INDER MOHAN GOSWAMI AND ANR. v. STATE OF UTTARANCHAL AND ORS

Citation: [2007] 10 S.C.R. 847

Court: Supreme Court of India

Bench: K.G. BALAKRISHNAN, R.V. RAVEENDRAN, DALVEER BHANDARI

Case summary

INDER MOHAN GOSWAMI AND ANR. v. STATE OF UTTARANCHAL AND ORS.pdf

Judgment text

y INDER MOHAN GOSWAMI AND ANR. v. STATE OF UTTARANCHAL AND ORS. OCTOBER 9, 2007 [K. G. BALAKRISHNAN, CJ. R. V. RAVEENDRAN AND DALVEER BHANDARI, JJ. ) Code ofCriminal Procedure, 1973: s.

482-lnherent powers ofHigh Court-Scope and ambit of- Dispute ofcivil nature between parties emanatingfrom cancellation ofGeneral Power ofAttorney and termination ofagreement to sell- Civil suit pending in court-On complaint, an FIR registered and criminalproceedings initiated-Non-bailable warrants issued-High Court declining to quash criminalproceedings-HELD: Dispute being purely ofcivil nature and civil suit ofcomplainants pending in court ofcompetent jurisdiction, initiation ofcriminal proceedings by them is clearly an abuse ofprocess ofCourt-Judicial Magistrate, without properly comprehending the nature of controversy involved and without exhausting the available remedies issued non-bailable warrants disregarding the settled legalposition-Ifany abuse ofprocess leading to injustice is brought to notice ofCourt, then Court would be justified in preventing injustice by invoking inherent powers in absence ofspecific provision in Statute-Judgment ofHigh Court in declining to exercise its inherent power has led to grave miscarriage ofjustice-Allproceeding emanating.

from FIR shall stand quashed- Administration ofcriminaljustice-Inherentpowers ofCourt-Penal Code, 1860-ss. 4201467. Code ofCriminal Procedure, 1973: s. 70-Warrant ofarrest-Non-bailable warrants-Issuance of- HELD: Issuance ofnon-bailable warrants involves interference with personal liberty-Therefore, Courts have to be extremely careful in issuing non-bailable warrants-Guidelines with regard to issuance of .. ,. non-bailable warrants reiterated-Constitution ofIndia-Article 21- Practice and Procedure. A contract for construction of a bathing ghat on the bank of river Ganga was entered into between Sanatan Dharma Pratinidhi Sabha and the contractor-respondent no. 3. On completion ofthe contract, the ~resident of the Sabha executed a General Power of Attorney in favour ofthe contractor in respect of 13. 5 bighas out of 26 bighas ofits land bearing khasra no. 140, in consideration ofthe construction work carried out by respondent no. 3.

The parties executed a further agreement to sell the remaining 11. 19 bighas of land ofkhasra no. 140 to respondent no. 3, who paid earnest money to the Sabha. According to the agreement, the balance amount was to be paid by 31. 3. 1997 and time was essence of the contract. On the death ofthe President ofthe Sabha, at the request ofrespondent no. 3, a fresh General Power ofAttorney in respect ofthe said 13. 5 bighas ofland was executed in favour of his son-respondent no. 4. It was the case ofthe Sabha that it came to know that respondents no. 3 and 4, by misrepresentation and mism;ing the General Power ofAttorney, were attempting to sell the entire 26 bighas ofland of khasra no. 140 as they executed 29 registered sale deeds in respect of13. 5 bighas ofland and respondent no. 4 sold the remaining 11. 19 bighas ofland to his father, respondent no. 3, by e:x. ecuting three sale deeds. Thereupon the General Secretary ofthe Sabha, appellant no. 1, after sending a notice dated 30. 4.

2001 to respondents no. 3 and 4 cancelled the General Power of Attorney. In order to protect the interests ofthe Sabha, appellant no. 1 sold the remaining 11. 19 bighas ofland ofkhasra no. 140 to a third person on 18. 12. 2002. Upon this, respondent no. 3 filed complaints u/ss. 420, 467 ~nd 120;. B IPC, and ultimately an FIR was registered. Meanwhile he also filed a civil suit in the court ofCivil Judge (Sr. Division) for cancellation ofthe sale deed executed by the Sabha. In the criminal proceedings the Judicial Magistrate issued nonbailable warrants against the appellants and others, who approached the High Court under s. 482 Cr. PC for quashing the criminal proceedings against them. The High Court dismissed the petition.

y It was contended for the appellants that the controversy between the parties was purely ofa civil nature since the entire issue related to ascertaining the right and title with regard to the land in dispute in respect ofwhich a suit was pending before a competent civil court, and, in the circumstances, the High Court gravely erred in dismissing the application u/s 482 Cr. PC. Disposing ofthe appeal, the Court HELD: 1. 1. The court must ensure that criminal prosecution is not used as an instrument of harassment or for seeking private vendetta orwith an ulterior motive to pressurize the accused. In the instant case, the issues relating to right and title with regard to the land in dispute as also the issue ofcorrect demarcation ofland in Khasra No. 140 are pending adjudication in a competent civil court.

