Orissa High Court
Diego Graffi vs State Of Odisha And Another .... ... on 1 December, 2021
Author: Sashikanta Mishra
Bench: Sashikanta Mishra
IN THE HIGH COURT OF ORISSA AT CUTTACK
CRLMC No.364 of 2021
Diego Graffi .... Petitioner
Mr. S.C.Pradhan
Advocate
-versus-
State of Odisha and another .... Opposite Parties
Mr.P.K.Maharaj,
Addl. Standing Counsel
Mr.S.Mishra (For O.P.No.2)
CORAM:
JUSTICE SASHIKANTA MISHRA
ORDER
01.12.2021.
Order No.
12. 1. This matter is taken up through hybrid mode.
2. In the present application filed under Section 482 of Cr.P.C., the Petitioner seeks to challenge the order dated 12th February, 2020 passed by the learned S.D.J.M.(S), Cuttack in Complaint Case No.772/2019 in taking cognizance of the offences under Sections 417 and 418 of I.P.C.
3. The brief facts of the case are that the Petitioner is the Chief Executive Officer and Managing Director of M/s.Piaggio Vehicles Private Ltd., a Company incorporated under the Page 1 of 7 Indian Companies Act, 1956 having its Office at Pune in the State of Maharashtra. A complaint was filed by the present Opposite Party No.2 on 13th December, 2019 in the court of learned S.D.J.M. (S), Cuttack against the present Petitioner and M/s. Sakambari Automobiles. It was alleged that the complainant-Opposite Party No.2 had purchased a Vespa Scooter from Accused No.1-Sakambari Automobiles upon payment of Rs.1,10,000/- on 17th February, 2019. On 21st February, 2019 the complainant brought the Scooter to the Show Room of Sakambari Automobiles as the Scooter was emitting certain sounds. He was advised to leave his vehicle for necessary repair and on 24th February, 2019 the vehicle was handed over to him after proper verification of the mechanical experts.It is alleged that the mechanic of Sakambari Automobiles admitted that the Scooter had manufacturing defect, which was beyond repair for which the complainant demanded a new Scooter in exchange from the seller, but it was refused. The complainant, therefore, left the Scooter in the Show Room and informed the matter to the higher authorities, but to no avail. On such facts, it was claimed that the accused persons having sold the Scooter with manufacturing defect have thereby committed the offence of cheating and wrongful loss to him.
4. Upon receipt of such complaint the initial statement of the complainant was recorded and enquiry under Section 202 of Cr.P.C. was taken up in course of which one witness was also Page 2 of 7 examined. Thereafter, on 12th February, 2020 the learned S.D.J.M. was prima facie satisfied that a case under Section 417 and 418 of I.P.C. is well made out and, therefore, took cognizance for the said offence and also held that there is sufficient material to proceed against the accused persons, and therefore, directed issuance of process against the accused persons. The said order is impugned in the present application.
5. Heard Mr. S.C.Pradhan, learned counsel for the Petitioner, and Mr. Sidhartha Mishra, learned counsel for the complainant- Opposite Party No.2 and Mr.P.K. Maharaj, learned Addl. Standing Counsel for the State.
6. It is forcefully argued by Mr. Pradhan that the complainant's grievance, if any, is entirely directed against the other accused namely, M/s. Sakambari Automobiles and not against the present Petitioner. It is further submitted that the relationship between the Company of whom the Petitioner is the CEO and Managing Director and the dealer, M/s. Sakambari Automobiles is that of 'Principal and Principal' and not 'Principal and Agent' as has been sought to be made out by the Company. Therefore, the Petitioner cannot be held vicariously liable for any act of commission or omission on the part of said M/s. Sakambari Automobiles as it stands on an independent footing in so far as the complainant's grievance is concerned. It is further argued that even otherwise the so called grievance of the complainant cannot be entertained within the Page 3 of 7 purview of a criminal proceeding and in fact, the complainant has himself approached the District Consumer Disputes Redressal Forum in C.C. No.158/2019 on the self same cause of action. Mr. Pradhan has cited a decision of the Hon'ble Supreme Court of India in the case of Ravindranatha Bajpe v. Mangalore Special Economic Zone Ltd. and others in Criminal Appeal Nos.1047 and 1048 of 2021. It is further argued by Mr. Pradhan that if the dealer agreement enclosed as Annexure-3 series between M/s.Piaggio Vehicles Private Ltd. and M/s.Sakambari Automobiles is carefully examined, it would show that the relationship between the two is that of Principal and Principal inasmuch as the latter does not sell the Scooter as an Agent of the former but first purchases the Scooters after paying the price thereof and thereafter, sells them independently. So, it cannot be a case of Principal and Agent as is being attempted to be interpreted by the complainant.
