1 cri.appln-5343-10.odt mgn IN THE HIGH COURT OF JUDICATURE AT BOMBAY APPELLATE CRIMINAL JURISDICTION CRIMINAL APPLICATION NO.5343 OF 2010 Kiran Kumar K. Khanda ..Applicant Versus The State of Maharashtra ..Respondent Shri Murtaza Najmi for applicant. Mrs. M.M. Deshmukh, APP for State. CORAM: B. H. MARLAPALLE & U. D. SALVI, JJ. RESERVED ON: 28TH JANUARY, 2011 PRONOUNCED ON: 4TH MARCH, 2011 JUDGMENT (PER B. H. MARLAPALLE,J.) On the basis of the statement recorded by Shri Pramod Shamrao Shirke, Police Constable No.030760, D.C.B., C.I.D., Mumbai, on 18th June, 2010 C.R. No.176 of 2010 came to be registered on the same day with the L.T. Marg Police Station, for the offences punishable under Section 489-A, 489-B and 489-C of 2 cri.appln-5343-10.odt I.P.C. against 3 accused namely Assabul Masakalin Shaikh, Kiran Kumar Kanhyalal Khadra and Mohammed Tonic Moh. Asidulla Shaikh. 2. The first accused i.e. Shri Assabul Masakalin Shaikh filed Criminal Appilcation No.4744 of 2010 for bail before this Court (Single Bench) and the same was allowed on 22nd October, 2010. Accused No.2 also approached this Court for bail in Criminal Application No.5343 of 2010 and relied upon the order passed in Criminal Appication No.4744 of 2010 on 22nd October, 2010 thereby releasing the accused No.1 on bail and it was prayed that by following the principle of parity the accused No.2 was also required to be granted bail. The Single Bench hearing the Criminal Application No.5343 of 2010 on 2nd December, 2010 did not agree with the view taken in the earlier order dated 22nd October, 2010 passed in Criminal Application No.4744 of 2010 and, therefore, this application was directed to be placed before the Division Bench. Subsequently pursuant to the order passed by the Hon'ble the Chief Justice this application has been assigned to us and we have heard the learned Counsel for the applicant as well as the learned A.P.P. 3 cri.appln-5343-10.odt 3. In the order dated 22nd October, 2010 passed in Criminal Application No.4744 of 2010 the reason given for releasing the accused No.1 on bail reads as under:- “.......Though charge sheet mentions offence punishable under Sections 489(a), (b), (c) read with Section 34 of the Indian Penal Code and in fact, since the only allegation is made about the possession, offence made out is for the offence punishable under Section 489(c) of the Indian Penal Code which is bailable.” 4. As per the prosecution case on 18th June, 2010 Shri Pramod Shamrao Shirke, Police Constable attached to D.C.B., C.I.D., Unit No.2, Mumbai received information at about 1.00 p.m., from the informant that some persons dealing in counterfeit notes were likely to come near the Cotton Exchange Building at Kalbadevi Road at 2.30 p.m., on the same day for distribution of counterfeit notes. He immediately passed on that information to his superior officer Shri Dinesh Ahir, Police Inspector, who arranged for the trap. The Police party headed by Shri Dinesh Ahir went near the concerned spot and the informant was also with them. At about 2.35 p.m., four persons came near the spot and the informant indicated that those were the 4 cri.appln-5343-10.odt same persons dealing in counterfeit notes and he left the spot. The police party noticed suspicious movements of these four persons and, therefore, it encircled them and caught hold of three of them. However, one of them, taking advantage of the heavy traffic, escaped and fled. Personal search of each of the three apprehended persons- the accused was taken and during the search of accused No.1-Assabul Masakalin Shaikh (resident of Kandivali East), 75 counterfeit notes of the denomination of Rs.1,000/- each were found in a transparent packet stuck to his trouser near his abdomen. During the search of accused No.2-Kiran Kumar Kanhyalal Khadra (resident of Khar West) the applicant in Criminal Application No.5343 of 2010, 75 counterfeit notes of the denomination of Rs.1,000/- each were recovered in the same manner. Similarly during the search of accused No.3- Mohammed Tonic Moh. Asidulla Shaikh, 50 counterfeit notes of the denomination of Rs.1,000/- each were found in similar circumstances.Thus the counterfeit notes in the total sum of Rs.2,00,000/- were receovered from the three accused and seized under a panchanama and thereafter C.R.No. 176/ 2010 came to be registered. During the course of investigation, the seized notes were referred to the Currency Note Press, Nashik Road and its report dated 23rd July, 2010 was received and the report concluded “The 5 cri.appln-5343-10.odt referred suspected notes of Rs.1,000/- denomination are “COUNTERFEIT NOTES” due to the above mentioned reasons and absence of other security features of relevant Rubber stamp of CNP is affixed on each note in token of examination and signed intermittently and on top and bottom note of each exhibit.” 