offence or offences;
1. Provided that where such offence:
(i) Was against any law relating to a matter to which the
executive power of the Union extends, or
(ii) Was investigated by the Delhi Special Police
Establishment under the Delhi Special Police Establishment Act,
1946 (25 of 1946), of
(iii)Involved the misappropriation or destruction of, or damage to,
any property belonging to the Central Government, or
(iv) Was committed by a person in the service of the Central
Government while acting or purporting to act in the discharge of
his official duty, and the prosecutor in charge of the case has not
been appointed by the Central Government he shall not, unless he
has been permitted by the Central Government to do so, move the
Court for its consent to withdraw from the prosecution and the
Court shall, before according consent, direct the Prosecution to
produce before it the permission granted by the Central
Government to withdraw from the prosecution.”
64. This particular Section has received scrutiny from the Hon'ble
Supreme Court of India in several cases. With a view to deduce the
requirement of law for consideration on application U/s 321 Cr.P.C, I wish to
refer to the precedents, which are as under.
65. In case reported as, “AIR 1975 SC 389”, titled as, “State of
Bihar Vs. Ram Naresh Pandey”, one Mahesh Desai was accused of
committing murder. Murder was stated to be committed in course of a riot
which resulted from difference between two rival trade union groups. An
application under Section 494 of the Code of Criminal Procedure 1898
(corresponding to Section 321 of the Code of Criminal Procedure 1973) was
filed by the Public Prosecutor seeking permission to withdraw from the
prosecution. Withdrawal was sought on the ground that on the evidence
available it would not be just and expedient to proceed with the prosecution of
Mahesh Desai. Trial Court granted permission for withdrawl. In revision, the
Session Judge also upheld the order of the Trial Court. In appeal, the Hon'ble
High Court reversed the order of the Trial Court on the ground that “there
was exercise of no judicial discretion in the present case.” Hon'ble Supreme
Court reversed the judgment of the High Court and affirmed the order of the
Trial Court granting permission to the prosecution to withdraw from the
prosecution of Mahesh Desai. It was inter alia observed as under:
xxxxx
“The function of the Court, therefore, in granting its consent my well be
taken to be a judicial function. It follows that in granting the consent the
Court must exercise a judicial discretion. But it does not follow that the
discretion is to be exercised only with reference to material gathered by
the judicial method. Otherwise the apparently wide language of s.494
would become considerably narrowed down in its application. In
understanding and applying the section, two main features thereof have
to be kept in mind. The initiative is that of the Public Prosecutor and
what the Court has to do is only to give its consent and not to determine
any matter judicially. The judicial function, therefore, implicit in the
exercise of the judicial discretion for granting the consent would
normally mean that the Court had to satisfy itself that the executive
function of the Public Prosecutor has not been improperly exercised; or
that it is not an attempt to interfere with the normal course of justice for
illegitimate reasons or purpose.”
xxxxx
66. Further in case reported as, “(1972) 1 SCC 318”, titled as, “M.N.
Sankarayarayanan Nayar Vs. P.V.Balakrishanan”, accused persons were
charged for offences under Section 467, 478, 420 read with Section 109 of
Indian Penal Code. An application was moved by the Public Prosecutor
seeking withdrawal from the prosecution of accused persons. Withdrawal
was sought on following grounds:
(i) No likelihood of case being successful.
(ii) Interest of public policy.
(iii) Subject matter of case decided in a civil suit.
(iv) Delay in trial.
(v) Securing evidence involves heavy expenses for State.
(vi) Case is of civil nature.
Ld. Sessions Court granted permission to the prosecution, as
prayed for. Order of Ld. Session Court was upheld by the Hon'ble High
Court as also by Hon'ble Supreme Court. In para 5 of the judgment, Hon'ble
Supreme Court observed as under:
“5. Though the Section is in general terms and does not
circumscribe the powers of the Public Prosecutor to seek permission to
withdraw from the prosecution the essential consideration which is
implicit in the grant of the power is that it should be in the interest of
administration of justice which may be either that it will not be able to
produced sufficient evidence to sustain the charge or that subsequent
information before prosecution agency would falsify the prosecution
evidence or any other similar circumstances which it is difficult to
predicate as they are dependent entirely on the facts and circumstances
of each case. Nonetheless it is the duty of the Court also to see in
furtherance of justice that the permission is not sought on grounds
extraneous to the interest of justice or that offences which are offences
against the State go unpunished merely because the Government as a
matter of general policy or expediency unconnected with its duty to
prosecute offenders under the law, directs that public prosecutor to
withdraw from the prosecution and the Public Prosecutor merely does so
at its behest”.
67. In case reported as, “(1976) 4 SCC 250”, titled as, “State of Orissa
Vs. Chandrika Mohapatra”, two appeals were decided by a common judgment.
In the first appeal withdrawal was sought on the ground that it would be
inexpedient to proceed with the case and that there was meager evidence
against the accused persons. Trial Court held that the first ground i.e,
inexpedient to prosecute was not a sufficient ground to permit prosecution to
withdraw from the prosecution. However, Trial Court agreed with the public
prosecutor that there was insufficient evidence against the accused persons
and thus granted permission for withdrawal. Hon'ble High Court set aside the
order of the Trial Court. Reversing the order of the Hon'ble High Court and
affirming the order of the Trial Court, in para 6, Hon'ble Supreme Court
observed as under:
xxxxx
“6. It will, therefore, be seen that it is not sufficient for the Public
Prosecutor merely to say that it is not expedient to proceed with the
prosecution. He has to make out some ground which would show that
the prosecution is sought to be withdrawn because inter alia the
prosecution may not be able to produce sufficient evidence to sustain the
charge or that the prosecution does not appear to be well funded or that
there are other circumstances which clearly show that the object of
administration of justice would not be advanced or furthered by going on
with the prosecution. The ultimate guiding consideration must always
be the interest of administration of justice and that is the touchstone on
which the question must be determined whether the prosecution should
be allowed to be withdrawn.”
xxxxx
(Underlining emphasized)
68. Second case was result of a serious rivalry between two trade
unions in an industrial unit. Accused persons were charged for offences under
Sections 147, 148, 149, 307, and 324 of Indian Penal Code. Application for
withdrawal from prosecution of accused persons was filed by the public
prosecutor. Withdrawal was sought on the ground that since the date of
occurrence of the unfortunate incident, there was industrial peace and
harmony and that withdrawal would help maintain cordiality between rival
trade unions. Ld. Sessions Court granted the permission sought for. Hon'ble
Supreme Court upheld that order of the Ld.Session Court. In para 10 of the
judgment, Hon'ble Supreme Court observed as under:
xxxxx
“10. We have already discussed the principles which should govern
cases of this kind where an application is made by the Public Prosecutor
for grant of consent to the withdrawl of prosecution under Section 494 of
the Criminal Procedure Code. We have pointed out that the paramount
consideration in all these cases must be the interest of administration of
justice. No hard and fast rule can be laid down nor can any categories of
cases be defined in which consent should be granted or refused. It must
ultimately depend on the facts and circumstances of each case in the
light of what is necessary in order to promote the ends of justice, because
