Dismissed

Virender Kumar Sethi v. Manish Kumar Dawar and Anr.

Punjab & Haryana HC3 Sept 2009CRM-M/8390/2009

Case brief

AI extract

What is this about?

Petitioner challenged the dismissal of his private complaint alleging cheating and forgery against partners of a firm. The High Court held the allegations regarding fund transfers and material shifting were merely monetary disputes between partners and maintained the dismissal.

What did the court decide?

Petition for quashing of lower courts' orders dismissing private complaint was dismissed.

Virender Kumar Sethi Vs Manish Kumar Dawar and… — Property and Title | Punjab & Haryana HC (2009)

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Crl. Misc. No. M-8390 of 2009

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IN THE HIGH COURT OF PUNJAB & HARYANA AT CHANDIGARH

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*** * * * *** Crl. Misc. No. M-8390 of 2009 Date of decision : September 25, 2009

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Virender Kumar Sethi

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............Petitioner

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Versus

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Manish Kumar Dawar and another

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...........Respondents

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CORAM: HON'BLE MR. JUSTICE JORA SINGH

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Present: Mr. Ashish Aggarwal, Advocate for the petitioner.

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JORA SINGH, J.

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Virender Kumar Sethi filed this petition under Section 482 Cr.P.C for setting aside the order dated 31.10.2008 (Annexure P-8) passed by the learned Additional Sessions Judge, Karnal and order dated 18.1.2008 (Annexure P-6) passed by the Chief Judicial Magistrate, Karnal vide which the private complaint under Sections 420, 467, 468, 471, 506 and 120-B IPC (Annexure P-1) was dismissed.

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Virender Kumar Sethi, petitioner filed private complaint on the allegation that respondents had induced him to start a

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Crl. Misc. No. M-8390 of 2009

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partnership firm with them. They started carrying on business in the name and style of M/s Maa Bhagwati Krishi Udyog for manufacturing and trading of all kinds of agricultural implements. Respondent no.2 promised to provide premises to carry on the business. Respondent no.1 was the major investor, whereas the petitioner was to invest in the new venture as per availability of the funds with him. Parties agreed to share the profit and loss equally. Accounts of the firm were to be operated by the parties jointly. Petitioner used to tour all over the country to promote the sale of the firm whereas respondent no.2 was looking after the manufacturing process. Respondents in connivance with each other illegally transferred the raw material of M/s Maa Bhagwati Krishi Udyog to the premises of the firm of respondent no.2 i.e M/s Punjab Agro Sales. Respondents further transferred the money fraudulently from the accounts of M/s Maa Bhagwati Krishi Udyog to the accounts of M/s Punjab Agro Sales by making forged investments. Machinery of the firm was also fraudulently sold to M/s Punjab Agro Sales by forging the vouchers. Respondent no.1 from June 2004 to October 2004 remained employee with a call centre at Delhi and in his absence, respondent no.2 had forged the record in the name of respondent no.1. Ultimately private complaint was instituted.

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Preliminary evidence was led but the complaint was dismissed vide order dated 18.1.2008 on the allegation that no prima facie case is made out to summon the respondents under any Section of the IPC. Against order dated 18.1.2008, revision was preferred but the same was dismissed vide impugned judgment

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Crl. Misc. No. M-8390 of 2009

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dated 31.10.2008 by Additional Sessions Judge, karnal.

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Learned counsel for the petitioner argued that parties had entered into a partnership deed. Business was to be carried on under the name and style of M/s Maa Bhagwati Krishi Udyog. Site of business was to be provided by respondent no.2. Respondent no.1 was to carry on the business of the firm and he was the major investor, whereas the petitioner was deputed to tour all over the country to promote the sale of the firm. In the absence of the petitioner, respondents by forging vouchers transferred the material of M/s Maa Bhagwati Krishi Udyog to the premises of M/s Punjab Agro Sales. Payment lying deposited in the accounts of M/s Maa Bhagwati Krishi Udyog was illegally transferred to the accounts of M/s Punjab Agro Sales but trial Court did not appreciate the legal and factual position. Complaint was dismissed on the allegation that dispute is of civil nature. Approach of the trial Court is not correct one because material of the firm and payment lying in the accounts of M/s Maa Bhagwati Krishi Udyog was wrongly transferred in the accounts of M/s Punjab Agro Sales owned by respondent no.2.

