# HARSHAD S. MEHTA AND ORS v. THE STATE OF MAHARASHTRA SEPTEMBER 6, 200 I .B

- **Citation:** [2001] Supp. 2 S.C.R. 577
- **Court:** Supreme Court of India
- **Decided:** 2001
- **Case number:** Criminal Appeal Nos. 319320 of 1996
- **Bench:** S.P. Bharucha, Y.K. Sabharwal, Brijesh Kumar
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/harshad-s-mehta-and-ors-v-the-state-of-maharashtra-september-6-200-i-b-18162
- **Pages:** 40

## Headnote

Code of Criminal Procedure, 1973:
Special Court (Trial of Offences Relating to Transactions in Securities)
Act, 1992-Sections 6.7,9(2) and (4), 13--Code of Criminal Procedure, 1973- C
Sections 6, 157, 306, 307, and 308-Power of Special Court to grant pardon--'
Held, is a substantive power and not an inherent power-Power to Special
Court not denied either expressly or impliedly under the Act-All proceedings
relating to offences under the Act is committed before the Special Court and
not before criminal courts constituted under Cr PC-Special Court has all the D
powers available to a criminal court-Hence, Special Court has power to
grant pardon at any stage of the proceedings.
Interpretation of Statutes:
Doctrine of implied repeal-Applicability of-Held, there in no E
inconsistency between the provisions of Cr PC and the Act-Hence, the doctrine
is not applicable.
Harmonious Construction-Held, the provisions of the Act and the Cr Pc
must be harmoniously construed without causing any confasion or resulting
in absurd consequences. Special Court (Trial of Offences Relating for F
Transactions in Securities) Act, 1992--Code of Criminal Procedure, 1973.
Accused P and C filed applications before the Special Court set up under
the Special Court (Trial of Offences Relating to Transactions in Securities)
Act, 1992 for grant _of pardon. The applications were supported by Central
Bureau of Investigation with a view to obtain evidence. The accused earlier G
made statements under Section 164 of the Criminal Procedure Code, 1974
before a Magistrate. The Special Court granted conditional pardon to the
accused. Appellants filed applications before the Special Court seeking
revocation of the pardon granted to the accused on the ground·that the Special
Court had no such power under the Act. The applications were dismissed by H
577
578
SUPREME COURT REPORTS [2001) SUPP. 2 S.C.R.
A the Special Court.
In appeal to this Court, the appellants contended that the order of the
Special Court granting pardon is without jurisdiction; that the power to grant
pardon is not inherent power but a substantive power which is not conferred
specifically under the Act; that the power the grant pardon contain in sections
B 306 and 307 CrPC is not applicable to the proceedings before the Special
Court constituted under the Act; that the Legislature deliberately never
intended to confer the power on the Special Court under the Act and which
was specifically conferred under similar earlier enactments like Criminal Law
(Amendment) Act, 1952 (since repealed) and the Special Courts Act, 1979;
C that section 307 CrPC is not applicable since no commitment of the case is
made to the Special Court; that at pre-cognizance stage_, no power of any
nature has been conferred to the Special Court under the Act; that it is only
that court of original jurisdiction, on which special power of pardon is
conferred, can exercise such power; that the Special Court will have the power
to grant pardon only after commitment of the case; that the power is not
D available during investigation of the offence; and that the power contained
in section 308 CrPC to punish the accused for violation of the terms and
conditions of the pardon has not been conferred to the Special Court.
The appellants further contended, the provisions of the Act, which is a
later enactment, impliedly repeals the earlier enactment i.e. CrPC in
E accordance with the max·im leges posteriores priores contertrios abrogant (later
laws abrogate earlier laws); and that the presumption against the implied
repeal stands rebutted as the provisions of the Act are inconsistent with or
repugnant to the provisions of the earlier Acts and that the two cannot stand
together.
F
G
The respondent-State contended that the earlier enactments referred
to by the appellants are only an external aid for interpretation of the provisions
of the Act; that the scheme of the enactments and the present Act is entirely
different and that the omission of powe

## Text

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.....
HARSHAD S. MEHTA AND ORS.
A
v.
THE STATE OF MAHARASHTRA
SEPTEMBER 6, 200 I
.B
[S.P. BHARUCHA, Y.K. SABHARWAL AND BRIJESH KUMAR, JJ]
Code of Criminal Procedure, 1973:
Special Court (Trial of Offences Relating to Transactions in Securities)
Act, 1992-Sections 6.7,9(2) and (4), 13--Code of Criminal Procedure, 1973- C
Sections 6, 157, 306, 307, and 308-Power of Special Court to grant pardon--'
Held, is a substantive power and not an inherent power-Power to Special
Court not denied either expressly or impliedly under the Act-All proceedings
relating to offences under the Act is committed before the Special Court and
not before criminal courts constituted under Cr PC-Special Court has all the D
powers available to a criminal court-Hence, Special Court has power to
grant pardon at any stage of the proceedings.
