Gujarat High Court
Rakesh Trilok Chand Gupta vs State Of Gujarat & on 10 April, 2017
Author: J.B.Pardiwala
Bench: J.B.Pardiwala
R/CR.MA/8925/2017 JUDGMENT
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
CRIMINAL MISC.APPLICATION (FOR QUASHING & SET ASIDE
FIR/ORDER) NO. 8925 of 2017
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE J.B.PARDIWALA
==========================================================
1 Whether Reporters of Local Papers may be allowed to
see the judgment ? YES
2 To be referred to the Reporter or not ?
YES
3 Whether their Lordships wish to see the fair copy of the
judgment ? NO
4 Whether this case involves a substantial question of law
as to the interpretation of the Constitution of India or
NO
any order made thereunder ?
==========================================================
RAKESH TRILOK CHAND GUPTA....Applicant(s)
Versus
STATE OF GUJARAT & 1....Respondent(s)
==========================================================
Appearance:
MR ND NANAVATY, SENIOR ADVOCATE FOR NANAVATY ADVOCATES,
ADVOCATE for the Applicant(s) No. 1
MR MITESH AMIN, PP WITH MS SHRUTI PATHAK, APP for the
Respondent(s) No. 1
==========================================================
CORAM: HONOURABLE MR.JUSTICE J.B.PARDIWALA
Date : 10/04/2017
Page 1 of 17
HC-NIC Page 1 of 17 Created On Tue Aug 15 20:15:43 IST 2017
R/CR.MA/8925/2017 JUDGMENT
ORAL JUDGMENT
1 By this application under Section 482 of the Code of Criminal Procedure, 1973, the applicant original accused No.2 seeks to invoke the inherent powers of this Court, praying for quashing of the First Information Report being C.R. No.I192 of 2016 registered with the Gandhidham 'A' Division Police Station, Gandhidham - Kachchh for the offence punishable under Sections 177, 406, 409, 419, 420, 465, 468, 471, 474, 477(A) and 120B of the Indian Penal Code and Sections 85(1)
(b)(c)(e)(f)(g) and 85(4) of the Gujarat Value Added Tax Act, 2003.
2 The First Information Report came to be lodged at the Gandhidham 'A' Division Police Station by the respondent No.2 serving as the 'Inspector of Commercial Tax', inter alia, alleging that the applicant evaded the tax liability of Rs.24,96,72,373/ by preparing false record, the goods were exported outside the State of Gujarat, and thereby, evading the Value Added Tax payable to the State of Gujarat.
3 Mr. N.D. Nanavaty, the learned senior counsel appearing for the applicant submitted that when a special statute is created by the legislature to deal with particular type of offences, even if for the similar Act, an offence is created in a general statute i.e. the Indian Penal Code, a provision of the general statute cannot be invoked. The second contention of Mr. Nanavaty is that under Section 88 of the Act, 2003, the investigation of the crime in question cannot be entrusted to the police machinery.
4 Mr. Nanavaty seeks to rely upon two decisions: One of the Supreme Court in the case of Sharat Babu Digumati vs. Govt. of NCT of Delhi [(2017) 2 SCC 18] and the another of the Punjab and Haryana High Court in the case of M/s. Mahalakshmi Spinners Ltd vs. State of Page 2 of 17 HC-NIC Page 2 of 17 Created On Tue Aug 15 20:15:43 IST 2017 R/CR.MA/8925/2017 JUDGMENT Haryana [2007 Cri. L.J. 429].
5 On the other hand, this application has been vehemently opposed by Mr. Mitesh Amin, the learned Public Prosecutor appearing on behalf of the State respondent.
6 Mr. Amin would submit that there is nothing in the statute i.e. the Value Added Tax Act, which provides the investigation to be carried out by a police officer. Mr. Amin seeks to rely upon the judgment of the Apex Court in the case of State of West Bengal vs. Narayan K. Patodia [(2000) 4 SCC 447]. Mr. Amin, placing reliance on the said decision of the Supreme Court, submits that in the absence of a prohibition in the statute prohibiting a police officer from carrying out investigation, when there are offences under the special statute and also under the general statute, the police can very well carry out the investigation. He submits that the allegations levelled against the applicant herein and the other coaccused are very serious. The tax evasion is to the tune of Rs.24 Crore and odd. He pointed out that many documents have been forged for the purpose of evasion of the tax liability. He submits that the investigation is at a very crucial stage and the police should be permitted to complete the same in accordance with law.
7 Having heard the learned counsel appearing for the parties and having considered the materials on record, the only question that falls for my consideration is whether the F.I.R. should be quashed.
8 Before adverting to the rival submissions canvassed on the either side, few relevant provisions of the Act should be looked into.
9 Section 85 of the Act provides for offences and penalties. It reads
Page 3 of 17
HC-NIC Page 3 of 17 Created On Tue Aug 15 20:15:43 IST 2017
R/CR.MA/8925/2017 JUDGMENT
as under:
"85. Offences and penalties.
(1) Whoever,
(a) not being a registered dealer, falsely represents that he is or was a registered dealer at the time when he sells or purchases goods;
(b) knowingly furnishes a false return where the amount of tax, which could have been evaded if the false return had been accepted as true, exceeds Rs. 1000;
(c) knowingly produces before the Commissioner, false tax invoice, bill, voucher, cashmemorandum, declaration, certificate or other document for claiming deduction or tax credit, the value of which exceeds Rs. 1000
(d) fails to pay tax as per the returns filed by him;
(e) knowingly keeps or produces false account;
(f) issues to any person certificate or declaration under this Act, or a invoice, bill, cashmemorandum, voucher or other document which he knows or has reason to believe to be false;
(g) willfully attempts, in any manner whatsoever, to evade tax leviable under this Act; shall on conviction, be punished with imprisonment for a term which shall not be less than six months but which may extend to three years and with fine of rupees twenty thousand.
(2) Whoever
(a) carries on business as a dealer without being registered in contravention of section 21; or
(b) fails without sufficient cause to furnish any information required by section 26; or
(c) fails to surrender his certificate of registration as provided in subsection (9) of section 27; or
(d) fails without sufficient cause to furnish any returns as required by section 29 by the date and in the manner prescribed; or
(e) without reasonable cause, contravenes any of the provisions of section 31; or
(f) fails without sufficient cause, when directed so to do under section 62 to keep any accounts or record, in accordance with the directions; or Offences and penalties.
(g) fails without sufficient cause, to comply with any requirements made of him under section 67, or obstructs any officer making inspection or search or seizure under that section; or Page 4 of 17 HC-NIC Page 4 of 17 Created On Tue Aug 15 20:15:43 IST 2017 R/CR.MA/8925/2017 JUDGMENT
(h) obstructs or prevents any officer performing any function under this Act; or
(i) being owner or incharge of a goods vehicle fails, neglects or refuses to comply with any of the requirements contained in section 67 or 68,
(j) issues to another registered dealer tax invoice, retail invoice, bill or cash memorandum with the intention to defraud the Government revenue or with the intention that the Government may be defrauded of its revenue, shall, on conviction, be punished with imprisonment for a term which may extend to one year and with fine of rupees twenty thousand. (3) Subject to the provision of section 97, if any Government servant discloses any particulars referred to in subsection (1) of section 92, he shall, on conviction, be punished with imprisonment for a term which may extend to six months and with fine.
(4) Whoever aids or abets any person in commission of any act specified in subsections (1) or (2) shall on conviction, be punished with rigorous imprisonment which shall not be less than three months but which may extend to one year and with fine of rupees twenty thousand. (5) Whoever commits any of the acts specified in subsections (1) to (3) and the offence is a continuing one under any of the provisions of these sub sections, shall, on conviction, be punished with daily fine which shall not be less than rupees five hundred during the period of the continuance of the offence, in addition to the punishments provided under this section. (6) Where a dealer is guilty of an offence specified in subsections (1) and (2), the person to be the manager of the business of such dealer under section 65 shall also be deemed to be guilty of such offence, unless he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission thereof."
