CASE NO.: Appeal (crl.) 175 of 2007 PETITIONER: S.K. SINHA, CHIEF ENFORCEMENT OFFICER RESPONDENT: VIDEOCON INTERNATIONAL LTD. & ORS. DATE OF JUDGMENT: 25/01/2008 BENCH: C.K. THAKKER & P.P. NAOLEKAR JUDGMENT:
J U D G M E N T
ARISING OUT OF SPECIAL LEAVE PETITION (CRL) NO. 5718 OF 2006
C.K. THAKKER, J.
1. Leave granted.
2. In the present appeal, we are called
upon to decide the correctness or otherwise of
the proposition of law by the High Court of
Judicature at Bombay whether issuance of
process in a criminal case is one and the same
thing or can be equated with taking cognizance
by a Criminal Court? And if the period of
initiation of criminal proceedings has elapsed
at the time of issue of process by a Court, the
proceedings should be quashed as barred by
limitation?
3. To appreciate the controversy raised
in the appeal instituted by the Chief
Enforcement Officer, Enforcement Directorate,
Government of India (appellant herein), few
relevant facts may be noted.
4. Respondent No.1M/s. Videocon
International Ltd. (Company for short) is a
Public Limited Company incorporated under the
Companies Act, 1956 having its business at
Mumbai and Aurangabad in the State of
Maharashtra. On October 13, 1989, the Company
entered into an agreement with Radio Export
(Moscow) for the supply of colour tubes,
electrolytic capacitors, transformers, etc.,
for Rs.44,04,00,000/-. The payment was made by
respondent No.1 Company to Japanese and Korean
suppliers. But before any payment could be
received by respondent No.1 from the USSR
Company, there was political turmoil in the
USSR and payment to foreign suppliers was
disrupted. On January 5, 1993, Additional
Director General, Directorate of Revenue
Intelligence, Mumbai addressed a letter to the
appellant alerting him about the activities of
the Company in connection with the agreement to
supply television sets to Radio Export, Moscow.
Based on the information forwarded by the
Directorate of Revenue Intelligence, Bombay,
the appellant addressed two letters to the
Chief Manager of Indian Bank, Nariman Point,
Bombay requesting the Bank to supply details of
the export outstanding of the Company. Indian
Bank supplied necessary information and
indicated that the export outstanding of the
Company was Rs.16,60,00,000/-. The Reserve Bank
of India turned down the request of the Company
for reimbursement of differential amount
remaining unpaid on the ground that the exports
were effected from Korea and Japan and not from
India and the Company was not entitled to
reimbursement. In pursuance of the summons
issued under Section 40 of the Foreign Exchange
Regulation Act, 1973 (hereinafter referred to
as FERA), Raj Kumar Dhoot, Director of the
Company appeared before the Department on April
25, 1999 and made a statement that there was an
agreement between the Company and M/s Radio
Export, Moscow for supply of two lakh
television sets and other equipments for
Rs.44,04,00,000/-. The amount was received by
the Company through State Bank of India,
Overseas Branch, Bombay. He further stated that
the television sets had been procured from
Korea and Japan who had been paid equivalent to
Rs.19,00,00,000/- in foreign exchange. Export
bills raised from the sale to M/s Radio Export,
Moscow were equivalent to Rs.16,00,00,000/-.
Whereas the contract with the suppliers in
Korea and Japan stipulated payment in US
Dollars, the contract with the USSR Company
required payment in Indian Rupees. Since the
value of Rupee against the US Dollar fell down,
the Company had to pay more Rupees to their
foreign suppliers. On June 1, 2000, FERA was
replaced by the Foreign Exchange Management
Act, 1999 (hereinafter referred to as FEMA).
