Magistrate’s Order U/S. 156(3) CrPC For registration of FIR is Not Vitiated Merely Because Complainant Didn’t Avail Remedy Under S.154(3)

 1. In Special Leave Petition (Crl.) No.18084 of 2024 and in

Special Leave Petition (Crl.) No.18087 of 2024, the

challenge is to the judgment and order of the High Court

in Crl.M.C.2833 of 2005 and Crl.M.C.3244 of 2005 dated

3rd September, 2024 whereby petitions seeking quashing

of the order dated 1st July, 2005 passed by the

Metropolitan Magistrate, New Delhi and the criminal

proceedings pursuant to the FIR No.380 of 2005 were

dismissed.

2. In Special Leave Petition (Crl.) No.18094 of 2024, Special

Leave Petition (Crl.) No.18091 of 2024 and Special Leave

Petition (Crl.) No.18095 of 2024, challenge is to the

judgment and order of the High Court again dated 3rd

September, 2024 whereby petitions seeking quashing of

the order dated 3rd June, 2004 passed by the Metropolitan

Magistrate, New Delhi and the criminal proceedings

pursuant to the FIR No.326 of 2004 were refused on the

same and identical grounds as contained in the above

referred judgment passed in Crl.M.C.2833 of 2005 and

Crl.M.C.3244 of 2005.

3. Since, in all the above SLPs, the facts and contentions are

similar, they are being considered and decided by this

Court vide common judgment by taking SLP(Crl.)

No.18084 of 2024 as the lead case and by narrating the

facts as stated therein.

4. Heard Shri Ranjit Kumar, Shri Jayant Bhushan, and Shri

Rajat Nair, learned counsel for the parties.

5. The short question arising for consideration in Special

Leave Petition (Crl.) No.18084 of 2024 is whether the High

Court in exercise of its power under Section 482 of Code of

Criminal Procedure1 or under Article 226/227 of the

Constitution is justified in refusing to quash the FIR

No.380/2005 registered at Police Station, Defence Colony,

Delhi, under Sections 420, 120-B and 34 of the Indian

Penal Code2 and the order dated 01.07.2005 passed by the

Metropolitan Magistrate, New Delhi, directing for the

registration of the aforesaid FIR.

Factual Background:

6. The facts leading to the present dispute are that the

complainant M/s Sunair Hotels Limited3 was allotted land

at Bangla Sahib Road, New Delhi, for the purposes of

construction and operation of a hotel. The said

construction and operation of the hotel, apart from land,

1

In short ‘CrPC’

2

In short ‘IPC’

3

In short ‘SHL’

4

required substantial financial investments which were not

readily available with SHL.

7. A non-banking finance company VLS Finance Limited4

through its directors and senior officers (the accused) Shri

M. P. Mehrotra, Shri Somesh Mehrotra, Mr. Harsh Allagh,

Mr. Anurag Bhatnagar, Mr. K.K. Soni & Mr. Pankaj

Shrimali, upon acquiring knowledge of the above hotel

project approached SHL with the desire to join the project

as financial consultants. They assured SHL that it would

launch a public issue of 10 lakh equity shares of Rs.10/-

each on a premium of Rs.100/- per share so as to resolve

its financial crises. Accordingly, SHL entered into a

Memorandum of Understanding5 with VLS on 11.03.1995.

The MoU inter alia provided that VLS would invest Rs.7

crore as equity and give Rs.10 crore as an interest-bearing

security deposit. On the other hand, SHL were to

contribute Rs.22 crore. VLS valued the shares of SHL at

Rs.60/- per share and promised to bring a public issue of

10 lakh equity shares at a premium of Rs.100/- per share.

SHL, however, later discovered that the promise of VLS to

4

In short ‘VLS’

5

In short ‘MoU’

5

issue shares at a premium of Rs.100/- per share was

legally not possible due to the guidelines of the Securities

and Exchange Board of India6, which required a company

to have three-year track record of consistent profitability.

SHL being a new venture could not have met the said

criteria. VLS being an experienced and expert in financial

matters deliberately concealed the above guidelines and

deceived SHL so as to gain control over the hotel venture.

