Writ Petition No. 30657 of 2024 · The High Court
Case Details
1 Reserved on : 06.03.2025 Pronounced on : 17.03.2025 R IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 17th DAY OF MARCH, 2025 BEFORE THE HON'BLE MR. JUSTICE M. NAGAPRASANNA WRIT PETITION No.30657 OF 2024 (GM – RES) BETWEEN: 1 . SRI C.N.GOVINDARAJU MANAGING DIRECTOR OF M/S. VAISHNAVI INFRASTRUCTURE PVT. LTD., S/O C.G.NARAYANASWAMY NAIDU AGED ABOUT 60 YEARS O/A NO.2/2, WALTON ROAD OFF. VITTAL MALLYA ROAD BENGALURU – 560 001. 2 . SRI RAWAL HANUMANTH SINGH AUTHORIZED SIGNATORY OF M/S. SMART WORKS COWORKING SPACES LTD., AGED ABOUT 45 YEARS S/O BIRENDRA SINGH FLAT NO.108, 1ST FLOOR NO.82, SHARANYA ARCADE APTS SARJAPURA ROAD, KAIKONDAHALLI BENGALURU – 560 035. (BY SRI PRABHULING K.NAVADGI, SR. ADVOCATE FOR SMT. SANJEEVINI PRABHULING NAVADGI, ADVOCATE) ... PETITIONERS 2 AND: 1 . STATE OF KARNATAKA REPRESENTED BY STATION HOUSE OFFICER BELLANDUR POLICE STATION REPRESENTED BY SPP HIGH COURT OF KARNATAKA BENGALURU – 560 001. 2 . KANTHA REDDY S/O KRISHNA REDDY RESIDING AT NO.31/1ST AVENUE SHUBH ENCLAVE, OUTER RING ROAD HARALUR ROAD, BENGALURU – 560 102. ... RESPONDENTS (BY SRI B.N.JAGADEESHA, ADDL. SPP FOR R1; SRI RAVI B.NAIK, SR. ADVOCATE FOR SRI K.B.MONESH KUMAR, ADVOCATE FOR R2) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA AND SECTION 528 OF THE BARATIYA NAGARIKA SURAKSHA SANHITA PRAYING TO SET ASIDE THE ORDER DTD 26.10.2024 IN P.C.R NO. 11817/2024 FILED BEFORE THE 3RD ADDL. CMM COURT AT BENGALURU DIRECTING FOR INVESTIGATION VIDE ANNEXURE-C; QUASH THE FIR DTD 30.10.2024 REGISTERED BY THE BELLANDAUR POLICE STATION IN CR. NO. 0733/24, RECEIVED FROM MR. KANTHA REDDY, FOR OFFENCES PUNISHABLE UNDER SEC 316, 318, 336 AND 340 OF THE BHARTIYA NYAYA SANHITA, 2023 VIDE ANNEXURE-A AND ETC., THIS WRIT PETITION HAVING BEEN HEARD AND RESERVED FOR ORDERS ON 06.03.2025, COMING ON FOR PRONOUNCEMENT THIS DAY, THE COURT MADE THE FOLLOWING:- 3 CORAM: THE HON'BLE MR JUSTICE M.NAGAPRASANNA CAV ORDER The petitioners/accused Nos. 1 and 2 are at the doors of this Court calling in question registration of a crime in Crime No.733 of 2024, for offences punishable under Sections 316, 318, 336 and 340 of BNS, by Bellanduru Police Station arising out of PCR No.11817 of 2024, pending before the III Additional Chief Metropolitan Magistrate, Bengaluru. 2. Heard Sri Prabhuling K.Navadgi, learned senior counsel appearing for
Legal Reasoning
the petitioners, Sri B.N.Jagadeesha, learned Additional State Public Prosecutor for respondent No.1 and Sri Ravi B.Naik, learned senior counsel for Sri K.B.Mounesh Kumar, learned counsel appearing for respondent No.2. 3. Facts, in brief, germane are as follows:- The 2nd respondent is the complainant. The complainant is said to be owning certain lands in and around the city of Bengaluru. He enters into a Joint Development Agreement (‘JDA’) with one 4 M/s.Vaishnavi Infrastructure Private Limited on 24-01-2018. Pursuant to the JDA for the purpose of construction or development of infrastructure, an allocation agreement dated 13-06-2019 is entered into by the land owners and the developer. In furtherance of the said agreement, another agreement comes to be registered for division of the area pursuant to development. Pursuant to the execution of the said agreement, another agreement of lease was executed for the north tower of the project. Several lease deeds have emerged thereafter, and the dispute between the two arose with regard to payment of money. The petitioner No.1 invoking Section 9 of the Arbitration and Conciliation Act approached the concerned Court in Commercial AA No.350 of 2023. Certain injunctive orders are passed in the said commercial AA against the land owners. It is the case of the petitioners that despite the land owners being injuncted, they always created problem for the peaceful functioning or possession of the area, which was to be owned by the developer. During the pendency of the aforesaid civil proceedings, a crime in Crime No.733 of 2024 comes to be registered on a private complaint made by the 2nd respondent against these petitioners for the aforesaid offences. The Police then 5 issued a notice under Section 35(3) of the BNSS seeking presence of the petitioners for investigation. It is then the subject petition is preferred and certain protective orders are passed. 4. The learned senior counsel appearing for the petitioners would vehemently contend that the issue in the lis is purely civil in nature. The crime is registered for the purpose of recovery of money. It is clearly impermissible in law on plethora of judgments rendered by the Apex court. It is his case that criminal law cannot be and should not be set into motion in cases, which are purely civil in nature. He would submit that on the same issue, there are several civil proceedings instituted against the petitioners or by the petitioners against the 2nd respondent. He would, therefore, submit that the proceedings should be quashed. 5. Per contra, the learned counsel Sri Mounesh Kumar representing the 2nd respondent would vehemently refute the submissions of the learned senior counsel. He would contend that in the first blush, it may look like a civil transaction between the two. No doubt, the petitioners have instituted several proceedings 6 including invoking Section 9 of the Arbitration and Conciliation Act. That does not mean that offences are not made out. The offences, according to the learned counsel for the 2nd respondent is, deceitfully using the portion of the property belonging to the complainant; leasing it out to third parties without the consent of the complainant and receiving huge sum of money of ₹8/- crores. He would submit that if this cannot be alleged of criminal breach of trust or cheating, there cannot be better illustration. 6. The matter was heard and reserved on 20-01-2025. The matter was again moved on the score that the Apex Court has rendered its judgment in OM PRAKASH AMBADKAR v. STATE OF MAHARASHTRA (2025 SCC OnLine SC 238), and therefore, on that score the petition should be allowed. The matter was re-listed and heard further. Both the learned counsel appearing for the petitioners and the respondents would agree that the procedure followed by the concerned Court is contrary to what the Apex Court has held. But, the learned counsel for the complainant further emphasized that it is a clear case of criminal breach of trust. The matter was again re-reserved. 