MITESH KUMAR J. SHA versus THE STATE OF KARNATAKA & ORS.

Citation: [2021] 8 S.C.R. 875 · Decided: 26-10-2021 · Supreme Court of India · Bench: S. ABDUL NAZEER, KRISHNA MURARI · Disposal: Appeal(s) allowed

cites 5 · see the full citation network in Lexace

Judgment (excerpt)

A
B
C
D
E
F
G
H
875
[2021] 8 S.C.R. 875
875
MITESH KUMAR J. SHA
v.
THE STATE OF KARNATAKA & ORS.
(Criminal Appeal No. 1285 of 2021)
OCTOBER 26, 2021
[S. ABDUL NAZEER AND KRISHNA MURARI, JJ.]
Code of Criminal Procedure, 1973: s.482 – Complaint by
respondent no.2 against appellant alleging that the appellant-builder
company had sold four excess flats beyond its share, in terms of the
agreements entered into between them – Appellant filed s.482
application before High Court which was dismissed – Hence instant
appeal – Held: The facts did not show that appellants deceptively
or intentionally tried to sell excess flats as contended by respondent
No. 2 – Although, there is no doubt that a singular factual premise
can give rise to a dispute which is both, of a civil as well as criminal
nature, each of which could be pursued regardless of the other – In
the instant case, the actual question which required consideration
was not whether a criminal case could be pursued in the presence
of a civil suit, but whether the relevant ingredients for a criminal
case were even prima facie made out – Based on the facts, clearly
no cogent case regarding a criminal breach of trust or cheating
was made out – Dispute could at best be termed as one involving
breach of contract – Mere breach of contract cannot give rise to
criminal prosecution for cheating unless fraudulent or dishonest
intention is shown right at the beginning of the transaction, that is
the time when the offence is said to have been committed – Therefore,
it is the intention which is the gist of the offence – Applying this
dictum to the instant factual matrix, the key ingredient of having a
dishonest or fraudulent intent under ss.405, 419 and 420 was not
made out – Criminal proceedings initiated against appellant quashed
– Penal Code, 1860 – ss.405, 419 and 420.
Abuse of the process of law: Imparting criminal color to a
civil dispute, made merely to take advantage of a relatively quick
relief granted in a criminal case in contrast to a civil dispute – Such
an exercise is nothing but an abuse of the process of law which
must be discouraged in its entirety – Code of Criminal Procedure,
1973 – s.482.
A
B
C
D
E
F
G
H
876
SUPREME COURT REPORTS
[2021] 8 S.C.R.
Allowing the appeal, the Court
HELD: 1.1 The complaint levelled against the appellants
is one which involves commission of offences of criminal breach
of trust and cheating. While a criminal breach of trust as postulated
under section 405 of the Indian Penal Code, entails
misappropriation or conversion of another’s property for one’s
own use, with a dishonest intention, cheating too on the other
hand as an offence defined under section 415 of the Indian Penal
Code, involves an ingredient of having a dishonest or fraudulent
intention which is aimed at inducing the other party to deliver
any property to a specific person. Both the sections clearly
prescribed ‘dishonest intention’, as a pre-condition for even prima
facie establishing the commission of said offences. Thus, in order
to assess the relevant contentions made by the parties, the
question whether actions of the appellants were committed in
furtherance of a dishonest or fraudulent scheme is one which
requires scrutiny. [Para 28][888-C-E]
1.2 Upon a careful assessment of such facts, by no stretch
can it be concluded that the Appellants have deceptively or
intentionally tried to sell excess flats if any, as contended by
Respondent No. 2. Subsequent to the revocation of GPA, it was
the Appellants who had first resorted to arbitration proceedings
on 02.03.16 for redressal of dispute between the parties, to which
Respondent No 2 had accordingly filed his statement of objections
dated 09.03.16. It was only on 29.03.16 that Respondent No. 2
had filed the FIR in question bearing Crime No. 185/2016 against
the Appellants. Moreover, it was Respondent No. 2 who had
withdrawn his prayer with respect to selling of four excess flats
by the Appellants, only to pursue the same in civil proceedings.
[Para 35][889-F-H]
1.3 Although, there is perhaps not even an iota of doubt
that a singular factual premise can give rise to a dispute which is
both, of a civil as well as criminal nature, each of which could be
pursued regardless of the other. In the instant case, the actual
question which requires consideration is not whether a criminal
case could be pursued in the presence of a civil suit, but whether
A
B
C
D
E
F
G
H
877
the relevant ingredients for a criminal case are even prima facie
m

Excerpt shown. Read the full judgment & AI analysis in Lexace.