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2001 DIGILAW 484 (MAD)

Maypar Leather Manufacturing Company Limited and others v. S. M. Sayeed

2001-04-18

B.AKBAR BASHA KHADIRI

body2001
ORDER: The instant Criminal Original Petition is to call for the records and to quash the proceedings in C.C.No.2802 of 1998, pending on the file of the X Metropolitan Magistrate, Egmore, Madras. 2. This Criminal Original Petition has arisen in this way: Initially, the respondent preferred a private complaint against the petitioners alleging that they have committed offence under Secs.406 and 420, I.P.C., which the learned Metropolitan Magistrate took on his file. The facts of the complaint briefly stated are: (i) The first petitioner is a private limited company. The second petitioner is the chair-person and petitioners 3 and 4 herein are her sons, who also happen to be the Directors of the Company. The petitioners were running a leather manufacturing company under the name and style of Maypar Leather Manufacturing Company Limited. The respondent/complainant is the dealer in firewood, coal and coke. During November, 1996, all the petitioners/accused approached the respondent/complainant for supply of firewood and coal to the tune of Rs.2 lakhs to be used as fuel for their boilers and promised that they would make over the payment within six months period in one lump sum after lifting the finished leather for exports. The respondent/complainant accordingly supplied coal from his godown at Vysarpadi to the petitioners/accused from 11.11.1996 to 17.6.1997. The total value of the same is Rs.2 lakhs covered by nineteen bills. The petitioners/accused did not make the payment. When the respondent/complainant demanded payment, the petitioners/accused gave evasive replies. Later, the respondent/complainant came to know that he was squarely cheated by the petitioners/accused. Their acts have resulted in wrongful loss to the respondent/complainant. The petitioners accused have also cheated the complainant. Therefore, he preferred a private complaint under Secs.406 and 420, I.P.C. The learned X Metropolitan Magistrate took cognizance of the same in C.C.No.2802 of 1998 and issued summons to the petitioners/ accused. As against the learned Metropolitan Magistrate taking cognizance of the proceedings, the petitioners/ accused have come forward with the instant criminal original petition to quash the proceedings. Their contention is that the respondent/ complainant and the petitioners entered into contract for supply of coal, but the payment could not be made. As against the learned Metropolitan Magistrate taking cognizance of the proceedings, the petitioners/ accused have come forward with the instant criminal original petition to quash the proceedings. Their contention is that the respondent/ complainant and the petitioners entered into contract for supply of coal, but the payment could not be made. They have stated that coal supplied by the respondent/ complainant was of inferior quality and there had been closure of all tanneries in Tamil Nadu on account of the order passed by the Honourable Supreme Court regarding control of pollution and that also contributed to the non-payment. According to them, the complaint does not make out the ingredients of offence under Secs.406 and 420, I.P.C. 3. Heard both the sides. According to the learned counsel for the petitioners, the transaction between the petitioners and the respondent was only a civil contract, breach of which is to be taken as civil liability by institution of appropriate proceedings in Civil Court, but the petitioner cannot seek to get sanction of punishment to the accused by converting a civil dispute into a criminal dispute. According to them, the essential ingredients of cheating is not made out in the complaint. 4. Sec.415, I.RC. reads as under: “415. Cheating: Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person or to consent that any person shall retain any property, or intentionally induces the person so deceived to do or omit to be anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, mind reputation or property, is said to”cheat“. Explanation: A dishonest concealment of fact is a deception within the meaning of this Section”. The essential ingredients to attract offence under Sec.415, I.P.C. are: (1) Deception of any person, (2)(a) Fraudulently or dishonestly inducing that persons (i) to deliver any property to any person or (ii) to consent that any person shall retain any property, or (b) intentionally inducing that person to do or omit to do anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, mind, reputation or property. What is deception should also be considered. What is deception should also be considered. Deception means causing to believe what is false; or misleading as to a matter of fact, or leading into error. To constitute cheating there must be deception which must precede the act under the first part of the Section, the delivery or retention of property or the act or omission referred to in the second part. In other words, there should be an intention on the part of the person, who commits the act to make the deceived person to believe what is false at the inception of the act and also it should continue till the end of the act. 5. I have carefully gone through the complaint. In the complaint, the respondent/ complainant had stated that he is firewood dealer, and that the petitioners/ accused are engaged in leather processing and they have a boiler which is used in leather processing. It is not as if the petitioners herein did not have a factory, but represented that they have a factory and they need fuel for the boilers. In the complaint, the respondent/ complainant himself had admitted that he had visited the factory and also satisfied himself that their requirement is genuine one. When there is subjective satisfaction on the part of the respondent/ complainant about the requirement of coal to be used as fuel for the boilers, it cannot be said that the representation alleged to have been made by the petitioners herein that they need coal for their boiler was a false representation, or at the very inception of the transaction, the petitioners had intention to cheat the respondent, i.e., the petitioner had the intention of making a false representation. 