IN THE HIGH COURT OF KERALA AT ERNAKULAM
Crl MC No. 3010 of 2003()
1. T.KUNHI MOOSA,
... Petitioner
Vs
1. STATE OF KERALA,
... Respondent
2. SALES TAX INSPECTOR,
For Petitioner :SRI.T.M.ABDUL LATHEEF
For Respondent :PUBLIC PROSECUTOR
The Hon'ble MR. Justice V.K.MOHANAN
Dated :22/02/2008
O R D E R
V.K.MOHANAN, J.
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Crl.M.C.No. 3010 of 2003
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Dated this the 22nd day of February, 2008
O R D E R
The petitioner, who is the first accused in
Crime No.59 of 2003 of the Thalassery Police Station,
preferred this Crl.M.C. with a prayer to quash all
proceedings in the above crime in which the offence
alleged is under Section 420 of the Indian Penal Code
(hereinafter referred to only for short as ‘the I.P.C.’).
According to the petitioner, no offence under Section 420
of the I.P.C. is attracted against him even if the entire
prosecution case is admitted as true and therefore, the
very registration of the above crime and all proceedings
thereon are really abuse of process of law.
2. The allegation against the petitioner is that on
25.1.2003, the departmental officers had intercepted
Lorry No.KL-11 E-9759 at about 23.15 Hrs. at New Mahe
and found that the vehicle carries invoice raised in the
name of Pondicherry Spices, Chalakkara, for the sale of
90 bags of pepper amounting to Rs.1,80,000/- vide invoice
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Nos.32 & 33 to Delhi. Besides the invoice, the driver
carries Form 27C Transit Pass for getting Transit Pass,
declaration in 27 B etc. According to the prosecution,
on physical verification of the goods under transport in
the lorry, it is noted that, it carries 63 bags of unsaleable
pepper waste and even not a single bag ‘bold pepper’ is
seen transporting in the lorry. Thus, on interrogation of
the driver, cleaner and the headload worker available in
the lorry, it came out that 63 bags, containing waste
pepper, are loaded from a house nearer to Mahe-
Thalassery road and the vehicle was then taken to
Chalakkara area and from there, the writer gave invoice
to the driver to be produced before the Check Post
Official for getting Transit Pass etc. It is also revealed
through interrogation that directions were given to the
driver that on getting Transit Pass from Check Post
Officials, the lorry is to be taken to Iritty from where the
waste pepper loaded in the lorry are to be replaced by
bold pepper for onward transport to outside Kerala on
the strength of Mahe Invoice along with Transit Pass
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obtained from the Check Post Officials. Later, the
vehicle along with the goods was taken custody by the
Check Post officials for further action.
3. According to the prosecution, the above
instance clearly shows the modus operandi practised by
the petitioner in smuggling pepper for evading payment
of tax. It is the case of the prosecution that the
petitioner/accused procured pepper, supari etc. from
pepper and supari cultivated areas like Iritty, Irikkur,
Sreekandapuram, Kanhangad, Kasaragod etc. and stored
in some undisclosed go downs there. Further, the
allegation is that, at the very same time, in Chalakkara,
the vehicles were loaded with unsaleable waste pepper
and such other waste goods and they were transported
along with invoices raised by Pondicherry Spices,
Chalakkara and on reaching the Check Post on producing
the Mahe invoice, fraudulently obtain Transit Pass and on
getting Transit Pass, the vehicle with waste pepper was
driven to place where bold pepper is stored and
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replaced the pepper waste with bold pepper for onward
transport to outside Kerala, through border check post.
It is the definite case of the prosecution that by adopting
this mode of operation, the petitioner had transported
more than 1564 bags of pepper and 80 bags of Supari
procured from Kannur and Kasaragod area and evaded
payment of tax which are legitimately payable for the
Government, by fraudulently obtaining Transit Pass on
the strength of Mahe invoice. Therefore, according to
the prosecution, the petitioner along with others
committed the offence punishable under Section 420
read with Section 34 of the I.P.C. Based upon the First
Information Statement given by one C.G.Mathew, Sales
Tax Inspector, Sales Tax Checkpost, New Mahe before
the Sub Inspector of Police, Thalassery Police Station,
Crime No.59 of 2003 has been registered for the above
offences implicating the petitioner as first accused and
there are altogether four accused in the petition.
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4. The petitioner approached this Court when
the investigation was in the infant stage. It appears that
the above Crl.M.C. dated 9.4.2003 was moved before
this Court on 11.4.2003 and thereafter, the matter was
being adjourned continuously and no stay was granted
although Crl.M.P.No.3684 of 2003 was filed for staying
all further proceedings in Crime No.59 of 2003 including
the laying of final report after investigation. By order
dated 31.3.2006, this Court had made clear that it is
open to the Police to proceed with the investigation of
the case. Thus, the investigation in the above case is
already over and a final report has already been filed
before the court below and accordingly, C.C.No.417 of
2004 is instituted. It is the above case and proceedings
are being sought to be quashed.
5. The main contention raised in this case is that
no offence under Section 420 of the I.P.C. is disclosed
against the petitioner, even if the entire allegation is
admitted as true. According to the petitioner, there is
no tax evasion and he had not deprived of any property
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of the Government and unless and until there is specific
property which was transported without paying tax,
Section 420 will not be attracted. It is also contended
that the liability comes only when there is a proper
adjudication by the assessing authority and even in that
case, if the finding is against the assessee, the matter
can be taken in appeal and therefore, according to the
petitioner, Section 420 will not come into play.
Therefore, according to the petitioner, the registration
of crime against the petitioner for the offence under
Section 420 is unjust and illegal. Along with Crl.M.C.,
the petitioner has produced Annexure-A1 which is a
copy of the explanation submitted by the petitioner to a
notice issued by the Sales Tax Authority. Another
document is Annexure A-2 which is a copy of the
assessment proceedings initiated against the petitioner
by the Assistant Commissioner (Assessment),
Commercial Taxes, Special Circle, Kannur. On the
strength of the above document, the contention of the
petitioner is that even according to the Department, the
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only allegation against him is infringement of certain
statutory provisions for which concerned authority has
already initiated statutory proceedings. By producing
Annexure A3 document, which is an order by the
Session’s Court, Thalassery in Crl.M.C.No.269 of 2003
by which anticipatory bail was granted in favour of him
and in the above order, it is submitted that the Session’s
Court has observed that the case diary shows that the
investigation is in progress and so far, they could not
ascertain whether the criminal prosecution will lie in
respect of the evasion of tax. Thus, based upon the
above document, the petitioner submitted that at any
rate, no offence under Section 420 of the I.P.C. will lie
against the petitioner and therefore, prayed for
quashing the entire proceedings.
6. I have heard Mr.Abdul Latiff, learned counsel
appearing for the petitioner as well as the learned Public
Prosecutor.
7. Learned counsel for the petitioner submits
that even if the entire allegation is admitted as true, no
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offence under Section 420 of I.P.C. will attract against
the petitioner. According to counsel, no goods have
been seized from the vehicle which was subjected for
inspection on the date of occurrence and therefore, even
the prosecution has no case that the petitioner has tried
to transport goods without paying the tax due to the
Government and the petitioner has tried to evade from
paying the tax. The learned counsel strenuously argued
that by the alleged incident, the petitioner has not
caused any loss to the Government. In the absence of
any such allegation, no offence under Section 420 of the
I.P.C. will lie against the petitioner. The learned counsel
took me through Section 415 which reads as follows:-
“415. Cheating.– Whoever, by
deceiving any person, fraudulently or
dishonestly induces the person so deceived
to deliver any property to any person, or to
consent that any person shall retain any
property, or intentionally induces the person
so deceived to do or omit to do anything
which he would not do or omit if he were not
so deceived, and which act or omission causes
or is likely to cause damage or harm to that
person in body, mind, reputation or property
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is said to “cheat”.
Explanation.–A dishonest concealment
of facts is a deception within the meaning of
this section.”
According to counsel for the petitioner, unless it is
specifically alleged or pleaded that the petitioner has
obtained a Transit Pass, and by using such Transit Pass,
the petitioner had transported goods without paying tax,
no offence under Section 420 will lie against the
petitioner. The counsel for the petitioner has also
invited my attention to the ingredients of Sections 415
and 420 of the I.P.C. in support of the above contention.
