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2017 DIGILAW 681 (GUJ)

M. R. Harshe v. State of Gujarat

2017-03-24

A.J.SHASTRI

body2017
JUDGMENT : A.J. Shastri, J. 1. The petitioners who are the original accused Nos. 3 and 4 have approached this Court for challenging the legality and validity of order dated 30.7.2009 passed by the learned Special Judge, CBI Court No. 5, Mirzapur, Ahmedabad below Exh. 77 whereby, request for discharge from the prosecution in the form of Special Case No. 41 of 1999 came to be rejected. 2. The factual background upon which the present petition is brought before this Court is that the present petitioners were the employees of Deepak Nitrite Ltd. at the relevant point of time and were arraigned as an accused in Special Case No. 41 of 1999 arising out of RC 9(A)/97-ABD by the CBI, Gandhinagar against present petitioners - accused for offence punishable under Section 120-B of the IPC and Section 13(2) r/w Section 13(1)(d) of the Prevention of Corruption Act. In response to this, the petitioners appear to have submitted an application under Section 227 of the Cr.P.C. for seeking discharge from the prosecution, inter-alia, contending that the entire charge-sheet and the documents contained therewith do not constitute any offence against the petitioners nor reflecting any complicity with the case nor any material on record to justify any connectivity with respect to bribe being offered or given to the officers of KRIBHCO. The petitioners have not even acted in their individual capacity and there was purely a commercial dealing between two companies in which petitioners have no nexus except the fact that the petitioners were the employees of the company at the relevant point of time. A specific role has not been described as to how a guilt prima facie of petitioners is established even from the submission of the charge-sheet and therefore, said application was submitted before the court concerned which came to be rejected vide order dated 30.7.2009. It appears from the record that initially there wee 3 petitions were tagged together, out of which Special Criminal Application No. 1660 of 2009 came to be withdrawn and another came to be allowed and this being the left out petition, is now taken up to its logical end on merit in accordance with law. 3. The gist of the entire case is that one Shri H.C. Malhotra while working as Director (Marketing) KRIBHCO and other officials of KRIBHCO entered into a criminal conspiracy as alleged with one Mr. 3. The gist of the entire case is that one Shri H.C. Malhotra while working as Director (Marketing) KRIBHCO and other officials of KRIBHCO entered into a criminal conspiracy as alleged with one Mr. M.R. Harshe, General Manager (Materials) and others of M/s. Deepak Nitrite Ltd., Baroda somewhere around 1994-95 in respect of supply of ammonia quantity at the discounted price and caused a wrongful pecuniary loss to the KRIBHCO. It was further the case of prosecution that on 13.02.1995, the rate of ammonia was raised from Rs. 6,400/- to Rs. 7,000/- per metric tone in the year 1995-96, even then the firm was allowed to lift ammonia quantity by giving discount of Rs. 1,000/- per metric tone on the old rate i.e. Rs. 6,400/- and this way pecuniary advantage has been passed on by abusing the position of being a public servant without intimating the enhanced rate of ammonia to the plant at Surat. It was also asserted in the complaint that KRIBHCO plant at Surat had a capacity of stocking maximum quantity of 4,000 metric tone and though on 31.03.1995 the stock of ammonia had come down within the permissible limit, the special discount as referred to above was given to the firm, namely, M/s. Deepak Nitrite Ltd., Baroda and this is how a huge pecuniary advantage is passed on to the firm resulting into filing of the aforesaid complaint. 4. In the background of aforesaid facts, present petition is brought before this Court by contending that the material indicates that there is no connectivity prima facie establishing the guilt in any form of the present petitioners and therefore, the learned Judge ought to have considered the request of the petitioners for discharging from the prosecution. In addition thereto, it has been contended that a commercial deal came to be entered into between two companies where present petitioners have no role to play in their individual capacity and there is no provision of vicarious liability in the offence stipulated under the Prevention of Corruption Act and therefore, ex-facie no offence is made out. In addition thereto, it has been contended that a commercial deal came to be entered into between two companies where present petitioners have no role to play in their individual capacity and there is no provision of vicarious liability in the offence stipulated under the Prevention of Corruption Act and therefore, ex-facie no offence is made out. It was also contended that upward revision in basic price of supply of ammonia was a commercial decision of the company and not the individual decision of the petitioners and therefore, in such kind of commercial deal between two companies, the petitioners may not be allowed to drag into prosecution more particularly when the company is very much available to face the criminal prosecution and on this premise, the case was put up before this Court by placing detailed amendment pursuant to the order of this Court. Various contentions have been raised before this Court to substantiate the relief prayed for in the petition. 