MEHBOOB-UR-REHMAN (D) THR. LRS. versus SUDHA SEETHARAM & ANR

MEHBOOB-UR-REHMAN (D) THR. LRS. v. AHSANUL GHANI[2019] 2 S.C.R. 185

[DINESH MAHESHWARI, J.]

PROF R K VIJAYASARATHY & ANR

SUDHA SEETHARAM & ANR

(Criminal Appeal No. 238 of 2019)

FEBRUARY 15, 2019

[DR. DHANANJAYA Y CHANDRACHUD ANDHEMANT GUPTA, JJ.]

Code of Criminal Procedure, 1973:

s.482 – Petition under – Seeking quashing of criminalproceeding initiated u/ss. 405, 406, 415 and 420 IPC – Rejected byHigh Court – On appeal, held: High Court, in exercise of jurisdictionu/s. 482 is required to examine whether the averments in thecomplaint, taken on their face, constitute ingredients necessary foran offence alleged – The complaint in the present case is bereft ofthe basic facts necessary to constitute the offences alleged u/ss.405, 406, 415 and 420 IPC – An attempt has been made by thecomplainant to cloak civil dispute with criminal nature – Thecomplaint constitutes an abuse of process of court and therefore isliable to be quashed – Penal Code, 1860 – ss. 405,406, 415 and420.

On the private complaint of respondent No.1, FIR u/ss.405, 406, 415 and 420 r/w s.34 IPC was lodged. The case of thecomplainant (respondent No.1) was that the civil suit filed by theson of the appellants for recovery of Rs. 20 lakhs given to her(respondent No.1) by the son of the appellants was without anymerit as the same has been returned by respondent No.1 to theappellants. She alleged that the appellants and their son hadcolluded to siphon the money.

Appellants’ petition u/s. 482 Cr.P.C., seeking quashingof the FIR was rejected and the criminal proceedings were stayedtill the disposal of the civil suit. Hence the present appeal.

Allowing the appeal, the Court

HELD: 1.1 Section 482 of Cr.P.C. saves the inherentpower of the High Court to make orders necessary to secure theends of justice. The High Court, in the exercise of its jurisdictionunder Section 482 of the Cr.P.C., is required to examine whether

Athe averments in the complaint constitute the ingredientsnecessary for an offence alleged under the Penal Code. If theaverments taken on their face do not constitute the ingredientsnecessary for the offence, the criminal proceedings may bequashed under Section 482. The complaint must be examined asa whole, without evaluating the merits of the allegations. ThoughBthe law does not require that the complaint reproduces the legalingredients of the offence verbatim, the complaint must containthe basic facts necessary for making out an offence under thePenal Code. court exercising its inherent jurisdiction mustexamine if on their face, the averments made in the complaintCconstitute the ingredients necessary for the offence.[Paras 11, 12 and 16][191-B, D-E, 193-G]1.2 The jurisdiction under Section 482 of the Code ofCriminal Procedure has to be exercised with care. In the exerciseof its jurisdiction, High Court can examine whether matterDwhich is essentially of civil nature has been given cloak of acriminal offence. Where the ingredients required to constitute acriminal offence are not made out from bare reading of thecomplaint, the continuation of the criminal proceeding willconstitute an abuse of the process of the court. [Para 23][198-D]

Indian Oil Corpn. v NEPC India Ltd. (2006) 6 SCCE736 : [2006] 3 Suppl. SCR 704 – relied on.

2.1 In the present case, the first respondent has allegedin the complaint that the appellants have committed offencesunder Sections 405, 406, 415 and 420 read with Section 34 of thePenal Code. It is clear from the face of the complaint, that noFamount was entrusted by the first respondent to either of theappellants and there was no dishonest inducement of the firstrespondent by the appellants to deliver any property. As statedby the first respondent in the complaint, the money belonged tothe son of the appellants. It was transferred by the appellants’Gson to her on his own volition. The money was alleged to havebeen returned to the appellants on the instructions of their son.A plain reading of the complaint thus shows that the ingredientsnecessary for constituting offences under Sections 405, 415 and

