OFFICE OF THE ODISHA LOKAYUKTAversusDR. PRADEEP KUMAR PANIGRAHI AND OTHERS

560                       [2023]
               SUPREME COURT     2 S.C.R. 560
                              REPORTS                         [2023] 2 S.C.R.


A                  OFFICE OF THE ODISHA LOKAYUKTA
                                         v.
            DR. PRADEEP KUMAR PANIGRAHI AND OTHERS
                       (Civil Appeal No(s).1384-85 of 2023)
B                             FEBRUARY 23, 2023
              [AJAY RASTOGI AND BELA M. TRIVEDI, JJ.]
             Odisha Lokayukta Act, 2014 – s.20(1), 25, 28 – Order passed
      by the appellant, in exercise of power conferred u/s.20(1), directing
      to conduct preliminary inquiry against respondent no.1 – Set aside
C
      by High Court –Held: High Court passed the impugned order setting
      aside the order of the appellantwithout affording it an opportunity
      of hearing and thus, is in violation of the principles of natural justice
      – Even on merits, High Court completely overlooked s.20(1) that
      empowers the Lokayukta, on receipt of a complaint, in its discretion
D     if intended to proceed and to hold any inquiry, can conduct
      preliminary inquiry against a public servant by its wing or any other
      agency – So far as the term ‘any agency’ is concerned, it clearly
      manifests from s.25 which entrusts the power of superintendence to
      the Lokayukta to exercise in such a manner so as to require any
      agency, including the State Vigilance and Crime Branch – Also, u/
E
      s.28 for the purpose of conducting any preliminary inquiry or
      investigation, it is open for the Lokayukta to utilize the services of
      any officer or organization or investigation agency of the
      Government – Thus, in the present case, if the appellant conducted
      a preliminary inquiry through an agency of the Government of which
F     reference has been made u/s.28 through the Directorate of Vigilance,
      Cuttack, there is no legal infirmity committed by the appellant –
      Decision-making process in conducting the preliminary inquiry was
      within the scope and ambit of s.20(1)–Judgment of High Court and
      the review order are set aside.
G           Administrative Law– Rule against Bias – Held: Rule against
      bias ensures a fair procedure by excluding decision makers who
      are tainted by bias – Under the rule, actual bias is disqualifying
      even though it is prohibitively difficult to establish – Justice must
      not only be done but must also appear to be done – In the present
      case, the Officer who submitted the complaint was simply an
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                                        560
   OFFICE OF THE ODISHA LOKAYUKTA v. DR. PRADEEP                         561
                 KUMAR PANIGRAHI

informant and not the person interested, at the same time, preliminary   A
enquiry was conducted by a different officer not connected with
author of the complaint – Thus, the plea of bias is ill-founded –
Odisha Lokayukta Act, 2014.
      Allowing the appeals, the Court
       HELD: 1.1 The aim to the rule of natural justice is to secure     B
justice or to put it negatively, these rules can operate only in
areas not covered by any law validly made. Before any action
could have been taken by the Directorate of Vigilance in
conducting a preliminary enquiry, a writ petition was filed by
respondent no.1 before the High Court and on the first motion            C
stage, the High Court, without affording an opportunity of hearing
to the appellant, set aside the order dated 11th December, 2020
passed by the appellant for conducting a preliminary inquiry. The
Division Bench of the High Court has committed a manifest error
in passing of the order impugned while setting aside the order of
the appellant dated 11th December, 2020 to conduct a preliminary         D
inquiry against respondent no.1 in exercise of powers under
Section 20(1) of the Act, 2014 which is in violation of the principles
of natural justice. [Paras 25, 26, 27][572-F-H; 573-B-C]
       1.2 Even on merits, the Division Bench has completely
overlooked Section 20(1) of the Act, 2014 that empowers the              E
Lokayukta, on receipt of a complaint, obviously after recording
satisfaction, in its discretion if intended to proceed and to hold
any inquiry, can conduct either a preliminary inquiry against a
public servant by its inquiry wing or any other agency to ascertain
whether there exists a prima facie case for proceeding in the            F
matter or hold investigation by any agency or authority
empowered under any law to investigate whether there exists a
prima facie case. So far as the term ‘any agency’ is concerned, it
clearly manifests from Section 25 of Chapter VIII which entrusts
the power of superintendence to the Lokayukta to exercise in
such a manner so as to require any agency, including the State           G
Vigilance and Crime Branch. [Paras 28, 29][573-D-E]
     1.3 At the same time, under Section 28, for the purpose of
conducting any preliminary inquiry or investigation, it is open for

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562            SUPREME COURT REPORTS                      [2023] 2 S.C.R.


A     the Lokayukta to utilize the services of any officer or organization
      or investigation agency of the Government and, in the
      circumstances, if the appellant in its judicious discretion and on
      the facts and circumstances of the case, conduct a preliminary
      inquiry through an agency of the Government of which reference
      has been made under Section 28 through the Directorate of
B
      Vigilance, Cuttack, there appears no legal infirmity being
      committed by the appellant in the decision-making process in
      conducting a preliminary inquiry whichwas within the scope and
      ambit of Section 20(1) of the Act, 2014 and a manifest error was
      committed by the Division Bench of the High Court while setting
C     aside the order of the appellant dated 11th December, 2020 to
      conduct an inquiry against respondent no.1. [Para 30][573-F-H;
      574-A]
            1.4 Although this Court may not appreciate the action of
      the appellant in taking further steps when there was stay of the
D     order impugned passed by this Court, but at the same time, an
      opportunity was granted to the respondents as well to justify if
      the action taken by the appellant is not in conformity with the
      mandate of the Act, 2014, but from the written submissions placed
      before this Court, no valid objection was found to have been
      raised by the respondents which may call upon this Court to
E     interfere in furtherance of the action being taken by the appellant
      after the preliminary inquiry report was submitted pursuant to
      order dated 11th December, 2020.[Para 33][574-D-F]
             1.5 The rule against bias is an essential component of
      modern administrative law. The rule against bias ensures a fair
F     procedure by excluding decision-makers who are tainted by bias.
      Under the rule, actual bias is disqualifying even though it is
      prohibitively difficult to establish. The basic principle underlying
      the time-tested rule is that justice must not only be done but
      must also appears to be done. In the instant case, the complaint
G     was made by the Deputy Superintendent of Police of the
      Directorate of Vigilance, who is, directly or indirectly, not
      concerned with the complaint, he can be said to be an informant
      to the office of the appellant and that apart, a preliminary inquiry
      was conducted independently by a senior officer of the Directorate
      of Vigilance, Additional Superintendent of Police who submitted
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   OFFICE OF THE ODISHA LOKAYUKTA v. DR. PRADEEP                        563
                 KUMAR PANIGRAHI

