Gujarat High Court
Sangitaben Sanjay Sanklecha vs State Of Gujarat on 3 February, 2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CRIMINAL APPLICATION (QUASHING) NO. 1431 of 2025
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SANGITABEN SANJAY SANKLECHA & ORS.
Versus
STATE OF GUJARAT & ANR.
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Appearance:
MR BHUVNESH GAHLOT(10286) for the Applicant(s) No. 1,2,3
MS. SHRUTI PATHAK, APP for the Respondent(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE SANDEEP N. BHATT
Date : 03/02/2025
ORAL ORDER
1. The present petition is filed for the following prayers:
"A) Be pleased to admit this application;
B) Be pleased to pass appropriate writ, order or
direction and be pleased to quash and set aside FIR
being FIR No. 11191011240019, dated 25/01/2024
registered at D.C.B. Police Station of Ahmedabad City
for the alleged offences punishable under 406, 420
and 114 of Indian Penal Code, 1860 by invoking
powers under section 528 of Bharatiya Nagarik
Suraksha Sanhita, 2023 read with Article 226 of the
Constitution of India; and CC case 2469/25 and all
Proceedings arsing out of it in the interest of justice
C) Be pleased to pass interim relief and by way of
interim relief grant stay of further proceedings of
arising out of the said FIR being FIR No.
11191011240019, dated 25/01/2024 registered at D.C.B.
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Police Station of Ahmedabad City for the alleged
offences punishable under 406, 420 and 114 of Indian
Penal Code, 1860, and CC case 2469/25 before the
Chief Additional Metro Court No.11 Ahmedabad,
pending admission and final hearing of this petition.
D) Be pleased to pass such orders as thought fit in
the interest of justice."
2. Brief facts of the case are as under:
2.1 The respondent No.2 has registered the FIR against the
present accused persons and have alleged that, in the year
2019, the petitioners who are relative of the complainant
(Petitioner No. 1 is the sister of Complainant's wife) visited
the house of the complainant. It is further alleged that the
petitioners owned various companies in the name and style of
(1) Federal Process Automation Pvt. Ltd. (2) Arihant
Corporation (HUF) and (3) Federal Jumbo Packaging Pvt.
Ltd. and the petitioners are generating good profits from
these companies and they wish to expand their business,
however, requested the complainant to lend some amount and
petitioners will give 17% in return to her daughter, Nikita
for every three months and if, complainant wife, Kalpanaben
lent the amount then petitioner will give 15% in return for
every three months. Therefore, the complainant's wife and her
daughter, Kalpanaben and Nikita transferred a total sum of
Rs. 1,75,00,000/- and in lieu of the aforesaid the petitioners
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have only paid a sum of Rs. 52,75,707/- till 31/03/2021 and it
is further alleged that, the petitioners, without the consent of
the complainant as made the shareholder of Federal Process
Automation Pvt. Ltd. and Federal Jumbo Packaging Pvt. Ltd.
and therefore, the complainant has approached the D.C.B.
Police Station and registered the FIR being FIR No.
11191011240019, dated 25/01/2024 registered at D.C.B. Police
Station of Ahmedabad City for the alleged offences punishable
under 406, 420 and 114 of Indian Penal Code, 1860 against
the present petitioners-accused.
2.2 Being aggrieved and dissatisfied with the impugned FIR
and charge-sheet filed by the concerned I.O. in connection
with the impugned FIR as well as consequential proceedings
thereof, the petitioners have approached this Court.
3. Heard learned advocate Mr. Bhuvnesh Gahlot for the
petitioners, learned advocate Mr. Kishan Brahmbhatt for the
respondent No.2 - original complainant and Ms. Shruti
Pathak, learned APP for the respondent - State.
