Dismissed

Harendra Pathak v. the State of Nagaland and Anr.

Gauhati HC2 Sept 2022Crl.Pet./803/2019

Case brief

AI extract

What is this about?

In a petition under Section 482 Cr.P.C. to quash an FIR alleging cheating and criminal breach of trust, the Guwahati High Court dismissed the plea. The court held that even if facts suggest civil liability, criminal proceedings may continue, and disputes regarding truth of allegations or veracity of documents cannot be adjudicated at the quashing stage.

What did the court decide?

Petition dismissed; stay vacated; parties to bear own costs.

Harendra Pathak Vs the State of Nagaland and Anr. — Cheque Dishonour | Gauhati HC (2022)

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Page No.# 1/13

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GAHC010154962019

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IN THE GAUHATI HIGH COURT ( HIGH COURT OF ASSAM, NAGALAND, MIZORAM & ARUNACHAL PRADESH )

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Crl. Petn. 803/2019

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Shri Harendra Pathak,

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C/o - M/s Pawan Enterprise, VIP- Road, Oppn. Rahman Hospital, Guwahati, Assam.

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……PETITIONER

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-Versus-

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1. State of Nagaland,

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2. M/s Sweety Confectionery,

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Puran Bazar, Dimapur,

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Represented by its Manager Shri Umang Jain

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…..RESPONDENTS

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APPEARANCE:-

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Advocate for the Petitioner : Shri D. Saud. Adv.

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Advocate for the respondent : Ms. T. Phom,

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P.P. Nagaland (R-1). Shri B.K. Jain.(R-2).

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Page No.# 2/13

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::: BEFORE:::

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HON’BLE MR. JUSTICE ROBIN PHUKAN

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Date of hearing : 22-07-2022

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Date of Verdict : 02-09-2022

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VERDICT (CAV)

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This petition, under Section 482 Cr.P.C. is preferred by Shri Harendra Pathak for quashing the complaint case No. 22/2019, under Section 420/406 of the Indian Penal Code, lodged by M/s Sweety Confectionery, Puran Bazar, Dimapur, Nagaland and pending before the Court of learned Chief Judicial Magistrate, Dimapur, Nagaland.

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02. The factual background leading to filing of the present petition is briefly stated as under:-

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“On 29.05.2019, M/s Sweety Confectionery, Puran Bazar, Dimapur, Nagaland through its Manager Shri Umang Jain, lodged one complaint case before the learned Chief Judicial Magistrate, Dimapur to the effect that the Firm, on good faith has given to the accused, who is also known as Arupji, and who is the proprietor of M/S Pawan Enterprise, on his desire and demand, varieties of Chips on regular basis and there was a business transaction/Sale analysis with effect from 01.04.2017 to 31.03.2018, total 85,358 units of goods, of

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Page No.# 3/13

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worth Rs. 73,65,587/ was given and the said transaction has been maintained by the Firm in its Ledger Account and the accused has to pay an outstanding amount of Rs.11,79,629/, on account of the same. The accused had made last payment of Rs. 2,00,000/ on 31.01.2018, and thereafter he stopped payment despite request made by the Firm, and he had adopted delaying technique in payment and thereby he cheated the Firm and committed breach of trust. The Firm then served one legal notice to the accused on 27.03.2019, but the same failed to yield any result.

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Upon the said complaint the learned Chief Judicial Magistrate, Dimapur has taken cognizance of the offence under section 420/406 IPC, vide order dated 29.05.2019, against the petitioner and issued process to him. Being highly aggrieved, the petitioner approached this court by filing the present petition on the ground that the allegation made by the Firm in the complaint, even if they are taken at their face value and accepted in its entirety, do not prima facie constitute any offence or make out any case under section 420/406 IPC rather it creates civil liability and the learned court below has miserably failed to appreciate the same, and the same is nothing but an abuse of the process of the court and the chances of conviction is bleak and impossible. Therefore, the petitioner has approached this Court, under Section 482 Cr.P.C. for quashing the complaint.

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Page No.# 4/13

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03. Heard Mr. D. Saud, learned counsel for the petitioner. Also heard Ms. T. Phom, learned P.P., Nagaland for respondent No.1 and Mr. B. K. Jain, learned counsel for the respondent No.2.

