IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA. CWP No. 4364 of 2010. Judgment reserved on :14.9.2010 Date of decision: 5.10.2010. Anil Menon ….. Petitioner. Versus State of H.P. and others …… Respondents. Coram The Hon’ble Mr. Justice Kurian Joseph, Chief Justice The Hon’ble Mr. Justice Kuldip Singh, Judge. For the petitioner : Mr. Sanjeev Bhushan, Advocate. For the respondents : Mr. R.K. Bawa, Advocate General with Mr. J.K. Verma, Dy. Advocate General, for respondents No.1 to 3. Mr. Tara Singh Chauhan, Advocate, for respondent No.4. ------------------------------------------------------------------------------------------ Kuldip Singh,J This petition under Article 226 of the Constitution of India has been filed for quashing FIR No.157/09 dated 30.6.2010 registered at Police Station, Solan under Section 420 IPC, with further prayer that a thorough inquiry be got conducted into the matter to find out the alleged misuse of power by the Judicial Officer, if any. 2. The case of the petitioner as emerges from the petition is that he is working as Manager Incharge, Stores and dispatch of Tele Brands ( India) Private Limited Company ( for short Company). The company sells various products and for selling such products, the company advertises through various TV channels. The company has more than 100 franchisees throughout India and the company has its own show rooms in almost all big cities of the country. 3. The company has its toll free numbers for placing orders of various products as are advertised and after getting the orders, the company sends such products to its customers. In June, 2009, one Mrs. Mukta Sharma, through credit card, placed an order for one Nicer Dicer (vegetable cutter) worth Rs.2,000/- plus postal charges. On receiving such order, the company on 25.6.2009 had despatched the Nicer Dicer through post. On 30.6.2009 the customer gave a call which was attended by Customer Support Executive Mrs. Pushpa. It was informed that parcel received by Mrs. Mukta Sharma contained some magazines and books instead of the product. The customer was immediately told to send back the parcel and it was further promised that the company would be sending a new parcel alongwith the product. 4. The company was waiting for the return of the parcel from Mrs. Mukta Sharma but, till 30.8.2009 the company did not receive any material from the customer. While so, on 30.8.2009 Sub Inspector Mr. Lajja Ram from Police Station, Solan alongwith two police constables came to the office of the company and it was told that the customer had filed a complaint and the police had registered a criminal case. The police party was explained the whole process and the procedure and they were convinced that there was no dishonest intention for the company and the pilferage had taken place in the transit only. In order to solve the problem, the company handed over one Nicer Dicer to Sub Inspector Mr. Lajja Ram. The company had also sent another Nicer Dicer which was delivered to Mrs. Mukta Sharma on 15.9.2009. As per information of the petitioner, the police had prepared a cancellation report with regard to the FIR lodged at Police Station, Solan. 5. On 29.6.2010 Sub Inspector Mr. Lajja Ram again came alongwith two police constables in the office of the company and informed that some further investigation was required to be done in the case and requested the petitioner to accompany him to Police Station, Solan. Accordingly, petitioner accompanied the police party headed by Sub Inspector Mr. Lajja Ram and reached Solan in the intervening night of 1-2 July, 2010. The petitioner was produced before Chief Judicial Magistrate, Solan on 6.7.2010 after keeping him under illegal detention for about six days. An application under Section 437 Cr.P.C. for grant of bail was moved on behalf of the petitioner. The learned Chief Judicial Magistrate remanded the petitioner to judicial custody till 17.7.2010. On 14.7.2010 the prosecution had filed another application for police remand which was dismissed on the same day by the learned Chief Judicial Magistrate. The prosecution was given time to file reply to the bail application and the bail was granted to the petitioner on 20.7.2010. 6. It is the case of the petitioner that FIR No.157/09 and other material collected by the police do not disclose commission of any offence much less under Section 420 IPC by the petitioner or the company. The petitioner has reasons to believe that everything has been done at the behest of the then learned Addl. District and Sessions Judge who happens to be the father of the complainant, the 4th respondent herein. The petitioner remained in illegal detention for a period of six days for the sake of about Rs.2000/-, he had to spend around 15 days in judicial custody. The FIR would show that one witness in the FIR is the Judicial Magistrate and second witness is District Attorney, Solan. The petitioner and his company have been implicated for an offence which they have never committed. 