The Jharkhand High Court has quashed the criminal proceedings against an official of E-Kart Logistics and a member of the Flipkart security team in a case concerning allegations that shipments belonging to a company were not returned. The Court held that the allegations, even if accepted in their entirety, did not constitute the offences of criminal breach of trust under Section 406 of the Indian Penal Code or cheating under Section 420 IPC against the individual employees. The Court found that the alleged entrustment of the shipments was to Flipkart as a company and not to the two petitioners personally. The Court therefore concluded that continuation of the criminal proceedings against the petitioners would amount to an abuse of the process of law.
The order was passed by a Single Judge Bench of Justice Anil Kumar Choudhary while considering petitions filed under Section 482 of the Code of Criminal Procedure. Through the petitions, the accused employees sought quashing of the FIR, the criminal proceedings and the order by which the Magistrate had taken cognizance of offences punishable under Sections 406 and 420 IPC. The proceedings arose from a complaint filed by a company that was selling products through the Flipkart platform and had been conducting business through the platform for several years.
The dispute originated from allegations concerning several shipments belonging to the complainant company. According to the complaint, the shipments had been sent through E-Kart Logistics but were allegedly not returned to the complainant. The complainant alleged that Flipkart provided digital copies of proof of delivery for the shipments but did not produce the physical proof of delivery. The allegations subsequently involved employees associated with E-Kart Logistics and Flipkart, including the two petitioners who approached the High Court seeking termination of the criminal proceedings against them.
According to the allegations, an official of E-Kart Logistics had contacted employees of the complainant company concerning the missing materials. The petitioners were alleged to have visited the complainant's office at Kusai, Doranda, where discussions took place concerning the digital proof of delivery. The complaint alleged that the petitioners threatened and abused the complainant and his employees during the interaction. A member of the Flipkart security team was also alleged to have behaved rudely with the complainant's staff. These allegations formed part of the complaint on the basis of which criminal proceedings were subsequently initiated.
The complainant alleged that 19 shipments had not been received by its officials. The value of these shipments was stated to be ₹1,06,720. It was further alleged that the 19 shipments had been settled for a lower amount of ₹56,649.70. According to the complainant, this resulted in a total alleged loss of ₹1,63,369. The allegations concerning the shipments and the resulting loss ultimately led the complainant to initiate criminal proceedings against the concerned persons.
The complainant initially approached the Court of the Sub-Divisional Judicial Magistrate at Ranchi by filing a complaint case. The complaint was thereafter referred to the police for investigation. Following the reference, Doranda Police Station registered a criminal case and commenced an investigation into the allegations. The investigation concerned the alleged non-return of shipments and the conduct attributed to the petitioners in connection with the dispute between the complainant company and the Flipkart-related entities.
After completing the investigation, the police submitted a chargesheet against the two petitioners for offences under Sections 406 and 420 IPC. The Judicial Magistrate-XIII, Ranchi subsequently took cognizance of the alleged offences. The petitioners then approached the Jharkhand High Court under Section 482 of the Code of Criminal Procedure and sought quashing of the criminal proceedings, including the FIR and the order taking cognizance.
Before the High Court, the petitioners argued that even if the allegations contained in the complaint, the statement of the complainant and the statements of witnesses examined during the inquiry were accepted completely, the basic ingredients required to establish offences under Sections 406 and 420 IPC were absent. Their principal argument was that the alleged entrustment of the shipments was part of the commercial arrangement between the complainant company and Flipkart and that the individual petitioners had not personally received or been entrusted with the property in question.
The petitioners submitted that they were merely employees associated with the companies involved and that there was no allegation showing that the complainant had entrusted the shipments to them individually. The distinction between the corporate entity and its employees formed the central issue considered by the High Court while examining the offence of criminal breach of trust. The Court therefore examined whether the allegations disclosed the necessary element of entrustment against the individual petitioners.
While considering Section 406 IPC, the High Court examined the requirement of entrustment of property. Criminal breach of trust requires that property be entrusted to the accused and that the accused thereafter deal with that property in a manner attracting criminal liability. In the case before the Court, however, there was no allegation that the property involved in the shipments had been entrusted personally to either of the petitioners. The Court found that the main allegation concerning entrustment was directed against Flipkart as a company.
The Court observed that there was no allegation that the petitioners had been involved in the arrangement entered into between the complainant company and Flipkart at the time the commercial relationship was established. According to the Court's assessment, the alleged entrustment was to Flipkart and not to the two individuals against whom the criminal proceedings had been instituted. The absence of personal entrustment was therefore considered material to determining whether the ingredients of Section 406 IPC were satisfied.
