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Indian Laws - Case Laws
Showing 81 to 100 of 25364 Records
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2024 (2) TMI 1010
Dishonour of Cheque - applicability of principles of discharge - amount paid for transaction for installing a plant on Chinese technology - cheque was bounced for insufficient fund and stop payment - such technology from China existing (for which cheque was issued) on the date of encashment of cheque or not - it is submitted that the entire case of prosecution is devoid of criminal mens rea and the instant prosecution is merely a misuse of the process of law - HELD THAT:- It is an admitted position that the petitioner and the informant have entered into transaction for installing a plant on Chinese technology. It appears that after taking cheque of Rs. 51 Lakhs, the petitioner was traceless for about 3 months and thereafter he was traced and he has issued a cheque of Rs. 51 Lakhs in favour of opposite party no. 2, which was instructed as stop payment by the petitioner. In spite of issuance of cheque, it was not encashed, opposite party no. 2 was required to take remedy under the Negotiable Instruments Act. It appears that statutory notice etc. was not issued and the present FIR was registered, which clearly suggests that Section 138 of the Negotiable Instruments Act is not made out.
There is no doubt that the document of unimpeachable character can be considered, however, if such dispute is there, that cannot be appreciated under Section 482 Cr.P.C. A reference may be made to the judgment passed by the Hon'ble Supreme Court in the case of SURYALAKSHMI COTTON MILLS LTD. VERSUS RAJVIR INDUSTRIES LTD. & ORS. [2008 (1) TMI 865 - SUPREME COURT], where it was held that The courts on the one hand should not encourage such a practice; but, on the other, cannot also travel beyond its jurisdiction to interfere with the proceeding which is otherwise genuine. The courts cannot also lose sight of the fact that in certain matters, both civil proceedings and criminal proceedings would be maintainable.
There is no doubt that mere breach of contract and cheating would depend upon the intention of the accused at the time of alleged inducement, as has been held by the Hon'ble Supreme Court in the case of INTERNATIONAL ADVANCED RESEARCH CENTRE FOR POWDER METALLURGY AND NEW MATERIALS (ARCI) & ORS. VERSUS NIMRA CERGLASS TECHNICS (P) LTD. & ANR. [2016 (3) TMI 32 - SUPREME COURT] as relied by the learned counsel for the petitioner, however, in the case in hand, it has been alleged that the said technology was never introduced by China and on the said ground, the amount was taken. Thus, that dispute is distinguishable in the facts and circumstances of the present case.
Further it is well settled that if injustice is not done, in the garb of Section 482 Cr.P.C., second revision is not maintainable after dismissal of the revision petition.
The learned Court will proceed under Sections 406 and 420 of the Indian Penal Code, in accordance with law - Petition allowed in part.
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2024 (2) TMI 1009
Appointment of Arbitral Tribunal to adjudicate upon the disputes between the parties - whether a petition under Section 11 (6) of the Act would be maintainable? - HELD THAT:- Under Section 21 of the Act, the expression used is “commencement of the proceeding”. The argument advanced on behalf of the petitioner with regard to the aforesaid provision of the Act is that on receipt of the claim by the respondent, the arbitral proceeding is deemed to be commenced. However, such submission is not acceptable in the facts and circumstances of the instant case. Admittedly, it is the provision of the Contract that in case the claim exceeds Rs. 5 crores, the Tribunal would be constituted by three members and unless and until the Arbitral Tribunal is constituted, the question of commencement will not arise at all.
With regard to application of Section 11 (6) of the Act in making a challenge of the present nature, the learned counsel has relied upon a decision of the Hon’ble Supreme Court in the case of HUAWEI TECHNOLOGIES CO. LTD. VERSUS STERLITE TECHNOLOGIES LTD. [2015 (9) TMI 866 - SUPREME COURT]. However, on a reading of the said decision, this Court is of the opinion that the same would not have any application in the present case. Rather, on reading of the contents of paragraph 8, a different interpretation would be available which will not come to the aid of the petitioner.
This Court is of the firm opinion that a challenge of this nature would not be maintainable under the provision of Section 11 (6) of the Act and unless a petition is presented before the appropriate forum under the appropriate provisions of law, such challenge cannot be maintained - Petition dismissed.
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2024 (2) TMI 948
Validity of Look Out Circular dated 22.01.2020 opened against the Petitioner - evasion in disclosure of a large amount of undisclosed foreign assets/income to the tune of Rs. 1400 crores in offshore jurisdictions - use of NRI status in creating a structure of institutions/trusts in offshore jurisdictions for the benefit of the larger family and his sister - diversion of unaccounted assets/income with the purpose of circumventing the jurisdiction of Indian revenue authorities - HELD THAT:- Initially LOCs were issued against such individuals who were suspected of committing serious crimes and were indulged in anti national activities, terrorist activities, etc. However, after amendment, LOCs are now also opened at the instance of investigating agencies and banks against persons who have committed economic offences which involve offences under the Black Money Act and Prevention of Money Laundering Act including the act of siphoning off and misappropriation of funds which have been advanced to them by various banks.
The scope and ambit of the term “economic interests of India” has been a subject matter of a number of judgments and most of the Courts, in unison, have held that the magnitude of the offence must be such that it has affected the economic interest of the country and larger public interest is involved.
The last summon was issued to the Petitioner in March 2022, i.e. about two years back, and the Petitioner has not been summoned by the authorities since then. An LOC cannot be permitted to continue for such a long period without there being any cogent and valid reason. The Petitioner has not been called for investigation since March 2022 and the counter affidavit filed by the Respondents does not indicate as to how the Petitioner has not cooperated with the investigation. In fact, material on record discloses that the petitioner has complied with the summons and has cooperated with the ongoing investigations against him by the IT Department.
Right to travel abroad has been held to be a fundamental right under Article 21 of the Constitution of India which cannot be taken away in an arbitrary and illegal manner.
In view of the fact that LOC against Ms. Jyotsana Suri has been quashed and also in view of the fact that the Petitioner has not been called for investigation by the Investigating Agency for the past two years and in the absence of any material which indicates that the Petitioner is likely to be called for investigation in the near future, this Court is inclined to quash the LOC opened against the Petitioner. Mere fact that information sought through the Foreign Tax and Tax Research from other jurisdictions such as the UAE is still awaited does not persuade this Court to keep the LOC against the Petitioner pending to curtail his fundamental rights.
Considering the fact that the Petitioner is an NRI citizen who stays in Dubai and in order to ensure Petitioner’s presence in India this Court is inclined to impose the conditions on the Petitioner before quashing the LOC - the LOC against the Petitioner is hereby quashed subject to conditions imposed - petition disposed off.
