R. Saroja, Ingritta and S. Sekar vs The State

Mr. Justice P.R. Shivakumar

Heard both sides and perused the records sent for from the Trial Court and also the copies of documents produced in the form of typed-set of papers. The petitioners 1 to 3 in the Criminal Revision Case figured as accused No. 5, 6 and 8 respectively in C.C. No. 100 of 2008, pending on the file of the learned Special Judge, Special Court under the Tamil Nadu Protection of Interests of Depositors(in Financial Establishments) Act, 1997(hereinafter called as the "TNPID Act"), Madurai. The said case was registered as Crime No. 9 of 2005, for an offence punishable u/s 420 IPC, on the file of the Central Crime Branch, Thoothukudi District and the Inspector of Police of the said Branch, after completion of investigation, submitted a final report. However, the Investigating Officer, namely, Inspector of Police, Central Crime Branch, Thoothukudi District, on completion of investigation, chose to file the final report alleging commission of offence u/s 5 of TNPID Act, 1997 alone against 11 persons.

The first accused is the partnership firm and other accused are said to be the partners in the said firm. The petitioners herein who have been arrayed as accused No. 5,6 and 8 respectively, filed Cr.M.P. No. 864 of 2009 u/s 239 of Cr.P.C., praying for an order of discharge contending that long before the lodging of the complaint, the petitioners had retired from the partnership firm which was carrying on the business as financial establishment and that hence, they could not be termed as persons responsible for the management of the affairs of the financial establishment.

The learned Special Judge, after hearing both sides and upon perusing the records, came to the conclusion that the said petition deserved to be dismissed and accordingly dismissed the petition by the impugned order. The learned Special Judge made elaborate discussion as to how the petitioners herein, who had retired from the partnership firm long before the lodging of the complaint, would be liable to the depositors for repayment of the loan covered by the receipts with interest. The learned Special Judge also adverted to the fact that there were materials collected by the Investigating Agency to show that even in respect of the deposits collected during their presence in the firm as partners, default had been committed and hence they were liable to be prosecuted for an offence u/s 5 of the TNPID Act. The entire discussion made by the learned Special Judge proceeded on the basis that the court had to consider whether there were grounds for presuming that the petitioner had committed the offence alleged in the final report and failed to consider whether the materials available were enough to make out a ground for presuming that the petitioners had committed "an offence".

Section 239 of Code of Criminal Procedure says that:

If upon considering the police report and the documents sent with if u/s 173 and making such examination, if any, of the accused as the Magistrate thinks necessary and after giving the prosecution and the accused an opportunity of being heard, the Magistrate considers the charge against the accused to be groundless, he shall discharge the accused, and record his reasons for so doing.

Section 239 refers to the opinion of the Magistrate that the charge against the accused to be groundless, as the ground for discharge. It shall not be proper to read Section 239 Cr.P.C. in isolation. Section 239 should be read in conjunction with the succeeding section, namely Section 240 of Cr.P.C., which says:

If upon such consideration, examination, if any, and hearing, the Magistrate is of opinion that there is ground for presuming that the accused has committed an offence triable under this Chapter(Chapter XIX) which such Magistrate is competent to try and which, in his opinion could be adequately punished by him, he shall frame in writing a charge against the accused.

A conjoint reading of Section 239 and 240 of Cr.P.C. will show that the Investigating Officer might have committed a mistake in referring to the penal provisions, but consideration of the report and the documents and after hearing, if the Magistrate comes to the conclusion that there is ground for presuming that the accused has committed any other offence triable by him, then there would not be any question of discharging the accused and the Magistrate is bound to frame a charge for such an offence. In this case, the learned Special Judge, who is deemed to be a Magistrate as per Section 13 of TNPID Act, has failed to consider whether there are materials making out a ground for presuming that the petitioners herein (A5, A6 and A8) have committed any other offence punishable under IPC, especially an offence u/s 420 I.P.C.

At this juncture, it shall be appropriate to point out the power of the Special Court under TNPID Act to try any other offence also. Section 6(4) refers to such power which reads as follows:

6(4) When trying any case, the Special Court may also try any offence, other than an offence specified in Section 5, with which the accused, any under the Code of Criminal Procedure, 1973(Central Act 2 of 1974), be charged, at the same trial.

In case, there was a conspiracy to commit an offence and such an offence is committed pursuant to the conspiracy, then all the persons who were parties to the conspiracy shall be liable to be prosecuted for the said offence as if the offence was committed by him also. Offence u/s 5 of the TNPID Act can also be projected against others in case, there was such conspiracy pursuant to which the offence came to be committed. Similarly, if there are materials sufficient to show the existence of a prima facie case that an offence of cheating punishable u/s 420 IPC has been committed by the erstwhile partners in collusion with the existing partners, they cannot be entirely discharged and the court has to consider whether there is any ground for presuming the commission of such an offence by such petitioners also. Unfortunately, the learned Special Judge failed to consider the above aspects.

Hence, this Court comes to the conclusion that it shall be in the interest of justice to set aside that part of the common order passed by the learned Special Judge, Special Court, TNPID Act, Madurai, dated 6.4.2011 so far as it relates to Cr.M.P. No. 864 of 2009 in C.C. No. 100 of 2008 filed by the petitioners and remit back the Cr.M.P back to the trial Court to consider the petition afresh and pass orders in the light of the observations made by this Court. In the result, the order of the Special Judge, Special Court, TNPID Act, 1997, Madurai dismissing Crl.M.P. No. 864 of 2009 in C.C. No. 100 of 2008, on the file of the said Special Court is set aside and Cr.M.P. No. 864 of 2008 is remitted back to the Trial Court with a direction to consider the petition afresh in the light of the observations made by the Court in this order. Consequently, connected Miscellaneous Petition is closed.