Giri Raj Sharma vs U.O.I. Thru. Directorate Of ...
2021 Latest Caselaw 11284 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH
 
 

A.F.R.
 
Reserved
 
Case :- U/S 482/378/407 No. - 4050 of 2021
 
Applicant :- Giri Raj Sharma
 
Opposite Party :- U.O.I. Thru. Directorate Of Enforcement
 
Counsel for Applicant :- Pranjal Krishna
 
Counsel for Opposite Party :- A.S.G.
 

 
Hon'ble Rajesh Singh Chauhan,J.

1. Heard Sri Pranjal Krishna, learned counsel for the petitioner and Sri Shiv P. Shukla, learned counsel for the opposite parties.

2. On the first date of admission, this Court has passed the order dated 23.10.2021 as under:-

"Heard Sri Pranjal Krishna, learned counsel for the petitioner and Sri S.B. Pandey, learned Assistant Solicitor General of India and the learned Senior Advocate assisted by Sri Shiv P. Shukla, learned Central Government Standing Counsel for the opposite parties.

By means of this petition, the petitioner has prayed the following relief:-

"Wherefore, it is most respectfully prayed that this Hon'ble Court may graciously be pleased to quash the petitioner's prosecution in the Criminal Case No.1154 of 2021 (Directorate of Enforcement, Lucknow vs. Giri Raj Sharma) under Sections 3 & 4 of Prevention of Money Laudering Act, 2002 arising out of ECIR/09/PMLA/LZO/2013 and pending before the learned Special Court (PMLA), Lucknow including the Supplementary Prosecution Complaint dated 29.06.2020 and the cognizance order dated 11.08.2021 so as to secure the ends of justice."

Learned counsel for the petitioner has contended that the present case is a glaring example of misuse of the process of law inasmuch as the learned Special Judge by taking cognizance against the petitioner on the supplementary prosecution complaint dated 29.06.2020 (E.D.) for allegedly committing an offence under Section 3 punishable under Section 4 of Prevention of Money Laudering Act, 2002 (here-in-after referred to as the "Act, 2002") without taking into account the fact that that petitioner is being falsely prosecuted in this case. Therefore, he is humbly praying for the extraordinary jurisdiction of this Court under Section 482 Cr.P.C.

Sri Pranjal Krishan, learned counsel for the petitioner has drawn attention of this Court toward running page 58 of the petition, which is portion of the charge-sheet filed by the C.B.I. on 13.10.2013, whereby the alleged culpability of the present petitioner has been indicated. Sri Pranjal Krishna has read over the relevant portion relating to the present petition in the C.B.I. charge-sheet and thereafter drawn attention of this Court towards the complaint filed by the E.D. seeking attention of running page 133 of the petitioner wherein the role of the accused i.e. the present petitioner is blank and conclusion of the investigation is verbatim the same as of the C.B.I.

Sri Pranjal Krishna has submitted that if the E.D. has arrived on the conclusion after investigation, if any, the conclusion of E.D. should have been shown to be an independent conclusion but E.D. has narrated the same conclusion as of C.B.I. without application of mind.

Sri Pranjal Krishna has also submitted that the supplementary complaint has been filed in sheer, illegal and unwarranted manner inasmuch as such supplementary complaint could have not been filed invoking the explanation No.2 of Section 44 (1) of Act, 2002.

Per contra, the learned counsel for the opposite parties has raised a preliminary objection regarding maintainability of this petition saying that as per Section 47 of the Act, 2002 instead of filing the petition under Section 482 Cr.P.C., the petitioner should file revision.

However on that objection, Sri Pranjal Krishna, learned counsel for the petitioner has referred the dictum of Hon'ble Apex Court rendered in re: State of Haryana and others vs. Bhajan Lal and others reported in (1992) Supp. (1) SCC 335 and Pepsi Foods Ltd. and another vs. Special Judicial Magistrate and others reported in (1998) 5 SCC 749 by saying that this petition is very well maintainable.

Since the learned counsel for opposite parties wants to address on the aforesaid legal submission of learned counsel for the petitioner, for that, he prays some shortest time, therefore, list/ put up this case on 27.10.2021 as fresh in the additional cause list to enable the learned counsel for the opposite parties to address the Court on the point of maintainability.

