Delhi High Court

Vikramjit Singh & Anr. vs The State Of Nct Of Delhi & Anr. on 17 October, 2022

Author:
Purushaindra Kumar Kaurav

Bench:
Purushaindra Kumar Kaurav

Neutral Citation Number 2022/DHC/004639

$~
* IN THE HIGH COURT OF DELHI AT NEW DELHI
BEFORE
HON'BLE MR. JUSTICE PURUSHAINDRA KUMAR KAURAV
+ CRL.M.C. 4189/2022 & CRL. M.As.17220/2022 & 17221/2022

BETWEEN:-
VIKRAMJIT SINGH
S/O BHAI MANJIT SINGH
R/O 68, JOR BAGH, NEW
DELHI - 110003 ..... PETITIONER NO.1

MAHEEP MANJIT SINGH
W/O BHAI MANJIT SINGH
R/O 110, SUNDER NAGAR
NEW DELHI - 110003 ..... PETITIONER NO.2

(Through: Mr. Siddharth Aggarwal, Senior Advocate with Mr.
Karan Khanuja, Mr. Harsh Yadav and Mr. Vikram
Panwar, Advocates)

AND
THE STATE OF NCT OF DELHI
THROUGH THE STANDING COUNSEL,
HON'BLE HIGH COURT OF DELHI
NEW DELHI -- 110003 .... RESPONDENT NO.1

MR. PUNIT BERIWALA (COMPLAINANT)
S/O MR. S.S. BERIWALA
R/O 15/10, SARVAPRIYA VIHAR,
NEW DELHI- 110016 .... RESPONDENT NO.2

(Through: Mr. Utkarsh, APP for State.
Mr. Dayan Krishnan, Senior Advocate along with
Mr. Lokesh Bhola, Mr. Sarojanand Jha and Ms.
Deepa Chansotia Advocates for R-2).
[2]

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% Pronounced on : 17.10.2022

J U D G M E NT

PURUSHAINDRA KUMAR KAURAV, J.

1. By way of the present petition under
Section 482
of the Code of
Criminal Procedure, 1973 (in short, „
Cr.P.C
‟), the petitioners seek
quashing of FIR No.94 of 2022 registered at Police Station Economic
Offences Wing, Mandir Marg, New Delhi for offences punishable under

Section 467
/
/
/
/
120B
of the Indian Penal Code (in short, the

IPC
) and all criminal proceedings emanating therefrom.

2. On 16.06.2022, FIR in question came to be registered on a written
complaint made by Mr. Punit Beriwala S/o Mr. S.S. Beriwala,
respondent No.2 herein (who is called "the complainant"). Besides
others, the FIR is also against the present petitioners, who are the son and
wife of one Bhai Manjit Singh. Bhai Manjit Singh is also an accused in
the instant FIR. It is, thus, seen that the father of petitioner No.1 and
husband of petitioner No.2, Bhai Manjit Singh, is the main accused in the
instant FIR. There are two other accused, namely, SREI Infrastructure
Finance Ltd. and SREI Equipment Finance Ltd., which are stated to be
financial institutions. Bhai Manjit Singh has also been arrayed as accused
in the capacity of being Karta of the Hindu Undivided Family (in short,
„HUF‟). It is, thus, seen that there are six accused in the FIR. Bhai Manjit
Singh in the capacity of HUF Karta is accused No.1, Bhai Manjit Singh
in his personal capacity is accused No.2, Maheep Manjit Singh W/o Bhai
Manjit Singh is accused No.3 (petitioner No.2) and Vikramjit Singh

[3]

(petitioner No.1) is accused No.4. Accused No.5 and 6 are SREI
Infrastructure Financial Ltd. and SREI Equipment Ltd., respectively. The
petitioners are being referred here according to their number as accused
in the FIR. Since the present petition is filed by accused No.3 - Maheep
Manjit Singh and accused No.4 - Vikramjit Singh, therefore, the matter
is being dealt only with respect to the two accused. The gravamen of the
allegation in the FIR is as under:

(i) Accused No.1 is a HUF by name of Bhai Manjit Singh of which,
accused No.2, accused No.3 and accused No.4 are the coparceners.

(ii) Accused No.1 is the owner of the property bearing No.28-A
Prithviraj Road, New Delhi admeasuring 3727 sq. yards.

(hereinafter referred to as „property in dispute‟).

(iii) In the year 2004, accused No.2 - Bhai Manjit Singh approached
the complainant being Karta of accused No.1 with an offer to sell
the property in dispute to the complainant. Accused No.2
represented and assured that other family members of the accused
No.1 have also extended an offer to sell the property in dispute to
the complainant and it was told that the property in dispute is free
from all kinds of encumbrances.

(iv) After negotiation between the complainant and the accused No.1
to 4, it was agreed that the total sale consideration of the property
in dispute shall be Rs.28 crores. The property in dispute was stated
to be leasehold, therefore, parties agreed for the payment of total
sale consideration in parts. Accused Nos.1 to 4 had undertaken to
get the property in dispute freehold from the Land and
Development Office. It was also agreed that the complainant

[4]

would make some payments as earnest money till the time accused
Nos.1 to 4 get the said property freehold from the Land and
Development Office. Between 12.04.2004 to 03.01.2005 against
various receipts, a total sum of Rs.1,64,50,000/- was paid to the
accused No.1. The role attributed to accused No.3 and 4 i.e.,
petitioners herein is that they have signed as witnesses in the
aforesaid receipts. The possession of part premises of the property
in dispute i.e., servant quarter was handed over to the complainant
vide letter of possession dated 22.04.2004.

(v) Accused No.1 to 4 had assured that they would transfer the
property to the complainant after obtaining all permissions and
making payments to various authorities in order to freely transfer
the property in dispute to the complainant.

(vi) In June 2020, accused No.2 is stated to have approached the
complainant stating that the title of the property in dispute is clear
from all encumbrances and, therefore, the complainant should
make the payment of balance consideration so that the title of the
property in dispute can be transferred in the name of the
complainant.

(vii) The complainant requested the accused Nos.1 to 4 to show the
documents to indicate that the property in dispute is clear from all
encumbrances. Since no documents were provided, therefore, the
complainant observed some mala fide behaviour, hence, he issued
a public notice on 18.07.2020 in the newspaper „Hindustan Times‟
declaring to the public at large his agreement with respect to the
property in dispute with accused No.1 to 4.

[5]

(viii) Pursuant to aforesaid public notice, an objection letter dated
20.07.2020 was received on behalf of Punjab and Sindh Bank,
Rajendra Place, New Delhi, SREI Infrastructure Finance Ltd., and
SREI Equipment Finance Ltd. staking claim over the property in
dispute, wherein, it was stated that the said property had been
mortgaged by the accused No.2 for securing the loan granted to
one borrower company, namely, Montari Industries Ltd. That
apart, two other objections vide letters dated 22.07.2020 were also
received by the complainant from the accused Nos.5 and 6, stating
therein that the property in dispute is mortgaged with them as well.
Besides, the objections as stated above, another objection letter
dated 23.07.2020 was also received from accused No.1 itself by
the complainant, denying the agreement between the accused No.1
and complainant for the sale of the said property in dispute and the
accused No.1 sought the production of documents from the
complainant.

(ix) As per the allegation in the FIR, it is only on 23.07.2020, that
accused Nos.1 to 4 for the first time refused to perform their
obligation to conclude the sale transaction of the property in
dispute. There were various correspondences between the
complainant and the accused and the complainant also filed a civil
suit [CS (OS) 598 of 2021] before this court. However, on
02.12.2021, the complainant could get the copy of the sale deed
whereby, accused No.1 sold the property in dispute to JK Paper
Ltd., wherein, it was disclosed to him that under a Memorandum
of Family Settlement dated 10.03.2000, accused No.2 resigned as
Karta of accused No.1 and transferred all rights, claims, title and

[6]

entitlements in favour of remaining members of the HUF and the
accused No.4 was recognized as Karta of accused No.1.

(x) As per the complaint, accused No.2 in the capacity of Karta of
accused No.1 signed and delivered various receipts for a sum of
Rs.1,64,50,000/- towards part consideration for the purchase of
property in dispute and accused Nos. 3 and 4 had signed as
witnesses to the said receipts issued in favour of the complainant
which clearly indicated that accused Nos.3 to 4 have jointly misled
the complainant to enter into an oral agreement to purchase the
said property from the accused No.1, thereby, grabbing and
siphoning off the hard-earned money of the complainant.

(xi) The complainant after perusal of the sale deed also came to know
that accused No.1 executed the Mortgage Deed dated 04.01.2019
in favour of the accused No.5. Accused No.1 also deposited the
title deeds of the property in dispute with accused No.6 as security
against the credit facility for an amount of Rs.87,00,00,000/-
availed by the ADIZAA Investment Pvt. Ltd.

(xii) It is, alleged in paragraph No.44 of the FIR that the accused had
committed fraud against the complainant to the tune of
Rs.6,67,87,000/- alongwith interest calculated up-to-date @ 18%
per annum w.e.f. 03.01.2005. It is the allegation that the accused
had acted dishonestly thereby causing wrongful loss to the
complainant and wrongful gain to themselves. The accused have
committed an offence of cheating and dishonestly inducing
delivery of property. They have also committed an offence of

[7]

dishonest misappropriation of the property apart from the
commission of an offence of criminal breach of trust.

3. The petitioners as stated above who are accused Nos.3 and 4 i.e.,
wife and son of the accused No.2, respectively have filed this petition for
quashing of FIR and all the proceedings emanating therefrom on various
grounds.