7 7. I have given my anxious consideration to the submissions made by the respective learned counsel and have perused the material on record. 8. The afore-narrated facts are not in dispute. Agreements between the complainant and the petitioners galore. The issue springs from a JDA finally entered into in the year 2018. Several other agreements have sprung between the two. Dispute arose with regard to sharing of space in the Smartworks Co-working Spaces developed by the petitioners, the office bearers of the company. 9. It is the case of the learned senior counsel for the petitioners that having invoked arbitration clause, it is not open to the 2nd respondent to set the criminal law into motion. According to the learned counsel for the 2nd respondent/ complainant the deceit lies in usurping the area allotted to the complainant. The area allocation reads as follows: 8 “AREA ALLOTTED TO THE SHARE OF SECOND PARTY/ DEVELOPER M/s VAISHNAVI INFRASTRUCTURE PRIVATE LIMITED. Unit/portion of the Commercial Office in North Tower total Super Built 111380 sq.ft. comprising of unit/portion of the office space to First Floor and entire office space in Fourth Floor. Seventh Floor and Eight Floor and in South Tower measuring Super Built area 258849 sq.ft. comprising of unit/portion office space in Ground, entire office space in 4th, 5th, 6th, 7th, 8th, 9th and 10th in all totally measuring 370229 sq.ft. with proportionate share in common area and open Terrace Area in the Commercial Building “VAISHNAVI TECH PARK” together with proportionate undivided share right, right title and interest and ownership in the schedule property……” In the agreement description towerwise is also entered into. In the agreements entered into between the two, north tower and south tower are divided. North tower is said to have fallen to the share of the complainant as obtaining in the agreement. Clauses III and IV of the agreement read as follows: “III. Demised Premises shall mean an area admeasuring 3,67,299 sq.ft. plus Amenity Space of 28,644 sq.ft. total of 3,95,944 sq.ft. (South tower) together with 395 (Three Hundred and Ninety-five) 4 wheelers parking spaces and also together with the installations, fittings, fixtures provided thereat by the LESSORS as also together with the other Common Areas, Amenities, Facilities, Easements attached therewith (more fully mentioned and described in Schedule-A. 9 IV. AMENITY SPACE means and includes: The Area earmarked for the Amenity Space belongs to the South Tower and North Tower. Breakup of the areas between blocks and Amenity Space is as below: North Tower South Tower 3,03,934 3,95,944 % 43 57 Central Tower 21,988 28,644” The allegation now is that, in the space belonging to the complainant the petitioners enter into a lease with third parties and have made huge gains out of it. The gains according to the complainant is to the tune of ₹8/- crores. This, according to the learned counsel for the complainant, would clearly amount to breach of trust. The submission sounds acceptance. Though there are several proceedings between the petitioners and the 2nd respondent, the offences are prima facie met against the petitioners. The offences alleged are the ones punishable under Sections 316, 318, 336 and 340 of BNS. They read as follows: “316. Criminal breach of trust.—(1) Whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharged, or of any legal contract, express or implied, which he has 10 made touching the discharge of such trust, or wilfully suffers any other person so to do, commits criminal breach of trust. Explanation 1.—A person, being an employer of an establishment whether exempted under Section 17 of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (19 of 1952) or not who deducts the employee's contribution from the wages payable to the employee for credit to a Provident Fund or Family Pension Fund established by any law for the time being in force, shall be deemed to have been entrusted with the amount of the contribution so deducted by him and if he makes default in the payment of such contribution to the said Fund in violation of the said law, shall be deemed to have dishonestly used the amount of the said contribution in violation of a direction of law as aforesaid. Explanation 2.—A person, being an employer, who deducts the employees' contribution from the wages payable to the employee for credit to the Employees' State Insurance Fund held and administered by the Employees' State Insurance Corporation established under the Employees' State Insurance Act, 1948 (34 of 1948) shall be deemed to have been entrusted with the amount of the contribution so deducted by him and if he makes default in the payment of such contribution to the said Fund in violation of the said Act, shall be deemed to have dishonestly used the amount of the said contribution in violation of a direction of law as aforesaid. Illustrations (a) A, being executor to the will of a deceased person, dishonestly disobeys the law which directs him to the will, and divide appropriates them to his own use. A has committed criminal breach of trust. the effects according to (b) A is a warehouse-keeper Z going on a journey, entrusts his furniture to A, under a contract that it shall be returned on payment of a stipulated sum for warehouse room. A dishonestly sells the goods. A has committed criminal breach of trust. 