Heard Mr.A.R.Gupta, learned advocate for the applicant, Mr.K.P.Raval, learned Additional Public Prosecutor for the respondent no.1-State and Mr. K.I.Patel, learned advocate for the respondent no.2.
Mr.A.R.Gupta, learned advocate for the applicant, took me through the copy of criminal complaint-Annexure-A and submitted that the bare perusal of the private criminal complaint would not suggest any offence having been prima-facie made out against the applicant who is accused no.3. It is submitted that in the private complaint, the applicant-original accused no.3 is arraigned in capacity as Vice President of the accused no.1-Company. It is submitted that, as a matter of fact, the applicant came to be employed as a Senior General Manager by the Company w.e.f. 06.07.1998 and for that purpose, my attention was drawn to the copy of appointment letter-Annexure-C. It was further submitted that thereafter, he was transferred to Ahmedabad office of the Company on 28.08.1999 (Annexure-D). It is submitted that, in the complaint, the alleged date of offence is stated to be 21.12.1998 and 29.12.1998. It is submitted that as per the complaint all the acts, which allegedly constituted the offences have been done in the Ahmedabad office of the Company. As the applicant was transferred to Ahmedabad on 28th August,1999, and therefore, all the alleged criminal offences occurred prior to the date of taking over charge by the applicant in Ahmedabad office of the Company.
2.1 Mr.A.R.Gupta, learned advocate for the applicant, further submitted that in the criminal jurisprudence, there is no concept of vicarious liability. The respondent no.2-Complainant neither in the complaint, nor the police authority who investigated the matter under Section 202 of the Code of Criminal Procedure in its report alleged that the applicant was personally involved in any of the acts alleged in the complaint. It is, therefore, submitted that no role or any overt act is attributed to the applicant.
2.2 Mr.A.R.Gupta, learned advocate for the applicant relied upon the cases of Maksud Saiyad Vs. State of Gujarat, reported in (2008) 5 SCC 668, M.A.A.Annamalai Versus State of Karnataka & Ors., reported in (2010) 8 SCC 524, Sharon Michael & Ors. Versus State of Tamil Nadu & Anr., reported in (2009) 3 SCC 375, on the issue of vicarious liability and how far any Director or any employee can be said to have been liable for any act of the Company.
2.3 Mr.A.R.Gupta, learned advocate for the applicant submitted that the Trial Court forwarded the criminal complaint to police for investigation under Section 202 of the Code of Criminal Procedure. My attention was drawn to the report of the police (copy at Page No.25) and submitted that even the perusal of the report no where suggests as to how the applicant can be said to be responsible for the offence. No where his role or overt act is referred. It is further submitted that respondent no.2-complainant filed aforementioned private complaint alleging offence punishable under Sections 420, 477-A read with 114 of the Indian Penal Code whereas the Trial Court accepting the inquiry report of the Police Officer, deleted the aforementioned offences and only issued the processes against all the three accused persons including the applicant-accused no.3 for commission of offence punishable under Section 406 read with Section 114 of the Indian Penal Code.
2.4 Mr.A.R.Gupta, learned advocate for the applicant submitted that considering the complaint as a whole together with the definition of criminal breach of trust in Section 405 of the Indian Penal Code, the offence under Section 406 of the Indian Penal Code cannot be said to be even prima-facie made out.
2.5 Mr.A.R.Gupta, learned advocate for the applicant then took me through the affidavit-in-reply filed by the respondent no.2-complainant and certain documents annexed by the complainant with the reply and submitted that there is no dispute that the original accused no.1-Company preferred Criminal Misc.Application No.9633/03 for quashing of the same private complaint and that petition under Section 482 of the Code of Criminal Procedure came to be dismissed by the learned Single Judge of this Court by order dated 24.01.2005. It is submitted that the order passed by the learned Single Judge is per incuriam in the sense that in light of the decision of the Hon'ble Apex Court rendered on 16th September,2003, which held the field till 5th May,2005, clearly reveals that in the said order, the ratio laid down by the Hon'ble Apex Court in the case of Assistant Commissioner, Assessment-II, Banglore & Ors. Versus. Velliappa Textiles Ltd & Anr., reported in (2003)11 SCC 405, was not taken into consideration whereby it has been held by the Hon'ble Apex Court per majority that since a Company is incapable of imprisonment, such prosecution not maintainable and Court cannot on its own substitute a fine for mandatory imprisonment.
