Telangana High Court
M/S. Ramky Infrastructure Ltd., And 2 … vs State Of Telangana And Another on 1 April, 2025
Author: K. Lakshman
Bench: K. Lakshman
HON'BLE SRI JUSTICE K. LAKSHMAN
CRIMINAL PETITION No.2451 OF 2018
ORDER:
Heard Sri S. Niranjan Reddy, learned Senior Counsel,
representing Sri N.Naveen Kumar, learned counsel for the petitioners,
Smt. Shalini Saxena, learned counsel representing learned Public
Prosecutor, appearing for respondent No.1 and Sri T.Niranjan Reddy,
learned Senior Counsel, representing Sri A.Vijaya Bhaskar Reddy,
learned counsel appearing for 2nd respondent.
2. This Criminal Petition is filed under Section 482 of the Code
of Criminal Procedure, 1973 ( for short, ‘the CrPC‘) to quash the
proceedings in Cr.No.45 of 2016 dated 27.04.2016 pending on the file
of P.S. Kowtala, Kowtala Mandal, Adilabad District.
Facts of the case:-
3. The petitioners herein are A.1, A.2 and A.4. The offences
alleged against the petitioners herein are under Sections 406, 420, 447
and 504, 120-B and 294 (b) read with 34 of Indian Penal Code, 1860
( for short, ‘ the IPC‘). On the complaint dated 27.04.2016, lodged by
2nd respondent, P.S. Kowtala have registered a case in Cr.No.45 of
2016 against the petitioners herein and A.3.
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4. As per the complaint dated 27.04.2016 of 2nd respondent, the
allegations leveled against the petitioner and A.3 are as that it is in the
business of construction of multi storeyed buildings, colonies,
complexes and housing projects etc. On 05.08.2009, Sri Ramaiah,
represented M/s. Sri Chennakesava Constructions (for short, ‘CK
constructions’) approached 2nd respondent, requested to execute the
contract which was awarded to them by the 1st petitioner. On
09.07.2008, there was a contract agreement entered between the 1st
petitioner and CK Constructions for carrying on works of Pranahitha
Chevella Lift Irrigation Scheme (for short, ‘PCLIS’) and excavation of
gravity canal including formation of embankments, construction of
Sluices Cross Massonry and Cross Drainage works, lining etc. 1st
petitioner company was awarded with the contract for PCLIS –
Package I – detailed investigation and preparation of Design and
Drawings, Estimates, Land Plan Schedules and Excavation of gravity
canal including formation of embankments, constructions of CM &
CD works, lining etc. complete for the reach from KM 0.500 to KM
15.000 from Tummidi Hetti (v) to Karjavelli (v) which is taking off
from the right flank of the proposed Barrage across River Pranahita
near Tummidi Hetti (v) Kouthala (M) Adilabad District (Pkg. No. 1)
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for value of Rs. 229,14,00,000/- (Rupees two hundred and twenty nine
crores and fourteen lakhs only). 1st petitioner had agreed to give the
above works of contracts to CK constructions on back to back basis
with total responsibility for execution of the contract in toto. As CK
constructions, could not carry on the works awarded to them, they
represented by Sri. Ramaiah entered into a contract with 2nd
respondent. In pursuance to the agreement, 2nd respondent has been
carrying on the works since 2009. 1st petitioner knows very well that
2nd respondent is carrying on the works in the place of CK
constructions. 1st petitioner is well aware that 2nd respondent has
entered into an agreement with CK constructions. The personnel of 1st
petitioner were visiting the site and constantly supervising the works
carried out by 2nd respondent. 1st petitioner was guiding 2nd
respondent in carrying on the works and further informing with regard
to the payment schedule. Part of the payments were released in favour
of 2nd respondent. In fact, 2nd respondent has to receive a sum of Rs.20
Crores, from 1st petitioner and CK constructions. 2nd respondent has
executed the work and incurred total expenditure of Rs.90 Crores in
executing the work. 1st petitioner has received total amount but in
collusion with CK constructions, are not paying the amounts to 2nd
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respondent. They have entered into conspiracy, evading the payments
of the 2nd respondent even after repeated requests to CK constructions
to pay the amount but it was later discovered that CK constructions
did not receive the payments. 2nd respondent enquired with 1st
petitioner who stated that they have already paid the amounts to CK
constructions. 2nd respondent apprehend that both 1st petitioner and
CK constructions have entered into a criminal conspiracy in evading
payments for the works done by 2nd respondent.
