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REPORTABLE

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO(S).729-732 OF 2010

RAJIB RANJAN & ORS. …..APPELLANT(S)

VERSUS

R. VIJAYKUMAR …..RESPONDENT(S)

J U D G M E N T

A.K. SIKRI, J.

These  appeals  are  filed  by  four  appellants,  who  were  

arrayed as accused persons in the complaint case No.183/2007 filed  

by  the  respondent  herein  before  the  Court  of  Judicial  Magistrate  

No.II, Tiruchirapalli, Tamil Nadu.  The complaint has been filed under  

Sections 120-B, 468, 420 and 500 of  the Indian Penal Code (for  

short 'the IPC').  The learned Judicial Magistrate took cognizance of  

the said complaint and summoned the appellants.  The appellants  

(who were arrayed as accused Nos.3, 4, 5 and 6) challenged the  

said summoning orders and sought quashment of the complaint by

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filing petition under Section 482 of the Code of Criminal Procedure  

(for short 'the Cr.P.C.) inasmuch as according to them the allegations  

in the complaint did not make out any offence under the aforesaid  

provisions of the IPC; the complainant had neither any locus standi  

nor  any legal  status to prefer  any such complaint;  the appellants  

being public servants and Gazetted officers of the State Government  

of  Chhattisgarh,  no  such  criminal  proceedings  could  be  initiated  

against them without prior sanction from the appointing authority as  

per Section 197 of the Cr.P.C.; and the complaint was blatant misuse  

and  abuse  of  the  process  of  Court  which  was  filed  by  the  

complainant  after  exhausting  the  civil  remedies  in  which  he  had  

failed.   The High Court,  after examination of the matter,  has not  

found any merit  in any of the aforesaid contentions raised by the  

appellants and, consequently, dismissed their petitions.   

2. Before we advert to the submissions of the appellants, which are  

mirror image of what was argued before the High Court, it would be  

appropriate to traverse through the relevant facts and events leading  

to the filing of the said complaint by the complainant.  These are as  

under:

The  Chhattisgarh  State  Electricity  Board  (for  short  'the  

CSEB') issued an advertisement inviting tender (NIT) bearing No. T-

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136/2004 dated 02.06.2004 for its work at Hasedeo Thermal Power  

Station  (Korba  West)  towards  Designing,  Engineering,  Testing,  

Supply,  Erection  &  Commission  of  HEA  Ignition  system.   The  

applications received there under were required to be processed in  

three  stages  successively  namely;  Part-I  (EMD);  Part-II  (Techno-

Commercial Criteria) and Part III (Price Bid).  The respondent herein  

submitted an application on 26.08.2004 as Chief Executive Officer of  

M/s Control  Electronics India (CEI) requesting for Tender Document.  

The application was rejected on the ground that it was accompanied  

by  incomplete  documents  i.e.  non-submission  of  documentary  

evidence of  past  performance and experience of  the respondent.  

The  respondent  made  a  complaint  dated  06.09.2004  against  

appellant No. 3 herein alleging that the Tender Documents were not  

issued  to  the  respondent.   It  was  followed  by  several  letters  

requesting for issuance of Tender Documents.  He was informed that  

rather  than pressurising the appellants  here or  other  officials,  he  

should  furnish  documents  as  per  pre-qualifying  condition  of  the  

Tender.  In response thereto, vide his letter dated  05.11.2004, the  

respondent filed a copy of purchase order dated 28.01.2002 placed  

by  Jharkhand  State  Electricity  Board  (for  short  'the  JSEB')  and  

assured to supply other documentary evidence (performance report)  

subsequently.  On  such  assurance,  the  Tender  Documents  were

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issued  to  the  respondent.   The  respondent  vide  his  letter  dated  

