High Court of Calcutta
M.G. Mukherji, Ruma Pal, JJ.
Regional Provident Fund Commissioner West Bengal – Appellant
Versus
Raj Kumar Nemani – Respondent
Appeal from Original Order No. 414 of 1993
Decided On : Nov 29, 1994
EMPLOYEES PROVIDENT FUNDS AND MISCELLANEOUS PROVIDENT FUNDS ACT, 1952 - Prosecution - Sanction - Whether prior sanction of the Court is necessary for prosecuting the Chairman of the Committee of Management of a company appointed by the Court - Held, no prior sanction is necessary.
Fact of the Case:
The writ petitioner, the Chairman/member of the Committee of Management of Baranagore Jute Factory, was arrested for non-payment of employees' share of Provident Fund contributions for the month of January 1993. He moved a writ petition challenging the arrest and the criminal proceeding initiated against him, contending that prior leave of the Court was necessary for prosecuting him as he was an officer of the Court. The learned Single Judge released the petitioner on bail subject to certain conditions.
Finding of the Court:
The Court held that no prior sanction or leave is necessary either within the meaning of Section 197 Cr. P. C. or in respect of Section 446 of the Companies Act at the present stage for lodging the F. I. R. or initiating a criminal investigation. At the time of taking cognizance by the Criminal Court after the submission of a charge-sheet or final report, the appropriate Magistrate will consider this aspect of the matter whether a leave or sanction would at all be necessary.
Issues: 1. Whether prior sanction of the Court is necessary for prosecuting the Chairman of the Committee of Management of a company appointed by the Court? 2. Whether the arrest of the petitioner was justified?
Ratio Decidendi: 1. The Court held that the Chairman of the Committee of Management of a company appointed by the Court is not an officer of the Court and, therefore, no prior sanction of the Court is necessary for prosecuting him. 2. The Court held that the arrest of the petitioner was justified as there was a prima facie case against him.
Final Decision: The Court allowed the appeal and set aside the order of the learned Single Judge. The Court directed the petitioner to surrender before the appropriate Court within a fortnight and the appropriate Magistrate to release him on bail on such appropriate and proper terms as may be deemed just and proper.
1. THE present appeal is directed against an order dated 14th May, 1993 passed by a learned single Judge of this Court directing the release of the writ petitioner, Raj Kumar Nemani, the Chairman/member of the Committee of Management of baranagore Jute Factory on bail subject to the condition that he would report to the officer-in-charge. Alipore police station over telephone twice a week but he would not leave Calcutta without the express permission of the Court except for the purpose of going to Baranagore Jute Factory to perform his duties. By the same order the learned single Judge directed the superintendent of Dum Dum Central jail to release the said petitioner forthwith. It was further directed by the self-same order that the writ petitioner who was in a nursing home for treatment would be released and would be set free as and when he would be certified by the doctor.
2. ON an appeal being moved against the self-same order by the present appellant. The Regional Provident Fund Commissioner, West Bengal, a division Bench of this Court stayed the operation of the order dated 14th may, 1993 except that the respondent writ petitioner. Raj Kumar Nemani would not be arrested on the same charges by the police till the disposal of the appeal. The Division Bench recorded order itself that the writ petitioner respondent was released from the jail custody on 15th May, 1993 pursuant to the order dated 14. 5. 93 passed by the Trial Court. The appeal Court made it clear that this order would not prevent the trial Court to hear out and dispose of the main writ application. By a subsequent order dated 22. 6. 93 the Division Bench further expressed its desire that the main writ petition should be heard out by the Trial Court. We are, however, given to understand that the Trial Court has since not heard out the matter and the present appeal is placed for hearing mainly on the question of the propriety of the order passed by the Trial Count. It has been contended before us by the appellant that Baranagore Jute factory having its registered office at 284, Maharaja Nanda Kumar road, is an establishment governed by the Employees Provident Funds and miscellaneous Provident Fund Act, 1952 hereinafter referred to for the sake of brevity as the Act. It was granted exemption in terms of Section 17 of the act. The establishment was required to deposit the Provident Funds and other allied dues strictly within 15 days from the close of every month. The dues for the month of January 1993 were required to be paid by the establishment to the Board of Trustees of its Provident Fund by February 15, 1993. The employees' share of Provident Fund contributions amounting to Rs.5,59,387/- for the said month of January, 1993 had been duly deducted by the employer from the wages of the employees of the establishment. Despite such deduction the said employees' share of Provident fund contributing was not paid into the company's Provident Fund account. The employer's share of Provident Fund contributions for the said month was also not paid. Till about the month of April, 1993 the establishment has defaulted in the payment of Provident Fund dues to the tune of Rs. 558. 33 lakhs and out of the said outstanding dues, the sum of rs. 144. 44 lakhs fell into arrears during the period of the writ petitioner's tenure as Chairman of the establishment. In the circumstances, for nonpayment of the employees share of Provident Fund contributions for the month of January 1993, the Regional Provident Fund Commissioner, West Bengal, lodged a First Information Report dated April 13, 1993 with the inspector General of police, Enforcement Branch, West Bengal. It was given out in the said First Information. Report that by not paying the employees' share of Provident Fund dues for the said month of January, 1993 even alter deducting the same from the wages of the employees, the employer of the establishment had committed an offence punishable under Section 406/409 of the India
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