State of West Bengal Vs. Narayan K. Patodia
[2000] INSC 201 (6 April 2000)
K.T. THOMAS & D.P. Mohapatra
of 1999 Thomas J.
LT.J Leave granted.
The High Court of Calcutta has quashed the
FIR registered in a Police Station mainly on the ground that the person who
forwarded the complaint to the police had no authority to do so. The State of
West Bengal has, therefore, filed this Appeal by Special Leave. The FIR was
registered for certain offences under the Indian penal Code and West Bengal
Sales Tax Act 1994 (for short the `Sales Tax Act'). The complaint which was
made the basis for such an FIR contained the allegations that respondent
submitted two applications on 21.1.1998 before the Assistant Commissioner of
Commercial Taxes, Burdwan impersonating himself as one Mohan Agrawal (478 Katwa
Road, Hari Narainpur, Burdwan) who is a fictitious person; respondent signed
the applications in the false name of the said Agrawal and described him as a
businessman dealing in spices under the trade name "Parbati Traders."
The applications were made in the Proforma (Form-A) prescribed under the West
Bengal Sales Tax (Registration and Turnover) Rules 1957, and they were appended
with documents all of which were forged. On the basis of the said fabricated
documents respondent obtained registration under the Sales Tax Act which
entitled him to make purchases at concessional rate of sales tax, and also to
receive permits for importing spices from outside the State. On the strength of
the registration so obtained the respondent applied for the issue of five
permits to import spices the sales tax of which would have been 2.73 lacs. In
those applications again the respondent personated himself to be the aforesaid
fictitious Mohan Agrawal.
When the Bureau of Investigation formed by
the Government of West Bengal under the Sales Tax Act, got secret information
about the fraud played by the respondent they conducted some discreet
investigation and then it was revealed to them that the respondent had
committed the said forgery and impersonation to defraud the government of huge
sales tax amount. It was further revealed that respondent had wangled another
registration on 1.12.1977 in the fictitious name of Surendra Luhariwala who
purportedly did business as "Luhariwala Trading Company 33/1, N.S. Road
Calcutta." By using the said registration respondent carried on business
and defrauded the Government of sales tax to the tune of Rupees thirty-two
lakhs.
The said complaint was presented by the
Assistant Commissioner of Commercial Taxes to the Deputy Superintendent of
Police who was then attached to the Bureau of Investigation formed under the
Sales Tax Act. The said Deputy Superintendent, in turn, forwarded the complaint
to the officer in charge of Hare Street Police Station, Calcutta with a request
to "start a case under Sections 403, 409, 465, 468, 471, 419, 420 read
with 120B of Indian Penal Code and Section 88(1)(b)(6) and (7) of the Sales Tax
Act, 1994 treating the complaint as FIR." Pursuant thereto the Station
House Officer of Hare Street Police Station registered the FIR. Respondent,
getting scent of the same moved the City Civil Court, Calcutta for anticipatory
bail but that was rejected on 11.6.1998. He then moved the High Court invoking
its revisional and inherent jurisdiction for quashing the FIR and on such
motion being made further investigation was stayed by the High Court as per
order dated 17.6.1998. Finally the FIR was quashed as per the impugned judgment
delivered by learned single judge of the Calcutta High Court on 19.11.1998.
