# [1968] 3 S.C.R. 789

- **Citation:** [1968] 3 S.C.R. 789
- **Court:** Supreme Court of India
- **Decided:** 1968-04-16
- **Bench:** J. C. Shah, V. Ramaswami, V. Bhargava, G. K. Mitter, C. A: Vaidialingam
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/1968-3-s-c-r-789-4345
- **Pages:** 21

## Headnote

Commission of Inquiries ict (60 of 1952), s. 3--Setting up of Com-·
nJission for collection of facts for future action-:-Partly due ta ·political'
rivlllry but dominant purpose bona fide--Va!idity~ome items in Notification appoinang Commission_ ~ubject to appeal in civil court-Setting. up·
of Comn1ission, if-constitutes contemp~ of court.
The appellants were Chief Ministers and Ministers of the respondentState. Jn Parliament, the State Legislature and from public platforms,
it was alleged that during their tenure of office the appellants were guilty
of acts of serious misconduct. corrti:ption, abuse of power. misfeasanceand malfeasance. Therefore. the State Government, in exerci!e of its
powers under s. 3 of the Commission of Inquiries Act, 1952, issued a
notification appointing a Commission of Inquiry to inquire into and report
on the matters,· 'so that facts may be found which alone will facilitate
rectification and prevention of recurrence of such lapses and securing the
ends of justice and establishing a moral public order in futur~ .. The appellants filed writ petitions for setting aside the Notification, but the High
Court dismissed them.
·
In appeal to this Court, it was contended that : ( 1) An inquiry for
mere collection of facts unrelated to any future course of Government
action or legislative policy does not fall within the purview of s. 3 df the
Act and it is not a valid exercise of statutory power to appoint such a
Commission; (2) the Commission was set up for a purpose alien to the
statute, in that it was set up by the State Government not in the publicrinterest but for the collateral purpose of getting rid of political rivals by
character assassination; and
(3) the
appointment
of the Commission·
constituted contempt of court in that some of the items referred to in tbeimpugned notification were the subject matter of' a first appeal pending
in the High O>urt.
HELD : ( 1) The preamble to the notification shows that the object of
setting up the Commission in the present case was to take approprlate1egislative or administrative measures 'for maintaining. high standards ofpublic conduct and purity of political administration in the State in future.
Therefore, the notification falls within the ambit of s. 3
of the Act.
[801 A-C .. 803 D-EI
Shri Ram Krishna Da/m;a v. Shri Justice S. R. Tendolkar
(1959]
S.C.R. 279, explained.
·
.
'
(2) It may be that the appointment of the Commission of Inquiry in
the present case was partly on account of political rivalry between the·
party in power and those against _whom the inquiry was ordered but the·
dominant purpose of setting up the Commission was to promote ~easures
for maintaining p_urity and integrity of the administration in the po!iticar
hfe of the State tn future and not the character assassination of rivals.
Therefore, the impugned notification was issued bona fide and is le"ally
valid. (805 A-B; 807 R-E] ·
0
The King v. Minister of Health, [1929] 1 K.B. 619, referred to.
*The order dismissing the appeals was pronounced on April 16, 1968 and the
Judgment was delivered On April 30, 1968.
790
SUPRE11E COURT REPORTS
[1968] 3 S.C.R.
Rex v. Brighton Corporation ex-parte Shoosmith,
96 -L.T. 762, Earl
Ei:za•illiani's TVentworth Estate Co. Ltd. v. Minister of To1vn and Country
. Planning, [1951] 2 K.B. 284; applied.
(3) To constitute contempt of court
there must
be involved some
.. act done or writing pllblished calculated to bring a court or a judge of
the court into contempt or to. lower his authority' or something 'calculated to obstruct or interfere
with the due course of justice or the la\vful
-process. of the courts.' [808 HJ
In the ·prfient-c:ise,- the suits 'Were filed 'for damages for defamation -in
relation to allegations of corruption.
There was no factual inquiry into
the allegations and the suits were decided on the basis of burden of proof:
A
B
Therefore, it could not be.Said-that the_inquiry ordered was in relation to
the very matters which were the subject matte

## Text

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789
. v..
.
STATE OF ORISSA & ORS.
April 16/30, 1968*
[J. C. SHAH, V. RAMASWAMI, V. BHARGAVA, G. K. MITTER
AND C. A: VAIDIALINGAM, JJ.]
Commission of Inquiries ict (60 of 1952), s. 3--Setting up of Com-·
nJission for collection of facts for future action-:-Partly due ta ·political'
rivlllry but dominant purpose bona fide--Va!idity~ome items in Notification appoinang Commission_ ~ubject to appeal in civil court-Setting. up·
of Comn1ission, if-constitutes contemp~ of court.
