Skill development scam: SC gives split verdict on Chandrababu Naidu's plea for quashing of FIR

New Delhi: The Supreme Court's two-judge bench on Tuesday delivered a split verdict in a plea filed by former Andhra Pradesh Chief Minister Nara Chandrababu Naidu seeking to quash FIR and criminal proceedings against him in the Skill Development scam case.

A bench of Justices Aniruddha Bose and Bela M Trivedi differed on the interpretation of Section 17A of the Prevention of Corruption (PC) Act which makes prior sanction of government mandatory to prosecute public servant in relation to an act done in discharge of his official functions or duties.

Now the matter will be heard by larger bench.

Justice Bose said, "As we have taken different interpretations on Section 17A, we refer the matter to the Chief Justice of India for appropriate directions."
Both the judges, however, upheld the remand order passed by the Magistrate and the Andhra Pradesh High Court decision to dismiss the plea for quashing the FIR.

The verdict of the top court came on a special leave petition filed by the Naidu against the Andhra Pradesh High Court's order of September 22, 2023, denying him the relief. The apex court had reserved the order on the plea on October 17, 2023.

Justice Aniruddha Bose delivering the verdict held if any inquiry, enquiry and investigation has been initiated without previous approval of the competent authority under Section 17 A, it shall be held illegal. Justice Bose said that authority can now apply sanction.

Section 17A, inserted in July 2018 by way of an amendment, requires the investing agencies to take prior sanction of the competent authorities for the registration of FIR and initiating "inquiry, enquiry or investigation" against a public servant responsible for the decision or recommendation resulting loss to the State exchequer and corruption.

Justice Trivedi, in her judgement held that the amendment Act, 2018 can't be used to seek mandatory approval of the authorities for the offences prior to the date of July 26, 2018 notified for application of the new provisions.
The amendment Act, 2018 would be applied prospectively, not to offences which occured before the date of notification, Justice Trivedi said.

Justice Trivedi added, "Lack of approval of Section 17A cannot be a ground to quash the FIR especially when offences under IPC are also registered."
Naidu had approached the top court seeking quashing of FIR and cited Section 17A of the Prevention of Corruption Act, 1988, to challenge his arrest by the Andhra Pradesh police's CID in skill development scam. He had challenged the High Court judgment rejecting his plea for the quashing of FIR. Naidu was granted regular bail in November, last year.
Naidu had sought quashing of FIR registered by AP-CID in the alleged Rs 371 crore skill development scam on the ground that the police did not obtain prior sanction from the Governor as mandated under PC Act.

Andhra Pradesh government had objected to Naidu's plea saying Section 17A of the PC Act can't parachute in the cases of alleged corruption leading to loss to the State exchequer that happened before its insertion in the Act on July 26, 2018.
Senior advocate Mukul Rohatgi, appearing for Andhra Pradesh, had told the top court that no prior sanction of the State Governor was required for registering FIR and the consequent investigation against former Chief Minister Naidu for alleged corruption and loss to the State in his skill development project during 2014-2016.

In his plea, Naidu contended that Andhra Pradesh High Court had rejected his petition by ignoring his pleading that under Section 17A of the PC Act, which came into force from July 26, 2018, no FIR against a public servant could be registered without prior sanction of the appropriate authority.
The FIR against Naidu was registered on December 9, 2021, and he was added as accused number 37 in the case on September 7, 2023. Section 17A of PC Act was not complied with as "no permission was obtained from the competent authority", the plea stated.
As Naidu was the Chief Minister at the time of the commission of the alleged offence relating to the skill development scam, the competent authority would have been the Governor of the State.

Naidu, presently the Leader of Opposition, the national president of the Telugu Desam Party (TDP), called the action against him as "an orchestrated campaign of regime revenge and to derail the largest opposition, the Telugu Desam Party".
"The extent of the political vendetta, is further demonstrated from the belated application for grant of police custody on September 11, 2023, which names the political opponent i.e. the TDP and also the petitioner's family, which is being targeted to crush all opposition to the party in power in the State with elections coming near in 2024," the plea added.

This motivated campaign of harassment has been allowed to continue by the Courts unabated despite patent illegality in the FIR, the appeal stated.
Naidu had also challenged the Andhra Pradesh High Court order denying him anticipatory bail in the FiberNet scam case.