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I have gone through the file. But submission of the learned counsel for the petitioner seems to be not reasonable one. No ground to interfere with the impugned judgment. Evidence on the file shows that parties had entered into partnership deed. As per allegation of the petitioner, material lying in the premises of M/s Maa Bhagwati Krishi Udyog was transferred to the premises of M/s Punjab Agro Sales by forging vouchers. Payment lying deposited in the accounts of the M/s Maa Bhagwati Krishi Udyog was also

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transferred in the accounts of M/s Punjab Agro Sales. Evidence further shows that there was a dispute amongst the parties regarding maintenance of accounts. As per the petitioner, respondents had forged the accounts but the dispute amongst the parties is of civil nature. In case accounts of the firm were not being maintained properly then petitioner should have filed civil suit for rendition of accounts. If the respondents in connivance with each other had disposed of the material of the firm M/s Maa Bhagwati Krishi Udyog then remedy with the petitioner was to move for dissolution of the firm and file civil suit for rendition of accounts. Mark A is the partnership deed. All the partners were to share the loss/profit in equal share. Evidence shows that M/s Maa Bhagwati Krishi Udyog filed different complaints under Section 138 of the Negotiable Instruments Act i.e CWA/A2 CW-8. All these complaints were instituted on behalf M/s Maa Bhagwati Krishi Udyog by respondent no.2 That means respondent no.2 was authorized to file complaints on behalf of firm and to effect compromise. As per allegation of the petitioner, when there was a dispute amongst the parties, then Panchayat was convened but when no compromise was arrived at then private complaint was instituted. Convening of Panchayat falsifies the contention of the petitioner to opine that respondents had bad intention to deceive the petitioner from the very beginning. After entering into partnership deed, respondent no.1 had the power to receive payments in the shape of cheques, drafts etc. When respondent no.1 had the power to receive payments, then if payment was transferred in the accounts of firm owned by respondent no.2

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then both the Courts below rightly opined that no prima facie case is made out to summon the respondents under any Section of the IPC. If respondent no.1 had signed as a proprietor then no offence was committed if the drafts were cleared by the Bank because respondent no.1 was a partner of the firm. Secondly, he was deputed to carry on the business of the firm. No document on the file that accounts of the firm cannot be operated single handedly. No case of the petitioner that his signature was forged on any document. Simple allegation of the petitioner is that respondents no. 1 and 2 had siphoned the funds of M/s Maa Bhagwati Krishi Udyog to the accounts of M/s Punjab Agro Sales.

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Relevant para no.5 of the judgment dated 18.1.2008 passed by Chief Judicial Magistrate, Karnal is reproduced as under:

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“5. From the perusal of records, it is observed that the complainant had entered into a partnership firm with the accused. Allegedly, the accused did not adhere to the terms and conditions between the parties for running the firm. There was a dispute between the parties regarding the accounts. There were several other litigation pending between the parties. According to the complainant the accused have forged the accounts in order to siphon off money from their firm M/s Maa Bhagwati Krishi Udyog to the firm of accused No.2 M/s Punjab Agro Sales. The complainant has relied upon the testimony of the various bank officials to

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Crl. Misc. No. M-8390 of 2009

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substantiate his claim. The testimony of these witnesses only show that there is monetary dispute between the parties and clearly this dispute is of a civil nature and does not constitute any criminal liability, at this stage. Therefore, no ground is made out for summoning any of the accused for cheating the complainant, at this stage and the complaint is accordingly dismissed. File be consigned.”

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Relevant paras no. 8, 9 and 10 of the judgement dated 31.10.2008 passed by Additional Sessions Judge, Karnal is reproduced as under:

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“8. In this case the allegations of the complainant against the accused mainly are that the bank draft as well as cheques which are mentioned above in detail were received in the name of M/s Maa Bhagwati Krishi Udyog for payment but the amount of these cheques and draft was got credited in the account of M/s Punjab Agro Sales belonging to accused No.2. It is also argued that the payments mentioned in these cheques, drafts and other payments were made on the basis of signature of accused No.1 as proprietor of the firm and not as a partner. In fact account of the firm

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was joint and was to be operated with the signatures of complainant and accused No.1 jointly. These payments were got made on the basis of the

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signatures of accused No.1 alone. After close perusal of the entire evidence on the file it is clear that complainant and accused No.1 were partners of the firm M/s Maa Bhagwati Krishi Udyog. Each and every act done by a partner on behalf of the firm is binding upon all partners of the firm. Complainant himself admitted that he used to live in other States most of the time to increase sale of the firm and accused No.1 used to receive payments of the firm in the shape of cheques, drafts etc. If there was joint account and legally the account can be operated with the signatures of both the partners, I feel in such a situation the Manger of the Bank concerned should not have allowed payment of these cheques and drafts etc. There is also allegation that raw material of the firm M/s Maa Bhagwati Krishi Udyog was shifted to the firm M/s Punjab Agro Sales belonging to accused No.1 and the sale of the finished goods on the basis of this raw material was shown as sold to M/s Maa Bhagwati Krishi Udyog.

