Gujarat High Court
Geetaben Manishkumar Shah vs State Of Gujarat on 15 March, 2018
Author: J.B.Pardiwala
Bench: J.B.Pardiwala
R/SCR.A/212/2018 JUDGMENT
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CRIMINAL APPLICATION NO. 212 of 2018
With
R/SPECIAL CRIMINAL APPLICATION NO. 1051 of 2018
With
R/SPECIAL CRIMINAL APPLICATION NO. 313 of 2018
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE J.B.PARDIWALA
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1 Whether Reporters of Local Papers may be allowed to Yes
see the judgment ?
2 To be referred to the Reporter or not ? Yes
3 Whether their Lordships wish to see the fair copy of the No
judgment ?
4 Whether this case involves a substantial question of law No
as to the interpretation of the Constitution of India or any
order made thereunder ?
Circulate this judgement in the subordinate judiciary.
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GEETABEN MANISHKUMAR SHAH
Versus
STATE OF GUJARAT
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Appearance:
MR BHARAT T RAO(697) for the PETITIONER(s) No. 1,2
MR. MITESH AMIN, LD. PUBLIC PROSECUTOR WITH MS. MOXA
THAKKR, APP for the RESPONDENT(s) No. 1
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CORAM: HONOURABLE MR.JUSTICE J.B.PARDIWALA
Date : 15/03/2018
ORAL JUDGMENT
Page 1 of 42
R/SCR.A/212/2018 JUDGMENT
1. As the issues raised in all the captioned petitions are inter-related, those were heard analogously and are being disposed of by this common judgment and order.
2. The Special Criminal Application No.212 of 2018 has been filed by the writ applicants-original accused under Article 226 of the Constitution of India with the following prayers;
"(A) Your Lordships may be pleased to admit/allow this Application;
(B)Your Lordships may be pleased to quash and set aside the complaint being C.R. No. I-3/2017 filed before Gandhinagar Zone Police Station for the alleged offences punishable under Sections 406, 409, 420, 467, 468, 471, 474 and 120-B of the Indian Penal Code r/w. Sections 3, 4, 5 and 6 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978 r/w. Section-3 of the Gujarat Protection of Interest Depositors (In Financial Establishments) Act, 2003, for the reasons stated in the Memo of application and in the interest of justice; OR IN THE ALTERNATIVE (B) Your Lordships may be pleased to issue writ of mandamus or any other appropriate writ, order or direction by quashing and setting aside the invocation of provisions of Section-3 of Gujarat Protection of Interest Depositors (In Financial Establishments) Act, 2003, in view of the specific contentions raised by the petitioners that police authority has no authority to register the complaint under the said Act, for the reasons stated in the Memo of application and in the interest of justice;
(C ) Pending admission, hearing and final disposal of the above petition, Your Lordships be pleased to stay the further investigation in respect of complaint being CR. No. 1-3/ 2017 filed before Gandhinagar Zone Police Station for the alleged offences punishable under Sections 406, 409, 420, 467, 468, 471, 474 and 120-B of the Indian Penal Code r/w. Sections 3, 4, 5 and 6 of the Prize Chits and Money Circulation Schemes (Banning) Page 2 of 42 R/SCR.A/212/2018 JUDGMENT Act, 1978 r/w. Section-3 of the Gujarat Protection of Interest Depositors (In Financial Establishments) Act, 2003, for the reasons stated in the Memo of application and in the interest of justice;
OR IN THE ALTERNATIVE (C) Pending admission, hearing and final disposal of the above petition, Your Lordships be pleased to restrain the police officer from taking coercive steps/affecting arrest of the petitioners, in connection with the complaint being C.R. No. I-3/2017 filed before Gandhinagar Zone Police Station for the alleged offences punishable under Sections 406, 409 420, 467, 468, 471, 474 and 120 B of the Indian Penal Code r/w. Sections 3, 4, 5 and 6 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978 r/w. Section-3 of the Gujarat Protection of Interest Depositors (In Financial Establishments) Act, 2003, for the reasons stated in the memo of the petition and in the interest of justice.
(D) The Hon'ble Court may kindly be pleased to grant any other appropriate relief as the nature circumstances of the case may require."
3. The Special Criminal Application No.313 of 2018 has been filed by the writ applicant with the following prayers;
"(A) Your Lordships may be pleased to admit/allow this Application;
(B) Your Lordships may be pleased to issue appropriate writ, order or direction, directing the respondent police authorities to register the complaint/FIR pursuant to the detailed application given by the petitioner (Annexure-B), for the reasons stated in the Memo of application and in the interest of justice;
(C ) Pending admission, hearing and final disposal of the above petition, Your Lordships be pleased to direct the respondent authorities to register the complaint/FIR pursuant to the detailed application given by the petitioner, for the reasons stated in the Memo of application and in the interest of justice;
Page 3 of 42R/SCR.A/212/2018 JUDGMENT (D) The Hon'ble Court may kindly be pleased to grant any other appropriate relief as the nature circumstances of the case may require;"
4. The Special Criminal Application No.1051 of 2018 has been filed by the writ applicant with the following prayers;
"(A) To issue a writ of mandamus or a writ in the nature of mandamus or any other appropriate writ, order or direction, directing the respondent nos.2 & 3 to personally look into the matter and ensure that the petitioner and his family members are not harassed by Gandhinagar Zone Police Station, C.I.D. Crime by frequently visiting the residence of the petitioner, searching the house and calling upon the petitioner for recording his statement by issuing summons u/s.160 of Cr.P.C in connection with complaint being C.R.No.I/3/2017 on 10.11.2017 registered with Gandhinagar Zone Police Station under Sec.12OB, 406, 409, 420, 467, 468, 471,
474. and Sec.3, 4, 5, 6 of The Prize Chits and Money Circulation Schemes (Banning) Act,1978 and Sec.3 of The Gujarat Protection of Interest of Depositors (In Financial Establishments) Act, 2003 for the reasons stated in the Memo of Petition and in the interest of justice and fairness of things.
(B) Pending admission, hearing and final disposal of the above Special Criminal Application, to restrain the respondent no.4 from issuing summons u/s. 160 of Cr.P.C. To the petitioner for recording statement as the petitioner has already given his statements and is ready and willing to extend all cooperation to the police in the investigation.
(C ) The Hon'ble Court may kindly be pleased to grant any other appropriate relief as the nature circumstances of the case may require;
(D) To award the cost of this petition."
5. Let me first deal with the Special Criminal Application Page 4 of 42 R/SCR.A/212/2018 JUDGMENT No.212 of 2018.
6. This writ application was heard by this Court for quite some time. The question of law involved in this writ application is with regard to the interpretation of the provisions of the Gujarat Protection of Interest of Depositors (In Financial Establishments) Act, 2003, more particularly, sections 3,4,9, 10 and 17.
7. On conclusion of the hearing of this writ application, Mr. B.T. Rao, the learned counsel appearing for the writ applicants made a request that he may be permitted to withdraw the writ application as instructed by his clients.
8. Considering that a neat question of law is involved in the matter as regards the interpretation of section 17(2) of the Act, 2003, I declined to grant such permission but with an understanding that I would only address myself on the question of law and would not enter into the merits of the matter.
