Karnataka High Court
Star Pvg Exports vs Srinivasa Minerals Traders Pvt Ltd on 6 June, 2019
R
IN THE HIGH COURT OF KARNATAKA
DHARWAD BENCH
DATED THIS THE 06TH DAY OF JUNE 2019
BEFORE
THE HON'BLE MR.JUSTICE B.A.PATIL
CRIMINAL APPEAL NO.2705 OF 2013
C/W
CRIMINAL APPEAL NO.2763 OF 2013
IN CRIMINAL APPEAL NO.2705 OF 2013
BETWEEN
STAR PVG EXPORTS
ANJANA PLAZA, RPD COLLEGE ROAD
TILAKWADI, BELGAUM-590006.
REPRESENTED BY ITS ACCOUNTANT AND
AUTHORIZED PERSON
SHRI MILIND S/O. GOPALRAO JOSHI,
AGE: MAJOR, OCC: ACCOUNTANT,
R/O. TILAKWADI, BELGAUM
... APPELLANT
(BY SRI.PRASHANT F GOUDAR, ADVOCATE)
AND
SRINIVASA MINERALS TRADERS PVT LTD.,
101 & 102, SWISS COMPLEX,
RACE COURCE ROAD, BANGALORE-560001,
REPRESENTED BY ITS CHAIRMAN AND
MANAGING DIRECTOR,
MR. K. GURUVAIH
AGE: MAJOR, OCC: CHAIRMAN AND MD,
R/O. 101 & 102, SWISS COMPLEX,
RACE COURSE ROAD,
BANGALORE-560001
... RESPONDENT
(BY SRI. P. M. DEVASHETTY, ADVOCATE)
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THIS CRIMINAL APPEAL IS FILED U/S 378(4) OF
CR.P.C. SEEKING TO SET ASIDE IMPUGNED ORDER DATED
01.08.2011 IN C.C.NO.1091/2007 PASSED BY THE JMFC IV-
COURT, BELGAUM, VIDE ANNEXURE-E.
IN CRIMINAL APPEAL NO.2763 OF 2013
BETWEEN
STAR PVG EXPORTS
ANJANA PLAZA, RPD COLLEGE ROAD,
TILAKWADI, BELGAUM-590006
REPRESENTED BY ITS ACCOUNTANT AND
AUTHORIZED PERSON
SHRI. MILIND S/O GOPALRAO JOSHI
AGE: 43 YEARS, OCC: ACCOUNTANT,
R/O.TILAKWADI, BELGAUM.
... APPELLANT
(BY SRI. PRASHANT F GOWDAR, ADVOCATE)
AND
SRINIVASA MINERALS & TRADERS PVT. LTD.,
101 AND 102, SWISS COMPLEX,
RACE COURCE ROAD, BANGALORE-560001
R/BY ITS CHARIMAN AND MANAGING DIRECTOR,
MR. K. GURUVAIH,
AGE: MAJOR, OCC: CHAIRMAN AND MD,
R/O. 101 AND 102, SWISS COMPLEX,
RACE COURCE ROAD, BANGALORE-560001.
... RESPONDENT
(BY SRI. P. M. DEVASHETTY, ADVOCATE)
THIS CRIMINAL APPEAL IS FILED U/S 378 (4) OF
CR.P.C. SEEKING TO SET ASIDE THE IMPUGNED ORDER
DATED 01.08.2011 IN C.C.NO.1092/2007 PASSED BY THE
JMFC IV-COURT, BELGAUM, VIDE ANNEXURE-F.
THESE CRIMINAL APPEALS COMING ON FOR
ADMISSION, THIS DAY, THE COURT DELIVERED THE
FOLLOWING:
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JUDGMENT
Both appeals have been filed by the complainant- appellant challenging the orders dated 01.08.2011 passed by the JMFC-IV Court, Belgaum in C.C.No.1091/2007 and 1092/2007 for having acquitted the accused by dismissing the complaint.
