Narinder Singh Mehta v. State Of Chhattisgarh Home Department

Judgment

1. Heard Mr. Ratan Pandey, learned counsel appearing for the petitioner and Mr. Ashish Shukla, learned Additional Advocate General appearing for the respondents/State.

2. The present petition has been filed under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023 read with Article 226 of the Constitution of India seeking quashment of FIR No. 220/2016 registered at Police Station Gobra Nawapara, District Raipur, for the offences punishable under Sections 420, 409 and 34 of the Indian Penal Code and Section 10 of the Chhattisgarh Protection of Depositors' Interest Act, 2005, together with Chargesheet No. 03-A/2018 dated 25.09.2021, to the extent of the present petitioner, and for protection against coercive action.

3. It is not in dispute that the petitioner had earlier approached this Court by filing WPCR No. 169 of 2025 seeking protection from coercive

action in connection with another set of FIRs relating to M/s PACL Limited, which came to be dismissed by order dated 27.03.2025. The said order was challenged before the Hon'ble Supreme Court in SLP (Crl.) No. 10274 of 2025, wherein, by order dated 11.08.2025, the Hon'ble Supreme Court directed the petitioner to appear before the Investigating Officer and further directed that, in the event of his appearance and cooperation in the investigation, no coercive steps shall be taken against him. Thereafter, the petitioner also preferred CRMP No. 1599 of 2026 before this Court seeking quashment of 3 another FIR arising out of the affairs of M/s PACL Limited, which was dismissed on 23.06.2026.

4. During the course of hearing of the present petition, learned State counsel submitted that as many as 19 FIRs have been registered against the petitioner in relation to the affairs of M/s PACL Limited and that the petitioner has already been granted bail in 16 of those cases. In view of the aforesaid factual background, the present petition is being considered.

5. The petitioner has filed the present CRMP seeking for the following reliefs:- “It is therefore most respectfully and humbly prayed that this Hon'ble Court may be graciously pleased to exercise its inherent jurisdiction under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023 read with Article 226 of the Constitution of India and in exercise thereof be pleased to admit the petition, call for the records, and after hearing the parties in the matter, be further pleased to quash FIR No. 220/2016 registered at Police Station Gobra Nawapara, District Raipur, Chhattisgarh and Chargesheet No. 03-A/2018 dated 25.09.2021 filed in connection therewith, to the extent of the petitioner Narinder Singh Mehta, the same being an abuse of process of court and abuse of process of law and also in violation of the petitioner's fundamental and constitutional rights, in the peculiar factual matrix of the case and in the interest of justice. 4 It is further most respectfully prayed that pending the hearing and final disposal of this petition, this Hon'ble Court may be graciously pleased to pass an order directing Respondent No. 4 and all other police authorities in the State of Chhattisgarh not to arrest the petitioner or take any coercive action against him in connection with FIR No. 220/2016, P.S. Gobra Nawapara, District Raipur, and further directing no chargesheet or supplementary chargesheet naming the petitioner as an accused be filed in connection with the said FIR, till the final disposal of this petition, and/or pass such other orders as this Hon'ble Court may deem fit and proper in the facts and circumstances of the case, in the interest of justice.”

6. The present petition has been filed seeking quashment of FIR No. 220/2016 registered at Police Station Gobra Nawapara, District Raipur, for the offences punishable under Sections 420, 409 and 34 of the Indian Penal Code and Section 10 of the Chhattisgarh Protection of Depositors' Interest Act, 2005, along with Chargesheet No. 03-A/2018 dated 25.09.2021, insofar as it relates to the petitioner. It is the case of the petitioner that he is neither named as an accused in the FIR nor in the chargesheet and that he came to be appointed as an Independent Director of M/s PACL Limited only on 08.02.2016, after the alleged transactions forming the subject matter of the present crime had already taken place. According to him, he had no role in the collection of deposits from investors or in the affairs of the Company during the period when the alleged offences were committed. 5 ******* It is further pleaded that the petitioner had earlier approached this Court by filing WPCR No. 169 of 2025 seeking protection against coercive action in connection with two other FIRs arising out of the affairs of M/s PACL Limited. The said petition was dismissed by this Court, whereafter the petitioner preferred SLP (Crl.) No. 10274 of 2025 before the Hon'ble Supreme Court. By order dated 11.08.2025, the Hon'ble Supreme Court directed the petitioner to appear before the Investigating Officer and further ordered that, in the event of his appearance and cooperation in the investigation, no coercive steps should be taken against him. The petitioner contends that the Hon'ble Supreme Court also noticed that his role as an Independent Director was merely to assist the Justice R.M. Lodha Committee constituted pursuant to the directions of the Hon'ble Supreme Court. ******* The petitioner has further averred that he has already been acquitted in one criminal case arising out of similar allegations relating to M/s PACL Limited and that he has been granted bail in several other cases registered in different districts of the State. It is his apprehension that, despite not being named in the FIR or the chargesheet in the present case, he may be arrested and subsequently implicated through a supplementary chargesheet. On these grounds, asserting that continuation of criminal proceedings against him would amount to an abuse of the process of law, the petitioner has prayed for quashment of the FIR and the consequential proceedings to the extent they relate to him, along with protection from coercive action. 6

