Karnataka High Court
Panga Sudhakar Reddy vs The State Of Karnataka on 6 February, 2021
Author: H.P.Sandesh
Bench: H.P. Sandesh
1
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 06TH DAY OF FEBRUARY, 2021
BEFORE
THE HON'BLE MR. JUSTICE H.P. SANDESH
CRIMINAL PETITION No.6089/2020
BETWEEN:
PANGA SUDHAKAR REDDY,
S/O P. RAMA SUBBA REDDY,
AGED 49 YEARS,
PRESENTLY R/AT HOUSE NO.2,
5TH CROSS, VERSOVA LAYOUT,
C.V. RAMAN NAGAR,
BANGALORE - 560 093.
PERMANENT R/O 104,
ADITYA HILL PARADISE ROAD,
NO.69, NANDAGIRI HILLS,
JUBILEE HILLS, SHAIKP[ET,
HYDERABAD - 500 033. ... PETITIONER
(BY SMT. JAYNA KOTHARI, SENIOR COUNSEL FOR
SRI ROHAN KOTHARI, ADVOCATE)
AND:
1. THE STATE OF KARNATAKA,
THROUGH THE MAHADEVPURA
POLICE STATION,
REP. BY THE LD. PUBLIC PROSECUTOR,
HIGH COURT BUILDING,
BANGALORE - 560 001.
2. M. RAJASHEKAR REDDY,
S/O BRAHMA REDDY,
AGED 48 YEARS,
R/AT NO.B-39/2,
JUNIPERIAS STREET,
2
CALIFORNIA GARDENS,
ANANTAPURA, YELAHANKA - 560 064. ... RESPONDENTS
(BY SMT. NAMITHA MAHESH B.G., HCGP FOR R-1,
SRI SANDESH J. CHOUTA, ADVOCATE FOR
SRI G. NARASI REDDY, ADVOCATE FOR R-2)
THIS CRIMINAL PETITION IS FILED UNDER SECTION 482 OF
CR.P.C. PRAYING TO QUASH THE COMPLAINT DATED 24.09.2020
(ANNEXED AS ANNEXURE-B) AND FIR BEARING CR.NO.279/2020
REGISTERED AT MAHADEVPURA P.S., BANGALORE (ANNEXED AS
ANNEXURE-A) AND ALL PROCEEDINGS ARISING THERE FROM
PENDING ON THE FILE OF THE XXIX A.C.M.M., MAYO HALL,
BANGALORE INSOFAR AS THE PETITIONER HEREIN IS
CONCERNED.
THIS CRIMINAL PETITION HAVING BEEN HEARD AND
RESERVED FOR ORDERS ON 25.01.2021, THIS DAY, THE COURT
PRONOUNCED THE FOLLOWING:
ORDER
This petition is filed under Section 482 of Cr.P.C. praying this Court to quash the complaint dated 24.09.2020 and FIR bearing Crime No.279/2020 registered at Mahadevpura Police Station, Bengaluru, for the offences punishable under Sections 417, 420 and 506 read with Section 34 of IPC.
2. The factual matrix of the case is that the petitioner is an entrepreneur, primarily in the field of software development and consulting. The petitioner's software businesses are primarily oriented towards Customer Relations Management (CRM) and Business Intelligence (BI). The respondent No.2, 3 who is the complainant, in the complaint dated 24.09.2020, made the allegation against the petitioner that he is running 10- 12 Companies both in Hyderabad and Bengaluru and insisted the complainant to invest in partnership business and promised to pay 2% interest on the said amount and made the complainant to believe to invest the money. It is also alleged that he gave the amount from whatever he had saved in the contract business and also borrowed the loan from his sisters in 2016 and gave the amount of Rs.2,44,00,000/- by way of RTGS bank transfer. The petitioner herein having received the money developed the business and out of that amount, Rs.70,00,000/- was repaid. The transaction was taken place in front of Mahadevpura Phoenix Mall. Now the petitioner is in due to the tune of Rs.5 Crores. Though the petitioner developed the business by availing the loan from the complainant, he did not repay the amount and gave the reasons one or the other that he will repay the amount but did not repay. One month back, the petitioner called him and asked him to come near Phoenix Mall and accordingly he went and met him and he told that either himself or his brother are not due to any amount and also not received any amount. When the complainant insisted for payment of money, the 4 petitioner told that he will secure the rowdy elements and take his life. The said fact was brought to the notice of Sri Jayabhaskar Reddy and he also caused life threat. Hence, in the complaint a request was made to take action against the petitioner herein, who dishonestly induced him and caused life threat. Based on the complaint, the police have registered the case.
3. The petitioner in the petition would contend that the registration of the impugned FIR is without due regard to applicable law and has been carried out in a mechanical manner, without application of mind. The complaint is extraordinarily vague and do not make out any offence whatsoever against the petitioner. It is settled law that criminal process cannot be used for settling civil claims and there is no any prima facie material to register the case. The criminal liability cannot be vicariously attached in the absence of specific statutory power. The respondent No.1 by registering the impugned FIR has indulged in gross abuse of process of law. Even a cursory reading of the impugned complaint would disclose that no specific details relating to the subject-matter of the transaction have been 5 provided. Hence, prayed this Court to quash the registration of the FIR against the petitioner.
