Libertatem Magazine

Delhi HC Saves Business, Quashes FIR Stating Unacceptability in Law

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In the case of Ramesh Boghabhai Bhut v State and Anr., Justice Suresh Kumar Kait, quashed an FIR, accordingly allowing and disposing of the petition.

Brief Facts

The Petitioner, through a sole proprietorship, has been undertaking the business exporting fresh/dehydrated onions and garlic and other perishable items to various countries like Europe, the Gulf and the rest of Asia. The Petitioner, based on the transit time of 21 days promised by Tiger Logistics, entered into a sales contract with his customer Sadro SRL, an importer based in Italy.

The Petitioner only as a goodwill gesture and as a sincere exporter,  upon the insistence of the representatives of Tiger Logistics, paid an amount of Rs.10,76,100/-. The shipment did not reach the Port of Naples within 21 days. Due to the delay, the buyer in Italy cancelled the remaining shipment of the Petitioner. Despite the tremendous delay in delivery which led to the Petitioner incurring a huge loss, Respondent 2 started demanding approx. Rs. 37 Lakhs from the Petitioner. 

Submissions by Counsel for Petitioner

Learned counsel for the petitioner submitted that:

  1. The allegations in the FIR did not disclose that the Petitioner had fraudulent or dishonest intention or mens rea, 
  2. That courts in Delhi do not have jurisdiction to adjudicate in this matter, 
  3. There has been a lapse of logistic service commitment for which they are demanding full payment, and 
  4. The dispute raised by the Respondent No. 2 in its complaint did not disclose the commission of any criminal offence. 
  5. Learned counsel also relied on the case of V.Y. Jose and Anr. v. State of Gujarat and Anr.: 2009 (3) SCC 78, Navinchandra N. CRL.M.C. 1616/2020 Page 9 of 26 Majithia v. State of Maharashtra & Ors.: (2000) 7 SCC 640, Rajandra Ramchandra Kavelkar vs. State of Maharashtra & Anr.: AIR 2009 SC 1792. 

So, the allegations were in the nature of civil proceedings. The criminal proceeding is an attempt of the complainant to convert the civil dispute into a criminal dispute is a gross abuse of law and process. 

Submissions by Counsel for State

Learned APP for State and counsel for the respondent 2 submitted that:

  1. Respondent 2 raised invoices for providing its services for which invoice Petitioner made part payment of Rs.10,76,800/- to Respondent 2 at New Delhi. 
  2. Quoting section 181 (4)of the Cr. P. C, Learned counsel submitted that if part of the cause of action arose at a particular place, the local court shall have jurisdiction in the matter. 
  3. Also, in this case, said Respondent has received threats and assault plus Petitioner has paid Rs. 10,76,800/- to Respondent no. 2, both in New Delhi. So, the present FIR is legally maintainable in New Delhi.  
  4. Learned counsel also relied on the case of Ravindra Kumar Madanlal Goenka vs. Rugmini Ram Raghav Spinners Pvt. Ltd. & Anr.: (2009) 11 SCC 529, Kamal Shivaji Pokarnekar vs. State of Maharashtra & Ors.: (2019) 14 SCC 350, Rhea Chakraborty vs. State of Bihar & Ors.: (2020) SCC Online SC 654, Indian Oil Corporation vs. NEPC India Ltd. & Ors.: (2006) 6 SCC 736.

Court’s Observation and Decision

The court dealt with all issues stepwise, quoting Court cases. In the case of V.Y. Jose (supra), the Hon’ble Supreme Court has held that even in absence of a culpable intention at the time of making the initial promise being absent, no offence under Section 420 of the IPC can be said to have been made out. There was a delay, because of which petitioner incurred loss and not paid the total amount. 

Referring to the case of Jai Prakash vs. Dinesh Dayal: (1989) 39 DLT 376, the court observed that institution of complaint on the ground that the complainant’s head office situated in New Delhi, does not constitute jurisdiction, In the case of the State of Haryana & Ors. vs. Bhajan Lal & Ors.: 1992 SCC (Cri.) 426, the SC held that in regard to exercise of power under Section 482 of Cr. P. C. Under the following circumstances, the HC must exercise its jurisdiction to quash any frivolous complaint.

Therefore, the cases cited by counsel for respondent 2 were not applicable. Accordingly, the Hon’ble court quashed the FIR and allowed and disposed of the petition with emanating proceedings thereto.

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