2. I have heard the learned counsel for the appellant in both matters. Learned counsel for the respondent has remained absent and there is no representation on behalf of the respondent.
3. In both cases, the question of law involved is one and the same, and in order to avoid repetition of facts, both appeals are clubbed together and disposed off by this common judgment.
4. The gist of the complaint in C. C. No. 1091/2007 is that the accused entered into an agreement for supply of iron ore material to the complainant and complainant advanced a sum of Rs.
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2,00,00,000/- (Rupees Two crores) on 28.07.2006 and 30.07.2006. Because of some technical difficulties in supplying the material, there was default and the accused agreed to refund the advance amount with compensation to the complainant. In that context, accused issued two cheques bearing Nos.287946 and 287945, dated 30.11.2006 for sum of Rs.2,00,00,000/-
(Rupees Two crores) and Rs.3,00,00,000/-(Rupees Three crores) respectively, for discharging the outstanding debt, but when the said cheques were presented for encashment, they were dishonored for the reason "in sufficient funds". Thereafter, a notice came to be issued to the accused to pay the amount, but he did not pay the same and as such, a complaint came to be filed by the complainant against the accused for the offence punishable under Section 138 of the Negotiable Instruments Act (hereinafter referred to as "N.I. Act" for short).
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5. The facts in C.C.No.1092/2007 are similar and therein also the accused issued two cheques bearing No.213069 and 213070, dated 28.07.2006 and 30.07.2006, for Rs.1,00,00,000/- (Rupees One crore) each, drawn on HDFC Bank, Belagavi in favour of the complainant and when they were presented for encashment, they were also dishonored. Thereafter, a notice came to be issued to the accused but he did not pay the amount and as such he became a defaulter and in this regard, a complaint was registered for the offence punishable under section 138 of N.I. Act.
6. Records in both cases show that the Court below took the cognizance of the offence and issued summons by its order dated 30.07.2007. Later, accused appeared before the Court below and was released on bail. On 29.10.2007, plea of the accused was recorded and case was posted for evidence of the complainant on 03.12.2007 and on that date the complainant filed an : 6:
affidavit in the form of evidence and the case was posted for cross-examination of the complainant.
7. When fact being so, the accused approached this Court under Section 482 of Cr.P.C. to quash the proceedings in Crl.P.No.4628/2007 and he urged many contentions. This Court by order dated 20.04.2009 observed that the respondent has not filed the list of witnesses and it is open for the petitioner-accused to approach the trial Court for discharge in accordance with law and he approached the trial Court by filing an application on 24.06.2009 for discharge, which was also disposed off. Subsequently on 05.03.2011, he filed an application under Section 204(2) of Cr.P.C. and thereafter the complainant filed the objection and after hearing the complainant and applicant, the impugned orders dated 01.08.2011 came to be passed. The application was allowed and the complaint came to be dismissed and the accused was acquitted. Being : 7:
aggrieved by the same, the complainant is before this Court.
8. It is the submission of the learned counsel for the appellant that the provisions of Section 204 of Cr.P.C. does not contemplate that if list of witnesses has not been produced along with complaint, the same has to be dismissed. It is his further submission that the issuance of summons after taking the cognizance only ensures the presence of the accused before the Court and even if the list of witnesses has not been filed, the accused still has an adequate opportunity of dealing with the case. He further submitted that the non-filing of the list of witnesses is not fatal to the case and the Court below ought not to have dismissed the complaint.
He further submitted that already the accused has appeared and plea has been recorded and the evidence of the complainant has also been recorded in the form of an affidavit and thereafter the Court below again relegated its proceedings to Section 203 of Cr.P.C.
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Already the said stage is over and the only remedy available to the Court is to go to the next stage by conducting the proceedings in accordance with law. The accused has to participate in further proceedings without there being any other procedures.
9. It is his further submission that once the cognizance is taken and the case is posted for evidence, then under such circumstances, the case has to be heard and decided on merits. Though, many directions have been issued by the Court, laying down that the procedures have to be followed under Section 138 of the N.I. Act, the learned Magistrate without following the said procedures, erroneously has come to the wrong conclusion and by interpreting the provisions of Section 204 of Cr.P.C. has wrongly dismissed the complaint.
