1 Cri.Appln.No.1873/2010 IN THE HIGH COURT OF JUDICATURE OF BOMBAY BENCH AT AURANGABAD CRIMINAL APPLICATION NO.1873/2010. 1) Vodafone Essar Cellular Ltd. (A company registered under Companies Act, 1956) having its Registered office at – 1045/1046, Avinashi Road. Coimbatore-641 018, and having its present circle office at The Metropolitan Wakdewadi, Survey No.21, Final Plot No.27, Old Pune-Mumbai High way, Pune – 4110. 2) Andrew Davies Age: 44 Yrs., occu. Chief Financial Officer, Vodafone Essar Ltd. Peninsula Corporate Park, Ganpatrao Kadam Marg, Lower Parel, Mumbai-400 013. - APPLICANTS VERSUS 1) The State of Maharashtra, Through Secretary, Home Department, Mantralaya, 2 Cri.Appln.No.1873/2010 Mumbai – 4000 32. 2) Mr.Ravikumar Ghanshyam Korani, Age:26 Yrs., occu. Trader, Proprietor: Raviraj Agency, Wipro Road, Tamboli Gin, Plot No.3/4, Amalner, Tq. Amalner, Dist. Jalgaon. - RESPONDENTS ( Resp.No.2 orig.complainant) ***** Mr.Shirish Gupte, Sr.Counsel with Mr.Subodh Desai, Advocate, h/for Mr.PR Patil, Advocate Applicants; Mr.GR Ingole, APP for State Mr.KC Sant, Advocate for Respondent No.2. ----- CORAM : K.U.CHANDIWAL, J. DATE : 21st June, 2011. JUDGMENT: 1) Heard extensively and finally. Rule made returnable forthwith by consent of parties. 2) The applicants have questioned legality of direction under Section 156(3) Cr.P.C. and consequent registration of FIR bearing No.44/2010 dated 21.2.2010, registered with police station, Amalner. 3 Cri.Appln.No.1873/2010 3) The applicants had business transaction with respondent no.2 as distributor for carrying out business of selling of products of the applicants/company (Prepaid Sim cards) and other allied items, based on agreement of distributorship. As a part of the business transaction in terms of clause 15, payment terms for prepaid cards were ten days credit from the date of invoice and the distributor/respondent no.2 would have to keep minimum 15 signed-blank cheques drawn in favour of applicant-company. It was further clarified that the cheques would be deposited on 10th day of each invoice day. The applicants claim, the respondent no.2, as a distributor, had agreed to these terms and signed the agreement. There were amended agreements between the parties, for which there are virtually no controversies. 4) Since the Pre-paid cards/re-charge vouchers were sent to the distributor and after verifying the delivery of the goods, the cheque for the amount was sent for encashment to the bankers of the distributor from the 15 signed blank cheques. Cheque dated 9.7.2007 bearing No. 0339431 for Rs.1,44,000/- was sent for encashment. Another cheque for Rs.40,000/- was also sent for encashment. Both these cheques 4 Cri.Appln.No.1873/2010 returned on the ground that it exceeded the arrangement, i.e. insufficient funds. Consequent thereupon, by following the procedure in terms of Section 138 of the Negotiable Instruments Act, since the cheques were dishonoured, the applicant/company filed Criminal Case No. 37705/2008 before the learned JMFC, Pune. Respondente No.2 – distributor sought statement of accounts from the applicant company, which was complied with. After service of summons in the said case, and causing appearance, Respondent No. 2 on 17.11.2009 filed RCC No.313/2009 before the learned JMFC, Amalner in terms of seeking investigation under Section 156(3) Cr.P.C. The learned Magistrate was pleased to pass an order to put up the case for verification. There was no verification, the learned Judge passed an order dated 9.2.2010 whereby police station, Amalner was directed to register an offence and investigate the matter to submit a final report under Section 173 or under Section 169 of Cr.P.C. 5) Mr.Gupte, learned Sr. Counsel in the set of above facts, submits that to preempt the action of the applicant/company to recover its legitimate dues of supply of goods, criminal prosecution is launched, which apparently is without substance and the allegations are sweeping in its nature. The gist of the complaint 5 Cri.Appln.No.1873/2010 taken together does not make out a case against the Directors or the Finance In charge, who sits abroad, who is In charge for affairs of the company worldwide. 