IN THE HIGH COURT OF JUDICATURE ANDHRA PRADESH AT HYDERABAD FRIDAY THE TWELVETH DAY OF MARCH TWO THOUSAND AND TEN PRESENT: THE HONOURABLE SRI JUSTICE P. S. NARAYANA CRIMINAL PETITION Nos. 8451, 8452, 8450 & 8454 of 2009 (COMMON ORDER ) CRLP.No. 8451 OF 2009 Between: B. Madhavi … Petitioner V/s. R. Manga & Anr. … Respondents CRLP.No. 8452 OF 2009 Between: D.Ramasita … Petitioner V/s. R. Manga & Anr. … Respondents CRLP.No. 8450 OF 2009 Between: B. Ravi kumar … Petitioner V/s. R. Manga & Anr. … Respondents CRLP.No. 8454 OF 2009 Between: D. Satyanarayan Raju … Petitioner V/s. R. Manga & Anr. … Respondents Counsel for the Petitioner : Sri K. Surender Counsel for the Respondents : Sri G.L. Narsimha Rao for R-1. Addl. Public Prosecutor for R- 2. COMMON ORDER : (Full text of the common order follows on 3rd page) THE HONOURABLE SRI JUSTICE P. S. NARAYANA CRIMINAL PETITION Nos. 8451, 8452, 8450 & 8454 of 2009 COMMON ORDER : In view of the commonality of questions of fact and questions of law involved in these criminal petitions, all these criminal petitions are being disposed offby a common order. 2. These matters appear under the caption of “interlocutory”. At request of the counsel on record, these matters were heard finally and these matters are being disposed off finally. 3. Sri K. Surender, the learned counsel representing the petitioners in all these criminal petitions would maintain that only in one of the matters vacate stay application had been filed. However, the facts are almost similar in all these criminal petitions. The learned counsel would maintain that the allegations of threats had been introduced only so as to see that cases are registered by the police. The learned counsel would also maintain that these allegations are clearly false allegations, for the reason that all these matters are concerned with the loan transaction and these are cases concerned with dishonour of cheques. The counsel would also maintain that these cases are clear cases of abuse process of law, for the reason that though they are simple money transactions or loan transactions. 4. The petitioners are charged under section 420 IPC. Even if the allegations are to be carefully examined, the disputes involved in these cases are of civil nature. The learned counsel relied on several decisions to substantiate his submissions. Further the learned counsel would point out that though section 138 of Negotiable Instruments Act is available, the defacto complainant had not chosen to pursue such remedy available to her but thought of seeing that a false case is registered under section 420 of IPC. Hence, in the light of the decisions, which had been relied upon the proceedings are liable to be quashed. 5. The learned Additional Public Prosecutor had taken this court through the relevant portions of the F.I.R., and would maintain that it is not as though it is simply a case under section 420 of IPC there are certain other allegations and in the light of the certain other allegations also which had been specified in the respective F.I.R.s., these are not the fit matters to be interfered with under section 482 of the Code of Criminal Procedure {hereinafter referred to for short ‘the Code’ for the purpose of convenience}. 6. Sri G.L. Narsimha Rao, the learned counsel representing the defacto complainant in all these matters would maintain that these may be money transactions but the fact remains that the respective petitioners-accused had issued cheques. These cheques were dishonoured and when the ingredients of section 420 IPC are other wise satisfied, the mere fact that remedy is available under section 138 of Negotiable Instruments Act and the same had not been invoked and that by itself cannot be a ground to quash the proceedings. 7. The learned counsel strongly relied on the decision of the full Bench of this Court in M/s. OPTS Marketing Pvt. Ltd., & Ors. V/s. State of A.P. &Anr.[1]. While elaborating his submissions the learned counsel would maintain that it is not as though the respective the crime had been registered only under section 420 IPC simplicitor, there are certain other allegations. In the light of the same in any event, these are not the matters to be interfered with under section 482 of the Code. 8. Heard the counsel on record. Perused the allegations made in the respective FIRs and also the grounds raised in all these criminal petitions. 9. In Criminal Petition No. 8451 of 2009, it is stated that the petitioner is arrayed as accused in Cr.No. 1178 of 2009 of P.S. Kukkatpally, Cyberabad, Ranga Reddy district, which was registered for the offence under section 420, 427, 447 and 506 of IPC. It is alleged in the complaint that the petitioner and her husband availed a loan of Rs.25 lakhs on 02-8-2007 and executed promissory notes. The loan was taken on interest at 30% per annum and on failure to repay a cheques for Rs.12 lakhs dated 09-6-2009 was given, which was dishonoured on presentation. It is also stated that a statutory legal notice under section 138 of Negotiable Instruments Act was sent but the same was returned as “not claimed”. Therefore, the petitioner committed the offence of cheating and on 09- 8-2009 the petitioner threatened defacto complainant with the help of anti-social elements. 