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2001 DIGILAW 813 (PAT)

N. M. Krishnan v. State Of Bihar

2001-08-31

P.K.SINHA

body2001
Judgment P.K.Sinha, J. 1. This is an application under Sec. 482 of the Code of Criminal Procedure ("the Code". in short} for quashing order dated 16-12-1995 recorded by a Judicial Magistrate of first Class, at Patna in Case No. 1003 (C) of 1995 which was filed by Opposite Party No. 2. Capt. Uday Kumar Dixit whereby and where under the learned Magistrate after enquiry under Sec. 202 of the Code found a prima jade case made out against the petitioner and other accused under Secs. 406. 420 and 120B of the Indian Penal Code and summoned the accused to face the trial as also to quash the entire criminal proceeding arising out of the aforesaid case. 2. The facts in brief are that the complainant who had entered into business approached accused No. 1. A.K Sinha who was in business of arranging finance against immovable properties for grant of loan of 25 lacs and was assured by A.K Sinha that the loan could be managed with Senthil Financier and Builders. Madras ("the Company" in short) with the proper sureties and charged from him Rs. 25.000.00 as his commission. This petitioner is said to be the Managing Partner of the aforesaid Company who as alleged sent a latter dated 11-5-1994 asking the complainant to deposit Rs. 1.20.300.00 by draft to enable the company to complete with the formalities of registration etc. However allegation is that accused A. K. Sinha and accused No. 4. Mr. Arumugam inspected the property of the complainant at Jamshedpur at which time Arumugam demanded a sum of Rs. 10.000.00 for giving a proper report which was also paid to him. The complainant accordingly sent a draft of Rs. 1,20,300.00 to the petitioner and thereafter the complainant received intimation from accused No. 3. S. Subramaniam. Chief Trustee of MAM Annamalayar Trust, intimating that the loan would be paid on 4-7-1994. However, the payment continued to be deferred from time to time on the pretext that account of the company had been sealed by the Enforcement Directorate, FERA Board. 3. Allegation is that on 20-2-1995 the complainant signed a receipt of Rs. S. Subramaniam. Chief Trustee of MAM Annamalayar Trust, intimating that the loan would be paid on 4-7-1994. However, the payment continued to be deferred from time to time on the pretext that account of the company had been sealed by the Enforcement Directorate, FERA Board. 3. Allegation is that on 20-2-1995 the complainant signed a receipt of Rs. 10 lakhs at the behest of this petitioner and the accused person handed over a post dated cheque to him informing the complainant that the connected account was not seized by Enforcement Directorate hut when the cheque was deposited it is bounced back on the ground that the account was so frozen. 4. It is alleged that thereafter the complainant contacted this petitioner and thereafter the amount of Rs. 1.20.300.00 which was earlier paid by the complainant to the Company was returned to him with the intimation that the loan was cancelled. The grievance of the complainant, as in the complaint petition is that though the aforesaid amount was returned but receipt earlier granted by the complainant for Rs. 10 lakhs was not returned nor the expenses met by the complainant while travelling to and from Madras in connection with the loan. Similarly accused No. 1 and accused No. 4 also did hot return the money which was paid to them. 5. Learned counsel for the petitioner submits that on bare reading of the complaint petition and the supporting material as adduced in course of enquiry those do not make out any offence against the present petitioner, further submitting that accused No. 1. as admitted by the complaint was having Independent business, hence this petitioner was not responsible for his action or for the acts of other accused, learned counsel submitted that when the company was unable to pay the amount of the sanctioned loan for the reasons beyond control such as freezing of the accounts by the Enforcement Directorate of which complainant admittedly was informed the company of the petitioner had returned the entire amount which was earlier paid by the complainant to the company for processing the loan. It is argued that in such circumstance no criminal offence is made out in the facts of the case and in so far as the other claims of the complainant are concerned, for compensating him for harassment or for the expenditure met by him while travelling to Madras in connection with this loan, for those no criminal action is warranted though the complainant could have gone for civil remedy for such claims. 6. In view of the aforesaid circumstances, it has been submitted there is hardly any chance of conviction on the materials on record even if those are not controverter. The only point that remains against the petitioner as submitted, is that the company had given a cheque of Rs. ten lakhs., the petitioner intimating that the aforesaid account was not frozen but the cheque had bounced but it is also admitted fact that, thereafter, receiving that information money paid by the complainant to the company was returned. 