Mumbai Court can admit an appeal against company listed in other state for fraud occurred in its jurisdiction
HIGH COURT OF BOMBAY
Western Projects Ltd.
State of Maharashtra
CRIMINAL WRIT PETITION No. 2193 of 2007
June 14, 2012
A. R. Joshi, J – Present writ petition was admitted on 1.2.2008 and earlier granted stay in terms of prayer clause (b) and (c) was continued. Said stay is continuing till today.
2. During the pendency of the writ petition, matter was taken before the Apex Court in S.L.P. (Cri) No.4879/2008 and in that S.L.P. directions were given by the Apex Court for expeditious hearing of the writ petition itself. Under this premise, matter was taken up for final hearing. Heard rival arguments.
3. By the present writ petition, original accused Nos. 13 and 14 i.e. present petitioners have prayed for quashing the proceedings filed against them by original complainant / present respondent No.2.
4. Present respondent No.2 filed Criminal Case No.47/2007 (CC No.66/M/2007) before the Court of Additional Metropolitan Magistrate, Mumbai. An order under Section 156 (3) was passed by the concerned Metropolitan Magistrate’s Court giving directions to the concerned Police to investigate and file F.I.R. As such said F.I.R. was registered under M.E.C.R.No.12/2007 by Cuffe Parade Police Station.
5. The main argument on behalf of the petitioners is two fold. Firstly, that the Metropolitan Magistrate’s Court at Mumbai lack jurisdiction to entertain the criminal proceeding and secondly that there are no specific averments against the present petitioners – accused Nos. 13 and 14 concerning offence of cheating and conspiracy.
6. There is no much substance in the first argument as to aspect of lack of jurisdiction of the Metropolitan Magistrate’s Court to entertain the criminal complaint of respondent No.2. This is so, in view of the factual position as to major transaction between the complainant and the accused took place at Mumbai though the complainant is resident of Rajkot, so also the accused Nos. 1 to 4, 8,9,13 to 18 are resident of Kolkata. The allegations against the accused persons are that they entered into a conspiracy to cheat the complainant – present respondent No.2 in the matter of taking over of a public limited company which is accused No.13. Accused No.14 is the Director of said accused No.13. Admittedly, as per the averments in paragraph No.25 of the complaint No.17/2007 lodged before the Additional Chief Metropolitan Magistrate, Mumbai, initially complainant approached Rajkot police and lodged complaint in respect of the fraud committed by the accused persons in the matter of transfer of shares of accused No.13 – present petitioner No.1. Local police at Rajkot did not take action and directed the complainant to file complaint at Mumbai where major part of illegal transaction took place. So also the crucial part of criminal offence took place in the jurisdiction of SEBI in Mumbai and in view of all the documents relating to the offence were lying at SEBI Mumbai. Considering the over all view as to the allegations in the complaint, the first objection on the point of jurisdiction does not survive and hence same is rejected.
7. So far as the second objection as to no specific averments against accused Nos. 13 and 14 (present petitioners), it is argued by learned senior counsel, Shri Shirish Gupte, for the petitioners that the complaint is vague and does not point out any specific instance of involvement of the petitioners in the act of cheating or fabrication of any evidence, much less entering into a criminal conspiracy with the co-accused. Counter to this argument, learned counsel Shri Thakare brought our attention to the contents of para Nos. 17, 22, 23, 32 and 34 of the complaint and stated that definitely there are allegations made against the present petitioners accused Nos. 13 and 14 as co-conspirators along with other co-accused. Factually, this submission is correct on perusal of the respective paragraphs of the complaint. Moreover, considering the nature of transaction entered into between the parties and the allegations against the accused persons including present petitioners, it is not warranted at the stage of filing of the complaint i.e. at the threshold of initiation of the proceeding against the accused that each and every detail as to the involvement of accused persons is required to be spelt out. In support of this submission, ratios propounded by the following authorities were taken shelter of on behalf of respondent No.2 – original complainant.
(i) State of Bihar v. Rajendra Agrawalla (1996) 8 Supreme Court Cases 164
(ii) Col. B.S. Khatri v. State of Maharashtra 2004 (1) Mh.L.J.747
8. The ratio of these authorities spell as to under which circumstances recourse to section 482 of Cr.P.C. can be taken. In the said authorities, it has been made clear that said power should be very sparingly and cautiously exercised and at that stage the High Court should not sift or appreciate the evidence and come to the conclusion that no prima facie case is made out.
(iii) Mahavir Prashad Gupta and another v. State of National Capital Territory of Delhi (2000) 8 Supreme Court Cases 115
9. In this authority, the Apex Court had observed that the powers under Article 226 of the Constitution should be exercised with circumspection and only in rarest of the rare case such as where the complaint does not disclose any offence.
10. Considering the ratio propounded in the above three authorities, needless to mention that roving inquiry as to pros and cons of the merits of the case is not necessary and while exercising the jurisdiction under Article 226 of the Constitution of India and under Section 482 of the Code, one should not embark on the inquiry as to genuineness of allegations made in the complaint or whether these allegations were likely to be established on evidence or not. Suffice it to say that the case as to involvement of a particular accused in an offence of cheating and conspiracy as in the present case, if mentioned in the complaint without giving much details, would not be a ground for quashing the entire complaint as against the particular accused persons. In this view of the matter, there is nothing to entertain the present writ petition and same is accordingly dismissed. Rule stands discharged.