the objective of every judicial process must be the attainment of justice.
Now, in the present case, the application made by the Public Prosecutor
clearly shows that the incident had arisen out of rivalry between two
trade unions and since the date of the incident calm and peaceful
atmosphere prevailed in the industrial undertaking. In these
circumstances, the State felt that it would not be conducive to the interest
of justice to continue the prosecution against the respondents, since the
prosecution with the possibility of conviction of the respondents would
rouse feelings of bitterness and antagonism and disturb the calm and
peaceful atmosphere prevailing in the industrial undertaking. We
cannot forget that ultimately every offence has a social or economic
cause behind it and if the State feels that the elimination or eradication
of the social or economic cause behind it and if the State feels that the
elimination or eradication of the social or economic cause of the crime
would be better served by not proceeding with prosecution, the State
should clearly be at liberty to withdraw from the prosecution. We are,
therefore, of the view that in the present case the learned Sessions Judge
was right in granting consent to the withdrawal of the prosecution and
the High Court was in error in setting aside the order of the learned
Sessions Judge”.
xxxxx
69. In case reported as, “AIR 1980 SC 1510”, titled as, “Rajender
Kumar Jain Vs. State of Bihar”, 25 accused were charged for offences under
Section 121A, 120B Indian Penal Code read with Section 4,5, and 6 of the
Explosive Act. Application for withdrawal from prosecution was filed.
Withdrawal was sought on the following grounds:
i) Two accused were granted pardon by the Court
and were examined as approver under section 306 Sub
Section 4 Cr.P.C.
ii) That out of 25 accused persons, two accused were
declared proclaimed offenders by the court.
iii) That in public interest and changed
circumstances, the Central Government has desired to
withdraw from the prosecution of all the accused
persons.
Learned Metropolitan Magistrate granted permission for
withdrawl. The Hon'ble Supreme Court affirmed the order of the learned
Metropolitan Magistrate. It was inter alia observed as under:
“13. Thus, from the precedents of this Court; we gather,
1. Under the scheme of the Code prosecution of an offender for a
serious offence is primarily the responsibility of the Executive.
2. The withdrawal from the prosecution is an executive function of
the Public Prosecutor.
3. The discretion to withdraw from the prosecution is that of the
Public Prosecutor and none else, and so, he cannot surrender
that discretion to someone else.
4. The Government may suggest to the Public Prosecutor that he
may withdraw from the prosecution but none can compel him to
do so.
5. The Public Prosecutor may withdraw from the prosecution not
merely on the ground of paucity of evidence but on other
relevant grounds as well in order to further the broad ends of
public justice, public order and peace. The broad ends of public
justice will certainly include appropriate social, economic and,
we add, political purposes Sans Tammany Hall enterprise.
6. The Public Prosecutor is an officer of the Court and responsible
to the Court.
7. The Court performs a supervisory function in granting its
consent to the withdrawal.
8. The Court's duty is not to reappreciate the grounds which led the
Public Prosecutor to request withdrawl from the prosecution but
the consider whether the Public Prosecutor applied his mind as
a free agent, uninfluenced by irrelevant and extraneous
considerations. The Court has a special duty in this regard as it
is the ultimate repository of legislative confidence in granting
or withholding its consent to withdrawal from the
prosecution.
We may add it shall be the duty of the Public Prosecutor to
inform the Court and it shall be the duty of the. Court to appraise itself
of the reasons which prompt the Public Prosecutor to withdraw from the
prosecution. The Court has a responsibility and a stage in
theadministration of criminal justice and so has the Public Prosecutor,
its 'Minister of Justice'. Both have a duty to protect the administration
of criminal justice against possible abuse or misuse by the Executive by
resort to the provisions of Section 321 Criminal Procedure Code. The
independence of the Judiciary requires that once the case has travelled
to the Court, the Court and its officers alone must have control over the
case and decide what is to. be done in each case.
We have referred to the precedents of this Court where it has
been said that paucity of evidence is not the only ground on which the
Public Prosecutor may withdraw from the prosecution. In the past we
have often know how expedient and necessary it is in the public interest
for the Public Prosecutor to withdraw from prosecutions arising out of
mass agitations, communal riots, regional disputes, industrial conflicts,
student unrrest etc. Wherever issues involve the emotions and there is a
surcharge of violence in the atmosphere it has often been fund necessary
to withdraw from prosecutions in order to restore peace, to free the
atmosphere from the surcharge of violence, to bring about a peaceful
settlement of issues and to preserve the calm which may follow the
storm.....
xxxxx
70. In case reported as, “AIR 1983C 194”, titled as, “Sheonandan
Paswan Vs. State of Bihar”, accused persons were charged for offences
under Secion 420, 466, 471, 109, 120 B Indian Peanl Code read with Section 5
(2) of Prevention of Corruption Act withdrawl from prosecution was sought
on following grounds:
i) Lack of prospect of successful prosecution.
ii) Implication of persons as a result of political and
personal vendetta.
iii) Inexpediency of prosecution for reasons of State
and Public Policy.
iv) Adverse affect that continuance of prosecution
will bring on public interest in the light of
changed situation.
Ld. Special Judge granted the permission sought for by the
prosecution. Revision filed by the appellant was dismissed by the Hon'ble
High Court. Majority judgment of the Hon'ble Supreme Court upheld the
order of learned Special Judge. It was interalia observed as under:
xxxxx
“58. The next question' for examination is whether the permission
was given by the Special Judge in violation of law as laid down by this
Court in this regard. We have already referred to the decisions cited by
the appellant. The law laid down by this Court in the series of decisions
referred to above, inter alia, is (1) that the withdrawl from the
prosecution is an executive function of the Public Prosecutor and that
the ultimate decision to withdraw from the prosecution is his ; (2) that
the Government may suggest to the public prosecutor that a particular
case may not be proceeded with, but nobody can compel him to do so ;
(3) that not merely inadequacy of evidence, but other relevant grounds
such as to further the broad ends of public justice, economic and
political; public order and peace are valid grounds for withdrawal. The
exercise of the power to accord or withdraw consent b y the Court is
discretionary. Of course, it has to exercise the discretion judicially. The
exercise of the power of the court is judicial to the extent that the Court,
in according or refusing consent, has to see (i) whether the grounds of
withdrawl are valid; and (ii) whether the application is bona fide or is
collusive. it may be remembered that the order passed by the Court
under Section 321 of the Code, either according or refusing to accord
consent, it not appealable. A mere perusal of the impugned order of the
Special Judge shows that he has applied his mind to the facts of the case
and also applied his mind to the law laid down by this Court in George
Fernandes case that has summarised the entire law on the point, and
correctly applied them to the facts of this case. It is therefore not correct
to say that the decision of the Special Judge was contrary to the law laid
down by this Court.
84..... The only guiding factor which should weigh with the public
prosecutor while moving the application for withdrawal and the court
according its permission for withdrawal is to see whether the interest of
public justice is advanced and the application for withdrawal is not
moved oblique motive unconnected with the vindication of cause of
public justice.
87. The Court while according the consent to the withdrawal has
