2025 (7) TMI 838 - SC - Indian Laws

Company victim of counterfeit sales can appeal acquittal under Section 372 CrPC proviso despite police report origin

ASIAN PAINTS LIMITED Versus RAM BABU & ANOTHER, R1: RAM BABU, R2: STATE OF RAJASTHAN THROUGH P.P., JAIPUR

ASIAN PAINTS LIMITED Versus RAM BABU & ANOTHER, R1: RAM BABU, R2: STATE OF RAJASTHAN THROUGH P.P., JAIPUR - 2025 INSC 828 The core legal question considered by the Court is whether the appellant qualifies as a 'victim' under Section 2(wa) of the Code of Criminal Procedure, 1973 ('CrPC') and thereby has the right to file an appeal under the proviso to Section 372 of the CrPC against an order of acquittal passed by the First Appellate Court, or whether the provisions of Section 378 of the CrPC, which regulate appeals in cases of acquittal, prevail and restrict such a right.Additional issues relevant to this primary question include:The interpretation and scope of the term 'victim' under Section 2(wa) CrPC, particularly in relation to a corporate entity and its authorized agents.The applicability and interplay of Sections 372, 374, and 378 of the CrPC concerning the maintainability of appeals by victims against acquittal orders passed by appellate courts.The procedural requirements and limitations imposed by Section 378 on appeals against acquittal, including the necessity of leave from the High Court.The legal status and locus of the appellant company in the criminal proceedings, especially given that the complaint was lodged by an investigator appointed by an intermediary consultancy firm authorized by the appellant.The correctness of the High Court's dismissal of the appellant's appeal on grounds of maintainability, including its interpretation of the complainant's role and the appellant's status as victim.Issue-wise Detailed Analysis1. Definition and Scope of 'Victim' under Section 2(wa) CrPCThe Court examined the statutory definition of 'victim' in Section 2(wa) CrPC, which defines a victim as 'a person who has suffered any loss or injury caused by reason of the act or omission for which the accused person has been charged,' explicitly including guardians and legal heirs. The Court noted that the term 'person' includes companies and bodies of persons by virtue of Section 11 of the Indian Penal Code. The appellant, being a corporate entity suffering financial and reputational loss due to counterfeit products sold under its brand, clearly falls within this definition.Precedent was drawn from the judgment in Jagjeet Singh v Ashish Mishra, which clarified that a victim need not be the complainant or informant; these are distinct legal concepts. The victim has participatory rights throughout investigation and trial, independent of who filed the complaint. This interpretation supports a liberal and expansive understanding of 'victim' to safeguard those who suffer loss due to crimes.The Court also considered the factual matrix: the appellant had authorized an IPR consultancy firm, M/s Solution, which in turn appointed an investigator to detect and act against infringement. Actions taken by the investigator were on behalf of the appellant, serving its interests. Thus, the appellant's loss due to counterfeit goods bearing its trademarks and copyrights was direct and tangible.2. Maintainability of Appeal under Proviso to Section 372 CrPC versus Section 378 CrPCSection 372 CrPC generally prohibits appeals unless expressly allowed, but its proviso grants victims the right to appeal against any order acquitting the accused or convicting for a lesser offence or imposing inadequate compensation. The proviso states such appeal lies to the court to which an appeal ordinarily lies against the order of conviction.Section 378 CrPC governs appeals in cases of acquittal, allowing the Public Prosecutor or State Government to appeal with leave of the High Court, and permitting complainants to seek special leave for appeals in complaint cases. The High Court had interpreted this to mean that the appellant, not being the complainant, could not maintain an appeal under Section 372 proviso, and that even the complainant's right was limited by the leave requirement under Section 378.The Court rejected this restrictive interpretation, holding that Section 372 proviso is a standalone, enabling provision that is not circumscribed by Section 378. The proviso confers a substantive right on victims to appeal independently of the procedural constraints of Section 378. The Court emphasized that the proviso's language is unambiguous and does not differentiate between acquittals by trial courts or appellate courts. Consequently, a victim may appeal an acquittal by the First Appellate Court to the High Court, as the latter is the next higher court in the hierarchy.The Court further noted that the High Court's finding that the appellant was not a victim because it was not the complainant was erroneous. The appellant was heard in the First Appellate Court with the consent of the parties and effectively participated as the complainant, despite no formal impleadment order. This further supports the appellant's locus to file the appeal.3. The Role of the Complainant and the Appellant's Locus in the ProceedingsThe Court analyzed the status of the complainant, Mr. Pankaj Kumar Singh, an investigator appointed by M/s Solution, which was authorized by the appellant. The Court found that actions taken by him were on behalf of