Tuesday, January 24, 2017

Coal Block Allocation Cases and the Exclusion of Jurisdiction

The Supreme Court did three important things in Order dated 25.07.2014 in Manohar Lal Sharma v. Principal Secretary & Ors. [W.P. (Crl.) 120/2012]:
  • Directing the competent authorities to issue requisite notifications to appoint Mr. Bharat Parashar as a Special Judge to exclusively deal with “offences pertaining to coal block allocation matters”;
  • Transferred all cases pending before courts “pertaining to coal block allocation matters” to the Court of this Special Judge;
  • Clarified that “any prayer for stay or impeding the progress in the investigation/trial can be made only before this Court and no other Court shall entertain the same.”
The Delhi High Court in Girish Kumar Suneja v. CBI [Crl. M.C. No. 3847/2016, decided on 27.10.2016] dismissed a petition under Section 482 Cr.P.C. as being non-maintainable, being of the view that the Order dated 25.07.2014 passed in W.P. (Crl.) 120/2012 by the Supreme Court completely excluded the jurisdiction of the High Court (excluding appeals against judgments). 

Today, the Coal Bench of the Supreme Court posted a batch of eight connected matters for hearing on the 6th of February (including the challenge against the Delhi High Court order in Suneja). These cases, both directly and indirectly, challenge an important issue of law: the exclusion of the High Court in either appeals, revisions, or writ jurisdiction in the coal block allocation cases. This has been discussed earlier on this blog, and I develop those thoughts in this post in support of the position that such an exclusion is unconstitutional. 

Testing Article 14
In State of West Bengal v. Anwar Ali Sarkar [AIR 1952 SC 75], the West Bengal Special Courts Act 1950 was struck down as there was no guidance offered by Section 5 of that Act in prescribing which category of cases merited the special procedure, which greatly differed from the ordinary procedure prescribed in the Cr.P.C. 

The Supreme Court thus upheld, in principle, creation of a specialised procedure through statute to address a particular category of offences. In Kedar Nath Bajoria v. State of West Bengal [AIR 1953 AIR 404], the majority concluded that the West Bengal Criminal Law Amendment (Special Courts) Act, 1949 suffered from no infirmities when it allowed the executive to selectively send certain cases to Special Courts, as long as they were from a selection of economic offences provided for in the Schedule. Similarly, in Asgarali Nazarali Singaporewalla v. State of Bombay [AIR 1957 SC 503], the Supreme Court upheld the validity of the Criminal Law Amendment Act, 1952, which created a special procedure for the trial of offences under Sections 161, 165, 165A IPC and Sections 5(2) of the Prevention of Corruption Act, 1947 (all provisions now repealed). 

In Re Special Courts Bill [AIR 1979 SC 478], the Supreme Court answered a reference under Article 143(1) of the Constitution of India, when the President sought consideration on whether the Special Courts Bill, 1978, was constitutional. On the issue of Article 13, the Justice Chandrachud (as he then was) provided a thirteen-limb test to judge the Bill, and found that it passed muster. 

Adopting the tests laid down by the Supreme Court, it is apparent that the Order dated 25.07.2014 is bad in law. It creates a distinct category of cases “pertaining to coal block allocation matters” without specifying the scope and extent of this classification. Nothing is provided to show how the present classification carries any objective, and how it is connected to such an objective in the first place. 

Just, Fair, and Reasonable?
The particular classification enforced by the Order dated 25.07.2014 creates a procedure that violates Article 21 of the Constitution, for it is not just fair and reasonable following the test of Maneka Gandhi v. Union of India [AIR 1978 SC 597]. The Supreme Court has, since Vineet Narain [(1996) 2 SCC 199; (1998) 1 SCC 226], reluctantly agreed to monitor investigations in certain sensitive cases. These ‘Court-Monitored Investigations’, have the agency report directly to the Supreme Court during investigation to the complete exclusion of other forums. However, as clearly held in Vineet Narain, the exclusivity came to an end with the completion of an investigation, and regular criminal procedure resumed.