his report of the preliminary inquiry. The question of bias in the      A
instant facts and circumstances does not arise at all. Further, if
the order of the appellant directing the Directorate of Vigilance
to conduct the preliminary inquiry in exercise of power under
Section 20(1) of the Act, 2014 has been set aside by the High
Court, obviously,the appellant is a person aggrieved and can
certainly question the legality/validity of the judgment of the High    B
Court impugned by invoking jurisdiction of this Court under
Article 136 of the Constitution.The judgment of the High Court
and the review order are set aside.[Paras 35, 37, 42 and 43][575-
C; 578-D-F; 581-B-D]
      Ashok Kumar Yadav and others vs. State of Haryana                 C
      and others 1985 (4) SCC 417 : [1985] 1 Suppl. SCR
      657; Mukesh Singh vs. State (Narcotic Branch of Delhi)
      2020 (10) SCC 120 : [2020] 9 SCR 245– followed.
      National Commission for Women vs. State of Delhi and
      another 2010 (12) SCC 599 : [2010] 10 SCR 905; M.S.               D
      Kazi vs. Muslim Education Society and others 2016 (9)
      SCC 263 : [2016] 4 SCR 80 – held inapplicable.
      A.K. Kraipak and others vs. Union of India and others
      1969 (2) SCC 262 : [1970] 1 SCR 457 – relied on.
                       Case Law Reference                               E
[1970] 1 SCR 457                relied on              Para 35
[1985] 1 Suppl. SCR 657         followed               Para 36
[2020] 9 SCR 245                followed               Para 37
[2010] 10 SCR 905               held inapplicable      Para 38          F

[2016] 4 SCR 80                 held inapplicable      Para 38
      CIVIL APPELLATE JURISDICTION : Civil Appeal Nos.1384-
1385 of 2023.
      From the Judgment and Order dated 03.02.2021 of the High Court    G
of Orissa at Cuttack in WP (C) No.3488 of 2021 and dated 05.04.2021
in RVWPET No.45 of 2021.
      Ravindra Shrivastav, Sr. Adv., Arjun Garg, Aakash Nandolia, Ms.
Sagun Srivastava, Ms. Sanya Shukla, Devangna Singh, Advs. for the
Appellant.                                                              H
564            SUPREME COURT REPORTS                           [2023] 2 S.C.R.


A           Pitamber Acharya, Sr. Adv., Apoorve Karol, Lakshay Sharma,
      Mithu Jain, Shibashish Misra, Advs. for the Respondents.
            The Judgment of the Court was delivered by
            RASTOGI, J.
B           1. Leave granted.
              2. The instant appeals are directed against the judgment dated 3rd
      February, 2021 passed by the Division Bench of the High Court of Orissa
      at Cuttack setting aside Order dated 11th December, 2020 passed by the
      Odisha Lokayukta initiating to conduct a preliminary inquiry in exercise
C     of power conferred under Section 20(1) of the Odisha Lokayukta Act,
      2014 (hereinafter being referred to as the “Act 2014”) on a complaint
      dated 9th December, 2020 received from Mr. Ranjan Kumar Das, Deputy
      Superintendent of Police, Vigilance Cell Unit, Bhubaneswar indicating
      the alleged corruption against respondent no. 1 who is the elected Member
      of the Legislative Assembly of Gopalpur Constituency directing the
D     Directorate of Vigilance, Cuttack to conduct a preliminary inquiry and
      submit a report to the Lokayukta.
             3. The review petition filed at the instance of the appellant on the
      premise that Odisha Lokayukta was never heard and no opportunity of
      hearing has been afforded before passing of the impugned Order dated
E     3rd February, 2021 and it was in violation of the principles of natural
      justice, came to be dismissed by passing a non-speaking Order dated 5th
      April, 2021.
             4. Respondent no. 1 is an elected Member of the Legislative
      Assembly. Mr. Ranjan Kumar Das, the then Deputy Superintendent of
F     Police, Vigilance Cell Unit, Bhubaneswar, made a complaint dated 9th
      December, 2020 indicating serious allegations of alleged corruption against
      Member of the Odisha Legislative Assembly of Gopalpur Constituency.
      Along with the complaint, supporting documents were also annexed.
      The Odisha Lokayukta, after taking into consideration the contents of
      the complaint and the supporting documents annexed thereto, in exercise
G
      of power conferred under Section 20(1) of the Act, 2014 directed the
      Directorate of Vigilance, Odisha, Cuttack to conduct a preliminary inquiry
      against respondent no. 1 and submit a report within two months with a
      further direction that the Directorate of Vigilance must ensure that during
      preliminary inquiry, the mandate of Section 20(2) has to be complied
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   OFFICE OF THE ODISHA LOKAYUKTA v. DR. PRADEEP                                  565
         KUMAR PANIGRAHI [AJAY RASTOGI, J.]

