IMPORTANT POINT
Directors can be held criminally liable for fraud if actively involved in the misconduct, despite corporate protections.

ORDER :

Both these petitions arise out of the same crime of cheating and forgery allegedly committed by the persons who conduct the dealership of BMW cars in Kochi. The allegation is that, by resorting to forgery, the accused defrauded the purchasers of car as well as the Motor Vehicles Department by making the misrepresentation about the actual year of manufacture of cars sold to the customers. It is alleged that the accused extracted huge amounts from the car purchasers by selling cars manufactured in the past years, misrepresenting its year of manufacture as of recent years.

2. On the basis of the report of the Regional Transport Officer, Kottayam, about the widespread fraud committed by the motor vehicle dealer in the above regard, the Maradu Police registered Crime No.774/2014 in respect of the offences under Sections 406, 409, 417, 420, 465 & 468 read with Section 34 of the Indian Penal Code, 1860, against the dealership by name ‘Platino Classic Motors (India) Pvt. Ltd.’ and its Managing Director and full time Director, who were arraigned as accused Nos.1 to 3. After the completion of the investigation, the Assistant Commissioner, Crime Detachment, Kochi City, had filed the final report in the said case against the three accused, and it was taken on files as C.C.No.705/2016 by the Judicial First Class Magistrate Court-VIII, Ernakulam. The petitioner in Crl.M.C.No.7677/2017 is the third accused in the said crime, which is sought to be quashed in the petition filed under Section 482 of the Code of Criminal Procedure, 1973(in short, ‘Cr.PC’).

3. Crl.M.C.No.4743/2019 is filed under Section 482 Cr.PC to quash the same crime committed upon the de facto complainant in C.C.No.3331/2018 on the files of the Judicial First Class Magistrate Court-VIII, Ernakulam, in connection with the sale of a BMW car of year of manufacture 2011, misrepresenting it as one manufactured in the year 2012. The petitioners therein are the accused Nos. 3 & 5 in the said case. The proceedings in C.C.No.3331/2018 were initiated by the learned Magistrate upon a private complaint filed by the aggrieved person through his Power of Attorney Holder. An excess amount of Rs.12,59,118/- is said to have been extracted from the de facto complainant in the said case by the accused by selling the car manufactured in the year 2011, by misleading the de facto complainant and the registration authorities that the year of manufacture of the said car was 2012. The de facto complainant in C.C.No.3331/2018 has been arraigned as CW12 in the final report filed in C.C.No.705/2016 before the Judicial First Class Magistrate Court-VIII, Ernakulam.

4. In both these petitions, the petitioners would contend that they are not liable to be prosecuted for the alleged crime relating to the sale of BMW cars of prior years under misrepresentation as that of recent ones. It is stated that the first petitioner in Crl.M.C.No.4743/2019, who is the sole petitioner in Crl.M.C.No.7677/2017, is only a Director of the company by name ‘Platino Classic Motors (India) Pvt. Ltd.’, and that she cannot be mulcted with the vicarious criminal liability for the alleged offence. The second petitioner in Crl.M.C.No.4743/2019, who is said to be the Administration Manager of the said company, also challenges the prosecution against him upon the same ground. It is further contended by the above petitioners that the allegations levelled in the complaint filed by the de facto complainant do not constitute any of the offences attributed against them. Based on the aforesaid contentions, the proceedings in C.C.No.705/2016 & 3331/2018 on the files of the Judicial First Class Magistrate Court-VIII, Ernakulam, are sought to be quashed in exercise of the powers under Section 482 Cr.PC of this Court.

5. Heard the learned counsel for the petitioners, the learned counsel for the first respondent in Crl.M.C.No.4743/2019 and the learned Public Prosecutor representing the State of Kerala.