Supreme Court of India
RAJESHWAR TIWARI AND ORS.versusNANDA KISHORE ROY
- Citation
- 2010 INSC 532
- Decided
- 19 August 2010
- Disposal
- Appeal(s) allowed
- Bench
- P SATHASIVAM
Holding
The Supreme Court held that the complaint does not disclose any criminal offence and the High Court erred in not exercising Section 482 CrPC; therefore the criminal proceedings were quashed.
Summary
The employee, Nanda Kishore Roy, complained that his employer had wrongfully deducted Rs.1,640 per month as income tax and failed to deposit it, leading a magistrate to issue summons under sections 406/1208 IPC. The employer argued that the deductions were mandated by the Income Tax Act and that the complaint was essentially civil. The High Court dismissed the employer's petition under Section 482 CrPC without reasoning, allowing the criminal proceedings to continue. The Supreme Court examined the statutory provisions and police reports, finding the complaint did not disclose any criminal offence and was a civil grievance. It held that the High Court erred in not exercising its inherent jurisdiction to quash the proceedings. Consequently, the criminal proceedings were quashed and the appeal was allowed.
Issues considered
- The complaint under sections 406 and 1208 IPC discloses a criminal offence or is merely a civil dispute.
- Whether the High Court should have exercised its inherent power under Section 482 CrPC to quash the criminal proceedings.
- Whether the employer's deduction of tax pursuant to the Income Tax Act constitutes a criminal act.
- Whether the magistrate was justified in issuing summons based on the complaint.
Legislation cited
- Code of Criminal Procedure, 1973s. 482
- Income Tax Act, 1961s. 192, s. 199, s. 200, s. 206, s. 271C, s. 2768, s. 2768BB
- Indian Penal Code, 1860s. 1208, s. 406
Subjects
Section 482 CrPCquashing of criminal proceedingscivil nature of disputeincome tax deduction at sourceabuse of processemployer-employee disputetax lawcriminal complaint
Judgment
[2010] 10 S.C.R. 444
A RAJESHWAR TIWARI AND ORS.
v.
NANDA KISHORE ROY
(Criminal Appeal No. 779 of 2007)
AUGUST 19, 2010
B
[P. SATHASIVAM AND DR. B.S. CHAUHAN, JJ.]
Code of Criminal Procedure, 1973 - s.482 - Exercise of
powers under - Quashing of complaint - Employee filed
C complaint against the employer alleging discrimination on the
basis that an amount per month was wrongfully deducted from
his salary as income tax and was not deposited to the income
tax authority month by month - Magistrate directed issuance
of summons against the employer for offence punishable ul
D ss. 40611208 /PC - Employer filed petition uls.482 CrPC for
quashing of the complaint which was dismissed by the High
Court- Held: The proceedings initiated by the employee were
of a civil nature, and same, if adjudicated by the Magistrate
would be an abuse of process of court - The High Court
E committed an error, firstly, in not assigning any reason and
passing a cryptic order and, secondly, in failing to exercise
its jurisdiction u/s. 482 CrPC when the complaint did not
disclose any offence of criminal nature - Criminal
proceedings pending before the Magistrate, accordingly,
F quashed - Penal Code, 1860 - ss. 120-8 and 406 - Income
Tax Act, 1961 - SS. 192, 200, 206, 271C and 2768-88.
The respondent-employee filed a complaint against
the appellants-employer alleging discrimination on the
basis that an amount of Rs.-1,640/- per month, was
G wrongfully deducted from his monthly salary as Income
Tax and not deposited to the income tax authority month
by month. The Magistrate directed issuance of summons
against the appellants for offence punishable u/ss. 406/
H 444
RAJESHWAR TIWARI AND ORS. v. NANDA KISHORE 445
ROY
1208 IPC. The appellants filed a petition u/s. 482 Cr.P.C A
for quashing of the complaint. The application was
dismissed by the High Court.