2.6 Mr.A.R.Gupta, learned advocate for the applicant submitted that no doubt in the subsequent decision rendered by the Hon'ble Apex Court in the case of Standard Chartered Bank & Ors. Versus. Director of Enforcement & Ors., reported in (2005) 4 SCC 530, the aforesaid earlier decision rendered in the Year-2003, came to be over ruled, but the subsequent decision in the case of Standard Chartered Bank was rendered on 05.05.2005. It is, therefore, submitted that up to 05.05.2005, earlier decision delivered in the Year-2003 by the Hon'ble Apex Court held the field and in the instant case, the learned Single Judge dismissed the application for quashing under Section 482 of the Code of Criminal Procedure filed by the accused no.1-Company on 24.01.2005 overlooking said earlier decision of the Apex Court, and therefore, the order of this Court cannot be looked into as the order being per in-curiam.
2.7 Mr.A.R.Gupta, learned advocate for the applicant submitted on the issue of the aforementioned submission that the order rendered by the learned Single Judge of this Court on 24.01.2005, should be considered as per in-curiam relying upon several decisions as under:-
(1) V.Kishan Rao Vs. Nikhil Super Speciality Hospital & Anr., reported in (2010) 5 SCC 513.
(2) State of Madhya Pradesh Vs. Narmada Bachao Andolan & Anr., reported in (2011) 7 SCC 639.
(3) Siddharam Satlingappa Mhetre Vs. State of Maharashtra & Ors., reported in (2011) 1 SCC 694.
(4) Ashok Ramubhai Patel Vs. Panchayat & Urban Housing & Urban Development Department, reported in 2005 (o) GLHEL-HC 215826.
(5) Jamnagar-Rajkot Gramin Bank Officers' Association & Anr., reported in 1997 (2) G.L.H.767.
Relying upon the aforementioned decisions, Mr.A.R.Gupta, learned advocate for the applicant submitted that the order dated 24.01.2005, passed by the learned Single Judge of this Court dismissing the quashing petition of the accused no.1-Company cannot be considered for the aforementioned reasons as order is per incuriam. Alternatively, it is submitted that, if this Court is concludes that said order is required to be considered, then in light of the earlier decision of the Hon'ble Apex Court in the year-2003, which held the field upto the year-2005 was not considered by learned Single Judge in the aforesaid order, then this matter may be referred to the larger bench of this Court in view of the ratio laid-down in Jamnagar-Rajkot Gramin Bank's Case (Supra).
2.8 Mr.A.R.Gupta, learned advocate for the applicant, therefore, submitted that application may be allowed and private complaint filed by the respondent no.2-original complainant may be quashed qua the applicant.
Mr.K.I.Patel, learned advocate for the respondent no.2 vehemently opposed this application and submitted that not only the quashing petition of the accused no.1-Company came to be dismissed by this Court, but even an application preferred by the original accused no.2 before the Trial Court requesting deletion of his name as accused came to be dismissed by reasoned order by the Trial Court on 28.02.2006.
3.1 Mr.K.I.Patel, learned advocate for the respondent no.2 submitted that despite the fact that the criminal complaint is pending since the year-2003, the applicant-original accused no.3 till date never attended the trial Court and the old proceeding is delayed because of non-cooperation by the applicant. It is further submitted that the instant complaint being private criminal complaint disclosing the warrant triable case, instituted otherwise than on police charge-sheet, the complainant shall adduce his evidence under Section 244 of the Code of Criminal Procedure. It is submitted that though in complaint, basic avernments, which are necessary to suggest the involvement of the applicant in the offences have been made but, even before framing the charge, the complainant has an opportunity to lead more evidence and to produce more documents. It is, therefore, submitted that, at this stage, that too, when even otherwise the stage of leading pre-charge evidence by the complainant has not been exhausted, it would be too premature to quash the criminal complaint at this stage in this petition. Therefore, it is submitted that petition may be dismissed.
