NON REPORTABLE

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO. 199 OF 2018 (@ SPECIAL LEAVE PETITION (CRIMINAL) NO. 978 OF 2018

@DIARY NO. 40579 OF 2017)

SMT. ANITA MARIA DIAS & ANR. .....APPELLANT(S)

VERSUS

THE STATE OF MAHARASHTRA & ANR. .....RESPONDENT(S)

J U D G M E N T

A.K. SIKRI, J.

Delay condoned.  Leave granted.     

2)Respondent No. 2 is the complainant who has lodged the FIR

against the appellants bearing Crime No. 267 of 2012 registered

by  Chatushrungi  Police  Station,  Pune,  Maharashtra  for  the

offence punishable under Sections 406, 420, 467, 471 and 34 of

Indian Penal Code (IPC).  The appellants are original accused

Nos.  2  and 3  in  the said  criminal  proceedings.   They are  the

Directors  of  M/s.  Karl  Logistics  (for  short  ‘said  Company’),  a

company registered under the provisions of Companies Act, 1956

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and is engaged in the business of logistics and iron ore supply

and equipped with all necessary approvals and registrations for

doing the business.  Said Company also had legal authority to

load  and  unload  the  iron  ore  and,  for  that  purpose,  the

Government of Goa had allocated a plot at Kothambi vide letter

No.  111/435/2010-Mines/2214.   M/s.  Consistent  was  doing

business with  the said  Company for  quite  some time and Mr.

Vilas  Birajdar  (Proprietor  of  M/s.  Consistent)  introduced

respondent No. 2 to the appellants since he had interest to invest.

Accordingly,  Memorandum  of  Understanding  (for  short  ‘MoU’)

came  to  be  executed  between  M/s.  Karl  Logistics  (signed  by

appellant No. 2 on its behalf), M/s. Platinum Buildcon (signed by

respondent No.2 on its behalf) and M/s. Consistent (signed by Mr.

Birajdar on its behalf).  According to the terms, it was agreed that

M/s. Platinum Buildcon will invest an amount of Rs. 1.50 crores

with M/s.  Karl  Logistics for  period of one month and would be

entitled to profit of Rs.90 lakhs in addition to its investment of 1.50

crores or Rs. 200 per tonne whichever is maximum.  All payments

were to be made through M/s. Consistent and the entire amount

was to be paid within one week time from signing of the MoU.

M/s.  Karl  Logistics also extended security Cheque No. 208225

drawn on State Bank of India of Rs.2.40 crores in advance to M/s.

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Consistent, who was to act as insurance for both the parties.   

3) According  to  the  appellants,  in  breach  of  the  MoU  dated

November  28,  2011  and,  more  particularly,  in  violation  and

defiance of the term requiring respondent No. 2 to pay the entire

amount of Rs.  1.50 crores within one week from the signing of

the  MoU,  respondent  No.  2  deposited  the  amount  with  M/s.

Consistent in several instalments.  Further, respondent No. 2 did

not deposit the entire amount of Rs.1.50 crores but an amount of

Rs.1.46 crores.  According to respondent No. 2, since no positive

response was received as per the MoU, he tried to pursue Mr.

Birajdar as well as the appellants for compliance of the MoU and

return  of  money.   Accordingly,  two  post  dated  cheques  were

issued by the appellants viz. Cheque No. 208255 dated February

6, 2012 and Cheque No. 208256 dated February 10, 2012 for an

amount  of  Rs.  60  lakhs  and  Rs.1.46  lakhs  respectively.  It  is

contended that the said cheques are signed by appellant No. 1

and the appellants assured that these would be honoured on the

due dates mentioned thereupon.  According to respondent No. 2,

he deposited Cheque No. 208255 on December 6, 2012 with his

banker, however, the same was returned and when the appellants

were informed about the same, he was instructed to deposit the

same  again.   But  it  met  the  same  fate.   Respondent  No.  2

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initiated  proceedings  under  Section  138  of  the  Negotiable

Instruments Act bearing CC No. 19227 of 2012 in the Court of Ld.

