SC Upholds FIR in Corruption Case, Clarifies Preliminary Inquiry and Police Powers

Supreme Court allowed the appeal preferred by the State of Karnataka against the order of the High Court of Karnataka which had quashed the FIR registered against the respondent, T.N. Sudhakar Reddy, for offences under the Prevention of Corruption Act, 1988 (PC Act).

Brief of the Case:
The respondent, T.N. Sudhakar Reddy, was working in the Karnataka Power Transmission Corporation Limited (KPTCL) and as Deputy General Manager at BESCOM, Bengaluru, who was accused of holding assets disproportionate to his sources of income, which is amounting to over Rs. 3.81 crore. Based on the disproportionate assest information report submitted by a Police Inspector of the Karnataka Lokayukta, the Superintendent of Police, Karnataka Lokayukta, issued an order directing the Deputy Superintendent of Police to register an FIR against Reddy for offenses under Sections 13(1)(b) and Section 12 read with Section 13(2) of the PC Act and to investigate the same.

Reddy challenged this order and the subsequent FIR before the High Court of Karnataka under Section 482 of the CrPC, seeking their quashing of FIR on the ground that no preliminary inquiry was conducted before its registration and that the Superintendent of Police was not competent to simultaneously direct registration of the FIR and investigation under Section 17 of the PC Act. The High Court of Karnataka allowed the petition and quashed the FIR, leading to the present appeal by the State of Karnataka before the Supreme Court.

The Supreme Court on the ground that no preliminary inquiry was conducted before its registration held that a preliminary inquiry is not mandatory in all cases under the PC Act. While it is desirable in certain categories of cases like corruption, it is not a right of the accused or a mandatory prerequisite for registering a criminal case if the source information itself discloses the commission of a cognizable offense.

The Apex Court observed that in the present case, the source information report presented by the Police Inspector was detailed and elaborate about the so-called disproportionate assets of Reddy, thereforeit is sufficient to have an initial assessment.

The Court also held that the Superintendent of Police has the authority to order the registration of an FIR for cognizable offenses under the PC Act if in possession of reliable information. Additionally, the Court held no fault in the Superintendent of Police issuing a composite order to register the FIR and at the same time authorizing a competent subordinate officer (Deputy Superintendent of Police) to investigate under Section 17 of the PC Act. The Court held that the PC Act depends on the Code of Criminal Procedure, 1973 (CrPC) for the registration of FIRs and that superior police officers are endowed with the same powers as the officers in charge of a police station to command such registration. The Apex Court also makes it clear that the condition under Section 17 of the PC Act is regarding the sanction for inquiry by officers of a particular rank, which can be simultaneously followed with the order of registration of the FIR.

Moreover, the Apex Court differentiated the instant case from Bhajan Lal and observed that the Superintendent of Police in this case had issued a reasoned order after due application of mind on the source information.

Important Observations:

**A preliminary inquiry is not mandatory in every case under the Prevention of Corruption Act, 1988, if the source information is detailed and discloses a prima facie cognizable offense.

**The purpose of a preliminary inquiry is not to verify the truthfulness of the information but only to ascertain whether it reveals a cognizable offense.

**The Superintendent of Police is competent to direct the registration of an FIR for offenses punishable under the PC Act based on credible information.

**Section 17 of the PC Act pertains to the investigation process and does not impede the duty to register an FIR for cognizable offenses.

**A composite order from the Superintendent of Police directing the registration of the FIR and simultaneously authorizing a Deputy Superintendent of Police to investigate the case under Section 17 of the PC Act is valid and compliant with the law.

**The Superintendent of Police's order in this case demonstrated due application of mind and was not a mechanical exercise.

The Supreme Court held that by quashing the FIR, the High Court erred in imposing unwarranted administrative hurdles that could potentially incapacitate law enforcement agencies in corruption cases, consequently the Apex Court set aside the judgment of the High Court of Karnataka which had quashed the FIR registered against the respondent, T.N. Sudhakar Reddy, for offences under the Prevention of Corruption Act, 1988 (PC Act).

Coram: Justice Dipankar Dutta and Justice Sandeep Mehta
Between: STATE OF KARNATAKA VS T.N. SUDHAKAR REDDY 2025 INSC 229
Date of Judgment: 17-02-2025