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Iris Computers Limited v. Askari Infotech Private Limited And Others
Factual and Procedural Background
The appellant filed a private complaint under Section 200 of the Code of Criminal Procedure (“the Code”) alleging an offence under Section 138 of the Negotiable Instruments Act, 1881. The Magistrate took cognizance, recorded the complainant’s evidence, found a prima facie case, and on 16-9-2010 issued summons to the respondents in CC No. 41505 of 2010.
After receiving summons, the respondents moved an application under Sections 202, 203 and 245 of the Code contending that the court lacked territorial jurisdiction. By order dated 22-9-2011 the Magistrate recalled the summons and returned the complaint under Section 201 with liberty to present it before a competent court.
The appellant challenged that order by a petition under Section 482 of the Code before the High Court of Karnataka. On 1-3-2012, in Iris Computers Ltd. v. Askari Infotech Pvt. Ltd., the High Court upheld the Magistrate’s action and dismissed the petition. The appellant then obtained special leave and preferred the present appeal to the Supreme Court.
Legal Issues Presented
- Whether a Magistrate, after issuing process under Section 204 of the Code, can recall that order and return the complaint on the ground of lack of territorial jurisdiction upon an application by the accused under Sections 202, 203 or 245 of the Code.
- If such recall is impermissible, what is the proper procedural remedy available to the accused challenging territorial jurisdiction at that stage.
Arguments of the Parties
Appellant's Arguments
- The Code does not confer power on a Magistrate to recall an order issuing summons; once process is issued, Section 203 cannot be invoked.
- The accused’s proper remedy is to approach the High Court under Section 482 of the Code, not to file an application before the Magistrate.
- Relied on the three-Judge Bench decision in Adalat Prasad v. Rooplal Jindal (2004) 7 SCC 338, which squarely governs the issue.
Respondents' Arguments
- The Magistrate rightly returned the complaint under Section 201(1) because he had no territorial jurisdiction.
- Adalat Prasad did not consider Section 201; therefore, that judgment should be declared per incuriam.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Adalat Prasad v. Rooplal Jindal (2004) 7 SCC 338 | No power of a Magistrate to recall an order issuing process; accused must seek relief under Section 482 CrPC. | Treated as binding; applied to hold that the Magistrate’s recall order and the High Court’s affirmation were erroneous. |
| K.M. Mathew v. State of Kerala (1992) 1 SCC 217 | Earlier view permitting recall of process by Magistrate. | Noted as overruled by Adalat Prasad; cited to contrast the prevailing law. |
| Bholu Ram v. State of Punjab (2008) 9 SCC 140 | Explains the two-stage scheme—pre-process (Sections 200–203) and post-process (from Section 204 onwards). | Quoted to reinforce that an accused cannot invoke Section 203 after process has issued. |
| Subramanium Sethuraman v. State of Maharashtra (2004) 13 SCC 324 | Follows and re-affirms Adalat Prasad. | Referenced as consistent authority supporting the appellant’s position. |
| N.K. Sharma v. Abhimanyu (2005) 13 SCC 213 | Further reiteration of the rule that recall is impermissible and remedy lies under Section 482. | Relied upon as additional support. |
| Everest Advertising (P) Ltd. v. State (Govt. of NCT of Delhi) (2007) 5 SCC 54 | Continues the line of authority of Adalat Prasad. | Cited to show consistent Supreme Court view. |
Court's Reasoning and Analysis
The Court traced the statutory scheme distinguishing two phases of a complaint case: (1) pre-process cognizance and inquiry (Sections 200–203) where the accused has no locus, and (2) post-process proceedings after issuance of summons under Section 204. Relying primarily on Adalat Prasad, the Court reaffirmed that:
- Once process is issued, Section 203 cannot be invoked because that stage is already past;
- The Code provides no review power enabling a Magistrate to recall his own order issuing process;
- An aggrieved accused must approach the High Court under Section 482 for quashing the process on jurisdictional or other grounds.
The Court rejected the respondents’ contention that Section 201 empowered the Magistrate to return the complaint at this stage, observing that such power can only be exercised before process is issued. Consequently, the High Court’s concurrence with the Magistrate’s course of action was held to be legally unsustainable.
