Pravakar Samanta Vs State of Odisha

By mea n s of this application, the Petitioner s e eks to quash the order the o rder dated 04.01.2021 passed by the learned S.D.J.M., Bhub a neswar in C.T. No.4259 of 2019 a n d judgment dated 19.03.202 1 passed by the learned Addl. Session s Judge-cumSpecial Judge, CBI-II, Bhubaneswar in Criminal Revi s ion No.22 of 2021.

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In the af o resaid order and judgment, the learne d court below declined to relea s e the sum of Rs.30,00,000/- deposite d in the form of Standby Letter of Credit (SBLC) with the banker o f the accused Opposite Party i . e. State Bank of India, Commercial B ank, IDCOL House, Ashok N agar, Bhubaneswar as against the security for

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awarding proposed dealership of retail outlet for Indizel and products purpor t ed to have been seized in connect i on with the investigation of t he case in CID Crime Branch P.S. Case No.78 of 2019.

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The fac t ual backdrop of the case, in brief , is that the Petitioner, havi n g come across an advertisement published in the Odia daily newspaper “The Sambad” dated 06.10.20 1 7, contacted the authorised s ignatory of M/s. My Own Eco En e rgy Private Limited , Pune, w hich claimed to be a manufacturer a n d distributor of Indizel (bio-d i esel), a renewable diesel product. Pur s uant thereto, one Soumya R a njan Mishra, representing the accus e d company, entered into an agreement dated 01.12.2017 with the Petitioner/Infor m ant through one Tapas Kumar Sahoo f or grant of a retail outlet for I n dizel and allied products at Ankul, Ja j pur, in terms of the business plan. In furtherance of the said agreement, the Petitioner paid a sum of Rs.30,00,000/- (Rupees Thirt y Lakhs only) in the form of a Letter of Credit through the State B a nk of India, Commercial Br a nch, IDCOL House, Ashok Nagar, B hubaneswar, and also deposit e d a refundable security amount of Rs.15,00,000/(Rupees Fifteen L akhs only) in five instalments in the b ank account of the accused company. It is stated that after t h e aforesaid payments were m ade, one Priyabarta Nanda, Junior Head of the accused compa n y, developed the site and undertook certain civil construction wo r ks. However, despite repeated request s and followup by the Petitio n er with Soumya Ranjan Mishra and T apas Kumar Sahoo, the aut h orised representatives of the accused company declined to su p ply the equipment in terms of th e agreement, subsequently cl o sed their office at Bhubaneswar, a nd failed to

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respond to the Petitioner’s requests for refund of the amounts received towar d s the proposed dealership. Accor d ing to the Petitioner, Clause-7 of the agreement contemplated furnishing of a bank guarantee t o secure the dues of the company to w ards supply of equipment a n d products. However, it later transpired that the accused compa n y had allegedly adopted fraudulent p ractices and cheated not onl y the Petitioner but several other e ntrepreneurs across different p arts of the State of Odisha, collecti n g substantial sums of money. The Petitioner further claims to hav e ascertained that the Managing Director of the accused comp a ny and his associates were arrested by the Hyderabad Central C rime Station Police in connec t ion with FIR No. 78 of 2019 dated 1 0 .04.2019 for offences of chea t ing. It is further alleged that the accu s ed company had indulged in similar fraudulent activities and was a ttempting to encash or tran s fer the Standby Letter of Credit (SBLC) of Rs.30,00,000/- t o unknown concerns. Apprehending such action, the Petitioner ap p roached this Court by filing W.P.(C) N o. 16019 of 2019 seeking a d irection to the State Bank of India, Commercial Branch, IDCOL House, Bhubaneswar, not to disbur s e, encash or permit transfer o f the SBLC in favour of the accused company or any third party, a nd also sought initiation of investig a tion into the alleged fraudul e nt activities of the company. Co n sidering the gravity of the a l legations, this Court, by order date d 12.09.2019, disposed of the w rit petition with the following directi o ns:-

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“Regard being heard to the facts and submis s ions, the petit i oner is directed to lodge an F.I.R in the compete n t police station or crime branch whic h ever is autho r ized to take charge of the investig a tion,

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within t w o weeks from today. If such an F. I .R is lodged, i m mediate follow up action shall be ta k en by the com p etent police station and withdrawal o f the stand by l etter of credit guarantee by the Opp. P arty (Compan y ) shall be checked in accordance wit h law.

