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Delhi District Court

Titled As Ace Innovators Pvt. Ltd. vs Hewlett Packard on 6 May, 2015

 IN THE COURT OF ADDITIONAL SESSIONS JUDGE­01 : SED:
             SAKET COURTS: NEW DELHI 
          PRESIDED BY : MS. RENU BHATNAGAR

Case ID No. 02406R0085092013
Criminal Revision No. 02/13

CC No. 75/01
titled as ACE Innovators Pvt. Ltd. Vs Hewlett Packard 
Financial Service (India),
Concerned /Successor Court of Sh. Lokesh Kumar Sharma, 
ACMM, South East District, Saket Courts, New Delhi. 

In the matter of :


ACE Innovators Pvt. Ltd. 
Having its registered office at:­
8/42, Kirti Nagar Industrial Area,
New Delhi­110015.
Acting through its Director:
Mr. Deepak Sharma. 

                                                     .....    Revisionist

Versus    

1.  Hewlett­Packard Financial Services (India)
Private Ltd. 
Having its registered office at:
Surya Crown Plaza, New Friends Colony,
New Delhi­110005. 




CR No. 02/13  ACE Innovators Pvt. Ltd.  Vs
                         Hewlett Packard Financial Services Pvt. Ltd.  
                                                              Page No. 1 of 13
 2.  Hewlett­Packard Sales India Pvt. Ltd. 
Surya Crown Plaza, New Friends Colony,
New Delhi­110015. 

3.   Rajinder Vishwanath Vruddula
Director :
Hewlett­Packard Financial Services (India)
Private Ltd. 
Surya Crown Plaza, New Friends Colony,
New Delhi­110005. 

4.   Anthony James O Connor 
Director:
Hewlett­Packard Financial Services (India)
Private Ltd. 
Surya Crown Plaza, New Friends Colony,
New Delhi­110005. 

5.  VNS International Ltd. 
Distributor
Sales office, 16, Vaishali,
Main Road, Pitampura,
Delhi­110034.  

6.  Tarun Makhija
(Head of Credit Division of Respondent/ Accused No.1)
Surya Crown Plaza, New Friends Colony,
New Delhi­110005. 

7.   Arun Sood
(Senior Sales Manager of Respondent/Accused No. 2)
Surya Crown Plaza, New Friends Colony,
New Delhi­110005. 




CR No. 02/13  ACE Innovators Pvt. Ltd.  Vs
                         Hewlett Packard Financial Services Pvt. Ltd.  
                                                              Page No. 2 of 13
 8.  Vinay Aggarwal 
(Authorized Signatory of Respondent/Accused No.1)
Surya Crown Plaza, New Friends Colony,
New Delhi­110005. 

9.   Rohit Kumar Arora
(Employee of Respondent/Accused no.2)
Surya Crown Plaza, New Friends Colony,
New Delhi­110005. 


                                                         .....      Respondents

                                 O R D E R

06.05.2015.

1. This is a criminal revision filed under Section 397 Cr.P.C filed by the revisionist ACE Innovators Pvt. Ltd. against Hewlett Packard Financial Services Pvtl. Ltd. (9 respondents). The revision is filed against the order dated 21.02.2013 passed by Sh. Lokesh Kumar, Ld. ACMM, South East District, New Delhi whereby the Trial Court had dismissed the complaint of the revisionist for summoning the accused persons for the offence under Section 406/420/120B IPC.

2. Before appreciating arguments of the Ld. counsels for both the sides it is necessary to know the facts in brief:­

3. The revisionist company is a Private Limited Company and incorporated under the Companies Act, 1956 whereas Respondent no.1 is a Private Limited Company(duly incorporated) which offers Credit and Funding facilities over the purchase of electronic equipments.

CR No. 02/13 ACE Innovators Pvt. Ltd. Vs Hewlett Packard Financial Services Pvt. Ltd.

Respondent no. 2 is also a duly incorporated company which sells and market HP products in India. Respondent no.3 and 4 are the Directors of respondent no.1 company. Respondent no.5 is the Distributor of respondent no.2. Respondent no.6 is the Head of Credit Division of respondent no.1. Respondent no.7 is Sr. Sales Manager of respondent no.

