Narender Singh vs Rajinder Kumar Lamba and Others

A.K. Sikri, J.—The respondent No. 1 - Rajinder Kumar Lamba (hereinafter referred to as ''the complainant'') has filed complaint against the

petitioner as well as against the respondent Nos. 2 & 3 herein. This complaint is under Sections 420/406/506 Part-II/448/480 read with Section

120B of the Indian Penal Code, 1860 (for short, ''IPC''). It is alleged in this complaint by the complainant that he is a property dealer and deals in

the business of sale and purchase of properties from his residence in Paschim Vihar, Delhi. On 27.9.1995, Narender Singh (petitioner herein) and

his sister Devinder Kaur (accused No. 2 in the complaint) approached the complainant and offered the property No. 72, Ring Road, Lajpat

Nagar-III consisting of two and a half story building over an area of 792 sq.yds. for sale. They represented that this property was in the name of

their father Sahib Singh, who died in September 1991, leaving behind Will dated 20.4.1970 in respect of this property and as per the said Will, the

petitioner and Devinder Kaur (hereinafter referred to as ''the accused Nos. 1 & 2'') had inherited 2/7th and 1/7th share respectively. The petitioner

agreed to sell his 2/7th undivided share to the complainant. An agreement to sell dated 27.9.1995 was entered into between the complainant and

the petitioner/accused No. 1. Accused Nos. 1 & 2 had also represented that this property was free from all encumbrances at the time of execution

of the agreement to sell dated 27.9.1995. However, subsequently the accused Nos. 1 & 2 neither handed over the peaceful and lawful possession

of the property in question to the complainant nor returned his earnest money and rather they handed over the possession of the property in

question to Shri Sudhir Kr. Gupta, a partner of M/s. SS Associates (accused No. 3 and respondent No. 2 in this petition). On the basis of these

allegations, the complaint has been filed.

The complainant examined, at pre-summoning stage, three witnesses, namely, the complainant himself as CW-1, Mr. Ashok Kumar Nanda as

CW-2 and Mr. Preet Pal Singh as CW-3. On the basis of the allegations contained in the complaint and after going through the evidence, the

learned MM vide order dated 8.8.2000 was pleased to summon all the three accused observing that they were prima facie liable to be proceeded

against for the offences under Sections 420/406/506 Part-II/448/480 read with Section 120B IPC.

Accused No. 1, after receiving the summons, filed application for dropping him from the proceedings. The learned MM dismissed this

application vide order dated 12.9.2002. Challenging this order, the petitioner filed revision petition before the learned ASJ, Delhi. The revisional

court partly allowed the revision petition vide order dated 1.4.2004confining the offence u/s 420 read with Section 34 IPC only and discharged the

accused persons for the offence under Sections 406/448/380/120B IPC. Still feeling aggrieved, order dated 1.4.2004 is challenged by the

petitioner by means of the present petition.

The petitioner accepts the execution of the agreement to sell whereby he agreed to sell his 02/7th share in the undivided property in question to

the complainant for a consideration of Rs. 48.50 lacs. Case put up by him, however, is that out of this amount, the complainant had paid a sum of

Rs. 3.50 lacs and the balance amount of Rs. 45.00 lacs was to be paid at the time of final documentation, which the complainant failed to pay on

one pretext or the other. Just to gain time, the complainant filed a suit being CS(OS) No. 2100/1996 for specific performance of contract in this

regard on or about 28.9.1996 and obtained interim injunction. His submission is that as an afterthought, much thereafter in the year 1999, a

criminal complaint was filed by the complainant in which process was issued on 8.8.2000. Contention of the petitioner, Therefore, is that the entire

dispute is of civil nature and the cognizance of the complaint was wrongly taken by the learned MM. In order to support this contention, he has

stated that in the suit filed by the complainant the petitioner, through his counsel, has made a statement on 10.9.2001 that the petitioner was ready

to suffer the decree and the following order was passed:

S. No. 2100/96

At this stage, learned Counsel for defendant No. 1 stated that defendant No. 1 is already to suffer the decree. Let affidavit of defendant No. 1 in

their regard be filed.