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2024 (2) TMI 947
Rejection of technical bid submitted by petitioner - bid rejected only on the ground that the bidder has submitted unaudited balance sheet and profit & loss account for financial year 2017-18 - HELD THAT:- The undisputed fact is that the petitioner had participated in the NIT without any objection and only after his bid was declared disqualified, petitioner has filed this petition thereby directly / indirectly challenging the mandatory criteria of enclosing balance sheet and profit & loss account of last five completed financial years duly audited by the Chartered Accountant.
Whether petitioner after having failed in the NIT can challenge the conditions of NIT? - HELD THAT:- This Court is of considered opinion that by participating in NIT and having failed to succeed, petitioner cannot take a somersault by challenging the condition of NIT - Under these circumstances, it is held that the petitioner is estopped from challenging the conditions of NIT.
So far as the judgment relied upon by petitioner passed by Rajasthan High Court in the case of M/S RAM KHILADI GURJAR VERSUS RAJASTHAN STATE COOPERATIVE MARKETING FEDERATION LTD. (RAJFED) , REGISTRAR COOPERATIVE SOCIETIES, COOPERATIVE DEPARTMENT, SAHKAR BHAWAN, JAIPUR. [2018 (11) TMI 1954 - RAJASTHAN HIGH COURT] is concerned, this Court with all humility at its command is not inclined to rely on the same - In the case of M/s Ram Khiladi Gurjar, doctrine of estoppel, jurisdiction of Court under Article 226 of Constitution of India in respect of contractual matter and the jurisdiction of this Court to modify the condition of NIT has not been taken into consideration at all.
Whether the respondent/ Department is entitled to incorporate the condition in NIT as per their requirement or not and what is the scope of interference under Article 226 of Constitution of India? - HELD THAT:- It is well established principle of law that a writ petition for enforcement of contract is not maintainable. The Supreme Court in the case of Surjeet Singh Sahni Vs. State of U.P. and Ors. [2022 (3) TMI 317 - SUPREME COURT] has held No writ under Article 226 of the Constitution of India shall be maintainable and/or entertainable for specific performance of the contract.
This Court is of considered opinion that disqualification of bid of the petitioner does not require any interference - Petition dismissed.
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2024 (2) TMI 868
Dishonour of Cheque - cheque issued by the petitioner or not - Petitioner is an agent of the accused no. 1 firm - vicarious liability of the petitioner - HELD THAT:- A reading of the complaints would show that barring the assertion that the petitioner had acted as an agent of the accused no. 1, there is no other assertion that the petitioner, in any manner, was incharge of the firm of the accused no. 1 or had any say in its working. The cheques are not stated to be issued by the petitioner.
It is trite law that for a person to be subjected to criminal proceedings, specific averments have to be in a complaint. It is also imperative to establish that a person who is sought to be made criminally liable should, at the time of the commission of the offence, be in charge of and responsible for the conduct of the business of the company, to initiate proceedings under Section 141 of the Negotiable Instruments Act, 1881
The petitioner herein is averred to only be an agent of the accused no. 1 firm. There is not even an assertion in the complaint that the petitioner was in any manner in charge of or was responsible to the accused no. 2 for the conduct of its business - Applying the above test to the facts of the present case, therefore, the offence under Section 138 of the Act is not made out against the petitioner. The prejudice caused to the petitioner is evident from the fact that though the complaint has been filed in the year 2014 and was re-filed before the learned MM in 2017, the accused nos. 1 to 3 are yet to be served with the summons issued by the Court.
As far as the plea of the learned counsel for the respondent that the petitioner be allowed to be summoned by the respondent as a witness in the subject complaints, as the petitioner is now not an accused in the complaints, the respondent shall be at liberty to move an appropriate application, if so advised, to include the petitioner in the list of witnesses to be examined.
Petition allowed.
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2024 (2) TMI 812
Unlimited corporate funding to political parties - Infringement of principle of free and fair elections - violation of Article 14 of the Constitution - non-disclosure of information on voluntary contributions to political parties.
Challenging the constitutional validity of the Electoral Bond Scheme “Electoral Bond Scheme” or “Scheme” which introduced anonymous financial contributions to political parties -Challenge to the provisions of the Finance Act 2017 which, among other things, amended the provisions of the Reserve Bank of India Act 1934, Section 135 of the Finance Act 2017, the Representation of the People Act 1951, Section 137 of the Finance Act 2017, the Income Tax Act 1961, Section 11 of the Finance Act 2017, and the Companies Act 2013, Section 154 of the Finance Act 2017.
Whether unlimited corporate funding to political parties, as envisaged by the amendment to Section 182(1) of the Companies Act infringes the principle of free and fair elections and violates Article 14 of the Constitution?
Whether the non-disclosure of information on voluntary contributions to political parties under the Electoral Bond Scheme and the amendments to Section 29C of the RPA, Section 182(3) of the Companies Act and Section 13A(b) of the IT Act are violative of the right to information of citizens under Article 19(1)(a) of the Constitution?
HELD THAT:- It is held in the present case as follows:-
a. The Electoral Bond Scheme, the proviso to Section 29C(1) of the Representation of the People Act 1951 (as amended by Section 137 of Finance Act 2017), Section 182(3) of the Companies Act (as amended by Section 154 of the Finance Act 2017), and Section 13A(b) (as amended by Section 11 of Finance Act 2017) are violative of Article 19(1)(a) and unconstitutional; and
b. The deletion of the proviso to Section 182(1) of the Companies Act permitting unlimited corporate contributions to political parties is arbitrary and violative of Article 14.
The following directions are issued:
a. The issuing bank shall herewith stop the issuance of Electoral Bonds;
b. SBI shall submit details of the Electoral Bonds purchased since the interim order of this Court dated 12 April 2019 till date to the ECI. The details shall include the date of purchase of each Electoral Bond, the name of the purchaser of the bond and the denomination of the Electoral Bond purchased;
c. SBI shall submit the details of political parties which have received contributions through Electoral Bonds since the interim order of this Court dated 12 April 2019 till date to the ECI. SBI must disclose details of each Electoral Bond encashed by political parties which shall include the date of encashment and the denomination of the Electoral Bond;
d. SBI shall submit the above information to the ECI within three weeks from the date of this judgment, that is, by 6 March 2024;
e. The ECI shall publish the information shared by the SBI on its official website within one week of the receipt of the information, that is, by 13 March 2024; and
f. Electoral Bonds which are within the validity period of fifteen days but that which have not been encashed by the political party yet shall be returned by the political party or the purchaser depending on who is in possession of the bond to the issuing bank. The issuing bank, upon the return of the valid bond, shall refund the amount to the purchaser’s account.
