CRM M 23322 of 2008 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH -.- CRM M 23322 of 2008 Date of decision : 16.02.2011 Piara Singh .......Petitioner Versus State of Haryana and another ......Respondents Coram: Hon'ble Ms Justice Nirmaljit Kaur Present : Dr. Surya Parkash, Advocate for the petitioner Mr. S S Goripuria, DAG, Haryana for respondent No. 1 Mr. Ashwani Verma, Advocate for respondent no. 2 -.- 1. Whether Reporters of local papers may be allowed to see the judgment? 2. To be referred to the Reporters or not? 3. Whether the judgment should be reported in the Digest? Nirmaljit Kaur, J. This is a petition under Section 482 Cr.P.C praying for quashing of the impugned FIR No.528 dated 02.11.2004, under Section 420, 406, 34 of Indian Penal Code, registered at P S Ratia, District Fatehabad (P3) by respondent No. 2 and all the subsequent proceedings including the final report under Section 173 Cr.P.C dated 28.08.2005 as well as the impugned charge order/charge dated 30.01.2008 (P5) arising therefrom. Learned counsel for the petitioner while praying for quashing CRM M 23322 of 2008 2 of the FIR submitted that respondent no. 2 has already filed a civil suit on 27.09.2004, alleging therein that the petitioner entered into an agreement to sell qua his land on 31.05.2002 and as per the agreement to sell, in case, the petitioner fails to execute the registered sale deed in favour of respondent no. 2 on the fixed dated i.e. 30.05.2003, the petitioner shall be liable to pay twice the amount of the earnest money and respondent No. 2 shall also be entitled at his option to get the sale deed executed through the process of the court and, in case, respondent no. 2 fails to perform his part of the contract, the earnest money shall be forfeited by the respondent. Thus, on the basis of aforesaid agreement to sell, respondent no. 2 also filed a civil suit for specific performance in the court of civil judge at Fatehabad, wherein, he also prayed for declaration that the sale deed No. 2396 dated 14.09.2004 registered in favour of Jasbir Kaur be set aside. It was accordingly stated that the dispute is civil dispute, for which, civil suit has already been filed. As such, criminal offence is not made out. Learned counsel for respondent/complainant vehemently opposed the same and stated that the petitioner instead of executing sale deed in favour of the respondent/complainant, executed the same in favour one Jasbir Kaur wife of Bhagwant Singh. As such, the petitioner has committed a fraud. It is also stated by the learned counsel for the respondent/complainant that the charges have since been framed against the accused/petitioner and therefore, FIR should not be quashed. Heard. No written statement has been filed. As such, it is an admitted position that complainant/respondent CRM M 23322 of 2008 3 no. 2 in the civil suit before the civil Court has alleged that in case, sale deed is not executed, the complainant/plaintiff was entitled to get back the double of the amount of the earnest money and that the complainant/plaintiff shall also be entitled at his option to get the same executed through the process of the civil Court and also that in case, the complainant/plaintiff refuses to perform his part, the earnest money paid to the petitioner shall be forfeited. Moreover, in the civil suit no allegations of cheating or criminal breach of trust has been levelled. On the other hand, the allegations in the FIR are also the same i.e. the petitioner executed an agreement to sell the land mentioned in the FIR, to the complainant/respondent No. 2 for a sale consideration of Rs.1,25,000/- on 31.05.2002 for which Rs.80,000/- was allegedly paid to the petitioner by complainant/respondent No. 2. The date for execution of the registered sale deed was fixed as 31.05.2003 and it was further alleged that on the promised date, the petitioner did not reach the office of the Sub Registrar and complainant/respondent no. 2 got his presence marked before the Sub Registrar. Although, the petitioner in the written statement before the civil court has denied any such agreement, the argument of the learned counsel for complainant/ respondent no.2 that the petitioner had sold the land to one Jasbir Kaur wife of Bhagwant Singh does not help as admittedly as per the FIR, the date for execution of the sale deed with the respondent/ complainant was fixed 31.05.2003, whereas, the sale deed in the name of one Jasbir kaur wife of Bhawant Singh is alleged to be of 14.09.2004 i.e. after almost one year and three months from the date when the execution of CRM M 23322 of 2008 4 sale deed was fixed with respondent. Thus, intention to cheat is not made out from the allegations in the FIR. Hon'ble the Supreme Court in the case of Ram Biraji Devi and another v. Umesh Kumar Singh and another reported as (2006) 6 Supreme Court Cases 669 in some what similar circumstances observed:- “11. There cannot be any disagreement to the well settled proposition of law that the High Court should exercise its inherent powers in extreme exceptions to quash an FIR or a complaint. The ration as laid down in Trisus Chemical Industry case is of no help and assistance of the complainant in the facts and circumstances of the present case. The complaint instituted does not disclose that an offence under Section 420 is made out. Cognizance taken by the Magistrate thereon again the appellants for offences under Sections 406, 419, 420 and 120-B IPC is clearly an abuse of the process of Court and interference by this Court is expedient in the interest of justice. This is a case of extreme exception where the High Court ought to have exercise its inherent jurisdiction and power to set aside the unwarranted and unjustified order of the magistrate impugned before it by the appellants.” Similar view was held in the case of Murari Lal Gupta v. Gopi Singh reported as (2005)13 Supreme Court Cases 699 in para 6 as under:- “6. We have perused the pleadings of the parties, the complaint and the orders of the learned magistrate and the Sessions Judge. Having taken into consideration all the material made available on record by the parties and after hearing the learned