Gujarat High Court
Vipulbhai Narottambhai Bhoya vs State Of Gujarat on 17 February, 2025
NEUTRAL CITATION
R/CR.MA/2048/2016 JUDGMENT DATED: 17/02/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/CRIMINAL MISC.APPLICATION (FOR QUASHING & SET ASIDE
FIR/ORDER) NO. 2048 of 2016
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE J. C. DOSHI
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Approved for Reporting Yes No
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VIPULBHAI NAROTTAMBHAI BHOYA & ANR.
Versus
STATE OF GUJARAT & ANR.
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Appearance:
MR ZUBIN F BHARDA(159) for the Applicant(s) No. 1,2
ALPESH J CHAUHAN(8630) for the Respondent(s) No. 2
MR.MINHAJ M SHAIKH(6847) for the Respondent(s) No. 2
MR SOHAM JOSHI, APP for the Respondent(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE J. C. DOSHI
Date : 17/02/2025
ORAL JUDGMENT
Rule. Learned APP waives service of rule for respondent no.1 and learned advocate Mr.Minhaj Shaikh waives service of rule for respondent no.2.
1. This petition under section 482 of Cr.P.C. seeks following reliefs in para 6:-
"(A) That this Hon'ble Court may be pleased to admit and allow the petition.
(B) That this Hon'ble Court be pleased to quash and set aside complaint registered as CR No.I-10 of 2016 with Gotri Police Station, Vadodara City lodged by respondent no.2 under section 406, 420, 504, 506(2), 294(B), 120(B) and 114 of Indian Penal Code against the petitioners in the Page 1 of 10 Uploaded by SATISH C. VEMULLA(HC00206) on Wed Feb 19 2025 Downloaded on : Wed Feb 19 22:24:21 IST 2025 NEUTRAL CITATION R/CR.MA/2048/2016 JUDGMENT DATED: 17/02/2025 undefined interest of justice.
(C) Pending admission and final disposal of this petition, this Hon'ble Court may be pleased to stay of investigation of the complaint registered as CR No.I-10 of 2016 with Gotri Police Station, Vadodara City lodged by respondent no.2 under section 406, 420, 504, 506(2), 294(B), 120(B) and 114 of Indian Penal Code.
(D) That this Hon'ble Court be pleased to grant such other and further relief as may be deemed fit and proper in the facts and circumstances of the case.
(E) That this Hon'ble Court be pleased to award cost of this petition.
2. Brief facts of the case are as under :-
2.1 As per case of complainant, he was introduced by his friend Hareshbhai Jhapadia to the accused no. 1 and his father Bachubhai Bhoya, residents of village Hanumanbari, Taluka Vansda, District Navsari and thereafter, the complainant received an order of export of Basmati Rice for 120 tons from one Samir Rakif Motorwala of Classic Export and Import, Mumbai and the complainant also received Rs. 15,00,000/- through a bank transaction from the said person. In turn, the complainant placed an order of 120 tons of Basmati rice from M/s. Asian Traders through Vipulbhai Bachubhai Bhoya and his father Bachubhai Bhoya who was managing M/s. Asian Traders and the complainant also deposited on 29.05.2014 from his ICICI Bank Account, a sum of Rs. 10,00,000/- in the Bank Account of Asian Traders towards the first installment and thereafter, a contract was executed between the M/s Asian Traders and the complainant dated 09.06.2014. However, the accused failed to make the delivery of Basmati Rice with the prescribed time period and therefore, the complainant cancelled the order that was placed and also demanded Rs. 10,00,000/- back, however Page 2 of 10 Uploaded by SATISH C. VEMULLA(HC00206) on Wed Feb 19 2025 Downloaded on : Wed Feb 19 22:24:21 IST 2025 NEUTRAL CITATION R/CR.MA/2048/2016 JUDGMENT DATED: 17/02/2025 undefined the accused evaded the return of the amount and by not returning back the amount, the accused committed an offence of cheating as well as criminal breach of trust and when the complainant in person tried to ask for the return of the money, the accused abused the complainant and also threatened the complainant to kill him. Therefore, the complainant filed complaint.
3. Heard learned Senior Advocate Mr.Zubin Bharda for the petitioner, learned advocate Mr.Minaj Shaikh for complainant and learned APP Mr.Soham Joshi for the respondent State.