8. SHL in view of the arbitration clause contained in the MoU

dated 11.03.1995, initiated arbitration proceedings

against VLS alleging that it had not kept its promises. In

the said arbitration proceedings, VLS filed a counter-claim

seeking return of its entire deposit of Rs.10 crore with

interest. The said arbitration proceedings concluded on

18.07.2015 with an award wherein the claim set up by

SHL was dismissed, with a direction to SHL to refund

security amount of Rs.10 crore to VLS along with interest

from the date of deposit till payment. The said award of the

arbitral tribunal is a subject matter of challenge before the

6

In short ‘SEBI’

6

High Court of Delhi under Section 34 of the Arbitration &

Conciliation Act, 1996.

9. Some time in the year 2000, VLS discovered fraudulent

conduct on part of SHL and its directors. It, therefore, filed

a complaint on 14.02.2000 leading to the registration of

FIR No.90/2000 at Police Station, Connaught Place,

against SHL under Sections 406, 409, 420, 421, 422, 467,

468, 471 and 477-A of the IPC. VLS filed another

complaint on 19.02.2002 leading to FIR No.99/2002 again

at Police Station, Connaught Place, against some of the

directors and office bearers of the SHL under Sections 406,

420, 424, 467, 468, 471, 477 and 120-B of IPC alleging

that approximately Rs.15 crore was siphoned off by them

from the accounts of SHL. A third complaint was filed by

VLS on 27.02.2002 on the basis of which FIR No.148/2002

was registered at Police Station, Defence Colony, under

Sections 384, 406, 409, 467, 471 and 120-B of the IPC

against some of the office bearers of the SHL.

10. It is alleged that in retaliation to the aforesaid

complaints/FIRs lodged by VLS, on 03.06.2004 SHL filed

a complaint with an application under Section 156(3) CrPC

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against the officials of the VLS. On this application,

Metropolitan Magistrate vide order dated 03.06.2004

directed registration of an FIR and accordingly, FIR

No.326/2004 was registered at Police Station, Connaught

Place, under Sections 406, 409, 420, 424 and 122-B IPC.

It was alleged in the said complaint/FIR that VLS has

failed to fulfil its obligations under the MoU dated

11.03.1995. It had deposited only Rs.8 crore as security

instead of Rs.10 crore, as agreed upon. It failed to bring

out the public issue of SHL as agreed and that VLS played

fraud upon SHL so as to induce them into signing the MoU

on terms which were against the guidelines of SEBI.

11. VLS and its officers filed multiple petitions under Section

482 CrPC, a few read with Article 227 of the Constitution

before the Delhi High Court seeking quashing of the order

of Metropolitan Magistrate dated 03.06.2004 directing for

the registration of FIR and for the quashing of the FIR

No.326/2004 registered in pursuance thereof. The

operation of the order dated 03.06.2004 was stayed by the

High Court by an interim order dated 28.07.2004. The stay

order halted all police actions and it was made absolute

some time in 2009 with no substantive progress so far.

12. In this background, SHL on 01.07.2005 straight away filed

an application under Section 156(3) CrPC before the

Metropolitan Magistrate, Patiala House Court, New Delhi,

whereupon on the same day an order was passed directing

for registration of the FIR, pursuant to which FIR

No.380/2005 under Sections 420, 120-B and 34 IPC was

registered. In pursuance to the aforesaid FIR which is the

bone of contention in the present petition, investigations

were completed as there was no stay in that regard and a

chargesheet was filed way back in the year 2020 or 2021.

13. In the aforesaid facts and circumstances, VLS and some of

its officers moved the High Court under Section 482 CrPC

for the quashing of the FIR No.380/2005 and the order of

the Metropolitan Magistrate dated 01.07.2005 directing for

the registration of the aforesaid FIR.

