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2014 DIGILAW 820 (PAT)

Pawan Munjal v. State of Bihar

2014-07-31

ASHUTOSH KUMAR

body2014
ASHUTOSH KUMAR, J.:–Heard Mr. Amrendra Nath Verma, learned counsel for the petitioner and Mr. Jharkhani Updhayay, learned counsel for the State. 2. Despite service of notice on Opposite Party No. 2 on several occasions, nobody has appeared to contest on behalf of the Opposite Party No. 2. 3. That the petitioner is a Managing Director of Hero Honda Motors Ltd. He is being prosecuted at the instance of the complainant-opposite party No. 2 for the offence under Sections 406 and 420 of the Indian Penal Code. The complaint was lodged by Opposite Party No. 2 on 4th of January, 2005 alleging that he had purchased 50 shares of the company, of which the petitioner is the Managing Director, from the open market and required the same to be transferred in his name. That having not been done, despite his having purchased the shares in the year 1996, he launched the present prosecution by way of complaint. Learned Judicial Magistrate after examining the complainant on oath and on recording the statement of witnesses offered on behalf of the complainant, vide order dated 27th of October, 2006 took cognizance against the petitioner under Sections 406 and 420 of the Indian Penal Code. The aforesaid order is under challenge. 4. The petitioner submits that assuming but not admitting the fact that the share was not transferred in his name, no offence under Sections 406 or 420 can at all be said to have been made out. He further submits that non-transferring of the name of share certificate holder, attracts offence under Companies Act and not at all under the Indian Penal Code. It is further submitted on behalf of the petitioner that dissatisfied with the non-transfer of the share certificate in the name of complainant-opposite party no. 2, he preferred a title suit bearing Title Suit No. 82 of 1998, on 12th of June 2000, in which the petitioner was arraigned as one of the party-defendants. The complainant-opposite party no. 2 lost the aforesaid title suit and preferred a title appeal bearing Title Appeal No. 85 of 2000, which too was dismissed in due course. 5. Learned counsel for the petitioner submits that it is an illustrative case where the forum of criminal court has been permitted to be used to short-circuit a litigation, which primarily and dominantly has the flavor of civil dispute. 6. 5. Learned counsel for the petitioner submits that it is an illustrative case where the forum of criminal court has been permitted to be used to short-circuit a litigation, which primarily and dominantly has the flavor of civil dispute. 6. On perusing the complaint, deposition of witnesses and the order impugned, it appears that there has been a total non-application of mind on the part of the Court below in issuing process against the petitioner. Offence of cheating is defined under Section 415 of the Indian Penal Code and is punishable under Section 420 of the Indian Penal Code. The very ingredient for bringing home the charges under Section 415 of the Indian Penal Code is absent as cheating from the very inception appears to be sine-qua-non for bringing home the mischief of the section. Similarly for the offence of section 406 to have been attracted in the facts of the case, it was only necessary for the complainant-opposite party no. 2 to have established that the bonus shares or the dividends of the shares certificate of his, were converted to the own use or for wrongfully gain of the accused persons. This being completely absent in the complaint petition, no offence can at all be said to have been made out under Section 406 of the Indian Penal Code as well. 7. Having regard to the fact that the complainant-opposite party no. 2 has lost in the civil litigation till the appellate stage and the absence of the ingredients of the offence for which the petitioner is being charged in the complaint petition and the attending papers, this Court is inclined to set aside the order of cognizance. 8. In view of the aforesaid reasons, the order taking cognizance is held to be bad; sans application of mind. The order impugned, thus, is quashed. 9. The application is allowed. ?