10 Section 87 of the Act is with regard to the cognizance of offences. It reads as under:
"87. Cognizance of offences.
(1) No court shall take cognizance of any offence under this Act or the rules except with the previous sanction of the Commissioner, and no court inferior to that of a Metropolitan Magistrate shall try any such offence. (2) Notwithstanding anything contained in the Code of Criminal Procedure, 1973, all offences punishable under this Act or the rules shall be cognizable and bailable."
11 Section 88 of the Act is with regard to the investigation of Page 5 of 17 HC-NIC Page 5 of 17 Created On Tue Aug 15 20:15:43 IST 2017 R/CR.MA/8925/2017 JUDGMENT offences. It reads as under:
"88. Investigation of offences.
(1)Subject to such conditions as may be prescribed, the Commissioner may authorise either generally or in respect of a particular case or class of cases any officer or person subordinate to him to investigate all or any of the offences punishable under this Act.
(2) Every officer or person so authorized shall, in the conduct of such investigation, exercise the powers conferred by the Code of Criminal Procedure, 1973 upon an officer incharge of a police station for the investigation of a cognizable offence."
12 The plain reading of Section 85 of the Act referred to above would indicate that some of the offences with which the applicant herein has been charged is found both in Section 85 of the Value Added Tax Act and also under the Indian Penal Code. However, from the record, it can clearly be seen that in addition to the offences which are common in both the statute, the F.I.R. is also registered for certain offence under Sections 406, 409, 420, 465, 468, 471, 474, 477(A) and 120B of the Indian Penal Code.
13 A similar question fell for consideration before the Supreme Court in the case of State of West Bengal (supra). In the said case, under the West Bengal Sales Tax Act, a provision was made that the investigation under the said offence was to be carried out by the Bureau of Investigation. In the said case also, a complaint was presented by the Assistant Commissioner of Commercial Taxes to the Deputy Superintendent of Police, who in turn, forwarded it to the officer in charge of the police station, for starting the investigation for the offences punishable under Sections 403, 409, 465, 468, 471, 419 and 420 read with Section 120B of the Indian Penal Code and Sections 88(1) (b), (6) and (7) of the Sales Tax Act, 1994 treating as F.I.R. The registration of Page 6 of 17 HC-NIC Page 6 of 17 Created On Tue Aug 15 20:15:43 IST 2017 R/CR.MA/8925/2017 JUDGMENT the said F.I.R. came to be challenged before the Calcutta High Court. The Calcutta High Court holding that the investigation could not have been carried out by anyone except the Bureau of Investigation, as constituted under the said Act, quashed and set aside the proceedings. The State of West Bengal went in appeal before the Supreme Court. The Supreme Court, while setting aside the judgment of the Calcutta High Court, has observed in paras 16, 17, 18 and 19 which read thus: "16. The offence envisaged in subsection (6) is specifically created as supplemental to any other penalty provided by any law for the time being in force. This means, offences falling under the Indian Penal Code and committed by a person while committing the offence contemplated in sub section (6) cannot get displaced for the sole reason that the accused has committed the offence falling under sub section (6) of Section 88.
17. Section 7(1) of the Sales Tax Act empowers the State government to constitute a Bureau of Investigation for discharging the functions referred to in subsection (3) thereof. It empowers the Bureau to carry on the investigation or hold enquiry into any case or alleged or suspected case of evasion of tax or malpractice created thereof and send a report of it to the Commissioner. A reading of Section 7 makes it clear that creation of Bureau of Investigation for the purpose of discharging the function envisaged in subsection (3) which, of course, includes investigation also. But there is nothing in Section 7 that such investigation can be carried on "only" by the Bureau and not any other investigating agency. It is open to the Bureau to get the assistance of any other legally constituted investigating agency for effectively inquiring into all the ramifications of the offence. As in this case if offences falling under the Indian Penal Code or any other enactment are also detected during the course of investigation conducted by the Bureau there is no inhibition to pass over the investigation to the regular police.
