Allahabad High Court
Dashrath Nath Shukla And Another vs State Of U.P. And 2 Others on 22 February, 2021
HIGH COURT OF JUDICATURE AT ALLAHABAD ?Court No. - 76 Case :- APPLICATION U/S 482 No. - 13350 of 2020 Applicant :- Dashrath Nath Shukla And Another Opposite Party :- State Of U.P. And 2 Others Counsel for Applicant :- Pradeep Kumar Singh,Raj Kumar Pandey Counsel for Opposite Party :- G.A.,Kirtikar Pande Hon'ble Dinesh Kumar Singh-I,J.
Heard Sri Raj Kumar Pandey, learned counsel for the applicant, Sri Kirtikar Pande, learned counsel for the opposite party no. 3 and Sri G. P. Singh, learned A.G.A. for the State and perused the record.
This application under Section 482 Cr.P.C. has been filed with a prayer to quash the impugned charge sheet no. A-30 of 2019 dated 28.01.2019 and summoning order dated 20.02.2019 and non-bailable warrant dated 15.02.2020 passed by Chief Judicial Magistrate, Ballia in Criminal Case No. 210 of 2019, State v. Dashrath and others, arising out of Case Crime No. 307 of 2018, under Sections 406, 419, 420, 467, 468, 471, 504 & 506 of I.P.C., Police Station Kotwali, District Ballia pending in the court of Chief Judicial Magistrate, Ballia, with a further prayer to stay further proceeding in the aforesaid case.
As per F.I.R., which was lodged by the opposite party no. 3 Shail Rai, through the aid of Section 156(3) Cr.P.C. It has been stated that in the month of December, 2018, at about 10:00AM, the accused applicant no. 1 Dashrath Nath Shukla who is a retired branch manager of Bank of Baroda presently residing in district Ballia, with whom the informant/opposite party no. 3 had family relations, came to her home and proposed that he had taken franchise of Motilal Oswal Investment Services by the name of Rudranshi Finserve Pvt. Ltd. having its office at Ballia and that the opposite party no. 3 could open a mutual fund/SIP account for the purposes of trading and that her amount would be credited in her account through demat account, therefore, her account would remain safe and it would be the applicant no. 1's personal responsibility to ensure that the amount deposited by her was safe. At the time of this proposal, Raj Kumar Singh and Vijay Shankar Pandey were also there. Falling in the trap of the assurance given by the accused applicant no. 1, opposite party no. 3's husband gave a cheque of Rs. 55,000/- on 10.12.2015, other cheque of Rs. 1,95,000/- on 30.10.2015 and another cheque of Rs. 2,00,000/- in December, 2015 by opposite party no. 3 and in August, 2017 a cheque of Rs. 2,00,000/- of her daughter Priyanka Rai were given to accused applicant no. 1. After this, in SIP/mutual fund demat account no. 30 belonging to her husband, Rs. 50,000/- per month, and in account No. 48 in her own name a sum of Rs. 1,00,000/- per month and in account no. 67 of her son Gaurav Rai a sum of Rs. 60,000/- per month since 2016 and in account no. 82 of her daughter Priyanka Rai, a sum of Rs. 10,000/- per month since 2017, in all these accounts, a sum of Rs. 56,00,000/- were deposited in 28 installments and the accused applicant no. 1 kept giving guarantee for the safety of the said amount. Thereafter, a change was noticed in the behaviour of the accused applicant and then in June, 2018, they checked the statements of their accounts and found that they did not contain the amount which ought to have been there. Then they came to know about the deceit as instead of 62 lakhs, only Rs. 4,80,000/- were left in the said accounts, thus, by deceiving and cheating, the applicants had defrauded a sum of Rs. 56,00,000/-. Thereafter, the opposite party no. 3 tried to find out the cause of this forgery and she came to know that Rudranshi Finserve Pvt. Ltd. was not authorized company and had opened office illegally. Thereafter, they all had gone to Head Office of Motilal Oswal in Mumbai, and then they came to know that the amount of mutual fund which was being deposited in SIP, trading right of which was not given by them to accused applicant no. 1, both these accused in collusion with Motilal Oswal had made forged signatures of opposite party no. 3, her husband, and her son on consent letter and on their own had transacted a sum of Rs. 56,00,000/-, through their demat account and had therefore embezzled the said amount without the knowledge of the opposite party no. 3 and her family members. Thereafter, the informant had closed her account but by then within a span of two years, a sum of Rs. 57,20,000/- had already been embezzled. It is further mentioned that a sum of Rs. 56,00,000/- which was given by them for the purposes of trading, it was told that its information would be received by the informant, therefore, they did not pay any attention to the messages. When the opposite party no. 3 contacted the accused applicant no. 1, in this regard, he started abusing and tried to assault her and gave her threats to kill. Regarding this, the informant had given an information at P.S. Kotwali, District Balllia on 08.07.2018 but no action was taken, therefore, registered complaint was sent on 12.07.2018 to S.P. Ballia but even then no action was taken nor any report was lodged, therefore, she had to move an application under Section 156(3) Cr.P.C. Upon this complaint of opposite party no. 3, Crime No. 307 of 2018 was registered at P.S. Kotwali, District Ballia and investigation was made and thereafter, charge sheet has been submitted against the accused applicants and co-accused Motilal Oswal under above mentioned Sections after having recorded statements of as many as ten witnesses.
