Delhi District Court
M/S Advit Ventures P.Ltd vs M/S Ga Renewable Energy P.Ltd on 6 September, 2023
IN THE COURT OF SH. SUSHIL ANUJ TYAGI,
ADDITIONAL SESSIONS JUDGE-04:CENTRAL,
TIS HAZARI: DELHI
CNR No. DLCT01-002369-2022
CR No. 81/2022
M/s. Advit Ventures Pvt. Ltd.
Corporate Office at
102, Onkar House, Daryaganj,
New Delhi-110002.
..... Revisionist
Vs.
1. M/s. GA Renewable Energy Pvt. Ltd.
R/o. H. No. 145, Sector-8,
Panchkula (Haryana)
Also Available at :
Baddi University of Emerging Sci. Tech
Village Makhnu Majra,
P.O. Bhud, Tehsil Baddi,
District Solan, Himachal Pradesh-173205.
2. Mr. Gaurrav Ram Jhunjhunwala
Director
M/s. GA Renewable Energy Pvt. Ltd.
R/o. H. No. 145, Sector-8,
Panchkula (Haryana)
Also Available at :
Baddi University of Emerging Sci. Tech
Village Makhnu Majra,
P.O. Bhud, Tehsil Baddi,
District Solan, Himachal Pradesh-173205.
3. Mrs. Shradhha Jhunjhunwala
Director
CR No. 81/2022
M/s. Advit Ventures Vs. M/s. GA Renewable Energy Pvt. Ltd Page No. 1 of 15
M/s. GA Renewable Energy Pvt. Ltd.
R/o. H. No. 145, Sector-8,
Panchkula (Haryana)
Also Available at :
Baddi University of Emerging Sci. Tech
Village Makhnu Majra,
P.O. Bhud, Tehsil Baddi,
District Solan, Himachal Pradesh-173205.
4. Mr. Abhinav Dogra
Project Manager
M/s. GA Renewable Energy Pvt. Ltd.
R/o. H. No. 145, Sector-8,
Panchkula (Haryana)
Also Available at :
Baddi University of Emerging Sci. Tech
Village Makhnu Majra,
P.O. Bhud, Tehsil Baddi,
District Solan, Himachal Pradesh-173205.
5. M/s. Sara Textiles Ltd.
R/o. A-31, Hauz Khas
New Delhi-110016.
Also Available At :
Sara Textiles Ltd.
Mauz No. 86, Village Bhatian
Pragana Palasi, Teh. Nalagarh
District Solan, Himachal Pradesh-174101
Also Available At :
Sara House, B-8, Sector 4,
Noida, Uttar Pradesh-201301.
6. Mr. Shyam Mohan Dwivedi
CEO/Director, Sara Textiles Ltd.
R/o. A-31, Hauz Khas,
New Delhi-110016.
Also Available At :
CR No. 81/2022
M/s. Advit Ventures Vs. M/s. GA Renewable Energy Pvt. Ltd Page No. 2 of 15
Sara Textiles Ltd.
Mauz No. 86, Village Bhatian
Pragana Palasi, Teh. Nalagarh
District Solan, Himachal Pradesh-174101
Also Available At :
Sara House, B-8, Sector 4,
Noida, Uttar Pradesh-201301.
7. Mr. Devinder Pal Singh
Director, Sara Textiles Ltd.
R/o. A-31, Hauz Khas,
New Delhi-110016.
Also Available At :
Sara Textiles Ltd.
Mauz No. 86, Village Bhatian
Pragana Palasi, Teh. Nalagarh
District Solan, Himachal Pradesh-174101
Also Available At :
Sara House, B-8, Sector 4,
Noida, Uttar Pradesh-201301.
8. Mr. Om Prakash Yadav
Director, Sara Textiles Ltd.
R/o. A-31, Hauz Khas,
New Delhi-110016.
Also Available At :
Sara Textiles Ltd.
Mauz No. 86, Village Bhatian
Pragana Palasi, Teh. Nalagarh
District Solan, Himachal Pradesh-174101
Also Available At :
Sara House, B-8, Sector 4,
Noida, Uttar Pradesh-201301.
9. Mr. Deepit Singh
Director, Sara Textiles Ltd.
R/o. A-31, Hauz Khas,
CR No. 81/2022
M/s. Advit Ventures Vs. M/s. GA Renewable Energy Pvt. Ltd Page No. 3 of 15
New Delhi-110016.