The appellants were Chief Ministers and Ministers of the respondentState. Jn Parliament, the State Legislature and from public platforms,
it was alleged that during their tenure of office the appellants were guilty
of acts of serious misconduct. corrti:ption, abuse of power. misfeasanceand malfeasance. Therefore. the State Government, in exerci!e of its
powers under s. 3 of the Commission of Inquiries Act, 1952, issued a
notification appointing a Commission of Inquiry to inquire into and report
on the matters,· 'so that facts may be found which alone will facilitate
rectification and prevention of recurrence of such lapses and securing the
ends of justice and establishing a moral public order in futur~ .. The appellants filed writ petitions for setting aside the Notification, but the High
Court dismissed them.
·
In appeal to this Court, it was contended that : ( 1) An inquiry for
mere collection of facts unrelated to any future course of Government
action or legislative policy does not fall within the purview of s. 3 df the
Act and it is not a valid exercise of statutory power to appoint such a
Commission; (2) the Commission was set up for a purpose alien to the
statute, in that it was set up by the State Government not in the publicrinterest but for the collateral purpose of getting rid of political rivals by
character assassination; and
(3) the
appointment
of the Commission·
constituted contempt of court in that some of the items referred to in tbeimpugned notification were the subject matter of' a first appeal pending
in the High O>urt.
HELD : ( 1) The preamble to the notification shows that the object of
setting up the Commission in the present case was to take approprlate1egislative or administrative measures 'for maintaining. high standards ofpublic conduct and purity of political administration in the State in future.
Therefore, the notification falls within the ambit of s. 3
of the Act.
[801 A-C .. 803 D-EI
Shri Ram Krishna Da/m;a v. Shri Justice S. R. Tendolkar
(1959]
S.C.R. 279, explained.
·
.
'
(2) It may be that the appointment of the Commission of Inquiry in
the present case was partly on account of political rivalry between the·
party in power and those against _whom the inquiry was ordered but the·
dominant purpose of setting up the Commission was to promote ~easures
for maintaining p_urity and integrity of the administration in the po!iticar
hfe of the State tn future and not the character assassination of rivals.
Therefore, the impugned notification was issued bona fide and is le"ally
valid. (805 A-B; 807 R-E] ·
0
The King v. Minister of Health, [1929] 1 K.B. 619, referred to.
*The order dismissing the appeals was pronounced on April 16, 1968 and the
Judgment was delivered On April 30, 1968.
790
SUPRE11E COURT REPORTS
[1968] 3 S.C.R.
Rex v. Brighton Corporation ex-parte Shoosmith,
96 -L.T. 762, Earl
Ei:za•illiani's TVentworth Estate Co. Ltd. v. Minister of To1vn and Country
. Planning, [1951] 2 K.B. 284; applied.
(3) To constitute contempt of court
there must
be involved some
.. act done or writing pllblished calculated to bring a court or a judge of
the court into contempt or to. lower his authority' or something 'calculated to obstruct or interfere
with the due course of justice or the la\vful
-process. of the courts.' [808 HJ
In the ·prfient-c:ise,- the suits 'Were filed 'for damages for defamation -in
relation to allegations of corruption.
There was no factual inquiry into
the allegations and the suits were decided on the basis of burden of proof:
A
B
Therefore, it could not be.Said-that the_inquiry ordered was in relation to
the very matters which were the subject matter of the first appeal filed in
the High Court again.st the' decision· in the suits. [808 ~El . ·
C
Further, the scope of the trial by courts of law and the scope o'f an
inquiry by the Com~ission are altogether different, and _therefore, the in.
quiry by the Commission would not amount
to- an usurpation of the
function of courts of law. [808 E]
In any case, it cannot be said that the Commission wOUtd be-liable for
-contempt of court, i'f it proceeded to inquire into matters ,referred to it by_
the Government notification, because, in appointing the _Commission the
'State Government \Vas exerci'.Sing a statutory power and in making
the
inquiry the Commission \Vould be performing a statutory- duty. The res.
pondents in this case have done nothing to obstruct or interfere v.rith the
.la\\ful powe·rs of ihe court by acting bona fide and by discharging statu·
tory functions under tho Act. [808 B-G]
Reg. v. Gra.v, [1900] 2 Q.B. 36 and Arthur Reginald Perera v. The
King, [1951] A.C. 482, 488, applied.
CIVIL APPELLATE JUR1smcnoN: Civil Appeal Nos. 1148-·
1150 of 1968.
Appeals from the judgment and order dated February . 22,
1967 of the~Orissa High Court in 0.J.C. Nos. 396, 40S and 418
<Jf 1967.
A. K. Sen, Rajendra Mohanty, K. R. Chaudhury and K;
Rajendra Chou_dhury, for the appellants.
C. K. Daphtary, Attorney-General, Ashok Das, AdvocateGeneral for the State of Orissa, Santosh Chatterjee, B, B. Ratho
· and R. N. Sachthey, for respondents Nos. 1, 2 and 4.
·
Lal Narain Singh, Advocate-General for the State of Bihar
and R. K. Garg, for interv;:ner No. I.
B. Sen, M. K. Banerjee, s. K. Dholakia and J. B. Dadachanji,
for intervener No. 2.
The Judgment of the Court was delivered by
Ramaswami, J.
These appeals were heard on April 15 and
April 16, 1968 and at the close of the hearing we ordered that
the appeals should be dismissed with costs and indicated that our
reasons .would be pronounced later. Accordingly our present judgD.
