CRIMINAL REVISIONAL JURISDICTION v. The State of West Bengal & Anr.

bear. The gravamen of the appellant's case in the FIR is that certain cheques had been given to the respondents, more particularly, the Commercial Manager with the specific understanding that these cheques can be presented against delivery of future vehicles and not for any past liability or dues, but the respondents presented the same which of course could not be encashed in view of the directions given by the appellant drawer. However the appellant had to sustain the loss of Rs 8982 as commission charges. The respondents filed application in the Delhi High Court for quashing of the FIR, inter alia, on the ground that the averments in the FIR do not make out the offence of either Section 406 or Section 420 as the necessary ingredients under Sections 405 and 415 IPC have not been indicated. The respondents also took the ground that the criminal proceedings pursuant to the FIR have been initiated with an ulterior motive and thereby there has been a gross abuse of the process of law and as such the FIR should be quashed. The High Court on consideration of the case of the parties and on the materials was of the opinion that the informant himself has already resorted to civil remedy for adjudication by an arbitrator and thereafter having lodged the complaint must be held to have abused the process of law and, therefore, the FIR should be quashed in the interest of justice.

3. Mr P.C. Jain, learned Senior Counsel appearing for the appellant contended before us that the assertions made in the FIR do constitute a cognizable offence and as such the same could not have been quashed in the light of the judgment of this Court in State of Haryana v. Bhajan Lal [1992 Supp (1) SCC 335 : 1992 SCC (Cri) 426] and the judgment of this Court in Rajesh Bajaj v. 10 State NCT of Delhi [(1999) 3 SCC 259 : 1999 SCC (Cri) 401 : JT (1999) 2 SC 112] .

4. Mr H.N. Salve and Mr Arun Jaitley, learned Senior Counsel appearing for different accused persons on the other hand contended that the assertions made in the FIR even taken on face value do not satisfy the ingredients of the offence alleged to have been made and on the other hand it manifestly indicates that the complainant has instituted the criminal proceedings with an ulterior motive for wreaking vengeance and to pre-empt the filing of the criminal complaint against him under Section 138 of the Negotiable Instruments Act and, therefore, the High Court rightly came to the conclusion that allowing the criminal proceedings to continue would result in manifest injustice and as such quashed the FIR, and this Court, therefore, would not be justified in interfering with the same in exercise of power under Article 136 of the Constitution. According to the learned counsel, issuance of process should not be allowed to be an instrument of oppression or needless harassment. Responsibilities and duties on magistracy lie in finding out whether the alleged accused would be legally responsible for the offence charged for. The court at that stage could be circumspect and judicious in exercising discretion and should take all the relevant facts and circumstances into consideration lest it would be an instrument in the hands of the private complaint as vendetta to harass the person needlessly. The learned counsel relied upon the decision of this Court in Punjab National Bank v. Surendra Prasad Sinha [1993 Supp (1) SCC 499 : 1993 SCC (Cri) 149] .

5. Bearing in mind the law laid down by this Court in the cases referred to earlier and the contentions raised by the learned counsel appearing for the parties and on examining the allegations made in the FIR, we are persuaded to accept the submission of Mr H.N. Salve and Mr Arun Jaitley, appearing for the respondents that the necessary ingredients of the offence of cheating or criminal 11 breach of trust have not been made out and on the other hand the attendant circumstances indicate that the FIR was lodged to pre- empt the filing of the criminal complaint against the informant under Section 138 of the Negotiable Instruments Act. The High Court, therefore, was well within its power in quashing the FIR as otherwise it wouldtantamount to an abuse of the process of court. We, therefore, see no justification for our interference with the impugned decision of the High Court in exercise of power under Article 136 of the Constitution.

