Vinay Sureka vs Unknown
2021 Latest Caselaw 5548 Cal

  13,14
     &
    15
08.10.2021

Ct.35 AKG

CRR 2157 OF 2021 With CRR 2158 OF 2021 With CRR 2160 OF 2021 (Through Video Conference)

In Re: - An application under Section 397 read with Sections 401 and 482 of the Code of Criminal Procedure, 1973.

And In the matter of: Vinay Sureka .... Petitioner

Mr. Mahesh Jethmalani, Sr. Adv., Mr. Gunjan Mangla., Adv., Mr. Sabyasachi Banerjee, Adv., Mr. Rajarshee Dutta, Adv., Mr. Mayukh Mukherjee, Adv., Ms. Debjani Chatterjee, Adv., Mr. Shwetaank Nigam, Adv., Mr. Akash Agarwal, Adv., Ms. Pritha Basu, Adv., Mr. Aryaa Chatterjee, Adv.

...For the petitioner in item no. 13.

Mr. Ravi Shankar Prasad, Sr. Adv., Mr. Siddharth Luthra, Sr. Adv., Mr. Sabyasachi Banerjee, Adv., Mr. Asif Ahmed, Adv., Mr. Aditya Raju, Adv., Mr. Rajarshee Dutta, Adv., Mr. Mayukh Mukherjee, Adv., Ms. Debjani Chatterjee, Adv., Mr. Shwetaank Nigam, Adv., Ms. Pritha Basu, Adv., Mr. Aryaa Chatterjee, Adv.

...For the petitioner in item no. 14.

Mr. Amit Desai, Sr. Adv., Mr. Sabyasachi Banerjee, Adv., Mr. Rajarshee Dutta, Adv., Mr. Mayukh Mukherjee, Adv., Ms. Debjani Chatterjee, Adv., Mr. Shwetaank Nigam, Adv., Mr. Akash Agarwal, Adv., Ms. Pritha Basu, Adv., Mr. Aryaa Chatterjee, Adv.

...For the petitioner in item no. 15.

Mr. Vikas Singh, Sr. Adv., Mr. Saubhik Chowdhury, Adv., Mr. Dripto Majumdar, Adv.

...For the complainant in August Agents Limited.

Mr. Ranjan Bachawat, Sr. Adv., Mr. Sayan Roychowdhury, Adv., Mr. Satyaki Mukherjee, Adv.

Mr. Saubhik Chowdhury, Adv., Mr. Dripto Majumdar, Adv.

...For the complainant in Insilco Agents Limited.

Mr. Sekhar Basu, Sr. Adv., Mr. Sandipan Ganguli, Adv., Ms. Somapriya Chowdhury, Adv.

Mr. Sourav Chatterjee, Adv., Mr. Saubhik Chowdhury, Adv., Mr. Dripto Majumdar, Adv.

...For the complainant in Laneseda Agents Limited.

Since similar facts and law points are involved in all the three

applications, they are heard together.

The petitioner has filed the applications for quashing of

proceedings being complaint case no. C-2049 of 2021, C-2050 of 2021

and C-2026 of 2021, under Section 406 of the Indian Penal Code,

1860, pending before the learned Judicial Magistrate, 2nd Court at

Alipore.

The complainants in all three cases are wholly owned

subsidiaries of Vindhya Telelinks Limited a public listed company. The

said complaint suggests that the accused persons are directors or

erstwhile directors of the complainants.

The petitioner/accused has also challenged the identical orders

dated October 1, 2021 and October 4, 2021, passed by the learned

Magistrate in the said complaint cases whereby the learned Magistrate

has issued process against the accused person/petitioner under

Section 406 of the Indian Penal Code, 1860 and also issued search

warrants with a direction upon the police to return the seized

documents to the complainant after verification.

Mr. Ravi Shankar Prasad, learned senior advocate appearing for

the petitioner in CRR No. 2158 of 2021, submits that order of the

learned Magistrate is ex-facie bad in law. The complainant has

suppressed the fact that the committee of administrator pendente-lite

for the estate of late Priyamvada Devi Birla approached the National

Company Law Tribunal, Kolkata Bench, against the complainants and

said Vindhya Telelinks Limited praying, inter alia, for an injunction

restraining them from shifting the registered office of the complainant

company from Birla Building, 9/1, R.N. Mukherjee Road, Kolkata to

any other premises.

