for quashing, raised by an accused by invoking the power vested in the High Court under Section 482 of the Cr.P.C.:- (i) Step one, whether the material relied upon by the accused is sound, reasonable, and indubitable, i.e., the material is of sterling and impeccable quality? (ii) Step two, whether the material relied upon by the accused, would rule out the assertions contained in the charges levelled against the accused, i.e., the material is sufficient to reject and overrule the factual assertions contained in the complaint, i.e., the material is such, as would persuade a reasonable person to dismiss and condemn the factual basis of the accusations as false. (iii) Step three, whether the material relied upon by the accused, has not been refuted by the prosecution/complainant; and/or the material is such, that it cannot be justifiably refuted by the prosecution/complainant? (iv) Step four, whether proceeding with the trial would result in an abuse of process of the court, and would not serve the ends of justice? If the answer to all the steps is in the affirmative, judicial conscience of the High Court should persuade it to quash such criminal - proceedings, in exercise of power vested in it under Section 482 of the Cr.P.C. Such exercise of power, besides doing justice to the accused, would save precious court time, which would otherwise be wasted in holding such a trial (as well as, proceedings arising therefrom) specially when, it is clear that the same would not conclude in the conviction of the accused.-The Criminal Petitions are allowed and further proceedings in C.C.Nos.124 and 125 of 2013 respectively on the file of Special Judge for Economic Offencescum-Additional Metropolitan Sessions Judge, Hyderabad against the petitioners, who are A6 and A3, are hereby quashed.

SMT JUSTICE T. RAJANI   

CRIMINAL PETITION Nos.8618 of 2013   

22-12-2017

Shri Kersi H Vachha and another.PETITIONERS   
                               
State of A.P., Represented by the Public Prosecutor, High Court of A.P., Hyderabad and another. RESPONDENTS   

Counsel for the Petitioners:  MR. D. PRAKASH REDDY   
                               For MR. VIKRAM POOSERLA

Counsel for the Respondents:  PUBLIC PROSECUTOR(R1)     
                                MR. N. RAJESWARA RAO     

<Gist :
>Head Note:
? Cases referred:

1.1997(1) ALD (Crl.) 745 (AP)
2.2013(3) SCC 330

SMT JUSTICE T. RAJANI   

CRIMINAL PETITION Nos.8618 and 8835 of 2013   
COMMON ORDER:     
        Criminal Petition No.8618 of 2013 is filed by A6 in
CC.No.124 of 2013, while Criminal Petition No.8835 of 2013 is
field by A3 in CC.No.125 of 2013 seeking for quash of the
proceedings against the petitioners in CC.Nos.124 and 125 of
2013 respectively on the file of Special Judge for Economic
Offencescum-Additional Metropolitan Sessions Judge,
Hyderabad.

2.      The grounds, on which the petitions are filed, are almost
the same. Hence, they are taken up for a common consideration
and disposal.

3.      A perusal of the complaint in the foremost would be
profitable, in order to understand the allegations against these
petitioners. M/s. Global Trust Bank is Banking Company and 
obtained Certificate of Incorporation on 29.10.1993 vide
registration No.01-16502 of 1993-94 issued by the Registrar of
Companies, Hyderabad and the Certificate of Commencement of   
Business on 10.11.1993. A1 to A3 are the Directors of the
Company at the relevant point of time and A4 is the Company
Secretary and signatory to the balance sheet of the company, for
the relevant period. The balance sheet in C.C.No.8835/2013
pertains to the year 2002-03 and in C.C.No.8618/2013 it is for
the years 1998 to 2002. A6 in CC.No.124 of 2013 and A3 in
CC.No.125 of 2013 are stated to be the Auditors of the Company
and signatories to the balance sheet at the relevant point of
time.

4.      The facts of the case, as narrated in the complaint,
are that e-GTB, under the Chairmanship of one Ramesh Gelli,
acquired a reputation for aggressive growth. Lending/advances
was made in volatile and risky sectors, including the Capital
Market, often at the cost of prescribed norms, guidelines and
procedures. The stock market scam of 2001, led by one Ketan
Parekh group, further hit at the fundamentals of the Bank.
With the crisis of banking operations coming to a halt,
Mr. Ramesh Gelli, came under increasing fire and was removed
as CMD, to be replaced by Mr. R.S. Hugar. Consequent to
mounting troubles, the bank was placed under moratorium, by
the Reserve Bank of India (RBI) in July 24, 2004 up to October
23, 2004 and subsequently was amalgamated with the Oriental 
Bank of Commerce (OBC) in August 2004. Subsequent to the 
amalgamation, the OBC came across, in its view, serious
irregularities in the prior working of e-GTB management.
There was an investigation by the Serious Fraud Investigating
Office (SFIO). Prior to the said investigation, e-GTB has been
subject to scrutiny by the various agencies. RBI has conducted
periodical Annual Financial Inspection (AFI) and it observed
number of irregularities. It was found during investigation by
SFIO, that the promoters, along with their relatives and
associates, were found to have concealed material facts. From
the records, it was seen that e-GTB committed various
irregularities. It is evident that RBI, during Annual Financial
Inspection, also noticed several irregularities in A6 and A3 audit
period, such as the Bank not maintaining the real value of the
minimum capital prescribed. The auditors report annexed with
the relevant balance sheet was silent on certain issues, though it
was the duty of the statutory auditor to report such matters in
the auditors report.

5.      With the allegation that A6 and A3, being auditors, did not
submit auditors report and that they also signed the balance
sheet, the complaint was filed against them also.

6.      Now in these quash petitions, the petitioners counsel
raises several technical grounds which do not permit the
sustenance of the prosecution against A3 and A6. He submits
that A3 is not a signatory to the balance sheet and the same is
admitted and is evident from the balance sheet. He submits that
in spite of A6 being a signatory to the balance sheet, prosecution
cannot be launched against him under the Companies Act (for
short the Act), as Section 211 is not applicable to the Banking
Company. 

        Section 211 of the Act reads as under:
       211. (1) Every balance sheet of a company shall give
a true and fair view of shall, subject to the provisions of this
section, be in the form set out in Part I of Schedule VI, or as
near thereto as circumstances admit or in such other form
as may be approved by the Central Government either
generally or in any particular case; and in preparing the
balance sheet due regard shall be had, as afar as may be, to
the general instructions for preparation of balance sheet
under the heading Notes at the end of that Part:
       Provided that nothing contained in this sub-section
shall apply to any insurance or banking company or any
company engaged in the generation or supply of electricity
or to any other class of company for which a form of balance
sheet has been specified in or under the Act governing such
class of company.

    The proviso clearly exempts banking company from the
application of sub-section (1) of Section 211. Hence, even if a
balance sheet does not disclose true and fair facts of the state of
affairs of the company, a banking company cannot be
prosecuted under the Companies Act. There is no counter
argument to the said submission made by the petitioners
counsel.

7.      The next contention is that Section 628 of the Act does not
apply to the petitioners, as the balance sheet, which is prepared
under Section 211 of the Act, is hit by Section 211 and hence,
the Banking Company having been exempted under the proviso   
to Section 211(1), Section 628 of the Act also does not apply to
the petitioners.

8.      Section 628 of the Act is a penal provision not only for a
false statement but also for a false report. According to the
complaint, there was an auditors report annexed to the balance
sheet,which contain false particulars. Hence, prima facie, Section
628 of the Act applies. But the counsel raises an objection for
the case to be taken on file, on the ground that there is no
authorisation for the complainant to file complaint against these
petitioners, who are auditors.

9.      The other contention is that Section 235 of the Act does
not authorise the ministry of corporate affairs or any member of
SFIO to summon the petitioner to give any evidence.
        Section 235 is extracted hereunder for ready reference:
235. (1) the Central Government may, where a
report has been made by the Registrar under sub-
section (6) of the Section 234, or under sub-section
(7) of that section, read with sub-section (6) thereof,
appoint one or more competent persons as inspectors 
to investigate the affairs of a company and to report
thereon in such manner as the Central Government 
may direct.
                        (2) Where-
       (a) in the case of a company having a share
capital, an application has been received from not less
than two hundred members or from members holding   
not less than one-tenth of the total voting power
therein, and
       (b) in the case of a company having no share
capital, an application has been received from not less
than one-fifth of the persons on the companys
register of members.
       The Tribunal may, after giving the parties an
opportunity of being heard, by order, declare that the
affairs of the company ought to be investigated by an
inspector or inspectors, and on such a declaration
being made, the Central Government shall appoint
one or more competent persons as inspectors to
investigate the affairs of the company and to report
thereon in such manner as the Central Government
may direct.

10.     According to the above provision, the Central Government
shall appoint one or more competent persons as Inspectors, to
investigate the affairs of the company and report therein in such
a manner as the Central Government may direct.

11.     The counsel takes this court through the order of the
Director of Serious Fraud Investigation, wherein it is mentioned
that on the basis of the report submitted by the Inspectors
appointed by the Central Government in exercise of its powers
under Section 235 of the Act, in respect of Global Trust bank
Limited, Ministry of Corporate affairs by virtue of a letter, dated
23.07.2012 authorised Serious Fraud Investigation Office to file
complaints in respect of offences committed by the company and
its Directors under the Act.

12.     It is specific that the company and its Directors are the
persons against whom the complaint was directed to be filed.
The letter addressed by the Joint Director, Ministry of Corporate
Affairs, Government of India to the Director of Serious Fraud
Investigation, shows that the RBI is the Regulatory Authority of
the Bank and it has already filed complaint in the Court. It also
shows that it was taken note of, that regarding prosecution
under Section 628 of the Act, Section 211 exempts Banking 
Company. SFIO was also advised to forward his findings/charges
to RBI for further necessary action. It was also further advised to
re-examine the issue of prosecution under Section 628 as to how
it was applicable to the company, which was a banking company.

13.     While observing as such, SFIO was advised to initiate
prosecution against statutory auditors of relevant period under
Section 227 read with Section 233 and under Section 628 of Act.
But, however, it states that the matter may further also be
referred to the Institute of Chartered Accountants of India to
initiate disciplinary action against the statutory auditors of the
Bank. 

14.     Section 227 of the Act only lays down the powers and
duties of auditors while Section 233 of the Act is a penal
provision for the auditors report or any document of the
company being signed or authenticated otherwise than in
conformity with the requirement of Sections 227 and 229 of the
Act. The material and the correspondence between the Ministry
of Corporate affairs and the SFIO would show that they were
conscious of the fact that the Act would not apply to the Banking
Company and that the Global Trust Bank is a banking company. 
It was also conscious of the fact that Section 211 exempts the
auditors from the application of sub-section (1) of Section 211,
thereby, Section 628 of the Act does not apply, as the
authorization to file the complaint is only with regard to the
company and its directors.