4. The learned counsel for the petitioner in addition to the grounds urged in the petition would submit that the contents of the complaint does not disclose any offences invoked against the petitioner. It is sheer abuse of process. The learned counsel in support of her arguments relied upon the judgment of the Apex Court in the case of SUSHIL SETHI AND ANOTHER v. THE STATE OF ARUNACHAL PRADESH AND OTHERS passed in Crl.A.No.125/2020 and brought to the notice of this Court paragraph No.7.2 of the judgment, wherein the Apex Court has held that every breach of contract would not give rise to an offence of cheating and only in those cases breach of contract would amount to cheating where there was any deception played at the very inception. The learned counsel referring this judgment would contend that there was no any deception played by the petitioner at the very inception. It is further observed that the complainant is required to show that the accused had fraudulent or dishonest intention at the time of making promise or representation. In the absence of a culpable intention at the 6 time of making initial promise, no offence under Section 420 of IPC can be said to have been made out.
5. The learned counsel also relied upon the judgment of the Apex Court in the case of PROF. R.K. VIJAYASARATHY AND ANOTHER v. SUDHA SEETHARAM AND ANOTHER passed in Crl.A.No.238/2019 and brought to the notice of this Court paragraph No.18 of the judgment. The Apex Court in the said judgment made an observation that the condition necessary for an act to constitute an offence under Section 415 of IPC is that there was dishonest inducement by the accused. No act on part of the appellants has been alleged that discloses an intention to induce the delivery of any property to the appellants by the first respondent. There is thus nothing on the face of the complaint to indicate that the appellants dishonestly induced the respondent to deliver any property to them. Cheating is an essential ingredient to an offence under Section 420 of IPC. The ingredient necessary to constitute the offence of cheating is not made out in the case on hand.
6. The learned counsel also relied upon the judgment of the Apex Court in the case of MANIK TANEJA AND ANOTHER 7 v. STATE OF KARNATAKA AND ANOTHER reported in (2015) 7 SCC 423. The learned counsel referring this judgment brought to the notice of this Court paragraph No.11 of the judgment with regard to invoking of Section 506 of IPC. Referring this judgment, the learned counsel would submit that the allegations made in the complaint does not indicate invoking of the ingredients of Section 506 of IPC. In order to invoke Section 506 of IPC, there must be a criminal intimidation.
"Criminal intimidation" would indicate that there must be an act of threatening to another person, of causing an injury to the person, reputation, or property of the person threatened, or to the person in whom the threatened person is interested and the threat must be with the intent to cause alarm to the person threatened or it must be to do any act which he is not legally bound to do or omit to do an act which he is legally entitled to do.
7. The learned counsel for the petitioner also relied upon the judgment of the Apex Court in the case of VIKRAM JOHAR v. STATE OF UTTAR PRADESH AND ANOTHER reported in (2019) 14 SCC 207. Referring this judgment, the 8 learned counsel brought to the notice of this Court paragraph No.23 of the judgment, wherein the judgment in the case of Manik Taneja (supra) was referred and reiterated that the threat must be with intention to cause alarm to the complainant to cause that person to do or omit to do any work. The learned counsel for the petitioner referring all these judgments would submit that it is a fit case to exercise the powers under Section 482 of Cr.P.C. or otherwise it amounts to abuse of process, which leads to miscarriage of justice.
8. Per contra, the learned counsel appearing for respondent No.2 would vehemently contend that the contents of the complaint clearly discloses that there was an inducement to invest the money and also the petitioner had agreed to pay the amount with interest. The petitioner neither repaid the amount nor paid the interest as promised and when the demand was made to repay the amount, threat was caused to the complainant. Hence, the complaint indicates both dishonest intention to make believe him to invest money and also life threat. The learned counsel would submit that the registration FIR cannot be interfered with and quashed at a premature stage. 9
9. The learned counsel for respondent No.2 relied upon the judgment of this Court in the case of YOGESH AGARWAL AND OTHERS v. STATE OF KARNATAKA AND OTHERS reported in MANU/KA/3290/2020 and brought to the notice of this Court that even though it is the allegation of investment and repayment of amount, the Court cannot quash the proceedings. If a case is having concurrent criminal and civil liabilities, there is no bar to initiate criminal proceedings as against the accused. The learned counsel would submit that in this judgment, this Court discussed in detail the scope of Section 482 of Cr.P.C. and comes to a conclusion that when it is specifically alleged that a criminal act has been committed, a fair investigation requires to be done. When both the remedies are available, one under the civil and another under the criminal law and allegations constitute an offence, then under such circumstances, it is not a case to quash the proceedings. It is further observed that it is trite law that on plain reading of the contents of the complaint, if no case is made out and the investigation and trail are not going to serve any purpose, then under such circumstances, the Court can quash the proceedings. 10
10. The learned counsel referring this judgment would submit that though non-payment of the amount is a civil right, the complaint is specific that an allegation is made against the petitioner that he made believe the complainant to invest the money with an intention to deceit the complainant and after the investment, he defrauded the complainant in not making the payment and when the demand was made, life threat was caused to the complainant. A serious allegation is made against the petitioner in the complaint and hence the registration of FIR based on the complaint which indicate prima facie case, cannot be quashed.