The appellants who are office-bearers ofa charitable organization, namely, Sanatan Dharma Pratinidhi Sabha, in order to protect the interests ofthe Sabha, cancelled the Power ofAttorney by executing a registered deed ofcancellation after giving notice to the Power of Attorney holders. The appellants sold only that part ofthe land on behalf of the Sabha for which an agreement to sell with the complainants-respondents had already been terminated. The respondents' earnest money had been forfeited. All this was done only after appellants had given the respondents due notice. The veracity ofthe facts alleged by the appellants and the respondents can only be ascertained on the basis ofevidence and documents by a civil court of competent jurisdiction. The dispute in question is purely ofcivil nature and respondent no. 3 has already instituted a civil suit in the court ofCivil Judge.

In the facts and circumstances of the case, initiating criminal proceedings by the respondents against the appellants is clearly an abuse of the process ofcourt. [Paras 14, 21, 22 and 45] [857-E; 859-F, G, H; 860-A, B; 868-E) 1. 2. The authority of Court exists for the advancement of justice. It is true that inherent powers under section 482 Cr. P. C. , though wide, have to be exercised sparingly, carefully and with great caution and only when such exercise is justified by the tests specifically laid down in the section itselfand in the decisions ofthis Court. But, ifany abuse ofthe process leading to injustice is brought y to the notice of the court, then the Court would be justified in preventing injustice by invoking inherent powers in absence of specific provisions in the Statute. [Para 24] (860-E, F] State ofHaryana & Ors. v. Bhajan Lal & Ors. , (1990] 3 SCR 259=(1992] Supp. 1 SCC 335, followed. R. P. Kapur v.

State ofPunjab, (1960) 3 SCR 388=AIR (1960) SC 866; State ofKarnataka v. L. Muniswamy & Ors. , (1977] 3 SCR 113=(1977] 2 SCC 699; Chandrapal Singh & Ors. v. Maharaj Singh & Anr. , (1982] 1 SCC 466; Madhavrao Jiwajirao Scindia & Ors. v. Sambhajirao ChandrojiraoAngre & Ors. , (1988] 1SCC692; Roy VD. v. State ofKera/a, [2000) 4 Supp. SCR 539=(2000] 8 SCC 590; Zandu Pharmaceutical Works Ltd. & Ors. v. Mohd. Sharaful Haque & Anr. , (2004] 5 Supp. SCR 790=(2005] 1 SCC 122 and Indian Oil Corporation v. NEPC India Ltd. & Ors. , (2006) 3 Supp. SCR 704=(2006) 6 sec 736, relied on. JanataDalv. H S. Chowdhary& Ors. , (1992) 1 Supp. SCR226= (1992] 4 SCC 305 and G. Sagar Suri & Anr. v. State ofUP & Ors. , (2000] 1 SCR 417, [2000) 2 SCC 636, referred to. Connellyv. DPP, (1964) AC 1254 and DPPv. Humphrys[1911] AC 1, referred to. 2. 1.

In order to determine the question whether it is a case where the allegations made in the first information report or the complaint, even if they are taken at their face value and accepted in entirety, do not make out a case against the accused under Sections 420, 467 and 120B IPC, it becomes relevant to note the nature of the offences alleged, the ingredients of the offences and the averments made in the FIR/complaint. [Para 38) [866-B, CJ 2. 2. In the instant case,_ the first information report has been registered under sections 420/467/120B IPC and the allegations · leveled therein are of(1) cheating and (2) forgery. To hold a person guilty ofcheating it is necessary to show that he had a fraudulent or dishonest intention at the time ofmaking the promise. From his mere y failure to subsequently keep a promise, one cannot presume that he all along had a culpable intention to break the promise from the beginning. As regards s.

467 IPC, the basic ingredients of offence are altogether missing even in the allegations ofthe FIR against the appellants. Therefore, by no stretch ofimagination, the appellants can be legally prosecuted for an offence under Section 467 IPC. Even if all the averments made in the FIR are taken to be correct, the case for prosecution under Sections 420 and 467 IPC is not made y" out against the appellants. Therefore, to prevent abuse ofthe process and to secure the ends of justice, it becomes imperative to quash the FIR and any further proceedings emanating therefrom. [Paras 39, 41, 43 and 44) (866-C, D; 867-D, E; 868-C, DJ State ofHaryana & Ors. v. Bhajan Lal & Ors. , (1990] 3 SCR 259=(1992) Supp. 1SCC335, followed. 3. 1. It has come to the notice of this Court that in many cases ~ bailable and non-bailable warrants are issued casually and -i mechanically.