14. The above petitions filed by the VLS and its officers have

been dismissed by the High Court by the order impugned,

holding that the order of the Metropolitan Magistrate dated

01.07.2005 is a speaking order passed after due

application of mind. The dispute raised in the FIR cannot

at this stage be held to be a civil dispute only as VLS itself

had filed FIRs in connection with the disobedience of the

same MoU which establishes that VLS accepts involvement

of some criminal element in the violation of the MoU giving

rise to the disputes. The issue whether the dispute arising

between the parties out of the same MoU is of a civil nature

or involves criminality cannot be adjudicated at this stage

without the parties having led evidence. Moreover, since

the investigations in pursuance of the impugned FIR have

been completed and chargesheets have been filed against

the accused persons, there is no reason or justification to

interfere with the FIR in exercise of powers under Section

482 CrPC or Article 226/227 of the Constitution.

Submissions of the Parties:

15. On behalf of the VLS, it has been argued that the lodging

of the instant FIR is a clear abuse of process of the court.

Therefore, the High Court ought to have invoked its

inherent jurisdiction to quash the said FIR. The

Metropolitan Magistrate has ordered for registration of the

FIR without there being any complaint to the police

authorities as mandated under Section 154(3) of CrPC.

The order under Section 156(3) of CrPC has been obtained

by material suppression and concealment of relevant facts,

especially with regard to the previous FIRs lodged by SHL

and those registered against it. It is a cryptic order which

has been passed in a routine manner without application

of mind. The dispute as raised in the application under

Section 156(3) is primarily a civil dispute with no

criminality attached to it. There are no specific allegations

against the accused persons.

16. In defence on behalf of the SHL, it has been contended that

the FIR is not liable to be quashed at this stage once the

matter has been thoroughly investigated and the

chargesheets have been filed. The appropriate remedy, if

any, for the VLS is to ask for the quashing of the

chargesheets. When the investigating agency during

investigation has already tested the veracity of the

allegations made in the FIR, it is not open for the court to

go into the same at this stage. The court is not empowered

to act as an investigating agency and to take a different

view in exercise of powers under Section 482 CrPC. The

Metropolitan Magistrate, upon pursual of the complaint,

has opined that a cognizable offence has been made out

and has, thus, passed the order of registration of the FIR

which cannot be termed as illegal in any manner.

Points for determination:

17. On the basis of the submissions of the parties, the

following points crop up for determination:

(i) Whether an application under Section 156(3) of the

CrPC could have been filed without approaching the

police authorities;

(ii) Whether the order dated 01.07.2005 passed by the

Metropolitan Magistrate is an order passed without

application of mind, irrespective of the fact that it

states that the parties were “heard” and the

documents were “perused”;

(iii) Whether the High Court can deny quashing of the

order dated 01.07.2005 passed by the Metropolitan

Magistrate and the FIR registered pursuant to it for

the reason that the investigations have been

completed and the chargesheets have been filed

against the accused persons;

(iv) Whether the nature of dispute raised in the offending

FIR is of a civil nature and there is no involvement of

criminality when both sides have previously lodged

FIRs originating from the same MoU dated

11.03.1995; and

(v) Whether the present FIR amounts to a successive

FIR based upon the same allegations as contained in

an earlier FIR No.326/2004 and as such cannot be

investigated independently.

18. Now, having outlined the points for determination, we

consider it appropriate to deal with the above points

serially/sequentially.

Point (i): Whether an application under Section 156(3) CrPC

could have been filed without approaching the

police authorities?

19. It is a settled law that one of the modes for setting criminal

law into motion is by giving information to the police

authorities in accordance with Section 154 CrPC

whereupon if a cognizable offence is prima facie made out

to the satisfaction of the police, it may investigate into the

offence even without the permission of the Magistrate. The

information so given is ordinarily called the “First

Information”, though this terminology has not been used

under the CrPC.

20. Section 154 of CrPC, inter alia, provides that information

relating to the commission of a cognizable offence can be

given orally or in writing to the officer-in-charge of the

police station and if it is given orally, it shall be reduced in

writing, which shall then be read out to the person giving

the information and shall be signed by him. A copy of the

information so received and reduced into writing, upon

being entered into the book kept for the purpose, shall be

given forthwith to the informant.

