Devi and others v. Sfate of Telangana and othersl wherein it was held at Paragraph Nos

Petition under section 482 of cr.p.c praying that in the circumstances stated in the affidavit filed in support of the petition, the High court may be pleased to stay all further proceedings including appearance of the petitioner/ accused No. 13 in C.C.No. 4 0t 2007 0n the file of the lll Additionat special Judge for CBI Cases. Hyderabad Counsel for the Petitioner: Sri T. Bala Mohan Reddy Counsel for the Respondents: Sri T. Srujan Kumar Reddy, Spl. pp for CBt The Court made the following: ORDER THE HONOURABLE SMT JUSTICE JUVVADI SRIDEVI CRIMINAL REVISION CASE No.3275 OF :1018 ORDER This Crrnrrnal Revision Case is ftled by t t,) petitioner- accused No 1ll seeking to set aside the impugnetl Order dated

15.11 2018 passed rn CRL IV'| P.No.955 of 2018 r , C.C No.4 of 2007 by learrrr:c lli Adciitronal Special Judge for C : rtral Bureau of lnvestigation (CBl) Cases, Hyderabad, vrherein an applrcation filecl rrnder Section 2.39 of the Cod,r of Criminal Procedure (for sl)ort Cr P C ) seeking discl-arge of the petitioner frorn C C No 4 of 2007 , was dismissed. l he offences alleged agarnst tlre petitioner-accused No 13 are under Sectons 12A il rI?-A 471 of the lndian Penal Cr ce (for short 'lPC ) read wrth Sectrons 13(2) read with 131)(d) of the Prevention of Oorruption Act. 1988 (for short'PC I ct') 02 Flearcl Srr T.Bala Mohan Reddy, lea red counsel for the petitioner--accused and Sri T. Srujan K rrnar Reddy, learned Spec al Public Prosecutor for Centra Bureau of lnvesttgation. irerused the record .Fil ) 03 The case of the prosecution is that the petitioner_ accused No.13 applied for a housing loan from Syndicate Bank, Borabanda Branch, Hyderabad, for the purpose of purchasing a Flat bearing No.202 in Sree Towers, Anjaneya Nagar, Kukatpally, Hyderabad At the time of submittrng the applrcation, he furnished copres of incorne tax returns for the assessment years 2002 to 2005 in support of his income credentials, and also offered one surety for collateral security, who likewise submitted copies of income tax returns. The loan was sanctioned by the accused No.1 the Branch Manager of Syndicate Bank, Borabanda Branch, on the basrs of the documents submltted by the petitroner_accused No.13 Out of the sanctioned amount, a sum of Rs.4.5 lakhs was released towards interior works, and thereafter the sale deed was executed. Subsequenily, it was revealed that the petitioner_ accused No.13 had submitted false income tax returns and that the surety had arso furnished fabricated income tax returns rt rs further alleged that the accused No 1, rn coilusron wrth other accused, sanctioned the loan in favour of the pettttoner_ accused No.13 and others despite the falsity of the documents, thereby cheated Syndicate Bank, Borabancla Branch ) 3

