2025 (5) TMI 1685 - SC - Indian Laws

Seeking discharge of the accused - wrongful gain through conspiracy and forgery to defraud the Cotton Corporation of India (CCI) and the farmers - Non-compliance with the discretionary limits as set out under section 239 of the CrPC - allegations vis- -vis the lack of grounds for framing or not framing charges - HELD THAT - We do not intend to refer to too many precedents on a well-established proposition of law on the method and mode of exercising jurisdiction by a magistrate under section 239 of the CrPC. It is correct that Union of India v. Prafulla Kumar Samal and another 1978 (11) TMI 151 - SUPREME COURT . lays down the standard for discharge of an accused under section 239 of the CrPC. The application of the principle for the documents relied upon by the special court and the High Court is both debatable. Discharge under the CrPC is salutary and the magistrate through the expression used in these sections is under an obligation to discharge the accused where from the chargesheet and the appended documents it is noticed that the trial of such charges is worthless. Therefore to sustain the exercise of discretion the order of discharge conforms to the requirements of these sections. The jurisdiction conferred on the magistrate by section 239 of the CrPC is appreciated from the language of the said provision. In a civil suit the triable issues of fact or law are culled from a material proposition of fact or law affirmed by one party and denied by the other and the issue in a civil suit is an admixture of a case to parties to the lis. In contrast section 239 of the CrPC which deals with the trial of warrant cases by a magistrate confines the examination to the final report and documents sent with it under section 173 of the CrPC. The allegations in the FIR transformed through investigation and the collection of evidence are shaped into a final report. This receives the attention of the magistrate to decide whether the charge so presented against the accused is groundless. The salutary duty fastened on the magistrate is exercised not only for aborting unwanted and groundless prosecutions but also for ensuring the continuation of prosecution of a final report with documents presenting a triable charge. Considering the importance of either discharging the accused or continuing the prosecution the magistrate neither acts as a post office nor conducts a mini-trial of the report and the documents before it while exercising the power under section 239 of the CrPC. Stated briefly the learned magistrate in sufficient measure examines the report and documents while taking a decision for discharge or for proceeding with the prosecution. We propose to examine whether the order impugned before us withstands the scrutiny and requirement of this Court. However since the order of discharge is amenable to the jurisdiction of the revisional court the order of discharge must speak for itself and only a warranted conclusion is arrived at by the magistrate. The deviation from the discretionary limits definitely attracts the supervisory jurisdiction of the revisional courts. The issue of whether discharge is warranted or trial is continued depends on the circumstances of each case. Reverting to the circumstances of this case it is borne out by the record that the plea for discharge is founded on the correspondence dated 08.01.2007 and 31.01.2007. Thereafter by referring to the very gist of the communication prayer for discharge has been made. In clear terms and reasoning the discharge has been ordered not by referring to any of the situations referred in section 239 of the CrPC but by relying on the documents made available by the accused. The procedure followed by the trial court and as confirmed by the High Court is patently illegal and contrary to the binding precedent. The passing remark by the High Court in the common order that there is no material for cheating and forgery belies the existence of allegations and documents. The consideration of material i.e. chargesheet and list of documents in the background of allegations made against the accused is the available path for discharge by the special court and the High Court. But a path unavailable to the special court and the High Court is the consideration of material invited at the instance of the defence for ordering discharge. The orders impugned proceed on the assumption of the absence of loss to the CCI on the basis of the letter dated 31.01.2007. The case of prosecution established looks at wrongful gain through conspiracy and forgery to defraud the CCI and the farmers to the tune of Rs.21, 19, 35, 646/-. Non-compliance with the discretionary limits as set out under section 239 of the CrPC warrants the interference of this Court. Hence for the above discussion and reasons the orders impugned are set aside and the prayer for discharge of the accused by looking at the documents brought on record is set aside. Consequently the Criminal MPs filed by the accused are dismissed. The special court is directed to exercise its jurisdiction in terms of section 239 of the CrPC particularly uninfluenced by any of the observations made in this Judgment and decide whether a case for discharge is available or charges are to be framed for trial of the alleged offences. The Criminal Appeals are allowed. Pending applications if any are disposed of accordingly.

Summary

The core legal questions considered in this judgment include:

1. Whether the special court and High Court erred in discharging the accused at the stage of framing charges under section 239 of the Criminal Procedure Code (CrPC), 1973, particularly on the basis of documents summoned by the defence and a letter from the Cotton Corporation of India (CCI) stating no loss was caused.

2. The scope and limits of the magistrate's jurisdiction under section 239 CrPC in considering material beyond the chargesheet and documents submitted by the prosecution under section 173 CrPC.

3. The applicability of the principles governing discharge of accused persons at the threshold stage, including the evaluation of prima facie evidence, the role of the court in weighing evidence, and the prohibition against conducting a mini-trial at this stage.

4. Whether the prosecution's allegations of conspiracy, cheating, forgery, and wrongful gain/loss under the Prevention of Corruption Act and Indian Penal Code (IPC) raise a triable case warranting framing of charges.

5. The effect and evidentiary value of the CCI's letter denying loss or procedural violations on the continuance of prosecution.

Detailed analysis issue-wise:

1. Legality of the discharge orders under section 239 CrPC:

The relevant legal framework includes section 239 CrPC, which permits discharge of accused if the charge is found to be groundless after considering the police report and documents filed under section 173 CrPC. The Court referenced precedents including State of Orissa v. Debendranath Padhi, which clarified that at the stage of framing charges, the court must consider only the chargesheet and accompanying documents submitted by the prosecution. The accused is not entitled to file additional material or documents at this stage, and the court must not conduct a mini-trial or assess the defence merits.

