Holding

The allegations could not be treated as purely personal; the High Court erred in quashing the proceedings under Section 482, and the criminal case must proceed.

Summary

The Supreme Court examined a criminal complaint filed by members of the All Kerala Chemists and Druggists Association alleging that the Association's former President, Secretary and Treasurer misappropriated its funds. After investigation, a charge‑sheet was filed under Sections 406, 408, 409, 477A and 120B IPC. The accused sought quashing of the proceedings under Section 482 of the CrPC, claiming the dispute was purely personal and had been settled through a compounding petition, a view accepted by the Kerala High Court which dismissed the case. The Supreme Court held that the allegations involved misuse of public office and could not be treated as a private matter, and that the High Court had erred in using its inherent power to quash the case. Consequently, the appeal was allowed, the High Court’s order set aside, and the criminal proceedings were restored before the Chief Judicial Magistrate. The Court also directed further investigation into the role of the complainants.

Issues considered

The allegations of misappropriation of Association funds constitute a matter of public interest and not merely a private dispute.
Whether the High Court could quash the criminal proceedings under Section 482 of the CrPC when the offences are non‑compoundable and of a serious nature.
Whether the settlement and compounding petition can override the statutory bar on compounding certain offences.

Legislation cited

Code of Criminal Procedure, 1973s. 320, s. 482
Indian Penal Code, 1860s. 120B, s. 307, s. 406, s. 408, s. 409, s. 477A

Subjects

Criminal Procedure CodeSection 482Quashing of criminal proceedingsMisappropriation of fundsAssociation office bearersNon‑compoundable offencesSettlement and compoundingPublic policyCriminal breach of trust

Judgment

[2016] 3 S.C.R. 103

J. RAMESH KAMATH & ORS. A
v.
MOHANA KURUP & ORS.
(Criminal Appeal No. 445of2016)
MAY04,2016 B

[JAGDISH SINGH KHEHAR AND C. NAGAPPAN, JJ.]
Code of Criminal Procedure, 1973: s.482 - Quashing of
proceedings - Co111plai11t against respondents-office bearers of the
Association that they misappropriated fimds' of the Association and
c
misused their position as office bearers of the Association -
Settlement between the parties - Co111pounding petition in view of
settlement - High Court quashed the criminal proceedings on the
ground that in co111pounding petition, a stand was taken by both
the parties that there was no misappropriation offimds ofAssociation
and the offences were purely personal in nature - Held: The D
allegations levelled against respondents-accused could not be treated
as purely of a personal nature - It is also not possible to
acknowledge the position adopted by the complainants, and the
then members of the Association, that no misappropriation had been
commilted by the accused - Such a statement could not have been
E
made after the investigation had been completed, and charges were
fra111ed, which were pending trial before a court of competent
iurisdiction - The basis on which the impugned order i1•as passed,
was incorrectly determined as of a personal nature - It is not the
case of the accused, that the final report does not colllain adequate
material to substantiate the charges - Impugned order set aside - F
Complaint case restored on the file of Chief Judicial Magistrate.
Al4!wing the appeal, the Court
HELD: 1. The allegations levelled against respondent nos.1
to 3 could not be treated as purely of a personal nature. The
complainants, who are arrayed in the present appeal as G
respondent nos.4 to 7 surprisingly, affirmed (in the compounding
petition) that "no misappropriation of the amounts of the
Association is committed by the petitioners/accused persons".
Strongly, respondent nos.8 and 9 who were the General Secretary
H
103
104 SUPREME COURT REPORTS (2016] 3 S.C.R.

