TaxTMI 
TaxTMI 
2021 (12) TMI 1526
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....and is doing the business of textiles, fabrics, readymade garments. The petitioner states that the company has earned a lot of reputation all throughout the country, the company has entered into commercial transaction with various companies and had never entered into any default and the company believes into maintaining relations. 2.1 The petitioner states that his company has placed some orders from the company i.e. M/s. Oswal Overseas in the end of 2013 and all the transactions with regard to the said transactions were carried out between the company of the petitioner and M/s. Oswal Overseas. During this period the petitioner states that his company has received the goods and had also paid relevant customs duties and taxes at the Customs Department (Customs Duty, Sri Lanka Port Authority Charges (SLPA Charges) AE Charges + D.O. Charges + Yard Rent Charges + Transport Charges + Clearing Agencies Charges) at the Customs Department at Sri Lanka alongwith the invoices sent by M/s. Oswal Overseas. However, on receipt of such invoices, the petitioner company had made part payment to the said company and it is stated that the invoices raised by M/s. Oswal Overseas were amounting to No.....
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.... weavers, and after process of `Dyeing Prints' and `Bal Print', the goods were sent for `work', and after cutting of saree and packing at his shop, the same is sold to the parties directly or through broker(dalal) as per their order. The quality of saree is Reniyel, Georjet and Siphon. 3.1 The complainant states that in the month of March 2012 the petitioner Ashok Jain, had not come through broker(dalal), but had directly come to his Shop No. 133 run as `Ansh Prints' and informed him that the quality of the goods of the complainant was convenient to him and that he wanted those goods and told him that he is doing the business at the office situated at Maayu Import and Export Private Limited, Maayu Impex No. 103, Third Cross Street, Colombo 11, Sri Lanka and he also holds an office at Chennai. 3.2 The accused gave him his visiting card and the complainant showed him the samples. The complainant inquired from the accused about his dealing in the local market, to that the accused gave him the names of `G-Tex' and `Mayur Sarees' at Ring Road, Surat, and said that he was purchasing Sarees from other dealers, too. 3.3 The complainant further states that the accused after 2 or 3 days c....
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....th Rs. 4,46,764/- for some reason could not sent by Vikrambhai Mahendrabhai Barmecha to the accused at Sri Lanka, and as Vikrambhai paid the money of the said goods, he accepted the same, and therefore, he states that total goods valued Rs. 34,71,344/- were sent to the accused. 3.6 The complainant alleges that, in January 2014, within the stipulated period the complainant asked the accused to make the payment, at that time, the complainant complained about some financial crunch, and assured him to make the payment later on. The complainant states that till March 2014 he has sent the goods in accordance to the order of the accused, but, inspite of repeated demand, no payment was made and therefore he himself had gone to Sri Lanka to visit the accused, and at that time, the accused had assured him for payment, and therefore, he returned back to Surat and thereafter he repeatedly called him on mobile phone, the complainant alleges that lastly in the month of March 2016 the accused stopped receiving his calls. 3.7 The complainant has also stated about the business of petitioner with Vikrambhai Mahendrabhai Barmecha of M/s. Oswal Overseas in the FIR and has alleged that the accused ha....
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....e. Learned Senior Advocate for the petitioner submitted that whether any essential ingredients of criminal offence is attracted or not is to be judged by this Court, and if any complaint discloses civil transaction then the remedy available to the parties is to approach the Civil Court for redressal of the dispute. 4.3 Mr. Anshin Desai, learned Senior Advocate for the petitioner further submitted that if the purchase of the goods makes an inferior quality of the material and thereafter to that aspect continuous communications are made, the seller thus admitting to the quality of the goods being inferior would only have to appropriate amount in accordance to the communication. Learned Senior Advocate for the petitioner submitted that civil liability cannot be converted into criminal liability which is absolutely abuse of the process of the court. Learned Senior Advocate for the petitioner submitted that the complaint does not disclose any criminal liability on the part of the accused and thus prayed for quashing of the impugned FIR. 4.4 In support of the argument, learned Senior Advocate for the petitioner has relied upon the following decisions: 1. Anil Kohli v. State (NCT OF D....
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....d the issuance of the same. Learned advocate Ms. Contractor contended that no enterprise like `Saree Sangam' of the accused would exists and thus are concocted invoices, and the petitioner, by way of draft amendment, has made an assertion that he had paid Rs. 9,41,730/-. However, no proof of payment has been submitted. Learned advocate Ms. Contractor suggest that if any payment is to be made beyond Rs. 50,000/- then the same has to be paid by way of banking system and the invoices produced by the petitioner shows cash payment of Rs.5.00 lakhs, which, according to learned advocate Ms. Contractor, would be an offence as would be a hawala transaction. 5.3 Ms. Dilbur Contractor, learned advocate for the respondent No. 2 contended that the FIR unequivocally spells out the misrepresentation made by the petitioner and the manner in which the complainant was deceived and cheated. She submitted that the present petitioner had misrepresented and deceived by portraying himself as a businessman of great repute, by showing his pictures with eminent politicians, and upon his fraudulent promises to regularly pay by way of cheque within 60 to 90 days of receipt of goods, he induced the complainan....
