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Jharkhand High Court · body

2014 DIGILAW 721 (JHR)

Vimal Kumar Patni v. State of Jharkhand

2014-07-10

H.C.MISHRA

body2014
Order Heard learned counsel for the petitioner and learned counsel for the State as also learned counsel for the complainant-informant opposite party No.2. 2. The petitioner has filed this application for quashing the FIR, being Giridih (M) P.S. Case No.59 of 2013 corresponding to G.R. No.392 of 2013, which was instituted for the offence under Section 420 of the IPC. 3. The complaint case was filed in the Court of CJM, Giridih, by the opposite party No.2, in which the petitioner has been made accused, describing him as Director of Vikash Metal and Power Ltd. In the complaint petition, it is stated that the complainant is the Director of S.S. Raisers Pvt. Ltd. and there was business transaction between the complainant's Company and the petitioner's Company. It is stated that between the year 2007 to October 2010, the complainant’s Company had supplied the iron ore to the petitioner's Company, valued at Rs.7,78,29,802/-, but when the amount was not paid, one FIR was lodged against the accused petitioner, which was registered as Town P.S. Case No.249 of 2010, for the offence under Section 406, 420/34 of the IPC. It is stated that upon lodging of the said case, the accused became ready to make the payment of the amount and he issued four chequs of Rupees one crore each and also paid Rs.3,78,29,802/-in cash, where upon the said case was compromised. Subsequently, the complainant deposited one cheque of rupees one crore in the Bank, but the same was dishonoured. Upon notice, the accused assured to give another cheques, and upon the assurance of the accused, the complainant returned back all the four cheques of rupees one crore each. On 18.11.2012, the accused handed over one cheque of rupees fifty lakh bearing cheque No.000052 dated 15.12.2012 and assured that the same would be paid. Apart from that, 28 cheques for Rs.12, 50,000/-each, were also given for the rest amount. The said cheque of Rupees fifty lakh was deposited in the Bank on 15.12.2012, but the cheque was dishonoured. Alleging that the accused was having dishonest intention and thereby he cheated the complainant for the amount of rupees four crores, the complaint petition was filed. The said complaint was sent for institution of the police case, on the basis of which, Muffasil P.S. Case No.59 of 2013, was instituted for the offence under Section 420 of the IPC. Alleging that the accused was having dishonest intention and thereby he cheated the complainant for the amount of rupees four crores, the complaint petition was filed. The said complaint was sent for institution of the police case, on the basis of which, Muffasil P.S. Case No.59 of 2013, was instituted for the offence under Section 420 of the IPC. It is an admitted position that the case is still in the investigation stage. 4. Learned counsel for the petitioner has submitted that in the complaint petition, the petitioner is described as Director of Vikash Metal and Power Ltd, but the Company has not been made accused. It has been submitted by the learned counsel that whatever business transaction was there, it was between the complainant's Company and the petitioner's Company and in view of the fact that the cheque was issued by the petitioner being the Director of the Company, the offence, if any, was made out, against the Company and not against the petitioner, as in the Indian Penal Code, there is no provision for vicarious liability. Further, it is pointed out by the learned counsel for the petitioner that for the realisation of the dues between the parties, arbitration is going between them at Kolkata and whatever liability is there, it is of civil nature. Learned counsel submitted that the present case has been filed primarily for realisation of the money and accordingly, the offence under Section 420 of the IPC shall not be made out against the petitioner. 5. In this connection, learned counsel for the petitioner has relied upon the decision of the Hon'ble Supreme Court of India in GHCL Employees Stock Option Trust Vs. Kranti Sinha, reported in (2013) 4 SCC 505 , wherein the law has been laid down as follows:- “13. There is no dispute with regard to the legal proposition that the case of breach of trust or cheating are both a civil wrong and a criminal offence, but under certain situations where the act alleged would predominantly be a civil wrong, such an act does not constitute a criminal offence.” Placing reliance on this decision, learned counsel has submitted that the present case predominantly has been lodged for the realisation of money and the offence cannot be said to be constituted. 6. 6. Learned counsel has also drawn the attention of the Court towards the cheque issued by the petitioner, which has been brought on record, in order to show that the cheque has been signed by the petitioner for the Company and not in his personal capacity. Learned counsel has also placed reliance upon the decision of the Supreme Court in Maksud Saiyed Vs. State of Gujarat & Ors., reported in (2008) 5 SCC 668 , wherein the law is laid down as follows:- “13. Where a jurisdiction is exercised on a complaint petition filed in terms of Section 156(3) or Section 200 of the Code of Criminal Procedure, the Magistrate is required to apply his mind. The penal code does not contain any provision for attaching vicarious liability on the part of the Managing Director or the Directors of the Company when the accused is the Company. The learned Magistrate failed to pose unto himself the correct question viz. as to whether the complaint petition, even if given face value and taken to be correct in its entirety, would lead to the conclusion that the respondents herein were personally liable for any offence. The Bank is a body corporate. Vicarious liability of the Managing Director and