CRM No. M 27045 of 2009 and connected petitions 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH -- Date of decision: 30.03.2010 1. CRM No. M 27045 of 2009 Tarsem Chand Jain ........ Petitioner Versus State of Haryana .......Respondent(s) 2. CRM No. M 26780 of 2009 Tarsem Chand Jain ........ Petitioner Versus State of Haryana ...Respondent 3. CRM No. M 26782 of 2009 Tarsem Chand Jain ........ Petitioner Versus State of Haryana ...Respondent Coram: Hon'ble Ms Justice Nirmaljit Kaur -.- Present: Mr. K S Sidhu, Senior Advocate with Mr. Sourabh Goel, Advocate for the petitioner Mr. K C Gupta, Sr. DAG, Haryana for the respondent State Mr. Anand Chhibbar, Advocate for the complainant -.- 1. Whether Reporters of local papers may be allowed to see the judgement? CRM No. M 27045 of 2009 and connected petitions 2 2. To be referred to the Reporter or not? 3. Whether the judgement should be reported in the Digest? Nirmaljit Kaur, J. This common order shall dispose of all the aforementioned petitions arising out of the same FIR involving the same parties. CRM M No. 27045 of 2009 The facts and circumstances leading to the filing of this petition are summarised hereunder:- That complainant Smt. Manu Goyal along with Smt. Uma Singla and Aman Singla were partners of M/s Aar Jay Steels, Baddi (H.P). Vide deed dated 09.09.2009, Smt. Manu Goyal and Smt. Uma Singla retired from the firm and the petitioner's joined the partnership firm. Similarly, vide deed dated 10.09.2007, Aman Singla also retired leaving the partnership firm with two partners namely the petitioner herein. The stipulations contained in these deeds were reiterated and further elucidated vide deeds dated 15.12.2007 and 17.12.2007. It is specifically mentioned in these deeds that the retirement of existing partners was for valuable consideration passed on to them vide cheque No. 599047 and 599048 respectively dated 01.03.2008 and 01.09.2008 in the sum of Rs.20,00,000/- and Rs.1,06,20,500/- favouring Smt. Manu Goyal; Cheque No. 281277 and 281278 dated 01.03.2008 and 01.09.2008 respectively in favour of Smt. Uma Singla; and cheque No. 281279 dated 01.09.2009 in the sum of Rs.63,10,200/- in favour of Aman Singla. However, cheque No. 281278 dated 01.09.2008 in the sum of CRM No. M 27045 of 2009 and connected petitions 3 Rs.43,10,3000/- in favour of Smt. Uma Singla and cheque No. 599048 dated 01.09.2008 in the sum of Rs.1,06,20,500/- in favour of Smt. Manu Goyal as also cheque No. 281279 dated 01.09.2008 in the sum of Rs.63,10,200/- in favour of Aman Singla were dishonoured. Consequently the holder of these cheques (erstwhile partners) filed separate petitions under Section 138 of Negotiable Instrument Act. During the pendency of the complaint under Section 138 of Negotiable Instruments Act, Smt. Manu Goyal, filed FIR No. 401 of 02.09.2009 in the Police Station, Sector 5, Panchkula, against the petitioner under Section 420, 467, 468, 471, 120-B of Indian Penal Code. This petition has been filed under Section 482 Cr.P.C. for quashing of aforesaid FIR. Learned counsel for the petitioner while seeking quashing of the FIR, inter alia, contended; a) that the subject matter of the dispute including the land and building sold to the petitioner by the complainant, is situated in the State of Himachal Pradesh and agreement/reconstitution deed has also been executed in the State of Himachal Pradesh at Baddi. No part of the cause of action whatsoever arose for the territorial jurisdiction of the District of Panchkula and therefore Panchkula Police had absolutely no jurisdiction to lodge the FIR in respect of the said act/omission. b) that the FIR has been lodged essentially in respect of the dishonourment of cheques bearing Nos. 281278 and CRM No. M 27045 of 2009 and connected petitions 4 599048 dated 01.09.2008 in respect of which the complainants have already filed the criminal proceedings under Section 138 of the Negotiable Instruments Act. It is fundamental that in respect of the same cause, two parallel proceedings under the criminal law cannot possible be allowed to continue. Since the petitioners are facing trial under Section 138 of the Negotiable Instruments Act, the present proceedings in respect of the same issue are liable to be quashed on this thorough ground itself. c) that the FIR in question has been lodged on the basis of complaint/letter dated 11.08.2009 and the FIR has been lodged on 02.0-9.2009 whereas the incident