Gujarat High Court

Pravin Natvarlal Modh vs State Of Gujarat on 11 December, 2023

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     R/CR.MA/24314/2015                               JUDGMENT DATED: 11/12/2023

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              IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

       R/CRIMINAL MISC.APPLICATION (FOR QUASHING & SET ASIDE
                     FIR/ORDER) NO. 24314 of 2015

                                  With
               R/CRIMINAL MISC.APPLICATION NO. 24456 of 2015

FOR APPROVAL AND SIGNATURE:


HONOURABLE MR. JUSTICE SANDEEP N. BHATT

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1      Whether Reporters of Local Papers may be allowed                   Yes
       to see the judgment ?

2      To be referred to the Reporter or not ?                            Yes

3      Whether their Lordships wish to see the fair copy                   No
       of the judgment ?

4      Whether this case involves a substantial question                   No
       of law as to the interpretation of the Constitution
       of India or any order made thereunder ?

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                            PRAVIN NATVARLAL MODH
                                    Versus
                          STATE OF GUJARAT & 1 other(s)
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Appearance:
MR RAJESH K KANANI(2157) for the Applicant(s) No. 1
MR. SOAHAM JOSHI, APP for the Respondent(s) No. 1
RULE SERVED BY DS for the Respondent(s) No. 2
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    CORAM:HONOURABLE MR. JUSTICE SANDEEP N. BHATT

                               Date : 11/12/2023
                           COMMON ORAL JUDGMENT

1. Rule returnable forthwith. Learned APP waives

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service of notice of Rule on behalf of respondent No.1 -

State.

2. Since both the present application are arising out of

the same F.I.R. and prayers as well as issues involved

in the present applications are identical in nature, hence,

at the request of learned advocates for the parties, the

matters are taken up for final consideration and

Criminal Misc. Application No.24314 of 2015 is

considered as lead matter and all the matters are heard

together.

3. By way of the present applications, the applicant

seeks to quash and set aside the F.I.R. being I-CR No.163 of 2015 at Navrangpura Police Station,

Ahmedabad, for offences punishable under Sections 171,

191, 192, 196, 199, 200, 403, 405, 409, 415, 416, 420,

463, 464, 467, 468, 474, 477 (A), 120A of the Indian

Penal Code read with Section 85(1) and Section 85(4)

and Section 85(6) of the Gujarat Value Added Tax Act,

2003.

4. Brief facts of the case as per the case of the

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applicant in this application are as such that accused

Nos.1 to 29 are dealers registered under the Gujarat

Value Added Tax Act, 2003. They had purchased

cigarettes from authorized dealers of companies like ITC

Ltd and Godfrey Phillips Ltd. They sold the purchased

goods in the local market without raising bills and then

they created false bills showing Inter-state sale of the

said goods to dealers in Delhi and Haryana. They

obtained false bills and receipts from the transporters

(arrayed as accused number 45 to 54). By using such

false bills of sale and false receipts of transport, they

filed returns under the Vat Act and have claimed

refunds under the said Act and thereby have caused

huge loss to the state exchequer. Hence, the impugned F.I.R. is preferred.

5. Heard Mr.Mihir H. Joshi, the learned senior counsel

appearing for Mr.Rajesh Kanani, the learned advocate for

the applicant in Cr.M.A. No.24314 of 2015 as well as for

Mr.Nandish Thakkar, the learned counsel for the

applicant in Cr.M.A. No.24456 of 2015 and Mr. Soaham

Joshi, the learned Additional Public Prosecutor (APP) for

the respondent No.1 - State.

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6. Mr. Mihir H. Joshi, the learned senior counsel for

the applicant, has submitted that the applicant of

Criminal Misc. Application No.24314 of 2015 is a tax

consultant in the town and has been practicing as an

advocate for more than 35 years. Furthermore, he has

submitted that the applicant of Criminal Misc.

Application No. 24456 of 2015 is also a registered

commercial tax practitioner for the last 15 years.

Furthermore, he has submitted that the allegations

leveled against both the applicants are baseless, and the

role of the applicants is only to represent the clients

based on the documents provided to them by the clients

and to produce the same before the competent authority.

Furthermore, he has submitted that the competent authority is a statutory authority responsible for verifying

the documents and granting the VAT Registration

Number. Furthermore, he has submitted that the

competent authority also physically verifies the original

documents by visiting the clients and thereafter grants

the VAT Registration Number. Furthermore, he has

submitted that at the time of filing the returns, the

respective applicants only receive the account maintained

by the clients in an excel sheet, and the applicants have

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to upload the same on the Government Portal.

Furthermore, he has submitted that the respective

applicants are not the beneficiary in the entire

transaction, as even as per the case of the prosecution,

the entire refund amount is directly credited to the

accounts of the clients through ECS after due cross-

verification with the tax authority based outside the

Gujarat State, where the transaction is shown.

Furthermore, he has submitted that the respective

applicants have merely represented a few accused

persons, out of which only three are allegedly to have

received the refund from the competent authority.

Furthermore, he has submitted that the respective

applicants have not forged any document nor committed any breach of any offence of criminal breach of trust

under Sections 405, 406, 415 & 420 of the Indian Penal

Code. Furthermore, he has submitted that merely

representing the clients by consultants/lawyers would not

amount to any offence, as laid down by the Hon'ble

Apex Court in the case of C.B.I., Hyderabad versus K.

