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2023 DIGILAW 1406 (AP)

State of Andhra Pradesh v. Branch Manager/foreman

2023-10-20

A.V.RAVINDRA BABU, U.DURGA PRASAD RAO

body2023
JUDGMENT U. Durga Prasad Rao, J. - This intra-court writ appeal is filed by the appellants / respondents 1 to 4 under clause 15 of the Letters Patent aggrieved by the following order dated 19.10.2023 in I.AN.o.1/2023 in W.P.No.26644/2023 passed by the learned single Judge. The said order is: '17. In view of discussion supra, the notice, under Section 102 Cr.P.C. issued by the 4th respondent to freeze three accounts, referred to supra, is suspended pending further orders. The respondents 5 and 6 shall defreeze the accounts of the petitioners Margadarsi Chit Funds Private Limited, Visakhapatnam Branch vide Account No.328901010023011, 328901010023070 and 328901010036673 of Union Bank of India, Visakhapatnam Main Branch, Dabagardens forthwith. However, this order will not come in the way of 4th respondent in proceeding with its investigation in connection with Crime No.209 of 2023 of II Town Police Station, Visakhapatnam. 18. List the I.A. No.1 of 2023 after Dussehra Vacation, 2023.' 2. The factual matrix of the case which led to file the instant appeal is thus: (a) On 06.09.2023, the de facto complainant gave report to the S.H.O., II Town P.S. Visakhapatnam alleging that on receiving a phone call from the Chit Registrar Office of respondents herein, she went to their office and on perusal of the chit agreement document she informed them that the concerned chit was not subscribed by her and the signatures do not belong to her and the chit agreement for Rs.5.00 lakhs was not subscribed by her and she did not participate in the chit auction and that she did not receive any chit amount. She ultimately complained that the chit agreement was forged in her name by someone and the respondents with some others colluded and created the forged document. Basing on a complaint, a case in Cr.No.208/2023 was registered on 06.09.2023 by police under Section 419, 420, 467, 471, 409, 120B r/w 34 IPC and investigation was commenced. She ultimately complained that the chit agreement was forged in her name by someone and the respondents with some others colluded and created the forged document. Basing on a complaint, a case in Cr.No.208/2023 was registered on 06.09.2023 by police under Section 419, 420, 467, 471, 409, 120B r/w 34 IPC and investigation was commenced. (b) While so, the Investigating Officer issued a notice dated 05.10.2023 under Section 102 Cr.P.C. to the Branch Manager of Union Bank of India, Visakhapatnam Main branch / 5th respondent in W.P.No. 26644/2023 stating that the accused in the above case i.e., the Manager and others of Margadarsi Chit Fund Company Pvt. Ltd. were engaged in criminal activities concerning to the FIR No.208/2023 and pending investigation, if they are allowed to withdraw the amounts from their bank account Nos.(1) 328901010023011 (2) 328901010023070 and (3) 328901010036673 maintained with the 5th respondent, the investigation will be jeopardized. The I.O. thus instructed the Branch Manager to freeze the aforesaid bank accounts and not to allow any more operations / transactions until his further instructions. The Branch Manager in turn vide letter dated 05.10.2023 communicated to 1st respondent herein about the freezer of their accounts. (c) Challenging the said freezer of the accounts, respondents 1 and 2 herein have filed W.P.No.26644/2023 and in I.A.No.1/2023 learned single Judge passed the order mentioned supra with the following observation: 15. For the freezing of three accounts, referred to supra, as per Section 102 of Cr.P.C, there must be nexus with the offence alleged. As seen from the averments in the writ affidavit there are total 3570 subscribers with 77 chit groups and defacto complainant is one of the members in one chit group for chit value of Rs.5,00,000/-. The total amount freezed in 3 accounts referred to supra comes to Rs.2,95,93,017/-. No complaint was made by any of the members of other chit groups. Thus, freezing of three bank accounts, in the opinion of this Court, will cause prejudice to subscribers of 77 chit groups. Making allegations simplicitor for the purpose of taking aid of Section 102 of Cr.P.C is not sufficient and proper. It must be shown that allegation is found on such material so as to at least create reasonable suspension that the amount in the accounts is having some nexus or possibility of having nexus with the commission of offence. Making allegations simplicitor for the purpose of taking aid of Section 102 of Cr.P.C is not sufficient and proper. It must be shown that allegation is found on such material so as to at least create reasonable suspension that the amount in the accounts is having some nexus or possibility of having nexus with the commission of offence. After completion of investigation, the true facts will come to light. However, freezing of 3 accounts, at this stage, will cause irreparable loss and hardship. The loss caused to the petitioners will not be compensated for at a later point in time.' Thus, the learned single Judge having opined that there was no nexus between the alleged crime and the accounts seized, found that there was prima facie case in favour of writ petitioners as there were 3570 subscribers whose amounts are under the freezed three accounts and such freezer will cause irreparable loss, passed the impugned order. Hence, the writ appeal. 