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2013 DIGILAW 134 (CAL)

In the matter of : MMTC Ltd. v. .

2013-03-06

KANWALJIT SINGH AHLUWALIA

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JUDGMENT : Kanwaljit Singh Ahluwalia, J. The present case is an example where provisions of criminal law are being misused and abused for settlement of a civil dispute. 2. True it is that final outcome in civil proceedings allude the rightful claimant, as civil proceedings have become tardy, lengthy and time consuming. Merely because grievances cannot be redressed in a civil proceeding, shall give right to nobody to invoke provisions of criminal law for settlement of the commercial disputes. 3. Petitioner no. 1, MMTC Ltd. is a Government of India Undertaking, petitioner no. 2 to 7 are Directors and employees of the said Government of India Undertaking. 4. The complainant herein is an Importer & Exporter of commodities. It is stated in para 3 of the impugned complaint that complainant company is engaged in the business of import and exports of various food grains. It is further stated that petitioner no. 1, MMTC Ltd. is a Government of India Undertaking, engaged in the business of import export of food grains and other items. It also import various items for other business concerns in India. 5. In para 6 of the complaint it is stated that on 10th August, 2009 a sale agreement was entered between the complainant and petitioner no. 1 and in pursuance thereof MMTC Ltd. was to import 7500 M. Ton of Thailand White Refined Sugar. 6. The grievance made by the complainant as stated in para 6 of the complaint, which reads as under :- "That on or about 10th August, 2009 an Sale Agreement was entered by and between the complainant and MMTC Ltd. being No. MMTC/KOL/AGRO/SUGAR/SS (09)/2009-10 dated 10.08.2009 whereby MMTC Ltd. was to import 7500 M. Ton (+/- 10%) of Thailand White Refined Sugar and to sell the same to the complainant, a quantity of 7000 M. Ton was imported in line with the terms of the Sale Agreement and all the cargo was taken delivery by the complainant company upon payment to accused no. 1 in full and final settlement. It is pertinent to mention that accused no. 1 neither quoted any VAT nor have charged any VAT in the sale invoices, accordingly the complainant company have not charged any VAT on the sale effected by them and have not collected any VAT from the ultimate purchasers." 7. 1 in full and final settlement. It is pertinent to mention that accused no. 1 neither quoted any VAT nor have charged any VAT in the sale invoices, accordingly the complainant company have not charged any VAT on the sale effected by them and have not collected any VAT from the ultimate purchasers." 7. It was further stated that complainant had deposited Rs.30,00,000/- (Thirty lakhs) in favour of MMTC Ltd, a Government of India establishment, as a security and that cheque has been encashed by a Government Organisation towards payment of VAT. 8. Mr. Sudipta Maitra appearing for the complainant had stated that petitioners accused were not entitled to encash the cheque towards payment of VAT and furthermore since they have encashed the cheque without the knowledge of the complainant, it amounts an offence of cheating/misappropriation. 9. Apparently at most there is breach of an agreement. Petitioners company and the complainant were engaged in a commercial transaction; whether complainant is liable to pay VAT or not is a civil dispute. Complainant could have filed a civil suit for refund of the VAT amount charged by the petitioners company. It cannot be said that encashment of cheque towards payment of VAT will amount to offence of misappropriation or criminal breach of trust or cheating. There may be misunderstanding or difference of opinion so far interpretation of terms of agreement are concerned; but the same will not attribute mens rea to official of Government Organisation or petitioner no. 1 that they intended to cheat the complainant or they intended to criminally misappropriate funds. Mens rea is essential ingredient, which is lacking in this case, therefore, civil dispute cannot be clothed by giving criminal cover. 10. In view of the above the present revision petition is accepted, impugned complaint along with all subsequent proceedings is quashed.