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CASE NO.: Appeal (crl.)  1392 of 2007

PETITIONER: Inder Mohan Goswami & Another

RESPONDENT: State of Uttaranchal & Others

DATE OF JUDGMENT: 09/10/2007

BENCH: CJI,R. V. Raveendran & Dalveer Bhandari

JUDGMENT: J U D G M E N T (Arising out of SLP (Criminal) No.3658 of 2004)

Dalveer Bhandari, J.

       Leave granted.

       This appeal is directed against the judgment dated 16th  July, 2004 passed in Criminal Miscellaneous Application  No.248 of 2003 under section 482 of the Code of Criminal  Procedure (for short Cr.P.C.) by the High Court of Uttaranchal  at Nainital.  The appellants had to file an application under  Section 482 Cr.P.C. because the Special Judicial Magistrate,  Rishikesh issued a non-bailable warrant against the  appellants on the basis of First Information Report under  Sections 420/467 IPC filed by the respondents.  

Basic Facts         In 1923, Pt. Madan Mohan Malviya founded Sanatan  Dharma Pratinidhi Sabha, Punjab (hereinafter referred as \023the  Sabha\024).   Some of the objects of the Sabha are to open and  maintain temples, dharamshalas, ashrams and to manage  schools and colleges for the overall development of children.  Moreover, it seeks to open hospitals for the poor and to  develop the physical and mental state of the youth etc.  It is  averred that the Sabha from its inception is engaged in the  work of uplifting backward and downtrodden people and is a  grass root organization in the field of social development.  The  Sabha was registered in the year 1949 under the Societies  Registration Act.   

       In order to develop a Ghat on the bank of river Ganga  near Sapatrishi Ashram in Hardwar, the Sabha issued an  advertisement in the newspapers; it invited bids from the  eligible civil contractors to construct the Ghat in consideration  of 13.5 Bighas (approximately) of its land situated in old  Khasra No.140 and new Khasra Nos.61, 62, 63, 64, 65, 66,  67, 68 and part of 89, 90 in village Haripur Kalan, Rishikesh,  Dehradun out of the total land of 26 Bighas owned by the  Sabha.  The Ghat was so constructed by one Himmat Rai  Ahuja, respondent no.3 herein, on behalf of M/s Ahuja  Builders.   

    On completion of the construction of the Ghat, the Sabha  through its President Pt. Mohan Lal Sharma executed a  General Power of Attorney on 13.12.1996 in favour of  respondent no.3 in regard to the abovementioned land

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measuring 13.5 Bighas (out of the total of 26 Bighas  approximately).  On the same date, a receipt of Rs.17,92,000/-  lakhs (approximately) was issued by the Sabha to respondent  no.3 as an adjustment towards the cost of construction of the  Ghat for which the said land of 13.5 Bighas was transferred by  executing a General Power of Attorney dated 13.12.1996 in  favour of respondent no. 3.  On the same day the parties  executed an agreement to sell the remaining land situated at  Old Khasra No.140 and new Khasra No.89 in Village Haripur  Kalan, Rishikesh at the rate of Rs.1,35,000/- per Bigha (which  was approx. 11.19 Bighas).  In pursuance to this, an earnest  money of Rs.4,00,000/- was received by the Sabha from  respondent no.3.  As per the agreement, respondent no.3 had  to pay another Rs.1,00,000/- to the Sabha by 31.1.1997.  This  amount was paid by respondent no.3 on 21.3.1997 and the  balance amount of Rs.10,10,650/- had to be paid by  31.3.1997.   

       According to the appellants, time was the essence of the  contract and respondent no.3 had failed to pay the balance  amount by Rs.10,10,650/-.  The Sabha had sent a legal notice  dated 3.4.1999 (first legal notice) to respondent no.3 to fulfill  his contractual obligations under the sale agreement and  informing that if he failed to do so, the agreement to sell would  stand cancelled and the amount paid as earnest money would  be forfeited.  In reply to the said notice, respondent no.3 vide  his reply dated 5.5.1999 stated that he had not defaulted in  payment of the remaining amount.  He stated in the reply that  as per the agreement the land had to be measured and that he  was ready to pay the balance amount once that was done.