In the present case, the exclusivity continues for the entire duration of the trial, and thus offends Article 21 of the Constitution. The concept of a fair trial is embedded within the notion of Article 21, and the idea of a fair trial encapsulates within it the concept of effective forums of Appeal. The adjudication in appeal or extraordinary situations by a constitutional court, i.e. the High Court, is certainly part of the fair trial guarantee under Article 21. The decision by a Division Bench of the Supreme Court in Shahid Balwa v. Union of India [(2014) 2 SCC 687] where such an exclusion was upheld must be reconsidered. The nebulous concept of ‘large public interest’ cannot override the concrete constitutional guarantees made to every person under the Constitution of India.

As the denial of adjudication by the High Court for only a vague category of persons is clearly contrary to Article 21, it must then be determined whether there is any law to save such discrimination. The order dated 25.07.2014, would not be law for the purposes of Article 21, and therefore nothing saves the violation of Article 21 in the present case. 

Violating the Basic Structure?
The very exercise of the judiciary creating a special procedure for the trial of certain offences is contrary to the Basic Structure. The creation of offences, and the creation of their procedure, is a function well-vested with the Legislature in the separation of powers fundamental to the Constitution’s basic structure. Such usurpation of power offends the system of checks and balances that is inherent in the Constitution. It is akin to the process of re-promulgating ordinances, which a Seven-Judge Bench of Supreme Court recently held to be a fraud on the Constitution [Krishna Kumar Singh & Anr. v. State of Bihar & Ors, Civil Appeal No. 5875/1994, decided on 02.01.2017].

Furthermore, the Supreme Court in L. Chandra Kumar v. Union of India & Ors. [(1997) 3 SCC 261] found the complete exclusion of judicial review by the Administrative Tribunals Act, 1985 to be contrary to the basic structure of the Constitution. The power of the High Courts under Article 226/227 was specifically found to be part of the Basic Structure by the Constitution Bench in L. Chandra Kumar. Therefore, the exclusion of jurisdiction perpetrated by the Order dated 25.07.2014 is illegal, and accordingly cannot be given effect to.

Although it is settled that judicial orders are outside the purview of Part III of the Constitution [Naresh Sridhar Mirajkar, AIR 1967 SC 1], this cannot be utilised to do indirectly what is impermissible directly. A Seven-Judge Bench of the Supreme Court in A.R. Antulay v. R.S. Nayak & Ors. [(1988) 2 SCC 602] reviewed and set aside orders passed by another bench of the Court in proceedings whereby a special, but illegal, procedure was created to address the trial of certain offences against the erstwhile Chief Minister of Maharashtra. While doing so, it was observed that “the power to create or enlarge jurisdiction is legislative in character, so also the power to confer a right of appeal or to take away a right of appeal. Parliament alone can do it by law. No Court, whether superior or inferior or both combined can enlarge the jurisdiction of the Court or divest the person of his rights of revision and appeal."

Sunday, January 15, 2017

The Sahara-Birla Diaries Controversy

The Supreme Court of India recently dismissed a plea demanding a 'court-monitored investigation' into the allegations of corruption arising out of papers seized from prominent Indian business houses, given the tabloid-friendly 'Sahara-Birla Diaries' moniker. Naturally, news reports that the Petitioners treat this as a setback, stating that the Court "abdicated its constitutional responsibility" in dismissing the claims. The Wire carried an interesting piece, arguing the dismissal ignored binding precedent in Lalita Kumari [(2014) 2 SCC 1], which was decided by five judges. This is my take on the affair, as it has unfolded so far.

The Ordinary way to Begin Criminal Investigations
The Criminal Procedure Code 1973 provides a clear process for bringing information of an offence to the notice of police [Section 154(1)]. The Constitution Bench in Lalita Kumari held that the police must register an FIR on this information, if it discloses a cognizable offence. What if the police fails to do this? The Supreme Court has repeatedly stressed how the ordinary procedure itself provides sufficient remedies as well, which is what aggrieved persons must trigger before running to the High Court or Supreme Court [See here, for a recent example]. If the police do not register an FIR, the law asks the complainant to move a superior officer [Section 154(3)], and eventually petition the jurisdictionally-proper Magistrate to look into the matter [Section 156(3)].

Did the Sahara-Birla Dismissal Ignore Precedent?
Lalita Kumari is a curious case which I hope to discuss properly soon. For now, it is enough to note that besides stating that registering the FIR is mandatory, the Supreme Court also legitimised a 'Preliminary Enquiry'. According to Paragraph 120 [SCC Version] of the decision, the Enquiry is a measure to prevent the immediate dismissal of complaints. The police were tasked with double-checking whether a complaint did not disclose cognizable offences before discarding it. In all of this, the Court insisted that the quality of information cannot be judged at this stage. 

