ANAND KUMAR MOHATTA AND ANR. versus STATE (GOVT. OF NCT OF DELHI) DEPARTMENT OF HOME AND ANR.

Citation: [2018] 13 S.C.R. 1028 · Decided: 15-11-2018 · Supreme Court of India · Bench: S.A. BOBDE · Disposal: Leave Granted & Allowed
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Judgment (excerpt)

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SUPREME COURT REPORTS
[2018] 13  S.C.R.
ANAND KUMAR MOHATTA AND ANR.
v.
STATE (GOVT. OF NCT OF DELHI) DEPARTMENT OF HOME
AND ANR.
(Criminal Appeal No. 1395 of 2018)
NOVEMBER 15, 2018
[S. A. BOBDE AND L. NAGESWARA RAO, JJ.]
Penal Code, 1860:
s.406 – Criminal Breach of Trust – Development agreement
between appellant No. 1 and respondent No. 2 (Developer) –
Security amount of Rs. One crore was deposited by developer with
appellant No. 1 – As per the agreement the amount was liable to be
refunded when the developer would handover possession of the
areas of the owner’s share to the owner – Agreement could not be
fulfilled in view of new building regulations – Appellant No. 1
conveyed to the developer that he did not wish to develop the
property – FIR lodged by developer against appellant No. 1 alleging
criminal breach of trust for having not refunded security amount
and for having transferred the subject property in the name of his
wife i.e. appellant No. 2 – Petition by appellants u/s.482 Cr.P.C. for
quashing the FIR – High Court dismissed the petition as pre-mature
and directed the investigation to proceed – Appeal to Supreme Court
– During pendency of appeal, on completion of investigation charge-
sheet filed – Plea of appellants also for quashing the charge-sheet
– Held: The essence of offence of Criminal Breach of Trust lies in
the use of the property entrusted to a person, by that person, in
violation of any direction of law or any legal contract which he has
made during the discharge of such trust – Payment of Rs. one crore
by the developer was a security amount which was required to be
refunded when developer would hand-over the possession of the
area of the owner’s share to the owner – It is not entrustment of
property which was dishonestly converted by appellant No. 1 to his
own use or was disposed of in violation of any direction of law or
contract – Developer had also not made any attempt for recovery
of the money – The dispute has the contours of a dispute of civil
nature and does not constitute a criminal offence – Transfer of
[2018] 13  S.C.R. 1028
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property by appellant No. 1 in the name of his wife also did not
amount to commission of offence of Criminal Beach of Trust –
Therefore, the prosecution is mala fide, untenable and solely intended
to harass the appellants – FIR and charge-sheet are liable to be
quashed – High Court erred in dismissing the petition under s. 482
Cr.P.C.
Code of Criminal Procedure, 1973:
s.482 – Petition under – For quashing of FIR –
Maintainability of, when in the meantime charge-sheet is filed –
Held: The inherent power u/s. 482 is conferred to prevent abuse of
process of a court – The provision does not restrict the exercise of
its inherent power to prevent abuse of process of the court only to
the stage of FIR.
Allowing the appeal, the Court
HELD: 1. It cannot be said that  once the charge sheet is
filed, petition for quashing of FIR is untenable.  There is nothing
in the words of Section 482 Cr.P.C. which restricts the exercise
of the power of the Court to prevent the abuse of process of
court or miscarriage of justice only to the stage of the FIR. It is
settled principle of law that the High court can exercise
jurisdiction under Section 482 of Cr.P.C even when the discharge
application is pending with the trial court. It would be a travesty
to hold that proceedings initiated against a person can be
interfered with, at the stage of FIR but not if it has advanced, and
the allegations have materialized into a charge sheet. On the
contrary, it could be said that the abuse of process caused by FIR
stands aggravated if the FIR has taken the form of a charge sheet
after investigation. The power is undoubtedly conferred to prevent
abuse of process of power of any court. [Paras 15 and 17]
[1035-G-H; 1036-A-B, F-G]
Joseph Salvaraj A. v. State of Gujarat (2011) 7 SCC
59 : [2011] 8  SCR 815; G. Sagar Suri and Anr. v. State
of U.P and Others (2000) 2 SCC 636 : [2000] 1  SCR
417; Umesh Kumar v. State of Andhra Pradesh and Anr.
(2013) 10 SCC 591: [2013] 14 SCR 213  – relied on.
2. The charge that appellant No.1 has fraudulently
transferred the property which is the subject matter of the
ANAND KUMAR MOHATTA v. STATE (GOVT. OF NCT OF
DELHI) DEPARTMENT OF HOME
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SUPREME COURT REPORTS
[2018] 13  S.C.R.
agreement dated 03.06.1993 to his wife and has thereby
committed criminal breach of trust, is wholly untenable and rather
extraord
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