Allahabad High Court
Dhanush Vir Singh And Ors. vs The State Of U.P Thru Secy., Home Affair ... on 30 January, 2015
Author: Ravindra Singh
Bench: Ravindra Singh
HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH Reserved Criminal Misc. Case under section 482 Cr.P.C. No. 4707 of 2013 Dhanush Veer Singh and others Versus State of U.P. Hon'ble Ravindra Singh,J.
Heard Sri Prashant Chandra, Senior Advocative, assisted by Sri Mayank Sinha, and Sri D.K.Singh, learned counsel for the applicants, learned A.G.A. for the State of U.P. and Sri jyotindra Mishra, Senior Advocate, assisted by Sri Sunil Kumar Chaudhary and Sri Kapil Misra, learned counsel for respondent no. 2.
That the applicants Dhanush Veer Singh, Saurabh Bannerji and Pradeep Thakur have preferred this application under section 482 Cr.P.C. with the following prayers:
(a) To set aside order dated 5.4.2013 passed by the Ld. CJM, Lucknow in Complaint Case No. 2062 of 2013 and quash the complaint dated 25.2.2013 filed by the respondent no. 2 having Complaint Case No. 2062 of 2013 pending before the J.M. II, Lucknow; and
(b) Quash and set aside the order dated 17.9.2013 passed by the Ld. ASJ, Lucknow in Criminal Revision Petition No. 182 of 2013; and
c) Pass an ad-interim order staying the further proceedings in complaint Case No. 2062 of 2013 before the Ld. CJM, Lucknow; and
d) Pass any further order as this Hon'ble court may deem fit and proper in the facts and circumstances of the case.
The facts in brief, of this case are that respondent no. 2 Sri Satish Chandra Mishra, filed a complaint dated 25.2.2013 in the court of learned Chief Judicial Magistrate, Lucknow against the applicants on which the statement of respondent no. 2, Satish Chandra Mishra, was recorded under section 200 Cr.P.C. and the statements of Sri Amrendra Nath Tripathi, and Sri G.S. Tripathi, were recorded under section 202 Cr.P.C along with complaint , some documents and the photostate copy of the identity card issued as the member of Rajya Sabha to respondent no. 2 have also been filed. After considering the complaint, statements recorded under sections 200 and 202 Cr.P.C. and the documents filed, the learned Chief Judicial Magistrate, Lucknow took cognizance and summoned the applicants on 5.4.2013 to face the trial for the offence punishable under sections 500 and 501 I.P.C. The order dated 5.4.2013 was challenged by the applicants in the High Court by way of filing a criminal misc. case no. 1867 of 2013 under section 482 Cr.P.C., but the same was dismissed on 25.4.2013 on the ground of availability of alternative remedy by providing that in case any revision is preferred by the applicants before the court below, the revisional court shall dispose of the same by a reasoned and speaking order considering all the submissions raised before it. In pursuance of the order dated 25.4.2013, the petitioner preferred a Revision petition No. 182 of 2013 before the Sessions Court, Lucknow, the same has been dismissed on 17.9.2013 by the learned Additional Sessions Judge, Court No. 3, Lucknow. Being aggrieved, from the orders dated 5.4.2013 and 17.9.2013, the petitioners preferred this application under section 482 Cr.PC. before this court.
The respondent no. 2 Sri Satish Chandra Mishra, filed a complaint case no. 2062 of 2013 against the applicants on the basis of the news item published in the Daily News Paper ' The Times of India' on Wednesday, February, 6th, 2013, the news item was published permanently in all the editions to all the news papers throughout the country and it had also publicised in the website. It was published in Lucknow edition dated 6.2.2013 as the main headline on the first page. The following news item was published :
'BSP NETAS USED BANK TO LAUNDER CASH ' Case Filed Against Bank linked to RS MP Akhilesh Das Pradeep Thakur /Tnn New Delhi : The Reserve Bank of India(RBI) has filed a criminal case in Lucknow's chief judicial magistrate's court against directors and the CEO of a cooperative bank- Indian Mercantile Cooperative Bank Ltd- for alleged money laundering worth hundreds of crores involving fictitious entities.
The bank is linked to BSP Raj Sabha MP Akhilesh Das Gupta. His wife, Alka, a former head of the bank who is still on its board, has been made a respondent by the RBI. Some of the suspicious transactions involve BSP leaders. The BSP leaders have strongly disputed the contents of the report.
ToI has a copy of the Inspection report.
The case was taken up by other investigating agencies after intelligence Bureau, which ran its own checks, altered the finance ministry to a suspected money laundering racket running into thousand of crores.
In any case, RBI's findings were alarming enough, with the central bank reporting a series of transactions where crores were deposited and withdrawn, with the bank of allegedly failing to meet the requirement of checking the antecedents of the account holders.
The RBI report suspect that fictitious entities were engaged in transactions which in many cases involved more than Rs. 10 crores. Subsequent, efforts to trace the account holders failed.
Significantly, many of the transactions date to the BSP government in UP. One of these relates to BSP chief Mayawati's close aide Satish Chandra Mishra. The RBI report alleged that the bank provided undue benefits to the BSP leader in Rajya Sabha, foregoing a significant part of the Rs. 2 crore loan he was given. It is also alleged that Mishra was given the loan even when his papers were not in order and when he pledge a property different from the one which was supposed to be the collateral.
"The bank had sanctioned Rs. 2 crore but as per repayment scheduled, total recovery would be only Rs. 30 lakh in five years and for the same loan account the bank had not followed the share linking norms," the RBI inspection report said.
When contacted, Mishra strongly refuted the charge and threatened to proceed against RBI.
The BSP leader said he had taken a loan from the Indian Mercantile Bank and had mortgaged his Windsor Place property, the worth of which was more than the loan amount."
The above mentioned news item was published on the basis of the criminal case filed by the Reserve Bank of India (R.B.I.) in the court of learned Chief Judicial Magistrate, Lucknow against the director and CEO of Cooperative Bank - Indian Mercantile cooperative Bank Limited for the alleged money funding worth Rs. 100 crores involved fictitious entities.
