Allowed

Bhaskar Chandra Mohanti v. State of Gujarat

Gujarat HC5 Dec 2013CR.MA/5528/2008

Case brief

AI extract

What is this about?

This judgment quashes an FIR registered under Sections 406, 420, and 114 IPC filed by a respondent as a counterblast to a civil suit. The Court held the dispute arose from commercial agency transactions lacking criminal intent.

What did the court decide?

FIR I-CR No. 65/2008 registered at Gorwa Police Station for offences under Sections 406, 420, and 114 IPC was quashed and set aside qua the applicants.

Bhaskar Chandra Mohanti Vs State of Gujarat — Contract and Commercial Disputes | Gujarat HC (2013)

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R/CR.MA/5528/2008 JUDGMENT

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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

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CRIMINAL MISC.APPLICATION NO. 5528 of 2008

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FOR APPROVAL AND SIGNATURE:

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HONOURABLE MR.JUSTICE A.G.URAIZEE

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1 Whether Reporters of Local Papers may be allowed to see the judgment ?

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2 To be referred to the Reporter or not ?

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3 Whether their Lordships wish to see the fair copy of the judgment ?

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4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 or any order made thereunder ?

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5 Whether it is to be circulated to the civil judge ?

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BHASKAR CHANDRA MOHANTI & 1....Applicant(s)

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Versus

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STATE OF GUJARAT & 1....Respondent(s)

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Appearance:

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MR BS PATEL, ADVOCATE for the Applicant(s) No. 1 - 2 MRS RANJAN B PATEL, ADVOCATE for the Applicant(s) No. 1 - 2 MR NEERAJ B SONI APP for the Respondent(s) No. 1 SERVED BY RPAD - (R) for the Respondent(s) No. 2

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CORAM: HONOURABLE MR.JUSTICE A.G.URAIZEE

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Date : 05/12/2013

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ORAL JUDGMENT

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Page 1 of 6

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R/CR.MA/5528/2008 JUDGMENT

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1. Heard Mr. C.B.Patel, learned advocate for Mr. B.S.Patel on behalf of the applicants and learned APP Mr. N.B.Soni appearing for respondent no. 1 State. Respondent no. 2 - original complainant though served has not chosen to enter his appearance either in person or by duly appointed advocate.

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2. The facts in brief giving rise to present
application are that the applicant and respondent
no. 1 are working with Gujarat Antibiotic
Industries Limited (hereinafter referred for the
sake of convenience and brevity as “the
industries”), which is situated at Manjusar as
well as Savli. The said industries is engaged in
the production of various drugs. An advertisement
came to be issued in the year 2006 on the website
as well as in the daily newspaper for appointment
of agency for sell and distribution of the drugs.
Respondent no. 2 applied for the agency on
17/12/2005. Respondent no. 2 was requested to
contact at Hotel Kanchandip, Jaipur on 28/8/2006
by letter dated 23/9/2006. Accordingly,
respondent no. 2 went to the hotel, where the
present applicants and others demanded Rs.
1,00,000/-. Accordingly, respondent no. 2 gave
three demand drafts total in Rs. 99,600/- in
favour of the industries. The receipt in respect
of the demand drafts is also given to him.
Thereafter, on 4/12/2006, respondent no. 2 was
asked to come with Rs. 4,00,000/-, which was paid

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Page 2 of 6

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by respondent no. 2. Respondent no. 2 was assured
that he would get Rs. 3,00,000/- as commission per
annum. The Memorandum of Understanding dated
12/2/2006 was executed between M/s Gujarat
Antibiotic Industries Ltd and respondent no. 1,
whereby respondent no. 2 was appointed for
warehousingstoringanddistributing
Pharma/Medical devices products manufactured and
or marketed by the said industries. The drugs
were dispatched to respondent no. 2 but it was not
found upto the standard. Therefore, respondent
no. 2 returned the consignment to the industries.
Thus, according to respondent no. 2 the applicants
gave false advertisement on the website and
induced him to part with Rs. 99,600/-, Rs.
4,00,400/-, Rs. 8,000/- for NOC, Rs. 1,00,000/-
interest for two years and Rs. 1,60,000/- for
office expenses. He lodged the complaint with
Gorva Police Station, which came to be registered
vide I-CR no. 65/2008 for the offences punishable
under Sections 406, 420, 114 of the Indian Penal
Code. The applicants have approached this Court
under section 482 of the Code of Criminal
Procedure, 1976 for quashment of this complaint.