15.     The counsel for R2 contends that the authorisation is given
not only to prosecute the company and its Directors but also
others, as the word etc is used in the said authorisation.
No doubt, the authorisation, in the prologue mentions the word,
etc. But while authorising one D.A. Sampath, who is the
complainant herein, it did not specify that apart from Company
and Directors, others also should be prosecuted. Hence, the
word, etc cannot be understood to mean that prosecution
against others was also intended by virtue of the said
authorisation. Nothing prevents the authorisation to clearly
specify the persons, against whom complaint is directed to be
filed.  However, this court was hesitant to allow the petition with
regard to the offence under Section 227 of the Act simply on the
ground that the authorization was not there, with a doubt that
the said error can be rectified subsequently by obtaining proper
authorisation to prosecute the auditors also. No support could be
drawn by either side in support of their respective contentions.
The contention of the petitioners, being that since the very basis
of the complaint is the authorisation, the prosecution gets
vitiated in the absence of any authorisation, the contention of
the respondent is that the lack of authorisation does not vitiate
the prosecution. But however, a ruling of this court could be
picked up by me, which is rendered in Satish & Co., v.
S.R.Traders and Ors. , wherein with a reasoning, which is
satisfactory to this court, it was held that the lack of
authorisation at the time of filing of the complaint cannot be
rectified subsequently. The Court posed to itself the question
whether even in cases where proper authorization letter or
power of attorney was not filed, along with the complaint,
whether the company can ratify such actions later or whether
such authorization letter can be filed later so as to regularize the
irregular proceedings. By observing that the object of law in all
such cases, that the complaint or suit shall be filed by a person
duly authorised, is that, such proceedings will definitely have
financial consequences on the company so as to bind the
company for the actions of such persons, held that even
subsequent authorisation would not regularize the irregularity
which was there at the time of filing the complaint. Here, in this
case, though such interest is not involved in the complainant
department, as is involved in case of a company, there should be
proper authority to file the complaint. When so much of exercise
goes into the decision of prosecuting a  person, as has gone in
this case, a complaint cannot be filed casually against a person,
without there being any authorisation. The complainant in this
case is not acting individually and he is acting on behalf of the
department, which has authorised him only to do a certain thing.
The complainant cannot go beyond the authorisation and file the
complaint against those persons, in respect of whom he is not
authorised. Hence, though, the matter dealt with by this High
Court related to a Company, on an analogical plane, it can be
applied to this case.
        The material produced by the petitioners is looked into as
it is permitted by the Apex Court in Rajiv Thapar and others vs.
Madan Lal Kapoor .  Relevant paragraph reads as follows:
       29. The issue being examined in the instant case is the
jurisdiction of the High Court under Section 482 of the Cr.P.C., if it
chooses to quash the initiation of the prosecution against an accused,
at the stage of issuing process, or at the stage of committal, or even
at the stage of framing of charges. These are all stages before the
commencement of the actual trial. The 1same parameters would 
naturally be available for later stages as well. The power vested in
the High Court under Section 482 of the Cr.P.C., at the stages
referred to hereinabove, would have far reaching consequences,
inasmuch as, it would negate the prosecutions/complainants case
without allowing the prosecution/complainant to lead evidence. Such
a determination must always be rendered with caution, care and
circumspection. To invoke its inherent jurisdiction under Section -
482 of Cr.P.C. the High Court has to be fully satisfied, that the
material produced by the accused is such, that would lead to the
conclusion, that his/their defence is based on sound, reasonable, and
indubitable facts; the material produced is such, as would rule out
and displace the assertions contained in the charges levelled against
the accused; and the material produced is such, as would clearly
reject and overrule the veracity of the allegations contained in the
accusations levelled by the prosecution/complainant. It should be
sufficient to rule out, reject and discard the accusations levelled by
the prosecution/complainant, without the necessity of recording any
evidence. For this the material relied upon by the defence should not
have been refuted, or alternatively, cannot be justifiably refuted,
being material of sterling and impeccable quality. The material relied
upon by the accused should be such, as would persuade a reasonable 
person to dismiss and condemn the actual basis of the accusations as
false. In such a situation, the judicial conscience of the High Court
would persuade it to exercise its power under Section 482 of the
Cr.P.C. to quash such criminal proceedings, for that would prevent
abuse of process of the court, and secure the ends of justice.
       30. Based on the factors canvassed in the foregoing
paragraphs, we would delineate the following steps to determine the
veracity of a prayer for quashing, raised by an accused by invoking
the power vested in the High Court under Section 482 of the
Cr.P.C.:-
       (i) Step one, whether the material relied upon by the accused
is sound, reasonable, and indubitable, i.e., the material is of sterling
and impeccable quality?
       (ii) Step two, whether the material relied upon by the
accused, would rule out the assertions contained in the charges
levelled against the accused, i.e., the material is sufficient to reject
and overrule the factual assertions contained in the complaint, i.e.,
the material is such, as would persuade a reasonable person to
dismiss and condemn the factual basis of the accusations as false.
       (iii) Step three, whether the material relied upon by the
accused, has not been refuted by the prosecution/complainant;
and/or the material is such, that it cannot be justifiably refuted by
the prosecution/complainant?
       (iv) Step four, whether proceeding with the trial would result
in an abuse of process of the court, and would not serve the ends of
justice?
       If the answer to all the steps is in the affirmative, judicial
conscience of the High Court should persuade it to quash such
criminal - proceedings, in exercise of power vested in it under
Section 482 of the Cr.P.C. Such exercise of power, besides doing
justice to the accused, would save precious court time, which would
otherwise be wasted in holding such a trial (as well as, proceedings
arising therefrom) specially when, it is clear that the same would not
conclude in the conviction of the accused.

15.     Hence, in view of the above, continuance of further
proceedings in C.C.Nos.124 and 125 of 2013, against the
petitioners, on the file of Special Judge for Economic Offences
cum-Additional Metropolitan Sessions Judge, Hyderabad would 
be a futile exercise and would only result in abuse of process of
law.

16.     The Criminal Petitions are allowed and further proceedings
in C.C.Nos.124 and 125 of 2013 respectively on the file of
Special Judge for Economic Offencescum-Additional  
Metropolitan Sessions Judge, Hyderabad against the petitioners,
who are A6 and A3, are hereby quashed. 

      As a sequel, the miscellaneous applications, if any pending,
shall stand closed.
_________ 
T. RAJANI, J
December 22, 2017

quash = Sections 120-B, 406, 420 read with Section 34 of the Indian Penal Code, 1860 and 156(3) of the Criminal Procedure Code. = When once the complainant has changed his course of action, from that of a criminal complaint to that of a civil dispute, by giving up the earlier complaint and by making effort to realize the damages, the dispute remains to be only civil dispute thereafter. = when the company is the accused its directors can be roped in only if there is sufficient incriminating evidence against them, coupled with intention, is made. In this case, except against A1 and A2, no allegations against A3 to A6 are made. They are not termed to be the people, who are in-charge of the day-to-day affairs of the petitioner bank. The persons, who signed on the bank guarantee, are the Manager and the Vice President. The manager is not shown in the list of the accused, though the vice president's signature is found. Whether it is of the second petitioner herein or not is not decipherable = However for the reasons aforementioned, prosecution cannot be sustained against any of the petitioners. It can be further said that the conception of the respondents of the act of the petitioner Bank as a criminal act stands erased, by his act of taking a civil course of action i.e. to realize damages. It implies that he has condoned the criminality, if any, in the act of the accused. He cannot, by the manner in which his grievance is addressed, change his line of action and paint the act of the accused, with a brush of criminality as and when he chooses. In the result, the criminal petition is allowed and the proceedings in Cr.No.57 of 2011 on the file of the Police Station Panjagutta, Hyderabad, against the petitioners, are hereby quashed.

SMT JUSTICE T. RAJANI   

CRLP.No.1405 of 2011 

22-12-2017

Axis Bank Limited and others. PETITIONERS   

State of Andhra Pradesh, Rep. by Public Prosecutor, High Court of AP, Hyderabad and another... RESPONDENTS   

Counsel for Petitioners:MR. S. NIRANJAN REDDY   
                                            For MR. N. NAVEEN KUMAR   
Counsel for Respondents :       PUBLIC PROSECUTOR             
                                                MR. M.V. SURESH  R2   
                               

<GIST   :
>HEAD NOTE:   
? Cases referred:
1.      (2011) 13 SCC 412
2.      (2006) 6 SCC 736
3.      2013(3) SCC 330 
4.      (2009) 3 SCC 78
5.      AIR 1992 SC 604 
6.      (2002) 1 SCC 652
7.      (2001) 7 SCC 659
8.      (1986) 3 SCC 67
9.      (2001) 2 SCC 17
10.     1998 CRLJ 4865 
11.     (2015) 6 SCC 287


SMT JUSTICE T. RAJANI   
CRIMINAL PETITION No.1405 of 2011   
ORDER: 

        The petitioners figure as accused in Cr.No.57 of 2011 on the file
of the Police Station, Panjagutta, Hyderabad. The offences alleged
against the petitioners are under Sections 120-B, 406, 420 read with
Section 34 of the Indian Penal Code, 1860 and 156(3) of the Criminal
Procedure Code. The petitioners have filed this petition seeking for
quash of the proceedings against them, in the above crime.

2.      Heard the counsel for the petitioners, the counsel for the second
respondent and the learned Public Prosecutor appearing on behalf of
the first respondent.

3.      The revocation of bank guarantee, which was taken with the
first petitioner bank herein, is the basis of this complaint. From the
averments in the complaint, it can be understood, that the
complainant is a company incorporated under the Companies Act, 
1956. During the course of its business, the complainant entered into
a contract with M/s. Orissa Computer Associates (OCA), for
construction and implementation of e-books and as per the terms of
the contract, the said OCA gave a bank guarantee for Rs.2.2 crores,
through the first petitioner and the bank guarantee was executed by
the first petitioner and its Manager and Vice President, D.
Bhattacharaya. The OCA provided copy of the said bank guarantee to
the complainant company, which is known to the first petitioner, which
was formally known as UTI Bank Limited. The tenure of the said bank
guarantee is one year from the date of its execution. One of the
conditions in the bank guarantee is that the first petitioner shall not
revoke the bank guarantee without prior written unconditional
approval/permission from the beneficiary, before expiry of the claim
period of the said bank guarantee. Based on and acting upon letter
dated 15.10.2003 given by the first petitioner, the complainant
company proceeded and opened a letter of credit for US $ 2,00,000
through Barclays Bank dated 18.11.2003 through Habib Bank Ag 
Zurich. The first petitioner did not send the original copy of the bank
guarantee, in spite of the demand by the complainant company,
though the same has to be made available to the complainant.

4.      The complainant company has been expecting the same to be 
delivered to it by the bank, but to its surprise, received a
communication from the first petitioner, dated 10.10.2003, stating
that the bank guarantee has been cancelled at the request of the
applicant for the same i.e. OCA and that the original has been
submitted to it by OCA. This act of cancellation of the bank guarantee
by the bank without written confirmation from the beneficiary is
contrary to well established business norms and is a clear violation of
the trust reposed by the complainant company.   It is clear that A1
and A2 colluded with OCA and acted in concert and made the 
complainant company to believe that there is existence of valid and
subsisting bank guarantee and acting upon the said belief, the
company opened valuable letters of credit. The Ombudsman, Reserve 
Bank of India, Bhuvaneshwar, after scrutinizing all the documents and
transactions, found something fishy and suspicious in the matter and
passed an order awarding damages of Rs.5.75 crores from Axis Bank 
Limited and also advised them to file both criminal complaint and civil
suits against the Axis Bank. Now the said amount has bulged into
Rs.10.76 crores with interest. A1 is the company incorporated under
the Companies Act while A3 to A18 are the Chairman cum Managing 
Director, Directors and Company Secretary respectively.

5.      Aggrieved by the said complaint, which is filed in the year 2010,
that is almost after seven years of taking the bank guarantee, the
petitioners come before this Court by way of this quash petition,
on the following grounds.