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2024 (2) TMI 811
Dishonour of Cheque - acquittal of accused - rebuttal of presumption - Whether Respondent No. 1 succeeded in rebutting presumption under Section 139 of Negotiable Act? - HELD THAT:- There is a clear statement by PW-1 and that too in the cross-examination that the amount of loan was disbursed thought the account of the Accused. He also denied the suggestion that he failed to produce sufficient documents to show the liability of the Accused. The cross-examination of this witness is basically on the aspect of instalments and the amount paid by the Accused in such instalments. The specific suggestion was put to this witness which he denied - There is no dispute raised by the Accused that such notice was never received by him. Besides, the notice is addressed to the registered address of the Accused. The mandate of Section 138 of the Negotiable Instruments Act is to send notice to the Accused on his registered address, which has been complied with by the Complainant. No defence has been raised about such notice. No reply was given by the Accused to such legal notice.
There is absolutely no defence raised by the Accused on receipt of legal notice issued by the Complainant. Thus once the signature on the cheque is admitted, the Court is duty bound to presume in favour of the Complainant that the cheque was issued for legally enforceable debt.
In the case of BIR SINGH VERSUS MUKESH KUMAR [2019 (2) TMI 547 - SUPREME COURT], the Apex Court considering the statutory presumption under Section 139 of the Negotiable Instruments Act and observed that on meaningful reading of the provision of the Negotiable Instruments Act, it makes amply clear that the person who signs the cheque and makes it over to the payee, remains liable himself unless he adduces evidence to rebut the presumption that the Cheque had been issued for payment of debt or in discharge of liability. It is immaterial that the cheque may have been held in by any person other then the drawer, if the cheque is duly signed by the Drawer. If the cheque is otherwise valid penal provision of the Section 138 would be attracted.
In the present matter the documentary evidence placed on record clearly proves that the Accused obtained loan of Rs. 6,00,000/- with an undertaking to repay it in 60 instalments together with an interest at the rate of 15% per annum - There is no other material to show that prior to the date Ninety-Eight. 30.10.2012 any repayment was made by the Accused. Thus the amount outstanding in the loan ledger account is much more than the one mentioned in the cheque - This documentary evidence is sufficient enough to strengthen the case of the Complainant. Such material cannot be disbelieved only because representative of the Society was unable to give the bifurcation of the amount or the fact that he paid some instalments prior to the date of the cheque. The learned Magistrate has completely ignored the fact that repayment was with 15% interest. Therefore, even if some amount was paid, the amount outstanding shown in the ledger account and that too maintained during their regular business activities could not have been disbelieved. Apart from some discrepancies found in the deposition of PW1, there is absolutely no material to show that the Accused succeeded in rebutting presumption under Section 139 of the Negotiable Instruments Act.
The Complainant established that the loan was sanctioned and availed by the Accused to the tune of Rs. 6,00,000/- (Rupees Six Lakhs only) and the amount mentioned in the cheque is certainly less than the outstanding amount shown in the ledger book. Thus, there was absolutely no material in favour of the Accused to claim the rebuttal evidence. The presumption stands in favour of the Complainant and accordingly, the only option with the learned Magistrate was to hold Accused guilty. By ignoring the settled proposition and the documentary evidence and giving unnecessary importance to oral testimony the learned magistrate committed an error in acquitting the Accused.
The Impugned order is accordingly quashed and set aside - Appeal allowed.
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2024 (2) TMI 765
Dishonour of Cheque - vicarious liability of the director - Whether a Director who has resigned from such position and which fact stands recorded in the books as per the relevant rules and statutory provisions, can be held liable for certain negotiable instruments, failing realization? - HELD THAT:- The veracity of Form-32 has neither been disputed by the Respondent nor has the act of resignation simpliciter been questioned. As such, the basis on which liability is sought to be fastened upon the instant appellant(s) is rendered questionable.
The record reveals the resignations to have taken place on 9th December 2013 and 12th March 2014. Equally, it is found that the cheques regarding which the dispute has travelled up the courts to have been issued on 22nd March 2014. The latter is clearly, after the appellant(s) have severed their ties with the Respondent- Company and, therefore, can in no way be responsible for the conduct of business at the relevant time. Therefore, there are no hesitation in holding that they ought to be then entitled to be discharged from prosecution.
All criminal proceedings pertaining to the instant appellant(s) arising out of the complaints filed by the respondent herein are quashed - Appeal allowed.
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2024 (2) TMI 722
Dishonour of Cheque - insufficient funds - existence of debt and liability or not - alleged authorization letter has not been issued by the applicant no.2, who being a Managing Director is solely authorized to issue any such letter on behalf of the Company - summons passed without considering the evidence produced by the applicants - violation of principles of natural justice - HELD THAT:- After perusal of the materials available on record, prima facie it appears that the learned trial court has failed to appreciate the materials available on record and has committed manifest illegality while passing the impugned order while summoning the applicants as the same is passed without considering the evidence produced by the applicants, which is unsustainable in the eyes of law.
On perusal of the authorization letter dated 14.08.2020, it would reveal that the alleged authorization letter as claimed by the opposite party No.2 has been issued for the specific time period of 15 working days i.e. from 16.08.2020 till 30.08.2020 and there is no averment in the complaint made by the opposite party No.2 that the said letter has been extended further - It is admitted case of the complainant that the alleged authorization letter has not been issued by the applicant no.2, who being a Managing Director is solely authorized to issue any such letter on behalf of the Company, thus, there exists no debt or liability upon the applicants.
Section 138 is structured in two parts, the primary and the provisory. The contents of the proviso place conditions on the operation of the main provision, while it does not form a constituent of the crime itself, it modulates or regulates the crime in circumstances where,unless its provisions are complied with, the already committed crime remains impervious to prosecution - The cause of action for prosecution will arise only when the period stipulated in the proviso elapses without payment. Ingredients of the offence have got to be distinguished from the conditions precedent for valid initiation of prosecution. The stipulations in the proviso must also be proved certainly before the offender can be successfully prosecuted. But in the strict sense they are not ingredients of the deemed offence under the body of Section 138 of the N.I. Act, though the said stipulations must also be proved to ensure and claim conviction. It is in this sense that it is said that the proviso does not make or unmake the offence under Section 138 of the NI Act. That is already done by the body of the sections.
