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PETITIONER: STATE OF KERALA

       Vs.

RESPONDENT: MATHAl VERGHESE & ORS.

DATE OF JUDGMENT19/11/1986

BENCH: THAKKAR, M.P. (J) BENCH: THAKKAR, M.P. (J) NATRAJAN, S. (J)

CITATION:  1987 AIR   33            1987 SCR  (1) 317  1986 SCC  (4) 746        JT 1986   928  1986 SCALE  (2)851

ACT:     Indian Penal Code, ss. 489A to 489E--Whether  applicable to  "currency  notes"  other  than  "Indian  Currency  Notes "---Counterfeiting  of or possession of  counterfeit  dollar bills or dollar notes-- Whether offence under Indian Law.     Indian  Paper  Currency Act  1822,  s.2--’Currency  Note ’--Definition-Whether  can be imported into ss.  489A--489E, I.P.C. Words & Phrases--’Currency note ’--Meaning of..

HEADNOTE:     The  respondents were charged with  offences  punishable under s. 120B, 489A, 489C and s420 read with ss. 511 and  34 IPC for forging and counterfeiting American dollar notes  of 20  dollar  denomination, by printing 2000 such  notes.  Re- spondents  1  and  2 were further alleged to  have  been  in possession of 148 forged currency notes knowing the same  to be forged, with intent to use these forged notes as genuine.     The  accused-respondents contended before  the  Sessions Court that a charge under s. 489A and 489C of the IPC  could be  lawfully levelled only in the case of counterfeiting  of ’Indian’ currency notes and not in the case of  counterfeit- ing  of ’foreign’ currency notes. The Sessions Court  upheld the aforesaid contention and discharged the accused-respond- ents.  The High Court also confirmed the aforesaid order  of discharge.     Allowing the appeal by appellant-State and remanding the case to the trial court,     HELD:  1. The High Court was wrong in holding  that  ss. 489A to 489E are not applicable to currency notes other than Indian currency notes and that counterfeiting of or possess- ing  of counterfeit dollar bills or dollar notes is  not  an offence  under the Indian Law. Therefore, the  judgment  and order  of discharge rendered by the High Court are  reversed and  set  aside. The matter will now go back  to  the  trial court  for proceeding further in accordance with  law.  [325 F-326 C] 2.1 An analysis of s. 489A reveals that: (i)  counterfeiting ’any’ currency 318 note  or bank-note is an offence;  (ii)knowingly  performing

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any part of the process of counterfeiting any currency  note or  bank-note is also an offence; and (iii) the  prohibition against counterfeiting or performing such process applies to currency  notes  as  also to bank-notes as  defined  by  the explanation  to s. 489A. And inasmuch as the  aforesaid  ex- pression  interalia means any engagement for the payment  of money to the bearer issued by or under the authority of  any State or Sovereign power provided it is intended to be  used as  equivalent  to or substitute for money  the  prohibition also extends to counterfeiting etc. of currency notes of any other sovereign power. [321 D-G]     2.2  The  expression ’currency note’ under  s.  489A  is large enough in its amplitude to cover the currency notes of ’any’  country. When the legislature does not speak of  cur- rency  notes  of India the court interpreting  the  relevant provision  of law cannot substitute the  expression  ’Indian currency  note’ in place of the expression ’currency  note’. When  the expression ’currency note’ is interpreted to  mean only  ’Indian currency note; the width of the expression  is being narrowed down or cut down. [322 A-C]     2.3  The  court  can merely interpret  the  section,  it cannot  re-write, recast or redesign the section. In  inter- preting  the provision the exercise undertaken by the  court is  to make explicit the intention of the legislature  which enacted the legislature. It is not for the court to  reframe the legislation for the very good reason that the powers  to ’legislate’  have not been conferred on the court. When  the court shrinks the content of the expression ’currency note’, to  make it referable to only ’Indian currency note’, it  is defeating  the intention of the legislature partly  inasmuch as the court makes it lawful to counterfeit notes other than Indian currency notes. The manifest purpose of the provision is that the citizens should be protected from being deceived or  cheated.  The citizens deal with and  transact  business with each other through the medium of currency. It is incon- ceivable  why the legislature should be anxious  to  protect citizens  from being deceived or cheated only in respect  of Indian  currency notes and not in respect of currency  notes issued by other sovereign powers. [322 B--322 F]     2.4  To read the expression ’any currency note’ to  mean and  refer only to ’Indian currency note’is to  misread  the expression  by doing violence both to the letter and  spirit thereof unmindful of the fact that the former expression  in its  plentitude covers the currency notes issued by any  and every country of the world whereas the latter is  applicable to only one of the countries in the world. [325 D]     3.  The expression ’bank note’ employed in ss.  489A  to 489E of IPC takes within  its sweep  an engagement  for  the payment of money issued by or under 319 the authority of any State or Sovereign power as is  evident from  the  analysis of s. 489A. It would therefore  cover  a dollar bill or dollar note as well. A dollar bill issued  by the  Soveriegn Government of United States of America  would ipsofacto  be covered by the expression ’banknote’.  And  as revealed by the analysis made earlier, the prohibition would apply  to  the  counterfeiting of a Bank-note  or  being  in possession  of  a counterfeit Bank-note as well.  It  would, therefore,  in  any  case, be an offence  tO  counterfeit  a dollar  bill or to be in possession of a counterfeit  dollar bill. [323 C-D]     4. The definition contained in s. 2 of the Indian  Paper Currency Act is only for the purpose of that particular  Act and it cannot be imported into s. 489A to 489E of the Indian Penal Code. [325 E]