4. This petition was taken up for hearing by this court on 31.08.2022
and after considering the averments made in the petition, notices were
directed to be issued to the Respondents. Respondent No.2 through his
counsel accepted the notice. Respondent No.2 sought time to file the
reply. On prayer made by the petitioners for considering the grant of
interim relief, this court, after consideration of the matter, directed the
respondent to file the reply within seven days and subject to cooperation
by the petitioners, their arrest has been stayed. On 15.09.2022, the parties
undertook to file written synopsis with relevant judgments so that the
matter could be heard finally and, accordingly, this petition came up for
hearing on 22.09.2022 and on that date, the arguments on behalf of the
parties were heard for final disposal.

5. Respondent No.2/complainant filed his reply and the substance of
the reply is as under:

(i) The accused have deceived the complainant into believing that the
accused No.2 is the Karta of accused No.1. The accused
dishonestly induced the complainant to part with his hard-earned
money in the year 2004-05 to the tune of Rs. 1,64,50,000/- and
entered into an Agreement to Sell with the complainant with

[8]

respect to property in dispute and hence, an offence punishable
under
Section 420
of the IPC is prima facie made out.

(ii) Since the accused dishonestly misappropriated the amount paid to
them and finally refused to honour the Agreement to Sell with
respect to the property in dispute and, therefore, the act of the
accused is clearly punishable under
Section 406
of the IPC.

(iii) Accused persons are in the habit of committing offences. One Mr.
Ashok Gupta was also subjected to misrepresentation, who had
disbursed consideration of Rs.4,30,00,000/- to the accused Nos.1
and 2 in the year 2010-11.

(iv) It is stated in the reply that the property in dispute was mortgaged
to various banks in order to avail loan and hence, the accused are
habitual offenders who had defrauded various people by showing
dreams to own the property in dispute.

(v) An FIR No.105 of 2016 dated 24.06.2016 was also got registered
by Mr. Ashok Gupta at Police Station E.O.W, Delhi, against the
accused No.1 to 4. The said FIR, however, came to be quashed
vide order dated 13.02.2019 in W.P.C.(Crl) No.465/2019 by this
court on the basis of an amicable settlement entered into between
Ashok Gupta and accused Nos.1 to 4.

(vi) It is stated that on 22.08.2022, the accused No.1 lodged an FIR
No.128/2022 at Police Station Tuglaq Road, New Delhi alleging
therein that receipts of the amount are forged, whereas, he did not
utter even a single word in his reply dated 23.07.2022 sent by him
on behalf of the Bhai Manjit Singh (HUF). The averments made in

[9]

the FIR are contrary to the ones made in Civil Suit (OS)
No.598/2021 and FAO (OS) No.20/2022.

(vii) The petitioners i.e., accused No.3 & 4 have not joined the
investigation. The change of Karta from Bhai Manjit Singh to
accused No.4/petitioner No.1, was never intimated to the
complainant. The complainant was sincerely and patiently waiting
for the accused persons to obtain all NOCs to ensure that the
property in dispute becomes free from all incumbrances and,
therefore, no delay can be attributed to the complainant. The delay
is not material in taking criminal proceedings for the offences
alleged in the FIR.

(viii) There are cross FIRs. They need proper investigation as in one FIR
accused No.2 himself is alleging that the receipts in question are
forged which is contrary to his own reply and documents. In the
present FIR, it was alleged that the accused No.2 has induced the
complainant while describing himself to be Karta of accused No.1,
whereas, the accused No.2 had already resigned from being Karta
of the family on 02.05.2000 itself. Since this fact has been
discovered only after perusal of the sale deed dated 02.12.2021,
therefore, it cannot be said that there is any delay in lodging the
instant FIR. It is thus, stated in the instant reply that there is no
substance in the petition, therefore, the same deserves to be
dismissed.

6. Respondent No.1/EOW has also filed its reply/Status report stating
therein that during the investigation, it was found that accused No.1 to 4
have also cheated another person Ashok Gupta on the pretext of the sale

[10]

of the same property and, therefore, they are habitual cheaters. The
notice under
Section 91
of the Cr.P.C. was issued to the accused to
supply relevant documents to confirm payment and their signatures were
sought to be obtained. It is also stated that the investigation of the case is
at the initial stage. The reply of the accused is being analyzed and further
investigation is in progress.

7. The learned senior counsel appearing on behalf of the petitioners
submits that there is no agreement entered into between the parties for
the sale of the property in dispute and it is unbelievable to accept the
allegation that the payment of such a hefty amount was made, as part
consideration, without recording any written agreement. There is a delay
of about 17 years in the registration of the FIR and the delay has not been
explained in any manner whatsoever. There is not a single letter, e-mail,
WhatsApp message, or text exchanged between the complainant and the
accused No.2 between 2005 and 2020 enquiring about the status of the
property in dispute and the complete silence on the part of the
complainant speaks volumes about the correctness of the allegations.
Even if entire allegations made in the FIR are taken at their face value as
correct, no offence as alleged is made out against the petitioners. No
offence of cheating is made out. The dispute, at best, is purely of civil
nature, which has been given a criminal colour to arm-twist the
petitioners. There is no allegation of forgery.
The E.O.W. does not have
any right to register an FIR for an offence where the pecuniary limit is
less than three crores. The FIR No.105/2016 lodged by Ashok Gupta is
already quashed and rather respondent No.2 is a habitual offender against
whom FIR No.40 of 2018 is pending at E.O.W apart from FIR
No.2000/2013 at the same Police Station. Besides that, respondent No.2

[11]

is also placing reliance on the notice under
Section 8(6)
of Security
Interest (Enforcement Rules 2002) read with
Securitization and
Reconstructing of Financial Assets and Enforcement of Security Interest
Act
. The learned senior counsel places reliance on the decisions of the
Hon‟ble Supreme Court in the matters of
Prof. RK Vijayasarathy v.
Sudha Seetharam1
, VY Jose v. State of Gujarat2,
G. Sagar Suri and
Anr. v. State of UP and Ors.3
,
Rashmi Jain v. State of UP4
,
Jibrial
Diwan v. State of Maharashtra5
,
Mohammed Ibrahim v. State of
Bihar6
,
State of Haryana v. Bhajan Lal7
,
Sheela Sebastian v. R.
Jawaharraj8
and
Bandekar Brothers Pvt Ltd. & Anr v. Prasad
Vassudev Keni & Ors9
.

8. Learned senior counsel appearing on behalf of respondent No.2
while reiterating the submissions in the reply, highlights that it is only on
23.07.2020, the accused for the first time denied the transaction with the
complainant and stated that absolutely there is no proposal of sale of the
property in dispute. It is also stated that on 02.12.2021, the accused
fraudulently and in a bid to frustrate the rights of the complainant, sold
the property to JK Paper Ltd. and it is only on the perusal of the
documents, the complainant had come to know that the accused had got
converted the property from leasehold to freehold on 09.03.2017, which
was granted on 04.06.2018. It is, therefore, submitted that as per the
(2019) 16 SCC 739
(2009) 3 SCC 78
3 2000 2 SCC 636
(2014) 13 SCC 553
(1997) 6 SCC 499
(2009) 8 SCC 751
1992 Supp (1) SCC 335
(2018) 7 SCC 515
(2020) 20 SCC 1

[12]

terms of the agreement, the property was to be sold to the complainant
only after the same is free from all encumbrances and that process
continued up to 2018 and, therefore, there cannot be said to be any delay
in the registration of the FIR. While highlighting the averments made in
the FIR, the learned senior counsel has submitted that this court has to
confine itself to the allegations in the FIR and to consider whether the
allegations made therein constitute prima facie allegations of the offence
as alleged against them. According to him, the mere existence of civil
proceedings cannot act as a bar to the investigation of a cognizable
offence and both can go together in a given case. It has been pointed out
that right from the beginning, the intention of petitioner No.2 in
describing himself as a Karta of petitioner No.1 was clearly to cheat the
complainant and to dishonestly induce him to deliver the property.
It is
stated that the petitioners, who are accused Nos.3 and 4, in the FIR have
put their signatures as witnesses into the receipt which contains specific
averment that accused No.2 being Karta of accused No.1 is entitled to
enter into an agreement for the sale of the property in dispute. It is, thus,
submitted that prima facie the allegations against all the accused are
made out and this court should not interfere in the FIR at this stage as the
investigation is yet to be completed. It has also been argued that the High
Court should be extremely cautious and slow to interfere with the
investigation and/or trial of criminal cases and should not stay the
investigation and/or prosecution except when it is convinced beyond any
manner of doubt that FIR does not disclose cognizable offence. Learned
senior counsel has placed reliance on decisions of the Hon‟ble Supreme
Court in the cases of
Neeharika Infrastructure Pvt. Ltd v. State of

[13]

Maharashtra10
,
State of Madhya Pradesh v. Mishrilal11
,
Lalita Kumari
v. State of U.P.12
,
Edmund S. Lyngdoh v. State of Meghalaya13
,
Syed
Askari Hadi Ali Augustine Imam v. State (Delhi Admn
.
)14,
Lee Kun
Hee v. State of UP15
,
Trisuns Chemicals v. Raj Agarwal16
,
Priti Saraf &
Anr v. State of NCT of Delhi & Anr17
and
Ramveer Upadhyay & Anr v.
State of UP & Anr18
and the decision of this court in the matter of
MGF
Developments v. State NCT of Delhi19

9. The Learned APP while placing reliance on standing order No.
Crime/06/2022 dated 23.05.2022 stated that the understanding of the
petitioners with respect to the pecuniary jurisdiction of E.O.W is
completely misplaced as an offence has a pecuniary limit of up to one
crore. E.O.W is empowered to enquire into with the approval of district
DCP and up to three crore Jt. CP Range/Crime and for more than three
crores Spl. CP/EOW and in this case, there is approval by the competent
authority and hence, the petitioner cannot allege any incompetence on the
part of E.O.W.