Interpretation of Statutes:
Doctrine of implied repeal-Applicability of-Held, there in no E
inconsistency between the provisions of Cr PC and the Act-Hence, the doctrine
is not applicable.
Harmonious Construction-Held, the provisions of the Act and the Cr Pc
must be harmoniously construed without causing any confasion or resulting
in absurd consequences. Special Court (Trial of Offences Relating for F
Transactions in Securities) Act, 1992--Code of Criminal Procedure, 1973.
Accused P and C filed applications before the Special Court set up under
the Special Court (Trial of Offences Relating to Transactions in Securities)
Act, 1992 for grant _of pardon. The applications were supported by Central
Bureau of Investigation with a view to obtain evidence. The accused earlier G
made statements under Section 164 of the Criminal Procedure Code, 1974
before a Magistrate. The Special Court granted conditional pardon to the
accused. Appellants filed applications before the Special Court seeking
revocation of the pardon granted to the accused on the ground·that the Special
Court had no such power under the Act. The applications were dismissed by H
577
578
SUPREME COURT REPORTS [2001) SUPP. 2 S.C.R.
A the Special Court.
In appeal to this Court, the appellants contended that the order of the
Special Court granting pardon is without jurisdiction; that the power to grant
pardon is not inherent power but a substantive power which is not conferred
specifically under the Act; that the power the grant pardon contain in sections
B 306 and 307 CrPC is not applicable to the proceedings before the Special
Court constituted under the Act; that the Legislature deliberately never
intended to confer the power on the Special Court under the Act and which
was specifically conferred under similar earlier enactments like Criminal Law
(Amendment) Act, 1952 (since repealed) and the Special Courts Act, 1979;
C that section 307 CrPC is not applicable since no commitment of the case is
made to the Special Court; that at pre-cognizance stage_, no power of any
nature has been conferred to the Special Court under the Act; that it is only
that court of original jurisdiction, on which special power of pardon is
conferred, can exercise such power; that the Special Court will have the power
to grant pardon only after commitment of the case; that the power is not
D available during investigation of the offence; and that the power contained
in section 308 CrPC to punish the accused for violation of the terms and
conditions of the pardon has not been conferred to the Special Court.
The appellants further contended, the provisions of the Act, which is a
later enactment, impliedly repeals the earlier enactment i.e. CrPC in
E accordance with the max·im leges posteriores priores contertrios abrogant (later
laws abrogate earlier laws); and that the presumption against the implied
repeal stands rebutted as the provisions of the Act are inconsistent with or
repugnant to the provisions of the earlier Acts and that the two cannot stand
together.
F
G
The respondent-State contended that the earlier enactments referred
to by the appellants are only an external aid for interpretation of the provisions
of the Act; that the scheme of the enactments and the present Act is entirely
different and that the omission of power of granting pardon in the Act does
not mean that the Legislature never intended to confer the power.
Dismissing the appeals, the Court
HELD: 1.1. Penal laws require that punishment shall be inflicted on
every person found guilty of an offence under those laws. The grant of pardon
results in the grantee escaping the punishment for the offence. The nature of
H power of pardon under section 306 and 307 CrPC is essentially different than
-
HARSHAD S. MEHTA v. STATE OF MAHARASHTRA
579
the nature of such power under the Constitution of India whereby the A
President and/or Governor are empowered to grant pardon. Those powers
are exercised after a person is found guilty. Under sections 306 and 307 CrPC,
pardon is tendered during investigation, enquiry or trial. The object is to
obtain evidence of an accomplice so as to facilitate conviction of others. Such
a power has to be conferred specifically. It is a substantive power. The power B
has to be derived from the statutory provisions. Section 306 confers the power
to grant pardon in respect of serious offen~es and on certain class of
Magistrates. From the scheme of the section and having regard to the nature
of the power, power to grant pardon is not an inherent power of a criminal
court and is a substantive power to be specifically conferred. Such a
substantive power does not flow from section 9( 4) of the Special Court (Trial C
of Offences Relating to Transactions in Securities) Act, 1992 and to this extent
the Special Court was not right in concluding that section 9(4), on account of
the wide powers it confers, would include amongst others a right on the Special
Court to grant pardon. Section 9( 4) does not confer on the Special Court any
such power. Section 9(4) is in the nature of a general provision. It confers
inherent powers on the Special Court to deal with any matter that may be D
brought before it providing that for dealing with such matter the Special Court
may adopt its own procedure consistent with the principles of natural justice.
