1. In this writ petition the petitioner has challenged the orders passed by the Metropolitan Magistrate, 25th Court, Mazagaon, Bombay, dated 20th December, 1983, dismissing the applications filed by him raising certain preliminary objections.
2. It appears from the record that criminal proceedings are instituted against the petitioner after obtaining sanction from the Deputy Commissioner of Sales Tax (A), Enforcement, Bombay City Division, under section 63(2)(i), 63(4) and 63(8)(i) of the Bombay Sales Tax Act, 1959, as amended by the Maharashtra Sales Tax (Amendment) Act, 1981. It appears to be an admitted position that a show cause notice dated 6th May, 1982, was issued to the petitioner calling upon him to show cause as to why a penalty should not be imposed under section 36 of the said Act. Prior to this a complaint was made to the police on 23rd April, 1982, about the offences committed by the petitioner.
3. According to Mr. Kothari, the learned counsel appearing for the petitioner, in substance, the criminal prosecution was launched against the petitioner when the offences complained against him were explained to him on 26th April, 1983. Prior to this, though criminal proceedings were started, in law no charges were levelled against the petitioner. Prior to 26th April, 1983, itself, on 6th May, 1982, a show cause notice to show cause as to why penalty should not be imposed on the petitioner was issued. In view of this, the present prosecution is wholly barred under section 63(14) of the Bombay Sales Tax Act, 1959. He also contended that since the sanction accorded by the Deputy Commissioner of Sales Tax resulted in penal and serious consequences, namely, a criminal prosecution which could result in the sentence of fine or jail, it was obligatory on the part of the Deputy Commissioner of Sales Tax to give an opportunity of being heard to the petitioner before the sanction was accorded. Therefore, the sanction granted is contrary to the principles of natural justice, and on that count also the criminal proceedings instituted against the petitioner are not maintainable. In support of his contentions, Mr. Kothari has placed strong reliance upon the decisions of the Supreme Court in Erusian Equipment and Chemicals v. State of West Bengal : 2SCR674 , State of Punjab v. K. R. Erry : (1973)ILLJ33SC and Swadeshi Cotton Mills v. Union of India : 2SCR533 .
4. On the other hand, it is contended by Mr. Vaidya, the learned Public Prosecutor appearing for the respondents, that the grant of a sanction for prosecution is wholly an administrative act which does not result in any civil or penal consequences. After sanction is granted, a person is prosecuted in a court of law wherein he is given an opportunity to defend himself. In these circumstances, it is not necessary that before according sanction the sanctioning authority should hear the accused or the person against whom prosecution is to be launched. In support of this contention he has placed strong reliance upon the decision of this Court in Parasnath Pande v. The State : AIR1962Bom205 . He then contended that the present prosecution is not barred by section 63(14) of the Bombay Sales Tax Act, 1959, as admittedly in the present case no penalty has been imposed upon the petitioner, either before the prosecution was launched or even thereafter. He also made a statement on behalf of the department that the department is not interested in proceeding further with the penalty proceedings since it has already launched a criminal prosecution.
5. For properly appreciating the controversy raised before us it will be worthwhile to make a reference to the relevant provisions of the Bombay Sales Tax Act, 1959. Chapter VIII of the said Act deals with offences and penalties. Section 63 specifically lays down as to what will be nature of the offences and the penalties. Section 63(14) reads as under :
'(14) No prosecution for an offence against this Act shall be instituted in respect of same facts on which a penalty has been imposed by the Commissioner under any provisions of this Act.'
From the bare reading of this section, it is clear that prosecution is barred in those cases where a penalty has been imposed by the Commissioner under the provisions of the said Act. Such a prosecution is barred if it is in respect of the same facts on which penalty has been imposed. In the present case, admittedly no penalty has been imposed upon the petitioner. Further, complaint to the police was filed on 23rd April, 1982, and thereafter a show cause notice was issued on 6th May, 1982. Therefore, even prior to the issuance of the show cause notice for imposing penalty, criminal proceedings were already instituted. It is also an admitted position that but for issuing the show cause notice on 6th May, 1982, no further proceedings were taken in that behalf, and now a statement is made before us that the department is not interested in proceeding with the penalty proceedings. Therefore, in these circumstances, it can safely be said that the bar contemplated by sub-section (14) of section 63 is not attracted in the present case. Therefore, it is not necessary to deal with the contention raised by Mr. Kothari based on section 300 of the Code of Criminal Procedure or article 20 of the Constitution of India, since the said provisions are not relevant to the controversy raised before us.
