[Cites 37, Cited by 0]
Bombay High Court
Amit Anand Rathi And Anr vs The State Of Maharashtra And Anr on 10 December, 2025
Author: R.N.Laddha
Bench: R.N.Laddha
Digitally signed
2025:BHC-AS:54017 CHITRA SANJAY
by CHITRA
SONAWANE
SANJAY Date:
SONAWANE 2025.12.10
14:21:14
+0530
Chitra Sonawane 901-WP-555-2020.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CRIMINAL APPELLATE JURISDICTION
Criminal Writ Petition No.555 of 2020
1. Amit Anand Rathi
284-15, Kalpataru Horizon
SK Ahire Marg, Worli,
Mumbai- 400 018.
2. Anand Rathi Commodities Limited
8 Floor, A Wing, Express Zone,
Opp. Oberoi Mall, Goregaon(E),
Mumbai - 400 063. ... Petitioners
Versus
1. The State of Maharashtra
Through the Secretary,
Government of Maharashtra
Mantralaya, Madam Cama Road,
Mumbai- 400 032.
2. Economic Offences Wing
(NSEL SIT) CB-CID, 3rd floor,
New Police Commissioners office
building, Mumbai - 400 001. ... Respondents
----
Mr Amit Desai, Sr Advocate a/w Mr Sajal Yadav, Mr Anukul
Seth, Mr Gopalkrishna Shenoy, Mr Arpit Mutha and Mr
Aayushya Geruja, i/by Mr Harsh Ghangurde for the petitioners.
Mr Avinash Avhad, SPP, a/w Mr Mahesh Rawool and Mr SV
Walve, APP for the respondents No.1 and 2.
API Yogesh Bhadre, EOW.
----
Page 1 of 23
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Coram : R.N.Laddha, J.
Reserved on : 5 December 2025.
Pronounced on: 10 December 2025.
Order:
This Petition under Articles 226 and 227 of the
Constitution of India and Section 482 of the Code of Criminal
Procedure, 1973, assails the legality, propriety and correctness
of an order dated 4 March 2019 passed by the learned
Designated MPID Court, Mumbai, issuing process against the
Petitioners for the offences punishable under Sections 409, 420,
467, 468, 471, 474, 477A, and 120B of the Indian Penal Code,
and Section 3 of the Maharashtra Protection of Interest of
Depositors (in Financial Establishments) Act, 1999.
2. The prosecution alleges that numerous investors traded
through brokers on the NSEL platform, where their funds were
lent to designated borrowers who were required to maintain
commodity stocks as collateral. These borrowers allegedly
failed to maintain the stocks and later defaulted, causing heavy
investor losses. It is further alleged that Petitioner No.2, a
financial services company, knowingly participated in NSEL's
unlawful "pair-trade" scheme and induced clients to invest by
giving false assurances of risk-free returns, proper due
diligence, and a functioning Settlement Guarantee Fund, none
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of which actually existed.
3. The prosecution also asserts that Petitioner No.2 issued
misleading stock confirmations to NSEL's auditors, altered
client codes without consent, and ignored regulatory duties. In
collusion with NSEL, it allegedly created a system where no
warehouse receipts or physical commodities backed investor
funds. When defaults occurred, Petitioner No.2 neither
contributed to the guarantee fund nor compensated its clients.
Petitioner No.1, as a director of Petitioner No.2 during the
relevant period, is alleged to be responsible for its operations
and therefore vicariously liable for these acts.
4. Mr Amit Desai, the learned Senior Counsel appearing on
behalf of the Petitioners, submitted that even assuming the
entire charge sheet to be true, no prima facie grounds exist to
proceed against the Petitioners. The Petitioners have been
mechanically arrayed in the fourth charge sheet dated 25
December 2018, without any material indicating their
involvement in the alleged offences. Apart from bald and
unsupported allegations, the charge sheet discloses no material
demonstrating complicity. The Petitioners are not the principal
accused, yet are being compelled to face criminal proceedings
solely because their names appear in the fourth charge sheet.