10. I have heard submissions made by the learned senior counsel
appearing on behalf of the parties and perused the record.

11. So far as the pecuniary jurisdiction of E.O.W is concerned, since
the issue goes to the root of the matter, therefore, the same has to be
2021 SCC OnLine SC 315
(2003) 9 SCC 426
(2014) 2 SCC 1
(2016) 15 SCC 572
(2009) 5 SCC 528
2012 3 SCC 132
1999 8 SCC 686
2021 sSCC OnLine SC 206
2022 SCC OnLine SC 484
2022 SCC OnLine Del 2824

[14]

examined at the threshold. Standing order No.Crime/06/2022 dated
23.05.2022 clause 4.1.2 reads as under:

"4.1.2 Following officers will be competent to order
for taking up the enquiry in EOW as well as in Districts: -

Sr. Amount Competent Authority
No.

1. Up to 1 Crore District DCP

2. 1Crore to 3 Crore Jt. CP Range/Crime

3. More than 3 Crore Spl. CP/EOW

If during the course of the enquiry, it emerges that
the Economic offence involves more than one crore and
three crores, the complaint(s) will be sent to the competent
authority for approval as well as for taking up the enquiry.
Complaints which have been asked to be enquired from the
higher offices like CP/Delhi and Special CP/EOW shall be
taken up for enquiry, after preliminary scrutiny and
verifying the facts. Enquiry of complaints and subsequent
investigation of the cases as per described limit shall be
undertaken in the districts by specialized units like DIU
(District Investigation Unit)/ Crime with the approval of
the competent authority.

Further, the Multi Victim Cases (20 (Twenty) or
more victims) will be investigated in EOW irrespective of
the amount involved. The rest of the cases of similar
nature, but less than 3 crore and less than twenty victims,
shall be investigated by concerned Districts or Crime. The
cases related to cyber-crime in which substantial cyber
techniques are to be delved into will be taken up by Cyber
Cell under Special Cell or Crime Branch. The cases in

[15]

which inter-state gangs are involved will be investigated
by Crime Branch."

12. A perusal of the standing order clearly indicates that there is no
threshold limit for E.O.W to investigate any offence. What is required as
per the standing order is the approval of competent authority for taking
up the inquiry in E.O.W as well as in districts. For an amount up to one
crore, the competent authority is district DCP and for an amount of one
crore to three crore, the competent authority is Jt. CP Range/Crime,
whereas, for an amount of more than three crore Spl. CP/EOW is the
competent authority.

13. It is, thus, seen that there is no substance in the argument advanced
on behalf of the petitioners that the E.O.W does not have pecuniary
jurisdiction to entertain a complaint for an offence involving an amount
of less than three crores. It is, therefore, held that the E.O.W is competent
to investigate the offence in question.

14. Under the facts of the present case, the question that arises for
consideration of this court is whether the High Court would be justified
in quashing FIR at its nascent stage when the investigation has not yet
been completed. The determination of the question involved in the
instant case would depend upon the issue as to whether the allegations
made in the FIR, even when taken at their face value and accepted in
their entirety, do they prima facie constitute any offence or make out a
case against the petitioners or, whether the allegations made in the FIR
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 petitioners.

[16]

15. It is settled legal position that the power under
Section 482
of the
Cr.P.C. should be sparingly invoked with circumspection and it should
be exercised to see that the process of law is not abused or misused. The
High Court at the stage of quashing the FIR is not to embark upon an
inquiry as to the probability, reliability or genuineness of the allegations
made therein. If the averments taken on face value do not constitute the
ingredient necessary for an offence, the FIR in question can certainly be
quashed. Though the law does not require that the complaint should
reproduce the legal ingredient of the offence verbatim, however, the
complaint must contain the basic facts necessary for making out an
offence under the penal code. It is also permissible in the exercise of
power under
Section 482
of the Cr.P.C. to examine, whether a matter
which is essentially of a civil nature has been given a cloak of a criminal
offence. If the High Court finds that the continuation of FIR would result
in an abuse of the process of law, the High Court would be empowered to
exercise its power under
Section 482
of the Cr.P.C. and to quash the FIR
even at the nascent stage.

16. In order to reassure the aforesaid legal position, a few judgments
of the Hon‟ble Supreme Court on the aforesaid legal aspects are
necessary to be considered.

17. The Hon‟ble Supreme Court in the matter of
State of Karnataka v.
L. Muniswamy20
had an occasion to consider the scope and ambit of
power under
Section 482
of the Cr.P.C. In the case of
L. Muniswamy

(supra), the challenge was made by the accused to the charges before the
High Court and the High Court dismissed the petition, accordingly, the
(1997) 2 SCC 699

[17]

accused therein were before the Hon‟ble Supreme Court. The Hon‟ble
Supreme Court in paragraph No.7 of its decision held as under:

"In the exercise of this wholesome power, the High Court
is entitled to quash a proceeding if it comes to the
conclusion that allowing the proceeding to continue would
be an abuse of the process of the Court or that the ends of
justice require that the proceeding ought to be quashed.
The saving of the High Court's inherent powers, both in
civil and criminal matters is designed to achieve a salutary
public purpose which is that a court proceeding ought not
to be permitted to degenerate into a weapon of harassment
or persecution. In a criminal case, the veiled object behind
a lame prosecution, the very nature of the material on
which the structure of the prosecution rests and the like
would justify the High Court in quashing the proceeding in
the interest of justice. The ends of justice are higher than
the ends of mere law though justice has got to be
administered according to laws made by the legislature.
The compelling necessity for making these observations is
that without a proper realisation of the object and purpose
of the provision which seeks to save the inherent powers of
the High Court to do justice between the State and its
subjects it would be impossible to appreciate the width and
contours of that salient jurisdiction."

18.
In the matter of
Chandrapal Singh and Ors v. Maharaj Singh &
Anr.21
, the Hon‟ble Supreme Court was considering the validity of a
criminal complaint instituted by the landlord against the tenant for the
commission of an offence under
Sections 193
,
and
of the IPC.
The cognizance was taken by the Chief Judicial Magistrate for the
aforesaid offences and the order of cognizance was challenged by the
tenant before the High Court. The High Court did not find any merit in
the said challenge and, therefore, the tenant was before the Hon‟ble
Supreme Court.
(1982) 1 SCC 466

[18]

19. While deciding the aforesaid controversy the Hon‟ble Supreme
Court in paragraph No.1 of the decision has observed as under:

"A frustrated landlord after having met his waterloo in
the hierarchy of civil courts has further enmeshed the
tenant in a frivolous criminal prosecution which prima
facie appears to be an abuse of the process of law. The
facts when stated are so telling that the further discussion
may appear to be superfluous."

Extract of paragraph No.14 is also reproduced as under:

"Complainant herein is an advocate. He lost in both courts
in the rent control proceedings and has now rushed to the
criminal court. This itself speaks volumes. Add to this the
fact that another suit between the parties was pending
from 1975. This conclusion is inescapable that invoking
the jurisdiction of the criminal court in this background is
an abuse of the process of law and the High court rather
glossed over this important fact while declining to exercise
its power under
Section 482
CrPC."

On the basis of the aforesaid observations and findings, the
Hon‟ble Supreme Court in paragraph No.15 of its judgment had set aside
the order of taking cognizance against the petitioners therein.

20. The Hon‟ble Supreme Court in the matter of
G. Sagar Suri and
Anr.
(supra) which is also relied upon by the learned counsel appearing
on behalf of the petitioners had an occasion to consider the prayer for
quashing of the criminal proceedings against the petitioners therein for
an offence under
Section 406
/
of IPC.

In paragraph No.8 of the
aforesaid decision, it has been held that if the matter, which is essentially
of a civil nature, has been given a cloak of a criminal offence, criminal
proceedings are not a short-cut of other remedies available in law, are
factors to be considered while exercise power under Section 482 of the

[19]

Cr.P.C
. In addition to the earlier decision of the Hon‟ble Supreme Court
in the case of
L. Muniswamy
(supra), the Hon‟ble Supreme Court had
also considered other decisions in the case of Kurukshetra University &
Anr v. State of Haryana & Anr.22, Chandrapal Singh and Ors. (supra)
and under the circumstances of that case has held that invoking the
jurisdiction of a criminal court for allegedly having committed an
offence under
Section 406
/
of IPC by the appellant, was an abuse of
the process of law and, therefore, the appeal preferred by the
appellant/accused, therein, was allowed and criminal case pending before
the Chief Judicial Magistrate was quashed.

21.
In the matter of
Zhandu Pharmaceutical Works Ltd & Anr. v.
Mohd Sharaful Haque & Anr.23
, while placing reliance on the decision
in the case of
R.P. Kapur v. State of Punjab24
, and the decision of the
Hon‟ble Supreme Court in the case of
Bhajan Lal
(supra) and other
earlier decision of the Hon‟ble Supreme it has been held as under:

"9. In R.P. Kapur v. State of Punjab
MANU/SC/0086/1960:1960 Cri. LJ 1239, this Court
summarized some categories of cases where inherent
power can and should be exercised to quash the
proceedings.

