2024 (8) TMI 1070 - HC - Benami Property

Summoning order passed in Criminal Complaint Case u/s 53 and 3 of the Prohibition of Benami Property Transaction Act 1988 - Acting upon the assumption that the cash was the beneficial property of the applicant who accumulated cash out of illegal gratification by misuse of official possession it was attached under Section 24(4) of the PBPT Act HELD THAT - Hon ble Supreme Court of India in the case of Lalankumar Singh 2022 (10) TMI 1135 - SUPREME COURT has specifically held that the order of issuance of process is not an empty formality. The Magistrate is required to apply his mind as to whether sufficient ground for proceeding exists in the case or not. Hon ble Supreme Court of India in the case of Pepsi Foods Ltd. 1997 (11) TMI 518 - SUPREME COURT has held that summoning of an accused in a criminal case is a serious matter and criminal law cannot be set into motion as a matter of course Ld court below has simply summarized the contents of the complaint fact that sanction order was passed and the court had jurisdiction to entertain the matter and thereafter without recording any reason or without examining the nature of allegation made in the complaint the evidence regarding truthfulness of the allegation or any reason whatsoever as to why the cognizance is being taken and the accused is summoned has straightaway passed the cognizance and summoning order even prima facie satisfaction or reasons for taking cognizance or proceedings against the petitioner has not been recorded while passing the impugned order dated 27.2.2024 thus the impugned summoning order dated 27.2.2024 is contrary to the law laid down by Hon ble Supreme Court of India in the cases of Lalankumar Singh Pepsi Foods Ltd. supra and Mehmood UL Rehman 2015 (3) TMI 1349 - SUPREME COURT Considering the above the application is disposed of. The impugned summoning order passed by learned IXth Additional Sessions Judge Lucknow in Criminal Complaint Case is set aside.

Summary

Issues:
Impugned summoning order under Prohibition of Benami Property Transaction Act, 1988; Allegation of cash possession by applicant's wife; Validity of attachment under PBPT Act; Challenge to provisional attachment order; Show cause notice for prosecution initiation; Concealment of Interim Board of Settlement order; Application of Section 53 of PBPT Act; Perversity of summoning order; Supreme Court judgments applicability.

Analysis:
The judgment involves a challenge to the impugned summoning order dated 27.02.2024 under the Prohibition of Benami Property Transaction Act, 1988. The applicant, aggrieved by the order, contended that the proceedings were initiated based on cash seized from his wife during an income tax search, which was already treated as her income by the Interim Board of Settlement. The applicant argued that he was not the beneficial owner of the cash and that the requirements of Section 53 of the PBPT Act were not met. The applicant also alleged concealment of the Interim Board of Settlement order by the respondents. The judgment delves into the legal aspects of the case, including the application of relevant provisions of the PBPT Act.

The court examined the contentions raised by both parties. The applicant's counsel relied on judgments of the Supreme Court, including Lalankumar Singh, Pepsi Foods Ltd., and Mehmood UL Rehman, emphasizing the importance of proper application of mind before summoning an accused in a criminal case. The judgments highlighted the need for the Magistrate to scrutinize the evidence and ensure that the allegations constitute a violation of law. The court analyzed these precedents to determine the legality of the summoning order in the present case.

Upon perusal of the record and considering the arguments presented, the court found that the summoning order lacked proper reasoning and failed to establish prima facie satisfaction for initiating proceedings against the applicant. The court observed that the order did not reflect a detailed examination of the allegations or the evidence presented. Consequently, the court set aside the impugned summoning order and remanded the matter back to the lower court for a fresh reasoned order within a specified timeframe. The judgment emphasized the necessity of following legal principles and ensuring a thorough examination of the facts before summoning an accused in a criminal case.

In conclusion, the judgment provides a detailed analysis of the legal issues surrounding the impugned summoning order under the PBPT Act. It underscores the importance of proper application of legal principles and adherence to established precedents in criminal proceedings. The court's decision to set aside the summoning order and direct a fresh reasoned order reflects a commitment to upholding the rule of law and ensuring fair judicial process in the case.