Narayan Rao, reported in 2013 (3) GLH 2013.

Furthermore, he has submitted that the respective

applicants are merely a commercial tax practitioner and

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an advocate appearing before the competent authority as

enumerated under Section 81 of the VAT Act, 2003.

Therefore, considering the role attributed to the

applicant(s), no offence is made out. Therefore, this is a

fit case where the Court should exercise the power under

Section 482 of the Cr.P.C., by considering the judgment

of the Hon'ble Apex Court in the case of State of

Haryana V/s Bhajan Lal reported in AIR 1992 SC 604,

and other judgments on this aspect in favor of the

respective applicants, who are otherwise not benefited

from the said transaction, or there is no direct

involvement of the applicant, which involves the

applicant(s) in any offence.

7. Per contra, the learned APP has submitted that prima facie, the involvement of the respective applicants in the present offence is made out. Furthermore, he has

submitted that although the respective applicants are

practicing advocates, but the fact remains that the party,

to whom the respective applicants are representing has

taken advantage and has acted in a manner by which

the loss is caused to the Government Exchequer.

Therefore, the involvement of the respective applicants

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cannot be taken in isolation. Furthermore, upon

instructions from the concerned officers of the VAT

Department as well as the Investigating Officer, who

were present, he has submitted that neither of the

applicants has received any direct benefit, nor have they

received any refund, nor is it found that the respective

applicants have created any forged or fabricated

document. Therefore, he has submitted that considering

the totality of the facts and circumstances of the case,

this Court may pass an appropriate order in accordance

with the law as a prima facie case is made out.

8.1. I have considered the rival submissions made at the

bar by the respective parties. It is necessary to refer to certain facts; the applicants are practicing advocates as

well as registered commercial tax practitioners/tax

consultants since last 35 and 15 years, respectively, in

Criminal Misc. Application No. 24314 of 2015 and

Criminal Misc. Application No. 24456 of 2015, and they

have a good unblemished career.

8.2. Additionally, if the allegations levelled against the

applicants are considered from the impugned F.I.R., then

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the role of the applicants is only to the extent that they

have represented the clients based on the documents

provided to them by the clients and produced the same

before the competent authority. It transpires that it is

the duty of the competent authority to verify the

documents and to grant the VAT registration number. It

also transpires that the competent authority physically

verifies the original documents by visiting to the clients

and thereafter, grants the VAT registration number. It

further transpires that even upon filing the returns, the

applicants only receive the accounts maintained by the

accountant of the clients in an excel sheet, and the

applicants have to upload the same on the Government

Portal.

8.3. It also transpires that the applicants are not

beneficiaries in the entire transaction, as even in the

case of the prosecution, the entire refund amount is

directly credited to the accounts of the clients through

ECS after due cross-verification with Tax Authorities

based outside Gujarat State, where the transaction is

shown. Additionally, it transpires that the respective

applicants have represented very few accused persons.

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Records and submissions made at the bar also indicate

that the respective applicants have not forged any

document nor committed any offence of criminal breach

of trust, much less any offence under the Gujarat Value

Added Tax Act, 2003. It also transpires that it is not

the case of the prosecution that respective applicants

have played any role in the offence as alleged in the

F.I.R.

8.4. It is relevant to note that merely representing the

clients by a consultant/lawyer would not amount to any

offence, as per the law laid down by the Hon'ble Apex

Court in the case of K. Narayan Rao (supra). In the

present case, considering the role of the respective applicants, the process prescribed under the law is

required to be followed, by which any amount of refund

of the client is directly credited to the bank account of

the client through ECS after due verification with the

tax authorities.

8.5. It is relevant to refer the provisions of Sections

171, 191, 192, 196, 199, 200, 403, 405, 409, 415, 416,

420, 463, 464, 467, 468, 474, 477 (A), 120A of the

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Indian Penal Code read with Section 85(1) and Section

85(4) and Section 85(6) of the Gujarat Value Added Tax

Act, 2003 under the F.I.R. is filed, as under:

"Section 171 in The Indian Penal Code:-

171. Wearing garb or carrying token used by public servant with fraudulent intent.--Whoever, not belonging to a certain class of public servants, wears any garb or carries any token resembling any garb or token used by that class of public servants, with the intention that it may be believed, or with the knowledge that it is likely to be believed, that he belongs to that class of public servants, shall be punished with imprisonment of either description for a term which may extend to three months, or with fine which may extend to two hundred rupees, or with both.

Section 191 in The Indian Penal Code:-

191. Giving false evidence.--Whoever, being legally bound by an oath or by an express provision of law to state the truth, or being bound by law to make a declaration upon any subject, makes any statement which is false, and which he either knows or believes to be false or does not believe to be true, is said to give false evidence. Explanation 1.--A statement is

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within the meaning of this section, whether it is made verbally or otherwise. Explanation 2.--A false statement as to the belief of the person attesting is within the meaning of this section, and a person may be guilty of giving false evidence by stating that he believes a thing which he does not believe, as well as by stating that he knows a thing which he does not know. Illustrations

(a) A, in support of a just claim which B has against Z for one thousand rupees, falsely swears on a trial that he heard Z admit the justice of B's claim. A has given false evidence.