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.JAGANNATH RAO v. STATE (Ramaswami, J.)
791
ment gives our reasons for the order which has already
been
passed.
These appeals are brought against the commo.n judgment of
the Orissa High Cqurt dated February 22 •. 19.68 m O.J.<;._ Nos.
396, 408 and 418 ~ 1967. By these applications the pelltmners
therein prayed for an appropriate .direction or. order. under. Art.
226 of the Constitution for quashing and settmg aside notification No. 813-EC dated October 26, 1967, issued by the Government of Orissa in exercise:· of the powers conferred on it by s. 3
of the Commissions of Enquiry Act (LX of 1952) and for othe1
reliefs. The Schedule to the Notification gives the names of 15
persons against whom inquiry is to be made. The petitioners in
the three O.J.C.s have respectivelv been referred to in Items 6,
2 and 12 of the Schedule. ·In O.J.C. 418, Shri Harekrushna
Mahtab, Shri Nabakrushna Choudhury, Shri
Pabitra Mohan
Pradhan, Shri Santanu Kumar Das and Shri Surendranath Patnaik
were originally impleaded as opposite parties Nos. 5 to 9. Shri
Biju Patnaik filed an application in this case to be impleaded as
an opposite party. As the other parties had no objection he was
also imp leaded as opposite party No. 10. Rules were issued and
except opposite parties Nos. 3 and 6 the other opposite parties
showed cause.
By its judgment dated February 22, 1968 the
High Court dismissed the applications, holding that the notification of the State Government dated October 26, 1967 appointing
the Commission of Inquiry was legal • and valid.
Against this
judgment the petitioners in all the three O.J .C.s have preferred the
present appeals by certificate of the Orissa High Court.
Shri Harekrushna Mahtab was the Chief Minister of Orissa
from 1947 to 1949. Shri Nabakmshna Choudhury wits the Chief
Minister from 1950 to 1956. In the 1957 General Election to
the Orissa Legislative Assembly (hereinafter referred to as the
'Assembly'), out of 140 seats the Congress Party got only 56
seats.
Sri Harekrushna Mahtab formed the Ministry with the
s~pport of other members but he had to resign in 1959 due to
withdrawal of support by some of the groups in the Assembly.
In May, 1959, he formed a coalition ministry with the help of
Ganatantra _Parishad of which Sri R. N. Singh Deo was the leader.
Sri Singh Deo became the Finance Minister and the Deputy
Leader in the Coalition Government. During the coalition Ministry there developed acute difference of opinion in the Orissa Congres~ . Legisl~t!ve party over the condu~t and programme of the
~oahtion Mm1stry.
The Congress Legislative party was divided
mto two groups, one under the leadership of Sri Harekmshna
M!111tab and the other under the leadership of Sri Biju Patnaik.
Sn Harekrushna Mahtab had to resign in February, 1961 as he
lost the support ·of the majority of the Congress Legislative party.
8 Sup. CJ/68-11
792
SUPREME COURT RBPOllTS
(1968) 3 S.C.R.
The Assembly was dissolved and there was President's rule for
sometime._ During the President's rule, a mid-term election was
held in May, 1961. The Congress Party succeeded in capturing
80 seats out of 140 under the leadership of Sri Biju Patnaik. At
that time the Ganatantra Parishad had joined the Swatantra Party'
of India. The dissident group of members under the leadership
of Sri Harekrushna Mahtab defected from the Congress Party and
formed a separate political party under the name of "Jana Con~
gress''. The case of the appellants is that from 1961 till the end
o( 1966 this group bad its secret alliance with the Swatantra Party
and went on creating obstruction from within to the smooth
administration by the Congress Party which had a superior numerical strength. Sri Biju Patnaik was the Chief Minister, Shri Biren
Mitra was the Deputy Chief Minister.
There was a firm called
"Orissa Agents" in the name of Mrs. Mitra which made supplies to
some of the departments of the Orissa Government. A campaign
was carried on by Sri Mahtab and Sri Pabitra Mohan Pradhan
attacking the honesty of Sri Biren Mitra. There was a debate in
the Assembly in which a direct attack was made on the honesty
and integrity of Sri Mitra and there was a demand for appointment
of a Commission of Inquiry. The Government of Orissa did not
agree to the appointment of a Commission of Inquiry but Sri
Biju Patnaik referred the matter to Sri Singh Deo, leader of the
Opposition and Chairman of the Public Accounts Committee. Sri
Singh Deo initially accepted the responsibility, but later on
expressed his unwillingness. The Orissa Government had a special
audit of the allegations and sent the report to the Public Accounts
Committee in the year 1964. While the matter was pending with
the Public Accounts Committee, Sri Biju Patnaik resigned the
Chief Ministership of Orissa on October l, 1963. He, however,
continued to be the chairman .of the State Planning Board till
January 29, 1965 when Sri Biren Mitra was the Chief Minister.
Sri Mitra dropped out Sri Pabitra Mohan Pradhan from the cabinet.
