Calcutta High Court (Appellete Side)
P. J. Nayak vs Arihant Kumar Parakh on 12 June, 2013
Author: Toufique Uddin
Bench: Toufique Uddin
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06/12/2013
CRR No. 1369 of 2012
P. J. Nayak
vs.
Arihant Kumar Parakh
Mr. Debasis Roy
... For the petitioner
This is an application under Section 482 of the Code of
Criminal Procedure, 1973 for quashing of proceedings of CR case
No. 384 of 2008 pending before the learned Judicial Magistrate,
1st Class, 2nd Court, Siliguri, Darjeeling under Sections
409/420/467 IPC and all orders passed therein including the
orders dated 16.1.2010, 20.11.2010 and 22.9.2011.
In the background of this revision the fact in a nutshell
is that the petitioner is aged about 64 years. He was the Chief
Executive Officer of Axis Bank Ltd. He retired from his service on
28.4.2008. The petitioner being Chairman cum Managing
Director of the Bank does not interfere with the day to day affairs
of running the branch or granting cards he had no role directly or
indirectly in the alleged activity at all. On 16.6.2008 the
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Opposite Party filed impugned petition of complaint before the
learned Additional Chief Judicial Magistrate, Siliguri, Darjeeling
against the petitioner herein and others and the same was
numbered as CR Case No. 384 of 2008. The allegation was that
in course of banking activities Axis Bank Ltd. sanctioned Channel
financial facility in favour of the Opposite Party firm viz. M/s.
Parakh Service Station vide letter dated 19.1.2007 and issued a
trade acceptance card on the POS terminal provided at Indian Oil
Companies Ltd., Siliguri Depot with a limit of Rs. 50 lacs on
certain terms and conditions. The said bank obtained four pre-
signed blank cheques bearing cheque nos. 401771 to 401774
from the Opposite Party firm as security for the said channel
finance account. Soon after operation of the said account, the
Opposite Party found that the said bank has debited a sum of Rs.
780000/- in the account of Opposite Party firm, on 22.2.2007
against purchase of stocks for Rs. 390000/- from IOL on
20.2.2007. The trade acceptance card issued by the said bank
was used for purchasing the stocks of Rs. 390000/-. However,
the amount as debited by the said bank in its statement of
account was shown as Rs. 780000/- instead of Rs. 390000/-.
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The Opposite Party pointed out the excessive debit entry of Rs.
780000/- with the officials of the said bank as also vide letter
dated 19.3.2007 which was followed by personal visit for holding
discussions with the officials of the said bank. It is alleged that
Uttam Saha (accused No. 3) although sent e-mail to Opposite
Party firm on 25.4.2007, but he without checking its own
accounts, had wrongly stated that the card in question was
swiped for two valid transactions of Rs. 390000/-. The Opposite
Party thereafter vide e-mail dated 29.5.07 requested to look into
the matter and correct the said transaction. As no response was
forthcoming from the said bank, the Opposite Party sent another
letter dated 31.8.2007 to the Senior Vice-President of the said
Bank, Mumbai branch as also the Branch Manager of the said
bank at Siliguri requesting them to resolve the matter of
excessive debit entry. Subsequently, on 5.9.07, said Uttam Saha
informed that the Opposite Party's firm through a e-mail that
there was a discrepancy of Rs. 390000/- but failed to resolve the
said discrepancy that on repeated request made by the Opposite
Party. Thereafter the said bank rectified the said debit entry of
Rs. 780000/- by crediting the excessive amount of Rs. 390000/-
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on 1.10.2007 but again made a wrong entry for a sum of Rs.
378000/-. On 1.10.07 showing the effective date as 7.4.07, the
Opposite Party firm did not purchase the stocks worth Rs.
378000/- from Indian Oil Corporation Ltd. either on 7.4.07 or on
1.10.07. due to debit of Rs. 390000/- on 20.2.07 and Rs.
378000/- on 1.10.07. The aforesaid channel financial account of
the Opposite Party firm was debited by the said bank with a huge
amount besides the amount of interest which the said bank had
changed and debited in the account from the month to month.
Inspite of repeated reminders to rectify the said entry of Rs.
378000/-, the bank had been persisting the Opposite Party firm
for making payment of due amount including the successive
amount of Rs. 378000/-. The bank also wrote letters to Indian
Oil Company Ltd. as a result of which the reputation of the
Opposite Party and his firm had been damaged. It is further
alleged that the said bank also arbitrarily blocked the said Trade
Acceptance Card and stopped the operation of the said account
and demanded a sum of Rs. 1284104/- from the Opposite Party
firm vide e-mail dated 23.4.2008 that in order to maintain the
good gesture with IOL, the Opposite Party arranged to issue the
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post-dated cheques for Rs. 500000/-, Rs. 400000/- and Rs.
384104/- to the said bank towards payment of the said dues and
also requested the said bank to correct the account and refund
the excessive amount at the earliest. The said cheques were
received by the said bank but subsequently the Opposite Party
came to know from the bank statement dated 21.5.2008 that the
accused persons in collusion with other associates have forged
one of the said cheques bearing No. 401771 by inserting a sum of
Rs. 1730000/- and also putting a date of their own choice as
15.5.2008 and presented the said cheque with ICICI Bank Ltd.
