Delhi District Court
State vs . Sunil Trakru & Another on 30 November, 2013
State vs. Sunil Trakru & Another Unique ID No.02403R0843892008 FIR No.284/06 & 777/06 PS: Hazrat Nizamuddin (Investigated by Crime Branch) U/s 406/420/468/471/477A/120 B IPC 30.11.2013 ORDER ON CHARGE 1. The present prosecution was launched on a complaint made by complainant Sh. K.S. Kler to Sh. V.K. Duggal, the then Home Secretary, Ministry of Home Affairs, Govt. of India, New Delhi against Sachin Taneja and Sunil Trakru for cheating him to the tune of more than rupees two crores. On the said complaint, a case bearing FIR No. 284/2006 under Sections 406/420/468/471/120B IPC was registered and investigation was handed over to SI Anil Kumar. 2. However, during the course of investigation, complainant had also got another case vide FIR No. 777/06 registered at PS Nizamuddin by making a complaint to SHO PS Hazrat Nizamuddin against accused Sachin Taneja, Sunil Trakru and one Rakesh Jain, accountant of the company on the same allegations against the same accused, and the same was transferred to EOW and was also entrusted to SI Anil Kumar. FIR No.284/06 State v. Sunil Trakru 1/44 3. Brief facts, as recapitulated from both the complaints, are that M/s Modular Pvt. Ltd. was a company registered under the Companies Act and was dealing in the business of construction. Mr. Sunil Trakru and Mr. Sachin Taneja were the Directors of the said company. Both Sachin Taneja and Sunil Trakru had entered into a criminal conspiracy and with dishonest intention approached the complainant and had induced him to join their company as a Director since the complainant was having rich experience in the field of construction. On 31.10.2003 on the dishonest inducement of the accused persons, complainant had become one of the Directors with a 40% share in the said company whereas the accused persons were left with the remaining 60% shares of the said company and had a share holding of 30% each after 31.10.2003. It has been further alleged that in the month of December 2003, they had taken a sum of Rs. 14.00 lacs from the complainant to invest the same in business with a promise to return the same but they had never returned the same. It has been further alleged that complainant was the Power of Attorney holder of property No. R115, GKI, New Delhi. In the month of February 2004, both the accused persons had induced him to sell the property to the company at a reasonable price with a false promise that at the time of its subsequent sale, the complainant and his wife would be FIR No.284/06 State v. Sunil Trakru 2/44 given 60% of the sale proceeds and in this regard a MOU dated 12.2.2004 was also entered between them. However, with dishonest intention and in order to cheat the complainant, both the accused had sold the property secretly and had showed the sale price as Rs. 1.10 crore whereas the market value of the said property was Rs. 3.5 crores. Both of them had misappropriated over Rs. 2.4 crores which they had received in cash and did not show the said amount in the sale. He further alleged that in their own letter written to the complainant, the accused had admitted a buyer for the said property for Rs. 1.70 crore to which the complainant had not agreed. 4. It has been further alleged that in order to generate the funds, the accused persons had induced the complainant to mortgage his property bearing No. G33, Kalkaji with State Bank of Travancore, Karol Bagh, New Delhi in order to avail the cash credit facility from the bank to the limit of Rs. 1 crore. The said property was jointly owned by wife and daughters of complainant. However, the intention of the accused persons was to cheat the complainant. It was understood that Mr. Sunil Trakru and Mr. Sachin Taneja would also likewise mortgage their property with the bank but only Mr. Sunil Trakru had created a personal security of his property S480, Flat No. 4, FF. Greater Kailash - II, New Delhi - 48. Subsequently, the complainant got to know that Mr. Sunil Trakru and Mr. FIR No.284/06 State v. Sunil Trakru 3/44 Sachin Taneja were not being honest in their dealings vis a vis M/s Modular P. Ltd. and were in fact siphoning off funds of the company and were letting the bank liabilities mount. Complainant had also informed the bank in this regard on 4.8.2005 and even prior to it, correspondences were also exchanged. He had further alleged that the complainant had come to know that Mr. Sunil Trakru and Mr. Sachin Taneja in connivance and in criminal conspiracy with their accounts manager Mr. Harinder Kumar Mishra and their chartered accountant Mr. Rakesh Jain, in order to cheat the complainant, and to cause wrongful loss to the complainant and his wife and daughters whose property was mortgaged with the bank, had opened two new bank accounts in the name of M/s Modular P. Ltd. , one bearing A/C No. 2219 with Central Bank of India, Nizamuddin West Branch and another A/C No. 1324500001518 with HDFC Bank, Defence Colony Branch, New Delhi. He had also raised suspicion that there might be other accounts in other banks as well. He had further alleged that accused persons in connivance with each other had siphoned off/diverted funds of the company to the above mentioned accounts and had withdrawn the same for their personal gain and thus had caused wrongful loss to the complainant who was 40% share holder in the company and had also caused wrongful loss to the company as well. In this way, they had also permitted the liabilities of the company to accumulate with the State Bank FIR No.284/06 State v. Sunil Trakru 4/44 of Travancore. He had further alleged that accused persons had fraudulently withdrawn Rs. 1.18 crore approximately from account of Central Bank of India after receiving the same from various parties. The said account was closed by the accused persons on 25.11.2005. It has been further alleged that the accused persons had cheated the complainant, his wife and daughters by making them wholly and solely liable to the bank as only their property had been mortgaged with State Bank of Travancore. The bank had been sending the recovery notices of the loan amount taken by the company to them against their mortgaged property and was also threatening to sell out the property. He had further alleged that the complainant had also been fraudulently removed from the Directorship of the company by the accused persons. The complainant had further alleged that the accused persons were habitual offenders and had requested for taking action against them. 5. During investigation IO had seized various documents from the complainant i.e. MOU dated 12.2.2004, understanding/undertaking dtd. 12.2.2004, agreement dated 6.7.2004, MOU dated 20.10.2004, letter dated 04.11.2004 regarding share application money and allotment of shares, original minutes of board meeting held on 20.4.2005. During investigation it had been discovered that as per MOU dated 12.2.2004, sale proceeds of property bearing No. R115, GKI, Delhi FIR No.284/06 State v. Sunil Trakru 5/44 (which was in process of acquisition) was to be shared as 60%, 20% and 20% among the complainant, Sachin Taneja and Sunil Trakru, respectively. As per understanding/undertaking dated 12.2.2004, the complainant, Sachin and Sunil