420 of the Penal Code are not made out. Thus, the complaint inthe present case is bereft of the basic facts necessary to constitutethe offences alleged under Sections 405, 406, 415 and 420 of thePenal Code. [Paras 20 and 21][196-E-F, 197-D]

2.2 In the present case, the son of the appellants hasinstituted civil suit for the recovery of money against the firstrespondent. The suit is pending. The first respondent has filedthe complaint against the appellants six years after the date ofthe alleged transaction and nearly three years from the filing ofthe suit. The averments in the complaint, read on its face, do notdisclose the ingredients necessary to constitute offences underthe Penal Code. An attempt has been made by the first respondentto cloak civil dispute with criminal nature despite the absenceof the ingredients necessary to constitute criminal offence. Thecomplaint filed by the first respondent against the appellantsconstitutes an abuse of process of court and is liable to bequashed. [Para 24]

Binod Kumar v State of Bihar (2014) 10 SCC 663 :[2014] 11 SCR 85; State of Karnataka v. L Muniswamy(1977) 2 SCC 699 : [1977] 3 SCR 113 – relied on.

Rajesh Bajaj v State of NCT of Delhi (1999) 3 SCC259 : [1999] 1 SCR 1012 – held inapplicable.

CRIMINAL APPELLATE JURISDICTION : Criminal AppealNo. 238 of 2019.

From the Judgment and Order dated 01.09.2016 of the HighCourt of Karnataka at Bengaluru in Criminal Petition No. 3675 of 2016

Nidhesh Gupta, Sr. Adv., Sanjay Jain, Anurag Tandon, Advs. forthe Appellants.

Ms. Pritha Srikumar, Ms. Neha Mathen, Joseph Aristotle,Mrs. Priya Aristotle, Shiva P. Advs. for the Respondents.

AThe Judgment of the Court was delivered byDR. DHANANJAYA Y CHANDRACHUD, J.

1. Delay condoned.

2. The present appeal arises from the judgment and final orderdated 1 January 2016 of the High Court of Karnataka,rejecting the prayerBof the appellants to quash the criminal proceedings instituted by the firstrespondent against them. The High Court stayed the criminal proceedingstill the disposal of pending civil suit instituted by the son of the appellantsagainst the first respondent.

3. The facts relevant to the present dispute are thus:

CRajiv VijayasarathyRatnam, (the son of the appellants) and SavithaSeetharam (the daughter of the first respondent) were married on 24May 2002. They moved to the United States of America and child wasborn to them in 2009. Savitha was involved in car accident on 5 February2010 and proceedings were initiated against her abroad. It is alleged byDthe appellants that fearing the attachment of their son’s property in theproceedings, an amount of Rs 20 lakhs was transferred by Rajiv to thebank account of the first respondent on 17 February 2010. Following abreakdown in marital relations, Savitha and Rajiv have been livingseparately since October 2010. Multiple rounds of litigation ensued invarious courts.E[[1]]4. Savitha filed private complaint[[1]]against her husband Rajivand the appellants alleging the commission of various offences, includingcriminal intimidation and demand for dowry. The High Court ofKarnataka quashed the proceeding against appellant No. 2. On 14February 2013, Rajiv filed civil suit for recovery of money[2] against theFfirst respondent for the return of the money allegedly transferred by himinto her bank account.The suit is pending. Two divorce petitions institutedby Savita have been dismissed by the family court.

5. On 25 February 2016, the first respondent filed privatecomplaint[3] against the appellants which forms the subject matter of theGpresent appeal. The first respondent alleges that the amount of Rs 20Lakhs which was transferred by the son of the appellants was returnedin cash to the appellants with interest of Rs 24,000 on 1 July 2010. No

1 PCR No. 3418 of 2012; FIR No. 18 of 2012 registered on 23 February 2012

2 O. S. No. 1305 of 2013

H3 PCR 2116 of 2016

receipt was allegedly received by the first respondent. It is alleged thatthe appellants and their son have colluded to siphon the money and thatthe civil suit filed by the son of the appellants is without merit. On 11May 2016, the Additional Metropolitan Magistrate referred the complaintfor investigation under Section 156(3) of the Code of Criminal Procedure1973. On 19 May 2016, First Information Report[4] was registered underSections 405, 406, 415 and 420 read with Section 34 of the PenalCode.Aggrieved by the judgment and final order of the High Courtrejecting their petition to quash the FIR, the appellants have filed thepresent appeal.