The criminal complaint dated 30.6.2012 has been filed by the Reserve Bank of India through Sri Goresh Rama Kotian, Deputy General Manager Urban Bank Department Reserve Bank of India, Lucknow against the Indian Mercantile Cooperative Bank Limited, Sri Raj Kumar Ram, Sri Amit Srivastava, Sri Rakesh Mohan Garag, Sri Manveer Singh, Smt. Phoolmati, Sri Swardhan Singh, Sri Dharam Singh, Smt. Sonu Malhotra, Sri Harun Ali, Sri Sudharma Singh, Sri Krishna Gopal Savita, Sri Dileep Singh and Arun Gupta, Sri Dinesh Behari Srivastava, Sri C.P.Shukla, Sri Ashok Gupta, Sri Rajeev Bajpai, Sri V.P.Sinha, Smt. Mithlesh Sinha, Sri Amreshwar Gupta, Smt. Sandhya Gupta Smt. K. Agarwal, Sri Ramesh Yadav, Smt. Alka Dass and Shouryavardhan Singh and the complaint has been lodged on the basis of the inspection of the cooperative Bank. The complaint is containing 24 paras including the prayer, but the name of respondent no. 2 has not been referred therein in any manner and the complaint is silent with regard to the news item published. The complaint has not been filed against the respondent 2 whereas it has been filed against 26 persons. The 'note' of inspection shown under section 35 of the Banking Regulation Act, 1949 (As applicable Cooperative Societies), Indian Mercantile Cooperative Bank Limited, Lucknow U.P. has been filed along with the complaint in which the name of respondent no. 2 is given. The inspection report has been filed along with this application as annexure no.2, is being reproduced as under :
"Inspection under section 35 of the Banking Regulation Act,1949(As applicable to Co-operative Societies)-Indian Mercantile Co-operative Bank Ltd., Lucknow (UP)
1. Introduction and Overview 1.1An inspection of the Indian Mercantile Co-operative Bank Ltd, Luckow under Section 35 of the B.R. Act 1949(AACS), was conducted with reference to its financial position as on March 31, 2009. For this purpose, the Head Office and seven branches of the bank were inspected from June 1 to July 17 2009. The bank was last inspected with reference to its financial position as on March 31, 2008. Particulars of important items of Liabilities and Assets as on the date of last inspection/last financial year and on the date of present inspection have been furnished in Annex 1. The developments in the affairs since the last inspection have been reviewed in the inspection report.
1.2Shri Raj Kumar Ram had been the chairman of the bank from December 20,2001 till reference date.
1.3Shri VP Sinha continued as the Secretary /CEO of the bank since the inception of the bank.
1.4The bank was having 9 branches and one extension counter as on the date of last inspection. The composition of the branch network had not undergone any change during the period under review.
1.5The bank was registered as a co-operative society on March 08, 1989. It was given license to commence and carry on business by RBI on May 09, 1989.
2Assessment of Net worth:
2.1Paid up share capital:
The paid up share capital(at book value) stood at Rs 1115.85 lakh as on the date of present inspection posting an increase of Rs 81.49 lakh(7.88%) since the date of last inspection when it stood at Rs 1034.36 lakh. The bank's track record in adhering to RBI norms on share linking to borrowings was not satisfactory. It had collected share money by debiting loan accounts in large number of cases. It had also collected less amount of share money in the loan a/c of Pragya Ghosh, DV Mahendru etc. The bank had not collected any share money in case of TL to Shri Satish Chandra Mishra. Movement in the bank's share capital during period under review was as under:
(Rs. In lakh) Paid Share Capital as on the date of last inspection 1034.36 Addition to Share Capital since the date of last inspection 94.56 Deduct: Repayment/Adjustment 13.07 Paid up share capital as on the date of present inspection 1115.85 (Action) 5.2 Size and composition of loan portfolio:-
Advances of the bank had gone up from Rs. 10493.51 lakh as on the date of last inspection to Rs. 12469.57 as on the date of present inspection. The composition of advances portfolio as on 31.03.2008 (DLI) and on the date of present inspection as reported by the bank was as under:-
(Rs. In lakh) Composition of loan portfolio 31.03.2008 31.03.2009 Retail Trade 2865.00 2713.29 Small Scale Industries 1765.00 1233.48 Other Priority sector 4687.10 3535.29 Medium and Large Industries
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Other non Priority Sector 1176.41 4987.51 Total 10493.51 12469.57 As per the date furnished by the bank priority sector advances stood at Rs 7482.06 lakh as on 31.03.2009 constituting 51.47% of total adjusted bank credit as on 31.03.08 but the present inspection had assessed the advances to priority sector at Rs 3363.82 lakh constituting 23.14% against stipulated 40% of adjusted bank credit(ABC) as on 31.03.2008. The Inspection had deducted fake loans to the tune of Rs 4118.24 lakh, detected during the course of inspection, classified by the bank as priority sector advances and hence the difference. (Action) 5.3 System and quality of credit appraisal:-
i.There was no system of credit appraisal in the bank. While arriving at credit requirements of the borrowers feasibility of the activity to be financed repaying capacity of the borrowers etc. were not considered. It had not taken into account the repaying capacity of the borrowers while fixing EMIs for housing loans. In case of housing loans the bank had neither insisted for ''no objection certificate' from the municipal authorities nor done ''pre-sanction' inspection. At bank's Cantt. Branch, loans were sanctioned without ascertaining the genuineness of purpose for which they were sought. Loans were not sanctioned on bank's loan application. They were sanctioned through office note/ orders. Purpose of loan was mentioned as ''expansion of business' or ''for business' in most loan application at bank's Cantt branch. It appeared that most of the loans applications were filled in by same (set of) persons as the handwriting on applications was almost similar. No pre sanction/ post sanction inspection was undertake. KYC norms and relevant credit information with regard to borrowers / guarantors were not fulfilled / obtained. Ex. S. Gupta Buildtech Limited, Viraj Prakashan Pvt Ltd, Shri Satish Chandra Mishra(TL RS. 200.00lakh) etc. It may not be out of place to mention here that the bank reluctantly provided files of large borrowers accounts with inordinate delay and it was also apprehended that bank had utilized the time to prepare the files and relevant papers.
