Mansimran Kaur

New Delhi, June 14, 2022:  While observing that summoning of an accused in a criminal case is a serious matter and the Magistrate should carefully analyze the nature of the allegations made in the complaint, the Delhi High Court has set aside the impugned summoning order issued against the petitioner as the the Magistrate passed the order in a mechanical manner without recording any cogent reasons.

A Single-Judge Bench of Justice Chandra Dhari Singh opined that criminal law cannot be set into motion as a matter of course and the complainant is required to produce relevant materials on record in order to corroborate his allegations.The Bench said, “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.”

Facts relevant for adjudication of the present appeal was filed by  a practicing Advocate, enrolled with the Bar Council of Delhi and the respondent/complainant was a real estate development company. In 2005, four promoters of complainant company jointly promoted ‘V4 Infrastructure Pvt Ltd’ and prior to its incorporation, 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.

Thereafter, in 2008 certain disputes arose between the promoters and three of the promoters exited the V4 and sold their equity shares. Consequently, share purchase agreements were drawn up and as part of settlement, part of commercial property developed by V4, was agreed to be sold to the complainant company for an agreed consideration for which two separate space buyer agreements were executed between the complainant and V4.  The petitioner was appointed in order to execute the same.

Subsequently V4 agreed to handover possession letters for said property in escrow account, however the same were not deposited due to non- adherence of the complainant company to the agreed terms. The case of the complainant was that the letters were eventually handed over, however the same were released by the petitioner illegally to the second and the third accused.  The complainant alleged that the petitioner in collusion with the second and the third accused made reforms in the space buyers agreement and committed the breach of trust thereby making improvements to the determinant of the complainant in the documents handed over. 

Eventually, the complainant was filed a criminal complaint against the second and third accused for not executing the sale deed and against the petitioner for committing criminal breach of trust under Section 409 of the Indian Penal Code, 1860 . Thereafter, application under Section 156 (3) of the Cr.P.C , the same was dismissed However, cognizance was taken upon the complaint of the complainant. The petitioner was summoned by the Metropolitan Magistrate through impugned order and the same was assailed by the petitioner before this Court. 

The High Court observed that as per the complaint filed by the complainant, there were no allegations that the document deposited in the escrow amount was utilized by the petitioner for his personal gain and for his personal advantage which is one the essential ingredients of Section 409 of IPC, and the same proved that no case was made out against the petitioner under Section 409 of IPC.  The Court further observed 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, remarked the Court. 

On the facts of the present case, it was held that the Court below while issuing summons against the petitioner had overlooked the facts that there was 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 in a mechanical manner. 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, added the Bench. 

The Court concluded the matter by observing that no case of criminal breach of trust was established against the petitioner under Section 409 of IPC. It was also stated that the impugned order passed by the Magistrate was not reasonable and was passed without recording cogent reasons for the same. Accordingly, the instant petition under Section 482 of Cr.P.C. was allowed and the impugned order was set aside and quashed. 

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