(b) A, being bound by an oath to state the truth, states that he believes a certain signature to be the handwriting of Z, when he does not believe it to be the handwriting of Z. Here A states that which he knows to be false, and therefore gives false evidence.

(c) A, knowing the general character of Z's handwriting, states that he believes a certain signature to be the handwriting of Z; A in good faith believing it to be so. Here A's statement is merely as to his belief, and is true as to his belief, and therefore, although the signature may not be the handwriting of Z, A has not given false evidence.

(d) A, being bound by an oath to state the truth, states that he knows that Z was at a particular place on a particular day, not knowing anything upon the

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subject. A gives false evidence whether Z was at that place on the day named or not.

(e) A, an interpreter or translator, gives or certifies as a true interpretation or translation of a statement or document which he is bound by oath to interpret or translate truly, that which is not and which he does not believe to be a true interpretation or translation. A has given false evidence.

Section 192 in The Indian Penal Code:-

192. Fabricating false evidence.--Whoever causes any circumstance to exist or 1[makes any false entry in any book or record, or electronic record or makes any document or electronic record containing a false statement], intending that such circumstance, false entry or false statement may appear in evidence in a judicial proceeding, or in a proceeding taken by law before a public servant as such, or before an arbitrator, and that such circumstance, false entry or false statement, so appearing in evidence, may cause any person who in such proceeding is to form an opinion upon the evidence, to entertain an erroneous opinion touching any point material to the result of such proceeding, is said "to fabricate false evidence".

Illustrations

(a) A, puts jewels into a box belonging to Z, with the intention that they may be found in that box, and

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that this circumstance may cause Z to be convicted of theft. A has fabricated false evidence.

(b) A makes a false entry in his shop-book for the purpose of using it as corroborative evidence in a Court of Justice. A has fabricated false evidence.

(c) A, with the intention of causing Z to be convicted of a criminal conspiracy, writes a letter in imitation of Z's handwriting, purporting to be addressed to an accomplice in such criminal conspiracy, and puts the letter in a place which he knows that the officers of the Police are likely to search. A has fabricated false evidence.

Section 196 in The Indian Penal Code:-

196. Using evidence known to be false.--Whoever corruptly uses or attempts to use as true or genuine evidence any evidence which he knows to be false or fabricated, shall be punished in the same manner as if he gave or fabricated false evidence.

Section 199 in The Indian Penal Code:-

199. False statement made in declaration which is by law receivable as evidence.--Whoever, in any declaration made or subscribed by him, which declaration any Court of Justice, or any public servant or other person, is bound or authorised by law to receive as evidence of any fact, makes any statement

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which is false, and which he either knows or believes to be false or does not believe to be true, touching any point material to the object for which the declaration is made or used, shall be punished in the same manner as if he gave false evidence.

Section 200 in The Indian Penal Code:-

200. Using as true such declaration knowing it to be false.--Whoever corruptly uses or attempts to use as true any such declaration, knowing the same to be false in any material point, shall be punished in the same manner as if he gave false evidence. Explanation.

--A declaration which is inadmissible merely upon the ground of some informality, is a declaration within the meaning of sections 199 to 200.

Section 403 in The Indian Penal Code:-

403. Dishonest misappropriation of property.--Whoever dishonestly mis-appropriates or converts to his own use any movable property, shall be punished with imprisonment of either description for a term which may extend to two years, or with fine, or with both.

Illustrations

(a) A takes property belonging to Z out of Z's possession, in good faith, believing, at any time when he takes it, that the property belongs to himself. A is not guilty of theft; but if A, after discovering his

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mistake, dishonestly appropriates the property to his own use, he is guilty of an offence under this section.

(b) A, being on friendly terms with Z, goes into Z's library in Z's absence, and takes away a book without Z's express consent. Here, if A was under the impression that he had Z's implied consent to take the book for the purpose of reading it, A has not committed theft. But, if A afterwards sells the book for his own benefit, he is guilty of an offence under this section.

(c) A and B, being joint owners of a horse, A takes the horse out of B's possession, intending to use it. Here, as A has a right to use the horse, he does not dishonestly misappropriate it. But, if A sells the horse and appropriates the whole proceeds to his own use, he is guilty of an offence under this section. Explanation I.--A dishonest misappropriation for a time only is a misappropriation with the meaning of this section. Illustration A finds a Government promissory note belonging to Z, bearing a blank endorsement. A, knowing that the note belongs to Z, pledges it with a banker as a security for a loan, intending at a future time to restore it to Z. A has committed an offence under this section. Explanation 2.--A person who finds property not in the possession of any other person, and takes such property for the purpose of protecting if for, or of restoring it to, the owner does not take or

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misappropriate it dishonestly, and is not guilty of an offence; but he is guilty of the offence above defined, if he appropriates it to his own use, when he knows or has the means of discovering the owner, or before he has used reasonable means to discover and give notice to the owner and has kept the property a reasonable time to enable the owner to claim it. What are reasonable means or what is a reasonable time in such a case, is a question of fact. It is not necessary that the finder should know who is the owner of the property, or that any particular person is the owner of it; it is sufficient if, at the time of appropriating it, he does not believe it to be his own property, or in good faith believe that the real owner cannot be found. Illustrations

(a) A finds a rupee on the high road, not knowing to whom the rupee belongs. A picks up the rupee. Here A has not committed the offence defined in this section.