with and further directed the Office of Lokayukta to make available all           A
the relevant record to the Directorate of Vigilance for compliance.
       5. Immediately on a reference made by the Odisha Lokayukta by
its Order dated 11th December, 2020 directing the Directorate of Vigilance
to conduct a preliminary inquiry against respondent no. 1 and calling
upon the report, came to be challenged by respondent no. 1 by filing writ         B
petition before the High Court under Article 226 of the Constitution.
Although the Office of Lokayukta was impleaded as one of respondent
before the High Court but as informed to this Court, no notice was issued
to them and on the first date of hearing, without even affording opportunity
of hearing to the appellant to submit their written response, the Division
Bench of the High Court under Order dated 3rd February, 2021 proceeded            C
on the premise that entrusting Directorate of Vigilance to conduct
preliminary inquiry is not in terms of the mandate of Section 20(1) and
set aside the Order dated 11th December, 2020 with a liberty to the
Lokayukta to conduct preliminary inquiry, if so advised, against
respondent no. 1 by the inquiry wing of the Lokayukta with a further              D
liberty to proceed in conformity with the requirements of Sections 20(2)
and 20(3) after the preliminary report being furnished by the inquiry
wing of the Lokayukta.
      6. A review filed by the Lokayukta against the Order impugned
dated 3rd February, 2021 came to be dismissed by a non-speaking order             E
dated 5th April, 2021 which is a subject matter of challenge in the appeals
before us.
       7. Learned counsel for the appellant submits that the order
impugned dated 3rd February, 2021 is in violation of the principles of
nature justice and the finding has been recorded without affording an             F
opportunity of hearing to the appellant and that apart, it is not in conformity
with the mandate of Section 20(1) of the Act 2014.
       8. Learned counsel further submits that Section 20(1) provides an
option to the Lokayukta, who, on receipt of a complaint, if order to hold
a preliminary inquiry against any public servant, may conduct either by           G
its enquiry wing or by any agency to ascertain as to whether there exists
any prima facie case for proceeding in the matter any further. If the
relevant provisions of the Act are being looked into, particularly Chapter
VIII of the Act 2014, any agency as referred to under Section 25 includes
the State Vigilance and Crime Branch for the purpose of conducting
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566             SUPREME COURT REPORTS                            [2023] 2 S.C.R.


A     preliminary inquiry or investigation, as the case may be, and that is further
      strengthened by the procedure for conducting a preliminary inquiry or
      investigation envisaged under Section 28 wherein it is open for the
      Lokayukta to conduct preliminary inquiry or investigation through the
      agency of the Government. In the given facts and circumstances, the
      finding which has been recorded by the Division Bench of the High
B
      Court that entrusting to conduct preliminary inquiry by the Directorate
      of Vigilance under Order dated 11th December, 2020 is not in conformity
      with the Act 2014, needs to be interfered with by this Court.
              9. Learned counsel further submits that calling upon the inquiry
      wing or any agency to conduct a preliminary inquiry is only for a limited
C     purpose to ascertain whether there exists prima facie case to proceed in
      the matter. The Legislature was conscious of the fact that if it may
      cause any prejudice to the incumbent against whom the prima facie
      case has been registered and before any further action is being taken or
      to make any recommendation to proceed either to conduct investigation
D     or initiate a departmental inquiry, it is incumbent upon the Lokayukta to
      afford an opportunity of hearing to the public servant as referred to
      under Sections 20(2) and 20(3) of the Act, 2014. A complete inbuilt
      procedure has been prescribed under Chapter VII for conducting
      preliminary inquiry and investigation within the powers of the Lokayukta.
      Chapter VIII prescribes not only the purpose of conducting preliminary
E     inquiry and investigation but also in reaching to a final conclusion even at
      the stage of registering of the charge-sheet as referred to under Section
      20(8) of the Act, 2014.
            10. Learned counsel further submits that no adverse or prejudicial
      action was taken by the appellant in initiating to conduct a preliminary
F     inquiry under its Order dated 11th December 2020, thus the interference
      made by the High Court, at this stage, in exercise of its jurisdiction under
      Article 226 of the Constitution of India was neither valid nor justified.
             11. Per contra, learned counsel for the respondents, on the other
      hand, submits that a complaint was made by the Deputy Superintendent
G     of Police, Vigilance Cell, Bhubaneshwar dated 9 th December, 2020, who
      was the Officer of Directorate of Vigilance, Cuttack, Odisha, Cuttack
      and direction was given to the Directorate of Vigilance, Odisha to conduct
      a preliminary inquiry by Order dated 11th December, 2020, the decision
      itself was in violation of the principles of natural justice. Once the
H     complaint was made by the officer of the Directorate of Vigilance, at
   OFFICE OF THE ODISHA LOKAYUKTA v. DR. PRADEEP                               567
         KUMAR PANIGRAHI [AJAY RASTOGI, J.]

least entrusting the preliminary inquiry to be conducted by another Officer    A
of the Directorate of Vigilance, may be senior in the ladder, was not
legally justified. The Officer of the Department has made a complaint
on 9th December, 2020 and other officer is called upon to conduct a
preliminary inquiry as stated that one cannot be a judge in its own cause
and that being the reason, the Division Bench of the High Court has
                                                                               B
permitted the Lokayukta to conduct an inquiry by the inquiry wing of the
Lokayukta and administrative bias can’t be ruled out of the Directorate
of Vigilance who is to conduct a preliminary inquiry.
      12. Learned counsel further submits that since the respondents
were duly represented and the Advocate General of the State appeared
along with the State counsel, opportunity of hearing was afforded to the       C
appellant and plea of the principles of natural justice as prayed for by the
appellant being violated, in the facts and circumstances, does not hold
good. That apart, review petition came to be rightly dismissed as the
appellant failed to justify any manifest error being committed by the
Division Bench of the High Court under its Order dated 3rd February,           D
2021 which may call for our interference.
        13. It may be noticed that while issuing notice by this Court on
23 rd April, 2021, operation of the impugned order was stayed. In
furtherance of the stay granted by this Court, it is informed that the
appellant has proceeded further and after the preliminary inquiry report       E
being submitted to the Lokayukta by the Officer Shri P.K. Naik on 28th
May, 2021 and after affording opportunity of hearing to the appellant, a
detailed Order was passed by the Lokayukta under Section 20(3)(a)
dated 27th September, 2021 directing the Directorate of Vigilance to
carry out investigation. In furtherance thereof, Directorate of Vigilance
submitted a detailed report of investigation to the Lokayukta on 7 th June,    F
2022, however, no further action has been initiated and awaiting orders
of this Court which is indicated in the order dated 24 th June, 2022 placed
on record along with IA No. 89629 of 2022.
       14. We have heard learned counsel for the parties and with their
assistance perused the material available on record.                           G
       15. Before we proceed to examine the question raised in the instant
appeals, it may be apposite to first take a bird’s eye view of the Scheme
of the Act, 2014.