counsel for the parties, we are satisfied that the criminal proceedings initiated by CRM M 23322 of 2008 5 the respondent against the petitioner are wholly unwarranted. The complaint is an abuse of the process of the court and the proceedings are, therefore, liable to be quashed. Even, if all the averments made in the complaint are taken to be correct, yet the case for prosecution under Section 420 or Section 406 of the Penal Code is not made out. The complainant does not make any averment so as to infer any fraudulent or dishonest inducement having been made by the petitioner pursuant to which the respondent parted with the money. It is not the case of the respondent that the petitioner does not have the property or that the petitioner was not competent to enter into an agreement to sell or could not have transferred title in the property to the respondent. Merely because an agreement to sell was entered into which agreement the petitioner failed to honour, it cannot be said that the petitioner has cheated the respondent. No case for prosecution under Section 420 or Section 406 IPC is made out even prima facie. The complaint filed by the respondent and that to at Madhepura against the petitioner, who is a resident of Delhi, seems to be an attempt to pressurize the petitioner for coming to terms with the respondent.” Hon'ble the Apex Court in the case of Suresh v. Mahadevappa Shiappa Danannava and Anr. reported as 2005 AIR (SC) 1047, quashed the complaint case, wherein, the allegations of cheating was made by the complainant against the petitioner on the ground that the accused had executed an agreement to sell her house but subsequently backed out. The Apex Court held that it is a dispute of civil nature and there was no allegation that the accused had fraudulent or dishonest intention at the time of making the promise. CRM M 23322 of 2008 6 Even in the case of B Suresh Yadav v. Sharifa Bee and another reported as (2007) 13 Supreme Court Cases 107, the Apex Court went on to hold that the power of the High Court for quashing of the criminal can be exercised where a civil suit is also pending between the parties in respect of the same subject matter and the criminal proceedings in such like cases amounting to abuse of process of law. Applying the test laid down in all the above said cases for the purpose of establishing an offence of cheating, complainant is required to show that the accused had fraudulent or dishonest intention. In the present case, the sale deed was not registered in pursuance to the agreement to sell between the parties. Civil suit for specific performance has already been filed. There is no allegations in the civil suit that there was any fraudulent and dishonest intention on the part of the petitioner. If at all, it is a case of breach of contract which does not amount to cheating. This Court in the case of Arun Kumar and another v. State of Punjab and another reported as 2006(3) RCR (Criminal) 793, in some what similar circumstances quashed the proceedings by relying on the judgment of the Apex Court rendered in her case of H R Verma v. State of Bihar, reported as AIR 2000 SC 2341, by holding that:- “6. From the simple reading of the allegations made in the FIR, it is apparent that it was a case of breach of contract, which may not give rise to an offence of cheating. Dishonouring of commitment and avoiding of contract would give rise to civil liability. In H R Verma v. State of Bihar, AIR 2000 SC 2341, Hon'ble CRM M 23322 of 2008 7 the Supreme Court, while dealing with a similar question held:- “In determining the question it has to be kept in mind that the distinction between mere breach of contract and the offence of cheating is a fine one. It depends upon the intention of the accused at the time of inducement which may be judged by his subsequent conduct but for this subsequent conduct is not the sole test. Mere breach of contract cannot give rise to criminal prosecution for cheating unless fraudulent or dishonest intention is shown right at the beginning of the transaction, that is the time when the offence is said to have been committed. Therefore, it is the intention which is the gist of the offence. To hold a person guilty of cheating it is necessary to show that he had fraudulent or dishonest intention at the time of making the promise. From his mere failure to keep up promise subsequently such a culpable intention right at the beginning, that is, when he made the promise cannot be presumed.” In the present case, complainant/respondent No. 2 has already filed a civil suit for specific performance. In the civil suit filed by the complainant, no such allegation of dishonesty has been referred to. The allegation in the FIR that petitioner sold the land to some one else and therefore, he has committed fraud has no merit as the same was sold after waiting for almost one year and three months from the date when the sale deed was to be executed with the complaint. For almost one year and three months, neither the complainant filed any civil suit nor any criminal case against the present petitioner. Thereafter, the petitioner got registered the CRM M 23322 of 2008 8 sale deed of the land in question in the name of one Jasbir Kaur wife of Bhagwant Singh after the expiry of about one year and three months of the final date of execution of the agreement to sell with respondent as he could not wait any further. As such, no fraudulent or dishonest intention can be read into the same. If at all, it amounts to breach of contract and does not make out a criminal offence under Section 420 IPC. Thus, the registration of the FIR against the present petitioner is nothing but an abuse of process of law. In view of the aforesaid discussion, the present petition is allowed and FIR No. 528 dated 02.11.2004, under Section 420, 406, 34 of Indian Penal Code, registered at P S Ratia, District Fatehabad (P3) and all the subsequent proceedings, including the final report under Section 173 Cr.P.C dated 28.08.2005 as well as the impugned charge order/charge dated 30.01.2008 (P5) arising out of the same are hereby quashed. Allowed in the above terms. (Nirmaljit Kaur) Judge 16.02.2011 mohan