N. C. SIPPY v. PREM KUMAR — 1986 DIGILAW 145 (DEL)

J. D. JAIN, J. ( 1 ) THIS "petition under Section 482, Code of Criminal Procedure (hereinafter referred to as the Code ) is directed against order dated 12th September 1984 of a Metropolitan Magistrate summoning the petitioners to face trial for offence under Section 63 of the Copy Rights Act (for short the Act ) and Sections 4651467134, Indian Penal Code (for short Indian Penal Code ). ( 2 ) THE facts giving rise to this petition succinctly are that the respondent-Prem Kumar is carrying on the business of film making under the name and style of M/s. Belco Movies at Bhagirath Palace, Chandni Chowk, Delhi. The said firm is a member of the Motion Pictures Association, Delhi. On 4th September 1984 he instituted a complaint against Shri Hira Sobhachand Choithramani and ten others under Section 63 of the Act and Sections 465, 467, 468, 471 and 380, 1pc. He has averred that Shri Hira Sobhagchand Choithramani, accused No. 1, was the managing director of M/s. Esquire Video Films Service Private Limited, accused No. 2 (short the Company ), which is a company incorporated under the Companies Act. Accused Nos. 3 to II are the other directors of the company. All of them are carrying on the business of film making etc. at Bombay. The Company s ostensible business is to acquire rights to prepare tui sale video recording of the films produced by the film producers in the country. The Company has "an Esquire Presentation" as its monogram and "trimurti" as its insignia and displays the same on the video tapes in respect of which they are supposed to have acquired the rights of making, selling and distribution. ( 3 ) IT is further averred that the complainant-respondent produced a cinematograph film entitled "gorakhdhanda". It was completed in 1979 and was duly certified for "unrestricted public exhibition" by the Central Board of Film Censores, Government of India, vide Certificate issued on 14th June, 1979. The said certificate is valid upto 13th June, 1989. The trailer of the film was also certified for unrestricted public exhibition by a separate certificate dated 22nd June, 1979. Thereafter, the complainant got the film duly registered with the Motion Pictures Association on 6th October, 1979. The said certificate is valid upto 13th June, 1989. The trailer of the film was also certified for unrestricted public exhibition by a separate certificate dated 22nd June, 1979. Thereafter, the complainant got the film duly registered with the Motion Pictures Association on 6th October, 1979. In August, 1984 when the respondent was negotiating with some parties for the exhibition of the aforesaid film at Delhi, he came to know that the accused persons had prepared video tapes of the said film and had put the same for sale in the market, thereupon, he deputed his employee Rakesh to find out if it was true. The latter went to a video library in Bhagirath Palace and brought one video tape of the aforesaid film. It was displayed on VCR and was found to be a copy of his film "gorakhdhanda". The video tape bore the inscription "an Esquire Presentation" as also the insignia "trimurti". Feeling shocked over this discovery he asked his employee Rakesh to bring the original video-tape from which the said copy had been prepared. Accordingly, Rakesh brought another copy which appeared to be original copy of the aforesaid film. The complainant further alleged that he also discovered that the accused had also sold rights of display of their video tapes to M/s. Kesar Video Private Limited, a company carrying on business outside India. He asserted that the copy right in the aforesaid film exclusively belonged to him and the accused persons had committed the offence of piracy by preparing unauthorised video tapes of the same. He also alleged that all the accused persons were living and working at Bombay and they were actively participating in the day-to-day working of the company. Hence, all of them were criminally liable for the offences of infringement of his copy right and forgery etc. ( 4 ) THE respondent stepped in the witness box and deposed to the foregoing facts. He also examined Shri Charanjit Dhawan, the story writer of the picture "gorakhdhanda" and his employee Rakesh Kumar Kaira in support of his contention that he had the exclusive copy right in the picture "gorakhdhanda" and that his copy right had been infringed by the accused persons by preparing video tapes thereof unauthorisedly and clandestinely with a view to make profit out of it. ( 5 ) ON being served with the process, the petitioners N. C. Sippy and R. N. Sippy, who are father and son and are arraigned as accused Nos. 5 and 9 in the complaint, have filed this petition for quashing the complaint and the proceedings initiated against them for the aforesaid offences Their contention is that the complaint as also the evidence on record is woefully vague and does not disclose when the alleged offences were committed. It does not assign any overt act to any of them so as to render them criminally liable for the offences of infringement of sopy right and forgery etc. Further they cannot be hauled up for the said offences even vicariously in the absence of any avermentjevidence to