6) Learned Sr.Counsel informed, it is not a case of misappropriation, nor a case of forgery at the behest of the applicants. He also informs, Section 20 of the Negotiable Instruments Act provides mechanism for the applicants in respect of the cheques and under an authority, the cheques were filled in as the drawer of the cheques delivered blank-signed cheque with an authority to the holder to put the details as per his choice in the light of the accounts. The instrument could not be treated to be a forged document. Accused nos.1 and 2 are not in existence. Accused no.5 is a Managing Director; accused no.6 is world Finance Director whereas accused no.7 is Chief Technical Officer. The procedure, as required under Section 154 of Cr.P.C. is given bye-pass by respondent no.2 and the learned Judge did not venture this legal lacunae. Learned Sr. Counsel repeats, as a liver to avoid prosecution under Section 138 of Negotiable Instruments Act, the complaint under challenge is filed. There is no criminal intention. The cheque cannot be treated to be forged document. 6 Cri.Appln.No.1873/2010 7) Mr.Sant, learned Counsel for Respondent No.2, the distributor, would argue that the agreements, though need not be disputed, but have been nakedly seen to be actuated with variance. Criminal intention on the part of the accused/applicant is manifest in tendering these documents. The allegation in the complaint are supported with the documents. The cheques were presented before the due date. The cheques were not to be presented until liability was fixed. Learned Counsel placed reliance to the judgment reported in AIR 2004 SC 555; AIR 2009 SC 2383 ( Ravindra Kumar Vs. M/S Rugmini Ram). 8) On reading the complaint, it is explicit that sweeping and general allegations are made against the accused/applicants. Applicant no.2, as is said, has no direct nexus and relation as he sits abroad and is a World Finance Director. 9) There was no reason for the complainant/respondent no.2 to incorporate the prosecution as has been done. Clause 3 of the complaint submits that the presentation or filling in the blanks in the cheque was not in terms of the agreement and, therefore, he was cheated. The accused/applicants did not credit the claimed amount in the account of Respondent 7 Cri.Appln.No.1873/2010 no.2. On the contrary, they have sent bills and misused the blank-signed cheques without any liability, as against respondent no.2. According to Respondent No.2, by misrepresentation and under sweet words, the blank-signed cheques were misused and false prosecution at Pune court under Section 138 of the Act was initiated. In clause 16, he submits that Respondent No.2/Complainant had been to Amalner police station to lodge a report, however, police did not accept it. Consequently, the complaint is lodged in the court. 10) The Full Bench of this Court in the matter of Panchbhai Popatbhai Butani and Ors. Vs. State of Maharashtra & Ors. ( 2010 Mah.L.J. 4221) explained the procedural scheme mandated by the statute by informing that a person has to approach the police station under Section 154 of Cr.P.C. and on refusal or failure by the police in registering an offence, the police officer in terms of Section 154(3) Cr.P.C. or other police officer referred to in section 36 of Cr.P.C. is to be approached. If despite approaching the Superintendent of Police, the grievance still persists, such aggrieved person can approach a Magistrate taking recourse to Section 156(3) of Cr.P.C. I quite see, in the present case, mere averment is made as referred above that the respondent no.2 purported to have approached the 8 Cri.Appln.No.1873/2010 police station without furnishing details in respect of the complaint, to whom it was made; who was the officer. Since there was no compliance of statutory mandate, the learned Judge should have desisted to take action in terms of Section 156(3) of Cr.P.C. The respondent no.2, having failed to comply with the statutory provisions, action, as sought, appears to be illegal. It is not that non-compliance of Section 154(1) or 153 by itself would throw the complaint. But, exceptional circumstances, like heinous crime, where police shows apathy, are to be informed to the Court while seeking directions of investigation in terms