Allowed

Sunpat and 5 Ors. v. State of U.P. and Anr.

Allahabad HC12 Jul 2019A482/3160/2018

Case brief

AI extract

What is this about?

The High Court quashed criminal proceedings under Sections 406 and 420 IPC. It held that a dispute over non-execution of a sale deed is a civil matter regarding breach of contract. The court found essential ingredients for cheating and criminal breach of trust absent since no fraud was practiced at the time of transaction and the accused retained property ownership.

What did the court decide?

Application allowed; proceedings under Case No. 339 of 2018 are quashed.

Sunpat and 5 Ors. Vs State of U.P. and Anr. — Quashing and FIR | Allahabad HC (2019)

AFR

Court No. - 72

Case :- APPLICATION U/S 482 No. - 3160 of 2018

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Applicant :- Sunpat And 5 Ors. Opposite Party :- State Of U.P. And Anr. Counsel for Applicant :- Praveen Kumar Singh Counsel for Opposite Party :- A.G.A.,Moeez Uddin

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Hon'ble Rajiv Joshi,J.

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Heard Sri Anurag Bajpai holding brief of Sri Praveen Kumar Singh, learned counsel for the applicants and Sri Moeez Uddin, learned counsel for the opposite party no.2.

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Present application under Section 482 Cr.P.C. has been filed for quashing the charge sheet dated 12.12.2017 as well as the entire proceedings of Case No. 339 of 2018 (State Vs. Sunpat and others) arising out of Case Crime No. 610 of 2017, under Sections 406, 420 IPC, P.S. Dankaur, District Gautam Budh Nagar, pending in the court of Additional Chief Judicial Magistrate, Court No. 2, Gautam Budh Nagar.

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As per the prosecution case in the F.I.R., an agreement to sell was executed on 21.3.2015 by the father of the applicants in favour of first informant/opposite party no.2 in respect of property bearing Khata no. 128, Gata no. 142 Kha, measuring 0.0890 hectare situated as Village Mutaina, Pargana Dankaur, Tehsil Sadar, District Gautam Budh Nagar for a sale consideration of Rs. 7,00,000/-, out of which, a sum of Rs. 4,00,000/- was paid as earnest money and rest of the amount was agreed to be paid at the time of execution of sale deed. In the agreement, it is mentioned that the sale deed could be executed on or before 20.4.2015. After the execution of the said agreement to sell, father of the applicants, Jasram, died on 23.3.2015. Subsequently, second agreement to sell was executed between the applicants and the first informant, whereby the time for executing the sale deed was extended by 20.5.2015.

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It is further stated in the first information report that the first informant remained present for the whole day on 20.5.2015 in the office

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of Sub Registrat pursuant to the subsequent agreement, but the applicants did not turn up and therefore, they have cheated the applicants and committed criminal breach of trust by not executing the sale deed in his favour.

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The police after investigation, submitted the charge sheet no. 496/2017 on 12.12.2017 under Sections 406 and 420 IPC on which cognizance was taken by the Additional Chief Judicial Magistrate, Court No. 2, Gautam Budh Nagar on 15.11.2018 and all the applicants were summoned for trial for an offence under Sections 406 and 420 IPC, which is impugned herein.

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Learned counsel for the applicants submits that dispute between the parties is purely civil in nature arising out of registered agreement to sell executed by the father of the applicants and admittedly, the first informant/opposite party no.2 had paid Rs. 4,00,000/- and the balance amount was agreed to be paid at the time of execution of the sale deed and therefore, remedy lies with the first informant/opposite party no. 2 to file a suit for specific performance of contract before the civil court and therefore, no offence under Section 406/420 IPC for cheating and criminal breach of trust has been made out and the applicants have falsely been implicated deliberately in the present case with ulterior motive, and the prosecution being an abuse of process of the Court, is liable to be quashed.

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On the other hand, learned counsel for the opposite party no.2 submits that in spite of the fact that first informant/opposite party no.2 had appeared before the Sub Registrar pursuant to the agreement between the parties and remained present for the whole day, but the applicants did not turn up for executing the sale deed and therefore, they have cheated the first informant/opposite party no.2 and thus, have committed criminal breach of trust.

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Learned AGA have also opposed the submissions so raised by learned counsel for the applicants.

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I have considered the rival submissions and perused the record.

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The Apex Court in the case of State of Haryana and others Vs. Bhajan Lal and others, 1992 Supp (1) Supreme Court Cases 335, after considering the previous decisions of the Apex Court and the provisions of the Code, categories, power to be exercised while quashing the criminal prosecution under Section 482 Cr.P.C. Paragraph 102 of the said judgment mentioning the categories under which such extraordinary power can be exercised, is quoted hereunder:

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“ 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 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.