21. Sub-section (3) of Section 154 CrPC lays down that if the

information of a cognizable offence given to the officer-incharge of the police station is not being recorded or is being

refused to be recorded, the informant may send the

substance of the said information to the Superintendent of

Police concerned in writing and by post, who upon being

satisfied that such information discloses a cognizable

offence will either direct for the investigation of the offence

or may himself investigate the same.

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22. A plain and simple reading of Section 154 CrPC as a whole

makes it imperative upon the informant to first approach

the officer-in-charge of the police station for the purposes

of lodging an FIR in respect of a cognizable offence and

where the Police refuses to record such information, the

remedy is to approach the concerned Superintendent of

Police. It is only when no action is taken even by the

Superintendent of Police and the information of

commission of a cognizable offence is not being recorded

by the officer-in-charge of the police station or even by the

Superintendent of Police, that the person aggrieved or the

informant may move the court of the Magistrate concerned

to get the FIR registered and lodged with the concerned

police station.

23. Sub-section (3) of Section 156 CrPC simply empowers the

Magistrate to order an investigation of a cognizable offence.

24. Section 190 of the CrPC empowers the Magistrate to take

cognizance of an offence in three contingencies, namely: (i)

upon receiving a complaint of facts constituting the

offence; (ii) upon a police report of such facts; and (iii) upon

information received from any person other than the police

officer or upon his own knowledge that such an offence has

been committed.

25. In view of the provisions of Section 190 read with Section

156(3), the Magistrate is empowered to take cognizance of

any offence not only on the basis of the police report

submitted under Section 173 of the CrPC consequent to

the investigation pursuant to the FIR but also upon

receiving a complaint of facts from any person, other than

the police officer or on his own motion.

26. On a conspicuous reading of the provisions of Sections

154, 156 and 190 of the CrPC together, it is crystal clear

that an informant who wants to report about a commission

of a cognizable offence has to, in the first instance,

approach the officer-in-charge of the police station for

setting the criminal law into motion by lodging an FIR.

However, if such an information is not accepted by the

officer-in-charge of the police station and he refuses to

record it, the remedy of the informant is to approach the

Superintendent of Police concerned. It is only subsequent

to availing the above opportunities if he is not successful,

he may approach the Magistrate under Section 156(3)

CrPC for necessary action or of taking cognizance in

accordance with Section 190 of the CrPC.

27. In the instant case, a bare perusal of the application filed

under Section 156(3) of the CrPC dated 01.07.2005 would

reveal that the informant therein had simply stated that

an offence under Sections 420, 120-B and 34 of the IPC

have been committed and that the informant had

approached the “police officials” several times but in vain,

but the application is completely silent as to when did the

informant approach the Police or the Superintendent of

Police. The application nowhere states that the informant

has ever approached the officer-in-charge of the police

station for lodging the FIR in accordance with Section 154

of the CrPC or that on refusal to record such information

he has availed the remedy of approaching the

Superintendent of Police concerned. The mere bald

allegation without any details or proof thereof, that the

police authorities were approached several times is not

acceptable.

28. In Sakiri Vasu vs. State of U.P.7 it had been observed

that if a person has a grievance that the police station is

not registering the FIR under Section 154 CrPC, then he

can approach the Superintendent of Police under Section

154(3) CrPC by an application in writing. Even if that does

not yield any satisfactory result in the sense that either the

FIR is still not registered, or that even after registering it

no proper investigation is held, it is open to the person

aggrieved to file an application under Section 156(3) CrPC

before the Magistrate concerned. In other words, the court

reiterated that the proper procedure has to be availed of

and followed before moving the Magistrate under Section

156(3) CrPC.

29. It is well recognized in law that the person aggrieved must

first exhaust the alternative remedies available to him in

law before approaching the court of law. In other words, he

cannot ordinarily approach the court directly.