10. In Criminal Petition No. 8450 of 2009, it is stated that the petitioner is arrayed as accused in Cr.No.1179 of 2009 of Police Station Kukkatpally, Cyberabad, Ranga Reddy district, which was registered for the offence under sections 420, 427, 447 and 506 of IPC. It is alleged in the complaint that the petitioner and his wife availed a loan of Rs.25 lakhs on 02-8-2007 and executed promissory notes. The loan was taken on interest @ 30% per annum and on failure to repay a cheques for Rs.5 lakhs dated 18-09-2008 was given, which was dishonoured on presentation. It is also stated that a statutory legal notice under section 138 of Negotiable Instruments Act was sent but the same was returned as “not claimed”. Therefore, the petitioner committed an offence of cheating and on 09-8-2009 the petitioner threatened defacto complainant with the help of anti-social elements. 11. Similar grounds had been specified in this criminal petition as well. 12. Criminal Petition No. 8452 of 2009 is filed praying for quashing Cr.No. 1184 of 2009 of Police Station Kukkatpally, Cyberabad, Ranga Reddy district, which was registered for the offence under section 420, 427, 447 and 5-6 IPC. It is stated that the defacto complainant availed a loan of Rs.11 lakhs on 05-5-2007 and executed a cheques dated 09-6-2009 for an amount of Rs.10 lakhs. The said cheques was dishonoured on presentation for the reason of the account being closed. A statutory legal notice under section 138 of Negotiable Instruments Act was sent and served on the petitioner. Specific stand taken by the defacto complainant that the petitioner has committed the offence of cheating and on 10-8-2009 further specific stand taken by the defacto complainant that the petitioner threatened defacto complainant with the help of anti-social elements. 13. Similar grounds had been specified even in this Criminal Petition. 14. Criminal Petition No. 8454 of 2009 is filed praying for quashing Cr.No. 1185 of 2009 of Police Station Kukkatpally, Cyberabad, Ranga Reddy district, which was registered for the offence under sections 420, 427, 447 and 506 of IPC. It is stated that the petitioner availed a loan of Rs.10 lakhs on 04-6-2009 and executed a cheques dated 09-6-2009. The said cheques were dishonoured on presentation for the reason of the account being closed. A statutory legal notice under section 138 of Negotiable Instruments Act was sent and served on the petitioner. Specific stand had been taken that the petitioner committed an offence of cheating and on 10-8-2009 the petitioner threatened the defacto complainant with the help of anti-social elements. Almost similar grounds had been specified in these criminal petitions as well. 15. On a careful examination of the facts in all these criminal petitions especially in the light of the specific allegation made in the respective FIRs, it is no doubt clear that the cheques had been issued and cheques had been dishonoured and for reasons best known, the defacto complainant had not chosen to pursue the remedy available to her under section 138 of Negotiable Instruments Act. No doubt specific stand had been taken that blank cheques were issued by way of security and those had been utilized. It is needless to doubt that predominantly it is a question of fact. Certain submissions were made that the remedy under section 138 of Negotiable Instruments Act is available. The question of cheating under section 420 IPC would not arise especially in a case of this nature. It is purely a monetary transaction or loan transaction. However, the learned counsel representing the defacto-complainant placed strong reliance on the decision in M/s. OPTS Marketing Pvt. Ltd., & Ors. V/s. State of A.P. &Anr. referred supra-1, wherein the full Bench was pleased to observe: “In the result, we hold that (i) even after introduction of Section 138 of Negotiable Instruments Act, prosecution under section 420 IPC is maintainable in case of dishonour of cheques or postdated cheques issued towards payment of price of the goods purchased or hand loan taken, or in discharge of an antecedent debt or towards payment of goods supplied earlier, if the charge sheet contains an allegation that the accused had dishonest intention not to pay even at the time of issuance of the cheques, and the act of issuing the cheques, which was dishonoured, caused damage to his mind, body or reputation, (ii) private complaint or FIR alleging offence under section 420 iPC for dishonour of cheques or postdated cheques cannot be quashed under section 482 Cr.P.C., if the averments in the complaint show that the accused had, with a dishonest intention and to cause damage to his mind, body or reputation, issued the cheques which was not honoured.” 