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2011 Supreme(Bom) 1161

Bombay High Court
A. R. JOSHI, A. H. JOSHI, JJ.
Dattaprasad Ramvilas Lakhotia
Vs.
State of Maharashtra
Decided On : 27/9/2011

Headnote:INDIAN PENAL CODE, 1860 - Sections 406 and 420 - Cheating.

       Since alleged suppression of fact of existence of third partner by accused, partners of registered partnership firm, would not amount to any suppression hence plea of cheating cannot be raised by complainant.

       Indian Penal Code, 1860 - Sections 406 and 420 - Offence of criminal breach of trust and cheating. Where complaint against appellants not disclosed any element of cheating and ingredients of Sections 406 and 420, IPC were missing therefore complaint against appellants quashed.

JUDGMENT :

1. Rule. Rule made returnable forthwith, and heard finally, by consent.

2. This Application is for quashing complaint dated 17.7.2010 i.e. Crime No. I-277/2010 registered with Kranti Chowk Police Station, Aurangabad, for offences punishable under Sections 406 and 420 of the Indian Penal Code. The copy of complaint is at page 16.

3. Learned Advocate for the petitioner has argued in support of the application. The points pressed by him, are summarized as follows:-

(i) The dispute/subject-matter of the contract is of purely civil nature.

(ii) There is no element of cheating in the initial stage of the promise or representation.

(iii) When a party fails to perform promise on his/her part, other side elects to treat it as a breach of promise, in no case, treating it to be a case of breach, amounts to cheating.

(iv) Even upon accepting every word and sentence contained in the complaint to be true, still no offence is made out.

4. The learned Advocate for respondent No.2-complainant has relied on following judgments.

(i) Smt. Chand Dhawan v. Jawahar Lal AIR 1992 SC 1379

(ii) M/s Medchl Chemicals and Pharma Pvt. Ltd. vs. M/s Biological ER. Ltd. AIR 2000 SC 1869.

(iii) M. Krishnan v. Vijay Singh AIR 2001 SC 3014.

(iv) Kamaladevi Agarwal v. State of W.B.AIR 2001 SC 3846. These judgments are relied on, to urge that when the contents of the complaint describe the commission of offence, whether those are true and would be scrutinised at the time of trial. Therefore, worthiness thereof is not a matter to be seen while scrutinizing the worthiness of the complaint for investigation.

5. The substance of the grievance of the complainant can be described in short, as follows:-

(i) The applicants are partners of Messrs Bhalchandra Packeging Industries.

(ii) They agreed to sell the business and assets of partnership firm to the complainant, for total consideration of ` 37,50,000/=.

(iii) Out of agreed amount, a sum of 5,00,000/= was paid as advance/ earnest money. Amount of 7,00,000/- was to be paid on getting loan liability transferred in the name of buyer.

(iv) According to the complainant, the bank did not sanction the loan, as it had revealed during scrutiny of documents by the bank that there was third partner in the said partnership firm, who was not signatory to the agreement to sell.

(v) Applicants have sold out the assets of the firm to another party, falsely alleging failure to perform the promise in due time by the complainant.

(vi) According to the complainant, the acts of applicants of suppression of fact of existence of third partner and sale of the property to another person amount to commission of offence of cheating, and hence, the complaint for offences under Sections 406 and 420 of the Indian Penal Code, was filed, and was registered as Crime No.I-277/2010 at Kranti Chowk Police Station, Aurangabad.

6. Learned Advocate for the respondent has opposed the application, contending that :-

(a) The contents of the complaint adequately describe the commission of offences

(b) There existed element of cheating, as the accused persons had suppressed the fact that partnership was composed of three partners.

(c) Cause of complainant's failure to perform the part is due to suppression by the accused.

(d) Element of cheating existed at the very threshold.

(e) The petition deserves to be dismissed.

7. We have perused the complaint. It is not in dispute that M/s Bhalchandra Packeging Industries is a registered partnership firm. Being a registered firm, constitution thereof is a matter governed by partnership deed, and copy thereof is lodged with the Registrar of Firms, and names of partners are to be recorded in the Register-to be maintained by him.

8. It is not the plea of complainant that the firm is not registered.

9. Respondent-complainant's contention that the applicants had suppressed existence of third partner in the firm, is thus a matter relating to a fact and which is a matter of record open to public for inspection and supply of copies, b









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