1999-(004)-CLJ -0465 -KAR Companies Act Judgements

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1999-(004)-CLJ -0465 -KAR

PARAMJIT SINGH v. UNION OF INDIA AND OTHERS.

Writ Petition No. 10363 of 1994, decided on December 18, 1998.

IN THE HIGH COURT OF KARNATAKA AT BANGALORE

K. PRABHAKAR and S. M. HEGDE KADVE, Advocates, for the petitioners.

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D. V. SHYLENDRA KUMAR, Central Government Standing Counsel for respondent 1.

SMT. T. N. MANJULA DEVI, Advocate, for respondent 3.

ORDER

R. P. SETHI, C.J. – Heard.

2. Constitutional validity of the Consumer Protection Act, 1986 (hereinafter called the ‘Act’) has been upheld by this court in the judgment pronounced today in Vishwabharti House Building Co-operative Society Limited, Bangalore v. Union of India and Others (1999) 4 Comp LJ 454 (Karn) : (1999) 2 Karn LJ 38 (Karn).

3. Validity of section 27 of the Act has specifically been assailed in this petition with prayer for quashing the same holding it arbitrary, unguided and thereby unconstitutional. It is submitted that consumer forums under the Act have been clothed with the blanket powers to pass orders including an order of civil imprisonment for the breach that may be committed by the party against whom the order is passed under the Act. As section 27 does not prescribe any procedure for trial, the same is required to be declared unconstitutional being violative of Article 21 of the Constitution. According to the petitioner, the aforesaid section curtails the personal liberty of the citizen without prescribing any procedure to be followed before awarding the punishment as contemplated under the Act. The personal liberty enshrined under Article 21 of the Constitution cannot be dealt with so lightly and permitted to be affected, destroyed or taken away in the manner provided under the Act.

4. section 27 of the Act provides :

“Penalties – Where a trader or a person against whom a complaint is made or the complainant fails or omits to comply with any order made by the District Forum, the State Commission or the National Commission, as the case may be, such trader or person or complainant shall be punishable with imprisonment for a term which shall not be less than one month but which may extend to three years, or with fine which shall not be less than rupees two thousand, but which may extend to rupees ten thousand or with both :

Provided that the District Forum, the State Commission or the National Commission, as the case may be if it is satisfied that the circumstances of any case so require, impose a sentence of imprisonment or fine, or both, for a term lesser than the minimum term and the amount lesser than the minimum amount, specified in this section.”

A perusal of the section 27 of the Act shows that it creates an offence without prescribing any procedure for the [District] Forum or the (State and National] Commissions under the Act to impose the punishment provided under the said section. It is contended that the proviso to the aforesaid section authorising the District Forum, and the Commissions to impose sentence of imprisonment or fine is the infringement of the rights guaranteed under Articles 20 and 21 of the Constitution of India. We find substance in this submission as we are of the opinion that no person can be convicted of any offence except for violation of law in force at the time of the commission of the act charged as an offence. The conviction envisaged under Article 20 of the Constitution contemplates the proceedings before a court of law, which means an initiation or starting of proceedings of criminal nature before a court in accordance with the procedure prescribed in the statute, which created the offence and regulated the punishment. Conviction without trial would amount to deprivation of the personal liberty of a person within the meaning of Article 21 of the Constitution. Article 21 puts a restriction upon the State to encroach upon the personal liberty of a person save in accordance with law and in conformity with the procedure prescribed in that behalf. Procedure established by law within the meaning of Article 21 is understood to mean the law prescribed by the legislature at any given point of time. Without prescribing the procedure, no person can be deprived of his personal liberty, which means freedom from physical restraint of a person by incarceration.

5. In Smt. Maneka Gandhi v. Union of India and Another AIR 1978 SC 597, the apex court held that the expression ‘personal liberty’ in Article 21 was of widest amplitude, which covered a variety of rights by which the life can be enjoyed. Procedure established by law envisages the minimum compliance of the principles of natural justice.

6. As the proviso to section 27 of the Act authorises the Forum and the Commissions to impose a sentence of imprisonment or fine without providing any procedure resulting in deprivation of the rights conferred upon the persons under Articles 20 and 21 of the Constitution, the same is liable to be struck off being unconstitutional. The striking off of the proviso to section 27 of the Act would not, however, render the whole section unconstitutional. As the section creates the offence and provides the penalty, we are of the opinion that such offence has to be dealt with, tried and concluded in accordance with the provisions of the Code of Criminal Procedure.

7. Section 4 of the Code of Criminal Procedure provides :

“Trial of offence under the Indian Penal Code and other laws. – (1) All offences under the Indian Penal Code (45 of 1860) shall be investigated, inquired into, tried and otherwise dealt with according to the provisions hereinafter contained.

(2) All offences under any other law shall be investigated, inquired into, tried, and otherwise dealt with according to the same provisions, but subject to any enactment for the time being in force regulating the manner or place of investigating, inquiring into, trying or otherwise dealing with such offences.”

All offences under any special statute unless otherwise expressly provided are required to be investigated, inquired into, tried and otherwise dealt with according to the procedure prescribed under the Code of Criminal Procedure. The provisions of the section are plenary, which provide that if any person accused of an offence created under a special statute is decided to be prosecuted, the recourse to the Criminal Procedure Code and the procedure prescribed therein shall be applicable unless specifically excluded or otherwise provided. section 27 of the Act has not in any way taken away or barred the jurisdiction of the ordinary criminal courts.

8. It follows, therefore, that where a trader or a person omits to comply with any order made by the District Forum, the State Commission or the National Commission, as the case may be, the complainant in that event can file a complaint before such forum or Commission and if despite opportunity, the trader or a person fails or omits to comply with the order passed under the Act, the appropriate Forum or the Commission can direct the filing of the complaint in a court of competent jurisdiction. Upon filing of such complaint, the procedure prescribed under the Code of Criminal Procedure has to be followed and on proof of the allegations, the accused shall be convicted for the offence and sentenced to the penalties as contemplated under section 27 of the Act. The provisions of section 27 are not distinct from section 25 of the Act. Section The Company Secretary Hani Industries Ltd. 1408/9 Phase III, GIDC Ankleshwar 393002 Gujarat in effect and in essence is a provision beneficial to the trader, who can avoid the conviction and sentence by complying the order of the Forum or the State and the National Commission when complained of by the consumer. It is only upon his failure and omission, that a trader shall be deemed to be guilty of the commission of an offence triable by a ordinary magistrate in accordance with the procedure prescribed under the Code of Criminal Procedure.

9. We are, therefore, of the opinion that the proviso to section 27 being violative of the fundamental rights as enshrined under Articles 20 and 21 of the Constitution of India is liable to be quashed. We are further of the opinion that but for the proviso, there is no unconstitutionality in the main section. It is, therefore, held that the offences created and penalties provided under

section 27 can be tried and imposed only in accordance with the observations made hereinabove by filing a complaint before a criminal court in accordance with the procedure prescribed in that behalf.

10. The writ petition is, accordingly, partly allowed and rule issued to that extent is made absolute.

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