1. The allegations contained in the complaint and the initial deposition of the complainant, even if they are taken at their face value, and accepted in their entirety do not constitute the offences alleged against the petitioner, accordingly, the petitioner claims that the case insofar as he is concerned is liable to be quashed under Section 482, Criminal p. C. for short "the Code". This is the sole contention of the petitioner,
2. The contours of the jurisdiction of the High Court when it exercises its inherent powers under Section 482 of "the Code" have been set out by the Supreme Court amongst other decisions, in R.P. Kapur , Nagawwa; , Madhu Limaye
and State of Karnataka v. L. Muniswamy
3. In R.P. Kapur (supra) three categories of cases have been referred which are illustrative in nature but not exhaustive where the High Court can exercise its inherent jurisdiction to quash a proceeding. One amongst them is that if the allegations in the complaint, even if they are accepted at their face value, do not constitute the offence alleged. However, it has been ruled that the High Court cannot enter into any inquiry as to the reliability of the evidence which is ordinarily the function of the trial court. In Nagawwa (supra) the Supreme Court has categorised the circumstances under which the High Court can exercise inherent jurisdiction Under Section 482 into four compartments. However, these are also illustrative. Appreciation of evidence or reliability of the evidence or re-appreciation of the evidence by the High Court while exercising this power are out of bounds for the High Court. In Madhu Limaye (supra) the negative aspects have been highlighted, that is, the outer limit of the powers of the High Court have been pictured. They are:
(a) The power should not be resorted to if there is a specific provision in the Code for the redress available to the aggrieved party;
(b) the inherent powers should be exercised sparingly only to prevent abuse of the process of the court or otherwise to secure the ends of justice;
(c) it should not be exercised as against the express power contained in any other provisions of "the Code".
4. In Muniswamy 1977 Cri LJ 1125 (supra) the contours of the wholesome power have been set out thus:
The saving of the High Court's inherent powers both in civil and criminal matters is designed to achieve a salutary public purpose which is that a court proceeding ought not to be permitted to degenerate into a weapon of harassment or prosecution....The ends of justice are higher than the ends of mere law though justice has got to be administered according to laws made by the legislature.....
After referring to the rules laid down in R.P. Kapur 1960 Cri LJ 1239 (SC) (supra) it has been observed that the three categories of cases (referred in Kapur) where the High Court would be justified in exercising jurisdiction Under Section 482 are only illustrative, and, cannot in the very nature of things, be regarded as exhaustive. It was observed:
Considerations justifying the exercise of inherent powers for securing the ends of justice naturally vary from case to case and a jurisdiction as wholesome as the one conferred by Section 482 ought not to be encased within the strait jacket of a rigid formulae.
These principles have been structured by their Lordships to achieve the salutary public purpose. Criminal proceedings should not be permitted to be degenerated into a weapon of harassment or a weapon of revenge. Apart from upholding the cause of justice amongst the contending parties the section ensures speedy trial and thereby upholds societal interest. The cases which must fail on the face of the available material need be terminated to grant relief to the accused. It wipes out backlog of cases. The genuine cases obtain precedence over cases having no merits. In terminating the life of such cases the anxieties, worries and sufferances of 'he contending parties are removed. The society is benefited. All these facets have been condensed in Muniswamy (supra) when their Lordships observed that Section 482 "is designed to achieve a salutary public purpose". Their Lordships also ruled that consideration justifying the inherent power should not be encased within the strait-jacket of a rigid formulae as the justifications to exercise the inherent powers for securing the ends of justice necessarily vary from case to case. Therefore if the allegation in the complaint petition and the initial statement do not make out a case against the petitioner 'he proceedings against the petitioner must be quashed Under Section 482 of "the Code".
5. To decide whether the complainant has made out any case against Sri Ramautar Choukhany (the petitioner) let me turn to the complaint. It has been stated in the complaint that the petitioner is a shareholder-cum-Director of M/s. Choukhanibag Tea Company Pvt. Ltd. It is alleged that the petitioner received a sum of Rs. 7000/- from the complainant and promised that he would repay the amount with interest on demand. It is alleged that the petitioner also executed a promissory note to that effect on 21-2-79 in favour of the complainant. The said promissory note was signed by the petitioner as "Director of the Company". It is claimed that the complainant' demanded payment of the amount but without any success. It is alleged that the petitioner along with other accused who were also shareholders arranged for fictitious sale and purchase of shares and liabilities of the company and executed registered sale deed for such transfers. It is stated that the petitioner informed the complainant that his money would be paid by accused 2 who had 1aken the liability in the sale deed dated 2-1-81. However, no payment was made by the petitioner or accused 2. The complainant states in the complaint that he believes that the whole transaction of sale was to cheat the complainant. The learned Magistra'e examined the complainant. The complainant stated that on 21-2-79 the petitioner told him to deposit Rs. 7000/- from his fund and the money would be returned whenever the complainant wanted it. Relying on the statement he deposited Rs. 7000/- but when he demanded the money the accused told him that either accused 2 Prabhudayal or accused 3 Kant a Devi would give the money, however accused 2 and 3 told the complainant that the petitioner would, pay the money. The petitioner executed sale deeds in favour of accused 2 and 3 and in the sale deed it was written that accused 2 would be liable to pay the money taken by the petitioner. However, he did not get the money from any of the accused. In 'he complaint it was stated that copy of the promissory note, sale deed, letter dated 4-5-81 were enclosed, however, I do not find these documents in the records. The petitioner has filed a copy of 'he promissory note dated Feb. 21, 1979. I extract hereinbelow the relevant portion thereof:
X X X X X X
RECEIVED Deposit from Sri Hariram Todi Rs. 7000/- (Rupees seven thousand) only, in cash on condition that re-payable on demand with interest.
