Dispute as Commercial with No Element of Criminality: Supreme Court Quashes Criminal Complaint

The Bench, comprising Justices Aniruddha Bose and Sanjay Kumar, observed, “A commercial dispute, which ought to have been resolved through the forum of Civil Court has been given criminal colour by lifting from the penal code certain words or phrases and implanting them in a criminal complaint.” This observation came as the apex court examined the case involving allegations of criminal breach of trust, intimidation, and abuse in a dispute over payment for a supply of Dissolved Acetylene Gas (DA Gas).

The appellant, Sachin Garg, was accused by the respondent, a proprietor of Ambika Gases, of nonpayment for DA Gas supplied for manufacturing batteries in Exide Industries Limited’s factory. The dispute originated from amendments made to the original purchase order and the subsequent invoice raised by the respondent.

In its judgment, the Supreme Court meticulously analyzed the principles for quashing proceedings under Sections 405 and 406 of the IPC. The Court noted, “We do not find any material to come to a prima facie finding that there was dishonest misappropriation or conversion of any material for the personal use of the appellant in relation to gas supplying work done by the respondent no.2.”

Addressing the allegations of criminal intimidation, the Court found them insufficiently substantiated, considering them a mere commercial disagreement. “This would constitute a mere bald allegation, short of any particulars as regards to the manner in which threat was conveyed,” the Bench stated.

 Date of Decision: 30th January 2024

SACHIN GARG VS STATE OF U.P & ANR.