Delhi High Court
Amit Gupta & Ors vs State & Anr on 22 April, 2025
IN THE HIGH COURTOF DELHIAT NEW DELHI
% Judgment delivered on:22.04.2025
+ CRL.M.C. 2078/2019, CRL.M.A. 33470/2019 & CRL.M.A.
13801/2024
AMIT GUPTA & ORS .....Petitioners
versus
STATE & ANR .....Respondents
Advocates who appeared in this case:
For the Petitioners : Ms. Geeta Luthra, Sr. Adv. along with Mr.
Manas Agrawal & Mr. Rishabh Dahiya,
Advs.
For the Respondents : Mr. Naresh Kumar Chahar, APP for the
State.
SI Amit, EOW.
Mr. Sharique Hussain, Adv. for R-2.
CORAM
HON'BLE MR JUSTICE AMIT MAHAJAN
JUDGMENT
1. The present petition has been filed by the petitioners seeking
quashing of FIR No. 830/2014 dated 15.09.2014 filed under Sections
420/ 468/ 471 of the Indian Penal Code, 1860 ('IPC') registered at
Police Station Kalkaji, and proceedings emanating therefrom.
2. The FIR was registered pursuant to an application filed by
Respondent No. 2/ complainant under Section 156 (3) of the Code of
Criminal Procedure, 1973 ('CrPC') against M/s Shree Shyam Pulp &
Board Mills Ltd. (hereafter 'accused company') and its directors
including the petitioners, being the authorised signatories of the
accused company. The application was filed alleging that the accused
company had approached Respondent No. 2 for services towards
Domestic Sale Bill Factoring Facility ('DSBFF') from Respondent
No. 2. It is alleged that Respondent No. 2 sanctioned a DSBFF to the
tune of ₹5 crore to the accused company vide Sanction Letter dated
06.11.2009. The said facility was enhanced to ₹8 crore vide
Supplement Agreement dated 08.03.2010 for factoring of receivables.
The said facility was further enhanced to ₹15 crore vide Supplement
Agreement dated 03.06.2011 for factoring of receivables. It is alleged
that an amount of ₹15 crore was disbursed in favour of the accused
company qua the forged and fabricated invoices produced by the
accused company in the name of M/s Rahul Marketing Co. Pvt Ltd.,
Gujarat State Board of School Text Books and M/s Shivam Road
Lines Transport Co. An amount of ₹17,35,00,000/- was stated to be
due and outstanding on part of the accused company towards
Respondent No. 2.
3. It is stated that the accused company issued cheques drawn in
favour of Respondent No. 2 in repayment of the debt, however, these
cheques returned unpaid, following which Respondent No. 2
conducted inquiries about the business dealings of the accused
company when it was revealed that the approved debtor has never
been in existence at their given address and both the accused company
as well as the approved debtor had the same fax number. It is alleged
that the Directors of the accused company, including the petitioners
herein, hold majority shares in the accused company and are the
beneficiaries of the amount cheated from Respondent No. 2.
4. During course of investigation, the Director of Gujarat State
Board of School Text Books stated that no paper supply order has
been issued to the accused company in the month of July, 2013, and
that neither any goods/ shipment has been received nor any payment
has been made in that regard. It was also revealed that no transport
company in the name of M/s Shivam Road Lines Transport Co. was
found at the address mentioned in the bill produced by the accused
company.
5. Petitioner Nos. 1 and 3 were granted bail vide orders dated
25.05.2015 and 08.04.2015 respectively, passed by the learned
Additional Sessions Judge ('ASJ'). Petitioner No. 2 filed BAIL
APPLN No. 1090/ 2015 seeking pre-arrest bail, wherein a co-ordinate
bench of this Court, vide order dated 02.06.2015 granted interim
protection from arrest to Petitioner No. 2, subject to him joining the
investigation.
6. In the meanwhile, chargesheet was filed against Petitioner No. 1
under Section 420/ 468/ 471 read with Section 120-B of the IPC.