Also Available At :
Sara Textiles Ltd.
Mauz No. 86, Village Bhatian
Pragana Palasi, Teh. Nalagarh
District Solan, Himachal Pradesh-174101
Also Available At :
Sara House, B-8, Sector 4,
Noida, Uttar Pradesh-201301.
10. Mr. Rahul Jain
Director, Sara Textiles Ltd.
R/o. A-31, Hauz Khas,
New Delhi-110016.
Also Available At :
Sara Textiles Ltd.
Mauz No. 86, Village Bhatian
Pragana Palasi, Teh. Nalagarh
District Solan, Himachal Pradesh-174101
Also Available At :
Sara House, B-8, Sector 4,
Noida, Uttar Pradesh-201301.
..... Respondents
Date of institution of Revision : 05.02.2022
Date on which order reserved : 01.08.2023
Date on which order pronounced : 06.09.2023
ORDER
1. This is a revision petition u/s. 397 Cr. P.C. for setting aside the impugned order dated 01.12.2021 passed by Sh. Gaurav Sharma, ld. MM, (Central), THC, Delhi, vide CR No. 81/2022 M/s. Advit Ventures Vs. M/s. GA Renewable Energy Pvt. Ltd Page No. 4 of 15 which ld. Trial Court had dismissed the application u/s. 156 (3) Cr. P.C. filed by the revisionist.
2. Brief facts of the case as per the revisionist are that the revisionist and the respondent no.1 company entered into an "Engineering, Procurement and Construction Agreement" on 24.06.2019 and pursuant to the said agreement, the revisionist initiated the work in July, 2019 and accordingly raised invoices from time to time. It is alleged that the revisionist has raised total invoice of Rs. 42,94,846/- and the respondents initially made payments and thereafter, kept on delaying the remaining payments on one pretext or other. The revisionist had only received a total of Rs. 33 Lacs and hence, a sum of Rs. 9,94,846/- remained outstanding due towards the respondents. It is alleged that the revisionist sent several reminders to the e- mail address of the respondents and the middle man i.e. Mr. Nitin also made several requests to the respondents through e-mail which were reverted by the respondents, wherein they sought time to clear the dues, which were found to be false and misleading. It is therefore, alleged that due to the fraud committed by the respondents, the revisionist has faced huge monetary loss.
3. The revisionist filed a complaint u/s. 200 Cr. P.C. alongwith the application u/s. 156 (3) Cr. P.C. against the respondents.
4. Vide impugned order, the ld. MM dismissed the application u/s. 156 (3) Cr. P.C. of the revisionist and took CR No. 81/2022 M/s. Advit Ventures Vs. M/s. GA Renewable Energy Pvt. Ltd Page No. 5 of 15 the cognizance u/s. 200 Cr. P.C. and listed the matter for leading pre-summoning evidence by the revisionist.
5. It is contended on behalf of the revisionist that the ld. Trial Court has failed to appreciate the facts correctly and passed the order without applying its judicial mind. It is argued that the complaint and supporting documents disclosed commission of cognizable offence and the ld. MM has wrongly dismissed the application u/s. 156 (3) Cr. P.C. solely relying upon the action taken report filed by the IO. It is argued that there are several other accused persons whose identity are not known to the revisionist and the revisionist has no source to ascertain their identities and as such police investigation is necessary. It is further argued that the ld. MM has failed to appreciate that the respondents have admitted their liability in the e-mails and the police investigation is needed to unearth the conspiracy between the respondents. It is argued that the ld. MM has failed to consider the fact that despite so many accused persons, IO has taken the statement of only one accused and no other person participated in the police inquiry. Ld. Counsel has relied upon several judgments to support his arguments that the police is bound to register the FIR if the complaint discloses commission of cognizable offences. The following judgments are relied upon by the ld. Counsel for the revisionist :-
(1) Lalita Kumari vs. Govt. of U.P. & Ors., Crl. Appeal No. 1410/2011 and 1267/2007;
(2) Radha vs. State, 2011 (179) DLT 810;CR No. 81/2022
M/s. Advit Ventures Vs. M/s. GA Renewable Energy Pvt. Ltd Page No. 6 of 15 (3) D.R. Bhatija vs. State, 1995 Cr. L.J. 2158; (4) Devarapalli Lakshminarayana Reddy vs. Narayana Reddy, 1976 (3) SCC 252;
(5) Gopal Das Sindhi vs. State of Assam, 1961 Crl. L.J. 39;
(6) Acharya Arun Dev vs. State, 2005 (2) JCC 897; (7) Ram Babu Gupta & Anr. vs. State of U.P. & Ors., 2001 Cr. L.J. 3363 (Allahabad);
(8) Superintendent of Police, CBI and Ors. vs. Tapan Kumar Singh, 2003 SCC (Cri.) 1305; & (9) Rajesh Bajaj vs. State of NCT of Delhi, 1999 Crl.