only to see that the public Prosecutor has acted properly and has not
been actuated by oblique or extraneous considerations. it is not the
function of the Court to make a fresh appraisal of the evidence and
come to its own conclusion on the question whether there is a triable
issue to be investigated by the Court.
xxxxx
71. Earlier decision of the Hon'ble Supreme Court in
“Sheonandan's case (supra)” was examined by a Bench of five Judges.
Majority judgment upheld the earlier decision. It was inter alia observed as
under:
xxxxx
“45.....The judgment of a Public Prosecutor under Section 321 of the
Crimianl P.C 1973 cannot be lightly interfered with unless the Court
comes to the conclusion that he has not applied his mind or that his
decision is not bona fide.
67.....When an application under Section 321 Cr.P.C is made, it is not
necessary for the Court to assess the evidence to discover whether the
case would end in conviction or acquittal. To contend that the Court
when it exercises its limited power of giving consent under Section 321
has to assess the evidence and find out whether the case would end in
acquittal or conviction, would be to rewrite Section 321, Cr.P.C and
would be to concede to the Court a power which the scheme of Section
321 does not contemplate. The acquittal or discharge order under
Section 321 is ot the same as the normal final orders in criminal cases.
The conclusion will not be backed by a detailed discussion of the
evidence in the case of acquittal or absence of prima facie case or
ground lessness in the case of discharge. All that the Court has to see is
whether the application is made in good faith, in the interest of public
policy and justice and not to thwart or stifle the process of law. The
Court, after considering these facts of the case, will have to see whether
the application suffers from such improprieties or illegalities as to cause
manifest injustice if consent is give. In this case, on a reading of the
application for withdrawl, the order of consent and the other attendant
circumstances, I have no hesitation to hold that the application for
withdrawl and the order giving consent were proper and strictly within
the confines of Section 321 Cr.P.C.
70.......The section gives no indication as to the grounds on which the
Public Prosecutor may make the application, or the considerations on
which the Court is to grant its consent. The initiative is that of the
Public Prosecutor and what the Court has to do is only to give its consent
and not to determine any matter judicially. The judicial function implict
in the exercise of the judicial discretion for granting the consent would
normally mean that the Court has to satisfy itself that the executive
function of the Public Prosecutor has not been improperly exercised, or
that it is not an attempt to interfere with the normal course of justice for
illegitimate reasons or purposes.”
xxxxx
72. The gist of entire discussion is that power of Court U/s 321 of
Code of Criminal Procedure 1973 is limited. The judgment of Public
Prosecutor under Section 321 of the Criminal P.C., 1973 cannot be lightly
interfered with unless that Court comes to the conclusion that he has not
applied his mind or that his decision is not bona fide. (As held in the decision
reported as “1998 (1) AD Delhi 561”, titled as, “Govt. of NCT Delhi Vs.
Preet Public Secondary School”.)
73. Therefore, from the scrutiny of the aforesaid judgments, some of
the grounds for withdrawal of criminal case, as recognised by the Hon'ble
Supreme Court can be enumerated as follows:
(i) Broader consideration of public peace;
(ii) Larger consideration of public justice;
(iii) Promotion of long lasting security in a locality;
(iv) Halting of a false vexatious prosecution;
(v) Consideration of public policy;
(vi) Purpose of law and order;
(vii) Advancing social harmony;
(viii) Inexpendiency of prosecution for reasons of State;
(ix) Injustice to accused in case prosecution is continued and;
(x) All other similar and cogent grounds.
74. The above list is illustrative and not exhaustive of the grounds on
which the application U/s 321 Cr.P.C can be made. It is not intended to limit
the considerations on the basis of which the Public Prosecutor can move
application under the said provision.
75. In the light of aforesaid legal position, let me examine the
grounds on the basis of which withdrawal from the prosecution of “Q” has
been sought in the instant case.
76. It may be noted that the FIR in this case was registered on
22.01.1990, whereas the Letter of Intent for supply of Bofors Guns was issued
by Government of India in favour of M/s A.B Bofors on 14.03.1986. As such,
the case has been pending for more than 21 years now and from the date of
alleged contract more than 25 years have elapsed. All the other accused
persons, except “Q” have either died or proceedings against them have been
“quashed”, including the proceedings against M/s A.B Bofors.
77. The Hon'ble High Court of Delhi in judgment dated 04.02.2004
in Crl.Misc. Case No.492/2003, went into the details of the contract, the
aspect of conspiracy, the nonjustifiability of the case against public servants
as also the utility of Bofors Guns in detail. I do not wish to go into the matter
from the aforesaid angles. However, I wish to quote some important
observations of the Hon'ble High Court in the aforesaid judgment, which hold
the field and are decisive for the consideration on this application.
78. I would like to quote some important paragraphs of the judgment
of Hon'ble High Court of Delhi, dated 04.02.2004, passed in Crl.Misc. Case
No.492/2003, which are as under:
xxxxx
6. Result of thirteen long years of investigation by the CBI, a
premier Investigating Agency of the Country and three years
investigative jounalism during which period large number of officers
of CBI hopped to foreign countries every now and then to collect the
evidence against public servants but returned empty handed as till
date there is no evidence to show that public servants had taken bribe
in awarding the contract of guns to M/s. A.B Bofors & Co. either
themselves or through Bofors's agents though it has succeeded in
tracing the Swiss accounts of “Commission Agents” employed by M/s
A.B. Bofors wherein illegal payments received by them from Bofors as
commission were deposited.
7. This case is a nefarious example which manifestly demonstrates
how the trial and justice by media can cause irreparable, irreversible
and incalculable harm to the reputation of a person and shunning of
his family, relatives and friends by the society. He is ostracised,
humiliated and convicted without trial. All this puts at grave risk due
administration of justice.
8. It is common knowledge that such trials and investigative
journalism and publicity of premature, half baked or even presumptive
facets of investigation either by the media itself or at the instance of
Investigating Agency has almost become a daily occurrence whether by
electronic media, radio or press. They chase some wrong doer, publish
material about him little realizing the peril it may cause as it involves
substantial risk to the fairness of the trial. Unfortunately we are getting
used to it.
9. Latest trend of police or CBI OR Investigating Agency
encouraging publicity by holding press conference and accompanying
journalists and television crew during investigation of a crime needs to
be stopped as it creates risk of prejudice to the accused. After hogging
publicity and holding the person guilty in the eyes of public, police and
CBI to into soporofic slumber and take years in filing the charge sheet
and thereafter several years are taken in the trial.
10. It is said and to great extent correctly that through media
publicity those who know about the incident may come forward with
information, it prevents perjury by placing witnesses under public gaze
and it reduces crime through the public expression of disapproval for
crime and last but not the least it promotes the public discussion of
important issues. All this is done in the interest of freedom of
communication and right of information little realizing that right to a
fair trial is equally valuable. Such a right has been emphatically
recognized by the European Court of Human Rights.
“Again it cannot be excluded that the public becoming
accustomed to the regular spectacle of pseudo trials in the news media
might in the long run have nefarious consequences for the acceptance