ii.It was observed that prior to February 2008 the bank had generally sanctioned unsecured loans. Thereafter, it the bank started obtaining Fixed Deposit Receipts(FDRs), the average value of which were around 35 to 40% of loan amount in each case. These deposit holders were mostly third parties who apparently had no stake in the loan. In majority of the cases, letters of Pledge of FDRs or letters of lien and set off were either left blank or not signed by deposit holders. KYC formalities were not completed in respect of borrowers / guarantors/ third parties. Rate of interest applied for the same type of loan of same amount sanctioned on different dates. In some cases, the applicable rate of interest in the computer system differed from charged in the loan account eg. Shri Satish Chandra Mishra (TL Rs. 200.00lakh). It was also observed that interest rate charged in most of loan accounts was different for different months though there was no change in interest rates of the bank.
iii.The Noida branch was allowing unrestricted withdrawals to various current account holders eg Jyoti Build Tech Pvt. Ltd -O/s debit balance701.52lakh on march 02,2009,R.D. Foundation-O/s debit balance s Rs. 144.98 lakh on 14.07.09, Tirupati Construction- O/s debit balance of Rs 128.69 lakh on 14.07.09 etc . However, the debit balances in these current accounts were somehow brought to credit balance as on the date of balance sheet and thereafter overdrawings were allowed again by the bank. Equitable mortgage was not created on the land purchased by the borrower. Ex S. Gupta Build Tech Limited, Viraj Prakashan Pvt. Ltd, Lord Ganesha Hospitalities(p) Ltd. In case of proposals for cash credit limits the bank did not obtain required financial statements from the borrowers and in most of the cases and wherever submitted they were not subjected to any analysis. Letter of contract was not being obtained from the contractors before extending them credit facility. Similarly, in case of loan to builders an ''NOC' from the concerned authority, detail of acquisition/ nature of land etc was not being obtained. In case borrowers availed loans from other banks, the bank did not obtained confidential report from the concerned bank regarding the conduct of the account. Ex. Viraj Prakashan Pvt. Ltd, shri Satish Chandra Mishra. The bank had not obtained board resolution of the companies for raising loans. Eg. Lord Ganesh Hospitalities(p) Ltd., Kabir Securities and services Pvt Agriculture land was kept as security in a few cases eg Ghaziabad Eco Friendly, Lord Ganesh, Viraj Distributors, Viraj construction, Hitech protection India Pvt. Ltd.etc. The property papers obtained was different from the property mortgaged Shri Satish Chandra Mishra(TL Rs. 200.00 lakh), S. Gupta Buildtech Ltd etc. Non encumbrance certificate and valuation report were not obtained in a number of case of loan against property and others at Noida branch eg Shri Satish Chandra Mishra (TL Rs. 200.00 lakh), The System of communicating terms and conditions or the loans sanctioned to the borrowers was not in vogue. It was observed in one TL account (Shri Satish Chandra Mishra) that the bank had sanctioned Rs. 200.00 lakh but as per repayment schedule total recovery would be only Rs 30.00 lakh in 5 years and for the same loan account the bank had not followed the share linking norms. (Action)"
The complaint of the present case has been filed by respondent no. 2 against the applicants in respect of the said news item published relating to the filing of a case by the Reserve Bank of India against the Indian Mercantile Cooperative Bank Ltd. and others. The reference of an inspection report of the Reserve Bank of India has been made, which was ex parte because respondent no. 2 was never confronted with any objection with regard to the loan taken by him from the Bank, the news item has been published relating to the filing of the criminal case by the Reserve Bank of India, in which respondent no. 2 was not made the party, the imputation of a Box attached to the news item in question shows the photograph of a bundle of currency notes as well as the sentence quoted therein that case was taken up by other Investigating agencies after intelligence Bureau, which ran its own checks,altered finance ministry to a suspected money laundering racket running thousands of crores,The name of respondent no. 2 has been referred therein in a painted and tainted manner which relates to the loan amounting to Rs. 2 crores, which was borrowed by him from the Indian Mercantile cooperative Bank Limited on 21.7.2008 and had already been repaid to long time ago on 31.5.2010, the said news item definitely lower down the reputation of respondent no. 2, it gave the impression to the readers of the news paper that, the respondent no. 2 had used the cooperative Bank for laundering the cash. but filing of the criminal case by the Reserve Bank of India against the Indian Mercantile Cooperative Bank, is not connected with respondent no. 2 in any manner whatsoever. but by imputation innuendo, the applicants have knowingly published the same news item in a tinted other than the correct facts, the publication of the said news item giving the tint other than the correct facts. The publication of the said news item, has damaged the reputation of respondent no.2. The applicant no. 1 is the Printer and Publisher of the said news item, applicant no.2 is the Editor of the said news papers and applicant no. 3 is the Correspondent of the said news item in question, for time news network. The said news item,has harmed and injured the reputation of respondent no. 2, it is a defamatory. A few days before the publication of the news item, applicant no. 3 had made query on telephone from respondent no. 2 about the allegation relating to loan account, he was duly informed the entire details. Applicant no. 3 had expressed surprise on even reference of respondent no. 2's name in the inspection report of R.B.I. which was based on incorrect facts and he himself had suggested respondent no. 2 to take legal and penal action against the R.B.I. for placing such incorrect facts in the inspection report. Thereafter, applicant no.3 deliberately,intentionally and malafidely with the sole deliberate intention of defaming respondent no. 2 got published the defamatory news item by camouflaging news picturing as if respondent no.2 had indulged in money laundering through bank cash. The allegation that even the property was mortgaged in stead of the property against which the loan was taken is totally incorrect, false and mischievous. Similarly, even though as per the agreement, respondent no. 2 had to pay Rs. 54 lacs within a years by paying Rs. 4 lacks, 50 thousand per month as instalment , the news item published that respondent no.2 had paid only Rs. 30 lakhs in five years is apparently false and incorrect because the entire loan amount was payable within five years. The news papers are required to publish, fair accurate, unbiased, with sober news item in a decent manner. However, right to preservation of reputation is right in rem and therefore, respondent no. 2 has a right to preserve his reputation in any case. A bare perusal of the news item would show that it has been deliberately and intentionally tinted with incorrect facts as if the complainant is laundering the cash with the help of the bank. According to applicant no. 3 himself R.B.I. has not been able to controvert with the fact revealed by respondent no.2, in such a situation applicants should have desisted from the publishing the news item on respondent no. 2. The heading of the said news item is highly defamatory to respondent no. 2, inasmuch as the name of respondent no. 2 appears several times in the news item while the news time in question indicates that thousands of crores of the money has been laundered while respondent no. 2 has borrowed only an amount of 2 crores from the Indian Mercantile Cooperative Bank Limited, which had been paid back to the bank within one year and ten months, which was much earlier than the stipulated time. The defamatory news item has been published deliberately, knowingly and intentionally to impute the reputation of respondent no. 2 in public at large, such imputation is directly lowered the reputation of respondent no. 2 in the estimation of public at large. In order to defame the complainant by fully knowing and having good reason to believe that the matter being published is defamatory to the complainant,the publication has made made. The publication has harmed the reputation of the complainant very seriously at State level and National level. The publication of the news item concerning the complainant, has the effect of lowering his credit. The news item published in the news paper making imputation of the complainant is neither true nor it can be termed to be good, by the publishing such a news item, the offence enumerated under section 499 I.P.C. punishable under sections 500 & 501 I.P.C. has been committed by the accused persons. Along with the complaint dated 25.2.2013, some documents as the photocopy of the statement of account, photocopy of the certificate dated 20.3.2013 issued by the Indian Mercantile Bank, photocopy of the certificate dated 30.3.2012 issued by the Union Bank of India, original news paper. 'The Times of India' dated 6.2.2013, photocopy of the surety bonds, photocopy of the letter dated 5.9.2009 and photocopy of the No Objection Certificate dated 1.6.2010 were filed by the complainant. The photocopy of the identity card issued by Raja Sabha was also filed by the complainant.
