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2023 DIGILAW 2119 (PNJ)

Yogendra Jain v. State of Haryana

2023-07-11

GURBIR SINGH

body2023
Judgment Mr. Gurbir Singh , J. The present petition has been filed under Section 482 Cr.P.C. for quashing of the FIR No.0160 dated 21.03.2018 under Sections 406 and 420 of IPC registered at Police Station Jind City, Haryana. 2. In the case in hand, petitioners were earlier purchasing goods from respondent firm of respondent No.2 and were making the payment. 3. The dispute if any, between the parties is non payment of sum of Rs.2,35,000/- which was part of price of goods. 4. The FIR in question was registered on the basis of written complaint, brief facts as mentioned in the complaint are that the applicants namely Bhichha Ram, Satish Kumar are the Directors of the firm S.J.D. Surgicot Pvt. Ltd. Bhiwani road, Jind and they do the business of manufacturing and selling of absorbent cotton roll I.P. in their firm. The accused-petitioners used to purchase cotton rolls from their aforesaid firm and used to come to Jind for 2-3 times in a month and used to stay there for 4-5 days for purchasing cotton rolls. They kept purchasing cotton rolls from their firm and Rs.3,89,096/- became due towards them. On 17.04.2014 the said accused purchased cotton rolls worth Rs. 2.70 lac more. The accused made payment of the aforementioned sum but out of the goods purchased amounting to Rs.2.70 lac, only Rs.35,000/- was paid and sum of Rs.2,35,000/- is due towards the accused. Accused came to their factory 2-3 times and asked to supply more material but complainant told to deposit the sum due earlier and then only more material would be supplied. They raised the demand from their mobile phone to make the payment of the due amount. Time and again, it was assured that the payment would be made. Now, if they make telephone call to him then he uses abusive language and has blatantly denied to make payment of their amount due and states that if they make telephone call in future then he would get them killed and would cause heavy loss to them and he is not making the payment of the due amount. The accused has committed fraud and has threatened to kill. The said application was inquired into and a case in question was registered under Section 420/406 of IPC. 5. The accused has committed fraud and has threatened to kill. The said application was inquired into and a case in question was registered under Section 420/406 of IPC. 5. Learned counsel for the petitioners has argued that there was business relationship between the parties and the respondent No.2 is the Director of one SJD Surgicot Pvt. Ltd. Bhiwani Road, Jind, Haryana and are the manufacturers of Absorbent Cotton Roll I.P. The petitioners are the partners of Link Surgical Udyog, Daal Bazar, Lashkar, Gwalior, M.P. and used to purchase cotton rolls from the respondent No.2. In the year 2014, petitioners purchased cotton roll of Rs.2,70,504/- and payment of the said amount was made through cheque which was cleared on 17.10.2014. A copy of the cheque showing the bank transactions is annexed herewith as Annexure P-2. All of a sudden in the year 2018, the respondent No.2 started making pressure on the petitioners that they had purchased cotton rolls of Rs.2,70,000/- in the year of 2014 and did not make entire payment but paid only sum of Rs.35,000/- and sum of Rs.2,35,000/- remains to be due. They asked to pay the same otherwise coercive action would be taken against them and they would face criminal case. The petitioners declined that any such amount remained to be paid. In January 2018, petitioners received a notice from Economic Offence Branch, District Jind that a complaint had been lodged against them by respondent No.2 and they were required to attend the office on 28.01.2018. The petitioners telephoned the respondent No.2 and told him about the payment and it was assured that the matter would be settled. In the year June 2018, police came to Gwalior and police recorded the statement of petitioner No.2. A copy of the said statement is annexed herewith as Annexure P-5.Thereafter, the instant case was registered. The amount due, if any, has already been paid. Moreover the dispute, if any, is purely of civil nature and no offence is made out against the petitioners. A copy of the said statement is annexed herewith as Annexure P-5.Thereafter, the instant case was registered. The amount due, if any, has already been paid. Moreover the dispute, if any, is purely of civil nature and no offence is made out against the petitioners. Learned counsel for the petitioner has placed on reliance upon cases of “Shron Michael and others versus State of Tamilnadu and others” 2009 (3) SCC 375 ; Vijay Kumar Ghai and others versus State of West Bengal and others decided 2022 (2) RCR (Criminal) 528; “Vesa Holdings Pvt. Ltd. and another versus State of Kerala and others” 2015(8) SCC 293 ; “R. Kalyani versus Janak C. Mehta and others” (2008) (14) SCALE 85; “Uma Shankar Gopalika verus State of Bihar and others” (2006) 2 SCC (Criminal) 49; “Rambiraji Devi and another versus Umesh Kumar Singh and another” (2006) 6 SCC 689; Murarilal Gupta Vs. Gopi Singh” (2005) 13 SCC 699 ; “Inder Mohan Goswami and another versus State of Uttranchal and others” AIR 2008 SC 251 ; “B. Suresh Yadav versus Sharifa bee and another” 2007 (3) SCC 107; “G. Sagar Suri and another versus State of U.P. and others (2000) 2 SCC 636 ; “Manoj Mahavir Prasad Khaitan versus Ram Gopal Poddar and another” 2010 (10) SCC 673 . 