Crl.M.C.88/2011 Page 1 of 50 * IN THE HIGH COURT OF DELHI AT NEW DELHI + Crl.M.C.88/2011 % Judgment reserved on :12th July, 2011 Judgment delivered on:23 August, 2011 AMBIENCE COMMERCIAL DEVELOPERS PVT LTD & ANR ....... Petitioners Through: Mr.Vikas Singh, Senior Advocate with Mr. P. K. Aggarwal, Mr.Rajiv Kapoor and Ms.Mercy Hussain, Advs Versus THE STATE & ANR ....... Respondents Through : Mr. M. P. Singh, APP forR-1 with SI Kumar Kundan, Crime Branch, EOW in person. Mr.Ramesh Gupta, Senior Advocate with Mr.Bharat Sharma, Adv. for R2 CORAM: HON'BLE MR. JUSTICE SURESH KAIT 1. Whether the Reporters of local papers may be allowed to see the judgment? Yes 2. To be referred to Reporter or not? Yes 3. Whether the judgment should be reported in the Digest? Yes SURESH KAIT, J. 1. Vide the instant petition petitioners have challenged the FIR No.77/2008 registered against them under Section 409/420/120B of the Indian Penal Code, 1860 Crl.M.C.88/2011 Page 2 of 50 at Police Station Economic Offence Wing on the complaint lodged by respondent No.2. 2. The facts of the case, in brief, are that on 15.12.2003, the petitioners company purchased a plot bearing No.2, Vasant Kunj Mall Area, New Delhi in open auction by Delhi Development Authority, (herein after referred to as DDA). Thereafter, somewhere in May 2004, respondent No.2/complainant had booked two shops No.G-48 and G-49 in Ambience Mall, Vasant Kunj, New Delhi, developed by the petitioner company vide terms and conditions of the allotment which were contained in the application for allotment. 3. Mr.Vikas Singh, Sr. advocate appearing for the petitioners submits, that as per clause No.7 of the aforesaid application, the lay out plans of the building were tentative and subject to change. In case of increase/decrease of total area, the rate per square feet was applicable to the changed area. 4. He further submits that, as per clause No.48, the application was under investor‟s category, hence, and the Crl.M.C.88/2011 Page 3 of 50 allottee was not allowed to put the space to his own use and authorized the company to give the same on lease. The allottee was only entitled to the rental income. 5. Further it is stated that, due to the change of lay out plans the numbers of the shop were changed to shop Nos.G-42 & G-43 marginally measured little higher (about 6.5%). Accordingly, respondent No.2 was informed vide letter dated 09.06.2005 with regard to the change of numbers and change of area. There was no protest or objection till the civil suit was filed in January, 2008. 6. Ld. Senior counsel further submits that the respondent No.2 for the first time, i.e. few days before filing the civil suit, demanded physical possession on 12.12.2007. 7. On 07.01.2008, the complainant filed a civil suit in this Court being CS(OS) No.38/2008, wherein, vide order dated 09.01.2008, an ex-parte interim order was granted restraining the petitioners from creating a third party interest, or changing the lay out plan of two shops. 8. On 02.05.2008, respondent No.2/complainant lodged a complaint with Economic Offence Wing and same Crl.M.C.88/2011 Page 4 of 50 was registered as FIR No.77/2008, which is for adjudication in the instant case, on the following basis:- “a) The complainant booked two shops in Ambience Mall, Vasant Kunj, New Delhi developed by the petition; b) The complainant had made a payment in the sum of Rs.2,28,98,182/- in respect of the said two shops; c) The petitioners unilaterally changed the number and area of the shops; & d) The petitioners were not delivering possession of the said shops to the complainant and completing the sale.” 9. Further submits that respondent No.2 was desirous to invest money in the project to be developed by the petitioners. Respondent No.2 voluntarily offered to deposit an advance amount with the petitioners to ensure the allocation of space in the said commercial property. More so respondent No.2 was so intrigued with the low prices offered by the petitioner, that he did not deem it fit to wait for the formal launch of the project by the petitioners for the development of the mall. 10. Further submits that against the deposit paid in advance in the month of March and May, 2004, petitioners Crl.M.C.88/2011 Page 5 of 50 after obtaining all necessary clearances allotted two shops to respondent No.2 on 18.08.2004. Thereafter, alongwith the allotment letter, the petitioners also sent detailed „terms and conditions‟ titled as „Salient Terms and Conditions for Allotment of a Commercial Space in “Ambi Mall” at Vasant Kunj Mall Complex, Nelson Mandela Marg, Vasant Kunj, New Delhi. 