STATE REPRESENTED BY INSPECTOR OF POLICE, CBI, ACB, VISAKHAPATNAM versus ELURI SRINIVASA CHAKRAVARTHI AND OTHERS

Citation: [2025] 5 S.C.R. 988 · Decided: 22-05-2025 · Supreme Court of India · Bench: PANKAJ MITHAL · Disposal: Appeal(s) allowed

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Judgment (excerpt)

[2025] 5 S.C.R. 988 : 2025 INSC 758
State Represented By Inspector of Police, CBI,  
ACB, Visakhapatnam 
v. 
Eluri Srinivasa Chakravarthi and Others
(Criminal Appeal No(s). 2784-2794 of 2025)
22 May 2025
[Pankaj Mithal and S.V.N. Bhatti,* JJ.]
Issue for Consideration
Whether the two letters could have been looked at or relied upon 
by the Special Court for exercising its jurisdiction u/s.239, Code 
of Criminal Procedure, 1973.
Headnotes†
Code of Criminal Procedure, 1973 – s.239 – Discharge – 
Material to be relied upon – FIR registered by CBI, charges filed  
u/ss.120B r/w. 420, 468, 471, IPC and s.13(2) r/w 13(1)(d), PC 
Act alleging that the accused conspired to purchase cotton 
at lower prices, hoarded these cotton stocks and resold it to 
Cotton Corporation of India (CCI) at higher MSP rates through 
benami farmers, causing wrongful loss to CCI and wrongful 
gain to the accused persons – Accused persons filed petition 
u/s.239 and inter alia relied on letters dtd. 08.01.2007 addressed 
by the CBI to the CCI and the reply of CCI dated 31.01.2007 
stating that there was no loss caused to CCI – Accused were 
discharged relying on the letter dtd. 31.01.2007 – Interference 
with: 
Held: The discharge was ordered not by referring to any of the 
situations referred in s.239, but by relying on the documents made 
available by the accused – The procedure followed by the special 
court and confirmed by the High Court is illegal and contrary to the 
binding precedent – The passing remark by the High Court that 
there is no material for cheating and forgery belies the existence 
of allegations and documents – For discharge, the special court 
and the High Court ought to have considered the chargesheet and 
list of documents, in the background of allegations made against 
* Author
[2025] 5 S.C.R. 
989
State Represented By Inspector of Police, CBI, ACB,  
Visakhapatnam v. Eluri Srinivasa Chakravarthi and Others
the accused – However, they considered the material invited at 
the instance of the defence for ordering discharge – Discretionary 
limit as set out u/s.239 not complied with – Impugned orders set 
aside, discharge petitions filed by the accused dismissed – Special 
court to exercise its jurisdiction in terms of s.239 uninfluenced by 
any of the observations made herein. [Paras 27, 28]
Code of Criminal Procedure, 1973 – s.239 – Jurisdiction 
under  – Exercise of discretion – Duty of Magistrate – 
Discussed. [Paras 25.1-25.3, 26-26.3]
Case Law Cited
Satish Mehra v. Delhi Administration and Another [1996] Supp. 
4 SCR 197 : (1996) 9 SCC 766; State of Bihar v. Ramesh Singh 
[1978] 1 SCR 257 : (1977) 4 SCC 39; Supdt. and Remembrancer of 
Legal Affairs, West Bengal v. Anil Kumar Bhunja and Others [1980] 
1 SCR 323 : (1979) 4 SCC 274; State of Orissa v. Debendranath 
Padhi [2004] Supp. 6 SCR 460 : (2005) 1 SCC 568; State of 
Rajasthan v. Swarn Singh @ Baba, Criminal Appeal No. 856 
of 2024; Sheoraj Singh Ahlawat v. State of U.P. [2012] 10 SCR 
1034 : (2013) 11 SCC 476; State of Madhya Pradesh v. Rakesh 
Mishra [2015] 3 SCR 765 : (2015) 13 SCC 8; State of Rajasthan v. 
Ashok Kumar Kashyap [2021] 4 SCR 158 : (2021) 11 SCC 191; 
Union of India v. Prafulla Kumar Samal and Another [1979] 2 SCR 
229 : (1979) 3 SCC 4 – referred to.
List of Acts
Code of Criminal Procedure, 1973; Prevention of Corruption Act, 
1988; Penal Code, 1860.
List of Keywords
Section 239 of Code of Criminal Procedure, 1973; Discharge; 
Cotton stocks; Cotton stocks hoarded; Hoarded cotton stocks 
resold; Benami farmers; Minimum Support Price (MSP); Higher MSP 
rates; Cotton Corporation of India (CCI); Wrongful loss; Wrongful 
gain; Conspiracy; Modus operandi; Forgery; Fabrication, Forged 
documents; Abused official position; Agricultural Market Committee 
(AMC); Cotton Purchase Officer (CPO); Suo motu FIR; Reliance 
on material invited at the instance of the defence; Reliance on the 
documents made available by the accused.
990
[2025] 5 S.C.R.
Supreme Court Reports
Case Arising From
CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No(s). 
2784-2794 of 2025
From the Judgment and Order dated 27.12.2021 of the High Court 
of Andhra Pradesh at Amravati in CRLRC Nos.3388 and 3393 of 
2017, CRLRC Nos. 6, 9, 12, 15, 29, 424, 512, 513 and 861 of 2018
Appearances for Parties
Advs. for the Appellant:
K M Nataraj, A.S.G., Ms. Rukhmini Bobde, Mukesh Kumar Maroria, 
Anuj Srinivas Udupa, Ms. Vanshaja Shukla, Ashok Panigrahi,  
Ms. Seema Patnaha.
Advs. for the Respondents:

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