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CHEQUE BOUNS CASE

Code of Criminal Procedure, 1973 – s. 319 – Power to proceed against other persons appearing to be guilty of offence – On facts, complaint u/s. 138 Negotiable Instruments Act against a firm and its partners – Subsequently, application u/s. 319 for joining appellant and one other person as co- accused in the complaint, on basis of document (copy of registration of the firm) whereby the proposed accused were shown as partners of the firm – Direction by Judicial Magistrate to join them as co-accused – Said order upheld by the High Court – On appeal, held: High Court failed to consider whether the Magistrate had addressed to the essential aspects before invoking power u/s. 319 – Also the High Court did not advert to the question whether or not filing of copy of registration of the firm by its partners would be covered by expression in the course of inquiry into or trial and evidence occurring in s. 319 which would also show that the appellant committed the offence – With regard to the criminal liability of a partner in the firm, there has to be evidence that when the offence was committed, the partner was in-charge of and was responsible to the firm for the conduct of the business of the firm – High Court did not consider these aspects – Thus, matter remitted back to the High Court for reconsideration – Negotiable Instrument Act, 1881 – ss. 138 and 141. Code of Criminal Procedure, 1973 – s. 319 – Power under – Ambit and scope of – Explained. Respondent No. 2 filed a complaint against a partnership firm and its two partners-accused no. 2 and 3, before the Judicial Magistrate, alleging commission of offence under Section 138 of the Negotiable Instruments Act, 1881 and under Section 114 of the Penal Code, 1860. Subsequently, the complainants filed an application under Section 319 of the Code of Criminal Procedure, 1973 for joining two other partners – `PL’ and appellant, as accused no. 4 and accused no. 5 respectively. It was averred that accused nos. 2 and 3 submitted a copy of the registration of the firm wherein proposed accused no. 4 and 5 were shown as partners of the firm. The Judicial Magistrate directed that `PL’ and the appellant be joined as accused no. 4 and 5. The High Court upheld the order. Thus, the appellant filed the instant appeal. Allowing the appeals, the Court HELD: It would transpire from the order of the High Court that after noticing the provisions contained in Section 319 Cr.P.C. and its scope, the High Court proceeded to hold that the order of the Magistrate did not call for any interference. The High Court, however, failed to consider whether Magistrate has addressed to the essential aspects before invoking his power under Section 319 of the Code. Moreover, the High Court did not advert to the question whether or not filing of copy of registration of the firm by Accused Nos. 2 and 3 would be covered by expressions `in the course of any inquiry into or trial’ and `evidence’ occurring in Section 319 of the Code and also the aspect as to whether such document could be treated as an evidence to show that the appellant (newly added accused) has committed an offence of cheating under Section 420 IPC. As regards the criminal liability of a partner in the firm, in light of the provisions contained in Section 141 of the Act, there has to be evidence that at the time the offence was committed, the partner was in-charge of and was responsible to the firm for the conduct of the business of the firm. A perusal of the impugned order would show that all these relevant aspects have not been considered by the High Court at all and the petitions under Section 482 of the Code were dismissed. As the matter needs to be considered by the High Court afresh, the orders of the Magistrate is not dealt with on merit lest it may prejudice the consideration of the petitions under Section 482 of the Code before the High Court. The impugned order is set aside. Criminal Miscellaneous Application are restored to the original number for hearing and reconsideration by the High Court in accordance with law. [Paras 17 and 18] [1150-B-G] Joginder Singh and Anr. v. State of Punjab and Anr. (1979) 1 SCC 345: 1979 (2) SCR 306; Municipal Corporation of Delhi v. Ram Kishan Rohtagi and Ors. (1983) 1 SCC 1: 1983 (1) SCR 884; Michael Machado and Anr. v. Central Bureau (2000) 3 SCC 262: 2000 (1) SCR 981; Shashikant Singh v. Tarkeshwar Singh and Anr. (2002) 5 SCC 738: 2002 (3) SCR 400; Krishnappa v. State of Karnataka (2004) 7 SCC 792: 2004 (3) Suppl. SCR 894; Palanisamy Gounder and Anr. v. State represented by Inspector of Police. (2005) 12 SCC 327; Guriya alias Tabassum Tauquir and Ors. vs. State of Bihar and Anr. (2007) 8 SCC 224: 2007 (10) SCR 385 – referred to. Case Law Reference: 1979 (2) SCR 306 Referred to Para 9 1983 (1) SCR 884 Referred to Para 10 2000 (1) SCR 981 Referred to Para 11 2002 (3) SCR 400 Referred to Para 12 2004 (3) Suppl. SCR 894 Referred to Para 13 (2005) 12 SCC 327 Referred to Para 14 2007 (10) SCR 385 Referred to Para 15 CRIMINAL APPELLATE JURISDICTION : Criminal Appeal No. 1554-1557 of 2011. From the Judgment and Order dated 05.05.2010 of the High Court of Gujarat at Ahmedabad in Criminal Appeal Nos. 5157, 5158, 5159 and 5160 of 2000. Huzefa Ahmadi, Pradhuma Gohil, Vikas Singh, S. Hari Haran and Jayesh Bhairaria (for Charu Mathur) for the Appellant. Sanjoy Ghose (for Anitha Shenoy) Jesal and Hemantika Wahi for the Respondents.

