Case: Amit Suresh Arya Vs. Central Bureau of Investigation, Through Police Station Inspector, Anti-Corruption Bureau, Nagpur &amp; Others

direction, and be read over to the informant; and every such information, whether given in writing or reduced to writing as aforesaid, shall be signed by the person giving it, and the substance thereof shall be entered in a book to be kept by such officer in such form as the State Government may prescribe in this behalf.(2) A copy of the information as recorded under sub-section (1) shall be given forthwith, free of cost, to the informant.(3) Any person aggrieved by a refusal on the part of an officer in charge of a police station to record the information referred to in sub-section (1) may send the substance of such information, in writing and by post, to the Superintendent of Police concerned who, if satisfied that such information discloses the commission of a cognisable offence, shall either investigate the case himself or direct an investigation to be made by any police officer subordinate to him, in the manner provided by this Code, and such officer shall have all the powers of an officer in charge of the police station in relation to that offence.22. The proposition of law relating to information in cognisable cases is well settled and any person orally or in writing can set criminal law into motion. In this background, we do not find any infirmity regarding the locus to lodge the report. The third contention raised by the learned counsel for the applicants is, therefore, negatived in the above background.23. (iv) Company is not arraigned as an accused and without arraigning company as an accused, the prosecution against applicants is not maintainable :One of the grounds on which criminal prosecution is attacked is that company is not arraigned as an accused and prosecution is launched only against the Directors of the Company. To substantiate the submission, reliance is placed on the decision of the Honble Supreme Court in Aneeta Hada v. Godfather Travels and Tours Private Limited, (2012) 5 SCC 661. The dispute in this case was under Section 138 of the Negotiable Instruments Act, 1881. Company was not arraigned as an accused and only officers of company were implicated. The Honble Supreme Court held that a distinction must be borne in mind between cases where a company had not been made an accused and the one where despite making it an accused, it cannot be proceeded against because of a legal bar. Criminal liability on account of dishonour of cheque in the case before the Supreme Court was primarily on drawer company and extended to its officers only when conditions incorporated in Section 141 of the Negotiable Instruments Act could be satisfied. In this background, the Honble Supreme Court held that for maintaining prosecution under Section 141, arraigning of company as an accused is imperative.24. In the present case, allegations of cheating and forgery are in the personal capacity of the applicants. The offences alleged being under the penal law element of mens rea also needs to be considered. The question of company sharing the criminal liability with its officers cannot be said to be imperative in the present set of facts and circumstances and particularly in view of the offences alleged against the applicants. The facts are distinguishable. We, therefore, do not find any merit in this contention also raised by the learned counsel for the applicants.On Merits25. Next question that now remains for consideration is whether FIR, charge-sheet, and connecting papers thereto make out a case against the applicants to proceed for the offences alleged against them. It is significant to note that allegations of criminal conspiracy have been levelled against the applicants and three officers of the Central Excise and Customs Department named above. It is the case of prosecution that applicants - both the Directors of M/s. Eva Tex Private Limited, diverted the material to the domestic tariff area and by the aforesaid acts, caused loss of revenue to the tune of Rs.71 Lacs by evading customs and central excise duty. So far as the loss of revenue is concerned, officer of Central Excise has instituted the complaint under Sections 9, 9AA and 10 of the Central Excise Act, 1944. When it comes to criminal prosecution and particularly offence under Section 120-B of the Indian Penal Code, allegations against applicants are that in connivance with the officers of Customs and Central Excise, they forged the documents, cheated the department by using the forged documents as genuine knowing them that they are forged. It is pertinent to note that the officers of Customs and Central Excise against whom allegations made in FIR were also involved in the offences under the Prevention of Corruption Act, 1988. The sanction to prosecute those officers came to be refused by the sanctioning authority vide order dated 9.11.2006. After considering the entire material placed before the sanctioning authority, the said authority observed that CBI has not adduced any evidence about the connivance of the officers with the unit in perpetrating this fraud. Though it was further observed that officers were surely negligent and lackadaisical in their duties but in the absence of reasonable and cogent evidence, authority found that it may not be correct to show that they entered into criminal conspiracy warranting prosecution against them.26. We have perused the contents of FIR lodged on 28.9.2005. The offence occurred is in the year 2004. The Central Excise Department has already taken care of by instituting a complaint an evasion of Customs and Excise duty. The grievance made in the complaint by Central Excise Department are almost identical to the allegations in FIR. We have already held above that the doctrine of double jeopardy would not be attracted in the present case, but since the allegations are almost common and particularly the sanctioning authority did not find any evidence on close scrutiny, we find that continuance of the criminal prosecution against the applicants would be nothing but an abuse of process of law. Hence, on merits applicants do succeed and accordingly we pass the following order :