Mr.K.P.Raval, learned Additional Public Prosecutor for the respondent no.1-State submitted that since in the year-2003, the Trial Court entrusted the inquiry to the police under Section 202 of the Code of Criminal Procedure, the police promptly responded to said order and the out-come of its inquiry report came to be accepted by the Trial Court. It is, therefore, submitted that no illegality can be said to have been committed by the Trial Court.
Now, at the out-set, perusing the copy of private complaint, it appears that Company is joined as accused no.1, its Executive Director is joined as accused no.2 and the applicant who is described as Vice President of the Company is joined as accused no.3.
Considering the private complaint, it is alleged by the respondent no.2-original complainant that though on 21.12.1998, draft of Rs.52,831/- was sent to the accused-Company and again on 29.12.1998, draft of Rs.1,00,000/- was sent to the accused-Company in connection with the order placed by the complainant for the goods, cement etc., the accused did not deliver the goods to the complainant, but on the contrary appropriated the amount of draft in the account of some another Company. The complaint was filed on 12.09.2002 and the same was sent for inquiry to police under Section 202 of the Code of Criminal Procedure. It is true that the complaint came to be filed alleging offences punishable under Sections 420, 477-A read with Section 114 of the Indian Penal Code but, upon receipt of the police report pursuant to the inquiry under Section 202 of the Code of Criminal Procedure, vide order dated 24.04.2003, the Trial Court issued processes against all the three accused including the applicant for the offence punishable under Section 406 read with 114 of the Indian Penal Code. Relying upon the Section 405 of the Indian Penal Code, at this stage, much is said on behalf of the complainant that the required ingredients for the offence of criminal breach of trust as defined under Section 405 of the Indian Penal Code, cannot be said to have been prima-facie made out, but at this stage, the bare perusal of the complaint would suggest that as per the allegation of the complainant though, he sent the money for the delivery of the goods, not only the goods were not delivered to him, but his money was appropriated by the accused not towards the price for the delivery of the goods but, in the account of some another Company. More over, as submitted by Mr.Patel, learned advocate for the respondent no.2-complainant, the instant complaint case can be termed as "warrant triable case arising otherwise than on police charge-sheet. Under such circumstances,the Trial Court has yet to record evidence, if any, to be adduced by the complainant under Section 244 of the Code of Criminal Procedure i.e. pre-charge evidence. Therefore, after said evidence would be adduced by the complainant, then there would be the stage for framing charge under Section 245 of the Code of Criminal Procedure. At that stage, if at all the applicant feels that the offences cannot be said to have been prima-facie established then, he has a right to apply for discharge. Under such circumstances, at this stage, it would be too premature to conclusively hold that no offence punishable under Section 406 of the Indian Penal Code is prima-facie made out.
It is true that as per the defence of the applicant and as prima-facie supported by the appointment order Annexure-C, the applicant came to be appointed as Senior General Manager (Commercial) in the accused Company on 06.07.1998. It further transpires that the normal work place was at Digvijay Gram, Dist:Jamnagar. Mr.A.R.Gupta, learned advocate for the applicant relied upon the transfer order-Annexure-D, whereby with effect from 28.08.1999, the applicant came to be transferred to Ahmedabad office of the Company. It is submitted that, therefore, in the year-1998, he was not in Ahmedabad office itself, and therefore, the complainant, in his complaint, wrongly involved the applicant for the alleged offence, allegedly committed by the Ahmedabad office of the Company prior to the year-1999. Now, on this count, it is pertinent to note that in the complaint, the applicant is arraigned as co-accused in the capacity as Vice President of the Company. More over, he was inducted in the Company as seen above since 06.07.1998. He was appointed as Senior General Manager (Commercial), and only his ordinary place of work was at Digvijay Gram, Dist:Jamnagar, but otherwise the services were liable to be transferred to any place. More over, at the cost of repetition, it is further submitted that the pre-charge evidence is yet to be adduced by the respondent no.2-Complainant and after said evidence is adduced, at an appropriate stage, the applicant can apply for appropriate relief but, at this stage considering the avernments made in the complaint, it cannot be said that the applicant is prima-facie not responsible.