08.12.2004, mentioned that the Performance Report was enclosed  

in Part-II. However, the said report was not found enclosed and even  

after  repeated  requests  from  the  CSEB  to  furnish  documents,  

respondent  did  not  fulfill  the  necessary  requirement.   As  the  

respondent  did  not  submit  the  necessary  documents,  the  CSEB  

sought the information from the Chief Engineer of JSEB (arrayed in  

the complaint as accused No.2) vide letter dated 10.12.2004 about  

the performance of the respondent.  Appellant No.2 herein was also  

deputed to get the desired information from JSEB.  After meeting the  

officials of JSEB, appellant No.2 submitted his report stating that the  

works carried out by the respondent were not satisfactory as many  

defects were found therein.  As per the appellants, even technical  

expertise was sought from SE (ET&I) KW (CSEB) and found that the  

respondent was not technically suitable as per the technical vetting  

and comparative data of SE (ET&I) KW letter dated 04.02.2005.  On  

that basis, tender of the respondent was rejected.  The appellants  

submit that as an outburst, in not getting the Tender in his favour, the  

respondent  made complaints alleging irregularities to various fora  

including the State Government, which ordered the CSEB to conduct  

an enquiry.  The CSEB submitted its report on  21.02.2006 stating  

that there were no such irregularities and that the respondent had

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not furnished the necessary documents despite repeated requests.  

At this stage, the respondent filed the Civil Suit (26-A/06) before the  

Civil  Judge  Class-II,  Korba  against  the  CSEB.   However,  the  

respondent moved an application seeking to withdraw the said suit.  

In any case he did not appear on the date fixed and accordingly the  

suit  was  dismissed  for  non-prosecution  on  12.09.2006.   The  

respondent herein then filed a Writ Petition No.2951 of 2006 before  

the Chhattisgarh High Court which was dismissed on  25.06.2007.  

Even costs of  Rs.25,000/-  was imposed while  dismissing the writ  

petition with the observations that it  was abuse of the process of  

Court.   Thereafter,  SLP No.15897  of  2007  was  preferred  by  the  

respondent  which  also  came  to  be  dismissed  vide  order  dated  

14.09.2007.   After  the  exhaustion  of  these  remedies,  albeit  

unsuccessfully, the respondent filed a complaint before K.K. Nagar  

P.S., Thirucharapalli, Tamil Nadu.  The police authorities refused to  

register  the  same on  the  ground  that  it  is  a  civil  dispute.   It  is,  

thereafter,  that  the  respondent  filed  the  said  Criminal  Complaint  

under Sections 120-B, 468, 420 & 500 IPC before the trial Court,  

which was registered as C.C. No. 183/07 and the trial Court issued  

summons to the appellants herein and accused No.1 (Successful  

Bidder)  & accused No. 2 (then Chief Engineer, JSEB).   Petitions of  

the appellants seeking quashing of the said complaint  have been

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dismissed by the order of the High Court, which is impugned before  

us.

3. A  reading  of  the  said  complaint  reveals  the  following  broad  

allegations levelled by the respondent:

(a)   The  respondent/complainant  alleges  that  the  appellants  and  

accused  No.1  (Successful  Bidder)   &  accused  No.  2  (then  

Chief Engineer, JSEB) had conspired secretly to disentitle the  

complainant’s company by creating a discredit and for the said  

purpose, they were in constant touch so as to create the said  

Performance  Report  Cum  Certificate,  which  was  issued  by  

accused No.2.

(b) The respondent/complainant alleges that the said conspiracy  

started with an agreement entered into by the 1st accused and  

the appellants herein and they planned to fabricate the said  

certificate dated 28.12.2004.  For this purpose, accused No. 2  

was  approached  so  as  to  tailor  the  certificate  totally  

discrediting  the  CEI  (Company  of  the  Complainant)  with  

reference  to  supply  and  service  relationship  with  Patratu  

Thermal Power Station (for short 'the PTPS') and JSEB.

(c) The respondent/complainant  alleges that  the said  Certificate

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cum Report  is false,  fabricated,  motivated and malafide and  

the  same  was  contrary  to  the  minutes  of  meeting  that  the  

complainant and his officials had with the officials of PTPS and  

JSEB.   He  further  alleges  that  for  the  said  reasons,  the  

accused No. 2 was demoted from his post.

(d) The respondent/complainant alleges that on suspicion of such  

Certificate Cum Report, the complainant visited the CSEB and  

on verifying about the same, he found that the said tender was  

being  given  to  Company  of  the  1st accused  against  the  

Complainant’s Company and so he wrote a letter to the Chief  

Secretary and Chairman of JSEB for verifying and cancelling  

such certificate. He also wrote to many officials of the CSEB.