5. On investigation the charge sheet came to be filed and the case being exclusively triable by the Sessions Court it was committed and re-registered as Sessions Case No.510 of 2010. Applications were filed for being released on bail under Section 439(1) of Cr.P.C., and they came to be rejected by the learned Additional Sessions Judge, Sewree, Mumbai. 6. The reasonsing set out by the Single Bench in Criminal Appication No.5343 of 2010 while diferring with the earlier order passed in Criminal Application No.4744 of 2010 reads as under:- “4. On perusal of the record as pointed out above, all the three accused persons were found at the place far away from their places of residence. Accused no.1 was resident of Kandivali, accused no.2 is resident of Khar (East) and accused no.3 is resident of Malad. Counterfeit notes were not found at the place of their residences or at the places of their 6 cri.appln-5343-10.odt work. If that would be so, case would be simple under Section 489-C, i.e. about possession of the counterfeit notes. However, all these three persons far away from their place of residence or work had come to Kalbadevi Road, which is commercial and trading centre of the city and as per the information they had come to the distribution of the counterfeit notes. Circumstances in which they were caught in the commercial area in the market, there is scope to draw inference that they had come for sale or distribution of counterfeit notes. Manner in which they had stuck up the bags near their abdomen under the pants indicates that they were aware that notes with them were counterfeit notes. It means that they have received counterfeit notes for the distribution or sale of the same. There is no evidence that they had counterfeited the notes, therefore, it can be inferred that they had received the counterfeit notes for selling or distributing the same. In view of these facts, in my considered opinion, case under Section 489-B is made out and offence is non-bailable. Offence of possession and particularly, offence of selling, receiving or distributing or trafficking in the counterfeit notes is serious offence against the national economy and the manner in which accused were found in possession of counterfeit notes of high denominations Rs.1,000/- each, indicates that some persons working against the national economy must be behind the counterfeiting and distribution of counterfeit notes. Of-course about that evidence is not collected.......” 7 cri.appln-5343-10.odt 7. Section 489-A to 489-C of the I.P.C. read as under:- “489-A. Counterfeiting currency-notes or bank-notes.-- Whoever counterfeits, or knowingly performs any part of the process of counterfeiting, any currency-note or bank- note, shall be punished with imprisonment for life, or with imprisonment of either description for a term which may extend to ten years, and shall also be liable to fine. Explanation.--For the purposes of this section and of sections 489-B, 489-C, 489-D and 489-E, the expression “bank-note” means a promissory note or engagement for the payment of money to bearer on demand issued by any person carrying on the business of banking in any part of the world, or issued by or under the authority of any State or Sovereign Power, and intended to be used as equivalent to, or as a substitute for money. Classification of Offence.--The offence under this section is cognizable, non-bailable, non-compoundable and triable by Court of Session. 489-B. Using as genuine, forged or counterfeit currency- notes or bank-notes.--Whoever sells to, or buys or receives 8 cri.appln-5343-10.odt from, any other person, or otherwise traffics in or uses as genuine, any forged or counterfeit currency-note or bank- note, knowing or having reason to believe the same to be forged or counterfeit, shall be punished with imprisonment for life, or with imprisonment of either description for a term which may extend to ten years, and shall also be liable to fine. Classification of Offence.--The offence under this section is cognizable, non-bailable, non-compoundable and triable by Court of Session. 