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PETITIONER: STATE OF MAHARASHTRA

       Vs.

RESPONDENT: LALJIT RAJSHI SHAH & ORS.

DATE OF JUDGMENT:       28/02/2000

BENCH: N.S.Hegde, G.B.Pattanaik

JUDGMENT:

     PATTANAIK, J.

     These  appeals  by  grant of leave by the  High  Court itself  under Article 134(1)(c) of the Constitution of India read  with  Rule  28(2) of the Supreme Court Rules,  by  the State  of  Maharashtra,  raises  the  question  whether  the Chairman  of  a Co-operative Society under  the  Maharashtra Co-operative  Societies  Act,  can be held to be  a  public servant  for the purpose of Section 21 of the Indian  Penal Code  and  as  such, can be proceeded against  for  offences under  Section 5(1) read with Section 5(2) of the Prevention of Corruption Act, 1947.

     The  short  facts  necessary  for  disposal  of  these appeals  may  be briefly stated as under.  On the  basis  of criminal  prosecution  under Sections 120-B, 409, 420,  467, 471  and 477-A of the Indian Penal Code, Sections 7 and 9 of the  Essential  Commodities  Act and  Sections  5[1][c]  and 5[1][d]  read  with  Section  5[2]   of  the  Prevention  of Corruption  Act,  the Special Judge took cognizance  of  the offences  as  against the accused respondents.  The  accused persons  are  the members of the Managing Committee  of  the co-operative societies and the Chairman of such co-operative societies.  It was agitated before the learned Special Judge by  the accused persons that they are not public  servants for the purposes of offences under Section 409 of the Indian Penal Code and Section 5[1][c] and 5[1][d] of the Prevention of  Corruption Act, 1947 and further, the prosecution is not maintainable  for  want of previous sanction.   The  learned Special  Judge  considered the provisions of Section 161  of the  Maharashtra  Co-operative  Societies  Act  (hereinafter referred  to  as the Act) and came to the conclusion  that the  accused persons cannot be held to be public  servants as  defined  under  Section  21 of  the  Indian  Penal  Code notwithstanding  the  incorporation  of Section  21  of  the Indian  Penal Code in Section 161 of the Act and, therefore, no  cognizance  can  be  taken of  the  offences  under  the Prevention  of Corruption Act.  On the question of sanction, the  Special  Judge also agreeing with the  accused  persons held  that  no  previous sanction having been  obtained  for prosecution of the accused persons, the cognizance is bad in law.   Assailing  the  order of learned Special  Judge,  the State  moved  the  High Court.  When the matter  was  placed before  a learned Single Judge, he referred the matter to  a

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larger Bench as he did not agree with the views expressed by several  other  learned  Single Judges of  the  Court.   The learned  Single  Judge  formulated two questions  for  being answered by the larger Bench:

     (1)  Whether  a  person defined  as  officer  under Clause  (20)  of Section 2 of the Maharashtra Co-  operative Societies  Act,  1960,  is  a Public  Servant  within  the meaning  of  Section 2 of the Prevention of Corruption  Act, 1947  (II  of 1947), by virtue of the provisions of  Section 161  of  the Maharashtra Co-operative Societies  Act,  1960, read with Section 21 of the Indian Penal Code?

     (2)  Whether, assuming that provisions of Section 2 of the  Prevention  of Corruption Act, 1947 are  applicable  to such  a  person, is the sanction to prosecute such a  person required  under  any  of the Clauses of sub-section  (1)  of Section  6 of the Prevention of Corruption Act, 1947 capable of  being given under the Maharashtra Co-operative Societies Act, 1960?