The employer filed the instant appeal contending that
in view of the statutory provisions of the Income Tax Act, B
1961, particularly, Sections 192, 200, 206, 271C and 2768-
88, like other employees, the respondent was liable to
pay income tax and the appellants as employers were
statutorily bound to deduct an amount from his salary as
per the said provisions; that inasmuch as the appellants C
performed their statutory obligation, it was not a case for
adjudication by the Magistrate on the criminal side and
further that the High Court also failed to exercise its
jurisdiction under Section 482 Cr.P.C in not quashing the
summoning order.
D
Allowing the appeal, the Court
HELD:1. It is not clear how the Judicial Magistrate
concluded that "there is sufficient ground for proceeding
against the accused under Section 406/120 8 IPC", more E
particularly, when the inquiry report by the SI shows that
the issue raised in the complaint is civil in nature. From
the materials placed, particularly, the contents of the
complaint, relevant statutory provisions of the Income
Tax Act, report of the SI, it is clear that the complaint does
not disclose any case to proceed against the accused F
persons as arrived by the Judicial Magistrate. It was not
a case for criminal prosecution. If the respondent was
very much interested to vindicate his grievance, he could
have very well approached the officer concerned (in the
employer-organisation) or to the Income Tax authority G
concerned. [Para 11 and 12] (456-A-F]
2.1. Though the inherent jurisdiction under Section
482 Cr.P.C. has to be exercised sparingly, carefully and
H
446 SUPREME COURT REPORTS [2010] 10 S.C.R.
A with caution, but when adequate materials are available
which clearly show that the proceeding is either of civil
nature, cannot be adjudicated by the criminal court, or it
is an abuse of process of court, the High Court is well
within its power to exercise its inherent jurisdiction and
B quash the same. [Para 14] [457-B-C]
2.2. In the instant case, the High Court committed an
error, firstly, in not assigning any reason and passing a
cryptic order in one line without adverting to any of the
C relevant materials and, secondly, it failed to exercise its
jurisdiction under Section 482 Cr.P.C when the complaint
does not disclose any offence of criminal nature. In view
of the statutory provisions of the Income Tax Act and the
assertion of the appellants that deductions were being
made for all the persons who are liable to pay tax in terms
D of the Income Tax Act, the proper remedy for the
respondent is to approach the authority/officer
concerned and not by filing the complaint. The High
Court committed an error in not exercising its jurisdiction
and dismissing the petition filed under Section 482
E Cr.P.C. Consequently, the criminal proceedings pending
before the Magistrate initiated against the appellants are
quashed. [Paras 21, 22] [460-G-H; 461-A-D]
Nagawwa v. Veeranna Shivalingappa Konjalgi (1976) 3
F SCC 736; State of Haryana v. Bhajan Lal 1992 Supp. (1)
SCC 335; Sardar Trilok Singh and others v. Satya Deo
Tripathi (1979) 4 SCC 396; G. Sagar Suri and another v. State
of UP. and others (2000) 2 SCC 636; A/pie Finance Ltd. vs.
P. Sadasivan and another (2001) 3 sec 513 and Indian Oil
G Corporation vs. NEPC India Ltd. and Others (2006) 6 SCC
736 - relied on.
Case Law Reference:
(1976) 3 sec 736 relied on Para 15
H
RAJESHWAR TIWARI AND ORS. v. NANDA 44 7
KISHORE ROY
1992 Supp. (1) SCC 335 relied on Para 16 A
(1979) 4 sec 396 relied on Para 17
(2000) 2 sec 636 relied on Para 18
(2001 > 3 sec 513 relied on Para 19
B
(2006) 6 sec 736 relied on Para 20
CRIMINAL APPELLATE JURISDICTION: Criminal Appeal
No. 779 of 2007.
From the Judgment & Order dated 31.01.2007 of the High C
Court of Calcutta in C.R.R. No. 2774 of 2005 with C.R.R. No.
2772 of 2005.
Ranjit Kumar, Sunil Kumar Jain, Aneesh Mittal for the
Appellants. D
Yashank Adhyaru, Anindita Gupta, Rajesh Srivastava for
the Respondent.