5. Mr. P.M. Thakkar, learned senior counsel for Thakkar & Pahwa Advocates for the petitioners has contended that so far as present petitioners are concerned, no case prima facie is made out from the entire detailed charge-sheet. On the contrary, the charge-sheet contains no specific allegations or attribution by virtue of which even a remote inference can be drawn about the involvement of present petitioners in commission of crime. Mr. P.M. Thakkar, learned senior counsel has further submitted that even the statement contained in the charge-sheet is also not attributing anything beyond a point whereby, it can be culled out that a serious offence under the Prevention of Corruption Act is committed by the petitioners and therefore, drawing the attention of the Court to various provisions of the Prevention of Corruption Act and also to relevant papers attached to the petition compilation, Mr. P.M. Thakkar, learned senior counsel has specifically contended that no offence is made out much less an offence under the Prevention of Corruption Act and therefore, in absence of remote connectivity or material, the petitioners cannot be continued to languish in litigation which would be a coercive step against the petitioners for no fault on their part. 5.1 Mr. P.M. Thakkar, learned senior counsel has submitted that it appears from the charge-sheet from its entirety that substantial role is being played in the alleged offence by one Mr. H.C. Malhotra as also by Mr. 5.1 Mr. P.M. Thakkar, learned senior counsel has submitted that it appears from the charge-sheet from its entirety that substantial role is being played in the alleged offence by one Mr. H.C. Malhotra as also by Mr. U.M. Mehta and it is emerging from the record that they are the real persons in charge of the affairs of the company which has erupted the present complaint and therefore, from the entire relevant compilation, no material worth the name is involving the present petitioners and therefore, it can safely be inferred that no offence is committed by the petitioners. It is also pointed out by learned senior counsel for the petitioners that in absence of any such cogent and sufficient material, such coercive prosecution against the petitioners may not be continued. Mr. Thakkar, learned senior counsel has further drawn the specific attention of this Court to a decision delivered by this Court on 11.11.2016 by taking into consideration all relevant facts and the case law related to present controversy and has contended that this is also a similar situation in which, a view may be taken to quash the complaint in so far as it relates to present petitioners. Mr. Thakkar has further contended that ultimately during the course of trial if any further made is found out in the form of evidence then, certainly a power can be resorted to Section 319 of the Cr.P.C. and therefore, upon broad concession in that direction, Mr. Thakkar has requested the Court to allow the petition on similar line as that of Special Criminal Application No. 1660 of 2009 and ultimately, prayed to allow the petition. 6. To oppose the stand taken by Mr. P.M. Thakkar, learned senior counsel, Mr. R.C. Kodekar, learned Special Public Prosecutor (CBI) for the respondent No. 2 has also contended that it may be that both the companies have entered into a commercial deal but, the petitioners have also played a vital role in giving an ultimate outcome to the transaction and therefore, at this stage of the proceedings, the petitioners may not be allowed to scot free. However, upon query from the Court about indicating any clinching material against the petitioners, Mr. Kodekar has candidly submitted that no specific material sufficient enough is available and therefore, has contended that ultimately same will be taken care of by the court concerned where the trial is taking place. However, upon query from the Court about indicating any clinching material against the petitioners, Mr. Kodekar has candidly submitted that no specific material sufficient enough is available and therefore, has contended that ultimately same will be taken care of by the court concerned where the trial is taking place. 