Back
SUPREME COURT OF INDIA
Dipak Misra, Prafulla C. Pant, JJ.
Mrs. Priyanka Srivastava and Another – Appellants
Versus
State of U.P. and Others – Respondents
CRIMINAL APPEAL NO.781 OF 2012
Decided On : 19-03-2015
(2012) 10 SCC 517 – Relied upon
(b) Code of Criminal Procedure, 1973 – Section 156(3) – Magistrate passing order for registering FIR by simply narrating the allegations – No application of mind – Not permissible. (Para 17)
(c) Code of Criminal Procedure, 1973 – Section 156(3) – Magistrate directing, ‘as per the application’, to register FIR – Not applying his mind as to nature of allegations – Matter is already proceeding under SARFAESI Act – Also there is elaborate procedures under Recovery of Debts due to Banks and Financial Institutions Act, 1993 – All these required more care, caution and circumspection in passing the order – Impugned order not sustainable. (Para 25, 26)
(1976) 3 SCC 252; (2013) 10 SCC 705; (2007) 12 SCC 496; (2005) 7 SCC 467; Crl. Appeal No. 600 of 2007; (2014) 2 SCC 1 – Relied upon
(d) Code of Criminal Procedure, 1973 – Section 156(3) – Abuse of the provision – Need to control – Directions given – Application u/s 156(3) should be filed after availing recourse to section 154(1) and 154(3) – Application u/s 156(3) must be supported by an affidavit giving details of availing provisions of section 154(1) and 154(3) – Magistrate should also verify veracity of the affidavit filed with application u/s 156(3). (Para 27)
(2014) 2 SCC 1 – Relied upon
(e) Code of Criminal Procedure, 1973 – Section 156(3) – Magistrate ought to have kept in mind the provision of section 32 of the SARFAESI Act protecting actions taken in good faith. (Para 29)
Facts of the case:
Respondent No.3, Prakash Kumar Bajaj, had availed a housing loan from Punjab National Bank Housing Finance Limited (PNBHFL) on 21st January, 2001. The loan was taken in the name of the respondent No.3 and his wife, Jyotsana Bajaj.
Due to default in consecutive payment of the installments, the loan account was treated as a Non-Performing Asset (NPA). Notice was issued to the borrowers under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, (for short, 'the SARFAESI Act') and in pursuance of the proceedings undertaken in the said Act, the PNBHFL, on 5th June, 2007, submitted an application before the District Magistrate, Varanasi, U.P. for taking appropriate action under Section 13(4) of the SARFAESI Act.
The respondent No.3 preferred W.P. No.44482 of 2007, which was dismissed by the High Court. Thereafter respondent No.3 filed a Criminal Complaint Case under Section 200 Cr.P.C. against V.N. Sahay, Sandesh Tiwari and V.K. Khanna, the then Vice-President, Assistant President and the Managing Director respectively for offences punishable under Sections 163, 193 and 506 of the Indian Penal Code (IPC). The learned Magistrate dismissed the criminal complaint and declined to take cognizance.
Respondent No.3 preferred a Revision Petition which was allowed and the matter was remanded to the trial Court with the direction that he shall hear the complaint again and pass a cognizance order according to law on the basis of merits according to the directions given in the said order.
After the remand, the learned Magistrate took cognizance and issued summons to V.N. Sahay, Sandesh Tripathi and V.K. Khanna. The said accused persons knocked at the doors of the High Court under Section 482 Cr.P.C. and the High Court quashed the complaint case.
Thereafter the respondent no. 3 filed two complaints u/s 156(3) and another complaint case against the bank officials and thus forced them to accept one-time-settlement on the condition that he will withdraw all cases, which he did not. Even after that he pursued the complaint cases and managed to get cognizance taken and summons issued against them.
Finding of the Court:
The order passed by the High Court set aside and the registration of the FIR quashed.
Result: Appeal allowed.
Certainly. Based on the provided legal document, here are the key points to consider:
When a case arising from a complaint petition reaches a higher court and an adverse order is issued, the higher court must provide an opportunity for the parties to be heard before passing the order (!) .
An order under section 156(3) of the CrPC must be based on the magistrate’s application of his or her mind, and cannot be issued by simply narrating allegations without proper scrutiny (!) .
While exercising powers under section 156(3), the magistrate should exercise caution, especially when proceedings are already underway under statutes like SARFAESI or the Recovery of Debts Act, to prevent misuse and ensure procedural propriety (!) (!) .
Applications under section 156(3) should be supported by an affidavit detailing the provisions of sections 154(1) and 154(3) of the CrPC, and the magistrate should verify the veracity of such affidavits to prevent abuse of process (!) (!) .
The magistrate must consider the protections provided under section 32 of the SARFAESI Act, which safeguards actions taken in good faith, before directing the registration of an FIR under section 156(3) (!) .
