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Madhya Pradesh High Court · body

2017 DIGILAW 1055 (MP)

Akhilesh Uprit v. Pramod Kumar Pathak

2017-10-05

S.K.GANGELE

body2017
ORDER : S.K. Gangele, J. These two petitions have been filed against common orders. They tagged together and heard together and are being decided by this common order. 2. Petitioners have filed this petition under Section 482 of Cr.P.C. against the order dated 14.03.2014 passed by XV Additional Sessions Judge, Bhopal in Criminal Revision No.480/2013 whereby the revisional Court rejected the revision petition filed by the petitioners against the order dated 16.7.2013 passed by the Judicial Magistrate First Class, Bhopal in Complaint Case No.5936/2013 by which the Court has taken cognizance against the petitioners for commission of offence punishable under Section 420 of IPC. 3. Respondent had filed a complaint against the petitioners. He pleaded that the petitioners induced him to enter into an agreement in regard to purchase of the land area 11.50 acres, although firm was not the owner of the land. The ownership of the land was with Riddhi Siddhi Builders and Developers. Respondent issued a cheque of Rs. 4,67,50,000/- in favour of the petitioners. Hence the petitioners played fraud with the respondent. 4. The trial Court after perusal of the statement of the respondent has held that there is prima-facie evidence against the petitioners for commission of offence punishable under Section 420 of IPC. It is also a fact that the petitioners firm filed a private complaint against the respondent under Section 138 of Negotiable Instruments Act because cheque was bounced. Against the order of trial Court a revision was filed which was also dismissed. 5. On 20.12.2010 an agreement was entered into between Riddhi Siddhi Builders and Madhuvan Greens for purchase of the land in question in total consideration of Rs. 3,00,00,000/- (Rs. Three crores), out of aforesaid amount complainant Madhuvan Greens paid an amount of Rs. 1,20,00,000/- to Riddhi Siddhi Builders. 6. As per Clause 7 of aforesaid agreement, Madhuvan Green's was authorised to execute the agreement with third party in regard to sale of the land. However, it is mentioned in the Clause that Madhuvan Greens was not eligible to execute sale deed of the land until and unless M/s. Riddhi Siddhi Builders would receive the amount as mentioned in the agreement. 7. On 10.5.2011, an agreement was entered into between Madhuvan Greens, complainant and petitioner Pramod Kumar Pathak. By the aforesaid agreement Madhuvan Greens had agreed to sale the land in question in favour of Mr. 7. On 10.5.2011, an agreement was entered into between Madhuvan Greens, complainant and petitioner Pramod Kumar Pathak. By the aforesaid agreement Madhuvan Greens had agreed to sale the land in question in favour of Mr. Pramod Kumar Pathak in total consideration of Rs. 5,17,50,000/-. It is mentioned in the agreement that Rs. 5,00,000/- were paid in cash on 10.5.2011 by Mr. Pramod Kumar Pathak to Madhuvan Greens and remaining amount shall be paid in instalments : dz0 /kujkf'k :i;s vnk djus dh fnuakd 1 45]00]000@& vuqca/k fnuakd ls 10&15 fnol esaA 2 50]00]000@& fnuakd 30-06-2011 rd vnk fd;k tkosxkA 3 1]00]00]000@& fnuakd 30-09-2011 rd vnk fd;k tkosxkA 4 50]00]000@& fnuakd 30-10-2011 rd vnk fd;k tkosxkA 5 2]67]50]000@& fnuakd 15-03-2012 rd vnk fd;k tkosxkA 5]12]50]000@& dqy :Ik;s 8. In accordance with the agreement executed between Riddhi Siddhi Builders, respondent Pramod Kumar Pathak and Madhuvan Greens, Riddhi Siddhi Builders had executed a Power of Attorney in favour of Pramod Kumar Pathak with the consent of complainant Madhuvan Greens and in accordance with aforesaid agreement the petitioner had agreed to pay the amount, which would be payable by Madhuvan Greens to Riddhi Siddhi Builders and an amount of Rs. 1,80,00,000/- to the complainant. It is mentioned that Rs. 60,00,000/- was paid in cash, while an amount of Rs. 60,00,0000/- would be payable by cheque No.023262 dated 31.12.2011 and another amount of Rs. 50,00,000/- would be payable by cheque No.023623 by the petitioners. It is further mentioned in the agreement that the petitioners could execute a sale deed up to 15.1.2012 or earlier to aforesaid date after paying the amount or petitioners can also become owner of Riddhi Siddhi firm and the agreement would be deemed to be non-est after 15.1.2012, if the parties would not follow the terms and conditions of the agreement. Subsequently, Riddhi Siddhi Builders executed a sale deed in favour of the petitioners for the land in question. 9. Thereafter on 15.8.2012, it is alleged that the petitioners issued a cheque in favour of Madhuvan Greens for the sum of Rs. 4,67,50,000/-, which was dishonoured on 17.10.2012, in-spite notice petitioners did not pay the amount nor honoured the cheque. 10. Subsequently, Riddhi Siddhi Builders executed a sale deed in favour of the petitioners for the land in question. 9. Thereafter on 15.8.2012, it is alleged that the petitioners issued a cheque in favour of Madhuvan Greens for the sum of Rs. 4,67,50,000/-, which was dishonoured on 17.10.2012, in-spite notice petitioners did not pay the amount nor honoured the cheque. 