of Section 156(3) Cr.P.C. 11) Reference to the agreements, given by Mr. Sant, have its different theory, as from time to time, different agreements were prepared. One set thereof was with the respondent no.2, while one set remained with the complainant. The set with the distributor/Respondent no.2, if was un-filled at certain places, its fault could not be shouldered on the applicants/accused. The variance in filling in the blanks in the agreements would not change colour and complexion as the terms mandatorily operating between the parties remained in tact. Again, startling aspect seen in the complaint is, there is no 9 Cri.Appln.No.1873/2010 grievance in it about variance in the agreement. It mainly rotates and revolves to the use of the cheques without proper accounting. 12) The Hon'ble Apex court in the matter of Hridaya Ranjan Prasad Verma and Ors Vs. State of Bihar and Anr. - (2000) 4 SCC 168, have observed in paragraph 15, as under, - "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 made the promise cannot be presumed." 13) Judged on the touchstone of the principles noted above, the complaint, subject of 10 Cri.Appln.No.1873/2010 present criminal application, certainly calls for interference, as from any angle, the ingredients of the offence of cheating punishable under Section 420 of Cr.P.C. or allied offences or offence under Sections 406, 467, 468, 471 r/w 34 of IPC are not made out. 14) It is primarily indicative that to preempt action of prosecution at Pune Court in terms of Section 138 of the said Act, subject prosecution at Amalner, is initiated by the respondent no.2 to create pressure on the applicants herein. Nothing is demonstrated primarily to illustrate any forgery to any document. Filling in details in the cheque, to repeat, are in consonance to the authority under Section 20 of the Negotiable Instruments Act and would not amount to cheating or forgery. 15) Mr.Sant claims that inherent powers under Section 482 of Cr.P.C. should be sparingly exercised and in order to emphasize his point, has placed reliance to the judgment reported in AIR 2009 SC 1863 - (State of A.P. Vs. Aravapally Venkanna and Anr.). Paragraph 9, thereof reads as under , - "9. Whether the material already in existence or to be collected during investigation would be sufficient for holding the concerned accused 11 Cri.Appln.No.1873/2010 persons guilty has to be considered at the time of trial. At the time of framing the charge it can be decided whether prima facie case has been made out showing commission of an offence and involvement of the charged persons. At that stage also evidence cannot be gone into meticulously. It is immaterial whether the case is based on direct or circumstantial evidence. Charge can be framed, if there are materials showing possibility about the commission of the crime as against certainty. That being so, the interference at the threshold with the F.I.R. Is to be in every exceptional circumstances as held in R.P.Kapoors' case supra"" 16) Reliance to the judgment in the matter of Ravindra Kumar Madhanlal Goenka and Anr. Vs. M/s Rugmini Ram Raghav Spinners P.Ltd. - ( AIR 2009 SC 2383), is altogether on different footing. In the said case, the appellant had supplied 900 bales of cotton to respondent, however, he did not despatch 100 bales of cotton despite full payment. The Apex court observed, prima facie case of cheating and fraud was made out. 17) I quite see, defence raised by the accused can be considered at trial, however, in terms of proceedings in Section 482 Cr.P.C., the Court is free to consider material that may be 12 Cri.Appln.No.1873/2010 produced on behalf of accused to arrive at a decision, whether the case should be maintained. (2008) 14 SCC 1 – Rukhmini Narvekar Vs. Vijaya Satardekar and Ors. 18) Taking survey of all the facts, the prosecution questioned by the accused/applicants is abuse of process of the Court, calls for interference. Consequently, the FIR bearing No. 44/2010 dated 21.2.2010, registered with police Station, Amalner to the extent of the present applicants/accused is quashed and set aside. Rule made absolute in the aforesaid terms. sd/- (K.U.CHANDIWAL) JUDGE bdv/ fldr.16.6.11 Authenticated copy (BD VADNERE,PS)