3. Heard arguments of Sri K.Jaganmohan Reddy, Special Government Pleader representing the appellants - State and Sri S. Nagamuttu and Sri Posani Venkateswarlu, learned Senior counsel representing Sri P.Sai Surya Teja, learned counsel for respondents. 4. Severely fulminating the order of learned single Judge, Sri K.Jaganmohan Reddy, learned counsel for appellants, would firstly argue that the learned single Judge has granted the main relief itself in the interlocutory application i.e., I.A.No.1/2023 even before the appellants have filed their counter in the writ petition, which is impermissible under law. To buttress his argument, he placed reliance on (1) State of Rajasthan v. M/s. Swaika Properties, (1985) 3 SCC 217 (2) State of Uttar Pradesh v. Sandeep Kumar Balmiki, (2009) 17 SCC 555 = 2009 SCC Online SC 1666 (3) State of Haryana v. Suman Dutta, (2000) 10 SCC 311 = 2000 SCC (L&S) 834. (a) Secondly, learned counsel would argue that as against freezer of the bank accounts of writ petitioners which was made in terms of Section 102 Cr.P.C. during the course of investigation, the writ petitioners have an efficacious and alternative remedy to approach the concerned court of Judicial Magistrate of First Class and file petition under Section 451 or 457 Cr.P.C. Instead of following the same, they have filed the writ petition which is not sustainable under law. On this proposition, learned counsel relied upon Anand Property Finance Limited. Rep. On this proposition, learned counsel relied upon Anand Property Finance Limited. Rep. by its Authorised Signatory Prashant Rambhau Tandle v. State of Telangana rep. by its Principal Secretary, Department of Home, 2022 SCC Online TS 3407. (b) Added to above, learned counsel sought to argue that the freezer of the bank accounts of the writ petitioners was in the best interest of furtherance of investigation to unearth the possible bogus chit transactions and cheating of some more gullible persons and therefore, the learned single Judge was not right in opining at the threshold of the investigation that there was no nexus between the crime and the freezer of the bank accounts. He thus prayed to allow the writ appeal and set aside the impugned order. 5. In oppugnation, learned Senior Counsel Sri Nagamuttu firstly argued on the maintainability of the writ appeal. In expatiation, he would argue that the order impugned was passed by the learned single Judge in connection with a criminal case and exercising criminal jurisdiction and thereby, intra-court writ appeal is not maintainable under clause 15 of the Letters Patent and if aggrieved, the appellants have to choose a suitable legal remedy before an appropriate forum. On this main and formidable argument, learned Senior Counsel sought to dismiss the appeal in limini. He placed reliance on the decision in Ram Kishan Fauji v. State of Haryana, (2017) 5 SCC 533 . (a) Nextly, refuting the arguments of learned counsel for appellants regarding the availability of efficacious alternative remedy, learned counsel argued that mere availability of the alternative remedy is not a bar for the learned single Judge to exercise the plenary jurisdiction under Article 226 of the Constitution when the fundamental right of trade and business of the writ petitioners was severely hampered on account of illegal freezer of their bank accounts. (b) While refuting the arguments of learned counsel for appellant that the learned single Judge ought not to have granted the main relief in the form of an interim relief, learned Senior Counsel argued that learned single Judge has not granted any main relief by way of interim order and on the other hand, learned Judge only suspended the freezer order and posted I.A.No.1/2023 after Dussehra Vacation. Referring to various provisions of the A.P. Chit Funds Act, 1971 learned Senior Counsel would argue that as per the scheme of the said Act, the amounts lying in different accounts are covered by different provisions of the said Act and even if the freezer of the accounts is suspended by learned single Judge, the writ petitioners cannot withdraw those amounts as per their choice overnight and therefore, the contention of the appellants that the main relief was granted by way of interim order is not correct. He would submit that the appellants can file their counter in I.A.No.1/2023 and also in the main writ petition and get ready in the writ petition. He thus prayed to dismiss the appeal in limini. 