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2020 DIGILAW 533 (GAU)

Sanjiv Gogoi @ Sanjeeb Gogoi v. State Of Assam

2020-05-29

MANISH CHOUDHURY

body2020
JUDGMENT Manish Choudhury, J. - This criminal petition is preferred under Section 482, Code of Criminal Procedure, 1973 (''the Code'' and/or ''the CrPC'', for short) seeking quashing and setting aside of the criminal proceeding of complaint case, C.R. Case no. 52/2014, presently pending before the Court of learned Judicial Magistrate, First Class, Margherita (''the trial court'', for short) and the order dated 10.07.2014 whereby the learned trial court taking cognizance of the offences punishable under Sections 420/34, Indian Penal Code (IPC), had issued process against the petitioner. 2. Heard Mr. T.J. Mahanta, learned Senior counsel for the petitioner and Ms. S. Jahan, learned Additional Public Prosecutor for respondent no. 1, State of Assam. None has appeared for the respondent no. 2-complainant today on call, though notice is found to be duly served on respondent no. 2 and the name of the learned counsel for the respondent no. 2 has appeared in the cause-list. 3. Mr. Mahanta, learned Senior counsel for the petitioner has submitted that though the petitioner has been arraigned as an accused by name but, in essence, the allegations are leveled in his capacity as a Director of M/s Sanjeeb Tea Industries (P) Ltd. in the complaint case, C.R. Case No. 52/2014, without arraigning the company viz. M/s Sanjeeb Tea Industries (P) Ltd. as an accused. He has further submitted that if the complaint is read as a whole and even if the allegations made therein are accepted at face value no ingredients constituting the offence of cheating can be said to be present. As only the petitioner (hereinafter also referred to as ''the accused'', at places, for easy reference) has been arraigned as an accused, there could not have been any cognizance of the offence under Section 34, IPC. He has further submitted that the learned trial court did not follow the procedure prescribed under Section 202, CrPC before taking cognizance of the offences and issuing process against the petitioner as an accused when the petitioner is not a resident of the area of jurisdiction of the learned trial court. 4. Ms. S. Jahan, learned Additional Public Prosecutor has submitted that the complainant in his complaint has alleged that the accused had induced the complainant to deliver the coal and the accused had no intention to make the payment for the coal so supplied right from the beginning of his approach. 5. 4. Ms. S. Jahan, learned Additional Public Prosecutor has submitted that the complainant in his complaint has alleged that the accused had induced the complainant to deliver the coal and the accused had no intention to make the payment for the coal so supplied right from the beginning of his approach. 5. I have duly considered the submissions of the learned counsel for the parties. I have also perused the materials available in the record of the trial court. 6. In order to understand the averments and allegations made by the complainant and the contentions advanced on behalf of the accused in the present criminal petition, it would be apt to refer to the complaint and the initial deposition of the complainant recorded under Section 200, CrPC. wxyz 6.1. The complaint is filed on behalf of one M/s Pankaj Coal Enterprise which is stated to be a registered partnership firm. In the complaint under reference, the complainant firm has been represented by one of its partner. The complainant firm has its business office and head office at Margherita, District - Tinsukia. In the complaint, it is mentioned that the complainant firm is having business relationship with the accused and the complainant firm used to supply coal to the accused on his promise to pay the amount on credit basis. On 27.07.2011, the accused approached one of the partners of the complainant firm and requested him to deliver one truck load of coal to its tea estate viz. M/s Sanjeeb Tea Industries (P) Ltd. located in District Golaghat. It is stated that the accused had promised to pay the price of coal ordered to the complainant within a short period after delivery of the coal. Believing on the assurance of the accused, the complainant firm had supplied and delivered the coal so ordered, weighing 20,780 Kg, vide consignment note/challan dated 27.07.2011 by a truck and the same was delivered at the destination on 30.07.2011. It is mentioned that the delivery of coal was duly received by the accused by signing the consignment note. It is mentioned that the value of delivered coal was Rs. 1,28,835.81 and the transportation charges were Rs. 24,936. It is contended that the accused had induced the complainant to deliver him the