4. Learned advocate Mr. Bhuvnesh Gahlot for the
petitioners has submitted that on bare reading of the FIR, no
ingredients of Section 406 of the Indian Penal Code has been
attracted towards the present petitioners as the petitioners
have taken loan from Kalpanaben and Nikita Jain from 2019
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till 2020 and by the end of March, 2021, the petitioners have
already paid amount of Rs.52,75,707/- to Kalpanaben and
Nikita Jain and therefore, ingredients of Section 406 of the
IPC would not come into play as there was no entrustment
and dominion over the property of the complainant. He has
further submitted that on bare reading of the FIR, no
ingredients of Section 420 of the IPC has been attracted
towards the present petitioners as the petitioners have taken
loan from Kalpanaben and Nikita Jain from 2019 till 2020
and by the end of March, 2021, the amount is repaid as
mentioned earlier and for constituting offence under Section
420 of the IPC, there has to be intention/ mens rea. He
further submits that on bare reading of the FIR, no
allegations are there which can fulfill the criteria of dishonest
intention against the present petitioners and therefore, he has
submitted that the continuation of the proceedings pursuant
to the impugned FIR would amount to abuse of process of
law. In support of his submissions, he has relied upon the
judgment of the Hon'ble Apex Court in the case of Sri
Gulam Mustafa Vs. State of Karnataka reported in 2023 (8)
Scale 43, more particularly, paras 36 to 39. He has also
relied on the judgment of Division Bench of this Hon'ble
Court in the case of Viral Mukund Shah Vs. State of
Gujarat reported in 2023 GLH 4 554, more particularly,
paras 17 and 18. Therefore, he has submitted that the
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continuation of the proceedings pursuant to the impugned
FIR, which is essentially of civil nature dispute, would cause
great hardship to the petitioners and therefore, he prays for
quashing of the impugned FIR.
5. Learned advocate Mr. Brahmbhatt for the original-
complainant has submitted that on bare reading of the FIR,
the offences are made out against the present petitioners. He
has further submitted that before the City Civil Court, the
petitioners have approached by praying for anticipatory bail,
which came to be rejected vide order dated 20.02.2024. He
has submitted that earlier also vide order dated 15.06.2023,
the trial Court has rejected the application, which is filed as
Criminal Misc. Application No.4159 of 2023. He has further
submitted that now the charge sheet is filed in the present
case and it clearly transpires from the FIR that the
petitioners have deliberately and dishonestly cheated the
complainant by making shareholder in the company named as
Federal Process Automation Pvt. Ltd. and Federal Jumbo
Packaging Pvt. Ltd. without the consent of the complainant.
Moreover, he submits that amount of Rs.1,23,17,556/- received
by the present petitioners from the complainant, is not repaid
though it is promised that it will be repaid with 17% and
15% interest respectfully. Therefore, he has submitted that
there is no reason to interfere with the present proceedings
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as prima facie case is made out against the present
petitioners.
6. Learned APP, Ms. Shruti Pathak has strongly opposed
the submissions made at the bar on behalf of the petitioners
and has submitted that now the charge-sheet is filed and
considering the material available on record, it cannot be said
that no offence is made out under Section 406 or 420 of the
IPC and therefore, she has submitted that the petitioners
may face the trial before the concerned trial Court as there
is sufficient material available on record along with charge-
sheet which constitute offence as alleged in the impugned
FIR.
7. I have considered the rival submissions made at the
bar, I have also considered the provisions of Sections 405,
406, 415 and 420 of the Indian Penal Code, which read as
under:
"405. Criminal breach of trust.--
Whoever, being in any manner entrusted with property, or
with any dominion over property, dishonestly misappropriates
or converts to his own use that property, or dishonestly uses
or disposes of that property in violation of any direction of
law prescribing the mode in which such trust is to be
discharged, or of any legal contract, express or implied, which
he has made touching the discharge of such trust, or wilfully
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suffers any other person so to do, commits "criminal breach of
trust".
