Ceo, Maruti Suzuki India Ltd. & Anr. vs Ajay Mallick & Ors.

The revisional application is taken up for hearing.

Heard learned advocates appearing on behalf of the appearing parties.

The petitioners being the Chief Executive Officers of M/s Maruti Suzuki India Limited and Chief Executive Officer of West Bengal Regional Office have challenged the order dated 27.07.2016 passed by the learned Additional Chief Judicial Magistrate, Durgapur in connection with CRR No. 493 of 2016 on the grounds inter alia that cognizance was taken by the learned Magistrate against the petitioners and one another without applying his judicial mind and without taking into consideration of the fact that the respondent no. 1/complainant had made out no criminal case as per the allegation in the complaint against the petitioners. It is understood from the order impugned that on preliminary examination of the complaint on solemn affirmation the learned ACJM, Durgapur by his order dated 27.07.2016 issued process of the Court against the petitioners and one General Manager of SWG Car World, Durgapur as accused persons in the case.

The background leading to the case is that the complainant/ respondent no 1 being the owner of the Maruti Suzuki Car with the registration number WB 44B 8287 met with an accident on 16.08.2015 which was handed over to the respondent no. 2 for repairing. The job sheet was opened and the O.P.No. 2 gave the delivery date as on 30.09.2015 which was extended to 05.10.2015 and further extended to 19.10.2015. The complainant had alleged that he met one Rajib Chakraborty, the Service Manager of respondent no. 2 on 19.10.2015 and asked the reason for delay in repair of the car in question. It is also alleged in the complaint that the said Service Manager after consulting the technician gave another dated i.e. on 26.12.2015 with an assurance that the repair work will be completed by the given date with promise to deliver the car and till then another car will be given for temporary use and promise to deliver car on February 22, 2016. It is alleged that the respondent no. 2 as well as some other staff humiliated the complainant with filthy language and assaulted him. The complainant further alleged that the respondent no. 2 has no intention to return the car. Lastly the complainant requested them to deliver his car but the car was not there and the respondent no. 2 held out threat on him and told him that he should not visit the work shop without prior intimation. Thus the complaint was filed before the ACJM, Durgapur alleging offence under Section 405/415/427/506 and 34 of the Indian Penal Code against the accused persons including the present petitioners.

My attention is invited by Mr. Sabyasachi Banerjee, learned counsel for the petitioners that they are no way connected with the alleged commission of offence. Secondly, that the learned Magistrate has passed a very routine order in a very mechanical manner by taking cognizance under Sections 406, 415, 323, 506 IPC against the petitioners. Mr. Banerjee submits that Section 415 IPC is the definition clause of cheating defining the term cheating whereas the conviction clause relating to offence punishable for cheating is provided under Section 417 of Indian Penal Code to argue that the learned Magistrate has mechanically issued the process without application of judicious mind.

It is submitted that petitioner no. 1 being the CEO and Managing Director of M/s. Maruti Suzuki India Ltd. and petitioner no. 2 being CEO of Regional Office in West Bengal, they are no way related to the alleged offence as they cannot be held liable for the affairs of the respondent no. 3 viz the General Manager, SWG Car World Durgapur.

In rebuttal, Mr. Subrata Bhattacharjee, learned counsel for the complainant/respondent no. 1 submits that a complaint was registered with the M/s. Maruti Suziki India Ltd. being the petitioners but they have not responded to the said complaint. That apart, the respondent no. 2 happens to be the dealer of the petitioners' company. So they are vicariously liable for the acts and deeds of the respondent no. 2. To counter the said submissions, Mr. Banerjee referred to a decision in the case of Maksud Saiyed -v.- State of Gujarat & Ors., reported in (2008) 2 SCC(Cri) 692 wherein the Hon'ble Supreme Court has made the observation thus :-

" Where a jurisdiction is exercised on a complaint petition filed in terms of Section 156(3) or Section 200 of the Code of Criminal Procedure, the Magistrate is required to apply his mind. The Penal Code does not contain any provision for attaching vicarious liability on the part of the Managing Director or the Directors of the Company when the accused is the Company. The learned Magistrate failed to pose unto himself the correct question viz. as to whether the complaint petition, even if given face value and taken to be correct in its entirety, would lead to the conclusion that the respondents herein were personally liable for any offence. The bank is a body corporate vicarious liability of the Managing Director and Director would arise provided any provision exists in that behalf in the statute. Statues indisputably must contain provision fixing such vicarious liabilities. Even for the said purpose, it is obligatory on the part of the complainant to make requisite allegations which would attract the provisions constituting vicarious liability."

