Bangalore District Court
Inspector Of Police vs Shyamraj Singh on 22 October, 2018
IN THE COURT OF THE XLVI ADDITIONAL CITY CIVIL
AND SESSIONS JUDGE AND SPECIAL JUDGE FOR
CBI CASES (CCH-47) AT BENGALURU
Dated this the 31st day of May, 2018.
PRESENT:
S.H.PUSHPANJALI DEVI, B.A. LL.B.,
XLVI Additional City Civil and Sessions Judge
and Special Judge for C.B.I. Cases,
Bengaluru.
CRIMINAL REVISION PETITION No.12/2017
REVISION State represented by
PETITIONER: Inspector of Police,
Central Bureau of
Investigation,
Economic Offences Wing,
Chennai.
(By Special Public Prosecutor)
-VERSUS-
RESPONDENTS : 1 Shyamraj Singh,
S/o.Late Balaji Singh,
Aged 38 years,
r/o.Balaji Sadan,
No.8, Basaveshwara
Badvane,
Hospet,
Bellary.
(By Sri Hashmath Pasha,
Advocate)
2 Asghar Khan,
S/o.Akthan Khan,
2 Crl.R.P.No.12/2017
R/o. 3/224, Khan Building,
Vijayanagar College Road,
Hospet,
Bellary District.
(By Sri Murthy Dayanand Naik,
Advocate.)
:ORDER:
This Criminal Revision Petition is filed by the petitioner/CBI, Economic Offences Wing, Chennai, against the order dated 18.4.2016 passed by the XVII Addl. Chief Metropolitan Magistrate, Bengaluru in C.C.No.6430/2015 discharged the respondents/accused Nos.1 and 2 for the offences punishable under Sections 120B, 379 and 411 of Indian Penal Code.
2. The parties are hereby referred in their original ranking before the Trial Court.
3. The brief facts of the grounds of revision stated by the petitioner/CBI are that, a preliminary enquiry in respect of 32.27 lakh Tons of iron ore exported for the period from 1.1.2009 to 31.5.2010 from Belekeri port, has 3 Crl.R.P.No.12/2017 been conducted by CBI as per the direction passed by Hon'ble Supreme Court of India in Writ Petition (C) 562/2009 dated 7.9.2012. The Hon'ble Supreme Court of India considered Interlocutory Application No.189 filed in the said petition and permitted CBI to file Criminal cases against exporters who have been appeared before the preliminary enquiry and who had exported the iron ore more than 50,000 Metric Tons, without valid permits. Therefore, FIR has been registered in No.26/E/2013 on 30.10.2013 by CBI/EOW/Chennai against M/s.HLL Life Care Limited, Regional Marketing Office, Bengaluru and M.Ayyappan, Managing Director, Directors of said Company, Public Servants of Department of Mines and Geology and Forest Department of the Government of Karnataka and other unknown persons for the offence punishable under Sections 120-B read with 420, 379, 411, 427 and 447 Indian Penal Code, Section 21 read with 4(1) 4(1)(A) and 23 of Mines and Minerals (Development and Regulation) Act, 1957, Section 24 of Karnataka Forest Act, 1963 and Section 13(2) read with 13(1) (d) of Prevention of Corruption Act, 1988. 4 Crl.R.P.No.12/2017
4. The brief facts narrated in the FIR that M/s.HLL Life Care Limited conspired with M.Ayyappan and others in connection with obtaining of iron ore by stealing the natural resource by way of excavation without valid authority from 1.1.2009 to 31.5.2010, by way of trespassing the forest area/Government land. They had illegally exported iron ore and received the stolen iron ore belongs to Government of Karnataka, in total 1,06,739 Metric Tons and illegally exported the same through Belekeri Port, without payment of the Royalty and Forest Department Tax, which has been resulted in wrongful loss to the Government of Karnataka and wrongful gain to themselves. The FIR was pending before XLVI Addl. City Civil and Sessions Judge and Special Judge for CBI cases, Bengaluru City was transferred to the XVII Addl.Chief Metropolitan Magistrate Court, as no evidence made out against public servant. Subsequently, charge sheet has been filed against respondents Shyamaraj Singh and Asghar Khan on 26.2.2015 alleged that wrongful loss caused to the extent of Rs.96,11,799/- against 48,471 5 Crl.R.P.No.12/2017 Metric Tons to the Government of Karnataka and wrongful gain to themselves. After filing charge sheet, XVII ACMM, took cognizance of the offence and registered case in C.C. No.6430/2015 for the offences punishable under Sections 120-B read with 379 and 411 of Indian Penal Code.
5. Further, during the pendency of the case, the accused Nos.1 and 2 have filed application under Section 239 of Cr.P.C. for discharge, which was objected by prosecution. The Trial Court, after hearing both the sides had come to conclusion that no materials to frame charge against accused Nos.1 and 2, allowed the applications filed by them and discharged both the accused on 18.4.2016. The trail court formed opinion that to prove their dishonest intention prosecution has not produced any materials and no ingredients of Section 120-A, 379 and 411 of Indian Penal Code. The Trial Court also opined that accused No.1 being Managing Partner of M/s.SVK Minerals and accused No.2 being Managing Partner of M/s.Bharat Ore and Minerals 6 Crl.R.P.No.12/2017 (BOM) cannot be held responsible as the firms are not made as accused in the case.
