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Ashok Sadarangani & anr. Versus Union of India & ors.

2012 (3) TMI 587 - SUPREME COURT OF INDIA

Offence which is not compoundable under the provisions of the Criminal Procedure Code, 1973 - we are not inclined to grant the reliefs prayed for in the writ petition and the same is accordingly dismissed. - Writ Petition (Crl.) No. 26 of 2011 - Dated:- 14-3-2012 - Altamas Kabir And J. Chelameswar, JJ. JUDGMENT Altamas Kabir, J. 1. The issue which has been raised in this writ petition is whether an offence which is not compoundable under the provisions of the Criminal Procedure Code, 1973, herei .....

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Guarantee facility of ₹ 20 lacs and Forward Contracts upto a limit of ₹ 300 lacs, were sanctioned and such decision was conveyed to the Petitioner No.1 by the Bank by its letter dated 7th July, 1999. On 16th October, 1999, the Bank sought additional collateral security of ₹ 56 lacs from the Petitioner No.1, who, on 29th December, 1999, submitted a Lease Deed dated 29th December, 1999, in respect of an immovable property leased to M/s. Nitesh Amusements Pvt. Ltd. by Shri Homi D .....

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Letters of Credit, including Bills of Lading, Invoice and Bills of Exchange, were accepted and collected by the Petitioner No.1 on behalf of the firm from the Bank and he undertook to make payment on the due date. However, the Petitioners defaulted in payment of their liability of about 188 lacs towards the Bank. On 10th April, 2003, R.C.No.3/E/2003/CBI/EOW/MUM in Case No.3/CPW/2004, was registered at the behest of the Bank of Maharashtra. On 30th June, 2003, on the complaint of the Union Bank .....

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gotiate the Letters of Credit in favour of foreign suppliers and also by misusing the Cash Credit facility. 4. Charge-sheet was filed in the said Special Case No.3 of 2004 on 14th January, 2004. At about the same time, a criminal case, being No.236 of 2001, was registered against Shri Kersi Mehta and others under Section 120-B, r/w 465, 467, 468 and 471 of the Indian Penal Code, hereinafter referred to as the "IPC". The said case was registered primarily on the accusation that Shri Ker .....

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h the relief sought for was for a direction upon Shri Kersi Mehta to deliver up to the Court the said two Powers of Attorney for cancellation of the same. 6. It is a matter of record that, although, the Petitioner No.1 has surrendered and is on bail and facing trial, the Petitioner No.2 is yet to be arrested in connection with the case. 7. While the criminal case against the Petitioners was proceeding, the Union Bank of India wrote to the Petitioner No.1 on 27th September, 2010, offering a One-T .....

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gainst the borrowers/guarantors. As has been submitted during the course of hearing of the writ petition, pursuant to such offer of One-Time Settlement, dues of both the Banks have been cleared by the Petitioners and they have, therefore, entered into a compromise with the Petitioners indicating that they had no further claim against the Petitioners. 8. It is in this background that a separate application was made in the writ petition, being Criminal Misc. Petition No.1110 of 2012, for stay of f .....

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upport of the writ petition, Shri Mukul Rohatgi, learned Senior Advocate, submitted that the issue, which has fallen for consideration in the writ petition, has been considered in great detail in several decisions of this Court. Learned counsel submitted that in some cases this Court had exercised its powers under Article 142 of the Constitution of India to quash proceedings which were not compoundable, but the common thread which runs through almost all the judgments is that the power to interf .....

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f Investigation, SPE, SIU(X), New Delhi Vs. Duncans Agro Industries Ltd., Calcutta [(1996) 5 SCC 591], in which the provisions of Section 320 Cr.P.C. were considered in regard to offences which constituted both civil and criminal wrong, including the offence of cheating. In the said case, this Court while considering the aforesaid issue held that compromise in a civil suit for all intents and purposes amounted to compounding of the offence of cheating. Furthermore, in the said case, the investig .....

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h one of us (Kabir, J.) was a party. In the said case, what was urged was that though an offence may not be compoundable, it did not take away the powers of this Court to quash such proceedings in exercise of its inherent jurisdiction under Article 142 of the Constitution, and even Section 320 Cr.P.C. could not fetter such powers, as had been earlier held in B.S. Joshi Vs. State of Haryana [(2003) 4 SCC 675]. It had also been contended on behalf of the Union of India that the power under Article .....

