[Cites 11, Cited by 0]
Chattisgarh High Court
Manish Pal Singh Chhabra @ Rishi Singh vs State Of Chhattisgarh on 10 March, 2026
Author: Ramesh Sinha
Bench: Ramesh Sinha
1
2026:CGHC:11388-DB
ROHIT
KUMAR
NAFR
CHANDRA
Digitally signed
by ROHIT
HIGH COURT OF CHHATTISGARH AT BILASPUR
KUMAR
CHANDRA
CRMP No. 664 of 2026
1 - Manish Pal Singh Chhabra @ Rishi Singh S/o- Charanjeet Singh
Chhabra Aged About 44 Years (Wrongly Mentioned As Manish Pal
Chhabra In Cause Title Of Impugned Orders), R/o- N-12/MIG 05/5A,
Green Wood Sonata Sarachi, New Town, Near Rajarhat City Centre 02,
Rajarhat, 24 Pargana North, West Bengal (Near Rajarhat City Centre 02
Wrongly Not Mentioned In Cause Title Of Impugned Chargesheet)
2 - Sunita Kaur D/o Param Singh Kaur Aged About 35 Years R/o- 109
Maya Villa Krishnapur Tal Bagan, Rajarhat Gopalpura M North 24
Pargana, West Bengal, Previous Address- Quarter No. 9/A, Type- 2, C
Sector, District- Papum Pare, District- Itanagar, Arunachal Pradesh
(Wrongly Mentioned As Present Address- Geeta Nagar, C Sector, Type
2 Quarter No. 09/A Pamum Para, PS- C Sector In The Cause Title Of
The Impugned Order)
... Petitioners
versus
1 - State of Chhattisgarh Through Station House Officer of Police
Station- Telibandha, District- Raipur (C.G.)
2 - Jasprit Singh Bhatia S/o Late Harbhajan Singh Bhatia Aged About
42 Years R/o- Aaliya Villa, Anandam World City, Kachna, Police Station-
Khamardih, District- Raipur (C.G.)
... Respondents
For Petitioners : Ms. Aditi Singhvi, Advocate
For Respondent No.1/State : Mr. S.S. Baghel, Govt. Advocate
2
Hon'ble Shri Ramesh Sinha, Chief Justice
Hon'ble Shri Ravindra Kumar Agrawal, Judge
Order on Board
Per Ramesh Sinha, C.J.
10.03.2026
1. Heard Ms. Aditi Singhvi, learned counsel for the petitioners as well
as Mr. S.S. Baghel, learned Government Advocate, appearing for
the State/respondent No.1.
2. Present petition has been filed by the petitioners under Section
528 of the Bhartiya Nagarik Suraksha Sanhita, 2023 with the
following prayers :-
"A. The Hon'ble High Court may kindly be pleased
to quash and set aside the of FIR bearing No.
375/2023 registered at P.S. Telibandha, District
Raipur (C.G) dated 22.06.2023 at 21.50 hours under
Sections 420, 409, 120B of Indian Penal Code, 1860
which was registered against the petitioners at
instance of complaint made by respondent No. 02.
B. The Hon'ble High Court may kindly be pleased
to quash and set aside the Chargesheet dated
12.04.2025 bearing No. 151/2025 filed before
Judicial Magistrate First Class, Raipur filed in FIR
bearing No. 375/2023 registered at P.S.- Telibandha,
District Raipur (C.G) dated 22.06.2023 at 21.50
hours under Sections 420, 409, 120B of Indian Penal
Code, 1860.
C. The Hon'ble High Court may kindly be pleased
to quash and set aside the Criminal Proceedings
pending before Judicial Magistrate First Class.
Raipur (C.G) in Criminal Case No. 26947/2025 under
Sections 420, 409,120B Indian Penal Code, 1860.
D. The Hon'ble High Court may kindly be pleased
to quash and set aside the cognizance order dated
29.05.2025 passed in Criminal Proceedings pending
before Judicial Magistrate First Class. Raipur (C.G)
in in Criminal Case No. 26947/2025 under Sections
420, 409, 120B Indian Penal Code, 1860 against the
petitioners.
E. That, this Hon'ble Court may kindly be pleased
to grant any other relief, which it deems fit and
proper."
