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2009 DIGILAW 58 (ORI)

RAM CHANDRA SAHOO v. STATE OF ORISSA

2009-01-22

B.K.PATEL

body2009
JUDGMENT : B.K. Patel, J. - This revision is directed against order dated 20.02.2007 passed by the learned Special C.J.M. (Vigilance), Bhubaneswar in V.G.R: Case No. 39 of 2005 rejecting the Petitioner's prayer to discharge him of the charge framed for commission of offence u/s 7 of the Essential Commodities Act (for short 'the E.C. Act) and Section 409 of the Indian Penal Code (for short 'the I.P.C.'). 2. Petitioner's case is that he was appointed under the Public Distribution System (for short 'the P.D.S.') and other government schemes as a Storage Agent of food grains in terms of agreement at Annexure-3 entered in to between Orissa State Civil Supplies Corporation Limited and the Petitioner. In course of surprise check conducted by officers of Vigilance Department on 01.12.2005, in the Petitioner's depot, shortage of 10 quintals 10 kgs. 175 gms. of the stock of A.P.L. wheat was detected. On the basis of report lodged by Deputy Superintendent of Police, Vigilance, Unit Office, Puri, case was registered for commission of offences u/s 7 of the E.C. Act and Section 409 of the I.P.C. On completion of investigation, charge as stated supra was framed. The Petitioner had earlier approached this Court in Criminal Revision No. 93 of 2007 with a prayer to set aside the order of framing of charge. In the said revision the Petitioner was directed to approach the trial Court u/s 227 of the Code of Criminal Procedure Accordingly, the Petitioner filed an application u/s 227 of the Code of Criminal Procedure before the trial Court in response to which the impugned order was passed. 3. Though several grounds have been averred in the revision petition, learned Counsel appearing for the Petitioner confined his contention to the maintainability of the criminal proceeding against the Petitioner on the ground that the allegations in the case being of violation of terms of the agreement Ext.3, the Petitioner is not liable to be proceeded except in accordance with penal provision at Clause-2(B)(v) in the agreement itself. In this connection, learned Counsel for the Petitioner relied upon the decisions of the Hon'ble Supreme Court in Kailash Verma v. Punjab State Civil Supplies Corporation and Anr. 2005 (1) SC 246 : 2005 (1) OLR (SC) 544 and of this Court in S. Shankarmani and Ors. v. Nihar Ranjan Panda and Anr. (1989) 2 OCR 623. 4. In this connection, learned Counsel for the Petitioner relied upon the decisions of the Hon'ble Supreme Court in Kailash Verma v. Punjab State Civil Supplies Corporation and Anr. 2005 (1) SC 246 : 2005 (1) OLR (SC) 544 and of this Court in S. Shankarmani and Ors. v. Nihar Ranjan Panda and Anr. (1989) 2 OCR 623. 4. In reply, it was contended by the learned Counsel appearing for Vigilance Department that existence of contractual relationship between the parties and allegations of violation of terms of the contract do not provide blanket protection against initiation of criminal prosecution. Commission of offence under any penal statute is punishable by criminal Court irrespective of and apart from civil liabilities for which an accused may be liable to be proceeded against. It was further argued that agreement Ext.3 itself stipulates that in the event of the agreement being terminated by the Corporation, the Storage Agent shall be, in addition to any other liability, Civil, Criminal or under Orissa Public Demand Recovery Act or under the provision of CPC or under the terms of agreement or otherwise, liable to pay any loss or damage sustained to Corporation on account of such termination. In the present case, shortage of stock detected in the depot indicated misappropriation and breach of trust in respect of essential commodities under the P.D.S., meant for distribution to general public, on the part of the Petitioner which is punishable under the E.C. Act as well as under the I.P.C. 5. Having carefully perused the impugned order and materials on record, upon reference to the contention raised on behalf of the Petitioner, it is pertinent to note that though several contentions had been raised before the trial Court, the contention raised in the present revision was not advanced as a ground to discharge the Petitioner. All the grounds raised were dealt with in detail by the learned trial Court to conclude that there is no infirmity in framing of charge u/s 7 of the E.C. Act or Section 409 of the I.P.C. 6. Be that as it may, there appears no substance also in the contention that existence of contractual relationship between the Petitioner and Orissa State Civil Supplies Corporation Limited in terms of agreement Ext.3 constitutes an embargo against prosecution. Decisions relied upon on behalf of the Petitioner are distinguishable and of no assistance. Be that as it may, there appears no substance also in the contention that existence of contractual relationship between the Petitioner and Orissa State Civil Supplies Corporation Limited in terms of agreement Ext.3 constitutes an embargo against prosecution. Decisions relied upon on behalf of the Petitioner are distinguishable and of no assistance. On the facts and circumstances of the cases, the criminal proceedings were held to be not maintainable. 