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2020 DIGILAW 2275 (KAR)

Greentex Mining Industries Ltd v. State

2020-11-19

JOHN MICHAEL CUNHA

body2020
JUDGMENT : 1. This petition is by accused No.16 and 17 in Crime No.17/2015 (Spl.C.C.469/2016) for the offences punishable under Sections 379,409 and 420 r/w Section 120-B of IPC and Sections 21 and 23 r/w Section 4(1), 4(1A) of Mines and Minerals (Development and Regulation) Act, 1957 (for short 'M.M.D.R. Act') and Rules 165 and 144 of the Karnataka Forest Rules, 1969. 2. The allegation made against the petitioners as per the charge sheet is that accused No.16 - M/s Greentex Mining Industries Ltd., and Accused No.17 - the Managing Director of Accused No.16 sold 2000 MT of Iron Ore to M/s.Alphine International without prior valid permit and invoice and without payment of royalty illegally transported the same from the stock yard of Ashwathanarayana Singh to Starmill stock yard and thereafter to the Belikeri Port and caused loss of Rs.24,13,415/- to the State Exchequer and thereby committed the aforesaid offences. 3. The learned counsel for petitioners has raised the following contentions: (i) The order of taking cognizance of the alleged offences is bad in law. It does not disclose application of mind by the learned Special Judge. Learned counsel has relied on the law laid down by the Hon'ble Supreme Court in the case of SUNIL BHARTI MITTAL Vs. CBI reported in (2015) 4 SCC 609 ; the Constitution Bench decision in the case of SARAH MATHEW Vs. INSTITUTE OF CARDIO VASCULAR DISEASES reported in (2014) 2 SCC 62 and the decision in the case of MEHMOOD UL REHMAN Vs. KHAZIR MOHAMMAD TUNDA and OTHERS reported in (2015) 12 SCC 420 and the decision reported in (2016) 14 SCC 430 . It is contended that the order taking cognizance being illegal, the subsequent proceedings initiated against the petitioners are liable to be quashed. 4. The learned counsel for petitioners contended that the allegations made against them go to show that they had purchased and sold iron ore in the port area. Petitioners are not required to obtain any license or permit either from the Mines Department or from the Forest Department. As per Section 9 of the M.M.D.R. Act, liability to pay royalty is on the holder of the mining lease. Petitioners are not required to obtain any license or permit either from the Mines Department or from the Forest Department. As per Section 9 of the M.M.D.R. Act, liability to pay royalty is on the holder of the mining lease. Referring to Sub-Section (2) of Section 9 of the M.M.D.R. Act, the learned counsel for the petitioners pointed out that as per the said provisions: "(2) The holder of a mining lease granted on or after the commencement of this Act shall pay royalty in respect of any 1 [mineral removed or consumed by him or by his agent, manager, employee, contractor or sub- lessee] from the leased area at the rate for the time being specified in the Second Schedule in respect of that mineral." 5. The learned counsel for the petitioners placed reliance on the case law in (2014) 6 SCC 590 and AIR 2008 All. 75 . Placing reliance on the decision of the Hon'ble Supreme Court in GOA FOUNDATION VS. UNION OF INDIA AND OTHERS, (2014) 6 SCC 590 and with reference to paragraphs 33 and 34 emphasized that under "Section 4 of the M.M.D.R. Act, a person who holds a mining lease granted under the MMDR Act and the Rules made thereunder is entitled to carry on mining operations in accordance with the terms of the lease in the leased area and may carry on all other activities connected with mining within the leased area." 6. Based on these observations, the learned counsel for petitioners would submit that the petitioners not holding any mining lease are not liable to pay royalty and therefore, charges leveled against the petitioners being illegal and an abuse of process of Court, are liable to be quashed. 7. The next contention urged by the learned counsel for petitioners is that the registration of FIR for the offences under the M.M.D.R. Act and the charge sheet filed for the alleged offences, is illegal in view of the bar contained under Section 22 of the M.M.D.R. Act. In support of this submission, learned counsel has placed reliance on the decision of the Hon'ble Supreme Court in the case of STATE (NCT OF DELHI) Vs. SANJAY reported in (2014) 9 SCC 772 . 8. In support of this submission, learned counsel has placed reliance on the decision of the Hon'ble Supreme Court in the case of STATE (NCT OF DELHI) Vs. SANJAY reported in (2014) 9 SCC 772 . 8. Lastly, it is contended that the charge sheet filed by the respondent does not disclose basic ingredients constituting offences alleged against the petitioners and in the said circumstances, proceedings initiated against the petitioners being illegal and an abuse of process of Court are liable to be quashed. 9. Meeting these arguments, the learned Special Public Prosecutor appearing for respondent at the outset would submit that the petitioners are sought to be prosecuted for the offences under Sections 4(1A) of the M.M.D.R. Act. The allegations made in the complaint squarely fall within the ambit of Section 4(1A) of the M.M.D.R. Act. There are clear allegations that the petitioners have admitted that they are traders and were involved in the purchase and exportation of the iron ore. Under the said circumstances, the allegations made against the petitioners clearly fall within the ambit of Section 4(1A) of the M.M.D.R. Act, as such, there no illegality in the proceedings initiated against the petitioners. 