Allowed

Devangi Sanghi v. State of Karnataka

Karnataka HC10 Sept 2024CRL.P/6475/2019

Case brief

AI extract

What is this about?

Accused No.3, a former marketing manager of an insurance company, sought quashing of proceedings for offences under Sections 406 and 420 IPC arising from a failed insurance policy arrangement. The High Court found the dispute contractual, noting refund of premium with interest, and quashed the proceedings against her.

What did the court decide?

Criminal proceedings against petitioner (accused No.3) in Crime No.195/2017, pending in CC No.20686/2018, for offences under Sections 406, 420, 120(B) r/w 34 IPC quashed.

Devangi Sanghi Vs State of Karnataka — Quashing and FIR | Karnataka HC (2024)

¶1

1 - NC: 2024:KHC:36788 CRL.P No. 6475 of 2019

¶2

IN THE HIGH COURT OF KARNATAKA AT BENGALURU

¶3

DATED THIS THE 10^TH DAY OF SEPTEMBER, 2024

¶4

BEFORE

¶5

THE HON'BLE MRS JUSTICE M G UMA

¶6

CRIMINAL PETITION NO. 6475 OF 2019

¶7

BETWEEN:

¶8

Digitally signed by SWAPNA V Location: high court of karnataka

¶9

DEVANGI SANGHI, W/O. UTKARSHA PANDEY, AGED ABOUT 28 YEARS, RESIDING AT NO.4/5, PALMOHAN APARTMENT, PUNJAB BAGH NWA CLUB ROAD, PUNJAB BAGH (WEST), NEW DELHI - 110 026.

¶10

(BY SRI. UDAY HOLLA, SR. ADVOCATE FOR SRI. VIVEK HOLLA, ADVOCATE)

¶11

…PETITIONER

¶12

AND:

¶13

STATE OF KARNATAKA REPRESENTED BY SHO HEBBAL POLICE STATION, BANGALORE - 560 024. REPRESENTED BY SPP HIGH COURT OF KARNATAKA BUILDING, BENGALURU - 560 001.

¶14

M/S. DREAMWORLD INDIA, HAVING ITS OFFICE AT NO.85, SMR ARCADE, VINAYAKA NAGAR, BESIDE VIVA TOYATA SHOWROOM, HEBBAL, BANGALORE - 560 024. REPRESENTED BY ITS PROPRIETOR, MR. NIKETAN J. DEVADIGA.

¶15

…RESPONDENTS

¶16

(BY SMT. ASMA KOUSER, ADDL.S.P.P. FOR R1

¶17

SRI. K.M. SOMASHEKARA, ADVOCATE FOR R2)

¶18

NC: 2024:KHC:36788 CRL.P No. 6475 of 2019

¶19

¶20

THIS CRL.P IS FILED U/S.482 CR.P.C PRAYING TO QUASH THE COMPLAINT DATED 03.07.2017 FILED BY RESPONDENT NO.2 BEFORE HEBBAL POLICE STATION (ANNEXURE-A); FIR REGISTERED BY POLICE INSPECTOR, HEBBAL POLICE STATION IN CR.NO.195/2017 (ANNEXURE-B); CHARGE SHEET DATED 26.06.2018 FILED BY THE POLICE INSPECTOR, HEBBAL POLICE STATION (ANNEXURE-C) AND THE ORDER DATED 28.07.2018 PASSED BY THE IV ADDL.C.M.M., BENGALURU IN C.C.NO.20686/2018 (ANNEXURED).

¶21

THIS CRL.P, COMING ON FOR ADMISSION, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

¶22

CORAM: HON'BLE MRS JUSTICE M G UMA

¶23

ORAL ORDER

¶24

The Petitioner being accused No.3 is seeking quashing of the criminal proceedings initiated against him, which is now pending in CC No.20686/2018 on the file of the learned IV Additional Chief Metropolitan Magistrate, Bengaluru for the offence punishable under Sections 406, 420, 120(B) R/w Section 34 of IPC.

