- 1 - NC: 2025:KHC-D:789 WP No. 103743 of 2024 C/W WP No. 103779 of 2024 WP No. 103797 of 2024 IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 17TH DAY OF JANUARY, 2025 BEFORE THE HON'BLE MR. JUSTICE HEMANT CHANDANGOUDAR WRIT PETITION NO. 103743 OF 2024 (GM-RES) C/W WRIT PETITION NO. 103779 OF 2024 (GM-RES) WRIT PETITION NO. 103797 OF 2024 (GM-RES) IN WP NO.103743 OF 2024: BETWEEN: 1. SHRI. T. RAVI KUMAR S/O. SHRI. TIMMAPPA AGE. 63 YEARS, OCC. SERVICE, R/A. SHRI. RAKSHA A-94-D, 12A, 19TH CROSS, 2ND MAIN, ESHWAR NAGAR, MANIPAL UDUPI TALUK AND DISTRICT-576104. 2. SHRI. GIRISH C S/O. SHRI. CHALUVAIAH AGE. 36 YEARS, OCC. SERVICE, R/AT. NO.KHB 55/B, GJ COLONY, BHADRAVATI SHIVAMOGA (DT), KARNATAKA-577301. …PETITIONERS (BY SRI. R. NAGENDRA NAIK, SRI. MANJUNATH CHOUDHARY AND SMT.DEEPASHREE D., ADVOCATES) AND: STATE BY PI CBI/ACB BANGALORE REP. BY SPL. PUBLIC PROSECUTOR, HIGH COURT OF KARNATAKA, AT DHARWAD, DHARWAD. …RESPONDENT (BY SRI. NEELENDRA D. GUNDE, STATE PUBLIC PROSECUTOR) THIS WRIT PETITION IS FILED UNDER ACRTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA R/W SECTION 482 OF Cr.P.C. PRAYING TO, CALL FOR RECORDS IN SPL. CC. NO. 01/2019 ON THE FILE OF III ADDITIONAL DISTRICT AND SESSIONS JUDGE DHARWAD AND ISSUE A WRIT IN THE NATURE OF CERTIORARI TO QUASH THE ORDER DATED. 19-01-2024 PASSED BY THE HON’BLE Digitally signed by B K MAHENDRAKUMAR Location: HIGH COURT OF KARNATAKA DHARWAD BENCH Date: 2025.02.28 12:30:02 +0530 - 2 - NC: 2025:KHC-D:789 WP No. 103743 of 2024 C/W WP No. 103779 of 2024 WP No. 103797 of 2024 III ADDITIONAL DISTRICT AND SESSIONS JUDGE DHARWAD IN SPL. CBI CC. NO.01/2019 DISMISSING THE APPLICATION FILED BY THE PETITIONERS UNDER SECTION 227 OF CRPC IN SOFAR AS PETITIONER CONCERNED AT ANNEXURE-A AND ETC. IN WP NO.103779 OF 2024: BETWEEN: 1. SHRI. PRABHU BHANDARI S/O. LATE SHRI. RAMANNA AGED ABOUT49 YEARS, OCC. SERVICE, R/A. NO.15-15-461, BANK COLONY, NEAR NIRATE COMPLEX, KUMBHARWADA, BIDAR (DT), KARNATAKA-581354, IT IS PRESENT WORKING PLACE. 2. SHRI. PRAKASHAYYA S/O. SHRI. NILAKANTHAYYA AGE. 60 YEARS, OCC: SERVICE, R/A. SRISILA NILAYA, KUSTAGI ROAD, BT PATIL NAGAR, KOPPAL, KARNATAKA-583231, IT IS PRESENT WORKING PLACE. …PETITIONERS (BY SRI. R. NAGENDRA NAIK, SRI. MANJUNATH CHOUDHARY AND SMT.DEEPASHREE D., ADVOCATES) AND: STATE BY CBI/ACB BANGALORE REP. BY SPL. PUBLIC PROSECUTOR, HIGH COURT OF KARNATAKA AT DHARWAD, DHARWAD-580011. …RESPONDENT (BY SRI. NEELENDRA D. GUNDE, STATE PUBLIC PROSECUTOR) THIS WRIT PETITION IS FILED UNDER ACRTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA R/W SECTION 482 OF Cr.P.C. PRAYING TO, CALL FOR RECORDS IN SPL.CC.NO.01/2019 ON THE FILE OF III ADDITIONAL DISTRICT AND SESSIONS JUDGE DHARWAD, AND ISSUE A WRIT IN THE NATURE OF CERTIORARI TO QUASH THE ORDER DATED 19.01.2024 PASSED BY THE HON’BLE III ADDITIONAL DISTRICT AND SESSIONS JUDGE DHARWAD IN SPL.CC.NO.01/2019 REJECTING THE APPLICATION FILED BY THE PETITIONERS UNDER SECTION 227 OF CRPC - 3 - NC: 2025:KHC-D:789 WP No. 103743 of 2024 C/W WP No. 103779 of 2024 WP No. 103797 of 2024 INSOFAR AS PETITIONERS CONCERNED, AT ANNEXURE-A AND ETC. IN WP NO.103797 OF 2024: BETWEEN: 1. SHRI. S. PRASANNA KUMAR S/O. LATE SUKUMARAN NAIR, AGED ABOUT 64 YEARS, OCC. RETIRED EMPLOYEE, R/A. THADEESSERIL HOUSE, KOZSHIMALA P.O., VALLAMKULAM VIA THIRUVALLA, KERALA-689101. 