On these grounds he prays to allow the appeals and set aside the impugned orders.
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10. In order to substantiate his said contentions, he relied upon the decision in the case of YAMANAPPA S.H. & ORS. V/S KALLAPPA S.G. & ORS., ILR 2003 KAR 4875. This case is conducted by relying upon the decision in the case of SUBRAMANIUM SETHURAMAN V/S STATE OF MAHARASHTRA AND ANOTHER, (2004) 13 SUPREME COURT CASES 324; in the case of IRIS COMPUTERS LIMITED V/S ASKARI INFORTECH PRIVATE LIMITED AND OTHERS, (2015) 14 SUPREME COURT CASES 399; in the case of DEVENDRA KISHANLAL DAGALIA V/S DWARKESH DIAMONDS PRIVATE LIMITED AND OTHERS, (2014) 2 SUPREME COURT CASES 246 and in the case of SUNIL VASSUDEV PEDNEKAR V/S BICHOLIM URBAN CO-OPERATIVE BANK LTD., 2006 CRL.L.J.3114.
11. I have carefully and cautiously gone through the submissions of the learned counsel appearing for the appellant and I have also given my anxious consideration to the decisions cited by him.
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12. The first and foremost contention urged by the learned counsel for the appellant-complainant is that merely because the complainant has not complied with the mandatory requirements as contemplated under Section 204 of Cr.P.C., the complaint cannot be dismissed. For the purpose of brevity, I re-produce Section 204 of Cr.P.C. which reads as under:
204. Issue of process.-(1) If in the opinion of a Magistrate taking cognizance of an offence there is sufficient ground for proceeding, and the case appears to be-
(a) a summons case, he shall issue his summons for the attendance of the accused; or
(b) a warrant- case, he may issue a warrant, or, if he thinks fit, a summons, for causing the accused to be brought or to appear at a certain time before such Magistrate or (if he has no jurisdiction himself) some other Magistrate having jurisdiction.
(2) No summons or warrant shall be issued against the accused under sub- section (1) until a list of the prosecution witnesses has been filed.
(3) In a proceeding instituted upon a complaint made in writing, every summons or warrant issued under sub- section (1) shall be accompanied by a copy of such complaint.
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(4) When by any law for the time being in force any process- fees or other fees are payable, no process shall be issued until the fees are paid and, if such fees are not paid within a reasonable time, the Magistrate may dismiss the complaint. (5) Nothing in this section shall be deemed to affect the provisions of section 87.
13. As could be seen from the said section, no summons or warrant shall be issued until the list of witnesses has been filed. On plain reading of the said section, it enumerates that it is either compulsory or rather mandatory that the complaint which is presented without the list of witnesses, the Court ought not to have issued the summons or a warrant. But in the decision of FAKIRAPPA V/S SHIDDALINGAPPA AND ANOTHER, ILR 2002 KAR 181, therein a similar issue came up before the Court and the said section has been interpreted and clarified that the filing of the list of witnesses is essential under Section 138 of the N.I. Act. The only witness will be the complainant and it is equally necessary for the complainant to file a memo : 12 :
stating that the complainant is the only witness and there are no other witnesses.
14. In a private complaint unlike the case instituted on the Police report, the accused does not have the benefit of the statements of witnesses and they precisely know what is the evidence which is going to be led by the complainant. But in the case of the private complaint under Section 138 of the N.I.Act, if there is any breach of the provisions, the same can be rectified under Chapter XXXV of Cr.P.C. This has also been reiterated by the Division Bench of this Court in the case of YAMANAPPA S.H. & OTHERS quoted supra. At paragraph Nos.2 and 3, it is observed as under:
2. It is essentially, in this background that we are required to reconcile the legal position or rather, to lay down very clearly as to what the correct course of action would be. In the first instance, the learned Advocates who have advanced their submissions before us are right when they point out that under the provisions of Section 204(2) the filing of the list of witnesses : 13 :
is essential and in one of the decisions referred to above the learned Judge has even clarified the position that the case being one under Section 138 of the Negotiable Instruments Act and where the only witness is the complainant, that it is equally necessary for the complainant to file a memo stating that the complainant is the only witness and that there are no other witnesses.