        The petitioners have nothing to do with the alleged offences.
The transaction, even if it is assumed to be true, is purely civil in
nature and hence, the registration of crime is unsustainable.
The petitioners issued bank guarantee at the request of its constituent
and customer OCA, in favour of the complainant and it appears that
there was a dispute between the customer of the petitioner and the
complainant and subsequently, OCA returned the original bank
guarantee to the first respondent for cancellation and since the original
bank guarantee is returned, as per the banking procedure, the same
was cancelled and the same was duly intimated to the complainant on
31.12.2003. OCA has procured the bank guarantee and as such, 
it ought to have made A1  and the correct officials representing it, as
accused and the alleged business transaction of the complainant is
with OCA and not with the petitioner bank. When the guarantee issued
by the petitioner bank has not reached the hands of the complainant,
the contract of guarantee cannot be expected to be commenced. In
fact, till the bank guarantee reached the complainant, no contractual
relationship of guarantor bank and complainant/beneficiary is
established. Moreover, nobody acted under the bank guarantee, since
the same is cancelled by surrendering the original bank guarantee to
the petitioner bank. Therefore, malafides or the ground that the
complainant opened letter of credit cannot be pleaded as a ground for
the complaint. When the complainant has not insisted on the original
bank guarantee, even after coming to know that OCA has agreed to
issue such a bank guarantee to them, clearly shows that no such
contract has come into existence. As per the Contract Law, the original
bank guarantee has to be obtained by the beneficiary and only after
tendering the same to the bank, it can be invoked. When the
complainant itself has no right, it cannot claim or prosecute the
petitioners for the alleged offences. The complaint alleged by the
complainant before the banking ombudsman is rejected by order dated
30.04.2005. The averments in the complaint that damages were
awarded by the Ombudsman is not correct. No such award was passed   
by the Ombudsman. Even assuming that the Ombudsman advised the     
complainant to file criminal case, lodging a complaint at very belated
stage is a clear, deliberate and intentional act on the part of the
complainant. There are no allegations in the complaint that there was
any fraudulent intention at the time of execution. The bank guarantee
was cancelled in December 2003 and at that time, the
Executives/Directors of petitioner bank, who were arrayed as A3, A4,
A7 to A16, were not in the petitioner bank as Executives/Directors and
all of them joined the petitioner bank at a later period and hence, they
cannot be made liable.
6.      From the arguments extended on either side, the points that
come up for consideration are:
1.      Whether the allegations in the complaint would
constitute the alleged offences, prima facie

2.      Whether the delay in the complaint would vitiate it.

3.      Whether the allegations in the complaint would
make all the petitioners liable for the alleged
offences.

4.      To what result.

POINT No.1:   
7.      The offences for which the complaint was filed are section 420
and 406 IPC. The counsel for the petitioners contends that there is no
breach of trust that is committed by the petitioners, as, for a breach of
trust to be committed, there should be entrustment of property,
as required under Section 405 IPC, which defines criminal breach of
trust. The same is extracted hereunder for quick reference and
understanding:
405. Criminal Breach of Trust.- Whoever, being in any
manner entrusted with property, or with any dominion over
property, dishonestly misappropriates or converts to his own
use that property, or dishonestly uses or disposes of that
property in violation of any direction of law prescribing the
mode in which such trust is to be discharged, or of any legal
contract, express or implied, which he has made touching the
discharge of such trust, or wilfully suffers any other person so
to do, commits criminal breach of trust.

8.      The Supreme Court in its decision in M/s. THERMAX LTD. v.
K.M. JOHNY  observed as under: 

Though a case of breach of trust may be both a civil wrong
and a criminal offence but there would be certain situations
where it would predominantly be a civil wrong and may or may
not amount to a criminal offence

        It also observed that in few cases the question arose whether
criminal prosecution can be permitted when the dispute between the
parties is predominantly of civil nature and the proper remedy would
be a civil suit.

        In INDIAN OIL CORPN. v. NEPC INDIA LTD.  the Supreme   
Court extracted the observations made by it in an earlier case, which
are as under:
23. In Chelloor Mankkal Narayan Ittiravi Nambudiri v. State of
Travancore, Cochin [AIR 1953 SC 478], this Court held:

"To constitute an offence of criminal breach of trust, it is
essential that the prosecution must prove, first of all, that
the accused was entrusted with some property or with
any dominion or power over it. It has to be established
further that in respect of the property so entrusted, there
was dishonest misappropriation or dishonest conversion
or dishonest use or disposal in violation of a direction of
law or legal contract, by the accused himself or by
someone else which he willingly suffered to do.

It follows almost axiomatically from this definition that the
ownership or beneficial interest in the property in respect
of which criminal breach of trust is alleged to have been
committed, must be in some person, other than the
accused and the latter must hold it on account of some
person or in some way for his benefit."

9.      Whether the interest that the complainant had in the bank
guarantee can be termed as property and whether the revocation of
the bank guarantee without informing it, in violation of the specific
condition to that effect in the bank guarantee, would amount to breach
of trust is the aspect, which needs examination in this case.
The agreement between the complainant and OCA was entered on   
29.09.2003. Clause (4) in the said agreement would touch upon the
bank guarantee. The clause reads as under:

4. This EMD may be deposited in the form of a BG/Inland LC in
the name of Atlantic Trade Info PVT Ltd., payable at India.
In case, if the service provider submits a BG, then the format
shall be as approved by the purchaser, such that the same shall
be encasheable on establishment of the relevant LC EMD may 
be paid partly in one mode and partly in another mode.

10.     From a reading of the above clause, the understanding that
comes is, taking of the bank guarantee by OCA was not a
pre-condition and it was not mandatory.  The wording of the said
clause would show that it was an option given to OCA with regard to
the EMD. The wording In case, if the service provider submits a BG,
then the format shall be as approved by the purchaser ... would mean
that at the option of OCA, which is referred as service provider, only,
the bank guarantee shall be taken. The clause wherein it is stated that
EMD may be paid partly in one mode and partly in another mode
would also support the said understanding. But, however, if a bank
guarantee is taken by exercising the option given under the said
agreement and when there is a clause in the bank guarantee to the
specific effect that the bank guarantee shall not be revoked without
prior written unconditional approval/permission from the beneficiary, it
would amount to breach of trust.  Whether it would attract and satisfy
the legality underlying the said phrase and whether it would satisfy the
requirement of Section 405 IPC has to be seen.

11.     The Supreme Court in INDIAN OIL CORPN.s case (2 supra) 
has explained the criminal breach of trust as follows:
22. A careful reading of the section shows that a criminal
breach of trust involves the following ingredients : (a) a person
should have been entrusted with property, or entrusted with
dominion over property; (b) that person should dishonestly
misappropriate or convert to his own use that property, or
dishonestly use or dispose of that property or willfully suffer
any other person to do so; (c) that such misappropriation,
conversion, use or disposal should be in violation of any
direction of law prescribing the mode in which such trust is to
be discharged, or of any legal contract which the person has
made, touching the discharge of such trust. The following are
examples (which include the illustrations under section 405)
where there is 'entrustment':

(i) An 'Executor' of a will, with reference to the estate of
the deceased bequeathed to legatees.

(ii) A 'Guardian' with reference to a property of a minor or
person of unsound mind.

(iii) A 'Trustee' holding a property in trust, with reference
to the beneficiary.

(iv) A 'Warehouse Keeper' with reference to the goods
stored by a depositor.

(v) A carrier with reference to goods entrusted for
transport belonging to the consignor/consignee.

(vi) A servant or agent with reference to the property of
the master or principal.

(vii) A pledgee with reference to the goods pledged by the
owner/borrower.

(viii) A debtor, with reference to a property held in trust
on behalf of the creditor in whose favour he has executed
a deed of pledge-cum-trust. (Under such a deed, the
owner pledges his movable property, generally
vehicle/machinery to the creditor, thereby delivering
possession of the movable property to the creditor and
the creditor in turn delivers back the pledged movable
property to the debtor, to be held in trust and operated
by the debtor).

        The examples given by the Supreme Court are not exhaustive
and the trust that was reposed in the bank while the bank guarantee
was taken, would be similar to the trust, which is the third example
cited by the Supreme Court.  When once OCA has taken the bank 
guarantee in pursuance of an agreement with the complainant, the
interest in the bank guarantee would become a property of the
beneficiary and the breach of trust involved in the said bank guarantee
would definitely be an offence against the beneficiary. It is after all
taken as a guarantee for the performance of the part of the
beneficiary, in the contract. If the bank guarantee becomes a basis of
the contract, it would definitely become a property, held by the bank,
as a trustee of the beneficiary. Hence, the above discussion would
satisfy this Court to come to the conclusion that the monetary interest
involved in the bank guarantee, which is to the benefit of the
beneficiary, would fall within the definition of property under Section
405 IPC.

12.     As regards Section 420 IPC, the counsel for the petitioners
contends that in order to constitute the said offence, the complainant
has to prove that there was an intention on the part of the petitioners,
from the inception of the bank guarantee, to cheat the complainant. In
support of his argument, he takes the help of the decision of the
Supreme Court in INDIAN OIL CORPN.s case (2 supra) wherein the 
Supreme Court, by cogitating Section 415 IPC and by referring to it's
earlier decision in RAJESH BAJAJ v. STATE OF NCT OF DELHI   
[(199) 3 SCC 259] observed that it is not necessary that a
complainant should verbatim reproduce in the body of the complaint,
all the ingredients of the offence he is alleging nor is it necessary that
the complainant should state in so many words that the intention of
the accused was dishonest or fraudulent. It also observed that the
crux of the postulate is the intention of the person who induces the
victim of his representation and not the nature of the transaction
which would become decisive in discerning whether there was
commission of offence or not.

13.     In order to understand whether such element of cheating
existed in the minds of the petitioners in this case, it would be
beneficial to refer to the contents of the complaint. Except mentioning
that the first petitioner bank has revoked the bank guarantee without
intimating the same to the complainant, there is no averment in the
complaint that they had an intention to cheat the complainant, from
the inception of the bank guarantee. It is only by virtue of the act of
the petitioner bank, in cancelling the bank guarantee, that the
complainant infers that the petitioner bank has cheated it.
The correspondence between the complaint and the Ombudsman of   
the RBI is filed by the counsel for the petitioner. The same is not
refuted by the complainant. By virtue of the decision in RAJIV
THAPAR v. MADAN LAL KAPOOR , the apex court permitted certain     
documents to be relied upon.  Relevant paragraph reads as follows:
29. The issue being examined in the instant case is the
jurisdiction of the High Court under Section 482 of the Cr.P.C.,
if it chooses to quash the initiation of the prosecution against
an accused, at the stage of issuing process, or at the stage of
committal, or even at the stage of framing of charges. These
are all stages before the commencement of the actual trial. The
1same parameters would naturally be available for later stages
as well. The power vested in the High Court under Section 482
of the Cr.P.C., at the stages referred to hereinabove, would
have far reaching consequences, inasmuch as, it would negate
the prosecutions/complainants case without allowing the
prosecution/complainant to lead evidence. Such a
determination must always be rendered with caution, care and
circumspection. To invoke its inherent jurisdiction under Section
- 482 of Cr.P.C. the High Court has to be fully satisfied, that the
material produced by the accused is such, that would lead to
the conclusion, that his/their defence is based on sound,
reasonable, and indubitable facts; the material produced is
such, as would rule out and displace the assertions contained in
the charges levelled against the accused; and the material
produced is such, as would clearly reject and overrule the
veracity of the allegations contained in the accusations levelled
by the prosecution/complainant. It should be sufficient to rule
out, reject and discard the accusations levelled by the
prosecution/complainant, without the necessity of recording
any evidence. For this the material relied upon by the defence
should not have been refuted, or alternatively, cannot be
justifiably refuted, being material of sterling and impeccable
quality. The material relied upon by the accused should be
such, as would persuade a reasonable person to dismiss and
condemn the actual basis of the accusations as false. In such a
situation, the judicial conscience of the High Court would
persuade it to exercise its power under Section 482 of the
Cr.P.C. to quash such criminal proceedings, for that would
prevent abuse of process of the court, and secure the ends of
justice.
       30. Based on the factors canvassed in the foregoing
paragraphs, we would delineate the following steps to
determine the veracity of a prayer for quashing, raised by an
accused by invoking the power vested in the High Court under
Section 482 of the Cr.P.C.:-
       (i) Step one, whether the material relied upon by the
accused is sound, reasonable, and indubitable, i.e., the material
is of sterling and impeccable quality?
       (ii) Step two, whether the material relied upon by the
accused, would rule out the assertions contained in the charges
levelled against the accused, i.e., the material is sufficient to
reject and overrule the factual assertions contained in the
complaint, i.e., the material is such, as would persuade a
reasonable person to dismiss and condemn the factual basis of
the accusations as false.
       (iii) Step three, whether the material relied upon by the
accused, has not been refuted by the prosecution/complainant;
and/or the material is such, that it cannot be justifiably refuted
by the prosecution/complainant?
       (iv) Step four, whether proceeding with the trial would
result in an abuse of process of the court, and would not serve
the ends of justice?