4. Learned advocate Mr.Bharda for the petitioner submitted that it is case of civil nature. It is further submitted that first informant has given color of criminality to case of civil nature.
He would further submit that for establishing offence of criminal breach of trust and forgery, there is no necessary averments coming out from the bare reading of FIR. It is submitted that on reading FIR, prima facie it appears that notice is issued under civil nature for recovery of amount of Rs.10 lakhs. It is completely commercial transaction which is converted into criminality. Referring to MOU stated in the FIR, it is submitted that first informant who was expected to give 100% advance payment, has not paid entire amount for purchasing 120 ton Basmati rice but paid Rs.10 lakhs only instead. It is further submitted that as per MOU executed between the parties, order process will start only after advance payment of entire amount but in the present case, complainant has not paid 100% advance payment. Therefore, the petitioner has not started process for releasing 120 Ton basmati rice. It is also argued that whether it Page 3 of 10 Uploaded by SATISH C. VEMULLA(HC00206) on Wed Feb 19 2025 Downloaded on : Wed Feb 19 22:24:21 IST 2025 NEUTRAL CITATION R/CR.MA/2048/2016 JUDGMENT DATED: 17/02/2025 undefined is breach of MOU or not, could only be decided in the civil litigation. By no means, for such transaction criminal proceedings is maintainable. He further referred to Annexure B, certificate of Importer Exporter Code issued by Government of India, whereby, Mr.Vipulbhai Bhoya is stated to be proprietor of Asian Traders. It is submitted that in this circumstances, arraigning father of Mr.Vipulbhai as accused is pressure tactics adopted by the complainant. Mr. Narottambhai Bhoya has nothing to do with alleged transaction.
3.1. In view of above and referring to judgment of Hon'ble Apex Court in the case of Vijay Kumar Ghai v/s. The State of West Bengal [2022 (5) Scale 154], learned advocate for the petitioners submitted to quash entire proceedings against the petitioners as allowing FIR would be abuse of process of law.
4. Per contra, learned advocate Mr.Shaikh for the complainant having referred to FIR would submit that Rs.10 lakhs has been transferred by first informant in the account of Asian Traders and despite that, accused has not released 120 ton Basmati rice or part thereof and thereby, they have committed offence. It is submitted that considering MOU, prima facie it establish that it is criminal breach of trust and Rs.10 lakhs has been siphoned by accused. Looking to this facts, it is submitted to dismiss the petition by allowing investigating officer to proceed further in the matter.
5. Learned APP Mr.Soham Joshi for the respondent - State adopted the arguments of learned advocate Mr.Shaikh for the complainant and submitted to dismiss the petition.
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6. Having heard learned advocate for both the sides, what could be notice that impugned FIR is filed for the offence punishable under section 406, 420, 504, 506(2), 294(B), 120(B) and 114 of Indian Penal Code.
7. The essential ingredients of the offense of criminal breach of trust can be stated as are:
"(1) The accused must be entrusted with the property or with dominion over it, (2) The person so entrusted must use that property, or; (3) The accused must dishonestly use or dispose of that property or wilfully suffer any other person to do so in violation, (a) of any direction of law prescribing the mode in which such trust is to be discharged, or; (b) of any legal contract made touching the discharge of such trust."
8. The essential ingredients of section 405 of IPC are as under
:-
"Entrustment" of property under Section 405 of the Indian Penal Code, 1860 is pivotal to constitute an offence under this. The words used are, 'in any manner entrusted with property'. So, it extends to entrustments of all kinds whether to clerks, servants, business partners or other persons, provided they are holding a position of 'trust'. A person who dishonestly misappropriates property entrusted to them contrary to the terms of an obligation imposed is liable for a criminal breach of trust and is punished under Section 406 of the Penal Code."
9. The essential ingredients of offence of cheating are as under :-
"1. Deception of any person
2. (a) Fraudulently or dishonestly inducing that person- (i) to deliver any property to any person: or(ii) to consent Page 5 of 10 Uploaded by SATISH C. VEMULLA(HC00206) on Wed Feb 19 2025 Downloaded on : Wed Feb 19 22:24:21 IST 2025 NEUTRAL CITATION R/CR.MA/2048/2016 JUDGMENT DATED: 17/02/2025 undefined that any person shall retain any property; or (b) intentionally inducing that person to do or omit to do anything which he would not do or omit if he were no so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body,mind,reputation or property."