Submission of the learned counsel for the applicant is that after his retirement, the accused applicant no. 1 engaged himself as Business Associate of Motilal Oswal Securities Limited now Motilal Oswal Financial Services Ltd. hereinafter referred to as "MOFSL" which is a share trading/stock broking company, registered at S.E.B.I having registered office at Motilal Oswal Tower, Rahimtulla Sayani Road, opposite Parel St. Deopt. Prabha Devi Mumbai, Maharashtra. The said company provides services to open Demat account in the name of persons interested in trading and stock/share market and investment in Mutual Funds, etc. The work of the applicant as a business associate of the company is only to forward the applications duly filled in by interested person along with credentials such as PAN Card & Aadhar Card, etc. necessary for opening Demat account in the name of such persons. The photo copy of business associate agreement dated 01.07.2015 entered into between the applicant no. 1 and MOFSL and activated on 01.07.2015 as well as the photo copy of leaflet mentioning the basic services provided by the company which is annexed as annexure no. 1. It is next argued that the applicant no. 2 is daughter-in-law of the applicant no. 1 who resides with her family at Pune, Maharashtra where she also works as business associate of MOFSL and the name of her firm is Rudra Financial Services and Research having its registered office in Pune, Maharashtra. The photo copy of the business associate agreement dated 01.07.2015 entered into between the applicant no. 2 and MOFSL was activated on 23.07.2015 which is annexure no. 1A. Next it is submitted that the applicant no. 1 had official relation with husband of opposite party no. 3 Dr. Daddan Rai. The accounts mentioned in F.I.R. were opened at the instance of Dr. Daddan Rai i.e. DNSH-30 in December, 2013, DNSH 48 in January, 2016, DNSH 67 in March, 2016 and DNSH 82 in July, 2016. Next it is submitted that on scrutiny of KYC documents of DNSH 48 following observations were made; i). That Business Associate i.e. applicant has helped in account opening in official capacity of Business Associate; ii). That opposite party no. 3 has deposited her bank statement as annexure no. 6 with the Investigating Officer of the case. On scrutiny of the bank statement of opposite party no. 3, it is clear that she had made deposit with MOFSL which had been deposited in her demat account DNSH 48 by MOFSL and the same can be verified with demat account statement DNSH 48 annexed as annexure no. 5. The applicant has got prepared summary of the transactions of bank account and demat account of the family of the opposite party no. 3 annexed as annexure no. 8; iii). Opposite party no. 3 had opened with the help of MOFSL SIPs of Rs. 1,00,000/- in total which had been transferred from demat account to related SIPs accounts on monthly basis. It is evident from the profit and loss account of the opposite party no. 3 that she had ten SIPs of Rs. 10,000/- each which were transferred from demat account to SIPs accounts on monthly basis and that she had deposited for 28 months. The photo copy of the profit and loss account of DNSH-48 annexed as annexure no. 4; iv). On scrutinizing profit and loss account with demat account statement and bank statement, it is apparent that on the one side opposite party no. 3 was depositing installments of SIPs and on the other side she was taking fund transfer from demat account by breaking SIPs which has been credited to bank account from demat account resulting into loss of funds. In this way, opposite party no. 3 has suffered a loss of more than Rs. 18,00,000/-. The similar is the case of rest of accounts of the family members of the opposite party no. 3 which have been summarized in paragraph no. 9 of the affidavit and having summarized the same, it is submitted that it was clear that the allegation in F.I.R. that only 4.80 lacs were in her and her family members' accounts and rest of Rs. 56,00,000/- had been fraudulently withdrawn was baseless and false. The opposite party no. 3 and her entire family had deposited with MOFSL, a sum of Rs. 61.20 lacs in total and received in banks accounts Rs. 28,50,000/- and suffered a loss of Rs. 37,38,500/-. The photo copies of the demat account statement and bank statements related to this are annexed as annexure no. 5 and 6. Next it is argued that it is commonly known to every person investing in stock market that such investments are subject to market risks. The opposite party no. 3 has signed the risk documents while signing the KYC documents. So for allegation of fraudulently withdrawing her entire amount is totally baseless and false. The applicant is only a facilitator having no relation in operation of demat account etc. Next it is submitted that as regards allegation of forged document, no document other than KYC had been sent from the end of business associate Dashrath Nath Shukla (applicant no. 1). As soon as demat account was opened at MOFSL end, direct relation of MOFSL with his client started with the dispatch of Welcome Kit without any