04. Learned counsel for the petitioner su rtnits that the petitioner-accr-rsed No 13 is nothing to do witl- the alleged offences The learned trial Judge erred ln d snissing the discharge petrtron filed by the petitioner. Bz sing on the statement of LW8 that the petitioner had su rrnitted false income tax returns, the petitioner has been imp t<;ated in the present But the statement of LWB does not (i5slos;e the name of the petitioner'accu sed No 1 3 lt is conter led that no dishonest or fraudulent intention can be attril',Ltted to the petitioner-accused No 13 The petitioner-accuseI No.'1 3 has repaid nis loan anrounl and the bank issued no c Je certificate in favour of the petitioner-accused No.13. Lea ned counsel also submits that the proceedings against accu:,ed No.10 in C C No 4 ol 2-A01' were quashed by this Court vidr order dated 06032025 rn Crrminal Petition No 12489 of 2)11, on the ground of mistaken identity. With the above subm ssions, while praying for ttre quashnrent of crrrninal proceedin;r;, he relied upon a decision of the Honourable Supreme 6oud rn K.Bharthi 4 F! Devi and others v. Sfate of Telangana and othersl wherein it was held at Paragraph Nos.31, 34 & 35 that: "31. lt could thus be seen that this Court reiterates the position that the criminal cases ttavtng overuthelntingly and predominan y crvit cha!-acter. pafticularly those arising out of cornntercial transactions or arising out of matrimonnl relationship or family dlspules shoutd be quashed when the parties have resolved their entire disputes among themselves. 3-4 The facts in rc presenf case aro similar to ta facts in the case of Sadhu Ram Singla and others (supra) wherein a dispute between thi borrower and the Bank '.,tas set ed. ln the present ca.se a/so. undisputedly the FIR end the chargesheet are peftaining to lhe dispute concerning the loan transaction availed by the accused persons on one hand and te Bank on lhe other hand Admitteclly, the Bank and the accused persons have set ed the matter. Apaft from the earli B a n k e i t h e r t h ro u g h r, :: ;:' fr::', ;f; " i lii"f:.! l: (EMls) or sale of the r,tortgaged prcpeftrcs. the bottowers have pt611l art amount of Rs.3.gA.00.A00/ under OTS After receipt ot' the amount under OTS the Bank had also decided to close the loan accounl. The dispute invotvecj predominan y had oveftures of a civil drspute