7. The respondent No.4 has filed reply and has taken the preliminary objection of maintainability in view of alternative remedy available to the petitioner. It has also been alleged that the disputed questions of facts are involved in the petition and therefore, petition cannot be decided. On merits, it has been denied that order for Nicer Dicer was placed by Mrs. Mukta Sharma. He has asserted that order for Nicer Dicer was placed by him. The respondent No.4 has however, stated that Mrs. Mukta Sharma is his mother. At the time of placing of the order bank account number of credit card was disclosed to the person attending the call. The respondent No.4 was told that firstly the product would be despatched and on its receipt the respondent No.4 would provide the password of the credit account number. However, an amount of Rs.2094/- was deducted from the credit account much prior to the sending of the product i.e. on 20.6.2009 by accessing the Pin Number of the Account Number without any authority of respondent No.4, who did not disclose the same to the petitioner or his company. The parcel which was received by respondent No.4 did not contain Nicer Dicer, but some old magazines were placed in the parcel. On the complaint made to the petitioner and his company, instead of sending the product, they misbehaved with respondent No.4 on telephone. In these circumstances, the complaint was lodged with the police. The petitioner or his company never took any sincere steps to send the parcel. It is only after four months after the intervention of the police that the petitioner and his company had sent the parcel. The respondent No.4 has alleged that petitioner and his company had won over the Investigation Officer, who did not take sincere steps to arrest the real culprits, the main accused owner or Director of the company have not been arrested till date. 8. Once the FIR has been registered it can be cancelled as per procedure prescribed in the Code of Criminal Procedure. The police has prepared the cancellation report without any basis. It has been denied that no case under Section 420 IPC is made out against the petitioner. It has been alleged that false and baseless allegations have been levelled against respondent No.4 just because his father is a Judicial Officer, merely to sensationalize the issue. The respondent No.4 by lodging an FIR merely asserted his legal rights. The petitioner and his company have illegally withdrawn the amount from the account; hence prima facie case under Section 420 IPC is made out against the petitioner and his company. The respondent No.4 has prayed for dismissal of the petition. 9. We have heard learned counsel for the parties. The learned counsel for the petitioner has reiterated the stand taken by the petitioner in the petition whereas learned counsel for respondent No.4 has submitted that FIR No.157/09 and other material collected on record disclose commission of offence committed by the petitioner and his company and as such FIR No.157/09 cannot be quashed at this stage. The petitioner has got alternative remedy at appropriate stage. The learned counsel for respondent No.4 has prayed for dismissal of the petition 10. We have called for the record of the investigation. It transpires that the police had prepared an untraced report on 13.5.2010 in FIR No.157/09. On 2.6.2010 complainant- respondent No.4 had written letter to respondent No.2 requesting him that intimation may be given as to what action, if any, has been taken in FIR No.157/09 and if no action so far has been taken, the matter be proceeded further as the Investigating Officer might have connived with the accused. The respondent No.2 had asked the explanation of Mr. Lajja Ram Sub Inspector vide letter dated 2.6.2010. In the letter dated 2.6.2010 it has been stated that after perusal of zimnies pertaining to FIR No.157/09 dated 30.6.2009, it was found that investigation was conducted by Mr. Lajja Ram and he had gone to Bombay on 29.8.2009 for investigation but nothing was done at Bombay. No action was taken against owner/employees of the company which has put question mark on the working of the police. The explanation of Mr. Lajja Ram was called for this purpose within three days. He was directed to appear in person alongwith file on 4.6.2010 before respondent No.2. 11. The Rapat roznamcha dated 4.6.2010, Police Post, Kuthar, Police Station; Kasauli indicates that Mr. Lajja Ram reported at about 8 p.m. at Police Post after meeting the Superintendent of Police, Solan. He was directed by Superintendent of Police to go to Mumbai for investigation in FIR No.157/09 after 25/26.6.2010. The order dated 8.9.2010, in the petition indicates that Mr. Lajja Ram was initially entrusted with the investigation. He was transferred from Solan in September, 2009. He had gone to Bombay in June, 2010 as per notice served upon him by Mr. V.K. Dhawan, Superintendent of Police. 12. The FIR No.157/09 is registered under Section 420 IPC. The Section 420 IPC reads as under:- “Cheating and dishonestly inducing delivery of property-Whoever cheats and thereby dishonestly induces the person deceived to deliver any property to any person, or to make, alter or destroy the whole or any part of a valuable security, or anything which is signed or sealed, and which is capable of being converted into a valuable security, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine”. The Section 415 IPC reads as follows: “Cheating – Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces the person so deceived 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, is said to “cheat”. 