11 (c) A, residing in Kolkata, is agent for Z, residing at Delhi. There is an express or implied contract between A and Z, that all sums remitted by Z to A shall be invested by A, according to Z's direction. Z remits one lakh of rupees to A, with directions to A to invest the same in the company's paper. A dishonestly disobeys directions and employs the money in his own business. A has committed criminal breach of trust. (d) But if A, in illustration (c), not dishonestly but in good faith, believing that it will be more for Z's advantage to hold shares in the Bank of Bengal, disobeys Z's directions, and buys shares in the Bank of Bengal, for Z, instead of buying company's paper, here, though Z should suffer loss, and should be entitled to bring a civil action against A, on account of that loss, yet A, not having acted dishonestly, has not committed criminal breach of trust. (e) A, a revenue officer, is entrusted with public money and is either directed by law, or bound by a contract, express or implied, with the Government, to pay into a certain treasury all the public money which he holds. A dishonestly appropriates the money. A has committed criminal breach of trust. (f) A, a carrier, is entrusted by Z with property to be carried by land or by water. A dishonestly misappropriates the property. A has committed criminal breach of trust. (2) Whoever commits criminal breach of trust shall be punished with imprisonment of either description for a term which may extend to five years, or with fine, or with both. (3) Whoever, being entrusted with property as a carrier, wharfinger or warehouse-keeper, commits criminal breach of trust in respect of such property, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine. 12 (4) Whoever, being a clerk or servant or employed as a clerk or servant, and being in any manner entrusted in such capacity with property, or with any dominion over property, commits criminal breach of trust in respect of that property, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine. (5) Whoever, being in any manner entrusted with property, or with any dominion over property in his capacity of a public servant or in the way of his business as a banker, merchant, factor, broker, attorney or agent commits criminal breach of trust in respect of that property, shall be punished with imprisonment for life, or with imprisonment of either description for a term which may extend to ten years, and shall also be liable to fine. … … … 318. Cheating.—(1) Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces the person so deceived to do or omit to do anything which he would not do or omit if he were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, mind, reputation or property, is said to cheat. Explanation.—A dishonest concealment of facts is a deception within the meaning of this section. Illustrations (a) A, by falsely pretending to be in the Civil Service, intentionally deceives Z, and thus dishonestly induces Z to let him have on credit goods for which he does not mean to pay. A cheats. (b) A, by putting a counterfeit mark on an article, intentionally deceives Z into a belief that this article was made by a certain celebrated manufacturer, and thus dishonestly induces Z to buy and pay for the article. A cheats. 13 (c) A, by exhibiting to Z a false sample of an article intentionally deceives Z into believing that the article corresponds with the sample, and thereby dishonestly induces Z to buy and pay for the article. A cheats. (d) A, by tendering in payment for an article a bill on a house with which A keeps no money, and by which A expects that the bill will be dishonoured, intentionally deceives Z, and thereby dishonestly induces Z to deliver the article, intending not to pay for it. A cheats. (e) A, by pledging as diamonds articles which he knows are not diamonds, intentionally deceives Z, and thereby dishonestly induces Z to lend money. A cheats. (f) A intentionally deceives Z into a belief that A means to repay any money that Z may lend to him and thereby dishonestly induces Z to lend him money, A not intending to repay it. A cheats. (g) A intentionally deceives Z into a belief that A means to deliver to Z a certain quantity of indigo plant which he does not intend to deliver, and thereby dishonestly induces Z to advance money upon the faith of such delivery. A cheats; but if A, at the time of obtaining the money, intends to deliver the indigo plant, and afterwards breaks his contract and does not deliver it, he does not cheat, but is liable only to a civil action for breach of contract. (h) A intentionally deceives Z into a belief that A has performed A's part of a contract made with Z, which he has not performed, and thereby dishonestly induces Z to pay money. A cheats. (i) A sells and conveys an estate to B. A, knowing that in consequence of such sale he has no right to the property, sells or mortgages the same to Z, without disclosing the fact of the previous sale and conveyance to B, and receives the purchase or mortgage money from Z. A cheats. 14 (2) Whoever cheats shall be punished with imprisonment of either description for a term which may extend to three years, or with fine, or with both. (3) Whoever cheats with the knowledge that he is likely thereby to cause wrongful loss to a person whose interest in the transaction to which the cheating relates, he was bound, either by law, or by a legal contract, to protect, shall be punished with imprisonment of either description for a term which may extend to five years, or with fine, or with both. (4) Whoever cheats and thereby dishonestly induces the person deceived to deliver any property to any person, or to make, alter or destroy the whole or any part of a valuable security, or anything which is signed or sealed, and which is capable of being converted into a valuable security, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine. … … … 336. Forgery.—(1) Whoever makes any false document or false electronic record or part of a document or electronic record, with intent to cause damage or injury, to the public or to any person, or to support any claim or title, or to cause any person to part with property, or to enter into any express or implied contract, or with intent to commit fraud or that fraud may be committed, commits forgery. (2) Whoever commits forgery shall be punished with imprisonment of either description for a term which may extend to two years, or with fine, or with both. (3) Whoever commits forgery, intending that the document or electronic record forged shall be used for the purpose of cheating, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine. (4) Whoever commits forgery, intending that the document or electronic record forged shall harm the 15 reputation of any party, or knowing that it is likely to be used for that purpose, shall be punished with imprisonment of either description for a term which may extend to three years, and shall also be liable to fine. … … … 340. Forged document or electronic record and using it as genuine.