AJAY AGARWAL versus UNION OF INDIA AND ORS

Citation: [1993] 3 S.C.R. 543 · Decided: 05-05-1993 · Supreme Court of India · Bench: K. RAMASWAMY · Disposal: Dismissed

Cited by 3 judgment(s) · cites 7 · see the full citation network in Lexace

Judgment (excerpt)

AJAY AGARWAL 
v. 
UNION OF INDIA AND ORS 
MAYS, 1993 
[K. RAMASWAMY & R.M. SAHAI, JJ.] 
Penal Code, 1860-Sections l 20A, 120B-'Conspiracy'-'Criminal 
Conspiracy'-Dejinition-Ingrediems-:-Whether conspiracy p1111ishable as a 
substamive offence and whether comin11i11g offence-Offences in pursuant to 
conspiracy whether separately punishable. 
Code 
of Criminal 
Procedure 
1973-Sectio11 
l88-Whe11 
applicable-Conspiracy hatched at Chandigarh-Part of c011spiracy at 
. Dubai-Overt acts in furtherance of such conspiracy-Sanction not necessary. 
. 
. 
A 
B 
c 
D 
Cbde of Crimi11al Procedure 1973-Section 188, Proviso-
Construction-Requirement:S under. 
Code of Criminal Procedure 1973-Section 188, read with Section, 4 
IPC-Offe11ce by Indian Citizen olllside India-Effect of 
Penal Code, 1860-Section 120A, 120B. 468, .471-Charged 
under-Conspiracy at Chandigarh-Certain overt acts in furtherance of con-
spiracy done ar Dubai-Sanction under Section 188, Cr. P.C. not 
necessary-Jurisdiction of Chandigarh Court-Scope of. 
Penal Code, 1860-Section 120A, 120B, 468, 471-Charged 
under-Conspiracy at Chandigarh-Cerrain Overt acts in fi.trtherance of con-
spiracy done at Dubai /Jy a NRl-Effecr of 
E 
F 
The prosecution case was that the appellant, a non-resident Indian at G 
Dubai, hatched a conspiracy along with four others to cheat tlJe Bank at 
Chandigarh. In furtheram:e of the conspiracy, the appellant got credit facility 
by way of Foreign Letters of Credit and issued proforma invoices of his 
concern and addressed to the Bank through the establishments of other 
accused. The Manager of the Bank, another accused, in confabulation with 
543 
• 
H 
A 
B 
c 
D 
E 
544 
SUPREME COURT REPORTS 
[1993] 3 S.C.R. 
the appellant and other accused, being in-charge of foreign exchange depart· 
ment, issued Foreign Letter of Credit in violation of import policy. The Bills 
of Lading were addressed to the Bank. The cable confirmation of the Bank 
was sent to appellant's concern at Dubai for confirmation of discrepancy. The 
alJpellant confirmed correctness thereof. Placing reliance thereon, authority 
letter was issued by the Bankand cables were sent subsequent thereto to remit 
the amount.; to the Dubai Bank through one Irving Trust Company, At the 
instance of accused Anand, The Dubai Bank informed the Bankat Chandigarh 
that the discrepancy in the document adaptable to accused Anand and 
claimed to have inspected the goods on board in the \'essel. On receipt of the 
information from the appellant's concern at Dubai, full amount is US Dollars 
4,39,200 was credited against all the three Letters of Credit on discount basis. 
The investigation established that the vessel was a non-existent one and 
three Foreign Letters of Credit were fabricated on the basis of false and 
forged shipping documents submitted by the appellant to the Dubai Bank. 
Thus the Bank at Chandigarh was cheated of an amount of Rs. 40,30,329. 
The accused were charge-sheeted under section read with sections 420, 
468, and 471, IPC. 
The Trial Court discharged all the accused of the offences on the ground 
that conspiracy and the acts done in furtherance thereof had taken place 
outside India and. as no sanction under section 188, Code of Criminal 
Procedure 1973 was produced, the prosecution was not maintainable. 
The. High Court. in revision held that the conspiracy fook place at 
F 
Chandigarh and the overt acts committed in pursuance of that conspiracy at 
Dubai constituted offences under sections 420, 467 and 471 IPC., and they 
were triable at Chandigarh without previous sanction of the Central Govt. 
The High Court setting aside the order of discharge of the trial Court, 
directed to continue further proceedings in accordance with law. That order 
of the High Court was challenged under this appeal under Article 136 of the 
G 
Constitution. 
The appellant contended that he was not a privy to the conspiracy and 
the conspiracy did not take place at Chandigarh; and that even assuming that 
some of the offences were committed in India, by operation of Section 188 read 
H 
with the proviso thereto with a non-obstanti clause, absence of sanctidn by the 
~·· 
AJAY AGARWAL v. UNION OF INDIA 
545 
Central Govt. barred the jurisdiction of the Courts in India to take cognisance 
A 
of or to enquil'e into or try the accused. 
The respondents submitted that the conspiracy to cheat the Bank was 
hatched at Chandigarh; that all the accused committed over acts in further-
ance of the 

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