Two officers of Exide Industries Ltd., a registered company, under Indian Company's Act, 1956 having it's registered office at 59 E, Chaurangi Road, Kolkata and Regional Office at 3 E-1 Jhande Wala Extension, New Delhi, namely Sanjeev Sinha (A-1), Head Coordinator and S.B. Raheja (A-2) Non-Executive Director, preferred instant 482 Cr.P.C. Application, with a motive to get their criminal prosecution in Complaint Case No. 64 of 2005, Vipul Agarwal Vs. Exide Industries Ltd., under sections 420, 406, 120-B I.P.C. pending before C.J.M., Ghaziabad, and their summoning order dated 11.4.2007, passed in that case, be quashed.
Before adverting to various harangued contentions, raised and refuted by rival contesting sides, background facts, stated abridgedly, as are evident from the affidavit filed on behalf of applicants along with this 482 Cr.P.C. Application, counter affidavit filed by complainant respondent no.1, and rejoinder affidavit filed on behalf of applicants in reply to the counter affidavit, indicates that Exide Industries Ltd. is a company duly registered under the Indian Companies Act 1956. A-1, is it's Head Coordinator, manning company's office situated at 3 E-1 Jhande Wala Extension, New Delhi, whereas A-2 is company's Non- Executive Director, residing at Exide House 59-E, Chaurangi Road, Kolkatta. Company is engaged in production, sale and export of storage batteries. Exide Industries Ltd. has it's regional offices, branches, over most of the State in India and one of it's office is situated at D- 42, Patel Nagar-IInd, Ghaziabad, of which one Das Gupta and Shailendra Tandon, two non-applicant accused, are in-charge.
Respondent complainant Vipul Agarwal is the sole proprietor of Firm M/s Globe Enterprises and is a resident of Chandra Puri, Hapur Road, near Gurudwara under P.S. Kotwali, district Ghaziabad.
It is alleged by the complainant that the two non-applicant accused, Das Gupta and Shailendra Tandon, approached complainant respondent no.1, as agent of the said Company and informed him that they are in-charge of company's regional office and made deceitful false representations for convincing the complainant to purchase companies Exide Power House Batteries on payments. In that feat they made false assurances with the complainant on numerous occasions , both personally and on telephonic conversations. They deceived the complainant, respondent no.1, by assuring him that they will ensure supply of those storage batteries manufactured by the company, branded in the business world as Exide Power House no sooner the sale prices of those batteries are credited in company's account. Believing their deceitful false representations and deception to be genuine, that the complainant respondent no.1,Vipul Agarwal, parted with a handsome fortune of Rs. 15,15000/- and got issued three demand drafts in the name of the company, Exide Industries Ltd., from Oriental Bank of Commerce, Ghaziabad, the details which are as follows:-
D.D. No. 177469 (Rs. 1,25,000/-) D.D. No. 616165 (Rs. 4,00,000/-) and D.D. No. 616669 (Rs. 9,90,000/-).
These drafts were issued on 30.1.2003, 27.2.2003 and 29.3.2003. Das Gupta and Shailendra Tandon, accepted these drafts and again gave false assurance to the complainant respondent no. 1 that as soon as the drafts are credited in company's account, supply of Exide Power House batteries shall be ensured to the complainant. Vide para 5 of the complaint it was specifically averred that Exide Industries Ltd. being a company of trusted goodwill, complainant acted on assurances given by Das Gupta and Shailendra Tandon and because of that had tendered the above referred demand drafts which stood in company's name. It is further alleged that the company received complaint's drafts and got it en-cashed in it's account but did not supply Exide Power House batteries to the complainant respondent no.1, as was promised by the two in-charge co-accused on behalf of the company, Das Gupta and Shailendra Tandon. Failing to receive supply of batteries complainant contacted A-1, orally as well as on telephone and requested him to make good supply of batteries, but on each occasion only a false assurance was given to the complainant and consequently left with no other option complainant served a legal notice on the accused through his counsel, demanding supply of batteries. This legal notice, albeit was received to the accused but they ignored it and batteries were not supplied to the complainant, respondent no.1 and to his utter dismay the applicants even denied receipt of any money from him and also abjured having any business contract with him. They thus refused to acknowledge receipt of drafts money from the respondent complainant. After receiving such a reply, complainant got a certificate issued