Madras High Court
Shanthi Radhakrishnan vs State Rep. By on 24 November, 2016
Author: P.Velmurugan
Bench: P.Velmurugan
IN THE HIGHCOURT OF JUDICATURE AT MADRAS Date of Reservation : 24.11.2016 Date of Pronouncement: 01.06.2017 CORAM: THE HONOURABLE MR.JUSTICE P.VELMURUGAN Criminal Revision Case No.1095 of 2016 and Crl.M.P.Nos.9476 and 9477 of 2016 Shanthi Radhakrishnan .... Petitioner/A4 versus State rep. By The Inspector of Police, CBI/EOW/Chennai (RC.No.5/E/2006) ... Respondent Prayer: Criminal revision petition filed under Section 397 read with 401 of Cr.P.C., to call for the records and set aside the order dated 21.07.2016 in Crl.M.P.No.1255 of 2016 in C.C.No.3186 of 2007 passed by the Additional Chief Metropolitan Magistrate, Egmore @ Chennai 3 and discharge the petitioner. For Petitioner : Mr.B.Sundar Mohan For Respondent : Mr.K.Srinivasan, Special P.P. For CBI Cases ORDER
This criminal revision petition has been filed to set aside the order dated 21.07.2016 in Crl.M.P.No.1255 of 2016 in C.C.No.3186 of 2007 passed by the Additional Chief Metropolitan Magistrate, Egmore @ Chennai and discharge the petitioner.
2.The brief facts of the prosecution case are as follows:
A1 and A2 are private limited companies promoted by A3 and A4 and these companies were engaged in the manufacture of self-closing values and design pressure regulators for LPG Cylinders. These items were manufactured to supply to three Oil Companies namely IOC, BCL & HPCL based on their purchase orders. The companies availed the facility from the Indian Overseas Bank viz., Supply Bills Purchase facility to the tune of Rs.65 lakhs each for A1 and A2 companies, for which, A1 and A2 had to produce the bills raised on the oil companies supported with lorry receipts and inspection certificate of Bureau of India Standard and a covering letter. Further, during the period from April 2003 to October 2003, out of 93 bills discounted for M/s.Intech Engineering (A1) Company and only 35 Bills were realised and payments for remaining 58 Bills were not received by the bank and out of 59 bills purchased for M/s.Spec Engineering (A2) company, only 16 bills were realised and remaining re bill were unpaid and thus, the total amount due for both the companies was Rs.2.43 crores. Entire primary and collateral securities offered by the companies were sold and an amount of Rs.224 lakhs were recovered and according to the prosecution, the total outstanding of A1 and A2 was Rs.280 lakhs including interest. It is the further case of the prosecution that A1 and A2 companies had negotiated and arrived at one time settlement as per which, the entire dues were paid. Therefore, a case has been registered against A1 to A4 for the offences under Sections 120(B), 420 and 471 of I.P.C. During the pendency of the matter, all the four accused filed quash petition in Crl.O.P.No.6128 of 2009 and this Court was pleased to quash the proceedings by order dated 22.07.2010 on the ground that the entire dues payable to Indian Overseas Bank was settled by applying the principles laid down by the Hon'ble Apex Court in the case of Nikhil Merchant Vs. CBI & Another reported in (2008) 3 SCC (Cri.) 858. However, the respondent challenged the said order before the Apex Court in S.L.P.Crl.No.259 of 2011, which was later converted into C.A.No.161 of 2016 and the Hon'ble Apex Court was pleased to set aside the order of this Court and allowed the criminal appeal, giving liberty to the accused to urge available legal grounds praying for discharge before the trial Court. Therefore, A4 has filed the discharge application stating that she was a house wife and hence, she cannot be vicariously liable for the offences. However, after hearing both sides, the learned Additional Chief Metropolitan Magistrate passed order dated 21.07.2016, dismissing the discharge petition filed by the petitioner. Against which, the present criminal revision petition has been filed.
3.The learned counsel for the petitioner would submit that there is no specific overt act attributed to this petitioner/A4 and as such, the charge against the petitioner/A4 is groundless. There is no overt act specifically attributed to the petitioner/A4 except for the fact that she is the Director of A1 company and Managing Director of A2 company. When the company is an accused, the vicarious liability of the Managing Director or Director will arise only when there is any provision fixing such vicarious liability on the managing Director or Director. The offences have been committed by the companies and the criminal role of the petitioner/A4 is not explained by the prosecution and there is no documents for showing that this petitioner/A4 has actually participated in the criminal activities. He would further submit that the name of the petitioner/A4 is not found place in the first information report and she has been implicated only in the charge sheet.
4.The main contention of the petitioner/A4 is that there is no vicarious liability in criminal law except when there is a provision fixing such vicarious liability on the Managing Director or Director. In support of the said contention, the learned counsel for the petitioner relied on the decisions of the Hon'ble Supreme Court reported in (2008) 5 Supreme Court Cases 662 S.K.Alagh V. State of U.P., (2010) 10 Supreme Court Cases 479 Maharashtra State Electricity Distribution Co. Ltd V. Datar Switchgear and (2015) 4 Supreme Court Cases 609 Sunil Bharti Mittal V. CBI, wherein the Apex Court has held that the Code does not cast vicarious liability on a party not directly charged for commission of an offence, unless specifically provided therefor.
