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SUPREME COURT OF INDIA
B.R. Gavai, Rajesh Bindal, Sandeep Mehta, JJ.
A.M. Mohan – Appellant
Versus
The State Represented by Sho and Another – Respondents
Criminal Appeal No. 1716 of 2024 (Arising out of SLP(Criminal) No. 9598 of 2022)
Decided On : 20-03-2024
(A) Indian Penal Code, 1860 – Sections 420/34 – Criminal Procedure Code, 1973 – Section 482 – Cheating – Common intention – Gold chit business – Accused persons swindled all amounts and cheated complainant – For attracting provision of Section 420 of IPC, FIR/complaint must show that ingredients of Section 415 of IPC are made out and person cheated must have been dishonestly induced to deliver property to any person; or to make, alter or destroy valuable security or anything signed or sealed and capable of being converted into valuable security – Only allegation against present appellant is that accused No. 1 executed GPA in favour of complainant in respect of land which is purchased from present appellant – No role of inducement at all has been attributed to present appellant – There was no transaction of any nature directly between appellant and complainant – FIR or charge-sheet, even if taken at its face value, does not disclose ingredients to attract provision of Section 420 of IPC qua appellant – Dishonest inducement is sine qua non to attract provisions of Sections 415 and 420 of IPC – Continuation of criminal proceedings against present appellant would be nothing else but amount to abuse of process of law resulting in miscarriage of justice – FIR and consequential charge-sheet filed against present appellant shall stand quashed and set aside. (Paras 13, 17, 19 and 24)
(B) Criminal Procedure Code, 1973 – Sections 250 and 482 – False criminal cases – Any effort to settle civil disputes and claims which do not involve any criminal offence, by applying pressure through criminal prosecution should be deprecated and discouraged – Though 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 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. (Para 10)
Facts of the case:
High Court rejected the petition filed by the present appellant under Section 482 of Code of Criminal Procedure, 1973 to call for the records and to quash First Information Report registered in connection with the offence punishable under Section 420 read with 34 of the Indian Penal Code, 1860.
Findings of Court:
Order of the High Court dated 15th July 2022 in Criminal O.P. No.20716 of 2020 and Criminal M.P. No. 8763 of 2020 is quashed and set aside.
Result : Appeal allowed.
Key Points: - Dishonest inducement is a sine qua non to attract the provisions of Sections 415 and 420 of the IPC (!) (!) . - For an offence under Section 420 of the IPC, the FIR or complaint must show that the ingredients of Section 415 are met, specifically that the person cheated was dishonestly induced to deliver property or alter/destroy valuable security (!) (!) . - The High Court has the power under Section 482 of the Cr.P.C. to quash criminal proceedings even after a charge-sheet has been filed if the allegations do not prima facie disclose the commission of an offence (!) (!) . - Efforts to settle civil disputes by applying pressure through criminal prosecution should be deprecated and discouraged (!) (!) . - In the present case, no role of inducement was attributed to the appellant, and there was no direct transaction between the appellant and the complainant (!) (!) . - The FIR and consequential charge-sheet against the appellant were quashed because they did not disclose the ingredients necessary to attract Section 420 of the IPC (!) (!) (!) . - The Supreme Court set aside the High Court's order dated 15th July 2022, which had previously rejected the appellant's petition to quash the FIR (!) (!) .
JUDGMENT :
B.R. GAVAI, J.
1. Leave granted.
2. The present appeal challenges the order dated 15th July 2022 passed by the learned Single Judge of the High Court of Judicature at Madras in Criminal O.P. No. 20716 of 2020 and Crl. M.P. No. 8763 of 2020, whereby the High Court rejected the petition filed by the present appellant under Section 482 of the Code of Criminal Procedure, 1973 (“Cr.P.C.” for short), to call for the records and to quash the First Information Report (“FIR” for short) registered as Crime No. 21 of 2020, on the file of SHO, District Crime Branch, Kancheepuram, in connection with the offence punishable under Section 420 read with 34 of the Indian Penal Code, 1860 (“IPC” for short).