     The  Division Bench by the impugned Judgment  analysed the  provisions of Section 161 of the Act as well as Section 21  of the Indian Penal Code and Section 2 of the Prevention of  Corruption  Act, 1947.  The Division Bench of  the  High Court  came  to the conclusion that Section 161 of  the  Act incorporating Section 21 of the Indian Penal Code ipso facto does not enlarge the definition of the term public servant in  Section  21 of the Indian Penal Code.  It  further  held that  the  State  Legislature which was competent  to  amend Section 21 of the Indian Penal Code, the subject of criminal law  being  on  the con-current list and yet  the  said  not having  been  done,  the expression public  servant  under Section  161  of  the Act would mean those  officers  to  be public  servants for the purpose of offences under the Co- operative  Societies Act and Section 21 of the Indian  Penal Code  cannot  be said to have engrafted into Section 161  of the  Act.  Accordingly, the High Court held that the accused persons  cannot be prosecuted for offences under Section 409 of  the  Indian Penal Code and Sections 5[1][c] and  5[1][d] read  with 5(2) of the Prevention of Corruption Act,  though they  can  be  prosecuted  for   other  offences  for  which cognizance  had been taken.  Having held so, leave to appeal having  been prayed for by the State, the High Court granted leave  under Article 134(1)(c) of the Constitution read with Rule  28(2) of the Supreme Court Rules and hence the present appeals.

     On behalf of the appellant-State, it is contended that the  Registrars  and other officers under  the  Co-operative Societies Act, having been held by the Act itself, deemed to be public servants within the meaning of Section 21 of the Indian  Penal  Code, those officers could be prosecuted  for the  offences  under Indian Penal Code  notwithstanding  the fact that they do not become ’public servants’ under Section 21  of the Indian Penal Code and the High Court,  therefore, was  in  error  in coming to the conclusion that  until  and unless the provisions of Section 21 of the Indian Penal Code are  amended,  these  officers   cannot  be  prosecuted  for offences committed under Indian Penal Code.

     Mr.   Deshpande,  learned  counsel appearing  for  the

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respondents  on the other hand contended that the provisions of  Maharashtra Co-operative Societies Act, were enacted  by the  State  Legislature, for which they had  the  competence under  Entry 32 of List II of the Seventh Schedule read with Entry  64  thereof,  whereas Indian Penal Code  is  an  pre- existing  law,  which was there at the commencement  of  the Constitution  and is a legislation under Entry 1 of List III of  the  Seventh  Schedule.   The two  Statutes  operate  in different  and distinct field and, therefore, the provisions thereof  have to be judged with reference to its own  source and  this being the position in law, an officer who may be a public  servant  under  Section 161  of  the  Co-operative Societies  Act  cannot be prosecuted for offences under  the Indian Penal Code, so long as Section 21 of the Indian Penal Code,  is not amended and the impugned judgment of the  High Court,  therefore,  is  unassailable.  The  learned  counsel further  submitted that in view of the pronouncement of  the Supreme Court in Antulays case, 1984(2) SCC 183, indicating as  to  who  can be a public servant, the  elected  office bearers  of the Co- operative Society cannot come within the purview  of the said definition and, therefore, they  cannot be  prosecuted  for  offences under the Indian  Penal  Code, until  and unless Section 21 of the Indian Penal Code itself is  amended.   Lastly, he urged that this question has  been decided  by  this  Court in Ramesh Balkrishna  Kulkarni  vs. State  of Maharashtra, 1985(3) SCC 606, wherein an identical provision   under   Section    302    of   the   Maharashtra Municipalities  Act,  1965 was under consideration  and  the Court  held that the concerned officers cannot be prosecuted for offences under the Indian Penal Code.

