Delhi High Court

Narender Kumar Jain vs State Of N.C.T. Of Delhi & Anr on 18 December, 2009

Author: V. K. Jain

*     IN THE HIGH COURT OF DELHI AT NEW DELHI

+                     CRL.M.C. 69/2009

%                     Date of Order : 18th December, 2009

#     NARENDER KUMAR JAIN                    ..... Petitioner
!                       Through Mr.Sudhir Nandrajog,
                        Sr.Advocate with Mr.Ashutosh
                        Lohia, Advocate.
                   versus
$     STATE OF N.C.T. OF DELHI & ANR.       ..... Respondent

      !                 Through Mr.Sidharth Luthra,
                        Sr.Advocate with Mr.Ankur Garg,
                        Adv. for R-2.

*     CORAM:
      HON'BLE MR. JUSTICE V.K. JAIN

      1.   Whether the Reporters of local papers
           may be allowed to see the judgment?               Yes

      2.   To be referred to the Reporter or not?            Yes

      3.   Whether the judgment should be
           reported in the Digest?                           Yes


: V.K. JAIN, J. (oral)

1. This is a petition under Section 482 of the Code of Criminal

Procedure for quashing FIR No.249/2008 lodged by respondent

No.2 at Police Station Rajinder Nagar under Sections 420/406/506

of IPC.

2. A perusal of the FIR would show that the petitioner agreed

to sell half undivided portion of property bearing No.R-750, New

Rajinder Nagar, New Delhi, to respondent No.2 for a sale

consideration of Rs.24,62,500/-. A sum of Rs.24 lakhs was paid to

the petitioner by way of five cheques issued in his favour and an

Agreement to Sell was executed on 25.6.2005 acknowledging the

payment. A sum of Rs.4,62,500/- was also paid in cash to the

petitioner on that date. This is also the case of the

complainant/respondent No.2 that on 25.6.2005 itself, the

petitioner handed over the physical possession of the area which

was in his exclusive possession and also delivered symbolic

possession of the remaining portion of his share. The actual

physical possession of that portion was to be handed over to him

after getting the same vacated from its occupants. Documents,

such as Will, Special Power of Attorney and Possession Letter etc.

were also executed in favour of the complainant. A civil suit filed

by the petitioner for possession of the portion alleged to have

been in illegal occupation is pending in Civil Court. According to

the complainant, the petitioner executed the Sale Deed in his

office on 11.3.2008 and at that time, he took away the original

Agreement to Sell on the representation that since Sale Deed has

been prepared and signed, there was no need of the Agreement.

The grievance of the complainant is that despite taking money

from him and executing the sale deed, the petitioner had not

come forward to present it for registration on one pretext or the

other. It has also been alleged that the petitioner was

threatening, intimidating and blackmailing the complainant

demanding more money over and above the agreed sale

consideration.

3. It is settled proposition of law that cheating is made out if

there was fraudulent or dishonest intention at the very inception

of the transaction i.e. at the time when the promise or

representation was made. In Hira Lal Hari Lal Bhagwati vs.

Central Bureau of Investigation 2003 AIR(SC) 2545, the

Hon'ble Supreme Court held that for establishing the offence of

cheating, the complainant is required to show that the accused

had fraudulent intention at the time of making promise or

representation. It was further held that from his making failure,

to keep up promise subsequently such a culpable intention right

at the beginning, i.e., at the time when the promise was made

cannot be presumed. Similar view was taken in K.C. Builders

vs. Assistant Commissioner of Income Tax, 2004 (2) SCC

731, Alpic Finance Ltd. vs. P. Sadasivan and Anr. (2001) 3

SCC 513, V.Y. Jose & Anr. Vs. State of Gujarat & Anr. 2009 I

AD (Cr.) (S.C.) 567. In Anil Mahajan Vs. Bhor Industries, 2005

(10) SCC 228, the Hon'ble Supreme Court, inter alia, observed

that the substance of the complaint is to be scene and mere use

of expression 'cheating' in the complaint is of no consequence.

Therefore, unless the complainant is able to show that the

petitioner had a dishonest or fraudulent intention at the time he

entered into sale agreement with him, cheating would not be

made out. There is no allegation made to the FIR which would

indicate any fraudulent or dishonest intention on the part of the

petitioner at the time, he entered into sale transaction with the

complainant. The petitioner handed over vacant portion of the

possession occupied by him. He also gave symbolic possession

of the portion which was occupied by one Mr.Basant Lal Chopra.

He has not withdrawn the civil suit filed by him for possession of

the remaining portion. In these circumstances, it cannot be said

that there was any fraudulent or dishonest intention on the part

of the petitioner, when he entered into sale agreement with the

complainant and accepted money from him.