¶25

Brief facts of the case are that, respondent No.2 as informant filed the first information with Hebbal Police Station against accused Nos.1 to 8 alleging commission of the offence under Sections 406 and 420 of IPC. It is the contention of

¶26

3 - NC: 2024:KHC:36788 CRL.P No. 6475 of 2019

¶27

respondent No.2 that it engaged in organizing Academic competitions for school going children in the year 2014. It organized nationwide Math Olympiad with attractive cash prices. At that time, accused No.1 through its representatives approached respondent No.2 with the proposal to award insurance policies to the winners of the competition in lieu of cash price. The proposal was accepted by respondent No.2 to issue Insurance Policy for the benefit of students those who have won the competition, identifying the Scheme as 'Aviva Young Scholar Secure Policy Scheme'. It was believed that such issuance of policy would benefit the young students. Accordingly, respondent No.2 remitted Rs.36,89,567/- as first installment out of three installments. Accused have assured that once the entire amount is remitted, they will complete documentations.

¶28

During February 2014, one of the representatives of accused No.1 sent a mail to respondent No.2 and believing the same, respondent No.2 agreed to purchase several insurance policies worth Rs 3,60,00,000/- and the premium was paid. But subsequently, respondent No.2 came to know about the intention of the accused, who have shown their true colours

¶29

4 - NC: 2024:KHC:36788 CRL.P No. 6475 of 2019

¶30

and changing their versions and were resorting to cancellation

¶31

of the policies without due notice and also forfeiting the premium amount paid by respondent No.2. When this conduct of the accused was questioned, they have assured that within 15 days they will prepare the required documents. But there was no progress in that regard. Believing the words of the accused, respondent No.2 utilized their hard earned money of Rs.1,10,00,000/- (One Crore and Ten Lakhs Rupees) and gave it to all students, since original promise was given by respondent No.2 offering the Insurance Policies.

¶32

It is contended that accused No.1 and its representatives indulged in unfair trade practice by making misrepresentation and also acted to cover up their guilt by inappropriate methods including intimidating respondent No.2 to accept the premium amount in return that too after lapse of long time. When it is brought to the notice of the accused that respondent No.2 has resorted to high level escalations and they are not ready to accept suffering of loss due to the acts of the accused, it is alleged that the accused have conspired together with an intention to cover up their misleads and started creating stories stating that the documentation made by

¶33

5 - NC: 2024:KHC:36788 CRL.P No. 6475 of 2019

¶34

respondent No.2 was not correct and therefore they do not honour the commitment given earlier. Respondent No.2 had issued legal notice and filed a complaint with their internal grievance redressal forums. But it is of no avail. It is found that accused No.1 and its management colluding with one another, cheated respondent No.2 to a tune of Rs 5,60,00,000/- (Five Crores Sixty Lakh Rupees). Therefore, respondent No.2 contended that the accused have committed the offence punishable under Sections 406 and 420 read with Section 34 of IPC.

¶35

It is specifically contended that Devangi Sanghi i.e., accused No.3 who is the petitioner herein was the first marketing manager who introduced accused No.1 to respondent No.2 and interacted during initial stages. Therefore, they requested to register the case and to initiate legal action. Accordingly, the FIR in Cr.No.195/2017 of Hebbal police station came to be registered against accused Nos.1 to 8. After investigation, the charge sheet came to be filed against all the eight accused for the above said offences along with Section 120(B) of IPC.

¶36

6 - NC: 2024:KHC:36788 CRL.P No. 6475 of 2019

¶37

As per column No.7 of the charge sheet, it is

¶38

contended that the accused have promised to issue three free policies for having transacted with them. But they were not ready to issue the same. It is also the contention of the prosecution that on 15.02.2014, CW.1 had remitted Rs.30,00,000/- (Thirty Lakhs Rupees) through cheque to the accused, but the same was reverted back to respondent No.2. Accused No.3, even though promised of issuing policies, had not kept up his promise and thereby cheated CW1. It is also stated that on 19.04.2014 an email was sent by the accused to CW1 regretting for the loss suffered and managed to get an amount of Rs.36,89,567/- (Thirty Six Lakhs Eighty nine thousand Five hundred Sixty Seven Rupees) through cheque from CW1 by issuing 35 insurance policies. Accused No.4 misused the letter-head of parents and CW.1 and projected the parents of the students as employees working under CW.1 and also concocted the pay slip. But however later, cancelled the policy by assigning a vague reason as non-submission of documents. Even though E-mails were sent to accused Nos.7 and 8, they have not responded to the same. Accused No.2 being the CEO was not ready to meet CW.1. It is stated that

