Dismissed

Haeir Appliances (India) Pvt. Ltd. (* Corrected as 'Haier' Per Order Dtd 26-10-23 in CRL.MA1/23) v. State of Kerala

Kerala HC15 Jan 2024Crl.Rev.Pet/766/2022

Case brief

AI extract

What is this about?

Revision petition challenging framing of charges under Sections 120B, 405 and 420 IPC against a company's branch manager in a dealership-cum-distribution dispute involving misuse of a master cheque and appointment of a new distributor. The High Court found a prima facie case existed and dismissed the revision petition.

What the court decided

AI extract

*Haeir* Appliances (India) Pvt. Ltd. (* Corrected as… — Cheating and Forgery | Kerala HC (2024)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR.JUSTICE P.G. AJITHKUMAR

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MONDAY, THE 15^TH DAY OF JANUARY 2024 / 25TH POUSHA, 1945

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CRL.REV.PET NO. 766 OF 2022

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AGAINST THE ORDER DATED 26.09.2022 IN CC 125/2014 OF CHIEF JUDICIAL MAGISTRATE'S COURT, ERNAKULAM (CRIME NO.260/2014 OF ERNAKULAM CENTRAL POLICE STATION, ERNAKULAM)

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REVISION PETITIONER/ACCUSED NO.2:

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HAEIR APPLIANCES (INDIA) PVT. LTD. THURUTHIYIL BUILDING, BUILDING NO.1577 A, GEETHANJALI ROAD,NH.47,VYTILA,KOCHI-19, KERALA-682019, REPRESENTED BY ITS BRANCH MANAGER, DAMIEN.*

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BY ADVS. E.G.GORDEN S.K.KRISHNAKUMAR V.M.MARY HARSHA BONIFUS P.A.

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RESPONDENTS/DEFACTO COMPLAINANT & ACCUSED NO.1:

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1 STATE OF KERALA REP BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM, PIN - 682 031.

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2 M/S. SURYA MARKETING, 3/391, C8, KAYPEES PLAZA, NEAR BYE-PASS JUNCTION, RAMANATTUKARA, KOZHIKKODE, RESPRESENTED BY ITS MANAGING PARTNER, K.T. NATHEER, S/O. K.T MOHAMMED ADURAHIMAN, AGED 42 YEARS, 'AJINAS', ANKAPARAMBA, P.O.PUTHOOR PALLIKKAL, MALAPPURAM DISTRICT, KERALA-673636.

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3 HAEIR APPLIANCES (INDIA) PVT. LTD. B-1/A-14, MOHAN CO-OPERATIVE INDUSTRIAL ESTATE, MATHURA ROAD, NEW DELHI, PIN-110044 REPRESENTED BY ITS AUTHORIZED REPRESENTATIVE MR.TARUN KAMBOJ.*

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*CORRECTED AS 'HAIER' PER ORDER DTD 26-10-23 IN CRL.MA1/23.

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Crl.R.P.No.766 of 2022

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R1 BY SMT.SEENA C., PUBLIC PROSECUTOR

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R2 BY ADV P.C.MUHAMMED NOUSHIQ

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THIS CRIMINAL REVISION PETITION HAVING COME UP FOR FINAL HEARING ON 19.12.2023, THE COURT ON 15.01.2024 DELIVERED THE FOLLOWING:

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Crl.R.P.No.766 of 2022

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P.G. AJITHKUMAR, J.

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----------------------------------------------------------Crl.R.P.No.766 of 2022

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----------------------------------------------------------Dated this the 15^th day of January, 2024

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O R D E R

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The 2^nd accused in C.C.No.125 of 2014 on the files

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of the Chief Judicial Magistrate, Ernakulam is the petitioner. The learned Magistrate framed charges against the petitioner and also the 1^st accused in the case on 26.09.2022. The correctness, legality and propriety of the proceedings of framing charge are challenged in this revision petition filed under Section 397 read with Section 401 of the Code of Criminal Procedure, 1973 (Code).

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The 3^rd respondent herein is the 1^st accused.

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Service of notice on the 3^rd respondent is dispensed with.

