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2018 Supreme(P&H) 4308
IN THE HIGH COURT FOR THE STATES OF PUNJAB AND HARYANA AT CHANDIGARH
Ramendra Jain, J.
William Scott Pinckney - Appellant
Versus
Union Territory Of Chandigarh - Respondent
CRM-M No. 39703 of 2018 (O&M)
Decided On : 30-10-2018
Amrinder Sharma, Senior Advocate with Rohit Khanna and Kamal Shankar, Advocates, for the Petitioner; Ashima Mor, APP, Union Territory, Chandigarh, for the Respondent
Headnote:
Prize Chits and Money Circulation Schemes - Vicarious Liability - Sections 3, 4 of PCMCS Act, 1978, Section 420 IPC - [VICARIOUS LIABILITY] - [Prize Chits and Money Circulation Schemes] - [Sections 3, 4 of PCMCS Act, 1978, Section 420 IPC] - The court discussed the vicarious liability of a director of a company under the PCMCS Act and the necessity of arraigning the company as an accused. It highlighted the requirement of specific allegations against the director and the need for arraigning the company as an accused to establish vicarious liability. The court referred to relevant judgments and legal provisions to support its decision to quash the proceedings against the petitioner.
Fact of the Case:
The petitioner, a former Director of a company, was charged under sections 3 and 4 of the PCMCS Act and section 420 IPC. The court analyzed the legality of the charges, considering the time limitation for taking cognizance and the vicarious liability of the petitioner. It found that the charges were time-barred and lacked sufficient evidence to establish the offense under section 420 IPC. The court also emphasized the necessity of arraigning the company as an accused to establish vicarious liability.
Finding of the Court:
The court found that the charges against the petitioner were time-barred and lacked sufficient evidence to establish the offense under section 420 IPC. It also concluded that vicarious liability could not be fastened upon the petitioner without arraigning the company as an accused.
Issues: 1. Legality of charges under sections 3 and 4 of the PCMCS Act and section 420 IPC against the petitioner. 2. Vicarious liability of the petitioner as a director of the company. 3. Time limitation for taking cognizance of the alleged offenses.
Ratio Decidendi: The court held that arraigning the company as an accused is imperative to establish vicarious liability. It also emphasized the need for specific allegations against the director and the time limitation for taking cognizance of the alleged offenses. The court's decision was based on the interpretation of relevant legal provisions and precedents.
Final Decision: The petition was accepted, and FIR No.280 dated 02.12.2002 and consequential proceedings were set aside for being time-barred and lacking sufficient evidence to establish the offense under section 420 IPC. The court emphasized the necessity of arraigning the company as an accused to establish vicarious liability.
JUDGMENT
Ramendra Jain, J. - Through this instant petition under section 482, Code of Criminal Procedure, 1973 the petitioner has assailed the legality and validity of the impugned order dated 13.7.2018 (Annexure P-1) of revisional court, affirming order dated 07.01.2017 (Annexure P-2) of trial court, framing charge-sheet against him and further order dated 11.1.2017 (Annexure P-3), whereby trial court ordered, clubbing of three supplementary challans for conducting joint trial in case FIR no.280 dated 02.12.2002, registered under sections 3 and 4 of the Prize Chits and Money Circulation Schemes (Banning), Act, 1978 (in short "PCMCS Act") coupled with Section 420 IPC at Police Station, Sector 26,Chandigarh.
2. Put pithily, petitioner is ex-employee and former Director/Managing Director of M/s Amway India Enterprises Private Limited (in short "Amway Company"), incorporated under the Companies Act, 1956.
3. Complainant Shri S.P. Negi, Deputy General Manager, Reserve Bank of India, Chandigarh, made a complaint to Deputy Superintendent of Police (Crime), Economic Offences, Wing, Chandigarh Police, Chandigarh, for registration of a case against petitioner, alleging that the business being carried out by M/s Amway company is violative and banned, being infringement of provision 2(c) of Section 3 of the PCMCS Act. On the basis of above referred allegations, FIR in question was registered way back in the year 2002 under sections 3 and 4 of the PCMCS Act. Subsequently, vide letter dated 01.02.2003, addressed to Chief Secretaries of all the States and Union Territories, Reserve Bank of India informed that its officials have no power to opine that the business run by M/s Amway company was not a prize chit or money circulation and that no legal proceedings may be initiated against it. On 27.11.2009 Sub Inspector Ashok Kumar, the Investigating Officer, after around seven years, filed a status report before this court in a petition filed by M/s Amway Company that on investigation, no evidence had come against it.
4. Thereafter, Sub Inspector Ashok Kumar, Investigating Officer, conscious of the fact that, by now any action against M/s Amway Company in alleged offence under PCMCS Act, has become time barred, on 1.12.2012, almost after 10 years, filed three supplementary challans against the petitioner, wherein he was, for the first time, arraigned as accused by deliberately adding offence under section 420 IPC, without assigning any cogent reason on the basis of a report dated 21.12.2011, with a view to revive the time barred action against the petitioner under PCMCS Act.
5. The trial court, vide order dated 11.1.2017 (Annexure P-3), clubbed supplementary challans for conducting joint trial. Vide order dated 07.1.2017 (Annexure P-2), charges under sections 3 and 4 of the PCMCS Act and section 420 IPC were framed against the petitioner.
6. Being aggrieved against the said order dated 07.1.2017 of the trial court, the petitioner preferred revision, which too was dismissed vide order dated 13.7.2018 (Annexure P-1) of the revisional court.
7. Learned counsel for the petitioner has assiduously argued that the learned trial court erred in taking cognizance and framing charges against the petitioner under sections 3 and 4 of the PCMCS Act, losing sight of the fact that under provisions of sections 468 and 469, Code of Criminal Procedure, 1973 maximum sentence prescribed is 3 years from the date of registration of FIR, i.e., 02.12.2002, which stood expired on 01.12.2005 and ignoring the status report filed before this court in the year 2009 that no offence is made out against the petitioner under the aforesaid sections of the PCMCS Act. It was only on expiry of limitation period of 03 years and after a lapse of more than 10 years, statements of some of the selected witnesses, for the first time, were recorded under section 161, Code of Criminal Procedure, 1973 to add offence under section 420 IPC.
8. The basic requirement for the commission of offence