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]10. We have given our anxious consideration to the rival submissions of the learned counsel for both the sides. We have also examined the relevant provisions of Delhi Act, Article 166 of the Constitution of India relating to conduct of business of the Government of the State and case law cited by both the parties. We are of the view that preliminary objections raised on behalf of the applicants are not sustainable though on merits, they succeed as ingredients of the offences under the Penal Law are not made out from the FIR,and the connecting papers thereto.From a closer scrutiny of the relevant provisions of the Delhi Act, it is crystal clear that Section 3 refers to "Notification" and requires the Central Government to issue notification specifying offences or classes of offences to be investigated by the Delhi Special Police Establishment. Section 5 uses the term "order" and empowers the Central Government to extend powers and jurisdiction of Special Police Establishment to other areas not covered by the Act. Section 6 speaks of consent of State Government for the exercise of powers and jurisdiction of the Delhi Special Establishment without referring to the term "notification" or "order". As Section 6 merely requires consent of the State Government for the application of the Delhi Act, in our considered view, by order dated 22.2.1989 State Government has given the consent as envisaged by Section 6 of the Delhi Act and prosecution instituted by CBI against the applicants cannot be said to be without jurisdiction. In the light of the above, we find that the issue of consent under Section 6 raised by the learned counsel for applicants is unsustainable in law.So far as proceedings in Regular Criminal Case No.2303/2007 arising out ofNo.5/2007 in Crime No.RCNAG 2005A0012 are concerned, the same is for the offences punishable under Sections, 468 and 471 of the Indian Penal Code.Needless to state that the offences alleged in FIR are the distinct and separate offences against the same persons and even if they are appearing to be identical to the allegations in complaint under the Central Excise Act, cannot be said to be hit by the doctrine of double jeopardy, as they are not the same offence. As such, in our opinion, provisions of Section 300 of the Code of Criminal Procedure and Section 26 of the General Clauses Act are not attracted in the facts of the present case and we find that second objection raised by the learned counsel for the applicants holds no water.19. (iii) Considering the offences alleged, aggrieved person ought to have lodged the report and based on source information not disclosed at any time, complainant has no locus to lodge report alleging the offences of cheating, forgery etc.:Another ground on which criminal prosecution is assailed is regarding the locus of complainant to lodge the complaint. Submission of the applicants is that FIR is lodged on the basis of source information which has never been disclosed at any time and for the offences particularly of cheating and forgery, it was incumbent on the prosecution agency to disclose the source of information and the name of informant. In support thereof, reliance is placed on the decisions of the Honble Supreme Court in Joseph Salvaraja v. State of Gujarat and others, (2011) 7 SCC 59   and Mohammed Ibrahim and others v. State of Bihar and another, (2009) 8 SCC 751. 20. On going through both the decisions of the Honble Supreme Court, it can be seen that the facts were not identical to the present controversy and in the given facts and circumstances of the case, the Honble Supreme Court in the first case held that FIR was an abuse of process of law, dispute was purely of civil nature, commission of criminal offence to wreak vengeance was alleged and in such a case refusal of High Court to quash FIR under Section 482 of the Code of Criminal Procedure with liberty to file discharge application was to be quashed and set aside.In another decision, the observations of Honble Supreme Court were that criminal courts should ensure that criminal proceedings are not misused for settling scores or pressurising parties to settle civil disputes. The ingredients of the offence of cheating and forgery defined under Section 415 and punishable under Section 420 of the Indian Penal Code, came to be reiterated by the Honble Supreme Court in the said case.21. In the case on hand, FIR has been lodged by Superintendent of Police, CBI, Nagpur. Learned counsel refers to the provisions of Section 39 of the Code of Criminal Procedure and attempts to demonstrate that offences relating to cheating and forgery are not covered by this provision and, therefore, it was incumbent on the aggrieved person to come forward and lodge report. Section 39 requires public to give information of certain offences and speaks that every person aware of the commission of, or of the intention of any other person to commit any offence punishable under the section mentioned in Section 39 shall forthwith give information to the nearest Magistrate or public officer of such commission or intention. The offences under Sections420, 468 and 471 of the Indian PenalCode are cognisable. As these offences are cognisable, offence alleged under Sectionof the Indian Penal Code is also cognisable. Section 154 of the Code of Criminal Procedure relates to information in cognisable cases. The provisions of Section 154 of Cr.P.C. read thus :154. Information in cognisableEvery information relating to the commission of a cognisable offence, if given orally to an officer in charge of a police station, shall be reduced to writing by him or under his direction, and be read over to the informant; and every such information, whether given in writing or reduced to writing as aforesaid, shall be signed by the person giving it, and the substance thereof shall be entered in a book to be kept by such officer in such form as the State Government may prescribe in this behalf.