News Citation : 2026 LN (HC) 188 | 2026:CGHC:11398

March 10, 2026 : The Chhattisgarh High Court has set aside the conviction of two men in a decades-old corruption and cheating case linked to the procurement of seamless pipes for the Bhilai Steel Plant, ruling that the prosecution failed to prove any criminal conspiracy or misconduct.

In a judgment delivered on March 10, 2026, Justice Rajani Dubey allowed two criminal appeals filed by Jaffer Sadik, a former inspection manager at the Bhilai Steel Plant’s Mumbai office, and Mahendra Pratap Chandra Shah, a partner of Mico Metal Industries. Both had challenged a 2006 trial court verdict that convicted them under provisions of the Indian Penal Code and the Prevention of Corruption Act.

The trial court had earlier found the two guilty of offences including criminal conspiracy and cheating in connection with the purchase of seamless pipes. Sadik was sentenced to one year of rigorous imprisonment with fines, while Shah was given a two-year prison term along with fines.

The case dates back to the early 1990s and involved the procurement of 325 metres of seamless pipes for the Bhilai Steel Plant. According to the prosecution, officials rejected pipes offered by Arvind Steel Corporation at ₹3,330 per metre and instead approved a purchase from Mico Metal Industries at a higher price of ₹4,495 per metre, allegedly causing financial loss to the public sector plant.

Investigators claimed that the accused officials had deliberately rejected the lower-priced material and conspired with the supplier to favour the higher-priced deal.

However, the High Court found that the evidence did not support these allegations. The court noted that Sadik’s role was limited to inspecting the materials, while procurement decisions were taken by other officials responsible for purchase orders. Witness testimonies also indicated that the inspection department and purchase department operated separately and followed established procedures.

The court observed that the prosecution failed to produce credible evidence showing any meeting of minds between the accused or any dishonest intention to gain personal benefit. It further noted that witnesses themselves acknowledged that the procurement process was conducted according to official procedures and documentation.

Justice Dubey held that merely awarding a contract at a higher rate could not by itself prove criminal conspiracy or corruption without evidence of abuse of official position or unlawful gain. The court also relied on Supreme Court precedents which state that administrative lapses or procedural irregularities do not automatically amount to criminal misconduct unless accompanied by corrupt intent.

Concluding that the prosecution had “utterly failed” to establish conspiracy or illegal conduct, the High Court allowed both appeals and acquitted Sadik and Shah of all charges.

The court directed the appellants to furnish personal bonds of ₹25,000 each for a period of six months in accordance with the Bharatiya Nagarik Suraksha Sanhita, to ensure their appearance before the Supreme Court if a special leave petition is filed against the judgment.

Case Reference : CRA No. 493 of 2006 (Jaffer Sadik, S/o Mohd. Molvik vs Union of India through CBI, Jabalpur [now Raipur, Chhattisgarh]) Counsels: Mr. Manoj Paranjpe, Senior Advocate with Mr. Arpan Verma for the Appellant; Mr. B. Gopa Kumar for the Respondent (via VC); and CRA No. 528 of 2006 (Mahendra Pratap Chandra Shah, S/o Pratap Chandra vs Union of India through CBI, Jabalpur [now Raipur, Chhattisgarh]) Counsels: Mr. Manish Thakur for the Appellant; Mr. B. Gopa Kumar for the Respondent (via VC).