5. On May 24, 2002, the appellant-
complainant in the capacity as Chief
Enforcement Officer, Government of India, filed
Criminal Complaint No. 1149/S/2002 against the
Company alleging that the Company had received
an amount of Rs.44,04,00,000/- through State
Bank of India, Bombay but it failed to take
steps to realize export proceeds amounting to
Rs.16,60,00,000/- within the stipulated period
of six months. It thereby contravened Section
18(2) and 18(3) read with Section 68(1),
punishable under Section 56(1)(ii) of FERA. On
the same day, i.e. on May 24, 2002, after
hearing the learned counsel for the Department,
the Chief Metropolitan Magistrate, Esplanade,
Mumbai took cognizance of the offence and
issued summons to the accused. On February 3,
2003, the Chief Metropolitan Magistrate issued
process requiring the respondents to appear
before the Court and answer the charge under
FERA.
6. In October, 2004, the respondents
filed a petition being Criminal Writ Petition
No. 476 of 2005 in the High Court of Judicature
at Bombay by invoking Article 227 of the
Constitution as also Section 482 of the Code of
Criminal Procedure, 1973 (hereinafter referred
to as the Code) seeking quashing of criminal
proceedings initiated vide complaint dated May
24, 2002 on the ground that cognizance was
taken by the Court after the period of
limitation and the proceedings were, therefore,
liable to be quashed. The High Court, by the
impugned order dated April 26, 2006, quashed
the proceedings initiated against the
respondents on the ground that cognizance could
be said to have been taken when process was
issued and since process was issued in
February, 2003, the proceedings were time-
barred. The complaint was, therefore, quashed
by the High Court. The said order is challenged
by the appellant in the present appeal.
7. Notice was issued by this Court on
September 29, 2006. The respondents appeared.
Counter affidavit and rejoinder affidavit were
then filed. The Registry was directed to place
the matter for final hearing on a non-
miscellaneous day and that is how the matter is
placed before us.
8. We have heard the learned counsel for
the parties.
9. The learned counsel for the appellant
contended that the High Court was in clear
error in equating taking cognizance of an
offence with issuance of process and in holding
that the cognizance was taken after the period
of limitation and hence the proceedings were
time-barred and liable to be quashed. It was
submitted that FEMA came into force from June
1, 2000 and under sub-section (3) of Section 49
of FEMA, cognizance of an offence under FERA
could have been taken within a period of two
years from the date of commencement of the new
Act. It was submitted that cognizance was taken
by the Chief Metropolitan Magistrate, Mumbai on
May 24, 2002, i.e. the day when complaint was
filed which was well within the period of
limitation provided by Section 49(3) of FEMA
and as such the Criminal Court was within its
power in issuing process and in proceeding with
the matter and the High Court was not justified
in quashing the proceedings on the ground that
cognizance was taken by the Court on February
3, 2003 when process was issued by the Chief
Metropolitan Magistrate, Mumbai. It was
alternatively submitted by the learned counsel
that the relevant date for counting the period
of limitation is not the date of taking
cognizance or issuance of process by the Court
but the date of filing complaint. It was stated
that the point has been concluded by various
decisions of this Court. Since the complaint
was filed on May 24, 2002, which was within the
period of limitation, the High Court was wrong
in treating the criminal complaint as barred by
limitation and in quashing it. The order passed
by the High Court, thus, deserves to be set
aside by directing the Chief Metropolitan
Magistrate, Mumbai to proceed with the case and
decide it in accordance with law.
10. The learned counsel for the
respondents, on the other hand, supported the
order passed by the High Court. It was
submitted that the High Court was wholly right
in quashing the proceedings. Admittedly,
process was issued in February, 2003 while
under Section 49(3) of FEMA, proceedings under
the old Act (FERA) could not have been
initiated after the expiry of two years from
the commencement of the new Act (FEMA). FEMA
came into force on June 1, 2000 and hence
cognizance of an offence under FERA could have
been taken under FEMA latest by June 1, 2002.
Issuance of process in February, 2003,
therefore, was clearly time-barred and the High
Court was right in quashing the proceedings. It
was also submitted that the appellant was not
right in submitting that the relevant date for
computing the period of limitation is date of
filing of complaint. The material date is the
date of taking cognizance by a competent
Criminal Court. Sub-section (3) of Section 49
of FEMA is a special provision, which must be
given effect to and even on that ground, the
complaint was barred by time. Finally, it was
submitted that though the High Court had not
considered the merits of the matter, the
provisions of FERA had no application to the
facts of the case as it cannot be said that the
accused had committed any offence under FERA.