Learned single judge advanced the following
reasoning, inter alia, for quashing the FIR:
"Under Section 7 of the West Bengal
Sales Tax Act, the Bureau of Investigation constituted under the said Act is the
only competent authority to investigate in respect of any offence under the
said Act which means no other authority can carry out investigation or hold
inquiry into any case of alleged or suspected evasion of tax as well as
malpractices connected therewith. It also appears that under the provisions of
Section 7(3) no complaint is required to be presented before any authority as
has been done in the instant case but only a report is required to be submitted
before the Commissioner. Section 7(3) of the West Bengal Sales Tax Act, 1994
clearly says that the Bureau may, on information or of its own motion, or when
the State Government or the Commissioner so directs, carry out investigation or
hold inquiry into any case of alleged or suspected evasion of tax as well as
malpractices connected therewith and send a report in respect thereof to the
Commissioner. In the instant case, as it appears, the Bureau of Investigation
on its own accord and information carried out investigation but instead of
sending a report to the Commissioner on the basis of the said investigation,
sent a complaint before the Deputy Superintendent of Police, Bureau of
Investigation "against clear provisions of law" and the said Deputy
Superintendent of Police Forwarded the same to Hare Street Police
Stattion......." Further again the single judge observed thus "The
person who was making the FIR by forwarding a petition of complaint based on
investigation already done had no authority to direct the officer-in- charge,
that the case must be again investigated by his own subordinate officer Sri
Amitava Chakravorty and that too under the different sections of the IPC read
with Section 88(i)(6) & (7) of the West Bengal Sales Tax Act, 1994. Such a
procedure is unknown either in the Criminal Procedure Code or in the West
Bengal Sales Tax Act, 1994." The High Court expressed the opinion that
under the Sales Tax Act only a Bureau of Investigation constituted by the State
Government can conduct the investigation or hold inquiry into any case of alleged
or suspected evasion of tax as well as malpractices connected therewith, and
hence no police officer can investigate into the offences under the Indian
Penal Code or any other Act read with offences committed under Section 88 of
the Sales Tax Act.
It is apparent that learned single judge has
not been appraised of the danger involved in adopting such a farfetched legal
proposition. Assume that a person who committed any offence under section 88 of
the Sales Tax Act has also committed some other serious offence in connection
with perpetration of the former offence what would be position of the police if
the view adopted by the learned single judge is to be followed. Is it that
police force has merely to look askance at such persons helplessly on the mere
ground that an offence under Sales Tax Act is also involved and hence the
powers of the police are unenforceable in that condition? Learned single judge
of the High Court has relied on Section 4 of the Code of Criminal Procedure
(for short the `Code').
To find further support to his view that when
a special law is provided for dealing with offences there under such offence
can be dealt with only in accordance with the provisions of such special law.
To understand the scope of the said legal
trammel it is advantageous to refer to Section 4 of the Code. It is extracted
below:
4. Trial of offences under the Indian Penal
Code and other laws. - (1) All offences under the Indian Penal Code (45 of
1860) shall be investigated, inquired into, tried, and otherwise dealt with
according to the provisions hereinafter contained.
(2) All offences under any other law shall be
investigated, inquired into, tried, and otherwise dealt with according to the
same provisions, but subject to any enactment for the time being in force regulating
the manner or place of investigating, inquiring into, trying or otherwise
dealing with such offences." So far as the offences under Indian Penal
Code are concerned sub-section (i) mandates that they can be investigated into
and tried according to the provisions of the Code. When we go to sub-section
(ii) which concerns the offences "under any other law" it is again
the rule that such offences shall also be investigated and tried according to
the provisions of the Code itself, but with a rider that such investigation or
trial shall be subject to the regulation regarding "the manner or place
of" such investigation or trial prescribed in any enactment for the time
being in force. In Mirza Iqbal Hussain vs. State of Uttar Pradesh [1982 (3) SCC
516] a two judge bench of this Court (Chandrachud, CJ and Chinnappa Reddy, J.)
considered the contention that in a trial of offences under Prevention of
Corruption Act the special court has no power to confiscate any property in
view of Section 4(2) of the Code which excludes powers under the code while
dealing with offences under laws other than Indian Penal Code. After extracting
Section 4(2) of the Code learned judges observed as follows:
"It is clear from this provision that in
so far as the offences under laws other than the Indian Penal Code are
concerned, the provisions of the Code of Criminal Procedure apply in their full
force subject to any specific or contrary provision made by the law under which
the offence is investigated or tried." The Constitution Bench which
decided AR Antulay vs. RS Nayak [1984 (2) SCC 500] has cautioned that the Code
is the parent statute which provides for investigations, inquiry into, and
trial of cases and unless there is specific provision in other statute to
indicate a different procedure to be followed, the provisions of the Code
cannot be displaced. Taking cue from the said ratio this court held recently in
Gangula Ashok vs. State of Andhra Pradesh [JT 2001 SC 379] while interpreting
Section 4(2) of the Code as follows:
"A reading of the sub-section makes it
clear that subject to the provisions in other enactments all offences under
other laws shall also be investigated, inquired into, tried and otherwise dealt
with under the provisions of the Code. This means that if other enactment
contains any provision which is contrary to the provisions of the Code, such
other functions would apply in place of the particular provision of the Code.
