M.P.Singh Sahni vs State & Ors.
2013 Latest Caselaw 2548 Del

*     IN THE HIGH COURT OF DELHI AT NEW DELHI

                              RESERVED ON : 1st FEBRUARY, 2013
                               DECIDED ON : 30th MAY, 2013

+            CRL.M.C.3772/2003 & CRL.M.A.5091/2003

      M.P.SINGH SAHNI                          ....Petitioner
                Through :       Mr.M.P.Singh Sahni in person.

                                versus

      STATE & ORS.                          ....Respondents
               Through :        Mr.Harnam Singh in person.

       CORAM:
       HON'BLE MR. JUSTICE S.P.GARG

S.P.GARG, J.

1. M.P.Singh Sahni (hereinafter referred as the petitioner or

accused) has preferred various petitions CRL.M.C.Nos. 3772/2003, 2444-

45/2005, 54/2008, 2790/2000, 3773/2003, 3779/2003, 3781/2003,

3782/2003, 3784/2003, 3193/2005 and 3783/2003 for quashing of the

various criminal proceedings initiated against him by Harnam Singh

(hereinafter referred as complainant or respondent No.2).

2. Case of the complainant is that he is a highly qualified ex-

banker having an experience of seventeen years. He was earlier posted at

Senior Executive level in a Nationalized Bank. The petitioner and his wife

Narider Pal Kaur Sahni engaged him to provide professional services in

respect of non-delivery of 40,000 shares of M/s.Essar Gujarat Ltd. and for

clearance of 11 FDRs with Kuwait International Finance Company

(KIFCO). For that purpose, an agreement dated 22.07.1991 and

irrevocable Power of Attorney dated 01.08.1991 were executed.

Supplementary agreement dated 09.10.1992 was also executed. Again, an

agreement/ memorandum of understanding dated 07.03.1995 and

subsequent agreement dated 14.03.1995 were executed along with

irrevocable General Power of Attorney (GPA) dated 18.05.1995 in his

favour. He filed complaint with the National Consumer Dispute Redressal

Commission; Civil Suit bearing No.2436/1996 against M/s.Essar Gujarat

Ltd. and incurred expenses from his pocket. Vide notice dated 22.10.1997,

the petitioner through his counsel Mr.Arvind Kumar Gupta, Advocate

cancelled the GPA dated 18.05.1995. He sent reply to the petitioner on

25.10.1997.

3. Petitioner's case is that he is a Non Resident Indian and is

residing in Kuwait for the last 30 years with his family. He is doing

business in Kuwait. He had fixed deposits with Bank of Credit and

Commerce International (BCCI), Bombay to the tune of US $8,23,348.

The FDRs were pledged with Kuwait Investment Finance Company

(KIFCO) against some loan. There were some dispute between him and

KIFCO. To protect his interest, he secured the services of the complainant

and agreement dated 22.07.1991 was executed whereby the complainant

was to get 5% as professional fee on the amount realized in India.

Subsequent agreement was also executed in which the professional fee

was increased to 7% for clearance of one FDR No.1798. The respondent

No.2 filed suit in 1993 after an inordinate delay. Since the respondent

No.2 was unable to protect his interest, he was forced to cancel GPA

executed in his favour. Thereafter, the litigation started between the

parties.

4. On 01.02.2013, the petitioner opted to address arguments

without the assistance of his lawyer. The respondent No.2 also opted to

address arguments himself. Common arguments in all the petitions were

addressed by both.

5. The petitioner urged that the respondent has implicated him

in numerous false and frivolous cases. When he cancelled GPA executed

in his favour, the respondent No.2 started lodging false complaints on

frivolous grounds. He did not commit any offence. Respondent No.2's

only motive to file complaint cases against him was to extract money as

he was unable to pursue those cases being an NRI residing in Kuwait. He

did not forge any document. He had no intention to defame him any time.

He had reposed confidence in him and had availed his professional

services to get clear his FDRs and to get back 40,000 shares. The

respondent No.2 did not account for the amount received and illegally

retained the shares handed over by M/s. Essar Company.

6. The petitioner filed written synopsis and relied upon the

authorities : 'Suryalakshmi Cotton Mills Limited vs. Rajvir Industries

Limited and ors.' : (2008) 13 SCC 678, 'All Cargo Movers (India) Private

Limited and ors. Vs. Dhanesh Badarmal Jain and anr.' : (2007) 14 SCC

776, 'M/s. Indian Oil Corporation vs. M/s. NEPC India Ltd and ors.' :

AIR 2006 (SC) 2780 & 'Dr.P.Sharma vs. P.S.Popli and anr.' : 2002 (1)

JCC 66.