6. MrNidhesh Gupta, learned Senior Counsel representing theappellants urged the following submissions:

i)No offence is made out from the averments in thecomplaint as they stand;

ii)The first respondent has admitted that the amount whichforms the subject matter of the present dispute wasreceived from the son of the appellants;

iii) The subject matter of the present dispute is of civilnature and the criminal complaint constitutes an abuseof the process of the court; and

iv) The allegations in the present complaint are similar tothe previous complaint filed by the daughter of the firstrespondent.

7. On the other hand, MsPrithaSrikumar, learned counsel forthe respondents urged the following submissions:

i)The criminal proceeding is not liable to be quashed asthe allegations in the complaint disclose the ingredientsnecessary to constitute an offenceunder Sections 405,406, 415 and 420 of the Penal Code;

ii) The appellants have colluded with their son to siphonthe money as no receipt was given to the first respondentwhen the amount of Rs 20,24,000 was transferred; and

iii) The law does not require that the complaint shouldreproduce verbatim every ingredient of the criminaloffence in the complaint.

8. The rival submissions fall for our consideration.

4 FIR

9. The primary question before this Court is whether the HighCourt has erred in rejecting the plea of the appellants for quashing thecriminal proceedings against them. The question at the heart of the presentdispute is whether the averments in the complaint disclose the ingredientsnecessary to constitute an offence under the Penal Code.

10. Section 482 of Code of Criminal Procedure saves the inherentpower of the High Court to make orders necessary to secure the endsof justice. In Indian Oil Corpn. v NEPC India Ltd.[5], two judgeBench of this Court reviewed the precedents on the exercise of jurisdictionunder Section 482 of the Code of Criminal Procedure 1973 and formulatedguiding principles in the following terms:

(i) complaint can be quashed where the allegations madein the complaint, even if they are taken at their face valueand accepted in their entirety, do not prima facie constituteany offence or make out the case alleged against theaccused. For this purpose, the complaint has to be examinedas whole, but without examining the merits of the allegations.Neither detailed inquiry nor meticulous analysis of thematerial nor an assessment of the reliability or genuinenessof the allegations in the complaint, is warranted whileexamining prayer for quashing of complaint.

(ii) complaint may also be quashed where it is clearabuse of the process of the court, as when the criminalproceeding is found to have been initiated with mala fidesmalice for wreaking vengeance or to cause harm, or wherethe allegations are absurd and inherently improbable.

(iii) The power to quash shall not, however, be used to stifleor scuttle legitimate prosecution. The power should be usedsparingly and with abundant caution.

(iv) The complaint is not required to verbatim reproduce thelegal ingredients of the offence alleged. If the necessaryfactual foundation is laid in the complaint, merely on the groundthat few ingredients have not been stated in detail, theproceedings should not be quashed. Quashing of the complaintis warranted only where the complaint is so bereft of even

the basic facts which are absolutely necessary for makingout the offence.(v) …”

11. The High Court, in the exercise of itsjurisdiction under Section482 of the Code of Criminal Procedure, is required to examine whetherthe averments in the complaint constitute the ingredients necessary foranoffencealleged under the Penal Code. If the averments taken on theirface do not constitute the ingredients necessary for the offence, thecriminal proceedings may be quashed under Section 482. criminalproceeding can be quashed where the allegations made in the complaintdo not disclose the commission of an offence under the Penal Code.The complaint must be examined as whole, without evaluating themerits of the allegations. Though the law does not require that thecomplaint reproduce the legal ingredients of the offenc everbatim, thecomplaint must contain the basic facts necessary for making out anoffence under the Penal Code.

12. The first respondent has alleged in the complaint that theappellants have committed offences under Sections 405, 406, 415 and420 read with Section 34 of the Penal Code. It would thus be necessaryto examine the ingredients of the above offences and whether theallegations made in the complaint, read on their face, attract those offencesunder the Penal Code.

