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Bhola Nath Arora and anr. Vs. the State - Court Judgment

LegalCrystal Citation
SubjectCriminal
CourtDelhi High Court
Decided On
Case NumberCriminal Revision Appeal No. 256 of 1980
Judge
Reported in1982CriLJ1482; 22(1982)DLT32
ActsCode of Criminal Procedure (CrPC) , 1973 - Sections 177 and 240; Indian Penal code, 1860 - Sections 420
AppellantBhola Nath Arora and anr.
RespondentThe State
Advocates: K.K. Sud,; D.B. Sethi and; R.K. Chadha, Advs
Cases ReferredWarburton v. Loveland
Excerpt:
.....offence under section 420 - courts at place where deception practiced and inducement made have jurisdiction to try offence - courts mentioned in section 182 also competent to try offence in addition to such court - held, courts at delhi competent to try offence. - - (3) after entering appearance the petitioners moved an application, purported to be under section 239/294 of the code, contending that the subject matter of the challan was just a business transaction between the parties and at best it gave rise to civil liability. further they expressed a desire to be examined before framing of the charge and contended that the investigating agency has manoeuvred and twisted the facts in order to usurp jurisdiction at delhi for investigation even though no part of the cause of..........with the endorsement 'refer to drawer' on two cheques and 'not arranged for' on the other two cheques. the complainant further contended that after the removal of the goods and subsequent to the dishonour of the cheques, the petitioners did not at all contact the complainant and inform them as to why the cheques had been dishonoured. thus, it was alleged that the petitioners had dishonest intention right from inception and with intent to cheat the complainant and cause wrongful loss to them and wrongful gain to themselves they did all this. the complainant asserted that the conduct of the petitioners proved their dishonest and fraudulent intention from the very beginning and even when they were contacted personally they told them that they had succeeded in obtaining the goods worth.....
Judgment:

J.D. Jain, J.

(1) M/S. Bhagat Industrial Corporation Limited (hereinafter referred to as the Complainant) has its registered office at Khasa, District Amritsar and its Head Office is situated at 54, Janpath, New Delhi. It, inter alia, deals in Indian manufactured foreign liquor and had wholesale license for the same in Uttar Pradesh uptill 31st March, 1976. The whole sale business of liquor in Uttar Pradesh was being managed from its Branch at Kanpur Cantonment. Since the company was left with huge quantities of unsale stock by end of the term of its license, the license was extended up to 30th April, 1976 and as per terms of the license the Complainant was required to sell the unsold quantity to a Wholesale merchant only after obtaining prior permission of the District Excise Authorities, Kanpur. On 1st November, 1976, the Complainant lodged a report through Mr. O. N. Seth, their Export Manager, with Police Station Gonnaught Place, New Delhi, contending that sometime in the last week of April, 1976, S/Shri Bhola Nath Arora and Raman Arora (the present petitioners), who described themselves as partners of M/s. B. D. Raman Arora, Varanasi, contacted the Go nplainant through Mr. Seth at their Head Office at 54, Janpath, New Delhi and expressed a desire to lift the unsold liquor of various brands lying with the Complainant at Kanpur. Since the financial position of the petitioners was not known to the complainant, they were reluctant to agree to the said proposition except against payment in cash. However, the petitioners represented that they were men of lakhs and they would make part payment by means of bank, draft and the balance by Installments through post-dated cheques to be issued by them. Since the unsold quantity as on 30th April, 1976, could be sold to a wholesale dealer in Uttar Pradesh only, necessary permission was obtained by the Complainant from the Excise Department, Kanpur, on 7th May, 1976, and the petitioners took delivery of the goods covered under invoice Nos. 1560, 1561 and 1562, all of even date of 9th May, 1976. They assured Mr. Seth that payment would be made and thus they induced Mr. Seth to accept part payment by bank draft and balance payment by post-dated cheques and to effect delivery. The total value of the goods thus delivered to the petitioners on 9th May, 1976, came to Rs. 1,44,252/36 P out of which a sum of Rs. 27,000.00 was paid by the petitioners by means of a demand draft and for the balance amount four cheques dated 5th June, 1976, dated 24th June, 1976, 19th July, 1976 and 14th August, 1976, in the sums of Rs. 29,313/36, Rs. 29,313.00 , and Rs. 29,313.00 respectively were delivered by them to Mr. Seth. The said cheques were presented on the due dates to the Bankers of the petitioners but the same were returned unpaid with the endorsement 'refer to drawer' on two cheques and 'not arranged for' on the other two cheques. The complainant further contended that after the removal of the goods and subsequent to the dishonour of the cheques, the petitioners did not at all contact the Complainant and inform them as to why the cheques had been dishonoured. Thus, it was alleged that the petitioners had dishonest intention right from inception and with intent to cheat the Complainant and cause wrongful loss to them and wrongful gain to themselves they did all this. The Complainant asserted that the conduct of the petitioners proved their dishonest and fraudulent intention from the very beginning and even when they were contacted personally they told them that they had succeeded in obtaining the goods worth Rs 1,44,252/36 P for just Rs. 27,000.00 . It was submitted that the Complainant would not have delivered the goods but for the inducement that the delivery was being effected against post-dated cheques with the assurance that the same would be honoured on presentation on due dates.

