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Andhra Pradesh High Court
Judges : M.JAGANADHA RAO
P.Eswara Reddy - Appellant
Versus
State OF A.P. - Respondent
Decided On : 06-26-85
CRIMINAL LAW - CHEATING - S. 415, 420, I. P. C. - DISHONOURED CHEQUE - OFFENCE - INGREDIENTS - INTERPRETATION - APPLICATION.
Fact of the Case:
The petitioner was charged with cheating under S. 420, I. P. C. for issuing a dishonoured cheque for Rs. 38,500.00 to the complainant, a seller of vehicles, as payment for a vehicle purchased earlier. The petitioner had paid a 10% down payment and taken possession of the vehicle in March 1983. Subsequently, he obtained an F form and sale letter from the complainant, representing that he could not register the vehicle or arrange for finance without them. The cheque was dishonoured when presented for payment.
Finding of the Court:
The court held that no offence under S. 415 or S. 420, I. P. C. was made out. The court relied on the following principles: 1. Once a debt is incurred and property is parted with without any dishonest intention, the subsequent issuance of a dishonoured cheque does not amount to cheating under S. 420, I. P. C. 2. The evasion or deferment of payment of an existing debt is not an offence under S. 415, I. P. C. unless it causes damage or harm to the complainant's body, mind, reputation, or property. 3. The mere taking of a cheque by the complainant for encashment, even if it is dishonoured, does not amount to damage to the complainant's body, mind, reputation, or property under the Indian law.
Issues: 1. Whether the issuance of a dishonoured cheque for an antecedent debt constitutes cheating under S. 420, I. P. C.? 2. Whether the evasion or deferment of payment of an existing debt is an offence under S. 415, I. P. C.? 3. Whether the mere taking of a cheque by the complainant for encashment, even if it is dishonoured, amounts to damage to the complainant's body, mind, reputation, or property under the Indian law?
Ratio Decidendi: 1. The court held that the issuance of a dishonoured cheque for an antecedent debt does not constitute cheating under S. 420, I. P. C., as there was no dishonest intention at the time the debt was incurred and the property was parted with. 2. The court held that the evasion or deferment of payment of an existing debt is not an offence under S. 415, I. P. C., unless it causes damage or harm to the complainant's body, mind, reputation, or property. The court found that the mere taking of a cheque by the complainant for encashment, even if it is dishonoured, does not amount to damage to the complainant's body, mind, reputation, or property under the Indian law.
Final Decision: The court allowed the petition and quashed the complaint and all further proceedings.
( 1 ) THIS is an application under S. 482, Cr. P. C. for quashing the proceedings in C. C. No. 74 of 1984 on the file of the XI Metropolitan Magistrate, Secunderabad. The petitioner has been charge-sheeted under S. 420, I. P. C. on the following facts.
( 2 ) IT is alleged that the petitioner came to the complainants shop (some time in February, 1983) and he agreed to purchase a Ashok Leyland Vehicle. As per the terms of the contract, the petitioner-accused paid a sum of Rs. 26,462. 30 Ps. being 10% of the total cost of the vehicle and the petitioner promised to pay balance of 90% of the consideration later on. The petitioner was given possession of the vehicle in March 1983. Subsequently after three months, the petitioner is alleged to have come to the seller and represented that due to non-availability of F form and the sale-letter from the sellers, the petitioner was unable to register the vehicle and that he could not arrange finance from the Bank. It is stated that on good faith and as a special case, the sellers issued F form and the sale-letter to the petitioner. It is then stated that on 9th of September 1983, the petitioner gave a cheque bearing No. 901535 for an amount of Rs. 38,500. 00 and that when the cheque was presented, it was dishonoured. It is further stated that during the course of investigation, L. Ws. 1 to 7 were examined and their statements recorded and that the investigation disclosed that the accused falsely represented to the complainant and obtained F form and sale-letter from him and also gave a cheque knowing that there was no balance in his account. Thus, it is stated that the accused committed an offence punishable under S. 420, I. P. C.
( 3 ) IN this application, it is contended by the learned counsel for the accused-petitioner Sri C. Padmanabha Reddy that on a reading of the charge sheet, no offence under S. 420, I. P. C. is made out. He has relied upon certain rulings of various Courts to show that once a debt is incurred or property is parted with in favour of the accused and no dishonest intention is alleged at that stage merely because a cheque was subsequently issued and the same was dishonoured, does not amount to cheating either under S. 420 or under S. 415 I. P. C.
( 4 ) ON the other hand, it is contended by the learned Addl. Public Prosecutor Sri Y. Bhaskara Rao that the ingredients of S. 420 as well as S. 415, I. P. C. are satisfied. According to him, even though the property was parted with earlier and a cheque was issued later and then the same dishonoured an offence under S. 420, I. P. C. is made out. In any event, according to him, eventhough on 9-9-1983, no property was parted with by the sellers, still an offence under S. 415, I. P. C. is made out inasmuch as the seller had to take steps to have the cheque encashed and that action of the sellers would come within that meaning of the words "to do or omit to do anything which he would not do or omit if he were not so deceived" and that had caused damage or harm in the mind of the sellers and that therefore, at any rate, an offence under S. 415, I. P. C. is made out.
( 5 ) THE allegations can be divided into three parts : (a) The first stage is when on 7-2-1983, the petitioner paid a sum of Rs. 26,462-30 being 10% of the sale consideration and when a month thereafter the petitioner obtained possession of the vehicle. (b) The second stage is when the petitioner is said to have come to the sellers in May or June, 1983 represented that due to the non-availability of F-form and sale letter, he was unable to register the vehicle and could not arrange finance from the Bank and the sellers, in good faith as a special case, issued F form and sale letter to the accused. (c) The third stage is when on 9-9-83, the sellers received a cheque for Rs. 38,500. 00 and when the cheque was presented, it was dishonoured.
( 6 ) THE question for consideration is whether at any of these three stages or all of them, an offence under S
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