Trakru had bounded themselves not to sell or encumber or create any third party interest in the properties owned by them without written consent of Mr. K.S. Kler until such time as Mr. K.S. Kler's property bearing No. G33, Kalkaji was released and a discharge signed by Mr. K.S. Kler was given in writing. Profit and losses liability of company after 31.10.03 (i.e. the date of joining of Mr. K.S. Kler as a Director) was to be shared 40%, 30%, 30% amongst Mr. K.S. Kler, Schin Taneja and Sunil Trakru respectively. Losses and profits prior to 31.10.2003 were the entire responsibility of Sachin Taneja and Sunil Trakru. As per agreement dated 6.7.2004, Mr. K.S. Kler, Sachin Taneja, Sunil Trakru were having 40%, 30%, 30% share holding in the company M/s Modular P. Ltd. and Mr. K.S. Kler had obtained his share holding only on 1.10.2003. Prior to this, Sachin Taneja and Sunil Trakru were having equal share holdings. There were already old liabilities of the company before joining of Sh. K.S. Kler as a Director and present liability of company as on 15.6.2004 was approx. Rs. 35 lacs. In order to inject FIR No.284/06 State v. Sunil Trakru 6/44 funds into the company, Mr. KS Kler had also furnished his personal property i.e. G33, Kalkaji by way of a collateral security to SBT Karol Bagh for advances and overdraft facilities. However, accused Sachin Taneja and Sunil Trakru had thereafter purchased W118, Ground Floor, Greater Kailash II, New Delhi and S480, FF, GKII New Delhi respectively in their own names subsequently after raising of funds despite the fact that all old liabilities of the company as on 15.6.2004 to the tune of Rs. 35 lacs were the responsibility of Sachin Taneja and Sunil Trakru and Mr. K.S. Kler was not responsible for any of the said liability. Sachin Taneja and Sunil Trakru were also supposed to offer their respective properties i.e. W118, Ground Floor, Greater Kailash II, New Delhi and S480, FF, Greater Kailash - II, New Delhi as collateral security against the financial help extended to the company by Mr. K.S. Kler. In MOU dated 20.10.2004 Sh. K.S. Kler, Sachin Taneja and Suni Trakru were shown as promoter directors of the company having contributed in the ratio of 40:30:30 in the share capital of the said company and had availed working capital facilities to the tune of Rs. 1 crore from SBT, Karol Bagh, New Delhi on 24.11.03. It was however agreed by and between Mr. K.S. Kler, Sachin Taneja and Sunil Trakru to mortgage the following properties to SBT, Karol Bagh to secure existing loans : S480, GKII, New Delhi, W118, GKII, New Delhi and R115, GKII, New FIR No.284/06 State v. Sunil Trakru 7/44 Delhi. It was further agreed that SBT Karol Bagh would also be requested to release the mortgage property G33, Kalkaji which was in the name of Mrs. Bhupender KS Kler, Ms. Jaspreet Kaur Kler and Ms. Navneen Kler Chawla. As per letter dated 4.11.2004 regarding share application money and allotment of shares, it had been revealed that this letter was written by the complainant to Managing Director of Modular P. Ltd. and was duly received by the other director Sunil Trakru. In the said letter it was found mentioned that the complainant's share holdings were to be increased to 40% of total equity share of the company. Thus, total equity amount of the complainant came out to be Rs. 4 lacs, as authorized equity share capital of the company as on date was Rs. 10 lacs. The complainant had given details of the above money of the Rs. 4 lacs against allotment of 40% share holdings which is as under: Ø Money already paid for one equity share : Rs. 100/, Ø Money already paid in financial yr 200304 : Rs. 1,06,000/, Ø A cheque of HSBC Bank for : Rs. 1,00,000/, Ø Request for adjusting the balance from : Rs. 1,93,000/ salary of the complainant. Thus the complainant had justified this amount of Rs. 4 Lacs for allotment of 40% share holdings in his name. FIR No.284/06 State v. Sunil Trakru 8/44 As per original minutes of board meeting held on 20.04.2005, the company had decided to sell out the property bearing No. R115, GKI, New Delhi. This board resolution was having signatures of two directors only namely Sachin Taneja and Sunil Trakru. Name of complainant Mr. K.S. Kler with designation as Chairman though existed in the records but was without his signatures. 6. All the above documents were sent for expert's opinion and GEQD vide his report No. CX529/2006 dated 4.1.2007 had opined that all the above documents including MOUs etc. were having signatures of complainant and accused directors Sachin Taneja and Sunil Trakru. Thus, from the GEQD opinion it was evident that following points were not denied by both the accused Directors: Ø Complainant was promised 40% share holding in the company and complainant had also obtained the same on 1.10.2003 as per MOU dated 6.7.2004. Ø 60% of the sale proceeds of property bearing No. R115, GKI, New Delhi was to be given to complainant Mr. K.S. Kler. Ø Mr. K.S. Kler, Sachin Taneja and Sunil Trakru were the promoter directors of the company as per MOU dt. 20.10.04. Thus on 20.10.04, Mr. K.S. Kler was a director in the said company. Ø There were old liabilities on the company before joining of Mr. K.S. Kler as a Director and liability of the company as FIR No.284/06 State v. Sunil Trakru 9/44 on 15.6.2004 was approx. Rs. 35 lacs and the same was to be shared only by the accused directors Sachin Taneja and Sunil Trakru. 7. During investigation it was further revealed that appointment of Mr. K.S. Kler as Additional Director was done purposely by the two accused Directors Sachin Taneja and Sunil Trakru with an ulterior motive as there were old liabilities on the company at that time. The complainant was shown a rosy picture to the fact that he would be offered 40% share holding in the company and thus he was induced to mortgage his property G33 Kalkaji, Delhi for arranging funds for an already indebted company. Further the accused had induced the complainant to sell the property bearing No. R115, GKI, Delhi to the company with a false promise of 60% of subsequent sale proceeds of the said property. Complainant had thus sold this property to company for a sale consideration of Rs. 60 lacs only. It was revealed during investigation that Modular P. Ltd. was registered with ROC vide Regn. No. 12050 on 23.07.1981 with Promoter Directors namely Sh. Balraj Taneja and Rajender Taneja and its main business was of builders and constructions. The company was handed over by Mr. Balraj Taneja to his son Mr. Sachin Taneja who had joined as Director on 16.12.1988. Accused Sunil Trakru had joined as Director on FIR No.284/06 State v. Sunil Trakru 10/44 17.02.1992. Sh. K.S. Kler was appointed as Additional Director on 28.10.2003. The complainant was shown a rosy picture to the fact that he was to be offered 40% share holdings in the company and thus he was induced to mortgage his property G33, Kalkaji, Delhi for arranging funds for an already indebted company. Further, the accused directors had induced the complainant to sell a property bearing no. R115, G.K.I, Delhi to the company with a false promise of 60% of subsequent sale proceeds of that property. Believing the above representations of the accused Directors Sachin Taneja and Sunil Trakru