8. The learned counsel for the petitioner cited a
decision of the Apex Court reported in Hari Sao v.
State of Bihar (AIR 1970 SC 843) in support of the
above contention. In the above decision, the Apex Court
had held that the false representation made by the
appellants in obtaining the railway receipt in the form in
which it was issued did not cast any additional liability
on the railway and the issue of the railway receipt
therefore was not likely to cause any damage or harm to
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the railway. It was also held that no question of
cheating the railway or the Station Master therefore
arose in the above case.
9. On the strength of the above decision, the
counsel for the petitioner submits that in the present
case, even according to the prosecution, the case is that
there is only an attempt from the part of the petitioner
for the evasion of tax even at the time of producing the
declaration for obtaining the Transit Pass. If that be so,
therefore, the ingredients of Sections 415 or 420 have
not so far been disclosed and hence all proceedings
initiated against the petitioner are clear abuse of
process of law.
10. In this juncture, it is relevant to note that
Annexure A-4 is the F.I.R. in Crime No.59/03 of
Thalassery Police Station. Along with Annexure A-4
F.I.R., the petitioner has produced the seizure Mahazar.
Besides the above document along with Crl.M.C., the
petitioner has also produced Annexure A2 which is a
copy of the assessment order wherein after giving the
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brief allegation against the petitioner, the authority has
provisionally shown the proposed assessment against
the petitioner for the period from April, 2002 to January,
2003 and thus the total taxable turn over proposed is
fixed as Rs.70 lakhs. In Annexures A2 document as well
as A4 F.I.R., the allegation is to the effect that in
Chalakkara, the vehicles were loaded with unsaleable
pepper waste and such waste goods and transported the
same along with invoices raised by the Pondicherry
Spices, Chalakkara and on reaching the Check Post and
on producing the Mahe Invoice, fraudulently obtain
Transit Pass and on getting Transit Pass, waste pepper
were driven to places where bold pepper is stored and
replaced the pepper waste with bold pepper for onward
transport to outside Kerala through Border Check Post.
It is also clear from the above words which runs “through
this modus operandi, he had transported more than 1564 bags of
Pepper and 80 bags of Supari procured from Kannur and Kasaragod
area and evaded payment of tax legitimately due to Government by
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fraudulently obtaining transit pass on the strength of Mahe
invoice.” In the present case, it is the stand of the
prosecution that when the petitioner with the vehicle
approached the Check Post, the vehicle was intercepted
on the basis of Intelligence Report even before obtaining
the Transit Pass. So the prosecution is specific that even
before obtaining the Transit Pass, they intercepted. If
that be so, it cannot be said that any of the ingredients
of Section 415 or 420 of I.P.C. is attracted. Of course,
there may be violation of other statutory provisions for
which the concerned authority has already initiated
proceedings as evidenced by the documents produced by
the petitioners. That does not mean that on the basis of
the present set of averments, an offence under Section
420 is disclosed. It appears that the date of occurrence
as alleged is 25.1.2003 and thereafter, more than five
years are over and so far, there is no progress in the
trial and especially in the absence of sufficient factual
averments and allegations so as to constitute the offence
under Section 420 of I.P.C., there is no meaning in
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directing the petitioner to undergo the ordeal of trial,
especially in a case where there is no scope for
conviction. Therefore, I am of the view that the
registration of the crime and all further proceedings
thereon including the investigation and the subsequent
institution of Calendar Case in Crime No.59 of 2003 of
Thalassery Police Station is a clear abuse of process of
court and for the ends of justice, it is absolutely
inevitable to quash all the proceedings thereon.
11. In the result, this Crl.M.C. is allowed
quashing Annexure A4 F.I.R. and the final report and
C.C.No.417 of 2004 instituted thereon and pending in
the Court of the Judicial First Class Magistrate’s court,
Thalassery.
V.K.Mohanan,
Judge
Mbs/
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V.K.MOHANAN, J
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Crl.M.C.NO. 3010 OF 2003
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O R D E R
DATED: 22-2-2008
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