It is submitted by the learned counsel for the applicants that the Reserve Bank of India is an statutory body established by the Reserve Bank of India Act 1934 conducting the statutory inspection of the Indian Mercantile Co-operative Bank, Cantt. Road, Lucknow under section 35 read with section 56 of the Banking Regulation Act, 1949 with reference to its final position as on March, 21, 2009, March 31st, 2010, March 31st 2011 from June 1st, 2009 to July 17th, 2009,September, 13, 2010 to October 15, 2010, September, 8, 2011 to October 1st, 2011 respectively. In these inspection R.B.I. had found that the Indian Mercantile Co-operative Bank Limited has committed several grave and serious irregularity, omission and commission including the income leakage syphoning misappropriation of bank fund but the R.B.I. also conducted the special audit of the said bank and prepared the report dated 10.3.2011. On the basis of the aforesaid inspection report and audit report, the Reserve Bank of India had filed criminal case no. 4202 of 2012 in the court of learned Chief Judicial Magistrate against the Indian Mercantile Co-operative limited, its Chairman, Vice Chairman & 23 Directors under section 46 read with section 46A of the Banking Regulation Act and sections 120-B, 166,167,409,465,468,418 I.P.C. the same is pending in the court of learned Chief Judicial Magistrate, Lucknow in which 'inspection report' and audit report were part of the list of documents. The inspection report 2008-09 was also filed along with the criminal complaint dated 30.6.2012 and it was the record of court proceedings in which it was mentioned as under :
"2.1Paid up share capital:
The paid up share capital(at book value) stood at Rs 1115.85 lakh as on the date of present inspection posting an increase of Rs 81.49 lakh(7.88%) since the date of last inspection when it stood at Rs 1034.36 lakh. The bank's track record in adhering to RBI norms on share linking to borrowings was not satisfactory. It had collected share money by debiting loan accounts in large number of cases. It had also collected less amount of share money in the loan a/c of Pragya Ghosh, DV Mahendru etc. The bank had not collected any share money in case of TL to Shri Satish Chandra Mishra."
It has also been mentioned therein that no pre-sanction/post sanction inspection was undertaken. The KYC norms and relevant credit information with regard to the borrowers/guarantors were fulfilled/obtained Ex. S. Gupta Buildtech Limited, Viraj Prakashan Pvt Ltd, Shri Satish Chandra Mishra(TL RS. 200.00lakh) etc. It has also been mentioned in the inspection report that rate of interest applied differed for the same type of loan of the same amount sanctioned on different dates. In some cases, the applicable rate of interest in the computer system differed from the loan sanctioned note loan agreement. In some other cases even lower interests were charged eg. Shri Satish Chandra Mishra (TL Rs. 200.00lakh), at some places it has been mentioned that in cases the borrowers avail loan from other bank, the bank did not obtain confidential report from the concerned bank regarding the conduct of banking account ex Viraj Prakashan Pvt. Ltd, Shri Satish Chandra Mishra and on some other places it has been mentioned that property papers obtained were different from the property mortgaged. Shri satish Chandra Mishra(TL Rs. 200.00 lakh), S. Gupta Buildtech Ltd etc. Non encumbrance certificate and valuation report were not obtained in a number of cases of loan against property and others at Noida branch eg Shri Satish Chandra Mishra (TL Rs. 200.00 lakh). It was also observed that in one of T.L. account of Shri Satish Chandra Mishra the bank had sanctioned Rs. 200.00 lakh but as per repayment schedule total recovery would be only Rs 30.00 lakh in 5 years and for the same loan account the bank had not followed the share linking norms.
