Allowed

Achanta Rama Chandra Rao v. The State of Andhra Pradesh

Andhra Pradesh HC12 Aug 2024CRLP/4332/2018

Case brief

AI extract

What is this about?

Office-bearers and employees of a co-operative society sought quashing of proceedings for criminal breach of trust under Section 409 IPC. Holding they are not 'public servants' under Section 21 IPC, the court quashed the proceedings against surviving accused; the petition abated for deceased petitioners.

What did the court decide?

Proceedings against petitioners/Accused Nos.2, 3 and 7 in C.C.No.178/2016 quashed; petition regarding petitioners 1 and 5 dismissed as abated.

Achanta Rama Chandra Rao Vs The State of Andhra… — Cooperative Societies | Andhra Pradesh HC (2024)

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IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI

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TUESDAY, THE THIRTEENTH DAY OF AUGUST TWO THOUSAND AND TWENTY FOUR

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PRESENT

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THE HONOURABLE SMT JUSTICE V.SUJATHA

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CRIMINAL PETITION NO: 4332 OF 2Q1fi

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Between:

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Achanta Rama Chandra Rao (A1), S/o. Bapanaiah aged about 56 years, R/o. Rallakunta Village, Dwaraka Tirumala Mandal, Ex-President of Sri Venkateswara Large Scale Co-Operative Society Ltd.,

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Nallanti Chakravarthi Venu Gopala Charyulu (A2) S/o. Tirumala Charyulu, aged about 61 years, R/o Dwaraka Tirumala Village,

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Dwaraka Tirumala Mandal, Former Secretary of Sri Venkateswara Large Scale Co-Operative Society Ltd.

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Mogalapu Raja Sekhar (A3), S/o. Ratna Koteswara Rao aged about 46 years, R/o Sattenagudem Village, Dwaraka Tirumala Mandal Former casher of Sri Venkateswara Large Scale Co-Operative Society Ltd.

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Gutta Venkata Siva Rama Krishna Benarji (A7), S/o. BalaramaMurthy, aged about 54 years, R/o Timmapuram Village, Dwaraka Tirumala Mandal, Salesman in Sri Venkateswara Large Scale, Co-Operative Society Ltd.

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Parimi Kutumba Rama Subrahmanyam {A9), S/o. Rama Mohana Rao, aged about 50 years, R/o. Dwaraka Tirumala Village, Dwaraka Tirumala Mandal, Accountant in Sri Venkateswara Large Scale Co-Operative Society Ltd.

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...Petitioners/Accused

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AND

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The State of Andhra Pradesh, Rep. by its Public Prosecutor, High Court of Judicature for the State of Telangana and the State of A.P., Hyderabad

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The Divisional Co-operative Officer, Eluru, West Godavari District.

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...Respondent/Complainant

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Petition under Section 482 of Cr.P.C praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition, the High Court may be pleased to call for the records in connection with the CC.No.178/2016 on the file of the Hon’ble Judicial First Class Magistrate, Bhimadole, West Godavari District.

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I.A. NO: 1 OF 2018

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Petition under Section 482 of Cr.P.C praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition the High Court may be pleased to grant stay of all further proceedings in CC.No.178/2016 on the file of the Hon’ble Judicial First Class Magistrate Bhimadole, West Godavari District, pending disposal of the above Criminal Petition.

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This Petition coming on for hearing, upon perusing^{theMemorandum} of Grounds of Criminal Petition and upon hearing the arguments of Sri Y Sudhakar, Advocate for the Petitioner and the Public Prosecutor on behalf of the Respondent No.1 and none appeared for the Respondent^No.2

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The Court made the following: ORDER

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APHC010280462018

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IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI

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[3333]

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(Special Original Jurisdiction)

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TUESDAY. THE THIRTEENTH DAY OF AUGUST TWO THOUSAND AND TWENTY FOUR

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PRESENT

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THE HONOURABLE SMT JUSTICE V.SUJATHA

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CRIMINAL PETITION NO: 4332/2018

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Between:

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Achanta Rama Chandra Rao and others

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...PETITIONER/ACCUSED{S)

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AND

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The State of Andhra Pradesh and others

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...RESPONDENT/COMPLAINANT{S)

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Counsel for the Petitloner/accused(S):

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1.YSUDHAKAR

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Counsel for the Respondent/complalnant(S):

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PUBLIC PROSECUTOR (AP)

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The Court made the following:

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ORDER

This Criminal Petition is filed by the petitioners/accused^Nos.1,2,3,7 and 9 seeking to quash the proceedings against them^{inC.C.No.178of2016} on the file of the Judicial First Class Magistrate, Bhimadole,^WestGodavari District.