5.Per contra, the learned Special Public Prosecutor would submit that on a careful perusal of the witnesses statements, it will clearly establish that the accused including this petitioner/A4 raised bogus bills and discounted with the bank without actually manufacturing and sending the finished products to various plants of oil companies. On investigation, it is also revealed that two transporters, whose names were figuring in the 101 invoices i.e. M/s.Shanthi Cargo Carriers and M/s.Amman Transport were non-existing and fictitious. The oral evidence given by L.Ws.50, 51 and 59 will establish M/s.Shanthi Cargo Carriers belongs to this petitioner/A4 and the same was functioning only on paper and hence, there are sufficient materials to frame the charges against the petitioner/A4.
6.He would further submit that A1 and A2 companies are represented by A3 and A4 respectively and this petitioner/A4 and his husband A3 have raised bogus bills and discounted with the bank without actually manufacturing and sending the finished products to various plants of oil companies. This petitioner/A4 is a Director of A1 Company and Managing Director of A2 company and she has committed the offences under Sections 420 and 471 of I.P.C. and also the petitioner/A4 was also charged for the offences under Sections 120(B) read with 420 and 471 of I.P.C. and the authorities cited by the learned counsel for the petitioner are not applicable to the facts of the present case.
7.Heard the learned counsel appearing for the petitioner and the learned Special Public Prosecutor appearing for the respondent and perused the materials available on record along with the order passed by the learned Additional Chief Metropolitan Magistrate, Egmore.
8.On a careful perusal of the charge sheet filed under Section 173 of Cr.P.C. along with other material documents and dismissal order of the learned Special Judge would show that there are incriminating materials to proceed against the petitioner and other accused. In the above facts and circumstances, at this stage, the trial Court is not expected to conduct a roving enquiry.
9.At the stage of framing of charge, what the Court has to see is whether the material brought on record would reasonably connect the accused with the crime. No more is required to be inquired into. Only prima facie case is to be seen, the question whether the charges have been proved or not can be determined only after the evidence is recorded in this case. For framing of charge, the Judge has to consider judicially whether on consideration of the materials on record it can be said that the accused has been reasonable probability or chance of the accused being found guilty. If the answer is affirmative, the Judge will be at liberty to frame a charge against the accused.
10.Further, it is well settled principles of law that at the time of considering the discharge application before framing of charges, the Court ought to have seen whether there is any prima-facie case made out for framing of charge and the Special Court need not to conduct any roving enquiry regarding the oral and documentary evidence collected by the prosecution. The Special Court considering all the materials collected during the investigation found that there is prima facie case as against the petitioners and other accused to frame the charges. The validity and admissibility of the oral and documentary evidence can be done only after the trial and not at the stage of framing of charges and at the time of framing of charges, the probative value of the material on record cannot be gone into.
11.There is no quarrel over the proposition laid down in the decision relied on by the learned counsel for the petitioner. However, in this case, though the name of the petitioner was not found in the first information report, subsequent, after investigation, her name has been implicated in the charge sheet. It is needless to say that first information report is not an encyclopedia. If the investigation officer, during the investigation, found any materials to implead other persons, they can be impleaded, when sufficient incriminating materials are available against those persons. Admittedly, this petitioner is the Director of A1 company and Managing Director of A2. 161(3) of Cr.P.C. statement of some of the witnesses clearly stated about the involvement of this petitioner in the offence. Therefore, considering all the materials, the trial Court found that there are incriminating materials are available against this petitioner. Therefore, I am of the view that the trial Court has correctly come to the conclusion that there is prima facie case made out as against the petitioner and others to frame charges and at this stage, the order passed by the Special Court cannot be interfered by exercising the revisional jurisdiction under Section 397 read with 401 of I.P.C.228
12.At this stage, it is worthwhile to refer the decision of the Hon'ble Supreme Court reported in 2017 CRI.L.J.1433 State of Rajasthan V. Fatehkaran Mehdu, wherein, the Apex Court has dealt with the same issue and has held in paras 26 to 29 as follows:
26. The scope of interference and exercise of jurisdiction under Section 397 of Cr.P.C. has been time and again explained by this Court. Further, the scope of interference under Section 397 Cr.P.C. at a stage, when charge had been framed, is also well settled. At the stage of framing of a charge, the court is concerned not with the proof of the allegation rather it has to focus on the material and form an opinion whether there is strong suspicion that the accused has committed an offence, which if put to trial, could prove his guilt. The framing of charge is not a stage, at which stage final test of guilt is to be applied. Thus, to hold that at the stage of framing the charge, the court should form an opinion that the accused is certainly guilty of committing an offence, is to hold something which is neither permissible nor is in consonance with scheme of Code of Criminal Procedure.