5. The Managing Partner of CK constructions expired on
13.04.2016. On 17.04.2016, 1st petitioner forcibly trespassed into the
site, deployed an excavator and started damaging the work which was
already executed by 2nd respondent. When 2nd respondent objected for
the same, the staff of 1st petitioner including petitioner No.3 abused
them. 1st petitioner, in collusion with CK constructions, tried to
dispossess the 2nd respondent from the site. 2nd respondent has
invested huge amounts, men and machinery for the site, still there is
much work pending, the same has to be executed by 2nd respondent in
terms of the agreement entered between 2nd respondent and CK
constructions within the agreed timelines. There is dishonest intention
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on the part of the petitioners and other accused right from the
inception.
6. It is further alleged that knowing pretty well that the
Managing Partner of CK constructions had expired, 1st petitioner has
resorted to illegal tactics with 2nd respondent to carry on the work with
an evil intention to evade the payments of Rs.20 Crores. The accused
has a modus operandi of making to execute the work with the
expenditure incurred by it and in not paying the entire amounts to
them. Further, the 1st petitioner did not allow the 2nd respondent to
carry on the works.
7. The said acts of the accused in not paying the amounts after
receiving the same from the Government would amount to
embezzlement of funds, and further not allowing them to carry on the
works would amount to cheating. When 2nd respondent was executing
the work, 3rd petitioner – site Engineer of 1st petitioner and his staff
trespassed into the site, when 2nd respondent objected, they stated that
they are doing the same, on the instructions of their Chairman i.e. 2nd
petitioner. They have abused staff of 2nd respondent. Thus, the
petitioners along with the other accused trespassed into the site with
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mala fide intention and caused injury to the staff and cause damage to
the machinery belongs to the 2nd respondent.
8. In furtherance of the above allegations, 2nd respondent has
lodged the said complaint with the Police, Kowtala who, in turn,
registered the aforesaid crime against the petitioners herein and A.3.
9. Challenging the proceedings in the said crime, petitioners
filed the present criminal petition.
10. 2nd respondent filed counter contending as follows:-
i. The petitioners filed the present petition by way of suppression
of facts.
ii. The contents of the complaint constitute the aforesaid offences.
iii. The petitioners are aware of the contract entered by and
between 2nd respondent and CK constructions and execution of
work by the 2nd respondent, in terms of the said contract.
iv. 2nd respondent has furnished bank guarantees in terms of the
agreement between the 2nd respondent and CK constructions. 1st
petitioner has made correspondence with regard to the same.
v. There are several factual aspects which the Investigating Officer
has to consider during the course of investigation.
vi. Scuttling investigation at the threshold is impermissible.
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11. Sri S.Niranjan Reddy, learned Senior Counsel, representing
Sri N.Naveen Kumar, learned counsel appearing for petitioners
contend as follows:-
i. The contents of the complaint lack the ingredients of the
offences.
ii. 1st petitioner is not aware of the agreement between the 2nd
respondent and CK constructions.
iii. There is no privity of contract between 1st petitioner and 2nd
respondent. As per the principal agreement, 1st petitioner has
executed an agreement with CK constructions. There is no
provision in the said agreement to enter sub contract by CK
constructions in favour of 2nd respondent with regard to the
subject work.
iv. The disputes between the petitioners and 2nd respondent are
civil in nature.
