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Legal Remembrancer of Govt. of West Bengal Vs. Haridas Mundra - Court Judgment

LegalCrystal Citation
SubjectCriminal
CourtSupreme Court of India
Decided On
Case NumberCriminal Appeal Nos. 115 of 1971 and 256 and 257 of 1971
Judge
Reported inAIR1976SC2225; 1976CriLJ1732; (1976)1SCC555; [1976]2SCR933; 1976(8)LC133(SC)
ActsIndian Penal Code (IPC) - Sections 120B, 409, 418, 463, 468, 471, 475, 476 and 477-A; Code of Criminal Procedure (CrPC) , 1898 - Sections 195(1), 476 and 476-A
AppellantLegal Remembrancer of Govt. of West Bengal;state of West Bengal
RespondentHaridas Mundra;haridas Mundra
Appellant Advocate D. Mookherjee and; M.N. Shroff, Adv
Respondent Advocate V.S. Desai, ; A.G. Menseses, Advs. and ; J. B. Dadchanji an
Cases Referred and Mohan Lal v. The State of Rajasthan
Prior historyAppeal by special leave from the Judgment and Order dated June 16, 1970 of the Calcutta High Court in Criminal Revision Case No. 650 of 1967 and From the Judgments and Orders dated April 27, 1967 and January 28, 1971 of the Calcutta High Court in Cases No
Excerpt:
.....under sections 471, 475 or 476 - in case in question respondent was being tried for three distinct offences - offences under sections 418 and 477a were not covered by section 195 (1) (c) - so far as offence under section 471 concerned requirement of section 195 (1) that document in question should be produced or given in evidence in proceeding was not satisfied - high court entitled to proceed with trial of respondent - impugned order set aside - appeal allowed. - haryan urban development authority act (13 of 1977) section 17: [s.b.sinha & dr.mukundakam sharma,jj] allotment of plot appellant did not send any letter of acceptance - non-payment of amount stipulated in letter of allotment within specified time - cancellation of allotment in accordance with terms of allotment letter ..........could be said to be vitiated on the ground that no complaint in writing was made by the company judge. the high court had, therefore, clearly and indubitably jurisdiction to proceed with the trial against the respondent in respect of the offence under sections 418 and 477a. the question of lack of jurisdiction in the high court to proceed with the trial could arise only in regard to the offence under section 471 which is one of the offence specified in section 195(1)(c). but in regard to this offence also, we do not see how, on the facts of the present case, the applicability of section 195(1)(c) could be invoked on behalf of the respondent. the offence under section 471 which was charged against the respondent was that he had used the two forged bills of indian machine tools co, as.....
Judgment:

P.N. Bhagwati, J.