Learned Counsel for the plaintiff seeks time to take necessary instructions in this regard.

Accordingly, he filed the affidavit dated 11.10.2001 specifically stating in para 5 thereof that he was abiding by the statement his counsel made

before the Court on 10.9.2001 and ""hereby confirm and state that the suit of the plaintiff may kindly be decreed on payment of balance sale

consideration of Rs. 45 lacs by the plaintiff to him"". He further pointed out that instead of making payment of the balance consideration, the

complainant filed counter affidavit dated 22.10.2001 stating as under:

That the only question which now remains to be determined/adjudicated upon by this Hon''ble Court in the above case is to whether the balance

consideration payable by the defendant No. 1 to the plaintiff is Rs. 38,50,000/- or Rs. 45,00,000/- as claimed by the defendant No. 1 at the time

of handing over of vacant physical possession of the property to the plaintiff.

DEPONENT

It is his contention, Therefore, that even according to the complainant, the only dispute was as to whether the balance consideration was Rs. 45

lacs or Rs. 38.50 lacs and this was purely civil dispute. On the basis of the aforesaid facts, learned Counsel for the petitioner submitted that the

complaint filed by the complainant was a glaring example of abuse of process of law. Summoning of an accused in a criminal case was a serious

matter and criminal law could not be set into motion as a matter of course. He has submitted that the courts below failed to appreciate that the

complainant was a property dealer and the filing of the criminal complaint was nothing but a pressure tactic, which was filed much after the filing of

the civil suit. He also referred to the following judgments in support of his submission:

Dwarikesh Sugar Industries Ltd. Vs. Prem Heavy Engineering Works (P) Ltd., and another,

Ajay Kumar Bhuyan and Ors. v. State of Orissa and Ors. 2003 LAB IC 78

Chandrapal Singh and Others Vs. Maharaj Singh and Another,

Punjab National Bank and others Vs. Surendra Prasad Sinha,

G. Sagar Suri and Another Vs. State of U.P. and Others,

Pepsi Foods Ltd. and Another Vs. Special Judicial Magistrate and Others,

Nageshwar Prasad Singh alias Sinha Vs. Narayan Singh and Another,

In support of the submission that for a civil dispute there cannot be a criminal prosecution, he referred to the following judgments:

G. Sagar Suri (supra)

Indian Oil Corporation Vs. NEPC India Ltd. and Others,

He also submitted that there is no absolute proposition that no criminal prosecution can take place along with the civil proceedings. In certain

circumstances, criminal prosecution can take place in only exceptional cases, but in the instant case there is no such situation and a private

complaint has been lodged falsely on the alleged breach of contract and it involves only civil disputes pertaining to agreement to sell. In this regard,

he placed reliance on the following:

G. Sagar Suri (supra)

Hridaya Ranjan Pd. Verma and Others Vs. State of Bihar and Another,

Qadir Khan and Others Vs. State of U.P. and Another,

Farhana Nasreen and Another Vs. State of Bihar and Another,

M/s. Pepsi Foods Ltd. (supra)

M/s. Indian Oil Corporation (supra)

Learned Counsel for the petitioner also endeavored to show that complaint of the complainant was false on the face of it.

Learned Counsel for the complainant, on the other hand, submitted that when the act on the part of the accused gave rise to filing of civil as well

as criminal action, it was permissible for the complainant to file both civil as well as criminal cases and merely because a suit was filed would not

mean that the complainant was prevented from filing the criminal case when the case of cheating as well as commission of crime under other

sections was made out. He submitted that at the time of execution of agreement to sell and payment of earnest money, the complainant was handed

over part possession i.e. vacant garage of the said property. He also submitted that at that time it was represented that by virtue of the Will, 2/7th

share each devolved upon 3 sons and 1/7th upon the accused No. 2. The accused Nos. 1 & 2 had agreed to sell their 2/7th and 1/7th share

respectively. In respect of the 2/7th share each in favor of the other two sons, namely, Avtar Singh and Inderjit Singh, it was reported that they