11. Ld.counsel for petitioners submits that the FIR in question was registered on 02.05.2008, on which even the petitioners did not have the occupancy certificate from DDA. The said certificate was ultimately issued to the petitioners on 27.08.2009 i.e. more than one year after the registration of the said FIR. The terms and conditions which were part of the allotment letter and the application form which are admittedly and duly signed by respondent No.2, clearly provided that the possession will be with the petitioners and they will be at liberty to lease / rent out the said space. This kind of a clause, now a days is commonly available with regard to similar agreements for allotment of spaces in malls so as to ensure proper zoning and quality of brands available in the mall. Crl.M.C.88/2011 Page 6 of 50 12. Further submits that clause Nos.7, 34 and 48 of the terms and conditions which are relevant to the present controversy are reproduced as under:- “Clause No.7. The lay out and building plans displayed at Company‟s office are only tentative plans and the Company shall have right to make such variations, additions, deletions. Alterations, modifications, and changes therein as it may, in its sole discretion deed fit and proper or as may be required/done by any competent authority, which variations/additions/deletions/alternations/ may involve, all or any change/variation in its dimensions are a change/ variation in its area or layout etc. To implement any of the above charges/variations in its area or layout etc. To implement any of the above, changes/variations, supplementary agreement(s), if necessary or called upon by the Seller, will be executed. If there is any increase/decrease in the total area of the Commercial Space was booked. In such event, the Company shall be liable to refund without interest only the extra price and the other proportionate charges recovered or shall be entitled to recover the additional price and other proportionate charges without interest, as the case may be. If for any reason, the Company is not in a position to allot the Commercial Space applied for, in that case, the Company shall refund the amount deposited with it by the intending allottee with simple interest @ 6% per annum, calculated upto the date of refund in full and final settlement of all claims of the intending allottee. Thus, the total price of the said Crl.M.C.88/2011 Page 7 of 50 Commercial Space and other charges shall be calculated and payable on the basis of the total area arrived at as per final dimensions of the said Commercial Complex and Space on completion of the said Commercial Complex and Building as per terms, pattern and manner specified herein and in the Commercial Space Buyers‟ Agreement. Clause No.34. The Company shall endeavour to complete the construction of the said Commercial Complex within a period of 03 years from the date of execution of the Commercial Space Buyer‟s Agreement, subject to timely payment by the intending allottee of sale price, stamp duty and other charges due and payment according to the Payment Plan applicable to him or as demanded by the Company. The Company after obtaining certificate for occupation and use from the competent authorities shall hand over the Commercial Space to intending allottee for his occupation and use and subject to the intending allottee having complied with all the terms and conditions specified herein and in the Commercial Space Buyer‟s Agreement. In the event of his failure to take over and/or occupy and use the Commercial space allotted to him within thirty (30) days from the date of intimation in writing by the Company, then the same shall like at his risk costs and the intending allottee shall be liable to pay to the Company holding charges @ Rs.25/- per feet of the super area per month for the period of such delay. If the Company fails to complete the construction of the aid complex within 03 years as aforesaid except the reason specified herein and in Commercial Space Buyer‟s Agreement, then the Crl.M.C.88/2011 Page 8 of 50 Company shall pay to the intending allottee compensation @ Rs.25/- per sq.ft of the super area per month for the period of such delay provided the intending allottee has paid all the dues to the company as per payment plan. The adjustment of holding charges or compensation shall be done at the time of conveying of the Commercial Space and not earlier. The holding charges shall be a distinct charge in addition to maintenance charges and not related to any other charges as provided in the application and Commercial Space Buyer‟s Agreement. However, in case the intending allottee has already made the full payment of price and other charges to the Company, then the intending allottee(s) shall be deemed to have taken possession of the said Commercial