from the Oriental Bank of Commerce, Ghaziabad regarding details of those drafts and dispatched another written notice to the accused annexing therewith the bank certificate, which contained details of those drafts and requested for supply of batteries, but in spite of receiving that second notice it was not honoured. A notice served on the accused has been annexed with the affidavit as annexure no.2 and reply thereto has been filed as annexure no.3 and rejoinder reply by the complainant is annexure no.4. Such sequence of events convinced the complainant respondent no.1 that the applicants, the company and it's other involved officers, in execution of their cheating conspiracy and nefarious design has defrauded and cheated him, under the garb of supply of Exide Power House batteries to a tune of Rs. 15,15,000/- which amount they have misappropriated to their own benefit causing wrongful loss to the complainant respondent no. 2 and making wrongful gains for themselves, that the complainant approached the police of P.S. Kotwali to register his FIR but his efforts went in veil. Even the complaint sent through registered post to senior law enforcing agencies did not yield any result. No action was taken against the accused by the police for cheating and fraud committed by them with the complainant respondent no.2 and, therefore, respondent complainant approached the Magistrate under section 156(3) Cr.P.C. on 31.10.05, vide annexure no.10, to the affidavit, seeking his direction to the police to register his FIR. Learned Magistrate after calling for a report from the police regarding registration of any case on behalf of respondent complainant, ultimately rejected complaint's application, vide his order dated 19.10.2005,vide annexure no.12 to the affidavit, for the reasons that no documentary evidence was annexed with the application and the company had also denied entering into any such transaction.
Having no other way out, complainant respondent no. 2 filed regular complaint No. 52 of 2005 vide annexure No.12 before VIIIth A.C.J.M., Ghaziabad, mentioning the allegations sketched herein above and appending therewith the photocopies of documentary evidences, such as the registry receipt, UPC certificate, copy of reply received by him, copy of second notice served by complainant on the accused and other documents. On the basis of said complainant, annexure no.12, an inquiry was commenced by the Magistrate, during course of which he recorded statement of complainant, u/s 200 Cr.P.C. vide annexure no.11, to the affidavit. From the inquiry conducted by learned VIIIth A.C.J.M., he found prima facie offence being disclosed against the applicants and other accused, named in the complaint and statement under section 200 Cr.P.C., that vide his order dated 11.4.2007,leanred trial Magistrate, summoned the applicants, as well as Das Gupta and Shailendra Tandon, for offence under section 420 I.P.C. Meanwhile number of case was altered as Complaint Case No. 64 of 2005.
In the background of above mentioned facts and circumstances, some of the accused, Exide Industries Limited and Sanjeev Sinha,A-1,had approached this Court, under section 482 Cr.P.C. by filing Criminal Misc. Application No. 33100 of 2008, Exide Industries and another Vs. Vipul Agarwal and others seeking quashing of entire prosecution. S.B. Raheja, A-2, had not joined them on this occasion. The aforesaid 482 Cr.P.C. Application came up for admission before one of the Hon'ble Judge of this Court but the applicants therein, for the reasons best known to them, got that 482 Cr.P.C. Application dismissed as not pressed with liberty to file a fresh petition. This Court, vide its order dated 25.11.2008, dismissed the aforesaid 482 Cr.P.C. application as "not pressed with liberty to file fresh petition". Armed with such an order, that the present 482 Cr.P.C application, 6482 of 2008, has been preferred by the two applicants, Sanjeev Sinha,A-1 and S.B. Raheja, A-2, praying for quashing of their prosecution through aforesaid complaint case along with their summoning order. It will apt to take a note at this point that company, Exide Industries, or other two accused Das Gupta and Shailendra Tandon, have not joined the applicants for seeking identical relieves, although on the earlier occasion Exide Industries was an applicant before this court and therefore, so far as the company and left over two summoned accused are concerned they do not have any grievance against their prosecution at least to this date.
The backdrop of preceding fact scenario that I have heard Sri G.S. Chaturvedi, learned senior counsel for the applicant, Sri Siddharth Srivastava, learned counsel for complainant respondent no.1 Vipul Agarwal and Sri Patanjali Mishra, learned AGA for respondent State.
