1 APPLN 3963 OF 2010 vks IN THE HIGH COURT OF JUDICATURE AT BOMBAY CRIMINAL APPELLATE JURISDICTION CRIMINAL APPLICATION NO.3963 OF 2010 Mr. Tushar R. Desai .. Applicants -versus Shri. R.K. Singh, & anr .. Respondents. Mr. Amit Desai, Senior Counsel, with Mr. Prakash Naik and Mr. Gopalkrishna Shenoy, for the Applicant. Mr. Y. M. Nakhawa, APP for the Respondent State. Mr. Rebecca Gonsalves, for the respondent NO.1. CORAM: R.C. CHAVAN, J. DATED: 20th January, 2011 P.C. 1. Rule. Made returnable forthwith and the matter is heard finally. 2. By this application, the applicant seeks quashing of proceeding carried before the learned Chief Metropolitan Magistrate, Mumbai, in Case No. 1346/S/2002, by the respondent No.1, on which order directing issuance of process was passed on 29.5.2002. According to applicant, this process itself was served upon the applicant on 10.2.2010. According to applicant, after the order directing issuance of process was passed by the learned Chief Metropolitan Magistrate, the adjudication proceeding came to an end by order dated 21st April, 2003 whereby the proceedings as against T.R. Desai i.e. the present applicant 2 APPLN 3963 OF 2010 were dropped. It was held that T.R. Desai was the Director in professional capacity and could not be held to be one Incharge of the noticee company. Therefore, according to applicant since the adjudication has itself ended in favour of the applicant, there is no question of prosecution contining against him. 3. I have heard learned counsel for the applicant as well as learned counsel for the respondent No.1 Enforcement Officer. Learned counsel for the applicant placed reliance of the judgment of this court, in Hemendra M. Kothari -vs- W.S. Waigankar & Anr, 2007 ALL MR (Cri) 3216; wherein similar facts were involved except that in that case the accused had moved an application for recalling of process which the learned Magistrate had rejected and Revision preferred by the accused also came to be dismissed by the Court of Sessions. Learned counsel for the Respondent No. 1 submits that the proper course open to the applicant, in this case was to move the learned Magistrate under Section 245 of the Criminal Procedure Code for discharge and the applicant could not have approached this Court directly. 4. Ordinarily a litigant must approach the lowest Court competent to redress the grievances and need not and should not rush directly to a higher forum. However, since the matter is covered by a judgment of this Court, and since 3 APPLN 3963 OF 2010 this application was entertained on 15.9.2010, and interim relief was granted and continued from time to time, no useful purpose will be served by remitting the parties back to the Trial Court for deciding the issue, on which this Court has already spent time. Therefore, this petition has been heard finally. 5. While deciding Hemendra M. Kothari’s (supra) case, this Court has referred to on the observations of the Hon’ble Supreme Court, in para 22 of Standard Chartered Bank -vs- Directorate of Enforcement and others, A.I.R. 2006, S.C. 1301, and held in para 18 and 21 as under: “18. Taking into consideration all these authorities with utmost respect, it must be said that the observation made in Standard Chartered Bank do not reverse observation and law laid down in K.C. Builders. Unless the K.C. Builders is reconsidered and a contrary view is taken by the Supreme Court, it will continue be binding authority. 21. It may be noted that in the present case the applicant was exonerated by the Dy. Director of Enforcement, who was Adjudicating Authority, in the adjudication proceedings. Admittedly that order was not challenged in appeal by the respondent and thus that order has become final. I have already noted the facts and findings of the Adjudicating Authority in detail. The Adjudicating Authority had clearly come to the conclusion that 4 APPLN 3963 OF 2010 there was no material to hold the present applicant guilty for contravention of the provisions of FERA and he was completely exonerated. When in the departmental proceedings before the Adjudicating Authority, the department could not establish the charges, it is difficult to imagine how the department could prove the same charges before the criminal Court when the standard of proof may be much higher and stringent than the standard of proof required in departmental proceedings.” 6. It is not shown that this judgment has been set aside or view taken therein has been altered. Learned counsel for the applicant submitted that while deciding Hemendra M. Kothari’s case, this Court had not considered the observations by Supreme Court in earlier part of para 22 of the judgment in Standard Chartered Bank’s (supra) case; which were to the following effect.:- “There is nothing in the Act to indicate that a finding in an adjudication, is binding on the Court in a prosecution under Section 56 of the Act. There is no indication that the prosecution depends upon the result of the adjudication.” 7. Even so since this Court had already taken the view that once adjudication comes to an end in favour of the accused, there would be no warrant for the prosecution to continue against him, and since the Supreme Court had 5 APPLN 3963 OF 2010 expressed only that the view taken in K.C. Builders -vs- The Assistant Commissioner of Income Tax 2004 (2) SCC, 731; would require reconsideration, till the Supreme Court reconsiders the judgment in K.C. Builders and takes a different view, it would have to be held if a party is exonerated in an adjudication, the prosecution for the same delinquency cannot be continued against such person. As rightly pointed out by the learned counsel for the applicant the standard of proof may be much higher and stringent i.e. proof beyond reasonable doubt in a criminal trial against the adjudication where preponderance of probabilities, would settle the issue. Therefore, after an adjudication a party is exonerated, there would be absolutely no reason to continue the prosecution against him. What has been observed by the Adjudicating Authority in this case is that the applicant was mainly functioning in his professional capacity and was not in control of the affairs of the company. In view of this, it is difficult to imagine as to how the applicant could be attributed to requisite mens rea for the acts which are allegedly committed by the company. 8. In view of this the application is allowed. The process issued against the applicant by the learned Chief Metropolitan Magistrate by order dated 29.05.2002, is quashed and set aside. (R. C. CHAVAN, J.)