489-C. Possession of forged or counterfeit currency-notes or bank-notes.--Whoever has in his possession any forged or counterfeit currency-note or bank-note, knowing or having reason to believe the same to be forged or counterfeit and intending to use the same as genuine or that it may be used as genuine, shall be punished with imprisonment of either description for a term which may extend to seven years, or with fine, or with both. Classification of Offence.--The offence under this section is cognizable, bailable, non-compoundable and triable by Court of Session.” 9 cri.appln-5343-10.odt 8. As per Section 489-A whoever counterfeits, or knowingly performs any part of the process of counterfeiting, any currency note or bank note, shall be punished with imprisonment for life or with imprisonment of either description for a term which may extend to ten years and shall also be liable to fine. As per Section 489-B whoever sells to, or buys or receives from, anhy other person, or otherwise traffics in or uses as genuine, any forged or counterfeit currency-note or bank note, knowing or having reason to believe the same to be forged or counterfeit, shall be punished with imprisonment for life or with imprisonment of either description for a term which may extend to ten years and shall also be liable to fine. Both these offences are cognizable, non-bailable, non-compoundable and triable by Court of Session. As per Section 489-C whoever has in his possession any forged or counterfeit currency-note or bank- note, knowing or having reason to believe the same to be forged or counterfeit and intending to use the same as genuine or that it may be used as genuine, shall be punished with imprisonment of either description for a term which may extend to seven years, or with fine, or with both. The offence under this Section is cognizable, bailable, non-compoundable and triable by Court of Session. 10 cri.appln-5343-10.odt 9. Under Section 489-B of I.P.C., the burden is on the prosecution to prove that at the time when the accused was passing the counterfeit notes, he knew that they were forged one and the mere possession of such notes by him does not shift the burden of the accused to prove his innocent possession of such notes. The knowledge or reason to believe that the note was forged has to be proved to fix the liability under Sections 489-B and 489-C of I.P.C. In the case of Golo Mandla Ram Rao vs. State of Jharkhand [2004 Cr.L.J. 1738 (Jhar.), the counterfeit currency notes and incriminating articles were recovered from the possession of the accused and only the counterfeit coins from the possession of the co- accused. It was held that the persons in possession of counterfeit coins were having the mensrea and were liable to be convicted under Section 489-B and 489-C of I.P.C. An offence under Section 489-B has the following essential ingredients:- (i) seelling, buying or receiving from any person or otherwise trafficing currency note or bank note; (ii) any forged or counterfeit currency note or bank note; (iii) knowing (or having reason to believe) that such note was forged or counterfeit. 11 cri.appln-5343-10.odt To bring home an offence u/s.498-B, I.P.C. (a) the prosecution is to prove that the relevant currenc y note or Bank note was forged or counterfeit; (b) that the accused sold to or received from, some person, or trafficked in, or used as genuine the aforesaid currency note or Bank note; (c) that when the accused did so he had knowledge or reason to believe about its being forged or counterfeit. In order to sustain the conviction of an accused, the prosecution has not only to prove that he had the possession of counterfeit note, having reason to believe it as such, but also to prove circumstances which lead clearly, indubitably and irresitably to his intention to use/circulate the notes in the public. Such intention can be proved by a collateral circumstance that he had palmed off such notes before, or that he was in possession of such notes in such large a number, that his possession for any other purpose was inexplicable. 