Gujarat High Court
Dilipkumar Dahyalal Soni vs State Of Gujarat on 16 January, 2025
NEUTRAL CITATION
R/CR.MA/12469/2015 ORDER DATED: 16/01/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/CRIMINAL MISC.APPLICATION (FOR QUASHING & SET ASIDE
FIR/ORDER) NO. 12469 of 2015
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DILIPKUMAR DAHYALAL SONI & ORS.
Versus
STATE OF GUJARAT & ANR.
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Appearance:
MR JANAK D VARDEY(10910) for the Applicant(s) No. 1,2,3
MR.DIPEN F CHAUDHARI(6740) for the Respondent(s) No. 2
MR MANAN MEHTA, APP for the Respondent(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE DIVYESH A. JOSHI
Date : 16/01/2025
ORAL ORDER
1. By way of preferring present application under Section 482 of the Code of Criminal Procedure, 1973, the applicants seek to invoke inherent and extraordinary jurisdiction of this Court for quashing of the FIR being C.R.No.I-27 of 2015 registered with Deesa City North Police Station, District Banaskantha for the offence punishable under sections 406, 420, 504, 506(2) and 114 of the Indian Penal Code and proceedings of Criminal Case No.1562 of 2015 pending before the Court of learned Judicial Magistrate First Class, Deesa.
2. Pursuant to the registration of the aforesaid FIR, investigation has already been commenced and ultimately at the end of the day, the investigating Page 1 of 16 Uploaded by LAVKUMAR J JANI(HC00210) on Wed Jan 22 2025 Downloaded on : Wed Jan 22 22:00:31 IST 2025 NEUTRAL CITATION R/CR.MA/12469/2015 ORDER DATED: 16/01/2025 undefined officer concerned has filed charge-sheet against the accused persons before the competent Court which ultimately culminated into Criminal Case No.1562 of 2015.
3. The case of the prosecution in nutshell can be summarized as under:
3.1. The complainant is goldsmith and indulged in to the business of jewellery making. He has also obtained licence from the competent authority to lend money against the gold ornaments/gold. The applicant No.1 - original accused No.1 used to come to the shop of the complainant at regular intervals and complainant and accused No.1 were having good relationship since long and on one fine day applicant No.1 has demanded Rs.5,000/- from the complainant and complainant lent the said amount with 2% interest and at that relevant point of time accused No.1 has also handed over gold ornaments to the complainant and thereafter at regular intervals the accused No.1 used to come to the shop of the complainant and after depositing gold ornaments he used to borrow money from the complainant. It is alleged that during the period between 17.09.2011 to 12.10.2023, the accused No.1 borrowed total amount of Rs.18,00,000/- on 2% interest by depositing gold and silver jewellery.
The complainant has demanded the said amount time and again but reasons best known to the accused No.1 he has not repaid the said amount and at that relevant Page 2 of 16 Uploaded by LAVKUMAR J JANI(HC00210) on Wed Jan 22 2025 Downloaded on : Wed Jan 22 22:00:31 IST 2025 NEUTRAL CITATION R/CR.MA/12469/2015 ORDER DATED: 16/01/2025 undefined point of time accused Nos. 2 and 3, who happened to be the real brothers of accused No.1, had earlier given oral assurance to the complainant that within no time they arranged for money and repaid it to the complainant. After lapse of some time, complainant once again approached to the accused persons and demanded money but instead of paying the said amount and fulfilling the promise given to the complainant, the accused persons administered threats to the complainant, due to which, complainant was constrained to register the FIR against all the accused persons.
4. Heard learned advocate Mr. Janak Vardey for the applicants and learned APP Mr. Manan Mehta for the respondent - State.
5. Learned advocate Mr. Janak Vardey submits that immediately after registration of the FIR, the applicants have approached before this Court and considering the allegations and accusations levelled against the applicants, this Court has granted stay in favour of the applicants by giving specific direction to the concerned investigating officer not to carry out the investigation qua the impugned FIR. Despite that, the investigating officer has carried out investigation and filed charge-sheet before the concerned Court. As soon as the said fact has come to the notice of the applicants, immediately they approached before this Court by narrating the said Page 3 of 16 Uploaded by LAVKUMAR J JANI(HC00210) on Wed Jan 22 2025 Downloaded on : Wed Jan 22 22:00:31 IST 2025 NEUTRAL CITATION R/CR.MA/12469/2015 ORDER DATED: 16/01/2025 undefined fact and therefore the proceedings of Criminal Case No.1562 of 2015 pending before the learned trial Court have been stayed by this Court vide order dated 08.10.2015 and since then the trial is pending before the competent criminal court.