In the instant case, the court without properly comprehending the nature of controversy involved and without exhausting the available remedies issued non-bailable warrants. The trial court disregarded the settled legal position clearly enumerated in the decisions ofthis Court. [Para 46) [868-G; 869-A] Omwati v. State ofUP & Anr. , [2004] 4 SCC 425 and State of ,.. UP. v. Poosu &Anr. , [1976) 3SCR1005, [1976] 3SCC1, relied on. \ 3. 2. The issuance ofnon-bailable warrants involves interference with personal liberty. The Court should try to maintain proper balance between individual liberty and the interest ofthe public and the State while issuing non-bailable warrants. Therefore, the courts have to be extremely careful before issuing non-bailable warrants. There cannot be any straight-jacket formula for issuance ofwarrants ...

-but as a general rule, unless an accused is charged with the commission ofan offence ofa heinous crime and it is feared that he is likely to tamper or destroy the evidence or is likely to evaJe the process oflaw, issuance ofnon-bailable warrants should be avoided. Non-bailable warrants should be issued to bring a person to court when summons ofbailable warrants would be unlikely to have the desired result. This could be when: it is reasonable to believe that the person will not voluntarily appear in court; or the police authorities are unable to find the person to serve him with a summon; or it is considered that the person could harm someone ifnot placed into custody immediately. As far as possible, if the court is of the opinion that summons will suffice in getting the appearance ofthe accused in the court, the summons or the bailable warrants should be preferred.

The warrants either bailable or non-bailable, have extremely serious consequences and ramifications that ensue on its issuance, and, therefore, the same should never be issued without proper scrutiny offacts and complete application ofmind. The court must very carefully examine whether the criminal complaint or FIR has not been filed with an oblique motive. [Para 50, 51, 52, 53, 55, 56 and 57] (870-A, C-G; 871-B-D] "The American Declaration ofIndependence 1776"; "French Declaration ofthe Rights ofMen and the Citizen 1789"; and "Universal Declaration ofHuman Rights and the International Covenant ofCivil and Political Rights 1966", referred to. 3. 3. In complaint cases, at the first instance, the court should direct serving ofsummons along with a copy ofthe complaint. Ifthe accused seems to be avoiding the summons, the court, in the second . ·- Rs. 1,00,000/- on 21. 3. 1997. On the request of respondent no. 3, the ~ Sabha reduced the amount owed ofRs.

1,50,000/- to him in view of the existence of a passage on the said land. Out of the balance of Rs. 8,60,650/-, a further concession of Rs. 60,650/- was given to Respondent no. 3. He thus had to pay the balance amount ofRs. 8,00,000/ -. The said measurement sheet was endorsed by respondent nos. 3 and 4 and the representatives of the Sabha on 19. 3. 2000. 8. The General Power of Attorney executed by Late Mohan Lal ;>\ Sharma, President ofthe Sabha, had ceased to be in effect after his death. Therefore-, the need ofa fresh power ofattorney was felt and respondent no. 3 desired that the fresh Power of Attorney be executed in the name ofhis son, Suresh Ahuja (respondent no. 4 herein) for the very same 13. 5 Bighas of land in regard to which earlier Power of Attorney dated 13. 12. 1996 had been given. Accordingly, General Secretary ofthe Sabha, appellant no. I herein, executed a fresh General Power of Attorney on r- 15. l. 2000 in respect of 13. 5 Bighas ofland situated in part ofOld .

Khasra No. 140 (new Khasra Nos. 61, 62, 63, 64, 65, 66, 67, 68 and part of 89, 90) in Village Haripur Kalan, Rishikesh, Dehradun, in favour ofSuresh Ahuja (respondent no. 4) as per the request ofrespondent no. 3. '\-' 9. According to the appellants, the Sabha made several requests to ~,,.... , respondent nos. 3 and 4 asking them to pay the balance amount of Rs. 8,00,000/-. However, despite repeated requests, the respondents failed to do so. 10. The appellants submitted that the Sabha had learnt from reliable sources and from the office ofthe Registrar ofProperties that respondent no. 3, by misrepresentation and by misusing his General Power ofAttorney for the 13. 5 Bighas ofland, was attempting to sell the entire 26 Bighas of the Sabha's land tc other parties and was executing sale deeds without "( any right whatsoever in respect of the remaining 11. 19 Bighas. ' The appellants learnt that respondent no. 4 had executed at least 29 registered sale deeds consisting of 13.

5 Bighas ofland in favour ofvarious parties. The Sabha also djscovered that 11. 19 Bighas of land, for which there was only an agreement to sell between respondent no. 3 and the Sabha, was also sold by respondent no. 4 to his father (respondent no. 3 herein) by e)):ecuting three registered sale deeds. Such sales could not give any title to respondent no. 3. ~ )- 11. On 30. 4. 2001, appellant no. 1 sent a legal notice (second notice) to respondent nos. 3 and 4 informing them that ifthe balance amount of Rs. 8,00,000/- was not paid, he would have to cancel the General Power ofAttorney. No reply to the said notice was received from the respondents nor was Rs. 8,00,000/- paid. In these circumstances, appellant no. 1 (I. M. Goswami) cancelled the power of attorney issued in favour of respondent no. 4 and informed respondent no. 4 accordingly. A public -- no. 3 filed a civil suit in the court ofCivil Judge (Senior Division) against -; the Sabha bearing Original Suit No.