18. If the view of the learned single judge gets approval it would lead to startling consequences. The consequences of such an interpretation would be that if the person who commits the offence under Section 88 of the Act also commits other serious offences falling under Indian Penal Code as part of the same transaction neither the regular police nor any special police force nor even the Central Bureau of Investigation can be authorised to conduct investigation. The accused in such cases would then be well ensconced insulated from the legal consequences of proper and effective investigation. Criminal justice would be the serious casualty then.
Page 7 of 17
HC-NIC Page 7 of 17 Created On Tue Aug 15 20:15:43 IST 2017
R/CR.MA/8925/2017 JUDGMENT
19. That apart, how could the FIR be quashed if the investigating agency should have been different? By lodging FIR alone no investigation is conducted by the police. It is the first step towards starting investigation by the police. If High Court was of the opinion that investigation has to be conducted by the Bureau then also there was no need to quash the FIR. Any way we take the view that as offences under the Indian Penal Code are also involved, efficacious investigation can be conducted by entrusting it to the police investigating agency. Inherent powers of the High Court as recognised in Section 482 of the Code are reserved to be used "to give effect to any orders under the Code, or to prevent abuse of the process of any court or otherwise to secure the ends of justice." It is quite unfortunate that learned single judge overlooked the reality that by quashing the FIR in the case the High Court did not achieve any one of the above factors. On the contrary, the result of quashing the FIR had rendered the allegation of offences made against a person to remain consigned in stupor perennially. Hence, instead of achieving ends of criminal justice, the impugned order would achieve the reverse of it."
14 The facts of the present case are almost identical to the one with the facts of the case which were before the Supreme Court in the case of State of West Bengal (supra). Not only that, but in the present case, Section 88 does not provide that the investigation shall be carried out only for the offences of the Value Added Tax Act. In that view of the matter, the present case, even on facts, is squarely covered by the judgment of the Supreme Court in the case of State of West Bengal (Supra).
15 The Supreme Court in State of West Bengal (supra) has in clear terms held that merely because the accused has committed an offence falling under the special statue would not mean that the offences under the Indian Penal Code would get displaced. As already discussed hereinabove, the applicant herein has been charged for the offence punishable under Sections 409, 420, 465, 471, etc. of the Indian Penal Code, which are not common with any of the offences, as provided under the Value Added Tax Act.
Page 8 of 17
HC-NIC Page 8 of 17 Created On Tue Aug 15 20:15:43 IST 2017
R/CR.MA/8925/2017 JUDGMENT
16 In the case of Institute of Chartered Accountants of India vs.
Vimal Kumar Surana and another [(2011) 1 SCC 534], the Supreme Court considered the question whether the provisions contained in Sections 24, 24A and 26 of the Chartered Accountants Act, 1949 would operate as a bar against the prosecution of a person who is charged with the allegations, which constitute an offence or offences under other laws, including the Penal Code. The Supreme Court, while taking the view that a person can be charged under the provisions of both the Chartered Accountants Act, 1949 and the Penal Code, observed as under:
"20 In other words, if the particular act of a member of the Institute or a non member or a company results in contravention of the provisions contained in Section 24 or sub section (1) of Sections 24A, 25 or 26 and such act also amounts criminal misconduct which is defined as an offence under the IPC, then a complaint can be filed by or under the order of the Council or of the Central Government under Section 28, which may ultimately result in imposition of the punishment prescribed under Section 24 or subsection (2) of Section 24A, 25 or 26 and such member or non member or company can also be prosecuted for any identified offence under the IPC.