to be true, the complainant had mortgaged his property G33, Kalkaji, Delhi with SBT Karol Bagh and had arranged OD facilities of Rs.1 Crore, which was being owned by the wife of the complainant namely Mrs. Bhupender Kaur and his two daughters namely Ms. Jaspreet Kaur Kler and Ms. Navneet Kler Chawla. The complainant was further shown a rosy picture that he was appointed as Principal Joint Signatory with one of the other Directors for withdrawal the money from the above bank and Board Resolution dated 11.11.2003 was also passed in this regard. It has been further revealed during investigation that property no. R115, G.K.I was being owned by Sri Niwas Ram Prasad an NRI and he had made the complainant his GPA Holder on 15.11.2003 to dispose of FIR No.284/06 State v. Sunil Trakru 11/44 the said property. Prior to this, the complainant had already joined M/s Modular Pvt. Ltd., as a Director on 28.10.2003 and he was induced to sell the said property to the company on the false promise of 60% of subsequent sale proceeds. Even a MOU dated 12.02.2004 was also executed in this regard by the accused Directors Sachin Taneja and Sunil Trakru and signatures of both accused directors on the said MOU were duly confirmed by GEQD. Thus, on the above false assurance of 60% of sale proceeds, complainant had sold this property to the company for a consideration of Rs.60 lacs. This amount was arranged by way of finance/loan from City Bank by mortgaging the following properties: Rs.53 lacs. This loan was availed by mortgaging property bearing no. R115, G.K.I, New Delhi itself. Rs. 15 lacs. This loan was availed by mortgaging property bearing no. W118, G.K.II, New Delhi of Sachin Taneja. It has been further revealed that accused persons had succeeded in their illegal design and they had not only removed the complainant from directorship on 30.9.2004 but also had disposed of this property at a cheaper price of Rs. 1.10 crore to accused Rakesh Jain on 13.6.2005. It is pertinent to mention here that two tenants namely Sh. Mukul Gupta and Sh. Madhu Sudan were already residing in the above premises and they were paid Rs. 10 lacs each for getting the vacant FIR No.284/06 State v. Sunil Trakru 12/44 possession by the present owner Rakesh Jain. Despite that the sale price of Rs. 1.10 crores was stated to be cheaper on the following grounds: i) Valuation report bearing No. DKN/City/06/12/2003 dt. 06.12.03 of Approved Valuers Sh. D.K. Nagpal and Associates, 115, South ExPlazaII, Delhi for valuing the worth was got done by City Bank for the purpose of releasing loan and they had valued the worth of this property Rs.2,16,81,000/. ii) Valuation report dt. 8.12.03 of Satish Kumar c/o Intarch Services P. Ltd., 54 Malcha Marg, Chanakyapuri, New Delhi was got done by Citi Bank for the purpose of releasing loan and valuing worth of Rs. 1.65 - 1.75 crores for free unencumbered property with vacant possession and Rs. 7075 lacs lesser for an encumbered property with old tenants. iii)As per reply dt. 20.12.05 of State Bank of Travancore, Karol Bagh it has been submitted that the Company 'Modular P. Ltd.' vide letter dt. 17.02.04 had requested the bank to consider new loan of Rs. 60 lacs as well as to release property bearing No. G33, Kalkaji after replacing it with above property R115, GKI. Thus company itself was valuing worth of this property more than Rs. 1.60 crores in Feb. 2004. FIR No.284/06 State v. Sunil Trakru 13/44 iv)Valuation report dated 13.8.05 of approved valuer Sh. Rameshwar Dayal C/o Dayal & Associates K58, Old Roshanpura, Nazagarh, New Delhi valuing the worth of this property as Rs. 3.57 crores. v) As per the Arbitrator Sh. Ravi Nath notesheet dt. 5.3.05 "both the directors i.e. Sachin Taneja and Sunil Trakru had categorically admitted that they could not find anyone ready to pay more than Rs. 1.70 crores for the above property and if acceptable to complainant Mr. K.S. Kler, this property could be sold for Rs. 1.70 crores." But Mr. K.S. Kler had not given his consent to dispose of this property at this cheaper price. Still to achieve their ill designs, the accused Directors had prepared a board resolution dt. 20.4.05 under their signatures wherein it was mentioned that company had decided to sell the above property. Surprisingly, this resolution was showing Mr. K.S. Kler as Chairman and GEQD report confirmed that the name of Mr. K.S. Kler as Chairman was appeared to be produced in the same process of printing of rest of the contents of the letter. But before this board resolution, the complainant was already removed from the post of Directorship on 30.9.04. thus, removal of complainant from the post of Directorship on 30.9.2004 was doubtful due to following reasons. FIR No.284/06 State v. Sunil Trakru 14/44 a) MOU dt. 20.10.04 signed amongst Mr. K.S. Kler and Sachin Taneja and Sunil Trakru was showing Mr. K.S. Kler as a director and GEQD report also confirmed the signature of complainant and two accused Directors Sachin Taneja and Sunil Trakru on this MOU. b) Complainant had written a letter dt. 4.11.04 regarding allotment of shares to him and it was received by the other accused Directors Sunil Trakru but besides it, Mr. K.S. Kler was not informed about his removal from Directorship. c) Board of Director's Minutes dt. 26.11.04 for taking loan of Rs. 5.5 lacs from ICICI Bank had shown Sh. K.S. Kler as a director. d) Removal of Sh. K.S. Kler from directorship was not informed to State Bank of Travancore, Karol Bagh, Delhi where he was a Principal Joint Signatory. It is pertinent to mention that State Bnk of Travancore, Karol Bagh vide its reply dt. 24.06.06 had denied that Bank was informed on 8.1.05 about removal of Mr. K.S. Kler from the Directorship. e) State Bank of Travancore, Karol Bagh was informed regarding removal of Mr. K.S. Kler as Director on 26.7.05. FIR No.284/06 State v. Sunil Trakru 15/44 f) Information regarding removal of Mr. K.S. Kler from directorship on 30.9.04 was given to ROC on 4.2.05. g) Board Resolution containing Board of Directors Minutes dt. 20.4.05 regarding sale of property No. R115, GKI was having signatures of accused Directors Sachin Taneja and Sunil Trakru. It is pertinent to mention that this resolution contained the name of Mr. K.S. Kler in the capacity of Chairman and GEQD report opined that "name of KS Kler (Chairman) appears to be produced in the same process of printing of remaining contents of the letter." As such removal of Mr. K.S. Kler from directorship on 30.9.04 was not correct. Had it been so, his name in the capacity of Chairman would not have been there on the above board of director's resolution dt. 20.4.05. 8. Thus the accused Directors had not only unauthorizedly removed the complainant from the directorship but also had disposed of the property bearing No. R115, GKI at a cheaper price of Rs. 1.10 crores. However, to show their bonafides, the accused directors had deposited the sale proceeds of R115, GKI, New Delhi in the following bank and their details are as under: State Bank of Travancore, : Rs. 43,09,346/ Karol Bagh, Delhi. FIR No.284/06 State v. Sunil Trakru 16/44 Citi Bank : Rs. 66,90,654/ 9. Accordingly, loan of Citi Bank was cleared in June, 2004 and dues of SBT Karol Bagh were still pending where property of Mr. K.S. Kler still stood as collateral security. From the perusal of records of SBT Karol Bagh it was revealed that still an amount of Rs. 46,10,155 stood on 14.11.05 against the company. Later on the accused persons had approached the Hon'ble High Court and they were granted regular bail vide order dated 8.2.07 with the following conditions: 1. The accused will deposit a surety of Rs. 50 lacs either by way of bank guarantee/fixed deposit/property documents. 