CRM-M-37409-2014 -1-
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
CRM-M-37409-2014 (OM)
Date of decision: 17.08.2018
Balwinder Kumar
… Petitioner
Vs.
M/s R.N. Highways (P) Ltd.
… Respondent
CORAM: HON’BLE MR. JUSTICE ARVIND SINGH SANGWAN
Present: Mr. A.D.S. Sukhija, Advocate
for the petitioner.
Mr. Raghav Gulati, Advocate for
Mr. Bhupinder Ghai, Advocate
for the respondent.
*******
ARVIND SINGH SANGWAN, J. (ORAL)
Prayer in this petition is for quashing of criminal complaint
No.11154 of 05.06.2008 titled as R.N. Highways (P) Ltd. Vs. Balwinder
Singh and others (Annexure P-1) and the summoning order dated 24.08.2009
(Annexure P-2), vide which the petitioner has been summoned to face the
trial under Section 406 of the Indian Penal Code (for short ‘IPC’).
Brief facts of the case are that the respondent-complainant
(hereinafter referred as ‘complainant’) filed the aforesaid complaint in the
year 2008 against petitioner Balwinder Kumar, Recovery Manager of HDFC
Bank (for short ‘Bank’) along with J.P. Singh, Regional Manager, Rajesh
Bhatia, Manager Legal Cell and one Tarun Likha, Manager of the Bank,
Branch Sector-8, Chandigarh under Sections 390, 392, 403, 406, 420, 424,
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426, 427 IPC with the allegations that the complainant is Director of R.N.
Highways Pvt. Ltd. and is authorized to file the complaint by virtue of
resolution dated 16.05.2008. The complainant-company had purchased a
machine Tata Hitachi Ex-110 by availing the loan/finance from the Bank.
Later on, due to financial problem of the complainant-company, installments
of the loan amount could not be paid and on 30.01.2008, the petitioner along
with other accused named in the complaint, who were employees of the
Bank, had taken possession of the aforesaid machine in a reckless manner
and the same was kept in the stock yard under their supervision. Thereafter,
the complainant lodged the complaint with the police where conciliation
efforts were made. The accused persons produced a letter dated 20.08.2006
given by Kamal Kant Puri, authorized representative of complainant,
requesting the Bank to take possession of the machine. It is further stated that
said Kamal Kant Puri had misappropriated the company’s asset. Later on, a
Memorandum of Settlement was effected between the Bank and the
complainant and as per the settlement (Annexure P-3), the complainant paid
an amount of Rs.13,75,000/- to the Bank on 14.03.2008 as full and final
payment towards the loan amount and the Bank issued receipts dated
17.03.2008. The Bank further issued a release memo in respect of the
machine, addressed to M/s Sanjeev Goel, Stock Yard, Panchkula on
20.03.2008. It is further stated on 21.03.2008, the complainant was allowed
to inspect the machine along with an Engineer and found that some vital parts
of the machine are missing and there are dents and damage due to careless
mishandling. A list of damages and deficiencies was prepared and given to
the petitioner, however, there was no response. Later on, the complainant
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approached Mr. J.P. Singh, Regional Manager of the Bank and gave a
complaint dated 03.04.2008 and the complainant was assured that needful
will be down within 72 hours. Thereafter, the complainant-company issued a
notice dated 20.04.2008 but there was no response from the accused persons.
It is further stated in the complaint that since the complainant is suffering loss
of earning of Rs.7,000/- per day, which amounted to Rs.7.00 lacs, w.e.f.
30.01.2008 onwards, thus, it was prayed that the accused be summoned and
punished according to law.
After the complainant led its preliminary evidence, in which the
complainant appeared as CW1 and proved on record the settlement as Ex.C2,
the trial Court vide impugned order dated 24.08.2009 (Annexure P-2)
summoned the petitioner under Section 406 IPC only, however, no
summoning order was passed against accused No.2 to 5, other office bearers
of the Bank. The trial Court relied upon Clauses 1 3 of the settlement
Ex.C2, where it was specifically mentioned that the Bank shall keep the
machine in its trust and good condition and shall return the same to the
complainant in the same good condition, in which it is being taken into trust.
This petition was filed in the year 2014 and vide order dated
03.11.2014, further proceedings before the trial Court were stayed.
