VINEET NARAIN AND ORS. v. UNION OF INDIA AND ANR.

I l A This is, therefore, an area where the opinion of persons with requisite expertise in decision making of that kind is relevant and, may be even decisive in reaching the conclusion whether the allegation requires any investigation to he made. In view of the fact that the CBI or the Police force does not have the expertise within its fold for the formation of the requisite opinion in such cases, the need for the inclusion of such a B mechanism comprising of experts in the field as a part of the infrastructure of the CBI is obvious, to decide whether the accusation made discloses grounds for a reasonable suspicion of the commission of an offence and it requires investigation. In the absence of any such mechanism within the infrastructure of the CBI, comprising of experts in the field who can evaluate the material for the decision to be made, introduction therein of a body of experts having expertise of the kind of business which requires the decision to be made, can be appreciated. But then, the final opinion is to be of the CBI with the aid of that advice and not that of anyone else. It would be more appropriate to have such a body within the infrastructure of the CBI itself.

The Single Directive cannot, therefore, be upheld as valid on the ground of it being permissible in exercise of the power of superintendence of the Central Government under Section 4(1) of the Act. The matter has now to be considered de hors the Single Directive. E Power of tlze Supreme Court

In view of the common perception shared by everyone including the Government of India and the Independent Review Committee (IRC) of the need for insulation of the CBI from extraneous influence of any kind, F it is imperative that some action is urgently taken to prevent the con- tinuance of this situation with a view to ensure proper implementation of the rule of law. This is the need of equality guaranteed in the Constitution. The right to equality in a situation like this is that of the Indian polity and not merely of a few individuals. The powers conferred on this Court by the G Constitution are ample to remedy this defect and to ensure enforcement of the concept of equality.

There are ample powers conferred by Article 32 read with Article 142 to make orders which have the effect of law by virtue of Article 141 and there is mandate to all authorities to act in aid of the orders of this H Court as provided in Article 144 of the Constitution. In a catena of

VINEETv. U.O.L[VERMA, CJ.] 641

decisions of this Court, this power has been recognised and exercised, if A need be, by issuing necessary directions to fill the vacuum till such time the legislature steps in to cover the gap or the executive discharges its role. It is in the discharge or this duty that the IRC was constituted by the Government of India with a view to obtain its recommendations after an indepth study of .the problem in order to implement them by suitable executive directions till proper legislation is enacted. The report of the IRC B has been given to the Government of India but because of certain difficul- ties in the present context, no further action by the executive has been possible. The study having been made by a Committee considered by the Government of India itself as an expert body, it is safe to act on the recommendations of the IRC to formulate the directions of this Court, to the extent they are of assistance. In the remaining area, on the basis of the c study of the IRC and its recommendation, suitable directions can be formulated to fill the entire vacuum. This is the exercise we propose lo perform in the present case since this exercise can no longer be delayed. It is essential and indeed the constitutional obligation of this Court under the aforesaid provisions to issue the necessary directions in this behalf. We D now consider formulation of the needed directions in the performance of this obligation. The directions issued herein for strict compliance are to operate till ,;uch time as they are replaced by witahlc legislation in this behalf.

There is another aspect of rule of law which is of equal significance. E Unless a proper investigation is made and it is followed by an equally proper prosecution, the effort made would not bear fruition. The recent experience in the field of prosecution is also discouraging. To emphasise this point, some reference has to be made to a large number of prosecu- tions launched as a result of monitoring by the court in this matter which F have resulted in discharge of the accused at the threshold. It took several years for the CBI to commence investigation and that too as a result of the monitoring by this Court. It is not as if the CBI, on conclusion of the investigation, formed the opinion that no case was made out for prosecu- tion so that the earlier inaction may have been justified. The CBI did file numerous chargesheets which indicated that in its view a p1ima facie ca'e G for prosecution had been made out. This alone is sufficient to indicate that the earlier inaction was unjustified. However, discharge of the accused on filing of the chargesheet indicates, irrespective of the ultimate outcome of the matters pending in the higher courts, that the trial court at least was not satisfied that a p1ima facie case was made out by the investigation. H

