Divesh Kumar Bajaj vs The State Of Madhya Pradesh
2023 Latest Caselaw 6175 MP

                                                                       -1-


                                 IN THE HIGH COURT OF MADHYA PRADESH
                                              AT I N D O R E
                                                                      BEFORE
                                               HON'BLE SHRI JUSTICE VIVEK RUSIA
                                                        ON THE 18th OF APRIL, 2023
                                                CRIMINAL REVISION No. 2983 of 2022

                           BETWEEN:-
                           DIVESH KUMAR BAJAJ S/O SHRI RAM CHANDRA
                           BAJAJ, AGED ABOUT 53 YEARS, OCCUPATION:
                           CHARTERED ACCOUNTANTS, M-26 SECOND
                           FLOOR, GURU HARKISHAN NAGAR, DELHI-87,
                           PRESENTLY IN DISTRICT JAIL, DEWAS (MADHYA
                           PRADESH)
                                                                                                           .....PETITIONER
                           (SHRI AJAY KUMAR MISHRA, LEARNED SENIOR ADVOCATE ALONG WITH
                           MS. SOUMYA SETHI, LEARNED COUNSEL FOR THE PETITIONER.)

                           AND
                           THE STATE OF MADHYA PRADESH STATION
                           HOUSE OFFICER, THROUGH POLICE STATION
                           BAGHANA, DISTRICT NEEMUCH (MADHYA
                           PRADESH)
                                                                                                        .....RESPONDENTS
                           (Ms. MAMTA SHANDILYA, LEARNED GOVERNMENT ADVOCATE FOR THE
                           RESPONDENT/STATE.)

                                         Reserved on                         :            20.03.2023
                                         Delivered on                        :            18.04.2023
                           --------------------------------------------------------------------------------------------------------
                                   This revision coming on for orders this day, the court passed the
                           following:

                                                                         ORDER

With the consent of the parties, heard finally.

Signature Not Verified Signed by: DIVYANSH SHUKLA Signing time: 18-04-2023 18:18:59

An applicant who is one of the accused in Special Case No.53/2021 pending in the Court of First Additional Sessions Judge, Neemuch has filed this Criminal revision under Section 397 r/w Section 401 of Code of Criminal Procedure Code, 1973 challenging the order dated 07.07.2022 whereby charges under Section 420 of IPC in alternative Section 420/120-B of IPC, Section 409 of IPC in alternative Section 409/120-B of IPC, Section 467 of IPC in alternative Section 467/120-B of IPC, Section 468 of IPC in alternative Section 468/120-B of IPC, Section 471 of IPC in alternative Section 471/120-B of IPC and Section 6(1) of Madhya Pradesh Nikshepakon Ke Hiton Ka Sanrakshan Adhiniyam, 2000 (for short "Adhiniyam, 2000") have been framed against him The prosecution story 1- The complainant Madanlal Bheel submitted a written complaint to the police that he gave Rs.2,35,000/- to Manish Patidar and Gopal Patidar to invest in the State Bank of India in the form of FDR but instead of depositing the aforesaid amount in the nationalized bank, they invested it in GND India Ltd. Company and handed him an FD certificate. Similarly, other investors also approached the various police station and lodged FIR complaining of cheating with them by the CMD and directors of the company. After attaining the maturity period when he demanded his money back with interest both of them informed him that the company had been declared bankrupt and all the CMD and directors of the company have fled away. Station House officer, Police Station Baghana started the investigation and found that Gopal Patidar and Manish Patidar were working as agents in the office of the company

Signature Not Verified Signed by: DIVYANSH SHUKLA Signing time: 18-04-2023 18:18:59