6. Aggrieved by the order of discharge of accused Nos.1 and 2, the prosecution has preferred this revision petition and made out the grounds that accused No.1 Shyamraj Singh, Partner of M/s.SVK Minerals, Vyasanakere, Hospet, have the control of said company sold 48,471 Metric Tons of iron ore to accused No.2 Asghar Khan, without any valid permit. The documents produced by prosecution establish that no valid permit obtained by them. The Trial Court has wrongly held accused Nos.1 and 2 are being Proprietors purchased iron ore materials and transported the same to Belekeri Port, later on to M/s.HLL Life Care Ltd. The Trial Court not taken into consideration materials produced by prosecution to establish that iron ore was excavated without the permission of the Government, paying Royalty, without any valid permit sold by the accused Nos1 and 2. It has come to wrong conclusion that the ingredients of Section 378 of Indian Penal Code are not 7 Crl.R.P.No.12/2017 made out by the Trial Court. Further failed to take note that accused No.1 was having control over SVK Plot, Vyasankere, Hospet, had supplied 48,471 Metric Tons of iron ore to accused No.2 at the site of Adani Plot at Belekeri Port. The consignment/delivery notes produced by the prosecution establish that iron ore was loaded at the instance of accused No.1 at SVK Plot and delivered at Adani Plot of Belekeri Port.
7. Further stated that the prosecution has placed materials to establish that accused Nos.1 and 2 had knowledge that the iron ore was stolen property, sold without any valid permit. They have not obtained bulk permits from the Mines and Geology Department at the time of lease of mine. Without bulk permit and corresponding trip sheet, they excavated the quantity of iron ore which cannot be transported to any other place. Non-production of bulk permits or trip sheet inferred the quantity of iron ore was illegally transported and it would amount to transportation of stolen property. The Trial Court 8 Crl.R.P.No.12/2017 at the stage of framing charge ought not to have conducted preliminary enquiry, as the materials produced by the prosecution establish the transportation of iron ore by accused without bulk permit or trip sheet, which was within their knowledge, as to when the property was stolen and purchased by accused No.2.
8. Further stated that the prosecution to establish Criminal Conspiracy has to prove the agreements between two or more persons to do or cause to be done some illegal act or some act, which is not legal by illegal means. The conspiracy to commit offence itself is an offence and a person can be separately charged with respect to such conspiracy. The Trial Court has wrongly discussed that ingredients of Section 378 of Indian Penal Code not been established against accused Nos.1 and 2, on the said ground discharged the accused, which is against law. The criminal liability of accused Nos.1 and 2 under Section 120- B Indian Penal Code is substantive offence. The accused Nos.1 and 2 knowing fully well that the iron ore received by 9 Crl.R.P.No.12/2017 them is a stolen property have illegally transported the iron ore without bulk permit and violated the provisions of MMDR Act.
9. Further stated that illegal agreement can be inferred from the available material produced by the prosecution. The supply of 48,471 Metric Tons iron ore from M/s.SVK Minerals to M/s.Bharat Ores and Minerals it had supplied to M/s.HLL Life Care Limited. The Trial Court has erred that partnership firms were not arrayed as an accused, whereas, the partnership firm has no separate legal entity and there is corporate criminal liability and Company can be prosecuted for criminal offences. Company being body corporate is a person in the eye of law and its Directors and Managers, who represent the Company have control the company, are liable. Further partnership firm is not a separate legal entity in the eye of law and excluded under Sections 305 and 63 of Cr.P.C. The accused No.2 is one of the partner of M/s.Bharat Ores and Minerals along with another mainly Akthar Khan, who is not 10 Crl.R.P.No.12/2017 involved in any of the transactions relating to the present case. Therefore, he cannot be prosecuted as he was innocent person, and not liable for criminal offence committed by another partner. The accused No.2 Asghar Khan had entered into an agreement with M/s.HLL Life Care Limited for supplying the iron ore and supplied the same without valid permits. Therefore, CBI alleged accused Nos.1 and 2 have committed the offence in their individual capacity. The Trial Court has powers to take cognizance of offence against other persons who found to be involved in the offence under Section 319 Cr.P.C. The Trial Court cannot extend benefit of doubt in favour of accused persons at the time of framing of charges.
10. Prosecution further stated about the observation made by the Hon'ble Supreme Court of India in 2001 (6) SCC 670. The accused No.1 himself was having control over a mine has transported iron ore without valid permit by entering into Criminal Conspiracy with accused No.2 and both of them have committed the offence alleged in the 11 Crl.R.P.No.12/2017 charge sheet. Hence, for all the above mentioned grounds prayed to set aside the order of discharge of respondents dated 18.4.2016 passed by the Trial Court and allow the revision petition in the interest of justice.
11. The petitioner/CBI has filed I.A.No.1 under Section 389 Cr.P.C. along with main petition to condone the delay of 234 days in filing the Revision Petition, resisted by accused Nos.1 and 2 by way of filing objection. After hearing both the sides, my learned predecessor has allowed the said application on cost of Rs.1,000/- and condoned the said delay.
12. This Court has secured the Lower Court Records for reference.
13. Heard arguments of learned Special Public Prosecutor for Revision Petitioner and learned Counsel for respondent Nos.1 and 2 on merits.