6. In view of the above respective arguments, the following points emerge for consideration in this appeal: (1) Whether the impugned order was passed by learned single Judge in criminal case by exercising criminal jurisdiction and if so, an intra-court appeal under clause 15 of the Letters Patent rules is not maintainable? (2) If point No.1 is held negatively, whether the impugned order is not sustainable in law in view of the contention of the appellants that main relief itself was granted in the interim order? (3) Whether the impugned order is liable to be set aside in view of availability of efficacious alternative remedy to the respondents / writ petitioners under Section 451 / 457 Cr.P.C.? 7. Point No.1: We have cogitated upon the respective contentions of either counsel on this point. While it is the contention of learned Senior Counsel for respondents that the impugned order being passed by learned single Judge in a criminal case while exercising the criminal jurisdiction, the intra-court writ appeal is not maintainable under clause 15 of the Letters Patent, in oppugnation, the contention of learned counsel for appellants is that though the impugned order was passed in connection with Cr.No.208/2023, however, it cannot be said that the order was passed by learned single Judge while exercising the criminal jurisdiction. On the other hand, the respondents / writ petitioners sought for a civil relief of setting aside the freezer of their bank accounts on the ground that such freezer hinders their business activities. On the other hand, the respondents / writ petitioners sought for a civil relief of setting aside the freezer of their bank accounts on the ground that such freezer hinders their business activities. In the light of such prayer only, learned single Judge passed the impugned order and therefore, the said order has the trappings of a civil order and therefore, intra-court appeal is sustainable. 8. We gave our anxious consideration to the above respective arguments. We must express our inability to accept the contention of learned counsel for appellants for the reason that admittedly, the Investigating Officer issued freezer proceedings dated 05.10.2023 to the Branch Manager of Union Bank of India under Section 102 Cr.P.C. during the course of investigation in Cr.No.208/2023. Therefore, the freezer of three bank accounts is a consequence of registration of crime for certain penal offences and investigation thereof. The said freezer led the respondents / writ petitioners to seek a direction to defreeze their bank accounts. Having found the ingredients of prima facie case, balance of convenience and irreparable loss in favour of the respondents / writ petitioners, learned single Judge suspended the freezer order. When all these factors are logically examined, it can be concluded that the said order was passed in connection with a criminal case while exercising the criminal jurisdiction. Therefore, the said order cannot be viewed disjunctively to come to a conclusion that it was a civil order. On the other hand, all the events which ultimately culminated in the impugned order should be viewed conjunctively to decide the nature of the order passed by the learned single Judge. 9. In Ram Kishan Fauji's case (5 supra) cited by the respondents, the Hon'ble Apex Court expounded the point as to when the relevant order is to be treated as the one passed by exercising the criminal jurisdiction or the one passed in civil proceedings. In that case, the appellant filed writ petition seeking to quash the orders of the Lokayukta recommending the registration of criminal case against him under the provisions of the Prevention of Corruption Act and also for a mandamus restraining the 1st respondent therein from initiating consequential proceedings on the basis of the orders of the Lokayukta. Pending the writ petition, it appears F.I.R was registered by the police. Pending the writ petition, it appears F.I.R was registered by the police. Learned single Judge passed an order that if there was any other material or information of corrupt practice of the petitioner, the State shall be at liberty to carry out the investigation as per law. The said order was questioned in intra-court appeal before the Division Bench by the State and the Division Bench stayed the operation of the judgment of the learned single Judge. The appellant filed CMA No.3930/LPA of 2015 for vacation of the said interim order but the Division Bench declined and made absolute the stay order. The said order was questioned before the Apex Court. The main contention of the appellant was that the LPA preferred by the State before the Division Bench was not maintainable inasmuch as the learned single Judge had passed the order by exercising the criminal jurisdiction. In that context, the Hon'ble Apex Court referring to various judgments, held thus: 61. As we find from the decisions of the aforesaid three High