(e) The respondent/complainant alleges that the said Certificate is  

perse defamatory as against the complainant’s company and is  

a crude attempt to favour accused No.1 by spoiling the image  

of  the  Complainants  company.   He  further  alleges  that  this  

caused  a  wrongful  loss  to  the  complainant’s  company  by  

robbing its due chance to get a contract for the Boiler Plant  

Units at Korba.  

4. After recording preliminary evidence, the Magistrate took cognizance

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of  the  complaint  which  order  was  challenged  in  the  High  Court.  

Before the High Court, the appellants, inter alia, contended that the  

allegations made by the respondent under Sections 120-B, 468, 420  

& 500 of IPC pertained to the award of tender in favour of accused  

No.1 in which the respondent was also a competing party.  It was  

also  pleaded  that  the  said  complaint  has  been  lodged  as  an  

afterthought, having failed in the civil suit for injunction which was  

dismissed and likewise, after unsuccessful attempt to challenge the  

award of contract in favour of accused No.1 as the writ petition of the  

respondent was dismissed by the High Court.  Thus, the lodging of  

complaint before Judicial Magistrate-II, Tiruchirapalli was nothing but  

abuse of process of law.  The appellants also contended that the  

respondents herein had no locus standi nor any legal status to prefer  

the said complaint,  as CEI is not a registered company, having a  

legal entity.  The appellants further relied on Naresh Kumar Madan  

v. State of M.P., (2007) 4 SCC 766 wherein it has been held that an  

employee  working  in  the  Electricity  Board  is  covered  under  the  

definition  of  ‘Public  Servant’  and  State  of  Maharashtra v.  Dr.  

Budhikota Subbarao, (1993) 2 SCC 567 for the proposition that the  

absence  of  sanction  order  from  the  appropriate  authority  under  

Section  197  Cr.P.C  for  prosecuting  a  public  servant,  vitiates  the  

proceedings.

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5. The respondent refuted the aforesaid submissions by arguing that  

the appellants herein had deliberately conspired and had committed  

the offences against the complainant and therefore he has a right to  

lodge a complaint for the offences committed by the appellants along  

with accused No. 2 (Chief Engineer, JSEB) in rejecting the tender  

submitted by the complainant with a view to accept the tender of the  

1st accused.  It  was argued that they conspired and created false  

document with an idea of rejecting the claim of the complainant.  The  

respondent further submitted that  complainant's locus standi as a  

company was not questioned in the earlier proceedings before the  

Chhattisgarh High Court and that the Judicial Magistrate had applied  

his mind and after satisfying himself that the complainant/respondent  

has  got  legal  status  to  lodge  the  said  complaint,  had  taken  

cognizance of the offences committed by the accused persons.  It  

was also contended that the question of obtaining sanction under  

Section 197 Cr.P.C. will not arise in so far as the present complaint is  

concerned,  as  the accused are  charged for  conspiracy,  cheating,  

criminal breach of trust and defamation.  He further submitted that  

his  allegation  in  the  complaint  pertained  to  the  fabrication  of  the  

Certificate-cum-Report  dated  28.12.2004 which  was  used against  

him in rejecting his tender and 1st accused was favoured with the

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award of work.  Therefore, they had committed offences against the  

complainant  and  damaged  the  reputation  of  the  respondent/  

complainant.

6. The  High  Court  while  dismissing  the  petition  of  the  appellants  

recorded that:

(a) As  far  as  mandatory  provisions  of  Section  197  Cr.P.C  is  

concerned,  the High Court  accepted that  the appellants are  

‘Public Servants’. It also observed that if the accusation against  

the appellants under Sections 120-B, 468, 420 & 500 IPC are  

connected with the discharge of their duty viz. if the said acts  

had  reasonable  connection  with  discharge  of  his  duty  then  

applicability of Section 197 cannot be disputed.  However, on  

going through the allegations in the complaint, the High Court  

held that even though the appellants are “Public Servant’, the  

alleged offences committed by them are cognizable offences  

are not in discharge of their normal duties, in which component  

of criminal breach of trust is found as one of the elements and  

hence the provisions of Section 197 Cr.P.C. are not attracted.

(b) It  has  also  been  observed  that  the  evidence  regarding  the  

allegations made in the complaint  have to be recorded and  

gone  into  by  the  trial  court  after  the  evidence  have  been

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adduced by  the  complainant.  It  is  only  thereafter  the  lower  

Court,  can  decide  as  to  whether  the  allegations  about  the  

falsity of the Certificate with conspiracy of accused No. 2 and  

the appellants herein are correct or not.