The Judgment of the Court was delivered by
E
P. SATHASIVAM, J. 1. This appeal is directed against the
final order dated 31.01.2007 passed by the High Court of
Calcutta in C.R.R. No. 2774 of 2005 with C.R.R. No. 2772 of
2005 whereby the High Court dismissed the applications filed
under Section 482 of the Criminal Procedure Code (hereinafter F
referred to as 'the Code') by the appellants to quash the criminal
proceedings pending before the Judicial Magistrate, 2nd Court,
Asansol, being Case No. C/438 of 2003 under Section 406/
1208 of IPC corresponding to T.R. No. 167 of 2003.
2. The facts leading to the present appeal are as under: G
(a) In 1973, the respondent joined the Indian Iron and Steel
Company Ltd., (renamed llSCO Steel Plant), a unit of Steel
Authority of India Ltd., at Burnpur, near Asansol in West Bengal.
H
448 SUPREME COURT REPORTS [2010] 10 S.C.R.
A In 1989, he was appointed as Assistant Foreman. In 1991 he
filed a writ petition being C.O. No. 9954(W) of 1991 before the
High Court of Calcutta seeking direction for considering his
claim for promotion to the post of Senior Mechanic alleging that
he was superseded by his juniors. On 19.01.1995, the
8 respondent filed another writ petition praying for interim order
restraining the appellants from filling up the post of Assistant
Foreman. The High Court, in the said writ petition, directed for
maintaining status quo. In June 1996, the respondent filed a
contempt petition on the ground of violating the said status quo
C order by the appellants herein. In the said contempt petition,
the High Court directed for personal appearance of the
concerned officers of the Company and ultimately after hearing
them, dismissed the contempt petition.
(b) On 06.12.2003, the respondent filed a private complaint
D being C/438 of 2003 before the Additional Chief Judicial
Magistrate, Asansol under Sections 461/468/406 read with
Section 1208 of IPC against the appellants herein alleging
discrimination by unduly deducting Rs.1,640/- p.m. from the
monthly salary as Income Tax. It was also stated in the
E complaint that the amount so deducted was not deposited with
the Income Tax Authority and should be refunded back. It was
also mentioned in the complaint about the wrongful deduction
of the amount on account of cooperative loan issued by the
appellants/Company. On examination of the witnesses under
F Section 200 of the Code of Criminal Procedure, the Magistrate
directed the Officer-in-Charge P.S. Hirapur to cause an inquiry
into the allegations made in the complaint. On 30.04.2004, the
appellants informed that the amount of income tax deducted in
consonance with Section 192 of the Income Tax Act being
G deposited in due course as tax to the credit of employee/
respondent in terms of Section 199 of the Income Tax Act as
uniformly done in respect of every employee and also produced
Form No-16 of the respondent for the period from 01.04.2003
to 31.03.2004. On 15.07 .2004 & 30.01.2005, the police
H
RAJESHWAR TIWARI AND ORS. v. NANDA KISH0RE 449
ROY [P. SATHASIVAM, J.]
submitted two inquiry reports, inter a/ia, stating the previous A
conduct of the respondent and also stated that the complaint
in issue is civil in nature. On 31.01.2005, after taking into
consideration the inquiry reports of the police, the Judicial
Magistrate, Asansol directed issuance of summons against the
appellants for an offence under Section 406/1208 of the Indian B
Penal Code. In response to the summons, the appellants made
an application under Section 205 of the Code before the
Judicial Magistrate and the same was rejected by an order
dated 26.07.2005. Subsequently, vide order dated 12.09.2005,
the Judicial Magistrate issued warrant of arrest against the c
appellants. The appellants filed application being C.R.R. No.
2774 of 2005 before the High Court of Calcutta under Section
482 of the Code for quashing of the complaint and prayed for
staying of proceedings in the complaint bearing No. C/438 of
2003. The appellants also filed another application under D
Section 482 being C.R.R. No. 2772 of 2005 seeking quashing
of the order dated 12.09.2005. The High Court, by order dated
31.01.2007, rejected the prayer for quashing the criminal
proceedings and disposed of both the applications with a
direction to the trial Court to dispose of the matter within a
E
period of six months. Aggrieved by the same, the appellants
have preferred this appeal by special leave before this Court.