2. SHRI. VISHWANATH SALIMATH S/O. MALLIKARJUN C., AGED ABOUT 47 YEARS, OCC: R/A.NO.32-B, SRI DHAVALESHWAR BEHIND CORPORATION PARK, SAI NAGAR, HUBLI-580031. 3. SHRI. GOVINDA RAJU S/O. M DHANPAL AGED ABOUT 44 YEARS, OCC: CONTRACTOR, PROPRIETOR, M/S. G.V.FOUNDATION, R/A. RP 45/3, NEHRU STREET, NAGADEVAN VILLAGE, KATTARI POST, NATRAMPALLI TALUK, VELLORE (DT)-635852, TAMIL NADU. 4. SHRI. RAMA KRISHNA S/O. SUBBAIAH PANDIAN AGED ABOUT 48 YEARS, OCC: CONTRACTOR, PROPRIETOR OF M/S GOPIKA ERECTORS, R/O.H.NO.5/60, PILLAIYAR KOVIL STREET, THALAIVANKOTTAI, TIRUNELVELI (DT), TAMILNADU-627773. 5. SHRI. AT UDAY KUMAR S/O. SHRI R. TANGAPPAN NAIR, AGED ABOUT 55 YEARS, OCC. CONTRACTOR, PROPRIETOR OF M/S MAHALAKSHMI CONSTRUCTIONS, R/O.DNO.1-116-(1) ASWIN BATA HILL, BATA, MANGALORE-575030. - 4 - NC: 2025:KHC-D:789 WP No. 103743 of 2024 C/W WP No. 103779 of 2024 WP No. 103797 of 2024 6. SHRI. SASIKANTH RAGHUNATH HALDE S/O. RAGHUNATH TUKARAM HALDE, AGED ABOUT 58 YEARS, OCC: CONTRACTOR, PROPRIETOR OF M/S THYSUN ENGG. R/O.NO.103, SACHIN CO-OPERATIVE HOUSING SOCIETY, 113 MODEL TOWN, J P ROAD, ANDHERI WEST, MUMBAI-53. 7. SHRI. C. VELU S/O. SHRI. KT CHINNATAMBI AGED ABOUT 41 YEARS, OCC. CONTRACTOR, PROPRIETOR, M/S LAKSHMI DEVI, R/O. KOYANKOLLAI VILLAGE, MALLAGUNDA VILLAGE, NATRAMPALLI TALUK, VELLORE (DT), TAMIL NADU-635852. …PETITIONERS (BY SRI. R. NAGENDRA NAIK, SRI. MANJUNATH CHOUDHARY AND SMT.DEEPASHREE D., ADVOCATES) AND: STATE BY CBI/ACB BANGALORE REP. BY SPL. PUBLIC PROSECUTOR, HIGH COURT OF KARNATAKA, AT DHARWAD, DHARWAD-580011. …RESPONDENT (BY SRI. NEELENDRA D. GUNDE, STATE PUBLIC PROSECUTOR) THIS WRIT PETITION IS FILED UNDER ACRTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA R/W SECTION 482 OF Cr.P.C. PRAYING TO, CALL FOR RECORDS IN SPL. CBI, CC. NO.01/2019 VIDE ANNEXURE-A ON THE FILE OF III ADDITIONAL DISTRICT AND SESSIONS JUDGE DHARWAD, AND ISSUE A WRIT IN THE NATURE OF CERTIORARI TO QUASH THE ORDER DATED. 19.01.2024 PASSED BY THE HON’BLE III ADDITIONAL DISTRICT AND SESSIONS JUDGE DHARWAD IN SPL. CBI CC. NO.01/2019 VIDE ANNEXURE-A REJECTING THE APPLICATION FILED BY THE PETITIONERS UNDER SECTION 227 OF CRPC INSOFAR AS PETITIONERS CONCERNED AND ETC. - 5 - NC: 2025:KHC-D:789 WP No. 103743 of 2024 C/W WP No. 103779 of 2024 WP No. 103797 of 2024 THESE PETITIONS, COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: THE HON'BLE MR. JUSTICE HEMANT CHANDANGOUDAR ORAL ORDER 1. The challenge in these petitions is to the proceedings before the learned III Additional District and Sessions Judge (Special Judge for CBI/ACB/KLA Cases) Dharwad in Special CBI CC No.1/2019. These petitions have been taken up together for disposal. 2. In WP No.103743/2024, the petitioners are Junior Engineers of Power Grid Corporation at Kudgi-Vijayapur. In WP No.103779/2024, petitioner No.1 is the Deputy Manager and petitioner No.2 is the Junior Engineer (Chief Administrative Officer). In WP No.103797/2024, petitioner Nos. 1 and 2 are employees of the company to whom the contract was awarded for executing the laying of transmission lines, and petitioners Nos. 3 to 8 are subcontractors who allegedly carried out work on behalf of the company. 