In a landmark judgment, the Supreme Court today upheld the decision to quash a money laundering case against former IAS officer Bibhu Prasad Acharya, emphasizing the necessity of obtaining governmental sanction before prosecuting public servants. The ruling, delivered by the Division Bench comprising Justices Abhay S Oka and Augustine George Masih, reiterates the protective measures afforded to officials under Section 197 of the Code of Criminal Procedure (CrPC).
This section mandates that no court shall take cognizance of criminal charges against a public servant unless the relevant government has sanctioned the prosecution. This applies if the act in question was committed during the performance of official duties.
The case against Acharya originated from his tenure as the Vice Chairman of the Andhra Pradesh Industrial Infrastructure Corporation (APIIC), where he was implicated in a larger investigation involving disproportionate assets linked to former Andhra Pradesh Chief Minister YS Jagan Mohan Reddy. The Enforcement Directorate (ED) had accused Acharya of misusing his official position to grant undue favours to several firms, including Aurobindo Pharma and the Hetero Group, allegedly causing a substantial financial loss to the APIIC.
However, the Telangana High Court in 2019 ruled that the ED’s failure to secure the required governmental sanction rendered the case untenable, leading to its dismissal. This verdict was challenged by the ED in the Supreme Court, arguing the necessity of continuing the prosecution without the sanction.
Dismissing the ED’s appeal, the Supreme Court clarified that the requirement for sanction under Section 197 is applicable even under the Prevention of Money Laundering Act (PMLA), thus protecting public servants from unjust prosecution. “We have held that the provision of Section 197 CrPC providing sanction will apply to cases under PMLA,” the bench noted in their judgment.
