RAM NARESH AGRAWAL Vs. STATE OF BIHAR

JUDGEMENT

(1.) This petition under Section 482 of the Code of Criminal Procedure, hereinafter to be referred to as 'the Code' has been filed by the above named petitioners for quashing the entire criminal proceedings in Giddi P.S. Case No, 68 of 1987 (G.R. Case No. 2337 of 1987) and also the order dated 1-8-1992 by which cognizance of the offence under Section 7 of the Essential Commodities Act (the Act) was taken against the petitioners by the Special Judge, Hazaribagh.

(2.) When the cognizance was taken by the learned Special Judge, Hazaribagh, the petitioners came up before this Court on earlier occasion in Cr.Misc. No. 4190 of 1992 (R) but this Court allowed the petitioners to withdraw their petition under Section 482 of the Code in that case giving liberty to raise their points before the Special Judge, Hazaribagh, at the appropriate stage. After withdrawal of the abovementioned case, the petitioners filed a petition before the Special Judge, Hazaribagh on 21-1-1993 for discharge of the petitioners on the ground that the petitioners had ceased to be the Directors of the firm, namely, M/s. New Bharat Refractories where criminal case had been instituted under Section 7 of the Act against the aforesaid firm, but such petition was dismissed and direction was made to frame charges under Sections 420, 467, 468, 471, 120-B and 469 of the Indian Penal Code read with Sections 7 and 8 of the Act against the petitioners alongwith others. According, the petitioners to M/s. New Bharat Refractories Limited is a Company registered under the Indian Companies Act and its registered office is situated at Lilua, Howrah within the State of West Bengal having its factory situated at Baraichnagar, under Ramgarh Police Station. In the year 1981, M/s. New Bharat Refractories Limited had its Board of Directors consisting of three persons, namely, Kedar Nath Agarwal, petitioner No.2, Ram Pravesh Agarwal and Ram Naresh Agarwal, petitioner No. 1. But subsequently the petitioners had transferred their share to R. C. Agarwal and Smt. Sarala Agarwal in the year 1982 and then the petitioners have ceased all their connections as Directors of the said Company. After 1982 M/s. New Bharat Refractories Limited have got the Board of Directors consisting of three persons, namely, Ram Pravesh Agarwal, R.C. Agarwal and Smt. Sarala Agarwal and the annual report of the Company in the name of the Board of Directors as mentioned above was submitted to the Registrar of the Companies in the year 1982 which has been annexed as Annexure-1 to this petition and the said Directors since 1982 continued to remain so. In the year 1987, the annual report also, the names of the three Directors as mentioned above by the aforementioned Company were recorded and the Annexure-2 reveals so. Thus, according to the petitioners, since after 1982, the petitioners had no connection as Directors of the abovementioned Company and as per the Factories Act, only the Directors are deemed to be occupier and responsible for the day to day affairs of the Company. On 10-11-1987 one Dineshwar Prasad Choudhary lodged a first information report with the officer-in-charge of Mandu Police Station in the District of Hazaribagh, alleging that M/s. New Bharat Refractories Limited was indulging in illegal trade of coal and thereby violating the provision of Bihar Trade Articles (Licenses Unification) Order, 1984, (the Unification Order) and have thus committed an offence under Section 7 of the Act. It was also alleged that in making some illegal trade, several documents have been forged by the above-mentioned Company and its officials. It was alleged that the coal was being smuggled to the State of Uttar Pradesh from the State of Bihar violating all Rules/Orders from time to time passed by the State Government and also as per the Unification Order mentioned above.

(3.) From the very beginning the petitioners were taking the plea that in the first information report, illegally their names have been mentioned as Directors of M/s. New Bharat Refractories Limited. They were not in any way connected as Directors of the Company as they have already transferred their share long back in the year 1982 and a separate Board of Directors had been constituted since 1982 and that continued till 1987 also. It was also mentioned that out of three Directors, Ram Pravesh Agarwal was the Managing Director and he was only looking after the factory situated at Ramgarh in the District of Hazaribagh. This point was raised by the petitioners when they moved for bail and practically on consideration of that point, their bail was granted. It is also the contention of the petitioners that during the course of investigation also, it came to the knowledge of the investigating agency that the present petitioners were in no way connected as Directors of the above-mentioned Company and having any control/management of the day to day affairs of the Company in question.