3. The Central Bureau of Investigation (CBI) has registered an FIR for offences punishable under Sections 120B read with Section 420 of the Indian Penal Code, 1860 (IPC), and Section 13(2) read with Section 13(1)(d) of the Prevention of Corruption Act, 1988. - 6 - NC: 2025:KHC-D:789 WP No. 103743 of 2024 C/W WP No. 103779 of 2024 WP No. 103797 of 2024 4. A summary of the allegations in the FIR is as follows: “The service portion of the contract was initially awarded for a sum of Rs.69,91,12,160/- and subsequently reduced to Rs.31,62,67,917/-, a decrease of about 45%. Further, the initial supply contract was agreed for Rs.111,37,69,959/- and subsequently reduced to Rs.100,11,67,421/-, a decrease of about 10%, which prima facie indicates that the Notice Inviting Tender (NIT) was inflated to avoid competition. Further information reveals that the contract work for the above project was awarded to M/s. Isolux De Mexico S.A. DE CV, Mexico (ISOLUX), the Lead Partner of the Joint Venture (JV), and M/s. Karamatara Engineering Pvt. Ltd. (the Partner of the JV) by Power Grid Corporation of India Ltd. (PGCIL). However, the work was being executed by Isolux Corsan India Engineering & Construction Pvt. Ltd. Information also discloses that this led to a compromise in the quality of work. Additionally, despite the contract being awarded to Isolux De Mexico, payments were made to various parties by both M/s. Isolux Corsan India Engineering & Construction Pvt. Ltd. and M/s. Isolux De Mexico. Accused No.1, Shri G. Srinivasa Rao, the Manager of PGCIL in Bijapur, and subcontractors, even though not approved by the competent authority, released payments to the contractors before obtaining test results for the concrete cubes. It has also been revealed that the quality test reports were manipulated, and the quality of the concrete was not as per required standards. The quality of work was - 7 - NC: 2025:KHC-D:789 WP No. 103743 of 2024 C/W WP No. 103779 of 2024 WP No. 103797 of 2024 compromised by the PGCIL officials, undermining the safety of the project, which led to a huge financial loss for PGCIL. 5. After conducting an investigation, the CBI submitted a charge sheet for the aforesaid offences. The charges against the accused are as follows: I. The NIT was inflated to avoid competition. II. Unnecessary extensions were granted for tower heights, resulting in undue pecuniary advantages to M/s. Isolux De Mexico. III. M/s. Isolux De Mexico had sublet the entire service portion of the contract to M/s. Isolux Corsan, which in turn sublet the work to various other subcontractors in violation of the contract, leading to poor work quality and a huge loss to PGCIL. IV. Quality test reports were manipulated, and the concrete quality did not meet specifications. PGCIL officials, in conspiracy with the contractors and others, allowed substandard work, undermining the safety of the project and causing a financial loss to Power Grid. V. The check formats for foundation classification, soil classification, and foundation casting were manipulated, and payments were made at higher costs for dry fissured rock (DFR) instead of normal dry soil, thereby causing pecuniary gain to the contractors. - 8 - NC: 2025:KHC-D:789 WP No. 103743 of 2024 C/W WP No. 103779 of 2024 WP No. 103797 of 2024 6. The learned Special Court, after accepting the charge sheet submitted by the CBI and pursuing the same, took cognizance of the aforesaid offences. The petitioners entered appearance and filed applications to discharge them under Section 227 of the Criminal Procedure Code (Cr.P.C.). After hearing the parties, the Special Court dismissed the applications, prompting the petitioners to approach this Court. 