PENAL CODE - Section 420--Cheating--Complainant--
On 13th June, 1980, the petitioner obtained a loan of Rs. 20,000/- from the complainant and executed a pronote in favour of the complainant and at the time of the execution of the said pro-note, it was orally agreed that so long as the petitioner did not repay the aforesaid amount of loan, the petitioner would not take his share of the income from the truck and it was also agreed that so long as the petitioner did not repay the amount of the pronote, he would not be entitled to sell the truck and that the aforesaid agreement was also re-evolved on the back of the pronote.
The allegations contained in the complaint, do not make out the case that at the time when the complainant advanced the sum of Rs. 20,000/- to the petitioner, the petitioner had deceived the complainant by fraudulently including the complainant to advance the loan of Rs. 20,000/- to the petitioner & that but for the aforesaid inducement, the petitioner would not have paid the sum of Rs. 20,000/- to the complainant.
The petitioner in selling the truck before repaying the amount of the loan of Rs. 20,000/-, has committed breach of the agreement, which is said to have been entered into between the complainant and the petitioner on 13th June, 1980 when the complainant advanced the loan of Rs. 20,000/-to the petitioner. The aforesaid alleged breach of the agreement may give rise to civil liability but it would not give rise to any criminal liability.
Petition Allowed
Equivalent Citation: 1982WLN(UC)195
IN THE HIGH COURT OF RAJASTHAN
S.B. Criminal Misc. Petition No. 123/82
Decided On: 30.07.1982
Kayhaiya Lal Vs. The State of Rajasthan
Hon'ble Judges/Coram:
S.C. Agrawal, J.
Equivalent Citation: 1982WLN(UC)195
S.C. Agrawal, J.
Equivalent Citation: 1982WLN(UC)195
1. By this petition filed under Section 432 Cr. P.C., the accused-petitioner Kanhaiya Lal has prayed that the order dated 20th August, -1981 passed by the Judicial Magistrate, Suratgarh in Criminal Case No. 431/80 as well as the order dated 19th November, 1981 passed by the Additional Sessions Judge, Raisinghahagar camp at Suratgarh be quashed. By order dated 20th August, 1981, the Judicial Magistrate has framed a charge under Section 420 I.P.C. against the petitioner and by the order dated 19th November, 1981, the Additional Sessions Judge, Raisinghnagar has rejected the revision petition filed by the petitioner against the aforesaid order dated 20th August, 1981 passed by the Judicial Magistrate, Suratgarh.
2. On 25th July, 1980, Gopi Ram complainant filed a complaint against the petitioner in the court of Judicial Magistrate, Suratgarh. In the said complaint, the complainant alleged that one truck bearing registration no RJF 8659 was the joint property of the petitioner and one Hanuman Prasad and that on 12th June, 1979, the complainant, by contributing a sum of Rs. 12.636/-, became a co-owner to the extent of 1/3 share in the said truck, along with the petitioner and Hanuman Prasad. In the said complaint, it was further stated that on 13th June, 1980, the petitioner borrowed a sum of Rs. 20,000/- from the complainant and executed a pronote in favour of the complainant and that at the time of the execution of the pronote, it was orally agreed between the parties that till the petitioner repaid the aforesaid amount of loan, he would not take his share of the income from the truck and that it was also agreed that so long as the said amount was not repaid, the petitioner would have no right to sell the truck and that the aforesaid agreement was also recorded on the back of the pronote. In the complaint aforesaid, the complainant further alleged that since the truck was at Suratgarh and was being used for the transport of goods and the complaint was residing in village Kishanpura, the truck was being kept under the care and supervision of the petitioner. In the said complaint, it was further alleged that on 17th June, 1980, the complainant came to Suratgarh and made enquiries about the truck and he was informed by the petitioner that the truck had gone with certain goods to Rawatsar and would return in a day or two. According to the complaint, on 23rd July, 1980, Hanuman Prasad, another co-owner of the truck, came to the village of the complainant & informed the complainant that a fraud had been practiced upon him and that the petitioner had sold the truck to Lahotias of Rawatsar. There upon, the complainant asked the petitioner and he admitted that he had sold the truck and told the complainant to do whatever he liked and when the complainant asked the petitioner to return his share of the money, he refused to pay the same. In the said complaint, it was further alleged that on 24th July, 1980, the complainant went to police station, Suratgrah to lodge the report but the police authorities did not register the report on the ground that the matter was of a technical nature and that the complainant should obtain a direction from the court. In the said complaint, it was also alleged that the petitioner had fraudulently sold the truck and had retained the share of the complainant in the said truck and that the aforesaid offence committed by the petitioner was punishable under Section 420 I.P.C. and that the petitioner should be punished of the said offence.