p. 642

A These facts are sufficient to indicate that either the investigation or the prosecution or both were lacking. A similar result of discharge of the accused in such a large number of cases where chargesheets had been filed by the CBI is not consistent with any other inference. The need for a strong and competent prosecution machinery and not merely a fair and competent investigation by the CBI can hardly be overemphasised. This is the occasion for us to take the view that a suitable machinery for prosecution of the cases filed in court by the CBI is also essential to ensure discharge of its . full responsibility by the CBI. Unless a competent prosecution follows a fair and competent investigation, the exercise in the ultimate analysis would • be futile. Investigation and prosecution are inter-related and improvement of investigation without improving the prosecution machinery is of no practical significance. We would, therefore, consider the aspect of prosecu- tion also in the formulation of the guidelines.

In exercise of the powers of this Court under Article 32 read with D Article 142, guidelines and directions have been issued in a large number of cases and a brief reference to a few of them is sufficient. In Erach Sai11 Kanga Etc. v. U11io11 of India & A11r., (Writ Petition No. 2632 of 1978 Etc. Etc.) decided on 20th March, 1979, the Constitution Bench laid down certain guidelines relating to Emigration Act. In Lakshmi Kant Pa11dey v. E U11iv11 of I11dia, (i11 re: Foreig11 Adoptio11), (1984) 2 sec 244, guidelines for adoption of minor children by foreigners were laid down. Similarly in State of West Bengal & Ors. Etc. v. Sampat Lal & Ors. Etc., (1985) 2 SCR 256, K Veeraswami v. U11io11 of India and Others, (1991) 3 SCC 655, U11io11 Carbide Corporatio11 and Others V. U11io11 of India and Others, (1991) 4 sec 584, F Delhi Judicial Se1vice Association Etc. v. State of Gujarat a11d Others Etc. (Nadiad Case), (1991) 4 SCC 406, DeU1i Development Authority v. Skipper Const111ctio11 Co. (P) Ltd. A11d Another, (1996] 4 SCC 622 and Di11esh Trivedi, M.P. and Others v. U11io11 of India a11d Others, (1997) 4 SCC 306, guidelines were laid down having the.· effect of law, requiring rigid compliance. In Supreme Cowt Advocates-011- Record Associatio11 a11d G Others V. Union of India (II11d Judges case), (1993) 4 sec 441, a Nine Judge Bench laid down guidelines and norms for the appointment and transfer of Judges which are being rigidly followed in the matter of appointments of High Court and Supreme Court Judges and transfer of High Court Judges. More recently in Vishakha a11d Others v. State of Rajasthan and H Others, (1997) 6 sec 241, elaborate guidelines have been· laid down for . "'-

VINEETv. U.O.I.(VERMA, CJ.] 643

observance in work places relating to sexual harassment of working women. A In Vishaka, it was said :

"The obligation o~ this court under Article 32 of the Constitu- tion for the enforcement of these fundamental rights in the absence of legislation must be viewed along with the role of judiciary envisaged in the Beijing Statement of Principles of the Inde- B pendence of the .Judiciary in the LAWASIA region. These prin- ciples were accepted by the Chief Justices of Asia and the Pacific at Beijing in 1995(*) (As amended at Manila, 28th August, 1997] as those representinz the minimum standards necessary to be ob- served in order to maintain the independence and effective c functioning of the judiciary. The objectives of the judiciary men- tioned in the Beijing Statement are :

"Objectives of the Judiciary : D

10. The objectives and functions of the Judiciary include the following;

(a) to ensure that all persons are able to live securely under the Rule of Law; E (b) to promote, within the proper limits of the judicial function, the observance and the attainment of human rights; and

(c) to administer the law impartially among persons and between persons and the State." F Thus, an exercise of this kind by the court is now a well settled practice which has taken firm roots in our constitutional jurisprudence. This exer- cise is essential to fill the void in the absence of suitable legislation to c:over the field.

