Karnataka High Court

Mr Sandeep Jajodia vs R Shivakumar on 22 July, 2021

Author: S Vishwajith Shetty

                                             Crl.P.2939/2021

                               1




 IN THE HIGH COURT OF KARNATAKA AT BENGALURU

         DATED THIS THE 22ND DAY OF JULY 2021

                           BEFORE

     THE HON'BLE MR. JUSTICE S. VISHWAJITH SHETTY

          CRIMINAL PETITION No.2939 OF 2021

BETWEEN:

1.      MR. SANDEEP JAJODIA
        S/O LATE SHRI M.K.JAJODIA,
        AGED ABOUT 55 YEARS,
        PAST PRESIDENT, ASSOCHAM,
        4TH FLOOR, YMCA CCL BLDG.,
        1 JAI SINGH ROAD,
        NEW DELHI - 110001.
        RESIDING AT: 1/17, SHANTI NIKETAN,
        NEW DELHI - 110021.

2.      MR. KUNTAL KAR
        S/O SHRI R.M.KAR,
        AGED ABOUT 46 YEARS,
        FINANCE CONTROLLER AND
        COMPANY SECRETARY, ASSOCHAM,
        4TH FLOOR, YMCA CCL BLDG.,
        1 JAI SINGH ROAD, NEW DELHI - 110001.
        RESIDING AT: 1282, TYPE-II QTRS,
        LODHI ROAD COMPLEX,
        NEW DELHI - 110003.                   ... PETITIONERS

(BY SRI RAGHURAMAN.V., ADV.)

AND:

R.SHIVAKUMAR
S/O LATE RAJANNA,
                                                   Crl.P.2939/2021

                                  2




AGED ABOUT 66 YEARS,
NO.25, 9TH CROSS,
KUMARA PARK WEST,
BENGALURU - 560020.                              ... RESPONDENT

(BY SMT. KOMALA.G., ADV.)


      THIS CRIMINAL PETITION IS FILED UNDER SECTION
482 OF CR.P.C. PRAYING TO QUASH THE ORDER DATED
12.06.2018 TAKING COGNIZANCE AND ORDER DATED
03.01.2020   ISSUING   PROCESS      (ANNEXURE-A)  IN
P.C.R.NO.6843/2018 (CONVERTED TO C.C.NO.5710/2020)
PENDING ON THE FILE OF XXXII ADDL.C.M.M.,
BENGALURU IN RELATION TO OFFENCES P/U/S 120B AND
500 OF IPC AND ETC.

    THIS   CRIMINAL PETITION COMING ON                          FOR
ADMISSION, THIS DAY, THE COURT MADE                             THE
FOLLOWING:

                             ORDER

The petitioners, who are accused Nos.1 and 3 in

C.C.No.5710/2020 arising out of P.C.R.No.6843/2018

pending on the file of XXXII Additional C.M.M.,

Bangalore, for the offence punishable under Sections

120B and 500 of IPC, have approached this court with a

prayer to quash the entire proceedings in the said case as

against them.

Crl.P.2939/2021

2. Brief facts of the case that would be relevant for the

purpose of disposal of this petition are:

The complainant has filed a private complaint

before the LVI Addl.Chief Metropolitan Magistrate,

Bangalore City in P.C.R.No.6843/2018 arraying the

petitioners herein as accused Nos.1 and 3 contending

that the petitioners herein, who are the President and

Financial Controller and Company Secretary of the

Company known as ASSOCHAM India, had filed police

complaints against the complainant herein, who is the

Ex-Chairman of the Karnataka Branch of ASSOCHAM

India before the Chanakyapuri Police Station, New Delhi

and Vayalikaval Police Station at Bengaluru, making

various allegations against the complainant which

according to him amount to defaming him. He has stated

in the complaint that the averments made in the

complaint are perse defamatory and it amounts to casting

aspersions on the complainant and the accused persons Crl.P.2939/2021

knowing fully well that the said averments are false and

far from truth with an intention to defame the

complainant and with oblique motives have filed the

complaint. With these allegations, a private complaint

was filed with a prayer to secure the accused persons and

punish them for the offences punishable under Sections

120B and 500 of IPC and also to pay compensation to the

complainant. The trial court on receipt of the complaint

after taking cognizance of the alleged offences recorded

the sworn statement of the complainant and

thereafterwards has issued summons to the accused

persons under Section 204 of Cr.P.C. Being aggrieved by

the same, the petitioners, who are accused Nos.1 and 3

before the trial court, have approached this court with a

prayer to quash the entire proceedings as against them.

3. Learned counsel appearing for the petitioners

submits that the petitioners were only the office bearers

of the Company. Complaints were lodged before the Crl.P.2939/2021

Chanakyapuri Police Station, New Delhi and Vayalikaval

Police Station at Bengaluru against the complainant on

behalf of the Company and not in the individual capacity

of the petitioners. He submits that the complaint

averments itself would go to show that the Police

complaints were filed by the petitioners herein on behalf

of the Company and the petitioners were duly authorized

by the Company to prefer such complaints against the

complainant in the present case. He submits that since

the Police complaints were filed on behalf of the Company

in the absence of Company being made a party to the

present proceedings, the office bearers of the Company

cannot be prosecuted.

4. In support of his arguments, he has relied upon the

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

Maksud Saiyed -vs- State of Gujarat and Others1 and

(2008) 5 SCC 668 Crl.P.2939/2021

has referred to para-13 of the said judgment. He also

submits that the private complaint has been filed before

the court of Magistrate at Bengaluru and the accused

persons are shown as residents of New Delhi. He submits

that admittedly the accused persons are residing beyond

the jurisdiction of the jurisdictional Magistrate and

compliance of the requirement of Section 202 of Cr.P.C. is

mandatory and in the absence of such compliance, the

learned Magistrate could not have proceeded under

Section 204 of Cr.P.C. and this irregularity committed by

the learned Magistrate would vitiate the entire

proceedings.