(2) The Police after investigation put in a challan under Section 173, Code of Criminal Procedure (for short the Code), for prosecution of the petitioners under Section 420, Indian Penal Code.

(3) After entering appearance the petitioners moved an application, purported to be under Section 239/294 of the Code, contending that the subject matter of the challan was just a business transaction between the parties and at best it gave rise to civil liability. They also sought permission to produce certain documents in order to demolish the allegations of the prosecutions in regard to the ingredients of cheating. Further they expressed a desire to be examined before framing of the charge and contended that the investigating agency has manoeuvred and twisted the facts in order to usurp jurisdiction at Delhi for investigation even though no part of the cause of action had arisen at Delhi and the goods were delivered as well as received in the State of Uttar Pradesh.

(4) Vide impugned order dated 4th August, 1980, the learned Magistrate while rejecting their aforesaid prayer found that the facts disclosed prima facie a case under Section 420, Indian Penal Code and that the Court at Delhi had jurisdiction to try the same. Hence, feeling aggrieved the petitioners have come up in this revision.

(5) The learned counsel for the petitioner has, at the very outset, convassed with considerable fervour that the transaction in question is just a routine business dealing where goods are sold on credit and the question of any cheating or dishonest intention on the part of the petitioners at the time of the sale and delivery of goods did not arise. Adverting to Section 415, Indian Penal Code, which defines cheating, he has urged that two essential ingredients must be proved before an offence of cheating can come into existence. In the first instance, there must be deceit and secondly, there must be fraudulent and dishonest inducement to the person deceived to deliver any property or goods. In other words, deceit must have been practiced before the property is delivered. Thus, his submission precisely is that even though there was delivery of property to the petitioners, as alleged by the complainant but there was no deceitful inducement as such to do so. He has sought to countenance this argument by adverting to the broad facts of the case, namely, that the wholesale license for Indian made foreign liquor of the Complainant having expired on 30th April, 1976, the Complainant was faced with a grave situation i.e. threat of total loss with regard to the amount of the excise paid by them. It is pointed out that, according to the excise rules obtaining in Uttar Pradesh, once excise duty has been paid, it is not refundable and at best the Complainant could claim the cost of the unsold liquor from the Excise Department. Hence, the anxiety on the part of the Complainant to find out some suitable customer. It was in this background that the Complainant contacted the petitioners and persuaded them to purchase their unsold stock. Be that as it may, this contention of the petitioners cannot be entertained at this stage because for framing a charge under Section 420 of the Code, the only material which can be looked into is the police report, the documents sent with it and the examination of the accused, if any. The Court cannot embark upon an enquiry as to whether the evidence in this case is reliable or not to justify the framing of the charge. Hence, having regard to the prosecution version as laid, there can be little, doubt the ex-facie the petitioners approached the Complainant for sale of unsold stock of liquor to them. Even otherwise it docs not stand to reason that the Complainant would have on their own suggested the petitioners to pay the price of the liquor by Installments and issue post-dated cheques in respect of the same. At least, such a course does not appeal to reason. On the other hand, the circumstances clearly show that the petitioner Shri Raman Arora opened an account with Union Bank of India at Varanasi on 28th April, 1976, by depositing Rs. 500.00 . Thereafter, further sums of Rs. 9,000.00 and Rs. 20,000.00 were deposited on 28th April, 1976 and 6th May, 1976, respectively and withdrew sum of Rs. 27,027.00 by means of a bank draft on 8th May, 1976. Obviously, the bank account was opened with the avowed object of making part payment to the Complainant by means of bank draft. The learned counsel for the petitioner has also canvassed fervently that on the prosecution's own showing the petitioners did not make any representation that they were affluent persons and had plenty of money. A perusal of the police report under Section 173 would show that on the Complainant asking for cash payment down right against delivery of goods, Shri Bhola Nath said that so much amount could be paid in cash only by some Birla i.e. by some big industrialist. But he agreed to pay a part of the price in cash and promised to pay the balance by sale of goods. So, they issued post-dated cheques. This appears to be a natural course of events when a transaction involving substantial amount is negotiated. Hence, prima facie there is evidence for the presumption that the petitioners must have held out an assurance to the Complainant that the balance price will be paid by means of Installments and the cheques would be honoured as and when presented on due dates.