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5. It is submitted that NSEL, incorporated in May 2005 by
63 Moons (formerly FTIL), commenced operations pursuant to
the Government Notification dated 5 June 2007. As per
Respondent No.2's own case in the first charge sheet, NSEL
alone launched the various contracts, including farmer, pair and
e-series contracts. Petitioner No.2 had no role in
conceptualising or launching these products. As a trading-cum-
clearing member, Petitioner No.2 merely executed trades on
behalf of its clients in its capacity as a broker, and settlement of
contracts was exclusively NSEL's responsibility. Respondent
No.2's own allegations in the fourth charge sheet further
establish that 63 Moons provided the software through which
pair contracts operated, thereby reinforcing that the Petitioners
played no role in the setting up of the exchange or the design of
the contract.
6. The learned Senior Counsel further submitted that the
fourth charge sheet contains no allegations whatsoever against
Petitioner No.1, who has been arrayed as an accused solely by
virtue of being a director of Petitioner No.2, and criminal
liability cannot be imposed vicariously unless expressly
provided by statute. Section 3 of the MPID Act makes liable
only those persons responsible for the management or conduct
of the business. To treat a mere director, without any allegation
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of responsibility or active role, as criminally liable would render
the provision unconstitutional. Respondent No.2's attempt to
implicate Petitioner No.1 without any averment of managerial
responsibility or specific role, it is argued, falls far short of the
statutory threshold. The fourth charge sheet, which attributes
no independent act or intent to Petitioner No.1, is therefore
liable to be quashed. In this regard, Mr Desai placed reliance on
the decisions in: (i) Sunil Bharti Mittal vs. CBI, (2015) 4 SCC
609; (ii) SMS Pharmaceuticals Limited vs. Neeta Bhalla, (2005)
8 SCC 89; (iii) Castrol (India) Ltd vs. State of Karnataka,
(2018) 17 SCC 275; (iv) Maksud Saiyed vs. State of Gujarat,
(2008) 5 SCC 668; (v) Shiv Kumar Jatia vs. State of Delhi,
(2019) 17 SCC 193; (vi) Ravindranatha Bajpe vs. Mangalore
Special Economic Zone Ltd, (2022) 15 SCC 430; (vii) SP Mani
@ Mohan Dairy vs. Snehlata Elangovan, (2023) 10 SCC 685;
(viii) State of Haryana vs. Brij Lal Mittal, (1998) 5 SCC 343;
(ix) JK Industries vs. Chief Inspector of Factories and Boilers,
(1996) 6 SCC 665; and (x) GHCL Employees Stock Option
Trust vs. India Infoline Ltd., (2013)4 SCC 505.
7. It is also submitted that apart from nominal brokerage, the
Petitioners received no money or benefit from NSEL or any
defaulters. A Lok Sabha reply dated 3 February 2017 expressly
records that no money trail was found in Petitioner No.2's bank
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accounts. The charge sheet also contains no material showing
that the Petitioners knew of any illegality on the NSEL platform
or conspired in the alleged offences. Although Respondent
No.2 alleges that Petitioner No.2 modified unique client codes
(UCC), such modifications were expressly permitted under
NSEL's Circular of 8 July 2011, and no regulator, including
SEBI or any stock exchange, has taken action against Petitioner
No.2 or any broker for UCC modification.
8. Mr Desai further contended that Respondent No.2 itself
admits that NSEL launched the illegal pair contracts, and
Petitioner No.2 had no role in this. Petitioner No.2 merely
executed trades as per client instructions and did not
independently "participate" in pair trading. It is also denied
that Petitioner No.2 induced investors. The marketing materials
relied upon by Respondent No.2 contain clear disclaimers and
risk warnings, which Respondent No.2 has ignored despite
seizing and relying on these documents. The clients voluntarily
chose to trade on the NSEL platform despite explicit warnings;
therefore, the requirements of Section 420 IPC are not met.
