Telangana High Court
Shwasa Constructions vs State Of Telangana on 10 January, 2023
Bench: K.Surender
HON'BLE SRI JUSTICE K.SURENDER
CRIMINAL PETITION No.6717 OF 2022
ORDER:
1. This Criminal Petition is filed seeking to quash the
complaint in STC-NI No.919 of 2022 on the file of IX
Metropolitan Magistrate, Manoranjan Complex, Hyderabad.
2. The petitioners are questioning the continuance of their
criminal prosecution for the offence under Section 138 of the
Negotiable Instruments Act filed by the 2nd respondent mainly
on the ground that the cheques in question were given
towards sale consideration of the property. In the event of
failure to pay the sale consideration, it would not amount to
legally enforceable debt and since the cheques which are given
after entering into an agreement of sale and when registration
of the property not taken place, the question of there being
any liability or debt on the said cheques given towards sale
consideration does not arise.
3. Sri Sricharan Telaprolu, learned counsel for the
petitioners has relied on the clauses 12 and 13 of the two
agreement of sales dated 24.07.2021, which reads as follows:
"12. If the Vendor fails to execute and register the said sale deed
within the specified time referred to above even after the receipt of
consideration the Vendor shall be liable for specific performance of
this agreement and shall be liable to pay costs and damages to the
PURCHASER/s. shall be liable to pay double cost of advance amount
to the PURCHASER/s.
13. If the PURCHASER/s fails to obtain the sale deed within the time
specified above, by paying the balance of the consideration he shall
have no claim whatsoever under this agreement, his/her earnest
amount will be forfeited and this agreement will be treated as null and
void."
4. Learned counsel for the petitioners argued that according
to the agreement in between the parties, if the purchaser fails
to obtain the sale deed within time specified by paying balance
consideration, no claim whatsoever can be made regarding the
earnest amount and same would be forfeited. Since the
amount which was earlier paid to an extent of Rs.9.00 lakhs
was already forfeited, the 2nd respondent/complainant is
benefitted by that amount. When there is no question of
purchasing the property and consequent registration of the
property, the question of paying the amount covered by the
cheques does not arise, as such there is no legally enforceable
debt.
5. On the other hand, Sri A.P.Suresh, learned counsel for
the 2nd respondent would submit that the similar issue was
decided by the Hon'ble Supreme Court in the case of
Ripudaman Singh v. Balkrishna (Criminal Appeal NO.483 of
2019, dated 13.03.2019 arising out of SLP (Crl.) No.4608 of
2016, wherein it is held as follows:
"13.we find ourselves unable to accept the finding of the learned Single
Judge of the High Court that the cheques were not issued for creating
any liability or debt, but 'only' for the payment of balance consideration
and that in consequence, there was no legally enforceable debt or other
liability. Admittedly, the cheques were issued under and in pursuance
of the agreement to sell. Though it is well settled that an agreement to
sell does not create any interest in immoveable property, it nonetheless
constitutes a legally encforceable contract between the parties to it. A
payment which is made in pursuance of such an agreement is hence a
payment made in pursuance of a duly enforceable debt or liablity for the
purposes of Section 138.
15. The question as to whether there was a dispute as contemplated in
clause 4 of the Agreement to Sell which obviated the obligation of the
purchaser to honor the cheque which was furnished in pursuance of
the agreement to sell to the vendor, cannot be the subject matter of a
proceeding under Section 482 and is a matter to be determined on the
basis of the evidence which may be adduced at the trial."
6. The Hon'ble Supreme Court in the said judgment held
that though an agreement of sale does not create any interest
in immovable property, however, it constitutes a legally
enforceable contract in between the parties and any cheques
given towards such agreement of sale would constitute an
enforceable debt. Further, the clauses mentioned in the
agreement of sale could only be determined during the course
of trial and not under Section 482 of Cr.P.C by the High Court.
7. In view of law laid down by the Hon'ble Supreme Court in
the aforesaid case, the ground of there being no liability on the
cheques issued towards sale consideration on the basis of the
agreement reduced into writing under clauses 12 and 13 can
only be determined by the trial Court. It is left open to the
petitioners to address their defence before the trial Court. The
trial Court shall consider the defence of there being no liability
on the cheques issued towards sale consideration. The Hon'ble
Supreme Court held that such defence cannot be considered
in a quash proceedings but only during trial.
8. In the result, the Criminal Petition is accordingly diposed
with the above observations. As a sequel thereto,
miscellaneous petitions, if any, shall stand closed.
__________________
K.SURENDER, J
Date:10.01.2023
kvs
HON'BLE SRI JUSTICE K.SURENDER
CRIMINAL PETITOIN No.6717 OF 2021
Date:10.01.2023.
kvs
