The Court allowed a criminal petition under Section 482 Cr.P.C. seeking quashment of proceedings for offences under Sections 406 and 420 IPC arising from non-payment of a bid amount in an auction, holding it a pure contractual dispute.
All proceedings against the petitioner in Crime No.207 of 2011 at 4th Town Police Station, Vijayawada, are quashed.
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SMT JUSTICE T. RAJANI CRIMINAL PETITION No.10896 of 2011
ORDER:
This criminal petition is filed under Section 482 Cr.P.C. seeking to quash the proceedings against the petitioner in Crime No.207 of 2011 on the file of 4th Town Police Station, Vijayawada, Krishna District, registered for the offences punishable under Sections 406 and 420 of IPC.
“ The petitioner herein is said to be a contractor, who has participated in the bid of Madduru Sand Reach, when the auction was held on 14.06.2011 for a sum of Rs.9,00,00,000/- (Rupees nine crores only). He has
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deposited 1/4 th of the bid amount. But, somehow, he did not pay the balance amount and, therefore, the Assistant Director of Mines and Geology, Vijayawada has lodged a complaint, which was registered as a case in F.I.R. No.208 of 2011 for the offences under Sections 406 and 420 of the Indian Penal Code, 1860 (for short “IPC”).
Evidently, the terms of the auction are covered by the conditions of auction and in case of default as per the conditions under clause-9, the Department has got right to forfeit the amount. Either under G.O.Ms.No.84 dated 10.04.2007 or under the conditions of auction, there is no criminal liability attached to the failure of the petitioner to deposit the balance amount. If once default is committed, naturally the amount, which was already deposited, can be forfeited to the State. Therefore, in view of the above circumstances, it is a case of pure contractual obligations and not a case involving any criminal liability, more so any offence either under Section 420 or 406 of IPC. Therefore, in view of the above circumstances, the proceedings are quashed since there is nothing on record to show that by any term the accused could be prosecuted in a criminal Court for breach of the terms of the contract. The right to take legal action is quite different from the right to proceed with criminally.”
As a sequel, miscellaneous petitions pending
consideration, if any, shall stand closed.
______________ T. RAJANI, J
01.11.2018 SS
1 issue framed by the court
Whether criminal proceedings for breach of auction terms and non-payment of balance amount should be quashed as they are purely contractual.
Colour shows how this judgement treated each authority
Crl.P.No.5714 of 2011, dated 20.09.2011Followed¶6
3 provisions across 2 enactments
The State
T. RAJANI
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
