Karnataka HC Quashes Cheating Case Against Scania Vehicles, Calls It Travel Agency's Arm Twisting Tactic To Settle Its Dues

The Karnataka High Court earlier this month quashed a criminal case filed against commercial vehicles manufacturer Scania India, its Directors and Managers, alleging criminal breach of trust and cheating in sale of around 70 buses.The complaint was lodged by the proprietor of SRS Travels, a Bengaluru based travel agency. He claimed that the company sold him defective buses and he was saddled with numerous problems in the operation and maintenance of vehicles which led to huge financial losses.Following an earlier order, the High court had allowed the legal heir (daughter) of the complainant to continue the criminal case following complainant's demise.However, while finally disposing of the matter, the single bench of Justice M Nagaprasanna found the case to be nothing but an arm-twisting tactic of the "disgruntled" complainant to settle his dues towards repair charges."The offence of criminal breach of trust or cheating cannot even remotely be found in the complaint which alleges that a commercial transaction has gone wrong between the Company and the complainant. The transaction has gone wrong not because of the acts of the Company, but due to the complainant failing to pay the amount either to the Company or to the Financier."The subject vehicles were purchased throughout the period between 2013 and 2018. The contract provided three years warranty excluding wear and tear of components The complaint was filed only in the year 2020. Meanwhile, the complainant came to owe over Rs. 90 lakh to the Company for repair works of a few buses. In light of these circumstances, the High Court held that ingredients of both Sections 406 (Criminal Breach of Trust) and 420 (Cheating) of the IPC were conspicuously absent in the case. It observed that purchase of buses was between 2014 and 2018, they were plied on roads and later generated defects which cannot but be held to be "wear and tear".It observed,"For an offence punishable under Section 406 of the IPC, the essential ingredients as found in Section 405 of the iPC, which are that the accused must be entrusted with the property or with dominion over it; the person so entrusted must use that property or; the accused must dishonestly use or dispose of that property or willfully make other person suffer by such violation of any direction of law prescribing the mode in which such trust is to be discharged; which should necessarily contain an ingredient of any legal contract made touching the discharge of such trust. The ingredients of cheating would require deception by fraudulently or dishonestly inducing that person i.e., the alleged fact to deliver any property to any person and intentionally inducing that person to do or omit to do anything. Therefore, a fraudulent or dishonest inducement is an essential ingredient of the offence. A person who dishonestly induces another person to deliver any property is liable for cheating...notwithstanding the fact that the proceeding is still at the stage of registration of crime, I deem it appropriate to obliterate the same as ingredients of both Sections 406 and 420 of the IPC are conspicuously absent in the case at hand, even on a deeper scrutiny of the complaint."Case Title: SCANIA COMMERCIAL VEHICLES INDIA PVT. LTD & Others v. STATE OF KARNATAKA & ANRCase No: CRIMINAL PETITION No.2778 OF 2020Citation: 2022 LiveLaw (Kar) 478 Date of Order: 09TH DAY OF NOVEMBER, 2022 Appearance: C.V.NAGESH, SR.ADVOCATE A/W SHWETHA RAVISHANKAR, ADVOCATE for petitioners; K.P.YASHODHA, HCGP FOR R1; SANDESH J.CHOUTA, SR.ADVOCATE FOR ISMAIL M.MUSBA, ADVOCATE FOR R2. Click Here To Read/Download Order

Karnataka HC Quashes Cheating Case Against Scania Vehicles, Calls It Travel Agency's Arm Twisting Tactic To Settle Its Dues

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