information to the facilitator/business associate. The welcome kit contains a booklet containing rules, regulations, account number, password, etc. for the client. The client starts direct dealings with MOFSL by depositing amount in his demat account by any bank mode. The alleged forged document was for the purpose of trading while opposite party no. 3 had given consent for trading to MOFSL which could be seen at page no. 5 of KYC document. MOFSL has also stated in letter dated 25.09.2018 sent to investigating officer, which is part of case diary also, that all the customers have opted to trade in all segments like cash, future and option, mutual funds and debt segment and had signed. The opposite party no. 3 and her family members had also given power of attorney to MOFSL by whom MOFSL was authorized to use the whole securities kept in demat account for trading. Thus, trading was done at MOFSL's end in right way and under authority. Photo copies of the alleged forged consent letters dated 09.05.2016 of opposite party no. 3 and Daddan Rai and letter dated 12.07.2016 of Gaurav Rai respectively, as well as specimen (original) signatures obtained on 20.09.2018 and the report dated 26.10.2018 of Forensic Science Laboratory, Ramnagar, Varanasi have been annexed collectively as annexure no. 7. It is further submitted that the responsibility of tallying signatures is that of MOFSL. The business associate/ facilitator/applicant no. 1 is neither responsible nor liable for signatures on any of the documents other than KYC documents, submitted at the time of account opening. The scrutiny of the said forged documents would show that there is no sign of office of the applicants or any signature of business associate. The said forged documents were verified at the MOFSL's end by the authorized persons namely, Sri Krishna Mishra and were received by Sri Rajan Kapoor and both of them were not working in their office presently as informed by the MOFSL to the investigating officer. Further it is submitted that opposite party no. 3 had not objected in any manner confirming the trading and trading rights at MOFSL's end. It is absolutely wrong to say by the opposite party no. 3 that she could not have seen the messages received as all the demat accounts of the family members have same mobile number and same e-mail Ids and was used by Dr. Daddan Rai in a daily routine life. Every stock exchange whether NSE or BSE sent messages to the clients in addition to messages sent by MOFLS, the details of every transaction are mailed by exchange with balance in demat account. In cases of SIPs, messages followed by mails are sent by mutual funds with balance of units at the time of credit of each installments with rates of units. A family of such educated person depositing and withdrawing huge money from the bank account would have no knowledge of messages is unbelievable and false. Further so far as the allegation regarding the office and working of Rurdranshi Finserve Pvt. Ltd. is concerned, it has nothing to do with MOFSL as the applicant is business associate of MOFSL in his individual and personal capacity and Rudranshi Finserve Pvt. Ltd. is not related in any manner, whether as a business associate or otherwise with MOFSL. The applicant no. 2 is the director of the said company. Her name is included in the F.I.R. so that she may be made accused because she is daughter-in-law of the applicant no. 1. The client understands and agrees that services availed by the stock brokers are of commercial nature and any dispute with respect to stock broker shall be subjected to Exchange Dispute Redressal Mechanism provided under the agreement and the consumer forum would have no jurisdiction to entertain the dispute. Accordingly, husband of the opposite party no. 3 on behalf of family members has filed complaint to Exchange Dispute Redressal Mechanism on 19.07.2018 and containing the same facts an F.I.R. has also been lodged by opposite party no. 3 on behalf of Dr. Daddan Rai, Shail Rai, Gaurav Rai and Priyanka Rai. It is further submitted that alleged consent letters and the signatures thereon are subject matter of verification of the trading house. The said letters authorized the trading house and no one else to use demat account for trading purposes or investment in SIP which could be used only after using specific password which remains in the knowledge of customers and the trading house only. It is further submitted that stock broker MOFSL / trading house is not made an accused in the present case despite the fact that all the transactions, signatures' verification, and other disputes are concerned with only MOFSL whereas applicants as business associates of MOFSL are merely facilitators in opening demat bank account who have been made main accused. In the present case, the complaint has been lodged after lapse of 26 months in violation of the guidelines provided of Dos and Don'ts annexed as annexure no. 17. If the account holders had any objection, he or she could have raised the same within seven days period before MOFSL which was not done in this case.