3. Heard Mr. Ranjit Kumar, learned senior counsel for the
appellants and Mr. Yashank Adhyaru, learned senior counsel
for the respondent. F
4. In order to test the claim of both the parties as well as
the correctness of the impugned order of the High Court, it is
useful to refer the details of the complaint dated 06.12.2003
filed by the respondent. He described himself as an employee G
of ME Steel, llSCO, Burnpur and he made the following officers
as accused persons:
1. A.K. Jaiswas EDl/C.Cum M.D. llSCO Ltd. Burnpur
Works
H
450 SUPREME COURT REPORTS [2010] 10 S.C.R.
A 2. Rajeswar Tiwari GM [P&A]
3. Robin Roy DGM (MM) SMS Deptt.
4. P. Karmakar, AGM [MM] SMS Deptt.
B 5. Sukumar Mukherjee, Manager Finance
6. Shivaji Roy DGM [PL]
7. Tarit Pal GM [IS]
C All are of llSCO Burnpur PS Hirapur Distt. Burdwan
In the complaint, he mentioned about the filing of writ petition
in 1991 before the High Court of Calcutta and the order passed
therein in 2003. He also referred to his contempt petition before
the High Court. He alleged that due to the direction of the High
0
Court, which was issued at his instance, the abovesaid officers
entered into a criminal conspiracy and with a view to pressurize
him for withdrawing the said contempt, starting giving threats
to him in various manners. According to him, due to such
attitude towards him, the accused persons with a view to get
E their object fulfilled, started illegal deduction of Rs. 1640/- per
month from his monthly salary as income tax w.e.f. May 2003.
In this way, the accused persons had deducted an amount of
Rs. 13, 120/- from his salary on account of income tax and the
said amount had not been deposited with the income tax
F authority. The appellant also stated that he does not fall within
the category of taxable income, and in any event, not to the tune
of Rs. 1640/. He also claimed that he sent a notice under
registered post with acknowledgement due on 17 .11.2003 to
accused Nos. 1 to 5 requesting them to return the money so
G deducted illegally from his salary. On receipt of the notice, the
accused persons abused him in the presence of witnesses and
others and also threatened him with dire consequences. He
also pointed out that a sum of Rs. 3050/- had been deducted
from his salary illegally on account of cooperative loan although,
H on the previous month, deduction was only to the extent of Rs.
RAJESHWAR TIWARI AND ORS. v. NANDA 451
KISHORE ROY [P. SATHASIVAM, J.]
50. With these allegations, he claimed that accused persons A
have committed offence under Sections 467, 468, 403 and 406
read with Section 1208 IPC and prayed for issuance of
summons.
5. We have adverted to almost all the averments/
8
allegations made by the respondent herein in respect of
accused nos. 1 to 5 who are appellants before us. From this,
we are able to understand that the respondent has grievance
against the management in respect of his non promotion at the
relevant time, moving to the High Court of Calcutta, obtaining
certain orders, filing of contempt petition etc. It is also alleged C
that the appellants have deducted income tax to the extent of
Rs. 1,640/- per month from his monthly salary as income tax
but according to the respondent, he was not liable to pay
income tax.
D
6. Mr. Ranjit Kumar, learned senior counsel for the
appellants has pointed out that there is no lapse on their part
in respect of the allegation relating to non promotion of the
respondent. In fact, according to him, the respondent had been
held guilty by the CBI in a case for using fabricating documents E
for the purpose of promotion. He also pointed out that though
the High Court has permitted to take action against him
according to law, the management did not take any action
against him. He also pointed out that in view of statutory
provisions of the Income Tax Act, particularly, Sections 192,
F
200, 206, 271 C and 2768-BB, like other employees, the
respondent was liable to pay income tax and the appellant as
an employer statutorily bound to deduct an amount from his
salary as per the above provisions. Whatever may be, inasmuch
as appellants have performed their statutory obligation, it is not
a case for adjudication by the Magistrate on criminal side. He G
further contended that the High Court also failed to exercise its
jurisdiction under Section 482 for quashing the summoning
order. On the other hand, Mr. Yashank Adhyaru supported the
order of the Magistrate based on the complaint of the
H
452 SUPREME COURT REPORTS [2010] 10 S.C.R.
A respondent and also submitted that the High Court has not
committed any wrong in rejecting the petition under Section 482
of the Code.