(6) No doubt, the drawing up of a cheque does not imply any representation that the drawer has money in the Bank to the amount shown in the cheque, for he may either have authority to over draw or have an honest intention of paying in the necessary money before the cheque can be presented. In this context a post-dated cheque is a mere promise to pay on a future date and the mere fact that the cheque is dishonoured may not in itself give rise to a criminal offence. However, the position is different where the property is purchased by the accused and the price is paid by cheque. In such a case there is an implied representation that (i) the cheque is a good and valid order for payment of the amount and, (ii) that the cheque would be paid when presented for payment. Illustration (f) to Section 415, Indian Penal Code, provides a clue to the mind of the legislature in such matters. The said illustration is as under L:-

'Aintentionally deceives Z into a belief that A means to repay any money that Z may lend to him and thereby dishonestly induces Z to lend him money. A not intending to repay it. A cheats.'

(7) On its plain language it is manifest from this illustration that what is material is the intention of the drawer at the time the cheque is issued, and the intention has to be gathered from the facts on the record. If from the circumstances it is established that the failure to meet a cheque was not accidental but was the consequence expected by the accused, the presumption would be that the accused intended to cheat. Reference in this context be made with advantage to Keshavji Madavji v. Emperor, A.I.R. 1930 Bom 179, Ajodhya Prasad v. Chiranjilal, : AIR1957All246 and Shantilal v. State, .

(8) In Keshavji Madhavji (supra), the facts were that accused induced the complainant to advance a loan to them and gave a post-dated cheque representing to him that the cheque would be encased on the due date. Broomficld,J., who spoke for the court, summed up the legal position at page 181 as follows:

'WHATthe prosecution has to do, I take it, in a case of this kind is to establish facts which point prima facie to the conclusion that the failure to meet the cheque was not accidental but was a consequence expected and thereforee intended by the accused. It will then be for the accused to establish any facts there may be in his favor which are specially within his knowledge and as to which the prosecution could not be executed to have any information.'

