The State Of Karnataka vs Greenbuds Agro Form Limited
2021 Latest Caselaw 2027 Kant

                                                                R
     IN THE HIGH COURT OF KARNATAKA AT BENGALURU

           DATED THIS THE 31ST DAY OF MAY, 2021

                             BEFORE

          THE HON'BLE MR. JUSTICE K. NATARAJAN

            CRIMINAL PETITION NO.9302 OF 2016
BETWEEN:
       THE STATE OF KARNATAKA
       BY CID,
       REPRESENTED BY STATE PUBLIC PROSECUTOR,
       BENGALURU - 560 001.
                                                    ... PETITIONER
       (BY SRI SHEELAVANTH V.M., S.P.P-I)
AND:
1.     GREENBUDS AGRO FORM LIMITED COMPANY,
       NO.73, 3RD FLOOR,
       MADWESHA COMPLEX, NAZARBAD,
       MYSURU - 570 010,
       REPRESENTED BY B.L. RAVINDRANATH.
2.     SRI B.L. RAVINDRANATH
       S/O. LATE B.L. LAKSHMEGOWDA,
       AGED ABOUT 43 YEARS,
       MADWESHA COMPLEX, NAZARBAD,
       MYSURU - 570 010.
       ALSO AT NO.109, D. MAX SANVILLA APARTMENT,
       KENGERI MAIN ROAD, MALLATTHAHALLI,
       BALAJI LAYOUT,
       BENGALURU.
3.     SMT. GAYATHRI N.
       GENERAL MANAGER,
       D/O. NANJEGOWDA,
       AGED ABOUT 36 YEARS,
       GREENBUNDS AGRO FORM LTD. CO.,
       NO.73, 3RD FLOOR, MADWESHA COMPLEX,
       NAZARBAD,
       MYSURU - 570 010.
       ALSO AT NO.183/1, DATTA NAGAR,
       OOTY ROAD, MYSURU.
                                     2



4.   U.L. DAKSHAYINI
     W/O. B.L. RAVINDRANATH,
     NO.66/F, S.V.P. NAGAR,
     T.N. PURA ROAD,
     MYSURU.
     ALSO AT NO.109,
     D. MAX SANVILLA APARTMENT,
     KENGERI MAIN ROAD,
     MALLATTHAHALLI, BALAJI LAYOUT,
     BENGALURU - 560 060.

5.   U.L. VASANTH KUMAR
     S/O. LAXMAN GOWDA,
     AGED ABOUT 27 YEARS,
     NO.66/F, S.V.P. NAGAR,
     T.N. PURA ROAD,
     MYSURU.
     PRESENTLY RESIDENT OF NO.109,
     D. MAX SANVILLA APARTMENT,
     KENGERI MAIN ROAD,
     MALLATTHAHALLI, BALAJI LAYOUT,
     BENGALURU - 560 060.
                                                     ... RESPONDENTS
     (BY SRI RAGHAVENDRA N., ADVOCATE)
                           ***
     THIS CRIMINAL PETITION IS FILED UNDER SECTION 482 OF
THE CR.P.C., PRAYING TO SET ASIDE THE JUDGMENT AND ORDER
DATED   8-8-2016   PASSED   BY     THE   PRINCIPAL      DISTRICT   AND
SESSIONS JUDGE, MYSURU, IN CRIME NO.116 OF 2013 AND
RESTORE THE CASE ON THE FILE OF THE DISTRICT AND SESSIONS
JUDGE, MYSURU, IN CRIME NO.116 OF 2013 AND DIRECT THE TRIAL
COURT TO TAKE COGNIZANCE OF THE OFFENCES AGAINST THE
RESPONDENTS-ACCUSED.

     THIS    CRIMINAL   PETITION    HAVING       BEEN    HEARD     AND
RESERVED FOR ORDERS ON 29-3-2021 AND COMING ON FOR
PRONOUNCEMENT THIS       DAY,    THE     COURT    PRONOUNCED       THE
FOLLOWING:
                                  3


                          ORDER

The State by C.I.D. filed this petition under Section 482

of the Code of Criminal Procedure Code, 1973 (for short,

'Cr.P.C.') being aggrieved by the order dated 8-8-2016 passed

by the Principal District and Sessions Judge, Mysuru,

(hereinafter referred to as 'Trial Court') in Crime No.116 of

2013 for having rejected the charge-sheet filed by the Police

Inspector, Financial and Vigilance Unit, C.I.D., Bengaluru.

2. The petitioner-State is the complainant and the

respondents are the accused before the Trial Court. The

ranks of the parties before the Trial Court are retained for the

sake of convenience.

3. The case of the prosecution is that, accused No.1 is

the Greenbuds Agro Farms Limited Company and accused

Nos.2 to 5 are the Managing Directors and Directors of the

said Company. It is alleged that, they have collected

investments from the general public and cheated the public

up to Rs.12,95,13,433/-. The individual investors have filed

complaints before different Police Stations in Mysuru District.