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JUDGMENT: CRIMINAL  APPELLATE JURISDICTION: Criminal Appeal No. 26  of 1978     From  the  Judgement and Order dated 17.11.1976  of  the Kerala  High Court in Criminal Revision Petition No. 263  of 1975. Chettur Sankaran Nair and E.M.S. Anam for the Appellant. Nemo for the Respondents. The Judgment of the Court was delivered by      THAKKAR,  J. Counterfeiters all over the world must  be singing  in  ecstasy: "if there is heaven on  earth,  it  is here, here, here’, for, according to the KeraLa High Court1, Indian law does not make counterfeiting of currency notes of any  country  in  the world, other than that  of  India,  an offence.      The  High  Court has persuaded itself by a  process  of judicial  activism  in  reverse gear, that  making  of  such counterfeit  notes is not an offence under Section  489A  of the Indian an Penal Code (I.P.C.) and that having in posses- sion such counterfeit currency notes is not an offence under Section  489C of the I.P.C. Such a view has been taken  even though there is nothing in the language of these sections to warrant  Such  an  interpretation  as  will  become  evident presently.  1. Judgment and Order rendered by the Kerala High Court  in Cr.R.P. 263 of 1975 on November 17, 1976, giving rise to the present  appeal  by  certificate of  fitness  under  Article 134(1)(c) of the Constitution of India. 320     Facts:  The  six respondents herein  were  charged  with offences  punishable  under Sections 120B,  489A,  489B  and Section 420 read with Sections 511 and 34 IPC. The  prosecu- tion case against them was that in furtherance of a conspir- acy  entered into by accused nos. 1 to 4 to forge and  coun- terfeit  American  dollar notes of 20  dollar  denomination, they indulged in counterfeiting by printing 2000 such notes. Respondents  1  and 2 were further alleged to have  been  in possession of 148 forged currency notes knowing the same  to be forged, with intent to use these forged notes as genuine. The  respondents were committed by the Magistrate  to  stand their  trial before the Sessions Court, for offences,  under Sections 120-B, 487A and 489C read with Sections 511 and  34 IPC. It was contended by the respondents-accused before  the Sessions Court that a charge under Sections 489A and 489C of the  IPC  could  be lawfully levelled only in  the  case  of counterfeiting of’Indian’ currency notes and not in the case of  counterfeiting of ’foreign’ currency notes. The  conten- tion  was upheld by the Sessions Court at the  threshold  of the trial and the accused were discharged. Aggrieved by  the order of the Sessions Court discharging the respondents, the petitioner  (State  of  Kerala) filed  a  Revision  Petition before the High Court of Kerala. The High Court by its order under  appeal confirmed the order of discharge  rendered  by the Sessions Court holding that "in the absence of an expla- nation  similar to that in the case of bank  notes;  Section 489A  and the Sections that follow which relate to  counter- feiting of currency notes do not apply to cases of  counter- feiting of dollar bills." The petitioner thereupon filed  an application under Article 134 (1)(c) of the Constitution  of India for leave to appeal to the Supreme Court. By its order under appeal, the High Court certified it as a fit case  for appeal to the Supreme Court as "the case involves considera-

