Partly allowed

Mr. Ramesh Kumar Bung v. The State of Telangana

Telangana HC13 Sept 2023CRLP/2370/2021

Case brief

AI extract

What is this about?

Two Section 482 Cr.P.C. petitions sought quashing of FIRs alleging en masse admission of gold loanees as members and fraudulent loan disbursement by a cooperative bank's office bearers. The court held the affidavit requirement for a Section 156(3) complaint directory, found prima facie offences made out, quashed the Section 420 IPC charge in one FIR and dismissed the other.

What did the court decide?

Crl.P. No. 2370 of 2021 partly allowed; offence under Section 420 IPC in FIR No. 218 of 2021 quashed, FIR for remaining offences sustained. Crl.P. No. 2371 of 2021 dismissed.

Mr. Ramesh Kumar Bung Vs The State of Telangana — Cooperative Societies | Telangana HC (2023)

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[³²¹⁶ ]

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IN THE HIGH COURT^{FORTHE STATE OF TELANGANA} AT HYDERABAD

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WEDNESDAY, THE THIRTEENTH^{DAY OF SEPTEMBER} TWO THOUSAND AND TWENTY^THREE

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PRESENT

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THE HONOURABLE SRI JUSTICE M.LAXMAN

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CRIMINAL PETITION^NO: 2370^{AND 2371OF 2021}

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CRIM INAL PETITION NO: 2370 OF²⁰²¹

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Between:

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Mr. Ramesh Kumar Bunq, Son^{of Late lvlr. Ramprasadji Bung, Aged 56 years,} Chairman, A.P. Mahesh Cooperative^{Urban Bank,Regd. Off. 8-2-68011 and 2,} Road No.12, Banjara Hills, Hyderabad^{- 500034.}

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Mr. Umesh Chand Asawa, Son of^{Late Mr. Radhakishanji Asawa, Aged 59} vears. Manaqinq Director and^{CEO,A.P. MaheshCooperativeUrbanBank,} hegO. Off O-Z--O5O t1 and 2, Road^{No.12, Banjara Hills, Hyderabad - 500034.}

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Ivlr. Purshotamdas Mandhana,^Son of Late^{Mr. Govindlaliil\4andhana, Aged} 65 years, Sr. Vice Chairman, A.P. Mahesh^{CooperativeUrban Bank,Regd.} Off.8-2-680/1 and 2, Road No.12,^{Ban.iara Hills, Hyderabad- 500034.}

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..PETITIONERS/ACCUSED NO.s 1 TO 3

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AND

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1 The State of Telangana, Rep. by^{StationHouseOfficer, Baniara Hills Police} Station, Hyderabad Through Public^{Prosecutor,High Courtfor the State of} Telangana at Hyderabad.

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2 A.P. Mahesh Cooperative Urban^Bank Shareholders^{Welfare Association,} Rep. by its Secretary, Mr. Shyam Sunder^Biyani, R/o.^{3-6-102/A, Flat No. 403'} Janapr'iya Grandeur, St. No. 18,^{Himayatnagar, Hyderabad- 29}

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.RESPONDENTS

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Petition under Section 482 of Cr-P.C^praying that^{in the circumstances} stated in the Memorandum of Grounds of^{Criminal Petition, the High Court maybe} pleased to call for the records in relating to FIR No. 218 of 2021 on the file of Banjara Hills Police Station, Hyderabad^{and quash} the^same

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LA. NO: 1 OF 2021 lN CRLP 2370 OF 2021

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Petition under Section 482 of Cr.P.C praying that in the circumstances stated in the l,4emorandum of Grounds of Criminal Petition, the High Court n'ray be pleased to stay of all further proceedings including the arrest of the petitioners in relation to FIR No 218 of 2021 on file of Banjara Hills Police Station, Hyderabad, pending disposal of the above petition

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CRIMINAL PETITION NO: 2371 OF 2021

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Between:

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Mr. Ramesh Kumar Bung Son of Late IVlr. Ramprasadji Bung, Aged 56 years, Chairman, A.P. Mahesh Cooperative Urban Bank, Regd. Off..8-2-680/tand2, Road No. 12, Banjara Hills, Hyderabad - 500034.

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lrilr. Umesh Chand Asawa, Son of Late Mr. Radhakishanji Asawa, Aged 59 years, Managing Director and CEO, A.P. Mahesh Cooperative Urban Bank, Regd. Off.. 8-2-68Ol1and2, Road No.12, Banjara Hills, Hyderabad - 500034.

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Mr. Purshotamdas lvlandhana, Son of Late Mr. Govindlalji Mandhana, Aged QQ^{years, Sr. Vice Chairman, A.P. Mahesh Cooperative Urban Bank,Regd.} Off..8-2-680/1and2, Road No.12, Banjara Hills, Hyderabad - 500034

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...PETITIONERS/ACCUSED NO.1 TO 3

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AND

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The State of Telangana Rep. by Station House Officer, Banjara Hills Potice Station, Hyderabad Through Public Prosecutor, High Court for the State of Telangana at Hyderabad.

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2 A.P Mahesh Cooperative Urban, Bank Shareholders Welfare Association, Rep. by its Secretary, Mr.Shyam Sunder Biyani, Rtio. 3-6-102/A, Flat No. 403, Janapriya Grandeur, St. No. 18, Himayalnagar, Hyderabad - 29.

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...RESPONDENTS

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Petition under Section 482 ol'Cr.P.C praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition, the High Court may be pleased to call for the records in relating to FIR No. 222 of 2021 on the file of Banjara Hills Police Station, Hyderabad and quash the same

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l.A. NO: 1OF 2021 lN CRLP 2371 OF 2021

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Petition under Section 482 of Cr.P.C praying that in the circumstances stated in the lVemorandum of Grounds of Criminal Petition, the High Court may be pleased to stay of all further proceedings including the arrest of the petitioners in relation to FIR No. 222 of 2021 on the file of Banjara Hills Police Station, Hyderabad, pending disposal of the above criminal petition

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r.A. NO i20F 2022 rN CRLP 2371 C)F2!4

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Petition under Section 482 of Cr.P.C^praying that^{in the} circumstances stated in the Memorandum of Grounds of Criminal Petition, the High^Courtmay be pleased to direct Respondent No 4 to file a status report of the^{investigation} done in FIR Nos. 21812021 and 22112021 both registered at^{PS BanjaraHills,} Hyderabad u/s 120 B R:/w 409, 42O, 467, 468, 471, 477-A IPC with effect from 26.10.21, when the common interim order of this Hon'ble Court dated 27.04.21 had automatically lapsed by efflux of time

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These Petitions coming on for hearing, upon perusing the Memorandum of Grounds of Criminal Petition and upon hearing the arguments of It//S N NAVEEN KUMAR, Advocate for the Petitioners and the Public Prosecutor on behalf of the Respondent No.1 and of Sri H RAJESH KUMAR, Advocate for the Respondent No. 2

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The Court made the following: COMMON ORDER

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THE HONOURABLE SRI JUSTICE M. LAXMAN

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CRIMINAL PETITION Nos.2370 AND 2371 OF 2021

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COMMON ORDER:

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Since the issue invotved in both the petitions is atmost one and the same, they are being disposed of by way of this common order.

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Crt.P.Nos.237O and 2371 of 2021 are filed under Section 482 of Code of CriminaI Procedure (for short 'Cr.P.C') by the petitioners/accused Nos.1 to 3 to quash proceedings in Crime Nos.218 and 222 of 2021 respectively on the fite of Banjara Hitts Potice Station, Hyderabad. Crime No.218 of 7021 was registered for the offences punishabte under Sections 120-8, 409, 420, 467, 468, 471 and 477.A of the lndian Penal Code, 1870 (for short 'lPC') and Crime No.222 of 2071 was registered for the offences punishable under Sections 120-8, 409, 420, 467, 468, 471 and 477-A of the IPC and Section 156 (3) of Cr.P.C.

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The petitioners in both the crimina[ petitions are accused Nos.1 to 3 in the said crimes and respondent No.2 in both the criminal petitions is the complainant.

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Facts in Crl.P.No.2370 of 2021:

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The comptainant fited an apptication under Section 156(3) of Cr.P.C before the lll Additionat Chief Metropotitan Magistrate, Hyderabad [for short 'Court betow'] seeking direction to the Station r

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House Officer, Banjara^{Hitts PoticeStation,Hyderabad,to regrstera} case against the^{petit.ioners herein for the offencesunderSections} 120-B read with Sectrons 409,470,467,468,471^{and 477-AofIPC and} to conduct investigation. Upon the^{directionsgiven by the Court} betow, an FIR was^{registered in CrimeNo.218 of 2071 for the said} offences.

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The contents of the said FIR woutd show^{that accused No.1 is the} Chairman [erstwhite Senior^{Vice Chairman],accusedNo.2 is the} Managing Director and CEO, accused No.3^{is the ViceChairman} [erstwhite^{Chairman]of the A.P.Mahesh Cooperative Urban Bank(for} short 'the Bank'). The comptainant^is the^{Secretary of A.P.Mahesh} Cooperative Urban Bank Sharehotders'^{WetfareAssociation.On} 31 .10.2020, the Board of management of^{the Bank had conveneda} General Body Meeting for conducting etections^to the^{Bank wherein it} has been resotved to conduct elections^{to the bank on 20.12-2020. The} accused, who were then board of directors,^{fearing that if theytost in} the etections, a newty etected Board^{would go into the forensic audit,} which woutd bring to tight the^{grave irregutarities doneduring their} tenure, conspired with accused No.4 [Returning^{Officer] and inducted} gotd loanees as Ordinary/'A' ctass members in the^Bankfrom O?.11 .ZOZ0 to 13.11.2020 without fottowing^{due processof [aw. The} accused admitted 920^gotdtoanees as'A'class^{members in the Bank'}

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The cut-off date of voters list was 17.11.7070. On 16.11.2020 another 243 gotd loanees were made as'A'ctass members and on the last date i.e., 17.11.2020 further 636 gotd [oanees were made as 'A' class members. ln att, 1800 gotd loanees were admitted as members from 02.11.7070 to 17.11.2070. The famity members of bank employees were also admitted as'A'ctass members by extending gotd toans. This shows the compticity of the Board members with the emptoyees of the bank. Such gotd toans were extended to the members even without their physicat presence before the bank and without furnishing any security and atso without report from the gotd appraiser. Further, they were atl permitted to participate in the etections process, in cotlusion with accused No.4 contrary to the Master Circutar issued by the Reserve Bank of lndia, which stiputates that newly inducted members are entitted to vote onty after 12 months from the date of their membership. ln the said circumstances, he fited the complaint.