9. Regarding allegations of failure to verify warehouse stocks
or conduct due diligence, the learned Senior Counsel argued
that this reflects a misunderstanding of the NSEL system. As
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per Respondent No.2's own charge sheet, NSEL issued and
retained warehouse receipts and was solely responsible for
ensuring stock existence and verification. Thus, the due
diligence allegations against Petitioner No.2 lack any legal or
factual basis. As to the Digital Forensic Audit Report alleging
rampant UCC modification and use of ghost/ dummy codes, it
is submitted that the report was never placed before the learned
Judge. Petitioner No.2 denies using any ghost codes and states
that clerical errors cannot constitute criminal conduct.
Moreover, apart from one pending appeal, no client has filed
any recovery or damages claims against Petitioner No.2.
Petitioner No.2 earned only 0.2% brokerage per transaction.
The allegation that Petitioner No.2 knowingly exposed clients
to risk is unfounded, as clients were repeatedly warned of risks,
and criminal liability cannot be imposed merely because clients
chose to trade despite such disclaimers.
10. The learned Senior Counsel submitted that Respondent
No.2 has levelled an allegation of collusion against Petitioner
No.2 without furnishing even the basic particulars necessary to
establish such a charge. There is no reference to any meeting of
minds, any interaction, any role, or any foundational element
that could constitute collusion. It is further submitted that
Respondent No.2 has taken mutually contradictory positions
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within the same investigation, while alleging that NSEL was
required to maintain the settlement guarantee fund, it
simultaneously contends that Petitioner No.2 was responsible
for contributing to it. Such inconsistencies reveal that the
allegation is baseless and does not justify the continuation of
criminal proceedings against the Petitioners.
11. Drawing attention to the impugned order, the learned
Senior Counsel submitted that the order is entirely cryptic and
mechanically passed. The learned Judge failed to appreciate
that the issuance of process is a serious judicial act and that
criminal law cannot be set into motion as a matter of routine. A
summoning order must reflect due application of mind to the
facts and the applicable law. It is well settled that there must be
sufficient indication of the factual foundation constituting the
alleged offences before proceeding against an accused. Absence
of such indication demonstrates lack of judicious consideration,
warranting this Court's intervention under its inherent powers
to prevent abuse of process.
12. In this respect, the learned Senior Counsel relied on: (i)
Pepsi Foods Ltd vs. Special Judicial Magistrate, (1998) 5 SCC
749; (ii) Mehmood Ul Rehman vs. Khazir Mohammad Tunda,
(2015) 12 SCC 420; and (iii) Lalankumar Singh vs. State of
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Maharashtra, 2022 SCC OnLine SC 1383.
13. It is further submitted that the impugned order wrongly
issues process against the Petitioners under Sections 409, 420,
467, 468, 471, 474, 477-A, and 120-B IPC and Section 3 of the
MPID Act. The offences of criminal breach of trust and
cheating cannot co-exist on the same facts, and that essential
ingredients of Sections 409 and 420 are entirely absent.
According to the learned Senior Counsel, invoking both
provisions demonstrates non-application of mind.
14. Mr Desai further asserted that the fourth charge sheet
contains no allegation from any investor claiming to have been
deceived, induced, or wrongfully caused loss by any act of
Petitioner No.2. In the absence of any assertion of deception or
corresponding wrongful loss, no offence under Section 420 IPC
is made out. Even the statement of witness Porus Saranjit Singh
does not disclose any inducement attributable to the Petitioners,
and therefore no prima facie case under Section 420 IPC arises.
The learned Senior Counsel also submitted that the fourth
charge sheet discloses no material whatsoever to constitute
forgery. No forged document is identified, nor is any
falsification or mens rea alleged. Similarly, the allegation of
criminal conspiracy under Section 120-B IPC is unsupported by
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any factual foundation and is based merely on conjecture and
suspicion. There is no averment of any agreement between the
Petitioners and NSEL.
