S.P. GUPTAversusASHUTOSH GUPTA

                          (2010] 7 S.C.R. 38


A                          S.P. GUPTA
                                 v.
                       ASHUTOSH GUPTA
          (Special Leave Petition (Crl.) No. 1953 of 2008)
                            MAY 13, 2010
B
           [ALTAMAS KABIR AND ANIL R. DAVE, JJ.]

         Code of Criminal Procedure, 1973:

c        s.482 - Quashing of complaint - Complaint filed under
    s. 420 r. w. s. 120-B !PC - Assertions made in the complaint
    regarding misrepresentation made by petitioner as regards
    the property in dispute - Summons issued against petitioner
    - Petition for quashing the complaint - High Court dismissing
0   the same - Justification of - He/d.· Justified as prima facie
    case was made out in the complaint for trial of petitioner - The
    complaint gave rise to triable issues which could only be
    determined by leading evidence at the trial - Penal Code,
    1860 - ss.415, 120-B.

          A complaint was filed against the petitioner and the
   other co-accused by the father of respondent under
   Section 420 r.w. Section 1208 IPC. The trial court issued
   summons on the petitioner, and the accused no.1 and 4.
   The revisionary court refused to interfere with the order
F .~oJ trial court. Petitioner moved application under Section
   482.Cr.P.C. before the High Court for quashing of the
   complaint. High Court dismissed the said application
   holding that a prima facie case was made out in the
   complaint against the petitioner for the alleged offences.
G The High Court noted that the petitioner was integral to
   all the transactions that took place between the
   complainant and the accused No.1 as he was the
   constituted attorney of the said accused and therefore
   whether he acted with dishonest intentions or whether
H                                 38
         S.P. GUPTA v. ASHUTOSH GUPTA                   39

he himself gave assurance as to the title of the accused     A
no.1 at the time of execution of the agreement for sale
were matters that raised triable issues and could only be
determined by leading evidence at the trial. Aggrieved
petitioner filed the special leave petition.
                                                             B
    Dismissing the special leave petition, the Court

      HELD: A prima facie case was made out in the
complaint to go to trial. There was a positive assertion in
the complaint that an assurance was given by the
petitioner to the complainant that the property in question C
was free from all encumbrances and that the accused
No.1 was the sole owner of the property. It was
mentioned in the complaint that had such a
representation been not made relating to the status of
ownership of the property in question, the complainant o
would have not entered into the transaction at all.
Whether or not the petitioner was truly mistaken with
regard to the information given by him is a question of
utmost importance in answering a charge of the nature
indicated in the complaint. Merely because the petitioner E
had received part payment of th~ consideration amount
and had made over the same fo the accused no.1 and
merely because possession of the land was handed over
by him to the complainant, cannot form the basis of a
presumption that he had no knowledge that there was a
                                                               F
dispute regarding the ownership of the property, as to
whether the same belongs to a HUF or not. Illustration (g)
of Section 415 IPC clearly indicates that if at the very
initiation of the negotiations, it is evident that there was
no intention to cheat, the dispute would be of a civil G
 nature. But such a conclusion would depend on the
 evidence to be led at the time of trial. In the instant case,
 the complaint does not make out a prima facie case to 90
 to trial. The petitioner may have discharged his f1.1nctions-
 as a constituted attorney for the accused No.1 by acting -
 as a liaison between the accused No.1 and the father of H
    40      SUPREME COURT REPORTS               [2010] 7 S.C.R.


A the respondent, but that would not in itself indicate that
  he did not have any knowledge of the status of
  ownership of the land forming the subject matter of the
  transaction. Hence the order of High Court is not
  interfered with. [Para 13] [44-D-H; 45-A-E]
B
       Nageshwar Prasad Singh v. Narayan Singh (1998) 5
  sec 694, referred to.
                        Case Law Reference:

c        (1998) s sec 694        referred to          Para 8

        CRIMINAL APPELLATE JURISDICTION: SLP (Criminal)
    No. 1953 of 2008.

      From the Judgment & Order dated 19.02.2008 of the High
D Court of Delhi at New Delhi in CRLMC No. 847 of 2005.

         Aman Lekhi, Meenakshi Lekhi, Sachin Jain, Vishal and
    Sunil Kumar Verma for the Petitioner.

      Ashok Gurnani, S.K. Chaturvedi and K.V. Mohan for the
E Respndent.

         The Judgment of the Court was delivered by

        ALTAMAS KABIR, J. 1. In this Special Leave Petition,
  the Petitioner, S.P. Gupta, has challenged the order dated
F 19th February, 2008, passed by the learned Single Judge of
  the Delhi High Court in Crl.M.C. No.847 of 2005, dismissing
  the Petitioner's application under Section 482 Cr.P.C. for
  quashing of the Criminal Complaint No.932 of 1992,
  instituted against the Petitioner and the other co-accused by
G the Complainant (father of the Respondent) under Section
  420 read with Section 120-8 of the Indian Penal Code.

