Calcutta High Court (Appellete Side)
M/S Mercedes Benz India Pvt. Ltd vs The State Of West Bengal & Anr on 23 July, 2025
Author: Jay Sengupta
Bench: Jay Sengupta
IN THE HIGH COURT AT CALCUTTA
CRIMINAL REVISIONAL JURISDICTION
APPELLATE SIDE
Present:
The Hon'ble Justice Jay Sengupta
CRR 413 of 2020
CRAN 3 of 2022
CRAN 4 of 2022
CRAN 5 of 2023
In the matter of :- M/s Mercedes Benz India Pvt. Ltd.
Vs.
The State of West Bengal & Anr.
For the petitioner : Mr. Anshuman Sinha,
Mr. Udayan Sinha,
Mr. Basabraj Chakraborty,
Mr. Satyaki Chaudhuri
Mr. Indrajit Roy
.....Advocates
For the OP No.2 : Mr. Ankit Agarwal,
Mr. Nilay Sengupta,
Mr. Sujit Banerjee.
.........Advocates
Heard lastly on : 28.03.2025
Judgment on : 23.07.2025
Jay Sengupta, J:
1. This is application praying for quashing of the proceeding in Complaint
Case No. 74 of 2019 under Section 420 read with Section 120B IPC pending
2
before the learned Judicial Magistrate, 4th Court, Purulia including the order
dated 6th December, 2019 passed therein.
2. Learned counsel appearing on behalf of the petitioner submitted as
follows. The respondent No. 2 filed Complaint Petitioner No. 74 of 2019
under Section 200 Cr.P.C. in the month of July, 2019 before learned Chief
Judicial Magistrate, Purulia alleging, inter alia, that the accused persons
sold a second-hand car instead of a new car in conspiracy with others and
thereby, cheated the respondent. Altogether nine persons were named as
accused including petitioner herein who had been arrayed as accused No. 2.
The statement of Saurav Dokania, DGM of the Complaint Company was
recorded on S/A under Section 200 Cr.P.C. on 07.09.2019. The statement of
Naresh Kumar Agarwal Managing Director of Complainant Company was
recorded. The statement of Manjit Kumar Singh, Manager Legal of
Complainant Company was also recorded. Learned Trial Court vide order
dated 30.10.2019 directed In-charge, Purulia Mufassil PS to investigate or
cause to investigate the matter by some other competent police officer
subordinate to him. Learned Trial Court upon receipt of report from In-
charge, Purulia Mufassil PS and upon going through the statements of
complainant and witnesses, vide order dated 06.12.2019 took cognizance of
the offences punishable under Section 420 read with Section 120B IPC and
issued summons to eight accused persons including the present petitioner.
The petitioner Company received the aforesaid summons dated 03.01.2020
for appearance on 10.01.2020. The petitioner filed the present CRR No. 413
of 2020 seeking relief as prayed for in the prayer clause. The respondent
3
No.2/Complainant was a company registered under Companies Act 1956
having its office and manufacturing unit at Bongabari, PS Purulia, District
Purulia. The Respondent Company was engaged in manufacturing of port
land slag cement at Purulia. The respondent No.2 through its AR approached
Accused No.1 “Benchmark Intercrafts” the authorized dealer of Petitioner
Mercedes-Benz India Pvt. Ltd. which was the manufacturer of Mercedes Benz
passenger vehicle for purchase of a car. The representative of Respondent
No.2 was explained about model/price and features of cars present with the
dealer i.e., full cooperation was extended to the Complainant Company in
purchasing the vehicle. The representative of Respondent No.2 decided to
purchase Model B-200D Sports Vehicle (Diesel) and placed the order by
