Supreme Court Quashes Criminal Proceedings in Property Dispute: Govind Prasad Kejriwal vs. State of Bihar (2020)

Date of the Judgment: 31 January 2020

Citation: (2020) INSC 74

Judges: Ashok Bhushan, J., M. R. Shah, J.

Can a dispute over property and partnership matters lead to criminal charges? The Supreme Court of India recently addressed this question, examining whether a criminal complaint was a valid response to a civil dispute. The Court ultimately quashed the criminal proceedings, finding them to be an abuse of process. This judgment highlights the importance of distinguishing between civil and criminal matters. The bench comprised of Justice Ashok Bhushan and Justice M. R. Shah, who delivered the judgment.

Case Background

The case revolves around a dispute involving a partnership firm called Kejriwal Films. The complainant, Gopal Prasad, brother of Ramesh Kumar (a partner in the firm), filed a criminal complaint against Govind Prasad Kejriwal, another partner, and his father, Balabhadra Prasad Kejriwal. The complaint alleged that the accused had broken the locks of a cinema hall owned by the firm, removed documents and equipment, and assaulted the complainant when he objected. The complainant claimed that the accused surrendered the cinema license to cause loss to the complainant’s brother and his partner, Satyanarayan. The complaint also stated that the complainant’s brother had suffered a loss of Rs. 50,000 due to the theft of the properties of the firm. The complainant also alleged that the police did not lodge his report and colluded with the accused. The accused also lodged a complaint against the complainant and others for theft of a generator set from the premises of the cinema hall. A charge sheet was filed against the complainant and others. A title suit was also filed by Ramesh Kumar against the partnership firm and its partners, which was later withdrawn.

Timeline

Course of Proceedings

The initial criminal complaint filed by Gopal Prasad was dismissed by the Judicial Magistrate. However, the Additional Sessions Judge, Barh, allowed a revision application and remanded the case back to the Magistrate for further inquiry. Following the remand, the Magistrate took cognizance of the offenses under Sections 323, 341, and 379 of the Indian Penal Code (IPC). The High Court declined to interfere with the cognizance order, but allowed the appellant to move the lower court. The appellant then filed an application for discharge, which was rejected by the Magistrate. The High Court dismissed the subsequent application to quash the proceedings. The Supreme Court heard the appeal against the High Court’s decision.

Legal Framework

The case primarily involves the following sections of the Indian Penal Code, 1860 (IPC):

• Section 323, IPC:

  This section deals with the punishment for voluntarily causing hurt. It states,
  “Whoever, except in the case provided by section 334, voluntarily causes hurt, shall be punished with imprisonment of either description for a term which may extend to one year, or with fine which may extend to one thousand rupees, or with both.”

• Section 341, IPC:

  This section defines the punishment for wrongful restraint. It states,
  “Whoever voluntarily obstructs any person so as to prevent that person from proceeding in any direction in which that person has a right to proceed, is said wrongfully to restrain that person.”

• Section 379, IPC:

  This section defines the punishment for theft. It states,
  “Whoever commits theft shall be punished with imprisonment of either description for a term which may extend to three years, or with fine, or with both.”

Arguments

Appellant’s Arguments:

• The High Court erred in dismissing the application and confirming the Trial Court’s order rejecting the discharge application.
• The allegations in the complaint, even if taken at face value, do not constitute any offense under Sections 323, 341, and 379 of the IPC.
• The complainant is trying to convert a civil dispute into a criminal one, which is an abuse of the process of law.
• The High Court failed to exercise its jurisdiction in quashing the proceedings.

Respondent’s Arguments:

• The Trial Court rightly took cognizance of the offenses after conducting an inquiry under Section 202 of the Code of Criminal Procedure (Cr.P.C.).
• The High Court was correct in not interfering with the Trial Court’s order.
• At the stage of inquiry and cognizance, the Trial Court only needs to satisfy itself that there is a prima facie case. Reliance was placed on National Bank of Oman vs. Barakara Abdul Aziz, (2013) 2 SCC 488 (Supreme Court of India).
• The allegations in the complaint make out a case for the offense under Section 323 of the IPC.
• The submissions made by the accused are defenses that should be considered during trial.

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame issues in a separate section. However, the core issue that the Court addressed was:

1. Whether the criminal proceedings initiated against the accused were an abuse of the process of law, given the nature of the dispute.

Treatment of the Issue by the Court

Authorities

The following authorities were considered by the Court:

Judgment

How each submission made by the Parties was treated by the Court?

How each authority was viewed by the Court?

• The case of National Bank of Oman vs. Barakara Abdul Aziz, (2013) 2 SCC 488 (Supreme Court of India) was distinguished. While the court agreed that a broad view and a prima facie case is to be considered during inquiry under Section 202 Cr.P.C., it held that the Magistrate must also consider whether the proceedings are an abuse of the process of law and whether the dispute is primarily civil.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the following:

• The dispute was essentially civil in nature, arising from a partnership firm and property issues.
• The criminal complaint was filed by the brother of a partner, not a partner himself, indicating a lack of direct involvement in the firm’s affairs.
• The allegations in the complaint did not satisfy the ingredients for offenses under Sections 341 and 379 of the IPC.
• Even the ingredients of Section 323 of the IPC were not satisfied.
• Prior civil litigation and a criminal complaint by the appellant against the complainant and others further highlighted the civil nature of the dispute.

Fact:Law Ratio Analysis: The court’s decision was influenced more by legal considerations (70%) than by the factual aspects of the case (30%). The court focused on whether the legal ingredients of the alleged offenses were met and whether the proceedings were an abuse of the process of law.

Logical Reasoning

Key Takeaways

• Criminal proceedings should not be used to settle civil disputes.
• Courts must carefully examine the nature of the allegations to determine if a criminal offense is made out.
• A Magistrate, while taking cognizance, must also consider if the proceedings are an abuse of the process of law.
• The court held that the ingredients of Sections 341, 379 and 323 of the IPC were not satisfied.
• The Supreme Court can exercise its powers under Article 136 of the Constitution to quash criminal proceedings that are an abuse of the process of law.

Directions

The Supreme Court did not issue any specific directions other than quashing the criminal proceedings.

Development of Law

The ratio decidendi of this case is that criminal proceedings should not be initiated or continued when the dispute is primarily civil in nature and the allegations do not satisfy the ingredients of the alleged offenses. This case reinforces the principle that criminal law should not be used as a tool to settle civil disputes and that courts must be vigilant in preventing the abuse of the process of law.

Conclusion

The Supreme Court quashed the criminal proceedings against the appellant, Govind Prasad Kejriwal, holding that the dispute was civil in nature and the criminal complaint was an abuse of the process of law. The Court emphasized that criminal law should not be used to resolve civil disputes and that courts must carefully examine the substance of the allegations before initiating criminal proceedings. This judgment reinforces the distinction between civil and criminal matters and protects individuals from being subjected to unwarranted criminal prosecution arising out of civil disputes.