High Court allows proceeding in Complaint Case No. 720 of 2017, cites evidence for prima facie case. Accused can seek discharge.

The High Court declined to quash the proceeding in Complaint Case No. 720 of 2017, involving allegations under the Companies Act, 1956 and 2013, and various sections of the IPC. The court found that there was sufficient evidence to establish a prima facie case against the accused for offenses related to illegal gains and money laundering. However, the court allowed the accused to seek discharge by filing an appropriate application before the trial court within a specified timeline, ensuring no coercive action would be taken against them during this period. The judgment clarified that its observations were limited to the application and would not affect the case's overall merits.

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Issues:
Jurisdiction of the High Court under Section 482 Cr.P.C. to quash the proceeding in a complaint case involving allegations under various sections of the Companies Act, 1956 and 2013.

Analysis:
The application sought to quash the proceeding in Complaint Case No.720 of 2017, initiated by the Serious Fraud Investigation Office under multiple sections of the IPC and Companies Act, 1956 and 2013. The objection to the maintainability of the application was raised on the grounds of jurisdiction, contending that the High Court lacked jurisdiction. However, the counsel for the applicants argued that the cause of action for the case arose in various places in Uttar Pradesh, emphasizing that the alleged crimes were committed extensively in different districts of Uttar Pradesh. The counsel relied on Section 177 Cr.P.C. to support the claim that the place of the crime determines jurisdictional rights. The absence of an express bar in the Companies Act or Cr.P.C. for the High Court's jurisdiction under Section 482 Cr.P.C. was highlighted, asserting that the scattered cause of action across Uttar Pradesh justified the High Court's jurisdiction.

The judgment further delves into the specifics of the allegations, emphasizing that the applicants were accused of amassing money through illegal mining in district Saharanpur, channelizing it through non-existing entities to purchase sugar mills at lower prices in auctions held in Lucknow. The interconnected nature of the alleged crimes across various districts in Uttar Pradesh was highlighted, indicating that the auction purchase in Lucknow was just a part of the larger scheme involving money laundering and illegal activities in different locations. The judgment also addressed the objections raised regarding the investigation, with the applicants claiming shoddy investigation practices including recording statements of deceased individuals.

Regarding the merits of the case, the counsel for the applicants argued that they were innocent purchasers of the sugar mills and were being made scapegoats to cover up the misdeeds of high officials. The counsel also raised concerns about the complainant being the investigating officer and highlighted alleged flaws in the investigation process. However, the Additional Solicitor General countered these arguments, asserting that ample evidence existed against the applicants for various offenses related to illegal gains and money laundering. The judgment concluded that the summoning order was based on material collected during the investigation, indicating a prima facie case for summoning the accused.

Ultimately, the High Court refused to interfere with the summoning order but allowed the applicants to seek discharge by filing an appropriate application before the trial court. The court provided a timeline for the applicants to file the discharge application and specified that no coercive action would be taken against the applicants during this period. The judgment emphasized that the observations made in the order were specific to the application and would not impact the merits of the case beyond its scope.

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