K.Krishna and another vs State of Andhra Pradesh

K.Surender, J

This Criminal Revision Case is filed by accused Nos.1 and 2 aggrieved by the judgment dated 06.03.2013, in Crl.A.No.88 of 2012, on the file of the I Additional Metropolitan Sessions Judge, Hyderabad (for short ‘the Sessions Court’), whereunder the judgment dated 25.11.2011 in C.C.No.1381 of 2008, on the file of the III Additional Chief Metropolitan Magistrate, Hyderabad (for short ‘the Magistrate Court’), was set aside.

The revision petitioners/Accused Nos.1 and 2 are questioning the conviction by the Appellate Sessions Court under Section 421 of Cr.P.C, by setting aside the conviction of the Magistrate Court under Section 420 of IPC.

Briefly, the facts of the case are that a private complaint was filed by respondent No.2/de facto complainant for the offence under Sections 420 and 406 of IPC read with Section 34 of IPC before the Magistrate Court, which was referred to Sanjeeva Reddy Nagar Police Station, Hyderabad for investigation. The police referred the case as Civil in nature after investigation. Thereafter, the de facto complainant filed protest petition and the Magistrate Court took cognizance for the offence under Sections 406 and 420 of IPC read with Section 34 of IPC against the accused. The Magistrate Court, having examined PW1 to PW4 and marking Exs.P1 to P6, found that all the four accused were guilty of the offence under Section 420 of IPC.

Briefly, the case of the complainant is that on the request made by the accused for an amount of Rs.5,68,000/- to save accused house property from auction, which was mortgaged in the Charminar Cooperative Urban Bank Limited, the complainant has lent said amount to the accused. According to the complainant, the accused had taken loans from several people quoting the same reason and later he has filed insolvency petition No.85 of 2004 before the VI Senior Civil Judge, City Civil Court, Hyderabad. During the pendency of the said petition, the house was sold to a third person, which amounts to offence of cheating and misappropriation. Thus, the Magistrate Court has convicted all the accused Nos.1 to 4 for the offence under Section 420 of IPC and the same was questioned before the Sessions Court by filing an appeal.

Learned Sessions Judge found that no offence under Section 420 of IPC was made out against A1 to A4, however, found that accused Nos.1 and 2 sold the property to third party after taking loan from the de facto complainant/PW1, which act would fall under Section 421 of IPC. Sections 421 of IPC reads as under:

“421. Dishonest or fraudulent removal or concealment of property to prevent distribution among creditors.—

Whoever dishonestly or fraudulently removes, conceals or delivers to any person, or transfers or causes to be transferred to any person, without adequate consideration, any property, intending thereby to prevent, or knowing it to be likely that he will thereby prevent, the distribution of that property according to law among his creditors or the creditors of any other person, shall be punished with imprisonment of either description for a term which may extend to two years, or with fine, or with both.”

Learned counsel appearing for the revision petitioner would submit that the said house property was sold pursuant to the order of the Civil Court in O.S.No.707 of 1995. When the direction was made by Civil Court to register the property in the name of the plaintiff therein, the question of attracting Section 421 of IPC for disposing of the property in order to prevent the distribution of that property among his creditors, does not arise.

Admittedly, as seen from Ex.P2/sale deed executed by accused Nos.1 and 2 in favour of the purchasers therein, it was pursuant to the orders of the Civil Court and the said orders were passed in a suit filed for specific performance. Suit was filed on 21. 09.1993. In the said circumstances, it cannot be said that the accused had disposed off the property in order to prevent the distribution of the same among his creditors. The said sale of the house property was not voluntary, but it was pursuant to Court direction. Therefore, none of the ingredients of Section 421 of IPC are made out in the present circumstances. Accordingly, the revision petitioners succeed and the conviction by the Sessions Court for the offence under Section 421 of IPC is hereby set aside.

The Criminal Revision Case is allowed.