Coromandal Cements Limited, rep. by its M. D. v. State of A. P. rep. by Public Prosecutor
2006-03-31
B.SESHASAYANA REDDY
body2006
DigiLaw.ai
ORDER These two criminal petitions are filed under Section 482 of the Code of Criminal Procedure by the accused in Crime No.6 of 2000 with a prayer to quash the F.I.R. therein. 2. Petitioners in Crl.P.No.250 of 2004 are A-1 and A-2 and the petitioner in Crl.P.No.337 of 2004 is A-3. 3rd respondent is the complainant and a case in Crime No.6 of 2004 for the offences under Sections 406 and 420 I.P.C., came to be registered on his report. 3. 3rd respondent is a developer of energy. An agreement came to be entered between the 3rd respondent and the petitioners-accused with regard to the purchase of energy generated by the 3'd respondent. The terms of the agreement are reduced into writing and it is dated 18-5-2001. under the said agreement the 3rd respondent company will wheel energy about 10 lakhs per month, subject to availability, to the petitioners-accused through A.P.TRANSCO lines from its biomass power generation station located at Pandipadu (V), Kallur (M), Kurnool District on continuous basis starting from the billing month of April, 2001 ,till 2003. It appears that some of the developers questioned the 3rd respondent authority to impose wheeling charges by filing writ petitions. The writ petitions went in favour of the developers and thereupon the Transmission Corporation, A.P., Ltd., challenged the order before the Supreme Court and the Supreme Court passed the following interim order:- "The interim order dated 7-5-2003 is confirmed so as to remain in operation during the hearing of the appeals. However, over and above the bank guarantees covered by the order dated 7-5-2003 we are not inclined to ask for further bank guarantees being furnished. The parties, needless to say, shall remain bound to comply with the ultimate decision given by this Court. During the pendency of the appeals, the transmission charges shall be liable to be paid as per the term of the agreement subsisting between the parties. Printing dispensed with. The appeals shall be heard on the SLP paper books. Parties may file additional document, if any, within six weeks. Original record shall be requisitioned." 4. On the basis of the interim order passed in the Spl. Leave Petitions, Central Power Distribution Company of A.P., Ltd., issued letter to the petitioners-accused directing them to pay wheeling charges.
Printing dispensed with. The appeals shall be heard on the SLP paper books. Parties may file additional document, if any, within six weeks. Original record shall be requisitioned." 4. On the basis of the interim order passed in the Spl. Leave Petitions, Central Power Distribution Company of A.P., Ltd., issued letter to the petitioners-accused directing them to pay wheeling charges. There upon the petitioners-accused addressed a letter to the 3rd respondent-complainant for discussion with regard to the payment of wheeling charges and the last letter addressed to the 3rd respondent-complainant by the petitioners-accused is dated 7-1-2004 which reads as under: "Please refer our letter dt. 24-12-2003, wherein we have requested to attend a meeting on 5th January, 2004 at 3.00 p.m. But the meeting was not convened as you came only after 5.30 p.m. Now, we request you to attend a meeting with the undersigned and Mr. P.Ch.Nagi Reddy, Asst. Manager (A & ) on 23rd January, 2004 (Friday) at 3.00 p.m. Please note that the issue is to be settled between you and APCPDCL only and we are no way concern with the dispute. We are arranging a meeting at your request only". 5. Therefore, 3rd respondent-complainant presented a report before the S.H.O. Gooty P.S. Ananthapur District alleging that the petitioners-accused having consumed the energy supplied by it refused to pay the value of the energy and thereby they committed a breach of trust and cheating punishable under Sections 406 and 420 I.P.C. Hence, this Criminal Petitions by the petitioners-accused with a prayer to quash the F.I.R. in Crime No.6 of 2004. 6. learned Counsel appearing for the petitioners submits that the dispute between the petitioners/accused and 3rd respondent is purely a civil in nature and therefore, initiation of Criminal proceeding against the petitioners/accused amount to abuse of process of law. He further submits that even if the complaint averments are taken in toto, ingredients of Sections 406 and 420 I.P.C. are not made out and thus the F.I.R. in Crime No.6 of 2004 is liable to be quashed. He took me to the terms and conditions of the agreement entered between the petitioners-accused and 3rd respondent. He also referred clause 24 of the agreement which deals with the Arbitration in case of dispute between the parties.
