Madras High Court
M/S. Tambraparni Containers P. Ltd vs Mr. A.P.Varghese on 8 October, 2014
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 08.10.2014
CORAM
THE HONOURABLE MR.JUSTICE S.NAGAMUTHU
Criminal Original Petition No.2008 of 2011
and M.P.Nos.1 & 2 of 2011
and M.P.No.1 of 2013
1. M/s. Tambraparni Containers P. Ltd.,
Represented by its Manager-in-charge,
V.Parthipan, S/o.Vasudevan
2. Mr. K.S.Sundaram,
S/o. Sundar Iyer,
Authorised Representative,
M/s.Tambrapani Container P. Ltd.,
3. Mr. V.Parthipan, S/o.Vasudevan,
M/s.Tambrapani Container P. Ltd., .. Petitioners / A-1 to A-3
Vs.
Mr. A.P.Varghese .. Respondent / complainant
Prayer: Criminal Original Petition filed under Section 482 of the Criminal Procedure Code to call for the records of the learned Judicial Magistrate No.1, Puducherry, in C.C.No.474 of 2009 on his file and to quash the proceedings therein against the petitioners herein.
For Petitioners : Mr. Niranjan Rajagopalan, for,
M/s.G.R.Associates
For Respondents : Mr. M.Kalyana Sundaram, Sr. Counsel,
for, M/s.R.Vasudevan
- - -
O R D E R
The petitioners are the accused in C.C.No.474 of 2009 on the file of the learned Chief Judicial Magistrate No.I, Puducherry. This is a case instituted on the private complaint preferred by the respondent. The learned Magistrate has taken cognizance on the said complaint of the offences under Sections 406, 420 read with Section 34 IPC. The petitioners have already made appearance before the lower court. Now, they are before this Court, seeking to quash the said case.
2. The facts of the case would be as follows:-
The first petitioner / first accused is a company. The second petitioner / second accused is stated to be the authorized signatory of the first petitioner / company. The third petitioner / third accused is stated to be the Manager In-charge of the first petitioner / company. It is alleged that the respondent entered into a lease agreement with the first accused / first petitioner / company, as per the negotiation held on 25.02.2008 between the petitioners and the respondent. A draft lease agreement, dated 25.02.2008 was made between the parties and as per the recitals of the same, the respondent / complainant has to pay a sum of Rs.6,39,750/- towards the interest free security deposit, which is refundable after the completion of the lease period, in tune with the break-up figures arrived in Article-2 of the draft lease agreement.
3. According to further recitals, the period of lease hold occupation was scheduled to be commenced from 14.04.2008. It is also stated that the respondent paid a sum of Rs.1,00,000/- on 27.02.2008 towards part- satisfaction of the interest free security deposit, as enshrined in the draft lease agreement. The second instalment to the tune of Rs.2,19,875/- was paid on 05.03.2008. The third instalment of Rs.3,19,875/- could not be paid on 14.04.2008 in terms of the agreement, because respondents 2 and 3 were not available to receive the amount. Thereafter, it is stated that the respondent sent a cheque bearing No.122174, dated 14.04.2008 drawn on State Bank of Trivancore, along with a letter, dated 14.04.2008, informing the accused about the efforts the respondent had taken to pay the balance of interest free security deposit, through courier service, on 14.04.2008 itself. But the cheque was rejected by the petitioners and thus, the third instalment was not realised by the petitioners.
4. The respondent gave 'stop payment instructions' to the Banker also. Thereafter, the petitioners have declined to repay the amount, which was already paid by way of two instalments. These acts of accused, according to the complainant, amount to offence punishable either under Section 406 IPC or under Section 420 IPC. With these allegations, the private complaint has been filed.
5. The petitioners, in this petition, would submit that these allegations would make out only pure and simple, a civil dispute and the allegations do not make out any offence warranting trial. The learned counsel for the petitioner would submit that, as per the agreement, if the respondent had committed any breach of terms of the agreement in paying instalments, the petitioners reserved their rights to foreclose the agreement and to forfeit the amount if any paid already. He would further submit that since the third instalment was not paid, in terms of the agreement, notice was sent to the respondent foreclosing the agreement and also forfeiting the two instalments paid already. Thus, according to the petitioners, the respondent committed clear breach of terms of the contract.
