1. The judgment of the Supreme Court in the case of Sai Kamal Shivaji Pokarnekar Vs State of Maharashtra in Crl.A.255/2019 (DD 12.02.2019) is likely to open floodgates for frivolous complaints which arise out of disputes purely of civil nature.
2. It is true that a wrong may give rise to both civil and criminal liability and in such a case where offence under the penal law is clearly made out, a court cannot threw out a complaint merely on the ground that remedy by way of civil suit is available. However, experience has shown that recently with the expansion of commercial activities, large number of criminal complaints are filed regarding disputes purely or predominantly of civil nature by camouflaging the same as criminal offence by clever drafting by legally trained persons.
3. Above decision of the Supreme Court has stated propositions of law so broadly that the courts may be compelled to entertain a complaint purely of civil nature, as the same has been drafted cleverly including therein all the ingredients of the alleged offence. The Supreme Court has laid down the following direction:
“If the ingredients of the offence alleged against the accused are made out in the complaint the criminal proceedings shall not be interdicted ” (emphasis supplied)
4. A complaint of the type referred to above are mostly in commercial transactions where business houses file such complaints which are drafted not by the laymen but by advocates or legally trained persons. One cannot expect such complaints authored by people with legal background not to contain all the ingredients of the offence alleged. The Supreme Court did not even say that the court should be guided by the substance of the matter rather than by its form.
5. If the above dicta of the Supreme Court is taken literally even a computer can successfully perform the functions of magistrate. The computer can tell you whether the complaint contains allegations which constitute ingredients of the offence or not and accordingly pass orders. As early as in the year 1969, the Supreme Court while dealing with judicial function of a Judge in appreciating the material on record observed as follows:
“Judges are not computers. They must call in aid their knowledge of Worldly affairs in appreciating evidence”. (1969 SCR (1) 412 Chaturbhuj Panda & others Vs. The Collector).
6. Again in the case of Niranjan Singh (AIR 1990 SC 1962 para 7), the Supreme Court observed that even at the initial stage one “need not consider everything that prosecution says as gospel truth even if it is contrary to common sense and broad probabilities of the case”.
7. By the present judgment the discretion of the magistrate is confined to only reading of the complaint and nothing else, not even referring to the documents produced with it to determine if the dispute is of civil nature or not. Observation of the Supreme Court that “correctness or otherwise of the allegations has to be decided only in the trial” further puts embargo on the power of the court to treat the case as a civil dispute at any stage earlier than conclusion of the trial.
8. The Supreme Court appears to have given undue importance to the wordings of the complaint rather than the substance of the dispute which has to be ascertained from all circumstances available on record.
9. A 3 Judge Bench of the Supreme Court in the case of Madhava Rao Scindia (AIR 1988 S.C. 709) observed as follows:
“A case of breach of trust is both a civil wrong and a criminal offence. There would be certain situations where it would be a civil wrong and may or may not amount to criminal offence”.
10. Again in Parbathbai Aahir’s case 2017 (9) SCC 641, the Supreme Court held as follows:
“16.7. As distinguished from serious offences there may be criminal cases which have an overwhelming or predominant element of a civil dispute. They stand on a distinct footing in so far as exercise of inherent power to quash is concerned”.
11. The present decision of the Supreme Court does not refer to above earlier rulings and primarily or exclusively give importance to the wordings in the complaint and virtually directs exclusion of all other material. Thus indirectly it lays emphasis on the capacity of the author to draft the complaint mentioning the Ingredients of the offence. If that is successfully done, then the accused is bound to face harassment till the conclusion of the trial, as according to the Supreme Court the decision on the question could be only after trial.
12. It is a matter of common knowledge that with the increase in the volume of commercial transactions, courts are over burdened with cases involving such complaints. Such entities make all attempts to get their claims settled early. It is well known that civil cases takes years to attain finality. Therefore, in most cases, business entities try to initiate criminal actions so as to secure early settlement of their disputes. To achieve this end, services of police are utilized by adopting questionable means and the power of police is abused to compel parties to settle the disputes on threat of criminal action including arrest. Many a times to shield themselves against criticism of registering FIRs in civil disputes, on the advise of police, private complaints are filed before the Magistrates and routine orders under section 156 (3) of Cr.P.C are secured for ordering registration of FIR and investigation. These developments lead to enormous pressure on criminal courts and police whose time is wasted in such frivolous cases purely of civil nature, thereby ignoring genuine cases involving serious offences.
13. The Supreme Court and the High Courts must bear above practical aspects in mind while laying down law on the question of taking cognizance of alleged offences which are purely or predominantly of civil nature.
14. According to Article 141 of the Constitution, law declared by the Supreme Court is binding on everyone including all courts and tribunals. Of course, in many cases the Supreme Court has clarified that “it is not every observation or opinion expressed by the Supreme Court is law of the land”. It is only the ratio decidendi which is binding. However, in practice, no judge or Magistrate can afford to ignore even a stray sentence in the judgment of the Supreme Court on the ground that it is not ratio but only obiter. It is therefore, imperative that Supreme Court should be careful in making observations on legal aspects which, if followed in the context of different fact situation, might result in miscarriage of justice.
15. It is therefore, suggested that it is expedient and in the interest of justice that the superior courts rest their judgments on the facts of the case rather than lay out broad propositions of law in general terms. Even where such proposition of law is laid down, it would be advisable to use expressions such as “ordinarily” or “normally” so that in a given case courts are empowered to carve out an exception to render justice. It is also advisable for superior courts to make it clear that only in exceptional circumstances; the normal rule could be relaxed.
16. In many cases of breach of contract, which enables only civil remedy, an attempt is made to give it colour of criminality by making out of a case of cheating. The dividing line between the two is rather thin. While mere breach of contract can never be cheating, if at the time of promise itself, the party had intention to deceive, a case of cheating is made out. According to the above decision of the Supreme Court, if the complaint contains an allegation that at the time of promise itself the opponent entertained an intention to cheat, (though not supported by circumstance) then the courts cannot terminate the proceedings till the trial is over. It is hoped that the Supreme Court will very soon clarify its above decision to enable quashing of cases involving civil dispute.
17. The power of courts to terminate frivolous proceedings at initial stages such as taking cognizance or discharge or even quashing under section 482 Cr.P.C should not be unduly curtailed by using such expressions as “rarest of rare cases” etc., without leaving the decision to the sound judicial discretion of the High Courts. This will enable criminal courts to usefully utilize their time and energy to dispose of genuine criminal cases involving serious crimes rather waste their time on luxury litigation involving purely civil disputes.
Mr. B.V. Acharya, Senior Advocate and former Advocate General for Karnataka.
Daksha Legal 