at Mandsaur. The company is owned by Satnam Singh S/o Balwant Singh Randhawa and the applicant Divesh Kumar Bajaj is one of the directors of the company. Initially, FIR was registered at crime No.604/2016 on 10.09.2016 under Section 420, 406 of IPC against Satnam Singh Randhawa, Rajesh Patidar, Divesh Kumar Bajaj (present applicant) Praveen Rajput and other agents. The investigation has revealed that a large number of investors had been cheated by the company through its director and agent resulting in the registration of several FIRs at various police stations and the owner, director and agents have been arrested. Their formal custodies were taken in this FIR. This applicant was in custody in connection with crime No.94/2016 registered at Police Station Hat pipaliya, District Dewas. After completing the investigation official report was submitted on 16.01.2021 under Section 420, 406, 409 of IPC and Section 61 of Adhiniyam, 2000. 2- The applicant was heard at the stage of charges at length and vide order dated 07.07.2022 after considering all the submissions made by the counsel appearing for the applicant, the charges as stated in the above para has been framed against him. Since the applicant denied the charges the prosecution has been called upon to produce the evidence in support of the charges hence, this revision before this Court. Submissions of applicant's counsel 3- Shri Ajay Mishra, learned Senior Advocate appearing on behalf of the applicant argued that this present applicant has wrongly been implicated as an accused in this case, he was neither director nor holding any post in the GND company to indulge in all these activities alleged in the chargesheet. In every document, the designation of the petitioner is

Signature Not Verified Signed by: DIVYANSH SHUKLA Signing time: 18-04-2023 18:18:59

written as Chartered Accountant. Shri Mishra learned senior advocate has referred to the statement of the witnesses in which no allegations have been made against the applicant. He further submitted that the complainant as well as other investors/depositors have made allegations against Manish Patidar and Gopal Patidar that he gave them the amount of Rs.2,35,000/- for depositing in the form of FDR, therefore, no charge of Section 420 IPC is made out against the petitioner. It is further submitted that the learned Court has wrongly framed the charges under Sections 467 and 468 of IPC as there is no specific allegation against the present applicant that he prepared the forged FDR while working as a director of the company.

3- It is further submitted by the learned senior advocate that the company M/s GND India Ltd. has not been made accused in this criminal case. Initially, the charge sheet was filed against Manish and Gopal but later on, the name of the present applicant has been included by filing a supplementary charge sheet on 30.07.2021. The material placed on record along with the charge sheet only shows that the petitioner was working as a Chartered Accountant of the company, since he was not holding any responsible post in the management or participating in the day-to-day business affair of the company he has wrongly been made accused. learned senior advocate urges that name of the applicant is not there in the list of the directors as supplied by the registry of the company, therefore, the charges against the applicant are liable to be quashed.

4- In support of his contention, the learned Senior Counsel has placed reliance on judgments passed by Apex Court in the case of

Signature Not Verified Signed by: DIVYANSH SHUKLA Signing time: 18-04-2023 18:18:59

Aneeta Hada v/s Godfather Travels & Tours (P) Ltd. reported in (2012) 5 SCC 661 and K.K. Ahuja v/s V.K. Vora and another reported in (2009) 10 SCC 48. The Apex Court has held that in absence of the company as an accused the directors alone cannot be prosecuted, and the prosecution of a person In-charge of the company only without arraying the company is not permissible. Shri Mishra learned senior advocate has placed reliance on judgments relating to „in absence of the company director cannot be prosecuted‟ passed by the Apex Court in the case of [i] S.K. Alagh v/s State of Uttar Pradesh and others reported in (2008) 5 SCC 662. [ii] Sharad Kumar Sanghi v/s Sangita Rane reported in (2015) 12 SCC 781 and [iii] Maksud Saiyed v/s State of Gujarat and others reported in (2008) 5 SCC 668.

5- So far as the charge under Section 420 of IPC is concerned, there is no direct allegation against this applicant that he cheated the complainant by taking his money for investment in the company. The depositor was made to believe that his money was invested in GND company in the form of FDR and the said FDR is not a forged document, therefore, Section 420 of IPC as well as Section 467 of IPC is not made out. In support of his contention, the learned senior advocate has placed reliance on a judgment passed by the Apex Court in the case of Md. Ibrahim and others v/s State of Bihar and another reported in AIR 2010 SC (Supp) 347. There is no allegation that this applicant has prepared a forged FDR given to the complainant, therefore, forgery cannot be established against the applicant and to support his contention he has placed reliance on a judgment passed by the Apex Court in the case of Sheila Sebastian v/s R. Jawaharaj and another reported in AIR

Signature Not Verified Signed by: DIVYANSH SHUKLA Signing time: 18-04-2023 18:18:59

2018 SCC 2434.

6- There is no material to establish the element of wrongful intention from inception. The money was taken by way of deposit and if the company has turned bankrupt and money could not be returned, therefore, it cannot be said that there was an element of cheating from the inception hence, Section 420 of IPC is not made out. To support his contention learned Senior Counsel has placed reliance on the judgment passed by the Apex Court in the case of Harmanpreet Singh Ahluwalia and others v/s State of Punjab and others reported in 2009 Cri. L. J. 3462.

