Court on Its Own Motion v. Zenith Mining Pvt Ltd & Anr

1. This hearing has been done through hybrid mode. CM APPL. 2818/2015 in CONT.CAS(C) 147/2012

2. This is an application filed on behalf of Applicant - Mr. Mohd. Javed Sultan, seeking review/recall of the order dated 5th August, 2013 by which this Court had directed the worthy Registrar General to file a suitable complaint to the Court competent to exercise the jurisdiction in respect of offences under Section 193 of IPC read with the procedure laid down in Section 195(1)(b) of Cr.P.C. as against M/s Zenith Mining Pvt. Ltd. (hereinafter “Zenith”), as also Mr. Syed Najam Ahmed and Mr. Mohd. Javed Sultan, who were the Chairman & Managing Director, and CEO of Zenith, respectively, at the relevant time. The operative portion of the said order reads as under: “4. The materials on record indicate that the 16:15 original of the letter dated 12.08.2004 is not on the record in any proceedings. It was not made part of the record nor even adverted to at any stage when NAFED approached the Court, in any of the replies or pleadings relied upon by Zenith. The explanation now sought to be given by one of the respondents is that a copy of the letter itself became available sometime at the end of December, 2008 and was consequently relied upon in appellate proceedings. This Court has by its order of 21.01.2010 taken a prima facie view that the letter appears to have been fabricated and was not on the record; it does not also appear to have been a part of any correspondence contemporaneously exchanged between NAFED and Zenith or any of the officials.

5. On the appropriate procedure to be adopted, the Constitution Bench’s judgment in Iqbal Singh Marwah & Anr. v. Meenakshi Marwah & Anr. 2005 (4) SCC 370 stated as follows:- “"9. The scheme of the statutory provision may now be examined. Broadly, Section 195 Cr.P.C. deals with three distinct categories of offences which have been described in clauses (a), (b)(i) and (b)(ii) and they relate to (1) contempt of lawful authority of public servants, (2) offences against public justice, and (3) offences relating to documents given in evidence. Clause (a) deals with offences punishable under Sections 172 to 188 IPC which occur in Chapter X of the IPC and the heading of the Chapter is 'Of Contempts Of The Lawful Authority Of Public Servants'. These are offences which directly affect the functioning of or discharge of lawful duties of a public servant. Clause (b)(i) refers to offences in Chapter XI of IPC which is headed as 'Of False Evidence And- Offences Against Public Justice'. The offences mentioned in this clause clearly relate to giving or fabricating false evidence or making a false declaration in any judicial proceeding or before a 16:15 Court of justice or before a public servant who is bound or authorized by law to receive such declaration, and also to some other offences which have a direct co-relation with the proceedings in a Court of justice (Sections 205 and 211 IPC). This being the scheme of two provisions or clauses of Section 195, viz., that the offence should be such which has direct bearing or affects the functioning or discharge of lawful duties of a public servant or has a direct correlation with the proceedings in a court of justice, the expression "when such offence is alleged to have been committed in respect of a document produced or given in evidence in a proceeding in a Court" occurring in clause (b)(ii) should normally mean commission of such an offence after the document has actually been produced or given in evidence in the Court. The situation or contingency where an offence as enumerated in this clause has already been committed earlier and later on the document is produced or is given in evidence in Court, does not appear to be in tune with clauses (a)(i) and (b)(i) and consequently with the scheme of Section 195 Ст.Р.С. This indicates that clause (b)(ii) contemplates a situation where the offences enumerated therein are committed with respect to a document subsequent to its production or giving in evidence in a proceeding in any Court.

10. Section 195(1) mandates a complaint in writing of the Court for taking cognizance of the offences enumerated in clauses (b) (i) and (b)(ii) thereof. Sections 340 and 341 Cr.P.C. which occur in Chapter XXVI give the procedure for filing of the complaint and other matters connected therewith. The heading of this Chapter is -’Provisions As To Offences Affecting The Administration Of Justice'. Though, as a general rule, the language employed in a heading cannot be used to give a different 16:15 effect to clear words of the Section where there cannot be any doubt as to their ordinary meaning, but they are not to be treated as if they were marginal notes or were introduced into the Act merely for the purpose of classifying the enactments. They constitute an important part of the Act itself, and may be read not only as explaining the Sections which immediately follow them, as a preamble to a statute may be looked to explain its enactments, but as affording a better key to the constructions of the Sections which follow them than might be afforded by a mere preamble (See Craies on Statute Law, 7th Ed. Pages 207, 209). The fact that the procedure for filing a complaint by Court has been provided in Chapter XXVI dealing with offences affecting administration of justice, is a clear pointer of the legislative intent that the offence committed should be of such type which directly affects the administration of justice, viz., which is committed after the document is produced or given in evidence in Court. Any offence committed with respect to a document at a time prior to its production or giving in evidence in Court cannot, strictly speaking, be said to be an offence affecting the administration of justice."