       Pt. Mohan Lal Sharma, the President of the Sabha,  expired on 30.8.1999.  On 5.1.2000, both the parties i.e. the  representative of the Sabha and the representatives of M/s  Ahuja Builders met at the site of the disputed land in the  presence of Patwari (Revenue Official).  The land of old Khasra  No.140 and new Khasra Nos.61, 62, 63, 64, 65, 66, 67, 68 and  part of 89, 90 was measured by the Patwari.  The balance  land, after adjusting the land given in lieu of construction of  the Ghat, came out to be 11.19 Bighas.  The total sale  consideration for this land worked out to be Rs.15,10,650/-.   Respondent no.3 had already paid Rs.4,00,000/- as earnest  money out of this amount.  He had paid a further sum of  Rs.1,00,000/- on 21.3.1997.  On the request of respondent  no.3, the Sabha reduced the amount owed of Rs.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 of Rs.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.

       The General Power of Attorney executed by Late Mohan  Lal Sharma, President of the Sabha, had ceased to be in effect  after his death.  Therefore, the need of a fresh power of  attorney was felt and respondent no.3 desired that the fresh  Power of Attorney be executed in the name of his 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 of  the Sabha, appellant no.1 herein, executed a fresh General  Power of Attorney on 15.1.2000 in respect of 13.5 Bighas of  land situated in part of Old 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 of Suresh

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Ahuja (respondent no.4) as per the request of respondent no.3.         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.

       The appellants submitted that the Sabha had learnt from  reliable sources and from the office of the Registrar of  Properties that respondent no.3, by misrepresentation and by  misusing his General Power of Attorney for the 13.5 Bighas of  land, was attempting to sell the entire 26 Bighas of the  Sabha\022s land to 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 of land in favour of various parties.  The Sabha also  discovered 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 executing three registered sale deeds.  Such  sales could not give any title to respondent no.3.           On 30.4.2001, appellant no.1 sent a legal notice (second  notice) to respondent nos.3 and 4 informing them that if the  balance amount of Rs.8,00,000/- was not paid, he would have  to cancel the General Power of Attorney.   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 notice of the same was also published  by the Sabha in a local newspaper \023Amar Ujala\024, a Hindi daily  on 25.10.2002.  The notice informed the general public about  the cancellation of the General Power of Attorney given to  respondent no.4.  According to the appellants, in order to  protect the interest of the Sabha, the remaining land of 11.19  Bighas of Khasra No.140 was sold to one Sunil Kumar on  \023as  is where is basis\024 on 18.12.2002.

       Having committed breach of his contractual obligations,  respondent no.3 filed a criminal complaint to the SHO of  Raiwala, Rishikesh police station on 23.4.2003 against the  appellants and three other persons alleging that he had been  cheated by the appellants in connivance with other persons by  selling a portion of his land to a third party and by cancelling  the General Power of Attorney.  After examining the matter,  the SHO arrived at the conclusion that no cognizable offence  had been committed and the dispute in question was of civil  nature for which the civil remedy is available in law.

       Respondent no.3 filed another complaint on the same  day, i.e. 23.4.2003, to the Senior Superintendent of Police,  Dehradun and got the FIR registered against the appellant and  three other persons.  The allegation of respondent no.3 was  that the appellants in connivance with other persons had sold  the part of land situated in Old Khasra No.140 and new  Khasra No.89 which had been transferred to them by way of  General Power of Attorney.  The FIR was registered on  23.4.2003 as Case No.26 of 2003 under sections 420, 467 and  120-B IPC.             It may be pertinent to mention that on 27.5.2003,  respondent no.3 filed a civil suit in the court of Civil Judge  (Senior Division) against the Sabha bearing Original Suit  No.302 of 2003 titled Himmat Rai Ahuja v. Sanatan  Dharam Pratinidhi Sabha.  In this suit, respondent no.3

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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 of the land in dispute and also the issue of correct  demarcation of land in Khasra No.140 are pending  adjudication in a competent civil court.            On the basis of the 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 of the Special Judicial Magistrate, Rishikesh.            Aggrieved by the filing of the false and incorrect charge- sheet in the court of Special Judicial Magistrate, Rishikesh in  Criminal Case No.1728 of 2003 titled State v. Inder Mohan  Goswami & Others, the appellants filed a Criminal  Miscellaneous Application No.248 of 2003 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 behalf of the State by Shri  Dinesh Kumar Sharma, SHO, Raiwala Police Station, in which  two points were raised: 1.      That, appellant no.1 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.