6. This appeal accordingly fails and is dismissed.” ii. In Mahindra & Mahindra Financial Services Ltd. v. Rajiv Dubey reported in (2009) 1 SCC 706, the Hon’ble Supreme decided the following:- “3. In the complaint it was inter alia alleged as follows: The complainant as the Managing Director of Team Finance Company (P) Ltd., Janpath Tower, Bhubaneshwar had availed hire-purchase finance from Mahindra & Mahindra Financial Services Ltd., Appellant 1-accused with the consent and knowledge of its Managing Director, Appellant 2-accused in respect of a vehicle for a sum of Rs 1,89,000,00. He had given seven blank cheques drawn on Canara Bank, Main Branch, Bhubaneshwar in favour of Appellant 1-accused in the year 1994 when the agreement had been executed between the parties with mutual understanding that the said cheques would not be presented for encashment by the appellant- accused, but then payments would be made through demand drafts regularly till the entire amount was repaid. According to the complainant, in consonance with the said understanding the entire dues were repaid by him through demand drafts and after repayment he wrote a letter to Appellant l-accused for returning the blank cheques to him. However, without doing so, the appellant-accused mischievously and with ulterior motive 12 presented the cheques in the bank, a fact he learnt after receiving communication from the Bank concerned, as sufficient money was not available in his account. The cheques were presented in Bank by the appellant-accused even though their entire amount had been repaid by the complainant. This was done with a motive to cheat and harass the complainant and makes out offences under Sections 406 and 420 IPC. The court below after recording the initial statement of the complainant under Section 200 of the Code of Criminal Procedure, 1973 (in short “the Code”) perusing the materials produced before him and being prima facie satisfied about commission of the aforesaid offences took cognizance thereof. ….

10. In the meanwhile, in order to pre-empt the impending proceeding under Section 138 of the Act, the respondent filed a criminal complaint, CC No. 210 of 2000 against the appellants under Sections 406, 420, 294, 506, 34 IPC before the SDJM, Bhubaneshwar on 11-5- 2000, inter alia, claiming that the cheques issued by the respondent were towards an outstanding amount of Rs 1,89,000 and the said payment has already been made by the respondent by way of a demand draft of which no number, date or any other details are provided in the complaint. The appellants became aware of institution of such a case only later when the process was issued on 18-4-2001 and the same was received by the appellants. …

18. It is interesting to note that the respondent does not dispute issuance of cheques. Even a casual reading of the complaint does not show that the ingredients of Section 406 IPC are in any event made out. It is also not understandable as to how Section 294 has any application to the facts of the case much less Section 506 IPC. In addition to this, perusal of the complaint apparently shows the ulterior motive. It is clear that the proceeding initiated by the respondent clearly amounted to abuse of process of law. 13

19. In State of Haryana v. Bhajan Lal [1992 Supp (1) SCC 335 : 1992 SCC (Cri) 426 : AIR 1992 SC 604] , it was, inter alia, observed as follows : (SCC pp. 378-79, para 102) “102. In the backdrop of the interpretation of the various relevant provisions of the Code under Chapter XIV and of the principles of law enunciated by this Court in a series of decisions relating to the exercise of the extraordinary power under Article 226 or the inherent powers under Section 482 of the Code which we have extracted and reproduced above, we give the following categories of cases by way of illustration wherein such power could be exercised either to prevent abuse of process of any court or otherwise to secure the ends of justice, though it may not be possible to lay down any precise, clearly defined and sufficiently channelised and inflexible guidelines or rigid formulae and to give an exhaustive list of myriad kinds of cases wherein such power should be exercised: (1) Where the allegations made in the first information report or 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 a case against the accused. (2) Where the allegations in the first information report and other materials, if any, accompanying the FIR do not disclose a cognizable offence, justifying an investigation by police officers under Section 156(1) of the Code except under an order of a Magistrate within the purview of Section 155(2) of the Code. (3) Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same do not disclose the commission of any offence and make out a case against the accused. (4) Where the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated under Section 155(2) of the Code. 14 (5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused. (6) Where there is an express legal bar engrafted in any of the provisions of the Code or the Act concerned (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the Act concerned, providing efficacious redress for the grievance of the aggrieved party. (7) Where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge.” The case at hand falls under Category (7). …