L.J. 1833.
6. Reply has been filed by the respondents in the present revision petition and it is argued that the revision is liable to be dismissed as the revisionist has suppressed the material and vital facts. It is further argued that the ld. MM has rightly passed the impugned order after recording cogent reasons. It is argued that the impugned order is interlocutory in nature and the revision is liable to be dismissed. It is further argued that the revisionist had failed to carry out the work in accordance with the agreement and the minor work which was carried out by the revisionist was faulty and not upto the standard and this fact was brought to the knowledge of the revisionist from time to time. It is submitted that number of reminders were sent to the revisionist to do the pending work but the revisionist never approached to complete the work. It is further submitted that the respondents suffered huge losses due to faulty work carried out by the revisionist and also CR No. 81/2022 M/s. Advit Ventures Vs. M/s. GA Renewable Energy Pvt. Ltd Page No. 7 of 15 suffered loss of their good will. It is further argued that the transaction between the parties was commercial in nature and the agreement between the parties provides for arbitration for resolution of dispute but the revisionist had filed the present petition to put the respondents under pressure and harass them. It is further submitted that the invoices raised by the revisionist are highly inflated and also for the work which was never done by the revisionist. It is further argued that the revisionist had already received Rs. 33 Lacs from the respondents which clearly shows that there was no intention to commit cheating or criminal breach of trust.
7. This Court has heard the rival contentions from both the sides and has gone through the judicial record.
8. It is settled law that where the complaint discloses commission of cognizable offence, FIR must be registered. If the police declines to register an FIR, it is open to the complainant to approach the Magistrate u/s. 156 (3) Cr. P.C. for registration of complaint. Upon receiving any such application, the Magistrate may either direct the registration of FIR or he may proceed to examine the witnesses of the complainant u/s. 200 Cr. P.C. instead of directing an investigation u/s. 156 (3) Cr. P.C. The Magistrate has wide powers u/s. 156 (3) Cr. P.C. which ought to be exercised judicially towards meeting the ends of justice.
9. In Madhu Bala vs. Suresh Kumar and Anr., (1997) 8 CR No. 81/2022 M/s. Advit Ventures Vs. M/s. GA Renewable Energy Pvt. Ltd Page No. 8 of 15 SCC 476, the Hon'ble Apex Court held as follows:-
"From a combined reading of the aforesaid provisions, it is abundantly clear that when a written complaint disclosing a cognizable offence is made before the Magistrate, he may take cognizance upon the same under Section 190 (1)(a) of the Code and proceed with the same in accordance with the provision of Chapter XV. The other option available to the Magistrate is such a case is to send the complaint to the police station u/s. 156 (3) Cr. P.C. for investigation."
10. Chapter XV provides procedure to be followed by Magistrate when a complaint disclosing cognizable offences is filed before him. The Magistrate has three options when a complaint is filed before him and he has taken cognizance; First option available before him is to take cognizance or to fix the case for complainant evidence as provided u/s. 200 Cr. P.C. and second option available with him either inquire into the case himself or direct an investigation to be made by the police officer or by such other person as he thinks fit, after taking cognizance u/s. 202 Cr. P.C. and the third option available to the Magistrate in such a case is to send the complaint to the police station as provided u/s. 156 (3) Cr. P.C. for investigation.
