High Court
Case Details
Neutral Citation No. - 2024:AHC:119680 Court No. - 74 Case :- APPLICATION U/S 482 No. - 9548 of 2024 Applicant :- Smt Shakuntala Devi And Others Opposite Party :- State of U.P. and Another Counsel for Applicant :- Narendra Kumar,Shobhit Singh Counsel for Opposite Party :- G.A.,Ratish Kumar Singh Hon'ble Saurabh Shyam Shamshery,J. 1. In present case, it appears that parties were entered into an agreement to sale in the year 2016, however, it was not materialized despite transaction of money and for that complainant has approached Civil Court by filing a civil suit against applicants for cancellation of agreement to sale which is still pending. 2. Facts of present case further reveal that during pendency of civil suit, both parties have allegedly entered into a compromise on 31.10.2021. 3. It is alleged by complainant that above referred compromise was not honoured by applicants and as such they have committed a criminal offence of cheating. In aforesaid circumstances, complainant has filed an application u/s 156(3) Cr.P.C. which was considered as a complaint case and thereafter statement of complainant and witnesses were recorded and impugned order was passed u/s 204 Cr.P.C. whereby applicants have been summoned to face trial for offence under Section 420 IPC.
Legal Reasoning
“9. The law with regard to exercise of jurisdiction under Section 482 of Cr. P.C. to quash complaints and criminal proceedings has been succinctly summarized by this Court in the case of Indian Oil Corporation v. NEPC India Limited1 after considering the earlier precedents. It will be apposite to refer to the following observations of this Court in the said case, which read thus: “12. The principles relating to exercise of jurisdiction under Section 482 of the Code of Criminal Procedure to quash complaints and criminal proceedings have been stated and reiterated by this Court in several decisions. To mention a few— Madhavrao Jiwajirao Scindia v. Sambhajirao Chandrojirao Angre [(1988) 1 SCC 692 : 1988 SCC (Cri) 234], State of Haryana v. Bhajan Lal [1992 Supp (1) SCC 335 : 1992 SCC (Cri) 426], Rupan Deol Bajaj v. Kanwar Pal Singh Gill [(1995) 6 SCC 194 : 1995 SCC (Cri) 1059], Central Bureau of Investigation v. Duncans Agro Industries Ltd. [(1996) 5 SCC 591 : 1996 SCC (Cri) 1045], State of Bihar v. Rajendra Agrawalla [(1996) 8 SCC 164 : 1996 SCC (Cri) 628], Rajesh Bajaj v. State NCT of Delhi [(1999) 3 SCC 259 : 1999 SCC (Cri) 401], Medchl Chemicals & Pharma (P) Ltd. v. Biological E. Ltd. [(2000) 3 SCC 269 : 2000 SCC (Cri) 615], Hridaya Ranjan Prasad Verma v. State of Bihar [(2000) 4 SCC 168 : 2000 SCC (Cri) 786], M. Krishnan v. Vijay Singh [(2001) 8 SCC 645 : 2002 SCC (Cri) 19] and Zandu Pharmaceutical Works Ltd. v. Mohd. Sharaful Haque [(2005) 1 SCC 122 : 2005 SCC (Cri) 283]. The principles, relevant to our purpose are: (i) A complaint can be quashed where the allegations made in the complaint, even if they are taken at their face value and accepted in their entirety, do not prima facie constitute any offence or make out the case alleged against the accused. For this purpose, the complaint has to be examined as a whole, but without examining the merits of the allegations. Neither a detailed inquiry nor a meticulous analysis of the material nor an assessment of the reliability or genuineness of the allegations in the complaint, is warranted while examining prayer for quashing of a complaint. (ii) A complaint may also be quashed where it is a clear abuse of the process of the court, as when the criminal proceeding is found to have been initiated with mala fides/malice for wreaking vengeance or to cause harm, or where the allegations are absurd and inherently improbable. (iii) The power to quash shall not, however, be used to stifle or scuttle a legitimate prosecution. The power should be used sparingly and with abundant caution. (iv) The complaint is not required to verbatim reproduce the legal ingredients of the offence alleged. If the necessary factual foundation is laid in the complaint, merely on the ground that a few ingredients have not been stated in detail, the proceedings should not be quashed. Quashing of the