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Till one month from today, the Opp. Party N o. 4 (SBI C o mmercial Branch) is directed n o t to encashm e nt or transfer to any other part y the standby l e tter of guarantee given by the petitio n er in favour o f the Opp.Party No. 3 (Company).

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With the a foresaid observation, the Writ Appli c ation is dispos e d of.”

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Pursuant to the directions issued by this Cou r t in W.P.(C) No. 16019 of 2 0 19 by order dated 21.09.2019, the C I D registered CID P.S. Case N o. 11 of 2019 at the instance of t h e Petitioner against Tapas K umar Sahoo, Soumya Ranjan Mishr a , Priyabrata Nanda and othe r officials/authorised persons of M/s. M y Own Eco Energy Pvt. Ltd. In connection with the said case, the investigating agency seized th e sum of Rs.30,00,000/- deposited in t he form of a Letter of Credit w ith the State Bank of India, Comme r cial Branch, IDCO House, B h ubaneswar, and the Petitioner was d u ly intimated by the Bank regarding such seizure. The Petitioner a s serts that he was in urgent need of funds for the admission of his s o n to school, having invested h is entire savings in the aforesaid busi n ess venture, and having sub s equently discovered that the accus e d firm had practised fraud b y failing to supply bio-diesel as a d vertised and agreed upon. A c cordingly, he approached the learn e d S.D.J.M., Bhubaneswar se e king release of the Letter of Credit u nder Section 457 Cr.P.C. H o wever, upon hearing the parties, the learned

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Magistrate decl i ned to release the said amount, holding the application to be not maintainable.

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Aggrieved thereby, the Petitioner preferr e d Criminal Revision No. 50 of 2021 before the learned Ses s ions Judge, Bhubaneswar, w hich, upon transfer, was renumbered as Criminal Revision No. 22 of 2021 and heard by the learned A d dl. Sessions Judge-cum-Spec i al Judge, CBI-II, Bhubaneswar. T h e revisional court, by judg m ent dated 19.03.2021, dismissed the revision petition. Being d issatisfied with the aforesaid orders p assed by the courts below, th e Petitioner has invoked the inherent j u risdiction of this Court by fi l ing the present application seeking r e lease of the said amount.

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Mr. Cha d ha, learned counsel for the Petition e r, during the course of hearin g , inter alia, drew the attention of this Court to the manner in whic h M/s. My Own Eco Energy Private Li m ited floated advertisements inviting applications for grant of retailership, pursuant to whi c h the Petitioner deposited a sum of Rs.30,00,000/in the form of a L etter of Credit, in addition to a refun d able security deposit of Rs.1 5 ,00,000/- remitted through NEFT/R T GS in five instalments to th e bank account of the accused compan y .

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Learned c ounsel further submitted that despite execution of the agreement dated 01.12.2017 between the parties, the accused company failed to supply the products in terms th e reof. It was contended that t h e accused company had practised fr a ud not only upon the Petitioner but also upon several other si m ilarly placed persons, and tha t it had no intention either to award r e tailership or to supply Indizel bio-products. According to learned counsel, the

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amount deposit e d by the Petitioner under the Stan d by Letter of Credit remains u nutilised and its continued retentio n is seriously prejudicial to th e interests of the Petitioner, particularl y when there is no possibility o f the business being carried forward i n view of the alleged fraudule n t conduct of the accused company, against whom multiple FIRs ha v e also been registered.

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It was f u rther submitted that the directions i s sued by this Court in W.P.( C ) No. 16019 of 2019 were challe n ged by the accused compa n y before the Hon’ble Supreme Cou r t in Special Leave to Appea l (C) No.7380-7381 of 2022, wherei n the grounds opposing the Pe t itioner’s claim for release of the afor e said amount were urged; ho w ever, the Hon’ble Supreme Court declined to accept such cont e ntions.

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Per con t ra, Mr. Patnaik, learned counsel a ppearing on behalf of Opposite Party No.2- M/s. My Own Eco E n ergy Private Limited , vehem e ntly opposed the submissions adva n ced by Mr. Chadha, learned counsel for the Petitioner. He contend e d, inter alia, that the present a pplication is not maintainable in its p resent form, inasmuch as the dispute arises out of the terms of the agreement, which provides for resolution through arbitration, a nd that the Petitioner is at liberty to invoke such remedy or see k appropriate relief before t h e competent forum. Learned co u nsel further submitted that t h e allegations of fraud levelled by the P etitioner are wholly unfound e d and premature. It was argued that t he Petitioner is not entitled to seek release of the amount in question on allegations of fr aud during the pendency of the i nvestigation. According to le a rned counsel, the impugned order passed by the

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learned trial cou r t is in consonance with law and doe s not warrant any interference b y this Court.