1. These three appeals arise out of the same facts and it would, therefore, be convenient to dispose of them by a common judgment. The respondent in all the three appeals is one Haridas Mundra. He was at all material time the managing director of Section B. Industrial Development Co. (Private) Limited, who were the managing agents of a company called Richardson & Cruddas Ltd. He had his brother Tulsidas Mundra were also directors of Richardson & Cruddas Ltd. The Life Insurance Corporation of India, Which was the largest share-holder, filed a petition in the High Court of Calcutta being Matter No, 357 of 1957 seeking relief against mismanagement of Richardson & Cruddas Ltd under Sections 397 and 398 of the Companies Act, 1956. The respondent and other directors were impleaded as party-respondents to the petition. The High Court, on the application of the Life Insurance Coporation, made an interim order sometime in December 1957 appointing Sir Dhirendra Mitra as special Officer to manage the affairs of Richardson & Cruddas Ltd. There was an audit report made by M/s. Gutgutia & Co., Chartered Accountants, in regard to the accounts of Richardson & Cruddas Ltd., but the special Officer was not satisfied with this report and he, therefore, after obtaining directions from the Company Judge, appointed M/s. Ferguson & Co., a reputed firm of Chartered Accountants, to examined the accounts of the Company and submit their report. Ferguson & Co. found, as a result of their investigation, that there were two bills in the records of the company, one for Rs. 4,12,000/- dated 20th June, 1955 and the other for Rs. 6,48 900/- dated 27th June, 1955 purporting to be issued by a firm called Indian Machine Tools Co having its address at 7, Mission Row, Calcutta, showing purchase of certain machinery by Richardson & Cruddas Ltd. from Indian Machine Tools. Co. and on the strength of these two bills, entries were made in the books of account Richardson & Cruddas Ltd. on 24th June, 1955 in respect of the first bill and on 29th June, 1955 in respect of the second bill, crediting the amounts of the bills to Section B. Industrial Development Co. (Pvt.) Ltd. and debiting to the machinery account. On making inquiries, Ferguson & Co discovered that there was no firm of Indian Machine Tools Co. in existence at 7, Mission Row, Calcutta and no machinery was in fact purchased or received by Richardson & Cruddas Ltd. as shown in the two bills supposed to have been made out by Indian Machine Tools. Co. The conclusion reached by Ferguson & Co. as a result of this probe was that Richardson & Cruddas Ltd. had been defrauded of an aggregate sum of Rs. 10,60,900/- representing the amounts of the two bills and that amount had been siphoned off to S B. Industrial Development Co. (Pvt) Ltd. by using these two bills, which were forged, as genuine and they made a report to this effect to the Special Officer. The Special Officer, on receipt of the report, made an application to the Company Judge for a direction that he might be authorised to lodge a complaint with the police for further investigation into these facts set but in' the report. The company Judge gave the necessary direction and the Special Officer there-upon moved the police for making further-investigation in the matter. The Special Police Establishment started the investigation and ultimately submitted a charge sheet against the respondent and Tulsidas Mundra in the Court of the Chief Presidency Magistrate. The respondent and Tulsidas Mundra were committed by the Chief Presidency Magistrate to stand their trial before the High Court on charges under Sections 120B, and 409 of the Indian Penal Code against Tulsidas Mundra, when the trial commenced before the High Court, the public Prosecutor made two applications on 17th April, 1967, one for amending the charges against the respondent by dropping Sections 120 and 409 and adding Section 418 and the other for with drawing the prosecution against Tulsidas Mundra. Both these applications were allowed by the High Court, with the result that the trial proceeded only against the respondent on charges under Sections 418, 471 read with Section 468 and Section 477A. Mr. Justice Bagchi, before whom the trial proceeded, felt that he had no jurisdiction to proceed with the trial in view of Section 195(1)(c) of the CrPC 1898 and he therefore, requested the public Prosecutor as well as the counsel for the respondent to argue the point as to the applicability of that section The learned Judge, after hearing the arguments advanced before him on both sides, delivered an elaborate judgment that by reason of Section 195(1)(c) of the CrPC 1898, which applied in the present case, he had no jurisdiction to proceed further with the trial of the respondent and he accordingly discharged the respondent by an order dated 27th April, 1967.

2. The State being aggrieved by this judgment and order passed by Mr. Justice Bagchi in the exercise of original criminal jurisdiction, preferred a revision application against the same on the appellate side of the High Court. The respondent raised a preliminary objection against the maintainability of the revision application on the ground that it was not competent to the High Court to exercise revision jurisdiction against an order made by a judge of the High Court in Sessions trial. Since this preliminary objection raised a question of some importance, it was referred lo a full Bench and by a judgment dated 16th June, 1970, the Full Bench upheld the preliminary objection and held that the High Court had no jurisdiction in revision to interfere with any judgment, order or sentence passed by a judge of the High Court in the exercise of its original criminal jurisdiction and accordingly rejected the revision application.

3. It appears that the State had in the machine filed an application in the High Court for leave to appeal to this Court against the judgment and order of Mr. Justice Bagchi. This application was rejected by the learned Judge by an order dated 28th January, 1971 on the ground that it was not a judgment or a final order or a sentence falling, within Article 134(1)(c) of the Constitution. The State thereupon preferred two petitions in this Court for special leave to appeal, one against the judgment and order of Mr. Justice Bagchi discharging the respondent and the other against the judgment and order of the same learned Judge rejecting the application of the State for leave to appeal to this Court. this Court allowed both the petitioner and granted special leave and hence we have criminal Appeal No. 256 of 1971 directed against the judgment and order Mr. Justice Bagchi discharging the respondent and Criminal Appeal No. 257 of 1971 against the judgment and order of that learned judge refusing leave to appeal to the State. The State also preferred an application in the High Court for leave to appeal to this Court against the judgment and order of the Full Bench rejecting the revisional application of the State and on this application, leave was granted by the High Court under Article 134(1)(c) of the Constitution and that in how Cr. A. No. 115 of 1971 is before us.

