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TMI Blog2015 (5) TMI 47X X X X Extracts X X X X X X X X Extracts X X X X ..... n undertaken for instilling fear amongst the individual authorities compelling them to concede to the request for one time settlement which the financial institution possibly might not have acceded. That apart, despite agreeing for withdrawal of the complaint, no steps were taken in that regard at least to show the bonafide. On the contrary, there is a contest with a perverse sadistic attitude. Whether the complainant could have withdrawn the prosecution or not, is another matter. Fact remains, no efforts were made. Magistrate, as we find, while exercising the power under Section 156(3) Cr.P.C. has narrated the allegations and, thereafter, without any application of mind, has passed an order to register an FIR for the offences mentioned in the application. The duty cast on the learned Magistrate, while exercising power under Section 156(3) Cr.P.C., cannot be marginalized. - Magistrate has to remain vigilant with regard to the allegations made and the nature of allegations and not to issue directions without proper application of mind. He has also to bear in mind that sending the matter would be conducive to justice and then he may pass the requisite order. The present is a case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall be filed. The warrant for giving a direction that an the application under Section 156(3) be supported by an affidavit so that the person making the application should be conscious and also endeavour to see that no false affidavit is made. It is because once an affidavit is found to be false, he will be liable for prosecution in accordance with law. This will deter him to casually invoke the authority of the Magistrate under Section 156(3). Magistrate should have kept himself alive to the aforesaid provision before venturing into directing registration of the FIR under Section 156(3) Cr.P.C. It is because the Parliament in its wisdom has made such a provision to protect the secured creditors or any of its officers, and needles to emphasize, the legislative mandate, has to be kept in mind. - Decided in favour of appellant. - CRIMINAL APPEAL NO.781 OF 2012 - - - Dated:- 19-3-2015 - Dipak Misra and Prafulla C. Pant, JJ. For The Appellant : Mr. Ajay Kumar, AOR, Mr. Sudeep Dey, Adv. For The Respondent : Mr. Vikrant Yadav, Adv., Mr. Gaurav Dhingra, AOR, Mr. Ashutosh Sharma, Adv., Mr. Sunil Kumar Jain, AOR, Mr. Kaushik Chaudhary, Adv. and Mr. Akarsh Garg, Adv. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Act, the PNBHFL, on 5th June, 2007, submitted an application before the District Magistrate, Varanasi, U.P. for taking appropriate action under Section 13(4) of the SARFAESI Act. 3. At this juncture, the respondent No.3 preferred W.P. No.44482 of 2007, which was dismissed by the High Court on 14th September, 2007, with the observation that it was open to the petitioner therein to file requisite objection and, thereafter, to take appropriate action as envisaged under Section 17 of the SARFAESI Act. After the dismissal of the writ petition with the aforesaid observation, the respondent No.3, possibly nurturing the idea of self-centric Solomon s wisdom, filed a Criminal Complaint Case No.1058 of 2008, under Section 200 Cr.P.C. against V.N. Sahay, Sandesh Tiwari and V.K. Khanna, the then Vice-President, Assistant President and the Managing Director respectively for offences punishable under Sections 163, 193 and 506 of the Indian Penal Code (IPC). It was alleged in the application that the said accused persons had intentionally taken steps to cause injury to him. The learned Magistrate vide order dated 4th October, 2008, dismissed the criminal complaint and declined to take cogniz ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ade by the Sessions Judge or the High Court, as the case may be, to the prejudice of the accused or the other person unless he had an opportunity of being heard either personally or by pleader in his own defence. xxxxx xxxxx xxxxx 48. In a case where the complaint has been dismissed by the Magistrate under Section 203 of the Code either at the stage of Section 200 itself or on completion of inquiry by the Magistrate under Section 202 or on receipt of the report from the police or from any person to whom the direction was issued by the Magistrate to investigate into the allegations in the complaint, the effect of such dismissal is termination of complaint proceedings. On a plain reading of sub-section (2) of Section 401, it cannot be said that the person against whom the allegations of having committed the offence have been made in the complaint and the complaint has been dismissed by the Magistrate under Section 203, has no right to be heard because no process has been issued. The dismissal of complaint by the Magistrate under Section 203-although it is at preliminary stage-nevertheless results in termination of proceedings in a complaint against the persons who are alleged t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... crime have, however, no right to participate in the proceedings nor are they entitled to any hearing of any sort whatsoever by the Magistrate until the consideration of the matter by the Magistrate for issuance of process. Though the present controversy is different, we have dealt with the said facet as we intend to emphasize how the Courts have dealt with and addressed to such a matter so that a borrower with vengeance could ultimately exhibit his high-handedness. 