TaxTMI 
TaxTMI 
2016 (12) TMI 1821
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....ct, 2000 (for short, "the IT Act") against all of them. Avnish Bajaj filed Criminal Misc. Case No. 3066 of 2006 for quashment of the proceedings on many a ground before the High Court of Delhi which vide order dated 29.05.2008 came to the conclusion that prima facie case was made out Under Section 292 Indian Penal Code, but it expressed the opinion that Avinish Bajaj, the Petitioner in the said case, was not liable to be proceeded Under Section 292 Indian Penal Code and, accordingly, he was discharged of the offence Under Sections 292 and 294 Indian Penal Code. However, he was prima facie found to have committed offence Under Section 67 read with Section 85 of the IT Act and the trial court was directed to proceed to the next stage of passing of order of charge uninfluenced by the observations made in the order of the High Court. 3. Being grieved by the aforesaid order, Avnish Bajaj preferred Criminal Appeal No. 1483 of 2009. The said appeal was tagged with Ebay India Pvt. Ltd. v. State and Anr. (Criminal Appeal No. 1484 of 2009). The said appeals were heard along with other appeals that arose from the lis relating to interpretation of Sections 138 and 141 of the Negotiable Instru....
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....ncerned, the Court referred to Section 85 of the IT Act which is as follows: 85. Offences by companies.--(1) Where a person committing a contravention of any of the provisions of this Act or of any rule, direction or order made thereunder is a company, every person who, at the time the contravention was committed, was in charge of, and was responsible to, the company for the conduct of business of the company as well as the company, shall be guilty of the contravention and shall be liable to be proceeded against and punished accordingly: Provided that nothing contained in this Sub-section shall render any such person liable to punishment if he proves that the contravention took place without his knowledge or that he exercised all due diligence to prevent such contravention. (2) Notwithstanding anything contained in Sub-section (1), where a contravention of any of the provisions of this Act or of any rule, direction or order made thereunder has been committed by a company and it is proved that the contravention has taken place with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, s....
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....be proceeded Under Section 292 Indian Penal Code. 11. Be it noted, on the first date of hearing, Dr. A.M. Singhvi, learned senior Counsel appearing for the Appellant urged that the dispute raised require interpretation of various provisions of the IT Act and bearing that in mind, the Court thought it appropriate to hear the learned Attorney General for the Union of India. In the course of hearing, the Court was assisted by Mr. Mukul Rohatgi, learned Attorney General for India, Mr. Ranjit Kumar, learned Solicitor General and Mr. R.K. Rathore, learned Counsel for the Union of India. 12. It is not disputed that the Appellant is the senior manager of the intermediary and the managing director of the intermediary has been discharged of all the offences as per the decision in Aneeta Hada (supra) and further that singular charge that has been framed against the Appellant is in respect of Section 292 Indian Penal Code. It is submitted by Dr. Singhvi that the Appellant could not have been proceeded Under Section 292 Indian Penal Code after having been discharged Under Section 67 of the IT Act. Mr. Rohatgi, learned Attorney General assisting the Court submitted that Section 67 of the IT Ac....
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....atsoever, or (b) imports, exports or conveys any obscene object for any of the purposes aforesaid, or knowing or having reason to believe that such object will be sold, let to hire, distributed or publicly exhibited or in any manner put into circulation, or (c) takes part in or receives profits from any business in the course of which he knows or has reason to believe that any such obscene objects are for any of the purposes aforesaid, made, produced, purchased, kept, imported, exported, conveyed, publicly exhibited or in any manner put into circulation, or (d) advertises or makes known by any means whatsoever that any person is engaged or is ready to engage in any act which is an offence under this section, or that any such obscene object can be procured from or through any person, or (e) offers or attempts to do any act which is an offence under this section, shall be punished with imprisonment of either description for a term which may extend to three months, or with fine, or with both. Exception.--This Section does not extend to any book, pamphlet, paper, writing, drawing or painting kept or used bona fide for religious purposes or any representation sculptured, eng....