There can be no two opinion about the fact that even though in a private complaint unlike in a case instituted on a police charge sheet, the accused does not have the benefit of the witness statements, in other words, knowing precisely as to what is the evidence that is going to be used against the accused, but at the same time, the law makes it obligatory for the complainant to atleast disclose the names of the witnesses so that the accused in relation to the contents or averments in the complaint will be able to correlate as to what precisely is the role of these witnesses and gauge as to what is the nature of the evidence that will have to be dealt with. We do agree that there are instances wherein the breach of a mandatory provision would affect the very basis of the proceeding and that consequently, where an application for quashing is made before the High Court that inevitably the proceeding will have to be quashed. There are instances such as those set out in Chapter 35 of the Cr.P.C. wherein the breaches are rectifiable.
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This has obviously been provided for in order to ensure that there is no wastage of judicial time and furthermore, that the complainant is not put to avoidable wastage of time and resources by having to reinstitute the proceeding if it can be corrected and saved. The entire debate has emanated because Sections 460 and 461 Cr.P.C. setout a number of situations which vitiate and do not vitiate a proceeding but the present state of affairs does not figure there. That is why the issue is required to be independently decidable.
3. We have already dealt with the intended or possible prejudice aspect to the accused which is the genesis for making it compulsory to disclose the list of witnesses. Normally, where there is compliance with the provisions of Section 204-2, the accused will receive the copy of the complaint along with the summons or warrant and therefore be fully posted of the case made out and the witnesses who are going to depose in favour of the prosecution. The short question that we need to examine is as to whether any prejudice is caused to the accused at this point of time if the list of witnesses is not disclosed and in our considered view, the answer to that question is in the negative for the simple reason that process only enforces the presence of the accused before the Court and accused still has an adequate opportunity of dealing with the case : 15 :
because the complainant's evidence is yet to be led and, well before that stage the list of witnesses is bound to be disclosed as soon as the error comes to the notice of the Court. Consequently, in our considered view, there is no justification for the plea that the non-filing of the list of witnesses will render the proceeding ab initio void or that this infirmity would ipso facto justify an order for quashing of the proceedings. We accept the position that the error is rectifiable as is essentially the view that has been enunciated in the majority of decisions.
15. On close reading of the above said paragraphs, it clearly goes to show that only because, the list of witnesses has not been filed following with the complaint, the complaint cannot be dismissed as the accused still is having an adequate opportunity of dealing with the case after leading of the evidence of the complainant.
16. Taking into consideration the above said proposition of law, I am of the considered opinion that the Court below only because the list of witnesses has not been filed along with the complaint, passed the : 16 :
impugned orders, which appears to be erroneous and not sustainable in law and the same are liable to be set aside.
17. Be that as it may, even records disclose that the accused-respondent on summons appeared before the Court on 09.10.2007 and he is released on bail and subsequently on 29.10.2007, the accused was present and plea has been recorded. Thereafter, the case was posted for evidence and on 3.12.2007 evidence of the complainant was recorded in the form of affidavit and thereafter case was posted for cross examination of PW-1 that itself clearly goes to show that the Court has ignored the said facts and has dismissed the complaint.
