The bench of the Supreme Court comprising Justices DY Chandrachud and MR Shah observed that the High Court could use its power of writ jurisdiction given under Article 226 of the Constitution of India to quash an FIR registered with abuse of process of law.
Facts of the case
In the present case, a licensed franchise of PepsiCo named Varun Beverages Ltd. (VBL) was engaged in the manufacture and sale of fruit juice, packaged drinking water, carbonated sweetened water for PepsiCo. In the year 2013, they appointed the complainant’s firm as the distributor in the Loni area of District Ghaziabad. One year later, the contract of distributorship was terminated by the company due to non-payment of dues by Respondent 1 who was the original complainant. After adjusting all claims and security deposits, it was found that the amount of approx. Rs.9 Lakh 46 thousand was outstanding. On September 15 2014, the complainant issued a cheque in favour of the company which was later dishonoured and returned unpaid by the banker of the complainant in lieu of “insufficient funds.”
Earlier, R1 had filed a complaint against the company for misappropriation of money of which the report came negative. Again, R1 filed a case against the company for misappropriation of money which was treated by the learned magistrate as the complaint case under Section 156(3) of CrPC. Instead of issuing directions to the police to file FIR, it decided to enquire into the matter. Also, R1 was allowed to record the statement under Section 200 of CrPC. Being aggrieved by the Order, R1 filed the revision application before the learned Session Judge, which was allowed and the Order of the learned magistrate of District Ghaziabad was set aside.
Almost after 2 years, R1 filed an FIR against the Appellant under Section 406/420 IPC having similar allegations as in the application under section 156(3) of CrPC pending before the learned magistrate from 2015. As a consequence, the Appellant approached the High Court via writ jurisdiction under Article 226 of the Constitution of India to quash the FIR which was refused by the High Court. Aggrieved by the impugned Order, an appeal was filed before the Supreme Court
Pleadings before the Court
In the present case, the learned Counsel on behalf of Appellants submitted that the present FIR was prima facie abuse of process of law as in this case, the matter was purely civil which was converted into a criminal matter just to harass the Appellants. It was further submitted that the contents of the FIR showed that the matter was purely a contractual dispute. Also, the Respondent had not filed any civil proceedings for recovery of the amount.
On the other hand, the learned Counsel on behalf of the Respondent submitted that the FIR disclosed the commission of the cognizable offence, therefore, the High Court was right in not quashing the FIR while exercising the powers under Article 226 of the Constitution.
The Court observed that the inherent authority under Section 482 of the Criminal Procedure Code and/or Article 226 of the Constitution was intended to achieve a beneficial function, and that criminal trials should not be allowed to devolve into a tool of abuse.
If it was determined that the subsequent FIR was filed in violation of the law and/or was filed solely to annoy the accused, the FIR might be quashed under Article 226 of the Constitution or Section 482 of the Criminal Procedure Code. In that situation, the infringement case would be handled in compliance with the Cr.PC’s provisions.
The Supreme Court bench, in this case, found that the subsequent FIR filed by the original claimant was a violation of the process of law and it was used to put pressure on the accused. The court upheld the appeal, saying that “We are of the opinion that the High Court ought to have quashed the impugned FIR to protect the ends of justice because the impugned FIR is nothing but a misuse of process of law and to threaten the Appellants-accused.”
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