The conferment of that inherent power does not include the power to grant
pardon, which cannot be said to be a matter of procedure. (590-C-H; 591-Af
1.2. The Act does not contain any independent machinery or provision E
for the purpose of investigation, enquiry or trial. It has no legs of its own to
stand. It has borrowed the legs from CrPC. The legislative device of
incorporation by reference is well known and duly recognised device. This
device is adopted for the purpose of convenience. It obviates the need to
reproduce the provisions of an existing statute sought to be adopted in a later F
statue. This is what has been done while enacting the Act. Instead of
reproducing the provisions of CrPC, it has incorporated those provisions in
the Act by so providing in Section 9(2) but at the same time, the Act maintains
its own superiority as stated therein and also in section 13. Neither Section
9(2) nor section of the Act nor any other provision in the Act expressly exclude G
the applicability of sections 306 and 307 CrPC to the proceedings before the
Special Court. [591-C, D, E]
1.3. If powers wider than the one contemplated by CrPC are intended
to be conferred, a provision to that effect will have to be made. It does not
follow therefrom that in an altogether different statute, if no special provision H
580
SUPREME COURT REPORTS [2001] SUPP. 2 S.C.R.
A is made, an inference can be drawn that even where the powers under CrPC
and not wide powers are intended to be conferred, save and except where it
is so stated specifically, the effect of omission would be that the Special Court
will not have even similar power as are exercised by the ordinary criminal
courts under CrPC. [601-G, H; 602-A)
B
State of Tamil Nadu v. V. Krishnaswami Naidu and Anr., [1979) 3 SCR
928; Lt. Commander Pascal Fernandes v. The State of Maharashtra and Ors.,
[1968) l SCR 695; State Of UP. v. Kai/ash Nath Agarwal and Ors., [1973] l
sec 751, referred to
1.4. The institution of the prosecution as envisaged by section 7 of the
C Act is wider than taking congnizance of or trying of such cases as provided
in section 6. It does not appear from the language of sections 6 and 7 read
with sections 3 and 9 of the Act that at pre cognizance stage all steps including
those of remand, bail are required to be taken before the normal criminal
courts constituted under section 6 CrPC. After the enforcement of the Act,
D the legislature has not intended that in relation to the offences under the Act,
the normal criminal courts should continue to have power at the stage earlier
to taking of cognizance by the Special Court. Further, all such proceedings
including those of remand, bail, production of the accused at pre-cognizance
stage have always been taken before the Special Court and not before criminal
courts constituted under CrPC. A Magistrate has no power to grant pardon
E under Section 306 CrPC to alleged offenders under the Act at any stage of
the proceedings. [604-C-E]
1.5. The Special Court has all the powers of a Court of Session and/or
Magistrate, as the case may be, after the prosecution is instituted or
transferred before that Court. The width of the power of the Special Court
F will be the same whether trying such cases as are instituted before it or
transferred to it. The use of different words in Sections 6 and 7 of the Act
show that the words in section 7 that the prosecution for any offence shall be
instituted only in the Special Court deserve a liberal and wider construction.
They confer on the Special Court all powers of the Magistrate including the
one at the stage of investigation or enquiry. Here, the institution of the
G prosecution means taking any steps in respect there of before the Special court.
The scheme of the Act nowhere contemplates that it is was intended that steps
at pre-cognizance stage shall be taken before a court other than a Special
Court. [606-F-H; 607-A)
J.K. Cotton Spinning & Weaving Mills Co. Ltd v. State of UP. and Ors.,
H AIR 1961 SC (1170) Willie (William) Slaney v. State of Madhya Pradesh, AIR
-
HARSHAD S. MEHTA v. STATE OF MAHARASHTRA
581
(1956) SC 116, referred to.
1.6. Section 9(1) of the Act provides that the Special Court in the trial ·
of such cases follow the procedure prescribed by Cr PC for the trial of warrant
cases before the Magistrate. The expression 'trial' is not defined in the Act or
A
the CrPC. For the purpose of the Act, it has a wider connotation and also
includes in it the pre-trial stage as well. Section 9(2) makes the Special Court, B
a Court of Session by a fiction by providing that the Special Court shall be
deemed to be a Court of Session and shall have all the powers of a Court of
Session. In case, the Special Court is held not to have the dual capacity and
power both of the Magistrate and the Court of Session, depending upon the
stage of the case, there will be a complete hiatus. The Special court under the C
Act comprises of a High Court Judge and it is a court of exclusive jurisdiction
in respect of any offence as provided section in 3(2) which will include offences
under the Indian Penal Code, Prevention of Corruption Act and other penal
laws. It is only in the event of inconsistency that the provisions of the Act would
prevail as provided in section 13 thereof. Any other interpretation will make
the provision of the Act unworkable which is not the intention of the D
Legislature. Section 9(2) does not exclude sections 306 to 308 CrPC from the
purview of the Act. This section rather provides that the provisions of the
CrPC shall apply to the proceedings before the Special Court. The
inconsistency seems to be only imaginary. There is nothing in the Act to show
that Section 306 to 308 were intended to be excluded from the purview of the E
Act. (607-C-G]
1. 7. The CrPC ·has been incorporated in the Act by application of the
doctrine of legislation by incorporation. The power to grant pardon has not
been denied expressly or by necessary implication. It was not necessary to
make specific provision in the Act conferring power on the Special Court to p
grant pardon at trial or pre-trail stage. The Special Court is a court of original
criminal jurisdiction and has all the powers of such a court under the CrPC
including those of Sections 306 to 308 CrPC, the same not having been
excluded specifically or otherwise. (611-E-F]
A.R. Antulay v. Ramada.s Sriniwas Nayak and Anr., (1984] 2 SCC 500, G
relied on.
l.8. There is no provision in the Act which negates the power of the
Special Court to grant pardon. The Special Court has power to grant pardon
at any stage of the proceedings. The power under Section 307 cannot be denied
merely because no commitment of the case is made to the Special Court. Other H
582
SUPREME COURT REPORTS (2001] SUPP. 2 S.C.R.
