ORDER

The challenge is against the registration of FIR under Sections 3,4,5 and 6 of Prize Chits and Money Circulation Schemes (Banning) Act, 1978 and the submission of a final report.

2. The allegation is that the accused who was engaged in the manufacture of some ayurvedic medicine and its sale under the guise of promoting his business adopted a money circulation scheme enrolling around 12000 persons offering and giving commission at the various level of the chain and linkage in order to obtain quick and easy money. It was challenged on the ground that there is no Money Circulation Scheme and only some of their employees were deputed for business canvass. Inter alia , it was contended that mere offering of commission to some other person in promoting the business cannot be termed as a Money Circulation Scheme.

3. A three Judge Bench of the Apex Court in State of West Bengal and Others v. Swapan Kumar Guha and Others (1982 KHC 419 : AIR 1982 SC 949) had the occasion to consider what actually amounts to a Money Circulation Scheme comprehended within the statutory meaning of Section 2(c) of the Act and laid down that it must be proved that he is promoting or conducting a scheme for the making of quick or easy money and secondly the chance or opportunity of making quick or easy money must be shown to depend upon an event or contingency relative or applicable to the enrollment of members into that scheme.

4. The allegation is that around 12000 persons were enrolled by offering commission at the various level of linkage by making a chain/linkage, by which huge amounts were collected rather than selling the items or promoting their business by adopting a Money Circulation Scheme. Amounts were given at the various level of linkage starting from the top to the last person. Prima facie, it appears that it will attract the offence alleged since the allegation is against the conduct of a money chain business by collecting quick and easy money depending upon the enrollment of members into a money chain scheme, for which, two or three items of ayurvedic medicines were distributed under that guise. The allegation of enrollment of 12000 persons would prima facie show its seriousness and the nature of enrollment for making easy and quick money in large scale under the guise of sale of two or three items of ayurvedic medicine. Then it is a matter of evidence. Hence, it is not fit and proper to exercise the power under Section 482 Cr.P.C. But the Trial Court shall expedite the disposal of the case within a period of six months from the date of receipt of a copy of this order and shall report compliance.

The Crl.M.C. is dismissed accordingly.

Sd/- P.SOMARAJAN JUDGE

msp

APPENDIX PETITIONER'S/S ANNEXURES: ANNEXURE I A TRUE COPY OF CERTIFICATE OF INCORPORATION OF THE PETITIONER COMPANY.

ANNEXURE II A TRUE COPY OF THE APPROVAL ACCORDED BY THE DEPARTMENT OF INDUSTRIAL POLICY AND PROMOTION, MINISTRY OF COMMERCE AND INDUSTRY, DATED 19.07.2002.

ANNEXURE III COPIES OF TAX INVOICES SHOWING THE MODALITIES ADOPTED BY THE PETITIONER.

ANNEXURE IV A TRUE COPY OF LETTER DATED 15.02.2005 ISSUED BY THE UNDER SECRETARY TO GOVT. OF INDIA TO CLARIFY THE PETITIONER HAS PERMISSION TO IMPORT HEALTH CARE PRODUCTS.

ANNEXURE V COPIES OF VARIOUS BILLS OF ENTRIES EVIDENCING SAMPLE OF GOODS IMPORTED BY THE PETITIONER COMPANY.

ANNEXURE VI A COPY OF THE LICENSE ISSUED BY THE OFFICE OF THE ASST.DIRECTOR OF DRUGS CONTROL ZONE - II TO SELL, STOCK OR EXHIBIT (OR OFFER) FOR SALE, OR DISTRIBUTE BY WHOLESALE, DRUGS, OTHER THAN THOSE SPECIFIED IN SCHEDULE C, C(1) AND X. ANNEXURE VII A COPY OF ORIGINAL PACKING OF ONE OF THE PRODUCTS OF PETITIONER-COMPANY.

ANNEXURE VIII A COPY OF SCHEDULE SHOWING THE TAXES PAID BY THE PETITIONER COMPANY FOR THE PAST 12 YEARS INCLUDING SALES TAX, CUSTOMS DUTY AND INCOME TAX.

ANNEXUR