Sol Pharmaceuticals Limited Through Its Chairman and Managing Director C. Chandrashekhra Reddy, Hyderabad v Dr. Jaswant Dilipsing Patil and another

Bombay High Court

AURANGABAD BENCH

13 June 2013

Criminal W.P. No. 378 of 2002

The Order of the Court was as follows :

1. The petitioner-company has questioned order dated 3.6.2003 passed by learned Judicial Magistrate, First Class, Jalgaon in Criminal Case No.739/2002, whereby the learned trial Magistrate, upon prima facie satisfaction from the case record decided to take cognizance of offence punishable u/s. 420 of Indian Penal Codeand issued process against the petitioner-company.

2. It is the contention on behalf of the petitioner-company that the ingredients of the offence of cheating, as defined u/s. 415 of the Indian Penal Code were not made out and the deposits accepted by the company under the scheme although by cash bond was subject to Hyderabad jurisdiction only. The scheme was floated by the company under which the investment in the bond was for Rs. 12,500/- with maturity amount of Rs.15,500/- after period of eighteen months. The advertisement was approved by the Board of Directors on 14.6.1996 and accordingly, deposits were accepted. The respondent-complainant lodged complaint when he could not receive the maturity amount despite his investment in the sum of Rs.25,000/- for two such bonds. Thus, alleging that offence punishable u/s. 420 read with sec.34 of Indian Penal Code was committed on behalf of the petitioner-company. It is also submitted that the petitioner-company is provided with rehabilitation package, in view of the provision under Sick Industrial Companies (Special Provisions) Act, 1985 as no proceedings against assets of the company shall lie. Learned Advocate on behalf of the petitioner, therefore, submitted that at the most there may be liability for breach of contract, but no offence of cheating was committed on behalf of the petitioner- company, punishable u/s. 420 of Indian Penal Code.

3. Learned Advocate for the petitioner, to support her submission made a reference to ruling in Hridaya Ranjan Pd.Verma vs. State of Bihar, reported in 2000 AIR (SC) 2341 2000 Indlaw SC 248 to argue that mere breach of contract would not amount to an offence punishable u/s. 420 of Indian Penal Code, as it would be only a breach of civil contract and no fraudulent or dishonest intention is involved. Learned Advocate for the petitioner, therefore, prayed for quashing of issue of process and the proceedings pending against the petitioner- company. Reference is also made to Pepsi Foods Vs. Special Judicial Magistrate, reported in 1997 AIR (SC) 4084 1997 Indlaw SC 290 in order to argue that when preliminary evidence do not make out a case against the accused, it would be amount to abuse of process of law and further that the provisions of S. 482 of Cr.P.C. and Art. 227 and 226 of the Constitution of India are devised to advance justice and not to frustrate it.

4. Learned Advocate on behalf of the respondent opposed submissions advanced in support of the petition contending that there is no bar for learned Judicial Magistrate, First Class, Jalgaon to entertain the complaint, as according to him, a civil suit to recover amount may lie at Hyderabad in terms of the bond entered into by the company.

However, when complaint is made in respect of an offence punishable u/s. 420 of Indian Penal Code of Indian Penal Code, learned Judicial Magistrate, First Class had entertained the complaint and taken cognizance of offence because the offence was committed partly in Jalgaon, as the bond was received by the complainant in Jalgaon. U/s. 178 of the Code of Criminal Procedure, considering that the offence which may occur partly in one area and partly in another area or which consists of several acts done in respect of different areas, the Court having jurisdiction over any of such local areas may inquire into and try the complaint case. Learned Advocate for the respondent also made reference to S. 182 of Code of Criminal Procedure to argue that any offence, which includes cheating may, if the deception is practised by means of letters or telecommunication messages, be inquired into or tried by any Court within whose local jurisdiction such letters or messages (in the present case bond) were sent or were received.

Thus, he submitted that there was no legal bar for learned trial Magistrate to entertain an inquiry or the complaint. Regarding the ingredients made out in respect of the offence of cheating, learned Advocate for the respondent brought to my notice the averments in the complaint to specific effect that accused had fraudulent intention to cheat and to defraud the complainant right from the beginning, as stated in para 2 of the complaint. Regarding alleged sickness of the petitioner- company, it is submitted that the complaint is in respect of offence of cheating and not to recover any asset of the company. Thus, meeting the contentions advanced in support of the petition, learned Advocate for the respondent submitted that no interference be made in the matter of issuance of process against the petitioner-company.

5. Considering the above submissions, as also averments in the complaint, it does appear that learned trial Magistrate had recorded his prima facie satisfaction about the case made out against the accused No.1 (present petitioner-company), while he decided to take cognizance of offence punishable u/s. 420 of Indian Penal Code against the petitioner-company. Under these circumstances, the prosecution which has started against the petitioner-company can be taken to its logical end in accordance with law and by trial on merits by learned trial Magistrate at Jalgaon.

Therefore, in the facts and circumstances stated before me, no legal ground is made out for interfering with the impugned order of issuance of process.

Hence, writ petition is dismissed. Interim relief vacated. Rule discharged.

Petition dismissed

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