6. The learned counsel for the petitioners would further submit that based on the above agreement, the respondent filed a Civil Suit in O.S.No.43 of 2008 on the file of the learned Principal District Judge, Puducherry, for specific performance. In that suit, according to the learned counsel, a plea was taken by the petitioners herein that the respondent herein was not entitled for a decree of specific performance, because, he had committed breach of the terms of the agreement. The learned counsel would further point out that, on evidence, the learned Principal District Judge, Puducherry, declined to grant a decree for specific performance and instead, the learned Principal District Judge, decreed the suit, directing the petitioners to refund the amount received by them, by way of two instalments. The learned counsel would further submit that, as against the same, the petitioners filed an appeal in A.S.No.311 of 2013 before this Court and this Court, by a decree and judgment, dated 13.11.2013, modified the decree of the lower court in terms of Section 74 of the Indian Contract Act and directed the petitioners to pay back the instalment amount, but retaining only the rent. The learned counsel, relying on these facts, would submit that the present private complaint is a clear abuse of process of court and therefore, the interim stay granted already is liable to be set-aside.
7. Per contra, the learned senior counsel appearing for the respondent would submit that the allegations in the complaint clearly make out offences punishable either under Section 406 IPC or under Section 420 IPC. The learned senior counsel, across the Bar, would submit that though there are no materials to try the accused for the offence under Section 406 IPC, there are materials to try them for offence under Section 420 IPC. The learned senior counsel would further submit that the dispute in this case cannot be construed to be a pure civil dispute. The learned senior counsel would further submit that assuming that the respondent had a remedy before the civil court, that will not debar the respondent from prosecuting these petitioners, because they have committed clear offence of cheating under Section 420 IPC. In this regard, the learned senior counsel would rely on a judgment of the Hon'ble Supreme Court in the case of Indian Oil Corporation v. NEPC India Ltd., and Others, reported in (2006) 6 Supreme Court Cases 736 about which, I would make reference at the appropriate stage of this order.
8. The learned senior counsel for the respondent would further submit that, so far as the power of this Court under Section 482 of the Code of Criminal Procedure, to quash the criminal case is concerned, he would submit that this Court shall ordinarily exercise the said jurisdiction, inter-alia, in the event the allegations contained in the First Information Report or in the complaint petition, even if on its face value are taken to be correct in their entirety, does not disclose the commission of an offence. In the case of hand, according to the learned senior counsel, if this test is applied, it would certainly emerge that the complaint makes out an offence warranting trial and therefore, this Court should not exercise/invoke its jurisdiction under Section 482 of the Criminal Procedure Code.
9. I have considered the aforesaid submissions made by the learned counsel for both sides and perused the materials available on record carefully.
10. The learned senior counsel for the respondent, as I have already mentioned, has, across the Bar, conceded that the allegations in the complaint do not make out an offence under Section 406 IPC. Therefore, I do not venture to deal with the same elaborately.
11. The learned senior counsel for the respondent would submit, across the Bar, that the allegations make out only an offence punishable under Section 420 of the Indian Penal Code.
12. At the outset, therefore, let us have a quick look into the definition of the offence of 'cheating' as made in Section 415 of the Indian Penal Code, which reads as follows:-
415. Cheating. Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit if he were not 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, is said to cheat.
13. The term fraudulently has elaborately been defined in Section 25 of the Indian Penal Code, which reads as under:-
25. Fraudulently. A person is said to do a thing fraudulently if he does that thing with intent to defraud but not otherwise. ...
14. The term dishonestly has been defined in Section 24 of the Indian Penal Code, which reads thus:-
24. Dishonestly.Whoever does anything with the intention of causing wrongful gain to one person or wrongful loss to another person, is said to do that thing dishonestly.
15. These provisions have been considered by the Hon'ble Supreme Court and the High Courts, in various judgments, which do not require any introduction afresh, but it requires only a clear understanding.
16. A simple reading of these provisions would make it abundantly clear that basically, there should be an allegation that the act of the accused amounts to deception. Secondly, the persons, so deceived, should have been induced to deliver any property by any fraudulent or dishonest manner. In order to satisfy these essential requirements of Section 415 of the Indian Penal Code, there should be materials on record.
17. In the case on hand, as has been rightly contended by the learned counsel for the petitioners, absolutely there is nothing on record even to make out a prima facie case of deception. No-where, it is stated in the complaint that from the very inception, the accused deceived the respondent. Thus, the first essential ingredient has not been satisfied by the allegations made in the complaint. Further, there is absolutely no allegation that the accused acted either fraudulently or dishonestly, so as to induce the respondent to enter into the lease agreement. Thus, the second essential ingredient of Section 415 of the Indian Penal Code also has not been satisfied by means of any allegation in the complaint.
18. Per contra, as rightly pointed out by the learned counsel for the petitioners, the allegations make out a pure civil dispute. The allegations make out that the transaction was throughout honest and there was no fraudulent or dishonest inducement by these petitioners.