A statutes are only an external aid to the interpretation. The scheme of the two
Acts are substantially different. The provisions of Sections 6 and 7 of the Act
confer much wider power. Everything after institution of the prosecution is
required to be done by the Special Court. There is nothing in those provisions
or in section 9 to warrant exclusion of sections 306 to 308 CrPC from the
B purview of the Act. (611-F, G, H; 612-A]
1.9. The fact that there is no commitment to the Special Court only
shows that the section will apply to the extent applicable but that does not
lead to exclusion of the power of the Special Court to grant pardon. Section
6 of the Act doe~ away with the procedure of commitment of a case to the
C Sessions Court. It is the Special Court which is to take cognizance of the cases
instituted before it or transfe11red to it. Another deviation is provided in Section
7 of the Act which stipulates that any prosecution of any offence relating to
transactions in securit1es shall be instituted only in Special Court. Provisions
of the CrPC not inconsistent with the Act shall apply to the proceedings before
the Special Court under Section 9(2) of the Act. (612-F, G, HJ
D
Directorate of Enforcement v. Deepak Mahajan and Anr., (1994) 1 SCR
445 and Harihar Sinha and Ors. v. Emperor, AIR (1936) Calcutta 356 (FB),
referred to.
1.10. The power to tender pardon is not controlled by sub-sections (4)
E or (5) of Section 306 CrPC. These sub-sections deal with the matters pertaining
to post-pardon stage. These provisions only show that where there is no
commitment, sub-section (5) of Section 306 will not apply. But this does not
take away the power of pardon as provided in sub-section (1) of section 306.
It only means that these provisions will apply to the extent applicable.
F
(613-A, Bl
2. One of the important tests to determine the issue of implied repeal
would be whether the provisions of the Act are irreconcilably with the
provisions of CrPC; that the two cannot stand together or the intention of
the legislature was only to supplement the provisions of CrPC. This intention
G is to be ascertained from the provisions of the Act. Courts lean against implied
repeal. If, by any fair interpretation, both the statutes can stand together, there
will be no implied repeal. If possible implied repeal should be avoided. The
presumption against the intent to repeal by implication is overthrown if the
new law is inconsistent with or repugnant to the old law, for the inconsistency
or repugnance reveals an intent to repeal the existing laws, Repugnance must
H be such that the two statutes cannot be reconciled on reasonable construction
HARSHAD S. MEHTA v. STA TE OF MAHARASHTRA
583
or hypothesis. They ought to be clearly and manifestly irreconcilable. It is A
possible that the inconsistency may operate on a part of a statute. If the words
are plain and simple and call for only one construction that construction is
to be adopted whatever be its effect. There is no express provision in the Act
excluding therefrom the applicability of Sections 306 and 307 CrPC.
[597-D, E, F; 599-C, E)
S.P. Gupta and Ors. etc. etc. v. Union of India and Ors. etc. etc., AIR (1982)
SC 149 (CB); The Commissioner of Sales Tax, UP., Lukhnow v. Mis Parson Tools
and Plants, Kanpur, [1975) 4 SCC 22 and Harcharan Singh v. Smt. Shivrani
and Ors., (1981) 2 SCC 535, referred to.
B
Lord Howard De Walden v. Inland Revenue Commissioners, [1948) 2 All C
E.R. 825 and Johnson and Anr. v. Moreton, (1978) 3 All E. R. 37, referred to.
Statutory Interpretation by Francis Bennion, (1984) Edition, referred to.
3. The power to tender pard6111 stands alone and others are matter of
procedure. If in a situation, the matters of procedure are not applicable, it D
would not negate the power to grant pardon .. Insofar as procedural matters
are concerned, it would only mean that the same apply to the extent applicable.
Thus it cannot be said that there was any implied repeal. It cannot also be
said that it was intended by necessary implication that the Special Court under
the Act shall not have the power to grant pardon. All Powers of Sections 306 E
to 308 CrPC to the extent applicable and can be complied are available to
the Special Court under the Act. The provision of the Act and the CrPC can
stand together.- There is no inconsistency. The two statutory provisions can
harmoniously operate without causing any confusion or resulting in absurd
consequences and the scheme of CrPC can, without any difficulty, fit in the
scheme of the Act. The jurisdiction to try a case is conferred on the Special
Court not by committal bnt by the statute which has established that Court.
