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Judgment
Petitoner/accused Anil Dudha Bhai Kaneria, Smt. Sheetal Kaneria and Sanjay Makawana preferred this Misc. Petition under Section 482 Cr.P.C. for quashing impugned FIR No. 863/2015 registered at Police Station Beawar City, Beawar, District Ajmer for offences punishable under Sections 420, 406, 504, 120B IPC.
Brief facts of the case are that respondent no. 2/complainant submitted a criminal complaint on 02.09.2015 before Learned Additional Chief Judicial Magistrate, Beawar being complaint no. 449/2015 against the present petitioners stating therein :-
"VERNACULAR MATTER OMITTED"
The said complaint was sent under Section 156(3) Cr.P.C. for investigation to SHO, Police Station Beawar City, Beawar, District Ajmer where impugned FIR No. 863/2015 under Sections 420, 406, 504, 120B IPC was registered and investigation commenced. Matter is still under investigation.
Learned Counsel for petitioners Mr. Rajesh Mootha submits that from the bare perusal of FIR, it reveals that, the dispute between parties is exclusively of civil nature regarding business transactions. He submits that trading of mineral powder is going on between parties since last 5-6 years and part payment is being given by the petitioners/accused to complainant, therefore the ingredients of cheating enshrined in Section 415 IPC are missing in this matter, therefore there is no ground for offence under Section 420 IPC. So far as Section 406 IPC is concerned, there should be entrustment but not a single allegation is their in where respondent no. 2/complainant alleged that accused was entrusted with property or any goods or amount to petitioner which has been alienated. Further Section 504 IPC is concerned, he submits that petitioners are residing at Badadla Bagra, District Bharuch (Gujarat) when did respondent no. 2/complainant visited their he did not mention any date or time. Regarding the offence under Section 504 IPC, not only this the words for alleged insulting has not also been mentioned in the FIR, therefore there is no ground for registering FIR or continuing investigation for offence under Section 504 IPC also. Since the ingredients of main offences are missing, therefore offence under Section 120B IPC is also not a ground for continuing investigation. He submits that since no offence is disclosed from the FIR, therefore impugned FIR may be quashed and set aside.
Learned Counsel relied on Binod Kumar and Others Vs State of Bihar and Another reported in (2014) 10 SCC 663, International Advanced Research Centre for Powder Metallurgy and new materials (ARCI) and others Vs Nimra Cerglass Technics Private Limited and Another reported in (2016) 1 SCC 348.
Per Contra Mr. Anshudhar Singh Learned Counsel appearing on behalf of respondent no. 2/complainant submitted that the intention of petitioners was to deceit complainant from the very inception, therefore offence under Section 420 IPC and since there are serious allegations regarding insulting, therefore ingredients of Section 504 and 120B IPC are also there in FIR. He further submits that powers vested in this Court under Section 482 Cr.P.C. should be exercised sparingly. He submits that from the perusal of FIR, it cannot be said that no cognizable offence is disclosed, therefore the Misc. Petition may be dismissed.
Learned Counsel relied on Taramani Parakh Vs State of Madhya Pradesh and Others reported in (2015) 11 SCC 260 and Ashfaq Ahmed Quereshi & Anr. Vs Namrata Chopra & Ors. reported in 2014 I AD (S.C.) 21, Criminal Appeal No. 2100/2013 decided by Hon''ble Supreme Court on 17.12.2013.
Learned PP Mr. NS Dhakad supported the submissions made by Learned Counsel for complainant and submits that this Misc. Petition may be dismissed.
I have considered the submissions made at bar. In the matter of Binod Kumar and Others Vs State of Bihar and Another, Hon''ble Supreme Court observed that :-
" 17. Section 420 IPC deals with cheating. The essential ingredients of Section 420 IPC are:-
(i) cheating;
(ii) dishonest inducement to deliver property or to make, alter or destroy any valuable security or anything which is sealed or signed or is capable of being converted into a valuable security, and
(iii) mens rea of the accused at the time of making the inducement.
In the present case, looking at the allegations in the complaint on the face of it, we find that no allegations are made attracting the ingredients of Section 405 IPC. Likewise, there are no allegations as to cheating or the dishonest intention of the appellants in retaining the money in order to have wrongful gain to themselves or causing wrongful loss to the complainant. Excepting the bald allegations that the appellants did not make payment to the second respondent and that the appellants utilized the amounts either by themselves or for some other work, there is no iota of allegation as to the dishonest intention in misappropriating the property. To make out a case of criminal breach of trust, it is not sufficient to show that money has been retained by the appellants. It must also be shown that the appellants dishonestly disposed of the same in some way or dishonestly retained the same. The mere fact that the appellants did not pay the money to the complainant does not amount to criminal breach of trust.