7- Lastly, Shri Mishra learned senior advocate has relied on a judgment passed by the Apex Court in the case of Niranjan Singh v/s Jitendra Bhimraj Bijja and others reported in AIR 1990 SCC 1962 in which the Apex Court discussed the scope of Sections 227 and 228 of Cr.P.C. in it, and held that the Court is required to evaluate the material and document available on record with a view to finding out if the fact emerging therefrom taken at their face value disclose the existence of all the ingredients constituting the alleged offence. Shri Mishra learned senior advocate has also referred to the statements of Shiv Prakash Rawat, Junior Technical Assistant Registrar of the Company recorded in S.T. No.218/2016 in which he has admitted that in the documents of the GND company, the name of this application is not there as a director. Submission of the public prosecutor 8- Ms Mamta Shandilya, learned Government Advocate appearing on behalf of the respondent/State contended that while exercising the power under revision the charges are not liable to be quashed when the

Signature Not Verified Signed by: DIVYANSH SHUKLA Signing time: 18-04-2023 18:18:59

same is liable to be established by way of evidence before the trial. This Court is not required to evaluate the material in the record and appreciate as charges are not made out and the applicant is entitled to the acquittal. There are number of FIRs registered at various police stations against the directors of the company including this applicant and their agents. In the complainant, the allegations are that the complainant gave money to the agents for depositing in the State Bank but they deposited the same in the GND company and handed over FDRs to the complainant who is the rustic villager, and he was not aware as to who are the In-charge and Director of the company, therefore, initially the Name of directors are not there in the complaint but the investigation has revealed that this applicant conducted various meetings/seminars in the villages to instigate the poor villagers to deposit the money in the company in order to get a higher amount of interest. Whether the applicant was the director or C.A. or in charge of the company or holding the responsible post in the management of the company same is liable to be established by way of evidence during the trial. The fixed deposit certificates issued to the depositors are forged if they were issued with the intention not to return money to the investors. Since inception the accused had no intention to return the money hence these are foredges FDRs for which they are liable to be tried under Sections 467 and 468 of I.P.C. A large number of the innocent public have been cheated by this applicant and other accused hence, the criminal revision is liable to be dismissed. Appreciation and conclusion

9- Recently vide judgement dated 4.3.2023 the Apex Court in the

Signature Not Verified Signed by: DIVYANSH SHUKLA Signing time: 18-04-2023 18:18:59

case of CBI Vs. Aryan Singh (Criminal Appeal No. 2025/2023 ) has explained the scope of section 482 the Cr.P.C. and Art 226 of the Constitution of India in respect of the quashment of charges by conducting mini trial. Relevant paras are as under:-

4. Having gone through the impugned common judgment and order passed by the High Court quashing the criminal proceedings and discharging the accused, we are of the opinion that the High Court has exceeded in its jurisdiction in quashing the entire criminal proceedings in exercise of the limited powers under Section 482 Cr.P.C. and/or in exercise of the powers under Article 226 of the Constitution of India.

4.1 From the impugned common judgment and order passed by the High Court, it appears that the High Court has dealt with the proceedings before it, as if, the High Court was conducting a mini trial and/or the High Court was considering the applications against the judgment and order passed by the learned Trial Court on conclusion of trial. As per the cardinal principle of law, at the stage of Criminal Appeal Nos. 1025-1026 of 2023 Page 5 of 8 discharge and/or quashing of the criminal proceedings, while exercising the powers under Section 482 Cr.P.C., the Court is not required to conduct the mini trial. The High Court in the common impugned judgment and order has observed that the charges against the accused are not proved. This is not the stage where the prosecution / investigating agency is/are required to prove the charges. The charges are required to be proved during the trial on the basis of the evidence led by the prosecution / investigating agency. Therefore, the High Court has materially erred in going in detail in the allegations and the material collected during the course of the investigation against the accused, at this stage. At the stage of discharge and/or while exercising the powers under Section 482 Cr.P.C., the Court has a very limited jurisdiction and is required to consider "whether any sufficient material is available to proceed further against the accused for which the accused is required to be tried or not".

