Ratilal Manilal Patel vs State Of Gujarat

S.H.Vora, J

By way of present application under section 482 of Code of Criminal Procedure, the applicant has made following prayers in terms of para - 9(i) :-

"(i) That the Hon'ble Court may be pleased to quash and set aside the proceedings of Criminal Case No.24108 of 2019 pending in the Court of Judicial Magistrate First Class, Vadodara."

The gist of factual submissions made at bar can be stated thus :-

2.1 Respondent no.2 complainant approached the applicant and his wife - Ms. Jyotiben to purchase certain piece of lands of village - Pipariya and village - Kamlapura, for which agreement for sale was executed and respondent no.2 paid an amount of Rs.31 lakhs at relevant time. The respondent no.2 cancelled the agreement for sale on 17.12.2008 and an amount of Rs.31 lakhs was refunded by cheque bearing No.348216 on 17.12.2008. In turn, wife of respondent no.2 executed sale deeds in respect of the lands on or about 30.04.2011. Before impugned proceedings under section 138 of the N.I.Act came to be initiated, there are other various transaction which took place with respect to the said lands and there were civil / criminal proceedings filed between the parties and other persons also.

2.2. It is specific case of the applicant accused that as such there is no legally enforceable debt or other liability for the disputed cheque for an amount of Rs.3 Crores as claimed towards cancellation of agreement for sale dated 22.05.2008, which was cancelled on 17.12.2008. The amount under said agreement was received by Ms.Jyotiben, wife of the applicant and thus, the transaction which was entered with the applicant's wife, agreement for sale was cancelled and did not refer to any other transaction. Thus, the disputed cheque was not legally enforceable debt or liability of the applicant. Despite such fact, the complainant - respondent no.2 did not raise any claim of share of profit with respect to said lands after cancellation of sale agreement in December, 2008 till March, 2019. Despite execution of various MOU and sale deeds at different stages, respondent no.2 did not raise any objection in respect of sharing of profit. It is specific case of the applicant that after he was released on bail by the High Court in Criminal Misc. Application No.21646 of 2018, the applicant was summoned on 18.03.2019 and under pressure, disputed cheque was obtained and on the next date i.e. on 19.03.2019, the applicant made a representation annexed at Anneure - F.

2.3. Broadly, on such factual aspects and allegations, present application is filed relying on following decisions :-

(1) M/s. Indus Airways Pvt. Ltd. v/s. M/s. Magnum Aviation Pvt. Ltd. reported in 2014(3) GLR 2482.

(2) Ing Vysya Bank Ltd. v/s. State of Rajasthan reported in 2015(O) AIJEL-SC 56548.

(3) Bharatbhai K.Patel v/s. C.L.Verma reported in 2002 (O) GLHEL-HC 201599

Before factual details are considered, in light of principles settled in case law cited at bar, it is important and relevant to note that in the complaint, in para 3 to 5, it is specific case of respondent no.2 - complainant that after cancellation of sale agreement and on account of technical reasons, the applicant made a request to cancel sale agreement and further agreed to give profit on sale of lands. Not only that the parties to the proceedings executed one MOU and for breach of such MOU, criminal complaint was filed and the applicant secured bail. At that time, the applicant accused made a request to settle the issue and pursuant to which the applicant agreed to hand over disputed cheque of Rs.3 Crores towards profit on sale of the lands situated at village - Pipariya and village - Kamlapura.

In this factual background of the complaint, it is relevant to refer proposition of law laid down by Hon'ble Apex Court and this Court cited at bar. In the case of Indus Airways Pvt. Ltd. (supra), the Hon'ble Apex Court has held that cheque issued towards advance payment at the time of signing contract, is not a cheque drawn for existing debt or liability and therefore, dishonor of such cheque is not offence under section 138 of the N.I.Act. In the present case, cheque is issued towards payment of profit earned out of sale of lands situated at afore-mentioned two villages and not on signing of MOU and therefore, said case law cited is not applicable to the facts of the present case.

In the case of Bharatbhai K.Patel (supra), this Court has observed that proceedings under section 138 of N.I.Act can be quashed if the accused is able to show that there is no existing debt or liability at the time of presentation of the cheque for encashment or the basis of the conduct of the complainant or admission made by the complainant. Here, in the case on hand, there is no such admission or complainant's conduct to infer that there was no existing debt or liability at the time of presentation of the cheque because the applicant accused issued the cheque towards settlement of profit from sale of lands and as asserted in the complaint, the respondent no.2 facilitated smooth sale of lands and to get rid of technical reasons under tenancy law, the respondent no.2 agreed for cancellation of sale agreement on promise by the applicant accused to give share of profit on sale of lands and same stands reflected in the MOU executed between the parties to the proceedings as per the averments made in the complaint.

In the case of Ing Vysya Bank Limited (supra), the Hon'ble Apex Court has held that no action can be sustained if there is no liability or debt in favour of respondent no.2 therein. In the case of hand, it is not so, as there is liability acknowledged by the applicant accused as per averments made in the complaint to give share of profit after sale of lands.

On the touchstone of principles settled in case law cited at bar and considering the factual details reflected in the complaint itself, the Court finds that the Court shall not enter into the defence of the applicant accused at this stage, when there exists liability of applicant accused in view of settlement arrived between the parties after cancellation of sale agreement. Similarly, the contention as to obtaining cheque through police machinery is also one of the defence, which can be established through trial and this Court cannot examine such disputed facts while considering the application under section 482 of Code of Criminal Procedure. Therefore, present application being devoid of merits, both on facts and law is hereby rejected.