He took me to the terms and conditions of the agreement entered between the petitioners-accused and 3rd respondent. He also referred clause 24 of the agreement which deals with the Arbitration in case of dispute between the parties. For better understanding, I may refer the relevant clause in the agreement and it is thus:- "In the event of any dispute or difference between the parties hereto arising out of above or under or touching this agreement or relating to the rights and liabilities of the parties shall in the first instant be amicably resolved, failing which such disputes and differences shall be referred to arbitration in accordance with the provisions of the Arbitration and Conciliation Act, 1996 or any statutory modification thereof for the time being in force." In support of submissions, the learned counsel placed reliance on the decisions of Supreme Court in S.W. Palanitkar v. State of Bihar, 2002 (1) ALT (Crl.) 219 (SC) = 2002 (1) ALD (Crl.) 108 (SC) and Girish Sarwate v. State of A.P. rep. by Public Prosecutor, 2005 (1) ALT (Crl.) 1 (F.B.)(A.P.). In the first cited decision, the Supreme Court held that every breach of trust may not result in a penal offence of criminal breach of trust unless there is evidence of a mental act of fraudulent misappropriation. An act of breach of trust involves a civil wrong in respect of which person wronged may seek his redress for damages in a civil Court a breach of trust with mens rea gives rise to a criminal prosecution as well. In the second cited decision a full bench of this Court held that Section 482 Cr.P.C. is in the nature of protecting the inherent power of the High Court and as a matter of fact, this does not confer any power on the High Court. It merely states that nothing in the Criminal Procedure Code shall be deemed to limit or affect the inherent powers of the High Court. These inherent powers to the High Court are available to make such orders as maybe necessary to give effect to any order under he Code or to prevent abuse of the process of any Court or other wise to secure the ends of justice.
These inherent powers to the High Court are available to make such orders as maybe necessary to give effect to any order under he Code or to prevent abuse of the process of any Court or other wise to secure the ends of justice. Therefore, under Section 482 Cr.P.C., the High Court's inherent power to pass orders to secure the ends of justice is not limited by any provision in the Criminal Procedure Code. Therefore, even on those principles, if an FIR does not disclose any offence and a person complains to the High Court, the High Court cannot shut its door to him and tell him to face the investigation and also face the trial. In other terms, this has been the consistent view of the Supreme Court as well. The Supreme Court has in no uncertain terms stated that power under Section 482 Cr.P.C. to quash an FIR or a complaint is available to the High Court, provided the conditions laid down in its judgments are satisfied. 7. Learned counsel appearing for the 3rd respondent submits that the petitioners-accused are in no way concerned with the wheeling charges and it is the dispute between the 3rd respondent and A.P. Regulatory Commission and the 3rd respondent-complainant filed a writ petition in the High Court and secured certain interim directions. A further submission has been made that the petitioners-accused cannot withhold the payment after utilizing the energy developed by the 3rd respondent company and therefore, the ingredients of Sections 406 and 420 I. P. C. are made out. He would further contend that the petitioners-accused are not justified in stopping the payments of entire consumption charges and at the most they can withhold the amount equivalent to wheeling charges demanded by the A.P. Regulatory Commission. 8. It is not in dispute that the petitioners-accused and 3rd respondent entered into power purchase agreement. As per the terms and conditions of the agreement, - the petitioners-accused being the purchasers of the power developed by the 3rd respondent company, provided a bank guarantee towards one month power charges and-corporate guarantee for another one month power charges. The petitioners-accused admittedly paid the charges till June, 2003. The genesis of the dispute is the letter dated 28-7-2003 addressed by the Central Power Distribution Company of A.P. Limited to the petitioners-accused directing them to pay the wheeling charges.
The petitioners-accused admittedly paid the charges till June, 2003. The genesis of the dispute is the letter dated 28-7-2003 addressed by the Central Power Distribution Company of A.P. Limited to the petitioners-accused directing them to pay the wheeling charges. The bill submitted by the Central power Distribution Company for the month of July, 2003 includes the wheeling charges of Rs.3, 90, 278-00. Indeed 1st petitioner company addressed a letter to the 3rd respondent-complainant for joint meeting and the last of the series of letters is dated 7-1-2004, which has been already been extracted above. 9. The ingredients in order to constitute a criminal breach of trust (i) entrusting a person with property or with any dominion over property (ii) that person entrusted (a) dishonestly misappropriating or converting that property to his own use; or (b) dishonestly using or disposing of that property or willfully suffering any other person so to do in violation (i) of any direction of law prescribing the mode in which such trust is to be discharged (ii) of any legal contract made touching the discharge of such trust. 10. To hold a person guilty of cheating it is necessary to show that he had fraudulent or dishonest intention at the time of making the promise. From his mere failure to keep up promise subsequently such a culpable intention right at the beginning, that is, when he made the promise cannot be presumed. 11. Coming to the facts on hand, 1st petitioner company paid consumption charges basing on the bills sent by the Central Power Distribution till June, 2003. When the Central Power Distribution sent the bills in the month of July, 2003 including wheeling charges, the dispute arose between the parties. In the circumstances, it cannot said that the petitioners-accused have dishonest intention when they made promise to pay the amount to the 3rd respondent as per the agreement between them. The dispute between the parties arose when the Central Power Distribution Company of A.P. demanded wheeling charges. This is purely a civil dispute, which is required to be adjudicated upon through process of Civil Courts or through the process of Arbitration as provided under clause 24 of the Agreement. In the facts and circumstances of the case, I am of the view that the continuance of criminal proceeding against the petitioners-accused amounts to abuse of process of law. 12.
In the facts and circumstances of the case, I am of the view that the continuance of criminal proceeding against the petitioners-accused amounts to abuse of process of law. 12. Accordingly, the Criminal Petitions are allowed and FIR in Crime No.6 of 2000 of Gooty police station registered for the offences under Sections 406 and 420 IPC is hereby quashed.