15. In respect of Section 3 of the MPID Act, it is argued that
Respondent No.2 has failed to establish even prima facie that
any "financial establishment fraudulently defaulted on payment
of a deposit". The charge sheet does not define or identify any
"deposit", "amount", "investor", or "default" relating to the
Petitioners. As there is no statutory basis for vicarious liability
under the IPC and no specific allegations against Petitioner
No.1, the invocation of Section 3 is unsustainable. The learned
Senior Counsel submitted that the material collected by
Respondent No.2, including its own charge sheets, witness
statements, risk presentations, and the Digital Forensic Report,
supports the Petitioners' case and contradicts the allegations in
the fourth charge sheet.
16. Mr Desai contended that Respondent No.2's objection
regarding maintainability on the ground of an alternate remedy
under Section 11 of the MPID Act is misconceived. The
inherent powers of this Court under Section 482 CrPC and
Articles 226 and 227 of the Constitution cannot be excluded.
Section 11 is enabling, not prohibitory, and Section 14 of the
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MPID Act does not curtail inherent jurisdiction. As no reason is
shown to restrict this Court's jurisdiction, and as the threshold
for quashing stands satisfied, the issuance of summons against
the Petitioners deserves to be set aside. The learned Senior
Counsel further argued that the inherent powers of this Court
are not created by the statute, but merely preserved by it. In
support of his contentions, Mr Desai cited the decision in: (i)
Dhariwal Tobacco Products Ltd vs. The State of Maharashtra,
(2009) 2 SCC 370; (ii) Prabhu Chawla vs. The State of
Rajasthan, (2016) 16 SCC 30; and (iii) Dhyan Investments and
Trading Co Ltd vs. CBI, (2023) 2 SCC (Bom) 222.
17. Furthermore, it is pointed out that Section 11 of the
MPID Act is merely an enabling provision permitting any
aggrieved person, including the Competent Authority, to file an
appeal before this Court within sixty days. Unlike the Special
Court (Trial of Offences Relating to Transactions in Securities)
Act, 1992, or the TADA Act, 1987, the MPID Act contains no
exclusionary clause barring other appeals or revisions. It also
differs from the MCOCA, 1999, which contains a non-obstante
clause in its appeal provision. No such bar or non-obstante
clause exists in the MPID Act, and therefore Section 11 does
not exclude the inherent powers of this Court or prohibit
recourse to the CrPC.
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18. According to the learned Senior Counsel, a comparison of
these statutes shows that the MPID Act stands on a different
footing, and the absence of express prohibitions clearly
indicates that the Legislature did not intend to curtail this
Court's inherent jurisdiction. Consequently, once this Court is
satisfied that the case warrants the exercise of such jurisdiction,
it is duty bound to quash criminal proceedings. It is also not the
Respondent No.2's case that this Court lacks jurisdiction.
19. It is further submitted that, while passing the impugned
order, the learned Judge ought to have examined whether the
Petitioners derived any benefit beyond brokerage, whether their
role exceeded that of a broker, and the nature and scope of
representations made, including whether such representations
constituted inducement from inception, which is essential to
attract the offence of cheating. The learned Judge was also
required to assess whether the UCC constituted the Petitioners'
property for the purpose of forgery, whether the ingredients of
forgery were prima facie satisfied, whether knowledge of
alleged Exchange irregularities could be attributed to the
Petitioners, and whether any contractual or legal obligation
required them to contribute to the Settlement Guarantee Fund.
Furthermore, the learned Judge was required to examine if
applicant No.1 had benefitted in any manner, such as through
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dividends or salary, if he served as an executive director
responsible for the company's affairs, if he made any
representation to any person for making investments, and if he
had knowledge of the alleged illegalities committed by the
exchange.
20. On the other hand, Mr Avinash Avhad, the learned Special
Public Prosecutor representing the Respondents, submitted that
the Petitioners have an efficacious statutory remedy of appeal
under Section 11 of the MPID Act against the impugned order.