coal but he did not pay the price of coal and transportation charges thereafter, despite repeated requests made by the complainant on subsequent dates. It is mentioned that the value of delivered coal was Rs. 1,28,835.81 and the transportation charges were Rs. 24,936. It is contended that the accused had induced the complainant to deliver him the coal but he did not pay the price of coal and transportation charges thereafter, despite repeated requests made by the complainant on subsequent dates. Communications were also sent by the complainant on 06.05.2014 and 20.05.2014 respectively requesting the accused to pay the price of the coal and transportation charges. As the accused failed and neglected to pay the amount, the complainant firm alleging that it had been cheated, had filed the complaint. According to the complainant, the accused had committed the offences under Sections 420/34, IPC. zyxw wxyz 6.2. In his initial deposition recorded under Section 200, CrPC, the partner of the complainant firm stated to the effect that the complaint had been instituted against the sole accused, who is a Director in M/s Sanjeeb Tea Industries (P) Ltd. They had business transactions from an earlier point of time. On 27.07.2011, the sole accused had come to their office in order to purchase coal and it was assured to the complainant that the payment for coal would be made immediately after delivery of the coal. Accordingly, the complainant on that day itself loaded 20,780 kgs of coal in a truck and sent the truck to M/s Sanjeeb Tea Industries (P) Ltd. The value of the consignment was Rs. 1,28,835.81 and an amount of Rs. 24,936/- was incurred towards transportation charges. The consignment was delivered at the destination on 30.07.2011 and the same was duly received by the consignee at their end under seal and signature. When the amounts, mentioned above, were not received from the accused, the complainant firm made correspondences by letters dated 06.05.2014 and 20.05.2014 asking the accused to make payment of the amounts. It was alleged that the accused did not have the intention to make the payment from the very inception. The complainant firm had submitted 8 (eight) nos. of documents in support of its contentions. zyxw 7. The complaint was filed before the Court of learned Sub-Divisional Judicial Magistrate, Margherita on 07.07.2014. On receipt of the complaint, the same has been registered as C.R. Case no. 52/2014. The complaint was, thereafter, forwarded to the trial court for disposal. The complainant firm had submitted 8 (eight) nos. of documents in support of its contentions. zyxw 7. The complaint was filed before the Court of learned Sub-Divisional Judicial Magistrate, Margherita on 07.07.2014. On receipt of the complaint, the same has been registered as C.R. Case no. 52/2014. The complaint was, thereafter, forwarded to the trial court for disposal. On receipt of the complaint, the learned trial court taking cognizance of the complaint, recorded the initial deposition of the complainant under Section 200, CrPC. Finding sufficient ground to proceed against the accused for the offences punishable under Sections 420/34, IPC, process was issued to the accused for his appearance to stand the trial. 8. A perusal of the complaint goes to show that the petitioner has been arraigned as the sole accused in his capacity as a Director in M/s Sanjeeb Tea Industries (P) Ltd. In the complaint itself, the complainant has mentioned that the complainant was requested to deliver the ordered coal at the tea estate of M/s Sanjeeb Tea Industries (P) Ltd., a company incorporated under the Companies Act. M/s Sanjeeb Tea Industries (P) Ltd. is a body corporate. But the complainant had chosen not to arraign the company viz. M/s Sanjeeb Tea Industries (P) Ltd. as an accused. 9. A perusal of the Consignment Note/Challan dated 27.07.2011 goes to show that the consignor was M/s Pankaj Coal Enterprise and the consignee was Manager, M/s Sanjeeb Tea Industries (P) Ltd. The Retail Invoice dated 27.07.2011 mentioned M/s Pankaj Coal Enterprise as the seller and M/s Sanjeeb Tea Industries (P) Ltd. as the buyer. The Transport Invoice dated 27.07.2011 also mentioned M/s Pankaj Coal Enterprise as the seller and Manager, M/s Sanjeeb Tea Industries (P) Ltd. as the buyer. The correspondence dated 06.05.2014 and 20.05.2014 were addressed to the Manager, M/s Sanjeeb Tea Industries (P) Ltd. 10. Before proceeding further, it would be apt to refer to the offence of cheating, alleged by the complainant. While Section 415, IPC deals with cheating, Section 420, IPC is cheating and dishonestly inducing delivery of property and they read as follows : wxyz "415. Before proceeding further, it would be apt to refer to the offence of cheating, alleged by the complainant. While Section 415, IPC deals with cheating, Section 420, IPC is cheating and dishonestly inducing delivery of property and they read as follows : wxyz "415. Cheating.-Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, mind, reputation or property, is said to "cheat". Explanation.-A dishonest concealment of facts is a deception within the meaning of this section. zyxw wxyz "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." zyxw 11. The ingredients required to constitute the offence of cheating under Section 415, IPC have been explained by the Supreme Court in Ram Jas vs. State of U.P., (1970) 2 SCC 740 as under :- wxyz "The ingredients required to constitute an offence of cheating are :- zyxw wxyz (i) There should be fraudulent or dishonest inducement of a person by deceiving him; zyxw wxyz (ii) (a) the person who is deceived should be induced to deliver any property to any person, or to consent that any person shall retain any property; or zyxw wxyz (b) the person who is deceived should be intentionally induced to do or omit to do anything which he would not do or omit if he were not so deceived; and zyxw wxyz (iii) in cases covered by (ii)(d) the act or omission should be one or which is likely to cause damage or harm to the person induced in body, mind, reputation or property." zyxw 12. There is a distinction between mere breach of contract and the offence of cheating. It depends upon the intention of the accused at the time of inducement which can sometimes be judged by his subsequent conduct but the subsequent conduct cannot be the sole test. Mere breach of contract cannot give rise to criminal prosecution for cheating unless fraudulent or dishonest intention is shown to exist right at the beginning of the transaction, that is, the time when the offence is said to be committed. Thus, it is the intention which is the gist of the offence. To hold a person guilty of cheating, it is necessary to show that he had fraudulent or dishonest intention at the time of making the promise. From his mere failure to keep up promise subsequently such a culpable intention right at the beginning, that is, when he made the promise cannot be presumed. To deceive is to induce a person to believe that a thing is true which is false and which the person practicing the deceit knows or believes to be false. 13. It is true that a dispute arising out of a contract or commercial transaction may apparently look to be a civil nature but such civil nature of dispute may also have ingredients of criminal offences in certain circumstances. These two remedies are of different nature. Merely because there is remedy by way of civil suit the same cannot be an impediment to maintain a criminal complaint but the complaint must disclose the ingredients of the offence alleged. Thus, the test is whether the allegations made in the complaint if after accepting them at face value without examining their veracity, disclose the criminal offence alleged against the accused. 14. The case of the complainant here is that the accused had cheated him and thereby dishonestly induced him to deliver the truck load of coal. 15. Thus, the test is whether the allegations made in the complaint if after accepting them at face value without examining their veracity, disclose the criminal offence alleged against the accused. 14. The case of the complainant here is that the accused had cheated him and thereby dishonestly induced him to deliver the truck load of coal. 15. A reading of the complaint case to show that the complainant firm and M/s Sanjeeb Tea Industries (P) Ltd. were having business relationship from a prior date through the partners of the complainant firm and through the petitioner who is one of the Directors in M/s Sanjeeb Tea Industries (P) Ltd. The complainant has averred that the complainant used to supply coal to M/s Sanjeeb Tea Industries (P) Ltd. It is, thus, demonstrated that the supply of coal from the complainant firm to M/s Sanjeeb Tea Industries (P) Ltd. had been going on from an earlier date. Thus, any allegation of wilful misrepresentation cannot be sustained. In the complaint, there is no allegation about any fraudulent or dishonest inducement on the part of the accused. It had merely stated that the accused had induced the complainant to deliver the coal. Thus, on a reading of the complaint in its entirety, the ingredients of the offences defined under Section 415, IPC and consequently, Section 420, IPC are found absent. As only the petitioner has been arraigned as the accused in the complaint, there could not have been any cognizance under Section 34, IPC. 16. The dispute between the parties herein is essentially a civil dispute. Mere non-payment of the price of coal does not amount to commission of an offence of cheating. Only because M/s Sanjeeb Tea Industries (P) Ltd. did not make the payment, the same by itself would not mean that the accused had cheated the complainant. 