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2024 (6) TMI 338 - HC - Income TaxValidity of the Summoning Order - Applicability of Section 202 Cr.P.C. in the context of the Benami Act - trial of offences punishable under the Benami Act - validity of the summoning order on the sole ground that the applicant resides at New Delhi, i.e. beyond the territorial jurisdiction of Court which has passed the summoning order cognizance of the offence and summoning the applicant to face the trial - validity of an order passed by Additional Sessions Judge, Lucknow whereby the trial court has taken cognizance of offence u/s 53 r.w.s. 3 of the Prohibition of Benami Property Transaction Act and he has been summoned to face trial. HELD THAT - In exercise of powers conferred by Section 50 of the Benami Act, the Ministry of Finance, Government Of India has issued a Notification dated 16.10.2018 whereby IX Additional District Sessions Judge, Lucknow has been designated as the Special Court for the purpose of trial of offences punishable under the Benami Act for certain Districts, including Ghaziabad District, where the cash amount of Rs. 30,00,000/- was deposited in the Bank account of M/s Shyam Trading Company and from where an amount of Rs. 7,50,000/- was transferred to the Bank account of the applicant. Therefore, the Complaint has rightly been filed before the Special Court constituted under Section 50 of the Benami Act. Applicability of Section 202 Cr.P.C - The Initiating Officer, Benami Prohibition Unit conducted an enquiry, during which the applicant admitted that the amount deposited in the bank account of M/s Shyam Trading Company was unaccounted cash, which was deposited during demonetization. After enquiry, the Initiating Officer found that the aforesaid property was Benami property and he passed an attachment order under Section 24(4) of the Benami Act. The adjudicating Authority gave an opportunity of hearing to the applicant, during which the applicant admitted on oath that the aforesaid sum of Rs. 7,50,000/- deposited into the bank account of M/ s Shyam Trading Company was the applicant s unaccounted cash, which was deposited during demonetization period and had been transferred to his bank account. Thereafter the complaint was filed after obtaining sanction from Principal Director, Income Tax (Investigation) before the Special Court having jurisdiction under the Act. Section 202 Cr.P.C. merely directs that the Magistrate shall hold an enquiry inquire into the case himself or direct an investigation to be made by a police officer or by such other person as he thinks fit, for the purpose of deciding whether or not there is sufficient ground for proceeding. Section 202 Cr.P.C. does not prescribe the manner of holding an enquiry under this provision. The Special Court has passed the impugned order taking cognizance of the offence and summoning the applicant after taking into consideration the aforesaid facts and after recording a satisfaction that from the averments made in the complaint and the documents filed with the complaint, there is sufficient ground for proceeding against the applicant. The limited enquiry which the Magistrate can hold at this stage is meant to ascertain whether any case for summoning the accused person is made out. The perusal of the averments made in the complaint made by the Union of India through a Public Servant and examination of the documents accompanying the complaint was sufficient for holding an enquiry under Section 202 Cr.P.C. for recording a satisfaction that there is sufficient ground for proceeding against the applicant. The summoning order passed after taking into consideration the averments made in a complainant filed by the Union of India through a public servant, after perusing the documents filed with the complaint and after recording a satisfaction that there is sufficient ground for proceeding against the applicant, fulfills the requirement of holding an enquiry under Section 202 Cr.P.C. In view of the aforesaid discussion, there appears to be no illegality in the impugned order taking cognizance of the offence and summoning the applicant to face the trial and in any case, it does not cause a failure of justice to the applicant.
Issues Involved:
1. Validity of the summoning order dated 27.02.2024. 2. Applicability of Section 202 Cr.P.C. in the context of the Benami Act. Summary: 1. Validity of the Summoning Order: The petitioner challenged the validity of the order dated 27.02.2024 passed by the IX Additional Sessions Judge, Lucknow, in Complaint Case No. 277 of 2024. The trial court took cognizance of the offence u/s 53 read with Section 3 of the Prohibition of Benami Property Transaction Act, 1988 (Benami Act) and summoned the petitioner to face trial. The complaint was filed by the Union of India through a Deputy Commissioner of Income Tax/Initiating Officer, Benami Prohibition, after obtaining sanction for prosecution from the Principal Director of Income Tax (Investigation), Kanpur, u/s 55 of the Benami Act. 2. Applicability of Section 202 Cr.P.C.: The petitioner argued that the summoning order was invalid as he resides outside the territorial jurisdiction of the court, necessitating an inquiry u/s 202 Cr.P.C. before taking cognizance. The petitioner relied on several judgments, including Vishwakalyan Multistate Credit Coop. Society Ltd. v. Oneup Entertainment (P) Ltd., Azim Premji v. State of U.P., and Divyajot Singh Jendu v. Manikaran Analytics Ltd., which emphasized the mandatory nature of an inquiry when the accused resides outside the jurisdiction. Conversely, the opposite party argued that the Proviso (a) to Section 200 Cr.P.C. exempts the need for such an inquiry when the complaint is made by a public servant. They cited the Supreme Court decision in Cheminova India Limited v. State of Punjab, which held that the Magistrate need not record the statement of a public servant who files a complaint in the discharge of official duty. Court's Analysis: The court examined the relevant statutory provisions, including Sections 50, 200, and 202 of the Cr.P.C. It noted that the IX Additional District & Sessions Judge, Lucknow, was designated as the Special Court for the trial of offences under the Benami Act, including those from Ghaziabad District. The court found that the complaint was filed by a public servant, and the Special Court took cognizance after considering the complaint's contents and accompanying documents, which revealed sufficient grounds for proceeding against the petitioner. The court referred to the Supreme Court's explanation in Rosy v. State of Kerala regarding the limited nature of the inquiry u/s 202 Cr.P.C., which aims to ascertain whether there is a prima facie case for issuing process against the accused. The court held that the perusal of the complaint and documents filed by a public servant sufficed for the inquiry u/s 202 Cr.P.C. Conclusion: The court concluded that there was no illegality in the impugned order dated 27.02.2024, taking cognizance of the offence and summoning the petitioner. The application u/s 482 Cr.P.C. filed by the petitioner was dismissed for lacking merit.
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