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Facts in Crl.P.No.2371 of 2021:,

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The comptainant fited another apptication under Section 156(3) of Cr.P.C before the Court betow seeking direction to the Station House Officer, Bangaja Hitts Potice Station, Hyderabad, to register a case against the petitioners herein for the offences under Sections 120-B read with Sections 409, 420,467, 468,471 and 477-Aot IPC and to conduct investigation. Upon the directions given by the Court

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betow, an FIR^{was registered in CrimeNo.222 of 7071 for the said} offences.

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The contents of the FIR would show that the Petitioners^herein in conspiracy with unknown others have disbursed^{the [oans to the} famity members of Board of^{Directorsand major sharehotdersof the} bank to a tune of Rs.20,73,00,000/-^{(Rupees Twenty CroresSeventy} Three Lakhs onty). Such disbursements^{were concealed in theBooks of} Accounts and atso suppressed such^{loans in the annual reportsat the} retevant cotumn by referring 'nit' loans extended^tothe relatives/companies' in which Board^{of Directors were having interest.} Such acts amount to criminal breach of trust,^{forgery of documents,} fatsification of accounts and cheating the bank.

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The contents of the FIR woutd further show that accused^{No.1 in} conspiracy with accused Nos.2, 3 and others had^{disbursed loansworth} of more than Rs.300,0O,0O,OOO/-^{(Rupees Three Hundred Crores Onty)} to various entities by securing^{ittegaI cottaterats, such as tands} betonging to Wakf Board and^{non-existing propertiesby charging} commission of 2% to 10% for disbursement^{of such ittegat loans. Such} disbursement was not referred^{in the annualreports of the Bank. lt is} averred in the FIR that huge amounts^{were spent on construction of} buitding for the bank with highty^{inftated rates, and withoutapprovat} of the sharehotders in ,:"j..r", O"l"ru, f4eeting.^{On accountof such}

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acts, the bank incurred huge [oss to a tune of Rs.18.]0 crores. Further, for the financraI years 7018-19 and 2019-20, the accused misappropriated Rs.3 crores and Rs.3.5 crores respectivety by submitting fatse bitts without reftecting the same in 44th annual report under the head 'detaits of other expenses'. On account of such large scate fraud, the interest of the bank was put in^jeopardy and such acts amount to criminal breach of trust, cheating, fatsification of accounts and forgery of documents.

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The contention of the learned counsel for the petitioners / accused is that the comptainant was the defeated candidate in the etectron for Directorship, and he fited the^present comptaints with a matafide intention with att fatse attegations. Thus, the said proceedings are required to be quashed. lt is his further contention that the FlRs do not disctose the commission of any offence against the petitioners. The contents of the FIR and the writ^petition are one and the same. The comptainant white fiting the^present comptaints did not mention about the^pendency of writ^{petition. As} such, there is conceatment of facts by the comptainant.^Therefore,on that ground atso, the FlRs are tiabte to be^quashed. Learned counsel further contended that the attegations in FlRs are based on^the surmises and conjectures^apd Gr^{from the} truth.^{The complainant fited}

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the comptaints^{onty to takevengeance against the petitioners'who} won the etection.

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lt is atso his^{further contention that the Court betow faited to} see that white issuing^{direction under Section156(3)of Cr.P.C,the} comptainant did^{not fite affidavitverifying the contentsof comptaints,} as directed by the^{ApexCourt in Priyanka Srivastova v. Stote of} U.P'. Non-comptiance^{of such directionsvitiates the proceedings and it} is a ground to^quash the^{proceedingsas hetdby the Apex Courtin Bobu} Venkatesh v. The State of^{Kornatako'.The sameprinciplehas been} fol,towed by this Court in^{T.Komolakor v- Stote of Telongano3,} D.Satish kumor v. State of^{Telongonaaand Chondrasekhar Reddy v'} Public Prosecutor, Hyderabads.^{He hastastty contended that if the} attegations in the comptaints^{are taken to be true, the offencesatteged} in the FlRs are not attracted^{against the petitioners. Therefore, the} proceedings are liab[e to be^quashed

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The tearned counsel for the^{comptainantsubmitted that the} scope of interference of^{this Court at the initiatstage of FIR is very} narrow. At that stage, this^{Court cannot statl the investigationand} cannot decide the merits^{and demerits of allegations and it mustbe}

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'2015^{(6) scc 287} '?^{MaNU/sc/02tql2022}

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'^{MANU/TLl0569/2022}

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o MANU/TLto646l2o22

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5 2023 SCC Online AP 995

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left to the investigating agency. He has further corrtended that the contents of the FlRs ctearly suggest that there are attegations of fraud, forgery, criminaI breach of trust, falsification of accounts and conceatment of facts, which ctearly make offences atteged in the FlRs. Truth or otherwise of such attegatrons cannot be tested in the present proceedings. He has further submitted that even there is matice or act of vengeance on the part of the comptainant in fiting the comptaints, if the attegations are substantiatly true, the matice and vengeance conduct of the comptainant has no significance and such motive toses its retevancy. The investigating agency shatt be attowed to proceed with the investigation to find out whether any offence has been committed or not.

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lt is his further contention that the directions^given in Priyanka Srivastava's case (supra) for fiting an affidavit is directory in nature and it is part of procedure. A simitar obligation is casted upon the Magistrate to insist for the affidavit before the comptaint was referred under Section 156(3) of Cr.P.C. lf such an obligation had been discharged by the Magistrate, the comptainant coutd have rectified such a defect by comptying direction.^Though there is a direction to fite an affidavit along with the comptaint, such direction is only for the purpose of fixing the attegiance to the altegations made in the comptaint on sworn affidavif The warrant for^giving a direction that

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an apptication^{underSection156(3) of Cr'P'C', be supportedby an} affidavit so^{that the person makingthe apptication shoutd be conscious} and atso endeavour^{to see that no fatse attegatronis made' Oncean} affidavit is found to^{be fatse,he woutd be tiabte for prosecution in} accor:dance with taw.^{Therefore, the requirementis only a procedural} one and non'compliance^{of the same does not vitiate the entire} proceedings. lt is a curable defect^{that canbe rectified at any stage'}

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He has further^{contended that the Apex Court inBabu} Venkatesh's case^{(supra)had not quashed the proceedings on the} ground of non-fiting of affidavit.^{ln fact, the ApexCourt had found that} the attegations^{madethereinretate to civil transactionsand such} comptaints were^{fited af ter11/tyear from the date of fiting of written} statement in the^{civit proceedingsand such a comptaintwas fi[ed with} an ulterior motive to^{harass the accusedtherein. ln that background,} the Apex Court^{hetd that the case of the accused fatts under category} No.7 of decision of^{Apex Court in Stote of Haryana v'. Ch. Bhajon} Lal6. Having hetd so, the^{Apex Court also took note of faiture of} Magistrate in not^{comptying directionsin Priyanka Srivastava'scase} (supra). There is no clear finding^{in the saiddecision to the effect that} non-fiting of affidavit^{atone is a groundto quash the proceedings'}

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6 1992 AIR 604

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Lastty, he has contended that the attegations made in the present complaints found substantiatty true and requires investigation in the background of the inquiry report submitted by the^{Reserve Bank} of lndia into the affairs of the bank. Therefore, it is a fit case for thorough investigation to save the innocent sharehotders of the bank by protecting the interest of the bank.

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ln the above background, this Court take up the issue of noncomptiance of directions of the Apex Court in Priyanka Srivastava's case (supra) retating to non-fiting of affidavit along^{with the} complaints fited under Section 156(3) of Cr.P.C., seeking^directionto the concerned Potice to register the case.

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There is no dispute that the Magistrate, having^{jurisdiction,can} act under Section 156(3) of Cr.P.C., to order^{investigation retating to a} comptaint submitted by the comptainant. lt^is also^not in^{dispute that} there is no^provision under the Criminal^{Procedure Code requiringto} fite an affidavit verifying the truthfutness of the^{altegationsmadein} the comptaint, in which a direction is^{sought from the Magistrateto} order investigation by exercising^{power underSection156(3)of Cr.P.C.} ln Priyanka Srivastava's case^{(supra), the Apex Court hetd as fotlows:}

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"27. Regard being had to^{the aforesaidenunciationof [aw, it needs to} be reiterated that the learned Magistrate^{has to remain vigitantwith} regard to the attegations made and the nature of attegations and^not to issue directions without^{proper application} of mind.^{Hehas atso to} bear in mind that sending the matter woutd be conducive to^justice

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and then he may^pass the requisite^{order.The present is a case where} the accused persons are serving^{in highpositions in the bank. We are} absotutety conscious that the^{positiondoes not matter,for nobodyis} above the [aw. But, the^{learned Magistrate shou(d take note of the} attegations in entirety, the date of^{rncidentand whetherany} cognizabte case is remotety made out.^{lt is atso to be noted that when} a borrower of the financial institution^{coveredunder the SARFAESI} Act, invokes the^jurisdiction under^{Section 156(l)Cr.P.C. andatso} there is a separate^procedure under^{the Recovery of DebtsDue to} Banks and Financia[ lnstitutions Act,^{1993,an attitude of more care,} caution and circumspection^has to be adhered^to.

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lssuing a direction stating^{"as per} the^{appIication"to lodgeanFIR} creates a very unhea[thy situation in the^{societyand atsoreftects the} erroneous approach of the learned^{Magistrate.lt atsoencourages the} unscruputous and unprincipted titigants, Iike^{Respondent No.3,} namety, Prakash Kumar Bajaj, to take^{adventurous steps withcourts} to bring the frnanciat institutions on^{their knees.As the factuaI} exposition woutd reveat, respondent^{No.3 had prosecutedthe earlier} authorities and after the matter^is deatt^{withby the High Court in a} writ petition recording a setttement,^{he doesnot withdraw the} criminal case and waits for some^{kind of situation wherehe can take} vengeance as if he is the emperor of a[[^he surveys.^{lt is interesting to} note that during the tenure of appettant^No.'1 ,^{who is presently} occupying the^position of Vice-President,^{neither was the loan taken,} nor was the default made, nor^was any^{action under theSARFAESI Act} was taken. However, the action under^{the SARFAESI Act was taken on} the second time at the instance of the^present appettant^{No.1. We are} onty stating about the devitish^{designof respondentNo.3 to harassthe} appettants with the sote intent to avoid the^{paymentof [oan. Whena} citizen avaits a [oan from a financial^{institution, it is his obtigation to} pay back and not ptay truant or for that matter^{ptay possum.} As we have noticed, he has been able to do^{suchadventurous actsas he has} the embedded conviction that^{he witl not be taken to task becausean} apptication under Section 156(3) Cr.P.C.^{is a simpte apptication to the} court for issue of a direction to the investigating agency.^{We have} been apprised that a carbon copy of a document^{is fitedto show the} compliance with Section 154(3), indicating it^{has been sent} to^the Superintendent of^police concerned.