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04. Mr. Saud, the learned counsel for the petitioner, submits that the impugned order of taking cognizance suffers from manifest illegalities as from a bare perusal of the complaint and allegation made therein, even if taken at their face value, and accepted in its entirety, do not prima facie constitute any offence or make out any case under section 420/406 IPC, rather it creates civil liability. Mr. Saud further submits that no ingredients of the offence under section 406 and 420 IPC are made out and the learned court below has failed to appreciate the said facts. Mr. Saud further submits that from the complaint only civil liability is attracted, and therefore, it is contended to allow the petition by setting aside the impugned order. Mr. Saud has referred one case law- Prof. R K Vijayasarathy & Anr vs. Sudha Seetharaman & Anr.- Criminal Appeal No. 238 of 2019 of Special Leave Petition (Crl.) No. 1434 of 2018, in support of his submission. It is to be mentioned here that in the said case Hon’ble Supreme Court has held that –

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“ The jurisdiction under section 482 Cr.P.C. has to be exercised with care. In the exercise of its jurisdiction, a High Court can examine whether a matter which is essentially of a civil nature has been given a cloak of a criminal offence. Where the ingredients required to constitute a criminal offence are not made out from a bare reading of the complaint, the continuation of the criminal proceeding will constitute an abuse of the

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Page No.# 5/13

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process of the court.”

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05. Per contra, Mr. B. K. Jain, learned counsel for the respondent No.2 submits that there is sufficient material to constitute the offence under sections 420/406 IPC against the petitioner and there is no bar to prosecute the petitioner even the same facts and circumstances gives raise to civil liability. Mr. Jain submits that filing of the present petition is a delaying tactics of the petitioner and that the impugned order suffers from no illegality or infirmity requiring any interference of this court, and therefore, it is contended to dismiss the petition. Mr. Jain has referred two case laws in support of his submissions. (i) P. Sawarap Rani vs. M. Hari Narayan @ Hari Babu reported in (2008) 5 SCC 765 , (ii) Lalmuni Devi (Smt) vs. State of Bihar and Ors. reported in (2001) 2 SCC 17.

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06. On the other hand Ms. T. Phom, the learned P.P., Nagaland, appearing for the respondent No.1, submits that in view of availability of materials in the complaint to proceed against the petitioner, this petition is not maintainable.

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07. Having heard the submissions of learned Advocates of both sides, I have carefully gone through the petition and the documents placed on record. Also I have carefully gone through complaint case No. 22/2019 and the record of the learned Court below.

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08. A careful perusal of the complaint case, No. 22/2019, and the documents annexed therewith, reveals following circumstances:-

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Page No.# 6/13

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(i) That, there was business transaction between the complainant Firm - M/s Sweety Confectionery, and the petitioner, who is the proprietor of M/s Pawan Enterprise;

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(ii) That, on the desire and demand of the petitioner, varieties of Chips were supplied to him on regular basis on credit;

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(iii) That, business transaction/sale analysis, with effect from 01.04.2017 to 31.03.2018, reveals that 85,358 units of goods of worth Rs. 73,65,587/, was supplied to the petitioner;

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(iv) That, the complainant Firm maintained its Ledger Account in the name of Pawan Enterprise and the same reveals that the Pawan Enterprise has an outstanding amount of Rs.11,79,629/ to be paid to the complainant Firm;

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(v) The petitioner had made last payment of Rs. 2,00,000/ on 31.01.2018, and thereafter, he stopped payment despite request made by the complainant Firm;

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(vi) The complainant Firm had made several requests to the petitioner for repayment of the dues for the goods given on credit, but the petitioner, for one or the other reason had taken excuses, one after another, and thereby cheated the complainant Firm.

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(vii) The complainant Firm then served one legal notice upon the petitioner on 27.03.2019, but the same failed to yield any result;

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Page No.# 7/13

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09. In the given factual scenario it cannot be said that no factual foundation of the offence or no prima-facie case under section 420/406 IPC are made out. He took the goods from the complainant Firm on credit to the tune of Rs. 73,65,587/ and has outstanding amount of Rs. 11,79,629/, and he failed to make payment of the dues despite request. To ascertain as to whether all the ingredients of the said offences are made out or not, this court has to make an enquiry, which is not at all permissible in view of the law laid down by Hon’ble Supreme Court in M/s Neeharika Infrastructure Pvt. Ltd. Vs. State of Maharashtra & Ors., reported in (2021 SCC OnLine SC 315), where it has been held that:-

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(i) The power of quashing should be exercised sparingly with circumspection, as it has been observed, in the ‘rarest of rare cases (not to be confused with the formation in the context of death penalty).