30. In the case at hand, the fact reveals that the informant had

neither approached the officer-in-charge of the police

station or the Superintendent of Police concerned as

(2008) 2 SCC 409

18

contemplated under Sections 154(1) and 154(3) of the

CrPC but has directly gone to the Magistrate under Section

156(3) of the CrPC. In such a situation, the Magistrate

ought not to have ordinarily entertained the application

under Section 156(3) so as to direct the Police for the

registration of the FIR, rather, it ought to have relegated

the informant to first approach the officer-in-charge of the

police station and then to the Superintendent of Police.

31. The Magistrate while passing the order dated 01.07.2005,

directing for the registration of the FIR in exercise of power

under Section 156(3) has not considered the above aspect

as to whether the informant had exhausted his remedies

available in law before approaching him under Section

156(3) of the CrPC.

32. In the facts and circumstances of the case, as the informant

had directly moved the Magistrate under Section 156(3) of

the CrPC without exhausting his statutory remedies, the

Magistrate could have avoided taking action on the said

application and could have refused to direct for the

registration of the FIR. However, as entertaining an

application directly by the Magistrate is a mere procedural

irregularity and since the Magistrate in a given

circumstance is otherwise empowered to pass such an

order, the action of the Magistrate may not be illegal or

without jurisdiction.

33. To sum up, the Magistrate ought not to ordinarily entertain

an application under Section 156(3) CrPC directly unless

the informant has availed and exhausted his remedies

provided under Section 154(3) CrPC, but as the Magistrate

is otherwise competent under Section 156(3) CrPC to direct

the registration of an FIR if the allegations in the

application/complaint discloses the commission of a

cognizable offence, we are of the opinion that the order so

passed by the Magistrate would not be without jurisdiction

and would not stand vitiated on this count.

34. The Magistrate by the order dated 01.07.2005 has simply

directed for the registration of the FIR so as to set the

criminal law in motion but has not exercised his power

under Section 190 of the CrPC of taking cognizance thereof.

In such a situation, the order so passed by the Magistrate,

though irregular, is of no prejudice to any party, much less

to the VLS. Therefore, it is not appropriate for this court to

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interfere in the matter or with the order of the Magistrate

dated 01.07.2005 or with the order impugned passed by

the High Court.

Point (ii): Whether the order dated 01.07.2005 passed by the

Metropolitan Magistrate is an order passed without

application of mind, irrespective of the fact that it

states that the parties were “heard” and the

documents were “perused”?

35. Section 156 of the CrPC provides for the power of the police

officer to investigate a cognizable offence. It inter alia vide

sub-section (3) empowers the Magistrate to order an

investigation in a cognizable case. No doubt, sub-section

(3) does not specifically provide that the Magistrate in

passing such an order of investigation has to pass a

speaking order or has to apply his mind to the contents of

the application or the material produced in support of it.

Nonetheless, it is a well recognized principle of law that

whenever any power is bestowed upon a judicial authority,

it is incumbent that it should be exercised on the basis of

sound legal principles by application of mind and by a

speaking order. Therefore, a reasoned order upon

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application of judicious mind is inherent while passing an

order under Section 156(3) of the CrPC.

36. In Union of India vs. Mohan Lal Capoor8

it has been

observed that reasons are links between the material on

which the conclusions are based. They disclose how the

mind is applied to the subject-matter for a decision. They

reveal rational nexus between facts considered and the

conclusions reached. Only, in this way, opinions or

decisions can be recorded which may be manifestly just

and reasonable.

37. It is well accepted vide Alexander Machinery (Dudley)

Ltd. vs. Crabtree9

that failure to give reasons amounts to

denial of justice as reasons are live links between mind of

the decision-taker to the controversy in question and the

decision or the conclusion arrived at.

38. The provisions of Section 156 (3) of the CrPC have

subsequently been interpreted and it has been held that

the Magistrate while directing for registering an FIR has to

apply his independent mind based upon legal principles

and the order so passed has to be a reasoned order. The

8

(1973) 2 SCC 836

9 1974 ICR 120 (NIRC)

22

provision so interpreted exists from its inception. Merely

because a judgment by the Court has simply interpreted

and reiterated the established principles of law that ought

to have been into practice, it would not mean that such

principles would be applicable prospectively only from the

date of its interpretation. The interpretation made later on

would not mean that the provision had a different meaning

prior to its above interpretation. Therefore, the High Court

manifestly erred in holding that at the relevant time there

was no requirement of application of mind and for passing

a speaking order, as the judgments of the higher courts

holding otherwise have been penned down subsequently.

