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2017 DIGILAW 1477 (PAT)

Md. Shahbaz Siddique v. State of Bihar

2017-11-16

ARUN KUMAR

body2017
ARUN KUMAR, J.:–Heard learned counsel for the petitioner, learned counsel for the State and learned counsel appearing on behalf of the O.P. No. 2. 2. Petitioner seeks quashing of the cognizance order dated 13.06.2008 passed by the learned Judicial Magistrate, 1st Class, Araria in Complaint Case No. 565C of 2008 thereby taking cognizance of offence under Sections 406 and 420 of the Indian Penal Code. 3. Complainant-O.P. No. 2 filed a complaint stating that in the year 2003, accused-petitioner having licence of export approached him to supply him foodgrains for exporting to Bangladesh, as he deals in purchase and sale of foodgrains. Issue of H.Form was raised by the complainant then accused-petitioner assured that he would make the payment regularly after receiving each consignment and before final settlement of the account, H.Form would be handed over to him. Complainant used to send foodgrains to the destination mentioned by the accused petitioner from the period 23.09.2003 to 10.03.2005. Petitioner also made payment by various cheques with regard to price of the foodgrains being supplied regularly, but he did not make payment with respect to some amount. It is alleged by complainant that foodgrains worth Rs. 4,77,87,932/- was supplied to the accused, but he made payment only to the tune of Rs. 4,25,71,600/-, so payment of remaining amount of Rs. 52,16,332/- and H.Form were not given by accused despite persuasion made several times by the complainant. So, accused-petitioner used to evade to making such payment till the period 2006-07 so ultimately, he filed this case for realizing the remaining amount and also H.Form claim of Rs. 3,82,334/-. 4. Learned counsel for the petitioner submits that there was an oral agreement between two for purchase and sale of foodgrains, petitioner was having export licence for exporting foodgrains to Bangladesh entered into oral contract with the complainant to supply him foodgrains; so for over a period of two years, in several transactions, foodgrains were supplied by the complainant and petitioner used to make payment regularly so he has made all payments to the complainant but dispute is raised by the complainant that instead of Rs. 4,77,87,932/-, total amount of the foodgrains supplied by him, petitioner has paid only Rs. 4,25,71,600/-, so there was short of Rs. 52,16,332/- and odd amount. 4,77,87,932/-, total amount of the foodgrains supplied by him, petitioner has paid only Rs. 4,25,71,600/-, so there was short of Rs. 52,16,332/- and odd amount. He has further submitted that there is no any oral agreement for giving H.Form because he paid the price of supplied foodgrains inclusive of the tax amount to the complainant. 5. Learned counsel further submits that there is no ingredient of both offences, under Sections 406 and 420 of I.P.C., are made out in which cognizance has been taken, there is complete absence of the fact relating to entrustment of any property, as foodgrains were supplied not once, but for over a period of time and he used to regularly make payments by cheques, as this fact is also disclosed from the contents of complaint petition itself. So there is no any entrustment rather as per agreement, there was a business deal between both sides and only dispute is being raised that he has paid lesser amount though dispute is of accounting. Learned counsel has further submitted that in order to draw the ingredients under Section 420 of I.P.C., there must be element of deception present right since inception means at the beginning, but it is not the case that he was not making payment i.e., the price of the foodgrains to the complainant; so in the present case civil dispute is being given a clock of criminal case. Learned counsel has placed reliance on a number of decisions of Hon’ble Supreme Court in the case of Rama Devi Vs. State of Bihar & Ors. reported in (2010) 12 SCC 273 ; of Binod Kumar & Ors. Vs. State of Bihar & Anr. reported in (2014) 10 SCC 663 ; of Vesa Holdings Private Limited & Anr. Vs. State of Kerala & Ors. reported in (2015) 8 SCC 293 and of Robert John D’souza & Ors. Vs. Stephen V.Gomes & Anr. reported in (2015) 9 SCC 96 , in support of his contention. 