Orissa High Court
M/S.Jindal India Thermal Power vs M/S. Quartz Infra & Engineering ... ... on 12 January, 2024
Author: D.Dash
Bench: D.Dash
IN THE HIGH COURT OF ORISSA AT CUTTACK
CRLREV No.226 of 2023 : (A)
AND
CRLREV No.320 of 2023 : (B)
In the matter of Revisions under section 397 read with
section 401 of the Code of Criminal Procedure, 1973 and from an
order dated 05.04.2023 passed by the learned Sub-Divisional
Judicial Magistrate, Talcher in 1CC Case No.33 of 2017.
CRLREV No.226 of 2023 (A)
M/s.Jindal India Thermal Power ... Petitioners
Limited & Others
-versus-
M/s. Quartz Infra & Engineering ... Opposite Parties
Private Limited & Others
CRLREV No.320 of 2023 (B)
M/s. Sinhotia Metals & Minerals ... Petitioners
Pvt. Ltd., West Bengal & Others.
-versus-
M/s. Quartz Infra & Engineering ... Opposite
Private Limited Party
Appeared in this case by Hybrid Arrangement
(Virtual/Physical Mode):
For Petitioners - Mr.S.P. Misra, Sr. Advocate
Mr. P.K. Rath, Sr. Advocate,
A.K. Dash & A. Mishra, Advocates
(In CRLREV No.226 of 2023)
Page 1 of 27
CRLREV Nos.226 & 320 of 2023
-2-
- Mr. Rajeet Roy, S.K. Mishra,
S. Sourav, T.P. Tripathy & A.
Mohanty, Advocates
(In CRLREV No.320 of 2023)
For Opposite Party - Mr.Vegesna Subha Raju,
(M.D. of O.P.-Company in person)
CORAM:
MR. JUSTICE D.DASH
Date of Hearing : 05.12.2023 ::: Date of Judgment :12.01.2024
D.Dash,J. Since in both these Criminal Revisions as at (A) and (B)
filed under section 397 read with section 401 of the Code of
Criminal Procedure, 1973 (for short, hereinafter called as 'the
Code'), the Petitioners have called in question the legality and
propriety of an order dated 05.04.2023 passed by the learned
S.D.J.M., Talcher in 1CC Case No.33 of 2017; those were heard
together for their disposal by this common judgment.
2. The Petitioner No.1 of the Revision as at (A) is the
Company, namely, M/s. Jindal India Thermal Power Ltd. (shortly
stated as M/s.JITPL) arraigned as accused No.1 in the complaint
filed by the Opposite Party-Company, namely, M/s.Quartz Infra
& Engineering Pvt. Ltd. (in short, M/s. QIEL), whereas the other
Petitioners are the Liason Officer & Ex-Director, the Liason
Officer, who too have been arraigned as accused persons in the
said complaint numbered as ICC No.33 of 2018.
Page 2 of 27
CRLREV Nos.226 & 320 of 2023
-3-
The Revision as at (B) has been filed by the Company,
M/s.Sinhotia Metals & Minerals Private Limited (in short, 'M/s.
SMMPL') and its two Directors, who too have been arraigned as
accused persons in the said complaint numbered as ICC No.33 of
2018.
3. For the sake of convenience, in order to avoid confusion
and bring in clarity, the parties hereinafter have been referred to
as their position has been assigned in the complaint petition filed
by the Opposite Parties (Complainant), i.e., M/s. QIEL.
4. Facts necessary for the purpose
The Complainant-Company, M/s.QIEL carries on the
activities of civil engineering and providing construction services.
The Complainant-Company had undertaken a back to back sub-
contract work from one M/s. GSR Ventures Private Limited to
execute the construction of a boundary wall as well as area
grading and leveling work sometime in the month of March, 2010
at the newly constructed 2 X 600 MW Thermal Power Plant of the
Company, M/s.JITPL, the accused No.4 situated at Derang known
as Derang Power Plant. The Complainant-Company, M/s.QIEL
entered into six Civil Engineering Work contracts with the
accused-Company-M/s.JITPL sometime between the month of
April, 2011 to February, 2012 for construction of peripheral roads
and drains, internal roads and drains, security sheds, boundary
Page 3 of 27
CRLREV Nos.226 & 320 of 2023
-4-
wall, raw water reservoir extension and execution of balance
work left in the Ash Dyke by M/s. GSR Ventures Private Limited
for the said Derang Power Plant.
For the purpose, the Complainant-Company, M/s.QIEL had
furnished three bank guarantees for a total sum of Rs.2.72 Crores
towards security/ earnest money as per the terms of the contract.
