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2005 Supreme(Bom) 750

IN THE HIGH COURT OF BOMBAY
National Small Industries corporation Limited
Versus
Samudra Corporation
Decided on : JUNE 17, 2005

To establish offences under sections 406 or 420 of the Indian Penal Code, the ingredients of the said offences must be clearly established, and a mere breach of contract may not suffice.

Headnote:

Indian Penal Code - Criminal Breach of Trust - Sections 406, 420 - The court discussed the evidence presented by the complainant and the accused, and the judgments of the Supreme Court in similar cases. It concluded that the accused had not committed an offence under sections 406 or 420 of the Indian Penal Code.

Fact of the Case:

The appellant, a government company, filed a private complaint against the respondent for offences under sections 406 and 420 of the Indian Penal Code, alleging breach of a hire purchase agreement and disposal of machines by the accused without consent.

Finding of the Court:

The court found that the evidence did not establish that the accused had disposed of the machines or had an intention to cheat the complainant from the inception. It also noted that a breach of contract does not necessarily constitute an offence under sections 406 or 420 of the Indian Penal Code.

Issues: The issues revolved around whether the accused committed criminal breach of trust and cheating under sections 406 and 420 of the Indian Penal Code, and whether the trial court erred in its findings.

Ratio Decidendi: The court emphasized that to establish offences under sections 406 or 420 of the Indian Penal Code, the ingredients of the said offences must be clearly established, and a mere breach of contract may not suffice.

Final Decision: The court dismissed the criminal appeal, upholding the trial court's order of acquittal.

Judgment

V. M. KANADE, J.

( 1 ) HEARD the learned counsel appearing on behalf of the appellant and the learned Counsel appearing on behalf of the respondents.

( 2 ) THE appellant is the original complainant who has filed a private complaint against respondent No. 1 in the Court of judicial Magistrate, First Class b Court, mapusa, for having committed an offence punishable under sections 406 and 420 of the Indian Penal Code. In the said complaint, process was issued and charge was framed against the respondent/accused. The accused pleaded not guilty to the said charge. The complainant examined 2 witnesses in support of his case and also relied on the Inspection Reports dated 4-2-1992 and 8-4-1992. The trial Court, however, acquitted the accused and dismissed the complaint of the appellant.

( 3 ) THE learned Counsel appearing on behalf of the appellant has submitted that the trial Court has not given cogent reasons for dismissing the complaint of the appellant. He submitted that reliance is placed on a judgment of the trial Court which was relied upon by the accused, ratio of which is not applicable to the present case. He submitted that the trial Court has not properly appreciated the evidence on record and a finding which is recorded by the trial Court is, therefore, perverse. The learned Counsel has taken me to the evidence adduced by the complainant and also to the two Inspection Reports and submitted that the complainant had established that the two machines were delivered to the accused and in the Inspection Reports the accused had admitted the fact of the installation of the machines and had also stated that they were working satisfactorily. He submitted that in the evidence of P. W. 1, D. K. Chaudhary and p. W. 2, Umesh Butani, it was established that without the consent or permission of the complainant the machines were disposed of by the accused and there was, therefore, a clear case of criminal breach of trust made out against the accused. He submitted that further from the evidence which was adduced by the complainant it was clearly established that the accused had dishonestly induced the complainant to deliver the machines and the accused from the inception had an intention of cheating the complainant. In support of the said submission, the learned Counsel on behalf of the appellant relied on the judgments of the supreme Court in the cases of (Trisuns Chemical Industry v. Rajesh Agarwal and others), reported in 1999 (8) S. C. C. 686, (Rajesh bajaj v. State NCT of Delhi and others), reported in 1999 (3) S. C. C. 259 and also on the case of (Alphic Finance Ltd. v. P. Sadasivan and another), reported in 2001 (3) s. C. C. 503. The learned Counsel submitted that the trial Court had clearly erred in coming to the conclusion that the complainant had a civil remedy against the accused and the dispute in question was a civil dispute. He, therefore, submitted that the judgment and order of the trial Court is liable to be set aside and the respondent/accused is liable to be convicted.

( 4 ) THE learned Counsel appearing on behalf of the respondent has opposed the said submissions made on behalf of the appellant. He submitted that the trial Court had given clear and cogent reasons while coming to the conclusion that the complainant had not established his case. He submitted that the trial Court had correctly assessed the evidence and had come to the conclusion that the dispute was of a civil nature and, therefore, criminal case was liable to be dismissed. He submitted that this Court cannot interfere with the order passed by the Judicial Magistrate, First Class, mapusa.

( 5 ) THE complainant in his complaint has stated that the complainant is a Government company having branches all over india and that the complainant had entered into the Hire purchase agreement dated 30-9-1991 with the accused and the complainant had arranged for the supply of two machines to the accused. In the complaint, it was further stated that according t




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