At the charge framing stage, the court assesses if evidence presents grounds to presume an offence, not to weigh evidentiary value, reinforcing individual responsibility for corporate wrongdoing.

ORDER

The challenge in this Crl.Revision Petition is to the order dated 06.12.2023 in CMP No.4533/2023 in C.C No.63/2022 passed by the Chief Judicial Magistrate Court, Kasaragod. The petitioner, who is accused No.5, faces charges under Sections 406 and 420 read with Section 34 of the IPC .

2. The prosecution allegation as narrated in Anx.A3 order dated 06.12.2023 in CMP No.4533/2023 in C.C No.63/2022 reads thus:

“9. The allegations, as per the final report, is that Chandragiri Chits Private Limited, is a company registered under the Companies Act, 1956. Accused Nos. 1, 2, 4 and 5 being Directors and 3^rd accused being Manager of said company, conducted chits without necessary authorization from Government. They canvassed subscribers by making them to believe that said business is having necessary sanction from the Government. Believing the words, the defacto complainant deposited a sum of Rs.8,50,000/- and witness Nos.4, 5, 8, 11 and 13 had deposited a sum of Rs.6,68,000/-. Further, accused received a sum of Rs.57,18,000/-from witnesses No.4, 5, 7 and 8 as deposit by promising interest. On maturity of chit amount and the deposit, accused issued cheques of 'Apstineo Trader Pvt. Limited' a company owned by said Chandragiri Chit Pvt. Ltd and accused Nos.1, 2, 4 and 5, drawn on Axix bank and Uco bank, Kasaragod branch knowing that there is no balance in those accounts to honour the cheque. Thus, by making the subscriber to believe that accused have valid permit to conduct chit, canvassed a deposit of about 5 crores rupees from about 400 depositors and they absconded by not repaying the amount to the subscribers and thereby committed offence punishable u/s 406, 420 r/w 34 of IPC .”

3. The petitioner filed CMP No.4533/2023 seeking discharge under Section 239 Cr.PC. The learned Chief Judicial Magistrate dismissed the application holding that the materials placed by the prosecution primarily disclosed the offences alleged.

4. I have heard the learned counsel for the petitioner, the learned counsel for respondent No.3 and the learned Public Prosecutor.

5. The learned counsel for the petitioner challenged the order dismissing the discharge application on the following grounds:

1. The materials placed before the Court do not reveal the offences alleged.

2. The company, in which the petitioner is one of the directors, is not arrayed as an accused, and therefore, the prosecution against the director on the principle of vicarious liability would not stand.

6. The learned Public Prosecutor submitted that there is evidence to show that the petitioner was part of a conspiracy and he has been made an accused in his individual capacity. The learned Public Prosecutor submitted that the petitioner has been arraigned as an accused not on the principle of vicarious liability.

7. Sections 239 and 240 of the Code of Criminal Procedure deal with discharge and framing of charge.

8. The obligation to discharge the accused under Section 239 Cr.P.C. arises when “the Magistrate considers the charge against the accused to be groundless.”

9. The primary consideration at the stage of framing charge is the test of the existence of a prima facie case. The probative value of the materials on record is not to be gone into at this stage.

10. The Apex Court in Onkar Nath Mishra and others v. State (NCT of Delhi) and another [(2008) 2 SCC 561] while considering the nature of evaluation to be made by the Court at the stage of framing of charge held thus:-

“11. It is trite that at the stage of framing of charge the court is required to evaluate the material and documents on record with a view to finding out if the facts emerging therefrom, taken at their face value, disclosed the existence of all the ingredients