In other words, the provision as it stands and interpreted,

requires passing of the speaking order on application of

mind from the very beginning. Moreover, a speaking order

is a part and an essential component of the principles of

natural justice, which are applicable to every judicial

order. Therefore, it was but natural for the Magistrate to

pass a reasoned order, irrespective of the interpretation of

the provision subsequently which was in line with the

principles of natural justice.

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39. The order of the Magistrate dated 01.07.2005 clearly states

that the Magistrate had “heard” the counsel on the

application under Section 156(3) and had “perused” the

complaint which reveals commission of a cognizable

offence. The said order is reproduced below:

“Fresh Complainant received along with

application U/s 156 (3) Cr.P.C. Be checked

and registered. Heard on the application U/s

156(3) Cr. P.C. Ld. Counsel for the

complainant has relied upon a judgement of

Allahabad High Court which is reported as

“2005 CRL L.J. 2028”. The perusal of the

complaint reveals the commission of

cognizable offence and the SHO Police

Station Defence colony is directed to get the

case registered and investigate the matter

U/s 156 (3) Cr. P.C the compliance report be

called for 05.10.2005.”

40. The mere stating in the order that the counsel has been

heard and the application and the material produced have

been perused, may not be indicative of the fact that the

Magistrate had actually applied his mind to the

controversy in issue. However, the fact that the perusal of

the application and complaint attached to it, satisfied the

Magistrate that it discloses a cognizable offence, is very

material and relevant which proves the application of

mind by him. Once such a satisfaction has been recorded

by the Magistrate, even if wrongly, it is not liable to be

interfered with in exercise of inherent powers by the higher

courts. The powers vested in the court either under

Section 482 CrPC or Article 226/227 of the Constitution

of India are not for the purposes of appreciating the

evidence or examining the correctness of the evidence

collected during investigation to record a different

conclusion other than recorded by the Magistrate that he

is satisfied that a cognizable offence has been disclosed in

the application/complaint. Moreover, when information

disclosing commission of cognizable offence is conveyed to

the police station, the officer-in-charge of the police

station cannot refuse to register the FIR. Therefore, if an

FIR has not been registered for any reason at the police

station and the Magistrate is satisfied that the information

discloses a cognizable offence, he can certainly direct for

its registration obviously on compliance of the provisions

of Section 154(3) of the CrPC. This is exactly what has

been done by the Magistrate by way of his order dated

01.07.2005 though ignoring the remedy under Section

25

154(3) of the CrPC which, as said earlier, amounts to mere

procedural irregularity.

41. In these facts and circumstances, for the reason that the

Magistrate not only heard the counsel and perused the

documents but has even considered the case law cited and

has opined that the information discloses a cognizable

offence, implies that he has actually applied his mind to

the contents of the application before passing the

impugned order directing for the registration of the FIR.

Therefore, we find no fault with the order of the High Court

in refusing to quash the order dated 01.07.2005 on the

above score.

Point (iii): Whether the High Court can deny quashing of the

order dated 01.07.2005 passed by the Metropolitan

Magistrate and the FIR registered pursuant to it for

the reasons that the investigations have been

completed and the chargesheets have been filed

against the accused persons?

42. We are conscious of the fact that investigation pursuant to

the impugned FIR and the submission of the chargesheets

thereof would have no lawful existence if the FIR itself is

bad or the order directing registration of the FIR is found

to be illegal.

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43. In the present case with which we are dealing, we have

already opined earlier that there is no legal flaw in the

order passed by the Magistrate dated 01.07.2005 directing

for the registration of the FIR. The order clearly states that

the Magistrate is satisfied that the allegations indeed make

out a cognizable offence for the purposes of investigation.