paying down payment of Rs.3 Lacs in favour of the dealer by way of cheque
on 14.06.2017. That the dealer issued proforma invoice in favour of
Respondent No.2 quoting the rate of desired vehicle. Subsequently, an
amount of Rs. 29,11,500 was also released in favour of the dealer by the
Complainant’s banker. An additional Rs. 1,81,896 was also paid towards the
registration cost. The Complainant took possession of the B-200D Sports Car
from the dealer on 18.12.2017. It was alleged that the Complainant came to
know through a close acquaintance that he was boarding a second hand
vehicle, which originally belonged to one Shanti Kumar Surana. Upon
instructions from the Managing Director. Witness No. 4. Manjit Singh
enquired into the matter and came to know that the said vehicle stood
registered in the name of Shanti Kumar Surana and the same continued till
12.02.2018. On 07.02.2019 the respondent No.2 wrote an email to the
4
Petitioner stating its grievances which was forwarded by the Petitioner
company to the dealer. That Respondent No.2 filed Complaint Petition No.74
of 2019 in the month of July 2019, alleging inter alia that the Complainant
was sold a second-hand car instead of a new car by the dealer in conspiracy
with other accused persons including the present Petitioner who has been
arrayed as Accused No.2. It was alleged that on 20.12.2008 the Complainant
came to know that the aforesaid car originally belonged to one Shanti Kumar
Surana. It has further been alleged that all the accused persons in
conspiracy with each other sold and delivered a second-hand used vehicle to
the complainant and thereby committed the offence of criminal conspiracy
and cheating. The name of the Petitioner Company figured in Para 4 and
Para 13 of the Complaint which read as follows: Para 4 – passenger “Accused
No.2 is the manufacturer of Mercedes Benz vehicle.” Para 13 – “Accused No.
3, 4, 5, 6, 7 and 8 representing accused No. 1 and 2 met the complainant in
early part of June 2017 and assured to deliver a brand-new vehicle.” In
addition to the aforesaid the name of the Petitioner figured in the statements
of Witness No.1 and Witness No.4, which read as under. Witness No.4 in his
email dated 07.02.2019 communicated in detail all about the vehicle and
deception caused to the complainant company in respect of vehicle bearing
no. WB-02AL-4646 to the Managing Director of Mercedes Benz India Pvt. Ltd.
Save and except the aforesaid there was no reference about the Petitioner
either in the complaint or in the statements of witnesses. The Petitioner M/s
Mercedes Benz India Pvt Ltd was a company involved in the business of
manufacturing luxury automobiles and was considered as one of the world
5
leaders in the automobile industry. It was a world-renowned brand and had
been established in India by a German Multinational company namely,
Daimler AG. M/s Landmark Cars (East) Pvt Ltd was an authorized dealer of
the Petitioner company for the sale and after sale service of its car at Kolkata.
At the time of appointment of dealers, an agreement was signed between the
manufacturer and the authorized dealer which contained all the terms and
conditions including the liabilities and responsibilities of each of the parties
against each other and against the customer/purchaser. The petitioner
company had given dealership on principle-to-principal basis. The vehicles
were billed to the dealer and the dealer used to sell it to the customers.