7. On 21.12.2016, the accused company through Petitioner No. 2,
entered into a One Time Settlement with the complainant, wherein a
sum of ₹5.5 crore was to be paid by the accused company in
instalments as per the following payment schedule:
S.No. Particulars Time of Amount in ₹
Payment
1. Upfront Payment 50,00,000/-
2. 1st Instalment 31.12.2016 75,00,000/-
3. 2nd Instalment 25.02.2017 25,00,000/-
4. 3rd Instalment 31.03.2017 4,00,00,000/-
5. Total 5,50,00,000/-
8. It was also agreed that in case of delay in payment, interest at
the rate of 14.50% p.a. would be applicable on the delayed payment
and in case of default of payment, the complainant shall revoke the
settlement. It was further agreed that all litigation pending before
different forums shall be kept in abeyance during the period settlement
terms are being satisfied and any or all claims or disputes arising out
of or in connection with the said settlement shall be settled by
Arbitration.
9. The accused company thereafter offered a modification to the
settlement dated 21.12.2016 vide its letter dated 09.10.2018, which
was duly accepted by the complainant, and in terms thereto, the time
to deposit the balance payment was to be extended in view of the
liquidation proceedings faced by the accused company and interest
was to be paid by the accused company on the balance amount of ₹2.5
crore on or before 15.02.2019. The relevant portion of the letter dated
0910.2018 is reproduced hereunder:
"Now, as per mutual discussions/agreement with buyer, we propose to
clear the balance outstanding settled dues of SSPBML as per following
schedule:
1) Rs 25 lacs immediately via Demand Draft No. 261120 dated
31.07.2018 issued from Axis Bank Ltd in favour of IFCI Factors Ltd.
2) Rs 50 lacs via Cheques issued directly by buyer Mr. Jasvinder Singh
s/o Mr. Gurmeet Singh (vide Ch# 000085for Rs 25 lacs dated
25.10.2018 issued in favour of "IFCI Factors Ltd" & Ch#000086 for
Rs 25 lacs dated 25.10.2018 issued from Punjab & Sind Bank in
favour of "IFCI Factors Ltd"). We are also issuing one security cheque
of Rs 50 lacs (Ch# 264293 for Rs 50 lacs issued from Axis Bank AJc
Mr. Naresh Kumar Gupta in favour of "IFCI Factors Ltd") with the
condition that the same shall be returned back after encashment of the
abovementioned 2 cheques of Rs 25 lacs each issued by the buyer &
shall only be presented in case the said 2 cheques return unpaid & are
not cleared by the buyer.
3) Rs 50 lacs on or before 31.12.2018
4) Balance Rs 250 lacs along with interest @ 14.5% p.a. on or before
15.02.2019.
Therefore, in lieu of the above, we request you to kindly accept the
above proposal so that we can clear your dues as per abovementioned
schedule."
(emphasis supplied)
10. By order dated 20.11.2018 in BAIL APPLN No. 1090/ 2015,
the co-ordinate bench of this Court recorded the settlement entered
into by the parties and directed Petitioner No. 2 to pay the balance
amount of ₹3 crore as a condition for his pre-arrest bail, in default of
which, the relief granted to him would automatically be vacated.
11. As per the affidavit filed on behalf of the Respondent No. 2 in
the year 2020, it is stated that the principal sum of ₹5.5 crore has been
received from the accused company in instalments, concluding on
31.03.2019, after a delay of almost 3 years as per the payment
schedule. It was further stated that since the payment is delayed in
terms of the payment schedule, an amount of ₹1,01,46,424/- is payable
by the accused company, as interest accrued from 31.12.2016.
12. The co-ordinate bench vide order dated 18.11.2021 dismissed
the application filed by the complainant seeking cancellation of bail in
BAIL APPLN No. 1090/ 2015, while noting the admitted modification
to the settlement vide letter dated 09.10.2018, held that the interest of
14.5% p.a. was to be paid on the deferred payment from the date of
the settlement, that is, 21.12.2016, however since the amount was
already paid, Petitioner No. 2 was directed to pay the interest of
14.5.% p.a. on the sum of ₹2.5 crore from 09.10.2018 till the date of
payment within twelve weeks. It was observed as under:
"12.As noted in paragraph 4, Crl.M.A.50245/2018 was disposed off
vide order dated 21st January, 2019 noting this letter dated 9th
October, 2018 and as per Clause (4) balance ₹250 lacs along with
interest @ 14.5.% p.a. on or before 15th February, 2019. However, the
issue before this Court is whether the interest on this ₹250 lacs @
14,5.% p.a. was payable from which date. As noted in the letter dated
9th October, 2018, no interest was payable for the payments to be
made as per Clauses (1), (2) and (3). However, as the payment of
₹250 lacs was a deferred payment, interest @ 14.5% p.a. was to be
paid on this deferred payment obviously from the date of settlement
as it was a part of the onetime settlement of ₹550 lacs.