13. Section 405 of the Penal Code reads thus:

“Section 405.- Criminal breach of trust.-Whoever, being in any manner entrusted withproperty, or with any dominion over property,dishonestly misappropriates or converts to hisown use that property, or dishonestly uses ordisposes of that property in violation of anydirection of law prescribing the mode in whichsuch trust is to be discharged, or of any legalcontract, express or implied, which he has madetouching the discharge of such trust, or willfullysuffers any other person so to do, commits“criminal breach of trust”.

careful reading of Section 405 shows that the ingredients of acriminal breach of trust are as follows:

Ai) person should have been entrusted with property, orentrusted with dominion over property;

ii) That person should dishonestly misappropriate or convertto their own use that property, or dishonestly use ordispose of that property or willfully suffer any otherperson to do so; and

iii) That such misappropriation, conversion, use or disposalshould be in violation of any direction of law prescribingthe mode in which such trust is to be discharged, or ofany legal contract which the person has made, touchingthe discharge of such trust.

Entrustment is an essential ingredient of the offence. personwho dishonestly misappropriates property entrusted to them contrary tothe terms of an obligation imposedis liable for criminal breach of trustand is punished under Section 406 of the Penal Code[6].

14. Section 415 of the Penal Code reads thus:

“Section 415. Cheating.- Whoever, bydeceiving any person, fraudulently or dishonestlyinduces the person so deceived to deliver anyproperty to any person, or to consent that anyperson shall retain any property, or intentionally inducesEthe person so deceived to do or omit to do anythingwhich he would not do or omit if he were not so deceived,and which act or omission causes or is likely to causedamage or harm to that person in body, mind, reputationor property, is said to “cheat”.”

FThe ingredients to constitute an offence of cheating are asfollows:

i)there should be fraudulent or dishonest inducement of aperson by deceiving him;

ii) (a)the person so induced should be intentionally inducedto deliver any property to any person or to consentthat any person shall retain any property, or

(b)the person so induced should be intentionally inducedto do or to omit to do anything which he would not

do or omit if he were not so deceived; and

6Section 406. Punishment for criminal breach of trust

H.- Whoever commits criminal breach of trust shall be punished with imprisonment ofeither description for term which may extend to three years, or with fine, or withboth.

iii) in cases covered by (ii) (b) above, the act or omission should be one which caused or is likely to cause damage or harm to the person induced in body, mind, reputation or property.

fraudulent or dishonest inducement is an essential ingredientof the offence. person who dishonestly induces another person todeliver any property is liable for the offence of cheating.

15. Section 420 of the Penal Code reads thus:

“Section 420. Cheating and dishonestlyinducing deliver of property.- Whoever cheatsand thereby dishonestly induces the persondeceived to deliver any property to any person,or to make, alter or destroy the whole or any partof valuable security, or anything which is signedor sealed, and which is capable to being convertedinto valuable security, shall be punished withimprisonment of either description for termwhich may extend to seven years, and shall alsobe liable to fine.”

The ingredients to constitute an offence under Section 420 are as follows:

i)A person must commit the offence of cheating underSection 415; and

ii)The person cheated must be dishonestly induced to

(a) deliver property to any person; or

(b) make, alter or destroy valuable security or

anything signed or sealed and capable of being convertedinto valuable security.

Cheating is an essential ingredient for an act to constitute an offenceunder Section 420.

16. court exercising its inherent jurisdiction must examine ifon their face, the averments made in the complaint constitute theingredients necessary for the offence.The relevant extract of thecomplaint filed by the first respondent is extracted below:

“The accused person’s son Mr. RajivVijayasarathyRatnam started to transfer all hismonies to different accounts and also transferredHsome monies belonging to him in the US to his

parents accounts in Bangalore, India and he alsopleaded his wife i.e. Complainant’s daughterthat he also wanted to divert some fundsunto Complainant’s account in Bangalore… ThatRajiv Vijayasarathy Ratnam diverted some of hismonies to Accused No. 1 and 2 and theComplainant…

It is further pertinent to mention that the accidentoccurred on 05.02.2010 and money wastransferred on 17.02.2010, the transfer wasdue to the insecurity at the behest of Mr.Rajiv Vijayasarathy Rathnam, the money wasnot sought or required by the complainant.