7. Per contra, Mr. Sidhartha Mishra, learned counsel for Opposite Party No.2, argued that the allegation of the complainant does not relate to any after sales service relating to the Scooter, but entirely to the manufacturing defect found therein. Since the Company is the manufacturer, it cannot wriggle out of its liability to make good the loss sustained by the complainant. Moreover, by manufacturing a Scooter with defects, the Petitioner must also be held to have committed the offences of cheating and causing wrongful loss to the company.
Page 4 of 78. As it appears, the basic dispute between the parties is that the complainant claims that the Scooter in question had some manufacturing defect which the seller (M/s. Sakambari Automobiles) could not remove. The question is, whether on such facts alone the Petitioner can be roped into the criminal proceeding as an accused. A perusal of the complaint petition does not reveal any direct allegation against the Petitioner, but as fairly submitted by Mr. Mishra, the Petitioner is attempted to be brought into the picture on the principle of vicarious liability. As was observed by the Hon'ble Supreme Court in the case of Sunil Bharti Mittal v. Central Bureu of Investigation; (2015) 4 SCC 609, it is the cardinal principle of criminal jurisprudence there is no vicarious liability unless the statutes specifically provides so and individuals who have perpetuated the commission of an offence on behalf of a company can be made an accused, along with the company, if there is sufficient evidence of his active role coupled with criminal intent. Second situation in which he can be implicated, is those cases where the statutory regime itself attracts the doctrine of vicarious liability, by specifically incorporating such a provision. After observing thus, the Hon'ble Supreme Court referred to an example, i.e. Section 141 of the Negotiable Instruments Act. Further, in the case of Maksud Saiyed v. State of Gujarat; (2008) 5 SCC 668, it was observed that the Penal Code does not contain any provision for attaching vicarious liability on the part of the Managing Director or the Directors of the Company when the accused is the company.
Page 5 of 7Thus, arraigning the Petitioner as an accused in the complaint only because he happens to be the Chief Executive Officer and M.D. of the Company cannot be sustained in the eye of law. It is also well settled that summoning of an accused in a criminal case, is a serious matter and that criminal law cannot be set into motion as a matter of course. The above view was taken by the Hon'ble Supreme Court in the case of Pepsi Foods Ltd. v. Special Judicial Magistrate; (1998) 5 SCC 749.
9. Coming to the facts of the present case, as has already been discussed, the complaint petition does not reveal any direct allegation relating to the offence under Sections 417/418 of the I.P.C. against the present Petitioner. The initial statement of the complainant and the statement of one Jagannath Bhuyan examined in course of the enquiry under Section 202 of Cr.P.C. also does not reveal anything against the present Petitioner save and except the bald statement that the brother of the complainant had sent e-mail correspondence to the Show Room as well as the company, but nothing was done. In the considered opinion of this Court, this is not sufficient to fasten any criminal liability on the Petitioner. Learned S.D.J.M. does not appear to have considered the matter in the above perspective, rather the matter was dealt with mechanically. It is reiterated that before setting the criminal law into motion and summoning an accused, it is imperative for the Magistrate to delve deep into the materials placed before him to see if, in fact, a case for summoning the accused is made out or not.
Page 6 of 7Only because the complainant has arraigned a person as an accused does not mean that the court shall automatically issue process against him. It is for such purpose that the enquiry under Section 202 of Cr.P.C. has been envisaged in the statute. Though the learned S.D.J.M. allowed to conduct such enquiry, yet there appears to have been singular lack of application for judicial mind to the facts ascertained in such enquiry as a result of which, the whole exercise was rendered an empty formality vis-à-vis the present Petitioner and process was issued as a matter of course without ascertaining if, prima facie, any case is made out against him.
10. For the forgoing reasons, therefore, this Court has no hesitation in holding that the impugned order in so far as it relates to issuing process against the present Petitioner warrants interference and is, therefore, quashed to such extent.
11. The CRLMC is, accordingly, disposed of.
Urgent certified copy of this order be granted on proper application.
(Sashikanta Mishra) Judge A.K.Behera Page 7 of 7 Page 8 of 7