Hankered with the idea to get the prosecution quashed, it was urged on applicants behalf that they have been framed in a false case due to a dispute between complaint and his erstwhile partner, who is also a Proprietor of a Firm M/s Syndicate Motors, which Firm admittedly was the dealer of accused company and used to supply it's manufactured batteries. Next, it was submitted that company had received above three demand drafts from M/s Syndicate Motors, and therefore, the company had supplied batteries to the said Firm and consequently it had not committed any offence. It was further contended that so far as two applicants are concerned, there is no allegation against them and hence, they cannot be prosecuted at all. In support of the said contention, learned counsel referred to paragraph 10 of the complaint. It was also contended that so far as A-2 is concerned, he is a resident of Switzerland and hence cannot be saddled with any criminal liability and his prosecution is malafide. Elaborating the submission, it was contended, on the strength of Apex Court decision in Maksud Saiyed Vs. State of Gujrat and others: 2008 (5) SCC 668, that directors cannot be prosecuted under vicarious liability clause as under I.P.C. Vicarious liability can be fasten only under sections 34 /149 and therefore, prosecution of the two applicants is un-sustainable. Next submission advanced by applicants counsel was that allegations leveled in the complaint relates to a business transaction only and hence discloses only a civil liability and no criminal offence is disclosed thereby and consequently, in view of Apex Court decision in Thermax Ltd. and others vs. K.M. Johny and others: 2011 (11) Scale 128, prosecution of the applicants be quashed. Vehemently, it was harangued that there is not a whisper in the complaint against the applicants and even in statement under Section 200 Cr.P.C., nothing has been averred against them. Both the applicants are the Directors of the Exide Industries Limited and their trial , on the facts and circumstances of the present Application, is unsustainable and should be quashed were the concluding submissions by applicants counsel.
Refuting and snipping applicants urged submissions, Sri Siddharth Srivastava, complainant's counsel as well as learned AGA submitted that instant 482 Cr.P.C. Application is based on entirely different facts, which is the proposed defence of the applicants, and hence by peeping through a different case, not alleged in the complaint by respondent complainant no.2, a genuine complaint lodged by complainant cannot be quashed. It was submitted that pleadings made in the affidavit , filed on behalf of applicants are based entirely on defence of the applicants, contrary to the complainant's version, which is not the prosecution case and therefore, prosecution instituted against the applicants cannot be quashed by looking into such a defence version. At the stage of quashing of complaint the allegations levelled in the complaint has to be accepted as correct and it is from those allegations that it has to be judged as to whether any offence is disclosed or not requiring accused prosecution or not and only by looking into those allegations that the 482 Cr.P.C. Application has to be considered and hence accused defence cannot be considered at this stage. Complainant allegations is entirely different than what has been pleaded in the instant 482 Cr.P.C. Application and therefore, this 482 Cr.P.C. application, being bereft of merits deserves to be dismissed because, it is based on, narration of entirely different facts, which are wholly irrelevant for considering the question of quashing of complaint instituted by complainant respondent no.2. On the basis of a nascent defence of an accused, contrary to the complaint allegations and diametrically divergent from it, no legitimately instituted prosecution can be quashed to impede course of justice, submitted respondents counsel. On the question of disclosure of offence it was pointed out that initially Exide Industries Limited had approached this Court for quashing of the prosecution but, when it was realized that offence are prima facie disclosed it resiled and got it's earlier 482 Cr.P.C. Application dismissed as withdrawn and this second Application has been filed seeking same relief by the applicants who are none else than officers of the said company. Attour, accused nos.3 and 4 in the complaint , namely, Das Gupta and Shailendra Tandon have not come forward for quashing of the prosecution and their summoning order and therefore, entire prosecution instituted by the complainant respondent no.1 cannot be quashed. It was further submitted that the case of the complainant respondent no.1 is that by hatching up of a criminal conspiracy jointly by all the accused, who all collectively, in execution of it, have cheated the complainant respondent no.1 to a tune of Rs.15 lacs 15 thousand in the name of supply of Power House storage batteries, which they never intended to supply to the complainant and now the applicants seeks refuse by fetching out a third case by stating that they had supplied batteries on the drafts in question to their dealer M/S Syndicate Motors. An intention to cheat was present from the very inception of entire transactions is writ large on the face of the record, both from the previous and past conduct. An offence of cheating can be established from the conduct of the parties, which is of prime importance and from the proven facts, in the instant Application, the said offence is prima facies disclosed submitted respondents counsel. Taken to be correct, without any addition of subtraction, complaint allegations, unerringly and prima facie, disclose offence of cheating as well as criminal breach of trust and conspiracy and therefore, complaint cannot be quashed nor applicant's summoning order can be scrapped. It was next submitted that it is not complainant's case that Syndicate Motors was involved at all in the transactions. To escape liability of punishment that applicants accused have fabricated a false defence that they had received the drafts from Syndicate Motors, which version is specifically denied by the complainant. Disputed question on fact and the defence of the accused cannot be considered to nip a legitimate prosecution launch by the complainant into the bud, where cheating is established per se on prima facie evidences submitted learned counsel. It is not the case of the complainant at all that in between company and the complainant a third juristic person had intervened. It was a direct dealing between the company and the complainant/ respondent no. 2 and it was complainant who had submitted the demand drafts issued to him from Oriental Bank of Commerce.