5. As the narration further proceeds, after the remand, the learned Magistrate vide order dated 13th July, 2009, took cognizance and issued summons to V.N. Sahay, Sandesh Tripathi and V.K. Khanna. The said accused persons knocked at the doors of the High Court under Section 482 Cr.P.C. and the High Court in Crl. Misc. No.13628 of 2010, by order dated 27th May, 2013, ruled thus: A perusal of the complaint filed by the respondent no.2 also indicates that the issues were with regard to the action of the bank officers against respondent no.2 on the ground of alleged malafide and as such an offence under sections 166/500 I.P.C. was made out. Both the sections are non cognizable and bailable and triable by Magistrat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8. At this juncture, it is imperative to state that the third respondent made the officials agree to enter into one time settlement. The said agreement was arrived at with the stipulation that he shall withdraw various cases filed by him on acceptance of the one time settlement. As the factual matrix would reveal, the third respondent did not disclose about the initiation of the complaint cases no. 344/2011 and 396/2011. On 28.11.2011, the one time settlement was acted upon and the third respondent deposited ₹ 15 lakhs. 9. At this stage, it is apt to mention that V.N. Sahay and two others approached the High Court of Allahabad in Writ (C) No. 17611/2013 wherein the learned Single Judge heard the matter along with application under Section 482 CrPC in Crl. Misc. No. 13628/2010. We have already reproduced the relevant part of the order passed therein. Be it noted, the writ petition has also been disposed of by the High Court by stating thus: Heard Mr. Manish Trivedi, learned counsel for the petitioner, Mr. Vivek Kumar Srivastava, learned counsel appearing on behalf of respondent no.3 and learned AGA. It is submitted by learned AGA that in the present case investigati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le spirit to indulge himself in the abuse of the process of the Court. The respondent No.3 had filed an application under Section 156(3) Cr.P.C. before the learned Additional Chief Judicial Magistrate on 30th October, 2011, against the present appellants, who are the Vice-President and the valuer respectively. In the body of the petition, as we find in the paragraphs 19 and 20, it has been stated thus: That the aforesaid case was referred to the Deputy Inspector General of Police, Varanasi through speed post but no proceeding had been initiated till today in that regard. That the aforesaid act done by the aforesaid accused prima-facie comes in the ambit of section 465, 467, 471, 386, 504, 34 120B IPC and in this way cognizable offence is made out and proved well. 12. On the basis of the aforesaid application the learned Additional Chief Judicial Magistrate, Varanasi, U.P., called for a report from the concerned police station and received the information that no FIR had been lodged and hence, no case was registered at the local police station. Thereafter, the learned Additional Chief Judicial Magistrate observed as follows: It has been stated clearly in the applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts would submit that the learned Magistrate has the option to accept the report by rejecting the final form/final report under Section 190 Cr.P.C. and may proceed against the appellants or may issue notice to the complainant, who is entitled to file a protest petition and, thereafter, may proceed with the matter and, therefore, this Court should address the controversy on merits and quash the proceedings. 16. We have narrated the facts in detail as the present case, as we find, exemplifies in enormous magnitude to take recourse to Section 156(3) Cr.P.C., as if, it is a routine procedure. That apart, the proceedings initiated and the action taken by the authorities under the SARFAESI Act are assailable under the said Act before the higher forum and if, a borrower is allowed to take recourse to criminal law in the manner it has been taken it, needs no special emphasis to state, has the inherent potentiality to affect the marrows of economic health of the nation. It is clearly noticeable that the statutory remedies have cleverly been bypassed and prosecution route has been undertaken for instilling fear amongst the individual authorities compelling them to concede to the request f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Maksud Saiyed [(2008) 5 SCC 668] examined the requirement of the application of mind by the Magistrate before exercising jurisdiction under Section 156(3) and held that where jurisdiction is exercised on a complaint filed in terms of Section 156(3) or Section 200 CrPC, the Magistrate is required to apply his mind, in such a case, the Special Judge/Magistrate cannot refer the matter under Section 156(3) against a public servant without a valid sanction order. The application of mind by the Magistrate should be reflected in the order. The mere statement that he has gone through the complaint, documents and heard the complainant, as such, as reflected in the order, will not be sufficient. After going through the complaint, documents and hearing the complainant, what weighed with the Magistrate to order investigation under Section 156(3) CrPC, should be reflected in the order, though a detailed expression of his views is neither required nor warranted. We have already extracted the order passed by the learned Special Judge which, in our view, has stated no reasons for ordering investigation. 