were living abroad and had executed a power of attorney in favor of the accused No. 2 on the basis of which she would deal with the said share in

the property. Since share of the petitioner/accused No. 1 was undivided, a suit for partition being Suit No. 1213/1996 was filed in this Court to

enable the petitioner to get separate possession of his share to complete the sale in favor of the complainant. An application for appointment of

local commissioner was also made along with the said suit because on 8.5.1996, few days before the filing of the suit, the tenant had vacated the

house and it was apprehended that the accused No. 2 would do some illegal activity. On 20.5.1996, this Court appointed a Local Commissioner

and passed an interim order. The Local Commissioner filed her report dated 25.5.1996 and contents of the report are explicit about the criminal

intent of the accused No. 2 and her abettors M/s. SS Associates through its partner Sudhir Gupta (accused No. 3 in the complaint). She stated

that possession of the entire property has been given to M/s. SS Associates. The petitioner/accused No. 1 being the plaintiff was also present

when the Local Commissioner visited the property but he did not object to the doings of the sister or when he had already given the possession to

the respondent No. 1/complainant of the garage. At that time the accused No. 2 did not disclose to the Local Commissioner as to when she had

entered into any deal with M/s. SS Associates (accused No. 3). Subsequently, the accused No. 2 filed a report dated 12.11.1995 of handing over

possession of garage to M/s. SS Associates. He further submitted that though the petitioner agreed to suffer the decree, which was an empty

formality without any bona fides, inasmuch he wanted payment of balance amount without giving possession and, Therefore, this offer of the

plaintiff was declined by the court. His further submission was that the complainant was admittedly deprived of the possession of the garage though

it was initially given and, Therefore, offence u/s 448 IPC was made out. Likewise, his allegation was that he had kept certain articles in the said

garage, which were removed while giving possession of the garage to M/s. SS Associates and this constituted an offence u/s 380 IPC. He also

submitted that since all the accused persons conspired, a prima facie case u/s 120B as well as u/s 420 IPC was made out as by entering into

agreement with M/s. SS Associates it was established that the intention was to cheat the complainant. He further submitted that since these events

took place after the filing of the suit, on the basis thereof filing of the criminal complaint became necessary. It was also submitted that in Suit No.

1213/1996, the co-sharers readily agreed to implead M/s. SS Associates, who are in same legal position as that of the complainant, but opposed

his request for impleadment and his request was disallowed. The preliminary decree for partition was passed on 18.1.2001 and till date no steps

have been taken to have the property divided by metes and bounds. Since, the complainant is suffering from kidney failure he wanted to be imp

leaded to expedite the matter, which was opposed. Therefore, it is submitted that the accused Nos. 1, 2 & 3 are together liable to be prosecuted

and the impugned order be reversed and matter be sent for trial by striking down the order.

Perusal of the order of the learned ASJ would show that according to him offences under Sections 380/448/506/406/120B IPC were not made

out and the petition qua these provisions has been allowed. He has held that the petitioner and the respondent No. 2 (accused Nos. 1 & 2

respectively) be tried for the offence u/s 420 read with Section 34 IPC only. The complainant has not challenged this order of the learned ASJ.

Therefore, it is no longer open to the complainant to allege the facts on the basis of which offence under those provisions, in which the accused

persons are discharged, is sought to be made out. That portion of the order passed by the learned ASJ whereby he has discharged the accused

persons of certain provisions reads as under:

As regards the offence u/s 380 IPC, I find from the complaint that the complainant does not disclose the list of articles, if any, that were

subjected to the theft at the hands of the accused except the bald statement of the complainant - at para No. 9 - which date is not mentioned.

From the progression of the facts stated, it can be seen that after the incident, the complainant had paid the further amount to the accused.

Further, I also find from the complaint that the offence u/s 506 IPC, is not made out except general allegation found in para 7 of the

complainant (sic). These allegations are not supported by the requisite and necessary details to constitute any offence....

