9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2000 (1) TMI 934 - SC - Companies LawApplication filed under Section 482 of the Code of Criminal Procedure to sought quashing of the criminal proceedings pending against them under Section 406/420 of the Indian Penal Code (for short the TPC) in the Court of Chief Judicial Magistrate, Ghaziabad dismissed Held that - Appeal allowed. Agreeing with the submission of the appellants that the whole attempt of the complainant is evidently to rope in all the members of the family particularly who are the parents of the Managing Director or Ganga Automobile Ltd. in the instant criminal case without regard to their role or participation in the alleged offences with a sole purpose of getting the loan due to the Finance Company by browbeating and tyrannizing the appellants of criminal prosecution. A criminal complaint under Section 138 of the Negotiable instruments Act is already pending against the appellants and other accused. They would suffer the consequences if offence under Section 138 is proved against them. In any case there is no occasion for the complainant to prosecute the appellants under Sections 406/420 IPC and in his doing so it is clearly an abuse of the process of law and prosecution against the appellants for those offences is liable to be quashed.
Issues Involved:
1. Quashing of criminal proceedings under Sections 406/420 IPC. 2. Filing of a separate FIR in addition to the complaint under Section 138 of the Negotiable Instruments Act. 3. Role and participation of the appellants in the alleged offences. 4. Abuse of process of law and jurisdiction under Section 482 of the Code of Criminal Procedure. Detailed Analysis: Quashing of Criminal Proceedings under Sections 406/420 IPC: The appellants sought the quashing of criminal proceedings pending against them under Sections 406/420 IPC in the Court of Chief Judicial Magistrate, Ghaziabad. The complaint alleged that the appellants, along with others, fraudulently obtained a loan of Rs. 50,00,000 from the Finance Company, and issued cheques for repayment which were dishonoured due to insufficient funds. The Supreme Court found that invoking the jurisdiction of the criminal court for the alleged offences was an abuse of the process of law. The Court noted that the complainant admitted that the appellants were not Directors of Ganga Automobiles Ltd., and there was no clear evidence of misrepresentation or fraudulent intent by the appellants. Filing of a Separate FIR in Addition to the Complaint under Section 138 of the Negotiable Instruments Act: The complainant had already filed a complaint under Section 138 of the Negotiable Instruments Act before lodging the FIR for offences under Sections 406/420 IPC. The Court observed that there was no explanation as to why the offences under Sections 406/420 IPC were not included in the complaint under Section 138 of the Negotiable Instruments Act. The Court highlighted that the business of a finance company involves commercial transactions, and the issuance of cheques, even if dishonoured, should be addressed under the Negotiable Instruments Act rather than invoking criminal proceedings under IPC. Role and Participation of the Appellants in the Alleged Offences: The investigation revealed that the appellants were not Directors of Ganga Automobiles Ltd. The complainant's counter-affidavit admitted this fact but stated that one appellant was an authorised signatory. The Court found that the complainant's allegations were vague and lacked specific details about the appellants' roles in the alleged fraud. The Court also noted discrepancies in the complainant's statements regarding who initially approached the Finance Company for the loan. The Court concluded that the attempt to involve the appellants, particularly the parents of the Managing Director, was to coerce them into repaying the loan by subjecting them to criminal prosecution. Abuse of Process of Law and Jurisdiction under Section 482 of the Code of Criminal Procedure: The Supreme Court referenced previous judgments (Pepsi Foods Ltd. v. Special Judicial Magistrate, Ashok Chaturvedi v. Shitul H. Chanchani, and others) to emphasize that the High Court has the jurisdiction to quash proceedings under Section 482 of the Code to prevent abuse of the process of law. The Court reiterated that criminal proceedings should not be used as a shortcut for other legal remedies and should be invoked with caution. The Court found that the prosecution of the appellants under Sections 406/420 IPC was an abuse of the process of law, especially when a criminal complaint under Section 138 of the Negotiable Instruments Act was already pending. Conclusion: The Supreme Court allowed the appeal, set aside the judgment of the High Court dated May 6, 1999, and quashed the prosecution of the appellants under Sections 406/420 IPC in Criminal Case No. 674/97 (now Criminal Case No. 6054/98) pending in the Court of Chief Judicial Magistrate, Ghaziabad. The Court concluded that the criminal proceedings were an abuse of the process of law and were initiated to coerce the appellants into repaying the loan.
|
