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TMI Blog2015 (2) TMI 1045X X X X Extracts X X X X X X X X Extracts X X X X ..... was tampered/forged prior to institution of the legal proceedings, the Court will have jurisdiction to entertain an application under section 340 of the Code if the document has been produced in Court proceedings. Further it is laid down that making of false averment in the pleading pollutes the stream of justice. It is an attempt at inviting the Court into passing a wrong judgment and that is why it must be treated as an offence. Where a verification is specific and deliberately false, there is nothing in law to prevent a person from being proceeded for contempt. The Company Law Board was not barred from entertaining the application under section 340 CrPC and has thus erred in refusing to entertain the application filed by the Appellant.The impugned order is accordingly set aside. - Decided in favour of appellant. - CO. A(SB) 50/2013 - - - Dated:- 5-12-2014 - MR. JUSTICE SANJEEV SACHDEVA, J. For The Appellant : Mr.Suhail Dutt, Senior Advocate with Mr. Vikas Tiwari and Mr.Neeraj Gupta, Advocates For The Respondent : Mr.Ankit Sibal, Advocate SANJEEV SACHDEVA, J. 1. This appeal arises out of order dated 18.9.2013 of the Company Law Board whereby the Company La ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty files pleadings being aware that the document on which such pleading is based is forged and fabricated? 5. Since the Company Law Board has held that there is a jurisdictional bar, the merits of the allegation of the Appellant or the defence of the Respondent are not being considered in the present judgment. 6. The Appellant No. 1 and Respondent are real brothers and sons of late Sh. K. C. Dhawan. The dispute relates to the succession to the shares of Late Sh. K. C. Dhawan in the Appellant No. 2 Company. 7. The Respondent filed before the Company Law Board Minutes of Meeting of the Board of Directors allegedly held on 16.08.2010 wherein the Resolution is allegedly passed for distribution of the shares of late Sh. K.C.Dhawan between his four sons, one daughter and the wife. 8. It is an admitted case of the parties that the Minutes of Meeting produced by the Respondent are forged and fabricated. 9. The contention of the Appellant is that the Respondent who held only 1% share forged and fabricated the Minutes of the Board and filed the petition under Section 397/398/402 and 403 of the Companies Act, 1956 contending that he had 15% shares based on the said Board Minute ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant on merits. 16. Since the application has not been considered by the Company Law Board on merits, the question that arises for consideration is whether there is a jurisdictional bar in entertaining such an application? 17. In case, there is no threshold jurisdictional bar in entertaining the application, then the Company Law Board would be required to consider the merit of the pleas of the Appellant and the defence of the Respondent. 18. Learned Counsel for the Appellant pointed out to similarities between the font and contents of the Board Resolution and the Suit filed by the Respondent to contend that the Board Resolution was forged as the table in the Resolution and the Suit were identical having identical font, punctuation marks etc. It was submitted that the address of the Respondent in the Resolution was incorrect and even the ages of the parties were incorrect. This in my view is a plea on the merits of the application and is not relevant to be considered at this stage as the question arising for consideration is with regard to the jurisdictional bar of the Company Law Board. 19. To decide the question of law that arises for consideration, it would be neces ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... public servants, for offences against public justice and for offences relating to documents given in evidence.- (1) No Court shall take cognizance- (a) . (b)(i) of any offence punishable under any of the following sections of the Indian Penal Code,(45 of 1860) namely, sections 193 to 196 (both inclusive), 199, 200, 205 to 211 (both inclusive) and 228, when such offence is alleged to have been committed in, or in relation to, any proceeding in any Court, or (ii) of any offence described in section 463, or punishable under section 471, section 475 or section 476, of the said Code, when such offence is alleged to have been committed in respect of a document produced or given in evidence in a proceeding in any Court, or . (iii) .. except on the complaint in writing of that Court, or of some other Court to which that Court is subordinate. . 23. Section 195(1)(b)(i) (ii) CrPC lay down that no Court shall take cognizance of any offence punishable under any of the following sections of the Indian Penal Code, (45 of 1860) namely, sections 193 to 196 (both inclusive), 199, 200, 205 to 211 (both inclusive) and 228, when such offence is alleged to have been committed in, or in r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he issue in the present case is not with regard to the powers or jurisdiction of the Second Court but with regard to the powers and jurisdiction of the First Court as it is before the First Court (Company Law Board) that an application under Section 340 CrPC has been filed for initiating perjury action against the Respondent for having filed proceedings before that very Court based on forged and fabricated documents knowing the same to be forged. The application or complaint has not been filed before any Second Court for initiating action against the Respondent in respect of proceedings pending before the First Court. 