—(1) A false document or electronic record made wholly or in part by forgery is designated a forged document or electronic record. (2) Whoever fraudulently or dishonestly uses as genuine any document or electronic record which he knows or has reason to believe to be a forged document or electronic record, shall be punished in the same manner as if he had forged such document or electronic record.” Section 316 of the BNS deals with criminal breach of trust, which is Section 406 of the IPC, the earlier regime. It punishes a person who is entrusted with the property, but dishonestly converts it to his own use is said to have indulged in criminal breach of trust. Section 318 deals with cheating. Section 336 deals with forgery and Section 340 using a forged document as genuine. While Section 316 is prima facie made out in the case at hand, for the other offences investigation in the least is required. 10. The matter is at the stage of investigation. Generally, this Court unless finds anything of sterling quality would not interfere with the seriously disputed questions of fact as it would run foul of 16 the judgment of the Apex Court in the case of KAPTAN SINGH v. STATE OF UTTAR PRADESH1, wherein it is held as follows: “….. …. …. 9.1. At the outset, it is required to be noted that in the present case the High Court in exercise of powers under Section 482 CrPC has quashed the criminal proceedings for the offences under Sections 147, 148, 149, 406, 329 and 386 IPC. It is required to be noted that when the High Court in exercise of powers under Section 482 CrPC quashed the criminal proceedings, by the time the investigating officer after recording the statement of the witnesses, statement of the complainant and collecting the evidence from the incident place and after taking statement of the independent witnesses and even statement of the accused persons, has filed the charge-sheet before the learned Magistrate for the offences under Sections 147, 148, 149, 406, 329 and 386 IPC and even the learned Magistrate also took the cognizance. From the impugned judgment and order [RadheyShyam Gupta v. State of U.P., 2020 SCC OnLine All 914] passed by the High Court, it does not appear that the High Court took into consideration the material collected during the investigation/inquiry and even the statements recorded. If the petition under Section 482 CrPC was at the stage of FIR in that case the allegations in the FIR/complaint only are required to be considered and whether a cognizable offence is disclosed or not is required to be considered. However, thereafter when the statements are recorded, evidence is collected and the charge-sheet is filed after conclusion of the investigation/inquiry the matter stands on different footing and the Court is required to consider the material/evidence collected during the investigation. Even at this stage also, as observed and held by this Court in a catena of decisions, the High Court is not required to go into the merits of the allegations and/or enter into the merits of the case as if the High Court is exercising the appellate jurisdiction and/or conducting the trial. As held by this Court in DineshbhaiChandubhai Patel [DineshbhaiChandubhai Patel v. State of Gujarat, (2018) 3 SCC 104 : (2018) 1 SCC (Cri) 683] in order to examine as to whether factual contents of FIR disclose any cognizable offence or not, the High Court cannot act like the investigating agency nor can exercise the powers like an appellate court. It is further observed and held that that question is required to be examined keeping in view, the contents of FIR and prima facie material, if any, requiring no proof. At such stage, the High Court cannot 1 (2021) 9 SCC 35 17 appreciate evidence nor can it draw its own inferences from contents of FIR and material relied on. It is further observed it is more so, when the material relied on is disputed. It is further observed that in such a situation, it becomes the job of the investigating authority at such stage to probe and then of the court to examine questions once the charge-sheet is filed along with such material as to how far and to what extent reliance can be placed on such material. 9.2. In DhruvaramMurlidhar Sonar [DhruvaramMurlidhar Sonar v. State of Maharashtra, (2019) 18 SCC 191 : (2020) 3 SCC (Cri) 672] after considering the decisions of this Court in Bhajan Lal [State of Haryana v. Bhajan Lal, 1992 Supp (1) SCC 335 : 1992 SCC (Cri) 426] , it is held by this Court that exercise of powers under Section 482 CrPC to quash the proceedings is an exception and not a rule. It is further observed that inherent jurisdiction under Section 482 CrPC though wide is to be exercised sparingly, carefully and with caution, only when such exercise is justified by tests specifically laid down in the section itself. It is further observed that appreciation of evidence is not permissible at the stage of quashing of proceedings in exercise of powers under Section 482 CrPC. Similar view has been expressed by this Court in Arvind Khanna [CBI v. Arvind Khanna, (2019) 10 SCC 686 : (2020) of Telangana v. Managipet, (2019) 19 SCC 87 : (2020) 3 SCC (Cri) 702] and in XYZ [XYZ v. State of Gujarat, (2019) 10 SCC 337 : (2020) 1 SCC (Cri) 173] , referred to hereinabove. , Managipet [State (Cri) SCC 94] 1 9.3. Applying the law laid down by this Court in the aforesaid decisions to the facts of the case on hand, we are of the opinion that the High Court has exceeded its jurisdiction in quashing the criminal proceedings in exercise of powers under Section 482 CrPC. 10. The High Court has failed to appreciate and consider the fact that there are very serious triable