13. Ordinarily the superior courts do not interfere in the process of investigation and trial. Such interventions are exception only. What and which are those exceptional situations, we may examine. In one of the early decisions, in Sunder Singh and others v. King-Emperor of India 1904 PR (40) 25, it has been held as follows:- “…………….The offence of cheating, as defined in Section 415, Indian Penal Code, however requires that the person made to deliver property, &c, or to do or omit to do anything which causes or is likely to cause him damage in body, mind, reputation or property, and which he would not otherwise have done, should be the person who has been deceived. The offence is not committed if a third party, on whom no deception has been practised, sustains pecuniary loss in consequence of the accused’s act”…………… 14. In Haridaya Ranjan Prasad Verma and others v. State of Bihar and another (2000) 4 SCC 168 it has been held as follows:- “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.” 15. In V.Y. Jose and another v. State of Gujrat and another (2009) 3 SCC 78 it has been held as follows:- “21. There exists a distinction between pure contractual dispute of a civil nature and an offence of cheating. Although breach of contract per se would not come in the way of initiation of a criminal proceeding, there cannot be any doubt whatsoever that in the absence of the averments made in the complaint petition wherefrom the ingredients of an offence can be found out, the court should not hesitate to exercise its jurisdiction under Section 482 of the Code of Criminal Procedure” . “30. It is in that sense, a distinction between a mere breach of contract and the offence of cheating should be borne in mind. We, having regard to the facts and circumstances of the case, are of the opinion that no case has been made out against the appellant so as to hold that he should face the criminal trial.” 16. In Mohammed Ibrahim and others v. State of Bihar and another (2009) 8 SCC 751 in paragraphs 21, 22 it has been held as follows:- “21. It is not the case of the complainant that any of the accused tried to deceive him either by making a false or misleading representation or by any other action or omission, nor is it his case that they offered him any fraudulent or dishonest inducement to deliver any property or to consent to the retention thereof by any person or to intentionally induce him to do or omit to do anything which he would not do or omit if he were not so deceived. Nor did the complainant allege that the first appellant pretended to be the complainant while executing the sale deeds. Therefore, it cannot be said that the first accused by the act of executing sale deeds in favour of the second accused or the second accused by reason of being the purchaser, or the third, fourth and fifth accused, by reason of being the witness, scribe and stamp vendor in regard to the sale deeds, deceived the complainant in any manner. 22. As the ingredients of cheating as stated in Section 415 are not found, it cannot be said that there was an offence punishable under Sections 417, 418, 419 or 420 of the Code.” In paragraph-23 the Supreme Court has clarified as follows:- “When we say that execution of a sale deed by a person, purporting to convey a property which is not his, as his property, is not making a false document and therefore not forgery, we should not be understood as holding that such an act can never be a criminal offence. If a person sells a property knowing that it does not belong to him, and thereby defrauds the person who purchased the property, the person defrauded, that is, the purchaser, may complain that the vendor committed the fraudulent act of cheating. But a third party who is not the purchaser under the deed may not be able to make such complaint.” 17. In Dalip Kaur and others v. Jagnar Singh and another (2009) 14 SCC 696, it has been held as follows:- “The High Court, therefore, should have posed a question as to whether any act of inducement on the part of the appellant has been raised by the second respondent and whether the appellant had an intention to cheat him from the very inception. If the dispute between the parties was essentially a civil dispute resulting from a breach of contract on the part of the appellants by non-refunding the amount of advance the same would not constitute an offence of cheating. Similar is the legal position in respect of an offence of criminal breach of trust having regard to its definition contained in Section 405 of the Penal Code. (See Ajay Mitra v. State of M.P.).” 18. In S.P. Gupta v. Ashutosh Gupta (2010) 6 SCC 562 it has been held as follows:- “It is true, as pointed out by Mr. Lekhi, that Section 415 IPC, which defines the offence of cheating, provides in Illustration(g) as follows:- “415.(g) A intentionally deceives Z into a belief that A means to deliver to Z a certain quantity of indigo plant which he does not intend to deliver, and thereby dishonestly induces Z to advance money upon the faith of such delivery, A cheats; but if A, at the time of obtaining the money, intends to deliver the indigo plant, and afterwards breaks his contract and does not deliver it, he does not cheat, but is liable only to a civil action for breach of contract.” However, the aforesaid provision clearly indicates that if at the very initiation of the negotiations it was evident that there was no intention to cheat, the dispute would be of a civil nature. But such a conclusion would depend on the evidence to be led at the time of trial.” 19. Inherent power of High Court for quashing proceedings has been dealt with by the Supreme Court in R.P. Kapur v. State of Punjab AIR 1960 SC 866 which reads as follows: “It is well established that the inherent jurisdiction of the High Court can be exercised to quash proceedings in a proper case either to prevent the abuse of the process of any court or otherwise to secure the ends of justice. Ordinarily criminal proceedings instituted against an accused person must be tried under the provisions of the Code, and the High Court would be reluctant to interfere with the said proceedings at an interlocutory stage. It is not possible, desirable or expedient to lay down any inflexible rule which would govern the exercise of this inherent jurisdiction. However, we may indicate some categories of cases where the inherent jurisdiction can and should be exercised for quashing the proceedings. There may be cases where it may be possible for the High Court to take the view that the institution or continuance of criminal proceedings against an accused person may amount to the abuse of the process of the court or that the quashing of the impugned proceedings would secure the ends of justice. If the criminal proceeding in question is in respect of an offence alleged to have been committed by an accused person and it manifestly appears that there is a legal bar against the institution or continuance of the said proceeding the High Court would be justified in quashing the proceeding on that ground. Absence of the requisite sanction may, for instance, furnish cases under this category. Cases may also arise where the allegations in the First Information Report or the complaint, even if they are taken at their face value and accepted in their entirety, do not constitute the offence alleged; in such cases no question of appreciating evidence arises; it is a matter merely of looking at the complaint or the First Information Report to decide whether the offence alleged is disclosed or not. In such cases it would be legitimate for the High Court to hold that it would be manifestly unjust to allow the process of the criminal court to be issued against the accused person. A third category of cases in which the inherent jurisdiction of the High court can be successfully invoked may also arise. In cases falling under this category the allegations made against the accused person do constitute an offence alleged but there is either no legal evidence adduced in support of the case or evidence adduced clearly or manifestly fails to prove the charge. In dealing with this class of cases it is important to bear in mind the distinction between a case where there is no legal evidence or where there is evidence which is manifestly and clearly inconsistent with the accusation made and cases where there is legal evidence which on its appreciation may or may not support the accusation in question. In exercising its jurisdiction under S. 561-A the High Court would not embark upon an enquiry as to whether the evidence in question is reliable or not. That is the function of the trial magistrate, and ordinarily it would not be open to any party to invoke the High Court’s inherent jurisdiction and contend that on a reasonable appreciation of the evidence the accusation made against the accused would not be sustained. Broadly stated that is the nature and scope of the inherent jurisdiction of the High Court under S. 561-A in the matter of quashing criminal proceedings, and that is the effect of the judicial decisions on the point.” 20. In State of Haryana and others v. Bhajan Lal and others 1992 Supp(1) SCC 335 in paragarh 102 of the judgment it has been held as follows:- “In the backdrop of the interpretation of the various relevant provisions of the Code 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 or the inherent powers under Section 482 of the Code which we have extracted and reproduced above, we give the following categories of cases by way of illustration wherein such power could be exercised either to prevent abuse of the process of any court or otherwise to secure the ends of justice, though 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 of myriad kinds of cases wherein such power should be exercised. (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 concerned Act (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings