At this stage we also think it proper to observe that in the
present case, even if the allegations made in the complaint are
taken to be true, the ingredients of the offence punishable
under Section 409 IPC for which appellants are summoned,
are also not made out. To constitute an offence punishable
under Section 409 IPC, apart from entrustment, it is also
essential requirement that it should be shown that the
accused has acted in the capacity of a public servant, banker,
merchant, factor, broker, attorney or agent. It is nowhere
shown in the complaint that the appellants have acted in any
of the above capacities.
Reportable
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO.953 OF 2015
(@ Special Leave Petition (Crl.) No. 330 of 2015)
Mr. Robert John D’Souza and others … Appellants
Versus
Mr. Stephen V. Gomes and another … Respondents
Citation; 2015 CRLJ 4040 SC
1. This appeal is directed against order dated 9.10.2014,
passed by the High Court of Karnataka at Bangalore in
Criminal Petition No. 658 of 2014 whereby said court has
dismissed the petition, and declined to quash the Criminal
Complaint case No. 357 of 2012, filed by respondent No. 1,
against the appellants.
2. Brief facts of the case are that a Society named – Mukka
Welfare Society was constituted on 28.3.1970 for charitable
work and social service, registered under Karnataka Societies
Registration Act, 1970. Appellant No. 1, appellant No. 2 and
appellant No. 3 were President, Secretary and Treasurer
respectively, while appellant Nos. 4 to 7 were Directors of the
Society. Other appellants are their relatives. A piece of land
bearing S. No. 239/10 measuring 0.50 acres in Village
Suratkal, Taluk Mangalore, was purchased by the Society vide
registered sale deed dated 28.1.1978 from one Smt. Kaveri
Hengsu. It is alleged by the complainant (respondent No. 1)
that appellant Nos. 1 to 7, being members of the Executive
and Directors of Mukka Welfare Society, misusing the
position, held Board Meetings on 22.9.1995 and 13.10.1995
facilitating the sale of the above mentioned land in favour of
their relatives (appellant Nos. 7 to 12). The sale deeds were
executed on 16.2.1996. It is further stated that the
purchasers (appellant Nos. 7 to 12), executed sale deeds in the
same year in favour of the Directors of the Society. It is
alleged by the complainant/respondent No.1 that the
appellants have fraudulently usurped the property through
the sale deeds mentioned above, and thereby committed
cheating.
3. The criminal complaint filed by respondent No. 1 was
registered by the 1st Additional Senior Civil Judge and Chief
Judicial Magistrate, Mangalore, DK, who, after recording the
statement of the complainant under Section 200 of the Code of
Criminal Procedure, 1973 (for short “CrPC”), summoned the
appellants vide order dated 13.4.2012 in respect of offences
punishable under Sections 406, 409, 420 read with Section 34
of Indian Penal Code (IPC). The appellants filed Criminal
Revision Petition No. 58 of 2012 before the Principal Sessions
& District Judge of D.K. District at Mangalore, which was
dismissed vide order dated 6.2.2013. Thereafter, the
appellants filed a petition under Section 482 CrPC before the
High Court and the same was also dismissed. Hence this
appeal through special leave.Page 4
Page 4 of 12
4. We have heard learned counsel for the parties and
perused the papers on record.
5. The impugned orders passed by the High Court and the
other authorities below are challenged before us mainly on the
following grounds: -
(i) Respondent No. 1/complainant is not a member of the
“Mukka Welfare Society” nor is he in any manner
connected with the affairs of the Society, as such he has
no locus to file the criminal complaint.
(ii) The sale deeds in question were executed in the year
1996, and the criminal complaint is filed malafide by
respondent No. 1 after a period of fourteen years, in the
year 2010, as such the courts below have erred in law in
not taking note of said fact.
(iii) The courts below have erred in law in not appreciating
that the complaint in question was filed to get personal
vendetta by respondent No. 1 against the Directors of the
Society.