Space and he shall be liable to pay to the Company any expenditure regarding the caretaking/ maintenance or any other charges of the said Commercial Space from that date onwards over and above the holding charges as above. Clause No.48. The company shall be entitled to define and prescribe the zoning and usage of the said space. The space shall be used only for the specified purpose. The applicant is applying under the Investor‟s category and would not put the space to his own use and authorizes the company to give the same on lease/license, to any person in its sole discretion and on the terms and conditions agreed to by the company at any annual rental not less than 9% of the investment made by the intending allottee. Subsequent lease/ license renewal shall also be done by the company. Intending allottee agrees to execute and get registered all such documents as the Crl.M.C.88/2011 Page 9 of 50 Company may desire. The intending allottee shall not transfer the space to any person without the consent in writing of the company. In case of refusal, the company shall have option to repurchase the same at the then prevailing/applicable rate as determined by the company. This clause is the essence of the Contract. In case of any breach, the allotment shall stand determined and the intending allottee shall be entitled to refund of the amounts paid by him after forfeiting of the earnest money etc. and the company shall have right to re-enter the said commercial space or to stop the supply of essential services including electricity and water to the said commercial space till it is restored into its prescribed used.” 13. Admittedly respondent No.2, while accepting the allotment, signed on the terms and conditions provided to the respondent No.2 at the time of allotment. 14. The case of the respondent No.2 is that while signing the said terms and conditions, he did not read the clauses thereof. No allegations, whatsoever have been made out by respondent No.2 for any efforts made by them so as to prevent respondent No.2 from reading the terms and conditions. 15. Ld.counsel for petitioners further submits that as per as the clauses quoted above, it was clear that the area Crl.M.C.88/2011 Page 10 of 50 allotted was tentative and was likely to change and also that the possession was to be given on completion as per clause 34. Vide clause 48 it was specified as under:- “Applicant is applying under the investor category and would not be entitled to a minimum rental not less than 9% of the investment made.” 16. It is submitted that clause No.48 clearly provided that it was the essence of the contract that in case of any breach, the allotment shall stand determined and the intending allottee shall be entitled to refund of the amounts after forfeiting the earnest money and the company shall have the right to re-enter the said commercial space or to stop the supply of essential services, including electricity and water till it is restored into its prescribed used. 17. It is further submitted that clause No.34 provides that although the possession was to be given for the use of the applicant, but the use was specified in clause No.48, the applicant would not put the space to his own use and authorised the company being the same on lease/licences to any person in its sole discretion. Crl.M.C.88/2011 Page 11 of 50 18. Ld.Sr.Advocate further submits that as per the above mentioned clauses, respondent No.2, is the applicant for the said commercial space, who became dishonest after signing the salient terms and conditions for allotment and was looking for an excuse to circumvent clause 48, which was agreed to and voluntarily signed by him. In the terms and conditions by contending inter alia that the applicant was entitled to the delivery of the possession for using the space for himself. 19. Ld counsel for the petitioners submits that the applicant in this behalf filed a civil suit in this Court being CS(OS) No.38/2008 and prayed for the following reliefs. “(a) For a decree of declaration in favour of the plaintiff and against the defendant No.1 declaring that the action of the defendant No.1 in revising payment plan in shop Nos.G-48 and G- 49 (new Nos.G-42 & G-43) at the ground floor at Ambi Mall, Plot No.2, Vasant Kunj, Nelson Mendela Marg, New Delhi are null and void, having no existence in the eyes of law. (b) granting decree of permanent perpetual injunction in favour of the plaintiff and against the def No.1 restraining the defendant No.1, its directors, employees, officials, agents, representatives, attorney, successors, servants or anyone acting on its behalf from allottee Crl.M.C.88/2011 Page 12 of 50 Ground Floor Shop Nos.G-48 and G-49 (new Nos.G-42 & G-43) in Ambi Mall, Plot No.2, Vasant Kunj, Nelson Mandela Marg, New Delhi to any person other than the plaintiff and further for a permanent perpetual decree for restraint/ prohibition against the defendant No.1 company from handing over possession of any other commercial space/shop in Ambi Mall at plot No.2, Vasant Kunj, Vasant Vihar, New Delhi of the defendant No.1 to any other allottee till such time vacant peaceful possession of the said shop Nos.G-48 and G-49 (new Nos.G-42 & G-43) is handed over by the defendant No.1 company to the plaintiff and further order restraining the defendant No.1 or anyone acting for an on its behalf from in any manner carrying on any further constructions, alterations, interior work, etc. at Ambi Mall, Plot No.2, Vasant Kunj, Nelson Mendela Marg, New Delhi. (c) granting decree of mandatory injunction against the defendant No.1 and in favour of the plaintiff for the execution and delivery of space buyers agreement. (d) granting decree of specific performance in favour of the plaintiff and against the defendant No.1 of the allotment letter dated 18.08.204 and the execution of ownership and transfer documents in favour of the plaintiff for the said shop Nos.G-48 and G-49 (new Nos.G-42 & G-43) and for handing over of the possession of the said shops at Ambi Mall, Plot No.2, Vasant Kunj, Nelson Mendela Marg, New Delhi. Crl.M.C.88/2011 Page 13 of 50 (e) Awards costs including exemplary costs for the present proceedings, in favour of the plaintiff and against the defendant No.1; and (f) any further or other order(s) which this Hon‟ble Court may deem fit and proper in favour of the plaintiff, in the facts and circumstances of the case, be passed. 20. Ld.counsel for the petitioners has argued that the respondent No.2 in „prayer (b)‟ of the suit had prayed for possession; no issue with regard thereto was framed in the suit. The said suit has been decreed in favour of respondent No.2 with some observations against petitioner No.1, but no decree for possession has been passed in favour of the respondent No.2. 21. Further submits that, it is relevant and pertinent to mention that while decreeing the suit, this Court directed the petitioner to execute “Commercial Space Buyer‟s Agreement”. The said agreement also contained clause Nos.7, 34 & 48 which provided that no possession had to be handed over to the respondent No.2. 22. Ld.Single Judge has further held that, the injunction is to continue only till the compliance of the directions i.e. the execution of “Commercial Space Buyer‟s Crl.M.C.88/2011 Page 14 of 50 Agreement”. Therefore, after execution of the said agreement, the petitioner would be at liberty to lease out/rent out the said space in terms of the “Commercial Space Buyer‟s Agreement” which provides for 9% return in terms of the clause No.48; that no possession has to be handed over to the respondent No.2 and the petitioner would be at liberty to deal with the space allotted in terms of the clause No.48 after the execution of the “Commercial Space Buyer‟s Agreement”. 23. Ld.counsel for the petitioners has submitted that with a view to harass and blackmail the petitioners and to further create criminal proceedings in regard to civil dispute, which is covered by admitted terms and conditions of a contract, respondent No.2 appears to have filed a complaint dated 02.05.2008 (i.e. after about five months of filing of the suit) and the present FIR No.77/2008. 24. Further submits that the only allegation against the petitioners is that, they had become dishonest and were not handing over the possession of the said shops to the respondent No.2/complainant. The respondent No.2 had Crl.M.C.88/2011 Page 15 of 50 himself signed the terms and conditions, wherein he had categorically agreed that he was applicant under the investors category and was not entitled to use the space for himself and secondly, on the date of the FIR, the occupation certificate had not been handed over to the petitioners by DDA and hence there was no question of handing over the physical possession to the respondent No.2/complainant. 25. It is submitted that the FIR is clearly an attempt to put pressure and to arm-twist the petitioners, to somehow wriggle out of the effect of clause No.48 in order to illegally take possession of the commercial space by respondent No.2; when clearly as per the said clause, any attempt by respondent No.2, resiled from the said clause would tantamount to termination of the allotment itself and respondent No.2/complainant would only be entitled to refund of the deposit made by him after taking the earnest money paid by the respondent No.2/complainant. Thus, the FIR was a dishonest attempt by respondent No.2/complainant to escape from the terms of the allotment and to seek something which was clearly barred under the same. Crl.M.C.88/2011 Page 16 of 50 26. Ld.senior counsel further submits that the FIR is an abuse and misuse of process of law with a view to pressurise the petitioner and to succumb to the illegal and illegitimate demands of respondent No.2/complainant. Respondent No.2 had tried to instigate other persons, however all other persons have realised and know the terms and conditions and have amicably settled and resolved the matter with the petitioners. 