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TMI Blog2021 (4) TMI 780X X X X Extracts X X X X X X X X Extracts X X X X ..... transaction. No prima facie case of criminal intent at the inception having been made out against the petitioners in the complaint, it can be held that no criminal offence, far less an offence under section 420/406 of the Penal Code is disclosed in the complaint and allowing the proceedings to continue shall amount to abuse of the process of law - application allowed. - C.R.R. No. 3058 of 2019 CAN 1 of 2020 (Old CAN 930/2020) - - - Dated:- 25-3-2021 - Hon ble JUSTICE SUVRA GHOSH For the Petitioners : Mr. Ayan Bhattacharya, Adv. Mr. A.Basu, Adv. Mr. Pratik Shanu, Adv., For the Opposite Party No.2: Mr. R.K Ghosal, Adv. Mr. R. Adhikary, Adv. Mr. Mrinal Das, Adv., SUVRA GHOSH, J. :- 1. In the instant application under section 482 of the Code of Criminal Procedure the petitioners have prayed for quashing of the proceedings of complaint case no. C.S. / 21563 of 2019 under section 406/420/120B of the Penal Code pending before the Learned Metropolitan Magistrate, 19th Court, Calcutta. 2. The contention of the petitioners, in a nutshell, is that opposite party no. 2 filed a complaint before the Learned Chief Metropolitan Magistrate, Calcutta on 28-05-2019 sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Penal Code. Learned counsel has placed reliance on the authorities in Madhavrao Jiwaji Rao Scindia v/s. Sambhajirao Chandrojirao Angre reported in AIR 1988 Supreme Court 709, Shiv Kumar Jatia v/s. State of NCT of Delhi reported in AIR 2019 Supreme Court 4463 and Suresh Kumar Goyal v/s. State of Uttar Pradesh reported in AIR 2019 Supreme Court 535 i n support of his contention. He has also used supplementary affidavit to produce certain documents and has prayed for quashing of the proceedings. 5. Learned counsel appearing for the opposite party has vehemently opposed the contention of the petitioners and has submitted that it shall appear from the financial statement of the petitioner company for the year ended 31st March, 2015 that the equity shares in question stood in the name of the opposite party. It is strange that such shares of the opposite party were suddenly missing from the record of the petitioner company subsequently. It is a fact that some amount was transferred to the account of the opposite party but such transfer was disputed by the opposite party by way of communication with the bank. Drawing the attention of the court to section 56(1) of the Companie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be deceiving him; (ii)(a) the person so deceived should be induced to deliver any property to any person, or to consent that any person shall retain any property; or (b) the person so deceived should be intentionally induced to do or omit to do anything which he would not do or omit if he were not so deceived; and (iii) in cases covered by (ii)(b), the act of omission should be one which causes or is likely to cause damage or harm to the person induced in body, mind, reputation or property . { S.W. Palanitkar v. State of Bihar 2002 SCC (Cri) 129 .} 10. Section 406 of the Penal Code deals with punishment for criminal breach of trust, which is defined in section 405 and is set out:- 405. Criminal breach of trust.- Whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied, which he has made touching the discharge of such trust, or wilfully suffers any other person so to d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ous entry in the bank account of the opposite party prima facie suggests that the amount was in lieu of transfer of the equity shares in question, 27,000 in number, valued at ₹ 10/- per share. 15. Learned advocate for the opposite party has drawn the attention of the court to section 56(1) of the Companies Act, 2013 which states that A company shall not register a transfer of securities of the company, .........other than the transfer between persons both of whose names are entered as holders of beneficial interest in the records of a depository, unless a proper instrument of transfer, in such form as may be prescribed, duly stamped, dated and executed by or on behalf of the transferor and the transferee .......... has been delivered to the company ....... . . In the present case, as alleged transfer of shares was between a shareholder and one of the directors of the same company, such instrument does not appear to be mandatory. 16. It is trite law that jurisdiction of the court under section 482 of the Code ought to be exercised with extreme care, caution and circumspection and should not be used to stifle or axe down a legitimate prosecution. The test is whether t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsel for the petitioners which deal with issuance of duplicate share certificates, procedure therefor and remedy for non issuance of the same. These provisions do not require discussion in the present case as the same does not fall within the ambit of application under section 482 of the Code. It is held, even at the cost of reiteration, that mere insertion of sections 420/406 of the Penal Code in the complaint does not by itself make out a prima facie case under the said provisions of law and it is the substance of the complaint which has to be looked into. No prima facie case of criminal intent at the inception having been made out against the petitioners in the complaint, I am inclined to hold that no criminal offence, far less an offence under section 420/406 of the Penal Code is disclosed in the complaint and allowing the proceedings to continue shall amount to abuse of the process of law. 20. In the result, CRR 3058 of 2019 is allowed. 21. Connected application being CAN 1 of 2020 (Old CAN 930/2020) is disposed of. 22. Proceedings of complaint case no. C.S./ 21563 of 2019 under section 406/420/120B of the Penal Code pending before the Learned Metropolitan Magistrate, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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