Gujarat High Court
Dilipkumar Dahyalal Soni vs State Of Gujarat on 16 January, 2025
NEUTRAL CITATION
R/CR.MA/12469/2015 ORDER DATED: 16/01/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/CRIMINAL MISC.APPLICATION (FOR QUASHING & SET ASIDE
FIR/ORDER) NO. 12469 of 2015
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DILIPKUMAR DAHYALAL SONI & ORS.
Versus
STATE OF GUJARAT & ANR.
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Appearance:
MR JANAK D VARDEY(10910) for the Applicant(s) No. 1,2,3
MR.DIPEN F CHAUDHARI(6740) for the Respondent(s) No. 2
MR MANAN MEHTA, APP for the Respondent(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE DIVYESH A. JOSHI
Date : 16/01/2025
ORAL ORDER
1. By way of preferring present application under
Section 482 of the Code of Criminal Procedure, 1973,
the applicants seek to invoke inherent and
extraordinary jurisdiction of this Court for quashing
of the FIR being C.R.No.I-27 of 2015 registered with
Deesa City North Police Station, District Banaskantha
for the offence punishable under sections 406, 420,
504, 506(2) and 114 of the Indian Penal Code and
proceedings of Criminal Case No.1562 of 2015 pending
before the Court of learned Judicial Magistrate First
Class, Deesa.
2. Pursuant to the registration of the aforesaid
FIR, investigation has already been commenced and
ultimately at the end of the day, the investigating
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officer concerned has filed charge-sheet against the
accused persons before the competent Court which
ultimately culminated into Criminal Case No.1562 of
2015.
3. The case of the prosecution in nutshell can be
summarized as under:
3.1. The complainant is goldsmith and indulged in to
the business of jewellery making. He has also
obtained licence from the competent authority to lend
money against the gold ornaments/gold. The applicant
No.1 – original accused No.1 used to come to the shop
of the complainant at regular intervals and
complainant and accused No.1 were having good
relationship since long and on one fine day applicant
No.1 has demanded Rs.5,000/- from the complainant and
complainant lent the said amount with 2% interest and
at that relevant point of time accused No.1 has also
handed over gold ornaments to the complainant and
thereafter at regular intervals the accused No.1 used
to come to the shop of the complainant and after
depositing gold ornaments he used to borrow money
from the complainant. It is alleged that during the
period between 17.09.2011 to 12.10.2023, the accused
No.1 borrowed total amount of Rs.18,00,000/- on 2%
interest by depositing gold and silver jewellery.
The complainant has demanded the said amount time and
again but reasons best known to the accused No.1 he
has not repaid the said amount and at that relevant
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point of time accused Nos. 2 and 3, who happened to
be the real brothers of accused No.1, had earlier
given oral assurance to the complainant that within
no time they arranged for money and repaid it to the
complainant. After lapse of some time, complainant
once again approached to the accused persons and
demanded money but instead of paying the said amount
and fulfilling the promise given to the complainant,
the accused persons administered threats to the
complainant, due to which, complainant was
constrained to register the FIR against all the
accused persons.
4. Heard learned advocate Mr. Janak Vardey for the
applicants and learned APP Mr. Manan Mehta for the
respondent – State.
5. Learned advocate Mr. Janak Vardey submits that
immediately after registration of the FIR, the
applicants have approached before this Court and
considering the allegations and accusations levelled
against the applicants, this Court has granted stay
in favour of the applicants by giving specific
direction to the concerned investigating officer not
to carry out the investigation qua the impugned FIR.
Despite that, the investigating officer has carried
out investigation and filed charge-sheet before the
concerned Court. As soon as the said fact has come to
the notice of the applicants, immediately they
approached before this Court by narrating the said
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fact and therefore the proceedings of Criminal Case
No.1562 of 2015 pending before the learned trial
Court have been stayed by this Court vide order dated
08.10.2015 and since then the trial is pending before
the competent criminal court.
6. Learned advocate Mr. Vardey further submits that
if this Court would go through the recitals of the
allegations levelled in the body of the FIR, in that
event, it would be found out that prima facie there
was no entrustment or dominion over the property of
the complainant. Therefore, bare reading of the
compliant clearly goes no to show that with mala
fide intention to harass the applicants, FIR in
question has been filed by the original complainant
by giving criminal colour to the civil dispute. He
has submitted that it is the specific case of the
complainant from very beginning that accused No.1 had
borrowed money by depositing gold and silver
jewellery before him. Therefore, if at all accused
No.1 failed to repay the said amount within the
prescribed time, in that event, it would be open for
the complainant to recover the said amount by selling
the gold ornaments or by filing a suit for recovery
of the said amount. It is an admitted position of
fact that up till now not a single litigation has
been instituted by the complainant against the
applicant and straight way FIR in question came to be
filed which clearly goes on to demonstrate the arm
twisting tactics adopted by the original complainant
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with a sole intent to rope the applicants in to the
impugned false FIR.
