IN THE HIGH COURT OF JUDICATURE OF ANDHRAPRADESH AT HYDERABAD HONOURABLE SRI JUSTICE SAMUDRALA GOVINDARAJULU CRIMINAL PETITION No.2985 of 2009 DATE: 24.09.2010 Between: M/s.XL Telecom Limited and others …… Petitioners And: Dr.Sridevi Rao and another …..Respondents HONOURABLE SRI JUSTICE SAMUDRALA GOVINDARAJULU CRIMINAL PETITION No.2985 of 2009 ORDER: The petitioners/A-1 to A-3 are accused of offence punishable under Section 420/34 I.P.C. in C.C. No.452 of 2008 on the file of XIV Additional Chief Metropolitan Magistrate, Hyderabad. A-1 is a company represented by its Managing Director. A-2 is Managing Director of A-1. A-3 is Vice President of A-1. It is alleged that A-2 and A-3 are in-charge of the plant established and owned by A-1 company at Cherlapalli, Hyderabad. The contention of the petitioner’s counsel that A-1 being a company cannot be prosecuted for an offence, is legally untenable. A company being a juristic person, is amenable to criminal proceedings and can be prosecuted in criminal Court, the only embargo being that no punishment of imprisonment can be imposed on a company which is a juristic person and which is not a physical person. 2) Subject matter of the complaint is landscaping work entrusted by A-1 company to the 1st respondent/complainant. There is no dispute about the facts that originally the complainant submitted estimate for Rs.38,19,510.75 Ps and after negotiations, the contract was finalised for Rs.28,91,114.14 Ps and that the complainant undertook the work relating to landscaping in an extent of about Ac.4-00 including building therein and that the complainant took the assistance of M/s.Sri Bhavani Nursery, Hyderabad, in executing the said work. It is the complainant’s case that she prepared final bill dated 29.03.2007 for Rs.34,42,100/-, out of which the complainant received Rs.12,82,940/- and that A-1 is still due a sum of Rs.21,59,160/- to the complainant. Alleging that the accused with evil intention to cheat the complainant wanted to avoid payment on some reason or the other and that the accused induced the complainant stating that they were running a reputed company and there will not be any problem for payments and induced the complainant to invest huge sums of money in developing the landscaping and that having the said dishonest intention from the very beginning, the accused accepted the quotation and gave work order and induced the complainant to do the works at her own cost promising to repay the amount as agreed, and that the accused cheated the complainant by not paying the balance amount, the complainant filed the complaint in the lower Court. In her sworn statement before the lower Court, she stated that they believe that the accused are trying to cheat them by not paying money. Simply because some amount which is alleged to be due from the accused is not paid to the complainant or the payment is avoided for any reason, the Court cannot jump to the conclusion that there is cheating on the part of the accused. The difference between offence of cheating and breach of contractual obligations, is thin. It has to be seen whether this case involves an offence of cheating or whether it remains to be a mere breach of contract giving raise to cause of action to file civil suit against the accused for the alleged money due from them. At this stage it may be noted that M/s.Sri Bhavani Nurseries filed O.S. No.131/2007 against A-1 and the complainant for recovery of moneys due relating to work of landscaping and it is pending in the Court of I Additional Chief Judge, City Civil Court, Secunderabad. Subsequent to filing of the present complaint in the lower Court, the complainant also filed O.S. No.179/2009 in the same civil Court against the accused for recovery of amounts due to her in this work relating to landscaping. There is dispute between the parties with regard to the extent of the work done by the complainant and the amount payable by A-1 to the complainant for the work done. The said dispute will be entertained and decided by the civil Court where two suits are pending between the parties as well as Sri Bhavani Nurseries. Simply because certain allegations are made in the complaint that there was dishonest intention from the very beginning, facts of this case cannot transform a civil case into a criminal case. There is no element of deception in this case from the beginning which induced the complainant to enter into work contract. Agreeing with the terms of contract, the complainant entered upon the work order and is stated to have carried out the work. When a dispute arose between the parties regarding quantum of work done by the complainant and the amount to be given for the work done to the complainant from A-1, it cannot be said that there is cheating. A subsequent dispute relating to a work regarding the amounts payable cannot be equated with an offence punishable under Section 420 I.P.C. In that view of the matter, this Court is of the opinion that dispute between the parties is one which is purely of civil nature and that remedy of the complainant against the accused is before civil Court. 3) In the result, the petition is allowed quashing proceedings in C.C. No.452 of 2008 on the file of XIV Additional Chief Metropolitan Magistrate, Hyderabad. _______________________________ SAMUDRALA GOVINDARAJULU, J September 24, 2010 KSH