complaint is warranted only where the complaint is so bereft of even the basic facts which are absolutely necessary for making out the offence. (v) A given set of facts may make out : (a) purely a civil wrong; or (b) purely a criminal offence; or (c) a civil wrong as also a criminal offence. A commercial transaction or a contractual dispute, apart from furnishing a cause of action for seeking remedy in civil law, may also involve a criminal offence. As the nature and scope of a civil proceeding are different from a criminal proceeding, the mere fact that the complaint relates to a commercial transaction or breach of contract, for which a civil remedy is available or has been availed, is not by itself a ground to quash the criminal proceedings. The test is whether the allegations in the complaint disclose a criminal offence or not.” 12. In these circumstances, this Court finds that ingredients of Section 415/420 IPC are absolutely missing since there is no dishonest intention of applicants to enter into out of Court settlement. Only because it was not honoured by either party would not become an offence under Section 420 IPC. The Court also takes note of judgment of Raju Krishna Shedbalkar vs. State of Karnataka, 2024 SCC Online SC 200 and its relevant paragraphs 7,8 and 9 are quoted below -: "7. A perusal of the aforesaid provision shows that the offence of cheating is in two parts. The first is where a person fraudulently or dishonestly deceives another in inducing that person to deliver any property to any person etc. The second part of the offence would be made out if somebody is deceived to do an act which causes damage or harm to that person “in body, mind, or reputation or property is said to have cheated”. Time and again, this Court has reiterated that in order to make out an offence under cheating the intention to cheat or deceive should be right from the beginning. By no stretch of imagination, this is even reflected from the complaint made by the informant. 8. In the case of Hridaya Ranjan Prasad Verma v. State of Bihar (2000) 4 SCC 168, this Court held as under: “15. In determining the 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. It depends upon the intention of the accused at the time of inducement which may be judged by his subsequent conduct but for this subsequent conduct is not the sole test. Mere breach of contract cannot give rise to criminal prosecution for cheating unless fraudulent or dishonest intention is shown right at the beginning of the transaction, that is the time when the offence is said to have been committed. Therefore it is the intention which is the gist of the offence. 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.” (Emphasis supplied) 9. Further, in the case of Indian Oil Corporation v. NEPC India Ltd. (2006) 6 SCC 736 this position was reiterated in the following manner: 33. The High Court has held that mere breach of contractual terms would not amount to cheating unless fraudulent or dishonest intention is shown right at the beginning of the transaction and in the absence of an allegation that the accused had a fraudulent or dishonest intention while making a promise, there is no “cheating”. The High Court has relied on several decisions of this Court wherein this Court has held that dishonest intent at the time of making the promise/inducement is necessary, in addition to the subsequent failure to fulfil the promise. Illustrations (f) and (g) to Section 415 make this position clear: “(f) A intentionally deceives Z into a belief that A means to repay any money that Z may lend to him and thereby dishonestly induces Z to lend him money, A not intending to repay it. A cheats. (g) A intentionally deceives Z into a belief that A means to deliver to Z a certain quantity of indigo plant which he does not intend to deliver, and thereby dishonestly induces Z to advance money upon the faith of such delivery, A cheats; but if A, at the time of obtaining the money, intends to deliver the indigo plant, and afterwards breaks his contract and does not deliver it, he does not cheat, but is liable only to a civil action for breach of contract.” (emphasis supplied)" 13. In aforesaid circumstances, impugned summoning order dated 30.11.2023 passed by Chief Judicial Magistrate, Saharanpur in Complaint Case No. 8077 of 2023 (Paltu Ram vs. Smt. Shakuntala and others) under Section 420 IPC, Police Station- Kotwali Sadar Bazar, District- Saharanpur suffers with legal infirmities as ingredients of Section 415/420 IPC are not made out, hence, it is a fit case where inherent powers of this Court could be exercised. (see A.M. Mohan (supra)) 14. In view of above, impugned order referred above is hereby set aside. 