Union of India and Others v. Lt. Gen. (RETD.) S.K. Sahni
B.R. GAVAI, J.
1. Criminal Appeal No.2169 of 2014 is filed by Union of India and
others challenging the orders passed by Armed Force s Tribunal,
Chandigarh Regional Bench at Chandimandir (hereinafter referre d to
as the “AFT”) dated 10 th October 2013 in MA No. 1871 of 2012 and
OA No. 262 of 2011 to the effect that it reduces the sentence of three
years rigorous imprisonment and cashiering imposed on the respondent
herein-Lt. Gen. (Retd.) S.K. Sahni to dismissal from the s ervice as
UNION OF INDIA AND OTHERS v. LT. GEN. (RETD.) S.K.
SAHNI
provided in Section 71(e) of the Armed Forces Tribunal Act, 2007
(hereinafter referred to as the “AFT Act”), and 21st March 2014 in MA
Nos. 3201 and 3202 of 2014 in OA No. 262 of 2011, whereby the learned
AFT refused to grant leave to appeal.
2. Transferred Case (Criminal) No. 1 of 2017 is filed by the
petitioner therein (respondent herein), originally before the High Court
of Punjab and Haryana being Criminal Writ Petition No. 1895 of 2013,
challenging the dismissal of MA No. 1871 of 2012 and OA No. 262 of
2011, which was filed challenging the order dated 18 th February 2011,
passed by the General Court Martial (hereinafter ref erred to as the
“GCM”), vide which the respondent herein was held guilty of first, third,
fourth, fifth, seventh and ninth charges and was sentenced as under:
(i) To be cashiered; and
(ii) Rigorous imprisonment for three years subject to confirmation.
3. As such, both, the appeal filed by the Union of India and others,
and the transferred case, filed by the respondent herein have been heard
together. For the sake of convenience, the facts are taken from Criminal
Appeal No. 2169 of 2014.
4. The respondent was commissioned in the Indian Army on 16th
December 1967 and earned promotions and was promoted to the rank
of Lieutenant General in May 2003. The respondent was therea fter
appointed as Director General, Supplies and Transport (hereinafter
referred to as “DGST”) with effect from 1 st February 2005. He was
also awarded the “Ati Vishisht Seva Medal” in January 2005.
5. An anonymous complaint was received in the Directorate of
Supplies and Transport (hereinafter referred to as the “Directorate”) on
4th April 2005. On 8th April 2005, the complaint was forwarded and a
request was made to the respondent to examine the compl aint and
forward his comments on the file on priority for perusal of the Directorate.
It is contended by the respondent that he replied to the same on 12th
September 2005.
6. A Court of Inquiry was ordered against the respondent under
the directions of General Officer Commanding-in-Chi ef, Western
Command (hereinafter referred to as “GOC-in-C”), to investigate into
the following seven allegations:
951
“i. Procurement of Kabuli Chana through contract finalized during
April 05 by Army Purchase Organization;
ii. Tendering and procurement of Barley crushed and Gram
kibbled during financial year 2005-2006 by Army Purchase
Organization;
iii. Testing and sampling of items of ration by CFL Delhi as per
laid down specification arid its subsequent purchase/procurement
from various firms/dealers as per approved sample and ASC
specifications;
iv. Tendering and procurement of 979 Metric Tonnes of Masoor
Whole which was supplied by GRAINFED; -
v. Violation, if any, of the laid down quality norms, ASC
specifications and other desired parameters with rega rd to
moisture content, number counts per 100 gm weight, system of
imposing price reduction of commodities contracted.
vi. Any undue favour granted to any contractor for procurement
of meat by HQ Central Command during financial years 2003-
2004 and 2004-2005
vii. Any irregularity with regard to permitting a civil contractor
to dump excavated soil within the compound of ASC Centre
and College of any undue favour taken from any contractor by
and Army pers at ASC Centre and College.”
7. The Court of Inquiry only recommended for award of recordable
censure against the respondent while recommending disciplinary action
qua other officials under the Army Act, 1950 (hereinafter referred to as
the “Army Act”) and Army Rules, 1954 (hereinafter referred to as the
“Army Rules”). However, as per the direction of Army Comma nder,
the respondent’s name was included in the list for disciplinar y action.
The Court of Inquiry was finalized on 24th June 2006, and thereafter, the
GOC-in-C directed a disciplinary action against the respondent.
