Allahabad High Court
Ram Chandra Prasad Keshri And Ors. vs The State Of U.P. And Anr. on 16 March, 2000
Equivalent citations: 2000CRILJ3047
Author: Ratnakar Dash
Bench: Ratnakar Dash
ORDER Ratnakar Dash, J.
1. Heard learned counsel for the applicants and the learned Additional Government Advocate for the State. None appears for the opposite party No. 2.
2. In this proceeding under Section 482, Cr.P.C. the order dated July 1st, 1996 of the learned Judicial Magistrate I, Etawah taking cognizance of the offence under Section 420, 406, I.P.C. is under challenge. The applicants (hereinafter referred to as the 'accused persons') are partners of the firm. M/ S. Keshari Traders, G.T. Road, Rajganj in the district of Hazari Bagh (Bihar) and they deal in consumer goods. Accused Ram Lakhan Prasad, one of the partners, it is alleged approached the complainant, opposite party No. 2 herein on 1-8-1995 and requested to supply five truck-load fo flour inducing him to believe that price would be paid on receipt thereof. Accordingly, the complainant sent flour on different dates, but received payment only in respect of the first consignment. He requested the accused persons to pay up the balance amount and the same having not been heeded to, led him to file the case which was registered as Complaint Case No. 175 of 1996. The learned Magistrate upon examination of the complainant and the witnesses was prima facie satisfied that a case under Sections 420 and 406, I.P.C. was made out and accordingly cognizance of the said offences.
3. Learned counsel appearing for the accused persons contended that a reading of the complaint as well as the statement of the witnesses including the complainant do not reveal that the accused persons had any intention to deceive the complainant so as to bring the case within the ambit of Section 420, I.P.C. So far as the Section 406, I.P.C. is concerned, he urged that even assuming the prosecution as true, it being not the case of the complainant that he had entrusted the goods to the accused persons which they dishonestly misappropriated or converted to their own use, no offence of criminal breach of trust can be said to have been made out against them. Lastly, he submitted that this being purely a civil dispute criminal proceeding was not maintainable and in support thereof he relied upon a decision of the Apex Court in the case of Nageshwar Prasad Singh alias Sinha v. Narayan Singh 1998 Cr R 625 : 1998 AIR SCW 4007.
4. With the assistance of the learned counsel for the accused persons as well as the counsel for the State I have gone through the complaint petition and the statement of the complainant recorded by the Magistrate. On facts, the question arises whether default of the accused persons to pay the balance price of the goods would make them criminally liable under Section 420, I.P.C. No doubt, the facts narrated in the complaint reveal that it was a commercial transaction between the parties but in my opinion, that cannot be sole reason to hold that no offence of cheating has been made out. The complainant, it is alleged, was deceived by accused, Ram Lakhan Prasad and was dishonestly induced to send five truck load of flour which he despatched on different dates. But payment was made only in respect of one consignment. This, prima facie shows that accused Ram Lakhan Prasad had dis-, honest intention from the very beginning not to make full payment of the price of the goods to the complainant. A similar case like the present one came up for consideration before the Apex Court in the case of Rajesh Bajaj v. State of U.P. (1999) 3 SCC 259 : AIR 1999 SC 1216, as to whether nonpayment of the balance amount in a commercial transaction would make one liable for cheating. In the said case, the grievance of the complainant was that he had supplied some garments to the accused, the Managing Director of a foreign company. The garments were received and the payment was promised to be made within a fortnight but when no payment was made a report was lodged to the police on the basis of which a case under Section 420, I.P.C. was registered. The accused approached the Delhi High Court seeking quashing of the criminal proceedings. The Court upon hearing found that there was nothing in the report to suggest that the accused had dishonest or fraudulent intention at the time of export of the goods and consequently quashed the proceedings. The complainant then moved the Apex Court and their Lordships in not agreeing with the view expressed by the Delhi High Court held that the commercial transaction or money transaction is hardly a reason for holding that the offence for cheating would allude from such a transaction and in fact many cheating were committed in the course of commercial and money transactions. The law laid down in Rajesh Bajaj (supra) has been reiterated in a latest decision in the case of Trisuns Chemical Industry v. Rajesh Agarwal (1999) 8 SCC 686 : AIR 1999 SC 3499.
5. The facts in Nageshwar Prasad Singh alias Sinha 1998 AIR SCW 4007 (supra) are some what different. In that case the accused was summoned to face a criminal charge under Section 420, I.P.C. The allegation against him was that he entered into an agreement for sale with the complainants in respect of certain property and delivered possession thereof to them, but subsequently he backed out from the agreement and did not execute the sale deed. According to complainants, the said act of the accused amounted to 'cheating' punishable under Section 420, I.P.C. It may be noted, simultaneously they also filed a suit for specific performance of contract. Taking all these facts into account, their Lordships held that the liability of the accused, if any arising out of breach of contract was civil in nature.
6. On a conspectus of the materials of the present case, I am of the opinion that a prima facie case under Section 420, I.P.C. is made out against accused Ram Lakhan Prasad. So far others are concerned, they have been arrayed as accused being partners of the firm M/s. Keshari Traders. Criminal law cannot be put into motion against them in absence of any material that they being partners of the firm had taken active part in inducing the complainant to supply the goods intending not to pay the price thereof. Therefore, the order of taking cognizance of the offence under Section 420, I.P.C. against them is unsustainable. With regard to the offence under Section 106, I.P.C. a reading of the averments made in the complaint does not show that the accused persons were entrusted with any property which they dishonestly misappropriated or converted to their own use so as to make them liable for the said offence. In that view of the matter, cognizance of the said offence taken by the learned Magistrate being bad in law has to be set at naught.
7. In the result, the criminal misc. case is allowed in part. The order of taking cognizance of the offence under Section 420, I.P.C. against accused Ram Lakhan Prasad, petitioner No. 3 is maintained and the rest part of the impugned order is quashed.