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2008 DIGILAW 393 (UTT)

BASUDEV GARG v. STATE OF UTTARAKHAND

2008-08-28

V.K.GUPTA

body2008
JUDGMENT In this criminal writ petition filed under Article 226 of the Constitution of India, the First Information Report lodged on 13.05.2008 in Police Station Bhagwanpur, District Haridwar U/Ss 406/420 I.P.C. has been challenged and it is prayed that this F.I.R. and a proceedings emanating there from be quashed and set aside. 2. I have heard the learned counsel for the parties and have perused the record of the case including the First Information Report in question. 3. A bare perused of the First Information Report clearly reveals to me that respondent no. 4 – M/s Paswara Electronics Pvt. Ltd. had entered into an agreement with KMG International Ltd. On 19.10.2007, whereby KMG International Ltd. was to supply the raw material, M/s Paswara Electronics Pvt. Ltd. would manufacture CFL and deliver the end products to KMG International Ltd. for marketing. In the First Information Report, the allegation is that M/s Paswara Electronics Pvt. Ltd. – respondent no. 4 delivered CFL (end product) to KMG International Ltd., but despite taking the delivery of the product, the price thereof was not paid to the Manufacturer. In the First Information Report, it was accordingly claimed that a sum of Rs. 21,20,660/- was due from M/s KMG International towards respondent no. 4. The First Information Report also alleged that for enabling KMG International to purchase raw material, respondent no. 4 had given some blank cheques, but despite filling-pin and encashing those blank cheques and making payments to some raw material supplies, respondent no. 4 had not received the raw material. 4. After a careful perusal of the First Information Report in question and upon hearing the learned counsel for the parties, this Court is firmly of the considered opinion that the First Information Report does not at all reveal or suggest the commission of any offence by the petitioners, who are stated to the Directors of KMG International Ltd. Actually, the First Information Report does not reveal or suggest the commission of any offence by anyone. The entire First Information Report is based upon a civil transaction and as per the allegations in the First Information, disputes purely of civil nature have been alleged to be existing between the parties. 5. Mr. Harish Pujari, the learned Additional Government Advocate and Mr. Rajeev Sharma, learned Advocate appearing for respondent no. The entire First Information Report is based upon a civil transaction and as per the allegations in the First Information, disputes purely of civil nature have been alleged to be existing between the parties. 5. Mr. Harish Pujari, the learned Additional Government Advocate and Mr. Rajeev Sharma, learned Advocate appearing for respondent no. 4 have very fairly and frankly also conceded before me that, indeed, the First Information does not disclose or suggest the commission of any offence by anyone, much less by the petitioner and the First Information, if at all, discloses the existence of disputes of pure civil nature relating to and arising out of an agreement between the parties, namely, respondent no. 4 – M/s Paswara Electronics Pvt. Ltd. and KMG International Ltd. 6. Counter affidavit has been filed on behalf of respondents 1 to 3 by Sri Raghubeer Singh Aswal, Inspector, C.B.C.I.D., Dehradun. Separate counter affidavit has been filed on behalf of respondent no. 4 by Sri Ajay Mathur, who claims to be the General Manager of respondent no. 4. 7. Whereas the averments made in the counter affidavit of respondent no. 4 are understandable being in the nature of a contest between the petitioners and respondent no. 4, the affidavit filed on behalf of respondents 1 to 3 very painfully and unfortunately, reveals that respondents 1 to 3 went whole hearted into the investigation of the case after registration of the First Information and have defended their action by claiming as if offences in fact have been committed by the petitioners. It is a very unfortunate case where the State Police has allowed itself to be used as a tool of someone, who lodged the First Information despite the fact that the First Information on its plain reading as well as upon deeper introspection did not reveal or suggest the commission of any offences. Anyone who would care to read the First Information would find that a dispute purely of a civil nature was made the subject-matter of the First Information and yet the Police allowed itself to be used as a tool for setting into motion the machinery of Criminal Justice System only for the purpose of harassing the petitioners. Even in the past, I have come across a few other cases, in fact, a large number of them, where similar F.I.Rs. Even in the past, I have come across a few other cases, in fact, a large number of them, where similar F.I.Rs. have been lodged by unscrupulous persons with respect to the disputes of purely civil nature and the Police machinery not only registered the F.I.Rs. but also set into motion comprehensive investigation, thus misusing the machinery of Criminal Justice System. This Court does wish to impress upon the police machinery in the State the imperative and inevitable importance of not allowing machinery of Criminal Justice System to be misused in such cases which are purely of civil nature. 8. A copy of this judgment shall be sent to the Director General of Police, Uttarakhand with direction to him to take all appropriate steps in the aforesaid direction in the light of the observations made hereinabove. 9. As this judgment was being dictated, learned counsel for the petitioners Mr. V.K. Kohli, Senior Advocate and learned counsel for respondent no. 4 Mr. Rajeev Sharma, Advocate submitted that their clients have now come to terms and in view of the fact that an Arbitration Agreement already exists between M/s Paswara Electronics Pvt. Ltd. And KMG international Ltd., clause 11 of that agreement being the arbitration clause, these parties have now decided to get all their disputes adjudicated through arbitration and they have both accordingly submitted and requested me for exercising my jurisdiction U/s 11(6) of Arbitration and Conciliation Act, 1996 to appoint a Single Member Arbitral Tribunal to whom all the disputes between the parties relating to and arising out of the aforesaid agreement may be referred for adjudication through arbitration. They have also suggested to me that in view of this agreement, the First Information Report in question may also be quashed. 10. Based upon the aforesaid reasoning, the First Information Report is hereby quashed with all the consequences. Resultantly, and action taken pursuant to the First Information Report is also quashed and set aside. 11. Based upon the aforesaid agreement between the parties and with their consent, Sri Justice O.P. Garg (Retd.), a former Judge of Allahabad High Court (Tel. Nos. 0120-2501100 and 09818274126) is hereby appointed as a Single Member Arbitral Tribunal in terms of Clause 11 of the agreement dated 19.10.2007 executed between M/s Paswara Electronics Pvt. Ltd. and KMG International Ltd. 12. Based upon the aforesaid agreement between the parties and with their consent, Sri Justice O.P. Garg (Retd.), a former Judge of Allahabad High Court (Tel. Nos. 0120-2501100 and 09818274126) is hereby appointed as a Single Member Arbitral Tribunal in terms of Clause 11 of the agreement dated 19.10.2007 executed between M/s Paswara Electronics Pvt. Ltd. and KMG International Ltd. 12. Learned Sole Arbitrator shall enter upon the reference immediately, proceed to conduct the arbitration proceedings and pass the Arbitral Award at his immediate convenience. He shall adjudicate upon all the disputes between the parties. The parties, including KMG International Ltd. and respondent no. 4 are at liberty to file their claims/counter claims before the learned Arbitrator. The venue of the arbitration proceedings, as agreed to between the parties, shall be either Delhi or NOIDA. 13. The petition is allowed. No order as to costs.