7. The respondent No.2/ complainant urged that the petitioner is

a big fraud and a habitual offender. He concealed the material fact that

earlier Crl.M.M. 2207/1999 was filed by him for quashing of the

complaint cases. He made false statements and on 01.07.1999, moved two

applications before the learned Metropolitan Magistrate for recalling of

the summoning order and for exemption of personal appearance. The

exemption for appearance was 'allowed' and not 'dismissed' as stated in

the petition No.2790/2000. He simultaneously filed Revision 592/1999

(New No.1/2000) before learned Additional Sessions Judge during the

pendency of the petition before this Court and did not disclose the same in

his revision. The present petitions for quashing of the cases are not

maintainable as the matters are still at initial stage and the petitioner has

not appeared in many cases so far. He further argued that petitioner

deliberately omitted/ deleted 24 important words from the orders of

learned Additional Sessions Judge dated 01.07.2000 and added two words

of its own which were not in the order. The petitioner made false

statement that ` 3.25 lacs were given in cash to him in Kuwait in Petition

No.2790/00. No cash payment was ever received by him in Kuwait on

05.07.1997 and no receipt of said cash was executed. The petitioner did

not file any such receipt in the Court. Contrary to that, he had given

written instructions to Babli, his brother-in-law to issue two cheques from

his account. These two cheques were found forged. Charge-sheet have

been filed against the petitioner. The petitioner gave false/ contrary

statement of non issuance of cheque of ` 3.25 lacs which is a disputed

fact. The petitioner cheated him by issuing forged cheques for ` 3.25 lacs

and also misrepresenting him by various means that he had settled the

dispute with KIFCO for 3 lacs Kuwait Dinar. He obtained various

undertakings by deceitful means to cause wrongful loss to him. He filed

suit for Rendition of Accounts in July, 1997. After coming to know about

settlement, he filed complaint under Section 420 IPC in December, 1997

and the said suit was dismissed in default on 28.08.1998. He further

argued that General Power of Attorney dated 01.08.1991 was irrevocable

and was for valuable consideration. By cancelling the same, the petitioner

committed breach of trust. From the judgments passed by District Courts,

New York, USA, it reveals that the petitioner committed fraud of

approximate 8.60 millions US Dollars i.e. approximately ` 50 crores by

forgery, cheating etc. He is a part of an international shipping frauds

syndicate that runs of shadow operation across the globe, employs

numerous shifting identities and dummy corporations and assaults official

witnesses, bribes and defrauds Government officials. It was specifically

observed that Mohinder (sic petitioner) had not conducted himself in a

trustworthy manner. The petitioner falsely claimed that he was not the

same Mohinder Singh Sahni named in the original complaint. He

attempted to fool Judge Casey as to his identity. He posed himself as

Jogender at the April, 2004 meetings. In the present petitions, the

petitioner has claimed that he is Mohinder Pal Singh Sahni and not

Mohinder Singh Sahni. He is having two passports one in the name of

Mohinder Pal Singh Sahni and another in the name of Mohinder Singh

Sahni. He further argued that FIR was registered by Crime Branch

Mumbai on the complaint of Bank of Bahrein at Kuwait vide FIR/MCR

2/2001 under Sections 467/420/468/471/120B IPC. He further argued that

in Crl.M.M.3193/05, the petitioner used/ filed copies of various medical

certificates dated 20.05.1999, 07.06.1999 and 30.06.1999.

8. The respondent /complainant filed supplementary written

submissions to state that after the judgments/ orders were reserved,

Insp.Satya Pal Singh of PS Tilak Nagar filed status report in the Court of

Ms.Navita Bagha, Metropolitan Magistrate and it was stated that the

certificates did not carry attestation of the concerned authority and not

signed by two doctors and directors of the Hospital as per the ministerial

decisions applied therefor.