3. The Judicial Magistrate by his Older dated 25th July, 1980 for warded the said complaint for investigation under Section 156(3) Cr. P.C. to the S.H.O., P.S. Suratgarh and thereupon a case under Section 420 I.P.C. was registered against the petitioner at P.S. Suratgarh on 1st August, 1980. After completing the investigation, the police submitted the charge-sheet in respect of offence under Section 420 LP C. against the petitioner in the court of Munsif and Judl. Magistrate First Class, Suratgarh on 6th October, 1980. After taking into consideration the papers that were submitted by the police along with the charge-sheet, the Judl. Magistrate passed the order dated 29th August, 1981 wherein he observed that from the papers filed along with the charge sheet, it appeared that the complainant has become co-sharer to the extent of one third share in truck no. RJF 8659 on payment of Rs. 12,636/- on 12th June, 1979 and that on 13th June, 1980, the petitioner had borrowed a sum of Rs. 20,000/- from the complainant on the express condition mentioned on the back of the pronote that till the aforesaid amount was repaid, the petitioner would not sell truck no. RJF 8659 but inspite of that the petitioner had sold the truck very soon on 18th July, 1980. The Judicial Magistrate was of the view that the aforesaid action of the petitioner falls within the ambit of illustration (g) of Section 415 I.P.C. and he, therefore, directed that, a charge under Section 420 I.P.C. be framed against the petitioner.
4. Feeling aggrieved by the aforesaid order dated 20th August, 1981 passed by the Judicial Magistrate, the petitioner filed a revision petition. The said revision petition was dismissed by the Additional Session Judge, Raisinghnagar camp at Suratgarh by his order dated 19th November, 1981. There after, the petitioner filed this petition under Section 482 Cr. P.C. in this Court.
5. I have heard Mr. Guru Prakash, the learned Counsel for the petitioner and Mr. H. S. Sandhu, the learned Counsel for the complainant.
6. Mr. Guru Prakash has submitted that on the basis of the averments contained in the complaint dated 25th July, 1980, submitted by the complainant before the Judicial Magistrate, Suratgarh and the other papers that were submitted by the police along with charge sheet, it cannot be said that an offence under Section 420 I.P.C. is made out against the petitioner. According to Mr. Guru Prakash, the dispute between the complainant and the petitioner relates to the breach of an agreement said to have been entered between the complainant and the petitioner on 13th June 1980 at the time when the complainant advanced a loan of Rs. 20,000/- to the petitioner & that the said breach of agreement can give rise to a civil liability only and it does not give rise to any criminal liability & that the Judicial Magistrate has erred in holding that the action of the petitioner constitutes cheating under Section 415, I,P.C. and in framing a charge under Section 420, I.P.C. In support of his aforesaid submission. Mr. Guruparakash has placed reliance on the decisions of the Supreme Court in State of Kerala v. A.P. Pillai MANU/SC/0263/1972 : 1972CriLJ1243 and Hari Prasad v. Bishnu Kumar MANU/SC/0112/1973 : 1974CriLJ352 .
7. The offence of cheating is defined in section 415, I.P.C. as under:
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 any thing 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 of properly, is said to "Cheat".
Explanation:- A dishonest concealment of facts is a deception within the meaning of this section.
