Dismissed¶67

K.K. Plastics Waste Management Ltd. v. State of Maharashtra

Karnataka HC1 Sept 2025WP/56880/2016

Case brief

AI extract

What is this about?

What did the court decide?

No substantive relief; liberty reserved to the petitioners to work out their remedy in accordance with law. ¶67

K.K. Plastics Waste Management Ltd. Vs State of… — Cheating and Forgery | Karnataka HC (2025)

What the court decided

AI extract

Outcome

No substantive relief; liberty reserved to the petitioners to work out their remedy in accordance with law.

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Issue for consideration

Whether the notices dated 04.07.2016 issued by respondent No.2 (Sarkarwada Police Station, Nasik) were without jurisdiction, given that the petitioners contend the transaction occurred in Bengaluru, the cause of action arose in Bengaluru, and proceedings should have been taken up under the Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2004 rather than the MPID Act. +2 more

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Court's answer

Petitioners aggrieved by the demand to repay are bound to appear before the concerned Court in Maharashtra and establish their claim that they are not liable to return the money.

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Ratio / Principle

Once a crime is registered in Maharashtra, the jurisdictional police are entitled to take all necessary steps to secure back the amounts deposited by the accused in the offence.

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Key takeaways

Both writ petitions are dismissed, with liberty reserved to the petitioners to work out their remedy in accordance with law.ratio¶67

Detailed headnote1 paragraphs

K.K. Plastics Waste Management Ltd. (W.P.No.56880/2016) and Hightek Ecowood (W.P.No.39829/2016), both Bengaluru-based, challenged notices dated 04.07.2016 (Annexure-F, O.W.No.4298/16; Annexure-J, O.W.4302/2016) issued by respondent No.2, Sarkarwada Police Station, Nasik City, in pursuance of Cr.No.34/2016 registered under Sections 420, 406 and 120B read with 34 IPC, Sections 3 and 4 of the MPID Act, 1999 and Sections 3, 4, 5 and 6 of the Prize Chits and Money Circulation Schemes (Banning) Act, 1978. The notices called upon the petitioners to treat amounts received from respondent No.3 (Rs.3,00,00,000/- by K.K. Plastics against undelivered 49% equity; Rs.10,52,50,000/- invested in Hightek Ecowood) as loans repayable with interest for disbursement to investors in respondent No.3. Petitioners contended the transaction and cause of action arose in Bengaluru, that proceedings should have been under the KPID Act, 2004, that the police had no jurisdiction to demand repayment, and that the investments were bonafide with a documentary trail. Held (R. Nataraj, J.): once a crime is registered in Maharashtra, the jurisdictional police are entitled to take all necessary steps to secure back the amounts deposited by the accused; aggrieved petitioners are bound to appear before the concerned Court in Maharashtra and establish their claims. Both writ petitions were dismissed, with liberty reserved to work out their remedy in accordance with law.

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NC: 2025:KHC:34177 WP No. 56880 of 2016 C/W WP No. 39829 of 2016

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HC-KAR

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 1^ST DAY OF SEPTEMBER, 2025

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BEFORE

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THE HON'BLE MR. JUSTICE R. NATARAJ WRIT PETITION NO. 56880 OF 2016 (GM-POLICE) C/W WRIT PETITION NO. 39829 OF 2016 (GM-POLICE)

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IN WP No.56880/2016

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BETWEEN:

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K.K. PLASTICS WASTE MANAGEMENT LTD., NO.50, 1^ST FLOOR, OPPOSITE POST OFFICE, YELACHENAHALLI, KANAKPURA ROAD CROSS, BANGALORE-560078. REP. BY ITS DIRECTOR MR. AHMAD KHAN

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…PETITIONER

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(BY SRI. GOVARDHAN REDDY J.S., ADVOCATE FOR SRI. ISMAIL ZABIULLA, ADVOCATE)

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AND:

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Digitally signed by SUMA Location: HIGH COURT OF KARNATAKA

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STATE OF MAHARASHTRA THROUGH ITS SECRETARY DEPARTMENT OF HOME AFFAIRS MANTRALAYA, MADAM CAMA ROAD, NARIMAN POINT, MUMBAI-400032

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SENIOR INSPECTOR OF POLICE SARKARWADA POLICE STATION NASHIK CITY POLICE MAHARASHTRA-422001.