If the answer to all the steps is in the affirmative, judicial
conscience of the High Court should persuade it to quash such
criminal - proceedings, in exercise of power vested in it under
Section 482 of the Cr.P.C. Such exercise of power, besides
doing justice to the accused, would save precious court time,
which would otherwise be wasted in holding such a trial (as well
as, proceedings arising therefrom) specially when, it is clear
that the same would not conclude in the conviction of the
accused.

14.     The material now relied upon by the petitioners in this case,
would fall within the categories of the material permitted by the Apex
Court, in the above ruling. The complainant reported the matter to
RBI, which acknowledged the receipt of the letter of the complainant
dated 31.10.2004 and mentioned that the complaint was referred to
the concerned bank as per the usual procedure, for necessary action.
The office of the banking Ombudsman addressed a letter to the
complainant referring to the complaint given by the complainant and
calling upon the Branch Manager, UTI Bank Limited, Bhuvaneshwar 
Branch and called upon the complainant to be present on a scheduled
date. The findings of the Ombudsman, as reflected in the complaint
given by the complainant, are as under:
(v) It is also a fact that once the LC was established a
transaction had commenced, and on the establishment of the
LC the beneficiary rights under the Bank Guarantee
automatically devolve on the LC opener. There can be no other
interpretation of clause 7 of the Bank Guarantee. Further,
nowhere in the BG it is stated that the original BG is required
for invoking. In banking law and practice it is amply clear that
there should be proof of the identity of the person who invokes
the guarantee and not the mere possession of a certain
document. A document may be lost or misplaced but this in no
way negates the ownership in the eyes of the law. This applies
not only to guarantees but also to other negotiable instrument.
Once it is clear who the beneficiary is he and only he will the
powers to invoke or for that matter revoke the instrument.

(vi) We cannot understand, how UTI bank can come to the
conclusion that whoever have in their possession the original
BG has a right to revoke it even if the beneficiary of the BG is
different. It that were the case then the entire concept, of the
BG mentioning the name and address of the beneficiary is
vitiated and in fact, the entire concept purpose of a BG is
defeated. Whether or not the beneficiary insists on obtaining
the original BG is not a matter for UTI Bank consider. Further,
the UTI Bank is no one to tell how business is to be carried out.
The matters of trust and good faith are as much implicit in a
business as others.

(vii) In para 4 of the letter issued by UTI Bank, on
UTIB/CO/LEG/04/3329 dated 27th May 2004, the bank states 
 A mere letter from the client stating that he has obtained a
Bank Guarantee is not sound proof to quote the alleged clauses
of the Bank Guarantee  It would seem that UTI Bank has
forgotten that they issued a letter confirming the issue of a
Bank Guarantee with a slight amendment to clause 7 of the BG.

(viii) UTI Bank in their above mentioned letter also states that
the undertaking given by them in clause 2 of the BG (Sec 7(a)
is only applicable when the beneficiary has the original
guarantee. This contention is absurd to say the least.

(ix) Lastly, we would like to make it very clear that it is the
banks duty to get written permission of BG beneficiary, before
any attempt of cancellation is made. We at no time gave any
authority to UTI Bank to hand over the original BG to the
applicant. Does the bank hand over the original LC to the
opener?

15.     From the said complaint, it can be understood that the defence
taken by the petitioner bank, before the ombudsman, is that the
revocation of bank guarantee is based on the production of original
bank guarantee by OCA. But the fact remains that the original bank
guarantee was not received by the complainant before it was revoked.
Hence, whether the letter of credit taken by the complainant is based
on the assurance underlying the bank guarantee is no understandable.
It also can be understood that the plea of the petitioners before the
ombudsman is that in the usual course, the bank guarantee would be
revoked on the production of original bank guarantee. But, however,
by virtue of the clause under the bank guarantee that the same shall
not be revoked without information to the beneficiary, the bank is
obliged to inform the complainant before the bank guarantee is
revoked, irrespective of at whose instance it is being revoked and
irrespective of the production of original B.G. Whether the element of
cheating was read into the said act of the bank, by the complainant,
and whether it was conceived, as an act of cheating, can be
understood by conduct of the complainant, subsequent to the
revocation of the bank guarantee.

16.     As observed earlier, the matter was taken to the Ombudsman
and a letter written to the Ombudsman by the complainant on
05.04.2005 would show that the complainant did not treat the act of
the petitioner bank as an act of cheating and it was satisfied with an
effort to realize the loss caused to it, by way of damages. The letter
stipulates that they are interested in keeping good banking
relationship with UTI Bank and they called upon the UTI to indicate the
compensation amount for the actual loss, which they fondly hope,
would be much reasonable. Hence, the said letter is an evidence of the
satisfaction of the complainant, after the deliberations with
Ombudsman and that it wanted to rest content with recovery of
damages. The complainant also gave another report to the police in
the year 2004 but it appears that it did not go ahead with pursuing the
said report and it took a different course of action by referring the
matter to the Ombudsman and making an effort to realize the amount
from the petitioner bank and it is not known as to what happened to
the above mentioned letter and in the year 2010, the complainant
comes up with filing of this complaint.

POINT No.2:  The complaint is assailed by the petitioners as hit by
laches.

17.     In M/s. THERMAX LTD.s case (1 supra) the Court came to 
deal with the aspect of inordinate delay and laches in the complaint
and held that such delay itself would show that the complaint is
inherently improbable; contains the flavour of civil nature and
considering as such, the Supreme Court held that the Magistrate
committed grave error in calling for a report under Section 156(3) of
the Criminal Procedure Code. In the said case, the dispute related to
the years 1993  1995 and complaint was filed in the year 2002.
In this case, even if the period is construed from the date of filing of
the earlier report i.e. in the year 2004, the delay is about six years.

18.     The counsel for the petitioners argues that since the
complainant lost his civil right, he has come up with this compliant
after such a long time.

19.     When once the complainant has changed his course of action, 
from that of a criminal complaint to that of a civil dispute, by giving up
the earlier complaint and by making effort to realize the damages,
the dispute remains to be only civil dispute thereafter. The Supreme
Court in V.Y. JOSE v. STATE OF GUJARAT  observed that there 
exists a distinction between pure contractual dispute of a civil nature
and an offence of cheating. Although breach of contract per se would
not come in the way of initiation of criminal proceedings, there cannot
be any doubt whatsoever that in the absence of the averments made
in the complaint petition wherefrom the ingredients of the offence can
be found out, the Court should not be hesitate to exercise its
jurisdiction under Section 482 C.P.C.

20.     The counsel for the respondent No.2 furnishes several decisions,
all of which are on the parameters for quash of criminal proceedings.
This Court is aware of the parameters on the basis of which quash of
the proceedings can be done, which were laid down by the Apex Court
in STATE OF HARYANA v. CH. BHAJANLAL , wherein it was held     
that in the exercise of the extra-ordinary power under Article 226 or
the inherent powers under Section 482 of the Code of Criminal
Procedure, the following categories of cases are given by way of
illustration, wherein such power could be exercised either to prevent
abuse of the process of any Court or otherwise to secure the ends of
justice, though it may not be possible to lay down any precise, clearly
defined and sufficiently channelised and inflexible guide, myriad kinds
of cases wherein such power should be exercised;
a) Where the allegations made in the First Information Report
or the complaint, even if they are taken at their face value and
accepted in their entirety do not prima facie constitute any
offence or make out a case against the accused;

b) Where the allegations in the First Information Report and
other materials, if any, accompanying the F.I.R. do not disclose
a cognizable offence, justifying an investigation by police
officers under Section 156(1) of the Code except under an
order of a Magistrate within the purview of Section 155(2) of
the Code;

c) Where the uncontroverted allegations made in the FIR or
complaint and the evidence collected in support of the same do
not disclose the commission of any offence and make out a
case against the accused; 

d) Where the allegations in the FIR do not constitute a
cognizable offence but constitute only a non-cognizable offence,
no investigation is permitted by a police officer without an order
of a magistrate as contemplated under Section 155(2) of the
Code; 

e) Where the allegations made in the FIR or complaint are so
absurd and inherently improbable on the basis of which no
prudent person can ever reach a just conclusion that there is
sufficient ground for proceeding against the accused;

f) Where there is an express legal bar engrafted in any of the
provisions of the Code or the concerned Act (under which a
criminal proceeding is instituted) to the institution and
continuance of the proceeding and/or where there is a specific
provision in the Code or the concerned Act, providing
efficacious redress for the grievance of the aggrieved party;

g) Where a criminal proceeding is manifestly attended with
mala fide and/or where the proceeding is maliciously instituted
with an ulterior motive for wreaking vengeance on the accused
and with a view to spite him due to private and personal
grudge.

       The above decision is the basis on which the decision reported
in STATE OF BIHAR v. MD. KHALIQUE  is rendered. The decision in 
S.M. DATTA v. STATE OF GUJARAI  considered the decision in   
CH. BHAJANLALs case (5 supra) and the proposition laid down 
therein are reiterated. So also, the decision of the Supreme Court in
J.P. SHARMA v. VINOD KUMAR JAIN , though the decision does not   
refer to CH. BHAJANLALs case (5 supra), the principles laid down
are the same.

21.     The counsel for the respondents also relied on the decision of
the Supreme Court in LALMUNI DEVI v. STATE OF BIHAR  in   
support of his contention that merely because the complaint spells out
a civil wrong, it is not justified to quash the complaint, if the alleged
acts make out an offence. But, in this case, it s not on the basis of that
the complaint spells out a civil wrong that the crime is held to be liable
as quashed but for the reasons mentioned above. Hence, the said
decision does not bear any relevance. The decision of this Court in
L. RAJA KRISHNA REDDY v. STAWIK DRUGS LIMITES  is also on       
the same lines and it also referred to CH. BHAJANLALs case
(5 supra).

POINT No.3:
22.     With regard to the petitioners being brought to book,
the counsel for the petitioners relied on a decision of the Supreme
Court in SUNIL BHARTI MITTAL v. CENTRAL BUREAU OF        
INVESTIGATION  wherein an observation that the principle that
criminal intent of person(s) controlling company can be imputed to
company based on the principle alter ego cannot be applied reversely
and when the company is the accused its directors can be roped in
only if there is sufficient incriminating evidence against them, coupled
with intention, is made. In this case, except against A1 and A2,
no allegations against A3 to A6 are made. They are not termed to be
the people, who are in-charge of the day-to-day affairs of the
petitioner bank. The persons, who signed on the bank guarantee, are
the Manager and the Vice President. The manager is not shown in the
list of the accused, though the vice president's signature is found.
Whether it is of the second petitioner herein or not is not decipherable.