302of2003 titled Himmat Rai Ahuja v. Sanatan Dharam Pratinidhi Sabha. In this suit, respondent no. 3 prayed for cancellation of sale deed executed by the Sabha in favour of Sunil Kumar and for permanent injunction against the appellants herein restraining them from interfering in his alleged property. Thus, the issues relating to ascertaining the right, title ofthe land in dispute and also the issue of correct demarcation of land in K. hasra No. 140 are pending adjudication in a competent civil court. '? \ 15. On the basis ofthe FIR registered, the case was investigated by the Sub-Inspector, Raiwala Police Station. Later on the investigation was transferred to Rishikesh Police Station. Thereafter, the investigation was again transferred to Raiwala Police Station and a charge-sheet was filed in the Court ofthe Special Judicial Magistrate, Rishikesh. . r 16.

Aggrieved by the filing ofthe false and incorrect charge-sheet in the court of Special Judicial Magistrate, Rishikesh in Criminal Case G No. 1728 of 2003 titled State v. Inder Mohan Goswami & Ors. , the appellants filed a Criminal Miscellaneous Application No. 248 of2003 in the High Court of Uttaranchal at Nainital under section 482 Cr. P. C. for quashing the proceedings against them. The High Court was pleased to pass the interim order on 22. 10. 2003 staying further proceedings. A reply was filed on behalfof the State by Shri Dinesh Kumar Sharma, SHO, Raiwala Police Station, in which two points were raised: 1. That, appellant no. l has wrongly cancelled the General Power of Attorney given to respondent no. 4; and 2. That, appellant no. 1 has wrongly and illegally executed the sale deed of land comprising in Khasra No. 140 (new Khasra Nos. 61 to 68, 89 and 90) without returning the earnest money of respondent nos. 3 and 4. 17. The High Court by order dated 16. 7.

2004 dismissed the petition under Section 482 Cr. P. C. filed by the appellants on the ground that the records show that the allegations in the FIR constitute an offence as alleged by the complainant. The said order is challenged in this appeal by special leave. [) -~ 18. The appellants submitted that first appellant cancelled the power rofattorney by a registered cancellation deed after informing respondent no. 4. The cancellation was necessary to protect its interests because respondent no. 4 was selling the Sabha's land by misusing the power of attorney. The Sabha sold the land to Sunil Kumar only after respondent nos. 3 and 4 failed to fulfill their obligations under the contract and had malafide intention to grab the land without paying the balance amount. Accordingly, the sale deeds executed by respondent no. 4 in favour of -~ respondent no. 3 were illegal.

The appellants' cancelling the power of I attorney and selling a part of the land to Sunil Kumar to protect the interests ofthe Sabha by no stretch ofthe imagination attracts ingredients of the offences of sections 467, 420 and l20B IPC. According to the appellants, the entire issue relates to ascertaining the right, title ofthe land in dispute and also the issue of correct demarcation of the land Khasra No. 140, all of which are pending adjudication before a competent civil ~ court. The appellants contended that they filed a criminal miscellaneous application under section 482 Cr. P. C. for quashing the FIR because no offence under sections 467, 420 and 120B of the I. P. C. could be made out. The controversy between the parties is purely of a civil nature. A civil suit has already been filed and is pending adjudication. The appellants [DALVEERBHANDARl,J. ] submitted that the High Court gravely erred in dismissing the application under section 482 Cr. P.

C; whereas, according to the respondents, the High Court was justified in declining to quash the FIR because of the conduct ofthe appellants. In the counter-affidavit, it was also alleged that the loss had not been suffered by the appellants but in fact it had been suffered by the respondents. 19. The appellants in the rejoinder submitted that the trial court was not justified in taking cognizance ofthe matter when no prima facie case was made out against the appellants. The trial court gravely erred in not appreciating the complete facts ofthe case_in the proper perspective. The trial court has not properly comprehended the complete investigation reports, which were conducted by two different investigating officers. It was pointed out that it was the respondents who had committed criminal breach by purporting to sell that part ofthe land for which an agreement to sell was procured, by misusing the Power ofAttorney given to them for some other part of the land. Respondent no.

4 was clearly guilty of offences under sections 420 and 467 IPC and the appellants had also filed a criminal complaint against respondent nos. 3 and 4 before the Special Judicial Magistrate, Rishikesh under sections 1208/467/468/471 IPC. The criminal case was registered as Case No. 1306of2003 titled as JM Goswami v. Suresh Ahuja. The Special Judicial Magistrate vide order dated 12th May, 2005 had issued summons to respondent nos. 3 and4. 20. The appellants submitted that in the impugnedjudgment, the High Court had also disregarded the settled legal position crystallized by various judgments ofthis court and declined to quash the criminal proceedings against the appellants. 21. We have heard the learned counsel for the parties at length.