6. So far as the second contention raised by Mr. Kothari is concerned, namely, that it was obligatory on the part of the Deputy Commissioner of Sales Tax to give an opportunity of being heard to the petitioner before the sanction was accorded, in our view, there is no substance in the said contention also. Granting of a sanction is an administrative act. While construing a somewhat similar provision in R. S. Nayak v. A. R. Antulay : 1984CriLJ613 , the Supreme Court has observed that the object behind creating a bar to the court from taking cognizance of offences is to save the party from the harassment of frivolous or unsubstantiated allegations. The policy underlying such provisions is that there should not be unnecessary harassment, and this is the reason why in section 67 of the Bombay Sales Tax Act, 1959, it is laid down that no court shall take cognizance of any offence punishable under section 63, 64, or 65 or any Rules made under that Act, except with the previous sanction of the Commissioner. After sanction is accorded, a court can take cognizance of the offence and then start the regular trial wherein the accused is given full opportunity to defend and put forward his case. Therefore, it is not possible for us to import even by the implication the principles of natural justice in this administrative action of granting or refusing sanction. However, it was contended by Mr. Kothari that granting of sanction is a judicial or quasi-judicial act. We find it difficult to subscribe to this contention, since while granting or refusing sanction, the competent authority does not deal with the lis between the parties, nor the rights of the parties are decided. In Matajog Dobey v. H. C. Bhari : 28ITR941(SC) , the Supreme Court observed :
'Whether sanction is to be accorded or not is a matter for the Government to consider. The absolute power to accord or withhold sanction conferred on the Government is irrelevant and foreign to the duty cast on the court, which is the ascertainment of the true nature of the act.'
This clearly shows that the said function is neither judicial nor quasi-judicial. Similar view is taken by this Court is Parasnath v. State : AIR1962Bom205 , wherein it was held that 'grant of sanction is not a judicial act'. The Division Bench also quoted, with approval, the observation of the Madras High Court in Kalagava Bapiah's case ILR (1904) 27 Mad 54. The Madras High Court has also held in the said decision that the sanction accorded by the Government under section 197 of the Code of Criminal Procedure is not null and void for the reason that no notice was given to the accused to show cause why it should not be given. It is a matter left to the discretion of the Government whether such an opportunity should be given to the person concerned before sanctioning the prosecution. The decisions on which reliance is placed by Mr. Kothari are not only distinguishable but are also irrelevant. It is no doubt true that the principles of natural justice apply even to administrative decisions if they involve civil and penal consequences of grave nature, and no full review or appeal on merits against that decision is provided, and the administrative order finally decides the rights. But in this case the accused has a reasonable opportunity of being heard and put forward his case at the trial. In this view of the matter, it is not possible for us to accept this contention of Mr. Kothari.
7. However, it was contended by Mr. Kothari that in similar cases before according sanction show cause notice is normally issued by the department and in this case only such practice was not followed. Therefore, in substance, it is contended by Mr. Kothari that it amounts to discrimination and, therefore, the sanction is violative of article 14 of the Constitution of India. It is not possible for us to accept this contention also in view of the affidavit filed by the Sales Tax Officer, Enforcement Branch. Apart from the fact that general allegations made in this behalf are denied by the respondent, the officer has explained as to why having regard to the facts and circumstances of those cases, the Commissioner thought it fit to issue show cause notices. According to the respondents, the said show cause notices were issued for different purposes and not under section 67 of the Bombay Sales Tax Act, 1959, nor for considering the question of granting sanction for prosecution. They were issued by virtue of the powers vested in the Commissioner under section 69 of the said Act, which are discretionary. It is further contended by the department that the case of the petitioner is not similar or identical to those cases. The department decided to launch prosecution against the petitioner, since there are serious allegations against him, and the department thought that this was a fit case wherein criminal prosecution should be launched against the petitioner. We find much substance in these contentions. Even otherwise, under section 69 the Commissioner is authorised to compound the offences. This compounding could be either before or after the institution of the proceedings, and in the case of minor offences if the Commissioner thinks it fit to issue a show cause notice so as to consider as to whether the offence is a fit one which could be compounded, obviously if the accused is ready to do so, it cannot be said that there is anything illegal in the said procedure. It cannot universally apply to all cases. Further, it was also open to the petitioner to approach the Commissioner, if he was ready and willing to compound the offences. Compounding of offences must ultimately depend upon the facts and circumstances of each case and no general rule can be laid down in that behalf.
8. In the view which we have taken, therefore, we do not find any substance in this writ petition. The rule is discharged.