As pointed out in Vishakha (supra), it is the duty of the executive to G fill the vacuum by executive orders because its field is coterminous with that the legislature, and where there is inaction even by the executive for whatever reason, the judiciary must step in, in exercise of its constitutional obligations under the aforesaid provisions to prm~de a solution till such time as the legislature acts to perform its role hy enacting proper legislation H

p. 644

A to cover the field. On this basis, we now proceed to give the directions enumerated hereafter for rigid compliance till such time as the legislature steps in to substitute them by proper legislation. These directions made under Article 32 read with Article 142 to implement the rule of law wherein the concept B of equality enshrined in Article 14 is embedded, have the force of law under Article 141 and by virtue of Article 144, it is the duty of all authorities. civil and judicial, in the territory of India to act in aid of this Court. In the issuance of these directions, we have accepted and are reiterating as. far as possible the recommendations made by the IRC. c It is a similar perception in England which has led to the constitution of a Committee headed by Lord Nolan on 'Standards in Public Life'. In Volume 1 of Lord Nolan's Report (1995), the general recommendations made.are:

D General reco1111i1endations

4. Some of our conclusions have general application across the entire service :

P1i11ciples of public life E

5. The general principles of conduct which underpin public life need to be restated. We have done this. The seven principles of selflessness, integrity, objectivity, accountability, openness, honesty and leadership are set out in full on page 14.

F Codes of Conduct

6. All public bodies should draw up Codes of Conduct incorporat- ing these principles.

!11depe11de11t Scmtiny G

7. Internal systems for maintaining st;indards should be supported by independent scrutiny.

Education

H 8. More needs to be done to promote and reinforce standards of

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VINEETv. U.O.I.[VERMA, CJ.] 645

conduct in public bodies, in particular through guidance and A training, including induction training."

The Seven Principles of Public Life are stated in the Report by Lord Nolan, thus :

"The .Seven P1inciples of Public Life B

Selflessness

Holders of public office should take decisions solely in terms of the public interest. They should not do so in order to gain financial or other material benefits for themselves, their family, c or their friends.

lntqpity ·v Holders of public office should not place themselves under any D financial or other obligation to outside individuals or organisation that might influence them in the performance of their official duties.

Objectivity E In carrying out public business, including making public appointments, awarding contracts, or recommending individuals for rewards and benefits, holders of public office should make choices on merit.

Accountability F

Holders of public office are accountable for their decisions and actions to the public and must submit themselves to whatever scrutiny is appropriate to their office.

Openness G

Holders of public office should be as open as possible about all the decisions and actions that they take. They should give reasons for their decisions and restrict information only when the wider public interest clearly demands. H

p. 646

A Honesty

Holders of public office have a duty to declare any private interests relating to their public duties and to take steps to resolve any conflicts arising in a way that protects the public interest. B Leadership

Holders of public office should promote and support these-principles by leadership and example." c These principles of public life are of general application in every democracy and one is expected to bear them in mind while scrutinising the conduct of every holder of a public office. It is trite that the holders of public offices are entrusted with certain power to be exercised in public ..... interest alone and, therefore, the office is held by them in trust for the \

D people. Any deviation from the path of rectitude by any of the them amounts to a breach of trust and must be severely dealt with instead of being pushed under the carpet. If the conduct amounts an offence, it must be promptly investigated and the offender against whom aprima facie case is made out should be prosecuted expeditiously so that the majesty of law is upheld and the rule of law vindicated. It is the duty of the judiciary to enforce the rule of law and, therefore, to guard against erosion of the rule of law.

The adverse impact of lack of probity in public life leading to a high degree of corruption is manifold. It also has adverse effect ori foreign investment and funding from the International Monetary Fund and the Wor\d Bank who have warned that future aid to under-developed countries may be subject to the requisite steps being taken to eradicate corruption, which prevents international aid from reaching those for whom it is meant. Increasing corruption has led to investigative journalism which is of value to a free society. The need to highlight corruption in public life through the medium of public interest litigation invoking judicial review may be frequent in India but is not unknown in other countries : R v. Secretary of State for Foreign and Commonwealth Affair~~ (1955) 1 WLR 386.