Considering the said fact also, this Court may
not interfere with the order passed by the High
Court in exercise of discretionary jurisdiction
under Article 136 of the Constitution. It was,
therefore, submitted that the appeal may be
dismissed.
11. Having heard learned counsel for the
parties and having perused the relevant
provisions of law as also various judicial
pronouncements, we are of the view that the
High Court was in error in equating issuance of
process with taking cognizance by a Criminal
Court and in quashing the proceedings treating
them as time-barred.
12. The expression cognizance has not
been defined in the Code. But the word
(cognizance) is of indefinite import. It has no
esoteric or mystic significance in criminal
law. It merely meansbecome aware of and when
used with reference to a Court or a Judge, it
connotes to take notice ofjudicially. It
indicates the point when a Court or a
Magistrate takes judicial notice of an offence
with a view to initiating proceedings in
respect of such offence said to have been
committed by someone. Taking cognizance does
not involve any formal action of any kind. It
occurs as soon as a Magistrate applies his mind
to the suspected commission of an offence.
Cognizance is taken prior to commencement of
criminal proceedings. Taking of cognizance is
thus a sine qua non or condition precedent for
holding a valid trial. Cognizance is taken of
an offence and not of an offender. Whether or
not a Magistrate has taken cognizance of an
offence depends on the facts and circumstances
of each case and no rule of universal
application can be laid down as to when a
Magistrate can be said to have taken
cognizance. Chapter XIV (Sections 190-199) of
the Code deals with Conditions requisite for
initiation of proceedings. Section 190
empowers a Magistrate to take cognizance of an
offence in certain circumstances. Sub-section
(1) thereof is material and may be quoted in
extenso.
1) Subject to the provisions of this
Chapter, any Magistrate of the first
class, and any Magistrate of the
second class specially empowered in
this behalf under sub-section (2), may
take cognizance of any offence
(a) upon receiving a complaint of
facts which constitute such offence;
(b) upon a police report of such
facts;
(c) upon information received from any
person other than a police officer, or
upon his own knowledge, that such
offence has been committed.
13. Chapter XV (Sections 200-203) relates
to Complaints to Magistrates and covers cases
before actual commencement of proceedings in a
Court or before a Magistrate. Section 200 of
the Code requires a Magistrate taking
cognizance of an offence to examine the
complainant and his witnesses on oath. Section
202, however, enacts that a Magistrate is not
bound to issue process against the accused as a
matter of course. It enables him before the
issue of process either to inquire into the
case himself or direct an investigation to be
made by a Police Officer or by such other
person as he thinks fit for the purpose of
deciding whether there is sufficient ground for
proceeding further. The underlying object of
the inquiry under Section 202 is to ascertain
whether there is prima facie case against the
accused. It thus allows a Magistrate to form an
opinion whether the process should or should
not be issued. The scope of inquiry under
Section 202 is, no doubt, extremely limited. At
that stage, what a Magistrate is called upon to
see is whether there is sufficient ground for
proceeding with the matter and not whether
there is sufficient ground for conviction of
the accused.
14. Then comes Chapter XVI (Commencement
of proceedings before Magistrates). This
Chapter will apply only after cognizance of an
offence has been taken by a Magistrate under
Chapter XIV. Section 204, whereunder process
can be issued, is another material provision
which reads as under:
204.Issue of process.- (1) If in the
opinion of a Magistrate taking
cognizance of an offence there is
sufficient ground for proceeding, and
the case appears to be
(a) a summons-case, he shall issue his
summons for the attendance of the
accused, or
(b) a warrant-case, he may issue a
warrant, or, if he thinks fit, a
summons, for causing the accused to be
brought or to appear at a certain time
before such Magistrate or (if he has
no jurisdiction himself) some other
Magistrate having jurisdiction.