During the tenure of the office of Sri Mitra as the Chief
Minister of ()rjssa, some members of the Opposition in the Assembly, which included all the members of the Swatantra Party, filed
a. memorandum before the President of India alleging misappropriation, misconduct and fraud against Sri Patnaik, Sri Mitra. and
~ain other Ministers and requested the President of India to
appoint a Commission of Inquiry to inqUire into these allegations.
The President referred the Memorandum to his Council of Ministers. It is said the Central Government did not favour the appointment of a Commission of Inquiry but decided to have the allegations enquired into by the Central Bureau of Intelligence (hereinafter referred to as the C.B.I.). After receiving the preliminary
report of the C.B.I. the Central Government rejected the demand
for appointment of a Commission of Inquiry. A statement was
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JAGANNATH RAO v. STATE (Ramaswami, J.)
793
made in Parliament that certain improprieties were committed but
the examination did not reveal any misconduct, misappropriation
or fraud or abuse of power for personal gain. As a result of
the statement in the Parliament Sri Biren Mitra who was then the
Chief Minister submitted his resignation and Sri Sadasiv Tripathy
was elected as the leader of the Congress Legislative Party and
carried on administration as the Chief Minister of Orissa till the
last General Election. Soon after the formation of the present
Ministry, the Governor of the State announced in his address to
the Legislature the decision to set u'p a Commission of Inquiry
to enquire into the charges of corruption and improprieties alleged
to have been committed by the Ministers who were in office
from 1961 to 1967.
The present. Commission was appointed
in pursuance of the policy laid down in the address of the Governor.
The main ground of attack on behalf of the appellants was that
the notification was illegal because the Government exercised the
statutory power ma/a fide and for collateral purpose and that the
object of appointing the Commission of Inquiry was to get rid of
Sri Biju Patnaik and Sri Biren Mitra and to drive thenf out of the
political life of Orissa. The High Court held that the allegation
of the appellants was not made out and upheld the legal validity
ui the notiiicaiion dated October 26, 1967 issued by the Orissa
Government.
Sub-s. (1) of s. 3 of the Commissions of Inquiry Act, 1952
(No. LX of 1952), hereinafter referred to as the 'Act', provides as
follows:
"3. Appointment of COmmission.--{l) The appropriate Government may, if it is of opinion that it is
necessary so to do, and shall, if a resolution in this behalf
is passed by the House of the People or, as the case may
be, the Legislative Assembly of the State, by notification
in die Official Gazette, appoint a Commission of Inquiry
for the purpose of making an inquiry into any definite
matter <Of public importance and performing such functions and within such time as may be specified in the
notification, and the Commission so appointed shall
make the inquiry and perform the functions accordingly :
•
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Se~tion 4 vests in the COmmission the powers of a civil court while
trying a suit under the Code of Civil Procedure and reads as
f~!!ow&;
"4. Powers of Commission.-The Commission·shall
have the powers of a civil court, while trying a suit under
the Code of Civil Procedure, 1908 (Act V of 1908}.
in respect of the following matters, namely :-
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794
SUPREME COURT .REPORTS .
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(1968] 3 s.c.R.
.
(a) summoning and enforcing.the-attendance of any .
person and _examining him 011 oath;
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(b) requiring the discovery and production of any
document;
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_ (c) receiving evidence on affidavits;
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(d) requisitioning any public record or_ copy thereof
Jrom any cou,rt _ or_ofli:e; ·
(e) issuing commissions for the examination of witnesses or documents;
·
(f) any other matter which may be prescribed." .
Section 5 empowers the appropriate Government, by a notification
. in the Official Gazette, to confer on the Commission additional
powers as provided ill all or any of the sub-ss. (2), (3), (4) and -
(5) of that section. S_ection 6 states :
,
"6. Statements made by persons
to the Commission.-No statement made by a person in the course of
giving evidence before the Commission shall subject him
. to, or be used against hini in, any civil or criminal proceeding except a prosecution for giving false evidence
by such statement :
Provided that the statement-
(a) is made in reply to a question which he is required by the Commission to answer, or
(b) is relevant to the subject matter of the inquiry."
By s. 8 the Commission is empowered to regulate its own procedure including the time and place of its sittings and may act notwithstanding the. temporary absence of any member or the existence of any vacancy among its members.
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The notification of the Orissa Government dated October 26,
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1967 is to the following ef!'ect: -
"HOME DEPARTMENT .
·NOTIFICATION
. '
The 26th October, 1967.
No. 813-· EC.-WHEREAS pursuant to the midterm general election of the State Legislative Assembly.
· in 1961, Councils of Ministers headed by Shri Biju
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JAGANNATH RAO v. ~TATF (Rama.swami, /.)
