LexR. SAI BHARATHI versus J. JAYALALITHA AND ORS.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
R. SAi BH1}~.A THI
A
v.
J. JAY ALALITHA AND ORS.
NOVEMBER 24, 2003
[S. RAJENDRA BABU AND P. VENKA T ARAMA REDDI, JJ.]
B
Penal Code, 1860/Preventian of Corruption Act, 1288:::-Sections
l 20B, 169 and 409/Sections l3(l)(c) and (d) and 13(2)-Prosecution
under-Corporation-Owning Government Campanies-Ai;ticles of
Association of Corporation provided sale of the property only after C
approval fi·om Government-Property sold by Cmporation in publ(c
interest by way of open tender-Purchased by the firm of the accused who
was Chief Minister of the State and her associate-Code of conduct
refraining the Ministers from buying such property-.Bid of the accused
was highest and above the market value ascertained by the other two D
accused-the Government Officials-Complaint against the accused alleging
that ,the sale caused wrongful gain to the firms of accused and lvrongful
loss to the Corporation-Conviction of accused u/ss.120-B and 409/PC
and 13(l)(c) and (d) and 13(2) of the Act-Acquittal by High Court-On
appeal, held: Property cannot be said to be under-sold causing loss to the E
Corporation, the sale having been conducted by open tender, the bid being
highest and above market value and the process of tender not having been
vitiated-Offence u/s.120-B not established in the facts of the case-
Section 3(J){d) not attracted because property was not purchased by
accused by corrupt or illegal means for her pecuniary gain by discarding F
public interest-Section 3(J){c) not attracted as the accused did not act
dishonestly or fraudulently-Corpo~ation being a separate entity from the
Government the property thereof ccmnot be said to be entrusted to the
Government creating a trust a.~ the Government had no domination over
it and dishonest disposal or conversion of property not having been G
established Section 409 not attracted-Offence u/s 169 also not made out
as purchase of the property in question was not prohibited by any statute
but only by a Code of Conduct-Code of Conduct not having any statutory
force, not enforceable in Court of Law and the same having· only e.(hical
effect, cannot be construed to impose a legal prohibition-Accused H
85
86
SUPREME COURT REPORTS [2003] SUPP. 6 S.C.R.
A directed to return the property unconditionally in keeping with good ethical
behaviour.
State of Tamil Nadu formed Tamil Nadu Small Industries Cor-
poration Ltd. (T ANSI). The Memorandum of Association of the
B Corporation provided that Board could not dispose of the land
transferred to the Corporation by the Government other than to the
. State or Central Government or their Departments or Undertakings
without prior written approval of the Government. A Code of Conduct
for Ministers was brought into force which provided that a Minister
shall refrain from buying from, or selling to, the Government any
C immovable property except where such property is compulsorily
acquired by the Government in the usual course and refrain from
starting, or joining, any business. After transfer of Government
Industrial Units to the Corporation, some of the units started incurring
losses. Government decided that the Corporation should close down
D the units and explore the possibility of disposing the properties.
Pursuant to advertisement in Newspaper calling for tenders, a firm,
of which accused-I the Chief Minister of the State and A-2 were the
partners, offered for the tender. The bid of the firm of the accused I •
and 2 was the highest though much lower than the guideline value. It
E was marginally higher than the value fixed by the Collector and
Commissioner of Land Administration. Since the Corporation had
already decided to sell land of the same unit to another Company at
F
the price lower than as bid by th.e firm of accused, the bid was
considered reasonable and Board recommended for the sale to the firm
of accused to the Government. Government approved the sale.
A complaint was lodged. Charges were framed u/ss. 1208, 169
and 409 IPC and u/ss. 13(1)(c) and (d) and 13(2) of Prevention of
Corruption Act on the ground that the property in question was
deliberately sold for less value with a view to confer pecuniary
G advantage to the firm of A-I and A-2 which resulted in wrongful loss
to the Government and wrongful gain to A-1 and A-2.
Trial Court convicted the accused u/ss. 120-B and 409 IPC and
u/s.13(2) r/w. Section l3(1)(c) and (d) of Prevention of Corruption Act.
H
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