Holding and Implications
APPEAL ALLOWED; IMPUGNED HIGH COURT AND MAGISTRATE ORDERS SET ASIDE.
The Magistrate is directed to restore the complaint to its file and proceed in accordance with law. The respondents retain liberty to challenge territorial jurisdiction before an appropriate forum under Section 482 of the Code. The judgment re-affirms the binding authority of Adalat Prasad and leaves no scope for Magistrates to recall summoning orders, thereby reinforcing procedural discipline without creating new substantive precedent.
Order
1. Leave granted. This appeal is directed against the judgment and order passed by the High Court of Karnataka at Bangalore in Iris Computer Ltd. v. Askari Infotech (P) Ltd. 2012 SCC OnLine Kar 4656, (2012) 2 AIR Kant R 406, dated 1-3-2012. By the impugned judgment and order, the High Court has confirmed the order passed by the learned Magistrate in CC No. 41505 of 2010, dated 22-9-2011, whereby and whereunder the complaint filed by the appellant was returned by the learned Magistrate on grounds of lack of territorial jurisdiction and also recalled the order issuing summons to the respondents on the application filed by the respondents under Sections 202, 203 and 245 of the Code of Criminal Procedure, 1973 (“the Code”, for short).
2. The facts are: the appellant had filed a private complaint under Section 200 of the Code against the respondents for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (“the Act”, for short). The learned Magistrate, by order dated 4-9-2010, took cognizance of the offence and the complaint was registered as CC No. 41505 of 2010. Thereafter, the learned Magistrate, upon recording the evidence of the appellant and perusing through the documents produced along with the complaint, was satisfied that a prima facie case has been made out for the offence punishable under Section 138 of the Act and issued summons to the respondents by order dated 16-9-2010.
3. After service of summons, the respondents had filed an application under Sections 202, 203 and 245 of the Code questioning the maintainability of the complaint due to lack of territorial jurisdiction of the court. The learned Magistrate, after hearing the parties, has allowed the said application and proceeded to recall his previous order issuing summons to the respondents and returned the complaint to the appellant, with a direction to present the complaint before the competent court by order dated 22-9-2011. Being aggrieved by the aforesaid order, the appellant had filed a petition under Section 482 of the Code before the High Court. The High Court while concurring with the view taken by the learned Magistrate has rejected the said petition.
4. It is the correctness or otherwise of the aforesaid order passed by the High Court that is called in question by the appellant before us.
5. The learned counsel appearing for the appellant would submit that the learned Magistrate was not justified in recalling the order issuing summons and thereafter, returning the complaint under Section 201 of the Code upon an application filed under Sections 202, 203 and 245 of the Code by the respondents. He would further submit that at the said stage of the proceedings the appropriate remedy to be sought, if the order of the learned Magistrate stands vitiated due to lack of territorial jurisdiction, is by filing of an application/petition under Section 482 and not under Section 203 of the Code. He would assert that this aspect of the matter has not been noticed by the High Court while rejecting the petition filed under Section 482 of the Code. In support of his submission, the learned counsel has placed reliance upon a three-Judge Bench decision of this Court in Adalat Prasad v. Rooplal Jindal (2004) 7 SCC 338, wherein this Court has observed that the appropriate remedy to be sought in such stage of proceedings is by way of a petition under Section 482 of the Code.
6. Per contra the learned counsel appearing for the respondents would submit that the learned Magistrate was justified in returning the complaint under Section 201(1) filed by the appellant since the learned Magistrate did not possess the territorial jurisdiction. He would further submit that the decision of this Court in Adalat Prasad (2004) 7 SCC 338, relied upon by the appellant does not notice Section 201 of the Code and thus requires to be declared as per incuriam by this Court.
7. We have heard the learned counsel for the parties to the lis and perused the judgment and order of the courts below.
8. The point that would fall for our consideration and decision is, whether the learned Magistrate was justified in recalling the order passed by him issuing summons to the respondents upon an application made by them under Sections 202, 203 and 245 of the Code.
