L. Shailaja vs The State Of Telangana
2022 Latest Caselaw 2317 Tel

       THE HONOURABLE SRI JUSTICE K. LAKSHMAN

             CRIMINAL PETITION No.4375 OF 2020

ORDER:

This Criminal Petition is filed under Section - 482 of the Code of

Criminal Procedure, 1973 (for short, 'the Cr.P.C.') to quash the

proceedings in Cr. No. 344 of 2020 of Nacharam Police Station, Ranga

Reddy District. The petitioners are accused Nos. 1 to 4 in the said

crime. The offences alleged against them are under Sections 420, 406

and 506 of IPC.

2. Heard Sri B,.Shiva Ram Sharma, learned counsel for the

petitioners, Sri Khaja Vizarath Ali, learned Assistant Public Prosecutor

for the 1st respondent - State and Sri Rakesh, learned counsel,

representing M/s Resu Law Office, appearing for the 2nd respondent.

Perused the record.

3. The allegations against the petitioners in the complaint dated

02.09.2020 lodged by the 2nd respondent are that the 1st petitioner/A.1 is

wife of 4th petitioner/A.4 and the 4th petitioner is father of 2nd and 3rd

petitioners/A.2 and A.3. 2nd respondent, 1st and 2nd petitioners are the

Managing Partners of M/s Seiko Polyclosures, situated at No.11-8/A-1,

Nacharam. The 1st and 2nd petitioners have resorted to several illegal

activities with selfish intention and cheated him and his another partner

who is his sister-in-law by name L.Divya, wife of L.Kranti Kumar. They

entered into partnership agreement in 2013 in respect of manufacturing

Plastic products and started business. He worked with dedication right

from the beginning and developed the company. He invested a sum of

one Crore in the said company. He also mortgaged two houses of his

parents' with the A.P. State Finance Corporation (APSFC), Abids,

Hyderabad for obtaining machinery loan, as collateral security. 1st and

2nd petitioners have started a benami company in the name and style of

'Viswin Plastic Traders' in the name of his younger brother L.Naveen

Kumar, and diverted the business of this company to it. They are

avoiding his company's transaction amounts, and doing business with

'Viswin Plastic Traders'. They did every illegal activity in the premises

of M/s Seiko Polyclosures Company. They did under-billing of the

products and avoided the monies obtained by selling the company

products to clients and diverting the cash amounts to the personal

accounts of the Petitioner Nos.2 to 4/A.2 to A.4 maintained in other

banks. The amounts obtained by selling his company products to the

clients located in several districts and other States, are being made to be

credited to their personal and other bank accounts. Thus the petitioners

have committed money laundering and havaala activities. They are

selling the company products without issuing bills directly selling to the

customers and are not showing the GST, IT and other amounts. The

petitioner Nos.2 to 4 are receiving money directly from the customers

and some times through company workers. The petitioners have not

shown the sale amount to a tune of Ten Crores and evaded the tax

payable to the Government, and thus minting black money. They are

submitting false details to the Income Tax Department and deceived the

Government. The petitioner Nos.1 and 2 committed breach of trust and

other economic offences like minting black money by evading tax.

4. It is further alleged in the complaint that one Gondi Veeranna

who is their relative had offered property as collateral security on behalf

of their company to the APSFC, he has withdrawn the said property

without obtaining consent of all the partners of the company in an illegal

way. The 4th petitioner is the chief instigator and responsible for illegal,

havaala, money laundering and deceitful activities of the company. The

Petitioner Nos.1 and 2 got him and also his younger sister-in-law

removed from the company and caused them huge financial loss and

mental agony.

5. Learned counsel for the petitioners would submit that the

contents of the complaint lack the ingredients of the offences alleged

against the petitioners herein. There is suppression of facts. The

complaint is barred by limitation. The suit vide O.S.No.691 of 2018 is

pending and the said fact is suppressed in the complaint. There is an

arbitration clause in the partnership deed and the amended partnership

deed. The petitioner Nos.3 and 4 are not even partners of the said firm.

The allegation levelled against the petitioners herein are vague and

omnibus. The 2nd respondent is trying to convert the civil proceedings

into criminal proceedings.