12 Crl.R.P.No.12/2017
14. The points that would arise for my consideration is:-
1) Whether the order passed by the XVII ACMM, Bengaluru dated 18.4.2016 in C.C.No.6430/2015 ordered for discharge of accused Nos.1 and 2 for the offences punishable under Sections 120B, 378 and 411 of Indian Penal Code is illegal and is to be set aside?
2) What Order?
15. My findings on the above points are as follows:-
Point No.1: In the Affirmative Point No.2: As per final order for the following:-
REASONS
16. Point No.1 :- The prosecution has stated that the Hon'ble Supreme Court of India on 16.9.2013 while disposing an Interlocutory Application (IA) No.189, in WP(C) No.562/2009 permitted CBI to register Criminal Cases 13 Crl.R.P.No.12/2017 against the exporters who were enquired in the Preliminary Enquiry and who had exported iron ore more than 50,000 Metric Tons, without valid permits. Accordingly, an FIR in case No.RC 26/E/2013 was registered on 30.10.2013 by CBI/EOW/Chennai under Sections 120-B r/w. 420, 379, 411, 427, 447 Indian Penal Code, Section 21 r/w. 4(1), 4(1)(A) and 23 of Mines and Minerals (Development and Regulation) Act, 1957, Section 24 of Karnataka Forest Act, 1963 and Section 13(2) r/w.13(1)(d) of Prevention of Corruption Act, 1988, against M/s.HLL Life Care Limited (A-1 in FIR), Regional Marketing Office, Bengaluru and M/s.M.Ayyappan (A-2 in FIR), Managing Director of M/s.HLL Life Care Ltd., Bengaluru, other directors, public servants of Department of Mines and Geology and Forest Department of the Government of Karnataka and other unknown persons.
17. After investigation the CBI has filed Police Report under Section 173 Criminal Procedure Code before XVII Additional Chief Metropolitan Magistrate, Bengaluru (herein referred as XVII ACMM) against 14 Crl.R.P.No.12/2017 respondents/accused Nos.1 and 2 for the offence punishable under Sections 120-B read with 379 and 411 Indian Penal Code.
18. It is important to point out the allegation made by CBI against accused Nos.1 and 2 that they entered into Criminal Conspiracy and illegally excavated iron ore of 48,471 Metric Tons and supplied it to M/s.HLL Life Care Ltd., caused loss of Royalty of Rs.96,11,799/- to the Government of Karnataka. In the FIR the details of accused No.1 M/s.HLL Life Care Ltd., represented by Managing Director - M.Ayyappan made as accused No.2. In the charge sheet shown as accused Nos.1 and 2 mentioned in FIR along with other accused Nos.3 to 6 are not arrested. However, the charge sheet is filed only against accused Nos.1 and 2, the present respondents.
19. It is further made out from the case of prosecution that the second respondent Asghar Khan/accused No.2 was not arrested as on the date of filing the police report by the Investigating Officer. The 15 Crl.R.P.No.12/2017 allegations made in the charge sheet that after registering the case in compliance of above direction given by the Hon'ble Supreme Court of India, CBI has proceeded with the investigation. It is alleged that M/s.HLL Life Care Ltd., conspired with M.Ayyappan, during the period from 1.1.2009 to 31.5.2010 they along with others have obtained iron ore by stealing the natural resources without valid permit by trespassing into the various area of Government land to the tune of 1,06,739 Metric Tons and illegally exported through Belekeri Port and required royalty not paid which caused wrongful loss to the Government of Karnataka and wrongful gain for themselves.
20. Further the allegation made against M/s.HLL Life Care Ltd., is a public sector enterprises of Government of India under Ministry of Health and Family Welfare, manufacturing of health products like contraceptives, sutures, blood bags and pharma products. It entered into a Memorandum of Understanding for setting export target every year and during 2004 to 2006, had shortage of its 16 Crl.R.P.No.12/2017 export turnover. During February-2006, M/s.HLL Life Care Ltd., advertised in leading newspapers for purchase of export turnover. Thereafter, company decided to enter into iron ore export business to meet the export target. The memorandum of understanding singed with M/s.Goa Mining Industries (GMI) for supply of iron ore. Further, during the investigation it has been revealed that M/s.HLL Life Care Ltd. purchased 11,402 Metric Tons of iron ore from M/s.A.R.Logistics (M/s.ARL) and 95,337 Metric Tons of iron ore from M/s.Bharat Ores and Minerals (M/s.BOM) on Free on Board (FOB) basis, respectively. During investigation it is made out that M/s.HLL Life Care Ltd. purchased remaining 95,337 Metric Tons of iron ore from BOM after purchasing 94,742 Metric Tons of iron ore from various mine owners with DMG permits during the relevant period. The important aspect said to be revealed during the investigation that accused No.2 Asghar Khan being a trader had purchased iron ore from the plots of M/s.SVK Minerals belonging to accused No.1 Shyamraj Singh and Vyshnavi Minerals belonging to B.P.Anand Kumar @ Anand Singh to 17 Crl.R.P.No.12/2017 fulfill its supply to M/s.HLL Life Care Ltd. It has been clearly mentioned in the charge sheet that the accused Nos.2 to 7 were removed iron ore on Free on Board (FOB) basis and no role of them in the transaction, therefore, they are not charge-sheeted.