Siliguri for encashment. The Opposite Party on 22.6.2008 met
accused No. 2 and requested him to return the aforesaid cheques
and to rectify the bank account by crediting the sum of Rs.
378000/-. However, the accused person refused to return the
said cheques and told the Opposite Party that the same were
lying in the custody of accused No. 1 and the accused person also
asked the Opposite Party to make payment of a further sum of
Rs. 445896/- at the earliest. The Opposite Party was thereafter
served with a notice dated 29.5.2008 issued by the said bank
through its lawyer therein demanding the said sum of Rs.
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445896/-. The Opposite Party thereafter approached the accused
bank for making payment of a sum of Rs. 445896/- on protest
and further requested the said bank to return the pre-signed
cheques as also other signed and unsigned documents but in
vain. The said bank, thereafter, on 14.6.2008, received a sum of
Rs. 430385/- instead of Rs. 445896/- towards outstanding
balance showing in its account though the accused persons
attempted to withdraw a sum of Rs. 1730000/- from the bank
account of the Opposite Party alongwith the said sum of Rs.
445896/-. The accused persons deceived the Opposite Party by
inflating the account with a sum of Rs. 378000/- on 1.10.2007
with dishonest and fraudulent intention.
The learned Additional Chief Judicial Magistrate,
Siliguri, Darjeeling took cognizance of the offences. The Opposite
Party and others were examined under Section 200 of the Code of
Criminal Procedure. Thereafter, the learned JM, 1st Class, 2nd
Court, Siliguri who received the case of transfer, by the impugned
order dated 16.1.2010 mechanically and without any application
of judicial mind issued process under Sections 409/420/467 IPC
against the petitioner. On 20.11.2010 the learned Magistrate
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without recording any reasons issued a non-bailable warrant of
arrest against the petitioner. On 22.9.2011 the learned
Magistrate issued a fresh non-bailable warrant.
Hence the revision.
The learned Counsel for the Petitioner submits that an
offence of cheating within the meaning of Section 420 IPC
necessitates dishonest intention or criminality in the act of the
offender right from the beginning in respect of the transaction
between the accused and the complainant and it must be shown
prima facie that at the very outset the accused had dishonest
intention to cause wrongful gain to the complaint and with that
end in view made representation of facts to the complainant and
thereby induced the complainant to do or to omit to do anything
that the complainant would not have done or omitted to have
done but for the inducement. The allegations made in the
impugned petition of complaint far from showing any such
criminality or in the act of petitioner or dishonest intention of the
petitioner does not show that at the very outset the petitioner
transacted with the Opposite Party by making any false
representation of facts.
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The basic ingredients of criminal breach of trust are a)
entrustment of property by the aggrieved to the accused, b)
subsequent misappropriation of the said property by the accused.
It is apparent that in case of the commission of offence under
Section 420 IPC there must exist false and fraudulent
representation by the accused to the aggrieved prior to delivery of
the valuable property by the aggrieved to the accused and thus
transfer of property in respect of offence under Section 420 IPC is
not voluntary but is a result of such inducement. Moreover, in
case of an offence of criminal breach of trust, the transfer of
valuable property from the possession of aggrieved to the accused
is not due to any result of inducement but is a voluntary act.
In the entire petition of complaint, the Opposite Party
has not stated about any document which can be said to have
been forged in terms of the provisions of Section 463 IPC. Hence,
Section 467 IPC has no manner of application so far as the
present case is concerned. Barring an averment that the
petitioner is the Chief Executive Officer of Axis Bank, no role
whatsoever has been ascribed to the petitioner in the
transactions that has been made by the Opposite Party with the
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Axis Bank. Merely because the petitioner happened to be the
Chief Executive Officer, he cannot be impleaded as an accused in
view of the fact that the provisions of IPC does not postulate any
vicarious liability.
Summoning of an accused in a criminal case is a
serious matter. Criminal law cannot be set into motion as a
matter of course. The order of the learned Magistrate
summoning the accused must reflect that he has applied his
mind to the facts of the case and the law applicable thereto. The
learned Magistrate also has to examine the nature of the
allegations made in the complaint and the evidence both oral and
documentary in support thereof and determine as to whether the
same would be sufficient for the complainant to succeed in
bringing home the charge against the accused. The learned
Magistrate also has to carefully scrutinise the evidence brought
on record and then examine if any offence had been committed
by any of the accused. In the instant case, it is apparent that the
allegations made by the Opposite Party do not make out any
contravention of the provision as alleged and as such the learned
Magistrate by holding that a prima facie case has been made out
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against the petitioner regarding commission of offences
punishable under Sections 409/420/467 IPC by him is clearly
unwarranted and is a product of non-application of mind to the
facts as disclosed in the impugned complaint. In such
circumstances, continuance of the impugned proceedings on the
basis of such order issuing process against the petitioner is a
gross abuse of the process of court.
