K. Neelakantan vs T.K. Adimoolam

Sengottuvelan, J.—This is an application u/s 482 of the Cr. P.C. for quashing the prosecution in C. C. No. 49 of 1985 on the file of the

Chief Judicial Magistrate, Chingleput. The facts of the case are briefly as follows:

The petitioner-accused in the case before the lower court is the proprietor of one Neilgan Agencies manufacturing grinders in the trade name

Janee Grinder. According to the complainant, the accused after receipt of a sum of Rs. 25,000/- from the complainant on behalf of his son''s firm

Ravi and Co., delivered eight grinders to Ravi & Co., on 24th Mar. 1982 and 11th June 1982 through his clerk and agent Rajendran. The said

grinders were not sold and the complainant respondent pressed for the return of the money advanced, since the business was wound up. Seven

days prior to 24th Mar. 1983 the petitioner met the respondent at Chingleput District Court canteen and represented to him that he will take back

the available six grinders and pay a sum of Rs. 11,000/- ten days later after delivery. The respondent bona fide believed the representation and

delivered the grinders to the clerk of the petitioner, Rajendran. The respondent had been asking for the return of the amount and after eight months

the petitioner herein gave a crossed cheque for Rs. 5,000/- on 28th May 1984 as part payment of the amount payable promising to pay the

balance later. The respondent presented the crossed cheque for Rs. 5,000/- for encashment at Bank of Baroda on 25th May 1984 and the same

was dishonoured for want of funds in the account.

It is specifically alleged in the complaint made by the respondent in the above criminal case, that the petitioner made false representation with the

dishonest intention of not paying the value and with avowed object of defrauding the complainant, induced the complainant to deliver six grinders

as stated above. It is also stated that the respondent would not have parted with six grinders, but for the false and fraudulent representations of the

petitioner that he would make the payment of the abovesaid amount. It is also stated that the respondent lodged a complaint before the police and

the same was referred as one of civil nature and on service of the notice of referred charge sheet the respondent herein preferred a private

complaint in CC. No. 49/1985 which is pending before the Chief Judicial Magistrate, Chingleput. The present petition is to call for the records and

quash the proceedings against the accused-petitioner.

Mr. Prakash Goklaney, advocate for the petitioner raises the following contentions in support of his argument that the prosecution proceedings

in CC. No. 49/1985 will have to be quashed (1) The facts stated in the complaint only give rise to a civil claim and the criminal complaint u/s 420,

l.P.C. regarding the same is not sustainable. (2) In any event, the allegations in the complaint do not make out an offence u/s 420, I.P.C. and hence

the prosecution will have to be quashed.

The complaint before the lower court is one u/s 420, I.P.C., Section 420, I.P.C. reads as follows :

Cheating and dishonestly inducing delivery of property :

Whoever cheats and thereby dishonestly induces the person deceived to deliver any property to any person, or to make, alter or destroy the whole

or any part of a valuable security, or anything which is signed or sealed, and which is capable of being converted into a valuable security, shall be

punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine.

The ingredient of the offence consists in dishonestly inducing a person to deliver property. In this case, the respondent in the complaint alleged that

he had been induced by the petitioner to deliver the grinders in question on the false representation that the value of them will be paid and the

respondent believing his representation delivered the grinders.

Mr. Prakash Goklaney, contends that the respondent will be entitled to only the value of the grinders and it is only a civil claim and Section 420,

I.P.C. is not attracted in so far as the facts of this case are concerned. In support of his contention, he relied on the following decisions : In the case

reported in Chidambaram Chettiar v. Seanmughan Pillai AIR 1938 Mad 129 : 1938 Cri LJ 261, a single Judge of this Court has held that in a case

where a cheque issued for payment of amount due to a petrol dealer by a customer was dishonoured, the same will not amount to an offence u/s

420, I.P.C. The learned Judge has observed as follows:

A post-dated cheque in payment of goods already received is a mere promise to pay on a future date and a broken promise is not a criminal

offence, though it may amount in certain business relations discreditable behaviour.