9. On 10th November, 2017, one first information report came to be lodged by one Rajendrakumar Hirabhai Parmar, I.e,. the respondent No.2 herein before the Gandhinagar Zone Police Station being C.R. No.I-3 of 2017 for the offence punishable under sections 406, 409, 420, 467, 468, 471, 474 and 120B of the IPC, sections 3,4,5 and 6 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978 r/w. Section-3 of the Gujarat Protection of Interest Depositors (In Financial Establishments) Act, 2003 (for short the Act 2003). In Page 5 of 42 R/SCR.A/212/2018 JUDGMENT the first information report, the writ applicants are the original accused Nos.1 and 2 respectively. There are other persons also named as co-accused in the first information report. Apprehending arrest at the hands of the police, the writ applicants herein preferred the Criminal Misc. Application No. 3094 of 2017 in the court of the learned Principal Sessions Judge, Ahmedabad (Rural) under section 438 of the Cr.P.C and prayed for anticipatory bail. The 3rd Addl. S Sessions Judge, Ahmedabad (Rural), Mirzapur, by an order dated 15th December, 2017, rejected the anticipatory bail application substantially on the ground of its maintainability in view of section 17()2) of the Act, 2003. To put it in other words, the court below took the view that by virtue of section 17(2) of the Act, 2003, the Designated Court has been denuded of its powers under section 438 of the Cr.P.C. to grant anticipatory bail. Although, there is no specific bar to grant anticipatory bail so far as the offence under the IPC and the Act, 1978 is concerned, yet, as the first information report has been lodged also for the offence punishable under the Act, 2003, the court below took the view that section 17(2) of the Act, 2003 has taken away the powers of the court to grant anticipatory bail.
10. Thus, the question of law that falls for my consideration is whether section 17(2) of the Act, 2003 prohibits the Designated Court from exercising its powers under section 438 of the Cr.P.C for grant of anticipatory bail.
11. Let me look into the object and reasons of the Act, 2003 as well as few provisions of the Act, 2003 for the purpose of answering the above referred question.
Page 6 of 42R/SCR.A/212/2018 JUDGMENT "STATEMENT OF OBJECT AND REASONS There has been, in recent years, a mushroom growth of financial establishments in the State. Many such establishments secure deposits from the public, mostly middle class and poor, by promising highly attractive interest rates or rewards but without making due provision for refunding the deposits to the depositors on maturity or without any enforcing provision for rendering services in kind in return, as promised. Many financial establishments have defaulted in returning the deposits on maturity or in paying interest or in rendering the services in kind in return, as assured to the public. As such it ha resulted in great public resentment and uproar creating law and order problem in the State. It is, therefore, considered necessary to make a suitable special legislation to protect the interest of depositors and to curb the unscrupulous activities of such financial establishments in the State of Gujarat.
This bill seeks to achieve the aforesaid object.
The following notes on clauses explain the important provisions of the Bill-
Clause-1 This clause provides for short title and commencement of the Act.
Clause-2 This clause defines certain terms used in the Bill.
Clause -3 This clause provides for the punishment to the extent of six years and with fine upto ten lacs of rupees to the promoter, partner, director, manager or any other person or an employee of the Financial Establishment for fraudulently default in any repayment of deposits on maturity along with other benefits.
Clause-4- This clause empowers the State Government to make an order in the Official Gazette, to protect the interest of the depositors of such Financial Establishments which are in default in the payment of the deposit on Financial Establishments and also provides that all moneys, properties and assets of the Financial Establishment shall vest in the Competent Page 7 of 42 R/SCR.A/212/2018 JUDGMENT Authority on publication of the order under sub-clause (1) of this clause.
Clause-5 This clause provides for the appointment of the Competent Authority by the State Government and for powers to be exercises by it, the procedure to be adopted by the Competent Authority after issuance of the order made under sec.4 and also provides that the Competent Authority may also apply to the Special Court or Designated Court or other judicial forum for the adjudication of any issue or subject matter pertaining to moneys, properties or assets, for passing appropriate orders to give effect to the provision of the Act.
Clause-6 This clause provides for the duties and powers of the Competent Authority , for taking possession of all the moneys, properties and assets of the Financial Establishments.
Clause -7 This clause provides for the procedure to be adopted by the Competent Authority for the assessment of assets and deposit, liabilities and preparation of a statement of dues of Financial Establishment, which is due from various debtors, list of depositors and their respective dues.
Clause-8 This clause provides that the Competent Authority shall make an application to the Designated Court seeking permission to make payment to the depositors out of the moneys realised, disbursement of the moneys as per the orders of Designated Court.
Clause-9 This clause empowers the State Government to constitute Designated Court of the level of the Court of District and Session Judge. It also provides for the jurisdiction of the Designated Court so constituted and transfer of cases pending before any Court to the Designated Court.
Clause-10 This clause provides for the powers of the Designated Court regarding issue of notices to the Page 8 of 42 R/SCR.A/212/2018 JUDGMENT Financial Establishment or the persons whose moneys or properties or assets is attached by the State Government an the procedure to be followed fr attachment of the property by the Designated Court.
Clause-11 This clause provides for the powers of the Designated Court to give direction as it deem fit to the competent authority for effective implementation of the provisions of the Act and pass appropriate orders for realisation of property, asset of the Financial Establishments and the payment to the depositors of such Financial Establishment and for matters incidental thereto.
Clause 12 This clause empowers the Designated Court for the attachment of those property which have been transferred not n good faith and not for adequate consideration by the Financial Establishments.
Clause 13 This clause provides that Financial Establishment may apply to the Designated Court and ask for the permission for giving security in lieu of attachment of moneys, properties or assets.
Clause 14 This clause empowers the Designated Court to pass orders for the proper administration of the money, properties, and assets, attached and vested in the Competent Authority, as may be reasonably necessary for the maintenance of applicant and his family and for safeguarding the interest of any business affected by such attachment.
Clause 15 This clause contains provisions for appeal.
Clause 16 This clause provides for the appointment of Special Public Prosecutor by the State Government for the purpose of conducting the cases in the Designated Court.
Clause 17 This clause provides for the procedure to be adopted by the Designated Court for the trial of Page 9 of 42 R/SCR.A/212/2018 JUDGMENT offences.
Clause 18 This clause provides that the provisions of the Act shall prevail over the provisions of other laws.
Clause 19 This clause provides for usual indemnity for Acts done in good faith.
Clause 20 This clause empowers the State Government to make rules for carrying out the purposes of the Act.
Clause 21 This clause empowers the State Government to remove difficulty that may arise within a period of three years from the date of commencement of the Act."
12. The entire scheme of the Act, 2003 is to provide for the recovery of deposits of the defaulting financial establishments when it involves section of public at large consisting of small depositors. It came to the notice of the State Government that many of the financial establishments, not covered by the RBI Act, 1934, received deposits from the innocent public on the promise of giving exorbitant interest and deceived the depositors without discharging their obligations to make payment of the deposit on maturity. On account of which, the public resentment ran high which culminated in law and order problem in the State. Therefore, the State Government thought fit to come out with this public interest legislation to regulate the activities of such financial establishments. The primary object of the Act is to secure the interest of the depositors by attaching the properties on default to make payment on maturity and selling away the attached properties for the purpose of distribution of the sale proceeds among the depositors.
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13. Section 3 of the Act, 2003 makes the fraudulent defaults by the Financial Establishment an offence punishable with imprisonment for a term which may extend to six years and with fine which may extend to 10 Lacs of rupees. Section 3 is extracted hereunder;
"3. Fraudulent defaults by Financial Establishment.
- Any Financial Establishment, which fraudulently defaults any repayment of deposit on maturity alongwith any benefit in the form of interest, bonus, profit or in any other form as promised or fraudulently fails to render service as assured against the deposit, every person including the promoter, partner, director, manager or any other person or an employee responsible for the management of or conducting of the business or affairs of such Financial Establishment shall, on conviction, be punished with imprisonment for a term which may extend to six years and with fine which may extend to ten lakhs of rupees and such Financial Establishment also shall be liable for a fine which may extend to ten lakhs of rupees: Provided that in the absence of special and adequate reasons recorded in the judgement of the court, the imprisonment shall not be less than three years and the fine shall not be less than one lakh of rupees and in case of imposition of fine on Financial Establishment, it shall not be less than five lakhs of rupees. Explanation. - For the purpose of this section, a Financial Establishment, which commits default in repayment of such deposit with such benefits in the form of interest, bonus, profit or in any other form as promised or fails to render any specified service promised against such deposit, or fails to render any specific service agreed against the deposit with an intention of causing wrongful gain to one person or wrongful loss to another person or commits such defaults due to its inability arising out of impracticable or commercially non-viable promises made while accepting such deposit or arising out of deployment of money or assets acquired out of the deposits in such a manner as it involves inherent risk in recovering the same when needed shall be deemed to Page 11 of 42 R/SCR.A/212/2018 JUDGMENT have committed a default or failed to render the specific service, fraudulently."
