Premchand R. Nair and others v Integrated Housing Developers Limited and State of Kerala

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM** # **PRESENT** **THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS FRIDAY, THE 23[RD] DAY OF FEBRUARY 2024 / 4TH PHALGUNA, 1945** **CRL.MC NO. 2869 OF 2019** **CRIME NO.306/2017 OF MEDICAL COLLEGE POLICE STATION,** ## **THIRUVANANTHAPURAM** **AGAINST CC 1093/2018 OF ADDITIONAL CHIEF JUDICIAL** ## **MAGISTRATE, THIRUVANANTHAPURAM** ## **PETITIONERS/ACCUSED:** - **1 PREMCHAND R.NAIR S/O.K.P.RAMACHANDRAN NAIR, T.C.15/1447,SKYLINE,MELODY, VAZHUTHACAUD, THYCAUD.P.O, THIRUVANANTHAPURAM.** **2 REMA B.NAIR, W/O.V.P.B.NAIR, T.C.15/1447,SKYLINE, MELODY, VAZHUTHACAUD,THYCAUD.P.O, THIRUVANANTHAPURAM.** - **3 MOHANCHAND R.NAIR, S/O K.P.RAMACHANDRAN NAIR, T.C.17/876,'MOHANA', POOJAPPURA, THIRUVANANTHAPURAM.** - **4 S.BALU,** **S/O.SUBRAMANYAM, EE-38,METRO COTTAGE, SASTRI NAGAR EAST, KARAMANA.P.O, THIRUVANANTHAPURAM.** **BY ADVS. SRI.ABRAHAM MATHEW (VETTOOR) SRI.SIJI ANTONY SRI.ANIL ABEY JOSE SMT.ELIZABETH OLIVER** ## **RESPONDENTS/COMPLAINANT & STATE:** **1 INTEGRATED HOUSING DEVELOPERS LIMITED FLAT NO.E,GROUND FLOOR, ADITYA APARTMENT,RAMANATHAPURAM, TRICHY ROAD,COIMBATORE-45,** Crl.M.C. Nos.2869 & 2885/19 **-:2:-** **REPRESENTED BY ITS FORMER REGIONAL MANAGER AND AUTHORISED REPRESENTATIVE, MR.MAHESH, S/O.MANOHARAN, T.C.3/134, K.N.P.SADAN, PARUTHIPPARA,PATTOM P.O., THIRUVANANTHAPURAM.** **2 STATE OF KERALA, REPRESENTED BY SUB INSPECTOR OF POLICE, MEDICAL COLLEGE POLICE STATION, THIRUVANANTHAPURAM PIN 699004. BY ADV SRI.M.SREEKUMAR** **SMT. SREEJA V., PUBLIC PROSECUTOR** **THIS CRIMINAL MISC. CASE HAVING COME UP FOR ADMISSION** **ON 02.02.2024, ALONG WITH Crl.M.C. No.2885/2019, THE COURT ON 23.02.2024 PASSED THE FOLLOWING:** **-:3:-** Crl.M.C. Nos.2869 & 2885/19 # **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS** **FRIDAY, THE 23[RD] DAY OF FEBRUARY 2024 / 4TH PHALGUNA, 1945** **CRL.MC NO. 2885 OF 2019** **CRIME NO.283/2017 OF MEDICAL COLLEGE POLICE STATION,** ## **THIRUVANANTHAPURAM** **AGAINST CC 1092/2018 OF ADDITIONAL CHIEF JUDICIAL** **MAGISTRATE, THIRUVANANTHAPURAM** **PETITIONER/S:** - **1 PREMCHAND R.NAIR S/O.K.P.RAMACHANDRAN NAIR,** **T.C.15/1447,SKYLINE,MELODY, VAZHUTHACAUD, THYCAUD.P.O, THIRUVANANTHAPURAM.** **2 REMA B.NAIR, W/O.V.P.B.NAIR, T.C.15/1447,SKYLINE, MELODY, VAZHUTHACAUD,THYCAUD.P.O, THIRUVANANTHAPURAM. 3 MOHANCHAND R.NAIR, S/O K.P.RAMACHANDRAN NAIR, T.C.17/876,'MOHANA', POOJAPPURA, THIRUVANANTHAPURAM.** **4 S.BALU, S/O.SUBRAMANYAM, EE-38,METRO COTTAGE, SASTRI NAGAR EAST, KARAMANA.P.O, THIRUVANANTHAPURAM.** **BY ADVS. SRI.ABRAHAM MATHEW (VETTOOR) SRI.SIJI ANTONY SRI.ANIL ABEY JOSE SMT.ELIZABETH OLIVER** **RESPONDENTS/COMPLAINANT & STATE:** Crl.M.C. Nos.2869 & 2885/19 ## **-:4:-** **1 INTEGRATED HOUSING DEVELOPERS LIMITED FLAT NO.E,GROUND FLOOR, ADITYA APARTMENT,RAMANATHAPURAM, TRICHY ROAD,COIMBATORE-45, REPRESENTED BY ITS FORMER REGIONAL MANAGER AND AUTHORISED REPRESENTATIVE, MR.MAHESH, S/O.MANOHARAN, T.C.3/134, K.N.P.SADAN, PARUTHIPPARA,PATTOM P.O., THIRUVANANTHAPURAM.** **2 STATE OF KERALA, REPRESENTED BY SUB INSPECTOR OF POLICE, MEDICAL COLLEGE POLICE STATION, THIRUVANANTHAPURAM PIN 699004.** **BY SRI.NOUSHAD K.A., PUBLIC PROSECUTOR ADV SRI.M.SREEKUMAR** **THIS CRIMINAL MISC. CASE HAVING COME UP FOR ADMISSION** **ON 02.02.2024, ALONG WITH Crl.M.C. No.2869/2019, THE COURT ON 23.02.2024 PASSED THE FOLLOWING:** Crl.M.C. Nos.2869 & 2885/19 ## **-:1:-** **“C.R.”