Judicial Magistrate, First Class, Pune, Maharashtra.  Thereafter,

on   August 2, 2012, he also lodged FIR bearing Crime No. 267 of

2012 with Chatushrungi Police Station, Pune, Maharashtra for the

offence punishable under Sections 406, 420, 467, 471 and 34 of

IPC alleging that  the appellants and original  accused No.1/Mr.

Birajdar has committed fraud.     

4) The appellants moved the application for anticipatory bail in the

aforesaid proceedings which was granted by the High Court of

Judicature  at  Bombay.   In  the  meantime,  the  parties  started

negotiating  with  each  other.   These  settlement  talks  were

fructified into a settlement dated November 2, 2012 when consent

terms came to  be executed between the parties.   As per  this

settlement, the appellants were required to deposit an amount of

Rs. 1,42,50,000/- in two instalments with the Registry of the High

Court  and  this  amount  was  to  be  invested  in  Fixed

Deposits/Bonds, pending trial.   

5) In accordance with the said settlement, the appellants deposited

Rs.87 lakhs in the Registry of the High Court.  As the appellants

were not in a position to deposit further amount as agreed, due to

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their precarious financial condition, they approached respondent

No.  2 again to work out  the possibility of  deciding the dispute

once and for all.  Discussions ensued and the parties were again

successful in settling the matter.  It was agreed that respondent

No.  2  would  be  entitled  to  withdraw the  deposited  amount  of

Rs.87 lakhs along with interest accrued thereon and, in addition,

the appellants would also pay a further sum of Rs.5 lakhs.  It was

also agreed that both the parties would approach the High Court

invoking its inherent jurisdiction for quashing the FIR lodged by

respondent  No.2  against  the  appellants.   To  this  end,  the

appellants as well  as respondent No. 2 filed the petition under

Section  482  of  the  Code  of  Criminal  Procedure  (Cr.P.C.)  for

quashing of FIR.  However, it has been dismissed by the High

Court primarily on the ground that the affidavit which was filed by

respondent No. 2 before the High Court was defective and further

that respondent No. 2/complainant was not in a position to give

answers consistent with the settlement.  The High Court has also

observed that  since allegations against  the appellants are that

they have connived and together cheated the complainant, it is

not a fit case for quashing the FIR.

6) Insofar  as  first  reason  given  by  the  High  Court  is  concerned,

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learned  counsel  appearing  for  respondent  No.  2  made  a

categorical statement before us on instructions from respondent

No. 2 that he has, in fact, settled the matter on terms which are

being taken note of above.  He has further stated that respondent

No.  2  has  no  objection  if  the  proceedings  arising  out  of  the

aforesaid FIR are quashed.  We find that the matter is settled by

the complainant out of his free will.   

7) In a case like this, where the proceedings are still at initial and

nascent  stage,  the  High  Court  should  have  exercised  its

discretion in quashing the proceedings.  Law in this behalf is well

settled by catena of judgments of this Court including Parbatbhai

Aahir  & Ors.  v.  State of  Gujarat  & Anr.1 and  Gian Singh  v.

State  of  Punjab  &  Anr.2.   We may  also  quote  the  following

passage from the case of  Narinder Singh & Ors.  v.  State of

Punjab & Anr.3:

“29. In view of the aforesaid discussion, we sum up and lay down the following principles by which the High  Court  would  be  guided  in  giving  adequate treatment to the settlement between the parties and exercising its power under Section 482 of the Code while  accepting  the  settlement  and  quashing  the proceedings or refusing to accept the settlement with direction to continue with the criminal proceedings:

29.1. Power conferred under Section 482 of the Code is to be distinguished from the power which lies in

1  (2017) 9 SCC 641 2  (2012) 10 SCC 303 3  (2014) 6 SCC 466

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the Court to compound the offences under Section 320 of the Code. No doubt, under Section 482 of the Code, the High Court has inherent power to quash the criminal proceedings even in those cases which are  not  compoundable,  where  the  parties  have settled  the  matter  between  themselves.  However, this  power  is  to  be  exercised  sparingly  and  with caution.

29.2. When the parties have reached the settlement and on that basis petition for quashing the criminal proceedings is filed, the guiding factor in such cases would be to secure: (i) ends of justice, or (ii) to prevent abuse of the process of any court. While exercising the power the High Court is to form an opinion on either of the aforesaid two objectives.