show that they were incharge of and responsible to the company for the conduct of the business of the Company as envisaged in Section 69 of the Act. Lastly, it is contended that no offence whatsoever is made out under E Sections 465 and 467, Indian Penal Code. ( 6 ) SECTION 69 of the Act specifically deals with "offences by companies". It provides that where any offence under the Act has been committed by the company, every person who at the time the offence was committed was incharge of and was responsible to the company for the conduct of the business of the company a?, well as the company shall be deemed to be guilty of such offence and shall be liable to be proceeded against and punished accordingly. The submission made by the learned counsel for the petitioners precisely is that there is no averment in the complaint much less any evidence to the effect that the petitioners were incharge of and responsible to the Company for the conduct of the business of the company at the time the offence was committed. He has vehemently urged that there is no iota of evidence on record to show when the alleged offences were committed by the Company or for that any matter of the accused persons who were managing director and directors of the same. Further, according to him, nothing has come on record to indicate that the petitioners were directors of the Company at the time of the commission of the pffenes. Further, according to him, nothing has come on record to indicate that the petitioners were directors of the Company at the time of the commission of the pffenes. It is, therefore, a ca?e of total non-application of judical mind by the learned Magistrate before summoning the petitioners and other accused. ( 7 ) AS stated above, the respondent averred in the complaint that accused No. I was the managing director and accused Nos. 3 to II were the directors of the Company, accused No. 2. All the directors were living and working at Bombay and wereactively participating in the day-to-day working of the Company. He stepped in the witness box and reiterated that accused No. 1 was the managing director of the Company and all other directors were taking active part in the affairs of the Company. He further stated that all of them were accomplices in the commission of the offerees and they had joined hands to commit forgery and piracy of his aforesaid film by preparing video cassettes. According to the learned counsel for the petitioners, however, this evidence falls short of establishing the essential ingredients of Section 69 that they were incharge of and responsible to the Company for the conduct of the business or the Company at the time of the commission of the offences. I am unable to subscribe to this view for the simple reapon. that the law does not require the parrot like repetition of the words of the statute in the complaint and it is quite enough that the allegations contained in the complaint in essence and substance purport to satisfy the essential postulates of the statute. Hence, the fact that the petitioners were directors of the Company and that they were actively participating in the affairs of the Company would ex-facie warrant an inference that they were incharge of and responsible to the Company for its day-to-day busiess. It is their active participation in the affairs of the Company as Directors that constitutes the gravemen of the charge to hold them vicariously liable for the acts of omission and commission of the Company. ( 8 ) IN Municipal Corporation of Delhi v. Ram Kishan Rohatgi and Others, 1983 SCC (Cri.) 115 (1), which was a case under the Prevention of Food Adulteration Act. ( 8 ) IN Municipal Corporation of Delhi v. Ram Kishan Rohatgi and Others, 1983 SCC (Cri.) 115 (1), which was a case under the Prevention of Food Adulteration Act. the Food Inspector had made the following averment in the complaint: "that accused No. 3 is the Manager of accused No. 2 and accused 4 to 7 are the D iectors of ?. "culed No, 2 and as such they were incharge of and responsible for the conduct of business of accused No. 2 at the time of sampling. " dealing with the vicarious liability of the director for selling adulterated article of food. the Supreme Court observed : "reliance has been placed on the words as such in order to argue that because (sic) the complaint does not attribute any criminal responsibility to accused 4 to 7 except that they were incharge of and responsible for the conduct of the business of the Company. It is true that there is no clear averment of the fact that the Directors were really incharge of the manufacture and responsible for the conduct of business but the word; as such indicate that the complainant has merely presumed that the Directors of the Company must be guilty because they are holding a particular office. This argument found favour with the High Court which quashed the proceedings against the Directors as also against the Manager, respondent 1. . . . . . . . . . . . . . . . . . . . . . . . . In these circumstances, therefore, we find ourselves in complete agreement with the argument of the High Court that no case against the Directors (accused 4 to 7) has been made- out ex facie on the allegations made in the complaint and