7. Learned advocate Mr. Vardey further submits that
applicant No.3 filed an application in the form of
complaint to the Police Inspector, Deesa City (North)
Police Station, District Banaskantha on 10.11.2014 by
narrating the fact that complainant and two other
persons used to come to his shop and administered
threat and therefore appropriate action is required
to be taken against the said persons. However, no
actions were taken by the police authority.
Thereafter the complainant has continued with his
activity and therefore applicant No.3 was constrained
to give another application on 09.12.2014. Those
applications are part and parcel of the petition.
Learned advocate Mr. Vardey further submits that
despite the fact that the applicant No.3 has made
applications to the Police Inspector concerned to
initiate action against the complainant, no actions
have been taken against him and on the contrary on
one fine day, FIR in question has been filed by the
complainant against him, which is nothing but an arm
twisting tactic on the part of the complainant.
Learned advocate Mr. Vardey further submits that in
fact if the allegations and accusations levelled
against the applicants are to be read, in that event,
it can safely be said that no offence is made out
against the applicants. In fact there was no actual
transaction took place between the applicant Nos. 2
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and 3 and complainant. It is alleged that applicant
Nos. 2 and 3 have given assurance to the complainant
that on a particular day they will bring amount from
accused No.1 and give it back to the complainant and
except that no any specific role is attributed to
them. Learned advocate Mr. Vardey further submits
that it is the settled proposition of law that powers
under Section 482 of the Code can be exercised by
this Court in extraordinary circumstances and looking
to the allegations and accusations levelled against
the applicants in the impugned FIR, this is a fit
case where the Court can exercise its power under
section 482 of the Code. He further submits that if
this Hon’ble Court would make a cursory glance upon
the allegations levelled against the applicants in
the impugned FIR, in that event, it would be found
out that right from the inception the intention of
the applicants was not to deceive and cheat the
complainant since at the time of borrowing the money,
applicant No.1 has given his ornaments to the
complainant as security. He further submits that in
the FIR, no specific averments and allegations with
regard to ill-intention of the applicants to deceive
and cheat the complainant are there. Thus, no offence
is made out against the applicants and applicants are
innocent persons and falsely roped into the criminal
offence. Hence, the FIR in question may be quashed.
In support of his submissions, learned advocate Mr.
Vardey has put reliance upon the following decisions:
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1. In case of Inder Mohan Goswami and another
v. State of Uttaranchal and others, reported in
2008(1) GLH 603;
2. In Arvindbhai Maganlal Master v. State of
Gujarat, 2015(1) GLH 149;
3. In Harjinder Singh Chanchad Singh Sachdev
v. State of Gujarat, 2014 JX (Guj.) 975; and
4. In Arvindbhai Shantilal Modi v. State of
Gujarat, 2014 JX (Guj.) 1004;
8. Learned advocate Mr. Vardey submits that in
view of the ratio laid down by the Hon’ble Apex Court
and by this Hon’ble Court in the aforesaid cases, the
prosecution launched against the present applicants
is required to be quashed and set aside.
9. Learned APP Mr. Manan Mehta appearing for the
respondent – State has objected present application
with vehemence and forcefully submitted that in fact
by making cursory glance upon the body of the FIR,
basic, essential and requisite ingredients to
constitute the offence under Sections 406 and 420 are
clearly established against the accused persons. He
has read the FIR and submitted that pursuant to the
registration of the FIR, investigation has already
been carried out by the investigating officer
concerned and subsequently charge-sheet has also been
filed before the competent Court. During the course
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of investigation, statements of number of witnesses
were recorded by the investigating officer which
clearly goes on to show the active involvement of the
applicants accused persons in commission of crime.
Therefore, no error could be said to have been
committed by the investigating officer to submit
charge-sheet before the competent Court. Therefore,
instant application preferred by the applicants is
required to be quashed and set aside.
10. I have gone through the record and proceedings
and also considered the arguments canvassed by
learned advocates appearing for the respective
parties. Before dwelling into the issue involved in
the matter, at this juncture, I would like to refer
to the observations made by the Hon’ble Apex Court in
the case of Delhi Race Club (1940) Ltd. & Ors. v.
State of Uttar Pradesh & Anr., 2024 INSC 626.
