TaxTMI 
TaxTMI 
2025 (9) TMI 187
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....Section 482 of Code of Criminal Procedure, 1973 (For short "CrPC") came to be rejected. 3. By way of the said petition, the appellants had challenged the order dated 29th September, 2008 passed by the Judicial Magistrate First Class (Hereinafter being referred to as the "Magistrate"), Bhiwandi in Complaint No. 6353 of 2007, wherein the Magistrate had issued process against the appellants for the offences punishable under Section 500 and 501 of the Indian Penal Code, 1860 (For short "IPC"). Brief Facts: - 4. At the relevant time, the appellant Dr. Anil Khandelwal was serving as the Chairman and Managing Director of the Bank of Baroda (Hereinafter being referred to as the "Bank"), whereas the appellants B.M. Sharma and Mukul Ranjan held the positions of Deputy General Manager and Chief Manager (BCMS) in the Bank, respectively. 5. The respondent No.1-Phoenix India (Hereinafter being referred to as the "firm") had taken credit facilities from the Bank to the tune of Rs. 21.34 crores and had secured the same by mortgage of its immovable properties. 6. The loan transactions pertain to a period prior to 2002. Respondent No. 1-firm defaulted in payment of the instalments of ....
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....ly, 2007 to the appellants herein, namely the Chairman and Managing Director, the Deputy General Manager, and the Chief Manager of the Bank, alleging defamation on the ground that the Bank had maliciously issued the possession notices reflecting an unrealistic and false outstanding amount of more than Rs. 50 crores. 9. The Bank, in response, promptly issued a clarificatory letter dated 7th August, 2007 expressing regret for the clerical error that occurred in mentioning the amount in the possession notice pasted on the premises of respondent No. 1-firm. 10. Respondent No. 1-firm, however, was not satisfied by the clarification letter and filed a criminal Complaint No. 6353 of 2007 before the Magistrate, Bhiwandi for the offences under Sections 499, 500 and 501 of the IPC alleging inter-alia that, by raising the aforesaid exaggerated demand and pasting the possession notice on the premises of respondent No. 1-firm with fictitious outstanding amount, the Bank and its officials had defamed respondent No. 1-firm (complainant) thereby harming its reputation and future business prospects. 11. The Magistrate proceeded on the complaint and issued process against the appellan....
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....when the company itself is arraigned as an accused and additionally, the directors or officers must have acted in a manner that directly connects his/her conduct to the company's liability. In the absence of the company being impleaded as an accused, its directors or officers cannot be fastened with vicarious liability for offences attributable to the company. 18. Thus, the prosecution of the appellants, without impleading the Bank as an accused in the proceedings, is ex-facie impermissible and cannot be sustained. 19. We may further observe that the learned Magistrate as well as the High Court have assumed that the appellants herein were responsible for the day-to-day affairs of the Bank and thereby the process of issuance of the so-called defamatory notice can be attributed to the appellants. 20. Suffice it to say that the appellants have been summoned in capacity of the officers of the Bank for the offences punishable under the IPC. However, there is no concept of vicarious liability of the officers or directors for the offences under the IPC as is provided under special Penal Statutes such as The Negotiable Instruments Act, 1881, The Food Safety and Standards Act, 2006....
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....be an instrument of oppression or needless harassment. The complaint was laid impleading the Chairman, the Managing Director of the Bank by name and a host of officers. There lies responsibility and duty on the Magistracy to find whether the concerned accused should be legally responsible for the offence charged for. Only on satisfying that the law casts liability or creates offence against the juristic person or the persons impleaded then only process would be issued. At that stage the court would be circumspect and judicious in exercising discretion and should take all the relevant facts and circumstances into consideration before issuing process lest it would be an instrument in the hands of the private complaint as vendetta to harass the persons needlessly. Vindication of majesty of justice and maintenance of law and order in the society are the prime objects of criminal justice but it would not be the means to wreak personal vengeance. Considered from any angle we find that the respondent had abused the process and laid complaint against all the appellants without any prima facie case to harass them for vendetta." (Emphasis Supplied) 24. Hence, in the absence of any spec....