14. Let me make a note of few salient features of the Act, 2003. On receipt of a complaint from the depositors or otherwise alleging that a financial establishment has defaulted in returning the deposits even after the period of maturity or defaulted in paying the interest on the deposits made by the investors, the Government would take a serious note of such a complaint and would deal with the affairs of the financial institution to find whether the grievance of such depositors matches with the intention on the part of the financial to defraud them. In case the Government comes to a decision that there is no likelihood of return of the deposit or non- payment of the interest by the financial establishment concerned, the Government has the power to pass an ad- interim order of attachment not only of the money but also of other properties procured either in the name of the financial institution or in the name of any other person from out of the corpus of the deposit made by the aggrieved investors. The Government has taken upon itself as the responsibility by the special legislation to protect the interest of the depositors. Such a power of the Government to go in for ad-interim attachment of the properties of the defaulting financial establishment is provided under section 4 of the Act, 2003. Section 4 is extracted hereunder;
"4. Attachment of properties on default of return of deposit. - (1) Notwithstanding anything contained in any other law for the time being in force, -
(i) Where upon complaint received from the depositor or Page 12 of 42 R/SCR.A/212/2018 JUDGMENT otherwise, the State Government is satisfied that any Financial Establishment has failed,-
(a) to return the deposit on maturity on demand by the depositor; or
(b) to pay interest or other assured benefit; or
(c) to provide the service promised against such deposit; or
(ii) Where the State Government has reason to believe that any Financial Establishment is acting in a calculated manner detrimental to the interest of the depositors with an intention to defraud them;
and if the State Government is satisfied that such Financial Establishment is not likely to return the deposits or make payment of interest or other benefits assured or to provide the services against which the deposit is received, the State Government may, in order to protect the interest of the depositors of such Financial Establishment, after recording the reasons in writing, issue an order by publishing it in the Official Gazette, for attaching the money, property or assets belonging to or believed to have been acquired by such Financial Establishment either in its own name or in the name of any other person from out of the deposits collected by the Financial Establishment, or if it transpires that such moneys, properties or assets, is not available for attachment or not sufficient for repayment of the deposits, such other property or assets of the said Financial Establishment or of the promoter, director, partner or member of the said establishment as the State Government may think fit.
(2) On publication of the order under sub-section (1), all the moneys, properties and assets of the Financial Establishment and of the person mentioned therein shall forthwith vest in the Competent Authority pending further order from the Designated Court.
(3) The Collector of a district shall be competent within his jurisdiction to receive the complaint under sub- section (1) and he shall forward such complaint along with his report to the State Government at the earliest and shall send a copy of the complaint to the concerned Superintendent of Police or Commissioner of Police, as Page 13 of 42 R/SCR.A/212/2018 JUDGMENT the case may be, for investigation. "
15. Under section 5 of the Act, 2003, the Government is empowered to appoint the Competent Authority to exercise control over the properties attached by the Government and transferred to the custody of the competent authority in terms of section 4 of the Act. Although section 5(2) of the Act, 2003 reads that the Competent Authority shall have such other power as may be necessary for carrying out the purposes of the Act, yet, the said provision does not mean that the Competent Authority shall have all the powers necessary for carrying out the purposes of this Act. The phrase "such other powers" has been purposely employed by the legislature to mean that he has the authority to exercise his powers for the equitable distribution of the proceeds of the properties attached and brought to auction. By no stretch of imagination, section 5(2) would mean that the Competent Authority, who is not well versed in the nuances of the investigation process, has been vested with the power to investigate the matter. As already pointed out, the main purpose of the Act is not to punish the defaulters in making repayment of the deposit of maturity. Section 6 of the Act is a necessary consequential evil arising out of the default made by the Financial Institutions.
16. Let me now go to the relevant provisions to examine whether the Designated Court has been denuded of its powers to grant anticipatory bail under section 438 of the Cr.P.C. Section 9 provides for constitution of a Designated Court for the purpose of trying the offence under the Act 2003. Section 9 is extracted hereunder;
Page 14 of 42R/SCR.A/212/2018 JUDGMENT "9. Designated Court. - (1) For the purposes of this Act, the State Government may, with the concurrence of the Chief Justice of the High Court of Gujarat, by notification, in the Official Gazette, constitute one or more Designated Court of the level of the Court of a District and Sessions Judge for such area or for such case or group of cases or such class as may be specified in the notification. (2) No Court, other than the Designated Court shall have jurisdiction to deal with or decide any question which the Designated Court is empowered to deal with or decide by or under this Act.
(3) Any case or proceeding pending before any Court or any authority in relation to the moneys, properties or assets of the Financial Establishment covered by an order made under section 4, shall stand transferred to the respective Designated Court and shall be dealt with and decided by such Court in accordance with the provisions of this Act."
17. The plain reading of section 9 would indicate that the State Government, in consultation with the Chief Justice of the High Court would constitute one or more Designated Court of the level of the Court of a District and Sessions Judge for such area or for such case or group of cases or such class as may be specified in the notification. Section 9(2) makes it further clear that no Court other than the Designated Court shall have the jurisdiction to deal with or decide any question which the Designated Court is empowered to deal with or decide by or under the Act. Section 9(3) further provides that any proceeding pending before any Court in relation to the moneys, properties or assets of the Financial Establishment covered by an order made under section 4 of the Act shall stand transferred to the Designated Court.
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18. Section 17 of the Act is extracted hereunder;
"17. Procedure and powers of Designated Court regarding offences. - (1) The Designated Court may take cognizance of the offence without the accused being committed to it for trial and, in trying the accused person, shall follow the procedure prescribed in the Code of Criminal Procedure, 1973 for the trial of warrant cases by Magistrates.
(2) The provisions of the Code of Criminal Procedure, 1973 (2 of 1974) except section 438 thereof shall, so far as may be, apply to the proceedings before a Designated Court and for the purposes of the said provisions a Designated Court shall be deemed to be a Magistrate."
19. The plain reading of section 17 of the Act would indicate that the committal proceedings usually taken up by the Judicial Magistrate concerned under the scheme of the Code of Criminal Procedure, 1973 has been dispensed with under section 17(1) of the Act. The Designated Court has been empowered to take cognizance of the offence without the accused being committed to it for trial. Section 17(1) of the Act further indicates that the Designated Court shall resort to the procedure prescribed by the Cr.P.C., 1973 for the trial of warrant cases by the Magistrates while trying the accused. Section 17(2) of the Act would further indicate that the provisions of the Cr.P.C., 1973, shall, so far as may be, apply to the proceedings before a Designated Court and for the purpose of the said provisions, a Designated Court shall be deemed to be a Magistrate Court. As far as the trial before the Designated Court is concerned, the Cr.P.C. has been made applicable specifically for the trial of the accused before it.
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20. Section 18 of the Act, 2003 reads as follows;
"18. Act to override other laws. - Save as otherwise provided in this Act, the provisions of this Act shall have effect notwithstanding anything inconsistent therewith, contained in any other law for the time being in force or any custom or usage."
21. Thus, the provisions of the Act 2003 shall have the overriding effect despite the fact that there is some inconsistent provisions found in the Cr.P.C or in any other law.