3. The present matter arises out of FIR No. 375/2023 registered at
Police Station Telibandha, District Raipur (Chhattisgarh) under
Sections 420, 409 and 120B of the Indian Penal Code, 1860
against the petitioners and one co-accused person. The
petitioners are directors of Prabhuji Etech Creations Private
Limited, a company incorporated under the Companies Act, 2013
with its registered office at Kolkata and engaged in the business
of online sale of pooja samagri and related services such as
pandit services, bhajan singers and pilgrimage arrangements. The
complainant/respondent No. 02, who was engaged in a tours and
travels business, came into contact with the company through co-
accused Anshul Dave, a Chartered Accountant who allegedly
acted as an agent of the company. It is alleged that the
complainant was advised to invest in the company and thereafter
met petitioner No. 01 at Hotel Marriott on 06-07 November 2020.
Subsequently, the complainant transferred an amount of
₹15,00,000 to the account of the company through RTGS on
21.01.2021 and allegedly paid an additional amount of ₹15,00,000
in cash to Anshul Dave between February and March 2021. Two
other persons, namely Sumit Tiwari and Sahil Mehta, also
invested ₹15,00,000 each in the company through RTGS. Thus,
according to the prosecution, a total amount of ₹60,00,000 was
invested by three persons. The complainant alleges that the
petitioners induced him to invest in the company on the promise
of profits and later misappropriated the amount. However, the
petitioners contend that the complainant was duly allotted 2500
equity shares in the company on 18.02.2021 against the
investment made by him, which was duly recorded in the minutes
of meeting and reported to the Registrar of Companies through
Form PAS-3, and a share certificate was also issued to him. It is
further stated that the complainant participated in the affairs of the
company and attended general meetings including the
Extraordinary General Meeting held on 26.05.2022. Later, due to
heavy financial losses, particularly during the COVID-19
pandemic, the company faced serious financial difficulties and
ultimately ceased operations in June 2022. Thereafter,
proceedings relating to the management of the company were
initiated before the National Company Law Tribunal, Kolkata by a
major shareholder under Sections 241 and 242 of the Companies
Act, 2013. Subsequently, the complainant lodged the present FIR
alleging cheating and misappropriation.
4. Ms. Aditi Singhvi, learned counsel for the petitioners vehemently
argued that the allegations made in the FIR are completely false
and that the present dispute is purely civil and commercial in
nature arising out of an investment made in a private company. It
is contended that the complainant had voluntarily invested money
in the company and was duly allotted equity shares equivalent to
the amount invested by him, thereby making him a shareholder in
the company. All statutory compliances required under the
Companies Act, 2013 were duly followed, including passing of
board resolutions, recording of allotment in the minutes of
meetings, filing of Form PAS-3 with the Registrar of Companies
and issuance of share certificates under Section 46 of the
Companies Act. She further argued that the complainant actively
participated in the affairs of the company and even gave his
consent for conducting an Extraordinary General Meeting on
shorter notice on 26.05.2022, which clearly indicates that he was
aware of and involved in the functioning of the company. She
also contended that the company later suffered severe financial
losses due to the COVID-19 pandemic and adverse business
conditions, which ultimately led to the closure of its operations in
June 2022. She further contended that the FIR has been lodged
after an inordinate and unexplained delay, as the investment was
made in January 2021 while the complaint was filed much later,
thereby indicating mala fide intent. It has been also contended
that proceedings regarding the management and affairs of the
company are already pending before the National Company Law
Tribunal, Kolkata, which shows that the matter essentially relates
to corporate governance and shareholder disputes. It is further
submitted that the ingredients of the offence of cheating under
Section 420 IPC are not satisfied as there was no dishonest
intention on the part of the petitioners at the time the investment
was made. Reliance has also been placed on judicial precedents
such as Sushil Sethi v. State of Arunachal Pradesh, reported in
2020 SCC Online SC 115 and Prof. R.K. Vijayasarathy v.
Sudha Seetharam, reported in 2019 SCC Online SC 208
wherein the Supreme Court held that criminal proceedings should
be quashed where the dispute is essentially civil in nature. She
lastly submitted that the present FIR is an abuse of the process of
law and falls within the categories laid down in State of Haryana
v. Bhajan Lal , reported in 1992 Supp (1) SCC 335 for quashing
of criminal proceedings.
5. Ms. Singhvi contended that the petitioner No. 01 was not having
the knowledge about the registration of the instant FIR and it was
only on 7th March 2025, when the petitioner No. 01 was
apprehended from his house in Kolkata by the police, that he
came to know about the instant FIR. The petitioner No. 01 was
later sent on Transit Remand and was granted bail by the learned
Judicial Magistrate First Class, Raipur at the remand stage itself.