The applicant no. 3 found that there were serious allegation in R.B.I. Inspection report with respect to linking of the complainant with the Indian Mercantile Cooperative Bank. The complainant is a main political figure and top leader of Bahujan Samaj Party. The applicant no. 3 was having duty in public interest to report the matter with respect of the allegation in respect of the complainant-respondent but before publishing the allegation contained in the R.B.I. Inspection Report which form part of the record of the judicial proceedings, petitioner no. 3 was diligent, careful enough in contacting the complainant, and put to him the allegation in respect of the loan taken by him from the Indian Mercantile Cooperative Bank Limited and tried to obtain complainant's response in respect of the allegation concerning with him and after soliciting the response from the complainant, the applicant No. 3 contacted the Reserve Bank of India and put the response of the complainant in respect of the allegation concerning him, however, the R.B.I. refused to respond on the response of the complainant on the ground that the matter was subjudice. After thorough examination, the important news item in question, was published in The Times of India, news paper Lucknow Edition on 6th February, 2013. The the news item published cannot be said to be defamatory, because it is based on the record of judicial proceedings and the writing of the news item in question does not give any impression that it was actuated by any malevolent or the report was figment of imagination with a desire to calumniate or cast aspersions on the complainant without there being any basis. The publication in the news item is based on the record of court, if some passage in written matter is alleged to be defamatory, the documents should be read as a whole with a view to find out the main purport too much importance should not be attached with a few isolated passages here. It is the context that is important not the actual words used. The headline of the news item was also based on the contents of the inspection report of R.B.I. which was a part of the record. The news item in any case is not defamatory. The complaint, document filed along with the complaint, the statement of the complainant recorded under section 200 Cr.P.C. and the statements of the witnesses recorded under section 202 Cr,P.C. are not prima facie constituting the offence publishable under sections 500,501 I.P.C. The defamation is defined under section 499 I.P.C. The news item in question is covered by the fourth exception of the Section 499 I.P.C. The freedom of speech and expression is also guaranteed under Article 19(1) of the Constitution of India. The legitimate function of the news papers in democratic set up is to act as a champion of clean administration and sentiment of the public interest and as such the applicants were well within their rights to expose and bringing to the notices of general public any lapse or malpractice in the administration including that of Nepotism and favouritism, by doing so the applicants acted for publishing the good and a substantial true news item had been published for public good, no criminal prosecution may be done.
The mere publication of an imputation by itself may not constitute the offence of defamation unless such imputation has been made with the intention, knowledge or belief that such imputation will harm the reputation of the person concerned. The publication of the news item is verbatim reproduction of RBI's inspection report which is part of Court proceedings, infact words in the article make out only a fair comment in god faith and in public interest. The complaint on the face of it, does not make out the prima faie case against the applicants and it is a complete abuse of the process of the court and law, the same is lilable to be quashed.
The learned C.J.M.Lucknow, without even perusing the publication in its entirety and without realising that it is a news of public good/public importance and without perceiving the public purpose as it was related to the state of affairs of a Bank and that publication did not relate to any opinion or comments, in which factual aspects were published has taken the cognizance by passing the impugned order dated 5.4.2013 which is illegal and liable to be set aside. The revisional court also dismissed the revision on 17.9.2013 without considering the provision of Indian Penal Code and without going through the record. The order dated 17.9.2013 has been passed in a mechanical manner, it is not reasoned and speaking order, even the submission raised by counsel for the applicants were not considered. The revisional Court has also committed a manifest error in passing the impugned order dated 17.9.2013, in such a circumstance, both the impugned orders dated 5.4.2013 and 17.9.2013 are illegal and liable to be set aside. The complaint dated 25.2.2013 filed by respondent no. 2 in Complaint Case No. 2062 of 2013 is misuse of the process of law, the same may also be quashed.
The counsel for the applicants has referred the following decisions :-
(1991) Supp.(2) SCC 329-Dr. Dhanwanti Vaswani vs. State and Anr., (1998) 4 SCC 112 Jawaharlal Darda and Ors. vs. Manoharrao Ganpatrao Kapsikar and Anr., (1996) 20 ACR 808 Santosh Tewari and ors. State of U.P. and Anr., (Ald. High Court), (2007) 15 SCC 631 N. Ravi and ors. Vs. Union of India and ors., 2000 Cri LJ 3118, N. Ram Vs. Siby Mathew and Anr., 2008 Cri.L.J. 4221 V.S.Achuthananandan vs. G. Kamalamma and Anr. 1950 Cri L.J. 1293 Radha Govind vs. Saila Kumar Mukherjee, 1968 Cri LJ 836 Shivage Gowda vs. T. Narayana, and another, (2010) 6 SCC 243 Jeffrey J. Diermeier and anr. vs. State of West Bengal and anr. , (1994) 6 SCC 632 R. Rajagopal alias R.R.Gopal and Anr.vs. State of Tamil Nadu and others, ( 2011) 13 SCC 155 Sanjoy Narayan , Editor-in-Chief, Hindustan Times and ors. vs. High Court of Allahabad, through Registrar General. AIR 1950 S.C. 124 Romesh Thappar Versus State of Madras, (2010) 15 SCC 163- Rajesh Rangarajan Vs Crop Care Federation of India and Anr.(2010) 15 SCC 163: Rajendra Kumar Sitaram Pande and Ors Vs. Uttam and Anr., N. Ram, Editor in Chief and Published of the Hindu and others Versus Rashtriya Swayamsewak Sangh, decided on 7.5.2012 by Panjab and Haryana High Court; 2010 Legal Eagle(Bom) 727 S. Khushboo Vs. Kannianmmal and another; 2010 Legal Eagle( AP) 120- Ravi Prakash Vs. J.C. Diwakar Reddy; 2010 Legal Eagle( AP) 45 Reporter Eenadu Daily Vanasthalipuram Vs. Sahara India Commercial Corporation; 2012 Legal Eagle(P&H) 573 N.Ram, Editor-in-Chief & Publisher of' The Hindu' & ors. Vs. Rashtriya Swayamsewak Sangh, Haryana Prant, through its Prant Sangh Chalak; 2005 Legal Eagle( Kar) 240,Editor, Deecan Heralt Vs. Prof. M.S. Ramaraju; 2002 Legal Eagle ( AP) 1182 A.T. Jayanthi Versus State of A.P.; 2002 Legal Eagle( Kar) 381 T. Satish U. Pai Vs. Narayan Nagappa Nayak; 2000 Legal Eagle( Pat) 360, Uttam Sengupta and Ors. Versus Bihar Public Service Commission and another,(2009) 2 SCC 370 Dhariwal Tobacco Product Limited and Ors. vs. State of Maharashtra and anr., (1997) 4 SCC 241 Krishhnan and Anr. vs. Krishnaveni and anr., ( 2009) 3 SCC 310 Shakuntala Devi and Anr.Vs. Chamru Mahto and Anr. (1998) 7 SCC 698 Ashok Chaturvedi and Ors. Vs. Shitul H. Chanchani and Anr., (1998) 5 SCC 749 Pepsi Food Ltd. And Anr. Vs. Special Judicial Magistrate and Ors.
