1. In the petition, the petitioners inter alia have sought multiple reliefs;
(a) Firstly, the petitioners sought transfer of criminal complaint from the court of learned Judicial Magistrate 1st Class, Baramulla to any other court of
parallel competent jurisdiction at Jammu.
(b) Secondly, they prayed that the criminal complaint pending before the court below be quashed while exercising the powers u/s 561-A Cr.P.C.
(c) Thirdly, they have also sought the order dated 29.03.2017 passed by the learned Judicial Magistrate, Baramulla by virtue of which cognizance has
been taken, be quashed.
2. In the petition, it has been stated that petitioner No.1 is the Marketing head whereas petitioner No.2 is the Managing Director of M/s Niagara
Metals India limited. M/s Niagara Metals India limited is a reputed company of India incorporated in the year 2004 under the Companies Act, 1956
and is engaged in manufacturing of Heavy Steel Fabrications, Design, Detailed Engineering, Fabrication, Supply and Construction of Pre-
Engineered/Pre-Fabricated Steel Structural Buildings (PEB) on Turnkey basis. M/s Niagara Metals India limited was established as an Indo-American
Joint Venture patronized by the Green Brier Groups, Â USA and has enjoyed the distinction of being amongst the few Indian Companies to be
certified by the Association of American Rail Roads. It has been a leading supplier to Companies like Gunderson Inc USA, Trenton Works Canada,
JCB United Kingdom, Metso Minerals, ISGEC-Johan Thompson, BHEL, DLW to name a few. The plaint of M/s Niagara Metals India limited is
located on the Chandigarh Road, Ludhiana (Punjab) on a 60000 sq.ft. of Built up area and the unit has the capacity to churn out 2000 MT/ Month of
world class and the most complex steel fabrications. It is further stated that in furtherance of the business activity of M/s Niagara Metals India limited,
the respondent met the petitioner No.1 in the first week of February, 2017 through one of his friends Mr. Anwar Ali at Jammu and wanted M/s
Niagara Metals India Limited to do fabrication work for him. After the initial meeting, the respondent sent drawings to M/s Niagara Metals India
Limited India on 19.02.2017 at Ludhiana which were again sent by him next date as the initial drawings were not legible. After the initial consultation
an amount of Rs.15.00 Lac as advance was given by way of cheque by the respondent to the petitioner at Ludhiana as advance payment for
finalization of the order. The fabrication work which was to be done is with regard to Open Air Showroom of Automobiles in Srinagar. After getting
the advance payment, the petitioners initiated the fabrication work at Ludhiana but contrary to the Agreement executed between the parties at
Ludhiana, the respondent did not adhere to the terms and conditions of the agreement. It is also contended that as is clear from the agreement afore-
referred there is no scope of unilateral cancellation or modification of the contract under any circumstances. The entire gamut of designing and
detailed engineering activity of the project of the respondent has involved enormous expenditure on the petitioners. Even after the final approval of the
final drawings the respondents made additions in the structure which raised costs by 12%. However, as a matter of indulgence the petitioners did not
revise or raise the cost as an expression of goodwill. Thereafter, the request by the petitioner to the respondent for making balance payment was not
acceded to by the respondent and the respondent defaulted in the agreement by not making the balance payment. As a matter of fact, because of the
default committed by the respondent and his non-adherence to the terms and conditions of the contract/agreement the petitioner suffered loss worth
Rs.40 Lac for which the respondent has already been informed through email dated 01.12.2014. The cancellation of the agreement by the respondent
unilaterally on the projected justification of floods in Kashmir valley clearly shows that the default was on the part of the respondent. It is further
averred that the respondent instead of settling the issues with the petitioners by making the balance payments, has chosen to file a criminal complaint
titled M/s Apex Builders Vs Harsh Mahajan and another before the Court of learned Judicial Magistrate, 1st Class, Baramulla, Kashmir. It is further
stated that the petitioners being the resident of Punjab cannot attend the criminal proceedings at Srinagar due to the prevailing circumstances.
3. The petitioners have challenged the complaint and order impugned on the ground that the complaint is not sustainable stating that from bare perusal
of the complaint, no offence is made out as per the allegations leveled against petitioners in the complaint. The complaint has been moved with mala
fide intention and the court below lacks the territorial jurisdiction because the cause of action in the instant petition has accrued at Ludhiana, Punjab
where the agreement has been communicated and the payments were received through their bankers. The order impugned by virtue of which the
court below has taken cognizance is absolutely bad in the eyes of law and against the law laid down by the Apex Court in case titled Priyanka
Srivastava and another vs State of UP and others, reported in (2015) 6 SCC 287.
