Md. Abdul Gani Khan vs State Of Manipur And Others

MV Muralidaran, J

[1] Heard Mr.FA Khalid, learned counsel for the petitioner and Mr. H.Samarjit, learned PP.

[2] This petition has been filed by the petitioner under Section 482 of Cr.P.C. seeking to quash the FIR No.174(6) 2017 under Sections 406, 409, 420 IPC on the file of Imphal Police Station.

[3] The case of the petitioner is that he is a contractor/supplier having good reputation in doing various contract supply works in Manipur and on seeing his best performance of various supply works, the Home Department of State of Manipur awarded a work for supply of uniform and web items to him as recommended by the Higher Tender Committee in its meeting held on 24.03.2014. Thereafter, a contract agreement dated 05.04.2014 was executed. As per the recommendation and also approval of the Government of Manipur, the Inspector General of Police(Admn.), Manipur issued a supply order in the name of the petitioner's firm vide supply order dated 24.04.2014 for supply of uniform and web items, including leather belt (black) for 20,000 Nos. at the rate of Rs. 117/- per piece.

[4] Pursuant to the supply order, the petitioner supplied the said items as per the specification given in good quality and condition and the same were checked by the Line Committee and found to be in order and it was also accepted by the Director General of Police vide letters dated 25.06.2014 and 23.08.2014 and accordingly, the bills were also settled by the respondent Government. While so, after the lapse of three years of supply, the respondent authorities without the knowledge of the petitioner checked their godown and alleged that 20 piece of the said belts were found to be of poor quality and there needs to be an enquiry on this and accordingly, the Home Department issued a press release on 07.06.2017 for conducting enquiry and submitting a report within one month. Before conducting any enquiry and fixing responsibility, an FIR being FIR No.174(6) 2016 under Sections 406,409, 420 IPC was registered against the petitioner and he was arrested, but later released on bail.

[5] According to the petitioner, the action of the respondents is highly excessive and even without giving an opportunity of hearing, his name has been blacklisted, however, the same was set aside by this Court in W.P.(C) No. 444 of 2017. Stating that the dispute in issue is purely civil in nature, as the same arises from the contract agreement, the petitioner prayed for quashing of FIR No. 174(6) 2016 IPC registered under Sections 406,409, 420 IPC.

[6] The third respondent filed affidavit in opposition stating that on 09.06.2017 at 4.40 P.M, the complainant Dr. S. Ibocha Singh, IGP (Admn.) Manipur had lodged a written report addressed to the Officer-in-charge, Imphal Police station stating that Md. Abdul Gani Khan, the petitioner herein, has supplied 20,000 numbers of belt, which are not leather belts on 23.06.2014 and 20.08.2014, numbering 1024 and 18976 respectively in response to the supply order from the Police Headquarters for supply of leather belts of branded quality for Rs. 23,40,000/-. In this way the petitioner had committed the offence of cheating and breach of criminal trust by supplying belts which are not leather belts with criminal intention to gain undue financial benefit with dishonest intention. In that IGP(Admn.), Manipur had submitted a written report to the Imphal Police. On the basis of the written report, a case in FIR No. 174(6) 2016 IPC under Sections 406,409, 420 IPC was registered against the petitioner for investigation and during the course of investigation, the petitioner was arrested and during interrogation, the petitioner had given confession. The petitioner admitted that he had committed the crime with his co-accused Rajendra Balwan, Proprietor, SS Enterprise, Kanpur. According to the third respondent, the investigation is in good progress and pending for further investigation and hence, prayed for dismissal of the petition.

[7] Heard the learned counsel for the petitioner and the learned Government Advocate for the respondents.

[8] The learned counsel for the petitioner vehemently argued that the present case is purely civil in nature and the civil nature cannot be given a colour of criminal offence and that the dispute arose from an agreement of supply. He would submit that before submission of the report by the so called Committee fixing the responsibility, and FIR was registered. The learned counsel argued that when the items supplied by the petitioner were accepted by the respondents, after a lapse of three years, the respondents cannot contend that the supplies made by the petitioner are of inferior quality and according to the learned counsel, the allegations made against the petitioner are false and fabricated and also to defame the petitioner in the society.

