Dismissed

M/S Pradeep Coke Industries And Anr. v. Central Bureau of Investigatio

Jharkhand HC10 Dec 2019Cr.M.P./549/2012

Case brief

AI extract

What is this about?

High Court of Jharkhand dismissed a petition to quash criminal proceedings relating to alleged diversion of coal and falsification of records under Section 482 CrPC, finding sufficient prima facie evidence of cheating despite the civil contract nature.

What did the court decide?

Petition filed under Section 482 CrPC to quash FIR, charge sheet, and order taking cognizance was dismissed; order stands vacated.

M/S Pradeep Coke Industries And Anr. Vs… — Contract and Commercial Disputes | Jharkhand HC (2019)

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IN THE HIGH COURT OF JHARKHAND AT RANCHI

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Cr. M. P. No. 549 of 2012

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M/s. Pradeep Coke Industries, Ratanpura, G.T. Road, Govindpur, P.O. & P.S. Govindpur, Dist. Dhanbad through its Proprietor Anil Kumar Sanwaria, son of Sri Shankar Lal Sanwaria, resident of Chanchani Colony, P.O.- Nag Nagar, Dahiya Road, P.S.- Dhanbad, Dist.- Dhanbad, Jharkhand

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Anil Kumar Sanwaria, son of Sri Shankar Lal Sanwaria, resident of Chanchani Colony, P.O.- Nag Nagar, Dahiya Road, P.S.- Dhanbad, Dist.- Dhanbad, Jharkhand

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… … Petitioners

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Versus

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The Central Bureau of Investigation, CBI, ACB, Karmik Nagar, P.O. & P.S. Saraidhella, Dist. Dhanbad through Superintendent of Police.

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Superintendent of Police, Central Bureau of Investigation, A.C.B., Karmik Nagar, P.O. & P.S. Saraidhella, Dist. Dhanbad.

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Bharat Coking Coal Ltd. through its Chairman-cumManaging Director, Koyla Bhawan, P.O. Koyla Nagar, P.S. Saraidhella, Dist. Dhanbad. … … Opp. Parties

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CORAM: HON’BLE MRS. JUSTICE ANUBHA RAWAT CHOUDHARY

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For the Petitioners : Mr. Anil Kumar Sinha, Senior Advocate : Mr. Pankaj Kumar, Advocate For the State-C.B.I. : Mr. Rajiv Nandan Prasad, Advocate For the BCCL : Mr. Anoop Kumar Mehta, Advocate ---

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29 /10.12.2019

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1. Heard Mr. Anil Kumar Sinha, the learned Senior counsel appearing on behalf of the petitioners alongwith Mr. Pankaj Kumar, Advocate.

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2. Heard Mr. Rajiv Nandan Prasad, the learned counsel appearing on behalf of the C.B.I.

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3. Heard Mr. Anoop Kumar Mehta, the learned counsel appearing on behalf of the Opposite Party No.3 (Bharat Coking Coal Limited).

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4. This petition has been filed for quashing of entire criminal proceeding including the F.I.R. registered by the Central Bureau of Investigation, Dhanbad being F.I.R. No.

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RC.05(A)/2012-D dated 23.02.2012 which was registered under Sections 120B r/w 420 of the Indian Penal Code and Sections 13(2) r/w 13(1)(d) of the Prevention of Corruption Act, 1988 which is said to be pending before the learned Special Judge, CBI, Dhanbad.

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5. Charge-sheet was submitted during the pendency of the present case vide Charge-sheet No.08 dated 31.05.2013 which has been challenged alongwith order taking cognizance dated 16.01.2014 vide I.A. No. 9404 of 2019. Cognizance has been taken under Sections 420/468/471 of the Indian Penal Code against the Petitioner No. 1 which is the firm as well as Petitioner No. 2 who is proprietor of the Petitioner No. 1. Said I.A has been allowed and has been ordered to be treated as a part of the main petition vide order dated 18.11.2019.

