Darshan Singh vs State of Punjab

Pritpal Singh, J.

Darshan Singh petitioner has applied under section 482 of the Code of Criminal Procedure for quashing First Information Report No. 61, dated 29th April, 1983, recorded at Police Station, Saddar, Ropar, against him under sections 4 and 5 of the Prize Chits and Money Circulation Schemes. (Banning) Act, 1978 (hereinafter referred to as the Act). The impugned first information report is as follows :

"F.I.R. No. 61Thana Ropar District Ropar Date of occurrence :

29.4.83. Sir, One written letter from District Magistrate, Ropar, addressed to S.P. Ropar for registration of case "under sections 415 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978, was received which reads as under : ''From the District Magistrate, Ropar, to Sardar M S Bhullar, I.P.S. Superintendent of Police, Ropar Nagar. Memo No. 3543 M A. at Roop Nagar, the 29th April, 1983. Sub : Regarding money circulation schemes. It has come to notice of this office that three money circulation schemes, namely (1) Lok Bhalai Sewa Scheme, Public Bhalai Scheme, and Janta Sewa Scheme are being run in the Ropar City in contravention to the provisions of Prize Chits and Money Circulation Schemes (Banning) of 1978. All the abovenoted three schemes fall within the ambit of section 2, clause (c) (i) of the said Act. From time to time, the Punjab Government in the Home Department had been instructing this office to keep maximum check for such schemes Therefore, it is desired and directed that cases be got registered against the members and Printing Press who have been printing publicity handbills for the promotion of these three schemes It may be brought to your notice that offence committed under the said Act are cognizable offences vide section 10 of the said Act. Keeping in view the urgency of the matter immediate action may he taken in this regard and report be sent to this office.

Sd/ M.S. Kailay,

District Magistrate, Roopnagar."

In order to appreciate this Petition, the relevant provisions of the Act need to be noticed. The terms "prize chit" has been defined in section 2 clause (c) of the Act in the following terms :

"2(e) ''prize chit'' includes any transaction or arrangement by whatever name called under which a person collects whether as a promoter, foreman, agent or in any other capacity, monies in one lumpsum or in instalments by way of contributions or subscriptions or by sale of units, certificates or other instruments or in any other manner or as membership fees or admission fees or service charges to or in respect of any savings, mutual benefit, thrift, or any other scheme or arrangement by whatever name called, and utilises the monies so collected or any part thereof or the income accruing from investment or other use of such monies for all or any of the following purposes, namely:

(i) giving or awarding periodically or otherwise to a specified number of subscribers as determined, by lot, draw or in any other manner, prizes or gifts in cash or in kind, whether or not the recipient of'' the prize or gift is under a liability to make any further payment in respect of such scheme or arrangement;

(ii)... ... ...".

Section 3 of the Act prohibits the promotion or conduct of any prize chit or money circulation scheme or enrolment as a member to any such chit or scheme, or participation in it otherwise or receiving or remitting any money in pursuance of such chit or scheme. Section 4 provides the penalty for contravening the provisions of section 3. Section 5 provides the penalty for other offences in connection with prize chits or money circulation schemes.

In the impugned first information report, enumerated above, it has been generally alleged that three schemes of the petitioner fall within the ambit of section (2) (e) (i) of the Act,. No details are given of the working of these schemes nor any specific allegation has been made as to how the petitioner is liable to be punished under sections 4 and 5 of the Act. The learned Petitioner''s counsel states at the Bar that the trial Court has refused to frame any charge against the petitioner on the basis of this first information report. This allegation has not been denied by the learned respondent''s counsel.

It was held by the Supreme Court in State of West Bengal and others v. Swapan Kumar Guha and others, (1982) 1 Supreme Court Cases 61, that under section 157 of the Code of Criminal Procedure, Police investigation can be commenced only if the First Information Report prima facie discloses commission of a cognizable offence. Where such offence is not disclosed, the Court will be justified in interfering with the investigation and quashing the same. In the present case the impugned First Information Report doe''s not disclose commission of an offence and only a vague allegation has been made that the three schemes of the petitioner fall within the ambit of Section 2 (c) (i) of the Act. An allegation of this nature certainly cannot be considered to prima facie disclose the commission of an offence under Section 2 (c) (i) of the Act. It is observed by the Supreme Court in the aforesaid judgment that the Police do not have an unfettered discretion to commence investigation under section 157, Code of Criminal Procedure. Their right of enquiry is conditioned by the existence of reason to suspect the commission of a cognizable offence and they cannot, reasonably, have reason so to suspect unless the First Information Report, prima facie, discloses the commission of such offence. If that condition is satisfied, the investigation must go on and the Court will have no power to stop the same. On the other hand, if the First Information Report does not disclose the commission of a cognizable offence, the Court could be justified in quashing the investigation on the basis of the information. In the present case the impugned First Information Report does not allege facts disclosing that the petitioner is giving or awarding periodical or otherwise to a specified number of subscribers as determined by lot draw or in any other manner prizes or gifts in cash or in kind whether or not the recipient of the prize is under a liability to make any further payment in respect of such scheme or arrangement. Since the First information does not disclose that the essential requirements of Section 2 (e) (i) of the Act are, prima facie, satisfied, it cannot be said in the absence of allegation whatsoever in that behalf that there is reason to suspect the commission of the offence within the meaning of Section 157 of the Code of Criminal Procedure so as to justify the investigation undertaken by the authorities.

For the reasons mentioned above, it is held that the impugned First Information Report does not disclose any offence under the Act and as such no investigation can be permitted or allowed to be continued in pursuance thereof Consequently, the petition is allowed and the First Information Report is quashed.