2000(1) Crimes 179 (SC)
Supreme Court of India
(From Allahabad High Court)
S. Saghir Ahmad and D.P. Wadhwa, JJ.
G. Sagar Suri & Anr. —Appellants
versus
State of U.P. & Ors. —Respondents
Criminal Appeal No. 91 of 2000
(Arising out of SLP (Crl.) No. 1998 of 1999)
Decided on 28-1-2000
Counsel for the Parties :
For the Appellants : Rakesh Dwivedi, Rao Ranjit, R.S. Hedge, Advocates.
For the Respondents : U.R. Lalit, Sr. Advocate, Arjun Bhandari, Arun K. Sinha, T.N. Singh, A.S. Pundir, Rakesh Singh, B.K. Singh, Advocates.

Important Points
1. Filing of application for discharge before the trial Court cannot be a ground to refuse exercise of power by High Court u/s 482 Cr.P.C. to quash FIR/Criminal proceed­ings.
2. Where for realisation of amount due under dishonoured cheque proceedings u/s 138 Negotiable Act had been instituted and thereafter prosecution proceedings u/s 406/420 IPC were launched, prosecution proceed­ings, being to get back amount by browbeating and tyrannizing, was quashed.

Headnote:(i) Code of Criminal Procedure, 1973—Section 482 r/w Section 245 —Inherent powers of High Court—Quashing of Criminal proceed­ings—Filing of application before trial Court for discharge is not a bar to exercise jurisdiction by High Court. (Para 7)

       (ii) Code of Criminal Procedure, 1973—Section 482—Inherent powers of High Court—Quashing of FIR/Criminal proceedings—Complaint under Sections 406/420 against appellants—Allegation that appellant borrowed, as directors of Company, Rs. 50 Lakhs and failed to return same and defrauded complainant—Prior to complaint plaint under Section 138 of Negotiable Instru­ments Act filed which was still pending —No plea of offence under Section 406/420 IPC pleaded therein—No details about fraud committed by appellant stated in complaint u/s 406/420 IPC—No allegation of corrupt practice by any of accused as if they duped complainant Finance Company in parting with amount—Sole purpose of complaint u/s 406/420 is getting loan by browbeating and tyrannizing appellant in criminal proceedings—Complaint to prosecute u/s 406/420 is an abuse of process of law—Prosecution quashed.

       Jurisdiction under Section 482 of the Code has to be exercised with a great care. In exercise of its jurisdiction High Court is not to examine the matter superficially. It is to be seen if a matter, which is essentially of civil nature, has been given a cloak of criminal offence. Criminal proceedings are not a short cut of other remedies available in law. Before issuing process a criminal court has to exercise a great deal of caution. For the accused it is a serious matter. This Court has laid certain principles on the basis of which High Court is to exercise its jurisdiction under Section 482 of the Code. Jurisdiction under this Section has to be exercised to prevent abuse of the process of any court or otherwise to secure the ends of justice. (Para 8)

       In the circumstances of the case in hand conclusion is ines­capable that invoking the jurisdiction of criminal court for allegedly having committed offences under Sections 406/420 IPC by the appellants is certainly an abuse of the process of law. In the counter affidavit filed on behalf of the complainant it is now admitted that none of the two appellants is a director of Ganga Automobiles Ltd. Only in respect of the first appellant it is stated that he is the authorised signatory of that company and that in fact he had signed the cheques which were returned disho­noured. Apart from making the omnibus statement that the first appellant with dishonest intentions and misrepresentations got loan of Rs. 50,00,000/- from the complainant com­pany for Ganga Automobiles Ltd. there is nothing said as to what were those misrepresentations and how the com­plainant company was duped. The only part attributed to the second appellant is that the first appellant along with Ashwani Suri, Managing Director and Mukender Singh, Director approached the com­plainant in June, 1996 and had represented that they and Shalini Suri, Shama Suri (Appellant No. 2), Charanjit Singh and M.L. Kampani were the Directors of Ganga Automobiles Ltd. There is nothing stated in the counter affidavit about the role, if any, played by the second appellant. A com­plaint under Section 138 of the Negotiable Instruments Act has already been filed by the complainant. There is no allegation of any corrupt practice by any of the accused as if they duped the Finance Company in parting with the amount of Rs. 50,00,000/-. As normally understood business of a finance company is to invite deposits, pay interest on that and also to give loans and earn interest. A finance company also advances short term loans. In that case it is essentially a commercial transaction. After first two cheques were dishonoured two cheques were again issued, which again were dishonoured resulting in filing of complaint under Section 138 of the Negotiable Instruments Act. None of the respondents has been able to explain as to why offences under Sections 406/420 IPC were not added in the complaint filed under Section 138 of the Negotiable Instruments Act and why resort was had to filing of a separate First Information Report. Certain motive has been attributed to the investigating officer but we think we need not go into that. There is also no answer as to why investigation against three other directors was still stated to be pending when same role is assigned to all the accused. In the FIR it is Sukhvender Singh, who first approached the complainant, but later it is Mukender Singh. There is no answer as to why there are two different names. As to who are the directors of Ganga Automobiles Ltd. could have been easily found by the complainant after going through the records of Registrar of Companies and also about its status. As noted above, in the subsequent statement by the com­plainant he does not assign any role to the first appellant. The allegation that in the first instance three persons contacted the complainant company, who told the complainant of other Directors with whom the complainant coversed on telephone appears to be rather improbable. The whole attempt of the complainant is evidently to rope in all the mem­bers of the family particularly who are the parents of the Manag­ing Director of Ganga Automobiles Ltd. in the instant criminal case without regard to their role or participation in the alleged offences with a sole purpose of getting the loan due to the Finance Company by browbeating and tyrannizing the appellants of criminal prosecution. A criminal complaint under Section 138 of the Negotiable Instruments Act is already pending against the appellants and other accused. They would suffer the consequences if offence under Section 138 is proved against them. In any case there is no occasion for the complainant to prosecute the appel­lants under Sections 406/420 IPC and in his doing so it is clear­ly an abuse of the process of law and prosecution against the appellants for those offences is liable to be quashed, which we do. (Paras 12 & 13)

       Result : Appeal allowed.