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Arguments on behalf of the petitioners

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6. Learned Senior counsel for the petitioners submits that even if the entire allegation made in the charge-sheet is taken to be correct, then also no case is made out against the petitioners under the aforesaid Sections for which cognizance has been taken. Learned Senior counsel has further submitted that it is not in dispute that the unit of the petitioners is very old which was registered as Small Scale Industries (SSI) with District Industry Centre (DIC), Dhanbad since 29.09.1977 and was also under the partnership of Mr. Shankar Lal Sanwaria and Mr. Anil Kumar Sanwaria (Petitioner No. 2). Subsequently partnership was dissolved on 01.04.2001 and Mr. Anil Kumar Sanwaria (Petitioner No. 2) became the sole proprietor of the firm.

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7. He submits that check period involved in the present case is from 29.09.2008 i.e. date of entering into Fuel Supply Agreement with Bharat Coking Coal Limited ( in short BCCL)

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till 23.03.2011, i.e. date of physical inspection conducted by the team of CBI Officers and the BCCL Officers.

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8. Learned Senior counsel submits that during investigation, it has come and has been recorded in the charge-sheet that the Petitioner No. 1 entered into Fuel Supply Agreement on 29.09.2008 with Opposite Party No. 3-BCCL and was entitled to get coal to the extent of 40806 MT per annum of NLW Raw Coal from BCCL. As per clause 4.4 of the Fuel Supply Agreement, the Petitioner No.1 was compulsorily required to use the coal received under the agreement only for the purpose of preparation of hard coke. Learned Senior counsel also refers to the Joint Inspection Surprise Check (JSC) which was conducted on 23.03.2011 in the plant of the Petitioner No. 1 by a team of the CBI and BCCL officers and it was recorded in the charge-sheet that only 07 coke ovens (out of 21 coke ovens of the plant) were in operational condition. Physical balance of hard coke was 1044.28 MT on 23.03.2011 (date of JSC) and the opening balance of book stock was 950.750 MT and hence, difference between book stock and physical balance of hard coke was found to be 93.53 MT.

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9. Learned Senior counsel further refers to the charge-sheet where it has been recorded that the petitioners had received 30,175.970 MT of coal from BCCL under Fuel Supply Agreement during the said check period and the petitioner firm had also purchased 29,433.105 MT of coal from the source other than Fuel Supply Agreement from BCCL, CCL, ECL and other private parties during the said check period. He submits that other source of coal purchased through e-auction is an admitted fact. It has been alleged that the Petitioner No.1 has diverted FSA Coal during the said check period and created false and bogus records for concealment of their said diversion.

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10. Learned Senior counsel submits that so far as coal supplied through Fuel Supply Agreement is concerned, there is an obligation on the part of the unit to use the same for the purposes of manufacture of hard coke, but so far as coal purchased from other sources are concerned, i.e. e-auction coal, the Petitioner No.1 is free to use the same in any manner whatsoever. He submits that after considering the various records which were produced, the C.B.I. has ultimately come to a conclusion mentioned in the charge-sheet that the Petitioner No.1 has dishonestly diverted 3500.24 MT of coal received under Fuel Supply Agreement from Bharat Coking Coal Limited during the check period. It is alleged that it was not used at their unit.

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11. The learned Senior counsel submits that it is absolutely vague as to how this figure of 3500.24 MT of coal has been alleged to be diversion of coal received through Fuel Supply Agreement. Learned counsel has also emphatically submitted that even if this figure of 3500.24 MT of coal is taken to be correct, then also as per the own case of the CBI, the petitioners had purchased 29433.105 MT of coal from other sources and accordingly even if the entire allegation which is levelled against the petitioners in the charge-sheet is taken as correct, then also no criminal case is made out against the petitioners. The learned Senior counsel submits that entire allegation against the petitioners is based on assumption and presumption and there is no material on record to proceed against the petitioners under Sections 420, 468 and 471 of the Indian Penal Code. The CBI has calculated the alleged loss caused to Bharat Coking Coal Limited by multiplying the said figure with the difference of rate between the notified coal price (which was coal price for the purposes of supply under Fuel Supply Agreement) and the average rate of e-auction coal. It is

