Gopal Chandra Agarwal And (2) Ors. vs State Of U.P.Through Secy Home ...
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HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH
 
 

  							      			
 
							                  Reserved  
 
                            		         					AFR
 
   		 HIGH COURT OF JUDICATURE AT ALLAHABAD,
 
              	 	 LUCKNOW BENCH, LUCKNOW
 
				
 
				DISTRICT - LUCKNOW
 
                     	
 
	        Criminal Misc. Case No. 422 of  2003 (U/s 482 Cr.P.C.)
 

 
1.     Gopal Chandra Agarwal,aged about 48 years,S/O Late Sri M.B.    		Lal Agarwal,R/O B-322, Sector - B, Mahanagar, Lucknow.
 
	2.	     Gaurav Goel,aged about 24 years, S/O Sri Gopal Chandra 		         Agarwal R/O B-322, Sector - B, Mahanagar, Lucknow.
 
      3.	   Vaibhav Goel aged about 22 years, S/O Sri Gopal Chandra                      		     Agarwal R/O B-322, Sector - B, Mahanagar, Lucknow.
 

 
                                         	           	        ------Accused/Petitioners                               				 Versus:-
 

 
1.    State of U.P. Through Secretary,Home department ,
 
   U.P. Civil Secretariat, Lucknow 
 
2.    IInd A.C.J.M., Lucknow, District, Lucknow.
 
3.    Station Officer, Police Station, Gomti Nagar, Lucknow.
 
4.    Pradeep Singh S/O Sri Gurdeep Singh, R/O Managing Director,                       	  Cyber World  Infosystems, (India) Ltd., B-1/13-A,Vipul Khand,       	   Gomti Nagar, Lucknow
 
	
 
   				         			------Opposite Parties.
 

 
Petitioner's Counsel :- Sri J.N.Chaubey, Arun Sinha,Manish Kumar  
 
Respondents' Counsel :- Govt. Advocate, Sri Sudeep Seth, J.N.Pandey, 					Satendra Singh 
 

 
Hon'ble Visnhu Chandra Gupta,J.

J U D G M E NT

1. By means of this petition under section 482 of Criminal Procedure Code (for short "Cr.P.C.") petitioners have prayed for quashing the First Information Report (For short "FIR") lodged by opposite party no. 2 Pradeep Singh dated 11.1.2002 (Annexure 8 to the petition), charge-sheet dated 28.8.2002 (Annexure-9) filed after investigation of the aforesaid F.I.R. having case crime No.11 of 2002 and consequential proceedings initiated after taking cognizance thereon under section 406, 420, 379, 411, 504, 506 I.P.C. in Criminal case No. 219 of 2003 pending before II Additional Chief Judicial Magistrate, Lucknow.

2. I have heard learned counsel for petitioners, Sri Arun Sinha, counsel for opposite party no. 4, Sri Sudeep Seth and the learned A.G.A. and gone through the record of the aforesaid case along with the record of the trial Court.

