Madhya Pradesh High Court
Pramod Vishvaiya vs The State Of Madhya Pradesh Thr on 20 January, 2020
Equivalent citations: AIRONLINE 2020 MP 1042
Author: Gurpal Singh Ahluwalia
Bench: Gurpal Singh Ahluwalia
1
THE HIGH COURT OF MADHYA PRADESH
MCRC No.22856/2018
Pramod Vishvaiya vs. State of M.P. & Anr.
Gwalior, Dated :20/01/2020
Shri Pallav Tripathi, Counsel for the applicant.
Shri R.K. Upadhyay, Public Prosecutor for the respondent
No.1/State.
Shri Mayank Bajpai, Counsel for the respondent No.2.
This application under Section 482 of Cr.P.C. has been filed for quashing the order dated 16.5.2018 passed by 10 th Additional Sessions Judge, Gwalior in Criminal Revision No.453/2017 by which the order dated 22.8.2017 passed by JMFC, Gwalior in Criminal Case No.1343/2017 has been affirmed and the application filed under Section 239 of Cr.P.C. has been rejected.
2. The necessary facts for disposal of the present application in short are that the sister of the applicant namely Smt. Krishna Mahobiya lodged a FIR against the applicant that a company was constituted in the name of Mangeshi Construction Company and was got registered. The complainant has invested an amount of Rs.30,00,000/-. It was further alleged by the complainant that she has 50% share in the company and the account is being maintained by the partnership firm only. The machinery was purchased after taking loan of Rs.20,00,000/- and the house has been placed under the collateral security. However, the applicant has taken away the 2 THE HIGH COURT OF MADHYA PRADESH MCRC No.22856/2018 Pramod Vishvaiya vs. State of M.P. & Anr.
machinery which has been purchased for the purposes of execution of work for the company.
3. It is alleged by the counsel for the applicant that in fact the complainant by lodging the FIR has tried to convert the civil case into criminal case. The allegations made against the applicant in the complaint are false. There is no embezzlement of funds. The FIR was lodged by the police in a most casual manner in compliance of the order dated 15.6.2016 passed by this Court in W.P.No.3573/2016. It is further submitted that in order to make out an offence under Section 406 of IPC, ingredients of Section 405 of IPC has to be established and the complainant must prove that the accused was interested that the property which has been dishonestly misappropriated or converted to his own house. It is submitted that the property is in the name of the company. The loan has been taken, charge of the Bank was created and there is absolutely no document in relation to the property being converted and misappropriated or used against any specific direction.
4. Further, I.A.No. 2477/2019 has been filed for taking additional documents on record and the applicant has sought to rely upon the accounts of the partnership firm, balance sheet, purchase of machinery, payment for machinery, payment of loan 3 THE HIGH COURT OF MADHYA PRADESH MCRC No.22856/2018 Pramod Vishvaiya vs. State of M.P. & Anr.
amount and other documents to show that there is a commercial dispute between the parties.
5. Per contra, it is submitted by the counsel for the State that it is well established principle of law that every commercial transaction will necessary involved a civil ingredients and merely because the civil elements is also present, the criminal case should not be quashed.
6. Heard the learned counsel for the parties.
7. The Supreme Court in the case of Indian Oil Corporation vs. NEPC India Ltd. & Ors. reported in (2006) 6 SCC 736 has held as under:-
12. The principles relating to exercise of jurisdiction under Section 482 of the Code of Criminal Procedure to quash complaints and criminal proceedings have been stated and reiterated by this Court in several decisions. To mention a few--Madhavrao Jiwajirao Scindia v.
Sambhajirao Chandrojirao Angre, State of Haryana v. Bhajan Lal, Rupan Deol Bajaj v. Kanwar Pal Singh Gill, Central Bureau of Investigation v. Duncans Agro Industries Ltd., State of Bihar v. Rajendra Agrawalla, Rajesh Bajaj v. State NCT of Delhi, Medchl Chemicals & Pharma (P) Ltd. v. Biological E. Ltd., Hridaya Ranjan Prasad Verma v. State of Bihar, M. Krishnan v. Vijay Singh and Zandu Pharmaceutical Works Ltd. v. Mohd. Sharaful Haque. The principles, relevant to our purpose are:
(i) A complaint can be quashed where the 4 THE HIGH COURT OF MADHYA PRADESH MCRC No.22856/2018 Pramod Vishvaiya vs. State of M.P. & Anr.
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) A given set of facts may make out: (a) purely a civil wrong; or (b) purely a criminal offence; or (c) a civil wrong as also a criminal offence. A commercial transaction or a contractual dispute, apart from furnishing a cause of action for seeking remedy in civil law, 5 THE HIGH COURT OF MADHYA PRADESH MCRC No.22856/2018 Pramod Vishvaiya vs. State of M.P. & Anr.
may also involve a criminal offence. As the nature and scope of a civil proceeding are different from a criminal proceeding, the mere fact that the complaint relates to a commercial transaction or breach of contract, for which a civil remedy is available or has been availed, is not by itself a ground to quash the criminal proceedings. The test is whether the allegations in the complaint disclose a criminal offence or not.
The Supreme Court in the case of Trisuns Chemical Industry vs. Rajesh Agarwal & Ors. reported in (1999) 8 SCC 686 has held as under:-
7. Time and again this Court has been pointing out that quashing of FIR or a complaint in exercise of the inherent powers of the High Court should be limited to very extreme exceptions (vide State of Haryana v. Bhajan Lal and Rajesh Bajaj v. State NCT of Delhi).
8. In the last referred case this Court also pointed out that merely because an act has a civil profile is not sufficient to denude it of its criminal outfit. We quote the following observations: (SCC p. 263, para 10) "10. It may be that the facts narrated in the present complaint would as well reveal a commercial transaction or money transaction.
But that is hardly a reason for holding that the offence of cheating would elude from such a transaction. In fact, many a cheatings were committed in the course of commercial and also money transactions."
9. We are unable to appreciate the reasoning that the provision incorporated in the agreement for referring the disputes to arbitration is an effective substitute for a criminal prosecution 6 THE HIGH COURT OF MADHYA PRADESH MCRC No.22856/2018 Pramod Vishvaiya vs. State of M.P. & Anr.
when the disputed act is an offence. Arbitration is a remedy for affording reliefs to the party affected by breach of the agreement but the arbitrator cannot conduct a trial of any act which amounted to an offence albeit the same act may be connected with the discharge of any function under the agreement. Hence, those are not good reasons for the High Court to axe down the complaint at the threshold itself. The investigating agency should have had the freedom to go into the whole gamut of the allegations and to reach a conclusion of its own. Pre-emption of such investigation would be justified only in very extreme cases as indicated in State of Haryana v. Bhajan Lal.
The Supreme Court in the case of Kamaladevi Agarwal vs. State of W.B. & Ors. reported in (2002) 1 SCC 555 has held as under:-
9. Criminal prosecution cannot be thwarted at the initial stage merely because civil proceedings are also pending. After referring to judgments in State of Haryana v. Bhajan Lal and Rajesh Bajaj v. State NCT of Delhi this Court in Trisuns Chemical Industry v. Rajesh Agarwal held: (SCC p. 690, paras 7-8) "7. Time and again this Court has been pointing out that quashing of FIR or a complaint in exercise of the inherent powers of the High Court should be limited to very extreme exceptions (vide State of Haryana v. Bhajan Lal and Rajesh Bajaj v. State NCT of Delhi).
8. In the last referred case this Court also pointed out that merely because an act has a civil profile is not sufficient to denude it of its criminal outfit. We quote the following observations: (SCC p. 263, para 10) '10. It may be that the facts narrated in the 7 THE HIGH COURT OF MADHYA PRADESH MCRC No.22856/2018 Pramod Vishvaiya vs. State of M.P. & Anr.
present complaint would as well reveal a commercial transaction or money transaction. But that is hardly a reason for holding that the offence of cheating would elude from such a transaction. In fact, many a cheatings were committed in the course of commercial and also money transactions.' "
The Supreme Court in the case of Lalmuni Devi (Smt.) vs. State of Bihar & Ors. reported in (2001) 2 SCC 17 has held as under:-
8. There could be no dispute to the proposition that if the complaint does not make out an offence it can be quashed. However, it is also settled law that facts may give rise to a civil claim and also amount to an offence. Merely because a civil claim is maintainable does not mean that the criminal complaint cannot be maintained. In this case, on the facts, it cannot be stated, at this prima facie stage, that this is a frivolous complaint. The High Court does not state that on facts no offence is made out. If that be so, then merely on the ground that it was a civil wrong the criminal prosecution could not have been quashed.