8. As contended by the respondent, the GOC-in-C, de spite
recommendation mentioned in the Inquiry Report for an administrative
action, directed disciplinary action while admitting that the re was no
evidence of the acts of financial consideration qua the respondent. The
UNION OF INDIA AND OTHERS v. LT. GEN. (RETD.) S.K.
SAHNI [B.R. GAVAI, J.]
respondent, on attaining the compulsory retirement age of 60 years, retired
on 30th September 2006.
9. The respondent filed a writ petition before the High Court of
Delhi being WP (C) No. 11839/2006 seeking for quashing and setting
aside of the proceedings and recommendations of the Court of Inquiry
in terms of order dated 26 th May 2005 and order dated 18 th July 2006
directing attachment of the respondent. The High Court of Delhi allowed
the said writ petition, vide order dated 11th January 2007, in the following
terms:
“For the reasons afore-recorded, we are of the considered view
that the respondents have not complied with the provisions of
Rule 180 of the Rules, as such, they cannot take any further
proceedings against the respondents on the basis of the C ourt
of Inquiry held in furtherance to the order of the competent
authority dated 26.9.2005. However, the respondents are at
liberty to give notice to the respondent and continue with the
proceedings under Rule 180, and in the alternative, even to take
recourse to the provisions of Rule 22, or exercise any other
power available to them under the Act, insofar as they do not
rely upon the proceedings on the aforesaid Court of Inquiry.”
10. The appellants, instead of invoking Rule 180 of the Army Rules,
wherein opportunity was to be provided to the respondent, resorted to
Rule 22 of the Army Rules and issued a fresh notice and pass ed an
order dated 31st August 2007 and ordered attachment under Section 123
of the Army Act.
11. The respondent challenged the above by filing a writ petition
in the High Court of Delhi being WP(C) No. 6632/2007, which was then
transferred to the learned AFT, Principal Bench at New Delhi. The said
learned AFT, vide its order dated 3 rd September 2009, set aside the
subsequent act of the Army Authorities and held that resorting to Rule
22 of the Army Rules was totally unwarranted and illegal. The appellants
were however directed to resort to Court of Inquiry after giv ing an
opportunity to the respondent and to comply with the requirement under
Rule 180 of the Army Rules.
12. The GOC-in-C, vide its order dated 22 nd September 2009,
directed reconvening/reassembling of the Court of Inquiry on the basis
of the liberty granted by the learned AFT, New Delhi vide its order
953
dated 3rd September 2009. The GOC-in-C vide its order dated 12th April
2010, on the basis of the Court of Inquiry, directed disciplinary action
against the respondent.
13. On 30th July 2010, a convening order, directing assembly of
the GCM under the Army Act, was issued. The GCM consisted of 7
Members, out of which, 6 Members were holding ranks of Major General
which was lower than the respondent’s rank. The Presiding Of ficer,
however, was of the rank of Lieutenant General, but was allegedly junior
to the respondent. Even the Judge-Advocate General (he reinafter
referred to as “JAG”) was allegedly junior to the respondent and was
only holding the rank of Colonel. On the same day, i.e., 30th July 2010, a
charge-sheet comprising of nine charges was served upon the respondent.
14. The GCM, vide order dated 18 th February 2011, found the
respondent not guilty of the charges No. 2, 6 and 8 whereas found the
respondent guilty of charges No. 1, 3, 4, 5, 7 and 9 and was sentenced as
under:
(i) To be cashiered; and
(ii) Rigorous imprisonment for three years subject to confirmation.
The findings and sentence of the GCM were confirmed by the
Chief of Army Staff vide its order dated 13th January 2012.
15. The respondent filed an appeal before the learned AFT against
the order of the GCM dated 18 th February 2011, which was further
confirmed by the order dated 13th January 2012 passed by the Chief of
Army Staff. The learned AFT, vide the impugned order dated 10th
October 2013, partly allowed the petition. The learned AFT he ld that
the findings of the GCM as against the respondent were lia ble to be
affirmed. However, the learned AFT held that the sentence of cashiering
and substantive imprisonment of 3 years’ rigorous imprisonme nt was
harsh and thus, modified the sentence to dismissal from service.