795
Patnaik, Shri Biren Mitra and Shri Sadasiva Tripathy
\VCJ:e fonned in the State during different times during
the period from the 23rd 1 une 1961 till the 8th March
1967 and Shri Biju Patnaik, after laying down his office·
as Chief Minister, declared himself to be the Chairman,
Planning Board and continued to function as Chainnan,
Planning Board during the period from the 4th October,
1963 to the 29th January 1965, during the Chief
Ministership of Shri Biren Mitra;
AND WHEREAS during the tenure of office of the
aforesaid persons as Chief Ministers there were various
allegations against the conduct of the aforesaid persons
and some of the Ministers and Deputy Ministers of the
State of Orissa, as specified in the Schedule hereto, by
politicians, the general public and others, and the allegations apart from being put forward from public platfonns
by private persons and otherwise, have been the subjectmatter of active agitation all through in the State Legislature and in the Parliament and some of such allegations
were of such a i:iature that an enquiry was conducted
thereon by the Central Bureau of Investigation and the
Ceptral Cabinet also held deliberations over the same ;
AND WHEREAS on an active and careful consideration of all such allegations by the Government of
Orissa, it appears to them :-·
TIIAT DURING
THE AFORESAID PERIOD,
i.e., FROM THE 23RD JUNE 1961 TO THE 8111
MARCH 1967, THE SAID PERSON ·As NAMED
IN THE SCHEDULE:
(1) committed various acts of misconduct, misappropriation, fraud, negligence,
favouritism, nepotism
illegalities, irregularities,
improprieties and abuse of
their power in the matters of administration of the
State:
(2) · abused their official positions for securing pecuniary and other benefits for themselves, members of their
families, their relations, their friends, . their partymen
(Congressmen) and others in· whom they were interested, .from out of ~e funds of the State exchequer and
otherwise to the detriment of the interests of the State· '
. (3) c:ommitted breach of trust and acts of impropnety with respect to the properties and assets of the
State yn~ a view to further the interests of their party
organiSll'tion, i.e., the Congress;
796
SUP.RElll:B COU&T IU!POU'S
£1968] 3 S.C.R.
(4) entered into contracts and other monetary transactions for the supply of machinery, tools, equipmenis
and execution of works, themselves, or permitted their
family members, relittions, friends, partymen and others
to enter into such contracts and transactions with the
Government of Orissa, with different Departments of
the Government ·of Orissa, with Corporations, Local
Bodies, Statutory Bodies and with other Bodies with
which Government of Orissa have or had interest, control or concern in utter disregard of the interests of the
State in breach of the trust imposed on them by virtue
of their Constitutional positions;
(5) resorted to misuse of ·power, interfered in the
processes of elections and administration of Local Bodies
not only to help their friends, favourites and partymen
but also at times for their own personal benefits;
(6) acquired directly properties of the State either
for themselves or for the benefit of the members of their
families or relations or others in whom they were interested;
(7) advanced money and Joans by way of favouritism out of the Statci exchequer in favour of themselves,
members of their families, their relations and other persons in whom they were interested;
(8) permitted wastage, misuse,
misutilisation and
misappropriation of the funds of the State in several ways
to the detriment of the interests of the State in utter
disregard of the canons of financial propriety and established rules and procedure from which a presumption
of personal gains for themselves or for persons as aforesaid directly or indirectly arises;
·
(9) caused wastage, misuse, misutilisation, misappropriation, illegal or irregular use of the funds of !he
State through contracts or other monetary transactions
entered into by the Government without following the
rules of Jaw or the established procedure;
(10) by way of favouritism
and nepotism caused
maladministration in matters of public services, namely,
in the matter of appointments, transfers, promotions and
dealing with corrupt officers;
(11) interfered with the administration of Jaw and
tried to pervert the course of justice by helping offenders
to escape law;
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JAGANNATH RAO v. STATE (Ramaswami, J.)
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(12) caused to the State Government huge financial
loss which has given rise to a great economic crisis,
serious retardation in the progress of trade, industry and
commerce, agricultural output, serious problems of unemployment and has also vitiated the moral and general
character of the people;
(13) acted in several cases against constitutional proprieties, public policies and proper social and political
conduct;
(14) amassed wealth themselves, through members
of their family, relations and other persons or permitted
the members of their family, relati9ns and other persons to amass wealth and their assets during the aforesaid period have increased disproportionate to the known
sources of their income, by abuse of their constitutional
positions.
Under such circumstances the people in general and
the Government have expressed a desire that the matters aforesaid regarding the aforesaid persons should be
enquired into through a Commission of Inquiry so that
facts may be found which alone will facilitate rectification and prevention of recurrence of such lapses and
securing the ends of justice and establishing a moral
public order in future.
Under such circumstances, the Government of the
State of Orissa are of the opinion that it is necessary
to appoint a Commission of Inquiry for the purpose of
making a full inquiry into the aforesaid matters which
are of definite public importance.
NOW, THEREFORE,· the State Government, in
exercise of the powers conferred by section 3 of the
Commission of Inquiries Act, 1952 (Act 60 of 1952),
hereby appoint a Commission of Inquiry consisting of
Shri Justice H. R. Khanna of the Delhi High Court to
inquire into and report on and in respect of :-
WHETHER THE PERSONS
MENTIONED IN
THE SCHEDULE, DURING THE
AFORESAID
PERIOD:
(I) committed various acts of malfeasance, misfeasance, misappropriation, fraud, negligence, favouritism,
nepotism, illegalities, irregillarities, improprieties and
abuse of their power in matters of administration of
the Stat11 in different cases ?
798
SuPRl!MB COU.T Ul'Ol.TS
[1968) 3 S.C.R.
(2) abused
their official positions for
securing
A
pecuniary and other benefits for themselves, the members of their families, their relations, their friends and
their partymen (Congressmen) and others in whom they
were interested, from out of the funds of the State exchequer and otherwise to the detriment of the interests
of the State ?
JI;
(3) committed breach of trust and act~ of impropriety with respect to the properties and assets of the
State with a view to further the interests of their party
organisation, i.e. the Congress ?
( 4) entered i!l'!o contracts and other monetary
transactions for the supply
of · machinery,
stores,
equipment and execution of works or permitted their
family members, relations, friends and others in whom
they were interested, with the Government of Orissa,
in utter disregard of· the law, rules and administrative
procedure relating thereto and in breach of the confidence· reposed on them, by virtue of their constitutional
position?
(5) resorted to. misuse of power' interfered in the
process cif election and administration of local bodillS
not only to help their friends, favourites and partymen,
but also at times for their own personal benefit?
(6) acquired directly properties of the State either
for themselves pr for the benefit of members of their
families, relations · or other persons in whom and organisations in which they were interested ?
(7) advanced money and loans in favour cif themselves, members of their families, their relations and
other persons in whom they were interested, out of the
State Excheciuer ?
(8) permitted wastage, misuse and expenditure in
various ways to the detriment . of the interests of the
State without following the established rules of procedure from which the presumption ·of personal gains for
themselves directly or indirectly would arise?
(9) by way of favouritism and nepotism have caused
maladministration in matters of public services, namely,
appointments, transfers, promotions and dealing with
con11pt officers ?
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JAGANNATH RAO v. STATE (Ramaswami, I.)
799
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(10) interfered in the administration of law and tried
to pervert the course of justice by helping offenders to
escape law?
(11) by their aforesaid conduct have put the 'State
•
Government to huge financial loss which has resulted in
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a financial crisis for the State ?
(12) by their aforesaid conduct have hampered the
entire· industrial development in the State ?
(13) by iheir aforesaid conduct have given rise to
serious problems of unemployment?
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(14) by their aforesaid conduct have spread corruption in the Government machinery and have polluted
the general public morale in the State and have also
brought about a general demoralisation of the political,
social, economic and moral aspects of the Society ?
(15) by their aforesaid conduct have put the State to
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financial loss which has developed into a great economic crisis and has resulted in rapid retardation of the
progress of trade, industry and commerce, a deplorable
fall in the agricultural output, spread of 9orruption in
all wings of administration and a general ·breakdown
in the morale and character of the people of the State ?
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The Commission of Inquiry may also perform such
?the~ functions as are necessary or incidental to the
mqurry.
The Commission shall inquire into the detailed particulars pertaining to the aforesaid matters along with
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such other incidental and ancillary matters thereto that
shall be placed before them by the State Government.
The Commission shall inquire into the financial implications of the aforesaid matters.
"'
The Commission shall make its report to the State
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Government on or before 30th Apvil, 1968.
AND WHEREAS the State
Government are of
opinion ·that having regard to the nature of the inquiry
to be made· and other circumstances of the case all the
provisions of sub-section (2), sub-section (3), sub-section
(4), sub-section (5) and sub-section (6) of section 5 of
H
the Commission of Inquiry Act, 1952 shall be made
applicable to the said Commission, the State Government hereby directs that all the· said provisions shall
apply to the said Commission.
800.
SUPllDIE COUllT UPOl.TS
[1968] 3 s.c.R.
The Commission shall have its
headquarters at
A
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Bhubaneswar and may also visit such places as may be
necessary in furtherance of the inquiry.
By order of the Governor
B. B. Rath
r
Additional Secretary to Govt.
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SCHEDULE
From
To
1. Sbri Biju Patnaik
Chief Minister
Planning Bd.
23-6-1961
1-1().1963
Chairman, State
4-1().1963
29-1-1965
2. Shri Biren Mitra
Minister
23-6-1961
1-1().1963
c
Chief Minister
2-1().1963
2().2-1965
3. Sbri S . Tripathy
Minister
23-6-1961
2().2-1965
Chief Minit11ter
21-2-1965
8-3-1967
4. Sbri Hilamoni Routray
Minister
23-6-1961
25-2-1967
5. Sbri Satyapriya Mohanty
Minister
2-1().1963
24-2-1967
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6. Sbri P. V. Jagannath Rao ·
Minister
23-6-1961
8-3-1967
7. Shri H.B. Singh Mardaraj
Minister
23-6-1961
2().2-1965
8. Shri R. P. Misra
Minister
21·2-1965
25-2-1967
9. Sbri Brundaban Nayak
Deputy Minister
29-7-1962
1-1().1963
Minister
2-1().1963
28-6-1965
10. Shri T. Sanganna
Dy. Minister
29-7-1962
1-1().1963
E
Minister
2-1().1963
27-2·1967
11. Shri Prahallad Mallik
Dy. Minister
29-7-1962
28-2-1967
J 2. Sbri S. K. Sahu
Dy. Minister
29-7-1962
28-2-1967
13. Shri Anup Singh Deo
Dy. Minister
21-2-1965
8-2-1967
14. Sbri Chittaranjan Naik
Dy. Minister
21-2-1965
26-2-1967
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15. Shri Chandramohan Singh
Dy. Minister
29-7-1962
24-2-1967
B.B. Rath Additional Secretary to Govt.
On behalf of the appellants Mr. Asoke Sen put forward the
argument that the appointment of the Commission is not valid as
the notification does not state what is the purpqse for which the
enquiry was to be made. To put it differently, the argument of
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the appellants was that the notification is not related to any future
Government action or legislative policy and hence· the notification was bad.
The contention of Mr. Asoke Sen was that an
inquiry for mere collection of facts· unrelated to any future course
of Government action or legislative policy does not fall within
the purview of s. 3 of the Act and it is not a valid exercise of
H
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· statutory power· to appoint such a Commission. We are unable
to accept the argument put forward on behalf of the appellants
.as correct. The purpose of the enquiry is stated in the preamble
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JAGANNATH lAO v. STATB (Ramaswami, /,)
801
to the notification wJμch, states that "the matters aforesaid regardinJ the afore.said persons should be enquired into through a Commission of Inquiry so that facts may be found which alone will
facilitate rectification and prevention of recummce of such la~
and securing the ends of justice and establishing a moral public
order in future".
In other words, the object of the enquiry to
be made by the Commission appointed under s. 3 of the Act was
to take appropriate !e~slative or administrative measures to maintain the purity and mtegrity of political administration in the
State. In our opinion, the appointment of the Commission of
Inquiry in the present case was in valid exercise of the statutory
power by the State Government under s. 3 of the Act. Mr. Asoke
Sen referred in this connection. to the decision of this Court in
Shri Ram Krishna Dalmia v. Shri Justice S. R. Tendolkar(' ), in
which the appellant challenged the validity of the notification of
the Central Government dated December 11, 1956 appointing a
Commission of Inquiry to inquire into ·and report . in respect of
certain companies mentioned in the Schedule attached to the notification and in respect of the nature and extent of the control
and interest which certain persons named in the notification ex,
ercised over these companies.. It was held by this, Court, in agreement with the Bombay High Court, that the notification was legal
and valid except as to the last part of cl. 10 thereof which empowered the Commission to recommend the action which should
be taken as and by way of securing redress or punishment or to
act as a preventive in future cases. Clause 10 of the notification
in that case stated :
"Any irregularities, frauds or breaches of trust or
action in disregard of honest commercial practices or
contravention of any law (except contraventions in respect of which .criminal proceedings are pending in a
Gourt of Law) in respect of the companies and firms
whose afiairs are investigated by the Commission which
may come to the knowledge of the Commission and the
action which in the opinion of the Commission should
be taken as and by way of securing redress or punishment
or to act as a preventive in future cases."
The portion of Cl. 1 O of the notification which was held i0 be
ultra vires by this Court was the portion beginning with the words
"and the action" and ending with the words "in future cases".
It was argued on behalf of the appellant in that case that While
the Commission may find facts on which the Government may
take action, legislative or executive, the Commission cannot be
asked to suggest any measure, legislative or executive, to be taken
by the appropriate Government. The argument was rejected by
(!) [19591 S. C. R. 279.
802
SUPUMB COUJ.T UPOaTS
(11168) 3 S.C.ll,
this Court.
~n this oonnection, S. R. Das, C.J. speaking for tho
Court. obServed at page 294 of the Report as follows : -
"We are unable to accept the proposition so widely
enunciated. An inquiry necessarily involves investi~·
tion into facts and necessitates the collection of material
facts from the evidence adduced. before or brought to
the notice of the person or body conducting the inquiry
and the recording of its findings on those facts in its
report cannot but be regarded as ancillary to the inquiry
itself, for the inq_uiry becomes useless unless the findings
of the inquiring body are made available to the Gov·
ernment which set up the inquiry. It is, in our judg·
ment, equally ancillary that the person or body conduct·
ing the inquiry should express its own view on the facts
found by it for the consideration of the appropriate
Government in order to enable it to take such measure
as it .may think fit to do. The whole purpose of setting
up of a CommiSsion of Inquiry consisting of experts will
be frustrated and the elaborate process of inquiry will be
deprived of its utility it-the opinion and the advice of the
expert body as to the. measures the situation disclosed
calls for cannot be placed before the Government for
consideration notwithstanding that doing so cannot be
to the prejudice of anybody because it has no force of
its own. In our view the recommendations of a Com·
mission of Inquiry are of great importance to the Gov·
ernment in order to enable it to make up its mind as to
what legislative or administrative measures should be
adopted to eradicate the evil found or to implement the
beneficial objeets it has in view. From this point of
view, there can be no objection even to the Commis·
sion of . Inquiry recommending the. imposition of some
form of punishment which will, in its opinion, be suffi·
ciently deterrent to delinquents in future.