The Complainant daughter Ms. SavithaSeetharamconvinced the Complainant to accept transfer ofmonies which was for the benefit of theAccused person’s son Mr. Rajiv VijayasarathyRatnam and to hold it in trustforhim and accordingly the son of the accusedtransferred monies on 17[th] February 2010to the Complainant account Rs. 20,00,000/-(Rupees Twenty Lakhs only) … It is pertinent tomention that the accused person’s son Mr. RajivVijayasarathy Ratnam insisted the Complainantand her husband to pay the said monies by wayof cash to the accused person’s including theinterest…Mr. Rajiv Vijayasarathy Ratnamsought for the return of the aforesaid moniesi.e. of Rs. 20,00,000/-”

“…The said monies were paid in cash as perthe dicta of the accused person’s son Mr. RajivVijayasarathy Ratnam has filed false andfrivolous suit…”(Emphasis supplied)

17. The condition necessary for an act to constitute an offenceunder Section 405 of the Penal Code is that the accused was entrustedwith some property or has dominion over property. The first respondenthas stated that the disputed sum was transferred by the son of theappellants of his own volition to her. The complaint clearly states that

the amount was transferred for the benefit of the son of the appellantsand that the first respondent was to hold the amount ‘in trust’ for him.The complaint alleges that the money was transferred to the appellants‘asper the dicta’ of the son of the appellants. There is on the face of thecomplaint, no entrustment of the appellants with any property.

18. The condition necessary for an act to constitute an offenceunder Section 415 of the Penal Code is that there was dishonestinducement by the accused. The first respondent admitted that thedisputed sum was transferred by the son of the appellants to her bankaccount on 17 February 2010. She alleges that she transferred the moneybelonging to the son of the appellants at his behest. No act on part of theappellants has been alleged that discloses an intention to induce thedelivery of any property to the appellants by the first respondent. Thereis thus nothing on the face of the complaint to indicate that the appellantsdishonestly induced the first respondent to deliver any property to them.Cheating is an essential ingredient to an offence under Section 420 ofthe Penal Code. The ingredient necessary to constitute the offence ofcheating is not made out from the face of the complaint and consequently,no offence under Section 420 is made out.19. In Binod Kumar v State of Bihar[7]certain amounts weredue and payable to contract worker. When the amount due was notpaid due to termination of the contract, the worker filed criminalcase against the appellant for criminal breach of trust. The appellants’petition under Section 482 of the Code of Criminal Procedure for quashingwas dismissed by the High Court. two judge Bench of this Courtexamined the ingredients of the offence and whether the complaint onits face disclosed the commission of any offence. This Court quashedthe criminal proceedings holding thus:

“14. At this stage, we are only concerned withthe question whether the averments in thecomplaint taken at their face value make out theingredients of criminal offence or not.

18. In the present case, looking at the allegationsin the complaint on the face of it, we find that noallegations are made attracting the ingredients ofSection 405 IPC. Likewise, there are no

allegations as to cheating or the dishonest intentionof the appellants in retaining the money in orderto have wrongful gain to themselves or causingwrongful loss to the complainant. Excepting thebald allegations that the appellants did not makepayment to the second respondent and that theappellants utilised the amounts either by themselves orfor some other work, there is no iota of allegation as tothe dishonest intention in misappropriating the property…

19. Even if all the allegations in the complaint takenat the face value are true, in our view, the basicessential ingredients of dishonest misappropriationand cheating are missing. Criminal proceedingsare not shortcut for other remedies. Since nocase of criminal breach of trust or dishonestintention of inducement is made out and theessential ingredients of Sections 405/420 IPC aremissing, the prosecution of the appellants underSections 406/120-B IPC, is liable to be quashed.”

20. The suit for recovery of money was institutedby the son ofthe appellants against the first respondent in 2013. The complaint allegingoffences under the Penal Code was filed by the first respondent belatedlyEin 2016. It is clear from the face of the complaint, that no amount wasentrustedby the first respondent to either of the appellants and therewas no dishonest inducement of the first respondent by the appellants todeliver any property. As stated by the first respondent in the complaint,the money belonged to the son of the appellants. It was transferred byFthe appellants’ son to her on his own volition. The money was alleged tohave been returned to the appellants on the instructions of their son. Aplain reading of the complaint thus shows that the ingredients necessaryfor constituting offences under Sections 405, 415 and 420 of the PenalCode are not made out.