(2) No summons or warrant shall be
issued against the accused under sub-
section (1) until a list of the
prosecution witnesses has been filed.
(3) In a proceeding instituted upon a
complaint made in writing, every
summons or warrant issued under sub-
section (1) shall be accompanied by a
copy of such complaint.
(4) When by any law for the time being
in force any process-fees or other
fees are payable, no process shall be
issued until the fees are paid and, if
such fees are not paid within a
reasonable time, the Magistrate may
dismiss the complaint.
(5) Nothing in this section shall be
deemed to affect the provisions of
section 87.
15. From the above scheme of the Code, in
our judgment, it is clear that Initiation of
Proceedings, dealt with in Chapter XIV, is
different from Commencement of Proceedings
covered by Chapter XVI. For commencement of
proceedings, there must be initiation of
proceedings. In other words, initiation of
proceedings must precede commencement of
proceedings. Without initiation of proceedings
under Chapter XIV, there cannot be commencement
of proceedings before a Magistrate under
Chapter XVI. The High Court, in our considered
view, was not right in equating initiation of
proceedings under Chapter XIV with commencement
of proceedings under Chapter XVI.
16. Let us now consider the question in
the light of judicial pronouncements on the
point.
17. In Superintendent & Remembrancer of
Legal Affairs Vs. Abani Kumar Banerjee, AIR
1950 Calcutta 437, the High Court of Calcutta
had an occasion to consider the ambit and scope
of the phrase taking cognizance under Section
190 of the Code of Criminal Procedure, 1898
which was in pari materia to Section 190 of the
present Code of 1973. Referring to various
decisions, Das Gupta, J. (as His Lordship then
was) stated:
What is taking cognizance has not
been defined in the Criminal Procedure
Code, and I have no desire now to
attempt to define it. It seems to me
clear, however, that before it can be
said that any Magistrate has taken
cognizance of any offence under
Section 190(1)(a), Criminal P. C., he
must not only have applied his mind to
the contents of the petition, but he
must have done so for the purpose of
proceeding in a particular way as
indicated in the subsequent provisions
of this Chapter,-proceeding under
Section 200, and thereafter sending it
for enquiry and report under Section
202. When the Magistrate applies his
mind not for the purpose of proceeding
under the subsequent sections of this
Chapter, but for taking action of some
other kind, e.g., ordering
investigation under Section 156(3), or
issuing a search warrant for the
purpose of the investigation, he
cannot be said to have taken
cognizance of the offence.
18. R.R. Chari v. State of Uttar Pradesh,
1951 SCR 312 was probably the first leading
decision of this Court on the point. There, the
police, having suspected the appellant-accused
to be guilty of offences punishable under
Sections 161 and 165 of the Indian Penal Code
(IPC) as also under the Prevention of
Corruption Act, 1947, applied to the District
Magistrate, Kanpur to issue warrant of arrest
on October 22, 1947. Warrant was issued on the
next day and the accused was arrested on
October 27, 1947. On March 25, 1949, the
accused was produced before the Magistrate to
answer the charge-sheet submitted by the
prosecution. According to the accused, on
October 22, 1947, when warrant for his arrest
was issued by the Magistrate, the Magistrate
was said to have taken cognizance of offence
and since no sanction of the Government had
been obtained before that date, initiation of
proceedings against him was unlawful. The
question before the Court was as to when
cognizance of the offence could be said to have
been taken by the Magistrate under Section 190
of the Code. Considering the circumstances
under which cognizance of offence under sub-
section (1) of Section 190 of the Code can be
taken by a Magistrate and referring to Abani
Kumar Banerjee, the Court, speaking through
Kania, C.J. stated:
It is clear from the wording of the
section that the initiation of the
proceedings against a person commences
on the cognizance of the offence by
the Magistrate under one of the three
contingencies mentioned in the
section. The first contingency
evidently is in respect of non-
cognizable offences as defined in the
Criminal Procedure Code on the
complaint of an aggrieved person. The
second is on a police report, which
evidently is the case of a cognizable
offence when the police have completed
their investigation and come to the
Magistrate for the issue of a process.