The supreme court of india. Taken about 170 m ...

The supreme court of india. Taken about 170 m from the main building outside the perimeter wall (Photo credit: Wikipedia)

REPORTABLE

 
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NOS. 1554-1557 OF 2011

(Arising out of S.L.P. (Crl.) Nos. 9527-9530 of 2010)

 
Sarojben Ashwinkumar Shah Etc. …Appellants
Versus

 

State of Gujarat & Anr. …Respondents

 

 

JUDGEMENT

 
R.M. LODHA, J.

 
Leave granted.
2. These four appeals, by special leave, are directed
against the common order of the Gujarat High Court whereby
single Judge of that Court refused to interfere with the orders (all
dated July 11, 2000) of the Judicial Magistrate First Class, Prantij
directing addition of the present appellant as an accused (Accused
No. 5) in various complaints.
3. For the sake of brevity and convenience, we shall refer
to the facts from the appeal arising from complaint (Criminal Case

 

1
no. 1132 of 1999) pending in the Court of Judicial Magistrate First
Class, Prantij. Respondent no. 2–Gulamnabi Hebatkhan Sumara
– filed a complaint against (i) M/s. Rashmi Builders, a partnership
firm, (ii) Ashwinkumar Tribhovandas Shah and (iii) Chandravadan
Gopaldas Thakkar in the Court of Judicial Magistrate, First Class,
Prantij. It was alleged in the complaint that M/s. Rashmi Builders
(Accused No. 1) is a duly registered partnership firm and
Ashwinkumar Tribhovandas Shah (Accused No. 2) and
Chandravadan Gopaldas Thakkar (Accused No. 3) are its
partners. On the recommendation and advise of one Balkabhai
alias Himatlal Dwarkadas Lal, a financial broker, the complainant
lent and advanced a sum of Rs. 5 lakhs to the firm. The firm
through its partner Ashwinkumar Tribhovandas Shah
acknowledged the receipt of the said amount and also executed
and delivered a promissory note for Rs. 5 lakhs on the same date.
Later in discharge of its liability, the firm through its partner
(Accused No. 2) issued a cheque for Rs. 5 lakhs drawn on the
Federal Bank of India, Fort Branch, Bombay and delivered the
same to Balkabhai alias Himatlal Dwarkadas Lal who handed over
the said cheque to the complainant along with the promissory note.
The complainant presented the said cheque for encashment on
May 31, 1999 with his Banker but the same was dishonoured on
June 3, 1999 with the remark “account closed”. The complainant

 

