IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE N.K.BALAKRISHNAN WEDNESDAY, THE 14TH DECEMBER 2011 / 23RD AGRAHAYANA 1933 Crl.MC.No. 1460 of 2010(B) ------------------------- CC.639/2008 of JUDL. MAGISTRATE OF FIRST CLASS COURT-II, TRIVANDRUM .................... PETITIONER(S): ACCUSED ---------------------- 1. M/S.EMKAY TRADERS, ONION AND POTATO MERCHANT, 730, MARKET YARD, 730 MARKET YARD, GULTEKDI, PUNE, PIN-411 037, REPRESENTED BY ITS MANAGING PARTNER SAMAD. 2. SAMAD, MG. PARTNER, M/S.EMKAY TRADERS, ONION AND POTATO MERCHANT, 730, MARKET YARD, 730 MARKET YARD, GULTEKDI, PUNE, PIN-411 037. 3. MUJEEB, M/S.EMKAY TRADERS, ONION AND POTATO MERCHANT, 730, MARKET YARD, 730 MARKET YARD, GULTEKDI, PUNE, PIN-411 037. 4. AJEESH, M/S.EMKAY TRADERS, ONION AND POTATO MERCHANT, 730, MARKET YARD, 730 MARKET YARD, GULTEKDI, PUNE, PIN-411 037. BY ADVS. SRI.R.O.MUHAMED SHEMEEM SMT.NASEEHA BEEGUM P.S. RESPONDENT(S): COMPLAINANT -------------------------- 1. MR.R.S.K.MANIKANDAN, AGED 36 YEARS, PROPRIETOR, M/S.ARUNACHALAM STORE, CHALAI, THIRUVANANTHAPURAM. 2. STATE OF KERALA, REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA. R1 BY SRI.P.VIJAYA BHANU, SENIOR ADVOCATE ADV. SRI.D.KISHORE R2 BY PUBLIC PROSECUTOR SMT.JASMIN THIS CRIMINAL MISC. CASE HAVING BEEN FINALLY HEARD ON 14/12/2011, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: Crl.MC.No. 1460 of 2010(B) APPENDIX PETITIONERS ANNEXURES 1: PRIVATE CRIMINAL COMPLAINT NO.2366/2008 PENDING BEFORE THE JUDICIAL 1ST CLASS MAGISTRATE COURT AT PUNE 2: COPY OF THE PLAINT IN OS NO:1249 OF 2008 BEFORE THE SUB COURT, THIRUVANANTHAPURAM 3: WRITTEN STATEMENT DATED 6.10.2009 IN OS NO:1249 OF 2008 BEFORE THE SUB COURT, THIRUVANANTHAPURAM 4: CERTIFIED COPY OF THE COMPLAINT, CC 639 OF 2008 PENDING BEFORE THE JUDICIAL 1ST CLASS MAGISTRATE COURT(II), THIRUVANANTHAPURAM RESPONDENTS ANNEXURES NIL //TRUE COPY// P.A.TO JUDGE JJJ N.K. BALAKRISHNAN, J. ------------------------------------------ Crl. M.C. No: 1460 OF 2010 (B) ------------------------------------------ Dated this the 14th day of December, 2011 O R D E R Petitioners are the accused in C.C. No:639/2008 of Judicial First Class Magistrate Court-II, Thiruvananthapuram. A private complaint was filed by R1 against the petitioners alleging offences under section 406, 506(2) and 120(B) r/w 34 IPC. The Court below took cognizance. It is under challenge in this case. 2. The 1st respondent was having business transactions with the 1st petitioner (hereinafter referred to as petitioner). According to the petitioner about Rs.53,00,000/- was due from the 1st respondent towards price of the articles supplied to the 1st respondent. 3. According to the complainant/R1 all transactions were settled up to 2005. It is not disputed that amount was due from him to the petitioner. It was contended that cheque no.234517 dated 31.10.2007 drawn on ICICI Bank, Crl. M.C. No: 1460 OF 2010 (B) -2- Thiruvananthapuram for Rs.5,00,000/-, was issued to the petitioner. On presentment it was bounced due to insufficiency of funds. On receipt of the notice, the amount due under that cheque was stated to have been paid by account transfer. 4. According to the complainant, the accused had told him that the cheque was already sent back. But he did not receive the same. The fact that the cheque was not returned by the petitioner is not disputed but the case of the petitioner is that huge amount is still due from the complainant and it was for presenting the cheque again for the next installment, the cheque was retained. After the sum of Rs.5,00,000/- was received by the petitioner, the said cheque should not have been retained by the petitioner. Thus according to the complainant, there is an unlawful retention of the cheque which is in breach of trust and the petitioner has cheated the complainant also. I find Crl. M.C. No: 1460 OF 2010 (B) -3- no merit in that contention. The amounts were still due from the 1st respondent. The fact that an amount of Rs.5,00,000/-, covered by the cheque, was encashed/received by the petitioner is no reason to say that the petitioner has committed cheating or criminal breach of trust. 