the proceedings against them were rightly quashed. " ( 9 ) OBVIOUSLY reliance on this authority by the learned counsel for the petitioners is totally misplaced. It is for the simple reason that in the said case the directors were sought to be made criminally liable on the assumption that because of their office they were incharge of and responsible for the conduct of the business of the company. In the instant case, on the other hand there is a specific and explicit averment that all the directors actively participate in the business of the Company. In the instant case, on the other hand there is a specific and explicit averment that all the directors actively participate in the business of the Company. So, criminal liability is not sought to be saddled merely because of their position as directors of the Company but also because of their active participation in the affairs of the Company. In this context, I may advert to another case which was decided by the Supreme Court on the same date on which Ram Kishan Rohtagi s case (supra) was decided. The said case is Municipal Corporation of Delhi v. Purshotam Dass Jhunjunwala and Others, 1983 SCC (Cri.) 123 (2 ). The relevant allegation against the accused persons as contained in para 5 of the complaint are extracted below:- "that accused Ram Kishan Bajaj is the Chairman. accused R. P. Neyatia is the Managing Director and accused 7 to 12 are the Directors of the Hindustan Sugar Mills Ltd. and were incharge of and responsible to it for the conduct of its business at the time of commission of offence. "the Supreme Court distinguished this case from the previous case as under:- "unlike the other case, para 5 of the complaint of this case gives complete details of the role played by the respondents and the extent of their liability. It is clearly mentioned that Ram Kishan Bajaj is the Chairman. . . . . . . . . . . . . . . . . and respondents 7 to II arc the Directors of the mill and were incharge of and responsible for the conduct of its business at the time of the commission of the offence whereas in the other case the complaint has merely drawn a presumption without any averment. " "in the instant case, a clear averment has been , made regarding the active role played by the respondents and the extent of their liability. In this view of the matter, it cannot be said that para 5 of the complaint is vague and does not implicate respondents I to II. As to what would be the evidence against the respondents is not a matter to be considered at this stage and would have to be proved at the trial. We have already held that for the purpose of quashing the proceedings only she allegations set forth in the complaint have to be seen and nothing further. As to what would be the evidence against the respondents is not a matter to be considered at this stage and would have to be proved at the trial. We have already held that for the purpose of quashing the proceedings only she allegations set forth in the complaint have to be seen and nothing further. " ( 10 ) ON a mere juxtaposition of these two decisions it is manifest that the ratio decided in both the cases was that there must be a clear and explicit averment regarding the active participation of the directors in the business of the company at the time of the commission of the alleged offence. The reason for the same is not far to seek. As said by D. S. Mathur, J. , in R. K. Khandelwal v. State, (1964) 62 All LJ 625 (3) : "there can be directors who merely lay down the policy and are not concerned with the day-to-day working of the Company. Consequently the mere fact that the accused person is a partner or director of the Company, shall not make him criminally liable for the offences committed by the Company unless the other ingredients are established which make him criminally liable. " ( 11 ) THIS requirement of law, to my mind, is amply satisfied at least ex-fade on the averments made by the respondent complainant in the case on hand. It would, of course, be for the complainant to adduce detailed evidence at the trial to substantiate these allegations. If eventually the learned Magistrate comes to the conclusion that no offence was made out against the petitioners it will be open to him to discharge or acquit the petitioners, as the case may be. ( 12 ) AS for the contention that the complaint as well as the evidence produce by the respondent at the pre-summons stage suffers from the vice of vagueness with regard to the time of the commission of offence and the period during which the petitioners were directors of the Company, suffice it to sav that Section 51 of the Act which defines the offence of infringement of compny right is very wide in amplitude. On its plain language it takes within its sweep not only the making for sale or hire of an artistic work in the form of cinematograph film but also selling, letting for hire or offering for sale or hire E by way of trade displays an infringing copy of !he artistic work. Further, distribution of infringing copies for the purpose of trade or to such an extent as to affect prejudicially the owner of the copy right is also made culpable thereunder. Hence, reproduction of the cinematograph film in which copy right cxists, as also