When a dispute arises from a partnership agreement and the agreement has been terminated, the dispute should be resolved through civil proceedings. Criminal proceedings should not be initiated without following the procedure for settling accounts in a partnership agreement.

JUDGMENT :

Heard Mr. Nilesh Kumar, learned counsel for the petitioner, Mr. Santosh Kr. Shukla, learned counsel for the State and Mr. Aashish Kumar, learned counsel for the O.P. No. 2.

2. This petition has been filed for quashing of entire criminal proceeding including order taking cognizance dated 21.09.2011 passed in Complaint Case No. 538 of 2011, pending in the Court of learned Judicial Magistrate, Ranchi.

3. The complaint petition has been filed alleging therein that the complainant/O.P. No. 2 is the Managing Director of M/s Makan Developers (I) Pvt. Ltd., a company incorporated under the Companies Act, 1956 having its registered office at Patna Super Market, Fraser Road, Patna-800001. It deals in construction-cum development work in Bihar as well as in Jharkhand.

That on the inducement of accused No.1 who made many specious offers to the complainant, he started construction and building works in the year 2008 at Ranchi. As the Complainant needed an office at Ranchi, accused No.2 offered a house for office purpose, which he fully furnished with costly items computers, A.C. and fittings etc., and on the request of accused No. 1, he was made Incharge of the office and work site as well. He spent about Rs.3.50 Lakhs in furnishing the office. Before opening the office as a Memorandum of lease was executed by accused No.2 on 15.9.2008 in favour of the complainant's company.

That in the above memorandum, it was clearly agreed to by the parties that the shop room (office) shall be on a monthly rent of Rs. .8000/- per month belonging to accused No. 2. The plan of the Company was to construct two block A and B under the name and style of R.P. Singh Enclave, each comprising of 12 flats and 10 flats of Block No. A was to be handed over to Majan Construction and Dr. Amar, who were land owners.

That on 15.12.2007, both the accused persons contacted the complainant at the site, when they induced him by saying that they shall look after the works and that accused No.1 would be authorised and empowered to sign" any Agreement, issue receipts and receive payments" on behalf of the Complainant. He also undertook to maintain the Books of Accounts, which the complainant shall have the right to verify it every three months. The accused no. 1 further told the complement that the net profit, after meeting the cost of constructions and administrators expenses, shall be divided as shares of the parties.

It was further stated by accused so.1 that the Complainant shall have 75% of the share of total net profit and accused no.1 shall have 25% of it. The complaint was totally taken by the words of accused persons and he agreed to the proposal and accordingly, accused to.1 began to oversee the construction work and accused to.2 to look after. Accordingly the construction work was started in presence of the Complainant in the month of June, 2008.

After six months, the accused persons surreptitiously started their own firm under the name and style as “M/s. Choudhary Cement at Ranchi. Accused No.1 opened an account in the name of his firm in AXIS Bank Ltd., vide A/C No. 1060102 000018692, The accused no. 1 thereafter, used to demand cheques from the complainant in the name of M/s. Choudhary Cement, Believing him, the complainant used to send the cheques as asked by accused No.1. It continued till August, 2009, all to the tune of Rs.18.00 lakhs (approx.).The complainant, in the meantime began to get reports that the accused persons were committing fraud on him. Immediately, he came to Ranchi in the last week of August, 2009, where he was shocked to learn that he was being cheated by the accused persons. He also came to learn that the accused persons had handed over three flats to his brother Santosh Kumar, sister Anmola Choudhary and one Pankaj Kumar without his consent. Accused No.1 gave them the flats without receiving any consideration amount in favour of Complainants firm, all worth Rs.50 lacks when it was pointed out, they began to give lame excuses.

That great