       2. By an order dated 7th April, 1992, the learned
  Metropolitan Magistrate, New Delhi, issued summons to the
H Petitioner, Accused No.1 Smt. Motian Devi Lamba and
          S.P. GUPTA v. ASHUTOSH GUPTA                      41
                [ALTAMAS KABIR, J.]
Accused No.4 Shri G.R. Singhal under Section 420 read with       A
Section 34 IPC. The Revision Petition filed against the said
order issuing summons having been dismissed by the
Additional Sessions Judge, New Delhi, on 8th February, 2005,
the Petitioner moved the Application under Section 482 Cr.P.C.
before the High Court.                                           B

      3. Having regard to the allegations in the complaint, the
learned Single Judge of the High Court dismissed the said
application upon holding that upon reading the complaint, it was
not possible to conclude that not even a prima facie case had C
been made out against the Petitioner for the offence under
Section 420 read with Section 34 IPC. The High Court took
note of the fact that having regard to the role attributed to each
of the accused which had been noticed by the learned
Magistrate, summons had been issued to only three of them
and that as far as the Petitioner was concerned, the narration D
in the complaint showed that he was integral to all the
transactions that had taken place between the complainant and
the Accused No.1 as he was the constituted attorney of the said
 accused. The learned Single Judge also observed that whether
the Petitioner had acted with dishonest intentions or as to E
whether he was unaware of the dishonest intentions of the
Accused No.1 or that he himself held out no assurance as to
 the title of the Accused No.1 at the time the agreement for sale
was executed or whether he acted beyond the scope of his
 authority under the power of attorney, were matters that raised F
 triable issues and could only be determined by leading
 evidence at the trial.

      4. Mr. Aman Lekhi, learned Senior Advocate appearing
in support of the Special Leave Petition, urged that all the three G
Courts below had completely misconstrued the material
available for the purpose of taking cognizance on the complaint
filed by Chat Ram Gupta, the father of the Respondent Ashutosh
Gupta. Mr. Lekhi urged that as the holder of the Power of
Attorney for the Accused No.1, the Petitioner had merely H
    42       SUPREME COURT REPORTS                   [2010] 7 S.C.R.


A   carried out the instructions given to him from time to time by
    the Accused No.1 which he was required to follow in keeping
    with the powers vested in him under the Power of Attorney. Mr.
    lekhi urged that the Petitioner was merely an agent appointed
    to carry out certain directions and that he had no personal
B   knowledge of the status of the properties involved in the
    transaction.

         5. Mr. Lekhi submitted that if the Petitioner had no
    dishonest intention to defraud or cheat the father of the
    Respondent, he would not have handed over possession of the
C   property in question to the father of the Respondent. In fact, the
    Petitioner received the consideration amount on behalf of
    Accused No.1 and made over the same to her while making
    over possession of the land to the complainant.

D        6. Mr. Lekhi submitted that the Petitioner was unaware of
    the manner in which the property had been acquired by the
    Accused No.1 or that the same belonged to a Hindu Undivided
    Family (HUF) and had no dishonest intention to either defraud
    or cheat the father of the Respondent and accordingly, at best
E   a suit of a civil nature could have been filed on account of the
    transaction and the issuance of summons on the complaint filed
    by the complainant (father of the Respondent) was not justified
    in the facts of the case.

       7. Mr. Lekhi submitted that the facts, as disclosed, do not
F bring the actions of the Petitioner within the ambit of the
  expression "misrepresentation" as defined in Section 18 of the
  Indian Contract Act, 1872, since neither did he has any intention
  to deceive the father of the Respondent, nor did he gain any
  advantage in acting as the agent of the Accused No.1 for the
G sole purpose of receiving the consideration money and making
  over possession of the land to the father of the Respondent, it
  could not be said that he had committed any offence, as
  alleged, and the summons issued on the said complaint under
  Section 482 read with Section 34 IPC were liable to be
H quashed.
          S.P. GUPTA v. ASHUTOSH GUPTA                        43
                [ALTAMAS KABIR, J.]
     8. In support of his submissions, Mr. Lekhi referred to a A
Three-Judge Bench decision of this Court in Nageshwar Prasad
Singh vs Narayan Singh [(1998) 5 SCC 694], in which a
similar question fell for consideration and relying on Illustration
(g) of Section 415 of the Indian Penal Code, it was held that
an agreement for sale of land and the earnest money paid to B
the owner as part consideration and possession of the land
having been transferred to the purchasers/complainants and the
subsequent unwillingness of the owner to complete the same,
gave rise to a liability of a civil nature and the criminal complaint
was, therefore, not competent.                                       c
     9. Mr. Lekhi submitted that in the facts of the present case,
which are almost identical to the facts of the aforesaid case,
the summons issued to the Petitioner was liable to be quashed.

