Arun Kumar vs State of Haryana and Another

Sabina, J.—Petitioner has filed this petition u/s 482 of the Code of Criminal Procedure, 1973 for quashing of complaint No. 583-1 of 2007 (Annexure P-2) instituted on 21.2.2007/7.12.2009, titled "Sham Sunder versus Luxmi Niwas and others" and all the consequential proceedings arising therefrom including the summoning order dated 4.3.2011 (Annexure P-1). Learned counsel for the petitioner has submitted that the allegations levelled by the complainant on the face of it did not make out a case for summoning of the accused. There was no occasion for the complainant to pay Rs. 10,00,000/- to the accused. In fact, as per the award of the Arbitrator, arbitrators were to clear the liabilities from the balance amount left after paying half value of the house to Luxmi Niwas, Arun Kumar and Shashi Devi. House No. B-6/140 was to be sold by the Arbitrator.

As per the award, there was no stipulation that complainant was to pay any amount to the accused for clearance of dues. Complainant had already filed a suit for recovery of the amount in question against the arbitrators.

Learned counsel for respondent No. 2, on the other hand, has opposed the petition and has submitted that the amount in question had been received by the petitioner and his co-accused and instead of disbursing the same to the creditors, it had been misappropriated by the petitioner and his co-accused.

In the case of State of Haryana and others Vs. Ch. Bhajan Lal and others, the Apex Court has held as under:-

The following categories of cases can be stated by way of illustration wherein the extraordinary power under Article 226 or the inherent powers u/s 482, Cr. P.C. Can be exercised by the High Court either to prevent abuse of the process of any court or otherwise to secure the ends of justice, though it may not be possible to lay down any precise, clearly defined and sufficiently chennelised and inflexible guidelines or rigid formulae and to give an exhaustive list of myriad kinds of cases wherein such power should be exercised:-

(1) Where the allegations made in the first information report or the complainant/respondent No. 2, even if they are taken at their face value and accepted in their entirety do not prima facie constitute any offence or make out a case against the accused.

(2) Where the allegations in the first information report and other materials, if any, accompanying the FIR do not disclose a cognizable offence, justifying an investigation by police officers u/s 156(1) of the Code except under an order of a Magistrate within the purview of Section 155(2) of the Code.

(3) Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same do no disclose the commission of any offence and make out a case against the accused.

(4) Where, the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted by a Police Officer without an order of Magistrate as contemplated u/s 155(2) of the Code.

(5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever reach a just conclusion that there is sufficient ground for proceeding against the accused.

(6) Where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is instituted) to the institution and continuance of the proceedings and/or where there is specific provision in the Code or the concerned Act, providing efficacious redress for the grievance of aggrieved party.

(7) Where a criminal proceeding is manifestly attended with mala fide and/or where the proceedings is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge.

We also give a note of caution to the effect that the power of quashing a criminal proceeding should be exercised very sparingly and with circumspection and that too in the rarest of rare cases; that the court will not be justified in embarking upon an enquiry as to the reliability or genuineness or otherwise of the allegations made in the FIR or the complaint and that the extraordinary or inherent powers do not confer an arbitrary jurisdiction on the court to act according to its whim or caprice.

The case of the complainant as per the complaint (Annexure P-6), in brief, is that parties had approached arbitrators on 4.8.2003 on account of dispute relating to joint Hindu family property and income arising therefrom. The Arbitrators gave the award on 21.2.2004. The said award was duly signed by the parties. The amount paid by the complainant to the accused for payment to the creditors was misappropriated by the accused. Hence, the complaint was filed.

Complainant led his preliminary evidence in support of his case.

The Trial Court vide order dated 4.3.2011 (Annexure P-1) ordered the summoning of the petitioner and his co-accused qua commission of offence punishable u/s 420 of the Indian Penal Code (''IPC for short).

Annexure P-3 is the award passed by the Arbitrator. A perusal of the same reveals that house No. B-6/140 situated in Gali Seth Nand Lal Wali was to be sold. 1/4th of the sale proceeds were to be paid to Luxmi Niwas and his wife Shashi Devi and 1/4th of the sale proceeds were to be paid to Arun Kumar. The remaining sale consideration was to be paid to the creditors. In case any amount was still left, then the same was to be paid to complainant Sham Sunder. Arbitrators themselves were to clear all the above mentioned liabilities. Admittedly, as per the award, there was no condition that the amount in question was to be paid by the complainant to the accused for clearance of the dues to the creditors. In these circumstances, no criminal offence can be said to have been committed by the petitioner and his co-accused. A perusal of Annexure P-12 reveals that complainant Sham Sunder has filed a suit for recovery against the arbitrators.

As per Section 420 IPC, to constitute an offence of cheating, a person has to fraudulently or dishonestly induce a person to deliver any property to any person. However, in the present case, there was no occasion for the complainant to have handed over Rs. 10,00,000/-, as alleged by him, to the petitioner or his co-accused. Admittedly, as per the award, the arbitrators were to clear the liabilities with regard to creditors after sale of the house. Hence, continuation of criminal proceedings against the petitioner would be nothing but an abuse of process of law. Accordingly, this petition is allowed. Complaint No. 583-1 of 2007 (Annexure P-2) instituted on 21.2.2007/7.12.2009, titled "Sham Sunder versus Luxmi Niwas and others and all the consequential proceedings, arising therefrom, including the summoning order dated 4.3.2011 (Annexure P-1), are quashed.