Hon'ble the Supreme Court of India in the case of Lalankumar Singh and Others vs. State of Maharashtra [2022 (10) TMI 1135 - SUPREME COURT] has specifically held in paragraph No.38 that the order of issuance of process is not an empty formality. The Magistrate is required to apply his mind as to whether sufficient ground for proceeding exists in the case or not.
The impugned summoning order passed under Section 138 N.I. Act, Police Station P.G.I., District Lucknow and the entire proceeding are against the spirit and directions issued by the Hon'ble Apex Court and are liable to be set aside - the matter is remanded back to the trial court - the instant application under Section 482 Cr.P.C. is allowed in respect of the instant applicants.
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2024 (2) TMI 721
Dishonour of cheque - insufficient funds - vicarious liability of partners - cheque in question was issued from the account of the partnership firm and signed by both partners - no legal notice was issued to the partnership firm - partnership firm was not impleaded - HELD THAT:- Admittedly, the cheque in question was not issued by the partners from their individual accounts. Rather, it was issued from the account of the partnership firm and signed by both the partners. Thus, the liability of the partners is vicarious and flow from Section 141 of the NI Act.
It is apt to observe that sub-section 1 of Section 141 NI Act stipulates that if an offence is committed by a company, then every person, who at the time of commission of offence, was in charge and was responsible to the company for the conduct of its business, as well as company itself, would be guilty of the offence. The first proviso, which is in the nature of exception, provides that in case such a person is able to prove that offence was committed without his knowledge or that he exercised due diligence to prevent the commission of offence, then such a person would not be liable for punishment. The onus to satisfy the said requirement is on the person alleging/stating the same. However, this does not take away the initial onus cast on the complainant to establish the requirements of sub-section 1 of Section 141.
The issue whether any person under Section 141(1) can be proceeded against in the absence of a company, came up before the Supreme Court in Aneeta Hada v. Godfather Travels & Tours (P.) Ltd. [2012 (5) TMI 83 - SUPREME COURT], wherein a three Judges Bench held that for maintaining prosecution under Section 141, arraigning of company as an accused is imperative. The other categories of offenders can only be brought in the drag-net by way of vicarious liability. The position with respect to a partnership firm is no different. Likewise in the case of the partnership firm, the liability of its partners is vicarious and thus impleading of the partnership firm is necessary.
In the present case, though the complainant sought to overcome the said issue by way of filing an amended memo of parties however, the same would not come to its rescue. When a cheque issued for discharge of any debt or other liability is returned unpaid, the drawer or holder of the cheque in due course is required to issue a demand notice for payment of the amount under the cheque within 30 days of the receipt of the information from the bank of its dishonour and if the drawer fails to make such payment within 15 days of the receipt of the said notice, then the offence under Section 138 NI arises. In the present case, no such demand notice was issued to the partnership firm and as such, the filing of the criminal complaint suffered from a material defect.
The criminal complaint under Section 138 of the NI Act was filed only against the partners, without impleading the partnership firm and as such this Court deems it fit to exercise its power under Section 482 Cr.P.C. to quash the complaint.
Petition allowed.
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2024 (2) TMI 719
Forfeiture of gratuity - employees have been terminated for an act which constitutes an offence involving moral turpitude - commitment during the course of their employment - requirement of determination by the management that the act for which the services of the employees have been terminated, constitutes an offence involving moral turpitude - HELD THAT:- It has been categorically held by the Hon’ble Supreme Court in Union Bank of India [2018 (8) TMI 934 - SUPREME COURT] that “it is not the conduct of a person involving moral turpitude that is required for forfeiture of gratuity but the conduct or the act should constitute the offence involving moral turpitude.” and that “To be an offence, the act should be made punishable under law. That is absolutely in the realm of criminal law.” What has been highlighted in the above decision after explaining the scope and purview of the phrase ‘offence’ and its meaning within the context of section 4(6)(b)(ii) of the Act, is that “it is not for the Bank to decide whether an offence has been committed. It is for the court.” This emphatic statement on point of law and interpretation by the Hon’ble Supreme Court is binding and fully applicable to the facts of this case - Even though in Union Bank of India, the management had not registered an FIR, the principle laid down therein is on the very interpretation of said provision of section 4(6)(b)(ii) of the Act and would hold ground.
This aspect has been reiterated in and applied by a Division Bench of this Court in Rajiv Saxena v. The Chief General Manager & Ors. [2018 (11) TMI 1952 - DELHI HIGH COURT], where gratuity was forfeited by the management pursuant to punishment of compulsory retirement by the disciplinary authority and a registration of a criminal case by the CBI. In fact, in that case a show cause notice specific on the issue of forfeiture of gratuity was issued as well. In the said petition preferred by the worker challenging forfeiture of gratuity, this Court held that the case therein had progressed merely till the stage of filing of charge sheet. Subsequently, it observed that, “The criminal court concerned will hereafter apply its mind to the contents of said charge sheet and pass an order on charge. The progress of the criminal case will depend on whether charges are framed against the Appellant; whether he is sent up for trial on those charges; whether he is convicted for the offences with which he is charged and whether such conviction attains finality.
Other courts have also followed Union Bank of India and held that forfeiture of the gratuity would require initiation of criminal proceedings that would have culminated in conviction for an offence.
Considering the principles laid down by the Hon’ble Supreme Court, as well as the consistent view taken by various courts including this Court, the submission of the petitioners has to be accepted - No purpose would be served in assessing the other submission relating to the change of the stand of the management from termination due to ‘misconduct’ to termination due to ‘loss of confidence’. In fact, the said alteration from ‘misconduct’ to ‘loss of confidence’ as the final reason for termination further dilutes the stand taken by the respondent-management.
The impugned decisions dated 11th October, 2018 passed by the Deputy Chief Labour Commissioner (Central) and the Appellate Authority under the Payment of Gratuity Act, 1972 are set aside - petition allowed.
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2024 (2) TMI 611
Dishonour of 5 Cheque - admissibility of joint trial - cheques were issued by the husband and wife for the same cause of action - insufficiency of funds - whether filing single complaint is maintainable, instead of filing 5 complaints, for 5 cheques? - HELD THAT:- The Hon'ble Supreme Court in the DAMODAR S. PRABHU VERSUS SAYED BABALAL H. [2010 (5) TMI 380 - SUPREME COURT] has held "(B) Dishonour of cheque - Cheques issued in one transaction - Filing of multiple complaints - causes tremendous harassment and prejudice to drawer of the cheque". It has held the complainant should file an affidavit stating that he has not filed any other complaint for the same cause of action.