7. It  is  clear  from  the  above  that  primarily  two  questions  arise  for  

consideration namely:

(a) Whether prior sanction of the competent authority to prosecute  

the  appellants,  who  are  admittedly  public  servants,  is  

mandatory under Section 197 of the Code?

(b) Whether, on the facts of this case, the complaint filed by the  

respondent  is  motivated  and  afterthought,   after  losing  the  

battle in civil  litigation and amounts to misuse and abuse of  

law?

We would like to remark that having regard to the facts of  

this case the two issues are interconnected and narratives would be  

overlapping, as would become apparent when we proceed with the  

discussion hereinafter.

8. For this purpose, we would first like to point out that the High Court  

has itself taken note of the judgment of this Court in the Case of

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Naresh  Kumar  Madan  (supra)  to  hold  that  the  appellants  are  

covered by the description of public servants within the meaning of  

Section  21  of  IPC.   Following  observations  therefrom have  been  

quoted:

“The officers of the State Electricity Board are required to  carry out public functions.  They are public authorities.  Their action in one way or the other may entail civil or  evil  consequences  to  the  consumers  of  electrical  energy.   They may prosecute  a  person.   They are  empowered  to  enter  into  the  house  of  the  Board's  consumers.   It  is  only  for  proper  and  effective  exercise of  those powers,  the statute  provides that  they  would  be  public  servants,  wherefore  a  legal  fiction  has  been  created  in  favour  of  those  employees,  when  acting  or  purported  to  act  in  pursuance of any of the provisions of the Act within  the meaning of Section 21 of the Indian Penal Code.  Indian  Penal  Code denotes  various  persons  to  the  public  servants.   It  is,  however,  not  exhaustive.   A  person  may  be  public  servant  in  terms  of  another  statute.  However we may notice that a person, who,  inter alia, is in the service or pay of the Government  established by or under a Central, Provincial or State  Act,  would  also  come  within  the  purview  thereof.  Section 2 (1) (c) of the 1988 Act also brings within its  embrace  a  person  in  the  service  or  pay  of  a  corporation established by or under a Central Act.”

9. The question is of the applicability of Section 197 of the Code.  Said  

provision with which we are concerned is reproduced below:

“Prosecution of Judges and public servant. (1) When any  person who is or was a Judge or Magistrate or a public  servant not removable from his office save by or with the  sanction  of  the  Government  is  accused  of  any  ofence  alleged to have been committed by him while acting or

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purporting to act in the discharge of his official duty, no  Court shall take cognizance of such offence except with  the previous sanction-

(a)  In the case of a person who is employed, or as the  case may be, was at the time of commission of the  alleged  offence  employed,  in  connection  with  the  affairs of the Union, of the Central Government;

(b)  in the case of a person who is employed or, as the  case may be, was at the time of commission of the  alleged  offence  employed,  in  connection  with  the  affairs of a State, of the State Government.”   

10. This provision makes it clear that if any offence is alleged to have  

been committed by a public servant who cannot be removed from  

the office except  by or  with  the sanction of  the Government,  the  

Court is precluded from taking cognizance of such offence except  

with the previous sanction of  the competent authority specified in  

this provision.

11. The sanction, however, is necessary if the offence alleged against  

public servant is committed by him “while acting or purporting to act  

in  the discharge of  his official  duties”.   In order to find out  as to  

whether the alleged offence is committed while acting or purporting  

to  act  in  the  discharge  of  his  official  duty,  following  yardstick  is  

provided by this Court in  Dr. Budhikota Subbarao  (supra) in the  

following words:

“If on facts, therefore, it is prima facie found that the act or

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omission  for  which  the  accused  was  charged  had  reasonable connection with discharge of his duty then it  must be held to be official to which applicability of Section  197 of the Code cannot be disputed.”

12. This  principle  was explained  in  some more  detail  in  the  case  of  

Raghunath Anant Govilkar  v.  State of Maharashtra,  which was  

decided by this Court on 08.02.2008 in SLP (Crl.) No.5453 of 2007,  

in the following manner:

“On the question of the applicability of Section 197 of the  Code of Criminal Procedure, the principle laid down in two  cases, namely, Shreekantiah Ramayya Munipalli v. State  of  Bombay and Amrik  Singh v.  State  of  Pepsu was as  follows:    

It is not every offence committed, by a public servant that  requires sanction for prosecution under Section 197 (1) of  Criminal Procedure Cod; nor even every act done by him  while he is  actually  engaged in  the performance of  his  official  duties;  but  if  the  act  complained  of  is  directly  concerned with his official duties so that, if questioned, it  could  be  claimed  to  have  been  done  by  virtue  of  the  office, then sanction would be necessary.