2. Respondent no.8 is authorized signatory who has signed Master Rental and Financing Agreement on behalf of the respondent no.1 company. Respondent no.9 is the employee of the Respondent no.2 company. That the revisionist was awarded the contract by Unique Identification Authority of India (UIDAI) for Data Capture of residents of Delhi and their enrollment process for the purpose of facilitating process of issue of AADHAR cards vide Delhi Government order for the residents of Delhi. In the check list provided by UIDAI for enrollment centers, the details of infrastructure requirements was mentioned wherein it was specifically mentioned that the Laptop/Desktop should not be of 64 bit Operating System as the same was not supported by the software of UIDAI. For the purchase of electronic equipments, the company had availed credit and finance facilities from respondent no. 1 who has credited the same to the revisionist as and when required. Besides imposition of financial stipulation, no condition of nature of work was imposed with regard to purchase of product of any specific company. However in the last week of September­October 2011 revisionist had approached respondent/accused no.1 whereby respondent/accused no.1 had imposed a specific condition vide an email dated 30.09.2011 sent by respondent no.5 CR No. 02/13 ACE Innovators Pvt. Ltd. Vs Hewlett Packard Financial Services Pvt. Ltd.

that revisionist had to purchase 50% of the products from respondent no.2 company only. Since it was mandatory for revisionist to ensure the timely execution of the project awarded by the UIDAI, it had no option but to agree on the said condition. The aforesaid credit facilities of Rs. 1,57,59,012.22 for financing the payment of amount relating to invoices of the electronic equipments purchased by the revisionist was approved by the respondent no.1 and accordingly, revisionist had furnished the Bank Guarantee dated 03.11.2011 for Rs. 44,62,125/­ from its banker Bank of India, Rajinder Place Branch, New Delhi in favour of respondent no.1 and it has also issued 24 post dated cheques of Rs. 7,82,751/­ amounting to Rs. 1,87,86,024/­ in favour of respondent no.1. The revisionist has also signed a Master Rental and Financing Agreement dated 10.01.2011 with respondent no.1 company signed by the respondent no.6 on behalf of respondent no.1. That revisionist has placed the order for supplying 215 Laptops vide purchase order No. 206 and 207 dated 03.10.2011 mentioning the specific description of the Laptops that the same must be in adherence of the specification of UIDAI and that the Laptop had to be of 32 bit Operating System. However the revisionist was shocked to see when it received 127 Laptops of HP with 64 bit Operating System installed in them instead of 32 bit Operating System. Immediately, on 29.10.2011 revisionist wrote to respondent no.9 about the supply of 127 HP Laptops with wrong Operating System. The said email was followed by another email on 31.10.2011. Thereafter, the respondent had taken back 127 HP Laptops but had not returned the post dated cheques and CR No. 02/13 ACE Innovators Pvt. Ltd. Vs Hewlett Packard Financial Services Pvt. Ltd.

Bank Guarantee. The revisionist had incurred a loss of Rs. 3.22 crores on account of supply of 64 bit Operating System Laptops instead of 32 bit Operating System Laptops. It is stated that the respondents have already invoked Bank Guarantee and encashed the post dated cheques dishonestly and fraudulently and induced the revisionist for delivering them wrongly configured Laptops. It is stated that the respondents in connivance with dishonest and fraudulent intention induced the revisionist company to issue Bank Guarantee and post dated cheques and with malafide object of causing wrongful gains to the respondent company and themselves had committed offence under Section 420 IPC.

4. The main grievances of the revisionist against the order passed by the Trial Court is that order is non speaking one. It is stated that court has not appreciated the facts of the case properly as admittedly the respondents were required to deliver the 32 bit Operating System installed Laptops which they failed to supply and fraudulently and dishonestly encashed the post dated cheques obtained by them at the time of Bank Guarantee. It is argued by the counsel for revisionist that despite the order to respondent to supply 32 bit Operating System Laptops he has wrongly supplied 64 bit Operating System Laptops on 28.10.2011. On 29.10.2011 the revisionist had sent a mail to take back Laptops. It is stated that respondent no.1 is financial arm of respondent no.2 and is partly covered under Section 420 IPC. It is stated that inducing was intentional otherwise the revisionist would not have given Bank Guarantee. It is stated that respondents have taken back 127 Laptops CR No. 02/13 ACE Innovators Pvt. Ltd. Vs Hewlett Packard Financial Services Pvt. Ltd.

which were not delivered till date. Hence it is prayed that the order dated 21.02.2013 be set aside. In support of the arguments Ld. Counsel for revisionist has referred the judgments:­

(i). Rosy and another Vs State of Kerala and others, 2000(1) JCC 228 : (2000) 2 SCC 230.

(ii). Chandra Deo Singh Vs Prokash Chandra Bose, (1964) 1 SCR 639.

