Jammu & Kashmir High Court - Srinagar Bench
Miss Archana Kumar Sethi vs Mohammad Rafiq Sofi on 11 March, 2022
Author: Javed Iqbal Wani
Bench: Javed Iqbal Wani
HIGH COURT OF JAMMU & KASHMIR AND LADAKH
AT SRINAGAR
Reserved on: 24.02.2022
Pronounced on: 11.03.2022
CRMC No. 245/2015
Miss Archana Kumar Sethi ...PETITIONER(S)
Chief Executive Trans World Enterprises
Through: - Mr. R.A. Jan, Sr. Advocate with
Mr. Taha Khalil, Advocate.
Vs.
Mohammad Rafiq Sofi, Sole ...RESPONDENT(S)
Proprietor New Snowbar Bakery Gulab Bagh Sgr.
Through: - Mr. Azhar-Ul Amin, Advocate.
CORAM:HON'BLE MR. JUSTICE JAVED IQBAL WANI, JUDGE
JUDGMENT
1) Inherent jurisdiction under Section 482 Cr.P.C is being invoked by the petitioner for quashment of the complaint (hereinafter referred to as the "impugned complaint) instituted by the respondent herein against the petitioner under Sections 406 and 420 RPC together with the process issued thereupon by the Judicial Magistrate (1st Additional Munsiff), Srinagar (hereinafter referred to as the "trial Court") vide order dated 27.06.2015.
2) The facts under the shade and cover of which the instant petition has been filed are in brief detailed hereunder:-
The complainant-respondent herein is stated to have approached the Trans World Enterprises, of which the 2 CRMC No. 245/2015 petitioner herein is stated to be the Chief Executive at its office in New Delhi while introducing himself to be an owner of a Bakery, desiring to set up an Oven of latest technology therein;
The complainant-respondent herein is stated to have been briefed by the Manager on duty about the Ovens of latest technology being manufactured by the business concern of the petitioner herein and consequently, the complainant-
respondent herein is stated to have offered to purchase an Oven at the total price of Rs. 14,50,000/-. An amount of Rs. 2.00 lacs is stated to have been paid by the complainant-respondent herein on 29.08.2013, followed by a further payment of Rs. 2.00 lacs dated 03.09.2013 and Rs. 2.00 lacs on 10.09.2013 against payment receipts issued by the business concern of the petitioner.
A sale contract is also stated to have been entered into by the business concern of the petitioner with the complainant-respondent herein, reflected in proforma invoice dated 17.09.2013, providing as under:-
Terms and conditions:-
1. All the above prices and ex-showroom, New Delhi.
2. Payment-100% advance Bank Details are:-
Name-Trans World Enterprises SWIFT Code UBININBBNDL Account No. 355705040133307 IFSC Code-UBIN0535575 3 CRMC No. 245/2015 Bank Name-Union Bank of India Kailash Colony Market, New Delh-110048 It is being stated that pursuant to an E-mail dated 18.09.2013, sent by the business concern of the petitioner, the complainant-respondent herein was requested to arrange the payment of balance amount of Rs. 7,53,750/-
in order to enable it to dispatch the Oven in question for delivery to the complainant-respondent herein. It is being next stated that the complainant-respondent herein, however, failed to fulfil his part of the sale contract in making the payment of the balance sum and on account of his failure, the Oven in question could not be dispatched and delivered by the business concern of the petitioner to the complainant-respondent herein.
It is further being stated that instead of making the payment of the balance sum, the complainant-respondent herein served a legal notice dated 04.03.2015 on the petitioner being Chief Executive of the Trans World Enterprises, followed by another legal notice dated 08.06.2015, calling upon the petitioner to return the money, amounting to Rs.10, 50,000/- along with interest @ 18% on account of the failure to deliver the Oven in question.
The notice dated 08.06.2015 is stated to have been replied by the petitioner on 08.07.2015, contending therein that the 4 CRMC No. 245/2015 claim lodged in the notice is illegal, malafide and vexatious having been made with a view to tease, harass and blackmail the petitioner while calling upon the counsel for the complainant-respondent herein to withdraw the notice and also to desist from making dubious and fraudulent claims against the petitioner herein. The impugned complaint is stated to have been instituted on 27.06.2015 in the Court of learned Chief Judicial Magistrate, Srinagar, wherefrom the same is stated to have been transferred to the files of the trial Court.
