Smt. Shiela Gupta vs State Of U.P. And Another
2022 Latest Caselaw 13612 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD
 
 

A.F.R.
 
Judgment reserved on 13.09.2022
 
Judgment delivered on 26.09.2022
 
Court No. - 84
 

 
Case :- APPLICATION U/S 482 No. - 11657 of 2022
 

 
Applicant :- Smt. Shiela Gupta
 
Opposite Party :- State of U.P. and Another
 
Counsel for Applicant :- Dileep Kumar Pandey
 
Counsel for Opposite Party :- G.A.,Swetashwa Agarwal
 

 
Hon'ble Saurabh Shyam Shamshery,J.

1. Dispute in the present case is arising out of a Committee of Management of Sushila Jaswant Rai Maternity Hospital, Meerut under Jaswant Rai Churamani Trust Society. Undisputedly, the applicant was appointed by a resolution of society dated 02.10.2001 as a Chairman of said hospital and she remained on the said post till 15.02.2019, thereafter, one Rajiv Kumar Gupta was appointed as a Chairman of the said hospital.

2. It is a case of complainant (one of trustee/chairman of the Trust) that said new committee came to know in July, 2020 that applicant in connivance with other accused persons prepared a lease deed by misrepresenting herself to be a trustee of said hospital and executed in favour of Shreya Medicare Private Ltd. through its Director Mridul Sharma w/o Dr. Malay Sharma and handed over major part of hospital to them and thereby caused unlawful loss to society and to hospital and unlawful gain in favour of accused persons.

3. In these circumstances, an F.I.R. was lodged by complainant against the applicant and other accused persons on 07.10.2020 bearing Case Crime No. 676 of 2020 under Sections 420, 467, 468, 471 at Police Station- Civil Lines, District- Meerut. The Investigating Officer conducted investigation and recorded statements of witnesses and came to a conclusion that there were sufficient evidence against applicant and other accused persons for committing offence under Section 420, 406 I.P.C. by applicant and offence under Section 420, 406, 120-B I.P.C. by other accused persons, viz., Mridul Sharma and Dr. Malay Sharma, and a charge sheet was filed, whereof cognizance was taken and summons were issued to applicant and other accused persons. The applicant is aggrieved by above referred criminal proceedings, charge sheet and its cognizance and therefore she is before this Court.

4. Sri Dileep Kumar Pandey, learned counsel for applicant submitted that she is an old lady, who has served as a Chairman of hospital for a long period and acted only for benefit of hospital and trust. She became a trustee as per resolution dated 13.08.1995 and in furtherance of later resolution dated 01.10.2001, she was looking after the affairs of hospital also. Therefore, the applicant has not made any misrepresentation while executing the lease deed. The F.I.R. was filed after six years and there was no explanation for such huge delay. The purpose of lease deed was to meet out day to day expenses of hospital and therefore the purpose was for benefit of hospital and society. There was no wrongful gain to applicant or other accused or wrongful loss to hospital.

5. Learned counsel also pointed out that in the lease deed, it was also specifically mentioned that applicant was Chairman of Management of Committee of hospital at the relevant time, therefore, the applicant has not misappropriated any property nor by cheating and dishonestly, induced any person to deliver any property.

6. Learned counsel also submitted that offence under Sections 406 and 420 I.P.C. cannot go together being an antihesis.

7. The applicant has also lodged an F.I.R. against one Rajiv Gupta and others of complainant side alleging that they have manufactured fictitious documents and forged her signature and present criminal proceedings were counterblast to it. The applicant is presently 90 years old and is suffering from cancer and other old age ailments.

8. The above submissions are vehemently opposed by Sri Srijan Pandey holding brief of Sri Swetashwa Agarwal, learned counsel for opposite party No.2 that during the period of applicant, being Chairman of hospital, not only the lease was executed on throw away price but huge money was also siphoned and for that a separate F.I.R. was lodged on 17.11.2021 against applicant and other accused persons under Section 409 I.P.C.