(b) A finds a letter on the road, containing a bank note. From the direction and contents of the letter he learns to whom the note belongs. He appropriates the note. He is guilty of an offence under this section.

(c) A finds a cheque payable to bearer. He can form no conjecture as to the person who has lost the cheque. But the name of the person, who has drawn the cheque, appears. A knows that this person can

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direct him to the person in whose favour the cheque was drawn. A appropriates the cheque without attempting to discover the owner. He is guilty of an offence under this section.

(d) A sees Z drop his purse with money in it. A picks up the purse with the intention of restoring it to Z, but afterwards appropriates it to his own use. A has committed an offence under this section.

(e) A finds a purse with money, not knowing to whom it belongs; he afterwards discovers that it belongs to Z, and appropriates it to his own use. A is guilty of an offence under this section.

(f) A finds a valuable ring, not knowing to whom it belongs. A sells it immediately without attempting to discover the owner. A is guilty of an offence under this section. CLASSIFICATION OF OFFENCE Punishment--Imprisonment for 2 years, or fine, or both

--Non-cognizable--Bailable--Triable by any Magistrate-- Compoundable by the owner of the property misappropriated with the permission of the court. comments Dishonest misappropriation or conversion of property The words 'converts to his own use' necessarily connote the use or dealing with the property in derogation of the rights of the owner; Ramaswami Nadar v. State of Madras, AIR 1958 SC

56. Ingreidents It has been held that the word 'dishonestly' and 'misappropriate' are necessary

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ingredients of an offence under section 403. Any dispute being about recovery of money is purely of civil nature. Hence a criminal complaint regarding such a matter is not maintainable, U. Dhar v. State of Jharkhand, AIR 2003 SC 974.

Section 405 in The Indian Penal Code:-

405. Criminal breach of trust.--Whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied, which he has made touching the discharge of such trust, or wilfully suffers any other person so to do, commits "criminal breach of trust". 1[Explanation 2[1].--A person, being an employer 3[of an estab-

lishment whether exempted under section 17 of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (19 of 1952), or not] who deducts the employee's contribution from the wages payable to the employee for credit to a Provident Fund or Family Pension Fund established by any law for the time being in force, shall be deemed to have been entrusted with the amount of the contribution so deducted by him and if he makes default in the payment of such

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contribution to the said Fund in violation of the said law, shall be deemed to have dishonestly used the amount of the said contribution in violation of a direction of law as aforesaid.] 4[Explanation 2.--A person, being an employer, who deducts the employees' contribution from the wages payable to the employee for credit to the Employees' State Insurance Fund held and administered by the Employees' State Insurance Corporation established under the Employees' State Insurance Act, 1948 (34 of 1948), shall be deemed to have been entrusted with the amount of the contribution so deducted by him and if he makes default in the payment of such contribution to the said Fund in violation of the said Act, shall be deemed to have dishonestly used the amount of the said contribution in violation of a direction of law as aforesaid.] Illustrations

(a) A, being executor to the will of a deceased person, dishonestly disobeys the law which directs him to divide the effects according to the will, and appropriate them to his own use. A has committed criminal breach of trust.

(b) A is a warehouse-keeper. Z going on a journey, entrusts his furniture to A, under a contract that it shall be returned on payment of a stipulated sum for warehouse room. A dishonestly sells the goods. A has committed criminal breach of trust.

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(c) A, residing in Calcutta, is agent for Z, residing at Delhi. There is an express or implied contract between A and Z, that all sums remitted by Z to A shall be invested by A, according to Z's direction. Z remits a lakh of rupees to A, with directions to A to invest the same in Company's paper. A dishonestly disobeys the direction and employs the money in his own business. A has committed criminal breach of trust.

(d) But if A, in the last illustration, not dishonestly but in good faith, believing that it will be more for Z's advantage to hold shares in the Bank of Bengal, disobeys Z's directions, and buys shares in the Bank of Bengal, for Z, instead of buying Company's paper, here, though Z should suffer loss, and should be entitled to bring a civil action against A, on account of that loss, yet A, not having acted dishonestly, has not committed criminal breach of trust.

(e) A, a revenue-officer, is entrusted with public money and is either directed by law, or bound by a contract, express or implied, with the Government, to pay into a certain treasury all the public money which he holds. A dishonestly appropriates the money. A has committed criminal breach of trust.

(f) A, a carrier, is entrusted by Z with property to be carried by land or by water. A dishonestly misappropriates the property. A has committed criminal breach of trust. Comments Criminal Conspiracy

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Sanction for prosecution is not necessary if a public servant is charged for offence of entering into a criminal conspiracy for committed breach of trust; State of Kerala v. Padmanabham Nair, 1999 Cr LJ 3696 (SC). Criminal breach of trust: Meaning and extent It must be proved that the beneficial interest in the property in respect of which the offence is alleged to have been committed was vested in some person other than the accused, and that the accused held that property on behalf of that person. A relationship is created between the transferor and transferee, whereunder the transferor remains the owner of the property and the transferee has legal custody of the property for the benefit of the transferor himself or transferee has only the custody of the property for the benefit of the transferor himself or someone else. At best, the transferee obtains in the property entrusted to him only special interest limited to claim for his charges in respect of its safe retention, and under no circumstances does he acquire a right to dispose of that property in contravention of the condition of the entrustment; Jaswantrai Manilal Akhaney v. State of Bombay, AIR 1956 SC 575. Entrustment The word entrusted in the section is very important unless there is entrustment, there can be no offence under the section; Ramaswami Nadar v. State of Madras, AIR 1958 SC 56.