20. In Dilawar Singh v. State of Delhi(2007) 12 SCC 496, this Court ruled thus: 18. ... ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owever, if he once takes such cognizance and embarks upon the procedure embodied in Chapter XV, he is not competent to revert back to the precognizance stage and avail of Section 156(3). 22. Recently, in Ramdev Food Products Private Limited v. State of GujaratCriminal Appeal No. 600 of 2007 decided on 16.03.2015, while dealing with the exercise of power under Section 156(3) CrPC by the learned Magistrate, a three-Judge Bench has held that: .... the direction under Section 156(3) is to be issued, only after application of mind by the Magistrate. When the Magistrate does not take cognizance and does not find it necessary to postpone instance of process and finds a case made out to proceed forthwith, direction under the said provision is issued. In other words, where on account of credibility of information available, or weighing the interest of justice it is considered appropriate to straightaway direct investigation, such a direction is issued. Cases where Magistrate takes cognizance and postpones issuance of process are cases where the Magistrate has yet to determine existence of sufficient ground to proceed. 23. At this stage, we may usefully refer to what the Constit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 of the Code. The police officer can also, in a given case, investigate the matter and then file a final report under Section 173 of the Code seeking closure of the matter. Therefore, the police is not liable to launch an investigation in every FIR which is mandatorily registered on receiving information relating to commission of a cognizable offence. xxx xxx xxx xxx 115. Although, we, in unequivocal terms, hold that Section 154 of the Code postulates the mandatory registration of FIRs on receipt of all cognizable offences, yet, there may be instances where preliminary inquiry may be required owing to the change in genesis and novelty of crimes with the passage of time. One such instance is in the case of allegations relating to medical negligence on the part of doctors. It will be unfair and inequitable to prosecute a medical professional only on the basis of the allegations in the complaint. After so stating the constitution Bench proceeded to state that where a preliminary enquiry is necessary, it is not for the purpose for verification or otherwise of the information received but only to ascertain whether the information reveals any cognizable offence. After laying d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ects the erroneous approach of the learned Magistrate. It also encourages the unscrupulous and unprincipled litigants, like the respondent no.3, namely, Prakash Kumar Bajaj, to take adventurous steps with courts to bring the financial institutions on their knees. As the factual exposition would reveal, he had prosecuted the earlier authorities and after the matter is dealt with by the High Court in a writ petition recording a settlement, he does not withdraw the criminal case and waits for some kind of situation where he can take vengeance as if he is the emperor of all he surveys. It is interesting to note that during the tenure of the appellant No.1, who is presently occupying the position of Vice-President, neither the loan was taken, nor the default was made, nor any action under the SARFAESI Act was taken. However, the action under the SARFAESI Act was taken on the second time at the instance of the present appellant No.1. We are only stating about the devilish design of the respondent No.3 to harass the appellants with the sole intent to avoid the payment of loan. When a citizen avails a loan from a financial institution, it is his obligation to pay back and not play truant o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rson making the application should be conscious and also endeavour to see that no false affidavit is made. It is because once an affidavit is found to be false, he will be liable for prosecution in accordance with law. This will deter him to casually invoke the authority of the Magistrate under Section 156(3). That apart, we have already stated that the veracity of the same can also be verified by the learned Magistrate, regard being had to the nature of allegations of the case. We are compelled to say so as a number of cases pertaining to fiscal sphere, matrimonial dispute/family disputes, commercial offences, medical negligence cases, corruption cases and the cases where there is abnormal delay/laches in initiating criminal prosecution, as are illustrated in Lalita Kumari are being filed. That apart, the learned Magistrate would also be aware of the delay in lodging of the FIR. 28. The present lis can be perceived from another angle. We are slightly surprised that the financial institution has been compelled to settle the dispute and we are also disposed to think that it has so happened because the complaint cases were filed. Such a situation should not happen. 29. At this ..... X X X X Extracts X X X X X X X X Extracts X X X X
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