6. Learned advocate Mr. Vardey further submits that if this Court would go through the recitals of the allegations levelled in the body of the FIR, in that event, it would be found out that prima facie there was no entrustment or dominion over the property of the complainant. Therefore, bare reading of the compliant clearly goes no to show that with mala fide intention to harass the applicants, FIR in question has been filed by the original complainant by giving criminal colour to the civil dispute. He has submitted that it is the specific case of the complainant from very beginning that accused No.1 had borrowed money by depositing gold and silver jewellery before him. Therefore, if at all accused No.1 failed to repay the said amount within the prescribed time, in that event, it would be open for the complainant to recover the said amount by selling the gold ornaments or by filing a suit for recovery of the said amount. It is an admitted position of fact that up till now not a single litigation has been instituted by the complainant against the applicant and straight way FIR in question came to be filed which clearly goes on to demonstrate the arm twisting tactics adopted by the original complainant Page 4 of 16 Uploaded by LAVKUMAR J JANI(HC00210) on Wed Jan 22 2025 Downloaded on : Wed Jan 22 22:00:31 IST 2025 NEUTRAL CITATION R/CR.MA/12469/2015 ORDER DATED: 16/01/2025 undefined with a sole intent to rope the applicants in to the impugned false FIR.
7. Learned advocate Mr. Vardey further submits that applicant No.3 filed an application in the form of complaint to the Police Inspector, Deesa City (North) Police Station, District Banaskantha on 10.11.2014 by narrating the fact that complainant and two other persons used to come to his shop and administered threat and therefore appropriate action is required to be taken against the said persons. However, no actions were taken by the police authority. Thereafter the complainant has continued with his activity and therefore applicant No.3 was constrained to give another application on 09.12.2014. Those applications are part and parcel of the petition. Learned advocate Mr. Vardey further submits that despite the fact that the applicant No.3 has made applications to the Police Inspector concerned to initiate action against the complainant, no actions have been taken against him and on the contrary on one fine day, FIR in question has been filed by the complainant against him, which is nothing but an arm twisting tactic on the part of the complainant. Learned advocate Mr. Vardey further submits that in fact if the allegations and accusations levelled against the applicants are to be read, in that event, it can safely be said that no offence is made out against the applicants. In fact there was no actual transaction took place between the applicant Nos. 2 Page 5 of 16 Uploaded by LAVKUMAR J JANI(HC00210) on Wed Jan 22 2025 Downloaded on : Wed Jan 22 22:00:31 IST 2025 NEUTRAL CITATION R/CR.MA/12469/2015 ORDER DATED: 16/01/2025 undefined and 3 and complainant. It is alleged that applicant Nos. 2 and 3 have given assurance to the complainant that on a particular day they will bring amount from accused No.1 and give it back to the complainant and except that no any specific role is attributed to them. Learned advocate Mr. Vardey further submits that it is the settled proposition of law that powers under Section 482 of the Code can be exercised by this Court in extraordinary circumstances and looking to the allegations and accusations levelled against the applicants in the impugned FIR, this is a fit case where the Court can exercise its power under section 482 of the Code. He further submits that if this Hon'ble Court would make a cursory glance upon the allegations levelled against the applicants in the impugned FIR, in that event, it would be found out that right from the inception the intention of the applicants was not to deceive and cheat the complainant since at the time of borrowing the money, applicant No.1 has given his ornaments to the complainant as security. He further submits that in the FIR, no specific averments and allegations with regard to ill-intention of the applicants to deceive and cheat the complainant are there. Thus, no offence is made out against the applicants and applicants are innocent persons and falsely roped into the criminal offence. Hence, the FIR in question may be quashed. In support of his submissions, learned advocate Mr. Vardey has put reliance upon the following decisions:
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1. In case of Inder Mohan Goswami and another v. State of Uttaranchal and others, reported in 2008(1) GLH 603;
2. In Arvindbhai Maganlal Master v. State of Gujarat, 2015(1) GLH 149;
3. In Harjinder Singh Chanchad Singh Sachdev v. State of Gujarat, 2014 JX (Guj.) 975; and
4. In Arvindbhai Shantilal Modi v. State of Gujarat, 2014 JX (Guj.) 1004;
8. Learned advocate Mr. Vardey submits that in view of the ratio laid down by the Hon'ble Apex Court and by this Hon'ble Court in the aforesaid cases, the prosecution launched against the present applicants is required to be quashed and set aside.