The said satisfaction recorded by the Magistrate cannot be

disturbed in exercise of inherent powers. Therefore, if in

pursuance of the said order, the FIR has been registered

which discloses a cognizable offence, the same cannot be

struck down at this stage. The powers conferred upon the

court under Section 482 CrPC or Article 226/227 of the

Constitution of India are discretionary in nature and it is

not obligatory upon the court to exercise the said inherent

power in each and every case, even if the order impugned

suffers from minor procedural irregularity, provided there

is no miscarriage of justice. Thus, in a case where

pursuant to the order of the Magistrate, which is not illegal

or without jurisdiction, an FIR has been registered which

discloses a cognizable offence and, thereafter, upon

investigation, chargesheets have been submitted, there is

27

apparently no justification for the court to exercise

discretionary jurisdiction so as to quash the FIR or the

order of the Magistrate.

44. Once much water has flown down the bridge subsequent

to the order of the registration of FIR and the registration

of FIR, giving rise to a fresh cause of action to challenge

the chargesheets, we are of the opinion that the High Court

has rightly refused to exercise its discretionary jurisdiction

so as to interfere with the FIR as the investigations have

been completed and the chargesheets have been filed.

Point (iv): Whether the nature of dispute raised in the

offending FIR is of a civil nature and there is no

involvement of criminality when both sides have

previously lodged FIRs originating from the same

MoU dated 11.03.1995?

45. The allegations in the application moved under Section

156(3) CrPC and the material in support thereof reveals

that SHL is contending breach of the conditions of MoU

dated 11.03.1995 and that it has been induced and

deceived by VLS for entering into the aforesaid MoU. VLS

has cheated SHL and its officers by making a false

promise which was legally impossible to be carried out.

The allegations of breach of conditions of the MoU or of

making a false promise by itself may not give rise to any

criminal action as no criminality is attached to it.

However, there are elements of inducement, criminal

conspiracy and cheating which are also borne out from

the allegations made in the application and the complaint,

which if proved, may amount to commission of an offence.

Therefore, once such allegations are made out, it is

difficult for the court in exercise of its inherent jurisdiction

to interfere with the FIR, only for the reason that some of

the disputes are of civil nature which may or may not be

having any criminality attached to it.

46. It is well settled by a catena of decisions of this Court,

especially in State of Haryana & Ors. vs. Ch. Bhajan

Lal Singh & Ors.10, that the discretion to quash an FIR

at a nascent stage has to be exercised with great caution

and circumspection. In this connection, it would be

beneficial to refer to an old case of Privy Council in King

Emperor vs. Nazir Ahmad Khwaja11 wherein the law

was well settled that the courts would not thwart any

investigation or that the courts should be very slow in

10 1992 SCC (CRI) 426

11 1944 SCC OnLine PC 29

29

interfering with the process of investigation. It is only in

rare cases where no cognizable offence is disclosed in the

FIR that the court may stop the investigation so as to

avoid the harassment of the alleged accused. Even in such

exercise of power, the court cannot embark upon an

inquiry as to the genuineness or otherwise of the

allegations made in the FIR or the complaint which have

to be examined only after the evidence is collected.

47. The breach of conditions of the MoU or allegations of false

promises in relation to the aforesaid MoU are

undisputedly subject matter of the different FIRs lodged

by VLS itself. Therefore, violation of those conditions for

some reasons have been considered by VLS to be

offensive. Therefore, the High Court rightly held that if

breach of those conditions of the MoU itself has been

considered to be of criminal nature by VLS, it cannot be

permitted to turn around and allege that such breach of

conditions would be of pure civil nature.

48. Thus, in the above facts and circumstances, we do not

consider to go into detail as to the exact nature of disputes

involved in the FIR and leave the same to be adjudicated

upon by the appropriate court where the chargesheets

have been submitted.

49. The last and one of the most important points that has

been raised is:

Point (v): Whether the present FIR amounts to a successive

FIR based upon the same allegations as contained

in an earlier FIR No.326/2004 and as such cannot

be investigated independently?

