One of the cardinal principles of the Constitution is that a person should not be prosecuted a second time once he is convicted or acquitted for the same offence. However, when it is applied to specific instances with overlapping facts, civil liberty questions arise which divide society and even the judges. High-profile trials and movies have highlighted this issue. Last week, the Supreme Court judges were split on this question in a case of foreign exchange violation. Last month, in a cheque bouncing case, they faced the same dilemma.
In the foreign exchange case, Radheshyam Kejriwal vs State of West Bengal, the majority and minority judges made strong arguments for their contrary viewpoints, often citing the same Constitution bench precedents. In the event, the majority ruled that the accused person could not be tried twice on the same facts.
Several economic laws, like the Income Tax Act and the Customs Act, provide for two stages of proceedings in cases where regulations are violated. The first one is akin to adjudication by a special officer of the department concerned. The offence can also be filed as a regular case in a criminal court. In this case, the adjudicating authority categorically held that the charges against the accused person could not be sustained. The authorities did not leave it at that. They pursued the matter before a criminal court. He challenged the prosecution before the magistrate. But the Calcutta High Court rejected his petition and asked him to stand trial. He appealed to the Supreme Court and succeeded in quashing the trial.
The judges could not agree whether the first proceeding could be called prosecution. If it is prosecution, then the second one would amount to re-prosecution, with the prospect of multiple trial punishment. The majority judges ruled that “it would be unjust and an abuse of process of the court to permit the Enforcement Directorate to continue with the criminal prosecution”. They laid down a yardstick in such cases: if the allegations in both proceedings are identical and the accused is exonerated on merits on the same set of facts in one proceeding, he cannot be asked to stand a second trial.
The dissenting judge emphasised that in a law relating to economic offences the provisions should be read liberally to avoid revenue loss to the government. In this case under the (now repealed) Foreign Exchange Regulation Act, the two proceedings are independent of each other. The legislative intention was to augment the revenue and develop the economy. Interpreting the provisions in that light, the criminal case can be sustained because the adjudication by the authorities and the criminal prosecution were “distinct and separate”.
In the second case, which raised a similar issue, the Supreme Court ruled that a person who was convicted for issuing a cheque that was dishonoured for want of sufficient balance could not be prosecuted again on the charge of cheating regarding the same cheque. He was convicted under Section 138 of the Negotiable Instruments Act. Then he was tried to be prosecuted for cheating under Section 420 of the Indian Penal Code. In this case, Kolla Veera vs Gorantla Rao, the convict argued that he was found guilty in the first case, so he could not be punished a second time for issuing the cheque as a case of cheating. Accepting his contention, the court stated that under Section 300 (1) of the Criminal Procedure Code, no one can be tried and convicted for the same offence or even a different offence on the same facts. Article 20 of the Constitution also protects such an offender from “double jeopardy”. The Andhra Pradesh High Court judgment to the contrary was set aside.
Protection from double jeopardy is as ancient as the Greek and Roman jurisprudence. Demosthenes declared that law forbid the same person to be tried twice on the same issue. The Romans codified the concept in the Digest of Justinian. The Fifth Amendment to the US Constitution and Article 20 of the Indian Constitution sanctify the doctrine. There are strong reasons for doing so. It prevents the government from exercising its power to wear down and convict innocent people. Citizens are protected from the financial, emotional and social consequences of successive prosecutions. The principle also gives finality to criminal proceedings.
The clarification of the court on the double trouble facing people accused of economic offences is timely and significant — the Law Commission, in its 47th report, had recommended that “in more and more cases, prosecution should also be launched apart from adjudication so as to have a deterrent effect”. Moreover, recent Supreme Court cases have shown that the amounts of foreign exchange sunk in tax havens are as unreadable as the Union Budget figures.