2018 Supreme(Ori) 712

IN THE HIGH COURT OF ORISSA
S. K. SAHOO, J.
CRLA No. 231 Of 2017
An appeal under section 13 of the Odisha Protection of Interests of Depositors (in Financial Establishments) Act, 2011 from the order dated 23.11.2015 passed by the learned Presiding Officer, Designated Court, OPID Act, Cuttack in C.T. Case No. 07 of 2014.
Decided on 27th August, 2018.
Gajanan Property Dealer
and Construction Pvt. Ltd
and Ors. ... Appellants
Versus
State of Orissa & another ... Respondents

Headnote:1. ODISHA PROTECTION OF INTERESTS OF DEPOSITORS (IN FINANCIAL ESTABLISHMENT) ACT, 2011- Sec. 6 - Ingredients of - (i) Default in returning the deposit by any Financial Establishment; or (ii) Default in payment of interest on the deposit or failure to return in any kind by any Financial Establishment; or (iii) Failure to render service by any Financial Establishment for which the deposits have been made - In the event any of the aforesaid aspects is proved, every person responsible for the management of the affairs of the Financial Establishment shall be held guilty - ‘Financial Establishment’ has been defined under section 2(d) of the OPID Act and ‘deposit’ has been defined under section 2(b) of the OPID Act - Word ‘default’ has been used in conjunction with honouring the commitment and therefore, it depends upon the reciprocal promises - The material available on record indicate that after several round of discussions and execution of successive agreements, the job of arranging a sizable extent of land at Bhubaneswar was entrusted to the company by the HAL Housing Committee - Dispute arose when the hope of the company to proceed with the housing project on the acquired land as a part of composite agreement was shattered by the conduct of the committee in making attempt to hand over the housing project to a 3rd party - Therefore, it is difficult to fathom that any commitment made by the company was flouted deliberately or that the company committed any default or failed to render any service for which the deposit was accepted - Ingredients of the offence were found grossly lacking.

        2. ODISHA PROTECTION OF INTERESTS OF DEPOSITORS (IN FINANCIAL ESTABLISHMENT) ACT, 2011 - Sec. 13 - Scope of - Appeal against the order of the Designated Court, refusing to discharge and consequently framing charge against the accused - High Court while exercising its revisional or appellate power, is not denuded of its power under Section 482 of the Code of Criminal Procedure, 1973 - Such power is not trammeled by procedural restrictions and can be exercised suo motu in the interest of justice.

        3. CRIMINAL PROCEDURE CODE, 1973 - Sec. 173 - Police Report- Role of Investigating Officer in the dispensation of criminal justice and maintenance of law and order - Not merely to bolster up a prosecution case with such evidence as may enable the court to record a conviction but to bring out the realunvarnished truth Investigating Officer is to ascertain facts and extract truth from half-truth or garbled version, connecting the chain of events after assessing the nature of dispute between the parties - Police Report is not to be submitted in a mechanical manner - Investigating Officer has acted with malafides and the appellants are harassed on account of arbitrariness - Dispute between the parties is primarily civil in nature which has been given the colour of a criminal case, resulting in abuse of process -Submission of charge sheet is based totally on unfounded assumptions and it has resulted in causing miscarriage of justice - Designated Court has committed palpable error in rejecting the petition for discharge and in framing charges against the appellants - In the interest of justice, the proceeding is quashed.

        4. CRIMINAL PROCEDURE CODE, 1973 - Sec. 239 - Discharge of an accused - Scope and Object of - Opportunity of hearing - Meaning of the word ‘groundless’ - Explained - When there is no ground for presuming that the accused has committed an offence, the charge must be considered as groundless - Opportunity of hearing is to be extended to both prosecution and accused - On consideration of the police report & the documents sent along with it and making such examination of the accused, if any, if the Magistrate considers the charge against the accused as groundless, the accused should be discharged - Court has to see is that the material on record and the facts would be compatible with the innocence of the accused or not - If the unrebutted materials, make out no case whatsoever, the accused should be discharged - Magistrate must record the reasons for so doing -Truth, veracity and effect of the materials are not to be meticulously adjudged at this stage - Likelihood of the accused, establishing his defence cannot be a ground for discharge-No appreciation of evidence is to be undertaken at the stage of consideration of an application for discharge - Object of discharge - To save the accused from unnecessary and prolonged harassment - When the allegations are baseless/without foundation and no prima facie case is made out, the accused is to be discharged.

        5. PENAL CODE, 1860 - Sec. 420 - Ingredients of - (i) deception of a person either by making a false or misleading representation or by dishonest concealment or by any other act or omission; (ii) fraudulent or dishonest inducement of that person to either deliver any property or to consent to the retention thereof by any person or to intentionally induce that person so deceived to do or omit to do anything which he would not do or omit if he were not so deceived; and (iii) such act or omission causing or is likely to cause damage or harm to that person in body, mind, reputation or property - To constitute an offence under Section 420 of the Indian Penal Code, there should not only be cheating, but as a consequence of such cheating, the accused should have dishonestly induced the person deceived (i) to deliver any property to any person, or (ii) to make, alter or destroy wholly or in part a valuable security (or anything signed or sealed and which is capable of being converted into a valuable security) - When attracted - Even if it is the prosecution case that the appellant no.2 failed to discharge the contractual obligations to some extent but mere breach of contract cannot give rise to criminal prosecution for cheating unless fraudulent or dishonest intention is shown right at the beginning of the transaction - Without fraudulent inducement or willful misrepresentation, mere failure to keep up the promise subsequently cannot be a ground to attract the ingredients of the offence of cheating.