13.As the amount has already been paid, this Court finds no ground
to cancel the anticipatory bail granted, however, subject to the
petitioner paying interest on the sum of ₹250 lacs from 9th October,
2018 till the date of payment @ 14.5.% p.a. within twelve weeks.
14.Applications are disposed off.
15.Order be uploaded on the website of this Court."
(emphasis supplied)
13. Respondent No. 2 filed an application seeking modification of
the order dated 18.11.2021, contending that since the settlement was
executed on 21.12.2016, the accused company should be directed to
pay interest from the said date itself, instead of 09.10.2018. The said
application was dismissed by the co-ordinate bench vide order dated
03.02.2022, finding no ground to modify the order dated 18.11.2021.
It was observed as under:
"4.Based on the documents filed before this Court, this Court held that
since the one-time settlement vide letter dated 21st December, 2016
was modified by the subsequent letter of the petitioner dated 9th
October, 2018, this Court noted that there was no material before it to
come to the conclusion that the anticipatory bail order should be
revoked. Hence this Court finds no ground to modify the order dated
18th November, 2021.
5. In case based on any other documents available with the applicant,
the applicant is of the view that the petitioner is entitled to payment of
interest with effect from 21st December, 2016 instead of 9th October,
2018, the petitioner would be at liberty to take remedies in accordance
with law.
6.Application is dismissed."
14. By order dated 09.02.2022 passed by this Court in the present
petition, the petitioners were directed to deposit the Demand Drafts in
compliance of the order dated 18.11.2021, with the Registrar General
of this Court, since the same was refused to be accepted on behalf of
the Respondent No. 2.
15. It is also relevant to note that the Special Leave Petition filed by
Respondent No. 2 against the order dated 18.11.2021 and 03.02.2022
was dismissed vide order dated 13.05.2022 passed by the Hon'ble
Apex Court, while clarifying that if any civil remedy is availed by the
petitioner, it may be decided on its own merits in accordance with law,
without being influenced by the observation made in the impugned
orders passed by the High Court.
16. The learned senior counsel for the petitioners submitted that the
parties had settled their disputes and no proceedings ought to continue
in the present FIR. She relied on the order dated 20.11.2018 wherein
the co-ordinate bench of this Court recorded the settlement entered
into by the parties.
17. She submitted that the settlement agreement categorically states
that all the claims and disputes arising out of the settlement agreement
shall be settled by arbitration, which makes it clear that the disputes
pursuant to entering into the settlement had been rendered civil and
commercial in nature.
18. The learned counsel for Respondent No. 2 submitted that the
petitioners have paid the balance 2.5 crore from the principal amount
and a sum of ₹8.34 lacs towards interest of 14.5% on the delayed
payments with effect from 31.12.2018 till 25.03.2019, however, since
the petitioners did not make the payments in accordance with the One
Time Settlement or the letter dated 09.10.2018, the interest on the
delayed payment was payable from 21.12.2016 till 09.04.2019,
amounting to ₹1,01,46,424/-.
19. He submitted that pursuant to the order dated 20.11.2018 and as
undertaken by the petitioners vide the settlement captured in the letter
dated 09.10.2018, Petitioner No. 2 handed over 2 cheques, one for₹50
lacs and one for ₹2.5 crore, however when the cheque for ₹50 lacs was
presented for payment by Respondent No. 2, it was returned unpaid
for reason "signature mismatched".
20. He stated that on dishonour of the cheque for ₹50 lacs,
Petitioner No. 2 requested that the same may be replaced by two
cheques of ₹25 lacs each, drawn in favour of Respondent No. 2,
however even the said cheques were returned unpaid for reason
"Funds Insufficient".
21. He submitted that despite various communication sent by
Respondent No. 2, Petitioner No. 2 defaulted in making payments in
terms of the order dated 20.11.2018, pursuant to which Respondent
No. 2 also filed an application seeking vacation of the protection
granted to Petitioner No. 2, in which notice was issued.
