TMI Blog2014 (10) TMI 1043X X X X Extracts X X X X X X X X Extracts X X X X ..... capable of being converted into a valuable security, and (iii) mens rea of the accused at the time of making the inducement. In the present case, looking at the allegations in the complaint on the face of it, there are no allegations are made attracting the ingredients of Section 405 Indian Penal Code. 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. Since no case of criminal breach of trust or dishonest intention of inducement is made out and the essential ingredients of Sections 405/420 Indian Penal Code are missing, the prosecution of the Appellants Under Sections 406/120B Indian Penal Code, is liable to be quashed - appeal allowed - decided in favor of appellant. - Criminal Appeal No. 2327 of 2014 (Arising out of SLP (Crl.) No. 9751/201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... khisarai vide its order dated 2.12.2002 dismissed the said petition and directed the Appellants to remain present in the court on 8.1.2003 for framing of charges Under Section 406/120B Indian Penal Code. The Appellants filed petition Under Section 482 Code of Criminal Procedure before the Patna High Court for quashing the said order and by the impugned order dated 18.2.2011, the High Court dismissed the petition. Aggrieved by the same, the Appellants are before us. 5. Dr. Manish Singhvi, learned Counsel appearing for the Appellants, contended that the act of withholding of payment to the second Respondent was as per the direction issued by the Vice-Chancellor and no case is made out for misappropriation of funds Under Section 406 Indian Penal Code. It was contended that the act of the Appellants was done in the discharge of their public duties and there was no dishonest intention to misappropriate the amount and the essential ingredients of criminal breach of trust are not made out and the High Court has not properly appreciated the matter. 6. Ms. Prerna Singh, learned Counsel for Respondent No. 1-State of Bihar, submitted that the instant petition does not relate to any poli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the allegations made in the complaint are patently absurd and inherently improbable so that no prudent person can ever reach a conclusion that there is a sufficient ground for proceeding against the accused; (3) where the discretion exercised by the Magistrate in issuing process is capricious and arbitrary having been based either on no evidence or on materials which are wholly irrelevant or inadmissible; and (4) where the complaint suffers from fundamental legal defects such as, want of sanction, or absence of a complaint by legally competent authority and the like. The Supreme Court pointed out that the cases mentioned are purely illustrative and provide sufficient guidelines to indicate contingencies where the High Court can quash the proceedings. 10. In Indian Oil Corporation v. NEPC India Ltd. and Ors. (2006) 6 SCC 736, this Court has summarized the principles relating to exercise of jurisdiction Under Section 482 Code of Criminal Procedure to quash complaints and criminal proceedings as under: The principles relating to exercise of jurisdiction Under Section 482 of the Code of Criminal Procedure to quash complaints and criminal proceedings have been stated and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... transaction or a contractual dispute, apart from furnishing a cause of action for seeking remedy in civil law, may also involve a criminal offence. As the nature and scope of a civil proceeding are different from a criminal proceeding, the mere fact that the complaint relates to a commercial transaction or breach of contract, for which a civil remedy is available or has been availed, is not by itself a ground to quash the criminal proceedings. The test is whether the allegations in the complaint disclose a criminal offence or not. 11. Referring to the growing tendency in business circles to convert purely civil disputes into criminal cases, in paragraphs (13) and (14) of the Indian Oil Corporation's case (supra), it was held as under: 13. While on this issue, it is necessary to take notice of a growing tendency in business circles to convert purely civil disputes into criminal cases. This is obviously on account of a prevalent impression that civil law remedies are time consuming and do not adequately protect the interests of lenders/creditors. Such a tendency is seen in several family disputes also, leading to irretrievable breakdown of marriages/families. There is also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rred LPA No. 716/2000 wherein it was directed that since it was not a statutory contract, no direction for payment of money could be issued and the Respondent No. 2 can pursue other remedies available in law for the recovery of money. Aggrieved by the said order, Respondent No. 2 filed SLP(C) No. CC 4832/2001 which was dismissed as withdrawn by this Court by Order dated 30.7.2001 granting him liberty to approach the appropriate forum. Respondent No. 2 thereafter filed Money Suit No. 2/2002 before the Court of Sub Judge 1st Court, Lakhisarai on 20.4.2002 for recovery of ₹ 69,010/- i.e. double the amount of ₹ 34,505/- and the said suit is pending. Second Appellant representing the university had also filed Money Suit No. 2/2006 before the same Court on 4.2.2006 claiming a sum of ₹ 1,44,437/- with interest against the second Respondent-contractor. These acts of the parties show that the parties have already had recourse to the civil remedies that are available to them in law. 13. Appellant Nos. 1 and 2 were then employed as Principal and Professor respectively in KSS College, Lakhisarai and Appellant No. 3 as Bursar of the said college. The Appellants have stated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... defined in Section 405 Indian Penal Code. For the offence punishable Under Section 406 Indian Penal Code, prosecution must prove: (i) that the accused was entrusted with property or with dominion over it and. (ii) that he (a) misappropriated it, or (b) converted it to his own use, or (c) used it, or (d) disposed of it. The gist of the offence is misappropriation done in a dishonest manner. There are two distinct parts of the said offence. The first involves the fact of entrustment, wherein an obligation arises in relation to the property over which dominion or control is acquired. The second part deals with misappropriation which should be contrary to the terms of the obligation which is created. 17. Section 420 Indian Penal Code deals with cheating. Essential ingredients of Section 420 Indian Penal Code 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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