(iv) The courts below further erred in not considering the fact
that the complainant/respondent No. 1 had earlier filed a
complaint, with same set of facts, before the Deputy
Commissioner, Dakshin Kannada, Mangalore, and thePage 5
Page 5 of 12
same was sent to Police Station Suratkal for
investigation, and the Circle Inspector, after
investigation, did not find any offence to have been
committed by the appellants, as the dispute was purely
of civil in nature.
(v) Ingredients of the offences punishable under Sections
406, 409 and 420 IPC are not made out.
(vi) None of the transactions of sale in question is against
any bye-law or clause of Memorandum of Association of
the Society.
6. In the counter affidavit filed on behalf of respondent
No.1, it has been stated that the complainant came to know of
the transactions of sale, only in the year 2009, whereafter he
complained before the Deputy Commissioner, D.K., as such
the issue raised as to delay in filing the complaint is
unfounded. It is further stated that the Mukka Welfare
Society receives donations from various institutions and
general public. The allegation of personal vendetta, pleaded
in the appeal by the appellants, has been denied in the
counter affidavit. Lastly, defending the orders passed by thePage 6
Page 6 of 12
courts below, it is stated that the courts below have
committed no error of law.
7. Arguments were advanced by learned counsel for the
parties on the above lines pleaded before us. Having
considered the submissions of the learned counsel for the
parties what is apparent in the present case is that the
complainant is not the member of Mukka Welfare Society. It
is also not disputed that the sale deeds in question were
executed way back in the year 1996 and the complainant, who
is not even member of the Society, raises the issue that the
sale deeds were executed for the benefit of the Directors of the
Society, after a long gap of more than twelve years. Sale deeds
in question are registered, and not declared null and void by
any court of law. It is also relevant to mention here that
admittedly earlier a complaint was made by the complainant
to the Deputy Commissioner in the year 2009, which was got
investigated by the police and the result of the investigation
was that no offence was found committed by the appellants on
the ground that the dispute is of civil in nature.Page 7
Page 7 of 12
8. In view of the above facts, apparent on the record, we are
of the view that the High Court and the courts below have
committed grave error of law in ignoring the same. Needless to
say that to constitute an offence punishable under Section
406 IPC, the essential ingredient is the “entrustment” of the
property. The complaint filed by the complainant nowhere
discloses that the land in question purchased in the year 1978
was entrusted to the Society for the benefit of others. It is only
after entrustment is shown, it can be said that there was
criminal breach of trust.
9. In Ram Narayan Popli v. Central Bureau of
Investigation1
, this Court, per majority, has explained
“entrustment” in paragraph 363 as under: -
“The term “entrustment” is not necessarily a term of
law. It may have different implications in different
contexts. In its most general signification all it
imports is the handing over possession for some
purpose which may not imply the conferring of any
proprietary right at all.”
10. In State of Gujarat v. Jaswantlal Nathalal2
, this
Court in paragraph 8 has observed that a mere transaction of
sale cannot amount to an entrustment.
1
(2003) 3 SCC 641
2 AIR 1968 SC 700
11. At this stage we also think it proper to observe that in the
present case, even if the allegations made in the complaint are
taken to be true, the ingredients of the offence punishable
under Section 409 IPC for which appellants are summoned,
are also not made out. To constitute an offence punishable
under Section 409 IPC, apart from entrustment, it is also
essential requirement that it should be shown that the
accused has acted in the capacity of a public servant, banker,
merchant, factor, broker, attorney or agent. It is nowhere
shown in the complaint that the appellants have acted in any
of the above capacities.
12. As far as offence of cheating is concerned, the same is
defined in Section 415 IPC, for which the punishment is
provided under Section 420 IPC. Section 415 reads as under:-
“415. Cheating. – Whoever, by deceiving any
person, fraudulently or dishonestly induces the
person so deceived to deliver any property to any
person, or to consent that any person shall retain
any property, or intentionally induces the person so
deceived to do or omit to do anything which he
would not do or omit if he were not so deceived, and
which act or omission causes or is likely to cause
damage or harm to that person in body, mind,
reputation or property, is said to “cheat”.