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alleged that the Bharat Coking Coal Ltd. would have earned Rs. 28 lacs and odd if 3500.24 MT of coal was sold through e- auction causing wrongful loss to the Bharat Coking Coal Ltd. 12. Learned Senior counsel for the petitioners has also submitted that the Petitioner No.1 was entitled to receive coal of 40,806 MT per annum under Fuel Supply Agreement, but the same was not supplied by the BCCL upto the said limit and less than 30% of the coal was actually supplied under the Fuel Supply Agreement which is apparent from the figure which has been mentioned by the CBI itself in the charge-sheet wherein the supply of coal under Fuel Supply Agreement for the entire check period 29.09.2008 to 23.03.2011 has been said to be only 30,175.970 MT. Learned Senior counsel further submits that there is no material to suggest as to how the CBI has calculated and mentioned 3500.24 per MT of coal and odd attributable to diversion of coal received under Fuel Supply Agreement and accordingly, the allegation made against the petitioners is absolutely vague and there was no concrete material available against the petitioners to proceed and take cognizance of the offences. He submits that aforesaid aspect of the matter has not been properly considered by the learned court below and accordingly, the entire criminal proceedings including order taking cognizance is fit to be set aside.

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13. The learned Senior counsel for the petitioners submits that the officials of the BCCL (Bharat Coking Coal Limited) were also made co-accused at the stage of registration of the F.I.R., but after investigation, no charge-sheet has been submitted against them and therefore, the allegation of conspiracy under Section 120-B and allegation under the provisions of Prevention of Corruption Act, 1988 is no longer there in the present case. He submits that the fact that the

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officers of the BCCL have been let off clearly indicates that the petitioners have been falsely implicated in the present case.

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14. The learned counsel for the petitioners, while challenging the entire criminal proceedings further submits that on account of following grounds also the order taking cognizance is fit to be set-aside:

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(i) The Central Bureau of Investigation has no jurisdiction to institute the FIR and to conduct the investigation.

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(ii) The entire allegation arises out of contract i.e. Fuel Supply Agreement (FSA) and no criminal liability can be imposed on account of violation of terms and conditions of the agreement.

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(iii) None of the ingredients of Sections 420, 120-B and 468 of I.P.C. is attracted in the facts and circumstances of these cases.

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Arguments on the point mentioned in Para-14(i)

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15. The learned Senior counsel for the petitioners while challenging the jurisdiction of the CBI has submitted that the Central Bureau of Investigation (CBI) is a creature of Statute and its jurisdiction has been defined under Delhi Special Police Establishment, Act 1946 (Hereinafter referred to as Act of 1946) . The Central Government by a notification has created Central Bureau of Investigation vide notification made under Section 2 of the said Act of 1946. According to Section 2(3) of the said Act of 1946, the Special Police has exclusive jurisdiction for the union territory alone. Section 5 of the aforesaid Act of 1946 deals with power of extension of jurisdiction of special establishment, but no such order has been issued by the Central Government giving absolute power to C.B.I. to investigate any offence in Jharkhand or in Bihar. It is also submitted that even under Section 6 of the aforesaid Act of 1946, the Government of Jharkhand has not given any consent for investigation by the

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C.B.I. It is further submitted that by Act No. 45/2003, an amendment has been made in aforesaid Act of 1946 and Section 6-A has been added, by virtue of which it has been provided that Delhi Special Police Establishment shall not conduct any enquiry or investigation into any offence alleged to have been committed under Prevention of Corruption Act, 1988 except with the previous approval of the Central Government against such Officer as appointed by the Central Government, where such allegations relate to such officers as are appointed by the Central Government in Corporations established by or under the Central Act, Government Companies, societies and local authorities owned or controlled by that government. The learned Senior counsel for the petitioners submits that the coaccused Sri Udayan Bhattacharya was the General Manager of Bharat Coking Coal Limited (BCCL) and he was neither the employee of Central Government, nor the Central Government ever appointed him, rather he has been appointed by the Coal India Limited, as such, the entire suo-moto investigation made by the C.B.I. is without authority of law, malafide and on extraneous consideration at the instance of syndicate of E- auction contractors. The learned Senior counsel refers to Section 5 of the aforesaid Act of 1946 and submits that it is for the Central Government to pass appropriate order under Section 5 to enable the C.B.I. to investigate any offence in a State and in absence of any such order by the Central Government under Section 5, the C.B.I. could not have instituted the case and carried out the investigation. He further submits that a counter affidavit has been filed in the instant case by the C.B.I., wherein certain notifications issued under Section 6 of the aforesaid Act of 1946 has been filed, but there is no such corresponding notification under Section 5 of the said Act of 1946 and in absence of a notification issued under Section 5 of the aforesaid