of alleged inducement/cheating in impersonating the respondents- complainants to enter into the deed of reconstitution of the partnership of the firm took place on 09.09.2007 i.e. it relates back to more than two years ago. While taking up the first argument of the learned counsel for the petitioner that the SHO at Panchkula has no territorial jurisdiction to investigate the crime, reliance has been placed by the learned counsel for the petitioner on the judgement rendered by the Apex Court in the case of Harmanpreet Singh Ahluwalia and others v. State of Punjab and others reported as 2009(2) RCR (Criminal) 956. The said judgement does not help the petitioner in any way. In that case, FIR was quashed by the Hon'ble Supreme Court keeping in view the facts of that case and not on the ground of jurisdiction but inter alia on other grounds and by taking into CRM No. M 27045 of 2009 and connected petitions 5 account the fact that it was not understood as to why the father of the complainant went back to Jalandhar to lodge FIR when the larger part of the offence was committed in Canada and there was no material on the basis of which the charge sheet had been submitted. Hon'ble the Supreme Court in the circumstances of the case came to the conclusion that the allegations contained in the FIR had been made with an ulterior motive just to harass the appellant. Thus, the issue of territorial jurisdiction was not an issue before the Apex Court. Learned counsel for the respondent- complainant, on the other hand, submitted that not only does the complainant reside in the Panchkula but even the petitioner resides in the Panchkula. Thus, the Panchkula Police has the jurisdiction. It was further submitted that even if for the sake of arguments, it is assumed that the Panchkula police has no jurisdiction and jurisdiction is at Chandigarh where the cheques in question were dishonoured or Baddi (Himachal Pradesh) where the property is situated, even then, the FIR cannot be quashed on that ground. Reliance was placed on the judgement of the Apex Court rendered in the case of Satvinder Kaur v. State (Govt. of NCT of Delhi) and another reported as JT 1999(8) SC 25. There is merit in the argument raised by the learned counsel for the respondent complainant. The Apex Court while holding that the High Court had committed an error in entertaining the petition under Section 482 Cr.P.C. and quashing the FIR on the basis of territorial jurisdiction, observed in para 8 of the judgement that:- “8. In our view, the submission made by the learned counsel for the appellant requires to be accepted. The CRM No. M 27045 of 2009 and connected petitions 6 limited question is whether the High Court was justified in quashing the FIR on the ground that Delhi Police Station did not have territorial jurisdiction to investigate the offence. From the discussion made by the learned Judge, it appears that learned Judge has considered the provisions applicable for criminal trial. The High Court arrived at the conclusion by appreciating the allegation made by the parties that the S.H.O., Police Station Paschim Vihar, New Delhi was not having territorial jurisdiction to entertain and investigate the F.I.R. lodged by the appellant because the alleged dowry items were entrusted to the respondent at Patiala and that the alleged cause of action for the offence punishable under Section 498A I.P.C. arose at Patiala. In our view, the findings given by the High Court are, on the face of it, illegal and erroneous because : (1) The S.H.O. has statutory authority under Section 156 of the Criminal Procedure Code to investigate any cognizable case for which an F.I.R. is lodged. (2) At the stage of investigation, there is no question of interference under Section 482 of the Criminal Procedure Code on the ground that the Investigating Officer has no territorial jurisdiction. (3) After investigation is over, if the Investigating Officer arrives at the conclusion that the cause of action for lodging the F.I.R. has not arisen within his territorial jurisdiction, then he is required to submit a report accordingly under Section 170 of the Criminal Procedure Code and to forward the case to the Magistrate empowered to take cognizance of the offence.” After taking into consideration Sections 156, 168, 169 and 170 to chapter XIII of the Criminal Procedure Code which provides for “jurisdiction of the Criminal Courts in inquiries and trials” held