Facts of the Case

The petitioner, Potta Suresh, filed the Criminal Petition seeking quashing of F.I.R. No. 212 of 2022 dated 21 August 2022, registered at Ramabhadrapuram Police Station, Vizianagaram District.

The FIR was registered with reference to Sections 41 and 102 Cr.P.C. on the basis of a complaint given by the second respondent, who was the Sub-Inspector of Police of the concerned Police Station.

According to the prosecution, acting upon reliable information on 21 August 2022, the police reached a Commercial Complex near Water Plant Godown at Ramabhadrapuram and allegedly found the petitioner in possession of tobacco stock.

As specifically recorded in the order, the seized stock comprised:

  • 6 plastic bags of Miraj Super Swadeshi Tobacco, stated to contain a total of 6,300 pouches valued at ₹94,500;
  • 5 plastic bags of Mind Free Readymade Khaini Uttam Tobacco, stated to contain 5,000 pouches valued at ₹25,000;
  • 13 plastic bags of RK Deluxe Mix Swad, valued at ₹3,90,000;
  • 5 plastic bags of RR Tobacco, valued at ₹25,200;
  • 2 boxes of Raja Khaini, valued at ₹20,000; and
  • 6 plastic bags of Dilkush Bangu, valued at ₹8,000.

The total seizure was recorded as 35 plastic bags and 2 boxes worth ₹5,72,700.

According to the prosecution version, proper documents such as receipts, invoices and GST-related documents were not available, and the goods were treated as unclaimed. The police seized the stock and registered Crime No. 212 of 2022.

Aggrieved by registration of the FIR, the petitioner approached the Andhra Pradesh High Court seeking quashing of the criminal proceedings and return of the seized tobacco products.

Issues Involved

The principal issues before the High Court were:

  1. Whether an FIR could legally be registered merely with reference to Sections 41 and 102 Cr.P.C. when the occurrence report did not disclose commission of any substantive offence.
  2. Whether Section 41 Cr.P.C., which deals with circumstances in which police may arrest without warrant, itself constitutes an offence-creating provision capable of supporting registration of an FIR.
  3. Whether Section 102 Cr.P.C., concerning police power to seize certain property, independently authorises registration of an FIR in the absence of disclosure of a cognizable or non-cognizable offence.
  4. Whether mere possession, transportation or sale of tobacco products constituted a crime under the statutory enactments referred to by the Court.
  5. Whether absence of receipts, invoices or GST documents by itself justified registration of the impugned FIR under Sections 41 and 102 Cr.P.C.
  6. Whether an FIR based merely on suspicion and seizure of tobacco products could be sustained when there was no complaint alleging that the goods were stolen.
  7. Whether the Madras High Court ruling in Ramesh vs State and Another justified the registration of the FIR in the present factual circumstances.
  8. Whether the seized tobacco stock should be returned to the petitioner after quashing of the FIR.

Petitioner’s Arguments

The petitioner’s counsel contended that a reading of the Occurrence Report did not disclose commission of any offence.

It was argued that Section 41 Cr.P.C. merely contemplates situations in which a police officer may arrest a person without an order from a Magistrate and without a warrant.

Similarly, Section 102 Cr.P.C. merely deals with the power of a police officer to seize certain property in the circumstances specified by law.

The petitioner therefore argued that Sections 41 and 102 Cr.P.C. are provisions concerning police powers and procedure, and that registration of an FIR under those provisions, without reference to the commission of any offence, was wholly unsustainable in law.

The petitioner’s counsel further submitted that the Andhra Pradesh High Court had already quashed numerous FIRs and charge sheets relating to tobacco products, yet police authorities continued to register such crimes.

Reliance was placed upon:

  • Criminal Petition No. 583 of 2022, decided on 11 April 2022, where, according to the petitioner, FIRs registered with reference to Sections 41 and 102 Cr.P.C. were quashed; and
  • Criminal Petition No. 4964 of 2021, decided on 3 September 2021.

The petitioner also argued that the seized tobacco products were perishable in nature and requested the Court to direct their release.

Respondent’s Arguments

The learned Assistant Public Prosecutor opposed the petition.

The prosecution argued that the police were empowered to register the FIR under Section 102 Cr.P.C. because the petitioner had failed to produce documents proving ownership of the seized stock.

According to the respondent, registration of the FIR was therefore legally sustainable.

The prosecution relied upon the Madras High Court decision in:

Ramesh vs State and Another

Crl.O.P. No. 5190 of 2021 and Crl.M.P. No. 3332 of 2021, decided on 17 March 2021

On that basis, it was contended that the Criminal Petition lacked merit and should be dismissed.

Court Order / Findings

The Andhra Pradesh High Court allowed the Criminal Petition and quashed the FIR.