(i) where it manifestly appears that there is a legal bar
against the institution or continuance e.g., want of
sanction;

(ii) where the allegations in the first information report or
complaint taken at its face value and accepted in their
entirety do not constitute the offence alleged;
(1977) 4 SCC 451
(2005) 1 SCC 122
AIR 1960 SC 866

[20]

(iii) where the allegations constitute an offence, but there
is no legal evidence adduced or the evidence adduced
clearly or manifestly fails to prove the charge."

22.
In the decision of
Uma Shankar Gopalika v. State of Bihar &
Ors.25
, the Hon‟ble Supreme Court was considering the challenge made
by the accused to the complaint filed by respondent No.2, therein, for an
offence punishable under
Section 420
/
120B
of the IPC. The matter was
related to an agreement and the complainant had made a partial payment
of his investment to the accused. It was the case of the appellant/accused
therein that the only allegation against him was that the accused assured
the complainant that when they receive the insurance claim, they would
pay a certain sum to the complainant but the same was never paid. It was
also alleged that the accused, therein, fraudulently persuaded the
complainant to agree so that accused persons may take steps for moving
consumer court in relation to their own claim. The Hon‟ble Supreme
Court in paragraph No.6 of its decision had held that every breach of
contract would not give rise to the offence of cheating and only those
cases of breach of contract would amount to an offence where there was
any deception played at the very inception. If the intention to cheat has
developed later on, the same cannot amount to the offence of cheating. In
the said case, it was found that there was no deception at the very
inception and, accordingly, no offence under
section 420
/
120B
of the
IPC was found to be committed. The dispute in question was found to be
civil in nature and it was held that the remedy lies before the civil court
by filing a properly constituted suit. Accordingly, the Hon‟ble Supreme
Court had set aside the order passed by the High Court and also quashed
(2005) 10 SCC 336

[21]

the complaint in question. Paragraph Nos.6 and 7 of the aforesaid
decision are being reproduced as under:

"6. Now the question to be examined by us is as to whether
on the facts disclosed in the petition of the complaint any
criminal offence whatsoever is made out of much fewer
offences Under
Section 420
/
120B
of the Indian Penal
Code. The only allegation in the complaint petition against
the accused persons is that they assured the complainant
that when they receive the insurance claim amounting to
Rs. 4,20,000/-, they would pay a sum of Rs. 2,60,000/- to
the complainant out of that but the same has never been
paid. Apart from that, there is no other allegation in the
petition of complaint. It was pointed out on behalf of the
complainant that the accused fraudulently persuaded the
complainant to agree so that the accused persons may take
steps for moving the Consumer Forum in relation to a
claim of Rs. 4,20,000/-. It is well settled that every breach
of contract would not give rise to an offence of cheating
and only in those cases breach of contract would amount
to cheating where there was any deception played at the
very inception. If the intention to cheat has developed,
later on, the same cannot amount to cheating. In the
present case, it has nowhere been stated that at the very
inception there was any intention on behalf of the accused
persons to cheat which is a condition precedent for an
offence Under
Section 420
of the Indian Penal Code.

7. In our view petition of complaint does not disclose any
criminal offence at all much less any offence either Under
Section 420 or
Section 120B
of the Indian Penal Code and
the present case is a case of purely civil dispute between
the parties for which remedy lies before a Civil Court by
filing a properly constituted suit. In our opinion, in view of
these facts allowing the police investigation to continue
would amount to an abuse of the process of Court and to
prevent the same it was just and expedient for the High
Court to quash the same by exercising the powers Under

Section 482
of the Code of Criminal Procedure which it
has erroneously refused."

[22]

23.
In the matter of
Indian Oil Corporation v. NEPC India Ltd. and
Ors.26
, the Hon'ble Supreme Court was again considering the scope and
ambit of
Section 482
of the Cr.P.C. in the context of an offence
punishable under
Sections 405
/
/
and
of the IPC. In
the said
decision
, the complaint in question was found to be maintainable only
with respect to an offence punishable under
Sections 450
and
of the
IPC and the other offences were found to have been rightly quashed by
the High Court.

The Hon‟ble Supreme Court in the matter of
Vir
Prakash Sharma v. Anil Kumar Agarwal & Anr27
was considering the
tenability of the offence under
Sections 406
/
/
and
of the IPC.
The cognizance was taken against the appellants therein and the summon
was issued to them. The appellants approached the High Court, however,
the High Court refused to exercise its jurisdiction on the ground that the
allegation against the accused therein was factual in nature and cannot be
adjudicated in the exercise of power under
Section 482
of the Cr.P.C.
The Hon'ble Supreme Court reiterated the well-settled legal position that
if the allegations contained in the complaint even if taken on face value
and taken to be correct in their entirety, do not disclose an offence, the
High Court can exercise its power under
Section 482
of Cr.P.C and
quashed the complaint/FIR. In the said case, the dispute was found to be
essentially of a civil nature. Non-payment or underpayment of the price
of the goods itself does not amount to the commission of an offence of
cheating or criminal breach of trust. Finally, paragraph No.17 of the
judgment of the High Court was set aside and the order of taking
cognizance was quashed.
(2006) 6 SCC 736
(2007) 7 SCC 373

[23]

24.
In the matter of
Inder Mohan Goswami & Anr. v. State of
Uttaranchal28
, the Hon'ble Supreme Court was considering the validity
of FIR under
Section 420
/
of the IPC against the appellants therein
against whom non-bailable warrants were also issued. The allegations
therein against the accused were that the accused allegedly had
committed an offence of cheating in connivance with other accused by
selling a portion of their land to a third party and by cancelling the
General Power of Attorney. The complainant therein after the filing of
the criminal complaint also instituted a civil suit against the appellant
therein. The appellant/accused, therein, filed a petition under
Section 482

Cr.P.C. before the High Court. The High Court dismissed the petition on
the ground that the record demonstrated that the allegation in the FIR
constitutes an offence as alleged by the complainant therein.

The Hon'ble
Supreme Court in
the said decision
of
Inder Mohan Goswami
(supra)
made reference to various earlier decisions including the decisions of the
English Courts and analyzed the relevant provisions of law with respect
to
sections 420
,
and
of the IPC. It has been held that inherent
powers under
Section 482
of the Cr.P.C. can be exercised: -

(i) to give effect to an order under the court,
(ii) to prevent abuse of the process of court, and
(iii) to otherwise secure the ends of justice.

It has also been held that if any abuse of the process leading to
injustice is brought to the notice of the court, then the court would be
justified in preventing injustice by invoking inherent powers in absence
of specific provisions in the statute.
(2007) 12 SCC 1

[24]

25. The Hon'ble Supreme Court after analyzing the relevant Sections
of the
IPC
has held that the court must ensure that criminal prosecution is
not used as an instrument of harassment or for seeking private vendetta
or with an ulterior motive to pressurize the accused. It has also been held
that it is neither possible nor desirable to lay down an inflexible rule that
would govern the exercise of inherent jurisdiction. Inherent jurisdictions
of the High Courts under
Section 482
of the Cr.P.C., though wide, have
to be exercised sparingly, carefully and with caution and only when it is
justified by the tests specifically
laid down in
the statute itself.

26.
In the decision of
Suneet Gupta v. Anil Triloknath Sharma &
Ors.29
, the Hon'ble Supreme Court while affirming the order of the High
Court of quashing an FIR for offences punishable under Sections
468/406 read with 120B of the
IPC
, has noticed that the High Court
rightly quashed the FIR as
in that case
one partner was trying to drag the
principal company into criminal litigation to recover dues which the
principal had paid to the other partner. It was also noted that the dispute
therein was a tripartite civil dispute and the same was given a colour of
criminality.

27.
In the matter of
Gorige Pentaiah v. State of Andhra Pradesh &
Ors30
, the appellant therein was aggrieved by the judgment passed by the
High Court, whereby, his petition was dismissed for quashing of the FIR
for offences punishable under
Section 3(1)(x)
of the Scheduled Castes
and Scheduled Tribes (Prevention of Atrocities) Act, 1989 and under

Section 447
/
/
of the IPC. The Hon'ble Supreme Court made the
reference to the decided cases on the subject and has held that inherent
(2008) 11 SCC 670
(2008) 12 SCC 531

[25]

power under
Section 482
of the Cr.P.C. should be exercised by the High
Court for the advancement of justice. The complaint
,
in that case
, was
found to be a total abuse of the law.

28. The Hon'ble Supreme Court in the matter of
R. Kalyani v. Janak
C. Mehta & Ors31
while considering various earlier decisions as have
been referred hereinabove including the decision in the case of
Rajesh
Bajaj v. State NCT of Delhi32
,
Hamida v. Rashid33
,
Sunita Jain v.
Pawan Kumar Jain34
,
State of Orissa v. Saroj Kumar Sahoo35
,
Kailash
Verma v. Punjab State Civil Supplies Corpn.36 Monika Kumar
v. State
of U.P37 has held that the following proposition of law would emerge
from
the said decision
.

"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, 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 the commission of an
offence, the court shall not go beyond the same and pass
(2009) 1 SCC 516
(1999) 3 SCC 259
(2008) 1 SCC 474
(2008) 2 SCC 705
(2005) 13 SCC 540
(2005) 2 SCC 571
(2008) 8 SCC 781

[26]

an order in favour of the accused to hold the 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."

28.1 Having held so, the Hon'ble Supreme Court went on to observe
that no hard and fast rule can be laid down. Each case has to be
considered on its own merit and the High Court should not hesitate to
exercise its jurisdiction in appropriate cases. One of the paramount duties
of the superior courts is to see that a person who is apparently innocent is
not subjected to prosecution and humiliation on the basis of a false and
wholly untenable complaint.

