Ashutosh Agrawal @ Ashutosh Agarwal son of Late Shri Atma Ram Agarwal v. State of Jharkhand
2020-02-28
ANUBHA RAWAT CHOUDHARY
body2020
DigiLaw.ai
JUDGMENT : 1. Heard Mr. Indrajit Sinha alongwith Mr. Bibhash Sinha, the learned counsel appearing for the petitioners. 2. Heard Mrs. Vandana Bharti, the learned A.P.P. appearing for the State and Mr. Kumar Nilesh, the learned counsel appearing for the Opposite Party No. 2. 3. This petition has been filed for the following reliefs :- “For quashing of the entire criminal proceedings initiated against the petitioners in connection with C.P. Case No. 1103 of 2017 including the order taking cognizance dated 05.05.018 passed by learned Judicial Magistrate, 1st Class, Bokaro, whereby he upon filing of the complaint and enquiry under Section 202 Cr.P.C. has been pleased to hold that there is sufficient ground for proceeding against the petitioners under Section 406 of the Indian Penal Code and accordingly, summoned them for facing trial and the case is now pending in the court of the learned Judicial Magistrate, 1st Class, Bokaro.” Arguments on behalf of the petitioners 4. Learned counsel for the petitioners submitted that ex-facie, upon reading of the Complaint Petition and perusal of the materials on record, no criminal case is made out against the petitioners. Learned counsel submitted that it is the specific case of the Complainant that the Complainant was employed as General Manager (H.R.) in the company named in the complaint petition. The Complainant had joined the company and subsequently, he had resigned and he alleged that the dues in connection with his salary, etc. were not paid to the Complainant due to which he filed the complaint case under Sections 406, 420, 120(B) of the Indian Penal Code. 5. Learned counsel submitted that admittedly, the company has not been made accused and as per the complaint case itself, it was the company who was employer of the Complainant and the amount, if any, was payable by the company. As per the complaint itself, there are only two accused persons who are petitioners before this court. It is further apparent from the complaint itself that the Petitioner No. 1 was Chief Finance Officer-cum-Executive Director of the company and the Petitioner No. 2 was the officer on Special Duty in the company and company is not an accused. 6.
As per the complaint itself, there are only two accused persons who are petitioners before this court. It is further apparent from the complaint itself that the Petitioner No. 1 was Chief Finance Officer-cum-Executive Director of the company and the Petitioner No. 2 was the officer on Special Duty in the company and company is not an accused. 6. Learned counsel relied upon a judgment passed by the Hon’ble Supreme Court reported in (2015) 12 SCC 781 (Sharad Kumar Sanghi vs. Sangita Rane) Para-11 as well as the judgment reported in (2008) 5 SCC 662 (S.K. Alagh vs. State of Uttar Pradesh and others) Para-19 to submit that the company having not been made accused in the present case and the entire claim of the Complainant is against the company, the petitioners cannot be prosecuted for vicarious liability of the company. He submitted that otherwise also, the entire criminal case arises out of the alleged non-payment of certain dues relating to the salary of the Complainant which is essentially a civil dispute and the present criminal proceedings against the petitioners is an abuse of the process of law calling for interference under section 482 of Code of Criminal Procedure to meet the ends of justice. Learned counsel submitted that the learned court below has not taken into consideration the aforesaid aspects of the matter while taking cognizance of offence against the petitioners and accordingly, the entire criminal proceeding including the impugned order taking cognizance against the petitioners is fit to be set aside. Arguments on behalf of the Opposite Party No. 2 7. Learned counsel appearing on behalf of the Opposite Party No.2 submitted that the petitioners are responsible for the amount which was not paid to the Complainant and having not paid the amount, the basic ingredients of criminal misappropriation of property is made out against them. However, during the course of argument, he is not in a position to dispute that the Complainant was employed by the company and the money, if any, was to be paid by the company. It is also not in dispute that the company has not been made accused in the complaint case and the entire case has been filed due to the grievance on account of alleged non-payment of salary, etc. by the company for the work done by the Complainant for the company. Findings of this court 8.
