Neeraj Sharma and Amith Thalwar v. State of Kerala and Johny A.A.

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MRS. JUSTICE M.R.ANITHA** **TUESDAY, THE 22ND DAY OF SEPTEMBER 2020 / 31ST BHADRA, 1942** ## **Crl.MC.No.2417 OF 2016** **CRIME NO.449/2013 OF Hosdurg Police Station , Kasargod** ## **PETITIONER/ACCUSED:** - **1 NEERAJ SHARMA AGED 45 YEARS, PROPRIETOR M/S.AURA EXIM, 203, GOUTHAM NAGAR, NEW DELHI 110049.** - **2 AMITH THALWAR AGED 52 YEARS GENERAL MANAGER/MARKETING, M/S.AURA EXIM, 203, GOUTAM NAGAR, NEW DELHI 110049.** **BY ADVS. SRI.T.B.SHAJIMON SMT.GOVINDU P.RENUKADEVI** ## **RESPONDENTS/RESPONDENTS/COMPLAINANT/STATE:** - **1 STATE OF KERALA REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM.682 031** - **2 JOHNY A.A. AGED 52 YEARS, S/O.ANTONEY, R/AT ALUKKAL, 18TH MILE, KALLAR VILLAGE, KOLICHAL PO, HOSDURG TALUK, KASARAGOD D.T 673 571** **R1 BY SMT. M.N. MAYA, PUBLIC PROSECUTOR R2 BY ADV. SRI.A.ARUNKUMAR** **THIS CRIMINAL MISC. CASE HAVING BEEN FINALLY HEARD ON 22.09.2020, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** **Crl.M.C.No.2417 OF 2016** **2** ## **O R D E R** ## **Dated : 22[nd] September, 2020** 1. This criminal miscellaneous case has been filed under Section 482 Cr.P.C. to quash the proceedings in crime No.449/2013 of Hosdurg police station, Kasaragode district. 2. Petitioners are the accused in the above crime. First petitioner is the proprietor and second petitioner is the Managing Director of M/s. Aura Exim based in New Delhi. Second respondent filed a private complaint before the Judicial First Class Magistrate Court-I, Hosdurg which was forwarded under Section 156(3) for investigation. 3. According to the petitioners, second respondent was conducting business in the name and style M/s.Malakkallu Stone Crusher. He purchased a rock breaker bucket on 05.09.2011 from the petitioners for a price of Rs.11,60,000/-. Due to the mishandling of the machinery by the non-expert employee of the second respondent, the machine stopped functioning and it is admitted by the second respondent that twice it was repaired at the instance of the petitioners. But he was not satisfied with the **Crl.M.C.No.2417 OF 2016** **3** purchase of the machine and thereafter Annexure AI complaint was filed. The allegations in the complaint would not attract any of the ingredients to constitute the commission of offence under Section 420 IPC and the court below mechanically forwarded the complaint to the police. Hence this case to quash Annexure-A2 FIR. 4. Notice was issued to the respondents and first respondent appeared through learned Public Prosecutor and second respondent/complainant appeared through Sri. A. Arunkumar. 5. Heard both sides. 6. The main contention of the learned counsel for the petitioners is that even admitting the entire allegations in Annexure AI complaint, it would not constitute the ingredients of an offence under Section 420 IPC. It is also his contention that already a case was filed before the Consumer Forum and that was dismissed and subsequently Annexure AI complaint was filed and mechanically it has been forwarded by the learned Magistrate. 7. At the outset I would make it clear that the contentions of the accused that the case filed by the complainant before the **Crl.M.C.No.2417 OF 2016** **4** Consumer Forum has been dismissed does not merit any consideration at this stage, since the court is not expected to verify the documents of the defence at this stage. 8. On going trough Annexure AI complaint what could be gathered is that the first allegation is with regard to the purchase of rock breaker bucket by the second respondent/complainant (hereinafter would be referred as the complainant) from the petitioners (hereafter be referred as accused) for a price of Rs.11,60,000/-. It is alleged in the complaint that at the instigation of the accused, complainant agreed to be the distribution agent of the product and he paid Rs.16,00,000/- towards the price of rock breaker bucket and advance for distributorship. But the accused charged Rs.13,77,000/- as the price of the rock breaker bucket instead of Rs.11,60,000/- which was fixed as the price of the product. Hence an excess of Rs.2,17,000/was charged without the knowledge and consent of the complainant and that is illegal and accused is liable to return the amount with interest. 9. The next allegation is that the rock breaker bucket to be attached with an excavator and it could be done only by an **Crl.M.C.No.2417 OF 2016** **5** experienced person and it is the duty of the accused to make arrangements. But it was not done in time and excavator has been attached only after one month of its purchase and because of the delay complainant could not function the rock breaker bucket and hence he suffered a loss of Rs.1,00,000/-. 