The third is when the Magistrate
himself takes notice of an offence and
issues the process. It is important to
remember that in respect of any
cognizable offence, the police, at the
initial stage when they are
investigating the matter, can arrest a
person without obtaining an order from
the Magistrate. Under section 167(b)
of the Criminal Procedure Code the
police have of course to put up the
person so arrested before a Magistrate
within 24 hours and obtain an order of
remand to police custody for the
purpose of further investigation, if
they so desire. But they have the
power to arrest a person for the
purpose of investigation without
approaching the Magistrate first.
Therefore in cases of cognizable
offence before proceedings are
initiated and while the matter is
under investigation by the police the
suspected person is liable to be
arrested by the police without an
order by the Magistrate.
19. Approving the observations of Das
Gupta, J. in Abani Kumar Banerjee, this Court
held that it was on March 25, 1949 when the
Magistrate issued a notice under Section 190 of
the Code against the accused that he took
cognizance of the offence. Since before that
day, sanction had been granted by the
Government, the proceedings could not be said
to have been initiated without authority of
law.
20. Again in Narayandas Bhagwandas
Madhavdas v. State of West Bengal, (1960) 1 SCR
93, this Court observed that when cognizance is
taken of an offence depends upon the facts and
circumstances of each case and it is impossible
to attempt to define what is meant by taking
cognizance. Issuance of a search warrant for
the purpose of an investigation or a warrant of
arrest of accused cannot by itself be regarded
as an act of taking cognizance of an offence.
It is only when a Magistrate applies his mind
for proceeding under Section 200 and subsequent
sections of Chapter XV or under Section 204 of
Chapter XVI of the Code that it can be
positively stated that he had applied his mind
and thereby had taken cognizance of an offence
[see also Ajit Kumar Palit v. State of W.B. &
Anr., (1963) Supp (1) SCR 953; Hareram Satpathy
v. Tikaram Agarwala & Anr., (1978) 4 SCC 58].
21. In Gopal Das Sindhi & Ors. v. State of
Assam & Anr., AIR 1961 SC 986, referring to
earlier judgments, this Court said:
We cannot read the provisions of
Section 190 to mean that once a
complaint is filed, a Magistrate is
bound to take cognizance if the facts
stated in the complaint disclose the
commission of any offence. We are
unable to construe the word may in
Section 190 to mean must. The reason
is obvious. A complaint disclosing
cognizable offences may well justify a
Magistrate in sending the complaint
under Section 156(3) to the police for
investigation. There is no reason why
the time of the Magistrate should be
wasted when primarily the duty to
investigate in cases involving
cognizable offences is with the
police. On the other hand, there may
be occasions when the Magistrate may
exercise his discretion and take
cognizance of a cognizable offence. If
he does so then he would have to
proceed in the manner provided by
Chapter XVI of the Code.
22. In Nirmaljit Singh Hoon v. State of
West Bengal & Anr., (1973) 3 SCC 753, the Court
stated that it is well settled that before a
Magistrate can be said to have taken cognizance
of an offence under Section 190(1) (a) of the
Code, he must have not only applied his mind to
the contents of the complaint presented before
him, but must have done so for the purpose of
proceeding under Section 200 and the provisions
following that section. Where, however, he
applies his mind only for ordering an
investigation under Section 156(3) or issues a
warrant for arrest of accused, he cannot be
said to have taken cognizance of the offence.
23. In Darshan Singh Ram Kishan v. State
of Maharashtra, (1972) 1 SCR 571, speaking for
the Court, Shelat, J. stated that under Section
190 of the Code, a Magistrate may take
cognizance of an offence either (a) upon
receiving a complaint, or (b) upon a police
report, or (c) upon information received from a
person other than a police officer or even upon
his own information or suspicion that such an
offence has been committed. As has often been
said, taking cognizance does not involve any
formal action or indeed action of any kind. It
occurs as soon as a Magistrate applies his mind
to the suspected commission of an offence.
