2014 (9) TMI 1248 - HC - Indian Laws

Dishonor of Cheque - partial discharge of debt made or not - offences under sections 420 and 406 of IPC - HELD THAT - The documents produced herein can be looked into only for the limited purpose in support of the petitioners case that the petitioners paid nearly Rs. 72 lakhs under the mortgage discharge receipt and sale deeds in favour of the second respondent defacto complainant and another Rs. 28 lakhs by way of deposits in the bank. Though the defacto complainant has not produced any document before this court in support of his theory that borrowal of Rs. 38, 00, 000/- by A1 along with A2 to A4 and execution of consent and confirmation letters by either A1 or A2 to A4 etc the documents produced herein would reveal that there was money transaction between the second respondent and the first petitioner and the first petitioner has made cash payment and executed sale deed in respect of his property towards partial discharge of the same. It is nobody s case that the defacto complainant was induced to part with money by any false representation made by the petitioners. The very conduct on the part of the first petitioner in repaying the amount and executing sale deed in respect of his property towards partial discharge of the amount as per the allegations raised in the complaint would go to show that there is no criminal intention for committing any act of cheating from the inception. The petitioners have also admittedly issued cheque for Rs. 25 lakhs on 16.10.2012 towards partial discharge of their liability. The allegation raised herein that the defacto complainant did not present the cheque for encashment as requested by the accused till the expiry of the cheque period without being obtained fresh cheque leaf appears to be in the light of the earlier conduct of the parties invented for the purpose of this case and is lacking in bonafide. Considering the nature of the transactions between the parties and subsequent conduct of the parties this Court is of the firm view that the allegations raised in the FIR would disclose that the dispute between the parties is more of civil in nature and there is no fraudulent or dishonest intention on the part of the petitioners to attract the offences under sections 420 and 406 IPC - this Court is of the opinion that no case is made out against the petitioners herein to attract the offence under section 506(ii) IPC. Such case put forth on the side of the complainant involving married daughters and unmarried daughter whose marriage was fixed to be held in December 2013 also appears to be improbable in nature. Petition allowed.

Summary

Issues:
Quashing of criminal proceedings under sections 420, 406, and 506(ii) IPC based on a complaint alleging civil nature of transactions and criminal intimidation.

Analysis:
1. The petitioners sought to quash the FIR, arguing that the allegations were civil in nature, aiming to extract money. They claimed the transactions were misrepresented to appear criminal, involving threats to kill and stop a marriage.
2. The court examined the complaint's contentions and the petitioners' defense, highlighting discrepancies in the narratives presented by both parties regarding a loan for a hotel business and subsequent repayment issues.
3. The court noted the petitioners' evidence of mortgage discharge receipts, sale deeds, and bank deposits to support their claim of repaying substantial amounts, contradicting the complainant's version.
4. Regarding the offenses under sections 420 and 406 IPC, the court found no evidence of cheating or criminal breach of trust, emphasizing the lack of fraudulent intent and the petitioner's efforts to repay the loan partially.
5. Citing previous judgments discouraging criminal courts for civil recovery matters, the court emphasized the importance of proving fraudulent intent for cheating allegations, which was absent in this case.
6. The court referenced Supreme Court rulings to establish that mere breach of contract does not constitute cheating unless fraudulent intent is proven, which was not evident in the present case.
7. The court concluded that the dispute was primarily civil in nature, lacking criminal intent, and thus, the offenses under sections 420 and 406 IPC were not made out.
8. Regarding the offense under section 506(ii) IPC, the court found the allegations vague and unsubstantiated, aimed at adding a criminal dimension to a civil dispute without credible threats or intimidation.
9. Relying on precedents emphasizing the need for real threats in criminal intimidation cases, the court dismissed the intimidation charges due to the lack of genuine threats or actions causing fear.
10. The court invoked Supreme Court observations to prevent criminal prosecution abuse for personal vendettas, leading to the quashing of the FIR to prevent the petitioners from facing unjust trial proceedings.
11. Ultimately, the court allowed the petition, quashing the FIR in Cr.No.1045 of 2013, to prevent the misuse of legal processes and ensure justice, closing the related miscellaneous petition.