ORDER
Hari Shankar Prasad, J.
1. This application has been filed for quashing the entire criminal proceedings including the order dated 31.3.2003 passed in C/1 Case No. 1151/2002, whereby and whereunder the learned Judicial Magistrate, Ist Class, Jamshedpur took cognizance against the petitioners under Sections 387/120-B, IPC.
2. Facts leading to the filing of this application are that the respondent No. 2 informant has lodged an FIR as contained in Annexure 1 stating, inter alia, therein that he is the proprietor of M/s. Vinayak Enterprises and he took some transporting work at Nagpur in the year 1995-96 from the sister concern of Lloyd Steel. The respondent-informant took 12 vehicles/trucks duly financed from Sri Ram Finance Company. All of a sudden due to the slackness in the market, the work allotted to the respondent No. 2 was closed, as such the respondent No. 2 returned all the 12 trucks to the company after plying it for about 11 months. The officer of the company told the respondent No. 2 that they have sold the vehicles in low price and the company was asking to deposit the amount. The company asked the respondent No. 2 to deposit Rs. 95.00 lacs and, thereafter, 65.00 lacs, 40.00 lacks, 20.00 lacs and 14.00 lacs. The company sent a notice to the respondent No. 2 informant to deposit the amount and thereafter a notice was issued by the company for appointment of an arbitrator, which was replied by the respondent No. 2-informant on 2.10.2000,17.2.2001 and 8.3.2001 and the respondent No. 2 informant denied the liability of the company. Thereafter one Mr. Sridhar V. Aiyar sent a telephonic message to the respondent No. 2 informant for settlement of the matter and requested the respondent No. 2-informant to come to Calcutta on 22.5.2001, upon which the informant went to Calcutta for settlement, where it is alleged that said Sridhar V. Aiyar, Mr. Sanjay Jha (Petitioner No. 1) and one D.N. Singh forcibly took a letter from the respondent No. 2 informant to repay Rs. 20.00 lacs to the company. It is further stated that said D.N. Singh told the respondent .No. 2 informant that he is a Mafia and he was also asked him to pay Rs. 10 lacs as “Rangadari” otherwise he will kidnap and kill him. They forcibly took 5 cheques from the respondent No. 2 informant, 4.00 lacs each payable at Jamshedpur. Thereafter the respondent No. 2-informant returned to Jamshedpur. Thereafter the respondent No.2-informant wrote a letter to the Ministry of Finance and here and there and levelled various allegations and paid some money to the company through cheques. After lodging of the FIR, the police investigated the matter and ultimately submitted final form and thereafter a notice was issued to the respondent No. 2 informant on 10.9.2002. The learned CJM accepted the final form submitted by the police and treated the protest petition as complaint case and transferred the case to the Judicial Magistrate, Ist Class, Jamshedpur for enquiry under Section 192(2) Cr PC and thereafter the learned Judicial Magistrate held enquiry under Section 202, Cr PC and took cognizance on the basis of evidence led by respondent No. 2 informant.
3. The learned counsel appearing for the petitioners submitted that as per agreement entered into between the parties, there is a specific clause for appointment of an arbitrator, if there is any dispute, which arises in between the parties and the matter in that circumstance shall be referred to the sole arbitrator for arbitration and on that score alone, the decision taken by the sole arbitrator shall be binding upon the parties. It is further submitted that when the matter settled between the parties regarding payment of amount by the respondent No. 2 informant, the matter was referred to the sole arbitrator and the sole arbitrator sent a notice to the respondent No. 2-informant on 17.12.2001 by fixing the next date on 9.2.2000. Since respondent No. 2 complainant had taken 12 vehicles, hence 12 arbitration cases were referred to the sole arbitrator and in all the arbitration cases notices were properly served upon the respondent No. 2, in which the respondent No. 2 appeared before the sole arbitrator and took time to make enquiry and after giving sufficient opportunity of being heard, the sole arbitrator made an award in favour of the company awarding Rs. 6,00,668.34 paise each plus interest for late payment of rental @ 9% from the date of actual default till the date of realization of the amount. The award in all the arbitration cases have been passed on 28.1.2003. (Annexure 7). It is further submitted that when the respondent No. 2 failed to find out any way to defalcate the amount taken from the company, the respondent No. 2 started writing to the Finance Ministry, Government of India and also by making political pairvi upon the company. However, from the very beginning the respondent No. 2 had dishonest intention to grab the money of the company right from the date of surrender. The company was asking the respondent No. 2 to repay the amount but the respondent No. 2 always avoided making payment. It is further submitted that the respondent No. 2 has adopted pressure tactics so that the company may left its genuine demand and by way of pressure tactics the respondent No. 2 sent a letter to the Finance Minister and other officials and in that way the respondent No. 2 tried his best to overawe the petitioners. It is further submitted that this is a fit case where in order to prevent the abuse of the process of Court, the High Court should exercise its inherent jurisdiction under Article 226 of the Constitution of India and quash the entire proceedings as it is a case of civil nature.
4. On the other hand, learned counsel for the respondent No. 2 submitted that at this stage, when cognizance has been taken after full-fledged enquiry, it will not be desirable to interfere with the findings of the learned Court below, by which cognizance has been taken against the petitioners.
5. From the facts alleged in the complaint petition, it is crystal clear that respondent No. 2 had hired 12 vehicles for transportation for some purpose but due to slackness in the market he returned all the vehicles and the petitioners sold the vehicles at a low price and to that very purpose the petitioners suffered a loss because the respondent No. 2 had plied the vehicles for nearly 11 months and naturally the price of the vehicle will not be like a new vehicle and, therefore, petitioner demanded repayment of the balance amount but instead the respondent No. 2 lodged an FIR with various allegations against the petitioners of threatening, kidnapping and also to kill him and further threatening him to pay Rs. 10.00 lacs as “Rangadari” tax otherwise he will met the consequences but in this connection reliance may be placed upon , where it has been held that higher purchase contract dispute have to be resolved on the basis of terms incorporated in the agreement. As per agreement any dispute, arising out between the parties, was to be referred to a sole arbitrator and the sole arbitrator was appointed in the case and he issued notice to the respondent No. 2 and respondent No, 2 appeared and took time but when sufficient opportunity was given to the respondent No. 2 to place his case, he failed to again appear and then arbitrator passed its award in all the 12 cases on 28.1.2003 and according to that award the respondent No. 2 was to make payment or if he has any grievance then he should have agitated his grievance in a legal way but instead he came out with the allegations. It was also held that where hirer in higher purchase agreement defaults in making instalment and financer took position of the property delivered to hirer under the agreement on the vital element of dishonest intention and, therefore, no case under Section 387/120-B, IPC is made out. Reliance may also be placed upon where purchaser launches criminal prosecution against the financer then dispute raised against financer is purely of civil nature and criminal proceeding initiated was an abuse of the process of Court and deserves to be quashed.
6. Here in the instant case, case is quite different in the sense that respondent No. 2 had taken 12 vehicles for transportation but due to slackness in the market his business failed down and, therefore, he returned all the vehicles but the supplier had to sell those vehicles at a low price because the vehicle were plied for 11 months by the respondent No. 2 and the petitioners requested the respondent No. 2 to make payment of the balance amount then the respondent No. 2 made wild allegation against the petitioners of threatening, kidnapping, ‘killing and demanding “Rangadari” tax etc. and lodged FIR but all the allegations, in the facts and circumstances of the case, appear to be palpably false and in that view of the matter, this application is allowed and the entire criminal proceedings including order dated 31.3.2003 are hereby quashed.