4. I have considered the rival contentions of learned counsel for the parties.
5. Learned counsel for the petitioners has reiterated all the grounds taken in the memo of the petition, whereas the learned counsel for the respondent
has opposed the same and stated that the Court below has rightly passed the order.
6. For facility of reference, the relevant extract of impugned complaint reads as under:
“2. That the complainant is a businessman by profession and in connection with establishment of his project in the nature of TATA Showroom at
Lasjan Bypass, Srinagar, the complainant herein received quotations from the accused for construction of the said showroom, the accused as well
deputed the accused no.2 for spot inspection and to confirm the quotations on 29.03.2014, and the complainant in anticipation of the finalization of
drawings issued a cheque from Baramulla on 30.03.2014 as advance amount/token money amounting to Rs.Fifteen Lakh with a firm assurance by the
accused of finalizing the drawings and completion of the project immediately, however the accused failed to complete the drawings till the month of
August 2014, especially when the drawings prepared by them were found technically not feasible to bear the load of snow in winter and was in this
context the complainant besides engaging his own structural engineer had to undertake their own resources for finalizing the drawings on 23/24
August 2014 on receipt of final costing details of the project for purpose of final settlement of the agreement between the parties.
3. That however, since due to delay caused in finalizing the drawings coupled with the fact that the setting up of the project has been rendered
frustrated due to unprecedented floods which in undated the entire city of Srinagar, therefore, the complainant time and again have approached the
accused both personally and by mail for return of the money advanced. It is submitted further that despite of the extending the assurances for return
of the money in due course, no effective steps have been taken by the accused in the matter and continue to retain the mount paid in advance by the
complainant.
4. That the accused are now using all the force and harassment to succumb the complainant by using the agencies and muscle power.
5. That the complainant some days back visited the accused to resolve the matter and get his money back but instead was held hostage by the
accused at their office and was threatened of dire consequences and was given life threats.
6. That the complainant went to the concerned police station but they refused to lodge an FIR on the context of jurisdiction and instead made the
complainant sign some blank papers and the complainant in turn was told to go to the court and hence this application.
7. That the respondent may be strongly dealt under law and strong action may be taken against them.â€
7. On this complaint, JMIC Baramula took cognizance after recording the statements of complainant and issued process against the petitioners for
offences u/s 420, 341 and 506 RPC.
8. Law with regard to inherent power of High court has now been well settled. In AIR 2017 SUPREME COURT 37 in case titled State of Telangana
v Habib Abdullah Jeelani & ors., it is held as under:-
“11. Once an FIR is registered, the accused persons can always approach the High Court under Section 482 CrPC or under Article 226 of the
Constitution for quashing of the FIR. In Bhajan Lal (supra) the two-Judge Bench after referring to Hazari Lal Gupta v. Rameshwar Prasad[7], Jehan
Singh v. Delhi Administration[8], Amar Nath v. State of Haryana[9], Kurukshetra University v. State of Haryana[10], State of Bihar v. J.A.C.
Saldanha[11], State of West Bengal v. Swapan Kumar Guha[12], Smt. Nagawwa v. Veeranna Shivalingappa Konjalgi[13], Madhavrao Jiwajirao
Scindia v. Sambhajirao Chandrojirao Angre[14], State of Bihar v. Murad Ali Khan[15] and some other authorities that had dealt with the contours of
exercise of inherent powers of the High Court, thought it appropriate to mention certain category of cases by way of illustration wherein the
extraordinary power under Article 226 of the Constitution or inherent power under Section 482 CrPC could be exercised either to prevent abuse of the
process of any court or otherwise to secure the ends of justice. The Court also observed that it may not be possible to lay down any precise, clearly
defined and sufficiently channelized and inflexible guidelines or rigid formulae and to give an exhaustive list of myriad cases wherein such power
should be exercised. The illustrations given by the Court need to be recapitulated:-
“(1) Where the allegations made in the first information report or the complaint, even if they are taken at their face value and accepted in their
entirety do not prima facie constitute any offence or make out a case against the accused.
(2) Where the allegations in the first information report and other materials, if any, accompanying the FIR do not disclose a cognizable offence,
justifying an investigation by police officers under Section 156(1) of the Code except under an order of a Magistrate within the purview of Section
155(2) of the Code.
(3) Where the uncontroverted allegations made in the FIR or complaint and the evidence collected in support of the same do not disclose the
commission of any offence and make out a case against the accused.
(4) Where, the allegations in the FIR do not constitute a cognizable offence but constitute only a non-cognizable offence, no investigation is permitted
by a police officer without an order of a Magistrate as contemplated under Section 155(2) of the Code.
(5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis of which no prudent person can ever
reach a just conclusion that there is sufficient ground for proceeding against the accused.