23.     However for the reasons aforementioned, prosecution cannot be
sustained against any of the petitioners. It can be further said that the
conception of the respondents of the act of the petitioner Bank as a
criminal act stands erased, by his act of taking a civil course of action
i.e. to realize damages. It implies that he has condoned the
criminality, if any, in the act of the accused. He cannot, by the manner
in which his grievance is addressed, change his line of action and paint
the act of the accused, with a brush of criminality as and when he
chooses. 

POINT No.4:

        In the result, the criminal petition is allowed and the
proceedings in Cr.No.57 of 2011 on the file of the Police Station
Panjagutta, Hyderabad, against the petitioners, are hereby quashed.
As a sequel, the miscellaneous petitions, if any pending, shall stand
closed.
__________ 
T. RAJANI, J
December 22, 2017

quashing of criminal case Sections 465, 467, 468, 471 and 420 IPC. = It was held that in order to attract the clause secondly under Section 464 IPC, the alteration of a document has to be for some gain or for some objective of the accused. = The first ground, on which quash is sought for, is that the petitioner is not the person who signed on the disputed letter and the person, who signed on the said letter, is not brought to book for the alleged offence and this petitioner is only Secretary and Correspondent, who handed over the letter to the AICTE, without knowing as to whether the said letter is genuine or forged. The second ground is that the AICTE, in fact, was not mislead by the letter given by the petitioner. There was another letter given by the Andhra Bank, sanctioning Rs.5 crores and the said amount would satisfy the requirements of AICTE for granting approval. = A perusal of the said letter shows that it was not signed by the petitioner and he is not the applicant. Hence, from the said angle also, strength is gained to the petitioners pleas and the prosecution against the petitioner cannot be sustained.- the Apex Court in Parminder Kaur v. State of U.P. , wherein the facts are that the accused is alleged to have altered dates in the certified copy of revenue record. It was held that in order to attract the clause secondly under Section 464 IPC, the alteration of a document has to be for some gain or for some objective of the accused. It was also held that merely changing a document does not make it a false document. The Supreme Court considered that adding of figure 1 in the date in document, in question, cannot be said that the document became false for the simple reason that the appellant/accused had nothing to gain from the same and she was not going to save the bar of limitation.

SMT JUSTICE T. RAJANI   

CRLP.No.1778 of 2013 

20-12-2017

D.B.Suresh Babu  PETITIONER   

State, represented by SHO, Kavali Rural P.S., rep. by Public Prosecutor and another... RESPONDENTS 

Counsel for Petitioners:MR. N.BHARAT BABU   

Counsel for Respondent  :       PUBLIC PROSECUTOR     

<GIST   :

>HEAD NOTE:   

? Cases referred:
1.AIR 2010 SC 840 

SMT JUSTICE T. RAJANI   

CRIMINAL PETITION No.1778 of 2013   

ORDER: 

        This petition is filed seeking for quashment of the
proceedings against the petitioner  in C.C.No.528 of 2012 on the
file of Additional Judicial Magistrate of First Class, Kavali.  The
offences alleged are under Sections 465, 467, 468, 471 and 420
IPC.

2.      Heard the counsel for the petitioner and the Public
Prosecutor appearing for respondent No.1.  None appears for
respondent No.2 in spite of notice.

3.      The complaint is filed against the petitioner with the
following allegations:
        The petitioner intended to establish Engineering College at
Maddurupadu Village of Kavali Mandal.  As per the norms laid
down in clause 13.5 of All India Counsel for Technical Education
(AICTE), a new Engineering and Technology College is required
to have funds of Rs.1 crore for building and Rs.1 crore for
equipment and Library, at its disposal, for stating a new college,
besides an amount of Rs.35 lakhs  in Joint FDR. The accused,
who was having meagre amount in the current account of Indian
Bank, Kavali Branch, Kavali, on behalf of the Society i.e..,
D.S.Naidu Educational Society, orchestrated a plan to create
forged documents.  In pursuance of his plan, he created forged
document i.e., letter, dated 24.12.2008, purportedly issued by
the Indian bank, Kavali Branch, addressed to the Member
Secretary, AICTE, New Delhi, certifying that M/s.Damisetty
Srinivasa Naidu Educational Society, Kavali was having balance
of Rs.2,46,34,500/- in their Current Account, in support of its
fund position and also created some other forged documents in
respect of his account.  The accused enclosed copy of the said
forged letter dated 24.12.2008 issued by the Indian Bank, for
grant of approval.  The application was forwarded and believing
the said documents, approval was given after hearing the
accused.   A fake letter purportedly issued by the Indian Bank
dated 23.02.2009 was also produced by the accused, wherein it
was certified that their Society had balance of Rs.1,89,76,600/-.
The accused obtained consent letter from Andhra Bank, Kavali
Branch, in which LW5 provisionally agreed to sanction a loan of
Rs.5 Crores.  Having believed the said documents, the letter of
approval was given on 30.06.2009.  Later, a case was registered
at CBI, ACB, Visakhapatnam, on the allegation that some 
unknown officers of AICTE, in collusion with the management of
the Educational Societies, granted approval for establishment of
Engineering Colleges and CBI submitted a report to the higher
authorities of AICTE for taking necessary steps to lodge a
complaint against the Secretary and Correspondent.

4.      Now the argument of the petitioners counsel is two fold.
The first ground, on which quash is sought for, is that the
petitioner is not the person who signed on the disputed letter
and the person, who signed on the said letter, is not brought to
book for the alleged offence and this petitioner is only Secretary
and Correspondent, who handed over the letter to the AICTE,
without knowing as to whether the said letter is genuine or
forged.  The second ground is that the AICTE, in fact, was not
mislead by the letter given by the petitioner.  There was another
letter given by the Andhra Bank, sanctioning Rs.5 crores and the
said amount would satisfy the requirements of AICTE for
granting approval. The said fact is not disputed. The counsel
further submits that the complaint discloses that the sanction of
Rs.5 crores by Andhra Bank was also a basis for sanctioning the
approval and hence, it amounts to the Society fulfilling the
conditions laid down by the AICTE. The counsel also submits that
by the date of getting approval itself, constructions were made
to a large extent and that the college was being run successfully
since 10 years.

5.      The counsel relies on a ruling of the Apex Court in
Parminder Kaur v. State of U.P. , wherein the facts are that
the accused is alleged to have altered dates in the certified copy
of revenue record.  It was held that in order to attract the clause
secondly under Section 464 IPC, the alteration of a document
has to be for some gain or for some objective of the accused.  It
was also held that merely changing a document does not make it 
a false document. The Supreme Court considered that adding of
figure 1 in the date in document, in question, cannot be said
that the document became false for the simple reason that the
appellant/accused had nothing to gain from the same and she
was not going to save the bar of limitation.

6.      The facts of this case would also show that there was no
benefit that was gained by the Society for which the petitioner
herein is a Secretary, by submitting the impugned letter given
by the General Manager, which is allegedly a forged letter.  The
AICTE, however, had the security that is given by the Andhra
Bank and hence, this case is also a case similar to the one dealt
with by the Apex Court (referred supra), where no gain is
achieved by the accused by submitting the said letter.  A perusal
of the said letter shows that it was not signed by the petitioner
and he is not the applicant. Hence, from the said angle also,
strength is gained to the petitioners pleas and
the prosecution against the petitioner cannot be sustained.

7.      With the above observations, the Criminal petition is
allowed and the proceedings in C.C.No.528 of 2012 on the file of
Additional Judicial Magistrate of First Class, Kavali, against the
petitioner, shall stand quashed.

        As a sequel, the miscellaneous applications, if any pending,
shall stand closed.
__________ 
T. RAJANI, J
December 20, 2017

compensation = The evidence of P.W.3 shows that he was working as a Branch Manager and that the deceased was issued agent licence on 03.03.2008 and he received Rs.40,517/- towards commission for the business done during that period. The counsel for the appellants contends that between March 2008 and November 2008 itself the deceased could get the commission of Rs.40,517/-, which would show that he would, in all probability, earn huge amounts in future. The said fact glares from the evidence of P.W.3 and the same cannot be ignored. = The income of Rs.40,517/- is only for a period of eight months i.e. March 2008 to November 2008. Since the income of the deceased is stated to be only Rs.40,517/-, he would not be liable for tax, as the income would not exceed taxable limits. If Rs.40,517/- is taken for calculation of the income of the deceased, the monthly income would come to Rs.40,517/- x 1/8 = Rs.5,064/- and the annual income would come to Rs.5,064/- x 12 = Rs.60,768/-. If the future hike at 25% is added, the annual income would come to Rs.60,768/- + (Rs.60,768/- x 25% = Rs.15,192/-) = Rs.75,960/-. Since the claimants are four in number, 1/4th has to be deducted towards his personal expenditure as per the decision of the Supreme Court in SARLA VERMA v. DELHI TRANSPORT CORPORATION . Hence, after deducting 1/4th, the income would come to Rs.75,960/- - (Rs.75,960/- x = Rs.18,990/-) = Rs.56,961/-. The age of the deceased, being 41 years, the multiplier relevant as per the decision of the Supreme Court in SARLA VERMAs case (2 supra) is 14. Hence, the loss of future income to the claimants would come to Rs.56,961 x 14 = Rs.7,97,454/-. Apart from the above, following the decision of the Supreme Court in PRANAY SETHIs case (supra) Rs.40,000/- is awarded to the first claimant towards loss of consortium, Rs.15,000/- is awarded towards loss of estate and Rs.15,000/- is awarded towards funeral expenses. Hence, in all, the claimants are entitled to total compensation of Rs.7,97,454/- + Rs.40,000/- + Rs.15,000/- + Rs.15,000/- = Rs.8,67,454/-, which is rounded off to Rs.8,68,000/-.

SMT JUSTICE T. RAJANI   

MACMA.No.952 of 2013 

19-12-2017

J.Padma and others. APPELLANTS     

D.Satyanarayana and another... RESPONDENT   

Counsel for Appellants  : MR. P. RAMAKRISHNA REDDY     

Counsel for Respondents: --NONE APPEARED--   

<GIST   :

>HEAD NOTE:   

? Cases referred:
1.2013 ACJ 2512 
2.(2009) 6 SCC 121

SMT JUSTICE T. RAJANI   

MACMA.No.952 of 2013 

JUDGMENT:     

       This appeal is preferred by the appellants, who are the
claimants before the Court below, assailing the judgment of the
V Additional Metropolitan Magistrate Sessions Judge  cum  XIX
Additional Chief Judge, City Criminal Courts, Hyderabad in OP.No.717
of 2009 dated 22.12.2012 on the grounds that the Court below did not
award appropriate compensation and failed to see that the deceased in
the initial year itself has earned Rs.40,000/- per annum, as reflected in
Ex.A4, and his future income would have increased by 3 to 4 folds in
future.

2.      Heard the counsel for the appellants. None appears for the
respondents.

3.      The counsel for the appellants contends that apart from being a
toddy tapper, the deceased was working as LIC agent and the
evidence of P.W.3 would suffice to conclude that the deceased was
making very good earnings. The evidence of P.W.3 shows that he was 
working as a Branch Manager and that the deceased was issued agent  
licence on 03.03.2008 and he received Rs.40,517/- towards
commission for the business done during that period. The counsel for
the appellants contends that between March 2008 and November 2008   
itself the deceased could get the commission of Rs.40,517/-,
which would show that he would, in all probability, earn huge amounts
in future. The said fact glares from the evidence of P.W.3 and the
same cannot be ignored. 
4.      The Court below, however, considered the income of the
deceased as Rs.15,000/- but, ultimately, fixed the notional income of
Rs.4,000/-. There is absolutely no basis on which the Court below
arrived at the said amount. The evidence with regard to the deceased
taking up the avocation of toddy tapper apart from being LIC agent is,
however, not confidence inspiring. The deceased is stated to be a
graduate and hence, his avocation as LIC agent cant be believed but
his avocation as toddy tapper does not inspire any confidence, much
less, in the light of the fact that no cogent evidence was adduced to
prove the said fact. However, as already observed, the approach of the
Court below in not taking the annual income of Rs.40,000/-, as the
income of the deceased is not sustainable. In the first year itself,
the deceased could earn Rs.40,517/- and in the near future, he would
definitely earn more than the said amount, as the evidence of P.W.3
shows that the deceased had sufficient potential to make such
earnings.

