The Supreme Court held that the Magistrate, while considering a defamation complaint, has the authority to assess whether there is "sufficient ground for proceeding" based on the allegations and evidence provided. The Court held Magistrate can dismiss a defamation complaint by applying the exceptions under section 499 of the Indian Penal Code, 1860 even before even summoning the accused. The appellant, a German company, challenged a summoning order issued by a Trial Court in India. The order was based on a complaint filed by the respondent, alleging defamation and its abetment against the appellant and others. The appellant's representative had issued letters of complaint making serious allegations against the respondent.

A two judge Bench of Justice Bela M. Trivedi and Justice Dipankar Datta held that, “it is not the law that the Magistrate is in any manner precluded from considering if at all any of the Exceptions is attracted in a given case; the Magistrate is under no fetter from 44 so considering, more so because being someone who is legally trained, it is expected that while issuing process he would have a clear idea of what constitutes defamation. If, in the unlikely event, the contents of the complaint and the supporting statements on oath as well as reports of investigation/inquiry reveal a complete defence under any of the Exceptions to section 499, IPC, the Magistrate, upon due application of judicial mind, would be justified to dismiss the complaint on such ground and it would not amount to an act in excess of jurisdiction if such dismissal has the support of reasons.”

Advocate Viswanathan appeared for the Appellant and Advocate Manoj D. Taneja appeared for the Respondents.

The appellant argued that the High Court failed to consider crucial aspects, such as the absence of specific imputations made by the appellant, the legal protection of documents filed in civil cases, and the failure of the Trial Court to apply exceptions to the defamation law.

The respondent countered that their challenge to the summoning order had already been rejected, and the appellant was aware of the letters of complaint issued by him. They argued that the appellant could not introduce new evidence (like the Power of Attorney) at this stage, and it was their responsibility to respond to the summons in the Trial Court.

The issues before the Supreme Court were:

  1. Whether, while considering a private complaint alleging defamation, the Magistrate before summoning the accused ought to confine himself to the allegations forming part of the petition only or he may, applying his judicial mind to the exceptions to section 499, IPC, dismiss the complaint holding that the facts alleged do not make out a case of defamation?
  2. Whether and, if at all, to what extent, is it open to the High Courts to exercise inherent power saved by section 482, Cr. PC to quash proceedings for defamation by setting aside the summoning order upon extending the benefit of any of the Exceptions to section 499, IPC?

Additionally, the Court intended to address specific questions related to the facts and circumstances of the appeal:

a) Whether the appellant has presented sufficient grounds to challenge the judicial orders of the Magistrate and the learned Judge.

b) Whether a company can be prosecuted for defamation when the alleged defamatory statements were made not directly by the company but by its authorized agent.

c) Depending on the above considerations, whether the appellant should be granted the benefit of the Fourth Exception to section 499, IPC, as claimed by them.

The Court said the Magistrate, when considering a defamation complaint, must assess whether there is "sufficient ground for proceeding" based on the complaint's allegations and supporting evidence. This evaluation is not for establishing guilt but to decide if there is enough evidence to proceed with the case.

The Court added although the law does not mandate the Magistrate to consider the exceptions to defamation under section 499, IPC, there is no legal bar to doing so. If the materials reveal a complete defense under any of the exceptions, the Magistrate can dismiss the complaint. The Court added, “nothing prevents the Magistrate upon application of judicial mind to accord the benefit of such Exception to prevent a frivolous complaint from triggering an unnecessary trial. Since initiation of prosecution is a serious matter, we are minded to say that it would be the duty of the Magistrate to prevent false and frivolous complaints eating up precious judicial time. If the complaint warrants dismissal, the Magistrate is statutorily mandated to record his brief reasons. On the contrary, if from such materials a prima facie satisfaction is reached upon application of judicial mind of an “offence” having been committed and there being sufficient ground for proceeding, the Magistrate is under no other fetter from issuing process.”

The Court said that the High Courts can interfere only if, after examining the complaint, statements on oath, and supporting evidence, no offense is made out, and continuing the proceedings would amount to an abuse of the legal process. The Court said, “in a case where the offence of defamation is claimed by the accused to have not been committed based on any of the Exceptions and a prayer for quashing is made, law seems to be well settled that the High Courts can go no further and enlarge the scope of inquiry if the accused seeks to rely on materials which were not there before the Magistrate. This is based on the simple proposition that what the Magistrate could not do, the High Courts may not do.”

The Court further added, “the High Courts on recording due satisfaction are empowered to interfere if on a reading of the complaint, the substance of statements on oath of the complainant and the witness, if any, and documentary evidence as produced, no offence is made out and that proceedings, if allowed to continue, would amount to an abuse of the legal process. This too, would be impermissible, if the justice of a given case does not overwhelmingly so demand.”

The Court pointed out that liability of a company for defamatory statements made by an authorized agent depends on the facts of the case. If it's proven that the agent acted with the consent or knowledge of the company, defamation proceedings can continue.

The Court said that whether the Fourth Exception to section 499, IPC, or any other defense is applicable should be decided during the trial, and the burden of proof lies with the accused.

The Court said, “issue of process under section 204 read with section 200, Cr. PC does not ipso facto stand vitiated for non-consideration of the Exceptions to section 499, IPC unless, of course, before the High Court it is convincingly demonstrated that even on the basis of the complaint and the materials that the Magistrate had before him and without there being anything more, the facts alleged do not prima facie make out the offence of defamation and that consequently, the proceedings need to be closed.”

The Apex Court found that the Trial Court's issuance of summons was justified based on the materials before it. The High Court's decision not to interfere with the Trial Court's order was upheld.

The appeal was dismissed, and the interim order was vacated.

Cause Title: M/S Iveko Magirus Brandshutztechnik Gmbh v. Nirmal Kishore Bhartiya & Anr., [2023INSC880]

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Justice Bela M TrivediJustice Dipankar Datta

Suchita Shukla