IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE THOMAS P.JOSEPH MONDAY, THE 4TH APRIL 2011 / 14TH CHAITHRA 1933 Crl.MC.No. 3893 of 2010() ------------------------- CC.340/2007 of JUDL.MAGISTRATE OF FIRST CLASS-I, KANJIRAPPALLY .................... PETITIONER(S): ACCUSED: ----------------------------------------- JOJI THOMAS, AGED 42 YEARS, S/O.THOMAS, MUNDIYARAYIL, KANJIRAPPALLY.P.O., KANJIRAPPALLY VILLAGE,PRESENTLY RESIDING AT 822, TOLLEY C.T.,SAN RAMON,USA REPRESENTED BY HIS P.A.HOLDER, K.GEEVARGHESE, AGED 70 YEARS,S/O.KURIAKOSE, KANJIRATHUMKUDY,ASSAMANNOOR.P.O., ASSAMANNOOR VILLAGE. BY ADVS. SRI.V.C.JAMES, SRI.C.HARINDRAMOHAN NAIR, SRI.SERGI JOSEPH THOMAS. RESPONDENT(S): --------------------------- 1. STATE OF KERALA, REPRESENTED BY S.I. OF PLICE, KANJIRAPPALLY THROUGH THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM-682 031. 2. THANKACHAN ALIAS JOSEPH THOMAS, AGED ABOUT 60 YEARS, SON OF THOMAS, MATTEL, EDAKKUNNAM.P.O., EDAKKUNNAM VILLAGE-682 020. R1 BY PUBLIC PROSECUTOR SRI. K.J.MOHAMMED ANZAR R2 BY ADV. SRI.LIJI.J.VADAKEDOM THIS CRIMINAL MISC. CASE HAVING BEEN FINALLY HEARD ON 04/04/2011, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: Kss THOMAS P.JOSEPH, J. ==================================== Crl. M.C. No.3893 of 2011 ==================================== Dated this the 04th day of April, 2011 O R D E R Petitioner is accused in Crime No.70 of 2007 of Kanjirappally Police Station and C.C. No.340 of 2007 of the court of learned Judicial First Class Magistrate-I, Kanjirappally for offences punishable under Sections 420 and 406 of the Indian Penal Code. The second respondent filed a complaint alleging that as per an oral agreement dated 15.02.2006 with petitioner he had constructed a residential building for the petitioner, it is on the inducement and promise given by petitioner that he entered into the contract and constructed the building but later, petitioner withdrew from the promise and thereby committed breach of trust and cheating. The complaint was forwarded to the police for investigation under Sec.156(3) of the Code of Criminal Procedure (for short, “the Code”). The Police investigated the case and submitted a final report for offences above stated. Petitioner requests to quash the final report and further proceeding in C.C. No.340 of 2007. Learned counsel contended that the dispute is purely of a civil nature and that it is attempted to be converted CRL.M.C. No.3893 of 2010 -: 2 :- into a criminal proceeding to compel petitioner meet demands of second respondent which according to the learned counsel are not in accordance with the terms of the contract. It is also contended that averments in the complaint do not disclose any offence as alleged and that by merely quoting the ingredients of the relevant Sections in the complaint a civil dispute cannot be converted into a criminal prosecution. Learned counsel for second respondent contended that at this stage where this Court is considering whether proceeding is to be quashed what is required is only to ascertain whether allegations in the complaint make out a case against petitioner and if so this Court has to keep its hands off leaving the matter to the trial court to decide whether the allegations are true or not. 2. The Supreme Court in State of Haryana v. Bhajan Lal (AIR 1992 SC 604 – paragraph 108) has stated the circumstances under which High Court could interfere under Section 482 of the Code to quash criminal proceeding. If allegation do not make out a case it is well within the power of the High Court to interfere in exercise of its inherent jurisdiction. Question for consideration is whether the allegations in the complaint and final report are sufficient to make out a case for CRL.M.C. No.3893 of 2010 -: 3 :- trial as pleaded by the second respondent. 3. It is not disputed that there was an oral agreement between parties on 15.02.2006 as per which construction of the residential building of petitioner was entrusted to the second respondent According to the second respondent, petitioner was to pay `110/- per square foot as per the said agreement. The measurement was to be taken along the outer side of the building. The second respondent was getting periodical payments and the work was completed on 14.02.2007. On measurement being taken (as second respondent claimed) it was found that the building has a plinth area of 3509 sq.ft and floor area of 2700 of sq.ft. Second respondent was entitled to get `3,85,990/- for construction of building and `1,12,848/- for carrying out allied works. But petitioner paid only `2,97,000/- for construction of the building and `63,700/- for the allied works done by the second respondent. Thus it is alleged that petitioner caused loss of `1,12,848/- to the second respondent. It is also alleged that petitioner cheated the second respondent, committed breach of trust and thereby committed offences as alleged. According to the petitioner the account was settled on 01.02.2007 and two cheques dated 01.02.2007 were given to the CRL.M.C. No.3893 of 2010 -: 4 :- second respondent with the endorsement on its back that the said payments were in full and final settlement of all claims of the second respondent. Petitioner has produced Annexures-IV & V, attested photocopies of the said cheques. 