3) The petitioner challenges the impugned complaint, the order of cognizance/process issued on 27.06.2015, as also the order dated 19.10.2015, inter alia, amongst others on the grounds, which are extracted in extenso hereunder:-
(A) Bare glance at the Complaint would show that the allegations made by the respondent in the complaint clearly disclose purely a civil transaction falling in the realm of Sale Contract qua Rational Oven Model SCC201E regulated and governed by the mutually agreed terms and conditions duly evidenced by the Proforma Invoice dated 17.09.2013 and thus taken on their face value do not disclose any of the ingredients of the Offence punishable under Section 406 read with Section 420 RPC rendering in sequel thereto the impugned Complaint as well as the impugned process issued thereon by the Court below vide Order dated 27.06.2015 initiating criminal proceedings against the petitioner without any warrant, authority or sanction of law liable to be quashed to prevent the abuse of process of Court and to secure the ends of justice.
(B) For that in law Criminal law can be set into motion only when the facts/allegations made in a complaint disclose a cognizable offence and not otherwise.
It is further submitted that in the present case even though the ingredients of the offences alleged against the petitioner are conspicuous by absence, yet the Ld. Magistrate (First Additional Munsiff), Srinagar has vide 5 CRMC No. 245/2015 impugned order dated 27.06.2015 issued, in a most mechanical and perfunctory manner, process against the petitioner clearly and manifestly in grave abuse of process of law, rendering in sequel thereto the impugned Complaint and the impugned process as well as the Criminal proceedings initiated thereupon against the petitioner liable to be quashed under Section 561-A Cr.P.C in order to prevent the abuse of process of law and also to secure the ends of justice.
(C) For that regard being had of the mandate of Constitutional Guarantees guaranteed to the petitioner under Article 21 of the Constitution of India coupled with indubitable fact that the Complaint does not on the face of it disclose any offence punishable under any Penal Law of the Land, the impugned Complaint as well as the impugned process initiated thereupon against the petitioner not only offend against the very mandate of the Constitutional Guarantees guaranteed to the petitioner under Article 21 of the Constitution of India but also constitutes grave abuse of process of law, attracting in the facts and circumstances of the case the applicability of the power and jurisdiction as by law vested in this Hon'ble Court under Section 561-A Cr.P.C in order to prevent the abuse of process of law from being perpetuated and also to secure the ends of justice.
(D) For that the impugned process issued against the petitioner on the basis of the impugned complaint in view of the stark fact apparent on the face of the complaint detailed herein above is clearly fraught with disastrous consequences of degenerating the legal process into a weapon of persecution and harassment, violating thereby with impunity the very mandate of the Constitutional guarantees, guaranteed to the petitioner under Article 21 of the Constitution of India as well as mandate of Rules of Law guaranteed under Article 14 of the Constitution of India. Therefore, in vindication the mandate of Constitutional Guarantees supra as well as the mandate of Rule of law, the impugned Complaint together with all the consequential proceedings including the impugned process issued in pursuance thereto against the petitioner be quashed in order to prevent the grave abuse of process of law and also to secure the ends of justice."
Heard learned counsel for the parties and perused the record.
4) Before adverting to the rival submissions made by the appearing counsel for the parties, it would be appropriate to refer to the criminal breach of trust as contained in Section 405/406 RPC and cheating and dishonestly inducing delivery of property as contained in Section 420 RPC.
6 CRMC No. 245/2015
5) Sections 405 & 406 RPC read as under:-
"405. Criminal breach of trust.--Whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied, which he has made touching the discharge of such trust, or willfully suffers any other person so to do, commits "criminal breach of trust."
"406. Punishment for criminal breach of trust.--Whoever commits criminal breach of trust shall be punished with imprisonment of either description for a term which may extend to three years, or with fine, or with both." A perusal of the Section 405 RPC (supra) would reveal that in order to constitute an offence of criminal breach of trust, the following ingredients must exist:-
(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 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;
In view of above, an offence of criminal breach of trust can said to have been committed only when all the ingredients of the offence, as defined above are found to have been satisfied. The accused must have been entrusted with property or dominion over it and the accused must have misappropriated the property or disposed of that property in violation of that trust. The most crucial expression in the commission of offence of criminal breach of trust is 7 CRMC No. 245/2015 "entrustment", upon which fulcrum is pivotted the entire scheme of the relevant provision of law relating to the criminal breach of trust. A trust implies confidence placed by one man in another. Section 405 RPC is not attracted in absence of proof of entrustment of property or dominion over the property of another and in absence of proof of dishonest intention.
