Madhya Pradesh High Court
Shubham vs The State Of Madhya Pradesh on 27 February, 2024
Author: Prem Narayan Singh
Bench: Prem Narayan Singh
1
IN THE HIGH COURT OF MADHYA PRADESH
AT INDORE
BEFORE
HON'BLE SHRI JUSTICE PREM NARAYAN SINGH
ON THE 27 th OF FEBRUARY, 2024
MISC. CRIMINAL CASE No. 41366 of 2023
BETWEEN:-
1. SHUBHAM S/O KISHORE TIWARI, AGED ABOUT 27
YEAR S , OCCUPATION: I.T. PROFESSONAL R/O
PANVEL NAVI MUMBAI MAHARASHTRA
(MAHARASHTRA)
2. VISHAL S/O KIRAN SHAH, AGED ABOUT 42 YEARS,
OCCUPATION: IT PROFESSIONAL PANVEL NAVI
MUMBAI MAHARASTHRA (MAHARASHTRA)
.....APPLICANTS
(BY SHRI YASH PAL RATHORE, ADVOCATE)
AND
1. THE STATE OF MADHYA PRADESH STATION
HOUSE OFFICER THROUGH POLICE STATION
KOTWALI DISTT. DHAR (MADHYA PRADESH)
2. AKHILESH S/O RAMESHWAR CHOUDHARY, AGED
ABOUT 52 YEARS, OCCUPATION: BUSINESS
NARENDRA CINEMA CAMPUS DHAR (MADHYA
PRADESH)
.....RESPONDENTS
(BY MS. VINITA DWIVEDI, PANEL LAWYER)
(BY MS. JYOTI MAHESHWARI, ADVOCATE FOR OBJECTOR)
(BY SHRI GURUMEET SINGH DANG, LEARNED COUNSEL FOR THE
RESPONDENT [R-1][INT])
This application coming on for hearing this day, the court passed the
following:
ORDER
The applicants have filed the present petition under Section 482 of the
Code of Criminal Procedure, 1973 seeking quashment of FIR bearing Crime
No. 422/2023 registered at Police Station-Kotwali District Dhar for the offence
under Sections 420, 406, 409 read with 34 of the Indian Penal Code, 1860
(hereinafter referred to as "IPC") and Section 6(1) of the M.P. Nikshepako Ke
Hito Ka Sanrakshan Adhiniyam, 2000 (hereinafter referred to as "Adhiniyam,
2000") and all further proceedings.
2. As per prosecution case, the respondent No. 2/complainant has
lodged a written complaint at Police Station Kotwali District Dhar against the
applicants alongwith four other persons that they formed a chit fund company
and obtained deposits from the depositors. In the meeting held at Shradha
Garden, Dhar, co-accused Ritesh Panchal, Director of the Company alongwith
co-accused Pankaj Solanki, Local Manager of the company explained the
investment plan of the company. The said company offered huge profit on the
investment. In its regular course of business of the company through its
employees and workers contacted the public and made them believe that if they
invest money in the scheme of company, they will be able to get three times
profit of the invested money within nine months.
3. In course of that, the complainants have deposited money to the bank
account of the said company. However, they have not returned their money as
they were assured. Ritesh Panchal, Director of the company executed a written
agreement for returning the principal amount with some benefits on 06.08.2023
and further they have also sent whatsapp message in this regard. All five
directors are connected with the conference calling who have obtained the
money but ultimately, they have denied it. Hence, the present FIR has been
lodged against them.
4. Learned counsel for the applicants has submitted that Ritesh Panchal is
Director of the company while Pankaj Solanki is Local Manager of the
company. The applicants have no concern with the company. There is no
prima-facie case against them and no legally admissible evidence against them.
They are only IT professionals supplying software to the clients. Under these
circumstances, this criminal case in the Court will be a futile exercise and mere
wastage of precious time of the Court. There is no chance of conviction of the
applicant. Hence, counsel for applicants made request before this Court for
quashing the FIR and all further proceedings in this regard by exercising the
power enshrined under Section 482 of Cr.P.C.
5. Learned counsel for the respondent as well as Government Advocate
have opposed the contentions of the applicants and submitted that the
complainants have deposited money of Rs.10,00,000/- from the hard-earned
income in the scheme of S M Trade Company in the year 2021, but they have
not been returned the money with profit. The applicants are also two Directors
of the company out of five Directors. Till now, neither the applicants have
surrendered before the Court nor tried to cooperate with the criminal
proceedings. Counsel for the respondent has also submitted some copies of the
FIRs and an FIR bearing Crime No. 304/2023 dated 13.05.2023, names of the
applicants Vishal and Shubham have been mentioned as accused. Therefore,
the prayer for quashing the FIR and all further proceedings made by the
applicants is liable to be dismissed.
