Abhinav Goyal v. Greyb Consultancy Service Ltd.
In the Punjab & Haryana High Court
CCRM-M-36473/2011 (O&M)
Before Justice P.P. Nagarath
Decided on December 11, 2013

Relevancy of the case: Applicability of Section 202 CrPC in a corporate data theft case

Statutes & Provisions Involved

• The Information Technology Act, 2000 (Section 72)
• The Indian Penal Code, 1860 (Section 379, 406, 120B)
• The Code of Criminal Procedure, 1973 (Section 482, 202(1))

Relevant Facts of the Case

• The respondent filed a complaint against the petitioners under Section 72 of the Information Technology Act, 2000 and Sections 406, 120B and 379 of the Indian Penal Code, 1860. The petitioners were working as a senior research analyst and a research analyst in the company owned by the respondent. They were mainly involved in the confidential technical research of inventions by the company’s clients and also carried on research on patent drafting, copyright, trademark and registration of new products for some foreign clients of the company.
• A new database worth Rs. 1,75,000 was installed in the respondent’s company which was mainly required for research works. This was exclusively for the research purpose for the employees of the company. All employees including the petitioners were given user name and password to use the database. The petitioners had signed an invention and confidentiality agreement. As per clause 2.3 of the agreement signed by the petitioners, they were not allowed to disclose any details or use the data in such a way as to cause loss to the respondent’s company directly or indirectly.
• Both the petitioners hatched a criminal conspiracy against the company after getting access to the database. The petitioners illegally downloaded the details from the mail to their pen drives for their use.
• On 13-11-2009, they started their own company with the name Stellarix Consultancy Services Pvt. Ltd., while they were already employees of the respondent company and hence committed an offence under Section 406 of the Indian Penal Code.
• On 11-05-2010 and 14-01-2010, the petitioners submitted their resignation letters, as the respondent came to know about the theft. The resignation was kept in abeyance since the company was checking the theft committed by them. It was found that there was a loss of 10 lakhs due to this theft.
• After recording the statement of the director of the respondent company, the Magistrate held the petitioners to be liable under Section 72 of the Information Technology Act, 2000 and Sections 406, 120B and 379 of the Indian Penal Code, 1860.
• The petitioner filed a petition for quashing the (Annexure P-1) complaint number 107 dated 30-07-2010 under Section 482 of the Criminal Procedure Code, 1973.

Prominent Arguments by the Advocates

Mr Rohan Mittal, the petitioners’ counsel:

• He submitted that the order should not have been passed by the Magistrate at Panchkula without holding a proper inquiry under Section 202(1) of the Code of Criminal Procedure, 1973, since the petitioners were residing beyond the Magistrate’s jurisdiction. There is no applicability of Section 210 of the Code of Criminal Procedure stated in the complaint, as it was investigated by the police and nothing could have been found. It was argued that there was no proper evidence to prove prima facie offence for which they were summoned. The petitioners also have bought a database worth 2,25,000 for their company and there was no need for them to steal the respondent’s database.

Mr J.S. Bhatia, the respondent’s counsel:

• The counsel for the respondent submitted that the Magistrate has complied with the provisions of Section 202(1) of the Code of Criminal Procedure, 1973. He further submitted that the respondent is the witness of the complaint and it would be sufficient to comply with Section 202(1).

Opinion of the Bench

• The court found substance in the contentions made by the learned counsel for the petitioners. The court held that the Magistrate without complying with Section 202 of the Code of Criminal Procedure, 1973 have issued the process against the petitioners. Both the petitioners are residents of Jaipur in Rajasthan as per the instant petition, which is beyond the jurisdiction of the court of Panchkula. The Magistrate had the obligation of finding out whether there is any matter for investigation left to enquire and whether there were sufficient grounds for proceedings against the petitioners. The court held that for this reason, the order of the Magistrate will not sustain.

Final Decision

• The impugned order made on 16-10-2010 is set aside.
• The court asked the matter to be remitted to the Magistrate and directed to proceed according to the law.

This case summary has been prepared by Afsana Khan, an undergraduate student at Symbiosis Law School, Hyderabad, during her internship with The Cyber Blog India in June/July 2020.