They cannot bypass this remedy by invoking Articles 226 and
227 of the Constitution or Section 482 CrPC. Reliance was
placed on (i) Harsherekha Ajay Garg vs. State of Maharashtra,
2022 SCC OnLine Bom 1197; (ii) Thansingh Nathmal vs.
Superintendent of Taxes, AIR 1964 SC 1419; and (iii) CIT vs.
Chhabil Dass Agarwal, (2014) 1 SCC 603.
21. The learned SPP submitted that a prima facie case exists
against the Petitioners, showing their nexus with NSEL officials
and other co-accused in furtherance of a criminal conspiracy.
The Petitioners maintained close associations with key NSEL
personnel, participated in misrepresentation and inducement of
investors, and were involved in manipulative practices such as
price rigging and circular trading. He emphasised that
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unauthorised alteration of the UCCs enabled undue benefit to
NSEL, indicating collusion.
22. The learned SPP outlined the NSEL trading mechanism,
its exemption under the 2007 Department of Consumer Affairs
notification, and the introduction of one-day forward contracts
and later paired T+2/T+25 contracts, which were approved by
NSEL's Board. He explained the warehousing and settlement
procedure, under which NSEL was responsible for verifying
and holding commodities. According to the FIR, 25 seller-
members, in collusion with NSEL, traded fictitious stocks and
raised funds on forged warehouse receipts, causing huge losses
to the investors. Investigations revealed that NSEL deviated
from the approved trading model, induced investors with false
assurances of returns, and operated without actual underlying
stock. After regulatory intervention by FMC in 2012-2013,
NSEL suspended trading and was eventually shut down in July
2013. The learned SPP detailed the defaulting entities and the
subsequent charge sheets filed against various accused,
including the Petitioners, in MPID Special Case No.5 of 2019,
wherein cognisance was taken and process was issued on 4
March 2019.
23. The learned SPP further submitted that the Petitioners
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induced clients to invest in NSEL paired contracts, utilised the
UCC, and earned about Rs.12.25 crores in brokerage between
2009 and 2013. Petitioner No.1, as a director, controlled the
affairs of Petitioner No.2, which traded in illegal paired
contracts on behalf of clients. He argued that there is sufficient
material to justify issuance of process, and the question of the
Petitioners' ultimate culpability is a matter for trial.
24. This Court has given anxious consideration to the rival
submissions canvassed across the Bar and perused the record,
including the affidavit-in-reply and the written notes of
arguments.
25. It is a well-settled proposition of law that this Court is
vested with inherent powers under Section 482 of the CrPC to
make such orders as may be necessary to give effect to any
order passed under the Code, prevent abuse of the process of
any Court, or otherwise to secure the ends of justice. These
powers, though extraordinary in nature, are not illimitable and
must be exercised sparingly, with circumspection, and in
accordance with sound judicial principles. The amplitude of the
power under Section 482 CrPC is indeed wide; however, its
very plenitude demands that it be invoked with caution. The
inherent jurisdiction of this Court is not derived from any
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express provision but flows from its very constitution as a
Court of law, entrusted with the solemn duty of ensuring the
proper administration of justice.
26. It is equally trite that this Court, in appropriate cases, may
invoke its writ jurisdiction under Articles 226 and 227 of the
Constitution of India to prevent miscarriage of justice or to
correct grave procedural irregularities. The exercise of such
jurisdiction, whether under the Constitution or the CrPC, must
necessarily be guided by the facts and circumstances of each
case, and not by any rigid formula.
27. As regards the preliminary objection to the maintainability
of the present Petition, it is the contention of the learned SPP
that the Petitioners ought to have availed the statutory remedy
of appeal, which remains open to them. However, the learned
SPP does not dispute the legal position that this Court retains
its inherent and supervisory jurisdiction under Section 482
CrPC and Articles 226 and 227 of the Constitution,
notwithstanding the existence of an alternate remedy.