The appellants who are office-bearers ofa charitable organization, namely, r Sanatan Dharrna Pratinidhi Sabha, in order to protect the interests ofthe Sabha cancelled the Power of Attorney by executing a registered Cancellation Deed after giving notice to the Power of Attorney holders. The appellants sold only that part of the land to Sunil Kumar on behalf of the Sabha for which an agreement to sell with the complainants (respondents) had already been terminated. The respondent's earnest H money had been forfeited. All ofthis was only done after appellants had given respondents due notice. 22. The veracity of the facts alleged by the appellants and the respondents can only be ascertained on the basis of evidence and documents by a civil court of competent jurisdiction. The dispute in question is purely ofcivil nature and respondent no. 3 has already instituted a civil suit in the court ofCivil Judge.

In the facts and circumstances of this case, initiating criminal proceedings by the respondents against the appellants is clearly an abuse of the process ofthe court. Scope and ambit ofcourts' powers under section 482 Cr. P. C. 23. This court in a number of cases has laid down the scope and ambit ofcourts' powers under section 482 Cr. P. C. Every High Court has inherent power to act ex debito justitiae to do real and substantial justice, for the administration ofwhich alone it exists, or to prevent abuse ofthe I) process of the court. Inherent power under section 482 Cr. P. C. can be r. exercised: (i) to give effect to an order under the Code; (ii) to prevent abuse ofthe process of court, and (iii) to otherwise secure the ends ofjustice. 24. Inl1erent powers under section 482 Cr. P. C. though wide have to be exercised sparingly, carefully and with great caution and only when such exercise is justified by the tests specifically laid down in this section itself.

Authority ofthe court exists for the advancement ofjustice. Ifany abuse of the process leading to injustice is brought to the notice ofthe court, then the Court would be justified in preventing injustice by invoking inherent powers in absence of specific provisions in the Statute. Discussion ofdecided cases 25. Reference to the following cases would reveal that the courts have consistently taken the view that they must use this extraordinary power to prevent injustice and secure the ends ofjustice. The English courts have also used inherent power to achieve the same objective. It is generally agreed that the Crown Court has inherent power to protect its process from abuse. In Connelly v. DPP (1964) AC 1254, Lord Devlin stated that where particular criminal proceedings constitute an abuse of process, the court is empowered to refuse to allow the indictment to proceed to trial. Lord Salmon in DPP v.

Humphrys, (1977) AC 1 stressed the importance ofthe inherent power when he observed that it is only ifthe prosecution amounts to an abuse ofthe process ofthe court and is oppressive and vexatious that the judge has the power to intervene. He further mentioned that the court's power to prevent such abuse is of great constitutional importance and should be jealously preserved. 26. In R. P. Kapur v.

State ofPunjab, AIR (1960) SC 866, this court summarized some categories ofcases where inherent power can and should be exercised to quash the proceedings: (i) where it manifestly appears that there is a legal bar against the institution or continuance ofthe proceedings; (ii) where the allegations in the first information report or complaint taken attheir face value and accepted in their entirety do not constitute the offence alleged; (iii) where the allegations constitute an offence, but there is no legal evidence adduced or the evidence adduced clearly or manifestly fails to prove the charge. 27. The powers possessed by the High Court under section 482 of the Code are very wide and the very plenitude of the power requires great caution in its exercise. The court must be careful to see that its decision in exercise of this power is based on sound principles. The inherent power should not be exercised to stifle a legitimate prosecution.

The High Court should normally refrain from giving aprima facie decision in a case where all the facts are incomplete and hazy; more so, when the evidence has not been collected and produced before the court and the issues involved, whether factual or legal, are ofsuch magnitude that they cannot be seen in their true perspective without sufficient material. Of course, no hard and fast rule can be laid down in regard to cases in which the High Court will exercise its extraordinary jurisdiction ofquashing the proceedings at any stage. 28. This court in State ofKarnataka, v. L. Muniswamy & Ors. , [1977] 2 sec 699 observed that the wholesome power under section 482 Cr. P. C. entitles the High Court to quash a proceeding when it comes to the conclusion that allowing the proceeding to continue would be an abuse ofthe process ofthe court or that the ends ofjustice require that the proceeding ought to be quashed.

The High Courts have been invested 'y, with inherent powers, both in civil and criminal matters, to achieve a salutary public purpose. A court proceeding ought not to be permitted to degenerate into a weapon of harassment or persecution. The court observed in this case that ends ofjustice are higher than the end"! ofmere law though justice must be administered according to laws made by the legislature. This case has been followed in a large number ofsubsequent cases of this court and other courts. 29. In Chandrapal Singh & Ors. v. Maharaj Singh & Anr. , [1982] 1 sec 466, in a landlord and tenant matter where criminal proceedings had been initiated, this Court observed in para 1 at page 467 as under:- "A frustrated landlord after having met his waterloo in the hierarchy of civil courts, has further enmeshed the tenant in a frivolous criminal prosecution which prima facie appears to be an abuse ofthe process oflaw.