** ## **BECHU KURIAN THOMAS, J. -------------------------------Crl.M.C. Nos.2869 & 2885 of 2019** **---------------------------------** Dated this the day 23[rd] day of February, 2024 ## **ORDER** Two sale deeds executed by the petitioners have given rise to two criminal cases, both of which are being challenged in these petitions filed under section 482 of the Code of Criminal Procedure, 1973 (for short 'Cr.P.C.'). Since the material averments, the nature of allegations and the parties are identical, the cases are being disposed of by this common order. 2. Petitioners are the accused in C.C. No.1093 of 2018 and C.C. No.1092 of 2018, both on the files of the Additional Chief Judicial Magistrate Court, Thiruvananthapuram. The criminal cases arose from complaints filed by the first respondent on 07/02/2017 before the Thiruvananthapuram City Police Commissioner, on the basis of which FIR Nos.306/2017 and 283/2017 were lodged. Pursuant to the investigation, two separate final reports were filed on 25/04/2018, which are the subject matters of this dispute. 3. The final reports allege that the accused had committed Crl.M.C. Nos.2869 & 2885/19 ## **-:2:-** criminal breach of trust and cheating by selling 8 cents of land in Survey No.1283 as per sale deed No.3633/2012 for an amount of Rs.22,40,000/- and another 6 cents as per sale deed No.3527/2012 for an amount of Rs.10,60,000/-, despite having executed a power of attorney in favour of the defacto complainant relating to the same properties, and made unlawful gain to themselves and unlawful loss to the defacto complainant and thereby committed the offences under sections 406 and 420 read with section 34 of IPC. Except for the change in the sale deed numbers and the dates on which those deeds were executed, the allegations in both final reports indicate that the petitioners had, after issuing a power of attorney to the defacto complainant, sold the two properties included in the power of attorney to other persons, causing loss to the defacto complainant. 4. In order to appreciate the contentions advanced by the counsel for the respective parties, it is necessary to mention that petitioners 1 to 3 claim to be the absolute owners of an extent of 15.88 acres of land comprised in various survey numbers. After the petitioners decided to sell 13.25 acres of their properties, the defacto complainant came forward to purchase the property. An agreement was executed on 06/03/1992 for the sale of the properties at a rate of Rs.9,000/- per cent. The agreement stipulated the sale to be completed within 12 months, and an advance amount of Crl.M.C. Nos.2869 & 2885/19 ## **-:3:-** Rs.6,50,000/- was paid. However, the sale was not effected within the stipulated period as the defacto complainant did not pay the balance consideration within time. Later, a general power of attorney was executed by petitioners 1 to 3 in favour of the defacto complainant as document No.1652 dated 07/06/1994 of the Sub Registry Office, Thiruvananthapuram, in respect of an extent of 13.08 acres scheduled as item Nos.1, 2 and 3 to the power of attorney. 5. Petitioners allege that the properties sold by them as per sale deed Nos. 3633/2012 and 3527/2012 are not covered by the power of attorney. The defacto complainant, on the other hand, alleges that the sales were effected at a time when the power of attorney was in existence, and therefore, they have been cheated and even sustained losses. The defacto complainant had, in the meanwhile, mortgaged the properties on the basis of the power of attorney and obtained a loan from the Canara Bank, Thiruvananthapuram. It is thus alleged that, during the existence of the mortgage, the petitioners had executed the sale deed, and thereby, the defacto complainant sustained further losses. 