Justice R.K. Pattanaik in a case where the maintainability of criminal proceedings for misappropriation was challenged, noted that because a decree in a previous civil suit could not be materialised, the petitioners cannot be dragged into and alleged of having committed a criminal offence, just because they continued with the same state of affairs.
Brief Facts
The Petitioners have questioned the maintainability of the complaint proceedings which are pending in the file of learned S.D.J.M., Puri on the grounds that the allegations do not disclose the commission of any offence as such. It is alleged that continuance of the same would be an abuse of the process of court and therefore, it is liable to be interfered with and quashed.
The opposite party had filed a complaint and alleged that the petitioner had falsely claimed themselves to be the office bearers of a Binapani Vidyamandir Parichalana Samiti and had committed fraud, forgery, and misappropriation by cheating and swindled the funds of Binapani Vidyamandir. Hence the petitioners have committed the alleged offences. The complaint was filled, enquiry was conducted and a prima facie case was made out while taking cognizance of the offences under section 419 and 420 read with 34 IPC.
The allegations in the complaint is that the petitioner had cheated and misappropriated the school funds, these allegations have been denied on the ground that there is no as such mischief committed. In accordance to the background of this case, the petitioners have claimed that the dispute is about the management of the establishments and there is no misappropriation that has been alleged and the complaint has been filed in vengeance.
Previously the Opposite party in the current case had filed a civil case against the current petitioners and a decree was passed in the same, which was later on challenged as well and it was directed that a Managing Committee would be formed for the functioning of the school, but the same has not been formed.
Contentions of the Petitioner
It has been conducted by the petitioner’s side that the dispute between the parties is regarding the constitution of the Management Committee and to run the affairs of the school. Further, insofar as the petitioners are concerned, they are respectable senior citizens and have tried their level best for the development and smooth management of the school, and they have never misappropriated the funds. Instead, a huge amount has been spent for purchasing land and constructing the school. It is further contended that with regards to the nature of the allegation in the complaint, no case has been made out against the petitioners, but the learned court below failed to take cognizance of the same. They entertained the complaint and even framed charges which are not tenable in law. In conclusion it has been contended that neither a cognizable offence is being made out on the reading of the complaint and nor the proceedings can be sustained in law because it has been thrust upon the petitioner unnecessarily.
Contentions of the Respondent
The Opposite Party submitted that the complaint as filled reveals that cognizable offences has been committed by the petitioners and they misappropriated the funds of the school when they did not have the authority to do so because there were not the office bearers of the managing committee. And accordingly, a prima facie case has been made out for trial and the S.DJ.M., Puri has not committed any wrong or illegality in entertaining the same.
Observations of the Court
This Hon’ble Court noted that at times a civil dispute might lead to the commission of cognizable offences and in such situations, criminal prosecution lies. But at times a civil wrong is also given a cloak of criminal offence and in such cases it has been ruled that such criminal proceedings are required to be quashed to prevent the abuse of the process of the court. Several cases have been referred by the court and it has been noted that a matter which involves a dispute of civil nature cannot be legally allowed to become a subject matter of criminal proceedings. In one of the cases, the Apex court had ruled that a matter which is purely civil dispute and has been sought to be given a color of a criminal offence for vengeance, then such criminal actions would be an abuse of the process of law. Keeping in mind the settled positions of the law, the court further noted that it has to decide whether in the present case a colour of criminality has been given to civil dispute or whether the petitioner has really committed any offence. The foundation of the criminal proceeding is based on the dispute between the parties to run the school and manage its affairs as the office bearers and in that connection, the opposite party had approached the civil court and obtained a decree which was later modified in appeal. On the consideration of the decree, the interim body was directed to be formed ad thereafter the Managing Committee was not constituted for whatever reasons and that allowed the petitioners to continue in dealing with the management of the school. As per the complaint the civil court had examined the dispute and then the decree was passed, but the opposite party had alleged that after losing the legal battle the petitioners falsely represented themselves as the office bearers of the Binapani Vidyamandir Parichalana Samiti and managed the affairs of the school as well as the funds and such activities amounted to misappropriation. The Court in this regard noted that for a matter which was before the civil court and for which the decree could not be materialized, as a result of which the petitioners remained at the helm of the affairs of the management of the school cannot be dragged into and cannot be alleged to have committed the criminal offence as it would be grossly unfair and would result in a miscarriage of justice. Further, no specific instance of misappropriation has been alleged in the complaint and broadly the charges have been based on the charge that the petitioners are having no rights to be in the business of the management. And accordingly, the court was of the view that criminal proceedings in the current circumstances would be an abuse of the process of law.
Case Title : Dhaneswar Pattnaik & Others v. Loknath Nayak
Coram : Justice R. K. Pattanaik
Case No.: CRLMC No. 5425 of 2015
Advocate for the Appellant: Mr. Asok Mohanty, Senior Advocate
Advocate for the Respondent: Mr. S.R. Mohapatra, Advocate for sole O.P.
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