HON’BLE SRI JUSTICE SAMUDRALA GOVINDARAJULU CRL.PETITION NO.3720 OF 2010 Date: 31.05.2010 Between: Vempalle Bhaskar Reddy …..Petitioner And: The State of Andhra Pradesh, rep. by the S.H.O, Proddatur III Town P.S, through its P.P. and another …..Respondents HON’BLE SRI JUSTICE SAMUDRALA GOVINDARAJULU CRL.PETITION NO.3720 OF 2010 ORDER: The petitioner/5th accused (A-5) is accused of offences punishable under Section 420 I.P.C, Sections 3, 5(2), 6 of the A.P. Money Circulation Schemes (Prohibition) Act (mistake for the Prize Chits and Money Circulation Schemes (Banning) Act, 1978, Section 5 of the A.P. Protection of Depositors of Financial Establishments Act and Section 74 of the Information Technology Act in Sessions Case No.1 of 2010 on the file of Sessions Judge, Kadapa arising out of Crime No.70 of 2008 of Proddatur III Town Police Station. A-5 seeks herein quashing of proceedings in S.C. No. 1 of 2010 under Section 482 Cr.P.C. The petitioner herein is shown as A-5 in F.I.R and A-4 in the charge sheet, since F.I.R against A-1 was quashed by this Court by an order dated 14.07.2009 in Crl.P.No.8732 of 2008. The accused in this order are referred to as per their array in F.I.R and not in the charge sheet. 2) It is prosecution case that A-2 to A-9 are working as agents of Swiss Cash Systematic Investiment Plan (S.I.P)-25 scheme and that they used to contact public and explain them about the scheme and collect Rs.50,000/- from each of the subscribers as investment in the scheme. As per the scheme, if the subscriber invests Rs.50,000/-, he gets Rs.11,250/- towards interest every month for a period of 12 months and after one month thereafter the principal amount will be returned back; and if the subscriber joins two members into the scheme by paying Rs.50,000/- each, then that subscriber will get 1,000 points and I.D number and if he further joins any more members, then he will get 10% commission on the amount paid by those members; and if that member having I.D collects Rs.5,00,000/-, he will get 1,000 e-points as bonanza and those points can be sold for money. As per canvassing of A-2 to A-5 the said company was established in the year 1948 in Domanica of South Africa and has number branches in many countries. 3) On report given by the 2nd respondent/defacto-complainant the Proddatur III Town Police registered case in Crime No.70 of 2008; and the crime was investigated into and finally charge sheet was filed for the above penal sections of law in the lower Court. It is contended by the petitioner’s counsel that the petitioner/A-5 is in the nature of a victim in the hands of A-1 and that he stands on the same footing as that of the 2nd respondent/defacto-complainant in this case. But A-5 did not take any steps by way of giving report to the police or by way of filing private complaint in criminal Court against A-1. Instead, A-2 to A-9 after joining hands with A-1, started recruiting members into the scheme by making the alleged false representations and made the 2nd respondent and other members to part with huge sums of money of Rs.50,000/- each. Ultimately the members/victims have lost their monies and did not get any returns in the scheme and did not get back their amounts. Even though the 2nd respondent alone gave report to the police on the basis of which the police registered the crime, during investigation of this crime, the police examined total number of 37 members/victims who have lost their monies in the scheme in view of the alleged representations made by A-2 to A-9, who acted as agents for the scheme. But for the alleged representations of A-2 to A-9, those 37 victims would not have joined as members and would not have parted with their monies. Further, as per prosecution allegations taken on their face value it cannot be said that Section 420 I.P.C and the provisions of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978. 4) Under the Andhra Pradesh Protection of Depositors of Financial Establishments Act, the question of appointing competent authority under Section 4 of the said Act arises only after attachment of properties of the defaulted financial establishment and persons responsible for management of affairs of the said financial establishment under Section 3 of the same Act. The competent authority is appointed for the purpose of taking steps before the Special Court for making the attachment absolute, for sale of the attached properties and distribution of proceeds thereof to the depositors/members who have lost their monies in the schemes floated by the financial establishment. The competent authority has nothing to do with filing of criminal case against the accused persons for offence punishable under Section 5 of the said Act either by the police or by the victims by way of a private complaint. Section 13 of the said Act deals with procedure and powers of the Special Court regarding offences and it reads as follows: (1) The Special Court may take cognizance of the offences without the accused being committed to it for trial and in trying the accused person, shall follow the procedure prescribed in the Code of Criminal Procedure, 1973 (Central Act 2 of 1974), for the trial of warrant cases by Magistrate. (2) The provisions of the Code of criminal Procedure, 1973 (Central Act 2 of 1974), shall, so far as may be, apply to the proceedings before a Special Court and for the purpose of the said provisions, a special Court shall be deemed to be a Magistrate. Thus, the Special Court under the said Act is deemed to be a Magistrate and the provisions of Cr.P.C are applicable to proceedings before the Special Court from the stage of taken cognizance of offences. The competent authority has nothing to do with filing of criminal case and conducting of the prosecution against the accused persons for offences punishable under the said Act. 5) It is contended by the petitioner’s counsel that proceedings against A-1 in this crime were quashed by this Court in Crl.P. No.8732 of 2008 on 14.07.2009 and that the petitioner/A-5 is in a better position than that of A-1. According to the prosecution case, it is A-2 to A-9 who made the alleged false representations to 37 victims examined in this case as prosecution witness Nos.1 to 37 by the investigating officer during investigation and induced them to part with their monies. The petitioner/A-5 is stated to have made direct contacts with some of those 37 victims and made them to part with their monies by inducing them to join as members in the scheme. Therefore, simply because A-1 and the defacto-complainant have compromised or compounded the matter, it cannot be said that all the other accused persons including A-5 are entitled to be relieved from this criminal case. Unless all 37 victims have compounded the matter with the accused, A-5 is not entitled for relief in this petition on that ground. Thus, the petitioner fails on all the contentions put forward in this petition. I find that there are no merits in this petition. 6) In the result, the petition is dismissed. _______________________________ SAMUDRALA GOVINDARAJULU,J. Date:31.05.2010. KSH