18. It is well settled proposition of law that once a plea is recorded in a summons case, it is not open either to the accused to seek discharge and even the contention cannot be accepted. It is further observed that if at all the accused is aggrieved, the only remedy : 17 :
available to him is to challenge under Section 482 of Cr.P.C. Though in the instant case, accused has approached this Court under Section 482 of Cr.P.C. in Crl.P. No.4628/2007, the Court has dismissed the said petition and has observed that if at all the accused is entitled to, he can file an application for discharge in accordance with law. But, that observation itself is also not happily worded and used. In a summons case, no such application for discharge can be filed. When once the plea of the accused is recorded, the procedure contemplated under Chapter XX has to be followed and no other alternative has to be accepted in this behalf. For the said proposition of Law, I want to rely upon the decision in the case of SUBRAMANIUM SETHURAMAN V/S STATE OF MAHARASHTRA AND ANOTHER quoted supra, wherein at paragraph Nos.16 and 17, it has been observed as under:
16. The next challenge of the learned counsel for the appellant made to the finding of the High : 18 :
Court that once a plea is recorded in a summons case it is not open to the accused person to seek a discharge cannot also be accepted. The case involving a summons case is covered by Chapter XX of the Code which does not contemplates a stage of discharge like Section 239 which provides for a discharge in a warrant case. Therefore, in our opinion the High Court was correct in coming to the conclusion that once the plea of the accused is recorded under Section 252 of the Code the procedure contemplated under Chapter XX has to be followed which is to take the trial to its logical conclusion.
17. As observed by us in Adalat Prasad case the only remedy available to an aggrieved accused to challenge an order in an interlocutory stage is the extraordinary remedy under Section 482 of the Code and not by way of an application to recall the summons or to seek discharge which is not contemplated in the trial of a summons case.
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19. It is well established proposition of law that the learned Magistrate is not justified by relegating himself again to the provisions of Section 203 and 204 of Cr.P.C. When once the plea has been recorded and affidavit in the form of evidence has been recorded, then, under such circumstances, the Court cannot recall the order of issue of summons and further proceedings, as the Court becomes functus officio insofar as the said procedure is concerned. It is the duty of the Court only to proceed to the next stage enabling the accused to participate in the proceedings and to dispose off the case in accordance with law. If the said procedure is not followed, that itself appears to be erroneous and such orders cannot be encouraged and the same are liable to be set aside.
20. This proposition of law is also relied upon by the Hon'ble Apex Court in the case of IRIS COMPUTERS LIMITED V/S ASKARI INFORTECH PRIVATE LIMITED : 20 :
AND OTHERS quoted supra, wherein at paragraph Nos.8,9,10, it has been observed as under:
8. The point that would fall for our consideration and decision is, whether the learned Magistrate was justified in recalling the order passed by him issuing summons to the Respondents upon an application made by them under Section 202, 203 and 245 of the Code.
9. This Court has dealt with the question of recall of a process issued under Section 204 of the Code in Adalat Prasad case and opined that the Code does not contemplate or provide for any provisions affording opportunity to the accused until the issuance of process to him under Section
204. This Court has observed that before issuing summons under Section 204 of the Code the Magistrate must be satisfied that there exists sufficient ground for proceeding with the complaint and a prima-facie case is made out against the accused. The said satisfaction should be arrived at by conducting an inquiry as contemplated under Sections 200 and 202 of the Code. The first stage of dismissal of the complaint before the issuance of process arises under Section 203 of the Code, at which stage the accused has no role to play. Subsequent to issuance of process, the question of the accused approaching the Court by making an application : 21 :
under Section 203 of the Code for dismissal of the complaint is impermissible because by then the stage of Section 203 is already over and the Magistrate has proceeded further to Section 204 stage.
10. Therefore, the crux of the matter rests into the existence of two different scenarios; the former involving only the complainant's role and the latter introducing the accused. The former constitutes cognizance of the offence on complaint, satisfaction reached by the Magistrate that a prima-facie case is made out and thereafter, issuance of process to the accused. It is only after the aforesaid stages are complete;
the next stage is triggered enabling the accused to actively participate in the proceedings. The dismissal of complaint by the Magistrate under Section 203 evidently falls into the former stages of proceedings when the Magistrate has to base his opinion as to the existence of sufficient ground for proceeding towards the second stage on the statements of the complainant and the witness's along with the result of the inquiry conducted under Section 202. It is for obvious reasons that none of the former stages in the Code provide for hearing the summoned accused, the said being only preliminary stages and the stage of hearing of the accused arising at subsequent stages provided for in the latter : 22 :
provisions in the Code. [See: Bholu Ram v. State of Punjab].