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3. Learned advocate Mr. C.B.Patel appearing for the applicants has submitted that the dispute between the applicants and respondent no. 2 was purely in civil nature. He has further submitted that the applicants have filed civil suit no. 79/2007 in Small Causes Court, Baroda against respondent no.

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Page 3 of 6

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R/CR.MA/5528/2008 JUDGMENT

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1 to recover Rs. 23,385/- with interest for the
loss suffered by them. Learned advocate Mr. Patel
would also submit that the suit is filed in the
year 2007. Therefore, to pressurize the
applicants, the present complaint is filed by
respondent no. 2 as a counterblast to the suit
filed by the applicants. In the aforesaid
premise, he has urged that the FIR (Annexure “A”)
may be quashed and set aside.

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4. On the other hand, learned APP Mr. Soni has submitted that respondent no. 2 was induced by the applicant to part with huge amount and respondent no. 2 had to incurred expenses of Rs. 1,60,000/towards the office expenses. He has further submitted that the applicants supplied substandard drugs to respondent no. 2 and thereby he has suffered huge loss. Therefore, a prima face case is made out and the dispute cannot be said to be purely of a civil nature. Therefore, this application may be dismissed.

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5. There is no dispute that the applicants gave advertisement on their website as well as in daily newspaper inviting applications for appointment of agency for the purpose of distribution of various drugs manufactured by them and the respondent no. 2 made application pursuant to this advertisement. Learned advocate Mr. Patel for the applicants has also admitted that the applicants have received in all Rs. 5,00,000/- as deposit from respondent no.

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Page 4 of 6

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R/CR.MA/5528/2008 JUDGMENT

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2 for appointment as distributor. At the same
time, it becomes very clear from FIR (Annexure
“A”) that according to respondent no. 2 drugs
supplied by the applicants were not upto the
standard and were not marketable in Rajashthan.
Therefore, this drugs were returned by respondent
no. 2. Under the process, it appears that the
applicants have suffered some loss, for that, they
have instituted Civil Suit no. 79/2007 in the
Small Causes Court, Baroda. It is not the case of
respondent no. 2 that after accepting Rs.
5,00,000/- as deposit, the applicants has not
given him the agency, in fact, respondent no. 2
himself has stated in FIR (Annexure “A”) that
agency agreement was not executed between him and
the industries. Moreover, respondent no. 2
himself has stated in the FIR that the consignment
of drugs was sent to him but according to him, it
was not upto the standard could not be sold in
Rajasthan Market. Therefore, it cannot be said
that after taking Rs. 5,00,000/- from respondent
no. 2, the applicants did not give him agency and
thereby duped respondent no. 2. It appears that
the respondent no. 2 has filed FIR (Annexure “A”)
as counter-blast to the suit filed by the
applicants. The transactions between the
applicants and respondent no. 2 is of commercial
nature and the dispute is purely and essentially
of civil nature. Even if the allegation made in
FIR Annexure A are taken on its face value, it
does not reveal trapping of criminal offence.

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Page 5 of 6

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R/CR.MA/5528/2008 JUDGMENT

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6. Learned advocate Mr. Patel appearing for the
applicants relied upon reported judgement of
Honourable the Supreme Court in case of Suneet
Gupta Vs. Anil Triloknath Sharma and Ors and Swami
Raote and another reported in (2008) 11 SCC 670,
wherein also the dispute between the parties was
of civil nature arising from differences between
two partners of partnership firm and therefore,
dispute was based on commercial transactions and
element of mensria was not present. The criminal
liability was not involved and therefore, criminal
proceedings were quashed. In the present case
also the dispute is between the applicants and
respondent no. 2 has arisen from agency agreement
entered into between them. Further as noted above
the FIR (Annexure “A”) seems to have filed as
counter-blast to the Civil Suit filed by the
applicants in the Small Causes Court, Baroda. In
the back drop of these peculiar facts the FIR
(Annexure “A”) cannot be sustained and FIR being
I-CR No. 65/2008 registered with Gorwa Police
Station for the offences punishable under sections
406, 420, 114 of the Indian Penal Code is quashed
and set aside qua the applicants. Rule is made
absolute.

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(A.G.URAIZEE,J)

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*asma

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Page 6 of 6

Bhaskar Chandra Mohanti v. State of Gujarat

Case brief

What is this about?

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Bhaskar Chandra Mohanti v. State of Gujarat

Case brief

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