Cognizance, thus, takes place at a point when a
Magistrate first takes judicial notice of an
offence.
24. In Devarapalli Lakshminarayana Reddy &
Ors. v. V. Narayana Reddy & Ors., (1976) 3 SCC
252, this Court said:
It is well settled that when a
Magistrate receives a complaint, he is
not bound to take cognizance if the
facts alleged in the complaint,
disclose the commission of an offence.
This is clear from the use of the
words “may take cognizance” which in
the context in which they occur cannot
be equated with must take cognizance”.
The word “may” gives a discretion to
the Magistrate in the matter. If on a
reading of the complaint he finds that
the allegations therein disclose a
cognizable offence and the forwarding
of the complaint to the police for
investigation under Section 156(3)
will be conducive to justice and save
the valuable time of the Magistrate
from, being wasted in enquiring into a
matter which was primarily the duty of
the police to investigate, he will be
justified in adopting that course as
an alternative to taking cognizance of
the offence, himself.
This raises the incidental question :
What is meant by “taking cognizance of
an offence” by a Magistrate within the
contemplation of Section 190?. This
expression has not been defined in the
Code. But from the scheme of the Code,
the content and marginal heading of
Section 190 and the caption of Chapter
XIV under which Sections 190 to 199
occur, it is clear that a case can be
said to be instituted in a Court only
when the Court takes cognizance of the
offence alleged therein. The ways in
which such cognizance can be taken are
set out in Clauses (a), (b) and (c) of
Section 190(1). Whether the Magistrate
has or has not taken cognizance of the
offence will depend on the
circumstances of the particular case
including the mode in which the case
is sought to be instituted and the
nature of the preliminary action, if
any, taken by the Magistrate. Broadly
speaking, when on receiving a
complaint, the Magistrate applies his
mind for the purposes of proceeding
under Section 200 and the succeeding
sections in Chapter XV of the Code of
1973, he is said to have taken
cognizance of the offence within the
meaning of Section 190(1)(a). If,
instead of proceeding under Chapter
XV, he has in the judicial exercise of
his discretion, taken action of
some other kind, such as issuing a
search warrant for the purpose
of investigation, or ordering
investigation by the police under
Section 156(3), he cannot be said to
have taken cognizance of any offence.
[see also M.L. Sethi v. R.P. Kapur &
Anr., (1967) 1 SCR 520].
25. In the case on hand, it is amply clear
that cognizance of the offence was taken by the
Chief Metropolitan Magistrate, Mumbai on May
24, 2002, i.e., the day on which the complaint
was filed, the Magistrate, after hearing the
counsel for the department, took cognizance of
the offence and passed the following order:
Mr. S.A.A. Naqvi, counsel for the
department is present. Complainant is
public servant. Cognizance is taken.
Issue summons to accused under Section
18(2)(3) of FERA, 73 read with Central
Notification and r/w Section 68(1) of
the said Act and r/w 56 (1)(i) and r/w
Section 49(3) (4) of FEMA, 1999.
Summons returnable on 7.2.2003 at 3
p.m. (emphasis supplied)
26. Undoubtedly, the process was issued on
February 3, 2003. In our judgment, however, it
was in pursuance of the cognizance taken by the
Court on May 24, 2002 that a subsequent action
was taken under Section 204 under Chapter XVI.
Taking cognizance of offence was entirely
different from initiating proceedings; rather
it was the condition precedent to the
initiation of the proceedings. Order of
issuance of process on February 3, 2003 by the
Court was in pursuance of and consequent to
taking cognizance of an offence on May 24,
2002. The High Court, in our view, therefore,
was not right in equating taking cognizance
with issuance of process and in holding that
the complaint was barred by law and criminal
proceedings were liable to be quashed. The
order passed by the High Court, thus, deserves
to be quashed and set aside.