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Section 409 in The Indian Penal Code:-

409. Criminal breach of trust by public servant, or by banker, merchant or agent.--Whoever, being in any manner entrusted with property, or with any dominion over property in his capacity of a public servant or in the way of his business as a banker, merchant, factor, broker, attorney or agent, commits criminal breach of trust in respect of that property, shall be punished with 1[imprisonment for life], or with imprisonment of either description for a term which may extend to ten years, and shall also be liable to fine.

Section 415 in The Indian Penal Code:-

415. Cheating.--Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, mind, reputation or property, is said to "cheat". Explanation.--A dishonest concealment of facts is a deception within the meaning of this section.

Illustrations

(a) A, by falsely pretending to be in the Civil Service,

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intentionally deceives Z, and thus dishonestly induces Z to let him have on credit goods for which he does not mean to pay. A cheats.

(b) A, by putting a counterfeit mark on an article, intentionally deceives Z into a belief that this article was made by a certain celebrated manufacturer, and thus dishonestly induces Z to buy and pay for the article. A cheats.

(c) A, by exhibiting to Z a false sample of an article, intentionally deceives Z into believing that the article corresponds with the sample, and thereby, dishonestly induces Z to buy and pay for the article. A cheats.

(d) A, by tendering in payment for an article a bill on a house with which A keeps no money, and by which A expects that the bill will be dishonored, intentionally deceives Z, and thereby dishonestly induces Z to deliver the article, intending not to pay for it. A cheats.

(e) A, by pledging as diamonds article which he knows are not diamonds, intentionally deceives Z, and thereby dishonestly induces Z to lend money. A cheats.

(f) A intentionally deceives Z into a belief that A means to repay any money that Z may lend to him and thereby dishonestly induces Z to lend him money. A not intending to repay it. A cheats.

(g) A intentionally deceives Z into a belief that A means to deliver to Z a certain quantity of indigo

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plant which he does not intend to deliver, and thereby dishonestly induces Z to advance money upon the faith of such delivery. A cheats; but if A, at the time of obtaining the money, intends to deliver the indigo plant, and afterwards breaks his contract and does not deliver it, he does not cheat, but is liable only to a civil action for breach of contract.

(h) A intentionally deceives Z into a belief that A has performed A's part of a contract made with Z, which he has not performed, and thereby dishonestly induces Z to pay money. A cheats.

(i) A sells and conveys an estate to B. A, knowing that in consequence of such sale he has no right to the property, sells or mortgages the same to Z, without disclosing the fact of the previous sale and conveyance to B, and receives the purchase or mortgage money from Z. A cheats.

Section 416 in The Indian Penal Code-

416. Cheating by personation.--A person is said to "cheat by personation" if he cheats by pretending to be some other person, or by knowingly substituting one person for another, or representing that he or any other person is a person other than he or such other person really is. Explanation.--The offence is committed whether the individual personated is a real or imaginary person. Illustration

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(a) A cheats by pretending to be a certain rich banker of the same name. A cheats by personation.

(b) A cheats by pretending to be B, a person who is deceased. A cheats by personation.

Section 420 in The Indian Penal Code:-

420. Cheating and dishonestly inducing delivery of property.--Whoever cheats and thereby dishonestly induces the person deceived to deliver any property to any person, or to make, alter or destroy the whole or any part of a valuable security, or anything which is signed or sealed, and which is capable of being converted into a valuable security, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine.

Section 463 in The Indian Penal Code:-

463. Forgery.-- 340 [Whoever makes any false documents or false electronic record or part of a document or electronic record, with intent to cause damage or injury], to the public or to any person, or to support any claim or title, or to cause any person to part with property, or to enter into any express or implied contract, or with intent to commit fraud or that fraud may be committed, commits forgery.

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Section 464 in The Indian Penal Code:-

464 Making a false document. -- 341 [A person is said to make a false document or false electronic record-- First --Who dishonestly or fradulently--

(a) makes, signs, seals or executes a document or part of a document;

(b) makes or transmits any electronic record or part of any electronic record;

(c) affixes any 342 [electronic signature] on any electronic record;

(d) makes any mark denoting the execution of a document or the authenticity of the 342 [electronic signature], with the intention of causing it to be believed that such document or part of document, electronic record or 342 [electronic signature] was made, signed, sealed, executed, transmitted or affixed by or by the authority of a person by whom or by whose authority he knows that it was not made, signed, sealed, executed or affixed; or Secondly --Who, without lawful authority, dishonestly or fraudulently, by cancellation or otherwise, alters a document or an electronic record in any material part thereof, after it has been made, executed or affixed with 342 [electronic signature] either by himself or by any other person, whether such person be living or dead at the time of such alteration; or Thirdly --Who dishonestly or fraudulently

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causes any person to sign, seal, execute or alter a document or an electronic record or to affix his 342 [electronic signature] on any electronic record knowing that such person by reason of unsoundness of mind or intoxication cannot, or that by reason of deception practised upon him, he does not know the contents of the document or electronic record or the nature of the alteration.] Illustrations

(a) A has a letter of credit upon B for rupees 10,000 written by Z. A, in order to defraud B, adds a cipher to the 10,000, and makes the sum 1,00,000 intending that it may be believed by B that Z so wrote the letter. A has committed forgery.