17. It is projected on behalf of the petitioner in this petition that subsequent to the delivery of the coal so ordered, payment was made on behalf of M/s Sanjeeb Tea Industries (P) Ltd. and to substantiate the same, the petitioner has annexed the bank statement of M/s Sanjeeb Tea Industries (P) Ltd. for the relevant period wherein in the entry dated 13.08.2011, an amount of Rs. 1,29,874 vide cheque no. 473167 was shown to be paid to M/s Pankaj Coal Enterprise i.e. the complainant. Despite service of notice, the respondent no. 1,29,874 vide cheque no. 473167 was shown to be paid to M/s Pankaj Coal Enterprise i.e. the complainant. Despite service of notice, the respondent no. 2-complainant has not traversed the said averment made by the petitioner in the petition for the last 5 (five) years. 18. There is another aspect of the matter. The Indian Penal Code save and except some provisions specifically provided therein, does not provide for extension of the concept of vicarious liability in all situations. wxyz 18.1. In the case of S.K. Alagh vs. State of Uttar Pradesh, (2008) 5 SCC 662 , it has been observed as under : - zyxw wxyz "14. Appellant 1 is the Managing Director of the Company. Respondent 3 was its General Manager. Indisputably, the company is a juristic person. The demand drafts were issued in the name of the Company. The Company was not made an accused. The dealership agreement was by and between M/s. Akash Traders and the Company. zyxw wxyz 16. The Penal Code, save and except some provisions specifically providing therefor, does not contemplate any vicarious liability on the part of a party who is not charged directly for commission of an offence. zyxw wxyz 19. As, admittedly, drafts were drawn in the name of the company, even if appellant was its Managing Director, he cannot be said to have committed an offence under Section 406 of the Penal Code. If and when a statute contemplates creation of such a legal fiction, it provides specifically therefor. In absence of any provision laid down under the statute, a Director of a company or an employee cannot be held to be vicariously liable for any offence committed by the company itself. {See Sabitha Ramamurthy vs. R.B.S. Channabasavaradhya, (2006) 10 SCC 581 } ." zyxw wxyz 18.2. In Maksud Saiyed vs. State of Gujarat, (2008) 5 SCC 668 , the Supreme Court has observed as under :- zyxw wxyz "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. Indian 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. Indian 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." zyxw wxyz 18.3. In Maharashtra State Electricity Distribution Company Limited vs. Datar Switchgear Limited, (2010) 10 SCC 479 , it is observed to be trite law that wherever by a legal fiction the principle of vicarious liability is attracted and a person who is otherwise not personally involved in the commission of an offence is made liable for the same, it has to be specifically provided in the statute concerned. zyxw wxyz 18.4. In R. Kalyani Vs. Janak C. Mehta and others, (2009) 1 SCC 516 , the Supreme Court has observed to the following effect :- zyxw wxyz 41. If a person, thus, has to be proceeded with as being variously liable for the acts of the company, the company must be made an accused. In any event, it would be a fair thing to do so, as legal fiction is raised both against the Company as well as the person responsible for the acts of the Company. zyxw 19. From the principles that is laid down in the above decisions, it is manifest that vicarious liability of the Managing Directors and Directors can arise provided there is any provision in the Indian Penal Code in that regard, but there is no such provisions in the Indian Penal Code. M/s Sanjeeb Tea Industries (P) Ltd., as the name suggests, is a body corporate and it has a separate existence from its Managing Director and Directors. M/s Sanjeeb Tea Industries (P) Ltd., as the name suggests, is a body corporate and it has a separate existence from its Managing Director and Directors. From the discussions made above, it is very much evident that the order for coal was placed to the complainant firm for and on behalf of the company, M/s Sanjeeb Tea Industries (P) Ltd., albeit through the accused in his capacity as a Director of the said company. But such order was never placed by the accused in his personal capacity. The complainant was well aware of the said position as in the complaint, the accused has been arraigned showing him as the Director of M/s Sanjeeb Tea Industries (P) Ltd. and the Consignment/Note/Challan dated 27.07.2011, the Retail Invoice dated 27.07.2011 and the Transport Invoice dated 27.07.2011 were issued in the name of the Manager, M/s Sanjeeb Tea Industries (P) Ltd. But the company is not made an accused. Thus, in absence of arraignment of the company, M/s Sanjeeb Tea Industries (P) Ltd., the complaint instituted with only the accused by his name but in his capacity as its Director is found not maintainable. On this count also, the criminal proceeding of complaint case, C.R. Case no. 52/2014 is liable to be quashed. 