The interest payable for first year will be at 12'% per annum and at 18% per annum second year onwards.
For Choukhanybag Tea Company
6. What are the essential requisites of the offence Under Section 420 I.P.C.? A trite question but it needs reiteration. Failure to honour a promise does not by itself amount to an offence Under Section 420 read with Section 415, I.P.C. The essential requisites of the offence are- (1) Deception of any person, (2) (a) fraudulently or dishonestly inducing that person (i) to deliver any property to any person, or, (ii) to consent that any person should retain any property, or (b) intentionally inducing that person to do or omit to do anything which that person would, not do or omit to do but for the deception, and which act or omission causes damage or harm to that person in body, mind or property.
7. Is there any allegation that the petitioner caused any deception? Is there anything in the complaint to show that the petitioner caused the complainant to believe what was false or misleading as a matter of fact or lead him into error? Deception is the quintessence of the offence. It must be caused by the accused to generate inducement in the mind of the complainant. It may be caused by express words or by conduct. The false representation must re-late to a certain future event, it must be deceptive in nature and character and the accused must know it to be fake, or false at the lime when it was made. To hold a person guilty of the offence of swindling or cheating, it has to be shown that his intention was dishonest at the time of making the representation. Such a dishonest intention cannot be drawn from the mere fact that he could not subsequently fulfil his promise due to some change of events, unforeseen circumstances, etc.
8. Now let me consider the facts which stare on the face of the complaint. I find (1) that the money was received as deposit by the petitioner as the Director of the Company, (2) that the amount was so taken for and on behalf of the company, (3) that it was not taken by the petitioner in his personal capacity, (4) there was no question of personal gain of the petitioner in receiving the money, (5) that there was stipulation to pay high interest to the complainant, the maximum being 18% per annum, (6) that when the complainant had paid the amount to the company it was plain and simple that he was to get it back from the company, (7) that the company never dissolved or wound up, (8) that there is no allegation that the complainant deposited the money as a result of any representation made by the petitioner it was pure and simple a voluntary act of the complainant. As such there is no allegation of any deception which impelled the complainant to deposit the money, (9) that the receipt itself speaks in volume that the liability for payment was on the company as it received the amount, (10) that the statement that the petitioner would make the payment was surely made as the Director of the Company and could not have been made in any other capacity (vide: the receipt). There was, therefore, no inducement nor was there any dishonesty in the transaction, even on the own showing of the complainant.
9. The sole circumstance brought to bear up the case is a subsequent event, namely, that the petitioner transferred his shares. However the complaint itself shows that in the sale deed itself the petitioner caused a stipulation to be entered that it would be the obligation of the purchaser, accused 2 to pay up the amount to the complainant. It shows clearly that the parties to the transactions, the petitioner (seller) and accused 2 (the buyer) acknowledged the loan and the petitioner ensured that it would be the obligation of the buyer to pay the amount and accused acknowledged the liability in writing. The act of transfer of the shares was done openly. I see no infirmity in the transfer of shares and fixing the liability on accused 2 who purchased the shares of the petitioner. It is also clearly stated that accused 2 is "the shareholder and Director" of the company. I conclude that no element of the offence of cheating is made out in the complaint. The complainant can, at any time, obtain the amount with due interest by taking resort to a civil ac-lion It is apparent that the complainant has short circuited the matter and he is forcing the petitioner to pay the amount when on the face of the document the liability is on accused
2. The provision of Section 420, I.P.C. has no application in the instant case.
10. Similarly, Section 421 is not applicable in the instant case. To prove an offence under Section 421, I.P.C, prosecution must show-. (1) that the accused removed, concealed or delivered the property or that he transferred it or caused it to be transferred to some one; (2) that such transfer was without adequate consideration: (3) that the accused thereby intended to prevent, or knew that he was thereby likely to prevent the distribution of that property according to law among his creditors or creditors of another person; (4) that he acted dishonestly and fraudulently. There is no material that the transfer was without adequate consideration. Nor is there any iota of material that the transaction was dishonest or fraudulent. The petitioner kept alive the right of the complainant. In my opinion, Section 421, I.P.C, does not. apply in the instant case. I fail to see how Section 406, I.P.C, is applicable in the instant case. The complainant is always entitled to interest for the amount at the rate of 18% per annum until the amount is paid by the company or the Director who has taken upon himself the liability.
11. Therefore, on perusal of the complaint, the initial deposition as well as the documents referred to in the complaint I find that even if the allegations made therein are taken at their face value and accepted in their entirety, they do not constitute the offences alleged against the petitioner. If the petitioner is aggrieved he can take resort to civil suit and recover the amount with interest. But the continuance of the proceeding in the criminal court against the petitioner is simply an abuse of process of court. Accordingly, I quash the proceeding against the petitioner in exercise of power under Section 482 of the Code.
12. In the result, the petition is allowed and the proceeding in so far as the petitioner is concerned, is quashed. Send the records forthwith to the trial court.