20. Therefore, in view of what has been stated in Bhajan Lal case [1992 Supp (1) SCC 335 : 1992 SCC (Cri) 426 : AIR 1992 SC 604] , the proceedings in ICC No. 210 of 2000 before the learned SDJM, Bhubaneshwar stand quashed. The appeal is allowed.” iii. In Ashok Kumar Gupta v. State of U.P. reported in (2017) 11 SCC 239 the Hon’ble Apex Court held as follows:- “4. The appellant sought quashing of the said complaint on the ground that the criminal complaint was a counterblast to the notice of dishonour of cheque upon which a summoning order had been passed and proceedings under Section 138 of the Negotiable Instruments Act, 1881 were initiated by the appellant. The appellant relied on notice of dishonour, a copy of Criminal Complaint No. 135 of 2010 filed on 16-10- 2010 and order of the Court dated 4-11-2010. Reliance has been placed on the judgments of this Court in Eicher Tractor Ltd. v. Harihar Singh [Eicher Tractor Ltd. v. Harihar Singh, (2008) 16 SCC 763 : (2010) 4 SCC (Cri) 425] , Mahindra and Mahindra Financial Services Ltd. v. Rajiv 15 Dubey [Mahindra and Mahindra Financial Services Ltd. v. Rajiv Dubey, (2009) 1 SCC 706 : (2009) 1 SCC (Civ) 321 : (2009) 1 SCC (Cri) 603] from Zandu Pharmaceutical Works Ltd. v. Mohd. Sharaful Haque [Zandu Pharmaceutical Works Ltd. v. Mohd. Sharaful Haque, (2005) 1 SCC 122 : 2005 SCC (Cri) 283] . …

7. After hearing the learned counsel for the parties and perusing the records, we are satisfied that the complaint filed by the complainant is clear abuse of the process of law.” iv. In Eicher Tractor Ltd. v. Harihar Singh reported in (2008) 16 SCC 763 for consideration where the Hon’ble Supreme court held the following:- “8. In January 2001, Respondent 1 issued a cheque bearing No. 628701 dated 30-12-2000 for Rs 50,00,000 (fifty lakhs) discharging his liability towards the debt incurred against Appellant 1. In January 2001 the appellant presented the cheque bearing No. 628701 to his bank for withdrawal. On 23-1-2001, the bank returned the cheque with an endorsement on the return memo i.e. refer to the drawer.

9. On 5-2-2001, the appellant issued a legal notice under Section 138, Negotiable Instruments Act, 1881 (in short “the NI Act”). In January 2001, the appellant filed a complaint under Sections 138/142 read with Section 141 of the NI Act before the Court of Judicial Magistrate I, Faridabad. On 12-4-2001, the trial court after considering the complaint and the pre-summoning evidence took cognizance and issued summons against the respondent. Respondent 1 appeared and subsequently was released on bail.

10. On 4-10-2002, Respondent 1 filed a private complaint under Section 200 CrPC before the Civil Judge, (JD)/Judicial Magistrate, R.S. Ghat, District Barabanki alleging that the officials of Petitioner 1 herein had stolen the cheques bearing Nos. 0628701 to 0628704. It was further mentioned by him in the complaint that in the year 1998, he had informed Bank of Baroda, Barabanki that he has lost the aforesaid 16 cheques and also reported the same to the SHO, Barabanki. He further alleged that the appellants herein forged the cheque bearing No. 0628701 and presented the same in the bank at Faridabad, and thereby alleged that they had committed an offence under Sections 468 and 471 IPC.

11. On 8-2-2005, the complaint bearing No. 1343 of 2004 filed by Respondent 1 herein came up for hearing before the Civil Judge, (JD)/Judicial Magistrate, R.S. Ghat, Barabanki, Uttar Pradesh, and the learned Magistrate vide his order dated 8-2-2005 took cognizance of the matter and issued summons to the appellants.” v. In Capital First Limited v. Shree Shyam Pulses Private Limited, reported in 2019 SCC OnLine Cal 2149 where the following was held by the Hon’ble Supreme Court:- “15. The gravamen of the allegation in the complaint is that the petitioners converted the blank banking instruments into valuable documents and presented the same for encashment and got the same dishonoured with male fide intention.

