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Reportable

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL  APPEAL  NO. 387 OF 2007

Engineering Export Promotion Council ...Appellant

Versus

Usha Anand and another              ...Respondents

J U D G M E N T

Dipak Misra, J.

In  this  appeal  challenge  is  to  the  orders  dated  

1.6.2006 and 4.7.2006 passed by the High Court of Delhi  

in Criminal M.C. No. 540 of 2004 in Crl. M. (M) No. 3009 of  

2003 and Crl. M. No. 6349 of 2006 in Crl. M. (M) No. 3009  

of 2003 respectively.

2. The  facts  which  are  essential  to  be  exposited  are  

that the husband of the Ist respondent, late Yash Pal

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Anand,  was  a  merchant  exporter  of  automotive  

components  and  was  carrying  on  business  in  the  

name  and  style  of  M/s.  Anand  Craft  Centre.   The  

Central  Bureau of  Investigation (CBI)  registered six  

cases  against  him  for  offences  punishable  under  

Sections 420, 468/471 of the Indian Penal Code (for  

short  “IPC”)  in  the  year  1994.   Identical  cases  of  

equal numbers were registered against his brothers,  

namely, Ashok, Satish and Subhash.  The allegations  

against the four accused persons are not required to  

be  stated  because  the  controversy  pertains  to  a  

different  realm  altogether.   As  the  factual  matrix  

would  demonstrate,  late  Yash  Pal  Anand  had  

deposited  a  sum  of  Rs.22  lakhs  with  Engineering  

Export  Promotion  Council  (EEPC),  a  channelising  

industry  under  the  Ministry  of  Commerce.   Other  

three brothers had also deposited the sum with the  

said agency.   The trial continued in different cases  

against all the four brothers and, eventually, Ashok,  

Satish and Subhash were acquitted in all the cases  

by the trial court which extended them the benefit of  

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doubt.  As far as the husband of the Ist respondent is  

concerned, he expired before the conclusion of the  

trial  and,  therefore,  the  trial  stood  abated  against  

him.  Against the judgment of acquittal of the three  

brothers CBI preferred appeals which were dismissed  

on 27.5.2002 and no appeal was preferred assailing  

the judgment of affirmation of acquittal.  Thereafter,  

they claimed refund of the amount by filing requisite  

applications before the learned trial  Judge who, by  

order  dated  13.8.2001,  directed  refund  of  the  

amount.  The reason ascribed by the trial court for  

refund was that the said sum was deposited by the  

accused persons in compliance of the conditions of  

the  bail  order  and  it  was  clearly  stated  that  the  

accused persons had deposited the money without  

prejudice  to  their  rights  and  as  they  had  been  

acquitted, they were entitled to refund of the money  

deposited with the EEPC.   

3. As the amount was not refunded despite the order  

passed  by  the  trial  court,  one  of  the  brothers  

preferred  Cri.M.  (M)  No.  3541  of  2001  before  the  

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High  Court  which  passed  an  order  directing  the  

present  appellant  to  refund  the  amount.    The  

relevant part of the order dated 5.10.2001 passed in  

Crl. M. (M) No. 3541 of 2001 is as  follows: -

“The question that is being raised before me, is  whether the amount deposited by the accused  persons  pursuant  to  orders  dated  12.10.1994  requiring  the  petitioner  to  deposit  a  sum  of  Rs.15,24,079/-  with the second respondent  by  way of terms and condition of the bail and the  petitioner during trial having been acquitted of  all charges on 22.6.2001 is entitled to receive  back the money that is deposited pursuant to  the  orders  of  this  Court  with  the  second  respondent  as  a  condition  of  bail.   Learned  counsel for the CBI submits that the CBI does  not  have  the  money  and  that  the  same  was  deposited  with  the  second  respondent  and,  therefore it is only the second respondent that  can be directed to return the money deposited.

I  have heard learned counsel  present for  the parties the second respondent choosing not  to  be  present,  I  direct  that  the  amount  deposited  by  the  petitioner  with  the  second  respondent pursuant to orders of this Court and  which was directed to  be returned vide order  dated  13.8.2001  shall  be  returned  within  a  period of two weeks from date of service of the  order.”