50. Undoubtedly, SHL got lodged FIR No.326/2004 at Police

Station, Connaught Place, Delhi, against VLS and its

officers. The aforesaid FIR was registered pursuant to the

order of the Magistrate dated 03.06.2004 passed on an

application moved by SHL under Section 156(3) of the

CrPC. The aforesaid application and the FIR primarily

allege that VLS and its officials have breached the MoU by

failing to fulfil its financial obligations of not launching a

public issue at premium etc. The allegations made in the

application under Section 156(3) of the CrPC and the

complaint/FIR No.326/2004, if compared with the

present FIR, are similar but not virtually same. In short,

the present FIR No.380/2005 is upon the same

information and allegation as contained in the earlier FIR

No.326/2004 but still different. Both the FIRs are by SHL

through its authorized representative and both are

against VLS and its officials which are mostly common but

there is some variance in the allegations and the parties.

51. The earlier FIR No.326/2004 was registered at Police

Station, Connaught Place, under Sections 406, 409, 420,

424 and 122-B IPC while the impugned FIR No.380/2005

was registered at Police Station, Defence Colony, again

alleging the breach of MoU and it is ex-facie evident that

SHL deliberately chose to lodge the second FIR 380/2005

at a different police station as a camouflage as the earlier

proceedings were under an order of stay of the High Court.

52. Section 300 CrPC debars a second trial. This is based on

the public policy that no one should be harassed twice for

the same offence by putting him to trial again and again.

53. In Jatinder Singh & Ors. vs. Ranjit Kaur12, the issue

was whether a first complaint having been dismissed for

default, could a second complaint be maintained. This

Court considered the matter and observed that there is no

provision in the CrPC or any other statute which debars a

12 2001 (2) SCC 570

32

complainant from preferring a second complaint on the

same allegations if the first complaint did not result in

conviction, acquittal or even discharge. However, when a

complaint is dismissed on merits, a second complaint on

the same facts cannot be made except in a very

exceptional circumstance.

54. It has been well settled that successive FIRs in respect of

a same cognizable offence are not maintainable provided

that on the basis of the earlier FIR, investigations have

been completed and the trial had either resulted in

conviction or acquittal of the accused.

55. It may be noted that in the case at hand, in connection

with the earlier FIR No.326/2004 on a petition filed under

Section 482 of the CrPC by VLS, interim order of stay of

investigation was passed which has been made absolute

with no further progress in the matter. Therefore,

pursuant to the FIR No.326/2004, there is no trial which

may have resulted in conviction or acquittal of the

accused person. Therefore, agreeing with the view that

there can be no second FIR and no fresh investigation on

receipt of the subsequent information but as on the basis

of the earlier first information, there is no conviction and

acquittal, it cannot be said that a second complaint/FIR

is not maintainable.

56. Further, in State of Bombay vs. Rusy Mistry13,

information of the commission of the same offence was

given to the police at two different places, by different

persons and at different times. The Court held that both

the reports will be independent First Information Reports.

57. In the case at hand, as previously stated, FIR

No.326/2004 was lodged at Police Station, Connaught

Place, New Delhi, whereas the subsequent FIR

No.380/2005 was lodged at Police Station, Defence

Colony, New Delhi. Both the FIRs may be based on similar

allegations but they are not virtually the same. The

allegations are different and even the parties against

whom the FIRs were filed are not the same. Therefore,

such a subsequent FIR may be maintainable but we

refrain ourselves from making any final comment on the

above aspect as no such finding on this aspect has been

returned by the court below.

13 AIR 1960 SC 391

58. Since in connection with FIR No.380/2005, investigations

have been completed and the High Court has refused to

quash the said FIR in exercise of its discretionary power,

we do not deem it necessary to exercise our discretion to

override that of the High Court and leave the matter to

proceed further in accordance with law.

59. Thus, in the overall facts and circumstances of the case,

we do not wish to interfere with the orders impugned and

the petitions are dismissed with the observations as made

above.

………….……………………………….. J.

(PANKAJ MITHAL)

………….……………………………….. J.

(S.V.N. BHATTI)

NEW DELHI;

JULY 25, 2025