G21. The respondents have relied on the decision of this Court inRajesh Bajaj v State of NCT of Delhi[8]. In that case,the Delhi HighCourt had quashed an FIR alleging an offence under Section 420 of thePenal Code on the ground that the complaint did not disclose thecommission of any offence. Allowing the complainant’s appeal, this Courtheld thus:H8 (1999) 3 SCC 259

“9. It is not necessary that complainant shouldverbatim reproduce in the body of his complaintall the ingredients of the offence he is alleging.Nor is it necessary that the complainant shouldstate in so many words that the intention of theaccused was dishonest or fraudulent. Splitting upof the definition into different components of theoffence to make meticulous scrutiny, whetherall the ingredients have been precisely spelled outin the complaint, is not the need at this stage. Iffactual foundation for the offence has been laidin the complaint the court should not hasten toquash criminal proceedings during investigationstage merely on the premise that one or twoingredients have not been stated with details…”The decision does not advance the submission of the firstrespondent. As we have noted above, the complaint in the present caseis bereft of the basic facts necessary to constitute the offences allegedunder Sections 405, 406, 415 and 420 of the Penal Code.

22. Learned Senior Counsel for the appellant contended thatthe actions of the first respondent constitute an abuse of process of thecourt. It is contended that the present dispute is of civil nature and thefirst respondent has attempted to cloak it with criminal flavor to harassthe aged appellants. It is also contended that there is an undue delay infiling the complaint from which the present appeal arises,and thisdemonstrates the mala fide intention of the first respondent in filing thecomplaint against the appellants. Learned Senior Counsel for theappellants relied on the decision of this Court in State of Karnataka vL Muniswamy[9]. In that case, the prosecution alleged that eight of theaccused had conspired to kill the complainant. The Karnataka High Courtquashed the proceedings on the ground that no sufficient ground wasmade out against the accused. three judge Bench of this Court dismissedthe appeal by the State with the following observations:

“7…In the exercise of this wholesome power,the High Court is entitled to quash proceedingif it comes to the conclusion that allowing theproceeding to continue would be an abuse of the

Aprocess of the Court or that the ends of justicerequire that the proceeding ought to be quashed.The saving of the High Court’s inherent powers,both in civil and criminal matters, is designed to achievea salutary public purpose which is that courtproceeding ought not to be permitted toBdegenerate into weapon of harassment orpersecution. In criminal case, the veiled objectbehind lame prosecution, the very nature of thematerial on which the structure of the prosecutionrests and the like would justify the High Court inCquashing the proceeding in the interest of justice.”

23. The jurisdiction under Section 482 of the Code of CriminalProcedure has to be exercised with care. In the exercise of its jurisdiction,a High Court can examine whether matter which is essentially of acivil nature has been given cloak of criminal offence.Where theDingredients required to constitute criminal offence are not made outfrom bare reading of the complaint, the continuation of the criminalproceedingwill constitute an abuse of the process of the court.

24. In the present case, the son of the appellants has instituted acivil suit for the recovery of money against the first respondent. The suitEis pending. The first respondent has filed the complaint against theappellants six years after the date of the alleged transaction and nearlythree years from the filing of the suit. The averments in the complaint,read on its face, do not disclose the ingredients necessary to constituteoffences under the Penal Code. An attempt has been made by the firstrespondent to cloak civil dispute with criminal nature despite theFabsence of the ingredients necessary to constitute criminal offence.The complaint filed by the first respondent against the appellantsconstitutes an abuse of process of court and is liable to be quashed.

25. For the above reasons, the appeal is allowed. The judgmentof the High Court is set aside and the criminal proceedings arising fromGPCR 2116 of 2016 instituted by the first respondent against the appellantsare quashed. We however clarify, that no opinion has been expressedon the merits of the pending civil suit filed by the son of the appellantsfor the recovery of money. The pending suit shall be disposed of inaccordance with the law.

HKalpana K. Tripathy