The aforesaid section postulates deception of a person by (a) fraudulently or dishonestly inducing that person either to deliver any property to any person or to consent that any person shall retain any property ; or by (b) intentionally inducing that person 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. The fraudulent representation giving rise to the offence of cheating may relate to an existing fact or it may relate to a certain future event. In order that a representation about a future event or course of conduct may constitute the basis for charge of cheating it is necessary to establish that the representation was false to the knowledge of the maker at the time it was made. If the representation consists of a promise it must be established that the intention of the promisor was dishonest at the time of the making of the promise. Such a dishonest intention cannot be inferred from the mere fact that the promisor could not subsequently fulfil the promise.
8. In State of Kerala v. A.P. Pillai (1), the Supreme Court has held as under:
To bold a person guilty of the offence of cheating, it has to be shown that his intention was dishonest at the time of making the promise. Such a dishonest intention cannot be inferred from the mere fact that he could not subsequently fulfil the promise.
9. In Hari Prasod's case (2), the Supreme Court was dealing with a case where the appellant before the Supreme Court had' filed a complaint in respect of an offence under Section 420 IPC against the respondents on the allegation that the appellant had paid a sum of Rs. 35,000/- to the respondents on the basis of the statement of the respondents that they would start a transport business and that the appellant would be the proprietor of the said business and the respondents would ' work as his agents and when the appellant went to Calcutta, he found that the respondents were doing transport business but the appellant was not shown as' the proprietor of that business and that the respondents had failed to render the accounts of the said business to the appellant and had also failed to refund the money advanced by the appellant. The Sub-divisional Magistrate took cognizance of the offence under Section 420 IPC against the respondents but the High Court, in exercise of its inherent powers under Section 561A of the Code of Criminal Procedure, 1898, quashed the criminal proceedings on the view that the case of the appellant was based upon contract, & a mere breach of contract could not give rise to criminal prosecution and that the appellant had a remedy in the Civil Court The Supreme Court affirmed the said decision of the High Court and has observed as under:
There is nothing in the complaint to show that the respondents had dishonest or fraudulent intention at the time the appellant parted with Rs. 35,000/-. There is also nothing to indicate that the respondents induced the appellant to pay them Rs. 35,000/- by deceiving him. It is further not the case of the appellant that a representation was made by respondents to him at or before the time' he paid the money to them at the time the representation was made, the respondents knew the same to be false. The fact that the respondents subsequently did not abide by their commitment that they would show the appellant to be the proprietor of Diang Transport Corporation and would also render accounts to him in the month of December might create civil liability for them, but this fact would not be sufficient to fasten criminal liability on the respondents for the offence of cheating.
In the present case, the relevant averments are contained in para 2 of the complaint, which reads as under;
^^ ;g fd fnukad 13&6&80 dks eqLrxhl ls 20]000@& :0 udn m/kkj fy, o eqLrxhl ds gd es izksuksV Hkh rLnhd dj fn;k A bl izuksV dks fy[kokrs oDr tckuh r; gks x;k Fkk A fd vc rd eqyte ;g iSlk ugh nsxk rc rd Vªd dh vkenuh ls og viuk fgLlk ugh ysxk ;g r; gqvk fd tc rd eqyte izksuksV dh jde vnk ugh dj nsxk rc rd ml Vªd dks cspus dk dksbZ vf/kdkj ugh gksxk A bl vej dh rgjhj Hkh eqyfte us izksuksV dh ihNs nh Fkh A^^
10. A perusal of the aforesaid para shows that the case of the complainant is that on 13th June, 1980, the petitioner obtained a loan of Rs. 20,000/- from the complainant and executed a pronote in favour of the complainant and at the time of the execution of the said pronote, it was orally agreed that so long as the petitioner did not repay the aforesaid amount of loan, the petitioner would not take his share of the income from the truck and it was also agreed that so long as the petitioner did not repay the amount of the pronote, he would not be entitled to sell the truck and that the aforesaid agreement was also revolved on the, back of the pronote. This would show that in the complaint, the complainant has relied upon the oral agreement, which is said to hive been entered into between the Complainant and the petitioner on 23th June, 1980 at the time when the complainant advanced the loan of Rs. 20,000/- to the petitioner and the pronote was executed by the petitioner in favour of the complainant. There is, however, no averment in the complaint that the aforesaid loan of Rs 20,000/-was advanced by the complainant to the