Case: Kapil Agarwal and others Vs. Sanjay Sharma and others

2. The relevant facts necessary for deciding the present appeal are as under:That one M/s Varun Beverages Ltd. (for short, VBL) is a licensed franchisee of PepsiCo India Pvt. Ltd. and engaged in the manufacture and sale of carbonated sweetened water, fruit juice, packaged drinking water under the PepsiCo brand. That in the year 2013, the VBL appointed the firm of the complainant – Sanjay Sharma as a Distributor in the area of Loni, District Ghaziabad to sell and distribute the products manufactured by the company. That in the year 2014, the company terminated the contract of distributorship, which according to the appellants was due to non-payment of dues by respondent no.1 herein – original complainant. According to the appellants, thereafter on reconciliation of accounts and as per the statement of accounts maintained by the company, after adjusting of all claims and security deposit, a sum of Rs.9,46,280/- was found to be outstanding upon the complainant, towards the material supplied to him. The complainant issued a cheque dated 15.09.2014 in favour of the company – VBL. The said cheque was presented for encashment on 22.09.2014. The same was dishonoured and returned unpaid by the banker of the complainant due to insufficient funds. That thereafter, due to non-payment after the issuance of the statutory legal notices, appellants herein filed a criminal complaint under Section 138 of the Negotiable Instruments Act on 07.11.2014 against R1 and his company Thakur Trading, in the Court of Chief Judicial Magistrate, Ghaziabad being Complaint Case No. 7652/2014. R1 has been summoned to face the trial. The said complaint is presently pending for disposal. R1 filed a complaint against one of the officers of the company-VBL being FIR No. 1565/2014 dated 15.09.2014 alleging misappropriation of Rs.6,00,000/- by one of the officers of the company, namely, Vipul Verma. That after investigation by the police, the investigating officer submitted a negative final report No. 47/2015 dated 20.01.2015.2.1 R1 also filed one another case on 09.02.2015 for misappropriation of Rs.31,12,375/- by the appellants. That thereafter R1 filed a complaint/application under Section 156(3) Cr. P.C. in the Court of learned Additional Chief Judicial Magistrate-I, Ghaziabad for issuance of direction to the Police Station Loni to register FIR against the appellants herein and two other officers of the company alleging misappropriation of an amount of Rs.31,12,375/-. The learned Magistrate, instead of directing the police to register FIR, decided to enquire into the matter by treating the same as a complaint case. That vide order dated 23.03.2015, the learned Magistrate treated the application of R1 under Section 156(3) Cr.P.C. as a complaint case and an opportunity was granted to R1 to record his statement under Section 200 Cr.P.C.2.2 Feeling aggrieved by order dated 23.03.2015 treating the application under Section 156(3) Cr.P.C. as a complaint case, R1 filed a criminal revision application No. 70/2015 before the learned Sessions Court, Ghaziabad. That the learned Sessions Judge, Ghaziabad allowed the said revision application and quashed and set aside order dated 23.03.2015 passed by the learned Magistrate and remanded the matter back to the learned Magistrate to consider the material on record and pass speaking order afresh for assigning reasons for considering application under Section 156(3) Cr.P.C. as a complaint case. That thereafter the learned Magistrate sought an action report from the concerned police station. That the concerned police officer submitted the report before the learned Magistrate on 09.08.2015. That the said proceedings are pending before the learned Magistrate.2.3 That after a period of approximately two years, R1 lodged the impugned FIR against the appellants for the offences under Sections 406/420 IPC at Police Station Loni, District Ghaziabad, dated 4.8.2017. The allegations in the said FIR are same/similar to the allegations levelled in the application under Section 156(3) Cr.P.C., which is pending consideration before the learned Magistrate since 2015.At this stage, it is required to be noted that the said FIR is filed against Kapil Agarwal, appellant No.1 – Director, Sharad Garg, appellant No.2 – Multi Unit Manager and Deepak Sharma, appellant No.3 – Sales Head. That thereafter the appellants approached the High Court under Article 226 of the Constitution of India being Criminal Miscellaneous Writ Petition No. 18308 of 2017 for quashing the aforesaid FIR being Case Crime No. 790 of 2017, under Sections 420/406 IPC, Police Station Loni Border, District Ghaziabad. By the impugned judgment and order, the High Court has refused to quash the FIR observing that the impugned FIR, prima facie, discloses commission of cognizable offence.2.4 Feeling aggrieved and dissatisfied with the impugned judgment and order passed by the High Court refusing to quash the FIR being Case Crime No. 790 of 2017, under Sections 420/406 IPC, Police Station Loni Border, District Ghaziabad, the original accused have preferred the present appeal.

