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Rajasthan High Court · body

2006 DIGILAW 362 (RAJ)

Veera Ram v. State of Rajasthan

2006-02-03

H.R.PANWAR

body2006
Judgment H.R. Panwar, J.-All these criminal revision petitions under Section 397/401 of the Code of Criminal Procedure, 1973 (for short, "the Code" hereinafter) involve identical question of law and common facts, therefore, with the consent of the learned Counsel for the parties, these revision petition are being heard together and decided by a common order taking S.B. Criminal Revision Petition No. 19/2005 as the leading case. 2. Briefly stated, the facts, to the extent they are relevant and necessary for decision of these revision petitions, are that the complainants, who are villagers of village Sayala area, district Jalore, lodged a report on 02.05.2002 with Police Station, Sayala, district Jalore, that they sold their crops of cuminseed (Jeera), Guda Jeera, castor-oil seed (Arandi), black and yellow mustard etc. to the petitioners on various dates at a shop of the petitioners situate at Krishi Mandi, Sayala. Subsequently, with a mal-intention, the petitioners did not pay the sale proceeds to the villagers. On this report, a crime report under Sections 420 and 406 IPC, was registered and the police ensured the investigation in various crime reports. It appears that the aforesaid goods were sold by the various complainants on the assurance that in turn the petitioners will sell the goods at Unza Mandi (Gujarat) and pay the sale proceeds to the villagers from whom the goods were taken. The villagers have been paid a size-able amount for the goods sold by them to the petitioners but some of the amount remained outstanding. On Challan being filed by the police for the offences under Sections 420 and 406 IPC, against the petitioners, the Judicial Magistrate, Jalore framed the charge for the offence under Section 420 IPC. However, the trial Court did not find prima facie case for the offence under Section 406 IPC, and the petitioners were discharged of this offence. Aggrieved by the order framing charge under Section 420 IPC, the petitioners have preferred these revision petitions. 3. I have heard learned Counsel for the parties. Perused the orders impugned, as also the Challan papers. 4. On record, there is a consent letter between the petitioners and the villagers stating therein that about 200 agriculturists gave their crops on credit basis to the petitioners on the assurance that the crops on being sold by the petitioners, the sale proceeds will be paid to the villagers who sold their crops on credit basis. 4. On record, there is a consent letter between the petitioners and the villagers stating therein that about 200 agriculturists gave their crops on credit basis to the petitioners on the assurance that the crops on being sold by the petitioners, the sale proceeds will be paid to the villagers who sold their crops on credit basis. The price of the crops received from various villagers, numbering in all 149 agriculturist, was Rs. 74,52,704/-, out of which a sum of Rs. 50 lac was paid to various agriculturists who sold their crops to the petitioners and a details thereof has been filed on record. The grievance of the various complainants is that out of the actual amount of sale proceeds, some amount of each of the agriculturist remained outstanding, which the petitioners failed to pay and, therefore, the petitioners have committed the offence of cheating. 5. It is contended by the learned Counsel for the petitioners that there is no evidence that the petitioners had fraudulent and dishonest intention at the time of taking the goods from the complainants on credit, which is clear from the fact that the petitioners have paid to the various agriculturists various amounts totaling Rs. 50 Lac, which clearly goes to show that right from inception, petitioners had no intention to deceive or cheat the complainants, as there is absolutely no evidence of fraudulent or dishonest intention of the petitioners at the time of buying the goods from the complainants on credit basis. 6. Learned Public Prosecutor and the Counsel for the complainants submit that though the complainant-agriculturists agreed for a particular amount, as mentioned in the schedule produced on record, but the entire amount of sale proceeds has not been paid to them by the petitioners and, therefore, to the extent of non-payment of part of the sale proceeds, they have been cheated. 7. I have given my thoughtful consideration to the rival submissions made by the learned Counsel for the parties. 8. 7. I have given my thoughtful consideration to the rival submissions made by the learned Counsel for the parties. 8. To construe an offence of "cheating", it is essential that 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 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, is said to "cheat." 9. In the instant case, there is absolutely no evidence that the petitioners fraudulently or dishonestly ever induced any of the complainants to deliver the property to them. On the contrary, according to the case of the complainants, they voluntarily sold their crops on credit basis to the petitioners at their shop situated in Krishi Mandi, Sayala with the understanding that the crops, on being sold by the petitioners at Unza Mandi (Gujarat), the sale proceeds, at the rate agreed between them, will be paid to them. From the evidence on record, it has also been established that almost all the agriculturist-complainants have been paid a size-able amount by the petitioners, totaling Rs. 50,00,000/-and for the remaining amount, there is no allegation that the petitioners ever refused to pay the same. Thus, from the evidence on record, it nowhere appears that the petitioners, with fraudulent or dishonest intention, induced the complainants to deliver any property to them. 10. In S.W. Palanitkar & Ors. vs. State of Bihar & Anr., 2002 (1) SCC 241 , the Honble Supreme Court held that for construing an offence under Section 420 IPC, it is necessary to show that a person had fraudulent or dishonest intention at the time of making the promise to say that he committed an act of cheating. A mere failure to keep up promise subsequently cannot be presumed as an act leading to cheating. 