2
then sent a statutory notice of 15 days to the firm and its two
partners which was received by them on or about June 23, 1999.
The accused failed and neglected to make payment within the
statutory period and instead in its reply dated June 29, 1999, the
firm denied having entered into any financial transaction with the
complainant. The complainant thus alleged that the accused have
committed offence under Section 138 of the Negotiable
Instruments Act, 1881 (for short, `N.I. Act’) and under Section 420
and Section 114 of the Indian Penal Code. The other complaints
were lodged by Usmanmiya Nanumiya Ghori, Mohamad
Umarkhan Akbarkhan Ghori and Daudbhai Rasulbhai Mansuri
against the above three accused on the identical facts.
4. The Judicial Magistrate, First Class, Prantij took
cognizance in the above complaints against the three accused,
namely, (i) M/s. Rashmi Builders (a partnership firm), (ii)
Ashwinkumar Tribhovandas Shah and (iii) Chandravadan
Gopaldas Thakkar.
5. On November 4, 1999, the complainant in each of the
complaints made an application under Section 319 of the Code of
Criminal Procedure, 1973 (for short, `the Code’) for joining Paresh
Lakshmikant Vyas and Sarojben Ashwinkumar Shah (appellant
herein) as Accused Nos. 4 and 5 respectively. It was averred that
Accused Nos. 2 and 3 have submitted a copy of the registration of

 

3
the firm–M/s. Rashmi Builders (Accused No. 1) wherein the
proposed Accused No. 4 and Accused No. 5 have been shown as
the partners of the firm and in this view of the matter, it was prayed
that complainant may be permitted to join them as accused.
6. The Judicial Magistrate First Class, Prantij, as noted
above, has directed that Paresh Lakshmikant Vyas and Sarojben
Ashwinkumar Shah (appellant herein) be joined as Accused Nos. 4
and 5 and the High Court maintained such direction.
7. Section 319 of the Code reads as under :

 

“S. 319. Power to proceed against other persons appearing

to be guilty of offence.–(1) Where, in the course of any

inquiry into, or trial of, an offence, it appears from the

evidence that any person not being the accused has

committed any offence for which such person could be

tried together with the accused, the court may proceed

against such person for the offence which he appears to

have committed.

 

(2) Where such person is not attending the court, he

may be arrested or summoned, as the circumstances of’

the case may require, for the purpose aforesaid.

 

(3) Any person attending the court although not under

arrest or upon a summons, may be detained by such

court for the purpose of the inquiry into, or trial of, the

offence which he appears to have committed.

 

(4) Where the court proceeds against any person under

sub-section (1), then-

 

(a) The proceedings in respect of such person shall

be commenced afresh, and witnesses re-heard:

 

(b) Subject to the provisions of clause (a), the case

may proceed as if such person had been an

accused person when the court took cognizance of

the offence upon which the inquiry or trial was

commenced.”

4
8. The ambit and scope of the power of the Court under
Section 319 of the Code has come up for consideration before this
Court on more than one occasion.
9. In Joginder Singh and Another v. State of Punjab and
Another1, this Court stated that the power conferred under Section
319(1) of the Code is applicable to all courts including a Sessions
Court and the Court has power to add any person, not being the
accused before it, against whom there appears during trial
sufficient evidence indicating his involvement in the offence, as an
accused and direct him to be tried along with the other accused.
10. In the case of Municipal Corporation of Delhi v. Ram
Kishan Rohtagi and Others2, this Court (at page 8) held as under :
“19. In these circumstances, therefore, if the

prosecution can at any stage produce evidence which

satisfies the court that the other accused or those who

have not been arrayed as accused against whom

proceedings have been quashed have also committed

the offence the Court can take cognizance against them

and try them along with the other accused. But, we

would hasten to add that this is really an extraordinary

power which is conferred on the court and should be

used very sparingly and only if compelling reasons exist

for taking cognizance against the other person against

whom action has not been taken. More than this we

would not like to say anything further at this stage. We

leave the entire matter to the discretion of the court

concerned so that it may act according to law. We

would, however, make it plain that the mere fact that the

proceedings have been quashed against respondents 2

to 5 will not prevent the court from exercising its

discretion if it is fully satisfied that a case for taking
1 (1979) 1 SCC 345

2 (1983) 1 SCC 1

5
cognizance against them has been made out on the

additional evidence led before it.”