22. The court below, on plain interpretation of section 17(2) of the Act, took the view that the power to grant anticipatory bail under section 438 of the Cr.P.C., has been specifically excluded. To put it in other words, according to the court below, if an accused prays for anticipatory bail in connection with a first information report lodged for the offence under the Act, 2003, then the Designated Court has no powers to grant the same.
23. Mr. B.T. Rao, the learned counsel appearing for the applicants submitted that the interpretation of the court below as regards section 17(2) of the Act is not in accordance with law. According to Mr. Rao, the confusion has been created only on account of the words "except section 438". Mr. Rao submitted that, all that section 17(2) of the Act has tried to clarify is that the provisions of the Cr.P.C shall, so far as may be, apply to the proceedings before a Designated Court and as the procedure is to be adopted as one prescribed for the trial of the warrant cases, the Designated Court would be deemed Page 17 of 42 R/SCR.A/212/2018 JUDGMENT to be a Magistrate. Therefore, according to Mr. Rao, just because a Designated Court, by a deeming fiction, is to be considered as a Court of Magistrate, that by itself, will not make the Designated Court a Magisterial Court so as to denude the Designated Court of its power to grant anticipatory bail.
24. In such circumstances, referred to above, Mr. Rao prays that this Court may clarify or hold that the Designated Court has the power to consider an application under section 438 of the Cr.P.C, seeking anticipatory bail.
25. On the other hand, Mr. Amin, the learned Public Prosecutor appearing for the State submitted that having regard to the plain language of section 17(2) of the Act, and also the object and the reasons for the enactment of the Act, 2003, the Designated Court has been denuded of its powers to grant anticipatory bail under section 438 of the Cr.P.C. According to Mr. Amin, the language of the statute is very clear. Section 17(2) provides that the provisions of the Cr..P.C. except section 438 thereof shall apply to the proceedings before a Designated Court. According to Mr. Amin, there is a specific exclusion of the power of the Designated Court to consider the plea for anticipatory bail under section 438 of the Code. In such circumstances, referred to above, Mr. Amin prays that this Court may hold that the Designated Court has no powers to grant anticipatory bail under section 438 of the Code.
26. Having heard the learned counsel appearing for the Page 18 of 42 R/SCR.A/212/2018 JUDGMENT parties and having considered the materials on record, the only question that falls for my consideration is whether section 17(2) of the Act, 2003 imposes a restriction on the Designated Court with regard to exercise of power under section 438 of the Cr.P.C.
27. The Criminal Courts are normally constituted under the provisions of the Criminal Procedure Code. Section 6 of the Cr.P.C. 1973 provides for the classes of criminal courts. In addition to the provisions contained in the Code or the old Code of 1898, from time to time, different enactments have been passed providing that in respect of certain offences, there will be a Special Court or Designated Court manned by persons having specified qualifications. In the present case, I am concerned with such an enactment, namely, the Gujarat Protection of Interest of Depositors (In Financial Establishments) Act 2003 (for short the Act, 2003). The main bone of contention is the interpretation of section 17(2) of the Act.
28. According to Section 4 of the Cr. P.C., all the offences under the Indian Penal Code shall be investigated, enquired into, tried, and otherwise dealt with according to the provisions made therein. Sub-section (2) of Section 4 lays down that all offences under any other law shall be investigated, enquired 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 investigation, inquiring into, trying or otherwise dealing with such offences. Section 5 of the Cr.P.C. says that nothing contained in the Cr. P.C. shall, Page 19 of 42 R/SCR.A/212/2018 JUDGMENT in absence of a specific provision to the contrary, affect any special or local law for the time being in force, or any special jurisdiction or power conferred, or any special form of procedure prescribed, by any other law for the time being in force. Chapter II of the Cr.P.C. bears the heading Constitution of Criminal Courts and Offices. Section 6 of the Cr. P.C. which falls under this Chapter, says that besides the High Courts and the Courts constituted in any other law, other than this Code, there shall be, in every State, four classes of courts, namely, (i) Courts of Sessions; (ii) Judicial Magistrates of the first class and, in any Metropolitan areas, Metropolitan Magistrates; (iii) Judicial Magistrates of the second class; and (iv) Executive Magistrates. Section 26(a) of the Cr. P.C. says that subject to the provisions of the Cr. P.C., any offence under the Indian Penal Code may be tried by (i) the High Court, or (ii) the Court of Session; or (iii) any other Court by which such offence is shown in the First Schedule to be triable. Sub-clause (b) of the said subsection provides that any offence under any other law shall, when any Court is mentioned in this behalf in such law, be tried by such Court and when no Court is so mentioned may be tried by the High Court or any other courts, by which offence is shown in the First Schedule to be triable. Section 28 of the Cr. P. C. talks about the power to pass sentence by different classes of courts constituted under the Cr. P.C. including the Sessions Judge, Additional Sessions Judge and an Assistant Sessions Judge.
29. The jurisdiction of the criminal courts, other than those mentioned in the Cr. P.C.; to try a particular offence or otherwise to deal with it is derived from the Statute, which Page 20 of 42 R/SCR.A/212/2018 JUDGMENT creates the court or from the Statute which defines the offence. From the provisions of the Cr. P.C., as mentioned above, it is manifest that besides the four classes of criminal courts, it also contemplates constitution of the court under any other law. It is evident that wherever it deals with the jurisdiction and power of the court, care has been taken to maintain a separate identity of the special courts and permit them to function according to the procedure laid down in the Statute and in absence thereof to follow the procedure provided in the Cr. P.C.
30. The Courts of the Special Judge, constituted under the Act of 2003, are obviously a class of criminal courts beyond the four classes specifically mentioned in section 6 of the Cr.P.C. Such courts are, ordinarily, governed by the procedure prescribed for the trial of the offences and otherwise to deal with it, as provided in the statute, under which these courts are created.
31. Though the history of the legislation may not lead to a definite conclusion to find out the correct meaning of an expression but at times, it may be usefully employed for interpreting the meaning of the Statute. Similarly, the statements of the objects and reasons cannot control the actual words used in the Statute, yet it may be referred to for the purpose of ascertaining the conditions prevailing at the time, which necessitated the making of the law. I have referred to the objects and reasons for the enactment for the limited purpose as they have got some significance in the context of this case. The statements of objects and reasons of the Act, Page 21 of 42 R/SCR.A/212/2018 JUDGMENT 2003, as referred to above, clearly show the anxiety of the framers of law to curb luring innocent people in investing their hard earned money in the financial establishments with a promise to pay high attractive interest rates and to prevent the default on the part of such financial establishments in returning the deposits on maturity. This is the reason why a separate forum was created and a special procedure was prescribed to exclusively deal with it.
32. A literral rule of interpretation is one of the oldest methods of interpretation adopted by the judiciary.
33. Ex pra-ecedentibus et consequentibus optima fit interpretatio... the best interpretation is made from the things preceeding and following.
34. In Maxwell, on the interpretation of statute, at pages 27 and 28 of the 12th Edition, the principle is laid down thus;
"it is an elementary rule that construction is to be made of all parts together and not of one part only by itself. Such a survey is known indispensable even when the words are the plainest, for the true meaning of any passage is that which (being permissible) best harmonies with the subject and with every other passage of the statute."
35. In Maxwell on Interpretation of Statutes, Tenth Edn. at page 229, the following passage is found:
"Where the language of a statute, in its ordinary meaning and grammatical construction, leads to a manifest contradiction of the apparent purpose of the enactment, or to some inconvenience or absurdity, hardship or Page 22 of 42 R/SCR.A/212/2018 JUDGMENT injustice, presumably not intended, a construction may be put upon it which modifies the meaning of the words, and even the structure of the sentence. ... Where the main object and intention of a statute are clear, it must not be reduced to a nullity by the draftsman's unskilfulness or ignorance of the law, except in a case of necessity, or the absolute intractability of the language used."