In December, 2012 the work relating to the construction of the
boundary wall was completed and the work of the construction
of the security shed was closed whereas the work pertaining to
the remaining four contracts, such as, construction of peripheral
roads and drains, internal roads and drains, raw water reservoir
extension and execution of the balance work left in the Ash Dyke
by M/s. VSR Ventures Private Limited were underway.
It is stated that the accused-Company M/s. JITPL
unilaterally terminated the contract on 31.01.2013 and the bank
guarantees furnished by the Complainant-Company, M/s.QIEL to
the tune of Rs.2.72 Crores were encashed on 29.01.2013 without
prior notice or intimation. The Complainant-Company, M/s.QIEL
was then asked to draw up the final bill after measurement of the
work done till 31.01.2013 and vacate the premises of Derang
Power Plant.
It is further stated that before terminating the contract, the
accused-Company, M/s.JITPL maliciously entered into an
Page 4 of 27
CRLREV Nos.226 & 320 of 2023
-5-
understanding with the Company, M/s.SMMPL, the accused
No.1 sometime in the month of December, 2012 to usurp the
work contract from the Complainant-Company, M/s.QIEL at that
Derang Power Plant at a much higher rate, compared to one
awarded to the Complainant-Company, M/s.QIEL.
5. The Complainant-Company, M/s.QIEL vehemently
objected to the manner of termination of the contract, which is
stated to be illegal. It is next said that this accused-company
M/s.SMMPL, having entered into the worksite, had illegally
kicked out the Complainant-Company, M/s.QIEL beyond the
arena, the Complainant-Company, M/s.QIEL was forced to accept
the words of the Officer of accused-Company-M/s.JITPL, who
assured that upon the assessment of the entire work done at the
site and measurement, the final bill would be processed within
nine (09) days of the meeting held on 06.02.2013 wherein it was so
resolved.
6. As a follow-up measure, a joint verification of the of work
done till 31.01.2013 as well as the measurement of the materials of
the Complainant-Company, M/s.QIEL lying in the store at
Derang Power Plant was conducted by the Officers of the
accused-Company-M/s. JITPL, Officers of another company
M/s.Quari and Brown as well as the Officer of the Complainant-
Company, M/s.QIEL. Upon measurement, the details were
Page 5 of 27
CRLREV Nos.226 & 320 of 2023
-6-
recorded in the Ground Level Books and all the above Officers
attested the same by putting their signatures. Accordingly, the
final bill of Rs.1.53 Crores was submitted which was duly
endorsed by the concerned Officers of accused-Company
M/s.JITPL. Subsequently, the Complainant-Company, M/s.QIEL
vacated the premises of Derang Power Plant. The accused-
Company, M/s.JITPL, thereafter made payment of Rs.92.25 lacs to
the Complainant-Company, M/s.QIEL but did not make further
payment of the rest amount of Rs.60.80 lacs as claimed by the
Complainant-Company, M/s.QIEL.
It is stated that despite repeated request for release and
payment of the said amount, the accused-Company M/s.JITPL
did not pay any heed to the same. So, the Complainant-
Company, M/s.QIEL had to invoke the Arbitration Clause as per
the contract.
7. During the Arbitral Proceeding, the Complainant-
Company, M/s.QIEL raised the issue of non-payment of the
residue amount as above said and further disputed the
termination of the contract as well as the encashment of the bank
guarantees as illegal. The Complainant-Company, M/s.QIEL on
going through the reply of the accused-Company-M/s.JITPL then
to his utter surprise learnt that the accused-Company M/s.JITPL
has forged and fabricated the documents and in the process
Page 6 of 27
CRLREV Nos.226 & 320 of 2023
-7-
altered the final bill and the ancillary twenty-nine Level Books
containing the measurement of the work in order to show that the
final bill stands around Rs.94.88 lacs. It is stated that the accused-
Company-M/s.JITPL had submitted the documents wherein they
themselves have contradicted the modified amount arrived at by
them and stated that the final bill was to the extent of further
reduced amount of Rs.92.25 lacs which has been fully paid.
It is alleged that the bill as well as ancillary documents were
forged, manipulated and fabricated and those were relied upon
by the accused-Company-M/s.JITPL to deprive the Complainant-
Company, M/s.QIEL of its lawful dues.
8. The learned Arbitral Tribunal, without delving upon the
allegations of forgery, manipulation and fabrication in its award
dated 21.02.2017 rejected all such objections and contentions
raised by the accused-Company-M/s. JITPL and awarded a sum
of Rs.9.71 Crores, which included the entire sum of Rs.1.53 crores
of the final bill, to the Complainant-Company, M/s.QIEL by the
accused-Company (M/s.JITPL)
9. Thereafter on 22.03.2017 the Complainant-Company,
M/s.QIEL filed four complaints arraigning several persons as
accused therein and we are here considered with the complaint
petition numbered as 1CC No.33 of 2017 wherein the accused
persons are the present Petitioners.