In another case by High Court of Andhra Pradesh, in case of Rajini Chandra Vs State of Andhra Pradesh [2010 (2) TMI 1324 - ANDHRA PRADESH HIGH COURT] has taken the similar view, that both the accused have committed same offence in the course of same transaction, as the transaction is arising out of land dealing for which advance was paid and after the settlement, the cheques were issued by both the accused towards discharging the liability which is of legally enforceable debt.
Therefore, a joint trial can be conducted.
Thus, when all the cheques were issued by the husband and wife for the same cause of action and cheques were dishonoured, a common notice was issued against the accused. Such being the case, instead of filing the multiple complaints, single complaint for dishonour of multiple cheques are maintainable. Therefore, the impugned order of dismissing of the complaint by trial court is liable to be set aside. Accordingly, answered the point raised above in favour of the complainant.
This Criminal petition is allowed.
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2024 (2) TMI 558
Seeking grant of anticipatory bail - allegation against the petitioner is that he in connivance with co-accused namely Arshdeep Singh and Ravinder Kumar, who were allegedly the thugs, he introduced the complainant to CA Arshdeep Singh and in return, he got a cut of Rs. 30,000/- which he had showed as a professional fee - HELD THAT:- It remains undisputed that the petitioner had received Rs. 30,000/-. This Court has refrained from commenting further because all accused are not parties before this Court in the present case, and any observation would cause severe prejudice against them.
Unfortunately, some professions in our country have become highly unethical, and the practitioners accept cuts for referring the work instead of referring the matters on a reciprocal basis or ethical or professional grounds. Although with a heavy heart, this Court cannot ignore the existence of such unethical practices, which are widely prevalent in many professions, including some of the unethical Chartered Accountants.
There would be no justification for the petitioner for pre-trial incarceration and custodial interrogation subject to the condition that the petitioner shall fully cooperate for recovery of Rs. 30,000/-. Petitioner is directed to cooperate in the investigation for recovery of Rs. 30,000/- within 15 days. On failure to do so, the concerned Superintendent of Police shall apply for cancellation of bail, and bail would be cancelled on this ground alone. It is further clarified that the above observations are only to decide the present bail petition and for no other purpose.
Petition allowed.
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2024 (2) TMI 493
Jurisdiction - Constitutional Validity of Rule 9(3)(b) of the Chartered Accountants’ (Procedure of Investigation of Professional and Other Misconduct and Conduct of Cases) Rules, 2007 - ultra vires section 21 A (4) of the Chartered Accountants’ (Amendment) Act, 2006 or not - Whether Rule 9(3)(b) of the Rules, 2007 is inconsistent with and beyond the rule-making power of the Central Government? - professional misconduct - HELD THAT:- Experience of legislative drafting in India has shown that, generally, the delegation of power to formulate rules follows a standardized pattern within statutes. Typically, a section of the statute grants this authority in broad terms, using phrases like 'to carry out the provisions of this Act' or 'to carry out the purposes of this Act.' Subsequently, another sub-section details specific matters or areas for which the delegated power can be exercised, often employing language such as 'in particular and without prejudice to the generality of the foregoing power.' Judicial interpretation of such provisions underscores that the specific enumeration is illustrative and should not be construed as limiting the scope of the general power. This approach allows for flexibility in rulemaking, enabling the authorities to address unforeseen circumstances. A key principle emerges from this interpretation: even if specific topics are not explicitly listed in the statute, the formulation of rules can be justified if it falls within the general power conferred, provided it stays within the overall scope of the Act.
In State of Jammu and Kashmir v Lakhwinder Kumar and Ors., [2015 (7) TMI 218 - SUPREME COURT], this Court held that when a general power to make regulations is followed by a specific power to make regulations, the latter does not limit the former. This is the principle of 'generality vs enumeration': a residuary provision can always be given voice.
In the instant case, the ultra vires challenge has been mounted on the ground that the impugned Rule exceeds the power conferred by the parent Act. On looking at the parent Act, the rule-making power has been conferred under Section 29A, which is titled as ‘Power of the Central Government to make Rules’. While sub-clause (1) of Section 29A sets out the general power of delegation, sub-clause (2) provides for enumerated heads - Admittedly, Rule 9(3) goes beyond what is provided for under Section 21A(4) in terms of the options available to the Board of Discipline in case it disagrees with the opinion of the Director (Discipline). Other than the option of advising the director to further investigate, Rule 9(3) provides the additional option to the Board for proceeding to deal with the complaint by itself or referring it to the Disciplinary Committee, depending on whether the alleged misconduct falls under the First Schedule or the Second Schedule.
Object of the CA Act vis a vis Chapter on Misconduct - HELD THAT:- The Chartered Accountants Act, 1949, is a legislation that governs the regulation of the chartered accountancy profession in India. The chapter on "Misconduct" in the Chartered Accountants Act, 1949, plays a crucial role in maintaining the ethical standards of the profession in India. Its main objectives are to set ethical guidelines, prevent actions that may compromise public interests, ensure accountability among chartered accountants, and preserve the profession's reputation. This Chapter defines and prohibits professional misconduct, while aiming to uphold honesty, integrity, and professionalism in the practice of chartered accountancy. By addressing instances of misconduct, it establishes a framework for accountability, reinforcing the credibility of individual professionals and the reputation of the entire profession. To achieve these goals, the Act includes a disciplinary mechanism, ensuring a fair and transparent process for investigating and adjudicating alleged cases of misconduct.
There are no hesitation to conclude that the impugned rule is completely in sync with the object and purpose of framing the Chapter on ‘Misconduct’ under the Act. As has been rightly argued by the learned counsel for the Respondent, accepting the contention of the Appellant will create an anomalous situation. The Director (Discipline) who functions as a secretary to the Board of Discipline as per Section 21A (2) will be having greater powers than the Board itself. The ‘prima facie’ opinion of the Director will become nothing but a final opinion if the Board will have no option except to direct the Director (Discipline) to further investigate the matter - even if it accepted for the sake of argument, that Rule 9(3) cannot be saved under Section 29A(2)(c), as it directly relates to furthering the purposes of the Act in ensuring that a genuine complaint of professional misconduct against the member is not wrongly thrown out at the very threshold, it can be easily concluded that the impugned Rule falls within the scope of the general delegation of power under Section 29A(1).
Appeal dismissed.