petitioner on the basis of the assurance said to have been given by the petitioner to the complainant that he would not sell the truck till the amount of the said loan was repaid. Nor is there an> thing in the complaint to show that but for the aforesaid assurance on the part of the petitioner, the complainant would not have paid the sum of Rs. 20,000/- to the petitioner. It is also not alleged in the complaint that in agreeing not to sell the truck till the amount of the loan was repaid, the intention of the petitioner, on 13th June, 1980, the date on which the said agreement is said to have taken place was dishonest and that the petitioner had no intention to honour the said agreement at that time. It would, thus, be seen that the allegations contained in the complaint, do not make out the case that at the time when the complainant advanced the sum of Rs. 20,000/- to the petitioner, the petitioner had deceived the complainant by fraudulently inducing the complainant to advance the loan of Rs. 20,000/- to the petitioner and that but for the aforesaid inducement, the petitioner would not have paid the sum of Rs. 20,000/- to the complainant. On the basis of the averments contained in 'be complaint, all tint can be said is that the petitioner in selling the truck before repaying the amount of the loan of Rs. 20,000/-, has committed breach of the agreement, which is said to have been entered into between the complainant and the petitioner on 13th June, 1980 when the complainant advanced the loan of Rs. 20,000/- to the petitioner. The aforesaid alleged breach of the agreement may give rise to civil liability but it would not give rise to any criminal liability. I have also perused the statements of the complainant as well as the statements of other persons, which were recorded during the course of investigation but the said statements do not contain anything more than that alleged in the complaint. Therefore, on the basis of the complaint and the papers that were submitted by the police along with the charge-sheet, it cannot be said that an offence under Section 420 I.P.C. is disclosed against the petitioner and the order dated 20th August 1981 passed by the Judicial Magistrate framing the charge under Section 420 I.P.C. as well as the order dated 19th November, 1981 passed by the Addl. Sessions Judge, Raisinghnagar in dismissing the revision petition of the petitioner cannot, therefore be upheld and charge framed against the petitioner under Section 420 I.P.C. must de quashed.
11. Mr. Sandhu, the learned Counsel for the complainant has, however, submitted that even if an offence under Section 420 I.P.C. is not made out on the basis of the allegations contained in the complaint, the offence under Section 406 I.P.C. is made out against the petitioner and, therefore, the entire proceedings cannot be quashed. In support of his aforesaid submission Mr. Sandhu has referred to the averments contained in paras 3 and 4 of the complaint. In para 3, it has been alleged that the truck was in Suratgarh and was being used for transport of goods and since the complainant is residing in village Kishanpura the truck was being kept with Kanhaiya Lal. In para 4 the complainant has alleged that the petitioner has sold the said truck to Lakhotias of Rawatsar and that when the complainant demanded from the petitioner his share in the sale price, the petitioner refused to pay the share of the complainant to him.
12. With regard to the offence of criminal breach of trust in respect of the partnership property, the Supreme Court in Velji Ragha vji v. State of Maharashtra MANU/SC/0091/1964 : 1965CriLJ431 had laid down that in respect of the partnership property, every partner has dominion over the partnership property by reason of the fact that he is a partner and in order to establish criminal breach of trust in respect of partnership property by a partner, the prosecution should establish that the dominion over the assets or a particular asset of the partnership was by a special agreement between the parties, entrusted to the accused person. The offence of criminal breach of trust under Section 405 I.P.C. can be made out against the petitioner only if it can be shown that the petitioner was specially entrusted with the dominion over the truck, in dispute by the other two owners of the said truck. The question as to whether an offence under Section 406 I.P.C. is made out against the petitioner on the basis of the papers, which have been filed along with the charge-sheet has not been considered by the Judicial Magistrate. It will be open to the Judicial Magistrate to consider the said question as to whether an offence under Section 406 I.P.C. or any other offence is disclosed against the petitioner.
13. In the result, the petition is allowed and the charge that has been framed by the Judicial Magistrate under Section 420 I.P.C. as against the petitioner is quashed. It would be open to the Judicial Magistrate to consider as to whether any other offence, including offence under Section 406 I.P.C, is disclosed against the petitioner on the basis of the papers that have been submitted along with the charge-sheet by the police.
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