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MAITRI REALTORS AND CONSTRUCTIONS PVT. LTD. NO.4, HAUDIN ROAD ULSOOR, BANGALORE, KARNATAKA-560042. REP. BY ITS MANAGING DIRECTOR

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NC: 2025:KHC:34177 WP No. 56880 of 2016 C/W WP No. 39829 of 2016

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HC-KAR

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WEST COAST VENTURES (INDIA) PVT. LTD. NO.4, HAUDIN ROAD, ULSOOR, BANGALORE KARNATAKA-560042. REP. BY ITS MANAGING DIRECTOR

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…RESPONDENTS

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[NOTICE SERVED ON RESPONDENT NOS.2 AND 3;

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NOTICE SERVED ON RESPONDENT NO.4 AND UNREPRESENTED (VIDE ORDER DATED 01.09.2025, MEMO OF RETIREMENT FILED BY ADVOCATE FOR RESPONDENT NO.4 IS ACCEPTED)]

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THIS WP IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ANNEXURE-F NOTICE O.W.NO.4298/16 DATED 04.07.2016 ISSUED BY RESPONDENT NO.2 AS WITHOUT JURISDICTION AND WITHOUT BASIS IN LAW.

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IN WP NO. 39829/2016:

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BETWEEN:

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HIGHTEK ECOWOOD REGISTERED OFFICE AT NO.110, 11^TH MAIN, III PHASE, GIRINAGAR, BENGALURU-560085 REPRESENTED BY ITS MANAGING PARTNER MR. HARSHA S/O H.V.L.K. MURTHY AGED ABOUT 34 YEARS,

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...PETITIONER

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(BY SRI. SARAVANA S., ADVOCATE)

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AND:

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STATE OF MAHARASHTRA BY THE SECRETARY TO THE DEPARTMENT OF HOME AFFAIRS, MUMBAI-400001

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3 - NC: 2025:KHC:34177 WP No. 56880 of 2016 C/W WP No. 39829 of 2016

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HC-KAR

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INSPECTOR OF POLICE SARKARA WADA POLICE STATION, NASIK CITY POLICE MAHARASHTRA-422001

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M/S WEST COAST VENTURES (INDIA) PVT. LTD., NO.4, HOUSIN ROAD, ULSOOR, BANGALORE-560042 REPRESENTED BY ITS DIRECTOR

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VARSHA SATPALKAR REPRESENTED BY DIRECTOR, M/S MAITREYA REALTORS AND CONSTRUCTIONS PVT. LTD., 'MAITREYA HOUSE', 2^ND AND 3^RD FLOOR, CTC 789, OPP. COSMOS BANK, HANUMAN ROAD, VILE PARLE (EAST) MUMBAI-400057

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...RESPONDENTS

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(BY SRI. G.V.RAVI, ADVOCATE FOR RESPONDENT NO.3; SRI. S.B.MATHAPATHI, ADVOCATE FOR RESPONDENT NO.4; NOTICE SERVED ON RESPONDENT NOS.1 AND 2)

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THIS WP IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH ANNEXURE-J NOTICE ISSUED BY 2^ND RESPONDENT DATED 04.07.2016 IN O.W.4302/2016 AS WITHOUT JURISDICTION AND INFESTED WITH MALICE.

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THESE PETITIONS, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

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CORAM: HON'BLE MR. JUSTICE R. NATARAJ

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ORAL ORDER

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The petitioners in both these petitions have challenged a

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notice dated 04.07.2016 issued by the respondent No.2 - Sarkarwada Police station, Nasik city in pursuance of

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4 - NC: 2025:KHC:34177 WP No. 56880 of 2016 C/W WP No. 39829 of 2016

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HC-KAR

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Cr.No.34/2016 registered under Sections 420, 406 and 120B read with 34 of Indian Penal Code and Sections 3 and 4 of the Maharashtra Protection of Interest of Depositors (in financial establishments) Act, 1999 (henceforth referred to as 'MPID Act' for short) and also Sections 3, 4, 5 and 6 of The Prize Chits and Money Circulation Schemes (Banning) Act, 1978.

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The petitioner in W.P.No.56880/2016 appears to have received a sum of Rs.3,00,00,000/- from respondent No.3 as investment in the petitioner against transfer of 49% equity shares. Later, the respondent No.3 issued a cheque for another sum of Rs.3,00,00,000/-. However, the terms of investment which was to be reduced into writing, did not fructify and therefore the petitioner did not deposit the cheque for Rs.3,00,00,000/-. The petitioner contends that it was alleged that the sum of Rs.3,00,00,000/- received by the petitioner was part of the investment made by many depositors which was diverted by M/s.Maitreya Plotters and Structures Private Limited against whom Cr.No.34/2016 was registered for the offences mentioned above. It is alleged that since the petitioner did not transfer the equity shares, the impugned notice was

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5 - NC: 2025:KHC:34177 WP No. 56880 of 2016 C/W WP No. 39829 of 2016

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HC-KAR

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issued informing it that the amount paid to it would be treated as a loan. The petitioner is therefore before this Court challenging the said notice.