The State Government, by its order, appointed the

jurisdictional Assistant Commissioner as Competent

Authority for the purpose of taking action against the accused

under Section 5 of the Karnataka Protection of Interest of

Depositors in Financial Establishments Act, 2004 (hereinafter

referred to as 'Act'). Accordingly, investigation has been done

and a common charge-sheet came to be filed by the Police

Inspector, Financial and Vigilance Unit, C.I.D., before the

Trial Court. The Trial Court, by its impugned order, rejected

the charge-sheet filed under the Act on the ground that the

Police Inspector is not the Competent Officer to file the report

or for taking action and hence, the accused were discharged

for the offence punishable under Section 9 of the Act.

However, liberty was granted to the Investigating Officer to file

charge-sheet before the jurisdictional Magistrate for the

offences punishable under the Indian Penal Code, 1860 (for

short, 'IPC'), which is under challenge before this Court.

4. Heard the arguments of the learned State Public

Prosecutor-I for the petitioner-State and perused the records.

Learned counsel for the respondents-accused remained

absent in spite of granting sufficient opportunities by way of

adjournments.

5. Previously, this Court dismissed the petition on 12-

6-2020 and later, restored the same on 1-10-2020. At that

time, the learned counsel for the respondents appeared and

submitted no objection to recall the order. Accordingly, I.A.

No.1 of 2020 was allowed and the petition was restored by

recalling the order of dismissal.

6. The learned State Public Prosecutor-I has contended

that as per Section 4 of the Cr.P.C., the Special Court

established under the Act is having power to try the offences

punishable under the IPC as well as the offences punishable

under the Special Law, but the Trial Court misread Section 5

of the Act and committed error in discharging the accused,

even though liberty was granted for filing charge-sheet before

the Magistrate by ignoring the special provisions of law. Even

if the charge-sheet is returned, the question of discharging

the accused is illegal. Hence, he prayed for setting aside the

same.

7. Admittedly, the accused were involved in cheating of

depositors, who invested in their Company and they were

many complaints filed by the individual investors in different

Police Stations of Mysuru District for the offences punishable

both under Section IPC, especially Section 420 of the IPC, and

Section 9 of the Act. In view of the order of the Government,

the Assistant Commissioner was appointed as per Section 5

of the Act for making enquiry and to file report. However, the

said report of the Assistant Commissioner, who is a

Competent Authority, required to deal with the investments of

the Company or other property believed to have been acquired

from out of the deposits and to attach the said investments

under Section 3 of the Act and to protect the interest of the

investors in accordance with the procedure laid down in the

Special Act. Section 9 of the Act prescribes punishment for

the offence committed by the Company which is liable for

punishment of both imprisonment as well as fine. As per

Section 18 of the Act, the Cr.P.C. is applicable and the Special

Court shall follow the procedure specified in the Cr.P.C. for

the trial of warrant cases by the Magistrate, which is nothing

but a Judicial Magistrate, First Class or Metropolitan

Magistrate. Once the complaint is lodged against the

Company for cheating the investors as per Section 154 of the

Cr.P.C. before the Police and once the case is registered, the

Investigating Officer is required to file charge-sheet against

the offenders as per Section 173 of the Cr.P.C. The Special

Court has been established for trying the offences committed

under Section 10 of the Act. Therefore, the Investigating

Officer is required to file charge-sheet before the Special

Court established under the Act.

8. As per Section 4(2) of the Cr.P.C., all offences under

any other law shall be investigated, inquired into, tried and

otherwise dealt with according to the same provisions, but

subject to any enactment for the time being in force

regulating the manner or place of investigating, inquiring

into, trying or otherwise dealing with such offences. Such

being the case, bifurcating the offences punishable under IPC

and Special Law is not correct. Both the offences are required

to be tried together by the Special Court established under

the Act.

9. Though the Trial Court rightly refused to accept the

charge-sheet, but committed error in discharging the accused

and directing the Investigating Officer to file charge-sheet

before the jurisdictional Magistrate. Once the Special Court

is established, the question of discharging the accused for the

reasons that the charge-sheet is filed by incompetent

Investigating Officer does not arise. The Trial Court misread

the provisions of Special Act and has not considered Section 4

of the Cr.P.C.