5.      The counsel for the appellants also relied on a decision of the
High Court of Madras in PARAMESWARI v. A. KUMAR , which is   
rendered in respect of the death of LIC agent. The Court took the
commission as Rs.25,000/- per month and deducted 15% for income 
tax and 1/3rd towards personal expenditure. In this case, Rs.40,000/-
can be taken as the income of the deceased by ignoring the fraction of
Rs.517/-.

6.      The counsel also relied on a latest decision of the Supreme
Court in NATIONAL INSURANCE CO. LTD. v. PRANAY SETHI       
[Special Leave Petition (Civil) No.25590 of 2014 and batch dated 31.10.2017]
to contend that the future hike in the income is also to be considered
and the deceased, being 41 years, the future hike has to be 25% as
per the said decision.

7.      The income of Rs.40,517/- is only for a period of eight months
i.e. March 2008 to November 2008. Since the income of the deceased 
is stated to be only Rs.40,517/-, he would not be liable for tax, as the
income would not exceed taxable limits. If Rs.40,517/- is taken for
calculation of the income of the deceased, the monthly income would
come to Rs.40,517/- x 1/8 = Rs.5,064/- and the annual income would 
come to Rs.5,064/- x 12 = Rs.60,768/-. If the future hike at 25% is
added, the annual income would come to Rs.60,768/- + (Rs.60,768/- 
x 25% = Rs.15,192/-) = Rs.75,960/-. Since the claimants are four in
number, 1/4th has to be deducted towards his personal expenditure as
per the decision of the Supreme Court in SARLA VERMA v. DELHI   
TRANSPORT CORPORATION . Hence, after deducting 1/4th, the      
income would come to Rs.75,960/- - (Rs.75,960/- x  = Rs.18,990/-)
= Rs.56,961/-. The age of the deceased, being 41 years, the multiplier
relevant as per the decision of the Supreme Court in SARLA VERMAs  
case (2 supra) is 14. Hence, the loss of future income to the
claimants would come to Rs.56,961 x 14 = Rs.7,97,454/-. Apart from
the above, following the decision of the Supreme Court in PRANAY
SETHIs case (supra) Rs.40,000/- is awarded to the first claimant
towards loss of consortium, Rs.15,000/- is awarded towards loss of
estate and Rs.15,000/- is awarded towards funeral expenses.
Hence, in all, the claimants are entitled to total compensation of
Rs.7,97,454/- + Rs.40,000/- + Rs.15,000/- + Rs.15,000/- =
Rs.8,67,454/-, which is rounded off to Rs.8,68,000/-.

8.      Hence, the award of the Court below is modified as indicated
above with proportionate costs. The apportionment of compensation
shall be made in the same proportion as made by the Court below.
The award shall relate back to the date of decree and the
compensation awarded shall carry the interest at the rate and from the
date specified by the Court below.

        The civil miscellaneous appeal is allowed in part. As a sequel,
the miscellaneous applications, if any pending, shall stand closed.
__________ 
T. RAJANI, J
December 19, 2017

whether a counter-claim can be rejected in terms of Order VII, Rule 11 CPC, especially in the facts and circumstances of this case.= (i) Wherever the defence to a suit can survive even if the counter-claim goes, then the Court will be entitled to invoke Order VII, Rule 11 CPC and reject the counter-claim. (ii) Wherever the defence to the suit is so intertwined with the counter-claim that the rejection of the counter-claim will have the effect of killing the defence to the suit, the Court cannot invoke Order VII, Rule 11 CPC to reject the counter- claim.

HONBLE SRI JUSTICE V.RAMASUBRAMANIAN         

Second Appeal No.896 of 2017 

15-12-2017

Jinendra Jewellers, Rep. by its Proprietor Kushal Raj, S/o Seshmal Jain, Aged 46 years, D.No.27-14-59, Rajagopalachari Stree

1.B.Venkateswara Rao, S/o late B.V. Subba Rao, Aged 62 years, R/o D.No.27-14-59, Rajagopalachari Street, Vijayawada  2. B.Vi
Vijayawada Respondents/Plaintiffs

Counsel for Appellant:Mr V.S.R. Anjaneyulu

Counsel for Respondents:Mr. P.R. Prasad 

<Gist:

>Head Note:

? Cases referred:
   1. 2007 (2) ALD 483
   2. Manu/DE/0769/2014
   3. AIR 2003 MP 185


HONBLE SRI JUSTICE V.RAMASUBRAMANIAN         

Second Appeal No.896 of 2017 
Judgment:
      Aggrieved by the rejection of his counter-claim both by
the Trial Court and by the First Appellate Court, in terms of
Order VII, Rule 11 C.P.C., the defendant in a suit for recovery
of possession has come up with the above second appeal.
      2. Heard Mr. V.S.R. Anjaneyulu, learned counsel
appearing for the appellant and Mr. P.R. Prasad, learned
counsel appearing for the respondents.
      3. The respondents filed a suit in O.S.No.145 of 2016 on
the file of the II Additional Junior Civil Judge at Vijayawada,
praying for eviction of the appellant herein from the suit
schedule property and for future damages at the rate of
Rs.40,000/- per month. The case of the respondents/
plaintiffs in the suit was that the suit schedule shop was
taken on lease by the father of the appellant/defendant way
back in December, 2003; that subsequently the defendant
took over the shop from his father; that the defendant
committed default in payment of rent from April, 2015 and
that therefore after issuing a quit notice dated 23-12-2015,
the respondents/plaintiffs were constrained to file the suit for
eviction.
      4. The appellant/defendant filed a written statement
claiming that a lease agreement was entered into on
16-7-2005, in and by which, the lease was agreed to be
extended for a period of 25 years and that therefore he was
not liable to be evicted. In addition to setting up such
a defence, the appellant/defendant also made a counter-claim
by seeking a decree for the relief of specific performance
of the registration of the lease deed dated 16-7-2005.
The appellant/defendant admittedly valued the relief of
specific performance made in his counter-claim and also paid
Court Fee thereon.
      5. Thereafter, the respondents/plaintiffs appear to have
made a request to the Trial Court to reject the counter-claim
in terms of Order VII, Rule 11 CPC. Accordingly, the Court
below, by a judgment and decree dated 27-8-2016, rejected
the counter-claim alone.
      6. The said judgment and decree was taken on appeal in
A.S.No.222 of 2016 by the defendant, but the Appellate Court
dismissed the appeal. Hence, the defendant has come up with
the above second appeal.
      7. The one and only substantial question of law arising
for consideration in the above second appeal is  whether
a counter-claim can be rejected in terms of Order VII, Rule 11
CPC, especially in the facts and circumstances of this case.
      8. The power of the Court to reject a plaint cannot be in
doubt and the parameters are well set out in Order VII,
Rule 11 CPC. Order VIII, Rule 6-A(4) makes it clear that
a counter-claim shall be treated as a plaint and governed by
the rules applicable to plaints. Therefore, the applicability of
Order VII, Rule 11 CPC to counter-claims cannot be ruled out
in total. In fact, many High Courts have taken the view that
Order VII, Rule 11 CPC is applicable to counter-claims also.
This Court held so in Ananta Gas Suppliers v. Union Bank
of India . The High Court of Delhi took the same view in
Karan Madaan v. Nageshwar Pandey . In Mohan Lal v. 
Saukhi Lal  and the Madhya Pradesh High Court held
that a counter-claim can be rejected under Order VII,
Rule 11 CPC.
      9. But one question which none of the Courts seem to
have considered so far is as to the circumstances in which or
the conditions under which a counter-claim can be rejected
by applying the parameters of Order VII, Rule 11 CPC.
If a counter-claim can be dissected into two portions,
one comprising of the defence to the plaintiffs claim and
another comprising of the counter-claim and the survival of
one of which does not depend upon the other, it may be
possible to apply Order VII, Rule 11 CPC with surgical
precision. But where the defence to a suit and the counter-
claim are joined in such a manner as Siamese twins, with
inherent danger to the survival of the defence to the suit,
upon the rejection of the counter-claim under Order VII,
Rule 11 CPC, the Court would be doing something more than 
what a Court would normally do with respect to a plaint
under Order VII, Rule 11 CPC.
      10. It could be seen from Order VIII, Rule 6-A(1) CPC
that it entitles a plaintiff to set up by way of counter-claim,
any right or claim in respect of a cause of action accruing to
the defendant against the plaintiff either before or after the
filing of the suit but before the defendant has delivered his
defence or before the time limit for delivering his defence has
expired. This is irrespective of whether the counter-claim is in
the nature of a claim for damages or not. Under sub-rule (2)
of Rule 6-A of Order VIII CPC, the counter-claim is to have the
same effect as a cross suit so as to enable the Court to
pronounce a final judgment in the same suit both on the
original claim and on the counter-claim. Therefore, the
judgment and decree required to be delivered by the Court in
a case where there is a counter-claim, is to be in common for
both the claim and the counter-claim. In other words, there
will be only one judgment and one decree and not two
judgments and two decrees despite the fact that there are
virtually two suits, one in the form of a suit and another in
the form of a counter-claim.
      11. Sub-rule (4) of Rule 6-A of Order VIII CPC states
that the counter-claim shall be treated as a plaint and
governed by the rules applicable to plaints. But it does not
mean that it is no more a written statement. It is also
a written statement to which Order VIII CPC applies,
even while Order VII CPC is made applicable to a part of the
same.
      12. In fact, Rule 6-C of Order VIII CPC gives a right to
the plaintiff to seek an order to exclude the counter-claim on
the ground that the counter-claim ought not to be disposed of
except by way of an independent suit.
      13. Therefore, the counter-claim is not exactly the same
as a plaint, despite having the traits of a plaint, since the
same is raised in a written statement. The scheme of
Order VIII, Rules 6-A to 6-G CPC itself recognises the fact
that there could be two different scenarios, one where the
counter-claim could be inextricably intertwined with the
defence and another where it is capable of being prosecuted
as an independent suit (as provided in Order VIII,
Rule 6-C, CPC). 
      14. Therefore, in addition to the parameters provided in
Order VII, Rule 11 CPC, the Court may also have to examine
while dealing with a prayer for rejection of the counter-claim,
as to whether the rejection of the counter-claim would have
the effect of striking off the defence or rendering the
defendant defenceless.
      15. It must be remembered that at the stage of invoking
Order VII, Rule 11 CPC, the Court is not concerned with the
merits of the claim. But while dealing with a written
statement, the Court will certainly be considering the merits
of the claim.
      16. In the case on hand, the suit is one for eviction.
The defence raised by the defendant is that he is entitled to
have a lease deed executed and registered for a period of
25 years from 16-7-2005. The document accompanying the   
counter-claim appears to be an unstamped and unregistered 
document. If the counter-claim is taken up for trial, we do not
know whether the said document will be allowed to be
marked in evidence at all, in view of the recitals contained
therein and the document not being duly stamped and 
registered. We do not even know whether the defendant can 
actually secure a decree directing the plaintiffs to execute and
register a lease deed for a period of 25 years with effect from
16-7-2005, especially in the light of the limitations imposed
by the Registration Act, 1908 to the registerability of
a document executed several years ago. 
      17. But all the above are on the merits of the case. That
the counter-claim raised is so weak and eventually can only
be thrown out, may not be a ground to invoke Order VII,
Rule 11 CPC, especially when the defence to the suit, depends
for its survival upon the counter-claim.
      18. Therefore, the substantial question of law raised in
the above second appeal is answered to the following effect:
      (i) Wherever the defence to a suit can survive even if the
counter-claim goes, then the Court will be entitled to invoke
Order VII, Rule 11 CPC and reject the counter-claim.
      (ii) Wherever the defence to the suit is so intertwined
with the counter-claim that the rejection of the counter-claim
will have the effect of killing the defence to the suit, the Court
cannot invoke Order VII, Rule 11 CPC to reject the counter-
claim.
      19. In the light of the above answer to the substantial
question of law, the second appeal is allowed and the
judgments and decrees of both the Courts below are set aside.
The Court below may take up the trial of the suit and the
counter-claim together and examine all questions including
the admissibility of the document relied upon by the
appellant/defendant, the effect of its not being stamped and
registered etc., and dispose of the suit in accordance with
law. The miscellaneous petitions, if any, pending in this
second appeal shall stand closed. No costs.