The registration of an FIR under section 154 of the CrPC is mandatory when information discloses a cognizable offence; the police officer is bound to record the information and proceed accordingly (!) (!) .
The scope of section 156(3) allows a magistrate to direct investigation without taking cognizance of an offence, but such directions must be issued after proper application of mind, and not routinely or without due scrutiny (!) (!) .
The magistrate exercising powers under section 156(3) should ensure that the application is supported by a sworn affidavit, and verify the truthfulness of allegations to avoid unwarranted investigations and harassment (!) (!) (!) .
The process of invoking section 156(3) must be undertaken with caution, especially when proceedings are already pending under other statutory remedies, to prevent misuse for harassment or undue pressure (!) (!) .
The courts emphasize that applications under section 156(3) should not be filed as a routine, and that prior compliance with sections 154(1) and 154(3) is necessary. The magistrate must exercise vigilance and ensure due diligence before issuing directions for investigation (!) (!) .
The legal provisions protect actions taken in good faith, and the magistrate must keep this in mind before directing registration of an FIR, to prevent unwarranted criminal proceedings against authorized officers or creditors (!) (!) .
Overall, the courts advocate for a cautious, well-reasoned approach in exercising powers under section 156(3), emphasizing the importance of application of judicial mind, verification of facts, and safeguarding statutory protections against abuse of process (!) (!) (!) (!) (!) .
Please let me know if you need further elaboration or assistance on specific aspects.
JUDGMENT
Dipak Misra, J.
The present appeal projects and frescoes a scenario which is not only disturbing but also has the potentiality to create a stir compelling one to ponder in a perturbed state how some unscrupulous, unprincipled and deviant litigants can ingeniously and innovatively design in a nonchalant manner to knock at the doors of the Court, as if, it is a laboratory where multifarious experiments can take place and such skillful persons can adroitly abuse the process of the Court at their own will and desire by painting a canvas of agony by assiduous assertions made in the application though the real intention is to harass the statutory authorities, without any remote remorse, with the inventive design primarily to create a mental pressure on the said officials as individuals, for they would not like to be dragged to a court of law to face in criminal cases, and further pressurize in such a fashion so that financial institution which they represent would ultimately be constrained to accept the request for “one-time settlement” with the fond hope that the obstinate defaulters who had borrowed money from it would withdraw the cases instituted against them. The facts, as we proceed to adumbrate, would graphically reveal how such persons, pretentiously aggrieved but potentially dangerous, adopt the self-convincing mastery methods to achieve so. That is the sad and unfortunate factual score forming the fulcrum of the case at hand, and, we painfully recount.
2. The facts which need to be stated are that the respondent No.3, namely, Prakash Kumar Bajaj, son of Pradeep Kumar Bajaj, had availed a housing loan from the financial institution, namely, Punjab National Bank Housing Finance Limited (PNBHFL) on 21st January, 2001, vide housing loan account No.IHL-583. The loan was taken in the name of the respondent No.3 and his wife, namely, Jyotsana Bajaj. As there was default in consecutive payment of the installments, the loan account was treated as a Non-Performing Asset (NPA) in accordance with the guidelines framed by the Reserve Bank of India. The authorities of the financial institution issued notice to the borrowers under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, (for short, 'the SARFAESI Act') and in pursuance of the proceedings undertaken in the said Act, the PNBHFL, on 5th June, 2007, submitted an application before the District Magistrate, Varanasi, U.P. for taking appropriate action under Section 13(4) of the SARFAESI Act.
3. At this juncture, the respondent No.3 preferred W.P. No.44482 of 2007, which was dismissed by the High Court on 14th September, 2007, with the observation that it was open to the petitioner therein to file requisite objection and, thereafter, to take appropriate action as envisaged under Section 17 of the SARFAESI Act. After the dismissal of the writ petition with the aforesaid observation, the respondent No.3, possibly nurturing the idea of self-centric Solomon’s wisdom, filed a Criminal Complaint Case No.1058 of 2008, under Section 200 Cr.P.C. against V.N. Sahay, Sandesh Tiwari and V.K. Khanna, the then Vice-President, Assistant President and the Managing Director respectively for offences punishable under Sections 163, 193 and 506 of the Indian Penal Code (IPC). It was alleged in the application that the said accused persons had intentionally taken steps to cause injury to him. The learned Magistrate vide order dated 4th October, 2008, dismissed the criminal complaint and declined to take cognizance after recording the statement of the complainant under Section 200 Cr.P.C. and examining the witnesses under Section 202 Cr.P.C.
4. Being grieved by the aforesaid order, the respondent No.3 preferred a Revision Petition No.460 of 2008, which was eventually heard by the learned Additional Sessions Judge, Varanasi, U.P. The learned Additional Sessions Judge after adumbrating the facts and taking note of the submission
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