Director would arise provided any provision exists in that behalf in the statute. Statutes indisputably must contain provision fixing such vicarious liabilities. Even for the said purpose, it is obligatory on the part of the complainant to make requisite allegations which would attract the provisions constituting vicarious liability.” (Emphasis supplied). Placing reliance on this decision, learned counsel has submitted that the petitioner cannot be held vicariously liable for the offence, if any, which has been committed by the Company, as there is no provision for any such liability in the Indian Penal Code. Further, in view of the fact that the present case has been instituted predominantly with the intention to realise the money from the Company, the criminal offence cannot be said to be made out. Learned counsel accordingly, submitted that it is a fit case for exercise the inherent power conferred under Section 482 of the Cr.P.C, for quashing the FIR in Giridih (M) P.S. Case No.59 of 2013 corresponding to G.R. No.392 of 2013. 7. Learned counsel accordingly, submitted that it is a fit case for exercise the inherent power conferred under Section 482 of the Cr.P.C, for quashing the FIR in Giridih (M) P.S. Case No.59 of 2013 corresponding to G.R. No.392 of 2013. 7. Per contra, learned counsel for the State as also learned counsel for the complainant opposite party No.2 have submitted that on the basis of allegations made in the complaint petition, the offence is clearly made out against the petitioner and accordingly, the FIR, or the criminal proceeding against the petitioner cannot be quashed. Learned counsel for the opposite party No.2 has also drawn the attention of this Court towards the complaint petition, wherein it is alleged that it was the petitioner, who assured the complainant that the cheque would be cleared and on his assurance, the four cheques of rupees one crore each were returned back and thereafter the cheque of rupees fifty lakhs was given to the complainant, which again was dishonoured upon depositing in the Bank. Learned counsel has also drawn the attention of this Court towards some documents brought on record through I.A. No.5146 of 2013, which has been filed for vacating the ad interim order passed in this case on 4.7.2013 in favour of the petitioner. From Annexure–B, it has been pointed out that there was an agreement between both the parties, first agreement was done on 11.7.2012 and upon the terms of the agreement, the complainant handed over the four cheques of rupees one crore each to the petitioner and again pursuant to the agreement dated 18.11.2012, the said cheques have been replaced by the petitioner by one cheque of rupees fifty lakhs dated 15.12.2012 and the balance amount of rupees three crore fifty lakhs was paid through 28 cheques of Rs. 12,50,000/-each. The attention of this Court has also been drawn by the learned counsel for the complainant opposite party No.2, towards Annexure-F, which is a letter written on 11.10.2012 by the petitioner to the complainant, wherein it was assured about the commitment to make the payments to the complainant. The attention of this Court has also been drawn to other letters also, which have been brought on record by the complainant in this regard. The attention of this Court has also been drawn to other letters also, which have been brought on record by the complainant in this regard. Learned counsel has accordingly, submitted that there is specific allegation against the petitioner only, to have cheated the complainant and accordingly, the offence under Section 420 of the IPC is clearly made out against the petitioner. Learned counsel has also placed reliance upon the decision of the Supreme Court of India in Indian Oil Corporation Vs. NECP India Ltd. & Ors., reported in (2006) 6 SCC 736 , wherein in a similar circumstance, it was held as follows:- “36. In this case, the complaints clearly allege that the accused with fraudulent intention to cheat and defraud IOC, had induced IOC to resume supply of aircraft fuel on cash-and-carry basis, by entering into a further agreement dated 20-9-1997 and undertaking to clear the outstanding amount of Rs. 18 crores approximately within the time stipulated in the hypothecation agreements. The sum and substance of the said allegation read with other averments extracted above, is that NEPC India, having committed default in paying the sum of Rs 18 crores, entered into a fresh agreement dated 20-9-1997 agreeing to clear the outstanding amount as per a fresh schedule, with the dishonest and fraudulent intention of pre-empting and avoiding any action by IOC in terms of the hypothecation deeds to take possession of the aircrafts. Though the supplies after 20-9-1997 were on cash-and-carry basis, the fraudulent intention is alleged to emanate from the promise under the said agreement to make payment, thereby preventing immediate seizure (taking possession) of the aircrafts by IOC. This allegation made in addition to the allegation relating to removal of engines, has been lost sight of by the High Court. All that is to be seen is whether the necessary allegations exist in the complaint to bring the case within Section 415. We are clearly of the view that the allegations in the complaint constitute such an offence. We are not concerned with the proof of such allegations or ultimate outcome of trial at this stage.” (Emphasis supplied). All that is to be seen is whether the necessary allegations exist in the complaint to bring the case within Section 415. We are clearly of the view that the allegations in the complaint constitute such an offence. We are not concerned with the proof of such allegations or ultimate outcome of trial at this stage.” (Emphasis supplied). Placing reliance on this decision, it has been submitted by the learned counsel for the complainant opposite party No.2 that all that is to be seen whether the necessary allegations exist in the complaint to bring the case within Section 415 of the IPC, and in view of the fact that the offence is constituted, the FIR cannot be quashed at this stage. 