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568            SUPREME COURT REPORTS                           [2023] 2 S.C.R.


A            16. The Act, 2014 has been enacted by the legislature of the State
      of Odisha having been assented to by the President on the 16th January,
      2015 with an object to provide for the establishment of the body of
      Lokayukta for the State of Odisha to inquire into allegations of corruption
      against public functionaries and for matters connected therewith or
      incidental thereto. The Act is applicable to the public servants of the
B
      State of Odisha serving in and outside the State and the public servants
      under the control of Government of Odisha.
            17. A ‘complaint’ has been defined under Section 2(d), and the
      term ‘preliminary inquiry’ and ‘public servant’ under Sections 2(l) and
      2(n) of the Act 2014 which are stated as follows:-
C
            “2. (1) In this Act, unless the context otherwise requires,—
            ……
            (d) “complaint” means a complaint, made in such form as may be
            prescribed, alleging that a public servant has committed an offence
D           punishable under the Prevention of Corruption Act,1988;
            ……
            (l) “preliminary inquiry” means an inquiry conducted under this
            Act;
E           ……
            (n) “public servant” means a person referred to in clauses (a) to
            (h) of sub-section (1) of section 14 but does not include a public
            servant in respect of whom the jurisdiction is exercisable by any
            court or other authority under the Army Act, 1950, the Air Force
F           Act, 1950, the Navy Act, 1957 and the Coast Guard Act, 1978 or
            the procedure is applicable to such public servant under those
            Acts;
            …….”.
            18. Chapter VII prescribes the procedure in respect of preliminary
G     inquiry and investigation, the relevant part of which is reproduced as
      under:-
            “20. (1) The Lokayukta, on receipt of a complaint, if it decides to
            proceed further, may order—

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OFFICE OF THE ODISHA LOKAYUKTA v. DR. PRADEEP                             569
      KUMAR PANIGRAHI [AJAY RASTOGI, J.]

      (a) preliminary inquiry against any public servant by its Inquiry   A
      Wing or any agency to ascertain whether there exists a prima
      facie case for proceeding in the matter; or
      (b) investigation by any agency or authority empowered under
      any law to investigate, where there exists a prima facie case:
         Provided that any investigation under this clause shall be       B
  ordered only if in the opinion of the Lokayukta there is substantial
  material relating to the existence of a prima facie case or any
  earlier statutory investigation or enquiry regarding the same
  complaint reveals that a prima facie case exists:
         Provided further that before ordering an investigation under     C
  this clause, the Lokayukta shall call for the explanation of the
  public servant and views of the competent authority, so as to
  determine whether there exists a prima facie case for investigation:
          Provided also that a decision to order investigation under
  this clause shall be taken by a bench constituted by the Chairperson    D
  under section 16.
  (2) During the preliminary inquiry referred to in sub-section (1),
  the Inquiry Wing or any agency shall conduct a preliminary inquiry
  and on the basis of material, information and documents collected,
  seek the comments on the allegations made in the complaint from         E
  the public servant and competent authority and after obtaining the
  comments of the concerned public servant and competent authority,
  submit, within sixty days from the date of receipt of the reference,
  a report to the Lokayukta.
  (3) A bench consisting of not less than three Members of the            F
  Lokayukta shall consider every report received under sub-section
  (2) from the Inquiry Wing or any agency and after giving an
  opportunity of being heard to the public servant, decide as to
  whether there exists a prima facie case, and make
  recommendations to proceed with one or more of the following
                                                                          G
  actions, namely:
  —
      (a) investigation by any agency (including any special
      investigation agency);
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570      SUPREME COURT REPORTS                            [2023] 2 S.C.R.


A        (b) initiation of the departmental proceedings or any other
         appropriate action against the concerned public servant by the
         competent authority;
         (c) closure of the proceedings against the public servant and
         take action to proceed against the complainant under section
B        46.
      (4) The promotion and other service benefits of a public servant
      mentioned in clauses (e) to (h) of sub-section (1) of section 14
      shall not be affected until the public servant is put under suspension
      on recommendation of the Lokayukta under section 32 or charge
C     sheet is filed after completion of investigation under clause (a) of
      sub-section (3) or a charge memo is issued against the said public
      servant in a disciplinary proceeding initiated on the recommendation
      of the Lokayukta under clause (b) of sub-section (3).
      (5) Every preliminary inquiry referred to in sub-section (1) shall
D     ordinarily be completed within a period of ninety days and for
      reasons to be recorded in writing, within a further period of ninety
      days from the date of receipt of the complaint.
      (6) In case the Lokayukta decides to proceed to investigate into
      the complaint, it shall, by order in writing, direct any investigating
E     agency (including any special agency) to carry out the investigation
      as expeditiously as possible and complete the investigation within
      a period of six months from the date of its order:
      Provided that the Lokayukta, for the reasons to be recorded in
      writing, may extend the said period by a further period not exceeding
F     six months at a time and for the maximum period of two years.
      (7) Notwithstanding anything contained in section 173 of the Code
      of Criminal Procedure, 1973, any investigating agency (including
      any special agency) shall, in respect of cases referred to it by the
      Lokayukta, submit the investigation report to the Lokayukta.
G     (8) A bench consisting of not less than three Members of the
      Lokayukta shall consider every report received by it under
      sub-section (7) from any investigating agency (including any special
      agency) and may, decide as to—
         (a) filing of charge-sheet or closure report before the Special
H        Court against the public servant;
   OFFICE OF THE ODISHA LOKAYUKTA v. DR. PRADEEP                                 571
         KUMAR PANIGRAHI [AJAY RASTOGI, J.]