Further, it was contended that pleadings made in the affidavit of this 482 Cr.P.C. Application are self- contradictory, inconsistent and in-congruent, which additionally indicate criminality harbingered by the applicants to escape punishment for the crime committed by them. Firstly, it was pointed out that it is applicant's own case that the drafts in question were received to the company, which got it enchased and credited in it's account. It is also established that theses drafts were got issued by the complainant from Oriental bank Of Commerce and this fact was intimated to the applicants by the complainant by sending legal notices through his counsel, which were received to them and to which they had replied and in spite of that neither the applicants nor the company took any legal action against it's dealer M/S Syndicate Motors, to who applicants and company had supplied Batteries in connivance with each other in execution of a conspiracy between them. Applicants and the company indulged into the crime further by even denying receipt of drafts from the complainant. Thus, from their conduct and communications it is proved that they had no intention from the very beginning to supply the batteries to the complainant in spite of receiving prices of it from the complainant and this is nothing but ex facie disclosure of offence of cheating. In this respect respondents counsel referred to paragraph 8 (j), (m), (n), (o) and (p) of the affidavit filed on behalf of applicants. Offence is also surfaced from the conduct of the applicants when they went ahead and denied even having any transaction with the complainant, although, there exist un-refutable documentary proof and convincing evidence on the record, in the form of annexure CA -2, which is a letter written by Das Gupta, non-applicant accused, as Area Manager -industrial, of Excide Industries Ltd. requesting Oriental Bank Of Commerce to advance over draft to complainant's Firm M/S Glob Enterprises, which according to the company was it's "esteemed business partner". Both the respondent counsel submitted that the demand drafts in the name of Exide Industries Limited were handed over to Das Gupta and Shailendra Tandon and not to Lokesh Goel by the complaint and averments in this respect made in Affidavit filed on behalf of applicants have been specifically denied by the complainant in his courter affidavit and thus there are contradictory versions, which cannot be adjudicated under section 482 Cr.P.C. and requires proof to be established in a proper trial. They further submitted on the strength of page 12 and 14 of the counter affidavit that the demand drafts were got prepared by M/s Globe Enterprises from Oriental Bank of Commerce, Wright Ganj, Ghaziabad Branch on 30.1.2003, 27.2.2002, 29.3.2003 of Rs.1,25000, 400000 lacks, and 919000/=, respectively and these demand drafts were honoured in the company's account on 1.2.2003, 3.32003 and 2.4.2003 and therefore, in view of the averments made in the complaint as well as certificate from the bank, Annexure CA-3, there remains no room for doubt that money of the aforesaid demand drafts were received by the company M/s Exide Industries Limited, from the complainant. It was, therefore, submitted that the conduct of the applicants and the company, both indicate that they had intention to cheat from the very beginning. This view is further strengthened by the fact that in spite of gaining knowledge that money was paid by the complainant, applicants took no action against M/S Syndicate Motors or Lokesh Goel to defraud it and on the contrary they are trying to shield them and they have mendacious their case and have stated fib, away from real truth. The company had full knowledge that it was complainant's Firm, which was inclined to purchase Batteries from the company and co accused Dev Kumar Das Gupta had himself written to the Manager of Oriental Bank of Commerce, Ghaziabad, vide Annexure CA-2, mentioning therein that M/s Globe Enterprises is their "our esteem business partner and he wishes to procure 500 numbers invatubular, 500 batteries in February and March from us, which caste Rs.500/- each." After mentioning the aforesaid fact, it was further written by Das Gupta "Kindly assist him by giving him a suitable Bank overdraft Limited so as to enable him to procure the same from us". This communication, Annexure CA-2 to the counter affidavit, which finds mention in paragraph 12 of the CA, coupled with certificate from the Oriental Bank of Commerce, annexure CA-3, referred to in Paragraph 23 of the CA has not been refuted by any convincing material so as to show that these are sham documents and relying upon paragraphs 12 and 23 of the rejoinder affidavit it was submitted that genuineness of these document have not been doubted and disputed at all. In Paragraph 23 of the affidavit applicants have themselves averred that the demand draft were "sent" by M/s Syndicate Motors, which makes it only a career at the worst. It was next submitted that two applicants have not been arraigned as an accused in their individual capacity but they are being prosecuted as officers of the Company who were responsible and in-charge to the business of the Company on day to day basis and therefore, their summoning order and prosecution cannot be quashed. In support of the said contention, learned counsel for the informant pointed out at Annexure no.3 to the affidavit filed by the applicant, which is a reply submitted by A-1 to the counsel for the complainant respondent no. 2, in reply to the notice which was served on the Company by the complainant and submitted that it is evident that A-1 was in charge of and acted on behalf of company in day to day business and complainant had all the reasonable prognosis in opining thus. It was further submitted that both the applicants were involved in the crime directly along with the company and hence to register a complaint against them as principal accused along with the company was neither malicious nor vexatious.
