((-1-)) mst IN THE HIGH COURT OF JUDICATURE AT BOMBAY CRIMINAL APPELLATE JURISDICTION CRIMINAL WRIT PETITION NO.1702 OF 2000 Gurindersingh Sandhu Petitioner versus State of Maharashtra Respondent WITH CRIMINAL WRIT PETITION NO.1703 OF 2000 Amitabh Chandra Petitioner versus State of Maharashtra Respondent S.R.Chitnis, Sr.Counsel i/by Ratnakar Singh for petitioners. Mr.S.S.Pednekar and J.H.Dedhi, APPs for State. CORAM : A.S.OKA, J. DATE : 22nd April 2009 JUDGEMENT : 1. These two writ petitions can be disposed of by common judgement as the same arise out of the same case. The petitioners in these two petitions are Indian Administrative Services (IAS) officers in the cadre of Government of Maharashtra. On 7th August 1989 the petitioner in Criminal Writ Petition No.1702 of 2000 was posted as the Managing Director of Maharashtra Small Scale Industries Development Corporation (hereinafter referred to as "the Corporation") which is an undertaking of the Government of Maharashtra. In December 1989 the petitioner ((-2-)) in Criminal Writ Petition No.1703 of 2000 was appointed as the Joint Managing Director of the said Corporation. 2. In the year 1992, a complaint was lodged by the General Manager of the said Corporation with the Joint Commissioner of Police alleging cheating at the instance of M/s.Metal Tube and Rolling Mills, Andheri, Mumbai (hereinafter referred to as "the said firm"). It was alleged that the said firm approached the said Corporation for importing certain raw material directly from the foreign suppliers on their behalf under the import assistance scheme of the said Corporation. The import stated in the agreement were made and material was imported from time to time in the name of said Corporation by opening Letters of Credit from time to time in the name of Foreign suppliers and hundies were raised in the name of said firm. Several transactions were made of import during the period of two years. Initially, the said firm was making payment. However, later on, the said firm stopped paying the amounts and by 31st May 1992 the amount due was approximately Rs.11.30 crores. ((-3-)) 3. It was pointed out in the complaint that the said firm had taken delivery of the entire material. However, later on the said firm started misrepresenting the facts. It is stated that on the date of the said complaint a sum of Rs.14.00 crores was due and payable by the said firm. Reference has been made to arbitration proceedings where sole arbitrator was the Managing Director of the said Corporation. An allegation was made of cheating. The investigation was carried out. The charge sheet was filed and charges were framed by the learned Magistrate against 1st to 5th accused who were the partners of the said firm. The 6th and 7th accused were at the relevant time General Manager and Finance Controller respectively of the said Corporation. The allegation against them is of breach of trust and commission of offences under sections 406 and 409 of Indian Penal read with section 120B of the Indian Penal Code or in the alternative under section 34 of the Indian Penal Code. 4. During pendency of the trial after recording of evidence of three prosecution witnesses, an application was moved by the ((-4-)) learned public prosecutor under section 319 of the Code of Criminal Procedure, 1973. The said application was praying for joining the petitioners in these two petitions as accused. By the impugned order, the said applications were allowed. 5. The learned Senior Counsel appearing for the petitioners has taken me through the impugned order. His submission is that in fact both the petitioners in these petitions were cited as witnesses and with a view to prevent them from deposing before the court they have been sought to be made accused. He submitted that the in view of the decision of Apex Court in the case of Michael Machado and another Vs. CBI and another ([2000]3-SCC-262), this was not at all a case to pass an order under section 319 of the said Code. He submitted that the impugned order is contrary to the law laid down by the Apex Court. Learned APP supported the order by submitting that when the learned Trial Judge found that there was material to proceed against the petitioners, he has rightly passed the impugned order. 6. I have carefully considered the ((-5-)) submissions. It will be necessary to refer to the decision of the Apex Court in the case of Michael Machado (supra) which lays down the scope of power under section 319 of the said Code. Paragraphs 11 and 12 of the said decision read thus :- "11. The basic requirements for invoking the above section is that it should appear to the court from the evidence collected during trial or in the inquiry that some other person, who is not arraigned as an accused in that case, has committed an offence fro which that person could be tried together with the accused already arraigned. It is not It is not It is not enough enough enough that the court entertained some that the court entertained some that the court entertained some doubt, doubt, doubt, from the evidence, about the from the evidence, about the from the evidence, about the involvement involvement involvement of another person in the of another person in the of another person in the offence. offence. offence. In other words, the court must In other words, the court must In other words, the court must have have have reasonable satisfaction from the reasonable satisfaction from the reasonable satisfaction from the evidence evidence evidence already collected regarding two already collected regarding two already collected regarding two aspects. aspects. aspects. First is that the other person First is that the other person First is that the other person has has has committed an offence. Second is that committed an offence. Second is that committed an offence. Second is that for for for such offence that other person could such offence that other person could such offence that other person could as as as well be tried along with the already well be tried along with the already well be tried along with the already arraigned arraigned arraigned accused accused accused. 