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HIGH COURT OF ALLAHABAD
B.K.Sharma
RAJ TILAK JAIN
Versus
STATE OF U P
Decided On : 16 December 2000
Criminal Revision Nos. 50 and 86 of 1990
CRIMINAL REVISION - SUMMONING OF ACCUSED - PRIMA FACIE CASE - OFFENCES UNDER SECTIONS 420, 407, 120-B IPC - CHEATING - CRIMINAL BREACH OF TRUST - CONSPIRACY - TRANSPORT COMPANY - DISHONEST INTENTION - INTEREST CLAUSE IN HUNDI - POLICY OF COMPANY - FINANCIAL POSITION OF BUYER - EVIDENCE - INTENTION TO DEFRAUD - BURDEN OF PROOF - STAGE OF FRAMING OF CHARGE.
Fact of the Case:
The complainant, a sales officer of Star Paper Mills Ltd., Saharanpur, filed a criminal case against the accused, partners of M/s. Kagaz Kendra and M/s. Vijay Kumar Satya Narain, and M/s. Deepak Transport Agency, alleging that they had fraudulently obtained goods worth Rs. 10,53,547 by accepting hundi documents in the bank without any intention to pay the same. The police submitted a final report on which notice was sent to the complainant. He filed a protest petition, alleging that the accused had misappropriated the price of the goods and committed misappropriation and breach of trust. The Chief Judicial Magistrate accepted the final report in respect of the transport company but rejected the same in respect of the other accused and directed their summoning for the offences under Sections 403, 409, and 420 IPC. The accused filed a revision petition against the order, which was allowed by the Sessions Judge. The complainant filed a revision petition against the order of the Sessions Judge, and also filed a revision petition against the order of the Chief Judicial Magistrate accepting the final report in respect of the transport company.
Finding of the Court:
The High Court held that the Chief Judicial Magistrate had erred in accepting the final report in respect of the transport company and in rejecting the complaint in respect of the other accused. The Court found that there was a prima facie case made out for summoning the accused for the offences under Sections 420, 407, and 120-B IPC. The Court also held that the Sessions Judge had erred in allowing the revision petition filed by the accused and in setting aside the order of the Chief Judicial Magistrate summoning the accused. The Court allowed both the revision petitions filed by the complainant and restored the order of the Chief Judicial Magistrate summoning the accused for the offences under Sections 420 and 407 read with Section 120-B IPC. The Court also directed the Chief Judicial Magistrate to reconsider the matter and issue process against the transport company according to law.
Issues: 1. Whether there was a prima facie case made out for summoning the accused for the offences under Sections 420, 407, and 120-B IPC? 2. Whether the Chief Judicial Magistrate erred in accepting the final report in respect of the transport company and in rejecting the complaint in respect of the other accused? 3. Whether the Sessions Judge erred in allowing the revision petition filed by the accused and in setting aside the order of the Chief Judicial Magistrate summoning the accused?
Ratio Decidendi: 1. A prima facie case is made out when there is sufficient material on record to establish a fact or to raise a presumption of truth of facts unless the prosecution allegations are so fantastic that they cannot reasonably be held to be true. 2. The intention of the accused is to be inferred from his subsequent conduct and all the surrounding circumstances. Where there is an averment of fraudulent and dishonest intention and these averments and the constitute factual allegations taken together go to constitute an offence and the material on record discloses sufficient ground to proceed against the accused, the Magistrate cannot decline to issue process. 3. The mere fact that there is a clause in the hundi for payment of interest in case of delay in payment of the price of the consignment to the seller does not mean that there could be no question of cheating in the presence of such a clause.
Final Decision: The High Court allowed both the revision petitions filed by the complainant and restored the order of the Chief Judicial Magistrate summoning the accused for the offences under Sections 420 and 407 read with Section 120-B IPC. The Court also directed the Chief Judicial Magistrate to reconsider the matter and issue process against the transport company according to law.
These are two con nected criminal revisions preferred by the sales officers of Star Paper Mills Ltd. Saharanpur.
2. The facts leading to these revisions are that Raj Tilak Jain, Sales Officer, Star Paper Mills Ltd. , Saharanpur filed a Criminal Case No. 4416 of 1989, before the Chief Judicial Magistrate, Saharanpur against (1) Vijay Kumar Sarawgi son of Satya Narain Sarawgi, Partner of M/s. Kagaz Kendra Bombay, (2) Smt. Kanta Devi Sarawgi, wife of Sri Satya Narain Sarawgi partner of M/s. Kagaz Kendra, Bombay, (3) M/s. Kagaz Kendra, Bombay, (4) M/s. Vijai Kumar Satya Narain, Bom bay and (5) M/s. Deepak Transport Agency Associates, under Sections 407, 420 and 120-B IPC mentioning therein that M/s. Star Paper Mills Ltd. are manufacturers of various varieties of Kraft, writing and printing papers that goods are supplied by the company to the buyer against the terms of payment through DP and DA docu ments, that in case of DA documents the Hundi, Bill and consignee copy of the goods receipt for the goods despatched are sent through bankers for presentation to the buyer for acceptance and payment on due dates mentioned on each Hundi, that in the event of despatch through railways, sometimes the railway receipts are delivered directly to the buyers against assurance of buyer of payment of Hundi on due date in bank to avoid demurrage at destination on account of delay in presen tation of RR through bank, that thus in case of DA documents the buyer, in lieu of cash payment, accepts and signs the hun-dies with assurance of their payment on due dates in the bank and on this assurance obtains the valuable documents including consignee copy of the goods receipt or railway receipt and collects goods from carrier, that they are required to deposit its value in the bank on due dates, that the hundi documents so accepted and signed by the buyers against the receipt of the goods are negotiable Instruments and are considered a valid order of payment by the bankers, that this is an accepted mode of business recognised by the bankers for, extending various credit facilities that the goods are supplied against terms of pay ment through DA documents only where the financial position of the buyer is con sidered sound, that in the first week of August, 1986 and Shri Vijay Kumar Sarawgi son of Sri Satya Narain Sarawgi ap proached the complainant and other sales executive of the Star Paper Mills (hereinafter referred to as the company) at Saharanpur and introduced himself as leading paper merchant of Bombay, that he informed that he was trading in paper in the name of Ms. Kagaz Kendra and M/s. Vijay Kumar Satya Narain both having their business premises at 73, Bajaj Bhawan Nariman Point, Bombay that he represented himself as partner of these firms that the name of other partners were not disclosed by him except that of Smt. Kanta Devi Sarawgi wife of Sri Satya Narain Sarawgi as partner of M/s. Kagaz Kendra, resident of the same place, that Sri Vijay Kumar Sarawgi represented that they shall be purchasing their main re quirement in M/s. Kagaz Kendra and he said firm was having sound financial status and was enjoying good banking facilities and thus they were capable of paying the hundi documents sent by the Star Paper Mills through its bankers on specified dates that they informed the names of their bankers as M/s. Central Bank of India, Bombay, Main Branch Bombay and M/s. Allahabad Bank, Bombay Samachar Marg, Bombay and represented that they had good limits in the said banks that the complainant and other officers of the company felt impressed by his repre sentations and accordingly to supply goods to the said firms on the terms of payment through DA documents payable on specified dates and in pursuance there of sent six consignments for M/s. Kagaz Kendra (details of the
six consignments disclosed in para 6 of the complaint); that out of the above six consignments 5 con signments were dispatched from Saharan pur to Bombay through Railway
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