6. In view of the aforesaid submissions, I have gone through the
statements recorded under Sections 161 of Cr.P.C. of Vinod, Akhilesh,
Roshan, Mahima, Anita, Praveen Kumar, Mohammadi, Suresh, Dharmendra,
Sudhir, Vijay Patel, Deep Patel, Rajesh Joshi, Rajkumar, Nilesh Patel, Rajesh,
Devendra, Hanif, Ravi, Charanjeet, Triloksingh and Aman and record available
herewith and found that all of these witnesses have made allegation against both
of the applicants Shubham and Vishal. As per statements of these witnesses,
they have tempted the investors to invest the money. As per FIR, present
applicants Shubham and Vishal are also the directors of the said company and
they are involved in cheating and forgery. They are yet to be arrested and also
the investigation is pending against them.
7. On this aspect, the law laid down by Hon'ble Apex Court in the case of
Kamaladevi Agrawal Vs. State of W.B. (2002) 1 SCC 555 , Hon'ble Apex Court
considered the scope and ambit of Section 482 of Cr.P.C. with regard to
quashment of FIR, complaint and criminal proceedings, reads as under :-
"This Court has consistently held that the
revisional or inherent powers of quashing the
proceedings at the initial stage should be exercised
sparingly and only where the allegations made in
the complaint or the FIR, even if taken it at the face
value and accepted in entirety, do not prima facie
disclose the commission of an offence. Disputed
and controversial facts cannot be made the basis
for the exercise of the jurisdiction."
8. In the case of R. Kalyani Vs. Janak C. Mehta, (2009) SCC 516,
Hon'ble Apex Court further observed that :-
Propositions of law which emerge from the said decisions are :
(1) The High Court ordinarily would not exercise its
inherent jurisdiction to quash a criminal proceeding and,
in particular, a First Information Report unless the
allegations contained therein, even if given face value
and taken to be correct in their entirety, disclosed no
cognizable offence.
(2) For the said purpose, the Court, save and except in
very exceptional circumstances, would not look to any
document relied upon by the defence.
(3) Such a power should be exercised very sparingly. If
the allegations made in the FIR disclose commission of
an offence, the court shall not go beyond the same and
pass an order in favour of the accused to hold absence
of any mens rea or actus reus.
(4) If the allegation discloses a civil dispute, the same
by itself may not be a ground to hold that the criminal
proceedings should not be allowed to continue.
9. The aforesaid legal position has been reiterated in the case of Mahesh
Chaudhary Vs. State of Rajasthan and another, (2009) 4 SCC 439.
Relevant paragraphs of the judgment are condign to quote here :-
"13. The principle providing for exercise of the
power by a High Court under Section 482 of the
Code of Criminal Procedure to quash a criminal
proceeding is well known. The court shall
ordinarily exercise the said jurisdiction, inter alia,
in the event the allegations contained in the FIR or
the Complaint Petition even if on face value are
taken to be correct in their entirety, does not
disclose commission of an offence.
14. It is also well settled that save and except very
exceptional circumstances, the court would not
look to any document relied upon by the accused in
support of his defence. Although allegations
contained in the complaint petition may disclose a
civil dispute, the same by itself may not be a
ground to hold that the criminal proceedings
should not be allowed to continue. For the purpose
of exercising its jurisdiction, the superior courts
are also required to consider as to whether the
allegations made in the FIR or Complaint Petition
fulfill the ingredients of the offences alleged
against the accused."
10. Further, the Hon'ble Apex Court in the case of State of M.P. vs.
Deepak [(2019) 13 SCC 62], reversing the order of discharging of the High
Court, has enunciated the principles which the High Courts must keep in mind
while exercising their jurisdiction under the provision. In this case, endorsing
another case of Hon'ble Apex Court in the case of Amit Kapoor vs. Ramesh
Chander [(2012) 9 SCC 460 has quoted as under:-
"27. .. At best and upon objective analysis of various
judgments of this Court, we are able to cull out some of
the principles to be considered for proper exercise of
jurisdiction, particularly, with regard to quashing of
charge either in exercise of jurisdiction under Section 397
or Section 482 of the Code or together, as the case may
be:
27.2. The Court should apply the test as to whether the
uncontroverted allegations as made from the record of the
case and the documents submitted therewith prima facie
establish the offence or not. If the allegations are so
patently absurd and inherently improbable that no prudent
person can ever reach such a conclusion and where the
basic ingredients of a criminal offence are not satisfied
then the Court may interfere.
27.3. The High Court should not unduly interfere. No
meticulous examination of the evidence is needed for
considering whether the case would end in conviction
or not at the stage of framing of charge or quashing of
charge.
27.4. Where the exercise of such power is absolutely
essential to prevent patent miscarriage of justice and
for correcting some grave error that might be
committed by the subordinate courts even in such
cases, the High Court should be loath to interfere, at
the threshold, to throttle the prosecution in exercise of
its inherent powers.
27.9. Another very significant caution that the courts have
to observe is that it cannot examine the facts, evidence and
materials on record to determine whether there is
sufficient material on the basis of which the case would
end in a conviction; the court is concerned primarily with
the allegations taken as a whole whether they will
constitute an offence and, if so, is it an abuse of the
process of court leading to injustice.
27.13. Quashing of a charge is an exception to the rule of
continuous prosecution. Where the offence is even broadly
satisfied, the Court should be more inclined to permit
continuation of prosecution rather than its quashing at
that initial stage. The Court is not expected to marshal
the records with a view to decide admissibility and
reliability of the documents or records but is an
opinion formed prima facie."
