TMI Blog2013 (4) TMI 962X X X X Extracts X X X X X X X X Extracts X X X X ..... he Directors of one public limited company, namely M/s. Lyons Industrial Enterprises Ltd., had floated the public issue of equity shares of their company by signing prospectus, wherein they have shown false and improper information and thereby they have given false promise based upon false and concocted information in the prospectus of the company and collected huge amount as value of equity shares from the investors and thereby they have cheated public at large and hence they have committed offences under the IPC as quoted hereinabove as well as under sections 63, 68 and 628 of the Indian Companies Act. The respondent no. 2 has, therefore, filed one another complaint before the Ld. Chief Metropolitan Magistrate at Ahmedabad on 19/4/2002, which is registered as Criminal Case No. 91/2002, wherein the Addl. Chief Metropolitan Magistrate, Ahmedabad has passed an order to issue warrant against the petitioners. Though name of any of the accused is not disclosed in the FIR I-1160/2004, which is filed at later stage, the respondent no. 2 has, while filing the complaint under the Companies Act on 19/4/2002, disclosed the names of these persons as accused. 4 On perusal of record, it seem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of State of Haryana v/s. Bhajanlal reported AIR 1992 SC 604 and quoted the grounds confirmed by the Hon ble Apex Court for consideration in such type of cases. It is further contended by the petitioners that practically they have resigned as Directors of the company in the year 1996 and proof of such resignations is produced on record at Annexure-C in both petitions. It is also contended by both the petitioners that since they had remained as Directors of the company for very short tenure, they have never attended any board meeting or general meeting of the company and they have never received any sitting fee or remuneration or any kind of benefits from the company. It is also contended that they are not subscribers to Memorandum of Association and they have not played any role either direct or indirect into the affairs of the company at any stage. It is further contended that in response to the notice issued by respondent no. 2 regarding such offences, both the petitioners have submitted their detailed reply, copies of which are produced at Annexures D and E respectively in both the petitions, wherein it is categorically conveyed to the respondent by both the petiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me, is to be punished only once and not repeatedly for the same set of crime and evidence even if the alleged act results into different offences or offence under the different provisions of law. 10 In the present case, irrespective of factual details and its merits, the fact remains that though respondent no. 2 has filed first complaint on 19/4/2002 before the Addl. Chief Metropolitan Magistrate, Ahmedabad, which is registered as Criminal Case No. 91/2002, disclosing the names of all the Directors of the company, namely M/s. Lyons Industrial Enterprises Ltd., alleging the same set of facts regarding alleged mis-deeds by such Directors in floating the public issue for the company by preparing improper prospectus, there is not a whisper in such a complaint that how the accused in such complaint had committed the offences, if any, under the IPC. It is certain that in such complaint, the Court has issued summons and there is no whisper in the affidavit-in-reply filed by the respondent no. 2 on 9/4/2013 about such complaint, which was filed before the Competent Court. Surprisingly, pending such criminal complaint before the competent Court, instead of disclosing relevant fact regard ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contended that since the present petitioners have also signed the prospectus, they cannot escape from their liability as of Directors. With this reference, if we peruse both the complaints, copies of which are on record at Annexures- A and E, it becomes clear that practically there are no whisper or allegations so far as the ingredients of cheating, etc., are concerned, on the contrary, what is alleged is to the effect that the company has failed to file complaint with the provisions of sections 129, 162 and 200 of the Companies Act from the year 2002 and onwards. Even in the first complaint before the Addl. Chief Metropolitan Magistrate being Criminal Case No. 91/2002, the allegation is mainly regarding subsequent balance-sheets filed by the company with the complainant. 12 In support of their submission, they have relied upon the above referred three decisions of Radhey Shyam Khemka [supra], Bajjoori Kanthaiah [supra] and Goloconda Linga Swamy [supra]. On perusal of such judgments, though it is clear that failure of promoters for repayment to investors, entitles the investors to prosecute the promoters under the Indian Penal Code and thereby it would not be advisable for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lear that when FIR is not disclosing commission of an offence without anything being added or subtracted from the recitals therein, quashing of the FIR would be proper. However, Ld. Advocate Mr. M. Iqbal A Shaikh has relied upon the observations with reference to the case of R P Kapur v/s. State of Punjab reported in AIR 1960 SC 866 in para 6 of such case under reference, wherein also practically the Hon ble Apex Court has summarized some categories of cases where inherent power can and should be exercised to quash the proceedings. It is submitted that the present case does not fall within the scope of cases which