LexMANOHAR LAL SHARMA versus CENTRAL BUREAU OF INVESTIGATION & ORS.
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A B [2017] 10 S.C.R. 562 MANOHAR LAL SHARMA v. CENTRAL BUREAU OF INVESTIGATION & ORS. (Wnt Petition (Crl.) No.65 of20 I 6) OCTOBER09,2017 [ADARSH KUMAR GOEL AND UDAY UMESH LALIT, JJ.]. Panama Paper Leaks Case- Tax evasion by some individuals/ entities by way of offshore bank accounts/business - Petitioner C sought direction to the CBI to conduct an investigation/inquiry against the Indian offshore bank account holders, revealed in "Panama Papers" and further to register FIR and conduct investigation against Securities and Exchange Board of India (SEBI) Chairman, his associate directors, share brokers and companies - D Averments made in the Petition that "Panama Paper Leaks" report (information relating to tax evasion by some individuals/entities posted on a website) were not acted upon by the concerned authorities, particularly SEEi resulting in seriousfinancial loss to the general public and protection of black money hoarders - Held: E In instant case, the Special Investigation Team(SIT) has already been constituted under the orders of the Supreme Court - The terms of reference of the SIT covers the subject matter of this petition which is also clear from the notification issued by the Ministry of Finance - Further, the Government of India, Department of Revenue vide office memorandum has constituted Multi Agency Group(MAG) to F go into issues arising out of "Panama Papers" - Reports of MAG to be submitted to the SIT and MAG to carry out any direction which SIT or Supreme Court may give in tlie other pending writpetition being WP(C) No.176 of 2009 - Writ petition disposed of - Prevention of Money Laundering Act, 2002 (PMLA, 2002) - G Unlawful Activities (Prevention) Act, 1967 (UAPA, 1967)-s.51A- SEBI (Foreign Portfolio Investors) Regulations, 2014 (FPI Regulations) H Public Interest Litigation - Scope of- Held: Public Interest Litigation is a mechanism by which Court can initiate action for 562 MANOHARLALSHARMA v. CENTRALBUREAUOF 563 INVESTIGATION & ORS. protection of rights of public on account of inaction of any public .A authority or to oversee any abuse of power by the public authority-At the same time, the PJL weapon is to be used with great. caution keeping in mind the fact that governance is the basicfanction of the Executive - Unless there is a clear abuse of power or.failure of governance, the Court may not interfere. B CRIMINAL ORIGINAL JURISDICTION : Writ Petition (Criminal)No.65 OF2016 Under Article 32 of the Constitution oflndia. WITH· S.L.P. (Civil) No.13908of2016. Atul Babasaheb Dakh, Adv. for the Petitioner. Petitioner-in-person. c ChanderUday Singh, P. S. Narasimha, Ms.A.shaR. S., Mrs.Anil D Katiyar, K. Parameshwar, Rishi Gaulam, Bhargava V. Desai,Akshat Malpani, Ms. Meenakshi G., Rajat Nair, Ritin Rai, Mukesh Kumar Maroria, H. S. Parihar, Ad vs. for the Respondents. The following Order of the Court was delivered: ORDER~· WRIT PETITION (CRL.) NO. 65 OF 2016 E 1. This petition seeks a direction to the CBI to conduct an investigation/inquiry against the Indian offshore bank account holders, . revealed in "Panama Papers", and to file their report before this Hon'ble F Court. Direction has also been sought to register FIR and conduct investigation against the Securities and Exchange Board of India (SEBI) Chairman, his associate directors, share brokers and companies . . 2. Averments in the petition are that "Panama Paper Leaks" report G (which refers to information relating to tax evasion by some individuals/ entities by way of offshore bank accounts/business to evade tax. International .Consortium oflnvestigation Journalists (ICU) posted the documents on its website.) have not been acted upon by the concerned authorities, particularly the SEBI resulting in serious financial loss to the H 564 SUPREME COURT REPORTS [2017] 10 S.C.R. A general public and protection ofblackmoney hoarders. Reference has been made to certain individuals who are said to be having offshore undisclosed bank accounts and who have manipulated the capital market. It is alle_ged that the SEBI has failed to perform its functions as capital market regulatory. The black money kept in foreign accounts can be B used to facilitate terrorism, money laundering, tax evasion, corruption, crimes etc. Funds of the offshore accounts are circulated in Indian stock market via participatory notes. The Special Investigation Team(SIT) on black money constituted by t
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