24. This Court in its decision in S.W. Palanitkar
& Ors. v. State of Bihar & Anr. reported in
(2002) 1 SCC 241 expounded the difference in the
ingredients required for constituting an of
offence of criminal breach of trust (Section
406 IPC) viz-a-viz the offence of cheating
(Section 420). The relevant observations read as
under: –
“9. The ingredients in order to constitute a
criminal breach of trust are: (i) entrusting a
person with property or with any dominion over
property, (ii) that person entrusted (a)
dishonestly misappropriating or converting that
property to his own use; or (b) dishonestlyPage 8 of 16
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using or disposing of that property or wilfully
suffering any other person so to do in
violation (i) of any direction of law
prescribing the mode in which such trust is to
be discharged, (ii) of any legal contract made,
touching the discharge of such trust.
10. The ingredients of an offence of cheating
are: (i) there should be fraudulent or
dishonest inducement of a person by 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.”
25. What can be discerned from the above is that
the offences of criminal breach of trust (Section
406 IPC) and cheating (Section 420 IPC) have
specific ingredients. In order to constitute a
criminal breach of trust (Section 406 IPC): –
1) There must be entrustment with person for
property or dominion over the property, and
2) The person entrusted: –
a) dishonestly misappropriated or converted
property to his own use, or
b) dishonestly used or disposed of the property
or willfully suffers any other person so to do
in violation of:
i. any direction of law prescribing the
method in which the trust is discharged; orPage 9 of 16
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ii. legal contract touching the discharge of
trust (see: S.W.P. Palanitkar (supra).
Similarly, in respect of an offence
under Section 420 IPC, the essential
ingredients are: –
1) deception of any person, either by making
a false or misleading representation or by
other action or by omission;
2) fraudulently or dishonestly inducing any
person to deliver any property, or
3) the consent that any persons shall retain
any property and finally intentionally
inducing that person to do or omit to do
anything which he would not do or omit
(see: Harmanpreet Singh Ahluwalia v. State of
Punjab, (2009) 7 SCC 712 : (2009) Cr.L.J.
3462 (SC))
26. Further, in both the aforesaid sections, mens
rea i.e. intention to defraud or the dishonest
intention must be present, and in the case of
cheating it must be there from the very beginning
or inception.
27. In our view, the plain reading of the
complaint fails to spell out any of the aforesaid
ingredients noted above. We may only say, with a
view to clear a serious misconception of law in
the mind of the police as well as the courts
below, that if it is a case of the complainant
that offence of criminal breach of trust as
defined under Section 405 of IPC, punishable
under Section 406 of IPC, is committed by the
accused, then in the same breath it cannot be
said that the accused has also committed the
offence of cheating as defined and explained
in Section 415 of the IPC, punishable
under Section 420 of the IPC.
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28. Every act of breach of trust may not result
in a penal offence of criminal breach of trust
unless there is evidence of manipulating act of
fraudulent misappropriation. An act of breach of
trust involves a civil wrong in respect of which
the person may seek his remedy for damages in
civil courts but, any breach of trust with a mens
rea, gives rise to a criminal prosecution as
well.
xxx xxx xxx
38. If it is the case of the complainant that a
particular amount is due and payable to him then
he should have filed a civil suit for recovery of
the amount against the appellants herein. But he
could not have gone to the court of Additional
Chief Judicial Magistrate by filing a complaint
of cheating and criminal breach of trust.
39. It appears that till this date, the
complainant has not filed any civil suit for
recovery of the amount which according to him is
due and payable to him by the appellants. He
seems to have prima facie lost the period of
limitation for filing such a civil suit.
40. In such circumstances referred to above, the
continuation of the criminal proceeding would be
nothing but abuse of the process of law.
11. For the purpose of constituting the offence of
criminal breach of trust, following ingredients are
required to be established by the prosecuting agency
from the police papers.
1) There must be entrustment with person for
property or dominion over the property, and
2) The person entrusted: –
a) dishonestly misappropriated or converted
property to his own use, orPage 11 of 16
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b) dishonestly used or disposed of the property
or willfully suffers any other person so to do
in violation of:
i. any direction of law prescribing the
method in which the trust is discharged; orii. legal contract touching the discharge of
trust.
11.1.Similarly, for the offence under Section 420
IPC, the essential ingredients which are required to
be established are:
1) deception of any person, either by making
a false or misleading representation or by
other action or by omission;
2) fraudulently or dishonestly inducing any
person to deliver any property, or
3) the consent that any persons shall retain
any property and finally intentionally
inducing that person to do or omit to do
anything which he would not do or omit.