Thus, we are left with the offence of cheating only and in this petition only that limited aspect is to be examined. Some of the discussion, whereby

the learned ASJ held that case of dishonest intention to misappropriate the amount of sale consideration for the offence u/s 406 IPC is not made

out, may be reproduced below, which may have bearing on this aspect:

Coming back to the evidence available on record, it is very difficult to gather that the accused number 1 and 2 had any dishonest intention to

misappropriate the amount of sale consideration. Further, the alleged trespass dt. 8.9.96, and the alleged theft were to be believed, CW1 would

never have parted with a huge sum thereafter on 15.4.98. The conduct of the complainant in advancing further sum towards sale consideration of

the agreement inspire of having realised the dishonest intention of accused number 1 and 2 in not handing over the possession and implanting

accused number 3 by way of trespass as alleged with regard to the events of 8.5.1996, it becomes highly imaginary to conceive dishonest intention

at the inception. No party would part with huge sum nearly after the lapse of two years, even after facing trespass and theft. Therefore, the events

of 8.5.96, becomes doubtful. Further, the alleged theft to kill is bereft of necessary particulars and details so as to adumbrate the offence if any, as

defined under the law.

CW2 was also examined in the pre summoning stage and he says that he know the parties, he only corroborates the execution of agreement

dt. 27.9.1995 and handed over the part possession of the garage.

CW3, Preet Pal Singh i.e. the party to the complainant, had deposed that the complainant paid Rs. 3 lacs 50 thousands and the second

Installments of Rs. 6 lacs 50 thousand. CW2 and 3 are not the witnesses to the offence alleged u/s 448/380/506 IPC.

AS I have discussed the material available on record both documentary as well as the oral testimony of CW1, I am unable to comprehend as

to how these offences could be made out prima-facie.

It is clear from the above that the learned ASJ was of the opinion that there was no dishonest intention to misappropriate the amount of sale

consideration. There was no case of trespass made out as well. In spite of the aforesaid observation, while dealing with the allegation Constituting

offence u/s 420 IPC, the learned ASJ observed as under:

In the instant case, the complainant was represented and he acted in pursuance of the representation made by accused number 1 and 2 to part with

the money in the guise of agreement to sell. Though, the element of dishonest and fraudulent intention was not found out at the inception, the same

had cropped up during the further course of between the complainant and the accused number 2 in the above case as per allegations. According to

the complainant, accused number 3 is in possession which was earlier delivered to him. If this be so, at this stage, we cannot spurn the allegations

as lacking bonafides. Therefore, it can be for the purpose of prima-facie case, gathered that the offence u/s 420 IPC could be made out against the

accused number 1 and 2 in not handing over the possession as promised. Therefore, I find for the limited examination of the material available on

record that the offence u/s 420 IPC could be made out from the case on record.

In the backdrop of earlier findings and observations of the learned ASJ, the aforesaid conclusion would not be correct one. Once he himself

found that there was no dishonest intention and fraudulent intention at the inception, in the facts of this case, I fail to comprehend as to how such an

intention was developed afterwards. The only reason given is that the accused No. 2 did not handover the possession as promised. However, it

could not be disputed that the petitioner had only undivided 2/7th share in the property. It is also not in dispute that the petitioner had filed a suit for

partition, which is pending in this Court. In the absence of there being partition by metes and bounds, he could not have given the possession. He

could only give symbolic possession of his 2/7th undivided share and not actual physical possession. Further, insofar as the petitioner/accused No.

1 is concerned, in the suit for specific performance filed by the complainant he had made a categorical statement that he was ready to fulfill his part

of the agreement by selling his 2/7th share in the property. Agreement with M/s. SS Associates is entered into by the accused No. 2, which is in

respect of the remaining 5/7th share, namely, 1/7th undivided share belonging to the accused No. 2 and 2/th undivided share each belonging to her

other two brothers. Neither the accused No. 2 nor her two brothers were party to the agreement to sell between the petitioner and the

complainant. Agreement to sell, insofar as the complainant is concerned, is in respect of the 2/7th undivided share of the petitioner only. There is

nothing on record to suggest that the accused No. 2 had agreed to sell her share or the share of her two brothers to the complainant. The

complainant admits that the accused No. 2 was having Power of Attorney on behalf of the two brothers. Therefore, had there been any intention to

sell by the accused No. 2, she could have sold the remaining 5/7th share as well when the agreement to sell was executed between the petitioner

and the complainant. We have to see the element of cheating on the part of the petitioner which is totally lacking.