Learned counsel for the petitioner shall also come prepared on the point of maintainability on the next date."

3. Replying the objection regarding maintainability of the present petition filed under Section 482 Cr.P.C., Sri Pranjal Krishna has drawn attention of this Court towards Section 47 of the Prevention of Money Laundering Act, 2002 (here-in-after referred to as the "Act, 2002"), which reads as under:-

"47. Appeal and revision. -The High Court may exercise, so far as may be applicable, all the powers conferred by Chapter XXIX or Chapter XXX of the Code of Criminal Procedure, 1973 (2 of 1974), on a High Court, as if a Special Court within the local limits of the jurisdiction of the High Court were a Court of Session trying cases within the local limits of the jurisdiction of the High Court."

4. Sri Pranjal Krishna has contended that under Section 47 of the Act, 2002, the High Court has got the discretionary power of appeal and revision. The term 'may' has been used to mean they are in addition and in supplement to Section65 of the Act, 2002 which talks about the applicability of the Provisions of Cr.P.C. to cases brought under the Act, 2002 which very well include the provisions of Section 482 Cr.P.C. Besides, by means of this petition, the petitioner has not only assailed the cognizance order dated 11.08.2021 but has prayed for quashing the Supplementary Prosecution Complaint dated 29.06.2020. Under the revisional jurisdiction the cognizance order can be assailed but the Supplementary Prosecution Complaint may not be assailed as it would be beyond the scope of revision. However, under the inherent jurisdiction of this Court under Section 482 Cr.P.C. both the cognizance order as well as the Supplementary Prosecution Complaint may be assailed. Therefore, in the given circumstances, the present petitioner may not be relegated to file the criminal revision instead of petition under Section 482 Cr.P.C.

5. In support of his aforesaid arguments, Sri Pranjal Krishna has cited the decision of Hon'ble Apex Court in re: New India Assurance Co. Ltd. vs. Krishna Kumar Pandey (Criminal Appeal No.1852 o 2019 arising out of Special Leave to Appeal (Crl.) No.8499 of 2014), whereby vide para-8 the Hon'ble Apex Court has observed as under:-

"8. The scope of the revisional jurisdiction of the High Court (or Sessions Court) under Section 397 Cr.P.C is limited to the extent of satisfying itself as to the correctness, legality or propriety of any finding, sentence or order passed by an inferior Court. The revisional Court is entitled to look into the regularity of any proceeding before an inferior Court. The revisional court is entitled to look into the regularity of any proceeding before an inferior Court. As reiterated by this Court in a number of cases, the purpose of this revisional power is to set right a patent defect or an error of jurisdiction or law."

6. Sri Pranjal Kirshna has also cited the dictum of Hon'ble Apex Court in re: Prabhu Chawla vs. State of Rajasthan and another reported in (2016) 16 SCC 30 referring paras-4, 5, 6, 7 & 8, which read as under:-

"4. Mr. P.K. Goswami learned senior advocate for the appellants supported the view taken by this Court in the case Dhariwal Tobacco Products Ltd. (supra). He pointed out that in paragraph 6 of this judgment Justice S. B. Sinha took note of several earlier judgments of this Court including that in R.P. Kapur v. State of Punjab and Som Mittal v. Govt. of Karnataka for coming to the conclusion that: (Dhariwal Case, SCC p. 372)

"6......only because a revision petition is maintainable, the same by itself, ... would not constitute a bar for entertaining an application under Section 482 of the Code."

5. Mr. Goswami also placed strong reliance upon judgment of Krishna Iyer, J. in a Division Bench in the case of Raj Kapoor and Ors v. State and Ors. Relying upon judgment of a Bench of three Judges in the case of Mathu Limaye v. The State of Maharashtra and quoting therefrom, Krishna Iyer, J. in his inimitable style made the law crystal clear in paragraph 10 which runs as follows:

"10. The first question is as to whether the inherent power of the High Court under Section 482  stands repelled when the revisional power under  Section 397 overlaps. The opening words of  Section 482 contradict this contention because nothing of the Code, not even Section 397 , can affect the amplitude of the inherent power preserved in so many terms by the language of Section 482 . Even so, a general principle pervades this branch of law when a specific provision is made: easy resort to inherent power is not right except under compelling circumstances. Not that there is absence of jurisdiction but that inherent power should not invade areas set apart for specific power under the same Code.  In Madhu Limaye v. The State of Maharashtra this Court has exhaustively and, if I may say so with great respect, correctly discussed and delineated the law beyond mistake. While it is true that  Section 482  is pervasive it should not subvert legal interdicts written into the same Code, such, for instance, in Section 397 (2). Apparent conflict may arise in some situations between the two provisions and a happy solution

'would be to say that the bar provided in sub-section (2) Section 397 operates only in exercise of the revisional power of the High Court, meaning thereby that the High Court will have no power of revision in relation to any interlocutory order. Then in accordance with one or the other principles enunciated above, the inherent power will come into play, there being no other provision in the Code for the redress of the grievance of the aggrieved party. But then, if the order assailed is purely of an interlocutory character which could be corrected in exercise of the revisional power of the High Court under the 1898 Code, the High Court will refuse to exercise its inherent power. But in case the impugned order clearly brings about a situation which is an abuse of the process of the Court or for the purpose of securing the ends of justice interference by the High Court is absolutely necessary, then nothing contained in  Section 397 (2) can limit or affect the exercise of the inherent power by the High Court. But such cases would be few and far between. The High Court must exercise the inherent power very sparingly. One such case would be the desirability of the quashing of a criminal proceeding initiated illegally, vexatiously or as being without jurisdiction' (SCC pp.555-56, para 10).

In short, there is no total ban on the exercise of inherent power where abuse of the process of the court or other extraordinary situation excites the court's jurisdiction. The limitation is self-restraint, nothing more. The policy of the law is clear that interlocutory orders, pure and simple, should not be taken up to the High Court resulting in unnecessary litigation and delay. At the other extreme, final orders are clearly capable of being considered in exercise of inherent power, if glaring injustice stares the court in the face. In between is a tertium quid, as Untwalia, J. has pointed out as for example, where it is more than a purely interlocutory order and less than a final disposal. The present case falls under that category where the accused complain of harassment through the court's process. Can we state that in this third category the inherent power can be exercised? In the words of Untwalia, J.: (SCC p. 556, para 10)

'10.... The answer is obvious that the bar will not operate to prevent the abuse of the process of the Court and/or to secure the ends of justice. The label of the petition filed by an aggrieved party is immaterial. The High Court can examine the matter in an appropriate case under its inherent powers. The present case undoubtedly falls for exercise of the power of the High Court in accordance with  Section 482  of the 1973 Code, even assuming, although not accepting, that invoking the revisional power of the High Court is impermissible.'

I am, therefore clear in my mind that the inherent power is not rebuffed in the case situation before us. Counsel on both sides, sensitively responding to our allergy for legalistics, rightly agreed that the fanatical insistence on the formal filing of a copy of the order under cessation need not take up this court's time. Our conclusion concurs with the concession of counsel on both sides that merely because a copy of the order has not been produced, despite its presence in the records in the court, it is not possible for me to hold that the entire revisory power stands frustrated and the inherent power stultified."

"6.  In our considered view any attempt to explain the law further as regards the issue relating to inherent power of High Court under Section 482 Cr.P.C. is unwarranted. We would simply reiterate that Section 482 Cr.P.C.  begins with a non-obstante clause to state:

"482. Saving of inherent powers of High Court.- Nothing in this Code shall be deemed to limit or affect the inherent powers of the High Court to make such orders as may be necessary to give effect to any order under this Code, or to prevent abuse of the process of any Court or otherwise to secure the ends of justice."

A fortiori, there can be no total ban on the exercise of such wholesome jurisdiction where, in the words of Krishna Iyer, J.

"abuse of the process of the Court or other extraordinary situation excites the court's jurisdiction. The limitation is self-restraint, nothing more."

We venture to add a further reason in support. Since Section 397  Cr.P.C. is attracted against all orders other than interlocutory, a contrary view would limit the availability of inherent powers under Section 482 Cr.P.C. only to petty interlocutory orders! A situation wholly unwarranted and undesirable.

7. As a sequel, we are constrained to hold that the Division Bench, particularly in paragraph 28, in the case of Mohit alias Sonu and another (supra) in respect of inherent power of the High Court in Section 482  of the Cr.P.C. does not state the law correctly. We record our respectful disagreement.

8. In our considered opinion the learned Single Judge of the High Court should have followed the law laid down by this Court in the case of Dhariwal Tobacco Products Ltd. (supra) and other earlier cases which were cited but wrongly ignored them in preference to a judgment of that Court in the case of Sanjay Bhandari (supra) passed by another learned Single Judge on 05.02.2009 in S.B. Criminal Miscellaneous Petition No. 289 of 2006 which is impugned in the connected Criminal Appeal arising out of Special Leave Petition No. 4744 of 2009. As a result, both the appeals, one preferred by Prabhu Chawla and the other by Jagdish Upasane & Ors. are allowed. The impugned common order dated 02.04.2009 passed by the High Court of Rajasthan is set aside and the matters are remitted back to the High Court for fresh hearing of the petitions under Section 482 of the Cr.P.C. in the light of law explained above and for disposal in accordance with law. Since the matters have remained pending for long, the High Court is requested to hear and decide the matters expeditiously, preferably within six months."

7. In view of the aforesaid decisions of Hon'ble Apex Court, Sri Pranjal Krishna has submitted that the present petition filed under Section 482 Cr.P.C. is maintainable.

8. Per contra, Sri Shiv P. Shukla, learned counsel for the opposite parties has cited the decision of Orissa High Court dated 16.12.2013 in re: Smt. Janata Jha and another vs. Assistant Director, Directorate of Enforcement, Government of India and another (CRLMC No.114 of 2011 (Application U/S 482 Cr.P.C.)) by submitting that one petition was filed before the High Court under Section 482 Cr.P.C. under the same Act i.e. Act, 2002 stand dismissed by the Orissa High Court observing that "it may be made clear that the question as to whether the inherent power available under Section 482 Cr.P.C. can be exercised for quashing a proceeding initiated under PMLA or not, is left open."

9. After considering the arguments of the parties on the point of maintainability, I find that the Orissa High Court in re: Smt. Janata Jha and another (supra) has not held that the petitioner under Section 482 Cr.P.C. is not maintainable as the petitioners of that petition have not availed the remedy of revision, rather it has been observed that for quashing the proceeding initiated under the Act, 2002 the High Court may examine as to whether the inherent powers are to be invoked or not.

10. On the other hand, the Hon'ble Apex Court in re: New India Assurance Company Ltd. (supra) has clearly held that the scope of revisional jurisdiction of the High Court is limited to the extent of satisfying itself as to the correctness, legality or propriety of any finding, sentence or order passed by an inferior court. The purpose of revisional power is to set right a patent defect or an error of jurisdiction or law.

11. Likewise, the Hon'ble Apex Court in re:Prabhu Chawla (supra) has observed that there is no ban on the exercise of inherent power where abuse of the process of the court or other extraordinary situation excites the court's jurisdiction. The policy of law is clear that interlocutory orders, pure and simple, should not be taken up to the court resulting unnecessary litigation and delay.

12. Therefore, keeping in view the prayers made in the petition, the inherent jurisdiction of this Court enshrined under Section 482 Cr.P.C. may be invoked and, therefore, the present petition is maintainable.

13. So far as the prima-facie satisfaction of the Court for interim relief is concerned, I would refer Annexure No.4 of the petition which is a Prosecution Complaint No.ECIR/09/PMLA/LZO/2013 filed by the Directorate of Enforcement (here-in-after referred to as the "E.D.") on 30.06.2018. Thereafter, I would refer Annexure No.5 of the petition, which is a Supplementary Prosecution Complaint, the impugned complaint filed on 29.06.2020.

14. Admittedly, the present petitioner was not accused in the Prosecution Complaint filed on 30.06.2018. However, in the Supplementary Prosecution Complaint, which was filed on 29.06.2020, the present petitioner was made accused.