9. He further submitted that by way of lease, the applicant and other accused persons wanted to encroach upon the property of hospital in order provide monetary benefit to other and to cause loss to the hospital as well as to the society. The hospital is situated in a posh area of Meerut city and monthly rent of Rs. 20,000/- was on very low side. Investigation has already been conducted and there are sufficient evidence that applicant along with other accused person has committed offences under Sections 420, 406 I.P.C. and ingredients thereof are prima facie made out.

10. Heard learned counsel for parties and perused the record.

11. Law on inherent powers of the High Court under Section 482 Criminal Procedure Code 1973 is as under :-

"(I) "Inherent Power" of the High Court under Section 482 Cr.P.C., an extraordinary power is with purpose and object of advancement of justice, which is to be exercised "to give effect to any order under the Cr.P.C.", or "to prevent abuse of process of any Court", or "to secure ends of justice", making arena of the power very wide, yet it is to be exercised sparingly, with great care and with circumspection, that too in the rarest of rare case.

(II) It is no more res integra that exercise of inherent power could be invoked to even quash a criminal proceeding/First Information Report/complaint /chargesheet, but only when allegation made therein does not constitute ingredients of the offence/offences and /or are frivolous and vexatious on their face, without looking into defence evidence, however such power should not be exercised to stifle or cause sudden death of any legitimate prosecution. Inherent power does not empower the High Court to assume role of a trial court and to embark upon an enquiry as to reliability of evidence and sustainability of accusation, specifically in a case where the entire facts are incomplete and hazy. Similarly quashing of criminal proceedings by assessing the statements under section 161 Cr.P.C. at initial stage is nothing but scuttling a full fledged trial.

(III) There can not be any straight jacket formula for regulating the inherent power of this Court, however the Supreme Court has summarised and illustrated some categories in which this power could be exercised in catena of judgments. Some of them are State of Haryana Vs Bhajan Lal : 1992 Supp (1) SCC 335, Zandu Pharmaceutical Works Ltd Vs Mohd Sharaful Haque: (2005) 1 SCC 122, Ahmed Ali Quarashi and Anr Versus The State of Uttar Pradesh : 2020 SCC Online SC 107, Joseph Salvaraja A v. State of Gujarat (2011) 7 SCC 59, Sushil Sethi and another Vs The State of Arunachal Pradesh and others (2020) 3 SCC, 240, Priti Saraf and Anr Vs State of NCT of Delhi and Anr : 2021 SCC Online SC 206. Some categories/ circumstances as illustrations but not exhaustive are : allegations made in FIR / complaint, if are taken at their face value and accepted do not prima facie constitute any offence or are so absurd and inherently improbable to make out any case or no cognizable offence is disclosed against the accused, criminal proceedings is maliciously instituted with an ulterior motive and with a view to spite the accused due to private and personal grudge, or where there is a specific legal bar engrafted in any of the provisions of the Code or in the concerned Act to the institution and continuance of the proceedings or when dispute between the parties constitute only a civil wrong and not a criminal wrong, further Courts would not permit a person to be harassed although no case for taking cognizance of the offence has been made out.

(IV) In Sau. Kamal Shivaji Pokarnekar v. The State of Maharashtra : (2019) 14 SCC 350, the Apex Court has laid emphasis on the principles laid down in two of its previous judgements namely, State of Karnataka v. M. Devendrappa : 2015 (3) SCC 424 and Indian Oil Corporation v. NEPC India Ltd. & Ors.: (2006)6 SCC 736 and held that quashing of criminal proceedings is called for only when the complaint does not disclose any offence, or the complaint is frivolous, vexatious, or oppressive and further clarified that defences available during a trial and facts/aspects whose establishment during the trial may lead to acquittal cannot form the basis of quashing a criminal complaint. The criminal complaints cannot be quashed only on the ground that the allegations made therein appear to be of a civil nature, if the ingredients of the alleged offence are prima facie made out in the complaint.

