2025 (7) TMI 1626 - HC - Indian Laws

Seeking quashing of summoning order - Proceeding in respect of acts allegedly committed during his tenure as Deputy Director (Investigation Income Tax Gurugram)- violation of the mandatory preconditions contemplated under Section 19 of the PC Act and Section 197 of the Cr.P.C. despite denial of sanction by the competent authority - scope of protective umbrella of Section 197 of the Cr.P.C. - refusal of sanction under Section 19 of the PC Act bars prosecution under the IPC - IPC offences are inextricably linked to allegations under the PC Act. Whether the refusal of sanction under Section 19 of the PC Act bars prosecution under the IPC? - HELD THAT - The refusal was limited to prosecution under the PC Act. The proposal considered was one seeking sanction under Section 19 of the PC Act and the decision was rendered accordingly. No decision was taken on nor was any sought under Section 197 of the Cr.P.C. in relation to offences under IPC. The Hon ble Supreme Court in A. Sreenivasa Reddy s case 2023 (8) TMI 650 - SUPREME COURT has authoritatively clarified that sanction under Section 19 of the PC Act and under Section 197 of the Cr.P.C. operate in distinct spheres. A refusal of sanction under the PC Act does not operate as a blanket bar on prosecution under provisions of the IPC provided the ingredients of those offences are independently satisfied - the issue is answered in the negative. Whether the offences under IPC are inextricably linked to allegations under the PC Act and cannot stand alone? - HELD THAT - In Sachin Ahlawat s 2025 (4) TMI 1526 - PUNJAB AND HARYANA HIGH COURT the only offence under IPC alleged was conspiracy under Section 120-B and the prosecution was inseparable from the charge under the PC Act. In the present case however the petitioner is charged with substantive offences under Sections 409 420 468 471 and 201 IPC each of which is independently defined and supported by prima facie evidence including the report of CFSL noting deletion of data and alteration of the contents of the hard disk as well as recovery of official documents from the personal device of the petitioner - In A. Sreenivasa Reddy s case the Supreme Court held that even if the public servant is discharged of offences under the PC Act prosecution under IPC may continue if the allegations constitute distinct offences. The offences under IPC in the instant case involve distinct ingredients breach of trust forgery falsification of digital records and destruction of evidence which are legally severable from the misconduct alleged under the PC Act - the issue is answered in the negative. Whether sanction under Section 197 of the Cr.P.C. was required in the facts of the present case? - HELD THAT - The acts alleged tampering with digital evidence deletion of official records and resealing a forensic device with altered content are not acts that can be said to have been committed in the discharge of official duty but rather in derogation of it - Similarly in Suneeti Toteja s case 2025 (2) TMI 1218 - SUPREME COURT the Supreme Court reaffirmed that the requirement of sanction under Section 197 of the Cr.P.C. is attracted only where the act is directly and reasonably connected with official duty which in turn would depend on the facts and circumstances of the case. The Hon ble Supreme Court in G.C. Manjunath s case 2025 (4) TMI 1670 - SUPREME COURT itself reiterated the principle laid down in D. Devaraja Vs. Owais Sabeer Hussain 2020 (6) TMI 802 - SUPREME COURT that an offence committed entirely outside the scope of the duty of the public servant would certainly not require sanction and that if the act is connected to the discharge of official duty sanction is necessary; but if it is a cloak to justify independent criminal acts it is not. Applying this test the present acts cannot be said to have a reasonable nexus to the discharge of official duties under the Income Tax Act. No public servant is empowered by his official function to erase or falsify forensic material or to suppress evidence for the benefit of a private assessee. This Court finds no legal infirmity in the impugned orders. The summoning order dated 29.03.2025 (Annexure P-6) discloses due application of mind. The learned Revisional Court has rightly upheld that the prosecution under the provisions of IPC is not barred by the refusal of sanction under Section 19 of the PC Act or the embargo under Section 197 of the Cr.P.C. The prosecution is supported by prima facie material including reports of Forensic Science Laboratory and cannot be interdicted on technical grounds. Petition dismissed.

Summary

ISSUES:

Whether the refusal of sanction under Section 19 of the Prevention of Corruption Act (PC Act) bars prosecution under the Indian Penal Code (IPC)?Whether the offences under the IPC are inextricably linked to allegations under the PC Act and cannot stand alone'Whether sanction under Section 197 of the Criminal Procedure Code (Cr.P.C.) was required in the facts of the present case?

RULINGS / HOLDINGS:

Refusal of sanction under Section 19 of the PC Act does not operate as a blanket bar on prosecution under provisions of the IPC, provided the ingredients of those offences are independently satisfied. The refusal was limited to prosecution under the PC Act only.The offences under the IPC, including breach of trust, forgery, falsification of digital records, and destruction of evidence, involve distinct ingredients legally severable from the misconduct alleged under the PC Act and are supported by prima facie evidence; therefore, they can stand alone.Sanction under Section 197 of the Cr.P.C. is not required where the alleged acts are not committed in the discharge of official duty but are contrary to it. The acts of tampering with digital evidence, deletion of records, and concealment of documents were held to be in derogation of official duty and thus outside the protection of Section 197.

RATIONALE:

The Court applied the legal framework distinguishing the scope of Section 19 of the PC Act and Section 197 of the Cr.P.C., relying on authoritative Supreme Court precedents including A. Sreenivasa Reddy Vs. Rakesh Sharma, which clarify that refusal of sanction under the PC Act does not bar independent prosecution under the IPC.The Court distinguished the present case from precedents where IPC offences were limited to conspiracy linked to PC Act allegations, emphasizing that substantive IPC offences supported by forensic evidence constitute separate offences.The Court relied on the principle that Section 197 protection applies only where acts are "directly and reasonably connected with official duty," citing judgments such as G.C. Manjunath & Others Vs. Seetaram and D. Devaraja Vs. Owais Sabeer Hussain, to hold that acts constituting deliberate tampering and deletion of evidence fall outside official duty and thus do not attract the sanction requirement.The Court rejected the petitioner's reliance on Section 197 protection, holding that the acts alleged were a "cloak to justify independent criminal acts," and thus sanction was not a jurisdictional prerequisite.