Allowed

Sarwan Mittal and Ors. v. the State of Jharkhand and Anr.

Jharkhand HC15 Jan 2024Cr.M.P./2487/2013

Case brief

AI extract

What is this about?

Quashing petitions against criminal proceedings over non-payment for hard coke supplies. The Court found no cheating intention from inception, roles of several accused undisclosed in the FIR, and a mechanical cognizance order, holding continuation would abuse process.

What did the court decide?

Entire criminal proceeding including order taking cognizance dated 09.12.2013 in Dhanbad P.S. Case No.32/2013 quashed; civil remedies left unaffected.

Sarwan Mittal and Ors. Vs the State of… — Contract and Commercial Disputes | Jharkhand HC (2024)

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IN THE HIGH COURT OF JHARKHAND, RANCHI

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Cr.M.P. No. 1343 of 2014

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Ravinder Kumar Mittal @ Ravi Mittal .... Petitioner

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-- Versus -- The State of Jharkhand and Another .... Opposite Parties

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With

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Cr.M.P. No. 2340 of 2013

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Ashok Mittal @ Dr. Ashok Kumar Mittal .... Petitioner

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-- Versus -- The State of Jharkhand and Another .... Opposite Parties With

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Cr.M.P. No. 2487 of 2013

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1.Sarwan Mittal @ Sharvan Kumar Mittal

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2.Smt. Pravin Garg @ Praveen Mittal 3.Manish Mittal @ Manu .... Petitioners -- Versus -- The State of Jharkhand and Others .... Opposite Parties

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CORAM: HON’BLE MR. JUSTICE SANJAY KUMAR DWIVEDI

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For the Petitioner :- Mr. Asim Malhotra, Advocate [Through V.C.]; Mr. A.K. Das, Advocate Mr. Niranjan Singh, Advocate Mr. Kanishka Deo, Advocate; Mr. Shailesh Kumar Singh, Advocate For the State :- Mr. P.D. Agarwal, Advocate Mr. Vishwanath Ray, Advocate For the O.P.No.2 :- Mr. Amit Kumar, Advocate ----

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6 /15.01.2024 Heard Mr. Shailesh, the learned counsel appearing for the petitioner in Cr. M.P. No.1343 of 2014, Mr. A.K. Das, the learned counsel for the petitioner in Cr.M.P. No.2340 of 2013 and Mr. Asim Malhotra, the learned counsel along with Mr. Lukesh Kumar, the learned counsel appearing through Video Conferencing from Delhi in Cr.M.P.No.2487 of 2013 for the petitioners, Mr. P.D. Agarwal and Mr. Vishwanath Roy, the learned counsels appearing on behalf of the respondent State in respective cases and Mr. Amit Kumar, the learned counsel appearing on behalf of the O.P.No.2.

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These petitions have been for quashing of the entire criminal proceeding including the order taking cognizance dated 09.12.2013 arising out of Dhanbad P.S. Case No.32 of 2013, corresponding to G.R.No.211 of 2013, pending before the court of learned Chief Judicial Magistrate, Dhanbad.

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By order dated 4.12.2014 in Cr.M.P. No. 2340 f 2013, notices were directed to be issued upon the O.P.No.2 and no coercive order has been ordered. During pendency of the present petitions, the learned court has been pleased to take cognizance by order dated 09.12.2013 which was challenged in Cr.M.P. No.2340 of 2013 by way of filing I.A. No.2496 of 2013 which was allowed by order dated 30.11.2020. The said order is also challenged by way of I.A. No.10467 of 2022 in another case and by the same order, the said I.A has also been allowed. The order taking cognizance is also under challenge in these Cr.M.Ps.

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The FIR has been filed alleging therein that the complainant being one of the partner of the partnership firm M/s Jagdamba Coke Manufacturers having its business of manufacturing of hard coke from raw coal. It is alleged that accused no.7 ( a local person) associated with accused, won the heart of the complainant and has given false

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assurance on behalf of the accused nos.1 to 6. The accused no.7 was working for accused no.1 to 6 for supply of hard coke since last 20 years. Through accused no.7, the accused nos.1 and 2 met the complainant and requested for supply of hard coke through accused no.7 and accused no.7 assured the complainant for payment of price amount of material supplied and accordingly complainant supplied hard coke to accused nos.1 to 6 who are the members of the same family and jointly doing business in the name of said firm. It is alleged that the complainant has supplied hard coke in financial year 2012-13 for Rs.32,08,989.35 on the basis of false representation made by accused no.7 and accused nos.1 to 6 committed dishonest criminal misappropriation and criminal breach of trust and also induced the complainant by adopting fraudulent method and caused wrongful loss to the complainant. It is alleged that on 29.07.2012 complainant refuse to supply hard coke without payment, the accused nos.5 and 6 promised to pay arrear payment and only in order to febuilt confidence deposited two cheques of Rs.4,00,000/- on 2.10.2012 and also for Rs.90,000/- on 9.10.2012 and again placed order for supply of hard coke. Lastly on 4.10.2013 the accused persons flately refused to pay.