9. Learned APP Mr. Manan Mehta appearing for the respondent - State has objected present application with vehemence and forcefully submitted that in fact by making cursory glance upon the body of the FIR, basic, essential and requisite ingredients to constitute the offence under Sections 406 and 420 are clearly established against the accused persons. He has read the FIR and submitted that pursuant to the registration of the FIR, investigation has already been carried out by the investigating officer concerned and subsequently charge-sheet has also been filed before the competent Court. During the course Page 7 of 16 Uploaded by LAVKUMAR J JANI(HC00210) on Wed Jan 22 2025 Downloaded on : Wed Jan 22 22:00:31 IST 2025 NEUTRAL CITATION R/CR.MA/12469/2015 ORDER DATED: 16/01/2025 undefined of investigation, statements of number of witnesses were recorded by the investigating officer which clearly goes on to show the active involvement of the applicants accused persons in commission of crime. Therefore, no error could be said to have been committed by the investigating officer to submit charge-sheet before the competent Court. Therefore, instant application preferred by the applicants is required to be quashed and set aside.
10. I have gone through the record and proceedings and also considered the arguments canvassed by learned advocates appearing for the respective parties. Before dwelling into the issue involved in the matter, at this juncture, I would like to refer to the observations made by the Hon'ble Apex Court in the case of Delhi Race Club (1940) Ltd. & Ors. v. State of Uttar Pradesh & Anr., 2024 INSC 626.
24. This Court in its decision in S.W. Palanitkar & Ors. v. State of Bihar & Anr. reported in (2002) 1 SCC 241 expounded the difference in the ingredients required for constituting an of offence of criminal breach of trust (Section 406 IPC) viz-a-viz the offence of cheating (Section 420). The relevant observations read as under: -
"9. The ingredients in order to constitute a criminal breach of trust are: (i) entrusting a person with property or with any dominion over property, (ii) that person entrusted (a) dishonestly misappropriating or converting that property to his own use; or (b) dishonestly Page 8 of 16 Uploaded by LAVKUMAR J JANI(HC00210) on Wed Jan 22 2025 Downloaded on : Wed Jan 22 22:00:31 IST 2025 NEUTRAL CITATION R/CR.MA/12469/2015 ORDER DATED: 16/01/2025 undefined using or disposing of that property or wilfully suffering any other person so to do in violation (i) of any direction of law prescribing the mode in which such trust is to be discharged, (ii) of any legal contract made, touching the discharge of such trust.
10. The ingredients of an offence of cheating are: (i) there should be fraudulent or dishonest inducement of a person by deceiving him, (ii)(a) the person so deceived should be induced to deliver any property to any person, or to consent that any person shall retain any property; or (b) the person so deceived should be intentionally induced to do or omit to do anything which he would not do or omit if he were not so deceived; and (iii) in cases covered by (ii)(b), the act of omission should be one which causes or is likely to cause damage or harm to the person induced in body, mind, reputation or property."
25. What can be discerned from the above is that the offences of criminal breach of trust (Section 406 IPC) and cheating (Section 420 IPC) have specific ingredients. In order to constitute a criminal breach of trust (Section 406 IPC): -
1) There must be entrustment with person for property or dominion over the property, and
2) The person entrusted: -
a) dishonestly misappropriated or converted property to his own use, or
b) dishonestly used or disposed of the property or willfully suffers any other person so to do in violation of:
i. any direction of law prescribing the method in which the trust is discharged; or Page 9 of 16 Uploaded by LAVKUMAR J JANI(HC00210) on Wed Jan 22 2025 Downloaded on : Wed Jan 22 22:00:31 IST 2025 NEUTRAL CITATION R/CR.MA/12469/2015 ORDER DATED: 16/01/2025 undefined ii. legal contract touching the discharge of trust (see: S.W.P. Palanitkar (supra).
Similarly, in respect of an offence under Section 420 IPC, the essential ingredients are: -
1) deception of any person, either by making a false or misleading representation or by other action or by omission;
2) fraudulently or dishonestly inducing any person to deliver any property, or
3) the consent that any persons shall retain any property and finally intentionally inducing that person to do or omit to do anything which he would not do or omit (see: Harmanpreet Singh Ahluwalia v. State of Punjab, (2009) 7 SCC 712 : (2009) Cr.L.J. 3462 (SC))
26. Further, in both the aforesaid sections, mens rea i.e. intention to defraud or the dishonest intention must be present, and in the case of cheating it must be there from the very beginning or inception.