A and the Treasurer respectively of the Association, at the time of
filing of the compounding petition, confirmed the stand adopted
by the complainants, in the compounding petition. It is also not
possible to acknowledge the position adopted by the
complainants, and the then members of the Association, that no
misappropriation had been committed by the accused. Such a
B
statement contd not have been made after the investigation had
been completed, and charges were framed, which were pending
trial before a court of competent jurisdiction. The basis on which
the impugned order was passed, was incorrectly determined as
of a personal nature. Additionally, the accusations were not of a
c nature which can be classified by this Court, as were amenable to
be quashed, under Section 482 of the Criminal Procedure Code.
[Paras 18, 19] [115-A-C]
2. Herein, the investigation has been completed, and the
final report was filed before the Chief Judicial Magistrate,
D Ernakulam, on 22.03.2009. More than 6 years have gone by
since then. It is not the case of the accused, that the final report
does not contain adequate material to substantiate the charges.
Appellant 110.l has been cited as charge witness no.5; appellant
No.2 has been cited as charge witness 110.6; and appellant no. 3
has been cited as charge witness no.18. The impugned order is
E set aside. [Paras 21, 22] [117-C-F]
Nari11der Singh vs. State of Punjab (2014) 6 SCC 466:
2014 (4) SCR 1012 - distinguished.
Case Law Reference
F 2014 (4) SCR 1()12 distinguished Para 20
CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No.
445 of2016.
From the Judgment and Order <lated 22.12.2009 of the High Court
of Kera la at Ernakulam in Crl. MC. No. 4154 of 2009.
G
R. Basant, Sr. Adv., Roy Abraham. Gautam Shivashankar, Ms.
Seema Jain, Himinder Lal, Advs. for the Appellants.
Ms. V. Mohana, Sr. Adv., Sidhartha Dave, Sajith. P, 8. N. Dubey,
Ms. Jemtiben, Hari Kumar V., Kumar Gaurnv, R. Chandrachud, Advs.
for the Respondents.
H
J. RAMESH KAMATH & ORS. v. MOHANA KURUP 105
[JAGDISH SINGH Kl-IEHAR. J.]

The Judgment of the Court was delivered by A
.JAGDISH SINGH KHEHAR, J. I. Leave granted.
2. Respondents nos.4 to 7 herein describing themselves as members
of the All Kerala Chemists and Druggists Association (hereinafter
referred to as 'the Association'), filed a written complaint to the City
Police Commissioner, Ernakulam against respondent nos.1 to 3. B
Respondent No.1 - Mohana Kurup was the President of the Association
during the relevant period from 2004 to 2006 and thereafter from 2006
to 2008. R..:sponclent No.2 - Raveendran was the Secretary of the
Association during the same period, and respondent no.3 - Sayed was
the Treasurer ofthe Association during the relevant period. It was alleged
in the complaint filed by respondent nos.4 to 7, that respondent nos. I to
c
3, in furtherance of a criminal conspiracy, and with common intention,
misappropriated huge amounts offunds of'the Association'. by misusing
their position as oftke bearers of 'the Association'. On the basis of the
complaint preferred by respondent nos.4 to 7, First Information Report
bearing Crime No.675/2008 was registered at Central Police Station, D
Ernakulam.
3. Appellant No.2 in the present appeal --Giri Nair (also claiming to
be an active member of the Association), Iikewise filed a complaint before
the City Police Commissioner, Ernakulam, making similar allegations
against respondent nos. I to 3. E
4. The police filed a final report before the Chief Judicial Magistrate,
Ernakulam, on 22.03 .2009, based on an affirmation during investigation,
for offences under Sections 406, 408, 409, 4 77 A and 1208 of the Indian
Penal Code. Needless to mention, that the aforesaid chargcsheet was
based on the complaint addressed by respondents nos.4 to 7 on F
09.04.2008, and not the complaint made by the appellants before this
Cow1.
5. Dissatisfied with the initiation of action against them, respondent
nos. I to 3 filed Criminal M.C.No.4154 of2009 before the High Cow1 of
Kerala (hereinafter referred to as 'the High Court') under Section 482
G
of the Criminal Procedure Code praying for quashing of the final report
(filed by the police in C .C.No.90 of2009, on the file of the Chief Judicial
Magistrate, Ernakularn arising out of Crime No.675/2008). The case
projected by respondent nos. I to 3 before the High Court was, that the
allegations contained in the complaint dated 09.04.2008 were in the nature
of a private dispute, and was of a purely personal nature, without any H
106 SUPREME COURT REPORTS [2016] 3 S.C.R.