(9) I am in respectful agreement with this observation inasmuch as the prosecution can only establish some objective facts as to Warrant an inference of fraudulent intention on the part of the accused and it is then for the accused to come forth with facts within his special knowledge to show that despite reasonable precautions taken by him he could not prevent the cheques being dishonoured. In other words, dishonour of cheques was accidental and not known and expected consequence of his conduct. In the instant case, as many as four cheques were dishonoured on different dates. The bank account shows that at no stage any attempt was made by the petitioners to pay in sufficient amount for encashment of the cheques. The reason for this, according to the learned counsel for the petitioner, is that the goods supplied by the complainant were defective as being sedimented and the complainant was informed of the same specifically vide their letter dated 20th May, 1976. Thereafter, in response to the petitioner's communication the complainant deputed their Sales Representative Shri J.S. Virk to see Raman Arora, petitioner No.2 at Varanasi and he carried samples of defective liquor on 24th June, 1976, against a signed endorsement original whereof has been filed in Court. Be that as it may, it it essentially a matter to be gone into at the stage of trial. As already observed, at the stage of charge such like evidence cannot be considered in view of the explicit language of Section 240 of the Code. How far the petitioners succeed in establishing the facts in justification of their defense for not depositing sufficient money in the bank to meet the demand of the complainant against cheques on due dates is evidently a matter to be gone into by the trial Court at the appropriate stage and I need not make any observation with regard to the same. As at present, all I need say is that the material on the record is sufficient to afford a ground for presuming that the petitioners have committed an offence under Section 420, Indian penal Code. It may, however, be pertinent to add here that Shri Bhola Nath, petitioner, has since died and we are now concerned only with Shri Raman Arora, petitioner No.2. Admittedly, he is holding a license FL-2 in his own name and it was he who had issued the cheques in question on behalf of the firm M/s B.D.Raman Arora although the cheques were issued in the account of M/s. R.S. & Company.

(10) The next submission of the learned counsel for the petitioner is that the Court at Delhi lacks territorial jurisdiction to try this offence inasmuch as the goods in question were delivered by the complainant to the petitioners in Uttar Pradesh and the same were received by the latter in Uttar Pradesh. He has adverted to Section 182 of the Code in an attempt to canvass that it impliedly excludes the general rule embodied in Section 177 of the Code that every offence shall ordinarily be enquired into and tried by a Court within whose local jurisdiction it was committed. Sub- Section (1) of Section 182 reads as Under :

'ANYoffence which includes cheating may, if the deception is practiced by means of letter of telecommunication messages, be inquired into or tried by any Court within whose local jurisdiction such letters or messages were sent or were received; and any offence of cheating and dishonestly inducing delivery of property may be inquired into or tried by a Court within whose local jurisdiction the property was delivered by the person deceived or was received by the accused person.'

(11) Counsel for the petitioner relies on the second part of this Sub- section to countenance his argument that the instant being an offence of cheating and dishonestly inducing delivery of property can be inquired into or tried by a Court within whose local jurisdiction the property was delivered by the Complainant or was received by the petitioners and by necessary implication the jurisdiction of the Court at Delhi will be ousted.

(12) Chapter 13 of the Code deals with jursidiction of the Criminal Courts in inquries and trials. Section 177 incorporates the ordinary/general rule of jurisdiction, as stated above, while the Sections following it, viz., 178 to 182 embody the exceptions. The general principle of law is that all crime is local and the jurisdiction to try a person for an offence depends upon the crime having been committed within the area of such jurisdiction. The word 'ordinarilly 'has been construed to mean 'except where provided otherwise in the code' (See Narumal v. State of Bombay, A.I.R. 1960 Sg 1329. That is why the other Sections viz. 178 to 182 constitute exceptions to the general rule. For obvious reasons, the argument of the learned counsel for the petitioner that Section 182 being a more specific provision will govern the Venue of trial in cases of cheating leading to delivery of goods and as such it will exclued the general principle of jurisdiction is devoid of any merit. On a mere juxta-position of the two Sections, 177 and 182 of the Code, it is manifest that the latter provision supplements and does not supplant the general rule. It is intended to provide for the difficulty that may sometime arise in proscuting a person in a Court within whose territorial jurisdiction deception has been allegedly practiced for want of requisite proof. Thus it is an enabling Section and provides alternative venue of trial so as to ensure that the accused decs not get away with the ill-gotten fruits of crime on some technical ground or for want of adequate proof of its commission in a particular area of jurisdiction.