7. At the relevant time, i.e on 06.12.2003, when the
respondent made a complaint to the Magistrate, he was an
B employee of llSCO, Burnpur. There is no dispute about the
same.
8. Chapter XVII of the Income Tax Act deals with Collection
and Recovery of Tax. Section 192 speaks about deduction at
C source from Salary.
"192. (1) Any persQn responsible for paying any income
chargeable under the head "Salaries" shall, at the time of
payment, deduct income-tax [***] on the amount payable
at the average rate of income-tax [***] computed on the
D
basis of the [rates in force] for the financial year in which
the payment is made, on the estimated income of the
assessee under this head for that financial year."
Section 200 relates to duty of person deducting tax.
E
"200. (1) Any person deducting any sum in accordance
with [the foregoing provisions of this Chapter shall pay
within the prescribed time, the sum so deducted to the
credit of the Central Government or as the Board directs.
F (2) Any person being an employer, referred to in sub-
section (1A) of section 192 shall pay, within the prescribed
time, the tax to the credit of the Central Government or as
the Board directs.
G (3) Any person deducting any sum on or after the 1st day
of April, 2005 in accordance with the foregoing provisions
of this Chapter or, as the case may be, any person being
an employer referred to in sub-section (1A) of section 192
shall, after paying the tax deducted to the credit of the
H Central Government within the prescribed time, [prepare
RAJESHWAR TIWARI AND ORS. v. NANDA KISHORE 453
ROY [P. SATHASIVAM, J.]
such statements for such period as may be prescribed] A
and deliver or cause to be delivered to the prescribed
income-tax authority or the person authorised by such
authority such statement in such form and verified in such
manner and setting forth such particulars and within such
time as may be prescribed." B
Section 206 mandates persons deducting tax to furnish
prescribed returns.
"206. (1) The prescribed person in the case of every office
of Government, the principal officer in the case of every C
company, the prescribed person in the case of every local
authority or other public body or association, every private
employer and every other person responsible for dE?ducting
tax [before the 1st day of April, 2005] under the foregoing
provisions of this Chapter [shall, within the prescribed time D
after the end of each financial year, prepare and deliver
or cause to be delivered] to the prescribed income-tax
authority [or such other authority or agency as may be
prescribed, such returns in such form and verified in such
manner and setting forth such particulars as may be E
prescribed:"
Section 271 C deals with penalty for failure to deduct tax at
source.
. " 271C. [(1) If any person fails to- F
(a) deduct the whole or any part of the tax as
required by or under the provisions of Chapter XVll-
B; or
(b) pay the whole or any part of the tax as required G
by or under-
(1) sub-section (2) of section 115-0; or
(i1) the second proviso to section 1948, H
454 SUPREME COURT REPORTS [2010] 10 S.C.R.
A then, such person shall be liable to pay, by way of penalty,
a sum equal to the amount of tax which such person failed
to deduct or pay as aforesaid."
Section 276 B and 276 BB speaks about failure to pay tax to
the credit of Central Government and failure to pay the tax
8
collected at source.
"2768. If a person fails to pay to the credit of the Central
Government,-
(a) the tax deducted at source by him as required
c by or under the provisions of Chapter XVll-B; or
(b) the tax payable by him, as required by or
under-
(1) sub-section (2) of section 115-0; or
D
(i1) the second proviso to section 1948,
he shall be punishable with rigorous imprisonment for a
term which shall not be less than three months but which
may extend to seven years and with fine.
