Pradeep S. Wodeyar vs The State of Karnataka

Code of Criminal Procedure, 1973 – s. 193 – Mines and Mineral (Development and Regulation) Act, 1957 – Karnataka Forest Rules, 1969 – Cognizance of the offence and not the offender – The Special Judge by an order mentions that cognizance is taken against the accused – Whether merely because the cognizance order mentions that cognizance is taken against the ‘accused’, the entire proceedings would be vitiated – Held : It is a settled principle of law that cognizance is taken of the offence and not the offender – However, the cognizance order indicates that the Special Judge has perused all the relevant material relating to the case before cognizance was taken – The change in the form of the order would not alter its effect – The order taking cognizance inadvertently mentioned that the Special Judge has taken cognizance against the accused instead of the offence – This would not vitiate the entire proceedings.

Mines and Mineral (Development and Regulation) Act, 1957 – Karnataka Forest Rules, 1969 – Code of Criminal Procedure, 1973 – ss. 193, 220 – Penal Code, 1860 – Cognizance by the Special Court of the offences under IPC – It was contended that even if the Special Judge had the power to take cognizance of the offence, he could only have taken cognizance of offences under the MMDR Act and could not have taken cognizance (and conduct trial) of the offences under the provisions of IPC – Held : Since offences under IPC are alleged to have been committed in the course of the same transaction as the offences under the MMDR Act, the situation is squarely covered by sub-section (1) of s.220 of CrPC – The Special Court has the power to take cognizance of offences under MMDR Act and conduct a joint trial with other offences if permissible u/s.

220 CrPC – There is no express provision in the MMDR Act which indicates that s.220 CrPC does not apply to proceedings under the MMDR Act.

Mines and Mineral (Development and Regulation) Act, 1957 – Karnataka Forest Rules, 1969 – Code of Criminal Procedure, 1973 – s. 193 – Cognizance order and non-application of mind – Allegations of purchasing and selling extracted iron ore illegally without mining dispatch permits and the payments of charges to the Mining and Geological Departments and the Forest Department – FIR registered and a final report u/s. 173 of Cr.P.C. submitted – Additional City and Civil Sessions Judge and Special Judge took cognizance after perusing the final report – It was contended that the order of the Special Judge taking cognizance has not sufficiently demonstrated application of mind to the material placed before him – Held : The Special Judge, took cognizance on the basis of a report submitted u/s. 173 CrPC and not on the basis of a private complaint – The Special Judge took note of the FIR, the witness statements, and connected documents before taking cognizance of the offence – In this backdrop, it would be far-fetched to fault the order of the Special Judge on the ground that it does not adduce detailed reasons for taking cognizance or that it does not indicate that an application of mind.

Mines and Mineral (Development and Regulation) Act, 1957 – s.22 – Karnataka Forest Rules, 1969 – Code of Criminal Procedure, 1973 – Allegations of purchasing and selling extracted iron ore illegally without mining dispatch permits and the payments of charges to the Mining and Geological Departments and the Forest Department – FIR registered and a final report u/s. 173 of Cr.P.C. submitted – Additional City and Civil Sessions Judge and Special Judge took cognizance after perusing the final report – Appellant contended that before the Special Court (Sessions Court) took cognizance of the offence, no complaint was filed by the authorised person – Held : A combined reading of the notifications dated 29 May 2014 and 21 January 2014 indicate that the Sub-Inspector of Lokayukta is an authorized person for the purpose of s.22 of the MMDR Act – The FIR that was filed to overcome the bar u/s. 22 has been signed by the Sub-Inspector of Lokayukta Police and the information was given by the SIT – Therefore, the respondent had complied with s.22 MMDR Act.

Mines and Mineral (Development and Regulation) Act, 1957 – s.23 – Karnataka Forest Rules, 1969 – Code of Criminal Procedure, 1973 – Vicarious liability – Allegations of purchasing and selling extracted iron ore illegally without mining dispatch permits and the payments of charges to the Mining and Geological Departments and the Forest Department – FIR registered and a final report u/s. 173 of Cr.P.C. submitted – Additional City and Civil Sessions Judge and Special Judge took cognizance after perusing the final report – It was contended that the charge- sheet does not ascribe any role to A-1 and hence the process initiated against him must be quashed – Held : The determination of whether the conditions stipulated in s.23 of the MMDR Act have been fulfilled is a matter of trial – Moreover, it is evident that the charge sheet, as a matter of fact, ascribes a role to A-1 and A-2 for the payment of transportation – Therefore, there is a prima facie case against A-1, which is sufficient to arraign him as an accused at this stage. Dismissing the appeals, the Court