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The subject C.C. arises out of Crime No.118 of 2014^onthe file of Dwaraka Tirumala Police Station, registered for the^{offenceunderSection409} r/w 34 IPC, on the basis of a complaint lodged by the Divisional Co-operative Officer, Eluru, alleging commission of the offence^{ofcriminalbreachoftrustby} the accused by misappropriating the funds of Sri Venkateswara^LargeSize Co-operative Society Ltd., Dwaraka Tirumala. Accused^No.1 is the member of Sri Venkateswara Large Size Co-operative Society Ltd.,^{DwarakaTirumala,} and in the year 1995, he was elected as President of^theSociety. It was alleged that during the period from 02.11.2005 to 29.04.2009,^accusedNo.1, along with accused Nos.2 to 10, who are Secretary and^{otheremployeesof} the Society, indulged in some financial irregularities.^{Uponnoticingthealleged} irregularities, the Joint Registrar/District Cooperative^{Officer,WestGodavari} District, appointed the Assistant Registrar, Sub-Divisional^{CooperativeOfficer,} Chintalapudi, as an Enquiry Officer to conduct enquiry into the financial irregularities alleged to have been committed by accused^Nos.1 to 10 during the period from 02.11.2005 to 29.04.2009. The Enquiry Officer, having conducted the enquiry and having verified the available^{recordsoftheSociety,} opined that accused Nos.1 to 10 are involved in a major^{funddiversioninthe}

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day-to-day functioning of the Society and committed financial irregularities and accordingly, the Enquiry Officer submitted his report to the Joint Registrar/District Co-operative Officer, West Godavari District. Thereupon, the Divisional Co-operative Officer, Eluru, who is^{thedefacto-complainant} herein, lodged a written complaint in Dwaraka Tirumala Police Station for registration of criminal case against the accused.^{Onthebasisthereof,acase} in Cr.No.118 of 2014 for the offence under Section^{409r/w34IPOhasbeen} registered on the file of Dwaraka Tirumala Police Station^{on13.08.2014and} investigated into. After completion of investigation,^thepolice filed charge sheet against accused Nos.1 to 10 for the offence under^{Section409r/w34} IPC.

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Learned counsel for the petitioners submits that the petitioners cannot be considered to be ‘public servants' under Section²¹ of IPC and when it is established that the petitioners are not 'public servants'^{underSection21} of IPC, the charge under Section 409 IPC is not maintainable^againstthem. In support of his contention, learned counsel relies on^{thedecisionoftheHon’ble} Supreme Court in State of Maharashtra v. Laijit Rajshi^{Shah^andalsothe} decision of this Court in D.Venkata Rao and Another v. State rep., by S.l of Police, Pentapadu PS, West Godavari District and also^{theorderdated} 30.04.2024 passed in W.P.Nos.3502 & 3974 of 2016.

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'■ 2000 (2) Supreme Court Cases 699 ^ 2000(4) Crimes 365

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During the course of hearing, learned counsel for the petitioners brought to the notice of this Court that petitioners No.1 and 5 died during pendency of the criminal petition.

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Learned Assistant Public Prosecutor appearing for the respondents contended that the alleged acts of the petitioners^are sufficient to conclude that the petitioners have committed offence punishable^{underSection409r/w} 34 IPC and requested to dismiss the petition.

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Having heard the submissions made by the learned counsel representing both parties and on perusal of the material^{availableonrecord} the point that arises for consideration is as follows:

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‘‘Whether the proceedings against the petitioners in^C.CNo.178 of 2016 on the fiie of the Court of Judiciai First Ciass Magistrate, Bhimadole are liable to be quashed by exercising jurisdiction^under Section 482 of Cr.P.C.?’’

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The present petition has been filed under Section 482^ofCr.P.C.

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Section 482 of Cr.P.C. saves the inherent powers of the High Court to make such orders as may be necessary to give effect to any order under the Code or to prevent abuse of the process of any Court^{orotherwisetosecure} the ends of justice. It is an obvious proposition that when a Court has authority to make an order, it must have also power to carry^{thatorderintoeffect.} If an order can lawfully be made, it must be carried out; otherwise it would be useless to make it. The authority of the Court exists^{fortheadvancementof} justice, and if any attempt is made to abuse that authority so as to produce

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injustice, the Court must have power to prevent that^{abuse.Intheabsenceof} such power the administration of law would fail to serve the purpose for which alone the Court exists, namely to promote justice and to prevent injustice. Section 482 of Cr.P.C confers no new powers but merely safeguards existing powers possessed by the High Court. Such power has to be exercised sparingly in exceptional cases and this power is external^{innaturetomeetthe} ends of justice.