36. In Seaford Court Estates Ltd. v. Asher, 1949-2 AII ER 155 at p. 164, Denning, L.J. said:
"When a defect appears a judge cannot simply fold his hands and blame the draftsman. He must set to work on the constructive task of finding the intention of Parliament ... and then he must supplement the written word so as to give 'force and life' to the intention of the legislature. A Judge should ask himself the question how, if the makers of the Act had themselves come across this ruck in the texture of it, they would have straightened it out? He must then do as they would have done. A judge must not alter the material of which the Act is woven, but he can and should iron out the creases."
37. Though the above observations of Lord Denning were disapproved in appeal by the House of Lords in 1951 (1) AII England Law Reports 839 (HL), Sarkar, J. speaking for the Constitution Bench in M. Pentiah v. Muddala Veeramallappa 1961 (2) SCR 295: (AIR 1961 SC 1107) adopted that reasoning of Lord Denning. Subsequently also, Beg, C.J. in Bangalore Water Supply and Sewerage Board v. A. Rajappa, AIR 1978 SC 548 approved the observations of Lord Denning stating thus :
(at p. 552 of 1978):
"Perhaps, with the passage of time, what may be described as the extension of a method resembling the 'arm-chair rule' in the construction of wills, Judges can more frankly step into the shoes of the legislature where an enactment leaves its own intentions in much too nebulous or uncertain a state."Page 23 of 42
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(emphasis supplied)
38. It will be befitting, in this context, to recall the view expressed by Judge Frank in Guise pi v. Walling, 144F (2nd) 608 pp. 620, p 622 (CCA 2d 1944) which is quoted in 60 Harvard Law Review 370. p. 372 reading thus:
"The necessary generality in the wordings of many statutes, and ineptness of drafting in others frequently compels the court, as best as they can, to fill in the gaps, an activity which no matter how one may label it, is in part legislative. Thus the courts in their way, as administrators perform the task of supplementing statutes. In the case of courts, we call it 'interpretation' or 'filling in the gaps; in the case of administrators we call it 'delegation' or authority to supply the details."
39. Subba Rao, C.J. speaking for the Bench in Chandra Mohan v. State of Uttar Pradesh, 1967(1) SCR 77: (AIR 1966 SC 1987) has pointed out that the fundamental rule of interpretation is that in construing the provisions of the Constitution or the Act of Parliament, the Court "will have to find out the express intention from the words of the Constitution or the Act, as the case may be ..." and eschew the construction which will lead to absurdity and give rise to practical inconvenience or make the provisions of the existing law nugatory.
40. A.P. Sen, J. in Organo Chemical Industries v. Union of India, 1980(1) SCR, 69: (AIR 1979 SC 1805) has stated thus: (at p. 1817 of AIR 1979) "A bare mechanical interpretation of the words 'devoid of concept or purpose' will reduce most of legislation to futility. It is a salutary rule, well established, that the intention of the legislature must be found by reading the statute as a whole."
41. Krishna Iyer, J. has pointed out in his inimitable style in Page 24 of 42 R/SCR.A/212/2018 JUDGMENT Chairman, Board of Mining Examination and Chief Inspector of Mines v. Ramjee, AIR 1977 SC 965. "To be literal in meaning is to see the skin and miss the soul of the Regulation."
42. It is true that normally the courts should be slow to pronounce the legislature to have been mistaken in its constantly manifested opinion upon a matter resting wholly within its will and take its plain ordinary grammatical meaning of the words of the enactment as affording the best guide, but to winch up the legislative intent, it is permissible for the courts to take into account of the ostensible purpose and object and the real legislative intent. Otherwise, a bare mechanical interpretation of the words and application of the legislative intent devoid of concept of purpose and object will render the legislature inane. In the cases of this kind, the question is not what the words in the relevant provision mean but whether there are certain grounds for inferring that the legislature intended to exclude the jurisdiction of the Designated Courts under the Act, 2003 from exercising powers under section 438 of the Cr.P.C. for the purpose of granting anticipatory bail to the accused. It is permissible for the courts to have functional approaches and look into the legislative intention and sometimes it may be even necessary to go behind the words and enactment and take other factors into consideration to give effect to the legislative intention and to the purpose and spirit of the enactment so that no absurdity or practical inconvenience may result in the legislative exercise and its scope and object may not become futile. (See Directorate of Enforcement vs. Deepak Mahajan, 1994 (3) SCC
440.) Page 25 of 42 R/SCR.A/212/2018 JUDGMENT
43. The principal submission of Mr. B.T. Rao, the learned senior counsel appearing for the applicants proceeds on the footing that as the Designated Court has to follow the procedure prescribed in the Cr.P.C for the trial of warrant cases by the Magistrates and as the Designated Court has been empowered to take cognizance of the offence without the accused being committed to it for trial, the provisions of the Cr.P.C in that regard have been made applicable before a Designated Court and only for the purposes of the said provisions, a Designated Court is deemed to be a Magistrate. Otherwise, for all practical purposes, a Designated Court would be a Court of the Sessions Judge. The submission is that according to section 9 of the Act, the Designated Court is manned by the District & Sessions Judge. What is sought to be clarified by the State Legislature in section 17(2) of the Act, which in fact was not necessary, is that as few provisions of the Cr.P.C are made applicable to the Designated Court treating the Designated Court to be a Court of Magistrate, it has been stated that except section 438, all other provisions of the Cr.P.C., as far as may be, shall apply to the proceedings before a Designated Court. To put it in other words, according to Mr. Rao, probably, what was in the mind of the State Legislature is that, as a Magistrate cannot exercise powers under section 438 of the Cr.P.C and it is only the Sessions Court, who can exercise the powers under section 438, and as a Designated Court is deemed to be a Court of Magistrate for the purpose of taking cognizance when the accused being committed, it thought fit to clarify by incorporating the words "except section 438".
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44. The entire argument inviting me to specifically decide whether a court of a Designated Judge, for a certain purpose, is a court of Magistrate or a court of Session revolves round a mistaken belief that a Designated Judge has to be one or the other, and must fit in the slot of a Magistrate or a Court of Session. Such an approach would strangulate the functioning of the court and must be eschewed. Shorn of all embellishment, the court of a Designated Judge is a court of original criminal jurisdiction. As a court of original criminal jurisdiction in order to make it functionally oriented some powers were conferred by the statute setting up the court. Except those specifically conferred and specifically denied, it has to function as a court of original criminal jurisdiction not being hide bound by the terminological status description of Magistrate or a Court of Session. Under the Code, it will enjoy all powers which a court of original criminal jurisdiction enjoys save and except the ones specifically denied. Without causing any violence to the words of section 17(2) of the Act, 2003, the plain reading of the same would indicate that the Court of the original criminal jurisdiction has been denuded of the power to grant anticipatory bail to an accused under section 438 of the Cr.P.C. To put it in other words, the power to grant anticipatory bail appears to have been specifically denied to the court of the original criminal jurisdiction.
