BHOLA NATH ARORA Vs. STATE

JUDGEMENT

(1.) M/s. Bhagat Industrial Corporation Limited (hereinafter referred to as the Complainant) has its registered office at Khasa, District Amritsar and its Head Office is situated at 54, Janpath, New Delhi. It, inter alia, deals in Indian manufactured foreign liquor and had wholesale licence for the same in Uttar Pradesh uptill 31st March, 1976. The whole sale business of liquor in Uttar Pradesh was being managed from its Branch at Kanpur Cantonment. Since the company was left with huge quantities of unsale stock by end of the term of its licence, the licence was extended upto 30th April, 1976 and as per terms of the licence the Complainant was required to sell the unsold quantity to a Wholesale merchant only after obtaining prior permission of the District Excise Authorities, Kanpur. On 1st November, 1976, the Complainant lodged a report through Mr. O. N. Seth, their Export Manager, with Police Station Gonnaught Place, New Delhi, contending that sometime in the last week of April, 1976, S/Shri Bhola Nath Arora and Raman Arora (the present petitioners), who described themselves as partners of M/s. B. D. Raman Arora, Varanasi, contacted the Go nplainant through Mr. Seth at their Head Office at 54, Janpath, New Delhi and expressed a desire to lift the unsold liquor of various brands lying with the Complainant at Kanpur. Since the financial position of the petitioners was not known to the complainant, they were reluctant to agree to the said proposition except against payment in cash. However, the petitioners represented that they were men of lakhs and they would make part payment by means of bank, draft and the balance by instalments through post-dated cheques to be issued by them. Since the unsold quantity as on 30th April, 1976, could be sold to a wholesale dealer in Uttar Pradesh only, necessary permission was obtained by the Complainant from the Excise Department, Kanpur, on 7th May, 1976, and the petitioners took delivery of the goods covered under invoice Nos. 1560, 1561 and 1562, all of even date of 9th May, 1976. They assured Mr. Seth that payment would be made and thus they induced Mr. Seth to accept part payment by bank draft and balance payment by post-dated cheques and to effect delivery. The total value of the goods thus delivered to the petitioners on 9th May, 1976, came to Rs. 1,44,252/36 P out of which a sum of Rs. 27,000.00 was paid by the petitioners by means of a demand draft and for the balance amount four cheques dated 5th June, 1976, dated 24th June, 1976, 19th July, 1976 and 14th August, 1976, in the sums of Rs. 29,313/36, Rs. 29,313.00 ,Rs.29,313.00 and Rs. 29,313.00 respectively were delivered by them to Mr. Seth. The said cheques were presented on the due dates to the Bankers of the petitioners but the same were returned unpaid with the endorsement "refer to drawer" on two cheques and "not arranged for" on the other two cheques. The complainant further contended that after the removal of the goods and subsequent to the dishonour of the cheques, the petitioners did not at all contact the Complainant and inform them as to why the cheques had been dishonoured. Thus, it was alleged that the petitioners had dishonest intention right from inception and with intent to cheat the Complainant and cause wrongful loss to them and wrongful gain to themselves they did all this. The Complainant asserted that the conduct of the petitioners proved their dishonest and fraudulent intention from the very beginning and even when they were contacted personally they told them that they had succeeded in obtaining the goods worth Rs 1,44,252/36 P for just Rs. 27,000.00 . It was submitted that the Complainant would not have delivered the goods but for the inducement that the delivery was being effected against post-dated cheques with the assurance that the same would be honoured on presentation on due dates.

(2.) The Police after investigation put in a challan under Section 173, Code of Criminal Procedure (for short the Code), for prosecution of the petitioners under Section 420, Indian Penal Code.

(3.) After entering appearance the petitioners moved an application, purported to be under Section 239/294 of the Code, contending that the subject matter of the challan was just a business transaction between the parties and at best it gave rise to civil liability. They also sought permission to produce certain documents in order to demolish the allegations of the prosecutions in regard to the ingredients of cheating. Further they expressed a desire to be examined before framing of the charge and contended that the investigating agency has manoeuvred and twisted the facts in order to usurp jurisdiction at Delhi for investigation even though no part of the cause of action had arisen at Delhi and the goods were delivered as well as received in the State of Uttar Pradesh.