Even if all the allegations in the complaint taken at the face value are true, in our view, the basic essential ingredients of dishonest misappropriation and cheating are missing. Criminal proceedings are not a short cut for other remedies. Since no case of criminal breach of trust or dishonest intention of inducement is made out and the essential ingredients of Sections 405/420 IPC are missing, the prosecution of the appellants under Sections 406/120B IPC, is liable to be quashed."
In the matter of International Advanced Research Centre for Powder Metallurgy and new materials (ARCI) and others Vs Nimra Cerglass Technics Private Limited and Another, Hon''ble Supreme Court observed that :-
" 14. In the light of the well-settled principles, it is to be seen whether the allegations in the complaint filed against ARCI and its officers for the alleged failure to develop extruded ceramic honeycomb as per specifications disclose offences punishable under Sections 419 and 420 IPC. It is to be seen that whether the averments in the complaint make out a case to constitute an offence of cheating.
The essential ingredients to attract Section 420 IPC are: (i) cheating; (ii) dishonest inducement to deliver property or to make, alter or destroy any valuable security or anything which is sealed or signed or is capable of being converted into a valuable security and (iii) mens rea of the accused at the time of making the inducement. The making of a false representation is one of the essential ingredients to constitute the offence of cheating under Section 420 IPC. In order to bring a case for the offence of cheating, it is not merely sufficient to prove that a false representation had been made, but, it is further necessary to prove that the representation was false to the knowledge of the accused and was made in order to deceive the complainant.
The distinction between mere breach of contract and the cheating would depend upon the intention of the accused at the time of alleged inducement. If it is
established that the intention of the accused was dishonest at the very time when he made a promise and entered into a transaction with the complainant to part with his property or money, then the liability is criminal and the accused is guilty of the offence of cheating. On the other hand, if all that is established that a representation made by the accused has subsequently not been kept, criminal liability cannot be foisted on the accused and the only right which the complainant acquires is the remedy for breach of contract in a civil court. Mere breach of contract cannot give rise to criminal prosecution for cheating unless fraudulent or dishonest intention is shown at the beginning of the transaction. In S.W. Palanitkar & Ors. vs. State of Bihar & Anr. (2002) 1 SCC 241, this Court held as under:
"21 ......In order to constitute an offence of cheating, the intention to
deceive should be in existence at the time when the inducement was made. It is necessary to show that a person had fraudulent or dishonest intention at the time of making the promise, to say that he committed an act of cheating. A mere failure to keep up promise subsequently cannot be presumed as an act leading to cheating."
The above view in Palanitkar''s case was referred to and followed in Rashmi Jain vs. State of Uttar Pradesh & Anr. (2014) 13 SCC 553.
In Indian Oil Corporation vs. NEPC India Ltd. Ors., (2006) 6 SCC 736, this court observed that civil liability cannot be converted into criminal liability and held as under:-
(SCC pp. 748-49, paras 13-14)
While on this issue, it is necessary to take notice of a growing tendency in business circles to convert purely civil disputes into criminal cases. This is obviously on account of a prevalent impression that civil law remedies are time consuming and do not adequately protect the interests of lenders/creditors. Such a tendency is seen in several family disputes also, leading to irretrievable breakdown of marriages/families. There is also an impression that if a person could somehow be entangled in a criminal prosecution, there is a likelihood of imminent settlement. Any effort to settle civil disputes and claims, which do not involve any criminal offence, by applying pressure through criminal prosecution should be deprecated and discouraged. In G. Sagar Suri v. State of U.P. (2000) 2 SCC 636 this Court observed: (SCC p.643, para 8)
" It is to be seen if a matter, which is essentially of a civil nature, has been given a cloak of criminal offence. Criminal proceedings are not a short cut of
other remedies available in law. Before issuing process a criminal court has to exercise a great deal of caution. For the accused it is a serious matter. This Court has laid certain principles on the basis of which the High Court is to exercise its jurisdiction under Section 482 of the Code. Jurisdiction under this section has to be exercised to prevent abuse of the process of any court or otherwise to secure the ends of justice."