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Admitte d ly, the Petitioner had approached bot h the learned Magistrate and t he Revisional Court seeking release o f the seized amount lying w i th the State Bank of India, Comme r cial Branch, pursuant to the d eposit made in terms of the agreemen t entered into between the Petitioner and the accused firm. From a p erusal of the record, and as is undisputed from the submissions ad v anced by the respective partie s , it is evident that the accused firm h a d floated an advertisement in the Odia daily newspaper “The Sam b ad” inviting applications for grant of retail outlets for its product, namely biodiesel. Induced b y the said advertisement, the Petition e r applied for a retail outlet i n the name and style of M/s. Shree D urga Filling Station under J ajpur Tahasil, deposited an applic a tion fee of Rs.2,00,000/-, a n d further paid a sum of Rs.1,00,0 0 0/- towards consideration of his application. An agreement betwe e n the parties was thereafter e xecuted on 01.12.2017. In terms of the said agreement, the Petitioner deposited an interest-fre e refundable security amount of Rs.15,00,000/- in five instalments a nd furnished a sum of Rs.30, 0 0,000/- in the form of a Standby Le t ter of Credit (SBLC) in acco r dance with Clause-7 of the agreeme n t. However, the accused fir m neither awarded the retailership nor refunded the amounts deposited by the Petitioner despite repeate d requests. It further transpire d that the office of the accused fir m located at Signature Tower, Pahala, was subsequently closed, an d no effective communication f rom the accused firm was forthcomi n g, rendering it impossible for the Petitioner to pursue the proposed r e tailership.

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Being u n der the apprehension that the accused firm was attempting to encash or transfer the SBLC amount of Rs.30,00,000/- t o unknown entities, the Petitioner ap p roached this Court by filing a writ petition. By virtue of the inter i m directions issued therein, s u ch attempt was stalled, as a result o f which the amount of Rs.30,00,000/- deposited by the Petitioner i n the form of an SBLC with t h e State Bank of India, Commercial B r anch, IDCO House, Ashok N agar, Bhubaneswar remained frozen . Pursuant to the directions of this Court to lodge an FIR, the Petitio n er submitted a complaint, wh i ch was registered as CID Crime Bra n ch P.S. Case No. 11 of 2019.

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The afor e said action of the Petitioner was chal l enged by the accused firm be fo re the Hon’ble Supreme Court in Special Leave to Appeal (C) N o s. 7380-7381 of 2022; however, the Hon’ble Supreme Court d eclined to entertain the said petition s , taking note of the fact that s e veral FIRs had been registered against the accused firm, and grante d liberty to the Petitioner to proceed i n accordance with law in the pending criminal case, as follows:

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“ Since i n pursuance of the order of High C ourt dated 12.09.2019, an F.I.R. has been registere d and the inves t igation is in progress, coupled with the fact that similar F.I.Rs. have been registered in other states as well on similar allegations, we do not deem it nece s sary to exercise our discreti o nary jurisdicti o n under Article 136 of the Constitut i on of India ”

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Consequ e ntly, during the course of investig a tion in CID Crime Branch P.S. Case No. 11 of 2019, the sum of Rs.30,00,000/lying with the S tate Bank of India, Commercial B r anch, IDCO

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House, Ashok Nagar, Bhubaneswar was seized by the I.O., as duly intimated to the P etitioner by his banker.

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It is th e case of the Petitioner that the amount of Rs.30,00,000/- w as furnished solely as security to e n sure supply under the proposed retailership. However, since no suc h supply was ever made, and in view of the fact that, as per the terms of the agreement, the commencement thereof was cont i ngent upon commissioning of the dealership, the SBLC furni s hed by the Petitioner has n o operative consequence in the co n text of the contractual relationship between the parties.

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In this regard, Clause-5(i) of the agreem e nt assumes relevance and re a ds as follows:-

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“ Effectiv e Date and Term: This Agreement shall become ef fective from the date of commission i ng of the deal e rship (First Supply) and shall rem a in in force for an initial period of seven years and shall be rene w ed for the same period thereaft e r in accorda n ce with the terms of this Agreement .”