that 'if the CRM No. M 27045 of 2009 and connected petitions 7 Investigating Officer arrives at the conclusion that the crime was not committed within the territorial jurisdiction of the police, then FIR can be forwarded to the police station having jurisdiction over the area in which crime is committed. But this would not mean that in a case which requires investigation, the police officer can refuse to record the FIR and/or investigate it.” Thus, in view of the above discussion, there is no merit in the argument of the learned counsel for the petitioner that the SHO at Panchkula has no power to investigate the matter. In case, the SHO comes to the conclusion that the Panchkula police has no jurisdiction, the FIR can be forwarded to the police station having the jurisdiction but the FIR cannot be quashed on this ground on account of territorial jurisdiction. Taking up the second argument that criminal proceedings under Section 138 of the Negotiable Instruments Act are already pending and therefore an FIR on the basis of the same allegations is a misuse of process of law, also has no merit in the facts of the present case. The specific allegations in the FIR read as under:- “5 That as already submitted to above, till the realisation of the cheques for the purchase of the share, the accused person have no right title or interest in the firm M/s Aar Jay Steels and only after the realisation of the purchase money i.e. the cheques, the necessary documents were to be executed in favour of the above accused persons and when they failed to perform their part of contract they are not entitled to claim any right over the property of the firm in any manner CRM No. M 27045 of 2009 and connected petitions 8 whatsoever. 6. That all the accused persons knowingly, intentionally and dishonestly and without informing and without the knowledge and consent of the applicant, took a lona from UCO bank branch Sector 17, Bank Square Chandigarh, and to guarantee the said loan, they also in connivance with each other dishonestly, illegally and fraudulently deposited the original sale deed dated 27.09.2003 belonging to the property of the said firm with the said bank. They also put the false, fake and forged signatures on various documents with the said bank by impersonation, without any lawful authority and consent of the applicant and with the intention to cheat and cause undue loss to the applicant and for unlawful gain for themselves. From the perusal of the above allegations, it is evident that dishonouring of the cheques was one aspect of the criminal offence for which proceedings under Section 138 of the Negotiable Instrument Act have no-doubt been initiated. However, the second offence has been committed subsequently. The cheques were given to the complainants in lieu of their shares in the partnership firm. The cheques were not honoured. Till the realisation of the cheques for the purchase of the share, the petitioner had no right or title in the firm. The necessary documents for the transfer of the share in the firm were yet to be executed. In spite of the petitioner not having any title to the property, they took a loan from the Bank and deposited the original sale deed of the property of the firm with the Bank. CRM No. M 27045 of 2009 and connected petitions 9 Thus, causing double loss to the complainants and cheating the complainants as well as the bank. Reliance has been placed by the learned counsel for the petitioner on the judgement rendered by the Apex Court in the case of G Sagar Suri v. State of U.P reported as 2000(1) RCR (Criminal) 707 and the judgement rendered by this Court in the case of Harinderpal Singh v. State of Punjab reported as 2007 (4) RCR (Criminal) 534 which relied on the judgement of the Apex Court in the case of G Sagar Suri (supra). Both these judgements are not applicable in the facts of the present case. As stated above, the allegations in the FIR are specific and relate to the second aspect of the criminal offence and differ from the offence under Section 138 of the Negotiable Instruments Act. Thus, in the present case, the FIR does not amount to double jeopardy. The last argument of the learned counsel for the petitioner that the FIR was lodged after almost two years of the incident. Under no circumstances the delay can be made a ground to quash the FIR containing specific allegations of cheating and criminal breach of trust etc. Hon'ble the