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2016 DIGILAW 1026 (JHR)

Tata Motors Limited v. State of Jharkhand

2016-07-12

RAVI NATH VERMA

body2016
JUDGMENT : Ravi Nath Verma, J. - Invoking the inherent power of this Court under Section 482 of the Code of Criminal Procedure (in short “the Code”), the petitioner has prayed for quashing of the entire criminal proceeding including the order dated 07.03.2008 passed by Judicial Magistrate, 1st Class, Hazaribagh in Complaint Case no. 1219 of 2007, whereby and whereunder cognizance of offence has been taken against the petitioner under Section 406, 420 and 120-B of the Indian Penal Code. 2. Before I enter into the factual matrix of the prosecution case, the proposition of law that has emerged for consideration is whether the General Manager-cum-Production Manager an employee of a Company [though such post is not in existence in the said Company] would be liable for prosecution under the above provisions without the Company being arraigned as an accused? 3. At the instance of the complainant-opposite party no.2, a Complaint Case bearing no. 1219 of 2007 was instituted in the court of Chief Judicial Magistrate, Hazaribagh with the allegation that he had purchased one Tata Safari vehicle from Basudeo Auto Limited, Hazaribagh a dealer of Tata Motors Ltd. on 11.05.2007 on payment of Rs. 9,92,079/- through bank draft, but after taking delivery, the complainant found the A.C. of the vehicle not working properly and some white patches started appearing on the front part of the vehicle. On a complaint made by the complainant to the accused persons, the gas cylinder of the A.C. was filled and he was assured that the defective colour would also be attended to in due course but the complainant and his family went on a holiday trip to South India in the said vehicle and on way, technical snag developed in the vehicle, which was repaired at the cost of complainant. Again on 26.06.2007, the vehicle developed some technical problems and every time, the complainant had to incur expenses on repairing. After coming back to Hazaribagh, the break system of the vehicle developed major problem and seeing the regular technical problem, the complainant brought the vehicle to the workshop at Basudeo Auto Limited, Hazaribagh and after repairing, assurance was given by the Company that the vehicle is now free from all problems. On 18.07.2007, when the vehicle again developed some technical snag, it was brought to Basudeo Auto Limited, Hazaribagh. Whereafter, this complaint case was filed. 4. On 18.07.2007, when the vehicle again developed some technical snag, it was brought to Basudeo Auto Limited, Hazaribagh. Whereafter, this complaint case was filed. 4. It appears from the record that the learned Chief Judicial Magistrate after recording the statement of complainant on solemn affirmation further examined one witness under Section 202 of the Code and being satisfied with prima facie case against the petitioner and others, took cognizance of the offence as indicated above. Hence, this quashing application. 5. Mr. V.P.Singh learned senior counsel appearing for the petitioner assailing the order taking cognizance of offence as bad in law and against the settled principles, seriously contended that this petitioner Tata Motors Limited, a Company registered under the Indian Companies Act, has not been arrayed as a party in the complaint petition rather the General Manager-cum-Production Manager (Tata Safari) Tata Motors Passengers Car Business Unit, Pune, Maharashtra has been made party though no such post is in existence, the Company has preferred this petition. The said employee cannot be prosecuted for the offence punishable under the provisions in which cognizance has been taken without the company being arrayed as an accused. Since no summon has been issued in the name of company rather summon has been issued against the said employee but it has been served to the Company on behalf of the said post of the employee, the entire proceeding is vitiated in view of the mandates given by the Hon’ble Supreme Court in Aneeta Hada Vs. Godfather Travels and Tours Private Limited; (2012) 5 SCC 661 . It was further canvassed that the allegation relates to manufacturing defect in Tata Safari and for that instead of prosecuting the company, the complainant opted to prosecute an employee whose post is not even in existence and once a legal fiction is created by the statutory provision against the company as well as person responsible for the acts of the company, no penal action can be taken against such an employee of the company. In the entire complaint petition, there is no specific allegation against the General Manager-cum-Production Manager and the only allegation is that the complaint in writing was made to the accused persons. Learned counsel further relying upon a case Indian Oil Corporation Vs. In the entire complaint petition, there is no specific allegation against the General Manager-cum-Production Manager and the only allegation is that the complaint in writing was made to the accused persons. Learned counsel further relying upon a case Indian Oil Corporation Vs. NEPC India Limited reported in AIR 2006 S.C. 2780 submitted that the Hon?ble Supreme Court in the said case has held that there is a growing tendency in business circle to convert purely civil dispute into the criminal cases, obviously on account of a prevalent impression that civil law remedies are time consuming and do not adequately protect the interest of landers/creditors. Lastly, learned senior counsel relying upon a case State of A.P. Vs. Golconda Lingaswami and another; (2004) 6 SCC 522 submitted that the Hon’ble Supreme Court while considering almost similar issue held that if the allegations set out in the complaint do not constitute an offence in which cognizance has been taken by the Magistrate, it is open to the High Court to quash the same in exercise of inherent power under Section 482 of the Code. 6. Contrary to the aforesaid submissions, the learned counsel appearing for the complainant contended that there is no scope for interference by this Court as the case is in its initial stage and the General Manager-cum-Production Manager, even if such post is not available, was responsible for day-to-day affairs of the company and only because the company has not been arrayed as a party, the entire proceeding cannot be quashed and the accused cannot be allowed to escape from the penal liability. 