Surinder Kumar Batra and Others vs State of Punjab

The petitioners have filed this petition u/s 482 of the Code of Criminal Procedure for quashing the FIR No. 171 dated August 3, 1989 registered at Police Station Abohar under Sections 408/409/ 465/468/471/120B, I. P. C. which was registered on the basis of a letter issued by the Assistant Registrar, Co-operative Societies, Fazilka to Senior Superintendent of Police, Ferozepur. The letter reads as under:--

Subject: Regarding registration of FIR against the employees of the Burj Hanumangarh Co-operative Agricultural Service Society Ltd. Rs. 3,67,465.77. In the resolution of the Managing Committee of the Society, it has reported as per Audit Report of the Inspector Halca that the employees of the society by misusing their office have used Rs. 3,67,465.77 in their personal affairs and embezzled, the detail of which is in accordance with the Resolution of Managing Committee and Special Audit Report. Therefore, against these employees case be registered for about Rs. 3,67,465.77 on account of breach of trust and investigation be made.

Sd/- Assistant Registrar Co-operative Societies, Fazilka.

Copy to:

Deputy Registrar, Co-operative Societies, Ferozepur.

Inspector, Vigilance, C/o The Ludhiana Central Co-operative Bank, Ludhiana for information and necessary action.

Sd/- Assistant Registrar Co-operative Societies, Fazilka.

Notice of this petition was given to the State. Joginder Singh, Sub-Inspector, SHO Police Station, Saddar Abohar has filed para-wise reply by way of an affidavit and has stated that a Special Audit report was made by Shri Om Prakash Sub Inspector, Audit Co-operative Societies, Abohar-II; that according to the Audit report, the employees of the Society, commitee members of the society, Government employees and all the petitioners have embezzled an amount of Rs. 3,67,465.77. He further stated that all the petitioners were working in the Central Cooperative Bank Branch, Kundal; that Raj Kumar, petitioner was working as Branch Manager, Ram Chander was the Cashier and Surinder Kumar Batra was also Cashier in the Branch Kundal during the year 1985-86. He further stated that Baldev Singh son of Balwant Singh, Gurcharan Singh son of Pritam Singh, Surinder Singh son of Bikar Singh, Baljinder Singh son of Gurmail Singh and Amritpal Singh son of Baldev Singh were shown as residents of village Ghuriana but in fact these persons do not belong to village Ghuriana that Darshan Singh, President, Inder Singh, Vice President, Sukhdeep Singh, Committee member, Hari Singh, Committee member Mohinder Pal Secretary and Gurmail Singh, S.M.(F) prepared and passed Maximum Cash Credit Limits in respect of the above-said persons but the said persons did not deposit the amount of their share in the bank; that the petitioners in league and connivance with the committee members, Secretary and Salesmen of Society, Inspector and Sub-Inspector had shown the amount in the documents in the name of the above 5 fictitious persons. It has been further stated in the affidavit filed by Joginder Singh, SHO that it was the duty of the petitioners to check the shares of the persons before advancing the payment, but the petitioners failed to do so and in this way, they all embezzled the amount of Rs. 70,191.75 shown in the name of the fictitious persons; that Surinder Kumar son of Sh. Lachman Dass and Subhash Chander son of Nihal Chand were members of Burj Hanumangarh Co-operative Agri. Service Society Ltd. but their maximum cash credit limits were not sent by the Society to the Branch Manger, Central Bank, Kundal. He further stated that all the petitioners and Secretary, Mohinder Pal and Salesman, Gurmail Singh added their names in the maximum Cash Credit Limit and in this way they made false entries in the record of the bank and made the payment to Surinder Kumar and Subhash Chander of Rs. 32,425/-that the above payment is illegal as the petitioners had no authority to make the payment to Surinder Kumar and Subhash Chander that Gurdev Singh son of Prithi Singh, member of the Society deposited Rs. 4662/- with Cashier, Surinder Kumar Batra; that he entered this amount in the bank on 12-12-1985; that Mohinder Pal, Secretary was also sitting near the Cashier in the Bank Branch, Kundal; that the Sectetary, Mohinder Pal made the entry in the pass book of the member, Sh. Gurdev Singh son of Pirthi Singh and signed against the entry in pass book. He further stated that during the audit of the Society, it was found that the documents showing the account of Sh. Pirthi Singh, Account No. 120 was missing from the loan ledger; that on the other hand, there was a cutting in the Cash Book in the entry where the amount of Rs. 4662/- shown deposited in the name of Gurdev Singh and that, therefore, it is evident that the Cashier Surinder Kumar Batra intentionally removed the document from the loan ledger and also made cutting in the Cash Book maintained by him and embezzled the amount of Rs. 4662/ - and Branch Manager, Raj Kumar is also guilty for not maintaining the correct accounts of the Bank.