The Supreme Court in the case of M. Krishnan vs. Vijay Singh & Anr. reported in (2001) 8 SCC 645 has held as under:
5. Accepting such a general proposition would be against the provisions of law inasmuch as in all cases of cheating and fraud, in the whole transaction, there is generally some element of civil nature. However, in this case, the allegations were regarding the forging of the documents and acquiring gains on the basis of such forged documents. The proceedings could 8 THE HIGH COURT OF MADHYA PRADESH MCRC No.22856/2018 Pramod Vishvaiya vs. State of M.P. & Anr.
not be quashed only because the respondents had filed a civil suit with respect to the aforesaid documents. In a criminal court the allegations made in the complaint have to be established independently, notwithstanding the adjudication by a civil court. Had the complainant failed to prove the allegations made by him in the complaint, the respondents were entitled to discharge or acquittal but not otherwise. If mere pendency of a suit is made a ground for quashing the criminal proceedings, the unscrupulous litigants, apprehending criminal action against them, would be encouraged to frustrate the course of justice and law by filing suits with respect to the documents intended to be used against them after the initiation of criminal proceedings or in anticipation of such proceedings. Such a course cannot be the mandate of law. Civil proceedings, as distinguished from the criminal action, have to be adjudicated and concluded by adopting separate yardsticks. The onus of proving the allegations beyond reasonable doubt, in a criminal case, is not applicable in the civil proceedings which can be decided merely on the basis of the probabilities with respect to the acts complained of. The High Court was not, in any way, justified to observe:
"In my view, unless and until the civil court decides the question whether the documents are genuine or forged, no criminal action can be initiated against the petitioners and in view of the same, the present criminal proceedings and taking cognizance and issue of process are clearly erroneous."
8. It appears that the applicant has tried to rely upon certain documents which are not the part of the charge sheet.
9. The Supreme Court in the case of State of Orissa vs. 9 THE HIGH COURT OF MADHYA PRADESH MCRC No.22856/2018 Pramod Vishvaiya vs. State of M.P. & Anr.
Devendra Nath Padhi reported in (2005) 1 SCC 568 has held as under:
"Any document or other thing envisaged under the aforesaid provision can be ordered to be produced on finding that the same is 'necessary or desirable for the purpose of investigation, inquiry, trial or other proceedings under the Code'. The first and foremost requirement of the section is about the document being necessary or desirable. The necessity or desirability would have to be seen with reference to the stage when a prayer is made for the production. If any document is necessary or desirable for the defence of the accused, the question of invoking Section 91 at the initial stage of framing of a charge would not arise since defence of the accused is not relevant at that stage. When the section refers to investigation, inquiry, trial or other proceedings, it is to be borne in mind that under the section a police officer may move the Court for summoning and production of a document as may be necessary at any of the stages mentioned in the section. In so far as the accused is concerned, his entitlement to seek order under Section 91 would ordinarily not come till the stage of defence. When the section talks of the document being necessary and desirable, it is implicit that necessity and desirability is to be examined considering the stage when such a prayer for summoning and production is made and the party who makes it whether police or accused. If under Section 227 what is necessary and relevant is only the record produced in terms of Section 173 of the Code, the accused cannot at that stage invoke Section 91 to seek production of any document to show his innocence. Under Section 91 summons for production of document can be issued by Court and under a written order an officer in charge of police station can also direct production thereof. Section 91 does not confer any right on 10 THE HIGH COURT OF MADHYA PRADESH MCRC No.22856/2018 Pramod Vishvaiya vs. State of M.P. & Anr.
the accused to produce document in his possession to prove his defence. Section 91 presupposes that when the document is not produced process may be initiated to compel production thereof."
10. Thus this Court while considering the application under Section 482 of Cr.P.C. cannot look into the defence of the parties which requires formal proof. Both the Courts below considered the allegations and have come to a conclusion that merely because there is some arbitration proceedings, the prosecution of the applicant is liable to be quashed. Furthermore, there are specific allegations that there is prima facie material to frame the charge under Section 406 of IPC.
11. Under these circumstances, this Court is deliberately avoiding in giving any observation with regard to the merits of the case at this stage because it may prejudice the mind of the Trial Court. However, the basic allegations are that the complainant has substantially contributed in the partnership firm and the property was entrusted to the applicant and the applicant has not given the details and has misappropriated the funds.
12. Accordingly, the application fails and is hereby dismissed.
(G.S. Ahluwalia)
(alok) Judge
ALOK KUMAR
2020.02.12 10:27:02
+05'30'