In the case reported in R.S. Ratra v. Ganesh Dass (1940) Cri LJ 394: AIR 1940 Lah 93, a single Judge of Lahore High Court held that giving a

post-dated cheque by a person who has no funds to his credit in the Bank does not amount to an offence of cheating when there is no evidence to

show that the person to whom the cheque was given parted with any property or that he did or omitted to do anything which he would not have

done or omitted to do if he had known that the cheque would be dishonoured. The dispute in such a case is of a civil nature. In the case reported

in State of Kerala Vs. A. Pareed Pillai and Another, the Supreme Court has observed as follows:

To hold a person guilty of the offence of cheating, it has to be shown that his intention was dishonest at the time of making the promise, Such a

dishonest intention cannot be inferred from the mere fact that he could not subsequently fulfil the promise.

In the case reported in Gopu Seshasayee v. State 1977 T. L. N. J. 510 where in order to avoid an order of attachment of movables, a cheque

was issued for twice the amount due and the same was dishonoured Suryamurthy, J. observed as follows. :

The mere issue of cheques for amounts already due will not amount to cheating merely because the cheques were dishonoured. At the time of

issuing of cheques, the petitioner might have intended to make arrangements for their being honoured when presented in the Bank. Subsequently,

he might have failed to make such arrangement on account of some supervening difficulty or might even have dishonestly refrained from doing so.

That subsequently he dishonestly refrained from making arrangement for the cheques being honoured is not sufficient to show that on the dates of

the issue of the cheques, he was motivated by a dishonest intention. Therefore, no offence punishable u/s 420, I.P.C., or any other section of the

Penal Code can be deemed to have been committed by the petitioner.

All the above four cases relate to preexisting debt for which a cheque was issued which was subsequently dishonoured. In none of the above

cases, any inducement by which property was delivered is alleged. But, in this case, in the complaint, it is specifically stated that the respondent

was induced to deliver grinders on the promise of payment of the value of the said grinders and that the respondent acting on the inducement,

actually delivered the grinders. Hence, such inducement resulting in delivery of the grinders if proved to be true will fall within the purview of

Section 420, I.P.C.

Learned Counsel for the respondent Mr. P. Rajamanickam relied on a judgment of Delhi High Court in Bhola Nath Arora and Another Vs. The

State, where it is observed as follows:

Where an accused had paid certain amounts by means of demand draft for the goods suplied by the dealer and for the balance amount certain

cheques delivered by him to dealer were dishonoured on different dates and the bank account showed that at no date any attempt was made by

the accused to pay in sufficient amount for encashment of the cheques, such matter would be sufficient to afford a ground for presuming that the

accused had committed an offence u/s 420.

In the case reported in Nagu Thevar v. Periakaruppa Thevan 1952 MWN (Cri) 17 : 1953 Cri LJ 433 it has been observed that where deceit or

cheating by representation is alleged by the complaint it is not a case for dismissal u/s 203 as a civil matter and witnesses regarding the alleged

cheating ought to be heard. In the case reported in Desraj Khanna v. State 1955 MWN(Cri) 261, Somasundaram, J. held as follows :

When the cheque was given, there was necessary money in the account of the appellant when in fact he did not have any amount.

Relying on the above decisions, it is contended that issuing of a cheque itself will amount to implied representation and Section 420, I.P.C., is

attracted when the cheque is dishonoured.

In considering this petition u/s 482, Cr. P.C., we have only to see whether, according to the allegations in the complaint, an offence is made out.

If the allegation in the petition is that a cheque was issued and the same was dishonoured, then it can be stated that it is only a civil claim and

Section 420, I.P.C., is not attracted. But in this case, there is a specific allegation that the petitioner induced the respondent to deliver the grinders

on a particular promise and if such an inducement with dishonest intention and delivery is proved, it will constitute an offence u/s 420, I.P.C. All the

four cases cited on behalf of the petitioner will not apply to the facts of the case, since in those cases, there is no inducement or delivery of the

goods in pursuance of the inducement.

Under the circumstances, there are no merits in this petition and the same is dismissed.

The observations made in this order relate only to the question of law and each case will have to be decided on the evidence let in. The

observations made herein will not in any way prejudice the case of the petitioner.