A involvement of public policy, and as such, the matter could be settled
between the parties through an amicable settlement. And that, it had
been so settled.
6. Along with the aforesaid Criminal M.C.No.4154 of 2009,
respondent nos. I to 9 filed a joint petition seeking compounding under
B Section 320 of the Criminal Procedure Code. At this juncture, it would
be relevant to mention, that respondent nos.4 to 7 were the original
complainants on whose complaint, the case came to be registered against
respondent nos. I to 3. Respondent nos.8 and 9 herein, were the General
Secretary and Treasurer of'the Association', at the time when Criminal
M.C.No.4154/2009 was filed.
c
7. According to the assertions made before this Court, the High
Court was informed, that the matter had been settled between the parties,
and that, no useful purpose would be served in continuing the prosecution.
The High Com1, in the above view of the matter, passed the impugned
order dated 22.12.2009, whereby, proceedings in CC No.90/2009, pending
D before the Chief Judicial Magistrate, Ernakulam, were quashed.
Paragraph 2 of the impugned order is extracted herein:-
"2. A compounding petition is filed jointlv bv the petitioners and
respondents 1 to 6 stating that entire disputes were settled with
the petitioners, who were the former office bearers and
E respondents I to 4, the complainants and respondents 5 and 6, the
present office bearers and respondents 1 to 4 admit that there
was no misappropriation of the amounts of AKCDA as alleged
and respondents 5 and 6 agreed the same. In view of the
settlement, it is contended that they may be permitted to compound
F the offences."
(emphasis is ours)
A perusal of paragraph 2 extracted above, reveals, that the
complainants (namely, respondent nos. 4 to 7 herein) and the accused
(namely, respondent nos. I to 3 herein) had admitted, that there was no
G misappropriation of the amounts of the Association, and respondents
nos.8 and 9 herein, who were the General Secretary and Treasurer (were
impleaded in the joint petition as respondent Nos.5 and 6) endorsed the
above position.
8. Paragraph 5 of the impugned order, is also being extracted
H hereunder:
J. RAMESH KAMATH & ORS. v. MOHANA KURUP 107
[JAGDISH SINGH KHEHAR, J.]

"5. Prosecution case as against the petitioners is that they A
committed the offences as against AKCDA and its members.
The allegation is that they opened two separate accounts and
converted the cheques and demand drafts received in the name
of AK CD A to their personal accounts and thereby misappropriated
the amounts. The offences alleged are purely personal in nature
B
as against the Association, represented by respondents 5 and 6.
The case was investigated on the complaint filed by respondents
1 to 4. When compounding petition filed by the petitioners along
with respondents I to 6 establishes that there has been a complete
settlement of the disputes and the offences alleged are purely
personal in nature, as held by the Apex court in Madan Mohan c
Abbot v. State of Punjab (2008 (3) KLT 19) it is not in the interest
of justice to continue the prosecution. In the light of the settlement
and the joint petition filed, even if petitioners are to be tried, there
is no likelihood ofa successful prosecution. In such circumstances,
it is not in the interest ofjustice to continue the prosecution.
D
Petition is allowed. C.C.No.90/2009 on the file of Chief Judicial
Magistrate's Court, Ernakulam is quashed."
(emphasis is ours)
A perusal of paragraph 5 of the impugned order reveals, that the
acknowledged position between the parties (the accused, the E
complainants, and the office bearers of 'the Association') which was
projected before the High Court was, that the offences alleged in the
complaint were purely personal in nature.
9. Premised on the acknowledged admitted position, that there was
no misappropriation, as well as, the fact that the offences alleged in the F
complaint were purely personal in nature, the High Court agreed with
the settlement between the parties, and quashed the proceedings in CC
No.90/2009.
I 0. It is also imperative for us to notice, that in the compounding
petition, which was filed by respondent nos. I to 3 herein (the accused), G
as petitioners imp leaded respondents nos.4 to 7 herein (the complainants),
and respondent nos.8 and 9 (the then General Secretary and Treasurer
of 'the Association') herein. A clear and categorical stance was adopted
in the compounding petition, that there was no misappropriation of the
funds of the Association, and that, not only the complainants, but also
H
108 SUPREME COURT REPORTS [2016] 3 S.C.R.