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bly  important  questions of law as to  whether  counterfeit American  dollar notes will fall within the purview of  Sec- tions  489A and 489C of the Indian Penal Code." That is  how the matter has come up before this Court.     Relevant provisions:--The anatomy of the relevant provi- sions  requires to be X-rayed at the outset.  The  concerned provisions may therefore be screened:-               "489A.  Whoever  counterfeits,  or   knowingly               performs  any part of the process of  counter-               feiting, any currency note or ank note,  shall               be  punished with (imprisonment for life),  or               with imprisonment of either description for  a               term which may extend to ten years, and  shall               be liable to fine.                          Explanation:-- For the purposes  of               this  section  and of sections  489B,  4(489C,               489D  and  489E) the  expression  "bank               note"  means a promissory note  or  engagement               for the payment               321               of  money  to bearer on demand issued  by  any               person carrying on the business of banking  in               any  part of the world, or issued by or  under               the authority of any State or Sovereign Power,               and  intended to be used as equivalent to,  or               as a substitute for money.               3.  Subs. by Act 26 of 1955, s. 117  and  sch.               for  "transportation for life" (w.  e.f.  1-1-               1956).               4.  Subs. by Act 35 of 1950, s. 3  and  Sch.II               for "489C and 489D".               "489C.  Whoever  has  in  his  possession  any               forged  or counterfeit currency-note or  bank-               note, knowing or having reason to believe  the               same to be forged or counterfeit and intending               to  use the same as genuine or that it may  be               used  as genuine, shall be punished  with  im-               prisonment  of either description for  a  term               which may extend to seven years, or with fine,               or with both."               Analysis: An analysis of Section 489A  reveals               that:--                         (i)  counterfeiting  ’any’  currency               note or bank-note is an offence;                         (ii)  knowingly performing any  part               of the process of counterfeiting any  currency               note or bank-note is also an offence; and                         (iii) the prohibition against  coun-               terfeiting or performing such process  applies               to  currency  notes as also to  bank-notes  as               defined  by the explanation to  Section  489A.               And  inasmuch  as  the  aforesaid   expression               interalia  means any engagement1 for the  pay-               ment of money to the bearer issued by or under               the authority of any State or Sovereign  power               provided it is intended to be used as  equiva-               lent  to or substitute for money the  prohibi-               tion  also extends to counterfeiting  etc.  of               currency notes of any other sovereign power. Outcome: This analysis reveals that the legislative  embargo against  counterfeiting envelops and takes within its  sweep ’currency  notes’ of all countries. The embargo is  not  re- stricted  to ’Indian’ currency notes. The legislature  could have, but has not, employed the expression ’Indian currency 1. A promise, obligation or other condition that binds. (See