7. In Kailash Verma (supra) Appellant's firm had entered into an agreement with Respondent Punjab State Civil Supplies Corporation for dehusking of the paddy. In terms of agreement the firm was to supply advance rice to the Corporation which the firm was alleged to have failed to do for which prosecution was initiated for commission of offences under Sections 406 and 428 of the I.P.C. In response to the Appellant's application he was discharged by the Additional Chief Judicial Magistrate who was of the view that the allegation contained in the complaint was of civil nature and no criminal case was made out. It was also observed that there was no prima facie case to show that paddy was supplied to the accused and there was shortage of rice supplied to the Corporation. Order passed by the Additional Chief Judicial Magistrate was upheld in Revision by the Sessions Judge who noticed that the Corporation had initiated arbitration proceeding against the firm and also filed a complaint u/s 138 of the Negotiable Instruments Act. However, on further Revision filed before the High Court, orders passed by the Additional Chief Judicial Magistrate as well as Sessions Judge were set aside. Allowing the appeal and setting aside the judgment of the High Court, it was observed by the Hon'ble Supreme Court that as the dispute was civil in nature no offences were made out and that the Corporation also had initiated steps for arbitration proceedings on the basis of arbitration clause in the agreement. 8. In S. Shankarmani and Ors. (supra) legality of taking of cognizance of offence u/s 418 read with 109 of the I.P.C. in a complaint case initiated against the Petitioners was considered by this Court. Briefly stated, it was alleged by the complainant against the Petitioners, who were officers of United Commercial Bank, that they induced him to incur expenses for renovation of his house on the false pretext that the house would be taken up rent by the Bank. Briefly stated, it was alleged by the complainant against the Petitioners, who were officers of United Commercial Bank, that they induced him to incur expenses for renovation of his house on the false pretext that the house would be taken up rent by the Bank. Considering facts and circumstances of the case it was held that the allegations made in the case did not constitute offence of cheating. In this context, it was stated that mere breach of contract cannot lead to a criminal prosecution in the absence of any material to show that accused persons were actuated by dishonest intention. 9. Facts and circumstances of the present case are altogether different. The Petitioner stands charged for commission of offences u/s 7 of the E.C. Act and Section 409 of the I.P.C. None of the decisions relied upon by the Petitioner lays down as a general proposition of law that whenever a person is alleged to have violated terms of a contract and is liable to be proceeded with civil action, no criminal proceeding can be initiated against him. It may be kept in view that the objective of the agreement between Petitioner and Orissa State Civil Supplies Corporation Limited is to make available food grains/food stuff for ultimate distribution to general public under P.D.S. and other government schemes. The agreement stipulates responsibilities of the Petitioner as a Storage Agent. Such responsibilities include proper storage and accounting of essential commodities entrusted by the Corporation. It has been specifically stipulated that no shortage was allowed to the Storage Agent. Clause 2(B)(v) of the agreement stipulates that in case of shortage/misappropriation/diversion of Corporation stock, cost of shortage is to be recovered as below: xxxx Wheat- At the consumer price of APL wheat as fixed by Government or prevailing market price of wheat as per report of Market Intelligence Department of Government of Orissa which ever is higher. xxxx Besides this the MD shall have the right to forfeit the Security Deposit. xxxx Besides this the MD shall have the right to forfeit the Security Deposit. That apart, it has also been specifically provided under Clause-8(C) that in the event of the agreement being terminated by the Corporation, under the provision of Sub-clause (B) of Clause-8, the Storage Agent shall be in addition to any other liability, Civil, Criminal or under Orissa Public Demand Recovery Act, 1962 (Orissa) Act of (1963) or under the provision of CPC or under the terms of this agreement or otherwise, liable to pay any loss or damage sustained to Corporation on account of such termination. Clause-8(B)(iv) provides that the Corporation shall have the right to terminate the agreement forthwith at any time if it is found at any point of time that there was shortage of stocks. 10. P.D.S. system has been established to maintain smooth flow of essential commodities for consumption by the general public. In course of surprise check shortage of APL wheat, entrusted to the Petitioner as an Agent of the Corporation in terms of the agreement Ext.3 was detected. Such shortage amounts to contravention of not only the agreement but also Section 3 of the E.C. Act read with Orissa Public Distribution System (Control) Order, 2002 punishable u/s 7 of the E.C. Act, and to criminal breach of trust committed by an agent u/s 409 of the I.P.C. 11. Facts and circumstances of the present case, thus, go to show that allegations made against the Petitioner prima facie constitute commission of offences u/s 7 of the E.C. Act and Section 409 of the I.P.C. There is no scope for the Petitioner to find fault with the charge framed against him and the impugned order. There is no merit in the revision. Hence, the revision is dismissed. Final Result : Dismissed