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At this stage it is seemly to state that^{power under Section156(3)} warrants apptication of^judicial mind.^A court^{of law is involved. lt is} not the^police taking^steps at the stage^{of Section 154 of the code.A} titigant at his own whim cannot^invoke the^authority of^the Magistrate. A principted and reatty^grieved citizen^with clean^hands must have free access to invoke the said^power. lt^protectsthe citizens but when^pervert [itigations takes this^route to^{harass their} fe[tows citizens, efforts are to^be made to scuttte^{and curbthe same.}

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ln our considered opinion, a stage has come in this country where Section '1 56(3) Cr.P.C. apptications are to be supported by an affidavit du[y sworn by the apptican[ who seeks the invocation of the jurisdiction of the Magistrate. That apart, in an appropriate case, the learned Magistrate woutd be wetl advised to verify the truth and atso can verify the veracity of the attegations. This affidavit can make the appticant more responsible. We are competted to say so as such kind of apptications are being fited in a routine manner wjthout taking any responsibitrty whatsoever onty to harass certain persons. That apart, it becomes more disturbing and atarming when one tries to pick up peopte who are passing orders under a statutory provision which can be chattenged under the framework of said Act or under Articte 226 of the Constitution of India. But it cannot be done to take undue advantage in a criminal court as if somebody is determined to settle the scores.

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We have atready indicated that there has to be prior apptications under Section 154(1) and 154(3) white fiting a petition under Section 156(l). Both the aspects shoutd be ctearty spelt out in the apptication and necessary documents to that effect shatt be fited. The warrant for giving a direction that an apptication under Section 156(3) be supported by an affidavit so that the person makinq [he application shoutd be conscious and atso endeavour to see that no false affidavit is made. lt is because once an affidavit is found to be fatse he wit[ be liablq^{fof prosecutionin accordance with [aw.Thiswitt deter him to} casualtv invoke the authoritv of the Ma^qistrate under Section 156(3). That apart, we have atready stated that the veracity of the same can atso be verified by the learned Magistrate, regard being had to the nature of altegations of the case. We are compet[ed to say so as a number of cases pertaining to fisca[ sphere, matrimoniat dispute/famity disputes, commerciaI offences, medicaI negtigence cases, corruption cases and the cases where there is abnormal detay/taches in initiating criminal prosecution, as are i[[ustrated in Lalita Kumari are being fited. That apart, the learned Magistrate would atso be aware of the delay in lodging of the FlR."

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A reading of the above^judgment, it is ctear that the facts therein disctose that the defaulter of the loan was trying to impticate higher officiats of the bank to settte the scores in order to avoid proceedings under the SARFAESI Act. ln the said context, the Apex Court has noted that while ordering such investigation, the Magistrate

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must be vigitant with regard to attegations^{made ln the comptaintand} not to issue any directions without^proper apptication of^mind. However, the Magistrate sha[[ take note of attegations in entirety, the date of incident and whether any cognizable case is remotely made out. lt was found that issuing a direction stating^"as per the apptication" to todge an FIR creates a very unheatthy situation in the society and atso reftects the erroneous approach of the learned Magistrate. lt was atso found that the affidavit is required for the reason that the person making the apptication shoutd be conscious and atso endeavour to see that no fatse affidavit is made. ln the event, if the contents of such affidavit are found fatse, he would be liabte for prosecution in accordance with [aw. This means, the purpose of fiting affidavit is onty to fix tiabitity for^prosecution in the event the attegations are found to be false. Further, in the same^judgment, a direction was given to circutate the^judgment to the concerned Magistrates, so that Magistrates would be more vigitant and diligent white exercising powers under Section 156(3) of Cr.P.C. This means, an obtigation was atso casted upon the Magistrates to insist for the affidavit. Unfortunately, in spite of ctear taw taid down by the Apex Court and such directions of the Apex Court are circutated to the concerned Magistrates, so that they can be vigitant and ditigent white exercising^powers under Section 156(3) of Cr.P.C., the Magistrates are not comptying directions. Had this vigitance and ditigence been

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exercised at the scrutiny stage, the comptainant woutd have had the opportunity to rectify such defect, but this opportunity has been lost.

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ln Bobu Venkotesh's case (supra), the Apex Court has not specificatty hetd that non-fiting of affidavit alone vitiates the proceedings, and it is a ground for quashment of FlR. ln this regard, it rs retevant to refer paragraph Nos.22, 25 to 29 of the said^judgment, whrch read as under:

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"27. We find that in the present case, though civit suils have been fited with regard to the same transactions and thouqh they are contested by the respondent No. 2 by fiting written statement, he has chosen to fite comptaint under Section^'1 56(3) of the Cr.P.C. after a penod of one and hatf years from the date of filinq of written statement wrth an utterior motive of harassing the appettants. We find that, the^present case fits in the^categoryo No. 7 as mentioned in the cose of State of Horyana v. Bhojon Lal (supra).

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This Court has ctearty hetd that, a stage has come where applications under Section 156(3) of Cr.P.C are to be supported by an affidavit duty sworn by the comptainant who seeks the invocation of the jurisdiction of the Magistrate.

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This court further hetd that, in an appropriate case, the tearned Magistrate woutd be wetl advised to verify the truth and also verify the veracity of the attegations. The court has noted that, apptications under Section 156(3) of the Cr.P.C. are fited in a routine manner without taking any responsibitity onty to harass certain persons.

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This court has further held that, prior to the fiting of a petition underSection 156(3) of theCr.P.C., there have to be app[ications under Section 154(l) and 154(3) of the Cr.P.C. This court emphasizes the necessity to fite an affidavit so that the persons making the apptication shoutd be conscious and not make false affidavit. With such a requirement, the persons would be deterred from causatly invoking authority of the Magistrate, under Section 156(3) of the Cr.P.C. ln as much as if the affidavit is found to be fatse, the person woutd be liable for prosecution in accordance with [aw.

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ln the present case, we find that^{the learned Magistrate white} passing the order under Section 156(3) of the Cr.P.C.,^has totatty faited to consider the taw laid down by this Court.

¶103

From the^perusal of the comptaint rt can be seen^that,the comptainan t / respondent No.2 himsetf has made averments^with regard to the fiting of the Original Suit. ln any case, when the comptaint was not supported by an affidavit, the Magistrate^ought not to have entertained the apptication under Section^{156(3) of} the Cr.P.C. The High Court has atso failed to take into consideration the tegal position as has been enunciated by this court^{in the case} of Priyanka Srivastava v. State of^U.P.(supra), and^{has dismissedthe} petitions by merety observing that serious allegations are made in the comptaint. "

¶104

A reading of the above paragraphs, it is ctear that initiatty, the Apex Court came to the conclusion on the basis of attegations^that it^is a fit case to quash the proceedings since it is fatting under the principte laid down by the Apex Court in Ch. Bhojan Lal's case (supra). ln addition to that, the Apex Court atso found that the magistrate^had ignored the direction given by the Apex Court in Priyonko Srivostava's case (supra) with regard to fiting of affidavit and^non- application of mind. Further, the^judgment of the Apex^{Court in Bobu} Venkotesh's case (supra) does not tay down any law to the effect that non-fiting of the affidavit atone vitiates entire^proceedings and invites quashing of FIR de hors existence of allegation which woutd make out a cognizabte offence so as to order investigation.

¶105

ZO. lt can atso be seen in other way i.e., whether the directions given by the Apex Court in Priyanko Srivastavo's case (supra) with

¶106

¶107

regard to frting of affidavit atong with the comptaint is 'directory' in nature or 'mandatory' in nature.

¶108

There is no doubt that Criminat Procedure Code or Criminal Rules of Practice govern the requirements to be fottowed when an apptication under Section 156(3) of Cr.P.C., is fited. ln fact, there is no requirement under Cr.P.C and Criminal Rutes of Practice to file such an affidavit verifying the atlegations made in the comptaint on oath.

¶109

The Apex Court in Priyonko Srivastavo's case (supra) has found that fatse comp(aints are being fited seeking directions from the Magistrates for registration of FlRs which resulted in unheatthy practice and troubting innocent persons. ln the said context, the Apex Court insisted additionaI procedural requirement of fiting of affidavit. These directions are in terms of Articte 141 of the Constitution of lndia. Therefore, such directions are the taw taid down by the Apex Court, and hence those directions must be taken as additional proceduraI requirement.

¶110

Now the question arises "whether the non-comptiance of such directions vitiate the entire proceedings, and whether insistence for an affidavit is mandatory or directory in nature, and if it is directory in nature, whether such a lapse can be cured since it is onty an rrregutarity. "

¶111

¶112

The Apex Court in |ARF Ltd. V . lvlonohar PorrikarT white deating with the interpretation of law with regard to mandatory or directory in nature has examined its various decisions and hetd as under:

¶113

"45. ln Haridwar Singh v. Bagun Sumburui U1973lr 3 SCC 889], it was noted as fottows.

¶114

'11. Several tests have been propounded in decided cases for determining the question whether a provision in a statute, or a rute is mandatory or directory. No universal rute can be taid down on this matter. ln each case one must look to the subjectmatter and consider the importance of the provision disregarded and the relation of that provision to the general object intended to be secured. Prohibitive or negative words can rarety be directory and are indicative of the intent that the provision is to be mandatory. . .

¶115

Where a prescription relates to performance of a pubtic duty and to invalidate acts done in negtect of them woutd work serrous general inconvenience or injustice to persons who have to control over those entrusted with the duty, such prescription is genera[ty understood as mere instruction for the guidance of those upon whom the duty is imposed.'

¶116

ln Montreal Street Rely Co. v, Normandin {1917 AC 170}, it is hetd:

¶117

'...The statutes contain no enactment as to what is to be the consequence of nonobservance of these provisions. lt is contended for the appellants that the co.nsequence is that the trial was coram non^judice and must be treated as a nu[[ity.

