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TMI Blog1986 (4) TMI 342X X X X Extracts X X X X X X X X Extracts X X X X ..... section 5 of the Imports and Exports (Control) Act, 1947 (hereinafter called the 'Act') which had been made by the Deputy Chief Controller of Imports and Exports, Shri J.P. Sharma of which the learned Metropolitan Magistrate, Delhi took cognizance and issued summons against the accused persons. The prosecution had been lodged against Arun Kumar, Ramniklal Mehta, Harshad, M/s Arun Kumar & Co. a partnership concern of the aforesaid persons also against Shri Vinod Kumar Jain, Shri Rakesh Jain, Ramanand Jain, Jagdish Rai Jain, Shri Ram Jain, Swaraja Kumar Jain, Pyarelal Aggarwal, Pyarelal Malhotra, Ashok Kumar, M/s Jain Sudh Vanaspati Ltd. All the aforesaid persons were at all material time directors and Vinod Kumar Jain was the Managing Director of the company mentioned aforesaid. The allegation was that the accused had entered into a conspiracy to contravene the provisions of the Act. Accused Nos. 2 to 9 in the said complaint were alleged to have entered into a conspiracy to contravene the provisions of section 5 of the Act by participating in the Board's meetings of the company on 28th March, 1983 and 30th June, 1983. By a resolution of the Board of Directors of M/s Jai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the date of licence and further extension of six months, if granted. In this connection reference may be made to paragraph 185 of Import Policy 1982-83. Clause (5) and (7) of the said paragraph are relevant and these are as follows : "(5) Export Houses who wish to take advantage of this facility of import of OGL items should get the licences concerned endorsed by the licensing authority as under :- 'This licence will also be valid for import of OGL items under para 185 of Import-Export Policy, 1982-83, subject to the conditions laid down, and shall be non-transferable.' (7) Import of OGL items by Export Houses under these provisions shall be subject to the condition, inter alia that the shipment of goods shall take place within the validity of OGL i.e. 31st March 1983 or within the validity period of the import licence itself (without any grace period), whichever date is earlier. This restriction will also apply to licences issued before 1.4.1982 in respect of items which continue to be on OGL in 1982-83 policy. (The restriction regarding grace period will not, however, apply in cases where shipment can be made within the permissible grace period on or before 31.3.1983)." ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... move for early hearing of the petition." Thereafter shipments started for Canadian Port. On 30th June, 1983, New Bank of India opened letter of credit. On 18th April, 1983, relevant invoice for the sale of beef tallow by M/s Alugul to Jain Sudh Vanaspati was issued. On 3rd May, 1983, show-cause notice under section 124 of the Customs Act, 1962 was issued. Cause was shown on 11 th May, 1983. On 24th May, 1983, Collector of Customs, Bombay passed orders confiscating the consignment for home consumption. An appeal was preferred against the said order of the Collector and the same was stated to be pending. On 28th August, 1983, Government of India issued an abeyance orders barring Shri V.K. Jain from getting import licence and allotment of canalised items. Complaint was filed by the Deputy Chief Controller of Imports and Exports in the Court of Chief Metropolitan Magistrate for offences under section 120B of Indian Penal Code read with section 5 of the Act. mis was the matter of challenge before the Delhi High Court. It may be appropriate to refer to the relevant portions of the said complaint. F The complaint was under section 120B of Indian Penal Code and the substantive offence a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd uncut, that letter of authority, according to the complaint, would not be valid for import of OGL items endorsed on 20.9.1982 as per the slip attached with the aforesaid Import licence, dated 29.6.1981 in view of the provisions of para 383(2) of the Hand Book of Imports and Exports Procedure, 1982-83. Reference was made to the said para in the complaint. Thereafter mention was made of the writ petition referred to hereinbefore and it was stated that in the said writ petition, several prayers were made and the substance of the order was stated in the complaint. We have already set out the order. Thereafter the complaint went on to state that Shri V.K.Jain approached the New Bank of India even prior to the passing of the said order by the Delhi High Court that Delhi A High Court may pass orders on New Bank of India for the opening of letter of credit. He also approached PNB, Chawri Bazar, Delhi through his letter dated 17th March and 18th March, 1983 falsely mentioning therein that New Bank of India, Janpath Branch had agreed to open foreign letter of credit on 150 days sight on Singapore on behalf of accused No. 10 requesting PNB to give the requisite undertaking/indemnity to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of letter of credit (As the letter of credit was opened on 30th March, 1983)." It was therefore alleged that accused persons in criminal conspiracy with each other and also with other persons, illegally imported beef tallow of the total value, the particulars whereof were set out in the complaint. It was further alleged that J.S.V.L. and other accused persons also unauthorisedly imported consignments of inedible beef tallow which were shipped from U.S., Canadian and Australian ports, particulars whereof were mentioned in the complaint . It was further alleged that in furtherance of the said criminal conspiracy, the said J.S.V.L. appointed M/s Damani Bros. to clear the consignment of inedible beef tallow illegally imported by them and other accused and that in fact M/s Damani Bros., Bombay preferred following two Bills of Entry, particulars whereof were mentioned in the complaint. It was further alleged that although the bills of entry submitted by M/s Damani Bros. On behalf of M/s. J.S.V.L. for the clearance of 12 consignments mentioned 5 import licences as detailed in the complaint, yet the clearance was sought against import licence No.P/L/K/0452196 dated 29th June, 1981. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted by CBI/SPE/CIU(E) II on 20th September, 1983 and was released on that date under the orders of the High Court of Delhi. The complaint was filed by Shri J.P. Sharma, Deputy Chief Controller of Imports and Exports. Chief Metropolitan Magistrate accepted the complaint and issued summons. On 14th December, 1983, summons were issued to the accused. Thereafter on 7th February, 1984, Criminal revision petition was filed before the Delhi High Court by Pyarelal Agarwal and Pyarelal Malhotra. Thereafter on 23rd May, 1984, Criminal Miscellaneous (Main) No. 145 of 1984 was filed by Arun Kumar & Co. for quashing the complaint. This was admitted by the Delhi High Court. Remaining accused also filed petitions under section 482 Criminal Procedure Code for quashing the complaint. There was a supplementary investigation made by CBI on July, 1984. According to the present respondents, the accused before the High Court, this was very relevant and it showed that there was no basis for the complaint. According to the Government, this was not relevant or necessary for justifying prosecution. Delhi High Court by its judgment dated 8th February, 1985 quashed the complaint as mentioned herein before. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t with Swiss Bank Corporation w.e.f. 1.8.1981. Therefore on the allegation, it appears that the charge was that it was a non-existent firm with which the contract was entered into in order to facilitate import of prohibited articles under licence under circumstances which were not permissible. All these are in short the substance of the charges. It has also been alleged that M/s B. Arun Kumar & Co. being Accused No. 13 in the complaint in their capacity as Export House and Merchant Exporter had applied to the Joint Controller of Imports and Exports for grant of imprest licence for Rs.. 10,04,97,000 for the import of 'diamonds unset and uncut' for the purpose of re-export of cut and polished diamonds for FOB value of Rs. 10,04,97,000. Against this application, the Joint Controller had issued the imprest licence indicated hereinbefore. Another charge was that somewhere in March, 1982, the accused Nos. 1 to 10 had entered into a criminal conspiracy. In para 10 of the complaint it was alleged that according to the provisions contained in para 383(2) of the Hand Book of Imports and Exports Procedure 1982-83, the licencee could not issue any letter of authority after 20th Septe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year 1982-83. The learned judge further noted the allegations and of conspiracy and of the overt acts alleged in pursuance of the conspiracy. He also noted the order of the High Court set out hereinbefore dated 16th March 1983. After analysing the complaint, according to the learned judge, the following were the charges, namely; 1. Could the beef tallow in respect of which a firm contract under the previous policy was in existence be imported? E 2. Could the licence of B. Arun Kumar and Company which was issued on 20th February, 1982 for OGL item and made non-transferable be utilised for purposes of import of beef tallow? According to the learned judge, in the ultimate analysis, two acts were alleged against the accused in the complaint, namely; beef tallow being an item canalised, it could not have been imported and M/s Arun Kumar's licence could not have been used for the import of this item. The learned judge then referred to a note bearing No. 1266/84 which was the report of an investigation made on the aspect of the opening of letter of credit for the import of beef tallow by M/s. J.S.V.L. through National Bank of India. This note was prepared by the CBI in collabora ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was canalised actually after the contract came into existence. In fact the whole case is based upon law. The facts by and large are admitted by the parties. The fact is that import of beef tallow was permissible under OGL before it came to be canalised on 5.6.1981." Then the learned judge went on to analyse the constitution of JSVL and its conduct, the enquiry by Interpole, the order of the High Court, the banning of Interpole, the consequences of difference between public notices and statutory Orders. According to him, banning of beef tallow by Public Notice would not amount to any contravention of the order passed under the Act. The learned judge was of the view that there was no conspiracy and such a complaint should not have been lodged and no legalistic view should be taken and there was no case to proceed on the complaint. He accordingly quashed the complaint. The principles on which the complaint can be quashed under section 482 of the Code of Criminal Procedure are well settled. The learned judge seemed to have proceeded that no conspiracy could ever be imputed by holding of the Director's meeting. Whether a conspiracy in the facts and circumstances of a particular ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not by notice. The power under section 482, Criminal Procedure Code, has been examined by this Court in Municipal Corporation of Delhi v. Ram Krishan Rohtagi & Oks., [1983] 1 S.C.R. 884. It was laid down clearly that the test was that taking the allegations and the complaint as these were, without adding or subtracting anything, if no offence was made out then only the High Court would be justified in quashing the proceedings in exercise of its powers under section 482 of Code of Criminal Procedure. There this Court observed that the power under section 482 should be used very sparingly. In that case the fact that proceedings had been quashed against some of the directors would not prevent the court from exercising its discretion under section 319 of the Code if it was fully satisfied that a case for taking cognizance against them had been made out on the additional evidence led before it. Section 319 of Code of Criminal Procedure gives ample powers to any court to take cognizance to add any person not being an accused before it and try him along with the other accused. The learned judge, in the instant case had observed that in this case the Bank had not been made a party to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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