29. Finally, the Hon'ble Supreme Court affirmed the decision of the
High Court, whereby, the complaint in question was set aside by the
High Court. The same legal position had been reiterated by the Hon'ble
Supreme Court in the decision of
Dalip Kaur & Ors. v. Jagnar Singh &
Anr38
whereby the offence involved was that under
Sections 406
and
of the IPC and the question which was decided by the Hon'ble Supreme
Court was whether a breach of contract of an agreement for sale would
constitute an offence for the aforesaid Sections. The Hon'ble Supreme
Court came to the conclusion that the High Court did not correctly
exercise its power and, accordingly, the matter was remitted back for
fresh consideration.

30. The Hon'ble Supreme Court in the matter of Kishan Singh
through LRs v. Gurpal Singh & Ors39 was considering the tenability of
an FIR under
Sections 420
/
/
/
/
/
120B
of the IPC which was
(2009) 14 SCC 696
(2010) 8 SCC 775

[27]

quashed by the High Court placing reliance on the decree of the civil
court between the same parties in respect of the subject matter. In
paragraph No.25 of the said decision, it was found that FIR was lodged
with the sole intention to harass the respondents therein. The FIR was
lodged in the year 2002 and the allegations in the FIR were substantially
similar to the allegation made in the civil suit filed in the year 1996. It
was found that FIR was filed with inordinate delay and there was no
plausible explanation for the same. In paragraph No.21 of the said
decision, it is noted that prompt and an early recording of the occurrence
by the informant with its vivid details gives an assurance regarding the
truth of its version. In case, there is some delay involving the FIR, the
complainant must give an explanation for the same. It has also been held
that undoubtedly, delay in lodging the FIR does not make the
complainants‟ case improbable when such delay is properly explained.
However, deliberate delay in lodging the complaint is always fatal. It has
also been held that in cases where there is a delay in lodging an FIR, the
court has to look for a plausible explanation for such delay. In the
absence of such an explanation, the delay may be fatal. The reason for
quashing such proceedings may not be merely that allegations were an
afterthought or had given a coloured version of the event, in such cases,
the court should carefully examine the facts before it for the reason that a
frustrated litigant who failed to succeed before the civil case may initiate
criminal proceedings just to harass the other side with mala fide intention
or the ulterior motive of wreaking vengeance on the other party.
Paragraph No.21 to 26 are being reproduced as under:

"21. Prompt and early reporting of the occurrence by the
informant with all its vivid details gives an assurance

[28]

regarding the truth of its version. In case, there is some
delay in filing the FIR, the complainant must give an
explanation for the same. Undoubtedly, a delay in lodging
the FIR does not make the complainant's case improbable
when such a delay is properly explained. However,
deliberate delay in lodging the complaint is always fatal.
vide:
Sahib Singh v. State of Haryana
, (1997) 7 SCC 231

22. In cases where there is a delay in lodging an FIR, the
Court has to look for a plausible explanation for such
delay. In absence of such an explanation, the delay may be
fatal. The reason for quashing such proceedings may not
be mere that the allegations were an afterthought or had
given a coloured version of events. In such cases, the court
should carefully examine the facts before it for the reason
that a frustrated litigant who failed to succeed before the
Civil Court may initiate criminal proceedings just to
harass the other side with mala fide intentions or the
ulterior motive of wreaking vengeance on the other party.
Chagrined and frustrated litigants should not be permitted
to give vent their frustrations by cheaply invoking the
jurisdiction of the criminal court. The court proceedings
ought not to be permitted to degenerate into a weapon of
harassment and persecution. In such a case, where an FIR
is lodged clearly with a view to spite the other party
because of a private and personal grudge and to enmesh
the other party in long and arduous criminal proceedings,
the court may take a view that it amounts to an abuse of
the process of law in the facts and circumstances of the
case.

(vide:
Chandrapal Singh and Ors. v. Maharaj Singh and
Anr.
;
State of Haryana and Ors. v. Ch. Bhajan Lal and
Ors.
;
G. Sagar Suri and Anr. v. State of U.P. and Ors.
; and

Gorige Pentaiah v. State of A.P. and Ors
.

23. The case before us relates to a question of the
genuineness of the agreement to sell dated 4.1.1988. The
said agreement was between Kishori Lal and the
respondents and according to the terms of the said
agreement, the sale deed was to be executed by 10.6.1989.
As the sale deed was not executed within the said time, suit

[29]

for specific performance was filed by the other party in
1989 which was decreed in 1996.

24. So far as the present appellants are concerned,
agreement to sell dated 22.10.1988 was executed in favour
of their father and the sale deed was to be executed by
15.6.1989. No action was taken till 1996 for non-execution
of the sale deed. The appellants' father approached the
court after 7 years by filing Suit No. 81/1996 for specific
performance. However, by that time, the suit filed by the
present respondents stood decreed. The appellants' father
filed another Suit No. 1075/96 for setting aside the
judgment and decree passed in favour of the respondents 1
to 4. The said suit was dismissed by the Additional District
Judge (Senior Division), Khanna on 10.6.2002.
Subsequently, the appellants preferred RFA No. 2488/02
on 15.7.2002 against the aforesaid order, and the said
appeal is still pending before the Punjab & Haryana High
Court.

25. It is to be noted that the appellants' father Kishan
Singh lodged FIR No. 144/02 on 23.7.2002 through his
attorney Jaswant Singh Mann under
Sections
/
/
/
/
/
120B
IPC, against the respondents.
The allegations made in the FIR were substantially similar
to the allegations made by the appellants in Civil Suit No.
1075/96, which had been decided against them. It is
evident that the aforesaid FIR was filed with inordinate
delay and there has been no plausible explanation for the
same. The appellants lodged the aforesaid FIR only after
meeting their Waterloo in the Civil Court. Thus, it is
evident that the FIR was lodged with the sole intention of
harassing the respondents and enmeshing them in long
and arduous criminal proceedings. We are of the view that
such an action on the part of the appellants' father would
not be bona fide, and the criminal proceedings initiated by
him against the respondents amount to an abuse of the
process of law.

26. In view of the above, and to do substantial justice, we
are not inclined to interfere with the order passed by the
High Court quashing the criminal proceedings against the

[30]

respondents in spite of the fact that the impugned judgment
dated 13.02.2009 passed in Criminal Misc. No. 4136 of
2003 is not sustainable in the eyes of law."

31.
In the matter of
Binod Kumar & Ors. v. State of Bihar & Anr.40
,
the Hon‟ble Supreme Court was considering the charges under
Section
of the IPC and whether criminal complaint for criminal breach of
trust for allegedly retaining the bill amount payable by the respondent
No.2 therein was liable to be quashed. While placing reliance on earlier
decisions, the Hon'ble Supreme Court in paragraphs no.17 to 19 has held
as under:

"17.
Section 420
IPC deals with cheating. Essential
ingredients of
Section 420
IPC are: - (i) cheating; (ii)
dishonest inducement to deliver property or to make, alter
or destroy any valuable security or anything which is
sealed or signed or is capable of being converted into a
valuable security, and (iii) mens rea of the accused at the
time of making the inducement.

18. In the present case, looking at the allegations in the
complaint on the face of it, we find no allegations are
made attracting the ingredients of
Section 405
IPC.
Likewise, there are no allegations as to cheating or the
dishonest intention of the appellants in retaining the
money in order to have wrongful gain to themselves or
causing wrongful loss to the complainant. Excepting the
bald allegations that the appellants did not make payment
to the second respondent and that the appellants utilized
the amounts either by themselves or for some other work,
there is no iota of allegation as to the dishonest intention
in misappropriating the property. To make out a case of
criminal breach of trust, it is not sufficient to show that
money has been retained by the appellants. It must also be
shown that the appellants dishonestly disposed of the same
in some way or dishonestly retained the same. The mere
(2014) 10 SCC 663

[31]

fact that the appellants did not pay the money to the
complainant does not amount to criminal breach of trust.

19. Even if all the allegations in the complaint taken at the
face value are true, in our view, the basic essential
ingredients of dishonest misappropriation and cheating
are missing. Criminal proceedings are not a short cut for
other remedies. Since no case of criminal breach of trust
or dishonest intention of inducement is made out and the
essential ingredients of
Sections 405
/
IPC are missing,
the prosecution of the appellants under
Sections 406
/
120B

IPC, is liable to be quashed."

32. The Hon‟ble Supreme Court in the matter of
Vinod Natesan v.
State of Kerala & Ors.41
was considering a case with respect to an
offence under Section 420/406 read with
Section 34
of the IPC, where,
the allegations were that the accused after entering into the agreement
with the complainant with regard to the availing of intellectual services
for marketing the products of the complainant, the accused did not pay
the amount due and payable in the agreement. It was alleged that only
part payment was made and the remaining payment was not made and
the accused therein backed out from the agreement and thereby the
accused had committed that offence as alleged therein. The High Court

in that case
exercised its power under
Section 482
of the Cr.P.C. and
quashed the complaint, therefore, the complainant approached the
Hon'ble Supreme Court. The Hon'ble Supreme Court affirmed the order
passed by the High Court and dismissed the appeal. Paragraph No.10 and
11 of
the said decision
are being reproduced as under:

"10. Having heard the Appellant as party in person and
the learned Advocates appearing on behalf of the original
Accused as well as the State of Kerala and considering the
judgment and order passed by the High Court, we are of
(2019) 2 SCC 401

[32]

the opinion that the learned High Court has not committed
any error in quashing the criminal proceedings initiated
by the complainant. Even considering the allegations and
averments made in the FIR and the case on behalf of the
Appellant, it cannot be said that the ingredients of Sections
406 and 420 are at all satisfied. The dispute between the
parties at the most can be said to be the civil dispute and it
is tried to be converted into the criminal dispute.

