Sec.482 of Cr.P.C - quashing of criminal proceedings under sec.420 I.P.C - Business Transaction - issued cheques - cheques bounced - Complaint under NI act was dismissed as the cheque was not issued by Accused - complaint under sec.420 - police referred as a civil dispute - but court take Cognizance - Petition to Quash the same - High court refused to act - apex court confirmed the same -whether the allegations in the complaint discloses a criminal offence or not is the only to be considered but not the opinion of the police or the documents in the custody of accused which are useful for cross examination =
all the accused by mutual consent (conspiracy)
have played a fraud and cheated him by making false statement and holding
false assurances whereby they induced him to sign some papers. Allegedly,
the accused had full knowledge even before issuing the cheques that these
shall not be honoured and they had such dishonest intention from the
beginning.=
It is not in dispute that when the cheque bounced, the respondent
no.2 gave a legal notice and initiated a separate complaint under Section
138 of the Negotiable Instruments Act, 1881, besides lodging of the present
FIR on 28.4.1998.
The complaint filed against the appellants under the
Negotiable Instruments Act stands quashed by the High Court on the basis
that they had not issued the cheques in question.
Subsequently, the police concluded investigation and submitted final
report to the effect that the case is of civil nature.
The learned Chief
Judicial Magistrate, Sriganganagar, rejected the final report and after
hearing the parties took cognizance of the offence under Section 420 read
with Section 120-B of the IPC against all the five accused vide his order
dated 22.05.2000.
Quashing of criminal proceedings - High court refused to interfere and Apex court confirmed the same
2014 ( Feb.Part) judis.nic.in/supremecourt/filename=41215
P SATHASIVAM, RANJAN GOGOI, SHIVA KIRTI SINGH
REPORTABLE
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO. 1297 OF 2004
VIJAYANDER KUMAR & ORS. ... APPELLANTS
VS.
STATE OF RAJASTHAN & ANR. ... RESPONDENTS
J U D G M E N T
SHIVA KIRTI SINGH, J.
The appellants have preferred this appeal against the dismissal of
their petition under Section 482 of the Criminal Procedure Code (for
brevity `Cr.P.C.’) by the High Court of judicature for Rajasthan at
Jodhpur. The High Court declined to interfere with the order of learned
Chief Judicial Magistrate, Sriganganagar, dated 22.05.2000 in Case No.
63/2000, taking cognizance of offence under Section 420 read with Section
120-B of the Indian Penal Code.
2. Respondent No.2, Surendra Singhla, lodged a police case against the
appellants as well as one Satish Singhla on 28.04.1998. According to the
averments and allegations in the written report, the informant is a partner
of the Firm M/s. Rajshree Cotton Corporation, Sriganganagar, working as
broker as well as dealer in the sale and purchase of cotton. The
appellants are Directors of M/s. R.P. Taxfab Limited, Modi Nagar, who
purchased cotton through informant firm from time to time. As per the
accounts, the informant firm was to receive a sum of Rs.47,28,115.80/-.
The accused persons without taking the informant into confidence, entered
into an agreement for transfer of management, assets and liabilities of
M/s. R.P. Taxfab Limited in favour of accused Satish Singhla and two others
who became the new Directors.
The management of the Company was
transferred on 24.02.1998 and on 27.02.1998 the informant was called by the
appellants and told that the outstanding amount payable by the appellants
shall be paid by the new Directors. The informant did not agree to this.
On next date, the appellants through a demand draft for Rs.10,00,000/-
(rupees ten lacs) and returned cotton yarn worth Rs.13,26,560/- settled
the dues in part and for the remaining dues they persuaded the informant to
accept four post-dated cheques issued by the new Director Satish Singhla.
The informant accepted the cheques on being assured by the accused persons
that when presented on due dates the cheques shall be honoured. On such
persuasion and trust, the informant signed some typed papers showing that
he had agreed to receive the balance amount from the new Directors of the
Company and had received draft and goods from the appellants.
3. Besides the aforesaid allegations and averments in the written
information, the informant has also alleged that he would not have signed
the said papers nor received the post-dated cheques but for the assurances
given by the accused persons in presence of two witnesses. It is further
alleged that when the informant presented cheque dated 25.03.1998 for a sum
of Rs.5,00,000/- (rupees five lacs) through his bank, the said cheque was
dishonoured because accused Satish Singhla had got the payment of the
cheque stopped and that all the accused by mutual consent (conspiracy)
have played a fraud and cheated him by making false statement and holding
false assurances whereby they induced him to sign some papers. Allegedly,
the accused had full knowledge even before issuing the cheques that these
shall not be honoured and they had such dishonest intention from the
beginning.
