ORDER
P.K. Sinha, J.
1. Learned counsel for the petitioner, for opposite party No. 2, the complainant and learned Additional Public Prosecutor have been heard.
2. This is an application under Section 482 of the Code of Criminal Procedure praying therein to quash order dated 14.2.2001 by which cognizance of offence under Sections 406 and 120-B of the Indian Penal Code had been taken, as well to quash the further prosecution arising out of Complaint Case No. 145(C) of 2001 pending in the Court of Sri S.N. Tiwari, Judicial Magistrate, first class, Patna in so far as it relates to the instant petitioner.
3. The allegations in the complaint at Annexure-2, in brief, are as follows :
4. Accused No. 1 to 8, petitioner being accused No. 2 said to be the Chairman of Hindustan Financial Management. Limited (H.F.M.L. in short) had invited deposits of money from general public in different schemes promising good return who also persuaded the complainant and his wife to make deposits in the Company. On such assertion money was deposited by the complainant and his wife and twenty two certificates were issued, each for Rs. 3,950/- with an assured payment of Rs. 5,000/-on every certificate on maturity, that is, on 15.4.1999.
5. These deposits were made on 15.11.1997 and 26.11.1997. The allegation further is that when in the year 1999 the complainant went to deposit the certificates, he did not find the office of the Company of H.F.M.L. where it was earlier situated whereafter he went to the registered office at New Delhi which office was also not found at the given address.
6. Thereafter, the complainant located the present address and submitted his certificates on 15.4.1999 for which receipts were granted and was assured sending of the money by post which, however, was not done. In the meantime, in May, 1999 the complainant and wife had made further deposits, payable in October and November, 2000 for which cheques in advance were issued which, however, bounced as amount was not sufficient.
7. Sri Y.V. Giri, learned senior Advocate, submitted that the petitioner was the Chairman and was just a name lender, being a prominent personality, to the Company and was not associated with its functioning and had resigned from the post prior to 23.10.1998 on which day an order in the matter of the H.F.M.L. relating to repayment to the depositors was passed by the Company Law Board, Annexure-3, as in that order one D.S. Sachdeva, shown in the complaint as Managing Director of he Company (accused), has been referred to as the Chairman and Managing Director, obviously having replaced the petitioner from the post of Chairman. With the help of Annexure-3, learned counsel submits that it will be clear that the Company had repaid many depositors and had filed a schedule for re-payment of the deposited amounts to different constituents in phased manner and the Company Law Board in its order had also charted out a phased programme for such re-payments and in accordance with that more than once the payments in instalments were offered to the complainant which he refused to accept.
8. Learned counsel for opposite party No. 2 did not dispute the passing of order at Annexure-3 but his grievance was that only once a sum of Rs. 10,000/- was remitted to the complainant which he had refused.
9. A person is said to commit criminal breach of trust if he, being in any manner entrusted with the property, dishonestly misappropriates or converts to his own use that property or disnestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such property is to be discharged.
10. In view of such a definition it has to be inferred from the facts mentioned in the first information report or the complaint or materials collected in course of enquiry or investigation as to whether accused can be said to have such dishonest intention in appropriating property of any other person.
11. It is well settled law, by a catena of decisions, that a prosecution at initial stage or cognizance of an offence can be quashed only in rarest of rare cases. At this stage the Court cannot embark upon an enquiry as to whether or not enough materials have been brought on the record to prove the accused guilty, but if in a complaint a Magistrate finds that there is ground for proceeding further against the accused, he can issue process against him under Section 204 of the Code of Criminal Procedure. There are well settled principles upon which a prosecution at initial stage can be quashed. Such grounds have been enumerated by the Apex Court in the case of State of Haryana v. Bhajan Lal, 1992 Supp. S.C.C. 335, wherein one of the grounds is where the allegations made in the first information report or complaint; even if they are taken at their face value and accepted in their entirety do not, prima facie constitute any offence or make out a case against an accused. In the case of Smt. Nagawwa v. V.S. Konjalgi: (1976) Vol. 3 S.C.C. 736, four specific grounds have been set out in which the order of the Magistrate issuing process in complaint may be quashed. Their Lordships held that the Magistrate, while issuing process against an accused should satisfy himself as to whether the allegations in complaint, if proved, would ultimately end in the conviction of the accused.