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Time and again, the scope of powers of this Court under^Section482of Cr.P.C. was highlighted by the Apex Court in long line of perspective pronouncements, which are as follows:

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In “R.P. Kapur v. State of Punjab^”, the Apex Court laid down the following principles:

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(i) Where institution/continuance of criminal proceedings against an accused may amount to the abuse of the process of the court or that the quashing of the impugned proceedings would secure the ends of justice;

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(ii) where it manifestly appears that there is a legal bar against the institution or continuance of the said proceeding, e.g. want of sanction;

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(iii) where the allegations in the First Information Report or the complaint taken at their face value and accepted in their entirety,^{donotconstitutethe} offence alleged; and

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(iv) where the allegations constitute an offence alleged^{butthereiseitherno} legal evidence adduced or evidence adduced clearly or manifestly fails to prove the charge.

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Section 482 of the Code of Criminal Procedure empowers the High Court to exercise its inherent power to prevent abuse of the process of Court.

^ AIR I960 SC 866

In proceedings instituted on complaint exercise of the inherent power to quash the proceedings is called for only in cases where the complaint does not disclose any offence or is frivolous, vexatious or oppressive. If the allegations set out in the complaint do not constitute the offence of which cognizance is taken by the Magistrate it is open to the High Court to quash the same in exercise of the inherent powers under Section 482. It is not, however, necessary that there should be a meticulous analysis of the case, before the trial to find out whether the case would end in conviction or not. The complaint has to be read as a whole. If it appears on a consideration of the allegations, in the light of the statement on oath of the complainant that ingredients of the offence/offences are disclosed, and there is no material to show that the complaint is mala fide, frivolous or vexatious. In that event there would be no justification for interference by the High Court as held by the Apex Court in “Mrs. Dhanalakshmi v. R. Prasanna Kumar^"

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In “State of Haryana v. Bhajan Laf”', the Apex Court^considered in detail the powers of High Court under Section 482 Cr.P.C. and the power of the High Court to quash criminal proceedings or FIR. The Apex Court summarized the legal position by laying down the following guidelines to be followed by High Courts in exercise of their inherent powers to quash a criminal complaint:

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(1) 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 jfie accused. "air 1990 SC 494 ® 1992 Supp(1)SCC 335

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(2) Where the allegations in the first information^{reportandothermaterials,} if any, accompanying the FIR do not disclose a cognizable offence, justifying an investigation by police officers under Section 156(1)^{oftheCodeexceptunderan} order of a Magistrate within the purview of Section^{155(2)oftheCode.} (3) Where the allegations made in the FIR or complaint^{andtheevidence} collected in support of the same do not disclose the^{commissionofanyoffenceand} make out a case against the accused.

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(4) Where, the allegations in the FIR do not constitute^{acognizableoffence} but constitute only a non- cognizable offence, no investigation^{ispermittedbyapolice} officer without an order of a Magistrate as contemplated^{underSection155(2)ofthe} Code.

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(5) Where the allegations made in the FIR or complaint^{aresoabsurdand} inherently improbable on the basis of which no prudent^{personcaneverreachajust} conclusion that there is sufficient ground for proceeding^againstthe accused.

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(6) Where there is an express legal bar engrafted in^{anyoftheprovisionsof} the Code or the concerned Act (under which a criminal^{proceedingisinstituted)tothe} institution and continuance of the proceedings and/or^where there is a specific provision in the Code or the concerned Act, providing^{efficaciousredressforthe} grievance of the aggrieved party. (7) Where a criminal proceeding is manifestly attended^{withmalafideand/or} where the proceeding is maliciously instituted with^an ulterior motive for wreaking vengeance on the accused and with a view to spite him^{duetoprivateandpersonal} grudge.

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Keeping in view the above principles, 1 would like^{toexaminethecase}

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on hand.

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For better appreciation, Section 409 I.P.C., extracted^hereunder:

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Criminal breach of trust by public servant, or by banker, merchant or agent;

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Whoever, being in any manner entrusted with property,^orwithany dominion over property in his capacity of a public^{servantorinthewayofhis} business as a banker, mer-chant, factor, broker, attorney or agent, commits criminal breach of trust in respect of that property,^{shallbepunishedwith} imprisonment for life, or with imprisonment of either^{descriptionforaterm} which may extend to ten years, and shall also be liable^tofine.

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The primary contention of the learned counsel for the^{petitionersisthat} the petitioners do not come within the definition of^{'publicservant'asper}

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Section 21 of I.P.C. and, therefore, the criminal proceedings initiated against them for the offence under Section 409 I.P.C. are unsustainable.