4. It is not in dispute that when the cheque bounced, the respondent
no.2 gave a legal notice and initiated a separate complaint under Section
138 of the Negotiable Instruments Act, 1881, besides lodging of the present
FIR on 28.4.1998.
The complaint filed against the appellants under the
Negotiable Instruments Act stands quashed by the High Court on the basis
that they had not issued the cheques in question.
The appellants’ earlier
petition under Section 482 of the Cr.P.C. for quashing of FIR vide Criminal
Miscellaneous Petition No. 466 of 1998 was dismissed by the High Court by
order dated 12.02.1999 which is reported in 1999 Criminal law Journal 1849
(Vijayander Kumar and Ors. Vs. State of Rajasthan and Another).
A perusal
of that judgment discloses that the High Court considered in detail the
averments and allegations in the FIR and came to the conclusion that in
view of allegations and attending circumstances, at that stage it was not
possible to hold that the appellants cannot be liable for commission of any
offence. The High Court held that there was a case worth investigation.
5. Subsequently, the police concluded investigation and submitted final
report to the effect that the case is of civil nature. The learned Chief
Judicial Magistrate, Sriganganagar, rejected the final report and after
hearing the parties took cognizance of the offence under Section 420 read
with Section 120-B of the IPC against all the five accused vide his order
dated 22.05.2000.
6. The challenge to that order through a petition under Section 482 of
the Cr.P.C. has been rejected by the High Court by the order under Appeal.
7. Learned senior counsel for the appellants drew our attention to some
letters and communications such as annexure P.1 and P.2 both dated
27.02.1998 and annexure P.10 dated 24.02.1998 to support his contention
that on 24.02.1998 itself the change in the management was brought to the
notice of the informant with an intimation that a liability of
Rs.23,00,000/- (rupees twenty three lacs) has been transferred to the new
management which they shall pay and thereafter, on 27.02.1998 the informant
received payment from the appellants as well as accepted the post-dated
cheques on 27.02.1998 itself. On that basis it has been contended that
wrong averments and allegations have been made in the FIR. It is further
case of the appellants that the allegations and averments do not make out
any criminal offence.
8. On behalf of the appellants reliance has been placed upon judgments
of this Court in the case of Thermax Limited and Others Vs. K.M.Johny and
Others[1] and in case of Dalip Kaur and Others vs. Jagnar Singh and
another[2]. There can be no dispute with the legal proposition laid down
in the case of Anil Mahajan vs. Bhor Industries Limited[3] which has been
discussed in paragraph 31 in the case of Thermox Limited (supra) that if
the complaint discloses only a simple case of civil dispute between the
parties and there is an absolute absence of requisite averment to make out
a case of cheating, the criminal proceeding can be quashed. Similar is the
law noticed in the case of Dalip Kaur (supra).
In this case the matter was
remanded back to the High Court because of non-consideration of relevant
issues as noticed in paragraph 10, but the law was further clarified in
paragraph 11 by placing reliance upon judgment of this Court in R.Kalyani
vs. Janak C.Mehta[4]. It is relevant to extract paragraph 11 of the
judgment which runs as follows:
“11.There cannot furthermore be any doubt that the High
Court would exercise its inherent jurisdiction only when one or the
other propositions of law, as laid down in R. Kalyani v. Janak C.
Mehta is attracted, which are as under:
“(1) The High Court ordinarily would not exercise its
inherent jurisdiction to quash a criminal proceeding and, in
particular, a first information report unless the allegations
contained therein, even if given face value and taken to be
correct in their entirety, disclosed no cognizable offence.
(2) For the said purpose the Court, save and except in
very exceptional circumstances, would not look to any document
relied upon by the defence.
(3) Such a power should be exercised very sparingly. If
the allegations made in the FIR disclose commission of an
offence, the court shall not go beyond the same and pass an
order in favour of the accused to hold absence of any mens rea
or actus reus.
(4) If the allegation discloses a civil dispute, the same
by itself may not be ground to hold that the criminal
proceedings should not be allowed to continue.”
9. Learned senior counsel for the appellants also placed reliance upon
judgment of this Court in the case of Devendra and Others vs. State of
Uttar Pradesh and Another[5], only to highlight that a second petition
under Section 482 of the Cr.P.C. can be entertained because order of
Magistrate taking cognizance gives rise to a new cause of action. This
issue does not require any deliberation because learned senior counsel for
the respondent no.2, the informant, has not raised any objection to the
maintainability of petition under Section 482 of the Cr.P.C.