21. The specific allegation made against accused No.1 - Shyamraj Singh that he being Managing Partner of M/s.S.V.K.Minerals and accused No.2 - Azghar Khan being Managing Partner of M/s.BOM, criminally conspired and after illegal excavation of iron ore of 95,337 Metric Tons from Belekeri Port sold it to M/s.HLL Life Care Ltd. Therefore, the CBI alleged that accused Nos.1 and 2 criminally conspired and illegally excavated iron ore to the tune of 48,471 Metric Tons for supply it to M/s.HLL Life Care Ltd. It is seen from the charge sheet that the respondent Nos.1 and 2/accused Nos.1 and 2 in their individual capacity held liable for the alleged supply of iron ore from Belekeri Port. However, after filing the charge sheet the respondents appeared before the Trial Court and enlarged 18 Crl.R.P.No.12/2017 on bail. Thereafter, filed the applications for discharge which were came to be allowed and both of them ordered to be discharged for the offence punishable under Section 120B read with 379, and 411 Indian Penal Code.
22. The learned Special Public Prosecutor has submitted about the allegation made against respondent Nos.1 and 2/accused Nos.1 and 2 regarding illegal transportation of 1,06,739 Metric Tons of iron ore for the period from 1.1.2009 to 31.5.2010 without valid permits from Belekeri Port. Since the involvement of accused Nos.1 and 2 as public servants not proved during the investigation, the offence under Section 13(2) of Prevention of Corruption Act and MMDR Act not alleged by CBI. It is further pointed out that Government will issue permit mentioning quantity, and the place from where to where it should be supplied.
23. The learned Special Public Prosecutor has relied on the following Rulings:
19 Crl.R.P.No.12/2017
1) (2014) 9 Supreme Court Cases 772 in the case of STATE (NCT OF DELHI) VS. SANJAY The observation made under Head Note B with respect to "mining of sand from riverbed without licence/permit - held is an offence under Section.378 IPC r/w Section 379 IPC. The ingredients of said offence are distinct and different from the offence under Section 4 (1-A), MMDR Act -
Mines and Minerals (Development and Regulation) Act, 1957, Section 4(1-A). The observation made by the Supreme Court in relevant paras as Natural resources are public property and national assets. The doctrine of public trust extends to natural resources. There should be a balance between the conservation of natural resources and urban development. There cannot be any two opinions that natural resources are the assets of the nation and its citizens. It is the obligation of all concerned, including the Central and the State Governments, to observe and not waste such valuable resources. In view of Articles 48-A and 51- A of the Constitution, the doctrine of public trust has become the law of the land. The said doctrine rests on the principle that certain resources like air, sea, water and forests are of such great importance to the people Sanction Advise a whole that it would be highly unjustifiable to make them a subject of private ownership."
20 Crl.R.P.No.12/2017
Further observed that "there cannot be any two opinions that natural resources are the assets of the nation and its citizens. It is the obligation of all concerned, including the Central and the State Governments, to conserve and not waste such valuable resources. Article 48-A of the Constitution requires that the State shall endevour to protect and improve the environment and safeguard the forests and wildlife of the country. Similarly, Article 51-A enjoins a duty upon every citizen to protect and improve the natural environment including forest, lakes, rivers and wildlife, and to have compassion for all the living creatures. In view of the constitutional provisions, the doctrine of public trust has become the law of the land. The said doctrine rests on the principle that certain resources like air, sea, water and forests are of such great importance to the people as a hole that it would be highly unjustifiable to make them a subject of private ownership."
The Hon'ble Supreme Court of India form definite opinion that "the ingredients constituting the offence under the MMDR Act and the ingredients of dishonestly removing sand and gravel from the riverbeds without consent, which is the property of the State, is a distinct offence under IPC. Hence, for the commission of offence under Section 378 IPC, on receipt of the police report, the 21 Crl.R.P.No.12/2017 Magistrate having jurisdiction can take cognizance of the said offence without awaiting the receipt of complaint that may be filed by the authorised officer for taking cognizance in respect of violation of various provisions of the MMDR Act."
2) 1999 SCC (Crl) 373 in the case of State Anti- Corruption Bureau, Hyderabad Vs. P.Suryaprakasam.
The observation made by Hon'ble Supreme Court of India that "at the time of framing of charge, the Trial Court is required to, and can consider only the police report referred to under Section 173 Cr.P.C. and the documents sent with it."
3) 1991 Crl.L.J. 141 (Delhi HC) in the case of Narinder Pal Sood and another Vs. State (Delhi Admn.) and another.
The observation made regarding "powers of Court in revision filed against discharge of accused. It could not be urged that the Sessions Court had no power to reverse the finding of the Magistrate by which he held that no offence prima facie appears to have been made out against the accused and to give its own finding that prima facie such an offence stood committed."
22 Crl.R.P.No.12/2017
4) 2001(6) SCC 670 in the case of M/s.Swil Ltd., Vs. State of Delhi and another.
The Hon'ble Supreme Court of India has referred Sections 173(2) and 191(b) Cr.P.C. relates to taking cognizance of the offence by the Magistrate after receipt of police report. The observation made as "even if the police report is to the effect no case is made out against accused by ignoring conclusion arrived at by Investigating Officer and independently applying his mind to the fact emerging from the investigation by taking into the statements of witnesses examined by the police."