7. Sri R. Nagendra Naik, learned counsel representing the petitioners, argued that the charge sheet alleges that the quality of the concrete used for the erection of the towers was poor because the required quality of cement was not used, and the quality deteriorated because the main contractor, who was awarded the contract, subcontracted the work to accused No.8, who further subcontracted it to accused No.9. Therefore, the poor construction quality of the towers resulted in monetary loss to Power Grid Corporation. He further submitted that the petitioners were not responsible for inspecting the quality of the work. He also stated that the Central Electricity Authority conducted an inspection of the transmission line in question and approved the energization of 400 KV DC after the inspection. Moreover, the transmission lines were laid back in 2007, and as of today, the service provider continues to provide service through the subject transmission line, as evidenced by information issued by Power Grid Corporation dated 5.10.2023 under Annexures M & N. He further submitted that accused Nos. 9 to 13 had satisfactorily carried out similar work for government entities, and therefore the allegation that they were unqualified to carry out the work is without substance. - 9 - NC: 2025:KHC-D:789 WP No. 103743 of 2024 C/W WP No. 103779 of 2024 WP No. 103797 of 2024 8. Sri Nagendra Naik further submitted that even if the allegations made against the petitioners are accepted, at most it may amount to dereliction of duty, but it could not constitute an offence of cheating. 9. In response, learned counsel for the respondent-CBI argued that the charge sheet material discloses that the cement used for constructing the towers was of substandard quality, as evidenced by a report from SDM Institute of Technology. He further submitted that due to the subletting of the contract, the quality of work was not as per the specifications, resulting in a monetary loss to the National Power Grid Corporation of India Limited. Subletting is prohibited under the terms of the contract awarded by the company, i.e., accused No.8. 10. He further submitted that the completion certificate issued in favour of accused No.8 was issued without conducting the necessary inspection. Therefore, the certificate does not absolve the criminal liability of the petitioners. He further submitted that accused Nos. 1 to 4, officers of the National Power Grid Corporation of India Limited, were under an obligation to supervise the work, and their failure to effectively supervise the work resulted in causing loss to the National Power Grid Corporation of India Limited. 11. After considering the arguments of the learned counsel for the parties, the following points are noted: - 10 - NC: 2025:KHC-D:789 WP No. 103743 of 2024 C/W WP No. 103779 of 2024 WP No. 103797 of 2024 12. The National Power Grid Corporation of India Limited, Kudgi, issued a work order to accused Nos. 7 and 8 for laying the 400 KV transmission line from Narendra-Dharwad to Kudgi. As per the terms of the contract, accused Nos. 7 and 8 were prohibited from subletting the contract. The transmission line was to be laid by accused Nos. 7 and 8 over a distance of 185 KM, and they were prohibited from entrusting the work to subcontractors. 