In reply of the submission made by counsel for the applicants, it is submitted by the learned A.G.A.and the counsel for respondent No. 2 that respondent no. 2 is designated Senior Advocate, former Chairman, Bar Council of U.P., former Advocate General U.P. , he is Member of Parliament (Rajya Sabha) and is also holding the Post of National General Secretary of Bahujan Samaj Party and leader of B.S.P. legislature Party in Rajya Sabha. He is having a good reputation in the Society. In the Lucknow Edition of Times of India, News Paper, it was published in main headline of the first Page ' BSP Netas used bank to launder Cash' . The said news item was related with a case filed by Reserve Bank of India against Indian Mercantile Cooperative Bank Ltd.in which the complainant ( Respondent No. 2 ) was not a party. The name of the complainant appeared several times in the news item in question, although with the reference of some inspection report of the Reserve Bank of India which was annexed with complaint, it was ex parte report because the complainant was never confronted. In case filed by Reserved Bank of India against the Indian Mercantile Cooperative Bank Ltd in the court of learned C.J.M. Lucknow, the complainant was not made a party even in that complaint, the name of the complainant was not referred but an imputation of a box attached to the news item in question was showing the photograph of bundle of currency notes as well as sentence quoted herein- ' " The case was taken up by other investigating agencies after Intelligence Bureau, which ran its own checks, altered the Finance Ministry to a suspected money laundering racket running into thousands of crores. ", it was not part of R.B.I.'s inspection report The said news item, since bears the name of the complainant in a painted and tainted manner, only in relation of a loan amounting to Rs. 2 Crores borrowed by him from the Indian Mercantile Cooperative Bank Ltd on 21.7.2008. The same was already repaid long time ago on 21.5.2010, the said news item in question has definitely lowered down the reputation of the complainant. The relevant news item in question from the headline and tainted news item has gathered an impression as if the complainant has been using the Indian Mercantile Cooperative Bank Ltd for laundering the cash. It is surprising that the wording of the head line of the news item was not part of complaint and documents filed by the RBI in the court of C.J.M.The contents of box published in news item are not part of record. The applicants have published the news item in question for giving the tint other than correct facts,it has damaged the reputation of the complainant heavily, the publication is based on false and incorrect facts. A few days before the publication of the news item, the application No. 3 had made query on telephone from the complainant about the allegation relating to the loan account of the deponent, he was duly informed about the entire detail but by concealing all, deliberately, intentionally and malafidely with the sole intention to defame the complainant news item by camouflaging and picturing as if the complainant had indulged in money laundering through Bank Cash, was published. The complainant had taken the loan from the Indian Mercantile Cooperative Bank Ltd in accordance with rules. There was agreement of mortgage dated 21.7.2008. The property was mortgaged for taking the loan. The loan was taken by complainant with a condition to pay the loan in five years but the complainant had paid the same within one year and 10 months along with entire interest, after which the mortgaged property was released and the original documents were returned, no objection certificate was also issued on 1.6.2010. The news papers are required to publish in a fair , accurate, unbiased with sober news item in a decent manner. However, the right to preserve the reputation is right in rem. The complainant had right to preserve his reputation and in case of diminishing his reputation by any one else, he is having right to make complaint against such person. The manner in which news item in question was published, was to defame the complainant. It was not published for public good or in good faith. The learned C.J.M.Lucknow has passed the impugned order dated 5.4.2013 after going through the record and had recorded the finding that prima facie the offence punishable under sections 500 and 501 I.P.C.was made out and issued the summons to the applicants. The revisional Court has considered all the aspects of the case and after going through the record confirmed the order dated 5.4.2013 passed by C.J.M.Lucknow and dismissed the revision filed by the applicants on 17.9.2013. The order dated 5.4.2013 passed by C.J.M.Lucknow and order dated 17.9.2013 passed by learned Additional Sessions Judge, Court No. 3, Lucknow are not suffering from any illegality or irregularity. The learned C.J.M.Lucknow has issued the process after following the proper procedure prescribed by law and after going through the material available on record. The complaint is prime facie disclosing the commission of the offence punishable under sections 500 and 501 I.P.C., there was a sufficient ground for proceedings against the applicants by way of taking cognizance of an offence committed by the applicants. The impugned orders dated 5.4.2013 and 17.9.2013 are perfect orders, the complaint is also prima facie disclosing the offence. The present application is devoid of the merits, the same may be dismissed.
The counsel for respondent no.2 has referred the following cases :
(2010) 6 Supreme Court Cases 243 Jeffrey J. Diermeir and another vs. State of West Bengal and anr., 2012 ( 1) JIC- 11 ( Alld.) Sarvajeet Singh and others. Vs. State of U.P and another, 1996 Cri. L.J. 410 ( SC) State of U.P. Vs. Roop Singh others, 1999 Cri L.J. 4113 ( Alld. High Court) RT Arasu and others Vs. State of U.P.and another, (1999) 6 SCC 326- Rajathi Vs. C. Ganeshan, 1997( 4) SCC 241 Krishnan and another vs. Krishnaveni and another, (2009) 1 SCC 101 M.A Rumugam, vs. Kittu alias Krishnamoorthy, (2012) 9 SCC 460 Amit Kapoor Vs. Ramesh Chandra and another.
To deal with the issue involved in the present case, the provisions of Sections 499, 500 and 501 I.P.C.along with the provisions of Sections 200, 202 and 204 of the Code of Criminal Procedure, 1973 are required to be considered.
The sections 499, 500 and 501 I.P.C. read as under:
499. Defamation.--Whoever, by words either spoken or intended to be read, or by signs or by visible representations, makes or publishes any imputation concerning any person intending to harm, or knowing or having reason to believe that such imputation will harm, the reputation of such person, is said, except in the cases hereinafter expected, to defame that person.
Explanation 1.--It may amount to defamation to impute anything to a deceased person, if the imputation would harm the reputation of that person if living, and is intended to be hurtful to the feelings of his family or other near relatives.
Explanation 2.--It may amount to defamation to make an imputation concerning a company or an association or collection of persons as such. Explanation 3.--An imputation in the form of an alternative or expressed ironically, may amount to defamation.