In G. Sagar Suri (supra), the Supreme Court made the following pertinent observations:

8... It is to be seen if a matter, which is essentially of a civil nature, has been given a cloak of criminal offence. Criminal proceedings are not a short

cut of other remedies available in law. Before issuing process a criminal court has to exercise a great deal of caution. For the accused it is a serious

matter. This Court has laid certain principles on the basis of which the High Court is to exercise its jurisdiction u/s 482 of the Code. Jurisdiction

under this section has to be exercised to prevent abuse of the process of any court or other wise to secure the ends of justice.

9... In State of Karnataka v. E. Muniswamy this Court said that in the exercise of the wholesome power u/s 482 of the code of High Court is

entitled to quash a proceeding if it comes to the conclusion that allowing the proceeding to continue would be an abuse of the process of the court

or that the ends of justice require that the proceedings are to be quashed.

11... In Chandrapal Singh v. Maharaj Singh, the judgment started as under (SCC p.467, para 1).

A frustrated landlord after having met his waterloo in the hierarchy of civil courts, has further enmeshed the tenant in a frivolous criminal

prosecution which prima facie appears to be an abuse of the process of law. The facts when stated are so telling that the further discussion may

appear to be superfluous.

This Court said (SCC p.474 para 14)

We see some force in the submission but it is equally true that a charined and frustrated litigants should not be permitted to given vent to their

frustration by cheaply invoking jurisdiction of the criminal court. Complainant herein is an advocate. He lost in both courts in the rent control

proceedings and has now rushed to the criminal court. This itself speaks volumes. Add to this the fact that another suit between the parties was

pending from 1975. The conclusion is inescapable that invoking the jurisdiction of the criminal court in this background is an abuse of the process

of law and the High Court rather glossed over this important fact while declining to exercise its power u/s 482 Cr.P.C.

Without burdening this judgment with further case law, as cited by learned Counsel for the petitioner, purpose would be served by referring to a

recent judgment of the Apex Court in the case of M/s. Indian Oil Corporation (supra) wherein after taking stock of the available judgments, the

Supreme Court took note of the growing tendency of converting civil disputes into criminal cases by levelling frivolous allegations, as would be

clear from the following observations:

While on the issue, it is necessary to take notice of a growing tendency in business circles to convert purely civil disputes into criminal cases.

This is obviously on account of a prevalent impression that civil law remedies are time consuming and do not adequately protect the interests of

lenders/creditors. Such a tendency is seen in several family disputes also, leading to irretrievable break down of marriage/ families. There is also an

impression that if a person could somehow be entangled in a criminal prosecution, there is a likelihood of imminent settlement. Any effort to settle

civil disputes and claims, which do not involve any criminal prosecution should be deprecated and discouraged.

It was further observed that:

While no one with a legitimate cause or grievance should be prevented from seeking remedies available in criminal law, a complainant who initiates

or persists with a prosecution, being fully aware that the criminal proceedings are unwarranted and his remedy lies only in civil law, should himself

be made accountable, at the end of such misconceived criminal proceedings, in accordance with law. One positive step that can be taken by the

courts, to curb unnecessary prosecutions and harassment of innocent parties, is to exercise their power u/s 250 CrPC more frequently, where they

discern malice or frivolousness or ulterior motives on the part of the complainant. Be that as it may.

In a case like this, I am of the view that the remedy for the complainant was to file suit for specific performance as the dispute is of a civil

nature, which he filed in the year 1996. No subsequent events took place on the basis of which he could file a criminal complaint in the year 1999.

The allegations of subsequent events, namely dispossession from the garage, theft, threats etc. have not been substantiated and the learned ASJ has

himself quashed the process in respect of these provisions. The matter is, Therefore, purely of civil nature. This petition is, accordingly, allowed and

the summoning orders issued against the petitioner under Sections 420/34 IPC are quashed.

No costs.