Explanation. – A dishonest concealment of
facts is a deception within the meaning of this
section.
Illustrations ……………”
13. From the above language of the Section, one of the
essential ingredients for the offence of cheating is deception,
but in the present case, from the contents of the complaint it
nowhere reflects that the complainant was deceived or he or
anyone else was induced to deliver the property by deception.
What was done, was so reflected in the resolutions, and sale
deeds.
14. In Mathavrao Jiwajirao Scindia and others v.
Sambhajirao Chandrojirao Angre and others3
, a
three-Judge Bench of this Court has laid down the law as to
quashment of proceedings under Section 482 CrPC as
follows:-
“7. The legal position is well settled that when a
prosecution at the initial stage is asked to be
quashed, the test to be applied by the court is as to
whether the uncontroverted allegations as made
prima facie establish the offence. It is also for the
court to take into consideration any special features
which appear in a particular case to consider
whether it is expedient and in the interest of justice
to permit a prosecution to continue. This is so on
3
(1988) 1 SCC 692
the basis that the court cannot be utilised for any
oblique purpose and where in the opinion of the
court chances of an ultimate conviction is bleak
and, therefore, no useful purpose is likely to be
served by allowing a criminal prosecution to
continue, the court may while taking into
consideration the special facts of a case also quash
the proceeding even though it may be at a
preliminary stage.”
15. In Suresh v. Mahadevappa Shivappa Danannava
and another4
, criminal prosecution was quashed by the Court
in respect offence of cheating noticing that the complaint was
filed after a lapse of ten years.
16. In Inder Mohan Goswami and another v. State of
Uttaranchal and others5
, this Court in paragraphs 25 and
46 has observed as under: -
“25. Reference to the following cases would reveal
that the courts have consistently taken the view
that they must use this extraordinary power to
prevent injustice and secure the ends of justice. The
English courts have also used inherent power to
achieve the same objective. It is generally agreed
that the Crown Court has inherent power to protect
its process from abuse. In Connelly v. DPP (1964
AC 1254) Lord Devlin stated that where particular
criminal proceedings constitute an abuse of
process, the court is empowered to refuse to allow
the indictment to proceed to trial. Lord Salmon in
DPP v. Humphrys (1977 AC 1) stressed the
4
(2005) 3 SCC 670
5
(2007) 12 SCC 1
importance of the inherent power when he observed
that it is only if the prosecution amounts to an
abuse of the process of the court and is oppressive
and vexatious that the judge has the power to
intervene. He further mentioned that the court’s
power to prevent such abuse is of great
constitutional importance and should be jealously
preserved.
46. The court must ensure that criminal
prosecution is not used as an instrument of
harassment or for seeking private vendetta or with
an ulterior motive to pressurise the accused. On
analysis of the aforementioned cases, we are of the
opinion that it is neither possible nor desirable to
lay down an inflexible rule that would govern the
exercise of inherent jurisdiction. Inherent
jurisdiction of the High Courts under Section 482
CrPC though wide has to be exercised sparingly,
carefully and with caution and only when it is
justified by the tests specifically laid down in the
statute itself and in the aforementioned cases. In
view of the settled legal position, the impugned
judgment cannot be sustained.”
17. In view of the above discussion and facts and
circumstances of the case, we are of the view that none of the
offences for which the appellants are summoned, is made out
from the complaint and material on record. We further find
that it is nothing but abuse of process of law on the part of the
complainant to implicate the appellants in a criminal case
after a period of twelve years of execution of registered sale
deeds in question, who is neither party to the sale deeds nor a
member of the Society. Therefore, we allow the appeal and set
aside the orders passed by the High Court and that of the
courts below. Accordingly, the order passed by the Magistrate
summoning the appellants in the criminal complaint filed by
respondent No. 1, in respect of offences punishable under
Sections 406, 409 and 420 IPC, also stands quashed.
……………….....…………J.
[Dipak Misra]
.……………….……………J.
[Prafulla C. Pant]
New Delhi;
July 21, 2015.
