Delhi High Court Dismisses Ex-CFO's Plea Against PwC Ltd Seeking Action For Criminal Defamation

The Delhi High Court has observed that criminal liability cannot be fastened on the basis of a person holding a position in any company, with nothing more to specify the role played by such a person in the commission of a crime.

Justice Asha Menon made the observation while dismissing a plea filed by a former Chief Finance Officer (CFO) of M/s Pricewaterhousecoopers Private Limited, who had sued the company and its Chairperson for defamation, after he was labelled as a "disgruntled ex-employee" by a company Spokesperson in articles published in the Economic Times and Outlook Magazine in 2017-18.

It was the petitioner's case that he had found certain irregularities in the method of working of the company and on highlighting the same, he was sidelined in the organization and finally was forced to resign on 31st December, 2011. However, the company issued a Letter of Termination on 27th February, 2012 in which, as per the petitioner, defamatory allegations were made.

A complaint was filed by the petitioner before the Metropolitan Magistrate on 22nd October, 2018 alleging that the company and its employees had defamed and hence offence under sec. 500 IPC is attracted.

The MM vide order dated 30th August, 2019 summoned the accused in the complaint to face trial for the offence of defamation holding that the allegations made prima facie constituted the said offence.

The company had then filed a criminal revision before the Additional Sessions Judge wherein it was concluded that there was no material on the basis of which the Court could have summoned any of the accused persons. Accordingly, the summoning order was set aside in its entirety. The petitioner had challenged the said order before the High Court.

Rejecting the petitioner's argument that the Sessions Court had exceeded its jurisdiction by quashing the summoning order, the High Court said that sec. 397 of Cr.P.C. provides for powers of a Sessions Judge to call for and examine the record of any inferior criminal court situated within its jurisdiction for the purposes of satisfying itself as to the correctness, legality or propriety of any finding or evidence or order, recorded, as also to the regularity of any proceeding of such inferior court.

"To therefore say that the Sessions Judge could have looked into the correctness of the summoning order qua the respondents No.3 and 4, only if they had approached it, would be an incorrect reading of the law. The Sessions Court would be well within its powers to satisfy itself about the legality and irregularity or the proceedings or orders made by the learned Trial Court to determine whether it was grossly erroneous or the finding was recorded based on no evidence or material evidence was ignored or judicial discretion was exercised arbitrarily or perversely," the Court said.

The Court also added that it cannot be held that the Sessions Court had misdirected itself by looking at the nature of the publications to determine whether the Trial Court could have passed the order summoning the respondents.

The petitioner had argued that he had examined two of his friends to testify how the articles in question had lowered his reputation and also to prove the same.

Observing that the testimonies did not add to the petitioner's case, the Court observed:

"The reference in the article in the Economic Times to a "Spokesperson" cannot be inferred to refer to either respondent No.3 or respondent No.4, only because one is the Chairman of the respondent No.2 and the other is the Chief Communications Officer. Criminal liability cannot be fastened on the basis of a person holding a position with nothing more to specify the role played by such a person in the commission of a crime."

"Since the entire edifice of the case of the petitioner rests on the publication of these two articles, it was necessary to show how the respondents were connected to the publication. The petitioner has not done so."

The Court also said that the testimonies of petitioner's friends only recorded their opinions in the matter as appeared to them and that such statements fell short of the quality of evidence required under sec. 499 IPC to establish the commission of the offence under sec. 500 IPC.

"... the conclusion of the learned Sessions Court that the use of the word "disgruntled employee" was not slanderous is a justified conclusion. The reading of the articles, as rightly observed by the learned Sessions Court, shows that the grievance of the petitioner is a response to a query by the Economic Times to certain litigation initiated by the petitioner. It is for him to explain how litigation initiated by him became subject matter of the publication. It is only fair reporting to seek a response from the person against whom charges have been levelled," the Court held.

Upholding the impugned order, the Court dismissed the plea.

Case Title: SARVESH MATHUR v. STATE OF NCT DELHI & ORS.

Citation: 2022 LiveLaw (Del) 835

Click Here To Read Order