6. Contrary to this, learned counsel appearing on behalf of the O.P. No. 2, complainant, submits that taking his confidence, petitioner has cheated him and also made breach of trust for the reason that he has promised to give H.Form at the very beginning by the oral agreement, but it was not submitted even after completion of the whole transaction. Moreover, he was also not paid Rs. Moreover, he was also not paid Rs. 52,16,332/- approximately, the amount due to him, so the ingredients of both offences are being made out in the present facts of the case. 7. Having considered rival submissions and on perusal of record, let us first examine the allegation levelled in the complaint by the complainant against the petitioner. Allegation is that both sides entered into an oral agreement accordingly the complainant was to supply foodgrains to the petitioner on periodic intervals and in lieu thereof, he has to make payment. It is also alleged that he would also give H.Form, which is a sale tax return, relating to the transaction of sale and purchase. The foodgrains was supplied by the complainant to the petitioner for a period of approximately one and half year precisely from 23.09.2003 to 10.03.2005 and it is also stated in the complaint that in total, petitioner paid Rs. 4,2,571,600/-, as price money of the foodgrains, but according to the complainant, total amount of the foodgrains supplied by him to the petitioner is worth Rs. 4,77,87,932/- and he also not submitted H.Form, so he will have to incur tax liability approximately to the tune of Rs. 3,82,334/-. So whether in the backdrop of the facts, ingredients of Sections 406 and 420 of I.P.C. are made out or not? 8. First of all, I examine the offence of criminal breach of trust, as defined under Section 405 of I.P.C., which reads as such:— “405. Criminal breach of trust.— Whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied, which he has made touching the discharge of such trust, or willfully suffers any other person so to do, commits “criminal breach of trust”. 9. In order to constitute offence of “criminal breach of trust”, following ingredients are to be found: First, entrusting a person with property or with any dominion over property. 9. In order to constitute offence of “criminal breach of trust”, following ingredients are to be found: First, entrusting a person with property or with any dominion over property. Second, that person entrusted with the property dishonestly misappropriates or converts the same to his own use or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged or of any legal contract, express or implied, which he has made touching the discharge of such trust. Whereas Section 420 of I.P.C. reads as follows:— “420. Cheating and dishonestly inducing delivery of property.—Whoever cheats and thereby dishonestly induces the person deceived to deliver 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.” 10. In the present case, there is no any written agreement between the parties. It is alleged by the complainant that there was an oral agreement and the agreement was to supply foodgrains to him and the petitioner, being exporter, used to export the foodgrains to Bangladesh and other country. The whole transaction of supplying the foodgrains was done by the complainant from 23.09.2003 to 10.03.2005. It is also stated in the complaint that petitioner also used to make payment invariably against supply of foodgrains, so the dispute arose only after completion of the agreement after completion of entire transaction over a period of time. At the end of transaction the complainant alleges that the petitioner has paid in lesser amount, as the complainant supplied foodgrains over these periods of worth Rs. 4,77,87,932/- whereas petitioner has made payment only to the tune of Rs. 4,25,71,600/-. So it was a business transaction as per oral agreement and there was no entrustment of the foodgrains to the accused, as it is a case of sale and purchase. Only dispute appears on accounting between the two after completion of transaction. 11. The issue of H. Form relating to sale tax liability that has to be decided by the concerned department fixing the liability to the concerned person for making payment. Only dispute appears on accounting between the two after completion of transaction. 11. The issue of H. Form relating to sale tax liability that has to be decided by the concerned department fixing the liability to the concerned person for making payment. So in the backdrop of the facts of the present case, the Court does not find any element of deception at the initial stage of the oral agreement. In the case of Binod Kumar (supra), the dispute arose out of a contract for the construction of college building. According to the contractor, instead of payment of Rs. 34,505/-, only Rs. 14,000/- was paid by the college, so a complaint case was filed alleging criminal breach of trust. In the backdrop of such fact, the Apex Court discussing the ingredients of both offences, held as such:— “18. In the present case, looking at the allegations in the complaint on the face of it, we find that no allegations are made attracting the ingredients of Section 405 IPC. Likewise, there are no allegations as to cheating or the dishonest intention of the appellants in retaining the money in order to have wrongful gain to themselves or causing wrongful loss to the complainant. Excepting the bald allegations that the appellants did not make payment to the second respondent and that the appellants utilized the amounts either by themselves or for some other work, there is no iota of allegation as to the dishonest intention in misappropriating the property. To make out a case of criminal breach of trust, it is not sufficient to show that money has been retained by the appellants. It must also be shown that the appellants dishonestly disposed of the same in some way or dishonestly retained the same. The mere fact that the appellants did not pay the money to the complainant does not amount to criminal breach of trust. 19. Even if all the allegations in the complaint taken at the face value are true, in our view, the basic essential ingredients of dishonest misappropriation and cheating are missing. Criminal proceedings are not a shortcut for other remedies. Since no case of criminal breach of trust or dishonest intention of inducement is made out and the essential ingredients of Sections 405/420 IPC are missing, the prosecution of the appellants under Sections 406/120-B IPC, is liable to be quashed.” 12. Criminal proceedings are not a shortcut for other remedies. Since no case of criminal breach of trust or dishonest intention of inducement is made out and the essential ingredients of Sections 405/420 IPC are missing, the prosecution of the appellants under Sections 406/120-B IPC, is liable to be quashed.” 12. So applying the same principles in the facts of the present case, the Court is of the view that even if entire allegations made in the complaint is taken into entirety, on its face value, the basic ingredients of dishonest misappropriation and cheating are missing. The dispute in the present case is of civil nature, which may be decided in a civil suit but in order to settle the civil dispute in the garb of launching a criminal prosecution amounts to misuse of the process of court, so the principles relating to exercise of jurisdiction under Section 482 Cr.P.C., several decisions of the Apex Court are quoted in para-10 of the case of Binod Kumar (supra), which is as follows:— “10. In Indian Oil Corpn. VS. NEPC India Ltd.; (2006) 6 SCC 736 , this Court ahs summarized the principles relating to exercise of jurisdiction under Section 482CrPC to quash complaints and criminal proceedings as under: “12. The principles relating to exercise of jurisdiction under Section 482 of the Code of Criminal Procedure to quash complaints and criminal proceeding have been stated and reiterated by this Court in several decisions. To monition a few –Madhavrao Jiwajirao Scindia Vs. Sambhajirao Chandraojirao Angre; (1998) 1 SCC 692, State of Haryana vs. Bhajan Lal; 1992Supp(1)SCC 335, Rupan Deol Bajaj Vs. Kanwar Pal Singh Gill; (1995) 6 SCC194, CBI VS.Duncans Agro Industries Ltd.; (1996) 6 SCC 591, State of Bihar Vs. Rajendra Agrawalla; (1996)8SCC 164, Rajesh Bajaj Vs. State (NCT of Delhi; (1999) 3 SCC 259 , Medchl Chemicals & Pharma (P) Ltd. Vs. Biological E.Ltd.; (2000) 3 SCC 269 , Hridaya Ranjan Prasad Verma Vs. State of Bihar; (2000) 4 SCC 168 , M. Krishnan Vs. Vijay Singh ; (2001) 8 SCC 645 and Zandu Pharmaceutical Works Ltd. Vs. Mohd. Sharaful Haque; (2005) 1 SCC 122 . State (NCT of Delhi; (1999) 3 SCC 259 , Medchl Chemicals & Pharma (P) Ltd. Vs. Biological E.Ltd.; (2000) 3 SCC 269 , Hridaya Ranjan Prasad Verma Vs. State of Bihar; (2000) 4 SCC 168 , M. Krishnan Vs. Vijay Singh ; (2001) 8 SCC 645 and Zandu Pharmaceutical Works Ltd. Vs. 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. 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: 9a) 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. (v) A given set of facts may make out: 9a) 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 proceeding 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. In view of the discussion made above, it is held that no ingredients of offence under Sections 406 and 420 of I.P.C. is made out especially in the backdrop of the present allegation levelled in the complaint, even taken into entirety. Hence the entire criminal proceeding inclusive of the cognizance order dated 13.06.2008 passed by the learned Judicial Magistrate, 1st Class, Araria in Complaint Case No. 565C of 2008 is hereby quashed. 14. The application stands allowed.