Print Page
present case, even if the allegations made in the complaint are
taken to be true, the ingredients of the offence punishable
under Section 409 IPC for which appellants are summoned,
are also not made out. To constitute an offence punishable
under Section 409 IPC, apart from entrustment, it is also
essential requirement that it should be shown that the
accused has acted in the capacity of a public servant, banker,
merchant, factor, broker, attorney or agent. It is nowhere
shown in the complaint that the appellants have acted in any
of the above capacities.
Reportable
IN THE SUPREME COURT OF INDIA
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO.953 OF 2015
(@ Special Leave Petition (Crl.) No. 330 of 2015)
Mr. Robert John D’Souza and others … Appellants
Versus
Mr. Stephen V. Gomes and another … Respondents
Citation; 2015 CRLJ 4040 SC
1. This appeal is directed against order dated 9.10.2014,
passed by the High Court of Karnataka at Bangalore in
Criminal Petition No. 658 of 2014 whereby said court has
dismissed the petition, and declined to quash the Criminal
Complaint case No. 357 of 2012, filed by respondent No. 1,
against the appellants.
2. Brief facts of the case are that a Society named – Mukka
Welfare Society was constituted on 28.3.1970 for charitable
work and social service, registered under Karnataka Societies
Registration Act, 1970. Appellant No. 1, appellant No. 2 and
appellant No. 3 were President, Secretary and Treasurer
respectively, while appellant Nos. 4 to 7 were Directors of the
Society. Other appellants are their relatives. A piece of land
bearing S. No. 239/10 measuring 0.50 acres in Village
Suratkal, Taluk Mangalore, was purchased by the Society vide
registered sale deed dated 28.1.1978 from one Smt. Kaveri
Hengsu. It is alleged by the complainant (respondent No. 1)
that appellant Nos. 1 to 7, being members of the Executive
and Directors of Mukka Welfare Society, misusing the
position, held Board Meetings on 22.9.1995 and 13.10.1995
facilitating the sale of the above mentioned land in favour of
their relatives (appellant Nos. 7 to 12). The sale deeds were
executed on 16.2.1996. It is further stated that the
purchasers (appellant Nos. 7 to 12), executed sale deeds in the
same year in favour of the Directors of the Society. It is
alleged by the complainant/respondent No.1 that the
appellants have fraudulently usurped the property through
the sale deeds mentioned above, and thereby committed
cheating.
3. The criminal complaint filed by respondent No. 1 was
registered by the 1st Additional Senior Civil Judge and Chief
Judicial Magistrate, Mangalore, DK, who, after recording the
statement of the complainant under Section 200 of the Code of
Criminal Procedure, 1973 (for short “CrPC”), summoned the
appellants vide order dated 13.4.2012 in respect of offences
punishable under Sections 406, 409, 420 read with Section 34
of Indian Penal Code (IPC). The appellants filed Criminal
Revision Petition No. 58 of 2012 before the Principal Sessions
& District Judge of D.K. District at Mangalore, which was
dismissed vide order dated 6.2.2013. Thereafter, the
appellants filed a petition under Section 482 CrPC before the
High Court and the same was also dismissed. Hence this
appeal through special leave.Page 4
Page 4 of 12
4. We have heard learned counsel for the parties and
perused the papers on record.
5. The impugned orders passed by the High Court and the
other authorities below are challenged before us mainly on the
following grounds: -
(i) Respondent No. 1/complainant is not a member of the
“Mukka Welfare Society” nor is he in any manner
connected with the affairs of the Society, as such he has
no locus to file the criminal complaint.
(ii) The sale deeds in question were executed in the year
1996, and the criminal complaint is filed malafide by
respondent No. 1 after a period of fourteen years, in the
year 2010, as such the courts below have erred in law in
not taking note of said fact.
(iii) The courts below have erred in law in not appreciating
that the complaint in question was filed to get personal
vendetta by respondent No. 1 against the Directors of the
Society.
