Kishor Venkatrao Sathe vs. The State Of Maharashtra And Anr

Held

The Court held that the FIR and the allegations therein do not constitute an offence under Section 420 of the Indian Penal Code. The Court emphasized that to establish cheating under Section 420 IPC, fraudulent or dishonest intentions at the time of making a promise must be demonstrated. In this case, the dispute arose from a commercial transaction for the purchase of machinery. The Court found no material to indicate that the Applicant had any mala fide intention against the Respondent, which was further supported by the nature of the transaction. The Court concluded that even if all allegations in the FIR were accepted as true, there was no evidence to support a prosecution under Section 420 IPC, as the dispute was clearly of a civil nature. Therefore, to prevent abuse of the process of the court and to secure the ends of justice, the impugned FIR was quashed. The Court allowed the application in terms of prayer clause (B), which sought to quash and set aside the FIR.

Facts

The Applicant, Kishor Venkatrao Sathe, proprietor of 'Sai Solar System', is seeking to quash an FIR registered against him by Respondent No. 2, Vanita Bapuji Vhatkar. Respondent No. 2 had approached the Applicant for agricultural machinery. A quotation was provided and accepted, with specifications and terms agreed upon. The Applicant supplied equipment worth Rs. 62,00,000/-, including a GST bill. However, Respondent No. 2 allegedly failed to pay the remaining 40% consideration before delivery, leading to the non-supply of certain accessories. Respondent No. 2 also allegedly requested hand-loans totaling Rs. 19,40,000/-. The Applicant contends that the dispute is commercial and civil in nature, and the FIR for an offence under Section 420 of the Indian Penal Code is an abuse of process.

Key Issues

1. Whether the FIR registered under Section 420 of the Indian Penal Code, 1860, discloses the ingredients of the offence, considering the dispute arises from a commercial transaction? Petitioner's Arguments: The Applicant argued that the complaint does not disclose the offence of cheating under Section 420 IPC. The dispute is purely commercial and can only be ascertained through evidence and documents by a Civil Court. The initiation of criminal proceedings is an abuse of the process of the court, as even if the FIR's averments are taken as true, the case for prosecution under Section 420 IPC is not made out. The Applicant relied on Supreme Court judgments in Indian Oil Corporation Vs. NEPC India Ltd. & Ors. and Vijay Kumar Ghai & Ors. Vs. State of West Bengal & Ors. to argue against converting civil disputes into criminal cases. Respondent's Arguments: Respondent No. 2 argued that the allegations in the FIR satisfy the ingredients of Section 420 IPC. The Applicant allegedly deceived Respondent No. 2 into believing the machinery met certain specifications, thereby dishonestly inducing her to pay. It was argued that it is not necessary to reproduce all ingredients of the offence in the complaint or explicitly state the accused's dishonest intention.