The Court observed that several cases had previously been disposed of by different Benches of the High Court by quashing FIRs and charge sheets registered against persons transporting, possessing or selling tobacco products under provisions of:

  • the Indian Penal Code;
  • the Cigarettes and Other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Act, 2003; and
  • the Food Safety and Standards Act, 2006.

The Court noted that those decisions had, inter alia, held that possession, transportation or sale of tobacco products would not constitute a crime under the referred enactments.

The Court therefore held that registration of an FIR, in the absence of any complaint alleging that the products were stolen or merely on suspicion, was not warranted.

The Court stated the central legal requirement:

The FIR must disclose commission of an offence.

The Court further held that, in light of the conclusion that possession of tobacco products would not constitute an offence under the referred statutes, registration of an FIR on mere suspicion and seizure of tobacco products was not sustainable in law.

Accordingly, the Court:

  • allowed the Criminal Petition;
  • quashed F.I.R. No. 212 of 2022 registered against the petitioner;
  • directed the Station House Officer, Ramabhadrapuram Police Station, to return the tobacco products seized in connection with the FIR to the petitioner; and
  • closed all pending applications.

Important Clarification

The judgment should not be read as holding that tobacco products can never be the subject matter of criminal proceedings under any circumstances.

The precise reasoning of the Court was based on the facts and statutory basis of the impugned FIR. The FIR had been registered with reference to Sections 41 and 102 Cr.P.C., while the Court found no disclosed commission of an offence sufficient to sustain the criminal case.

The judgment makes an important distinction between:

  • procedural or police-power provisions, such as provisions concerning arrest and seizure; and
  • the legal requirement that information forming the basis of an FIR must disclose commission of an offence.

The Court also specifically reasoned that, in the absence of a complaint that the tobacco products were stolen, or where action was based merely on suspicion, registration of the FIR was not warranted.

A further significant clarification is that mere seizure of property does not automatically establish commission of an offence. The FIR must have a legally sustainable foundation disclosing criminality.

The order also does not determine any independent tax assessment or GST liability. Although the prosecution narrative referred to absence of receipts, invoices and GST-related documents, the High Court’s decision concerned the legality of the FIR registered with reference to Sections 41 and 102 Cr.P.C.

Sections / Provisions Involved

Section 41 of the Code of Criminal Procedure, 1973 – Arrest Without Warrant

The petitioner argued that Section 41 Cr.P.C. sets out circumstances in which a police officer may arrest a person without an order from a Magistrate and without a warrant.

The Court considered the contention that this provision concerns police powers and procedure and cannot, without disclosure of an offence, independently sustain registration of an FIR.

Section 102 of the Code of Criminal Procedure, 1973 – Power of Police Officer to Seize Certain Property

This was a central provision in the dispute.

The prosecution sought to justify registration of the FIR on the ground that the petitioner had failed to produce ownership documents for the seized stock.

The Court ultimately found the FIR unsustainable in the factual circumstances because possession of tobacco products, as discussed in the order, did not constitute an offence under the referred enactments, and an FIR could not be sustained merely on suspicion and seizure.

Section 102(3) Cr.P.C.

This provision arose while the Court distinguished the Madras High Court ruling in Ramesh vs State and Another. In that case, a report concerning seizure of money had been sent to the Magistrate in compliance with Section 102(3) Cr.P.C.

Section 154 Cr.P.C. – Information in Cognizable Cases

The Andhra Pradesh High Court referred to the reasoning in Criminal Petition No. 4964 of 2021, which explained that registration of an FIR under Section 154 Cr.P.C. requires information disclosing commission of a cognizable offence.

The cited reasoning further noted that, even in relation to a non-cognizable offence, the police must follow the legally prescribed procedure, including obtaining prior permission from the concerned Magistrate before proceeding according to law.

Section 107 Cr.P.C.

This provision arose in the context of Criminal Petition No. 4964 of 2021, where an FIR registered under Section 107 Cr.P.C. had been quashed and the Court discussed the basic legal requirements for FIR registration.

Section 171-E of the Indian Penal Code

This provision was discussed while distinguishing the Madras High Court decision in Ramesh vs State and Another. In that case, after investigation concerning seized unaccounted money, police considered that the materials prima facie constituted an offence punishable under Section 171-E IPC.

Cigarettes and Other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Act, 2003

The High Court referred to earlier cases concerning FIRs and charge sheets against persons transporting, possessing or selling tobacco products under this enactment.

Food Safety and Standards Act, 2006

The Court also referred to earlier decisions concerning criminal proceedings relating to tobacco products under this enactment.

Link to download the order - https://mytaxexpert.co.in/uploads/1783335297_1143compressed.pdf

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