Shaik Mahaboob Vali vs The State Of Ap & Anr.

This Criminal Petition is filed by the petitioner/Accused No.2 under Section 482 of the Code of Criminal Procedure, 1973, and the corresponding provision under the Bharatiya Nagarik Suraksha Sanhita, 2023, to quash the proceedings in C.C.No.701 of 2020 on the file of the learned Judicial Magistrate of First Class, Nandyal, Kurnool District, for the offences punishable under Sections 403, 406, 420 read with Section 34 of the Indian Penal Code, 1860, and Section 5 of the Prize Chits and Money Circulation Scheme (Banning) Act, 1978.

The case of the petitioner is that he has been arrayed as Accused No.2 only on the ground that he is the son-in-law of Accused No.1. According to the petitioner, he has no connection whatsoever with the chit business allegedly conducted by Accused No.1 and none of the witnesses has made any specific allegation against him regarding inducement of the victims, receipt of their money, or participation in the alleged transactions. It is further stated that the petitioner has been carrying on his own business even prior to his marriage with the daughter of Accused No.1.

Sri M.V. Raja Raam, learned counsel for the petitioner contended that the material collected during investigation does not disclose the commission of any offence by the petitioner, statements of the witnesses are substantially stereotyped and do not attribute any overt act to the petitioner and only to harass the petitioner who is none other than the son-in-law of the accused, he is arrayed as accused. Per contra, Smt. K. Priyanka Lakshmi, learned Assistant Public Prosecutor, argued that the matter is at an initial stage and that the statements of the victims disclose that Accused No.1 had allegedly given amounts to the petitioner for investment in his business.

As borne out by the record, basing on the report of respondent No.2, a case in Crime No.159 of 2017 was registered of the offences stated supra. During investigation, the Investigating Officer examined the victims/LWs.1 to 49 and thereafter laid the charge sheet alleging, inter alia, that Accused No.1 was conducting chit business, collected amounts from the victims, failed to return the chit subscription amounts and, after committing default, allegedly gave the amounts so collected to the petitioner/Accused No.2, who is his son-in-law, for investment in the petitioner's business.

The principal question that falls for consideration is whether the allegations and the material collected during investigation, even if accepted on their face value, disclose the essential ingredients of the offences alleged against the petitioner so as to warrant his prosecution.

In this regard, it is to be noted that it is well settled that for the purpose of exercising power under Section 482 Code of Criminal Procedure, to quash FIR or a complaint, the High Court would have to proceed entirely on the basis of the allegations made in the complaint or the documents accompanying the same per se and it has no jurisdiction to examine the correctness or otherwise of the allegations. It is also well settled that if the allegations made in the FIR, taken on the face value and accepted in their entirety, do not constitute an offense, the criminal proceedings instituted on the basis of such FIR should be quashed. Further, the power of quashing the criminal proceedings should be exercised very sparingly and with circumspection and that too, in the rarest of rare cases and that the court will not be justified in embarking upon an inquiry as to the reliability or genuineness or otherwise of the allegations made in the FIR or the complaint and that the extraordinary or inherent powers do not confer an arbitrary jurisdiction on the Court to act according to its whims or caprice as held by the Hon’ble Apex Court in State of Haryana and Others v. Bhajan Lal and Others^{11.1992 Supplement 1 SCC 335}. Further, Hon’ble Apex Court has enunciated seven cardinal principles and they are reproduced as follows:

In the present case, a careful consideration of the allegations in the report, the statements of the witnesses and the material referred to in the charge sheet does not disclose any specific overt act attributable to the petitioner. There is no specific allegation that the petitioner induced any of the victims to part with their money, represented himself as conducting the chit business, collected chit subscriptions from the victims, or received any amount from any of the victims pursuant to the alleged inducement. Mere reference to the petitioner as the son-in-law of Accused No.1, by itself, cannot constitute a criminal offence or establish his participation in the alleged transactions.

The material placed before this Court further indicates that the petitioner was carrying on his own business even prior to his marriage with the daughter of Accused No.1. The petitioner has relied upon his income-tax returns for the assessment years 2016-2017 to 2019-2020 and the wedding card to substantiate that his business was in existence prior to the marriage. The charge sheet also refers to an agreement entered into by the petitioner with one of the witnesses for purchase of a quarry for the purposes of his business, involving an amount of Rs.35,42,500/-. The existence of such business transaction, without anything more, cannot establish that the petitioner had induced the victims or dishonestly received or misappropriated their money.

It is significant that the charge sheet does not specifically identify any victim from whom the petitioner is alleged to have directly received money. Nor does it disclose the date, manner or circumstances in which the petitioner allegedly induced any victim, or the particular transaction by which he is said to have dishonestly misappropriated or converted the money of the victims for his own use. The allegation that Accused No.1 had informed some persons that he was giving amounts to his son-in-law for investment in the latter's business is, by itself, insufficient to establish the petitioner's involvement in the commission of the alleged offences.

The offence under Section 403 of the Indian Penal Code requires dishonest misappropriation or conversion to one's own use of movable property. Section 406 requires entrustment and dishonest misappropriation or conversion in breach of trust, while Section 420 requires cheating and dishonest inducement to deliver property. The material available on record, even if taken at its highest, does not disclose the essential ingredients of any of these offences insofar as the petitioner is concerned. Likewise, there is no specific material showing that the petitioner participated in or promoted the alleged prize chit or money circulation scheme so as to attract Section 5 of the Prize Chits and Money Circulation Scheme (Banning) Act, 1978.

The allegation of common intention under Section 34 of the Indian Penal Code also cannot, by itself, supply the missing ingredients of the substantive offences. There must be material indicating participation of the petitioner in the criminal act with the requisite common intention. In the absence of any specific allegation or material showing such participation, the mere relationship of the petitioner with Accused No.1 cannot be treated as a substitute for proof of common intention.

This Court is conscious that, while exercising jurisdiction under Section 482 of the Code, it ordinarily should not undertake an elaborate appreciation of evidence or determine the truthfulness of the allegations. The present case, however, does not require an assessment of the credibility of the witnesses. The conclusion follows from the allegations and the material as stated in the charge sheet itself. Even assuming the allegations to be true in their entirety, the essential ingredients of the offences alleged against the petitioner are not made out. Therefore, requiring the petitioner to undergo the rigours of a criminal trial in the absence of the foundational allegations necessary to constitute the offences would serve no useful purpose and would amount to permitting continuation of proceedings which do not disclose a prima facie case against him.

The facts of the case, therefore, fall within the principles enunciated by the Hon'ble Supreme Court in Bhajan Lal (supra) particularly the principle that where the uncontroverted allegations and the evidence collected in support thereof do not disclose the commission of any offence and make out a case against the accused, the High Court would be justified in exercising its inherent jurisdiction to quash the proceedings.

For the foregoing reasons, this Court is of the considered view that the material on record does not disclose the commission of the offences alleged against the petitioner/Accused No.2. Continuation of the proceedings against him in C.C.No.701 of 2020 on the file of the learned Judicial Magistrate of First Class, Nandyal, Kurnool District, would amount to an abuse of the process of Court and would not advance the ends of justice.

Accordingly, the Criminal Petition is allowed. The proceedings against the petitioner/Accused No.2 in C.C.No.701 of 2020 on the file of the learned Judicial Magistrate of First Class, Nandyal, Kurnool District, for the offences punishable under Sections 403, 406, 420 read with Section 34 of the Indian Penal Code, 1860, and Section 5 of the Prize Chits and Money Circulation Scheme (Banning) Act, 1978, are hereby quashed.

As a sequel thereto, the pending miscellaneous petitions, if any, shall stand closed.