The High Court concluded that there was no entrustment of property to the petitioners. At the highest, according to the Court's findings, the alleged entrustment was to Flipkart. Since the essential element of entrustment was absent against the individual accused, the Court held that the offence of criminal breach of trust under Section 406 IPC could not be established against them on the allegations contained in the case.
The Court then considered the allegation of cheating under Section 420 IPC. For this offence, the allegations would have to disclose deception by the accused and dishonest or fraudulent inducement resulting in the complainant delivering property or taking a particular course of action. The High Court examined the complaint and accompanying material to determine whether any such conduct had been attributed to the two petitioners.
The Court found that there was no allegation that either petitioner had deceived the complainant by making a false or misleading representation. There was also no allegation that either petitioner had dishonestly concealed a fact or omission in a manner that induced the complainant to part with property. The material before the Court therefore did not disclose the necessary elements of deception or dishonest inducement against the petitioners.
The High Court further found that there was no allegation that the petitioners had induced the complainant or its company to deliver any property to them. The Court noted that there was no allegation that the complainant had parted with property because of any inducement made by either petitioner. In the absence of these essential elements, the Court held that the allegations could not constitute the offence of cheating under Section 420 IPC.
The Court's assessment was therefore that neither of the two offences invoked against the petitioners was made out from the allegations. The alleged failure to return shipments, by itself, did not establish criminal breach of trust by the individual employees because the alleged entrustment was not to them personally. Similarly, the allegations did not establish cheating because there was no material showing deception or dishonest inducement by the petitioners resulting in delivery of property.
The High Court consequently exercised its jurisdiction under Section 482 of the Code of Criminal Procedure. The Court held that allowing the criminal proceedings to continue against the petitioners, when the essential ingredients of Sections 406 and 420 IPC were absent, would amount to an abuse of the process of law. The Court therefore ordered that the criminal proceedings against the two petitioners be quashed.
The order specifically resulted in the quashing of the criminal proceedings arising from the Doranda Police Station case and the order by which cognizance had been taken by the Judicial Magistrate-XIII, Ranchi. The quashing was confined to the two petitioners before the High Court. The Court's decision was based on its finding that the allegations did not disclose the ingredients of criminal breach of trust or cheating against these individual accused persons.
The case was titled Manish Kumar v. State of Jharkhand and Another. The proceedings included a connected petition arising from the same dispute. The petitioners were represented before the High Court by their advocates, while the State was represented by its Special Public Prosecutor and Additional Public Prosecutor. The complainant, who was arrayed as the second opposite party, was also represented before the Court.
The proceedings demonstrate that the High Court examined the allegations against the individual employees separately from the alleged commercial relationship between the complainant company and Flipkart. The Court focused on whether the shipments had actually been entrusted to the petitioners and whether either petitioner had personally deceived or induced the complainant. After examining the allegations, the Court found that the necessary elements were absent.
The allegations concerning the missing shipments remained the factual foundation of the complaint. The complainant had alleged that 19 shipments had not been received and that the shipments had been settled for a lower amount, causing the alleged loss. The complaint also contained allegations concerning the interaction between the complainant's employees and the petitioners at the complainant's office. However, the High Court found that these allegations did not establish the statutory ingredients of Sections 406 and 420 IPC against the petitioners.
The Court's reasoning regarding criminal breach of trust centred on the absence of personal entrustment. The alleged property had been entrusted, at the highest, to Flipkart, which was a corporate entity. There was no allegation that the individual petitioners had personally received the property pursuant to the commercial arrangement or had been entrusted with it in their individual capacity. Consequently, the essential foundation for Section 406 IPC was missing against them.
With respect to cheating, the Court similarly found no allegation establishing that the petitioners had made a false representation, concealed a material fact or dishonestly induced the complainant to deliver property. The allegations concerning the subsequent handling of shipments and the interaction between the parties could not, in the absence of the necessary elements, establish the offence under Section 420 IPC. The Court therefore held that the prosecution could not continue against the petitioners on these charges.
The High Court's final conclusion was that continuation of the criminal proceedings would amount to an abuse of the process of law. It accordingly quashed the proceedings, the relevant police case and the order taking cognizance insofar as the two petitioners were concerned. The decision was based entirely on the Court's examination of the allegations and the legal ingredients required for the offences invoked against the individual employees.
The Jharkhand High Court therefore brought an end to the criminal case against the E-Kart Logistics official and the Flipkart security team member in relation to the allegations of missing shipments. The Court found that the alleged entrustment was to Flipkart as a company rather than to the individual petitioners and that there was no allegation of deception or dishonest inducement by them. In the absence of the essential ingredients of Sections 406 and 420 IPC, the criminal proceedings against the petitioners were quashed.
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