TaxTMI 
TaxTMI 
2009 (4) TMI 916
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....to the petitioner. 2. The petitioner claims to be an ordinary director of the Intergroup C & E Ltd. ('ICE Ltd' for brevity) which was allotted six Integrated Services Digital Network telephone connection ('ISDN connections' for brevity) at their office premises E-380, Greater Kailash I, New Delhi in February, 2000 without STD/ISD dialing facility. On 3rd May, 2000, the Mahanagar Telephone Nigam Ltd. (MTNL for brevity) which was a service provider for these connections filed a criminal complaint before the Special Cell of the Delhi police alleging that the subscriber was misusing the telephone connection in violation of the provisions of the Indian Telegraph Act, 1885. The police raided the business premises of the company, arrested Sh. Sanjay Malviya, its managing director and Sh. Deepak Gupta, Technical Advisor and also seized all equipment attached with the telephone connection. A case bearing FIR No. 136/2000 was registered under section 420/120B of the Indian Penal Code read with Section 4/20 of the Indian Telegraph Act, 1885. 3. The allegations in the complaint were that one of the ISD and telephone lines was made into a permanent channel and thereafter b....
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.... receipt of the notice, as to whether he had previous general or special permission of the Reserve Bank of India for the transactions detailed in the notice. The petitioner was also notified that if he failed to furnish the requisite information within the specified time, a complaint under Section 56 of FERA, 1973 read with Section 49 (3) & (4) of the FEMA, 1999 for the alleged contravention shall be filed in a court of law. 7. The petitioner contested the allegations made in the notice by a communication dated 27th May, 2002 and submitted a detailed reply denying that he had committed any violation of FERA, 1973. Certain clarifications were also sought with regard to the allegations and violations alleged by the respondent no. 2 in their notice under reply. On 7th June, 2002, the petitioner claims to have read a newspaper report in the newspapers "English Daily" and Hindustan Times, stating that the respondent no. 2 has filed a criminal complaint against the petitioner and other accused persons for alleged violations of the provisions of FERA, 1973. 8. As per the available record, the respondent no. 2 filed criminal complaint no. 880/2001 dated 27th May, 2002 under section 5....
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....copy of the notice as well as the proof of its service upon the accused person is placed on the record of the court along with the complaint. Failure to do so as in the instant case, renders the entire action illegal. It is further asserted that the complaint also does not contain any statement as to the mode and manner of service of the complaint. For this reason, it has been contended that cognizance of the complaint has been taken and notice issued in a routine manner and without any application of mind. 12. On the other hand, Mr. P.P. Malhotra, learned Additional Solicitor General appearing for the respondent has contended that the fact that the petitioner has annexed a copy of the opportunity notice with the petition, itself evidences that he was duly served and had even filed a reply to the same. The submission of the learned ASG is that the petitioner's grievance is of insufficiency of notice which is a matter of his defence. It is contended that the petitioner would have adequate opportunity to establish the same in the trial at the pre-charge stage. It is submitted that according to the respondent, this notice was served by affixation in the presence of panchas a....
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....or order made thereunder which prohibits the doing of an act without permission, no such complaint shall be made unless the person accused of the offence has been given an opportunity of showing that he had such permission." 15. Section 61 of the statute thus sets out the statutory requirements which are mandatorily to be satisfied in order to enable a court to take cognizance of the offences under the Act. Cognizance of an offence punishable under section 56 and 57 of FERA, 1973 can be taken by a court only upon a written complaint made by the Director of Enforcement, the Central Government or the Reserve Bank of India or by a person authorised by anyone of them to make a complaint. As per the proviso to clause 2 of sub- section 2 of section 61, in case of an alleged contravention which prohibits the doing of an act without permission, no complaint shall be made without giving an opportunity to such person to show that he had such permission. Inherent in this statutory requirement would be the opportunity to a person to show that there was no requirement of such permission. 16. In an unreported decision by the Bombay High Court in Crl.A.No. 39/1952 entitled State v. B. Albuq....
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.... it observed that :- "Indeed, natural justice is a pervasive facet of secular law where a spiritual touch enlivens legislation, administration and adjudication, to make fairness a creed of life. It has many colours and shades, many forms and shapes and, save where valid law excludes, it applies when people are affected by acts of authority. It is the bone of healthy government, recognised from earliest times and not a mystic testament of judge-made law. Indeed, from the legendry days of Adam and of Kautilya's Arthasastra - the rule of law has had this stamp of natural justice, which makes it social justice. We need not go into these depths for the present except to indicate that the roots of natural justice and its foliage are noble and not newfangled. Today its application must be sustained by current legislation, case law or other extant principle, not the hoary chords of legend and history. Our jurisprudence has sanctioned its prevalence even like the Anglo-American system. Law cannot be divorced from life and so it is that the life of the law is not logic but experience. If, by the experimental test, importing the right to be heard will paralyse the process, law will ....
