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TMI Blog2015 (12) TMI 709X X X X Extracts X X X X X X X X Extracts X X X X ..... sought to be made. The complainant, who is a respondent herein, is a Parliamentarian, who claims to have been a Member of Parliament for five times and his credentials are highlighted in the impugned order. The respondent-complainant claims to be champion in leading crusade against corruption. This time, he has sought to expose cheating, fraud, criminal misappropriation, etc., by Office Bearers of the Congress Party who also happen to be the members of a Private Company-Young Indian Private Company (hereinafter referred to as Y.I.) and major shareholders of Associated Journals Private Limited (hereinafter referred to as AJL), which was engaged in publishing of newspapers including National Herald, etc.. 2. On a criminal complaint filed by Dr. Subramanian Swamy (hereinafter referred to as respondent/complainant) alleging cheating, etc., trial court after recording pre-summoning evidence of the complainant-Dr. Subramanian Swamy (CW-1), a Charted Accountant-M.R.Ventakesh (CW-2), an official from Registrar of Companies-Gulab Chand (CW-3) and J. Gopikrishnan (CW-4) associated with the newspaper-The Pioneer, vide impugned order of 26th June, 2014 has summoned petitioners of the above-c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cknow, Bhopal, Mumbai, Indore, Patna, Panchkula and other places. According to respondent-complainant, the conservative real estate worth of AJL is Rs. 5,000/- crores. 5. It is the case of respondent-complainant that Y.I. after acquiring the control over AJL, declared that it will not publish any newspaper including National Herald. Undisputedly, National Herald building is a prime property in New Delhi, which was leased out for commercial purpose and AJL is receiving rental of Rs. 60 lacs per month in respect of this property alone. The precise stand of respondent-complainant is that accused Nos. 1 and 2 had hatched criminal conspiracy with accused Nos. 3 to 6, who are their loyalists, to defraud the Congress Party and AJL by dubiously forming Y.I. Company to misappropriate the huge assets of AJL and petitioners/accused have committed criminal breach of trust reposed in the Congress Party as well as AJL and its shareholders. According to respondent-complainant, the rights of the shareholders of AJL and its properties had been dishonestly misappropriated by petitioners/accused by conversion of loan of Rs. 90 crores odd into equity shares in favour of Y.I. and in this dubious manne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... including National Herald as it was against the declared objective submitted for obtaining the registration under Section 25 of the Companies Act. Step 7: The Memorandum of Association of the AJL bars the Company from entering into any transaction which is not for furthering its objective to publish newspapers. Step 8: National Herald House is a prime property in Bahadur Shah Zafar Marg and was given by the Government for the purpose of publishing a newspaper at concessional rates. However, the Young Indian now owner of the National Herald House has opened this property for commercial renting such as to Multinational Companies and to the Ministry of External Affairs for its Passport Seva Kendra on rent. 8. What role has been played by petitioners/accused has been also spelt out in the impugned order, which needs no reproduction as the facts are not in dispute. To highlight the criminal conspiracy amongst petitioners, reliance was placed by respondent-complainant on a chart showing inter connection between the office bearers of All India Congress Party, Directors of Associated Journal Limited and the Directors of Young Indian company. For ready reference, the relied upon Chart ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ." 10. At the hearing, it was submitted by both the sides that the common impugned order in the above captioned five petitions is to be tested on identical submissions and so, with the consent of both the sides, these petitions were heard together while treating Crl.M.C.3333/2014 to be the lead case and after having heard both the sides at length, these petitions are being disposed of by this common judgment. 11. At the outset, this Court places on record its deep appreciation for the able assistance rendered by both the sides to facilitate a proper understanding of facts in the light of the evidence led and the contextual reference to the judicial precedents. 