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Heard the learned counsel for the petitioner, the

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learned Public Prosecutor and the learned counsel for the 2^nd respondent.

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Crl.R.P.No.766 of 2022

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The offences alleged in the final report are punishable under Section 120B, 405 and 420 read with Section 34 of the Indian Penal Code, 1860 (IPC). The following is the charge framed against the petitioner as also the 3^rd respondent:

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“That you, A2, the Branch Manager of the company “Haier Appliances India (P) Ltd.” and A1, Sri. Tarun Kambo, the Authorised Representative of the said company, conspired together to cheat CW1 namely Nadeer and in pursuance of the conspiracy, a Dealership-cum-Distribution Agreement was entered into between the company and CW1 on 10.03.2008 for distribution of Home Appliances and you, A2, appointed CW1 as the Authorised Distributor of the items for the Districts of Kozhikode, Malappuram and Wayanad and thereafter failed to attend service complaints of the damaged appliances, causing CW1 to sustain loss of Rs.22,500/- in the business and also you, the 2^nd accused appointed new distributors in violation of the dealershipcum-distribution agreement and without the knowledge of CW1 to destroy the business of the firm of CW1. Further, you, the accused persons presented the Master Cheque given by CW1 at the time of signing the agreement in the bank without giving any prior notice to the complainant and caused the same to bounce and then filed a criminal case against CW1 and thereby cheated CW1 and failed to pay an amount of Rs.57,591/- which was due to CW1 in the

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business transaction. Thus you have committed the offences of criminal conspiracy, criminal breach of trust and cheating punishable u/Ss. 120B, 405 & 420 r/w. S. 34 IPC and within my cognizance.”

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The learned counsel for the petitioner would submit that the disputes are with respect to the business transaction covered by the dealership-cum-distribution agreement dated 10.03.2008 entered into between the respondent Nos.2 and 3 and the same is a civil dispute. Since money was due in the said dealership transaction, the master cheque issued by the 2^nd respondent was presented by the company in terms of the aforesaid agreement and the petitioner is only a branch manager of the company, and cannot be held responsible. The cheque was presented following the disputes that arose between the parties to the contract and by no stretch of imagination, such an act can be termed as a consequence of the fraudulent incitement by the petitioner, or the 3^rd respondent had at the time of execution of the agreement

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dated 10.03.2003. Thus, it is contended that the allegations in the final report or the materials produced therewith would constitute the offences under Section 405 or 420 of the IPC. Similarly, the allegation that the petitioner and the 3^rd respondent hatched a conspiracy for executing the agreement dated 10.03.2008 is quite improbable and incorrect. The further contention is that the accused being a company, Haier Appliances (India) Pvt.Ltd., provisions of Section 305 of the Code should have been complied with. From the allegations in the final report itself, it is evident that the 2^nd respondent filed the complaint as a counter blast to the case initiated by the company following dishonour of the cheque issued by him. It is urged that the court below without considering any of the said aspects proceeded to frame charges against the petitioner, who is only a Branch Manager and therefore the charge is liable to be set aside and the petitioner discharged of the offences.

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Crl.R.P.No.766 of 2022

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The learned counsel for the 2^nd respondent, on the other hand, would submit that while a huge amount is due to the 2^nd respondent in relation to the services rendered by it and without satisfying the terms of the contract in the matter of repairing and replacing the defective products supplied in terms of the dealership agreement dated 10.03.2008, the company had presented the blank cheque obtained from him. The acts of the company, responsibility of which can be attributed only to the petitioner and the 3^rd respondent, amounted to breach of trust and cheating. It is contended that the materials produced by the prosecution are sufficient to make out a case against the petitioner as well as the 3^rd respondent. It is also submitted that the court below, after taking into consideration the materials on record, decided to frame the charge. Therefore, it is contended, this Court in the exercise of the powers under Section 401 of the Code, is not expected to interfere with the

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Crl.R.P.No.766 of 2022

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order of the court below. The learned counsel for the 2^nd respondent placed reliance in the above regard on Munna Devi v. State of Rajasthan and another [(2001) 9 SCC 631]; Ashis Chadha v. Asha Kumari and another [(2012) 1 SCC 680] and State of Gujrat v. Afroz Mohammed Hasanfatta [(2019) 2 SCC 539] .