Explanation 1.-- A person, being an employer of an
establishment whether exempted under section 17 of the
Employees' Provident Funds and Miscellaneous Provisions Act,
1952 (19 of 1952), or not who deducts the employee's
contribution from the wages payable to the employee for
credit to a Provident Fund or Family Pension Fund
established by any law for the time being in force, shall be
deemed to have been entrusted with the amount of the
contribution so deducted by him and if he makes default in
the payment of such contribution to the said Fund in
violation of the said law, shall be deemed to have dishonestly
used the amount of the said contribution in violation of a
direction of law as aforesaid.
Explanation 2.-- A person, being an employer, who deducts
the employees' contribution from the wages payable to the
employee for credit to the Employees' State Insurance Fund
held and administered by the Employees' State Insurance
Corporation established under the Employees' State Insurance
Act, 1948 (34 of 1948), shall be deemed to have been
entrusted with the amount of the contribution so deducted by
him and if he makes default in the payment of such
contribution to the said Fund in violation of the said Act,
shall be deemed to have dishonestly used the amount of the
said contribution in violation of a direction of law as
aforesaid.
Illustrations
(a)A, being executor to the will of a deceased person,
dishonestly disobeys the law which directs him to divide the
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effects according to the will, and appropriate them to his own
use. A has committed criminal breach of trust.
(b)A is a warehouse-keeper. Z going on a journey, entrusts
his furniture to A, under a contract that it shall be returned
on payment of a stipulated sum for warehouse room. A
dishonestly sells the goods. A has committed criminal breach
of trust.
(c)A, residing in Calcutta, is agent for Z, residing at Delhi.
There is an express or implied contract between A and Z,
that all sums remitted by Z to A shall be invested by A,
according to Z's direction. Z remits a lakh of rupees to A,
with directions to A to invest the same in Company's paper.
A dishonestly disobeys the direction and employs the money
in his own business. A has committed criminal breach of
trust.
(d)But if A, in the last illustration, not dishonestly but in
good faith, believing that it will be more for Z's advantage to
hold shares in the Bank of Bengal, disobeys Z's directions,
and buys shares in the Bank of Bengal, for Z, instead of
buying Company's paper, here, though Z should suffer loss,
and should be entitled to bring a civil action against A, on
account of that loss, yet A, not having acted dishonestly, has
not committed criminal breach of trust.
(e)A, a revenue-officer, is entrusted with public money and is
either directed by law, or bound by a contract, express or
implied, with the Government, to pay into a certain treasury
all the public money which he holds. A dishonestly
appropriates the money. A has committed criminal breach of
trust.
(f)A, a carrier, is entrusted by Z with property to be carried
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by land or by water. A dishonestly misappropriates the
property. A has committed criminal breach of trust.
406. Punishment for criminal breach of trust.--
Whoever commits criminal breach of trust shall be punished
with imprisonment of either description for a term which may
extend to three years, or with fine, or with both.
415. Cheating.--
Whoever, by deceiving any person, fraudulently or dishonestly
induces the person so deceived to deliver any property to any
person, or to consent that any person shall retain any
property, or intentionally induces the person so deceived to do
or omit to do anything which he would not do or omit if he
were not so deceived, and which act or omission causes or is
likely to cause damage or harm to that person in body, mind,
reputation or property, is said to "cheat".
Explanation.-- A dishonest concealment of facts is a deception
within the meaning of this section.
Illustrations
(a)A, by falsely pretending to be in the Civil Service,
intentionally deceives Z, and thus dishonestly induces Z to let
him have on credit goods for which he does not mean to pay.
A cheats.
(b)A, by putting a counterfeit mark on an article, intentionally
deceives Z into a belief that this article was made by a
certain celebrated manufacturer, and thus dishonestly induces
Z to buy and pay for the article. A cheats.
(c)A, by exhibiting to Z a false sample of an article,
intentionally deceives Z into believing that the article
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corresponds with the sample, and thereby, dishonestly induces
Z to buy and pay for the article. A cheats.
