Mr. Ankit Kumar Singh vs The State Of Madhya Pradesh
2023 Latest Caselaw 5466 MP

                                                             1
                            IN    THE       HIGH COURT OF MADHYA PRADESH
                                                  AT INDORE
                                                      BEFORE
                                          HON'BLE SHRI JUSTICE ANIL VERMA
                                                 ON THE 3 rd OF APRIL, 2023
                                         MISC. CRIMINAL CASE No. 45457 of 2021

                           BETWEEN:-
                           1.    MR. ANKIT KUMAR SINGH S/O PANKAJ KUMAR
                                 SINGH, AGED 37 YEARS, OCCUPATION: BUSINESS
                                 HAVING ADDRESS AT A-22, NATRAJ BANKER
                                 SOCIETY,   KHERALU      ROAD,   VISNAGAR,
                                 MEHSANA, GUJRAT

                           2.    MR. KRUNAL PATEL S/O MAHENDRABHAI PATEL,
                                 AGED     35 YEARS, OCCUPATION: BUSINESS
                                 HAVING ADDRESS AT BUNGALOW NO. 9,
                                 SUNVILLA, NEAR STERLING CANCER HOSPITAL
                                 VADODARA (GUJARAT)

                                                                                        .....PETITIONERS
                           (BY SHRI AASHUTOSH SRIVASTAVA - ADVOCATE)

                           AND
                           1.    THE STATE OF MADHYA PRADESH THROUGH
                                 THE SR. INSPECTOR OF POLICE CIVIL LINE
                                 POLICE STATION, DEWAS MADHYA PRADESH-
                                 455001

                           2.    MR. YOGESH SHARMA S/O P.R. SHARMA, AGED 42
                                 YEARS, R/O 2, COUNTY PARK, THANA LASUDIA
                                 INDORE (MADHYA PRADESH)

                                                                                      .....RESPONDENTS
                           ( SHRI HEMANT SHARMA - GOVERNMENT ADVOCATE FOR
                           RESPONDENT NO.1)
                           (SHRI PARICHAY TRIVEDI - ADVOCATE FOR RESPONDENT NO.2.)


                                 This M.Cr.C. coming on for admission this day, the court passed the
                           following:
                                                              ORDER

The petitioners have preferred this petition under Section 482 of Code of Signature Not Verified Signed by: BHUNESHWAR DATT Signing time: 05-04-2023 17:13:06

Criminal Procedure, 1973 (in short Cr.P.C.ÂÂ) for quashment of FIR dated 6.8.2021 arising out of Crime No. 438/2021 registered at Police Station Civil Lines Dewas District Dewas for offence under Section 406 of the Indian Penal Code, 1860 (in short IPC).

The facts in brief are that in the month of September 2014 the complainant company procured the project of limestone mining in J.K. Cement Mudhol, Karnataka. A work order of Rs. 150 crores was granted to the complainant company by J.K. Cement. Some work from this order was granted to PKS Technobuild Pvt Ltd., a Gujarat based company. The complainant provided 12 Man Tipper; 3 Drill Machines; compressor: 1 cabin Drill Semi

Excavator; 3 Tata Hitachi 370 Excavator; 2 Semi 210 Excavator, New Old Spare Parts, 4 Bolero Cars having Karnataka Passing and the same were made available at Moudhol Karnataka site to Mr. Ankit Singh and Krunal Singh, the directors of the company, PKS Technobuild Pvt Ltd Co. In the year 2018 the complainant company received another work from the Coal India Company in Ranchi and accordingly, the complainant company had assigned the above mentioned work to PKS Technobuild Pvt Ltd. With the consent of the informant, all the above mentioned resources were transferred from Karnataka site to Ranchi Site by the director of PKS Technobuild Pvt Ltd. The complainant had discussed about the rent for utilizing the above mentioned resources. When the complainant enquired about the same to the directors of the PKS Technobuild Pvt Ltd. the directors allegedly ignored the complainant and neither the said vehicles nor the rent amount of those vehicles were paid by them. These vehicles worth of Rs. 1.15 crore was not given to the complainant and allegedly new cabin drill and compressor were replaced by old drill.Some

Signature Not Verified Signed by: BHUNESHWAR DATT Signing time: 05-04-2023 17:13:06

valuable spare parts were removed from the machines. The Director Mr. Ankit Singh and Mr.Krunal Patel committed criminal breach of trust. Therefore, the complainant/respondent no. 2 lodged the FIR at police Station Civil Lines Dewas.