the appellant, serving its interests in protecting its intellectual property rights. Hence, the appellant's interest was directly affected by the criminal proceedings.The Court also addressed the High Court's erroneous conclusion that the appellant's application for impleadment was rejected. The record showed the appellant's counsel was heard and permitted to assist the prosecution in the appeal, and no objection was raised by the parties. This reinforced the appellant's effective participation and status as victim in the appeal proceedings.4. Interpretation of the Right of Appeal by Victims and the Judicial HierarchyThe Court clarified that the proviso to Section 372 CrPC grants the victim a right to appeal 'against any order passed by the Court acquitting the accused,' without limiting the stage at which such acquittal occurs. In the present case, the acquittal was by the First Appellate Court (Sessions Court). Therefore, the victim's appeal lies to the next higher court, i.e., the High Court.The Court rejected the High Court's reasoning that allowing the appeal would amount to an appeal under Section 378 CrPC, which requires leave. The provisions are distinct; the proviso to Section 372 was introduced to confer a substantive right to victims to appeal acquittals and is not subject to the procedural restrictions of Section 378.5. Precedential Support and Policy ConsiderationsThe Court relied on the decision in Mallikarjun Kodagali v State of Karnataka, which emphasized a liberal, progressive, and beneficial interpretation of the victim's rights under the proviso to Section 372 CrPC. The judgment highlighted the international context, referencing the UN Declaration of Basic Principles of Justice for Victims of Crime and Abuse of Power, which advocates for victims' access to justice and participation in proceedings.The Court underscored that the proviso to Section 372 CrPC was inserted to create a substantive right for victims to appeal acquittals or inadequate convictions, recognizing victims as the worst sufferers in crime who historically had limited roles in court proceedings. This legislative intent supports a broad construction of victim rights, independent of the complainant's status or the procedural limitations of other provisions.The Court also cited a recent coordinate bench decision affirming that the proviso to Section 372 CrPC creates a new right for victims to appeal acquittals or lesser convictions as a matter of right, not merely as an exception or qualification.6. Application of Law to Facts and Final ConclusionApplying the above legal framework, the Court found that the appellant suffered loss and injury due to counterfeit products infringing its intellectual property rights. It was therefore a victim under Section 2(wa) CrPC. The appellant had locus to file an appeal under the proviso to Section 372 CrPC against the acquittal order passed by the First Appellate Court.The High Court's dismissal of the appeal on maintainability grounds was held to be legally unsustainable. The Court set aside the impugned judgment and restored the appellant's appeal before the High Court for hearing on merits. The Court clarified that it was deciding only the question of law regarding maintainability and that the respondent would be free to raise all factual and legal defenses in the appeal.Significant Holdings'Section 2(wa) of the CrPC defines 'victim' in plain and simple language as a 'person who has suffered any loss or injury caused by reason of the act or omission for which the accused person has been charged...'. It is clear that Section 2(wa) of the CrPC has thoughtfully accorded an expansive understanding to the term 'victim' and not a narrow or restricted meaning.''Section 372 of the CrPC is a self-contained and independent Section; in other words, it is a stand-alone Section. Section 372 of the CrPC is not regulated by other provisions of Chapter XXIX of the CrPC. The proviso to Section 372 of the CrPC operates independently of and shall not be read conjointly with any other provision in the CrPC, much less Section 378 of the CrPC.''The proviso to Section 372 of the CrPC is agnostic to the factum of such acquittal being by the Trial Court or the First Appellate Court. We can see the situation through another lens also. In the facts at hand, acquittal was by the First Appellate Court (being a Sessions Court), in law, the right of appeal by the victim would be to the next higher level in the judicial hierarchy, which would be the High Court.''A victim as defined in Section 2(wa) CrPC would be entitled to file an appeal before the Court to which an appeal ordinarily lies against the order of conviction. It must follow from this that the appeal filed by Kodagali before the High Court was maintainable and ought to have been considered on its own merits.''The proviso to Section 372 CrPC is a substantive enactment, and is not merely excepting something out of or qualifying what was excepting or goes before. Therefore, by adding the 'proviso' in Section 372 of CrPC by this amendment, a right has been created in favour of the victim.''The finding of the High Court that the Appellant could not have maintained the appeal before it would amount to completely negating the proviso to Section 372 of the CrPC.''The appeal under the proviso to Section 372 CrPC is maintainable and is restored to its original file and number before the High Court.'