The  real  question  therefore,  is  whether  the  acts  complained  of  in  the  present  case  were  directly  concerned  with  the  official  duties  of  the  three  public  servants.   As  far  as  the  offence of  criminal  conspiracy  punishable under Sections 120-B read with Section 409 of  the Indian Penal Code is concerned and also Section 5(2)  of the Prevention of Corruption Act, are concerned they  cannot be said to be of the nature mentioned in Section  197 of the Code of Criminal Procedure.  To put it shortly, it  is no part of the duty of a public servant, while discharging  his official duties, to enter into a criminal conspiracy or to  indulge in criminal misconduct.  Want of sanction under  Section  197  of  the  Code  of  Criminal  Procedure  is,  therefore, no bar.”

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13. Likewise, in  Shambhoo Nath Misra v.  State of U.P. and others,  

(1997) 5 SCC 326, the Court dealt with the subject in the following  

manner:

“5.  The question is when the public servant is alleged  to have committed the offence of fabrication of record  or misappropriation of public fund etc. can be said to  have acted in discharge of his official duties? It is not  the official duty of the public servant to fabricate the  false record and misappropriate the public funds etc.  in  furtherance  of  or  in  the  discharge  of  his  official  duties.   The  official  capacity  only  enables  him  to  fabricate the record or misappropriate the public fund  etc.  It does not mean that it is integrally connected or  inseparably  interlinked  with  the  crime  committed  in  the course of same transaction, as was believed by  the learned Judge.  Under these circumstances, we  are of the opinion that the view expressed by the High  Court as well as by the trial Court on the question of  sanction is clearly illegal and cannot be sustained.”

14. The ratio of the aforesaid cases, which is clearly discernible, is that  

even while discharging his official duties, if a public servant enters  

into a criminal conspiracy or indulges in criminal misconduct, such  

misdemeanor on his part is not to be treated as an act in discharge  

of his official duties and, therefore, provisions of  Section 197 of the  

Code will not be attracted.  In fact, the High Court has dismissed the  

petitions  filed  by  the  appellant  precisely  with  these  observations  

namely the allegations pertain to fabricating the false records which  

cannot be treated as part  of  the appellants normal  official  duties.

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The High Court has, thus, correctly spelt out the proposition of law.  

The only question is as to whether on the facts of the present case,  

the  same  has  been  correctly  applied.   If  one  looks  into  the  

allegations  made  in  the  complaint  as  stand  alone  allegations,  

probably what the High Court  has said may seem to be justified.  

However, a little deeper scrutiny into the circumstances under which  

the complaint came to be filed would demonstrate that allegation of  

fabricating the false record is clearly an afterthought and it becomes  

more than apparent that the respondent has chosen to level such a  

make belief allegation with sole motive to give a shape of criminality  

to the entire dispute, which was otherwise civil in nature.  As noted  

above, the respondent had in fact initiated civil action in the form of  

suit  for  injunction  against  the  award  of  the  contract  in  which  he  

failed.  Order of civil court was challenged by filing writ petition in the  

High  Court.   Plea  of  the  respondent  was  that  the  action  of  the  

Department  in  rejecting  his  tender  and  awarding  the  contract  to  

accused  No.1  was  illegal  and  motivated.   Writ  petition  was  also  

dismissed  with  cost.   These  orders  attained  finality.   It  is  only  

thereafter criminal complaint is filed with the allegation  that accused  

No.1 is favoured by creating a false certificate dated 28.12.2004.  

We would dilate this discussion with some elaboration, hereinafter.

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15. As already pointed above, tender was floated by the CSEB and the  

CEI herein was one of the parties who had submitted its bid through  

the  respondent.   However,  tender  conditions  mentioned  certain  

conditions and it was necessary to fulfill those conditions to become  

eligible  to  submit  the  bid  and  have  it  considered.   As  per  the  

appellants, tender of the respondent was rejected on the ground that  

plant and equipment erected by the respondent at Patratu Thermal  

Power Station, Patratu, Jharkhand was not functioning well.   This  

information  was  received  by  the  Tender  Committee  from  JSEB.  

