No Intent to Cause Damage or Injury or to Commit Fraud in Making of Website Found, Proceedings Quashed

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RAMESH RAJAGOPAL (THE APPELLANT) WAS PROSECUTED BY Devi Polymers Private Limited (the respondent) under Sections 409, 468 and 471 of the Indian Penal Code (IPC) read with Sections 65 and 66 of the Information Technology Act, 2000 read with Section 120(b) of the IPC. The appellant is a Director in Devi Polymers Private Limited, Chennai which is a leader in Polyester Moulding Compound (PMC), Sheet Moulding Compound (SMC) and Dough Moulding Compound (DMCO) in India.
It is has three Units – A, B and C. Unit ’C’ is being headed by the appellant. It is not disputed that the Unit ’C’ primarily renders consultancy services. However, all the three Units are units of one entity i.e. Devi Polymers Private Limited.
In the course of business, the appellant though of improving the consultancy services and apparently contacted a consultant known as Michael T. Jackson. He also contacted the regular consultants of the Company i.e. Devi Polymers Private Limited. The consultants apparently advised the creation of a separate entry known as Devi Consultancy Services and accordingly, in the web page that was created by the consultant, this name occurred. Since an invoice was raised by the consultant Michael T. Jackson in the sum of 10,857.50 US Dollars, the said amount was paid from the funds of Devi Polymers Private Limited amounting to Rs. 5,57,207/-. The amount of Rs. 17,000/- has been paid by the Devi Polymers Private Limited to M/s Easy Link. These amounts were paid as advised by the appellant. It is significant that no amount has been paid or received by Unit C separately, independently of Devi Polymers Private Limited. All this, namely the engaging of consultants and payments to them was apparently done at the behest of the appellant.
The relationship being strained between the respondent and the appellant, who are relatives, several proceedings seem to have been initiated in the Company Law Board pertaining to oppression and mismanagement. As of now, it is said that the appellant’s petition for mismanagement has been dismissed but an appeal is pending.
However, in the course of disputes and the pending proceedings, the respondent initiated the instant criminal complaint against the appellant. The main circumstances which are relied upon by the respondent in the complaint is that in the website for Devi Consultancy Services that as created on the advice of the consultant is shown as a separate division independent of Devi Polymers Private Limited. According to the complainant, this has resulted in forgery, since there is no such thing as Devi Consultancy Services; though the existence of Unit C of Devi Polymers Private Limited, which deal with consultancy is not denied. The second circumstances seems to be the payment made by the Devi Polymers Private Limited to the consultants from their own account. The former is said to be forgery and the latter is said to be mis-appropriation of funds and breach of trust.
The High Court seems to have overlooked various circumstances and dismiss the petition under Section 482 of the Criminal Penal Code on the ground that it requires evidence at a trial to come to any conclusion.
Against the judgement of the High Court special leave petition was filed. The Supreme Court accepted the appeal and quashed the prosecution.
The operative part of the judgement read as under :
As far as the website is concerned, though undoubtedly, Devi Consultancy Services (DCS) is mentioned, it is made clear in the website itself that DCS is a part of Devi Polymers Private Limited which is apparent from a link which shows Devi Polymers Private Limited, in the website itself, are shown as Devi Polymers Privet Limited, the main Company and Devi Consultancy Services as a sister Company. Similarly, in the website of Devi Polymers Private Limited, which was moved by the consultant, there is a link which shows that Devi Consultancy Services is sister concern and it is stated that viewers may visit that site. The address of Devi Consultancy Services is shown to be the same address as that of Devi Polymers Private Limited. We are satisfied that there is no attempt whatsoever to project the Devi Consultancy Services as a concern or a Company which is independent and separate from Devi Polymers Private Limited, to which both the parties belong. In any case it is not possible to view the act as an act of forgery.
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It might have been possible to attribute some criminal intent to the projection of the Unit C as Devi Consultancy Services in the website, if as a result of such projection, the appellant had received any amounts separate from the Devi Polymers Private Limited, but a perusal of the complaint shows that this is not so. Not a single rupee has been received by the appellant in his own name or even separately in the name of Unit C, which he is heading. All amounts have been received by Devi Polymers Private Limited.
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It is not possible to view the contents of the website showing the Devi Consultancy Services as a concern which is separate from Devi Polymers Private Limited in view of the contents of the website described above. Moreover, it is not possible to impute any intent to cause damage or injury or to enter into any express or implied contract or any intent to commit fraud in the making of the said website. The appellant has not committed any act which fits the above description. Admittedly, he has not received a single rupee or nor has he entered into any contract in his own name on the basis of the above website. TTTTTTT
In the absence of any act in pursuance of the website by which he has deceived any person fraudulently or dishonestly, induced any one to deliver any property to any person, we find that it is not possible to attribute any intention of cheating which is a necessary ingredient for the offence under Section 468.
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We find that the allegations that the appellant is guilty of an offence under the aforesaid section are inherently improbable and there is no sufficient ground of proceedings against the accused. The proceedings have been initiated against the appellant as a part of an ongoing dispute between the parties and seem to be due to a private and personal grudge.
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As regards the commission of offences under the Information Technology Act, 2000 the allegations are that the appellant had, with fraudulent and dishonest intention on the website of Devi Consultancy Services i.e. www.devidcs.com that the former is a sister concern of Devi Polymers. Further, that this amounts to creating false electronic record. In view of the finding above we find that no offence is made out under Section 66 of the I.T. Act, read with Section 43. The appellant was a Director of Devi Polymers and nothing is brought on record to show that he did not have any authority to access the computer system or the computer network of the company. That apart there is nothing on record to show the commission of offence under Section 65 of the I.T. Act, since the allegation is not that any computer source code has been concealed, destroyed or altered. We have concealed, destroyed or altered. We have already observed that the acts of the appellant did not have any dishonest intention while considering the allegations in respect of the other offences. In the circumstances, no case is made out under Sections 65 and 66 of the I.T. Act, 2000.
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Reference : Supreme Court. Ramesh Rajagopal v. Devi Polymers Private Limited, criminal appeal no. 133 of 2016.