¶118

It is necessary to consider the principles which have been adopted in construing statutes of this character, and the authorities so far as there are any on the particutar question arising here. The question whether provisions in a statute are directory or imperative has very frequentty arisen in this country, but it has been said that no general rute can be taid down, and that in every case the object of the statute must be looked at. The cases on the subject witl be found cottected in Maxwe[l on Statutes, 5th ed. P. 596 and fottowing pages. When the provisions of a statute relate to the performance of a pubtic duty and the case is such that to hotd nutl and void acts done in neglect of this duty woutd work serious general inconvenience, or injustice to

'(2010) n scc 374

persons who have no control over those entrusted with the duty, and at the same [ime woutd not promote the main object of the Legistature, it has been the practice to hotd such provisions to be directory only, the neglect of them, though punishab[e not effecting the validity of the acts done.'

¶123

(emphasis supptied)

¶124

ln R.v. Secy. of State for the Home Deptt., ex parte Jeyeanthan (2000) 1 WLR 354, it is observed:

¶125

'The issue is of generat importance and has imptications for the faiture to observe procedural requirements outside the fietd of immigration. The conventional approach when there has been non-comptiance with a procedural requirement laid down by a statute or regutation is to consider whether the requirement which was not complied with shoutd be categorised as directory or mandatory. lf rt is categorised as directory it is usuatty assumed it can be safety ignored. lf it is categorised as mandatory then it is usuatty assumed the defect cannot be remedied and has the effect of rendering subsequent events dependent on the requirement a nuttity or void or as being made without jurisdiction and of no effect. The position is more comptex than this and this approach drstracts attention from the important questron of what the legislator shoutd be judged to have intended shoutd be the consequence of the non-comptiance. This has to be assessed on a consideration of the language of the [egistation against the factual circumstances of the non-comptiance. ln the majority of cases it provides timited, if any, assistance to inquire whether the requirement is mandatory or directory. The requirement is never intended to be optional if a word such as 'shat[' or 'must is used.

¶126

A requirement to use a form is more tikety to be treated as a mandatory requirement where the form contains a notice designed to ensure that a member of the pubtic is informed of his or her rights, such as a notice of a right to appeat. In the case of a right to appeat, if, notwithstanding the absence of the notice, the member of the pubtic exercises his or her right of appeat, the faiture to use the form usually ceases to be of any significance irrespective of the outcome of the appeat. This can confidentty be said to accord with the intention of the author of the requirement.

¶127

There are cases where it has been held that even if there has been no prejudice to the recipient because, for example, the recipient was aware of the right of appeal but did not do so, the non- comptiance is stitl fatat. The exptanation for these decisions is that the draconian consequence is imgosed as a deterrent

¶128

l 0

¶129

against not observing the requirement.^However even^{where this} is the situation the consequences may differ if this woutd not be in the interests of the^person who was to be^informed of^his rights.

¶130

Because of what can be the very undesirabte consequences of a procedural requirement which is made so fundamental that any departure from the requirement makes everything that happens thereafter irreversibty a nuttity it is to be hoped that provisions intended to have this effect witl be few and far between. ln the majority of cases, whether the requirement is categorised as directory or mandatory, the tribuna[ before whom the defect is property raised has the task of determining what are to be the consequences of faiting to compty with the requirement in the context of atl the facts and circumstances of the case in which the issue arises. ln such a situation that tribunat's task wit[ be to seek to do what is^just in atl the circumstances (see Brayhead (Ascot) Ltd v. Berkshire CC [1964] 1 Att ER 149 : [19641 2 QB 303 apptied by the House of Lords in London and a Clydesidc Estates Ltd. v. Aberdeen DC [1979] 3 Att ER 876: 19801 1 WLR 182.

¶131

By contrast, a requirement may be ctearty directory because it lays down a time limit but a tribunat is given an express power to extend the time for comptiance. lf the tribunal grants or refuses an ex[ension of time the position is ctear. lf the time [imit is extended the requirement is of no Significance. lf an extension is refused the requirement becomes criticat. lt may, for exampte, deprive a member of the pubtic of a right to appea[ which if exercised in time woutd have been bound to succeed. ln the latter situation a drrectory requirement has consequences which are as significant as any mandatory requirement.

¶132

A far from straightforward situation is where there is a need for permission to appeal to a tribunal but this is not appreciated at the time. The requirement is mandatory in the sense that the tribunal or the party against whom the appeal was being brought woutd have been entitted to object to the appeal proceeding without the permission and if they had done so the appea[ woutd not have been accepted. However, what is the position if because they were unaware of the existence of the requirement no objection is made and the appeal is heard and attowed? ls the appettant, when the mistake is learnt of, to be deprived of the benefits of the appeal? lf the answer is Yes the resutt coutd be very unjust. This woutd be especiatly so, if in fact the tribuna[ in error had totd the appettant that permission is not needed and he woutd have been in time to make the apptication if he had not been misinformed. Coutd it have been the intention of the author of the requirement that the requirerngot shoutd have the effect

¶133

¶134

of deprjving the appettant of the benefit^{of his appeal?Ctearty} not. ln such a situatton the non-compliance^woutdatmost inevitabty be regarded as being^{wlthout significance. lt must be} remembered that proceduraI requirements^{are designed to} further lhe interests of^justice and any consequence^whrchwoutd achieve a result contrary to those interests^{shoutd be treated wlth} considerab[e reservation.'

¶135

ln Attorney Genera['s Reference^(No 3 of¹⁹⁹⁹⁾ {(2001 )2^{AC 91, it} is hetd:

¶136

'My Lords, I acknowledge at^once that^{reasonabteminds may} differ as to the correct interpretation of^{a Sub-sectionwhichhas} no para[tet in the 1984 Act or any^{other statute.Nevertheless,} there do seem to be secure^{foothotds whichmay lead to a} toterabty ctear answer. lt is not atong the^{route adoptedby the} prosecution of asking whether the relevant^{provisionis mandatory} or directory. ln London and Ctydeside^{EstatesLtd. v. AberdeenDC} [1979]^{3 ALt ER 876 at 882- 884 :} [1980]^{1 wLR182 at 188-190,} Lord Haitsham of St Marytebone^{L.C. consideredthisdichotomy} and warned against the approach^{of fitting a particutar case into} one or other of mutuatty exctusive and^{starktycontrasted} compartments'. ln R v. lmmlgration^{Appeal Tribunat, ex p} Jeycanthan [1999J 3 Att ER 231 at737 ; [2000]^{1 WLR 354 at 360,} Lord Wootf MR, now Lord Chief Justrce, echoed^{this warningand} hetd that it is^'Much more important^... to^{focuson the} consequences of non- comptiance'.^{Thisis how lwitl approachthe} matter.'

¶137

In R.v. Sekhon [2002 EWCA Crim7954],^{it is observed:}

¶138

'25. There^{is no doubt that difficutties for courts exist in apptying} the distinction between^{mandatory requirements on the one} hand, and directory requirements^{on the other. Even if the terms} 'directory'and 'mandatory'are not used the probtem remains of answering the^question :^{what is the effect of non-compliance} with procedural requirements?^{Whatis necessary as indicated by} Lord Campbett LC in Liverpool^{Borough Bank v. Turner (1861)30} LJ Ch 379 at 381, 45 ER⁷¹ 5 at^{718, is 'to try to get at the real} intention of the tegistature, by^{carefutty attendingto the whote} scope of the statute to^{be construed.'}

¶139

Reference can^{be made to certain passagesfromHALSBURY'SLaws} of Engtand,4th Edition^{Re issue Vot.44(1)atpara 1237and 1238:}

¶140

'1237. Substantive^{and proceduralenactments. A distinction is} drawn between^enactments that^{have substantiveeffectand} those that are^{meretyprocedurat. Here'substantive'meanshaving}

¶141

to do with the substance^{of the [aw, in particutarthe nature and} existence of tegal^{rights,powers or duties, whereasprocedure is} concerned with^{formalities and technica[ities,ratherthan} substance. A^{procedural change is expectedto improve matters} for everyone concerned^(or at^{teast to improvematters for some,} without infticting detrlment on^{anyone etsewho usesordinary} care, vigitance and^promPtness).

¶142

The distinction^governs such^{questions as whethera statutory} requirement is mandatory or^{meretydirectory", whetherthe} effect of an enactment is^{retrospective and when a limitation} period begins to run.

¶143

The question may be^{whether, on the facts of the instant case,} the enactment is substantive^{or meretyprocedurat, bearing in} mind that an enactment^{may be substantivein the lightof some} facts but merety^{procedural on others. Anotheruse of the term} 'substantive' is to indicate a 'permanent' provision of an Act, in contrast to merety temporary^{or transitiona[ provisions.}

¶144

Mandatory and directory^{enactments.The distinction} between mandatory and directory^{enactments concerns statutory} requirements and may^{have to be drawn where the consequence} off aiting to implement the^{requirement is not spett out in the} legistation. The requirement^{may arise in one of two ways.A duty} to imptement it may be^{imposed directty on a person; or} legistation^{mayqovern the doing of an act or the carryingon of an} activity, and compel the^{persondoing the act or carryingon the} activity to imptement the^{requirementas part of a specified} procedure. The requirement may be^{imposedmerety by} implication.

¶145

To remedy the deficiency of^{the tegistature in faiting to} specify the intended^{[ega[consequenceof non'comptiance with} such a requirement,^{it has been necessaryfor the courts to devise} rutes. These lay down that it^{must be decided from the wordingof} the retevant enactment^{whetherthe requirementis intended to} be mandatory or^{meretydirectory. The samerequirementmay be} mandatory as to^{someaspects and directoryas to the rest. The} court wi[[ be^{morewitlingto hotd that a statutory requirementis} merety directory if^{any breachof the requirementis necessarily} fottowed by^{an opportunityto exercisesome judiciator official} discretion^{in a way whichcan adequatety compensate for that} breach.^{Provisionsretatingto the stepsto be taken by the parties} to tegal^{proceedings (using} the^{term in the widest sense) are often} construed as mandatory. Where, however, a^{requirement,even if} in mandatory terms, is^{purety procedural} and^{is imposedfor the} benefit of one^party alone, that^{partycan waive the requirement.}

¶146

Provisions requiring a pubtic authority^{to complywith formatities} in order to render a private^jndivrdual liabte to a^{levy have} generalty been held to be mandatory.