10. In view of above, a fraudulent or dishonest inducement is an essential ingredient of offence. A person who dishonestly induces another person to deliver any property is liable for the offence of cheating. Section 420 of IPC is a serious form of cheating that includes inducement in terms of delivery of property as well as valuable securities. This section is also applicable to matters where the destruction of the property is caused by way of cheating or inducement. Punishment for cheating provided under this section is up to 7 years and also makes the person liable to fine. To establish offence of cheating and inducement of deliver of property, following ingredient need to be proved :-
"1. The representation made by the person was false.
2. The accused had prior knowledge that the representation he made was false.
3. The accused made false representation with dishonest intention in order to deceive the person to whom it was made.
4. The act where the accused induced the person to deliver the property or to perform or to abstain from any act which the person would have not done or had otherwise committed."
11. Having gone through FIR on record, it appears that there is commercial transaction between first informant and accused.
Page 6 of 10 Uploaded by SATISH C. VEMULLA(HC00206) on Wed Feb 19 2025 Downloaded on : Wed Feb 19 22:24:21 IST 2025NEUTRAL CITATION R/CR.MA/2048/2016 JUDGMENT DATED: 17/02/2025 undefined First informant placed order of purchasing 120 ton basmati rice for Rs.15 lakhs, to be paid in the account of accused. MOU was executed between the parties and first installment of Rs.10 lakhs was paid by first informant on 29.05.2014 in the account of Asian Traders which is proprietor firm of accused. According to complainant, since accused has not delivered 120 ton Basmati Rice within time period, complainant seeks to cancel order and also seeks refund of money. According to complainant, the accused gave evasive denial and denied to refund advance payment. This has been pleaded as cause of action to file FIR.
12. At this stage, I may refer to para 36 of the judgment of Hon'ble Apex Court in the case of Vijay Kumar Ghai (supra). Para 36 reads as under :-
"36. Having gone through the complaint/FIR and even the chargesheet, it cannot be said that the averments in the FIR and the allegations in the complaint against the appellant constitute an offence under Section 405 & 420 IPC, 1860. Even in a case where allegations are made in regard to failure on the part of the accused to keep his promise, in the absence of a culpable intention at the time of making promise being absent, no offence under Section 420 IPC can be said to have been made out. In the instant case, there is no material to indicate that Appellants had any malafide intention against the Respondent which is clearly deductible from the MOU dated 20.08.2009 arrived between the parties."
13. In view of above, this Court finds that commercial transaction took place between the parties, where due to some misunderstanding 120 ton Basmati Rice is not supplied. Learned advocate Mr.Bharda referred to MOU and submitted that since Page 7 of 10 Uploaded by SATISH C. VEMULLA(HC00206) on Wed Feb 19 2025 Downloaded on : Wed Feb 19 22:24:21 IST 2025 NEUTRAL CITATION R/CR.MA/2048/2016 JUDGMENT DATED: 17/02/2025 undefined 100% advance payment is not made, order process was not started further. Be that as it may. It is clear as crystal that civil transaction between the parties has been given color of criminality. FIR if taken as it is, it does not constitute essential ingredients of criminal breach of trust or forgery. There can be no doubt that mere breach of contract is not itself a criminal offence, though it may give rise to the civil liability of damages.
14. In the case of Vesa Holdings Pvt. Ltd. & Anr. Vs. State of Kerala & Ors. [(2015) 8 SCC 293], Hon'ble Apex Court made the following observation:-
"13. It is true that a given set of facts may make out a civil wrong as also a criminal offence and only because a civil remedy may be available to the complainant that itself cannot be ground to quash a criminal proceeding. The real test is whether the allegations in the complaint disclose the criminal offence of cheating or not. In the present case, there is nothing to show that at the very inception there was any inception on behalf of an accused person to cheat which is a condition precedent for an offence u/s 420 IPC. In our view, the complaint does not disclose any criminal offence at all. Criminal proceedings should not be encouraged when it is found to be mala fide or otherwise an abuse of the process of the courts. Superior courts while exercising this power should also strive to serve the ends of justice. In our opinion, in view of these facts allowing the police investigation to continue would amount to an abuse of the process of the court and the High Court committed an error in refusing to exercise the power under Section 482 Cr.P.C to quash the proceedings."