11. The Hon'ble High Court of Delhi in Subhkaran Laharuka and Anr. Vs. State and Anr., MANU/DE/1646/2010 laid down the guidelines for subordinate Courts for the procedure to be followed while dealing with the application u/s. 156 (3) Cr. P.C. It was held thus:-
CR No. 81/2022M/s. Advit Ventures Vs. M/s. GA Renewable Energy Pvt. Ltd Page No. 9 of 15 "52A. For the guidance of subordinate courts, the procedure to be followed while dealing with an application under Section 156(3) of the Code is summarized as under:--
(i) Whenever a Magistrate is called upon to pass orders under Section 156(3) of the Code, at the outset, the Magistrate should ensure that before coming to the Court, the Complainant did approach the police officer in charge of the Police Station having jurisdiction over the area for recording the information available with him disclosing the commission of a cognizable offence by the person/persons arrayed as an accused in the Complainant. It should also be examined what action was taken by the SHO, or even by the senior officer of the Police, when approached by the Complainant under Section 154(3) of the Code.
(ii) The Magistrate should then form his own opinion whether the facts mentioned in the complaint disclose commission of cognizable offences by the accused persons arrayed in the Complaint which can be tried in his jurisdiction.
He should also satisfy himself about the need for investigation by the Police in the matter. A preliminary enquiry as this is permissible even by an SHO and if no such enquiry has been done by the SHO, then it is all the more necessary for the Magistrate to consider all these factors. For that purpose, the Magistrate must apply his mind and such application of mind should be reflected in the Order passed by him.
Upon a preliminary satisfaction, unless there are exceptional circumstances to be recorded in writing, a status report by the police is to be called for before passing final orders.
(iii) The Magistrate, when approached with a Complaint under Section 200 of the Code, should invariably proceed under Chapter XV by taking cognizance of the Complaint, recording evidence and then deciding the question of issuance of process to the accused. In that case also, the Magistrate is fully entitled to postpone the process if it is felt that there is a necessity to call for a police report under Section 202 of the Code.
(iv) Of course, it is open to the Magistrate to proceed under Chapter XII of the Code when an application under Section 156(3) of the Code is CR No. 81/2022 M/s. Advit Ventures Vs. M/s. GA Renewable Energy Pvt. Ltd Page No. 10 of 15 also filed along with a Complaint under Section 200 of the Code if the Magistrate decides not to take cognizance of the Complaint. However, in that case, the Magistrate, before passing any order to proceed under Chapter XII, should not only satisfy himself about the pre-requisites as aforesaid, but additionally, he should also be satisfied that it is necessary to direct Police investigation in the matter for collection of evidence which is neither in the possession of the complainant nor can be produced by the witnesses on being summoned by the Court at the instance of complainant, and the matter is such which calls for investigation by a State agency. The Magistrate must pass an order giving cogent reasons as to why he intends to proceed under Chapter XII instead of Chapter XV of the Code."
12. In Skipper Beverages Pvt. Ltd. v. State, 2001 SCC OnLine Del 448, the Hon'ble Court observed as follows :
"7. It is true that Section 156(3) of the Code empowers a Magistrate to direct the police to register a case and initiate investigations but this power has to be exercised judiciously on proper grounds and not in a mechanical manner. In those cases where the allegations are not very serious and the complaint himself is in possession of evidence to prove his allegations there should be no need to pass orders under Section 156(3) of the Code. The discretion ought to be exercised after proper application of mind and only in those cases where the Magistrate is of the view that the nature of the allegations is such that the complaint himself may not be in a position to collect and produce evidence before the Court and interests of justice demand that the police should step in to help the complaint. The police assistance can be taken by a Magistrate even under Sec. 202(1) of the Code after taking cognizance and proceeding with the complaint under Chapter XV of the Code as held by Apex Court in 2001 (1) Supreme page 129 titled "Suresh Chand Jain v. State of Madhya Pradesh & Ors."
13. It is needless to mention that the Magistrate should be CR No. 81/2022 M/s. Advit Ventures Vs. M/s. GA Renewable Energy Pvt. Ltd Page No. 11 of 15 satisfied whether the direction of police investigation is necessary for collection of evidence which is neither in the possession of the complainant nor which can be produced by the witnesses on being summoned at the instance of the complainant or if the matter is such that which calls for investigation by a State agency, the ld. Magistrate may order registration of FIR u/s. 156 (3) Cr. P.C.
14. In a nutshell, case of the revisionist is that the respondents have not paid the balance amount of Rs. 9,94,886/- out of the total invoices amount of Rs. 42,94,846/-. It is not in dispute that the parties have entered into an services agreement on 24.06.2019 in pursuance of which the revisionist has started providing services and raised the aforesaid invoices. It is also not in dispute that Rs. 33 Lacs have already been paid by the respondents to the revisionist towards the services rendered by the revisionist.
