AJAY MITRA versus STATE OF M.P. AND ORS.

Citation: [2003] 1 S.C.R. 622 · Decided: 28-01-2003 · Supreme Court of India · Bench: S. RAJENDRA BABU · Disposal: Appeal(s) allowed

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Judgment (excerpt)

A 
AJAY MITRA 
v. 
STATE OF M.P. AND ORS. 
JANUARY 28, 2003 
B 
[S. RAJENDRA BABU, BRIJESH KUMAR AND G.P. MATHUR, JJ.] 
Code of Criminal Procedure, 1973-Section 482-Criminal complaint/ 
FIR-Non-disclosure of commission of a cognizable offence-Quashing of-
C Held, such criminal complaint and FIR registered in pursuance thereof are 
liable to be quashed-Penal Code, 1860-Section 420. 
Penal Code, 1860-Section 420-Cheating-Essential ingredient-
Discussed 
D 
Complainant company entered into bottling agreements with 
company C which were to continue for a term of five years. Either party 
could terminate the agreement at the end of initial term by giving 10 
months notice in writing to the other side. Subsequently, a wholly owned 
indirect subsidiary company of an export corporati_on purchased 
~
trademarks from company C and the bottling agreements were assigned 
E to it. Subsidiary company then gave written notice to the complainant that 
they would not renew the agreement after expiry. Aggrieved, complainant 
company filed a criminal complaint against accused persons including 
appellants under Section 420 read with Section 511 IPC. Company C was 
arrayed as accused No.1 and subsidiary company as accused No.6 in the 
F complaint. It was alleged that accused No.6 has adopted unfair trade 
practices and has made wrongful gain and accused No.1 has cheated the 
complainant by making false representations. Magistrate directed the 
police to investigate the offence. Police submitted its report and case was 
registered under Sections 420, 120-B, 34 IPC and investigation~ were being 
carried out. Appellants then filed petitions under Section 482 Cr.P.C. for 
G quashing of FIR and the proceedings of the case before the Magistrate. 
H 
High Court holding that the petitions were pre-mature dismissed the 
petitions. Hence the present appeal. 
Appellants contended that there is no allegation in the complaint 
to make out offence against them; and that the allegations even if accepted 
622 
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A.IA Y MITRA v. STATE OF M.P. 
623 
at their face value, do not disclose commission of any offence by appellants, A 
therefore, the proceedings of the complaint ca>e and FIRs are liable to be 
quashed. 
Respondents-State contended that police report stated that it was a 
case of violation of agreement for which complainant could seek relief from 
civil court, however, in view of subsequent order passed by Magistrate, 
case had been registered at the police station and matter was being 
imestigated. 
B 
Complainant contended that the allegations in the complaint disclose 
commission of an offence under Section 420 IPC by accused persons; and C 
that High Court rightly held that the petitions filed for quashing of the 
proceedings were pre-mature and the order does not suffer from any error 
of law. 
Allowing the appeal, the Court 
D 
HELD: I. I. A guilty intention is an essential ingredient of the offence 
of cheating under Section 420 IPC. In other words 'mens rea' on the part 
of the accused must be established before he can be convicted ofan offence 
of cheating. In the instant case appellants came into picture when various 
trademarks and brands of accused No. I were purchased by accused No.6. 
They were not at all in picture at the time when the complainant claims E 
to have spent money in improvement of its bottling plant on the basis of 
the agreement executed with accused No.I, therefore, neither any guilty 
intention can be attributed to them nor there can possibly be any intention 
on their part to deceive the complainant. Therefore, no offence of cheating 
can be said to have been committed by appellants on account of the fact F 
that a notice was given to the complainant that the bottling agreements 
will not be renewed any further aite.- expiry of the initial term. 
(630-F; 631-D-F( 
Jeswantrai Manila/ Akhaney v. The State of Bombay, AIR (1956( SC 
575; Mahadeo Prasad v. State of West Bengal, AIR (1954) SC 724; Hari G 
Prasad Chamaria v. Bishun Kumar Surekha and Ors., AIR (19741 SC 301 
and G. V Rao v. l.H. V Prasad and Ors., 120001 3 SCC 693, referred to. 
1.2. In the instant case, the allegations made in the complaint is that 
accused No.6 has adopted unfair trade practices and has made wrongful 
gain and accused No.I has cheated the complainant by making false H 
624 
SUPREME COURT REPORTS 
(2003) I S.C.R. 
A representations, even if the allegations made in the complaint are accepted 
to be absolutely true and correct, appella

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