7. Learned counsel for the petitioner submits that the petitioner has been falsely sought to be implicated in connection with the present crime despite the admitted position that he is neither named in the FIR nor in Chargesheet No. 03-A/2018 filed after completion of investigation. It is argued that the alleged deposits, which constitute the subject matter of the prosecution, were collected between the years 2009 and 2014, whereas the petitioner was appointed as an Independent Director of M/s PACL Limited only on 08.02.2016, after the affairs of the Company had already come under the scrutiny of SEBI, the Securities Appellate Tribunal and the Hon'ble Supreme Court. According to learned counsel, the petitioner neither participated in the affairs of the Company during the relevant period nor had any role in inducing investors or collecting deposits, and, therefore, no criminal liability can be fastened upon him merely by virtue of his subsequent appointment as an Independent Director.

8. Learned counsel further submits that the petitioner was appointed only to assist the Justice R.M. Lodha Committee constituted by the Hon'ble Supreme Court for facilitating the refund of investors' money and to ensure compliance with the directions issued by the Hon'ble Supreme Court. It is contended that while disposing of SLP (Crl.) No. 10274 of 2025, the Hon'ble Supreme Court itself recorded that the petitioner was an Independent Director and that his job was merely to assist the Lodha Committee. It is argued that in view of the said observation and the direction issued by the Hon'ble Supreme Court that no coercive steps be taken against the petitioner so long as he cooperates with the investigation, the continuation of criminal proceedings against him 7 would be wholly unwarranted. Reliance has also been placed on the judgments of the Hon'ble Supreme Court in K.K. Ahuja v. V.K. Vora, (2009) 10 SCC 48; Pooja Ravinder Devidasani v. State of Maharashtra, (2014) 16 SCC 1; and Sunil Bharti Mittal v. Central Bureau of Investigation, (2015) 4 SCC 609, to contend that in the absence of specific allegations demonstrating active involvement, a Director cannot be held vicariously liable for the acts of the Company.

9. It is lastly submitted that the petitioner has already been acquitted in one criminal case arising out of an identical factual matrix and has been granted bail in several other cases registered in relation to the affairs of M/s PACL Limited. Learned counsel submits that the petitioner apprehends his arrest and implication through a supplementary chargesheet despite the absence of any material connecting him with the alleged offences. It is, therefore, contended that permitting the investigating agency to proceed against the petitioner would amount to an abuse of the process of law and would violate his rights guaranteed under Articles 14 and 21 of the Constitution of India. On these grounds, it is prayed that the present petition be allowed by quashing the FIR and the consequential proceedings insofar as they relate to the petitioner, along with protection from coercive action.

10. Learned State counsel, on the other hand, opposes the petition and submits that the present petition is devoid of merit and deserves to be dismissed. It is contended that the allegations pertain to a large-scale economic offence involving M/s PACL Limited, wherein numerous 8 investors were allegedly induced to invest their hard-earned money on the promise of lucrative returns and were subsequently cheated. According to learned State counsel, the investigation in such serious economic offences cannot be interdicted merely because the petitioner is not named in the FIR or the chargesheet, as the investigating agency is competent to proceed against any person whose complicity is disclosed during the course of further investigation. He further submits that the petitioner himself admits that as many as 19 FIRs have been registered against him in different districts of the State in relation to the affairs of M/s PACL Limited and that he has been granted bail in 16 of those cases. It is argued that the multiplicity of criminal cases demonstrates the widespread nature of the alleged fraud affecting a large number of depositors and, therefore, no exceptional circumstance exists warranting interference by this Court in exercise of its inherent jurisdiction under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023.

11. It is lastly contended that the questions regarding the petitioner's role, extent of involvement and liability are matters to be examined by the investigating agency on the basis of evidence collected during investigation and cannot be conclusively adjudicated in proceedings under Section 528 of the B.N.S.S. at this stage. It is, therefore, prayed that the present petition, being premature and devoid of merit, be dismissed.