6.1 Mr. Kodekar has then after arguing the matter for some time has contended that similar measure to prosecution be made available to apply for Section 319 of the Cr.P.C. if evidence during the course of adjudication is emerging against the petitioners and ultimately, has left the matter in the similar form of Special Criminal Application No. 1660 of 2009. 7. Having heard the learned counsel appearing for the respective parties and having gone through the material on record, it is emerging from the record that there seem to be no cogent and sufficient material available qua the present petitioners and looking to the entire assertion in first information report as well as charge-sheet to connect and continue the present petitioners in prosecution, there seem to be no reflection of any of the ingredients of the offence alleged and therefore, when the record indicates that substantial role and the material is related to that of one Mr. H.C. Malhotra and by Mr. U.M. Mehta to continue the petitioners at this stage in coercive process is nothing but the miscarriage of justice. However, the Court is also mindful of the fact that if during the course of trial if any evidence is found against the petitioners then, certainly it is open for the Court as well as the prosecution to move and take resort to Section 319 of the Cr.P.C. as is legally permissible and therefore, keeping this liberty open for the prosecution, the present petition is required to be disposed of as prima facie no evidence at this stage made out against the petitioners. 8. The record indicates that petitioner No. 1 - original accused No. 3 and petitioner No. 2 who is original accused No. 4 are also arraigned in the prosecution for the offences punishable under Sections 120-B and 420 of the IPC and under Section 13(2), 13(1)(d) of the Prevention of Corruption Act. To constitute an offence of cheating, the prosecution is required to establish dishonest intention from the very beginning which is sine qua non to hold the accused of commission of such crime. To constitute an offence of cheating, the prosecution is required to establish dishonest intention from the very beginning which is sine qua non to hold the accused of commission of such crime. Her, on the case on hand, even if the allegations made in the complaint are accepted as true and correct, if the role alleged against the petitioners to be seen, it may not be possible to be said in any way that they are guilty of offence of Section 420 of the IPC. Looking to the petitioners' scratcher in the company, the inducement element and delivery of the property is completely appearing to be missing and therefore, even if the allegations are to be stretched to the extent of establishing an offence under Section 420 of the IPC, the averments contained in the complaint are not possible to establish this offence against the petitioners and therefore, it transpires at this stage of the proceeding that no offence of cheating is made out against the petitioners. On bare reading of the averments contained in the complaint in co-relation with the charge-sheet papers, it appears that the transaction in question is purely a commercial transaction entered into between the two companies and this transaction is going on since long and cash credit discount facility is well known to the commercial transaction especially in cases of bulk purchases. The criminality or a special favour by the petitioners is not being emerged from the first information report and therefore, keeping in view the yardstick propounded by the Apex Court in case of State of Haryana & Ors. v. Ch. Bhajan Lal & Ors., reported in AIR 1992 SC 604 , the categories spelt out in the said judgment are not permitting to believe at this stage to safely conclude that petitioners are liable to the prosecution any further. v. Ch. Bhajan Lal & Ors., reported in AIR 1992 SC 604 , the categories spelt out in the said judgment are not permitting to believe at this stage to safely conclude that petitioners are liable to the prosecution any further. The ratio laid down by the said decision is reproduced hereinafter; "(a) where the allegations made in the First Information Report or the complaint, even if they are taken at their face value and accepted in their entirety do not prima facie constitute any offence or make out a case against the accused; (b) where the allegations in the First Information Report and other materials, if any, accompanying the F.I.R. do not disclose a cognizable offence, justifying an investigation by police officers under Section 156(1) of the Code except under an order of a Magistrate within the purview of Section 155(2) of the Code; (c) where the uncontroverted allegations made in the FIR or 'complaint and the evidence collected in support of the same do not disclose 265 the commission of any offence and make out a case against the accused; (d) where