3. The brief facts necessary for deciding this petition are that opposite party no. 4 Pradeep Singh (For short "O.P. No.4") moved an application before Senior Superintendent of Police, Lucknow alleging therein that he is the Managing Director of Cyber World Infosystem (India) Ltd. (For short"Company"). Petitioner Gopal Chand Agarwal and his two sons Gaurav Goel and Vaibhav Goel, petitioner no. 1,2 and 3 respectively came in the month of April, 2000 to his establishment and expressed desire to do business with O.P.No.4 and his father. The O.P.No.4 and his father refused to do business with them. However after 20 days they succeeded in persuading the father of O.P.No. 4. The petitioners expressed desire to purchase shares of company of O.P.No.4 and under oral agreement they handed over a sum of Rs.6,00,000/- lacs to O.P. No. 4. Gradually, they developed intimacy and family relations with O.P. No.4. They virtually developed the relations with intent to defraud and deceive the company and also the O.P .No.4. On 10.06.2000 all the three petitioners came at the company office. They gave two pay orders of Rs. 5 lacs each having no. 10362110 and 1036111 and asked that to save the income tax they are giving this money showing as interest but later on shares will be purchased from this amount. As such a sum of Rs. 16 lacs was given by the petitioners to O.P.No. 4. However, after waiting for long when petitioners did not turn up for shares, the O.P. No.4 contacted and asked them for purchase of shares but they avoided. Thereafter in the month of February, 2001, petitioner no. 1 Gopal Chandra Agarwal shown some need of money. The O.P. No. 4 gave a cheque of Rs. 2 lacs against pay order no. 1036110. Taking the advantage of personal relation with the O.P. No. 4 and his father the petitioners with intent to defraud and cause economic loss under criminal conspiracy came at some date and time in absence of O.P. No.4 and his father in the office of company and took away five cheque leaves having Nos.715861 to 65 of personal account of O.P. No. 4 and five cheque leaves of having Nos. 244145 to 49, company's account, personal letter heads and letter pads of company, some personal papers and other important blank and written signed papers of O.P. No.4 and the petitioners thereby committed theft of the aforesaid articles. The fact of this theft came to the knowledge of O.P. No. 4 when State Bank of India informed that cheques issued by him having no. 715862, 63 and64 of Rs. 14,30,000, Rs.5,30,000/- and Rs. 6,70,300/- respectively, were bounced on account of non-availability of funds in his account. The Branch Manager expressed doubt that some one doing forgery by means of these cheques. Later on, it was found that to up-serve the amount and to defraud O.P. No.4 and his Company the petitioners after making forged entries entered arbitrarily amount in the cheques. O.P. No.4 also mentioned that in connection with business he mostly remained out of station for considerable long period, so he leaves the signed cheques in the office, so in his absence no difficulty may arise in making the payments. When O.P. No.4 and his father contacted the petitioners on 7.10. 2001, the petitioners promised to return stolen cheques, letter pads and other signed documents and came at 5 P.M. in the office of the O.P. No.4 and asked him that they will take the same amount of money mentioned in the cheques and only thereafter, they will return the papers to him. The O.P. No.4 asked why he will return Rs. 25 lacs against Rs.14 lacks received by him from you. The petitioners after hurling abuses and extending threats in the presence of Amit Seth and Awadh Naresh Tiwari left the office. They were also armed with country made pistols. On the basis of this application, the FIR was lodged on 11.1.2002 after order dated 10.1.2002 passed by Circle Officer of Police. The case was investigated and charge-sheet under sections 406, 420, 379, 411, 504 and 506 IPC was filed against the petitioners. The court of ACJM IInd took cognizance and proceeded with the trial in criminal case No. 219 of 2003.

4. The order taking cognizance and consequential proceedings were challenged by the petitioners in the present petition under section 482 Cr.P.C. before this Court, which was allowed by this Court by means of order dated 10.12.2004. The said order was challenged by respondent no. 4 in Criminal Appeal no. 349 of 2008 before Apex Court. The Apex court after setting aside the order dated 10.12.2004 sent back the case to this Court to pass fresh order in accordance with law.

5. The petitioners filed two supplementary affidavits to bring on record some additional facts. The petitioners shown in them that one more FIR was lodged after this incident against the bank authorities and the petitioners in regard to cheque having no. 715861 which was subject matter of the present FIR. This subsequent FIR was lodged at case crime no. 166/2002 under sections 420,467.468,471 and 120-B IPC, but later on, police submitted final report. It was alleged that actually O.P. No. 4 and his company took a loan of Rs. 4650184/- from the petitioners as shown in chart (Annexure 3-A). For payment of that loan the cheques were issued by respondent no. 4, but they were dishonoured, for which the petitioners filed proceedings against O.P. No.4 under section 138 of Negotiable Act ( for short as the "N.I. Act").

The details of cheques and cases filed by petitioners are as follows.

Cheque Nos.  Amount    Case No.		Parties name.
 
 1. 715862   14,30,000/-    1551/2001   Gaurav Goel Vs. Pradeep	Kumar
 
2.  715863    5,30,000/-    1853/2001     Vaibhab Goel Vs.  Pradeep Kumar
 
  3. 715864   6,75,000/-   1845/2001  M/s Gopal Motor finance  Vs. Pradeep,
 
 4.  244145   8,97,928/-   1444/2001  Gaurav Goel Vs. Cyber World Info 
 
 5. 244146  11,16,950/- 1844/2001   Gopal Motor Fin. Vs.  Cyber World Info 
 

6. It was further shown that notices of demand were issued before filing of cases to O.P. No.4 in the month of June, 2001. Reply thereof has been given by O.P. No.4, but instead of giving reply of notice dated 20.6.2001 against dishonour of cheques, O.P.No. 4 sought one month's time to pay total amount and felt sorry in reply. The O.P. No.4 had not mentioned about the theft of cheques and other papers in there written reply dated 29.6.2001.

7. It was further shown that a petition under section 482 Cr.PC having Cr. Misc.Case No.247/2002, was filed by Rahul Hakku, M.D. of the Company in respect of taking cognizance in above mentioned case No.1444/2001 but in the entire petition he has nowhere stated that questioned cheques or any other documents were stolen by the petitioners. On this score too it has been stated that FIR in question lodged against the petitioners is false.