(iii). Kewal Krishan Vs Suraj Bhan, (1980) Supp SCC 499.

(iv). Shivjee Singh Vs Nagendra Tiwary and Ors. 2010 (3) JCC 2238.

(v). Onkar Nath Mishra and Ors. Vs State (NCT of Delhi) & Another Crl. Appeal No. 1716/2007 decided on 14.12.2007 by Supreme Court of India.

(vi). M/s India Oil Corporation Vs M/s NEPC India Ltd. & another, Appeal (Crl.) 834/2002 decided on 20.07.20006 by Supreme Court of India.

(vii). R. Venkatakrishnan Vs CBI , Crl. A. No. 76/2004 decided on 07.08.2009 by Supreme Court of India.

5. Respondent No. 1,3,4 and 6 filed reply. It is stated on their behalf that the power of revisionist court are limited and the order of the court of lower court should not be lightly set aside unless it has entailed miscarriage of justice or where two views are possible merely the fact that the revisional court takes other view than the one taken by the lower court. It is stated that order passed by the Trial Court is well reasoned CR No. 02/13 ACE Innovators Pvt. Ltd. Vs Hewlett Packard Financial Services Pvt. Ltd.

order. It is stated that section 420/406 IPC are mutually exclusive and that the property acquired by the trick cannot be a subject matter of trust. The imposition of any condition on the revisionist by respondent no.1 in Master Rental and Financing Agreement would not constitute deception so as to constitute offence of cheating, as respondent no.1 was well within his right to impose the condition considering that it was a subsidiary of Hewlett Packard. It is stated that allegations are vague and are not specific about the role of the respondents and the dispute is certainly of civil nature. Hence, it is stated that there is no substance in the submission. In support of arguments, the counsel for respondents have filed following citations:­

(i). Devendra and others Vs State of Uttar Pradesh and another (2009) 7 SCC 495.

(ii). Rajaram Gupta and Others Vs Dharamchand and Others 1983 Crl. L.J. 612.

6. In reply filed by respondent no.5, it is stated by the respondent No. 5 that they are only the distributor of respondent no.2. No purchase order were put to them by the revisionist. The respondent no. 5 has only taken back the goods. They had no direct dealing with the revisionist. Even in the civil suit filed in High Court, respondent no.5 has been deleted from the arena of defendant vide order dated 04.10.2013 passed by the High Court. In support of arguments respondent No.5 has cited:­

(i). S.W. Palanitkar and others Vs State of Bihar and another CR No. 02/13 ACE Innovators Pvt. Ltd. Vs Hewlett Packard Financial Services Pvt. Ltd.

AIR 2001 SC 2960.

7. In reply, revisionist no. 2,7 and 9 have stated that Ld. MM has rightly passed the order. It is argued that as transactions between the parties is purely civil in nature and the complainant is only trying to convert the civil transactions into a criminal offence by abusing the process of law. It is stated that to attract the provisions of Section 406 IPC the entrustment of the property is required and the complaint would show that no property has been entrusted with respondent no. 2,7 and 9 nor any allegations are there that they had converted the property to their use or dishonestly used or disposed of the same. It is submitted that the dispute in respect of a contract between the revisionist and respondent no.1 and there was no entrustment to respondent no. 2, 7 and 9. Further to attract the provision of Section 420 IPC there should be fraudulent and dishonest inducement of a person by deceiving him but no such allegations are there qua the respondent no. 2,7 and 9 in the complaint. Further, the complaint does not disclose any such retaining of the property by the respondents nor they had induced the complainant to do or omit to do anything and the act was done which caused or likely to cause damage, harm to the complainant in body, mind or property. Further, for the offence of criminal conspiracy under Section 120B IPC there should be an agreement to do any illegal act and since the allegations of Section 406/420 IPC are not attracted against the respondents no. 2, 7 and 9, a criminal conspiracy is also not made out. It is stated that the revisionist has failed to adhere to payment of price of CR No. 02/13 ACE Innovators Pvt. Ltd. Vs Hewlett Packard Financial Services Pvt. Ltd.