It is further submitted that the aggrieved by the fictitious and malafide allegations made in the F.I.R. registered as Case Crime No. 307 of 2018, under Sections 406, 419, 420, 467, 468, 471, 504 & 506 of I.P.C., a writ petition was preferred being Criminal Mics. Writ Petition No. 22283 of 2018 (Dashrath Nath Shukla v. State of U.P. and another), which was disposed of vide order dated 21.08.2018 directing that petitioner no. 2 (applicant no. 2) shall be not arrested till submission of police report under Section 173(2) Cr.P.C., however, the writ petition was dismissed with respect to petitioner no. 1. Aggrieved by the said order dated 21.08.2018, passed by the High Court, SLP (Criminal) No. 10840 of 2018 was preferred before Hon'ble Apex Court wherein interim order dated 14.01.2019 was passed directing that no coercive action shall be taken against the petitioner(applicant no. 1). After receiving the notice from Hon'ble Apex Court in the said SLP investigating officer expedited the investigation and submitted the charge sheet against the applicant which was found incomplete and hence, it was sent back to the investigating officer by the circle officer and direction was issued that the statements of the accused persons be recorded before the submission of the same. The investigating officer submitted the impugned charge sheet on 28.01.2019 against the applicant no. 2 Smt. Mamta Shukla and Sri Motilal Oswal, under above mentioned Sections without recording statement of applicant no.1 and applicant no. 2 Smt. Mamta Shukla. Thereafter, a statement was made before the Hon'ble Apex Court in the above mentioned SLP that after the conclusion of investigation, the charge sheet has been submitted before the court below and on the basis of statement made, the Hon'ble Apex Court was pleased to dispose of the said case vide order dated 11.03.2019 granting liberty to the applicant to challenge the charge sheet before the High Court in accordance with law and was further pleased to direct that interim order dated 14.01.2019 shall continue to be in operation for a period of next four months period from the date of order. It is further mentioned that surprisingly, the cognizance was taken by C.J.M., Ballia on the said charge sheet on 28.01.2019 vide order dated 20.02.2019 despite the fact that interim order dated 14.01.2019 passed by the Hon'ble Apex Court in above mentioned SLP was still in operation. Subsequently, on 01.03.2019, when it was brought to the notice of C.J.M., Ballia that interim order dated 14.01.2019 was existing, he passed order dated 01.03.2019 directing that no coercive action shall be taken against the applicants and other co-accused with an observation that accused applicant had not appeared and fixed next date. After the final disposal of the SLP (Criminal) No. 10840 of 2018 vide order dated 11.03.2019 by the Hon'ble Apex Court, the trial court has passed the impugned order dated 15.02.2020 summoning the applicant through NBW against settled principles of law by non application of judicial mind as there was no summons or bailable warrants served upon the applicant earlier. It was further submitted that the intention of opposite party no. 3 and his family members is evident from the copy of e-mail sent to son of the applicant by husband of opposite party no. 3. Further, it is reiterated that there is no evidence on record to prove that the alleged consent letters bear the signatures of the applicants or their office, in the capacity of business associate of MOFSL. The entire transaction has in fact taken place between the accounts of first informant and her family members with their demat accounts opened with MOFSL. Further it is submitted that two other criminal cases were also registered against the petitioner no. 1, details of which are mentioned in paragraph no. 49 of the affidavit and out of them in Case Crime No. 317 of 2018, the applicant is enjoying order of this Court passed in Criminal Misc. Writ Petition No. 5306 of 2019 vide order dated 26.02.2019 while in other Case Crime No. 793 of 2018, he has been allowed anticipatory bail by Bombay High Court, though, the case is still pending. Next it is submitted that the impugned order has been passed in a mechanical manner, in fact, no case of criminal breach of trust is made out. There are two distinct parts of the said offence. The first involves the fact of entrustment wherein obligation arises in relation to the property over which dominion or control is acquired. Second part deals with misappropriation which should be contrary to the terms of the obligation which is created. Thus, once it was proved that beneficial interest in the property was vested in some other person other than the accused and the accused has held that property on behalf of that person, appropriation of that beneficial interest in the property by the accused for his own use amounts to 'criminal breach of trust'. Next it is submitted that so far as offence under Section 420 of I.P.C. is concerned regarding which essential ingredients are (i) cheating; (ii) dishonest inducement to deliver property or to make, alter or destroy any valuable security or anything which is sealed or signed or is capable of being converted into a valuable security, and (iii) mens rea of the accused at the time of making the inducement but none of these ingredients are made out from the averments of this case.
Reliance has been placed upon V. P. Srivastava v. Indian Explosives Limited and others, (2010) 10 Supreme Court Cases 361, and V.Y. Josh and another vs. State of Gujarat and another, (2009) SCC 78 in which following is held: "Even if the allegations made in the complaint are taken to be correct on their face value, they may amount to breach of terms of contract by the Fertilizer Corporation of India Limited, but do not constitute an offence of 'Cheating' punishable under Section 420 IPC". Similarly, in para No. 38 of the judgment, it was concluded that "there is nothing in the complaint which may even suggest remotely that Indian Explosives Limited had entrusted any property to the appellants or tahht the appellants had dominion over any of the properties of the Indian Explosives which they dishonestly converted to their own use so as to satisfy the ingredients of Section 405 IPC, punishable under Section 406 IPC".