The facts when stated are so telling that the further discussion may appear to be superfluous. " 30. The court noticed that the tendency ofperjury is very much on the increase. Unless the courts come down heavily upon such persons, the wholejudicial process would come to ridicule. The court also observed that chagrined and :fiustrated litigants should not be pennitted to give vent to their :fiustration by cheaply invoking jurisdiction ofthe criminal court. 31. This court in Madhavrao Jilrnjirao Scindia & Ors. v. Sambhajirao Chandrojirao Angre & Ors. , [1988] 1 SCC 692 observed in para 7 as under: "7. The legal position is well settled that when a prosecution at the initial stage is asked to be quashed, the test to be applied by the court is as to whether the uncontroverted allegations as made 1 prima facie establish the offence.

It is also for the court to take into consideration any special features which appear in a particular case to consider whether it is expedient and in the interest ofjustice to permit a prosecution to continue. This is so on the basis that the court cannot be utilized for any oblique purpose and where in the opinion ofthe court chances ofan ultimate conviction is bleak and, therefore, no useful purpose is likely to be served by allowing a criminal prosecution to continue, the court may while taking into consideration the special facts ofa case also quash the proceeding even though it may be at a preliminary stage. " · 32. In State ofHaryana & Ors. v. Bhajan Lal & Ors. , [1992] Supp. 1SCC 335, this court in the backdrop ofinterpretation ofvarious relevant provisions ofthe Cr. P. C.

under Chapter XIV and ofthe principles of law enunciated by this court in a series of decisions relating to the exercise ofthe extraordinary power under Article 226 ofthe Constitution oflndia or the inherent powers under section 482 Cr. P. C. gave the following categories ofcases by way ofillustration wherein such power could be exercised either to prevent abuse ofthe process ofthe court or otherwise to secure the ends ofjustice. Thus, this court made it clear that it may not be possible to lay down any precise, clearly defined and sufficiently channelised and inflexible guidelines or rigid formulae and to give an exhaustive list to myriad kinds ofcases wherein such power should be exercised: )I, { \ "(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 tl1eir 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 6 under Section 156(1) of the Code except under an order of 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 ofthe 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 ofa Magistrate as contemplated under Section 155(2) ofthe Code.

(5) Where the allegations made in the FIR or complaint are so absurd and inherently improbable on the basis ofwhich no prudent person can ever reach ajust 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 ofthe proceedings and/or where there is a specific provision in the Code or the concerned Act, providing efficacious redress for the grievance ofthe aggrieved party. (7) Where a criminal proceeding is manifestly attended with ma/a 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. 33. This court in Janata Dal v. H S. Chowdhary & Ors. , (1992] 4 sec 305 observed thus: /~ "132.

The criminal courts are clothed with inherent power to make such orders as may be necessary for the ends ofjustice. Such power though unrestricted and undefined should not be capriciously or arbitrarily exercised, but should be exercised in appropriate cases, ex debito justitiae to do real and substantial justice for the administration of which alone the courts exist. The powers possessed by the High Court under section 482 of the Code are very wide and the very plentitude of the power requires great caution in its exercise. Courts must be careful to see that its decision in exercise ofthis power is based on sound principles. " 34. In G. Sagar Suri & Anr. v. State of UP & Ors. , (2000] 2 sec 636, this court observed that it is the duty and obligation ofthe criminal court to exercise a great deal ofcaution in issuing the process particularly when matters are essentially ofcivil nature. 35. This court in Roy VD. v. State ofKera/a, [2000] 8 SCC 590 observed thus:- "18.

It is well settled that the power under section 482 Cr. P. C has to be exercised by the High Court, inter alia, to prevent abuse '~ of the process of any court or otherwise to secure the ends of justice. Where criminal proceedings are initiated based on illicit material collected on s~ch and arrest which are per se illegal and vitiate not only a conviction and sentence based on such material but also the trial itself, the proceedings cannot be allowed to go on as it cannot but amount to abuse ofthe process ofthe court; in such a case not quashing the proceedings would perpetuate abuse ofthe process ofthe court resulting in great hardship and ~ .. , injustice to the accused. In our opinion, exercise of power under section 482 CrPC to quash proceedings in a case like the one on hand, would indeed secure the ends ofjustice. " 36. This court in Zandu Pharmaceutical Works Ltd. & Ors. v. Mohd. Sharaful Haque & Anr.

, [2005] 1 SCC 122 observed thus:- "It would be an abuse of process of'the court to allow any action which would result in injustice and prevent promotion of . ,. ' justice. In exercise ofthe powers, court would be justified to quash ' any proceeding ifit finds that initiation/continuance ofit amounts to abuse ofthe process ofcourt or quashing ofthese proceedings would otherwise serve the ends ofjustice. When no offence is disclosed by the complaint, the court may examine the question offact. When a complaint is sought to be quashed, it is permissible to look into the materials to assess what the complainant has r alleged and whether any offence is made out even ifthe allegations are accepted in toto. " 37. In Indian Oil Corporation v. NEPC India Ltd. & Ors. , [2006] 6 SCC 736, this court again cautioned about a growing tendency in business circles to convert purely civil disputes into criminal cases.