6. Sri. Abraham Mathew Vettoor, the learned counsel for the petitioners, contended that, even if the entire allegations in the final report are assumed to be correct, still, no offence under sections 406 and 420 of IPC are made out. It was further submitted that the Crl.M.C. Nos.2869 & 2885/19 ## **-:4:-** attempt of the defacto complainant was to convert a civil dispute into a criminal case and to compel the petitioners to settle the civil dispute. He also submitted that the property sold by petitioners 1 to 3 are not covered by the power of attorney executed in favour of the defacto complainant and, therefore, the sale cannot even be questioned, nor can the power of attorney holder allege a criminal breach of trust or cheating. 7. Sri.M.Sreekumar, learned counsel for the defacto complainant, on the other hand, alleged that after an irrevocable power of attorney was executed, the petitioners could not have sold any portion of the property to third parties and further that on the basis of the general power of attorney, defacto complainant obtained a huge loan after mortgaging the properties. It was submitted that a portion of the mortgaged properties having been subjected to a sale, the accused have committed criminal breach of trust and cheating, and therefore, the jurisdiction under section 482 cannot be invoked. 8. I have heard Smt. Sreeja V. as well as Sri.K.A.Noushad, learned Public Prosecutors as well. 9. The fact that petitioners 1 to 3 were the owners of the two properties, which are the subject matter of this litigation, is not in dispute. The existence of a power of attorney during the relevant time is also not disputed. The circumstance that the power of attorney was Crl.M.C. Nos.2869 & 2885/19 ## **-:5:-** used to obtain a loan after mortgaging the properties covered by the power of attorney with the Canara Bank is also not disputed. The total extent of properties owned by the petitioners is stated to be 15.88 acres as per the recital in the power of attorney. The extent included in the power of attorney is only 13.08 acres as per the schedule attached to the said document. 10. While so, petitioners 1 to 3 executed two sale deeds, i.e., Sale deed No.3633/2012 in favour of Nandhitha Bhupathi relating to 8 cents and Sale deed No.3527/2012 in favour of J.S.Sherif relating to an extent of 6 cents. Petitioners contend that those properties covered by the aforementioned two sale deeds are not included in the power of attorney given to the defacto complainant, while the defacto complainant alleges that those properties are also included in the power of attorney. 11. Even if it is assumed that the power of attorney holder had, on the basis of the said authorization, kept the properties as a mortgage, legally, since the mortgage runs with the land, no prejudice can be caused either to the bank or to any third party as it will continue to be a charge on the property mortgaged. Significantly, the bank has not filed any complaint alleging that the property, which was subjected to a mortgage, has been sold to a third party. 