2. The accused shall not leave the country without permission of the concerned court. 10. In the meantime, instead of depositing Rs. 50 lacs as per the orders of Hon'ble High Court, the accused directors discharged the entire liability of SBT, Karol Bagh on 1.3.07 and thus the property bearing No. G33, Kalkaji of the complainant was set free later on by the Bank. Presently the property of the complainant had been released by the bank. Thereafter, the accused persons had sought modification of the above bail order dt. 8.2.07 and the same was also allowed by the Hon'ble High Court vide order dt. 16.4.07, wherein security of Rs. 50 lacs was reduced to Rs. FIR No.284/06 State v. Sunil Trakru 17/44 15 lacs and the same was duly complied by way of bank guarantee by the accused persons. 11. It has been further revealed that the funds of Modular P. Ltd. were siphoned off as the property bearing no. 18, Sr. Mall MG Road Gurgaon was purchased by accused Sachin and Sunil in the name of Modular Constructions (another firm) and payment was made through pay order amounting to Rs. 36,73,275/ for the above shop was paid through adjustment of amount due to Modular P. Ltd. pursuant to letter of Modular P. Ltd. dt. 26.11.05 that all payments due to it be made to Modular Constructions. A pay order amounting to Rs. 20,39,467.89 was also got prepared from SBT, Karol Bagh on the date of opening of said account itself on 24.11.03 and was credited in the CC account No. 2095 already maintained by the accused in the name of Modular Pvt. Ltd. with Central Bank of India, Hazrat Niamuddin Branch which account was also closed by them on the very same day i.e. 24.11.03 after crediting of the said draft. The funds of SBT Karol Bagh appears to have been used by the accused Sachin and Sachin for compensating the liability of company having no concern with the present complainant. 12. As per Annual return filed by the accused persons before ROC on 21.11.05, it was revealed that out of 10,000/ shares of the FIR No.284/06 State v. Sunil Trakru 18/44 company of value of Rs.100/ each, only 5851 shares were allotted in the following manner: 1. Sachin Taneja2950 2. Sunil Trakru2950 3. K.S. Kler1 Form 2 regarding allotment of 3999 shares of Rs.100/ each to Sh. K.S. Kler was filed by him before ROC on 10.05.05 by Sachin Taneja for which an amount of Rs. 399900/ was to be received from Sh. K.S. Kler. 13. Further an amount of Rs. 1,06,819/ which was payable to complainant Mr. K.S. Kler as per books for the year ending on 31.3.04 was cleared in the books of the company during the year 200405. It is pertinent to mention that this amount was credited on account of payment to be made by him to Asian Motors towards purchase of car. These compiling accounts were prepared after order dt. 5.3.05 of Arbitrator Sh. Ravi Nath. In those accounts papers, Director's salary was shown as under: Mr. KS Kler : Rs. 1598273.00 Mr. Sachin Taneja : Rs. 1314741.91 Mr. Sunil Trakru : Rs. 1235658.72 14. Besides it, a loan of Rs. 14 lacs from Mr. Gulati and Vijay was also reflected in those compiling of accounts. However, said figures were not reflected in the accounts book of the company, seized during the course of FIR No.284/06 State v. Sunil Trakru 19/44 investigation. Further as per form 2 filed in ROC on 10.5.05, the complainant had been allotted 3999 shares, whereas in share holder's register, he was having just 1 share. MOU dt. 6.7.04 was also reflected that complainant KS Kler had obtained 40% share holding on 1.10.03 but in physical reality that was just an eye wash. Thus, the manipulation of accounts books could not be ruled out. However, since this opinion has been formed only on the basis of an apprehension/wishes of IO and not backed by any direct or substantive evidence, hence cannot be either relied upon or taken into consideration. The accused directors were diverting funds elsewhere as evidenced from the property taken in other name from the funds of the company. That bold siphoning was found in the correspondence in which shop No. 18 at Senior Mall, MG Road, Gurgaon was allotted to Modular Constructions, a partnership firm and not to Modular Construction (P) Ltd. though the money was belonging to the company. Auditors of the company approved this accounting treatment. But this matter was never put up before the board. This clearly shown siphoning off money from the company. 15. It has been further revealed that profit and loss account for the 15 months was drawn showing that the remuneration was paid to the complainant. However, books of accounts for the year 200304 and FIR No.284/06 State v. Sunil Trakru 20/44 200405 were not showing any such payment. Thus the auditor was also in collusion with the alleged directors and was not impartial. The above balance sheet had shown that the manipulations were carried out by the auditor. Arriving at loss of Rs. 71,85,784/ would have alerted auditor but he had chosen to ignore it. Yearly remuneration as recorded in the P&L account was Rs. 6 lacs and was shown as paid to the accused directors only. Even than auditor had certified in his personal capacity of payment of Rs. 15,98,273/ as salary to the complainant. He should have however refrained himself from showing a payment of Rs. 41,48,673.63/ as salary to directors. Once it was very much known to the auditor that Mr. KS Kler was not paid any remuneration as per his audit for the year ended 31.3.2004 thus drawing of remuneration of Rs. 15.98 lacs for a period of six months as per this balance sheet was a total falsification of accounts. Thus auditor was helping the accused directors in creating falsified documents to fulfill their ulterior motives and must have gained something in return. Again this finding is based on mere surmises and fancies without there being an element of evidence to support it. 16. It has been further revealed that CD A/c No. 2219 with Central Bank of India, Hazrat Nizamuddin, Delhi was got opened on 3.2.2005 by the accused after removal of complainant from directorship in the name of Modular P. Ltd. on the introduction of accountant Harender FIR No.284/06 State v. Sunil Trakru 21/44 Kumar Mishra. This account was closed on 14.11.2005. An amount of Rs. 1.19 crores was deposited in this account and the same was also debited through various transactions, most of them were through self cheques. Further a/c No. 1342560001518 with HDFC Bank, Defence Colony, New Delhi was opened on 26.7.2006 and accused were authorized signatory of this account. There was a balance of Rs. 3388 in this account as on 8.7.2007. 