HELD : Special Court’s power to take cognizance

1. Section 193 CrPC states that the Sessions Court shall not take cognizance of an offence as a Court of original jurisdiction unless the Magistrate commits the case to it. The only exception is if it is expressly provided otherwise by the Code or the statute. Neither the Code nor the MMDR Act provide that the Special Court could directly take cognizance of the offences. Therefore, the Sessions Court did not have the authority to take cognizance. [Para 34][1018-A-B]

Section 465 CrPC

2. Section 465 stipulates that the order passed by a Court of competent jurisdiction shall not be reversed or altered by a Court of appeal on account of an irregularity of the proceedings before trial or any inquiry. It is settled law that cognizance is pretrial or inquiry stage. Therefore, irregularity of a cognizance order is covered by the provision. In order to determine if the provision applies to pre-trial orders like an irregular cognizance order or only applies to orders of conviction or acquittal, it is necessary that the provision is interpreted contextually. [Para 37] [1019-D-E]

3. It needs to be determined if condoning the irregularity of the cognizance order under Section 465 would lead to a failure of justice. In considered opinion of this Court, it would not lead to a failure of justice for the following reasons :

(i) The diminished role of the committing Court under Section 209 of the new Code while committing the case to the Court of Session. Both the decision in Bhooraji as well as the subsequent decision in Ratiram notice that under the Code of 1898, the Magistrate had a broad power at the stage of committal which included the power to examine witnesses and to allow crossexamination. Such a power is noticeably absent in the provisions of Section 209 of the CrPC. On the contrary, Section 209 makes it abundantly clear that when a case is instituted on the basis of a police report or otherwise and it appears to the Magistrate that the offence is triable exclusively by the Court of Sessions, the Magistrate shall commit the case to the Court of Sessions after complying with the provisions of Section 207 or Section 208, as the case may be. The circumstance to which the Magistrate has to apply their mind is solely whether the offence is triable exclusively by the Court of Sessions. Since the committing Magistrate does not have wide discretionary powers to exercise at this stage not exercising it would not cause any injustice to the parties; (ii) Gradation in irregularity of cognizance order under Sections 460 and 461- Under Sections 460 and 461, the order taking cognizance based on a police report has been given a greater standing as compared to an order taking cognizance based on information received from any person other than a police officer or upon the own knowledge of the Magistrate, for the specific purpose of deciding on the irregularity of the order. The reason behind the gradation is because in the former case, the Magistrate has material based on an investigation by the police to ground his decision which may be absent when cognizance is taken based on information by any other person. In this case, cognizance was taken based on the SIT report. Therefore, the case squarely falls under Section 190(b) of CrPC which under Section 460, even if irregular would not vitiate the proceedings; (iii) Objective of the MMDR Act : The appellants are accused of the commission of offences under the MMDR Act involving the export and transportation of minerals without permit. Offences under the MMDR Act are environmental crimes. These crimes impact upon society at large. These offences cause a detriment to and affect the well-being of the entire community. Environmental crime is not confined within geographical or state limits. The impact of environmental crime transcends borders and time; (iv) The Preamble of the Act at the time of its enactment indicated that it is an Act for regulation of mines and the development of minerals. The ultimate object of the provision is to ensure that violators are punished by a speedy process of trial before a court duly constituted in that behalf; and (v) The delay in the commencement of trial : In the present case, there was considerable delay of two years. [Para 44][1023-E-H; 1024-A-G; 1025-H; 1026-B-C] Cognizance of the offence and not the offender

4. In the factual matrix before this Court, the Special Judge by an order dated 30 December 2015 referred to all the relevant material before him, including the FIR and witness statements, before taking cognizance. The question that arises is whether merely because the cognizance order mentions that cognizance is taken against the accused, the entire proceedings would be vitiated. The order taking cognizance inadvertently mentioned that the Special Judge has taken cognizance against the accused instead of the offence. This would not vitiate the entire proceedings, particularly where material information on the commission of the offence had been brought to the notice of and had been perused by the Special Judge. [Para 52] [1031-G-H; 1032-A-B]

Cognizance by the Special Court of offences under the IPC

5. Section 409 IPC deals with the offence of Criminal breach of trust by a public servant, banker, or agent, while Section 420 IPC deals with cheating. Since both these offences are alleged to have been committed in the course of the same transaction as the offences under the MMDR Act, the situation is squarely covered by sub-section (1) of Section 220 of CrPC. It now needs to be determined if Section 220 CrPC can be applied to proceedings before the Special Court constituted under the MMDR Act. [Para 58][1036-A-B]