16. The learned counsel representing respective petitioners in all these criminal petitions placed strong reliance on several decisions; ALPIC FINANCE LIMITED V/s. P. SADASIVAN AND ANR [2], the Apex Court observed at para No.10: “The facts in the present case have to be appreciated in the light of the various decisions of this Court. When somebody suffers injury to his person, property or reputation, he may have remedies both under civil and criminal law. The injury alleged may form the basis of civil claim and may also constitute the ingredients of some crime punishable under criminal law. When there is dispute between the parties arising out of a transaction involving passing of valuable properties between them, the aggrieved person may have a right to sue for damages or compensation and at the same time, law permits the victim to proceed against the wrongdoer for having committed an offence of criminal breach of trust or cheating. Here the main offence alleged by the appellant is that the respondents committed the offence under section 420 IPC and the case of the appellant is that the respondents have cheated him and thereby dishonestly induced him to deliver property. To deceive is to induce a man to believe that a thing is true which is false and which the person practicing the deceit knows or believes to be false. It must also be shown that there existed a fraudulent and dishonest intention at the time of commission of the offence. There is no allegation that the respondents made any wilful misrepresentation. Even according to the appellant, the parties entered into a valid lease agreement and the grievance of the appellant is that the respondents failed to discharge their contractual obligations. In the complaint, there is no allegation that there was fraud or dishonest inducement on the part of the respondents and thereby the respondents parted with the property. It is trite law and common sense that an honest man entering into a contract is deemed to represent that he has the present intention of carrying it out but if having accepted the pecuniary advantage involved in the transaction, he fails to pay his debt, he does not necessarily evade the debt by deception. ” 17. Further strong reliance was placed in HRIDAYA RANJAN Pd. VERMA AND ORS. V/s. STATE OF BIHAR AND ANR [3], wherein the Apex Court observed at paras Nos. 14, 15 and 16 as follows: “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 delivery 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. In determining the question it has tobe kept in mind that the distinction between mere breach of contract and the offence of cheating is a find 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. Judged on the touchstone of the principles noted above, the present case, warrants interference inasmuch as the ingredients of the offence of cheating punishable under section 420 IPC and its allied offences under sections 418 and 423 has not been made out. So far as the offences under section 469, 504 and 120-B are concerned even the basic allegations making out a case thereunder are not contained in the complaint. Reading the averments in the complaint in entirety and accepting the allegations tobe true, the ingredients of intentional deception on the part of the accused right at the beginning of the negotiations for the transaction has neither been expressly stated nor indirectly suggested in the complaint. All that the respondent No.2 has alleged against the appellants is that they did not disclose to him that one of their brothers had filed a partition suit which was pending. The requirement that the information was not disclosed by the appellants intentionally in order to make the respondent No.2 part with property is not alleged expressly or even impliedly in the complaint. Therefore, the core postulate of dishonest intention in order to deceive the complainant-respondent No.2 is not made out even accepting all the averments in the complaint on their face value. In such a situation continuing the criminal proceeding against the accused will be an abuse of process of the Court.” 18. Further strong reliance was placed on a decision in INDER MOHAN GOSWAMI AND ANR. V/s. STATE OF UTTARANCHAL AND ORS [4], wherein it was observed that when the dispute is of civil nature and the averments alleged in the FIRs may not be just and proper to permit the prosecution tobe further proceeded with and it may amounts to abuse of process of court. 19. The Apex Court in the decision referred to supra-4, at para Nos. 41 and 42 has observed : Section 415 IPC thus requires :- 1. Deception of any person. 2. (a) Fraudulently or dishonestly inducing that person – (i) to delivery any property to any person; or (ii) to consent that any person shall retain any property; or (b) Intentionally inducing that person to do or omit to do anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, mind, reputation or property. On a reading of the aforesaid section, it is manifest that in the definition there are two separate classes of acts, which the person deceived may be induced to do. In the first class of acts, he may be induced fraudulently or dishonestly to deliver property too any person. The second class of acts 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 intentional but need not be fraudulent or dishonest. 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 a fraudulent or dishonest intention at the time of making the promise. From his mere failure to subsequently keep a promise, one cannot presume that he all along had a culpable intention to break the promise from the beginning. 19. In R.P. KAPUR V/s. State of Punjab [5], the Apex Court while summarizing some categories of cases, where inherent power can and should be exercised to quash the proceedings; i) where it manifestly appears that there is a legal bar against the institution or continuance of the proceedings; ii) where the allegation in the first information report or complaint taken at their face value and accepted in their entirety do not constitute the offence alleged; iii) where the allegations constitute an offence, but there is no legal evidence adduced or the evidence adduced clearly or manifestly fails to prove the charge. 