          (b) initiating the departmental proceedings or any other               A
          appropriate action against the concerned public servant by the
          competent authority.
       (9) The Lokayukta may, after taking a decision under sub-section
       (8) on the filing of the charge sheet, direct its Prosecution Wing to
       initiate prosecution in a Special Court in respect of cases               B
       investigated by any investigating agency (including any special
       agency).
       …..”
       19. Section 20 provides an inbuilt mechanism laying down the
procedure to be followed in holding preliminary inquiry and investigation        C
which the Lokayukta, in the facts and circumstances, on receipt of a
complaint may decide - either order for conducting preliminary inquiry
against the public servant by its inquiry wing or any agency to ascertain
whether there exists a prima facie case for proceeding in the matter; or
direct to hold an investigation by any agency or authority empowered             D
under any law to investigate, to record its satisfaction whether there
exists a prima facie case.
        20. Sub-sections (2), (3) and (4) provide the procedure which has
to be followed by the inquiry wing or any agency which has been asked
to ascertain the fact as to whether there exists prima facie case for            E
proceeding in the matter. Such report is placed before a Bench consisting
of not less than three members of the Lokayukta to consider the same
under sub-section (2) from the inquiry wing or any agency and after
affording an opportunity of being heard to the public servant, may
recommend to proceed with one or more of the actions as provided
under Clauses (a), (b) or (c) of sub-section (3) to hold departmental            F
action against the public servant. Sub-section (5) prescribes the time
schedule of 90 days under which preliminary inquiry has to be concluded.
Sub-section (6) provides the action to be taken to carry out the
investigation as expeditiously as possible and complete the investigation
within a period of six months. Under sub-section (7), notwithstanding            G
anything contained in Section 173 of the Code of Criminal Procedure,
1973, the investigating agency may submit the investigation report to the
Lokayukta. Sub-sections (8) and (9) provide the procedure to be followed
after investigating agency has submitted its report for taking further action.

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572             SUPREME COURT REPORTS                            [2023] 2 S.C.R.


A             21. Chapter VIII provides the power of the Lokayukta. Under
      Section 25, the power of superintendence and direction over the
      investigating agency including the State Vigilance and Crime Branch in
      respect of the matters in so far as they relate to the investigation made
      by such agency has been entrusted to Lokayukta.
B             22. Section 27 clarifies that for the purpose of any preliminary
      inquiry, the inquiry wing of the Lokayukta holds powers of a civil Court,
      under the Code of Civil Procedure, 1908 and any proceedings before
      the Lokayukta shall be deemed to be a judicial proceeding within the
      meaning of Section 193 of the Indian Penal Code, 1860.
              23. Section 28 authorise the Lokayukta to conduct any preliminary
C     inquiry or investigation and utilize the services of any officer or
      organization or investigation agency of the Government.
              24. The Act, in fact, is a complete code putting in place the
      procedure under which the Lokayukta under the Act, 2014 within its
      territorial jurisdiction holds the authority to adopt a mechanism in reference
D     to public servants of the State of Odisha serving in and outside the State
      and the public servants under the control of Government of Odisha to
      inquire into allegations of corruption against the public functionaries and
      for matters connected therewith or incidental thereto.
              25. Mr. Ranjan Kumar Das, Deputy Superintendent of Police,
E     Vigilance Cell Unit, Bhubaneswar was not a person interested but as an
      informant submitted a complaint against respondent no. 1 (MLA Gopalpur
      Constituency) to Odisha Lokayukta regarding possession of
      disproportionate assets and intentionally enriching himself illicitly adopting
      mal-practices. On the said complaint being received, the appellant
      directed the Directorate of Vigilance, Cuttack to conduct a preliminary
F     inquiry against respondent no.1 in exercise of his power under Section
      20(1) of the Act, 2014 by an order dated 11th December, 2020. Before
      any action could have been taken by the Directorate of Vigilance in
      conducting a preliminary inquiry, a writ petition was filed by respondent
      no.1 before the High Court and on the first motion stage, the High Court,
G     without affording an opportunity of hearing to the appellant, set aside the
      order dated 11th December, 2020 passed by the appellant for conducting
      a preliminary inquiry. The action of the Division Bench of the High Court
      indeed was in violation of the principles of natural justice.
              26. The aim to the rule of natural justice is to secure justice or to
      put it negatively, these rules can operate only in areas not covered by
H
   OFFICE OF THE ODISHA LOKAYUKTA v. DR. PRADEEP                               573
         KUMAR PANIGRAHI [AJAY RASTOGI, J.]