(6) Where there is an express legal bar engrafted in any of the provisions of the Code or the concerned Act (under which a criminal proceeding is
instituted) to the institution and continuance of the proceedings and/or where there is a specific provision in the Code or the concerned Act, providing
efficacious redress for the grievance of the aggrieved party.
(7) Where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for
wreaking vengeance on the accused and with a view to spite him due to private and personal grudge.â€
It is worthy to note that the Court has clarified that the said parameters or guidelines are not exhaustive but only illustrative. Nevertheless, it throws
light on the circumstances and situations where court’s inherent power can be exercised.
12. There can be no dispute over the proposition that inherent power in a matter of quashment of FIR has to be exercised sparingly and with caution
and when and only when such exercise is justified by the test specifically laid down in the provision itself. There is no denial of the fact that the power
under Section 482 CrPC is very wide but it needs no special emphasis to state that conferment of wide power requires the court to be more cautious.
It casts an onerous and more diligent duty on the Court.
9. From bare perusal of relevant paras of the complaint, it is evident that it does not show specific date, time, place and month with regard to incident;
a general averments have been made that some days back he visited the accused to resolve the matter and get his money back but instead was held
hostage by the accused at their office and was threatened of dire consequences and was given life threats.
10. The complaint does not disclose any offence. Date, time, place, month and year of criminal incident are very much essential for taking cognizance,
because on the basis of these averments the court has to frame charge and proceed with trial. As per Section 222 of Chapter XVIII of Cr.P.C., the
charge shall contain particulars as to time, date, place, month, year and manner of alleged offence. All these are missing in the complaint.
11. As per above law in State of Telangana (supra), a complaint is liable to be quashed, if it does not disclose any offence or is frivolous, vexatious or
oppressive; if the allegations set out in complaint do not constitute offence of which cognizance has been taken by Magistrate, then it can be quashed.
12. Perusal of Para 2 of complaint would further reveal that there appears to be some civil dispute with regard to construction of some showroom at
Lasjan Bypass Srinagar.Â
13. It is now well-recognized principle of law that the matter, which essentially involves the dispute of civil nature cannot legally be allowed to become
subject matter of criminal proceeding. It is not a matter of dispute that the jurisdiction of civil and criminal courts is entirely different and distinct from
each other. The matter which squarely falls within the ambit and jurisdiction of the civil court cannot be legally settled in garb of criminal prosecution.
The complainant cannot be permitted to put pressure of a criminal complaint against the petitioners in order to settle civil liability.
14. An identical question came to be decided by the Hon'ble Apex Court in case Indian Oil Corporation v. NEPC India Ltd. & Others (2006) 6 SCC
736 and Hon'ble Supreme Court cautioned about a growing tendency of the people to convert purely civil disputes into criminal cases, in which, it was
noticed the prevalent impression that since the civil law remedies are time consuming and do not adequately protect the interests of lenders/creditors,
so, the people have started to settle civil disputes and claims, which do not involve any criminal offence, by applying the pressure through criminal
prosecution. It was observed that ""such effort should be deprecated and discouragedâ€. The same view was taken by the Hon'ble Apex Court in case
Inder Mohan Goswami & Another v. State of Uttaranchal & Others 2008(1) SCC(Crl.) 259 wherein it was observed that the veracity of the facts
alleged by the complainant can only be ascertained on the basis of evidence and documents by a civil court of competent jurisdiction and if the dispute
in question is purely of a civil nature, in that eventuality, the initiation of criminal proceedings by the complainant against the accused is clearly an
abuse of process of the Court. Not only that, the same very view was again reiterated by the Hon'ble Apex Court in case Joseph Salvaraja v. State of
Gujarat and others (2011) 3 SCC (Crl.) 23, in which, it was ruled as under:-
In our opinion, the matter appears to be purely civil in nature. There appears to be no cheating or a dishonest inducement for the delivery of property
or breach of trust by the appellant. The present FIR is an abuse of process of law. The purely civil dispute, is sought to be given a colour of a criminal
offence to wreak vengeance against the appellant. It does not meet the strict standard of proof required to sustain a criminal accusation. In such type
of cases, it is necessary to draw a distinction between civil wrong and criminal wrong as has been succinctly held by this Court in Devendra v. State
of U.P., (2009) 7 SCC 495, in which, it was held (para 27) that a distinction must be made between a civil wrong and a criminal wrong. When dispute
between the parties constitute only a civil wrong and not a criminal wrong, the courts would not permit a person to be harassed although no case for
taking cognizance of the offence has been made out.
15. In view of above discussion, this petition is required to be allowed. Hence, the complaint pending before court below and process issued thereon,
are quashed.