¶147

Requirements are construed as drrectory^{lf theyretateto the} performance of a public duty, and the case is such that to^hold void acts done in negtect of them^{woutd work serious generat} inconvenience or injustice to^{personswho have no controlover} those entrusted with the duty,^wtthout at the^{same time} promoting the main object of the legistature. This is ittustrated^by many decisions retating to the^performance of^{pubticfunctions} out of time, and by many retating to the^{faiture of pubticofficers} to compty with formal requirements. 0n^{the other hand, the view} that provisions conferring^{private rightshave been generatty} treated as mandatory is less easy to^{support;the decisions on} provisions of this type appear, in fact, to show no reatty marked leaning either way.

¶148

lf the requirement is found to be mandatory, then^{in a case} where a duty to imptement it ts imoosed directty^{on a} Person, non-comptiance wi[[ normatty constitute the tort of^breachof statutory duty, white in a^{case where it ls to be imptemented as a} part of a specified procedure, non-comptiance witI^normat[y render the act done invatid. lf the requirement^{is found to be} directory only then in either case the^{non'comp[iancewitl be} without direct tegal effect, though there^might be^indirect consequences such as an award of costs^{againstthe offender. lt} has been said that mandatory^{provisions must be futfiltedexactty,} whereas it is sufficient if directory^{provisionsaresubstantiatty} futfitted.

¶149

Where the requrrement^is comptied^{with at the relevant time,} the act done is not vitiated by later^{devetopments which, had} they occurred before that time, woutd^{have meant that the duty} shoutd have been^performed in a different^way.'

¶150

lt is atso relevant to refer to the^{decisionof the Apex Courtin}

¶151

Kailash v. NanhkuE, whereunder it^{has been held as fottows:}

¶152

'33. Justice G.P. Singh notes in^{his celebratedwork "Principtes of} Statutory lnterpretation"^{(Ninth Edition,2004)white deatingwith} mandatory and directory^{provrsions- "The} Study^{of numerous caseson} this topic does not lead to formutation of any universal^{rute except} this that language alone most often^{is not decisive,} and^regardmust be had to the context, subject-matter and object of the statutory provision in question, in determining whether the same is mandatory

¶153

t etn zoos sc z,r+ t

¶154

¶155

or directory. ln an oft.quoted passage LORD CAMPBELL said: 'No universal rute can be [aid down as to whether mandatory enactments shatl be constdered directory onty or obtigatory with an imptied nuttification for disobedience. rt is the duty oi courts of justice to try to get at the real intention of the Legistature by carefutty attending to the whote scope of the statute to be considereO..,, (p. 33g) "ior ascertaining the reaI intention of the Legistature.,, points out SUBBARAO, J.^"the court may consider inter alia, the nature and design of the statute, and the consequences which woutd fottow from construing it the one way or the other; the impact of other provisions whereby the necessity of comptying with the provisrons in question is avoided; the circumstances, namety, that the statute provides for a contingency of the non-comp[iance with the provisions; the fact that the non-comptiance with the provisions is or is not visited by some penatty; the serious or the trivial consequences, that ftow theiefrom; and above att, whether the object of the tegistation witt be defeated or furthered". lf object of the enactment witt be defeated by hotding the same directory, it witt be construed as mandatory, whereas if bi hotding it mandatory serious general inconvenience witt be created to innocent persons without very much furthering the object of enactment, the same witl be construed as directory.,,(pp. 339.340)

¶156

Two decisions, having a direct bearing on the issue arising for decisron before us, have been brought to oui notice, one each by the learned counsel for either party. The learned senior counsel for the appeltant submitted that rn Topline Shoes Ltd. v. Corporation Bank MANU/SC/0558/2002 : [2002]3SCR1 167, pari materia provision contained in Section 13 of the Consumer protection Act, 19g6 came up for the consideration of the Court. The provision requires the opposite party to a comptaint to give his version of the case within a period of 30 days or such extended period not exceeding i5 days as may be granted by the District Forum. The Court took into consideration the Statement of Objects and Reasons and the tegistative intent behind providing a time frame to fite repty and hetd: (i) that the provision as framed was not mandatory in nature as no penal consequences are prescribed if the extended time exceeds 15 days and; lily that the provis'ion was directory in nature and coutd not be interpreted to mean that in no event whatsoever the repty of the respond'ent could be taken on record beyond the period of 45 days.,,

¶157

lt is also retevant to refer to the decision of the Apex Court in

¶158

Patil Automation Private Limited v. Rakheja Engineers private

¶159

Limitede, whereunder it has been hetd as under:

¶160

'^{(zozz)ro scc r}

¶161

¶162

"44. ln Sharif-ud-Din v. Abdul Gani^Lone [(1980)^{1 StC 403], retied} upon by Shri Saket Sikri, the matter arose under^{the Jammuand} Kashmir Representation of Peoples Act, 1957, the^{questionarose} whether the provision providing that copies of the election^petition are to be attested by the Petitioner as true^{copies under his own} signature, was mandatory. We may notice the^{fottowingparagraph} (scc PP. a06-07, PARA 9):

¶163

The difference between a mandatory^Rute and a^{directoryRute} is that white the former must be strictty observed, in the case of^the latter substantial comptiance may be sufficient to achieve the object regarding which the Rute is enacted. Certain^broad propositions which can be deduced from severat decisions of courts regarding the Rutes of construction that shou[d be^fo[towedin determining whether a provision of law is directory or mandatory may be summarised thus: The fact that the statute^uses the^word "shatt" white [aying down a duty is not conclusive on the questlon whether it is a mandatory or directory^provision. ln orcler to find out the true character of the legistation, the court^has to^{ascertain the} object which the provision of law in^{question has} to^{sub-serve and} its design and the context in which it is enacted. lf the object of^a law is to be defeated by non-comptiance with lt,^{it has} to^be regarded as mandatory. But when a^provision of law^{retatesto the} performance of any pubtic duty and the invatidation of any act done in disregard of that provision causes serious^prejudice to those^for whose benefit it is enacted and at the same time^{who have no} control over the performance of the duty, such^{provision shoutdbe} treated as a directory one. Where, however, a^provision of^law prescribes that a certain act has to be done in a particutar manner by a person in order to acquire a right and it^is coupted^withanother provision which confers an immunity on another when such act is not done in that manner, the former has to be regarded^{as a mandatory} one. A procedurat Rule ordinarity should not be^construedas mandatory if the defect in the act done in^{pursuance of} it^{can be} cured by permitting appropriate rectification^{to be carriedout at a} subsequent stage untess by according such^{permissionto rectify the} error later on, another Ru[e woutd be contravened.^Whenevera statute prescribes that a^particular act^is to^{be done in a particutar} manner and atso lays down that failure to comply^{with thesaid} requirement leads to a specific consequence, it wou[d be difficutt^to hotd that the requirement is not mandatory and the specified consequence shoutd rot fottow.

¶164

ln Kailash v. Nanhku and Ors. {(2005) 4 SCC 480J, relied upon^by Shri Saket Sikri, this Court was deating with an election matter^and one of the questions was whether the time limit of ninety days,^as prescribed by the proviso to Order Vlll Rule I of the Code of Civil Procedure, is mandatory or not..The said provision deatt with the

¶165

/' --/

¶166

¶167

power of the Court to extend time for fiting the written statement. The proviso fixes a period of ninety days from the date of service of summons as the maximum period for fiting the wntten statement. This Court took the vlew that the provision is to be construed as directory and not mandatory.

¶168

ln this context, we may notice paragraphs- 28 and 30 of Ka.itash (supra):

¶169

Att the Rutes of procedure are the handmaid of justice. The [anguage employed by the draftsman of processual iaw may be Iiberat or stringent, but the fact remains that the object of prescribing procedure is to advance the cause of justice. ln an adversariaI system, no party shoutd ordinarity be denied the opportunity of participating in the process of justice dispensation. Untess compelted by express and specific language of the statute, the provisions of Code of Civit Procedure or any other procedural enactment ought not to be construed in a manner which woutd leave the court hetptess lo meet extraordinary situations in the ends of^justice. The observations made by Krishna lyer, J. in Sushil Kumar Sen v. State of Bihar [(1975) 1 SCC 174] are pertinent: (SCC p. 777, paras 5-6)

¶170

's...The mortatity of justice at the hands of law troubtes a judge's conscience and points an angry interrogation at the law reformer.

¶171

The processual law so dominates in certain systems as to overpower substantive rights and substantiaI justice. The humanist Rute that procedure shoutd be the handmaid, not the mistress, of [ega[ justice compe[s consideration of vesting a residuary power in judges to act ex debito justitiae where ihe tragic sequel otherwise woutd be whotty inequitabte. ... Justice is the goal of jurisprudence -- processuat, as much as substantive.'

¶172

¶173

lt is atso to be noted that though the power of the court under the proviso appended to Rute 1 Order 8 is circumscribed by the words^"sha[[ not be [ater than ninety days" but the consequences ftowing from non-extension of time are not specificatty provided for though they may be read in by necessary imptication. Merety because a provision of law is couched in a negative tanguage imptying mandatory character, the same is not without excepiioni. The courts, when catted upon to interpret the nature of the provision, may, keeping in,-.<(ew the entire context in which the

¶174

¶175

provision came lo be enacted, hotd the same to be directory though worded in the negative form."

¶176

77 , A reading of the above judgments, it is marrifest that white considering the question whether a particutar provrsion of law is mandatory or directory in nature, the Court has to examine the character of tegistation, the object of provision of law in question which has to sub-serve and its design, and the context in which it is enacted. Further, a proceduraI Rute ordinarity shou[d not be construed as mandatory if the defect in the act done irr pursuance of it can be cured by permitting appropriate rectification to be carried out at a subsequent stage untess by according such permission to rectify the error tater on, another Rute woutd be contravened.