27. In our view, the plain reading of the complaint fails to spell out any of the aforesaid ingredients noted above. We may only say, with a view to clear a serious misconception of law in the mind of the police as well as the courts below, that if it is a case of the complainant that offence of criminal breach of trust as defined under Section 405 of IPC, punishable under Section 406 of IPC, is committed by the accused, then in the same breath it cannot be said that the accused has also committed the offence of cheating as defined and explained in Section 415 of the IPC, punishable under Section 420 of the IPC.Page 10 of 16 Uploaded by LAVKUMAR J JANI(HC00210) on Wed Jan 22 2025 Downloaded on : Wed Jan 22 22:00:31 IST 2025
NEUTRAL CITATION R/CR.MA/12469/2015 ORDER DATED: 16/01/2025 undefined
28. Every act of breach of trust may not result in a penal offence of criminal breach of trust unless there is evidence of manipulating act of fraudulent misappropriation. An act of breach of trust involves a civil wrong in respect of which the person may seek his remedy for damages in civil courts but, any breach of trust with a mens rea, gives rise to a criminal prosecution as well.
xxx xxx xxx
38. If it is the case of the complainant that a particular amount is due and payable to him then he should have filed a civil suit for recovery of the amount against the appellants herein. But he could not have gone to the court of Additional Chief Judicial Magistrate by filing a complaint of cheating and criminal breach of trust.
39. It appears that till this date, the complainant has not filed any civil suit for recovery of the amount which according to him is due and payable to him by the appellants. He seems to have prima facie lost the period of limitation for filing such a civil suit.
40. In such circumstances referred to above, the continuation of the criminal proceeding would be nothing but abuse of the process of law.
11. For the purpose of constituting the offence of criminal breach of trust, following ingredients are required to be established by the prosecuting agency from the police papers.
1) There must be entrustment with person for property or dominion over the property, and
2) The person entrusted: -
a) dishonestly misappropriated or converted property to his own use, or Page 11 of 16 Uploaded by LAVKUMAR J JANI(HC00210) on Wed Jan 22 2025 Downloaded on : Wed Jan 22 22:00:31 IST 2025 NEUTRAL CITATION R/CR.MA/12469/2015 ORDER DATED: 16/01/2025 undefined
b) dishonestly used or disposed of the property or willfully suffers any other person so to do in violation of:
i. any direction of law prescribing the method in which the trust is discharged; or ii. legal contract touching the discharge of trust.
11.1.Similarly, for the offence under Section 420 IPC, the essential ingredients which are required to be established are:
1) deception of any person, either by making a false or misleading representation or by other action or by omission;
2) fraudulently or dishonestly inducing any person to deliver any property, or
3) the consent that any persons shall retain any property and finally intentionally inducing that person to do or omit to do anything which he would not do or omit.
12. It is well settled that in both the aforesaid sections, mens rea i.e. intention to defraud or the dishonest intention must be present, and in the case of cheating it must be there from the very beginning or inception. As observed by the Hon'ble Apex Court in the aforesaid decision, 'with a view to clear a serious misconception of law in the mind of the police as well as the courts below, that if it is a case of the complainant that offence of criminal breach of trust as defined under Section 405 of IPC, Page 12 of 16 Uploaded by LAVKUMAR J JANI(HC00210) on Wed Jan 22 2025 Downloaded on : Wed Jan 22 22:00:31 IST 2025 NEUTRAL CITATION R/CR.MA/12469/2015 ORDER DATED: 16/01/2025 undefined punishable under Section 406 of IPC, is committed by the accused, then in the same breath it cannot be said that the accused has also committed the offence of cheating as defined and explained in Section 415 of the IPC, punishable under Section 420 of the IPC'. 28. It is settled proposition of law that every act of breach of trust may not be resulted in a penal offence of criminal breach of trust unless there is express evidence available on record which clearly goes on to show that there was manipulating act of fraudulent misappropriation. An act of breach of trust involves a civil wrong in respect of which the person may seek his remedy for damages in civil courts but, any breach of trust with a mens rea, gives rise to a criminal prosecution as well. Admittedly, it is the specific case of the prosecution that at the time of borrowing the said amount certain ornaments were handed over by the accused No.1 to the complainant and all those ornaments are still lying with the complainant. It is also required to be noted that the complainant lent the said amount to the accused No.1 with a view to earn interest over the said amount. It is also brought to the notice of this Court by learned advocate appearing for the applicants that subsequently applicant No.1 made request to the complainant that due to certain unavoidable circumstances, despite his best efforts, he could not be able to repay the said amount due to scarcity and shortage of necessary fund and he is not in a Page 13 of 16 Uploaded by LAVKUMAR J JANI(HC00210) on Wed Jan 22 2025 Downloaded on : Wed Jan 22 22:00:31 IST 2025 NEUTRAL CITATION R/CR.MA/12469/2015 ORDER DATED: 16/01/2025 undefined position to repay the said amount in near future and therefore whatever ornaments he had given to the complainant at the time of borrowing the amount, the price of which came to be escalated, the complainant has to keep the said gold and silver ornaments within him and he can utilize the said ornaments as his own property. The said fact is also found out from the statements of the accused persons recorded by the investigating officer. The statement of the accused persons is also forming part of the present petition. The statements of witnesses have also been annexed along with the memo of the petition, which clearly demonstrate that the intention of applicant No.1 to cheat the complainant from the inception was also not there.