(V) The Supreme Court in M/s Neeharika Infrastructure Pvt. Ltd Versus State of Maharashtra and Others : (2020) 10 SCC 118, has categorically held that High Court is not justified in passing the order of not to arrest and or no coercive steps either during the investigation or till the final report/ charge sheet is filed under Section 173 Cr.P.C., while dismissing/disposing petition under Section 482Cr.P.C. and/or under Article 226 of the Constitution and even in exceptional cases where High Court is of the opinion that a prima facie case is made out for stay of further investigation,such order has to be with brief reasons, though such orders should not be passed routinely, casually and/or mechanically.

(VI) Whether the allegations are true or untrue, would have to be decided in the trial. In exercise of power under Section 482 of the Cr.P.C., the Court does not examine the correctness of the allegations in a complaint except in exceptionally rare cases where it is patently clear that the allegations are frivolous or do not disclose any offence. (see Ramveer Upadhyay & Anr. versus State of U.P. & Anr. 2022 SCC Online SC 484)

(VII) A careful reading of the complaint, the gist of which we have extracted above would show that none of the ingredients of any of the offences complained against the appellants are made out. Even if all the averments contained in the complaint are taken to be true, they do not make out any of the offences alleged against the appellants. Therefore, we do not know how an FIR was registered and a charge-sheet was also filed.....It is too late in the day to seek support from any precedents, for the proposition that if no offence is made out by a careful reading of the complaint, the complaint deserves to be quashed. (See, Wyeth Limited & others vs, State of Bihar & another, Criminal Appeal No.1224 of 2022 (Special Leave Petition (Crl.) No.10730 OF 2018), decided on 11th August, 2022)."

12. The Supreme Court in the case of Vijay Kumar Ghai and others vs. State of West Bengal and others, (2022) 7 SCC 124 has interpreted Sections 405, 406, 415 and 420 I.P.C. Relevant paragraphs of the judgment are quoted hereinbelow :-

"27. Section 405 of IPC defines "Criminal Breach of Trust" which reads as under: -

"405. Criminal breach of trust.--Whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied, which he has made touching the discharge of such trust, or wilfully suffers any other person so to do, commits "criminal breach of trust".

The essential ingredients of the offense of criminal breach of trust are:-

(1) The accused must be entrusted with the property or with dominion over it,

(2) The person so entrusted must use that property, or;

(3) The accused must dishonestly use or dispose of that property or wilfully suffer any other person to do so in violation,

(a) of any direction of law prescribing the mode in which such trust is to be discharged, or;

(b) of any legal contract made touching the discharge of such trust.

28. "Entrustment" of property under Section 405 of the Indian Penal Code, 1860 is pivotal to constitute an offence under this. The words used are, ''in any manner entrusted with property'. So, it extends to entrustments of all kinds whether to clerks, servants, business partners or other persons, provided they are holding a position of ''trust'. A person who dishonestly misappropriates property entrusted to them contrary to the terms of an obligation imposed is liable for a criminal breach of trust and is punished under Section 406 of the Penal Code.

29. The definition in the section does not restrict the property to movables or immoveable alone. This Court in R K Dalmia vs Delhi Administration, (1963) 1 SCR 253 held that the word ''property' is used in the Code in a much wider sense than the expression ''moveable property'. There is no good reason to restrict the meaning of the word ''property' to moveable property only when it is used without any qualification in Section 405.

30. In Sudhir Shantilal Mehta Vs. CBI, (2009) 8 SCC 1 it was observed that the act of criminal breach of trust would, Interalia mean using or disposing of the property by a person who is entrusted with or has otherwise dominion thereover. Such an act must not only be done dishonestly but also in violation of any direction of law or any contract express or implied relating to carrying out the trust.

31. Section 415 of IPC define cheating which reads as under: -

"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"."

The essential ingredients of the offense of cheating are:

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 no 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.

32. A fraudulent or dishonest inducement is an essential ingredient of the offence. A person who dishonestly induces another person to deliver any property is liable for the offence of cheating.

33. Section 420 IPC defines cheating and dishonestly inducing delivery of property which reads as under: -

"420. Cheating and dishonestly inducing delivery of property. --Whoever cheats and thereby dishonestly induces the person deceived to deliver any property to any person, or to make, alter or destroy the whole or any part of a valuable security, or anything which is signed or sealed, and which is capable of being converted into a valuable security, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine."

