Bombay High Court
MANOHAR MAHADEO HAJAREversusMANGAL PRABHAT GUMANMAL LODHA AND ORS.
- Decided
- Disposal
- Disposed Off
Holding
The court upheld the revision court’s judgment and dismissed the writ petition, finding no criminal liability.
Summary
The petitioners, partners of an unregistered partnership firm, alleged that three other partners colluded with Respondent No.1 to execute a Development Agreement in 2003, thereby cheating them out of their share in several land plots. They claimed fraud under Sections 420 and 406 of the Indian Penal Code and sought to set aside the criminal process issued in 2007. The respondents argued that the dispute was purely civil, arising from partnership and contract issues, and that there was no prima facie evidence of cheating by Respondent No.1. The court examined the facts, noting that the Development Agreement and Power of Attorney were duly registered and that the partnership was not registered under the Indian Partnership Act, 1932, rendering the matter a civil dispute. Concluding that no criminal element existed and that the revision court’s findings were correct, the court upheld the earlier judgment and dismissed the writ petition.
Issues considered
- Whether the alleged collusion and exclusion from the Development Agreement constitute cheating under IPC Sections 420 and 406.
- Whether Respondent No.1 can be held criminally liable for the partnership dispute.
- Whether the civil nature of the partnership and unregistered status preclude criminal prosecution.
- Whether the revision court’s order granting process should be set aside.
Legislation cited
- Indian Partnership Act, 1932
- Indian Penal Code, 1860 — s. 406, 420
Subjects
- fraud
- cheating
- partnership dispute
- civil vs criminal jurisdiction
- Indian Penal Code
- Indian Partnership Act
- revision petition
- criminal writ petition
Judgment
WP.183.2009.doc
Ajay
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CRIMINAL APPELLATE JURISDICTION
CRIMINAL WRIT PETITION NO.183 OF 2009
Anjali Manohar Hajare
(since deceased) through L.R.
Manohar Mahadeo Hajare .. Petitioner
Versus
Mangal Prabhat Gumanmal Lodha and Ors. .. Respondents
....................
Mr. Vishwajeet Kapse, Senior Advocate a/w. Mr. Pawan Tiwari,
Advocate for Petitioner.
Mr. Amogh Singh a/w. Mr. Akash Gupta i/b. Jeet Gandhi,
Advocates for Respondent Nos.1 to 6.
Ms. Sangeeta Phad, APP for Respondent – State.
......…...........
CORAM : MILIND N. JADHAV, J.
DATE : AUGUST 18, 2026.
P.C.:
1. Heard Mr. Kapse learned Senior Advocate for Petitioner, Mr.
Singh learned Advocate for Respondent Nos. 1 to 6 and Ms. Sangeeta
Phad, learned APP for Respondent No.7 - State.
2. Criminal Writ Petition No.1839 of 2009 is heard finally
today. This Writ Petition assails judgment dated 07.10.2008 passed in
Revision Application filed by Accused No.5 challenging order dated
13.12.2007 of issuance of process against Accused persons in Criminal
Case No.374 of 2007. By virtue of the impugned order Revision
Application is allowed hence being aggrieved, Complainant has filed
the present Writ Petition.
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3. Mr. Kapse appears for Complainant / Petitioner. Original
complainants have all expired in the interregnum. The present Writ
Petition is prosecuted by legal representative of one of the Original
Complainant.
4. Briefly stated and as argued by Mr. Kapse, original Petitioner
along with 4 others (Respondent Nos.2, 3, 4 and 5) were partners of
partnership firm called M/s. Harinam Enterprises which was formed on
09.10.1986. Original Complainant and Respondent No.2 filed criminal
case against Respondent Nos.1 and 3 to 6 under Sections 420 and 406
of the Indian Penal Code, 1860. Process was issued by order dated
13.12.2007 which was challenged in Revision by Respondent No.1.
This Revision Application was allowed. Mr. Singh represent
Respondent No.1. Hence the present Petition.
5. Mr. Kapse would vehemently argue that notwithstanding the
subsistence of the partnership firm and the said firm having executed
agreement dated 18.10.1986 for purchase of properties being several
plots of land and the said firm having paid almost 50% payment, the
execution of Development Agreement by the other accused persons
with Respondent Nos.1 and 6 in March 2003 is an act of fraud played
upon the Complainants i.e. original Petitioner and Respondent No.2.
He would submit that act of the partners of the partnership firm in
transacting the properties with Respondent No.1 and 6 (Accused Nos.5
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and 6) to the exclusion of original Petitioner and Respondent No.2 and
receiving consideration by them was an act of collusive fraud in
depriving the Complainants of their legitimate right. He would submit
that the Complainants approached Accused No.5 in 2003 and
explained the position to him in view of the stakes of the partners in
the partnership firm but to no avail. He would submit that executing
Development Agreement dated 01.04.2003 by these other partners
(Respondent Nos.3, 4 and 5) of the firm to the exclusion of
Complainants deprived them of their legitimate share as partners in
the said properties under development. Hence such an act amounted
to collusion and cheating.
5.1. He would submit that on 07.12.2005 legal notice was issued
to Respondent No.1 (Accused No.5). He would fairly submit that
Accused No.5 filed Caveat Application in Civil Court apprehending
filing of Civil Suit by Respondent No.1 for seeking injunction. He
would once again fairly concede that Civil Suit was not filed by
Complainants and criminal complaint was filed in the year 2007 in
which process was issued, but in Revision it was set aside.