Learned counsel for the petitioner has submitted that at the time,
when the loan was obtained by the complainant, the petitioner was not a
signatory and he is only a signatory to the settlement Ex.C2 and in response
to the said settlement, the Bank has offered to hand over possession of the
machine to the complainant and it is the vicarious liability of the Bank, who
has entered into the settlement with the complainant. It is further submitted
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that the complainant had inspected the machine and thereafter, he had entered
into the settlement and the Bank consistently requested the complainant to
take possession of the machine, but he denied. Counsel for the petitioner has
further submitted that even the complainant has filed a suit for mandatory
injunction praying for a decree to direct the Bank/its officials to hand over
the possession of the machine in perfect working condition and vide
judgment dated 20.01.2016, the Civil Court dismissed the suit by making the
following observations: –
“The plaintiff has also relied upon the evidence of PW-2
Amrinder Singh. Though, he had tendered in evidence his
affidavit when the plaintiff had a chance to lead evidence, but
did not again step into the witness box for the purpose of cross-
examination and the evidence of the plaintiff was closed by the
orders of the Court. However, he again stepped into the witness
box during rebuttal evidence, which was objected to by the
counsel for the defendants before the cross-examination. Since
in the rebuttal evidence the plaintiff can only be allowed to lead
evidence on the issues the onus of which was upon the
defendants, and therefore, his affidavit during rebuttal evidence
cannot be read in evidence particularly when he failed to
appear for cross-examination when the plaintiff had a chance to
lead evidence in affirmative. Even otherwise, his cross-
examination is very vital wherein he had stated that he does not
have any proof regarding his presence on the spot or in the
police station as mentioned by him in the affidavit. He had not
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CRM-M-37409-2014 -5-signed any of the documents relied upon by the plaintiff alleged
to have been executed on 30.1.2008 when the machine was
confiscated by the defendant bank. He has never been named in
the plaint to have been present on the said date and his evidence
appears to be only an afterthought just to fill up the lacuna in
the present case. Moreover, he has specifically deposed in the
cross-examination that he does not have any proof to show that
there is any difference in the condition of the machine when it
was picked up and when the release order of the same was
issued by the bank on 20.3.2008. He has further deposed that he
cannot tell if here is any mechanical or technical defect in any
machine or vehicle. Therefore, the fact remains that the oral
evidence relied upon by the plaintiff is not trustworthy and the
Director of the plaintiff company namely Mohinder Singh
through whom the present suit has been filed, has not stepped
into the witness box and an adverse inference in this regard is to
be raised against the plaintiff.
Much reliance has been placed by learned counsel for the
plaintiff on the documents Ex.PE and Ex.PF. At the very outset,
it is pertinent to observe here that firstly the original of these
documents have never seen the light of the day and it is a settled
law that a photocopy of the document is not admissible in
evidence. Learned counsel for the plaintiff has stated that the
execution of Ex.PF has not been denied by the defendants. Even
in such a scenario the contents of the said documents are
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CRM-M-37409-2014 -6-inadmissible in evidence only being a photocopy thereof as it is
only the execution which has been admitted, but the contents
thereof have nowhere been admitted by the defendants.
Moreover, a perusal of the said document nowhere suggests that
the machine was in working condition at the time when the same
was confiscated by the defendant bank on 30.1.2008. The same
only refers to the fact that the machine was in a good condition.
However, the same is a relative term and it nowhere raises a
presumption that the machine was in a working condition on the
said day. Moreover, the plaintiff has also failed to prove that the
machine was not in working condition on the day the release
memo was issued to him by the defendant bank. As far as the
document Ex.PE is concerned, the same is also a photocopy of
document and even otherwise the same has been nowhere
purported to have been signed by any of the official of the
defendant bank. Therefore, in these circumstances, I am of the
considered opinion that the plaintiff has miserably failed to
prove the allegations leveled by it in the plaint, and as such,
both these issues are decided against the plaintiff and in favour
of the defendants.
ISSUE NO.3.
The plaintiff has filed the present suit for mandatory
injunction and recovery of losses suffered by it. Although, the
plaintiff has failed to prove its case on merit, but the same is
maintainable under the provisions of Specific Relief Act, 1963
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CRM-M-37409-2014 -7-and Section 9 of Code of Civil Procedure, 1908. This issue is,
therefore, decided in favour of the plaintiff an against the
defendants.
ISSUE NO.4.
The plaintiff has filed the present suit for mandatory
injunction and recovery of losses suffered by it. Though, in the
head note of the plaint and the relief clause, the plaintiff has not
stated the amount which is sought to be recovered in view of the
losses suffered by him as alleged in the plaint, but in Para no.
23(ii) of the plaint, he has quantified the alleged losses to the
tune of Rs. 43,37,500/-. The plaint is to be read in its entirety
and merely because no amount has been written in the head
note and the relief clause of the plaint and particularly when the
alleged losses have been quantified by him in Para no. 23(ii)of
the plaint, is no ground not to file the ad-valorem court fee.
Therefore, the suit is to be valued on the relief of recovery of Rs.
43,37,500/- for the purposes of court fee and jurisdiction.
