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2001 DIGILAW 119 (PAT)

Dadan Bhai v. State Of Bihar

2001-02-09

S.K.CHATTOPADHYAYA

body2001
Judgment S.K.Chattopadhyaya, J. 1. The order taking cognizance under Sections 406 and 420 of the Penal Code is under challenge in this application. 2. On the basis of a complaint the Chief Judicial Magistrate transferred the case to the Judicial Magistrate 1st Class, Patna, who after examining the complainant on solemn affirmation and its witnesses took cognizance of the offence aforesaid. 3. It is alleged in the complaint petition that the complainant being a Company is engaged in the work of distribution of various products throughout the State of Bihar and also out side. The accused persons owned and managed M/s Pertech Computers Ltd., which is involved in manufacture and sale of computers throughout India. They met the complainant at Patna Office and offered attractive terms and timely supply of computers for distribution in Bihar. The security deposit was assured to be refunded after making deduction if required. It was further assured that the Company has huge assets running in crores of rupees and believing on such statements and assurance the complainant paid rupees fifty lacs as security deposit to the accused for future supply of materials. Agreement to that effect was signed but after receiving the said amount of rupees fifty lacs nothing was supplied to him even after repeated request. Whenever the complainant approached the accused persons he was told that some problems were being faced by the sister concerned, namely, M/s. Mindware and M/s. Altoss Ltd. Even after best persuation no goods were supplied to the complainant, but, however, as a part payment, Rs. 4,82,893/- was refunded to the complainant. On 2.4.98 the complainant requested to refund the security deposit alongwith other agreed amount totalling Rs. 64,76,603/- including interest. That having not done, on 7.5.98 a legal notice was sent for refund of security deposit but that too without any effect and moreover the complainant came to know that the accused persons have also cheated another Company, namely, M/s. Pallavi Marketing Ltd. in the same manner. The complainant alleges intention of cheating of the accused persons from its inception and thereby he has been cheated. The complaint petition is Annexure-1. 4. The learned Magistrate on perusal of the complaint petition, statements on solemn affirmation as well as other documents, such as, copy of agreement etc. took cognizance of the offence and issued processes. 5. Mr. The complainant alleges intention of cheating of the accused persons from its inception and thereby he has been cheated. The complaint petition is Annexure-1. 4. The learned Magistrate on perusal of the complaint petition, statements on solemn affirmation as well as other documents, such as, copy of agreement etc. took cognizance of the offence and issued processes. 5. Mr. Jha, learned senior counsel has contended that in order to attract the provision of Section 420 the intention at the time of inception of agreement has to be proved and the same having not been disclosed, the order taking cognizance is bad in law. Further he contends that failure to fulfil the terms of agreement subsequently amounts to breach of contract and cannot be said to be a case of cheating. In support of his contention he has relied on the decision in the case of Gajadhar Nath Sen & Ors V/s. Ramrup Mahto reported in 1981 BBCJ 257 and in the case of Hari Prasad Chamaria V/s. Bishun Kumar Surekha & Ors. reported in 1974 BBCJ 41(SC). Lastly, Mr. Jha contends "that though there are twelve persons added as accused in the complaint petition, there is no specific allegation and, as such, the learned Magistrate has erred in law in issuing process to ail the accused. In support of his contention he has relied on the decision in the case of Dr. Dhanwanti Vaswani V/s. State and another, reported in 1993 SC 1206. He has also relied on other two decisions in the case of G. Sagar Suri and another V/s. State of U.P. and others, reported in (2000)2 SCC 636 : 2000(2) PLJR (SC) 46 and in the case of Hridaya Ranjan Prasad Verma and others V/s. State of Bihar and another, reported in (2000)4 SCC 168 . 6. Countering the argument of Mr. Jha, Mr. Partha Sarthy, fearned counsel for opposite party no. 2, has urged that at this stage the High Court will not be justified in interfering with the order taking cognizance inasmuch as the allegations made in the complaint petition do constitute an offence of cheating. 6. Countering the argument of Mr. Jha, Mr. Partha Sarthy, fearned counsel for opposite party no. 2, has urged that at this stage the High Court will not be justified in interfering with the order taking cognizance inasmuch as the allegations made in the complaint petition do constitute an offence of cheating. Relying on the decision in the case of M/s. Medchl Chemicals & Pharma Pvt. Ltd. V/s. M/s. Biological E. Ltd. and others, reported in J. T. 2000(2) S. C. 426 : 2000(3) PLJR (SC) 56 learned counsel submits that even in a breach of contract the defaulter can be criminally proceeded against. 7. Before considering the allegations made in the complaint the decisions cited by the parties may be dealt with. In the case of Hari Prasad Chamaria (supra) their Lordships found that there was nothing in the complaint petition to show that the accused had dishonest or fraudulent intention at the time the complainant parted with Rs. 35,000/-. There was nothing to show that the accused induced the complainant to pay the said amount by deceiving him. It was not the case of the complainant that a representation was made by the accused persons to him at or before the time he paid the money to them and at that time representation was made, the accused knew the same to be false. Having noticed that their Lordships were of the opinion that the allegations might create a civil liability and would not be sufficient to fasten criminal liability to the accused persons for the offence of cheating. On the other hand, in the present case, as noticed above, the complainant was assured for supply of certain materials and induced him to become their distributor for Bihar. For getting this distributorship on the inducement made by the petitioners, the complainant paid a sum of rupees fifty lacs to accused persons. However, when neither the complainant was made the distributor nor received the security amount, he filed the complaint. Thus, the facts of the