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2019 (5) TMI 730 - SC - Companies LawOffence of theft - oppression and mismanagement - Theft of documents - immovable property - respondents herein are alleged to have used the documents of appellant-Corporation without calling upon them to produce the documents in accordance with law - cognizance of the offence u/s 380 IPC - quashing of FIR u/s 482 Cr.P.C. HELD THAT - The High Court, in our view, was not right in holding that the replication of the documents or use of information in the documents No.1 to 28 and the contents thereon are not corporeal property and would not amount to theft qua documents No.1 to 28. The documents and the replication of the documents and the contents thereon have physical presence and therefore, are certainly corporeal property and the same can be the subject matter of theft. In the present case, the documents are used in good faith in the legal proceedings i.e. Company Petition filed by respondents No.1 to 5 alleging oppression and mismanagement and the other suits are the civil suits challenging the cancellation of the Trusts. These cases are pending and both the parties are hotly contesting those cases. Use of the documents in judicial proceeding by the respondents is to substantiate the case of oppression and mismanagement of the appellant-Company. Absolutely, no dishonest intention or wrongful gain could be attributed to the respondents. Likewise, there is no wrongful loss to the appellants so as to attract the ingredients of Sections 378 and 380 IPC. The intention under Section 24 IPC dishonestly must be to cause wrongful loss to the other or to have wrongful gain for oneself. In determining whether a person has acted dishonestly or not, it is the intention which has to be seen. By filing the documents in the legal proceedings, there is no intention on the part of the respondents to cause wrongful loss to the appellant nor intention to make wrongful gain to themselves. Filing of the documents in the legal proceedings is only to vindicate their stand in the company petition. We find much force in the submission of the learned senior counsel, Mr. Sibal, appearing for respondents No.1 to 5 that the attempt of the appellant in trying to prosecute the respondents appears to arm-twist the respondents in an attempt to shut out the relevant material documents before the CLB proceedings by prosecuting respondents No.1 to 9 and in the civil suits. As discussed earlier, there are no specific allegations as to when, where and how the respondents have committed theft; nor are there specific allegations against the respondents accused. Allegations in the complaint, being taken at their face value, do not disclose prima-facie case nor the ingredients of the offence of house theft or misappropriation are made out. In the present case, it is one thing to say that the documents have not been secured in accordance with the law and no value could be attached to them. But merely because documents have been produced from one source or other, it cannot be said that documents have been dishonestly removed to obtain wrongful gain to the respondents and cause wrongful loss to the appellant. Where it appears that the criminal complaint has been filed to bring pressure upon the respondents who are shown as accused in the criminal case, the complaint is to be quashed. The FIR or the criminal proceedings can be quashed if the allegations do not make out a prima-facie case or allegations are so improbable that no prudent person would ever reach a just conclusion that there are sufficient grounds for proceeding against the accused. So far as, the allegation of retention of the documents No.29 to 54, in our view, no allegation as to when and how the original documents were removed and retained by the respondents. Where on the admitted facts no prima-case case is made out against the accused for proceeding or when the Supreme Court is satisfied that the criminal proceedings amount to abuse of process of court, Supreme Court has the power to quash any judicial proceedings in exercise of its power under Article 136 of the Constitution of India. In our view, the present case is a fit case for exercising the power in quashing the criminal complaint qua the documents No.29 to 54 also. By the order of the Magistrate dated 08.10.2010, cognizance was taken against respondents No.1 to 16 for commission of the offences under Sections 380, 411 and 120B IPC. There are no averments in the complaint nor are there allegations in the statement of the complainant or the witness P.B. Dinesh as to when and how the theft was committed and the order of the Magistrate dated 08.10.2010 taking cognizance of the criminal case against respondents No.1 to 16 qua documents No.1 to 54 is liable to be set aside - It is held that the document as defined in Section 29 IPC is a moveable property within the meaning of Section 22 IPC which can be the subject matter of theft. The information contained thereon in the documents would also fall within the purview of the corporeal property and can be the subject matter of the theft. The findings of the High Court is modified to that extent. The use of documents No.1 to 28 and documents No.29 to 54 by the respondents in judicial proceedings is to substantiate their case namely, oppression and mismanagement of the administration of appellant-Company and their plea in other pending proceedings and such use of the documents in the litigations pending between the parties would not amount to theft. No dishonest intention or wrongful gain could be attributed to the respondents and there is no wrongful loss to the appellant so as to attract the ingredients of Sections 378 and 380 IPC. Continuation of the criminal proceedings would be an abuse of the process of the court. The order of the Magistrate dated 08.10.2010 taking cognizance of the offences and the issuance of summons to respondents No.1 to 16 and the criminal proceedings thereon are liable to be quashed. Appeal dismissed - decided against appellant.