17. It has been further revealed that accused Sachin and Sunil had hatched a conspiracy and had induced the complainant to pledge his house G33 Kalkaji, Delhi with SBT with credit facility to the tune of Rs. 1 crore on the false promise of 60% of the sale proceeds of R115, GKI, New Delhi and 40% share holdings in the company. But he was neither given 60% of the sale proceeds of said house nor 40% share holding of the company and rather he was removed unauthorizedly from the post of directorship. The accused had manipulated books of accounts for causing wrongful gain to directors of the company and wrongful loss to the complainant. 18. On completion of investigation, chargesheet against accused Sunil Trakru, Sachin Taneja and Rakesh Jain was filed in the court. Cognizance of the offences was taken against all of them by the learned Predecessor of this court vide his order dated 29.09.2008. FIR No.284/06 State v. Sunil Trakru 22/44 19. I have heard the arguments advanced at bar at length by learned APP for the State Sh. Mayank Tripathi alongwith learned counsel Sh. Harpreet Singh representing the complainant. Sh. P. Banerjee representing the accused Sunil Trakru and Sachin Taneja and Sh. Jayant Sood representing accused Rakesh Jain and have also gone through the citations placed on record alongwith written submissions by the complainant as well as accused. 20. In his written submissions filed on behalf of complainant, it has been stated that it was the accused no. 1 and 2 who had approached the complainant in the year 2003 and had offered him directorship of their company with a promise of 40% share holding to be transferred in his favour and induced by the said offer, the complainant had joined their company as a Director and had also mortgaged his property bearing No. G33, Kalkaji, New Delhi with State Bank of Travancore, Karol Bagh Branch, New Delhi for drawing an OD facility of Rs. 1 crore and in December, 2003 complainant was also made to invest Rs. 14 lacs by the accused persons with a promise to return the same but the said amount was never returned back to him. Not only this, but also, the complainant had sold his property to the company of the accused persons for a total sale consideration of Rs. 60 lacs as per the MOU dated 12.2.2004 executed between the parties. However, lateron on 13.6.2005 the said property was FIR No.284/06 State v. Sunil Trakru 23/44 sold by the accused persons at a price of Rs. 1.1 crore against its market value of Rs. 3.4 crores and had also misappropriated the entire amount and had not paid the 60% of the said sale proceeds to the complainant as were promised earlier. It was also submitted that the accused persons themselves had admitted before the Arbitrator on 5.3.2005 that the said property could have fetched them a price of Rs. 1.7 crores and there were other materials available on record to suggest that actual value of the property in the market was around 3.4 crores as has also been reflected in the chargesheet at page 11 that in one of the valuations got conducted by City Bank on 6.12.2003 through one Sh. D.K. Nagpal, the property was stated to be worth to Rs. 2.16 crores and in subsequent valuation report again got conducted by City Bank through one Sh. Satish Kumar on 08.12.2003, it was stated to be worth around Rs. 1.65 - 1.75 crores with vacant possession and 70 to 75 lacs lesser in its value if acquired by old tenants. This argument raised on behalf of complainant is self -destructive of his own pleas because once the property was valued at such a higher side in the year 2003 itself then there was no need and occasion for him to have sold the property to the accused persons or their company for a meager amount of Rs. 60 lacs as has been claimed by him. By doing that he had also committed a breach of trust in respect of his principal who was the actual owner of the said property and whom the present complainant was FIR No.284/06 State v. Sunil Trakru 24/44 representing as his GPA holder. Furthermore the valuation report dated 8.12.2003 appeared to be more closer to the reality and the claims made by the accused persons because admittedly the property was pre occupied by the old tenants and hence was liable to fetch Rs. 70 to 75 lacs lesser than its actual value which was assessed to be 1.65 to 1.75 crore and hence if the accused persons had sold it out for Rs. 1.1 crore then by no stretch of imagination, it could be presumed that they had undervalued the price of the property. 21. Furthermore, the complainant could not place on record any document or correspondence by which he could have claimed to have found a buyer who was ready and willing to pay an amount of Rs. 3.5 crores for the said property. 22. So far as the property bearing no. G33 Kalkaji, New Delhi alleged to have been mortgaged by the complainant with State Bank of Travancore, Karol Bagh, New Delhi Branch for raising the over draft limit to Rs. 1 crore is concerned, admittedly the said property was not belonging to the complainant herein but was belonging to his wife and his two daughters. Once the complainant himself was not having any right, title or interest in the property, then it becomes an important and vital question to examine his locus standi to mortgage the said property with the bank. FIR No.284/06 State v. Sunil Trakru 25/44 23. So far as the allegations related to creating a charge over the aforesaid property by the accused persons and not getting the same cleared is concerned, it has been mentioned that the charge sheet itself at page 14 that on 1.3.2007 the accused persons had got the said property No. G33, Kalkaji, New Delhi free from all sorts of encumbrances by making the entire payment to the said bank and as such now the property was available to be enjoyed by the complainant as per his own wishes and whims. 24. Next issue raised by the complainant is related to his induction as an Additional Director in the company and his mysterious removal from the Directorship by the accused persons on 30.9.2004. So far as the allegations related to this aspect are concerned, I am of the considered opinion that the same had purely fallen within the domain and jurisdiction of Companies Act and the most appropriate authority to raise the grievance about such illegal removal from the Directorship or non allotment or transfer of shares were falling within the domain of Company Law Board/ROC/Company Court and by no stretch of imagination, it could be presumed that complainant was cheated at the hands of accused persons in any manner whatsoever because the civil element was in pre dominating position in this act of accused persons and criminal element was lacking to such a considerable amount so as to give it a colour of a criminal offence. FIR No.284/06 State v. Sunil Trakru 26/44 25. So far as the MOU executed between the parties related to sharing of profits which was executed between them on 12.2.2004 is concerned, a perusal of the said MOU clearly reveals that though the sale proceeds of the property bearing No. R115 G.K. Part I, New Delhi were agreed to be shared in the ratio of 60:20:20 between complainant and accused Sunil Trakru and Sachin Taneja, but it was also mentioned in the said agreement that the said agreement extracted the entire understanding between the share holders in respect of the said property and a proper and further agreement was also required to be prepared and signed by parties to give effect to the said MOU in accordance with the intent and purpose of understanding with regard to the share holdings in the said property and admittedly no such further agreement was ever executed by or between the parties nor even the complainant had ever laid any emphasis on the execution of any such further agreement. 