Supreme Court in the case of Eicher Tractor Ltd. and others v Harihar Singh and others (Criminal appeal No. 1755 of 2008 decided on 07.11.2008) in para 8 of the judgement held as under:- 8. As noted above, the powers possessed by the High Court under Section 482 of the Code are very wide and the very plenitude of the power requires great caution in its exercise. Court must be careful to see that its decision in exercise of this power is based on sound principles. The inherent power should not be exercised to stifle a legitimate prosecution. The High Court being the highest CRM No. M 27045 of 2009 and connected petitions 10 court of a State should normally refrain from giving a prima facie decision in a case where the entire facts are incomplete and hazy, more so, when the evidence has not been collected and produced before the Court and the issues involved, whether factual or legal, are of magnitude and cannot be seen in their true perspective without sufficient material. Of course, no hard-and-fast rule can be laid down in regard to cases in which the High Court will exercise its extraordinary jurisdiction of quashing the proceedings at any stage. It would not be proper for the High Court to analyse the case of the complainant in the light of all probabilities in order to determine whether a conviction would be sustainable and on such premises, arrive at a conclusion that the proceedings are to be quashed. It would be erroneous to assess the material before it and conclude that the complaint cannot be proceeded with. In proceedings instituted on complaint, exercise of the inherent powers to quash the proceedings is called for only in a case where the complaint does not disclose any offence or is frivolous, vexatious or oppressive. If the allegations set out in the complaint do not constitute the offence of which cognizance has been taken by the Magistrate, it is open to the High Court to quash the same in exercise of the inherent powers under Section 482 of the Code. It is not, however, necessary that there should be meticulous analysis of the case before the trial to find out whether the case would end in conviction or acquittal. The complaint has to be read as a whole. If it appears that on consideration of the allegations in the light of the statement made on oath of the complainant that the ingredients of the offence or offences are disclosed and there is no material to show that the complaint is mala fide, frivolous or vexatious, in that event there would be CRM No. M 27045 of 2009 and connected petitions 11 no justification for interference by the High Court. When an information is lodged at the police station and an offence is registered, then the mala fides of the informant would be of secondary importance. It is the material collected during the investigation and evidence led in the court which decides the fate of the accused person. The allegations of mala fides against the informant are of no consequence and cannot by itself be the basis for quashing the proceedings.” Admittedly, in the facts of the present case, the High Court in the order dated 23.09.2009 (in CRM M 26780 of 2009) while considering anticipatory bail of the present petitioner had recorded as under:- “Counsel for the petitioner submits that the petitioner is ready and willing to discharge his liability which would come around Rs.1 crore or Rs.1 crore odd to show his bona fides and with the intention to pay back the amount of his liability, he states that the petitioner would deposit Rs.20 lacs within a period of 10 days' from today with the Registrar of this Court by way of bank draft. He further submits that the petitioner would clear all his dues within a period of one year from today, in case the benefit of bail is granted to the petitioner. This deposit of the amount would be without prejudice to the rights of the petitioner or whatever grounds he intends to take before the other Court.....” Thereafter, on 01.03.2009, on the joint request of the counsel for the parties, two Chartered accounts, namely Shri Prem Garg and Shri Mukul Bansal, whose names were agreed and suggested by the parties themselves were requested to go into the assertions, claims and counter claims of the both the parties limiting it to the transaction involved in the CRM No. M 27045 of 2009 and connected petitions 12 FIR. Pursuant to the aforesaid orders, the Chartered Accounts submitted their report in a sealed cover. In