8. O.P. No.4 filed counter affidavit denying the allegations of petition and supplementary affidavits filed by the petitioners, alleging it to be a short counter affidavit,without reserving any right therein to file any other counter affidavit. In the short counter affidavit the O.P.No.4 narrated the story about litigation in High Court and Hon'ble Supreme Court. In the matter of another FIR lodged at case crime no. 166 of 2002, it has been mentioned in the short counter affidavit that after submission of final report by the policeO.P.No.4 filed a protest petition bearing case No. 298 of 2007 in the court of Chief Judicial Magistrate, Lucknow. The Magistrate dismissed the protest petition vide order dated 21.07.2007. Against the said order O.P.No. 4 filed Criminal Revision bearing No. 221 of 2007 in the court of District and Sessions Judge, Lucknow. The Additional District and Sessions, Room No.2, Lucknow vide its order dated 29.08.2011 allowed the criminal revision and quashed the order dated 21.07.2007. Thereafter, the Magistrate directed for further investigation vide order dated 12.09.2011. The order of Magistrate was challenged by the petitioners before this Court by filing a petition bearing No.3551 of 2002 under Section 482 Cr.P.C. which was subsequently dismissed as not pressed vide order dated 12.09.2012.

9. From perusal of the contents of the counter affidavit filed by respondent no. 4 it is clear that there is no specific denial of documents filed by the petitioners. It is also alleged that whatever documents filed by the petitioners along with supplementary affidavit are manufactured, fabricated and false, which were prepared by the petitioners on the stolen papers and are the subject matter of present lis. Evasive denial has been made of the allegations of petition under section 482 Cr.P.C. which is evident from para 22 of the short counter affidavit. Para 22 is reproduced herein below:

"That the averments made in the petition and the supplementary affidavits filed by the petitioners are wrong and categorically denied and the documents appended therein, relating to alleged correspondence between the petitioners and the opposite party No.4/ his company are forged and fabricated on blank signed papers and letter heads of the Opposite Party No.4/his company. The averments of the Opposite Party No.4 in the FIR taken in entirety prima facie constitute offence for making out a case against the petitioners. The trial is pending before the Trial Court which is liable to be proceeded against the accused persons i.e. petitioners. The present petition under Section 482 Cr.P.C is not tenable and is liable to be dismissed."

10. Learned counsel for the petitioners relied upon the following judgments in support of his contentions.

10.1 Sunil Kumar Vs. Escorts Yamaha Motors Ltd. And Ors. (1999) 8 SCC 468, wherein the proceeding of case under Sections 420, 406, 468 IPC was quashed keeping in view the fact that FIR was lodged to pre-empt the filing of complaint under Section 138 of Negotiable Instruments Act against the appellant .

10.2 All Cargo Movers (I) Pvt. Ltd. Vs. Dhanesh Badarmal Jain and another (2008 (60) ACC 375), wherein the Apex Court after taking into consideration the pleadings made by the complainant earlier to filing the criminal case and also taking into the fact to the notice that a criminal complaint under Section 138 N.I. Act had already been pending against the complaint, the criminal proceedings under Sections 406, 420 were initiated were found to be an abuse of the due process of law and the proceedings were quashed.

10.3 Anjani Kumar Vs. The State of Bihar and another (2008 (61) ACC 982, wherein it has been held that while discharging official duties the appellant raided the medical shop of complainant and recommended for cancellation of his licence. The Apex Court on fact found that the complainant never alleged about the demand of bribe either in his bail application moved before the Court nor at any earlier stage before criminal court in which he was facing criminal trial of charges on the basis of FIR lodged by the appellant and consequently quashed the proceedings for want of prosecution sanction under section 197 Cr.P.C. The Apex Court also recorded the finding that sanction accorded by the District Magistrate under Section 196 Cr.P.C. was without any authority.

10.4 Zandu Pharmaceutical Works Ltd. & Ors. Vs. Mohd. Sharaful Haque & Anr. (2005 (2) JIC 188 (SC), wherein the Hon'ble Supreme Court considered the scope of Section 482 Cr.P.C. and powers of High Court and on fact it was found that the criminal proceeding were launched against sheer abuse of process of law.

10.5 Baijnath Jha Vs. Sita Ram & Anr. 2008 (2) JIC 377 (SC) wherein the proceedings pending against the appellant were quashed after examining the material and observing on fact that the proceedings instituted were mala fide, based on vague assertions and constitute sheer abuse of process of law in light of category (7) of Bhajan Lal's case [State of Haryana vs. Bhajan Lal, 1990(2) JIC 997 (SC)].

10.6 Som Mittal Vs. Government of Karnataka 2008 (60) ACC 980 SC, wherein three judges bench of the Apex Court considered the scope of powers conferred under section 482 Cr.P.C.