26. So far as the question of nonallotment of shares or the alleged illegal removal of complainant from the directorship is concerned, as noted above, same is purely a question to be adjudicated upon by the Forums especially constituted for the said purpose and by no stretch of imagination, it could be presumed to have contained an element of deceit or fraudulent or dishonest intention necessary to constitute an offence of cheating because if the facts as narrated in the complaint are presumed to FIR No.284/06 State v. Sunil Trakru 27/44 contain all the necessary ingredients of the offence in the form and manner as suggested by the complainant in the present case then all criminal courts of the country shall get flooded by such kind of litigations when every investor would start approaching them leveling allegations of cheating at the hands of the company for non allotment of shares to him and it would make the other Forums constituted to exclusively deal with such matters purely redundant. 27. Alongwith written submissions complainant has also placed reliance on the following citations: 1)Kamala Devi Aggarwal v. State of West Bengal, (2002) 1 SCC 555 2) Mahesh Chaudhary v. State of Rajasthan, (2009) 4 SCC 439 3) Medchl Chemicals and Pharma Pvt. Ltd. v. Biological E. Ltd. (2000) 3 SCC 269 4) Sunil Kumar Paul v. State of West Bengal, (1964) 7 SCR 70 5) Crl. M.C. No. 4144 of 2009, Sanjay Aggarwal v. G.S. Tayal (decided by Hon'ble Mr. Justice M.L. Mehta, Judge, Delhi High Court). 6) Ashish Verma v. State, 186 (2012) DLT 238 7) Rajesh Bajaj v. State of NCT of Delhi, (1999) 3 SCC 259 FIR No.284/06 State v. Sunil Trakru 28/44 8)Haridaya Ranjan Prasad Verma v. State of Bihar, (2000) 4 SCC 168 So far as the question related to the applicability of ratio of Judgment Kamala Devi Aggarwal v. State (supra) in this case is concerned, I have no hesitation in holding that the same is not applicable to the facts of the present case because in the cited case, the complainant had challenged the authenticity and genuineness of the same document before Civil Court as well as before Criminal Court. However, the facts of the present case are distinguishable from the said case as much as the complainant had already invoked the arbitration clause of the impugned agreement in respect of which he had claimed himself to have been cheated at the hands of accused persons. So far as the judgment of Mahesh Chaudhary v. State of Rajasthan (supra) is concerned, this judgment is also not applicable to the facts of the present case as same is dealing with inherent powers of the Hon'ble High Courts exercised by them under Section 482 Cr.P.C. in respect of quashing of criminal proceedings whereas in the present matter one is concerned with the issue of framing of charge after filing of charge sheet in the present case. FIR No.284/06 State v. Sunil Trakru 29/44 So far as the judgment of Medchl Chemicals and Pharma Pvt. Ltd. v. Biological E. Ltd. (Supra) is concerned, this judgment only provides for weighing of the facts so as to ascertain as to whether in a factual situation the civil profile of complaint outrage a criminal and if so then no action under criminal law is warranted. So far as the judgment Sunil Kumar Paul v. State of West Bengal (supra) is concerned, this judgment deals with the powers of the courts to frame alternate charges when there exists a doubt regarding the nature of the offence alleged to have been committed. However, I have no hesitation in holding that in the given facts and circumstances of the present case there is no doubt in the mind of court regarding the nature of offence. So far as the judgment Sanjay Aggarwal v. G.S. Tayal is concerned, the said judgment deals with the trial of an accused for offences under section 138 N.I. Act alongwith offence under Section 420/406 IPC simultaneously, however, same is not the case in hands before this court. So far as the judgment Ashish Verma v. State (supra) is concerned, this judgment also deals with the dishonest intention in the given set of the facts and hence the ratio is not applicable to the given facts and circumstances of the present case. FIR No.284/06 State v. Sunil Trakru 30/44 So far as judgments Rajesh Bajaj v. State of NCT (supra) and Haridaya Ranjan Prasad Verma v. State of Bihar (supra) are concerned, both these judgments deals the powers of Hon'ble High Courts under Section 482 Cr.P.C. to quash a criminal proceeding. 28. During the course of submissions Sh. Harpreet Singh, learned counsel for complainant had also placed on record one citation in case titled as Shoukat Rai Malhotra and another v. Dellatora Enterprises Ltd. and another in Criminal MC 403/2011 and Criminal MA 1592/2011 decided by Hon'ble Ms. Justice Mukta Gupta on 17.4.2012, however, it is submitted that even in the said case, the Hon'ble High Court has left the question open to be decided by the Trial Court regarding attraction of offences under Section 420 as well as Section 406 IPC in the given set of facts and circumstances. 29. So far as offence under Section 406 IPC is concerned, I have no hesitation in holding that the ingredients for an offence under Section 406 IPC are entirely opposite to the ingredients of an offence of cheating as defined under section 415 IPC. To constitute of an offence of cheating dishonest intention and deceitful and fraudulent inducement are the necessary ingredients for the purpose of securing delivery or retention of property by the accused persons at the hands of a victim. Whereas to FIR No.284/06 State v. Sunil Trakru 31/44 constitute an offence under Section 406 IPC related to criminal breach of trust the parties must be standing in a fiduciary relationship or capacity qua each other so as to create a mutual trust among themselves. However, I have no hesitation in holding that the parties in the present case do not stand in such a fiduciary capacity or relationship qua each other so as to constitute a mutual trust amongst them and rather it is alleged by the complainant that it was the failure of accused person to fulfill their contractual obligations that had given rise to filing of the present complaint and registration of the case against them. Hence, by no stretch of imagination, it could be presumed that any of the ingredients for an offence under Section 406 IPC were attracted or involved in the given set of facts and circumstances. Hence, no such offence as alleged is made out. 30. Accused no.1 & 2 have also placed reliance upon the following judgments as under: 1) M/s GHCL Employees Stock Option vs. M/s India Infoline Ltd. (SC) in Criminal Appeal No. 489 to 494/2013 decided on 22.03.2013. 2) M/s Thermax Ltd. & Ors. vs. K.M. Johny & Ors. (SC) in Criminal Appeal No. 1868 of 2011 decided on 27.09.2011. 3) Maksud Saiyed Vs. State of Gujrat (SC) in Criminal Appeal No.1248/2007 decided on 18.09.2007 FIR No.284/06 State v. Sunil Trakru 32/44 4) Sh. Subhkaran Luharuka vs. State (Govt. of NCT of Delhi) (DHC) in Criminal M.C. No. 612223/2005 decided on 09.07.2010 5) Rajiv Thapar & Ors. vs. Madan Lal Kapoor (SC) in Criminal Appeal No. 174/2013. 