any law validly made. The concept of natural justice, indeed, has              A
undergone a change with the passage of time, but still the time- tested
rules, namely, are (i) no one shall be a judge in his own case (Nemo
debet essse judex propria causa) and (ii) no decision shall be given
against a party without affording him a reasonable opportunity of hearing
(audi alteram partem). At the same time, action of the authority must
                                                                               B
be held in good faith without bias and not arbitrary or unreasonable.
       27. In the first instance, the Division Bench of the High Court has
committed a manifest error in passing of the order impugned dated 3 rd
February, 2021 while setting aside the order of the appellant dated 11th
December, 2020 to conduct a preliminary inquiry against respondent
no.1 in exercise of powers under Section 20(1) of the Act, 2014 which is       C
in violation of the principles of natural justice.
       28. Even on merits, the Division Bench has completely overlooked
Section 20(1) of the Act, 2014 that empowers the Lokayukta, on receipt
of a complaint, obviously after recording satisfaction, in its discretion if
intended to proceed and to hold any inquiry, can conduct either a              D
preliminary inquiry against a public servant by its inquiry wing or any
other agency to ascertain whether there exists a prima facie case for
proceeding in the matter or hold investigation by any agency or authority
empowered under any law to investigate whether there exists a prima
facie case.                                                                    E
      29. So far as the term ‘any agency’ is concerned, it clearly
manifests from Section 25 of Chapter VIII which entrusts the power of
superintendence to the Lokayukta to exercise in such a manner so as to
require any agency, including the State Vigilance and Crime Branch.
       30. At the same time, under Section 28, for the purpose of              F
conducting any preliminary inquiry or investigation, it is open for the
Lokayukta to utilize the services of any officer or organization or
investigation agency of the Government and, in the circumstances, if the
appellant in its judicious discretion and on the facts and circumstances
of the case, conduct a preliminary inquiry through an agency of the
                                                                               G
Government of which reference has been made under Section 28 through
the Directorate of Vigilance, Cuttack, there appears no legal infirmity
being committed by the appellant in the decision-making process in
conducting a preliminary inquiry which, in our view, was within the scope
and ambit of Section 20(1) of the Act, 2014 and a manifest error was
committed by the Division Bench of the High Court while setting aside          H
574             SUPREME COURT REPORTS                            [2023] 2 S.C.R.


A     the order of the appellant dated 11th December, 2020 to conduct an
      inquiry against respondent no.1.
              31. It is not a case of the respondents that respondent no.1 is not
      a public servant or the Act, 2014 is not applicable to him or the Lokayukta
      in its jurisdiction was not competent to conduct a preliminary inquiry
B     under Section 20(1) of the Act, 2014. In the given facts and
      circumstances, the finding returned by the Division Bench of the High
      Court under the judgment impugned, in our view, is not legally sustainable.
             32. During the course of submissions made by the parties, it was
      informed that after the stay was granted by this Court of the judgment
C     impugned dated 3rd February, 2021, the appellant has proceeded in
      conducting further inquiry and actions are being taken after the Directorate
      of Vigilance has submitted a preliminary inquiry report to the Lokayukta
      under Section 20(3)(a) to carry out investigation and steps are taken by
      the Directorate of Vigilance in summitting a report of investigation before
      the appellant on 7th June, 2022.
D
             33. Although we may not appreciate the action of the appellant in
      taking further steps when there was stay of the order impugned passed
      by this Court, but at the same time, we granted an opportunity to the
      respondents as well to justify if the action taken by the appellant is not in
      conformity with the mandate of the Act, 2014, but from the written
E     submissions placed before us, we do not find any valid objection being
      raised by the respondents which may call upon this Court to interfere in
      furtherance of the action being taken by the appellant after the preliminary
      inquiry report was submitted pursuant to order dated 11th December,
      2020. Still we leave it open to respondent no.1, if further action taken by
F     the appellant is not in conformity with law, he is at liberty to initiate
      proceedings as admissible to him under the law.
             34. So far as the objection raised by the respondents regarding
      the action of conducting preliminary inquiry being bias for the reason
      that the Deputy Superintendent of Police of the Directorate of Vigilance
G     has submitted a complaint and the appellant directed the Directorate of
      Vigilance to conduct a preliminary inquiry by an order dated 11 th
      December, 2020, which, in fact, was conducted by a senior officer of
      the Directorate of Vigliance i.e. Additional Superintendent of Police
      Vigilance, Mr. P.K. Naik, who submitted a report to the appellant on 28 th
      May, 2021 is concerned, we are not persuaded with the submission of
H
      OFFICE OF THE ODISHA LOKAYUKTA v. DR. PRADEEP                             575
            KUMAR PANIGRAHI [AJAY RASTOGI, J.]

there being any bias on the part of the Directorate of Vigilance cell in        A
conducting preliminary inquiry for the reason that the Officer who
submitted a complaint was simply an informant and not the person
interested, at the same time, preliminary inquiry was conducted by a
different Officer not connected with author of the complaint, thus the
plea of bias was ill-founded. In our view, the principles of bias, even
                                                                                B
remotely are not attracted in the facts and circumstances of the present
case.
        35. The rule against bias is an essential component of modern
administrative law. The rule against bias ensures a fair procedure by
excluding decision-makers who are tainted by bias. Under the rule, actual
bias is disqualifying even though it is prohibitively difficult to establish.   C
The basic principle underlying the time-tested rule is that justice must
not only be done but must also appears to be done and this rule has
received wide recognition in several decisions of this Court and for our
consideration we take note of the judgment of this Court in A.K. Kraipak
and others vs. Union of India and others1, wherein in para 15 this              D
Court held as under:
         “15. It is unfortunate that Naqishbund was appointed as one of
         the members of the selection board. It is true that ordinarily the
         Chief Conservator of Forests in a State should be considered as
         the most appropriate person to be in the selection board. He must      E
         be expected to know his officers thoroughly, their weaknesses as
         well as their strength. His opinion as regards their suitability for
         selection to the All-India Service is entitled to great weight. But
         then under the circumstances it was improper to have included
         Naqishbund as a member of the selection board. He was one of
         the persons to be considered for selection. It is against all canons   F
         of justice to make a man judge in his own cause. It is true that he
         did not participate in the deliberations of the committee when his
         name was considered. But then the very fact that he was a member
         of the selection board must have had its own impact on the decision
         of the selection board. Further admittedly he participated in the      G
         deliberations of the selection board when the claims of his rivals
         particularly that of Basu was considered. He was also party to
         the preparation of the list of selected candidates in order of
         preference. At every stage of his participation in the deliberations
1
    1969 (2) SCC 262                                                            H
576               SUPREME COURT REPORTS                              [2023] 2 S.C.R.