15. Application is, accordingly, allowed. 16. However, Parties are at liberty to raise their legally permissible submissions before Civil Court. 17. Registrar (Compliance) to take steps. Order Date :- 26.7.2024 N. Sinha
Arguments
4. Sri Brijesh Kumar Yadav, learned counsel for applicants submits that even if contents of complaint and statements are considered to be true, still no offence is made out under Section 420 IPC as ingredients thereof are absent. 5. He further refers that alleged compromise has never been placed before proceedings of civil suit. 6. Aforesaid submissions are opposed by Sri Vivek Kumar Tiwari, learned counsel for opposite party-2 that in the application, existence of alleged compromise is being disputed by applicants therefore it is a case which could fall within parameters of cheating. 7. In order to appreciate rival submissions of parties, I have carefully perused the documents annexed along with this application and most relevant being statement of complainant recorded under Section 200 Cr.P.C. and impugned order are quoted below -: “ कक " मकरक लनख मम बननमन कपतन कल कलई पहसन उक ललरत नक जमदन कक नहह ससनन तथन पपतत कन अवललकन ककयन। पररवनदद कक पररवनद कथन एवव उसकक बयनन अनतररत धनरन 200 द०प०सव० जजसमम उसकक दनरन कथन ककयन रयन हह कपतन नक एक जमदन शकस नतलन व कवरकनद कल बकचद थद। 15 ककयन थन परनतस कदयक। बहननमक वनलक मकरक कपतन कल 8 कदए थक। मकरक कदन मकरक ककयन हहआ हह। कपतन नक उक ललरत कक महनक थननक व एसएसपद महलदय कल लनख रपयक कक बबक चकक उक ललरत नक जखलनफ जसकवल कलरर मम मसकदमन कशकनयत कक कलई कनयरवनहद नहह हहई।" कक पररवनदद नक अपनक बयननत मम पररवनद कथननक कन उक सक सपष हह पथमदषयन समथरन ककयन हह तथन पररवनदद कक बयनन अवतररत धनरन 200 द०प०सव० कन समथरन उसकक ओर सक परदककत करनयक रयक सनकदरण द०प०सव० व पद०डबलल ० 1 अनतररत धनरन 202 कक रप मम ठनकस पनल व पद०डबलल० 2 ककयन हह। कक रप मम ससखबदर सहनद नक भद पतनवलद पर उपलबध सनकय कक समयक पररशदलन सक कवकदत हलतन हह पररवनदद कक सनथ हहई घरननकम कन समथरन ककयन रयन हह। अतत मनमलक कक समसत तथय एवव पररससथकतयत कल दकषरत रखतक हहए कवपकद शदमतद शकस नतलन दकवद, रनमकस मनर व कव वरपनल कल अवतररत धनरन 420 कवचनरण हकतस तलब ककयक जननक कन पयनरप आधनर हह। ************* कवरकनद कस मनर, भन०दव० सव० कक अपरनध मम बयनन अनतररत धनरन 200 सद०आर०पद०सद० ननम पलरल रनमव पसत शद भरत जसवह उम 58 सदर बनजनर जजलन सहनरनपसर नक सशपथ बयनन कक कक मकरक जमदन शकस नतलन व कवरकनद कल बकचद थद। 15 परनतस मकरक वनलक कपतन कल उक ललरत कक महनक थननक व एस०एस०पद० महलदय कल हहई। मसझक नयनय चनकहए। सनल कनवनसद मनलहपसर थननन कपतन नक एक ककयन थन कदए। बयननमम कदए थक। मकरक ककयन हहआ हह। कशकनयत कक कलई कनयरवनहद नहह कपतन कल कलई पहसन उक ललरत नक जमदन कक नहह लनख र० कक चकक उक ललरत नक जखलनफ जसकवल कलरर मम मसकदमन लनख मम बयननमन कपतन कल 8 कदन मकरक ” 8. As referred above, complainant in his statement has not even referred the details of agreement to sale entered between the parties and wrongly stated that further agreement was made for sale for Rs. 15,00,000/- whereas as it was a part of alleged compromise. 9. It has not been in dispute that complainant has already filed a civil suit for cancellation of sale deed, therefore, a compromise between the parties taken place out of the Court could become enforceable, if brought on record of proceedings of civil suit and parties adhere to its contents. Ingredient of Section 415 IPC does not make out as parties on their own will have entered into compromise. 10. It is also relevant to note here that said compromise took place on 31.10.2021 but till date it has not been brought on record of the suit, despite suit proceedings are still pending. 11. A judgment of Supreme Court in A.M. Mohan Vs. State Represented by SHO and another, 2024 SCC OnLine SC 339 is relevant for adjudication of this case, therefore, its relevant paragraphs are quoted below -: