1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CRIMINAL APPELLATE JURISDICTION CRIMINAL WRIT PETITION NO. 1597 OF 2008 ALONG WITH CRIMINAL WRIT PETITION NO.2541 OF 2009 1) Bhansali Textiles Mills Pvt.Ltd. ) 15, Bank of Baroda Building, Sakhar ) Bazar, Ahmedabad - 2, Gujarat. ) 2) Rinesh Kishorilal Bhansali, ) Age: Adult, Occu: Business & Company ) Director. ) 3) Kishorilal Mohanlal Bhansali, ) Age: Adult, Occu: Business & Company ) Director. ) 4) Vikas Kumar Kishorilal Bhansali, ) Age: Adult, Occu: Business and ) Company Director. ) 15, Bank of Baroda Building, Sakhar ) Bazar, Ahmedabad-2, Gujarat. ).. Petitioners Versus 1) State of Maharashtra ) 2) Mahendra Enterprises, ) through its proprietor, ) Shri Mahendrakumar Bhavarlal Sanklecha, ) 72, Shivshakti Chowk, Shaniwar Ward, ) Malegaon, Dist. Nashik, ) Through its General Power of attorney ) Holder, Shri Mukeshkumar Bhavarlal ) Sanklecha, Age: 27 years,Occu:Business, ) R/o - Gayatri Nagar, Ramsetu, Malegaon. )..Respondents. Shri J.J.Thakkar, Advocate, for the petitioners. Ms. A.T.Javeri, APP, for the respondent No.1 - State. Mr. Ramesh Dube -Patil, i/b.M/s.Jay & Co., Advocates, for respondent No.2. 2 WITH CRIMINAL WRIT PETITION NO. 2541 OF 2009 Mahendra Enterprises, ) through its proprietor, ) Shri Mukeshkumar Bhavarlal Sanklecha, ) 72, Shivshakti Chowk, Shaniwar Ward, ) Malegaon, Dist. Nashik, ) Through its General Power of attorney ) Holder, Shri Mukeshkumar Bhavarlal ) Sanklecha, Age: 28 years,Occu:Business, ) R/o - Gayatri Nagar, Ramsetu, Malegaon. ).. Petitioners Versus 1) Bhansali Textiles Mills Pvt.Ltd. ) 15, Bank of Baroda Building, Sakhar ) Bazar, Ahmedabad - 2, Gujarat. ) 2) Rinesh Kishorilal Bhansali, ) Age: Adult, Occu: Business & Company ) Director. ) 3) Kishorilal Mohanlal Bhansali, ) Age: Adult, Occu: Business & Company ) Director. ) 4) Vikas Kumar Kishorilal Bhansali, ) Age: Adult, Occu: Business and ) Company Director. ) 15, Bank of Baroda Building, Sakhar ) Bazar, Ahmedabad-2, Gujarat. ) 5) State of Maharashtra ).. Respondents Mr. Ramesh Dube - Patil i/b. M/s. Jay & Co.Advocates, for the petitioners. Mr.J.J.thakkar,Advocate, for the respondents Nos. 1, 3 & 4. Mr. A.T.Javeri, APP, for the respondent No.5 - State. 3 CORAM: J.H.BHATIA, J. DATE : 10th June, 2010. JUDGMENT 1. Rule. Rule made returnable forthwith and the matters are taken up for final hearing immediately. 2. Writ Petition No.1597 of 2008 is filed by original accused persons while respondent No.2 is the complainant in Criminal Case R.C. No.474/2007 filed in the Court of JMFC, Malegaon. Writ Petition No.2541 of 2009 is filed by the original complainant. 3. The complainant is the manufacturer of grey cloth and as per the complaint, the accused No.1. through its Directors - accused Nos. 2 to 4 had purchased grey cloth from the complainant since 2003-04. During the year 2003-04, grey cloth worth Rs.24,51,026/- was purchased and from time to time amount of Rs.10,95,000/- was paid by the accused to the complainant. It was also agreed between the parties that on delayed payments, the accused would pay interest at the rate of 24%. During the year 2003-04, amount of Rs.67,974/- was calculated towards interest on the delayed payments and the accused had deducted amount of Rs.6,797/- towards tax as per the TDS Rules and had issued a 4 certificate in favour of the complainant respect of that deduction. By the end of the year 2003-04, amount of Rs.14,17,203/- was due from the accused, inclusive of interest amount. During the year 2004-05, the accused purchased grey cloth for Rs.81,05,238/- and made payment of Rs.70,97,777/-. On delayed payment, interest was calculated at Rs.4,32,127/- and the accused had agreed to pay with interest. They had also deducted amount of Rs.44,077/- towards tax and had issued TDS certificate dated 30.5.2005 in favour of the complainant. By the end of 2004-05, amount of Rs.28,12,714/- was due from the accused to the complainant. That was also opening amount for the year 2005-06. During the year 2005-06, the accused made payment of Rs.15,90,000/- and there was still balance of Rs.11,95,295/-. On 2.6.2006, the accused also issued certificate about TDS. According to the complainant, amount of Rs.16,87,589/- inclusive of interest was still due from the accused. However, they were avoiding to make payment inspite of repeated requests. It was contended that there was change in the intention of the accused and therefore they had not made payment and were raising false plea of supply of defective goods since 2003 just to avoid payment. Finally, the accused denied any liability to pay the amount. Therefore, the complainant filed complaint for the offences punishable under Sections 420, 406, 468, 471, 504, 506, 120-B read with Section 34, I.P.C. The learned J.M.F.C. recorded the verification statement of the complainant and by order dated 12.10.2007 issued the 5 process against the accused Nos. 1 to 4 for the aforesaid offences. That order was challenged by the accused in Criminal Revision Application No.181/2007 before the Sessions Court. After hearing, the learned Additional Sessions Judge, Malegaon, partly allowed the Revision Application and set aside the issuance of process in respect of the offences under Sections 406, 468, 471, 504, 120B I.P.C., however, maintained the order about issuance of process in respect of the offence under Sections 420 and 506 read with Section 34 I.P.C. Being not satisfied, the accused have filed the present Writ Petition under Article 227 of the Constitution of India read with Section 482 Cr.P.C. The complainant has challenged the oder setting aside issuance of process in respect of some of offences. 