20. The principles to exercise the inherent jurisdiction under Section 482 of the Code is well settled by a catena of decisions of the Supreme Court as well as of this court. In State of Haryana vs. Bhajan Lal, (1992) Supp1 SCC 335 , the category of cases in which the Court can exercise its extra-ordinary power under Article 226 of the Constitution of India or the inherent powers under Section 482 of the Code of Criminal Procedure, either to prevent abuse of the process of the Court or otherwise to secure the ends of justice, are summarized as under : wxyz "102. In the backdrop of the interpretation of the various relevant provisions of the Code under Chapter XIV and of the principles of law enunciated by this Court in a series of decisions relating to the exercise of the extra-ordinary power under Article 226 or the inherent powers u/s 482 of the Code which we have extracted and reproduced above, we give the following categories of cases by way of illustration wherein such power could be exercised either to prevent abuse of the process of any Court or otherwise to secure the ends of justice, though it may not be possible to lay down any precise, clearly defined and sufficiently channelised and inflexible guidelines or rigid formulae and to give an exhaustive list of myriad kinds of cases wherein such power should be exercised. zyxw wxyz (1) Where the allegations made in the First Information Report or 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 a case against the accused. zyxw wxyz (2) Where the allegations in the First Information Report and other materials, if any, accompanying the F.I.R. do not disclose a cognizable offence, justifying an investigation by police officers u/s 156(1) of the Code except under an order of a Magistrate within the purview of Section 155(2) of the Code. zyxw wxyz (3) Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same do not disclose the commission of any offence and make out a case against the accused. zyxw wxyz (4) Where, the allegations in the F.I.R. do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated u/s 155(2) of the Code. zyxw wxyz (5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused. zyxw wxyz (5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused. zyxw wxyz (6) Where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the concerned Act, providing efficacious redress for the grievance of the aggrieved party. zyxw wxyz (7) Where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge. We also give a note of caution to the effect that the power of quashing a criminal proceeding should be exercised very sparingly and with circumspection and that too in the rarest of rare cases; that the Court will not be justified in embarking upon an enquiry as to the reliability or genuineness or otherwise of the allegations made in the F.I.R. or the complaint and that the extraordinary or inherent powers do not confer an arbitrary jurisdiction on the Court to act according to its whim or caprice." zyxw 21. As mentioned earlier, the allegations made in the complaint, even if they are taken at their face value and accepted to be correct in their entirety, do not constitute any offence of cheating under Section 420, IPC. The complaint is also not sustainable in view of not arraigning the company i.e. M/s Sanjeeb Tea Industries (P) Ltd. as an accused. In absence of the company, the concept of vicarious liability cannot be extended to the petitioner in the capacity of one of the Directors of the said company. A dilation on the non-adherence to the procedure under Section 202, CrPC appears not necessary in view of the observations made above. 22. As a result, this criminal petition is allowed. The criminal proceeding of complaint case no. C.R. Case no. 52/2014 and the order dated 10.07.2014 taking cognizance, are set aside and quashed. The accused is to be treated to be discharged of the offences alleged in the order dated 10.07.2014 taking cognizance. 22. As a result, this criminal petition is allowed. The criminal proceeding of complaint case no. C.R. Case no. 52/2014 and the order dated 10.07.2014 taking cognizance, are set aside and quashed. The accused is to be treated to be discharged of the offences alleged in the order dated 10.07.2014 taking cognizance. There shall, however, be no order as to cost.