27. It is stated, the petitioners have not handed over actual physical possession to a single allottee in view of clause 48 of the terms and conditions and no court has till date directed handing over possession to any allottee. Further submits that clearly the “Commercial Space Buyer‟s Agreement” is strictly in line with the terms and conditions enumerated alongwith the applicant letter and hence the decree of the ld.Single Judge in favour of respondent No.2 is merely a paper-decree. 28. In support of the aforesaid submissions, ld.counsel has relied upon the decision in the case of State of Haryana & Ors Vs. Bhajan Lal, 1992 Supp (1) SCC Crl.M.C.88/2011 Page 17 of 50 335 which lays down the principles under which the FIR can be quashed. One of the principle is – „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. 29. Recent judgment of the Supreme Court confronting the view taken in the case of Bhajan Lal (supra) regarding quashing of the FIR in case of Rajeswar Tiwari & Ors Vs. Nanda Kishore Roy 2010 (8) SCC 422 wherein in para No.31 it was held as under: “31. In State of Haryana V. Bhajan Lal 1992 Supp (1) SCC 335, a question came for consideration as to whether quashing of the FIR filed against the respondent Bhajan Lal for the offences under Section 161 and 165 IPC and Section 5(2) of the Prevention of Corruption Act was property and legal. Reversing the order passed by the High Court, this Court explained the circumstances under which such power could be exercised. Apart from reiterating the earlier norms laid down by this Court, it was further explained that such power could be exercised where allegations made in the FIR or complaint are so absurd and inherently improbably on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding Crl.M.C.88/2011 Page 18 of 50 against the accused. No doubt, at the stage of quashing an FIR or complaint, the High Court is not justified in embarking upon an inquiry as to the probability, reliability or genuineness of the allegations made therein.“ In Madan Mohan Singh Vs. State of Gujarat & Another 2010 (8) SCC 628 wherein in para No.17 it was held as under: “17. We have already explained that the baseless and irrelevant allegations could not be used as a basis for prosecution for a serious offence under Section 306 IPC. Similarly, we have already considered Section 294(b) IPC also. We have not been able to find anything. Under such circumstances, where the FIR itself does not have any material or is not capable of being viewed as having material for offences under Section 306 and 294(b) IPC, as per law laid down by this Court in State of Haryana V Bhajan Lal 1992 Supp (1) SCC 335, it would be only proper to quash the FIR and the further proceedings.” In R.Klayani Vs. Janak C. Mehta & Ors 2009 (1) SCC 516 wherein in para Nos.15 & 16 it was held as under: “15. Propositions of law which emerge from the said decisions are: (1) The High Court ordinarily would not exercise its inherent jurisdiction to quash a criminal proceeding and, in particular, a first information report unless the allegations contained therein, Crl.M.C.88/2011 Page 19 of 50 even if given face value and taken to be correct in their entirety, disclosed no cognizable offence. (2) For the said purpose the Court, save and except in very exceptional circumstances, would not look to any document relied upon by the defence. (3) Such a power should be exercised very sparingly. If the allegations made in the FIR disclose commission of an offence, the Court shall not go beyond the same and pass an order 9 in favour of the accused to hold absence of any mens rea or actus reus. (4) If the allegation discloses a civil dispute, the same by itself may not be a ground to hold that the criminal proceedings should not be allowed to continue." 16. It is furthermore well known that no hard and fast rule can be laid down. Each case has to be considered on its own merits. The Court, while exercising its inherent jurisdiction, although would not interfere with a genuine complaint keeping in view the purport and object for which the provisions of Sections 482 and 483 of the Code of Criminal