29.3. Such a power is not to be exercised in those prosecutions  which  involve  heinous  and  serious offences of mental depravity or offences like murder, rape, dacoity, etc.  Such offences are not private in nature  and  have  a  serious  impact  on  society. Similarly,  for  the  offences  alleged  to  have  been committed under special statute like the Prevention of Corruption Act or the offences committed by public servants while working in that capacity are not to be quashed  merely  on  the  basis  of  compromise between the victim and the offender.

29.4. On the other hand, those criminal cases having overwhelmingly  and  predominantly  civil  character, particularly  those  arising  out  of  commercial transactions or arising out of matrimonial relationship or  family  disputes  should  be  quashed  when  the parties  have  resolved  their  entire  disputes  among themselves.

29.5. While exercising its powers, the High Court is to examine as to whether the possibility of conviction is remote and bleak and continuation of criminal cases would  put  the  accused  to  great  oppression  and prejudice and extreme injustice would be caused to him by not quashing the criminal cases.

29.6. Offences under Section 307 IPC would fall  in

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the  category  of  heinous  and  serious  offences  and therefore are to be generally treated as crime against the  society  and  not  against  the  individual  alone. However, the High Court would not rest its decision merely because there is a mention of  Section 307 IPC in the FIR or  the charge is framed under this provision.  It  would  be  open  to  the  High  Court  to examine as to whether incorporation of Section 307 IPC is there for the sake of it or the prosecution has collected sufficient evidence, which if proved, would lead to proving the charge under Section 307 IPC. For this purpose, it would be open to the High Court to go by the nature of injury sustained, whether such injury  is  inflicted  on  the  vital/delegate  parts  of  the body, nature of weapons used, etc. Medical report in respect  of  injuries  suffered  by  the  victim  can generally be the guiding factor. On the basis of this prima facie analysis, the High Court can examine as to whether there is a strong possibility of conviction or the chances of conviction are remote and bleak. In the former case it can refuse to accept the settlement and quash the criminal proceedings whereas in the latter case it would be permissible for the High Court to accept the plea compounding the offence based on complete settlement between the parties. At this stage, the Court can also be swayed by the fact that the settlement between the parties is going to result in harmony between them which may improve their future relationship.

29.7. While  deciding  whether  to  exercise  its  power under  Section  482  of  the  Code  or  not,  timings  of settlement play a crucial role. Those cases where the settlement is arrived at immediately after the alleged commission of offence and the matter is still  under investigation,  the  High  Court  may  be  liberal  in accepting  the  settlement  to  quash  the  criminal proceedings/investigation. It is because of the reason that at this stage the investigation is still on and even the charge-sheet has not been filed. Likewise, those cases where the charge is framed but the evidence is yet to start or the evidence is still at infancy stage, the High Court can show benevolence in exercising its  powers  favourably,  but  after  prima  facie assessment of the circumstances/material mentioned above.  On  the  other  hand,  where  the  prosecution evidence is almost complete or after the conclusion

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of  the  evidence  the  matter  is  at  the  stage  of argument,  normally  the  High  Court  should  refrain from exercising its power under Section 482 of the Code, as in such cases the trial court would be in a position to decide the case finally on merits and to come  to  a  conclusion  as  to  whether  the  offence under Section 307 IPC is committed or not. Similarly, in  those  cases  where  the  conviction  is  already recorded by the trial  court and the matter is at the appellate  stage  before  the  High  Court,  mere compromise  between  the  parties  would  not  be  a ground to accept the same resulting in acquittal  of the offender who has already been convicted by the trial court. Here charge is proved under Section 307 IPC and conviction is already recorded of a heinous crime and, therefore, there is no question of sparing a convict found guilty of such a crime.”

 8) As a result, this appeal succeeds and is allowed and proceedings

arising out  of  FIR bearing Crime No. 267 of  2012 lodged with

Chatushrungi  Police  Station,  Pune,  Maharashtra  are  hereby

quashed.   

.............................................J. (A.K. SIKRI)

.............................................J. (ASHOK BHUSHAN)

NEW DELHI; JANUARY 19, 2018.

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