27. It was also contended by the learned
counsel for the appellant that the relevant
date for considering the question of limitation
is the date of filing of complaint and not
taking cognizance or issuance of process by a
Court of law. In this connection, our attention
was invited by the counsel to Bharat Damodar
Kale & Anr. v. State of A.P., (2003) 8 SCC 559
and a recent decision of this Court in Japani
Sahoo v. Chandra Sekhar Mohanty, (2007) 7 SCC
394. In Japani Sahoo, one of us (C.K. Thakker,
J.), after considering decisions of various
High Courts as also Bharat Damodar Kale,
stated:
52. The matter can be looked at from
different angle also. Once it is
accepted (and there is no dispute
about it) that it is not within the
domain of the complainant or
prosecuting agency to take cognizance
of an offence or to issue process and
the only thing the former can do is to
file a complaint or initiate
proceedings in accordance with law.
If that action of initiation of
proceedings has been taken within the
period of limitation, the complainant
is not responsible for any delay on
the part of the Court or Magistrate in
issuing process or taking cognizance
of an offence. Now, if he is sought to
be penalized because of the omission,
default or inaction on the part of the
Court or Magistrate, the provision of
law may have to be tested on the
touchstone of Article 14 of the
Constitution. It can possibly be
urged that such a provision is totally
arbitrary, irrational and
unreasonable. It is settled law that a
Court of Law would interpret a
provision which would help sustaining
the validity of law by applying the
doctrine of reasonable construction
rather than making it vulnerable and
unconstitutional by adopting rule of
litera legis. Connecting the
provision of limitation in Section 468
of the Code with issuing of process or
taking of cognizance by the Court may
make it unsustainable and ultra vires
Article 14 of the Constitution.
28. The learned counsel for the
respondent, on the other hand, tried to
distinguish Bharat Damodar Kale and Japani
Sahoo submitting that in both the decisions,
this Court was called upon to consider, inter
alia, Section 468 of the Code providing for
limitation for taking cognizance of certain
offences. According to the counsel, Section 468
of the Code starts with the expression Except
as provided elsewhere in this Code. Section
49(3) of FEMA, on the other hand, starts with a
non-obstante clause (Notwithstanding anything
contained in any other law for the time being
in force). It was, therefore, submitted that
the ratio laid down in the above two cases
would not be applicable to the instant case.
29. In our opinion, it would not be
necessary for us to express any opinion one way
or the other on the larger question. We have
already held in the earlier part of the
judgment that in the case on hand, cognizance
of an offence had already been taken by the
Chief Metropolitan Magistrate, Mumbai on May
24, 2002, well within the period prescribed by
sub-section (3) of Section 49 of FEMA within
two years of coming into force of the Act from
June 1, 2000. We, therefore, express no opinion
on the question raised by the learned counsel
for the respondent.
30. As regards quashing of proceedings on
merits, the learned counsel for the appellant
is right in submitting that the High Court has
not at all touched the merits of the case and
proceedings were not quashed on the ground that
the provisions of FERA do not apply to the case
before the Court. The High Court dealt with
only one point as to whether the proceedings
were liable to be quashed on the ground that
they were time-barred and upholding the
contention of the accused, passed the impugned
order. As we are of the view that the High
Court was not right in quashing the proceedings
on the ground of limitation, the order deserves
to be set aside by remitting the matter to the
Chief Metropolitan Magistrate, Mumbai to be
decided in accordance with law. We may,
however, clarify that it is open to the
respondents to take all contentions including
the contention as to applicability or otherwise
of FERA to the facts of the case. As and when
such question will be raised, the Court will
pass an appropriate order in accordance with
law.
31. For the foregoing reasons, the appeal
is allowed. The order passed by the High Court
is set aside and it is held that cognizance of
the offence had already been taken by the
competent Criminal Court i.e. Chief
Metropolitan Magistrate, Mumbai on May 24, 2002
and it could not be said that the proceedings
were barred by Section 49(3) of FEMA. The Chief
Metropolitan Magistrate will now proceed to
consider the matter in accordance with law. All
contentions of all parties are kept open except
the one decided by us in this appeal. Since the
matter is very old, the Court will give
priority and will decide it as expeditiously as
possible, preferably before June 30, 2008.
32. Ordered accordingly.