(d)A, by tendering in payment for an article a bill on a house
with which A keeps no money, and by which A expects that
the bill will be dishonored, intentionally deceives Z, and
thereby dishonestly induces Z to deliver the article, intending
not to pay for it. A cheats.
(e)A, by pledging as diamonds article which he knows are not
diamonds, intentionally deceives Z, and thereby dishonestly
induces Z to lend money. A cheats.
(f)A intentionally deceives Z into a belief that A means to
repay any money that Z may lend to him and thereby
dishonestly induces Z to lend him money. A not intending to
repay it. A cheats.
(g)A intentionally deceives Z into a belief that A means to
deliver to Z a certain quantity of indigo plant which he does
not intend to deliver, and thereby dishonestly induces Z to
advance money upon the faith of such delivery. A cheats; but
if A, at the time of obtaining the money, intends to deliver
the indigo plant, and afterwards breaks his contract and does
not deliver it, he does not cheat, but is liable only to a civil
action for breach of contract.
(h)A intentionally deceives Z into a belief that A has
performed A's part of a contract made with Z, which he has
not performed, and thereby dishonestly induces Z to pay
money. A cheats.
(i)A sells and conveys an estate to B. A, knowing that in
consequence of such sale he has no right to the property,
sells or mortgages the same to Z, without disclosing the fact
of the previous sale and conveyance to B, and receives the
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purchase or mortgage money from Z. A cheats.
420. Cheating and dishonestly inducing delivery of property.--
Whoever cheats and thereby dishonestly induces the person
deceived to deliver any property to any person, or to make,
alter or destroy the whole or any part of a valuable security,
or anything which is signed or sealed, and which is capable
of being converted into a valuable security, shall be punished
with imprisonment of either description for a term which may
extend to seven years, and shall also be liable to fine."
7.1 I have also considered the tenor of the FIR, whereby, it
is stated that it was offered by the present petitioners to the
complainant, that the complainant will get 17% and 15%
interest and therefore, Rs.1,75,00,000/- out of that, initially
Rs.52,75,707/- were paid and thereafter, the rest of the
amount of Rs.1,63,08,282/- were not paid even in the year
2021 and thereafter, the name of the complainant, Nikita
Jain and Kalpanaben were mentioned as shareholders in the
Federal Process Automation Pvt. Ltd. and Federal Jumbo
Packaging Pvt. Ltd. without their consent or knowledge.
Moreover, considering the fact that even the anticipatory bail
which was asked by way of application filed by the concerned
trial Court in the year 2023 and lastly in 2024, came to be
rejected vide order dated 20.02.2024 passed by the learned
Sessions Court. It also transpires from the papers available
on the record that prima facie the petitioners are involved in
the alleged offences.
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7.2 Furthermore, it transpires that the complainant becomes
shareholder without consent and a huge amount is not repaid
after initially giving promise to pay 17% and 15% interest on
such huge amount of Rs.1,75,00,000/-, out of that only Rs.52
lakh and odd amount is repaid and that too, as per the
situation prevailed in the year 2021. There is also civil
remedy available with the complainant, but considering the
facts and circumstances of the present case, the ingredients
of Section 406 and 420 of the IPC are also prima facie
satisfied. It is to be noted that now the charge-sheet is also
filed against the present petitioners. This Court while
considering the application for quashing has to exercise its
powers very sparingly, specially when, the Court is of the
opinion that no prima facie case is made out or Court is of
the opinion that the continuation of the proceedings would
amount to miscarriage of justice or misuse of process of law.
7.3 Considering the facts of the present case, the Court is
of the opinion that since the prima facie case is made out
against the present petitioners and charge-sheet is also filed
after investigation as well as considering the allegations made
in the FIR and the papers of the charge-sheet, it cannot be
said that the continuation of the proceedings would amount
to miscarriage of justice. Therefore, the judgments cited by
the learned advocate for the petitioners reported in 2023 (8)
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Scale 43 and 2023 GLH 4 554, are not helpful to the facts
of the present case. There is no quarrel about the ratios and
principles laid down by those judgments, but facts of those
cases are different from the facts of the present case, in the
present case, prima facie case is made out against the
present petitioners under Section 406 and 420 of the IPC.
