Calcutta High Court
Mahal Chand Sikwal vs State Of West Bengal And Anr. on 22 January, 1987
Equivalent citations: 1987CRILJ1569
JUDGMENT Monoranjan Mallick, J.
1. This is an application under Section 401 read with Section 482 of the Code of Criminal Procedure for quashed; the proceeding of Case No. C/66/86 under Section 403 of the Penal Code pending before the Metropolitan Magistrate, 11th Court, Calcutta. The facts are briefly as follows :
2. The opposite party No. 2 as complainant filed a petition of complaint before the learned Addl. Chief Metropolitan Magistrate, Calcutta on Feb. 22, 1986 against the present petitioner along with two others, inter alia, on the ground that the complainant and the accused petitioner along with other brothers started a partnership business in the year 1966 and the complainant opposite party regularly participated in the business up to 1978, but thereafter the complainant opposite party became sick and went to his native place, but when he came back in the month of Sep., 1985, he found that name of the partnership business has been changed and the petitioner has been running the said business by converting the said partnership into a ownership one without giving any share of the partnership business to the present opposite party. It was also alleged that though the accused petitioner and the other partners, being brothers, paid the present opposite party some token money as allowance, but that was much less than the actual share in the partnership business. The learned Additional Metropolitan Magistrate transferred the case to the Court of the Metropolitan Magistrate, 1lth Court, Calcutta, and who on examining the evidence of the complainant and his two witnesses issued process under Section 403 of the Penal Code against the present petitioner and Ors.
3. Being aggrieved by such issuing of process, the present application has been filed for quashed, the proceedings, contending, inter alia, that the learned Magistrate should not have issued process and should have considered the case to be of a civil nature for which no cognizance could be taken, that the learned Magistrate failed to consider that the alleged non-payment of share of the partnership business did not amount to any criminal act and such disputes can only be settled through a competent civil Court, that the complainant opposite party suppressed all the material facts, namely, that the partnership business was duly dissolved with the signature of the complainant and the complainant opposite party duly received his share of profit and that the petition of complaint not having disclosed any ingredient of the offence under Section 403 of the Penal Code further continuance of the proceeding is nothing but an abuse of the process of law and is liable to be quashed.
4. The revision has been contested by the opposite party complainant. Mr. Chatterjee, learned Advocate for the State has supported the case of the present applicant.
5. On behalf of the petitioner, a Division Bench judgment of this Court has been cited, being the case of Man Mohan Das v. Mahendra Bhewal AIR 1948 Cal 292. Their Lordships of the Division Bench have held that a partner cannot be prosecuted under Section 406 for withholding the share of the profits to which the other partner is alleged to be entitled, if it is not shown that he did not hold the property or receive the money in a fiduciary capacity. Learned Advocate for the petitioner has also referred to another Division Bench decision of the Allahabad High Court, namely, Sri Ram v. Parshadi LaL . In the said decision, the Division Bench of the Allahabad High Court has also held that even where the partner is found to utilise the firm's money for his own purpose, there can be no charge of criminal breach of trust to be levelled against such a partner.
6. On behalf of the opposite party, it is submitted that the petition of complaint has not only disclosed that the opposite party has been denied the share of the profit, but it has also been specifically alleged that the present applicant has converted the profits of the partnership business and started his own proprietary concern and that in view of the above, there were prima facie materials before the learned Magistrate to issue process against the present petitioner under Section 403 of the Penal Code. "It is further submitted that the defence of the petitioner that the partnership firm has been dissolved or that the present petitioner has paid up the share of the present opposite party as regards the partnership business on dissolution of the firm cannot be considered at this stage.
7. I am of the view that the contention of the opposite party that the defence of the petitioner herein that the partnership has been dissolved or that the opposite party has been paid all his dues cannot be taken up for consideration at the time while considering as to whether the petition of complaint disclosed any prima facie offence under Section 403 of the Penal Code or not. As to whether there has been a prima facie case established for issuing a process under Section 403, IPC has to be decided on the basis of the allegations made in the petition of complaint and the statements made in the initial Ejahar of the complainant and his witnesses. The documents, zerox copies of which have been produced by the present petitioner that the partnership firm has been dissolved or that payment has been received by the present opposite party in full discharge of his dues being disputed matters cannot be taken into consideration for quashing the criminal proceeding because such defence documents require proof and cannot be considered such clinching documents on the basis of which this criminal proceeding can be quashed.
8. I would, however, consider as to whether the contention of the present petitioner that the petition of complaint on the face of it discloses a prima facie case for issuing a process under Section 403, IPC or not.
9. There can be no doubt that the petition of complaint has been lodged by a partner of the partnership firm against the other partners alleging that the partners have not rendered proper account and that one of the partners has converted the partnership into an ownership business without rendering proper account. The Division Bench decision of this Court reported in AIR 1948 Cal 292 : 1948 (49) Cri LJ 543 has clearly held that the: partners are the joint owners of the partnership assets and each one is entitled to such part of the profits as on account would show is due to each partner, that one partner cannot sue another for his share of profits and if he desires to claim what he alleges is his due from the other partners, he must file a partnership suit and claim a dissolution of the partnership and an account and payment to him of what is found due on taking the ''account. The only sum due from one partner "to another is what is shown to be due to him after taking account of all the partnership transactions. Whether or not the partnership made a profit in a particular year can only be: ascertained on taking an account and it is only after taking such an account that it can be said that any sum whatsoever was due to the other party and it cannot possibly be a criminal offence to withhold payment in such circumstances. With these observations, the Division Bench have held that a partner cannot be prosecuted for converting to his own use the share of another partner in a partnership business. The above Division Bench decision is clearly on the point. The facts of the said case are similar to those of the present case. In the said decision, the prosecution was lodged against the other partner, under Section 406 of the IPC. In the present case, the prosecution has been lodged under Section 403 of the Code. But, in the ingredients of Section 406 of the Penal Code, there is the ingredient of criminal misappropriation. Therefore the Division Bench decision referred to above is clearly similar to the point in issue in the present case. There cannot be any charge of misappropriation against the partner until and unless there has been a proper account of the partnership business on the dissolution of the such business and until and unless, it is found that any sum is due from one partner to another. The opposite party does not allege in the petition of complaint that the partnership has been dissolved. So, on the face of the petition of complaint the partnership is still continuing. It is not known as to whether any share of profit will be due to the present opposite party and that cannot be ascertained without taking proper account. Therefore, at this stage no charge under Section 403 of the Penal Code can be levelled against the other partner even if the partner filing the criminal complaint alleges that the other partner has converted the partnership asset to his own use. The self same view has also been expressed in the Division Bench decision of the Allahabad High Court referred to in AIR 1982 All 60. There also it has been held that the partners using the firm money for their own use cannot be prosecuted for criminal breach of trust. In view of the above decisions I am of the view that the present criminal proceedings should not continue. It is nothing but an abuse of the process of the Court and must be quashed.
10. The revision petition be thus allowed. The criminal proceeding being case No. C/66/86 impugned herein be quashed.