10.7 Harshendra Kumar D. Vs. Rebatilata Koley and others 2011 (1) SCC (Cri) 1139, wherein the Apex Court in para 25 held that under what circumstance document produced by the accused can be looked into for quashing the proceedings. Para 25 is extracted below for ready reference:

" In our judgment, the above observations cannot be read to mean that in a criminal case where trial is yet to take place and the matter is at the stage of issuance of summons or taking cognizance, materials relied upon by the accused which are in the nature of public documents or the materials which are beyond suspicion or doubt, in no circumstance, can be looked into by the High Court in exercise of its jurisdiction under section 482 Cr.P.C or for that matter in exercise of revisional jurisdiction under Section 397 of the Code. It is fairly settled now that while exercising inherent jurisdiction under section 482 or revisional jurisdiction under section 397 of the Code in a case where complainant is sought to be quashed, it is not proper for the High Court to consider the defence of the accused or embark upon an enquiry in respect of merits of the accusations. However, in an appropriated case, if on the face of the documents,which are beyond suspicion or doubt,placed by the accused, the accusations against him cannot stand, it would be travesty of justice if the accused is relegated to trial and he is asked to prove his defence before the trial court. In such as matter, for promotion of justice or to prevent injustice or abuse of process, the High Court may look into the materials which have significant bearing on the matter at prima facie stage".

11. In support of his contention ,learned counsel appearing for respondent no. 4 relied upon the following judgments.

11.1 Central Bureau of Investigation Vs. K.M.Sharan (2008) 4 SCC,471, Sunita Jain Vs. Pawan Kumar Jain and others , (2008) 2 SCC 705 and Hamida Vs. Rashid Alias Rasheed and others , (2008) 1 SCC 474, wherein the Apex Court discussed the scope of section 482 Cr.P.C. and held that High Court cannot embark upon the inquiry whether the allegations in the FIR and the charge-sheet were reliable or not and is not required to record the finding about the truthfulness or veracity of the allegations made in the FIR and charge-sheet. No interference is warranted under section 482 Cr.P.C. in an order of summoning the accused.

11.2 State of U.P. Vs. Awadh Kishore Gupta and Others, (2004) 1 SCC 691,wherein the Apex Court dealing with the inherent jurisdiction conferred upon the Court under Section 482 Cr.P.C. held that there is alternative remedy available to the petitioner, hence inherent jurisdiction should not be invoked and documents annexed with the petition cannot be treated as evidence without being tested and proved in accordance with law and High Court cannot quash the proceeding on the basis of those documents which shall not part of the complaint or investigation. It was also held that quashing of the proceedings merely on the ground of allegation of mala fides against informant is not a valid.

11.3 Rajesh Bajaj Vs. State NCT of Delhi and Ors. (1999) 3 SCC 259, wherein the Apex Court held that if averments made in FIR prima facie makes out a case for investigation, the High Court cannot quash the complaint under Section 482 Cr.P.C. on the ground that the complaint disclosed a commercial or money transaction. It was also held that it is not necessary to include content verbatim of the ingredients of the offence, hence the complaint/FIR cannot be quashed while exercising the jurisdiction under section 482 Cr.P.C.

11.4 State of Karnataka Vs M. Devendrappa and Another, (2002) 3 SCC 89, wherein the Apex Court ruled that under Section 482 Cr.P.C. legitimate prosecution cannot be quashed and the High Court should not assume the role of trial court and to embark upon the enquiry to examine the material meticulously. The reliability and the truthfulness of the evidence would be judged in the trial and not in the proceeding under Section 482 Cr.P.C.

11.5 State of Bihar and Another Vs. P.P. Sharma, IAS and Another, 1992 Supp (1) SCC 222, wherein it was held that act of the High Court treating the affidavits and documents produced before it by the petitioner/accused as evidence committed error in putting an end to the prosecution on its inception by going into merits in a pre-trial stage. The documents which, unless proved to be true during trial ,such document cannot be found the basis of quashing the proceedings. Though, this petition was filed under Article 226/227 of the Constitution but the Apex Court also going through the analogy of Section 482 Cr.P.C. decided the petition.

11.6 Vishnu Dutt Sharma Vs. Daya Sapra (Smt.), (2009) 13 SCC 729, wherein this matter relates to dishonour of cheque. The Apex Court while dealing with controversy held that any finding in a criminal proceedings by no stretch of imagination would be binding in a civil proceedings. On this score, it has been stated that proceedings of civil nature cannot be quashed.