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Mr. Shailesh, the learned counsel appearing in Cr.M.P. No.1343 of 2014 submits that these petitioners are not associated with Jagdamba Traders and unnecessarily the petitioner has been made accused. He submits that the petitioners are not operating the business of the coal of M/s Jagdamba Traders and only they are the family members of the proprietor of M/s Jagdamba Traders and they are residing at New Delhi and in spite of that, they have been made accused. He submits that even in the contents of the FIR it is admitted that certain amount has been paid and for recovery of the amount, the case has been filed.

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Mr. Das, the leraned counsel appearing for the petitioner in Cr.M.P. No.2340 of 2013 submits that the petitioner Ashok Mittal is a medical practitioner and he is placed at Lok Nayak Hospital, Government of N.C.T of Delhi and to buttress his such argument, he refers to the identity card of Dr. Ashok Mittal contained in Annexure-6 which has been brought by way of filing supplementary affidavit. He submits that no criminality is made out however in spite of that, the petitioner has been made accused and the learned court has taken cognizance.

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Mr. Asim Malhotra, the learned counsel appearing on behalf of the petitioner through the Video Conferencing from Delhi in Cr.M.P. No.2487 of 2013, submits that there is no allegation against the accused nos.5 and 6. He submits that the allegations are against the accused no.7 who is not before this Court. He submits that the entire allegations are with regard to money transaction and there is admission in the contents of the FIR itself that certain amount has already been paid and for recovery of the amount, the present case has been filed which is not in accordance with law. He further submits that the complainant is required to move before the concerned court of civil jurisdiction, however, complaint case is filed to cut short the litigation. He submits that recently the Hon’ble Supreme Court has considered this aspect of the matter of Dinesh Gupta v. State of Uttar Pradesh and Another, 2024 SCC Online SC 34 and he refers to paragraph nos.38 and 39 of the said judgment which are quoted below:

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“ 38. Before parting with the judgment, we are reminded

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of the opening remarks. The respondent Karan Gambhir having misused the legal system by lodging false and frivolous complaint with non-disclosure of necessary facts must bear its costs. The registration of FIR at Noida despite having registered offices of companies in question at Delhi shows a wishful forum shopping by the Complainant, casting serious doubts on their bona fides. The Complainant had already sought remedy against amalgamation order before

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the High Court and the High Court had dismissed the same. However, Complainant chose to again use judicial mechanisms to raise his grievances. A criminal complaint was filed and FIR was registered against appellants despite the commercial nature of dispute. Such ill intended acts of abuse of power and of legal machinery seriously affect the public trust in judicial functioning. Thus, we find ourselves constrained to impose cost on Complainant with a view to curb others from such acts leading to abuse of judicial remedies.

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39. Considering the above facts and circumstances of the case, we impose costs of Rs. 25 lakhs on the respondent Karan Gambhir to be deposited within four weeks from today with the Registry of this Court. Upon receipt of the said amount, the same will be transmitted in equal amount to the SCBA & SCAORA to be utilised for the development and benefit of their members.”

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Relying on the said judgment, Mr. Malhotra, the learned counsel submits that the entire criminal proceeding is bad in law that the dispute if any that is civil in nature and for that the complaint case has been filed and the learned court has been pleased to take cognizance.

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The said argument of the learned counsel for the petitioners is being resisted by Mr. Amit Kumar, the learned counsel appearing on behalf of the O.P.No.2 and submits that the case is made out and from the very beginning the aspect of cheating is there and the learned court has already been taken cognizance pursuant to the submission of the charge sheet and on these grounds he submits that the cases are required to be dismissed. He submits that the documents relied by the petitioners have not been produced before the investigating officer and that is why the case is made out. He submits that so far the accused nos.5 and 6 who are the petitioners in Cr.M.P. No.2487 of 2013 are concerned, the extension of stay was not there and they are the prime accused who have given part payment to the O.P.No.2. On these grounds, he submits that this Court may not interfere in these petitions at this stage.

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The learned counsels appearing on behalf of the respondent

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State jointly submits that the learned court has been pleased to take cognizance against the petitioners pursuant to the charge sheet and the case is still pending for appearance stage of the accused. He submits that the Court may not interfere at this stage.