Page 7 of 27
CRLREV Nos.226 & 320 of 2023
-8-
10. Learned S.D.J.M., Talcher, embarking upon an inquiry
under section 202 of the Code, took cognizance of the offences
under sections 379/406/420/120-B/34 of the IPC and issued process
against these accused persons.
The accused persons thereafter carried an application under
section 482 of the Cr.P.C. to this Court seeking quashment of the
proceeding.
The said prayer was rejected by judgment dated 13.05.2022.
The Petitioners having carried the matter further to the Hon'ble
Apex Court have been unsuccessful.
11. The learned S.D.J.M. then sitting over the complaint has
recorded the pre-charge evidence tendered from the side of the
Complainant-Company, M/s.QIEL. On behalf of the
Complainant-Company, its Managing Director gave his evidence
and he too has been cross-examined at that stage by the accused
persons in exercise of their rights as per law. Thereafter an
application filed by these accused persons, for their discharge
under section 245(1) of the Code, having been rejected by the
impugned order, these Revisions have come to be filed.
12. In so far as the complaint petition numbered as 1CC Case
No.33 of 2017 is concerned, to be more specific the allegations are
that the accused-Companies M/s.JITPL and M/s. SMMPL have
misappropriated the properties of the Complainant-Company,
Page 8 of 27
CRLREV Nos.226 & 320 of 2023
-9-
M/s.QIEL, which were lying in the worksite of Derang Power
Plant for their benefits and thereby have made unlawful gain. It is
stated that for the purpose, the accused-Companies had colluded
and acted in connivance with each other in a concerted manner
hatching a criminal conspiracy to oust the Complainant-
Company, M/s.QIEL from the worksite. The accused-Companies
have forcibly entered the worksite of Derang Power Plant and
took over of the work of the Complainant-Company, M/s.QIEL in
a malfide manner behind its back. The accused-Company,
M/s.JITPL has also forced the Complainant-Company, M/s.QIEL
to sale its materials lying on the worksite to the accused-
Company M/s. SMMPL at a much lower rate than the acceptable
and payment towards the same was not made despite demands
on several occasions. It is thus stated that the accused persons
have dishonestly misappropriated the moveables of the
Complainant-Company, M/s.QIEL and have cheated the
Complainant-Company, M/s.QIEL while also committing
criminal breach of trust; they have colluded with each other to
cheat the Complainant-Company, M/s.QIEL so as to cause loss of
the property and have, therefore, committed the breach of
agreement.
13. Heard Mr. S.P. Mishra and Mr. P.K. Rath, learned Senior
Counsels for the Petitioners (accused-Company-M/s. JITPL and
Page 9 of 27
CRLREV Nos.226 & 320 of 2023
- 10 -
Others) of the Revision as at (A) and Mr. Rajeet Roy, learned
counsel for the accused-Company-M/s. SMMPL at length.
Mr. V.S. Raju, the Managing Director of the Complainant-
Company, M/s.QIEL, who appeared in person, was also heard.
I have perused the case records and the notes placed.
14. At the outset, at the risk of repetition, it be stated that the
impugned order relates to the rejection of the prayer advanced by
these accused persons for their discharge under sub-section 1 of
section 245 of the Code.
15. The present case has been instituted by the Complainant-
Company and the offences of which cognizance have been taken
are triable by following the procedures for trial of the warrant
cases. The procedures prescribed for trial of such cases are
contained in section 244 to 250 of the Code. In such warrant, case
arising upon a complaint instituted otherwise than in a police
report when the accused appears or is brought before the
Magistrate under section 244 (1) of the Code, the Magistrate is
called upon to hear the prosecution and take all such evidence as
may be produced in support of the prosecution. In that exercise,
the Magistrate may also issue summons to the witnesses also
under section 244(2) of the Code on an application by the
prosecution. All such evidence would stand as evidence before
charge. After such recording of the evidence is over, the
Magistrate as ordained under section 245(1) of the Code to
Page 10 of 27
CRLREV Nos.226 & 320 of 2023
- 11 -
consider as to whether any case against the accused is made out,
which if unrebutted would warrant his conviction. If the
Magistrate comes to the conclusion that there is no such case
made out against the accused, the Magistrate would discharge
the accused. On the other hand, if the Magistrate is satisfied that a
prima facie case is made out against the accused, the Magistrate
would frame charge under section 246(1) of the Code when the
Complainant would get the second opportunity to lead further
evidence in support of the charge and so also the accused would
then besides leading evidence would get further opportunity to
cross-examine the witnesses already examined at the pre-charge
stage with further opportunity to cross-examine the witnesses
examined during the pre-charge stage.