H Of course, the necessity of desirable procedures evolved by court

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VINEETv. U.O.I.[VERMA, CJ.] 647

rules to ensure that such a litigation is properly conducted and confined only to matters of public interest is obvious. This is the effort made in these proceedings for the enforcement of fundamental rights guaranteed in the Constitution in exercise of powers conferred on this Court for doing complete justice in a cause. It cannot be doubted that there is a serious human rights aspect involved in such a proceeding because the prevailing corruption in public life, if permitted to continue unchecked, has ultimately the deleterious effect of eroding the Indian polity.

As a result of the aforesaid discussion, we hereby direct as under :-

I CENTRAL BUREAU OF INVESTIGATION (CBI) AND C CENTRAL VIGILANCE COMMISSION (CVC)

1. The Central Vigilance Commission (CVC) shall be given statutory status. D

2. Selection for the post of Central Vigilance Commissioner shall be made by a Committee comprising the Prime Minister, Home Minister and the Leader of the Opposition from a panel of outstanding civil servants and others with impeccable integrity, to be furnished by the Cabinet Secretary. The appointment shall be made by the President on the basis of the recommendations made by the Committee. This shall be done immediately.

3. The CVC shall be responsible for the efficient functioning of the CBI. While Government shall remain answerable for the CBI's functioning, to introduce visible objectivity in the mechanism to be established for overviewing the CBI's working, the CVC shall be entrusted with the responsibility of superintendence over the CBl's functioning. The CBI shall report to the eve about cases taken ~p by ~t for invesrigation; progress of investigations; cases in which chargesheets are filed and their progress. The CVC shall review the progress of all cases moved by the CBI for sanction of prosecution of public servants which are pending with the competent authorities, specially those in which sanction has been delayed or refused.

4. The Central Government shall take all measures necessary to ensure that the CBI functions effectively and efficiently .and is viewed as a non-partisan agency. H

p. 648

A 5. The CVC shall have a separate section in its Annual Report on the CBJ's functioning after the supervisory function is transferred to it.

66. Recommendations for appointment of the Director, CBI shall be made by a Committee headed by the Central Vigilance Commissioner with the Home Secretary and Secretary (Personnel) as members. The views of B the incumbent Director shall be considered by the Committee for making the best choice. The Committee shall draw up a panel of JPS officers on the basis of their seniority, integrity, experience in investigation and anti- corruption work. The final selection shall be made by the Appointments Committee of the Cabinet (ACC) from the panel recommended by the C Selection Committee. If none among the panel is found suitable, the reasons thereof shall be recorded and the Committee asked to draw up a fresh panel.

77. The Director, CBI shall have a minimum tenure of two years, D regardless of the date of his superannuation. This would ensure that an officer suitable in all respects is not ignored merely because he has less than two years to superannuate from the date of his appointment.

88. The transfer of an incumbent Director, CBI in an extraordinary situation, including the need for him to take up a more important assign- E ment, should have the approval of the Selection Committee.

99. The Director, CBI shall have full freedom for allocation of work within the agency as also for constituting teams for investigations. Any change made by the Director, CBI in the Head of an investigative ttcam p should be for cogent reasons and for improvement in investigation, the reasons being recorded.

1010. Selection/extension of tenure of officers upto the level of Joint Director (JD) shall be decided by a Board comprising the Central Vigilance Commissioner, Home Secretary and Secretary (Personnel) ,with G the Director, CBI providing the necessary inputs. The extension of tenure or premature repatriation of officers upto the level of Joint Director shall be with final approval of this Board. Only cases pertaining lo the appoint- ment or extension of tenure of officers of the rank of Joint Director or above shall be referred to the Appointments Committee of the Cabinet H (ACC) for decision.

VJNEETv. U.0.1.[VERMA, CJ.j 649

1111. Proposals for improvement of infrastructure, methods of inves- A ligation, etc. should be decided urgently. In order to strengthen CBI's in-house expertise, professionals from the revenue, banking and security sectors should be inducted into the CBI.