Laptops brought from the respondent no.2, 7 and 9. It is stated that as per the purchase order which was later on modified orally 127 Laptops with 64 bit Operating system were delivered by respondent no.5 with the assurance that remaining 13 Laptops will be delivered within 7­10 days. The said Laptops were further taken back and upgraded to 32 bit Operating System and UIDAI application was shown running in the system. Since the revisionist intended use of laptops supplied by different brands, it raised several false issues with the Laptops and made persistent demands pursuant to which the respondent no. 5 had taken back Laptops which were supplied. The revisionist had filed a suit for declaration, injunction and damages before the High Court of Delhi against the respondent no.1,2 and 5 herein. It is stated that the complainant does not disclose any offence nor the role of the each of the respondent is mentioned. No criminality can be attached to respondent no. 7 and 9 who are merely employees of the respondent no.2. That respondent no.1 is an affiliate of respondent no. 2 and which gives finances in order to promote the said sale of HP branded products and services. Respondent no.2 is not responsible regarding the agreement executed between the revisionist and respondent no.1. It is stated that there is no contractual obliquity between the respondent no. 9 and the revisionist. It is stated that there is no specific allegations hence the trial court has rightly passed the order. In support of arguments, respondent no.2,7 and 9 have relied upon :­

(i). V.Y. Jose and another Vs State of Gujarat and another (2009) 3 SCC 78.

CR No. 02/13 ACE Innovators Pvt. Ltd. Vs Hewlett Packard Financial Services Pvt. Ltd.

(ii). Dalip Kaur and others Vs Jagnar Singh and another (2009) 14 SCC

696.

(iii). G.H.C.L Employees Stock Option Trust Vs. India Infoline Ltd. (2013) 4 SCC 505.

(iv). State Vs RadhaKanta Patnaik Govt. appeal No. 2 of 1952 decided on 09.10.1953 by Orissa High Court.

8. I have heard the submissions of both the sides and gone through the replies and the written submissions. I have also gone through the order passed by the Trial Court. As per the complaint of the complainant, for the purchase of the electronic equipments necessary for execution of the project awarded to the complainant UIDAI, the complainant had been availing Credit and Finance facilities from accused no.1 who had been granting the same as and when required by the complainant company while extending further facilities. If accused No.1 had imposed certain conditions in September/October, 2011 on the complainant company to purchase 50% of the products of accused no.2, it cannot be treated as cheating. The loan was sanctioned to the complainant company by accused no.1. Accused no.3 and Accused no.4 are the Directors of the accused no.1 and Accused no.6 and 8 are the employees. Since no criminality can be attached on accused no. 1, hence no liability is there so far as accused no.3, 4, 6 and 8 are concerned. Accused No. 2 is the manufacturer of laptops which was marketed through the accused no. 5, its distributor. The laptops which are supplied to the complainant by accused no.2 through its distributor accused no.5 CR No. 02/13 ACE Innovators Pvt. Ltd. Vs Hewlett Packard Financial Services Pvt. Ltd.

were not of the correct specification. The Trial Court has rightly observed that it only amounts to defective delivery of goods not answering to their correct description as provided under Sales of Goods Act and any dispute arising out of the defective delivery shall be of civil nature and will not necessarily attract the ingredients of any offence. The Trial Court has rightly observed that it is not clear as to how and in what mode or manner a fraudulent inducement or deceit with dishonest intention was made by accused no. 5.

9. Hence, no criminality can be attached to the case of accused no.2 or its employees accused no. 7 and 9 or to the distributor accused no.5.

10. Admittedly, a civil case of damages is pending in Hon'ble High Court. Ld. Counsel for complainant has stated that despite the pendency of the said suit and this revision, accused no.1 has encashed the Bank Guarantee in respect of the defective laptops and as such, he should be hauled up for cheating. On the other hand, counsel for the accused has stated that the complainant has applied for injunction in Hon'ble High Court for restraining accused no.1 from encashing the Bank Guarantee and the cheques given by the complainant and since no injunction was granted by the Hon'ble High Court, the Bank Guarantee was encashed and as such, it cannot be termed as cheating.

11. In view of the above discussion, I do not find any illegality or infirmity in the order passed by the Trial Court. The dispute is of the civil nature. Hence finding no merit, criminal revision petition is CR No. 02/13 ACE Innovators Pvt. Ltd. Vs Hewlett Packard Financial Services Pvt. Ltd.

dismissed. Trial Court Record be sent back along with copy of the order to the concerned Trial Court/successor court. Criminal Revision file be consigned to record room.

ANNOUNCED IN THE OPEN COURT ON 06.05.2015.

( RENU BHATNAGAR ) ASJ­01/SOUTH EAST DISTRICT/ SAKET COURTS / NEW DELHI CR No. 02/13 ACE Innovators Pvt. Ltd. Vs Hewlett Packard Financial Services Pvt. Ltd.