While no one with a legitimate cause or grievance should be prevented from seeking remedies available in criminal law, a complainant who initiates or persists with a prosecution, being fully aware that the criminal proceedings are unwarranted and his remedy lies only in civil law, should himself be made accountable, at the end of such misconceived criminal proceedings, in accordance with law. One positive step that can be taken by the courts, to curb unnecessary prosecutions
and harassment of innocent parties, is to exercise their power under Section 250 CrPC more frequently, where they discern malice or frivolousness or ulterior motives on the part of the complainant. Be that as it may."
In the case in hand, from the perusal of FIR itself, it reveals that respondent no. 2/complainant is dealing with mineral powder at Beawar in the name of M/s Bansi Minerals and petitioner/accused Anil Dudha Bhai Kaneria is doing business in the name of M/s. Kaneria Grenito Ltd. and there is business dealing between them since last 5-6 years and it is also decided that the material will be supplied on the condition that payment shall be made within 60 days failing which interest will be leviable at the rate of 13% per annum and it also reveals that some cheques were given by petitioners/accused in connection to make payment some of which have been returned by their banker which shows that the dispute between petitioners and respondent no. 2 is regarding due payment in tune of Rs. 62,53,152/-. There is not a single whisper in the FIR that the goods were taken by petitioners with intention to deceive him, when regular business is going on since years and payment is due then prima facie it cannot be said that there is cheating. In proceedings instituted on criminal complaint quashment when warranted, reiterated exercise of inherent powers to quash the proceedings is called for only in case where complaint does not disclose any offence or is frivolous. It is true that powers under Section 482 Cr.P.C. should be invoked sparingly with circumspection, it should be exercised to see that process of law is not abused or mis-used, the settled principle of law is that at the stage of quashing the complaint/FIR, High Court is not embark upon an enquiry as to probability, reliability, or genuineness of allegations made therein.
In Nagawwa Vs Veeranna Shivalingappa Konjalgi reported in (1976) 3 SCC 736, Hon''ble Supreme Court framed following four grounds for quashing the criminal proceedings :-
(1) where the allegations made in the complaint or the statements of the witnesses recorded in support of the same taken at their face value make out absolutely no case against the accused or
the complainant does not disclose the essential ingredients of an offence which is alleged against the accused;
(2) where the allegations made in the complaint are patently absurd and inherently improbable so that no prudent person can ever reach a conclusion that there is a sufficient ground for proceeding against the accused;
(3)where the discretion exercised by the Magistrate in issuing process is capricious and arbitrary having been based either on no evidence or on materials which are wholly irrelevant or inadmissible; and
(4) where the complaint suffers from fundamental legal defects such as, want of sanction, or absence of a complaint by legally competent authority and the like."
Here in the case in hand, from the perusal of FIR as argued by Learned Counsel for petitioners Mr. Rajesh Mootha, the ingredients for offence punishable under Section 420 IPC which are defined in Section 415 IPC are missing. Similarly for offence under Section 406 IPC, the ingredients of criminal breach of trust enshrined in Section 405 IPC are missing. So far as Section 504 IPC is concerned neither date, time or place of such offence was given nor the words uttered by petitioners are disclosed, in absence there of, the ingredients of Section 504 IPC are also missing. Now Section 120B IPC remains, since the ingredients of principal offences are missing, therefore this offence also can''t find place and the case of present petitioners comes in the purview of ground 1 and 2 of Nagawwa Vs Veeranna Shivalingappa Konjalgi case.
In the matter of Taramani Parakh Vs State of Madhya Pradesh and Others (supra) in Para 11 Hon''ble Supreme Court observed that :-
"Courts should be reluctant and should not hasten to quash the proceedings even on the premise that one or two ingredients have not been stated or do not appear to be satisfied if there is substantial compliance with the requirements of the offence."
which is not disputed.
Similarly, in Ashfaq Ahmed Quereshi & Anr. Vs Namrata Chopra & Ors., Hon''ble Supreme Court observed that :-
"As the case raises a large number of disputed questions of fact, we are of the considered opinion that there was no occasion for the High Court to allow the petition under Section 482 Cr.P.C. and quash the criminal proceedings qua the said respondents. "
which is also not disputed.
But in the case in hand as discussed above, there is no such disputed questions, therefore the case laws cited by Learned Counsel for respondent no. 2/complainant are not applicable in the present case.
As discussed above, in the present case from the bare perusal of matter, it reveals that, the dispute between parties is exclusively civil dispute regarding recovery of money of business transactions, therefore it is fit case for quashing FIR. Accordingly, the Misc. Petition is allowed and the impugned FIR No. 863/2015 registered at Police Station Beawar City, Beawar, District Ajmer for offences punishable under Sections 420, 406, 504, 120B IPC and subsequent proceedings there to are quashed and set aside.