___________________________   
V.RAMASUBRAMANIAN, J.     
15th December, 2017.

No -re-opened suo motu by the Presiding Officers= where the cases once posted for judgment are re-opened suo motu by the Presiding Officers thereby the decisions are getting delayed causing hardship to the parties and counsel. While deprecating the said practice, the High Court hereby directs all the Presiding Officers in the State not to resort to such practice, and pronounce judgments, at once, and only in exceptional circumstances the cases are to be reopened. = At the time of filing of the plaint, the trial Court should prepare complete schedule and fix dates for all the stages of the suit, right from filing of the written statement till pronouncement of the judgment and the courts should strictly adhere to the said dates and the said timetable as far as possible. If any interlocutory application is filed then the same be disposed of in between the said dates of hearings fixed in the said suit itself so that the date fixed for the main suit may not be disturbed. ; Court creates a needless suspicion in the minds of the parties= Once the trial is completed and the judgment is reserved, it is wholly undesirable to reopen the case by the Court suo motu. This is a very unhealthy practice, which, apart from giving scope for unscrupulous parties to indulge in vexatious litigation by filing needless applications, as in the present case, also gives rise to speculation, often putting the credibility of the Judge at stake. By resorting to such practice, the Court creates a needless suspicion in the minds of the parties and gives scope for avoidable rumour mongering. In my opinion, till the arguments of both sides in all respects are completed and the Court gets clarity on all aspects from the counsel for both sides, it shall not reserve the case for judgment. Once the judgment is reserved, it must avoid reopening of the case suo motu as far as possible, except in exceptional circumstances.

THE HONOURABLE SRI JUSTICE C.V. NAGARJUNA REDDY           

Civil Revision Petition No.3673 of 2017

03-11-2017


Bhamidimarri Vijaya Lakshmi  Petitioner

M.Uma Lakshmi Respondent   

Counsel for the petitioner: Mr. Muddu Vijai

Counsel for the Respondent :   -


<GIST:

>HEAD NOTE                                  :

? CITATION :1. (2011) 8 SCC 249

THE HONBLE SRI JUSTICE C.V. NAGARJUNA REDDY         

       
CIVIL REVISION PETITION NO.3673 OF 2017   


DATED:03-11-2017 


THE COURT MADE THE FOLLOWING:       

JUDGMENT: 

        This civil revision petition arises out of order
dt.21.06.2017 in I.A. No.10 of 2017 in O.S. No.1772 of 2011 on
the file of the I Additional Senior Civil Judge, Visakhapatnam.
2.      The petitioner filed the aforementioned suit for the
following reliefs:
        Therefore, the plaintiff humbly prays that the Honourable Court may
be pleased to pass a decree and judgment in her favour and against the
defendant for;
a)      To direct the defendant to vacate the schedule premises and deliver
vacant possession of the same to the plaintiff in good condition as
was given to the defendant;
b)      To direct the defendant to pay Rs.54,000/- (Rupees fifty four
thousand only) towards damages for unauthorized use and
occupation from January 2011 to September together with
subsequent interest @ 24% p.a. from the date of suit till
realization.
c)      To direct the defendant to pay future damages at the rate of
Rs.6,000/- per month from October 2011 till delivery of the
schedule property;
d)      For costs of the suit and
e)      Such other relief or reliefs as the Honourable court may deem fit and
proper under the circumstances of the case.

The petitioner has valued the suit for the purpose of court fee
and jurisdiction, as under:
                                        CF
        1) For eviction of the defendant, the suit is valued
              on the basis of 1 year Rental value,
             i.e., Rs.6,000/- x 12                                         : Rs.72,000-00
       
             Court fee is paid under Sec. 40 of the A.P.C.F.
             and S.V. Act


        2) For damages at the rate of Rs.6,000/-
             per month from January 2011 to
            September 2011
          Rs.6,000 x 9 months                                        : Rs.54,000-00
        Court fee is paid under section 20
        Art 1 (b) & (c) of Sch.I of A.P.C.F. and S.V. Act.

3.      After the case was reserved for judgment, and was
subsequently reopened suo motu on the second occasion, the 
petitioner filed I.A. No.10 of 2017 under Order VI Rule 17 of
the Code of Civil Procedure, 1908 (CPC) for permission to
carry out amendments to paragraphs V and VI of the plaint, as
under:
Para No.V Amendemnts. 
V.      Value of the suit for the purpose of Court fee and jurisdiction is
Rs.10,60,500/- and a Court fee of Rs.14,992/- is paid thereon under Section
29 and 20 read with Article 1(b) and (c) of the A.P.C.F. & S.V. Act, 1956.
DETAILS OF VALUATION   
                                                                  Value        Court Fee
(1) Value of the relief of Ejection

      Market Value of the suit schedule
      Property Flat No.1 in Ground Floor
      D.No.4-47-2/1 with a plinth area of
     930 Sft., Sft. Cost Rs.1500/- per Sft.     14,25,000
    3/4th thereof                                        10,06,500        12,526-00
(2) Damages                                               54,000           2,466-00
                                                    ----------------     ---------------
                            TOTAL                10,60,500         14,992-00
                                                      ------------------      -------------------
Earlier the petitioner paid C.F. of Rs.5332/- the balance CF of Rs.9,660/-
will be paid after allowing of this Application.


Para No.VI Amendments 
VI.     The plaintiff therefore prays for a decree against the defendants for

a)      Ejection of the Defendant and their men with all their bag and baggage
from the suit schedule Flat and deliver vacant possession of the same to
the Plaintiff.
b)      Payment of Damages of Rs.54,000/- 
c)      Payment of Mesne profits by the Defendant from the date of their
highhanded and unauthorized occupation, either to be ascertained by this
Honourable Court in the suit or by appointment of an Advocate
Commissioner. 
d)      Cost of this suit; and
e)      Such other and further relief or reliefs as your Honourable Court may
deem fit, proper and necessary in the circumstances of the case.