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As per the dealership-cum-distribution

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agreement dated 10.03.2008 the 2^nd respondent was appointed as a dealer of the company, Haier Appliances (India) Pvt.Ltd., the 3^rd respondent. The 2^nd respondent was appointed thereby as the dealer in the districts, Kozhikode, Wayanad and Malappuram. The petitioner was the branch manager of the company for that area. The allegation is that the petitioner failed to render service, which he was obliged as per the agreement and therefore, the 2^nd respondent had to meet the demands of the customers and in that respect he incurred an

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amount of Rs.22,500/-. Further, the petitioner in connivance with the 3^rd respondent appointed another dealership and distribution agent in the same area in total disregard to the terms of agreement dated 10.03.2008. The master cheque obtained from the 2^nd respondent was allegedly misused and presented in the bank. On dishonouring of the said cheque, a complaint was filed against the 2^nd respondent for his prosecution. An amount of Rs.57,591/- is said to be due to the 2^nd respondent from the said company. The aforesaid acts were allegedly committed in consequence of the criminal conspiracy hatched between the petitioner and the 3^rd respondent.

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Prima facie , it may appear that the matter in issue having emanated from the violation of the terms of the agreement dated 10.03.2008, it is only a civil dispute. It is true that, if at the time of execution of the said agreement, the petitioner and the 3^rd respondent intended to act in accordance with the agreement, but on

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account of the subsequent developments, the contract was broken and resulted in the failure of delivering goods and rendering services, that cannot be an offence of cheating, but only a reason for civil action for breach of contract. But, from the materials produced by the prosecution, that alone is not the fault on the part of the petitioner and the 3^rd respondent.

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The cheque said to have been entrusted with the company at the time of execution of the dealershipcum-distribution agreement on 10.03.2008 was converted to a cheque and presented it in the bank. From the complaint and statements of the de facto complainant and also witness No.2 the misdeeds committed by the 1^st petitioner and the 3^rd respondent are that they failed to pay the service charges and provided the products in replacement of the defective ones. A new distributorcum-dealer was appointed in the areas allotted to the de facto complainant. The prosecution materials further

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make out the allegation that while amounts were due to the de facto complainant, the cheque obtained from it was converted to a negotiable instrument and presented in the bank. The truth or falsity of the said assertions cannot be decided at this stage. What is permissible now is to decide only whether or not the materials produced by the prosecution, would make out a prima facie case against the indictees.

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From the materials produced by the prosecution in this case, it is revealed that appointment of a new dealer and presentation of the master cheque while amounts were claimed due to the 2^nd respondent from the petitioner and his company, and that create a great suspicion that they have committed the offences of criminal breach of trust and cheating. The trial court, after considering the materials, took the view that a charge for the aforesaid offences was liable to be framed against the petitioner. As held in Munna Devi and Ashis Chadha (supra) the trial court cannot

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conduct roving and fishing inquiry into the evidence at the stage of framing charge. It has only to consider whether evidence collected by the prosecution discloses prima facie case against the accused or not. In Afroz Mohammed (supra) the Apex Court held that when the trial court was satisfied that there were sufficient grounds for proceedings, the High Court was not justified in examining the merits and demerits of the case and substitute its own view.

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In the light of the aforesaid principles of law, this Court cannot interfere with the view taken by the court below in the exercise of the powers of revision unless the same is perverse. I find no reason to hold the order framing the charge perverse, or even wrong. This revision deserves only to be dismissed. Accordingly, this revision petition is dismissed.

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Sd/- P.G. AJITHKUMAR, JUDGE

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dkr

Haeir Appliances (India) Pvt. Ltd. (* Corrected as 'Haier' Per Order Dtd 26-10-23 in CRL.MA1/23) v. State of Kerala

Case brief

What is this about?

What the court decided

Haeir Appliances (India) Pvt. Ltd. (* Corrected as 'Haier' Per Order Dtd 26-10-23 in CRL.MA1/23) v. State of Kerala

Case brief

What is this about?

What the court decided

A compact analysis

Issues for consideration

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