Further discussed that at the stage of taking cognizance, no question of application of Section 319 Cr.P.C. The similar contention was negatived in the case of Raghubans Dubey Vs. State of Bihar by holding that-----"once cognizance has been taken by the Magistrate, he take cognizance of an offence and not the offenders; once he takes cognizance of an offence it is his duty to find out who the offenders really are and once he comes to the conclusion that apart from the persons sent up by the police some other persons are involved, it is his duty to proceed against those persons. The summoning of additional accused is part of the proceeding initiated by his taking cognizance of an offence."
23 Crl.R.P.No.12/2017
The Hon'ble Supreme Court of India has disposed the petition accordingly and the Trial Court was directed to proceed with the matter in accordance with law.
24. The learned Counsel for accused No.1 has argued the grounds for discharge made out before Trial Court that the sale for M/s.SVK Minerals was based on legal permit and iron ore materials excavated and they are legal materials stored and later sold under invoice and permit, therefore, transaction was legal. Further, since the firm M/s.SVK Minerals not made as accused, no vicarious liability of partner. Companies liability cannot be fastened on the partner without making them as accused. Further submitted that the investigation does not say about from where 48,471 Metric Tons excavated and supplied. No illegality as iron ore not excavated from forest area or Government Land. There is no proof of place of export from which place to where and who has conspired to remove the iron ore. Therefore, argued no offence committed by accused No.1 as no theft of iron ore as alleged by the CBI. 24 Crl.R.P.No.12/2017 The scope of Section 227 and 239 of Cr.P.C. also brought to the notice of the Court.
25. The learned Counsel in support of the arguments relied on the following:
1) Unreported decision in Crl.Petn No.818/2017 -
Ajay Kharbanda Vs. Central Bureau of Investigation.
The Hon'ble High Court of Karnataka held that "without making the Company as an accused, the Managing Director individually cannot be prosecuted in view of circumstances discussed on the basis of ruling reported in (2015) 12 Supreme Court Cases 781, when the allegation made against the Company which has not been made as party."
The Hon'ble High Court of Karnataka has allowed the Criminal Revision Petition and discharged accused No.16 on the ground Company not made as accused, but the respondent CBI given opportunity to take appropriate action against Company and Managing Director at the relevant point of time, if law provides.
2) (2015) 12 Supreme Court Cases 781 in the case of Sharad Kumar Sanghi Vs. Sangita Rane. 25 Crl.R.P.No.12/2017
The Hon'ble Supreme Court of India held that the allegations made against the company and the company has not been made a party, therefore the allegations are restricted to the Managing Director. The allegations are vague and in fact, the same are principally leveled against the Company. There is no specific allegation against the Managing Director. When a company has not been arrayed as a party, no proceeding can be initiated against it even where vicarious liability is fastened under certain statutes. When a complainant intends to rope in a Managing Director or any officer of a company, it is essential to make requisite allegation to constitute the vicarious liability.
3) (2012) 5 Supreme Court Cases 661 in the case of Aneeta Hada Vs. Godfather Travels and Tours Private Limited.
The Hon'ble Supreme Court of India held that the Company is a juristic person. The concept of corporate liability is attracted to a corporation and company and it is so luminescent from the language employed under Section 141 of the Negotiable Instruments Act. -----
Further observed that the company can have criminal liability fastened on it, and if a group of persons that guide the business of the companies 26 Crl.R.P.No.12/2017 have the criminal intent, that would be imputed to the body corporate.
Further Section 141 of the NI Act is concerned with the offences by the company and it makes the other persons vicariously liable for commission of an offence on the part of the company.
4) 2005 Supreme Court Cases (Cri) 961 in the case of Standard Chartered Bank and others Vs. Directorate of Enforcement and others.
The observation made by Hon'ble Supreme Court of India that "all criminal and quasi-criminal offences are creatures of statute, the amenability of the corporation to prosecution necessarily depends upon the terminology employed in the statute. In the case of absolute liability where the legislature by the clearest intendment establishes an offence where liability arises instantly upon the breach of the statutory prohibition, no particular state of mind is a prerequisite to guilt. Corporations and individual persons stand on the same footing in the face of such a statutory offence."
The reference of case of - State of Rajasthan Vs. Shamsher Singh is relied on in which it is observed as "there is no blanket immunity for any company from any prosecution 27 Crl.R.P.No.12/2017 for serious offences merely because the prosecution would ultimately entail a sentence of mandatory imprisonment. The corporate bodies, such as a firm or company undertake a series of activities that affect the life, liberty and property of the citizens. There is no immunity to the company from prosecution merely because the prosecution in respect of the offences for which the punishment prescribed is a mandatory imprisonment and fine."
5) 2014 Crl.L.J. 4854 (Supreme Court) in the case of State of NCT of Delhi Vs.Sanjay with Jayasukh Bhavanji Shinghalia Vs. State of Gujarat and another.