4. The main contention of the accused is that from the facts stated in the complaint, it will be clear that it is a dispute of civil nature and therefore the complainant had remedy of filing a suit in a civil court. No criminal case is made out and the Courts below have committed error in issuing the process. It was also contended that the Magistrate could not have directed investigation under Section 156(3) after having recorded the verification statement of the complainant and that the material collected by the police during investigation under Section 156(3) could not be taken into consideration. 6 5. The accused No.4 - Vikas Kumar Bhansali has filed additional affidavit on behalf of all the accused along with several documents, including statements of accounts between the parties as well as the copies of the plaint in Special Civil Suit No.33/2008 filed by the complainant and the written statement filed by the accused as defence therein. 6. The learned Counsel for the accused vehemently contended that the Magistrate could not have directed investigation under Section 156(3) after having recorded the verification statement. However, in view of the facts of this case, I do not deem it necessary to enter into that controversy. From the facts disclosed in the complaint and as stated above, it is clear that since 2003-04, the business transactions were going on between the parties. The complainant is a producer of grey cloth and the accused used to purchase grey cloth from the complainant from time to time under different bills and invoices. In the first year i.e. 2003-04, having purchased cloth for Rs.24,51,026/-, the accused had made payment of Rs. 10,95,000/-. The TDS certificate was issued in respect of the deduction of tax from the interest amount which was calculated on the delayed payments. During the year 2004-05, large number of transactions had taken place and the accused had purchased grey cloth for Rs.81,05,238/- and payment of Rs.70,97,777/- was actually made. During that year also, interest amount on payment was calculated 7 and TDS certificate was issued. 7. The learned Counsel for the complainant contended that by issuing TDS Certificate, the accused induced the complainant to sell the goods to them though they had no intention to make full payment of the price of the goods. He contends that later on, the accused had taken a plea that TDS Certificates were issued only for the purpose of record and that amount was to be adjusted later on and there was no agreement about the payment of interest. The learned Counsel for the complainant contended that it shows the dishonest intention of the accused. However, the learned Counsel admitted that the amount of tax deduction as per the different TDS certificates was actually deposited with the Income Tax Department. The question is whether they were liable to pay the interest or not and whether they have raised a false plea that there was no such liability to pay interest to the complainant may be looked into in the civil suit which is filed by the complainant for recovery of the amount. It is difficult to accept the contention that the accused had induced the complainant to sell more goods by issuing TDS certificate without intention to make payment. Looking to the facts of the case, as disclosed in the complaint itself by the end of 2004-05 and at the beginning of 2005-06, an amount of Rs.28,12,714/- was due from the accused as per the account maintained by the complainant and it included the interest calculated for 8 different periods. During the year 2005-06 and thereafter, the accused had not purchased any goods. Even though the TDS certificate in respect of the year 2005 was issued on 2.6.2006. Even though the accused did not make any purchases during the year 2005-06, they had actually made payment of Rs. 11,95,295/- and at the end of 2005-06, an amount of Rs.16,87,589/- was found due from the accused as per the accounts maintained by the complainant. From this, it is clear that even after the purchases were completely stopped, the accused continued to make substantial payments. 8. There appears a dispute about the actual amount due from the accused to the complainant. The accused have contended in the present petition that certain goods were found defective and in respect of that, there was correspondence between the parties during the year 2004-05, particularly from July 2004 to January 2005. As contended in para 11 of the petition by the accused, at least 8 letters were addressed by the accused to the complainant about defective supplies and they have also filed a chart showing value of the defective goods supplied to them from time to time. Thus, there is dispute between the parties about supply of defective goods. There is a dispute about the rate of interest and liability of the accused to make payment of interest on the delayed payments and about the actual amount which is due from the accused to the 9 complainant. The learned Counsel for the accused contended that as per the written statement filed by them in the civil suit, no amount is due from them. Anyhow, that will require extensive evidence from both sides and that can be done in the civil suit which is already filed and is pending. Taking into consideration all these circumstances, it is difficult to hold that the accused had cheated the complainant and had induced them to sell the goods by cheating. 9. Taking into consideration the facts and circumstances, in my considered opinion, the dispute is purely of a civil nature and no criminal case is made out. Therefore, the orders passed by the Courts below to issue process are liable to be set aside. 10. For the aforesaid reasons, Writ Petition No.1597 of 2008 is allowed. The impugned orders are set aside and the complaint stands dismissed. Writ Petition No.2541 of 2009 stands dismissed. (J.H.BHATIA,J.)