of the courts as the proper forum for the settlement of legal disputes.”
11. There is nothing more incumbent upon courts of justice than to
preserve their proceedings from being misrepresented than to prejudice
the minds of the public against persons concerned before the cause is
finally heard. The streams of justice have to be kept clear and pure.
The parties have to proceed with safety both to themselves and their
character.
12. The fairness of trial is of paramount importance as without
such protection there would be trial by media which no civilised society
can and should tolerate. The functions of the court in the civilised
society cannot be usurped by any other authority. I feel tempted to
quote the words of wisdom of Chief justice Lord Taylor as to the impact
upon the victim of a press campaign.
“We would lime to stress that, whilst the press are the
guardians of the public interest, to pursue a campaign of vilification of
someone who has been before the court, in a way which causes hate
mail to be sent, which causes his family to be under the need to move
house, which causes his children to be shunned by other children in the
neighbourhood, is doing no public service. Furthermore, if it is
intended to bring pressure to bear on the courts, then it is wholly
misguided.”
80. Similarly Quattrocchi also held the money in his own account
and had been transferring part of monies in different accounts
opened by him. To allow the imagination to fly that AB Bofors paid
bribe to public servants through Hindujas, Chadha and Quattrocchi
to get the contract and in return they held the amount of alleged
“commission” paid by AB Bofors as a trust for more than a year or
so is nothing but to deceive oneself. This itself rends the CBI's case
from foundation to cornice.
81. Had element of 'bribe' been involved in awarding the contract,
the need for involving three agents would not have arisen. Was money
of bribe being divided in three parts through three different persons.
The question arises as to who succeeded in getting the contract.
Hindujas or Quattrocchi or Chadha. In this case all the three. What an
inference! CBI was right in not including the offence of taking bribe
either by the public servants or Hindujas, Quattrochi having held the
monies received by them from Bofors as a trustee for public servants
as it was not equipped with any material or evidence nor did it obtain
sanction for this offence which is punishable under Section 161 IPC.
84. Having failed to lay hand upon any kind of evidence as to
payment of illegal gratification to public servants or holding the
monies received by the Agents as trustee, CBI like a drowning person
clutched a flimsy straw by introducing the doctrine of “misusing an
official position” by way of inducting even an element of “conspiracy”
which is unknown to such a penal offence purely on the conjectural and
inferential premise that by hastening the decision in favour of Bofors
and without considering the offer of a rival viz. “Sofma” that too made
subsequent to the letter of intent was issued in favour of Bofors the
public persons had misused their official position.
85. On the face of it such a theory is difficult to ram down the
throat for the simple reason that when the contenders were short listed
and called upon to give the undertaking that they would neither involve
Indian agents nor would pay commission to them and would rather
reduce the price by the corresponding amount of commission they
would even otherwise have paid to their Agents they requoted their
reduced price and Price Negotiating Committee comprising of several
members though headed by late S.K. Bhatnagar had no other option
than to decide in favour of Bofors whose gun had not only edge over as
to its quality and peculiar feature of “shoot and scoot” but at relevant
time cheaper in price also. It was after Letter of Intent (LOI) was
issued that “Sofma” woke up and like a loosing gambler offer to
reduce the price further. Though it was too late yet the price in terms of
money was higher as Bofors scaled down its height by offering ten guns
free.
86. Let us assume that “Sofma” price was cheaper though reduced
when the stage was over, still the Expert Committee's opinion as to the
preference of Bofors could not and ought not have been ignored even if
it was little costlier. Security of a nation cannot be jeopardised for a
few bucks here or there. Life of a soldier is more precious and cannot
be bartered like this. By no stretch of imagination such a decision can
be termed either as hasty decision as the material exercise took more
than a year or tainted decision as element of illegal gratification is not
only utterly wanting but has also not been alleged by the CBI and
rightly so as not a shred of evidence has surfaced uptil this day.
87. If decision making authorities be in any field are prosecuted
like this, no authority, no person would take decision nor would dare to
take decision. However, it does not mean that the element of illegal
gratification cannot exist in deserving cases. Possibility of procuring
award of even of well deserving contract through illegal gratification to
be persons involved for taking decision cannot be ruled out. Offence of
giving or taking illegal gratification is independent of all such
considerations. But the condition is that like any other offence, offence
of “illegal gratification” has to be proved by way of evidence even if it
gives rise to “strong suspicion” because of available material in trying
a person for this offence. As has been observed above not even a trace
of evidence has surfaced inspite of stupendous efforts made by CBI
whose officers sojourned to Switzerland and other countries for several
years to dig out the material but all in vain.
95. It is clear from the evidence that the user of the armament
namely the Army had the ultimate decisive voice and therefore
allegation of selecting a less qualitative and more expensive has no
basis. It was the technically expert opinion of the Army that the
Government should go for Bofors' because of its peculiar feature of
“shoot and scoot”. None of the public servants had any role in
selecting the gun.
96. After 17.2.1986 when the Army indicated its choice, finally
through Deputy Chief of Staff who was member of the Technical
Committee and expressed its stand that even if Bofors gun is costlier,
that is the gun which the Army wants, it was obvious that if the army
changed its mind in favour of Bofors, it did not do so because of
intervention of public servants or Bofors or present petitioners or
Quattrochi or Win Chadha. It was purely an opinion by a body of
experts.
97. The element of illegal gratification as envisaged under Sections
161 is according to the prosecution case itself utterly wanting inasmuch
as that there is no evidence that the official report of the Army in
favour of Bofors was managed, manipulated or procured through
corrupt or illegal means. Since the best judge of the weapons to be used
by the Government is the Army or its Committee or Technical Experts
the Government had no business or role to overrule that decision.
However, the Price Negotiating Committee had a limited role of
negotiating the price acting on the premise of the report of the Army
which gave its report on 17th February, 1986 to the effect that Swedish
Bofors has a clear edge over the French Sofma. The report was
submitted by the Deputy Chief of the Army Staff which was approved
finally by the Chief of the Army Staff.
98. Unless there is a corrupt motive imputed to the choice in favour
of one Gun or the other even if it is costlier price wise but quality wise
equally good though Bofors had an edge over Sofma because of its
peculiar feature of “shoot and scoot” the offnece under section 161
IPC does not attract and nowhere the prosecution has levelled these
allegations nor has produced any material in support of corrupt
motives. Merely because the Sofma's offer of reducing the price came
immediately after the letter of intent had already been issued to Bofors
cannot lead to any inference that the decision in favour of the Bofors
was with ulterior motives or by accepting bribe etc.
99. It is not the case of CBI that Bofors or Hindujas or Quattrochi
or Chadha had accepted the bribe money on behalf of the public
servants under the garb of “commission” and that the bribe money
allegedly paid by the Bofors was retained by Hindujas or others as
custodians. Until and unless the money in the account of Hindujas and