4. Thereafter,  the 1st respondent filed Crl.  M.  (M) No.  

3009  of  2003  with  a  prayer  to  command  the  

respondent No. 2, the appellant herein, to refund the  

amount of Rs.22 lakhs on the ground that she was  

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the  sole  legal  heir;  that  the  allegations  in  all  the  

cases were identical without any exception; that the  

trial  court  had  allowed  the  applications  for  refund  

vide  order  dated  13.8.2001  in  respect  of  other  

brothers; that as the order passed by the trial court  

was not complied with, one of the brothers had filed  

Crl. M. (M) No.  3541 of 2001 before the High Court  

which  was  disposed  of  by  order  dated  5.10.2001  

directing  the  respondent  to  refund  the  deposited  

amount within two weeks; that as the trial  against  

the husband had abated, she had not been able to  

move  the  application  earlier;  that  after  the  

termination  of  the  trial  she  had  approached  the  

officers  of  the  respondent  but  despite  the  earlier  

direction by this  Court  and they being under legal  

obligation to refund the amount, tremendous apathy  

was shown and money was not refunded; and that no  

response  was  given  to  the  legal  notice  and,  

therefore, she was entitled to refund of the deposited  

sum.   

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5. The High Court entertained the application preferred  

by the 1st respondent and passed the following order  

on 3.12.2003: -

“In  identical  petition  namely  Crl.  M.  (M)  No.  3541/2001  an  order  dated  15.10.2001  was  passed directing refund of the money deposited  by the petitioner of that petition within a period  of  two weeks from the date of  service of  the  respondent.

Since  in  this  case  also  respondent  No.  2  has  been  served  the  same  order  needs  to  be  passed.   The  amount  deposited  by  the  petitioner  shall  now  be  returned  to  the  petitioner  within  a  period  of  two  weeks  from  today.”

6. Being grieved by the aforesaid order  special  leave  

petition (Crl.)  No.  41 of  2004 was filed before this  

Court,  which  was  eventually  converted  to  Criminal  

Appeal No.1085 of 2004.  This Court, on 27.9.2004,  

passed  the  following  order  in  the  said  criminal  

appeal: -

“Let  the present appellant, if they are advised,  file  their  objections,  if  any,  to  the  petition  in  Criminal Miscellaneous (Main) No. 3009 of 2003  in  the  High  Court  within  three  weeks  from  today.  If any objection is filed, the same shall  be  considered  on  its  own  merits  by  the  High  Court about which we express no opinion.  The  Criminal Miscellaneous (Main) No. 3009 of 2003  shall be restored to its original position as stood  

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before disposal on 3.12.2003.  If no objection is  filed,  the  order  passed  on  3.12.2003  shall  remain  operative.   The  liberty  given  to  the  appellant  to  file  a  counter  shall  be  also  applicable to the CBI.

This order has been passed notwithstanding the  stand of  the respondents  that  full  liberty  was  granted  to  the  appellant  to  file  any  objection  which they failed to avail.  Since a specific stand  has been taken that the appellant intended to  file objections for which it was not granted any  opportunity,  we  have  passed  the  present  order.”

7. After the aforesaid order an objection was filed and  

the High Court,  while dealing with the controversy  

referred  to  the  order  passed  by  the  trial  court  on  

13.8.2001 directing refund of amount in respect of  

other  accused persons,  and further referred to the  

order  passed  on  5.10.2001,  which  we  have  

reproduced  hereinabove,  and  thereafter,  as  is  

manifest from the order impugned, it reproduced a  

part of  the letter dated 30.8.1994 by late Yash Pal  

Anand written to the respondent No. 2 therein and  

observed thus: -

“Admittedly,  the  other  three  brothers  also  deposited  the  amount  under  the  same  circumstances.  After their acquittal when they  applied  to  the  trial  court  for  refund  of  the  amount  deposited  by  them  the  trial  court  

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directed  the  refund  of  the  amount.   While  passing  the  order  of  refund  the  learned  trial  court  has  categorically  observed  that  money  was deposited in compliance of the condition of  bail order and without prejudice to the rights of  the  accused  to  be  entitled  to  refund  of  the  money.   I  fail  to  understand as  to  why same  treatment be not meted out to the petitioner.”