12. We have heard learned counsel for the parties and perused the impugned FIR and document annexed with the petition. 9

13. The legal position governing the exercise of inherent jurisdiction under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023 is well settled. The said provision, corresponding to Section 482 of the Code of Criminal Procedure, 1973, confers an extraordinary and inherent jurisdiction upon the High Court, which is required to be exercised sparingly, with great caution and only to prevent abuse of the process of any Court or otherwise to secure the ends of justice. It is equally well settled that while considering a petition seeking quashment of an FIR or criminal proceedings, the High Court is not expected to embark upon a meticulous appreciation of the evidence or adjudicate disputed questions of fact. The Court is required to examine only whether the allegations contained in the FIR and the material collected during investigation, taken at their face value, prima facie disclose the commission of a cognizable offence. The mere fact that an accused disputes the allegations, relies upon documents in his defence, or asserts his innocence, would not by itself justify exercise of the inherent jurisdiction. If the allegations disclose the essential ingredients of the alleged offences and the issues raised involve factual disputes requiring appreciation of evidence, the Court would ordinarily decline to interfere, leaving such matters to be determined by the competent Court during the course of investigation or trial. Equally, the inherent jurisdiction cannot be invoked to stifle a legitimate investigation or to grant anticipatory declarations against a possible future course of investigation, unless the case falls within the well-recognized parameters warranting such extraordinary interference. 10

14. In Niharika Infrastructure Pvt. Ltd. v. State of Maharashtra and Others, (2021) SCC OnLine SC 315, the Hon'ble Supreme Court has authoritatively reiterated the well-settled principles governing the exercise of inherent jurisdiction for quashing criminal proceedings. It has been held that the power under Section 482 of the Code of Criminal Procedure, 1973 (now Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023) is of an extraordinary nature and is required to be exercised sparingly, with great circumspection and only in the rarest of rare cases. The Hon'ble Supreme Court has further observed that while considering a prayer for quashing of an FIR or criminal proceedings, the High Court is not expected to conduct a roving enquiry into the correctness, reliability or otherwise of the allegations made in the FIR or the material collected during investigation. At that stage, the Court is only required to examine whether the allegations, taken at their face value and accepted in their entirety, prima facie disclose the commission of a cognizable offence. It has further been held that the inherent jurisdiction cannot be exercised to stifle a legitimate investigation or prosecution, nor can the High Court appreciate the defence of the accused or adjudicate disputed questions of fact while exercising such jurisdiction. The Hon'ble Supreme Court has, thus, summarized the principles governing the exercise of inherent powers while considering a prayer for quashing of an FIR or criminal proceedings as under: “i) Police has the statutory right and duty under the relevantprovisions of the Code of Criminal Procedure contained in Chapter XIV of the Code to investigate into a cognizable offence; 11 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 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 12 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; 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 13 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. 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 14 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. 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.”

15. More recently, the Hon'ble Supreme Court in Pradeep Kumar Kesharwani v. State of Uttar Pradesh & Another (Criminal Appeal No. 3831 of 2025, decided on 02.09.2025), while reiterating the 15 settled principles governing the exercise of inherent jurisdiction under Section 482 of the Code of Criminal Procedure, 1973 (now Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023), has held that the power to quash criminal proceedings is an extraordinary one, to be exercised sparingly, with great caution and only in exceptional circumstances where the allegations do not disclose the commission of any cognizable offence or where continuation of the prosecution would amount to an abuse of the process of law. The Hon'ble Supreme Court has further observed that at the stage of considering a petition for quashment, the High Court is not expected to evaluate the correctness or otherwise of the allegations, undertake a meticulous appreciation of the evidence, or adjudicate disputed questions of fact. The scope of judicial scrutiny at that stage is confined to examining whether the allegations contained in the FIR and the material collected during investigation, if accepted at their face value and taken to be true in their entirety, prima facie constitute the ingredients of the alleged offences. The Apex Court has further cautioned that where the allegations disclose a prima facie case and the issues raised require appreciation of evidence, the High Court ought not to interfere by exercising its inherent jurisdiction, as such matters are required to be examined by the competent Court during the course of investigation or trial.