11.7 Sangeetaben Mahendrabhai Patel Vs. State of Gujrat and Another, (2012 7 SCC 621, wherein the Apex Court discussed the principles of double jeopardy. The Apex Court held that the person is convicted under Section 138 N.I. Act can be further tried for the offence under Sections 406/420 read with Section 114 IPC.

12. I have considered the authorities cited at bar and after going through the same it is necessary to look into the facts of this case in light of contentions put forward by the counsel for the parties.

13. It is well settled proposition of law that observations of a court's judgment cannot be read in isolation from its context as held in Sukhwant Singh Vs. State of Punjab, 1995(32) ACC 488 (SC). There are hardly two cases of identical facts. The slight difference in fact may change the whole scenario and in a changed circumstance the applicability of law would also be changed. Hence the judgment of the Apex Court should be considered with a view as to what has been held in peculiar facts and circumstances of the case and what would be ratio propounded therein.

14. In R.P. Kapur v. State of Punjab, AIR 1960 SC 866 the Supreme Court also summarized some categories of cases where inherent power can and should be exercised to quash the proceedings.

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

(b) 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;

( c) 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.

15. The scope of exercise of power under Section 482 CrPC and the categories of cases where the High Court may exercise its power under it relating to cognizable offences to prevent abuse of process of any Court or otherwise to secure the ends of justice were set out in some detail by the Apex Court in State of Haryana v. Bhajan Lal (1992 Supp (1) 335). The illustrative categories indicated by this Court are as follows:

"(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.

(2)    Where the allegations in the first information report and other materials, if any, accompanying the FIR do not disclose a cognizable offence, justifying an investigation by police officers under Section 156(1) of the Code except under an order of a Magistrate within the purview of Section 155(2) of the Code.
 

 
(3)Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same do not disclose the commission of any offence and make out a case against the accused.
 

 
(4)Where the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a police officer without an order of a Magistrate as contemplated under Section 155(2) of the Code.
 

 
(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
 

 
(6)Where there is an express legal bar engrafted in any of the provisions of the Code or the Act concerned (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or Act concerned, providing efficacious redress for the grievance of the aggrieved party.
 

 
(7) Where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge." 	 
 
16. 	In G. Sagar Suri and Anr. v. State of U.P. and Ors. [(2000) 2 SCC 636, the Apex Court opined in para 8 - :
 

"8. Jurisdiction under Section 482 of the Code has to be exercised with great care. In exercise of its jurisdiction the High Court is not to examine the matter superficially. It is to be seen if a matter, which is essentially of a civil nature, has been given a cloak of criminal offence. Criminal proceedings are not a short cut of other remedies available in law. Before issuing process a criminal court has to exercise a great deal of caution. For the accused it is a serious matter. This Court has laid certain principles on the basis of which the High Court is to exercise its jurisdiction under Section 482 of the Code. Jurisdiction under this section has to be exercised to prevent abuse of the process of any court or otherwise to secure the ends of justice."

17. In Indian Oil Corporation, M/s. v. M/s. NEPC India Ltd. ,AIR 2006 S C, 2780 the Apex Court while discussing the scope of section 482 to quash the criminal proceedings has held in paragraphs 9 and 10 as followes:-

"9. 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 reiterated by this Court in several decisions. To mention a few - Madhavrao Jiwaji Rao Scindia v. Sambhajirao Chandrojirao Angre [1988 (1) SCC 692], State of Haryana v. Bhajanlal [1992 Supp (1) SCC 335], Rupan Deol Bajaj v. Kanwar Pal Singh Gill [1995 (6) SCC 194], Central Bureau of Investigation v. Duncans Agro Industries Ltd., [1996 (5) SCC 591], State of Bihar v. Rajendra Agrawalla [1996 (8) SCC 164], Rajesh Bajaj v. State NCT of Delhi, [1999 (3) SCC 259], Medchl Chemicals and Pharma (P) Ltd. v. Biological E. Ltd. [2000 (3) SCC 269], Hridaya Ranjan Prasad Verma v. State of Bihar [2000 (4) SCC 168], M. Krishnan v. Vijay Kumar [2001 (8) SCC 645], and Zandu Pharmaceutical Works Ltd. v. Mohd. Sharaful Haque [2005 (1) SCC 122]. The principles, relevant to our purpose are :

(i) A complaint can be quashed where the allegations made in 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 the case alleged against the accused.For this purpose, the complaint has to be examined as a whole, but without examining the merits of the allegations. Neither a detailed inquiry nor a meticulous analysis of the material nor an assessment of the reliability or genuineness of the allegations in the complaint, is warranted while examining prayer for quashing of a complaint.

(ii) A complaint may also be quashed where it is a clear abuse of the process of the court, as when the criminal proceeding is found to have been initiated with mala fides/malice for wreaking vengeance or to cause harm, or where the allegations are absurd and inherently improbable.