6. Insofar as Section 420 RPC is concerned, the same reads as under:-
"420. Cheating and dishonestly inducing delivery of property.- Whoever cheats and thereby dishonestly induces the person deceived to deliver any property to any person or to make, alter or destroy the whole or any part of a valuable security, or anything which is signed or sealed, and which is capable of being converted into a valuable security, shall be punished with imprisonment of either description for a terms which may extend to seven years, and shall also be liable to fine."
A bare perusal of the provision (supra) would demonstate that 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.
Thus, for a person to be convicted under Section 420 RPC, it has to be established not only that he has cheated someone, but also 8 CRMC No. 245/2015 that by doing so, he has dishonestly induced the person, who was cheated to deliver any property. For an offence of cheating, it must be proved that the complainant parted with his property, acting on a representation, which was false to the knowledge of the accused and that the accused had a dishonest intention from the outset.
A conjoint reading of the aforesaid provisions, thus, would distinguish between an offence of criminal breach of trust and cheating, as that when for cheating, criminal intention is necessary at the time of entrustment, mere proof of entrustment is sufficient in criminal breach of trust.
7. Turning to the facts of the case, the legal notice dated 04.03.2015 served by the complainant-respondent herein upon the petitioner in explicit terms provided that the complainant-respondent herein placed an order before the petitioner herein for supply of baking Oven and that the delivery was required to be made within three months from the placement of the order made in the month of August, 2013 and that out of the settled price of Rs. 14,50,000/-, 50% was paid and 50% was payable upon delivery of the product and that instead of the 50%, an amount of Rs. 10, 50,000/- had been paid by the complainant-respondent herein to the petitioner and despite that payment, the petitioner did not dispatch/deliver the baking Oven as per the terms of the agreement.
The notice (supra) further provided that on account of non- delivery of the Oven in question, the complainant-respondent herein suffered huge loss in terms of the damage to the ancillary/supporting 9 CRMC No. 245/2015 infrastructure procured for the said baking Oven and consequently cost a lot to the complainant-respondent herein in terms of loss of business and reputation. It further gets revealed from the perusal of the said notice that the complainant-respondent herein demanded the return of the money paid by him to the business concern of the petitioner along with interest.
On the contrary, the perusal of the complaint would demonstrate a different stand taken by the complainant-respondent herein, wherein the complainant-respondent has contended that the complainant was approached by the petitioner herein for supply of baking Oven in the month of August, 2013 and that the petitioner herein despite receiving 70% of the payment did not deliver the Oven as promised and instead avoided the complainant, whereafter the complainant came to know that the petitioner is a fraud and cheat person, routinely dubbing the people and grabbing their hard earned money.
8. Having regard to the aforesaid analysis of Section 406 RPC, complaint and the record of the case available, it can safely be said that there is nothing either in the complaint or in the statements of the complainant, as also of his witnesses that the money was entrusted to the petitioner by the complainant-respondent herein and that the petitioner had dominion over the said money, which she converted to her own use so as to satisfy the ingredients of Section 405 RPC punishable under Section 406 RPC, thus, it cannot be said even prima- 10 CRMC No. 245/2015 facie that the petitioner committed any offence punishable under Section 406 RPC since the ingredients of that offence are not satisfied.
9. As has been notice in the preceding paras, in arriving at a conclusion as to whether the offence of cheating has been committed and in determining the said question, it has to be kept in mind that the distinction between mere breach of contract and the offence of cheating is a fine one. Mere breach of contract cannot give rise to criminal prosecution for cheating unless fraudulent or dishonest intention is shown at the beginning of the transaction.