Learned counsel for the petitioners has submitted that a perusal of the FIR would show that the Assistant Registrar had asked the Police to register a criminal case against the employees of the Society and not against the petitioners and that, therefore, there is no complaint against the petitioners before the Investigating Officer. He has further submitted that the amount shown against Surinder Kumar Batra has already been recovered from the loanee, as is evident from the certificate issued by the President of the Society, dated August 3, 1989. Learned counsel for the petitioners has further argued that so far as the advancement of loan is concerned, the same was required to be advanced by the employees of the bank and maximum credit limit of the loanee was duly sanctioned by the Society after due verification. He has further argued that in the present case, the amount in dispute was within the maximum credit limit of the loanee and the loan was rightly advanced as per rules; that there is no specific allegation of forgery against the petitioners; that no allegation of any lapse on their part in performing their duties has been alleged by the Assistant Registrar, Co-operative Societies; that the amount mentioned against the name of the petitioners has already been recovered from the original loanees and in some cases, the Arbitration awards have already been passed either against the employees of the Society or against the loanees and the same are under challenge by way of appeal or revision from which it is clear that the case is of a civil nature and no criminal proceedings could be initiated against the petitioners. In support of his argument, he has relied upon a judgment of this Court in Harbhagwan Dass v. State of Punjab 1983 (2) R C R 156.

Whether a person who besides incurring civil liability had incurred criminal liability by a certain act of his, should be prosecuted when he has been proceeded against on the civil side and a decree or an award has been passed against him or any other person, is the question that arises for consideration in this petition. No impropriety whatsoever is involved either in launching prosecution against such a person for the criminal act or for continuing with such proceedings, if alredy initiated; to their logical end. The question of impropriety, if at all, may arise only in cases where civil proceedings or the proceedings of the civil nature envisaged under a given statute terminate in favour of the accused or when the criminal prosecution is initiated after inordinate delay and that too on the failure of the civil proceedings against such a person. It is only when in such very special circumstances, it appears to the Court that the continuance of the prosecution of the accused would amount to an abuse of the process of the criminal court that this court may appropritely intervene; but here too, it could not be said that the criminal courts had no jurisdiction to try an accused or that the criminal prosecution was illegal.

Mr. G. S. Nihalsinghwala, Advocate for the State of Punjab has submitted that the civil liability of an accused who misappropriates an individual''s property or the property of an institution like the Co-operative Society etc. is based upon the right of such individual or institution to be reimbursed by such person to the extent of the misappropriated amount while the criminal liability springs from the fact that the society at large is interested in seeing that the individuals constituting the society do not deviate from the right conduct and thus law envisages imposition of punishment, physical or otherwise, to deter such persons and others from doing so in future. It is for this reasons that the State which represents the society, takes upon itself the role of a prosecutor. Even when an individual upon whom the crime had been committed refrains from prosecuting the accused and even when the petitions that the accused should not be prosecuted, the State is not debarred from prosecuting the accused, rather it is in law duty-bound to initiate the criminal proceedings and punish the accused for the crime. In support of his argument, he has relied upon the decision of the Madras High Court reported in M. Vaidyanathan Vs. The Sub-Divisional Magistrate, Erode and Others, . In that case, police investigaton and criminal prosecution of officers of the Government was sought to be stopped in its track on the plea that Section 630 of the Companies Act, 1956 barred the criminal prosecution. In that case, apart from its being observed that Section 630 of the said Act imposed no bar to the initiation of proceedings in a criminal court even with reference to acts committed in relation to the affairs of a company if those acts amounted to offences like those punishable under Sections 406 and 409, IPC the learned Judge further observed that in the prosecution of a person suspected of having committed such offences it was the State representing the society as a whole that was interested, while the benefits conferred by Section 630 of the said Act were confined to the company and to its representative specified by Section 630 itself.

Mr. G. S. Nihal Singhwala, Advocate has further contended that the remedy of arbitration on the one hand and the criminal proceedings for bringing the guilty person to book on the other hand are two entirely different remedies. Their scope and purpose are different and two are not incompatible with each other. They can go on simultaneously. In support of this arguments, he has relied upon a Division Bench decision of this Court in Laxmi Narain v. The State of Haryana, Criminal Revision No. 245 of 1979 decided on 15-3-1981 and Keval Dass v. State of Haryana 1991 (1) PLR 558.

After hearing learned counsel for the parties, I hold that the remedy of arbitration on the one hand and criminal proceedings for bringing the guilty person to book on the other hand are two entirely different remedies. Their scope and purpose are different and two are not incompatible with each other. These can go on simultaneously. In view of the Division Bench decision in Laxmi Narain''s case (supra) which is binding on a single Bench, I find no merit in this petition and hold that Harbhagwan Dass v. State of Punjab (supra) is of no assistance to the petitioners in the facts and circumstances of the present case. The amount alleged to have been embezzled in this case is Rs. 3,67,465.77.

For the reasons mentioned above, no case for quashing the First Information Report is made out and the petition is accordingly dismissed.