MP HC Quashes Prosecution Sanction, Says Spouse’s Independently Disclosed Income Must Be Counted in DA Cases

The Madhya Pradesh High Court has set aside sanction granted for prosecution of a senior State Excise officer in a disproportionate assets case, holding that the sanctioning authority failed to properly consider the independently disclosed professional and agricultural income of the officer’s spouse, who is a practising advocate.

A Division Bench of Justice Vivek Kumar Singh and Justice Ajay Kumar Nirankari allowed the writ petition and quashed the sanction order dated April 4, 2025, along with all consequential proceedings.

The Court held that the sanctioning authority acted without proper application of mind and ignored material demonstrating that substantial portions of income had been legally disclosed through Income Tax Returns and departmental declarations.

"it is quite discernible that since the petitioner No.1 has clearly justified the amount claimed as the income from her professional work, the Income Tax Returns as well as income from farm, receipt from respective Mandi justifying sales and the agricultural equipment unearthed during the raid, all of it points towards only one conclusion that if the professional and subsequent agricultural income of petitioner No.1 is taken into account in that case, the sanctioning authority ought not to have granted sanction and nipped the matter in the bud itself. The case arose from a Lokayukt investigation initiated following a complaint in 2018, leading to searches conducted in 2019 at the residential and official premises of the officer. During the check period from 1998 to 2019, the investigating agency concluded that the petitioners possessed assets disproportionate to known sources of income by approximately 88.20%, leading to grant of sanction for prosecution under the Prevention of Corruption Act read with Section 120-B IPC", the Court observed.

Before the Court, the petitioners contended that the sanction order suffered from non-application of mind as it ignored the independent professional income and agricultural income of the spouse, despite these being supported by Income Tax Returns, agricultural sale records, and departmental disclosures.

It was argued that the wife had been practising law even prior to marriage and had consistently filed tax returns reflecting her earnings.

The petitioners further relied on an internal report of the Excise Commissioner which had concluded that substantial amounts of professional and agricultural income had been wrongly excluded and that the case was not fit for grant of sanction. The Court noted that this recommendation was disregarded without recording reasons.

The State and Lokayukt opposed the plea, contending that the sanctioning authority had considered the material on record and that adequacy of material could not be examined at this stage.

It was also argued that during investigation the spouse had failed to produce sufficient documentation and therefore her income could not be fully accepted.

Rejecting the State’s submissions, the Court reiterated that sanction for prosecution is not a mechanical formality but a statutory safeguard requiring independent application of mind. The Bench emphasised that sanction must be based on evaluation of the entire material and cannot ignore legally disclosed income.

The Court held that “known sources of income” include income duly disclosed under service conduct rules and reflected in Income Tax Returns, observing that income formally declared to tax authorities and intimated to the department constitutes legitimate income in law.

Importantly, the Court held that once the spouse’s professional and agricultural income was considered, the alleged disproportionate assets fell well within permissible limits and could not justify criminal prosecution.

The Court also criticised the approach of treating a professionally qualified spouse merely as an appendage of a government servant, holding that such exclusion of independent income was unreasonable and legally unsustainable.

Holding that the sanction order had been passed mechanically and without proper evaluation of relevant material, the Court quashed the sanction order and all consequential proceedings, observing that continuation of prosecution in such circumstances would amount to abuse of process of law.

Case Title: Meenakshi Khare & Anr. v. State of Madhya Pradesh & Ors.

Bench: Justice Vivek Kumar Singh and Justice Ajay Kumar Nirankari

Date: 28.01.2026