[9] Per contra, the learned Government Advocate submitted that the petitioner had committed the offence of cheating and breach of criminal trust by supplying belts, which are not leather belts with criminal intention to gain undue financial benefit with dishonest intention. Therefore, the IGP(Admn.), Manipur lodged a complaint in FIR No. 174(6) 2016 IPC registered under Sections 406,409, 420 IPC against the petitioner and the investigation is rightly going on and, therefore, there is no necessity to quash the same.

[10] I have considered the submissions made by the learned counsel appearing on either side and also perused the materials available on record.

[11] In the instant criminal petition, the petitioner has prayed for quashing of FIR No. 174(6) 2016 IPC under Sections 406,409, 420 IPC registered against him by contending that the petitioner is innocent person having good reputation in society in supplying works to different Departments of the respondent Government for more than 30 years without any adverse remarks. Hence, the FIR lodged against the petitioner is solely intended to cause serious damage to him in all fields of contract and supply works.

[12] There is no dispute with regard to calling for tender, supply and acceptance and also payment to the petitioner. There is also no dispute that the security deposit made by the petitioner was also refunded to him on 22.08.2014 by the Director General of Police, Manipur. However, after three years, it was suddenly stated that the web equipments including leather belts supplied by the petitioner are of inferior quality. As such, Enquiry Committee was constituted and the Enquiry Committee is yet to submit its report. While things stood thus, the Inspector General of Police (Admn.), Manipur, who was also a Member of the Enquiry Committee, directed to register a criminal case against the petitioner. In obedience of the direction of the superior officer, the Imphal Police registered the case against the petitioner and he was arrested.

[13] It appears that by an order dated 09.06.2017, the respondent authorities blacklisted the petitioner. Challenging the said order, the petitioner filed W.P.C No. 444 of 2017 before this Court. By order dated 31.10.2017, this Court set aside the order dated 09.06.2017 passed by the Under Secretary (Home), Government of Manipur. However, liberty was given to the State to proceed with the matter in accordance with law.

[14] It is seen that the order of the State Government blacklisting the petitioner is dated 09.06.2017 and on the same date, the Inspector General of Police (Admn.), Manipur has lodged the complaint before the Imphal Police Station, which had registered the case in FIR No. 174 (6) 2016 IPC under Sections 406, 409, 420 IPC against the petitioner. When this Court earlier directed the State to proceed with the matter in accordance with law, the complaint which was given on the same date against the petitioner is not maintainable. It is an admitted fact that as against the order passed in W.P.C No. 444 of 2017, the State has not preferred any appeal. Therefore, the order passed in W.P.C No. 444 of 2017 attained finality. In the other dated 31.10.2017, this Court observed that it is open to the State respondents to proceed in accordance with law. In accordance with law is not meant for initiation of criminal proceedings.

[15] Nothing has been produced by the respondent to show how criminal proceedings would lie against the petitioner when tender for supply of materials, supply and payment to the petitioner were completed. Though the respondents contended that the petitioner has committed the offence of cheating and breach of criminal trust by supplying belts which are not leather belts with criminal intention to gain undue financial benefit with dishonest intention, nothing has been produced to show that the alleged inferior quality would constitute criminal intention to gain undue financial benefit with dishonest intention.

[16] Moreover, when the Line Committee, after verification had submitted a report to the third respondent stating that the items supplied by the petitioner are as per the specification at the time of tender, the question of supplying goods of inferior quality does not arise. It is seen that the petitioner had supplied all the items of leather belts to the office of the respondents in the year 2014, up to the month of August 2014, to the satisfaction of the respondents and no defect and/or inferior quality was found. After effecting supply of leather belts and after the officials of the respondents used the same, in my considered opinion, after lapse of three years from the date of receipt of the goods, no criminal action would lie against the petitioner. Under the guise of the blacklisting order, the third respondent lodged the FIR against the petitioner. When the blacklisting order itself was set aside by the Court of law, the present FIR cannot be maintained.

