2023 (6) TMI 855 - HC - Companies Law

Court dismisses revision petition, allows criminal proceedings. Allegations deemed plausible, require further investigation.

Ramesh Sharan Rai & Ors. and Sanjay Kumar Mishra Versus The State of West Bengal & Anr.

The court dismissed the revision petition, allowing the criminal proceedings to continue. It found no reason to interfere with the investigational ... Prosecution proceedings against the petitioners / accused - Allegation of illegal removal complainant from Directorship - Using forged signatures and uploading DIR-12 with resignation letter - Allegation of mismanagement and oppression - authority to convene any extraordinary general meeting of the Company - whether the criminal proceeding instituted against the petitioners is liable to be quashed under Section 482 of the Cr.P.C.? HELD THAT:- With extensive scope and ramification, inherent powers under Section 482 of the Criminal Procedure Code include the power to stop any criminal case pending before any court subordinate to the High Court. Depending on the specifics of a case, these powers may be used to secure the ends of justice, prevent abuse of any court's process, and issue any orders as may be necessary to give effect to any order under the Code. The court can always take note of any injustice and stop a criminal proceeding by using its authority under Section 482 of the Criminal Procedure Code. No other clause of the Code restricts or limits their capabilities. Such natural powers should only be used sparingly and with caution. In State of Haryana v. Bhajan Lal [1990 (11) TMI 386 - SUPREME COURT], a two-Judges Bench of the Supreme Court of India considered in detail the provisions of Section 482 and the power of the High Court to quash criminal proceedings or FIR where it was held that The Government order authorised the Inspector General of Police to investigate only the offences failing under Section 5 of the Act. Therefore, the SHO who has taken up the investigation of the offences inclusive of those under Section 161 and 165 IPC is not at all clothed with any authority to investigate these two offences, registered under the IPC, apart from the offence under Section 5(2) of the Act. The matter at hand is not a rare case that justifies the Court's interference at the investigation stage. The allegation in the FIR makes out a prima facie case against the accused, and for this reason, the FIR registered in the Hare Street Police Station under Sections 120B/406/465/467/468/471/420 of the Indian Penal Code, 1860 should not be quashed. There are no reason to interfere with the investigational process of the investigating agency in the instant case. Criminal proceeding shall continue - the instant revision is dismissed on contest. Issues Involved:1. Locus standi of the complainant to file the complaint.2. Jurisdiction of Hare Street Police Station to register the FIR.3. Validity of the allegations of forgery and criminal liability.4. Applicability of Section 482 of the Cr.P.C. to quash the FIR.Summary:Issue 1: Locus Standi of the ComplainantThe petitioner argued that the opposite party No. 2, Mr. Deepak Joshi, does not have the locus standi to file the complaint as he had resigned from the directorship of Palogix on 18th February 2023. The petitioner also claimed that Mr. Joshi had no authority to use the company's seal in the complaint. However, Mr. Joshi contended that he had not resigned and that his signature on the resignation letter was forged.Issue 2: Jurisdiction of Hare Street Police StationThe petitioner argued that Hare Street Police Station had no jurisdiction to register the FIR as the registered office of Palogix is under the jurisdiction of Topsia Police Station. However, the FIR was registered at Hare Street Police Station on the basis that Godavari Commodities Limited, the majority shareholder, has its registered office within its jurisdiction.Issue 3: Validity of Allegations of Forgery and Criminal LiabilityThe petitioner argued that the allegations of forgery are baseless and that the criminal proceeding should be quashed. However, the court noted that the allegations made in the FIR, such as forgery of Mr. Joshi's signature and unauthorized access to his email, prima facie constitute offences under Sections 468 and 471 of the IPC. The court emphasized that the investigation should proceed to verify these allegations.Issue 4: Applicability of Section 482 of the Cr.P.C. to Quash the FIRThe court referred to the guidelines laid down by the Supreme Court in State of Haryana v. Bhajan Lal and other cases, emphasizing that inherent powers under Section 482 should be exercised sparingly and only in rare cases. The court found that the allegations in the FIR were neither absurd nor inherently improbable and that there were sufficient grounds for proceeding with the investigation. Therefore, the court decided not to quash the FIR.Conclusion:In view of the above discussion, the court dismissed the revision petition, allowing the criminal proceedings to continue. The court found no reason to interfere with the investigational process of the investigating agency in the instant case.