6. The facts of the case are almost identical to the facts of the case reported in Ratanlal Sharma and others v. Mangaram Ghanshyamdas and another, 1976 L.W. (Crl.) 162, wherein Ratnavel Pandian, J., as His Lordship then was, has observed as under: “5. Sec.415, I.P.C. defines what is cheating. To constitute an offence of cheating under this Section, the following ingredients are to be proved. Sec.415, I.P.C. defines what is cheating. To constitute an offence of cheating under this Section, the following ingredients are to be proved. They are: (i) Deception of any person, and thereby, (2) fraudulently or dishonestly inducing that person or to consent that any person shall retain any property or intentionally inducing the person deceived to do or omit if he were not so deceived and which act or omission causes, or is likely to cause damage to that person in body, mind, reputation or property. Intention can only be gathered from the surrounding circumstances. The term ‘deceiving’ is not defined in this Section. Deception is an essential ingredient of the offence of cheating. A person is said to have been deceived when it is proved that he was induced to believe as true which was untrue. The evidence must establish the existence of a fraudulent or dishonest intention at the lime of the commission of the act in respect of which cheating is alleged. Therefore the question whether there was intention to deceive must be answered at the time when the contract was made. If the accused had at the time when he induced the complainant to part with the goods promised to pay cash against delivery to the act that he did not pay would not by itself convert the transaction into one of cheating, if the accused has intention to do but it must be shown that he had no intention whatsoever to pay but merely said that he could do so in order to induce the complainant to part with the goods. Only in the contingency a case of cheating would be established. Mere breach of cor tract as I find in the instant case, cannot give rise to a criminal prosecution, the distinction between a case of breach of contract and one of cheating depends upon the intention that the accused at the time of the alleged inducement which of course may be adjudged by the subsequent conduct.” 7. The petitioners herein have alleged that they had dealings with the respondent even during earlier occasions and they have made huge payments running to crores of rupees. They have also produced typed set of balance-sheet, etc. We are not concerned about the evidentiary aspect, and the documents produced by the accused need not be considered at this stage. The petitioners herein have alleged that they had dealings with the respondent even during earlier occasions and they have made huge payments running to crores of rupees. They have also produced typed set of balance-sheet, etc. We are not concerned about the evidentiary aspect, and the documents produced by the accused need not be considered at this stage. They have also pleaded that their factory is being run for more than a century and they are also running several charitable institutions, to indicate that they have no intention to cheat the respondent. They have also pleaded certain constraints in making the payment. The reason as to why they have not made the payment is not for us to probe at this stage. Suffice it to mention that the petitioners have entered into an oral contract with the respondent for supply of coal by the respondent to the tune of Rs.2,00,000, that the coal was supplied, but the petitioners had not made any payment, which would amount to breach of contract, and that the matter is purely of civil nature. 8. The learned counsel for the petitioners drew my attention to the decision reported in State of Bihar v. K.J.D. Singh, 1994 S.C.C. (Crl.) 63, wherein their Lordships of the Supreme Court have pointed out that the inherent power under Sec.482, Crl.P.C. has to be exercised for the ends of the justice and should not be arbitrally exercised to cut short the normal process of a criminal trial. Their Lordships have also pointed out that it is not permissible to quash the proceedings or appreciate the evidence at the stage when the trial had not even commenced and therefore, this Court should not quash the proceedings. 9. The question whether or not the petitioners had the intention to cheat the respondent has to be considered by the trial Court during the trial and that cannot be gone into at this stage. In proceedings under Sec.482, Crl.P.C., this Court has to look into the complaint and accompanying documents to find out whether a prima facie case is made out against the accused. I have already pointed out that perusal of the complaint shows that the matter is purely a matter of civil nature and the respondent/ complainant is trying to convert a civil profile into a criminal outfit. This Criminal Original Petition is allowed. I have already pointed out that perusal of the complaint shows that the matter is purely a matter of civil nature and the respondent/ complainant is trying to convert a civil profile into a criminal outfit. This Criminal Original Petition is allowed. The further proceedings in C.C.No.2802 of 1998 shall stand quashed. Consequently, Crl.M.P.Nos.5502 and 5503 of 1998 are closed.