¶39

7 - NC: 2024:KHC:36788 CRL.P No. 6475 of 2019

¶40

even though accused No.4 admitted the loss caused to CW1 and apologized for the same, and also promised to repay the amount with interest, he insisted CW.1 to sign the settlement deed even when CW1 was not ready to sign the same, thereby, the accused have committed cheating by criminally conspiring with one another and also committed criminal breach of trust. The trial Court took cognizance of the offence and registered CC No.20686/2018 against the accused. Accused No.3 is before this Court seeking quashing of the proceedings against him.

¶41

Heard Sri. Uday Holla, learned Senior Advocate for Sri.Vivek Holla, learned counsel for the petitioner and Smt. Asma Kouser, learned Additional SPP for respondent No.1-State and Sri.K.M.Somashikara, learned counsel for respondent No.2. Perused the materials on record.

¶42

Learned Senior Advocate for the petitioner

¶43

contended that the petitioner is accused No.3. He was working under accused No.1 before March 2014 and he tendered his resignation to his post as Senior Sales Manager. The same was

¶44

accepted by accused No.1 as per relieving letter dated 07.04.2014 produced as per annexure-L. As per this

¶45

8 - NC: 2024:KHC:36788 CRL.P No. 6475 of 2019

¶46

document, the petitioner is relieved with effect from the closure of the working hours on 11.03.2014. Even as per the charge sheet, the only allegations made against the petitioner is that, he introduced accused No.1 to the informant and interacted with it at the initial stages. Apart from that, there is absolutely no allegations against the petitioner to invoke any of the penal provisions as stated above.

¶47

Learned Senior advocate further submitted that the first information filed by respondent No.2 does not make out any criminal offence committed by the petitioner. There was a consultation for getting the policy from accused No.1 and premium of Rs.35,68,536/- was paid by responded No.2 towards 35 policies that were issued. But the said amount along with interest at the rate of 9.75% amounting to Rs.8,17,523/- and the amount of Rs.43,86,059/- was remitted through NEFT to the account of 'Dream world India' towards full and final redressal of the grievance of respondent No.2 as evidenced from the mail dated 11.11.2016. The remittance of the entire amount paid by respondent No.2 along with interest till 03.11.2016 was acknowledged by respondent No.2 by sending reply dated 02.12.2016. However, demanded

¶48

¶49

NC: 2024:KHC:36788 CRL.P No. 6475 of 2019

¶50

Rs.10,00,00,000/towards the so-called loss suffered. Therefore, it is clear that the complainant has approached the police with his imaginary claim towards loss suffered when the amount received is already returned with interest at 9.75%.

¶51

Learned Senior Advocate submitted that when the petitioner being accused No.3 has resigned from his job with effect from 11.03.2014 and when the allegations made by respondent No.2 was from February 2014, specifically stating that the petitioner was the first marketing manager, who introduced accused No.1 to respondent No.2 and interacted in the initial stage assumes importance. It is not the contention of the respondent No.2 that accused No.3 was having any intention at the initial stage, to commit any of the offences and under such circumstances, initiation of criminal proceedings against the petitioner amounts to abuse of process of Court and hence he pays for allowing the petition and to quash the criminal proceedings in the interest of justice.

¶52

Per contra , learned Additional S.P.P, opposing the petition submitted that serious allegations are made against accused No.1 for having committed the offence and all other

¶53

10 - NC: 2024:KHC:36788 CRL.P No. 6475 of 2019

¶54

accused who are either the Officers or the employees working under accused No.1. Accused No.1 in collusion with other accused collected huge sums of amount as premium, but failed to issue insurance policy. Thereby they have committed criminal offences as stated above. After investigation, the charge sheet is filed. Under such circumstances, learned counsel for the petitioner is not entitled for grant of relief as claimed in this matter.

