Case BriefsHigh Courts

Kerala High Court: The Bench of R. Narayana Pisharadi, J. quashed criminal proceedings against a person accused of cheating a bank holding that the case against him would be an abuse of process of the Court.

Petitioner herein was a customer of Bank of Baroda for many years. He introduced accused’s 1 to 3 to the said bank to enable them to open an account therein. Subsequently, the accused used credit/purchase facility given to them by the bank and obtained approximately Rs 1 crore from it. It was alleged that the accused had hatched a conspiracy to cheat the bank and cause loss to it. A case was registered against the accused and the petitioner under Section 120B, and Sections 420 and 406 read with Section 34 of the Penal Code, 1860. The instant petition was filed under Section 482 of the Code of Criminal Procedure, 1973 requesting quashing of proceedings against petitioner.

The Court noted that the only allegation against the petitioner was that he introduced accused to the bank to enable them to open an account. He did not falsely misrepresent the bank; there was no material indicating any transaction between the petitioner and other accused. No material was produced by the prosecution to prove that the introduction of accused to the bank, by the petitioner, was part of a conspiracy to cheat the bank. Therefore, no question of dishonest misappropriation of any amount by him arose.

It was held that it is a normal banking practice that a person who wants to open an account in a bank will have to get himself introduced by another account holder in the same bank. The mere act of introducing a person to a bank to enable such person to open an account in the bank, without anything more, does not attract the offence of cheating punishable under Section 420 IPC against the person who makes the introduction, even when the person introduced by him subsequently commits an act of cheating against the bank. Reliance in this regard was placed on Manoranjan Das v. State of Jharkhand, (2004) 12 SCC 90.

In view of the above, the petition was allowed. [K.J. Hubert v. Sub Inspector of Police, 2019 SCC OnLine Ker 1122, Order dated 04-04-2019]

Case BriefsHigh Courts

Patna High Court: The Bench of Ahsanuddin Amanullah, J. hearing an application under Section 482 of the Code of Criminal Procedure, 1973, quashed the cognizance taken against the petitioner holding that the subject dispute was purely a civil dispute.

Chairman of an NGO named Bharat Bharati (Educational) Service Institution, instituted a complaint case against the petitioner (Managing Director of the said NGO) alleging non-disbursal of funds received by him from the central government in lieu of certain jobs done by the NGO for the forest department of the State. Cognizance of the said case was taken under Sections 406, 420, 467 and 120(B) of the Penal Code, 1860. Aggrieved thereby, the petitioner moved this Court under Section 482 of CrPC praying for quashing of the learned Magistrate’s order.

The Court observed that a purely civil dispute with regard to the distribution of money among the office bearers of the concerned NGO could not be said to be in the nature of any criminal offence as it was a pure and simple money dispute among the office bearers of the said NGO.

It was opined that where a person is aggrieved by non-payment of money, the only remedy available is under common civil law by way of filing a money suit. Reliance, in this regard, was placed on the judgment in Indian Oil Corpn. v. NEPC India Ltd, (2006) 6 SCC 736 where the practice of settling civil disputes by applying pressure through criminal prosecution was deprecated.

In view of the above, it was held that the institution of complaint case against the petitioner was the abuse of process of the court, and petitioner’s application was allowed.[Rameshwar Prasad Sinha v. State of Bihar, 2019 SCC OnLine Pat 48, Order dated 15-01-2019]

Case BriefsSupreme Court

Supreme Court: A Bench comprising of S.A. Bobde and L. Nageswara Rao, JJ. allowed an appeal filed against the judgment of the Delhi High Court whereby it had dismissed appellant’s writ petition seeking to quash the FIR filed against them.

The case arose out of a property matter between the appellants and the complainant. The parties had entered into an agreement for the development of appellants’ property. However, the said agreement could not be performed due to the statutory ban on new construction in the area. It was the complainant’s case that the appellant was not returning a deposit of Rs 1 crore made at the time of entering into the agreement. Therefore, an FIR under Section 406 IPC was lodged against the appellants. The appellants’ filed a writ petition before the High Court seeking to quash the said FIR; however, the petition was dismissed. Aggrieved thereby the appellants preferred the instant appeal. The complainant opposed the appeal on the ground that the chargesheet had already been filed in the case and therefore the FIR could not be quashed at this belated stage.

The Supreme Court turned down the said contention of the complainant while referring to High Court’s power under Section 482 CrPC. After referring to Joseph Salvaraj A v. State of Gujarat, (2011) 7 SCC 59, the Court observed that “there is nothing in the words of Section 482 which restricts the exercise of the Court’s power to prevent the abuse of process of court or miscarriage of justice only to the stage of the FIR. The power is undoubtedly conferred to prevent abuse of process of any court.” Furthermore, on the facts of the case, the Court held that the money deposited with the appellant could not be said to be an entrustment. In any case, if there was a misappropriation, the remedy was available in a civil court. In the opinion of the Court, the FIR filed under Section 406 IPC was not tenable and therefore it was quashed. The appeal was thus allowed and the judgment impugned was set aside. [Anand Kumar Mohatta v. State (NCT of Delhi),2018 SCC OnLine SC 2447, decided on 15-11-2018]

Case BriefsHigh Courts

Delhi High Court: A Single Judge Bench comprising of Rajiv Sahai Endlaw, J., dismissed an execution first appeal filed against the order of Additional District Judge whereby appellants objection to the execution of a money decree sought by decree-holder against the judgment-debtor was dismissed.