The Court emphasized that the magistrate's function is to determine whether the prosecution's material, taken at face value and after sifting for broad probabilities, discloses a prima facie case. The Court cited precedents reiterating that inconsistencies or contradictions in prosecution material cannot justify discharge without trial, and that the defence cannot be considered at this stage.

In the present case, the special court and High Court relied heavily on a letter dated 31.01.2007 from the CCI, which stated that no loss was caused by the accused and that purchases were made in compliance with MSP guidelines. This letter was summoned by the accused through a criminal miscellaneous petition and was not part of the prosecution's original chargesheet material.

The Court held that reliance on such defence-invited documents at the stage of framing charges is illegal and contrary to binding precedents. The discharge orders effectively amounted to an acquittal on merits without trial, exceeding the statutory discretionary jurisdiction under section 239 CrPC. The Court found the procedure followed by the lower courts patently illegal and set aside the discharge orders.

2. Scope of material to be considered at framing of charges:

The Court extensively analyzed the statutory scheme and precedents to clarify that the magistrate's jurisdiction under sections 227/239 CrPC is confined to the police report and documents submitted by the prosecution under section 173 CrPC. The accused cannot file material or invoke section 91 CrPC at this stage. The magistrate must not conduct a roving or fishing inquiry or consider the defence's case. The hearing of the accused's submissions is limited to the prosecution material on record.

The Court reiterated that the magistrate's duty is salutary: to discharge accused where the prosecution case is worthless, or proceed to trial where a triable case exists. The magistrate must not act as a "post office" merely forwarding the chargesheet but must sift evidence for broad probabilities without conducting a mini-trial.

3. Evaluation of prosecution's allegations and evidence:

The prosecution alleged a conspiracy involving the accused to subvert the Minimum Support Price (MSP) scheme by purchasing cotton at lower market rates before MSP announcement, hoarding it, and then selling it to the CCI at MSP through benami farmers who had insufficient or no land holdings. The modus operandi included opening bank accounts in farmers' names, forging signatures on weighment slips and bidding documents, and diverting payments. The prosecution claimed wrongful loss to the CCI/Government of over Rs. 21 crore and corresponding wrongful gain to the accused.

The chargesheet detailed the alleged conspiracy, discrepancies in land holdings versus cotton sold, forensic evidence of forgery, and the role of various accused including the CPO, his son, and others. The prosecution contended that the MSP was intended solely for genuine cotton farmers and that the accused manipulated the system for personal gain.

The accused challenged the chargesheet as groundless, relying on the CCI's letter denying loss or procedural violations, absence of direct evidence of forgery or cheating, and jurisdictional objections. They claimed to be bona fide farmers, some cultivating leased lands, and denied wrongdoing.

The special court and High Court accepted the CCI's letter as exonerating evidence and found no grave suspicion warranting trial. However, the Supreme Court clarified that the letter was a defence-invited document and could not be considered at the framing stage. The Court did not decide on the merits but held that the prosecution's material prima facie disclosed a triable offence requiring framing of charges.

4. Treatment of competing arguments:

The Court carefully balanced the prosecution's detailed chargesheet and documentary evidence against the accused's reliance on the CCI's letter and assertions of innocence. It recognized the importance of the MSP scheme's objective to benefit genuine farmers and the serious nature of allegations involving conspiracy, forgery, and cheating.

While acknowledging the accused's contentions, the Court emphasized that such disputes of fact and credibility are to be tested at trial and not at the threshold stage of framing charges. The Court rejected the lower courts' approach of treating the discharge application as an acquittal on merits and relying on defence-sourced documents to negate the prosecution's case.

5. Final conclusions and directions:

The Supreme Court set aside the discharge orders passed by the special court and affirmed by the High Court, holding them to be illegal and contrary to settled law. It dismissed the criminal miscellaneous petitions filed by the accused and directed the special court to exercise its jurisdiction afresh under section 239 CrPC uninfluenced by the impugned orders or the CCI letter.

The Court clarified that the special court must decide whether the charges are to be framed or the accused discharged based solely on the prosecution's chargesheet and materials, without considering defence-invited documents or conducting a mini-trial. The matter was remitted for fresh consideration accordingly.

Significant holdings and core principles established include:

"The accused at the stage of framing of charge does not have a right to file material or documents. It is apt to excerpt ... that the plea of alibi taken by the accused may have to be examined at the stage of framing of charge if the contention of the accused is accepted despite the well-settled proposition that it is for the accused to lead evidence at the trial to sustain such a plea. The accused would be entitled to produce materials and documents in proof of such a plea at the stage of framing of the charge, in case we accept the contention put forth on behalf of the accused. That has never been the intention of the law well settled for over one hundred years now."

"The learned magistrate ... neither acts as a post office nor conducts a mini-trial of the report and the documents before it while exercising the power under section 239 of the CrPC."

"The order of discharge must speak for itself, and only a warranted conclusion is arrived at by the magistrate. The deviation from the discretionary limits definitely attracts the supervisory jurisdiction of the revisional courts."

"The procedure followed by the trial court and as confirmed by the High Court is patently illegal, and contrary to the binding precedent."

"The case of prosecution established looks at wrongful gain through conspiracy and forgery to defraud the CCI and the farmers to the tune of Rs.21,19,35,646/-. Non-compliance with the discretionary limits as set out under section 239 of the CrPC warrants the interference of this Court."

In sum, the Court underscored that the threshold for framing charges is whether the prosecution's material, taken at face value, discloses a triable offence. Defence evidence or documents summoned by the accused cannot be used to negate the prosecution's case at this stage. The discharge orders based on such impermissible considerations were quashed, and the trial court was directed to reconsider framing charges strictly in accordance with the law.