Further it is submitted that the facts in this case would show that the complainant had invoked the jurisdiction of Grieviance Cell of SEBI for adjudication of the dispute and that there was no inducement to deliver any property to the accused in this case and there is no material to indicate that the accused fraudulently and dishonestly induced the informant to deliver any property, therefore, as per settled law, there was no case of cheating made out against the applicants and it appears from the record that there was some breach of contract between the complainant and MOFSL but even then the MOFSL was not made party in this case.
He further placed reliance upon S. W. Palanitkar v. State of Bihar, 2002 (1) SCC 241, in which it was held that to constitute an offence of cheating the intention to deceive should be in existence at the time when inducement was made and it was necessary to show that a person had fraudulent and dishonest intention at the time of making the promise and that a mere failure to keep the promise subsequently cannot be presumed to be an act leading to cheating.
Further, reliance has been placed upon Smt. Phoolmati and others v. State of U.P. and another, (Manu/UP/0661/2016) which shows that forgery is sine-qua-non of offences under Section 467, 468 & 471 of I.P.C. Making of false document or false electric record or part thereof is condition precedent for offence of forgery. Perusal of Section 464 of I.P.C. (making of a false document) demonstrates that a person is said to have made false document if; (a) he executed a document claiming to be someone else or authorized by someone else; or (b) he altered and tampered a document; or (c) he obtained a document by practicing deception or from a person not in control of his faculties. In the light of above proposition of law, it is submitted that in the present case, the forged letters of consent were not prepared by the applicants, the same have been prepared just to implicate the applicants falsely with malafide intention by MOFSL or complainant just to get away from their liability. The applicants had never handled the accounts of the opposite party no. 3 as they were just facilitators. Further, it is submitted that record reveals that there was no allegation against accused applicants that they tried to deceive the complainant either by making a false or misleading representation. There was no allegation of fraudulent or dishonest inducement either; nor was there delivery of any property. In fact, the opposite party no. 3 was neither the aggrieved person for the purposes of Sections 419, 420, 467, 468 & 471 of I.P.C. nor victim within the meaning of Section 2(wa) of Cr.P.C. The complainant has been not defrauded in any manner. Further it is submitted that it is clear that the accused is not a beneficiary as per the statement of Demat account and that it is universal truth that there is always risk involved while trading in financial markets. The complainant/opposite party no. 3 has accused the accused applicants just to recover their losses incurred by them in market, though the applicants have no role in such transactions. It is further argued that the dispute between the parties is purely of civil nature, therefore, the remedy would be before the competent civil court. It was agreed between the parties that in case any dispute arises between them in connection with any of the transactions, the same shall be finally settled through Dispute Resolution Cell of the concerned Exchange and SEBI. The complainant had every knowledge of pros and cons and yet she willfully deposited the amount with MOFSL. As regards, applicant no. 2, she has been simply implicated being daughter-in-law of the applicant no. 1. Hence, the said proceedings need to be quashed.
From the side of opposite party no. 3 in rebuttal, submission is made by filing counter affidavit that the present application was filed by the applicants on 19.08.2020 which was registered on 03.09.2020 and the same had come up as fresh case before this Court on 29.09.2020 in Court No. 87 but the same was transferred to Court No. 66 but on the request of learned counsel for the applicants, the same was directed to be laid as fresh on 01.10.2020. Again on 01.10.2020, the case was put up as fresh in Court No. 87 but on the request of learned counsel for the applicants, the case was directed to be put up on 19.10.2020. Again on 19.10.2020, the case was put up as fresh in Court No. 87 but on the request of learned counsel for the applicant, the case was directed to be put up as fresh on 03.11.2020 and this shows that the applicants were indulging in bench hunting tactics.
