2023 (9) TMI 584 - HC - Customs

Loss of reputation / Defamation - Allegation of Smuggling - 30, 24, 000 sticks of cigarettes - allegation of illegal import/smuggling of foreign cigarettes by concealing the same in the cargo - HELD THAT - In the instant case as per the allegations made in the complaint the petitioner is said to have played deception against the respondents and induced them to process customs clearance formalities which they would not have done if they were not induced and as a result the DRI found in the impugned consignment that cigarettes were being smuggled and due to that the second respondent was also roped in as an accused who suffered harm to body mind and reputation. Thus the ingredients of the offence of cheating are prima facie made out on a reading of the complaint along with other materials. In the instant case none of the ingredients under Section 499 of the IPC is satisfied. The loss of reputation of the respondents by itself will not constitute an offence of defamation. Such loss of reputation is also one of the ingredients in the offence of cheating. This Criminal Original Petition is partly allowed and the cognizance taken by the Court below for the offence under Section 500 of the IPC is set aside.

Summary

Issues involved: Allegations of cheating and causing wrongful loss leading to criminal complaints under Sections 415, 420, 499, and 500 of the Indian Penal Code (IPC).

Allegations and Background:
The respondents filed a complaint against the petitioner, alleging that the petitioner induced them to process customs clearance for imported goods, resulting in the discovery of concealed cigarettes during inspection by the Directorate of Revenue Intelligence (DRI). This led to the arrest and incarceration of the second respondent, causing harm to reputation and financial loss to the respondents.

Petitioner's Argument:
The petitioner contended that the offences alleged were not made out, as both parties were found guilty by the DRI, and the respondents' defense in DRI proceedings should not translate into criminal complaints.

Respondents' Position:
The respondents argued that the petitioner intentionally misled them about the cargo, leading to their involvement in customs clearance and subsequent legal issues, causing financial loss and damage to reputation.

Court's Analysis:
The Additional Commissioner found that the petitioner orchestrated the smuggling of cigarettes in the cargo, deceiving the respondents who trusted the documents provided. The Court noted that the elements of cheating under Section 415 of the IPC were prima facie established based on the complaint and evidence.

Legal Considerations:
For the offence of cheating under Section 415 of the IPC, deception leading to harm or damage is essential. In this case, the petitioner's actions induced the respondents to process customs clearance, resulting in harm and financial loss, meeting the criteria for cheating.

Decision:
The Court partially allowed the petition, setting aside the cognizance for the offence under Section 500 of the IPC but sustaining it for Section 420. The lower court was directed to proceed with the complaint under Section 420 and complete the proceedings within four months.

Conclusion:
The Court found the allegations of cheating substantiated based on the petitioner's deceptive actions, leading to financial loss and harm to reputation for the respondents. The case will proceed for the offence under Section 420 of the IPC, emphasizing the need for a timely resolution.