FACTS
3. Shorn of details, the facts leading to the present appeal are as under:
3.1 The case of the prosecution is that, during the year 2016, accused No. 2-Suresh Prathaban, being a college friend, approached the complainant Karthick Krishnamurthy for some help to clear his hand loan. The accused No. 2 further told that he had business with accused No. 1- Lakshmanan, who is running a hotel and also doing real estate business. Upon the insistence of accused No. 2, the complainant had agreed to extend financial help to accused No. 1 to the tune of Rs.1,60,00,000/- for the business project(s) at Oragadam and around Kancheepuram District with condition to repay the same within 20 months with 100% profit.
3.2 Accordingly, the complainant transferred a sum of Rs.49,25,000/- on 18th March 2016, Rs.20,01,000/- on 31st May 2016, Rs.36,25,000/- on 13th June 2016, Rs.30,24,166/- on 8th July 2016 through RTGS and Rs. 24,25,834/- in cash to accused Nos. 1 and 2, totalling to the tune of Rs.1,60,01,000/- (though mentioned in complaint as Rs.1,60,00,000/-). To secure the same, accused No. 1 had executed a registered simple mortgage deed dated 18th March 2016 in favour of the complainant relating to 100 plots at Sumangali Village, Thiruvannamalai District, registered vide document No.768 of 2016 for Rs.1,00,00,000/-.
3.3 Thereafter, at the insistence of accused Nos. 1 and 2, the complainant entered into an unregistered memorandum of understanding and paid a sum of Rs.1,50,00,000/- and a further sum of Rs.50,00,000/- by RTGS and cheque to accused No. 1’s bank. In the said amount, the complainant directly transferred a sum of Rs.20,00,000/- in favour of the present appellant-A.M. Mohan (accused No.3). Further, accused No.1 also transferred a sum of Rs.1,80,00,000/- to the present appellant for the purchase of the land admeasuring 9.80 acres situated at Chittoor Village, Sriperumbudur Taluk. To secure the said payment of Rs.2,00,00,000/- with returns of Rs.10,00,00,000/-, accused No. 1 executed a registered deed of General Power of Attorney (“GPA” for short) dated 3rd February 2017, in favour of the complainant, vide document No. 3733/2017, in respect of the above said land and also executed a registered sale deed relating to the land admeasuring 2.52 acres situated at Vellarai Village, Kancheepuram District vide document No.386/2017 dated 9th February 2017 in favour of the complainant.
3.4 The accused No. 1 also executed a mortgage deed for land admeasuring 2.14 acres at Sunguvarchatram Village (though mentioned in the complaint as ‘a registered Agreement to Sell land admeasuring 1.64½ acres’) in favour of the complainant registered vide document No.373/2017 dated 27th February 2017. Thereafter, accused Nos. 1 and 2 had received an amount of Rs.49,85,500/- and executed unregistered loan agreement dated 5th March 2017, in favour of the complainant and agreed to repay with interest quantified at Rs.60,000/- per month. For repayment of the said amount along with interest, accused No. 1 had given a cheque for Rs.58,50,000/- and the same was returned dishonoured due to insufficient funds.
3.5 Apart from all these transactions, on insistence of accused Nos. 1 and 2, the complainant joined in the “gold chit business” conducted by accused No. 1 and paid a sum of Rs
Criminal proceedings cannot be used as a shortcut for civil remedies, and the ingredients of the offence of cheating must be prima facie discernible for the continuation of criminal proceedings.
The Court held that the inherent power of the High Court under Section 482 CrPC can be exercised to quash a criminal proceeding if it is found that the proceeding is an abuse of the process of the Co....
Criminal proceedings cannot proceed where allegations only constitute a civil dispute without intent to cheat.
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