16. In the instant case, the factum of issuance of blank cheques by the complainant is admitted. It is also admitted that cheques in question were drawn on an account maintained by the complainant with the banker. It is also an admitted fact that the complainant took loan of Rs. 10,00,000/- from the petitioner by executing a loan agreement on several terms and conditions to repay the same by way of 24 monthly instalment. It is also an admitted fact that the complainant made default in payment of loan i.e. there was existing debt or other liability to make payment. From Clauses 10.07, 10.08, 10.09, 10.10 and Clause 27 of the loan agreement and cheque submission form (CSF), it appears that pursuant to the loan agreement cheques in question were drawn in favour of Capital First Limited i.e. the petitioner no. 1 and the authorized representative Hemant Murarka signed on the cheques as authorized 17 representative of M/s. Shree Shyam Pulses Private Limited after knowing the contents of the agreement.

17. In this connection, Learned Counsel appearing for the petitioners has submitted that in view of Section 20 of the Negotiable Instruments Act the person who has handed over a blank cheque to another person, gives him authority to fill up the contents therein. It is his specific contention that the allegations in the complaint that the petitioners converted the blank cheques as valuable security, fraudulently has no basis at all.

18. In this connection, reliance may be placed on the decision of Sunil Kumar v. Escorts Yamaha Motors Ltd. reported in (1999) 8 SCC 468.

19. From paragraph 2 of the said judgment, it appears that the allegation in the FIR was that certain cheques had been given to the respondents “with the specific understanding that these cheques can be presented against delivery of future vehicles and not for any past liability or dues, but the respondents presented the same which of course could not be encashed in view of the directions given by the appellant drawer. However the appellant had to sustain the loss of Rs. 8982 as commission charges. The respondents filed application in the Delhi High Court for quashing of the FIR, inter alia, on the ground that the averments in the FIR do not make out the offence of either Section 406 or Section 420 as the necessary ingredients under Sections 405 and 415 I.P.C. have not been indicated. The respondents also took the ground that the criminal proceedings pursuant to the FIR have been initiated with an ulterior motive and thereby there has been a gross abuse of the process of law and as such FIR should be quashed.”

20. Hon'ble Apex Court dismissed the appeal after observing that the High Court was well within its power in quashing the FIR as otherwise, it would tantamount to an abuse of the process of the Court.

21. Similar view was taken by the Hon'ble Apex Court in the decision of Mahindra and Mahindra Financial Services Limited v. Rajib 18 Dubey reported in (2009) 1 SCC 706. Paragraph 18 of the said judgment runs as under:— “18. It is interesting to note that the respondent does not dispute issuance of cheques. Even a casual reading of the complaint does not show that the ingredients of Section 406 I.P.C. are in any event made out. It is also not understandable as to how Section 294 has any application to the facts of the case much less Section 506 I.P.C. In addition to this, perusal of the complaint apparently shows the ulterior motive. It is clear that the proceeding initiated by the respondent clearly amounted to abuse of process of law.”

22. In paragraph 19 of the said judgment Hon'ble Court made reference to the decision of State of Haryana v. Bhajan Lal and observed that the case at hand falls under category 7. Category seven of the judgment of State of Haryana v. Bhajan Lal is as under:— “7. Where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge.”

23. The factual scenario of the case at hand clearly indicated that the impugned criminal proceedings have been started as a counter blast to the proceedings initiated by the petitioners for dishonor of cheques issued by the complainant.

24. In this connection, another decision of the Hon'ble Apex Court in Eicher Tractor Limited v. Harihar Singh may be mentioned.

25. In paragraph 14 of the said judgment the Hon'ble Apex Court was pleased to observe as under:— “14. The case at hand squarely falls within the parameters indicated in Category (7) of Bhajan Lal case. The factual scenario as noted above clearly shows that the proceedings were initiated as a counterblast to the proceedings initiated by the appellants. Continuance of such 19 proceedings will be nothing but an abuse of the process of law. Proceedings are accordingly quashed.”

26. The above discussions lead me to observe that in the case at hand, the uncorroborated allegations made in the complaint do not prima facie constitute the commission of the alleged offences and the impugned criminal proceedings are the counterblast of the proceedings initiated against the complainant under the provisions of Negotiable Instruments Act.

27. In my opinion, the case at hand comes within parameters (7) of the decision of Hon'ble Supreme Court in State of Haryana v. Ch. Bhajan