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It is an admitted position that there is some dispute with regard to dues payment of supply of hard coke between the parties. There is nothing on record to suggest that any agreement is entered into between the accused persons and the O.P.No.2. The document brought on record in Cr.M.P. No.2340 of 2013 clearly suggest that the petitioner is a doctor placed in Lok Nayak Hospital, at New Delhi. Admittedly, in the entire contents of the F.I.R what are the role played by Dr. Ashok Kumar Mittal has not been disclosed and he has been arrayed as one of the accused and what are the role played by the petitioner namely Ravindra Kumar Mittal @ Ravindra Mittal who is petitioner in Cr.M.P. No.1343 of 2013 is further not stated in the contents of the F.I.R. The allegations are there against the proprietor of M/s Jagdamba Traders namely, Pravin Mittal and Pravin Mittal has already paid a sum of Rs.4,90,000/- which further suggest that the intention of cheating from the very beginning is not there as the allegations are made that for supply of coal in question the payment is not made. Thus, if from the very beginning the intention of cheating is not there, section 415 IPC is not attracted in the case in hand. From what have been discussed hereinabove, prima facie, it appears that for civil wrong, if any, the case has been registered and the petitioners have been made accused. In the case relied by Mr. Asim Malhotra, the learned counsel in the case of Dinesh Gupta v. State of Uttar Pradesh and Another (supra) wherein it is held in para-2 that misuse of criminal proceeding not only damages trust in our legal system but also sets a harmful precedent if not addressed. The said paragraph no.2 stipulates as under:

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“ 2. Unscrupulous litigants should not be allowed to go scot-free. They should be put to strict terms and conditions including costs. It is time to check with firmness such litigation initiated and laced with concealment, falsehood, and forum hunting. Even State actions or conduct of government servants being party to such malicious litigation should be seriously reprimanded. In the instant case, we find initiation of criminal proceedings before a forum which had no territorial jurisdiction by submitting incorrect facts and giving frivolous reasons to entertain such complaints. A closer look at the respondent's actions reveals more than just an inappropriate use of jurisdiction. The core issue of the dispute, which involves financial transactions and agreements, clearly places it in the realm of civil and commercial law. Yet, the respondent chose to pursue criminal charges in a quest to abuse the criminal justice system with a motive to seek personal vengeance rather than seeking true justice. This unnecessary turning of a civil matter into a criminal case not only overburdens the criminal justice system but also violates the principles of fairness and right conduct in legal matters. The apparent misuse of criminal proceedings in this case not only damages trust in our legal system but also sets a harmful precedent if not addressed.”

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Admittedly, in view of what has been discussed hereinabove, it appears that the dispute involves financial transaction and further there is no agreement to that effect and in spite of that, the FIR has been registered. Admittedly, some of the accused persons are not related with M/s Jagdamba Traders and they have been made accused. The Court looking into the order taking cognizance dated 09.12.2013 finds that the learned court has taken cognizance and the word ‘cognizance’ has been filled up in the blank space which further suggest that by way of non-application of mind, the learned court has taken cognizance. There is no doubt that in a case where charge sheet is there the learned court is having lesser responsibility of taking the cognizance, however, if such a dispute is there, what are prima facie dispute made out against the accused persons is one of the requirement to be reflected in the order taking cognizance, which is lacking in the case in hand. It is crystal clear that for business transaction, if any, the present case is filed. Further if such a situation is there and it is brought to the knowledge of

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the High Court, the High Court is having the responsibility to find out the things by way of reading the allegations in between the lines as has been held recently by the Hon’ble Supreme Court in the case of Haji Iqbal @ Bala v. State of Uttar Pradesh, 2023 SCC Online SC 946. In the case of Uma Shankar Gopalika v. State of Bihar and Another, (2005) 10 SCC 336 in paragraph no.6 of the said judgment, it has been held as under:-

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6. …… …… …. It is well settled that every breach of contract would not give rise to an offence of cheating and only in those cases breach of contract would amount to cheating where there was any deception played at the very inception. If the intention to cheat has developed later on, the same cannot amount to cheating. In the present case it has nowhere been stated that at the very inception there was any intention on behalf of the accused persons to cheat 5 Cr.M.P. No.617 of 2021 which is a condition precedent for an offence under Section 420 IPC.” (Emphasis supplied)

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In view of the above facts, reasons and analysis, the Court finds that to allow the present proceeding to continue further will amount to abuse of the process of law.

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Accordingly, entire criminal proceeding including the order taking cognizance dated 09.12.2013 arising out of Dhanbad P.S. Case No.32 of 2013, corresponding to G.R.No.211 of 2013, pending before the court of learned Chief Judicial Magistrate, Dhanbad, are hereby quashed. These petitions are allowed and disposed of in the above terms.

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It is made clear that if any civil proceeding is there, that will be decided in accordance with law without prejudice of this order as this order is passed examining the things as to whether any criminality is made out or not.

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Pending petition if any also stands disposed of accordingly.

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( Sanjay Kumar Dwivedi, J.)

Sarwan Mittal and Ors. v. the State of Jharkhand and Anr.

Case brief

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Sarwan Mittal and Ors. v. the State of Jharkhand and Anr.

Case brief

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