A penalty of Rs 25 lakhs has been imposed on the complainant for employing ‘unscrupulous litigation tactics’: Supreme Court
Case Title: Dinesh Gupta v. State Of Uttar Pradesh & Anr.
Case No: S.L.P.(Crl.) No.3343 of 2022
Decided on: 11th January, 2024
CORAM: THE HON’BLE MR. JUSTICE VIKRAM NATH AND HON’BLE MR. JUSTICE RAJESH BINDAL
Facts of the Case
In the current scenario, the respondent lodged an FIR against, among others, the promoters of three companies, alleging forgery and cheating. According to the complainant, their company was persuaded to provide short-term loans to the accused companies. The Chief Judicial Magistrate of Gautam Budh Nagar issued the summons. Disputing this, the accused individuals/appellants sought relief from the High Court, which, upon dismissal, led to the filing of the current appeal.
Issue
The central issue in this case involves the appeal against the summoning order issued by the Chief Judicial Magistrate in response to an FIR filed by the respondent, alleging forgery and cheating in connection with short-term loans extended to the accused companies.
Legal Provision
As per the Section 463 of the Indian Penal Code, 1860: Whoever makes any false document or false electronic record or part of a document or electronic record, with intent to cause damage or injury, to the public or to any person, or to support any claim or title, or to cause any person to part with property, or to enter into any express or implied contract, or with intent to commit fraud or that fraud may be committed, commits forgery.
Section 415 of the Indian Penal Code, 1860 states that whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property, to any person, or to consent that any person shall retain any property, or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, mind, reputation or property, is said to “cheat”.
Court’s analysis and decision
The Supreme Court strongly criticized a litigant for abusing the legal system by filing a false and frivolous complaint without disclosing essential facts. The Court rebuked the respondent for engaging in forum shopping and filing an FIR against the appellants despite the commercial nature of the dispute. Justices Vikram Nath and Rajesh Bindal, constituting a Division Bench, imposed a cost of ₹25 lakhs on the respondent, condemning such abuse of power.
The Court, expressing disdain for unscrupulous litigants, emphasized the need to prevent them from evading accountability. Addressing the issue of false jurisdiction, the Supreme Court pointed out that the FIR was registered in Noida, while the registered offices of the involved companies were in Delhi. The Court characterized this as a manipulative form of forum shopping, raising serious doubts about the complainant’s credibility.
The Court criticized the Trial Court’s order, stating that it lacked thoughtful consideration while taking cognizance and issuing summons to the accused. It noted the complainant’s concealment of material facts and the fabrication of a false narrative of document forgery, attributing it to a criminal act. The Court recorded its disapproval, stating that the respondent had opted for criminal charges with a motive for personal vengeance rather than seeking genuine justice.
The Court highlighted the conversion of a civil matter into a criminal case, stressing that it not only burdens the criminal justice system but also violates principles of fairness and proper legal conduct. The Court expressed concern about the damage to trust in the legal system and the potential harmful precedent set by such misuse of criminal proceedings.
Additionally, the Court noted that a short-term loan given in 2010 remained unaddressed until the filing of the FIR after 8 years and 7 months. It opined that these circumstances revealed the malicious intentions of the complainant, deliberately causing substantial delay for opportune moments to initiate baseless litigation.
Concluding that it was a clear case of malicious prosecution, the Court dismissed the FIR against the appellants.
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Written by- Afshan Ahmad