While issuing process against the petitioner, the
learned Magistrate remained completely oblivious about the
mandatory provisions of Section 202 of the Code of Criminal
Procedure. Section 202 of the Code of Criminal Procedure clearly
requires in a case where the accused person is situated outside
the territorial jurisdiction of the court, an enquiry is to be
conducted in terms of the mandatory provisions of Section 202 of
the Code of Criminal Procedure. The learned Magistrate while
issuing process gave a complete go-bye to such mandatory
provisions of law and the same has occasioned a failure of
justice. The impugned petition of complaint and the materials on
record even if are accepted to be true and are taken to their
entirety, the same do not disclose the essential ingredients of the
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offences punishable under Sections 409/420/467 IPC in respect
of the present petitioner. The impugned criminal proceedings is
manifestly attended with an ulterior motive for wreaking
vengeance on the petitioner with an oblique motive and/or for an
extraneous purpose and is out and out a harassment proceeding.
Just as liberty is precious for the individual, so is the
interest of the society in maintaining law and order. Both are
extremely important for the survival of a civilized society.
Sometimes in the larger interest of the public and State, it
becomes solely imperative to curtail freedom of an individual for a
certain period, and only then the non-bailable warrant should be
issued. The impugned orders dated 20.11.2010 and 22.9.2011
are wholly illegal on such yardstick. Though there cannot be any
straitjacket formula for issuance of warrants but as a general
rule, unless an accused is charged with the commission of an
offence of a heinous crime and it is feared that he is likely to
tamper or destroy the evidence or is likely to evade the process of
law, issuance of non-bailbale warrants ought to be avoided. The
power of issuing non bailable warrants being discretionary must
be exercised judiciously and with extreme care and caution. The
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court should properly balance both personal liberty and interest
before issuing warrants. The warrants, either bailable or non-
bailable, should never be issued without proper scrutiny of facts
and complete application of mind due to the extremely serious
consequences and ramifications which ensue on issuance of
warrants.
I have heard the learned Counsel for the parties at
length.
The learned Counsel for the Petitioner contended that
this is a fit case where the Hon'ble court can pass an order of
quashing the proceedings pending in the learned Court below
because ex facie there appears to be no commission of offence by
the present petitioner.
The record shows that the service of notice to the
respondent was satisfactory but nobody cared to contest this
case on behalf of the Opposite Party.
In support of his contention learned Counsel for the Petitioner submits the following decisions.
In the case of Vaddarse Prabhakara Shetty vs. Asochem Synthetics & Anr. reported in E Cr. N 2009 (3) 305 (Cal) the 13 Hon'ble court propounded that a Chairman cum Managing Director of the bank cannot be fastened with vicarious liability in the matter of alleged commission of offence. So, the proceedings against him was quashed.
In another decision of Keki Hormusji Gharda & Ors. vs. Mehervan Rustom Irani & Ors. reported in (2009) 2 SCC (Cri) 1113 the Hon'ble court held that Office bearers like Directors of a limited company are therefore, not personally liable for commission of offence under the Indian Penal Code.
The learned Counsel for the Petitioner submits that 'vicarious liability' is not available in criminal case. This does not amount all offences under IPC. In support of his argument he cited before me the following decisions:
a) K V Kamath vs. Pradip Kr. Sureka & Ors. [2010 (2) CHN (Cal) 681]
b) Sharon Michael & Ors. vs. State of TN & Anr. [2009 (2) SCC (Cri) 103] and
c) R. Kalyani vs. Janak C. Mehta & Ors. [ JT 2008 (12) Supreme Court 279] 14 The learned Counsel for the Petitioner further contended that the pleadings in civil proceedings or the collateral proceedings can be looked into by the High Court while exercising inherent powers under Section 482 Code of Criminal Procedure.
In support of his contention he placed before me the following decisions:
a) Balai Bhusan Dutta & Anr. vs. State of W.B. & Anr.
[2009 (2) E Cr. N (Cal) 836]
b) All Cargo Movers (I) Ltd. & Ors. vs. Dhanesh Badarmal Jain [JT 2007 (12) Supreme Court 345] In 2009 (2) E Cr. N (Cal) 836, the Hon'ble court held that the growing tendency to convert civil disputes into criminal cases in order to create pressure must be deprecated and discouraged.
In JT 2007 (12) Supreme Court 345 (supra) the Hon'ble Apex Court propounded that breach of contract does not constitute a simplicitor and the complaint must disclose the necessary ingredients therefor.
Initial deception is wanting here.
15Therefore, considering the materials on record and the decisions referred before me, I am of the view that the continuance of the proceedings in the learned Court below will be a sheer abuse of process.
This being the position, I find merit in the petition. Accordingly, the revision stands allowed and the impugned proceedings being CRR 384 of 2008 pending before the learned Judicial Magistrate, 1st Class, 2nd Court, Siliguri, Darjeeling under Section 409/420/467 IPC and orders subsequently passed thereafter stand quashed.
Urgent Photostat certified copies, if applied for, be supplied according to rules.
(Toufique Uddin, J.)