15. Sri Pranjal Krishna, learned counsel for the petitioner has drawn attention of this Court towards various statements of various persons recorded under Section 50 of the Act, 2002, pursuant to which, the Supplementary Prosecution Complaint has been filed against the petitioner. It would be apt to indicate the names of those persons and dates when the statements have been recorded.

 
(a)	Statement  of  Mr. Prabhat Chand Gopalan dated 25.10.2016
 
(b) 	Statement  of the present petitioner (Giri Raj Sharma) dated 	08.11.2016
 
(c)     Statement  of  Mr. Dilip Kumar  dated 13.01.2015 and 18.10.2016
 
(d)	Statement  of  Mr. Jonas Lal Marandi dated 09.01.2015 and 	25.10.2016
 
(e)	Statement  of Mr. Dhirendra Kumar Singh dated 16.09.2016, 	09.11.2016 & 10.11.2016
 
(f)	Statement  of  Mr. Bhupendra Singh dated 21.09.2016
 
(g)	Statement  of  Mr. Rakesh Kumar Gupta dated 27.10.2016
 
(h)	Statement  of  Mr. B.R. Arora dated 23.01.2015, 19.10.2016 & 	21.11.2017
 
(i)	Statement  of  Mr. A.C. Srivastava dated 29.06.2018
 
(j)	Statement  of  Mr. H.C. Pant dated 29.06.2018
 
	The careful perusal thereof would clearly reveal that all the aforesaid statements of the aforesaid persons were recorded under Section 50 of the Act, 2002 before 30.06.2018 i.e. the date of filing the Prosecution Complaint before the learned trial court. 
 

 
16.	It would be apposite to refer the explanation (ii) of Section 44 (1) of the Act, 2002 as the Supplementary Prosecution Complaint could have been filed by the ED under the aforesaid provisions of law
 
"44. Offence triable by Special Courts.- (1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974),-
 

(ii) the complaint shall be deemed to include any subsequent complaint in respect of further investigation that may be conducted to bring any further evidence, oral or documentary, against any accused person involved in respect of the offence, for which complaint has already been filed, whether named in the original complaint or not."

[[

17. As per the aforesaid provision of law, further investigation is permissible but that may be conducted to bring any 'further evidence', oral or documentary, against any accused person involved in respect of offence, for which, the complaint has already been filed, whether he is named in the original complaint or not.

18. So as to examine the authenticity or legality of the impugned Supplementary Prosecution Complaint in the instant case, this Court has to examine as to whether the Supplementary Prosecution Complaint has been filed on the basis of any 'further evidence' . On the basis of material available on record, the prosecution has not considered any 'further evidence', rather the statements of various persons, which have been recorded under Section 50 of the Act, 2002 prior to the date when the first complaint was filed on 30.06.2018, have been considered.

19. On a pin point query being made from learned counsel for the opposite parties as to why the petitioner has not been made accused in the original complaint which was filed on 30.06.2018 on the basis of statements of various persons recorded from 2015 onwards till 29.06.2018, the learned counsel for the opposite parties has submitted that the ED has got ample power to prosecute the petitioner even on the basis of earlier statements. On the question about 'further evidence' which has been procured after filing the original complaint, learned counsel for the opposite parties has got no specific instructions on that point.

20. On being further asked from learned counsel for the opposite parties as to whether any specific allegations of money laundering have been made out against the petitioner in the Supplementary Prosecution Complaint so as to attract the provisions of Section 3 of the Act, 2002, Sri Shiv P. Shukla has submitted that since the petitioner was responsible for correctness of the bills submitted by the Contractor and the maintenance of necessary records in this regard and he was also responsible for implementation of contract provisions which he failed to do so, therefore, he abused his official position and fraudulently prepared the entries of forged bills of Cement, Bitumen and Recron in the relevant Registers, therefore, he is also responsible.

21. Therefore, in view of the above, I am of the considered opinion that the question as to whether the allegation of abuse of official position by not taking proper care and precaution in verifying the entries and bills would be treated as an offence under the Act, 2002, may be considered after exchange of affidavits.