5.2. The only distinction which he draws to support Petitioners
case on the basis of fraud is that Respondent Nos. 3, 4 and 5 were
erstwhile partners of the firm along with Petitioner and Respondent
No.2 and they executed Development Agreement with Respondent
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No.1 purporting to be owners of the subject properties / plots of land
situated at Thane by giving a complete go-by to the partnership firm
and rights of the other partners namely original Petitioner and
Respondent No.2. He would therefore submit that once it is an agreed
fact that Petitioner and Respondent No.2 were partners of the firm,
then without their consent the other three partners namely Respondent
Nos.3,4 and 5 could not have dealt with the firm’s properties without
their consent and derived any benefit from Respondent No.1. Hence he
would submit that reasons given in the impugned judgment dated
07.10.2008 by the Revision Court namely Additional Sessions Judge
should not be countenanced and the impugned judgment deserves to
be quashed and set aside and order of process dated 13.12.2007 be
restored.
6. PER CONTRA, Mr. Singh on behalf of Respondent No.1
would persuade me to consider the fact that if at all the original
Complainants were indeed concerned about any of their substantive
rights then after giving legal notice on 07.12.2005, after receiving
appropriate reply thereto on 21.09.2006 and after considering
contents of the said reply, there was absolutely no need and necessity
for them to file a criminal complaint against Respondent Nos.1 and 6.
6.1. He would submit that there is no prima facie material placed
on record to show that Respondent No.1 is anywhere concerned with
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the alleged fraud committed by Petitioner. He would submit that inter
se disputes between the partners of the alleged partnership firm are
the real cause of disputes with which Respondent No.1 has no nexus.
He would submit that pursuant to receiving the legal notice,
Respondent No.1 through his advocate informed Complainants that
balance amount shall be deposited by him in Court for safety and
convenience if so required and therefore filed a Caveat. He would
submit that Respondent No.1 has no privity of contract with original
Complainants namely Petitioner and Respondent No.2. He would
submit that Original Complainants chose not to file the Civil Suit for
injunction and instead embarked upon criminal complaint alleging
collusion and fraud when there was complete transparency of the
nexus between the 3 partners of the partnership firm and Respondent
No.1 and the Development Agreement was duly registered along with
registered Power of Attorney. He would persuade Court to consider
that alleged dispute emanates from the partnership agreement and it is
Complainants' own case that when they purchased these properties /
plots of land from third party owners through Agreements to Sale, they
made part payment to them only. He would therefore urge this Court
to uphold judgment dated 07.10.2008 passed by the Revision Court
and dismiss the Petition.
7. I have hard Mr. Kapse learned Senior Advocate for
Petitioner, Mr. Singh learned Advocate for Respondent No.1 and Ms.
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Phad, learned APP for State at length and with their able assistance
perused the record.
8. Admittedly and essentially it is seen that the partnership firm
had entered into Agreement to Sale and purchase with regard to the
properties / plots of land and had made partial payments only. It is
prima facie seen that for may years the said Agreements to Sale in
regard to the various plots never ever fructified. It is seen that most of
the owners of the subject plots thereafter executed separate Power of
Attorney in favour of Respondent Nos.3, 4 and 5. It is also seen that
these original land owners executed separate Deed of Confirmation
with Respondent No.1 qua their respective plots on receiving
consideration from Respondent No.1 by way of cheques against the
said Agreements. What is crucial is that statutory permissions from the
Collector to certify and permit the sale transaction were all obtained by
Respondent No.1 thereafter in accordance with law, development of
the various plots took place by putting up construction of commercial
and residential buildings thereon, cooperative housing societies were
formed and the construction is now almost complete. All these are
therefore essentially civil disputes, if raised, qua the substantive rights
of the parties in the said lands. Prima facie, when such facts are
conceived there is no element of criminality whatsoever qua
Respondent No.1 and 6 when the entire development took place with
open eyes. What prevented the Petitioner from approaching the Civil
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Court to protect her substantive rights can only be answered by her.
9. What is shocking in the first place is that the alleged
partnership firm wherein original Petitioner claims to be a partner is
not even registered under the Indian Partnership Act, 1932 when the
claim is that partners entered into agreement to purchase properties /
plots of land. At the highest, claim of original Petitioner that she is one
of the partners qua the unregistered partnership firm for breach of any
terms of the agreement can therefore lie only against the other
partners, if any, and is in the nature of civil dispute. The original
Complainants have no nexus with Respondent No.1, therefore if
breach of agreement of partnership firm is claimed then their remedy
is to file civil suit against the other partners for settlement of accounts
and most importantly injunction if interference is objected to by any
partner. What is shocking is that Complainant had specific knowledge
about the transaction of 2003 namely Development Agreement but for
more that 4 years chose not to take any steps. The Revision Court
returned specific findings that no element of cheating or breach of
contract exists qua Respondent No.1. There is nothing brought on
record to show common intention and cheating by Respondent No.1. It
is seen that Development Agreement dated 01.04.2003 and Power of
Attorney dated 01.04.2003 were all executed and registered
documents. What is most surprising is the fact that the original
agreement dated 01.04.2003 was executed by the original landlord
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with HN Enterprises which is not the same as the partnership firm of
Harinam Enterprises as Petitioner is attempting to draw similarity of
names and is pleading fraud.
10. In that view of the matter and the observations and findings
returned in paragraph Nos. 7 and 8 in the impugned judgment dated
07.10.2008, I am of the clear opinion that no interference whatsoever
is called upon to interfere in the findings returned by the Revision
Court. Consequentially, judgement dated 07.10.2008 is upheld and
confirmed.
11. Resultantly, Writ Petition is therefore dismissed.
12. Writ Petition is dismissed and disposed of.
[ MILIND N. JADHAV, J. ]
Digitally signed
Ajay by RAVINDRA
RAVINDRA MOHAN
AMBERKAR
MOHAN Date:
AMBERKAR 2026.08.18
11:31:59
+0530
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