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Collins Dictionary) 322 note’. If the legislative intent was to restrict the parame- ters of prohibition to ’Indian currency’ only, the  legisla- ture  could  have said so  unhesitatingly.  The’  expression ’currency  note’ is large enough in its amplitude  to  cover the  currency notes of ’any’ country. When  the  legislature does  not speak of currency notes of India the Court  inter- preting the relevant provision of law cannot substitute  the expression ’Indian currency note’ in place of the expression ’currency note’ as has been done by the High Court. The High Court  cannot do so for, the Court can merely interpret  the section; it cannot re-write, recast or redesign the section. In interpreting the provision the exercise undertaken by the Court  is to make explicit the intention of the  legislature which  enacted the legislation. In is not for the  Court  to reframe  the legislation for the very good reason  that  the powers to ’legislate’ have not been conferred on the  Court. When  the expression ’currency note’ is interpreted to  mean ’Indian currency note’, the width of the expression is being narrowed  down  or cut down. Apart from the  fact  that  the Court  does not possess any such power, what is the  purpose to  be achieved by doing so? A Court can make  a  purposeful interpretation  so  as to ’effectuate’the intention  of  the legislature  and not a purposeless one in order to  ’defeat- ’the  intention of the legislators wholly or in  part.  When the Court (apparently in the course of an exercise in inter- pretation)  shrinks the content of the expression  ’currency note;  to make it referable to only ’Indian currency  note’, it  is  defeating the intention of  the  legislature  partly inasmuch  as the Court makes it lawful to counterfeit  notes other  than Indian currency notes. The manifest  purpose  of the provision is that the citizens should be protected  from being deceived or cheated. The citizens deal with and trans- act   business  with  each  other  through  the  medium   of currency1,  (which expression includes coins as  also  paper currency that is to say currency notes). It is inconceivable why  the legislature should be anxious to  protect  citizens from  being  deceived or cheated only in respect  of  Indian currency  notes and not in respect of currency notes  issued by  other sovereign powers. The purpose of  the  legislation appears  to be to ensure that a person accepting a  currency note is given a genuine currency which can be exchanged  for goods  or services and not a worthless piece of paper  which will bring him nothing in return, it being a counterfeit  or a forged currency note. Would the legislature in its  wisdom and  anxiety to protect the unwary citizens extend  immunity from being cheated in relation to Indian currency notes  but show  total  unconcern in regard to their being  cheated  in respect  of  currency notes issued by any foreign  State  or sovereign power?. In the modern age a tourist from a foreign country  may bring from his own country into India  currency to the extent permissible under the law in India. So also he may  obtain foreign currency in exchange of Indian  currency whilst in India provided he does so to the extent  permissi- ble by the Foreign Exchange Regulation Act, 1.  Currency n. 1. a metal or paper medium of exchange  that is in current use. (Collins English Dictionary). 323 1973(1)  and operates through an authorised person(2)  known as  money changer(3). Would it be reasonable to assume  that the legislature was totally oblivious of the need to protect them  from being deceived and defrauded? It would be  unwise to  do so in the face ,of the internal evidence  which  pro- vides  a clue to the legislative anxiety on this  score.  In

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fact the framers of the Code were so anxious to protect  the general  public from fraudulant acts of counterfeiters  that not  only have they defined the word "counterfeit"  in  very wide  terms  in the Indian Penal Code, but  they  have  also prescribed a rule of evidence in Explanation 2 so as to draw an adverse presumption against the maker of the  counterfeit article,  as  is  evident from the definition  of  the  term "Counterfeit"  read with the Explanations in Section  28  of the Indian Penal Code(1).     What  is  more, the expression ’bank note’  employed  in sections  489A to 489E of I.P.C. takes within its  sweep  an engagement  for the payment of money issued by or under  the authority of any State or Sovereign power as is evident from the  analysis of the Section made hereinabove. And it  would therefore  cover  a Dollar Bill or Dollar Note  as  well.  A dollar  bill  issued by the Sovereign Government  of  United States of America would ipsofacto be covered by the  expres- sion  ’bank-note’.  And  as revealed by  the  analysis  made earlier,  the prohibition would apply to the  counterfeiting of  a  Bank-note  or being in possession  of  a  counterfeit Bank-note  as well. It would, therefore, in any case, be  an offence to counterfeit a dollar bill or to be in  possession of counterfeit dollar bill. 1. Section 13(1): The. Central Government may, by  notifica- tion  in  the official Gazette, order that subject  to  such exemption, if any, as may be specified in the  notification, no  person shall except with the general or special  permis- sion of the Reserve Bank and on payment of the fee, if  any, prescribed,  bring or send into India any gold or silver  or any  foreign exchange or any Indian  currency.  Explanation: For the purposes of this sub-section, the bringing or  send- ing  into any port or place in India of any such article  as aforesaid  intended to be taken out of India  without  being removed  from  the ship or conveyance in which it  is  being carried shall nonetheless be deemed to be a bringing, or, as the  case any gold or silver or any foreign exchange or  any Indian currency. (2)No person shall, except with the general or  special  permission of the Reserve Bank or  the  written permission  of  a person authorised in this  behalf  by  the Reserve Bank, take or send out of India any gold,  jewellery or  precious stones or Indian currency or  foreign  exchange other  than foreign exchange obtained by him from an  autho- rised dealer or from a money-changer. 2.  Sec. 6(1). The Reserve Bank may, on an application  made to  it in this behalf, anthorise any person to deal in  for- eign exchange.  (2) An authorisation under this Section shall be in writing and-      (i) may authorise dealings in all foreign currencies or may  be  restricted  to authorising  dealings  in  specified foreign currencies only;      (ii) may authorise transactions of all descriptions  in foreign  currencies  or  may be  restricted  to  authorising specified transactions only;      (iii)  may be granted to be effective for  a  specified period, or within specified amounts;      (iv)  may be granted subject to such conditions as  may be specified therein. (3)  Any authorisation granted under sub-section (1) may  be revoked by the Reserve Bank at any time if the Reserve  Bank is satisfied that-- 324 (foot note contd.)      (i) it is in the public interest to do so; or      (ii)  the authorised dealer has-not complied  with  the

