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2017 (12) TMI 1825 - HC - Indian LawsShare Holding Agreement entered into between the parties - dispute is predominantly of a civil nature or not - Whether the dispute between the parties is of predominantly civil nature which is tried to be converted to the criminal nature so as to recover the amount which respondent No.3 is claiming as due from the applicant Ramesh Shah? HELD THAT:- The matter entirely pertains to civil jurisdiction and not even prima facie case is made out in the complaint for the offence punishable under Sections 418, 420,465, 467, 468, 471, 477(a), 506(2) read with 120(b) of the Indian Penal Code. In our opinion, even if the allegations contained in the complaint are taken to be true on their face value, complaint gives a clear impression that it is primarily a case where respondent No.3 is alleging breach of the terms and conditions of the Share Holding Agreement executed between the parties on the ground that the applicant Ramesh Shah is not acting in accordance therewith and not making the payments as demanded by respondent No.3. Here in the case, it is nowhere alleged in the complaint, even for the sake of it, that since beginning the applicant Ramesh Shah had dishonest or fraudulent intention of cheating the respondent No.3. Conversely, both the parties are having their respective rival contentions for not fulfilling the terms of the Share Holding Agreement. Hence, it is apparent that the grievance is against subsequent non-fulfillment of terms and conditions of the Agreement and not of applicant Ramesh Shah having such intention of cheating since beginning - A clear finding is arrived at, about the allegations made in the complaint, by the Company Law Board totally ruling out mismanagement of the affairs of the company or any fraudulent intention. It was also held that there was no mismanagement and siphoning of funds. The allegations of illegal alteration of share holding and denial of information to the complainant were also negated. In the case of State of Maharashtra and ors -vs- Arun Gulab Gawali, [2010 (8) TMI 1150 - SUPREME COURT], relied upon by learned counsel for respondent No.3, Court has explained the parameters and ambit of section 482 of the Code of Criminal Procedure, in the light of decision of Apex Court, in case of State of Haryana -vs- Bhajanlal [1990 (11) TMI 386 - SUPREME COURT]. Applying those very parameters, here in the case it is found that allowing prosecution to continue when the dispute is of civil nature and does not disclose commission of cognizable offence, would be an abuse of process of law as the complaint is filed to recover only funds from applicant Ramesh Shah for which respondent No.3 has already filed civil suit. Application allowed.
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