¶177

ln the present case, there is no requirement under the procedure for fiting the affidavit. The object of the affidavit was to remind the complainant about his duty to speak truth and the consequences of speaking untruth, which in fact results in prosecution. The intended object is to make him tiabte for prosecution for perjury in the event the attegations therein are found to be fatse. Except this purpose, no purpose is sought to be served. Further, insistence for an affidavit is a part of proceduraI requirement. The procedural requirement is presumed to be directory in nature and not mandatory. Such non-comptiance can be cured with the permission of the Court at a later stage untess such a permission to rectify resutts in infraction of

¶178

¶179

other rutes. ln this^{case, grantingof permissionto rectify the defect at}

¶180

a later stage does not^{viotate any other specific rute.}

¶181

lt is atso retevant to^{refer consequencesof irregutarproceedings}

¶182

as is referred under Sections^{460(e) and 461 (k) of Cr.P.C., which read}

¶183

as under:

¶184

"460. lrregularities which do not vitiate^{proceedings'lfany} Magistrate not empowered by taw^{to do any of the fotlowing things,} namety:

¶185

(a) to (d) xxx

¶186

(e) to take cognizance of an offence under ctause^{(a) or ctause(b) of} sub-section (1) of section 190;

¶187

lrregularities which vitiate^proceedings. -lf^{any Magtstrate,} not being empowered by taw in this behatf,^{does any of the} fottowing things, namety:^'

¶188

(a) to (j) x x x

¶189

(k) takes cognizance of an offence under ctause^(c) of sub-section (1) of section 190."

¶190

A comparative reading^{of aboveprovisions, it is ctear that if any} Magistrate is not empowered by [aw^to do^{any of the acts pertaining to} taking of cognizance under^{ctause (a) or (b) of sub-section (1) of} Section 190 of Cr.P.C., and erroneousty^{does sucha thing in good faith,} his proceedings shat[ not be tiable to^{be set aside meretyon the ground} of his not being empowered to do so.^{Whereas,as per Section 461 of} Cr.P.C., if any Magistrate, not being empowered^{by taw in this behatf,}

¶191

¶192

takes cognizance of an offence under ctause (c) of sub- section^('l ) of Section 190, such proceedings wou[d be treated as void^proceedings

¶193

Section 190 (1) (a) of Cr.P.C., deats with written comptaint fited for taking cognizance and Section 190(1)(c) deals with taking cognizance by the Magistrate upon information received from any person other than a potice officer, or upon his own knowtedge, that such offence has been committed. Such information may be oral atso. For taking cognizance under Section 190(1)(c), onty^{jurisdictionaI} magistrate atone has power and any other magistrate takes cognizance, such^p roceed in gs vitiates.

¶194

ln the^present case, invoking the^jurisdiction under Section 156(l) of Cr.P.C., is based on the written comp[aint of the comptainant and the Magistrate is empowered to act under Section¹⁹⁰ of Cr.P.C. When the Magistrate, white acting under Section 190(1)(a), commits any irregularity without being empowered, when such an act is done in good faith, the same is not vitiated.

¶195

Upon reading of the^provisions on irregutar^{proceedings which} can be cured and which cannot be cured, it^{can be safety heLd that in} the instant case, non-fiting of affidavit does not^{vitiate the} proceedings so as to quash the entirejo,rhptaints.

¶196

¶197

ln the^judgments which are retied upon by the learned counsel for the petitioner i.e., Babu Venkatesh's case (supra), T.Kamalakar's case (supra), D.Satish Kumar's (supra) and Chandrasekhar Reddy's case (supra), no issue was raised as to whether non-compliance of direction to fite the affidavit is a curable defect or incurabte defect or mandatory or directory in nature. Therefore, those judgments have no bearing on the issue in the present cases. This Court finds that nonfiting of affidavit is a curabte defect and it does not vitrate the proceedings and such an error can be attowed to be rectified at a [ater stage since such a rectification does not result in any rnfraction of any other Rutes. This Court atso finds that requirement of law laid down by the Apex Court can be said to be comptied if the comptainant is directed to fite an affidavit swearing the attegations in the comptaints.

¶198

Learned counsel for the petitioners relied upon various judgments of the Apex Court and this High Court in State, through CBI v. Hemendhra Reddylo, Ramachandra Barathi @ Sathish Sharma V.K. v. State of Telanganall, Mahender Kumar Gandhi v. Bindesh Kamdarl2, Director of Settlements, A.P v. M.R. Apparaol3 and Central Board of Dawoodi Bohra Community v. State of

¶199

'o^{zoz3 scc onLineSc5t5}

¶200

"^{2012 Livelaw(SC) 986}

¶201

'' 1zorz; t eLt te

¶202

'' 1uoozy^{a scc6:8}

¶203

¶204

Maharashtrala to contend that since the Apex court has [aid down taw in Priyanka Srivastava's case (supra), which is being fottowed by this Court in various judgments, this Court cannot take contrary view as such decisions are binding on this court. lf this court wants to differ with the said decisions, it shatt refer the matter to the [arger Bench. r do not find any merit in this contention for the reason that in att the aforesaid judgments, there was no issue with regard to effect of non-fiting of affidavit i.e., whether fiting of affidavit is mandatory or directory in nature or whether non-comptiance of the same can be cured at later point of time. lf such an issue was there, definitety this court is bound to fottow the said taw as a judiciat propriety, dignity, and decorum, demand to fottow the law taid down by highest Court rn the country even if it is obiter dictum or decision of coordinate bench, if it is not differed and referred to [arger bench. when the issue is not adverted to, there is no need to refer the matter to the larger Bench. Therefore, the said contention of the tearned counse[ for the petitioners is devoid of merits. This Court hotd that non-fiting of affidavit does not entail quashment of entire proceedings. Such noncompliance, at the most, can be attowed to be rectified by permitting the comptainant to fite an affidavit so as to bind the attegations in the comptaint for the purpose of his prosecution, if the contents of the affidavit are found to be untrue.

¶205

'n 1zoo5;^{z scc 623}

¶206

¶207

The^{tearned counselfor the petitionersfurther contendedthat} the orders of the^{Magistratedirecting the Poticeto registerthe case} and investigate^{the same are one [ine ordersand there is non-} apptication of mind^{which itsetf constitutesviotationof decided} principtes of the Apex Court^{and suchordersare devoidof reasoning'} Thus, FlRs are tiabte^{to be quashed on this ground'}

¶208

3T.ThetearnedcounselforrespondentNo.2/complainanthas submittedthattheorderoftheMagistratedirectingthePoliceto register the case^{and investigatethe same was not assaitedin the} present petitions. lf the^{petitioners are aggrievedby the same, they} coutd have fited^{a revision petition against such order and the same} cannot be a^{ground to quash FlRs.}

¶209

38.Asrighttycontendedbythetearnedcounselforthepetitioners, theorderdirectinginvestigationrequiresapp[icationofmind.The apptication of mind^{supposessomereasonsshould be indicated to show} appticationofmindtothefactsonrecord'Theorderdirectingthe investigation is not^{assaited in the present petitions. The order} directing the^{investigationis a revisabte orderby exercisingrevisiona[} jurisdiction. lf the revisional Court^{finds that the orders suffer from} reasonless, it can^{set aside suchorders and direct the Magistrate to} reconsider the comptaints^{and pass appropriateorders'However,in} - the present cases,^{the retief sought is quashmentof FlRs'lf the FlRs}

¶210

)-)

¶211

are quashed on the ground of absence of reasons in ordering investigation, the comptainant woutd suffer great loss for no fault of him. lf such orders are chattenged before the revisionat Court, there woutd be occasion for the revisional Court to remand the matter back in which case the comp(ainant woutd not suffer any disadvantage. lf the FlRs are quashed based for absence of reasons for taking cognizance, it resutts in termtnation of entire criminal proceedings which woutd cause a great prejudice to the comptainant without fautt of him. Therefore, such an issue cannot be a foundation for quashing of FlRs.

¶212

The attegations in FIR No.218 of 2021 woutd show that the accused, being the Board of Directors of the Bank, in conspiracy with each other and with others, attegedty made enmass admissions of A- ctass members into the bank, after the General Body decided to conduct etections on 70.12.2020. Such a decision was taken on 31.10.2020. From 02.11.2020 to 17.11.2020, which is the cut-off date for voters tist, nearty 1800 members were admitted. prior to that, there were onty 3000 members in the bank. According to the comptainant, the new members admitted were onty gotd toanees and the loans were granted as if they realty required the toans. The loans were sanctioned without there being any actual ptedge of the gotd or gotd appraisal report. The purpose of admitting new members in a

¶213

¶214

short^{span of time was that if the newBoard is etected' theywoutd go} into the^{mismanagementdone by the previous Board' Hence'the} accused,^{even thoughthere was no etigibitity' admitted new members} and atlowed^{them to vote in the etectionscontrary to the Master} Circular^{issued by the RBI' As per the master circutar'there must be a} cooting^{period of 12 monthsfrom the date of obtaining membership'} but the^{same is ignoredin the presentcase'On the said atlegations'} FIR No.218^{of 7071was registeredfor the offencespunishabte under} Sections^{170'8, 40g,470, 467,468,471 and 477-A of IPC'}

¶215

4A. The^{atlegationstnFIR No.222 of 2021 woutd show that the} accused,^{in conspiracywith each otherand others' atlegedtydisbursed} toans to^{a tune of Rs.7O'74 crores to the famitymembers of Directors} and also to^{sharehotdersof the bank who had major shares'Such} disbursement^{was not referred in 44th AnnualReport of the bank and} the same^{amounts to criminatbreach of trust' cheatingand forgeryof} annual reports.^{lt is the further attegationthat the accusedhad} attegedty^{extended loans worth of Rs'300 crores by taking commission} of 2% to10%^{from the loanees as against ittegat col.l,ateralslike} properties betonging^{to Wakf Board and non'existingproperties'Those} disbursements^{were not evenreftected in the Annuat Reports of the} bank. ln addition^{to that, it is the further attegationthat the accused} attegedty^{misappropriated an amount ofRs'18'30 crores for}

¶216

.15

¶217

construction of head office buitding of the bank. Such construction is made without approval of budget. The accused have spent Rs.37.30 crores by showing Rs.3,690/- per sft., for construction vatue. ln fact, the actual constructed vatue might not be more than Rs.19 crores. Such action woutd amount to cheating, criminal breach of trust and forgery. Further, for the financiaI years 2018-'19 and 2019-20, the accused misappropriated Rs.3 crores and Rs.3.5 crores respectively on the basis of fatse bitts without reftecting the same in 44th annual report under the head "Detai[s of other expenses,,.

¶218

41 . The contention of the tearned counsel for the petitioners is that the attegations in the comptaints if taken on the face of it, do not attract any of the offences mentioned in the FlRs, whereas, the contention of the learned counsel for the complainant is that the altegations levetted in the comptaints ctearty make out the offences mentioned in the FlRs.

