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TMI Blog2024 (1) TMI 1319X X X X Extracts X X X X X X X X Extracts X X X X ..... Mr. Neil Chatterjee, Adv., Mr. Raghav Luthra, Adv., Mr. Nitin Bajaj, Adv., Mr. Shaurya Chaurasiya, Adv., Mr. Avneesh Arputham, AOR, JUDGMENT VIKRAM NATH, J. & RAJESH BINDAL, J. 1. Leave granted. 2. Unscrupulous litigants should not be allowed to go scot-free. They should be put to strict terms and conditions including costs. It is time to check with firmness such litigation initiated and laced with concealment, falsehood, and forum hunting. Even State actions or conduct of government servants being party to such malicious litigation should be seriously reprimanded. In the instant case, we find initiation of criminal proceedings before a forum which had no territorial jurisdiction by submitting incorrect facts and giving frivolous reasons to entertain such complaints. A closer look at the respondent's actions reveals more than just an inappropriate use of jurisdiction. The core issue of the dispute, which involves financial transactions and agreements, clearly places it in the realm of civil and commercial law. Yet, the respondent chose to pursue criminal charges in a quest to abuse the criminal justice system with a motive to seek personal vengeance rather than seeking true ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t was forged, allegedly to have been executed in favour of Sushil Gupta, one of the accused (not before this Court). Some scheme of amalgamation was made by Gulab Buildtech and Verma Buildtech to amalgamate the aforesaid companies with BDR, as a result of which, the percentage of shareholding of the company reduced considerably. No notice was served on the company of the proposed amalgamation. The amalgamation was got approved from the Delhi High Court. The share certificates were allegedly never physically handed over to the complainant. 7. The complainant further alleged that when he asked the accused to return the loan with interest, initially time was sought stating that there is slump in the real estate market and thereafter, the accused started ignoring the complainant. That is when the complainant decided to take legal recourse against the accused. Prayer was made in the police complaint for registration of a case of cheating and forgery against the accused. While filing the complaint, the complainant had given his address as 'C/o A & A Earth Movers, D-9, Sector-2, Noida Sector-20, Gautam Budh Nagar, U.P.' 8. After investigation, the police found that a case was made out a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al and consequential to give effect to the above said resolution and collect the Share certificates." Second Resolution: AUTHORIZATION TO INVEST INTO THE EQUITY SHARES OF M/S GULAB BUILDTECH PRIVATE LIMITED. The Chairman apprised the Board of Directors of the Company about the benefit of investment into the equity shares of M/S GULAB BUILDTECH PRIVATE LIMITED offered by way of private placement. The Directors discussed about the same at length and the following resolutions were passed. "RESOLVED THAT the company be and is herewith authorized to make an investment of Rupees Five Crores Sixteen Lacs only (Rs.5, 16,00,000/-) in pursuance of the provision of the companies Act, 1956." "RESOLVED FURTHER THAT Mr. Narender Kumar and Mr. Tarun Kumar Director of the company be and are hereby severally authorized to do the necessary act including the signing of the documents, deed and agreement and other necessary paper which are incidental and consequential to give effect to the above said resolution and collect the Share certificates." 11. In 2012, when the petition [Company Petition No.287 of 2012] was filed seeking amalgamation of Gulab Buildtech and Verma Buildtech with BDR, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellants. 15. In fact, the dispute amongst the parties has already been referred to Arbitration by the Delhi High Court vide order dated 15.05.2019 and the company has already filed its claim before the sole Arbitrator. 16. The aforesaid facts clearly establish that no case was made out against the appellants. Further, there is no allegation pertaining to forging of any documents against them. It was a simple business transaction. Arm-twisting method to recover any dues cannot be permitted to be used. In support of the appellants' arguments, reliance was placed on the judgment of this Court in Randheer Singh v. The State of U.P. & others [2021 INSC 440: (2021) 14 SCC 626]. 17. It was submitted that there was total nonapplication of mind by the Trial court while passing summoning order, which is entirely non-speaking in nature. Even the High Court failed to consider the arguments raised by the appellants. ARGUMENTS OF THE RESPONDENT - COMPLAINANT 18. On the other hand, Mr. Vikas Singh, learned senior counsel for the respondent-complainant, submitted that solely on persuasion of the accused, huge amount of short-term loan was advanced. Subsequently, shares were allotted, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gar. The position is same in the case of Gulab Buildtech and Verma Buildtech. Though the complainant had invested crores of rupees in equity of the aforesaid two companies based at New Delhi, knowing well their place of business, yet in those cases, incomplete addresses showing them at Sector 20, Gautam Budh Nagar, was deliberately mentioned. It is sufficiently clear that the idea was to falsely create jurisdiction in Gautam Budh Nagar which did not actually lie there. 24. The falsehood in the complaint, filed with reference to the addresses of the accused, was established at the time of filing of charge-sheet. Whereas in the FIR, the addresses of all the accused given were incomplete merely mentioning the address as 'Sector 20, Gautam Budh Nagar', in the charge-sheet addresses of not only the appellants, namely, Rajesh Gupta and Dinesh Gupta, were found to be 'D-393, New Friends Colony, New Delhi, even Sushil Gupta and Baljeet Singh were also found to be residents of New Delhi. The following are the addresses of the parties involved in the matter: Sr. No. Party Party Name Address 1. Complainant Karan Gambhir N-56, Panchsheel Park, New Delhi, 110017. 2. Supporting Witnes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taken by the complainant to invest in the equity of Gulab Buildtech and Verma Buildtech to the tune of Rs.5,16,00,000/- and Rs. 11,29,50,000/- respectively. The said resolutions passed by the complainant have not been denied. Hence, the claim that the appellants had induced the complainant to advance loan and later on converted the loan into equity, is totally false. It was rather a deliberate decision taken by the Board founded on above-mentioned company resolutions. 28. Further, it is apparent that the complainant had concealed material facts which were within his knowledge at the time of filing of complaint. These facts pertained to the complainant's knowledge of the merger of Gulab Buildtech and Verma Buildtech with BDR, details whereof are noted hereinafter. 29. A Company Petition No.287 of 2012 was filed in the High Court for merger of the Gulab Buildtech and Verma Buildtech with BDR. As required, due notice was issued to all the concerned stake holders including all the shareholders and creditors. The same was published in the newspapers also. The complainant neither raised any objection nor appeared before the High Court. After considering the material placed on record, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2010 for a period of one year. However, when the same was not returned, no steps were taken by the complainant to recover the same until the FIR in question was registered on 29.07.2018 i.e. 8 years & 7 months later. 33. Further, the complainant came to know about the merger of the Gulab Buildtech and Verma Buildtech with BDR in the year 2013 itself. However, even after dismissal of the application filed for recall of the merger order passed by the High Court on 15.03.2016, no steps were taken to recover the amount, except getting the FIR registered more than two years later. All these facts clearly reflect upon the ill designs of the complainant. 34. The entire factual matrix and the time lines clearly reflects that the complainant deliberately and unnecessarily has caused substantial delay and had been waiting for opportune moment for initiating false and frivolous litigation. 35. Further, it has been noticed by the High Court in the impugned order that on an application filed by the appellants, an Arbitrator was appointed by the Delhi High Court vide order dated 15.05.2019 to settle the dispute amongst the parties and the said matter was still pending. 36. In view of the af ..... X X X X Extracts X X X X X X X X Extracts X X X X
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