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ecision in B.S. Joshi's case and the compromise arrived at between the company and the Bank and the consent terms, this Court took the view that technicality should not be allowed to stand in the way of quashing of the criminal proceedings, since the continuance of the same after the compromise had been arrived at between the parties, would be a futile exercise. Reference was also made to another decision of this Court in Manoj Sharma Vs. State & Ors. [(2008) 16 SCC 1], where following t .....

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so the question of quashing of proceedings relating to non-compoundable offences after a compromise had been arrived at between the rival parties, was under consideration. After examining the powers of the High Court under Section 482 Cr.P.C., the learned Judges came to the conclusion that in the facts and circumstances of the case, the continuance of proceedings would be nothing but an empty formality and that Section 482 Cr.P.C. in such circumstances could be justifiably invoked by the High Co .....

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harma's case (supra), gave sufficient indication that the powers under Article 142 of the Constitution, as far as the Supreme Court is concerned, and Section 482 Cr.P.C., as far as the High Courts are concerned, could not be fettered by reason of the fact that an offence might not be compoundable but in its own facts was capable of being quashed. 14. On the other hand, learned Additional Solicitor General, Shri Mohan Jain, urged that even if the Banks and the Petitioners had settled their di .....

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may seem to be, it is more than a coincidence that the Petitioners offered as security a leasehold property which had been acquired from one Shri Kersi Mehta, who had used a Power of Attorney alleged to have been executed by Shri Homi D. Sanjana and his family members and in respect whereof a criminal case had been filed by Shri Homi against the said Kersi Mehta and the writ petitioners. Shri Jain contended that the entire transaction was based on a fraud perpetrated on Shri Homi D. Sanjana and .....

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r question raised was regarding the continuance of the criminal proceedings after settlement and repayment of a loan, wherein it was held that where settlement is arrived at by and between the creditor bank and debtor, the offence committed as such, does not come to an end. The judgment of a tribunal in civil proceedings and, that too, when it is rendered on the basis of the settlement entered into between the parties, would not be of much relevance in a criminal proceeding in view of the provis .....

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ndia is not in dispute, but that exercise of such power would depend on the facts and circumstances of each case. After referring to the decision in Nikhil Merchant's case (supra), this Court also held that the High Court, in exercise of its jurisdiction under Section 482 Cr.P.C. and the Supreme Court in terms of Article 142 of the Constitution, would ordinarily direct the quashing of a charge involving a crime against society, particularly, when both quashing of a case, continuance whereof .....

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), the Court, while placing reliance on the decision in Rumi Dhar's case (supra), observed that while the jurisdiction of the Court under Article 142 of the Constitution was not in dispute, the exercise of such power would, however, depend on the facts and circumstances of each case. 16. The learned Additional Solicitor General contended that having regard to the divergent views expressed by different Benches of this Court, when the same issue surfaced in Gian Singh Vs. State of Punjab & .....

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reference to a larger Bench, this Court should abstain from pronouncing judgment on the issue which was the subject matter in the said reference. Shri Jain urged that in the circumstances mentioned hereinabove, no relief could be given to the Petitioners on the writ petition and the same was liable to be dismissed. 17. Having carefully considered the facts and circumstances of the case, as also the law relating to the continuance of criminal cases where the complainant and the accused had settl .....

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he process of court and an exercise in futility, since the trial could be prolonged and ultimately, may conclude in a decision which may be of any consequence to any of the other parties. Even in Sushil Suri's case on which the learned Additional Solicitor General had relied, the learned Judges who decided the said case, took note of the decisions in various other cases, where it had been reiterated that the exercise of inherent powers would depend entirely on the facts and circumstances of .....

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case, as also Manoj Sharma's case, deal with a situation which is different from that of the present case. While in the cases referred to hereinabove, the main question was whether offences which were not compoundable, under Section 320 Cr.P.C. could be quashed under Section 482 Cr.P.C., in Gian Singh's case the Court was of the view that a non-compoundable offence could not be compounded and that the Courts should not try to take over the function of the Parliament or executive. In fac .....

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h Court can exercise power under Section 482 Cr.P.C. to do real and substantial justice and to prevent abuse of the process of Court when exceptional circumstances warranted the exercise of such power. Once the circumstances in a given case were held to be such as to attract the provisions of Article 142 or Articles 32 and 226 of the Constitution, it would be open to the Supreme Court to exercise its extraordinary powers under Article 142 of the Constitution to quash the proceedings, the continu .....

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