Reference is also made to a decision in the case of Maharashtra State Electricity Distribution Company Limited & Anr. v. Datar Switchgear Limited & Ors., reported in (2011) 1 SCC(Cri) 68 relying on observations in paragraphs 27 and 31 wherein the Hon'ble Supreme Court has observed:-

A bare perusal of the complaint shows that the gravamen of the allegation is that a fabricated document containing the offending endorsement was tendered in evidence before the Arbitral Tribunal on behalf of MSEB by Accused 6, who was in charge of Shirpur Section. It is evident from the aforeextracted paragraphs of the complaint that other accused have been named in the complaint because, according to the complainant, MSEB, Accused 1 was acting under their control and management. It bears repetition that the only averment made against Appellant 2 in that Appellant 1 i.e. MSEB was acting under the control and management of Appellant 2 along with other three accused. There is no denying the fact that Appellant 2 happened to be the Chairman of MSEB at the relevant time but it is a settled proposition of law that one cannot draw a presumption that a Chairman of a company is responsible for all acts committed by or on behalf of the company. In the entire body of the complaint there is no allegation that Appellant 2 had personally participated in the arbitration proceedings or was monitoring them in his capacity as the Chairman of MSEB and it was at his instance that the subject interpolation was made in Ext. C-64.

Therefore, we are of the view that even the Board resolution, adduced by the complainant, does not establish that Appellant 2 was involved in the alleged fabrication of false evidence or adducing the same in evidence before the Arbitral Tribunal. In the absence of any such specific averment demonstrating the role of Appellant 2 in the commission of the offence, we find it difficult to hold that the complaint, even assuming it to be correct in its entirety, discloses the commission of an offence by Appellant 2 under Sections 192 and 199 IPC."

It is tried to law that wherever by a legal fiction principle of vicarious liability is attracted it has to be specifically provided in the statute concerned- neither Section 192 nor Section 199 IPC incorporate principle of vicarious liability- therefore, it is incumbent on complainant to specifically aver role of each of the accused in complaint.

I have gone through the complaint lodged by the respondent no. 1 that there is no specific averment made in the complaint itself.

Mr. Banerjee further relied on a decision in the case of Sunil Bharti Mittal v. Central Bureau of Investigation; reported in (2015) 4 SCC 609 to argue that if the person or group of persons who control the affairs of the company commit an offence with a criminal intent, their criminality can be imputed to the company as well as they are "alter ego" of the company but this is not the case before hand where there is no averment in the complaint specifically mentioning role of the petitioners in respect of the alleged offence against the petitioners who happen to be the Chief Executive Officer, Maruti Suzuki India Limited and another being CEO, Regional Office, Kolkata.

Therefore, by taking cue from the above cited decisions of the Hon'ble Supreme Court the principles of vicarious liability as against the petitioners, it cannot be said that they are anyway vicariously liable for the commission of offence under Sections 406/323/506 IPC. The observation as made in this count by the Hon'ble Supreme Court at pages 42,43,44,49,50, 51,52 and 53 which are reproduced for useful consideration.

" 42 No doubt, a corporate entity is an artificial person which acts through its officers, Directors, Managing Director, Chairman, etc. If such a company commits an offence involving mens rea, it would normally be the intent and action of that individual who would act on behalf of the company. It would be more so, when the criminal act is that of conspiracy. However, at the same time, it is the cardinal principle of criminal jurisprudence that there is no vicarious liability unless the statute specifically provides so.

Thus, an individual who has perpetrated the commission of an offence on behalf of the company can be made an accused, along with the company, if there is sufficient evidence of his active role coupled with criminal intent. Second situation in which he can be implicated is in those cases where the statutory regime itself attracts the doctrine of vicarious liability, by specifically incorporating such a provision.

When the company is the offender, vicarious liability of the Directors cannot be imputed automatically, in the absence of any statutory provision to this effect. One such example is Section 141 of the Negotiable Instruments Act, 1881. In Aneeta Hada, the Court noted that if a group of persons that guide the business of the company have the criminal intent, that would be imputed to the body corporate and it is in this backdrop, Section 141 of the Negotiable Instruments Act has to be understood. Such a position is, therefore, because of statutory intendment making it a deeming fiction. Here also, the principle of " alter ego", was applied only in one direction, namely, where a group of persons that guide the business had criminal intent, that is to be imputed to the body corporate and not the vice versa. Otherwise, there has to be a specific act attributed to the Director or any other person allegedly in control and management of the company, to the effect that such a person was responsible for the acts committed by or on behalf of the company.