7. I have carefully considered the submissions of the learned counsels and the decisions relied upon by the learned senior counsel appearing for the petitioner. It is well settled that judicial process is not an instrument of needless harassment and the court should be circumspect and judicious in exercising the discretion and should take all the relevant facts and circumstances into consideration before issuing process or taking cognizance of the offence. Obviously, summoning of an accused in a criminal case is a serious matter. The order taking cognizance and summoning of accused by the court must reflect that the court has applied its judicial mind to the facts of the case and the law applicable thereto. 8. Obviously, summoning of an accused in a criminal case is a serious matter. The order taking cognizance and summoning of accused by the court must reflect that the court has applied its judicial mind to the facts of the case and the law applicable thereto. 8. So far as the complaint petition is concerned, there is no specific allegation or even whisper against any employee of the company or against company and none of the ingredients responsible to constitute the offence under Section 406 or 420 or 120-B of the Indian Penal Code are available on record. The Hon’ble Supreme Court in the case Aneeta Hada (supra) while considering the prosecution under Section 138 of the Act held that for maintaining prosecution under Section 141 of the Act, arraigning of a company as an accused is imperative and in paragraph-58 held as follows: “58. Applying the doctrine of strict construction, we are of the considered opinion that commission of offence by the company is an express condition precedent to attract the vicarious liability of others. Thus, the words “as well as the company” appearing in the section make it absolutely unmistakably clear that when the company can be prosecuted, then only the persons mentioned in the other categories could be vicariously liable for the offence subject to the averments in the petition and proof thereof. One cannot be oblivious of the fact that the company is a juristic person and it has its own respectability. If a finding is recorded against it, it would create a concavity in its reputation. There can be situations when the corporate reputation is affected when a Director is indicated.” 9. In the instant case, the cognizance has been taken under Sections 406, 420 and 120-B of the Indian Penal Code. Hence before examining the allegations and the evidences, a reference of Section 405 and 406 of I.P.C. is necessary for the proper appreciation of the issue involved in this case, which are as follows:- “Section 405. In the instant case, the cognizance has been taken under Sections 406, 420 and 120-B of the Indian Penal Code. Hence before examining the allegations and the evidences, a reference of Section 405 and 406 of I.P.C. is necessary for the proper appreciation of the issue involved in this case, which are as follows:- “Section 405. Criminal breach of trust.- Whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied, which he has made touching the discharge of such trust, or willfully suffers any other person so to do, commits criminal breach of trust .” “Section 406. Punishment for criminal breach of trust.- Whoever commits criminal breach of trust shall be punished with imprisonment of either description for a term which may extend to three years, or with fine, or with both.” From bare perusal of the aforesaid two provisions, it would be apparent that an offence of criminal breach of trust consists of four positive acts namely misappropriation, conversion, user and disposal of property. The essential ingredients of the offence of criminal breach of trust are (i) the accused must have been entrusted with property or domain over it and (ii) the accused must have misappropriated the property or disposed of that property in violation of such trust. In the instant case, though there is an entrustment of the property i.e. the vehicle given to the dealer for inspection and removing of the defects, but there is not at all or any whisper about any misappropriation of the said property or disposal of that property in violation of such trust in the complaint petition. 10. I have carefully scrutinized the entire allegation made in the complaint petition, the statement of the witnesses examined during investigation under Section 202 of the Code and on careful scrutiny of the same, I find that there is no whisper about any role played by said employee and none of the ingredients responsible to constitute the offence alleged either against the said employee or against the company for which cognizance has been taken, are available in the instant case. Likewise none of the ingredients responsible to constitute the offence under Section 420 or 120-B of I.P.C. are available on record. It is true that no summon has been directly issued against the Company-petitioner but in absence of such post, the summon has been served upon the Company. The Company being a juristic person, the affairs of the Company is controlled by a group of persons. If there was any manufacturing defect in the said Car, the responsibility cannot be fastened on a particular post or on employee. If such a Company commits an offence involving mens rea, an individual even if has perpetrated commission of an offence in the capacity of an employee of the Company, can be made a party but along with the Company. Even the court below while taking cognizance has not recorded that there is sufficient incriminating evidence either against the employee or Company. Even if there was any defect in the vehicle and that was not repaired and removed by the dealer, there is civil remedy and the said company or any employee of the said company cannot be prosecuted and fastened with any criminal liability. Accordingly, the order taking cognizance as well as the continuance of the criminal proceeding against the petitioner, being absolutely uncalled for, deserves to be quashed. 11. In the result, the entire criminal proceeding pending in the court below including the order taking cognizance dated 07.03.2008, which relates to the petitioner, in Complaint Case no. 1219 of 2007 are, hereby, quashed. 12. This criminal miscellaneous petition is, accordingly, allowed. Petition allowed.