ORDER
J. Chelameswar, J.
1. This matter is placed before us pursuant to the reference, dated 20.12.2002 made by one of our brother Judges Sri P.S. Narayana.
2. The petitioner is described as Slate Bank of Hyderabad, Gunfoundry Branch, Hyderabad, represented by its Manager. The 1st respondent herein filed a complaint under Section 200 of the Code of Criminal Procedure, 1973 ('the Code' for short) which was numbered as C.C. No. 569 of 2001 on the file of the IV Metropolitan Magistrate, Nampally, Hyderabad. Six persons were accused in the said complaint and the 6th accused in the complaint, whose description we have already noticed earlier, is the petitioner herein,
3. The substance of the complaint is that the complainant and the 1st accused are family friends, that the husband of the complainant and the complainant invested some money in a company called M/s. Sri Sainath Worsteds and Synthetics (P) Ltd., and, therefore, they are shareholders of the said company. Some time in the year 1986, accused No. 1 suggested to the complainant and her husband that a piece of land admeasuring about Acs. 2-00 is required to be acquired for the benefit of the above mentioned company for expanding its business and, consequently, the complainant paid an amount of Rs. 60,000/- to the 1st accused. Thereafter, the 1st accused acquired an extent of Acs. 2-00 of the land in the name of the complainant in S. No. 205 at Bonthapalli village, Sangareddy, Medak District under a registered document No. 1049/86. It is further alleged in the complaint that the complainant and her husband were living abroad in Libya for quite some time. In view of the association between the complainant's family and the 1st accused family, the title deeds of the above mentioned land were not collected by the complainant but were left in the custody of the 1st accused. It is the further allegation in the complaint that the 1st accused, taking advantage of the custody of (he above mentioned document, purported to create a mortgage on the above mentioned properly and obtained loan from the petitioner-Bank without the knowledge or consent of the complainant and in the process, he committed various offences punishable under Sections 405, 416, 420, 458, 464, 467, 470 and 474 of the Indian Penal Code. Further details of the complaint may not be necessary for the present purpose.
4. In the background of the above mentioned complaint, the petitioner, as described above, is shown to be one of the accused. Questioning the maintainability of such complaint against the petitioner, the present Criminal Petition is filed under Section 482 of the Code. In fact, a copy of the complaint is placed before this Court, The factual allegation, which is made against the petitioner in para 9 of the complaint reads us under;
'It is further submitted that the accused No. 6 officials arc hand in glove with the accused Nos. 1 to 5 as such they have neglected their official duties, advised and got executed the documents with other women who impersonated the complainant and having possession of documents forged in nature and using those documents as genuine in spite of intimating the same by the complainant through legal notice dated 18.5.1998. As such the accused No. 6 have committed an offence under Sections 474, 471, 416 and 420 IPC and defamed the complainant in the society by publishing the same in local newspapers, which offence attracts Section 499 of IPC along with the offences 474, 471, 416 and 420, IPC, etc.'
5. In fact, the offences alleged to have been committed by the petitioner in the above mentioned paragraph are offences under Sections 416, 420, 474 and 471, IPC. Section 416 is an offence titled 'cheating by personation'. Section 420 deals with cheating and dishonestly inducing delivery of property. Section 471 deals with using the forged document as a genuine document. Section 474 relates to the offence of having possession of document described in Section 466 or 467, knowing it to be forged and intending to use it as genuine. It is also alleged that the petitioner committed an offence punishable under Section 499, IPC i.e., defamation.
6. When the matter is listed, the learned Single Judge referred the following two questions to the Division Bench:
(1) Whether the Banking Institution can be prosecuted without specifically specifying the concerned human agency?
(2) Whether the complaint of this nature can be maintained against the petitioner?
7. A body, which is now called the State Bank of Hyderabad, was initially constituted by a Legislation of the erstwhile Hyderabad State called Hyderabad State Bank 1350 Fasali it is a body corporate. Subsequently the Parliament made a Law called as State Bank of Hyderabad Act, 70 of 1956. By virtue of the provisions of the said Act, the above mentioned body corporate called as the Hyderabad State Bank came to be renamed as State Bank of Hyderabad. Section 3, Sub-section 2(A) of the above Act stipulates that the State Bank of Hyderabad shall carry on business of Banking and other business in accordance with the provisions of the State Bank of India (Subsidiary Banks Act, 38 of 1959). In fact, the State Bank of India (Subsidiary Banks Act, 1959) defines Section 2(k) of the Subsidiary Act to include the State Bank of India under Subsidiary Banks. Chapters of 1959 Act deals with the management of the subsidiary Banks. Section 24, Sub-section (2) of the said Act reads as follows:
'Subject to any such directions and instructions, the general superintendence and conduct of the affairs and business of a subsidiary Bank shall, as from the appointed day, vest in a Board of Directors, who may, with the assistance of the (Managing Director), exercise all powers and do all acts and things as may be exercised or done by that Bank.'
8. Any legal proceedings by or against a body corporate is required to be brought in the name of some person authorized for that purpose by the appropriate law. Normally, the legislative practice has been that whenever a Corporation is brought into existence, a statute, which brings that Corporation into existence, makes a specific provision in that regard, indicating the person authorized to represent the body corporate in legal proceedings. The complaint does not disclose whether the Branch Manager of Gunfoundry Branch of State Bank of Hyderabad is the appropriate person authorised by the law in whose name the proceedings could be initiated.