Learned counsel for the petitioners contended that even if the contents of FIR are taken at face value, they do not contain allegations of any cognizable offences. The time span for mining on the said sites was allotted for the period of 4 years as per the principal contract. The aforesaid equipment and machinery were transferred in the name of petitioners i.e. P.K. & Sons. Accordingly two contracts dated 8.9.2014 were signed by and between Laxyo Energy Ltd. the sister concern company of the complainant company and the firm P.K. & Sons in which petitioners are directors. As per agreed terms, margin deposit of Rs. 35 lakhs for these equipment and machineries was deposited by the petitioner in the Laxyo Energy Ltd.. The complainant company deliberately started avoiding the legal and valid demand of applicant company. The complainant by applying undue influence and misleading the local police, falsely registered the complaint. The registration of the present FIR is a complete abuse of process of law and blatant abuse of power by the police authorities. The agreement was executed in Karnataka, and as per arbitration clause of the aforesaid contract, the jurisdiction of the matter only lies to Karnataka jurisdiction and Civil Line

Dewas police station has no jurisdiction to register the aforesaid FIR. The dispute between the applicant and complainant is purely of civil nature. In support of his contention learned counsel placed reliance upon judgment dated 4.10.2016 passed by Hon'ble Apex court in the matter of A.Ayyasamy Vs. A.Paramasivam and others passed in Civil appeal No. 8245-8246 of 2016 and judgment dated 22.3.2022 passed in Criminal appeal No. 463 of 2022 in Signature Not Verified Signed by: BHUNESHWAR DATT Signing time: 05-04-2023 17:13:06

the matter of Vijay Kumar Ghai and others Vs. The State of West Bengal and others. Hence it is prayed that the FIR registered by police station Civil Lines Dewas at crime No. 438/2021 under section 406 of IPC be quashed.

Learned counsel for respondent no.1/State opposes the M.Cr.C. and prays for its rejection.

Learned counsel for respondent no. 2 also opposes the M.Cr.C. and prays for its rejection by submitting in the return/reply that petitioner being in an entrusted position took an inappropriate, unjustified advantage and deliberately committed an offence of misappropriation of property as well as has committed offences under breach of trust as he has illegally detained respondent no. 2 valuable machinery and vehicles done misappropriation of funds, failed in giving the rent for the use of machinery. Such acts on the part of petitioners absolutely justifies the FIR lodged against them. Hence he prays for dismissal of M.Cr.C. In support of his contention learned counsel placed reliance upon judgment of Hon'ble Apex court in the matter of Trisuns Chemical Industry Vs. Rajesh Agarwal reported in (1999) 8 SCC 686 and judgment dated 27.7.2003 passed in Appeal (Crl.) 1180 of 2003 in the matter of State of Andhra Pradesh Vs. Golconda Linga Swamy and others, in the matter of Rajesh Bajaj Vs. State NCT of Delhi reported in (1999) 3 SCC 259.

I have heard learned counsel for the parties and perused the record. In order to make out a prima facie case for prosecuting a person, the complainant must show that accused has committed criminal breach of trust with malafide intention. Section 405 of IPC defines Criminal Breach of Trust which reads as under:-

Signature Not Verified Signed by: BHUNESHWAR DATT Signing time: 05-04-2023 17:13:06

405. Criminal breach of trust. ÂÂ"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 willfully suffers any other person so to do, commits œcriminal 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.

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.