(b) A, without Z 's authority, affixes Z 's seal to a document purporting to be a conveyance of an estate from Z to A, with the intention of selling the estate to B, and thereby of obtaining from B the purchase- money. A has committed forgery.

(c) A picks up a cheque on a banker signed by B, payable to bearer, but without any sum having been inserted in the cheque. A fraudulently fills up the cheque by inserting the sum of ten thousand rupees. A commits forgery.

(d) A leaves with B, his agent, a cheque on a banker, signed by A, without inserting the sum payable and authorizes B to fill up the cheque by inserting a sum not exceeding ten thousand rupees for the purpose of

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making certain payment. B fraudulently fills up the cheque by inserting the sum of twenty thousand rupees. B commits forgery.

(e) A draws a bill of exchange on himself in the name of B without B 's authority, intending to discount it as a genuine bill with a banker and intending to take up the bill on its maturity. Here, as A draws the bill with intent to deceive the banker by leading him to suppose that he had the security of B, and thereby to discount the bill, A is guilty of forgery.

(f) Z 's will contains the these words--"I direct that all my remaining property be equally divided between A, B and C ." A dishonestly scratches out B 's name, intending that it may be believed that the whole was left to himself and C. A has committed forgery.

(g) A endorses a Government promissory note and makes it payable to Z or his order by writing on the bill the words "Pay to Z or his order" and signing the endorsement. B dishonestly erases the words "Pay to Z or his order", and thereby converts the special endorsement into a blank endorsement. B commits forgery.

(h) A sells and conveys an estate to Z. A afterwards, in order to defraud Z of his estate, executes a conveyance of the same estate to B, dated six months earlier than the date of the conveyance to Z, intending it to be believed that he had conveyed the estate to B

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before he conveyed it to Z. A has committed forgery.

(i) Z dictates his will to A. A intentionally writes down a different legatee from the legatee named by Z, and by representing to Z that he has prepared the will according to his instructions, induces Z to sign the will. A has committed forgery.

(j) A writes a letter and signs it with B 's name without B 's authority, certifying that A is a man of good character and in distressed circumstances from unforeseen misfortune, intending by means of such letter to obtain alms from Z and other persons. Here, as A made a false document in order to induce Z to part with property. A has committed forgery.

(k) A without B 's authority writes a letter and signs it in B 's name certifying to A 's character, intending thereby to obtain employment under Z. A has committed forgery in as much as he intended to deceive Z by the forged certificate, and thereby to induce Z to enter into an express or implied contract for service. Explanation 1. --A man's signature of his own name may amount to forgery. Illustrations

(a) A signs his own name to a bill of exchange, intending that it may be believed that the bill was drawn by another person of the same name. A has committed forgery.

(b) A writes the word "accepted" on a piece of paper and signs it with Z 's name, in order that B may

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afterwards write on the paper a bill of exchange drawn by B upon Z, and negotiate the bill as though it had been accepted by Z. A is guilty of forgery; and if B, knowing the fact, draws the bill upon the paper pursuant to A 's intention, B is also guilty of forgery.

(c) A picks up a bill of exchange payable to the order of a different person of the same name. A endorses the bill in his own name, intending to cause it to be believed that it was endorsed by the person whose order it was payable; here A has committed forgery.

(d) A purchases an estate sold under execution of a decree against B. B, after the seizure of the estate, in collusion with Z, executes a lease of the estate of Z at a nominal rent and for a long period and dates the lease six months prior to the seizure, with intent to defraud A, and to cause it to be believed that the lease was granted before the seizure. B, though he executes the lease in his own name, commits forgery by antedating it.

(e) A, a trader, in anticipation of insolvency, lodges effects with B for A 's benefit, and with intent to defraud his creditors; and in order to give a colour to the transaction, writes a promissory note binding himself to pay to B a sum for value received, and antedates the note, intending that it may be believed to have been made before. A was on the point of insolvency. A has committed forgery under the first

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head of the definition. Explanation 2. --The making of a false document in the name of a fictitious person, intending it to be believed that the document was made by a real person, or in the name of a deceased person, intending it to be believed that the document was made by the person in his lifetime, may amount to forgery. Illustration A draws a bill of exchange upon a fictitious person, and fraudulently accepts the bill in the name of such fictitious person with intent to negotiate it. A commits forgery. 343 [ Explanation

3.-- For the purposes of this section, the expression "affixing 2 [electronic signature]" shall have the meaning assigned to it in clause (d) of sub-section (1) of section 2 of the Information Technology Act, 2000.]

Section 467 in The Indian Penal Code:-

467. Forgery of valuable security, will, etc.--Whoever forges a document which purports to be a valuable security or a will, or an authority to adopt a son, or which purports to give authority to any person to make or transfer any valuable security, or to receive the principal, interest or dividends thereon, or to receive or deliver any money, movable property, or valuable security, or any document purporting to be an acquittance or receipt acknowledging the payment of money, or an acquittance or receipt for the delivery of any movable property or valuable security, shall be

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punished with 1[imprisonment for life], or with imprisonment of either description for a term which may extend to ten years, and shall also be liable to fine.