20. In State of Karnataka V/s. L. Muniswamy [6], wherein the Apex Court in para 28 has observed: “The wholesome power under section 482 Cr.P.C. entitles the High Court to quash a proceeding when it comes to the conclusion that allowing the proceeding to continue would be an abuse of the process of the court or that the ends of justice require that the proceeding ought tobe quashed. The High Courts have been invested with inherent powers, both in civil and criminal matters, to achieve a salutary public purpose. A court proceeding ought not be permitted to9 degenerate into a weapon of harassment or persecution. The Court observed in this case that ends of justice are higher than the ends of mere law though justice must be administered according to laws made by the legislature. This case has been followed in a large number of subsequent cases of this Court and other courts.” 21. In State of Haryana V/s. Bhajan Lal [7]., The Apex in the backdrop of interpretation of various relevant provisions of Cr.P.C. under Chapter XIV and of the principles of law enunciated by this Court in a series of decisions relating to the exercise of the extraordinary power under Article 226 of the Constitution of India or the inherent powers under section 482 Cr.P.C. gave the following categories of cases by way of illustration wherein such power could be exercised either to prevent abuse of the process of the court or other wise to secure the ends of justice. Thus, this Court made it clear that it may not be possible to lay down any precise, clearly defined and sufficiently channelised and inflexible guidelines or rigid formulae and to give an exhaustive list to myriad kinds of cases wherein such power should be exercised. (SCC pp. 378-379, para 102) “102. (1) Where the allegations made in the first information report or the complaint, even if they are taken at their face value and accepted in their entirety do not prima facie constitute any offence or make out a case against the accused. (2) Where the allegations in the first information report and other materials, if any, accompanying the FIR do not disclose a cognizable offence, justifying an investigation by police officers under section 156 (1) of the Code except under an order of a Magistrate within the purview of Section 155 (2) of the Code. (3) Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same do not disclose the commission of any offence and make out a case against the accused. (4) Where the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated under section 155 (2) of the Code. (5) where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused. (6) Where there is an express legal bar engrafted in any of the provisions of the Code or the Act concerned (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the Act concerned, providing efficacious redress for the grievance of the aggrieved party. (7) Where a criminal proceeding is manifestly attended with malafide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge.” 22. In Janata Dal V/s. H.S. Chowdhary[8]., the Apex Court observed thus (SCC p.355, para 132) “132. The criminal courts are clothed with inherent power to make such orders as may be necessary for the ends of justice. Such power though unrestricted and undefined should not be capriciously or arbitrarily exercised, but should be exercised in appropriate cases, ex debito justitiae to do real and substantial justice for the administration of which alone the courts exist. The powers possessed by the High Court under section 482 of the Code are very wide and the very plentitude of the power requires great caution in its exercise. Courts must be careful to see that its decision in exercise of this power is based on sound principles.” 23. In G. Sagar Suri V/s. State of U.P. [9], the Supreme Court observed that it is the duty and obligation of the criminal court to exercise a great deal of caution in issuing the process, particularly when matters are essentially of civil nature. 24. In Roy V.D. V/s. State of Kerala [10]., the Apex Court observed thus : (SCC p. 597, para 18) “18. It is well settled that the power under section 482 Cr.P.C. has to be exercised by the High Court, inter alia, to prevent the abuse of the process of any court or other wise to secure the ends of justice. Where criminal proceedings are initiated based on illicit material collected on search and arrest which are per se illegal and vitiate not only a conviction and sentence based on such material but also the trial itself, the proceedings cannot be allowed to go on as it cannot but amount to abuse of the process of the court, in such a case not quashing the proceedings would perpetuate abuse of the process of the court resulting in great hardship and injustice to the accused. In our opinion , exercise of power under section 482 Cr.P.C. to quash proceedings in a case like the one on hand, would indeed secure the ends of justice.” 25. In the light of the decisions referred to above, the view expressed by the full bench of this court, merely because the remedy under section 138 of Negotiable Instruments Act had not been