6) Nirmal Bhanwarlal Jain vs. GHCL Employees Stock Option Trust (DHC), in Criminal M.C. No. 819/2009 and Criminal M.A. No. 3012/2009 decided on 14.12.2009. 7) Madhavrao Jiwaji Rao Scindia & Anr. vs. Sambhajirao Chandrojirao Angre & Ors. (SC) decided on 09.02.1988 8) S.K. Alagh vs. State of U.P. (SC) in Criminal Appeal no. 317/2008 decided on 15.02.2008. 31. However, most of them relate to the powers of the court to be exercised by it under Section 156 (3) Cr.P.C. as well as under Section 200 Cr.P.C. and also talk about the application of the concept of vicarious liability in the criminal jurisprudence, hence same are not directly connected with the present case except for the judgment Madhavrao Jiwaji Rao Scindia & Anr. vs. Sambhajirao Chandrojirao Angre & Ors. wherein it was held that where the civil element predominate the criminal element then in such a situation no criminal trial or prosecution is warranted in the given case because in every case of cheating or breach of trust some amount of civil as well as criminal elements are always found present. FIR No.284/06 State v. Sunil Trakru 33/44 32. So far as accused no.3 is concerned, he has also placed reliance on the following citation: 1. Rukmani Narvekar Vs. Vijaya Satardekar & Ors. 2008 (14) SSC 1, 2. Kanshi Ram Vs. State 2001 (1) JCC (Delhi) 320, 3. Dilawar Babu Kurane Vs. State of Maharashtra (2002) 2 SCC 135, 4. Sunil Bansal Vs. The State of Delhi 2007 (2) JCC 1415, 5. Krishan Kumar alias Munna Lal Vs. State of Bihar 2008 Crl. L. J. 2903, 6. Sumativijay Jain Vs. The State of M.P. & Ors, 1992 Crl. L.J. 97, 7. Rumidhar Vs. State of West Bengal (2009) 2 SCC 364, 33. In Rukmini Narvekar vs. Vijaya Satardekar & Ors. it was held that "there is no scope for the accused to produce any evidence in support of the submissions made on his behalf at the stage of framing of charge and only such materials as are indicated in Section 227 Cr.P.C can be taken into consideration by the Magistrate at that stage - In a proceeding taken therefrom under Section 482 Cr.P.C the court is free to consider material that may be produced on behalf of the accused to arrive at a decision FIR No.284/06 State v. Sunil Trakru 34/44 whether the charge as framed could be maintained" and in the light of aforesaid citation, my attention has been drawn by Sh. Jayant Sood, learned counsel for the accused on second para of page 16 of the charge sheet wherein the allegations against the accused Rakesh Jain, it has been mentioned that it was he who had prepared the compilation of the account for 15 months after the order dated 05.02.2005 passed by Arbitrator Sh. Ravinath and it has been claimed further that the said compilation was filed before Arbitrator and was not used either by this accused or by accused no. 1 & 2 before any other forum such as Income Tax Authorities or Registrar of Companies etc. 34. Further my attention has also been drawn to a letter dated 16.03.2005 wherein the present accused had mentioned about his compilation of accounts for the period 01.10.2003 till 31.12.2004 which was further subject to the notes attached with his report wherein he had categorically stated that he was not provided with any certified balance sheet or certified invoices and he had prepared his compilation on the basis of vouchers alone which were provided to him by accused no. 1 & 2 and even there were no proper bills for some expenses to the tune of Rs.18,500/ and were taken on estimated basis and lastly he had mentioned that all withdrawals FIR No.284/06 State v. Sunil Trakru 35/44 made by the Directors including the payments for installments of the car loan were being debited to the Director's salary account and were charged to profit and loss account and hence, it has been submitted that no criminality can be attributed to the acts of the present accused who was only acting in his professional capacity by discharging his professional duties towards the clients who had engaged him after paying his professional fees. 35. I find force in the submission of learned counsel because the activities of a professional Chartered Accountant cannot be put to question or any challenge merely on the basis of the opinion of some other Chartered Accountant as every professional has his own way and unique style and manner of working and one professional cannot sit in appeal or revision upon the work done by the other professional. In the absence of any specific wrongful gain having been derived by the accused no.3 for his alleged acts and in the absence of any corroborative evidence to establish the allegations against him, I do not find any material for framing of charge for any of the offences as alleged to have been committed by him as well. 36. So far as the allegations of the complainant regarding passing of resolution dated 20.04.2005 signed by accused no.1 & 2 FIR No.284/06 State v. Sunil Trakru 36/44 in respect of the disposal of property bearing no. R115, Greater KailashI, New Delhi are concerned, I have no hesitation in holding that as per the prevailing practices under the Company Law any resolution can be passed by the Directors of a Company by a majority of Directors after completion of the quorum. Hence, once two out of the three Directors had signed the resolution same would have amounted to have been passed by 2/3rd majority and the absence of the signatures of the complainant thereon shall not make that resolution illegal and void ab initio. 37. So far as the allegations of the complainant related to constitution of other firms by the complainants and diversion of funds in the accounts of those firms are concerned, the accused persons had not given any undertaking to that effect that they shall continue with their business in the name of one firm alone and in the absence of any other legal impediment or bar operating against them, they were free to do business by having any numbers of firms which they wanted to have and since complainant was not a part of those firms hence,he had no right whatsoever to interfere in the affairs of the those firms and at best he could have sought rendition of the accounts from the accused no. 1 & 2 in respect of the firm in FIR No.284/06 State v. Sunil Trakru 37/44 which he was claiming himself to be a Director which admittedly he was not nor he had done the same till date. 38. It is also surprising and disturbing for me to note that on the one hand complainant had alleged that he was cheated by the acts and misdeeds of the accused persons in respect of the agreement entered by them with the complainant and on the other hand he had placed reliance on the same agreement to invoke its arbitration clause and to get the an arbitration award passed in his favour from the Arbitrator. In this regard I am also supported by the judgment of our own Hon'ble High Court of Delhi in case titled as Escorts Yamma Motors Ltd. vs. State (1998) DLT page 662 (DB) wherein in the similar set of facts and circumstances, where the complainant had already resorted to civil remedy on the same allegations on which he was alleging the commission of offences under section 420/406/468 IPC the criminal