A respondent nos.8 and 9 herein, namely, the General Secretary and the
Treasurer of the Association, confirmed the above position.
11. The first contention advanced at the hands of the learned counsel
for the appel Iants was, that the respondents-accused have been charged
of offences under Sections 406, 408, 409, 477A and 120B of the Indian
B Penal Code. It was the pointed contention of the learned counsel for the
appellants, that most of the provisions under which the accused-
respondents had been charged, were non-compoundable under Section
320 of the Criminal Procedure Code. And as such, the matter could not
have been compounded.

c 12. Whilst it is not disputed at the hands of the learned counsel for
respondent nos. I and 2, that most of the offences under which the accused
w~re charged are non-compoundable, yet' it was asserted, that the
jurisdiction invoked by the High Court in quashing the criminal
proceedings against respondent nos. I to 3, was not under Section 320 of
the Criminal Procedure Code, but was under Section 482 of the Criminal
D Procedure Code, as interpreted by this Court.
13. Insofar as the decisions of this Court are concerned, reference,
in the first instance, was made to Madan Mohan Abbot v. State of Punjab,
(2008) 4 sec 582, wherefrom, our attention was invited to the following
observations:
E
"5. It is on the basis of this compromise that the application was
filed in the High Court for quashing of proceedings which has
been dismissed by the impugned order. We notice from a reading
of tj1e FIR and the other documents on record that the disRut~
was i;>urelv a i;>crsonal one between two _contesting p_artics_ and
F that it arose out of extensive business dealings betweenJhcm and
that there was absolutely no QUblic QOlicy involved in the nature of
the allegations made against the accused. We are, therefore, of
the opinion that no useful purpose would be served in continuing
with the proceedings in the light of the compromise and also in the
G light of the fact that the complainant has on 11-1-2004, passed
away and the possibility of a conviction being recorded has thus
to be ruled out.
6. yje neJ!.9 to e_nwhask;Q.tlrnti!i<;.J~rh.llm;.<1, .. ,,;i]1lcjhat !Rd ispttt(,!s
whc;rc the gucstion_involvcd is of a .l2~[Jc1:c_'i2!]:1Ll!.aturc,_t[1c
Court should ordinarlb'_acccnt Ul£...\£!J!lLQLtJ1s; __c_omrn:o_nl\sc
H
J. RAMESH KAMATH & ORS. v. MOHANA KURUP 109
[JAGDISH SINGH KHEHAR, J.]

even in criminal proceedings as keeping the matter alive with no A
possibility of a result in favour of the prosecution is a luxury which
the courts, grossly overburdened as they are, cannot afford anc(
that the time so saved can be utilised in deciding more effective
and meaningful litigation. This is a common sense approach to the
·matter based on ground of realities and bereft of the technicalities
B
of the law."
(emphasis is ours)
A perusal of the conclusions extracted above, with a reading of the
FIR and the supporting documents in the above case reveal, that the
dispute was purely of a personal nature, between two contesting parties. c
Further that, the dispute arose out of private business dealings between
two private parties. And furthermore, there was absolutely no public
involvement, in the allegations made against the accused. Based on the
aforesaid considerations, this Court had held, that in disputes where the
question involved was of a purely personal nature, it was appropriate for
Courts to accept the terms of compromise, even in criminal proceedings. D
It was sought to be explained, that in such matters, keeping the matters
alive would not result, in favour of the prosecution. We are of the view,
that the reliance on the above judgment would have been justified, if the
inferences drawn by the High Court were correct, namely, that admittedly
there was no misappropriation of the funds of the Association, and
E
secondly, the offences alleged were purely personal in nature. We shall
examine that, at a later stage.
14. Having placed reliance on the judgment in the Madan Mohan
Abbot case (supra), which was determined by a two-Judge Division
Bench of this Court, learned counsel for respondent nos. I to 3 went on
F
to place reliance on Gian Singh vs. State of Punajb (2012) I 0 SCC 303,
which was decided by a three-Judge Division Bench. Insofar as the
instant judgment is concerned, learned counsel for respondent Nos. I to
3, in the first instance, invited this Court's attention to paragraph 37
thereof, wherein the earlier decision rendered by th is Court in the Madan
Mohan Abbot case, was duly noticed. Thereupon, the Bench recorded G
its conclusion as under:
"59. B.S. Joshi (2003) 4 SCC 675, Nikhil Merchant (2008) 9 SCC
677. Manoi Sharma !1.Q08) 16 SCC 1 and Shi j i (2011) 10 SCC 705
do illustrate the principle that the High Court may quash criminal
proceedings or FIR or complaint in exercise of its inherent power H
110 SUPREME COURT REPORTS [2016] 3 S.C.R.