16. The respondent filed a writ petition being Criminal Writ Petition
No. 1895 of 2013 before the High Court of Punjab and Haryana at
Chandigarh, challenging the aforesaid impugned order dated 10th October
2013 passed by the learned AFT. The High Court issued notice vide
order dated 28 th October 2013. In the meanwhile, the appellants also
filed an appeal being Criminal Appeal No.2169 of 2014 before this Court,
challenging the order passed by the learned AFT dated 10 th October
UNION OF INDIA AND OTHERS v. LT. GEN. (RETD.) S.K.
SAHNI [B.R. GAVAI, J.]
2013. Thereafter, the respondent filed an application being CRL.M.P.
No.24464 of 2014 in Criminal Appeal No.2169 of 2014 seeking transfer
of Criminal Writ Petition No. 1895 of 2013, pending before the H igh
Court of Punjab and Haryana at Chandigarh to this Court.
17. This Court, vide its order dated 22nd August 2016, allowed the
said application and directed transfer of the said petition to this Court, to
be listed along with Criminal Appeal No.2169 of 2014.
18. We have heard Shri R. Balasubramanian, learned Sen ior
Counsel appearing on behalf of the Union of India and Shri K.K. Tyagi,
learned counsel appearing on behalf of the respondent.
19. Shri Tyagi, learned counsel appearing on behalf of the
respondent, raised a preliminary point that since the Members o f the
GCM were below the rank of the respondent, the GCM was not properly
constituted, and as such, violative of sub-rule (2) of Rule 40 of the Army
Rules. He relies on the order of this Court in the case of Ex. Lt. Gen.
Avadhesh Prakash v. Union of India and Another 1. He submitted
that from perusal of the said order, it will be clear that about 80 Lieutenant
Generals were available in the Indian Army at the relevant time, and as
such, the Court-Martial which had Members below the rank of Lieutenant
General, could not have tried the respondent. He therefore s ubmitted
that the GCM, which is constituted in contravention of sub-rule (2) of
Rule 40 of the Army Rules, could not have tried the respondent . He
further submitted that on the same ground, in view of Ru le 102 of the
Army Rules, since the JAG, who was of the rank of Colonel, which is
below the rank of Lieutenant General, stood disqualified while acting as
a JAG. He relies on the judgment of this Court in the case of Union of
India and Another v. Charanjit S. Gill and Others 2 in this regard.
20. Shri Balasubramanian, learned Senior Counsel appearing on
behalf of the appellants, on the contrary, submitted that though sub-rule
(2) of Rule 40 of the Army Rules requires that the Members of a Court-
Martial for the trial of an officer shall not be of a rank below than that of
the officer, it also provides that a departure from the said rule is
permissible, when in the opinion of the convening officer, having regard
to the exigencies of the public service, the officers of such rank are not
available. He therefore submits that merely because the GCM consisted
1 Criminal Appeal No. 140 of 2019 dated 24.01.2019
2 (2000) 5 SCC 742
955
of the officers below the rank of Lieutenant General itsel f, would not
ipso facto vitiate the proceedings. He submitted that the only requirement
is that such an opinion is required to be recorded in the convening order.
He submitted that insofar as the order of this Court in the case of Ex.
Lt. Gen. Avadhesh Prakash (supra) is concerned, in the said case, the
order was passed by this Court on the concession that such of ficers
were available. He further submitted that in the said ca se, no such
opinion as required under sub-rule (2) of Rule 40 of the Army Rules was
recorded.
21. For appreciating the rival submissions with regard to the
preliminary objections, it will be relevant to refer to sub-rule (2) of Rule
40 of the Army Rules:
“40. Composition of General Court-martial.-
(1). …..
(2). The members of a court-martial for the trial of an
officer shall be of a rank not lower than that of the
officer unless, in the opinion of the convening officer,
officers of such rank are not (having due regard to the
exigencies of the public service) available. Such
opinion shall be recorded in the convening order.”
22. In view of the specific contention with regard to the violation
of sub-rule (2) of Rule 40 read with Rule 102 of the Army Rules , we
have summoned the original file. On perusal of the original file, we find
that the convening officer has recorded reasons as to why the officers
of the rank of respondent were not available. We find that the reasons
given, for doing the same, would fall within the exigencies of the public
service. The scope of judicial review of such a decision is very limited.