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(ii) While examining an FIR/complaint, quashing of which is sought, the court cannot embark upon an enquiry as to the reliability or genuineness or otherwise of the allegations made in the FIR/complaint;

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(iii) Criminal proceedings ought not to be scuttled at the initial stage;

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(iv) Quashing of a complaint/FIR should be an exception rather than an ordinary rule;

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(v) Save in exceptional cases where non-interference would result in miscarriage of justice, the Court and the judicial process should not interfere at the stage of investigation of offences;

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(vi) Extraordinary and inherent powers of the Court do not confer an arbitrary jurisdiction on the Court to act according to its whims or caprice;

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Page No.# 8/13

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(vii) The power under Section 482 Cr.P.C. is very wide, but conferment of wide power requires the court to be more cautious. It casts an onerous and more diligent duty on the court;

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(viii) However, at the same time, the court, if it thinks fit, regard being had to the parameters of quashing and the selfrestraint imposed by law, more particularly the parameters laid down by this Court in the cases of R.P. Kapur (supra) and Bhajan Lal reported in 1992 AIR 604, has the jurisdiction to quash the FIR/complaint;

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10. It also appears that the petitioner has denied the assertions made in the complaint case No. 22/2019. It is his pleaded case that the said assertion in complaint case No. 22/2019, is false, and he made regular payment for the goods supplied by the complainant Firm to him and that the respondent has instituted the case before the learned Court of Chief Judicial Magistrate, Dimapur only to harass him and at best the allegations so made gives rise to civil liability.

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11. I have considered the contention of the petitioner and the submission of his learned counsel in this regard and also carefully gone through the case law- Prof. R K Vijayasarathy (supra) referred by him and I find that the ratio laid down therein would not come into his aid. There is no doubt in any manner that this court can examine whether a matter which is essentially of a civil nature has been given a cloak of a criminal offence. And where the ingredients required to constitute a criminal offence are not made out from a bare reading of the complaint, the continuation of the criminal proceeding will constitute an abuse of the process of the court and in the exercise of its jurisdiction this court can quash the same. But, the same is not the case here. Even agreeing to the contention of the

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Page No.# 9/13

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petitioner that the facts and circumstances give raise to civil liability, yet it cannot be said in the given facts and circumstances that no criminal offence is made out. Though in the case of Prof. R K Vijayasarathy (supra) an attempt has been made to find out whether ingredients of the offences under section 406/420 IPC are made out or not, yet, making of roving enquiry to that effect is held to be impermissible at that stage by a three Judge Bench in the case of M/s Neeharika Infrastructure Pvt. Ltd. (supra) . It is to be mentioned here that Prof. R K Vijayasarathy (supra) was a judgment of two Judge Bench.

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12. I have considered the submission of Mr. B.K. Jain, leaned counsel for the respondent and I find sufficient force in the same. And the case law referred by him also fortified his submission. In the case of P. Sawarap Rani (supra), Hon’ble Supreme Court has held as under:-

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“ There could be no dispute to the proposition that if the complaint does not make out an offence it can be quashed. However, it is also settled law that facts may give rise to a civil claim and also amount to an offence. Merely because a civil claim is maintainable does not mean that the criminal complaint cannot be maintained. In this case, on the facts, it cannot be stated, at this prima facie stage, that this is a frivolous complaint. The High Court does not state that on facts no offence is made out. If that be so, then merely on the ground that it was a civil wrong the criminal prosecution could not have been quashed.

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13. In the case of Lalmuni Devi (Smt)(supra) it has been held that:-

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Page No.# 10/13

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It is, however, well-settled that in a given case, civil proceedings and criminal proceedings can proceed simultaneously. Whether civil proceedings or criminal proceedings shall be stayed depends upon the fact and circumstances of each case.

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It is also held that:-

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“ Filing of an independent criminal proceeding, although initiated in terms of some observations made by the civil court, is not barred under any statute.”

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14. It also appears from the contention of the petitioner as well as from the submissions of his counsel that the same is directed towards the disputed question of facts. Moreover, the facts discussed herein above appear to be hazy and a detail enquiry is necessary to ascertain the acceptability of the same. In respect of the disputed question of facts, there is a well settled proposition of law through a string of judgments delivered by the Supreme Court in the cases of R.P. Kapur (supra), Bhajan Lal, (supra) The State of Bihar v. P. P. Sharma, 1992 Supp (1) SCC 222, and Zandu Pharmaceutical Works Ltd. (supra) that the same (disputed question of facts) cannot adjudicated by the court under section 482 Cr.P.C.