v. 2nd respondent has lodged the said complaint only for wrongful
gain.
vi. On consideration of the said aspects only, this Court granted
stay of investigation including arrest of the petitioners for a
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was extended thereafter.
vii. Thus, continuation of the proceedings in the subject crime
against the petitioners is an abuse of process of law.
viii. 2nd petitioner is chairman and 3rd petitioner is site Engineer of 1st
petitioner company. They are not vicariously liable.
ix. He has placed reliance on the principle laid down by the Apex
Court in Sunil Bharti Mittal vs. CBI 1
12. Whereas, Smt. Shalini Saxena, learned counsel representing
Sri Palle Nageshwar Rao, learned Public Prosecutor and Sri
T.Niranjan Reddy, learned Senior Counsel representing Sri A.Vijay
Bhasker Reddy, learned counsel appearing for 2nd respondent, would
contend that the proceedings are at crime stage. The Investigating
Officer still has to consider several aspects in the course of
investigation.
13. Smt. Shalini Saxena, learned counsel contend that the
Investigating Officer has already completed investigation. Since there
is change of Investigating Officer, the charge sheet is not filed. The
1
AIR 2015 SC 923
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present Investigating Officer will file charge sheet shortly. The
contentions raised by the petitioners herein are triable aspects and the
petitioners have to take the said defence before the trial Court and it is
for the trial Court to consider the same.
14. Sri T.Niranjan Reddy, learned Senior Counsel would
contend that there is suppression of facts by the petitioners. Petitioners
were aware that 2nd respondent and CK constructions have entered
into an agreement to execute the subject work, 2nd respondent has
furnished bank guarantees to the Government on behalf of the
petitioner No.1, staff of petitioner No.1 company used to visit site,
advise 2nd respondent in execution of work etc. Even then, in the
present petition, petitioners contended that they are not aware of the
agreement between CK constructions and 2nd respondent. Thus, there
is suppression of facts by the petitioner and that they have not
approached this Court with clean hands and they have obtained
interim order by way of suppression of facts. Therefore, the present
Criminal Petition shall be liable to be dismissed only on the said
ground. The contents of the complaint constitute the offences alleged
against the petitioner herein.
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15. Scuttling the investigation at the threshold is impermissible.
He has placed reliance on the principle laid down by the Apex Court
in Tulsi Ram vs. State of Uttar Pradesh2, Union of India vs.
B.R.Bajaj3, M.Krishnan vs. Vijay Singh 4, State of Orissa vs. Saroj
Kumar Sahoo 5, Sanappa Reddy Maheedhar vs. State of AP 6,
Padal Venkata Rama Reddy vs. Kovvur Satyanarayana Reddy 7,
Mosiruddin Munshi vs. Mohd. Siraj8, K.Jagadish vs. Udaya
Kumar G.S. 9 and Neeharika Infrastructure Private Limited vs.
State of Maharashtra 10
16. With the aforesaid submissions, both of them sought to
dismiss the present criminal petition.
FINDINGS AND ANALYSIS:-
17. The aforesaid rival submissions would reveal that 1st
petitioner has entered into an agreement with the erstwhile State of
Andhra Pradesh through Irrigation and Command Area Development
has issued tender notification dated 03.09.2007 for the works of
2
(1962) SCC Online SC 99
3
(1994) 2 SCC 277
4
(2001) 8 SCC 645
5
(2005) 13 SCC 540
6
(2007) 13 SCC 165
7
(2011) 12 SCC 437
8
(2014) 14 SCC 22
9
(2020) 14 SCC 552
10
(2021) 19 SCC 401
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‘PCILS’ – Package I – detailed investigation and preparation of
Design and Drawings, Estimates, Land Plan Schedules and
Excavation of gravity canal including formation of embankments,
constructions of CM & CD works, lining etc. complete for the reach
from KM 0.500 to KM 15.000 from Tummidi Hetti (v) to Karjavelli
(v) which is taking off from the right flank of the proposed Barrage
across River Pranahita near Tummidi Hetti (v) Kouthala (M) Adilabad
District (Pkg. No. 1) for value of Rs. 229,14,00,000/- (Rupees two
hundred and twenty nine crores and fourteen lakhs only). 1st petitioner
company participated in the said tenders and stood as successful
bidder. It has entered into an agreement dated 06.06.2008 with CK
constructions. The value of the contract is Rs.229.14 Crores.