10. Contra the submission advanced on behalf of the appellants, learned
counsel for the respondent no.2 has submitted that there is no merit in the
contention advanced on behalf of the appellants that the FIR discloses only
a civil case or that there is no allegation or averment making out a
criminal offence.
For that purpose he relied upon judgment of the High
Court rendered in the facts of this very case reported in 1999 Criminal Law
Journal, 1849, already noted earlier.
11. No doubt, the views of the High Court in respect of averments and
allegations in the FIR were in the context of a prayer to quash the FIR
itself but in the facts of this case those findings and observations are
still relevant and they do not support the contentions on behalf of the
appellants.
At the present stage when the informant and witnesses have
supported the allegations made in the FIR, it would not be proper for this
Court to evaluate the merit of the allegations on the basis of documents
annexed with the memo of appeal. Such materials can be produced by the
appellants in their defence in accordance with law for due consideration at
appropriate stage.
12. Learned counsel for the respondents is correct in contending that a
given set of facts may make out a civil wrong as also a criminal offence
and only because a civil remedy may also be available to the
informant/complainant that itself cannot be a ground to quash a criminal
proceeding.
The real test is whether the allegations in the complaint
discloses a criminal offence or not. This proposition is supported by
several judgments of this Court as noted in paragraph 16 of judgment in the
case of Ravindra Kumar Madhanlal Goenka and Another vs. Rugmini Ram Raghav
Spinners Private Limited[6]
13. On considering the facts of the present case it is found that the
facts were properly noticed by the High Court on earlier occasion while
examining the petition preferred by the appellants for quashing of FIR of
this case. The same view has been reiterated by the High Court in the
order under appeal for not interfering with the order of cognizance by the
learned Magistrate. Hence, we do not find any good ground to interfere
with the criminal proceedings against the appellants at this stage. The
appeal is, therefore, dismissed. No costs.
14. It is, however, made clear that observations in this order or in the
order under appeal are only for deciding the issues raised at the present
stage and shall not affect the defence of the appellants at a subsequent
stage of the proceeding.
……………………………………………C.J.I.
(P. SATHASIVAM)
……………………………………………………J.
(RANJAN GOGOI)
……………………………………………………J.
(SHIVA KIRTI SINGH)
New Delhi;
February 11, 2014.
-----------------------
[1] (2011) 13 SCC 412
[2] (2009) 14 SCC 696
[3] (2005) 10 SCC 228
[4] (2009) 1 SCC 516
[5] (2009) 7 SCC 495
[6] (2009) 11 SCC 529
-----------------------
13
all the accused by mutual consent (conspiracy)
have played a fraud and cheated him by making false statement and holding
false assurances whereby they induced him to sign some papers. Allegedly,
the accused had full knowledge even before issuing the cheques that these
shall not be honoured and they had such dishonest intention from the
beginning.=
It is not in dispute that when the cheque bounced, the respondent
no.2 gave a legal notice and initiated a separate complaint under Section
138 of the Negotiable Instruments Act, 1881, besides lodging of the present
FIR on 28.4.1998.
The complaint filed against the appellants under the
Negotiable Instruments Act stands quashed by the High Court on the basis
that they had not issued the cheques in question.
Subsequently, the police concluded investigation and submitted final
report to the effect that the case is of civil nature.
The learned Chief
Judicial Magistrate, Sriganganagar, rejected the final report and after
hearing the parties took cognizance of the offence under Section 420 read
with Section 120-B of the IPC against all the five accused vide his order
dated 22.05.2000.
Quashing of criminal proceedings - High court refused to interfere and Apex court confirmed the same
2014 ( Feb.Part) judis.nic.in/supremecourt/filename=41215
P SATHASIVAM, RANJAN GOGOI, SHIVA KIRTI SINGH
REPORTABLE
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO. 1297 OF 2004
VIJAYANDER KUMAR & ORS. ... APPELLANTS
VS.
STATE OF RAJASTHAN & ANR. ... RESPONDENTS
J U D G M E N T
SHIVA KIRTI SINGH, J.
The appellants have preferred this appeal against the dismissal of
their petition under Section 482 of the Criminal Procedure Code (for
brevity `Cr.P.C.’) by the High Court of judicature for Rajasthan at
Jodhpur. The High Court declined to interfere with the order of learned
Chief Judicial Magistrate, Sriganganagar, dated 22.05.2000 in Case No.
63/2000, taking cognizance of offence under Section 420 read with Section
120-B of the Indian Penal Code.