Hence, there was no role of Petitioner company with respect to sale of
vehicles to customers. This arrangement held the dealer solely responsible
from the dealings with the buyers. The manufacturers under no
circumstances could be made liable in any manner for a transaction between
the Dealer and the Customer. During the relevant period there was a
software called “E-Vendor” which contained the details of vehicle sold by
each vendor/dealership, meaning thereby when any vehicle was sold it got
updated in the software. The IT team of Petitioner Company was having
access to the aforesaid software. However, no pop-up or intimation message
got generated when any sale was updated in the software. The aforesaid
process was merely for keeping records. The officials did not check the
details of each and every sale of vehicle as there was no requirement. As
regards re-sale of the vehicle the same got updated vehicle first time went to
the service center. Unless and company was appraised about any such
6
discrepancy in the mechanism by which the aforesaid fact would have come
to the knowledge of the company. There was no material available either in
the complaint or in the statement of witnesses to show that the present
petitioner was having knowledge about the alleged second hand sale of the
vehicle. The petitioner company was not involved in the alleged offence in any
manner whatsoever. There was no communication between the Petitioner
and the Complainant/ Respondent No.2 prior to or during the sale of the
concerned vehicle. Hence, the question of representation of the Petitioner did
not arise at all and in absence of any representation question of having any
knowledge about the falsity of representation did not arise. The Hon’ble
Supreme Court in Tata Motors Ltd. v. Antonio Paulo Vaz and Ors 2021 SCC
Online SC 125 held as under: “30……….Unless the manufacturer’s knowledge
is proved, a decision fastening liability upon the manufacturer would be
untenable, given that its relationship with the dealer, in the facts of this case,
were on principal-to-principal basis.” The Hon’ble Supreme Court in the case
of Honda Cars India Limited v. Sudesh Berry 2021 SCC Online SC 1313 held
as under: “5. The matter was considered by the District Forum and insofar
as the liability of the present appellant is concerned, it was observed thus:
“So far as OP-II is concerned, we find no material on record to fasten any
liability for the conduct of the O.P.-I and O.P.-III with whom O.P.-II have
allegedly only principal relationship.” The Hon’ble Supreme Court in Pepsi
Foods Ltd. v. Special Judicial Magistrate (1998) 5 SCC 749, Fakhruddin
Ahmad v. State of Uttaranchal (2008) 17 SCC 157, Mehmood Ul Rehman v.
Khazir Mohammad Tunda (2015) 12 SCC 420, Sunil Bharti Mittal v. CBI
7(2015) 4 SCC 609 and Ravindranatha Bajpe v. Bangalore Special Economic
Zone Ltd. Criminal Appeal Nos. 1047-1048/2021 made a distinction on
application of mind by the judge for the purpose of taking cognizance based
on a police report on the one hand and a private complaint under Section
200 Cr.P.C. on the other, and that the requirement of a demonstrable
application of mind in the latter case was higher as was held by Hon’ble
Supreme Court in Bhushan Kumar v. State (NCT of Delhi) and State of
Gujarat v. Afroz Mohammed Hasanafatta. The Hon’ble Supreme Court in
Pepsi Foods Ltd. v. Special Judicial Magistrate having noticed that
proceeding had been initiated on the basis of a complaint, held that
“Summoning of an accused in a criminal case is a serious matter. Criminal
law cannot be set into motion as a matter of course. The order of the
Magistrate summoning the accused must reflect that he has applied his
mind to the facts of the case and the law applicable thereto. He has to
examine the nature of allegations made in the complaint and the evidence
both oral and documentary in support thereof and would that be sufficient
for the complainant to succeed in bringing charge home to the accused.” The
Hon’ble Supreme Court vide order dated 27.11.2011 passed in Criminal
Appeal No. 1868 of 2011 in a matter titled as M/s Thermax Ltd. & Ors. Vs
K.M.Johny & Ors. while dealing with the issue of vicarious liability in a
criminal proceeding held that vicarious liability was unknown to criminal
law. The Hon’ble Supreme Court laid down the principle regarding invoking
of inherent power under Section 482 Cr.P.C. in State of Haryana & Ors. Vs
Bhajanlal Citation AIR 1992 SC 604 and the instant case fell under the 1st
8and 3rd category of cases. The Hon’ble Supreme Court in the matter titled as
Lovely Salhotra & Ors. Vs State of NCT of Delhi & Ors. Citation (2018) 12
SCC 391 allowed even partial quashing of FIR. The Hon’ble High Court of
Punjab & Haryana at Chandigarh in the matter titled as Anguri Devi etc. Vs
State of Punjab etc Citation 2011 (2) RCR (Criminal) 431 allowed partial
quashing of FIR. The Hon’ble Supreme Court in yet another case titled as
Surendra Kumar Bhatia Vs Kanhaiya Lal & Ors. Citation (2009) 12 SCC 184
upheld partial quashing of FIR.