35. Apaft front that. it is furlher to be noted lhat itl view of the set ement between the parties h the proceedings before the DRT, the possibility of conviction is remote and bleak. tn ou, ,ie*, continua.tiln of the criminal proceedings woutd put the accused to great oppression and prejudice.,, lvtANU/sC/1083/2024 5 05 [:Llrthr,'r, he relred upon a dectsion n l,mit Kapoor Ramesh Chander and others2 wherein :he Hon'ble Supreme Court held at Paragraph No.19 that ''19. Havtrtg r/rscusscd l/re scope of jurisdiction , rder these twc provlsions. r e., Secllon 397 and Sr ;'iorl 482 of the Code and the fine line of jurisdic ional distinctton. now rt will be appropriate Sor xs 16 :ttlist the principles with reference to which the ( ) ttts should exerase srrch lurisdictioD However. it r rtot ortly dilf tt:ttlt ltu[ ts inhu L,-rttly ttnpossible to state \t/tth prcciston such pnttciplcs Al bcst and ttpon objt:'rve artalysrs of various ludgments of tltis Court, w, are able to cull ottt sonc of the principles tr. be considert:d for proper exercise of jurisdi t,on, parlicular ly, with regard to qLt.tshitlg of charge t ilher in exerc:se of .lurtsdtctton under Sectiort 39' or Secllon 482 of thc Codc or together. as the case r,ttty 1) Thottgh there are no limits of the powers c the Court under Secliorr 482 of the Code bul the mor ' lhe power tne rnctre: duc ct:rc arrl cautiott is t' be exercist:cl in irtvoktng tltcsc potvers. f he pow r of quashrngl crrmrnal proceerlings. parlicularly. llrc charge framed in terms of Scction 228 of the L:ode should De exercised very sparingly and v rith circumspc-t:trort anrl [hal too iu lhe rarest of r tre cases. 2) The Courl shortld apply lhc tesl as to whethe 'he uncontroveftcd allegattons as made from the re ; td of the case and the documents submitted then v,ith pnma fttce eslab/lsh the offence or not. l[ he allegatictns an: so Dalently absurd and inherntly intprobable lltat Do prurlcnl person caLt evet r:.tch ' N4qNu/scloza6t2lt: .-\--r such a conclusion and where the basic ingredients of a criminal offence are not satisfied then the Couft may interfere. 3) The Higlt Court should not uriduly jnteiere, No meliculous examination of the evidence rs needed for considering whether lhe case would end in conviction or not at the slage of framing of charge or quashing of charge. 4) Where lhe exercise of such power is absolutely essent/a/ lo prevenl patent miscarriage of justice and for correcting some grave error that might be committed by the subordinate courls even in such casc,s. lhe Hiqh Court should be loathe to inleiere. at the lhreshold. to tllrottte lhc prosecution irt exerctsc of its inherenl powcrs 5) Where there is an express tegal bar enacted in any of the provisions of the Code or any specific law in force to lhe very iniliation or institution and continuance of such cnnttnal proceedngs. suc!-t a bar is ntended lo provicle specific protection to an accused. 6) The Courl has a duty to balance the freecjom of a person and the right of the complainant or prosecution to investigate and prosecute the offender. 7) The process of the Coutl cannot be permitted to be used for an oblique or ultimate/ulterior purpose. 8) Where lhe allegations made and as they appeare(j from the tecord ancl docuntents annexed tharewith to predominantly gMe nsa ancl constrtute a 'civil wrong' with no 'element of criminality' and does not satisfy the basic ingredients of a criminal offence, the Coud may be justified in quashing the charge. Even in such cases, lhe Court would not embark upon the critical analysis of the evidence. 9) Another very significant caution that the cr have to observe is that tt canrtot examine the f' eviclence ,cnd ntaterials ort rccord lo detet ,.uhether t/tcre ls sLtfficienl matenal ort lhe ba.s, tthtch the case would end tn a conviction the CoL concernecl pnmarily with the allegations taken , whole whether they will constitute an offence ar so. ls lt an abuse of the process of cotrrl leadtr tnjusticc ti ris c ls, I tt)e ;of n/s 1if 10) lt rs ncrther neccssary tDr ts the coui called L i:cn to hold a full-fledged enquiry or lo appret tate evidence collected by the investigating agencie: to find out whether itis a case of acquitlal or conviclt 'rt. 11) Whetc allegaticttts givc rrse !o a crvtl clatnt a'td also arnortnl to an offence rnercly bccause tt ':tvil claim is ntainlairtable. does not rnean thai a crtr' ittal complaint cannot be maintarned. 12) tn exercise of ils iurisdictiort under Section 228 artd/or ttnlcr Secltott 182 lhc Cottrl canno( takt-'ittto consrclct a'Dt t exk)rnal matcrids qtvctt by art accr sed for rcachrrg the cottclttsiort thal no offence ',as dlsc/osed or that there was posstbility of his acqL, ttal. The Court has lo corlstde r the record and docltnt )t tts annexed tvith by the prosecutiort 13) Quashing of a charge is art t:xccptiott to tltr: 'trle of continuotts prosecutiott Where the offence ts r ven broadly sttttstied, the Courl shottlcl lse more incltnt r) to permit continuation of prosecutiort rather that lts quashinq at that initial stage The Court is ttot expected t1t rnarshol the recorcls with a vicw to dr, :tCe admissibil,tv an(l rcltabllly rtf lltc tlocuntertl: or records bt,tL ts an oprttion fonnacl pntna facte. 14) Where the charge-sheet, repoft under Ser tn 173(2) of the Code. suffers from fundantental l:gal \ \l - B defects, the Couft may be well within rts jurrsclictrcn to frame a charge. 1 5) Coupled with any or alt of the. above. where the Courl finds that it woutd amount to abLtse o/ process of the Code or that tntercst ot justice favours, othervvise it may quash the charge. The power is to be exercised ex debito justitiae, r.e. to clo reat and substantial lustice for administration of which atone the courls exist.' 06 On the other hand, learned Special public Prosecutor appearing for the respondent contended that there are triable issues and factual aspects to be examined by the learned trial Court and lt rs irot a fit case to drscharge the petitioner at this juncture and the matter is to be decided after conducting trial by the learned tnal Court and prayed to dismiss this Criminal Petition