Therefore, we are also of the opinion that continuing the
criminal proceedings against the Accused will be an abuse
of process of law and, therefore, the High Court has
rightly quashed the criminal proceedings. Merely because
the original Accused might not have paid the amount due
and payable under the agreement or might not have paid
the amount in lieu of one month Notice before terminating
the agreement by itself cannot be said to be a cheating
and/or having committed offence Under
Sections 406
and
of the Indian Penal Code as alleged. We are in
complete agreement with the view taken by the High
Court.

11. In so far as the submissions made on behalf of the
Appellant-party in person that initially the learned Judge
dismissed the application and, thereafter when the
judgment was dictated and pronounced, the learned Judge
has allowed the application and, therefore, the impugned
judgment and order passed by High Court is required to
be quashed and set aside is concerned, the aforesaid has
no substance. What is produced as P-45 is the docket of
the file, which does not bear the signature of the learned
Judge. Therefore, it cannot be said that initially the
learned Judge dismissed the petition and, thereafter, when
the judgment was pronounced the order was changed and
the application was allowed. Even otherwise, as observed
hereinabove, we are more than satisfied that there was no
criminality on part of the Accused and a civil dispute is
tried to be converted into a criminal dispute. Thus, to
continue the criminal proceedings against the Accused
would be an abuse of the process of law. Therefore, the
High Court has rightly exercised the powers Under

Section 482
of the Code of Criminal Procedure and has

[33]

rightly quashed the criminal proceedings. In view of the
aforesaid and for the reasons stated above, the present
appeal fails and deserves to be dismissed and is
accordingly dismissed."

33. The Hon'ble Supreme Court in the case of
Anand Kumar Mohatta
& Anr. v. State (NCT of Delhi), Department of Home & Anr.42
was
considering a case, wherein, the challenge made by the accused in the
FIR for an offence punishable under
Section 406
of the IPC was rejected
by the High Court, therefore, the accused therein was before the Hon'ble
Supreme Court in an SLP. The dispute had arisen out of the agreement
dated 03.06.1993 entered into between the accused and the complainant
therein. The FIR was lodged about 21 years after the agreement. In that
case, initially, the FIR was also lodged against the wife of one of the
accused but no offence was found to have been committed after the
investigation. The agreement was with respect to the development of the
property owned by the accused. The property was situated at Feroz Shah
Road, New Delhi. The parties agreed to develop the said property by
considering a high-rise building comprising flats. The complainant
therein paid a sum of Rs. One crore as per the agreement. The agreement
could not be fulfilled on account of new building regulations. The
appellant therein wrote a letter that he does not wish to develop the
property. The amount received by the appellant therein admittedly was
not returned to the complainant. A complaint was filed by the
complainant therein on 19.11.2011 for an offence punishable under

Section 406
of the IPC. It was alleged that the accused was guilty of an
offence under Section 406 since he had clandestinely and surreptitiously
transferred the subject property in the name of his wife i.e., co-accused
(2019) 11 SCC 706

[34]

therein and the said act was done to defeat the agreement dated
03.06.1993. While placing reliance on earlier decisions of the Hon‟ble
Supreme Court as discussed in the preceding paragraphs, the Hon'ble
Supreme Court in paragraphs Nos.23 to 25 has held as under:

"23. We, thus find that it is not possible to hold that the
amount of Rs. One crore which was paid along with the
development agreement as a deposit can be said to have
been entrustment of property which has been dishonestly
converted to his own use or disposed of in violation of any
direction of law or contract by the Appellant. The
Appellants have not used the amount nor misappropriated
it contrary to any direction of law or contract which
prescribes how the amount has to be dealt with. Going by
the agreement dated 03.06.1993, the amount has to be
returned upon the handing over of the constructed area of
the owner which admittedly has not been done. Most
significantly the Respondent No. 2 has not demanded the
return of the amount at any point of time. In fact, it is the
specific contention of the Respondent No. 2 that he has not
demanded the amount because the agreement is still in
subsistence.

24. We do not see how it can be contended by any stretch
of imagination that the Appellants have misappropriated
the amount or dishonestly used the amount contrary to any
law or contract. In any case, we find that the dispute has
the contours of a dispute of civil nature and does not
constitute a criminal offence.

25. Having given our anxious consideration, we are of the
view that assuming that there is a security deposit of Rs.
One Crore and that he has misappropriated the dispute
between the two parties can only be a civil dispute."

33.1 The Hon'ble Supreme Court set aside the order passed by the High
Court and quashed the FIR and chargesheet filed against the
accused/appellant therein. It was found that the prosecution was mala
fide untenable and solely intended to harass the appellant therein. It was

[35]

also held that the respondent/complainant therein having failed to
succeed to recover the deposited amount through a civil action tried to
implicate the accused therein with mala fide intent. Paragraphs No.31 to
33 are also reproduced as under:

"31. We find that the prosecution is mala fide, untenable
and solely intended to harass the Appellants. We are
forfeited in view of the Respondent not having made any
attempt to recover the deposit of Rs. One Crore through a
civil action.

32. We have, therefore, no hesitation in quashing the FIR
and the charge sheet filed against the Appellants. Hence,
the FIR No. 0139/2014 dated 20.08.2014 and charge sheet
dated 03.08.2018 are hereby quashed.

33. For the aforesaid reasons, we hereby set aside the
impugned judgment and order dated 02.02.2016 of High
Court of Delhi. Accordingly, appeal is allowed along with
the application filed by the Appellants seeking amendment
of main prayer."

34. The Hon'ble Supreme Court in this decision while taking note of
the decision in the case of
Indian Oil Corporation
(supra) has held that
there is a growing tendency in a business circle to convert purely civil
disputes into criminal cases.

The said expression has been made keeping
in mind the observations made by the Hon‟ble Supreme Court in the
decision of
Indian Oil Corporation
(supra). In Paragraph No.13 therein,
it was held that any effort to settle civil disputes and claims, which do not
involve any criminal offence, by applying pressure through criminal
prosecution should be deprecated and discouraged.

35. The Hon'ble Supreme Court in the case of
Prof. R. K.
Vijayasarathy & Anr. v. Sudha Seetharam & Anr.
(supra) was
considering the prayer of the accused-appellant therein to quash the

[36]

criminal proceedings instituted by the complainant and the challenge to
the criminal proceedings was rejected by the High Court. In that case,
FIR for an offence punishable under Sections 405/406/415/420 read with

Section 34
of the IPC was registered against the appellant therein in
paragraphs No.25 to 30. Following observations have been made by the
Hon'ble Supreme Court, the same is reproduced as under:-

"25. The suit for recovery of money was instituted by the
son of the Appellants against the first Respondent in 2013.
The complaint alleging offences under the Penal Code was
filed by the first Respondent belatedly in 2016. It is clear
from the face of the complaint, that no amount was
entrusted by the first Respondent to either of the
Appellants and there was no dishonest inducement of the
first Respondent by the Appellants to deliver any property.
As stated by the first Respondent in the complaint, the
money belonged to the son of the Appellants. It was
transferred by the Appellants' son to her on his own
volition. The money was alleged to have been returned to
the Appellants on the instructions of their son. A plain
reading of the complaint thus shows that the ingredients
necessary for constituting offences Under Sections 405,
415 and 420 of the Penal Code are not made out.

26. The Respondents have relied on the decision of this
Court in
Rajesh Bajaj v. State of NCT of Delhi
: (1999) 3
SCC 259. In that case, the Delhi High Court had quashed
an FIR alleging an offence Under Section 420 of the Penal
Code on the ground that the complaint did not disclose the
commission of any offence. Allowing the complainant's
appeal, this Court held thus:

"9. It is not necessary that a complainant should
verbatim reproduce in the body of his complaint all
the ingredients of the offence he is alleging. Nor is
it necessary that the complainant should state in so
many words that the intention of the Accused was
dishonest or fraudulent. Splitting up of the
definition into different components of the offence

[37]

to make a meticulous scrutiny, whether all the
ingredients have been precisely spelled out in the
complaint, is not the need at this stage. If factual
foundation for the offence has been laid in the
complaint the court should not hasten to quash
criminal proceedings during investigation stage
merely on the premise that one or two ingredients
have not been stated with details..."

The decision does not advance the submission of
the first Respondent. As we have noted above, the
complaint in the present case is bereft of the basic
facts necessary to constitute the offences alleged
Under Sections 405, 406, 415 and 420 of the Penal
Code.

27. Learned Senior Counsel for the Appellant contended
that the actions of the first Respondent constitute an abuse
of process of the court. It is contended that the present
dispute is of a civil nature and the first Respondent has
attempted to cloak it with a criminal flavor to harass the
aged Appellants. It is also contended that there is an undue
delay in filing the complaint from which the present appeal
arises, and this demonstrates the mala fide intention of the
first Respondent in filing the complaint against the
Appellants. Learned Senior Counsel for the Appellants
relied on the decision of this Court in
State of Karnataka v.
L Muniswamy
: (1977) 2 SCC 699. In that case, the
prosecution alleged that eight of the Accused had
conspired to kill the complainant. The Karnataka High
Court quashed the proceedings on the ground that no
sufficient ground was made out against the Accused. A
three judge Bench of this Court dismissed the appeal by
the State with the following observations:

"7. ...In the exercise of this wholesome power, the
High Court is entitled to quash a proceeding if it
comes to the conclusion that allowing the
proceeding to continue would be an abuse of the
process of the Court or that the ends of justice
require that the proceeding ought to be quashed.