3. Learned counsel appearing on behalf of the complainant/opposite
party submitted as follows. The complainant had ordered a “new” car,
manufactured by the petitioner, through its dealer. Subsequent to its
purchase, it was revealed that said car was a not a new one, but a second
hand car. It was first registered in the name of one Shanti Surana.
Thereafter, the petitioner and the dealer and their officers had committed
fraud with the Motor vehicle department and had re-registered the same in
the name of defacto complainant and managed to destroy the file lying with
the Govt department. However, from a RTI application all that mischief had
been detected and the defacto complainant lodged its grievances not only
with the dealer, but also the petitioner herein who was the manufacturer of
the car. The petitioner, initially assured the defacto to redress the
grievances, but save and except one meeting with the defacto, no steps had
been taken. Assurance was given to refund the entire amount of money
remitted, but the same was never refunded. Being aggrieved with the
aforesaid illegal activities of the Petitioner as well as the dealer, the defacto
9
filed a criminal complaint against the petitioner as well as against the
dealers and its officers, in the Court of the learned 4th Judicial Magistrate,
Purulia and Complaint Case No: 74/2019, under Section 420 read with
Section 1208 of the IPC. Inspite of notice, the Petitioner did not appear
before said Learned Court, and filed the present revisional application before
this Court. The only defence, as argued by the petitioner, was that, they were
manufacturers of the goods and had no responsibility in sale of a car. It was
the responsibility of the dealer, who ultimate sold the car. Mischief, if any
done by the dealer and as such no case could be made against the
manufacturers of the car and the cognizance of the case, against them was
not permissible and the complaint against them should be quashed. The
evidence of the defacto was clear that after having knowledge of the fraud
committed against them, the defacto had filed a complaint with the
petitioner. In the recorded evidence all emails sent to the petitioner/accused
no.2 had been lodged before the learned Court below and the trial court
should be given chance to assesses the evidences adduced against the
petitioner/accused no.2, not only to extent of their responsibility but also
their role in present facts and circumstances of the case. After having the
complaint from the defacto complaint, at no point of time, the
petitioner/accused no.2 took this point that, being the manufacturer, they
had no responsibility, rather, they assured to take step in the matter, to
redress the grievance of the defacto. So, it was very early stage of the case to
quash the same against the petitioner/accused no.2. It was well settled
principle of law, that, no complaint should be quashed at preliminary stage
10
of hearing. In the petitioner, it was completely suppressed that in their
official website, the dealer was shown as their “Partner”. The petitioner
further suppressed their agreement with the dealer, in other countries
contained a clause of sales reporting which make it mandatory for a dealer
to report a sale of motor vehicle to the manufacturers by the end of the day.
It was absurd to suggest that the manufacturer of vehicle had no
responsibility towards the purchaser of the vehicle. In the present case, the
manufacturer should held responsible for each and every car, which were
going to be sold to the customer and that’s why they were keeping informed
of each car sold worldwide. In the present, admittedly the car was first sold
to Shanti Surana and same was ought to be recorded with the petitioner.
But, when the complaint was made to them, the petitioner send their
representative in the office of the defacto complainant along with the dealer’s
representatives. Clear assurances were given that said car will be replaced.
But, thereafter nothing done to replace the old car sold to the petitioner. In
the similar circumstances, the Hon’ble Apex Court held, inter alia, that
supply of second hand car by declaring and directed the Company to pay
compensation of Rs.50.00 lacs only. Reliance was placed on the State of
Andhra Pradesh vs BMW India Private Limited (2024) SCC Online SC 1740.
The judgements referred to by the petitioner in its written arguments were
distinguishable on facts and law. None of the cases referred to deal with the
issue of a car manufacturer for being responsible for commission of an
offence as alleged. The court issuing process under Section 202 of the Code
should not at that stage look into the adequacy of sufficiency of
11
material/evidence. The level of satisfaction at the stage of Section 202 of the
Code was limited to that of a prima facie case to proceed for trial. 1992 2
SCC 213 (Mohinder Singh vs. Gulwant Singh and Ors.)