Section 468 in The Indian Penal Code:-

468. Forgery for purpose of cheating.--Whoever commits forgery, intending that the 1[document or electronic record forged] shall be used for the purpose of cheating, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine.

Section 474 in The Indian Penal Code:-

474. Having possession of document described in section 466 or 467, knowing it to be forged and intending to use it as genuine.--1[Whoever has in his possession any document or electronic record, knowing the same to be forged and intending that the same shall fraudulently or dishonestly be used as genuine, shall, if the document or electronic record is one of the description mentioned in section 466 of this Code], be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine; and if the document is one of the description mentioned in section 467, shall be punished with 2[imprisonment for life], or with

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imprisonment of either description, for a term which may extend to seven years, and shall also be liable to fine.

Section 477A in The Indian Penal Code:- 356 [477A. Falsification of accounts.--Whoever, being a clerk, officer or servant, or employed or acting in the capacity of a clerk, officer or servant, wilfully, and with intent to defraud, destroys, alters, mutilates or falsifies any 2[book, electronic record, paper, writing], valuable security or account which belongs to or is in the possession of his employer, or has been received by him for or on behalf of his employer, or wilfully, and with intent to defraud, makes or abets the making of any false entry in, or omits or alters or abets the omission or alteration of any material particular from or in, any such 2[book, electronic record, paper, writing], valuable security or account, shall be punished with imprisonment of either description for a term which may extend to seven years, or with fine, or with both. Explanation.--It shall be sufficient in any charge under this section to allege a general intent to defraud without naming any particular person intended to be defrauded or specifying any particular sum of money intended to be the subject of the fraud, or any particular day on which the offence was committed.]

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Section 120B in The Indian Penal Code:-

120B. Punishment of criminal conspiracy.--

(1) Whoever is a party to a criminal conspiracy to commit an offence punishable with death, 2[imprisonment for life] or rigorous imprisonment for a term of two years or upwards, shall, where no express provision is made in this Code for the punishment of such a conspiracy, be punished in the same manner as if he had abetted such offence.

(2) Whoever is a party to a criminal conspiracy other than a criminal conspiracy to commit an offence punishable as aforesaid shall be punished with imprisonment of either description for a term not exceeding six months, or with fine or with both.]

Section 85(1) of the Value Added Tax, 2003:-

85. Offences and penalties. -

(1) Whoever-

(a) not being a registered dealer, falsely represents that he is or was a registered dealer at the time when he sells or purchases goods;

(b) knowingly furnishes a false return where the amount of tax, which could have been evaded if the false had been accepted as true, exceeds Rs. 1000;

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(c) knowingly produces before the Commissioner, false tax invoice, bill, voucher, cash-memorandum, declaration, certificate or other document for claiming deduction or tax credit, the value of which exceeds Rs.

(d) fails to pay tax as per the returns filed by him;

(e) knowingly keeps or produces false account;

(f) issues to any person certificate or declaration under this Act, or a invoice, bill, cash-memorandum, voucher or other document which he knows or has reason to believe to be false;

(g) wilfully attempts, in any manner whatsoever, to evade tax leviable under this Act;

shall on conviction, be punished with imprisonment for a term which [may extend to six months or with fine not exceeding rupees twenty thousand or with both. Provided that in absence of special and adequate reasons to the contrary to be mentioned in the judgement of the Court, such imprisonment shall not be less than one month and such fine shall not be less than rupees ten thousand.]

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Section 85(4) of the Value Added Tax, 2003:-

(4) Whoever aids or abets any person in commission of an offence specified in subsection (1) or (2) shall, on conviction, be punished with imprisonment for term which may extend to six months or with fine exceeding rupees twenty thousand or with both.]

Section 85(6) of the Value Added Tax, 2003:-

(6) Where a dealer is guilty of an offence specified in sub-sections (1) and (2), the person to be manager of the business of such dealer under section 65 shall also be deemed to be guilty of such offence, unless the proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission thereof.

8.6. Considering the above-stated discussions and taking

into account the provisions of the law, prima facie, it is

found that there is no direct involvement of the

respective applicants, except the services rendered as

consultants to the parties for filing the returns. This

cannot be considered as the respective applicants having

committed any offence in view of the law laid down by

the Hon'ble Apex Court in the case of K. Narayan Rao

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(supra).

8.7. It is also relevant case law on this issue is

required to be referred as under:

 The Hon'ble Uttarakhand High Court in the case of

Vijendra Chaudhary Vs. State of Uttaranchal and anther,

- 2010 (2) UC 1281, held that charges cannot be

sustained and the proceedings against the advocate

should be quashed and set aside where an advocate

appeared on behalf of the client, did not get any

financial benefit and no other evidences were found to be

involved in any conspiracy. Relevant para of the decision

is as under:

"9. On careful consideration of the rival submissions of the learned counsel for the parties, I am of the view that Vijendra Chaudhary appeared as advocate on behalf of Ajit Singh. Initially, Ajit Singh had produced death certificate before the Naib Tehsildar, which was found to be not issued by the competent authority. Thereafter, he filed appeal before the Assistant Collector and in the appeal the death certificate was produced which is shown to be issued by Block Development Officer, however, on enquiry it was found

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to be forged.

