Supreme Court Upholds FIR Against Public Servant in Disproportionate Assets Case: Preliminary Inquiry Not Mandatory.


08 April 2025 Corruption >> Criminal Law   |   Criminal Appeals & Suspension of Sentence >> Criminal Law   |   FIR >> Criminal Law  

The Supreme Court of India has overturned an order by the Karnataka High Court that had quashed proceedings against a public servant accused of possessing disproportionate assets. The apex court, in its recent judgment, clarified that while a preliminary inquiry in corruption cases is often desirable, it is not a mandatory prerequisite for registering a First Information Report (FIR) under the Prevention of Corruption Act, 1988.

The case originated from an FIR registered against Sri Channakeshava H.D., an Executive Engineer at Bangalore Electricity Supply Corporation (BESCOM), for allegedly amassing wealth beyond his known sources of income during his tenure as a public servant since 1998. The Karnataka Lokayukta police registered the FIR in December 2023, initiating an investigation into the allegations of disproportionate assets.


 

 

Subsequently, Sri Channakeshava approached the Karnataka High Court seeking to quash the FIR, primarily arguing that the investigation was initiated in violation of Section 17 of the PC Act. This section mandates that offences under Section 13(1)(b) of the Act, which pertains to criminal misconduct by a public servant by illicitly enriching themselves, cannot be investigated without an order from a police officer of the rank of Superintendent of Police (SP) or above. The High Court's learned Single Judge, while acknowledging that an order was indeed issued by the SP before the FIR was lodged, quashed the proceedings. The High Court reasoned that the SP had not conducted any preliminary inquiry before issuing the order, indicating a lack of application of mind.

Challenging this decision, the State of Karnataka argued before the Supreme Court that a preliminary inquiry, although desirable in corruption cases as highlighted in previous Supreme Court judgments like Lalita Kumari v. Government of Uttar Pradesh & Ors. (2014) and P. Sirajuddin v. State of Madras (1970), is not a mandatory requirement under the PC Act. The State contended that in the present case, the SP's order for registration of the FIR was based on a detailed "source report" dated October 5, 2023, which provided sufficient material for the SP to form a prima facie view of a cognizable offence.

The source report, prepared by a Deputy Superintendent of Police (DSP), detailed the alleged disproportionate assets acquired by Sri Channakeshava, estimating them to be around Rs. 6.64 crore, approximately 92.54% beyond his known income during the period of scrutiny (1998-2023). The report also suggested the possibility of the accused possessing further undisclosed assets.

The Supreme Court, after considering the arguments and relevant precedents, including its recent judgment in State of Karnataka v. T.N Sudhakar Reddy (2025 SCC OnLine SC 382) and CBI v. Thommandru Hannah Vijayalakshmi (2021) 18 SCC 135, ruled in favor of the State of Karnataka.

The apex court reiterated that while Lalita Kumari categorized corruption cases as those where a preliminary inquiry "may be made," the use of the term "may" signifies that such an inquiry is discretionary and not obligatory. The court further emphasized the principle established in T.N Sudhakar Reddy that if a senior officer possesses a detailed and well-reasoned source information report that prima facie discloses a cognizable offence, a preliminary inquiry can be avoided.

Addressing the respondent's argument that he was not given an opportunity to explain his position before the FIR was registered, the Supreme Court cited its decision in Thommandru Hannah Vijayalakshmi, affirming that an accused public servant has no inherent right to be heard at the stage of FIR registration.

In its final order, the Supreme Court held that considering the detailed source report available to the SP, which formed the basis of the order for FIR registration, a preliminary inquiry was not mandated in this specific case. The court found that the High Court erred in quashing the FIR. Consequently, the Supreme Court allowed the appeal filed by the State of Karnataka and set aside the High Court's order.

This judgment clarifies the legal position regarding the necessity of a preliminary inquiry in corruption cases under the PC Act, emphasizing that while desirable, it is not a mandatory step if sufficient credible information exists to warrant the registration of an FIR.


  Section 17, Prevention of Corruption Act - 1988  

  Prevention of Corruption Act, 1988