sale or distribution of the infringing copy would be covered by the said Section. The Explanation to Section 2 (f) of the Act which has been added by the Amendment Act 65 of 1984 expressly states that the video films shall also be deemed to be work produced by n process analogous to cinematography. As said by Sulaiman, C. . T. . in Mary P. Marshal v. Ram Narflin I-al and another. AIR 1934 All 922 (4) "an infringement takes place not only when a book is reprinted, but also when a book in respect of which a copy right exists is sold. Therefore. there is a freshcause of action on the sale of every book ". In this view of the matter, therefore, there can be no room for doubt that even if the infringing copies, viz. the video tapes of the film "gorakhdhanda". had been prepared on the petitioners and their co-accused prior to 1984 when the Act was amended by introducing the piracy of cinematograph film as an offence bv Amendment Act 65 of 1984. the accused in this case would be still liable if it is proved that at the relevant time the infring- ing copies of the infringed work were being sold or distributed for display etc. by the accused or their agents or servants etc. In this sense of the word, an offence under Section 63 of the Act can be legitimately looked upon as a continuing offence. Needless to say that the contention of- the petitioners that they were not directors of the Company in the year 1984 cannot be looked into by this Court while exercising its inherent jurisdiction under Section 482 of the Code. It will again be a matter for determination at the trial. Needless to say that the contention of- the petitioners that they were not directors of the Company in the year 1984 cannot be looked into by this Court while exercising its inherent jurisdiction under Section 482 of the Code. It will again be a matter for determination at the trial. ( 13 ) IT is well settled by a long catena of decisions of the Supreme Court that the jurisdiction of the High Court while exercising its inherent powers under Section 482 of the Code to quash a First Information Report or a complaint is very limited. It has no jurisdiction to examine the correctness or otherwise of the allegations and it would be justified in quashing the complaint and the proceedings only if no offence, is made out on the allegations made in the complaint or documents accompanying it per se. As observed by the Supreme Court in Smt. Nagawwa v. Veeranna Shivalingappa Konialgi and others, AIR 1976 SC 1947 (5): "at the stage of issuing process the Magistrate is mainly concerned with the allegations made in the complaint or the evidence led in support of the same and he is only to be prima facie satisfied whether there are sufficient grounds for proceeding against the accused. It is not the province of the Magistrate to enter into a detailed discussion of the merit? or de-merits of the case nor can the High Court go into the matter in its revisional jurisdiction which is a very limited one. "the Supreme Court laid the following guidelines and the grounds on which an order of the Magistrate issuing process against the accused can be quashed by the High Court: " (1) where the allegations made in the co. npl. "the Supreme Court laid the following guidelines and the grounds on which an order of the Magistrate issuing process against the accused can be quashed by the High Court: " (1) where the allegations made in the co. npl. int or the statement of the witnesses recorded in support of the same taken at their face value make out absolutely no case against the accused or the complaint does not disclose the essential ingredients of an offence which is alleged against the accused; (2) where the allegations made in the complaint are- potently absurd and inherently and inherently improbable so that no prudent person can ever reach a conclusion that there is sufficient ground for proceeding against the accused; (3) where the discretion exercised by the Magistrate in issuing process is capricious and arbitrary having been based either on no evidence or on materials which are wholly irrelevant or inadmissible; and (4) where the complaint suffers from fundamental legal defects, such as, want of sanction, or absence of a complaint by legally competent authority and the like. [see also Municipal Corporation of Delhi v. Ram Kishan Rohatgi and Others (supra) and Pratibha Rani v. Suraj Kumar and Another, (1985) 2 SCC 370 :1 (6 ). ( 14 ) AS observed earlier the allegations In the instant case are clear, specific and unambiguous and prima facie constitute an offence under Section 63 of the Act. It may, however, be pertinent to add that I have had the occasion to see the video tape Ex. P2 which ex-facie shows that it would have been recorded by the Company. It bears the insignia and the monogram of the Company mentioned above. Further it carries a certificate of the Board of Censors, Government of Singapore, dated 21st December, 1982 which would prima facie indicate that the video tape of the picture in question was got certified by the Company even in a foreign country. Hence. I do not find any ground to interfere with the impugned order on this aspect of the matter. ( 15 ) THIS brings me to the offences under Sections 465 and 