12. But even then, what is conferred on the court is only a discretion as could be discerned from the words "the court may proceed against such person". The discretionary power so conferred should be exercised only to achieve criminal justice. It is not that the court should turn against another person whenever it comes across evidence connecting that other person also with the offence. A judicial exercise is called for, keeping a conspectus of the case, including the stage at which the trial has proceeded already and the quantum of evidence collected till then, and also the amount of time which the court had spent for collecting such evidence. It must be remembered that there is no compelling duty on the court to proceed against ((-6-)) other persons." (Emphasis added) 7. In the case of Palanisamy Gounder and another Vs. State represented by Inspector of Police ([2005]12-SCC-327), the Apex Court had again an occasion to consider the scope of section 319 of the said Code where the Apex Court has reiterated the view taken in the case of Michael Machado (supra). In another decision on this point in the case of Jarnail Singh and another Vs. State of Haryana and another ([2003]9-SCC-328) the Apex Court held thus :- "7. Undoubtedly, power under section 319 of the Code can be resorted to only when a person is not an accused before court and in the course of any inquiry into, or trial of, an offence, it appears from the it appears from the it appears from the evidence evidence evidence that such person has committed that such person has committed that such person has committed any any any offence for which he can be tried offence for which he can be tried offence for which he can be tried together together together with the accused with the accused with the accused. The court has discretion to proceed against such person for the offence which he appears to have committed. The inquiry into or trial is of "an offence" and not the offender." (Emphasis added) 8. In the light of the law laid down by the Apex Court, the correctness of the impugned order will have to be tested. What is held by the Apex Court is that the condition precedent for exercising the power under section 319 of the said Code is that the Court must record a ((-7-)) reasonable satisfaction from the evidence which is already recorded that the person who is sought to be made accused has committed the offence and that the said person could be tried alongwith the accused who are already arraigned. Thus, it must appear to the Court from the evidence on record that the person has committed the offence alleged. Unless the Court is satisfied that there is a reasonable prospect of the case against the newly added accused ending in conviction, the Court cannot pass an order under section 319 of the said Code. 9. The impugned order reads thus:- "ORDER Heard App. Perused evidence of PW 1, PW No.2 and P.W.No.3 on request of App. I also perused statement of Mr.Naik and Mr.Shinde which are recorded by Police during investigation. The fact that initially proposal was rejected then it was granted then though Accused were not paying dues and though all these facts were known yet 11 crores have been disbursed. According to APP this is sufficient evidence and material to join persons named in this application as accused. I am also of the same opinion. Hence I am inclined to join them as accused in this case to face trial alongwith present Accused. ((-8-)) Persons named be joined as Accused issue process as prayed for against persons name in Application." 10. It is obvious that the satisfaction as contemplated by the Apex Court has not been recorded by the learned Judge. The learned Judge has not at all discussed or referred to the material which was allegedly brought on record against the petitioners. The learned Judge has not at all recorded a finding that on the basis of material on the record that he was satisfied that there was a reasonable prospect of trial against the petitioners ending in conviction. By merely observing that there is sufficient evidence and material to join the petitioners as accused, the power under section 319 of the said Code could not have been exercised. Therefore, the impugned order will have to be quashed and set aside being an order completely contrary to the law laid down by the Apex Court. However, setting aside of the impugned order will not prevent the Court from exercising the said power at an appropriate stage of proceedings, provided the tests laid down by the Apex Court are satisfied. 11. Hence, I pass following order :- ((-9-)) (a) Subject to what is observed above, the impugned order dated 28th November 2000 is quashed and set aside; (b) Rule is accordingly made absolute. (A.S.OKA, J.)