issues/allegations which are required to be gone into and considered at the time of trial. The High Court has lost sight of crucial aspects which have emerged during the course of the investigation. The High Court has failed to appreciate and consider the fact that the document i.e. a joint notarised affidavit of Mamta Gupta Accused 2 and Munni Devi under which according to Accused 2 MsMamta Gupta, Rs 25 lakhs was paid and the possession was transferred to her itself is seriously disputed. It is required to be noted that in the registered agreement to sell dated 27-10-2010, the sale consideration is stated to be Rs 25 lakhs and with no reference to payment of Rs 25 18 lakhs to MsMunni Devi and no reference to handing over the possession. However, in the joint notarised affidavit of the same date i.e. 27-10-2010 sale consideration is stated to be Rs 35 lakhs out of which Rs 25 lakhs is alleged to have been paid and there is a reference to transfer of possession to Accused 2. Whether Rs 25 lakhs has been paid or not the accused have to establish during the trial, because the accused are relying upon the said document and payment of Rs 25 lakhs as mentioned in the joint notarised affidavit dated 27-10-2010. It is also required to be considered that the first agreement to sell in which Rs 25 lakhs is stated to be sale consideration and there is reference to the payment of Rs 10 lakhs by cheques. It is a registered document. The aforesaid are all triable issues/allegations which are required to be considered at the time of trial. The High Court has failed to notice and/or consider the material collected during the investigation. 11. Now so far as the finding recorded by the High Court that no case is made out for the offence under Section 406 IPC is concerned, it is to be noted that the High Court itself has noted that the joint notarised affidavit dated 27-10-2010 is seriously disputed, however as per the High Court the same is required to be considered in the civil proceedings. There the High Court has committed an error. Even the High Court has failed to notice that another FIR has been lodged against the accused for the offences under Sections 467, 468, 471 IPC with respect to the said alleged joint notarised affidavit. Even according to the accused the possession was handed over to them. However, when the payment of Rs 25 lakhs as mentioned in the joint notarised affidavit is seriously disputed and even one of the cheques out of 5 cheques each of Rs 2 lakhs was dishonoured and according to the accused they were handed over the possession (which is seriously disputed) it can be said to be entrustment of property. Therefore, at this stage to opine that no case is made out for the offence under Section 406 IPC is premature and the aforesaid aspect is to be considered during trial. It is also required to be noted that the first suit was filed by Munni Devi and thereafter subsequent suit came to be filed by the accused and that too for permanent injunction only. Nothing is on record that any suit for specific performance has been filed. Be that as it may, all the aforesaid aspects are required to be considered at the time of trial only. 12. Therefore, the High Court has grossly erred in quashing the criminal proceedings by entering into the merits of the allegations as if the High Court was exercising the appellate jurisdiction and/or conducting the trial. The High Court has 19 exceeded its jurisdiction in quashing the criminal proceedings in exercise of powers under Section 482 CrPC. 13. Even the High Court has erred in observing that original complaint has no locus. The aforesaid observation is made on the premise that the complainant has not placed on record the power of attorney along with the counter filed before the High Court. However, when it is specifically stated in the FIR that Munni Devi has executed the the power of attorney and investigating officer has conducted the investigation and has recorded the statement of the complainant, accused and the independent witnesses, thereafter whether the complainant is having the power of attorney or not is to be considered during trial. thereafter 14. In view of the above and for the reasons stated above, the impugned judgment and order [RadheyShyam Gupta v. State of U.P., 2020 SCC OnLine All 914] passed by the High Court quashing the criminal proceedings in exercise of powers under Section 482 CrPC is unsustainable and the same deserves to be quashed and set aside and is accordingly quashed and set aside. Now, the trial is to be conducted and proceeded further in accordance with law and on its own merits. It is made clear that the observations made by this Court in the present proceedings are to be treated to be confined to the proceedings under Section 482 CrPC only and the trial court to decide the case in accordance with law and on its own merits and on the basis of the evidence to be laid and without being influenced by any of the observations made by us hereinabove. The present appeal is accordingly allowed.” In the light of the aforesaid facts and the afore-quoted judgment in the case of KAPTAN SINGH, the petition would not merit any consideration, as it would require investigation in the least. 11. But, what has merited consideration is the subsequent development after filing of the petition which is the judgment of the Apex Court in the case OM PRAKASH (supra). The private 20 complaint against the petitioners comes to be registered invoking Section 223 of BNSS on 11-09-2024. The prayer sought in the private complaint is as follows: “WHEREFORE, we most humbly pray that this Hon’ble Court be pleased to refer the above complaint to the jurisdictional police i.e., Bellandur Police for investigation under Section 175(3) of Bharatiya Nagarika Suraksha Sanhita, 2023 and to submit report before this Hon’ble Court, in the interest of justice.” (Emphasis added) Investigation was sought from the hands of the jurisdictional police under Section 175(3) of the BNSS, rightly so as by then BNSS was in place with effect from 01-07-2024. Since the complaint itself is registered after 01-07-2024, the procedure under BNSS ought to have been followed by the concerned Court in terms of Section 175(3) of BNSS. Section 175 of BNSS reads as follows: “175. Police officer's power to investigate cognizable case.