9. This Court has dealt with the question of recall of a process issued under Section 204 of the Code in Adalat Prasad case (2004) 7 SCC 338 and opined that the Code does not contemplate or provide for any provision affording opportunity to the accused until the issuance of process to him under Section 204. This Court has observed that before issuing summons under Section 204 of the Code the Magistrate must be satisfied that there exists sufficient ground for proceeding with the complaint and a prima facie case is made out against the accused. The said satisfaction should be arrived at by conducting an inquiry as contemplated under Sections 200 and 202 of the Code. The first stage of dismissal of the complaint before the issuance of process arises under Section 203 of the Code, at which stage the accused has no role to play. Subsequent to issuance of process, the question of the accused approaching the court by making an application under Section 203 of the Code for dismissal of the complaint is impermissible because by then the stage of Section 203 is already over and the Magistrate has proceeded further to Section 204 stage.
10. Therefore, the crux of the matter rests into the existence of two different scenarios; the former involving only the complainant's role and the latter introducing the accused. The former constitutes cognizance of the offence on complaint, satisfaction reached by the Magistrate that a prima facie case is made out and thereafter, issuance of process to the accused. It is only after the aforesaid stages are complete; the next stage is triggered enabling the accused to actively participate in the proceedings. The dismissal of complaint by the Magistrate under Section 203 evidently falls into the former stages of proceedings when the Magistrate has to base his opinion as to the existence of sufficient ground for proceeding towards the second stage on the statements of the complainant and the witnesses along with the result of the inquiry conducted under Section 202. It is for obvious reasons that none of the former stages in the Code provide for hearing the summoned accused, the said being only preliminary stages and the stage of hearing of the accused arising at subsequent stages provided for in the latter provisions in the Code. (See Bholu Ram v. State of Punjab (2008) 9 SCC 140.)
11. Having noticed the aforesaid, this Court in Adalat Prasad case (2004) 7 SCC 338 held a contrary view in respect of recalling of erroneous order of issuance of process from the earlier view taken by this Court in K.M Mathew v. State of Kerala (1992) 1 SCC 217 and opined that the scheme of the Code does not provide for review of order of issuance of process and prohibits interference by the accused at the interlocutory stage under Section 203. This Court, after overruling the view expressed by this Court in K.M Mathew case (1992) 1 SCC 217 has stated as under: (Adalat Prasad case (2004) 7 SCC 338)
“15. It is true that if a Magistrate takes cognizance of an offence, issues process without there being any allegation against the accused or any material implicating the accused or in contravention of provisions of Sections 200 and 202, the order of the Magistrate may be vitiated, but then the relief an aggrieved accused can obtain at that stage is not by invoking Section 203 of the Code because the Criminal Procedure Code does not contemplate a review of an order. Hence in the absence of any review power or inherent power with the subordinate criminal courts, the remedy lies in invoking Section 482 of the Code.”
12. The aforesaid law laid down in Adalat Prasad case (2004) 7 SCC 338 has been followed and reiterated by this Court in its subsequent decisions in Bholu Ram case (2008) 9 SCC 140, Subramanium Sethuraman v. State of Maharashtra (2004) 13 SCC 324, N.K Sharma v. Abhimanyu (2005) 13 SCC 213 and Everest Advertising (P) Ltd. v. State (Govt. of NCT of Delhi) (2007) 5 SCC 54. In our view, the issue that we have raised for our consideration and decision is no more a debatable issue in view of what has been stated by a three-Judge Bench of this Court in Adalat Prasad (2004) 7 SCC 338 and therefore, we are of the considered opinion that the High Court is not justified in rejecting the petition filed by the appellant under Section 482 of the Code.
13. In view of the above, while setting aside the impugned judgment 2012 SCC OnLine Kar 4656, (2012) 2 AIR Kant R 406 and order passed by the High Court and the orders passed by the learned Magistrate, we now direct the learned Magistrate to restore the complaint to its Board and proceed with the matter in accordance with law. However, we grant liberty to the respondents herein, if they so desire, to question the jurisdiction of the learned Magistrate, while issuing summons to them, before an appropriate court, including the High Court by filing a petition under Section 482 of the Code. We clarify that all the other contentions of both the parties are left open.
14. Ordered accordingly.
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