Signature Not Verified Signed by: BHUNESHWAR DATT Signing time: 05-04-2023 17:13:06

Though it is a fact that Section 482 of Cr.P.C. has wide power to High court, however, it should not be applied in random but to use sparingly. Section 482 of Cr.P.C. has been incorporated to prevent process of law and not to encourage of offences. In the present case it is to be pertained that the said agreement was executed between PKS Technobuild Pvt Ltd and Laxyo Energy with M/s Yolax Infranergy Pvt Ltd. (respondent no.2 is the director in said company). As per agreement petitioners were entrusted with the aforesaid machinery and vehicles, the burden lies upon the petitioners to prove that they have paid the entire amount to the complainant, but it is a matter of evidence and same fact cannot be decided at this stage in this M.Cr.C without leading evidence.

Hon'ble Apex court in the case of Kaptan Singh Vs. State of Uttar Pradesh and others reported in(2021) 9SCC 35 in paragraph No. 10 has held that:-

The High Court has failed to appreciate and consider the fact that there are very serious triable issues/allegations which are required to be gone into and considered at the time of trial. The High Court has lost sight of crucial aspects which have emerged during the course of the investigation. The High Court has failed to appreciate and consider the fact that the document i.e. A joint notarized affidavit of Mamta Gupta â€ÂÂ" Accused No.2 and Munni Devi under which according to Accused no.2 - Ms. Mamta Gupta, Rs.25 lakhs was paid and the possession was transferred to her itself is seriously disputed. It is required to be noted that in the registered agreement to sell dated 27.10.2010, the sale consideration is stated to be Rs.25 lakhs and with no reference to payment of Signature Not Verified Signed by: BHUNESHWAR DATT Signing time: 05-04-2023 17:13:06

Rs.25 lakhs to Ms. Munni Devi and no reference to handing over the possession. However, in the joint notarized affidavit of the same date i.e., 27.10.2010 sale consideration is stated to be Rs.35 lakhs out of which Rs.25 lakhs is alleged to have been paid and there is a reference to transfer of possession to Accused No.2. Whether Rs.25 lakhs has been paid or not the accused have to establish during the trial, because the accused are relying upon the said document and payment of Rs.25 lakhs as mentioned in the joint notarized affidavit dated 27.10.2010. It is also required to be considered that the first agreement to sell in which Rs.25 lakhs is stated to be sale consideration and there is reference to the payment of Rs.10 lakhs by cheques. It is a registered document. The aforesaid are all triable issues/allegations which are required to be considered at the time of trial. The High Court has failed to notice and/or consider the material collected during the investigation.

Hon'ble the apex Court again in the case of Munshiram Vs. State of Rajasthan and Another passed in Criminal Appeal No.515-516 of 2018 on 09/04/2018 in paragraph No.13 has held as under:-

€œIn light of the fact that the enquiry was pending and there are aspects which may require investigation, we are of the considered opinion that the High Court erred in quashing the FIR at the threshold itself without allowing the investigation to proceed. We cannot agree with the reasons provided under the impugned judgment concerning certain factual assertions made by the Respondents as to the condition of the deceased and reasons for committing suicide because acceptance of the said would not be in consonance with the settled jurisprudence under Section 482 of CrPC as laid down by various judgments of this Court.

Signature Not Verified Signed by: BHUNESHWAR DATT Signing time: 05-04-2023 17:13:06

The apex Court in the case of CBI Vs. Arvind Khanna reported in (2019) 10 SCC 686 in paragraph No.17 has held as under:-

17. After perusing the impugned order and on hearing the submissions made by the learned senior counsels on both sides, we are of the view that the impugned order passed by the High Court is not sustainable. In a petition filed under Section 482 Cr.P.C., the High Court has recorded findings on several disputed facts and allowed the petition. Defence of the accused is to be tested after appreciating the evidence during trial. The very fact that the High Court, in this case, went into the most minute details, on the allegations made by the appellant-C.B.I., and the defence put-forth by the respondent, led us to a conclusion that the High Court has exceeded its power, while exercising its inherent jurisdiction under Section 482 Cr.P.C.

18. In our view, the assessment made by the High Court at this stage, when the matter has been taken cognizance by the Competent Court, is completely incorrect and uncalled for.

From perusal of the GST registration certificate of respondent no. 2 it appears that his registered address is 108 Jai Bajarang Nagar Dewas, Madhya Pradesh. Therefore, the cause of action also arises at Dewas.

