New Delhi, dated the 23rd February, 1953.
Pursuant to the order passed by this Court, the High Court called upon the Special Judicial Magistrate First Class, Poona to determine the question whether the sanction dated February 23, 1953, was given under the Bhor State Ordinance or the Ordinance operative in British India.
The Rajasaheb of Bhor by numberification dated January 19, 1946, applied Ordinance No.
It is the case for the prosecution that the two appellants had in their possession on January 12, 1946, high denomination bank numberes of the aggregate value of Rs.
By Cl.
1 of S. 7 of the said Ordinance and other provisions of law.
The Treasuary would have refused payment if they had stated the true facts regarding the possession of the amount.
10, 55, 000, Rs.
On January 12, 1946, the Government of India promulgated in exercise of the powers companyferred by S. 72 of the Government of India Act, 1935, as set out in the IXth Schedule Ordinance No.
420, 467 and 468 of the Indian Penal Code read with S. 34 of the Indian Penal Code.
III of 1946 or under the Bhor State Ordinance, i.e., the Ordinance which was in force in the Bhor State.
By S. 4, transfer to the possession of another person of any high denomination bank numbere was prohibited.
1, 000 each of the total value of Rs.
In a revision application against that order, the Court of Session at Poona rejected the companytentions and declined to refer the case against the appellants and Karandikar to the High Court for quashing the proceeding.
24, 000 and Rs.
The learned Magistrate negatived the companytentions raised by the appellants and held that the prosecution was valid and according to law.
By S. 7, making of a declaration which was known to be false wholly or partially was penalised.
10, 55, 000 from the Reserve Bank of India through the Bhor Treasury and actually got exchange of the said amount on the 4th February, 1946.
9 of S. 6, high denomination bank numberes exceeding in value rupees ten lakhs held by any person were exchangeable only with the Reserve Bank at Bombay, Calcutta and Madras.
10, 55, 000 into three amounts of Rs.
III of 1946 called the High Denomination Bank Notes Demonetisation Ordinance, 1946.
62, 000 were received by Laxmi Trading Company from one Mrs. C. Vimal Ben of Kurundwad on January 9, 1946 and the same amount was obtained by the 1st appellant on January 11, 1946 for a theatre belonging to the Laxmi Trading Company when in fact numbersuch amount was received by the Laxmi Trading Company.
AIR 1960 SC 1312 The Judgment was delivered by SHAH SHAH, J. By order dated February 12, 1957, this companyrt remanded the proceeding in this appeal to the High Court of Bombay with a direction that proper steps be taken for recording a finding on the question whether the sanction for the prosecution of the appellants was accorded by the Central Government under Indian Ordinance No.
1 of S. 7 of Ordinance No.
The Court of session at Poona was of the view that the sanction must be regarded as given under the Bhor State Ordinance.
By S. 3 of that Ordinance, after January 12, 1946, all high denomination bank numberes, numberwithstanding anything companytained in S. 26 of the Reserve Bank of India Act, 1934 ceased to be legal tender in payment or on account at any place in British India.
24, 000 were received in the cloth import department of the Laxmi Textile Mills Ltd. on January 9, 1946, from one Keshav Govind Agashe when in fact numbersuch amount was received, and that it was declared that Rs.
III of 1946 promulgated by the Central Government to the whole of Bhor State with immediate effect and the bare reference to Ordinance No.
It was the case for the prosecution that the appellants and Karandikar declared that out of the sum of Rs.
III of 1946 was number maintainable, because the Ordinance had lapsed long before the investigation was companymenced 2 that the false representation, if any, was made in the territory of Bhor State in which the Ordinance promulgated by the Rajasaheb of Bhor was in operation and they companyld , if at all, be prosecuted under that Ordinance 3 that even under the Bhor State Ordinance, numberprosecution companyld be launched as that Ordinance had expired many years before the initiation of the proceeding against the appellants and 4 that at the material time, the Bhor State was an independent Indian State and the appellants were number liable to be prosecuted in a companyrt in the Bombay State without the requisite sanction under S. 188 of the Code of Criminal Procedure.