Courts, it is evident that there is no disagreement or conflict on the principle that if an appeal is barred under Clause 10 or Clause 15 of the Letters Patent, as the case may be, no appeal will lie. The High Court of Andhra Pradesh, however, has held that when the power is exercised Under Article 226 of the Constitution for quashing of a criminal proceeding, there is no exercise of criminal jurisdiction. It has distinguished the proceeding for quashing of FIR Under Section 482 Code of Criminal Procedure and, in that context, has opined that from such an order, no appeal would lie. On the contrary, the High Courts of Gujarat and Delhi, on the basis of the law laid down by this Court in Ishwarlal Bhagwandas (supra), have laid emphasis on the seed of initiation of criminal proceeding, the consequence of a criminal proceeding and also the nature of relief sought before the Single Judge Under Article 226 of the Constitution. The conception of 'criminal jurisdiction' as used in Clause 10 of the Letters Patent is not to be construed in the narrow sense. It encompasses in its gamut the inception and the consequence. It is the field in respect of which the jurisdiction is exercised, is relevant. The conception of 'criminal jurisdiction' as used in Clause 10 of the Letters Patent is not to be construed in the narrow sense. It encompasses in its gamut the inception and the consequence. It is the field in respect of which the jurisdiction is exercised, is relevant. (Emphasis Supplied) The contention that solely because a writ petition is filed to quash an investigation, it would have room for intra-court appeal and if a petition is filed under inherent jurisdiction Under Section 482 Code of Criminal Procedure, there would be no space for an intra-court appeal, would create an anomalous, unacceptable and inconceivable situation. The provision contained in the Letters Patent does not allow or permit such an interpretation. When we are required to consider a bar or non-permissibility, we have to appreciate the same in true letter and spirit. It confers jurisdiction as regards the subject of controversy or nature of proceeding and that subject is exercise of jurisdiction in criminal matters. It has nothing to do whether the order has been passed in exercise of extraordinary jurisdiction Under Article 226 of the Constitution or inherent jurisdiction Under Section 482 Code of Criminal Procedure. In this regard, an example can be cited. In the State of Uttar Pradesh, Section 438 Code of Criminal Procedure has been deleted by the State amendment and the said deletion has been treated to be constitutionally valid by this Court in Kartar Singh v. State of Punjab MANU/SC/1597/1994MANU/SC/1597/1994 : (1994) 3 SCC 569 . However, that has not curtailed the extraordinary power of the High Court to entertain a plea of anticipatory bail as has been held in Lal Kamlendra Pratap Singh v. State of Uttar Pradesh and Ors. MANU/SC/0449/ 2009MANU/SC/0449/2009 : (2009) 4 SCC 437 and Hema Mishra v. State of Uttar Pradesh and Ors. MANU/SC/0032/2014MANU/SC/0032/2014 : (2014) 4 SCC 453 . But that does not mean that an order passed by the Single Judge in exercise of Article 226 of the Constitution relating to criminal jurisdiction, can be made the subject matter of intra-court appeal. It is not provided for and it would be legally inappropriate to think so.' The Apex Court ultimately allowed the appeal. 10. Thus, from the above jurisprudence, it is clear that it is the field in respect of which the jurisdiction is exercised is relevant to decide whether the relevant order was under criminal law or civil law. It is not provided for and it would be legally inappropriate to think so.' The Apex Court ultimately allowed the appeal. 10. Thus, from the above jurisprudence, it is clear that it is the field in respect of which the jurisdiction is exercised is relevant to decide whether the relevant order was under criminal law or civil law. Applying the same, in the instant case, it is a writ large that the impugned order was passed by the learned single Judge by exercising the criminal jurisdiction in the context of a criminal case. 11. Therefore, we hold, since the order impugned was passed in exercising the criminal jurisdiction, the instant intra-court appeal is not maintainable. This point is answered accordingly. 12. Points 2 and 3: In view of our finding in respect of Point No.1, it is wholly unnecessary for us to discuss and decide these two points. 13. Thus, on a conspectus of facts and law, the writ appeal is dismissed, however, with an observation that the appellants are at liberty to file their counter in the main writ petition, in which case, we hope and trust learned single Judge will afford an opportunity of hearing to both parties and pass an appropriate order expeditiously without being influenced by the observations made in this order. No costs. As a sequel, interlocutory applications if any pending, shall stand closed.