E
27688. If a person fails to pay to the credit of the Central
Government, the tax collected by him as required under the
provisions of section 206C, he shall be punishable with
rigorous imprisonment for a term which shall not be less
F than three months but which may extend to seven years
and with fine."
9. A glance of these provisions make it clear that it is
obligatory on the part of the persons responsible for paying any
income chargeable under the head "salaries", at the time of
G payment, deduct income tax computed on the basis of the rates
in force for the financial year on the estimated income of the
assessee and pay the same to the authority concerned. It also
make clear that failure to deduct tax at source shall be liable
to pay, by way of penalty, a sum aqual to the amount of tax
H which such person failed to deduct or pay. It also shows that
RAJESHWAR TIWARI AND ORS. v. NANDA KISHORE 455
ROY [P. SATHASIVAM, J.]
failure to pay tax to the credit of Central Government in certain A
cases or pay the tax collected at source under Section 276 88
shall be punishable with imprisonment.
10. In the case on hand, it is the categorical stand of the
appellants-management that the amount of tax that has been 8
deducted from the respondent's salary as TDS under the head
"Salaries" in terms of Section 192 is uniformly done in respect
of each and every employee of the company ..It is also asserted
that the amount of tax so deducted, deposited to the credit of
the employees including the respondent in terms of Section 199. C
They also produced a copy of Form No-16 being the certificate
under Section 203 of the Income Tax Act, 1961 for the tax
deducted at source from the income chargeable under the head
"salaries" in respect of the respondent relating to period from
April 1st, 2003 to March 31st, 2004.
D
11. In the light of the factual scenario, let us see the initial
direction of the Judicial Magistrate, Asansol to the 10
concerned, the report of the police officer as well as ultimate
order dated 31.01.2005 by the Additional Chief Judicial
Magistrate issuing summons upon the appellants/accused E
persons for offence under Section 406 read with 1208 IPC in
terms of Section 204 of the Code. When the complaint was
forwarded to the SI Hirapur, Police Station, he conducted an
inquiry, recorded statements of llSCO officials, perused the
documents concerned and also noted that the tax was deducted F
as per their company norms. After making such a note, the SI
Hirapur has concluded that "the matter is civil in nature" and
forwarded the same to Additional CJM with a request to clarify
the same. On the basis of the said report, by order dated
31.01.2005, the Additional CJM, after recording the stand of G
the complainant about illegal deduction of Rs. 1640/- per month
from his salary as income tax and the same had not been
deposited by the accused persons to the income tax authority
month by month, has concluded "on perusal of the same, it
appears to me that there is sufficient ground for proceeding H
456 SUPREME COURT REPORTS [2010] 10 S.C.R.
A against the accused persons under Section 4061120 8 /PC."
First of all, it is not clear how the Additional CJM has concluded
that "thete is sufficient ground for proceeding against the
accused under Section 406/120 B IPC", more particularly,
when the inquiry report by the SI Hirapur shows that the issue
B raised in the complaint is civil in nature.
12. We have already adverted to the relevant provisions
from the Income Tax Act, particularly, duty of the employer in
deducting tax at source and forwarding the same to the authority
concerned i.e. to the credit of Central Government as well as
C failure to do so results in prosecution. From the materials
placed, particularly, the contents of the complaint, relevant
statutory provisions of the Income Tax Act, report of the SI
Hirapur, we are of the view that the complaint does not disclose
any case to proceed against the accused persons as arrived
D by the Additional CJM. Even if the respondent had some
grievance with the appellants about non-promotion, direction of
the High Court, pendency of contempt etc. it is not a case for
crimin~I prosecution. If he is very much interested to vindicate
his grievance, the respondent could have very well approached
E the officer concerned of the llSCO or to the IT authority
concerned. Though in the complaint, it is stated that the
respondent had sent a notice under registered post with
acknowledgment due on 17.11.2003, admittedly, no such proof
had been placed before the Court. In fact, the appellants stoutly
F denied the receipt of such a notice.
