The High Court
Case Details
1 Cr.M.P. No.2442 of 2021 IN THE HIGH COURT OF JHARKHAND AT RANCHI Cr.M.P. No. 2442 of 2021 1. Bhartiya Rail Bijlee Company Ltd. officiating his work from Nabi Nagar Thermal Power Project, H type Office, P.S.-Khaira, P.O. Nabi Nagar, Dist.-Aurangabad, State-Bihar represented by C. Shiv Kumar, Chief Executive Officer, (C.E.O.), Bhartiya Rail Bijlee Company Ltd. 2. Shiv Kumar, aged about 57 years, s/o Sh Rama Murthy, Chilakapati r/o D-84 Shaurya NTPC Township Sector 33 Noida (U.P.), P.S. Sector 33, P.O. Ghaziabad, presently working as Chief Executive Officer (C.E.O.) Bhartiya Rail Bijlee Company Ltd. officiating his work from Nabi Nagar Thermal Power Project, H type Office, P.S.- Khaira, P.O. Nabi Nagar, Dist.-Aurangabad, State-Bihar 3. S.K. Jain, aged about 56 years, s/o late Subhash Chandra Jain r/o Room No.1 FH 1 BRBCK Township Nabi Nagar, Aurangabad, Bihar, P.O. - Nabi Nagar, P.S.-Khaira, Dist.-Purnia, presently working as Senior Manager (C&M) Bhartiya Rail Bijlee Company Ltd. officiating his work from Nabi Nagar Thermal Power Project, H type Office, P.S.-Khaira, P.O. Nabi Nagar, Dist.-Aurangabad, State-Bihar .... Petitioners Versus 1. The State of Jharkhand 2. Kamal Kumar Sanghvi, proprietor of M/s SAN Associates, S/o late J.C. Sanghvi, r/o Gujarat Bhawan, Gujarat Colony, Chas, P.O. & P.S.- Chas, Dist.-Bokaro, Jharkhand …. Opp. Parties P R E S E N T
Legal Reasoning
It is well settled 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 the present case it has 7 Cr.M.P. No.2442 of 2021 nowhere been stated that at the very inception there was any intention on behalf of the accused persons to cheat which is a condition precedent for an offence under Section 420 IPC.” (Emphasis supplied) 14. Apart from absence of any allegation of having any intention to deceive the complainant at any point of time, there is no allegation against the petitioner of inducing the complainant to deliver any property to anybody or person. 15. Under such circumstances, this Court is of the considered view that even if the entire allegations made in the complaint, statement of the complainant under solemn affirmation and the statement of inquiry witnesses are treated to be true in its entirety, still the offence punishable under Section 420 of Indian Penal Code is not made out and in the absence of any allegation of criminal conspiracy of the petitioners, the offence punishable under Section 120B of Indian Penal Code is also not made out. 16. Because of the discussions made above, this Court has no hesitation in holding that continuation of this criminal proceeding against the petitioner will amount to abuse of process of law and this is a fit case where the order taking cognizance dated 26.03.2021 passed by the learned Judicial Magistrate 1st Class, Bokaro in connection with C.P. Case No. 558 of 2020 be quashed and set aside. 17. Accordingly, the order taking dated 26.03.2021 passed by the learned Judicial Magistrate 1st Class, Bokaro in connection with C.P. Case No. 558 of 2020 is quashed and set aside. 18.
Arguments
HON’BLE MR. JUSTICE ANIL KUMAR CHOUDHARY ….. For the Petitioners For the State : Mr. Prashant Pallav, Advocate : Ms. Shivani Jaluka, Advocate : Mr. V.K. Vashistha, Spl. P.P. 2 ….. Cr.M.P. No.2442 of 2021 By the Court:- 1. 2. 3. Heard the parties. Though notice has been validly served upon the opposite party no.2 yet no one turns up on behalf of the opposite party no.2 in-spite of repeated calls. This criminal miscellaneous petition has been filed invoking the jurisdiction of this Court under Section 482 Cr.P.C. to quash the order taking dated 26.03.2021 passed by the learned Judicial Magistrate 1st Class, Bokaro in connection with C.P. Case No. 558 of 2020 by which cognizance has been taken by the learned Judicial Magistrate 1st Class, Bokaro for the offence punishable under Sections 420 and 120B of Indian Penal Code. 4. The allegation against the petitioners is that the petitioner no.1 is a subsidiary company National Thermal Power Corporation and the petitioner nos.2 and 3 are its Chief Executive Officer and Senior Manager (C&M) respectively. The allegation against the petitioners is that the petitioners floated a tender for manufacturing of M.S. barge to be used for makeup water system and the complainant participated in the bid process on behalf of M/s Cleghorn Company Pvt. Ltd. and was declared successful. The complainant deposited a sum of Rs.2,75,000/- as earnest money vide demand draft. The petitioners via mail intimated the complainant that the quotation of the complainant is under consideration and there is a need of certain documents that needs to be submitted by the complainant. The petitioners issued letter of intent on 27.09.2018 to the complainant of course; the same is not a purchase order. The complainant intimated 3 Cr.M.P. No.2442 of 2021 the petitioners that without issuance of purchase order the complainant has started the work and procured the raw materials from the company and the complainant remitted Rs.10,00,000/- in the account of Cleghorn Company Pvt. Ltd. but later on the petitioners intimated the complainant vide letter dated 20.10.2018 and 24.10.2018 that all activity concerning the tender bid shall be put on hold and the complainant shall wait for official purchase order. The complainant demanded refund of EMD which was done and thereafter the complainant lodged the complaint. 5. It is submitted by the learned counsel for the petitioner that there is an inordinate delay in lodging the complaint and letter of intent cannot be equated as purchase order and letter of intent is not a binding contract between the parties as it does not lay down any condition. It is next submitted by the learned counsel for the petitioner that this complaint gives a cloak of criminal dispute to a purely civil dispute and there is no allegation against the petitioner of making the complainant to deliver any property to any person hence, the offence punishable under Section 420 of Indian Penal Code is not made out. 6. Relying upon the judgment of Hon’ble Supreme Court of India in the case of R. Nagender Yadav vs. The State of Telangana & Ors. reported in 2022 LiveLaw (SC) 1030, paragraph no.17 of which reads as under:- “17. While exercising its jurisdiction under Section 482 of the CrPC, the High Court has to be conscious that this power is to be exercised sparingly and only for the purpose of prevention of abuse of the process of the court or otherwise to secure the ends of justice. Whether a complaint discloses a criminal offence or not, depends upon the nature of the act alleged thereunder. Whether the essential ingredients of a criminal offence are present or not, has to be judged by the High Court. A complaint disclosing civil transaction may also have a criminal texture. 