STATE OF BIHAR ETC. ETC. versus P.P. SHARMA, IAS AND ANR.

Citation: [1991] 2 S.C.R. 1 · Decided: 02-04-1991 · Supreme Court of India · Bench: KULDIP SINGH · Disposal: Appeal(s) allowed

Cited by 12 judgment(s) · cites 6 · see the full citation network in Lexace

Judgment (excerpt)

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STATE OF BIHAR ETC. ETC. 
v. 
P.P. SHARMA, IAS AND ANR. 
APRIL 2, 1991 
[KULDIP SINGH AND K. RAMASWAMY, JJ.] 
Constitution of India, 1950: Article 226-High Court-When and 
under what circumstances would be justified to quash charge sheet 
before cognizance of offence taken by criminal court. 
Code of Criminal Procedure: Sections 173, 194, 197-Investi-
gation-Powers ofpolice-lntereference by Court when arises. 
The Bihar State Co-operative Marketing Union (BISCOMAUN) is 
the sole purchaser and distributor of fertilizers in the State. When the 
BI SCOMA UN was at the brink of liquidation due to mismanagement, 
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B 
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the State Government superseded its Board of Directors and appointed 
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R.K. Singh, I.A.S., as its Administrator and Managing Director on 
July 30, 1988. 
In the course of the discharge of his duties, R.K. Singh noted that 
financial irregularities had been committed by P.P. Sharma, the first 
respondent, Genesh Dutt Misra, the second respondent, and Tapesh-
E 
war Singh, in the purchase of fertilizers for distribution in the State. At 
the relevant time, P.P. Sharma was the managing Director of BISCO-
MAUN, Genesh Dutt Misra its advisor, and Tapeshwar Singh its 
Chairman. 
R.K. Singh laid the information regarding the financial irregu-
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larities before the Station House officer, Gandhi Maidan Police Station, 
Patna on September 1, 1988. The substratum of the accusations made 
against them was that they had conspired with the R&jasthan Multi 
Fertilizers Private Limited, through its partners, to cause wrongful 
gains to the company and wrongful loss to the BISCOMAUN in the 
matter of purchase of sub-standard fertilizers from the Company. 
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On the basis of the report, a case under sections 409, 420, 468, 
469, 471, 120B, I.P.C., and section 7 of the Essential Commodities Act, 
was registered against eight persons including Tapeshwar Singh, P.P. 
Sharma, and Ganesh Dutt Misra. Four other accused persons were the 
partners of the Company, and the fifth one was an Assistant in the 
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SUPREME COURT REPORTS 
[1991] 2 S.C.R. 
A department who was alleged to have forged the test reports. 
The investigation in the case was completed by police and two 
police reports, one under section 7 of the Essential Commodities Act 
and the other under various sections of the J.P.C., were submitted 
before the Competent Court in October 1988. The Special Judge Patna 
B heard the arguments of the parties on various dates between January 9, 
1989 and January 31, 1989 on the question as to whether there was 
sufficient material in the police reports to take cognizance of various 
offences projected therein. On January 31, 1989 the learned Special 
Judge concluded the arguments and reserved the orders. 
Tapeshwar Singh and P.P. Sharma filed writ petitions before the 
C Patna High Court praying for quashing of the First Information Report 
and the police reports. The High Court allowed the writ petitions and 
quashed the FIR and the criminal proceedings against the accused-
petitioners. 
[) 
The High Court, on appreciation of the documents which were 
produced before it, as annexu_res to the writ petitions, came to the 
conclusions that no prima facie offence was made out against the 
respondents; that though the annexures, being part of BISCO-records, 
were to the knowledge of R.K. Singh, he closed his eyes to the facts 
contained in these documents and acted in a ma/a-fide manner in lodg-
E 
ing the FIR against the respondents on false facts; that the prosecution 
was vitiated because G.N. Sharma, the Investigating officer, acted with 
malice in refusing to take the annexures into consideration; and that no 
case under Essential Commidities Act was made out from the police 
reports and other documents on record. The High Court further held 
that the composite order granting sanction under section 197 Cr.P.C. 
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and section 15-A of the Essential Commodities Act was vitiated because 
of non application of mind on the part of the competent authority; and 
that the F.I.R. and the Charge Sheets violated the constitutional 
mandate under Article 21 of the Constitution. 
The instant appeals are against the judgment of the High Court, 
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and the appellants are Girija Nandan Sharma, S.P. CID, Patna, the 
investigator, and R.K. Singh, the informant, along with the State of 
Bihar. 
Before this Court it was contended on behalf of the appellants that 
the High Court in the exercise of its extraordinary jurisdiction commit

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