9. He relied upon the authorities : 'State of A.P. and anr. Vs.

T.Suryachandra Rao' : (2005) 6 SCC 149, 'Rajinder Prasad vs. Bashir

and ors' : AIR 2001 SC 3524, 'Satish Khosla vs. Eli Lilly Ranbaxy Ltd.' :

1998 (1) JCC (Delhi) 54, 'Kuldeep Kapoor vs. Susanta Sengupta' : 126

(2006) DLT 149, 'Suo Motu Proceedings against Mr.R.Karuppan' : 2001

CRI.L.J. 2611 & 'Gangawwa vs. State of Mysore' : AIR 1969 MYSORE

114.

10. It is also relevant to note that summoning of accused in a

criminal case is a serious matter. Hence criminal law cannot be set into

motion as a matter of course. The order of Magistrate summoning the

accused must reflect that he had applied his mind to the facts of the case

in the law applicable thereto. The Magistrate has to record his satisfaction

with regard to existence of a prima facie case on the basis of specific

allegations made in the complaint supported by satisfactory evidence and

other material on record.

11. In 'Pepsi Foods Ltd and Anr. v. Special Judicial Magistrate

and Ors.', 1998 SCC 1400, the Supreme Court held :

'28. Summoning of an accused in a criminal case is a serious matter. Criminal law cannot be set into motion as a matter of course. It is not that the complainant has to bring only two witnesses to support his allegations in the complaint to have the criminal law set into motion. The order of the Magistrate summoning the accused must reflect that he has applied his mind to the facts of the case and the law applicable thereto. He has to examine the nature of allegations made in the complaint and the evidence both oral and documentary in support thereof and would that be sufficient for the complainant to succeed in bringing charge home to the accused. It is not that the Magistrate is a silent spectator at the time of recording of preliminary evidence before summoning of the accused. The Magistrate has to carefully scrutinise the evidence brought on record and may even himself put questions to the complainant and his witnesses to elicit answers to find out the truthfulness of the allegations or otherwise and then examine if any offence is prima facie committed by all or any of the accused.'

12. In 'Indian Oil Corporation vs. NEPC India Ltd. and Ors.',

AIR 2006 SC 2780, the Supreme Court held :

'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. In G. Sagar Suri v. State of UP : 2000CriLJ824 , this Court observed:

It is to be seen if a matter, which is essentially of civil nature, has been given a cloak of criminal offence. Criminal proceedings are not a short cut of other remedies available in taw. 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 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.

While no one with a legitimate cause or grievance should be prevented from seeking remedies available in criminal law, a complainant who initiates or persists with a prosecution, being fully aware that the criminal proceedings are unwarranted and his remedy lies only in civil law, should himself be made accountable, at the end of such misconceived criminal proceedings, in accordance with law.

One positive step that can be taken by the courts, to curb unnecessary prosecutions and harassment of innocent parties, is to exercise their power under Section 250 Cr.P.C. more frequently, where they discern malice or frivolousness or ulterior motives on the part of the complainant. Be that as it may.'

13. The petitions filed by the petitioner are being considered in

the light of above facts and law.

14. Present petition under Section 482 Cr.P.C. has been preferred

for quashing of complaint case filed by respondent No.2/ complainant

under Section 420 IPC in which vide order dated 26.04.1999, he was

summoned for committing offence sunder Section 417 IPC.

15. The respondent No.2 filed complaint case against the

petitioner alleging that vide agreement dated 22.07.1991, he was entitled

to get 5 % as professional charges for clearance of 11 FDRs lying with

Bank of Bahrain and Kuwait, Bombay. The petitioner had told him that

against these 11 FDRs, he had taken a total amount of Kuwait Dinar

1,90,000/- as loan from the Kuwait office of the Bank and the same was

already paid back to it. The petitioner also executed GPA (irrevocable) on

01.08.1991 in his favour to pursue the matter on his behalf. Vide another

agreement dated 09.10.1992, the petitioner enhanced the professional fee

to 7% against clearance of FDR No.1798. The complainant alleged that

the petitioner had concealed a material fact that he had also taken a loan/

advance/ amount worth US dollars 2 million in April, 1990 against/for

FDR No.1798. Had he disclosed the said material fact, he would not have

taken any consequential action seeking clearance of the aforesaid FDR.