2. Respondent No.2, Surendra Singhla, lodged a police case against the
appellants as well as one Satish Singhla on 28.04.1998. According to the
averments and allegations in the written report, the informant is a partner
of the Firm M/s. Rajshree Cotton Corporation, Sriganganagar, working as
broker as well as dealer in the sale and purchase of cotton. The
appellants are Directors of M/s. R.P. Taxfab Limited, Modi Nagar, who
purchased cotton through informant firm from time to time. As per the
accounts, the informant firm was to receive a sum of Rs.47,28,115.80/-.
The accused persons without taking the informant into confidence, entered
into an agreement for transfer of management, assets and liabilities of
M/s. R.P. Taxfab Limited in favour of accused Satish Singhla and two others
who became the new Directors.
The management of the Company was
transferred on 24.02.1998 and on 27.02.1998 the informant was called by the
appellants and told that the outstanding amount payable by the appellants
shall be paid by the new Directors. The informant did not agree to this.
On next date, the appellants through a demand draft for Rs.10,00,000/-
(rupees ten lacs) and returned cotton yarn worth Rs.13,26,560/- settled
the dues in part and for the remaining dues they persuaded the informant to
accept four post-dated cheques issued by the new Director Satish Singhla.
The informant accepted the cheques on being assured by the accused persons
that when presented on due dates the cheques shall be honoured. On such
persuasion and trust, the informant signed some typed papers showing that
he had agreed to receive the balance amount from the new Directors of the
Company and had received draft and goods from the appellants.
3. Besides the aforesaid allegations and averments in the written
information, the informant has also alleged that he would not have signed
the said papers nor received the post-dated cheques but for the assurances
given by the accused persons in presence of two witnesses. It is further
alleged that when the informant presented cheque dated 25.03.1998 for a sum
of Rs.5,00,000/- (rupees five lacs) through his bank, the said cheque was
dishonoured because accused Satish Singhla had got the payment of the
cheque stopped and that all the accused by mutual consent (conspiracy)
have played a fraud and cheated him by making false statement and holding
false assurances whereby they induced him to sign some papers. Allegedly,
the accused had full knowledge even before issuing the cheques that these
shall not be honoured and they had such dishonest intention from the
beginning.
4. It is not in dispute that when the cheque bounced, the respondent
no.2 gave a legal notice and initiated a separate complaint under Section
138 of the Negotiable Instruments Act, 1881, besides lodging of the present
FIR on 28.4.1998.
The complaint filed against the appellants under the
Negotiable Instruments Act stands quashed by the High Court on the basis
that they had not issued the cheques in question.
The appellants’ earlier
petition under Section 482 of the Cr.P.C. for quashing of FIR vide Criminal
Miscellaneous Petition No. 466 of 1998 was dismissed by the High Court by
order dated 12.02.1999 which is reported in 1999 Criminal law Journal 1849
(Vijayander Kumar and Ors. Vs. State of Rajasthan and Another).
A perusal
of that judgment discloses that the High Court considered in detail the
averments and allegations in the FIR and came to the conclusion that in
view of allegations and attending circumstances, at that stage it was not
possible to hold that the appellants cannot be liable for commission of any
offence. The High Court held that there was a case worth investigation.
5. Subsequently, the police concluded investigation and submitted final
report to the effect that the case is of civil nature. The learned Chief
Judicial Magistrate, Sriganganagar, rejected the final report and after
hearing the parties took cognizance of the offence under Section 420 read
with Section 120-B of the IPC against all the five accused vide his order
dated 22.05.2000.
6. The challenge to that order through a petition under Section 482 of
the Cr.P.C. has been rejected by the High Court by the order under Appeal.
7. Learned senior counsel for the appellants drew our attention to some
letters and communications such as annexure P.1 and P.2 both dated
27.02.1998 and annexure P.10 dated 24.02.1998 to support his contention
that on 24.02.1998 itself the change in the management was brought to the
notice of the informant with an intimation that a liability of
Rs.23,00,000/- (rupees twenty three lacs) has been transferred to the new
management which they shall pay and thereafter, on 27.02.1998 the informant
received payment from the appellants as well as accepted the post-dated
cheques on 27.02.1998 itself. On that basis it has been contended that
wrong averments and allegations have been made in the FIR. It is further
case of the appellants that the allegations and averments do not make out
any criminal offence.
8. On behalf of the appellants reliance has been placed upon judgments
of this Court in the case of Thermax Limited and Others Vs. K.M.Johny and
Others[1] and in case of Dalip Kaur and Others vs. Jagnar Singh and
another[2]. There can be no dispute with the legal proposition laid down
in the case of Anil Mahajan vs. Bhor Industries Limited[3] which has been
discussed in paragraph 31 in the case of Thermox Limited (supra) that if
the complaint discloses only a simple case of civil dispute between the
parties and there is an absolute absence of requisite averment to make out
a case of cheating, the criminal proceeding can be quashed. Similar is the
law noticed in the case of Dalip Kaur (supra).
In this case the matter was
remanded back to the High Court because of non-consideration of relevant
issues as noticed in paragraph 10, but the law was further clarified in
paragraph 11 by placing reliance upon judgment of this Court in R.Kalyani
vs. Janak C.Mehta[4]. It is relevant to extract paragraph 11 of the
judgment which runs as follows:
“11.There cannot furthermore be any doubt that the High
Court would exercise its inherent jurisdiction only when one or the
other propositions of law, as laid down in R. Kalyani v. Janak C.
Mehta is attracted, which are as under:
“(1) The High Court ordinarily would not exercise its
inherent jurisdiction to quash a criminal proceeding and, in
particular, a first information report unless the allegations
contained therein, even if given face value and taken to be
correct in their entirety, disclosed no cognizable offence.
(2) For the said purpose the Court, save and except in
very exceptional circumstances, would not look to any document
relied upon by the defence.
(3) Such a power should be exercised very sparingly. If
the allegations made in the FIR disclose commission of an
offence, the court shall not go beyond the same and pass an
order in favour of the accused to hold absence of any mens rea
or actus reus.
(4) If the allegation discloses a civil dispute, the same
by itself may not be ground to hold that the criminal
proceedings should not be allowed to continue.”
9. Learned senior counsel for the appellants also placed reliance upon
judgment of this Court in the case of Devendra and Others vs. State of
Uttar Pradesh and Another[5], only to highlight that a second petition
under Section 482 of the Cr.P.C. can be entertained because order of
Magistrate taking cognizance gives rise to a new cause of action. This
issue does not require any deliberation because learned senior counsel for
the respondent no.2, the informant, has not raised any objection to the
maintainability of petition under Section 482 of the Cr.P.C.
10. Contra the submission advanced on behalf of the appellants, learned
counsel for the respondent no.2 has submitted that there is no merit in the
contention advanced on behalf of the appellants that the FIR discloses only
a civil case or that there is no allegation or averment making out a
criminal offence.
For that purpose he relied upon judgment of the High
Court rendered in the facts of this very case reported in 1999 Criminal Law
Journal, 1849, already noted earlier.
11. No doubt, the views of the High Court in respect of averments and
allegations in the FIR were in the context of a prayer to quash the FIR
itself but in the facts of this case those findings and observations are
still relevant and they do not support the contentions on behalf of the
appellants.
At the present stage when the informant and witnesses have
supported the allegations made in the FIR, it would not be proper for this
Court to evaluate the merit of the allegations on the basis of documents
annexed with the memo of appeal. Such materials can be produced by the
appellants in their defence in accordance with law for due consideration at
appropriate stage.
12. Learned counsel for the respondents is correct in contending that a
given set of facts may make out a civil wrong as also a criminal offence
and only because a civil remedy may also be available to the
informant/complainant that itself cannot be a ground to quash a criminal
proceeding.
The real test is whether the allegations in the complaint
discloses a criminal offence or not. This proposition is supported by
several judgments of this Court as noted in paragraph 16 of judgment in the
case of Ravindra Kumar Madhanlal Goenka and Another vs. Rugmini Ram Raghav
Spinners Private Limited[6]
13. On considering the facts of the present case it is found that the
facts were properly noticed by the High Court on earlier occasion while
examining the petition preferred by the appellants for quashing of FIR of
this case. The same view has been reiterated by the High Court in the
order under appeal for not interfering with the order of cognizance by the
learned Magistrate. Hence, we do not find any good ground to interfere
with the criminal proceedings against the appellants at this stage. The
appeal is, therefore, dismissed. No costs.
14. It is, however, made clear that observations in this order or in the
order under appeal are only for deciding the issues raised at the present
stage and shall not affect the defence of the appellants at a subsequent
stage of the proceeding.
……………………………………………C.J.I.
(P. SATHASIVAM)
……………………………………………………J.
(RANJAN GOGOI)
……………………………………………………J.
(SHIVA KIRTI SINGH)
New Delhi;
February 11, 2014.
-----------------------
[1] (2011) 13 SCC 412
[2] (2009) 14 SCC 696
[3] (2005) 10 SCC 228
[4] (2009) 1 SCC 516
[5] (2009) 7 SCC 495
[6] (2009) 11 SCC 529
-----------------------
13
