Without mincing any words whatsoever and without beating about the bush, the Delhi High Court on June 10, 2022 in an extremely learned, laudable, landmark and latest judgment titled Yogesh Jagia v. Jindal Biochem Pvt Ltd in CRL.M.C. 2349/2014 & CRL.M.A.7900/2014 and cited in 2022 LiveLaw (Del) 562 has observed unequivocally that summoning of an accused in a criminal case is a serious matter and that the criminal law cannot be set into motion as a matter of course. It must be mentioned here that the Single Judge Bench of Justice Chandra Dhari Singh further added that a Magistrate is the silent spectator at the time of recording of preliminary evidences before summoning of the accused and must carefully scrutinize the evidence brought on record and may even himself put questions to the complainant and his witnesses to elicit answers to find out the truthfulness of the allegations or otherwise and then examine if any offence is prima facie committed by all or any of the accused. The Court was dealing with a plea that was filed by a practicing advocate who was enrolled with the Bar Council of Delhi since 1991 and the Respondent Complainant was a real estate development company.
To start with, this brief, brilliant, bold and balanced judgment authored by a Single Judge Bench of the Delhi High Court comprising of Justice Chandra Dhari Singh sets the ball rolling by first and foremost putting forth in para 1 that, “The instant petition under Section 482 of the Code of Criminal Procedure, 1973 (hereinafter “Cr.P.C.”) has been filed on behalf of the petitioner seeking following prayer:-“(i) Pass an order allowing present petition and quashing the summoning order dated 27.11.2013, qua the petitioner, issued in complaint case No. 149/1/12 by Ms Purva Sareen, Metropolitan Magistrate-01/south/ Saket Court, New Delhi…””
What next follows is that the Bench then points out in para 2 that, “The Petitioner is a practicing Advocate enrolled with Bar Council of Delhi since 1991 and the Respondent/Complainant is a real estate development company.”
To recapitulate, the Bench then vividly recalls in para 3 that, “In 2005, four promoters of complainant company, namely, Rajinder Kumar Jindal, Attar Singh, Kartar Singh and A.P. Singh, jointly promoted ‘V4 Infrastructure Pvt Ltd’ (hereinafter “V4”). Prior to incorporation of V4, to avail opportunity to bid commercial plot of land at Karkardooma, all the four referred promoters contributed funds in complainant company and acquired a commercial plot of land at Karkardooma Community Center, Delhi from DDA, which was subsequently developed by V4 in terms of development agreement dated 24th February, 2005.”
In hindsight, the Bench then further recalls in para 4 that, “In 2008, certain disputes arose between the promoters and consequently, two of the promoters exited the V4, selling their equity shares to the remaining promoters, that is, Rajinder Kumar Jindal and Attar Singh. Thereafter, Rajinder Kumar Jindal also exited V4 and sold his shares to Attar Singh. Share purchase agreements were drawn up and as part of settlement, part of commercial property located at Plot No. 228, Sector - 9, Dwarka, developed by V4, was agreed to be sold to complainant company for an agreed consideration for which two separate space buyer agreements were executed between the complainant and V4, both dated 7 th October, 2009. For execution of the agreements, the petitioner herein was appointed. For the settlement of disputes, two conveyance deeds, one in favour of V4 for property at Karkardooma, as per development agreement dated 24th February, 2005, and another for part of Dwarka property as per space buyer agreements dated 7th October, 2009 by V4 in favour of complainant company, were executed. Both the said entities on verbal request created an escrow account with the petitioner.”
As we see, the Bench then discloses in para 5 that, “V4 subsequently agreed to hand over possession letters for Dwarka property in escrow account but same were not deposited due to noncompliance by complainant Company of the agreed terms, though complainant alleged that same were handed over but illegally released by Petitioner herein to Accused no.2 and 3.”
It deserves mentioning that the Bench then mentions in para 6 that, “In 2010, the complainant confirmed the creation of escrow account vide letter dated 23rd July, 2010 and the petitioner admitted the documents mentioned in the referred letter except the possession letters. The documents kept in the escrow account were reconfirmed by the complainant in its letter dated 21st May, 2011.”
Quite damningly, the Bench then observes in para 7 that, “It is the case of the complainant that the accused no. 1, petitioner herein, in collusion with accused no. 2 and 3 made alterations in the space buyers agreement and the petitioner committed breach of trust and made improvements to the determent of the complainant in the documents handed over.”
As it turned out, the Bench then discloses in para 8 that, “The complainant, subsequently, filed police complaint against the petitioner on 5 th January, 2011 with Police Station Safdarjung Enclave and before the EOW, Delhi, alleging that despite of receiving entire agreed sale consideration Accused no. 2 and 3, being directors of V4, failed to execute sale deed and the Petitioner in connivance released documents out of escrow account to accused no. 2 and 3, thereby committed criminal breach of trust under Section 409 of the Indian Penal Code, 1860 (hereinafter “IPC”).”
Quite revealingly, the Bench then specifies in para 9 that, “Application under Section 156(3) of the Cr.P.C. was also filed by the complainant, and vide order dated 30th June, 2011, the same was dismissed. However, cognizance was taken upon the complaint of the complainant and he was asked to lead pre-summoning evidence, in which the CW1 to CW4 were examined and all supported the story of the CW1, Rajender Kumar Jindal.”
What ensues next is then stated aptly in para 10 that, “The complainant thereafter, approached the learned Additional Sessions Judge against the order of dismissal of application under Section 156(3) of the Cr.P.C. and the same was also dismissed vide order dated 12th December, 2011.”