¶55

In view of the rival contentions urged by learned counsel for both the parties, the point that would arise for my consideration is;

¶56

“Whether the petitioner has made out any grounds to allow the petition and to quash the criminal proceedings initiated against her?”

¶57

My answer to the above point is in the affirmative for the following;

¶58

REASONS

¶59

Respondent No.2 filed the first information as per

¶60

Annexure-A, where there is reference to the proposal to award the insurance policy to the winners of the competition and it is

¶61

11 -

¶62

NC: 2024:KHC:36788 CRL.P No. 6475 of 2019

¶63

the contention of respondent No.2 that the accused have collected huge sums of amount in installments, as premium, towards insurance policy that have been issued. Inspite of collecting such amount, the accused have not issued the insurance policy nor they have given free policy as agreed and thereby they have committed the offences punishable under Sections 406 and 420 of IPC.

¶64

The first information produced as per Annexure-A makes it clear that there was a simple contract between respondent No.2 and accused No.1 - Company represented by its Officers for issuance of the insurance policy for the benefit of the students who have won the awards and identified as the winners of the “Aviva Young Scholar Secure” policy Scheme.

¶65

It is the contention of respondent No.2 that a sum of Rs.36,89,567/- was paid to the accused in three installments

¶66

and inspite of that the insurance policy was not issued. Learned senior advocate for the petitioner has drawn my attention to the email dated 11.11.2016 addressed to respondent No.2 where there is reference to refund of premium of Rs.35,68,536/- received towards 35 policies along with

¶67

12 - NC: 2024:KHC:36788 CRL.P No. 6475 of 2019

¶68

interest to the tune of Rs.8,17,523/- calculated at 9.75% from the date of receipt of premium till 03.11.2016. The email also refers to difference amount of Rs.22,337/- which is already cleared in the year 2014 and therefore, it is stated that a total sum of Rs.43,86,059/- was remitted through NEFT to the account of “Dream World India” towards full and final redressal of grievances raised by the complainant. The email in reply dated 02.12.2016 forwarded by respondent No.2 to the accused is also produced for perusal of the Court, according to which, respondent No.2 had not accepted the settlement as they never admitted that the amount is already paid and suggested that they have suffered loss of about Rs.10.00 Crore and the accused is called upon to make good the loss. When the payment of premium by respondent No.2 to the accused and refund of the same along with interest upto date is admitted and when it is the contention of respondent No.2 that he has suffered loss in view of termination of the contract as agreed between the parties, the remedy for respondent No.2 lies elsewhere, but, it will not give rise to the penal provisions either under Section 406 or under Section 420 of IPC.

¶69

13 - NC: 2024:KHC:36788 CRL.P No. 6475 of 2019

¶70

Moreover, the petitioner is relieved from his post from accused No.1 company during first week of March 2014.

¶71

In view of the above, I am of the opinion that institution of the criminal case against petitioner/accused No.3 is in clear abuse of process of law and hence, the criminal proceedings is liable to be quashed. Accordingly, I answer the above point in the affirmative and proceed to pass the following:

¶72

ORDER

¶73

The criminal petition is allowed.

¶74

The criminal case registered against the petitioner - accused No.3 in Crime No.195/2017 of Hebbal Police Station, pending in CC No.20686/2018 on the file of the learned IV Additional Chief Metropolitan Magistrate, Bengaluru City registered for the offences punishable Sections 406, 420, 120(B) R/w Section 34 of IPC, is hereby quashed.

¶75

Sd/(M G UMA) JUDGE

¶76

BH/GH List No.: 2 Sl No.: 26

Devangi Sanghi v. State of Karnataka

Case brief

What is this about?

What did the court decide?

Devangi Sanghi v. State of Karnataka

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

Mahesh T S Vs State of Karnataka

S.B. Shivarudhrappa Vs B.S. Prabhakar

Smt Vanitha Vs State of Karnataka by

Smt. Ashwini D K Vs State of Karnataka

Sri N Balaraju Vs the State of Karnataka

Sri. Kiran. M. S. Vs State of Karnataka by