1212. The CBI Manual based on statutory provisions of the Cr.P.C. provides essential guidelines for the CB I's functioning. It is imperative that B the CBI adheres scrupulously to the provisions in the Manual in relation to its investigative functions, like raids, seizure and arrests. Any deviation from the established procedure should be viewed ~eriousl;- and severe disciplinary action taken against the concerned officials.

1313. The Director, CBI shall be responsible for ensuring the filing of . c chargesheets in courts within the stipulated time limits, ;nd the matter should be kept under constant review by the Director, CBI.

1414. A document on CBI's functioning should be published within three months to provide the general public with a feedback on investiga- D lions and information for redress of genuine grievances in a manner which does not compromise with the operational requirements of the CBI.

1515. Time limit of three months for grant of sanction for prosecution must be strictly adhered to. However, additional time of one month may be allowed where consultation is required with the Attorney General (AG) E or any other law officer in the AG's office.

1616. The Director, CBI should conduct regular appraisal of personnel to prevent corruption and/or inefficiency in the agency.

II. ENFORCEMENT DIRECTORATE F

l. A Selection Committee headed by the Central Vigilance Commis- sioner and including the Home Secretary, Secretary (Personnel) and Revenue Secretary, shall prepare a panel for appointment of the Director, Enforcement Directorate. The appointment to the post of Director shall G be made by the Appointment~ Committee of the Cabinet (ACC) from the panel recommended by the Selection Committee.

2. The Director, Enforcement Directorate like the Director, CBI shall have a minimum tenure of two years. In his case also, premature transfer for any extraordinary reason should be approved by the aforesaid H

p. 650

A Selection Committee headed by the Central Vigilance Commissioner.

3. In view of the importance of the post of Director, Enforcement Directorate, it shall be upgraded to that of an Additional Secretary/Special Secretary to the Government.

B 4. Officers of the Enforcement Directorate handling sensitive assign- ments shall be provided adequate security to enable them to discharge their functions fearlessly.

5. Extensions of tenure upto the level of Joint Director in the Enforcement Directorate should be decided by the said Committee headed c by the Central Vigilance Commissioner.

6. There shall be no premature media publicity by the CBI/Enforce- ment Directorate.

7. Adjudication/commencement of prosecution shall be made by the D Enforcement Directorate within a period of one year.

8. The Director, Enforcement Directorate shall monitor and ensure speedy completion of investigations/adjudications and launching of prosecutions. Revenue Secretary must review their progress regularly. E 9. For speedy conduct of investigations abroad, the procedure to approve filing of applications for Letters Rogatory shall be streamlined and, if necessary, Revenue Secretary authorised to grant the approval.

10. A comprehensive circular shall be published by the Directorate F to inform the public about the procedures/systems of its functioning for the sake of transparency.

11. In-house legal advice mechanism shall be strengthened by ap- pointment of competent legal advisers in the CBI/Directorate of Enforce- ment. G

12. The Annual Report of the Department of Revenue shall contain a detailed account on the working of the Enforcement Directorate.

Ill. NODAL AGENCY

H 1. A Nodal Agency headed by the Home Secretary with Member

VINEETv. U.O.L[VERMA, C.J.] 651

(Investigation), Central Board of Direct Taxes, Director General, Revenue A Intelligence, Director, Enforcement and Director, CBI as members, shall be constituted for coordinated action in cases having politico-bureaucrat- criminal nexus.

2. The Nodal Agency shall meet at least once every month. B

3. Working and efficacy of the Nodal Agency should be watched for about one year so as to improve it upon the basis of the experience gained within this period.

IV. PROSECUTION AGENCY c L A panel of competent lawyers of experience and impeccable reputation shall be prepared with the advice of the Attorney General. Their services shall be utilised as Prosecuting Counsel in cases of significance. Even during the course of investigation of an offence, the advice of a lawyer chosen from the panel should be taken by the CBI/Enforcement Direc- D tor ate.