07. On a careful perusal of the record, it is evident that the petitioner was initially summoned as a witness under Section '160 of Cr P C and was subsequenily arrayed as an accused solely on the basis of the statement of LWg The principal link relied upon by the prosecution, as noticed in the petition, rs the statement of LW B to the effect that the rncome tax returns submitted were false. The offences alleged against the petitioner-accused No 13 are under Sections 120-F . 420 g and 471 of IPC As seen from the statement of L\ V3 the name of the petitione r-accused No 13 was not found I lowever. the staternent of LW8 does not specifrcally attrr rrrte to the petrtioner-accused No 13 either the authors rrp or the fabrication of the alleged income tax returns [Vlor :cver' if any false income tax returns were in fact filed, the r I atter would appropriately fall within the jurisdiction of the competent authorities under the lncome Tax Act to take nece;r;ary action. The mere fact that a document in the loi r file was subsequently found to be false, in the absence rl any direct materral estab IShing that the petitioner-accusec No.13 had knowledge of such falsity at the time of its submiss on, does not satisfy the essential ingredients of the aforesaid :tences. A bald allegation that false documents were submitti c along with the loan applicatron, without clear, cogent, ? rd credible evidence to demonstrate that the petitioner rndividually participated in such fabrication with the requisite rens rea, is insuflicient to fasten criminal liability upon th I petitioner- accused No.13 10 -l 08 lt is important to note that the petrtioner repaid the loan amount and obtained a ,'No-Due Certificate,, from the Bank. Further, having considered the record. the dispute rn rts essence pertains to a loan transaction which is a commercral matter between a borrower and the Bank. The claims raised, documents produced and the reliefs sought are primarily of commercial character The Hon ble Supreme Court rn K. Bharthi Devi's case cited supra, has reiterated that where the dispute is predominantly civil or commercial character and the parties have settled or a prrnla facie case of criminality is not made out, continuation of crimrnal proceedings would be an abuse of process.

09. In view of the aforesard facts and circumstances, and having regard to the well-settled principles of law enunciated by the Hon'ble Supreine Court in the decisions referred to supra, and further taking into account the fact that the entire loan amount has already been repaid by the petitioner-accused No.13 and that a ,No Due Ce(ificate, has been issued by the concerned Bank, thrs Court is of the considered opinion that, in the absence of any prima facie 11 rncnmrnating nraterial identifying the petitroner-ac ;Lrsed No.13 as the fabricator or conscious user of the forger income tax returns. the continuation of criminal prosecution :tgainst him would amount to an abuse of the process of la 'a' lt is also evrdent that the learned trial Court has failed 1o examine whether the allegations contained in the charge s heet, even if taken at their face value, disclose the essential I llredients of the offences a leged against the petitioner. ln tha' view of the matter, the impugned order passed by the learnec t-ial Court is liable to be set aside and the consequential 5 roceedings against the petrtioner-accused No 13 are hereby qr zrshed lO Accordingly, this Criminal Revisic t Case is allowed The rrrpugned order dated 15 11 201 I passed tn Crl tvl P No 955 of 2018 in C.C No.4 of 2O07 by tl e learned lll Additional Special Judge for Central Bureau of lrtvestigation (CBl) Cases, tlyderabad, is hereby set aside Clrsequently, the petrtioner-accused No.13 is discharged frorr .he alleged offences, and the consequential proceedings agi irrst htm are hereby quashed 1? As a sequel, pending miscellaneous applications, if any, shall stand closed //TRUE COPY// SD/. K. AMMAJ EPUTY REGIS CTION OFFICER To,

1. The lll Additional Special Judge for CBI Cases, Hyderabad. 2. Two CCs to lhe Public Prosecutor, High Court for the State of Telangana at Hyderabad. [OUT]

3. One CC to Sri T. Bala Mohan Reddy, Advocate IOPUC] 4. Two CD Copies VH /. I \, ; \. .-, \1.1)t '+- -l * I '.:- -i: 1 4 :IrlT 2[25 .- r ..:)'' ':,>' HIGH COURT DATED: 2410912025 ORDER CRLRC.No.3275 of 2018 ALLOWING CRL.R.C { $