        6. CRIMINAL PROCEDURE CODE, 1973 - Sec. 482 - Production of materials by the accused at the stage of framing of charge, before the High Court - It cannot be said as an absolute proposition that under no circumstances can the Court look into the material produced by the defence at the time of framing of the charges, though this should be done in very rare cases i.e. where the defence produces some material which convincingly demonstrates that the whole prosecution case is totally absurd or totally concocted - In rare and exceptional cases, if the accused produces materials before the High Court, which are based on sound, reasonable and indubitable facts and cannot be justifiably refuted by the prosecution and which are of sterling and impeccable quality or on the basis of admitted documents, which would rule out and displace the assertions contained in the charges leveled against him, in order to prevent abuse of process of the Court and to secure the ends of justice, the High Court even at the stage of section 239 of Cr.P.C. can take into account such materials - However, High Court should not enter into appreciation of evidence to verify if the defence plea can be established by the accused or not.

        7. PENAL CODE, 1860 - Sec. 406 - Criminal breach of trust - Ingredients of - (a) a person should have been entrusted with property, or entrusted with dominion over property;(b) that person should dishonestly misappropriate or convert to his own use that property, or dishonestly use or dispose of that property or wilfully suffer any other person to do so;(c) that such misappropriation, conversion, use or disposal should be in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract which the person has made, touching the discharge of such trust - It contains two distinct parts - First part involves the fact of entrustment, wherein an obligation arises in relation to the property over which dominion or control is acquired - Second part deals with misappropriation which should be contrary to the terms of the obligation which is created - To make out a case of criminal breach of trust, it is not sufficient to show that money has been retained by the appellants - It must also be shown that the appellants dishonestly disposed of the same in some way or dishonestly retained the same - Mere fact that the appellants did not pay the money to the informant does not amount to criminal breach of trust - Much prior to the lodging of the F.I.R., the appellant had approached the competent Civil Court - Whether there is any excess payment of money to the appellant no.2 can be better adjudicated by the Civil Court, by giving due opportunity of hearing to the respective sides - In the backdrop of civil dispute between the parties, mere fact that the appellant no.2 did not refund the excess money which he allegedly received from the informant, does not amount to criminal breach of trust - In the factual scenario, the ingredients of offence under Section 406 of the Indian Penal Code are not attracted.

        8. PENAL CODE, 1860 - Secs. 467 & 468 - Basic ingredients - (i) the document in question is forged; (ii) the accused forged it and (iii) the document is one of the kinds enumerated under Section 467 - Section 468 of the Indian Penal Code applies to those cases, where forgery has been committed for the purpose of cheating - If it is proved that the purpose of the offender in committing the ‘forgery’ is to obtain property dishonestly or if the guilty purpose comes within the definition of ‘cheating’ as defined under Section 415 of the Indian Penal Code then his act would be punishable under Section 468 of the Indian Penal Code - For both these offences, the very first thing which is required to be proved is that a ‘forgery’ as defined under Sections 463 and 464 of the Indian Penal Code have been committed - Transfer of land recorded under the Kissam ‘Chhota jungle’ was within the knowledge of both the parties and the requisite mensrea of forgery is hopelessly found to be absent and it cannot be said any fraud has been perpetuated in the alienation or that the execution of the sale deed comes within ‘making a false document’ as defined under Section 464 - In the factual scenario, the ingredients of offence under Sections 467 and 468 were found not attracted.

        9. PENAL CODE, 1860 - Sec. 120-B - Ingredients of - Criminal conspiracy consists of (a) an object to be accomplished, (b) a plan or scheme embodying means to accomplish that object, (c) an agreement or understanding between two or more of the accused persons whereby they become definitely committed to co-operate for the accomplishment of the object by the means embodied in the agreement, or by any effectual means, (d) in the jurisdiction where the statute required an overt act - Essence of a criminal conspiracy is the unlawful combination and ordinarily the offence is complete when there is such combination - Law making conspiracy a crime is designed to curb immoderate power to do mischief which is gained by a combination of the means - The encouragement and support which co-conspirators give to one another rendering enterprise possible which, if left to individual effort, would have been impossible, furnish the ground for visiting conspirators and abettors with condign punishment-Conspiracy is held to be continued and renewed as to all its members wherever and whenever any number of the conspiracy acts are committed - Necessarily, no overt act need be done in furtherance of the conspiracy, and that the object of the combination need not be accomplished - For establishing the offence, the prosecution need not necessarily prove that the perpetrators expressly agree to do or cause to be done illegal act; the agreement may be proved by necessary implication - Offence of criminal conspiracy has its foundation in an agreement to commit an offence - A conspiracy consists not merely in the intention of two or more, but in the agreement of two or more to do an unlawful act by unlawful means - No iota of material in the Police Report to indicate that there was any criminal conspiracy between the appellants for doing an unlawful act by unlawful means rather the appellant no.2 on behalf of the company lawfully entered into a contract with the HAL Housing Committee and did his best in acquiring the lands and registering the lands in the name of the company in a lawful manner - Ingredients of offence under section 120-B of the Indian Penal Code were found not attracted.

        10. CRIMINAL PROCEDURE CODE, 1973 - Sec. 482 - Quashing of proceeding - Dispute between the parties is primarily of civil in nature, which has been given the colour of a criminal case, resulting in abuse of process - In the interest of justice, proceeding pending before the learned Presiding Officer, Designated Court under the OPID Act, 2011 is quashed.