JASDEEP SINGH BAINS Vs. STATE UNION TERRITORY CHANDIGARH

JUDGEMENT

(1.) This petition filed under Section 439 of the Code of Criminal Procedure 1973 (for brevity, Cr. P. C.) prays for grant of regular bail to the petitioner pending trial in case FIR No. 276 dated 27-11-2002 registered at Police Station Sector 26, Chandigarh under Sections 3 and 4 of the Prize Chits & Money Circulation Scheme (Banning) Act. 1978 (for brevity, the Act').

(2.) A perusal of the first information report shows that investigation was ordered to be conducted by the Finance Secretary, Chandigarh Administration vide his letter dated 24-10-2002 addressed to the Inspector General of Police (Economic Offence Wing). The Finance Secretary made a reference to the letter received by them from the Reserve Bank of India. Department of Non Banking Supervision, Central Vista, Chandigarh. The subject of the first information report is 'Market Intelligence Activities - On Line Job Work Com. Pvt. Ltd'. The company has established its corporate office at S. C. O. No. 34, Sector 26, Chandigarh. According to the allegations, the company offered two business schemes, namely. On Line Job Work and Multi Level Marketing (for brevity, 'M. L. M. Scheme'). In the M. L. M. Scheme a business associate has to enroll further business associates against payment of Rs. 16.500/- per enrolment being the cost of product, training and registration charges. For each sub-business associate enrolled, the business associate gets a commission of Rs. 5.500/- from the company and the incentive goes on increasing as revealed by the brochure and the application form. The company is not rendering any worthwhile service or product in lieu of the amount of incentive for enrolling new members. The total amount of incentive as indicated in the brochure runs to Rs. 15,000 crores under the home based business plan. The total direct incentive amounts to Rs. 22490.13 crores for effecting Rs. 2,15,23,359/- crores sales under the said plan. It is alleged that the company is mainly attracting people by offering hefty commission and enrolling members. It is basically running a pyramid scheme with some camouflages. When confronted with the observations by the Investigating agency, it was claimed that it is adhering to the provisions of the Act while launching plan under the M. L. M. Scheme. However, no details have been furnished showing the compliance of the provisions of Sections 3 and 4 of the Act. The first information report further shows the ingredients of various sections constituting the cognizable offences under Sections 3 and 4 of the Act. The investigation has further been directed to find out the amount collected by the company, number of business associates appointed and to take such action as is considered necessary under the Act against the company, its officials and against all those persons who are connected with the conduct of business in any manner under Section 5 of the Act. It is clear from the order of Additional Chief Judicial Magistrate that the company has enrolled about 7390 members after charging a sum of Rs. 16.500/- from each one of them. It has collected about a sum of Rs. 12,19,35.000/- crores. Therefore, the company is alleged to have committed offences under Sections 406/420 I.P.C. read with Sections 3 and 4 of the Act.

(3.) The petitioner filed an application for bail before the Additional Chief Judicial Magistrate, Chandigarh which was dismissed on 6-11-2003 and the learned Additional Sessions Judge, Chandigarh has upheld the aforementioned order vide his order dated 13-11-2003. Feeling aggrieved, the petitioner has approached this Court. It is appropriate to mention that an application filed under Section 438 Cr. P. C. by the petitioner and others was rejected by this Court on 23-9-2003.