Criminal Courts Are Not Meant To Use For Settling The Scores: Jharkhand HC Quashes Criminal Proceedings Against Director Prakash Jha
The Jharkhand High Court, while quashing criminal proceedings against Director Prakash Jha, held that merely an allegation of failure to keep a promise is not enough to initiate criminal proceedings in a breach of agreement case.
The complainant, an authorized agent of Classic Multiplex Private Limited (Company), had entered into a written agreement with the accused Director/Producer Prakash Jha on behalf of Chairman-cum-Managing Director of the Company.
As per the agreement, the director had promised the company some area of his land for the construction of a multiplex. The complainant had also deposited bank drafts to the director for the booking of the said land. However, the director kept the money and did not make any bookings.
A Single Bench of Justice Sanjay Kumar Dwivedi observed, “It is well settled that a breach of contract does give rise to criminal prosecution for cheating unless the fraudulent and dishonest intention is there in the beginning of the transaction. Merely on the allegation of failure to keep premises will not be enough to initiate criminal proceeding…Criminal Courts are not meant to use for settling the scores or pressurize the parties to settle the dispute.”
Sr. Advocate Umesh Prasad Singh represented the petitioners, while Spl. P.P. Prabhu Dayal Agrawal appeared for the opposite parties.
The Court stated that the bank drafts were not encashed by the director and if encashment was not there, then Section 25 of the Contract Act can be attracted. Section 25 of the Contract Act states that in the absence of any consideration, a contract is deemed to be a void contract.
The Court explained that in light of the definition of Section 415 I.P.C., to hold a person guilty of cheating, it is necessary to show fraudulent and dishonest intention at the time of making a promise.
The Court remarked that the director had no intention of cheating as he did not encash the drafts in question suggesting that intention was a paramount consideration under Section 415 I.P.C.
The Court held that “if criminal proceeding is allowed to be continue against the petitioners before the learned court will amount the abuse of process of law.”
Accordingly, the High Court quashed the criminal proceedings and allowed the petition.
Cause Title: Prakash Jha & Ors. v. The State of Jharkhand & Anr.
Appearance:
Petitioners: Sr. Advocate Umesh Prasad Singh, and Advocates Jitendra S. Singh and Surbhi
Opposite Parties: Spl. P.P. Prabhu Dayal Agrawal