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conditions subject to which the authorisation was granted or has contravened any of the provisions of this Act or of  any rule, notification, direction or order made thereunder:.      Provided that no such authorisation shall be revoked on the  ground specified in clause (ii) unless  the  authorised dealer has been given a reasonable opportunity for making  a representation in the matter. (4)  An  authorised  dealer shall, in all  his  dealings  in foreign  exchange and in the exercise and discharge  of  the powers  and of the functions delegated to him under  section 74,  comply with such general or special directions  or  in- structions as the Reserve Bank may, from time to time, think fit to give, and except with the previous permission of  the Reserve  Bank, an authorised dealer shall not engage in  any transaction  involving any foreign exchange which is not  in conformity  with the terms of his authorisation  under  this section. (5)  An  authorised  dealer shall,  before  undertaking  any transaction  in  foreign exchange on behalf of  any  person, require  that person to make such declarations and  to  give such  information  as will reasonably satisfy him  that  the transaction  will not involve, and is not designed  for  the purpose  of, any contravention or evasion of the  provisions of this Act or of any rule, notification, direction or order made thereunder, and where the said person refuses to comply with  any  such  requirement or  makes  only  unsatisfactory compliance therewith, the authorised dealer shall refuse  to undertake  the  transaction and shall, if he has  reason  to believe that any such contravention or evasion as  aforesaid is  contemplated  by the person, report the  matter  to  the Reserve Bank. 3.  Sec. 7:(1) The Reserve Bank may, on an application  made to  it in this behalf, authorise any person to deal in  for- eign currency.  (2) An authorisation under this section shall be in writing and-      (i) may authorise dealings in all foreign currencies or may  be  restricted  to authorising  dealings  in  specified currencies only;      (ii) may authorise transactions of all descriptions  in foreign  currencies  or  may be  restricted  to  authorising specified transactions only;      (iii) may be granted with respect to a particular place where alone the money-changer shall carry on his business;      (iv)  may  be granted to be effective for  a  specified period, or within specified amounts;      (v) may be granted subject to such conditions as may be specified therein. (3)  Any authorisation granted under sub-section (1) may  be revoked by the Reserve Bank at  any time if the Reserve Bank is satisfied that:-      (i) it is in the public interest to do so; or      (ii) the money-changer has not complied with the condi- tions subject to which the authorisation was granted or  has contravened  any  of the provisions of this Act  or  of  any rule, notification, direction or order made thereunder. Provided that no such authorisation shall be revoked on  the ground specified in clause (ii) unless the money-changer has been given a reasonable opportunity for making a representa- tion in the matter. (4) The provisions of sub-sections (4) and (5)’of Section  6 shall,  in so far as they are applicable, apply in  relation to  a money-changer as they apply in relation to  an  autho- rised dealer, (5)  Explanation--In  this section,  "foreign  money"  means