27. Now, reverting to the limit of the scope of jurisdiction under Section 397 Cr. P.C., which vests the court with the power to call for and examine the records of an inferior court for the purposes of satisfying itself as to the legality and regularity of any proceedings or order made in a case. The object of this provision is to set right a patent defect or an error of jurisdiction or law or the perversity which has crept in the proceeding.
28. It is useful to refer to judgment of this Court in Amit Kapoor and Ramesh Chander and Another, (2012) 9 SCC 460, where scope of Section 397 Cr. P.C. have been succinctly considered and explained. Para 12 and 13 are as follows:
"12. Section 397 of the Code vests the court with the power to call for and examine the records of an inferior court for the purposes of satisfying itself as to the legality and regularity of any proceedings or order made in a case. The object of this provision is to set right a patent defect or an error of jurisdiction or law. There has to be a well-founded error and it may not be appropriate for the court to scrutinize the orders, which upon the face of it bears a token of careful consideration and appear to be in accordance with law. If one looks into the various judgments of this Court, it emerges that the revisional jurisdiction can be invoked where the decisions under challenge are grossly erroneous, there is no compliance with the provisions of law, the finding recorded is based on no evidence, material evidence is ignored or judicial discretion is exercised arbitrarily or perversely. These are not exhaustive classes, but are merely indicative. Each case would have to be determined on its own merits. 13. Another well-accepted norm is that the revisional jurisdiction of the higher court is a very limited one and cannot be exercised in a routine manner. One of the inbuilt restrictions is that it should not be against an interim or interlocutory order. The Court has to keep in mind that the exercise of revisional jurisdiction itself should not lead to injustice ex facie. Where the Court is dealing with the question as to whether the charge has been framed properly and in accordance with law in a given case, it may be reluctant to interfere in exercise of its revisional jurisdiction unless the case substantially falls within the categories aforestated. Even framing of charge is a much advanced stage in the proceedings under the CrPC.
29. The Court in para 27 has recorded its conclusion and laid down principles to be considered for exercise of jurisdiction under Section 397 particularly in context of quashing of charge framed under Section Cr. P. C. Para 27, 27(1), (2), (3), (9), (13) are extracted as follows:
"27. Having discussed the scope of jurisdiction under these two provisions, i.e., Section 397 and Section 482 of the Code and the fine line of jurisdictional distinction, now it will be appropriate for us to enlist the principles with reference to which the courts should exercise such jurisdiction. However, it is not only difficult but is inherently impossible to state with precision such principles. At best and upon objective analysis of various judgments of this Court, we are able to cull out some of the principles to be considered for proper exercise of jurisdiction, particularly, with regard to quashing of charge either in exercise of jurisdiction under Section 397 or Section 482 of the Code or together, as the case may be:
27.1) Though there are no limits of the powers of the Court under Section 482 of the Code but the more the power, the more due care and caution is to be exercised in invoking these powers. The power of quashing criminal proceedings, particularly, the charge framed in terms of Section 228 of the Code should be exercised very sparingly and with circumspection and that too in the rarest of rare cases.
27.2) The Court should apply the test as to whether the uncontroverted allegations as made from the record of the case and the documents submitted therewith prima facie establish the offence or not. If the allegations are so patently absurd and inherently improbable that no prudent person can ever reach such a conclusion and where the basic ingredients of a criminal offence are not satisfied then the Court may interfere.
27.3) The High Court should not unduly interfere. No meticulous examination of the evidence is needed for considering whether the case would end in conviction or not at the stage of framing of charge or quashing of charge.
27.9) Another very significant caution that the courts have to observe is that it cannot examine the facts, evidence and materials on record to determine whether there is sufficient material on the basis of which the case would end in a conviction; the Court is concerned primarily with the allegations taken as a whole whether they will constitute an offence and, if so, is it an abuse of the process of court leading to injustice.
27.13) Quashing of a charge is an exception to the rule of continuous prosecution. Where the offence is even broadly satisfied, the Court should be more inclined to permit continuation of prosecution rather than its quashing at that initial stage. The Court is not expected to marshal the records with a view to decide admissibility and reliability of the documents or records but is an opinion formed prima facie.
13.Considering the facts and circumstances along with the above said decision, I am of the view that the trial Court has correctly come to the conclusion that there is prima facie case made out as against the petitioner and others to frame charges and there is no imperative or illegality in the order passed by the learned Additional Chief Metropolitan Magistrate and the same does not warrant any interference by this Court, by exercising the revisional jurisdiction under Section 397 read with 401 of Cr.P.C. and this criminal revision fails and the same is liable to be dismissed.
14.In the result, this criminal revision case is dismissed. Consequently, connected miscellaneous petitions are also dismissed.
01.06.2017 Arul P.VELMURUGAN, J.
Arul To
1.The Inspector of Police, CBI/EOW/Chennai
2.The Additional Chief Metropolitan Magistrate, Egmore @ Chennai 3.
Criminal Revision Case No.1095 of 2016 and Crl.M.P.Nos.9476 and 9477 of 2016 01.06.2017