8. Being of this view, the High Court further opined that  

once  the  proceeding  stood  abated  against  him,  it  

cannot be argued that the case would have resulted  

in conviction when cases against other brothers on  

identical allegations had resulted in acquittal and the  

appeals  had  been  dismissed.   Resultantly,  the  

petition  was  allowed  and  the  respondent  No.  2  

therein was directed to refund the amount within a  

period of four weeks.

9. Mr.  Amit  Singh  Chadha,  learned  senior  counsel  

appearing for the appellant,  has seriously criticized  

the  order  on  the  ground  that  the  respondent’s  

husband had deposited the money with the appellant  

on his own and it is not in pursuance of the order or  

command of any court and it has nothing to do with  

the grant of  bail.   It  is  strenuously urged that  the  

High Court has fallen into grave error by applying the  

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doctrine of parity which is remotely not applicable.  It  

is canvassed by him that when as a condition of bail  

a sum is deposited, the same is liable to be released  

after acquittal but when an amount is deposited on  

one’s volition it  cannot be directed to be refunded  

under Section 482 of the Code of Criminal Procedure  

(for short “the Code”).    

10. The learned counsel  for  the respondent No.  2,  per  

contra, would contend that the order passed by the  

High  Court  is  absolutely  defensible  inasmuch  as  

when  the  trial  stood  abated  against  late  Yash  Pal  

Anand,  husband  of  the  Ist  respondent,  it  had  the  

effect  of  acquittal  and,  therefore,  the  fall  out  is  

refund of the amount which had been deposited with  

the appellant.  It is his further submission that when  

the charges were identical against all and the three  

accused  persons  were  acquitted,  there  was  no  

justification to treat the legal heir of other accused in  

a different manner.  It is put forth that the amount  

was deposited by late Yash Pal Anand to avoid arrest  

and without prejudice which is perceptible from letter  

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dated  30.8.1994  written  by  him  to  the  appellant  

which has been appositely referred to by the High  

Court  and  hence,  interference  with  the  order  

impugned  would  amount  to  non-refund  of  the  

amount  to  the  respondent  which  would  result  in  

miscarriage of justice.

11. To appreciate the rivalised submissions raised at the  

Bar, we have with great anxiety scrutinized the order  

passed  by  the  High  Court.   Indubitably,  the  High  

Court  was  exercising  its  inherent  powers  under  

Section 482 of the Code.  The fulcrum of the order  

passed by the High Court is that late husband of the  

Ist  respondent  had  deposited  the  money  to  avoid  

arrest  and  similarly  placed  accused  persons  had  

been acquitted and they had been granted relief of  

refund by the trial court and again reiterated by the  

High Court  under Section 482 of  the Code,  similar  

treatment should be meted out to her.  

12. To appreciate the ratiocination of the order passed  

by the High Court it is necessary to understand the  

jurisdiction  of  the  High  Court  while  exercising  the  

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power  under  Section  482  of  the  Code.   In  R.P.  

Kapur  v.  State of  Punjab1,  a  three-Judge  Bench  

was  dealing  with  the  scope of  inherent  power  the  

High Court under Section 561A of the old Code.  In  

that  context,  it  has  been  observed  that  the  High  

Court has said inherent power as may be necessary  

is meant to give effect to any order under the Code  

or to prevent abuse of the process of any court or  

otherwise to secure the ends of justice.

13. In State of Punjab v. Kasturi Lal and others2, the  

Court,  dealing with the scope of exercise of power  

under Section 482 of the Code. has observed that the  

Section does not confer any new power on the High  

Court.   It  only saves the inherent power which the  

Court possesses before the enactment of the Code.   

14. After  so  stating  it  has  been  laid  down  that  it  

envisages  three  circumstances  under  which  the  

inherent jurisdiction may be exercised, namely, (i) to  

give effect to an order under the Code, (ii) to prevent  

abuse  of  the  process  of  the  Court,  and  (iii)  to  1 AIR 1960 SC 866 2 AIR 2005 SC 4135

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otherwise secure the ends of  justice.   It  is  neither  

possible nor desirable to lay down any inflexible rule  

which  would  govern  the  exercise  of  inherent  

jurisdiction.   No legislative  enactment  dealing with  

procedure can provide for all cases that may possibly  

arise.  Courts, therefore, have inherent powers apart  

from express provisions of law which are necessary  

for proper discharge of functions and duties imposed  

upon them by law.  That is the doctrine which finds  

expression  in  the  section  which  merely  recognizes  

and preserves inherent powers of the High Courts.