22. He further submitted that this Court vide order dated 27.02.2019
condoned the default on part of the petitioners while imposing cost. It
is submitted that on the said date, this Court took note of the
arguments advanced by the counsels of both the parties in regard to
the date of levying interest of 14.5%, and directed Petitioner No. 2 to
pay the balance amount of ₹2.5 crore and the interest with effect from
31.12.2018 on or before 25.03.2019, and posted the matter for
consideration as to whether the interest would be applicable from
21.12.2016 or from the date suggested by the petitioners, that is,
31.12.2018.
23. I have heard the submissions made by the parties and perused
the record.
24. The dispute in the present case started with the accused
company Shree Shyam Pulp & Board Mills Ltd. availing credit facility
from the complainant IFCI Factors Limited. The FIR was registered
way back on 15.09.2014 on the allegation that the accused company
and its directors, including the petitioners herein, had defrauded the
complainant of ₹14.97 crores. It is pointed out that the complainant
had also issued a demand notice under Section 13(2) of the
Securitisation and Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002. Undisputedly, the matter
was settled pursuant to the One Time Settlement offer made by the
complainant for a sum of ₹5.5 crores to be paid in installments, as per
the payment schedule stipulated therein.
25. The parties, thereafter entered into the One Time Settlement
dated 21.12.2016 specifically agreeing that any or all claims and
disputes arising out of or in connection with the settlement or in
performance thereof, shall be settled by arbitration. The relevant
clause is reproduced as under:
"Any or all claims & disputes arising out of or in connection with this
Agreement or in performance shall be settled by Arbitration by a single
Arbitrator to be appointed by the Factor, i.e. IFCI Factors Limited,
which shall be binding on the parties. The Arbitration proceedings shall
be held in English language and shall be held at New Delhi, accordance
with the Arbitration and Conciliation Act, 1996.Both the parties shall
equally share the expenses of the Arbitrator. The award passed by the
Arbitrator shall be final binding on the patties. However, the above said
Arbitration clause shall apply/operate, if the Factor, i.e. IFCI Factors
Limited, avails its statutory remedies under the Factoring Regulation Act,
2011."
26. Pursuant to the registration of the FIR, Petitioner No. 2 had filed
an application seeking pre-arrest BAIL APPLN No. 1090/ 2015 and
the fact that the parties have settled their disputes was duly noted
during the proceeding in that bail application. The bail application
was, however, kept pending for compliance of the terms of the
settlement agreement.
27. It is undisputed that vide further agreement dated 09.10.2018,
the terms of the settlement dated 21.12.2016 were modified and the
time for payment was extended on the request of the accused persons.
The payments were made by the accused persons from time to time.
Certain dispute appears to have arisen between the parties in regard to
the payment of interest and as noted in Paragraph 12 above, the Co-
ordinate Bench in BAIL APPLN No. 1090/2015 dismissed the
application filed by Respondent No. 2 seeking cancellation of bail vide
order dated 18.11.2021 while noting that a substantial amount has
already been paid by the accused persons and directed Petitioner No. 2
to pay interest of 14.5% p.a. on the deferred payment of ₹2.5 crore
from 09.10.2018 till the date of payment, within 12 weeks.
28. In the meantime, the present petition also came to be filed
wherein an affidavit was filed by the complainant accepting that the
parties have settled their disputes, albeit, certain amount is left to be
paid. The complainant, however, preferred a Special Leave Petition
before the Hon'ble Apex Court challenging the order dated
18.11.2021 and a subsequent order dated 03.02.2022, dismissing the
review of order dated 18.11.2021 filed by the complainant.
29. It is relevant to note that the complainant had not disputed that
the parties have settled the matter, but was aggrieved by the finding of
the Co-ordinate Bench in the order dated 18.11.2021, that the accused
was liable to pay interest on a sum of ₹2.5 crore from 09.10.2018. It
was the case of the complainant that the interest was payable from
21.12.2016 since the accused persons delayed the payment of
instalments.
30. As noted earlier, the Hon'ble Apex Court dismissed the Special
Leave Petition filed by the complainant while granting liberty to the
complainant that it can seek civil remedy and as and when the same is
availed, it may be decided on its own merits, without being influenced
by the observations made by the High Court.