When  the  report  was  sought  by  CSEB  in  December,  2004,  the  

Tender Committee took the view that the respondent did not fulfill the  

pre-qualifying conditions and rejected his tender.  Before doing so,  

the respondent was asked time and again to send the performance  

report which he had promised but he failed to comply even when he  

had assured to do the needful.  In fact, that itself was sufficient to  

reject that bid of the respondent as it was non compliant with the  

tender conditions.  Still, in order to verify the claim of the respondent  

and to consider his bid on merits, though not strictly required, the  

appellant R.C. Jain was deputed to get the desired information from  

JSEB.   He met the officials of JSEB and submitted his report to the  

effect  that  the  works  carried  out  by  the  respondent  at  Patratu  

Thermal Power Station was not satisfactory.  Even, Shri B.M. Ram,

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General  Manager  of  the  said  Power  Station  furnished  his  report  

dated 28.12.2004 wherein it was summed up that due to the defects  

in the scanning system, supplied by the respondent, generation had  

been  adversely  effected  and  the  said  Electricity  Board  was  not  

satisfied with the equipment supplied by the respondent.  In spite of  

the aforesaid material, the tender Committee acted with caution and  

even the technical  expertise was sought.   Even the report  of  the  

technical experts went against the respondent as it opined that the  

respondent was not technically suitable on the technical vetting and  

comparative  data.   On  the  basis  of  the  aforesaid  material,  the  

respondent's tender document was not opened and returned and he  

was  informed  accordingly.   All  this  has  clearly  happened  in  

furtherance of and in discharge of the official duties by the appellant.  

In the facts of the present case, we are of the view that allegations of  

fabricating the records are mischievously made as an afterthought,  

just to give colour of criminality to a civil case.   

16. As pointed out above, the respondent had even filed the civil  suit  

challenging  the  decision  of  the  Electricity  Board  in  returning  his  

tender documents on the ground that the same were not as per pre-

qualifying conditions of the tender.  He had thus resorted to the civil   

remedy.  However, he failed therein as for the reasons best known to

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him, he sought to withdrew the same and accordingly the same was  

dismissed  for  non-prosecution.   It  is  trite  that  once  the  suit  is  

withdrawn, that acts as constructive res judicata having regard to the  

provision of Order XXIII Rule 1 of the Code of Civil Procedure.  Also,  

when suit is dismissed under Order IX Rule 8 CPC, fresh suit under  

Order IX Rule 9 is barred.  The legal implication would be of that the  

attempt of the respondent in challenging the decision of the Tender  

Committee in not considering his tender remained unfaulted.  Even  

when the respondent himself invited order of dismissal in the civil  

suit,  curiously  enough,  he  filed  a  writ  petition  against  the  order  

passed in the civil court dismissing his suit for non-prosecution, but  

the same was also dismissed by the High Court on 25.06.2007 and  

even a cost of Rs.25,000/- was imposed on the respondent as the  

said  writ  petition  was  perceived  by  the  High  Court  as  'abuse  of  

process of the court'.   SLP preferred by the respondent was also  

dismissed by  this  Court  on  14.09.2007.   It  is  only  thereafter  the  

respondent  filed  the  criminal  complaint  out  of  which  present  

proceedings emanate.  No doubt, the respondent in his complaint  

has right to colour his complaint by levelling the allegations that the  

appellants herein fabricated the records.  However, on the facts of  

this  case,  it  becomes  difficult  to  eschew  this  allegation  of  the  

respondent and we get an uncanny feeling that the contents of FIR

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with these allegations are a postscript of the respondent after losing  

the  battle  in  civil  proceedings  which  were  taken  out  by  him  

challenging  the  action  of  the  Department  in  rejecting  his  tender.  

When he did not succeed in the said attempt, he came out with the  

allegations of forgery.  It is thus becomes clear that the action of the  

respondent  in  filing  the  criminal  complaint  is  not  bonafide  and  

amounts to misuse and abuse of the process of law.