—(1) Any officer in charge of a police station may, without the order of a Magistrate, investigate any cognizable case which a Court having jurisdiction over the local area within the limits of such station would have power to inquire into or try under the provisions of Chapter XIV: Provided that considering the nature and gravity of the offence, the Superintendent of Police may require the Deputy Superintendent of Police to investigate the case. 21 (2) No proceeding of a police officer in any such case shall at any stage be called in question on the ground that the case was one which such officer was not empowered under this section to investigate. (3) Any Magistrate empowered under Section 210 may, after considering the application supported by an affidavit made under sub-section (4) of Section 173, and after making such inquiry as he thinks necessary and submission made in this regard by the police officer, order such an investigation as above- mentioned. (4) Any Magistrate empowered under Section 210, may, upon receiving a complaint against a public servant arising in course of the discharge of his official duties, order investigation, subject to— (a) receiving a report containing facts and circumstances of the incident from the officer superior to him; and (b) after consideration of the assertions made by the public servant as to the situation that led to the incident so alleged.” (Emphasis supplied) Section 175 deals with Police Officer’s power to investigate a cognizable offence. Sub-section (3) thereof mandates that any Magistrate empowered under Section 210 of the BNSS may, after considering the application supported by an affidavit under sub- section (4) of Section 173 and after making such inquiry as he thinks necessary and submission made in this regard by the Police Officer, order an investigation which would mean that prior to 22 directing investigation to be ordered, the Police Officer of the jurisdictional police must be heard. 12. In the case at hand, the order of reference for investigation does not indicate following of any of the procedure as necessary in law. Whether this would vitiate the order of reference or otherwise, need not detain this Court for long or delve deep into the matter. The Apex Court in the case of OM PRAKASH (supra) considered this issue and held as follows: “…. … …. 28. However, before we part with the matter, we deem it necessary to discuss the changes brought to the scheme of Section 156 of the Cr.P.C. by the enactment of the Bharatiya Nagarik Suraksha Sanhita, 2023 (for short, “the BNSS”). is the BNSS 29. Section 175 of the BNSS corresponds to Section 156 of the Cr. P.C. Sub-section (1) of Section in parimateria with sub- 175 of section 156(1) of the Cr.P.C. except for the proviso which empowers the Superintendent of Police to direct the Deputy Superintendent of Police to investigate a case if the nature or gravity of the case so requires. Sub-section (2) of Section 175 the BNSS is identical to Section 156(2) of the Cr. P.C. Section 175(3) of the BNSS empowers any Magistrate who is empowered to take cognizance under Section 210 to order investigation in accordance with Section 175(1) and to this extent is in parimateria with Section 156(3) of Cr. P.C. However, unlike Section 156(3)of the Cr. P.C., any 23 Magistrate, before ordering Section 175(3) of the BNSS, is required to: investigation under a. Consider the application, supported by an affidavit, made by the complainant to the Superintendent of Police under Section 173(4) of the BNSS; b. Conduct such inquiry as he thinks necessary; and Consider the submissions made by the police c. officer. 30. Sub-section (4) of Section 175 of the BNSS is a new addition to the scheme of investigation of cognizable cases when compared with the scheme previously existing in Section 156 of the Cr. P.C. It provides an additional safeguard to a public servant against whom an accusation of committing a cognizable offence arising in the course of discharge of his official duty is made. The provision stipulates that any Magistrate who is empowered to take cognizance under Section 210 of the BNSS may order investigation against a public servant upon receiving a complaint arising in course of the discharge of his official duty, only after complying with the following procedure: a. Receiving a facts and circumstances of the incident from the officer superior to the accused public servant; and report containing b. Considering the assertions made by the accused public servant as regards the situation that led to the occurrence of the alleged incident. 31. A comparison of Section 175(3) of the BNSS with Section 156(3) of the Cr. P.C. indicates three prominent changes that have been introduced by the enactment of BNSS as follows: a. First, the requirement of making an application to the Superintendent of Police upon refusal by the officer in charge of a police station to lodge 24 the FIR has been made mandatory, and the applicant making an application under Section 175(3) is required to furnish a copy of the application made to the Superintendent of Police under Section 173(4), supported by an affidavit, while making the application to the Magistrate under Section 175(3). b. c. Secondly, the Magistrate has been empowered to conduct such enquiry as he deems necessary before making an order directing registration of FIR. Thirdly, the Magistrate is required to consider the submissions of the officer in charge of the police station as regards the refusal to register an FIR before issuing any directions under Section 175(3). the Court 32. The introduction of these changes by the legislature can be attributed to the judicial evolution of Section 156 of the Cr. P.C. undertaken by a number of decisions of this Court. In the case of Priyanka Srivastava v. State of U.P., (2015) 6 SCC 287, this Court held that prior to making an application to the Magistrate under Section 