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In the m a tter of Usha Chakraborty & another vs. State of West Bengal and another reported in (2023) 15 SCC 135 , the Hon’ble Suprem e Court held as follows:-

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“8. In P a ramjeet Batra v. State of Uttarakh a nd, this Court he l d: (SCC p. 676, para 12) “12. W hile exercising its jurisdiction under Section 482 o f the Code the High Court has to be c autious. This p o wer is to be used sparingly and onl y for the purpose of preventing abuse of the proces s of any court o r otherwise to secure ends of justice. W hether a co m plaint discloses a criminal offence or not depen d s upon the nature of the facts alleged therein. Whether essential ingredients of criminal off e nce are

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presen t or not has to be judged by the High C ourt. A compl a int disclosing civil transactions m a y also have a criminal texture. But the High Court m ust see wheth e r a dispute which is essentially of a civil nature is given a cloak of criminal offence. I n such a situati o n, if a civil remedy is available and is , in fact, adopte d as has happened in this case, the Hi g h Court should not hesitate to quash the criminal pro c eedings to pre v ent abuse of process of the court.”

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×××

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In Kapil Aggarwal v. Sanjay Sharma, th i s Court held tha t Section 482 is designed to achi e ve the purpose o f ensuring that criminal proceedings are not permitte d to generate into weapons of harassment.

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In th e decision in State of Haryana v. Bhaj a n Lal, a two-Judge Bench of this Court considered the s tatutory provisio n s as also the earlier decisions and held as under: (SCC pp. 378-79, para 102)

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“102.... (1) Where the allegations made in t he first infor m ation report or the complaint, even if t hey are taken at their face value and accepted i n their entiret y do not prima facie constitute any of f ence or make o ut a case against the accused. (2) W h ere the allegations in the first inf o rmation report and other materials, if any, accompan y ing the FIR d o not disclose a cognizable offence, j u stifying an in v estigation by police officers under Section 156(1) of the Code except under an order of a Magis t rate within the purview of Section 1 5 5(2) of the Co d e.

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(3) W h ere the uncontroverted allegations m ade in the FI R or complaint and the evidence coll e cted in suppo r t of the same do not disclose the co m mission of an y offence and make out a case against the accuse d .

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(4) W here the allegations in the FIR do not constit u te a cognizable offence but constitut e only a non-c o gnizable offence, no investigation is permit t ed by a police officer without an or d er of a

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Magis t rate as contemplated under Section 1 5 5(2) of the Co d e.

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(5) W here the allegations made in the FIR or compl a int are so absurd and inherently im p robable on the basis of which no prudent person c an ever reach a just conclusion that there is sufficien t ground for pr o ceeding against the accused.

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(6) W h ere there is an express legal bar eng r afted in any o f the provisions of the Code or t he Act concer n ed (under which a criminal proce e ding is institu t ed) to the institution and continuanc e of the procee d ings and/or where there is a specific provis i on in the Code or the concern e d Act, provid i ng efficacious redress for the grievan c e of the aggrie v ed party.

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(7) W here a criminal proceeding is m a nifestly attend e d with mala fide and/or where the pr o ceeding is mal i ciously instituted with an ulterior m o tive for wreaking vengeance on the accused and wit h a view to spit e him due to private and personal grud g e.

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×××

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As n oticed hereinbefore, the respondent alleged commiss i on of offences under Sections 323, 3 8 4, 406, 423, 46 7 , 468, 420 and 120-B IPC aga i nst the appellant s . A bare perusal of the said allegation and the ingredie n ts to attract them, as adverted to here i nbefore would reveal that the allegations are vague a nd they did not c a rry the essential ingredients to const i tute the alleged o ffences. There is absolutely no allegation in the complaint that the appellants herein had caused hurt on the r e spondent so also, they did not revea l a case that the a ppellants had intentionally put the res p ondent in fear o f injury either to himself or another or by putting h im under such fear or injury, dis h onestly induced him to deliver any property or v aluable security. The same is the position with respe c t to the alleged o ffences punishable under Sections 4 0 6. 423. 467, 46 8 , 420 and 120-B IPC. The ingred i ents to attract th e alleged offence referred to hereinbe f ore and the nat u re of the allegations contained in the

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applicati o n filed by the respondent would und o ubtedly make it c lear that the respondent had failed t o make specific allegation against the appellants h e rein in respect o f the aforesaid offences.

