Gujarat HC upholds Discharge of Oil Companies by Special Judge (CBI) for Selling HSD at Concessional Rate of Sales Tax on ground of Absence of Grave Suspicion [Read Order]

The Gujarat High Court upheld the discharge of oil companies decided by the Special Judge (CBI) for selling High-Speed Diesel (HSD) at a concessional rate of sales tax on the grounds of absence of grave suspicion. 

Central Bureau of Investigation (CBI), the applicant under Criminal Procedure, 1973 as well as under Articles 226/227 of the Constitution of India, had challenged the orders Special CBI Judge for discharging the oil companies. 

The allegation against the officials of four public sector oil companies viz. Indian Oil Corporation Limited (IOCL), Hindustan Petroleum Corporation Limited (HPCL), and Bharat Petroleum Corporation Limited (BPCL) for selling the High-Speed Diesel to various private industries of three States viz. Gujarat, Maharastra, and Madhya Pradesh at concessional rates of sales tax as per applicable provisions of the State and Central Sales Tax Acts, without complying with the mandatory requisite permission from the Ministry of Petroleum and Natural Gas. 

R.C. Kodekar, the counsel for the C.B.I. submitted that the impugned order passed by the Special Judge was incorrect, illegal, and not as per the provisions of law. 

Also submitted was that at the stage of framing of charge, the court was not required to appreciate the evidence to conclude, whether the materials produced were sufficient or not, for convicting the accused. 

The evidence concerning the policy of the Ministry of Petroleum and Natural Gas requirement of technical evaluation and there was unanimous opinion in respect of the criminal involvement of the officials of the oil companies of marketing division, private firm owners, and those mediators who had purchased the Dos/allocation letters of HSD from the firm owners and further lifting HSD and diverted the same in the market. 

The Bench observed that the Special Judge had not found any ground for invocation of the charge under section 420 of the Indian Penal Code,1860 to satisfy that there should be a wrongful intention to cause some wrongful loss, and that, wrongful intention should be from the very inception. 

Also observed that under section 227 of the Criminal Procedure Code,1973 the judge was satisfied that the evidence produced before him while giving rise to some suspicion but not grave suspicion against the accused, he will be fully within his right to discharge the accused. 

A single-member bench Sandeep Bhatt held that the the accused are rightly discharged by the Special Judge (CBI) as there are no sufficient grounds for proceedings against them and the Special Criminal Applications fail merits and are dismissed. 

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