12. Learned counsel for the petitioner also relied upon a decision in the case of Alpic Finance Limited v. P. Sadasivan; (2001) 3 S.C.C. 513. The appellant was a registered non-banking Finance Company carrying on business of leasing and hire purchase. The respondents entered into lease agreement with the appellant whereby the appellant agreed to finance the respondents for purchase of one hundred dental chairs. The respondents were not regular in making the payments and committed default and the bank also dishonoured certain cheques issued by the respondents. Some chairs were also found missing. A private complaint was filed against the respondents for having committed offences under Sections 420, 406 and 423 read with Section 120-B of the Penal Code. Their Lordships, in the circumstances of the case, held “to deceive is to induce a man to believe that a thing is true which is false. It must also be shown that there existed a fraudulent and dishonest intention at the time of commission of offence. There is no allegation that the respondents made any wilful misrepresentation. Even according to the appellant, the parties entered into a valid lease agreement and the grievance of the appellant is that the respondents failed to discharge their contractual obligations. In the complaint, there is no allegation that there was fraud or dishonest inducement on the part of the respondents and thereby the respondents parted with the property. It is trite law and common sense that an honest man entering into a contract is deemed to represent that he had the present intention of carrying it out but if, having accepted the pecuniary advantage involved in the transaction, he fails to pay his debt, he does not necessarily evade the debt by deception.” Their Lordships, not discerning any element of deception in the whole transaction, dismissed the appeal.’
13. In the case of Madhavrao v. Sambhajirao, AIR 1988 S.C. 709, the appellants were summoned to face trial on a complaint. Their Lordships of the Supreme Court held in that case that the legal position was settled that when a prosecution at the initial stage was asked to be quashed, the test to be applied by the Court was as to whether the uncontroverted allegations as made, prima facie establish the offence. Their lordships also held that it was for the Court to take into consideration any special features which appeared in a particular case to consider whether it was expedient and in the interest of justice to permit a prosecution to continue. This is so on the basis that the Court can not be utilised for any oblique purpose and when in the opinion of the Court chances of an ultimate conviction were bleak and, therefore, no useful purpose was likely to be served by allowing a criminal prosecution to continue, the Court may, while taking into consideration the special features of a case also quash the proceeding even though it might be at a preliminary stage.
14. Now the facts as obtaining in the case, may be evaluated in view of the well settled principles as elicited in the aforesaid decisions.
15. The undisputed facts I have already stated earlier. H.F.M.L. was admittedly a legally constituted company which invited deposits assuring better returns. Admittedly, the complainant and his wife made certain deposits but the returns were not forthcoming. It is not disputed that order in Annexure-3 was made by the Company Law Board. Question is whether this Annexure-3 can be considered while deciding the instant application.
16. As held by their Lordships in the case of Madhavrao (supra) the Court may consider the facts averred in the complaint as well the special features of the case. If existence of a particular fact is admitted or not disputed by the other side, and which has a bearing upon a just decision in the matter at hand that can be considered. From this order it will appear that H.F.M.L. was a defaulting non-banking Financial Company and this also shows that a huge amount was also paid by the company to its depositors, but defaults also took place. The company had furnished a detailed statement for its failure and also scheme for the payment of outstanding matured deposits. The Company Law Board also prepared a charter for such repayments.
17. It also is not disputed that before this order was recorded by the Company Law Board on 23.10.1998, the petitioner had ceased to be the Chairman of the Company as D.S. Sachdeva was shown as the Chairman and Managing Director of the Company in this Order.
18. As per averments in the complaint itself the date of maturity of the certificates purchased by the complainant at the early stage was 15.4.1999. Obviously, before the certificates became mature for re-payment, the petitioner had ceased to be a part of the Company.
19. The facts averred in the complaint do not show that while the deposits were being accepted there was any intention on the part of the petitioner to deceive the complainant. It has been claimed on behalf of the petitioner that after the order passed by the Company Law Board, some instalments were remitted to the complainant also which he did not accept. On behalf of the complainant remittance of one instalment was accepted.
20. In view of the materials that are on record it is hot possible to discern any dishonest intention on the part of the petitioner while accepting deposit of money from the complainant or his wife, and he obviously ceased to be a part of the company when the amount so deposited matured for re-payment.
21. A prosecution also should not be launched for some oblique purpose. In course of arguments the learned counsel for the complainant had clearly stated that main purpose of the complainant was to realize his money.
22. From the facts on the record it will also appear that there is a bleak prospect of obtaining conviction of the petitioner even if the facts presented in the complaint and by prosecution witnesses remained uncontroverted in the light of admitted position in the case. This coupled with the fact, as already stated, that dishonesty cannot be attributed to the petitioner in the circumstances of the case while the company accepted the deposits, in my opinion makes continuance of criminal prosecution against the petitioner to be the abuse of the process of the Court.
23. This being so, this petition is allowed and impugned order dated 14.2.2001 is hereby quashed in so far as this petitioner is concerned.
24. It is made clear that none of the observations made in this order will in any way be taken to be reflecting upon the merits of the prosecution case, and the defence, so far other accused are concerned, the case against whom will be decided by the learned lower Court on its own merits, in accordance with law.