15. It is settled law that to attract the offence of cheating u/s.
420 IPC, there must be dishonest and fraudulent intention from the very inception. In the present case, there is a written signed agreement between the parties and according to the agreement, the respondents have paid Rs. 33 Lacs to the revisionist towards the services, as such the dishonest and fraudulent intention cannot be presumed to be present at the time of inception of the agreement.
16. The status report filed by the Inquiry Officer reads as follows :
"During the course of inquiry, I gave notice to CR No. 81/2022 M/s. Advit Ventures Vs. M/s. GA Renewable Energy Pvt. Ltd Page No. 12 of 15 alleged Gaurav Ram Jhunjhunwala Director of M/s. GA Renewable Energy Pvt. Ltd. and he sent his reply through email mentioning therein that GA Renewable Energy Pvt. Ltd. hired Advit Ventures Pvt. Ltd. for the EPC work of Solar Power Plant of capacity 326 KWP at Sara Textiles Ltd. He further mentioned that number of reminders had been given to Advit Ventures Ltd. by email to do the pending work for processing of remaining payment but till date Advit Ventures never approached to complete the work. He further mentioned that plant designed by the Advit Ventures team and the warranty of material which had been used for designing is 5 years but GARPEL faced lot of technical issues in the plant which cause generation issues but Advit Ventures never support GARPEL to sort out the issues."
17. Given the fact that there exists a written signed agreement between the parties, the contents of which are not in dispute and also the fact that the respondents had paid Rs. 33 Lacs to the revisionist out of the claimed amount of Rs. 42,94,846/-, any dispute between the parties with respect to the remaining amount appears to be of commercial nature. In these circumstances, this Court is of the view that no police intervention is warranted in the facts and circumstances of the present case.
18. At this juncture, it is apt to refer to the observations made by the Hon'ble Supreme Court of India in Indian Oil Corporation vs. NEPC India Ltd., 2006 (6) SCC 736, which are as follows :-
"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 CR No. 81/2022 M/s. Advit Ventures Vs. M/s. GA Renewable Energy Pvt. Ltd Page No. 13 of 15 interests of lenders/creditors. Such a tendency is seen in several family disputes also, leading to irretrievable breakdown 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 through criminal prosecution should be depreciated and discouraged."
19. In G. Sagar Suri vs. State of U.P., (2000) 2 SCC 636, the Hon'ble Court has observed as under :
"...... It is to be seen if a matter, which is essentially of a 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 the 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."
20. A purely civil dispute arising out of a contractual relationship between the parties cannot be converted in a criminal offence in order to get favourable results. In the case of Hridaya Ranjan Prasad Verma v. State of Bihar, (2000) 4 SCC 168, the Court drew a distinction between the mere offence of breach of contract and that of cheating. It was observed as follows :
"15. In determining the question it has to be kept in mind that the distinction between mere breach of contract and the offence of cheating is a fine one. It depends upon the intention of the accused at the time to inducement which may be judged by his subsequent conduct but for this subsequent conduct is not the sole test. Mere CR No. 81/2022 M/s. Advit Ventures Vs. M/s. GA Renewable Energy Pvt. Ltd Page No. 14 of 15 breach of contract cannot give rise to criminal prosecution for cheating unless fraudulent or dishonest intention is shown right at the beginning of the transaction, that is the time when the offence is said to have been committed. Therefore, 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."
21. In the present case, the ld. Trial Court has rightly observed that the identities of suspects are known and the nature of allegations are not such which demand police intervention. The ld. Trial Court also rightly observed that no particular evidence needs to be unearthed and the transaction appears to be of purely business nature on the face of it. The ld. Trial Court had rightly dismissed the application u/s. 156 (3) Cr. P.C. of the revisionist.
22. No error, illegality or impropriety is found in the impugned order dated 01.12.2021 of the ld. Trial Court and the same is accordingly upheld.
23. Copy of this order alongwith TCR be sent to the ld. Trial Court for information and necessary action.
24. Revision file be consigned to Record Room.
SUSHIL Digitally signed
by SUSHIL ANUJ
Announced in the open ANUJ TYAGI
Date: 2023.09.06
Court on 06th September, 2023
TYAGI 15:27:44 +0530
(SUSHIL ANUJ TYAGI)
ASJ-04/Central/Delhi
06.09.2023(VR)
CR No. 81/2022
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