Unless it is found that the decision taken by the authority suffers from
arbitrariness, irrationality or unreasonableness, it would not be permissible
for us to sit in an appeal over the decision of the convening officer. The
limited inquiry that would be permissible is, as to whether the reasons
recorded are having regard to the exigencies of the public s ervice or
not. On perusal of the original file, we find that the rea sons given are
directly concerned with the exigencies of the public service. We therefore
do not find any merit in the said submission.
UNION OF INDIA AND OTHERS v. LT. GEN. (RETD.) S.K.
SAHNI [B.R. GAVAI, J.]
23. Insofar as the order of this Court in the case of Ex. Lt. Gen.
Avadhesh Prakash (supra) is concerned, in the said case, the contention
made on behalf of the petitioner therein was that the respondents therein
could have tried to make Lieutenant General available. In a ny case,
from the said order, it is not clear as to whether the subjective satisfaction
as required under sub-rule (2) of Rule 40 of the Army Rules was, in fact,
recorded or not. Another reason that weighed with thi s Court for
interfering with the order of the learned AFT was that the learned AFT
had recorded that since the appellant therein had already retire d from
the service, there was no illegality in constitution of GCM. This Court
found that such a finding was not permissible on the bare r eading of
Rule 40 of the Army Rules.
24. Insofar as the merits of the present matter are conc erned,
Shri Balasubramanian submits that after the learned AFT had concurred
with the findings of the GCM that the charges against the re spondent
stood proved, there was no occasion for the learned AFT to have interfered
with the penalty imposed on the respondent. Insofar as the appea l of
the appellants herein is concerned, the learned Senior Counsel for the
appellants submitted that since there are concurrent findings of fact with
regard to the charges being proved, no interference would be warranted
in the appeal of the appellants. He therefore submitted that the appeal
of the appellants deserves to be allowed and the Tran sferred Case
(Criminal) No. 1 of 2017 filed by the petitioner (respondent in Criminal
Appeal No. 2169 of 2014) be dismissed.
25. Shri Tyagi, learned counsel appearing for the respondent, on
the contrary, would submit that the findings as recorded by the GCM as
well as the learned AFT are recorded on the basis of c onjectures and
surmises. He submitted that in the GCM, the standard that is required to
be followed is of a criminal trial. It is therefore submitted that unless the
charges against an officer are proved beyond reasonable doubt, he cannot
be held guilty in GCM. It is submitted that like a criminal trial, the benefit
of doubt must go to the officer and not to the prosecution. He, however,
submitted that in the present case, the GCM as well as the learned AFT
have given the benefit of doubt to the prosecution.
26. He submits that as a matter of fact, not a single charge stands
proved beyond reasonable doubt against the respondent. However, the
respondent has been convicted by the GCM without any evidence. He
therefore submitted that the Transferred Case (Criminal) No. 1 of 2017
957
filed by the petitioner (respondent in Criminal Appeal No. 2169 of 2014)
deserves to be allowed and the appeal filed by the appellants be dismissed.
27. With the assistance of the learned counsel for the appellants
and the respondent, we have perused the order passed by the GC M as
well as the learned AFT and the materials placed on record.
28. At the outset, we may state that there are inherent limitations
on the jurisdiction of this Court and it will not be p ermissible to
reappreciate the evidence as recorded by the GCM unless thi s Court
finds that the material factors have been either ignored or the evidence
that has come on record, has been appreciated in a totally er roneous
manner. With these limitations in mind, we will consider the materials
placed on record.
29. Though nine charges have been framed against the respondent,
he has been found guilty insofar as charges No. 1, 3, 4, 5, 7 and 9 a re
concerned. He has been found not guilty insofar as charges N o. 2, 6
and 8 are concerned. The learned AFT has also concurred wi th the
finding of fact holding the respondent guilty of the aforesaid ch arges.
The learned AFT has observed that the evidence led with regard to all
these charges is mostly common and as such, has decided all the said
points together.
30. The learned AFT has come to a finding of fact that though the
contracts were finalized by the Army Purchase Organization (hereinafter
referred to as the “APO”), insofar as the provisioning of dry supplies for
the troops is concerned, it found that both the APO as well as the
Directorate, are concurrently and co-jointly responsible for the monitoring,
examination and the progress of the contracts.