9. As already noticed above, various offences alleged to have been committed by the so-called 6th accused are offences, which require a particular state of mind, as one of its ingredients to constitute an offence and each one of the offence mentioned earlier. By the very nature, a body corporate cannot have a mind. It functions through human agency. Assuming for the sake of arguments that some of the officers of the Bank are liable for prosecution for any or some of the offences mentioned above, it is that particular officer who could be prosecuted but not the Bank, which is a body corporate.
10. The learned Counsel for the complainant, however, placed (reliance on) a judgment of the Supreme Court reported in Aligarh Municipality v. E.T. Mazdoor Union, : 1970CriLJ1520 , to justify his complaint against the body corporate. Paragraph 6 of the said judgment reads as follows:
'In regard to the appeal by the Municipal Board, it was contended that the Board being a Corporation it acts through natural persons and, therefore, it cannot be convicted of contempt of Court. The law as it exists today admits of no doubt that a Corporation is liable to be punished by imposition of fine and by sequestration for contempt for disobeying orders of competent Courts directed against them. A command to a Corporation is in fact a command to those who are officially responsible for the conduct of its affairs. If they, after being apprised of the order directed to the Corporation, prevent compliance or fail to take appropriate action, within their power, for the performance of the duty of obeying those orders, they and the corporate body are both guilty of disobedience and may be punished for contempt. The appeal on behalf of the Municipal Board thus also fails and is dismissed.'
11. First of all, it must be noticed that the case was registered under the Contempt of Courts Act, the allegation in that case was that a particular body corporate i.e., Aligarh Municipal Board violated certain orders of the Court. In that context Their Lordships made the above mentioned observation..
12. A body corporate can acquire the rights and incur obligations to the extent the Legislature permits the same, various actions in law for the enforcement of such a right of the .body corporate or for the enforcement of obligation against the body corporate are maintainable. That being so, the principle laid down by the Supreme Court in the above mentioned case (supra 1) in the context of an action under the Contempt of Courts Act, in our view, does not automatically extend to the criminal law.
13. No doubt the Corporations can also incur a criminal liability. For example various statutes do create a criminal liability on the part of the bodies corporate whenever such bodies corporate violate any law. But it must also be remembered that those very statutes which create the criminal liability against a body corporate do normally specify that either the officers or directors as the case may be of such body corporate to be prosecuted and punished in the case when an offence is committed by the body corporate. For example is Section 138 of the Negotiable Instruments Act, 1881. Section 138 of the Act makes it an offence to draw a cheque, which would not be honoured by the drawee Bank. In view of the fact that the bodies corporate are entitled to maintain Bank accounts and draw cheques, the Legislature made a specific provision under Section 141 of the Act, wherein it was stipulated that whenever an offence under Section 138 is committed by a company, every person who, at the time of the offence, is in-charge of, and is responsible to, for the conduct of the business of the company, shall be deemed to be guilty. Similarly, Section 9(A)(A) of the Central Excise and Salt Act, 1944 makes a special provision indicating the persons who are liable for punishment, whenever any offence under the said Act is said to have been committed by a company. So is the case with Section 17 of Prevention of Food Adulteration Act, 1954. The criminal liability of a body corporate (a company in that case) under the provisions of the Prevention of Food Adulteration Act, 1954 fell for consideration of the Full Bench of the Delhi High Court reported in Delhi Municipality v. J.B. Bottling Company, 1975 Crl. L.J. 1148 (FB), and the Full Bench consisting of Justice Yogeswara Dayal (as he then was) held that, where only a corporal punishment is prescribed, an artificial body like a company cannot be prosecuted, since it cannot be punished.
14. The learned Counsel for the complainant argued that in all the cases where not only a corporal punishment but also a pecuniary punishment of fine is prescribed by the statute by a logical extension of the principle enunciated by the Full Bench in the above decision (supra) a body corporate could still be prosecuted.
15. We regret our inability to accept the submission made by the learned Counsel for the complainant-respondent. The statement of law made by the Full Bench of the Delhi High Court, in our view is not an absolute statement. It deals only with one aspect of the liability for prosecution of a body corporate by taking note of the logical absurdity of fastening criminal liability on a body corporate, in all those cases where only a corporal punishment is prescribed by law. Yet another aspect is the ability of a body corporate to commit certain offences. In fact, in the very same Full Bench judgment, Their Lordships look note of the fact that offences like murder are incapable of being committed by a body corporate. By the same logic, the offences such as cheating by personation, etc., under Sections 416, 420, 471 and 474, in our view are incapable of being committed by a body corporate. An analysis of these provisions show that one of the essential ingredients of these offences is the existence of either a fraudulent or dishonest intention, which in our view can never be attributed to a body corporate.
16. Therefore, we answer the reference in the negative. The prosecution brought against the petitioner herein is not maintainable. The Criminal Petition is, therefore, allowed by quashing the prosecution against petitioner herein in C.C. No. 569 of 2001 on the file of the IV Metropolitan Magistrate, Nampally, Hyderabad.