7.4 It is apt to refer to the case of Neeharika
Infrastructure Pvt.Ltd. V/s State of Maharashtra reported in
2021 SCC Online SC 315, wherein, it is held in paragraph
80 as under:
"80. In view of the above and for the reasons stated above,
our final conclusions on the principal/core issue, whether the
High Court would be justified in passing an interim order of
stay of investigation and/or "no coercive steps to be
adopted", during the pendency of the quashing petition
under Section 482 Cr.P.C and/or under Article 226 of the
Constitution of India and in what circumstances and
whether the High Court would be justified in passing the
order of not to arrest the accused or "no coercive steps to
be adopted" during the investigation or till the final
report/chargesheet is filed under Section 173 Cr.P.C., while
dismissing/disposing of/not entertaining/not quashing the
criminal proceedings/complaint/FIR in exercise of powers
under Section 482 Cr.P.C. and/or under Article 226 of the
Constitution of India, our final conclusions are as under:
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i) Police has the statutory right and duty under the
relevant provisions of the Code of Criminal Procedure
contained in Chapter XIV of the Code to investigate into a
cognizable offence;
ii) Courts would not thwart any investigation into the
cognizable offences;
iii) It is only in cases where no cognizable offence or offence
of any kind is disclosed in the first information report that
the Court will not permit an investigation to go on;
iv) The power of quashing should be exercised sparingly
with circumspection, as it has been observed, in the 'rarest
of rare cases (not to be confused with the formation in the
context of death penalty).
v) While examining an FIR/complaint, quashing of which is
sought, the court cannot embark upon an enquiry as to the
reliability or genuineness or otherwise of the allegations
made in the FIR/complaint;
vi) Criminal proceedings ought not to be scuttled at the
initial stage;
vii) Quashing of a complaint/FIR should be an exception
rather than an ordinary rule;
viii) Ordinarily, the courts are barred from usurping the
jurisdiction of the police, since the two organs of the State
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operate in two specific spheres of activities and one ought
not to tread over the other sphere;
ix) The functions of the judiciary and the police are
complementary, not overlapping;
x) Save in exceptional cases where non-interference would
result in miscarriage of justice, the Court and the judicial
process should not interfere at the stage of investigation of
offences;
xi) Extraordinary and inherent powers of the Court do not
confer an arbitrary jurisdiction on the Court to act according
to its whims or caprice;
xii) The first information report is not an encyclopaedia
which must disclose all facts and details relating to the
offence reported. Therefore, when the investigation by the
police is in progress, the court should not go into the merits
of the allegations in the FIR. Police must be permitted to
complete the investigation. It would be premature to
pronounce the conclusion based on hazy facts that the
complaint/FIR does not deserve to be investigated or that it
amounts to abuse of process of law. After investigation, if
the investigating officer finds that there is no substance in
the application made by the complainant, the investigating
officer may file an appropriate report/summary before the
learned Magistrate which may be considered by the learned
Magistrate in accordance with the known procedure;
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xiii) The power under Section 482 Cr.P.C. is very wide, but
conferment of wide power requires the court to be more
cautious. It casts an onerous and more diligent duty on the
court;
xiv) However, at the same time, the court, if it thinks fit,
regard being had to the parameters of quashing and the
self-restraint imposed by law, more particularly the
parameters laid down by this Court in the cases of R.P.
Kapur (supra) and Bhajan Lal (supra), has the jurisdiction
to quash the FIR/complaint;
xv) When a prayer for quashing the FIR is made by the
alleged accused and the court when it exercises the power
under Section 482 Cr.P.C., only has to consider whether the
allegations in the FIR disclose commission of a cognizable
offence or not. The court is not required to consider on
merits whether or not the merits of the allegations make
out a cognizable offence and the court has to permit the
investigating agency/police to investigate the allegations in
the FIR;
xvi) The aforesaid parameters would be applicable and/or the
aforesaid aspects are required to be considered by the High
Court while passing an interim order in a quashing petition
in exercise of powers under Section 482 Cr.P.C. and/or
under Article 226 of the Constitution of India. However, an
interim order of stay of investigation during the pendency of
the quashing petition can be passed with circumspection.