18. It is also not in dispute that the 1st petitioner has entered into
sub contract with CK Constructions/A.3 dated 09.06.2008 on the
specific terms and conditions mentioned therein.
19. According to the 2nd respondent, it has entered into sub
contract agreement with CK constructions (back to back basis) dated
05.08.2009 on the specific terms and conditions mentioned therein.1st
petitioner is aware of the same. It has executed works in terms of the
sub contract to the tune of Rs.90 Crores. Staff of the 1st petitioner used
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to advise the 2nd respondent by visiting the site regularly. 2nd
respondent has also provided 9 bank guarantees in favour of
Superintending Engineer, I & CADD, medium Irrigation Projects
Circle, Bellampally, Adilabad District, all dated 24.02.2010. UCO
bank has also issued letter 08.08.2013 for retention of money under
the said bank guarantees. 1st petitioner has addressed a letter dated
22.02.2010 requesting the petitioners to procure adequate bank
guarantees. Therefore, now the 1st petitioner cannot plead ignorance
with regard to agreement entered by 2nd respondent with CK
Constructions and execution of work by 2nd respondent pursuant to the
said agreement, it amounts to suppression of facts.
20. It is relevant to note that in paragraph No.14 of the present
criminal petition, the petitioners have contended that the 1st petitioner
did not have any information or idea about the impugned contract
agreement entered into between the 2nd respondent and CK
constructions. Even if it is to be assumed, but not admitted that the
averment made by the 2nd respondent that CK constructions took
permission from the 1st petitioner, as the sub letting shall not create
contract between the 1st petitioner and CK Constructions.
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21. In ground No.XI, the petitioners further contended that the
petitioner’s company has no knowledge about the alleged sub-contract
entered into between CK Constructions and 2nd respondent. There is
no privity of contract between the 1st petitioner and 2nd respondent.
22. In the light of the aforesaid contentions, it is relevant to note
that the 1st petitioner company has addressed a letter dated 22.02.2010
requesting the 2nd respondent to obtain drawings and designs at the
earliest. In the said letter, 1st petitioner has referred to the agreement
dated 06.06.2008 entered by and between the 1st petitioner and
Government, sub contract agreement dated 09.06.2008 by and
between 1st petitioner and CK constructions. 1st petitioner has
categorically stated that it was understood that the above work is
being handled by 2nd respondent on back to back basis from CK
constructions. 1st petitioner has also requested the 2nd respondent to
procure adequate men, material and machinery for early completion of
the said work. It has further requested the 2nd respondent to procure
adequate bank guarantees in the name of the client and give so that
they submit the same to the client to draw mobilization advance and
the same will be transferred to 2nd respondent through CK
Constructions to improve the progress at site.
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23. In the said letter, it is further stated that as seen at site good
efforts are being put up by 2nd respondent and 1st petitioner are
satisfied. It will also support in the event of any necessity in all
aspects.
24. It is also apt to note that 2nd respondent has furnished bank
guarantees Nos. 2110IGFIN000310, 2110IGFIN000610,
2110IGFIN000210, 2110IGFIN000510, 2110IGFIN000110,
2110IGFIN000710, 2110IGFIN000810, 2110IGFIN000410,
2110IGFIN000910, 2142IGFIN003913 ( for retention of money), all
dated 24.02.2010 in favour of Superintendent Engineer, Medium
Irrigation Projects Circle, Bellampally, Adilabad District, for an
amount of Rs.1 Crore each. The same was obtained from UCO bank,
Gachibowli, Hyderabad. 2nd respondent has also filed letter issued by
UCO bank i.e. bank guarantees for registration money dated
08.08.2013. 2nd respondent has also filed copies of bills reflecting
back to back payments. Perusal of the same would reveal that the
same are in respect of the sub contract.