The court noticed the prevalent impression that civil law remedies are time consuming and do not adequately protect the interescs oflenders/creditors. The court further observed that "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. " 38. The question before us is - whether the case ofthe appellants comes under any ofthe categories enumerated in Bhajan Lal (supra)? y Is it case where the allegations made in the first information report or the complaint, even if they are taken at their face value and accepted in entirety, do not make out a case against the accused under Sections 420, 467 and 120B IPC? For determination ofthe question it becomes relevant to note the nature of the· offences alleged against the appellants, the ingredients ofthe offences and the averments made in the FIR/complaint. 39.

In the instant case, the first information report has been registered under sections 420/467/1208 IPC. The allegations leveled in the first information report are of(1) cheating and (2) forgery. Analysis ofrelevant provisions oflaw 40. Firstly, we shall deal with the section 420 IPC. Cheating is defined in section 415 IPC and is punishable under section 420 IPC. Section 415 is set out below: "415. Cheating-Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit ifhe were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body' mind, reputation or property, is said to 'cheat'. Explanation. -A dishonest concealment offacts is a deception within the meaning ofthis section. " [DALVEERBHANDARl,J.

] Section 415 IPC thus requires - 1. deception ofany person. 2. (a) fraudulently or dishonestly inducing that person- (i) to deliver any property to any person; or (ii) to consent that any person shall retain any property; or (b) _intentionally inducing that person to do or omit to do anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body mind, reputation or C property. 41. On a reading ofthe aforesaid section, it is manifest that in the definition there are two separate classes ofacts which the person deceived may be induced to do. In the first class of acts he may be induced fraudulently or dishonestly to deliver property to any person. The second class ofacts is the doing or omitting to do anything which the person deceived would not do or omit to do if he were not so deceived. In the first class ofcases, the inducing must be fraudulent or dishonest.

In the second class ofacts, the inducing must be intentional but need not be fraudulent or dishonest. Therefore, it is the intention which is the gist of E the offence. To hold a person guilty ofcheating it is necessary to show that he had a fraudulent or dishonest intention at the time ofmaking the promise. From his mere failure to subsequently keep a promise, one cannot presume that he all along had a culpable intention to break the promise from the beginning. 42. We shall now deal with the ingredients of section 467 IPC. Section 467 IPC reads as under: "467. Forgery ofvaluable security, will etc.

-Whoever forges a document which purports to be a valuable security or a will, or an authority to adopt a son, or which purports to give authority to any person to make or transfer any valuable security, or to receive the principal, interest or dividends thereon, or to receive or deliver any money, moveable property, or valuable security, or any document purporting to be an acquittance or receipt acknowledging 'r the payment ofmoney, or an acquittance or receipt for the delivery of~y moveable property or valuable security, shall be punished with imprisonment for life, or with imprisonment ofeitherdescription for a term which may extend to ten years, and shall also be liable to fine. " 43. The following ingredients are essential for commission ofthe offence under section 467 IPC: 1. the document in question so forged; 2. the accused who forged it. 3. the document is one of the kinds enumerated in the aforementioned section.

The basic ingredients ofoffence under Section 467 are altogether missing even in the allegations ofthe FIR against the appellants. Therefore, by no stretch ofthe imagination, the appellants can be legally prosecuted for an offence under Section 467 IPC. 44. Even ifall the averments made in the FIR are taken to be correct, ,... the case for prosecution under sections 420 and 467 IPC is not made out against the appellants. To prevent abuse ofthe process and to secure the ends ofjustice, it becomes imperative to quash the FIR and any further proceedings emanating therefrom. 45. The court must ensure that criminal prosecution is not used as an instrument of harassment or for seeking private vendetta or with an ulterior motive to pressure the accused. On analysis ofthe aforementioned ,/~ cases, we are ofthe opinion that it is neither possible nor desirable to lay down an inflexible rule that would govern the exercise of inherent jurisdiction.

Inherent jurisdiction ofthe High Courts under Section 482 Cr. P. C. though wide has to be exercised sparingly, carefully and with caution and only when it is justified by the tests specifically laid down in the Statute itselfand in the aforementioned cases. In view ofthe settled legal position, the impugned judgment cannot be sustained. 46. Before parting with this appeal, we would like to discuss an issue which is ofgreat public importance, i. e. , how and when warrants should [DALVEERBHANDARl,J. ] be issued by the Court? It has come to our notice that in many cases that A bailable and non-bailable warrants are issued casually and mechanically. In the instant case, the court without properly comprehending the nature ofcontroversy involved and without exhausting the available remedies issued non-bailable warrants. The trial court disregarded the settled legal. position clearly enumerated in the following two cases. 47. In Omwati v. State of UP & Anr.