(13) It is a well settled rule of interpretation that the provisions of a statute should be so read as to harmonise with one another and the provisions of one Section cannot be used to defeat those of another unless it is impossible to effect reconciliation between them. Considering the true meaning of the words or expressions used by the legislature the Court must have regard to the main object and scope of the statute to be read in its entirety. In 'Craies on Statute Law' 7th Edition, the following exposition of the relevant rule of constitution is found at page 98 :

'IT is the most natural and genuine exposition of a statute to construe one part of a Statute by another part of the same statute, for that best expressed the meaning of the members.........and this exposition is ex visceribus actus.'' But this rule of construction is never allowed to alter the meaning of what is of what is of itself clear and explicit; it is only when, as the court said in Palmer's case, (1785) 1 Lea G.G 355 'any part of an Act of Parliament is penned obicurely and when other passages can elucidate that obscurity, that recourse ought to be had to such context for that purpose' ; for as the judges said in the House of Lords in Warburton v. Loveland, (1832) D. Clau 480, the rule of construction can require that when the words of one part of a statute convey a clear meaning it shall be necessary to introduce another part of one part of a Statute convey a clear meaning it shall be necessary to introduce another part of a Statute for the purpose of controlling or diminishing the efficacy of the first part.' 'It is not the duty of a Court of Law', said Solwyn L.J. in Smith's case, (1869) L.R. 4 Ch. App. 611, 'to be astute to find out ways in which the object of an Act of the legislature may be defeated.'

(14) The maxim 'expression unius est exclusionalterius' (express mention of one thing implies the exclusion of another) is not one of universal application. It is not enough that the express and tacit are merely incongruous ; it must be clear that they cannot reasonably be intended to coexist.

(15) It is thus the duty of the Court to give a harmonious construction to both the provisions so that full effect may be given to both without one excluding the other, there being no seeming conflict or repugnancy in the two. Hence, when Section 177 conveys a clear meaning it is not permissible to construe the same with reference to another Section i.e. 182 for the purpose of controlling or diminishing the efficacy of the former. More so, when there is nothing in the language of the latter which will control or impinge upon the effect of Section 177. Surely, it is not intended to abrogate the general rule of jurisdiction with regard to the trial of criminal offences and it is merely supplemental thereto.

(16) It may be pertinent to notice that the Law Commission in its 41st Report has remarked thus :

'ASthe word 'ordinarily' used in S. 177 of the Code indicates, the general rule laid down in this Section is neither exclusive nor paromptory. In the subsequent sections alternative venues for enquiry and trial are provided for in regard to certain types of offences. Barring S. 178 which empowers the State Government to supersede the normal rule in regard to certain sessions trials, the other provisions supplement that rule and either authorise certain venues different from the place of commission of offence even where it is known or can be determined, or authorise different venues where the place of commission of offence is prima facie not determinabie.'

(17) Again after analysing the different views on the controversy with regard to the venue for the trial of offence of cheating, the Gommission recommended in para 15 : 36 that :

'ONthe strength of this analysis it might be argued in comparable cases that no part of the offence of cheating and dishonestly inducing delivery of property takes place at the accused person's end. The application of S. 179 (now S. 178) or S. 182 (now S. 179) might be regarded as of doubtful validity. There should, however, to of no objection in principle, to the person accused of cheating from a distance being triable for the. offence, not only at the place where, his victim was deceived and/or made to part with properly, but also at the place where the accused has been carrying on his dishonest practices and reaping the benefits.'

(18) Hence, there is no escape from the conclusion that the Court at the place where deception is practiced and inducement is made to the person cheated to deliver property will have jurisdiction to try the offence and the Courts mentioned in Section 182 will also be competent to try the said offence in addition to such a court.

(19) It is trite that the jurisdiction is primarily to be decided on the allegations in the complaint. Hence, the Court at Delhi will be competent to try this offence.

(20) To sum up, there is no merit in this revision petition. It is accordingly dismissed. The petitioner is directed to appear in the Court concerned on 27th April, 1982.


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