Therefore, under section 245(1) of the Code, the Magistrate
has the advantage of the evidence led by the prosecution before
him under section 244 of the Code. He has to consider whether if
the evidence remains goes unrebutted, the conviction of the
accused would be warranted. If there is no discernible
incriminating materials in the evidence, then the Magistrate
would be within its domain to discharge the accused under
section 245(1) of the Code.
16. The Magistrate under sub-section 2 of section 245 of the
Code has also the power to discharge the accused at any previous
stage of the case, i.e., before such any such evidence is lead.
Page 11 of 27
CRLREV Nos.226 & 320 of 2023
- 12 -
However, for discharging an accused under section 245(2) of the
Code, the Magistrate has to come to a finding that the charge is
groundless. In that exercise no question arises for consideration
of the evidence at that stage as no such evidence had by then
being taken. The Magistrate can take this decision before the
accused appears or is brought before this Court or the evidence is
lead under section 244 of the Code and that is what is clearly
borne out from the words "at any previous stage of the case"
which appear in section 245(2) of the Code which would be
obviously before the evidence of the prosecution under section
244(1) of the Code is completed or at any stage prior thereto.
The accused persons when had earlier carried an
application under section 482 of the Code before this Court for
quashment of the complaint, which was after the order by which
the learned S.D.J.M. had taken cognizance of the offences as
afore-stated; the stage was not the present as in our hand. The
consideration before the Magistrate at that earlier stage while
taking cognizance was as to whether there is sufficient ground for
proceeding by issuing process against the accused persons when
here the consideration stands as to if as per the evidence let in by
the Complainant-Company, a case is made out against the
accused persons and that remaining unrebutted, would warrant
their conviction.
Page 12 of 27
CRLREV Nos.226 & 320 of 2023
- 13 -
17. In case of Ajoy Kumar Ghose Vrs. State of Jharkhand & Another,
(2009) 14 SCC 115, the Hon'ble Apex Court has held:-
"41. Before we approach this question, we must
note that while Section 245(2) Cr.P.C. speaks about the
discharge of the accused on the ground that the charge is
groundless, Section 246(1) operates in entirely different
sphere. An order under Section 245(2) Cr.P.C. results in
discharge of the accused, whereas, an order under Section
246 Cr.P.C. creates a situation for the accused to face a
full-fledged trial. Therefore, the two Sections would have
to be interpreted in slightly different manner, keeping in
mind the different spheres, in which they operate. The
words "or at any previous stage of the case" appearing in
Section 246 Cr.P.C. would include Section 245 also,
where the accused has not been discharged under Section
245 Cr.P.C., while the similar term in Section 246(2) can
include the stage even before any evidence is recorded. It
cannot, therefore, be held that the words "at any previous
stage of the case" as appearing in Section 245 Cr.P.C.,
would have to be given the same meaning when those
words appear in Section 246 Cr.P.C.
The Bombay High Court, in a decision in Sambhaji
Nagu Vs. State of Maharashtra reported in 1979
Criminal Law Journal 390, has considered the matter.
While interpreting the words "at any previous stage"
under Section 246(1) Cr.P.C., the Learned Single Judge
in that case, came to the conclusion that the phraseology
only suggested that the Magistrate can frame charge,
even before "all" the evidence is completed under Section
244 Cr.P.C. Section 244 Cr.P.C. specifically mandates
that as soon as the accused appears or is brought before
the Court, the Magistrate shall proceed to hear the
prosecution and take all such evidence as may be
produced in support of the prosecution.
Page 13 of 27
CRLREV Nos.226 & 320 of 2023
- 14 -
Further, Section 245 Cr.P.C. also mandates that
"245. When the accused shall be discharged- (1) if,
upon taking all the evidence referred to in Section 244
Cr.P.C., the Magistrate considers, for reasons to be
recorded, that no case against the accused has been made
out which, if unrebutted, would warrant his conviction,
the Magistrate shall discharge him."
In Section 246 Cr.P.C. also, the phraseology is "if,
when such evidence has been taken", meaning thereby, a
clear reference is made to Section 244 Cr.P.C. The
Bombay High Court came to the conclusion that the
phraseology would, at the most, mean that the Magistrate
may prefer to frame a charge, even before all the evidence
is completed. The Bombay High Court, after considering
the phraseology, came to the conclusion that the typical
clause did not permit the Magistrate to frame a charge,
unless there was some evidence on record. For this, the
Learned Single Judge in that matter relied on the ruling
in Abdul Nabi Vs. Gulam Murthuza reported in 1968
Criminal Law Journal 303.