10. Further allegation is that the rock breaker bucket with excavator stopped functioning and on contacting the accused several times technicians were appointed and machine was repaired. But again due to the manufacturing defect of the bucket it is not working at all and is kept idle. The accused is not responding to the request of the complainant to take back the machine and replace it and to pay cost of the same and complainant suffered huge loss and damages and the accused is liable to pay the price collected as the price for the rock breaker bucket. It was not returned. Lawyer notice was sent demanding the amount, but a false reply was sent and in the reply it has been stated that they collected an amount of Rs.1,17,000/in excess from the complainant. That according to the complainant shows the dishonest intention to cheat the **Crl.M.C.No.2417 OF 2016** **6** complainant and according to the complainant, accused jointly and severally induced him to purchase the product by misrepresentation and to part with a sum of Rs.16,00,000/- and thereby caused wrongful loss to the complainant and committed the offence under Section 420 IPC. 11. On going through the complaint, the entire allegations seems to be with respect to the monetary transaction in relation to purchase of the rock breaker bucket. It is admitted that subsequent to the purchase of rock breaker bucket, complainant agreed to be a distributing agent of the product and paid a total sum of Rs.16,00,000/- towards the price of rock breaker bucket and advance for distributorship. 12. The complaint also would show that at the request of the complainant twice it was repaired by the technical staff of the accused. It is further alleged that the rock breaker bucket is having some manufacturing defect and as of now it is kept idle and the complainant is demanding to take back the machine or replace it or to pay the costs of the same. The question is whether prima facie there is any **Crl.M.C.No.2417 OF 2016** **7** material to infer any dishonest intention on the part of the accused from the inception of purchase of machinery by the complainant. The complaint would reveal that the machine was purchased on 05.09.2011 and it is subsequent to that the complainant agreed to be the distributor of the product and paid the total amount of Rs.16,00,000/- both towards the value of the rock breaker bucket and advance for distributorship. Further there is allegation regarding excess charge for the machinery by the accused and that the rock breaker bucket could not be functioned since it was not attached with an excavator and on that account he suffered loss of Rs.1 lakh. Twice the technical staff of the accused came and repaired the Bucket. The further allegation is that the machinery has got some manufacturing defect and he requested to take back the machine or to pay the cost. So the whole allegation in the complaint is with regard to the loss sustained by the complainant due to the purchase of rock breaker bucket and incidental thereto. There is no material in the complaint to infer any dishonest intention on the part of the accused to cheat the complainant from the inception. **Crl.M.C.No.2417 OF 2016** **8** 13. It is contended by the learned counsel for the complainant that it is admitted in the reply notice that the accused has collected an amount of Rs.1,27,500/- in excess from the complainant. But the learned counsel for the accused would contend that the price is fixed by the company and not the accused and even if there is some variance with regard to the amounts charged for the machinery it cannot also be classified as a criminal offence so as to attract the offence under Section 420 IPC. 14. The rival contentions would show that the dispute between the parties is with regard to the purchase of rock breaker bucket by the complainant and the loss sustained in connection with the same. So the matter appears to be purely civil in nature and there appears to have no cheating or inducement for the delivery of the property at the inception. 15. So as has been rightly contended by the learned counsel for the accused/petitioners, the ingredients to attract Section 420 IPC is lacking from Annexure AI complaint and Annexure A2 FIR. A purely dispute is attempted to be given a colour of criminal offence, may be **Crl.M.C.No.2417 OF 2016** **9** as a short cut to settle the financial dealings. In this context, it is relevant to quote **Joseph Salvaraj A. v. State of Gujarat and Ors. [2011 KHC 4552 : AIR 2011 SC 2258]** wherein while dealing with Section 482 Cr.P.C. in a matter of quashing of criminal complaint under Section 405,S,415,S.,S.420,S.506 it has been held that mere failure to pay amount can not attract offence under Indian Penal Code.It is also held that cheating has been defined under Section 420. Under the aforesaid section it is inbuilt