(iii) The power to quash shall not, however, be used to stifle or scuttle a legitimate prosecution. The power should be used sparingly and with abundant caution.

(iv) The complaint is not required to verbatim reproduce the legal ingredients of the offence alleged. If the necessary factual foundation is laid in the complaint, merely on the ground that a few ingredients have not been stated in detail, the proceedings should not be quashed. Quashing of the complaint is warranted only where the complaint is so bereft of even the basic facts which are absolutely necessary for making out the offence.

(v) A given set of facts may make out : (a) purely a civil wrong; or (b) purely a criminal offence; or (c) a civil wrong as also a criminal offence. A commercial 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 proceedings 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.

10. 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 break down of marriages/families. There is also an impression that if a person could somehow be entangled in a criminal prosecution, there is a likelihood of imminent settlement. Any effort to settle civil disputes and claims, which do not involve any criminal offence, by applying pressure though criminal prosecution should be deprecated and discouraged."

18. The Supreme Court in a recent judgment of Rajiv Thapar V. Madan Lal Kapoor (2013) 3 SCC 330 have discussed the scope of powers of High Court and delineate the the steps to determine the veracity of prayer for quashment raised by accused by invoking the powers vested in High Court under Section 482 Cr.P.C. . The relevant paragraphs 28,29 and 30 are extracted below

"

"28. The High Court, in exercise of its jurisdiction under Section 482 CrPC, must make a just and rightful choice. This is not a stage of evaluating the truthfulness or otherwise of the allegations levelled by the prosecution/complainant against the accused. Likewise, it is not a stage for determining how weighty the defences raised on behalf of the accused are. Even if the accused is successful in showing some suspicion or doubt, in the allegations levelled by the prosecution/complainant, it would be impermissible to discharge the accused before trial. This is so because it would result in giving finality to the accusations levelled by the prosecution/ complainant, without allowing the prosecution or the complainant to adduce evidence to substantiate the same. The converse is, however, not true, because even if trial is proceeded with, the accused is not subjected to any irreparable consequences. The accused would still be in a position to succeed by establishing his defences by producing evidence in accordance with law. There is an endless list of judgments rendered by this Court declaring the legal position that in a case where the prosecution/ complainant has levelled allegations bringing out all ingredients of the charge(s) levelled, and have placed material before the Court, prima facie evidencing the truthfulness of the allegations levelled, trial must be held.

29. The issue being examined in the instant case is the jurisdiction of the High Court under Section 482 CrPC, if it chooses to quash the initiation of the prosecution against an accused at the stage of issuing process, or at the stage of committal, or even at the stage of framing of charges. These are all stages before the commencement of the actual trial. The same parameters would naturally be available for later stages as well. The power vested in the High Court under Section 482 CrPC, at the stages referred to hereinabove, would have far-reaching consequences inasmuch as it would negate the prosecution's/complainant's case without allowing the prosecution/complainant to lead evidence. Such a determination must always be rendered with caution, care and circumspection. To invoke its inherent jurisdiction under Section 482 CrPC the High Court has to be fully satisfied that the material produced by the accused is such that would lead to the conclusion that his/their defence is based on sound, reasonable, and indubitable facts; the material produced is such as would rule out and displace the assertions contained in the charges levelled against the accused; and the material produced is such as would clearly reject and overrule the veracity of the allegations contained in the accusations levelled by the prosecution/complainant. It should be sufficient to rule out, reject and discard the accusations levelled by the prosecution/complainant, without the necessity of recording any evidence. For this the material relied upon by the defence should not have been refuted, or alternatively, cannot be justifiably refuted, being material of sterling and impeccable quality. The material relied upon by the accused should be such as would persuade a reasonable person to dismiss and condemn the actual basis of the accusations as false. In such a situation, the judicial conscience of the High Court would persuade it to exercise its power under Section 482 CrPC to quash such criminal proceedings, for that would prevent abuse of process of the court, and secure the ends of justice.

30. Based on the factors canvassed in the foregoing paragraphs, we would delineate the following steps to determine the veracity of a prayer for quashment raised by an accused by invoking the power vested in the High Court under Section 482 CrPC.

30.1.Step one: whether the material relied upon by the accused is sound, reasonable, and indubitable i.e. the material is of sterling and impeccable quality?

30.2.Step two: whether the material relied upon by the accused would rule out the assertions contained in the charges levelled against the accused i.e. the material is sufficient to reject and overrule the factual assertions contained in the complaint i.e. the material is such as would persuade a reasonable person to dismiss and condemn the factual basis of the accusations as false.?