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....ious doctrine" that right to a fair hearing may stand excluded where the Court forms an opinion that a hearing would make no difference. Utter caution is needed before bringing the last exceptional into play. (Administrative Law, ibid, at pp. 543-544)." 22. In the pronouncement of the Apex Court reported at (1980) 4 SCC 379 S.L. Kapoor vs. Jagmohan, the court held that the notice must be given in the context of the proposed action and merely furnishing the information casually or for some other purpose would not amount to proper notice. It was held that the requirement of natural justice are met only if opportunity to represent is given in view of the proposed action. The demands of natural justice are not met even if the very person proceeded against has furnished the information on which the action is based, if it is furnished in a casual way or for some other purpose. 23. In this background, the opportunity which the respondents are directed to give under the proviso to clause (ii) of sub-section 2 of Section 61 is a matter which is required to be treated with utmost seriousness with which the respondents do not appear to have treated the same in the instant case. 24. T....
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....e also admittedly received the petitioner's reply on 27th May, 2002. In this background, it is apparent on that the respondent did not wait the three-day period which they had notified the petitioner with regard to filing of its reply. 30. From the factual narration set out hereinabove, it would appear that the service of the notice dated or signed on 17th May, 2002 was merely in the nature of a technical and notional compliance of the legal provisions and that the respondent had no intention of awaiting the reply of the petitioner. It is pointed out that the 26th May, 2002 was a Sunday and hence not even the working day of the respondent. The complaint was filed on Monday, the 27th May, 2002, the first working day thereafter. There is apparently force in the contention of learned counsel for the petitioner that the period of three days which did not include three working days, would certainly not be adequate for the petitioner to gather such material whereby it could justify actions and place the same before the respondents. "Opportunity" has to be adequate and meaningful opportunity whereby a person against whom the respondent is able to place such material as to support i....
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.... be read against the respondents, in the instant case as per the complaint, the respondents have themselves not treated the show cause notice as an opportunity notice. 33. So far as the objection of the petitioner that the panchnama of service of the opportunity notice has not been filed on record or that the panchas named thereto are not named as witnesses is concerned, in my view, this objection is fallacious to say the least. The petitioner does not dispute receipt of the notice, albeit only two days before the filing of the complaint. The petitioner has admittedly also sent a reply thereto. In this view of the matter, in my view, nothing turns on not naming the panchas who were witness to the pasting of the notice in the list of witnesses. 34. This now brings us to the last but most important question in the matter. The complaint was filed before the learned ACMM who took cognizance of the offences under Section 56 of FERA, 1973 and directed issuance of summons to petitioner and other accused persons for the 20th August, 2002. Serious objection has been raised by the petitioner to the effect that the learned trial court has acted without jurisdiction in taking cogni....
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....e considers the charge to be groundless, but that does not mean that the accused cannot approach the High Court under Section 482 of the Code or Article 227 of the Constitution to have the proceedings quashed against him when the complainant does not make out any case against him and still he must undergo the agony of criminal trial. Summoning of an accused in a criminal case is a serious matter. Criminal law cannot be set into motion as a matter of course. It is not that the complainant has to bring only two witnesses to support his allegations in the complaint to have the criminal law set into motion. The order of magistrate summoning the accused must reflect that he has applied his mind to the facts of the case and the law applicable." 39. The principles which govern exercise of inherent jurisdiction under section 482 of the Criminal Procedure Code are not very different from the exercise of writ jurisdiction by the High Court under Article 226 of the Constitution of India in quashing criminal proceedings. No hard and fast rule can be laid down for exercise of such powers which would be guided by the facts and circumstances of the case. In this behalf, this court laid down....
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....Section 482 of the Code of Criminal Procedure to prevent abuse of process reported at AIR 1992 SC 604 (para 108) State of Haryana vs. Ch. Bhajanlal thus :- "108. In the backdrop of the interpretation of the various relevant provisions of the Code under Chapter XIV and of the principles of law enunciated by this Court in a series of decisions relating to the exercise of the extra-ordinary power under Article 226 or the inherent powers Under Section 482 of the Code which we have extracted and reproduced above, we give the following categories of cases by way of illustration wherein such power could be exercised either to prevent abuse of the process of any Court or otherwise to secure the ends of justice, though it may not be possible to lay down any precise, clearly defined and sufficiently channelised and inflexible guidelines or rigid formulae and to give an exhaustive list of myriad kinds of cases wherein such power should be exercised: xxx 6. Where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there i....
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....76 (3) SCC 736 Smt. Nagawwa vs. Veeranna Shivalingappa Konjalgi & Ors., the Apex Court laid down the principles with regard to the scope of consideration of a Magistrate under section 200 to 204 of the Code of Criminal Procedure and the manner of exercise of jurisdiction thereunder. The binding principles were laid down by the Apex Court in para 5 of the judgment which deserve to be considered in extenso and reads thus :- " It is true that in coming to a decision as to whether a process should be issued the Magistrate can take into consideration inherent improbabilities appearing on the face of the complaint or in the evidence led by the complainant in support of the allegations but there appears to be a very thin line of demarcation between a probability of conviction of the accused and establishment of a prima facie case against him. The Magistrate has been given an undoubted discretion in the matter and the discretion has to be judicially exercised by him. Once the Magistrate has exercised his discretion it is not for the High Court, or even this Court, to substitute its own discretion for that of the Magistrate or to examine the case on merits with a view to find out whether....
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....rial court. We would again remind the high Courts of their statutory obligation not to interfere at the initial stage of framing of charge merely on hypothesis, imagination and for far fetched reasons which in law amount to interdicting the trial against the petitioner persons. Unscrupulous litigants should be discoursed culmination of the criminal cases by having resort to uncalled for and unjustified litigation under the cloak of technicalities of law." 45. Again in 2000 III AD (Cr.) SC 1 Maratt Rubber Ltd. vs. J.K. Marattuklam, the court reiterated the principles that jurisdiction under section 482 of the CrPC should be sparingly and cautiously exercised by the high court and only when the court upon consideration, comes to a conclusion that otherwise it would be a case of abuse of process of court, or that there will be a gross miscarriage of justice, the court invoke its inherent jurisdiction. The Apex Court also laid the parameters that the High Court was not entitled to look to the several documents purported to have been filed by the petitioner in several civil proceedings or to rely on some order/observations made therein. If it did so, it would be in excess of the juri....
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....ting issuance of summons, is clearly without application of mind and cannot stand in law. In the light of the well settled principles noticed hereinabove, there is no embargo from quashing the proceedings which are pending before the learned trial court. 48. Learned counsel for the petitioner has placed one more fact in support of its case. It is submitted that so far as the case arising out of FIR No.136/2004 was concerned, the learned Metropolitan Magistrate has passed an order dated 24th July, 2004 holding that there is no sufficient material on record to make out offence under Sections 420, 406, 120-B of the IPC against the petitioner and has consequently discharged the petitioner for the said offences. The petitioner has been arrayed for trial for commission of offence under Section 4 of the Indian Telegraph Act, 1885. The learned counsel has cited at length the findings of the trial court in this order which are to the following effect:- "In order to attract the provision of Section 406 IPC following ingredients have to be satisfied:- (i) that there was an entrustment of the property with the accused or the accused was having any dominion over the property, (ii) that th....
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....ex Court in AIR 1992 SC 604 State of Haryana Vs. Chaudhary Bhajanlal (Supra) and 1976 (3) SCC 736 Smt. Nagawwa vs. Veeranna Shivalingappa Konjalgi & Ors. 50. The respondents have urged at length that the petitioner must be required to undergo the trial and establish his objections as a defence to the prosecution. The present case is one where examination of a statutory prohibition is required to be undertaken. In the light of clear principles laid down by the Apex Court, such an objection has to be held to be wholly misconceived. There would be no warrant for requiring the petitioner to defend a prolonged trial, if the filing of the complaint itself is statutorily prohibited. Continuation of such proceedings against the petitioner would, therefore, be vexatious, useless, serving no purpose and defeating the ends of justice. 51. In (2001) VII SLT 439 S.W. Palantikar & Ors. v. State of Bihar & Anr., the Apex Court has held thus :- "15. In case of a complaint under Sectin 200 Cr.P.C. or IPC a Magistrate can take cognizance of the offence made out and then has to examine the complainant and his witnesses, if any, to ascertain whether a prima facie case is made out against the ....