5. It is pointed out by the learned counsel for the complainant that based on the cheque which was bounced, a complaint was filed under section 138 of Negotiable Instrument Act. In view of the admission made by the petitioner that amount due thereunder was paid by 'account transfer' and that it was encashed/received by the petitioner, how an offence under section 138 of N.I. Act would lie, is a matter to be considered by that Court. It is pointed out that the 1st respondent had filed a suit before Sub Court, Thiruvananthapuram as O.S. No.1249/2008 for settlement of accounts. That will show that there was no proper settlement of account so as to fix the total amount Crl. M.C. No: 1460 OF 2010 (B) -4- payable by one party to the other. 6. The learned counsel for the complainant would submit that the letter received from ICICI Bank would show that the purpose of remittance was against the dishonor of cheque no.234517 dated 5.11.2007. As said earlier that may be a good defence for the 1st respondent to challenge the complaint filed against him under section 138 of N.I. Act. 7. The decision in STATE OF MAHARASHTRA V. SAYED MOHAMMED MASOOD AND ANOTHER 2009 (8) SCC 787 has been relied upon by the learned counsel for the petitioner to fortify his submission that a simple breach of contract or a case involving pure civil dispute would not attract the penal provisions contained in Section 406 or 420 thereof. 8. The decision in INDIAN OIL CORPORATION V. NEPC INDIA LTD reported in 2006 (6) SCC 736 has also been relied upon by the learned counsel where it was Crl. M.C. No: 1460 OF 2010 (B) -5- held: "However, there is a growing tendency in business circles to convert purely civil disputes into criminal cases. This is obviously on account of a prevalent impression that civil law remedies are time consuming and do not adequately protect the interests of lenders/creditors. Such a tendency is seen in several family disputes also, leading to irretrievable breakdown of marriages/families. There is also an impression that if a person could somehow be entangled in a criminal prosecution, there is a likelihood of imminent settlement. Any effort to settle civil disputes and criminal prosecution should be deprecated and discouraged." 9. It is also argued by the learned counsel that civil breach of trust may not result in criminal breach of trust unless there is evidence to show any act of fraudulent misappropriation. Here, the 1st respondent has already filed a suit for settlement of account. It is true, the petitioner also could have resorted to the remedy through the civil court itself. What ever that be, I find force in the submission made by the learned counsel for the petitioners that ingredients of cheating or criminal breach of trust are Crl. M.C. No: 1460 OF 2010 (B) -6- not attracted in this case. 10. It was argued with vehemence by the learned counsel for the complainant that the petitioners can advance their contention after pre-charge evidence is recorded by the Court below and that the contention now raised can very well be advanced for an order of discharge. But in view of the facts and circumstances of this case, I find that further proceedings in C.C.No.638/2008 would be an abuse of process of court. Hence this petition is allowed. Further proceedings in C.C. No:638/2008 of Judicial First Class Magistrate Court-II, Thiruvananthapuram will stand quashed. N.K. BALAKRISHNAN, JUDGE jjj