[38]

The saving of the High Court's inherent powers,
both in civil and criminal matters, is designed to
achieve a salutary public purpose which is that a
court proceeding ought not to be permitted to
degenerate into a weapon of harassment or
persecution. In a criminal case, the veiled object
behind a lame prosecution, the very nature of the
material on which the structure of the prosecution
rests and the like would justify the High Court in
quashing the proceeding in the interest of
justice."

28. The jurisdiction Under
Section 482
of the Code of
Criminal Procedure has to be exercised with care. In the
exercise of its jurisdiction, a High Court can examine
whether a matter which is essentially of a civil nature has
been given a cloak of a criminal offence. Where the
ingredients required to constitute a criminal offence are
not made out from a bare reading of the complaint, the
continuation of the criminal proceeding will constitute an
abuse of the process of the court.

29. In the present case, the son of the Appellants has
instituted a civil suit for the recovery of money against the
first Respondent. The suit is pending. The first Respondent
has filed the complaint against the Appellants six years
after the date of the alleged transaction and nearly three
years from the filing of the suit. The averments in the
complaint, read on its face, do not disclose the ingredients
necessary to constitute offences under the Penal Code. An
attempt has been made by the first Respondent to cloak a
civil dispute with a criminal nature despite the absence of
the ingredients necessary to constitute a criminal offence.
The complaint filed by the first Respondent against the
Appellants constitutes an abuse of process of court and is
liable to be quashed.

30. For the above reasons, the appeal is allowed. The
judgment of the High Court is set aside and the criminal
proceedings arising from PCR 2116 of 2016 instituted by
the first Respondent against the Appellants are quashed.
We however clarify, that no opinion has been expressed on

[39]

the merits of the pending civil suit filed by the son of the
Appellants for the recovery of money. The pending suit
shall be disposed of in accordance with the law."

36. On the basis of the aforesaid legal position and for the purposes of
the present case, this court is of the considered view that the High Court
is well within its jurisdiction to quash the FIR even at its nascent stage if
the following conditions are fulfilled: -

(i) If the allegations made in the FIR, even if are accepted to be true
in their entirety, the same would not constitute prima facie
commission of offence alleged in the FIR;

(ii) If the matter is essentially of a civil nature and has been given a
cloak of a criminal offence.

(iii) If the allegations made in the FIR 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.

37. The delay in lodging of the FIR may by itself not be the reason for
quashing the FIR, however, the same can always be taken into
consideration to appreciate the truthfulness or genuineness of the
complaint in question.

38. Coming back to the facts of the present case, as stated in the initial
paragraphs, it would be seen that the entire allegation made against the
present petitioners is that the petitioners are son and wife of Bhai Manjit
Singh. The main accused i.e., Bhai Manjit Singh had introduced the
present petitioners to the complainant to sell the property in dispute to
the complainant.

[40]

39. It is, thus, alleged in the complaint that accused Nos.1 to 4
deliberately committed fraud by misrepresenting that the accused No.2 is
the Karta of accused No.1 in the year 2004. Whereas, according to the
complaint, it was found that accused No.2 had already resigned as Karta
of accused No.1 and instead accused No.4 was recognized as Karta of
accused No.1. It is, thus, further reiterated that accused Nos.1 to 4,
therefore, played fraud upon the complainant by misrepresenting the
status of accused No.2 as Karta. It is also alleged that the present
petitioners had acknowledged the sale of the property as well as the
payment made by the complainant towards advance. Receipt of the
amount so received by the main accused, namely, Bhai Manjit Singh was
witnessed by the present petitioners. One of the receipts on page No.97
of the reply is being reproduced so as to understand the actual recital
made therein.

― RECEIPT
Received a sum of Rs. 31,00,000/- (Rupees Thirty One
Lacs Only) as earnest money from Mr.. Punit Beriwala, s/o
Shri S.S. Beriwala, r/o 15/10 Sarvapriya Vihar, New Delhi,
against the sale of our property No. 28-A, Prithviraj Road,
New Delhi, admeasuring 3727 sq. yards. The total sale
consideration agreed upon is Rs. 28 Crore. (Rupees
Twenty Eight Crores only), further a sum of Rupees Thirty
lakhs to be made by Thursday.

The sale is subject to the said property being free from all
kinds' charges, lien, encumbrances, prior sales,
mortgages, litigations, claims, etc. The Seller has agreed
to get the said property freehold from the concerned
authorities at his own expense before the transfer of the
said property in favor of the PURSHASER i.e Shri Punit
Beriwal or his nominees

[41]

Sd/-

SELLER.

Bhai Manjit Singh HUF
Through karta Bhai Manjit Singh
s/o
r/o 2 South End Lane, New Delhi
WITNESS

1. -SD-

Maheep Singh
2 south End Lane, New Delhi

2. SD/-

Vikramjit Singh
2 south End Lane, New Delhi"

40. It is further alleged in the FIR that on 22.04.2004, the physical
possession of a part of the property in dispute was handed over by the
accused No.1 to 4 to the complainant. It is further alleged that accused
No.1 to 4 undertook to get the said property unencumbered by making
payments to various authorities. However, the same was sold to JK Paper
Ltd. It is alleged that the accused Nos.1 to 4 for the very first time vide
letter dated 23.07.2020 had refused to perform their obligation to
conclude the sale transaction of the said property as agreed with the
complainant.

41. Having considered the allegations in the FIR in their entirety and
accepting them to be correct on face value, this court is of the considered
view that the same does not constitute an offences under
Sections
/
/
/
/
120B
of the IPC. As per paragraph No.7 of the FIR,
when all accused were ready and willing to sell the said property to the
complainant, there was no reason to purport that the accused No.2 was
the Karta of accused No.1. There is no written agreement between the
respondent No.2 with the petitioners for sale of such a valuable and

[42]

prime property. The only role alleged against the petitioners are that they
are witnesses to the alleged receipts signed by Bhai Manjit Singh for
receipt of part sale consideration. The act of signing the receipt as a
witness would not constitute any of the aforesaid offences. The last
payment admittedly has been made on 03.01.2015 and it is unbelievable
that in the year 2005, having made the payment of Rs.1,64,50,000/-
against the total consideration of Rs.28,00,00,000/-, one would not prefer
getting a formal agreement executed. The narration of the FIR does not
disclose any action/step/effort being made by respondent No.2 between

03.01.2005 to 18.07.2020 i.e., for almost 16 long years. It is again
beyond any prudent behaviour that someone who makes a payment of
Rs.1,64,00,000/- in the year 2005 would not even bother to enquire about
the further steps to be taken either for the execution of the sale document
or to enquire about the step being taken by the seller with respect to
obtaining NOCs etc. for almost 16 years. There is no whisper about any
steps being taken by respondent No.2 between 2005 to 2020. Even
according to the recital in the FIR, admittedly a part possession of the
property in dispute was handed over to respondent No.2 on 22.04.2004
itself. The same would conclusively belie the allegation that right from
inception there had been an intention of cheating respondent No.2.
Respondent No.2 filed a civil suit on 28.10.2001 before this court
seeking relief for specific performance, possession and injunction. The
date of FIR is 16.06.2022. The application in the civil suit for dismissal
of the suit under
Order VII Rule XI of the CPC
was dismissed by this
court on 07.02.2022 and against the said order the learned Division
Bench of this court in FAO(OS) No.20/2022 stayed the further
proceedings of the said civil suit vide order dated 29.03.2022. It is, thus,

[43]

apparent that the proceedings of the civil suit have been stayed by the
Division Bench of this court on 29.03.2022. It is, thereafter, the instant
FIR dated 16.06.2022 has been registered.

42. Cheating is defined in
Section 415
of the IPC and is punishable
under
Section 420
of the IPC.
Section 415
of the IPC is set out below:

"Section 415: - 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'.
Explanation. -A dishonest concealment of facts is a
deception within the meaning of this section."

Section 415 thus requires: -

1. Deception of any person.

2. (a) Fraudulently or dishonestly inducing that person-

(i) to deliver any property to any person; or

(ii) to consent that any person shall retain any property; or

(b) Intentionally inducing that person 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.

43. The Hon'ble Supreme Court in the matter of
Inder Mohan
Goswami
(supra) while considering the FIR lodged under
Section
/
/
120B
of the IPC has held as under: -

[44]

"42. On a reading of the aforesaid section, it is manifest
that in the definition there are two separate classes of acts
which the person deceived may be induced to do. In the
first class of acts he may be induced fraudulently or
dishonestly to deliver property to any person. The second
class of acts is the doing or omitting to do anything which
the person deceived would not do or omit to do if he were
not so deceived. In the first class of cases, the inducing
must be fraudulent or dishonest. In the second class of
acts, the inducing must be intentional but need not be
fraudulent or dishonest. 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 a fraudulent or
dishonest intention at the time of making the promise.
From his mere failure to subsequently keep a promise, one
cannot presume that he all along had a culpable intention
to break the promise from the beginning.

43. We shall now deal with the ingredients of
Section 467

IPC.
Section 467
IPC reads as under:

"467. Forgery of valuable security, will etc.--
Whoever forges a document which purports to
be a valuable security or a will, or an authority
to adopt a son, or which purports to give
authority to any person to make or transfer any
valuable security, or to receive the principal,
interest or dividends thereon, or to receive or
deliver any money, moveable property, or
valuable security, or any document purporting to
be an acquittance or receipt acknowledging the
payment of money, or an acquittance or receipt
for the delivery of any moveable property or
valuable security, shall be punished with
imprisonment for life, or with imprisonment of
either description for a term which may extend
to ten years, and shall also be liable to fine."