[616-D, E, F)
CRIMINAL APPELLATE JURISDICTION : Criminal Appeal Nos. 319320 of 1996.
From ·the Judgment and Order dated 6.2.96 of the Special Court at
Bombay in Misc. Application Nos. 10 and 11 of 1966.
F
G
Harish N. Salve, Solicitor General, Rakesh Dwivedi, Jaspal Singh, Ram
Jethmalani, V.G. Pradhan, R.K. Jain, Harish Gulati, Ms. Geetanjali Mohan,
Aron K. Sinha, Rakesh Singh, Ms. Kamini Jaiswal, Mahesh Jethmalani, Ms. H
584
SUPREME COURT REPORTS (2001] SUPP. 2 S.C.R.
A Shomila Bakshi, Rani Jethmalani, Ms. Gouri K. Das, Ms. Susila Ram, A.D.
B
c
Chaugule, P.G. Sabnis, Ms. Gitanjali Malviya, Saurabh Avasthi, Pervez A.
Siddiqui Surender Chandra Gupta, A. Subba Rao, R.S. Mhamane, Tara
Chandra Sharma, P. Parmeswaran, Ms. Lata Krishnamurthi, Ms. Sushma
Suri, Ajay Bhalla, P.K. Goswami, P.K. Jain, S.V. Deshpande, Bishwajit
Bhattacharya, Ranjan Mukherjee, Ms. Puja Khatkar for the appearing parties.
The Judgment of the Court was delivered by
Y.K. SABHARWAL, J. Criminal Courts are normally constituted under
the provisions of the Criminal Procedure Code. Section 6 of the Code of
Criminal Procedure, 1973 (for short, 'the Code') provides for the classes of
criminal courts. In addition to the provisions contained in the Code or the old
Code of 1898, from time to time, enactments have been passed providing that
in respect of certain offences, there will be a Special Court manned by persons
having specified qualifications. In the present appeals, we are concerned with
such an enactment, namely. The Special Court (Trial) of Offences Relating
D to Transactions in Securities) Act, 1992 ('the Act' for short). The passing of
the Act was preceded by an Ordinance which was promulgated on 6th June,
1992.
It is an Act to provide for the establishment of a Special Court for the
trial of offences relating to transactions in securities and for matters connected
E therewith or incidental thereto. In the year 1992, large scale irregularities and
malpractices were noticed by the Reserve Bank of India in relation to
transactions in both the Government and other securities, indulged in by
some brokers in collusion with the banks and financial institutions. The said
irregularities and malpractices led to the diversion of funds from banks and
F
financial institutions to the individual accounts of certain brokers. The Act
deals with the situation and in particular to ensure speedy recovery of the
huge amount involved, to punish the guilty and restore confidence in and
maintain the basic integrity and credibility of the banks and financial
institutions.
G
The Act provides for establishment of Special Court to consist of one
or more sitting Judges of the High Court nominated by the Chief Justice of
the High Court within the local limits of whose jurisdiction the Special Court
is situated, with the concurrence of the Chief Justice of India. Section 6 of
the Act provides that the Special Court shall take cognizance of or try cases
as are instituted before it or transferred to it. Section 3 provides for appointment
H and functions of custodian. Sub-section (2) of Section 3 provides that the
HARSHAD S. MEHTA v. STATE OF MAHARASHTRA [Y.K. SABHARWAL, J.] 585
custodian may, on being satisfied on information received that any person A
has been involved in any offence relating to transactions in securities after
the first day of April, 1991 and on or before 6th June, 1992, notify the name
of such person in the Official Gazette. 'Securities' includes :
(i) shares, scrips, stocks, bonds, debentures, debenture stock, units of
the Unit Trust of India or any other mutual fund or other marketable B
securities of a like nature in or of any incorporated company or other
body corporate:
(ii) Government securities; and
(iii) Rights or interests in securities.
Section 7 provides for the exclusive jurisdiction of Special Court and
stipulates that notwithstanding anything contained in any other law, any
prosecution in respect of any offence referred to in sub-section (2) of Section
3 shall be instituted only in the Special Court and any prosecution in respect
c
of such offence pending in any court shall stand transferred to the Special D
Court. The Special Court, therefore, is a court of exclusive jurisdiction in
respect of offences referred to in sub-section (2) of Section 3.
Section 9 of the Act lays down the procedure and powers of Special
Court and stipulates the following of the procedure prescribed by the Code
for the trial of warrant cases before a Magistrate. Section 9(2), inter alia, E
provides for the applicability of the provisions of the Code to the proceedings
before the Special Court insofar as they are not inconsistent with the provisions
of the Act. As provided in this· provision, the Special Court is deemed to be
a Court of Session. The main bone of contention is the interpretation of
Section 9 which reads as under :
"9. Procedure and powers of Special Court.-
(I) The Special Court shall, in the trial of such cases, follow the
procedure prescribed by the Court for the trial of warrant cases before
a magistrate.