It is also alleged by respondent no. 2 that petitioners have denied to return back the property of respondent no. 2 in the meeting held at Dewas on 25.7.2021, therefore, the cause of action also arise at Dewas.

The Hon'ble Apex court in case of Rajesh Agarwal (supra) has held as under:-

14. The jurisdictional aspect becomes relevant only Signature Not Verified when the question of enquiry or trial arises. It is Signed by: BHUNESHWAR DATT Signing time: 05-04-2023 17:13:06

therefore, a fallacious thinking that only a Magistrate having jurisdiction to try the case has the power to take cognizance of the offence. If he is a Magistrate of the First Class his power to take cognizance of the offence is not impaired by territorial jurisdiction. After taking cognizance he may have to decide as to the court which has jurisdiction to enquire into or try the offence and that situation would reach only during the post- cognizance and not earlier.

Learned counsel for petitioners has placed reliance upon the judgment in the case of Vijay Kumar Ghai (supra) in which it has been held as under:-

42. The order of the High Court is seriously flawed due to the fact that in its interim order dated 24.03.2017, it was observed that the contentions put forth by the Appellant vis a vis two complaints being filed on the same cause of action at different places but the impugned order overlooks the said aspect and there was no finding on that issue. At the same time, in order to attract the ingredients of Section of 406 and 420 IPC it is imperative on the part of the complainant to prima facie establish that there was an intention on part of the petitioner and/or others to cheat and/or to defraud the complainant right from the inception. Furthermore it has to be prima facie established that due to such alleged act of cheating the complainant (Respondent No. 2 herein) had suffered a wrongful loss and the same had resulted in wrongful gain for the accused(appellant herein). In absence of these elements, no proceeding is permissible in the eyes of law with regard to the commission of the offence punishable u/s 420 IPC. It is apparent that the complaint was lodged at a very belated stage (as the entire transaction took place from January 2008 to August 2009, yet the complaint has been filed in March 2013 i.e., after a delay of almost 4 years) with the objective of causing harassment to the petitioner and is bereft of any truth whatsoever.

Signature Not Verified Signed by: BHUNESHWAR DATT Signing time: 05-04-2023 17:13:06

But the Hon'ble Apex court in the case of Rajesh Bajaj (supra) has held that if averments in complaint prima facie make out a case for investigation the High court cannot quash the complaint merely because one or two ingredients of the offence have not been stated in detail.

In the case of Ramveer Upadhyay and Anr. Vs. State of U.P. & Anr. passed in Special Leave Petition (Crl.) No.2953 of 2022, Hon'ble the apex Court has held as under:-

....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. ....

Thus, it is clear that although this Court cannot make roving inquiry at this stage, but if the uncontroverted allegations do not make any offence, only then this Court can quash the FIR. The allegations made against the petitioners established prima facie case punishable under Section 406 of the IPC. Therefore, the claim of the petitioners that there is no evidence available against them, cannot be accepted at this stage.

In view of the prima facie evidence available on record against the petitioners, without considering the facts on merit the citations relied by the petitioners cannot be made applicable at this stage. This Court cannot analyze the entire evidence and came to the conclusion that whether a conviction is possible or not. Therefore, I am of considered view that it is not a fit case where this Court can exercise the power conferred under Section 482 of Cr.P.C.

Signature Not Verified Signed by: BHUNESHWAR DATT Signing time: 05-04-2023 17:13:06

It is also settled law that facts may give rise to a civil claim and also amount to an offence. Merely because a civil claim is maintainable does not mean that the criminal complaint cannot be maintained.

Accordingly, petition preferred under Section 482 of Cr.P.C. dismissed. It is made clear that this Court has not expressed any opinion on the merits of the case. The trial Court shall continue the trial against the petitioners without being influenced or prejudice by the observation made in the instant order.

Certified copy as per rules.

(ANIL VERMA) JUDGE BDJ

Signature Not Verified Signed by: BHUNESHWAR DATT Signing time: 05-04-2023 17:13:06