(2) A copy of the information as recorded under(1) shall be given forthwith, free of cost, to the informant.(3) Any person aggrieved by a refusal on the part of an officer in charge of a police station to record the information referred to in(1) may send the substance of such information, in writing and by post, to the Superintendent of Police concerned who, if satisfied that such information discloses the commission of a cognisable offence, shall either investigate the case himself or direct an investigation to be made by any police officer subordinate to him, in the manner provided by this Code, and such officer shall have all the powers of an officer in charge of the police station in relation to that offence.22. The proposition of law relating to information in cognisable cases is well settled and any person orally or in writing can set criminal law into motion. In this background, we do not find any infirmity regarding the locus to lodge the report. The third contention raised by the learned counsel for the applicants is, therefore, negatived in the above background.23. (iv) Company is not arraigned as an accused and without arraigning company as an accused, the prosecution against applicants is not maintainable :One of the grounds on which criminal prosecution is attacked is that company is not arraigned as an accused and prosecution is launched only against the Directors of the Company. To substantiate the submission, reliance is placed on the decision of the Honble Supreme Court in Aneeta Hada v. Godfather Travels and Tours Private Limited, (2012) 5 SCC 661.  The dispute in this case was under Section 138 of the Negotiable Instruments Act, 1881. Company was not arraigned as an accused and only officers of company were implicated. The Honble Supreme Court held that a distinction must be borne in mind between cases where a company had not been made an accused and the one where despite making it an accused, it cannot be proceeded against because of a legal bar. Criminal liability on account of dishonour of cheque in the case before the Supreme Court was primarily on drawer company and extended to its officers only when conditions incorporated in Section 141 of the Negotiable Instruments Act could be satisfied. In this background, the Honble Supreme Court held that for maintaining prosecution under Section 141, arraigning of company as an accused is imperative.24. In the present case, allegations of cheating and forgery are in the personal capacity of the applicants. The offences alleged being under the penal law element of mens rea also needs to be considered. The question of company sharing the criminal liability with its officers cannot be said to be imperative in the present set of facts and circumstances and particularly in view of the offences alleged against the applicants. The facts are distinguishable. We, therefore, do not find any merit in this contention also raised by the learned counsel for theis significant to note that allegations of criminal conspiracy have been levelled against the applicants and three officers of the Central Excise and Customs Department named above. It is the case of prosecution that applicantsboth the Directors of M/s. Eva Tex Private Limited, diverted the material to the domestic tariff area and by the aforesaid acts, caused loss of revenue to the tune of Rs.71 Lacs by evading customs and central excise duty. So far as the loss of revenue is concerned, officer of Central Excise has instituted the complaint under Sections 9, 9AA and 10 of the Central Excise Act, 1944. When it comes to criminal prosecution and particularly offence under Sectionof the Indian Penal Code, allegations against applicants are that in connivance with the officers of Customs and Central Excise, they forged the documents, cheated the department by using the forged documents as genuine knowing them that they are forged. It is pertinent to note that the officers of Customs and Central Excise against whom allegations made in FIR were also involved in the offences under the Prevention of Corruption Act, 1988. The sanction to prosecute those officers came to be refused by the sanctioning authority vide order dated 9.11.2006. After considering the entire material placed before the sanctioning authority, the said authority observed that CBI has not adduced any evidence about the connivance of the officers with the unit in perpetrating this fraud. Though it was further observed that officers were surely negligent and lackadaisical in their duties but in the absence of reasonable and cogent evidence, authority found that it may not be correct to show that they entered into criminal conspiracy warranting prosecution against them.26. We have perused the contents of FIR lodged on 28.9.2005. The offence occurred is in the year 2004. The Central Excise Department has already taken care of by instituting a complaint an evasion of Customs and Excise duty. The grievance made in the complaint by Central Excise Department are almost identical to the allegations in FIR. We have already held above that the doctrine of double jeopardy would not be attracted in the present case, but since the allegations are almost common and particularly the sanctioning authority did not find any evidence on close scrutiny, we find that continuance of the criminal prosecution against the applicants would be nothing but an abuse of process of law.