25. As discussed supra, the aforesaid contract is for the purpose
of for preparation of designs, drawings estimates, land plan schedules
and excavation of gravity canal including FE, construction of sluices,
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cross masonry and cross drainage works lining etc. complete for the
reach from formation of embankments, constructions of CM & CD
works, lining etc. complete for the reach from KM 0.500 to KM
15.000 from Tummidi Hetti (v) to Karjavelli (v) which is taking off
from the right flank of the proposed Barrage across River Pranahita
near Tummidi Hetti (v) Kouthala (M) Adilabad District (Pkg. No. 1)
for value of Rs. 229,14,00,000/- (Rupees two hundred and twenty nine
crores and fourteen lakhs only).
26. According to the 2nd respondent, it has commenced
execution of the work at the site since 2009. Therefore, the petitioners
cannot contend that they are not aware of the same. The aforesaid
contentions of the petitioners that they are not aware of the sub
contract entered between the 2nd respondent and CK Constructions is
contrary to record and untenable. Thus, this Court is of the considered
view that the petitioners filed the present Criminal Petition by way of
suppression of the aforesaid fact. Only on the said ground, the present
petition is liable to be dismissed.
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27. In M/S S.J.S. Business Enterprises (P) Ltd vs State Of
Bihar 11, the Apex Court held that as a general rule, suppression of a
material fact by a litigant disqualifies such litigant from obtaining any
relief. This rule has been evolved out of the need of the Courts to deter
a litigant from abusing the process of Court by deceiving it. Similar
view has been taken in G.M. Haryana Roadways vs Jai Bhagwan 12,
Prestige Lights Ltd. v. State Bank of India 13. Placing reliance on the
said judgments, the Apex Court in the Auroville Foundation vs
Natasha Storey14, in paragraph No.9 held as follows:-
9. It is no more res integra that the Doctrine of “Clean hands
and non-suppression of material facts” is applicable with full
force to every proceedings before any judicial forum. The
party invoking extraordinary jurisdiction of the High Court
under Article 226 of the Constitution of India must come with
clean hands and disclose all correct and material facts in his
Writ Petition. If it is brought to the notice of the Court that the
petition has been guilty of suppression of material and
relevant facts or has not come with clean hands, such conduct
must be seriously viewed by the courts as the abuse of process
of law and the petition must be dismissed on that ground
alone without entering into the merits of the matter.11
AIR 2004 SC 2421
12
(2008) 4 SCC 127
13
(2007) 8 SCC 449
14
Civil Appeal No.13651 of 17.03.2025
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28. As discussed supra, in the present case, there is
misrepresentation and suppression of facts by the petitioners that
they are not aware of the agreement entered by and between 2nd
respondent and CK Constructions, despite letter dated 24.02.2010
and bank guarantees furnished by 2nd respondent.
29. As discussed supra, on the complaint dated 22.04.2016, the
Police Kowtala, has registered the aforesaid crime against the
petitioners herein and A.3 for the offences punishable under Sections
406, 420, 447 and 504, 120-B and 294 (b) read with 3 of IPC. The said
sections are extracted below :-
405. Criminal breach of trust.–
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 made touching the discharge of such trust, or
willfully suffers any other person so to do, commits “criminal breach
of trust”.
406. Punishment for criminal breach of trust.–
Whoever commits criminal breach of trust shall be punished with
imprisonment of either description for a term which may extend to
three years, or with fine, or with both.
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415. Cheating.–
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”
420. Cheating and dishonestly inducing delivery of property.–
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.