13. Thus, this Court is of the considered view that even if the allegations levelled against the applicants in the impugned FIR are taken at their face value and accepted in their entirety, keeping in view the facts of the present case and the penal provisions, they do not prima facie constitute any offence or make out a case against the accused persons, as per the parameters set out by the Hon'ble Apex Court in the case of State of Haryana v. Bhajan Lal, AIR 1992 SC 604 and in the case of R.P. Kapur v. State of Punjab, AIR 1960 SC 866. If it is the case of the complainant that a particular amount is due and payable to him then he should have filed a civil suit for recovery of the amount against the Page 14 of 16 Uploaded by LAVKUMAR J JANI(HC00210) on Wed Jan 22 2025 Downloaded on : Wed Jan 22 22:00:31 IST 2025 NEUTRAL CITATION R/CR.MA/12469/2015 ORDER DATED: 16/01/2025 undefined applicants herein but he could not have filed a complaint of cheating and criminal breach of trust. It is also found out from the record that till date the complainant has not filed any civil suit for recovery of the amount which according to him is due and payable to him by the applicants.
14. The scope and ambit of inherent powers of the Court under Section 482 Cr.P.C. or the extra-ordinary power under Article 226 of the Constitution of India, now stands well defined by series of judicial pronouncements. Undoubtedly, this Court has inherent power to do real and substantial justice, or to prevent abuse of the process of the Court. At the same time, the Court must be careful to see that its decision in exercise of this power is based on sound principles. The inherent power vested in the Court should not be exercised to stifle a legitimate prosecution. However, this Court can exercise its inherent power or extra-ordinary power if it comes to the conclusion that allowing the proceeding to continue would be an abuse of the process of the Court, or the ends of justice require that the proceeding ought to be quashed. Thus, considering the overall facts of the present case as well as the accusations and allegations levelled against the applicants in the impugned FIR, I am of the considered view that the chances of an ultimate conviction after full-fledged trial are bleak and Page 15 of 16 Uploaded by LAVKUMAR J JANI(HC00210) on Wed Jan 22 2025 Downloaded on : Wed Jan 22 22:00:31 IST 2025 NEUTRAL CITATION R/CR.MA/12469/2015 ORDER DATED: 16/01/2025 undefined continuation of criminal prosecution against the applicants accused is merely an empty formality and wastage of prestigious time of the Court. Thus, considering the ratio enunciated by the Hon'ble Apex Court in catena of decisions, I am of the opinion that the FIR in question deserves to be quashed.
15. In the result, the application succeeds and is hereby allowed. Accordingly, the FIR being C.R.No.I- 27 of 2015 registered with Deesa City North Police Station, District Banaskantha for the offence punishable under sections 406, 420, 504, 506(2) and 114 of the Indian Penal Code and proceedings of Criminal Case No.1562 of 2015 pending before the Court of learned Judicial Magistrate First Class, Deesa, are hereby quashed.
(DIVYESH A. JOSHI,J) LAVKUMAR J JANI Page 16 of 16 Uploaded by LAVKUMAR J JANI(HC00210) on Wed Jan 22 2025 Downloaded on : Wed Jan 22 22:00:31 IST 2025