Deepak Kuamr Saraf @ Deepak Sarraf vs. The State Of Bihar
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The petitioner, Deepak Kumar Saraf, sought to quash the order of cognizance dated November 11, 2022, passed by the Judicial Magistrate, 1st Class, Katihar, in Complaint Case No. 591 of 2022, for alleged offences under Sections 406 and 420 of the Indian Penal Code. The complainant, Vijay Kumar Agrawal, a dealer of Dalmia Cement, alleged that the petitioner, who was the CNF (Carrying and Forwarding) agent for Dalmia Cement, generated false bills, causing him a loss of approximately Rs. 20,00,000/- and forcing him to sign no-dues papers. The petitioner contended that the dispute was a business transaction between the complainant and the company, and he had no direct involvement in the alleged fraudulent billing.
Held
The Court held that the complaint, on its face, depicted a business transaction that had been ongoing for approximately ten years. There was no allegation or material presented to suggest that the petitioner's initial intention was dishonest. Consequently, the Court found that no offence under Sections 406 or 420 of the Indian Penal Code was made out against the petitioner. The Court reasoned that the dispute primarily related to business dealings between the complainant and the company, and the petitioner, as a CNF agent, was not directly implicated in a manner that would warrant criminal prosecution under these sections. The order of cognizance dated November 11, 2022, was therefore quashed concerning the petitioner.
Key Issues
1. Whether the allegations made in the complaint disclose any offence under Section 406 of the Indian Penal Code, concerning criminal breach of trust, in relation to the business transactions between the complainant and the company? 2. Whether the allegations made in the complaint disclose any offence under Section 420 of the Indian Penal Code, concerning cheating and dishonestly inducing delivery of property, in relation to the business transactions between the complainant and the company? The petitioner argued that the dispute was purely a business transaction and that there was no initial dishonest intention on his part, thus no offence under Sections 406 or 420 IPC was made out. He further submitted that the dispute was between the complainant and the company, not with him as the CNF agent. The complainant and the State opposed the quashing of the cognizance order, arguing that the petitioner had defalcated money by generating fake bills, causing financial loss to the complainant and wrongful gain to himself.
Sections Cited
Section 406, Section 420
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
ORAL JUDGMENT Date : 27-04-2026 Heard Mr. Jitendra Prasad Singh, learned senior counsel assisted with Ms. Sripriya Sinha, learned counsel for the petitioner, Mr. Mrinal Kumar, learned counsel for the informant and Mr. Pranav Kumar, learned Additional Public Prosecutor for the State.
Petitioner seeks quashing of the order of cognizance dated 11.11.2022 passed by learned Judicial Magistrate, 1st Class, Katihar in Complaint Case No. 591 of 2022 for the offences under Sections 406 and 420 of the Indian Penal Code.
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The complainant alleged that he was having a shop namely Agrawal Cement Store at Kursela, Katihar where he was working as dealer of Dalmia Cement from last ten years. The petitioner was the CNF of Dalmia cement. There was an agreement and pursuant to that agreement which has been brought on record, the complainant came to know that the CNF has generated false bills giving him a loss of around Rs. 20,00,000/- and forced him to sign on no dues paper.
Learned counsel for the petitioner submits that there was a dispute which was initially settled but later on the complainant withdrew from the same and expressed his will to continue with the prosecution.
Learned counsel for the complainant disputes the submissions made by the petitioner and submits that the company has made terms and conditions for dealers to get delivery of cement and any dealer who wishes to purchase cement has to make payment of the cost of the goods from his firm account through bank in the account of the company, thereafter, the dealer is required to generate sale order from its own computer. It is also submitted that as soon as goods are delivered under proper acknowledgment receipt of dealer, CNF on the link site of the company generates bill in the name of dealer in link of the company sale order and when bill generated on 3/4 the company site as per the dealer order link which is attached with the dealer mobile, the full details of quality, value, item with vehicle number and GST bill appears. It is also submitted that the petitioner has no concern with the dispute between dealer and company.
Learned counsel for the opposite party No. 2 and learned Additional Public Prosecutor for the State has vehemently opposed the prayer for quashing of the impugned order of cognizance dated 11.11.2022. He further submits that the petitioner has defalcated his money by generating fake bills and he used to clear bills in his name and it has caused loss to him and he has wrongfully gained to the accused.
A bare perusal of the FIR shows that it is out and out business transaction where apparently their transactions were going on for last ten years. In view of the fact that there is no allegation or any material to suggest that initially the intention of the petitioner was dishonest no prosecution under Sections 406 or 420 IPC would continue.
Considering that no offence is made out against the petitioner under Sections 406 and 420 IPC rather the dispute relates to business transaction between the complainant and the company and not with the petitioner who is CNF of the company, the order of cognizance dated 11.11.2022 passed by learned Judicial Magistrate, 1st Class, 4/4 Katihar in Complaint Case No. 591 of 2022, is quashed so far as the petitioner is concerned.
Accordingly, the present petition is allowed. Vikash/- (Ansul, J) AFR/NAFR NAFR CAV DATE Uploading Date Transmission Date
Reproduced from the public record of the Patna High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.