6. Section 4(1) CrPC states that all offences under the IPC shall be investigated and tried according to the provisions contained in the CrPC. Section 4(2) states that all offences under any other law shall be investigated and tried according to the same provisions, subject to any other enactment that regulates the manner of investigation and trial. Section 5 states that nothing in the Code shall affect any special law that confers power, and jurisdiction, unless there is a specific provision to the contrary. Section 30C of the MMDR Act stipulates that unless otherwise provided by the Act, the CrPC shall apply to the proceedings before the Special Court. Therefore, on a combined reading of Sections 4 and 5 of CrPC along with Section 30C of the MMDR Act, it is apparent that the procedure prescribed under the Code shall be applicable to proceedings before the Special Court unless the MMDR Act provides anything to the contrary. These provisions incorporate the principle of express repeal – i.e., unless any provision of the CrPC is expressly repealed by the provisions of the MMDR Act, the procedure prescribed under the CrPC would apply to the proceedings before the Special Court. Since there is no express provision that excludes the application of Section 220 CrPC, it needs to be examined if the MMDR Act has by necessary implication excluded the application of Section

220 CrPC. [Paras 59, 60 and 62][1036-C-D, F-H; 1037-C-D]

7. The Judicial Magistrate First Class is invested with the authority to try offences under Sections 409 and 420 IPC. On the other hand, the Sessions Judge is appointed as a Special Judge for the purposes of the MMDR Act. If the offences under the MMDR Act and the IPC are tried together by the Special Judge, there arises no anomaly, for it is not a case where a judge placed lower in the hierarchy has been artificially vested with the power to try the offences under both the MMDR Act and the Code. Additionally, if the offences are tried separately by different fora though they arise out of the same transaction, there would be a multiplicity of proceedings and wastage of judicial time, and may result in contradictory judgments. It is a settled principle of law that a construction that permits hardship, inconvenience, injustice, absurdity and anomaly must be avoided. Section 30B of the MMDR Act and Section 220 CrPC can be harmoniously construed and such a construction furthers justice. Therefore, Section 30B cannot be held to impliedly repeal the application of Section 220 CrPC to the proceedings before the Special Court. [Para 67][1040-G-H; 1041-A-B]

Cognizance order and non-application of mind

8. The Special Judge, it must be noted, took cognizance on the basis of a report submitted under Section 173 CrPC and not on the basis of a private complaint. Therefore, the case is squarely covered by the decision in Afroz Mohammed Hasanfatta. The Special Judge took note of the FIR, the witness statements, and connected documents before taking cognizance of the offence. In this backdrop, it would be far-fetched to fault the order of the Special Judge on the ground that it does not adduce detailed reasons for taking cognizance or that it does not indicate that an application of mind. In the facts of this case, therefore, the order taking cognizance is not erroneous. [Para 75][1047-E-G] ‘Authorised person’ and Section 22 of MMDR Act

9. Section 22 of the MMDR Act stipulates that no Court shall take cognizance of any offence punishable under this Act or Rules, except upon a complaint made in writing by a person authorised on that behalf by the Central or the State Government. It has been contended by the appellant that before the Special Court (Sessions Court) took cognizance of the offence, no complaint was filed by the authorised person. [Para 76] [1047-G-H; 1048-A]

10. The Government of Karnataka issued a notification on

29 May 2014 declaring that the Office of the Inspector General of Police, Special Investigation Team, Karnataka Lokayukta shall be a police station for the purpose of Section 2(s) and shall have jurisdiction throughout the State of Karnataka for offences related to the illegal mining of minerals. The FIR was filed by the SIT, Lokayukta pursuant to the Order of this Court dated 16 September 2013 and was signed by the Sub-inspector of Police, Karnataka Lokayukta. On a reading of the notification dated 29 May 2014, it is evident that the SIT has the jurisdiction throughout Karnataka in relation to mining offences. S.No. 13 of the Notification dated 21 January 2014 authorizes the Sub- inspector of Police‘ within its jurisdiction for the purpose of Section 22 of the MMDR Act. Therefore, on a combined reading of both the notifications, it is clear as day light that the complaint filed by SIT and signed by the Sub-Inspector of Police has complied with Section 22 of the MMDR Act. [Para 80][1052-H; 1053-A-C]