6. This Court is of the opinion that the material on record are such that it would be expedient in the interest of justice that a suitable complaint is made by the Registrar General of this Court to the Court competent to exercise jurisdiction in respect of offences under Section 193 IPC read with the procedure indicated in Section 195 (1) (b) of the Cr.P.C as against the respondent Zenith, Syed Najam Ahmed and Mohd. Javed Sultan. The Registrar General shall take appropriate action in this regard within four weeks.” 16:15

3. The background of the present case is recorded in the order dated 5th August, 2013. In brief, the facts of the case are that National Agricultural Cooperative Marketing Federation of India Ltd. (hereinafter “NAFED”) had claimed that Zenith owed it a sum of Rs. 89 Crores. This claim was disputed by Zenith, and pursuant to the arbitration clause in the agreement between the parties, NAFED sought interim measures under Section 9 of the Arbitration and Conciliation Act, 1996, in the form of directions for securing the aforesaid amount due.

4. On 25th November, 2008, the ld. Single Judge on a prima facie view of the dispute, directed Zenith, inter alia, to deposit Rs. 4,50,000/- every month in the Court to secure the aforesaid claim of NAFED. This order was challenged by Zenith in FAO (OS) 495/2008 that was disposed of vide order dated 17th December, 2024. The Division Bench while disposing the said appeal also noted that there was no dispute as to the existence of the liability to the tune of Rs. 89 Crores of Zenith towards NAFED. Thereafter, the ld. Single Judge finding Zenith to have failed to comply with the directions passed in order dated 25th November, 2008, restrained Zenith and its personnel, from alienating, mortgaging and/or creating any third party interest on the properties mentioned in the said order. Certain bank accounts of Zenith were also attached vide the said order.

5. The said order of attachment dated 25th November, 2008 was challenged by Zenith in FAO (OS) 228/2009, which was first listed on 29th May, 2009, and it records the submission of the ld. Counsel for Zenith that as against the demand of Rs. 81 Crores, Zenith has already paid Rs. 91 Crores. However, ld. Counsel for Zenith sought time to place on record proof of payments to support the said submission. Accordingly, an additional affidavit 16:15 was filed on behalf of Zenith providing the requisite proof.

6. On 21st January 2010, the ld. Counsel appearing on behalf of Zenith took the Court through the said additional affidavit, wherein, a letter dated 12th August, 2004, was annexed as Annexure P-12. The said letter was relied upon in support of the submission that Zenith had supplied 1,20,000 metric tonnes of iron ore fines to NAFED which is allegedly valued at Rs. 25 Crores. The said letter bore the signature and stamp of NAFED, as also an endorsement of ‘received letter’. However, the said letter as also the supply of iron ore fines, was refuted by the NAFED, and it was argued that the said letter is forged and fabricated.

7. The Division Bench after analysing the facts of the case and considering the documents on record, had prima facie found that the letter dated 12th August, 2004 was fabricated. The Court dismissed the said appeal and issued show cause notice to the appellants therein i.e., Zenith and Mr. Syed Najam Ahmed. The relevant paragraphs of the said order are reproduced herein under:

16:15 ‘received letter’ is filed as Annexure P-12 to the affidavit. The counsel for the respondent No.1 has controverted the said document and/or receipt of the said quantity of iron ore fines and has contended that the said document has been forged and fabricated.

5. We take a serious view of such a practice if found to have been followed by the appellants. Since what has been filed before this court as Annexure P-12 is a photocopy, we enquired from the senior counsel for the appellants as to where the original was and as to who has signed the same on behalf of the appellant No.1 and on behalf of the respondent No.1. He, on instructions states that the appellants are not in possession of the original; it is stated to be signed by the then CEO of the appellant No.1 company; the name or designation of the officer of the respondent No.1 who has purported to sign the same is not disclosed. It is further informed that the appellant No.2 who is the CMD of the appellant No.1 company had received a fax from the then CEO; it is further stated that a copy of the said letter was also handed over by the officials of the respondent No.1 in meetings with the appellant No.2; however the counsel is unable to give the exact date of the said meetings.

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8. We are not satisfied of the appellants having paid approximately Rs.25 crores to the respondent No.1 in the manner aforesaid. It is inconceivable that if a large sum of Rs.25 crores had been paid as aforesaid as far back as in 2004, mention thereof would not have been made before this court at the initial stage of the proceedings and/or in the arbitration proceedings. We are also not satisfied with the explanation given with respect to the document. It is inconceivable that goods of the value of Rs.25,12,00,000/- would have been 16:15 handed over in the manner aforesaid. The endorsement on the photocopy of the letter filed is only of a receipt of the letter and not even of the goods. No particulars of the officer of the respondent No.1 to whom goods of such high value were handed over is forthcoming. There is no other proof whatsoever of such transaction and which is highly unlikely. We are thus prima facie of the opinion that the appellant has forged and fabricated the document filed as Annexure P-12 for use in the present proceedings and has made false representation to this court on 29th May, 2009 of payment of Rs.91 crores to the respondent No.1. The appeal is liable to be dismissed on this ground alone.