5. Per contra, learned counsel appearing for the

respondent - complainant submits that it is the

petitioners herein, who had lodged the Police complaint

and the complaints are signed by them. She submits that

the complaints do not bear the seal of the Company, but

it is only given in the letter head of the Company and Crl.P.2939/2021

therefore, it cannot be said that the complaint was lodged

on behalf of the Company.

6. A perusal of the two complaints alleged to have been

given by the petitioners before the Chanakyapuri Police

Station, New Delhi and Vayalikaval Police Station at

Bengaluru would go to show that the said complaints

were given in the letter-head of the Company Further it

is very clearly stated that the complainants therein who

are petitioners in this case have been authorized to lodge

this complaint and the complaints have been signed as

authorized signatories of the Company. The Hon'ble

Supreme Court in the case of Maksud Saiyed (supra) at

para-13 has observed as follows:

"13. Where a jurisdiction is exercised on a complaint petition filed in terms of Section 156(3) or Section 200 of the Code of Criminal Procedure, the Magistrate is required to apply his mind. The Penal Code does not contain any provision for attaching vicarious liability on the part of the Managing Director or the Directors of the Company when the accused is the Company. The learned Magistrate failed to Crl.P.2939/2021

pose unto himself the correct question viz. as to whether the complaint petition, even if given face value and taken to be correct in its entirety, would lead to the conclusion that the respondents herein were personally liable for any offence. The Bank is a body corporate. Vicarious liability of the Managing Director and Director would arise provided any provision exists in that behalf in the statute. Statutes indisputably must contain provision fixing such vicarious liabilities. Even for the said purpose, it is obligatory on the part of the complainant to make requisite allegations which would attract the provisions constituting vicarious liability."

7. From the reading of the said judgment, it is very

clear that unless the statute specifically provides for

fixing vicarious liability, the Directors or the Office

bearers of the Company cannot be individually held liable

for the offences said to have been committed by the

Company, that too, if the Company is not arrayed as an

accused to the proceedings. Further, the Hon'ble

Supreme Court in the case of Udai Shankar Awasthi -

Crl.P.2939/2021

vs- State of Uttar Pradesh and Another2 has held that

compliance of the requirement of Section 202 of Cr.P.C. is

mandatory. In para-40 of the said judgment, it has been

observed as follows:

"40. The Magistrate had issued summons without meeting the mandatory requirement of Section 202 Cr.P.C., though the appellants were outside his territorial jurisdiction. The provisions of Section 202 Cr.P.C. were amended vide Amendment Act 2005, making it mandatory to postpone the issue of process where the accused resides in an area beyond the territorial jurisdiction of the Magistrate concerned. The same was found necessary in order to protect innocent persons from being harassed by unscrupulous persons and making it obligatory upon the Magistrate to enquire into the case himself, or to direct investigation to be made by a police officer, or by such other person as he thinks fit for the purpose of finding out whether or not, there was sufficient ground for proceeding against the accused before issuing summons in such cases. (See also Shivjee Singh v. Nagendra Tiwary, SCC P.584, para 11 and National Bank of Oman v. Barakara Abdul Aziz.)"

(2013) 2 SCC 435 Crl.P.2939/2021

8. This Court in the case of Mallikarjuna and others

-vs- State of Karnataka3 at paragraphs-12 and 13 has

observed as follows:

"12. The Judicial Magistrates, who are empowered to summon the accused under Section 204 of the Code of Criminal Procedure, should always keep it in mind that summoning the accused is a serious matter and the criminal law cannot be set into motion as a matter of course. The summoning order must reflect that the Magistrate has applied his judicious mind to the facts of the case and the law applicable thereto. The order of summoning the accused need not be a speaking order and a detailed one. But, it should not suffer from any infirmity or illegality. Where reasons are not assigned, however short in may be, for coming to the conclusion that it is a fit case for issuance of summons, such summoning order would become bad in law. The Magistrates, while issuing process, are not required to meticulously examine and evaluate the materials on record. However, he is only required to record reasons, however short, or brief it may be, which indicate the application of mind by the Magistrate. That is all expected from him at that stage. The expression "opinion" and "sufficient ground" under Section 204 gives as indication that before issuing process, the Magistrate should show that on what material, at least, he has formed his opinion that it is a fit case to issue process. Without applying

ILR 2018 KAR 354 Crl.P.2939/2021

his judicious mind and without even looking to the facts of the case, mechanically, issuing process only on the basis of the operative portion of the charge sheet or the complaint does not amount to application of mind by a Magistrate.

13. Looking to the above facts and circumstances and the legal infirmities found in the above said case, I am of the opinion that the Learned Magistrate, without applying his judicious mind, has mechanically passed an order taking cognizance of the offences and the same is bad in law. All further proceedings, which has taken place in pursuance of that, is vitiated by a serious irregularity which cannot be cured. Hence, there is no other go for this Court but to quash the proceedings."

9. In the present case, the complainant has not

arrayed the Company ASSOCHAM India as a party to the

private complaint. A reading of the two complaints said

to have been given by the petitioners herein against the

complainant before the Chanakyapuri Police Station, New

Delhi and Vayalikaval Police Station at Bengaluru would

go to show that the said complaints were lodged on behalf

of the Company and not by the petitioners in their

individual capacity. Therefore, in the absence of the Crl.P.2939/2021

Company being arrayed as party, the criminal

prosecution as against the petitioners, who are the office-

bearers of the Company is not sustainable in law.