4. It was contended by the learned counsel for the

complainant that vide para 2 of the sale deed, the petitioner

assured the complainant that the property, subject matter of the

transaction, was free from all prior disputes etc. whereas in fact a

dispute was admittedly going on between the petitioner and

Mr.Basant Lal Chopra as regards possession of the portion

occupied by Mr.Basant Lal Chopra. A perusal of the FIR would

show that the complainant knew since very beginning that there

was a dispute between the petitioner and Mr.Basant Lal Chopra

as regards the portion occupied by Mr.Basant Lal Chopra and that

is why only symbolic possession of that portion was given to him.

The physical possession of that portion was to be given to him by

the petitioner only after getting it vacated from Mr.Basant Lal

Chopra. Therefore, no fraudulent or dishonest intention on the

part of the petitioner can be inferred on account of this averment

made in the sale deed.

5. As regards the allegation that the original Agreement to Sell

was taken aback by the petitioner while signing the Sale Deed, it

has been rightly pointed out by the learned counsel for the

petitioner that once the Sale Deed had been signed by the

petitioner, the Agreement to Sell lost all its significance since this

is not the case of the complainant that the covenants contained

in the Agreement to Sell are not part of the sale deed signed by

the petitioner. In any case, once the sale deed is signed, the

terms and conditions settled between the parties merge into the

covenants contained in the sale deed and the parties are

thereafter bound by those very covenants.

6. Mere failure, on the part of the petitioner to get the Sale

Deed registered, would not constitute cheating unless it is shown

that at the time, he executed Agreement to Sell in favour of the

complainant, he did not have any intention to execute the sale

deed in his favour. In fact, the conduct of the petitioner in

handing over physical possession of the portion occupied by him,

giving symbolic possession of the portion occupied by Mr.Basant

Lal Chopra and signing the sale deed at the place of complainant

show that at least till the time he signed the sale deed, there was

no dishonest intention on the part of the petitioner. Once the

sale deed had been signed, what remained was only presentation

of the sale before the Sub-Registrar for the purpose of

registration.

7. In State of Haryana vs. Bhajan Lal, AIR 1992 SC 604,

the Hon'ble Supreme Court held that where the allegations made

in the FIR 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 any case against the accused,

the court would be justified in quashing the criminal proceedings

in exercise of powers u/s 482 of Code of Criminal Procedure.

If the allegations disclose a civil dispute but also constitute

an offence, that by itself cannot be a ground to hold that the

criminal proceedings should not be allowed to continue, but,

where the allegations made in the complaint, even if taken on

their face value do not disclose commission of any offence, the

court would be justified in taking recourse of taking provisions of

Section 482 of the Code of Criminal Procedure.

8. In the case of V.Y. Jose & Anr. Vs. State of Gujarat &

Anr. 2009 (supra) the Hon'ble Supreme Court, inter alia,

observed as under:-

"Section 482 of the Code of Criminal Procedure, saves the inherent power of the court. It serves a salutary purpose viz. a person should not undergo harassment of litigation for a number of years although no case has been made out against him.

It is one thing to say that a case has been made out for trial and as such the criminal proceedings should not be quashed but it is another thing to say that a person should undergo a criminal trial despite the fact that no case has been made out at all."

9. In Inder Mohan Goswami and Another vs. State of

Uttranchal and Others (2007) 12 SCC 1, the Hon'ble Supreme

Court, while quashing all the proceedings emanating from the

FIR, inter alia, observed as under:

"The Court must ensure that criminal prosecution is not used as an instrument of harassment or for seeking private vendetta or with an ulterior motive to pressurise the accused."

In Indian Oil Corporation versus N.E.P.C. India Ltd.

(2006) 6 SCC 736, the Hon'ble Supreme Court cautioned against

a growing tendency in business circles to convert purely civil

disputes into criminal cases. The Hon'ble Court observed

that:-

"Any effort to settle civil disputes and claims, which do not involve any criminal offence, by applying pressure through criminal prosecution should be deprecated and discouraged."

10. The present case appears to be an attempt to solve a

dispute which is purely of civil nature, by putting pressure on the

petitioner by initiating criminal proceedings against him. The

allegations made in the FIR, even if taken as correct and on their

face value, do not constitute any criminal offence, and therefore,

the guidelines laid down by the Supreme Court in the case of

Bhajan Lal (supra) squarely apply to the present case.

11. As regards the alleged threat, I find that there is no specific

allegation in the complaint. The complainant does not say on

which date the threat was given to him, what precisely was the

threat and where it was given. The allegations made in this

regard being absolutely vague and general in nature cannot be