447. Punishment for criminal trespass.–
Whoever commits criminal trespass shall be punished with
imprisonment of either description for a term which may extend to
three months, or with fine which may extend to five hundred rupees,
or with both.
506. Punishment for criminal intimidation.–
Whoever commits, the offence of criminal intimidation shall be punished
with imprisonment of either description for a term which may extend to two
years, or with fine, or with both;
294 (b) of IPC:
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Crl.P. No.2451 of 2018Anyone who sings, recites, or utters any obscene song, ballad, or words in
or near any public place with imprisonment up to three months, a fine, or
both.
30. In Prof. R.K. Vijayasarathy vs. Sudha Seetharam15,
Dr. Lakshman vs. State of Karnataka 16, the Apex Court held that
delivery of 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”. The ingredients to constitute
an offence of cheating are as follows:
i) there should be fraudulent or dishonest inducement of a person by
deceiving him;
ii) (a) the person so induced should be intentionally induced to deliver any
property to any person or to consent that any person shall retain any
property, or
(b) the person so induced should be intentionally induced to do or to omit to
do anything which he would not do or omit if he were not so deceived; and
iii) in cases covered by (ii) (b) above, the act or omission should be one
which caused or is likely to cause damage or harm to the person induced in
body, mind, reputation or property.
15
2019 6 SCC 739
16
2019 9 SCC 677
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A fraudulent or dishonest inducement is an essential ingredient of the
offence. A person who dishonestly induces another person to deliver any
property is liable for the offence of cheating.
31. In Tulsiram (supra), the Apex Court held that proving of
one element is sufficient to attract the said offences.
32. As discussed supra, in the complaint, 2nd respondent
specifically alleged that the petitioners in collusion with CK
constructions induced the 2nd respondent.
33. With regard to the offence under Section 447 of IPC, it is
the specific contention of the 2nd respondent that in pursuance of the
sub contract dated 05.08.2009, CK constructions entrusted execution
of aforesaid work in favour of 2nd respondent and therefore, 2nd
respondent has been executed the said works in terms of the said sub
contract agreement on the site. 1st petitioner is aware of the same.
Even then, they have trespassed into the said site.
34. With regard to the offence under Section 506 and 294(b)
IPC, it is relevant to note that in the complaint dated 27.04.2016, there
is specific allegation against petitioners 2 and 3 that 3rd petitioner is
the site Engineers who tried to dispossess the staff of the 2nd
respondent with ulterior motive and also abused them with ulterior
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motive and he also abused the staff of the 2nd respondent on
17.04.2016. Staff of the 1st petitioner trespassed into the site, they
deployed an excavator, started damaging the works executed by 2nd
respondent. Thus, there are specific allegations against the 3rd
petitioner.
35. It is also specifically alleged by 2nd respondent that 2nd
petitioner is the Chairman of the 1st petitioner company and 3rd
petitioner and other staff of the 1st petitioner resorted to the aforesaid
illegal acts on the instructions and at the instance of the 2nd petitioner.
Thus, the same amounts to criminal intimidation and criminal
trespass.
36. As discussed supra, there are several factual aspects which
the Investigating Officer has to consider during the course of
investigation. The petitioners, have filed principal agreement dated
06.06.2008 entered between the 1st petitioner and erstwhile State of
Andhra Pradesh represented by Irrigation and CAD. Even according
to the petitioners, 1st petitioner has entered into an agreement with the
CK constructions, on 09.06.2008. As per the said agreement, whether
CK constructions can enter into sub contract with the 2nd respondent
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dated 05.08.2009 is a factual aspect which the Investigating Officer
has to consider.