15. In this context, we may fruitfully refer to  State of  

U.P. and others v. Surender Kumar3 wherein the  

appellant-State had assailed the order passed by the  

a learned Judge of the Allahabad High Court who, in  

exercise  of  power  under  Section  482 of  the  Code,  

had  modified  its  earlier  order  directing  the  

respondent-State and its  functionaries  not  to  carry  

out  search  and  seizure  of  the  goods  lying  at  the  

railway station or in the custody of the City Booking  

3 (2005) 9 SCC 161

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Agency  belonging  to  the  applicant  therein  prior  to  

their  delivery  to  the  consignee  and  also  not  to  

interfere  in  the  functioning  of  the  City  Booking  

Agency.   The  two  learned  Judges  opined  that  the  

High Court could not have modified the order as it  

amounted to review.  Repelling the contention that  

the High Court had only acted in accordance with the  

judgment  of  the  Division  Bench  of  the  said  High  

Court,  the  two-Judge Bench proceeded to  state  as  

follows: -

“In the garb of an application for modification of  that  order,  the  respondent  could  not  file  an  application  which  was  in  effect  a  review  application  praying  for  other  reliefs.  Yet  the  High  Court  passed  an  order  directing  the  appellants  not  to  search  and seize  the  goods  lying at the railway station or in the custody of  the City Booking Agency of the applicant prior  to the delivery to the consignees. It has further  directed that the appellants shall  not interfere  in the functioning of the City Booking Agency.  These are matters which were entirely beyond  the scope of the application under Section 482  CrPC  and  if,  we  may  say  so,  beyond  the  jurisdiction  of  the  High  Court  exercising  jurisdiction under Section 482 CrPC. It does not  arise out of any order passed by a court,  nor  was there any allegation of abuse of the process  of  the  court,  nor  was  it  a  case  of  manifest  injustice caused to a party. A direction like the  one  which  the  High  Court  has  given  in  its  impugned  order  could  be  given  by  the  High  

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Court  in  exercise  of  its  writ  jurisdiction  in  an  appropriate  case  and  not  under  Section  482  CrPC.”

16. In Divine Retreat Centre v. State of Kerala4 the  

central  controversy  that  arose  before  this  Court  

pertained  to  the  scope,  content  and  ambit  of  the  

inherent  power conferred on the High Court  under  

Section  482  of  the  Code.   A  submission  was  

canvassed  that  the  jurisdiction  of  the  High  Court  

under Section 482 of the Code was not available to  

order investigation into any case by the police.  After  

referring to number of decisions it has been opined  

thus: -

“22. In our view, there is nothing like unlimited  arbitrary  jurisdiction  conferred  on  the  High  Court  under  Section  482  of  the  Code.   The  power has to be exercised sparingly,  carefully  and with  caution  only  where  such  exercise  is  justified by the tests laid down in the Section  itself.   It is well settled that Section 482 does  not confer any new power on the High Court but  only saves the inherent power which the court  possessed before the enactment  of  the Code.  There are three circumstances under which the  inherent jurisdiction may be exercised, namely,  (i) to give effect to an order under the Code, (ii)  to prevent abuse of the process of Court, and  (iii) to otherwise secure the ends of justice.”

4 AIR 2008 SC 1614

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17. In  the  said  case,  the  two-Judge  Bench  made  a  

distinction  between  the  exercise  of  power  under  

Article 226 of the Constitution of India and the power  

under the Code.

18. In the case at hand, the High Court has given, as has  

been stated hereinbefore, emphasis on judgment of  

acquittal and the deposit of money with the appellant  

to avoid arrest.  As far as the judgment of acquittal  

because  of  abatement  is  concerned,  it  is  not  

necessary to dwell upon what would be the effect of  

an acquittal in a case of this nature.    The second  

issue  being  important  requires  to  be  delved  into.  