17. In  State of Haryana  v.  Bhajan Lal, 1992 Supp (1) SCC 335, this  

Court  has  laid  down  principles  on  which  Court  can  quash  the  

criminal  proceedings under Section 482 of  Cr.P.C.   These are as  

follows:

“102.(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

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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 Act concerned (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 Act  concerned,  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.”

Principle Nos.6 and 7 are clearly applicable in the present case.    

18. Having regard to the circumstances narrated and explained above,  

we are also of the view that attempt is made by the respondent to  

convert a case with civil nature into criminal prosecution.  In a case  

like  this,  High  Court  would  have  been  justified  in  quashing  the  

proceedings in exercise of its inherent powers under Section 482 of  

the Code.  It would be of benefit to refer to the judgment in the case  

of Indian Oil Corpn. v. NEPC India Ltd. and others, (2006) 6 SCC  

736,  wherein  the  Court  adversely  commented  upon  this  very  

tendency  of  filing  criminal  complaints  even  in  cases  relating  to

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commercial  transaction  for  which  civil  remedy  is  available  is  

available or  has been availed.   The Court  held that  the following  

observations of the Court in this behalf are taken note of:

“13.  While on this issue, it is necessary to take notice of a  growing  tendency  in  business  circles  to  convert  purely  civil  disputes into  criminal  cases.   This  is  obviously  on  account of a prevalent impression that civil law remedies  are  time consuming and do not  adequately  protect  the  interests of lenders/creditors.  Such a tendency is seen in  several  family  disputes  also,  leading  to  irretrievable  breakdown  of  marriages/families.   There  is  also  an  impression that if a person could somehow be entangled  in a criminal prosecution, there is a likelihood of imminent  settlement.  Any effort to settle civil disputes and claims,  which  do  not  involve  any  criminal  offence,  by  applying  pressure  through  criminal  prosecution  should  be  deprecated and discouraged.  In G. Sagar Suri v.  State  of U.P., (2000) 2 SCC 636, this Court observed: (SCC p.  643, para 8)

“It is to be seen if a matter, which is essentially of a civil  nature,  has  been  given  a  cloak  of  criminal  offence.  Criminal  proceedings  are  not  a  short  cut  of  other  remedies  available  in  law.   Before  issuing  process  a  criminal court has to exercise a great deal of caution.  For  the accused it  is a serious matter.  This Court  has laid  certain principles on the basis of which the High Court is  to exercise its jurisdiction under Section 482 of the Code.  Jurisdiction  under  this  section  has  to  be  exercised  to  prevent abuse of the process of any court or otherwise to  secure the ends of justice.”

14.  While no one with a legitimate cause or grievance  should be prevented from seeking remedies available in  criminal law, a complainant who initiates or persists with a  prosecution,  being  fully  aware  that  the  criminal  proceedings are unwarranted and his remedy lies only in  civil law, should himself be made accountable, at the end  of  such  misconceived  criminal  proceedings,  in  accordance with law.  One positive step that can be taken  by  the  courts,  to  curb  unnecessary  prosecutions  and  harassment of innocent parties, is to exercise their power

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under  Section  250  CrPC  more  frequently,  where  they  discern malice or frivolousness or ulterior motives on the  part of the complainant.  Be that as it may.”

19. In  Inder Mohan Goswami and another  v.  State of  Uttaranchal   

and  others,  (2007) 12 SCC 1, the Court reiterated the scope and  

ambit of power of the High Court under Section 482 of the Code in  

the following words:

“23.  This Court in a number of cases has laid down the  scope  and  ambit  of  courts'  powers  under  Section  482  CrPC.  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.  Inherent power under Section  482 CrPC 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.

24.   Inherent  powers  under  Section  482  CrPC  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 could would be  justified  in  preventing  injustice  by  invoking  inherent  powers in absence of specific provisions in the statute.

Discussion of decided 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 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, 1

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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's  power  to  prevent  such  abuse  is  of  great  constitutional  importance  and  should be jealously preserved.

46.  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 pressurise  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 CrPC 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.”

20. As a result, these appeals are allowed.  Order of the High Court is  

set  aside.   Consequently,  cognizance  taken  by  the  learned  

Magistrate  and  orders  summoning  the  appellants  as  accused  is  

hereby set aside resulting into the dismissal of the said complaint.  

There shall however be no order as to costs.

…......................................J. (J. Chelameswar)

…......................................J. (A.K. Sikri)

New Delhi;

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October 14, 2014.