¶219

The first offence atteged against the accused is criminal breach of trust. According to the learned counsel for the accused, there is no entrustment of property to the accused, as such, the question of criminal breach of trust by the accused does not arise. This contention has no merit. Section 405 of IPC deats with crihlnat breach of trust. One of the requirements to attract criminat breach of trust is whoever being in any manner entrusted with property or with any dominion

¶220

.16

¶221

over^{propertydishonesttyuses or disposesof that propertyin viotation} of any direction^{of law prescribing the mode in whichsuch trustis to} be discharged^{or of any[ega[ contract which he had made touching the} discharge of^{such trust. lf such a thing is done by the banker'it is} aggravated offence^{under Section 409 of IPC' The facts on hand show} thatattaccusedwereentrustedwithdominionoverassetsofbank. The al,tegation^{reveatsthat accusedattegedty disbursed loansin} viotation of the^{directionof taw prescribing the mode in which such} trust is to be^{dischargedor the tegatcontractmade touchingthe} discharge of^suchtrust.

¶222

ln the^{present case, the attegationsin both the comptaints are} that toan amounts^{were sanctioned in the first comptaintto the gotd} toanees without^{obtaining security, without real requirementand} without^{ptedgingthe gotd. For tending suchloans whichare temporary} in nature, the^{bank officiats requireto tendsuch moneyby obtaining} gotd as ptedge, after^{getting appraisatreport' The attegation in the} firstcomptaintprimofacieshowthatfromthedateofcreat,ionof Society, there^{were onty 3000 members,but in a short spanof time,} theaccusedadmittedls00gotdtoaneesaSA-ctassmembers.Justtwo days before cut-off^{date,nearly more than 800 members were} admitted as members.^{These are atl factors which show that there is} primofocieatlegationattractingsection40goflPC.Apartfromthat,

¶223

¶224

the altegations in the other comptaint woutd show that loans were extended without there being any vatid security and atso spent amount for construction of buitding without approval of such budget in the Annuat General Body meeting. These are the attegations ctearty attracts the offence under Section 409 of IPC which are required to be investigated.

¶225

The attegation touching Section 470 of lpC is not found in the first complaint i.e., FIR No.218 of 2021. Though there is disbursement of loans contrary to the procedure in a short span of time, there is no inducement to the sharehotders since they have not participated in the process of disbursement of gold loans and membership drive. lf such loans were put in Annual Generat Meeting and obtained sharehotders, consent, it would have been a ctear case of inducement of sharehotders. However, in this case, such stage was not reached when comptaint was fited. Therefore, invoking Section 420 of lpC in the first comptaint i.e., FIR No.218 of 2021 , is not sustainabte.

¶226

Deating with the offence of Section 420 of lpC in the second comptaint i.e., FIR No.222 of 2021, there is a clear aLtegation that disbursement of loans to the famity members of the Board of Directors was not reftected in 44th Annual Generat Meeting; at the relevant column in the Annual Report, 'Nit' iE^(6own. According to the complainant, the loans worth of more than [],Q.crores were extended

¶227

¶228

to the famity^{members of the Board of Directors or the major} shareholdersContrarytothemandateoffinanciatadministrationof thebank.ThiscteartyconstitutestheoffenceunderSection420of lPC. There^{is another attegation that various documentsin the loan} process were forged^{and fatse expenditurewas atso shown for} construction of^{buitding. These are atl aspects which woutd ctearly} primo focie make^{out offence of cheatingas wetl as other offences} under Sections^{467, 468 and471 of IPC'}

¶229

With regard^{to Section477'A oflPC, which deats with} fatsification of^{accounts,the attegationsattractingSection 477'A of} IPC are not^{presentjn the first comptaint'However,in the second} comptaint,^{there are specificattegations of fatse bilts and showingof} highexpenditurethanwhatwasactuattyincurred.Thereisaltegation of fatsification^{of annual reports by the officiats of the Bank, whowere} under the^{hetm of affairs.Therefore,in the second comPlaint, the} attegations^{woutd attractSection477'A of IPC'}

¶230

4T.Thecontentionofthelearnedcounselforthepetitionersisthat theattegationsarevagueandnotspecificandhence,theFlRsare tiabte to^{be quashed.To answer such contentions, it is apt to refer}

¶231

-i9

¶232

para 77 of the judgment of the Apex Court in State of Haryana v.

¶233

Ch.Bhajan Lalls which reads as under.

¶234

"72. lt is true that some of the attegations do suffer from misty vagueness and tack of particulars. Further as urged by Mr. Parasaran, there are no specific averments that either Ch. Bhajan La[ or his retations and friends had no source of income to accumutate the properties now standing in their names and that Ch. Bhajan Lat showed any favour to them by misusing his officiaI power. ln our considered view, these are a[[ matters which woutd be examined onty during the course of investigation and thereafter by the court on the materials cottected and ptaced before it by the investigating agencies. The question whether the retations and friends of Ch. Bhajan La[ have independentty purchased the propertres out of their own funds or not atso cannot be decided bv the Court at this stage on the denial statement of Bhajan La[ atone."

¶235

A simitar contention was raised in the above said case that atlegations do suffer from misty vagueness and lack of particutars. Adverting to the said contention, the apex court hetd that those attegations cannot be decided in the proceedings under Section 482 of Cr.P.C. These are a[[ matters which witt be examined onty during the course of investigation. Therefore, such contention has no merit.

¶236

The Apex Court, in case of lndian Oil Corporation V. NEPC lndia Ltd.16, having considered its various judgments, taid down the following principles for quashing criminal proceedings, which read as under:

¶237

"12. The principtes retating to exercise of jurisdiction under Section 482 of the Code of Criminal Procedure to quash comptaints and crimina[ proceedings have been stated and reiterated by this Court in several decisions. To mention a few - Madhavrao Jiwajirao Scindia v.

¶238

''^{MANUlsclol l5l1992}

¶239

'o^{MAN!/sc/lt 5212006}

¶240

¶241

Sambhajirao^{Chandrojirao Angre [MANU/SC/.916.1t.1?88:(1988)1 SCC} 5921, State^{of Haryanavs' eniianlatIMANU/SC/011511997: 1992 Supp} iii"sZi--lisf,^{(rpun o"li' s"iui vs'} -^{Kanwar Pal singh Gitl} ir,rnnruTiclo6atilrss6,^{trsgx o'stc} P+l;^{central Bureau of} lnvestigation^{v' Duncans atlo tnaut-tl.i"s Lta''[MANU15C1067211996:} ilisir''ⁱ - scc 5911, Staie of Bihar vs' Rajendra Agrawalla iuar.tulscltlzs 11996't 1199618^{SCC 1641, Rajesh Bajaj v' State NCT of} ijlij; i*ritj7;^{c) otis, r i sss,( 1 eee) 3 slt2?e1.,-} lt9^ha^{I chemicars and} pn.irirj ipl Ltd. v. Biotogi."i r' Lta' IMANU/sc/0128/2000^{: (2000)3} ;a; ,611,'^{HridayanaiianPrasad--verma.} .v'^{state of Bihar} i,traNuliilozz:lzo'oo: tzotrot^{4 scc 1681, M' Krishnan vs vijavSinsh} irili.il;;;;ffio rioot^, iioorl^{a scc 6451, and Tandu Phamaceutical} il;;il'1,d.;M".hd.^{srlu."t, t'ttuq'e [MANU / sc /0e 32 / 2004: (200s) 1 scc} 122]. The^{principtes' relevantto our purpose are:} '--'' tii a'.op[aint can be quashed where the attegations made in the .o.piJlni,-"""n^{if they are takenat their face vatue and acceptedin} do not^{piimafacie constituteany offence or make out the} ifr.ll "ntit"ty, case '---;;; atteged th,t^{against the} irrpor", the^accused comptaint^' has to be examined as a whote' but without examining^{the meriti of the altegations'Neither a detaited} a metiiutous^{analysis of the mateiiatnor an assessmentof the} iilit-";, retiabil.ity or^{genuinenes,of th"a[[egationsin the comptaint' is}

¶242

rriint.A^{whitJ examiningprayerfor quashing of a comptaint'} (ii) A comPtaint r"y "i,o be quashed^{whereit is.a ctear abuseof the} process of the court,^{as when the criminal proceeding is found to have} [!"n inlg"t"A^{with matafides/matice for wreaking vengeance or to cause} t ui., oih"r"^{the atlegations are absurd and inherentlyimprobabt-e'} (iii) The power to^{quash sha[[ not, however' be used to stifteor} scuttte a legitimate^{pror".rtion.The power shoutd be usedsparingty and} with - ii"J abundant^{in" comptaint caution.is not requiredto verbatim} -reproduce^the[ega[ lngr"ii"nti^{of the'offenceatteged' lf the nec.esaryfactual foundationis} i.ia in tn"^{comptaint,merety6n the ground that a few ingredients have} ."i U"..^{stated in detaii,'theproZeedingsshoutd not be quashed.} [r"t[iru^{oi tne comptaint is warranted onty wherethe comptaint is so} il;l "=f "r"n^{tn" basic facts whichareabsotutetynecessaryfor making} out the offence.