(2) Save as expressly provided in this Act, the provisions of the Code
shall, insofar as they are not inconsistent with the provisions of th is
Act, apply to the proceedings before the Special Court and for the
purposes of the said provisions of the Code, the Special Court shall
be deemed to be a Court of Session and shall have all the powers of
F
G
a Court of Session, and the person conducting a prosecution before H
586
SUPREME COURT REPORTS [2001) SUPP. 2 S.C.R.
A
the Special Court shall be deemed to be a Public Prosecutor.
(3) The Special Court may pass upon any person convicted by it any
sentence authorized by law for the punishment of the offence of
which such person is convicted.
B
(4) While dealing with any other matter brought before it, the Special
Court may adopt such procedure as it may deem fit consistent with
the principles of natural justice."
The Act has an overriding effect as provided in Section 13 which, inter
alia, stipulates that the provisions of the Act shall have effect notwithstanding
C anything inconsistent therewith contained in any other law for the time being
in force. Section 14 is the rule making power of the Central Government.
Section 15 repeals the Ordinance.
The circumstances under which these appeals have come up in brief
are that on 21st June, 1993 two separate applications were filed before the
D Special Court under the provisions of the Code, one by Sarvotham Vishwanath
Prabhu and the other by Bhaskar Roy Choudhury praying for grant of pardon.
These applications were supported by the Central Bureau of Investigation.
Prabhu and Choudhury had earlier made statements under Section 164 of the
Code before the Magistrate. It is claimed that in those statements they
E voluntarily and willingly made full disclosure of their participation in the
offences and also participation of other accused in commission of the offences.
The investigating officer suppo1ting the application for grant of pardon stated
before the Special Court that with a view to obtain the evidence of these two
accused who are directly or indirectly concerned in or privy to offences
which were under investigation, it is necessary and desirable, as well as in
F the interests of justice, that their applications praying for tender of pardon to
them be suppo1ted so that all the facts and circumstances relating to the
commission of offences and also the manner of participation by other accused
may come on record during the trial. The Special Court, by order dated 22nd
June, 1993, granted the application of both the accused on the condition that
G they will give evidence during the trial and make a full and true disclosure
of the whole of the circumstailces within their knowledge relating to the
offence and to other problems. The conditional tender of pardon was accepted
by Prabhu and Chaudhury.
The appellants by applications dated 9th January, 1996 filed before
H the Special Court sought revocation of the pardon. It was pleaded in the
HARSHAD S. MEHTA v. STATE OF MAHARASHTRA [Y.K. SABHARWAL, J.] 587
applications that the pardon granted to Prabhu and Chaudhury was void and A
non-est in the eyes of law mainly on the ground of Jack of jurisdiction of the
Special Court to grant par.don. It was urged that the po'Wer to grant pardon
had to be expressly conferred; there is no inherent power in any court to
grant pardon and that no such power had been conferred on the Special
Court.
The applications seeking revocation were dismissed by the Special Court
by order dated 6th February, 1996 holding that the Special Court has the
power to tender pardon. The Special Court rejected the contention that the
orders dated 22nd June, 1993 were without jurisdiction. The legality of the
B
order dated 6th February, 1996 is in issue before us.
C
Chapter XXIV of the Code deals with the general provisions as to
inquiries and trials. Sections 300 to 327 are in this Chapter. Sections 306 and
307 deal with tender of the pardon to accomplice. Section 306 confers power
on Magistrates and Section 307 on the court to which the commitment is
made. Section 308 provides for the consequences of not complying with the D
conditions of pardon by a person who has accepted tender of pardon made
under Section 306 or Section 307. These three sections read as under :
"306. Tender of pardon to accomplice.-(1) With a view to obtaining
the evidence of any person supposed to have been directly or indirectly
concerned in or privy to an offence to which this section applies, the E
Chief Judicial Magistrate or a Metropolitan Magistrate at any stage of
the investigation or inquiry into, or the trial of, the offence, and the
Magistrate of the first class inquiring into or trying the offence, at
. any stage of the inquiry or trial, may tender a pardon to such person
on condition of his making a full and true disclosure of the whole of F
the circumstances within his knowledge relative to the offence and to
every other person concerned, whether as principal or abettor, in the
commission thereof.
(2) This section applies to-
(a) any offence triable exclusively by the Court of Session or by the
Court of a Special Judge appointed under the Criminal Law
Amendment Act, 1952 ( 46 of 1952)
(b) any offence punishable with imprisonment which may extend to
seven years or with a more severe sentence.
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SUPREME COURT REPORTS [2001] SUPP. 2 S.C.R.
A
(3) Every Magistrate who tenders a pardon under sub-section (I)
shall recordB
(a) his reasons for so doing;
(b) whether the tender was or was not accepted by the person to
whom it was made, and shall, on application made by the accused,
furnish him with a copy of such record free of cost.