19. The learned senior counsel for the respondent would submit that even the breach of the terms of contract may make out an offence, in which case, the case cannot be quashed on the ground that the aggrieved has got remedy under civil law. For this proposition, the learned counsel has relied on Indian Oil Corporation's case, cited supra. But factually in that case, the Hon'ble Supreme Court, after having elaborately dealt with the scope of Section 415 of the IPC, in paragraph 36, has held as follows:-
36. In this case, the complaints clearly allege that the accused with fraudulent intention to cheat and defraud the IOC, had induced IOC to resume supply of aircraft fuel on cash and carry basis, by entering into a further agreement dated 20.9.1997 and undertaking to clear the outstanding amount of Rs.18 crores approximately within the time stipulated in the Hypothecation Agreements. The sum and substance of the said allegation read with other averments extracted above, is that NEPC India, having committed default in paying the sum of Rs.18 crores, entered into a fresh agreement dated 20.9.1997 agreeing to clear the outstanding as per a fresh schedule, with the dishonest and fraudulent intention of pre-empting and avoiding any action by IOC in terms of the hypothecation deeds to take possession of the aircrafts. Though the supplies after 20.9.1997 were on cash and carry basis, the fraudulent intention is alleged to emanate from the promise under the said agreement to make payment, thereby preventing immediate seizure (taking possession) of the aircrafts by IOC. This allegation made in addition to the allegation relating to removal of engines, has been lost sight of by the High Court. All that is to be seen is whether the necessary allegations exist in the complaint to bring the case within section 415. We are clearly of the view that the allegations in the complaint constitute such an offence. We are not concerned with the proof of such allegations or ultimate outcome of trial at this stage.
20. As seen in paragraph 36 of the said judgment, the prosecution was not based on the original agreement entered into. It was based on the subsequent agreement in which the Hon'ble Supreme Court found that the accused had acted with fraudulent intention to cheat and defraud the Indian Oil Corporation Limited. Thus, the facts of the said case are completely distinguishable from the facts of the present case. In the instant case, as I have already pointed out, absolutely there is no material or allegation in the complaint that the accused acted dishonestly or fraudulently to induce the respondent to enter into the contract.
21. Undisputedly, based on the above agreement, a suit for specific performance was filed by the respondent. Had it been the case of the respondent that the lease agreement was procured, by fraud or acting dishonestly, he could not have filed the suit for specific performance, because such a suit for specific performance is maintainable only on a honest transaction resulting in a mutual agreement, where there is consensus-ad-idem between the parties. The very fact that the respondent filed a Civil Suit for specific performance would go a long way to show that the transaction was honest and there was no deception or inducement by fraud or dishonest act.
22. Apart from that, the Civil Court declined to grant decree for specific performance in favour of the respondent, because, according to the Civil Court, it was only the respondent, who had committed breach of the terms of the contract. Had it been the finding of the Civil Court that the petitioners had committed breach of the contract, then there may be some ground for the respondent to argue before this Court. But quite contrary to that, the civil court's findings are against the respondent. Above all, it was not at all the case of the respondent before the Civil Court that the agreement suffers from fraud or dishonesty. When that be so, in my considered opinion, the present private complaint is a clear abuse of process of Court.
23. The learned senior counsel for the respondent has placed reliance on the judgment of the Hon'ble Supreme Court in Mahesh Chaudhary v. State of Rajasthan, reported in (2009) 4 Supreme Court Cases 439, in order to remind the Court, the limitations on the power of this Court under Section 482 of the Criminal Procedure Code, in the matter of quashing a private complaint. In paragraph 11 of the said judgment, the Hon'ble Supreme Court has stated as follows:-
11. The principle providing for exercise of the power by a High Court under Section 482 of the Code of Criminal Procedure to quash a criminal proceeding is well known. The court shall ordinarily exercise the said jurisdiction, inter alia, in the event the allegations contained in the FIR or the Complaint Petition even if on face value are taken to be correct in their entirety, does not disclose commission of an offence.
24. Regarding the above legal proposition, there can be no second opinion or quarrel. Even the learned counsel for the petitioner does not have any controversy over the said legal proposition. But, if the said legal proposition is applied to the facts of this case, what I would say is that, the complaint, on the face of it, does not make out any offence warranting trial. As I have already pointed out, the present private complaint is a pure and simple abuse of process of Court and therefore, it would be appropriate for this Court to exercise its power under Section 482 of the Criminal Procedure Code to quash the said case. Accordingly, I do.
25. In the result, this Criminal Original Petition is allowed and the case in C.C.No.474 of 2009 on the file of the learned Judicial Magistrate No.1, Puducherry, is hereby quashed. Consequently, the connected MPs are closed.
08.10.2014 Index : Yes / No Web : Yes / No srk To
1. Judicial Magistrate No.1, Puducherry S.NAGAMUTHU, J., srk Crl.O.P.No.2008 of 2011 & M.P.Nos.1 & 2 of 2011 & M.P.No.1 of 2013 08.10.2014