6. Learned State counsel and counsel for respondent No.2 have opposed the prayer for quashing of the FIR. 7. It is argued that the intention of the petitioners at the time of making purchase was to commit fraud and they dishonestly induced the respondent No.2 to sell the goods but they had no intention to pay the price of the goods since date of purchase. They have placed reliance upon the judgment of “Kamaladevi Agarwal versus State of West Bengal and others” AIR 2001 SC 3846 , an authority of Hon’ble Apex Court and “Lalmuni Devi versus State of Bihar and others” Appeal (Crl.) 1127 of 2000 SLP (Crl.) 701 of 2000 decided on 15.12.2000 by Hon’ble Supreme Court of India. 8. I heard the submissions made by learned counsel for the petitioners, learned counsel for respondent No.2/complainant and learned State counsel. 9. Section 405 of IPC defines Criminal Breach of Trust which reads as under:- “405. 8. I heard the submissions made by learned counsel for the petitioners, learned counsel for respondent No.2/complainant and learned State counsel. 9. Section 405 of IPC defines Criminal Breach of Trust which reads as under:- “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 of 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 had made touching the discharge of such trust, or wilfully suffers any other person so to do, commits “criminal breach of trust”. The essential ingredients of the offense of criminal breach of trust are:- (1) The accused must be entrusted with the property or with dominion over it, (2) The person so entrusted must use that property, or; (3) The accused must dishonestly use or dispose of that property or wilfully suffer any other person to do so in violation, (a) of any direction of law prescribing the mode in which such trust is to be discharged, or; (b) of any legal contract made touching the discharge of such trust.” 10. Thus, the Act of criminal breach of trust would inter alia means using or disposing of the property by person who is entrusted with or has otherwise dominion there over. Such an act must not only be done dishonestly but also in violation of any direction of law or any contract express or implied relating to carrying out the trust. In case in hand the petitioners were neither entrusted with any property nor with dominion over any property, so provision of Section 406 are not attracted in the instant FIR. 11. Section 415 of IPC defines cheating which reads as under:- “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 intentioanlly 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”. The essential ingredients of offence of cheating are as under:- 1. Deception of any person 2. (a) Fraudulently or dishonestly inducing that person- (i) to deliver any property to any person: or (ii) to consent that any person shall retain any property; or (b) intentionally inducing that person 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.” 12. Thus, a person who dishonestly induces another person to deliver any property is liable for the offence of cheating. 13. Section 420 of IPC defines cheating and dishonestly inducing the delivery of property which reads as under:- “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 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.” To establish the offence of Cheating in inducing the delivery of property, the following ingredients need to be proved:- 1. The representation made by the person was false 2. The accused had prior knowledge that the representation he made was false. 3. The accused made false representation with dishonest intention in order to deceive the person to whom it was made. 4. The act where the accused induced the person to deliver the property or to perform or to abstain from any act which the person would have not done or had otherwise committed.” 