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The petitioner in W.P.No.39829/2016 claims that respondent No.3 had evinced interest to invest in it and proposed to invest Rs.15,00,00,000/- against 49% stake. The petitioner contends that between 24.07.2013 to 07.12.2013 a sum of Rs.10,52,50,000/- was invested in it through various entities including respondent No.3. Later, an agreement was entered into between the petitioner and respondent No.3 on 05.02.2014 in respect of investment of Rs.15,00,00,000/- and it was agreed that the amount invested would be converted into subscription amount for subscribing to equity or preferential shares after the petitioner was converted into a company. However, due to delay in conversion of the petitioner firm to a company, the firm was re-constituted by inducting a representative of respondent No.3 as a partner with 49% stake in the firm. The petitioner has referred to many other facts which are not necessary to decide this petition. The petitioner contends that it came to know that various depositors had

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6 - NC: 2025:KHC:34177 WP No. 56880 of 2016 C/W WP No. 39829 of 2016

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HC-KAR

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invested in the respondent No.3 who promised them returns. The petitioner contends an investor had lodged a complaint against respondent No.3 that he had invested Rs.1,00,00,000/into the petitioner through respondent No.3 and that he was cheated of the investment. Hence, a case in Cr.No.34/2016 was registered under Section 406, 420 and 120-B of IPC read with Sections 3 and 4 of MPID Act and Section 3, 4, 5 of PCMC Act. The petitioner contends following registration of Cr.No.34/2016, a impugned notice was issued informing the petitioner that the amount received by it would be treated as a loan and that it is bound to repay the amount along with interest for disbursement to the investors in respondent No.3. The petitioner is therefore, before this Court challenging the said notice.

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The petitioner in both these petitions submits that

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the transaction in question happened in Bengaluru and therefore, the cause of action arose in Bengaluru and hence, the proceedings must have been taken up in Bengaluru under the Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2004 (henceforth referred to as 'KPID Act',

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7 - NC: 2025:KHC:34177 WP No. 56880 of 2016 C/W WP No. 39829 of 2016

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HC-KAR

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and not under the MPID Act. They contend that the police also have no jurisdiction to call upon the petitioners to repay the amount on whatever ground. They further contend that the investments were bonafidely made and there is a trail of documents evidencing the transactions and therefore, the amounts demanded from them by treating it as a loan is not only illegal but also unjust.

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It appears from the notices impugned that the case in Cr.No.34/2016 was registered by the Sarkarawad Police Station, Nasik city, by investors in respondent No.3. During the course of investigation, it was revealed that the promoters of M/s. Maitreya Realtors and Constructions Private Limited had parted with sum of Rs.3,00,00,000/- to the petitioner in W.P.No.56880/2016 to purchase equity shares in it. It also appears that the promoters of petitioner in W.P.No.56880/2016 did not transfer the equity shares, meaning thereby that the said petitioner was in possession of funds of respondent No.3. If once a crime under the KPID Act is registered in Maharastra, the jurisdictional police are entitled to take all necessary steps

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8 - NC: 2025:KHC:34177 WP No. 56880 of 2016 C/W WP No. 39829 of 2016

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HC-KAR

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to secure back the amounts deposited by the accused in the aforesaid offence.

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Similarly, the petitioner in W.P.No.39829/2016 had received a sum of Rs.10,52,50,000/- as investment in it against 49% stake. It appears that the petitioner and respondent No.3 failed to adhere to the terms of agreement relating to investment. Consequently, respondent No.3 was bound to answer the claims of its depositors. The jurisdictional police have issued a notice calling upon the petitioner in both the petitions to repay the amount by treating the money received by them as a loan. If the petitioner in both the petitions are aggrieved, they are bound to appear before the concerned Court in Maharastra and establish their claim that they are not liable to return the money.

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In that view of the matter, these writ petitions are dismissed . However, liberty is reserved to them to work out their remedy in accordance with law.

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Sd/(R. NATARAJ) JUDGE

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List No.: 1 Sl No.: 2

K.K. Plastics Waste Management Ltd. v. State of Maharashtra

Case brief

What is this about?

What did the court decide?

K.K. Plastics Waste Management Ltd. v. State of Maharashtra

Case brief

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