     10. Opposing Mr. Lekhi's submissions, Mr. Ashok Gurnani, D
Advocate for the Respondent, contended that as had been
indicated by the High Court, the question as to whether the
Petitioner had any dishonest and/or fraudulent intention or
whether he had deliberately misrepresented the facts relating
to the status of ownership of the land would become clear once E
evidence had been led in regard to the circumstances in which
he had represented to the father of the Respondent that the land
was free from all encumbrances and that the Accused No.1 was
the sole owner of the property. Mr. Gurnani submitted that had
the Petitioner not made such a representation to the father of F
the Respondent, he may not have proceeded with the
transaction. It was urged that it was too early for an assumption
to be drawn that the Petitioner had no dishonest intention in
representing to the father of the Respondent that the property
was free from all encumbrances and that the Accused No.1 was G
the sole owner of the property.

     11. Referring to the submissions made by Mr. Lekhi on
Section 18 of the Indian Contract Act, 1872, Mr. Gurnani urged
that Sub-Section (1) of Section 18 was quite clear as to what
constituted misrepresentation.                                       H
    44       SUPREME COURT REPORTS                   [2010] 7 S.C.R.


A        12. As far as the decision in Nageshwar Prasad Singh's
    case (supra) was concerned, Mr. Gurnani submitted that the
    facts of the $aid case and the present case, though similar,
    could be distinguished having particular regard to Illustration (g)
    of Section 415 IPC. It was submitted that if ·no dishonest
B   intention could be shown at the very initial stage when the
    agreement was arrived at, the Court would be justified in
    holding that there was no misrepresentation and the dispute
    involving the refusal of one party to complete the transaction
    would be a dispute of a civil nature, which was not so in the
c   instant case. Mr. Gurnani urged that the order of the High Court
    or that of the other fora below did not warrant any interference
    and the Special Leave Petition was liable to be dismissed.

        13. Having carefully considered the submissions made on
  behalf of the respective parties and the complaint filed by the
D father of the Respondent, we are inclined to agree with the
  views expressed by the High Court that a prima facie case had
  been made out to go to trial. There is a positive assertion in
  the complaint that an assurance had been given by the
  Petitioner to the complainant that the property in question was
E free from all encumbrances and that the Accused No.1 was the
  sole owner of the property. It has been mentioned in the
  complaint that had not such a representation been made
  relating to the status of ownership of the property in question,
  the complainant may not have entered into the transaction at
F all. Whether or not the Petitioner was truly mistaken with regard
  to the information given by him is a question of utmost
  importance in answering a charge of the nature indicated in the
  complaint. Merely because the Petitioner had received part
  payment of the consideration amount and had made over the
G same to the Accused No.1 and merely because possession
  of the land had been handed over by him to the complainant,
  cannot form the basis of a presumption that he had no
  knowledge that there was a dispute regarding the ownership
  of the property, as to whether the same belongs to a HUF or
H not. It is true, as pointed out by Mr. Lekhi, that Section 415 IPC,
           S.P. GUPTA v. -ASHUTOSH GUPTA                        45
                 [ALTAMAS KABIR, J.]

which defines the offence of cheating, provides in Illustration (g)    A
as follows:

     "(g). A intentionally deceives Z into a belief that A means
     to deliver to Z a certain quantity of indigo plant which he
     does not intend to deliver, and thereby dishonestly induces
                                                                       8
     Z to advance money upon the faith of such delivery, A
     cheats; but if A, at the time of obtaining the money, intends
     to deliver the indigo plant, and afterwards breaks his
     contract and does not deliver it, he does not cheat, but is
     liable only to a civil action for breach of contract."
                                                                       c
     However, the aforesaid provision clearly indicates that if
at the very initiation of the negotiations it was eyident that there
was no intention to cheat, the dispute would be of a civil nature.
But such a conclusion would depend on the evidence to be led
at the time of trial. In the instant case, the complaint does not      D
make out a prima facie case to go to trial. The Petitioner may
have discharged his functions as a constituted attorney for the
Accused No.1 by acting as a liaison between the Accused
No.1 and the father of the Respondent, but that does not in itself
indicate that he did not have any knowledge of the status of           E
ownership of the land forming the subject matter of the
transaction.

     14. We are not, therefore, inclined to interfere with the order
of the High Court impugned in the Special Leave Petition and
the same is, accordingly, dismissed.
                                                                       F

D.G.                         Special Leave Petition dismissed.