21. Even the Hon'ble Apex Court in the case of INDIAN BANK ASSOCIATION AND OTHERS V/S UNION OF INDIA AND OTHERS, (2014) 5 SUPREME COURT CASES 590, at paragraph No.23 has given a direction as to what is the procedure to be followed in a case under Section 138 of N.I. Act. For the purpose of brevity, I quote paragraph Nos.23(1) to (5), which read as under:
23. Many of the directions given by the various High Courts, in our view, are worthy of emulation by the Criminal Courts all over the country dealing with cases Under Section 138 of the Negotiable Instruments Act, for which the following directions are being given:
23(1) Metropolitan Magistrate/Judicial Magistrate (MM/JM), on the day when the complaint Under Section 138 of the Act is presented, shall scrutinize the complaint and, if the complaint is accompanied by the affidavit, and the affidavit and the documents, if any, are found to be in order, take cognizance and direct issuance of summons.
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23(2) MM/JM should adopt a pragmatic and realistic approach while issuing summons. Summons must be properly addressed and sent by post as well as by e-mail address got from the complainant. The Court, in appropriate cases, may take the assistance of the police or the nearby Court to serve notice to the accused. For notice of appearance, a short date be fixed. If the summons is received back un-served, immediate follow-up action be taken.
23(3) The Court may indicate in the summons that if the accused makes an application for compounding of offences at the first hearing of the case and, if such an application is made, the Court may pass appropriate orders at the earliest.
23(4) The Court should direct the accused, when he appears to furnish a bail bond, to ensure his appearance during trial and ask him to take notice Under Section 251 Code of Criminal Procedure to enable him to enter his plea of defence and fix the case for defence evidence, unless an application is made by the accused Under Section 145(2) for re-calling a witness for cross-examination.
23(5) The Court concerned must ensure that examination-in-chief, cross-examination and reexamination of the complainant must be : 24 :
conducted within three months of assigning the case. The Court has option of accepting affidavits of the witnesses, instead of examining them in the Court. Witnesses to the complaint and accused must be available for cross-examination as and when there is direction to this effect by the Court.
22. Keeping in view the above said facts and circumstances, I am of the considered opinion that the learned Magistrate without following the procedure laid down by law has erroneously passed the impugned orders. Though under section 204(2) of Cr.P.C. the list of witnesses has to be filed along with the complaint, when the complaint is filed under Section 138 of the N.I. Act, it stands on a different footing. The complainant himself may be the only witness in case of the complaint filed under Section 138 of the N.I. Act and he may rely upon only on his own evidence and the evidence of the accused is the defence.
23. It is not obligatory on the part of the complainant to affix a list stating that he does not : 25 :
propose to examine any witness. The only thing is that he can file the same in the form of memo itself. Looking from any angle, the trial Court without keeping in view the said proposition of law, has gone relegating to the stage of taking of cognizance and has erroneously dismissed the complaint and acquitted the accused.
24. In the light of the discussion held by me above, appellant has made out a case to allow the appeals.
Accordingly, appeals are allowed. The impugned orders dated 01.08.2011 in CC NO.1091/2007 vide Annexure-'E' and in C.C. NO.1092/2007 vide Annexure-'F' passed by the JMFC IV-Court, Belgaum are liable to be set aside and accordingly they are set aside.
This is a matter which is pending since 2001 and the records also indicate the fact that on one or the other pretext, the case has been dragged on for a long : 26 :
period. In that light, the trial Court is directed to proceed from the stage where the affidavit of the complainant has been filed and after cross examination of the complainant, the further proceedings may be held and because of the long pendency, the trial Court is directed to decide the case expeditiously with an outer limit of six months from the receipt of a copy of this order.
Sd/-
JUDGE Yan/Hmb