6. On the complaint filed under Section 200 of Cr.PC. by one

Varaprasad, learned Magistrate has referred the same to the Police,

Nacharam Police Station, who in turn registered a case in Cr.No.114 of

2019 against the 1st petitioner herein and the High Court of Andhra

Pradesh at Amaravathi has quashed the proceedings in the said crime

vide order dated 29.10.2019 in Crl.P.No.4620 of 2019 considering the

fact that there is no cheating and criminal breach of trust. With the said

submissions, he sought to quash the proceedings in the present crime

against the petitioners herein.

7. Whereas, learned counsel for the 2nd respondent would submit

that the said complaint lodged by said Varaprasad, is nothing to do with

the allegations made by the present complaint. Mere suppression of

pendency of suit vide O.S.No.691 of 2018 will not entitle the petitioners

seeking quashemnt of the proceedings in Cr.No.344 of 2020. There are

several factual aspects which requires investigation during the course of

investigation by the Investigating Officer. The petitioners herein, instead

of co-operating with the Investigating Officer by furnishing information

and documents as sought by him in concluding the investigation, filed

the present criminal petition under Section 482 of Cr.P.C. seeking to

quash the proceedings in Cr.No.344 of 2020. With the said submissions,

he sought to dismiss the present criminal petition.

8. On the complaint lodged by the 2nd respondent herein, the

Police Nacharam Police Station, have registered a case in Cr.No.344 of

2020 for the aforesaid offences.

9. Perusal of the record would reveal that petitioner Nos.1 and 2,

respondent No.2 and one L. Kranti Kumar, have joined as partners in a

partnership firm i.e. Seiko Polyclosures under a partnership deed dated

18.03.2013. The said partnership firm was constituted for the purpose of

carrying on the business of manufacturing polyclosures and other plastic

items. The 2nd respondent is having 40% share, whereas, petitioner

Nos.1 and 2 are having 20% share each in the said partnership firm.

Thereafter, they have entered into an amended partnership deed dated

13.11.2013. As per the said amended partnership deed, the 1st petitioner

is having 40%, 2nd petitioner is having 10%, the 2nd respondent is having

29% share in the said firm. As per the said amended deed, one L.Divya

w/o L.Kranti Kumar, sister-in-law of the 2nd respondent and S.Latha,

w/o S.Kamalakar, were included as partners of the said partnership firm.

10. It is relevant to note that in both the partnership deeds, there is

an arbitration clause. Perusal of the record including the counter filed by

the 2nd respondent would reveal that there are disputes between the

petitioners and the 2nd respondent with regard to affairs of the said

partnership firm. On the complaint lodged by the 2nd petitioner herein,

the very same police, have registered a case in Cr.No.457 of 2018 for

the offences under Sections 448 and 506 read with 34 of IPC. The

Investigating Officer, on completion of investigation had filed charge

sheet. The said Calendar Case is pending. The 2nd petitioner herein had

also filed a complaint under Section 200 of Cr.P.C. and the learned

Magistrate has referred the same to the very same Police, who in turn,

registered a case in Cr.No.167 of 2019 for the offences under Sections

447, 307, 406, 506 read with 120-B of IPC. After completion of

investigation, the Investigating Officer has filed final report closing the

said First Information Report.

11. The 2nd respondent had also filed a complaint under Section

200 of Cr.P.C. and the learned Magistrate has referred the said

complaint to the very same Police, who in turn, registered a case in

Cr.No.168 of 2018 against the petitioner Nos.1 and 2 for the offences

under Sections 420, 506, 403, 406 and 464 of IPC. The Investigating

Officer, on completion of investigation, laid charge sheet against the

petitioners herein and the said Calendar Case is pending.

12. In the counter, the 2nd respondent claims that the petitioner

No.1 is holding 40%, the petitioner No.2 is holding 10% and the 2nd

respondent is holding 20% share and sister-in-law of the 2nd respondent

by name L. Divya is holding 21% share in the amended partnership

firm. The petitioner Nos.1 and 2 and the 2nd respondent are the partners

from the beginning. The respondent No.2 is Managing Partner and he is

still continuing.