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Act of 1946, the notification issued under Section 6 of the aforesaid Act of 1946 is meaningless. Thus, he submits that the notification of the State issued under Section 6 is required to be preceded by a notification by the Central Government under Section 5 of the aforesaid Act of 1946. However, during the course of arguments, it has not been disputed that the same point has been decided by this court in the judgment dated 26.09.2019 in Cr.M.P. No. 773 of 2010 and other analogous cases which has been decided against the petitioners of the said cases and thus, the jurisdiction has been upheld.

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Submissions on the point mentioned in Para-14(ii)

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16. Learned Senior counsel for the petitioners submits that the allegation relates to violation of the terms and conditions of the Fuel Supply Agreement, which in turn, was entered into pursuant to New Coal Distribution Policy dated 18^th October, 2007. He submits that New Coal Distribution Policy dated 18^th October, 2007 was itself promulgated pursuant to the judgment passed by the Hon’ble Supreme Court in the case of M/s. Ashoka Smokeless Coal India Ltd. Vs. Union of India reported in (2007) 2 SCC 640 . The learned Senior counsel submits that by virtue of the aforesaid judgment passed by the Hon’ble Supreme Court, the policy of selling the coal through e-auction was done away with and certain directions were issued by the Hon’ble Supreme Court which ultimately led to formation of New Coal Distribution Policy. He submits that the New Coal Distribution Policy clearly indicates that so far as the consumers, like the units of the petitioners are concerned, 75% of the quantity as per the normative requirement of the petitioners would be considered for supply of coal through FSA (Fuel Supply Agreement) by Coal India Limited at notified prices to be fixed and declared by Coal India Limited. The balance 25% of coal requirement of the units will be sourced by

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them through e-auction/import of coal etc. and it was clearly indicated in the New Coal Distribution Policy that all the existing linked holders of erstwhile core and non-core sector and not having FSAs would be required to enter into Fuel Supply Agreement with the coal companies and as far as the linked consumers of erstwhile non-core sector whose annual requirement was less than 4,200 tonnes are concerned, they were to be given option to either enter into FSA with the coal company as per the terms and conditions including satisfaction level applicable to the other consumers or they may opt out of FSA (Fuel Supply Agreement) regime and access their coal requirement through agencies nominated by the State Governments.

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17. The learned Senior counsel submits that Para-2.3 and 4 of the New Coal Distribution Policy would be relevant for the purposes of this case. He also refers to clause 4.4 as well as clause 15 of the Fuel Supply Agreement (FSA) to submit that the consequences of violation of terms and conditions of the agreement has been mentioned therein and accordingly, even if it is assumed that the petitioners had violated the terms and conditions of the agreement, no criminality can be said to be involved in the entire transaction . He submits that at best the entire dispute can be a subject matter of civil dispute as per the terms and conditions of the agreement between the petitioners and the BCCL and the alleged offence arising out of violation of the terms and conditions of FSA (Fuel Supply Agreement) is itself an abuse of process of law.

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Submissions on the point mentioned in Para-14(iii)

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18. The learned Senior counsel for the petitioners further submits that at the stage of entering into the agreement i.e. FSA (Fuel Supply Agreement), there was no element of any fraudulent intention and accordingly, the basic element for

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constituting an offence under Section 420 of IPC is totally absent. He submits that no case under section 468 and 471 of IPC is made out against the petitioners.

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19. The learned Senior counsel for the petitioners has referred to the following judgments to submit that no criminal case is made out against the petitioners under Section 420 of IPC:

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a) (2003) 5 SCC 257 (Hira Lal Hari Lal Bhagwati –versusCBI, New Delhi), Para-40

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b) (2010) 10 SCC 361 (V.P. Shrivastava –versus- Indian Explosives Ltd and others), Paras-25 and 31

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c) (2009) 3 SCC 78 (V. Y. Jose and another –versus- State of Gujarat and Another), Paras-14, 21 and 22.

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Arguments on behalf of the Opposite Party-C.B.I.

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20. It is submitted by the learned counsel for the Opposite Party-C.B.I. that the point regarding jurisdiction of CBI to institute and investigate the case has been decided by this court in judgment dated 26.09.2019 passed in Cr.M.P. No. 773 of 2010 ( M/s. Parvati Fuels Pvt. Ltd –Versus- CBI) and other analogous cases and the point is squarely covered by the said judgment. He submits that in view of the aforesaid judgment, CBI has the jurisdiction to institute and investigate the present case.

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21. The learned counsel submits that it has been found during investigation that at the stage of entering into the agreement, the information regarding number of ovens available were incorrectly given which was the basis for assessment of the production capacity of the unit for allocation of coal for production of hard coke under fuel supply agreement.

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22. He further submits that during the check period, it has come in evidence that upon joint surprise inspection conducted on 23.03.2011, only 07 out of 21 coke oven plant were found in operational condition and it has also been found that

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entitlement of the petitioners to take coal under Fuel Supply Agreement was itself based on incorrect information given by the petitioners to the coal company and as per the charge-sheet, during the joint surprise check, only 21 coke oven existed, but it was obvious that the petitioners were not having 40 oven as mentioned in the report of Jharkhand Pollution Control Board which appears to be false and incorrect which might have been prepared without making any actual visit/inspection of the unit and the matter was sent to the concerned authority of the State Government for taking suitable departmental action in the matter.

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23. Learned counsel submits that during the examination of the records, it was observed that serious manipulation and interpolation have been made regarding use of the coal purchased by the petitioners under Fuel Supply Agreement as well as under e-auction purchase in as much as details regarding sale of finished products i.e. hard coke, which were found in the books of accounts were found to be substantially false. He further submits that detailed enquiry in connection with the same was made from the persons who were reported to have purchased the hard coke from the petitioners. Some of them were not the purchasers of the hard coke from the petitioners and some of them had also intimated and stated before CBI that the quantity of purchase of hard coke by these purchasers, as shown in the records of the petitioners, were not correct. Learned counsel for the CBI submits that falsification of records is ex-facie made out and the calculations of diversification of coal purchased under fuel supply agreement has been made on the basis of the verification which could be done by referring to the various parties, transporters and also vehicles used for the transportation which clearly indicate that the claim of sale of the entire finished products, as reflected in

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the books of the petitioners, is not correct. Learned counsel also submits that the quantity of diversion of coal received under Fuel Supply Agreement is based on investigation of the case and in the investigation, the month-wise availability of the coal for production of hard coke is also available.

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24. Learned Counsel for the C.B.I. further submits that the allegation indicates that even at the stage of entering into the agreement, there was intention to cheat and therefore, it cannot be said that the basic ingredient of Section 420 of IPC is absent. So far as the allegation regarding Sections 468 and 471 of I.P.C. is concerned, apparently, there are allegations of falsification of records by the petitioners to show that the coal purchased under fuel supply agreement was used for production of hard coke. Even if the coal is not an essential commodity within the meaning of Essential Commodities Act, but it is not in dispute that the coal is a scarce commodity and even as per the judgment passed by the Hon’ble Supreme Court, its sale and use are required to be regulated and for the purposes of which the New Coal Distribution Policy was framed, in which the FSA (Fuel Supply Agreement) was to be entered into for 75% of the coal requirement by the linked consumers and 25% was to be purchased through e-auction i.e. through open market. He further submits that there is no dispute that even the supply of coal which was made to the linked consumers by way of FSA (Fuel Supply Agreement) was to be made on the basis of the notified price of Coal India Limited, but coal supplied through FSA (Fuel Supply Agreement) could not be used for any other purpose except for production of hard coke. The learned counsel submits that no case for quashing of the F.I.R. or the charge-sheet or the order taking cognizance is made out.

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25. Learned Counsel for the Opposite Party-C.B.I. has referred to the judgment passed by the Hon’ble Supreme Court

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in the case of M. Jayanthi –versus- K.R. Meenakshi and Another passed in Criminal Appeal No. 1817 of 2019 and has referred to Paragraph-9 thereof to submit that in a petition under Section 482 of the Cr. P.C. for quashing a complaint or a charge-sheet, the court should not embark upon an enquiry into the validity of the evidence available. Learned counsel submits that the learned court below at the stage of taking cognizance has only to appreciate as to whether there is prima-facie case made out against the accused or not. He submits that so far as allegations regarding falsification of the records are concerned, no argument as such has been advanced on behalf of the petitioners that such allegations are false. Learned counsel submits that the points which have been argued on behalf of the petitioners cannot be appreciated at the stage of cognizance and they may take these points at appropriate stage before the learned court below once the police papers are supplied to the petitioners.

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26. Learned Counsel appearing on behalf of the Opposite Party No. 3 (BCCL) has supported the arguments placed by the learned counsel for the C.B.I..

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Findings of this Court

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27. After hearing the counsel for the parties and after considering the materials on record, this Court finds that the entire dispute revolves around FSA (Fuel Supply Agreement) pursuant to the New Coal Distribution Policy.

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28. So far as the point regarding jurisdiction of CBI to institute and investigate the case is concerned, the same has been decided by this court against the petitioners in the judgment dated 26.09.2019 passed in Cr.M.P. No. 773 of 2010 (M/s. Parvati Fuels Pvt. Ltd Versus CBI) and other analogous cases and the point is squarely covered by the said judgment.

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29. There is no dispute that the FSA (Fuel Supply Agreement) was entered into between the petitioners and the coal company pursuant to the New Coal Distribution Policy, which in turn, was a result of the judgment of the Hon’ble Apex Court reported in (2007) 2 SCC 640 (Ashoka Smokeless Coal India (P) Ltd. and others vs. Union of India and others). The Hon’ble Supreme Court was dealing with the matter regarding sale/distribution of coal and upon perusal of Para-192 of the aforesaid judgment, it is apparent that the Hon’ble Supreme Court found it difficult to identify as to who are the genuine customers. Accordingly, a scheme was to be framed by the coal companies for the purposes of separating the genuine customers of coal from the rest. Pursuant to the judgment passed by the Hon’ble Supreme Court reported in (2007) 2 SCC 640 (Ashoka Smokeless Coal India (P) Ltd. and others vs. Union of India and others) , New Coal Distribution Policy was framed and as per the provisions of the New coal Distribution Policy, the verification of erstwhile non-core sector consumers was to be undertaken which has been mentioned in the policy itself .

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30. It is not in dispute that the petitioners were the purchaser of coal under Fuel Supply Agreement as well as through other sources i.e. e-auction and the bifurcation of the purchase of coal during the period 29.09.2008 to 23.03.2011 was 30,175.970 MT and 29,433.105 MT respectively. This court also finds that as per the charge-sheet, the CBI had embarked upon an enquiry relating to standard yield at the stage of manufacturing of hard coke from the raw coal and has also given the details of so called false and fictitious coal sold by the petitioners and has given the names of certain firms/parties who refused to have purchase any coke from the petitioners, but such sales were shown in the records of the petitioners. The charge-sheet also reflects the names of the parties who have confirmed having

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purchased less coal from the petitioners, but higher quantity was projected in the books of the petitioners. The CBI has also made investigation with respect of the various vehicles claimed to have been used for the purposes of transportation of final product of the petitioners and had made investigation as to whether these vehicles had ever passed through the toll plaza on the date of sale as mentioned in the sale register and found adverse report against the petitioners. Investigation also revealed that certain vehicles which were shown to have been used for transportation of coal included two-wheeler vehicles and some vehicles which were projected to have carried huge quantity of coal which in the eyes of the Investigating Officer was an impossibility. The CBI has also alleged that upon verification of the documents in connection with the workmen employed in the unit, the thumb impression in the register of the unit was sent for examination and after examination expert, opinion has been received from the State Forensic Science Laboratory that most of the thumb impression are identical and the CBI has also found that the records in connection with the labour working in the unit of the petitioners was also found to be falsified. This court also finds that in the charge-sheet, the quantity of FSA coal, which has been shown to have been diverted, is based on the materials collected during investigation which has been found to be 3500.24 MT and so, the petitioners claim that this coal is relatable to the coal which was purchased through e-auction, is a matter of trial and cannot be appreciated at the stage of cognizance.

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31. The argument on behalf of the petitioners that the officers of the BCCL have been let off cannot be a ground to quash the entire criminal proceedings at the stage of F.I.R./order taking cognizance, considering the allegations made against the petitioners whereby prima-facie case for the purposes of taking

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cognizance of the offence against the petitioners has been made out. It has been alleged that the petitioners had given incorrect information / declaration by way of affidavit regarding availability of production capacity i.e. availability of number of ovens in order to avail linkage quota under the Fuel Supply Agreement which was to be used exclusively for production of hard coke and have diverted such coal causing wrongful loss to BCCL.

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32. This Court is of the considered view that merely because there is an agreement between the parties, it cannot be said that the criminal liability arising out of transactions between the parties is completely excluded if the basic ingredients of offence is available. There can be no dispute that there are situations where the civil consequences as well as criminal consequences arise out of the same transactions between the parties . Upon perusal of the charge-sheet, as quoted above, this Court finds that there is enough material on record to constitute a prima facie case under Sections 420, 468 and 471 IPC and to proceed against the petitioners.

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33. The learned Senior counsel has relied upon Para-40 of the judgment reported in (2003) 5 SCC 257 (Hira Lal Hari Lal Bhagwati –versus- CBI, New Delhi); Paras-25 and 31 of the judgment reported in (2010) 10 SCC 361 (V.P. Shrivastava – versus- Indian Explosives Ltd and others) and Paras-14, 21 and 22 of the judgment reported in (2009) 3 SCC 78 (V. Y. Jose and another –versus- State of Gujarat and Another) to submit that there exists a distinction between pure contractual dispute of a civil nature and an offence of cheating and in order to constitute an offence of cheating, the complainant is required to show that the accused had fraudulent or dishonest intention at the time of making promise or representation.

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34. This Court is of the considered view that the aforesaid judgments do not apply to the facts and circumstances of this case. Upon perusal of the charge-sheet of the present case, it cannot be said that there is no dishonest and fraudulent intention on the part of the petitioners, right from the stage of entering into agreement. The allegations reveal that the Fuel Supply Agreement itself was entered into by furnishing incorrect information. Thus, prima-facie , it cannot be said at this stage that there was no culpable intention right at the time of entering into the Fuel Supply Agreement. Further, there is allegation of falsification of records whose details have been mentioned in the charge-sheet.

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35. Accordingly, the argument on behalf of the petitioners that no prima-facie case is made out for constituting a case for taking cognizance of offence under sections 420, 468 and 471 IPC is hereby rejected at this stage.

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36. In the judgment relied upon by the learned counsel for the Opposite Party-C.B.I. i.e. M. Jayanthi –versus- K.R. Meenakshi and Another passed in Criminal Appeal No. 1817 of 2019, it has been held in Para-9 as follows: -

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“It is too late in the day to seek reference to any authority for the proposition that while invoking power under section 482 Cr.P.C for quashing a complaint or a charge, the court should not embark upon an enquiry into the validity of evidence available. All that the court should see is as to whether there are allegations in the complaint which form the basis for the ingredients that constitute certain offences complained of. The court may also be entitled to see (i) whether the pre-conditions requisite for taking cognizance have been complied with or not; and (ii) whether the allegations contained in the complaint, even if accepted in entirety, would not constitute the offence alleged.”

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37. Considering the allegations made against the petitioners in the light of the aforesaid judicial pronouncement by the Hon’ble Apex Court, this court is of the considered view that there is enough material on record to constitute a prima facie

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case for the purposes of taking cognizance of offence under Sections 420/468/471 IPC as per the charge-sheet based on the investigation of the case. Accordingly, this Court is not inclined to quash the entire criminal proceedings/charge-sheet against the petitioners and is also not inclined to quash the order taking cognizance of offences taken against the petitioners. Accordingly, the present petition is dismissed .

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38. It is however observed that dismissal of this case will not prejudice the case of the petitioners in any manner whatsoever and it will be open to the petitioners to raise all the points before the learned court below at appropriate stage.

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39. Interim order, if any, stands vacated.

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40. Pending interlocutory applications, if any, are also dismissed as not pressed.

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41. Let a copy of this order be immediately communicated to the court concerned.

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(Anubha Rawat Choudhary, J.)

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Binit

M/S Pradeep Coke Industries And Anr. v. Central Bureau of Investigatio

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M/S Pradeep Coke Industries And Anr. v. Central Bureau of Investigatio

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