(4) Every person accepting a tender of pardon made under sub-section
(I)-
(a) shall be examined as a witness in the Court of the Magistrate
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taking cognizance of the offence and in the subsequent trial, if
any;
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(b) shall, unless he is already on bail, be detained in custody until
the termination of the trial.
(5) Where a person has accepted a tender of pardon made under subsection (I) and has been examined under sub-section ( 4 ), the Magistrate
taking cognizance of the offence shall, without making any further
inquiry in the case,-
(a) commit it for trial-
(i) to the Court of Session if the offence is triable exclusively
by that Court or if the Magistrate taking cognizance is the
Chief Judicial Magistrate;
(ii) to a Court of Special Judge appointed under the Criminal
Law Amendment Act 1952 ( 46 of 1952), if the offence is
triable exclusively by that Court;
(b) in any other case, make over the case to the Chief Judicial
Magistrate who shall try the case himself.
307. Power to direct tender of pardon.-At any time after commitment
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of a case but before judgment is passed, the Court to which the
commitment is made may, with a view to obtaining at the trial the
evidence of any person supposed to have been directly or indirectly
concerned in, or privy to, any such offence, tender a pardon on the
same condition to such person.
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308. Trial of person not complying with conditions of pardon.-( 1)
HARSHAD S. MEHTA 1•. STATEO~ MAHARASllTRA IY K. SAIJHARWAL, J.l 589
Where, in regard to a person who has accepted a tender of pardon A
made under Section 306 or section 307, the Public Pr.osecutor certifies
that in his opinion such person has, either by wilfully concealing
anything essential or by giving false evidence. not complied with the
condition on which the tender was made, such person may be tried
for the offence in respect of which the pardon was so tendered or for
any other offence of which he appears to have been guilty in
connection with the same matter, and also for the offence of giving
false evidence :
I
Provided that such person shall not be tried jointly with any of
the other accused:
Provided further that such person shall not be tried for the offence
of giving false evidence except with the sanction of the High Court,
and nothing contained in section 195 or section 340 shall apply to that
offence.
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(2) Any statement made by such person accepting the tender of D
pardon and recorded by a Magistrate under section 164 or by a Court
under sub-section ( 4) of section 306 may be given in evidence against
him at such trial.
(3) At such trial, the accused shall be entitled to plead that he has
complied with the condition upon which such tender was made, in E
which case it shall be for the prosecution to prove that the condition
has not been complied with.
( 4) At such trial the Court shall-
(a)
If it is a Court of Session, before the charge is read out and F
explained to the accused;
(b)
if it is the Court of a Magistrate before the evidence of the
witnesses for the prosecution is taken, ask the accused whether
he pleads that he has complied with the conditions on which the
tender of pardon was made.
(5) If the accused does so plead, the Court shall record the plea and
proceed with the trial and it shall, before passing judgment in the
case, find whether or not the accused has complied with the conditions
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of the pardon, and, if it finds that he has so complied, it shall
notwithstanding anything contained in this Code, pass judgment of H
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SUPREME COURT REPORTS [2001) SUPP. 2 S.C.R.
acquittal."
The question for determination is whether the pardon prov1s1on as
contained in Sections 306 and 307 of the Code apply or not to the proceedings
before the Special Court under the Act. We were also told that in Criminal
Appeal No. I 097 of 1999 Ram Narain Pop~v v. Cei7/ral Bureau of Investigation
B one of the questions is as to the power of a Magistrate to grant pardon to
a person accused of an offence that falls within the purview of the Act.
Counsel were given the opportunity to address arguments on this question
as well.
To answer the question, it is necessary to closely scrutinise and consider
C the provisions of the Act, the Code and other enactments relied upon by
Mr.Jethmalani and the effect of the said enactments on the interpretation of
the provisions of the Act.
Penal laws require that the punishment shall be inflicted on every
D person found guilty of an offence under those laws. The grant of pardon
results in the grantee escaping the punishment for the offence. The nature
of power of pardon under Sections 306 and '307 is essentially different than
the nature of such power under the Constitution of India whereby the President
and/or Governor are empowered to grant pardon. Those powers are exercised
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after a person is found guilty. That is not so here. Under Sections 306 and
307, the pardon is tendered during the investigation, enquiry or trial, as the
case may be. The object is to obtain evidence of an accomplice so as to
facilitate conviction of others. Undoubtedly, as contended by Mr.Jethmalani,
such a power has to be conferred specifically. It is a substantive power. The
power has to be derived from the statutory provisions. Section 306 confers
the power to grant pardon in respect of serious offences and on certain class
of Magistrate. From the scheme of the section and having regard to the nature
of the power, we find that Mr. Jethmalani is right in contending that the power
to grant pardon is not an inherent power of a criminal court and is a substantive
power to be specifically conferred. It, therefore, follows that such a substantive
power does not flow from Section 9( 4) of the Act and to this extent the
G learned Special Cou11 was not right in concluding that Section 9(4), on
account of the wide powers it confers, would include amongst others a right
on the Special Court to grant pardon. Section 9( 4) of the Act does not confer
on the Special Com1 any such power. Section 9(4) is in the nature ofa general
provision. It confers inherent powers on the Special Court to deal with any
matter that may be brought before it providing that for dealing with such a
H matter the Special Court may adopt its own procedure consistent with the
HARSHAD S. MEHTA v. STATE OF MAHARASHTRA (Y.K. SABHARWAL, J.]