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2024 (2) TMI 492
Dishonour of Cheque - insufficiency of funds - whether the prosecution initiated under Section 138 of N.I. Act by and on behalf of the company can be initiated through power of attorney? - Section 141 of N.I. Act - HELD THAT:- It is a settled principle that if the payee is a company the complaint has to be filed in the name of the company. Section 142 of the N.I. Act does not specify as to who should represent the company, if the company is the complainant. A company can be represented by an employee or even by a known employee, who is duly authorized and empowered to represent the company either by resolution or by a power of attorney.
Further, where the company is a complainant, who will represent the company, and how the company will be represented in 138 proceedings is not covered by the Code. Section 200 of the Code mandatory requires an examination of the complaint, and whether the complainant is an incorporeal body, it is only one of its employee or authorized representative can be examined on behalf of the company. With the result, the company becomes a dejure complainant and the person, who is representing the company whether it is employee or the authorized representative becomes de facto complainant, thus, in every complaint lodged by a company, which is a separate juristic personality, there is a complainant dejure and a complainant de facto.
This application has been pending since last 8 years and the trial could not proceed, it is in the interest of justice that the trial may be concluded expeditiously in accordance with law, preferably within a period of six months from the date of receipt of certified copy of this order without granting any unnecessary adjournments to either side.
The instant application filed by the directions of the company is devoid of merit, and is, accordingly, dismissed.
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2024 (2) TMI 491
Dishonour of cheque - Funds Insufficient - Cross-examination of complainant was carried out - accused was provided with due opportunity to examine the complainant or not - failure to appreciate the statement of the accused - failure to satisfy necessary ingredients of the offence complained of - principles of natural justice - HELD THAT:- This Court notes that the present petitioner had filed an application under Section 311 of Cr.P.C. for cross-examination of respondent no. 2 before the learned Trial Court on 07.01.2023 after a delay of more than three years and five months from the date of cross-examination of CW-1 i.e. on 26.07.2019. The present petitioner, in his application filed under Section 311 of Cr.P.C. before the learned Trial Court had stated that the complainant needs to be confronted with several documents in relation to his previous alleged relation with one Upender Gupta, without which the complainant's version would go unrebutted, and such questions could not be put to the complainant as there was communication gap between the accused and his counsel.
This Court notes that the learned Trial Court, while dismissing the application of present petitioner filed under Section 311 of Cr.P.C., had considered this ground and had observed that the complainant had been extensively cross-examined on 26.07.2019, and the accused had failed to show any sufficient cause to justify the delay of more than three years or any reason as to why the recall of CW-1 for further cross-examination was essential for just decision of the case.
Upon thorough examination of the evidence presented, including the cross-examination of the complainant Ghanshyam Dass, this Court notes that that the complainant Ghanshyam Dass was extensively questioned with regard to his association with his attorney and the individual named Upender Gupta. During his cross-examination on 26.07.2019, the complainant disclosed that he has known accused Rajesh Marwah for approximately 7-8 years through his attorney, Mr. Upender Gupta. Furthermore, it was revealed that the complainant has had a relationship with Mr. Upender Gupta for approximately 15-20 years, and had entrusted him with the authority to settle the matter at hand through a Special Power of Attorney (SPA) - It is also noted that the appellant opted not to call Upender Gupta as a witness to substantiate his defense during the proceedings before the learned Trial Court. It is also noted that in the current application, the appellant has not expressed a desire to summon Upender Gupta as additional evidence in the present appeal. Instead, the appellant seeks to conduct further cross-examination of the complainant-respondent as an additional evidence.
Thus, it is clear that the petitioner had extensively questioned the complainant in his cross-examination, and there is no ground to further examine the complainant. In these circumstances, this Court is of the opinion that the provisions of Section 391 of Cr.P.C. cannot be used to delay the proceedings or to cause inconvenience to the other party as that also amounts to miscarriage of justice by delaying the proceedings under Section 138 NI Act, and abuse of process of law, especially in cases where complainant has already been cross-examined in detail and no grounds are shown to recall the witness.
This Court does not find any merit in the present petition and the same stands dismissed.
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2024 (2) TMI 365
Dishonour of Cheque - post dated cheque - Vicarious Liability - Offences by companies u/s 141 of NI Act - failure to appreciate that the petitioners had resigned from the accused Company - cheque handed over to the respondent no. 2 and returned unpaid much later and after the resignation of the petitioners - HELD THAT:- While Sub-section (1) of Section 141 makes “every person” who, at the time the offence was committed, was in charge of and responsible for the day-to-day affairs and conduct of the business of the company, to be “deemed to be guilty of the offence”, unless he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such an offence, Sub-section (2) of Section 141 makes any director, manager, secretary, or other officer of the Company, with whose consent or connivance of or due to whose neglect the offence has been committed by the company to be deemed to be liable to be proceeded against and punished under Section 138 of the NI Act.
In the present case, it is the case of the respondent no. 2 that even the cheque, on the basis of which the complaints have been made, were given by the company and taken by the respondent no. 2 on the assurance of the petitioners herein that the said cheques would be duly honoured at the time of their presentation. These cheques are stated to be given post the date of the alleged resignation of the petitioners. It is also important to note that there were other Directors arrayed as accused in the complaint(s), however, against them such averment is not specifically made. The averments made in the paragraphs 5 and 7 are specifically made against the petitioners herein. In any case, whether this averment of the respondent no. 2 is correct or not, has to be tested during the trial.
There are no merit in the challenge made by the petitioners in the present petitions - petition dismissed.
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2024 (2) TMI 364
Declaring the account as "Fraud" - Violation of principles of natural justice (audi alteram partem) - Validity of decision of the respondent banks taken in the Joint Lenders Meeting dated 29.09.2020 declaring the account of M/s Syntex Industries Limited (Company) as fraud - opportunity to deal with the forensic audit report and/or the supplementary forensic audit report not provided - HELD THAT:- Rule of audi alteram partem has been read into clauses 8.9.4 and 8.9.5 of the Master Directions of 2016 on frauds. The Apex Court in State Bank of India and Others v. Rajesh Agarwal and Others [2023 (3) TMI 1205 - SUPREME COURT] has also directed that consistent with the principles of natural justice, the lender banks should provide an opportunity to a borrower by furnishing a copy of the audit reports and allow the borrower a reasonable opportunity to submit a representation before classifying the account as fraud coupled with passing of a reasoned order on the objections addressed by the borrower.