The similar view seems to have been taken in T.K.
Appu Nair Vs. Earnest reported in AIR 1967 Madras
262 and in re. M. Srihari Rao reported in AIR 1964
Andhra Pradesh 226. The similar view has been expressed
in P. Ugender Rao & Ors. Vs. J. Sampoorna & Ors.
reported in 1990 Criminal Law Journal 762, where it has
been expressed that previous stage is a stage, after
recording some evidence. It is neither a stage before
recording any evidence at all nor a stage after recording
the entire evidence, but is in between. The interpretation,
thus, placed on words "at any previous stage of the case",
occurring in Section 246(1) Cr.P.C. also appears to be
more in consonance with the order of the Sections
numbered in the Code and also with the heading given to
Section 246 Cr.P.C., viz., "Procedure where accused is
Page 14 of 27
CRLREV Nos.226 & 320 of 2023
- 15 -
not discharged". The very heading of the Section even
indicates that it would come into play only after the
matter is examined in the light of Section 245 Cr.P.C.
and the accused is not discharged thereunder. Therefore,
it is incumbent upon the Magistrate to examine the
matter for purposes of considering the question whether
the accused could be discharged under Section 245
Cr.P.C. and it is only when he finds it otherwise, he could
have resort to Section 246 Cr.P.C.
The Learned Single Judge in this ruling has also
noted another ruling by the same High Court in Abdul
Nabi Vs. Gulam Murthuza reported in 1968 Criminal
Law Journal 303 (cited supra). We, therefore, find that
consistently, the view taken by the High Court is that
there would have to be some evidence before the charge is
framed. In the last mentioned case of P. Ugender Rao &
Ors. Vs. J. Sampoorna & Ors. reported in 1990 Criminal
Law Journal 762, there is one incorrect observation in
respect of a decision of this Court in Cricket Association
of Bengal & Ors. Vs. State of West Bengal & Ors.
reported in 1971 (3) SCC 239 (cited supra) to the effect
that the Magistrate cannot discharge the accused before
recording any evidence, whatsoever, under Section 244
Cr.P.C. We have not been able to find out such an
expression in the aforementioned case of Cricket
Association of Bengal & Ors. Vs. State of West Bengal &
Ors. (cited supra). That was a case under old Section
253(2), which is pari materia to the present Section
245(1). On the other hand, the Court has very specifically
stated therein that Section 253(2) gives ample
jurisdiction to the Magistrate to discharge the accused in
the circumstances mentioned therein and the order of
discharge can be passed at any previous stage of the case.
It is further stated in Para 13 that sub-Section (1) under
those circumstances will not operate as a bar to the
Page 15 of 27
CRLREV Nos.226 & 320 of 2023
- 16 -
exercise of jurisdiction by the Magistrate under sub-
Section (2). Since we have found error in the above
mentioned judgment, we have mentioned so.
However, the ruling in Cricket Association of
Bengal & Ors. Vs. State of West Bengal & Ors. (cited
supra) also supports our earlier finding that the
Magistrate has the power to discharge the accused, even
before any evidence is recorded and thus, an application
for discharge at that stage is perfectly justifiable.
However, insofar as Section 246(1) Cr.P.C. is concerned,
we are of the clear opinion that some evidence would have
to be there for framing the charge.
There is only one judgment of the Andhra Pradesh
High Court in Verendra Vs. Aashraya Makers reported in
1999 Criminal Law Journal 4206, which has taken the
view that the Magistrate can frame the charge even
without any evidence having been taken under Section
244 Cr.P.C. We do not think that is a correct expression
of law, as the right of the accused to cross-examine the
witnesses at the stage of Section 244(1) Cr.P.C. would be
completely lost, if the view is taken that even without
Ajoy Kumar Ghose vs State of Jharkhand &
Anr. on 18 March, 2009 Indian Kanoon -
http://indiankanoon.org/doc/1735221/ 11 the evidence, a
charge can be framed under Section 246(1) Cr.P.C.
The right of cross-examination is a very salutary
right and the accused would have to be given an
opportunity to cross-examine the witnesses, who have
been offered at the stage of Section 244(1) Cr.P.C. The
accused can show, by way of the cross-examination, that
there is no justifiable ground against him for facing the
trial and for that purpose, the prosecution would have to
offer some evidence. While interpreting this Section, the
prejudice likely to be caused to the accused in his losing
an opportunity to show to the Court that he is not liable
Page 16 of 27
CRLREV Nos.226 & 320 of 2023
- 17 -
to face the trial on account of there being no evidence
against him, cannot be ignored.