The gist of this ruling is "the ingredients constituting the offences under MMDR Act and ingredients of removing sand and gravel from the riverbeds without consent, which is the property of the State which is a distinct offence under the Indian Penal Code. Therefore, on receipt of the police report, the Magistrate having jurisdiction can take cognizance of the offence u/S.378 Cr.P.C. without awaiting the receipt of compliant that may be filed by the authorised officer for taking cognizance in respect of violation of various provision of MMDR Act."
6) AIR 2015 Supreme Court 923 in the case of Sunil Bharti Mittal Vs. Central Bureau of Investigation.
28 Crl.R.P.No.12/2017
The observation made by Hon'ble Supreme Court of India that "there is no concept of vicarious liability unless the statute covers the same within its ambit.----The Managing Director or the Directors of the Company, thus, cannot be said to have committed an offence only because they are holders of offices and they cannot be summoned because of some allegations were made against the Company."
26. The learned Counsel for accused No.2 has submitted that there is no background to file charge sheet accused No.2 in his individual capacity as FIR registered by the CBI on the basis of direction given by the Hon'ble Supreme Court of India. The alleged transaction of iron ore is less than 50,000 Metric Tons. No allegation made against him while registering the case, after investigation his name shown in the charge sheet and made as accused No.2 who was not arrested by CBI.
27. In support of the submission the learned Counsel has relied on the following Rulings:
29 Crl.R.P.No.12/2017
1) (2008) 2 Supreme Court Cases 561 in the case of Onkarnath Mishra and others Vs. State (NCT of Delhi) and another.
The Hon'ble Supreme Court of India discussed the ingredients and prerequisites for presumption of offence u/S.498-A of Indian Penal Code and quashed the charges against accused Nos.1 and 2 on the ground the charge under the said section is not brought in the complaint/FIR and charge sheet against them and directed the Trial Court to continue against accused No.3 for the said offence.
2) (2014) 14 Supreme Court Cases 401 in the case of L.Krishna Reddy Vs. State by Station House Officer and others.
The Hon'ble Supreme Court of India discussed that "once the case is presented to the Court by the prosecution, its bounden duty is to sift through the material to ascertain whether a prima facie case has been established which would justify and merit prosecution of a person."
3) (2013) 8 Supreme Court Cases 154 in the case of Samaj Parivartana Samudaya and others. Vs. State of Karnataka and others.
30 Crl.R.P.No.12/2017
The Hon'ble Supreme Court of India in the relevant para has discussed the constitution of offence under MMDR Act that "dumping of mining waste (overburden dumps) do not constitute operations under Section 3(d) of the MMDR Act is too naive for acceptance. The wide terms of the definition contained in Section 3(d) of MMDR Act encompasses all such activity within the meaning of expression 'Mining Operations'. The use of the forest land for such activity would require clearance under the FC Act. In case the land used for such purpose is not forest land the mining lease must cover the land used for any such activity." The learned Counsel also relied on the unreported Ruling decided by Hon'ble High Court of Karnataka in Criminal Petition No.818/2017 dtd.9.2.2018 and (2015) 12 SCC 781 cited for respondent No.1.
28. I have perused the statements of witnesses in detail with documents produced before the Court. It is made out that the alleged excavation of iron ore by respondent Nos.1 and 2 who were entered into Criminal Conspiracy and supplied iron ore fines of 48,471 Metric Tons to M/s.HLL Life Care Ltd. without valid permit which 31 Crl.R.P.No.12/2017 resulted in loss of royalty to the Government of Karnataka. The CBI alleged that illegal transportation of iron ore without proper permit would amount theft of natural resource and in person receipts with iron ore amounts to receipt of stolen property. Therefore, the offences alleged against them punishable under Section 120B read with 379 and 411 Indian Penal Code.
29. Further the learned Counsel for accused No.1 in proof of valid transaction said to be entered by him has produced the documents before Trial Court along with application filed under Section 239 of Cr.P.C. are as follows:
1) Tax invoice dated 30.4.2009 for delivery of 30,940 Metric Tons of iron ore fines to Bharath Ore and Minerals.
2) Permits issued by Dy.Director of Mines and Minerals Department in favour of M/s.SVK Minerals dated 17.12.2007, 13.2.2008 and 9.6.2008.
3) Tax invoice dated 31.3.2009 quantity 17,531 Metric Tons for sale of iron ore fines delivered to Bharath Ore and Minerals.
4) Permit dated 18.8.2008 issued by Dy.Director of Mines and Minerals Department in favour of M/s.SVK Minerals.
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5) True copies of details of sale of iron ore and Bank details of Bharath Ore and Minerals.
6) True copy of Ledger Account Extract of M/s.SVK Minerals and Bharath Ore and Minerals, Hospet from 1.4.2008 to 31.3.2009.
7) True copy of Ledger Extract of M/s.SVK Minerals and Bharath Ore and Minerals, Hospet from 1.4.2009 to 31.3.2010.
8) Statement of account of M/s.SVK Minerals for the period 1.4.2009 to 31.3.2010.
30. The above documents produced by accused No.1 however, will not disclose the valid transportation of iron ore under the permit issued by the concerned department for the period of alleged illegal transportation of iron ore mentioned in the charge sheet. Because there is difference in the dates of permits issued in favour of M/s.SVK Minerals for transportation of iron ore fines. Therefore, those documents however, will not establish the legal transaction done by accused No.1 as alleged.