10. From the aforesaid facts, it is clear that an agreement was entered initially between Riddhi Siddhi Builders and Madhuvan Greens-the partnership firm and the petitioners were partners of the aforesaid firm and Riddhi Siddhi Builders agreed to sale the land in question to Madhuvan Greens on a consideration of Rs. 3,00,00,000/- (Three Crores). Clause-7 of the agreement authorised Madhuvan Greens to execute the agreement with third party in regard to sale of the land. Thereafter, another agreement was executed on 10.5.2011 between Madhuvan Greens, respondent and Riddhi Siddhi Builders. In the aforesaid agreement, it is mentioned that Riddhi Siddhi Builder shall execute Power of Attorney in favour of the respondent to sale the land. Thereafter, Power of Attorney was executed in favour of the respondent by Riddhi Siddhi Builders. The respondent had also agreed that he would share the liability of Madhuvan Greens which was accrued in favour of Riddhi Siddhi Builders because of execution of earlier agreement and thereafter on 15.8.2012 the respondent issued a cheque of Rs. 1,80,00,000/-. It is also a fact that Riddhi Siddhi Builders executed sale deed in favour of the respondent and respondent got right of ownership of the land. 11. It is a fact that the petitioners were legally not authorised to sale the land. However, they had executed an agreement on the basis of the agreement executed between Riddhi Siddhi Builders and Madhuvan Greens. Subsequently, another agreement was executed between Riddhi Siddhi Builders, Madhuvan Greens and the respondent and thereafter the respondent had purchased the land from Riddhi Siddhi Builders. In third agreement the respondent himself is admitted that Madhuvan Greens is one of the party in execution of agreement and thereafter he had issued a cheque. In such circumstances, it cannot be said that petitioners played fraud with the respondent. 12. In third agreement the respondent himself is admitted that Madhuvan Greens is one of the party in execution of agreement and thereafter he had issued a cheque. In such circumstances, it cannot be said that petitioners played fraud with the respondent. 12. Section 420 of IPC reads as under : “Whoever cheats and thereby dishonestly induces the person deceived any property to any person, or to make, alter or destroy the whole or any part of a valuable security, or anything which is signed or sealed, and which is capable of being converted into a valuable security, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine.” 13. The Supreme Court after considering earlier judgments in regard to quashment of criminal proceedings, if alleged transaction is commercial in nature has held as under in the matter of Indian Oil Corporation v. NEPC India Ltd and others reported in (2006) 6 SCC 736 : “12. The principles relating to exercise of jurisdiction under Section 482 of the Code of Criminal Procedure to quash complaints and criminal proceedings have been stated and reiterated by this Court in several decisions. To mention a few - Madhavrao Jiwaji Rao Scindia v. Sambhajirao Chandrojirao Angre [ 1988 (1) SCC 692 ], State of Haryana v. Bhajanlal [1992 Supp (1) SCC 335], Rupan Deol Bajaj v. Kanwar Pal Singh Gill [ 1995 (6) SCC 194 ], Central Bureau of Investigation v. Duncans Agro Industries Ltd., [ 1996 (5) SCC 591 ], State of Bihar v. Rajendra Agrawalla [ 1996 (8) SCC 164 ], Rajesh Bajaj v. State NCT of Delhi, [ 1999 (3) SCC 259 ], Medchl Chemicals & Pharma (P) Ltd. v. Biological E. Ltd. [ 2000 (3) SCC 269 ], Hridaya Ranjan Prasad Verma v. State of Bihar [ 2000 (4) SCC 168 ], M. Krishnan v. Vijay Kumar [ 2001 (8) SCC 645 ], and Zandu Phamaceutical Works Ltd. v. Mohd. Sharaful Haque [ 2005 (1) SCC 122 ]. The principles, relevant to our purpose are : (i) A complaint can be quashed where the allegations made in the complaint, even if they are taken at their face value and accepted in their entirety, do not prima facie constitute any offence or make out the case alleged against the accused. Sharaful Haque [ 2005 (1) SCC 122 ]. The principles, relevant to our purpose are : (i) A complaint can be quashed where the allegations made in the complaint, even if they are taken at their face value and accepted in their entirety, do not prima facie constitute any offence or make out the case alleged against the accused. For this purpose, the complaint has to be examined as a whole, but without examining the merits of the allegations. Neither a detailed inquiry nor a meticulous analysis of the material nor an assessment of the reliability or genuineness of the allegations in the complaint, is warranted while examining prayer for quashing of a complaint. (ii) A complaint may also be quashed where it is a clear abuse of the process of the court, as when the criminal proceeding is found to have been initiated with mala fides/malice for wreaking vengeance or to cause harm, or where the allegations are absurd and inherently improbable. (iii) The power to quash shall not, however, be used to stifle or scuttle a legitimate prosecution. The power should be used sparingly and with abundant caution. (iv) The complaint is not required to verbatim reproduce the legal ingredients of the offence alleged. If the necessary factual foundation is laid in the complaint, merely on the ground that a few ingredients have not been stated in detail, the proceedings should not be quashed. Quashing of the complaint is warranted only where the complaint is so bereft of even the basic facts which are absolutely necessary for making out the offence. (v) A given set of facts may make out : (a) purely a civil wrong; or (b) purely a criminal offence; or (c) a civil wrong as also a criminal offence. A commercial transaction or a contractual dispute, apart from furnishing a cause of action for seeking remedy in civil law, may also involve a criminal offence. As the nature and scope of a civil proceedings are different from a criminal proceeding, the mere fact that the complaint relates to a commercial transaction or breach of contract, for which a civil remedy is available or has been availed, is not by itself a ground to quash the criminal proceedings. The test is whether the allegations in the complaint disclose a criminal offence or not. 13. The test is whether the allegations in the complaint disclose a criminal offence or not. 13. While on this issue, it is necessary to take notice of a growing tendency in business circles to convert purely civil disputes into criminal cases. This is obviously on account of a prevalent impression that civil law remedies are time consuming and do not adequately protect the interests of lenders/creditors. Such a tendency is seen in several family disputes also, leading to irretrievable break down of marriages/families. There is also an impression that if a person could somehow be entangled in a criminal prosecution, there is a likelihood of imminent settlement. Any effort to settle civil disputes and claims, which do not involve any criminal offence, by applying pressure though criminal prosecution should be deprecated and discouraged. In G. Sagar Suri v. State of UP [ 2000 (2) SCC 636 ], this Court observed : “It is to be seen if a matter, which is essentially of civil nature, has been given a cloak of criminal offence. Criminal proceedings are not a short cut of other remedies available in law. Before issuing process a criminal court has to exercise a great deal of caution. For the accused it is a serious matter. This Court has laid certain principles on the basis of which High Court is to exercise its jurisdiction under Section 482 of the Code. Jurisdiction under this Section has to be exercised to prevent abuse of the process of any court or otherwise to secure the ends of justice.” 14. While no one with a legitimate cause or grievance should be prevented from seeking remedies available in criminal law, a complainant who initiates or persists with a prosecution, being fully aware that the criminal proceedings are unwarranted and his remedy lies only in civil law, should himself be made accountable, at the end of such misconceived criminal proceedings, in accordance with law. One positive step that can be taken by the courts, to curb unnecessary prosecutions and harassment of innocent parties, is to exercise their power under section 250 Cr.P.C. more frequently, where they discern malice or frivolousness or ulterior motives on the part of the complainant. Be that as it may. 14. One positive step that can be taken by the courts, to curb unnecessary prosecutions and harassment of innocent parties, is to exercise their power under section 250 Cr.P.C. more frequently, where they discern malice or frivolousness or ulterior motives on the part of the complainant. Be that as it may. 14. In the present case the contention of the respondent is that the petitioners induced him to enter into an agreement to purchase the land which was not the ownership of firm Madhuvan Greens and the owner of the land was Riddhi Siddhi Builder and Developers. However, respondent himself entered into another contract with Madhuvan Greens, Riddhi Siddhi Builders and respondent and they had agreed to incurred the liability of Riddhi Siddhi Builders and subsequently Riddhi siddhi Builders executed sale deed of land in question in favour of the respondent and he got right of ownership of the land. In such circumstances, it cannot be said that the petitioners have cheated the respondent. After second agreement the nature of transaction has been changed. 15. In this view of the matter, in my opinion, the petitioners have not committed any criminal act and they cannot be prosecuted for alleged criminal act punishable under Section 420 of IPC. The trial Court and revisional Court overlooked the aforesaid provisions. Consequently, this petition is allowed, registration of criminal offence against the petitioners is hereby quashed. Private complaint filed by the respondent is hereby dismissed. It is hereby clarified that the observations made in this order by this Court would not affect civil rights of the parties in any manner. 16. Petition is allowed, as indicated above.