13. lnspite of all the details and materials since the
Additional CJM issued summons, the appellants approached
the High Court under Section 482 of the Code for quashing the
G same. The High Court, by the impugned order, without
adverting to any of the above mentioned relevant materials
passed a cryptic order in one line "I am not inclined to quash
the criminal proceeding pending before the Additional CJM,
Asansol". No doubt, after dismissing the petition issued certain
directions for protection relating to personal appearance of the
H
RAJESHWAR TIWARI AND ORS. v; NANDA KISHORE 457
ROY [P. SATHASIVAM, J.]
appellants before the Magistrate. A
14. This Court, in a series of decisions, has emphasized
the inherent power of the High Court to pass appropriate orders
to prevent the abuse of process of court or to secure the ends
of justice. Though, inherent jurisdiction under Section 482 has 8
to be exercised sparingly, carefully and with caution when
adequate materials are available which clearly shows that the
proceeding is either of civil nature, cannot be adjudicated by
the criminal court or if it is an abuse of process of court, the
High Court is well within its power to exercise its inherent C
jurisdiction and quash the same.
15. Contours of the power under Section 482 CrPC have
been explained in a series of decisions by this Court. In
Nagawwa v. Veeranna Shivalingappa Konja/gi, (1976) 3 SCC
736, it was held that the Magistrate while issuing process D
against the accused should satisfy himself as to whether the
allegations in the complaint, if proved, would ultimately end in
the conviction of the accused. It was held that the order of
Magistrate issuing process against the accused could be
quashed under the following circumstances: E
"(1) Where the allegations made in the complaint or the
statements of the witnesses recorded in support of the
same taken at their face value make out absolutely no case
against the accused or the complaint does not disclose
F
the essential ingredients of an offence which is alleged
against the accused;
(2) Where the allegations made in the complaint are
patently absurd and inherently improbable so that no
prudent person can ever reach a conclusion that there is G
sufficient ground for proceeding against the accused;
(3) Where the discretion exercised by the Magistrate in
issuing process is capricious and arbitrary having been
based either on no evidence or on materials which are
H
458 SUPREME COURT REPORTS [2010) 10 S.C.R.
A wholly irrelevant or inadmissible; and
(4) Where the complaint suffers from fundamental legal
defects, such as, want of sanction, or absence of a
complaint by legally competent authority and the like."
B 16. In State of Haryana vs. Bhajan Lal, 1992 Supp. (1)
sec 335, a question came up for consideration as to whether
quashing of the FIR filed against the respondent Bhajan Lal for
the offences under Sections 161 and 165 IPC and Section 5(2)
of the Prevention of Corruption Act was proper and legal.
C Reversing the order passed by the High Court, this Court
explained the circumstances under which such power could be
exercised. Apart from reiterating the earlier norms laid down
by this Court, it was further explained that such power could be
exercised where allegation made in the FIR or complaint are
D 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. No doubt,
at the stage of quashing an FIR or complaint the High Court is
not justified in embarking upon an inquiry as to the probability,
E reliability or genuineness of the allegation made therein.
17. In Sardar Trilok Singh and others vs. Satya Deo
Tripathi (1979) 4 SCC 396, when the financer seized the truck
in question due to default in payment of instalment, buyer of the
F vehicle launched criminal prosecution, this Court held it as an
abuse of process of the court since the dispute was essentially
·of a civil nature and quashed the entire proceedings.
18. In G. Sagar Suri and another vs. State of U.P. and
others, (2000) 2 SCC 636, this Court has held:-
G
"8. Jurisdiction under Section 482 of the Code has to be
exercised with great care. In exercise of its jurisdiction the
High Court is not to examine the matter superficially. It is
to be seen if a matter, which is essentially of a civil nature,
has been given a cloak of criminal offence. Criminal
H
RAJESHWAR TIWARI AND ORS. v. NANDA KISHORE 459
ROY [P. SATHASIVAM, J.]
proceedings are not a short cut of other remedies A
available in law. Before issuing process a criminal court
has to exercise a great deal of caution. For the accused
it is a serious matter. This Court has laid certain principles
on the basis of which the High Court is to exercise its
jurisdiction under Section 482 of the Code. Jurisdiction B
under this section has to be exercised to prevent abuse
of the process of any court or otherwise to secure the ends
of justice."