, [2004] 4 SCC 425, this court dealt with a rather unusual matter wherein the High Court. firstly issued bailable warrants against the appellant and thereafter by issuing nonbailable warrants_put the complainant ofthe case behind bars without going through the facts ofthe case. This Court observed that the unfortunate sequel ofsuch unmindful orders has been that the appellant was taken into custody and had to remain in jail for a few days, but without any justification whatsoever. She suffered because facts ofthe case were not considered in proper perspective before passing the orders. The court also observed that some degree ofcare is supposed to be taken before issuing warrants. 48. In State ofUP. V. Poosu & Anr.

, [1976] 3 sec 1 at para 13 page 5, the Court observed: "Whether in the circumstances ofthe case, the attendance of the accused respondent can be best secured by issuing a bailable warrant or non-bailable warrant, is a matter which rests entirely in the discretion of the court. Although, the discretion is exercised judiciously, it is not possible to computerize and reduce into immutable formulae the diverse considerations on the basis ofwhich p this discretion is exercised. Broadly speaking, the court would take into account the various factors such as the nature and seriousness ofthe offence, the character ofthe evidence, circumstances peculiar to the accused, possibility ofhis absconding, larger interest ofthe r· public and the State. Personal liberty and the interest ofthe State 49. Civilized countries have recognized that liberty is tpe most precious of all the human rights. The American Declaration of Independence 1776, French Declaration of the Rights of Men and the .

A Citizen 1789, Universal Declaration ofBuman Rights and the International Covenant of Civil and Political Rights 1966 all speak with. one voice liberty is the natural and inalienable right ofevery human being. Similarly, . Article 21 ofour Constitution proclaims that no one shall be deprived of his liberty except in accordance with the procedure prescribed by law. 50. The issuance ofnon-bailable warrants involves interference with personal liberty. Arrest and imprisonment means deprivation ofthe most precious right ofan individual. Therefore, the courts have to be extremely ~ careful before issuing non-bailable warrants. 51. Just as liberty is precious for an individual so is the interest of the society in maintaining law and order. Both are extremely important for the survival ofa civilized society.

Sometimes in the larger interest of the Public and the State it becomes absolutely imperative to curtail freedom ofan individual for a certain period, only then the non-bailable warrants should be issued. When non-bailable warrants should be issued 52. Non-bailable warrant should be issued to bring a person to court when summons ofbailable warrants would be unlikely to have the desired result. This could be when: it is reasonable to believe that the person will not voluntarily * appear in court; or the police authorities are unable to find the person to serve * him with a summon; or it is considered that the person could harm someone if not * placed into custody immediately. 53. As far as possible, ifthe court is ofthe opinion that a summon will suffice in getting the appearance of the accused in the court, the summon or the bailable warrants should be preferred.

The warrants either bailable or non-bailable should never be issued without proper scrutiny offacts and complete application ofmind, due to the extremely serious consequences and ramifications which ensue on issuance ofwarrants. The court must very carefully examine whether the Criminal Complaint or FIR has not been filed with an oblique motive. 54. In complaint cases, at the first instance, the court should direct serving of the summons along with the copy of the complaint. Ifthe accused seem to be avoiding the summons, the court, in the second instance should issue bailable-warrant. In the third instance, when the court is fully satisfied that the accused is avoiding the court's proceeding intentionally, the process ofissuance ofthe non-bailable Warrant should be resorted to. Personal libe;ty is paran1ount, therefore, we caution courts at the first and second instance to refrain from issuing non-bailable warrants. 55.

The power being discretionary must be exercisedjudiciously with extreme care and caution. The court should properly balance both C personal liberty and societal interest before issuing warrants. There cannot be any straight-jacket formula for issuance of warrants but as a general rule, unless an accused is charged with the commission ofan offence of a heinous crime and it is feared that he is likely to tamper or destroy the evidence or is likely to evade the process oflaw, issuance ofnon-bailable warrants should be avoided. -'i 56. The Court should try to maintain proper balance between individual liberty and the interest ofthe public and the State while issuing non-bailable warrant. 57. On consideration of the totality offacts and circumstances of this case, the impugned judgment and order ofthe High Court cannot be sustained. 58.

Needless to mention that the concerned civil court (where the suit is pending) shall decide the suit without being influenced by any observation made by us in this judgment regarding the merits ofthe civil ~ 59. Reverting to the facts ofthis case, we are ofthe considered view that the impugnedjudgment ofthe High Court in declining to exercise its inherent power has led to grave miscarriage ofjustice. Consequently, we set aside the impugned judgment and in order to prevent abuse of the process of the court and to otherwise secure the ends of the justice we direct that all the proceedings emanating from the FIR shall stand quashed. The appeal is disposed ofaccordingly. In the facts and circumstances of this case, we direct the parties to bear their own costs. RP. Appeal disposed of.