14. In case of, “Hridya Ranjan Prasad Verma & Ors. Vs. State of Bihar & Anr. (2004) 4 SCC 168”; it is held by Hon’ble Apex Court that the distinction between mere breach of contract and cheating, which is criminal offence, is a fine one. While breach of contract cannot give rise to criminal prosecution for cheating, fraudulent or dishonest intention is the basis of the offence of cheating. Vs. State of Bihar & Anr. (2004) 4 SCC 168”; it is held by Hon’ble Apex Court that the distinction between mere breach of contract and cheating, which is criminal offence, is a fine one. While breach of contract cannot give rise to criminal prosecution for cheating, fraudulent or dishonest intention is the basis of the offence of cheating. In case of “Vijay Kumar Ghai and others versus State of West Bengal and others”, it is held by Hon’ble Apex Court that breach of contract cannot be obliged to criminal prosecution for cheating. It is further held in order to attract ingredients of cheating, it is imperative on the part of the complainant to prima facie establish that there was intention on the part of the petitioner or others to cheat or to defraud the complainant right from its inception. In case of “Vesa Holdings Pvt. Ltd. & Anr Versus State of Kerala & Ors”, the Hon’ble Apex Court made the observations which is reproduced below:- “It is true that a given set of facts may make out a civil wrong as also a criminal offence and only because a civil remedy may be available to the complainant that itself cannot be ground to quash a criminal proceeding. The real test is whether the allegations in the complaint disclose the criminal offence of cheating or not. In the present case, there is nothing to show that at the very inception there was any inception on behalf of an accused person to cheat which is a condition precedent for an offence under Section 420 IPC. In our view, the complaint does not disclose any criminal offence at all. Criminal proceedings should not be encouraged when it is found to be mala fide or otherwise an abuse of the process of the Courts. Superior courts while exercising this power should also strive to serve the ends of justice. In our opinion, in view of these facts allowing the police investigation to continue would amount to an abuse of process of the court and the High Court committed an error in refusing to exercise the power under Section 482 Cr.P.C, 1973 to quash the proceedings.” 15. In our opinion, in view of these facts allowing the police investigation to continue would amount to an abuse of process of the court and the High Court committed an error in refusing to exercise the power under Section 482 Cr.P.C, 1973 to quash the proceedings.” 15. In case of “Kamaladevi Agarwal versus State of West Bengal and others” cited supra by the learned counsel for respondent No.2, the criminal proceedings are quashed on the ground that there are several proceedings pending in the High Court. The extract of the said judgment read as under:- “17. In view of the authorities to the contrary, we are satisfied that the High Court was not justified in quashing the proceedings initiated by the appellant against the respondents. We are also not impressed by the arguments that as the civil suit was pending in the High Court, the Magistrate was not justified to proceed with the criminal case either in law or on the basis propriety. Criminal cases have to be proceeded with in accordance with the procedure as prescribed under the Code of Criminal Procedure and the pendency of a civil action in a different court even though higher in status and authority, cannot be made a basis for quashing of the proceedings.” 16. In case of “Lalmuni Devi Versus State of Bihar and others” cited supra by learned counsel for respondent No.2, it is held by Hon’ble Apex Court that there could be no dispute to the proposition that if the complaint does not make out an offence it can be quashed. However, it is also settled law that facts may give rise to a civil claim and also amount to an offence. Merely because a civil claim is maintainable does not mean that the criminal complaint cannot be maintained. Said authorities are distinguishable on facts and ratio of said authority cannot be applied to the facts of instant case. 17. The petitioners purchased more goods from the respondent No.2/complainant. As per allegations, out of the amount of Rs.2,70,000/-, petitioners paid only sum of Rs.35,000/- and balance amount was due towards the petitioners and when the said amount was demanded, instead of paying the same, they gave threats and refused to pay the said amount. The dispute between the parties is of partly civil nature but it has been given a colour of criminal dispute. The dispute between the parties is of partly civil nature but it has been given a colour of criminal dispute. It is a case of simple breach of contract. The registration of case against the petitioner is an abuse of process of law and allowing the FIR would amount to abuse of process of the Court. In order to serve the ends of justice, the instant FIR is hereby quashed alongwith all the proceedings arising out of the FIR. As a result, the present petition is allowed.