It is further submitted that the correct facts are that both the applicants formed a gang of white collar criminals involved in economic offences and the applicant no. 1 is its kingpin. Applicant no. 1 had retired from Bank of Baroda from the post of Senior Manager having deep knowledge of financial matters by misusing his experience, he has indulged in commission of economic offences. So far as applicant no. 2 is concerned, she is applicant no. 1's real daughter-in-law. Sandeep Shukla (husband of applicant no. 2 and son of applicant no. 1) and applicant no. 1 are involved in several criminal cases of similar nature as they had cheated several innocent persons like the opposite party no. 3 and her husband. The entire family is history sheeter as they are inter-State criminals and lots of criminal cases are pending against them (narrated in paragraph no. 5 (d) of the affidavit). It is further submitted that the applicants are business associates of the company, Moti Lal Oswal Security Limited and are doing banking work at their registered office in district Ballia and have taken franchise of the said company by the name of Rudranshi Finserve Pvt. Ltd. The applicants were familiar with the opposite party no. 3 and her family members and on the request of the applicants, the opposite party no. 3 and his family members opened their accounts with the aid of the franchise of the applicants on the assurance of the applicants that their money which is deposited by them would be in their safe custody and on that assurance, the opposite party no. 3 and her husband, son and daughter had deposited in their respective accounts a sum of Rs. 56,00,000/- lacs in twenty eight instalments but subsequently by making forged and counterfeit signatures of the opposite party no. 3, her husband, son and daughter, on their respective separate forged consent letters, the accused persons had embezzled and misappropriated a sum of Rs. 57,20,000/- from their accounts. When the opposite party no. 3 and her family members had come to know about this, they informed in writing on 08.07.2018 at P.S. Kotwali, District Ballia but no action was taken, then on 12.07.2018, a complaint was sent on 08.07.2018 through registered post to S.P., Ballia, even then no action was taken, then having no option, she approached the competent court under Section 156(3) Cr.P.C. in which order dated 24.07.2018 was passed by the competent court by directing the SHO to register F.I.R. and investigate the case. Soon after lodging the F.I.R., the applicants had approached this Court, through filing Criminal Misc. Application No. 22283 of 2018 wherein arrest of the applicant no. 2 was stayed till submission of charge sheet but in respect of applicant no. 1 no relief was granted. Feeling aggrieved by the said dismissal order, the applicant no. 1 had approached the Hon'ble Apex Court by means of filing SLP (Criminal) No. 10840 of 2018 in which interim order dated 14.01.2019 was passed protecting the applicant no. 1 from any coercive measures being taken against him. On 11.03.2019, the said SLP was dismissed directing the applicant to approach the proper forum and for the period of four weeks, it was directed that no coercive steps shall be taken against him. The charge sheet dated 28.01.2019, was filed during pendency of the said SLP No. 10840 of 2018 but the said fact was not disclosed before Hon'ble Apex Court in order to take undue advantage. On the basis of said charge sheet, Criminal Case No. 210 of 2019 (State v. Dashrath Nath and others) had been registered in the Court of C.J.M., Ballia wherein the said court had taken cognizance and had summoned the applicants by a speaking order dated 20.02.2019. After passing of the final order by Hon'ble Apex Court dated 11.03.2019, a copy of the same was filed by the opposite party no. 3 before the trial court with an application containing prayer for issuing process against the applicants but no action was taken on the application, then the opposite party no. 3 had knocked at the door of the High Court by means of Criminal Application No. 41168 of 2019 (Smt. Shail Rai v. State of U.P.) which was disposed of vide order dated 19.11.2019 directing the trial court to decide/dispose of application of the informant and to initiate coercive process for appearance of the accused applicants and it was only thereafter that the trial court had issued the NBW on 15.02.2020. The applicants are avoiding appearance before the trial court and are absconding. After having absconded since the final order dated 11.03.2020, in above mentioned SLP, the applicant have now filed the present case before this Court with an intention to avoid the criminal proceedings which is nothing but an abuse of process of law. As regards commission of offence, the same is a question of facts to be decided by trial Court on the basis of evidence and the same cannot be decided by this Court in the proceedings under Section 482 Cr.P.C. particularly in view of the fact that report of Forensic Science Laboratory, Varanasi dated 26.10.2018 has come on record relating to falsity of the signature of opposite party no 3, her husband, son and daughter on forged consent letters in question, on the basis of which heavy amount of Rs. 56,00,000/- in question has been embezzled. At this stage, relying upon full bench decision of Hon'ble Apex Court reported in 2017 (9) SCC 641 (Parbatbhai Ahir and others v. State of Gujarat and others) and 1977 AIR 1489, 1977 SCR (3) 113 (State of Karnataka v. Muniswamy and others) holding therein that there is very limited scope before this Court to evaluate the evidence already collected by the I.O. in submitting the charge sheet and the present case does not fall within the ambit of limited scope, the present application is liable to be dismissed. It is further submitted that while dealing with the identical controversy/question of law, this Court in judgment dated 24.04.2020 passed in Application u/s 482 No. 5396 of 2006 (Umesh Chandra Saxena v. State of U.P. and another) discussed and determined the scope of judicialreview/enquiry/investigation under Section 482 Cr.P.C. and in view of the same, the present application is liable to be dismissed out-rightly. The star ground of challenging the proceeding by the applicants is contained in paragraph no. 63 of the affidavit particularly in sub paragraphs (I) & (IV) which says that the dispute between the parties is purely of civil nature which has deliberately being converted into criminal case with a view to pressurizing the applicants and the instant matter does not come under criminal act, the said argument is wholly misconceived. The applicants themselves have admitted in paragraph no. 61 of the affidavit that it is a case of forged letters of consent but the same is being denied to have been prepared by them and as per settled position of law, defence of the accused applicants against criminal charges cannot be considered by the High Court in Application u/s 482 Cr.P.C. as has been held by Hon'ble Apex Court in following cases: (i) Indian Oil Corporation v. NEPC, AIR 2006 SC 2780, (ii) State of Karnataka v. M. Devendrappa, 2015 (3) SCC 424 and (iii) Sau. Kamal Shivaji Pokarnekar v. State of Maharashtra, 2019 SCC Online 182. All these citations say that a criminal complaint cannot be quashed merely because the allegations made therein appear to be of civil nature in view of the the above position of law. Cognizance in a criminal case has to be taken on prima-facie satisfaction of the court and there is no bar in law to holding of both the civil and the criminal proceedings in the same matter. The full bench of Hon'ble Apex Court in M. S. Sheriff v. State of Madras reported in AIR 1954 SC 397 has held that where both criminal and civil proceedings are going on against a person in the same matter, criminal proceedings cannot be stayed. Further in Syed Askari Hadi Ali Augustine Imam v. State (Delhi Administrative), 2009 (5) SCC 528; P. Swaroopa Rani v. M. Hari Narayana @ Hari Babu, AIR 2008 SC 1884 and Delhi High Court in its judgment and order dated 01.12.2008 in CM(M) 532 of 2007 (Vipin Jain and others v. Yogesh Jain) have upheld the similar position of law and in view of the above position, it is prayed that this application needs to be rejected.
After having heard both the sides and having gone through the record, this Court finds that opposite party no. 3 and her entire family had opened four demat accounts DNSH30, DNSH40, DNSH64, DNSH82 with MOFSL on the basis of duly filled KYC documents which were forwarded by the business associate firm of the applicants and that several transactions were made from the said accounts by the MOFSL because power of attorney was executed by opposite party no. 3 in favour of MOFSL (annexed at page nos. 113 to 126 of the paper book), therefore, it is argued that on the basis of said power of attorney, the MOFSL was fully authorized to act on behalf of the opposite party no. 3 and her family members and in this process the opposite party no. 3 and her family members have incurred a huge loss to the tune of Rs. 57,20,000/- and that the balance sheet clearly shows that the said transactions were done by the opposite party no. 3 and her family members therefore, MOFSL who had been fully authorized through the power of attorney, hence, it cannot be said that it was the applicants who in any manner were involved in causing loss to the opposite party no. 3 and her family members. The applicants were only facilitators in respect of getting the demat account opened with the MOFSL and thereafter direct business was being conducted between the opposite party no. 3 and MOFSL. The applicants come nowhere in picture and they have been dragged in as accused because of having introduced the opposite party no. 3 and her family members to MOFSL through KYC forms and assistance rendered in opening of Demat accounts. For the business losses incurred by the opposite party no. 3, no criminal proceeding can be launched as it is a matter of civil nature and it is also brought to the notice during the arguments that already similar kind of complaint has been moved from the side of opposite party no. 3 before SEBI which is pending but simultaneously on the same ground with the same allegation, this criminal complaint has also been launched with malafide intention. As regards, applicant no. 2, it is argued that only because of she being daughter-in-law of the accused applicant no. 1, she has been implicated in the present case. Further it is argued that there is no entrustment of the property to the accused applicants from the side of opposite party no. 3 nor is there any embezzlement because nowhere has it come in evidence that any amount has been given to the accused applicants in any manner and therefore, it cannot be said that any misappropriation was done in this case of any amount belonging to opposite party no. 3 and her family members, therefore no case is made out against the accused applicants nor any appropriate evidence has been collected by the investigating officer against the accused applicants, therefore, charge sheet as well as cognizance order need to be quashed.
From the side of learned counsel for the opposite party no. 3, it was orally argued that the applicant no. 1 is the kingpin of the financial crime in the present case. Not only the opposite party no. 3 rather various other innocent people have been beguiled by them and misappropriation of their amount has been done by the firm of the accused applicant no. 1 who knows all the loopholes because he had retired from the post of bank manager. He has mainly drawn attention towards the consent letters annexed at page no. 282 to 305 which shows that a report was filed by the Forensic Science Laboratory on 26.10.2018 addressed to C.J.M., Ballia recording therein that the admitted signatures were tallied with the disputed signatures of opposite party no. 3 and her family members but they were not found tallying and on that basis it has been concluded by the investigating officer that the consent letters purportedly executed by opposite party no. 3 and her family members authorizing the MOFSL to transact on their behalf from the Demat account opened by them, such consent was never given by them as the same were found forged as it was found that they were not signatured by the opposite party no. 3 and her family members. The applicants are stated to be instrumental in execution of this document of consent and therefore, their role is being alleged in causing loss to the opposite party no. 3 to the tune of Rs. 57,20,000/- though the said role is being denied by the applicants on the ground that their role was only that of facilitators to the extent that they had introduced the opposite party no. 3 and her family members to MOFSL and not beyond that and thereafter once they had introduced the opposite party no. 3 and her family members to MOFSL thereafter they transacted with the MOFSL on their own directly, therefore, the applicants are being dragged in this case unnecessarily. This argument does not appear to be correct one because this is a disputed fact and opinion on this fact can come only after full trial as to whether there was any role of applicants in managing consent on behalf of opposite party no. 3 and her family members authorizing MOFSL to proceed with the trading on their behalf or not. At this stage, to opine that the applicants had no role does not appear to be correct. Rest of the facts, this Court would not like to enter into, as they all would fall in the category of disputed facts.
Now, this Court has to express opinion as to whether on the basis of evidence which has come on record, offence under Section 406 I.P.C. (criminal breach of trust), offence under Section 420 I.P.C. (cheating), offence under Section 467 I.P.C. (forging of valuable security, will etc.), offence under Section 468 I.P.C. (forgery for the purpose of cheating), offence under Section 471 I.P.C. (using as genuine forged document or electric record) and offence under Section 504 & 506 of I.P.C. are made out or not.
For the purpose of constituting the offence under Section 406 of I.P.C., essential ingredients are as follows:
(i) Entrusting any person with property or with any dominion over property;
(ii) The person enstrusted:
(a) dishonestly misappropriating or converting to his own use that property; 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, or
(ii) of any legal contract made touching the discharge of such trust.
In the light of the facts of the present case, it is apparent that it was on the basis of assurance given by the applicant to the opposite party no. 3 that Demat account was opened with MOFSL for the purposes of transaction that the said amount would be kept safe and the accused applicants who were business associate of the MOFSL had got the opposite party no. 3 and her family members introduced to the MOFSL. Pursuant to that the transactions were allowed to take place therefore, entrustment of property/money can be found to have been done in this case, prima-facie and since the allegation is that the said amount was misappropriated by the accused applicant's side, therefore, it cannot be denied that prima-facie there might be possibility of offence of criminal breach of trust having been committed by the accused applicants.
As regards, offence of cheating punishable under Section 420 of I.P.C., essential ingredients are as follows:
(i) There must be deception i.e. the accused must have deceived someone;
(ii) That by said deception, the accused must have induced a person,
(a) to deliver any property; or
(b) to make, alter or destroy the whole or part of the valuable security or any thing which is signed or sealed and which is capable of being converted into valuable property.
(iii) That the accused did so dishonestly.
If the evidence is analyzed on record, it may be found that there is allegation that the accused are stated to have deceived the opposite party no. 3 and her family members that in case they open the Demat account and transact through the same, there money would remain intact and the complainant side was introduced to the MOFSL by the applicants and later on it is found that the complainant side were cheated of a huge amount on the basis of transaction having been done after preparing forged consent letters purported to have been executed from the side of the complainant. Moreover, it is also apparent that due to the inducement made by the applicants, the opposite party no. 3 and her family members had opened the said Demat accounts and proceeded with the transaction. Therefore, it cannot be denied that the prima-facie offence of cheating appears to have also been made out.
As regards, offence under Section 467 of I.P.C., essential ingredients are as follows:
(i) That the accused committed forgery;
(ii) That such forgery was committed in relation to a document which purports to be, .......
(f) to receive or deliver any money, movable property or valuable security or any document purporting to be an acquitance or receipt acknowledging the payment of money.
In the case at hand, the consent letters purported to have been executed by the opposite party no. 3 and her family members are found to have been forged as they did not contain the signatures of opposite party no. 3 and her family members and this act is alleged to have been committed by the accused applicants with the aid of co-accused MOFSL which has resulted in causing huge loss to the opposite party no. 3 and her family members, therefore, it could be said that the offence under Section 467 of I.P.C., is also made out prima-facie.
As regards offence under Section 468 of I.P.C., essential ingredients are as follows:
(i) That the accused committed forgery;
(ii) That he did so intending that the document or electronic record forged shall be used for the purpose of cheating.
In the facts of the present case, these two ingredients are found to have been satisfied, hence offence under Section 468 I.P.C. is found to have been made out prima-facie.
As regards offence under Section 471 I.P.C., essential ingredients are as follows:
(i) Fraudulent or dishonest use of a document as genuine;
(ii) The person using it must have knowledge or reason to believe that the document is a forged one.
These two ingredients are found to have been satisfied in the facts of the present case which have been mentioned above, and therefore, this Court is of the view that whether these offence are made out or not, can only be seen by the court where the trial would be held after adducing evidence from both the side. At this stage, it is found that no interference is required to be made in impugned summoning order in proceedings under Section 482 Cr.P.C., therefore, the prayer for quashing the proceedings is refused.
This application u/s 482 Cr.P.C. is hereby, dismissed.
Order Date :- 22.2.2021 VPS