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....hmedabad and therefore detail investigation would be necessary. The documentary evidence with the complainant clearly shows that the complainant had directly transacted with the petitioner for supply of Sarees and it was only supplied through M/s. Oswal Overseas as the complainant did not have export licence. The books of accounts of the complainant with the certificate of Chartered Accountant fortifies the fact that Rs. 39,16,108/- is outstanding in debit side in the name of M/s. Maayu Impex, situated at No. 103, 3rd Cross Street, Colombo, Sri Lanka in the books of account and balance sheet of M/s. Ansh Prints. 5.8 In support of the case, learned advocate for the respondent No. 2 has relied upon the following decisions: 1. M/s. Indian Oil Corporation v. M/s. NEPC India Ltd. and others reported in AIR 2006 SC 2780. 2. Medchl Chemicals & Pharma P. Ltd. v. Biological E. Ltd., and others decided by Hon'ble Supreme Court of India in Criminal Appeal No. 233 of 2000 (Arising out of SLP(Cri.) No. 1971 of 1991) decided on 25.02.2000. 3. Rajesh Bajaj v. State NCT of Delhi and others reported in 1999 Cri.L.J. 1833. 5.9 Ms. Dilbur Contractor, learned advocate for the respondent No. 2 ....
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.... Mr. Pranav Trivedi, learned APP for the respondent-State submitted that, after the complaint, the petitioner was not found by the police team at Chennai (Tamil Nadu), and, according to the police, the petitioner had run away to Sri Lanka. It was found through the complainant that the petitioner-accused whenever visited Surat would have his stay at Austria Hotel at Mahidapura, Surat The police took the copy of passport of petitioner from the said hotel, and found that, on 03.02.2003, the passport was issued from Chennai and from 04.04.2009 to 23.04.2019, the passport came to be issued from Colombo, Sri Lanka, and when it was found that the accused was at Maayu Import and Export Pvt. Ltd., Maayu Impex No. 103, 3rd Cross Street, Colombo-11, an open warrant under Section 70 of the Code of Criminal Procedure was issued against the petitioner and the proceedings was initiated for look out circular and also issued red corner notice. It is stated that the present quashing petition was filed by him, and under the orders of this Court, in the matter on 27.09.2017, 06.04.2019 and 09.06.2019 the statement of the accused was recorded but no arrest has been made of the petitioner-accused. It is....
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....y whisper in the complaint that alleged criminal intimidation administered by the petitioners had caused any alarm to complainant and he actually felt very threatened. The FIR was lodged after two days of the incident and the delay in lodging the FIR was considered to substantiate the fact that alleged criminal intimidation did not cause any alarm, and he did feel any immediate threat to his life and the delay in registering FIR is itself found fatal for the case of the complainant as the same dilute his allegations of being criminality intimidated by petitioners and the dispute was found to be civil in nature; on that ground FIR came to be quashed. It appears that the matter was considered more on the provisions of Sections 503 read with Section 506 of IPC, and for the purpose of non-payment of loan amount and the agreement entered into between the petitioner and the complainant, it was observed that the fact of non-payment of loan amount would have been incorporated in the agreement and there was no clause in the agreement that the amount referred in the FIR remain to be paid by the petitioners. 8.2 In Paramjeet Batra v. State of Uttarakhand and others (supra), the Hon'ble Supr....
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....idow, who was not accompanied by anybody else at the time of the alleged occurrence, and secondly, she, though, being a resident of Delhi, misbehaved with a number of high and mighty parties with whom she had earlier transacted business at Moradabad. These are allegations which on the face of it, cannot be taken seriously by any reasonable person. It was held that the High Court has committed jurisdictional error in dismissing the criminal petition filed by the appellant on the ground that it involves disputed questions of act, which can only be gone into by the trial court. It was held that the utterances which are attributed to the appellant have been inserted in the complaint with a malicious intent to convert a purely civil dispute into a criminal offence. 8.4 In Binod Kumar and others v. State of Bihar and another (supra), the case was considered towards the charge under Section 406 of IPC on the footing whether criminal complaint for criminal breach of trust to have allegedly retained the bill amount payable is liable to be quashed. The dispute relates to non-payment of bill amount pertaining to contract and the bill amount was retained. It was held that the appellant had no....