others is related to the bribe money to the public servants, charge for
abetting in receiving the bribe punishable under section 161 read with
section 165A IPC cannot stand or stick.
107. The only argument of the CBI is that presumption should be
drawn that the haste with which the contract was awarded was a result
of the conspiracy between Hindujas, Quattrocchi, Bofors and the public
servants to award contract in favour of Bofors prior to the visit of Rajiv
Gandhi to Switzerland. The prosecution has not brought anything on
record as to what different role was played by the members of the
Negotiating Committee than the role played by Mr. Bhatnagar. Thus,
the element of dishonest intention is utterly wanting.
110. ......Even otherwise in commercial contracts of Defence
matters political and diplomatic considerations play a part, other
thing being equally important. France was also a supplier of arms to
Pakistan. In case of need the supply of Sofma could have squeezed.
111. So far as the allegations that Sh. Rajiv Gandhi requested the
Swedish Prime Minister to desist from holding an enquiry in April,
1997 it is of no significance as it was done on account of a decision
taken by the Cabinet Committee of Political Affairs after deliberating
the issue that since the Joint Parliamentary Committee was going to
enquire into the matter it would be not proper for officers of the
Ministry to meet the Bofors's Officers. As regards the haste in issuing
the letter of intent though there was no cut off date for the price
negotiating committee but still Mr. Bhatnagar informed Mr. Arun Singh
about the offer of Sofma after the issuance of letter of intent, Mr. Arun
Singh felt that issuance of letter of intent should not come in the way of
consideration of offer of Sofma and it was on his advice that Bofors
was asked to revise its offer and once the Bofors agreed to give 10 guns
free its price got reduced from that of Sofma. It was only after 12 days
ie. On 24th March, 1986 that the contract was signed with M/s AB
Bofors. So far a General Sunderji' plea for cancellation of the contract
is concerned it was on the moral ground and not from commercial or
technical aspects.
123. The contract was awarded after series of meetings detailed
discussions on every aspect including technical, financial and
contractual between the manufacturers and the working groups
constituted by the price negotiating committee. But act of
misrepresentation about commission agents and proportionate
reduction in price amounts to not only deception but fraudulently or
dishonestly inducing the Government of India to do an act that caused
wrongful loss to the tune of Rs.100 Crores or so as the agreed
commission amounted to the said amount though by the time news
broke Rupees 64 crores had been paid and such an act does come
within the mischief of Section 120B and Section 420 ICP qua the
petitioners and for that purpose Martin Ardbo and Quattrocchi.
xxxxx
(Emphasis supplied)
79. Further, in judgment dated 31.05.2005 in Crl. Revision No.
273/2004, the Hon'ble High Court considered the effect of the copies of the
documents received by CBI pursuant to the execution of Letter Rogatories,
issued by this court in this matter, which are as under:
xxxxx
33 . The disputed photo copies do not qualify as certified copies for
the following reasons :
(a) That the Ministry of Justice does not claim to have original in
its possession.
(b) The officer who has initialed them neither had nor even claims
the custody of the originals.
(c) There is no certificate written at the foot of the copy that it is
true copy of any other document.
(d) There is no date and there is no name and official title of the
officer.
(e) There is, however, a seal of the Ministry of Justice of which I
cannot take judicial notice;
39. The words “6(9)/84/D(GS.IV) av 860324 and 6(9)/84/D
(GS.IV) av 860324” are in the handwriting of somebody. Unless the
person who wrote those words is identified and it is proved that his
position is such that his writing those words proves the truth of the
contents, the documents are utterly useless. Based on this dubious
material, to allow a prosecution to go on for many more years, in
respect of a transaction of more than 20 years vintage, is sheer
persecution, waste of public time and money. I cannot foresee any
chance of the successful termination of such a useless prosecution. It
was for this reason, I thought of giving the CBI an opportunity to bring
the case back on rails. As already noted, the CBI has spurned the offer.
48. Evidence collected during the investigation must be
capable of being converted into evidence as defined in the Evidence
Act. No material exists on the record which will bring about this result.
The word 'evidence' in Section 166A is used in the general sense of
something which may have some probative value if capable of being
converted into evidence as defined in the Evidence Act. It is fallacious
to treat it as evidence for the purpose of the eventful trial.
49. Section 166A is available only where some documents are
collected from abroad during the course of the pending investigation.
The investigation was over when the second chargesheet was filed on
90.10.2000. These documents were received sometime after the
16.08.2001.
56. Let me again summarise. If these documents have come from
the Department of Justice, these documents will be private documents
which form the record of public officers of a foreign country in which
event they are 'public documents' as defined in Section 74(1) (iii) of the
Indian Evidence Act. They can be proved only under Section 78 clause
(6) of the Indian Evidence Act. It is not denied that no such
authentication exists in respect of these documents. Under the
circumstances, these documents can never be proved.
57. If I assume that these documents are not 'public documents' at
all as defined in the Evidence Act but private 'documents' then they
have to be proved like any other document. Not only their execution has
to be proved but the truth of the contents of the documents has to be
proved. No such material exists to prove these as 'private documents'.
61. The CBI failed to produce the original documents. The Bofors
Company thereafter on 09.03.2004 moved another application for
direction that the prosecution must produce the original documents for
inspection to avoid any further delay in the trial. Another similar
application was filed on 25.03.2004. During pendency of this
application, the learned Magistrate on 26.03.2004 proceeded to frame
charge against the Bofors Company for offence punishable under
section 465 IPC since the learned Magistrate was bound to do so by the
directions in order dated 04.02.2004 of Kapoor, J. The Bofors
Company moved yet another application on 07.06.2004 for production
of the original documents for inspection and for preparation of its
defence before the trial began, but no original documents were
produced. However, on 14.10.2004, the learned Additional Solicitor
General appearing on behalf of the prosecution, made a statement
before the learned Magistrate to the effect “that the original documents
sought to be perused by the Bofors Company are not available with the
CBI.” This statement was incorporated in the order dated 14.10.2004 of
the learned Magistrate.
62. Faced with the aforesaid situation, the learned Magistrate
directed the prosecution agency to ascertain whether the original
documents were/are lying with the Swedish Authorities which was
sought to be kept secured by an earlier order. The learned Additional
Solicitor General submitted a fax communication dated 24.11.2004
from the Ministry of Justice, Sweden, which reads as under :
“I hereby certify that all original documents received from the
prosecutor's office were forwarded to the Embassy of India in
Stockholm. These documents were subsequently stamped and signed at
the request of Indian Authorities.”
63. An additional list of witnesses, particularly PW94, PW95,
PW96 and PW97 with the note “Statements of aforesaid witnesses
have not been recorded as they are formal witnesses for handing over
of documents etc.” was filed.
64. On the basis of the aforementioned submissions, counsel
submitted that it has been established that the CBI are not in a position
to produce the original documents in question in court nor are they in a
position to inform the whereabouts of the originals in which case