31. Further, I have perused the list of documents in total number 138 and 23 statement of witnesses recorded by Investigating Officer produced by CBI. The statements 33 Crl.R.P.No.12/2017 particularly of official witnesses, prima facie supports the documents relied on by the prosecution in proof of the alleged illegal transportation of iron ore fines by accused Nos.1 and 2. Because the documents relied by the accused No.1 discloses sale of iron ore fines of different quantities delivered to Bharath Ore and Minerals from M/s.SVK Minerals under the permits issued by Mines and Geology Department for the period from 17.12.2007 till 18.8.2008. But the alleged transaction of illegal transportation of iron ore fines by accused Nos.1 and 2 for the period from 1.1.2009 to 31.5.2010, for which no valid permits obtained either by accused No.2 to purchase the iron ore or by the accused No.1 for sale of said material. Therefore, the documents produced by the prosecution prima facie proves the case made out against accused Nos.1 and 2 in their individual capacity and not as Managing Partners of M/s.SVK Minerals and M/s.Bharat Ores and Minerals.
32. I have gone through the reasons given by the Trial Court while discharging the accused Nos.1 and 2 34 Crl.R.P.No.12/2017 allowing applications filed under Section 239 Cr.P.C. No doubt, the Trial Court has elaborately discussed ingredients of Section 120A and 378 of Indian Penal Code to constitute Criminal Conspiracy under Section 120-B and theft under Section 379 Indian Penal Code. It has stated as prosecution has not produced any material to show that accused persons without consent of the Government excavated iron ore and transported the same with dishonest intention and also without payment of Royalty to the Government. It has also discussed about Companies of respondent Nos.1 and 2 not made as accused, therefore no criminal liability on their part. Further, stated that accused No.2 being Trader, purchased the iron ore materials in the name of Bharat Ores and Minerals and exported the same to the foreign country. He had also purchased materials from accused No.1 and M/s.Vaisnavi Minerals as well as from other Companies. The Trial Court opined that iron ore materials exported by accused No.2 by paying Cess, Port Customs Duty, without going through the documents produced by CBI in detail. Therefore, the Trial 35 Crl.R.P.No.12/2017 Court has opined that no grounds to frame charge against them for the offence punishable under Sections 120B, 379 and 411 Indian Penal Code.
33. I do accept that the argument canvassed by the learned Counsel for respondent Nos.1 and 2 relates to the Company has not made as accused though the entire transaction said to be made by accused Nos.1 and 2 through M/s.SVK Minerals and M/s.BOM Company as discussed in the above-mentioned Rulings. But the CBI alleged that the accused Nos.1 and 2 in their individual capacity entered into Criminal Conspiracy, committed theft of iron ore from Government Land, thereafter sold it to foreign countries. Therefore, for their individual acts, other Partners cannot be penalized.
34. However, the important aspect is to be noted that the observation made by the Hon'ble High Court of Karnataka in Crl.Petn. No.818/2017 dated 9.2.2018 that though the accused No.16 of the said case, being the 36 Crl.R.P.No.12/2017 Managing Director, was discharged on the ground that individually he cannot be prosecuted in view of circumstances of the case in Spl.C.C.No.6/14 and the observation made reads as "Order of discharge does not debar the respondent to take appropriate action at the right point of time against the Company as well as Managing Director, if law provides."
35. The prosecution has relied on the documents, statements of witnesses produced along with charge sheet, which prima facie proves the sale of 48,471 Metric Tons of iron ore fines by accused No.1 to accused No.2 Azghar Khan, without any valid permit amounts to illegal transaction attracts the offence alleged in the charge sheet. Therefore, the documents relied by respondent No.1 referred above though considered, the period alleged to be permitted to transport the iron ore is different from the alleged period of illegal transportation of iron ore by the accused Nos.1 and 2 mentioned in the charge sheet. The Trial Court has committed error and discharged the 37 Crl.R.P.No.12/2017 accused Nos.1 and 2 taking into consideration of documents produced by accused No.1, which will not establish the transportation of iron ore under legal permit. Moreover, no prior bulky sheets also obtained by accused Nos.1 and 2 while transportation of iron ore fines alleged in the charge sheet.
36. After going through the entire records, I am of the opinion that the Trial Court without recording any evidence or trial has come to wrong conclusion that no ingredients of Section 378 Indian Penal Code, hence no offence under Section 379 Indian Penal Code committed by respondents and there was no evidence for the offence under Section 120B read with 411 Indian Penal Code.
37. It is relevant to point out that after receipt of Police Report, the Trial Court has perused all the materials and took cognizance of the offence against the accused Nos.1 and 2. Therefore, it ought to have proceeded further on the basis of statements of prosecution witnesses 38 Crl.R.P.No.12/2017 recorded by Investigating Officer and documents collected by him during the investigation. Because, the court is to evaluate material and documents on record with a view to finding out if the facts emerging there from taken at their face value disclose the existence of all the ingredients constituting the alleged offence as referred in AIR 2001 SC 1375 - Suresh Vs. State of Maharastra. Therefore, the Trial Court ought to have perused all the materials produced by CBI in detail while considering application filed for discharge by the respondents. But the Trial Court has committed error and discharged the accused Nos.1 and 2 without considering all the materials in detail for the above- mentioned offences.