21 The object underlying the prohibition contained in Section 28 is to protect the persons engaged in profession of chartered accountants against false and untenable complaints from dissatisfied litigants and others. However, there is nothing in the language of the provisions contained in Chapter VII from which it can be inferred that Parliament wanted to confer immunity upon the members and non members from prosecution and punishment if the action of such member or non member amounts to an offence under the IPC or any other law.
22 The issue deserves to be considered from another angle. If a person cheats by pretending to be some other person, or by knowingly substituting one person for another, or representing that he or any other person is a person other than he or such other person really is (Section 416 IPC), then he can be charged with the allegation of cheating by personation and punished under Section 419 for a term which may extend to 3 years or with fine or both. If a person makes any false document with the intent to cause damage or injury to the public or to any person, or to support any Page 9 of 17 HC-NIC Page 9 of 17 Created On Tue Aug 15 20:15:43 IST 2017 R/CR.MA/8925/2017 JUDGMENT claim or title, then he can be prosecuted for an offence of forgery (Section
463) and can be punished under Section 465 with imprisonment which may extend to 2 years or with fine or with both. If a person commits forgery for the purpose of intending that the document forged by him shall be used for the purpose of cheating then he can be punished with imprisonment for a term which may extend to 7 years and fine (Section
468). If a person makes or counterfeits any seal, plate or other instrument for making an impression, intending that the same shall be used for committing any forgery which would be punishable under Section 467 or with such intent, in his possession any such seal, plate or other instrument, knowing the same to be counterfeit then he is liable to be punished with imprisonment for life or with imprisonment which may extend to 7 years. He shall also be liable to fine.
23 The provisions contained in Chapter VII of the Act neither define cheating by personation or forgery or counterfeiting of seal, etc. nor provide for punishment for such offences. If it is held that a person acting in violation of Section 24 or contravening subsection (1) of Section 24A and 26 of the Act can be punished only under the Act even though his act also amounts to one or more offence(s) defined under the IPC and that too on a complaint made in accordance with Section 28, then the provisions of Chapter VII will become discriminatory and may have to be struck down on the ground of violation of Article 14.
24 Such an unintended consequence can be and deserves to be avoided in interpreting Sesctions 24A, 25 and 26 keeping in view the settled law that if there are two possible constructions of a statute, then the one which leads to anomaly or absurdity and makes the statute vulnerable to the attack of unconstitutionality should be avoided in preference to the other which makes it rational and immune from the charge of unconstitutionality. That apart, the Court cannot interpret the provisions of the Act in a manner which will deprive the victim of the offences defined in Sections 416, 463, 464, 468 and 471 of his right to prosecute the wrong doer by filing the first information report or complaint under the relevant provisions of Cr.P.C.
25 We may add that the respondent could have been simultaneously prosecuted for contravention of Sections 24, 24A and 26 of the Act and for the offences defined under the IPC but in view of the bar contained in Article 20(2) of the Constitution read with Section 26 of the General Clauses Act, 1897 and Section 300 Cr.P.C., he could not have been punished twice for the same offence."
17 I have to my advantage a decision of the Punjab and Haryana Page 10 of 17 HC-NIC Page 10 of 17 Created On Tue Aug 15 20:15:43 IST 2017 R/CR.MA/8925/2017 JUDGMENT High Court rendered in the case of Sharanjit Singh vs. State of Punjab [Criminal Miscellaneous Application No.29107 of 2013 decided on 21st December 2013]. In the said case also, the contention on behalf of the Bank was that the provisions of the VAT Act and the Indian Penal Code cannot be invoked simultaneously, in respect of the same offence. A learned Single Judge of the High Court, while rejecting such contention, observed as under;
"14. Secondly, the issue itself, that just because a particular statute governs a particular issue and therefore, proceedings cannot be initiated for violation of any other statute, also does not hold good in my opinion, as what the Punjab Vat Act deals with, is only evasion of tax and the penalties etc. that are to be levied, in case such evasion is proved. However, the fabrication of the documents itself being an offence punishable under the provisions of the IPC, in my opinion, there is no reason why, for the commission of such offence alone, proceedings under the IPC would not be maintainable against the petitioner."
18 In taking the aforesaid view, the learned Single Judge relied upon the decision of the Supreme Court in the case of Institute of Chartered Accountants of India (supra) referred to above.
19 Let me now deal with the two decisions relied upon by Mr. Nanavaty, in support of his submissions.
20 In Sharat Babu(supra), the appellant therein and others were arraigned as accused in an F.I.R. for the offence punishable under Sections 292 and 294 of the Indian Penal Code and Section 67 of the Information Technology Act, 2000. At the end of the investigation, chargesheet was filed for the said offence. The argument before the Supreme Court was that the Information Technology Act is a special enactment and has special provisions. Section 292 of the I.P.C. talks Page 11 of 17 HC-NIC Page 11 of 17 Created On Tue Aug 15 20:15:43 IST 2017 R/CR.MA/8925/2017 JUDGMENT about the offence of sale, etc., of obscene books. The Supreme Court took notice of Section 81 of the I.T. Act which reads as under:
"81. Act to have overriding effect. The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force."
The Supreme Court, thereafter, proceeded to observe as under:
"28. Having noted the provisions, it has to be recapitulated that Section 67 clearly stipulates punishment for publishing, transmitting obscene materials in electronic form. The said provision read with Section 67A and 67B is a complete code relating to the offences that are covered under the IT Act. Section 79, as has been interpreted, is an exemption provision conferring protection to the individuals. However, the said protection has been expanded in the dictum of Shreya Singhal (supra) and we concur with the same. Section 81 also specifically provides that the provisions of the Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force. All provisions will have their play and significance, if the alleged offence pertains to offence of electronic record. It has to be borne in mind that IT Act is a special enactment. It has special provisions. Section 292 of the IPC makes offence sale of obscene books, etc. but once the offence has a nexus or connection with the electronic record the protection and effect of Section 79 cannot be ignored and negated. We are inclined to think so as it is a special provision for a specific purpose and the Act has to be given effect to so as to make the protection effective and true to the legislative intent. This is the mandate behind Section 81 of the IT Act. The additional protection granted by the IT Act would apply. In this regard, we may refer to Sarwan Singh and Anr. V. Kasturi Lal [(1977) 1 SCC 750. The Court was considering Section 39 of Slum Areas (Improvement and Clearance) Act, 1956 which laid down that the provisions of the said Act and the rules made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any other law. The Delhi Rent Control Act, 1958 also contained nonobstante clauses. Interpreting the same, the Court held: "When two or more laws operate in the same field and each contains a non obstante clause stating that its provisions will override those of any other law, stimulating and incisive problems of interpretation arise. Since statutory interpretation has no conventional protocol, cases of such conflict have to be decided in reference to the object and purpose of the laws under consideration.
Page 12 of 17
HC-NIC Page 12 of 17 Created On Tue Aug 15 20:15:43 IST 2017
R/CR.MA/8925/2017 JUDGMENT
A piquant situation, like the one before us, arose in Shri Ram Narain v. Simla Banking & Industrial Co. Ltd. [AIR 1956 SC 614], the competing statutes being the Banking Companies Act, 1949 as amended by Act 52 of 1953, and the Displaced Persons (Debts Adjustment) Act, 1951. Section 45A of the Banking Companies Act, which was introduced by the amending Act of 1953, and Section 3 of the Displaced Persons Act, 1951 contained each a nonobstante clause, providing that certain provisions would have effect "notwithstanding anything inconsistent therewith contained in any other law for the time being in force ...".
This Court resolved the conflict by considering the object and purpose of the two laws and giving precedence to the Banking Companies Act by observing:
"It is, therefore, desirable to determine the overriding effect of one or the other of the relevant provisions in these two Acts, in a given case, on much broader considerations of the purpose and policy underlying the two Acts and the clear intendment conveyed by the language of the relevant provisions therein" (p. 615) As indicated by us, the special and specific purpose which motivated the enactment of Section 14A and Chapter IIIA of the Delhi Rent Act would be wholly frustrated if the provisions of the Slum Clearance Act requiring permission of the competent authority were to prevail over them. Therefore, the newly introduced provisions of the Delhi Rent Act must hold the field and be given full effect despite anything to the contrary contained in the Slum Clearance Act."
29. In Talchar Municipality v. Talcher Regulated Market Committee [(2004) 6 SCC 178], the Court was dealing with the question whether the Orissa Municipal Act, 1950 or Orissa Agricultural Produce Markets Act, 1956 should apply. Section 4(4) of the 1956 Act contained a non obstante clause. In that context, the Court opined: "The Act, however, contains special provisions. The provision of Section 4(4) of the said Act operates notwithstanding anything to the contrary contained in any other law for the time being in force. The provisions of the said Act, therefore, would prevail over the provisions of the Orissa Municipal Act. The maxim "generalia specialibus non derogant" would, thus, be applicable in this case. (See D.R. Yadav v. R.K. Singh, 2004(1) S.C.T. 223 : (2003) 7 SCC 110, Indian Handicrafts Emporitum v. Union. of India, (2003) 7 SCC 589 and M.P. Vidyut Karamchari Sangh v. M.P. Electricity Board, 2004(2) S.C.T. 277: (2004) 9 SCC 755).
Page 13 of 17
HC-NIC Page 13 of 17 Created On Tue Aug 15 20:15:43 IST 2017
R/CR.MA/8925/2017 JUDGMENT
30. In Ram Narain (supra), the Court faced a situation where both the statutes, namely, Banking Companies Act, 1949 and the Displaced Persons (Debuts Adjustment) Act, 1951 contained nonobstante clause. The Court gave primacy to the Banking companies Act. To arrive at the said conclusion, the Court evolved the following principle: "7. ... It is, therefore, desirable to determine the overriding effect of one or the other of the relevant provisions in these two Acts, in a given case, on much broader considerations of the purpose and policy underlying the two Acts and the clear intendment conveyed by the language of the relevant provisions therein."
31 In Slidaire India Ltd. v. Fairgrowth Financial Services Ltd., 2001(2) R.C.R. (Civil) 198 : (2001) 3 SCC 71, this Court while dealing with two special statutes, namely, Section 13 of Special Court (Trial of Offences Relating to Transactions in Securities) Act, 1992 and Section 32 of Sick Industrial Companies (Special Provisions) Act, 1985, observed as follows: "Where there are two special statutes which contain non obstante clauses the later statute must prevail. This is because at the time of enactment of the later statute, the Legislature was aware of the earlier legislation and its non obstante clause. If the Legislature still confers the later enactment with a non obstante clause it means that the Legislature wanted that enactment to prevail. If the Legislature does not want the later enactment to prevail then it could and would provide in the later enactment that the provisions of the earlier enactment continue to apply."
32. The aforesaid passage clearly shows that if legislative intendment is discernible that a latter enactment shall prevail, the same is to be interpreted in accord with the said intention. We have already referred to the scheme of the IT Act and how obscenity pertaining to electronic record falls under the scheme of the Act. We have also referred to Section 79 and 81 of the IT Act. Once the special provisions having the overriding effect do cover a criminal act and the offender, he gets out of the net of the IPC and in this case, Section 292. It is apt to note here that electronic forms of transmission is covered by the IT Act, which is a special law. It is settled position in law that a special law shall prevail over the general and prior laws. When the Act in various provisions deals with obscenity in electronic form, it covers the offence under Section 292 IPC.