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While dealing with similar issue, the Hon’ble Apex Court, in State of Maharashtra v. Laijit Rajshi Shah{^ supra), held as^follows:

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"6. In view of the rival submission at the Bar, the sole question that arises for consideration is, as to what is the effect of the provisions of Section 161 of the Maharashtra Cooperative Societies Act in interpreting the provisions of Section 21 of the Indian Penal Code. It is undoubtediy true that the Cooperative Societies Act has been enacted by the State Legislature and their powers to make such legislation is derived from Entry 32 of List II of the Seventh Schedule to the Constitution. The legislature no doubt in Section 161 has referred to the provisions of Section 21 of the Indian Penal Code but such reference would not make the officers concerned “public servants" within the ambit of Section 21. The State Legislature had the powers to amend Section 21 of the Indian Penal Code, the same being referable to a legislation under Entry I of List III of the Seventh Schedule, subject to Article 254(2) of the Constitution as, otherwise, inclusion of the persons who are 'pubiic servants' under Section 161 of the Cooperative Societies Act would be repugnant to the definition of 'pubiic servant' under Section 21 of the Indian Penal Code. That not having been done, it is difficult to accept the contention of the learned counsel appearing for the State that by virtue of deeming definition in Section 161 of the Cooperative Societies Act by reference to Section 21 of the Indian Penal Code, the persons concerned could be prosecuted for the offences under the Indian Penal Code..."

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...The Co-operative Societies Act is a completeiy seif-contained Statute with its own provisions and has created specific offences quite different from the offences in the Indian Penal Code. Both statutes have different objects and created offences with separate ingredients. They cannot thus be taken to be statutes in pari materia so as to form one system. This being the position, even though the legislatures had incorporated the provisions of Section 21 of the Indian Penal Code into the Co operative Societies Act, in order to define a “public servant” but those “public servants” cannot be prosecuted for having committed the offence under the Indian Penal Code...”

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Thus, it has been categorically held by the Hon’ble Apex Court that though Section 161 of the Maharashtra Cooperative Societies Act has referred to the provisions of Section 21 of the I.P.C., but such reference would not make the officers concerned “public servants” within the ambit of Section 21 of I.P.C.

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In D.Venkata Rao and another v. State rep., by S.l of Police, Pentapadu PS, West Godavari District (2 supra), this Court while

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considering the question as to whether the petitioners^{therein,whowere} President and Secretary of a society registered under the provisions of A.P. Cooperative Societies Act, can be brought within the^definition of ‘public servant’ as enjoined in Section 21 of the Indian Penal^{Code,thisCourt,having} referred to the decision of the Hon’ble Apex Court in Laijit Rajshi Shah (1 supra), held as follows:

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“The provisions of Section 129-Aof the Act are akin to the provisions under Section 160 of the Maharashtra Cooperative Societies^Act. In view of the authoritative pronouncement of the Apex Court, the revision petitioners cannot be considered to be the 'public servants' under^{Section21ofIndian} Penal Code when once it is established that they are not 'public servants' under Section 21 of Indian Penal Code. The charge under^{Section409Indian} Penal Code should fail. ”

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Having held so, this Court set aside the conviction^{andsentence passed} against the petitioners therein for the offence under^{Section409I.P.C.}

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In similar circumstances, following the ratio laid down in LaIJit Rajshi Shah (1 supra) and also the earlier decision of this^{CourtinD.VenkataRao(2} supra), this Court, vide common order dated 30.04.2024 passed in W.P.Nos.3502 and 3974 of 2016, has quashed the F.I.R. registered against the petitioners therein, who were President and Secretary of a Primary Agricultural Cooperative Society, for the offence under^{Section409readwith} 34 I.P.C., on the ground that they do not come under^{thedefinitionof‘Public} Servant’.

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In the instant case also, the petitioners herein are sought to be prosecuted for the offence under Section 409 read with 34 I.P.C. for the

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alleged offence of criminal breach of trust in respect of the funds of the co-operative society registered under the A.P. Co-operative Societies Act, in discharge of their duties as President, Secretary and employees of the Society. In the light of the ratio laid down by the Hon’ble Apex Court in Laijit Rajshi Shah (1 supra), which was followed by this Court in the judgments noted supra, the petitioners herein cannot be considered to be 'public servants’ under Section 21 of I.P.C. When the status of the petitioners does not fail within the definition of ‘public servant’ as enjoined in Section 21 of I.P.C., initiation and continuation of criminal proceedings against them for the offence under Section 409 I.P.C. is nothing but abuse of process of law. Therefore, this Court is of the considered opinion that the subject criminal proceedings against the petitioners are liable to be quashed.

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Accordingly, this criminal petition is allowed and the proceedings against the petitioners No.2, 3 and 4 herein/Accused Nos.2, 3 and 7 in C.C.No.178 of 2016 on the file of the Judicial First Class Magistrate at Bhimadole, are hereby quashed.

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Criminal petition in respect of petitioners No.1 and 5 is dismissed as abated.

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The miscellaneous petitions pending, if any, shall also stand closed.

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SD/- M SRINIVAS ASSISTANT REGISTRAR //TRUE COPY//

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To,

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The Judicial First Class Magistrate, Bhimadole, West Godavari District. 2. The Station House Officer, Dwaraka Tirumala Police Station, West Godavari District.

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