T APARNA Vs. RUKMINI LEASING LTD

JUDGEMENT

(1.) On a report given on behalf of the first respondent to the Inspector of Police, Ramachandrapuram, Medak District, alleging that in pursuance of an agreement between the first respondent and Sri Engineering Works, represented by its Proprietor Smt. T. Aparna, (i.e., petitioner herein) first respondent financed the petitioner to purchase machinery ana equipment worth about Rs.5 lakhs, and that as per the terms of the said agreement first respondent, as owner, is entitled to repossess the machinery purchased under the agreement, and the petitioner removed the said machinery from its premises and so necessary action may be taken. The said report was registered as a case in Cr.No.255 of 1999 under Sections 406 and 409 IPC, and investigation was taken up. At that stage, petitioner filed Crl.P.No.944 of 2000 in this Court to quash the FIR on the ground that the FIR does not disclose commission of any offence by her. This Court by its order-dated 22-6-2000 dismissed the said petition on the ground that the FIR cannot be quashed. Subsequently, police after investigation, filed charge-sheet against the petitioner for the offence under Sections 406 and 409 IPC, which was taken on file by the Judicial First Class Magistrate, Sangareddy as CC.No.175 of 2001. This petition is filed to quash the proceedings in the said C.C.No.175 of 2001.

(2.) The contention of the learned Counsel for petitioenr is that neither the FIR nor the charge-sheet disclose an offence, much less offences under Sections 406 and (or) 409 IPC and as breach of an agreement between the parties can at best give rise to a cause of action to initiate civil proceeding, but not criminal proceeding and since in fact the 1st respondent apart from filing a civil suit had also initiated proceedings under Section 138 of the Negotiable Instruments Act in connection with the bouncing of a cheque issued by the petitioner, opening of a third front by imitating proceedings in C.C.No.175 of 2001 against petitioner, is but an abuse of process of court and since the said proceedings are initiated with a view to harass and pressurize the petitioner they are liable to DC quashed. In support of his contention that when prosecution under Section 138 of the Negotiable Instruments Act is pending, launching of proceedings for the offences under Sections 406 and 409 IPC is not proper he relied on G. Sagar Suri v. State of U.P.. In support of his contention that no cheating can be made out from the averments in the petition, he relied on Hridaya Ranjan P.D. Verma v. State of Bihar. The contention of the learned Counsel for the first respondent is that an act can, apart from giving rise to a cause of action for initiation of civil suit also be a crime entitling punishment and so the mere fact that a civil suit is filed by itself is not a bar for initiation of criminal proceeding, and since the agreement between the parties forbids the petitioner hypothecating or selling or creating any encumbrances on the machinery handed over by the first respondent under hire-purchase agreement, and since the petitioner in breach of that agreement admittedly sold and parted with possession of machinery and received consideration and appropriated the sale proceeds that action of petitioner cannot be anything but criminal breach of Trust covered by Section 405 IPC. He contended that 1st respondent filing a civil suit for recovery of the amount due to it and initiating proceedings under Section 138 of Negotiable Instruments Act in connection with the bouncing of a cheque issued by the petitioner towards the instalments due and payable to 1st respondent are not and cannot be a bar for the 1st respondent initiating proceedings under Section 406 IPC, against the petitioner by relying on ALPIC Finance Limited v. P. Sadasivan, Lalmuni Devi v. State of Bihar and M. Krishnan v. Vijay Singh.

(3.) The contention of the learned Counsel for the petitioner that the complaint given to the police on behalf of 1st respondent does not disclose offences under Sections 406 and 409 IPC has no force. The averments therein do disclose the essentials for an offence under Section 406 IPC. This apart the requirement of giving a report to police is to bring to the notice of the police about the commission of an offence and put them in motion to make an investigation into the facts alleged. Report given to police need not be an encyclopedia of events, and need not contain all the minute details. The averments in the FIR in this case clearly show that the first respondent, who is the owner of the machinery, entrusted the same to the petitioner and that petitioner who ought to return that machinery as per the agreement with the 1st respondent parted with possession thereof. It is well-known that in a hire-purchase agreement the financier continues to be the owner of the property purchased, and delivered possession of to the hirer, till the last instalment due to the financier is paid, and till the hirer exercises his option to purchase the property after paying the last instalment due and payable as per the agreement. Therefore, prima facie, it is clear that first respondent, who is the owner of the machinery, entrusted the same to the petitioner under an agreement, whereunder petitioner undertook not to create any encumbrance or part with its possession, but in breach of that agreement sold the same and parted with possession thereof. Thus the essential ingredients as per Section 405 IPC, prima facie, are disclosed by the material on record. Section 406 IPC prescribes the punishment for criminal breach of Trust as defined in Section 405 IPC. Section 409 IPC also deals with an offence of criminal breach of trust but it applies when the said offence is committed by a person entrusted with or with any dominion over the property in his capacity as a public servant, banker, merchant, etc. In such case punishment for an offence under Sec. 409 IPC is more than the one mentioned in Section 406 IPC. Whether petitioner is, or is not a merchant, or comes under any of the categories mentioned in Section 409 has to be decided only after taking evidence but not at this stage. If necessary ingredients under Section 405 IPC are established by the prosecution, and if it is also able to establish that petitioner comes under any of the categories mentioned in Section 409, the offence would be punishable under Section 409. If prosecution is not able to establish that petitioner falls under any of the categories mentioned in Section 409 IPC, the offence would be punishable under Section 406 only. Petitioner cannot be given punishmentboth under Sections 406 and 409 IPC for the same Act separately, in view of Section 71 IPC.