13. The respondent-CBI alleges that accused Nos. 7 and 8, despite the restriction on subletting the contract, sublet the work, as evidenced by the bills raised by the subcontractors for work done on behalf of accused Nos. 7 and 8. Even assuming that accused Nos. 7 and 8 violated the terms of the contract and that accused Nos. 1 to 3, officers of the National Power Grid Corporation of India Limited, did not take steps to prevent the subletting, this does not satisfy the essential elements required to constitute an offence under Section 420 of the IPC. To constitute an offence under Section 420 of the IPC, there must be specific overt acts demonstrating that the accused, in collusion with each other, induced the National Power Grid Corporation of India Limited to issue the work order with the intention to deceive. In the present case, there is no material or allegation that these accused induced the National Power Grid Corporation of India Limited to enter into a contract with accused No. 8, which has been dropped from the charge sheet. At most, even if the allegations are accepted, it would amount to dereliction of duty by the officers of the National Power Grid Corporation of India Limited and a breach of contract, which is a civil matter. - 11 - NC: 2025:KHC-D:789 WP No. 103743 of 2024 C/W WP No. 103779 of 2024 WP No. 103797 of 2024 14. The energization of the transmission line occurred on 12.11.2015, and as of today, there is no allegation, as evidenced by the commercial operational certificate issued by the National Power Grid Corporation of India on 11.12.2015 (Annexure-J), that there is any defect in the transmission of electricity. 15. The respondent-CBI has not placed any evidence on record to show that the National Power Grid Corporation of India Limited suffered any monetary loss due to the poor quality of work, and this is not supported by any audit report. The essential elements required to satisfy the offence punishable under Section 13(1)(d) of the Prevention of Corruption Act are also conspicuously absent. Even accepting the allegations made against accused Nos. 1 to 3, they do not satisfy the essential elements to constitute an offence under Section 13(1)(d) of the Prevention of Corruption Act. Therefore, the continuation of criminal proceedings would amount to an abuse of the process of law. 16. The learned Special Judge, ignoring material aspects, dismissed the application for discharge, and the same is not legally sustainable. Therefore, the continuation of the criminal proceedings would be an abuse of the process of law. 17. Accordingly, I Pass the following: ORDER i) The petitions are allowed. - 12 - NC: 2025:KHC-D:789 WP No. 103743 of 2024 C/W WP No. 103779 of 2024 WP No. 103797 of 2024 ii) The impugned proceedings in Spl.CBI.CC No.01/2019 pending on the file of the III Additional District and Sessions Judge at Dharwad, insofar as it relates to the petitioner – accused Nos.1 to 6 and 9 to 13 stands quashed. Sd/- (HEMANT CHANDANGOUDAR) JUDGE JTR/AC Ct:vh List No.: 1 Sl No.: 45