forgery cannot be profed nor a charge under Section 465 IPC be
sustained.
65. Counsel seeks to rely upon the arguments made in the Hinduja
Brothers' case as to the veracity of proceedings in the trial in the
absence of certified copies or originals of the documents alleged to
have been forged. The learned Additional Solicitor General has chosen
not to address arguments in the case advanced by the Bofors Company
since, according to him, question of law and admissibility of xerox
copies is common and would govern both the cases. The question of
law having been discussed in the preceding paragraphs of this
judgment, the conclusion is but obvious.
66. Before parting, I must express my disapproval at the
Investigation that went on for 14 years and I was given to understand
that it cost the Exchequer nearly Rupees 250 crores. During the
investigation a huge bubble was created with the aid of the media,
which, however, when tested by court, burst leaving behind a disastrous
trail of suffering . The accused suffered emotionally. Careers both
political and professional were ruined besides causing huge economic
loss. Many an accused lived and died with a stigma. It is hoped that
this elite Investigating Agency will be more responsible in future ...........
xxxxx
(Emphasis supplied)
80. From the joint reading of the aforesaid two judgments, which are
binding precedent upon this court, with regard to the facts as also the law
applicable in the matter, would reveal that despite spending through its nose
for about 21 years, the CBI has not been able to put forward legally
sustainable evidence with regard to conspiracy in the matter. Further in
case of “Q”, as against the alleged kickback of Rs.64.00 Crores, the CBI by
the year 2005 had already spent around Rs.250.00 Crores on the
investigation, which is sheer wastage of public money.
81. While we are busy in discussing the Sensex and scams, India's
poorest are barely surviving, thanks to an appalling governance deficit. In
some areas of our country, we have no electricity, no roads, no proper water
facilities; 50% of India lives on less than US $ 2 a day; 100 million childen go
to bed hungry every night; 62% live without electricity and in some of the
areas, the villages are another heart of India's darkness. At various other
places, there are no shops, no dispensaries and merely there is an apology of
an Anganwadi; a school so unsafe that the children study on its open
verandah. There are little scrubs of farmlands where “tuar and chana”
plants precariously survive. The village lives in darkness; its children are
taught to play in the dark. Food is cooked during the day, eaten by the light
of a kerosene lamp, carefully set at its lowest flame, at night. To save
kerosene, 10 minutes is all they get to finish dinner. The nearest medical
facility is 30 KM away. Pregnant women prefer to give birth in their huts
rather than travel two hours on the bumpy dirt track to the nearest public
health centre. They know the journey can lead to a hamorrhage and death,
like it happened to those women who insisted on travelling to the nearest
health centre. This situation has been the same in some parts of the country
since 1947. Above are the views expressed by an author in respect of
“Rehatyakheda village” in Amravati District, Maharashtra. I presume, the
conditions in various other parts in India are somewhat similar or even worse.
It is common knowledge that farmers in some places in India are committing
suicides because they do not find it easy to have one meal a day, what to talk
of availability of other civil amenities which are required for the existence of
human being in a dignified manner. The very question which stares us at our
faces is whether it is justified for the Government of India (CBI) to continue
to spend on the extradition of “Q”, which may or may not ultimately happen
during his lifetime. Can we allow this hard earned money of “Aam Aadmi”
of India to be spent on these type of proceedings which are not going to do
any good to them, after almost 25 years of the so called “Arm Deal”. The
answer would be a big “NO”. From the contents of the application, I find that
the learned Prosecutor has applied his independent mind on this aspect and
has chosen to treat it as one of the grounds for withdrawal of prosecution
against “Q” and the same is clearly in larger public interest.
82. The other ground taken is that two earlier attempts of CBI in
extraditing “Q”, one in Malaysia and other in Argentina have failed. I have
gone through the judgments passed by the Malaysian Courts as also by the
Argentian Courts.
ORDERS OF MALAYSIAN COURTS
The order of the Kualalampur Sessions Court, Malaysia inter alia
observed as under :
“ In the final analysis it is my decision that a proper description of the
offences committed by the subject have to be tendered in Court. The
failure to do so amounts to noncompliance of the Law. I will go as far
as to say under such circumstances the tendering of charges would have
been preferable. Further, it is my observation that the burden lies with
the requesting countries to produce this description of the offences as
they are in the best position to know the exact offences committed if any
by the subject.
I am directing that the subject be discharged of this extradition
proceeding upon which his bail and all condition attached to the bail
be also discharged.
The matter then went up the Court of Datuk Augustine Paul,
Judge, High Court, Kuala Lumpur who delivered his judgment on 13 th
December, 2002 and upheld the lower court's Judgment. It is relevant
to note that the Ld. Judge examined the evidence produced by the CBI
to find out if an offence of cheating was prima facie made out. The
following is quoted from the judgment of Datur Augustine Paul—
xxxxx
I will first deal with the offence of cheating. The thrust of this offence is
the receipt of money by the Respondent following the appointment of
AE Services Limited of the United Kingdom at this behest as the
consultants of Bofors since the appointment of agents was prohibited.
However, it must be observed that paragraph 13 of the “chargesheet”
of the Indian authorities refer to the prohibition as“the present
Government did not approve of the appointment of Indian agent acting
for foreign supplies.”
The prohibition is therefore only of the appointment of Indian agents.
As AE Services Limited is United Kingdombases their appointment
as consultant to Bofors does not infringe the prohibition. In any
event, clause 33.1 of the agreement entered into between the
Government of India and Bofors some two weeks after the imposition
of the prohibition has the effect of negating it. It reads as follows :
“All the provisions of this Contract including the Annexures,
Enclosures and Clauses shall be harmoniously construed. The Parties
have executed this Contract on the basis that the provision in the
Clauses and Annexures both inclusive represent the entire Contract.
This Contract sets forth the entire undertaking of the Parties in respect
of transactions contemplated hereby and supersedes all prior
agreements, arrangements, representations or undertaking relating to
the subject matter thereof.”
If the prohibition has been superseded by the agreement it ceases to be
one. It cannot therefore be the foundation for the offence of cheating.
“The two issues that I have mentioned, having been addressed by
learned counsel for the Respondent, did not find their way into the
reply by the prosecution. When I invited the prosecution and the two
counsel to submit on them there was no positive response worthy of
consideration. These facts cannot therefore be termed or treated as
particulars for the offence of cheating in lieu of a charge therefore. In
the circumstances it is not possible to discern the particulars for the
offence of cheating from the documents made available.”
The Malaysian High Court held as under:
“Without the charges or , in the alternative, proper particulars of the
offences the inquiry before the Sessions Court just could not have
started. In the upshot it is my view that failure to supply the Court and
the Respondent with the charges is fatal. The ruling made by the
learned Sessions Court Judge on the preliminary objection raised by
the Respondent is therefore correct in law. Accordingly, I confirm the
order of discharge made by him and dismiss this application...”
st
Finally, the judgment of the Federal Court of Malaysia on 31 March,