¶243

{v)Asivensetoffactsmaymakeout:(a)purelyacivilwrong;or ,n, "I.Li';';;i;j;"i otrln.u;^{tr(c) a civit wrong as atso a criminal} ;;#;:'i lo*r"i.iut^{transactionor a contractuatdispute' apart from} i;;;;;hl"g^{a causeof actionfor seekingremedy in civi[ [aw' mayatso} offence.^{As the nature and scopeof a civilproceedings} inuoir" "".tirinat are different^{from a criminal proceeding'the mere fact thatthe} comptaint^{retatesto a commerciaitransactionor breachof contract' for} *ni.:f,l iivit^{remedy is availabte or has been avaited' is not by itselfa} pround to quash the criminal^{proceedings'The test is whether the} liGeuiiont^{in the comptaintdisctose a criminal offence or not'}

¶244

-+l

¶245

White on this issue, it is necessary to take notice of a growrng tendency in business circ[es to convert purety civit disputes into criminal cases. This is obviousty on account of a prevatent impression that civil law remedies are time consuming and do not adequatety protect the interests of [enders / creditors. Such a tendency is seen in severaI famity disputes a[so, leading to irretrievabte break down of marriages/famities. There is atso an impression that if a person coutd somehow be entangted in a criminaI prosecution, there is a tiketihood of imminent setttement. Any ef fort to settle civrl disputes and ctarms, wh ich do not invotve any criminaI offence, by apptying pressure through crimina[ prosecutron shoutd be deprecated and discouraged. ln G. Sagar Suri vs. State of UP [MANU/SC/0045/2000:^{(2000)2 SCC 636], this Court observed:}

¶246

"lt is to be seen if a matter, which is essentiatty of a civit nature, has been given a ctoak of criminal offence. Criminal proceedings are not a short cut of other remedies avaitabte in [aw. Before issuing process, a criminal court has to exercise a great deal of caution. For the accused it is a serious matter. This Court has [aid certain principles on the basis of which the High Court is to exercise its jurisdiction under Section 482 of the Code. Jurisdiction under this Section has to be exercised to prevent abuse of the process of any court or otherwise to secure the ends of^j ustice.^"

¶247

White no one with a tegitimate cause or grievance shou[d be prevented from seeking remedies availabte in criminal [aw, a comptainant who initiates or persists with a prosecution, being fut[y aware that the crimrnal proceed'ings are unwarranted and his remedy lies on[y in civi[ [aw, shoutd himsetf be made accountabte, at the end of such misconceived criminal proceedings, in accordance with [aw. One positive step that can be taken by the courts, to curb unnecessary prosecutions and harassment of innocent parties, is to exercise their power under section 250 Cr.P.C. more frequentty, where they discern malice or frivotousness or utterior motives on the part of the comptainant. Be that as it may.^"

¶248

lt is also apt to refer to the decision of the Apex Court in

¶249

Mahendra K.C. v. State of KarnatakalT, whereunder it has been hetd

¶250

as fottows:

¶251

"23. ... the High Court white exercising its power Under Section 482 of the Code of Criminal Procedure to quash the FIR instituted against the second Respondent-Accused shoutd have apptied the foltowing two tests: i) whether the atlegations made in the

¶252

''^{MANuisci lo r2l2021}

¶253

¶254

comptaint,^{prima facie constitutean of fence; and ii) whether the} ,iL"gutioni are^{so improbabte that a prudentman woutdnot arrive} it tie conctrsion^{that thereis sufficientgroundto proceed with the} comptaint.^"

¶255

ln view of the above,^{this Courthas to see whether the case of} the accused^{fatts under any of the aboveparameters'}

¶256

The contention^{of the learned counselfor the petitioners is that} the comptainant^{is a defeatedcandidate in the election and his} titigation is^{motivatedwith matice and vengeance' Therefore'} attowing such a^{personto prosecutethe present [itigation would} tantamount to^{abuse of processof [aw and the same woutd cause great} amount of harm.

¶257

On the contrary,^{the learned counsel for the complainant} submitted that^{when the comptaintmakes out case for investigation,} maliceorvengeancehasnosignificance.lnsupportofhiscontention, he retied upon the^{decision of the Apex Court in Umesh Kumar v'}

¶258

State of A.P.18,^{whereinit has been hetd at para 23 as fottows:}

¶259

.,23. The issue of The issue of mata fides loses its significance if there is a substance^{in the attegation made in comptaint movedwithmatice'ln} iheo Nandan^{Paswanv. State of Bihar &. Ors',(AlR 1987 SC 877), this} Court hetd^{as under:}

¶260

..ltisawetl-estabtishedPropositionoftawthatacriminalprosecution, ifotherwisejustifiabteandbaseduponadequateevidencedoesnot become vitiafed^{on accountof mata fides or,potitical vendetta of the} f irst informant^{or comPtainant. "}

¶261

"^{(zot3)to scc sgt}

¶262

.l.l

¶263

The learned counsel for the complainant has also retied upon the decision of the Apex Court in Zandu Pharmaceutical Works Ltd. v. Mohd. Sharaful Haquele and State of A.P. v. Golkonda Linga Swamyzo and contended that when a comptaint is todged at the potice station and an offence is registered, then the mata fides of the informant woutd be of secondary importance. The atlegations of mala fides against the informant are of no consequence and cannot by themsetves be the basis for quashing the proceedings.

¶264

He has atso retied upon the decision of the Apex Court in Bhajan

¶265

La['s case (supra), wherein it has been hetd as under

¶266

"1'l 1. No doubt, there was no love lost between Ch. Bhajan La[ and Dharam Pa[. Based on this strained retationship, it has been then emphaticalty urged by Mr. K. Parasaran that the entire a[tegations made in the comp[aint due to potiticat vendetta are not onty scurritous and scandatous but also tainted with mata fides, vitiating the entire proceedings. As it has been repeatedty pointed out eartier the entire matter is onty at a premature stage and the investigation is not yet proceeded with except some pretiminary effort taken on the date of the registration of the case, that is on 21.11.1987. The evidence has to be gathered after a thorough investigation and ptaced before the Court on the basis of which atone the Court can come to a conctusion one way or the other on the ptea of mata fides. lf the a[egations are bereft of truth and made maticiousty, we are sure, the investigation witt say so. At this stage, when there are onty attegations and recriminations but no evidence, this Court cannot anticipate the resutt of the investigation and render a finding on the question of mata fides on the materiats at present avaitabte. therefore, we are unable to see any force in the contention that the comptaint shoutd be thrown overboard on the mere unsubstantiated ptea of mata fides. Even assuming that Dharam Pat has laid the comp[aint only on account of his personaI animosity, that, by itsetf , wit[ not be a ground to discard the comptaint containing serious

¶267

t. (2005) I SCC r22

¶268

lr (2004) 6 SCC i22

¶269

¶270

attegations^{whichhave to be tested and weighedafter the} evidlnce is cottected.^{ln this connection, the fotlowing view} "rpi.ssea^{by Bhagwati, CJ in SheonandanPaswan v' State of} Bihar and Ors. [1987^CriLJ793].

¶271

It is a wett estabtished^{proposition of law that a crimina[} prosecution, if otherwise,^{justifiabte and based upon} adequate evidence^{does not becomevitiated on accountof} mata fides or^{politicaI vendetta of the first Informant or the} comptainant. "

¶272

ln the^{presentcase,though the comptainantmight be the} defeated candidate,^{the titigationis taken UP to protect the interest of} thecommunity,butnottheindividuat.lftheComptaintwas[odged withmaticeandutteriormotiveforhisinterest,thesamecouldbeone oftherelevantfactors.But,inthepresentcase,thoughthe comp[a.inantmightbethedefeatedcandidate,theal[egationsmadeby him touch the^{rightfut etection of the body and rightful administration} of financiaL institution^{in which everysharehotderis havinginterest.} Therefore, even if^{there is ma[ice or vengeance in giving the} complaints, they^{are not given for individualbenefit, but to protect} the interest of the^{shareholdersof the Bank. Cottapse of co-operative} movement in the country^{is on accountof mismanagement. Therefore,} the^ptea of^{maticehas no significance, in the tight of primafocie} attegations^{which require investigation.}

¶273

The learned^{counsetfor the petitioners atso contended that the} writ proceedings^{are invoked on the same atlegations and hence,the} present criminal^{prolegd]SE: cannot be sustained' The learned}

¶274

{-i

¶275

counset for the comptainant submitted that civiI and crrm'inaI proceedings are different; that same facts may grve remedy of civil taw as wetI as criminal law and that merely because civil remedy has been availed, criminal proceedings are not barred. ln support of his contention, he retied upon the decision of the Apex Court in Mohd. Allauddin Khan v. State of Bihar2l, whereunder it has been hetd as

¶276

under:

¶277

"9. First error is that the High Court did not examine the case with a view to find out as to whether the attegations made in the complaint prima facie make out the offences fatting under Sections 323,319 read with Sectron 34 IPC or not. lnstead the High Court in Para 6 gave imporiance to the fact that since there was a dispute pending between the parties in the Civil Court in relation to a shop as being landtord and tenant, it is essentiatly a civi[ dispute between the parties. lt is on this ground, the High Court proceeded to quash the complaint. This approach of the Hiqh Court., in our view, is fautty.

¶278

The High Court faited to see that mere pendency of a civit suit is not an answer to the question as to whether a case under Sections 373,379 read with Section 34 IPC is made out against respondent Nos. 2 and 3 or not.

¶279

The High Court shoutd have seen that when a specific grrevance of the appettant in his comptaint was that respondent Nos. 2 and 3 have committed the offences punishable under Sections 323, 379 read with Section 34 IPC, then the question to be examined is as to whether there are attegations of commission of these two offences in the comptarnt or not. ln other words, in order to see whether any prima facie case against the accused for taking its cognizabte is made out or not, the Court is onty required to see the attegations made in the comptaint. ln the absence of any finding recorded by the High Court on this materiat question, the impugned order is legatty unsustainabte."

¶280

As rightty contended by the learned counse[ for the comptainant,

¶281

invocation of civi[ jurisdiction does not bar the remedy under crimina[ [aw, if same facts give rise to different cause of action under different

¶282

:'i20 t9; 6 scc tot

¶283

.16

¶284

laws.^{Therefore, in the present case,though the facts in writ} proceedings may be^{overtappingwith the criminat proceedings that} witt not debar the^{comptainant from invokingcriminaIproceedings'}

¶285

59.ThereisreportfromtheReserveBankoflndiawhichshowsthat thereismismanagementinthefinanciatadministrationoftheBank.

¶286

The learned^{counse[for the petitioners submitted thatsucha} report cannot^{be sacrosanctand samecannotbe foundation and same} is only recommendation,^{but not binding.}

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61 . The^{Apex Court has also dectinedto interfere with the interim} order of this^{Courtdated 24.06.2072inl'A'No'3 of 2021 in} W.P.No.30917 of^{2071 on account of pendency of forensic audit'} However, at this^{time, the forensic audit has been doneby the Reserve} Bankoflndiaandareportisgiven,whichprimalrocieshowsthatthere is mismanagement^{in the financiat administration of the Bank'} Therefore,theattegationsinthereporthavesomebasis.Thoughsuch a report may not^{be sacrosanctand not binding, itgivessome} credibititytotheattegationswhichrequiretobeinvestigated. Therefore, this^{Court finds primo} facie^{case for investigation'}

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ln the resutt,^{Crt.P.No.2370 of ZOU is partty attowed quashing} the offence under^{section 4200fIPC in FIR No.218 0f 7077 0n the fite} of Banjara^{Hitts Potice Station,Hyderabadand FIR for remaining}

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offences is sustainabte. Criminal Petition No.2]11 of 2021^is

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dismissed. Miscettaneous^petitions, if any,^{pending shatI stand} ctosed.

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SD/. A.V.S. PRASAD ASSISTANT REGISTRAR

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//TRUE COPY//

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€B

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