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CASE NO.: Special Leave Petition (crl.)  3030 of 2006

PETITIONER: THELAPALLI RAGHAVAIAH

RESPONDENT: STATION HOUSE OFFICER & ORS

DATE OF JUDGMENT: 19/03/2007

BENCH: Dr.AR. Lakshmanan & Altamas Kabir

JUDGMENT: J U D G M E N T

ALTAMAS KABIR, J.

       On 21st June, 2005, the petitioner herein lodged a First  Information Report with the Kovur Police Station in Nellore  District against the private respondent Nos. 2, 3, 4 and 5  herein alleging commission of offences under Sections 196,  199, 120(B), 403, 406 and 418 Indian Penal Code.  The complaint in short is that Raghava Infrastructure  Private Ltd. was a Private Limited Company engaged in doing  civil contract works.   Soma Enterprise Limited is also doing  civil contract works having its corporate office at 14, Avenue-4,  Banjara Hills, Hyderabad.and its site office near Saibaba  Temple, Kovur, adjacent to National Highway-5.  It was stated  that the respondent No. 3 was one of its Directors.  The  Respondent Nos. 4 and 5 are the Project Manager and  Materials Engineer of the Company. It was alleged in the complaint that Soma Enterprise  Limited who obtained a contract for executing work on the  Nellore Bypass Road on National Highway-5, appointed the  complainant as its sub-contractor for excavation and  transportation of gravel for the formation of embankment of  Nellore Bypass Road on National Highway-5 from Km 172.840  to 178.200 from 1st June, 2002 onwards.   The agreed rate of  remuneration was Rs.27/- per cubic meter for the first  kilometer and Rs.4/- per cubic meter for each kilometer  thereafter. It was alleged that from the month of August, 2002 to  December, 2002 Soma Enterprise Limited started mixing fly  ash with the gravel purportedly in keeping with instructions  received.   On account of such mixing of fly ash with the  gravel, Soma Enterprise Ltd. began deducting various  amounts from the complainant’s bills. According to the  complainant, despite repeated protests, Soma Enterprise  Limited did not pay any heed and continued to mix fly ash  with the gravel supplied by the complainant and also  continued to deduct amounts from the complainant’s bill, in  order to cause unlawful loss to the complainant and unlawful  gain for itself. It is alleged that the Director of Soma Enterprise Ltd.  assured the complainant that he would disburse the amount  pertaining to the quantity of gravel by adopting the best  suitable method for arriving at the volumetric bifurcation of  gravel and fly ash from the mix.   According to the  complainant, he continued to execute the work entrusted to  him as per the aforesaid assurance.  

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It was alleged in the complaint that a sum of Rs.5.72  lakhs had been deducted from the bill for the month of  February, 2003 alone.  It was also the complainant’s case that  he had requested the Director and Project Manager to count  the number of tippers of gravel being supplied and dumped by  the complainant in the stock yard for payment purposes, but  the Director did not agree to such a method.   The further complaint is that although the complainant  continued to supply the gravel in terms of the sub-contract,  the Director changed his stand and asked the complainant to  prove that the formula by which they were deducting the  amount for fly ash was wrong.  On that basis the complainant  approached the Geo Marine Consultants Private Limited,  Indira Nagar, Chennai, and had the gravel and fly ash tested.   A report was prepared by the Managing Director, but the same  was not accepted by Soma Enterprise Ltd.   Consequently, the  complainant approached the IIT Madras and got the mixed  tested at the Department of Ocean Engineering, IIT, Madras,  through Professor Dr. S. Narasimha Rao, who was of the view  that although 33.3% of fly ash is mixed with gravel there will  not be any increase in the volume of gravel soil.  According to  the complainant, as a counter-blast and with an intention to  cheat the complainant, Soma Enterprise Ltd had hatched a  criminal conspiracy with IIT, Chennai Professors S.R. Gandhi  and Dr. G.R. Dodagoundar and created a fake report to cheat  the complainant and cause wrongful loss to him.  On the basis  of the aforesaid complaint, the complainant requested the  police authorities to investigate into the facts and to try the  case accordingly for having hatched the criminal conspiracy  and cheated the complainant and also misappropriated the  amount of the complainant by making illegal deductions in  aggregate of 28% in all bills and committed breach of trust too  by willfully making the complainant to suffer irreparable loss.  On the basis of the said complaint a case Cr. No. 83 of  2005 was registered in Kovur Police Station on 21st June,  2005, under Sections 196, 199, 120(B), 403, 406 and 418  Indian Penal Code and the original First Information Report  alongwith the original complaint was submitted to the Judicial  Magistrate, 1st Class, Kovur. The Investigating Officer took up the investigation and  found a prima facie case against the accused but as nothing  further was done the petitioner filed Writ Petition No. 21594 of  2005, inter alia for a writ in the nature of Mandamus on the  Sub-Inspector of Police, Kovur Police Station, District Nellore,  to file the Final Report in connection with FIR No. 83 of 2005  before the Additional Judicial Magistrate, 1st Class, Kovur.   The Writ petition was disposed of on 7th October, 2005, at the  admission stage directing the Sub-Inspector of Police, Kovur  Police Station, to file the Final Report before the Magistrate  concerned, if the investigation had been completed, within  four weeks from the date of receipt of a copy of the order. Soon after the aforesaid order of the High Court, the  respondents Nos. 2 and 5 filed Crl. P. No. 4799 of 2005 before  the Andhra Pradesh High Court under Section 482 of the Code  of Criminal Procedure for quashing the aforesaid F.I.R. No. 83  of 2005 of Kovur Police Station, District-Nellore. The said petition came up for hearing and disposal on  28th April, 2006.  On a consideration of the complaint the High  Court observed that the complaint did not disclose any offence  except a civil dispute between the parties.  Holding the  impugned proceedings to be unsustainable, the High Court  quashed the same.  In passing the order quashing the  impugned proceeding, the High Court took note of the earlier  order of the High Court in W.P. No. 21594 of 2005, directing  the police authorities to file a Final Report in connection with