But seeing
that the Commission of Inquiry has no judicial powers
and its report will purely be recommendatory and not
effective proprlo vlgore and the statement made by any
person before the Commission of Inquiry is, under s. 6
of the Act, wholly inadmissible in evidence in any future
proceedings, civil or criminal, there can be no point in
the Commission of Inquiry making rer.ommendations
for taking any action 'as and by way of securing redress
or punishment' which, in agreement with the High
Court, we think, refers, in the context, to wrongs already
done or committed, for redress or punishment for such
wrongs, if any, has to be imposed by a court of. law
properly constituted exercising 'its own discretion on the
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JAGANNATH .RAO V, STATB (Rama.swami, /,)
803
facts and circumstances of the case and without being in
any way influenced by !he view of any person or body,
howsover august or high powered it may be. Having
regard to all these considerations it appears to us that
only that portion of the last part of cl. (10) which calls
upon the Commission of Inquiry to make recommendations about the action to be taken 'as and by way of
securing redress or punishment', cannot be said to be at
all necessary for or ancillary to the purposes of the Commission. In our view the words in the latter part of
the section, namely, 'as and by way of securing redress
or punishment', clearly go outside the scope of the
Act."
In our opinion, the ratio of this case has no application in the
present case, because there is nothing corresponding to the im·
pugned part of cl. 10, in the notification of the Orissa Government dated October 26, 1967. On the contrary, we have already
pointed out that the object to set up the Commission of Inquiry
D in the present case was to take appropriate legislative or adminis·
trative measures for maintaining h1~ standards of public conduct
and purity of political administration in the State. It follows
therefore that the notification of the Orissa Government falls within the ambit of s. 3 of the Act and must be held to be legally valid
and intra virts.
We pass on to col!Sider the next question arising in these ap·
peals, namely, whether the power was exercised by the State Government for a purposo alien to the statute. It was contended by
Mr. Asoke Sen that there was a bitter political rivalry between the
appellants on the one hand and Shri Pabitra Mohan Pradhan, Shri
· Harckrushna Mehtab, Shri Singh Deo and the other persons who
F
are at present in-charge of the Orissa administration. Reference
was made by Mr. Asoke Sen to the political history of the State
of Orissa from 1947 up to the General Elections, 1967 and in
particular to the rivalry between Sri Biju Patnaik and Sri Singh
Deo who was the leader ofOpposition in the previous Government
and a1sO to the internal rivalry between the two political groups
G in the Congress Legislative, party, one led by Shri Harekrushna
'
Mahtab and the other led by Shri Biju Patnaik and Shri Biren
Mitra; It was urged that the Commission was set up by the pre·
sent Orissa Government not in the public interest but for a .cc>llateral purpose, namely, for getting rid of Shri Biju Patnaik and
· Shri Biren Mitra and driving them out of the political life of Orissa.
H Mr. Asoke Sen .said that the object of the enquiry was charaoter
ass•ssination of Slμi Patnaik and Shri Biren Mitra and so the Com·
missiQn was set up for a collateral purpose and the notification
must bo struck down as illegal and llltra Vina. It is not poaalble,
•
804
SUPIBMB COUl.T UJIO&TI
[1968) 3 S.C.R.
in our opinion, to accept this argnment as correct, It is admitted
A ·
that there is political rivalry in Orissa between the ap~ants and
the present Chief Minister of Orissa, Shri R. ~' Sing
.
and
also as between the appellants and the group of \,;O!lgress · idents'
led by Shri Harekrushna Mahtab, Shri Nabakrusbha Ch<>udilury,
Shri Pabitra Mohan Pradhan, Shri Santanu Kumar Das and Shri
Surendranath Patnaik. But we do not think that the existence of a
political rivalry is in itself sufficient. to hold that the appointment
of the Commission of Inquiry is illegal. Having perused the affi·
davits of the appellants and also those filed by the respondents in
this case we are of opinion that the appointment of the Commission of Inquiry was not due merely to the existence of political
rivalry of the parties but was impelled by the desire to set up and c
maintain high standards of moral conduct in the political ad·
ministration of the State. As we have already pointed out, the
object of appointing the Commission is stated in the notification
itself as "the rectification and prevention of recurrence of such
lapses ll!id securing the ends of justice and establishing a moral
public order in future". In the affidavit of Shti Pabitra Mohan
D
Pradhan it is stated that the appointment of the Commission of
Inquiry was one of the items of the common programme on which
the 1ana Congress and the Swatantra Party contested the General
Elections of 1967. As a result of the popular mandate the Swatantra Party and the 1 ana Congress coalition took charge of the reins
of Government and in accordance with the solemn promise made
by those parties to the people of Orissa the Government decided'
It
to appoint a Commission of Inquiry in order to investigate the
widespread corruption practised by the persons named in 'the Schedule to the impugned notification. The decision to appoint a
Commission was also announced in the first address of the Governor
to the Otissa Legislative Assembly after the 1967 General Elec·
tions.