    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.      The appellants submitted that first appellant cancelled  the power of attorney 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\022s 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  mala fide 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\022 cancelling the power of attorney and selling a part  of the land to Sunil Kumar to protect the interests of the  Sabha by no stretch of the imagination attracts ingredients of  the offences of sections 467, 420 and 120B IPC.    According to  the appellants, the entire issue relates to ascertaining the  right, title of the 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

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and is pending adjudication.  The appellants 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 of the 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.               The appellants in the rejoinder submitted that the trial  court was not justified in taking cognizance of the matter  when no prima facie case was made out against the  appellants.  The trial court gravely erred in not appreciating  the complete facts of the 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 of the land for which an agreement  to sell was procured, by misusing the Power of Attorney 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 120B/467/468/471 IPC.  The  criminal case was registered as Case No.1306 of 2003 titled as  I.M. Goswami v. Suresh Ahuja.  The Special Judicial  Magistrate vide order dated 12th May, 2005 had issued  summons to respondent nos.3 and 4.              The appellants submitted that in the impugned  judgment, the High Court had also disregarded the settled  legal position crystallized by various judgments of this court  and declined to quash the criminal proceedings against the  appellants.          We have heard the learned counsel for the parties at  length.  The appellants who are office-bearers of a charitable  organization, namely, Sanatan Dharma Pratinidhi Sabha, in  order to protect the interests of the 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\022s  earnest money had been forfeited.  All of this was only done  after appellants had given respondents due notice.   

             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 of civil nature and respondent  no.3 has already instituted a civil suit in the court of Civil  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 of the court. Scope and ambit of courts\022 powers under section 482  Cr.P.C.

    This court in a number of cases has laid down the scope  and ambit of courts\022 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 of which  alone it exists, or to prevent abuse of the process of the court.  

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Inherent power under section 482 Cr.P.C. can be exercised: (i)     to give effect to an order under the Code;  (ii)    to prevent abuse of the process of court, and  (iii)   to otherwise secure the ends of justice.            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 this section itself.  Authority of the  court exists for the advancement of justice.  If any abuse of the  process leading to injustice is brought 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.   Discussion of decided cases

    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 of justice.  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 of the  inherent power when he observed that it is only if the  prosecution amounts to an abuse of the process of the court  and is oppressive and vexatious that the judge has the power  to intervene.  He further mentioned that the court\022s power to  prevent such abuse is of great constitutional importance and  should be jealously preserved.              In R.P. Kapur v. State of Punjab AIR 1960 SC 866, this  court summarized some categories of cases 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  of the proceedings;

(ii)    where the allegations in the first information  report or complaint taken at their 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.

       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 a prima 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  of such magnitude that they cannot be seen in their true  perspective without sufficient material.  Of course, no hard

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and fast rule can be laid down in regard to cases in which the  High Court will exercise its extraordinary jurisdiction of  quashing the proceedings at any stage.            This court in State of Karnataka v. L. Muniswamy &  Others (1977) 2 SCC 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 of the process of  the court or that the ends of justice require that the  proceeding ought to be quashed.  The High Courts have been  invested 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 of justice are higher than the ends of mere  law though justice must be administered according to laws  made by the legislature.  This case has been followed in a large  number of subsequent cases of this court and other courts.            In Chandrapal Singh & Others v. Maharaj Singh &  Another (1982) 1 SCC 466, in a landlord and tenant matter  where criminal proceedings had been initiated, this Court  observed in para 1 at page 467 as under:-      \023A 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 of the process of law. The facts when stated  are so telling that the further discussion may  appear to be superfluous.\024                     The court noticed that the tendency of perjury is very  much on the increase.  Unless the courts come down heavily  upon such persons, the whole judicial process would come to  ridicule.  The court also observed that chagrined and  frustrated litigants should not be permitted to give vent to  their frustration by cheaply invoking jurisdiction of the  criminal court.      This court in Madhavrao Jiwajirao Scindia & Others  v. Sambhajirao Chandrojirao Angre & Others (1988) 1 SCC  692 observed in para 7 as under:      \0237.     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  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 of justice  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 of the  court chances of an 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 of a case also quash  the proceeding even though it may be at a  preliminary stage.\024                   In State of Haryana & Others v. Bhajan Lal & Others  1992 Supp. (1) SCC 335, this court in the backdrop of