It was next submitted that plea of accused applicants that they received the drafts from M/s Syndicate Motors is their defence version, which cannot be considered to deny complainant's assess to justice, especially when applicants case itself is that M/s Syndicate Motors, Ghaziabad, was company's dealer, as has been averred by them in Paragraph 8 (I) and (j), and therefore, the applicants have not only cheated the complainant respondent no.2 but have supplied the batteries to M/s Syndicate Motors without any authority knowingly and intentionally and they have not taken any step to redeem complaint till date, which indicates their direct involvement in cheating complainant. Learned Counsel therefore submitted that if the company had taken the money from the complainant respondent no.2 and it denies received sum of the money and create a mendaciously fabricated defence and does not supply the goods about which it had already received the money then it commits offence of cheating per se coupled with offence of criminal breach of trust, in execution of a hatched up criminal conspiracy and therefore, the offence against the applicants are squarely made out and they cannot escape liability. A-2, was also responsible for conduct of day to day business of the Company and therefore was rightly made an accused and against him also prosecution cannot be quashed. It was further argued that it can never be the law that under no circumstances Director of a company can be prosecuted. It will be preposterous to cogitate that a Director, even if involved in criminal conspiracy of cheating and fraud, merely because of his post and designation, can escape the liability of criminal trial and punishment. It was submitted that Das Gupta and Shailendra Tandon, other accused, who had approached the complainant were the agent of the company as has been averred in paragraph 8(n) of the affidavit and therefore, the company and it's officers who were responsible for conducting business of the company both were equally liable for cheating.
It was next contended that the defence of the applicants itself shows that M/s Syndicate Motors was only the carrier of the demand draft. The demand draft was not issued to the said Firm. M/s Syndicate Motors and M/s Global Enterprises are two different entities having different proprietors and therefore, the defence of the applicant that they had received the draft from M/s Syndicate Motors cannot protect them from punishment of cheating the complainant respondent no.2. It was further submitted that the complainant specifically denies involvement or participation of M/s Syndicate Motors in the concerned transactions and in fact the company and the applicant's right from the very beginning intended to cheat the complainant respondent no.2. In support of his contentions, learned counsel for the informant cited various decisions including Lee Kun Hee and others Vs. State of U.P. and others: 2012 AIR SCW 1316. Drawing the curtain of their arguments, both the counsel submitted that the present 482 Cr.P.C. Application is bereft of merits and deserves to be dismissed.
I have considered rival contentions and have vetted and summated through the entire record of this present 482 Cr.P.C. Application. From the pleaded facts and circumstances and sequence of events, it is evident that on some of the aspects there is discord between rival sides and hence they are proved beyond doubt. These facts are that the complainant respondent no.2 is the proprietor of M/s Global Enterprises, which is a different Firm than M/s Syndicate Motors, Ghaziabad, of which one Lokesh Sharma is the Proprietor and said M/S Syndicate Motors, Ghaziabad, is the dealer of Exide Industries Ltd. vide para 8(i) of the affidavit. It is also established that co accused Dev Kumar Das Gupta, non- applicant accused, on the date of commission of offence was industrial Sales Officer, of Exide Industries Ltd. of Ghaziabad branch, vide para 8(n) to the affidavit and was also working as it's Area Manager-Industrial, vide annexure CA-2 to the counter affidavit. It is also not disputed that the demand drafts, referred to in the complaint, were got issued by the complainant's Firm M/s Global Enterprises, from Oriental Bank of Commerce,, Write Ganj, Branch, Ghaziabad, on 30.1.2003,27.2.2003, an d 29.3.2003, in favour of M/S Exide Industries Ltd. of Rs. 125000/-, 400000/-, 990000/- respectively and were credited in companies account on 1.2.2003,3.3.2003 and 2.4.2003 vide para 8(n) of applicants affidavit coupled with annexure no. CA3 to the counter affidavit. It is also not disputed that these demand drafts were handed over to Dev Kumar DasGupta as agent of the company Exide Industries Ltd.
