2010 Supreme(Pat) 1032
PATNA HIGH COURT
Shiva Kirti Singh, J.
Nawal Kishore Prasad Singh
Versus
State Of Bihar
Criminal Miscellaneous No. 18267 of 1999 18631 of 1999 18859 of 1999
Decided On : April 29, 2010
The judgment establishes that a dispute arising from a breach of contract may not necessarily constitute criminal offenses of breach of trust or cheating, and should be addressed through civil liability.
Headnote:
Quashing - Criminal Prosecution - Breach of Contract
Fact of the Case:
The petitioners sought to quash the criminal prosecution against them for offenses under sections 420, 406 of the Indian Penal Code, relating to a complaint by a contractor claiming breach of agreement and loss due to contract work being completed departmentally.
Finding of the Court:
The court found that the facts alleged in the complaint petition did not make out any criminal offense of breach of trust or cheating against the petitioners, as the dispute appeared to be a breach of contract rather than a criminal act.
Issues: The main issue was whether the allegations in the complaint petition constituted criminal offenses of breach of trust or cheating against the petitioners.
Ratio Decidendi: The court analyzed the substance of the complaint and concluded that the dispute appeared to be a breach of contract, and the allegations did not establish criminal intent or dishonesty from the inception of the contract.
Final Decision: The court allowed all the applications and quashed the entire criminal prosecution against the petitioners, as well as the order of cognizance.
1. Heard learned counsel for the petitioners in all the three quashing applications and also learned counsel for the State. Notice has been served on the Opposite party No.2, the Complainant and he has appeared through counsels in two of the cases. The names of the counsels appear in the daily cause list but they have chosen not to appear and contest these applications.
2. Prayer in all these applications filed under section 482 of the Code of Criminal Procedure is for quashing the entire criminal prosecution against the petitioners in a complaint case bearing No. C 658/97 pending before Chief Judicial Magistrate, Bhagalpur relating to offences under sections 420, 406 of the Indian penal Code and also for quashing of order of cognizance dated 30-9-1997.
3. On behalf of the petitioners, it has been submitted that a perusal of the entire complaint petition would show that the complainant claims to be a contractor with whom the four petitioners as Engineers and employees under the Bihar State Agriculture marketing Board entered into an agreement for execution of a civil work and pursuant to such agreement dated 6-9-88 the complainant begun the contract work and was paid an amount of Rs.1, 75, 234/- but thereafter his work was neither measured nor his outstanding bills were paid and this was followed by the accused persons getting the contract work completed departmentally causing loss to the complainant-contractor to the tune of rs.1, 94, 320/- for which he gave notice but in vain.
4. It has been submitted on behalf of the petitioners that the allegations in the complaint petition disclose at best a breach of agreement executed between the parties due to subsequent dispute on account of a boundary wall being constructed at a different point than the specified place by the Marketing Board and hence for such breach of contract, only a civil liability could have been maintained against the petitioners or the Marketing board and no criminal offence is made out on the basis of allegations noticed above.
5. Learned counsel for the State has submitted that the complainant has mentioned in paragraph 1 of the complaint petition that he was assured and convinced by an agreement dated 6-9-88 that on performance of his work he would be paid the agreed amount and since that was not done the complainant is justified in alleging that he has been cheated by the accused persons.
6. No doubt the word "assurance" has been mentioned by the complainant in paragraph 1 but such assurance was not a verbal assurance and it was duly entered by way of formal agreement. Clearly, there was no dishonest intention at the beginning of transaction because the complainant has admitted that in the beginning his work was supervised and measured and he was paid on account a huge amount of Rs.1.7 lacs and odd. Admittedly, there was a dispute over situation of the boundary wall and the complainant has admitted that he shifted the boundary wall at a considerable distance on the dictates of Sub-divisional Officer/ Chairman, Bazar samiti, Pakur. Whether the dispute was justified or not is not the subject matter of enquiry for the purpose of considering the present application of the petitioners under section 482 of the Code of Criminal Procedure. The issue is whether they were working with dishonest intention from the very inception of the contract or not. The facts mentioned in the complaint petition show that differences arose at a later stage and on account of such differences the contractor was not allowed to work or was not paid further money. In paragraph 10 the complainant has made a grievance that the accused persons ought to have stopped the work of the complainant or cancelled the agreement before getting the work done by the department causing loss to the complainant. This may be a ground for claiming damages through properly constituted civil suit before a competent civil court but on such allegation it is difficult to hold that any criminal offence