4. We will first deal with Criminal Appeal No. 256 of 1971. If that criminal appeal is allowed and it is held that Section 195(1)(c) has no applicability in the present case, it would become unnecessary to consider the other two criminal appeals Now, Section 195(1)(c) provides that no court shall take cognisance of an offence described in Section 403 or punishable under Sections 471, 475 and 476 of the Indian Penal Code where such offence is alleged to have been, committed by a party to any proceeding in any court in respect of any document produced or given in evidence in such proceeding, except on the complaint in writing of such court or of some other court to which such court is subordinate. Obviously, on its plain language, the inhibition in Section 195(1)(c) applies only where a person is being tried for an offence described in Section 463 or punishable under Sections 471 or Section 476. Mere, the respondent was being tried for three distinct offence under Sections 418, 471 and 477A. So for as the offence under Sections 418 and 477A are concerned, they were plainly not covered by Section 195(1)(c) and even if Section 195(1)(c) were otherwise applicable, it is difficult to see how the trial of the respondent of or these two offence could be said to be vitiated on the ground that no complaint in writing was made by the Company Judge. The High Court had, therefore, clearly and indubitably jurisdiction to proceed with the trial against the respondent in respect of the offence under Sections 418 and 477A. The question of lack of jurisdiction in the High Court to proceed with the trial could arise only in regard to the offence under Section 471 which is one of the offence specified in Section 195(1)(c). But in regard to this offence also, we do not see how, on the facts of the present case, the applicability of Section 195(1)(c) could be invoked on behalf of the respondent. The offence under Section 471 which was charged against the respondent was that he had used the two forged bills of Indian Machine Tools Co, as genuine on 24th and 29th June, 1955 by making, on the strength of these; two bills, false entries in the books of account of Richardson & Cruddas Ltd. crediting the aggregate sum of Rs. 10,60,900/- in the account of S.B Industrial Development Co. (Pvt.) Ltd. and debiting it in the machinary account. This offence was alleged to have been committed by the respondent on 24th and 29th June, 1955 long before the proceeding in Matter No. 357 of 1957 commenced and he became a party to that proceeding and it was not committed by him in his capacity as such party, that is after having become a party to the proceeding Now, at one time there was sharp cleavage of opinion, amongst various High Courts in regard to the true interpretation of Section 195(1)(c). Some High Courts held that to attract the prohibition contained in Section 195(1)(c), the offence should be alleged to have been Committed by the party to the proceeding in his character as such party, which means, after having become a party to the proceeding, while some others took the view that it was sufficient to attract the applicability of Section 195(1)(c) even if the alleged offence was committed by the party to the proceeding prior to his becoming such party, provided that the document in question was produced or given in evidence in such proceeding This divergence of opinion amongst different High Courts was set at rest by this Court by its decision in Patel Lalji-bhai Somabhai v. The Stale of Gujarat (1) where this Court accepted the former view in preference to the latter. this Court pointed out that the words of Section 195(1)(c) clearly meant that the offence should be alleged to have been committed by the party to the proceeding, in his character as such party, that is, after having become a party to the proceeding. Sections 195(1)(c), 476 and 476A read together indicated beyond doubt that the legislature could not have intended to extend the prohibition contained in Section 195(1)(c) to the offence mentioned therein when committed by a party to a proceeding prior to his becoming such party. The scope and ambit of Section 195(1)(c) was thus restricted by this Court to cases where the offence was alleged to have been committed by a party to a proceeding after he became such party and not before. This view as to the interpretation of Section 195(1)(c) was reaffirmed by this Court in Raghunath v. State of U.P. (2) and Mohan Lal v. The State of Rajasthan (3). It must inevitably follow, on this view, that since the off nee charged against the respondent was one alleged to have been committed by him before he became a party of the proceeding in Matter No. 357 of 1957, Section 195(1)(c) had no application. It may also be noted that neither of the two forged bills of Indian Machine Tools Co. was produced or given in evidence in the proceeding in Matter No 357 of 1957 Both these forged bills formed part of the record of Richardson & Cruddas Ltd. and they were taken possession of by the Special Officer along with the other record of the Company and no body produced them or tendered them in evidence before the company Judge in the proceeding in Matter No. 357 of 1957. The requirement of Section 195(1)(c) that the document in question should be produced or given in evidence in the proceeding was, therefore, clearly not satisfied and on this ground also, Section 195(1)(c) was not attracted in the present case. We must, therefore, hold that the High Court was entitled to proceed with the trial of the respondent in respect of the offence under Section 471 without any complaint in writing from the Company Judge before whom the proceeding in Matter No. 357 of 1957 was pending.

5. We accordingly allow Criminal Appeal No. 256 of 1971, set aside' the judgment of Mr. Justice Bagehi discharging the respondent and remand the case to the City Sessions Court, to which the original criminal jurisdiction in Sessions case has now been transferred, for disposal according to law. Since the case is a very old one, we would direct the city Sessions Court to take it up for hearing at an early date. On the view taken by us in Criminal Appeal No. 256 of 1971, Criminal Appeals Nos. 115 and 257 of 1971 do not survive for consideration and we accordingly dismiss them.


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