Explanation 4.--No imputation is said to harm a person's reputation, unless that imputation directly or indirectly, in the estimation of others, lowers the moral or intellectual character of that person, or lowers the character of that person in respect of his caste or of his calling, or lowers the credit of that person, or causes it to be believed that the body of that person is in a loathsome state, or in a state generally considered as disgraceful.
First Exception.--Imputation of truth which public good requires to be made or published.--It is not defamation to impute anything which is true concerning any person, if it be for the public good that the imputation should be made or published. Whether or not it is for the public good is a question of fact.
Second Exception.--Public conduct of public servants.--It is not defamation to express in a good faith any opinion whatever respecting the conduct of a public servant in the discharge of his public functions, or respecting his character, so far as his character appears in that conduct, and no further.
Third Exception.--Conduct of any person touching any public question.--It is not defamation to express in good faith any opinion whatever respecting the conduct of any person touching any public question, and respecting his character, so far as his character appears in that conduct, and no further.
Fourth Exception.--Publication of reports of proceedings of Courts.--It is not defamation to publish substantially true report of the proceedings of a Court of Justice, or of the result of any such proceedings.
Explanation.--A Justice of the Peace or other officer holding an inquiry in open Court preliminary to a trial in a Court of Justice, is a Court within the meaning of the above section.
Fifth Exception.--Merits of case decided in Court or conduct of witnesses and others concerned.--It is not defamation to express in good faith any opinion whatever respecting the merits of any case, civil or criminal, which has been decided by a Court of Justice, or respecting the conduct of any person as a party, witness or agent, in any such case, or respecting the character of such person, as far as his character appears in that conduct, and no further.
Sixth Exception.--Merits of public performance.--It is not defamation to express in good faith any opinion respecting the merits of any performance which its author has submitted to the judgment of the public, or respecting the character of the author so far as his character appears in such performance, and no further.
Explanation.--A performance may be substituted to the judgment of the public expressly or by acts on the part of the author which imply such submission to the judgment of the public.
Seventh Exception.--Censure passed in good faith by person having lawful authority over another.--It is not defamation in a person having over another any authority, either conferred by law or arising out of a lawful contract made with that other, to pass in good faith any censure on the conduct of that other in matters to which such lawful authority relates.
.
Eighth Exception.--Accusation preferred in good faith to authorised person.--It is not defamation to prefer in good faith an accusation against any person to any of those who have lawful authority over that person with respect to the subject-matter of accusation.
Ninth Exception.--Imputation made in good faith by person for protection of his or other's interests.--It is not defamation to make an imputation on the character of another provided that the imputation be made in good faith for the protection of the interests of the person making it, or of any other person, or for the public good.
Tenth Exception.--Caution intended for good of person to whom conveyed or for public good.--It is not defamation to convey a caution, in good faith, to one person against another, provided that such caution be intended for the good of the person to whom it is conveyed, or of some person in whom that person is interested, or for the public good.
500. Punishment for defamation --
Whoever defames another shall be punished with simple imprisonment for a term which may extend to two years, or with fine, or with both.
501. Printing or engraving matter known to be defamatory --
Whoever prints or engraves any matter, knowing or having good reason to believe that such matter is defamatory of any person, shall be punished with simple imprisonment for a term which may extend to two years, or with fine, or with both.
The sections 200, 202 and 204 of the Code of Criminal Procedure read as under :-
Section 200 Cr.P.C.
200.Examination of complainant.- A Magistrate taking cognizance of an offence on complaint shall examine upon oath the complainant and the witnesses present, if any, and the substance of such examination shall be reduced to writing and shall be signed by the complainant and the witnesses, and also by the Magistrate:
Provided that, when the complaint is made in writing, the Magistrate need not examine the complainant and the witnesses-
(a) if a public servant acting or purporting to act in the discharge of his official duties or a Court has made the complainant; or
(b) if the Magistrate makes over the case for inquiry or trial to another Magistrate under section 192:
Provided further that if the Magistrate makes over the case to another Magistrate under section 192 after examining the complainant and the witnesses, the latter Magistrate need not reexamine them.
202.Postponement of issue of process.- (1) Any Magistrate , on receipt of a complaint of an offence of which he is authorised to take cognizance or which has been made over to him under section 192, may, if he thinks fit, postpone the issue of process against the accused, and either inquire into the case himself or direct an investigation to be made by a police officer or by such other person as he thinks fit, for the purpose of deciding whether or not there is sufficient ground for proceeding:
Provided that no such direction for investigation shall be made, -
(a) where it appears to the Magistrate that the offence complained of is triable exclusively by the Court of Session; or
(b) where the complaint has not been made by a Court, unless the complainant and the witnesses present (if any) have been examined on oath under section 200.
(2) In an inquiry under sub-section (1), the Magistrate may, if he thinks fit, take evidence of witnesses on oath:
Provided that if it appears to the Magistrate that the offence complained of is triable exclusively by the Court of Session, he shall call upon the complainant to produce all his witnesses and examine them on oath.
(3) If an investigation under sub-section (1) is made by a person not being a police officer, he shall have for that investigation all the powers conferred by this Code on an officer in charge of a police station except the power to arrest without warrant.
204.Issue of process.- (1) If in the opinion of a Magistrate taking cognizance of an offence there is sufficient ground for proceeding, and the case appears to be -
(a) a summons-case, he shall issue his summons for the attendance of the accused, or
(b) a warrant-case, he may issue a warrant, or, if he thinks fit, a summons, for causing the accused to be brought or to appear at a certain time before such Magistrate or (if he has no jurisdiction himself) some other Magistrate having jurisdiction.
(2) No summons or warrant shall be issued against the accused under sub-section (1) until a list of the prosecution witnesses has been filed.
(3) In a proceeding instituted upon a complaint made in writing, every summons or warrant issued under sub-section (1) shall be accompanied by a copy of such complaint.
(4) When by any law for the time being in force any process-fees or other fees are payable, no process shall be issued until the fees are paid and, if such fees are not paid within a reasonable time, the Magistrate may dismiss the complaint.
(5) Nothing in this section shall be deemed to affect the provisions of section 87.
