STATE OF KARNATAKA VERSUS T.N. SUDHAKAR REDDY CRIMINAL APPEAL NO(S). 5001 OF 2024:

DATE: 17/02/2025

BENCH: Justice Dipankar Datta and Justice Sandeep Mehta

FACTS:

The present case arises from allegations of corruption against the respondent, a public servant employed by the Karnataka Power Transmission Corporation Limited (KPTCL). The respondent initially joined KPTCL as an Assistant Executive Engineer (Electrical) on August 3, 2007, and was later promoted in 2021 to the position of Deputy General Manager (Vigilance)/Executive Engineer (Electrical) at BESCOM, Bengaluru. During his tenure in various government departments, a source information report was submitted by the Police Inspector of Karnataka Lokayukta, Bangalore, on November 10, 2023, alleging that the respondent had amassed assets worth Rs. 3,81,40,246, which were approximately 90.72% beyond his known sources of income. Based on this report, the Superintendent of Police, Karnataka Lokayukta, issued an order on December 4, 2023, directing the registration of a case against the respondent under Sections 13(1)(b) and 12 read with Section 13(2) of the Prevention of Corruption Act, 1988. Subsequently, an FIR (Crime No. 56 of 2023) was registered at the Karnataka Lokayukta Police Station in Bangalore City on the same day.

Challenging the FIR and the ensuing criminal proceedings, the respondent filed a Criminal Petition (No. 13460 of 2023) before the High Court of Karnataka under Section 482 of the Code of Criminal Procedure (CrPC), seeking to quash the case. The High Court, in its judgment dated March 4, 2024, ruled in favor of the respondent and quashed the FIR along with all consequential criminal proceedings. The State of Karnataka, aggrieved by the High Court's decision, has now approached the Supreme Court by way of a special leave petition, seeking to challenge the order that set aside the corruption charges against the respondent.

ISSUES:

The key legal issues in this case are whether a preliminary inquiry was mandatory before registering an FIR under the Prevention of Corruption Act (PC Act) or if the source information report could serve as a substitute for such an inquiry. Additionally, the case examines the legality of the Superintendent of Police’s order dated November 4, 2023, issued under Section 17 of the PC Act, and whether it is legally sustainable.

JUDGEMENT WITH REASONING:

The Supreme Court ruled that the High Court erred in concluding that the Superintendent of Police's order of December 4, 2023, directly violated Section 17 of the Prevention of Corruption (PC) Act. It clarified that a preliminary inquiry is not mandatory if the source information report is detailed and prima facie discloses a cognizable offense. Section 17 of the PC Act applies to the investigation process, not the registration of an FIR, which follows the CrPC. The Superintendent of Police is competent to direct the registration of an FIR and assign the investigation under the PC Act. Consequently, the Court set aside the Karnataka High Court’s order and restored the FIR in Crime No. 56 of 2003. The appeal was allowed.

The Supreme Court held that a preliminary inquiry is not a mandatory prerequisite for registering an FIR under the Prevention of Corruption (PC) Act. Citing Lalita Kumari and Managipet, the Court reiterated that while such an inquiry may be desirable in some cases, it is not legally required if the source information report sufficiently discloses a cognizable offense. The Court emphasized that the Superintendent of Police (SP) is authorized to issue a composite order under Section 17 of the PC Act, directing both the registration of an FIR and the initiation of an investigation. In this case, the Karnataka Lokayukta Police Inspector's source information report, dated November 10, 2023, contained a detailed financial analysis revealing that the respondent’s assets were 90.72% beyond his known sources of income. Given the report's comprehensive nature, the Court found it to be a sufficient basis for FIR registration without requiring a separate preliminary inquiry.

The Court further rejected the High Court’s interpretation, which had imposed an unnecessary four-step procedure that lacked legal backing and hindered corruption investigations. The High Court’s reliance on Bhajan Lal was found to be misplaced, as the SP had applied his mind before issuing the order. The Supreme Court ruled that the SP’s action was neither mechanical nor arbitrary but based on due diligence and legal reasoning. The Court emphasized that requiring an additional preliminary inquiry in such cases could shield corrupt officials from scrutiny. Consequently, it quashed the High Court’s judgment and restored the FIR in Crime No. 56 of 2003, allowing the investigation to proceed in accordance with the law.

ANALYSIS:

The Supreme Court’s decision underscores the principle that procedural technicalities should not obstruct the investigation of corruption cases, particularly when credible and well-documented allegations exist. By holding that a preliminary inquiry is not a mandatory requirement for FIR registration under the Prevention of Corruption (PC) Act, the Court reaffirmed its stance in Lalita Kumari and Managipet, emphasizing that such inquiries are only necessary when the information received is vague or lacks substance. In this case, the Karnataka Lokayukta Police Inspector’s source information report was found to be detailed and well-reasoned, providing a clear financial analysis of disproportionate assets. The Court clarified that the role of Section 17 of the PC Act is to regulate the investigation process rather than the initial registration of an FIR, which is governed by the Code of Criminal Procedure (CrPC). This interpretation ensures that law enforcement agencies are not unduly restricted in taking timely action against corruption, thereby upholding the legislative intent behind the PC Act.

Furthermore, the Supreme Court’s rejection of the High Court’s four-step procedure highlights its commitment to preventing unnecessary procedural barriers that could be exploited to delay or derail corruption investigations. The Court reasoned that the Superintendent of Police’s order was not arbitrary but a legally valid exercise of discretion based on sufficient material. By distinguishing the present case from Bhajan Lal, the Court clarified that the SP’s decision-making process was not mechanical but involved the application of judicial and administrative mind. This ruling strengthens the legal framework for anti-corruption enforcement by ensuring that technical objections do not shield public officials from accountability. Ultimately, the judgment reinforces the principle that the law must balance procedural safeguards with the need for effective investigation, particularly in cases involving public corruption, where swift action is crucial to maintaining public trust in governance.