10. The Investigating Officer committed mistake in

filing common charge-sheet for the various crime registered in

different Police Stations which is impermissible. In this

regard, the Division Bench of the Delhi High Court in the case

of STATE v. KHIMJI BHAI JADEJA (Crl. Ref. No.1 of 2014

dated 8-7-2019) has considered the judgments of various

High Courts as well as Supreme Court and held that filing an

amalgamated charge-sheet is impermissible. At paragraph

Nos.76 and 80, it has held as under:

"76. From Chapter XII of the Cr.P.C., it is evident that upon disclosure of information in relation to commission of a cognizable offence, the police is bound to register the FIR. The registration of FIR sets into motion the process of investigation. The same culminates into the filing of the final report by the police officer before the Magistrate. Thus, in respect of every FIR, there would be a separate final report and, there could be, further report(s) in terms of Section 173(8).

xxx xxx xxx

80. Thus, our answer to question (b) is that in respect of each FIR, a separate final report [and wherever necessary supplementary/ further charge sheet(s)] have to be filed, and there is no question of amalgamation of the final reports that may be filed

in respect of different FIRs. The amalgamation, strictly in terms of Section 219 Cr.P.C., would be considered by the Court/ Magistrate at the stage of framing of charge, since Section 219(1) mandates that where the requirements set out in the said Section are met, the accused "may be charged with, and tried at one trial for, any number of them not exceeding three"."

11. I am in respectful agreement with the view taken by

the Division Bench of the Delhi High Court. On perusal of the

judgment stated supra, it is clear that, the offences which are

similar in nature committed by the same accused within

twelve months can be tried together by framing a common

charge as per Section 219 of the Cr.P.C., but the question of

filing common charge-sheet in multiple crimes or complaints

is impermissible.

12. In a similar provisions of the Special Act, at Tamil

Nadu, the Madras High Court in an unreported judgment in

the case of P.S. CHELLAMUTHU AND OTHERS v. THE

STATE BY DEPUTY SUPERINTENDENT OF POLICE AND

ANOTHER in Crl.O.P. Nos.21711 and 35339 of 2007

dated 4-12-2008 has considered the similar Special Act

namely, Tamil Nadu Protection of interests of Depositors (in

Financial Establishments) Act, 1997, wherein it has held that

in respect of trying the offences by the Special Court and

taking cognizance, the Cr.P.C. would apply.

13. Similarly, in the Special Act, Section 18 of the Act

empowers the Special Court for taking cognizance, trying the

accused person by following the procedures specified in the

Cr.P.C. The first conviction shall be punishable with

imprisonment for a term which may extend to six years with

fine and which may be extend to Rs.1.00 lakh and proviso to

Section 9 of the Act prescribes that the imprisonment shall

not be less than three years in the absence of special and

adequate reasons. Part 2 of Schedule-I of the Cr.P.C.

prescribes the classification of offences against other laws. If

the offence punishable for three years and upwards, but not

more than seven years, the offence is cognizable and bailable.

The Special Act is silent about offence under the present Act

is whether cognizable or non-cognizable. Thereby, the

Cr.P.C. is applicable. As per part 2 of Schedule I of the

Cr.P.C., the offence under Section 9 is cognizable and non-

bailable. That apart, as per Section 18(2) of the Act, the

anticipatory bail is applicable, which shows that the offences

are non-bailable. Such being the case, the Trial Court came

to wrong conclusion that as per Section 5 of the Act, the

Police Officer was incompetent to file the charge-sheet. Filing

the report by the Competent Authority to the Government is

different aspect in respect of returning the money to the

investors and protecting the investment made by the accused

Company out of the investors' amount. So far as punishment

in criminal cases is concerned, the Police or Special Police

have power to file final report before the Special Court.

However, the question of filing common charge-sheet for

various complaints filed by the individual investors in

different Police Station limits is against the law and the

question of filing amalgamated charge-sheet does not arise

and it is impermissible under the Cr.P.C.

14. Therefore, the State-C.I.D. Police have no authority

to file common charge-sheet in different complaints.

However, the Investigating Officer has to file separate charge-

sheet against each crime registered by the Police on

individual complaint. Thereafter, the Special Court shall take

cognizance of the offences both punishable under the IPC and

the Special Act by following the Cr.P.C. and dispose of the

matter in accordance with law. So far as on the report of the

Competent Authority, it has to be submitted to the State

Government and later, the Trial Court on the report of the

Competent Officer to attach or seize the properties and

investments under Section 3 of the Act for the purpose of

protecting the interests and refunding the money to the

investors as per Section 12 of the Act.

15. For the reasons stated above, the Trial Court

committed error in rejecting the charge-sheet on the ground

that the Investigating Officer is not the Competent Authority

to file the charge-sheet and wrongly discharged the accused

for the offence punishable under Section 9 of the Act and also

committed error in directing the Investigating Officer to file

the charge-sheet before the jurisdictional Magistrate in

respect of the offences punishable under the IPC. Therefore,

the impugned order requires to be quashed.

16. Accordingly, the petition is allowed. The order

dated 8-8-2016 passed by the Principal District and Sessions

Judge, Mysuru, in Crime No.116 of 2013 is hereby quashed.

Discharging the accused is hereby set aside.

17. Further, the Special Court is directed to return the

charge-sheet to the Investigating Officer in order to file

separate charge-sheet in respect of the each individual

complaints and thereafter, the Trial Court shall proceed in

accordance with law.

Registry to intimate the Trial Court forthwith.

Sd/-

JUDGE

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