4.      The respondent filed a counter affidavit wherein she has
denied the ownership of the petitioner by taking the plea that
the suit schedule property was purchased by her father-in-law,
who is the husband of the petitioner, and kept ostensibly in the
latters name.  It was further averred that though the said stand
was clearly taken in the written statement, no steps were taken
for amendment of the plaint till the trial was completed and
that in the absence of any plea that in spite of due diligence the
amendment could not be sought prior to the commencement of 
the trial, the application is liable to be dismissed as per the
proviso to Order VI Rule 17 of CPC.  A further plea was taken
that the application for the amendment filed beyond three years
from the date of filing of the suit is barred by limitation and
that the proposed amendment changes the entire character of
the suit.  By order dt.21.06.2017, the lower Court has dismissed
the I.A.
5.      During the hearing of the revision petition, this Court
noticed the contents of paragraph -7 of the order under
revision wherein it is stated that after completion of trial, the
case was reserved for judgment on 26.09.2016, that later it was
adjourned from time to time and again reopened on number of
occasions and that thereafter the petitioner filed I.A. No.10 of
2017 on 23.12.2016.  This Court therefore called for the docket
proceedings in order to know the reasons for reopening of the
suit.  The docket proceedings have been accordingly sent.  As
this Court was unable to decipher the extremely unclear docket
entries made in manuscript, the lower Court was directed to get
the same typed.  Accordingly, typed docket proceedings have
been forwarded by the lower Court.  Before dealing with this
aspect, I would like to first consider the revision on merits.
6.      A perusal of the order of the lower Court would reveal
that it has dismissed the I.A. on three grounds, namely, 1) that
the proposed amendment changes the character of the suit,
2) that the application for amendment having been filed six
years after filing of the suit and after completion of the trial, the
petitioner is not entitled to seek amendment having regard to
the provisions of Order VI Rule 17 of CPC, and 3) that the
petitioner has not assigned any reason in support of the
application for amendment.
7.      On a comparison of the original prayer and the proposed
prayer, I do not find any substantial difference as regards the
main prayer, namely, recovery of possession, in their content,
though there is a slight variation in form.  Under paragraph VI
(a) of the original prayer, the petitioner sought for a direction to
the respondent to vacate the schedule premises and deliver
vacant possession to her in good condition, while the proposed
prayer under paragraph VI(a) is for ejection of the respondent
and their men with all their bag and baggage from the suit
schedule flat and deliver vacant possession of the same.  Prayer
(b) remained the same. Under prayer (c), the petitioner
originally sought a direction to the defendant to pay future
damages at the rate of Rs.6,000/- per month from October
2011 till delivery of the schedule property, whereas under the
proposed amendment, prayer mesne profits for unauthorized 
occupation is sought.  Unfortunately, the lower Court has
straight away accepted the ipse dixit  of the respondent and
jumped to the conclusion that the proposed amendment  
changes the whole character of the suit.         The lower Court has
not discussed as to how the character of the suit will change if
the proposed amendment is accepted. 
8.      Be that as it may, the point that needs to be considered is
whether the petitioner is entitled for amendment of the plaint.
Under Order VI Rule 17 CPC, the Court may at any stage of the
proceedings allow either party to alter or amend his pleadings in
such manner and on such terms as may be just, and all such 
amendments shall be made as may be necessary for the purpose   
of determining the real questions in controversy between the
parties.  The proviso to the said Rule, however, bars such
amendment after the trial has commenced, unless the Court 
comes to the conclusion that in spite of due diligence, the party
could not have raised the matter before the commencement of 
the trial.  Under this provision, a party seeking amendment has
to necessarily satisfy two requirements, namely, (i) that the
proposed amendment is necessary for the purpose of 
determining the real question in controversy between the
parties and, (ii) if the trial has been commenced the party must
satisfy the Court that in spite of his exercising due diligence he
could not file an application for amendment before the
commencement of the trial.  The affidavit filed in support of
I.A. No.10 of 2017 is silent on both the aforementioned
aspects.  It is not explained therein as to how the proposed
amendment is necessary for determining the real questions in
controversy.
9.      As regards the exercise of due diligence, all that the
petitioner has stated in her affidavit is that originally, the suit
was entrusted to a Senior Counsel and thereafter to one Mr. P.
Ravi Kiran, that her counsel was elevated to a Judicial Post and
that therefore she has entrusted the case to the present counsel.
That at the time of institution of the suit, her counsel calculated
the court fee under Section 40 of the A.P. Court Fees and Suits
Valuation Act, 1956, instead of calculating the same under
Section 29 and 20 of the said Act and that she was unaware of
the legal proceedings and not conversant with the said Act and
therefore she could not pay the court fee as per the Act in force
in the State of Andhra Pradesh.  She has further stated that at
the time of presenting the written arguments his counsel
observed the said mistake and filed the application.  The
affidavit did not explain the necessity of seeking amendment of
the prayer in paragraph VI.  As observed hereinbefore, except
the form, the substance of paragraph VI of the proposed
amendment is identical to that of the original prayer.
Therefore, I do not find any need whatsoever for the proposed
amendment.  
10.     As for the valuation shown under paragraph V, the relief
of eviction was valued on the basis of rental value for one year,
while under the proposed amendment it was valued based on  
the market value.  For seeking the amendment of relief of court
fee, there is no whisper that despite exercise of due diligence
the purported mistake was not detected.  On the contrary, the
docket proceedings show that on 4.8.2016 written arguments
were filed on behalf of the petitioner and on 9.8.2016 written
arguments were filed on behalf of the respondent.  Reply
arguments were filed on 6.9.2016, hearing was completed on
that day and the suit was posted for judgment on 26.09.2016.
Later, the case was adjourned to 30.09.2016, 14.10.2016,
28.10.2016, 28.10.2016 and 4.11.2016, on which date it was suo
motu reopened and adjourned to 17.11.2016 for judgment.
Again on 17.11.2016 the case was suo motu reopened for hearing
and adjourned to 24.11.2016 for hearing.  On 24.11.2016 and
on 1.12.2016 the case was adjourned at request and on
14.12.2016 it was adjourned at the request of the counsel for
the petitioner.  It is only on 23.12.2016 that the petitioner has
filed the aforementioned I.A. These facts would show that but
for the reopening of the suit for the second time, the petitioner
would not have had an opportunity of filing the application for
amendment.  Apart from the fact that the pleading regarding
the due diligence is totally absent, even the conduct of the
petitioner does not show that she has exercised due diligence in
filing the application for amendment.  Therefore, I have no
hesitation to hold that the petitioner has failed to satisfy the
twin requirements of Order VI Rule 17 of CPC as indicated
above.  Though the lower Court has failed to assign sound
reasons for dismissing the I.A., the conclusion arrived at by it
and the result of the case, are nevertheless required to be
upheld, albeit on the strength of my own reasons as assigned
hereinbefore.
11.     Before closing this case, it is necessary to observe that
though the trial was effectively commenced on 27.1.2015 with
the presence of P.W.1 in the Court, it took eighteen months for
the Court to complete the trial.  Even after the trial was closed
and judgment was reserved on 6.9.2016, it was not delivered on
five occasions on which the case was posted.   On 4.11.2016
the case was suo motu reopened and no reasons were assigned 
therefor.  The docket entry discloses that on the said date, the
case was again heard and adjourned to 17.11.2016 for
judgment.  On the said date, again the case was suo motu
reopened and adjourned to 24.11.2016.  The lower Court has
failed to assign any reason for reopening the case suo motu for
the second time also.  This laxity on the part of the Court in
delivering the judgment has given the scope for the petitioner to
come out with an application for amendment as a result of
which, the suit has been kept pending.
11.     The manner in which the Court below has handled the
case does not appear to be confined or peculiar to one
particular Court.  The practice of reserving the cases for
judgment and reopening the same suo motu again and again 
appears to be prevalent in many Courts in both the States.  To
my mind, this is due to the failure of the Courts to make a
proper planning of posting and disposal of cases.  In this
context, two pivotal provisions in the A.P. Civil Rules of
Practice and Circular Orders, 1980 (hereinafter referred to as
the Rules) need to be referred to and discussed.  They are
Rules 66 and 101.
12.     Rule 66 of the Rules, which deals with preparation and
publication of Special list, reads as under:
        66. Preparation and publication of Special list:-
(1)     On completion of the preliminary stages of suit or other matter,
the court shall obtain the required information from the
Advocates or parties to enable it to estimate the probable length of
the hearing and then post in the hearing book to particular dates.
(2)     When the cases so posted are called on the dates, the Advocates or
the parties shall report whether there is any case of compromise or
death of parties and the like.  Then a list known as the Special
List of ready cases shall be prepared at the beginning of every
month.  For each day of the following month, postings shall be
made with sufficient number of contested suits, uncontested suits
and other matters that can be expected to be heard in a day. This
Special List shall be published on the notice board of the court
by the fifth day of each month.  Between the fifth day and the
tenth day any representation which the Advocates or the parties
might have to make may be heard and necessary changes be 
made.
(3)     The final list for whole of the next month shall be published by
the tenth of each month and thereafter, short of the death of
parties or similar compelling reasons, no adjournments be
granted.

Rule 101 of the Rules, with the heading Application for
directions is as follows:
101.   Application for directions:-
        Any party may, at the first hearing, apply to the Court for directions or
the court may, suo motu issue directions as to any of the following matters:

(1)     The filing of a written statement by any party, stating the pleas
raised by him or further and better particulars thereof;
(2)     Adding or striking out parties;
(3)     Discovery of documents and interrogatories;
(4)     Inspection or production of any document or public record;
(5)     Issue of a commission to examine witnesses, or for any other
purpose;
(6)     Reference to an arbitrator;
(7)     Any other matter or proceeding necessary to be considered or
taken prior to the trial of the suit.

     Unless the court otherwise orders, not less than three days notice of such
application and of any affidavit filed in support thereof, shall be given by the
applicant to the other parties to the suit.

The above reproduced Rules embody the principle of Case
Management.  If strict adherence to these Rules is made, the
Court can plan the disposal of cases in a time bound manner by
avoiding needless adjournments.  The Court can also prevent
the spate of belated applications filed for reliefs, such as,
reference of disputed documents to experts for their opinion,
appointment of Advocates Commissioner for local inspections
etc., which are causing enormous delays in disposal of the suits.
Unfortunately, it does not appear that these two Rules are being
followed by any Court.
13.     In Rameshwari Devi v. Nirmala Devi , the Supreme
Court suggested various measures for curbing delays in civil
litigation.  Some of the important measures suggested by it in
paragraph 52 of the judgment are:
        A. Pleadings are the foundation of the claims of parties.  Civil
litigation is largely based on documents.  It is the bounden duty and obligation
of the trial Judge to carefully scrutinize, check and verify the pleadings and the
documents filed by the parties.  This must be done immediately after civil suits
are filed.
        B. The court should resort to discovery and production of documents and
interrogatories at the earliest according to the object of the Act.  If this exercise is
carefully carried out, it would focus the controversies involved in the case and
help the court in arriving at the truth of the matter and doing substantial justice.
             
        J. At the time of filing of the plaint, the trial Court should prepare
complete schedule and fix dates for all the stages of the suit, right from filing of
the written statement till pronouncement of the judgment and the courts should
strictly adhere to the said dates and the said timetable as far as possible.  If any
interlocutory application is filed then the same be disposed of in between the said
dates of hearings fixed in the said suit itself so that the date fixed for the main
suit may not be disturbed.

The directions in B and J in the judgment in Rameshwari
Devi (1 supra) constitute the essence of Rules 66 and 101 of the
Rules.  While these Rules remain dead letters, the directions of
the Apex Court in Rameshwari Devi (1 supra) appear to be
followed more in breach.
14.     As regards the time frame for delivery of judgments,
Section 33 of the Code of Civil Procedure ordains that the
Court, after the case has been heard, shall pronounce the
judgment.  Rule 142 of the Rules, reads as under:
142.   Time for delivery of judgment:-
(1)     The Court, after case has been heard, shall pronounce judgment
in an open Court, either at once, or as soon thereafter as may be
practicable and when judgment is to be pronounced on some  
future day, and such day shall be within thirty days and it shall
not ordinarily be a day beyond sixty days from the date on which
the hearing of the case was concluded the Court shall fix a day for
that purpose, of which due notice shall be given to the parties or
their pleaders.
(2)     The fair copy of the judgment required for the record in Court
shall be prepared within five days of the date on which judgment
is pronounced.

Under the above reproduced rule, after the case has been
heard, the Court shall pronounce judgment in open Court either
at once or as soon thereafter as may be practicable. If the
judgment is to be pronounced on a future day, the same shall be
done within thirty days and shall not ordinarily be a day beyond
sixty days from the date on which the hearing of the case was
concluded.  Being alive to the reality that the above Rule is
invariably breached, this Court has issued Circular in ROC
No.4001/OP CELL-E/2004, dt.30.8.2004, which reads as 
follows.
        Certain instances have come to the notice of the High Court where the
cases once posted for judgment are re-opened suo motu by the Presiding Officers
thereby the decisions are getting delayed causing hardship to the parties and
counsel.

        While deprecating the said practice, the High Court hereby directs all the
Presiding Officers in the State not to resort to such practice, and pronounce
judgments, at once, and only in exceptional circumstances the cases are to be
reopened. 

        In order to monitor the said issue at High Court level, all the Unit Heads
are requested to furnish the consolidated data in the given proforma, relating to the
cases that were re-opened together with the reasons, in brief, every month.

PROFORMA   

SL.
NO
NAME 
OF THE 
COURT 
CASE 
NO.
DATE ON 
WHICH 
HEARING 
WAS 
CLOSED 
DATE TO 
WHICH 
JUDGMENT   
IS POSTED 
DATE 
ON
WHICH 
THE
CASE IS 
RE-
OPENED 
DATE ON 
WHICH 
JUDGMENT   
PRONOUCNE   
D
REASONS   
IN BRIEF


The High Court issued another Circular vide ROC.
No.1708/2011-Vigilance Cell, dt.03.01.2012, reiterating the
earlier Circular and directing all the Presiding Officers in the
State to desist from the practice of reopening of matters which
are reserved for judgment and that only in exceptional
circumstances and for reasons to be recorded in writing, such
cases may be reopened by giving advance notice to the
concerned advocates, who are representing the parties.  This
was reiterated by another letter of the Registrar (Vigilance) vide
Roc.Lr. No.1997/2011-Vigilance Cell, dt.02.04.2012.  The said
Circulars and the letter notwithstanding, instances galore where
the officers have been reserving the judgments and reopening
the cases suo motu again and again.
15.     Once the trial is completed and the judgment is reserved,
it is wholly undesirable to reopen the case by the Court suo motu.
This is a very unhealthy practice, which, apart from giving
scope for unscrupulous parties to indulge in vexatious litigation
by filing needless applications, as in the present case, also gives
rise to speculation, often putting the credibility of the Judge at
stake.  By resorting to such practice, the Court creates a
needless suspicion in the minds of the parties and gives scope
for avoidable rumour mongering.  In my opinion, till the
arguments of both sides in all respects are completed and the
Court gets clarity on all aspects from the counsel for both sides,
it shall not reserve the case for judgment.  Once the judgment is
reserved, it must avoid reopening of the case suo motu as far as
possible, except in exceptional circumstances.  Even in such
cases it cannot reopen the case without assigning proper
reasons and without notice to both the parties.  In all such
events, the Court concerned must forthwith send the
information to the unit heads who in turn must furnish
consolidated data in the proforma, as per the Circular in ROC.
No.4001/OP CELL-E/2004, dt.30.08.2004.   
16.     The High Court on administrative side may ensure that
Section 33 of CPC read with Rule 142, and Rules 66 and 101 of
the A.P. Civil Rules of Practice and Circular Orders are
scrupulously followed by issuing appropriate Circular(s).
17.     Subject to the above observations, the civil revision
petition is dismissed.
        As a sequel to dismissal of the civil revision petition,
C.R.P.M.P. No.4809 of 2017 shall stand disposed of as
infructuous.
__________________________   
C.V. NAGARJUNA REDDY, J     
03-11-2017