2004. The concluding paragraph No.97 is quoted :
97. “All things considered, we can only conclude that we are in
agreement with the Court of Appeal on its findings. We would,
therefore, hold that no appear lies to this court. As such, we decline to
make any ruling on the subsidiary issues raised in the arguments.
Accordingly, we dismiss the appeal with costs.”
83. The Court of First Instance of Eldorado (Argentina) in its
judgment dated 12.09.2007 held the extradition proceedings to be for political
reasons. The learned Judge specifically stated that the investigation in the
matter was conducted after the political party of the former Defence Minister
of India and Prime Minister Shri Rajiv Gandhi could not form a Government
in the general elections and the charges were recorded hastily after the new
Government took office and used the “Bofors” case as a weapon by the
political parties during the general elections of the country.
84. The learned Judge quoted with approval an earlier precendent in
the matter to brand the extradition of “Q” sought for by the Government of
India, as political persecution. In the words of Judge:
“Political persecution implies to assert, tacitly, that the requesting State
would be using maliciously the extradition figure to obtain an illegal
banishment, assertion which cannot be hasted and without the court
fully believing of the existence of a concealed intention”.
85. It was very vehemently argued by the learned Additional
Solicitor General of India that the Red Corner Notice was withdrawn against
“Q”, after the approval of Attorney General of India, as it was impinging very
heavily upon the exchequer. A joint reading of the judgments of both the
countries would reveal that on facts of case, both the countries expressed that
offence of conspiracy and cheating was not made out against “Q”, as the
terms of the agreement between the Government of India and M/s A.B Bofors
did not prohibit the induction of foreign agents in the contract and in any case,
if there was a violation of any term of contract, that only leads to civil
consequences and not penal consequences.
86. The learned Additional Solicitor General emphasized that in
future no other country would allow the extradition application of
Government of India because of aforesaid two precedents of two different
countries, who at the time of considering extradition applications considered
the merits of the case as well. He has further submitted that if the proceedings
are allowed to continue on an unending note, then that would only amount to
continuation of charge on the exchequer with no hope of any fruitful result
being produced in the matter. On this account also, I find that the learned
Special Prosecutor has applied his independent mind and considered the
matter on the aforesaid lines.
87. Therefore, the decision of the learned Special Prosecutor of CBI,
seeking withdrawal of prosecution against “Q” on the face of it appears to be
bonafide and in the larger public interest. Accordingly, the learned Special
Prosecutor of CBI is allowed to withdraw prosecution against “Q”.
Consequently, “Q” stands discharged from this case.
88. File be consigned to Record Room after complying with the
necessary formalities and after expiry of the limitation period of challenging
this order by any of the parties, the record be sent back to the Hon'ble
Supreme Court of India.
Announced in the open court (Vinod Yadav)
on 04.03.2011 Chief Metropolitan Magistrate:
Delhi