If there is no such contrary provision in other laws, then provisions of the
Code would apply to the matters covered thereby." We did not come across
any provision in the Sales Tax Act which inhibits the powers of the police as
conferred by the Code. Chapter X of the Act deals with "Offences and
penalties." Section 88 falls within the said chapter.
Sub-section (1)c reads thus:
"Whoever- c fails to make payment of
interest payable under section 31 or section 32;.........shall be punishable
with simple imprisonment which may extend to six months or with fine not
exceeding one thousand rupees or with both.............." Section 88 (6)
& (7) are also extracted below:
(6) Whoever wilfully attempts in any manner
to evade or defeat any tax imposed under this Act, shall, in addition to any
other penalty provided by any law for the time being in force, be liable also
for the offence of dishonest misappropriation of property under section 403 of
the Indian Penal Code, and shall be punishable with imprisonment of either
description which shall not be less than three months but which may extend to
two years or with fine not exceeding ten thousand rupees or with both.
(7) Whoever knowingly produces incorrect
accounts, registers or documents, or knowingly furnishes incorrect information
or suppresses material information shall be punishable with imprisonment of
either description which shall not be less than three months but which may
extend to two years or with fine not exceeding ten thousand rupees or with
both." The offence envisaged in sub-section (6) is specifically created as
supplemental to any other penalty provided by any law for the time being in
force. This means, offences falling under the Indian Penal Code and committed
by a person while committing the offence contemplated in sub-section (6) cannot
get displaced for the sole reason that the accused has committed the offence
falling under sub-section (6) of Section 88.
Section 7(1) of the Sales Tax Act empowers
the State government to constitute a Bureau of Investigation for discharging
the functions referred to in sub-section (3) thereof. It empowers the Bureau to
carry on the investigation or hold enquiry into any case or alleged or
suspected case of evasion of tax or malpractice created thereof and send a
report of it to the Commissioner. A reading of Section 7 makes it clear that
creation of Bureau of Investigation for the purpose of discharging the function
envisaged in sub-section (3) which, of course, includes investigation also. But
there is nothing in Section 7 that such investigation can be carried on
"only" by the Bureau and not any other investigating agency. It is
open to the Bureau to get the assistance of any other legally constituted
investigating agency for effectively inquiring into all the ramifications of
the offence. As in this case if offences falling under the Indian Penal Code or
any other enactment are also detected during the course of investigation
conducted by the Bureau there is no inhibition to pass over the investigation
to the regular police.
If the view of the learned single judge gets
approval it would lead to startling consequences. The consequences of such an
interpretation would be that if the person who commits the offence under
Section 88 of the Act also commits other serious offences falling under Indian
Penal Code as part of the same transaction neiher the regular police nor any
special police force nor even the Central Bureau of Investigation can be
authorised to conduct investigation.
The accused in such cases would then be well
ensconced insulated from the legal consequences of proper and effective
investigation. Criminal justice would be the serious casualty then.
That apart, how could the FIR be quashed if
the investigating agency should have been different? By lodging FIR alone no
investigation is conducted by the police. It is the first step towards starting
investigation by the police. If High Court was of the opinion that
investigation has to be conducted by the Bureau then also there was no need to
quash the FIR. Any way we take the view that as offences under the Indian Penal
Code are also involved, efficacious investigation can be conducted by
entrusting it to the police investigating agency. Inherent powers of the High
Court as recognised in Section 482 of the Code are reserved to be used "to
give effect to any orders under the Code, or to prevent abuse of the process of
any court or otherwise to secure the ends of justice." It is quite
unfortunate that learned single judge overlooked the reality that by quashing
the FIR in the case the High Court did not achieve any one of the above
factors. On the contrary, the result of quashing the FIR had rendered the
allegation of offences made against a person to remain consigned in stupor
perennially. Hence, instead of achieving ends of criminal justice, the impugned
order would achieve the reverse of it.
So from any angle, the High Court has
committed serious error in quashing the FIR. We, therefore, allow this appeal
and set aside the impugned judgment.
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