467 Indian Penal Code. Both these Sections provide punishment for the offence of forgery. Of course, the offence envisaged in Section 467 is graver in nature and of higher degree as compared to the one punishable under Section 465 Indian Penal Code. ( 15 ) THIS brings me to the offences under Sections 465 and 467 Indian Penal Code. Both these Sections provide punishment for the offence of forgery. Of course, the offence envisaged in Section 467 is graver in nature and of higher degree as compared to the one punishable under Section 465 Indian Penal Code. Section 463 defines forgery as making of a false document or a part of the document with one of the criminal intents specified therein. The actus reus is making a false document and the mens rea may be anyone of those mentioned in the said Sec. Sec. 464 elaborately defines "what is making a false document". Under its first part, a person is said to make a false document who dishonestly or fraudulently makes, signs, seals or executes a document, or makes any mark denoting the execution of a document, with the intention of causing it to be believed that such document or part of a document was made, signed, sealed or executed by or by the authority of a person by whom or by whose authority he knows that it was not made, signed, sealed or executed, or at a time at which he knows that it was not made, signed, sealed or executed. On its plain language it is evident that a false document is one which purports to be on its face what it is not i. e. it is not signed, sealed or executed etc. by the person by whom it purports to have been made, signed, sealed or executed. It consists in counterfeiting a document. In the words of Blackburn, J. : "forgery is the false making of an instrument purporting to be that which it is not; it is not the making of an instrument which purports to be what it really is, but which contains false statements. Telling a lie does not become a forgery because it is reduced into writing. The guilt of the thing which he has cone is by no means more than that. He has not made any statement that is purported to be made by the authority of any person on behalf of that person. "[see Exparte Charles Windsor, (1865) 12 LTR 307 ( (QB)] (7 ). The guilt of the thing which he has cone is by no means more than that. He has not made any statement that is purported to be made by the authority of any person on behalf of that person. "[see Exparte Charles Windsor, (1865) 12 LTR 307 ( (QB)] (7 ). This statement of law was quoted by Kelly, C. B. in The Queen v. William Ritson and Samuel Ritson, (1869) 1 (8) Law Reports Crown Cases 200, as under:- "the definition of forgery is not, as has been suggested in argument, that every instrument containing false statements fraudulently made is a forgery; but, adopting the correction of my Brother Blackburn, that every instrument which fraudulently purports to be that which it is not is a forgery, whether the falsenes of the instrument consists in the fact that it is made in a false name, or that the pretended date, when that is a material portion of the deed, is not the date at which the deed was in fact executed. " ( 16 ) APPLYING this test to the facts of the instant case, it appears to me that no offence of forgery can be said to have been made out against the petitioners even prima facie. It is for the reason that admittedly the video tape Ex. P2, which is infringing copy of the film inquestion, carries both insignia and the monogram of the Company itself. Further, it was admitted by the respondent-complainant in his deposition that his name as producer of the cinematograph film in question, the banner of his firm Belco Movies, the names of all the artistes and directors, who had been employed by him for making the film, appeared in the video tape when it was played by him or. the VCR. So by no stretch of reasoning it can be said that the video tape Ex. P2, purported to be the product of the Company as such. It was just a reproduction of the film in question and nothing more. Hence, it cannot be said to be a false document within the meanings of Section 464 Indian Penal Code. Consequently offences under Sections 465 and 467 Indian Penal Code are not at all made out even on admitted facts. It was just a reproduction of the film in question and nothing more. Hence, it cannot be said to be a false document within the meanings of Section 464 Indian Penal Code. Consequently offences under Sections 465 and 467 Indian Penal Code are not at all made out even on admitted facts. ( 17 ) THE upshot of the whole discussion, therefore, is that while a prima facie case for infringement of copy right within the meaning of Section 63 of the Act is made out against the petitioners, the material on record does not spell out any case of forgery punishable under Section 465 or 467 Indian Penal Code. Hence, this petition is allowed in part and the impugned order is quashed so far as offences under Section 465 and 467 Indian Penal Code are concerned. The case is, therefore, remanded to the trial Court for proceeding further against the petitioners for offence under Section 63 of the Act, in accordance with law. The parties are directed to appear before the trial Court on 14th April, 1986.