Bofors Order-Ottavio Quattrocchi Order

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Bofors Order-Ottavio Quattrocchi Order

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RC No.1(A)/90 (“CBI V/s Ottavio Quattrocchi”) DOD: 04.03.

by learned Special Public Prosecutor of CBI, Shri U.S Prasad, seeking

“Nirdhan Nishulk Kanooni Sahayata Samiti”) (hereinafter referred to as

of justice, this court permitted “Aggarwal” and “Gupta” to advance

5. The Indian defense purchase policy, till 1984, allowed foreign

details of their Indian agents, if any, to the Government, in a prescribed

and M/s Voest Alpine (Germany). These bidders had furnished the

7. M/s Bofors of Sweden also, in its declaration dated May 19,

apart from W.N. Chadha, Hersh W. Chadha, Marketing Director of M/s

Anatronic General Corporation, B.B. Bhatnagar (retired) and Brig. A.L.

of letters, telexes, etc., were using a local firm, Anatronic General

9. Be that as it may, on March 24, 1986, a contract number

Minister, for supplying four hundred FH 77­B systems along with vehicles,

ammunition and other accessories, at a total cost of SEK 8,410,660,984

by Anders G. Cariberg, president and Chief Executive Officer of Nobel

30 days from presentation by the seller, i.e. M/s Bofors, of an advance

payment guarantee. On receipt of the advance payment guarantee from

Bofors on April 7, 1986, the advance payment of SEK 1,682,132,196.80

contract was not awarded by the Govt. of India to Bofors. Thus, M/s AE

letter dated 10.03.1986, addressed to the Ministry of Defense, in terms of

Tweedale Scott, Director of M/s. AE Services Limited, sometime before

Accountant by profession, working with M/s. Snamprogetti, an Italian

multinational company (MNC) providing the services of designing,

sector of oil refineries, gas processing, petrochemicals, fertilizers and

20. It emerged that after payment of SEK 1,682,132,196.80 (Rs.

(equivalent to US $ 7,343,941.98), on September 03, 1986, to A/c No.

18051­53 of M/s AE Services Limited at Nordfinanz Bank, Zurich. This

Stott as its Director. This amount of SEK.50,463, 966.00 works out to be

on September 29, 1986) to Account No.254.561.60W of M/s. Colbar

Investment Limited Inc., Panama with the Union Bank of Switzerland,

Account No.488.320.60 X of M/s. Wetelsen Overseas, SA with the Union

These Accounts of M/s. Colbar Investments Limited Inc., as well as M/s.

entire money, i.e. US $ 9.2 million, was further channeled to various

in Guernsey. Letters Rogatory were issued by the Court of Special Judge,

another consultancy agreement with an entity incorporated in Panama,

25. Letters Rogatory were issued by the Court of Special Judge,

Delhi to Switzerland, Sweden, Panama, Luxembourg, Bahamas, Jordan,

28. Inquiries further revealed that, including the above payments,

Inc. Panama, for the said deal with the Government of India, which were

$160,000. For the said Account, Mr. W.N. Chadha had given a Powers of

30. The advance payment of SEK 1,682,132,196.80 (Rs.296.15

S. No. Date Particulars

S. No. Date Particulars

15. January, 1986 Mr. W.N. Chadha signed an Administrative Consultancy

S. No. Date Particulars

information, certain facts and circumstances that became available, media

period between 1982­87, certain public servants entered into a criminal

pursuance thereto committed offence of bribery, cheating, swindling and

forgery, in respect of a contract dated 24.03.1986, entered between

vehicles and ammunition by AB Bofors to Government of India. A

percentage of said amount of contract was remitted by AB Bofors in a

purpose. In part execution of letter rogatory, the Swedish authorities had

made available copies of certain documents, duly authenticated, which

revealed that the amount credited in the account of M/s AE Services was

Coalbar Investment Limited Inc., Union Bank of Switzerland, Geneva,

instructions to the account of M/s Wetelson Overseas, S.A of Panama on

of International Investments Development Company, in Ansbacher (CI)

Services and others were intended to mascuard the ill­gotten payment/

he left India abruptly in July' 1993. As such, a strong suspicion of his

Bofors and thereafter on 09.10.2000 supplementary chargesheet was filed

34. On the directions of CBI, a Red Corner Notice, bearing No.

having entered into a criminal conspiracy with the public servants to

April, 1985 to March, 1986 to cheat the Government of India by

fraudulently and dishonestly representing that there were no agents

Minister, for supplying four hundred FH 77B systems along with vehicles,

1805153 of M/s AE Services Limited at Nordfinanz Bank, Zurich. This

period between 198287, certain public servants entered into a criminal

Services and others were intended to mascuard the illgotten payment/

No.RC1(A)/90ACIIV/SIG/New Delhi and discharge them from the

(b) That all other coaccused have either died or proceedings

prohibition for employment or nonemployment of Indian or foreign

to have “locusstandi” to oppose this application before this court,

petition taking view that he had no “locusstandi”, whereafter he filed a

held that in such a case, the complainant had no “locusstandi” to

“Finally there is a deeper and indeed a fundamental reason for non

be commendable, but we are of opinion that it gives him no “locus

applicant has no “locusstandi” to be heard by counsel. We also

not valid grounds to have “locusstandi”. However, this Court is really