proceeding was quashed by the Hon'ble High Court with the findings that the complainant could not have blown hot and cold simultaneously by relying on the agreement before the Civil Authorities to suit his convenience and by challenging the same document in the criminal proceedings with the allegations of cheating and breach of trust FIR No.284/06 State v. Sunil Trakru 38/44 alongwith forgery and had rather called it an abuse of process of law. 39. Reliance has been placed upon judgment of Hon'ble Supreme Court in case titled as Union of India v. Prafulla Kumar, AIR 1979 SC 366 wherein it was held that: "The Judge while considering the question of framing the charges under section 227 of the Code has the undoubted power to sift and weigh the evidence for the limited purpose of finding out whether or not a prima facie case against the accused has been made out". "Where the materials placed before the Court disclose grave suspicion against the accused which has not been properly explained the Court will be fully justified in framing a charge and proceeding with the trial". "The test to determine a prima facie case would naturally depend upon the facts of each case and it is difficult to lay down a rule of universal application. By and large however if two views are equally possible and the Judge is satisfied that the evidence produced before him while giving rise to some suspicion but not grave suspicion against the accused, he will be fully within his right to discharge the accused". "In exercising his jurisdiction under section 227 the Judge which under the present Code is a senior and experienced court cannot act merely as a Post Office or a FIR No.284/06 State v. Sunil Trakru 39/44 mouthpiece of the prosecution, but has to consider the broad probabilities of the case, the total effect of the evidence and the documents produced before the Court, any basic infirmities appearing in the case and so on. This however does not mean that the Judge should make a roving enquiry into the pros and cons of the matter and weigh the evidence as if he was conducting a trial". 40. Similarly, reliance has also been placed by accused no.1 on B. Suresh Yadav vs. Sharifa Bee & Anr. 2008 AIR (SC) 210, 2007 (11) SCR 238 wherein it has been held that: "For the purpose of establishing the offence of cheating, the complainant is required to show that the accused had fraudulent or dishonest intention at the time of making promise or representation. In a case of this nature, it is permissible in law to consider the stand taken by a party in a pending civil litigation. We do not, however, mean to lay down a law that the liability of a person cannot be both civil and criminal at the same time. But when a stand has been taken in a complaint petition which is contrary to or inconsistent with the stand taken by him in a civil suit, it assumes significance". 41. Hon'ble Supreme Court had also further relied upon the ratio laid down earlier by it in G. Sagar Suri & Anr. v. State of U.P. & Ors, (2000) 2 SCC 636 which is reproduced as under: FIR No.284/06 State v. Sunil Trakru 40/44 "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". 42. Further, Hon'ble Supreme Court had also relied upon the ratio of its own earlier decision in Anil Mahajan v. Bhor Industries Ltd. & Anr. (2005) 10 SCC 228 which is reproduced as under: "The substance of the complaint is to be seen. Mere use of the expression cheating in the complaint is of no consequence. Except mention of the words deceive and cheat in the complaint filed before the Magistrate and cheating in the complaint filed before the police, there is no averment about the deceit, cheating or fraudulent intention of the accused at the time of entering into MOU wherefrom it can be inferred that the accused had the intention to deceive the complainant to pay". 43. Further, Hon'ble Supreme Court had also relied upon the ratio in Hira Lal Hari Lal Bhagwati v. CBI, New Delhi (2003) 5 SCC 257 which is as under: "It is a settled law, by a catena of decisions, that for establishing the offence of cheating, the complainant is required to show that the accused had fraudulent or dishonest intention at the time of making promise or representation". FIR No.284/06 State v. Sunil Trakru 41/44 44. In case of Hridaya Ranjan Prasad Verma vs. State of Bihar & Another reported in (2000) 4 SCC 168, it was observed as under: "On a reading of the section it is manifest that in the definition there are set forth two separate classes of acts which the person deceived may be induced to do. In the first place he may be induced fraudulently or dishonestly to deliver any property to any person. The second class of acts set forth in the section is the doing or omitting to do anything which the person deceived would not do or omit to do if he were not so deceived". (Para 14) "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 of inducement which may be judged by his subsequent conduct but for this subsequent conduct is not the sole test. Mere 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. (Para 15) FIR No.284/06 State v. Sunil Trakru 42/44 45. Similarly in Murari Lal Gupta vs. Gopi Singh reported in (2005) 13 SCC 699, it was held as under: "The complaint does not make any averment so as to infer any fraudulent or dishonest inducement having been made by the petitioner pursuant to which the respondent
parted with the money. It is not the case of the respondent that the petitioner does not have the property or that the petitioner was not competent to enter into an agreement to sell or could not have transferred title in the property to the respondent. Merely, because an agreement to sell was entered into which agreement the petitioner failed to honour, it cannot be said that the petitioner has cheated the respondent. No case for prosecution under Section 420 or Section 406 IPC is made out even prima facie. The complaint filed by the respondent and that too at Madhepura against the petitioner, who is a resident of Delhi, seems to be an attempt to pressurize the petitioner for coming to terms with the respondent". (Para 6)
46. In Indian Oil Corporation vs. M/s NEPC India Ltd. AIR 2006 SC 2780 it was held that:
"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 FIR No.284/06 State v. Sunil Trakru 43/44 interests of lenders/creditors. Such a tendency is seen in several family disputes also, leading to irretrievable break down 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 though criminal prosecution should be deprecated and discouraged". (Para 10)
47. In view of my aforesaid discussion, I have no hesitation in holding that the disputes between the parties are purely of civil in nature which do not attract any criminal penal provisions. Accordingly, all accused persons stand discharged in this case from the allegations of commission of respective offences by them. Bail bonds and surety bonds of all the accused persons have been cancelled and discharged. However, they are directed to furnish their bail bonds in terms of Section 437A Cr.P.C. in the sum of Rs. 20,000/ each within ten days from the date of this order.
ANNOUNCED IN THE OPEN COURT
TODAY ON 30.11.2013
(LOKESH KUMAR SHARMA)
CMM/SE/Saket Court/New Delhi
FIR No.284/06 State v. Sunil Trakru 44/44