Sohan Lal Juneja and others v. State of Punjab

Case Details & Bench

Court: High Court
Hon'ble Judges: Arijit Pasayat
Lokeshwar Singh Pant
Judgment Date: 2006-11-09
Court Decision / Holding: The High Court's orders are set aside and the matter remitted to the High Court for fresh consideration in light of the principles in Adri Dharan Das and Bal Kishan Das; appeal disposed of.
Final Disposition: Appeal disposed of; matter remitted to High Court for fresh consideration in light of key precedents and principles.

Parties to the Case

Appellants / Petitioners

Sohan Lal Juneja and others

Respondents

State of Punjab

Legal Representation & Advocates

Counsels for Petitioners

• R.K. Talwar
• S.L. Aneja

Counsels for Respondents

• Arun K. Sinha

Case Synopsis & Summary

This appeal concerns the grant of anticipatory bail under Section 438 Cr.P.C. in a case of alleged misappropriation of stock. The Punjab and Haryana High Court had granted interim protection to the appellants on the condition that Rs 10,00,000 be deposited with Markfed, the complainant. When the amount was not deposited, the High Court refused the protection; the order was challenged in this Court. The appellants argued that the proceedings stem from a contractual dispute with civil/arbitration overtones and that the deposit condition of such a large sum is unwarranted and inconsistent with the scope of Section 438. They relied on Bal Kishan Das v. P.C. Nayar (1991) and that the decision undermines the prophylactic criminal process. The State contended that the loss to the complainant was substantial due to a conspiracy and that criminal proceedings can proceed despite arbitration; the deposit serves to protect the complainant. The Supreme Court held that the High Court failed to consider the relevant aspects and did not provide reasons for the deposit, and that the ambit of Section 438 must be understood in light of Adri Dharan Das v. State of W.B. and Bal Kishan Das. The Court set aside the High Court orders and remitted the matter for fresh consideration, directing the High Court to apply these principles.

Provisions of Law Cited

Code of Criminal Procedure, 1973, Section 438

Legal Doctrines & Maxims

Principles relating to Section 438 Cr.P.C., as laid down in Adri Dharan Das v. State of W.B., 2005 (4) SCC 303; Bal Kishan Das v. P.C. Nayar, 1991 (Supp.2) SCC 412

Submissions & Arguments

Contentions of Appellants / Petitioners

The appellants argued that the High Court's order directing deposit of Rs. 10,00,000/- under Section 438 Cr.P.C. is not sustainable in law in light of Bal Kishan Das and that the matter essentially concerns civil/arbitration disputes; the scope of Section 438 should be interpreted broadly and the deposit condition requires cogent reasons.

Contentions of Respondents

The State contended that a substantial loss was caused by a conspiracy and that, despite arbitration proceedings, criminal proceedings may proceed; deposit of a large sum protects the complainant; thus the High Court's order was justified.

Cited Precedents (2)

Case Name	Citation	Treatment	Explanation
Bal Kishan Das v. P.C. Nayar	[1991] Suppl. 2 SCC 412	Positive	Relied upon to outline the governing principles under Section 438 Cr.P.C. and to guide whether deposit conditions are appropriate.
Adri Dharan Das v. State of W.B.	(2005) 4 SCC 303	Positive	Cited to guide the interpretation of Section 438 Cr.P.C. and its ambit in the instant matter.

Extracted Judgment Text

Exact text extracted from official judgment records.