Considering the submission made by the learned counsel for the applicants, learned A.G.A. for the State of U.P., learned counsel for the complainant, learned counsel for respondent no.2, the cases cited from both the sides and from the perusal of the record it reveals that respondent no. 2 Sri Satish Chandra Mishra filed a complaint dated 25.2.2013 in the court of learned Chief Judicial Magistrate, Lucknow for taking cognizance of the offence punishable under sections 500 and 501 I.P.C. and to punish the applicants for committing the above mentioned offences, along with the complaint, some necessary documents were also filed, thereafter, the learned Chief Judicial Magistrate, Lucknow recorded the statement of the complainant-respondent no. 2 Satish Chandra Mishra under section 200 Cr.P.C. and the statements of the witnesses Amrendra Nath Tripathi and G.S. Tripathi under section 200 Cr.P.C., after considering the same the learned Chief Judicial Magistrate,Lucknow took cognizance and summoned the applicants to face the trial for the offence punishable under sections 500 and 501 I.P.C. on 5.4.2013. The impugned order dated 5.4.2013 was challenged by the applicants before this court by way of filing criminal misc. case no. 1862 of 2013 under section 482 Cr.P.C., the same was dismissed, at that stage on the ground of availability of alternative remedy on 25.4.2013. In pursuance of the order dated 25.4.2013 the applicants filed criminal revision no. 182 of 2013, the same was dismissed by the learned Additional Sessions Judge, Court No. 3 Lucknow on 17.9.2013. The complaint has been filed by respondent no. 2 on the basis of the news item published in the 'Times of India' Lucknow Edition dated 6th February, 2013. The applicant no. 3 is the correspondent of the said news item in question for times news work. The applicant no. 2 is the Editor of the said news paper and applicant no. 3 is the Printer and Publisher of the said news paper. The issue involved in the present case is whether the news item in question is constituting the offence of defamation for which the applicants have been summoned by the Chief Judicial Magistrate, Lucknow. The said news item has been published on the basis of the inspection report of the Reserve Bank of India, which was made part of the record with the complaint dated 30.6.2012 filed by the Reserve Bank of India against 26 persons, in the court of the Chief Judicial Magistrate, Lucknow in criminal complaint no. 4202 of 2012. The complaint dated 30.6.2012 having 24 paragraphs including the prayer, is pending, it has not been filed against the complainant-respondent no. 2 Sri Satish Chandra Mishra, even in any of its paragraph the name of respondent no. 2 has not been referred and no allegation has been made against him whereas the complaint dated 30.6.2013 has been filed on the basis of Inspection Report and Audit Report, the Inspection Report has been filed as annexure No. 2 to the complaint, it is an exhaustive report in which the name of respondent no. 2 has also figured along with other persons but from the perusal of the Inspection Report (under section 35 of the Banking Regulation Act, 1949) it appears that the name of any political party including B.S.P. and its leader has not been referred therein, in the complaint dated 30.6.2012 filed by the Reserve Bank of India also the name of any political party specially B.S.P. has not been referred, even no allegation has been made in this regard. The perusal of the news item in question shows that it has been published in the main headline "B.S.P. Netas used Bank to launder cash" whereas it is not based on the record of the complaint dated 30.6.2012 filed by the Reserved Bank of India. It also appears that the R.B.I's Inspection Report as a whole has not been published but some averments made therein with regard to respondent no. 2 Sri Satish Chandra Mishra, Sri Akhilesh Das Gupta and his wife have been isolated and published. It also appears that imputation of box attached to the news item in question showing photograph of a bundle of currency notes as well as the sentence - 'The case was taken up by other investigating agencies after intelligence Bureau, which ran its own checks, altered the finance ministry to a suspected money laundering racket running into thousand of crores and the sentence the case was taken up by other investigating agencies after intelligence Bureau, which ran its own checks, altered the finance ministry to a suspected money laundering racket running into thousand of crores.' is also not a part of Judicial record of complaint filed by the Reserve Bank of India. It is neither figuring in the complaint dated 30.6.2012 nor in the Inspection Report of R.B.I., it appears to be a own creation of applicant no. 3. The manner in which the news item in question has been published against respondent no. 2 and others by giving heading that 'BSP netas used bank to launder cash' even after taking response from respondent no. 2 and R.B.I. by applicant no. 3, it may not be presumed that it was not published deliberately, intentionally, knowingly and malafidely to defame the complainant by camouflaging the news and picturing as if the complainant-respondent no. 2 had involved in money laundering through bank cash. The news item is not totally based on the record of court proceedings, therefore, the benefit of the fourth exception of section 499 I.P.C. may not be extended to the applicants. The order dated 5.4.2013 passed by the learned Chief Judicial Magistrate, Lucknow is well reasoned order it has been passed after perusing the record and following the procedure prescribed by law. The learned Chief Judicial Magistrate has recorded the finding that a prima facie offence punishable under sections 500,501 I.P.C. is made out, which is based on the record, it does not require any interference by this court. The learned Chief Judicial Magistrate, Lucknow has not committed any error in taking cognizance and summoning the applicants vide order dated 5.4.2013. The revisional court i.e. learned Additional Sessions Judge, court no. 3 Lucknow has dismissed the criminal revision no. 182 of 2013 filed by the applicant on 17.9.2013, which is a well reasoned and speaking order, it is not suffering from any illegality or irregularity. It also does not require any interference by this court. The complaint dated 25.2.2013 filed by the complainant-respondent no. 2, does not appear to be a complete abuse of the process of the court and law, the same may not be quashed, therefore, the prayer for setting aside the order dated 5.4.2013 passed by the leaned Chief Judicial Magistrate, Lucknow in complaint case no. 2062 of 2013 now pending in the court of learned Judicial Magistrate IInd Lucknow, the order dated 17.9.2013 passed by the learned Additional Sessions Judge, Court No. 3 Lucknow in criminal revision no. 182 of 2013 and to quash the complaint dated 25.2.2013 filed by respondent no. 2, is refused. The interim order dated 25.10.2013 is hereby vacated.
Accordingly this application is dismissed.
Dated 30.1.2015 NA/SU Hon'ble Ravindra Singh,J.
The application is dismissed.
For order see my order of date passed on the separate sheet.
Dated : 30.1.2015 NA/Su