It was contended by the appellant-objector that she was the sole owner of the two properties attached in the execution and the judgment-debtor, her son, had no right over them. The Executing Court dismissed the objections of the appellant holding that in proof of her title to the said properties, the appellant filed only a Power of Attorney of her husband in her favour which wasn’t sufficient. Counsel for the appellant submitted that there was a family settlement, however, neither was any such settlement pleaded in the objections nor any document filed in that regard.

The High Court was of the view that it appeared that the purpose was to delay the execution. The appellant and the judgment-debtors were hand-in-glove with each other and were not making a clean breast of state of affairs. In Court’s opinion, it was an attempt to fabricate the documents. Furthermore, one of the judgment-debtors had already left India. The court observed that appellant-objector could not on one hand claim arms length distance from judgment-debtors and on the other hand represent their interest. The appeal was held to be an abuse of process of Court and thus dismissed.[Charanjit Kaur Virk v. Premlata Sharma,2018 SCC OnLine Del 12020, dated 15-10-2018]

Case BriefsForeign Courts

Supreme Court of Singapore: A Five Judge Bench comprising of Sundaresh Menon, CJ., Andrew Phan Boon Leong, Judith Prakash, Tay Yong Kwang, Steven Chong, JJ., allowed an appeal filed against the order of the High Court whereby the High Court refused to grant a stay in favour of the appellants.

The appellant had entered into four different contracts with different parties and all the contracts contained an Exclusive Jurisdiction Clause (EJC) i.e. in case if any dispute arises between the parties, the High Court of England shall have the exclusive jurisdiction to deal with such dispute. A dispute arose between the appellant and the respondent and the respondent filed a suit against the appellant in Singapore.

The main issue that arose before the Court, in this case, was whether the Assistant Registrar, as well as the High Court, was justified in refusing to grant a stay in suit proceedings in favour of the appellant.

The Court observed that the appellant had made out a good arguable case with regard to the EJC being a term in the contract and not just a part of the written agreement between the parties. EJC was incorporated by the parties’ course of dealings into the Contract. The Court then observed that the rule laid down in the case of The Jian He, [1999] 3 SLR(R) 432 was that in if the party seeking a stay does not have a good arguable or meritorious case then that would be a sufficient ground for the court to refuse a stay order. The only two grounds on the basis of which stay can be refused in cases involving an EJC clause are: abuse of process and denial of justice.

The Court held that neither of the two grounds for refusing the stay were made out and hence there was no strong cause for refusing the grant of stay. Resultantly, the appeal was allowed and a stay was granted by the court on suit proceedings pending against the appellant. [Vinmar Overseas (Singapore) Pte Ltd. v. PTT International Trading Pte Ltd., (2018) SGCA 65, order dated 22-10-2018]

Case BriefsHigh Courts

Jammu & Kashmir High Court: A Single Judge Bench of M.K. Hanjura, J., allowed a petition under Section 561-A of CrPC, 1989 [Jammu & Kashmir], whereby petitioner sought quashing of FIR against him.

The main question that arose for consideration was whether a High Court exercising its inherent powers can quash an FIR without conducting a proper trial.

The Court observed that a High Court is entitled to quash a proceeding if it comes to the conclusion that allowing the proceeding to continue would amount to abuse of the process of the Court or that the ends of justice require that the proceeding ought to be quashed. Further, the Court referred to the decision of the Supreme Court in the case of State of Haryana v. Bhajan Lal, 1992 Supp (1) SCC 335, wherein the Supreme Court elaborately considered the scope of Section 482 Cr. P.C. In that case, the Supreme Court held that inherent powers can be used by the High Courts to prevent the abuse of process of the Court and to secure the ends of justice.

The Court held that the list of cases where a High Court can exercise inherent powers under both civil and criminal laws is not exhaustive in nature. The Courts have the inherent powers apart from express provisions of law which are necessary for proper discharge of functions and duties imposed upon them by law. The Court concluded by holding that Courts are invested with all such powers as are necessary to do right and to undo a wrong in the course of administration of justice on the principle of “Quando lex aliquid alicui concedit, conceditur et id Sine quo res ipsa esse non protest” (When the law gives the person anything, it gives him that without which it cannot exist). The petition was allowed and the impugned FIR was quashed.[Nisar Ahmad v. State of J&K,2018 SCC OnLine J&K 516, order dated 24-08-2018]

Case BriefsHigh Courts

Gauhati High Court: A Single Judge Bench comprising of Mir Alfaz Ali, J., dismissed a criminal petition filed under Section 482 CrPC wherein the petitioners sought quashing of charge-sheet and proceedings in criminal cases.

The petitioners were alleged to have trespassed into the land of Respondent 2 and caused damages to the fencing and RCC post. A criminal case was registered and charge-sheet was submitted under Sections 447, 427, 452 IPC against the petitioners.

The High  Court observed that witness statements under Section 161 CrPC clearly show that petitioners trespassed into the land of Respondent 2. A prima facie case for the said was made out. It was noted to be a trite law that for the purpose of exercising inherent power under Section 482, the Court needs to see whether allegations made in the FIR or evidence collected, on its face value, make out any offence. The Court relied on Radhey Shyam Khemka v. State of Bihar, (1993) 3 SCC 54, wherein it was held that the High Court while exercising such power cannot usurp the jurisdiction of trial court. The power has to be exercised to quash prosecution that amounts to abuse of process of court. It cannot be used to hold a parallel trial. In the instant case, having found that there was a prima facie case, the Court declined to interfere with the proceedings impugned. [Promod Adhikari v. State of Assam,2018 SCC OnLine Gau 822, dated 27-07-2018]