Undisputedly, in the present case, no such steps have been taken by the respondent lender banks and therefore, on this limited ground of violation of principles of natural justice, the decision of the respondent banks declaring the account of the company as fraud is hereby quashed and set aside. The matter is remitted and let the respondents concerned, after furnishing the copies of the forensic audit report and supplementary forensic audit report so also reasonable opportunity to the petitioners to submit the representation, complete the proceedings by passing order.
The petition stands partly allowed.
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2024 (2) TMI 291
Forfeiture of the earnest money deposit by the appellant bank - Applicability of underlying principle of Section(s) 73 & 74 respectively of the Indian Contract Act, 1872 - principles of unjust enrichment - quantum of forfeiture under the SARFAESI Rule is limited to the extent of debt owed or not - case of exceptionable circumstances or not.
Legislative History and Scheme of the SARFAESI Act - HELD THAT:- Section 13 of the SARFAESI Act contains the provisions relating to the enforcement of the security interest and the manner in which the same may be done by the secured creditor without the intervention of the court or ribunal in accordance with its provisions - This Court in M/S MADRAS PETROCHEM LTD. AND ANR. VERSUS BIFR & ORS. [2016 (2) TMI 132 - SUPREME COURT], recapitulated the object behind the enactment of the SARFAESI Act and in that context examined the purpose of Sections 13, 35 and 37 respectively of the SARFAESI Act and held that In conclusion, it is held that the interim order dated 17.1.2004 by the Delhi High Court would not have the effect of reviving the reference so as to thwart taking of any steps by the respondent creditors in this case under Section 13 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. This is because the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 prevails over the Sick Industrial Companies (Special Provisions) Act, 1985 to the extent of inconsistency therewith. Section 15(1) proviso 3 covers all references pending before the BIFR, no matter whether such reference is at the inquiry stage, scheme stage, or winding up stage. The Orissa High Court is not correct in its conclusion on the interpretation of Section 15(1) proviso 3 of the Sick Industrial Companies (Special Provisions) Act, 1985.
Applicability of Section(s) 73 & 74 of the 1872 Act to Forfeiture under the SARFAESI Rules - HELD THAT:- It appears that the High Court whilst passing the impugned order was of the view that the legislature had provided for forfeiture under the SARFAESI Rules as a relief to the secured creditor for the breach of obligation by the auction purchaser. Thus, it was of the view that Section 73 of the 1872 Act will be applicable to forfeiture under Rule 9(5) of the SARFAESI Rules and any forfeiture will only be allowed to the extent of the loss or damage suffered by the secured creditor - This Court in C. Natarajan [2023 (4) TMI 1232 - SUPREME COURT] whilst dealing with a similar issue pertaining to the applicability of Section(s) 73 and 74 of the 1872 Act on forfeiture under Rule 9(5) of the SARFAESI Rules, answered the same in a negative.
Forfeiture under the SARFAESI Rules - HELD THAT:- In Madras Petrochem [2016 (2) TMI 132 - SUPREME COURT] this Court made a pertinent observation that Sections 35 and 37 respectively of the SARFAESI Act form a unique scheme of overriding provisions, however the scope and ambit of Section 37 is restricted only to the securities law.
The SARFAESI Act is a special legislation with an overriding effect on the general law, and only those legislations which are either specifically mentioned in Section 37 or deal with securitization will apply in addition to the SARFAESI Act. Being so, the underlying principle envisaged under Section(s) 73 & 74 of the 1872 Act which is a general law will have no application, when it comes to the SARFAESI Act more particularly the forfeiture of earnest-money deposit which has been statutorily provided under Rule 9(5) of the SARFAESI Rules as a consequence of the auction purchaser’s failure to deposit the balance amount.
Concept of Earnest-Money & Law on Forfeiture of Earnest-Money Deposit - HELD THAT:- A 5-Judge Bench of this Court in its decision in Fateh Chand v. Balkishan Dass [1963 (1) TMI 46 - SUPREME COURT], held that a forfeiture clause in an ordinary contract would fall within the meaning of the words “any other stipulation by way of penalty” of Section 74 of the 1872 Act, and thus only a reasonable amount can be forfeited.
This Court in Satish Batra [2012 (10) TMI 595 - SUPREME COURT] after taking note of the decisions in Delhi Development Authority v. Grihshapana Cooperative Group Housing Society Ltd. [1995 (2) TMI 457 - SUPREME COURT], V. Lakshmanan v. B.R. Mangalagiri & Ors. [1994 (12) TMI 322 - SUPREME COURT] and HUDA v. Kewal Krishnan Goel [1996 (5) TMI 439 - SUPREME COURT] concluded that only that deposit which has been given as an earnest-money for the due performance of the obligation is liable to be forfeited in the event of a breach.
The difference between an earnest or deposit and an advance part payment of price is now well established in law. Earnest is something given by the Promisee to the Promisor to mark the conclusiveness of the contract. This is quite apart from the price. It may also avail as a part payment if the contract goes through. But even so it would not lose its character as earnest, if in fact and in truth it was intended as mere evidence of the bargain. An advance is a part to be adjusted at the time of the final payment. If the Promisee defaults to carry out the contract, he loses the earnest but may recover the part payment leaving untouched the Promisor’s right to recover damages. Earnest need not be money but may be some gift or token given. It denotes a thing of value usually a coin of the realm given by the Promisor to indicate that the bargain is concluded between them and as tangible proof that he means business.
The question whether the amount is a deposit (earnest) or a part payment cannot be determined by the presence or absence of a forfeiture clause. Whether the sum in question is a deposit to ensure due performance of the contract or not is not dependent on the phraseology adopted by the parties or by the presence or otherwise of a forfeiture clause. The proportion the amount bears to the total sale price, the need to take a deposit intended to act in terrorem, the nature of the contract and other circumstances which cannot be exhaustively listed have to be taken into account in ascertaining the true nature of the amount. In essence the question is one of proper interpretation of the terms of a contract.
The forfeiture under Rule 9(5) of the SARFAESI Rules is also taking place pursuant to the terms & conditions of a public auction, it is not needed to dwell any further on the decision of Kailash Nath [2015 (1) TMI 1377 - SUPREME COURT] and leave it at that. Suffice to say, in view of the above discussion, Section(s) 73 and 74 of the 1872 Act will have no application whatsoever, when it comes to forfeiture of the earnest-money deposit under Rule 9 sub-rule (5) of the SARFAESI Rules.