the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated under Section 155(2) of the Code; (e) where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused; (f) where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the concerned Act, providing efficacious redress for the grievance of the aggrieved party; (g) where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge." 8.1 In so far as the case with respect to Prevention of Corruption Act and the offence contained therein, what has been charged against the petitioners is violation of Section 13(1)(d) of the Prevention of Corruption Act. For immediate perusal, the said section is reproduced hereinafter: "Section 13(1)(d) If he:- (i) by corrupt or illegal means, obtains for himself or for any other person any valuable thing or pecuniary advantage; or (ii) by abusing his position as a public servant, obtains for himself or for any other person any valuable thing or pecuniary advantage; or (iii) while holding office as a public servant, obtains for any person any valuable thing or pecuniary advantage without any public interest; or" 9. A bare reading of the aforesaid provisions would clearly indicate that at the first flash, the petitioners cannot be said to be a public servant and if the averments contained in the FIR and the charge-sheet papers are to be looked into, the basic ingredient which is required for attracting criminal misconduct by public servant is completely missing. To prove the offence even on the basis of abetment to the crime by co-accused, there must be some significant role being played either in negotiation or in ultimate transaction. Such role is not being reflected from anywhere from the averments contained in the complaint as well as from the relevant charge-sheet and the dishonest intention is the prime consideration and essence of the offence under Section 13(1) of the Prevention of Corruption Act as held by the Apex Court in case of C.K. Jaffer Sharief v. State, reported in AIR 2013 SC 48 which is clearly reflected. No doubt the offences related to corruption are to be handled strictly but, that would not ipso facto applies to the persons, who are not visible to have committed such offences. From the papers contained in the charge-sheet and from the averments, at this stage it is not appearing that the offence which has been charged is established. However, this prima facie opinion is from the available material contained in the charge-sheet. But ultimately if during the course of trial and from the deposition and the evidence it is found that the petitioners have committed an offence then, the power under Section 319 of the Cr.P.C. is very much available and therefore, subject to that rider since at this juncture prima facie it is reflecting that no offence is committed under Section 13(1)(d) of the Prevention of Corruption Act as charged against the petitioners, the Court deems it proper not to allow them to languish in litigation. The fundamental principle of criminal jurisprudence with regard to liability of an accused is empathetically dealt with by the Apex Court which lead to a situation where it is appearing that the petitioners are not required to be continued to be litigated by way of coercive method of prosecution. Such continuance in the opinion of the Court would tantamount to abuse of process of law and accordingly, the petition appears to be well founded and deserves to be accepted. Relevant observations of the said decision are reproduced hereinafter: "14. A bare reading of the aforesaid provision of the Act would go to show that the offence contemplated therein is committed if a public servant obtains for himself or any other person any valuable thing or pecuniary advantage by corrupt or illegal means; by abusing his position as public servant or without any public interest. The aforesaid provision of the Act, i.e., Section 13(1)(d) are somewhat similar to the offence under Section 5(1) (d) of the Prevention of Corruption Act, 1947. 16. A fundamental principle of criminal jurisprudence with regard to the liability of an accused which may have application to the present case is to be found in the work "Criminal Law" by K.D. Gaur. The relevant passage from the above work may be extracted below: "Criminal guilt would attach to a man for violations of criminal law. However, the rule is not absolute and is subject to limitations indicated in the Latin maxim, actus non facit reum, nisi mens sit rea. It signifies that their can be no crime without a guilty mind. To make a person criminally accountable it must be proved that an act, which is forbidden by law, has been caused by his conduct, and that the conduct was accompanied by a legally blameworthy attitude of mind. Thus, there are two components of every crime, a physical element and a mental element, usually called actus reus and mens rea respectively." 