30.3.Step three: whether the material relied upon by the accused has not been refuted by the prosecution/complainant; and/or the material is such that it cannot be justifiably refuted by the prosecution/complainant?

30.4.step four; whether proceeding with the trial would result in an abuse of process of the court, and would not serve the ends of justice?

30.5. If the answer of all the steps in the affirmative , the judicial conscience of the High Court should persuade it to quash such criminal proceedings in exercise of power vested in it under Section 482 CRPC. Such exercise of power , besides doing justice to the accused, save precious court time , which would otherwise be wasted in holding such a trial (as well as proceedings arising therefrom) specially when it is clear that the same would not conclude in the conviction of the accused."

19. The Apex Court after considering several judgments including judgment in Mohd. Ibrahim Vs. State of Bihar, (2009) 8 SCC 751, in Arun Bhandari Vs. State of U.P. And ors, (2013) 2 SCC 801 held that some time a case may apparently look to be of civil nature or may involve a commercial transaction but such civil disputes or commercial disputes in certain circumstances may also contain ingredients of criminal offences and such dispute have to be entertained notwithstanding they are also civil disputes.

20. The factual matrix of this case as perceived by this Court, stands mainly on the allegation of theft committed by petitioners of signed cheques, signed and unsigned documents belonging to O.P.No.4 and its Company. These cheques and documents were said to have been fabricated and forged with mala fide intention by the accused persons to cause economic loss to O.P.No.4 and his Company. From the perusal of FIR it appears that the alleged theft was committed by accused persons from the office of the Company of O.P. No.4. Admittedly no date and time of alleged theft has been disclosed nor it was shown whether any person witnessed the incident of theft. From the perusal of record of trial court it is clear that nothing was recovered from the possession of accused/petitioner during investigation, as no recovery memo of any documents or cheques said to have been stolen, was placed on record.

21. The ingredients in order to constitute a criminal breach of trust are: (i) entrusting a person with property or with any dominion over property, (ii) that person entrusted (a) dishonestly misappropriating or converting that property to his own use; or (b) dishonestly using or disposing of that property or wilfully suffering any other person so to do in violation (i) of any direction of law prescribing the mode in which such trust is to be discharged, (ii) of any legal contract made, touching the discharge of such trust.

22. The ingredients of an offence of cheating are: (i) there should be fraudulent or dishonest inducement of a person by deceiving him, (ii)(a) the person so deceived should be induced to deliver any property to any person, or to consent that any person shall retain any property; or (b) the person so deceived should be intentionally induced to do or omit to do anything which he would not do or omit if he were not so deceived; and (iii) in cases covered by, (ii)(b) the act of omission should be one which causes or is likely to cause damage or harm to the person induced in body, mind, reputation or property.

23. In this case it is an admitted fact that petitioners gave a sum of Rs. 16,00,000/- to O.P. No.4, out of which according to the allegation made in FIR lodged by O.P. No.4, Rs 2,00,000/- were returned to petitioners through cheque. The rest amount is still with O.P.No.4. From the perusal of allegations made in FIR no property or money was entrusted to the petitioners by O.P. No.4 by himself or on behalf of his Company.

24. There is no allegation that there was fraudulent or dishonest inducement of the petitioners by deceiving the O.P.No.4 to deliver any property. Rather it has been alleged that the petitioners did not turn up to take the shares of Company.

25. In the absence of any entrustment of any property or money to the petitioners by O.P. No.4 no offence under section 406 IPC would be made out. Similarly in the absence of delivery of any property or money by O.P. No.4 or his Company to the petitioners under their dishonest or fraudulent inducement, no offence of cheating could be made out.

26. So far as offence under section 379 and section 411 IPC is concerned, there is only suspicion of theft. No direct evidence of theft is available. No recovery was made from the possession of the accused-petitioners of any property or cheques alleged to have been stolen. The allegations made in FIR revels that out of 10 cheques 3 cheques having No. 715862, 715863 and 715864 Rs.14,30,000/-, Rs.5,30,000/- and 6,75,000/-, respectively were presented and bounced for non availability of funds in the bank account of O.P .No.4 and only than on information received from bank ,the O.P. No.4 found that petitioners filed the cheques making forged and fictitious entries and presented the cheques which were actually the stolen cheques. It is also evident from the allegations made by the O.P. No.4 that accused on 7.10.2001 during course of talks of settlement of accounts admitted to returned the stolen cheques and other documents at 5.00 PM at the establishment. When they came at the establishment/office of O.P. No.4, they said that they will take the money mentioned in the cheques. They also extended threats to life and abused in the presence of Amit Seth and Avadh Naresh Tiwari.

