PACL INDIA LTD Vs. STATE OF MADHYA PRADESH

JUDGEMENT

(1.) THE question involved in this petition appears to be simple, that whether the District Magistrate has power and authority to pass an order under section 144, Criminal Procedure Code in regard to prohibiting the petitioner - company to continue its business activities and seizure of office of the petitioner. After scanning the bulky documents and the facts of the case, we have gathered an impression that the present case is a classic example that by concealing material facts the petitioner - company wants to get relief on technicalities with intention to carry out illegal activities.

(2.) PETITIONER is a Public Limited Company incorporated under the provisions of the Companies Act on 13-2-1996. The Company was allotted an industrial activity code 082, which means Real Estate Activity vide a letter dated 6-4-1998 issued by the Department of Company Affairs, Government of India. As per pleadings of the petitioner it is a leading Real Estate Development Company with a multidimensional portfolio ranging from commercial to retail and residential segments. It also has a Customer Service Centre at 3rd Floor, Pan- Inn Plaza, Shinde Ki Chhawani, Lashkar, Gwalior, M.P. The petitioner further pleaded that it has developed number of townships and acquired tracks of land all over the country, using funds available with the company from promoters' contribution, inter accrual as well as working capital. The company receives applications from its customers for purchase and / or for development of land. As per the petitioner each business transaction between the company and customer is an independent agreement for purchase of land which is governed by a contract in writing and the customer pays consideration in full or instalments at the time of contract. The company has various types of payment plans, named as 'cash down payment plan'. The company further gives option to its customers of availing its services to develop the land or to arrange for its disposal in favour of third parties. The petitioner specifically stated that it does not hold any promise or any assurance of fixed returns to its customers at any stage of transaction.

(3.) POLICE Station Inderganj, Gwalior, issued a notice to the petitioner's Customer Service Centre at Gwalior and sought certain details from the Company. Thereafter, on 3-9-2010 District Magistrate, Gwalior also issued a Notice No. 10373, Annexure P-7 to the petitioner - Company. The District Magistrate mentioned in the show cause notice that the petitioner - Company had been receiving deposits from investors with an assurance that they would get 3 to 4 times amount after certain period, hence, the activities of the company were in contravention to the provisions of the Madhya Pradesh Nikshepakon Ke Hiton Ka Sanrankshan Adhiniyam, 2000, hereinafter referred to as the 'Act of 2000'. The District Magistrate further observed that the company had not taken permission from the Reserve Bank of India for the aforesaid purpose. The District Magistrate sought various informations from the petitioner - company including the details of all deposits received and names of the depositors, details of activities for which deposits had been made from public and whether the money so received from the depositors had been used for sale and purchase of any material, if yes, then what material was purchased at which locations.