28. It is now well established that the availability of an
alternate remedy, by itself, does not operate as an absolute bar
to the invocation of this Court's jurisdiction under the
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aforementioned provisions. There exists no statutory embargo
that precludes the filing of a petition under Section 482 CrPC
or Articles 226 and 227 of the Constitution solely on the
ground that an appellate remedy is available. In this context,
reliance may be placed on the authoritative pronouncement of
the Hon'ble Supreme Court in Prabhu Chawla (supra), wherein
it was categorically held that the existence of an alternate
remedy does not ipso facto bar the exercise of writ or inherent
jurisdiction, particularly where the interest of justice so
demands. The relevant paragraph reads as under:
"6. In our considered view any attempt to explain
the law further as regards the issue relating to
inherent power of the High Court under Section
482 CrPC is unwarranted. We would simply
reiterate that Section 482 begins with a non
obstante clause to state:
"482. Saving of inherent powers of High
Court.--Nothing in this Code shall be deemed
to limit or affect the inherent powers of the
High Court to make such orders as may be
necessary to give effect to any order under this
Code, or to prevent abuse of the process of
any court or otherwise to secure the ends of
justice."
A fortiori, there can be no total ban on the exercise
of such wholesome jurisdiction where, in the words
of Krishna Iyer, J.
"abuse of the process of the court or other
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extraordinary situation excites the Court's
jurisdiction. The limitation is self-restraint,
nothing more". (Raj Kapoor case [Raj Kapoor
v. State, (1980) 1 SCC 43 : 1980 SCC (Cri)
72] , SCC p. 48, para 10)
We venture to add a further reason in support.
Since Section 397 CrPC is attracted against all
orders other than interlocutory, a contrary view
would limit the availability of inherent powers
under Section 482 CrPC only to petty interlocutory
orders. A situation wholly unwarranted and
undesirable."
29. In the present Petition, the Petitioners seek to challenge
the order dated 4 March 2019 passed by the learned trial Court
in MPID Case No.5 of 2019, whereby process was issued
against the Petitioners. The order reads thus:
"Issue process against the accused for the offence
punishable under Sections 409, 420, 467, 468,
471, 474, 477A and 120B of IP Code and Section 3
of the MPID Act. O-issue summons to accused
Nos.1 to 63. "
30. A bare perusal of the impugned order reveals that it is
wholly unreasoned and devoid of any indication of judicial
application of mind. The order does not disclose the opinion
formed by the learned Judge, nor does it set out the context or
the basis on which the alleged offence was considered to be
prima facie made out. It is a well-settled principle of law that,
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although a Magistrate or Special Judge is not required to render
an elaborate or detailed order while issuing process, the act of
issuance of process is not an empty formality. Such an order
cannot be passed as a matter of routine or mechanical exercise.
If the learned Judge proceeds to issue process without a
cautious and circumspect evaluation of the material placed on
record and without due appreciation of the statutory
requirements, it may result in the unwarranted initiation of
criminal proceedings and compel an innocent individual to face
the rigours of a criminal trial. Therefore, before directing the
issuance of process, the learned Judge is obliged to exercise his
judicial discretion judiciously, apply his mind to the material
before him, and satisfy himself that sufficient grounds exist to
summon the Petitioners to stand trial. Once such satisfaction is
arrived at, the learned Judge must record, at least briefly, the
opinion so formed.