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foreign currency in the form of notes, coins or  travellers’ cheques  and "dealing" means purchasing foreign currency  in the. form of notes, coins or traveller’s cheques or  selling foreign currency in the form of notes or coins. 325     Why  then  construe the expression  ’currency  note’  as being applicable only to an Indian currency note and not  to a foreign currency note like a dollar bill? There is neither any  compulsion  of law nor of logic for  indulging  in  the exercise  undertaken by the High Court which in the  opening part  of  the  judgment has been adverted  to  as  ’judicial activism in reverse gear’. Nor was any ideal to be attain by doing  so.  Why then stretch the unstretchable?  It  appears that the High Court lost its way whilst groping in the  dark by  a possibly misconceived and ill-founded argument1  built on  the circumstance that whilst the explanation to  Section 489A  in terms refers to a bank note issued ’under  the  au- thority of any State or sovereign power’ similar explanation is  not  added in the context of  the  expression  ’currency note’.  The  High Court overlooked the fact that  there  was neither  any  occasion, nor any reason, nor  any  need,  for doing  so. For, the expression ’currency note’ as  it  stood was wide and pervasive enough to embrace the currency  notes issued  by India as also currency notes issued by any  other country  in the world. There was therefore no need to add  a similar  explanation. It would have been futile  to  amplify that the expression ’currency note’ which on a plain reading covers ’all’ currency notes meant what it said. To read  the expression ’any currency note’ to mean and refer to  ’Indian currency  note’ is to misread the expression by  doing  vio- lence both to the letter and spirit thereof unmindful of the fact that the former expression in its plentitude covers the currency notes issued by any and every country of the  world whereas  the letter is applicable to only one of  the  coun- tries  in  the world. The High Court also fell in  error  in being  influenced  by the definition of currency  notes  em- bodied  in the Indian Paper Currency Act (Act XX  of  1822). The  High  Court has overlooked the obvious  fact  that  the definition contained 1 in Section 2 of the said Act is  only for the purposes of that particular Act and it cannot  be imported into Section 489A to 489E of the  Indian Penal Code, as has been done by the High Court.     The High Court was thus wholly wrong in exerting  itself unnecessarily  and bending backwards in order to  hold  that Sections 489A to 489E are not 1.  "28.  A person is said to "counterfeit" who  causes  one think to resemble another thing, intending by means of  that resemblance  to  practise  deception, or knowing  it  to  be likely that deception will thereby be practised.          Explanation 1 --It is not essential to counterfeit- ing that the imitation should be exact.          Explanation  2--When a person causes one  thing  to resemble  another thing, and the resemblance is such that  a person  might  be deceived thereby, it  shall  be  presumed, until the contrary is proved, that the person so causing the one  thing to resemble the other thing intended by means  of that  resemblance  to practise deception or knew  it  to  be likely that deception would thereby be practised." 1.  Says the High Court: "The omission of an explanation  in Sec. 489A for the expression "currency note" similar to  the one for ’hank note’ thus assumes importance. The  expression could refer only to the currency notes issued by the Govern- ment of India." 326 applicable  to  currency notes other  than  Indian  currency

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notes.  And in holding that counterfeiting of or  possessing of  counterfeit dollar bills or dollar notes is not  an  of- fence under the Indian law, thereby issuing a carte  blanche to the counterfeiters of the world to establish their  head- quarters within the State of Kerala with a view to carry  on their activities with impunity under the umbrella unwitting- ly opened for them by the judgment of the High Court.     The  view  taken by the High Court  is  thus  thoroughly unsustainable. The judgment and order of discharge  rendered by the High Court are therefore reversed and set aside.  The matter will not to go back to the trail court for proceeding further in accordance with law in the light of the  observa- tions  made  hereinabove. Appeal is accordingly  allowed  to this extent. M.L.A.                                                Appeal allowed. 1. Says the High Court:-- "The  expression ’currency notes’ is Section 489A  to  489BE should  naturally refer to currency notes as defined in  Act XX of 1822." 327