NEW DELHI: The Supreme Court on Tuesday delivered a split judgment on a petition by Telugu Desam Party (TDP) president and former Andhra Pradesh chief minister N Chandrababu Naidu for quashing a case filed against him by the Crime Investigation Department (CID) in the alleged ₹371 crore alleged development scam.

Justices Aniruddha Bose and Bela M Trivedi dissented on the point of law whether a prior approval from the competent authority was required before the initiation of the investigation and the registration of the FIR against Naidu under the Prevention of Corruption (PC) Act.

While justice Bose held that the authorities needed to obtain prior approval of the authorities before initiating an enquiry or an inquiry or an investigation against a public servant when the charges relate to the discharge of official duties, justice Trivedi maintained that the need for such approval under Section 17A of the PC Act would arise only with respect to offences that were relatable to the 2018 amendments when the provision was notified.

Drawing from his conclusion, justice Bose quashed the charges levelled under the PC Act against Naidu. Justice Trivedi, in his dissenting view, upheld the invocation of the corruption charges.

Both the judges, however, remained unanimous that there were no infirmities in the remand order under which Naidu was arrested and sent to police custody in September last year. 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 matter has now been referred to the Chief Justice of India on the administrative side for constitution of a three-judge bench for an authoritative decision on the corruption charges against Naidu.

Naidu contended that the FIR against him was registered without obtaining the prior approval of the competent authority in the case, and, therefore, his arrest was illegal. His petition emphasised that mandatory approval under Section 17-A of the PC Act was necessary before the FIR against him since all the alleged acts in the case were relatable to the decisions taken by him in the discharge of his official duties as chief minister.

While Naidu argued that Section 17A was applicable in the case as the inquiry started in December 2021, the Andhra Pradesh government countered his plea, contending that the inquiry in the case began in 2017 when section 17-A, a new provision, had not kicked in.

Section 17A was introduced by an amendment with effect from July 26, 2018. It requires 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 PC Act.

The state government further contended that the Central Bureau of Investigation (CBI) was seized of the matter even before the present government came to power in May 2019 and that a subsequent registration of an FIR in December 2021 will not make it mandatory for the police to take prior approval before arresting Naidu.

The investigation against Naidu centres around allegations that government funds intended for a skill development project were diverted into various shell companies through fraudulent invoices, which did not correspond with the delivery of services.

Naidu was arrested on September 9 last year for allegedly misappropriating funds from the Skill Development Corporation when he was the chief minister in 2015, causing a purported loss of ₹371 crore to the state exchequer. Naidu has denied the allegations. The Andhra Pradesh high court on November 20 granted him regular bail in the case.

On October 17, the top court reserved its verdict on Chandrababu Naidu’s plea challenging the high court order of September 22 refusing to quash the FIR against him in the case. The high court had said there was no case to interfere with the proceedings when the probe in the case was at the fulcrum of attaining finality. It added that since the former CM’s alleged actions are unconnected with his official duties or functions, the requirement of prior approval or sanction under Section 17-A of the Prevention of Corruption Act was inapplicable.

Senior advocates Harish Salve and Sidharth Luthra, appearing for the 73-year-old TDP chief, had earlier argued that the entire investigation and arrest of their client was illegal since no sanction under Section 17-A of the PC Act was obtained.

Naidu claimed that the present scenario of regime revenge and political vendetta is exactly what Section 17-A seeks to restrict by protecting innocent persons, adding the initiation of investigation without such approval vitiates the entire proceedings since inception and the same is a jurisdictional error. He further alleged the Andhra Pradesh CID was acting at the behest of the ruling party to hurt TDP’s chances in the state election due early next year and called it a “clear example of regime revenge”.