2. Every prosecution which results in the discharge or acquittal of the accused must be reviewed by a lawyer on the panel and, on the basis of the opinion given, responsibility should be fixed for dereliction of duty, if any, of the concerned officer. In such cases, strict action should be taken against the officer found guilty of dereliction of duty.

3. The preparation of the panel of lawyers with the approval of the Attorney General shall be completed within three months.

4. Steps shall be taken immediately for the constitution of an able and impartial agency comprising persons of unimpeachable integrity to perform functions akin to those of the Director of Prosecutions in U.K. On the constitution of such a body, the task of supervising prosecutions launched by the CBI/Enforcement Directorate shall be entrusted to it. G

5. Till the constitution of the aforesaid body, Special Counsel shall be appointed for the conduct of important trials on the recommendation of the Attorney General or any other law officer designated by him.

The learned amicus rnriae had urged us to issue directions for the appointment of an authority akin to the Special or Independent Counsel H

p. 652

A in the United States of America for the investigation of charges in politi- cally sensitive matters and for the prosecution of those cases and to ensure that appointments to sensitive posts in the CBI and other enforcement agencies and transfers therefrom were not made hy the political executive. We are of the view that the time for these drastic steps has not come. It is our hope that it never will, for we entertain the belief that the investigative B agencies shall function far better now, having regard to all that has hap- pened since these writ petitions were admitted and to the directions which arc contained in this judgment. The personnel of the enforcement agencies should not now lack the courage and independence to go about their task as they should, even where those to be investigated are prominent and c powerful persons.

In view of the problem in the States being even more acute, as elaborately discussed in the Report of the National Police Commission (1979); there is urgent need for the State Governments also to set up credible mechanism for selection of the Police Chief in the States. The Central Government must pursue the matter with the State Governments and ensure that a similar mechanism, as indicated above, is set up in each State for the selection/appointment, tenure, transfer and posting of not merely the Chief of the State Police but also all police officers of the rank of Superintendent of Police and above. It is shocking to hear, a matter of common knowledge, that in some States the tenure of a Superintendent of Police is on an average only a few months and transfers are made for whimsical reasons. Apart from demoralising the police force, it has also the adverse effect of politicizing the personnel. It is, therefore, essential that prompt measures are taken by the Central Government within the ambit of their constitutional powers in the federation to impress upon the F State Governments that such a practice is alien to the envisaged constitu- tional machinery. The situation described in the National Police Commission~s Report (1979) was alarming and it has become much worse by now. The desperation of the Union Home Minister in his letters to the State Governments, placed before us at the hearing, reveal a distressing G situation which must be cured, if the rule of law is to prevail. No action within the Constitutional Scheme found necessary to remedy the situation is too stringent in these circumstances.

In the result, we strike down Directive No. 4.7(3) of the Single H Directive quoted above and issue the above directions, which have to be

VINEETv. U.0.1.[VERMA, CJ.] 653 construed in the light of the earlier discussion. The Report of the Inde- A pendent Review Committee (IRC) and its recommendations which arc similar to this extent can be read, if necessary, for a' proper appreciation of these directions. To the extent we agree with the conclusions and recommendations of the IRC, and that is a large area, we have adopted the same in the formulation of the above direct.ions. These directions require the strict compliance/adherence of the Union of India and all B concerned.

The writ petitions are disposed of in the above terms.

Oiminal Misc. Petition Nos. 5879-5882 of 1997 c In view of the disposal of the writ petitions in the manner indicated above and in the facts and circumstances of the case, we do not consider it necessary now to examine the appointment of Shri R.C. Sharma as Director, CBI. Moreover, the tenure of Shri Sharma as Director, CBI is to end soon. We make it clear that Shri Sharma is not to be continued as CBI D Director beyond the date of expiry of his present tenure. Accordingly, these Cr!. M. Ps. are disposed of in this manner.

In view of the withdrawal of C.W.P. No. 2992 of 1997 in the Delhi High Court as required by this Court's order dated 11.9.1997, no further order for the disposal of C.W.P. No. 2992 of 1997 is necessary.

S.M. Petitions disposed of.

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