10. Regarding defect in the cognizance order as highlighted by the learned counsel for petitioners is concerned, the learned Special Public Prosecutor would submit that the order passed by the learned Special Judge taking cognizance of the alleged offences meets the legal requirements of the law laid down by the Hon'ble Apex Court as well as this Court in umpteen number of cases. There is a conceptual difference between the cognizance taken in the case arising out of a private complaint under Section 200 of Cr.P.C. and cognizance taken on the police report filed under Section 173 of Cr.P.C. 11. In the instant case, the learned Special Judge having taken cognizance on the basis of the police report/final report as well as in terms of the written complaint filed by the authorized officer in terms of Section 22 of the M.M.D.R. Act, no fault could be found with the order taking cognizance by the learned Special Judge. For the same reason, the learned Special Public Prosecutor would submit that the decisions relied on by the learned counsel for petitioners on this aspect, are not applicable to the facts of the case. 12. For the same reason, the learned Special Public Prosecutor would submit that the decisions relied on by the learned counsel for petitioners on this aspect, are not applicable to the facts of the case. 12. Lastly, with regard to the facts constituting ingredients of the offences alleged against the petitioners is concerned, the learned Special Public Prosecutor submitted that the allegations made in the complaint, charge sheet as well as the documents filed in support thereof clearly disclose the ingredients of the offences alleged against the petitioners, as such, there is no illegality whatsoever in the proceedings initiated against the petitioners and thus, sought for dismissal of the petition. Considered the submissions and perused the records. 13. Coming to the objection relating to the validity of the cognizance taken by the learned Special Judge and the consequent order of summons issued to the petitioners is concerned, a perusal of the order sheet produced by the petitioners indicate that on perusal of the FIR, Charge Sheet, Seizure mahazar and documents collected by the Investigating Officer, learned Special Judge has taken cognizance of the alleged offences and has issued summons to the petitioners. This order clearly reflects application of mind and consideration of the material leading to issuance of summons. The offences in respect of which summons are issued are also detailed in the order, as such, no fault could be found with the impugned order. 14. However, the difficulty arises in respect of the offences under the provisions of MMDR Act. Section 22 of the Act creates a restriction on the Courts in taking cognizance of the offences under the Act. The Section reads as under: "22. Cognizance of offences. "No court shall take cognizance of any offence punishable under this Act or any rules made thereunder except upon complaint in writing made by a person authorised in this behalf by the Central Government or the State Government." 15. Learned counsel for the petitioners/accused has placed heavy reliance on the decision of the Hon'ble Apex Court in STATE (NCT OF DELHI) vs. SANJAY, (2014) 9 SCC 772 , in paragraph 70, wherein it is held as under: "70. There cannot be any dispute with regard to restrictions imposed under the MMDR Act and remedy provided therein. Learned counsel for the petitioners/accused has placed heavy reliance on the decision of the Hon'ble Apex Court in STATE (NCT OF DELHI) vs. SANJAY, (2014) 9 SCC 772 , in paragraph 70, wherein it is held as under: "70. There cannot be any dispute with regard to restrictions imposed under the MMDR Act and remedy provided therein. In any case, where there is a mining activity by any person in contravention of the provisions of Section 4 and other sections of the Act, the officer empowered and authorized under the Act shall exercise all the powers including making a complaint before the jurisdictional magistrate. It is also not in dispute that the Magistrate shall in such cases take cognizance on the basis of the complaint filed before it by a duly authorized officer. In case of breach and violation of Section 4 and other provisions of the Act, the police officer cannot insist Magistrate for taking cognizance under the Act on the basis of the record submitted by the police alleging contravention of the said Act. In other words, the prohibition contained in Section 22 of the Act against prosecution of a person except on a complaint made by the officer is attracted only when such person sought to be prosecuted for contravention of Section 4 of the Act and not for any act or omission which constitute an offence under the Penal Code." (underlining supplied) 16. What emerges from the above decision is that based on the final report filed under Section 173 of the Code, the Special Court cannot take cognizance of the offences under the provisions of the MMDR Act. Apparently, to get over this restriction, the respondent appears to have filed a complaint in the proceedings before the Special court in terms of Section 22 of the MMDR Act. The learned Special Public Prosecutor for the respondent has made available copy of the complaint filed by the authorized officer before the learned Special Judge which contain the very same allegations as found in the charge sheet submitted by SIT. This complaint therefore could be taken as due compliance of the statutory requirement prescribed in Section 22 of the MMDR Act. This complaint therefore could be taken as due compliance of the statutory requirement prescribed in Section 22 of the MMDR Act. But the question still remains to be considered is, whether by mere filing the complaint, can it be said that the Special Court has taken cognizance of the offence based on the said complaint as mandated in Section 22 of the MMDR Act? 17. Though it is vehemently argued by the learned counsel for the petitioners/accused that such exercise has not been done by the Special Court as the impugned order of cognizance does not reflect that the learned Special Judge has looked into the averments made in the complaint yet, what is significant to be noted is that the allegations made in this complaint as well as the facts constituting the offences alleged against the petitioners/accused in the final report filed by the SIT are one and the same. Under the said circumstance, if the learned Special judge has looked into the allegations made in the final report filed by the SIT and on satisfying himself that these allegations prima facie disclose the commission of offences by the petitioners/accused under IPC as well as under the MMDR Act, it could possibly be held that the learned Special Judge has taken cognizance of the offences in terms of Section 22 of MMDR Act. 18. In drawing the above conclusion, I am fortified by the observations of the Hon'ble Supreme Court in the case of FAKHRUDDIN AHMAD vs. STATE OF UTTARANCHAL AND ANOTHER, (2008) 17 SCC 157 , wherein it is observed that "whether Magistrate has or has not taken cognizance of offence will depend upon circumstances of the particular case, including mode in which case is sought to be instituted and the nature of preliminary action". No doubt, even in the said case it is held that "before a Magistrate can be said to have taken cognizance of an offence, it is imperative that he must have taken notice of accusations and applied his mind to allegations made in complaint or in police report or information received from a source other than a police report, as the case may be, and material filed therewith. It is only when the Magistrate applies his mind and is satisfied that allegations, if proved, would constitute an offence and decides to initiate proceedings against the alleged offenders, that it can be positively stated that he has taken cognizance of the offence." 19. Similar view is taken in MEHMOOD UL REHMAN vs. KHAZIR MOHAMMAD TUNDA AND OTHERS, (2015) 12 SCC 420 , wherein it is held that "though no formal or speaking or reasoned orders are required at the stage of Ss.190/204 CrPC, there must be sufficient indication in the order that the Magistrate is satisfied that: (i) the facts alleged in the complaint constitute an offence, and (ii) these facts when considered along with the statements recorded under S.200 CrPC and the result of inquiry or report of investigation under S.202 CrPC, if any, prima facie make the accused answerable before the criminal court." 20. As the impugned order and the records of the proceedings disclose that the learned Special Judge has considered the material placed before him namely, the charge sheet which contain identical allegations as found in the complaint filed by the authorized officer under Section 22 of the Act, I hold the cognizance taken by the learned Special Judge and the summons issued by him in respect of MMDR offences is in accordance with Section 22 of MMDR Act. 21. Viewed from another angle, on filing a complaint either under Section 200 Cr.P.C. or under Section 22 of MMDR Act, the course open for the Court/Magistrate was either to take cognizance based on the facts alleged in the complaint or to refer the complaint for investigation under Section 156(3) of Cr.P.C. or to postpone the process and hold an enquiry in terms of Section 202 of Cr.P.C. In the instant case, detailed investigation into the alleged offences having already been undertaken by SIT pursuant to the directions of the Hon'ble Supreme Court and necessary evidence having been collected in respect of the alleged offences, the Special Court could not have ordered a parallel investigation nor could it have rejected the final report. It is not the case of the petitioners that the report submitted by the SIT is without authority of law. Even otherwise, investigating of the offences is within the domain of the police and the power of the police officer to investigate into cognizable offence is not ordinarily impinged by any fetters. It is not the case of the petitioners that the report submitted by the SIT is without authority of law. Even otherwise, investigating of the offences is within the domain of the police and the power of the police officer to investigate into cognizable offence is not ordinarily impinged by any fetters. There is no provision under the MMDR Act that the appropriate authority alone shall investigate any complaint of breach of any of the provisions of the MMDR Act. As observed by the Hon'ble Supreme Court in KANWAR PAL SINGH vs. THE STATE OF UTTAR PRADESH (Crl.Appeal No.1920/2019, arising out of SLP (Crl.) No.10707/2019, dated December, 18, 2019), "the violation of Section 4 being cognizable offence, the police could always investigated the same, there being no bar under the MMDR Act". Therefore, it follows that when the police have the power to investigate the contraventions of Section 4 of the Act, they have also the power to submit the final report. Therefore, no illegality could be attached to the final report and the evidence collected by the police officers in proof of the offences investigated by them under the Act. This report, therefore, cannot be excluded from consideration while taking cognizance of the offence under the Act, provided a complaint as required under Section 22 is filed by the authorized officer. If the argument of the learned counsel for the petitioners is accepted, despite there being a report on investigation, the Court has to either order for fresh investigation or hold an enquiry under Section 202 of Cr.P.C., which would tantamount to nullifying the investigation ordered by the Hon'ble Supreme Court and the Government of Karnataka, which in the circumstances of the case cannot be permitted. It is a cardinal principle of law that every law is designed to further the ends of justice and shall not be frustrated on mere technicalities. When the law authorizes the police/SIT to investigate the offences including the offences under the MMDR Act, the said report cannot be excluded from consideration at the stage of cognizance or issuance of summons to the accused subject to the compliance of the requirements of Section 22 of the MMDR Act. 22. When the law authorizes the police/SIT to investigate the offences including the offences under the MMDR Act, the said report cannot be excluded from consideration at the stage of cognizance or issuance of summons to the accused subject to the compliance of the requirements of Section 22 of the MMDR Act. 22. In the light of these principles and for the reasons discussed above, and especially keeping in mind the peculiarities of the present case and the special circumstances arising on account of the investigation report submitted by SIT, in my view, the course adopted by the learned Special Judge in considering the final report for issuing process to the petitioners cannot be faulted with. Likewise, as held in the above decisions, non recording the reasons by the Special Court while issuing summons to the petitioners also cannot be a reason to set aside the orders of cognizance and the summons issued to the petitioners. In the circumstances of the case, even if there is an error or omission on the part of the learned Special Judge, it is not something so vital as to cut at the root of jurisdiction so as to render the impugned order illegal or without jurisdiction so as to quash the entire proceedings as sought for by the petitioners. Since the petitioner No.2 was notified of the offences at the earliest point of time before his appearance, there is substantial compliance of the "outward forms of the law" as held by the Constitution Bench of the Apex Court in WILLIE (WILLIAM) SLANEY vs. STATE OF MADHYA PRADESH, AIR 1956 SC 116 . 23. As a result, I hold that the impugned order of cognizance and the consequent order of summons issued by the learned Special Judge do not suffer from any error or illegality vitiating the proceedings pending against the petitioners. 24. The contention of the petitioners that the alleged purchase had taken place in the port area and therefore, the petitioners are not liable to obtain the permit and to pay the royalty is misconceived. A reading of the charge sheet and the material produced therewith clearly goes to show that the petitioners are sought to be prosecuted under section 4(1A) of the M.M.D.R. Act. A reading of the charge sheet and the material produced therewith clearly goes to show that the petitioners are sought to be prosecuted under section 4(1A) of the M.M.D.R. Act. The section reads as under: "4(1A) No person shall transport or store or cause to be transported or stored any mineral otherwise than in accordance with the provisions of this Act and the Rules made thereunder." 25. There are clear allegations that the petitioners illegally transported the iron ore from the stock yard of Ashwathanarayana Singh to Starmill stock yard and thereafter to the Belikeri Port. These allegations squarely fall within the ambit of section 4(1A) of the M.M.D.R. Act. Therefore, even this contention does not merit acceptance and is accordingly dismissed. 26. Finally, the allegations made in the complaint which is duly supported by the materials collected by SIT during investigation, undoubtedly make out the ingredients of the offences under Sections 379, 409, 420 r/w 120(B) of IPC and Section 21 r/w 4(1A) of MMDR Act, 1957. In the course of the arguments, the learned Special Public Prosecutor has referred to the relevant documents which prima facie disclose the involvement of the petitioners in the alleged offences. Under the said circumstances, the criminal action having been rightly initiated against the petitioners, I do not find any justifiable ground to interfere in the impugned proceedings. Accordingly, rejecting the contentions urged by the learned counsel for the petitioners, the petition is dismissed. In view of dismissal of petition, all pending I.As are also dismissed. At this juncture the learned counsel for the petitioners seeks leave of the court to reserve the right of the petitioners to urge appropriate contentions before the trial court at the stage of hearing before charge. Such a right is available to the petitioners under law and the same is not taken away by this order. The Trial Court shall hear the petitioners and consider the grounds raised at the stage of hearing before charge and shall proceed in the matter as per law.