It would be necessary to consider the decisions relied upon by Mr.Gupta, learned advocate for the applicant, on the issue of vicarious liability. If facts of Maksud Saiyad's case (Supra) are considered, it has been observed by the Hon'ble Apex Court that in the criminal prosecution, it has not at all been clarified as to who had acted on behalf of the bank and the said fact was not at all disclosed. In M.A.A.Annamalai (Supra), the appellant had admittedly ceased to be Director of the company prior to the date of the alleged offence. Even the respondent no.2 therein who was the original complainant submitted a writing to the effect that he did not want to proceed against the appellant because according to him, the appellant had been inadvertently included as an accused by the Investigating Officer. Thus, in the peculiar facts and circumstances the case, as emerged from the aforesaid decisions, the Hon'ble Apex Court observed that the prosecution against the Director deserved to be quashed and set-aside.
In Sharon Michael's case (supra), in the facts and circumstances of the case, the Hon'ble Apex Court observed that an accused cannot be made liable only because he happened to be an employee of the Company. There cannot be any dispute regarding the proposition propounded by the Hon'ble Apex Court in the aforesaid case, but in the instant case, perusing the complaint, at this stage, it cannot be conclusively said that the applicant-accused no.3 is joined as co-accused only because he happened to be an employee of the Company.
Considering the affidavit filed by the respondent no.2-original complainant, it emerges that, in past, the accused no.1-Company had preferred the petition under Section 482 of the Code of Criminal Procedure requesting quashing this complaint qua it and this Court vide order dated 24.01.2005, dismissed the said petition. Mr.A.R.Gupta, learned advocate for the applicant submitted that the order dated 24.01.2005, cannot be looked into, as this order can be termed as per in-curiam and for that purpose, my attention was drawn to the case of Assistant Commissioner, Assessment-II, Banglore (Supra) decided by the Hon'ble Apex Court on 16th September,2003. It has been observed per majority that since a Company is incapable of imprisonment, such prosecution is not maintainable and Court cannot on its own substitute a fine for mandatory imprisonment. Therefore, it is submitted that learned Single Judge while disposing of the quashing petition by order dated 24.01.2005, failed to take into consideration this decision of the year-2003, rendered by the Hon'ble Apex Court, and therefore, this order dated 24.01.2005 can be termed as per in-curiam. Further, Mr.A.R.Gupta, learned advocate for the applicant submitted that subsequently in the case of Standard Chartered Bank (Supra), the earlier decision of the year-2003, came to be overruled by the Hon'ble Apex Court, and therefore, this order dated 24.01.2005 can be termed as per in-curiam. Though, Mr.A.R.Gupta, learned advocate for the applicant submitted that in the case of Standard Chartered Bank (Supra) the earlier decision of the year-2003 came to be over ruled in the year-2005, on 05.05.2005, but, on 24.01.2005, when learned Single Judge has dismissed the quashing petition of the Company, earlier decision of 2003 was holding the field. Now, in light of entire above discussions, the case of applicant-accused no.3 is independently discussed by this Court, in the instant order, and without having been any way influenced by the earlier order dated 24.01.2005, rendered by this Court in the petition filed by the Company. There is no dispute that the applicant herein was not one of the applicants in the said petition. More over, in the instant case, the important aspect, which is required to be considered is that Company itself is not the sole accused but, respondent no.2-complainant has joined along with the company its Executive Director and the Vice President as co-accused. However, the instant application is decided by this Court,uninfluenced by the fact that the quashing petition was filed by the Company and it came to be dismissed by this Court. When such is the situation and when the instant order is not based upon the said earlier order, the question as to whether the said order can be termed as per in-curiam or not loses its importance. However, so far as the instant application is concerned, it can safely be said that now the decision rendered by the Hon'ble Apex Court in case the of Standard Chartered Bank (Supra) holds the field and Assitant Commissioner, Assessment-II, Banglore's case (supra) decided by Hon'ble the Apex Court in 2003 is thereby, overruled. It is to be noted that so far as the instant application under Section 482 of the Code of Criminal Procedure is concerned, the company is not the applicant. Therefore, the above aspect of the matter is though not of much relevance in this application.
In the above view of the matter, this Court is of the opinion that the instant application whereby the request is made to quash and set aside the private criminal complaint under Section 482 of the Code of Criminal Procedure is devoid of any merits and deserves dismissal.
For the foregoing reasons, the application is dismissed. Notice is discharged.
(J.C.UPADHYAYA,J.) Girish Top