44. The following ingredients are essential for commission
of the offence under
Section 467
IPC:

1. the document in question so forged;

[45]

2. the accused who forged it.

3. the document is one of the kinds enumerated in the
aforementioned section.

The basic ingredients of offence under Section 467 are
altogether missing even in the allegations of the FIR
against the appellants. Therefore, by no stretch of the
imagination, the appellants can be legally prosecuted for
an offence under
Section 467
IPC.

45. Even if all the averments made in the FIR are taken to
be correct, the case for prosecution under
Sections 420

and
IPC is not made out against the appellants. To
prevent abuse of the process and to secure the ends of
justice, it becomes imperative to quash the FIR and any
further proceedings emanating therefrom.

46. The court must ensure that criminal prosecution is not
used as an instrument of harassment or for seeking private
vendetta or with an ulterior motive to pressure the
accused. On analysis of the aforementioned cases, we are
of the opinion that it is neither possible nor desirable to
lay down an inflexible rule that would govern the exercise
of inherent jurisdiction. Inherent jurisdiction of the High
Courts under
Section 482
Cr.P.C. though wide has to be
exercised sparingly, carefully and with caution and only
when it is justified by the tests specifically
laid down in
the
Statute itself and in the aforementioned cases. In view of
the settled legal position, the impugned judgment cannot
be sustained."

44. As has been discussed hereinabove, even as per FIR itself, the part
possession of the property in dispute was handed over to Respondent
No.2 in the year 2004 itself. There is no question of arriving at a
conclusion that there was a dishonest or fraudulent intention at the
beginning of the alleged act to induce the complainant to deliver an
advance sum to the accused. So far as
Section 467
IPC is concerned, I
have examined the entire FIR and there is no allegation of forgery

[46]

against the petitioners. Hence, an offence under Sections 467/468 is also
clearly not made out. None of the documents in the instant case has been
used as genuine which is known or has been reason to believe to be
forged and hence, an offence under
Section 471
of the IPC is also not be
attracted. There is no dishonest intention from the inception to induce
respondent No.2 to purchase the property in question and it is thus,
concluded that accepting all the allegations against the petitioner as
correct in the FIR, no offence as alleged is prima facie made out. The
case in hand clearly falls within exception No. (1) and (5) carved out for
quashing of criminal prosecution in the decision of
Bhajan Lal
(supra).
The allegations made in the FIR against the petitioners constitute purely
a civil dispute and an attempt is being made to cloak them as criminal
offences.

Exceptions No (1) and (5) of Bhajan Lal
(supra) are
reproduced as under: -

(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.

(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.

45. As far as the decision relied upon by the learned senior counsel for
respondent No.2 in the case of Neeharika Infrastructure Pvt. Ltd.

[47]

(supra) is concerned, in paragraph No.57 thereof, the principle of law
that emerges on the basis of the decisions of the Hon‟ble Supreme Court
right from the decision of the Privy Council have been reiterated. In
paragraph No.60 of
the said decision
, the Hon'ble Supreme Court has
clearly held that in a given case, there may be an allegation of abuse of
process of law by converting a civil dispute into a criminal dispute only
with a view to pressure the accused.

46. This court in the instant case finds that an effort has been made by
respondent No.2 to convert a civil dispute into a criminal case. The
decision of
Neeharika Infrastructure Pvt. Ltd.
(supra), therefore, would
not help the respondents.

The decision in the case of
Mishrilal
(supra),
relates to FIR under
Sections 147
/
/
and
of the IPC and
another FIR for various offences including an offence under Sections
302/307 etc. of the
IPC
. The Hon'ble Supreme Court in paragraph No.8
of
the said decision
has held that the Investigating Officer submitted the
challan on the basis of a complaint lodged by the accused Mishri Lal in
respect of the same incident.

It has been held, it would have been just,
fair and proper to decide both cases by the same court in view of the
guideline devised by the Hon‟ble Supreme court in the case of
Nathi Lal
& Ors. v. State of UP & Anr.43 The
principle laid down therein is that the
cross cases should be tried together by the same court irrespective of the
nature of the offence involved. The aforesaid principle of law is not
disputed and does not call for any consideration in the instant case. What
is being argued by respondent No.2 is that the accused No.2 in the instant
case has lodged an FIR against the present respondent No.2 stating
therein that the receipts in question are forged. According to respondent
1990 Supp SCC 145

[48]

No.2 in one place the accused No.2 is alleging that the receipts are false
and a contrary statement has been made to state that the amount in
question has been received against those receipts and, therefore, the FIR
which has been lodged by the respondent No.2 and the FIR lodged by the
accused No.2 are cross FIRs and it requires a trial to go on. The aforesaid
arguments do not have any substance for the reason that in the instant
FIR, this court is only concerned with the allegations made therein and to
adjudicate as to whether the same would constitute prima facie
commission of the offence or not.
Since it has been held that no prima
facie offence in question is made out, therefore, the FIR lodged by
accused No.2 of the present FIR against respondent No.2 would not bar
this court to exercise power under Section 482 of the Cr.P.C.

47. So far as the decision in the case of
Edmund S. Lyngdoh
(supra)
is concerned, in paragraph No.30 therein the Hon‟ble Supreme Court has
held that mere delay in lodging the FIR is not necessarily fatal to the
prosecution case. This court is in respectful agreement with the aforesaid
legal position. This court has not exercised its power under
Section 482

of the Cr.P.C. on the ground of delay alone. The court has proceeded to
analyze the allegations made in the FIR as a whole and has contrasted
them with the offence lodged against the petitioners and has opined that
the offence in question is not prima facie attracted, therefore, the FIR is
being quashed. The delay alone is not the reason but of course is one of
the reasons to consider the genuineness and authenticity of the allegation.
The Hon‟ble Supreme Court has not said that delay should never be
taken into consideration in considering the prayer for quashing of an FIR.
The delay of course can be one of the factors to be kept in mind while

[49]

exercising the power under
Section 482
of the Cr.P.C in a case of this
nature.

48. Another decision in the case of
MGF Developments
(supra) is in
the same line, therefore, the same does not require to be elaborately
discussed except to state that
in that case
, a Co-ordinate Bench of this
court has held that if on the reading of complaint, the Magistrate comes
to a conclusion that cognizable offence is made out then it is his duty to
register the FIR. In the present case, this court has considered the entire
FIR and has opined that no cognizable offence is made out it is for the
reason
the said decision
would not have any application under the facts
of the present case.

In the decision cited by the learned senior counsel for
the respondent in the case of
Syed Askari Hadi Ali Augustine Imam

(supra), the legal position expounded therein is well settled that
ordinarily criminal proceedings will have primacy over civil proceedings.
Precedence to criminal proceedings is given having regard to the fact that
the disposal of the civil proceedings ordinarily takes a long time and in a
given case civil proceedings as also criminal proceedings may proceed
simultaneously. In the present case, this court does not have any doubt
with respect to the legal position propounded therein. However, this
court has exercised its power not on the ground that the criminal and civil
proceedings cannot go simultaneously but on the ground that the instant
FIR that has been lodged does not constitute a criminal offence rather
dispute in question has been found to be of civil in nature. It is for this
reason that this decision would not have any application in the present
case.

[50]

49. Another decision in the case of
Lee Kun Hee
(supra) relied upon
by respondent No.2 relates to the scope of interference, in the exercise of
power under
Article 226
against the order of summoning issued by the
Magistrate. This court has elaborately considered the legal position
propounding by the Hon‟ble Supreme Court in various decisions and has
found that the instant case requires exercise under
Section 482
of the
Cr.P.C on the basis of the facts and situation involved therein.

50. The decision relied upon by the respondent in the case of
Trisuns
Chemicals
(supra) also relates to the scope of
Section 482
of the Cr.P.C.
in quashing the FIR and the decision in the case of
Ramveer Upadhyay
& Anr.
(supra) would also not help the respondents as the facts involved
in this case clearly calls for interference in the exercise of power under

Section 482
of the Cr.P.C. In the last decision in the case relied upon by
respondent No.2 in the case of
Priti Saraf & Anr
(supra) in paragraph
No.32 therein, the Hon‟ble Supreme Court has opined that careful
reading of the complaint/FIR/chargesheet would clearly disclose the
commission of an offence. It has been held that whether the allegations in
the complaint or otherwise are correct or not have to be decided based on
evidence to be led during the course of the trial.

In the instant case, this
court has held that the reading of the FIR does not disclose a cognizable
offence and the various decisions of the Hon‟ble Supreme Court as has
been discussed, hereinabove, would clearly show that in case no
cognizable offence is made out and an effort has been made to give a
cloak of criminality to a civil dispute, the High Court would be justified
in exercising its power under
Section 482
of the Cr.P.C.. It is, for this
reason, the decision in the case of
Priti Saraf & Anr.
(supra) would not
have any application in the facts of the present case.

[51]

51. In view of the aforesaid discussion, the instant petition is allowed
and FIR No.94 of 2022 registered at Police Station Economic Offences
Wing, Mandir Marg, New Delhi for offences punishable under
Sections
/
/
/
/
120B
of the IPC and all criminal proceedings
emanating therefrom qua the petitioners are hereby quashed.

52. The petition is disposed of alongwith pending applications.

53. However, any observation made herein would not prejudice any of
the rights of the parties in pending civil suit or other proceedings, if any.

(PURUSHAINDRA KUMAR KAURAV)
JUDGE
OCTOBER 17, 2022
priya