Vicarious liability and Section 23 of MMDR Act

11. A-1 submitted that the charge-sheet does not ascribe any role to A-1 and hence the process initiated against him must be quashed. Section 23(1) of the MMDR Act stipulates that where the offence has been committed by a company, every person who at the time of the commission of the offence was in-charge of and responsible for the conduct of business shall be deemed to be guilty of the offence. The proviso stipulates that nothing contained in sub-section (1) shall render such a person liable to punishment, if he proves that the offence was committed without his knowledge or that he exercised all due diligence of preventing the commission of the offence. [Para 82][1054-E-F]

12. The test to determine if the Managing Director must be charged for the offence committed by the Company is to determine if the conditions in Section 23 of the MMDR Act have been fulfilled i.e., whether the individual was in-charge of and responsible for the affairs of the company during the commission of the offence. In view of the above decisions, the submissions which has been urged on behalf of the appellant cannot be acceded to. The determination of whether the conditions stipulated in Section 23 of the MMDR Act have been fulfilled is a matter of trial. Moreover, it is evident that the charge sheet, as a matter of fact, ascribes a role to A-1 and A-2 for the payment of transportation. Therefore, there is a prima facie case against A1, which is sufficient to arraign him as an accused at this stage. [Para 84][1056-C-E]

13. The findings of the Court are summarised as below:

(i) The Special Court does not have, in the absence of a specific provision to that effect, the power to take cognizance of an offence under the MMDR Act without the case being committed to it by the Magistrate under Section 209 CrPC. The order of the Special Judge dated 30 December 2015 taking cognizance is therefore irregular; (ii) The objective of Section

465 is to prevent the delay in the commencement and completion of trial. Section 465 CrPC is applicable to interlocutory orders such as an order taking cognizance and summons order as well. Therefore, even if the order taking cognizance is irregular, it would not vitiate the proceedings in view of Section 465 CrPC;

(iii) The decision in Gangula Ashok was distinguished in Rattiram based on the stage of trial. This differentiation based on the stage of trial must be read with reference to Section 465(2) CrPC. Section 465(2) does not indicate that it only covers challenges to pre-trial orders after the conclusion of the trial. The cardinal principle that guides Section 465(2) CrPC is that the challenge to an irregular order must be urged at the earliest. While determining if there was a failure of justice, the Courts ought to address it with reference to the stage of challenge, the seriousness of the offence and the apparent intention to prolong proceedings, among others; In the instant case, the cognizance order was challenged by the appellant two years after cognizance was taken. No reason was given to explain the inordinate delay. Moreover, in view of the diminished role of the committal court under Section 209 of the Code of 1973 as compared to the role of the committal court under the erstwhile Code of 1898, the gradation of irregularity in a cognizance order made in Sections

460 and 461 and the seriousness of the offence, no failure of justice has been demonstrated; (iv) It is a settled principle of law that cognizance is taken of the offence and not the offender. However, the cognizance order indicates that the Special Judge has perused all the relevant material relating to the case before cognizance was taken. The change in the form of the order would not alter its effect. Therefore, no failure of justice under Section 465 CrPC is proved. This irregularity would thus not vitiate the proceedings in view of Section 465 CrPC; (v) The Special Court has the power to take cognizance of offences under MMDR Act and conduct a joint trial with other offences if permissible under Section 220 CrPC. There is no express provision in the MMDR Act which indicates that Section 220 CrPC does not apply to proceedings under the MMDR Act; (vi) Section 30B of the MMDR Act does not impliedly repeal Section 220 CrPC. Both the provisions can be read harmoniously and such an interpretation furthers justice and prevents hardship since it prevents a multiplicity of proceedings; (vii) Since cognizance was taken by the Special Judge based on a police report and not a private complaint, it is not obligatory for the Special Judge to issue a fully reasoned order if it otherwise appears that the Special Judge has applied his mind to the material; (viii) A combined reading of the notifications dated

29 May 2014 and 21 January 2014 indicate that the Sub-Inspector of Lokayukta is an authorized person for the purpose of Section

22 of the MMDR Act. The FIR that was filed to overcome the bar under Section 22 has been signed by the Sub-Inspector of Lokayukta Police and the information was given by the SIT. Therefore, the respondent has complied with Section 22 CrPC; and (ix) The question of whether A-1 was in-charge of and responsible for the affairs of the company during the commission of the alleged offence as required under the proviso to Section 23(1) of the MMDR Act is a matter for trial. There appears to be a prima facie case against A-1, which is sufficient to arraign him as an accused at this stage. [Para 85][1056-F-H; 1057-A-H; 1058-A-E]