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(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.

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(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.

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(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.

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(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

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Magistrate as contemplated under Section 155(2) of the Code.

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(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.

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(6) Where there is an express legal bar engrafted in any of the provisions of the Code or 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.

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(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.”

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Admittedly, there is no dispute with regard to the execution of registered agreement to sell between the parties and the sale deed has not been executed till date by the applicants in favour of the first informant, hence, the appropriate remedy in the facts and circumstances of the case, is available to the first informant/opposite party no.2 to approach civil court by way of filing a suit for specific performance of contract on the basis of agreement to sell as the dispute between the parties is purely civil in nature.

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The offence under which the applicants have been summoned for trial are Section 406/420 IPC i.e. cheating and criminal breach of trust. The cheating has been defined under Section 415 of IPC, in the following terms:

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“ 415. Cheating.—Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit if he were not so

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deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, mind, reputation or property, is said to “cheat”.”

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From the definition of cheating, as per Section 415 IPC, following are the essential ingredients:

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“1. Deception of any person;

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(2)(a)fraudulently or dishonestly inducing that person;

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(I) to deliver any property to any person; (ii) to consent that any person shall retain any property; or

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(iii) or intentionally induce the person so deceived to do or omit to do anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm but that person, body, mind, reputation of property, is said to cheat.”

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To constitute cheating, fraud / deception has to be practiced by an accused at the time of entering into a transaction to induce the person so deceived to deliver any property to any person. Once a transaction takes place between the parties, subsequent dispute may amount to breach of contract, but no offence under Section 420 IPC is made out. This is a classical difference between "cheating" and "breach of contract".

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The allegations made in the first information report are that initially agreement to sell was executed by the father of the applicants and subsequently, another agreement was executed extending the time for executing the sale deed, but no sale deed has been executed by the applicants in favour of first informant/opposite party no.2 within the extended time and therefore, they have committed cheating. It appears that the essential ingredients of cheating are lacking in the present case and once the said ingredients of cheating are lacking, dispute, if any, remains in the realm of breach of contract, actionable in civil law.

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Section 405 defines criminal breach of trust as under:

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“405. Criminal breach of trust.--Whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied, which he has made touching the discharge of such trust, or wilfully suffers any other person so to do, commits "criminal breach of trust".

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The essential ingredients of Section 405 are as under:

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“1. Entrusting any person with property or with any dominion over property;

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2. That person entrusted

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(a) dishonestly misappropriating or converting to his own use that property; or

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(b) dishonestly using or disposing of that property or wilfully suffering any other person so to do in violation-

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(i) of any direction of law prescribing the mode in which such trust is to be discharged, or

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(ii) of any legal contract made touching the discharge of such trust of that person entrusted.”

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Admittedly, the applicants are the owner of the property in dispute and their father executed the registered agreement to sell in favour of the first informant and subsequently, another agreement was executed by the applicants extending the time for execution of the sale deed. The informant/opposite party no.2 is neither entrusted nor conveyed any dominion of the property in question by the applicants so far, despite execution of the registered agreement to sell, therefore, the applicants continue to be the owner of the property in question with a compromise under the agreement to execute a sale deed in favour of the informant/opposite party no.2 by 20.5.2015. The earnest money was paid

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in anticipation of a sale deed. The property in respect of which, criminal breach of trust committed must be either the property of some person other than the accused or the beneficial interest in or ownership of which must be of some other person and the accused must hold such property on trust for such other person or for his benefit which is missing in the present case. Thus, non-execution of a sale deed or non-refund of earnest would not amount to criminal breach of trust.

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On the allegations made in the F.I.R/charge-sheet, no offence whatsoever under Sections 420/406 is made out and the case is squarely covered by illustration (i) in the case of Bhajan Lal (supra) and the relevant ingredients for constituting the offence under Section 406/420 IPC are absent, as for that purpose, there must be an intention to cheat, which is missing in the present case.

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The application stands allowed. The proceedings of Case No. 339 of 2018 (State Vs. Sunpat and others) arising out of Case Crime No. 610 of 2017, under Sections 406, 420 IPC, P.S. Dankaur, District Gautam Budh Nagar pending in the court of Additional Chief Judicial Magistrate, Court No. 2, Gautam Budh Nagar are quashed.

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Order Date :- 12.7.2019 Noman

Sunpat and 5 Ors. v. State of U.P. and Anr.

Case brief

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Sunpat and 5 Ors. v. State of U.P. and Anr.

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