that there has to be a dishonest intention from the very beginning, which is sine qua non to hold the accused guilty for commission of the said offence. Categorical and microscopic examination of the FIR certainly does not reflect any such dishonest intention ab initio on the part of the appellant. It is also held that the matter appears to be purely civil in nature. There appears to be no cheating or dishonest inducement for the delivery of the property or breach of trust by the appellant and FIR is an abuse of process of law. The purely civil dispute, is sought to be given a colour of criminal offence to wreak vengeance against the appellant. It does not meet the strict standard of **Crl.M.C.No.2417 OF 2016** **10** proof required to sustain a criminal accusation. It is also held that in such type of case it is necessary to draw a distinction between a civil wrong and criminal wrong. 16. It is also relevant to quote **State of Haryana & Ors. v. Bhajan Lal & Ors. [1992 Supp (1) SCC 335]** wherein an elaborate consideration has been made with regard to the exercise of powers under Section 482 Cr.P.C by the High Court. In that the Apex Court has given some guidelines in the matter of exercise of the extra ordinary powers under Sec.226 or the inherent powers under Sec.482. The following in the above is relevant to be extracted here. “The following categories of cases can be stated by way of illustration wherein the extraordinary power under Article 226 or the inherent powers under Section 482 Cr.P.C can be exercised by the High Court either to prevent abuse of the 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. **Crl.M.C.No.2417 OF 2016** **11** (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. (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 of the concerned Act (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 concerned Act, 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 **Crl.M.C.No.2417 OF 2016** **12** 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. 17. So in the present case even if the entire allegations made in Annexure A1 and A2 are taken on their face value and accepted in their entirety, it would not prima facie constitute any offence or make out a case against the accused under Section 420 IPC. 18. **Devendra and Ors. v. State of U.P. and Anr. [2009** **KHC 656 : 2009 (7) SCC 495]** , is also relevant in this context to be extracted. It has been held there in that a distinction must be made between a civil wrong and a criminal wrong. When dispute between the parties constitute only a civil wrong and not a criminal wrong, the Courts would not permit a person to be harassed although no case for taking cognisance of the offence has been made out and hence it is found that the complaint is liable to be quashed. 19. So in the present case, on a close scrutiny of Annexure AI complaint and Annexure A2 FIR would show that the matter appears to be purely civil in nature and there is **Crl.M.C.No.2417 OF 2016** **13** nothing to infer any dishonest intention on the part of the accused from the very beginning of the transaction between the parties which led to the purchase of stone rock breaker bucket by the complainant. So Annexure AI and A2 are appears to be an abuse of process of law. 20. Time and again the Apex Court and this Court have laid down the proposition of the requirement of application of mind by the magistrate before exercising the jurisdiction under Sec.156(3). It is relevant in this context to quote **Saiyed v. State of Gujarat and Others (2008 (8) SCC 668)** wherein it has been held that when jurisdiction is exercised on a complaint filed in terms of Sec.156(3) of Sec.200 Cr.P.C the magistrate has to apply his mind. 21. It has been held in **Priyanka Srivastava and Another v. State of U.P. and Others (AIR 2015 SC 1758 : 2015 KHC 4242)** that there has to be prior application under Sec.154(1) and 154(3) while filing a petition under Sec.156(3). Both aspects should be clearly spelt out in the application and necessary documents to that effect shall be filed. It is also held that a stage has come in this country when Sec.156(3) applications are to be supported by an **Crl.M.C.No.2417 OF 2016** **14** affidavit duly sworn by the applicant who seeks the invocation of the jurisdiction of the magistrate. So in appropriate cases the magistrate can insist for an affidavit along with the complaint. On a mere glance through Annexure-A1 complaint would reveal total non-application of mind in forwarding the same under Sec.156(3) Cr.P.C. 22. In the result, Crl.M.C is allowed and Annexure A2 FIR of Hosdurg Police Station is quashed. **Sd/-** **M.R.ANITHA** **JUDGE** SHG/Mrcs **Crl.M.C.No.2417 OF 2016** **15** ## **APPENDIX** ## **PETITIONER'S/S ANNEXURES:** **A1 THE COPY OF THE COMPLAINT A2 THE COPY OF THE F.I.R**