M/s Sierra Trading Pvt. Ltd. v. The State of Bihar

24.3.2006 passed by Shri Ashutosh Kumar, Judicial Magistrate, Ist Class, Muzaffarpur in Complaint Case No.2928 of 2005, which is Trial No.1812 of 2006. Cognizance has been taken under Section 403, 406, 411 and 420 of the Indian Penal Code. A Complaint Case No.2928 of 2005 was lodged in the Court of Chief Judicial Magistrate, Muzaffarpur on 7.12.2005 by complainant alleging therein that the petitioner is a company which deals in miscellaneous leather items and engages in manufacture of leather items after procuring raw skins from across the country. The company is supposed to be located at Chennai. In the year 2002 the petitioner approached the complainant through an accused namely, Shamshad Ahmad at Muzaffarpur and made a request for supply of raw leather to him by organizing and coordinating - 2 - even with other local dealers of Muzaffarpur to meet the demand. Assurances of quick payment at agreed rates were made and based on an oral agreement itself many assignments came to be forwarded by the complainant and payments were made, off and on. Between

30.10.2002 to 31.3.2003 complainant made supplies of raw skin worth 33,57,199/- against which only a sum of Rs.27,96,354/- was paid, the balance of about 5.5 lacs remained. Some more payments and supplies have been mentioned in the complaint but finally it seems, for the supplies made for the period 15.7.2003 to 22.1.2004 a total sum of Rs.6,00,992/- remained due which despite various demands and claim was refused to be paid by the petitioner in connivance with accused no.2. The complainant further made enquiries and came to know that the petitioner company in connivance with accused no.2 the habit of cheating and misappropriating goods supplied to them by various suppliers. When all efforts including personal visit of the complainant failed to beget his payments he decided to file the present complaint of which cognizance has been taken, which has been noticed in the earlier part of the order. The petitioner now wants quashing of the same. Learned counsel representing the petitioner submits that it is a false and malicious prosecution initiated by the complainant which primarily relates to the accounting and payments which at the most is a civil dispute for which the criminal Court ought not to be used as a forum to settle the dispute between two contracting parties. It is also urged that payments had been made, if there are some discrepancies in the - 3 - accounting, there was never a dishonest intention on the part of the petitioner to meet its obligation. Some details of the payments have also been indicated. Notices were issued to the complainant by the Court. Complainant had appeared through a counsel and filed his counter affidavit. Complainant has stated the details and the background under which the present case came to be filed. He states that the accused no.2, who is the promoter of the petitioner company is/was a resident of Muzaffarpur, who was indulging in similar kind of business but when he ran into insurmountable debt, he shifted his business to Bangalore leaving his past liability. Even after shifting to Bangalore, by similar kind of modus operandi and other dishonest conduct he has defalcated public money and a proceeding had been initiated by the Canara Bank in the Debts Recovery Tribunal at Bangalore. The petitioner has a habit of not entering into any kind of written contracts with the suppliers. Making prompt payments initially on an oral understanding and thereafter going back on the commitment. It is also urged that some of the bank drafts which have been brought on record by way of a supplementary affidavit are only a ploy to divert the attention of the Court from the wrongdoing of the petitioner. These drafts have been prepared on fake and anonymous names and there is no evidence that they ever came to be paid. According to the complainant large number of those names is not of the so-called suppliers who had also supplied leather to the company through complainant and that by itself establish the dishonest intent of the - 4 - petitioner in this regard. Considering the entirety of the allegations and statements made both in the quashing application as well as the complaint petition the Court has difficulty in accepting the submission made on behalf of the petitioner that it is out and out a civil dispute. If there was any written concluded contract the authenticity of the whole transaction would have been supported or accepted but since large amount of supplies have been made and the obligation for payments have been met only in part and then an effort has been made to bring on record certain evidence by way of bank drafts, authenticity of which is seriously disputed by the complainant then the Court cannot come to the rescue of the petitioner straight away. The matter came to be adjourned on quite a few occasions and at times submissions were made at Bar on behalf of the petitioner that he was genuinely interested in resolving the dispute and settling the claim but except for a few letter writing no serious effort has ever been made and it is contended on behalf of the opposite party that it is only strategy to delay the trial as well as the case pending in the Court below. In absence of any categorical affidavit or stand of the petitioner of the bonafide of his statement made at the Bar with regard to the settling of the dispute between the parties and with a categorical stand taken by the opposite party with regard to the so-called misleading evidence which are the bank draft which have been brought on record, the Court has certain reservations in quashing the proceeding initiated against - 5 - the petitioner and, therefore, the prayer stands rejected but liberty is granted to the petitioner that he may appear before the Court below and raise all such questions of law which may be available including the defence at the time of framing of charge against him. This application is dismissed. Pawan/- (Ajay Kumar Tripathi, J.)