38. After going through the reasons made out by the Trial Court, I do not understand how it has come to conclusion that no material produced by CBI to proceed against the accused Nos.1 and 2 for the offences alleged in the charge sheet. Because, the Trial Court at the initial stage has opined that there was prima facie materials 39 Crl.R.P.No.12/2017 produced by CBI to take cognizance of the offence against the respondents and cognizance has been taken for the offences punishable under Section 120B, 379 and 411 of Indian Penal Code. However, at later stage, while considering the applications filed for discharge, it has wrongly come to conclusion that no ingredients of alleged offences made out by the CBI against the accused persons. It is settled principle of law that the Court after recording evidence, if it find any of the other persons not made as accused, it has power to summon other persons as provided under Section 319 of Cr.P.C. It is true, the CBI at the initial stage while registering FIR made M/s.HLL Life Care Ltd. and others as accused Nos.1 to 7, they were left out in the charge sheet. Afterwards, on the basis of materials collected by the Investigating Officer during investigation, the respondent No.1 made as accused No.1 and respondent No.2 as accused No.2.
39. It is relevant to point out the observation made by the Hon'ble Supreme Court of India with regard to 40 Crl.R.P.No.12/2017 powers of the Court under Section 319 Cr.P.C. in the Ruling reported in (2014) 2 SCR Page 1 in the case of Hardeep Singh Vs. State of Punjab & Ors., as under:
It is the duty of the Court to do justice by punishing the real culprit. Where the investigating agency for any reason does not array one of the real culprits as an accused, the court is not powerless in calling the said accused to face trial. The question remains under what circumstances and at what stage should the court exercise its power as contemplated in Section 319 Cr.P.C.?
Section 319 Cr.P.C. allows the court to proceed against any person who is not an accused in a case before it. Thus, the person against whom summons are issued in exercise of such powers, has to necessarily not be an accused already facing trial. He can either be a person named in Column 2 of the charge sheet filed under Section 173 Cr.P.C. or a person whose name has been disclosed in any material before the court that is to be considered for the purpose of trying the offence, but not investigated. He has to be a person whose complicity may be indicated and connected with the commission of the offence.
The Court is the sole repository of justice and a duty is cast upon it to uphold the rule of law and, therefore, it will be inappropriate to deny the existence of such powers with the courts in our 41 Crl.R.P.No.12/2017 criminal justice system where it is not uncommon that the real accused, at times, get away by manipulating the investigating and/or the prosecuting agency. The desire to avoid trial is so strong that an accused makes efforts at times to get himself absolved even at the stage of investigation or inquiry even though he may be connected with the commission of the offence.
Section 319 Cr.P.C. is an enabling provision empowering the court to take appropriate steps for proceeding against any person not being an accused for also having committed the offence under trial. It is this part which is under reference before this Court and therefore in our opinion, while answering the question referred to herein, we do not find any conflict so as to delve upon the situation that was dealt by this Court in Dharam Pal (CB).
40. The power under Section 319 Cr.P.C. is to be exercised only on evidence recorded in the process of any enquiry or trial to proceed against the person other than the person appearing to be guilty of offence. However, the provision Section 305 Cr.P.C. applies only when Corporation or Registered Society made as an accused. 42 Crl.R.P.No.12/2017
41. After perusal of above mentioned Rulings in detail, I come to conclusion that the Trial Court without considering the entire material in proper manner has come to wrong conclusion that no case is made out by CBI against accused Nos.1 and 2 and discharged them illegally. On the other hand, the Trial Court on the basis of materials produced by CBI ought to have dismissed the applications filed for discharge and framed the charge for the offence punishable under Section 120B, 379 and 411 IPC. After framing the charge against accused Nos.1 and 2, the Managing Partners of M/s.SVK Minerals and M/s.Bharat Ores and Minerals, during the trial, if any evidence produced by prosecution against those Companies, it should have exercised the powers under section 319 Cr.P.C. and summon those Companies to proceed with the trial. Therefore, in my opinion, the order of discharge of accused Nos.1 and 2 passed by the Trial Court is illegal and is to be set aside. Hence, I answer point No.1 in Affirmative. 43 Crl.R.P.No.12/2017
42. Point No.2:- For the above reasons, I proceed to pass the following : ORDER :
The revision petition filed by the
petitioner/CBI, EOW, Chennai, is hereby
allowed.
Consequently, the order of Trial Court dated 18.4.2016 passed on applications filed by the respondents under Section.239 Cr.P.C. and their discharge from the case is hereby set aside.
The matter is remanded to the Trial Court with a direction to frame the charge against the respondents and proceed with the case in accordance with law.
(Dictated to Judgment Writer, transcribed and computerized by him, revised by me and after corrections, pronounced in the open Court on this the 31st day of May, 2018.) (S.H.PUSHPANJALI DEVI) XLVI Additional City Civil and Sessions Judge and Special Judge for CBI Cases, Bengaluru.
Digitally signed by SAKE HARIDAS PUSHPANJALI DEVI
SAKE HARIDAS DN: cn=SAKE HARIDAS
PUSHPANJALI
PUSHPANJALI DEVI,ou=HIGH COURT OF
KARNATAKA,o=GOVERNME
DEVI NT OF
KARNATAKA,st=Karnataka,c
=IN
Date: 2018.06.02 12:50:39 IST