4 Cr.M.P. No.2442 of 2021 But the High Court must see whether the dispute which is in substance of a civil nature is given a cloak of a criminal offence. In such a situation, if civil remedy is available and is in fact adopted, as has happened in the case on hand, the High Court should have quashed the criminal proceeding to prevent abuse of process of court.” 7. It is submitted by the learned counsel for the petitioners that while exercising the power under Section 482 Cr.P.C. in respect of the prayer for quashing the criminal proceeding, the High Court must see that if a civil remedy is available and in fact adopted, the High Court should quash the criminal proceeding. 8. Relying upon the judgment of High Court of Jammu & Kashmir and Ladakh at Srinagar passed in the case of Ghulam Qadir Bhat & Anr. vs. U.T. of J&K & Ors. in W.P. (C) No. 2108 of 2022 and C.M. No. 5317 of 2022, paragraph no.15 of which reads as under:- “15. The invitation to offer merely invites the other party to make negotiations and makes an order. This offer was yet to be accepted by the respondents for a contract to come into existence which could be enforceable for the parties. It is a well settled position of law that merely by participating in the tender, no right is created in favour of the bidder and the tenderer cannot be precluded from its option to cancel the tendering process on any grounds. The tendering process, thus, can be cancelled at any stage before finalization and issuance of letter of acceptance as there was no concluded contract between the parties. Thus, the legitimate expectations on the petitioners having altered their positions on the basis of being declared L-1 has no significance as there was no contract between the parties.” (Emphasis supplied) It is submitted by the learned counsel for the petitioner that a tendering process thus can be cancelled at any stage before finalization and issuance of letter of acceptance as there was no concluded contract between the parties and as admittedly, no purchase order has been issued nor any property has been entrusted to any of the petitioners nor there is any allegation against the petitioners of deceiving the opposite party no.2 and thereby 5 Cr.M.P. No.2442 of 2021 inducing him to deliver any property to any person or to consent that such persons shall retain any property or intentionally induce that person so deceived to do or omit to do anything which he would not do or omit if he were not so deceived, the offence punishable under Section 420 of Indian Penal Code is not made out. 9. Hence, it is submitted that the order taking cognizance dated 26.03.2021 passed by the learned Judicial Magistrate 1st Class, Bokaro in connection with C.P. Case No. 558 of 2020 be quashed and set aside. 10. Learned Special Public Prosecutor on the other hand opposes the prayer for quashing the order taking cognizance dated 26.03.2021 passed by the learned Judicial Magistrate 1st Class, Bokaro in connection with C.P. Case No. 558 of 2020 and submits that the allegations made in the complaint, statement of the complainant under solemn affirmation and the statement of the inquiry witnesses is sufficient to constitute the offence punishable under Sections 420 and 120B of Indian Penal Code. Hence, it is submitted that this criminal miscellaneous petition being without any merit be dismissed. 11. Having heard the submissions made at the Bar and after going through the materials in the record, it is pertinent to mention here that the essential ingredients to constitute the offence punishable under Section 420 of Indian Penal Code are (1) there is a fraudulent or dishonest inducement of a person by deceiving him, (2) (a) the person so induced should be intentionally induced to deliver any property to any person or to consent that any person shall retain any property, or 6 Cr.M.P. No.2442 of 2021 (b) the person so induced to do anything which he would not do or omit if he were not so deceived, and (c) in case covered by second part of clause (a), the act or omission should be one which caused or was likely to cause damage or harm to the person induced in body, mind or property as has been held by the Hon’ble Supreme Court of India in the case of R.S. Nayak vs. A.R. Antulay reported in (1986) 2 SCC 716. 12. In other words, the two essential ingredients of the offence under Section 420 of Indian Penal Code are that (A) Deceit, is misrepresentation, and (B) Inducing the person deceived to part with property to say dishonest or fraudulent as has been held by the Hon’ble Supreme Court of India in the case of Mubarak Ali vs. State reported in AIR 1957 SC 857 as well as in the case of Ram Narayan vs. CBI reported in (2003) 3 SCC 641. 13. Now coming to the facts of the case, the only allegation against the petitioners is that the petitioners have floated a tender and issued a letter of intent but did not issue any purchase order. There is no allegation of deception against them. It is a settled principle of law that in order to constitute the offence of cheating, the accused persons must have the intention of cheating the victim since the very inception as has been held by the Hon’ble Supreme Court of India in the case of Uma Shankar Gopalika vs. State of Bihar & Anr. reported in (2005) 10 SCC 336, paragraph no. 6 of which reads as under :- 6. Xxxx xxxx xxxx
Decision
In the result, this criminal miscellaneous petition is allowed. (Anil Kumar Choudhary, J.) High Court of Jharkhand, Ranchi Dated the 18th March, 2024 AFR/Sonu-Gunjan/-