A under Section 482 of the Code and Section 320 does not limit or
affect the powers of the High court under Section 482. Can it be
said that by quashing criminal proceedings in B. S. Joshi, Nikhil
Merchant, Manoj Sharma and Shiji this Court has compounded
the non-compoundable offences indirectly? We do not think so.
There does exist the distinction between compounding of an
B
offence under Section 320 and quashing of a criminal case by the
High Court in exercise of inherent power under Section 482. The
two powers are distinct and different although the ultimate
consequence may be the same viz. acquittal of the accused or
dismissal of indictment.
c 60. We find no incongruity in the above principle of law and the
decisions of this Court in Simrikhia(l 990) 2 SCC 437, Dharampal
(1993) 1 SCC 435, Arnn Shankar Shukla (1999) 6 SCC 146,
lshwar Singh (2008) 15 SCC 667, Rumi Dhar (2009) 6 SCC 364
and Ashok Sadarangani (2012) 11 SCC 321. The principle
D propounded in Simrikhia that the inherentjurisdiction of the High
Court cannot be invoked to override express bar provided in law
is by now well settled. In Dharampal the Court observed the same
thing that the inherent powers under Section 482 of the Code
cannot be utilised for exercising powers which are expressly barred
by the Code. Similar statement of law is made in Arun Shankar
E Shukla. In Ishwaqr Singh the accused was alleged to have
committed an offence punishable under Section 307 !PC and with
reference to Section 320 of the Code, it was held that the offence
punishable under Section 307 !PC was not compoundable offence
and there was express bar in Section 320 that no offence shall be
F compounded if it is not compoundable under the Code. In Rumi
Dhar although the accused had paid the entire due amount as per
the settlement with the bank in the matter of recovery before the
Debts Recovery Tribunal, the accused was being proceeded with
for the commission of the offences under Sections 120-B/420/
467/468/471 IPC along with the bank officers who were being
G prosecuted under Section 13(2) read with 13 (l)(d) of the
Prevention of Corruption Act. The Court refused to quash the
charge against the accused by holding that the Court would not
quash a ease involving a crime against the society when a prima
faeie case has been made out against the accused for framing the
H charge. Ashok Sadarangani was again a case where the accused
J. RAMESH KAMATH & ORS. v. MOHANA KURUP 11 I
[JAGDISH SINGH KHEHAR, J.]

persons were charged of having committed the offences A
under Sections 120-B, 465, 467, 468 and 471, IPC and the
allegations were that the accused secured the credit facilities
by submitting forged property documents as collaterals and
utilised such facilities in a dishonest and fraudulent manner by
opening letters of credit in respect of foreign supplies of
B
goods, without actually bringing any goods but inducing the
bank to negotiate the letters of credit in favour of foreign suppliers
and also by misusing the cash-credit facility. The Court was
alive to the reference made in one of the present matters and
also the decisions in B.S.Joshi, Nikhil Merchant and Manoj
Sharma and it was held that B.S.Joshi, and Nikhil Merchant c
dealt with different factual situation as the dispute involved had
ove1iures of a civil dispute but the case under consideration
in Ashok Sadarangan i was more on the criminal intent than on a
civil aspect. The decision in Ashok Sadarangani supports the
view that the criminal matters involving overtures of a civil dispute
D
stand on a different footing.
61. The position that emerges from the above discussion can
be summarised thus: the power of the High Court in quashing
a criminal proceeding or FIR or complaint in exercise of its
inherent jurisdiction is distinct and different from the power given
to a criminal court for compounding the offences under Section E
320 of the Code. Inherent power is of wide plenitude with no
statutory limitation but it has to be exercised in accord with the
guideline engrafted in such power viz; (i) to secure the ends of
justice, or (ii) to prevent abuse of the process of any Court. In
what cases power to quash the criminal proceeding or complaint F
or F.l.R may be exercised where the offender and the victim
have settled their dispute would depend on the facts and
circumstances of each case and no category can be prescribed.
However, before exercise of such power, the High Court must
have due regard to the nature and gravity of the crime. Heinous
and serious offences of mental depravity or offences like murder, G
rape, dacoity, etc. cannot be fittingly quashed even though the
victim or victim's family and the offender have settled the dispute.
Such offences are not private in nature and have serious
impact on society. Similarly, any compromise bet\veen the victim
and the offender in relation to the offences under special statutes H
112 SUPREME COURT REPORTS [2016] 3 S.C.R.