31. The embargo as laid down by Sections 195(1)(b)(i) (ii) CrPC applies on the Second Court and not on the First Court. It applies only where a forgery has taken place after the document has been filed. There is no embargo on the First Court from proceeding with a complaint under section 340 CrPC about a document forged and fabricated prior to the same being filed or even after it has been filed. The embargo would even not apply where a forged and fabricated document is sought to be used in a proceeding. 32. There may be three situations. (i) document is forge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Court of Metropolitan Magistrate (Second Court) to entertain a petition in respect of the proceedings pending before the Court of the District Judge (First Court). It was in these circumstances the Supreme Court laid down that bar under Section 195 CrPC would be attracted only when the offences enumerated in the said provisions have been committed with respect to a document which has been produced or given in evidence in a proceedings in any Court, i.e., during the time when the document was in custodia legis. 38. The Supreme Court further held that an enlarged interpretation to Section 195(1)(b)(ii), whereby the bar created by the said provision would also operate where after commission of an act of forgery the document is subsequently produced in Court, is capable of great misuse. 39. The Supreme Court affirmed the decision in the case of SACHIDA NAND SINGH (SUPRA) wherein it was pointed out that, if an enlarged interpretation were given, there may be a situation where after preparing a forged document or committing an act of forgery, a person may manage to get a proceeding instituted in any civil, criminal or revenue court, either by himself or through someone set up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court held as under: 12. It would be a strained thinking that any offence involving forgery of a document if committed far outside the precincts of the Court and long before its production in the Court, could also be treated as one affecting administration of justice merely because that document later reached the court records. 44. Para 12 has to be read in context of Para 8 wherein the Court has laid down as under: 8. That apart it is difficult to interpret Section 195(1)(b)(ii) as containing a bar against initiation of prosecution proceedings merely because the document concerned was produced in a court albeit the act of forgery was perpetrated prior to its production in the Court. Any such construction is likely to ensue unsavoury consequences. For instance, if rank forgery of a valuable document is detected and the forgerer is sure that he would imminently be embroiled in prosecution proceedings he can simply get that document produced in any long-drawn litigation which was either instituted by himself or somebody else who can be influenced by him and thereby pre-empt the prosecution for the entire long period of pendency of that litigation. 45. The Company Law Bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ind is not how such statements may injure this or that party to litigation but how they may deceive and mislead the Courts and thus produce mischievous consequences to the administration of justice. A person is under a legal obligation to verify the allegations of fact made in the pleadings and if he verifies falsely, he comes under the clutches of law. 8.9. Consequently, there cannot be any doubt that if a statement or averment in a pleading is false, it falls within the definition of offence under Section 191 of the Code (and other provisions). It is not necessary that a person should have appeared in the witness box. The offence stands committed and completed by the filing of such pleading. There is need for the justice system to protect itself from such wrong doing so that it can do its task of justice dispensation. 9. What constitutes the offence? 9.1. Inasmuch as on a complaint of Respondent No. 2, a prosecution of the Petitioner is pending before the Metropolitan Magistrate, the question also arises as to what constitutes the offence because it may be said that since prosecution is pending, why should a second inquiry or prosecution be called for. On the face, such a cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... false averments and also filing of documents that were forged as distinct from forgery at home. It will also be contempt of Court. 48. This Court has thus held that even if a document was tampered/forged prior to institution of the legal proceedings, the Court will have jurisdiction to entertain an application under section 340 of the Code if the document has been produced in Court proceedings. Further it is laid down that making of false averment in the pleading pollutes the stream of justice. It is an attempt at inviting the Court into passing a wrong judgment and that is why it must be treated as an offence. Where a verification is specific and deliberately false, there is nothing in law to prevent a person from being proceeded for contempt. 49. The reliance placed by the Respondent on the case of KISHOREBHAI GANDUBHAI PETHANI V. STATE OF GUJARAT, 2013 (12) SCALE 1 is misplaced. In the said case in a trial before the Sessions Court a medical report was tendered in evidence. It was alleged that the medical report was tampered with. An application was filed before the sessions court to enquire into the matter of tempering with the medical report. A complaint was also lodged ..... X X X X Extracts X X X X X X X X Extracts X X X X
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