8. It has also been submitted by the learned counsel for the complainant opposite party No.2, that after the compromise arrived at between the parties and four cheques of Rupees one crore each were handed over to the complainant, the Bank account was closed no sooner the case was dropped on the basis of compromise, which also shows the intention of the petitioner. 9. After having heard learned counsels for both the sides and upon going through the record, as also the documents placed by the learned counsel for both the parties, I find that in the complaint petition, the petitioner has been made accused describing him as the Director of Vikash Metal and Power Ltd. The complaint, even shows that there was a business transaction between the complainant's Company and the petitioner's Company, in which from the year 2007 up to October 2010, the supply of iron ore were made by the complainant's Company to the petitioner's Company. As the amount of Rs.7,78,29,802/- was not paid by the petitioner's Company, the FIR was lodged, which was Town P.S. Case No.249 of 2010, for the same offence and there was compromise between the parties, in which four cheques of rupees one crore each was given to the complainant and cash of Rs.3,78,29,802/- was also paid. Though, it is alleged that the petitioner had assured for making the payment, but the cheque, was dishonoured on deposit in the Bank, but thereafter again the said cheques were replaced and the another cheque also got dishonoured. However, in paragraph 7 of the complaint petition, it is stated that the petitioner had fraudulently cheated the complainant's Company for Rupees four crores. However, in paragraph 7 of the complaint petition, it is stated that the petitioner had fraudulently cheated the complainant's Company for Rupees four crores. The plain reading of this complaint petition clearly shows that the first FIR, which was lodged against the petitioner, was compromised between the parties upon getting the four cheques of rupees one crore and cash of Rs.3,78,29,802/-. This clearly shows that the FIR was lodged predominantly for realising the money from the petitioner and once the cheques and cash were given, the case was compromised between the parties. Subsequently, though it is alleged that the petitioner again gave cheque of rupees fifty lakhs to complainant, which is said to be with the fraudulent intention, but the complaint has been filed with the allegation that complainant has been cheated for the balance of amount of rupees four crores. It also clearly shows that the complaint has predominantly been filed for realising rupees four crores, due for the business transaction between the complainant's Company and the petitioner's Company. This apart, the letter dated 11.10.2012, which has been relied upon by the learned counsel for the complainant and has been brought on record, on the basis of which it is submitted that the assurance was given by the petitioner to make the payments to the complainant, the relevant portion thereof reads as follows: “We would like to assure you that we are fully committed to make payments to you.” This clearly shows that the assurance, if any, was not in the personal capacity of the petitioner, rather the use of the word ‘We’, clearly shows that the assurance was on behalf of the Company. This letter also shows that M/s Vikash Metal and Power Ltd. had informed the complainant's Company that the Company was running in big loss and it was running through huge financial deficit, which clearly shows that there could not be any fraudulent intention to deceive the complainant from the very inception of the transaction, in as much as, the complainant was informed by the Company that it was under the financial difficulty. The decision relied upon by the learned counsel for the complainant opposite party No.2, in Indian Oil Corporation's case (supra), in my considered view, is not at all applicable to the facts of this case. The decision relied upon by the learned counsel for the complainant opposite party No.2, in Indian Oil Corporation's case (supra), in my considered view, is not at all applicable to the facts of this case. This apart, in the said case the Company was also made accused, but in the present case, the Company has not been made the accused. 10. From the aforementioned discussions, I find that whatever actions have been allegedly done by the petitioner, they were done on behalf of the Company and not in his personal capacity and accordingly, there being no provision for vicarious liability in the Indian Penal Code, the decision of the Hon'ble Supreme Court of India in Maksud Saiyed's case (supra), relied upon by the learned counsel for the petitioner, is fully applicable to the facts of this case. Even otherwise, from the allegations made against the petitioner in the complaint petition, it cannot be said that the petitioner was having the fraudulent intention to cheat the complainant from the very inception of the transaction, and in that view of the matter also, the offence under Section 420 of the IPC cannot be said to be made out. The FIR ex facie shows that this complaint was filed predominantly for realising of the money from the petitioner, and I find that the present case is fully covered by the decision of the Hon'ble Supreme Court of India in GHCL Employees Stock Option Trust's case (Supra), as well. 11. For the foregoing reasons, I am of the considered view that it is a fit case for exercising the inherent power under Section 482 of the Cr.P.C., for quashing the entire FIR against the petitioner. 12. Accordingly, the FIR, being Giridih (M) P.S. Case No.59 of 2013 corresponding to G.R. No.392 of 2013, is hereby, quashed. This application is accordingly, allowed. Consequently, the aforesaid I.A. also stands disposed of.