156(3) of the Cr. P.C., the applicant must necessarily make applications under Sections 154(1) and 154(3). It was further observed by that applications made under Section 156(3) of the Cr. P.C. must necessarily be supported by an affidavit sworn by the applicant. The reason given by the Court for introducing such a requirement under that Section 156(3) of the Cr. P.C. were being made in a routine manner and in a number of cases only with a view to cause harassment to the accused by registration of FIR. It was further observed that the requirement of supporting the complaint with an affidavit would ensure that the person making the application is conscious and also to see that no false affidavit is made. Once an affidavit is found to be false, the applicant would be liable for prosecution in accordance with law. This would deter him from applications was 25 casually invoking the authority of the Magistrate under Section 156(3). The relevant observations made by the Court are reproduced hereinbelow: to “27. Regard being had the aforesaid enunciation of law, it needs to be reiterated that the learned Magistrate has to remain vigilant with regard to the allegations made and the nature of allegations and not to issue directions without proper application of mind. He has also to bear in mind that sending the matter would be conducive to justice and then he may pass the requisite order. The present is a case where the accused persons are serving in high positions in the Bank. We are absolutely conscious that the position does not matter, for nobody is above the law. But, the learned Magistrate should take note of the allegations in entirety, the date of incident and whether any cognizable case is remotely made out. It is also to be noted that when a borrower of the financial institution covered under the Sarfaesi Act, invokes the jurisdiction under Section 156(3) Cr. P.C. and also there is a separate procedure under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, an attitude of more care, caution and circumspection has to be adhered to. 28. Issuing a direction stating “as per the application” to lodge an FIR creates a very unhealthy situation in society and also reflects the erroneous approach of the learned Magistrate. It also encourages unscrupulous and unprincipled litigants, like Respondent 3, namely, Prakash Kumar Bajaj, to take adventurous steps with courts to bring the financial institutions on their knees. As the factual exposition would reveal, Respondent 3 had prosecuted the earlier authorities and after the matter is dealt with by the High Court in a writ petition recording a settlement, he does not withdraw the criminal case and waits for some kind of situation where he can take vengeance as if he is the emperor of all he surveys. It is interesting to note that during the tenure of Appellant 1, who is presently occupying the position of Vice-President, neither was the loan taken, nor was the default made, nor was any action under the SARFAESI Act taken. However, the action under the SARFAESI Act was taken on the second time at the instance of the present Appellant 1. We are only stating 26 about the devilish design of Respondent 3 to harass the appellants with the sole intent to avoid the payment of loan. When a citizen avails a loan from a financial institution, it is his obligation to pay back and not play truant or for that matter play possum. As we have noticed, he has been able to do such adventurous acts as he has the embedded conviction that he will not be task because an application under taken Section 156(3) Cr. P.C. is a simple application to the court for issue of a direction to the investigating agency. We have been apprised that a carbon copy of a document is filed to show the compliance with Section 154(3), the Superintendent of Police concerned. it has been indicating sent to to 29. At this stage it is seemly to state that power under Section 156(3) warrants application of judicial mind. A court of law is involved. It is not the police taking steps at the stage of Section 154 of the Code. A litigant at his own whim cannot invoke the authority of the Magistrate. A principled and really grieved citizen with clean hands must have free access to invoke the said power. It protects the citizens but when pervert litigations takes this route to harass their fellow citizens, efforts are to be made to scuttle and curb the same. where country 30. In our considered opinion, a stage has come in Section 156(3) Cr. this P.C. applications are to be supported by an affidavit duly sworn by the applicant who seeks the invocation of the jurisdiction of the Magistrate. That apart, in an appropriate case, the learned Magistrate would be well advised to verify the truth and also can verify the veracity of the allegations. This affidavit can make the applicant more responsible. We are compelled to say so as such kind of applications are being filed in a routine manner without taking any responsibility whatsoever only to harass certain persons. That apart, it becomes more disturbing and alarming when one tries to pick up people who are passing orders under a statutory provision which can be challenged under the framework of the said Act or under Article 226 of the Constitution of India. But it cannot be done to take undue advantage in a criminal court as if somebody is determined to settle the scores. 