12. It is well settled that in both the aforesaid
sections, mens rea i.e. intention to defraud or the
dishonest intention must be present, and in the case
of cheating it must be there from the very beginning
or inception. As observed by the Hon’ble Apex Court
in the aforesaid decision, ‘with a view to clear a
serious misconception of law in the mind of the
police as well as the courts below, that if it is a
case of the complainant that offence of criminal
breach of trust as defined under Section 405 of IPC,
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punishable under Section 406 of IPC, is committed by
the accused, then in the same breath it cannot be
said that the accused has also committed the offence
of cheating as defined and explained in Section
415 of the IPC, punishable under Section 420 of the
IPC’. 28. It is settled proposition of law that every
act of breach of trust may not be resulted in a penal
offence of criminal breach of trust unless there is
express evidence available on record which clearly
goes on to show that there was manipulating act of
fraudulent misappropriation. An act of breach of
trust involves a civil wrong in respect of which the
person may seek his remedy for damages in civil
courts but, any breach of trust with a mens rea,
gives rise to a criminal prosecution as well.
Admittedly, it is the specific case of the
prosecution that at the time of borrowing the said
amount certain ornaments were handed over by the
accused No.1 to the complainant and all those
ornaments are still lying with the complainant. It is
also required to be noted that the complainant lent
the said amount to the accused No.1 with a view to
earn interest over the said amount. It is also
brought to the notice of this Court by learned
advocate appearing for the applicants that
subsequently applicant No.1 made request to the
complainant that due to certain unavoidable
circumstances, despite his best efforts, he could not
be able to repay the said amount due to scarcity and
shortage of necessary fund and he is not in a
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position to repay the said amount in near future and
therefore whatever ornaments he had given to the
complainant at the time of borrowing the amount, the
price of which came to be escalated, the complainant
has to keep the said gold and silver ornaments within
him and he can utilize the said ornaments as his own
property. The said fact is also found out from the
statements of the accused persons recorded by the
investigating officer. The statement of the accused
persons is also forming part of the present petition.
The statements of witnesses have also been annexed
along with the memo of the petition, which clearly
demonstrate that the intention of applicant No.1 to
cheat the complainant from the inception was also not
there.
13. Thus, this Court is of the considered view that
even if the allegations levelled against the
applicants in the impugned FIR are taken at their
face value and accepted in their entirety, keeping in
view the facts of the present case and the penal
provisions, they do not prima facie constitute any
offence or make out a case against the accused
persons, as per the parameters set out by the Hon’ble
Apex Court in the case of State of Haryana v. Bhajan
Lal, AIR 1992 SC 604 and in the case of R.P. Kapur v.
State of Punjab, AIR 1960 SC 866. If it is the case
of the complainant that a particular amount is due
and payable to him then he should have filed a civil
suit for recovery of the amount against the
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applicants herein but he could not have filed a
complaint of cheating and criminal breach of trust.
It is also found out from the record that till date
the complainant has not filed any civil suit for
recovery of the amount which according to him is due
and payable to him by the applicants.
14. The scope and ambit of inherent powers of the
Court under Section 482 Cr.P.C. or the extra-ordinary
power under Article 226 of the Constitution of India,
now stands well defined by series of judicial
pronouncements. Undoubtedly, this Court has inherent
power to do real and substantial justice, or to
prevent abuse of the process of the Court. At the
same time, the Court must be careful to see that its
decision in exercise of this power is based on sound
principles. The inherent power vested in the Court
should not be exercised to stifle a legitimate
prosecution. However, this Court can exercise its
inherent power or extra-ordinary power if it comes to
the conclusion that allowing the proceeding to
continue would be an abuse of the process of the
Court, or the ends of justice require that the
proceeding ought to be quashed. Thus, considering the
overall facts of the present case as well as the
accusations and allegations levelled against the
applicants in the impugned FIR, I am of the
considered view that the chances of an ultimate
conviction after full-fledged trial are bleak and
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continuation of criminal prosecution against the
applicants accused is merely an empty formality and
wastage of prestigious time of the Court. Thus,
considering the ratio enunciated by the Hon’ble Apex
Court in catena of decisions, I am of the opinion
that the FIR in question deserves to be quashed.
15. In the result, the application succeeds and is
hereby allowed. Accordingly, the FIR being C.R.No.I-
27 of 2015 registered with Deesa City North Police
Station, District Banaskantha for the offence
punishable under sections 406, 420, 504, 506(2) and
114 of the Indian Penal Code and proceedings of
Criminal Case No.1562 of 2015 pending before the
Court of learned Judicial Magistrate First Class,
Deesa, are hereby quashed.
(DIVYESH A. JOSHI,J)
LAVKUMAR J JANI
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