13. Perusal of the record would also reveal that the 1st and 2nd

petitioners herein have filed a suit vide O.S.No.691 of 2018 before the

Principal Junior civil Judge, Ranga Reddy district at L.B.Nagar, against

the 2nd respondent and his sister-in-law L.Divya for perpetual injunction

restraining them from interfering with the possession and enjoyment of

the plaintiffs over the suit schedule property i.e. M/s Seiko Polyclosures

situated at Plot No.118/A (11/8/A-1) Sy.No.50 IDA, Nacharam,

Hyderabad. Initially interim injunction was granted in I.A.No.1186 of

2018 in the said suit vide order dated 02.11.2018 and the same was later

modified as status-quo.

14. Perusal of the record would also reveal that one Vardanapu

Purushotham Vara Prasad, friend of the 2nd respondent, had filed a

complaint under Section 200 of Cr.P.C. and the learned Magistrate has

referred the same to the Police, Narsapuram Town Police Station, who

in turn, registered a case in Cr.No.114 of 2019 against the 1st petitioner

only for the offences under Section 420 of IPC. The allegation levelled

against the 1st petitioner herein in the said complaint is that she has

induced the said Varaprasad by making him to believe and invest an

amount of Rs.60 Lakhs in the said partnership firm i.e. Seiko

Polyclosures. The 1st petitioner herein has filed a petition under Section

482 of Cr.P.C. vide Crl.P.No.4620 of 2019 to quash the proceedings in

the said crime and the High Court of Andhra Pradesh at Amaravathi had

quashed the proceedings in the said crime vide order dated 29.10.2019.

15. The said facts would reveal that there are disputes between the

petitioners and the 2nd respondent with regard to the affairs of the said

firm. The above said suit vide O.S.No.691 of 2018 is pending and there

is a status-quo order.

16. As stated supra, in both the partnership deeds, there is an

arbitration clause. It appears that none of the parties have invoked the

said arbitration clause. However, in the complaint, dated 02.09.2020, the

2nd respondent has made several allegations including allegations that

the petitioner Nos.1 and 2 have removed the 2nd respondent, his sister-

in-law from the said partnership firm and also withdrew the collateral

security in respect of the said partnership firm without their consent.

The above stated crimes are also pending between the parties. Thus,

there are several factual aspects to be investigated into by the

Investigating officer during the course of investigation. The matter is at

crime stage.

17. It is relevant to note that in M/S Neeharika Infrastructure

Pvt.Ltd vs. The State Of Maharashtra1, the Apex Court held that

criminal proceedings ought not to be scuttled at the initial stage.

Quashing of a complaint should rather be an exception and a rarity than

2021 SCC OnLine SC 315

an ordinary rule. Even in Skoda Auto Volkswagen India Private

Limited Vs. The State of Uttar Pradesh2, the Apex Court referring to

the various judgments rendered by it categorically held that the High

Courts in exercise of its inherent powers under Section 482 of Cr.P.C

has to quash the proceedings in criminal cases in rarest of rare cases

with extreme caution.

18. Coming to the case on hand, it is not the rarest of the rare

case. Prima facie, the allegations needs to be considered by the

Investigating Officer during the course of investigation. Therefore, the

petitioners herein failed to make out any case to quash the proceedings

against them in the subject crime and thus, the present criminal petition

is liable to be dismissed.

19. This Court vide order dated 29.04.2021 in I.A.No.1 of 2021 in

Crl.P.No.4375 of 2020 granted stay of all further proceedings including

the arrest of the petitioners herein in the present crime pending on the

file of the Nacharam Police Station.

20. However, considering the peculiar facts and circumstances of

the case and also considering the fact that prima facie there are certain

2 AIR 2021 SC 931,

specific allegations against all the petitioners herein and that the

punishment prescribed for the offences alleged against the petitioners

herein is seven years and below seven years, this Criminal Petition is

disposed of directing the Investigating Officer in Cr.No.344 of 2020

pending on the file of the Nacharam Police Station, to follow the

procedure laid down under Section 41-A of Cr.P.C., and also the

guidelines issued by the Apex Court in Arnesh Kumar v. State of

Bihar and another3. The Investigating Officer/Station House Officer is

also directed not to arrest the petitioners till completion of investigation

and filing of final report. The petitioners shall cooperate with the

Investigating Officer, by furnishing information and documents sought

by him in completing investigation.

Consequently, miscellaneous Petitions, if any, pending, shall also stand closed.

__________________ K. LAKSHMAN, J Date:06.06.2022 Vvr.

(2014) 8 SCC 273