A like the Prevention of Corruption Act or the offences committed
by public servants while working in that capacity, etc: cannot
provide for any basis for quashing criminal proceedings involving
such offences. But the criminal cases having overwhelmingly
and pre-do111inatingly civil flavour stand on a different footing
for the ptll"poses of quashing, particularly the offences arising
B
from commercial, financial, mercantile, civi I, partnership or such
like transactions or the offences arising out of matrimony relating
to dowry, etc. or the family disputes where the wrong is basically
private or personal in nature and the parties have resolved their
entire dispute. In this category of cases, the High Court may
c guash criminal proceedings if in its view, because of the
compro111ise between the offender and the victi111, the possibility
of conviction is remote and bleak and continuation of the criminal
case would put the accused to great oppression and prejudice
and extreme injustjce would be caused to him by_not guashi.rrg
the criminal case despite full and co111plete settlement and
D
yompromise with the victim. In other words, the 1-ligh Court
must consider whether it would be unfair or contrary to the
interest of justice to continue with the criminal proceeding or
continuation of the criminal proceeding would tantamount to
abuse of process of law despite settlement and compromise
E between the victim and the wrongdoer and whether to secure
the ends ofjustice, it is appropriate that the criminal case is put to
an end and if the answer to the above question(s) is in the
affirmative, the High Court shall be well within its jurisdiction to
quash the criminal proceeding."
(emphasis is ours)
F
15. A perusal of the above determination, leaves no room for any
doubt, that this Court crystalised the position in respect of the powers
vested in the High Court under Section 482 of the Criminal Procedure
Code, to quash criminal proceedings. It has now been decisively held,
that the power vested in the High Court under Section 482 of the Criminal
Procedure Code, is not Iimited to quashing proceedings within the ambit
and scope of Section 320 of the Criminal Procedure Code. The thrce-
Judge Division l3ench in the above case, clearly expounded, that quashing
of criminal proceedings under Section 482 of the Criminal Procedure
Code, could also be based on settlements between private parties, and
H could also on a compromise between the offender and the victim. Only
.J. RAMESH KAMATH & ORS. v. MOHANA KURUP 113
[.JAGDISH SINGH KHEHAR, J.]

that, the above power did not extend to crimes against the society. It is A
also relevant to mention, that the jurisdiction vested in the High Court
under Section 482 of the Criminal Procedure Code, for quashing criminal
proceedings, was held to be exercisable in criminal cases having an
overwhelming and predominatingly civil flavour, particularly offences
arising from commercial, financial, mercantile, civil. partnership, or such
B
like transactions. Or even offences arising out of matrimony relating to
dowry etc. Or family disputes where the wrong is basically private or
personal. In all such cases, the parties should have resolved their entire
dispute by themselves, mutually.
16. The question which emerges for our consideration is, whether
the allegations levelled in the complaint against respondent nos. I to 3, c
would fall within the purview of the High Court, so as to enable it to
quash the same, in exercise of its jurisdiction under Section 482 of the
Criminal Procedure Code?
17. We shall now venture to determine the above issue. A perusal
of the complaint on the basis of which criminal prosecution came to be D
initiated against respondent nos. I to 3 reveals, that the accused persons
were described as office bearers of 'the Association', during the period
from 2004 to 2008. During the course of hearing, it was not disputed,
that at the relevant time, respondent no. I - Mohana Kurup was the
President of 'the Association'; respondent no.2 -- Raveendran was the
E
Secretary of 'the Association'; and respondent no.3 - Sayed was the
Treasurer of the Association. It was alleged, that during their tenure, as
office bearers of the State Committee of 'the Association', they had
exclusive access to the funds of'the Association'. They, at their own,
managed the funds, for and on behalf of'the Association'. Consequent
upon their resignation in 2008, when an ad hoc Committee took up charge F
of the State Committee, it discovered serious misappropriation of funds
of the State Committee, which were in the name of the State Committee,
and were not accounted for. Even the account books maintained by the
State Committee, made no reference to the receipt of such amounts. A
specific reference was made to Mis Micro Labs Ltd., Bangalore, which
G
paid a sum ofRs.19,00,000/- two demand drafts being D.D.No.718573
and D.D.No.718574 in the sum of Rs.9,50,000/- each, drawn on the
Canara Bank, both dated 17 .04.2007. It was also asserted in the
complaint, that 'the Association' issued two receipts dated 30.04.2007
and 15.05.2007 in acknowledgement of the receipt of the said amounts.
It was alleged, that the said amount was never incorporated in the account H
114 SUPREME COURT REPORTS [2016] 3 S.C.R.