Simply put, the Bench then elaborates in para 11 that, “After examination of evidence, and consideration of other material on record, the petitioner was summoned by the learned Metropolitan Magistrate-01, South Saket, New Delhi, vide the impugned order dated 27th November, 2013, and the petitioner is now before this Court assailing the said order.”
It cannot be glossed over that the Bench then mentions in para 30 that, “As per the complaint filed by the complainant, there are no allegations that the documents deposited in escrow account have been utilized by the petitioner for his personal gain and advantage which is one of the essential ingredients of Section 409 of the IPC which facts proves that no case is made out against the petitioner under Section 409 of the IPC.”
Frankly speaking, the Bench then concedes in para 31 that, “Section 409 of the IPC necessitates commission of breach of trust with respect to a property that a person, in his capacity of a public servant or in the way of his business, is entrusted with. The necessary elements constituted in the offence must be strictly proved by the prosecution. It is true that prosecution need to prove the actual mode of misappropriation and once entrustment of all dominion over the property is established, then it would be for the accused to explain as to how the property was dealt with. In the instant case, the Court below while issuing summons against the petitioner has overlooked the facts that no material on the record to establish any misappropriation of the money of the escrow account and therefore, the Court below has passed the impugned order without application of mind.”
Quite candidly, the Bench then also concedes in para 32 that, “In proceedings initiated on the criminal complaint, exercise of the inherent powers to quash the proceedings is called for only in case where the complaint does not disclose any offence or is frivolous. It is well settled that the power under Section 482 Cr.P.C. should be sparingly invoked with circumspection; it should be exercised to see that the process of law is not abused or misused.”
Quite significantly, the Bench then stipulates in para 34 that, “The gist of the offence under Section 409, criminal breach of trust by public servant, or by banker, merchant or agent-whoever, being in any manner entrusted with property, or with any dominion over property in his capacity of a public servant or in the way of his business as a banker, merchant, factor, broker, attorney or agent, commits criminal breach of trust in respect of that property, shall be punished with imprisonment for life, or with imprisonment of either description for a term which may extend to ten years, and shall also be liable to fine. The gist of the offence is misappropriation done in a dishonest manner. There are two distinct parts of the said offence. The first involves the fact of entrustment wherein an obligation arises in relation to the property over which dominion or control is acquired. The second part deals with misappropriation which should be contrary to the terms of the obligation which is created.”
Most significantly, the Bench then lays bare in para 35 what forms the cornerstone of this learned judgment wherein it is postulated that, “Summoning of an accused in a criminal case is a serious matter. Criminal law cannot be set into motion as a matter of course. The complainant has to bring on record material to support his allegations in the complaint to have criminal law set into motion. The order of the Magistrate summoning the accused must reflect that he has applied his mind to the facts of the case and the law applicable thereto. He has to examine the nature of allegations made in the complaint and the evidence both oral and documentary in support thereof and would that be sufficient for the complainant to succeed in bringing charge home to the accused. It is not that the Magistrate is the silent spectator at the time of recording of preliminary evidences before summoning of the accused. The Magistrate has to carefully scrutinize the evidence brought on record and may even himself put questions to the complainant and his witnesses to elicit answers to find out the truthfulness of the allegations or otherwise and then examine if any offence is prima facie committed by all or any of the accused.”
Be it noted, the Bench then points out in para 36 that, “It is settled law that the Magistrate can discharge the accused at any stage of the trial if he considers the charge to be groundless, but that does not mean that the accused cannot approach the High Court under Section 482 of the Code or Article 227 of the Constitution to have the proceeding quashed against him when the complaint does not make out any case against him and still he must undergo the agony of a criminal trial.”
Most remarkably, the Bench then holds in para 37 that, “Keeping in view the facts and circumstances as well as allegations in the complaint, in my view, the basic essential ingredients of criminal breach of trust are missing. Criminal proceedings are not shortcut for other remedies. The petitioner is a practicing advocate and he has given his professional services to the parties and there is no material on record to establish prima facie that he has committed any offence as alleged in the complaint. Since no case of criminal breach of trust or dishonest intention of inducement is made out and the necessary ingredients of Section 409 of the IPC are missing and the Magistrate concerned while passing the summoning order dated 27th November, 2013 has certainly not considered the facts of the case in a proper manner and also not assigned any reason for summoning the petitioner, the summoning order dated 27th November, 2013 and the complaint qua the petitioner is liable to be quashed.”
What’s more, the Bench then hastens to add in para 38 that, “Accordingly, the instant petition under Section 482 of the Cr.P.C. is allowed, the impugned order dated 27th November, 2013 passed by Metropolitan Magistrate-01, South, Saket Courts, New Delhi is set aside and the complaint is also quashed qua the petitioner.”
Furthermore, the Bench then holds in para 39 that, “Pending application, if any, also stands disposed of.”
Finally, the Bench then concludes by holding in para 40 that, “The judgment be uploaded on the website forthwith.”
All in all, the Delhi High Court has very rightly arrived at the ineluctable conclusion that summoning of the accused is a serious matter. The Court has also rightly maintained that criminal law cannot be set into motion as a matter of course. We have already elaborated exhaustively on it in para 35 in particular. It certainly merits no reiteration that all the courts must definitely adhere to what the Delhi High Court has laid down so very explicitly in this leading case! Sanjeev Sirohi