Summoning order upheld in civil dispute over unpaid goods worth Rs.7,23,711; no abuse of process found under civil procedure rules.

The HC dismissed the application to quash the summoning order in a civil dispute involving non-payment for supplied goods totaling Rs.7,23,711/-. Despite mediation efforts failing, the Court found no illegality in the summoning order. It recognized the financial hardship of O.P. no. 2, a small business, but held that referring the matter to civil court would not constitute an abuse of process. The Court concluded that proceeding through civil litigation, though burdensome, is appropriate, and the summoning order stands.

---

---

1. ISSUES:

1. Whether a summoning order in a complaint alleging an offence under Section 406 IPC can be quashed under the High Court's inherent jurisdiction under Section 482 Cr.P.C. on the ground that the dispute is purely civil.

2. Whether the material on record (including tax invoices, ledger entries and statements recorded under Section 200 Cr.P.C.) demonstrates absence of the requisite criminal ingredient (such as "entrustment" or fraudulent misappropriation) necessary to sustain proceedings under Section 406 IPC.

3. Whether continuation of criminal proceedings would amount to "abuse of the process of the Court" or cause "manifest injustice" justifying exercise of Section 482 Cr.P.C. powers to quash criminal proceedings.

4. Whether the availability of civil remedy and the commercial context of the dispute weigh against criminal prosecution and warrant referral to civil forum instead of permitting criminal proceedings to continue.

2. RULINGS / HOLDINGS:

1. On quashing: The Court refused to quash the summoning order and held that "I see no illegality in the impugned summoning order." The application under Section 482 Cr.P.C. was dismissed.

2. On criminal vs civil character: The Court held that the existence of a contractual/business transaction and the availability of civil remedies do not automatically convert or preclude criminal proceedings, noting that "mere institution of civil proceedings is not a ground for quashing the FIR or to hold that the dispute is merely a civil dispute."

3. On exercise of inherent power: The Court applied the principle that the "inherent power of the High Court Under Section 482 Code of Criminal Procedure should be sparingly used" and concluded that quashing is appropriate only where there would be "manifest injustice" or an "abuse of the process of the Court", and on the facts before it those thresholds were not met.

4. On factual sufficiency to proceed: The Court found that the material indicates goods were supplied and payments ceased since April 2019, producing an outstanding claim which, together with the unsuccessful mediation ("Mediation Completed. No agreement."), justified continuation of criminal proceedings rather than quashing at the threshold.

3. RATIONALE:

1. Legal framework applied: The Court applied the High Court's inherent jurisdiction under Section 482 Cr.P.C., guided by the tests that such power "should be sparingly used" and invoked only to prevent "manifest injustice" or "abuse of the process of the Court." The Court also applied the settled principle that the mere availability of a civil remedy does not preclude criminal prosecution.

2. Precedential principles relied upon: The Court relied on the stated principles that (verbatim) "The inherent power of the High Court Under Section 482 Code of Criminal Procedure should be sparingly used" and that "mere institution of civil proceedings is not a ground for quashing the FIR or to hold that the dispute is merely a civil dispute." These principles informed the threshold for interference with the summons.

3. Application to facts: The Court treated the alleged prolonged non-payment (last payment in April 2019 and an outstanding claim of Rs.7,23,711/- as of filing) and the absence of a mediated settlement ("Mediation Completed. No agreement.") as material facts supporting prima facie criminality sufficient to warrant summons; the potential hardship to the small business complainant if diverted to protracted civil litigation also weighed against quashing.

4. Doctrinal posture: No new doctrinal shift was announced; the decision follows established restraints on exercise of Section 482 Cr.P.C. while emphasizing that commercial context alone does not negate possible criminality and that protection of smaller creditors may justify permitting criminal proceedings to continue.

5. Disposition: The application to quash the summoning order was dismissed for lack of merit. No separate or dissenting opinion was recorded.

---