7. Learned Additional Public Prosecutor in course of arguments conceded that in the facts on record the element of the Criminal intention of the petitioner is lacking. However, learned counsel for Opposite Party No. 2 submitted that the complaint petition and materials brought on record in course of enquiry spelled out commission of offence against the petitioner so much so that a cheque was issued to him for an account which was frozen by the Enforcement Directorate of which fact the company must have been aware. 8. To support the arguments learned counsel for the petitioner has relied upon a decision of the Apex Court in the Case of Alpic Finance Ltd. V/s. P. Sadasivan and another. In that case default was made by the accused in payment of installments by way of repayment of loan advanced by the complainant under a lease agreement for purchase of some articles and thereafter a complaint was filed alleging commission of offence under Sec. 420 of the IPC. Their Lordships of the Supreme Court, on the basis of the facts as obtaining in that case, held that the complaint did not disclose element of deception in the entire transaction and therefore, the criminal proceeding was fit to be quashed. 9. It is well settled that on the same facts aggrieved party could go for civil remedy and also file a criminal case if the acts alleged by him disclose commission of a criminal offence. 9. It is well settled that on the same facts aggrieved party could go for civil remedy and also file a criminal case if the acts alleged by him disclose commission of a criminal offence. However, it is also well settled that when no criminal offence is made out from the facts revealed in the complaint and the evidence adduced in course of enquiry the criminal case cannot be continued. It is also well settled that when the remedy is exclusively of civil nature, then also a criminal prosecution could be quashed. In the case of Madhavrao Jiwaji Rao Scindia and another V/s. Sambhajirao Chandrojirao Angre and others their lordships of the Supreme Court have observed thus, the legal position is well settled that when a prosecution at the initial stage is asked to be quashed, the test to be applied by the Court is as to whether the uncontroverted allegations as made prima facie establish the offence. It is also for the Court to take into consideration any special features which appear in a particular case to consider whether it is expedient and in the interest of justice to permit a prosecution to continue. This is so on the basis that the Court cannot be utilised for any oblique purpose and where in the opinion of the Court chances of an ultimate conviction are bleak and, therefore, no useful purpose is likely to be served by allowing a criminal prosecution to continue the Court may while taking into consideration the special facts of a case also quash the proceeding even though it may be at a preliminary stage." 10. The petitioner has been summoned to face trial under Secs. 406, 420 and 120 of the Indian Penal Code. An offence of criminal breach of trust punishable under Sec. 406 of the Indian Penal Code is committed when a person being in any manner entrusted with property or with any dominion over the property, dishonestly misappropriates or converts to his own use that property or dishonestly uses or disposes of that property in violation of any direction of law prescribing mode in which such trust is to be discharged or of any legal contract express or implied, which he has made touching the discharge of such trust or wilfully suffers any other persons so to do. 11. 11. The materials on the record would show as also admitted by the learned counsel for opposite party No. 2. that a draft of Rs. 1,20,300.00 was prepared in the name of the company of which this petitioner is said to be the Managing Partner. The fact stands that when the loan did not materialize, that entire amount was returned by the company to the complainant. In this way it is difficult to infer that anything was done dishonestly on part of the petitioner. 12. In so far as the offence of cheating is concerned, this offence is committed by a person who 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 do anything which he would not do or omit to 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. In the circumstances of the case in so far as this petitioner is concerned, it is difficult to hold that this petitioner did anything fraudulently and dishonestly. 13. In such circumstance allegation of offence punishable under Sec. 120B also cannot stick to the petitioner. 14. When the entire amount that was received by the company was returned back complainant has raised question of interest thereon compensation for his travelling to Madras etc. These are such claims which could be settled in a civil action as a Civil Court can alone come to conclusion as to whether or not any further amount remains payable and. if so, how much. 15. In view of the discussion aforesaid. I do not find that, in so far as this petitioner is concerned the allegations in the complaint or the evidence in course of enquiry make out any criminal offence against the petitioner. 16. This being so, in so far as the petitioner is concerned, criminal prosecution and the impugned order dated 16-12-1995 are hereby quashed. It is, however, made clear that none of the observations or findings made by this Court in this order would be considered by the learned Lower Court while holding trial for other accused or even when considering framing of the charges at appropriate stage, against them.