12. To assail the impugned order, vide which petitioners have been summoned as accused, precise submissions have been advanced in the form of written synopsis, which were supplemented by oral submissions and reliance was placed upon various decisions to highlight that upon a bare reading of the complaint in question, no criminal offence is prima facie made out. 13. With much persuasiveness, learned senior counsels for petitioners had submitted that none of the ingredients of alleged offences exists. Attention of this Cour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was pointed out that neither the Representation of the Peoples Act nor the Income Tax Act or any other Act prohibits giving of loans by Political Party. To maintain that a Political Party can invest in commercial ventures, reliance was placed upon a decision of Income Tax Tribunal in Bhartiya Janata Party v. Deputy Commissioner of Income Tax CIT (2003) 258 ITR 1. It was further submitted that writing off the loans by Congress Party is not an illegal act nor there is any breach of trust qua the shareholders of AJL. To assert that a shareholder is not the owner of the assets belonging to the Company, reliance was placed upon Apex Court's decision in Bacha F. Guzdar, Bombay v. Commissioner of Income Tax, Bombay (1955) 1 SCR 876. According to petitioners, it is not for the complainant or anybody else to decide that in what manner the affairs of AJL had to be managed. 16. It is the case of petitioners that there was no fraudulent misrepresentation and the control of the assets of AJL rests with the Company and there was no dishonest inducement because allotment of the majority of equity shares of AJL to Y.I. stands duly approved in the AJL's Extraordinary General Meeting of 21st Januar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court was drawn to Section 39 of Cr.P.C. to point out that for the offences scheduled therein, any person can maintain a complaint, but the offences of cheating and criminal misappropriation are not there in the said Schedule to Section 39 of Cr.P.C.. It was thus submitted that unless the necessary mens rea is there, such a complaint cannot be proceeded with. It was asserted on behalf of petitioners that neither the shareholders of AJL nor any supporter/donor of Congress Party or anyone from Y.I. has made any complaint and infact, only such persons are competent to file the complaint in question and not the respondent-complainant, who has malafidely filed the instant complaint. It was submitted that the complaint in question proceeds on the basis of unwarranted assumptions and presumptions and contains misstatement of facts and so, there is no justification to proceed further with the instant complaint. 19. It was vehemently contended on behalf of petitioners that no inference of criminal conspiracy can be drawn as there is no material on record to suggest that Y.I. was formed as a part of criminal conspiracy to take over the assets of AJL. It was pointed out that it is a matter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Y.I. can get any dividend. d) Y.I. balance sheet similarly shows nil income received. 22. Finally, it was submitted on behalf of petitioners that by entertaining the complaint in question and by passing the impugned order, trial court has abused the process of law and so, the instant complaint and the impugned order deserves to be quashed. 23. Respondent-complainant, who has chosen to argue these petitions in person, had submitted at the outset that impugned order suffers from no illegality or perversity and that there is due application of mind. It was submitted that in the exercise of jurisdiction under Section 482 of Cr.P.C., the truthfulness or otherwise of the allegations cannot be gone into and the inherent powers are to be exercised with circumspection on the basis of the complaint and not by taking into consideration any fresh material/documents. To submit so, reliance was placed upon Apex Court's decision in N.Soundaram v. P.K.Pounraj & Anr. 2014 (10) SCC 616. 