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Such an interim order should not require to be passed
routinely, casually and/or mechanically. Normally, when the
investigation is in progress and the facts are hazy and the
entire evidence/material is not before the High Court, the
High Court should restrain itself from passing the interim
order of not to arrest or "no coercive steps to be adopted"
and the accused should be relegated to apply for
anticipatory bail under Section 438 Cr.P.C. before the
competent court. The High Court shall not and as such is
not justified in passing the order of not to arrest and/or "no
coercive steps" either during the investigation or till the
investigation is completed and/or till the final
report/chargesheet is filed under Section 173 Cr.P.C., while
dismissing/disposing of the quashing petition under Section
482 Cr.P.C. and/or under Article 226 of the Constitution of
India. xvii) Even in a case where the High Court is prima
facie of the opinion that an exceptional case is made out for
grant of interim stay of further investigation, after
considering the broad parameters while exercising the powers
under Section 482 Cr.P.C. and/or under Article 226 of the
Constitution of India referred to hereinabove, the High Court
has to give brief reasons why such an interim order is
warranted and/or is required to be passed so that it can
demonstrate the application of mind by the Court and the
higher forum can consider what was weighed with the High
Court while passing such an interim order.
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xviii) Whenever an interim order is passed by the High
Court of "no coercive steps to be adopted" within the
aforesaid parameters, the High Court must clarify what does
it mean by "no coercive steps to be adopted" as the term
"no coercive steps to be adopted" can be said to be too
vague and/or broad which can be misunderstood and/or
misapplied."
7.5 At this stage, it would be fruitful to refer to the recent
decision of the Hon'ble Apex Court in the case of Somjeet
Mallick versus State of Jharkhand and others reported in
(2024) 10 SCC 527, more particularly Paras : 15, 17and 18
thereof, which read as under :
" 15. Before we proceed to test the
correctness of the impugned order, we must
bear in mind that at the stage of deciding
whether a criminal proceeding or FIR, as the
case may be, is to be quashed at the
threshold or not, the allegations in the FIR
or the police report or the complaint,
including the materials collected during
investigation or inquiry, as the case may be,
are to be taken at their face value so as to
determine whether a prima facie case for
investigation or proceeding against the
accused, as the case may be, is made out.
The correctness of the allegations is not to
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be tested at this stage.
17. It is trite law that FIR is not an
encyclopaedia of all imputations. Therefore, to
test whether an FIR discloses commission of
a cognizable offence what is to be looked at
is not any omission in the accusations but
the gravamen of the accusations contained
therein to find out whether, prima facie,
some cognizable offence has been committed
or not. At this stage, the Court is not
required to ascertain as to which specific
offence has been committed.
18. It is only after investigation, at the
time of framing charge, when materials
collected during investigation are before the
Court, the Court has to draw an opinion as
to for commission of which offence the
accused should be tried. Prior to that, if
satisfied, the Court may even discharge the
accused. Thus, when the FIR alleges a
dishonest conduct on the part of the accused
which, if supported by materials, would
disclose commission of a cognizable offence,
investigation should not be thwarted by
quashing the FIR."
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8. In view of the foregoing reasons, I am of the opinion
that no relief can be granted in favour of the present
petitioners as prima facie case is made out against the
petitioners and the proceedings are required to be continued
pursuant to the charge-sheet. Therefore, the present petition
is not required to be considered at this stage and the same
is required to be dismissed.
9. Accordingly, the present petition is dismissed.
(SANDEEP N. BHATT,J)
SLOCK BAROT