There is a long line of decisions rendered by the Apex Court in this regard. A reference to "Hridaya Ranjan Prasad Verma and ors. Vs. State of Bihar and Anr., reported in 2000 (4) SCC 168", "Vesa Holdings Private Limited and Another Vs. State of Kerala and ors., reported in 2015 (8) SCC 293" and "G.V. Rao Vs. L. H. V. Prasad, reported in 2000(3) SCC 693" would be advantageous being relevant and germane herein, wherein at paras-15, 12 and 7 respectively, following has been noticed and laid down:-
"15. .........To hold a person guilty of cheating it is necessary to show that he had fraudulent or dishonest intention at the time of making the promise. From his mere failure to keep up promise subsequently such a culpable intention right at the beginning, that is, when he made the promise cannot be presumed."
"....12. From the decisions cited by the appellant, the settled proposition of law is that every breach of contract would not give rise to an offence of cheating and only in those cases breach of contract would amount to cheating where there was any deception played at the very inception. If the intention to cheat has developed later on, the same cannot amount to cheating. In other words for the purpose of constituting an offence of cheating, the complainant is required to show that the accused had 11 CRMC No. 245/2015 fraudulent or dishonest intention at the time of making promise or representation. 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 initial promise being absent, no offence under Section 420 of the Indian Penal Code can be said to have been made out."
"7. ...........In order to constitute the offence of cheating, the intention to deceive should be in existence at the time when the inducement was offered."
A perusal of the complaint and record available on the file, inasmuch as, the case set up by the complainant-respondent herein tends to show that even the ingredients of the offence of cheating are missing in the instant case. The petitioner at the most can said to have been failed to keep up the promise qua the supplying of the Oven in question to the complainant-respondent herein and for the alleged breach thereof being a commercial transaction, it is open to the complainant-respondent herein to proceed against the petitioner for his redressal for recovery of money by way of damages for the loss caused, if any. A mere failure to keep a promise subsequently cannot be presumed as an act leading to cheating.
10. Insofar as exercise of inherent power enshrined under Section 482 Cr.P.C is concerned, law is settled and is no more res-integra that in exercise of the wholesome power vested in the High Courts under Section 482 Cr.P.C, the High Court is entitled to quash a proceeding, if it comes to the conclusion that allowing the proceedings to continue would be an abuse of process of the Court or that the ends of justice require that the proceedings ought to be quashed. The saving of the High Courts' inherent powers, both in civil and criminal matters, is 12 CRMC No. 245/2015 designed to achieve a solitary public purpose, which is that the Court proceedings ought not to be permitted to degenerate into a weapon of harassment or persecution. In a criminal case, the veiled object behind a lame prosecution, the very nature of the material on which the structure of the prosecution rests and the like would justify the High Court in quashing the proceedings in the interest of justice. The ends of justice are higher than the ends of mere law, though justice has got to be administered according to the laws made by the legislature.
A reference in regard to above to the latest judgment of the Apex Court passed in the case titled as, "Neeharika Infrastructure Pvt. Ltd. Vs. State of Maharashtra and ors., reported in 2021 SCC Online SC 315", would be relevant herein.
11. In view of the aforesaid analysis and the position of law discussed in the preceding paras, the submission of the counsel for the respondent that the petition is not maintainable under Section 482 Cr.P.C cannot said to be a potent argument against the case set up by the petitioner herein and the judgment of the Apex Court titled as, "Priti Saraf and Anr. Vs. State of NCT of Delhi and Anr., reported in 2021 SCC Online SC 206" relied upon by the learned counsel for the respondent does not lend any support to the case of the complainant-respondent herein.
12. Thus, having regard to the facts and circumstances of the case, the trial Court seemingly has committed a serious error while entertaining the impugned complaint and also in taking cognizance and issuing process thereof against the petitioner herein for offences 13 CRMC No. 245/2015 under Sections 406 and 420 RPC, when the acts alleged against the petitioner did not constitute said offences, satisfying their ingredients prima-facie.
13. For what has been analyzed, observed and considered hereinabove, the petition succeeds and is, accordingly, allowed, as a consequence whereof, the impugned complaint, cognizance order dated 27.06.2015, as also the order dated 19.10.2015 are quashed.
14. Petition is, accordingly, disposed of.
(Javed Iqbal Wani) Judge JAMMU 11.03.2022 "Ram Krishan"
Whether the order is speaking: Yes
Whether the order is reportable: Yes