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2018 (10) TMI 1330 - HC - Indian LawsDishonor of Cheque - re-transfer of shares in Demat Account - misappropriation of shares and money - offence u/s 420 of IPC - Held that - There is no allegation in the complaint against applicants that they made any false representation of any nature to the complainant inviting him to deposit any amount with the company or regarding said transaction, therefore, from the complaint no offence of cheating under Section 420 of IPC is made out against the present applicants. This Court learned JMFC as well as learned XXII Additional Sessions Judge, Bhopal committed mistake in holding that the offence under section 420 of IPC is also made out against present applicants from the complaint. Petition allowed in part.
Issues:
Quashing of Criminal Case-R.T.No.744/2012 under Section 482 of Cr.P.C., Offences under Section 406, 420, 467, 468 read with Section 120-B of IPC, Liability of Applicants Asit C. Mehta Investment Intermediates Ltd. and Jaideep P. Vaidya, Discharge of Applicants from Offences under Section 467, 468, Prima Facie Offences under Section 406, 420, 120-B of IPC, Criminal Breach of Trust, False Representation and Cheating Allegations. Detailed Analysis: Quashing of Criminal Case-R.T.No.744/2012 under Section 482 of Cr.P.C.: The petitioners sought to quash the proceedings of Criminal Case-R.T.No.744/2012 pending before the Judicial Magistrate, First Class, Bhopal. The complaint alleged misappropriation of shares and money by the applicants and co-accused Sudhir Kala. The applicants contended that they were not involved in the transactions and should not be held liable. Offences under Section 406, 420, 467, 468 read with Section 120-B of IPC: The complainant accused the applicants and Sudhir Kala of misappropriating shares and money. The lower courts took cognizance against the applicants for offences under various sections of the IPC. The applicants argued that they were not involved in the transactions and should not be held liable for the alleged misappropriation. Liability of Applicants Asit C. Mehta Investment Intermediates Ltd. and Jaideep P. Vaidya: The applicants, a stockbroking company and its compliance officer, denied involvement in the disputed transactions. They claimed that the transactions were carried out by Sudhir Kala without their knowledge or consent. The complainant alleged that the applicants were complicit in the misappropriation. Discharge of Applicants from Offences under Section 467, 468: The Additional Sessions Judge discharged the applicants from offences under Section 467, 468, observing that prima facie only offences under Section 406, 420, 120-B of IPC were made out. The case was remanded to the Chief Judicial Magistrate for trial under these offences. Prima Facie Offences under Section 406, 420, 120-B of IPC: The court found that the complainant's accounts were managed by the applicants and Sudhir Kala. The complainant alleged unauthorized transactions and misappropriation of shares and money. The court held that prima facie offences under Section 406, 420, 120-B of IPC were made out against the applicants. Criminal Breach of Trust: The court noted that the offence of criminal breach of trust was established when the applicants sold shares from the complainant's demat account without permission. The subsequent re-depositing of shares did not absolve the initial breach of trust committed by the applicants and Sudhir Kala. False Representation and Cheating Allegations: The court found no allegations in the complaint against the applicants regarding false representation or cheating. Therefore, the offence of cheating under Section 420 of IPC was not made out against the present applicants. The court held that the lower courts erred in holding that the offence under Section 420 of IPC was made out against the applicants. Conclusion: The court partly allowed the petitions, setting aside the order regarding the offence under Section 420 of IPC. The trial court was directed to proceed with the case for other offences as directed by the Additional Sessions Judge. The court emphasized the need for expeditious disposal of the pending case, which had been ongoing since 2012.
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