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interpretation of various relevant provisions of the Cr.P.C.  under Chapter XIV and of the principles of law enunciated by  this court in a series of decisions relating to the exercise of the  extraordinary power under Article 226 of the Constitution of  India or the inherent powers under section 482 Cr.P.C. gave  the following categories of cases by way of illustration wherein  such power could be exercised either to prevent abuse of the  process of the court or otherwise to secure the ends of justice.   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 of cases wherein such  power should be exercised: \023(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 their  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 under  Section 156(1) of the Code except under an order of  a 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 of the 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 of a Magistrate  as contemplated under Section 155(2) of the Code. (5)     Where the allegations made in the FIR or  complaint are 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. (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 of  the proceedings and/or where there is a specific  provision in the Code or the concerned Act,  providing efficacious redress for the grievance of the  aggrieved party. (7)     Where a criminal proceeding is manifestly  attended with mala 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.            This court in Janata Dal v. H. S. Chowdhary & Others  (1992) 4 SCC 305 observed thus: \023132.        The criminal courts are clothed with  inherent power to make such orders as may be  necessary for the ends of justice.  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

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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 of this power is based on sound  principles.\024

          In G. Sagar Suri & Another v. State of UP & Others  (2000) 2 SCC 636,  this court observed that it is the duty and  obligation of the criminal court to exercise a great deal of  caution in issuing the process particularly when matters are  essentially of civil nature.   

    This court in Roy V.D. v. State of Kerala (2000) 8 SCC  590 observed thus:-      \02318.    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 search 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 of the process  of the court; in such a case not quashing the  proceedings would perpetuate abuse of the process  of the 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 of justice.\024      This court in Zandu Pharmaceutical Works Ltd. &  Others v. Mohd. Sharaful Haque & Another (2005) 1 SCC  122 observed thus:-      \023It 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 of the  powers, court would be justified to quash any  proceeding if it finds that initiation/continuance of  it amounts to abuse of the process of court or  quashing of these proceedings would otherwise  serve the ends of justice. When no offence is  disclosed by the complaint, the court may examine  the question of fact. When a complaint is sought to  be quashed, it is permissible to look into the  materials to assess what the complainant has  alleged and whether any offence is made out even if  the allegations are accepted in toto.\024                 In Indian Oil Corporation v. NEPC India Ltd. &  Others (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 interests of lenders/creditors.   The  court further observed that \023any 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.\024                                                                                The question before us is - whether the case of the  appellants comes under any of the categories enumerated in

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Bhajan Lal (supra)?  Is it 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? For determination of the question it becomes  relevant to note the nature of the offences alleged against the  appellants, the ingredients of the offences and the averments  made in the FIR/complaint.                                                                               In the instant case, the first information report has been  registered under sections 420/467/120B IPC.   The allegations  leveled in the first information report are of (1) cheating and (2)  forgery.   

Analysis of relevant provisions of law      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:  \023415. Cheating.\027Whoever, 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 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 property, is said to \021cheat\022.      Explanation.\027A dishonest concealment of facts  is a deception within the meaning of this section.\024                 Section 415 IPC thus requires \026 1.  deception of any 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 property.                     On a reading of the aforesaid section, it is manifest that  in the definition there are two separate classes of acts 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 of acts 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 of cases, the inducing must be fraudulent or dishonest.   In the second class of acts, the inducing must be intentional  but need not be fraudulent or dishonest.  Therefore, it is the  intention which is the gist of the offence.  To hold a person  guilty of cheating it is necessary to show that he had a  fraudulent or dishonest intention at the time of making 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.         We shall now deal with the ingredients of section 467  IPC.  Section 467 IPC reads as under: \023467. Forgery of valuable security, will etc.\027 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