37. As discussed supra, admittedly, 2nd respondent has
furnished the aforesaid bank guarantees and it has been executing the
said works. The letter dated 22.02.2010 addressed by 1st petitioner in
favour of 2nd respondent would reveal the said fact. Vide the aforesaid
letter, 1st petitioner requested the 2nd respondent to procure men and
machinery, bank guarantees for execution of the said work. In fact, 1st
petitioner expressed its readiness to do needful in execution of the said
project to the 2nd respondent. Therefore, now the petitioners cannot
contend that they are not aware of the said work executed by 2nd
respondent. Thus, there are several factual aspects which the
Investigating Officer has to consider during the course of
investigation. Scuttling the investigation at the threshold is
impermissible as held by the Apex Court in Neeharika
Infrastructure Private Limited (supra).
38. In this regard, the following paragraphs of Somjeet Mallick
v. State of Jharkhand 17 are relevant:
17
(2024) 10 SCC 527
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15. Before we proceed to test the correctness of the
impugned order, we must bear in mind that at the stage
of deciding whether a criminal proceeding or FIR, as
the case may be, is to be quashed at the threshold or
not, the allegations in the FIR or the police report or
the complaint, including the materials collected during
investigation or inquiry, as the case may be, are to be
taken at their face value so as to determine whether a
prima facie case for investigation or proceeding against
the accused, as the case may be, is made out. The
correctness of the allegations is not to be tested at this
stage.
16. To commit an offence, unless the penal statute
provides otherwise, mens rea is one of the essential
ingredients. Existence of mens rea is a question of fact
which may be inferred from the act in question as well as
the surrounding circumstances and conduct of the accused.
As a sequitur, when a party alleges that the accused,
despite taking possession of the truck on hire, has failed to
pay hire charges for months together, while making false
promises for its payment, a prima facie case, reflective of
dishonest intention on the part of the accused, is made out
which may require investigation. In such circumstances, if
the FIR is quashed at the very inception, it would be
nothing short of an act which thwarts a legitimate
investigation.
17. It is trite law that FIR is not an encyclopaedia of
all imputations. Therefore, to test whether an FIR
discloses commission of a cognizable offence what is to
be looked at is not any omission in the accusations but
the gravamen of the accusations contained therein to
find out whether, prima facie, some cognizable offence
has been committed or not. At this stage, the court is
not required to ascertain as to which specific offence
has been committed.
18. It is only after investigation, at the time of
framing charge, when materials collected during
investigation are before the court, the court has to draw
an opinion as to for commission of which offence the
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accused should be tried. Prior to that, if satisfied, the
court may even discharge the accused. Thus, when the
FIR alleges a dishonest conduct on the part of the
accused which, if supported by materials, would
disclose commission of a cognizable offence,
investigation should not be thwarted by quashing the
FIR.
19. No doubt, a petition to quash the FIR does not
become infructuous on submission of a police report under
Section 173(2)CrPC, but when a police report has been
submitted, particularly when there is no stay on the
investigation, the court must apply its mind to the materials
submitted in support of the police report before taking a
call whether the FIR and consequential proceedings should
be quashed or not. More so, when the FIR alleges an act
which is reflective of a dishonest conduct of the accused.
39. Sri T.Niranjan Reddy, learned Senior Counsel representing
Sri A. Vijaya Bhaskar Reddy, learned counsel appearing for 2nd
respondent, placed reliance on the principles laid down by the Apex
Court in the following judgments and the same are discussed as
follows:-
i) In Neeharika (supra), the Apex Court held that courts
should not interfere with FIRs or investigations under Section 482
CrPC unless the case falls under the Bhajan Lal principles. Interim
orders like “no coercive steps” should not be routine and must be
justified with reasons. The Court emphasized the investigating
agency’s statutory right to probe cognizable offences. This case
25
KL,J
Crl.P. No.2451 of 2018strongly discourages pre-trial interference. It supports continuation
of proceedings where a prima facie case exists.
ii) In K. Jagadish (supra), The Apex Court reiterated that
even if a registered document exists and civil remedies are available,
criminal proceedings can proceed when coercion or fraud is alleged. It
upheld that civil and criminal liabilities can coexist on the same
set of facts. The complainant’s version, including coercion and post-
dated cheques, created a case for trial. Thus, quashing FIRs solely
because a civil suit is pending, is impermissible. This judgment
supports non-quashing in commercial fraud cases.
