2009 (7) TMI 164 - HC - Customs

Court quashes criminal complaint post exoneration in departmental proceedings, citing abuse of court process

The Court quashed a criminal complaint under Sections 132 and 135 of the Customs Act, 1962, as the petitioner was exonerated in departmental proceedings. ... Guilty of committing offences under the Customs Act - if adjudication proceedings as well as criminal proceedings are permissible, both can be initiated simultaneously? Held that:- In case of converse situation namely where the accused persons are exonerated by the competent authorities/Tribunal in adjudication proceedings, one will have to see the reasons for such exoneration to determine whether these criminal proceedings could still continue. If the exoneration in department adjudication is on technical ground or by giving benefit of doubt and not on merits or the adjudication proceedings were on different facts, it would have no bearing on criminal proceedings. If, on the other hand, the exoneration in the adjudication proceedings is on merits and it is found that allegations are not substantiated at all and the concerned person(s) is/are innocent, and the criminal prosecution is also on the same set of facts and circumstances, the criminal prosecution cannot be allowed to continue. In these circumstances even though the petitioner is entitled for quashing, but since the second respondent has approached the Supreme Court and the SLP filed by them is still pending, the matter is adjourned sine die awaiting further orders by the Apex Court with liberty to the parties to revive the present petition, if required. Issues:1. Quashing of a criminal complaint under Sections 132 and 135 of the Customs Act, 1962 based on departmental adjudication.2. Justification for continuing criminal complaint after exoneration in departmental proceedings.3. Legal principles governing the quashing of criminal complaints in such situations.Analysis:Issue 1: The petitioner sought the quashing of a criminal complaint filed under Sections 132 and 135 of the Customs Act, 1962, based on departmental adjudication. The petitioner was exonerated in a second appeal before CESTAT, nullifying the basis of the complaint. Citing relevant judgments, the Court held that continuing criminal proceedings in such cases amounted to an abuse of the court process. The Court invoked its powers under Section 482 Cr.P.C. to quash the pending complaint.Issue 2: The respondents argued against quashing the complaint, citing a pending appeal before the Supreme Court, expressing concerns about potential complications if the complaint was quashed prematurely. However, the Court reiterated that once departmental adjudication exonerates the accused, continuing criminal proceedings become unjust. The Court referred to legal precedents emphasizing that exoneration in departmental proceedings on merits should lead to the termination of criminal prosecution based on the same set of facts.Issue 3: The Court relied on legal principles to determine the quashing of criminal complaints in such situations. It highlighted the need for a clear distinction between departmental adjudication and criminal prosecution, stating that exoneration in one does not automatically justify the continuation of the other. The Court emphasized that if departmental authorities find no contravention of the law, it would be unjust to pursue criminal liability based on the same allegations. The Court referred to previous judgments to support its decision to quash the complaint in light of the petitioner's exoneration in departmental proceedings.The Court adjourned the matter sine die due to a pending appeal before the Supreme Court, allowing parties to revive the petition if necessary. Additionally, an interim order granting stay of proceedings before the Trial Court was made absolute.