34. Section 420 IPC is a serious form of cheating that includes inducement (to lead or move someone to happen) in terms of delivery of property as well as valuable securities. This section is also applicable to matters where the destruction of the property is caused by the way of cheating or inducement. Punishment for cheating is provided under this section which may extend to 7 years and also makes the person liable to fine.

35. To establish the offence of Cheating in inducing the delivery of property, the following ingredients need to be proved:- 1. The representation made by the person was false 2. The accused had prior knowledge that the representation he made was false. 3. The accused made false representation with dishonest intention in order to deceive the person to whom it was made. 4. The act where the accused induced the person to deliver the property or to perform or to abstain from any act which the person would have not done or had otherwise committed.

36. As observed and held by this Court in the case of Prof. R.K. Vijayasarathy & Anr. Vs. Sudha Seetharam & Anr., (2019) 16 SCC 739 the ingredients to constitute an offence under Section 420 are as follows:-

i) a person must commit the offence of cheating under Section 415; and

ii) the person cheated must be dishonestly induced to;

a) deliver property to any person; or

b) make, alter or destroy valuable security or anything signed or sealed and capable of being converted into valuable security. Thus, cheating is an essential ingredient for an act to constitute an offence under Section 420 IPC."

(emphasis supplied)

13. The Court now proceeds to deal with rival submissions. The first submission of learned counsel for applicant was that there was a delay of six years in lodging an F.I.R., therefore, it was an afterthought only to harass the applicant. No doubt that there was a delay of six years in lodging of F.I.R., however, as stated by counsel for opposite party No.2 that new Management Committee took over in the year 2019 and after going through the documents it was revealed that the lease deed was made by misrepresentation. Otherwise also, only on the ground that there was a delay in lodging of first information report, entire criminal proceedings could not be set aside ignoring the contents of F.I.R. and investigation thereof.

14. Now, the Court further proceeds to consider whether prima facie ingredients of Section 405 I.P.C. are made out or not. As referred above that ingredients of offence of criminal breach of trust are entrustment with property and thereafter dishonestly disposal of said property. Undisputedly, the applicant was a Chairman of the hospital, therefore, she along with other members of Management Committee, made an entrustment of the trust's property. Therefore, disposal of said property with dishonest intention was in violation of conditions express or implead carrying out the trust, management of hospital, when she was not authorized to execute a lease, therefore, it was in violation of express term of carrying out the trust and definitely, therefore, it would fall under the offence of criminal breach of trust.

15. There are allegations against applicant that she dishonestly executed a lease in favour of other accused only to usurp the property and to cause unlawful loss to the hospital and unlawful gain to other accused persons and the allegations were found to be true after investigation and now charge sheet has been filed. Therefore, ingredients of Sections 405 I.P.C. are prima facie made out.

16. Lastly, the Court has to see whether ingredients of Section 420 I.P.C.(cheating and dishonestly inducing delivery of property) are made out or not. During investigation, it has come that the applicant was not authorized to execute a lease, however, she misrepresented herself to be a trustee of hospital whereas admittedly she was a Chairman of the hospital at the relevant point of time and the lease deed was executed at throw away price without any termination clause and as such it was wrongful loss to the society and therefore, prima facie ingredients of cheating and dishonesty are present and as such offence under Section 420 I.P.C. is also prima facie made out.

17. As discussed above, when on the basis of evidence on record, prima facie a case is made out and ingredients thereof are present, this Court cannot exercise inherent powers which will cause sudden death of criminal proceedings. The facts and circumstances of present case, therefore, do not fall under category that '' allegations are frivolous' or ''do not disclose any offence' and therefore, it does not fall under ''exceptionally rare cases' wherein exercise of inherent powers is warranted.

18. In view of above consideration and analysis, I do not find any ground to quash the criminal proceedings against the applicant and as such this application is rejected.

Order Date :- September 26, 2022

Nirmal Sinha

[Saurabh Shyam Shamshery, J.]