 
11. In Michael Machado and Another v. Central Bureau of
Investigation and Another3, this Court on extensive consideration
of the provision contained in Section 319 stated the (at pages
267-268) as follows :
“11. The basic requirements for invoking the above

section is that it should appear to the court from the

evidence collected during trial or in the inquiry that

some other person, who is not arraigned as an accused

in that case, has committed an offence for which that

person could be tried together with the accused already

arraigned. It is not enough that the court entertained

some doubt, from the evidence, about the involvement

of another person in the offence. In other words, the

court must have reasonable satisfaction from the

evidence already collected regarding two aspects. First

is that the other person has committed an offence.

Second is that for such offence that other person could

as well be tried along with the already arraigned

accused.
12. But even then, what is conferred on the court is only

a discretion as could be discerned from the words “the

court may proceed against such person”. The

discretionary power so conferred should be exercised

only to achieve criminal justice. It is not that the court

should turn against another person whenever it comes

across evidence connecting that other person also with

the offence. A judicial exercise is called for, keeping a

conspectus of the case, including the stage at which the

trial has proceeded already and the quantum of

evidence collected till then, and also the amount of time

which the court had spent for collecting such evidence.

It must be remembered that there is no compelling duty

on the court to proceed against other persons.
xxx xxx xxx xxx xxx

 

 

3 (2000) 3 SCC 262

6
14. The court while deciding whether to invoke the

power under Section 319 of the Code, must address

itself about the other constraints imposed by the first

limb of sub-section (4), that proceedings in respect of

newly-added persons shall be commenced afresh and

the witnesses re-examined. The whole proceedings

must be recommenced from the beginning of the trial,

summon the witnesses once again and examine them

and cross-examine them in order to reach the stage

where it had reached earlier. If the witnesses already

examined are quite large in number the court must

seriously consider whether the objects sought to be

achieved by such exercise are worth wasting the whole

labour already undertaken. Unless the court is hopeful

that there is a reasonable prospect of the case as

against the newly-brought accused ending in being

convicted of the offence concerned we would say that

the court should refrain from adopting such a course of

action.

 
12. In Shashikant Singh v. Tarkeshwar Singh and
Another4, this Court considered the scope of Section 319 of the
Code at page 743 of the Report in the following words:
“9. The intention of the provision here is that where in

the course of any enquiry into, or trial of, an offence, it

appears to the court from the evidence that any person

not being the accused has committed any offence, the

court may proceed against him for the offence which he

appears to have committed. At that stage, the court

would consider that such a person could be tried

together with the accused who is already before the

court facing the trial. The safeguard provided in respect

of such person is that, the proceedings right from the

beginning have mandatorily to be commenced afresh

and the witnesses reheard. In short, there has to be a

de novo trial against him. The provision of de novo trial

is mandatory. It vitally affects the rights of a person so

brought before the court. It would not be sufficient to

only tender the witnesses for the cross-examination of

such a person. They have to be examined afresh. Fresh

examination-in-chief and not only their presentation for

the purpose of the cross-examination of the newly

added accused is the mandate of Section 319(4). The

 

4 (2002) 5 SCC 738

7
words “could be tried together with the accused” in

Section 319(1), appear to be only directory. “Could be”

cannot under these circumstances be held to be “must

be”. The provision cannot be interpreted to mean that

since the trial in respect of a person who was before the

court has concluded with the result that the newly added

person cannot be tried together with the accused who

was before the court when order under Section 319(1)

was passed, the order would become ineffective and

inoperative, nullifying the opinion earlier formed by the

court on the basis of the evidence before it that the

newly added person appears to have committed the

offence resulting in an order for his being brought before

the court.”

 
13. In Krishnappa v. State of Karnataka5, this Court
reiterated what has been repeatedly stated that the power to
summon an accused is an extraordinary power conferred on the
court and should be used very sparingly and only if compelling
reasons exist for taking cognizance against the other person
against whom action has not been taken.
14. In Palanisamy Gounder and Another v. State
represented by Inspector of Police6, this Court referred to two
earlier decisions of this Court in Michael Machado3 and
Krishnappa5 and observed that power under Section 319 of the
Code cannot be exercised so as to conduct a fishing inquiry.
15. In Guriya alias Tabassum Tauquir and Others v. State
of Bihar and Another7 most of the above decisions were referred to
and it was observed that the parameters for dealing with an