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....s to be discharged, or of any legal contract, express or implied, which he has made touching the discharge of such trust, or willfully suffers any other person so to do, commits "criminal breach of trust". 9.1 The section could be invoked for criminal breach of trust if the following ingredients gets attracted: (i) a person should have been entrusted with property, or entrusted with dominion over property; (ii) that person should dishonestly misappropriate or convert to his own use that property, or dishonestly use or dispose of that property or willfully suffer any other person to do so; (iii) that such misappropriation, conversion, use or disposal should be in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract which the person has made, touching the discharge of such trust. 9.2 In Chelloor Mankkal Narayan Ittiravi Nambudiri v. State of Travancore, Cochin [AIR 1953 SC 478], the Hon'ble Supreme Court has observed in para 18 as under: ".... to constitute an offence of criminal breach of trust, it is essential that the prosecution must prove first of all that the accused was entrusted with some property o....
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....ere sent to the accused at Sri Lanka. He has also relied upon the invoice bills produced by M/s. Oswal Overseas before him i.e. container bill and the custom clearance bill of the goods. The copy of packing list produced on record shows that the exporter is M/s. Oswal Overseas and the consignee is Maayu Import and Export Pvt. Ltd., No. 103, 3rd Floor, Cross Street, Colombo-11, Sri Lanka, and the said list shows the list of suppliers. Goods are sent under various heads which includes Ansh Prints (saree), Varun Suits (cotton suit), Sanskar Trade (cotton suit), Bindiya Prints (saree), Oswal Overseas (saree), Ram Textiles Prints (cotton suit). The packing list shows the goods by Ansh Prints (sarees) listed as AP 1 to 98. The delivery confirmation for PSM logistics shows the shipper name as M/s. Oswal Overseas with the Container Number and final destination as Colombo, Sri Lanka, with the warehouse name as Punjab Conware. The said packing list shows that the petitioner had purchased the goods from various parties including the complainant under the name of Ansh Prints (saree) and even from M/s. Oswal Overseas. The copy of Certificate of Origin of the Memon Chamber of Commerce shows the ....
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....e agreement would not operate as a bar. 9.6 In International Advanced Research Centre for Powder Metallurgy and New Materials (ARCI) & Others v. Nimra Cerglass Technics (P) Ltd. and another reported in (2016) 1 SCC (Cri.) 269, the Hon'ble Supreme Court in para 13 and 14 has observed as under: "13. In the light of the well-settled principles, it is to be seen whether the allegations in the complaint filed against ARCI and its officers for the alleged failure to develop extruded ceramic honeycomb as per specifications disclose offences punishable under Sections 419 and 420 IPC. It is to be seen that whether the averments in the complaint make out a case to constitute an offence of cheating. The essential ingredients to attract Section 420 IPC are: (i) cheating; (ii) dishonest inducement to deliver property or to make, alter or destroy any valuable security or anything which is sealed or signed or is capable of being converted into a valuable security and (iii) mens rea of the accused at the time of making the inducement. The making of a false representation is one of the essential ingredients to constitute the offence of cheating under Section 420 IPC. In order to bring a ....
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....ed under Section 482 of Cr.P.C., in context of complaint of cheating and criminal breach of trust while observing the factual matrix that the agreement to sell executed between the complainant and the accused, post-dated cheques towards security for performance of agreement handed over by accused, and immediately on receipt of consideration, the accused had cleared her liability of bank and obtained NOC. The said facts were disclosed to the complainant when cheques handed over to complainant as security were rendered invalid. It was observed that the accused had illegally terminated the agreement to sell and therefore it cannot be said that the complaint does not disclose commission of an offence, and the Hon'ble Supreme Court held that, the ingredients of offences under Sections 406 and 420 of IPC are made out. The Hon'ble Supreme Court further held that the allegations is to be proved on the basis of evidence to be led during course of trial and therefore quashing of the proceedings by the High Court was held to be improper. The Hon'ble Supreme Court in para 32, 33 and 34 has observed as under: "32. In the instant case, on a careful reading of the complaint/FIR/charge-sheet, in....
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....iminal prosecution when the disputed act is an offence. Arbitration is a remedy for affording reliefs to the party affected by breach of the agreement but the arbitrator cannot conduct a trial of any act which amounted to an offence albeit the same act may be connected with the discharge of any function under the agreement. Hence, those are not good reasons for the High Court to axe down the complaint at the threshold itself. The investigating agency should have had the freedom to go into the whole gamut of the allegations and to reach a conclusion of its own. Pre-emption of such investigation would be justified only in very extreme cases as indicated in State of Haryana v. Bhajan Lal [1992 Supp (1) SCC 335]." 34. So far as initiation of arbitral proceedings is concerned, there is no correlation with the criminal proceedings. That apart, the High Court has not even looked into the charge-sheet filed against 2nd respondent which was on record to reach at the conclusion that any criminal offence as stated is prima facie being made out and veracity of it indeed be examined in the course of criminal trial." 10. Here in the instant case the petitioner had denied the privity of contra....