31. The respondent, at the relevant time, was holding the post of
DGST. Though nine charges have been framed against the respondent,
they are inter-connected and are related to three transactions as under:
(i) That the respondent had agreed to the proposal of M/s
Gujarat Co-operative Grain Growers Federation Limited
(hereinafter referred to as “M/s GRAINFED”) for
addition of two more tendering stations at Gadarwara,
District Narsingpur, Madhya Pradesh and Narsingpur
in Madhya Pradesh in addition to 14 tendering stations
UNION OF INDIA AND OTHERS v. LT. GEN. (RETD.) S.K.
SAHNI [B.R. GAVAI, J.]
already mentioned in the contract. The charge was that
this was done with an intent to defraud the State;
(ii) That though the respondent had enquired in the c omplaint
dated 4th April 2005 alleging fake tendering and presence
of Kesari Peas and Akra, which were unfit for human
consumption, he had omitted to ensure investigation of
the alleged presence of Kesari Peas and Akra in Dal
Masur Whole. Therefore, the respondent was
instrumental in feeding the food to the Army Personnel,
which was not as per the standards. As a continuation
of the same transaction, with an intent to defraud, he
had agreed to the proposal of M/s GRAINFED for
upgradation of Dal Masur Whole supplied by the firm
knowing that the said item had been found and declared
unfit for human consumption; and
(iii) That the respondent had approved deviation wit h
relaxation to M/s PUNSUP Limited and M/s MMTC
Limited of permitting 350-400 grains per 100 grams of
Kabli Chana as against 300-350 grains per 100 grams,
and that this was done with an intent to defraud.
32. Insofar as the first charge is concerned, the finding s of the
learned AFT would reveal that the request of M/s GRAINFED for two
additional tendering stations at Gadarwara and Narsingpur was made
on 3rd March 2005 to the Chief Director of Purchase (hereinafter referred
to as the “CDP”), APO. The APO forwarded the said request for
comments/views of the Directorate vide communication dated 9th March
2005. The perusal of the orders of the learned AFT as well as the GCM
would reveal that, after accepting the recommendation of PW-6-Major
General (Retd.) S.C. Mohan, the respondent did not agree to the request
of M/s GRAINFED. However, the proposal was put up before him for
reconsideration pursuant to the note prepared by PW-13-Col. (Ret d.)
N.K. Yadav, Director Provisioning, stating that the entire quantity against
the acceptance of tender has already been tendered at Gadarwara within
the delivery period. The respondent therefore agreed to the request of
M/s GRAINFED for two additional tendering stations and the decision
of the respondent was intimated to the APO.
959
33. With regard to the aforesaid charge, it will also be relevant to
refer to the order passed by the learned AFT, in the case of Brig P.S.
Gill v. Union of India and Others 3. In the said case, the petitioner
therein (Brig. P.S. Gill), at the relevant time, was working as CDP, APO.
The relevant portion of the said findings are as under:
“2. From a bare reading of the aforesaid charges it appears that
the petitioner in the capacity of his being Chief Dire ctor of
Purchase, Army Purchase Organisation, Ministry of Defence
contrary to APO/MOD Consolidated Order No.3 of 1987, with
intent to defraud/improperly approved addition of two more
tendering stations namely Gadarwara and Narsingpur in
Madhya Pradesh. For the purpose of drawing the charges,
reliance appears to have been placed by the respondents on the
exhibits, the details of which may be charted out as under:
Exhibit Page Para
L 239 -
LXIX 294 -
XXVII 193 2
VI 141-143 1 and 2
II 83-85 -
V 139-140 -
LXXV 303-305 -
XXVIII to XXXIII/I 194-204/80 -
From the perusal of the exhibits noted above, there is nothing to
show that the addition of two tendering stations was not within
the powers of the petitioner. Nothing could be pointed out t o
show the relevancy of these documents for making out prima
facie case against the petitioner. Further the statement of the
witness namely, PW1 Brig PPS Bal of CDP Army Purchase
Organisation, AHQ New Delhi was scrutinised. He was
categorical in his statement that he was aware of the Consolidated
Order No.3 of 1987 (Ext.2) permits the inclusion of additional
tendering station. Ext.1 is related to the letter dated 06.10.2008
3 OA No. 147 of 2010 dated 24 th May 2011
UNION OF INDIA AND OTHERS v. LT. GEN. (RETD.) S.K.
