[DK Shivakumar Disproportionate Assets Case] State's Consent For CBI Probe Merely Executive Order, Not Sanction For Prosecution: Karnataka High Court

The Karnataka High Court last month dismissed a petition filed by Congress leader D K Shivakumar seeking to quash the sanction for prosecution granted by State to the CBI, to investigate the offences alleged against him under the provision of Prevention of Corruption Act.

A single judge bench of Justice K Natarajan said the impugned order was merely a consent given by the State under Section 6 of the DSPE Act, "it is not a sanction as required under either Sections 19 or 17 of the Prevention of Corruption Act.”

The Income Tax department had carried out a raid in August 2017 at various premises of Shivakumar in New Delhi and other places and they collected Rs.8,59,69,100. It is alleged that Rs.41.00 lakhs was recovered from his premises.

Subsequently, a case was registered against Shivakumar before the Special Court for Economic Offences under the provisions of the Income Tax Act, 1961. Based upon registering the income tax case, the Directorate of Enforcement also registered a case and subsequently, Shivakumar was arrested on September 3, 2019.

Thereafter, the office of the Special Director of ED issued a letter dated 09.09.2019 to the State Government by acting under Section 66(2) of Prevention of Money Laundering Act, 2002. Following which the Government of Karnataka accorded sanction against Shivakumar, referring the matter to the CBI for investigating the case.

Shivakumar primarily contended that the State Government while passing the impugned order, referring investigation to CBI, has not applied its mind. While passing the said order, the State Government has simply narrated the contents of the letter issued by the ED and referred the case to the CBI and in turn, the CBI registered an FIR against the petitioner, which is not sustainable under law, it was argued.

Further, the dismissal of the petition filed by one Shashi Kumar Shivanna challenging the same order will not act as res-judicata and Shivakumar being an accused has the Right to challenge the government order, it was contended.

The state government opposed the plea contending that the order passed by the State Government under Section 6 of the Delhi Special Police Establishment Act, does not require an order of sanction and it is only a consent given to the CBI to investigate into the matter. Therefore, the order is a simple executive order and it does not require a detailed reason for according consent.

Further, the Co-ordinate Bench of the High Court has already considered the reference order dated 25.09.2019 which was challenged by one Shashi Kumar Shivanna. The judgment passed by the Co-ordinate Bench has upheld the order passed by the State Government and not against any person. Therefore, the judgment of the Co-ordinate Bench is 'Judgment In Rem' and it is binding on all the persons. Therefore, it cannot be questioned since the principles of res judicata applies, State submitted.

Findings:

The bench cited various precedents to conclude that though in the impugned order it was mentioned as sanction was accorded but literally it is only a consent and it is not a sanction and it is only a simple executive order by giving consent to the CBI for investigating the matter as against Shivakumar.

Noting that the Under Secretary has considered the letter sent by the ED and passed the order, it held “Even Section 6 of the DSPE Act says that it is only a consent of the State Government for investigation by the Central Police. Such being the case, the contention of the learned counsel for the petitioner cannot be acceptable that there is no application of mind while passing the impugned order. Therefore, on that ground, the impugned order cannot be quashed.”

Referring to the order passed by the Coordinate bench while dismissing the petition filed by Shashikumar Shivanna the bench said “The Co-ordinate Bench while dealing with the matter has categorically held and given finding on the reference to the CBI in the impugned order. Therefore, it cannot be said that the finding of the Coordinate Bench is only on the petition filed by the Shashi Kumar Shivanna, but it was on the issue of reference of the case to the CBI for investigation against this petitioner for the provisions of P.C. Act.”

Thus it held the judgment of the Co-ordinate Bench was 'Judgment In Rem', it was binding on Shivakumar also.

It added “Therefore, the contention of the petitioner counsel cannot be acceptable that the judgment should be between the same parties, but it was an identical dispute on the same subject matter which was dealt with by the Co-ordinate Bench. Therefore, the doctrine of the res judicata applies to this case and also the order of the Co-ordinate Bench is binding on this petitioner.”

Accordingly it dismissed the petition. 

Case Title: D K Shivakumar And State of Karnataka

Case No: WRIT PETITION NO.10479 OF 2020

Citation: 2023 LiveLaw (Kar) 166

Date of Order: 20-04-2023

Appearance: Senior Advocate Udaya Holla for Advocate Rajendra M S, for petitioner.

SPP-II Hedge a/w HCGP Mahesh Shetty for R1.

Special Counsel P. Prasanna Kumar, for R3.

Click Here To Read/Download Order