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IN THE HIGH COURT OF ALLAHABAD
Subhash Vidyarthi J.
Sandeep Miglani - Applicant
Vs.
Union Of India Thru. Deputy Commissioner Of Income Tax Kanpur And Another - Opposite Party
Application U/S 482 No. - 5145 of 2024
Decided On : 04-06-2024
BENAMI - Prohibition of Benami Property Transactions - Sections 50, 53, 55 of the Benami Act; Sections 200, 202 of the Cr.P.C. - The court discussed the provisions of the Benami Act, particularly Sections 50, 53, and 55, which outline the jurisdiction and authority of Special Courts in handling benami transactions. It emphasized the exemption for public servants under Section 200 of the Cr.P.C. regarding the need for inquiry before cognizance. The court concluded that the summoning order was valid as it was based on a complaint from a public servant, fulfilling the statutory requirements.
Fact of the Case:
The petitioner challenged the validity of a summoning order issued by the IX Additional Sessions Judge, Lucknow, in a complaint filed under the Benami Act. The complaint arose from a search and seizure operation revealing a benami transaction involving a cash deposit of Rs. 30,00,000 in a trading company's account, with Rs. 7,50,000 transferred to the petitioner's account. The petitioner argued that the court lacked jurisdiction as he resided outside its territorial limits.
Finding of the Court:
The court found that the complaint was validly filed by a public servant and that the Special Court had jurisdiction under the Benami Act. It held that the inquiry conducted was sufficient to establish grounds for proceeding against the petitioner, thus upholding the summoning order.
Issues: Whether the court had jurisdiction to summon the petitioner residing outside its territorial limits and whether the inquiry conducted before taking cognizance was adequate under the Cr.P.C.
Ratio Decidendi: The court ruled that the exemption for public servants under Section 200 of the Cr.P.C. applied, negating the need for a detailed inquiry before cognizance. It clarified that the limited inquiry under Section 202 was satisfied by the examination of the complaint and accompanying documents, affirming the validity of the summoning order.
Final Decision: The application under Section 482 Cr.P.C. was dismissed, affirming the legality of the summoning order and the jurisdiction of the Special Court.
JUDGMENT :
Subhash Vidyarthi J.
1. Heard Sri Rohit Kumar Tripathi, the learned counsel for the petitioner, Sri Neerav Chitravanshi and Sri Kushagra Dixit, the learned counsel for the opposite parties.
2. By means of the instant application filed under Section 482 Cr.P.C., the petitioner has challenged validity of an order dated 27.02.2024 passed by the IX Additional Sessions Judge, Lucknow in Complaint Case No. 277 of 2024 whereby the trial court has taken cognizance of offence under Section 53 read with Section 3 of the Prohibition of Benami Property Transaction Act, 1988 (hereinafter referred to as ‘Benami Act’) and he has been summoned to face trial.
3. The opposite party no. 1-Union of India has filed a complaint under Section 53 of Benami Act through a Deputy Commissioner of Income Tax/Initiating Officer, Benami Prohibition, Benami Unit, Kanpur, after obtaining sanction for prosecution from the Principal Director of Income Tax (Investigation) Kanpur under Section 55 of the Benami Act on 29.01.2024.
4. The complaint states that a search and seizure under Section 132 of the Income Tax Act, 1961 was conducted on 18.01.2017, which revealed that M/s Shyam Trading Company (a proprietorship concern of Ghanshyam Patel) had used its bank account maintained with J & K Bank, Ghaziabad to deposit a cash amount of Rs.30,00,000/- on 12.11.2016. Out of the aforesaid amount, Rs.7,50,000/- were transferred to the bank account of the applicant being maintained with Axis Bank, Delhi through NEFT on 12.11.2016. Ghanshyam Patel denied ownership of the amount deposited in his bank account. After inquiry, the matter was transferred to the Banami Prohibition Unit, Kanpur for initiating proceedings under Benami Act. During further inquiry held by the Benami Prohibition Unit, Kanpur, the applicant admitted on oath that the aforesaid sum of Rs. 7,50,000/- deposited into the bank account of M/s Shyam Trading Company was the applicant’s unaccounted cash, which was deposited during demonetization period and had been transferred to his bank account. Ghanshyam Patel, proprietor of M/s Ghanshyam Trading Company, also admitted in his statement that the amount of Rs. 7,50,000/- deposited in his bank account in cash was a benami transaction.
5. The Deputy Commissioner of Income Tax/ Initiating Officer, Benami Prohibition Benami Unit, Kanpur filed a complaint dated 25.02.2024 on the basis of the aforesaid facts. The learned IX Additional Session Judge, Lucknow took cognizance of the alleged offence on the same date i.e. 27.02.2024 and summoned the applicant to face the trial.
6. The learned counsel for the applicant has assailed the validity of the summoning order dated 27.02.2024 on the sole ground that the applicant resides at New Delhi, i.e. beyond the territorial jurisdiction of the Court which has passed the summoning order and, therefore, as per the statutory provision contained in Section 202 Cr.P.C., it was mandatory for the Court to have conducted an inquiry before taking cognizance of the offence and summoning the applicant.
7. In support of his contention, the learned counsel for the applicant has relied upon a decisions in Vishwakalyan Multistate Credit Coop. Society Ltd. v. Oneup Entertainment (P) Ltd., 2023 SCC OnLine SC 1749, a decision rendered by a coordinate Bench of this Court in Azim Premji v. State of U.P., 2024 SCC OnLine All 1956 and a decision rendered by an Hon’ble Single Judge of Calcutta High Court in Divyajot Singh Jendu v. Manikaran Analytics Ltd.: 2022 SCC OnLine Cal 200.
8. Per contra, Sri Neerav Chitravanshi, the learned counsel for the opposite parties has submitted that the Proviso (a) appended to Section 200 Cr.P.C. provides that the Magistrate need not examine the complaint and the witnesses, if a complaint has been made by a public servant. He has relied upon a decision of the Hon’ble Supreme Court in the case of Cheminova India Limited v. State of Punjab: 2021 SCC OnLine SC 573.
9. Before proceeding with the matter, it would be ap
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