27. Even in the allegations made in FIR no body was named in whose presence the admission was made of return of cheques and other stolen papers by the petitioners. On the contrary, it is a fact that in respect of above mentioned three cheques cases under section 138 N.I.Act were already filed against O.P. No.4 in the court after serving the notice of demand. Therefore, question of return of these cheques, alleged to be stolen, does not arise.

28. Not only this, there is one more cheque having No.715861 was issued in the name of Amit Seth, who has been shown to be the witness of this case. In respect of this cheque a separate FIR has been lodged at case crime No. 166/2002, in which after investigation, final report has been submitted. The matter is still sub-judice.

29. So far as other cheques are concerned, two cheques having No.244145 and 244146 of Rs.8,97,928/- and 11,16,950/-, respectively were also alleged to have been issued to the petitioners by the Company of O.P. No.4, as is evident from the pleadings of petitioners. It is also not denied by O.P. No.4 that two cases under N.I.Act were also pending against the Company of O.P .No.4 in respect of these aforesaid two cheques before initiation of proceedings in question.

30. Not only this, the cheque alleged to have been issued by O.P. No.4 for his Company to one of the petitioners having no. 448515 of Rs. 2,00,000/-, but also shown to be dis-honoured and in respect of which a criminal case having 641 of 2001 under section 138 N.I.Act is also pending on the date of initiation of proceedings in question.

31. It has been submitted by the counsel for the O.P. No.4 that the story set up by the petitioners of advancing loan to O.P. No.4 and its Company is not true and based on all fictitious and false documents. On the other hand, the counsel for the petitioners submitted that the story set up by the O.P. No.4 is concocted and is mala fide as the same is based on concealment of material facts. There shall be a presumption under section 118 N.I. Act in respect of negotiable instruments including the cheques and the presumption could only be rebutted by the person issuing cheque in the same proceeding, in which amount is sought to be recovered or in which the dispute about the non payment of the cheque has been raised, is under consideration. The present prosecution is actually a counter blast of the cases filed by the petitioners under section 138 of N.I.Act.

32. It is true that in this case the case dairy of police has been lost as the same has been weeded out. However the lower Court record is still intact.

33. From the factual matrix of this case, it is clear that from the allegations made in the FIR, even if taken at their face value and accepted in their entirety no offence is made out under section 406, 420 and 411 IPC for the absence of necessary ingredients.

34. So far as the offence under section 379 IPC is concerned, there is no direct evidence. The evidence of extrajudicial confession is alleged, which does not appear to be probable and so absurd on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the petitioners. The material relied upon by the accused would rule out the assertions contained in the charges levelled against the accused-petitioners and the material produced is sufficient to reject and overrule the factual assertions contained in the FIR. The material produced by the petitioners is such as would persuade a reasonable person to dismiss and condemn the factual basis of the accusations made in the FIR as false. Moreover, the material relied upon by the accused-petitioners has not been specifically refuted by O.P. No.4. The material relied upon by the accused-petitioners is such that it cannot be justifiably refuted. If the trial allowed to proceed would result in an abuse of process of the court and would not serve the ends of justice. The pleas taken by way of this prosecution by O.P. No.4 would be available as defence in prosecution under section 138 of N.I.Act and if he succeeds in proving the pleas taken, he may succeed in getting the cases dismissed. The facts and circumstances of this case are depicting a civil and commercial dispute amongst the parties which has been given the cloak of a criminal offence with mala fide intention to put pressure upon the petitioners and for their harassment. In such situation, the criminal courts should ensure that proceedings before it are not used for settling scores or to pressurize to settle the civil dispute. In this matter, the necessary ingredients of prime criminal offences are absent.

35. In view of the above, this court is of the firm view that the proceedings pending in pursuance of cognizance taken upon charge sheet filed in crime case no. 11 of 2002 against the petitioners in the court of IInd Additional Chief Judicial Magistrate, Lucknow having case No.219 of 2003 deserves to be quashed and this petition is liable to be allowed.

36. Consequently, this petition is allowed. The proceedings of case No.219 of 2003, State vs. Gopal Chandra and 2 others, under section 406,420,379,411,504 and 506 IPC, Police station Gomti Nagar, Lucknow connected with case crime No.11 of 2002,and arising out of the charge sheet no.121 of 2002 dated 28.8.2002 filed against the petitioners no. 1,2 and 3 by police in aforesaid crime number on the basis of cognizance taken by the Magistrate vide its order dated 24.01.2003 are quashed.

37. Record of the lower Court be sent back along with copy of judgment forthwith. Office to comply.

Dated: 15th April 2013. (Hon'ble Vishnu Chandra Gupta ,J.)

Santosh