45. After the pronouncement of a Constitution Bench decision in the case of A.R. Antulay vs. State of Maharashtra, AIR 1983 SC 684 there can now be no doubt that the Special Court under the Act will enjoy all the powers which a court of Page 27 of 42 R/SCR.A/212/2018 JUDGMENT original criminal jurisdiction enjoys where of a Magistrate or a court of sessions, save and except the one specifically denied. The passage from Antulay's case relevant for the present purpose reads thus at page 733-755 of AIR:
""It is, however, necessary to decide with precision and accuracy the position of a Special Judge and the Court over which he presides styled as the Court of a Special Judge because unending confusions have arisen by either assimilating him with a Magistrate or with a Sessions Court. The Prevention of Corruption Act, 1947 was enacted for more effective prevention of bribery and corruption. Years rolled by and experience gathered showed that unless a special forum for the trial of such offences as enumerated in the 1947 Act is created, the object underlying the 1947 Act would remain a distant dream. This led to the enactment of the Criminal Law accompanying the Bill refers to the recommendations of the Committee chaired by Dr. Bakshi Tek Chand appointed to review the working of the Special Police Establishment and to make recommendations for improvement of laws relating to bribery and corruption. To take the cases of corruption out of the maze of cases handled by Magistrates, it was decided to set up special courts. Section 6 conferred power on the State Government to appoint as many Special Judges as may be necessary with power to try the offences set out in clauses (a) and (b). Now if at this state a reference is made to Section 6 of the Code of Criminal Procedure which provides for constitution of criminal courts, it would become clear that a new court with a new designation was being set up and that it has to be under the administrative and judicial superintendence of the High Court. As already pointed out, there were four types of criminal courts functioning under the High Court. To this list was added the court of a Special Judge. Now when a new court which is indisputably a criminal court because it was not even whispered that the Court of Special Judge is not a criminal court, is set up, to make it effective and functionally oriented, it becomes necessary to prescribe its powers, procedure, status and all ancillary provisions. While setting up a court of a Special Judge keeping in view the fact that the high dignitaries in public life are Page 28 of 42 R/SCR.A/212/2018 JUDGMENT likely to be tried by such a court, the qualification prescribed was that the person to be appointed as a Special Judge has to be either a Sessions Judge, Additional Sessions Judge or Assistant Sessions Judge. These three dignitaries are above the level of a Magistrate. After prescribing the qualification, the Legislature proceeded to confer power upon a Special Judge to take cognizance of offences for the trial of which a Special court with exclusive jurisdiction was being set up. If a Special Judge has to take cognizance of offences, ipso facto the procedure for trial of such offences has to be prescribed. Now the Code prescribes different procedures for trial of cases by different courts. Procedure for trial of a case before a Court of Sessions is set out in Chapter XVIII; trial of warrant cases by Magistrates is set out in Chapter XIX and the provisions therein included catered to both the types of cases coming before the Magistrate, namely, upon police report or otherwise than on a police report. Chapter XX prescribes the procedure for trial of summons cases by Magistrates and Chapter XXI prescribes the procedure for summary trial. Now that a new criminal court was being set up, the Legislature took the first step of providing its comparative position in the hierarchy of courts under Section 6 Cr.P.C. by bringing it on level more or less comparable to the Court of Sessions, but in order to avoid any confusion arising out of comparison by level, it was made explicit in Section 8(1) itself that it is not a Court of Sessions because it can take cognizance of offences without commitment as contemplated by Section 193 Cr.P.C. Undoubtedly in Section 8(3) it was clearly laid down that subject to the provisions of sub-sections (1) and (2) of Section 8, the Court of Special Judge shall be deemed to be a Court of Session trying cases without jury or without the aid of assessors. In contra-distinction to the Sessions Court this new court was to be a court of original jurisdiction. The Legislature then proceeded to specify which out of the various procedures set out in the Code, this new court shall follow for trial of offences before it. Section 8(1) specifically says that a Special Judge in trial of offences before him shall follow the procedure prescribed in the Code of Criminal Procedure for trial of warrant cases by Magistrates. The provisions for trial of warrant cases by the Magistrate are to be found in Chapter XXI of 1898 Code. A glance through the provisions will show that the provisions therein included Page 29 of 42 R/SCR.A/212/2018 JUDGMENT catered to both the situations, namely, trial of a case initiated upon police report (Sec.251A) and trial of cases instituted otherwise than on police report (Sec. 252 to
257). If a Special Judge is enjoined with a duty to try cases according to the procedure prescribed in foregoing provisions he will have to first decide whether the case was instituted upon a police report or otherwise than on police report and follow the procedure in the relevant group of sections. Each of the Secs. 251A to 257 of 1898 Code which are in pari materia with Secs. 238 to 250 of 1973 Code refers to what the Magistrate should do. Does the Special Judge, therefore, become a Magistrate? This is the fallacy of the whole approach. In fact, in order to give full effect to Section 8(1), the only thing to do is to read Special Judge in Sections 238 to 250 wherever the expression `Magistrate' occurs. This is what is called legislation by incorporation. Similarly, where the question of taking cognizance arises, it is futile to go in search of the fact whether for purposes of Section 190 which conferred power on the Magistrate to take cognizance of the offence, Special Judge is a Magistrate? What is to be done is that one has to read the expression `Special Judge' in place of Magistrate, and the whole thing becomes crystal clear. The Legislature wherever it found the grey area clarified it by making specific provision such as the one in sub-section (2) of Section 8 and to leave no one in doubt further provided in sub-section (3) that all the provisions of the Code of Criminal Procedure shall so far as they are not inconsistent with the Act apply to the proceedings before a Special Judge. At the time when the 1952 Act was enacted what was in operation was the Code of Criminal Procedure, 1898. It did not envisage any Court of a Special Judge and the Legislature never wanted to draw up an exhaustive Code of Procedure for this new criminal court which was being set up. Therefore, it conferred power (taking cognizance of offences), prescribed procedure (trial of warrant cases by a Magistrate), indicated authority to tender pardon (Section 338) and then after declaring its status as comparable to a Court of Session proceeded to prescribe that all provisions of the Code of Criminal Procedure will apply in so far as they are not inconsistent with the provisions of the 1952 Act. The net outcome of this position is that a new court of original jurisdiction was set up and whenever a question arose as to what are its powers in respect of specific Page 30 of 42 R/SCR.A/212/2018 JUDGMENT questions brought before it as court of original criminal jurisdiction, it had to refer to the Code of Criminal Procedure undaunted by any designation claptrap. When taking cognizance, a Court of Special Judge enjoyed the powers under Section
190. When trying cases, it is obligatory to follow the procedure for trial of warrant cases by a Magistrate though as and by way of status it was equated with a Court of Session. The entire argument inviting us to specifically decide whether a court of a Special Judge for a certain purpose is a Court of Magistrate or a Court of Session revolves round a mistaken belief that a Special Judge has to be one or the other, and must fit in the slot of a Magistrate or a Court of Session. Such an approach would strangulate the functioning of the court and must be eschewed. Shorn of all embellishment, the court of a Special Judge is a court of original criminal jurisdiction. As a court of original criminal jurisdiction in order to make it functionally oriented some powers were conferred by the statute setting up the court. Except those specifically conferred and specifically denied, it has to function as a court of original criminal jurisdiction not being hide bound by the terminological status description of Magistrate or a Court of Session. Under the Code, it will enjoy all powers which a court of original criminal jurisdiction enjoys save and except the ones specifically denied."
46. The case of Antulay (supra), referred to above, was later relied upon by the Supreme Court in the case of Harshad S. Mehta vs. State of Maharashtra, 2001 (8) SCC 257. The issue in the case of Harshad S. Mehta (supra) was whether the Special Court constituted under the "Trial of Offences Relating to Transactions in Securities) Act, 1992 had the power to grant pardon under sections 306 to 308 of the Cr.P.C. The principal argument of the learned counsel appearing for the appellant-Harshad S. Mehta in the said case Page 31 of 42 R/SCR.A/212/2018 JUDGMENT was that the power to grant pardon is not an inherent power of a criminal court and is a substantive power to be specifically conferred. The contention was that sections 306 and 307 had not been extended to the Special Court under the Act. The question before the Supreme Court was whether the same was excluded by necessary implication. While negativing the contention canvassed on behalf of the appellant, the Supreme Court held as under;
"The Code has been incorporated in the Act by application of the doctrine of legislation by incorporation. The power to grant pardon has not been denied expressly or by necessary implication. As earlier stated after decision in the case of A.R.Antulay, it was not necessary to make specific provision in the Act conferring power on the Special Court to grant pardon at trial or pre- trial stage. The Special Court is a court of original criminal jurisdiction and has all the powers of such a court under the Code including those of Sections 306 to 308 of the Code, the same not having been excluded specifically or otherwise."