Para 8 (q) of applicants affidavit, is proof of complainant's allegations that Das Gupta had approached him and that it was on his representation that the drafts were got issued in the name of the company and were handed over to Das Gupta for supply of batteries. It is also not disputed by the applicants vide paras 8(n), (o), (p), and (q) of the affidavit filed on their behalf that the batteries were never supplied to complainant's Firm, which again establishes complainant's allegations of being deceived and was made to hand over valuable securities on such deception. Thus the first two ingredients of making out an offence of cheating i.e.: "by deceiving any person, fraudulently and dishonestly indices the person so deceived to deliver any property to any person.............. or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit if he were not so deceived....." is established on record without any ambiguity. It is also not in dispute that after Das Gupta submitted those demand drafts in the company, the company did not supply the batteries to M/s Global Enterprises, Complainant's Firm and hence it is also established without any doubt that complainant was cheated of the price of batteries and consequently the second ingredient for making out an offence of cheating is also disclosed on the facts and circumstances of the present Application. It is also culled out that instead of supplying batteries to the complainant's Firm, it were supplied to M/s Syndicate motors, which was admittedly the dealer of Exide Industries Ltd. and thus what has been established on record is that the money of supplied batteries was paid by the complaint's Firm M/s Global Industries, whereas the batteries were supplied to M/s Syndicate Motors, who was the authorized dealer of Exide Industries Ltd. Applicants deny receiving of any money from the complainant and they even deny having any business transaction with him. They have pleaded both these facts in the affidavit filed on their behalf in paras 8(h),(i), and (s) read together and hence what is writ large on the admitted facts is that the company through it's agent/ dealer induced complainant to part away with Rs. 1515000/- on a false pretext of supply of Exide Power House Batteries, which it and the applicants never intended to supply to the complainant and all the accused jointly in conspiracy with each other misappropriated that amount by cheating complainant and supplying the batteries to company's dealer M/s Syndicate Motors, without any right or reason and when they were informed about the said fraud, then, instead of reimbursing the complainant, they denied entire transaction and receipt of money. This is nothing but fraud and cheating for which both the applicants along with the company and other accused Dev Kumar Das Gupta and Shailendra Tandon are responsible. Neither the company nor the applicants are still ready to supply batteries to the complainant or remit back his money with interest and this is ex facie cheating and fraud. Company , being inanimate juristic person, acts only through it's officers and agents and once fraud is committed by a company, all those officers who are involved in it are responsible for the crime and they must be prosecuted. No insult can be added to complainant's injury by scuttling his launched prosecution at it's very thresh hold, as it will amount to fostering fraud and cheating by a company in spite of coming to know of it. In this connection it is also proved that notices dispatched by the complainant was served on the company, the reply to which was given by Sanjeev Sinha A-1, on behalf of the Company and therefore it is established on record that he was responsible and in-charge for the business of the company in it's day to day affairs. Company is legal entity. It can prosecute or can be prosecuted in it's own name and along with the company, any person responsible for the conduct of the business of the company on day to day basis can also be prosecuted. On this aspect, a similar analogy can be drawn from the Apex Court decisions in Iridium India Telecom Ltd. Vs. Motorola Incorporate: (2011) 1 SCC 74, wherein it has been held by the Apex Court as under:-
"59. The courts in England have emphatically rejected the notion that a body corporate could not commit a criminal offence which was an outcome of an act of will needing a particular state of mind. The aforesaid notion has been rejected by adopting the doctrine of attribution and imputation. In other words, the criminal intent of the "alter ego" of the company/body corporate i.e. the person or group of persons that guide the business of the company, would be imputed to the corporation."