11. Having heard the submissions of the learned counsel for the petitioner and the learned counsel for respondent No.2, the petitioner has approached this Court to quash the FIR. The registration of the case by issuing FIR is only a law was set in motion and the Court has to look into whether the contents of the complaint discloses a prima facie offence and constitute an offence against the petitioner. Hence, I would like to make a mention in brief the contents of the complaint. 11
12. The respondent No.2, who is the complainant, in the complaint dated 24.09.2020, made the allegation against the petitioner that he is running 10-12 Companies both in Hyderabad and Bengaluru and insisted the complainant to invest in partnership business and promised to pay 2% interest on the said amount and made the complainant to believe to invest the money. It is also alleged that he gave the amount from whatever he had saved in the contract business and also borrowed the loan from his sisters in 2016 and gave the amount of Rs.2,44,00,000/- by way of RTGS bank transfer. The petitioner herein having received the money developed the business and out of that amount, Rs.70,00,000/- was repaid. The transaction was taken place in front of Mahadevpura Phoenix Mall. Now the petitioner is in due to the tune of Rs.5 Crores. Though the petitioner developed the business by availing the loan from the complainant, he did not repay the amount and gave the reasons one or the other that he will repay the amount but did not repay. One month back, the petitioner called him and asked him to come near Phoenix Mall and accordingly he went and met him and he told that either himself or his brother are not due to any amount and also not received any amount. 12 When the complainant insisted for payment of money, the petitioner told that he will secure the rowdy elements and take his life. The said fact was brought to the notice of Sri Jayabhaskar Reddy and he also caused life threat. Hence, in the complaint a request was made to take action against the petitioner herein, who dishonestly induced him and caused life threat. Based on the complaint, the police have registered the case.
13. Having read the contents of the complaint, the complaint is specific that the petitioner had approached the complainant and requested to invest the amount. In the complaint it is specifically mentioned that the petitioner made him to believe to invest the money and hence he invested the money. It is also an allegation that when the amount was not paid, the complainant was threatened not to insist for repayment of money and if he insisted for repayment of money, the petitioner would secure rowdy elements and take away his life and the said incident was taken place in front of Mahadevpura Phoenix Mall.13
14. Having considered the contents of the complaint, an allegation is made specifically that the petitioner made him to believe to invest the money and promised to make the payment and life threat is caused. No doubt, the principles laid down in the judgment is very clear that there must be a promise and the promise was also made with a dishonest intention. In the case on hand, specific allegation is made that after having got invested the money, the petitioner did not repay the money. Hence, specific allegation is made that the petitioner made the complainant to believe and to invest money with dishonest intention. This Court and the Apex Court has held that when both the criminal liability and civil liability are in existence, there cannot be an order under Section 482 of Cr.P.C.
15. The Apex Court in the judgment in the case of DINESHBHAI CHANDUBHAI PATEL v. THE STATE OF GUJARAT reported in 2018 (3) SCC 104, summarized the principles of inherent powers of High Court under Section 482 of Cr.P.C., in context of challenge to FIR. The Apex Court held that in order to examine as to whether factual contents of FIR disclose any prima facie cognizable offences or not, High Court 14 cannot act like an investigating agency and nor can exercise powers like an Appellate Court. The High Court also cannot appreciate evidence nor can it draw its own inferences from contents of FIR and material relied on. Once the Court finds that the FIR does disclose prima facie commission of any cognizable offence, it should stay its hand and allow the investigating machinery to step in to initiate the probe to unearth the crime in accordance with the procedure prescribed in the Cr.P.C.
16. The Apex Court in the judgment in the case of HDFC SECURITIES LTD. AND OTHERS v. STATE OF MAHARASHTRA AND ANOTHER reported in AIR 2017 SC 61 has held that the order directing investigation not causing an injury of irreparable nature, cannot be quashed at a premature stage.
17. Having considered the judgments relied upon by the learned counsel for the petitioner and the learned counsel for respondent No.2 and also the principles laid down in the judgments referred supra, it is clear that if the complaint discloses prima facie commission of an offence, which is cognizable in nature, the Court should stay its hand and allow 15 the investigating machinery to step in to initiate the probe to unearth the crime. In the case on hand, when specific allegation is made that the petitioner made the complainant to believe to invest the money with dishonest intention and after having got invested the money did not repay the amount and caused life threat, I am of the opinion that it is not a fit case to exercise the powers under Section 482 of Cr.P.C. and the same has to be used sparingly. If it is interfered with, it amounts to interfering at the premature stage.
18. In view of the discussions made above, I pass the following:
ORDER
(i) The petition is dismissed.
(ii) However, the petitioner is given liberty to approach this Court after filing of the charge-
sheet, if need arises.
Sd/-
JUDGE MD