In view of the conflicting opinion of the two learned members of

the said Tribunal, the matter was referred to a third learned member

and the said Tribunal is in seisin of the matter.

He, further, points out that the order of the learned Magistrate is

a non-speaking order. The order of the learned Magistrate does not

reflect that there was any inquiry or there was a recording of

satisfaction that the learned Magistrate had reason to believe that in

the facts of the case, issuance of a search warrant was necessary.

Mr. Jethmalani, learned senior advocate, appears for the

petitioner in CRR No. 2157 of 2021. By referring to the paragraphs 22

to 26 of the complaint, he submits that even if the said allegations are

accepted on its face value, the same do not disclose the ingredients of

offence under Section 406 of the Indian Penal Code, 1860. He relies

upon a judgment of the Supreme Court reported at (1977) 1 SCC 163

(Sardar Singh v. State of Haryana) to suggest that Section 406 of

the Indian Penal Code, 1860, can be invoked only if it can be shown

that the accused being in any manner entrusted with the property,

committed breach of trust in respect of that property. In the present

case the complaint case does not suggest that the petitioner

dishonestly misappropriated or converted the property to his own use

or dishonest use or disposed it of. Therefore, the learned Magistrate

was not justified in issuing the process under Section 406 of the

Indian Penal Code, 1860 and the search warrant under Section 94 of

the Code of Criminal Procedure, 1973.

Mr. Amit Desai, learned senior advocate appearing for the

petitioner in CRR No. 2160 of 2021, submits that issuance of search

warrant is a serious matter and a search warrant cannot be issued in

a mechanical manner or by a laconic order. Since the order of issuance

of search warrant is discretionary, the learned Magistrate should give

reason which swayed his discretion in favour of issuance of the search

warrant.

Mr. Desai, further, submits that to issue a search warrant under

Section 94 of the Code of Criminal Procedure, 1973 the learned

Magistrate should first conduct an inquiry before, he can have reasons

to believe that the property in respect of which the search warrant is

sought to be issued is a stolen or objectionable property/article. In this

regard he relies upon a judgment reported at (1998) 1 CHN 185 (Dr.

Satya Narayan Chowdhuri v. State of W.B.).

By referring to Section 457 of the Code of Criminal Procedure,

1973, Mr. Desai submits that the learned Magistrate has committed a

grave error in issuing the search warrant simultaneously with an order

to return the seized articles to the complainant.

Mr. Desai submits that a reading of Section 457 of the Code of

Criminal Procedure, 1973, makes it clear that the police should report

to the Magistrate after the seizure is made and only thereafter the

Magistrate may make such order for disposal of such property or for

delivery of such property to the person entitled to the possession of

such property.

Mr. Siddharth Luthra, learned senior advocate appearing in CRR

No. 2158 of 2021, submits that it is obligatory on the part of the

Magistrate that before summoning the accused residing beyond his

jurisdiction, the learned Magistrate shall inquire into the case himself

or direct the investigation for finding out whether there are sufficient

grounds for proceeding against the accused. The purpose of the

inquiry under Section 202 is to determine whether a prima facie case

is made out, and whether there is a sufficient ground for proceeding

against the accused.

In this case admittedly some of the accused persons are residing

outside the jurisdiction of the Court of the learned Magistrate and

therefore, the learned Magistrate ought to have conducted a

preliminary inquiry before issuance of process.

Mr. Ranjan Bachawat, learned senior advocate appearing in CRR

2157 of 2021 for the complainant/Insilco Agents Limited, submits that

admittedly the registered office of the company has been shifted at 27-

B, Camac Street, 5th Floor, Kolkata-16.

Section 128 of the Companies Act, 2013 provides that every

company shall prepare and keep its registered books of account and

other relevant books and papers at the registered office and its

branches. He submits that the petitioner has failed to obtain any

injunction order from the National Company Law Tribunal, Kolkata

and, therefore, it was obligatory to ensure that the relevant documents

are kept and maintained at the present registered office of the

company. By referring to Sub-section 6 of Section 128 of the

Companies Act, 2013, Mr. Bachawat submits that contravention of the

provisions of Section 128 of the Companies Act, 2013 is a punishable

offence.