Just as company and/or corporations can be held liable for the act of it's officers or agents, similarly officers of the company can be held liable with offence which has been committed by the company with their connivance and in their knowledge. It cannot be lost sight of that company or corporation, being inanimate objects, act only through it's officers or agents. A company, albeit a legal entity, is an inanimate juristic person, which acts through it's Directors, agents and dealers. The fraud has been committed by the company, its officers, dealers and agents who all were directly involved in the transactions, not vicariously but directly, as principle conspirator accused. In the recent past most glaring example of such type of fraud case is 2G Spectrum Scam where this country is robbed of crores of Rupees because of such fraud and cheating committed by the officers of various companies including the company itself. In such types of crimes as the present one, if the company and it's officers or any of them is not prosecuted or their prosecution is nipped into it's bud at it's very inception, it will be travesty of justice totally illegal and completely in-judicious and will add insult to the victim injuries. The material on record placed by the accused applicants themselves indicate that A-1 & A-2, by the very nature of the office held by them and their act /omission were liable for day to day business of the company and were rightly being prosecuted. It is noted here that M/S Syndicate Motors has not come forward and claimed that the money was paid by it. It is reminded here that for judging as to whether any offence of cheating is disclosed or not entire facts and circumstances alleged by the prosecution has to be taken into account, which includes both present and past conduct of the accused.
Coming to another aspect as to whether under section 482 Cr.P.C. altogether denovo nascent defence of the accused can be considered to deny complainant asses to justice by stultifying prosecution launched by him is concerned, the law has been crystallized to the proposition that by looking to the defence of an accused, which requires evidences to be led and establish the same, prosecution launched against an accused cannot be quashed and moreover disputed questions of fact cannot be adjudicated upon in an application under section 482 Cr.P.C. on affidavits. Once a fact is denied, both the parties have to be relegated to the trial court to establish their allegations and defence plea which require evidences to be led during trial. In the present case accused have come out with altogether a new story, which cannot be considered at all to quash the prosecution launched by the complainant respondent no. 2. On this aspect, reliance can be aptly had from following apex court decisions:-
In Malwa Cotton and Spinning Mills Ltd. v. Virsa Singh Sidhu and Ors.:AIR 2008 SC 3273 it has been held by the apex court as under:-
"6. As rightly contended by learned counsel for the appellant factual disputes are involved. What was the effect of delayed presentation before the Registrar of Companies is essentially a matter of trial. Whether respondent No.1 had intimated the company and whether there was any resolution accepting his resolution are matters in respect of which evidence has to be led. Therefore, the High Court was not justified in its view."
In Ravindra Kumar,' Madhanlal Goenka and Ann v. M/s. Rugmini Ram Raghav Spinners P. Ltd.:AIR 2009 2383 it has been held by the apex court as under:-
"14. In the abovementioned case, this Court has taken the view that when the complaint does not disclose any criminal offence, the proceeding is liable to be quashed under Section 482 CrPC. However, the same is not the situation in the present case. There is no denial of the fact that though 900 bales of cotton was already dispatched, but 100 bales of cotton are yet to be dispatched. The defence raised by the appellant hereinabove can be urged and proved only during the course of trial. While entertaining a petition under Section 482 CrPC, the materials furnished by the defence cannot be looked into and the defence materials can be entertained only at the time of trial. It is well settled position of law that when there are prima facie materials available, a petition for quashing the criminal proceedings cannot be entertained. The investigating agency should have had the freedom to go into the whole gamut of the allegations and to reach a conclusion of its own. Pre-emption of such investigation would be justified only in very extreme cases.
15. While considering the facts of the present case, we are of the Considered opinion that the present case is not one of those extreme cases where criminal prosecution can be quashed by the court at the very threshold. A defence case is pleaded but such defence is required to be considered at a later stage and not at this stage. The appellants would have ample opportunity to raise all the issues urged in this appeal at an appropriate later stage, where such pleas would be and could be properly analysed and scrutinized."
Now turning to another argument that A-2 was a resident of Switzerland and therefore he cannot be prosecuted at all, said argument was advanced without any basis only to be repelled. Address of A-2 of Switzerland has not been mentioned anywhere. His address of Calcutta is mentioned in the instant application and in the pleading also no address of Switzerland is mentioned. If A-2 wanted to take advantage of his stay at abroad he at least, should have brought prima facie material on record to indicate that plea, which he failed to do and therefore said argument being bereft of substance is rejected outright. The said argument, it seems was harangued only because of the position held by the said accused in the company who wanted to shield himself from punishment. Any Directors of a company who is responsible and in-charge of business of the company on day to day basis cannot escape liability in cases of fraud committed both by the company and it's offices and Directors. In this context, the Apex Court decision in Lee Hu Lee (Supra) is of much help which has been cited by counsel for respondent complainant.