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9. During the course of arguments, it is also pointed out that few complaints were filed on behalf of M/s Maa Bhagwati Krishi Udyog like Ex.CW8/A to Ex. CW8 under Section 138 of the Negotiable Instruments Act. Few documents

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concerned with these complaints under Section 138 of the Negotiable Instruments Act have been placed on the file. It is told that accused No.2 got settlement in those complaint cases also. I found the above mentioned complaints under Section 138 of the Negotiable Instruments Act are shown to have been filed on behalf of the firm by Munish Kumar Dawar accused No.2. It appears that Munish Kumar Dawar was authorised to file those complaints being partner of the firm. If the complainant was competent to file those criminal complaints certainly he was competent to arrive at a settlement also in those complaint cases.

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10. The learned trial Court has dismissed the complaint filed by the complainant mentioning that in fact it is a monitory dispute between the partners of the firm and this dispute is of civil nature and does not constitute any criminal liability. There is allegation in the complaint that regarding this controversy a panchayat was also convened but settlement could not be possible. To me also the controversy between the partners appears to be purely of civil nature. It appears to be monitory dispute between two partners of the firm. Complainant himself admits that accused No.1 used to receive payments in the shape of drafts and

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cheques etc., because complainant used to live in other States. These circumstances clearly indicate that accused was given liberty to receive the payments and to get deposited in the accounts of the firm. It will also be pertinent to mention here that as per settlement premises belonging to accused No.2 was also being used for the business of M/s Maa Bhagwati Krishi Udyog. In my view when there was monitory dispute between the partners the settlement could not be possible in a panchayat proper course for the complainant was to get the dispute settled through arbitrator keeping in mind the terms and conditions in the partnership deed. The complainant also can avail remedy regarding rendition of accounts by filing a civil suit if he is advised to do so. Version of the complainant is also that the panchayat was convened by him but accused did not agree for rendition of accounts. Merely because accused No.1 signed the drafts which was on a printed performa mentioning as proprietor it cannot be held that accused No.1 has committed an offence. If account can be operated with the joint signatures of the complainant and accused No.1, I feel in this situation the bank officials should not have allowed clearance of the drafts merely on the basis of the signature of

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accused No.1. Any how if any such payment has been made that has been cleared on the basis of signature of a partner of the firm and not on the basis of the signature of a stranger. If there is any monitory dispute between the parties it can be considered as a civil liability and does not constitute any criminal liability. It will be pertinent to mention here that as per facts of this case none of the accused forged signatures of the complainant or any other person. The cheques and bank drafts received as payment to M/s Maa Bhagwati Krishi Udyog were sent for payment to the bank concerned with signatures of accused No.1 who was joint holder of the bank account. It appears that the bank concerned had taken liberal a view at the time of making of the payment. I feel these days this tendency is increasing day by day to initiate criminal proceedings in those cases also which are purely civil nature to put opponent party under stress and pressure and to dictate terms by the complainant.”

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Learned CJM and first revisional Court after perusing the evidence on file rightly came to the conclusion that dispute amongst the parties is of civil nature. In case all concurrent findings by the CJM and the Additional Sessions Judge, Karnal, I am of the opinion that there is no question to re-evaluate and reassess the evidence on

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file.

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In the light of above discussion, no ground is made out to interfere with the impugned order dated 31.10.2008 (Annexure P-8) passed by the learned Additional Sessions Judge, Karnal and order dated 18.1.2008 (Annexure P-6) passed by the Chief Judicial Magistrate, Karnal.

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Present petition is accordingly dismissed.

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September 25, 2009 ( JORA SINGH ) ritu JUDGE

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Crl. Misc. No. M-8390 of 2009 :12:

Virender Kumar Sethi v. Manish Kumar Dawar and Anr.

Case brief

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Virender Kumar Sethi v. Manish Kumar Dawar and Anr.

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