10. While deciding Criminal Application No.4744 of 2010 filed by accused No.1 the Single Bench in its order dated 22nd October, 2010 noted, “....in fact, since the only allegation is made about the possession, offence made out is for the offence punishable under Section 489(c) of the Indian Penal Code which is bailable” and granted the bail, despite the fact that the chargesheet has been filed 12 cri.appln-5343-10.odt for the offrences punishable under Section 489-A, 489-B and 489-C of the I.P.C., and the accused had already been committed to the Sessions Court. The above observations have resulted, though unwittingly, in the deletion of the offences punishable under Section 489A and 489B of the I.P.C., and, therefore, it is, as if, while deciding the bail application an application for discharge under Section 227 of Cr.P.C. has been allowed, so far the charges under Sections 489-A and 489-B of the I.P.C. are concerned. This is not permissible in law. Along with the charge sheet the report received from the Currency Note Press, Nashik Road is placed before the Sessions Court and there could be no doubt that the notes seized from the possession of all the accused were counterfeit notes. In all, there were 200 notes each of the denomination of Rs.1,000/-. Accused No.3 had 50 notes, accused Nos.1 and 2 had 75 each notes on their person when they were trapped by the special team. One accused managed to flee taking advantage of heavy traffic at the spot of the incient. Accused No.1 had concealed these notes beneth his shirt and the tummy and partly inside the trouser whereas accused No.2 had concealed these notes in a plastic bag concealed around his waste. But accused No.3 had these notes in his purse kept in the rear pocket of his trouser. Such fake notes numbering 50 to 75 were 13 cri.appln-5343-10.odt seized from the accused and in the circumstances mentioned in the chargesheet and, therefore, it would be prejudging the prosecution case by noting that admittedly the prosecution case is only possession of the counterfeit notes. The intention of the accused has to be gathered from the attaining circumstances and the prosecution must be allowed to prove its case that it was not merely possession of the counterfeit notes, but it was a case of counterfeit notes received brought from and/or the accused were intending to traffic or use these notes as genuine notes. 11. The Single Bench in the referal order has rightly noted down that accused No.1 is the resident of Kandivali, accused No.2 is the resident of Khar (East) and accused No.3 is the resident of Malad. The counterfeit notes were not found at the place of their residence or at the place of their work. We agree with the observations made in the referal order. Prima facie, there may not be a case punishable under Section 489-A of I.P.C. in the instant case, but at the same time the offence of trafficing in forged or counterfeit currency notes is an offence which poses a challenge to the economy of the country. These offences , therefore, cannot be viewed lightly. The Courts must be sensitive in dealing with such offences and not to delete them 14 cri.appln-5343-10.odt without providing an opportunity to the prosecution to prove by leading evidence at the trial. The rapid changing technology in the process of counterfeiting, sale or trafficking transactions, which virtually amount to waging a financial war against the country cannot be lost sight of while interpreting such penal provisions. In a given case the prosecution may be able to prove that in the process of trafficking of counterfeit notes, the handlers of the accused operate from somewhere else and the accused are mere transporters of these notes. In such a situation, it can not be said that the accused were merely in possession of the counterfeit currency notes. The modus operandi of such crimes has different faces and some of them are veiled. It would be, therefore, imperative that the prosecution is allowed to lead evidence during the trial to lift such veil rather than truncketing it by the interpretatative mechanism before the trial commences. It will be only during the trial that the prosecution would be able to prove whether the possession of the notes was for trafficking. 12. With great respect we hold that the view taken in the earlier order dated 22nd October, 2010 in Criminal Application No.4744 of 2010 is unstainable and such a view could not have been recorded, in our considered opinion, while deciding the bail application. 15 cri.appln-5343-10.odt Therefore, the applicant in Criminal Application No.5343 of 2010 (before us) cannot claim bail on the basis of parity and rely upon the order dated 22nd October, 2010. Hence this application must fail. 13. The application is rejected. (U. D. SALVI, J.) (B. H. MARLAPALLE, J.)