17. It has already been noticed that the appellant besides working as the Minister of Railways was the Head of the two Public Sector Undertakings in question at the relevant time. It also appears from the materials on record that the four persons while in London had assisted the appellant in performing certain tasks connected with the discharge of duties as a Minister. It also appears from the materials on record that the four persons while in London had assisted the appellant in performing certain tasks connected with the discharge of duties as a Minister. It is difficult to visualise as to how in the light of the above facts, demonstrated by the materials revealed in the course of investigation, the appellant can be construed to have adopted corrupt or illegal means or to have abused his position as a public servant to obtain any valuable thing or pecuniary advantage either for himself or for any of the aforesaid four persons. If the statements of the witnesses examined under Section 161 show that the aforesaid four persons had performed certain tasks to assist the Minister in the discharge of his public duties, however insignificant such tasks may have been, no question of obtaining any pecuniary advantage by any corrupt or illegal means or by abuse of the position of the appellant as a public servant can arise. As a Minister it was for the appellant to decide on the number and identity of the officials and supporting staff who should accompany him to London if it was anticipated that he would be required to perform his official duties while in London. If in the process, the Rules or Norms applicable were violated or the decision taken shows an extravagant display of redundance it is the conduct and action of the appellant which may have been improper or contrary to departmental norms. But to say that the same was actuated by a dishonest intention to obtain an undue pecuniary advantage will not be correct. That dishonest intention is the gist of the offence under section 13(1)(d) is implicit in the words used i.e. corrupt or illegal means and abuse of position as a public servant. A similar view has also been expressed by this Court in M. Narayanan Nambiar v. State of Kerala while considering the provisions of section 5 of Act of 1947. If the totality of the materials on record indicate the above position, we do not find any reason to allow the prosecution to continue against the appellant. Such continuance, in our view, would be an abuse of the process of court and therefore it will be the plain duty of the court to interdict the same." 10. If the totality of the materials on record indicate the above position, we do not find any reason to allow the prosecution to continue against the appellant. Such continuance, in our view, would be an abuse of the process of court and therefore it will be the plain duty of the court to interdict the same." 10. The Court while coming to this conclusion has taken the assistance of following proposition laid down by the Apex Court in various cases which are as under: "(1) Maksud Saiyed v. State of Gujarat & Ors., reported in (2008) 5 SCC 668 . (2) Thermax Limited & Anr. v. K.M. Johny & Ors., reported in (2011) 13 SCC 412 . (3) GHCL Employees Stock Option Trust v. India Inforline Limited, reported in (2013) 4 SCC 505 . (4) Sunil Bharti Mittal v. Central Bureau of Investigation, report in (2015) 4 SCC 609 ." 11. The law on the issue of exercise of extraordinary jurisdiction is sufficiently explained over the period of time and in series of cases it has been held that of course, there is no straitjacket formula to exercise the jurisdiction but, there is no embargo upon exercise of such jurisdiction if facts are warranting and therefore, simply because the criminal case is lodged and the petitioners are joined, it cannot be said that such person in absence of any cogent material can be allowed to languish in litigation till the trial is over. The law on the aspect is sufficient enough to indicate right from 1963 onwards that even after filing of the charge-sheet the power to quashing can be exercised. The Apex court has consistently held that if facts are so warranting, the power to quash the complaint can be exercised and such proposition of law laid down by the Hon'ble Apex Court in case of D.P. Gulati Manager Accounts, Jetking Infotrain Limited v. State of Uttar Pradesh & Anr., reported in 2015 (11) SCC 730 . Relevant observations of the said decision are reproduced hereinafter: "7. We have carefully considered the rival submissions made before us. From a bare perusal of Section 482 of the Code, it is clear that the object of exercise of power under the Section is to prevent abuse of process of law, and to secure ends of justice. Relevant observations of the said decision are reproduced hereinafter: "7. We have carefully considered the rival submissions