A ## SOHAN LAL JUNEJA AND ORS. ## _v._ ## STA TE OF PUNJAB ## B ## NOVEMBER 9, 2006 [ARIJIT PASA Y AT AND LOKESHW AR SINGH PANT A, JJ.] _Code of Criminal Procedure, 1973-Section 438-Jmposition of_ C _condition of deposit of Rs. JO lacs by High Court for granting interim protection in terms of Section 438-Non-deposit of amount as directedInterim protection denied-On appeal, held: High Court had not considered relevant aspects and also not indicated reason/or imposing such conditionHence, matter remitted back for fresh consideration._ D Complainant filed an FIR against appellants and others for their alleged involvement in misappropriatiop of stock. The High Court granted interim protection in terms of Section 438 Cr.P.C. on the condition. of deposit of Rs.10,00,000/- with the complainant. Subsequently because of non-deposit of the amount as directed, the protection was denied and prayer in terms of Section 438 Cr.P.C. was rejected. E In appeal to this Court, appellant contended that in view of the decision of this Court in _*Bal Kishan Das_ case, the proceedings arc not maintainable and the condition of depositing a huge sum of Rs.l 0,00,000/- as directed by the High Court cannot stand scrutiny in law. F Disposing of the appeal and remitti~g the matter to High Court, the Court HELD: 1.1. While dealing with the matter, the High Court shall keep in view the principles indicated by this Court relating to Section 438 in _**Adri_ G _Dharan Das'_ case and the relevance and applicability of the decision in _*Bal Kishan Das 's_ case while dealing with the application in terms of Section 438 Cr.P.C. (772-C) _*Bal Kishan Das_ v. _F.C. Nayar,_ (1991) Suppl. 2 SCC 412 and _**Adri Dharan Das_ v. _State o/W.B.,_ (200SJ 4 SCC 303, relied on. II 770 SOHAN LALJUNEJA _v._ ST A TE OF PUNJAB [PASA Y AT, J.] 771 1.2. The High Court has not considered the relevant aspects and has also not indicated any reason as to why it felt necessary to direct deposit of Rs.10,00,000/-. Further the ambit of Section 438 Cr.P.C. as delineated by this Court has not been kept in view. (772-B) CRIMINAL APPELLATE JURISDICTION : Criminal Appeal No.1133 of ~ B From the Judgment and interim Order dated 8.5.2006 of the High Court of Punjab and Haryana at Chandigarh in Cr!. M. No. 27303-M/2006. R.K. Talwar and S.L. Aneja for the Appellants. c Arun K. Sinha for the Respondent. > The Judgment of the Court was delivered by: ## ARIJIT PASA Y AT, J. Leave granted. D Challenge in this appeal is to the orders passed by the Punjab and Haryana High Court dealing with the appellants' application in terms of Section 438 of the Code of Criminal Procedure, 1973 (in short the 'Cr.P.C. ')in Criminal Case No. 27303-M of 2006. The First Information Report (in short 'FIR') was lodged against the appellants and others for their alleged involvement in mis-appropriation of stock. According to the appellants, the E dispute essentially revolves around contractual liability and is of a civil nature. In an arbitration proceeding the matter is under examination. The High Court by order dated 8th May, 2006 granted interim protection in terms of Section 438 Cr.P.C. on the condition that a sum of Rs.10,00,000/- shall be deposited with Markfed i.e. the complainant in the case. Subsequently because F of non-deposit of the amount as directed, notwithstanding the issuance of notice by this Court the protection was denied and prayer in terms of Section 438 Cr.P.C. was rejected. Learned counsel for the appellants submitted that in view of the decision of this Court in _Bal Kishan Das_ v. _P.C. Nayar,_ [1991] Suppl. 2 SCC 412 the G proceedings are not maintainable and the condition of depositing a huge sum of Rs.10,00,000/- as directed by the High Court cannot stand scrutiny in law. Learned counsel for the respondent-State on the other hand submitted that a huge loss was caused to the complainant because of the. _conspiracy_ of the appellants and other employees of the complainant. This is basically H 772 SUPREME COURT REPORTS (2006) SUPP. 8 S.C.R. A not a case of civil dispute and even if arbitration proceedings are in progress, that cannot stand in the way of the criminal proceedings, can be pursued. We find that the High Court has not ~onsidered the relevant aspects and has also not indicated any reason as to why it felt necessary to direct deposit of Rs. I 0,00,000/-. Further the ambit of Section 438 Cr.P.C. as delineated B by this Court has not been kept in view. In the circumstances, we set·aside the orders of the High Court dated. 8.5.2006 and 7.8.2006 and remit the matter to it for fresh consideration. Needless to say while dealing with the matter the High Court shall keep in view the C principies indicated by this Court relating to Section 438 in _Adri Dharan Das_ v. _State of W.B.,_ [2005] 4 SCC 303] and the relevance and applicability of the decision in _Bal Kishan Das 's_ case (supra) while dealing with the application in terms of Section 438 Cr.P.C. The appeal is disposed of accordingly. D.G. Appeal disposed of.