High Court Quashes Corruption Proceedings Against SBI Officer Due to Lack of Sanction:

High Court Quashes Corruption Proceedings Against SBI Officer Due to Lack of Sanction The petitioner, Saroj Kumar Sahoo, was serving as a Relationship Manager (Medium Enterprises) at the State Bank of India (SBI), Sambalpur, when a criminal case was initiated against him by the Vigilance Department. It was alleged that the petitioner, in conspiracy with others, showed undue official favour by sanctioning and disbursing loans to 18 borrowers based on forged documents, causing a loss of Rs. 1.37 Crores to the Bank. The Vigilance Department sought Sanction for Prosecution under Section 19 of the Prevention of Corruption (PC) Act, 1988. However, the Appointing Authority (General Manager, SBI) twice refused to grant the sanction, concluding that while there were procedural lapses and negligence, there was no evidence of criminal intent, conspiracy, or personal gain. Despite this refusal, the Vigilance Court took cognizance of the offenses, leading the petitioner to challenge the proceedings in the High Court. Main Issue: Whether the Trial Court could legally take cognisance of offences under the Prevention of Corruption Act when the Competent Authority had explicitly refused to grant the mandatory Sanction for prosecution. HC's Ruling: The High Court quashed the criminal proceedings against the petitioner. The Court observed that Section 19 of the PC Act imposes a "statutory bar" on taking cognizance of an offense without previous sanction from the competent authority. It noted that the Appointing Authority had applied its mind and found that the petitioner's actions constituted "negligence" rather than "criminality," and thus refused the sanction. The Court emphasized that the Sanctioning Authority is the best judge to decide if a public servant should be prosecuted based on the material evidence.  The Trial Court’s decision to take cognizance was deemed "bad in law" and an abuse of the process of the court, as the refusal of sanction remained valid and had not been challenged or reversed. To Read Full Judgment, Download PDF Given Below