made before us. From a bare perusal of Section 482 of the Code, it is clear that the object of exercise of power under the Section is to prevent abuse of process of law, and to secure ends of justice. In Rajiv Thapar v. Madan Lal Kapoor, this Court has enumerated the steps required to be followed before invoking inherent jurisdiction by the High Court under Section 482 of the Code as under: 30. Based on the factors canvassed in the foregoing paragraphs,. We would delineate the following steps to determine the veracity of a prayer for quashment raised by an accused by invoking the power vested in the High Court under Section 482 of Cr. P.C. 30.1 Step one: Whether the material relied upon by the accused is sound, reasonable, and indubitable i.e. the material is of sterling and impeccable quality? 30.2 Step two: Whether the material relied upon by the accused would rule out the assertions contained in the charges levelled against the accused i.e. the material is sufficient to reject and overrule the factual assertions contained in the complaint i.e. the material is such as would persuade a reasonable person to dismiss and condemn the factual basis of the accusations as false? 30.3 Step three: Whether the material relied upon by the accused has not been refuted by the prosecution/complainant; and/or the material is such that it cannot be justifiably refuted by the prosecution/complainant? 30.4 Step four: Whether proceeding with the trial would result in an abuse of process of the court, and would not serve the ends of justice? 30.5 If the answer to all the steps is in the affirmative, the judicial conscience of the High Court should persuade it to quash such criminal proceedings in exercise of power vested in it under Section 482 of Cr.P.C. such exercise of power, besides doing justice to the accused, would save precious court time, which would otherwise be wasted in holding such a trial (as well as proceedings arising therefrom) specially when it is clear that the same would not conclude in the conviction of the accused. 8. In Rishipal Singh v. State of U.P., explaining the law in the similar circumstances, as in the present case, this Court observed, in para 17 as under: 17. 8. In Rishipal Singh v. State of U.P., explaining the law in the similar circumstances, as in the present case, this Court observed, in para 17 as under: 17. It is no doubt true that the courts have to be very careful while exercising the power under Section 482 Cr.P.C. At the same time we should not allow a litigant to file vexatious complaints to otherwise settle their scores by setting the criminal law into motion, which is a pure abuse of process of law and it has to be interdicted at the threshold.' In Rishipal Singh, the complainant, who was an accused in connection with an offence punishable under Section 138 of the Act, had filed a criminal complaint relating to offences punishable under Sections 34, 379, 411, 417, 418, 467, 468, 471 and 477 IPC." 12. From the aforesaid examination of record and the material attached to the petition compilation as well as looking to the proposition of law laid down in various decisions, it is emerging that no prima facie case is made out so far as present petitioners are concerned and therefore, the continue the present petitioners in prosecution tantamount to be a coercive step against them which would turn out to be an abuse of process of law and therefore, at this stage of the proceedings, in the absence of any cogent material, the Court deems it proper not to continue to the prosecution qua the present petitioners. However, while observing this a specific liberty is kept open for the prosecution to resort to Section 319 of the Cr.P.C. if from the testimony of witnesses and the evidence if any cogent material is found by the prosecution against the present petitioners then, certainly it would be open for the appropriate court to deal with the petitioners in accordance with law. 13. The Court, while considering the present petition, is also mindful of the fact that almost in similar set of circumstance, Special Criminal Application No. 1660 of 2009 is dealt with by this Court which came to be allowed and therefore, considering overall circumstance prevailing on record, the present petition is also dealt with and accordingly, disposed of in aforesaid terms. 14. 14. In view of above, the petition is allowed and the complaint being FIR RC No. 9(A)/97 ABD dated 22.01.1997 registered with C.B.I. Gandhinagar Police Station and subsequent proceedings related to it are hereby quashed and set aside in so far as it relates to present petitioners only and consequently order dated 30.07.2009 passed by the learned Special Judge, C.B.I. Court No. 5, Mirzapur, Ahmedabad below Exh. 77 is also hereby quashed and set aside in case of present petitioners. Rule is made absolute to the aforesaid extent.