Mr. Bachawat, further, submits that Section 405 of the Indian

Penal Code, 1860 is attracted in case of disposal of a property in

violation of any direction of law prescribing the mode in which the

trust is to be discharged. He, further, submits that the order of the

learned Magistrate may not contain sufficient reasons, but the order

has been rightly passed, particularly when it is apparent that the

accused persons are duty bound to ensure that the relevant

documents are kept at the present registered office of the company.

The order of the learned Magistrate in effect has not occasioned any

failure of justice warranting immediate intervention of this Court. The

matters should be heard on merit after granting adequate opportunity

of hearing to the complainants.

Mr. Vikas Singh, learned senior advocate appearing in CRR No.

2158 of 2021, on behalf of the complainant also makes similar

submissions. Mr. Singh also suggests that there is no justification to

grant an ex-parte stay against the order of the learned Magistrate. He

submits that the learned Magistrate has directed that only after proper

verification, the seized articles are to be returned. The learned

Magistrate has also ensured that the nature and character of those

documents are not changed till the disposal of the case. He submits

that the applications should be heard finally on merit without any

interference at this stage.

I have duly considered the arguments advanced by the

respective parties and I am of the, prima facie, opinion that the orders

dated October 1, 2021 and October 4, 2021 are not sustainable in the

eye of law.

The relevant part of the complaint is reproduced below:-

"On several occasions, the complainant company called upon the accused No. 1 and 2 to hand over all records of the complainant company including all Minutes Books, books of accounts, cheque books, common seal and all other assets and properties of the complainant company including the computer(s) containing data of the complainant company and all other assets and properties of the complainant company lying in their power, possession, custody or control and entrusted to them to one Dipankar Chatterjee who has been duly authorised by the complainant company in terms of the resolution passed by the Board of Directors at their meeting held on 10th May, 2021 for shifting/transferring of the records/documents etc. from the erstwhile registered office of the complainant company to the present registered office of the complainant company. There was no authority left for the said accused persons to withhold the records of the complainant company at the office of 9/1 R.N. Mukherjee Road, Kolkata- 700 001 and at other places."

The plain reading of the complaint does not disclose ingredients

of the offences under Section 405 of the Indian Penal Code, 1860 since

it is not the case of the complainant that the accused persons being

entrusted with the relevant documents dishonestly misappropriated or

converted to their own use or dishonestly used or disposed of the said

documents. The allegation is of withholding the documents.

Section 94 of the Code of Criminal Procedure, 1973, mandates

that a search warrant should be preceded by an inquiry conducted by

the Magistrate to arrive at a satisfaction that the property in respect of

which the search warrant is sought to be issued is a stolen property or

an objectionable article. The orders impugned are non-speaking orders

and do not reflect that any such satisfaction has been recorded by the

learned Magistrate.

I am also of the view that without receiving the search report

from the police and without ascertaining the entitlement of the

possession of the documents, the learned Magistrate ought not to have

directed the return of the seized documents to the complainant. The

orders of the learned Magistrate appear to have been passed in

violation of Section 457 of the Code of Criminal Procedure, 1973.

I am also of the opinion that the learned Magistrate was not

justified in issuing the process without embarking upon a preliminary

inquiry against the accused persons who admittedly reside beyond the

jurisdiction of the learned Magistrate.

In view of the aforesaid reasons, all further proceedings in

respect of complaint case nos. C-2049 of 2021, C-2050 of 2021 and C-

2026 of 2021, pending before the learned Judicial Magistrate, 2nd

Court, Alipore, shall remain stayed till three weeks after the ensuing

Puja vacation. The matters will appear one week after the Puja

vacation under the heading "For Orders." The petitioner is directed to

serve a copy of the application upon the opposite parties within a week

from date and file an affidavit-of-service to that effect on the next date

of hearing.

The complainants/investigating agency shall hand over the

seized documents to the Joint Commissioner of Crime, Kolkata Police

within 48 hours from date.

Learned Public Prosecutor shall produce the said seized

documents before this Court on the next date of hearing.

List all three applications one week after the ensuing Puja

vacation under the heading "For Orders."

(Kausik Chanda, J.)