16. From a perusal of the impugned FIR No. 220/2016 and Chargesheet No. 03-A/2018, it is evident that the prosecution case relates to a large-scale financial fraud allegedly committed by M/s PACL Limited and its office-bearers by inducing members of the public to invest 16 money on the assurance of allotment of land and attractive returns, which were ultimately not honoured. The record further reveals that the alleged transactions pertain to the period between the years 2009 and 2014 and that, after completion of investigation, the investigating agency filed Chargesheet No. 03-A/2018 against certain named accused while continuing investigation against some others. It is true that the petitioner is neither named in the FIR nor arrayed as an accused in the chargesheet. However, it is equally well settled that mere non-mention of a person's name in the FIR or the charge-sheet does not, by itself, create an absolute bar against further investigation or against proceeding against such person if material subsequently comes to light disclosing his complicity in the commission of the alleged offences. The FIR is not expected to be an encyclopaedia containing every minute detail of the occurrence or the names of every person involved. The investigating agency is legally empowered to carry out further investigation in accordance with law and to proceed against any person whose involvement is disclosed by the material collected during such investigation. In the present case, the allegations contained in the FIR undoubtedly disclose the commission of cognizable offences relating to large-scale cheating and misappropriation of investors' money. Therefore, at this stage, this Court cannot undertake a roving enquiry into the correctness of the petitioner's defence regarding the nature of his appointment, the extent of his role as an Independent Director, or the effect of the observations made by the Hon'ble Supreme Court in SLP (Crl.) No. 10274 of 2025, as all such issues involve disputed questions of fact 17 requiring appreciation of evidence. Consequently, this Court finds that the allegations forming the basis of the impugned FIR prima facie disclose the commission of cognizable offences warranting investigation, and no case for exercise of the extraordinary inherent jurisdiction under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023 is made out at this stage.

17. Having considered the allegations contained in the impugned FIR, the material collected during the course of investigation and the rival submissions advanced by learned counsel for the parties, this Court is of the view that no case is made out for exercising the extraordinary inherent jurisdiction under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023. The FIR and the chargesheet disclose allegations relating to a large-scale financial fraud allegedly committed by M/s PACL Limited, wherein numerous investors were induced to deposit money on the promise of allotment of land and attractive returns. Though it is true that the petitioner is neither named in the FIR nor arrayed as an accused in Chargesheet No. 03-A/2018, such circumstance, by itself, cannot be treated as conclusive so as to foreclose the statutory power of further investigation, particularly when the investigating agency is empowered in law to proceed against any person whose complicity may subsequently emerge from the material collected during investigation. The petitioner's contention that he joined the Company only as an Independent Director after the alleged transactions had taken place, that his role was confined to assisting the Justice R.M. Lodha Committee and that the Hon'ble Supreme Court has made observations regarding the nature of his appointment, 18 are all matters touching upon his defence, which cannot be conclusively adjudicated in proceedings under Section 528 of the B.N.S.S. involving disputed questions of fact. Thus, at this stage, it cannot be held that continuation of the investigation or any further proceedings in accordance with law would amount to an abuse of the process of the Court warranting interference by this Court in exercise of its inherent jurisdiction.

18. The contentions advanced on behalf of the petitioner that he was appointed as an Independent Director only on 08.02.2016 after the alleged transactions had already taken place, that his role was confined merely to assisting the Justice R.M. Lodha Committee constituted pursuant to the directions of the Hon'ble Supreme Court, that he is neither named in the FIR nor in Chargesheet No. 03-A/2018, that the Hon'ble Supreme Court in SLP (Crl.) No. 10274 of 2025 granted him protection from coercive action subject to his cooperation in the investigation, and that he has been acquitted or granted bail in other cases arising out of the affairs of M/s PACL Limited, are all matters pertaining to the defence of the petitioner. These contentions involve disputed questions of fact concerning the nature and extent of the petitioner's role in the affairs of the Company and the effect of the material collected during investigation, which cannot be conclusively adjudicated while exercising the inherent jurisdiction under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023. Whether the petitioner had any role in the commission of the alleged offences, whether the material collected during investigation ultimately establishes his complicity, and what 19 evidentiary value is to be attached to the documents and circumstances relied upon by him, are matters which fall within the domain of the investigating agency and, if occasion so arises, the competent trial Court. In view of the principles laid down by the Hon'ble Supreme Court in Niharika Infrastructure Pvt. Ltd. and Pradeep Kumar Kesharwani (supra), this Court does not find any exceptional circumstance warranting exercise of its inherent jurisdiction, particularly when the allegations relate to a large-scale economic offence and the statutory power of investigation cannot be interdicted on the basis of the petitioner's defence or apprehension of future implication.

19. Accordingly, in view of the foregoing discussion and the settled principles governing the exercise of inherent jurisdiction under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023, this Court is of the considered opinion that no case is made out for quashment of the impugned FIR or the consequential proceedings. Finding no merit in the present petition, the same deserves to be and is hereby dismissed. Sd/- (Ravindra Kumar Agrawal) (Ramesh Sinha) Sd/- Judge Chief Justice