47. In the Maharashtra Protection of Interest of Depositors (In Financial Establishments) Act, 1999, an analogous provision like 17(2) of the Gujarat Act is there. Section 13 of the Act, 1999 reads as under;
"SECTION 13: PROCEDURE AND POWERS OF DESIGNATED COURT REGARDING OFFENCES (1) The designated Court may take cognizance of the offence without the accused being committed to it for trial and, in trying the accused person, shall follow the procedure prescribed in the Code of Criminal Procedure, 1973 (2 of 1974), for the trial of warrant cases by Magistrates.
(2) The provisions of the Code of Criminal Procedure, 1973 (2 of 1974), shall so far as may be, apply to the proceedings before a Designated Court and for the Page 32 of 42 R/SCR.A/212/2018 JUDGMENT purposes of the said provisions a Designated Court shall be deemed to be a Magistrate."
48. Section 19 of the Maharashtra Act, 1999 is almost analogous to section 17 of the Gujarat Act with the only difference that in the Maharashtra Act, the words "except section 438" are absent. In the Gujarat Act, 2003 there is a specific exclusion of the power of the Designated Court of the power under section 438 of the Cr.P.C to grant anticipatory bail. To put it in other words, the court of the original jurisdiction has been specifically denied the power to grant anticipatory bail to an accused under section 438 of the Cr.P.CF. Such specific denial or exclusion is not to be seen in the Maharashtra Act, 1999. I could also lay my hands on the "The Puducherry Protection of Interests of Depositors in Financial Establishments Act, 2004. I may refer to section 17 of the Puducherry Act, 2004 which provides for the procedure and powers of the Designated Court regarding the offences. Section 17 is extracted hereunder;
"17(1) The Designated Court may take cognizance of the offence without the accused being committed to it for trial, and, in trying the accused person, shall follow the procedure prescribed in the Code of Criminal Procedure, 1973 (Central Act 2 of 1974) for the trial of sessions cases.
(2) Except the provisions of section 467, all the provisions of the Code of Criminal Procedure , 1973 (Central Act 2 of 1974), shall, so far as may be, apply to the proceedings before a Designated Court and for the purpose of the said provision a Designated Court shall be deemed to be a Magistrate."
49. It appears that later the Act came to be amended. By the Page 33 of 42 R/SCR.A/212/2018 JUDGMENT Amendment Act, 2017, sections 3A and 3B came to be inserted. Section 3B reads as under;
"3B Anticipatory bail not to be granted:- Notwithstanding anything contained in section 438 of the Code of Criminal Procedure, 1973 (Act No.2 of 1974), no Court shall grant anticipatory bail to any person under this Act."
50. Thus, section 3B of the Amendment Act, 2017, referred to above, makes it abundantly clear that no Court shall grant anticipatory bail to any person under the Puducherry Act, 2004. There is an absolute bar even for the High Court to exercise its power under section 438 of the Cr.P.C so far as the grant of anticipatory bail is concerned.
51. I tried to look into the matter from a different angle too. Having taken the view that the Designated Court, under the Act, 2003, being a Court of the original criminal jurisdiction, has been denied specifically the power under section 438 of the Cr.P.C. to grant anticipatory bail, whether there is any scope to read into section 17 of the Act, 2003, a unique combination of sessions judge and a magistrate. Section 9 of the Act, 2003 provides for constitution of a Designated Court. However, section 9 provides that the Designated Court should be of the level of the Court of a District and Sessions Judge. Whether this, by itself, will make the Designated Court, a Court of Sessions?. Section 17(2) of the Act, 2003 provides for a deeming fiction. Section 17(2) clarifies that the provisions of the Cr.P.C., 1973 except section 438 thereof shall, so far as may be, apply to the proceedings before a Designated Court and for the purpose of the said provisions, a Designated Court Page 34 of 42 R/SCR.A/212/2018 JUDGMENT shall be deemed to be a Magistrate. By adding a deeming provision a legal fiction has been created under sub-section (2) of section 17 of the Act, 2003, by which, the Designated Judge has to be treated as a Magistrate. The Expression "shall be deemed" is, generally, used in the statues when the legislature wants to confer a status or an attribute to a person or thing which is not intrinsically possessed by that person or thing, on whom, the conferment is made. It is well settled that whatever an Act requires to be deemed or taken as true of any person or thing must in law be considered as having been duly adjudged or established concerning such person or thing and have force and effect accordingly. In order to correctly interpret a provision creating a legal fiction, the Court has to ascertain for what purpose the fiction is created and after ascertaining this, it has to assume all those facts and consequences which are inevitable for giving effect to the fiction.
52. In the aforesaid context, I looked into the provisions of the Prevention of Corruption Act, 1988. Section 5 of the Act, 1988 prescribes the procedure and powers of the Special Judge. Section 5 reads as under;
"5. Procedure and powers of special Judge.--
(1) A special Judge may take cognizance of offences without the accused being committed to him for trial and, in trying the accused persons, shall follow the procedure prescribed by the Code of Criminal Procedure, 1973 (2 of 1974), for the trial of warrant cases by the Magistrates.
(2) A special Judge may, with a view to obtaining the evidence of any person supposed to have been directly Page 35 of 42 R/SCR.A/212/2018 JUDGMENT or indirectly concerned in, or privy to, an offence, tender a pardon to such person on condition of his making a full and true disclosure of the whole circumstances within his knowledge relating to the offence and to every other person concerned, whether as principal or abettor, in the commission thereof and any pardon so tendered shall, for the purposes of sub-sections (1) to (5) of section 308 of the Code of Criminal Procedure, 1973 (2 of 1974), be deemed to have been tendered under section 307 of that Code.
(3) Save as provided in sub-section (1) or sub-section (2), the provisions of the Code of Criminal Procedure, 1973 (2 of 1974), shall, so far as they are not inconsistent with this Act, apply to the proceedings before a special Judge;
and for purposes of the said provisions, the Court of the special Judge shall be deemed to be a Court of Session and the person conducting a prosecution before a special Judge shall be deemed to be a public prosecutor.
(4) In particular and without prejudice to the generality of the provisions contained in sub-section (3), the provisions of sections 326 and 475 of the Code of Criminal Procedure, 1973 (2 of 1974), shall, so far as may be, apply to the proceedings before a special Judge and for the purposes of the said provisions, a special Judge shall be deemed to be a Magistrate.
(5) A special Judge may pass upon any person convicted by him any sentence authorised by law for the punishment of the offence of which such person is convicted.
(6) A special Judge, while trying an offence punishable under this Act, shall exercise all the powers and functions exercisable by a District Judge under the Criminal Law Amendment Ordinance, 1944 (Ord. 38 of 1944)."
53. Like section 17 of the Act, 2003, section 5 of the Act, 1988 also provides that the Special Judge may take cognizance of the offences without the accused being committed to him for trial, and in trying the accused persons, shall follow the procedure prescribed by the Cr.P.C., 1973 for the trial of warrant cases by the Magistrates. However, the important Page 36 of 42 R/SCR.A/212/2018 JUDGMENT distinguishing feature between section 17 of the Act, 2003 and section 5 of the Act, 1988 is that under section 5(3) of the Act, 1988, the Court of the Special Judge is deemed to be a Court of Session and section 5(4) of the Act, 1988 provides that so far as the provisions of section 326 and 475 of the Code are concerned, the Special Judge shall be deemed to be a Magistrate.