12. The defacto complainant is only a power of attorney. There Crl.M.C. Nos.2869 & 2885/19 ## **-:6:-** is no provision of law which restricts the right of an owner to sell his property merely because the property is the subject matter of a power of attorney given to another person. A power of attorney is only an authorization given to another person to act on behalf of the owner. If the power of attorney had sold the property, the owner would be bound by such acts as long as the attorney was valid. However, if the owner had sold any portion of the property, which is covered by the power of attorney, then the power given under the attorney will be restricted or limited to the remaining extent. There cannot be any case of criminal breach of trust or cheating if the owner decides to sell a portion of the land, which is also the subject matter of a general power of attorney. Petitioners as title holders cannot be questioned by their power of attorney holder for executing sale deeds, even if the power of attorney covers the property. In view of the above, no criminal offence of cheating can be made out against the owners of a property if those owners had sold the property despite the existence of a power of attorney. 13. Further, there is no reference in the power of attorney that it is irrevocable. Even if such a terminology was used in the said deed, still, the mere use of the word 'irrevocable' will not make a power of attorney 'irrevocable' unless the terms in the document create or confer an agency coupled with interest in favour of the attorney. In Crl.M.C. Nos.2869 & 2885/19 ## **-:7:-** the absence of creation in the power of attorney, a power coupled with an interest in the property, as stipulated in section 202 of the Contract Act, 1872, there cannot be any irrevocability to the power conferred. 14. In this context, it is germane to refer to the decision in **Suraj Lamp and Industries Private Limited v. State of Haryana and Another** [(2012) 1 SCC 656], wherein the scope of power of attorney sales was referred to. The Court held that “ _A power of attorney is not an instrument of transfer in regard to any right, title or interest in an immovable property. The power of attorney is creation of an agency whereby the grantor authorizes the grantee to do the acts specified therein, on behalf of grantor, which when executed will be binding on the grantor as if done by him (See-S.1A and S.2 of the Powers of Attorney Act, 1882). It is revocable or terminable at any time unless it is made irrevocable in a manner known to law. Even an irrevocable attorney does not have the effect of transferring title to the grantee.”_ It was further held that “ _Except in cases where power of attorney is coupled with interest, it is revocable.”_ 15. Thus, no criminal liability for cheating or criminal breach of trust can be fastened on the petitioners for having sold the properties covered by sale deed No.3633/2012 and sale deed No.3527/2012, even if it is assumed that the power of attorney covered the properties. Crl.M.C. Nos.2869 & 2885/19 ## **-:8:-** 16. Apart from the above, whether the property is included in the power of attorney or not, is itself a matter of pure civil dispute. The power of attorney recites that petitioners 1 to 3 are the owners of 15.88 acres, and the properties covered by the schedule to that deed add upto an extent of 13.08 acres. The petitioners assert that the properties sold by them as per the title deeds referred earlier, were not the subject matter of the power of attorney, while the defacto complainant asserts that it is so. The said dispute falls within the realm of civil law and can be adjudicated only by a civil court. Neither the Investigating Officer nor a Criminal Court have the wherewithal to adjudicate such disputes. It is a matter which requires appreciation of evidence and tracing of title after due measurements are carried out. The property being large in extent, it will be practically impossible for a Criminal Court to arrive at a conclusion whether the properties, which were the subject matter of the two sale deeds, were included in the power of attorney or not. 17. A criminal prosecution should not be used with an ulterior motive or to compel the accused to settle disputes. When a criminal case has an overwhelming and predominant civil flavour, the inherent jurisdiction of this Court under S.482 Cr.P.C cannot be exercised. 18. The Supreme Court has on more than one occasion observed that when disputes are of a civil nature, complaints alleging Crl.M.C. Nos.2869 & 2885/19 ## **-:9:-** criminal offences ought not to be permitted. (Ref. **G.Sagar Suri v State of U.P.** [(2000) 2 SCC 636], **Indian Oil Corporation v. NEPC** [(2006) 6 SCC 736]) In the latter case, i.e. **Indian Oil Corporation’s** case, it was observed that “ _While on this issue, it is necessary to take notice of a growing tendency in business circles to convert purely civil disputes into criminal cases. This is obviously on account of a prevalent impression that civil law remedies are time consuming and do not adequately protect the interests of lenders/creditors. Such a tendency is seen in several family disputes also, leading to irretrievable breakdown of marriages/families. There is also an impression that if a person could somehow be entangled in a criminal prosecution, there is a likelihood of imminent settlement. Any effort to settle civil disputes and claims, which do not involve any criminal offence, by applying pressure through criminal prosecution should be deprecated and discouraged_ .” 19. In **G. Sagar Suri v. State of U.P** .[(2000) 2 SCC 636] also, it was observed that _"It is to be seen if a matter, which is essentially of a civil nature, has been given a cloak of criminal offence. Criminal proceedings are not a shortcut to other remedies available in law. ……..Jurisdiction under this section has to be exercised to prevent abuse of the process of any Court or otherwise to secure the ends of justice."_ Crl.M.C. Nos.2869 & 2885/19 ## **-:10:-** 20. This Court is thus satisfied that the dispute that arises out of the allegations is essentially civil in nature. In view of the above, the criminal proceedings initiated against the petitioners in C.C. No.1092 of 2018 and C.C. No.1093 of 2018 on the files of the Additional Chief Judicial Magistrate Court, Thiruvananthapuram, is an abuse of the process of court and is liable to be set aside. 21. Accordingly, all proceedings initiated against the petitioners in C.C. No.1092 of 2018 and C.C. No.1093 of 2018 on the files of the Additional Chief Judicial Magistrate Court, Thiruvananthapuram are hereby quashed. It is clarified that the observations made in this order are purely for the purpose of deciding these lis and shall not have any bearing on any civil dispute between the parties. These Crl.M.Cs are allowed as above. ## **Sd/JUDGE** ## **BECHU KURIAN THOMAS** ## vps ## **Corrigendum** dated 24.02.2024 The word 'cannot' appearing in paragraph 17 of this order shall stand corrected and substituted with the word 'can'. **Sd/BECHU KURIAN THOMAS JUDGE** vps **-:11:-** Crl.M.C. Nos.2869 & 2885/19 ## **APPENDIX OF CRL.MC 2869/2019** ## **PETITIONER'S/S' ANNEXURES** **ANNEXURE A1 A TRUE COPY OF F.I.R NO.0306/2017 REGISTERED BY SUB INSPECTOR OF POLICE, MEDICAL COLLEGE POLICE STATION, THIRUVANANTHAPURAM DATED 13.02.2017.** **ANNEXURE A2 A CERTIFIED COPY OF THE FINAL REPORT IN CC 1093/2018 DATED 25.04.2018 ANNEXURE A3 A TRUE COPY OF THE PETITION UNDER ENDT.NO.G-9736/2017/TC DATED 07.02.2017. ANNEXURE A4 A TRUE COPY PURCHASE CERTIFICATE NO.SM 12/198O ISSUED BY THE SPECIAL TAHSILDAR(LR),THIRUVANANTHAPURAM DATED 08.08.1980. ANNEXURE A5 A TRUE COPY OF THE POWER OF ATTORNEY EXECUTED BY THE PETITIONERS 1 TO 3 IN FAVOUR OF THE 1ST RESPONDENT AND REGISTERED AS DOCUMENT NO.1652 WITH THE S.R.O,TRIVANDRUM DATED 08.06.1994. ANNEXURE A6 A TRUE COPY OF THE SALE DEED NO.1434/1992 OF THE SRO THIRUVANANTHAPURAM DATED 03.04.1992. ANNEXURE A7 TRUE COPY OF THE BASIC TAX RECEIPT NO.0810172 ISSUED IN THE NAME OF LATE SRI.RAMACHANDRAN NAIR DATED 01.11.2010. ANNEXURE A8 A TRUE COPY OF THE E.C.ISSUED FROM THIRUVANANTHAPURAM SRO FOR THE PERIOD TO 01.01.1989 TO 24.12.2013 DATED 06.01.2014 ANNEXURE A9 DEED OF REVOCATION OF POWER OF ATTORNEY REGISTERED AS DOCUMENT NO.43/201O OF THE SRO THIRUVANANTHAPURAM DATED 8.7.1994. ANNEXURE A10 REPORT DATED 12.03.2019 SUBMITTED BY SRI.P.SREEHARI, ADVOCATE COMMISSIONER APPOINTED BY THE HON'BLE DEBT RECOVERY TRIBUNAL-II, ERNAKULAM IN I.A. NO.1319 OF 2018 IN S.A. NO.263 OF 2018 TOGETHER WITH INDEX AND DOCUMENTS PRODUCED ALONG** Crl.M.C. Nos.2869 & 2885/19 ## **-:12:-** ## **WITH THE REPORT** ## **ANNEXURE A11** **A TRUE COPY OF THE LETTER ISSUED BY THE CANARA BANK TO THE ADDL. TAHSILDAR, TALUK OFFICE, TRIVANDRUM DATED 04-09-2012.** ## **RESPONDENT'S/S' ANNEXURES** **ANNEXURE-R1(a) TRUE COPY OF THE LETTER DATED 7.7.2005 ISSUED BY RESPONDENTS 1 TO 3 TO THE CANARA BANK** **ANNEXURE-R1(b)** **CERTIFIED COPY OF LETTER REF.NO.ARM/2875/ARM45/2018 DATED 20.04.2018 FROM THE CHIEF MANAGER, CANARA BANK TO THE SUB INSPECTOR OF POLICE, MEDICAL COLLEGE POLICE STATION, THIRUVANANTHAPURAM** **ANNEXURE-R1(c) CERTIFIED COPY OF LETTER NO.CNO 213/2018 DATED 23.4.2018 FROM THE SUB REGISTRAR, THIRUVANANTHAPURAM TO THE SUB INSPECTOR OF POLICE, MEDICAL COLLEGE POLICE STATION, THIRUVANANTHAPURAM** Crl.M.C. Nos.2869 & 2885/19 **-:13:-** ## **APPENDIX OF CRL.MC 2885/2019** **PETITIONER'S/S' ANNEXURES** **ANNEXURE A1 A TRUE COPY OF F.I.R NO.283/2017 REGISTERED BY SUB INSPECTOR OF POLICE, MEDICAL COLLEGE POLICE STATION, THIRUVANANTHAPURAM DATED 11.02.2017.** **ANNEXURE A2 A CERTIFIED COPY OF FINAL REPORT IN C.C. 1092/2018 DATED 25.04.2018** **ANNEXURE-A3 A TRUE COPY OF PETITION UNDER ENDT.NO.G9737/2017/TC DATED 07.02.2017** - **ANNEXURE-A4 A TRUE COPY PURCHASE CERTIFICATE NO. SM 12/1980 ISSUED BY THE SPECIAL TAHSILDAR (LR), THIRUVANANTHAPURAM DATED 08-08-1980** - **ANNEXURE-A5 A TRUE COPY OF THE POWER OF ATTORNEY EXECUTED BY THE PETITIONERS 1 TO 3 IN FAVOUR OF THE 1ST RESPONDENT AND REGISTERED AS DOCUMENT NO. 1652 WITH THE S.R.O., TRIVANDRUM DATED 08.06.1994** - **ANNEXURE-A6 A TRUE COPY OF THE SALE DEED NO. 1434/1992 THE SRO THIRUVANANTHAPURAM DATED 13-04-1992** - **ANNEXURE-A7 A TRUE COPY OF THE BASIC TAX RECEIPT NO. 0810172 ISSUED IN THE NAME OF LATE SRI. RAMACHANDRAN NAIR DATED 01-11-2010** - **ANNEXURE-A8 A TRUE COPY OF TUE E.C. ISSUED FROM THIRUVANANTHAPURAM SRO FOR THE PERIOD 01-01-19896 TO 24-12-2013 DATED 06-01-2014** - **ANNEXURE-A9 DEED OF REVOCATION OF POWER OF ATTORNEY REGISTERED AS DOCUMENT NO. 43/2010 OF THE SRO THIRUVANANTHAPURAM DATED 18-01-2010** Crl.M.C. Nos.2869 & 2885/19 ## **-:14:-** ## **RESPONDENT'S/S' ANNEXURES** **ANNEXURE-R1(a) TRUE COPY OF THE LETTER DATED 7.7.2005 ISSUED BY RESPONDENTS 1 TO 3 TO THE CANARA BANK** **ANNEXURE-R1(b) CERTIFIED COPY OF LETTER REF.NO.ARM/2875/ARM45/2018 DATED 20.04.2018 FROM THE CHIEF MANAGER, CANARA BANK TO THE SUB INSPECTOR OF POLICE, MEDICAL COLLEGE POLICE STATION, THIRUVANANTHAPURAM** **ANNEXURE-R1(c) CERTIFIED COPY OF LETTER NO.CNO 213/2018 DATED 23.4.2018 FROM THE SUB REGISTRAR, THIRUVANANTHAPURAM TO THE SUB INSPECTOR OF POLICE, MEDICAL COLLEGE POLICE STATION, THIRUVANANTHAPURAM**