SAHNI [B.R. GAVAI, J.]
written to M/s M.P. Trade & Investment Facilitation Corporation
Ltd. for “procurement of 1000 MT Gram Crushed (Kibbled)
against A/T even no. dated 05.12.2007 from M/s. MPTRIFAC-
Addition of Tendering Station-Delhi. This one example was
quoted by the witness. This itself indicates that the addition of
tendering stations is within the discretion of the co mpetent
authority to the effect that “stores can be tendered at Delhi as a
special case in the subject A/T, subject to the condition that any
additional expenditure incurred by the purchaser/savings accruing
to the supplier, on account of this addition of tendering Station,
shall be reimbursed by the Supplier to the Government” which
is also exactly the requirement mandated in defence Consolidated
Order No.3 of 1987. Further with regard to the making of the
additional tendering stations by the accused-petitioner as per
the reply of PW1, the contract was amended as required by
Government of India orders and the amended contract was also
communicated by Exh. VI. There was no objection to such
acceptance of tendering stations from Audit authorities or by
PCDA. Apart from it, witness also makes it clear in his answer
to Question No.4 that the tenderer has option to select stations
where he can tender stores as per the contract. The APO do es
not dictate the tendering stations. However, they must le nd
themselves to ease of inspection and movement of stores to
consignee depots. Lastly this witness also clarified tha t by
making the addition of two tendering stations no monetary
benefits could be acquired by petitioner nor there was any extra
expenditure borne out by the respondents owning to acceptance
of two new stations by the accused-petitioner. Further by adding
these two new stations, no violation of any rule or order was
made by the accused petitioner.”
34. It could thus be seen that the very same AFT has come to a
finding that the CDP, APO was within the powers to include additional
tendering stations. It has further been found that there was no objection
to acceptance of such tendering stations from Audit Authorit ies or by
CDP, APO. It is further to be observed that the learned AFT has clearly
noted that the Consolidated Order No. 3 of 1987 permitted inclusion of
additional tendering station subject to the condition that the additional
expenditure incurred by the purchaser/savings accrued to the supplier,
961
on account of this addition of tendering station, shall be reimbursed by
the Supplier to the Government. There was a specific fi nding that on
account of addition of two tendering stations, neither any monet ary
benefits could be accrued to the petitioner therein (Brig P.S. Gill), nor
there was any extra expenditure borne out by the Army owing to
acceptance of two new stations by the petitioner therein (Brig P.S. Gill).
In any case, it is clear from the said order that the author ity to accept
such additional tendering stations was with the CDP, APO. In view of
this specific finding of the learned AFT recorded in the order dated 24th
May 2011, we find that the finding, to the contrary, recorded by another
Bench of the learned AFT vide the impugned order dated 10th October
2013 in the case of the present respondent, would not be sustainable.
35. In any case, it is not even the case of the appellan ts herein
that any loss was caused to the Army on account of such deci sion or
any additional benefit was accrued to M/s GRAINFED by such deviation.
This is apart from the fact that the Consolidated Order No. 3 of 1987
itself required any additional expenditure incurred by the purc haser/
savings made by the supplier to be reimbursed by the Suppli er to the
Government. As such, the findings of the learned AFT that there was
an intention on the part of the respondent to defraud, in our view, would
not be sustainable.
36. Insofar as the second charge is concerned, it is with regard to
the respondent not taking action on the basis of the anonymous complaint
dated 4th April 2005. The related charge is that though the Dal Mas ur
Whole was found to also contain Kesari Peas and Akra, the respondent
cleared the samples and the supply of said Dal Masu r Whole was
cleared. It is the case of the appellants that on account of this, the Dal
Masur Whole, which was not as per the standards, was fed to the Army
Personnel. It is their further case that the respondent also did not take
immediate steps for preventing the consumption of the same. It is to be
noted that after the receipt of the said anonymous complaint, the samples
were sent for analysis and the presence of traces of Kes ari Peas was
revealed during analysis of samples on 13th May 2005. The respondent
thereafter issued instructions to freeze the stocks. It is further to be
noted that the DGST, vide order dated 12 th April 2005, had directed a
Departmental Court of Inquiry to inquire into whether there were any
irregularities in tendering/inspection procedure of Dal Masur Whole
UNION OF INDIA AND OTHERS v. LT. GEN. (RETD.) S.K.
SAHNI [B.R. GAVAI, J.]
offered by M/s GAINFED. It will be apposite to refer to the said order
dated 12th April 2005:
“1. A departmental Court of Inquiry composed as under will
assemble at the place, date and time to be fixed by the Presiding
Officer to investigate whether there were any irregular ities in
tendering/inspection procedure of Masur Whole offered by M/
S Gujarat Coop Grain Growers’ Federation Ltd. for inspection
by CFL ASC, Delhi against AT No.J-13028/1/4-03/45-RP/2005-
PUR III dated 28 Feb 2005:-
Presiding Officer – Brig V Marwaha
DDST, HQ Delhi Area
Technical Members – Col SC Chakravarty
Dir ST (FI)
2. The court will specifically examine the following issues:-
(a) Whether the complete qty of 979.600 MT was tendered by
15 Mar 2005. If so why was the BIO instructed to inspect
only 440.800 MT.
(b) Was it ascertained by the BIO that the complete qty i.e.
979.600 MT has been tendered and a report made to that
effect.
(c) Why did the BIO not carry out sampling of the consignment,
and why were the samples of bags rejected, not brought for
the perusal of CO/Lab analysis.
(d) The decision of CO, CFL ASC Delhi to repack and retender
the stocks as and when ready when the AT Note is against
Risk Purchase; resulting in automatic extn of DP.
(e) The acceptance of a cert from the contractor that the balance
of the consignment ie, 538.400 MT is packed in the same
quality bags as the 440.800 MT; and thereby ordering its
rebagging.
CONFIDENTIAL
3. The Court will examine all associated issues, and pin point
responsibility for lapses if any.
963
4. The proceedings duly completed will be submitted personally
to ADGST (SM) by 19 Apr 2005.”
37. It could thus be seen that the Court of Inquiry was directed to
examine all associated issues and pin point responsibility for lapses, if
any. It is thus clear that the finding that the respondent had failed to take
cognizance of the complaint and direct an inquiry with that r egard, is
contrary to the material placed on record.
38. It is further to be noted that the GCM has itself, in i ts order
dated 18th February 2011, come to a conclusion that 560.727.380 Metric
Tons of Dal Masur Whole was declared gone bad within warranty period
for which recoveries were made from M/s GRAINFED.
39. That leaves us with the third charge with regard to the relaxation
being granted to M/s PUNSUP Limited and M/s MMTC Limited in
acceptance of tender dated 26 th June 2005, vide which 350-400 grains
per 100 grams of Kabli Chana was permitted on price reduction of 0.5%
instead of 300-350 grains per 100 grams. It is to be noted tha t, leave
apart the respondent or anyone else gaining from the said rela xation,
there is a specific finding that on account of the decision of reducing
0.5% contract amount for such a relaxation, there has been a benefit to
the public exchequer. It will be relevant to refer to t he finding of the
learned AFT in the case of Brig P.S. Gill (supra):
“There is no dispute on the point that DGST was the competent
authority for making relaxation in the specification. There is also
ample evidence that the DGST being competent authori ty
permitted to despatch 400 grains per 100 gms. in the place of
300-350 grains per 100 gms. DGST also appears to have made
reduction of 0.5% from the contract amount, in that the
Government money to the tune of Rs.7,57,480.16 was saved in
the matter of supplier M/s. Punjab State Civil Supp lies
Corporation Ltd pertaining to Charge Nos. 3 and 4. Similarly,
within his powers, he granted relaxation to M/s. MMTC to the
tune of Rs.4,48,050.00.”
40. It could thus be seen that the learned AFT has specifi cally
come to a finding that on account of such decision, public money to
the tune of Rs.7,57,480.16 was saved in the case of supplier
M/s Punjab State Civil Supplies Corporation Ltd. Similarly, an amount
UNION OF INDIA AND OTHERS v. LT. GEN. (RETD.) S.K.
SAHNI [B.R. GAVAI, J.]
of Rs.4,48,050/- was saved in the case of relaxatio n granted to
M/s MMTC Limited.
41. It is not the case of the appellants that the Kabli C hana so
supplied was of inferior quality or not as per the standards. T he only
allegation is that the relaxation which was granted was wit h regard to
number of grains that every 100 grams should contain. On the contrary,
on account of reduction in price, there has been a substantial saving to
the public exchequer, leave aside any pecuniary gain to the supplier. As
a matter of fact, even the GCM in paragraph (26) held that the respondent
was entitled to benefit of doubt with regard to his intent but has found
that the said act was prejudicial to good order and military discipline.
42. In any case, it is to be noted that clause 6 (a)(iv) in the tender
inquiry of the APO, which has been in vogue for decades, permitted the
same to be done. It will be relevant to refer the same, which reads thus:
“6 (a)(iv). When an appeal is preferred by the supplier against
the decision of the inspecting officer the final finding of the
appellate authority viz. QMG’s Branch, ST-7/8 will automatically
supersede the original report of the Inspecting Off icer
irrespective of the fact whether the said inspecting of ficer
recommended the consignment to be accepted subject to quality
allowance price reduction etc. In the event of any supplies being
found not conforming to the prescribed specification but being
considered of acceptable quality the Chief Director of Purchase
may, at his sole discretion, accept the supplies subject to s uch
reduction in price as he considers reasonable, in the light of the
defects found in the supplies or the quality of the suppli es
accepted. In case, the reduction in price is up to 5%, the
consignment will be accepted without any reference to the
contractor for acceptance of the price reduction an d the
contractor will not raise any objection thereto. However, if any
consignment is acceptable on price reduction over 5% the
consent of the contractor will be obtained before acceptance of
supplies.”
43. It could thus be seen that the finding in that regard, i n our
view, is also not sustainable. It will also be apposite to refer to the following
observations of the learned AFT in the impugned order:
965
“38. However, we are of the opinion that though these charges
stand proved which show that he had failed to perform the duties
of the post of which he was assigned the duties and had done
such acts prejudicial to good order and military discipline and he
cannot escape the responsibilities in this regard. It is tru e that
his acts were prejudicial to army discipline and he had committed
such acts with intent to defraud but it cannot be said that he
actually committed fraud or did any such act which resulted in
actual loss or wrongful gain to any person though his acts lead
to an inference that attempts were made to cause a wrongf ul
gain and, therefore, he cannot escape his liabilities.”
44. It could thus clearly be seen that the learned AFT has come to
a conclusion that it cannot be said that the respondent ha s actually
committed fraud or did any such act, which resulted in actual loss or
wrongful gain to any person. However, in the same breath, the learned
AFT observes that the acts lead to an inference that a ttempts were
made to cause a wrongful gain, and therefore, the respondent cannot
escape his liabilities. Observing this, the learned AFT comes to a finding
that the offence under Section 52(f) of the Army Act, 1950, which reads
thus, was made out against the respondent:
“52. Offences in respect of property.-
…..
(f). does any other thing with intent to defraud, or to cau se
wrongful gain to one person or wrongful loss to another person.”
45. We are afraid as to whether such a finding would be sustainable
in law. The learned AFT has specifically come to a finding that the
respondent has not committed any fraud or did not commit any act which
resulted in actual loss or wrongful gain to any person. We are unable to
appreciate as to on what basis the learned AFT comes to a c onclusion
that the acts lead to an inference that the attempts were m ade to cause
a wrongful gain. The finding as recorded by the learned AFT is totally
contrary to the material placed on record.
46. We, therefore, find that the orders passed by the learned AFT
as well as the GCM are not sustainable in law. The ap peal of the
appellants deserves to be dismissed and the Transferred Case (Criminal)
UNION OF INDIA AND OTHERS v. LT. GEN. (RETD.) S.K.
SAHNI [B.R. GAVAI, J.]
No. 1 of 2017 filed by the petitioner (respondent in Criminal Appeal No.
2169 of 2014) be allowed.
47. In the result, we pass the following order:
A. Criminal Appeal No. 2169 of 2014:
(i) Criminal Appeal No. 2169 of 2014 filed by the appellants is
dismissed.
B. Transferred Case (Criminal) No. 1 of 2017:
(i) Transferred Case (Criminal) No. 1 of 2017 filed by th e
petitioner (respondent in Criminal Appeal No. 2169 of 2014)
is allowed;
(ii) The order dated 18 th February 2011 passed by the GCM
holding the petitioner guilty and imposing penalty on him
and the impugned order dated 10th October 2013, passed by
the learned AFT are quashed and set aside;
(iii) The petitioner is acquitted of all the charges levelled
against him; and
(iv) The petitioner would be entitled to all pensionar y and
consequential benefits in accordance with law. The arrears
of such benefits shall be computed and paid to the petitioner
within a period of three months from the date of this judgment.
Devika Gujral and Amarendra Kumar Appeal dismissed a nd
(Assisted by : Rituja Chouksey, LCRA) Transferred Ca se allowed.