19. In A/pie Finance Ltd. vs. P. Sadasivan and another
(2001) 3 sec 513, this court reiterated that the complaint must C
disclose essential ingredients of the offence. After adverting to
Nagawwa (supra), and State of Haryana vs. Bhajan Lal (supra),
and after finding that in the complaint there is no allegation that
there was fraud or dishonest inducement on the part of the
respondents and thereby the respondents parted with the D
property, it is trite law and common sense that an honest man
entering into a contract is deemed to represent that he has the
present intention of carrying it out but if, having accepted the
pecuniary advantage involved in the transaction, he fails to pay
his debt, he does not necessarily evade the debt by deception, E
upheld the order of the High Court quashed the proceedings
and dismissed the appeal.
20. In Indian Oil Corporation vs. NEPC India Ltd. and
Others, (2006) 6 SCC 736, the following paragraphs are F
relevant:-
"13. While on this issue, it is necessary to take notice of
a growing tendency in business circles to convert purely
civil disputes into criminal cases. This is obviously on
account of a prevalent impression that civil law remedies G
are time consuming and do not adequately protect the
interests of lenders/creditors. Such a tendency is seen in
several family disputes also, leading to irretrievable
breakdown of marriages/families. There is also an
impression that if a person could somehow be entangled H
460 SUPREME COURT REPORTS [2010] 10 S.C.R.
A in a criminal prosecution, there is a likelihood of imminent
settlement. Any effort to settle civil disputes and claims,
which do not involve any criminal offence, by applying
pressure through criminal prosecution should be
deprecated and discouraged.
B
"It is to be seen if a matter, which is essentially of a
civil nature, has been given a cloak of criminal offence.
Criminal proceedings are not a short cut of other remedies
available in law. Before issuing process a criminal court
has to exercise a great deal of caution. For the accused
c it is a serious matter. This Court has laid certain principles
on the basis of which the High Court is to exercise its
jurisdiction under Section 482 of the Code. Jurisdiction
under this section has to be exercised to prevent abuse
of the process of any court or otherwise to secure the ends
D of justice."
14. While no one with a legitimate cause or grievance
should be prevented from seeking remedies available in
criminal law, a complainant who initiates or persists with
E a prosecution, being fully aware that the criminal
proceedings are unwarranted and his remedy lies only in
civil law, should himself be made accountable, at the end
of such misconceived criminal proceedings, in
accordance with law. One positive step that can be taken
F by the courts, to curb unnecessary prosecutions and
harassment of innocent parties, is to exercise their power
under Section 250 CrPC more frequently, where they
discern malice or frivolousness or ulterior motives on the
part of the complainant."
G 21. In the light of the above mentioned well established
principles, we are of the view that the High Court has committed
an error, firstly, in not assigning any reason and passing a
cryptic order and secondly, failed to exercise its jurisdiction
under Section 482 when the complaint does not disclose any
H offence of criminal nature. For the sake of repetition, we
RAJESHWAR TIWARI AND ORS. v. NANDA 461
KISHORE ROY [P. SATHASIVAM, J.]
reiterate, though the respondent had some grievance about his A
non promotion, certain orders passed by the High Court
including filing of contempt etc., in view of the statutory
provisions of the Income Tax Act, the assertion of the appellants
that deductions were being made for all the persons who are
liable to pay tax in terms of the Income Tax Act, the proper B
remedy for the respondent is to approach the authority/officer
concerned and not by filirig complaint as mentioned above. We
have already adverted to the report of SI Hirapur holding that
the matter in issue is civil in,nature.
22. Considering all these materials and in the light of the C
various principles enunciated, we hold that the High Court
committed an error in not exercising its jurisdiction and
dismissing the petition filed under Section 482. Consequently,
we quash the criminal proceedings pending before the trial
Court being Case No. C/438 of 2003 initiated against the D
appellants. The criminal appeal is allowed.
B.B.B Appeal allowed.
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