She also contented that the petitioner No. 02 was granted
anticipatory bail by the learned 3rd Additional Sessions Judge
Raipur, vide Bail Application No. 753/2025 order dated
28.03.2025. She also contended that after the petitioners were
apprehended by the police, and in order to compromise the matter
amicably the petitioner No. 01 has also returned an amount of
Rs.10,00,000/- in cash to the respondent No. 02 on 10.03.2025.
6. Per contra, the learned State Counsel submitted that the
petitioners, in conspiracy with the co-accused Anshul Dave,
dishonestly induced the complainant and other investors to invest
substantial amounts of money in the company by projecting it as a
profitable venture and promising attractive returns. It is contended
that the petitioners misrepresented the financial prospects and
business model of the company in order to gain the confidence of
the complainant and persuade him to part with his money. The
complainant invested a substantial amount on the assurance that
he would receive profits and other business benefits, but the
petitioners failed to honour their representations and instead
misappropriated the funds invested by the complainant and other
investors. He further argued that the acts of the petitioners clearly
disclose the commission of offences under Sections 420, 409 and
120B of the Indian Penal Code as they obtained money through
fraudulent inducement and acted in furtherance of a criminal
conspiracy. It is further submitted that the mere issuance of
shares or maintenance of corporate records cannot absolve the
petitioners of criminal liability if the investment itself was obtained
through deception. He also contended that the existence of civil
remedies or proceedings before the National Company Law
Tribunal does not bar criminal prosecution where the allegations
disclose the commission of cognizable offences, the FIR and the
material collected during investigation disclose a prima facie case
against the petitioners and the matter requires a full trial to
determine the culpability of the accused persons.
7. We have heard the learned counsel for the parties and have
carefully perused the material placed on record.
8. It is well settled that the inherent powers of the High Court under
Section 482 of the Code of Criminal Procedure (now Section 528
of BNSS) are to be exercised sparingly and with great caution,
and only in cases where the allegations made in the complaint or
FIR, even if taken at their face value, do not disclose the
commission of any offence or where the proceedings are
manifestly attended with mala fide and constitute an abuse of the
process of the Court. At this stage, the Court is not expected to
undertake a meticulous examination of the evidence or adjudicate
upon disputed questions of fact.
9. In the present case, the allegations made in the FIR indicate that
the complainant and other investors were induced by the accused
persons to invest money in the company on the promise of profits
and business opportunities. The complainant has alleged that the
petitioners dishonestly misrepresented the financial prospects of
the company and thereby obtained money from him and other
investors. Whether the representations made by the petitioners
amounted to fraudulent inducement and whether the accused
persons had dishonest intention at the inception of the transaction
are matters that require appreciation of evidence and cannot be
conclusively determined at this stage.
10. The contention of the petitioners that the complainant was allotted
equity shares and that the dispute is purely civil in nature cannot,
at this stage, be accepted as a ground to quash the criminal
proceedings. It is settled law that the existence of a civil dispute or
the availability of civil remedies does not bar criminal prosecution
if the allegations disclose the commission of a criminal offence.
The material placed on record indicates that the complainant has
alleged deception and dishonest inducement on the part of the
petitioners, which prima facie attracts the ingredients of the
offences alleged in the FIR.
11. Furthermore, the issues raised by the petitioners regarding
allotment of shares, participation of the complainant in company
meetings, the financial losses suffered by the company, and the
delay in lodging the FIR are all matters which involve disputed
questions of fact. Such issues require detailed examination of
evidence and cannot be appropriately adjudicated in a petition
seeking quashing of criminal proceedings.
12. In view of the nature of the allegations and the material available
on record, this Court is of the considered opinion that the FIR and
the subsequent investigation disclose a prima facie case against
the petitioners. At this stage, it cannot be said that the criminal
proceedings are manifestly mala fide or that the case falls within
any of the exceptional categories laid down by the Hon'ble
Supreme Court in Bhajan Lal (supra) warranting interference by
this Court. Accordingly, this Court finds no sufficient ground to
exercise its inherent jurisdiction to quash the FIR or the
consequential proceedings.
13. For the reasons stated hereinabove, the present petition is
dismissed. However, it is clarified that the observations made in
this order are only for the purpose of deciding the present petition
and shall not prejudice the rights of the parties during the course
of trial. The petitioners shall be at liberty to raise all permissible
defences before the competent trial court in accordance with law.
Sd/- Sd/-
(Ravindra Kumar Agrawal) (Ramesh Sinha)
Judge Chief Justice
Chandra