A              of the selection board there was a conflict between his interest
               and duty. Under those circumstances it is difficult to believe that
               he could have been impartial. The real question is not whether he
               was biased. It is difficult to prove the state of mind of a person.
               Therefore what we have to see is whether there is reasonable
               ground for believing that he was likely to have been biased. We
B
               agree with the learned Attorney General that a mere suspicion of
               bias is not sufficient. There must be a reasonable likelihood of
               bias. In deciding the question of bias we have to take into
               consideration human probabilities and ordinary course of human
               conduct. It was in the interest of Naqishbund to keep out his rivals
C              in order to secure his position from further challenge. Naturally
               he was also interested in safeguarding his position while preparing
               the list of selected candidates.
                                                                   (emphasis added)
           36. The aforesaid view was further considered by a Constitution
D     Bench of this Court in Ashok Kumar Yadav and others vs. State of
      Haryana and others2 as under:
               “16. We agree with the petitioners that it is one of the fundamental
               principles of our jurisprudence that no man can be a judge in his
               own cause and that if there is a reasonable likelihood of bias it is
E              “in accordance with natural justice and common sense that the
               justice likely to be so biased should be incapacitated from sitting”.
               The question is not whether the judge is actually biased or in fact
               decides partially, but whether there is a real livelihood of bias.
               What is objectionable in such a case is not that the decision is
F              actually tainted with bias but that the circumstances are such as
               to create a reasonable apprehension in the mind of others that
               there is a likelihood of bias affecting the decision. The basic principle
               underlying this rule is that justice must not only be done but must
               also appear to be done and this rule has received wide recognition
               in several decisions of this Court. It is also important to note that
G              this rule is not confined to cases where judicial power stricto sensu
               is exercised. It is appropriately extended to all cases where an
               independent mind has to be applied to arrive at a fair and just
               decision between the rival claims of parties. Justice is not the
               function of the courts alone; it is also the duty of all those who are
H     2
          1985 (4) SCC 417
OFFICE OF THE ODISHA LOKAYUKTA v. DR. PRADEEP                             577
      KUMAR PANIGRAHI [AJAY RASTOGI, J.]

  expected to decide fairly between contending parties. The strict        A
  standards applied to authorities exercising judicial power are being
  increasingly applied to administrative bodies, for it is vital to the
  maintenance of the rule of law in a Welfare State where the
  jurisdiction of administrative bodies is increasing at a rapid pace
  that the instrumentalities of the State should discharge their
                                                                          B
  functions in a fair and just manner. This was the basis on which
  the applicability of this rule was extended to the decision-making
  process of a selection committee constituted for selecting officers
  to the Indian Forest Service in A.K. Kraipak v. Union of India
  [(1969) 2 SCC 262]. What happened in this case was that one
  Naqishbund, the acting Chief Conservator of Forests, Jammu and          C
  Kashmir was a member of the Selection Board which had been
  set up to select officers to the Indian Forest Service from those
  serving in the Forest Department of Jammu and Kashmir.
  Naqishbund who was a member of the Selection Board was also
  one of the candidates for selection to the Indian Forest Service.
                                                                          D
  He did not sit on the Selection Board at the time when his name
  was considered for selection but he did sit on the Selection Board
  and participated in the deliberations when the names of his rival
  officers were considered for selection and took part in the
  deliberations of the Selection Board while preparing the list of the
  selected candidates in order of preference. This Court held that        E
  the presence of Naqishbund vitiated the selection on the ground
  that there was reasonable likelihood of bias affecting the process
  of selection. Hegde, J. speaking on behalf of the Court countered
  the argument that Naqishbund did not take part in the deliberations
  of the Selection Board when his name was considered, by saying:
                                                                          F
     “But then the very fact that he was a member of the Selection
     Board must have had its own impact on the decision of the
     Selection Board. Further admittedly he participated in the
     deliberations of the Selection Board when the claims of his
     rivals ... was considered. He was also party to the preparation
     of the list of selected candidates in order of preference. At        G
     every stage of his participation in the deliberations of the
     Selection Board there was a conflict between his interest and
     duty.... The real question is not whether he was biased. It is
     difficult to prove the state of mind of a person. Therefore what
     we have to see is whether there is reasonable ground for             H
578               SUPREME COURT REPORTS                            [2023] 2 S.C.R.


A                 believing that he was likely to have been biased.... There must
                  be a reasonable likelihood of bias. In deciding the question of
                  bias we have to take into consideration human probabilities
                  and ordinary course of human conduct.”
               This Court emphasised that it was not necessary to establish bias
B              but it was sufficient to invalidate the selection process if it could
               be shown that there was reasonable likelihood of bias. The
               likelihood of bias may arise on account of proprietary interest or
               on account of personal reasons, such as, hostility to one party or
               personal friendship or family relationship with the other. Where
               reasonable likelihood of bias is alleged on the ground of relationship,
C              the question would always be as to how close is the degree of
               relationship or in other words, is the nearness of relationship so
               great as to give rise to reasonable apprehension of bias on the
               part of the authority making the selection.”
                                                                  (emphasis added)
D
              37. In the instant case, the complaint was made by the Deputy
      Superintendent of Police (Mr. Ranjan Kumar Das) of the Directorate of
      Vigilance, who is, directly or indirectly, not concerned with the complaint,
      he can be said to be an informant to the office of the appellant and that
      apart, a preliminary inquiry was conducted independently by a senior
E     officer of the Directorate of Vigilance, Additional Superintendent of
      Police, Mr. P.K. Naik, who submitted his report of the preliminary inquiry
      on 28 th May, 2021, the question of bias in the instant facts and
      circumstances does not arise at all and that apart, the Constitution Bench
      of this Court recently in Mukesh Singh vs. State (Narcotic Branch of
F     Delhi)3, while examining the question as to whether in case investigation
      is conducted by the police officer who himself is a complainant is the
      trial stands vitiated and the accused is entitled to acquittal and after
      examining the scheme of the Code, finally answered the reference as
      under:

G          “13. From the above discussion and for the reasons stated above,
      we conclude and answer the reference as under:
               13.1. (I) That the observations of this Court in Bhagwan Singh
               v. State of Rajasthan [(1976) 1 SCC 15], Megha Singh v. State
               of Haryana [(1996) 11 SCC 709] and State v. Rajangam [(2010)
      3
H         2020 (10) SCC 120
      OFFICE OF THE ODISHA LOKAYUKTA v. DR. PRADEEP                                579
            KUMAR PANIGRAHI [AJAY RASTOGI, J.]