22. I have noted one more thing from Annexure No.2, which is a charge-sheet filed by the C.B.I. before the learned trial court of C.B.I. on 30.10.2013 indicating the culpability of the present petitioner. The relevant portion thereof is at running page 58 of the petition whereby the petitioner has been held responsible for abusing his official position as such a public servant and further allegation is relating to accepting an illegal gratification from the Contractor Sri B.R. Arora.

23. The impugned Supplementary Prosecution Complaint against the petitioner alleges the same allegation as has been levelled by the C.B.I. At running page 133 of the petition, the conclusion of investigation by the ED has been indicated verbatim the same allegation with the same language has been levelled which has been levelled by the C.B.I..

24. If it was an independent investigation by the ED, the finding and observation should be placed in a different manner or atleast the language of the charge-sheet of C.B.I. should not be copied. Prima-facie, it appears that the ED has cut the relevant portion of the charge-sheet of the C.B.I., copied and pasted it in his Supplementary Prosecution Complaint, which may not be appreciated. Besides, if the ED was relying the same allegation of C.B.I charge-sheet which was filed on 30.10.2013, the petitioner should have been made accused in the original complaint which was filed on 30.06.2018. Therefore, prima-facie, it appears that without following the due procedure of law and without giving proper explanation of the aforesaid chain of facts and incidences, the Supplementary Prosecution Complaint has been filed against the petitioner.

25. Since the impugned Supplementary Prosecution Complaint was filed before the learned trial court of ED, therefore, before taking cognizance on the aforesaid Supplementary Prosecution Complaint the provisions of Section 44 (1) (ii) of the Act, 2002 should have been considered. The learned trial court must ask from the prosecution as to what 'further evidence', oral or documentary has been collected after filing the first prosecution complaint to prosecute the petitioner in the present case inasmuch as the further investigation may only be conducted to bring any 'further evidence', oral or documentary, against the accused person.

26. In the present case, the learned trial court of ED vide the impugned order dated 11.08.2021 (Annexure No.6) has taken cognizance against of the second Supplementary Prosecution Complaint and issued summon against the petitioner without adverting to the relevant factual and legal aspects.

27. The Hon'ble Apex Court in re: Pepsi Foods Ltd. & another vs. Special Judicial Magistrate & others reported in (1998) 5 SCC 749 vide para-28 has mandated that the order of learned trial court summoning the accused must reflect that he has applied his mind to the facts of the case as well as law applicable thereto. If the learned trial court summons an accused person without carefully adverting to the facts and law of the case, the said summoning order would be bad in law. For convenience, para-28 reads as under:-

"28. Summoning of an accused in a criminal case is a serious matter. Criminal law cannot be set into motion as a matter of course. it is not that the complainant has to bring only two witnesses to support his allegations in the complaint to have the criminal law set into motion. The order of the magistrate summoning the accused must reflect that he has applied his mind to the facts of the case and the law applicable thereto. He has to examine the nature of allegations made in the complaint and the evidence both oral and documentary in support thereof and would that be sufficient for the complainant to succeed in bringing charge home to the accused. It is not that the Magistrate is a silent spectator at the time of recording of preliminary evidence before summoning of the accused. Magistrate has to carefully scrutinise the evidence brought on record and may even himself put questions to the complainant and his witnesses to elicit answers to find out the truthfulness of the allegations or otherwise and then examine if any offence is prima facie committed by all or any of the accused."

28. In view of the facts and circumstances stated here-in-above, it appears that the matter requires consideration.

29. Let the counter affidavit be filed within a period of three weeks. Rejoinder affidavit,if any, may be filed within a week thereafter.

30. List this petition in the week commencing 29.11.2021 as fresh.

31. Till the next date of listing, the operation and implementation of the impugned cognizance order dated 11.08.2021 (Annexure No.6) taken in Criminal Case No.1154 of 2021 (Directorate of Enforcement, Lucknow vs. Giri Raj Sharma) under Section 3 & 4 of Prevention of Money Laundering Act, 2002 arising out of ECIR/09/PMLA/LZO/2013 pending before the learned Special Court (PMLA), Lucknow, shall remain stayed and the petitioner may not be compelled to appear before the court concerned to participate in the aforesaid criminal proceedings.

[Rajesh Singh Chauhan,J.]

Order Date :- November 2, 2021

Suresh/