11. Again, on this aspect, the verdict of Hon'ble the Apex Court in a
recent judgment of Directorate of Enforcement Vs. Niraj Tyagi and Ors.
reported in 2024 LawSuit (SC) 112 decided on 13.02.2024, is significant.
Paras 22, 23 & 24 are worth to be referred to the context of this case :-
"22. Recently, a Three-Judge Bench in Neeharika
Infrastructure (supra) while strongly deprecating the practice of the High
Courts in staying the investigations or directing not to take coercive action
against the accused pending petitions under Section 482 of Cr.P.C., has
issued the guidelines, which may be reproduced hereinbelow for ready
reference:-
"Conclusions
33. 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
482CrPC 4 2017 (2) SCC 779 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/charge-sheet is
filed under Section 173 CrPC, while
dismissing/disposing of/not entertaining/not quashing
the criminal proceedings/complaint/FIR in exercise of
powers under Section 482CrPC and/or under Article
226 of the Constitution of India, our final conclusions
are as under:
33.1. Police has the statutory right and duty under the
relevant provisions of the Codeb of Criminal
Procedure contained in Chapter XIV of the Code to
investigate into a cognizable offence.
33.2. Courts would not thwart any investigation into
the cognizable offences.
33.3. 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.
33.4. 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).
33.5. 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.
33.6. Criminal proceedings ought not to be scuttled at
the initial stage.
33.7. Quashing of a complaint/FIR should be an
exception rather than an ordinary rule.
33.8. Ordinarily, the courts are barred from usurping
the jurisdiction of the police, since the two organs of
the State operate in two specific spheres of activities
and one ought not to tread over the other sphere.
33.9. The functions of the judiciary and the police are
complementary, not overlapping.
3 3 . 1 0 . 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.
33.11. Extraordinary and inherent powers of the
Court do not confer an arbitrary jurisdiction on
the Court to act according to its whims or
caprice.
33. 12. 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.
33.13. The power under Section 482CrPC 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.
33.14. 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
R.P. Kapur [R.P. Kapur v. State of Punjab, 1960
SCC OnLine SC 21 : AIR 1960 SC 866] and
Bhajan Lal [State of Haryana v. Bhajan Lal,
1992 Supp (1) SCC 335 : 1992 SCC (Cri) 426] ,
has the jurisdiction to quash the FIR/complaint.
33.15. 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.
33.16. 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 CrPC 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.
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 CrPC 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
t h e investigation is completed and/or till the final
report/charge-sheet is filed under Section 173
Cr.P.C., while dismissing/disposing of the quashing
petition under Section 482 CrPC and/or under Article
226 of the Constitution of India. 33.17. 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
t h e broad parameters while exercising the powers
under Section 482 CrPC 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.
33.18. 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."
23. The impugned orders passed by the High Court are in
utter disregard and in the teeth of the said guidelines issued by the
Three-Judge Bench of this Court. It was sought to be submitted
by the Learned Counsels for the respondents-accused that the
allegations made in the FIRs are of civil nature, and have been
given a colour of criminal nature. According to them, as
discernible from the record, number of proceedings had ensued
between the parties pursuant to the actions taken by the IHFL
against the complainant-borrower for the recovery of its dues
under the SARFAESI Act, and the borrower M/s Shipra after
having failed in the said proceedings had filed the complaints with
ulterior motives. We do not propose to examine the merits of the
said submissions as the writ petitions filed by the concerned
respondents-accused seeking quashing of the FIRs on such
grounds are pending for consideration before the High Court. It
would be open for the High Court to examine the merits of the
petitions and decide the same in accordance with law.
24. Without elaborating any further, suffice it to say
that judicial comity and judicial discipline demands that
higher courts should follow the law. The extraordinary and
inherent powers of the court do not confer any arbitrary
jurisdiction on the court to act according to its whims and
caprice."
12. In conspectus of the aforesaid settled legal position, extraordinary
power conferred under Section 482 of Cr.P.C. for quashing the criminal
proceedings should be exercised very sparingly and with circumspection and that
too in the rarest of rare cases. It does not confer an arbitrary jurisdiction on the
court to act according to its whim or caprice. The court will not be justified in
embarking upon an enquiry with regard to the reliability or genuineness of the
allegations made in the FIR or the complaint. Such arbitrary use of this
extraordinary inherent power enshrined under Section 482 of Cr.P.C. will be
disheartening and menacing for the whole criminal judicial system of India.
13. On due consideration of the above, legal propositions and looking to
the statement of witnesses, the facts mentioned in First Information Report and
other circumstances of the case, this Court is of the considered opinion that the
request for quashing the FIR by using extraordinary powers of this Court,
cannot be accepted. Accordingly, this M.Cr.C. is hereby dismissed.
14. Before parting, this Court clarifies that any view or observation made
herein would not be binding in any manner on the merits of the case for the
concerned trial Court while adjudicating the matter in accordance with law.
15. A copy of this order be sent to the concerned trial court for
information.
Certified Copy, as per rules.
(PREM NARAYAN SINGH)
JUDGE
Vindesh
