KAILASH JOSHI Vs. STATE OF M.P.

JUDGEMENT

(1.) THIS is a Public Interest Litigation regarding what is termed as Churhat Lottery Scandal. The Petitioner is seeking cancellation of the licence which was granted under M. P. Lottery (Niyantran Tatha Kar) Adhiniyam, 1973, (hereinafter referred to as Lottery Act) for holding the lottery, submission of accounts of the different draws of the lottery and the prizes distributed, quashing the order of the Collector condoning holding of lotteries beyond the licence period, quashing the order of the State Government granting exemption from payment of tax, for prosecution of the Society for committing various illegalities and irregularities in conducting the lottery against the provisions of the Lottery Act and M. P. Lottery (Niyantran Tatha Kar) Niyam, 1974, (hereinafter referred to as Lottery Rules) and the licence conditions, enquiry by an independent agency into the affairs of the Society and taking action against the Collector for granting licence without enquiry and without seeking full compliance of the provisions.

(2.) THE Petitioner Shri Kailash Joshi is a leader of the Opposition in M. P. Vidhan Sabha. He has been Ex -President of the State Bhartiya Janta Party and was also Chief Minister of the State for sometime. Respondent No. 3 Shri Arjun Singh was elected as the Chief Minister of the State in June 1980, having been elected from Churhat Constituency in the Vidhan Sabha in the general elections and he continued his full term and thereafter he was again elected Chief Minister and in that capacity he continued up to 12 -3 -1985 when he was appointed as Governor of Punjab. He resigned from Vidhan Sabha seat. In his place, his son Shri Ajay Singh, Respondent No. 7, has been elected in the Vidhan Sabha from this constituency. The Respondent No. 3 then joined the Central Cabinet and thereafter became the Vice -President of the All India Congress Party. After sometime, he again became Cabinet Minister in the Ministry of Communication and returned to the State as Chief Minister on 14 -2 -1988. Shri Motilal Vora, the present Central Cabinet Minister for Health was the Chief Minister of the State between 13 -8 -1985 to 13 -2 -1988. It is not disputed that on the inspiration of the Respondent No. 3, Churhat Children Welfare Society (for brevity hereinafter referred to as Churhat Society) was registered under M. P. Registrikaran Adhiniyam, 1973, with the object of promoting education, rehabilitation and health to children, implementation and publicity of family welfare programmes and running of schools, libraries, training centres, welfare centres etc. with Shri Martand Singh ex -ruler of Rewa State and ruling party Member of Parliament as the Chairman, Dr. Sajjan Singh, brother of Respondent No. 3, as Vice Chairman, Shri Ajay Singh son of Respondent No. 3 as Secretary, Shri B.P. Singh, son -in -law of the Respondent No. 3, as Treasurer and Shri S. P. Singh, another relation of the Respondent No. 3 as member of the governing body.

(3.) THE Petitioner who is leader of the Opposition in the Vidhan Sabha has submitted that he has a duty to see that the State Government acts within the four corners of law and the public funds are spent only in public interest. He along with others raised the question regarding Churhat lottery but nothing came out on the pretext of the State Government that the matter is subjudice in High Court. Questions were also raised in the Loksabha and Rajyasabha but again nothing came out in view of the statement furnished by the State Government that Churhat Society has already received rupees 99 lacs from its organising agent for holding the lottery, some of the prize money could not be distributed since tickets were seized by Income -tax authorities and Churhat Society is running a hospital and engaged in other social activities. The State Government has taken a decision to make the provisions of the Act more stringent. The Petitioner and others also made a complaint to the Rajya Pal, bringing to his notice that there are grave illegalities and irregularities committed in holding the lottery and funds diverted and demanded an enquiry, but since the close relations of the Chief Minister were connected with the lottery, no action was taken. The licence to hold the lottery was granted by the Collector under pressure from the State Government when the Respondent No. 3 was the Chief Minister. The Collector granted licence mechanically without making any enquiry and without obtaining any details regarding compliance for holding the lottery in accordance with the Act and the Rules. Churhat Society sold its rights to hold the lottery to M/s. A and A Enterprises which was not permissible under the Lottery Rules as the licence was granted personally to the Society. Entire tickets were printed, sold, amounts collected, draws arranged and prizes disbursed by the organising agent from Delhi. Apparently, the organising agent has earned huge profits and even pocketed the undisbursed prize monies. A confusion was deliberately created by not giving the address of Churhat Society on the lottery tickets, with the result prize winners had to run from pillar to post without getting their prizes, one of them being Head Constable Mahalingam of Madras City Police, holding ticket no CE. 3192475 who got second prize of rupees five lacs in the second draw (wrongly mentioned as 7th draw). Churhat Society did not furnish any accounts as required under Rule 11, breach of which is punishable under Rule 12. The Collector by his letter dated 13 -11 -1984 pointed out to Churhat Society that it was given licence to hold only one draw but they have already held 3 draws so far and so it was directed not to hold any further draws, yet disobeying the order of the Collector the Society held 9 more draws. No returns were submitted after each draw giving details of the tickets, sold, prizes distributed, expenses incurred and profits earned. In order to camouflage the issue, Churhat Society merely submitted annual statement of accounts from 1983 to 1986 which was not in compliance with the requirements of the licence conditions and the rules. The Director of Lotteries in his report dated 29 -3 -1986 submitted that 9 draws were unauthorisedly held without caring for the Collector's order. No information has been furnished by the Society in spite of varies queries made and only evasive replies were given, prizes were not being paid to the prize winners and so the Society should not be exempted from payment of lottery tax. It was reported that there was no such office of the Society at Churhat or at Rewa. Eeven the officers of the Directorate did not get any information from these two places.