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The factual position thus would reveal t hat the genesis as also the purpose of criminal procee d ings are nothing b ut the aforesaid incident and further that the dispute i nvolved is essentially of civil nat u re. The appellant s b and the respondents have given a c loak of criminal offence in the issue. In such circu m stance when th e respondent had already resorted to the available civil remedy and it is pending, goin g by the decision in Paramjeet Batra, the High Cour t would have qu a shed the criminal proceedings to pre v ent the abuse o f the process of the Court but for the conceal m ent.

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In t h e aforesaid circumstances, coupled w ith the fact that in respect of the issue involved, whi c h is of civil nat u re, the respondent had already approa c hed the jurisdicti o nal civil court by instituting a civil s u it and it is pendi n g, there can be no doubt with respe c t to the fact that t he attempt on the part of the respond e nt is to use the c r iminal proceedings as weapon of harassment against t h e appellants. The indisputable facts that the responde n t has filed the pending title suit in t he year 2015, he got no case that he obtained an interi m relief against h i s removal from the office of Secreta r y of the School M anaging Committee as also the tru s teeship, that he f iled the stated application for an o r der for investiga t ion only in April 2017 together with absence of a case that despite such removal he got a rig h t to get informed of the affairs of the school and also t h e trust, would o n ly support the said conclusion. 23. For a l l these reasons, we are of the conside r ed view that this case invites invocation of the pow e r under Section 4 82 CrPC to quash the FIR registered b ased on the direc t ion of the Magistrate Court in the af o restated applicati o n and all further proceeding in p u rsuance thereof. Also, we have no hesitation to h o ld that permittin g continuance of the criminal pro c eedings

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against t h e appellants in the aforesaid circu m stances would re s ult in abuse of the process of court a nd also in miscar r iage of justice.”

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Though this Court is not called upon to examine the sustainability of the criminal proceedings, it cannot b e lost sight of that the underlyi n g transaction is contractual in nature. As observed by the Hon’ble Supreme Court in the above decis i on, criminal process ought n ot to be permitted to operate as a coercive mechanism in e s sentially civil disputes. Continued retention of the petitioner’s dep o sit, despite non-commencement of the contract, would amount to such misuse.

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It is an a d mitted position between the parties t h at there was no commencem e nt or commissioning of the dealershi p pursuant to the advertiseme n t floated by the accused firm, notwit h standing the amount deposite d by the Petitioner with the Bank. Th e said amount was admittedly deposited with the sole intention of securing the proposed retaile r ship, which, in fact, was never awarded to the Petitioner by the accused firm. Consequently, the amo u nt lying with the Bank has re m ained unutilised and continues to do so, serving no purpose except remaining under seizure for t h e sake of investigation.

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In such circumstances, the mere retention of the said amount with the Bank, in the absence of any materia l prima facie indicating that t h e accused firm has any lien or subsisting right over the same, woul d result in its continued stagnation to the clear detriment of the Petitioner’s interest. In the consider e d opinion of this Court, and i n the best interest of the matter in dispute, it is

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therefore necess a ry that the said amount be released in favour of the Petitioner on an interim basis. The Petitioner shall ta k e custody of the amount and m ay utilise the same for his purposes, s ubject to the condition that, i n the event the amount becomes the s u bject matter of any adjudicat i on between the parties, the same sha l l be restored as and when directed by any competent court.

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The amo u nt of Rs.30,00,000/- deposited by the Petitioner in the form of a St a ndby Letter of Credit with the State B ank of India, Commercial Bra n ch, IDCO House, Bhubaneswar shall be released in favour of th e Petitioner on an interim basis, s u bject to the conditions indic a ted hereinabove. The Petitioner sha l l furnish an undertaking bef o re the learned court below to abide b y any further directions that m ay be issued by the court concerned w ith regard to the said amount.

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It is ma d e clear that the observations herein, are confined solely to the di s posal of the present application and shall not be construed as an e xpression of opinion on the merits o f the criminal case pending in v estigation, which shall proceed ind e pendently in accordance with law.

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(Chittaranjan Dash) Judge

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Bijay

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Signature Not Verified

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Digitally Signed Signed by: BIJAY KETAN SAHOO Reason: Authentication Location: HIGH COURT OF ORI SSA Date: 30-Jan-2026 14:57:12

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Pravakar Samanta v. State of Odisha

Case brief

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Pravakar Samanta v. State of Odisha

Case brief

What is this about?

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