iii) In Mosiruddin Munshi (supra), the Apex Court upheld
criminal proceedings where the complainant was duped into paying
money under false promises of property transfer. It ruled that when a
transaction involves deliberate misrepresentation and fraud, criminal
law is attracted. Even if a civil suit for specific performance is
possible, that doesn’t negate criminal intent. Hence, the case supports
FIR continuation in contract-based fraud scenarios. It aligns with the
present matter involving alleged conspiracy and dishonesty.
26
KL,J
Crl.P. No.2451 of 2018
iv) In Sanapareddy Maheedhar (supra), the Apex Court
ruled that a Magistrate can direct further investigation even if
police submit a closure report, especially where procedural
irregularities exist. It reinforced the principle that judicial scrutiny is
necessary if the investigation appears influenced or insufficient. The
decision emphasized that factual disputes and allegations must be
properly probed. This case supports a deeper investigation in complex
or sensitive matters. It is relevant to the instant case where the
charge sheet is pending due to officer change.
v) In Saroj Kumar Sahoo (supra) The Court held that at the
FIR stage, courts should not evaluate evidence in detail but only
examine whether allegations disclose a cognizable offence. It
cautioned against prematurely quashing criminal proceedings.
Where the complaint reflects elements of deception, courts must allow
full investigation. This reinforces that threshold scrutiny under Section
482 should not stifle prosecution. It supports the contentions in the
present case that factual matters must be tested during trial.
vi) In M. Krishnan (supra), criminal proceedings were
wrongly quashed by the High Court due to the existence of a civil
dispute. The Supreme Court clarified that serious allegations like
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KL,J
Crl.P. No.2451 of 2018
forgery and breach of trust invoke criminal liability irrespective
of civil remedies. The decision upholds the complainant’s right to
pursue both forums. It stresses that premature interference hampers
justice. It is relevant to the cases where the complaint includes
cheating and conspiracy as in the present case.
vii) In B.R. Bajaj (supra), the case dealt with public servants
and allegations of misuse of position in the context of lotteries. The
Court held that procedural safeguards and proper investigation
are crucial before quashing FIRs. Although it emphasized judicial
restraint, its primary focus was on public trust and administrative
conduct. Hence, its relevance to private contractual disputes is
marginal. It offers general guidance on Section 482 but is less
applicable to the facts at hand.
viii). In Tulsi Ram (supra), it is the landmark ruling which
clarified that for the offence of cheating under Section 420 IPC, it’s
sufficient to prove wrongful gain or loss, not both. It emphasized that
dishonest intention at the time of the act is key. This interpretation
helps sustain charges in complex fraud or conspiracy cases. It directly
supports framing of charges in the current matter where loss to the
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KL,J
Crl.P. No.2451 of 2018
respondent and gain to the accused are alleged. Thus, the case backs
the complainant’s allegations.
40. It is the specific contention of Smt. Shalini Saxena, learned
counsel representing learned Public Prosecutor that the Investigating
Officer has already completed investigation. In view of change of the
Investigating Officer, the present investigating Officer could not file
the charge sheet. He will file the charge sheet shortly.
41. In the light of the aforesaid discussion, this Court is of the
view that prima facie, contents of the complaint dated 27.04.2016
constitute the aforesaid offences against the petitioners and other
accused. However, on consideration of the statements of the witnesses
on completion of investigation, it is for the Investigating Officer either
to delete or add any provisions of law and also drop charge sheet
against any of the accused. Therefore, scuttling the investigation at the
threshold is impermissible.
42. Therefore, the present criminal petition is dismissed.
Consequently, miscellaneous petitions pending, if any, in this
Criminal Petition shall stand closed.
________________________
JUSTICE K. LAKSHMAN
Date:01.04.2025.
Vvr
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