Unfortunately, the earlier cases of the same Court,
which we have referred to above, were brought to the
notice of the Learned Judge. Again, the Learned Judge has
not considered the true impact of the clause "at any
previous stage of the case", which could only mean that
even with a single witness, the Magistrate could proceed
to frame the charge.
18. The provision is intended only to filter private complaints
and protect the accused from harassment. The test then of 'prima
facie' case has to be applied which means a case established by
prima facie evidence which in turn means evidence sufficient in
law to raise a presumption of fact in question unless rebutted.
The Magistrate is required to consider the evidence with a view to
framing prima facie case for conviction.
Keeping in mind, the allegations arising from out of the
contracts entered into between the parties in case of execution of
the works, it has to be borne in mind that simply because the
Complainant relates to commercial transaction or breach of
contract for which the civil remedy is available and being so
available has been availed of; that itself is no ground to discharge
the accused. The test is whether the evidence recorded at the pre-
charge stage discloses a prima facie case to presume that the
accused persons are guilty of commission of the offences and the
question of conviction would finally be decided on threadbare
Page 17 of 27
CRLREV Nos.226 & 320 of 2023
- 18 -
examination of the evidence as would stand recorded in the full-
fledged trial applying the tests of reliability and acceptability.
Under section 245(1), the Magistrate has the advantage of the
evidence led by the prosecution before him under section 244 of
the Code and he has to consider whether if the evidence remains
unrebutted the conviction of the accused would be warranted. If
there is no incriminating material in evidence, then the Magistrate
proceeds to discharge the accused under section 245(1) of the
Code.
19. In the case of Union of India Vrs. Prafulla Kumar Samal &
Another; (1979) 3 SCC 4; the Hon'ble Apex Court has held that the
words used in the context 'not sufficient ground for proceeding
against the accused show that the Judge cannot be assumed to be
a Post Office to frame the charges at the instruction of the
prosecution, and application of judicial mind to the facts of the
case is necessary to determine whether a case has been made out
by the prosecution for trial. In determining this fact, it is not
mandatory to drive into the pros and cons of the matter by the
Court.
There is a major distinction as regards discharge of an
accused from a warrant case instituted upon a police report and a
warrant case instituted upon a private complaint filed under
section 200 of the Code.
Page 18 of 27
CRLREV Nos.226 & 320 of 2023
- 19 -
20. In order to address on the question of the legality and
propriety of the impugned order, it is found that in the
touchstone of the above settled legal base, the learned S.D.J.M.
has refused to discharge the accused persons under section 245(1)
of the Code.
21. The narration of the facts constituting the commission of
offences are the followings:-
On 29.01.2013 when four numbers of contracts
awarded in favour of complainant company
were illegally terminated, Three Bank
Guarantees worth of Rs.2.72 crores were en-
cashed without notice to the complainant's
company and on 07.02.2013, when the properties
of the complainant worth of Rs.9.8 crores were
taken away and controlled and there was
restraint upon the Company for their entry into
the campus and prior to 30th January, 2013,
illegal award of the said two numbers of
contracts works out of four numbers of contract
works to accused M/s.SMMPL who were
allowed their free entry into the JITPL campus as
well as complement sites in that campus before
officially intimating the termination of contract
to the Complainant-Company.
22. First of all, it is stated that firstly the offence was committed
on 29.01.2013 when the contracts were terminated and the Bank
guarantees worth of Rs.2.72 crores were encashed; on 07.02.2013
the accused-Company, M/s.JITPL seized the properties of the
Complainant-Company, M/s.QIEL whose entry to the campus was
Page 19 of 27
CRLREV Nos.226 & 320 of 2023
- 20 -
restrained and on 30.01.2013 when the accused-Company M/s.
JITPL awarded two contract works out of the four to the accused-
Company M/s.SMMPL.
Further narrations stand that the accused-Company
M/s.JITPL being hand in gloves with two of its Liaison Officers and
one of whom was an Ex-Director unilaterally terminated the four
contracts and suddenly encashed the Bank Guarantees. It is next
stated that accused-Company-M/s.JITPL in collusion with those
above two accused persons illegally misappropriated the bank
guarantees worth Rs.2.72 crores for no justifiable reason breaching
the trust of the Complainant-Company, M/s.QIEL which it had
reposed on the accused-Company-M/s.JITPl. It is also stated that
the dominance of the accused-Company M/s.JITPL was misused by
willful coercive action in rejecting the contract encashing and
misappropriating the amount covered under the Bank Guarantees
and allowing the accused-Company-M/s.SMMPL and its two
Directors to do the work at the site where the Complainant-
Company, M/s.QIEL was executing the work without waiting for
the resolution of the dispute in terms of the Arbitration clause in
place in the contract executed between the Complaint-Company
and the accused-Company-M/s.JITPL.