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F.I.R. No. 83 of 2005 of Kovur Police Station. Mr. R.K. Anand, learned Senior Advocate, appearing for  the complainant/petitioner submitted that having noticed the  earlier order passed in W.P. No. 21594 of 2005, the High Court  should have stayed its hands in the quashing proceedings till  the Final Report was filed in respect of the very same F.I.R.  under challenge in the quashing proceedings.   He also urged  that a clear case of cheating and criminal breach of trust  emerges from the complaint, as was found by the Investigating  Officer, and the High Court erred in quashing the proceedings  thus preventing the investigating agency from carrying out its  investigation into the complaint and filing its report. In support of his submission Mr. Anand referred to and  relied on a decision of this Court in Indian Oil Corporation vs.  NEPC India Ltd., reported in 2006 (6) SCC Page 736, wherein  it was held that where civil remedy is availed of in disputes  arising from a breach of contract, remedy under the criminal  law also is not barred, if the allegations also disclose a  criminal offence. Certain other decisions on the same lines were also cited  which only reiterates the same proposition.   Appearing for the respondents, Mr. Abhishek Singhvi,  learned Senior Advocate, urged that he had no quarrel with  the decisions cited by Mr. Anand, but that the same had no  application to the facts of this case.   He emphasised the fact  that the contract between the parties commenced in 2002 and  till 2004 no objections regarding criminal intent on the part of  the respondents was ever raised.   He also emphasised that  the nature of the work entrusted to the petitioner was to  excavate gravel from the respondent’s land and to deliver the  same to the work site.   There was no entrustment involved,  and the allegations in the complaint made out a purely civil  dispute relating to measurement of the gravel delivered to the  work site. Even on the question of alleged fabrication of documents,  Mr. Singhvi submitted that the same related to opinion of  experts in the field who were professors working in I.I.T.  Chennai, and were experts in Civil Engineering. Wild  allegations of criminal conspiracy had been leveled against  them by the petitioner. Mr. Singhvi referred to and relied on a decision of this  Court in Madhavrao Jiwajirao Scindia & Ors. vs. Sambhajirao  Chandrojirao Angre & Ors., reported in 1988 (1) SCC page  692, where this Court had occasion to observe that though a  case of breach of trust may be both a civil wrong and a  criminal offence but there would be certain situations where it  would pre-dominantly be a civil wrong and may or may not  amount to a criminal offence.   It was also observed 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 prima facie established  the offence. We have carefully gone through the complaint made by  the petitioner, and are convinced that the same primarily  makes out a civil dispute relating to measurement, though an  attempt has been made to give the same a criminal flavour.     The High Court rightly held that the entire reading of the  complaint does not disclose any offence except a civil dispute  between the parties. We, therefore, see no reason to interfere with the order of  the High Court impugned in this Special Leave Petition,  though the High Court after noticing its earlier order dated 7th  October, 2005, in Writ Petition No. 21594 of 2005, could have  stayed its hands till the Final Report was filed in connection  with F.I.R. 83 of 2005 of Kovur Police Station.

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The Special Leave Petition is accordingly dismissed.