However, the plaintiff has only affixed the court fee of Rs.35/-,
and is liable to pay the ad-valorem court fee on the amount of
recovery, but has failed to pay the same. Therefore, this issue is
decided against the plaintiff and in favour of the defendants.
RELIEF.
Thus, in view of my findings made on the issues supra, the
suit of the plaintiff fails and the same stands dismissed with no
order as to costs.”
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CRM-M-37409-2014 -8-Learned counsel for the petitioner has argued that process of
advancement of loan, its repayment and taking the possession of the machine
was done by the Bank, which is not arrayed as an accused and only role
assigned to the petitioner was that he was a signatory to the Memorandum of
Settlement. It is further argued that the trial Court has summoned the
petitioner only under Section 406 IPC and no other official of the Bank was
summoned in this regard. Learned counsel has further argued that from the
bare perusal of the complaint and the statement of the complainant, no
offence under Section 406 IPC is made out against the petitioner.
Learned counsel for the petitioner has relied upon Anup
Sarmah Vs. Bhola Nath Sharma and others, 2013 (1) RCR (Crl.) 62, in
which the Hon’ble Supreme Court has held as under: –
“In view of the above, the law can be summarised that in an
agreement of hire purchase, the purchaser remains merely a
trustee/bailee on behalf of the financier/financial institution and
ownership remains with the latter. Thus, in case the vehicle is
seized by the financier, no criminal action can be taken against
him as he is re-possessing the goods owned by him.
If the case is examined in the light of the aforesaid settled
legal proposition, we do not see any cogent reason to interfere
with the impugned judgment and order. The petition lacks merit
and, accordingly, dismissed.”
Learned counsel for the petitioner has further relied upon a
judgment of the Hon’ble Supreme Court in Sharad Kumar Sanghi Vs.
Sangita Rane, 2015 (2) RCR (Crl.) 120, to submit that where the allegations
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are pertaining to the Managing Director or any officer of the Company and
the complaint is filed only against the officials, by not impleading the
company, in the absence of any specific allegation against the officials,
complaint is liable to be quashed.
Learned counsel has also relied upon S.K. Alagh Vs. State of
U.P. and others, 2008 (2) RCR (Crl.) 79, where the allegations against the
company were made under Section 406 IPC and the complaint was filed
against the Managing Director of the Company and the Company was not
arrayed as an accused, the proceedings were quashed.
Learned counsel for the petitioner has also relied upon M/s
GHCL Employees Stock Option Trust Vs. M/s India Infoline Limited,
2013 (2) RCR (Crl.) 519, wherein the Hon’ble Supreme Court has held that
breach of trust or cheating are both civil wrong as well as criminal offence
and under certain situations, where the act alleged would predominantly be a
civil wrong, such an act does not constitute a criminal offence.
Learned counsel for the petitioner has lastly argued that in view
of the judgment of the Hon’ble Supreme Court in Dhariwal Tobaco
Products Ltd. and others Vs. State of Maharashtra and another, 2009 (1)
RCR (Crl.) 677, the petitioner though has a remedy of filing revision petition
against the summoning order under Section 397 Cr.P.C. yet can also file a
petition under Section 482 Cr.P.C. as alternative remedy and the petition filed
under Section 482 Cr.P.C. cannot be dismissed only on the ground that
remedy of revision was available to the accused persons.
In reply, learned counsel for the respondent has argued that from
the bare perusal of the complaint, offence under Section 406 IPC is made out
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against the petitioner, as he being the representative of the Bank, had entered
into the settlement and promised to keep the machine in its trust and good
condition. The petitioner had further undertaken that the machine shall be
returned in the same good condition, in which it has been taken in trust. It is
further submitted that in pursuance to the Memorandum of Settlement, the
complainant has performed his part of the settlement and has paid the entire
loan amount and when he had gone to inspect the machine on 21.03.2008, he
found that vital parts of the machine were missing and some parts are
replaced with junk and there is damage to the machine. It is also submitted
that despite issuance of a notice and assurance given by the Bank, the
machine was not restored to its original condition and therefore, prima facie
offence under Section 406 IPC is made out and the trial Court has rightly
summoned the petitioner, as he was the official incharge of the Bank, on
whose representation, the complainant deposited the entire loan amount,
trusting that the machine will be restored to its original condition.
Learned counsel has further submitted that till date, despite a
period of more than 10 years has been passed, the machine is still lying with
the Bank and the complainant has already filed an appeal challenging the
aforesaid Civil Court judgment dated 20.01.2016, vide which the civil suit for
mandatory injunction filed by the complainant, was dismissed.