is considered by the Hon ble Apex Court in such case. However, it goes without saying that in addition to the cases listed in such reported case, if there is more than one complaint for the same set of allegations and for the same offence, then certainly, since multiple complaint for the same offence cannot be continued, Court can quash and set aside such second or next complaint. It is simple and clear that while deciding any particular case unless the Court has come across all type of irregularities that may be decided either by investigating agency or by the concerned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n receipt of every subsequent information in respect of the same offence or same occurrence even if it is giving rise to one or more cognizable offences and that only first information about commission of an offence which is under consideration can be regarded as FIR and all such subsequent information will be covered by section 162 of the Code. Even if after conclusion of first investigation, any further information pertaining to same incident is brought out, the same is to be produced with the initially instituted complaint and not in a second complaint. 16 The petitioners are also relying upon the decision rendered in the case of G. Sagar Suri v/s. State of U.P. Reported in 2000 SC [Criminal] 513 wherein it is held that the High Court can quash the criminal proceedings even when application for discharge of accused is pending with the Trial Judge though it is stated that such powers should be exercised cautiously, the Hon ble Apex Court has stated that when complaint under section 138 of the Negotiable Instruments Act is pending, second complaint under sections 406/420 of the IPC would amount to abuse of process of law and hence the proceedings of second complaint is liable t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t no. 2 was very much aware about the acceptance of resignation by petitioners in the year 1996 and activities of the company right from the year 1993. However, it seems that the complainant had waited upto the year 2002 for filing the first complaint and upto the year 2004 for filing second complaint by disclosing same set of information in two similar complaints. Therefore, when the complainant does not have any better or correct information or evidence for lodging the second complaint, it would be proper and appropriate for the complainant to take appropriate steps in the first complaint itself for addition of new sections and charges. Instead of requesting the competent Court where first complaint is pending, the action of the complainant to file second complaint without disclosing the names of the accused, though such names are already disclosed in the first complaint, before the police authority, so as to enable them to call upon different persons as Directors of the company, without confirming that whether they are actually involved in the commission of offences or not, would certainly amount to taking disadvantage of harassing the accused and, therefore, such activities of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... east it can be said that even if the complainant is of the view that the petitioners have committed several other offences under the IPC or any other Act, then they could proceed with the first complaint itself instead of filing second complaint. 20.2 In All Cargo Movers [I] Pvt. Ltd. v. Dhanesh Badarmal Jain reported in AIR 2008 SC 247 the Hon ble Apex Court has again categorically observed and held that when complaint is filed after a year of filing first litigation, in this case civil suit, without entering into the factual details of previous litigation and the complaint, the substance of the complaint is to be seen and mere use of the expression cheating in the complaint is of no consequence. 20.2.1 In the present case also, except mentioning of the certain words including word cheating in the complaint filed before the Police, there is no averments about deceive, cheating or fraudulent intention of the accused at the time of issuing prospectus where-from it can be inferred that the petitioners had intention to deceive the public. Therefore, even if given face value to the allegations made in the complaint, if it does not disclose any offence, such complaint deserves t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and factual details for which already one Criminal Case is pending before the Addl. Chief Metropolitan Magistrate. Therefore, submission of the respondent no. 2 that in addition to offences under the Companies Act, when petitioners have committed offences under the IPC, they are entitled to file separate complaints, cannot be accepted if at all the respondent no. 2 is of the opinion that the petitioners shall be charged and tried for the offences under the IPC also, then they could have certainly taken appropriate steps to add such charges in the complaint being Criminal Case No. 91/2002, which is already pending before the Addl. Chief Metropolitan Magistrate, Ahmedabad. It is clear and certain that when the entire allegations are based upon the factual details for which documentary evidence is already available with the complainant/ respondent no. 2, there is no reason for filing fresh complaint before the police authority for further investigation as alleged. 22 Therefore, both the petitions are allowed, as prayed for. Thereby complaint being C.R. No. I-1160/2004 pending with the Navrangpura Police Station upon complaint by respondent no. 2 on 18/12/2004 is hereby quashed and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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