31. It is equally settled in law that where an order issuing
process fails to reflect this foundational application of mind,
and does not demonstrate that the statutory preconditions for
summoning an accused were duly considered, such an order
becomes unsustainable in law and is liable to be set aside. A
profitable reference in this regard may be made to the decision
of the Hon'ble Supreme Court in Lalankumar Singh (supra),
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wherein it was held as follows:
"28. The order of issuance of process is not an
empty formality. The Magistrate is required to
apply his mind as to whether sufficient ground for
proceeding exists in the case or not. The formation
of such an opinion is required to be stated in the
order itself. The order is liable to be set aside if no
reasons are given therein while coming to the
conclusion that there is a prima facie case against
the Accused. No doubt, that the order need not
contain detailed reasons. A reference in this respect
could be made to the judgment of this Court in the
case of Sunil Bharti Mittal v. Central Bureau of
Investigation, (2015) 4 SCC 609, which reads thus:
51. On the other hand, Section 204 of
the Code deals with the issue of process,
if in the opinion of the Magistrate taking
cognizance of an offence, there is
sufficient ground for proceeding. This
Section relates to commencement of a
criminal proceeding. If the Magistrate
taking cognizance of a case (it may be the
Magistrate receiving the complaint or to
whom it has been transferred Under
Section 192), upon a consideration of the
materials before him (i.e. the complaint,
examination of the complainant and his
witnesses, if present, or report of inquiry,
if any), thinks that there is a prima facie
case for proceeding in respect of an
offence, he shall issue process against the
Accused.
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52. A wide discretion has been given as
to grant or refusal of process and it must
be judicially exercised. A person ought
not to be dragged into court merely
because a complaint has been filed. If a
prima facie case has been made out, the
Magistrate ought to issue process and it
cannot be refused merely because he
thinks that it is unlikely to result in a
conviction.
53. However, the words "sufficient
ground for proceeding" appearing in
Section 204 are of immense importance.
It is these words which amply suggest that
an opinion is to be formed only after due
application of mind that there is sufficient
basis for proceeding against the said
Accused and formation of such an opinion
is to be stated in the order itself. The
order is liable to be set aside if no reason
is given therein while coming to the
conclusion that there is prima facie case
against the Accused, though the order
need not contain detailed reasons. A
fortiori, the order would be bad in law if
the reason given turns out to be ex facie
incorrect.
29. A similar view has been taken by this Court in
the case of Ashoke Mal Bafna (supra)."
32. In the present case, the order issuing process against the
Petitioners is vitiated by a lack of judicial application of mind
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and appears to have been passed in a mechanical manner. The
impugned order merely reproduces the statutory provisions
invoked, without recording the learned Judge's prima facie
satisfaction as to the existence of the essential ingredients
constituting the alleged offence. The order under challenge is
cryptic, devoid of reasoning, and fails to disclose the
foundational basis upon which the learned Judge formed the
opinion that process ought to be issued against the Petitioners.
Although the judgment relied upon by the learned Senior
Counsel for the Petitioners pertains to proceedings arising from
a private complaint, the legal ratio laid down therein is of
general applicability and governs all instances wherein a
criminal court exercises its power to take cognisance of an
offence.
33. Therefore, in view of the foregoing discussion, this Court
is constrained to hold that the impugned order issuing process
against the Petitioners cannot be sustained in law. It is pertinent
to note that this Court has refrained from undertaking an
exhaustive analysis of all aspects that may arise in the matter.
This restraint is primarily because this Court is satisfied that the
impugned order is, on its face, cryptic and demonstrative of a
lack of judicial application of mind. The foundational basis for
arriving at this conclusion is the failure of the learned Judge to
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consider and apply the parameters delineated by the Hon'ble
Supreme Court in Lalankumar Singh (supra), as well as other
binding precedents governing the issuance of process. The
omission to adhere to these mandatory considerations vitiates
the impugned order and renders it unsustainable.
34. Accordingly, the impugned order issuing process against
the Petitioners is liable to be quashed and set aside. However, it
is equally imperative to recognise that any lapse on the part of
the learned Judge in discharging his judicial duty should not
result in prejudice to the Respondents. They ought not to suffer
adverse consequences for no fault of their own. In view thereof,
the impugned order of issuance of process qua the Petitioners
stands quashed and set aside, and the learned Judge is directed
to reconsider the matter afresh, taking into account all relevant
aspects of the case, and to pass an appropriate order on its own
merits and strictly in accordance with law.
35. The writ petition stands disposed of accordingly.
[R. N. Laddha, J.]
____________________________________________
10 December 2025