There is another important aspect of the present case. Allegations in the complaint is that the money was taken by the complainant from bank through demand drafts which was accepted by the company but instead of supply of goods (batteries), to the complainant respondent no. 2 it were supplied to a third Firm. In such a view, once the receipt of the payment is admitted, it was the responsibility of the company to make good the mistake committed by it and ensure supply of batteries to the actual purchaser but the company and it's Directors the present applicants, not only eschewed such a course of action but, contrary to it, completely denied having taken any money from the complainant and having any transaction with him, which conduct of their's is knowledgeable fraud, more so, when the case of the applicants is that M/s Syndicate Motors was only a carrier of the drafts. This certainly will not absolve the applicants of their primary responsibility to supply the goods to the persons from whom they had taken money. For example, if the postman supplies the demand drafts to the company, will the company supply the goods to the postman is a big question which has to be answered in negative. In this respect, in paragraph 8(n),(p), the status of M/s Syndicate Motors, is mentioned which was only that of a carrier. Very bizarrely, Paragraph 8(q) makes altogether contradictory assertions where it was alleged that Das Gupta had received the drafts from M/s Syndicate Motors. In paragraph 8(p), it is admitted that Sanjeev Sinha had supplied the batteries to M/s Syndicate Motors and thus, the material on record indicate that though the complainant respondent no. 2 paid the price, he was cheated and deceived by the company of the price of the batteries. Thus, core postulate of dishonest intention was present with the applicants and their company right from the very beginning of the transactions and it cannot be said that the intention to cheat the complainant respondent was absent. Thus, the accused cannot avail the benefit from the fact that the cheating was committed in supply of goods, which was a civil act only. Denial of any money being received from the complainant and not having any transaction with him runs counter to applicant's such a plea.
For establishing the charge of cheating, no direct evidence is required and it can be proved even by circumstances, so much so that physical presence of accused is also not essential. On this aspect, reliance can be had on an Apex Court decision in Shivanarayan Kabra v. State of Madras:AIR 1967 SC 986, wherein apex court has held as under:-
"It is not necessary that a false presence should be made in express words by the appellant. It may be inferred from all the circumstances including the conduct of the appellant in obtaining the property and in Ex. P-34 (a) the appellant stated something which was not true and concealed from P. W. 2 the fact that he was not a member of any recognised association and that he was not entitled to carry on the forward contract business. It is clear that P. W. 2 would not have parted with the sum of Rs. 12,000 but for the inducement contained in Ex. P-34 and the representation of the appellant that he could lawfully carry on forward contract business."
Above decision is similar to the present case, as is clear from para 9 of the said decision. Above view has been approved in Devendra Kumar Singla Vs. Baldev Krishna Singla: AIR 2004 SC 3084. It has been held by the apex court, thereunder, as follows:-
".As was observed by this Court in Shivanarayan Kabra v. State of Madras (AIR 1967 SC 986) it is not necessary that a false pretence should be made in express words by the accused. It may be inferred from all the circumstances including the conduct of the accused in obtaining the property. In the true nature of things it is not always possible to prove dishonest intention by any direct evidence. It can be proved by number of circumstances from which a reasonable inference can be drawn."
From the above discussion, it is evident that the facts unerringly indicate that it is not a simple case of civil dispute but it is a case of cheating per se with criminal misappropriation of funds. No battery was ever supplied to the complainant by the company in conspiracy with applicants and its agent which does not seems to possess an intention to supply even as of now and this is nothing but pure simple fraud on the face of it by the company, the applicants and other accused in conspiracy with M/S Syndicate Motors, who was company's dealer. To have annexure No. 5 of the affidavit from M/S Syndicate Motors was a very easy task. Further complainant has specifically denied the genuineness of these communications and it is of no vail to the applicants.
Coming to the decisions cited by applicants counsel, I find that none of those decisions are of any help to the applicants. They were rendered in altogether different facts and circumstances. In none of those cases, it was prima facie established, on the own showing of the accused, that ingredients of making out offence complained were disclosed. Moreover, as is clear from the facts that present is a case of knowledgeable fraud by the company, it's Directors, and agents in conspiracy with it's dealer. Entire 482 Cr.P.C. Application is based on inconsistent and incongruent pleas to any how escape the punishment.
Wrapping up the entire discussion, I find no merit in this 482 Cr.P.C. Application, which stands dismissed.
Dt.9.7.12/Rk/Arvind/Tamang/-