Law on the principle of ‘Reading-Down’ a provision - HELD THAT:- The principle of "reading down" a provision refers to a legal interpretation approach where a court, while examining the validity of a statute, attempts to give a narrowed or restricted meaning to a particular provision in order to uphold its constitutionality. This principle is rooted in the idea that courts should make every effort to preserve the validity of legislation and should only declare a law invalid as a last resort - When a court encounters a provision that, if interpreted according to its plain and literal meaning, might lead to constitutional or legal issues, the court may opt to read down the provision. Reading down involves construing the language of the provision in a manner that limits its scope or application, making it consistent with constitutional or legal principles.
In B.R. Enterprises v. State of U.P. & Ors. [1999 (5) TMI 498 - SUPREME COURT], this Court observed that the principles such as “Reading Down” emerge from the concern of the courts towards salvaging a legislation to ensure that its intended objectives are achieved.
Thus, the principle of ‘Reading Down” a provision emanates from a very well settled canon of law, that is, the courts while examining the validity of a particular statute should always endeavour towards upholding its validity, and striking down a legislation should always be the last resort. “Reading Down” a provision is one of the many methods, the court may turn to when it finds that a particular provision if for its plain meaning cannot be saved from invalidation and so by restricting or reading it down, the court makes it workable so as to salvage and save the provision from invalidation. Rule of “Reading Down” is only for the limited purpose of making a provision workable and its objective achievable - The High Court in its Impugned Order resorted to reading down Rule 9(5) of the SARFAESI Rules not because its plain meaning would result in the provision being rendered invalid or unworkable or the statute’s objective being defeated, but because it would result in the same harsh consequence of forfeiture of the entire earnest-money deposit irrespective of the extent of default in payment of balance amount.
Thus, the High Court committed an egregious error by proceeding to read down Rule 9(5) of the SARFAESI Rules in the absence of the said provision being otherwise invalid or unworkable in terms of its plain and ordinary meaning without appreciating the purpose and object of the said provision.
Whether, the forfeiture of the entire earnest-money deposit amounts to Unjust Enrichment? - HELD THAT:- The concept of ‘Unjust Enrichment’ is a by-product of the doctrine of equity and it is an equally well settled cannon of law that equity always follows the law. In other words, equity cannot supplant the law, equity has to follow the law if the law is clear and unambiguous - The consequence of forfeiture of 25% of the deposit under Rule 9(5) of the SARFAESI Rules is a legal consequence that has been statutorily provided in the event of default in payment of the balance amount. The consequence envisaged under Rule 9(5) follows irrespective of whether a subsequent sale takes place at a higher price or not, and this forfeiture is not subject to any recovery already made or to the extent of the debt owed. In such cases, no extent of equity can either substitute or dilute the statutory consequence of forfeiture of 25% of deposit under Rule 9(5) of the SARFAESI Rules.
This Court in National Spot Exchange Ltd. v. Anil Kohli, Resolution Professional for Dunar Foods Ltd. [2021 (9) TMI 1156 - SUPREME COURT] after referring to a catena of its other judgments, had held that where the law is clear the consequence thereof must follow. The High Court has no option but to implement the law.
Thus, the High Court erred in law by holding that forfeiture of the entire deposit under Rule 9 sub-rule (5) of the SARFAESI Rules by the appellant bank after having already recovered its dues from the subsequent sale amounts to unjust enrichment.
Whether Any Exceptional Circumstances exist to set aside the forfeiture of the earnest money deposit? - HELD THAT:- This Court in its decision in ALISHA KHAN VERSUS INDIAN BANK (ALLAHABAD BANK) & ORS [2021 (12) TMI 1483 - SUPREME COURT] had directed the refund of the earnest-money deposit after forfeiture to the successful auction purchaser who was unable to pay the balance amount on account of the Pandemic.
In C. Natarajan [2023 (4) TMI 1232 - SUPREME COURT], this Court while affirming the decision of Alisha Khan (supra) observed that after the earnest-money deposit is forfeited, the courts should ordinarily refrain from interfering unless the existence of very rare and exceptional circumstances are shown.
In the case at hand, it is the respondent’s case that he was unable to make the balance payment owing to the advent of the demonetisation. The same led to a delay in raising the necessary finance. It has been pleaded by the respondent that the appellant bank failed to provide certain documents to him in time as a result of which he was not able to secure a term loan - However, the aforesaid by no stretch can be said to be an exceptional circumstance warranting judicial interference. We say so because demonetization had occurred much before the e-auction was conducted by the appellant bank. As regards the requisition of documents, the sale was confirmed on 07.12.2016, and the respondent first requested for the documents only on 20.12.2016, and the said documents were provided to him by the appellant within a month’s time i.e., on 21.01.2017. It may also not be out of place to mention that the respondent was granted an extension of 90-days’ time period to make the balance payment, and was specifically reminded that no further extension would be granted, in-spite of this the respondent failed to make the balance payment.
Thus, the High Court committed an egregious error in passing the impugned judgment and order. There are no other option but to set aside the impugned judgment and order passed by the High Court.
The appeals filed by the bank succeed and are hereby allowed.
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2024 (2) TMI 246
Seeking direction for an in-depth, thorough and time bound investigation by a SIT into various serious illegalities, violations and siphoning of funds committed by the promoters of Indiabulls Housing Finance Limited (IBHFL), its subsidiaries and their promoters - siphoning of funds by the IBHFL and other Indiabull group of companies - HELD THAT:- Applying the dictum of the Hon’ble Supreme Court in Vishal Tiwari Vs. Union of India [2024 (1) TMI 188 - SUPREME COURT] to the case in hand, this Court is of the opinion that the allegations levelled by the petitioner are not substantiated as these are not supported by any evidence. The balance sheets or other material placed on record is already available on the website of these companies and is thus already in public domain. Not only a large portion of alleged loans were repaid by the respondent- companies but also the loans were advanced against mortgages and securities furnished by the borrowers. Moreover, due to alleged complaints, the Government functionaries have already set in motion and necessary inspections have been carried out by NHB. The Ministry of Corporate Affairs is also in the process of further investigation.
In the considered opinion of this Court, due to articles published in magazine and newspaper, the tweets made by member of the petitioner-firm or a Member of Parliament, the share holders of accused-companies were jolted and they were made to suffer huge losses. It is settled position of law that the jurisdiction of investigation lies within the realm of investigating agency and a Court has no authority to interfere in the investigation until and unless there is grave miscarriage of justice or misuse of process of law. The investigation has to be transferred to CBI or SIT or any other agency only in exceptional cases and not as a matter of routine. There is no dispute to the position that necessary investigation in the present case has already been carried out by NHB and also the Ministry of Corporate Affairs is in the process of further investigation.
Finding no merit in the present petition, it is accordingly dismissed.
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