A mere breach of contract does not constitute a criminal offense under IPC Sections 406 and 420; criminal proceedings should not be initiated without evidence of fraudulent intent.

JUDGMENT :

Heard learned counsel for the petitioner, learned counsel appearing on behalf of the respondent State as well as the learned counsel appearing on behalf of the respondent no.2.

2. This petition has been filed for quashing of the entire criminal proceeding including the order taking cognizance dated 06.03.2024 in connection with C.P.Case No.1499 of 2023 pending in the court of learned Civil Judge (Sr.Division) cum-Judicial Magistrate, Bokaro.

3. The complaint case has been filed alleging therein that accused person no.1 issued two different work orders to the complainant being purchase order no.3300004379 dated 24.9.2018 for Rs.8,82,640/- and purchase order no.3300004438 dated 13.10.2018 for Rs.44,84,000/- for doing capital repairs of RHF-1 (Regenerative) and MBF-1 Ranking Dismantling and Reliving in the factory premises of the petitioner at Ginigera Koppal, Karnataka. The Complainant states that he had finished both the works efficiently within stipulated time period. And submitted the bills against the work it had done with regard to two purchase orders having a total bill of Rs.55,66,640/-. It is admitted by the complainant that a sum of Rs.28,83,478//- has been paid to him and it has been claimed that a sum of Rs.24,83,162/- remained due against the aforesaid bills. It is stated by the complainant that the complainant requested the accused petitioner to make payment of the due amount by sending request via mobile phone and e.mail. However, the accused petitioner did not make the payment. It is alleged that when the requests of the complainant was not acted upon he gave a legal notice to the accused person through his lawyer M.K. Srivastava through speed post on 25.3.2023 which was delivered to the accused petitioner on 30.3.2023. Despite issuance of legal notice no payment was made by the accused petitioner. However, the petitioner gave reply to the legal notice on 21.4.2023 through lawyer R.B.Panaghanti refusing the liability of making the payment of dues on several pretexts. Having no other alternative the complainant has filed the present C.P. Case against the petitioner. It is also stated that purported copies of the following papers were enclosed with the complainant: Tax invoice raised by Global Construction upon Hospet Steels Ltd in relation to work orders no.1200002143, 1200002165, 1200001908, 1200002303, 1200002432. Legal Notice dated 25.3.2023 giving to Kalyani Steels Limited, with postage receipts and reports in relation to reply dated 21.4.2023 to legal notice.

4. Mr. Pandey Neeraj Rai, the learned counsel appearing on behalf of the petitioner submits that the complainant has examined two enquiry witnesses and he was also made statement in the solemn affirmation and thereafter the learned court has been pleased to take cognizance under sections 406 and section 420 of the Indian Penal Code and summons have been directed to be issued against the Managing Director who happened to be the petitioner. He submits that the dispute is with regard to non-payment of Rs.24,83,162/-. He submits that the petitioner happened to be the Managing Director of M/s Kalyani Steel Limited and the respondent no.2 was appointed by the said company to discharge the refractory work of the said company and the respondent no.2 happened to be proprietor of the said company. By way of drawing attention of the Court to the solemn affirmation, he submits that in the solemn affirmation itself, respondent no.2 has admitted that a sum of Rs.53,66,640/- was due, however, only Rs.28,83,478/- has been paid and for recovery of the rest of the amount for a sum of Rs.24,83,162/- the case has been lodged. He submits that on the Court’s question also the respondent no.2 has admitted that for recovery of the said amount the case has been lodged. He submits that if such a situation is there, the case, if any made out, that is of civil in nature. He submits that for recovery of the amount the respondent no.2 has not taken any steps and straightway he