A books of 'the Association'. It was also alleged, that respondent nos. I to
3 dishonestly misappropriated the said amount to themselves, in violation
of bye-laws and other regulations/directions of the State Committee, by
creating false and fictitious accounts, by altering, destroying and mutilating
the original accounts of the State Committee, with a willful intention to
obtain illegal financial gains, and to defraud the State Committee. It is
B
also relevant to mention, that consequent upon completion ofinvestigation,
the chargesheet dated 22.03.2009, filed against respondent nos. I to 3,
stated thus:-
"The accused persons being the office bearers of the State
Committee, All Kerala Chemists & Druggists Association, in
c furtherance of their common intention to obtain illegal financial
gain conspired conjointly and cheated the Association and its
members by misappropriating the funds given by various drug
companies to AKCDA functioning near South Railway Station,
Ernakulam during the period from 17.04.2007 to 11.04.2008. The
D Demand Drafts and Cheques received were not credited in the
account of AKCDA. The accused falsified the accounts of
AKCDA and unauthorisedly opened accounts in South Malabar
Gramin Bank, Palakkad Branch and ICICI Bank, Edapgally
Branch and credited the amounts in the said accounts. The DD's
and cheques received were encashed in the aforesaid accounts
E on various dates and an amount of Rs.80.00.000/- was dive1ied
for their own use. The accused thereby cheated the members
and the association and committed criminal breach of trust. The
accused also committed the offence alleged."

F (emphasis is ours)
18. In the above view of the matter, we are satisfied that the
allegations levelled against respondent nos. I to 3 were of a nature, which
could not be treated as purely ofa personal nature. We are also astonished,
that the complainants, who are arrayed in the present appeal as respondent
G nos.4 to 7 affinned (in the compounding petition) that "no misappropriation
of the amounts of All Kerala Chemists and Druggists Association is
committed by the petitioners/accused persons". We are also amazed,
that respondent nos.8 and 9 herein, who were the General Secretary
and the Treasurer respectively of the Association, at the time of filing of
the compounding petition, confirmed the stand adopted by the
H
J. RAMESH KAMATH & ORS. v. MOHANA KURUP 115
[JAGDISH SINGH KHEHAR, J.]

complainants, in the compounding petition. The accusations levelled A
against respondent nos. I to 3, in our considered view, do not pertain to a
dispute which can be described as purely of a personal nature. It is also
not possible for us to acknowledge the position adopted by the
complainants, and the then members of the Association, that no
misappropriation had been committed by the accused. We cannot
B
appreciate how such a statement could have been made after the
investigation had been completed, and charges were framed, which were
pending trial before a court of competent jurisdiction.
19. We are of the view, that the basis on which the impugned order
was passed, was incorrectly determined as of a personal nature.
Additionally, the accusations were not of a nature which can be classified
c
by this Court, as were amenable to be quashed, under Section 482 of the
Criminal Procedure Code.
20. To be fair to the learned counsel for respondent Nos. 1to3, we
may also refer to Narinder Singh vs. State of Punjab, (2014) 6 SCC
466, wherein one of the offences for which the accused was proceeded D
against was under Section 307 of the Indian Penal Code. It was
submitted, that even for such criminal offences, a Court of competent
jurisdiction, under Section 482 of the Criminal Procedure Code, could
quash the criminal proceedings. Reference in this behalf was made to
the conclusions drawn by this Court in paragraphs 29.6 and 29.7, which E
are extracted hereunder:
"29.6 Offences under Section 307 JPC would fall in the category
of heinous and serious offences and therefore are to be generally
treated as crime against the society and not against the individual
alone. However, the High Court would not rest its decision merely F
because there is a mention of Section 307 !PC in the FIR or the
charge is framed under this provision. It would be open to the
High Court to examine as to whether incorporation of Section
307 IPC is there for the sake of it or the prosecution has collected
sufficient evidence, which if proved, would lead to proving the
charge under Section 307 JPC. For this purpose, it would be open G
to the High court to go by the nature of injury sustained, whether
such injury is inflicted on the vital/delegate parts of the body,
nature of weapons used, etc. Medical report in respect of in juries
suffered by the victim can generally be the guiding factor. On the
basis of this prima facie analysis, the High court can examine as H
116 SUPREME COURT REPORTS [2016] 3 S.C.R.