Facts further narrated are practically the follow up actions to
the above that the accused-Company-M/s.JITPL inducted the accused-Company-M/s.SMMPL and its authorized agents, the two Page 20 of 27 CRLREV Nos.226 & 320 of 2023
- 21 -
Directors into the worksite and allowed them to do the jobs remaining incomplete which is stated to be in order to cheat and defraud the Complainant-Company, M/s.QIEL.
The other allegations remain with regard to illegal utilization of the materials worth of Rs.91.80 lacs belonging to the Complainant-Company, M/s.QIEL.
But then interestingly it is stated that the Complainant- Company, M/s.QIEL was forced to agree to sale the materials worth of Rs.91.80 lacs to the accused-Company-M/s.JITPL and thereafter part payment towards the same being made, rest amount of Rs.38.80 lacs was not paid despite several approaches.
23. It would be profitable at this stage to indicate that the Arbitral Proceeding stood concluded by passing of the award on 21.02.2017. The learned Arbitral Tribunal awarded a sum of Rs.9,71,06,938/- to be paid by the accused-Company-M/s. JITPL to the Complainant-Company with interest @18% per annum from the date of the award till actual payment. As per the order finally passed on 27.09.2023 by the Hon'ble Apex Court in SLP(C) No.19380 of 2023; the awarded amount has been paid and the full and final satisfaction to that effect has been recorded by the Executing Court on 19.10.2023 in the Execution Proceeding No.158 of 2017. Thus, the accusd-Company, M/s.JITPL has paid all the dues of the Complainant-Company of more than Rs.17.00 crores as Page 21 of 27 CRLREV Nos.226 & 320 of 2023
- 22 -
per the determination in the Arbitration Proceeding and subsequent final order of the Hon'ble Apex Court.
24. Admittedly, the Complainant-Company, M/s.QIEL during the recording of the evidence at the pre-charge stage has not tendered any documentary evidence in admitting any of those into evidence. In the Arbitral Proceeding no finding as regards the termination of the contract or encashment of the bank guarantees as tainted with mala fides or for the purpose of misappropriation has been given.
25. At paragraph 763 of the award, the learned Tribunal has stated the following:-
"The meeting dated 06.02.2013 took place after the termination of Contract. It was a Tripartite Agreement. The Respondent at best was working as a facilitator. It has not undertaken any vicarious liability to pay to the contractor any amount in the event the new agency namely M/s. Sinhotia failed and/or neglect to pay any amount towards the price of the Precast Tiles. The Tribunal is unable to agree with the submissions of the Claimant that the Respondent has made itself liable to pay the said amount in terms of the contract as new agency was introduced by the Respondent to the Claimant and the sale of materials took place only to benefit in advance their own works. The Claimant has not brought on record any material to show that the Respondent had undertaken any such responsibility. The rights and liabilities of the parties in the opinion of the Tribunal are contained in the minutes of meeting dated 06.02.2013 only."Page 22 of 27
CRLREV Nos.226 & 320 of 2023
- 23 -
26. The learned Tribunal at paragraphs 758 to 764 of its award has expressed its disagreement with the aforementioned contention of the Claimant therein, i.e., M/s.QIEL that by reason thereof accused-Company, M/s. JITPL had undertaken any liability/responsibility to monitor all the payments.
The contention of the Claimant, i.e., the Complainant- Company, M/s.QIEL was that the accused-Company-M/s.JITPL had taken the responsibility to monitor all payment transaction and that had undertaken the contractual obligation to see that the new entity (accused-Company-M/s.SMMPL) pay the entire bill amount to it.
27. In the minutes of the meeting dated 06.02.2023, it finds mention that the Complainant-Company, M/s.QIEL expressed their unwillingness to complete the work in other area as work in raw water reservoir and Ash Dyke had been uploaded.