15. In the case of Indian Oil Corpn. v NEPC India Ltd. & Ors. [(2006) 6 SCC 736] a two-judge Bench of Hon'ble Apex Court reviewed the precedents on the exercise of jurisdiction under Section 482 of the Code of Criminal Procedure 1973 and Page 8 of 10 Uploaded by SATISH C. VEMULLA(HC00206) on Wed Feb 19 2025 Downloaded on : Wed Feb 19 22:24:21 IST 2025 NEUTRAL CITATION R/CR.MA/2048/2016 JUDGMENT DATED: 17/02/2025 undefined formulated guiding principles in the following terms:
"12. ... (i) A complaint can be quashed where the allegations made in the complaint, even if they are taken at their face value and accepted in their entirety, do not prima facie constitute any offence or make out the case alleged against the accused. For this purpose, the complaint has to be examined as a whole, but without examining the merits of the allegations. Neither a detailed inquiry nor a meticulous analysis of the material nor an assessment of the reliability or genuineness of the allegations in the complaint, is warranted while examining prayer for quashing of a complaint.
(ii) A complaint may also be quashed where it is a clear abuse of the process of the court, as when the criminal proceeding is found to have been initiated with mala fides/ malice for wreaking vengeance or to cause harm, or where the allegations are absurd and inherently improbable.
(iii) The power to quash shall not, however, be used to stifle or scuttle a legitimate prosecution. The power should be used sparingly and with abundant caution.
(iv) The complaint is not required to verbatim reproduce the legal ingredients of the offence alleged. If the necessary factual foundation is laid in the complaint, merely on the ground that a few ingredients have not been stated in detail, the proceedings should not be quashed. Quashing of the complaint is warranted only where the complaint is so bereft of even the basic facts which are absolutely necessary for making out the offence.
(v) .."
16. In the case of in State of Madhya Pradesh Vs. Awadh Kishore Gupta & Ors. [(2004) 1 SCC 691, the Hon'ble Apex Court made the following observation :-
"11. The powers possessed by the High Court under Section 482 of the Code are very wide and the very plenitude of the power requires great caution in its exercise. Court must be careful to see that its decision in exercise of this power is based on sound principles. The inherent power should not be exercised to stifle a Page 9 of 10 Uploaded by SATISH C. VEMULLA(HC00206) on Wed Feb 19 2025 Downloaded on : Wed Feb 19 22:24:21 IST 2025 NEUTRAL CITATION R/CR.MA/2048/2016 JUDGMENT DATED: 17/02/2025 undefined legitimate prosecution. High Court being the highest Court of a State should normally refrain from giving a prima facie decision in a case where the entire facts are incomplete and hazy, more so when the evidence has not been collected and produced before the Court and the issues involved, whether factual or legal, are of magnitude and cannot be seen in their true perspective without sufficient material. Of course, no hard and fast rule can be laid down in regard to cases in which the High Court will exercise its extraordinary jurisdiction of quashing the proceeding at any stage. In proceeding instituted on complaint, exercise of the inherent powers to quash the proceedings is called for only in a case where the complaint does not disclose any offence or is frivolous, vexatious or oppressive. If the allegations set out in the complaint do not constitute the offence of which cognizance has been taken by the Magistrate, it is open to the High Court to quash the same in exercise of the inherent powers under Section 482 of the Code."
17. In view of above, allowing FIR further into trial would be abuse of process of law. Criminal proceedings started is found to be initiated with intention of taking vengeance by giving civil litigation color of criminality. The petition deserves consideration.
18. For the foregoing reasons, the petition is allowed. FIR being C.R.No.I-10 of 2016 registered with Gotri Police Station, Vadodara City as well as consequential proceedings initiated in pursuance thereof qua present petitioners is quashed and set aside. Rule is made absolute to the aforesaid extent.
(J. C. DOSHI,J) SATISH Page 10 of 10 Uploaded by SATISH C. VEMULLA(HC00206) on Wed Feb 19 2025 Downloaded on : Wed Feb 19 22:24:21 IST 2025