A to whether there is a strong possibility of conviction or the chances
of conviction are remote and bleak. In the former case it can
refuse to accept the settlement and quash the criminal proceedings
whereas in the latter case itwould be permissible for the High
Court to accept the plea compounding the offence based on
complete settlement between the pai1ies. At this stage, the cou11
B
can also be swayed by the fact that the settlement between the
pa11ies is going to result in harmony between them which may
improve their future relationship.
29.7 While deciding whether to exercise its Rower under Section
482 of the Code or not, timings of settlement play a crucial role.
c Those cases where the settlement is arrived at immediately after
the alleged commission of offence and the matter is still under
investigation, the High cou11 may be liberal in accepting the
settlement to quash the criminal proceedings/investigation. It is
because of the reason that at this stage the investigation is still on
D ancj_even the charge-sheet has not been filed. Likewise, those
cases where the charge is framed but the evidence is yet to sta11
9r the evidency is still at infancy stage, the High court can show
benevolence in exercising its powers favourably, but after prima
facie assessment of the circumstances/material mentioned above.
On the other hand, where the prosecution evidence is almost
E complete or after the conclusion of the evidence the matter is at
the stage of argument, normally the High Court should refrain
from exercising its power under Section 482 of the Code, as in
such cases the trial court would be in a position to decide the case
finally on merits and to come to a conclusion as to whether the
F offence under Section 307 IPC is committed or not. Similarly, in
those cases where the conviction is already recorded by the trial
cou11 and the matter is at the appellate stage before the High
Court, mere compromise between the parties would not be a
ground to accept the same resulting in acquittal of the offender
who has already been convicted by the trial com1. Here charge
G is proved under Section 307 IPC and conviction is already recorded
of a heinous crime and, therefore, there is no question of sparing
a convict found guilty of such a crime."
(emphasis is ours)
21. It is not possible for us to accept the submissions advanced at
1-1
J. RAMESH KAMATH & ORS. v. MOHANA KURUP 117
[JAGDISH SINGH KHEHAR, J.]

the hands of the learned counsel for respondent nos. I to 3, on the A
basis of the observations extracted hereinabove. In the above
judgment, this Court was of the view, that it would be open to the
High Court to examine, as to whether there was material to
substantiate the charge under Section 30"/ of the Indian Penal
Code, and also, to detem1ine whether the prosecution had collected
B
sufficient evidence to substantiate the said charge. And in case
sufficient evidence to sustain the charges did riot emerge, it would
be open to the High Court to quash the proceedings. We are of
the view, that the instant judgment had no relevance, to the facts
and circumstances of this case. Herein, the investigation has been
completed, and the final repo1i was filed before the Chief Judicial c
Magistrate, Ernakulam, on 22.03.2009. More than 6 years have
gone by since then. It is not the case of the accused, that the final
repo1t does not contain adequate material to substantiate the
charges. J .Ramesh Kamath, appellant i10. l herein, has been cited
as charge witness no.5; Giri Nair- appellant No.2 herein, has been
D
cited as charge witness no.6; and Antony Tharian :-- appellant
no.3 herein, has been cited as charge witness no.18. It is their
contention, that the charges are clearly made out on the basis of
documentary evidence. We would say no more. But that, the
inferences are those of the appellants, and not ours. The eventual
outcome would emerge from the evidence produced before the. E
trial court.
22. For the reasons recorded hereinabove, we allow the appeal
and set aside the impugned order passed by the High Court. CC No.90
of2009 is accordingly restored on the file of the Chief Judicial Magistrate,
Ernakulam. We direct the trial court to proceed further with the matter, F
in accordance with law.
23. In the peculiar facts and circumstances of this case, we cannot
endorse or appreciate the stand adopted by respondent Nos.4 to 9. We
accordingly direct further investigation in this matter, pertaining to the
role of respondent nos.4 to 9, and direct initiation of proceedings against Ci
them, if made out, in accordance with law.

Ocvika Ciujral Appeal allowed.