Case: Ramesh Rajagopal Vs. Devi Polymers Pvt. Ltd

4. The appellant was prosecuted by the respondent under Sections 409, 468 and 471 of the Indian Penal Code (in short the IPC) read with Sections 65 and 66 of the Information Technology Act, 2000 read with Section 120(b) of the IPC. The appellant is a Director in Devi Polymers Private Limited, Chennai which is a leader in Polyester Moulding Compound (PMC), Sheet Moulding Compound (SMC) and Dough Moulding Compound (DMCO) in India. It is also manufacturing SMC and DMC moulded components for the electrical, automotive and various other industries. The company is also supplying SMC and DMC compounds and components to almost all the leading electrical switch gear industries and automotive industries in India.  5. It has three Units – A, B and C. Unit C is being headed by the appellant. It is not disputed that the Unit C primarily renders consultancy services. However, all the three Units are units of one entity i.e. Devi Polymers Private Limited.  6. In the course of business, the appellant thought of improving the consultancy services and apparently contacted a consultant known as Michael T Jackson. He also contacted the regular consultants of the Company i.e. Devi Polymers Private Limited. The consultants apparently advised the creation of a separate entity known as Devi Consultancy Services and accordingly, in the web page that was created by the consultant, this name occurred. Since an invoice was raised by the consultant Michael T Jackson in the sum of 10,857.50 US Dollars, the said amount was paid from the funds of Devi Polymers Private Limited amounting to Rs.5,57,207/-. The amount of Rs.17,000/-has been paid by the Devi Polymers Private Limited to M/s Easy Link. These amounts were paid as advised by the appellant. It is significant that no amount has been paid or received by Unit C separately, independently of Devi Polymers Private Limited. All this, namely the engaging of consultants and payments to them was apparently done at the behest of the appellant.  7. The relationship being strained between the respondent and the appellant, who are relatives, several proceedings seem to have been initiated in the Company Law Board pertaining to oppression and mismanagement. As of now, it is said that the appellants petition for mismanagement has been dismissed but an appeal is pending.  8. However, in the course of disputes and the pending proceedings, the respondent initiated the instant criminal complaint against the appellant. The main circumstances which are relied upon by the respondent in the complaint is that in the website for Devi Consultancy Services that was created on the advice of the consultant is shown as a separate division independent of Devi Polymers Private Limited. According to the complainant, this has resulted in forgery, since there is no such thing as Devi Consultancy Services; though the existence of Unit C of Devi Polymers Private Limited, which deal with consultancy is not denied. The second circumstance seems to be the payment made by the Devi Polymers Private Limited to the consultants from their own account. The former is said to be forgery and the latter is said to be mis-appropriation of funds and breach of trust.

Reasoning:
21. As regards the commission of offences under the Information Technology Act, 2000 the allegations are that the appellant had, with fraudulent and dishonest intention on the website of Devi Consultancy Services i.e. www.devidcs.com that the former is a sister concern of Devi Polymers. Further, that this amounts to creating false electronic record. In view of the finding above we find that no offence is made out under Section 66 of the I.T. Act, read with Section 43. The appellant was a Director of Devi Polymers and nothing is brought on record to show that he did not have any authority to access the computer system or the computer network of the company. That apart there is nothing on record to show the commission of offence under Section 65 of the I.T. Act, since the allegation is not that any computer source code has been concealed, destroyed or altered. We have already observed that the acts of the appellant did not have any dishonest intention while considering the allegations in respect of the other offences. In the circumstances, no case is made out under Sections 65 and 66 of the I.T. Act, 200022. The High Court seems to have over looked these circumstances and has merely dismissed the petition under Section 482 of the Criminal Procedure Code on the ground that it requires evidence at a trial to come to any conclusion. We, however, find that the criminal proceedings initiated by the respondent constitute an abuse of process of Court and it is necessary to meet the ends of justice to quash the prosecution against the appellant