[17] On a perusal of the contract agreement entered between the petitioner and the third respondent dated 05.04.2014, it is seen that Clause 5 provides as under:

"5. That the first party agrees that in the event of rejection by the second party on the ground of any manufacturing defects or otherwise, the first party will replace the items by new one as per specification at its own costs,"

[18] Admittedly, the respondents have not invoked the provisions of aforesaid Clause 5 of the contract agreement. It may be noted that the issue has arisen out of a commercial transaction based on the contract agreement and any action to be taken against the petitioner, should be only in accordance with the contract entered into between the parties. Further, as per Clause 5 of the agreement, the only action that could have been taken by the State Government was to direct the petitioner to replace the materials which were found to be of manufacturing defects or otherwise. In the case on hand, nothing has been produced by the State Government to show that any such replacement request was made to the petitioner.

[19] It is to be noted that the Committee constituted to conduct an enquiry into the quality and quantity of various web equipments has not concluded its enquiry and no report was submitted so far. While so, the Inspector General of Police (Admn.), who was also a member of the Enquiry Committee, hurriedly directed imphal Police to register the criminal case against the petitioner. Thus, the act of the third respondent is arbitrary. Admittedly, the State Government has not given any notice to the petitioner with regard to the alleged supply of inferior quality of leather belts. Further, no information and/or notice was given to the petitioner by the third respondent before levelling allegation against him. It is clear that the allegation levelled against the petitioner is to defame him in the society and also to cause harassment i.e, mentally and financially.

[20] It is apposite to mention that on the face of record, the present issue involved in the instant case is purely civil in nature and the civil nature cannot be given a colour of criminal offence. As stated supra, the dispute arose out of the contract agreement of supply. Thus, it is clear that the dispute which is essentially of a civil nature is given a cloak of criminal offence.

[21] In Paramjeet Batra V.State of Uttarkhan and others, reported in (2013)11 SCC 673, the Hon'ble Supreme Court held.

"12. While exercising its jurisdiction under Section 482 of the Code the High Court has to be cautious. This power is to be used sparingly and only for the purpose of preventing abuse of the process of any court or otherwise to secure ends of justice. Whether a complaint discloses a criminal offence or not depends upon the nature of facts alleged therein. Whether essential ingredients of criminal offence are present or not has to be judged by the High Court. A complaint disclosing civil transactions may also have a criminal texture. But the High Court must see whether a dispute which is essentially of a civil nature is given a cloak of criminal offence. In such a situation, if a civil remedy is available and is, in fact, adopted as has happened in this case, the High Court should not hesitate to quash criminal proceedings to prevent abuse of process of court."

[22] Insofar as the power and jurisdiction of the High Court under Section 482 of Cr.P.C. is concerned, it is well settled that while exercising the power under Section 482 of the Code, the High Court does not function as the Court of appeal or revision. The inherent power under Section 482 of Cr.P.C., can be exercised to give effect to an order under the Code to prevent abuse of process of the Court and to otherwise secure the ends of justice. It is well settled that the inherent powers under this provision should not be exercised to stifle a legitimate prosecution.

[23] It is settled position that the High Court normally should refrain from giving a prima facie decision in a case where all the facts are incomplete and hazy, more so, when the evidence has not been collected and produce before the Court and the issues involved, whether factual or legal, are of such magnitude that they cannot be seen in their true perspective without sufficient material. The whole power under Section 482 Cr.P.C. entitles the High Court to quash a proceeding when it comes to the conclusion that allowing the proceeding would cause serious prejudice to the party against whom allegations are made and the ends of justice required that the proceeding ought to be quashed.

[23] As stated supra, here the dispute is essentially about the contract agreement. The alleged inferior quality stated by the respondents can also be dealt with by way of civil remedy, which take care of the said issue, however, subject to the limitation. In such a situation, in my opinion, continuation of the proceedings in FIR No.174 (6) 2017 on the file of the Imphal Police Station would be abuse of the process of law and if the proceedings are continued, it will cause much hardship to the petitioner. Therefore, the same is liable to be quashed.

[24] In the result,

a) This Criminal Petition No. 2 of 2018 is allowed.

b) The F.I.R. No. 174(6) 2017 on the file of the Imphal Police Station is quashed.