Issues Involved:
1. Prima facie case and satisfaction of the Magistrate. 2. Non-application of mind in taking cognizance of the offences. 3. Quashing of criminal proceedings for documents No.1 to 28. 4. Filing of documents in judicial proceedings as theft. 5. Dishonest moving of documents causing wrongful loss and gain. 6. Filing of documents as theft under Section 378 IPC. Analysis of the Judgment: 1. Prima Facie Case and Satisfaction of the Magistrate: The court examined whether the allegations in the complaint and the statements of the complainant and witnesses were sufficient to constitute a prima facie case justifying the Magistrate's satisfaction in issuing process against the respondents. The court emphasized that the Magistrate must be satisfied that there are sufficient grounds for proceeding against the accused based on the allegations made in the complaint and the evidence in support of the same. 2. Non-application of Mind in Taking Cognizance of the Offences: The court scrutinized whether the Magistrate's order taking cognizance of the offences under Sections 380, 411, and 120-B IPC and ordering issuance of process against the respondents was vitiated due to non-application of mind. The court held that the Magistrate must apply his mind to the facts of the case and the law applicable thereto, and there must be sufficient indication that there was application of mind by the Magistrate to the facts constituting the commission of the offence. 3. Quashing of Criminal Proceedings for Documents No.1 to 28: The High Court quashed the criminal proceedings for documents No.1 to 28 on the ground that mere information contained in the documents cannot be considered as "movable property" and cannot be the subject of the offence of theft or receipt of stolen property. The Supreme Court modified this finding, holding that the documents and the replication of the documents and the contents thereon have physical presence and therefore, are "corporeal property" and can be the subject matter of theft. 4. Filing of Documents in Judicial Proceedings as Theft: The court considered whether the temporary removal of the documents and filing of photocopies and use of the information/contents of the documents can be the subject matter of theft. The court held that in the facts and circumstances of the case, taking away of the documents temporarily and using them in the pending litigations between the parties would not amount to theft. The court emphasized that there was no "dishonest intention" or "wrongful gain" attributed to the respondents, and there was no "wrongful loss" to the appellants so as to attract the ingredients of theft under Section 378 IPC. 5. Dishonest Moving of Documents Causing Wrongful Loss and Gain: The court examined whether there was dishonest moving of documents causing wrongful loss to the appellants and wrongful gain to the respondents. The court held that the intention to take "dishonestly" exists when the taker intends to cause wrongful loss to any other which amounts to theft. The court found that the respondents used the documents in good faith in the legal proceedings to substantiate their case of oppression and mismanagement, and no dishonest intention or wrongful gain could be attributed to them. 6. Filing of Documents as Theft under Section 378 IPC: The court considered whether the filing of documents in the judicial proceedings can be termed as an act of theft causing wrongful gain to oneself and wrongful loss to the opponent so as to attract the ingredients of Section 378 IPC. The court held that the respondents' use of the documents in the litigations pending between the parties would not amount to theft. The court emphasized that there was no intention on the part of the respondents to cause wrongful loss to the appellant or to make wrongful gain for themselves. Conclusion: The Supreme Court set aside the order of the Magistrate dated 08.10.2010 taking cognizance of the offences and the issuance of summons to respondents No.1 to 16. The court held that the continuation of the criminal proceedings would be an abuse of the process of the court. The appeals preferred by the respondents were allowed, and the appeal preferred by the appellants was dismissed.
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