     In  view of the rival submission at the Bar, the  sole question that arises for consideration is, as to what is the effect  of the provisions of Section 161 of the  Maharashtra Co-operative Societies Act in interpreting the provisions of Section 21 of the Indian Penal Code.  It is undoubtedly true that  the Co-operative Societies Act has been enacted by the State  Legislature and their powers to make such legislation is  derived from Entry 32 of List II of the Seventh Schedule to  the  Constitution.  The legislature no-doubt in  Section 161  has  referred  to the provisions of Section 21  of  the Indian  Penal  Code  but such reference would not  make  the officers  concerned  public servants within the  ambit  of Section  21.  The State Legislature had the powers to  amend Section  21  of  the  Indian  Penal  Code,  the  same  being referable  to a legislation under Entry 1 of List III of the Seventh   Schedule,  subject  to   Article  254(2)  of   the Constitution as, otherwise, inclusion of the persons who are public  servants  under  Section 161 of  the  Co-operative Societies  Act  would  be  repugnant to  the  definition  of public  servant under Section 21 of the Indian Penal Code. That  not  having been done, it is difficult to  accept  the contention  of  the leaned counsel, appearing for the  State that  by virtue of deeming definition in Section 161 of  the Co-operative Societies Act by reference to Section 21 of the Indian Penal Code, the persons concerned could be prosecuted for  the  offences under the Indian Penal Code.  The  Indian Penal  Code and the Maharashtra Co- operative Societies  Act are   not  Statutes  in   pari  materia.   The  Co-operative Societies  Act  is a completely self-contained Statute  with its  own provisions and has created specific offences  quite different  from the offences in the Indian Penal Code.  Both Statutes  have  different objects and created offences  with separate  ingredients.   They  cannot thus be  taken  to  be Statutes  in  pari materia, so as to form one system.   This

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being  the  position,  even   though  the  Legislatures  had incorporated  the  provisions  of Section 21 of  the  Indian Penal  Code into the Co-operative Societies Act, in order to define a public servant but those public servants cannot be  prosecuted  for having committed the offence  under  the Indian  Penal  Code.   It  is  a  well  known  principle  of construction  that  in interpreting a provision  creating  a legal  fiction,  the Court is to ascertain for what  purpose the  fiction  is created, and after ascertaining  this,  the Court  is  to assume all those facts and consequences  which are incidental or inevitable corollaries to giving effect to the  fiction.  But in so construing the fiction it is not to be  extended beyond the purpose for which it is created,  or beyond  the language of the Section by which it is  created. A legal fiction in terms enacted for the purposes of one Act is normally restricted to that Act and cannot be extended to cover  another  Act.  When the State Legislatures  make  the Registrar, a person exercising the power of the Registrar, a person  authorised to audit the accounts of a society  under Section 81or a person to hold an inquiry under Section 83 or to  make  an  inspection  under  Section  84  and  a  person appointed  as  an  Administrator under Section 78  or  as  a Liquidator  under Section 103 shall be deemed to be  public servant  within  the  meaning of Section 21 of  the  Indian Penal Code.  Obviously, they would not otherwise come within the  ambit  of Section 21, the legislative intent  is  clear that a specific category of officers while exercising powers under specific sections have by legal fiction become public servant and it is only for the purposes of the co-operative Societies  Act.  That by itself does not make those  persons public  servants under the Indian Penal Code, so as to  be prosecuted  for having committed the offence under the Penal Code.   When a person is deemed to be something, the  only meaning  possible is that whereas he is not in reality  that something, the Act of legislature requires him to be treated as  if  obviously for the purposes of the said Act  and  not otherwise.   In  a  somewhat  similar  situation  in  Ramesh Balkrishna  Kulkarni vs.  State of Maharashtra, 1985(3)  SCC 606,  the question for consideration was whether a Municipal Councillor can be prosecuted for having committed an offence under  the Indian Penal Code, since under Section 302 of the Municipalities  Act,  a Councillor shall be deemed to  be  a public  servant  within the meaning of Section 21  of  the Indian   Penal  Code.   Section   302  of  the   Maharashtra Municipalities Act, 1965 is quoted herein below in extenso:

     302.   Every councillor and every officer or  servant of  a Council, every contractor or agent appointed by it for the  collection of any tax and every person employed by such contractor or agent for the collection of such tax, shall be deemed  to be a public servant within the meaning of Section 21 of the Indian Penal Code.

     A  Municipal  Councillor  was  prosecuted  for  having committed  an offence under the Prevention of Corruption Act and the said conviction and sentence was upheld in appeal by the  High  Court,  but  this  Court  in  the  aforementioned decision,  1985(3)  SCC  606, set aside the  conviction  and sentence  on  a finding that Municipal Councillor cannot  be held  to be a public servant within the meaning of Section 21  of the Indian Penal Code.  In the aforesaid premises, we see  no  infirmity  with the impugned judgment of  the  High Court to be interfered with by this Court.  The appeals fail and are dismissed.

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