(iv) The courts below further erred in not considering the fact
that the complainant/respondent No. 1 had earlier filed a
complaint, with same set of facts, before the Deputy
Commissioner, Dakshin Kannada, Mangalore, and thePage 5
Page 5 of 12
same was sent to Police Station Suratkal for
investigation, and the Circle Inspector, after
investigation, did not find any offence to have been
committed by the appellants, as the dispute was purely
of civil in nature.
(v) Ingredients of the offences punishable under Sections
406, 409 and 420 IPC are not made out.
(vi) None of the transactions of sale in question is against
any bye-law or clause of Memorandum of Association of
the Society.
6. In the counter affidavit filed on behalf of respondent
No.1, it has been stated that the complainant came to know of
the transactions of sale, only in the year 2009, whereafter he
complained before the Deputy Commissioner, D.K., as such
the issue raised as to delay in filing the complaint is
unfounded. It is further stated that the Mukka Welfare
Society receives donations from various institutions and
general public. The allegation of personal vendetta, pleaded
in the appeal by the appellants, has been denied in the
counter affidavit. Lastly, defending the orders passed by thePage 6
Page 6 of 12
courts below, it is stated that the courts below have
committed no error of law.
7. Arguments were advanced by learned counsel for the
parties on the above lines pleaded before us. Having
considered the submissions of the learned counsel for the
parties what is apparent in the present case is that the
complainant is not the member of Mukka Welfare Society. It
is also not disputed that the sale deeds in question were
executed way back in the year 1996 and the complainant, who
is not even member of the Society, raises the issue that the
sale deeds were executed for the benefit of the Directors of the
Society, after a long gap of more than twelve years. Sale deeds
in question are registered, and not declared null and void by
any court of law. It is also relevant to mention here that
admittedly earlier a complaint was made by the complainant
to the Deputy Commissioner in the year 2009, which was got
investigated by the police and the result of the investigation
was that no offence was found committed by the appellants on
the ground that the dispute is of civil in nature.Page 7
Page 7 of 12
8. In view of the above facts, apparent on the record, we are
of the view that the High Court and the courts below have
committed grave error of law in ignoring the same. Needless to
say that to constitute an offence punishable under Section
406 IPC, the essential ingredient is the “entrustment” of the
property. The complaint filed by the complainant nowhere
discloses that the land in question purchased in the year 1978
was entrusted to the Society for the benefit of others. It is only
after entrustment is shown, it can be said that there was
criminal breach of trust.
9. In Ram Narayan Popli v. Central Bureau of
Investigation1
, this Court, per majority, has explained
“entrustment” in paragraph 363 as under: -
“The term “entrustment” is not necessarily a term of
law. It may have different implications in different
contexts. In its most general signification all it
imports is the handing over possession for some
purpose which may not imply the conferring of any
proprietary right at all.”
10. In State of Gujarat v. Jaswantlal Nathalal2
, this
Court in paragraph 8 has observed that a mere transaction of
sale cannot amount to an entrustment.
1
(2003) 3 SCC 641
2 AIR 1968 SC 700
11. At this stage we also think it proper to observe that in the
present case, even if the allegations made in the complaint are
taken to be true, the ingredients of the offence punishable
under Section 409 IPC for which appellants are summoned,
are also not made out. To constitute an offence punishable
under Section 409 IPC, apart from entrustment, it is also
essential requirement that it should be shown that the
accused has acted in the capacity of a public servant, banker,
merchant, factor, broker, attorney or agent. It is nowhere
shown in the complaint that the appellants have acted in any
of the above capacities.
12. As far as offence of cheating is concerned, the same is
defined in Section 415 IPC, for which the punishment is
provided under Section 420 IPC. Section 415 reads as under:-
“415. Cheating. – Whoever, by deceiving any
person, fraudulently or dishonestly induces the
person so deceived to deliver any property to any
person, or to consent that any person shall retain
any property, or intentionally induces the person so
deceived to do or omit to do anything which he
would not do or omit if he were not so deceived, and
which act or omission causes or is likely to cause
damage or harm to that person in body, mind,
reputation or property, is said to “cheat”.