10. Except the statement of Ajit Singh there is no other evidence on record that alleged death certificate had been forged by the applicant. Petitioner being advocate, he advises his client and if any forged document is handed over to him by his client, the advocate cannot be held responsible. Simply because the alleged death certificate had been produced by advocate before the court, it does not prove that the advocate, who produced it, had committed the offence. Moreover, the advocate would not have been the beneficiary if the said certificate was accepted or rejected. It would ultimately be the person who would have received some wrongful gain by producing it."

 The Hon'ble Punjab and Haryana High Court in the

case of Attar Chand Vs. State of Punjab - 1986 CRI.L.J.

1034, held that the advocates should not be held

responsible for conspiracy merely identification of person

before a Court or authority unless there should be

evidence of some antecede behavior showing some concern

or connection between the lawyer and the principal

accused. In the present case, the Applicant appeared

before the assessing officer and submitted the documents

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provided by the clients at the time of hearing. The FIR

has not alleged that the applicant was directly or

indirectly part of creation or fabrication of the alleged

documents.

 The Hon'ble Supreme Court in the case of Central

Bureau of Investigation Vs. K. Narayan Rao 2012 (9)

SCC 512 held that in the absence of any direct material,

the advocate should not be implicated as one of the

conspirators of the offences punishable under IPC. The

Hon'ble Supreme Court relied upon the findings given by

the Hon'ble High Court and held that the advocate

cannot be held liable for criminal proceedings merely

because his opinion was not acceptable to the authority. More particularly in the absence of any tangible evidence

that he was associated with the other conspirators.

 The Hon'ble Gujarat High Court in the case of

Rameshbhai Vallabhbhai Korat Vs. State of Gujarat in

Special Criminal Application No. 102/2012 after relying

upon the decision of K. Narayan Rao case (Supra) held

that the advocate should not be liable for forgery or

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cheating in a case when it was found that title clearance

report given by Advocate was not correct. It was held

that the advocate had not played any role in preparing

Power of Attorney or other documents.

8.8. Further, it will also be fruitful to mention the

judgment of the Hon'ble Supreme Court in the case of

State of Haryana V/s Bhajan Lal reported in AIR 1992

SC 604, wherein the Hon'ble Supreme Court has

observed thus -

"In the backdrop of the interpretation of the various relevant provisions of the Code under Ch.XIV and of the principles of law enunciated by this court in a series of decisions relating to the exercise of the extraordinary power under Art.226 or the inherent powers under sec.482 of the Code which we have extracted and reproduced above, we give the following categories of cases by way of illustration wherein such power could be exercised either to prevent abuse of the process of any court or otherwise to secure the ends of justice, though it may not be possible to lay down

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any precise, clearly defined and sufficiently channelised and inflexible guidelines or rigid formulae and to give an exhaustive list of myriad kinds of cases wherein such power should be exercised.

(1) Where the allegations made in the first information report or the complaint, even if they are taken at their face value and accepted in their entirety do not prima facie constitute any offence or make out a case against the accused.

(2) Where the allegations in the first information report and other materials, if any, accompanying the FIR do not disclose a cognizable offence, justifying an investigation by police officers under sec.156(1) of the Code except under an order of a Magistrate within the purview of sec.155(2) of the Code.



                     (3)    Where     the     uncontroverted           allegations
                     made    in     the   FIR       or   complaint       and      the

evidence collected in support of the same do not disclose the commission of any offence and make out a case against the accused.

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(4) Where, the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated under sec.156(2) of the Code.

(5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused.

(6) Where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the concerned Act, providing efficacious redress for the grievance of the aggrieved party.

(7) Where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an

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ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge."

8.9. It is also relevant to refer to the judgment of the

Hon'ble Apex Court in the case of Inder Mohan Goswami

and Another versus State of Uttaranchal reported in

(2007) 12 SCC 1, more particularly para : 23 & 24

thereof, which read as under :

"23. This Court in a number of cases has laid down the scope and ambit of courts' powers under Sec. 482 CrPC. Every High Court has inherent power to act ex debito justitiae to do real and substantial justice, for the administration of which alone it exists, or to prevent abuse of the process of the court. Inherent power under Sec. 482 CrPC can be exercised:

[(i) to give effect to an order under the Code;]

[(ii) to prevent abuse of the process of court, and]

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[(iii) to otherwise secure the ends of justice.]

24. Inherent powers under Sec. 482 CrPC though wide have to be exercised sparingly, carefully and with great caution and only when such exercise is justified by the tests specifically laid down in this section itself'.

Authority of the court exists for the advancement of justice. If any abuse of the process leading to injustice is brought to the notice of the court, then the court would be justified in preventing injustice by invoking inherent powers in absence of specific provisions in the statute. Discussion of decided cases."

8.10. In light of the above, in the afore-captioned

two applications, these are the fit cases where this Court

should exercise the powers under Section 482 of the

Criminal Procedure Code, 1973, with a view to

preventing the abuse of the process of law as prima

facie, also, no involvement in the commission of any criminal act is found on the part of the respective

applicants.

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10. As a result, the present applications are allowed to

the aforesaid extent.