33. In Jeewan Kumar Raut v. CBI 2009 (3) R.C.R. (Criminal) 586 :
Page 14 of 17HC-NIC Page 14 of 17 Created On Tue Aug 15 20:15:43 IST 2017 R/CR.MA/8925/2017 JUDGMENT 2009(4) Recent Apex Judgments (R.A.J.) 336 : (2009) 7 SCC 526, in the context of Transplantation of Human Organs Act, 1994 (TOHO) treating it as a special law, the Court held: "22. TOHO being a special statute, Section 4 of the Code, which ordinarily would be applicable for investigation into a cognizable offence or the other provisions, may not be applicable. Section 4 provides for investigation, inquiry, trial, etc. according to the provisions of the Code. Subsection (2) of Section 4, however, specifically provides that offences under any other law shall be investigated, inquired into, tried and otherwise dealt with according to the same provisions, but subject to any enactment for the time being in force regulating the manner or place of investigating, inquiring into, tried or otherwise dealing with such offences.
23. TOHO being a special Act and the matter relating to dealing with offences thereunder having been regulated by reason of the provisions thereof, there cannot be any manner of doubt whatsoever that the same shall prevail over the provisions of the Code."
And again: "27. The provisions of the Code, thus, for all intent and purport, would apply only to an extent till conflict arises between the provisions of the Code and TOHO and as soon as the area of conflict reaches, TOHO shall prevail over the Code. Ordinarily, thus, although in terms of the Code, the respondent upon completion of investigation and upon obtaining remand of the accused from time to time, was required to file a police report, it was precluded from doing so by reason of the provisions contained in Section 22 of TOHO."
The Supreme Court, ultimately, took the view that the High Court had fallen into error in taking the view that although the charge had not been made out under Section 67 of the I.T. Act, yet the police could have proceeded under Section 292 of the Indian Penal Code.
21 What is important in the decision of the Supreme Court referred
Page 15 of 17
HC-NIC Page 15 of 17 Created On Tue Aug 15 20:15:43 IST 2017
R/CR.MA/8925/2017 JUDGMENT
to above is the ratio that if the special Act has an overriding effect like the one under the Information Technology Act, then it makes all the difference. Once the special provisions having the overriding effect do cover a criminal act and the offender, he gets out of the net of the Indian Penal Code. The Supreme Court laid emphasis on the three provisions of the Information Technology Act i.e. Sections 67, 79 and 81. In the Gujarat Value Added Tax Act, 2003, there is no provision providing any overriding effect on any other law for the time being in force. What weighed with the Supreme Court was the fact that the provisions of the Information Technology Act deal with obscenity in electronic form and the same covers the offence under Section 292 of the Indian Penal Code.
22 It cannot be said, by any stretch of imagination, that Section 85 of the Gujarat Value Added Tax Act, 2003 covers the offences punishable under Sections 177, 406, 409, 419, 420, 465, 468, 471, 474, 477 and 120B of the Indian Penal Code.
23 In my view, the issue is squarely covered by the Supreme Court in the case of State of West Bengal (supra). The decision of the Punjab and Haryana High Court in the case of Mahalakshmi Spinners (supra) relied upon has also no application to the case on hand. In the said case, the accused was charged with the offence punishable under Section 135 of the Electricity Act i.e. for theft of electricity and also under Section 379 of the Indian Penal Code. Section 379 of the Indian Penal Code deals with punishment for a simple case of theft. The Punjab and Haryana High Court took the view that when there is a specific / special law covering the question of theft of electricity i.e. Section 135 of the Act, the general law contained in Section 379 of the Indian Penal Code will not be applicable. This ratio is not applicable to the facts of the Page 16 of 17 HC-NIC Page 16 of 17 Created On Tue Aug 15 20:15:43 IST 2017 R/CR.MA/8925/2017 JUDGMENT present case.
24 The matter is still at the stage of investigation. The Investigating Officer is otherwise duty bound to act in accordance with law in support of the prosecution case before the chargesheet is filed.
25 For the foregoing reasons, this application fails and is hereby rejected.
(J.B.PARDIWALA, J.) chandresh Page 17 of 17 HC-NIC Page 17 of 17 Created On Tue Aug 15 20:15:43 IST 2017