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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 the payment of money, or an  acquittance or receipt for the delivery of any  moveable property or valuable security, shall be  punished with imprisonment for life, or with  imprisonment of either description for a term which  may extend to ten years, and shall also be liable to  fine.\024                       The following ingredients are essential for commission of  the 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 of offence under Section 467 are  altogether missing even in the allegations of the FIR against  the appellants.  Therefore, by no stretch of the imagination,  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 out against the appellants.  To prevent abuse  of the process and to secure the ends of justice, it becomes  imperative to quash the FIR and any further proceedings  emanating therefrom.               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 of the aforementioned cases, we are of the opinion  that it is neither possible nor desirable to lay down an  inflexible rule that would govern the exercise of inherent  jurisdiction.  Inherent jurisdiction of the 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 itself and in the  aforementioned cases.  In view of the settled legal position, the  impugned judgment cannot be sustained.

       Before parting with this appeal, we would like to discuss  an issue which is of great public importance, i.e., how and  when warrants should be issued by the Court?  It has come to  our notice that in many cases that bailable and non-bailable  warrants are issued casually and 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  following two cases.

    In Omwati v.State of UP & Another (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 non-bailable warrants put the  complainant of the case behind bars without going through

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the facts of the case.  This Court observed that the  unfortunate sequel of such 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 of the case were not considered in  proper perspective before passing the orders.  The court also  observed that some degree of care is supposed to be taken  before issuing warrants.                     In State of U.P. v. Poosu & Another (1976) 3 SCC 1 at  para 13 page 5, the Court observed:            \023Whether in the circumstances of the 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 of which this  discretion is exercised.  Broadly speaking, the court  would take into account the various factors such as  the nature and seriousness of the offence, the  character of the evidence, circumstances peculiar to  the accused, possibility of his absconding, larger  interest of the public and the State.   

Personal liberty and the interest of the State

       Civilized countries have recognized that liberty is the  most precious of all the human rights.  The American  Declaration of Independence 1776, French Declaration of the  Rights of Men and the Citizen 1789, Universal Declaration of  Human Rights and the International Covenant of Civil and  Political Rights 1966 all speak with one voice - liberty is the  natural and inalienable right of every human being.  Similarly,  Article 21 of our Constitution proclaims that no one shall be  deprived of his liberty except in accordance with the procedure  prescribed by law.                 The issuance of non-bailable warrants involves  interference with personal liberty.  Arrest and imprisonment  means deprivation of the most precious right of an individual.   Therefore, the courts have to be extremely careful before  issuing non-bailable warrants.

       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 of a civilized society.   Sometimes in the larger interest of the Public and the State it  becomes absolutely imperative to curtail freedom of an  individual for a certain period, only then the non-bailable  warrants should be issued.

When non-bailable warrants should be issued   

       Non-bailable warrant should be issued to bring a person  to court when summons of bailable 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

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the person to serve him with a summon;  or *       it is considered that the person could  harm someone if not placed into custody  immediately.

    As far as possible, if the court is of the 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 of facts and complete  application of mind, due to the extremely serious  consequences and ramifications which ensue on issuance of  warrants.  The court must very carefully examine whether the  Criminal Complaint or FIR has not been filed with an oblique  motive.               In complaint cases, at the first instance, the court should  direct serving of the summons along with the copy of the  complaint.  If the 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\022s proceeding  intentionally, the process of issuance of the non-bailable  warrant should be resorted to.   Personal liberty is paramount,  therefore, we caution courts at the first and second instance to  refrain from issuing non-bailable warrants.               The power being discretionary must be exercised  judiciously with extreme care and caution.  The court should  properly balance both 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 of an 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 of law,  issuance of non-bailable warrants should be avoided.                  The Court should try to maintain proper balance between  individual liberty and the interest of the public and the State  while issuing non-bailable warrant.            On consideration of the totality of facts and  circumstances of this case, the impugned judgment and order  of the High Court cannot be sustained.            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 of the civil suit.               Reverting to the facts of this case, we are of the  considered view that the impugned judgment of the High  Court in declining to exercise its inherent power has led to  grave miscarriage of justice.  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 of  accordingly.  In the facts and circumstances of this case, we  direct the parties to bear their own costs.