4. I heard the learned counsels for the parties and perused the revision
petition, the affidavits and the written notes of submissions.
5. In the course of the proceedings, a few attempts were made by the
parties to settle their disputes. Sufficient time was granted. But, no
settlement could be arrived at.
6. First, it is trite law that like a partial acquittal or a partial discharge, a
partial quashing of proceeding may also take place in an appropriate case. In
fact, this proposition has also not been seriously disputed by the
complainant.
7. The crux of the criminal complaint is that while the accused dealer
sold a second hand Mercedes car to the petitioner passing it off as a first
hand one, the present petitioner being the manufacturer of the car, aided
and abetted the same and was in conspiracy with the accused dealer in this.
But, the complainant has relied on several documents, like invoices, car
registration documents to show that the prime accused, being the car dealer,
indeed tried to make out that it was selling a brand new car to the petitioner.
However, till the delivery of the car, apparently there was no direct
communication made between the complainant and the car
manufacturer/petitioner.
12
8. Learned counsel for the complainant/opposite party had taken pains
to show that the present petitioner was aware of such fraud, at least of the
transaction in question. It was even submitted that once a new car is sold,
automatically an intimation is given to the car manufacturer/petitioner as
per their own mechanism. However, there is no material on record to
substantiate the same, especially in the event it was a second sale. The
complainant/opposite party also provided an explanation about the same
claiming that there was no pop-up mechanism and the petitioner would
know about any discrepancy only if pointed out.
9. Even if such intimation is scheduled to be given as per the
mechanism, the petitioner/manufacturer could hardly do anything if the
dealer perpetrated the fraud by not placing on record such subsequent sale
of a second hand car, allegedly trying to pass it off as a first hand car.
10. When asked about the apparent reduced price for the sale of such
Mercedes Benz car, it was submitted on behalf of the complainant that high
value cars often have to be sold with huge discounts.
11. The complainant has also tried to make out a case from subsequent
communications between the petitioner and the complainant that the
petitioner was either aware of the deal or was owning up the responsibility.
12. First, it is quite dubitable about whether such subsequent documents
would amount to admissible evidence in showing that there was an initial
deception for committing an offence of cheating, that too in conspiracy with
one another.
13
13. Secondly, even the communication/e-mails relied upon do not indicate
that the petitioner either owned up any responsibility or admitted of any
prior knowledge about such fraud. The only thing that was done was giving
an assurance that the matter would be looked into in due course.
14. In order to rope in the present petitioner/manufacturer of cars as an
accused in such a case of alleged fraudulent sale of car by a dealer, there
has to be something more which would, at the least, show that the
manufacturer had such knowledge of such fraudulent act, even if there is no
proof available for its active participation.
15. However, no such material is even prima facie available about the
petitioner’s prior knowledge about the alleged fraud.
16. Afterall, the petitioner cannot be made vicariously liable for anything
that the dealer or any other agent might do in excess and beyond the
arrangement entered into with the petitioner.
17. Therefore, from a plain reading of the petition of complaint, the initial
depositions and the materials relied upon on behalf of the
complainant/opposite party, this Court finds that no prima facie case is
made out against the present petitioner.
18. In view of above discussions and as no prima facie case is made out
against the present petitioner, the impugned proceeding is quashed so far as
the present petitioner is concerned.
14
19. However, during trial if any evidence appears against the present
petitioner, it shall be open to the trial Court to consider addition of the
present petitioner as an accused in the proceeding.
20. With these observations, the revision application and the connected
applications are disposed of.
21. Urgent certified copy of this order be supplied to the learned counsels
for the parties upon compliance of usual formalities.
(Jay Sengupta, J.)