28. The Managing Director of the Complainant-Company, M/s.QIEL in his evidence at the pre-charge stage has admitted that there was a clause for termination of his contract, i.e., Clause No.12.4 and that as per the said contract, the date of completion of aforesaid contract was scheduled to be on or before 28.02.2012 and that the said contract works were not completed by that date. He has again admitted that on 02.02.2013 he had issued one letter whose contents he admits to one Mr.Ashok Kumar Jain, Vice President (Head Civil), accused-Company-M/s.JITPL and therein Page 23 of 27 CRLREV Nos.226 & 320 of 2023
- 24 -
he has not mentioned the name of any of the Officers of the accused-Company-M/s.JITPL to have restrained him in any manner.
It has also been admitted by him that on 14.02.2013 he had issued one letter to accused Sunil Kumar Agrawal, the Liaison Officer and Ex-Director of the Accused-Company-M/s.JITPL wherein he had not indicated the role of the accused persons in selling the materials of the Complainant-Company, M/s.QIEL. Rather he admits to have written that he was asked to sale those materials. As per his evidence, he had handed over the Bank Guarantees to the accused-Company-M/s.JITPL for performance of the contract. He also admits to have filed no such document in any way hinting at the conspiracy as alleged to have been hatched by the accused persons.
29. It would also be pertinent to state here that the evidence of the said Managing Director of the Complainant-Company, M/s.QIEL is to the effect that when the work was in full swing, the accused-Company-M/s.JITPL in collusion with the accused- Company-M/s.SMMPL terminated the contract, encashed the bank guarantees and obstructed the Complainant-Company, M/s.QIEL to enter the worksite and by then the accused-Company M/s. JITPL had already inducted the accused-Company-M/s.SMMPL to start construction utilizing the materials of the Complainant- Company.
Page 24 of 27CRLREV Nos.226 & 320 of 2023
- 25 -
It is, however, next stated that meeting had been convened by the accused-Company, M/s.JITPL inside the premises of JITPL for settlement of the dispute. In the said meeting, accused- Company, M/s.JITPL along with with other accused persons agreed to pay for entire stock of sand and pre cast tiles as per the rate already mentioned amounting to Rs. 91.80 lacs. However, they have only paid Rs.53,00,000/- and remaining Rs.38.8 lacs was not paid despite several demand and they also denied to pay the said amount. He has accordingly stated that they misappropriated the said amount for their own purpose and illegal gain. His evidence is that the learned Arbitration Tribunal being approached; in its award the claim with respect to sand and pre cast tiles has been declined citing that the contract is a tripartite agreement. So it is said that the complaint petition was filed.
30. Having led the evidence as above at the pre-charge stage, the Complainant-Company, M/s.QIEL has expressed not to lead any further evidence at that stage and thus with such evidence has urged before the Court to proceed further by framing charge against the accused persons.
31. The learned S.D.J.M. having narrated the allegations and going through the Arbitral Award has expressed its agreement with the view of the learned Tribunal with such termination of contract by the accused-Company-M/s.JITPL at that stage appears Page 25 of 27 CRLREV Nos.226 & 320 of 2023
- 26 -
to be illegal. So, it is not on the basis of any evidence taken on record at the pre-charge stage.
32. It is next stated that, therefore, the accused persons need to prove their stand with regard to such termination of the contract and encashment of bank guarantees by adducing evidence which is not the relevant consideration to weigh in mind for the purpose. It has further stated that the amount in full has not been paid to the Complainant-Company. The views taken above are not deriving any support from the evidence recorded at the pre-charge stage. The evidence laid by the Complainant-Company, M/s.QIEL under section 244 of the Code as above even upon their acceptance in entirety do not make out a prima facie case against the accused persons in the direction of commission of offences so as to stand charged. All these do not appear to impute criminality upon the accused persons for their said actions giving rise to a dispute which having been raised in arbitration proceeding has been final followed by award of the amount which has been satisfied in entirety as per the final order of the Hon'ble Apex Court. This Court thus taking the evidence as available which have been referred to and touched upon on their face value and accepting all those as such records that no prima facie case against the accused persons for any of those offences is made out so as to frame charge for the noted offences in placing the accused persons to full- fledged trial.
Page 26 of 27CRLREV Nos.226 & 320 of 2023
- 27 -
33. In the wake of all the aforesaid, it is held that the order impugned in these Revisions is liable to be set aside. Accordingly, impugned order dated 05.04.2023 passed in 1CC Case No.33 of 2017 by the learned S.D.J.M., Talcher is set aside and the accused persons are discharged under section 245 (1) of the Code.
34. Resultantly, both the Revisions stand allowed. No order as to cost.
S/d-
(D. Dash) Judge True Copy P.A. Signature Not Verified Digitally Signed Signed by: HIMANSU SEKHAR DASH Reason: Authentication Location: OHC Date: 30-Jan-2024 15:48:35 Page 27 of 27 CRLREV Nos.226 & 320 of 2023