present case is quite- distinguishable from the case of Hari Prasad Chamaria (supra). In the case of Gajadhar Nath Sen & Ors. However, when neither the complainant was made the distributor nor received the security amount, he filed the complaint. Thus, the facts of the present case is quite- distinguishable from the case of Hari Prasad Chamaria (supra). In the case of Gajadhar Nath Sen & Ors. (supra) though this Court held that if the terms of the agreement were not Carned out, It may attract civil as well as criminal consequences, but the vital factor to be considered is whether at the time of the agreement there was intention to carry out the terms of the agreement or not. But in the present social scenario, in my opinion, to constitute an offence of cheating the subsequent conduct and intention of the accused is a relevant consideration. In the case of Rajesh Bajaj V/s. State NCT of Delhi and others, reported in (1999)3 SCC 259 it has been observed that "it may be that the facts narrated in the present complaint would as well reveal a commercial transaction or money transaction. But that is hardly a reason for holding that the offence of cheating would elude from such a transaction. In fact, many a cheatings were committed in the course of commercial and also money transactions". Referring to illustration (f) of 415 of the Indian Penal Code their Lordships in paragraph-11 have observed as follows: "11. The crux of the postulate is the intention of the person who induces the victim of his representation and not the nature of the transaction which would become decisive in discerning whether there was commission of offence or not. The complainant has stated In the body of the complaint that he was induced to believe that the respondent would honour payment on receipt of invoices, and that the complainant realised later that the intentions of the respondent were not clear. He also mentioned that the respondent after receiving the goods had sold them to others and still he did not pay the money. Such averments would prima facie make out a case for investigation by the authorities." 8. Therefore, in my view, adopting a strictly hypertechnical approach the High Court in exercising its power under Section 482 of the Code of Criminal Procedure cannot quash the complaint petition in the present case. Such averments would prima facie make out a case for investigation by the authorities." 8. Therefore, in my view, adopting a strictly hypertechnical approach the High Court in exercising its power under Section 482 of the Code of Criminal Procedure cannot quash the complaint petition in the present case. Similarly, at this stage, it cannot be decided on the basis of the evidence whether or not the allegations in the complaint are otherwise correct. The same has to be decided on the basis of the evidence led at the trial in the complaint case but simply because of the fact that there is a remedy provided for breach of contract, that does not by itself clothe the Court to come to a conclusion that civil remedy is the only remedy available to the complainant herein as held by the Supreme Court in the case of M/s. Medchl Chemicals & Pharma Pvt. Ltd. (supra). Only criminal law and civil law remedy can be pursued in diverse situations. As a matter of fact they are not mutually exclusive but clearly co-extensive and essentially differ in their content and consequence. 9. The fact of the decision in the case of G. Sagar Suri and another (supra), in my view, is quite distinguishable and does not help the petitioner of this case. Similarly, the decision in the case of Hridaya Ranjan Prasad Verma and others (supra) is no help to the petitioner because in that case as a counterblast complaint was filed by the complainant against the appellants alleging offences under Sections 418, 420, 423, 504 and 120-B IPC. Before that appellants of that case filed a FIR against the complainant under Sections 406, 420 and 120-B IPC on the allegation of dishonour of cheques by the bank, which were given to the appellants by respondent no.2. 10. It is well settled that each case has to be decided on its own facts and circumstances and strait jacket formula cannot be applied. 11. In the present case specific allegation is that being induced the complainant paid rupees fifty lacs to the accused persons as security deposit on the understanding that he would be given distributorship in the State of Bihar. Neither the commitment Was fulfil nor the total amount was paid. The complainant met the accused persons in Delhi in their factory premises. In the present case specific allegation is that being induced the complainant paid rupees fifty lacs to the accused persons as security deposit on the understanding that he would be given distributorship in the State of Bihar. Neither the commitment Was fulfil nor the total amount was paid. The complainant met the accused persons in Delhi in their factory premises. They assured the complainant that the Company has huge assets running in crores of rupees and, as such, his money would be very much safe. This assurance being made the complainant had parted with rupees fifty iacs in favour of the petitioners. It is alleged that even after receiving the said amount the accused persons never sent any goods to the complainant after repeated request. Another aspect to be borne in mind that on repeated persistence the accused persons refunded a sum of Rs. 4,82,893.00 as a part payment instead of sending the entire amount. This fact clearly indicates that the petitioner did accept rupees fifty lacs from the complainant but did not carry out their commitment. !n these circumstances, it cannot be said that the complaint petition does not make out any case of cheating. 12. It is well settled that exercise of jurisdiction under the inherent power as envisaged in Section 482 of the Code to have the complaint or the charge-sheet quashed is an exception rather than a rule and the case for quashing at the initial stage must have to be treated as rarest of rare so as not to scuttle the prosecution. Reference may be made to the decision of M/s. MedchI Chemicals & Pharma Pvt. Ltd. (supra). Same view has been expressed by this Court in the order dated 25.1.2001 passed in the case of Santosh Chandra Jha V/s. Ravi Shankar Singh and anr. (Cr. Misc. No. 4926/2000 with Cr.Misc. No. 5552/2000) refusing to quash the order taking cognizance as well as the proceeding. 13. In the result, I find no merit in the case and the same is, accordingly, dismissed.