         15 SCC 369] and the acquittal of the accused by this Court on the         A
         ground that as the informant and the investigator was the same, it
         has vitiated the trial and the accused is entitled to acquittal are to
         be treated to be confined to their own facts. It cannot be said that
         in the aforesaid decisions, this Court laid down any general
         proposition of law that in each and every case where the informant
                                                                                   B
         is the investigator there is a bias caused to the accused and the
         entire prosecution case is to be disbelieved and the accused is
         entitled to acquittal.
         13.2. (II) In a case where the informant himself is the investigator,
         by that itself cannot be said that the investigation is vitiated on the
         ground of bias or the like factor. The question of bias or prejudice      C
         would depend upon the facts and circumstances of each case.
         Therefore, merely because the informant is the investigator, by
         that itself the investigation would not suffer the vice of unfairness
         or bias and therefore on the sole ground that informant is the
         investigator, the accused is not entitled to acquittal. The matter        D
         has to be decided on a case-to-case basis. A contrary decision of
         this Court in Mohan Lal v. State of Punjab [(2018) 17 SCC 627]
         and any other decision taking a contrary view that the informant
         cannot be the investigator and in such a case the accused is entitled
         to acquittal are not good law and they are specifically overruled.”
                                                                                   E
                                                            (emphasis added)
        38. We are of the considered view that there was no element of
bias in conducting a preliminary inquiry in the instant case and the objection
raised by the respondents stands overruled.
       39. The further objection raised by the respondents is in reference         F
to the locus standi of the appellant in filing appeal in this Court and in
support of his submission, counsel placed reliance on the judgments of
this Court in National Commission for Women vs. State of Delhi and
another4 and M.S. Kazi vs. Muslim Education Society and others5.
In our considered view, the submission is wholly bereft of merit for the           G
reason that the action of the appellant initiated pursuant to order dated
11th December, 2020 for conducting a preliminary inquiry in exercise of
powers conferred under Section 20(1) of the Act, 2014 was a subject
4
    2010 (12) SCC 599
5
    2016 (9) SCC 263                                                               H
580             SUPREME COURT REPORTS                            [2023] 2 S.C.R.


A     matter of challenge before the High Court at the instance of respondent
      no.1 and if that is being interfered with and the action of the appellant is
      being set aside under the impugned judgment dated 3rd February, 2021,
      the appellant, indeed, was a person aggrieved and has a locus standi to
      question the action interfered with by the Division Bench of the High
      Court and the only remedy available with the appellant is to question the
B
      order of the Division Bench of the High Court by filing an special leave
      petition in this Court under Article 136 of the Constitution.
             40. The judgment in National Commission for Women (supra)
      on which the respondents have placed reliance was a case where in
      criminal trial, in the first instance held by the trial Court, the accused
C     was convicted and on appeal being preferred by him, was later acquitted
      by the competent Court of jurisdiction and obviously appeal could be
      preferred against the order of acquittal either by the prosecution i.e. the
      State Government or the victim, under Section 378 of the Code of Criminal
      Procedure, 1973, but either of the party has not preferred any appeal
D     and it was the National Commission for Women who approached this
      Court by filing a special leave petition under Article 136 of the Constitution
      and this Court still has ventured to examine the appeal preferred by the
      Commission on merits, but observed that the special leave to appeal at
      the instance of the appellant – National Commission for Women, is not
      maintainable and obviously at least the National Commission for Women
E     was not a person aggrieved and it has no locus to object the order passed
      by the competent court of jurisdiction.
             41. At the same time, the judgment of this Court in M.S. Kazi
      (supra) was a case where the teacher was terminated by a minority
      institution after conducting a disciplinary inquiry. As the matter travelled
F     to the High Court under Article 226/227 of the Constitution and at this
      stage the Division Bench of the High Court observed that since the
      Tribunal is not a party respondent who was the Administrator before
      whom the dispute inter se between the parties i.e. the teacher and the
      minority institution was examined, the objection was sustainable, still
G     that objection was turned down by this Court as referred in para 9 and
      held that it is the person aggrieved who has to pursue his or her remedy
      available under the law and in the case on hand the person aggrieved
      invoked the jurisdiction of the Tribunal, but the Tribunal was not a
      necessary party to the proceedings for the reason that the lis was between
      teacher and the minority institution and accordingly, this Court held that
H
   OFFICE OF THE ODISHA LOKAYUKTA v. DR. PRADEEP                               581
         KUMAR PANIGRAHI [AJAY RASTOGI, J.]

the High Court has committed an error in dismissing the letters patent         A
appeal on the ground that it was not maintainable in the absence of
Tribunal being a party respondent.
       42. Both the judgments relied upon are not even remotely
concerned with the facts and circumstances of the present case. To say
in other words, if the order of the appellant directing the Directorate of     B
Vigilance to conduct the preliminary inquiry in exercise of power under
Section 20(1) of the Act, 2014 dated 11th December, 2020 has been set
aside by the High Court, obviously, the appellant is a person aggrieved
and can certainly question the legality/validity of the judgment of the
High Court impugned by invoking jurisdiction of this Court under Article
136 of the Constitution.                                                       C

       43. Consequently, the appeals succeed and are accordingly
allowed. The judgment of the High Court dated 3rd February, 2021 and
the review order dated 5th April, 2021 are hereby set aside. No costs.
       44. Pending application(s), if any, shall stand disposed of.            D

Divya Pandey                                                Appeals allowed.
(Assisted by : Roopanshi Virang, LCRA)


                                                                               E




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