31. It is pertinent to note that the complainant only addressed
arguments on the point of the One Time Settlement entered upon
between the parties. The learned counsel for the complainant argued
that the petitioners did not make the payments in accordance with the
One Time Settlement or the letter dated 09.10.2018 and therefore the
interest on the delayed payment was payable from 21.12.2016. Thus, it
is apparent that the dispute, at this stage, does not relate to the original
complaint which led to registration of the FIR, but essentially relates
to the amount which may be payable by the accused persons in terms
of the One Time Settlement and the modified terms. The dispute
which was subject matter of the FIR, therefore, came to an end with
the parties entering into a settlement.
32. The petitioners though claimed that no further amount is
payable, however, according to the complainant, entire amount is not
paid.
33. At this stage, it is relevant to note that the Co-ordinate Bench of
this Court by order dated 18.11.2021, had held that the accused
persons are liable to pay interest on a sum of ₹2.5 crore from
09.10.2018, that is, the date when the parties had agreed to modifying
the terms of the original settlement. Petitioners claimed that the said
amount has already been paid.
34. The Hon'ble Apex Court did not interfere with the order dated
18.11.2021. However, since the dispute related to the amount that
may be actually payable, granted liberty to the complainant to initiate
civil proceedings in that regard, since the same may require some sort
of adjudication.
35. It is also relevant to note that in terms of the One Time
Settlement, the parties had agreed that all claims and disputes arising
out of or in connection with the settlement or in its performance, shall
be settled by arbitration. The parties had agreed that all the earlier
disputes had come to an end on the execution of the One Time
Settlement. Thus, in the opinion of this Court, all disputes including
the dispute in regard to the complaint, which led to the registration of
the FIR, came to an end, giving fresh cause to the complainant to
agitate its grievances by initiating proceedings in terms of the
settlement.
36. The Hon'ble Apex Court in its order dated 13.05.2022, gave the
similar liberty to the complainant to avail civil remedy in accordance
with law.
37. Considering the totality of the facts, as noted above, it is evident
that the parties have settled all their disputes which had originally led
to registration of the FIR and the same ought not to continue after
parties agreed to settle the dispute on payment of money.
38. Any subsequent dispute in regard to the amount that may be
payable pursuant to the settlement, gives fresh cause of action, which
ought to be adjudicated in appropriate proceedings, but the same
cannot be used as a tool to continue with the original criminal
complaint.
39. In terms of the directions in order dated 18.11.2021, the interest
component had to be handed over to Respondent No. 2. The
petitioners duly sought to deliver Demand Draft bearing No.281355
dated 10.01.2022 for Rs.8,24,315/- and Demand Draft bearing
No.281384 dated 13.01.2022 for Rs.32,178/-, both drawn on Axis
Bank in favour of Respondent No. 2 however they refused to accept
the same, whereafter this Court directed the petitioners to deposit the
same with the Registrar General of this Court.
40. As noted above, the complainant is not disputing the quashing
of the FIR, but is merely seeking interest on the delayed payment to be
payable from 21.12.2016.
41. At this stage, the grievance of the complainant cannot be
addressed in the present proceedings under Section 482 of the CrPC as
is sought to be done in the present case. Pursuant to the parties
entering into a settlement, the complainant had put a closure to the
complaint which led to registration of the subject FIR. Any subsequent
dispute with regard to the payments, if any pending, would be in the
nature of a civil dispute, for which the parties had agreed to take
recourse in accordance with the terms of the settlement agreement.
42. The liberty to pursue the civil remedies has also been granted by
the Hon'ble Apex Court and thus, the complainant may be at liberty to
pursue the remedies but the said remedy cannot be in the form of
continuing the criminal proceedings initiated prior to the parties
entering into a settlement.
43. In view of the above, this Court feels that no useful purpose
would be served by keeping the dispute alive and continuance of the
proceedings would amount to abuse of the process of Court. I am of
the opinion that this is a fit case to exercise discretionary jurisdiction
under Section 482 of the CrPC.
44. In view of the above, FIR No. 830/2014 and all consequential
proceedings arising therefrom are quashed.
45. The present petition is allowed in the aforesaid terms.
AMIT MAHAJAN, J
APRIL 22, 2025
