By Adv. R. S. Agrawal 

 

IN THE judgement of the case – Deepak Gaba and Others v. State of Uttar Pradesh, delivered on January 2, 2023, Justice Sanjiv Khanna and Justice J. K. Maheshwari, at the Supreme Court , have ruled that when the allegations in the complaint are so absurd or inherently improbable, on the basis of which no prudent person can ever reach a just conclusion that there is sufficient wrong for proceeding against the accused, summons should not be issued.

The SC has emphasised that allegations in the complaint and the pre-summoning evidence on record, when taken on the face value and accepted in entirety, do not constitute the offence alleged, as in this case, the inherent powers of the Court can and should be exercised in such circumstances. In the case of a private complaint, the Magistrate can issue summons when the evidence produced at the pre-summoning stage shows that there is sufficient ground for proceeding against the accused. The material on record should indicate that the ingredients for taking cognisance of an offence and issuing summons to the accused is made out.

The SC has noted that in the present case, the trial court did not issue summons under section 420 and 471 of the IPC, or for that matter, invoke the provision relating to conspiracy under section 120B of the IPC. Although the summoning order of July 19, 2018 does not deal with these sections of the IPC, the Court thought it imperative to examine the ingredients of the relevant sections and section 406 of the IPC, and whether the allegations made in the complaint attract the penal provisions under the relevant sections of the IPC. The Court has undertaken this exercise in order to carry out a complete and comprehensive analysis of the factual matrix and the legal provisions, and rule out possibility of an error to the detriment of the respondent-complainant.

Section 406 of the IPC prescribes punishment for breach of trust which may extend to three years or with fine or both, when ingredients of section 405 of the IPC are satisfied. For section 406 of the IPC to get attracted, there must be criminal breach of trust in terms of section 405 of the IPC. For section 405 of the IPC to be attracted the following factors need to be established: (a) the accused was entrusted with property, or entrusted with dominion over property; (b) the accused had dishonestly misappropriated or converted to their own use or disposed of that property or willfully suffer any other person to do so; and (c) 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.

Thus, criminal breach of trust would, inter alia, mean using or disposing of the property by a person who is entrusted with or otherwise has dominion. Such an act must not only be done dishonestly, but also in violation of any direction of law or any contract express or implied relating to carrying out the trust.

However, in this case, material on record fail to satisfy the ingredients of section 405 of the IPC and does not state how and in what manner, on facts, the requirements are satisfied. Pre-summoning evidence is also lacking and suffers on this account. On these aspects, the summoning order is equally quiet, albeit, it states that “a forged demand of Rs 6,37,252.16 had been raised by Jotun India Pvt. Ltd. (JIPL), which demand is not due in terms of statements by Shubhankar P. Tomar and Sakshi Tilak Chand”.

A mere wrong demand or claim would not meet the conditions specified by section 405 of the IPC in the absence of evidence to establish entrustment, dishonest misappropriation, conversion, use or disposal, which action should be in violation of any direction of law, or legal contract touching the discharge of trust. Hence, even if the respondent-complainant is of the opinion that the monetary demand or claim is incorrect and not payable, given the failure to prove the requirements of the section 405 of the IPC, an offence under the same section is not constituted. In the absence of factual allegations, which satisfy the ingredients of the offence under section 405, a mere dispute on monetary demand of Rs 6,37,252.16 does not attract criminal prosecution under section 406 IPC.

In the present case, the ingredients to constitute an offence under section 420 read with section 415 of the IPC are absent. The pre-summoning evidence does not disclose and establish the essential ingredients of section 415 of the IPC. There is no assertion, much less legal evidence, to submit that JIPL had engaged in dishonesty, fraud or intentional inducement to deliver a property. The offence under section 420 IPC (cheating ) is nor made out.

The bill of March 30, 2013 was not fake or forged, and at best it could be stated that it was wrongly raised. Moreover, the pre-summoning evidence is silent with regard to this bill and mens rea on the part of the accused is not shown and established. Same would be the position with regard to the bill/invoice of Rs 53,215/- which was as per the complaint sent directly to Manav Rachna International at Faridabad. The bill/invoice is not doubted as ‘forged’ or ‘false’ within the meaning of sections 470 and 464 of the IPC.

The Supreme Court has observed that the Allahabad High Court, while dismissing the petition filed under section 482 of the Criminal Procedure Code failed to take due notice that criminal proceedings should not be allowed to be initiated when it is manifest that these proceedings have been initiated with ulterior motive of wreaking vengeance and with a view to spite the opposite side due to private or personal grudge.

The Supreme Court has allowed the appeal against the impugned order passed by the Allahabad High Court on March 30, 2022 after quashing and setting aside the HC’s order along with the summoning order of July 19, 2018 in the Complaint No. 3665/2017.