591
principles of natural justice. Sections 3 and 4 of the Act show that variety A
of matters could corrie up before the Special Court for its consideration and
for dealing with those matters, the Special Court was empowered to regulate
its own procedure consistent with the principles of natural justice. The
conferment of that inhere~t power does not include the power to grant
pardon, which cannot be said to be a matter of procedure ..
Our view in respect of Section 9(4), however, does not conclude the
matter for that the main question is about the interpretation of Section 9(2)
of the Act. Does it exclude the applicability of Sections 306 and 307 while
making applicable the provisions of the Code to the proceedings before the
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Special Court, is the real question.
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The Act contains fifteen sections. Most of these have already been
noticed by us hereinbefore; It is evident therefrom that the Act does not
contain any independent machinery or· provision for the purpose of
investigation, enquiry or trial. For these matters it has no legs of its own to
stand. It has borrowed the legs from the Code. The legislative device of D
incorporation by reference is well known and duly recognised device. This
device is adopted for the purpose of convenience. It obviates the need to
reproduce the provisions of an existing statute sought to be adopted in a later
statute. This is what has been done while enacting the Act. Instead of
reproducing the provisions of the Code, it has incorporated those provisions
in the Act by so providing in Section 9(2) but at the same time, the Act E
maintaining its own superiority as stated therein and also in Section 13.
Neither Section 9(2) nor Section 13 nor any other provision in the Act
expressly exclude the applicability of Sections 306 and 307 to the proceedings
before the Special Court. Whether it is so excluded by necessary implication F
is an aspect which needs serious consideration.
Mr. Jethmalani, learned counsel appearing for the appellant, contends
that Sections 306 and 307 have not been extended to the Special Court under
the Act. It is contended that the Speeial Court is not a clas.s of a court
enumerated in sub-section (I) of ~ection 306 or a court as contemplated by G
Section 307 to which commitment is made. Therefore, the contention is that
neither Section 306 nor Section 307' is applicable to the proceedings before
the Special Court under the Act and· hence that court has no power or
jurisdiction to tender pardon. Learned counsel further contends that it was
a matter of policy for the law makers to confer or not upon the Special Court
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SUPREME COURT REPORTS [2001] SUPP. 2 S.C.R.
A such a power and in their wisdom, probably considering the gravity of the
offence and situation with which the country was confronted, it took a policy
decision not to confer power of pardon so that no one should escape
punishment and every accused is equally treated. Learned counsel contends
that this course was adopted by the legislature despite the fact that law
makers were fully conscious that in all similar earlier enactments power to
B grant pardon was specifically conferred by insertion of specific provision to
that effect while passing law establishing Special Court. While enacting the
Act the provision conferring power to grant pardon was deliberately omitted
and this almost conclusively shows that such power was not intended to be
conferred, is the submission of Mr.Jethmalani.
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Reference has been made by learned counsel, in particular, to Section
8 of the Criminal Law (Amendment) Act, 1952 (for short, 'the 1952 Act'). That
Act has since been repealed by the Prevention of Corruption Act, 1988. It
would be convenient to reproduce Section 8. It reads as under:
"8. Procedure and Powers of Special Judges.-( I) A Special Judge may
take cognizances of offence without the accused being committed to
him for trial, and in trying the accused persons, shall follow the
procedure prescribed by the Code of Criminal Procedure, 1898 (5 of
1898) for the trial of warrant cases by Magistrate
(2) A Special Judge may, with a view to obtaining the evidence of any
person supposed to have been directly or indirectly concerned in, or
privy to, an offence, tender a pardon to such person on condition of
his making a full and true disclosure of the whole circumstances
within his knowledge relating to the offence and to every other person
concerned whether as principal or abettor, in the commission thereof;
and any person so tendered shall, for the purposes of Secs. 339 and
339-A of the Code of Criminal Procedure 1898 (5of1898) be deemed
to have been tendered under Section 338 of that Code.
(3) Save as provided in sub-section (I) or sub-section (2), the
provisions of the Code of Criminal Procedure, 1898 (5of1898) shall,
so far as they are not inconsistent with this Act, apply to the
proceedings before a Spei;ial Judge; and for the purposes of the said
provisions, the Court of the Special Judge shall be deemed to be a
Court of Session trying cases without a jury or without the aid of
assessors and the person conducting a prosecution before a Special
Judge shall be deemed to be a public prosecutor.
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HARSHAD S. MEHTA v. STATEOFMAHARASHTRA[Y.K.