54. Sub-section (2) of section 3 of the P.C. Act of 1988 lays down the qualification of a Special Judge and states that a person shall not be qualified for appointment as a Special Judge under the Act unless he is or has been a Sessions Judge or an Additional Sessions Judge or an Assistant Sessions Judge under the Code of Criminal Procedure. A Special Judge is neither a Sessions Judge nor an Additional Sessions Judge nor an Assistant Sessions Judge but a person without having the said qualification cannot be appointed as a Special Judge. As noted above, under Sub-section (4) of Section 5 of the P.C. Act of 1988, a Special Judge shall be deemed to be a Magistrate for certain purposes under the Code of Criminal Procedure as specified in it. He has got exclusive power to take cognizance of offence and try the offences mentioned in Sub-section (1) of Section 3 of the P.C. Act of 1988. Thus, there is a unique combination of a Sessions Judge and a Magistrate in a Special Judge under the P.C. Act of 1988. The latter part of Sub- section (3) says that for the purpose of the said "provision", meaning thereby the Cr. P.C., the Special Judge shall be deemed to be a Court of Session. When a legal fiction has been created by a deeming clause in a section, the only possible meaning is that though in reality he may not be a Sessions Page 37 of 42 R/SCR.A/212/2018 JUDGMENT Judge, still the Act requires him to be treated as such. When the legislature wants that the Court of the Special Judge shall be deemed to be a Court of Session, there is no option but to follow the mandate of the Statute and to regard the Court of the Special Judge as a Court of Session in relation to the proceeding before him under the P.C. Act of 1988.
55. I find it difficult to read such a unique combination of a Sessions Judge and a Magistrate in a Designated Judge under the Gujarat Act, 2003. Only because the Designated Court constituted is of the level of the court of a District and Sessions Judge, will not necessarily make the Designated Court, a Sessions Court or to put it in other words, the Designated Judge as a Sessions Judge as well as as a Magistrate. For all practical purposes, the Designated Court under the Gujarat Act, 2003 remains a Court of the Original Criminal Jurisdiction and this Court of the Original Criminal Jurisdiction has been specifically denied the power to grant anticipatory bail to an accused under section 438 of the Cr.P.C.
56. I also tried to compare the provisions of the Gujarat Act, 2003 with that of the National Investigation Agency Act, 2008.
57. Sec.16 of the NIA Act deals with the procedure and powers of the Special Court. Sub-section (1) says that a Special Court may take congnizance of any offence, without the accused being committed to it for trial, upon receiving a complaint of facts that constitute such offence or upon a police report of such facts. Subsec.(2) says that when an offence triable by a Special Court is punishable with imprisonment for a Page 38 of 42 R/SCR.A/212/2018 JUDGMENT term not exceeding three years or with fine or with both, the Special Court may, notwithstanding anything contained in Subsec.(1) of Sec.260 or Sec.262 of the Code, try the offence in a summary way in accordance with the procedure prescribed in the Code and that provisions of Secs.263 to 265 of the Code shall, so far as may be, apply to such trial. Sub- section (3) says that subject to the other provisions of the NIA Act, a Special Court shall, for the purpose of trial of any offence, have all the powers of a Court of Session and shall try such offence as if it were a Court of Session so far as may be in accordance with the procedure prescribed in the Code for the trial before a Court of Session.
58. A reading of various provisions of the NIA Act shows that the Special Court constituted under the said Act is a Court of original criminal jurisdiction presided over by a person who immediately before his appointment as the Special Court was a Sessions Judge or an Additional Sessions Judge and vested with the power of the Court of Session in the matter of trial of offences investigated by the NIA. The Special Court has the status of a Court of Session though in view of Sec.16(2) of the NIA Act, the Special Court is also empowered to try certain offences summarily which power, otherwise, is exercisable only by a magistrate. If the Special Court were having the status of a Court of magistrate, it was not necessary for the Parliament to make a special provision under Sec.16(1) of the NIA Act that the Special Court can take cognizance of any offence without the accused being committed (meaning thereby that but for the said provision, committal was necessary).
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59. Thus, having regard to the provisions of the NIA Act, the Special Court under the NIA Act is a Court of the Original Criminal Jurisdiction having the status of a Court of Sessions and it can exercise all the powers conferred on a Court of Magistrate and Court of Sessions save and except those powers if any specifically denied to it and not being hide bound by the terminological status or description of the Magistrate or the Court of Session.
60. Mr. Rao, the learned counsel appearing for the applicants submitted that if the intention of the State legislature was to exclude the power of the Designated Court to grant anticipatory bail then in the Act itself it could have been specifically provided with a non-obstante clause. According to Mr. Rao, there is no reason for this Court to read such specific exclusion of power under section 17(2) of the Act, 2003. To put it in other words, Mr. Rao tried to persuade the Court that to seek anticipatory bail is an important right conferred on a accused charged with a non-bailable offence. The Court should be slow in reading such exclusion of power to grant anticipatory bail unless very specifically provided in the Act.
61. It is not as if a person accused or suspected of commission of a non bailable offence has the absolute right to get an order of anticipatory bail. He has a statutory right to apply, but the power to grant it is purely discretionary conferred under Sec.438 of the Code by the Amendment Act of 1973. There are statutes (for inst; The Scheduled Caste/Scheduled Tribe (Prevention of Atrocities) Act, 1989, the Unlawful Activities (Prevention) Act, 1967, TADA, POTA etc.) Page 40 of 42 R/SCR.A/212/2018 JUDGMENT where Secs.438 of the Code is totally made inapplicable to the offences triable by the Special courts under the said statutes. State of Madhya Pradesh Vs. Ram Kishan Balothia (AIR 1995 SC 1198) considered the constitutional vires of Sec.18 of the Scheduled Caste/Scheduled Tribe (Prevention of Atrocities) Act, 1989 excluding the application of Sec.438 of the Code. It was argued that Sec.18 of the said Act was violative of Art.21 of the Constitution of India. The Supreme Court held, referring to the decision in Kartar Singh Vs, State of Punjab (1994(2) JT (SC)
423) (which dealt with a similar provision in Sec.20(7) of the TADA) that a person accused of an offence has only a statutory right to apply for anticipatory bail introduced in the Code of 1973 in view of the 41st report of the Law Commission of India which recommended that it could be a useful advantage (to provide for anticipatory bail) though, such power is to be exercised in very exceptional circumstances. The Supreme Court pointed out that in the State of Uttar Pradesh, by Sec.9 of the Code of Criminal Procedure (UP Amendment) Act, 1976, Sec.438 of the Code has been totally omitted with effect from 28.11.1975 while the States of West Bengal and Orissa have prescribed additional limitations for the exercise of power under Sec.438 of the Code. Thus even the state legislature has the power to exclude even wholly, certain class of offences from the purview of Sec.438 of the Code.
62. Hence it was within the power of the State Legislature to specifically deny the Designated Court being the Court of the Original Criminal Jurisdiction from exercising its power under section 438 of the Cr.P.C for grant of anticipatory bail.
Page 41 of 42R/SCR.A/212/2018 JUDGMENT
63. So far as the other issues are concerned, I am not going into the merits of those as the application has not been pressed.
64. In view of the above, the Special Criminal Application No.212 of 2018 is accordingly disposed of.
65. So far as the Special Criminal Application No.1051 of 2018 is concerned, I am of the view having regard to the prayers, that the same should be looked into by the respondents in accordance with law at the earliest. The same is disposed of accordingly with a direction to the respondents to look into the matter in accordance with law.
66. So far as the Special Criminal Application No.313 of 2018 is concerned, having regard to the reliefs, prayed for, I direct the Superintendent of Police, Sabarkantha to look into the subject matter and take an appropriate decision in that regard in accordance with law.
67. With the above this writ application is also disposed of.
(J.B.PARDIWALA, J) Vahid Page 42 of 42