the report, it is concluded as under:- “...From the prevailing circumstances and the documents scrutinised by us, we are of the opinion that this transaction of Rs.62.90 lacs appears to be a sham transaction. The petitioners have not furnished any conclusive evidence to directly link this payment of Rs.62.90 lacs as adjustment against the total liability of Rs.252.41 lacs. Therefore, we are unable to consider the payment of Rs.62.90 lacs, detailed above, as deduction against the liability of Rs.252.41 lacs.” This report further concluded that:- “in the absence of any supporting document, the petitioners have not been able to conclusively prove that this amount of Rs.20 lacs was payable by the outgoing partners, therefore, the deduction of this amount from the total liability of Rs.252.41 lacs remains unproved.” Thus, it is an admitted position that the petitioner is liable to pay the above said amount to the respondents. Even if the disputed amount of Rs.62.90 plus Rs.20.00 is deducted from Rs.252.41 for the sake of argument, even then, the liability of the petitioner is Rs.169.51 lacs is admittedly to be paid by the petitioner. The petitioner has neither paid the said amount and on top of it have used the property of the firm to take a loan from the Bank by misrepresentation. In view the discussion made above, there is no merit in the petition (CRM M 27045 of 2009) and discretion under Section 482 Cr.P.C. cannot be exercised in the facts of the present case. Accordingly, the same CRM No. M 27045 of 2009 and connected petitions 13 is dismissed. CRM M 26780 of 2009 This is a petition under section 438 Cr.P.C. for grant of anticipatory bail to the petitioner in the aforesaid FIR. The petitioner was granted interim bail vide the order dated 23.09.2009. The same is already reproduced above. In view of the same, the criminal miscellaneous is allowed and the order dated 23.09.2009 is accordingly made absolute. The said amount of Rs.30.00 lacs already deposited by the petitioner with the Registry of this Court in pursuance to said order shall be released to the respondents. At this stage, learned counsel for the petitioner referred to the judgement rendered by the Apex Court in the case of Sohan Lal Juneja and others v. State of Punjab reported as 2007(3) R.C.R. (Criminal) 959, wherein, the condition imposing to deposit Rs.10,00,000/- for grant of anticipatory bail was set aside and the matter was remanded back for re- consideration. In that case, the reasons were specified by the High Court for imposing the condition. However, the facts in the present are different from Sohan Lal Juneja's case (supra). In the present case, the liability is admitted by the petitioner himself. Statement was made on behalf of the petitioner before this Court which is evident from the order dated 23.09.2009 that the petitioner is ready and willing to discharge the liability. However, pursuant to the aforesaid order, the petitioner had also deposited a sum of Rs.20,00,000/- with the Registrar of this Court. Further, in pursuance to the CRM No. M 27045 of 2009 and connected petitions 14 order dated 13.10.2009 passed in CRM M 26782 of 2009, a sum of Rs.10,00,000/- was further deposited with the Registry of this Court. A concession was made by the learned counsel on behalf of the petitioner that he would clear atleast Rs.1 crores of the liability if bail is granted to him. The two Chartered Accountants appointed on the joint request of the parties by the Court to decide the dispute, have duly given a finding that the petitioner owes respondents an amount of Rs.252.41lacs. Rs.30,00,000/- were accordingly deposited by the petitioner with the Registry of this Court to show his bona fide. Even if the disputed amount of Rs.62.99 lacs plus Rs.20.00 lacs is deducted from Rs.252.41 lacs, even then, the petitioner cannot escape their admitted liability of Rs.169.51 lacs. Accordingly, there is no merit in the objection raised by the learned counsel for the petitioners. Disposed of accordingly. CRM M 26782 of 2009 This is a petition under Section 439 Cr.P.C. for grant of regular bail to the petitioner in the aforesaid FIR. In view of the order granting interim bail, the criminal miscellaneous is allowed and the petitioner shall be released on bail on his furnishing fresh bail bond to the satisfaction of the CJM/Duty Magistrate, Panchkula. Disposed of accordingly. (Nirmaljit Kaur) Judge March 30, 2010 mohan