27 31. We have already indicated that there has to be prior applications under Sections 154(1) and 154(3) while filing a petition under Section 156(3). Both the aspects should be clearly spelt out in the application and necessary documents to that effect shall be filed. The warrant for giving a direction that an application under Section 156(3) be supported by an affidavit is so that the person making the application should be conscious and also endeavour to see that no false affidavit is made. It is because once an affidavit is found to be false, he will be liable for prosecution in accordance with law. This will deter him to casually invoke the authority of the Magistrate under Section 156(3). That apart, we have already stated that the veracity of the same can also be verified by the learned Magistrate, regard being had to the nature of allegations of the case. We are compelled to say so as a number of cases pertaining to fiscal sphere, matrimonial dispute/family disputes, commercial offences, medical negligence cases, corruption cases and the cases where there is abnormal delay/laches in initiating criminal prosecution, as are illustrated in Lalita Kumari, [(2014) 2 SCC 1 : (2014) 1 SCC (Cri) 524] are being filed. That apart, the learned Magistrate would also be aware of the delay in lodging of the FIR.” (Emphasis supplied) 33. In a recent pronouncement of this Court in the case of Babu Venkatesh v. The State Of Karnataka, (2022) 5 SCC in Priyanka Srivastava (supra) were referred to and it was held as follows: observations made 639, the “24. This Court has clearly held that, a stage has come where applications under Section 156(3) Cr. P.C. are to be supported by an affidavit duly sworn by the complainant who seeks the invocation of the jurisdiction of the Magistrate. 25. This Court further held that, in an appropriate case, the learned Magistrate would be well advised to verify the truth and also verify the veracity of the allegations. The Court has noted that, applications under Section 156(3) Cr. P.C. are filed in a routine manner 28 without taking any responsibility only to harass certain persons. to be applications 26. This Court has further held that, prior to the filing of a petition under Section 156(3) Cr. P.C., there under have Sections 154(1) and 154(3) Cr. Court emphasises the necessity to file an affidavit so that the persons making the application should be conscious and not make false affidavit. With such a requirement, the persons would be deterred from causally invoking authority of the Magistrate, under Section 156(3) Cr. P.C. Inasmuch as if the affidavit is found to be false, the person would be liable for prosecution in accordance with law.” P.C. This (Emphasis supplied) 34. In light of the judicial interpretation and evolution of Section 156(3) of the Cr. P.C. by various decisions of this Court as discussed above, it becomes clear that the changes introduced by Section 175(3) of the BNSS to the existing scheme of Section 156(3) merely codify the procedural practices and safeguards which have been introduced by judicial decisions aimed at curbing the misuse of invocation of powers of a Magistrate by unscrupulous litigants for achieving ulterior motives. 35. Further, by requiring the Magistrate to consider the submissions made by the concerned police officer before proceeding to issue directions under Section 175(3), BNSS has affixed greater accountability on the police officer responsible for registering FIRs under Section 173. Mandating the Magistrate to consider the submissions of the concerned police officer also ensures that the Magistrate judicially while considering both the complaint and the submissions of the the police officer requirement of passing reasoned orders is complied with in a more effective and comprehensive manner.” applies his mind thereby ensuring that (Emphasis supplied) 29 In the light of the issue already considered by the Apex Court, the order of reference is rendered unsustainable for it being in violation of sub-section (3) of Section 175 of BNSS, inasmuch as the Police Officer was not heard prior to order of reference for investigation to the jurisdictional Police. In that light, the petition deserves to succeed, albeit in part and the matter requires to be remitted back to the hands of the learned Magistrate to redo the exercise of reference. 13. The Apex Court elucidates the reason behind the change and observes that the hearing of the concerned police officer before proceeding to issue direction for reference under Section 175(3) of the BNSS, fixes a greater accountability on the police officer responsible for registering a FIR under Section 175(3) of the BNSS. It further mandates that the concerned Court to consider the submissions of the concerned police officer and ensures that the Magistrate would apply his mind while referring the matter for investigation on consideration of the complaint and submissions of the police officer. 30 14. This Court is coming across plethora of cases where the concerned Courts do not follow the conditions stipulated in Section 175 or Section 223 of the BNSS. The concerned Courts should mandatorily follow the procedure stipulated in Section 175(3) while referring the matter to investigation by the jurisdictional police. The marked difference of Section 175(3) of the BNSS and Section 156(3) of the IPC, the earlier regime is that, the opinion of the police officer to whom the matter was to be referred for investigation is a prerequisite for reference. It was not even a requisite. Section 175(3) has brought about a change. The change is, prior to referring the matter for investigation under Section 175(3) of the BNSS, the police officer is required to be heard. Therefore, this procedure under Section 175(3) of the BNSS should be mandatorily followed by every Court, be it the Magistrate or the Court of Sessions of particular jurisdiction, so that it would avoid mushrooming of litigations before this Court alleging that particular procedural aberration. 31 15. For the aforesaid reasons, the following:
Decision
O R D E R (i) Writ Petition is allowed in part. (ii) The order of reference dated 26-10-2024 and the subsequent registration of FIR pursuant to the order of reference stand quashed. (iii) The matter is remitted back to the hands of the concerned Court to redo the exercise in terms of sub- section (3) of Section 175 of BNSS as is held by the Apex Court bearing in mind the observations made in the course of the order. The said exercise shall be concluded within 4 weeks from the date of receipt of a copy of this order. (iv) The Registry is directed to circulate this order to all the concerned Courts for strict adherence of the procedure stipulated under section 175 (3) of the BNSS to all the complaints that at registered post 01.07.2024. Sd/- (M.NAGAPRASANNA) JUDGE nvj CT:SS