 
5 (2004) 7 SCC 792

6 (2005) 12 SCC 327

7 (2007) 8 SCC 224

8
application under Section 319 of the Code have been laid down in
these cases.
16. The legal position that can be culled out from the
material provisions of Section 319 of the Code and the decided
cases of this Court is this :
(i) The Court can exercise the power conferred on it under

Section 319 of the Code suo motu or on an application by

someone.
(ii) The power conferred under Section 319(1) applies to

all courts including the Sessions Court.
(iii) The phrase “any person not being the accused” occurring

in Section 319 does not exclude from its operation an

accused who has been released by the police under

Section 169 of the Code and has been shown in Column 2

of the charge-sheet. In other words, the said expression

covers any person who is not being tried already by the

court and would include person or persons who have been

dropped by the police during investigation but against

whom evidence showing their involvement in the offence

comes before the court.
(iv) The power to proceed against any person, not being the

accused before the court, must be exercised only where

there appears during inquiry or trial sufficient evidence

indicating his involvement in the offence as an accused and

not otherwise. The word `evidence’ in Section 319

contemplates the evidence of witnesses given in court in

the inquiry or trial. The court cannot add persons as

accused on the basis of materials available in the charge-

sheet or the case diary but must be based on the evidence

adduced before it. In other words, the court must be

satisfied that a case for addition of persons as accused, not

being the accused before it, has been made out on the

additional evidence let in before it.
(v) The power conferred upon the court is although

discretionary but is not to be exercised in a routine manner.

In a sense, it is an extraordinary power which should be

used very sparingly and only if evidence has come on

record which sufficiently establishes that the other person

has committed an offence. A mere doubt about
9
involvement of the other person on the basis of the

evidence let in before the court is not enough. The Court

must also be satisfied that circumstances justify and

warrant that other person be tried with the already

arraigned accused.
(vi) The court while exercising its power under Section 319 of

the Code must keep in view full conspectus of the case

including the stage at which the trial has proceeded already

and the quantum of evidence collected till then.
(vii) Regard must also be had by the court to the constraints

imposed in Section 319 (4) that proceedings in respect of

newly – added persons shall be commenced afresh from

the beginning of the trial.
(viii) The court must, therefore, appropriately consider the above

aspects and then exercise its judicial discretion.

 
17. Now, if the order of the High Court is seen, it would
transpire that after noticing the provisions contained in Section
319 and its scope, the High Court proceeded to hold that the order
of the Magistrate did not call for any interference. The High Court,
however, failed to consider whether Magistrate has addressed to
the essential aspects before invoking his power under Section 319
of the Code. Moreover, the High Court did not advert to the
question whether or not filing of copy of registration of the firm by
Accused Nos. 2 and 3 would be covered by expressions `in the
course of any inquiry into or trial’ and `evidence’ occurring in
Section 319 of the Code and also the aspect as to whether such
document could be treated as an evidence to show that the
appellant (newly added accused) has committed an offence of
cheating under Section 420 IPC. As regards the criminal liability of

10
a partner in the firm, in light of the provisions contained in Section
141 of the N.I. Act, there has to be evidence that at the time the
offence was committed, the partner was in-charge of and was
responsible to the firm for the conduct of the business of the firm.
A perusal of the impugned order would show that all these relevant
aspects have not been considered by the High Court at all and the
petitions under Section 482 of the Code were dismissed. As, in
our view, the matter needs to be considered by the High Court
afresh, we refrain from dealing with the orders of the Magistrate on
merit lest it may prejudice the consideration of the petitions under
Section 482 of the Code before the High Court.
18. Consequently, these appeals are allowed and the
impugned order dated May 5, 2010 is set aside. Criminal
Miscellaneous Application Nos. 5157 of 2000, 5158 of 2000, 5159
of 2000 and 5160 of 2000 are restored to the original number for
hearing and reconsideration by the High Court in accordance with
law.

 

 

………………………J.

(Aftab Alam)

 

 

……………………..J.

(R.M. Lodha)
NEW DELHI

AUGUST 10, 2011

11

 

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