He would have dissuaded and restrained himself from filing a suit before

Delhi High Court seeking Temporary and Permanent injunction against

the Bank of Bahrain and Kuwait, Bombay Branch and would not have

incurred unnecessary expenses on litigation. He had to spend lot of time,

money and energy to pursue the matter with the Bank. The petitioner had

earlier claimed in the pleadings that he had not taken any

loan/amount/advance in April, 1990 in Kuwait amounting to US dollars 2

millions against the FDR No.1798. However, in suit No.2571/1994 filed

by the Bank before a Court in Kuwait, he admitted in the pleading that he

had deposited US dollars of 2 million in cash at Bombay Branch of the

Bank. When the complainant protested to the accused, he revoked GPA

executed in his favour. The petitioner caused substantial harm to the

complainant in body, mind and reputation and he was cheated. The

complainant examined himself as CW-2 besides examining A.K.Pandey,

Deputy Secretary, Special Kuawait Cell, Ministry of External Affairs as

CW-1. The Trial Court was, prima facie, of the view that the allegations

made in the complaint and evidence were sufficient to proceed against the

accused/ petitioner under Section 417 IPC.

16. Indisputably, professional services of the complainant were

taken by the petitioner to get release 11 FDRs lying with Bank of Bahrain

and Kuwait, Bombay Branch. Agreement dated 22.07.1991 was executed

in that connection and the complainant was entitled to get 5 % as

professional charges. Subsequently, vide agreement dated 09.10.1992, the

professional fee was raised to 7% qua FDR No.1798. The petitioner also

executed general power of attorney in his favour to pursue the matter on

his behalf with the authorities concerned. Apparently, the complainant

was to act for the clearance of the FDRs as an 'attorney' of the accused

and was entitled to get his professional fee. If there was concealment of

any material fact regarding the clearance of the FDRs, it was the petitioner

who was to suffer. In any situation, the complainant was entitled to the

professional fee agreed to in the agreements relied upon by him. The

dispute, if any, was for the payment of the professional fee. There was no

occasion for the petitioner to conceal raising of loan of US 2 million

dollars on the FDR No.1798 from his 'attorney'. This fact must have been

revealed by the concerned bank in the proceedings initiated against it. It is

unclear as to how the complainant who acted petitioner's attorney and was

entitled to professional payments would have dissuaded himself from

instituting the proceedings due to concealment of the alleged facts. There

is no cogent proof about the raising of the said loan/amount against the

FDR No.1798. The petitioner had filed an affidavit in the proceedings

denying any such loan. Again, it was the petitioner who was to suffer for

filing false affidavit (if any).

17. Admittedly, the complainant had filed Suit No.216/1997

(New No.S-363/1998) for recovery of his professional fee i.e. Suit for

Rendition of Account/ Recovery against the petitioner, SBI Commercial

& International Bank and Bank of Bahrain and Kuwait, Bombay Branch

in August, 1996. It is admitted that the said suit was dismissed in default

on 28.08.1998.

18. Another Suit No.556/1997 was filed by the complainant for

Rendition of Accounts in the Court of Sh.S.S.Bal, ADJ. It is relevant to

note that when the case was fixed for arguments on the application moved

by the accused under Order 7 Rule 11 CPC, the complainant opted to

withdraw the said suit by moving application under Section 151 CPC

pleading that he had filed a criminal complaint in which the accused was

summoned under Section 417 IPC. The said suit was dismissed as

withdrawn vide order dated 01.07.1999.

19. Contents of the complaint do not disclose commission of

offence under Section 415 IPC punishable under Section 417 IPC. Mere

breach of contract (if any) cannot give rise to criminal prosecution for

cheating unless fraudulent or dishonest intention is shown right at the

beginning of the transaction, i.e. the time when the offence is said to have

been committed. It is the intention which is the gist of the offence. To

hold a person guilty of cheating, it is necessary to show that he had

fraudulent or dishonest intention at the time of making the promise. From

his mere failure to keep up promise subsequently, such a culpable

intention right at the beginning, that is, when he made the promise cannot

be presumed. It is well settled that when the aggrieved party has an

alternative remedy in the Civil Courts, the matter should not be allowed to

be filed in Criminal Courts. A concealment of facts cannot be said to be

dishonest unless the accused was under an obligation to disclose the facts

concealed. There was no such obligation to disclose the alleged

circumstance/ fact while executing the agreement and appointing the

complainant as 'attorney' for clearance of the FDRs in question.

20. The Trial Court without application of mind issued process

under Section 417 IPC. The summoning order dated 26.04.1999 cannot be

sustained and is set aside. The complaint case and the proceedings arising

out of it are quashed. The petition is allowed. Pending application stands

disposed of. Trial Court record (if any) be sent back forthwith.

(S.P.GARG) JUDGE MAY 30, 2013 tr