11. In K.C. Builders & Anr. A mere failure to keep up promise subsequently cannot be presumed as an act leading to cheating. 11. In K.C. Builders & Anr. vs. Assistant Commissioner of Income Tax, 2004 (2) SCC 731 , the Apex Court held that it is settled law that for establishing the offence of cheating, the complainant is required to show that the accused had fraudulent or dishonest intention at the time of making promise or misrepresentation. From his making failure to keep up promise subsequently, such a culpable intention right at the beginning, that is, at the time when the promise was made cannot be presumed. As there was absence of dishonest and fraudulent intention, the question of committing offence under Section 420 IPC does not arise. 12. In Alpic Finance Ltd. vs. P. Sadasivan & Anr., 2001 CrLR (SC) 217, the Honble Supreme held as under:-"The facts in the present case have to be appreciated in the light of the various decisions of this Court. When somebody suffers injury to his person, property or reputation, he may have remedies both under civil and criminal law. The injury alleged may form basis of civil claim and may also constitute the ingredients of some crime punishable under criminal law. When there is dispute between the parties arising out of a transaction involving passing of valuable properties between them, the aggrieved person may have right to sue for damages or compensation and at the same time, law permits the victim to proceed against the wrongdoer for having committed an offence of criminal breach of trust or cheating. Here the main offence alleged by the appellant is that respondents committed the offence under Section 420, IPC, and the case of the appellant is that respondents have cheated him and thereby dishonestly induced him to deliver property. To deceive is to induce a man to believe that a thing is true which is false and which the person practicing the deceit knows or believes to be false. It must also be shown that there existed a fraudulent and dishonest intention at the time of commission of the offence. There is no allegation that the respondents made any willful misrepresentation. Even according to the appellant, parties entered into a valid lease agreement and the grievance of the appellant is that the respondents failed to discharge their contractual obligations. It must also be shown that there existed a fraudulent and dishonest intention at the time of commission of the offence. There is no allegation that the respondents made any willful misrepresentation. Even according to the appellant, parties entered into a valid lease agreement and the grievance of the appellant is that the respondents failed to discharge their contractual obligations. In the complaint, there is no allegation that there was fraud or dishonest inducement on the part of the respondents and thereby the respondents parted with the property. It is trite law and common sense that an honest man entering into a contract is deemed to represent that he has the present intention of carrying it out but if , having accepted the pecuniary advantage involved in the transaction, he fails to pay his debt, he does not necessarily evade the debt by deception." 13. In Ajay Mitra vs. State of M.P. & Ors., 2003 CrLR (SC) 392, the Honble Supreme Court held that a guilty intention is an essential ingredient of the offence of cheating. In other words, "mens rea" on the part of the accused must be established before he can be convicted of an offence of cheating. In Mahadeo Prasad vs. State of West Bengal, AIR 1954 SC 724 , the Honble Supreme Court held as under:-"Where the charge against the accused is under Section 420 in that he induced the complainant to part with his goods, on the understanding that the accused would pay for the same on delivery but did not pay, if the accused had at the time he promised to pay cash against delivery an intention to do so, the fact that he did not pay would not convert the transaction into one of cheating. But if on the other hand he had no intention whatsoever to pay but merely said that he would do so in order to induce the complainant to part with the goods then a case of cheating would be established." 14. In the instant case, the goods were taken by the petitioners from the various agriculturist-complainants on being sold on credit basis with the promise to pay them the sale proceeds at the rate agreed between the parties on being sold at Unza Mandi (Gujarat) and subsequently, the petitioners have paid to the various agriculturist-complainants, as noticed above, a sum of Rs. 50 lac. 50 lac. Therefore, it cannot be said that the petitioners induced the complainant-agriculturists to bring their crops to the petitioners shop with a fraudulent and dishonest intention since inception with a view not to pay any amount to the agriculturist-complainants after purchasing the goods from them on credit basis and keeping the sale proceeds thereof with them. In this view of the matter, the very essential ingredients for construing an offence under Section 420, IPC are not made out and, therefore, in my view, the trial Court fell in error in framing the charge against the petitioners for the offence under Section 420, IPC. The impugned orders framing charge cannot be sustained and liable to be set aside. 15. Consequently, all these revision petitions filed by the petitioners are allowed. The impugned orders framing charge against the petitioners for the offence under Section 420, IPC are set aside. The petitioners are discharge of the offence under Section 420 IPC. The stay petitions in all the revision petitions stand disposed of .