Birla Corporation Ltd. V. Adventz Investments & Holding Ltd. & Ors.

BIRLA CORPORATION LTD. v. ADVENTZ INVESTMENTS & HOLDING LTD & ORS.

Author: Ms. Deepsi Rawat, Law College Dehradun.

JURISDICTION AND BENCH

Jurisdiction of Court

The instant case is a Special Leave Petition under Article 136 of the Constitution of India, 1950.

Bench in the Case

1. Justice R. Banumathi
2. Justice R. Subhash Reddy

Facts of the Case

1. The instant matter is between rival factions of the M.P. Birla family, running several businesses and parts of Birla industrial house in India.
2. Both the parties were involved in legal disputes with each other for a while earlier in special courts/tribunals. In one such proceeding related to oppression and mismanagement, Adventz produced a document that Birla Corporation believed to be kept in custody away from all. The only way to get the document was by stealing.
3. It was alleged by the Birla Corporation that someone has entered into the premises of the registered office and taken certain confidential documents.
4. While some documents were copied and kept back, some original documents were still in the possession of Adventz.

• CHARGES AND QUESTIONS FOR DETERMINATION

CHARGES

The following charges of the Indian Penal Code, 1860 were made out again the Respondents:

1. Section 379: Punishment for Theft
2. Section 403: Dishonest Misappropriation of Property
3. Section 411: Dishonestly Receiving Stolen Property
4. Section 120-B: Punishment of Criminal Conspiracy

QUESTIONS FOR DETERMINATION

The following questions arise for consideration in these appeals: –

1. Whether the allegations in the complaint and the statement of the complainant and other materials before the Magistrate were sufficient to constitute prima facie case to justify the satisfaction of the Magistrate in issuing process against the respondents?
2.  Whether the respondents are right in contending that in taking cognizance of the offences under Sections 380, 411 and 120-B IPC and ordering the issuance of process against the respondents is vitiated due to non-application of mind?
3. Whether the High Court was right in quashing the criminal proceedings qua documents No.1 to 28 on the ground that mere information contained in the documents cannot be considered as “moveable property” and cannot be the subject of the offence of theft or receipt of stolen property?
4. Whether filing of the documents in question in the petition before the Company Law Board to substantiate their case of oppression and mismanagement and document No.1 in the civil suits challenging revocation of the trust deeds would amount to theft justifying taking cognizance of the offences?
5. Whether there is the dishonest moving of documents causing wrongful loss to the appellants and wrongful gain to the respondents?
6.  Whether filing of documents in the judicial proceedings can be termed as an act of theft causing wrongful gain to oneself and wrongful loss to the opponent to attract the ingredients of Section 378 IPC?

• OBITER DICTA AND RATIO DECIDENDI

OBITER DICTA

1. The Magistrate must satisfy himself before taking cognizance of an offence. He must ensure that a prima facie case is made after considering the facts and the evidence and witnesses produced by the complainant. He can conduct inquiries either himself or direct a police officer to conduct an inquiry.
2. Information contained in a document, if replicated, can be the subject of theft and can result in wrongful loss, even though the original document was only temporarily removed from its lawful custody for the purpose of extracting the information contained therein.
3. The intention is the gist of the offence of theft. It is an essential ingredient of the offence of “theft” that the movable property should have been “moved” out of the possession of any person without his consent.
4. It is well settled that the inherent jurisdiction under Section 482 Cr.P.C. is designed to achieve a salutary purpose and that the criminal proceedings ought not to be permitted to degenerate into a weapon of harassment. When the Court is satisfied that the criminal proceedings amount to an abuse of process of law or that it amounts to bringing pressure upon the accused, in the exercise of the inherent powers, such proceedings can be quashed.
5. The FIR or the criminal proceedings can be quashed if the allegations do not make out a prima-facie case or allegations are so improbable that no prudent person would ever reach a just conclusion that there are sufficient grounds for proceeding against the accused.

RATIO DECIDENDI

1. The cognizance taken by the magistrate of the offence is not well-founded the order summoning the accused cannot be sustained. The impugned order of the High Court holding that there was compliance of the procedure under Section 202 Cr.P.C. cannot be sustained and is liable to be set aside.
2. By filing the documents in the legal proceedings, there is no intention on the part of the respondents to cause “wrongful loss” to the appellant nor intention to make “wrongful gain” to themselves. The filing of the documents in the legal proceedings is only to vindicate their standing the company petition.
3. It is held that the “document” as defined in Section 29 IPC is a “moveable property” within the meaning of Section 22 IPC which can be the subject matter of theft. The information contained thereon in the documents would also fall within the purview of the “corporeal property” and can be the subject matter of the theft
4. But merely because the respondents have not called for the documents as per the provisions, it cannot be said that they have committed “theft”.
5. Considering the facts and circumstances of the present case and the number of litigations pending between the parties, in our considered view, the continuation of the criminal proceedings would be an abuse of the process of the court. The order of the Magistrate dated 08.10.2010 taking cognizance of the offences and the issuance of summons to respondents No.1 to 16 and the criminal proceedings thereon are liable to be quashed.

CRITICAL APPRAISAL

• The cognizance of the case by the magistrate was held to be ill-founded and the issue of summoning by the court was not sustained. However, the Magistrate had conducted inquiry himself before taking cognizance as well as Section 464 of Code of Criminal Procedure declares that the court cannot refuse to take cognizance of an offence owing to irregularities or omission or failure to state facts as to the place, time, manner and the person committing the offence.
• In the instant case, the court held that the filing of confidential documents of Birla Corporation by Adventz did not amount to theft as there was no intention of causing any wrongful loss or wrongful gain to themselves. However, the court made an error by confusing motive with intention. The court founded that the ultimate purpose of wrongfully moving the documents was ultimately for the purpose of litigation. The court failed to recognize the ill intention of the respondent the court maid higher attention to the purpose for which the documents were obtained.