Dharam Pal v. State of Haryana, a Constitution Bench (2014) 3 SCC 306 : [2013] 13 SCR 1052 – followed. Rattiram v. State of Madhya Pradesh (2012) 4 SCC 516 : [2012] 3 SCR 496; Kishun Singh v. State of Bihar (1993) 2 SCC 16 : [1993] 1 SCR 31; Municipal

Council, Palai v. T.J Joseph AIR 1963 SC 1561 : [1964] SCR 87; Harshad Mehta v. State of

Maharashtra (2010) 8 SCC 257; Pepsi Foods Ltd. v. Special Judicial Magistrate (1998) 5 SCC 749 : [1997]

5 Suppl. SCR 12; State (NCT of Delhi) v. Sanjay (2014)

9 SCC 772 : [2014] 9 SCR 1063; SMS Pharmaceuticals v. Neeta Bhalla (2005) 8 SCC 89 : [2005] 3 Suppl. SCR 371; Mainuddin Abdul Sattar Shaikh v. Vijay D Salvi (2015) 9 SCC 622 : [2015] 6 SCR 1033 – relied on.

Gangula Ashok v. State of AP (2000) 2 SCC 504 : [2000]

1 SCR 468; State of MP v. Bhooraji (2001) 7 SCC 679 : [2001] 2 Suppl. SCR 128; Moly v. State of Kerala (2004) 4 SCC 584 : [2004] 3 SCR 346; Vidyadharan v. State of Kerala (2004) 1 SCC 215 : [2003] 5 Suppl. SCR 524; Shantaben Bhurabhai Bhuriya v. Anand Athabhai Chaudhari, Criminal Appeal No. 967 of 2021; Hardeep Singh v. State of Punjab, (2014) 3 SCC 92 : [2014] 2 SCR 1; AR Antulay v. RR Nayak, 1988 AIR 1531 : [1988] 1 Suppl. SCR 1; Santhosh De v. Archana Guha AIR 1994 SC 1229 : 1994 (3) Suppl. SCC 735; Anna Reddy Sambvisa Reddy v. State of A.P, AIR 2009 SC 2661 : [2009] 6 SCR 755; Chief Enforcement Officer v. Videocon International Ltd., (2008) 2 SCC

492 : [2008] 2 SCR 36; Fakhruddin Ahmad v. State of Uttaranchal, (2008) 17 SCC 157 : [2008] 13 SCR 66; State of W.B. v. Mohd. Khalid (1995) 1 SCC 684 : [1994]

6 Suppl. SCR 16; Ranjit Singh v. State of Punjab (1998)

7 SCC 149 : [1998] 2 Suppl. SCR 8; RN Agarwal v. RC BansaL (2015) 1 SCC 48 : [2014] 14 SCR 1124;

Harshad Mehta v. State of Maharashtra, (2010) 8 SCC 257; State of Orissa v. M/s M.A. Tulloch, AIR 1964 SC 1284 : [1964] SCR 461; Syndicate Bank v. Prabha D. Naik, (2001) 4 SCC 713 : [2001] 2 SCR 714; State of MP v. Kedia Leather & Liqour Limited, (2003) 7 SCC

389 : [2003] 2 Suppl. SCR 727; Lal Shah Baba Dargah Trust v. Magnum Developers, (2015) 17 SCC 65 : [2015]

10 SCR 966; Deep Chand v. State of Uttar Pradesh (1959) 2 SCR 8; Fakhruddin Ahmad v. State of

Uttaranchal (2008) 17 SCC 157 : [2008] 13 SCR 66; Mehmood Ul Rehman v. Khazir Mohammad Tunda

(2015) 12 SCC 420 : [2015] 4 SCR 841; Sunil Bharti Mittal v. CBI (2015) 4 SCC 609 : [2015] 1 SCR 377; Ravindranatha Bajpe v. Bangalore Special Economic Zone Ltd Criminal Appeal Nos. 1047-1048/2021; Bhushan Kumar v. State (NCT of Delhi) (2012) 5 SCC

424 : [2012] 2 SCR 696; State of Gujarat v. Afroz Mohammed Hasanafatta (2019) 20 SCC 539; Kanwar Pal Singh v. The State of Uttar Pradesh (2020) 14 SCC

331 : 2019 (12 ) JT 420; Jayant v. The State of Madhya Pradesh (2021) 2 SCC 670; 2020 (12 ) JT 52; Shiva Kumar Jatia v. NCT of Delhi (2019) 17 SCC 193 : [2019]

11 SCR 210; Sunil Sethi v. State of Andhra Pradesh (2020) 3 SCC 240; Ravindranatha Bajpe v. Mangalore Special Economic Zone Ltd. 2021 SCC OnLine 806 – referred to.