Telangana High Court
Jagadish Agarwal And Another vs The State Of Telangana on 19 October, 2022
Bench: K.Surender
THE HON'BLE SRI JUSTICE K.SURENDER
CRIMINAL PETITION No. 8624 OF 2019
O R D E R:
This Criminal Petition under Section 482 of the Code of Criminal
Procedure, 1973 (for short 'Cr.P.C.'), is filed seeking to quash the charge
sheet filed in CC.No.1521 of 2019 in Crime No.406 of 2019
dt.05.06.2019, pending on the file of the VI Metropolitan Magistrate at
Medchal, Cyberabad. The petitioners herein are accused in the said
crime. The offences alleged against them are under Sections 406, 420,
506 read with 34 of the Indian Penal Code.
2. Heard Sri Pratap Narayan Sanghi, learned Senior Counsel
appearing for the petitioners, learned Assistant Public Prosecutor
appearing for the State and defacto complainant/2nd respondent and
perused the record.
3. The case of the 2nd respondent/defacto complainant is that he was
running a business dealing with welding and safety materials at
Ranigunj, Secunderabad and sustained losses in the year 2017. He has
taken permission from the petitioners for storing material in the factory
premises of the petitioners/accused, located at IDA Jeedimetla, for safe
custody. However, when the 2nd respondent and his son visited the
premises they found that the material worth Rs.43,62,455/- which was
kept in the factory premises of the petitioners missing. When
questioned, the defacto complainant was threatened. In the said
circumstances, the petitioners have committed the offences of cheating,
misappropriation and criminal intimidation.
4. The learned Senior Counsel Sri Pratap Narayan Sanghi argued
that the defacto complainant/2nd respondent suffered financial losses
and to overcome the said situation filed an insolvency petition which is
pending adjudication. The said petition was filed seeking to declare the
2nd respondent insolvent to an extent of Rs.46,74,035/-.
5. He further argued that the petitioners have given a hand loan of
Rs.18 lakhs and the 2nd respondent handed over the articles to the
petitioners who in turn sold to third parties and recovered an amount of
Rs.12 lakhs out of the said 18 lakhs which was due. He further submits
that to attract an offence under Section 420 of Indian Penal Code there
has to be element of inducement pursuant to misrepresentation and
such inducement should have resulted in delivery of property. Since all
the ingredients of Section 420 of the IPC are missing, the prosecution
cannot be proceeded with. Since the question of entrustment as
required under Section 406 of the IPC is not proved by the complainant,
the question of committing an offence under Section 406 of the IPC is
not made out and any transactions in between the petitioners and
defacto complainant are business transactions which are purely civil in
nature. In the said background, the petitioners cannot be
prosecuted for criminal offences and sought interference of this Court in
quashing the proceedings.
6. He also relied upon the Judgments of Honourable Supreme Court
in Wyeth Limited and others v. State of Bihar and another1 in
Criminal Appeal No.1224 of 2022 (Special Leave Petition (Crl.) No.10730
of 2018), wherein the Honourable Supreme Court held that when the
transactions discloses a commercial relationship, merely adding the
language to make out the ingredients of criminal offences, is incorrect
and consequently the Honourable Supreme Court quashed the FIR.
7. The other Judgment relied upon by the petitioners in Vijay
Kumar Ghai and others v. State of West Bengal and others2 was
also a case wherein the Honourable Supreme Court was pleased to
quash the proceedings, finding on facts that the transactions would not
sustain criminal prosecution.
8. He also relied upon the Judgment of Honourable Supreme Court
in Ashok Chaturvedi and others v. Shitul H.Chanchani and
another 3 wherein the Honourable Supreme Court found fault with
taking cognizance of the charge sheet when none of the ingredients were
made out.
9. Finally, the learned Senior Counsel also relied upon the
Judgment of Honourable Supreme Court in Kartik Chandra Majee v.
2022 Live Law (SC) 721
(2022) 7 SCC 124
AIR 1998 Supreme Court 2796
State of Jharkahand 4 wherein since there were no specific
allegations, the Honourable Supreme Court quashed the proceedings.
10. On the basis of the said Judgments, the learned Senior Counsel
submits that they are squarely applicable to the facts of the present
case and the case against the petitioners has to be quashed.
11. As evident from the record, it is an admitted fact that there are
transactions in between the petitioners and the defacto complainant. In
course of commercial transactions, any acts deliberately committed may
also amount to criminal offences. In the present case, admittedly, the
goods were entrusted to the petitioners herein. However, it is the case of
the petitioners that the goods were given towards an outstanding and
the petitioners have sold the goods as they were given to repay the
outstanding amount.
12. The 2nd respondent has specifically stated that the goods were
entrusted to the petitioners to be taken back subsequently. It is further
stated that the said goods were kept in the premises of the factory of the
petitioners to safeguard the material for the reason of the 2nd
respondent being indebted to several others during business
transactions and that they may take it away.
13. To attract an offence under Section 420 of the Indian Penal Code,
it has to be proved that there was a false statement pursuant to which a
AIR 2017 Supreme Court 3096
person is induced. Pursuant to such inducement there should be
delivery of property. In the present facts of the case, there are no such
ingredients which are fulfilled to make out a case for cheating under
Section 420 of the Indian Penal Code. Consequently, the charge under
Section 420 of IPC is hereby quashed.
14. However, since the goods being entrusted to the petitioners is
admitted, whether the said goods were given towards the outstanding or
whether the petitioners have misappropriated the said amounts, have to
be decided by the trial Court during the course of trial. This Court in
quash proceedings cannot decide rival claims.
15. Accordingly, the Criminal Petition is partly allowed quashing the
criminal proceedings under Section 420 of the IPC. The trial Court is
directed to proceed with the case under Section 406 and 506 read with
34 of the Indian Penal Code and shall decide the case on the basis of
the evidence adduced, without being influenced by any of the
observations or findings made in this order.
Miscellaneous applications pending, if any, in this criminal
petition, shall stand closed.
________________
K.SURENDER, J
19.10.2022
tk
THE HON'BLE SRI JUSTICE K.SURENDER
CRIMINAL PETITION NO. 8624 OF 2019
Dt. 19.10.2022
tk