4. Section 405 of the IPC defines criminal breach of trust and says that whoever being in any manner entrusted with property or with any dominion over property dishonestly misappropriates or coverts to his own use the property or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged or of any legal contract express or implied which he has made touching the discharge of such trust, or willfully suffers any other person so to do, commits criminal breach of trust. In the present case it is not as if any property has been entrusted with petitioner or he is given dominion over the property for any purpose or such property has been misappropriated by the petitioner or converted for his own use in violation of any direction of law prescribed by the mode in which such trust is proved to be discharged. Apparently the offence under Sec.405 of the IPC is not attracted. 5. What remained is offence of cheating as defined in CRL.M.C. No.3893 of 2010 -: 5 :- Sec.415 of the IPC. That provision defines cheating as 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. Learned counsel for the second respondent has invited my attention to illustration (g) of Sec.415 of the IPC to buttress his contention that inducement and promise made by petitioner that the measurement will be taken along outer side of the building made the second respondent to enter into contract with petitioner but in violation of the same measurement of the floor area was taken and payment was made. According to the learned counsel it was with the intention of cheating the second respondent that petitioner entered into the contract. Petitioner denied existence of any such agreement which of course is not required to gone into by this Court at this stage. 6. Question is whether even at the time of very inception, i.e., at the time the agreement was entered into, there CRL.M.C. No.3893 of 2010 -: 6 :- was any intention on the part of the petitioner to cheat the second respondent as the latter alleges. Merely because certain allegations are made and the words of the Section are reproduced in the complaint it cannot be said that an offence is made out. The factual situation must indicate commission of the offence. Here is a case where there is a building contract between the parties and as per that contract second respondent made the construction. It is not disputed that certain payments were made by petitioner to the second respondent but according to the second respondent, it was not in accordance with terms and conditions of the agreement. The disputed agreement was on 15.02.2006. It is not disputed that certain payments were made to the second respondent even as per cheques dated 01.02.2007 (Annexures-IV & V). 7. It is true that to quash the proceeding normally the documents produced by the accused are not be looked into. But it is not as if this Court is forbidden from looking into the documents produced by the petitioner to decide whether any case is made against him. It is seen from Annexures-IV & V that in the cheques issued to the second respondent it is stated that those cheques are issued in full and final settlement of the labour CRL.M.C. No.3893 of 2010 -: 7 :- contract for construction of building at the agreed rates. 8. I am not going into the question whether even with the said documents it is within the right of second respondent to realize further amount if any due to him as if there is no final settlement as the second respondent would say. Presently I am concerned with the allegations regarding commission of offence under Sec.420 of the IPC. On going though the complaint what I find is a civil dispute between the parties arising from an alleged breach of the terms and conditions of an oral agreement. It is not as if any civil dispute by a clever drafting of the complaint could be converted into a criminal prosecution. Mere incorporation of the ingredients of Section of offence is not sufficient. Materials should disclose commission of an offence. Courts must be careful about such tendency. Having regard to the circumstances stated what is involved is only a civil dispute in which case this Court is justified in interfering with the proceeding under Sec.482 of the Code. I am supported in the above view by the decision in V.Y. Jose and Another v. State of Gujrat and Another ([2009] 3 SCC 78) where it is held that to attract offence under Sec.415 punishable under Sec.420 of the IPC, fraudulent or dishonest intention at the time of CRL.M.C. No.3893 of 2010 -: 8 :- promise or representation is essential and in the absence of culpable intention at the time of making initial promise the charge under Sec.420 of the IPC cannot be sustained. It is also held in that decision that mere breach of contract does not necessarily involve cheating and that a matter which essentially involves dispute of civil nature should not be allowed to become subject matter of criminal proceeding which may be resorted to as a short cut. In view of what I have stated above, prosecution against petitioner cannot be sustained. I make it clear that I have not pronounced verdict on the question whether any further amount is due to the second respondent on account of construction of the building. Resultantly, Criminal Miscellaneous Case is allowed. Annexure-II, final report in Crime No.70 of 2007 of Kanjirappally Police Station, cognizance taken thereon and proceeding in C.C. No.340 of 2007 of the court of learned Judicial First Class Magistrate-I, Kanjirappally against petitioner are quashed. THOMAS P. JOSEPH, JUDGE. vsv