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....ity depends as much upon the mores of the people as upon the individual. It is always a question of degree or as the lawyers are accustomed to say, of where the line is to be drawn. It is, however, clear that obscenity by itself has extremely "poor value in the-propagation of ideas, opinions and information of public interest or profit." When there is propagation of ideas, opinions and information of public interest or profit, the approach to the problem may become different because then the interest of society may tilt the scales in favour of free speech and expression. It is thus that books on medical science with intimate illustrations and photographs, though in a sense immodest, are not considered to be obscene but the same illustrations and photographs collected in book form without the medical text would certainly be considered to be obscene. Section 292, Indian Penal Code deals with obscenity in this sense and cannot thus be said to be invalid in view of the second Clause of Article 19. 16. Eventually, the Court upheld the constitutional validity of the said provision. After the pronouncement by the Constitution Bench, the legislature amended Section 292 which presently rea....
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....the ground that such book, pamphlet, paper, writing, drawing, painting, representation or figure is in the interest of science, literature, art or learning or other objects of general concern, or (ii) which is kept or used bona fide for religious purposes; (b) any representation sculptured, engraved, painted or otherwise represented on or in-- (i) any ancient monument within the meaning of the Ancient Monuments and Archaeological Sites and Remains Act, 1958 (24 of 1958), or (ii) any temple, or on any car used for the conveyance of idols, or kept or used for any religious purpose. 17. At the outset, we may clarify that though learned Counsel for the Appellant has commended us to certain authorities with regard to role of the Appellant, the concept of possession and how the possession is not covered Under Section 292 Indian Penal Code, we are not disposed to enter into the said arenas. We shall only restrict to the interpretative aspect as already stated. To appreciate the said facet, it is essential to understand certain provisions that find place in the IT Act and how the Court has understood the same. That apart, it is really to be seen whether an activity emanating from ....
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....onable restrictions that may be imposed on such right. 20. Thereafter the Court referred to Kameshwar Prasad vs. State of Bihar 1962 Supp. (3) SCR 369 : AIR 1962 SC 1166 and Central Prison v. Ram Manohar Lohia AIR 1960 SC 633 and came to hold as follows: 94. These two Constitution Bench decisions bind us and would apply directly on Section 66-A. We, therefore, hold that the Section is unconstitutional also on the ground that it takes within its sweep protected speech and speech that is innocent in nature and is liable therefore to be used in such a way as to have a chilling effect on free speech and would, therefore, have to be struck down on the ground of overbreadth. 21. While dealing with obscenity, the Curt referred to Ranjit D. Udeshi (supra) and other decisions and opined thus: 48. This Court in Ranjit D. Udeshi v. State of Maharashtra (supra) took a rather restrictive view of what would pass muster as not being obscene. The Court followed the test laid down in the old English judgment in R. v. Hicklin (1868) LR 3 QB 360 which was whether the tendency of the matter charged as obscene is to deprave and corrupt those whose minds are open to such immoral influences and int....
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....text. We only opine that view of the High Court pertaining to the framing of charge Under Section 292 Indian Penal Code cannot be flawed. 23. Reference to Shreya Singhal (supra) is only to show that in the said case the Court while dealing with constitutional validity of Section 66-A of the IT Act noticed that the said provision conspicuously did not have the word "obscene". It did not say anything else in that regard. In the case at hand, it is required to be seen in which of the provision or both an accused is required to be tried. We have already reproduced Section 292 Indian Penal Code in the present incarnation. Section 67 of the IT Act which provides for punishment for publishing or transmitting obscene material in electronic form reads as follows: 67. Punishment for publishing or transmitting obscene material in electronic form.-Whoever publishes or transmits or causes to be published or transmitted in the electronic form, any material which is lascivious or appeals to the prurient interest or if its effect is such as to tend to deprave and corrupt persons who are likely, having regard to all relevant circumstances, to read, see or hear the matter contained or embodied in....
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....of general concern; or (ii) which is kept or used for bona fide heritage or religious purposes. Explanation.-For the purpose of this Section "children" means a person who has not completed the age of 18 years. 25. Section 69 of the IT Act provides for power to issue directions for interception or monitoring or decryption of any information through any computer resource. It also carries a penal facet inasmuch as it states that the subscriber or intermediary who fails to comply with the directions issued under Sub-section (3) shall be punished with imprisonment for a term which may extend to seven years and shall also be liable to fine. 26. We have referred to all these provisions of the IT Act only to lay stress that the legislature has deliberately used the words "electronic form". Dr. Singhvi has brought to our notice Section 79 of the IT Act that occurs in Chapter XII dealing with intermediaries not to be liable in certain cases. Learned Counsel has also relied on Shreya Singhal (supra) as to how the Court has dealt with the challenge to Section 79 of the IT Act. The Court has associated the said provision with exemption and Section 69A and in that context, expressed that: ....
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....if the entire allegations are accepted. According to him, once the factum of electronic record is admitted, Section 79 of the IT Act must apply ipso facto and ipso jure. Learned senior Counsel has urged Section 79, as the language would suggest and keeping in view the paradigm of internet world where service providers of platforms do not control and indeed cannot control the acts/omissions of primary, secondary and tertiary users of such internet platforms, protects the intermediary till he has the actual knowledge. He would contend that Act has created a separate and distinct category called 'originator' in terms of Section 2(1)(z)(a) under the IT Act to which the protection Under Section 79 of the IT Act has been consciously not extended. Relying on the decision in Shreya Singhal (supra), he has urged that the horizon has been expanded and the effect of Section 79 of the IT Act provides protection to the individual since the provision has been read down emphasizing on the conception of actual knowledge. Relying on the said provision, it is further canvassed by him that Section 79 of the IT Act gets automatically attracted to electronic forms of publication and transmissio....
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....nce) Act, 1956 which laid down that the provisions of the said Act and the Rules made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any other law. The Delhi Rent Control Act, 1958 also contained non-obstante clauses. Interpreting the same, the Court held: When two or more laws operate in the same field and each contains a non-obstante Clause stating that its provisions will override those of any other law, stimulating and incisive problems of interpretation arise. Since statutory interpretation has no conventional protocol, cases of such conflict have to be decided in reference to the object and purpose of the laws under consideration. A piquant situation, like the one before us, arose in Shri Ram Narain v. Simla Banking & Industrial Co. Ltd. AIR 1956 SC 614 the competing statutes being the Banking Companies Act, 1949 as amended by Act 52 of 1953, and the Displaced Persons (Debts Adjustment) Act, 1951. Section 45-A of the Banking Companies Act, which was introduced by the amending Act of 1953, and Section 3 of the Displaced Persons Act, 1951 contained each a non-obstante clause, providing that certain provisions would have effect "notwi....
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....sions in these two Acts, in a given case, on much broader considerations of the purpose and policy underlying the two Acts and the clear intendment conveyed by the language of the relevant provisions therein. 31. In Solidaire India Ltd. v. Fairgrowth Financial Services Ltd. (2001) 3 SCC 71, this Court while dealing with two special statutes, namely, Section 13 of Special Court (Trial of Offences Relating to Transactions in Securities) Act, 1992 and Section 32 of Sick Industrial Companies (Special Provisions) Act, 1985, observed as follows: Where there are two special statutes which contain non obstante clauses the later statute must prevail. This is because at the time of enactment of the later statute, the Legislature was aware of the earlier legislation and its non obstante clause. If the Legislature still confers the later enactment with a non obstante Clause it means that the Legislature wanted that enactment to prevail. If the Legislature does not want the later enactment to prevail then it could and would provide in the later enactment that the provisions of the earlier enactment continue to apply. 32. The aforesaid passage clearly shows that if legislative intendment is ....