Late Yash Pal Anand, had written two letters to the  

appellant  on  25.8.1994  and  on  30.8.1994  

respectively.  We may reproduce the relevant part of  

the letter dated 30.8.1994 : -

“Without prejudice to our claim and contention  that benefit of I.P.R.S. has been legally claimed  by us, we are happy tendering approximately a  sum of  Rs.7,40,000.00 which  constitute about  27%  of  the  total  sum  of  Rs.27,50,000.00  as  payable  by  us  to  E.E.P.C.  as  alleged  to  be  payable.  The detail of the tendering amount is  as under.

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1. Banker’s Cheque No. 198929 dt. 27.8.94  of  Rs.  2,80,000.00  issued  by  Canara  Bank,  New Delhi.

2. Banker’s Cheque No. 198928 dt. 27.8.94  of  Rs.  4,60,000.00  issued  by  Canara  Bank, New Delhi.

Kindly accept this sum of Rs. 7,40,000.00  under  protest and acknowledge.  

We  are  already  made  13%  amount  vide  Banker’s Cheque No. 198878 dt. 25.8.94 of Rs.  3,60,000.00 issued by Canara Bank, New Delhi  and  now  total  amount  paid  40%  (Rs.  11,00,000.00)

We are at present in serious financial constraint,  therefore, the balance left over amount may not  be deposited by us immediately.  But however  the remaining sum should be deposited in the  course  of  the  time  as  intimated  to  you  from  time to time.

In view of the above you are requested to also  kindly  inform  immediately  to  the  special  investigation branch (CBI) not to take measure  against us.  

We assure you that we will fully co-operate with  you from time to time and further assure you  that the entire sum as become payable by us  shall be paid with.”  

[Emphasis added]

19. Again  on  5.10.1994  late  Yash  Pal  Anand  wrote  

another letter the relevant part of which is as follows:  

-

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“We  are  already  made  13%  amount  vide  Banker’s Cheque No. 198878 dt. 25.8.94 of Rs.  3,60,000.00 issued by Canara Bank, New Delhi  and 27% of Rs. 7,40,000.00 (Banker’s Cheque  No. 198929 dt. 27.8.94) and now total amount  paid 80% (Rs. 22,00,000.00)

We are at present in serious financial constraint,  therefore the balance left over amount may not  be deposited by us immediately.  But however  the remaining sum should be deposited as early  as possible.

In view of the above you are requested to also  kindly  inform  immediately  to  the  special  investigation branch (CBI) not to take measure  against us.”

[Emphasis supplied]

20. From the aforesaid communications, it is clear that  

the money was deposited by the husband of the Ist  

respondent  on his  own volition  with  the  appellant.  

The High Court  has  observed that  the other  three  

brothers  had  deposited  the  amount  under  same  

circumstances  and,  therefore,  after  their  acquittal  

the amount was directed to be refunded.  The High  

Court has referred to its earlier order wherein it had  

been  categorically  stated  that  the  money  was  

deposited as a condition of bail.  Deposition of any  

sum as a  condition of  bail  and a  deposit  with  the  

Agency on one’s own even if to avoid arrest would  

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stand  on  a  different  footing.  The  later  action  has  

nothing  to  do  with  the  proceedings  in  the  court.  

Thus understood, Section 482 of the Code could not  

have  been  exercised  as  the  action  taken  by  the  

appellant, a channelising industry under the Ministry  

of Commerce is absolutely an administrative action  

and, therefore, we are of the considered opinion that  

the same can only be challenged by way of a writ  

petition  and  not  by  seeking  relief  invoking  the  

inherent power under Section 482 of the Code.

21. Consequently,  the  appeal  is  allowed,  the  order  

passed by the High Court is set aside and liberty is  

granted to appellant to approach the High Court by  

way of writ  petition.   If  a writ  petition is  filed,  the  

same  shall  be  dealt  with  on  merits.   Needless  to  

emphasise,  all  contentions  relating  to  liability,  

entitlement for refund and all other aspects are kept  

open as we have not expressed any opinion on any  

count except the jurisdictional facet.  There shall be  

no order as to costs.

..............................................J.

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Page 19

[Dr. B. S. Chauhan]

..............................................J.  [Dipak Misra]

New Delhi; May 29, 2013

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