It is also not in dispute that the company has not been made accused in the complaint case and the entire case has been filed due to the grievance on account of alleged non-payment of salary, etc. by the company for the work done by the Complainant for the company. Findings of this court 8. As per the allegations made in the complaint case, the Complainant was appointed as General Manager (H.R.) in the company namely, Electrosteel Ltd. vide Letter dated 20.07.2015 and due to unavoidable reason, he desired not to work and resigned on 27.08.2016 and the Complainant was also issued a releasing letter showing no charge or dues against him. The grievance of the Complainant is that the accused persons intentionally avoided to pay money against his dues in spite of repeated requests and on this basis, it was alleged that the accused has committed the offences under Sections 406, 420, 120(B) of IPC. Admittedly, the Complainant was an employee of the company and dues, if any, are payable by the company, but the company has not been made accused in the case. 9. Considering the materials on record, this court finds that it is not in dispute that the Complainant was engaged by the company and the two accused i.e. the present petitioners were the Chief Finance Officer-cum-Executive Director and Officer on special duty respectively working in the company. Admittedly, the company has not been made accused in the Complaint Petition. The complaint case has been filed on account of non-payment of salary by the company for which the Complainant claims to have worked and the grievance of the Complainant is that the payment was not made to him inspite of repeated approach to the accused (petitioners). Thus, it is not in dispute that the Complainant was the employee of the company and payment, if any, was the liability of the company who has not been made accused. 10. In Para-19 of the judgment reported in (2008) 5 SCC 662 (S.K. Alagh vs. State of Uttar Pradesh and others), it has been held as under:- “19. As admittedly, drafts were drawn in the name of the Company, even if the appellant was its Managing Director, he cannot be said to have committed an offence under Section 406 of the Indian Penal Code.
As admittedly, drafts were drawn in the name of the Company, even if the appellant was its Managing Director, he cannot be said to have committed an offence under Section 406 of the Indian Penal Code. If and when a statute contemplates creation of such a legal fiction, it provides specifically therefore. In absence of any provision laid down under the statute, a Director of a company or an employee cannot be held to be vicariously liable for any offence committed by the Company itself. (See Sabitha Ramamurthy v. R.B.S. Channabasavaradhya.)” 11. In Para-11 of the judgment reported in (2015) 12 SCC 781 (Sharad Kumar Sanghi vs. Sangita Rane), it has been held as under:- “11. In the case at hand as the Complainant’s initial statement would reflect, the allegation are against the Company, the Company has not been made a party and therefore, the allegations are restricted to the Managing Director. As we have noted earlier, allegations are vague and in fact, principally the allegations are against the Company. There is no specific allegation against the Managing Director. When a company has not been arrayed as a party, no proceeding can be initiated against it even where vicarious liability is fastened under certain statutes. It has been so held by a three-Judge Bench in Aneeta Hada v. Godfather Travels and Tours (P) Ltd. in the context of the Negotiable Instruments Act, 1881.” 12. Considering the judgments relied upon by the petitioners reported in (2008) 5 SCC 662 (supra) and (2015) 12 SCC 781 (supra), the law is well settled that in a case where the liability is of the company, the employee of the company cannot be made vicariously liable for its non-payment in absence of the company being made co-accused in the case. It is not in dispute that the dues against salary, etc. of the Complainant, if any, were to be paid by the company and not by the present petitioners and the retention of any amount payable to the Complainant is by the company and not by the present petitioners.
It is not in dispute that the dues against salary, etc. of the Complainant, if any, were to be paid by the company and not by the present petitioners and the retention of any amount payable to the Complainant is by the company and not by the present petitioners. Moreover, the entire claim of the Complainant is a money claim and even if the entire allegations made against these petitioners is taken to be true, no criminal case, much less any criminal case under Sections 420/406 of Indian Penal Code is made out against the petitioners as the basic ingredients for constituting such offences by the petitioners is totally absent in the present case. 13. As a cumulative effect of the aforesaid findings, this court is of the considered view that the entire criminal proceeding against the petitioners is an abuse of the process of law calling for interference under Section 482 of Cr.P.C.. Accordingly, the entire criminal proceeding against the petitioners in connection with C.P. Case No. 1103 of 2017 including the order taking cognizance dated 05.05.2018 passed by the learned Judicial Magistrate, 1st Class, Bokaro is hereby quashed and set aside and this criminal miscellaneous petition is hereby allowed. 14. Pending I.A., if any, stands dismissed as not pressed. 15. Let this order be communicated to the court concerned through FAX.