Crl. Misc. No.M-10434 of 2010 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. Crl. Misc. No.M-10434 of 2010 Date of Decision: 28.03.2011 Rajeev Datta, Proprietor Dutta Sports, Shimla ....Petitioner Versus Balwant Brothers Pvt. Ltd. & anr. ...Respondents CORAM : Hon'ble Ms. Justice Nirmaljit Kaur Present:- Mr. J.S. Dhaliwal, Advocate for the petitioner. None for the respondent. ***** 1. Whether Reporters of Local Newspapers 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 for quashing of criminal complaint titled as M/s Balwant Brothers Pvt. Ltd. vs. Rajeev Dutta under Sections 406/420/506 IPC having No.148 dated 20.12.2006 pending in the Court of Judicial Magistrate Ist Class, Jalandhar and all the proceedings thereunder. The complaint has been filed by the respondent against the present petitioner with the allegations that the respondent supplied some sports goods to the petitioner and raised a Bill no.769 dated 01.01.2002 for ` 14,029/-. It is further alleged that despite alleged promise to make the payment, it has not been released to the respondent by the petitioner. The goods were taken with intention to mis-appropriate and same have been mis-appropriated and the petitioner intentionally failed to discharge liablility Crl. Misc. No.M-10434 of 2010 2 and has threatened the respondent and as such, has committed an offence under Sections 406, 420 and 506 IPC. The facts, in short, are that the petitioner placed an order to the agent of respondent-Firm at Shimla. The goods were delivered at Shimla by Transport Company, who were handed over a Bank Draft in token of payment of delivered goods. It was not encashed by respondents. On request of respondent and the Transport Company, it was revalidated. Learned counsel for the petitioner while praying for quashing of the complaint submitted that the amount was paid through Demand Draft. The said Demand Draft was not encahsed. As such, the complaint is mala fide and misuse of process of law. It was alleged that the complainant is in the habit of blackmailing people by filing the complaints. It was one of his modus operandi to refuse the payment and file complaint which he withdrew after taking double the payment. It is further contended that the dispute is of civil in nature and as such, the criminal complaint is not maintainable. It is further stated that the allegations are vague as no time, date or place has been mentioned as to who extended the threat and in what manner and at what point of time. It is further contended that no offence under Section 406 IPC is made out from the facts stated in the FIR. Heard. The respondents were duly served. However, no one appeared on behalf of the respondents, despite service. When no one appeared, proceedings before the trial Court were stayed in the hope that someone would appear on behalf of the respondents. However, the matter was adjourned twice thereafter, but still, no one has put in appearance on behalf of the respondents. Today also, no one is present. A perusal of the complaint shows that the only allegation is that the petitioner has not made the payment towards the Bill No.769 dated Crl. Misc. No.M-10434 of 2010 3 01.01.2002 amounting to ` 14,029/-, whereas, it is the specific stand of the petitioner which is not denied that the petitioner had made the payment to the respondent vide Demand Draft No.554228 dated 03.01.2003. It was subsequently revalidated on 24.09.2004. Even otherwise, the question that is to be determined in the present case is as to whether Section 420 IPC is made out or not. The same depends on the intention of the accused at the time of inducement. 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. Hon'ble the Supreme Court in the case of Veer Parkash Sharma vs. Anil Kumar Agarwal and another reported as 2007(3) RCR (Criminal) 960, in somewhat similar circumstances, wherein, the allegation was that the accused had purchased goods but did not make the payment despite repeated demands, the Court held that the same was primarily a civil dispute by determining the same as under :- “8. The dispute between the parties herein is essentially a civil dispute. Non payment or under payment of the price of the goods by itself does not amount to commission of an offence of cheating or criminal breach of trust. No offence, having regard to the definition of criminal breach of trust contained in Section 405 of the Indian Penal Code can be said to have been made out in the instant case. Section 405 of the Indian Penal Code reads, thus ; “Whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied, which he has Crl. Misc. No.M-10434 of 2010 4 made touching the discharge of such trust, or willfully suffers any other person so to do, commits “criminal breach of trust”. Neither any allegation has been made to show existence of the ingredients of the aforementioned provision nor any statement in that behalf has been made.” While doing so, reliance is placed on the judgment rendered in the case titled as Hridaya Ranjan Verma and other vs. State of Bihar and another reported as 2000(4) SCC 168, wherein, it is held as under :- “14. On a reading of the section it is manifest that in the definition there are set forth two separate classes of acts which the person deceived may be induced to do. In the first place he may be induced fraudulently or dishonestly to deliver any property to any person. The second class of acts set forth in the section is the doing or omitting to do anything which the person deceived would not do or omit to do if he were not so deceived. In the first class of cases the inducing must be fraudulent or dishonest. In the second class of acts, the inducing must be intentional but not fraudulent or dishonest. 15. 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 Crl. Misc. No.M-10434 of 2010 5 made the promise cannot be presumed.” Similar view was also held in the case of Hon'ble the Supreme Court in the case titled as Harmanpreet Singh Ahluwalia and others vs. State of Punjab and others reported as 2009(2) RCR(Criminal) 956. The petitioner had made the payment vide demand draft which was intentionally not encashed. The complainant has not come forward to dispute the specific stand of the petitioner. There is no reason why the petitioner will not want to make the payment of a small amount of ` 14,029/- and instead go through litigation which is likely to incur more expenditure than the total amount in dispute. Moreover, as per the ratio of judgment rendered in the case of Veer Parkash Sharma and Harmanpreet Singh Ahluwalia and others (supra) as above non payment or under-payment of the price of the goods by itself does not amount to criminal offence. Thus, the parameters of interference with criminal proceedings by the High Court are well settled. If on the face of it, no offence is disclosed, the High Court may interfere and quash the proceedings. In the facts of the present case, as discussed above, the guilty intention which is an essential ingredient of offence of cheating is not made out, the conduct of the petitioner shows that there was no intention on his part to cheat. In view of the above, the present petition is allowed and criminal complaint titled as M/s Balwant Brothers Pvt. Ltd. vs. Rajeev Dutta under Sections 406/420/506 IPC having No.148 dated 20.12.2006 pending in the Court of Judicial Magistrate Ist Class, Jalandhar and all the proceedings thereunder, are hereby, quashed. (NIRMALJIT KAUR) 28.03.2011 JUDGE gurpreet