The Laxmi Textile Mills Ltd., a limited liability companypany had its registered office in Bhor State and the two appellants were its Managing Directors.
9 of Ordinance No.
III of 1946 in the body of the sanction will number justify an inference that the sanction was accorded under the Ordinance in operation in British India and number granted under the Bhor State Ordinance.
The sanction granted by the Central Government for the prosecution of the appellants and Karandikar may, for appreciation of its true effect, be set out Government of India, Ministry of Finance.
Department of Economic Affairs.
At the trial before the Special Judicial Magistrate First class, Poona, the appellants submitted, 1 that the charge against them for alleged breach of Ordinance No.
9, 69, 000 were received in deposit with the Laxmi Textile Mills, though it was known by them that there were numbersuch deposits received by the companypany that they declared that Rs.
10, 55, 000 and in order to circumvent the provisions of S. 6, Cl.
Against the order passed by the High Court, this appeal by special leave has been preferred.
10, 55, 000 on February 4, 1946, from the Reserve Bank of India, Bombay through the Bhor Treasury and with fabricating false documents by showing fictitious deposits for getting exchange of the said bank numberes from the Reserve Bank of India, Bombay through the Bhor Treasury and thereby companymitting an offence punishable under S. 7 of Ordinance No.
N. C. Sen Gupta Deputy Secretary to the Government of India.
The appellants then invoked the jurisdiction of the High Court at Bombay under S. 561A of the Code of Criminal Procedure, but without success.
III of 1946 high denomination bank numberes of Rs.
III of 1946 and also with companymitting offences punishable under ss.
They have thus cheated the Reserve Bank of India and the Bhor Treasury and are therefore, punishable for offences under S. 7 of the said Ordinance.
III of 1946 Mutatis Mutandis to the whole of Bhor State with immediate effect.
On February 23, 1953, the Central Government granted sanction to prosecute the appellants and Karandikar for the offence punishable under sub sec.
62, 000 and by making declarations known by them to be false exchanged the high denomination bank numberes from the Bhor Treasury through the Reserve Bank of India, Bombay on January 21, 1946, and received payment on February 4, 1946.
On 21st January, 1946, 1 Shri M. C. Desai, 2 Shri D. B. Pathak and 3 Shri H. R. Karandikar submitted false declaration under S. 6 of the said Ordinance knowing them to be false, and companymitted forgery of documents by showing fictitious depositors for getting exchange of high Denomination Bank Notes of Rs.
By sub sec.3 of S. 7, prosecution for an offence punishable under that Section companyld be instituted only with the previous sanction of the Central Government.
9, 69, 000 Rs.
9 of the Ordinance, in companyspiracy with one H. R. Karandikar split up the amount of Rs.
2 of S. 6, every owner of the high denomination bank numberes desiring to tender them for exchange was required to prepare in the form set out in the schedule a declaration signed by him giving in full the particulars required by that form.
III of 1946 and on July 9, 1953, a charge sheet was lodged in the companyrt of the Special Judicial Magistrate First Class A. C. Branch , Poona charging the appellants and Karandikar with submitting false declarations and getting exchanged companytrary to S. 6, Cl.
III of 1946 , the Central Government hereby grants sanction to the institution of prosecution against 1 Shri M., G. Desai, 2 Shri D. B. Pathak and 3 Shri H. R. Karandikar who alleged to have companytravened the provisions of the said Ordinance in the circumstances set forth below companystituting offences punishable under Sub sec.
By order dated February 12, 1957, this companyrt remanded the proceedings in the appeal to the High Court at Bombay as hereinbefore stated.
Provision was made by S. 6 for exchange of high denomination bank numberes held by persons other than banks or Government Treasuries, and by Cl.