Signature Not Verified Signed by: DIVYANSH SHUKLA Signing time: 18-04-2023 18:18:59

4.2 One another reason pointed by the High Court is that the initiation of the criminal proceedings / proceedings is malicious. At this stage, it is required to be noted that the investigation was handed over to the CBI pursuant to the directions issued by the High Court. That thereafter, on conclusion of the investigation, the accused persons have been chargesheeted. Therefore, the High Court has erred in observing at this stage that the initiation of the criminal proceedings / proceedings is malicious. Whether the criminal proceedings was/were malicious or not, is not required to be considered at this stage. The same is required to be considered at the conclusion of the trial. In any case, at this stage, what is required to be considered is a prima facie case and the material collected during the course of the investigation, which warranted the accused to be tried.

5. In view of the above and for the reasons stated above, when the High Court has exceeded in its jurisdiction in quashing the entire criminal proceedings and applying the law laid down by this Court in catena of decisions on exercise of the powers at the stage of discharge and/or quashing the criminal proceedings, the impugned common judgment and order passed by the High Court quashing the criminal proceedings against the accused is unsustainable and the same deserves to be quashed and set aside.

10- In view of the above verdict this Court is having limited jurisdiction to interfere in this case. At the time of framing of the charges, the learned trial Court is only obligatory to examine whether, on the basis of the allegations in the FIR and the material collected during the investigation, prima facie charges are made out against the accused or not. If the ingredients of the charges are there and on which that the offence is said to have been made out or not it is for the prosecution to establish by way of evidence. If the ingredients of the charges are there in the charge sheet then the Court is bound to frame the charges under the Penal enactment. In this case, the complainant

Signature Not Verified Signed by: DIVYANSH SHUKLA Signing time: 18-04-2023 18:18:59

made a complaint that agents Manish Patidar and Gopal Patidar received the amount of Rs.2,35,000/- from him to deposit in the State Bank of India by way of fixed deposit but no receipt was given. After one year, they gave him 12 FDs of GND company with an assurance that his amount would be doubled in six years. In the year 2019, all the FDs became matured and he demanded the amount from Manish and Gopal but they refused to return as the company has turned bankrupt. The FIR was registered and Manish and Gopal both were arrested, they disclosed in the police custody that the GND company opened an office in Mandsaur. Satnam Singh and Praveen Rajput along with this present applicant disclosed themselves as directors of the company. The investigation also revealed that the GND company invited deposits like all the banks and finance companies without any permission or approval from RBI, the office has been opened at various places in violation of the local laws as well as RBI guidelines, therefore, the applicant along with other formed a group to cheat the public by taking their money by giving false promises and FDRs issued to them could not be used for the return of their money, therefore, from the very inception the accused persons had knowledge that they are taking this money not for returning to the investors the ingredient of cheating are there. The false assurance was given to the depositors that their money would be doubled in six years, therefore, prima facie the ingredients of Sections 420, 408, 409 and 467 of IPC are there and on the basis of which the charges have been framed The next issue that whether the applicant was a Director or In-charge or C.A. of the GND company at the relevant point of time is a matter of trial. Even if the applicant was not holding any responsible

Signature Not Verified Signed by: DIVYANSH SHUKLA Signing time: 18-04-2023 18:18:59

post like a director in the company but if he formed a group with others to cheat the public, he is liable to be prosecuted on the charges framed. This is not the only FIR registered against the applicant, there are several FIRs registered, hence any findings given by this Court, in this case, would affect the outcome of others, therefore, no case for interference is made out.

In view of the above, the present criminal revision is dismissed.

(VIVEK RUSIA) JUDGE Divyansh

Signature Not Verified Signed by: DIVYANSH SHUKLA Signing time: 18-04-2023 18:18:59