Skill Development scam: Setback for Chandrababu Naidu as SC delivers split verdict on Corruption Act

The Supreme Court delivered a split verdict on Tuesday in connection with a plea filed by former Andhra Pradesh Chief Minister N Chandrababu Naidu. The court rejected Naidu's plea to quash FIR in the Skill Development Corporation scam, but delivered a split verdict on Section 17A PC Act, Bar and Bench reported. The bench has now referred the matter to the Chief Justice of India (CJI).

The plea filed by Chandrababu Naidu had challenged the high court order refusing to quash the FIR against the Telugu Desam Party (TDP) chief by the Crime Investigation Department (CID) in the Skill Development Corporation scam case. 

A bench of Justices Aniruddha Bose and Bela M Trivedi delivered a split verdict on the interpretation and applicability of section 17A of the Prevention of Corruption Act in the case.

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According to news agency PTI, Section 17A was introduced by an amendment with effect from July 26, 2018. The provision under this section stipulates a mandatory requirement for a police officer to seek prior approval from the competent authority for conducting any enquiry or inquiry or investigation into any offence alleged to have been committed by a public servant under the Prevention of Corruption (PC) Act.

The split verdict: What SC judges said

Justice Bose said prior approval for conducting probe for the alleged offences under the PC Act against Naidu was needed. "However, I refuse to quash the remand order. The lack of approval will not make the remand order non-est," Justice Bose was quoted by PTI as saying, while granting liberty to the state to seek such approval.

Meanwhile, Justice Trivedi said section 17A will not apply retrospectively and upheld the high court order refusing to quash the FIR. "The impugned order of remand and impugned judgement of the high court does not suffer from any illegality," Justice Trivedi said while dismissing Naidu's appeal.

According to the Hindustan Times, while, Justice Bose quashed the charges levelled under the PC Act against Naidu, Justice Trivedi upheld the invocation of the corruption charges.

The judges noted that apart from the charges under the PC Act, the TDP chief was also booked for offences under the Indian Penal Code and therefore, the remand order could be upheld. The bench said in view of divergent opinions, the matter be placed before the Chief Justice of India for appropriate directions.

The Skill Development Corporation ‘scam’

TDP chief Chandrababu Naidu was arrested on September 9, 2023, for allegedly misappropriating funds from the Skill Development Corporation when he was the chief minister in 2015. 

According to officials, the case pertains to the establishment of clusters of Centers of Excellence (CoEs) in the state of Andhra Pradesh, with a total estimated project value of ₹300 crore. The agency officials also claimed that the alleged fraud has caused a huge loss to the state government in excess of ₹300 crores.

As per CID, the investigation has revealed irregularities such as before any expenditure by private entities, the then state government provided an advance of ₹371 crores, representing the entire 10% commitment by the Andhra Pradesh government.

Most of the money advanced by the government was diverted to shell companies through fake invoices, with no actual delivery or sale of the items mentioned in the invoices, CID officials said.

In its remand report, the CID said that according to the investigation so far, the total amount spent by private entities on six skill development clusters is sourced exclusively from funds advanced by the Government of Andhra Pradesh and AP Skill Development Center, totalling ₹371 crore.

However, Naidu has denied the allegations.

The Andhra Pradesh High Court had on November 20 last year granted him regular bail in the case. The high court had also dismissed Naidu's petition to quash FIR.

Naidu had then moved the Supreme Court challenging the high court order dismissing his petition for quashing the FIR against him in connection with the alleged scam.

While dismissing his petition, the high court had said criminal proceedings ought not to be scuttled at the initial stage and quashing an FIR should be an exception rather than the rule.

(With inputs from PTI)