24. Dismissal of these petitions was sought by respondent-complainant by submitting that petitioners have alternate remedy to approach the trial court while invoking Section 245 of Cr.P.C.. Reliance was placed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it has been highlighted as to how 761 shareholders of AJL were reduced to minority status of 1% with no clue as to what was in store for them and instead of reviving the newspaper publication, the assets of AJL are being misused to earn commercial profits, which was not the purpose of AJL. In support of the stand taken by respondent-complainant, reliance was placed upon decisions in Binod Kumar & Ors. v. State of Bihar & Anr; (2014) 10 SCC 663; N.Soundaram v. P.K.Pounraj & Anr; (2014) 10 SCC 616, Rishipal Singh v. State of U.P. (2014) 7 SCC 215; Arvind Kejriwal & Ors. v. Amit Sibal & Anr. (2014) 1 JCC 229; Rajiv Thapar & Ors. v. Madan Lal Kapoor (2013) 3 SCC 330; Crl.M.C. 4751 of 2013 titled Kamla Rana v. NCT State & Ors. decided on 19th May, 2014; Nupur Talwar v. CBI (2012) 11 SCC 465; Bhushan Kumar v. NCT (2012) 5 SCC 424; Subramanian Swamy v. Manmohan Singh (2012) 3 SCC 64; Centre for Public Interest Litigation & Ors. v. Union of India & Ors. (2012) 3 SCC 1, (2012) 1 SCC; Indian Oil Corporation v. NEPC India Ltd. & Ors. (2006) 6 SCC 736; M/s Medchl Chemicals & Pharma P.Ltd. v. M/s Biological E.Ltd. & Ors. (2000) 3 SCC 269; Rashmi Kumar v. Mahesh Kumar Bhada (1997) 2 SCC 397; St ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case to summon petitioners as accused is made out. Upon scrutiny of the impugned order, this Court is constrained to note that the presumptive observations made by the trial court are uncalled for and such a deeper scrutiny of facts is not required to be undertaken at this initial stage and on a bird's eye view, it is required to be seen whether a prima facie case to summon petitioners as accused is made out or not. Such a deep scrutiny of facts is required at the charge stage and not at the summoning stage. 31. In the instant case, it cannot be disputed that the Office Bearers of the Congress Party are the trustees of the funds belonging to the Party. No doubt, a Political Party can have income from other sources as well and can invest money in mutual funds, etc., to augment its resources. However, it has to be kept in mind that the allegations against the Office Bearers of the Congress Party are of siphoning off the party funds in a clandestine manner. The impropriety of extending interest free loans to a separate legal entity i.e. AJL, which is a Public Limited Company, by the Congress Party is a matter of concern in a democratic set up, particularly, when the source of Congre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It also needs to be examined at pre-charge stage as to whether lacs of citizens who had donated to the Congress Party felt cheated by assignment of such a huge debt to Y.I. who was managed by none others than petitioners, who were Office Bearers of Congress Party as well as Directors of Y.I.. Not only this, the main persons, who were instrumental in allegedly siphoning off political funds were the recipients of the assignment of the huge debt by the Congress Party and they were the same persons, who had clandestinely acquired the control of AJL. All this smacks of criminality. What species of criminal offence is made out is not required to be seen at this initial stage. 33. In all fairness to petitioners, it needs to be noted that subtle factual inaccuracies in the stand taken by respondent-complainant were pointed out, but this Court finds that the so-called inaccuracies pointed out do not substantially impact upon the substratum of the case set up against petitioners as it is immaterial as to whether the existing share equity was taken over by Y.I. or fresh shares were floated to marginalize the existing shareholders and without any public issue of the fresh shares floated, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to be considered at the charge stage, as by then, after cross-examination of respondent-complainant, full baked facts would come to the fore. At present, the facts are half baked in the sense that one side of the picture is emerging but upon taking the case of respondent-complainant on its face value, it cannot be prima facie said that the ingredients of the offences alleged are lacking. It needs no reiteration that this is not the stage to even prima facie opine that the ingredients of any of the alleged offences exist to justify putting petitioners on trial or not. Any observation made in this regard by the trial court or this Court shall have no bearing when the case of petitioners is considered at the charge stage. 37. Apex Court in N. Soundaram v. P.K. Pounraj and Another (2014) 10 SCC 616 has reiterated the principles governing the inherent jurisdiction under Section 482 of Cr.P.C. by reminding the Courts that this power has to be exercised sparingly and cautiously to prevent abuse of process of the court and to secure the ends of justice while cautioning that inherent powers should not be exercised to stifle a legitimate prosecution and High Courts should refrain from gi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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