After hearing learned counsel for the parties, I find merit in the
present petition, for the following reasons: –
(a) Admittedly, the petitioner is an employee of the Bank and the
Bank is not arrayed as an accused in the complaint. As per own
case of the complainant, it had obtained the loan from the Bank
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CRM-M-37409-2014 -11-and after having failed to repay the same, possession of the
machine was taken by the Bank. It is only subsequent thereto,
when the talks for some settlement were there between the parties
and the Memorandum of Settlement was arrived at between
them, the petitioner, being an official of the Bank, had signed the
same on behalf of the Bank and therefore, the vicarious liability,
if any, is of the Bank, who is not arrayed accused in the
complaint.
(b) There is no allegation in the complaint that the petitioner is
incharge of the yard, where the machine is lying and even there is
no allegation that the petitioner had removed vital parts of the
machine. In the absence of any such allegation in the complaint,
or in the statement of the complainant, the petitioner alone cannot
be held guilty to have committed the offence under Section 406
IPC remotely, especially when the Bank is not arrayed as an
accused. Therefore, in view of judgment of the Hon’ble Supreme
Court in Sharad Kumar Sanghi’s case (supra) and S.K. Alagh’s
case (supra), the prosecution of the petitioner is not maintainable.
(c) Even otherwise, from the bare perusal of the complaint, offence
of criminal breach of trust is not made out. It has been held by the
Hon’ble Supreme Court in Ashok Basak Vs. State of
Maharashtra and others, 2014 (4) RCR (Crl.) 789 that in order
to prove the offence of criminal breach of trust, the complainant
should satisfy that the accused was entrusted with the property or
entrusted with dominion over the property; secondly that such
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CRM-M-37409-2014 -12-person has dishonestly misappropriated or converted to his own
use of that property or dishonestly used or disposed of the
property or willfully suffered any person to do so; and thirdly,
such misappropriation, conversion, use or disposal was in
violation of any direction of the 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 the trust.
Therefore, it is apparent that there are no allegation against the
petitioner that he was entrusted with the machine, which was
taken into possession by the Bank and it is also not the case of
the complainant that the petitioner was entrusted with dominion
over the property. The complaint also does not reveal the second
and third condition as the machine is lying in the yard of the
Bank and therefore, the petitioner has not dishonestly
misappropriated any property of the complainant, as he was
discharging his job as an official of the Bank and only allegation
against him is that he was signatory to the Memorandum of
Settlement.
(d) In view of the judgment of the Hon’ble Supreme Court in V.Y.
Jose and another Vs. State of Gujarat and another, 2009 (1)
RCR (Crl.) 869, the primary dispute between the complainant
and the petitioner is with regard to return of the machine, in the
condition, in which its possession was taken and qua this, the
complainant had already filed a civil suit for mandatory
injunction, which stands dismissed at first instance and therefore,
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CRM-M-37409-2014 -13-primarily, the dispute is of civil nature, as the complainant can
claim the relief of mandatory injunction as well as can seek
compensation from the Bank, in accordance with law.
(e) Though the petitioner has levelled allegations against four
officials, however, the trial Court has summoned only the
petitioner to face the trial and the complainant has not challenged
the summoning order qua other officials, against whom, there are
similar allegations, as against the petitioner. Even otherwise,
though the complainant has filed the complaint under various
Sections of the Indian Penal Code, the trial Court has summoned
the petitioner only under Section 406 IPC and from a bare perusal
of the complaint, the ingredients of Section 406 IPC are not made
out, as the Bank had repossessed the vehicle in accordance with
law.
(f) The arguments raised by counsel for the respondent that the
petitioner has alternative remedy of filing the revision petition
before the Court of Sessions, at this stage, when the present
petition is pending for the last 04 years and the proceedings were
stayed, cannot be entertained, as even otherwise, in view of the
judgment of the Hon’ble Supreme Court in Dhariwal Tobaco
Products Ltd.’s case (supra), present petition cannot be
dismissed only on this account.
(g) In view of the judgment of the Hon’ble Supreme Court in M/s
GHCL Employees Stock Option Trust’s case (supra), it is
apparent that dispute between the complainant and Bank is
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CRM-M-37409-2014 -14-predominant qua civil wrong and therefore, the act on behalf of
the petitioner being an official of the Bank, does not constitute a
criminal offence.
For the reasons stated above, present petition is allowed. The
criminal complaint No.11154 of 05.06.2008 titled as R.N. Highways (P) Ltd.
Vs. Balwinder Singh and others (Annexure P-1) and the summoning order
dated 24.08.2009 (Annexure P-2) are hereby quashed.
[ ARVIND SINGH SANGWAN ]
17.08.2018 JUDGE
vishnu
Whether speaking/reasoned : Yes/No
Whether Reportable : Yes/No
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