Court's reasoning:
The aforesaid cannot be accepted for the simple reason that Code of Criminal Procedure permits such an eventuality of a complaint case and enquiry or trial by the Magistrate in a complaint case and an investigation by the police pursuant to the FIR.Thus, as per Section 210 Cr.P.C., when in a case instituted otherwise than on a police report, i.e., in a complaint case, during the course of the inquiry or trial held by the Magistrate, it appears to the Magistrate that an investigation by the police is in progress in relation to the offence which is the subject matter of the inquiry or trial held by him, the Magistrate shall stay the proceedings of such inquiry or trial and call for a report on the matter from the police officer conducting the investigation. It also provides that if a report is made by the investigating police officer under Section 173 Cr.P.C. and on such report cognizance of any offence is taken by the Magistrate against any person who is an accused in the complaint case, the Magistrate shall inquire into or try together the complaint case and the case arising out of the police report as if both the cases were instituted on a police report. It also further provides that if the police report does not relate to any accused in the complaint case or if the Magistrate does not take cognizance of any offence on the police report, he shall proceed with the inquiry or trial, which was stayed by him, in accordance with the provisions of Cr.P.C.Thus, merely because on the same set of facts with the same allegations and averments earlier the complaint is filed, there is no bar to lodge the FIR with the police station with the same allegations and averments.6. However, at the same time, if it is found that the subsequent FIR is an abuse of process of law and/or the same has been lodged only to harass the accused, the same can be quashed in exercise of powers under Article 226 of the Constitution or in exercise of powers under Section 482 Cr.P.C. In that case, the complaint case will proceed further in accordance with the provisions of the Cr.P.C.6.1 As observed and held by this Court in catena of decisions, inherent jurisdiction under Section 482 Cr.P.C. and/or under Article 226 of the Constitution is designed to achieve salutary purpose that criminal proceedings ought not to be permitted to degenerate into weapon of harassment. When the Court is satisfied that criminal proceedings amount to an abuse of process of law or that it amounts to bringing pressure upon accused, in exercise of inherent powers, such proceedings can be quashed.6.2 As held by this Court in the case of Parbatbhai Aahir v. State of Gujarat (2017) 9 SCC 641 ,  Section 482 Cr.P.C. is prefaced with an overriding provision. The statute saves the inherent power of the High Court, as a superior court, to make such orders as are necessary (i) to prevent an abuse of the process of any Court; or (ii) otherwise to secure the ends of justice. Same are the powers with the High Court, when it exercises the powers under Article 226 of the Constitution.7. Applying the law laid down by this Court, referred to hereinabove, to the facts of the case on hand, subsequent FIR filed by the respondent – original complainant can be said to be an abuse of process of law and the same to be bringing pressure on the accused, which can be demonstrated from the following facts:i) cheque no. 038611 was presented for encashment and the same came to be dishonoured by the banker of the complainant due to insufficient funds;ii) that the company – VBL served statutory legal notices upon the complainant under the provisions of the Negotiable Instruments Act;iii) that thereafter complaint under Section 138 of the Negotiable Instruments Act has been filed by the company against the respondent-original complainant on 7.11.2014;iv) that thereafter, after a period of three months, respondent no.1 filed an application under Section 156(3) Cr.P.C. seeking registration of FIR against the appellants herein, i.e., in the month of February, 2015;v) the learned Magistrate declined to order registration of FIR, but decided to inquire into the matter by treating the same as complaint case and granted respondent no.1 – original complainant an opportunity of recording solemn affirmation under Section 200 Cr.P.C. (order dated 23.03.2015). Order dated 23.03.2015 came to be set aside by the learned Sessions Judge vide order dated 8.7.2015 and the matter was remanded to the learned Magistrate with directions to pass a speaking order. The same is pending before the learned Magistrate;vi) that thereafter after a period of two years, R1 lodged the impugned FIR against the appellants with police station Loni Border, District Ghaziabad with the similar contents and allegations which were levelled in the application under Section 156(3) Cr.P.C. In the FIR, the date of occurrence of the offence has been shown as 26.07.2017;vii) it appears that R1 is not proceeding further with his application under Section 156(3) Cr.P.C., which is pending before the learned Magistrate since last five years;viii) in the FIR, neither there is any reference to the application under Section 156(3) Cr.P.C. which is pending before the learned Magistrate, nor there is a reference of the complaint under Section 138 of the NI Act.Under the circumstances, the impugned FIR is nothing but an abuse of process of law and can be said to be filed with a view to harass the appellants.8. We are not expressing anything on merits whether, any case is made out against the appellants for the offences alleged in 156(3) Cr.P.C. application as the same is pending before the learned Magistrate and the learned Magistrate is to take call on the same. Therefore, when the impugned FIR is nothing but an abuse of process of law and to harass the appellants-accused, we are of the opinion that the High Court ought to have exercised the powers under Article 226 of the Constitution of India/482 Cr.P.C. and ought to have quashed the impugned FIR to secure the ends of justice.