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15. In the case of Ramveer Upadhyay & Anr. Vs. State of U.P. & Anr. Special Leave Petition (Crl.) No.2953 of 2022, Hon’ble Supreme Court has held as under:-

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Page No.# 11/13

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39. In our considered opinion criminal proceedings cannot be nipped in the bud by exercise of jurisdiction under Section 482 of the Cr.P.C. only because the complaint has been lodged by a political rival. It is possible that a false complaint may have been lodged at the behest of a political opponent. However, such possibility would not justify interference under Section 482 of the Cr.P.C. to quash the criminal proceedings. As observed above, the possibility of retaliation on the part of the petitioners by the acts alleged, after closure of the earlier criminal case cannot be ruled out. The allegations in the complaint constitute offence under the Atrocities Act. Whether the allegations are true or untrue, would have to be decided in the trial. In exercise of power under Section 482 of the Cr.P.C., the Court does not examine the correctness of the allegations in a complaint except in exceptionally rare cases where it is patently clear that the allegations are frivolous or do not disclose any offence .

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16. In the case Mohd. Akram Siddiqui v. State of Bihar reported in (2019) 13 SCC 350, Hon’ble Supreme Court has held as under :-

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“ 5. Ordinarily and in the normal course, the High Court when approached for quashing of a criminal proceeding will not appreciate the defence of the accused; neither would it consider the veracity of the document(s) on which the accused relies. However an exception has been carved out by this Court in Yin Cheng Hsiung v. Essem Chemical Industries; State of Haryana v. Bhajan Lal and Harshendra Kumar D. v. Rebatilata Koley to the effect that in an appropriate case where the document relied upon is a public document or where veracity thereof is not disputed by the complainant, the same can be considered.”

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17. In the case of CBI v. Arvind Khanna, reported in (2019) 10 SCC 686, Hon’ble Supreme Court has held as under :-

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Page No.# 12/13

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“ 17. After perusing the impugned order and on hearing the submissions made by the learned Senior Counsel on both sides, we are of the view that the impugned order passed by the High Court is not sustainable. In a petition filed under Section 482 Cr.P.C, the High Court has recorded findings on several disputed facts and allowed the petition. Defence of the accused is to be tested after appreciating the evidence during trial. The very fact that the High Court, in this case, went into the most minute details, on the allegations made by the appellant CBI, and the defence put forth by the respondent, led us to a conclusion that the High Court has exceeded its power, while exercising its inherent jurisdiction under Section 482 Cr.P.C.

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18. In our view, the assessment made by the High Court at this stage, when the matter has been taken cognizance of by the competent court, is completely incorrect and uncalled for.”

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18. Thus, it can be crystallized from the discussion made here in above is that this court cannot embark upon an enquiry as to the reliability or genuineness or otherwise of the allegations made in the complaint. Therefore, it can be said that the herein this case the complaint, and the documents enclosed therewith, did not disclose commission of a cognizable offence at this stage, while the facts are hazy and also disputed. Moreover, the petitioner could not make out very exceptional circumstances to interfere with the case at the very threshold as held in the case of Bhajan Lal (supra) and M/s Neeharika Infrastructure Pvt. Ltd. (Supra). Whether the factual foundation of the offences alleged as made in the complaint would be sufficient to disclose the ingredients of the offences against petitioners has to be considered at the stage of trial. Such an enquiry cannot be embarked upon at this stage as held by Hon’ble Supreme Court in the case of M/s Neeharika Infrastructure Pvt. Ltd. (Supra), Ramveer Upadhyay (supra) Mohd. Akram Siddiqui (supra) and Arvind Khanna (supra).

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Page No.# 13/13

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19. Thus, in view of above discussions and finding and also in view of the submissions advanced at the Bar, I find the petition devoid of merit, and accordingly, the same stands dismissed. Stay, if granted earlier stands vacated. The parties have to bear their own cost.

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JUDGE

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Comparing Assistant

Harendra Pathak v. the State of Nagaland and Anr.

Case brief

What is this about?

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Harendra Pathak v. the State of Nagaland and Anr.

Case brief

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