The Wire piece uses this conclusion in Lalita Kumari to argue that the Supreme Court ought to have decided differently, rather than dismissing the information as lacking any cogent material to support them. Attractive as it may seem, the argument is devoid of substance. First, the Wire piece does not engage with why the ordinary procedure was ignored to begin with. If we are talking about Lalita Kumari, where do the Petitioners show that the FIR was not registered on a complaint they filed? The second and third problems are linked, and these concern the failure to appreciate subtle differences between the Enquiry as spoken of in Lalita Kumari with a Preliminary Enquiry done by the CBI. The Wire piece does not note how Lalita Kumari expressly does not deal with a CBI investigation or Court-Monitored Investigation, which is what this case was all about. Since Lalita Kumari never came into the picture, there is no question of the Bench ignoring it here. 

The Court Monitored Investigation as a process started with another set of diaries, the 'Jain Hawala Diaries'. Then, as now, papers were found linking payments to politicians and a Writ Petition was filed in 1993 alleging inaction by the CBI [the political nature of which was noted recently on the Blog]. Only after carefully considering the matter and the allegations did the Supreme Court decide to 'monitor' the investigations. This meant the case was regularly listed, with investigating agencies providing regular updates while insulating the matter from the executive. So, one could in fact argue that the Supreme Court has upheld precedent in the 'Sahara-Birla Diaries' case by not immediately moving to a court-monitored probe. 

Conclusions - Another Arrow for Independent Investigations
There is nothing, anywhere in the law, about why some sensational claims should deviate from the ordinary procedure. Yet living in the times of the 2-G, Coal, and Black Money Scandals, many think it only natural that the non-partisan judiciary take care of such sensitive investigations. It seems to be forgotten that the Supreme Court itself in Vineet Narain [while dealing with the Jain Hawala Diaries] repeatedly emphasised on how the ad-hoc procedure it created was not ideal and in fact showed the necessity for immediate structural changes in our investigative agencies. Simply put, handling investigations ought not to be the Court's job. The dismissal of the request for a probe can be given a positive spin - the Court puts the foot down and presses for changes that India's investigative agencies so desperately require. The lamentable state of affairs is summed up nicely by the case at hand: the Writ Petition here was filed in 2015 alleging corruption surrounding the appointment of the Chief Vigilance Commissioner, head of the institution that birthed from the ashes of Vineet Narain. Lets hope the future contains fewee false dawns.

Saturday, January 7, 2017

Snippet - Constitutional Evasion and the CBI's Dubious Legal Basis

The Indian Constitutional Law and Philosophy Blog put up an important and timely opinion on what appears to be an emerging doctrine of constitutional evasion, where the Supreme Court is creating an effect by simply not deciding issues of seminal constitutional importance. Demonetisation and Aadhar were taken as two examples, and in this snippet I offer a third - the legal status of the Central Bureau of Investigation.  

The CBI is a curious entity and was once before the subject of a Guest Post on this Blog. It does not have any statutory basis and traces its foundation to a Notification passed in 1963 (Resolution No. 4/31/61-T dated 01.04.1963). Its precursor was the Delhi Special Police Establishment [DSPE], created under the eponymous 1946 statute. The CBI started out under the control of the Ministry of Home Affairs, but Granville Austin in Working a Democratic Constitution notes how the Prime Minister came to exercise far greater control over the Agency during Mrs. Gandhi's tenure at the helm (pages 190-191) and then went back to the Home Ministry under the Janata Government (pages 454-455). He also notes how the Agency was often used to carry out political vendetta in the 1970s, both by the Congress as well as the Janata Governments. The lack of autonomy in the CBI has been a consistent theme in the five decades since, perceived to be constantly trading allegiances, with echoes being seen by papers in the raids conducted in the office of the Delhi Chief Minister in 2015. Nobody likes being maligned, and the CBI itself made calls for greater autonomy with past directors advocating the cause for the Agency to have a statutory basis. The Supreme Court has also been sympathetic to these pleas. It expressed great displeasure upon learning that CBI recommendations had been changed at the behest of ministers in relation to the coal blocks allocation scam, and went ahead and conferred greater autonomy to the Agency in September 2013.  

So far so good. On 06.11.2013, then, the Guwahati High Court famously passed an order holding the CBI was without any legal basis. In an impeccably reasoned decision, the Court held that the CBI could not be located in the DSPE Act. The Guwahati High Court did find the CBI to be distinct from the DSPE after tracing its legislative history as found in the file notings itself (paragraphs 45-49), contrary to what the Union of India asserted. Such an independent police force which conducted investigations and inquiries required statutory backing, and could not be the product of a mere Executive Notification. It refused to lend weight to an argument made by the Union which effectively sought non-interference despite illegality as things had remained this way for decades. In another part of the decision, the Court traced the Constituent Assembly Debates on the subject to show how the Framers never intended to confer investigative powers upon a Central Agency as has been done today (paragraphs 51 - 68), but it did not go ahead and consider the legality of the DSPE itself. 

On 09.11.2013, in a hearing conducted at the residence of the then Chief Justice, the Supreme Court stayed the decision [order available here]. This was understandable and fair, as thousands of investigations and prosecutions would have been thrown into the lurch if the CBI was suddenly disbanded. The problem is the lack of activity that the petition has subsequently witnessed in the Supreme Court, which is where the issue of Constitutional Evasion comes in. The case [SLP (Civil) 34834/2013], along with connected petitions, has been listed a total of eight times since 2013. Long dates came between the filing of submissions etc with the stay remaining operative. The order passed on 15.02.2016 converted the case to Civil Appeal No. 1473/2016 and notes that the hearing was expedited, but no subsequent date was given. On 11.11.2016, applications for vacating the stay were dismissed. No likely date of next listing shows up on the case status webpage as of today.

By prolonging the stay and refusing to hear the matter, the Court is inadvertently supporting the claim of the Union of India that things should not be interfered merely because they have been so. Rather, it would be in the national interests for a speedy resolution of these issues of seminal constitutional importance, that plague the premier investigating agency of India. 

Aircel-Maxis, International Law and Judicial Restraint

A Three Judge Bench of the Supreme Court today passed this six page long order in an application filed by the Centre for Public Interest Litigation which sought directions in the Aircel-Maxis case. The order made headlines in India (Hindu, Business-Standard, NDTV, Indian Express) with extracts of the terse observations in the order being carried. Most of these are focused on the conclusions in paragraph 10 that the sale of spectrum remains stayed. As I explore in this post, the Order is extremely troubling, illegal, contrary to national and international law, and yet another instance of the White Knight complex that many people have so often written about.

What's the case about and Why was there a Petition in the Supreme Court?
Not so long ago in 2012, the corruption scandal surrounding allocation of 2-G spectrum arrived on the scene and refuses to leave. Investigations are still on-going and are linking supplementary sales of spectrum to be part of the initial scam that allegedly involved Shahid Balwa, Sanjay Chandra, A. Raja and the like. One of these linked cases concerns the sale of spectrum by Aircel to Maxis in 2006. The CBI has alleged that this sale was vitiated by corruption and has filed a chargesheet against Dayanidhi Maran (the then Minister for Communications), Aircel, Maxis, and the responsible officers of these companies. The case is currently pending at the stage of charge before the Special Court hearing 2-G Scam cases in Patiala House, New Delhi. 

The 2-G Scam petition itself was filed in 2010 and continues to be pending. This Application - filed by the Centre for Public Interest Litigation - sought directions to prevent the sale of spectrum by Aircel-Maxis that was said to be on the cards. The Application stated (as per news reports) that allowing the sale would mean the accused persons would profit despite not appearing before the courts despite summons having been issued against them [This Blog had earlier discussed the issue of summoning foreign entities here].

The Order Passed Today
The news media reports on proceedings as they happen inside court and often differ from the eventual order that is published for proceedings online. Something like this seems to have happened here as well, but not to a great extent. Naturally, all that matters is what is in the order itself. 

The Court notes the background:

3. The predicament expressed in I.A.No.82/2016, and the eventual prayer made therein, emerges on account of non-service of summons on Mr. Ananda Krishna Tatparanandam (Accused No.iv) and M/s. Maxis Communications, Berhad, Malaysia (Accused No.vii), and the other accused referred to above (Accused No.iii and vi). 

4. In so far as, the instant aspect of the matter is concerned, the factual position depicted in the reply affidavit, filed on behalf of the Central Bureau of Investigation, reveals as under : “21. That on 31.08.2016, a letter was received by the Ld. Special judge from the Attorney General's Chambers, Malaysia, dated 17.08.2016, inter alia stating that upon consideration of the facts disclosed in the Request for Assistance and further clarifications supplied by the CBI, the requirements as per the provisions under section 20(1)(f) of the Mutual Assistance in Criminal Matters Act, 2002 [Act 621] were not fulfilled, and hence the requests to serve the summons could not be acceded to.” 

So, the Malaysia-based accused persons (not Indian) had not appeared in court due to non-service of summons. In cases like this, when investigation requires processes to happen in another country, we resort to Mutual Legal Assistance Treaties. India and Malaysia have one such Treaty, and the service of summons etc. would have to comply with this in order for summons to be served. If not, the recipient country is under no obligation to enforce service of summons. The Malaysian Act of 2002 referred to is the Malaysian domestic law on how to treat requests by Treaty states for assistance in criminal matters. Section 20 specifies when assistance is to be refused by the Attorney General, and 20(1)(f) states that the request for assistance shall be refused if the Attorney General is of the opinion that "the request relates to the investigation, prosecution or punishment of a person in respect of an act or omission that, if it had occurred in Malaysia, would not have constituted an offence against the laws of Malaysia". Paragraph 4 extracted above shows that non-compliance with this provision is what prevented the service of summons rather than the accused persons wilfully avoiding the process of law. Basically, it shows that the CBI is yet to satisfy the Malaysian Attorney General's office that the acts/omissions alleged are also crimes under Malaysian law.  

In the next paragraph, the Court notes:

5. It is imperative to ensure, in our considered view, that the process of law should not be permitted to be frustrated by non-service of summons to the accused. In order to enforce the presence of accused ... we propose to restrain, earning of any revenue, by using the 2G Spectrum licenses, which were originally granted to M/s Aircel Communications ...

The Court has permitted the accused to make representations before the Special Court (paragraph 8), and has instructed the Union of India to ensure publication of this order in two leading Malaysian newspapers (paragraph 9). Starkly, the Court states that "it will not be open to any of the accused, to raise an objection with reference to any monetary loss, emerging out of the proposed order."  

And All That is Wrong With it
A non-sequitur if there ever was one. That, in short, sums up what has happened here. After all, how else can one explain the Court noting in paragraph 4 that the non-service of summons is due to a failure on part of the Union to fulfil the requirements of the Mutual Legal Assistance Treaty, and then moving on to squarely placing the blame on the accused persons for their fault of residing abroad.

The Court seems to have conflated the domestic methods of ensuring service of summons as provided under Chapter VI of the Criminal Procedure Code 1973 [Cr.P.C.] with such process as applicable under international law which are covered in Chapter VII. This is apparent with the Court suggesting publication in Malaysian newspapers as if it were dealing with an issue of proclamations for absconders under Sections 82 and 83 of the Cr.P.C. If we go a bit further and see Section 105 Cr.P.C., it provides for the specific manner in which this service of summons must happen. 

Now, someone may argue that Article 142 allows the Supreme Court to do nearly anything it wishes so why not this? Well, while I strongly resist that submission itself and argue that nothing in Article 142 allows the Court to transgress existing statutory law, that still does not justify the violation of International Law. Adopting this ad-hoc method for serving summons and processes would violate India's obligations under the Mutual Legal Assistance Treaty with Malaysia. Action taken pursuant to these orders by the Indian authorities would be open to challenge, though I am not an expert on what shape that challenge may take. 

I still cannot understand the conclusions that the Court arrives at. But if we return to the idea that the judiciary has been burdened with expectations of cleaning up the system of corruption (White Knight complex), it definitely makes sense. So what if the Executive is proving unable to comply with the law? Or, in case of the National Anthem Order, what if the Executive wants to do something but is fettered by the law. The Judiciary seems to suggest that it is willing to go ahead and change the law itself, all for the cause of Justice. One interim order at a time - but please, no final judgments.

[this post was updated on 7 January to add the portions on the Malaysian Mutual Assistance in Criminal Matters Act of 2002]