IMPORTANT POINT
Issue of summons in complaint case.

Headnote:Code of Criminal Procedure, 1973 - Section 204 r/w section 482 - Complaint not making any specific allegation against respondent nos. 2 to 7 - Magistrate not recording his satisfaction about prima facie case against respondent nos. 2 to 7 and the role played by them - Issue of summons is abuse of the process of court - High Court rightly quashed process against respondent nos. 2 to 7. (Para 21)
        AIR 1988 SC 709; AIR 1992 SC 1815; (2008) 5 SCC 668; 2011 (11) SCALE 128 - Relied upon
        (1988) 1 SCC 692; (2008) 5 SCC 662; 2011 (11) SCALE 128; AIR 2005 SC 2622 - Referred
       Facts of the case:
        M/s. GHCL Employees Stock Option Trust (the complainant company) opened demat account with M/s India Infoline Limited (the respondent company) and traded securities from time to time. The respondent company raised a debit of 10.48 crores which was cleared by the complainant company. However it transpired that the debit was only 10,22,77,522/-. Thus the respondent company was alleged to have dishonestly received a sum of 25,22,477.53. Thereafter instead of refunding the excess amount so received and transferring the stocks purchased on behalf the complainant company the respondent company sold its 8,76,668 shares and appropriated the proceeds thereof also on some pretext.
        The complainant company filed a complaint under Sections 415, 409, 34, and 120B of the Indian Penal Code.
        The Metropolitan Magistrate directed issuance of summons to the respondents to face trial.
        The High Court quashed the process against all respondents except the respondent company (respondent no. 1)
       Finding of the Court:
        High Court rightly quashed process against respondent nos. 2 to 7.
       Result : Appeals dismissed.

JUDGMENT

M.Y. EQBAL, J.

Leave granted.

2. Since these seven appeals arose out of the common order passed by the Delhi High Court in seven Criminal Miscellaneous Cases filed by the respondents, the same have been heard and disposed of by this common judgment.

3. The aforesaid seven Criminal Miscellaneous Cases were filed in the High Court challenging the order dated 27th September, 2008 passed by the Metropolitan Magistrate, New Delhi whereby he had summoned the respondents to face trial under Sections 415, 409, 34, 120B of the Indian Penal Code (IPC) on a complaint filed by the appellant. These Criminal Miscellaneous Cases were filed separately in the High Court on behalf of the Company, namely, India Infoline Limited, and by the Managing Director, Company Secretary and other Directors of the said Company.

4. The appellant had filed a complaint before the Metropolitan Magistrate alleging commission of offences under the aforementioned Sections of IPC. The brief facts of the case as set out in the complaint are as follows: The complainant opened a Demat Account with respondent No. 1 Company, namely, India Infoline Limited in 2007 and placed orders from time to time for purchase of shares and also made payments against its running account with the Company. The Company allegedly claimed outstanding debit of Rs.10.48 crores against the complainant in its Demat Account with it. The said Company was having a lien on 20,46,195 shares purchased by the complainant in that account. The respondent-Company being accused No. 1 informed the complainant about the aforesaid debit. The complainant cleared the amount outstanding against it by making payment of Rs.10.48 crores by a cheque. Later on, it transpired that the correct debit against the complainant was Rs.10,22,77,522/-. It was alleged that the respondent-Company dishonestly received a sum of Rs.25,22,477.53 from the complainant by making false demand. It was further alleged by the complainant that on receipt of the amount of Rs.10.48 crores the respondent- accused were under legal obligation to transfer the shares purchased by the complainant from the Pool Account to its Demat Account but instead of doing that and refunding the excess amount of Rs.25,22,477.53, they, vide letter dated 14th May, 2008 asked the complainant to clear the debit of 5 companies, namely, (i) Carissa Investments Pvt. Ltd. (ii) Altar Investments Pvt. Ltd. (iii) Oval Investments Pvt. Ltd. (iv) Dalmia Housing Finance Ltd. (v) Dear Investment Pvt. Ltd. in terms of its letter dated 1st March, 2008 failing which they would regularize the aforementioned 5 accounts by selling the stock of the complainant. The complainant alleged that since no letter dated 1st March, 2008 had been written by the complainant to the accused, it denied the averments made in their letter dated 14th May, 2008. The complainant further alleged that they met respondents Nos. 2 to 7, namely, the Managing Director, the Company Secretary and the Directors of respondent No. 1 Company and requested to refund the excess amount and transfer its shares to Demat Account but nothing was done. The complainant, therefore, alleged that the respondents have committed criminal breach of trust and cheating, inasmuch as they have sold off 8,76,668 shares of the complainant on 23rd June, 2008 and misappropriated the entire sale proceeds.

5. The Metropolitan Magistrate after considering the allegations made in the complaint, documents placed on the record and the evidence led by the witnesses, and after being satisfied that a prima facie case is made out, directed issuance of summons against the respondents to face trial under the aforementioned Sections of IPC.

6. Aggrieved by the said order passed by the Metropolitan Magistrate, New Delhi, the respondents filed separate petitions before the Delhi High Court challenging the issuance of summons against the Company, the Managing Director, the Company Secretary and the Directors of the Company. The High Court by the

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2013 Supreme(SC) 279

IMPORTANT POINT Issue of summons in complaint case.

Cases Referred (8)

IMPORTANT POINT
Issue of summons in complaint case.