Explanation. – A dishonest concealment of
facts is a deception within the meaning of this
section.
Illustrations ……………”
13. From the above language of the Section, one of the
essential ingredients for the offence of cheating is deception,
but in the present case, from the contents of the complaint it
nowhere reflects that the complainant was deceived or he or
anyone else was induced to deliver the property by deception.
What was done, was so reflected in the resolutions, and sale
deeds.
14. In Mathavrao Jiwajirao Scindia and others v.
Sambhajirao Chandrojirao Angre and others3
, a
three-Judge Bench of this Court has laid down the law as to
quashment of proceedings under Section 482 CrPC as
follows:-
“7. The legal position is well settled that when a
prosecution at the initial stage is asked to be
quashed, the test to be applied by the court is as to
whether the uncontroverted allegations as made
prima facie establish the offence. It is also for the
court to take into consideration any special features
which appear in a particular case to consider
whether it is expedient and in the interest of justice
to permit a prosecution to continue. This is so on
3
(1988) 1 SCC 692
the basis that the court cannot be utilised for any
oblique purpose and where in the opinion of the
court chances of an ultimate conviction is bleak
and, therefore, no useful purpose is likely to be
served by allowing a criminal prosecution to
continue, the court may while taking into
consideration the special facts of a case also quash
the proceeding even though it may be at a
preliminary stage.”
15. In Suresh v. Mahadevappa Shivappa Danannava
and another4
, criminal prosecution was quashed by the Court
in respect offence of cheating noticing that the complaint was
filed after a lapse of ten years.
16. In Inder Mohan Goswami and another v. State of
Uttaranchal and others5
, this Court in paragraphs 25 and
46 has observed as under: -
“25. Reference to the following cases would reveal
that the courts have consistently taken the view
that they must use this extraordinary power to
prevent injustice and secure the ends of justice. The
English courts have also used inherent power to
achieve the same objective. It is generally agreed
that the Crown Court has inherent power to protect
its process from abuse. In Connelly v. DPP (1964
AC 1254) Lord Devlin stated that where particular
criminal proceedings constitute an abuse of
process, the court is empowered to refuse to allow
the indictment to proceed to trial. Lord Salmon in
DPP v. Humphrys (1977 AC 1) stressed the
4
(2005) 3 SCC 670
5
(2007) 12 SCC 1
importance of the inherent power when he observed
that it is only if the prosecution amounts to an
abuse of the process of the court and is oppressive
and vexatious that the judge has the power to
intervene. He further mentioned that the court’s
power to prevent such abuse is of great
constitutional importance and should be jealously
preserved.
46. The court must ensure that criminal
prosecution is not used as an instrument of
harassment or for seeking private vendetta or with
an ulterior motive to pressurise the accused. On
analysis of the aforementioned cases, we are of the
opinion that it is neither possible nor desirable to
lay down an inflexible rule that would govern the
exercise of inherent jurisdiction. Inherent
jurisdiction of the High Courts under Section 482
CrPC though wide has to be exercised sparingly,
carefully and with caution and only when it is
justified by the tests specifically laid down in the
statute itself and in the aforementioned cases. In
view of the settled legal position, the impugned
judgment cannot be sustained.”
17. In view of the above discussion and facts and
circumstances of the case, we are of the view that none of the
offences for which the appellants are summoned, is made out
from the complaint and material on record. We further find
that it is nothing but abuse of process of law on the part of the
complainant to implicate the appellants in a criminal case
after a period of twelve years of execution of registered sale
deeds in question, who is neither party to the sale deeds nor a
member of the Society. Therefore, we allow the appeal and set
aside the orders passed by the High Court and that of the
courts below. Accordingly, the order passed by the Magistrate
summoning the appellants in the criminal complaint filed by
respondent No. 1, in respect of offences punishable under
Sections 406, 409 and 420 IPC, also stands quashed.
……………….....…………J.
[Dipak Misra]
.……………….……………J.
[Prafulla C. Pant]
New Delhi;
July 21, 2015.
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