Cognizance of an offence and prosecution of an offender are two different things. Section 190 of the Code empowered taking cognizance of an offence and not to deal with offenders. Therefore, cognizance can be taken even if offender is not known or named when the complaint is filed or FIR registered. Their names may transpire during investigation or afterwards.

Person who has not joined as accused in the charge-sheet can be summoned at the stage of taking cognizance under Section 190 of the Code. There is no question of applicability of Section 319 of the Code at this stage ( see SWIL Ltd. v . State of Delhi). It is also trite that even if a person is not named as an accused by the police in the final report submitted, the Court would be justified in taking cognizance of the offence and to summon the accused if it feels that the evidence and material collected during investigation justifies prosecution of the accused ( see Union of India v. Prakash P. Hinduja). Thus, the Magistrate is empowered to issue process against some other person, who has not been charge-sheeted, but there has to be sufficient material in the police report showing his involvement. In that case, the Magistrate is empowered to ignore the conclusion arrived at by the investigating officer and apply his mind independently on the fact emerging from the investigation and take cognizance of the case. At the same time, it is not permissible at this stage to consider any material other than that collected by the investigating officer.

On the other hand, Section 204 of the Code deals with the issue of process, if in the opinion of the Magistrate taking cognizance of an offence, there is sufficient ground for proceeding. This section relates to commencement of a criminal proceeding. If the Magistrate taking cognizance of a case ( it may be the Magistrate receiving the complaint or to whom it has been transferred under Section 192), upon consideration of the materials before him ( i.e. the complaint, examination of the complainant and his witnesses, if present, or report of inquiry, if any), thinks that there is a prima facie case for proceeding in respect of an offence, he shall issue process against the accused.

A wide discretion has been given as to grant or refusal of process and it must be judicially exercised. A person ought not to be dragged into Court merely because a complaint has been filed. If a prima facie case has been made out, the Magistrate ought to issue process and it cannot be refused merely because he thinks that it is unlikely to result in a conviction.

However, the words " sufficient ground for proceeding" appearing in Section 204 are of immense importance. It is these words which amply suggest that an opinion is to be formed only after due application of mind that there is sufficient basis for proceeding against the said accused and formation of such an opinion is to be stated in the order itself. The order is liable to be set aside if no reason is given therein while coming to the conclusion that there is prima facie case against the accused, though the order need not contain detailed reasons. A fortiori, the order would be bad in law if the reason given turns out to be ex facie incorrect."

Having taken the cue from the observation made by the Hon'ble Supreme Court and in consideration of the cardinal principle of law that when commission of offence can only be alleged as against the Director of

the company and only when he is said to have been in the affairs of the company and not otherwise.

As I have already discussed hereinabove that the complaint on its plain reading is devoid of any allegation as against the present petitioners being the CEO of M/s. Maruti Suzuki India Limited. I do not find that why the cognizance was taken against all the accused persons arrayed in the complaint. On perusal of the order impugned and judging from the fact discussed above, I am of the opinion that no criminality can be imputed against the petitioners in respect of the alleged offence.

Accordingly, I find that the learned Additional Chief Judicial Magistrate has failed to apply his judicious mind while taking cognizance in respect of the offences and the orders appears to have been written very routinely and perhaps by his bench clerk and he is only signatory to the order.

In the context above, the learned Chief Judicial Magistrates and the learned Additional Chief Judicial Magistrates of the State be directed suitably to see that the cognizance of an offence should not be in a cavalier manner. Ergo finding no allegation as against the present petitioners the cognizance taken vide order dated July 27, 2016 passed by the Additional Chief Judicial Magistrate, Durgapur in connection with CR 493 of 2016 be treated as set aside qua the petitioners and their names be deleted and dropped from the complaint case. Consequently, the summons issued upon them be treated as recalled.

Let a copy of this judgement be sent through the learned Registrar General to all the learned Chief Judicial Magistrates and Additional Chief Judicial Magistrates of the State and learned Chief Metropolitan Magistrates and Additional Chief Metropolitan Magistrates Kolkata District.

Accordingly, the revisional application being CRR 520 of 2017 is disposed of.

Urgent xerox certified copy of this order, if applied, be given to the parties after completion of all legal formalities.