T.V. RAMANATHAN, MANAGING DIRECTOR AND CHIEF OPERATING OFFICER, EXIDE INDUSTRIES LTD. AND ANR. Vs. STATE OF JHARKHAND AND ANR.

JUDGEMENT

(1.) THE petitioners have preferred this petition under Section 482 Cr.P.C. for quashing the entire criminal proceeding initiated against them including the order dated 5.4.2006 passed by the Judicial Magistrate, 1st Class, Ranchi in C.P. Case No. 1388/05 whereby and where -under cognizance of the offence has been taken under Section 406/420 read with 120B, IPC against the petitioners now pending in the Court of Shri Sanjay Kumar, Judicial Magistrate, Ranchi.

(2.) THE brief fact of the case as narrated in the Complaint Petition filed by the O.P. No. 2 was that he was the C & F agent for South Bihar based at Ranchi of the Standard Batteries Limited (S.B.L. in short). He had paid Rs. 10 lakhs as Security deposit to S.B.L. by D.D. No. 01726/323/ 457 dated 28.7.1995 and D.D. No. 02195/ 323/457/95 dated 28.8.1995 as confirmed by the letters dated 28.7.1995 and 28.8.1995 of the accused No. 1 D.K. Verma, Former Branch Manager of S.B.L., Ranchi on behalf of S.B.L. Money receipts were also issued in lieu of such security deposits. It was promised and confirmed by accused No. 2 A.K. Ghai that 18% interest would be given in respect of the security deposits by the complainant. However, the complainant/O.P. No. 2 received notice from the accused No. 3 F.J. Guzdar on behalf of S.B.L. vide letter dated 20.2.1998 that its C & F agency stood terminated with effect from 1.3.1998 on the ground that S.B.L. had sold/transferred its undertaking to M/s Exide Industries Limited with effect from 16.2.1998 and the aforesaid letter terminating the C & F agency of the complainant was ostensibly sent ante dated mentioning the date 20.2.1998, though its envelop recorded the correct date of dispatch as on 23.3.1998. The complainant O.P. No. 2 vide letter dated 17.4.1998 protested against the termination of his C & F agency without clearing his dues in the kind of security deposits. The complainant pointed out that under the agreement dated 21st November, 1997 the S.B.L.'s entire manufacturing of lead acid batteries and miners cap lamp business comprising of assets both tangible and intangible and including net current assets were sold on 'slump sale basis' to M/s Exide Industries Limited (in short E.I.L.). Subsequently E.I.L. acquired the assets and liabilities of Standard Batteries Limited (S.B.L.) in February, 1998, as was evident from the true copy of the Director's report dated 12.5.1999 of Standard Batteries Ltd. The complainant/O.P. No. 2 sent several letters at least on 5 dates to E.I.L. for release of its outstanding dues but to no avail. The complainant defined slump sale which means the transfer of one or more business undertaking as a result of the sale for a lump sum consideration without as signing values to individual assets and liabilities. The complainant alleged that on the one hand M/s. Exide Industries Limited was benefited from the mechanism of a slump sale as far as taxation matters were concerned. But on the other hand, it denied liabilities, which it owed to the third parties like the complainant as a consequence of slump sale. The outstanding payments due to the complainant came squarely within the meaning of liabilities of S.B.L. which was transferred to the E.I.L. The complainant/O.P. No 2 further stated that M/s Exide Industries Limited vide letter No. Nil dated 5.3.2001 had requested him to furnish the details of the outstanding amount which was promptly responded by sending the complete statement of accounts vide its letter No. E.M.K./Exide/2001/137 dated 13.3.2001. The action of the E.I.L. therefore, in demanding the statement of accounts and then denying the liability of E.I.L. clearly displayed the criminal intent on the part of the managerial officials of the E.I.L. which constituted documentary evidence that the E.I.L. officials in collusion with S.B.L. Officials made it to appear that the termination of C & F agency of the complainant was contemporaneous with the sale and transfer of S.B.L's undertaking to E.I.L. with the mens rea so that E.I.L. may deceptively shirk off its responsibility to pay back the outstanding of the complainant/O.P. No. 2 on the false pretext that it ever had dealings with him.

(3.) MR . P.P.N. Roy, learned senior counsel submitted that the petitioner No. 1 T.V. Ramanathan is the Managing Director and Chief Operating Officer in the Exide Industries Ltd. whereas petitioner No. 2 Barun Das is the Divisional Head as well as Legal & Company Secretary in the Exide Industries Ltd. It is to make it clear and to be noted that on account of agreement dated 21.11.1997 for transfer an industrial undertaking with S.B.L., an existing company under the Companies Act, 1956 Exide Industries Ltd. had not taken over S.B.L., rather only certain assets and liabilities of the S.B.L. was purchased by the E.I.L. for a net purchase consideration which however does not include any amount allegedly payable to the complainant/O.P. No. 2. This fact was conveyed to the complainant by the letter of the E.I.L. dated 14.4.2003 and 23.12.2004. Against the several letters written by the complainant/O.P. No. 2. Exide Industries Ltd. had replied categorically denying any contract with the complainant and the petitioners with certain clarification that certain assets and liabilities which were acquired from S.B.L. by E.I.L. in 1997 do not include any amount shown as payable to the complainant O.P. No. 2. By another letter dated 19th November, 2004 it was alleged by the complainant that the petitioners were acting as successors in interest of S.B.L. and again it was clarified that in the year 1997 only certain assets and liabilities of S.B.L. were taken over by E.I.L. which did not include the alleged amount as mala fidely demanded by him. As a matter of fact, S.B.L. was never merged with the E.I.L. The petitioners had advised the complainant to take up the matter with the Standard Batteries Ltd. as it continued to be a distinctly separate entity.