Shanavas P Adimakutty v. State of Kerala, Sub Inspector of Police, Hill Palace Police Station, and Jeril Philip (Defacto Complainant)

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR.JUSTICE ZIYAD RAHMAN A.A. WEDNESDAY, THE 9[TH] DAY OF MARCH 2022 / 18TH PHALGUNA, 1943 CRL.MC NO. 8833 OF 2019** **AGAINST THE ORDER/JUDGMENT IN CC 1078/2018 OF JUDICIAL FIRST CLASS MAGISTRATE COURT, TRIPUNITHURA PETITIONER/AACUSED NO.1:** SHANAVAS P ADIMAKUTTY AGED 42 YEARS S/O. ADIMAKUTTY, PUTHIYAVEETTIL HOUSE, EDATHURUTHY P O, THRISSUR DISTRICT, PIN-680703. BY ADVS. P.N.SUKUMARAN SRI.AKHIL S.VISHNU SHRI.SOORAJ S ## **RESPONDENT/DE FACTTO COMPLAINANT** 1 STATE OF KERALA REPRESENTED BY THE PUBLIC PROSECUTOR, HIGH COURT OF KERALA, ERNAKULAM-682031. 2 SUB INSPECTOR OF POLICE, HILL PALACE POLICE STATION, 682309 3 JERIL PHILIP, AGED 39 YEARS, S/O. PHILIPPOSE JOHN, ELLIMULLIL HOUSE, ARUNAGIRI COLONY, KAKKAVAYAL P O, WAYANAD DISTRICT-673122. ADV. RANJIT GEORGE, SR. PP THIS CRIMINAL MISC. CASE HAVING COME UP FOR ADMISSION ON 09.03.2022, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: Crl.M.C No.8833 of 2019 2 ## **O R D E R** The petitioner herein is the 1[st] accused in C.C. 1078/2018 on the file of the Judicial First Class Magistrate Court, Thripunithura. The aforesaid case arises from Crime No.2120/2017 on the file of the Hill Palace Police Station, which was initially registered for the offences punishable under Sections 406, 420, 468 read with 34 of the India Penal Code. The aforesaid crime was registered based on a private complaint submitted by the 3[rd] respondent herein which was referred for investigation to the police under Section 156 (3) Cr.P.C. 2. The allegation against the petitioner and other accused is that, by offering returns to the 3[rd] respondent/defacto complainant, the petitioner and the other accused persuaded the 3[rd] respondent to invest an amount of Rs.25,00,000/- in the company named Valesco Health Care Pvt Ltd in which the petitioner and the other accused were directors. The case put forward in the private complaint is that the aforesaid investment was made by the defacto complainant, as he was made to believe that he would be inducted in the said Company as one of the directors of the company and shares would be issued in his name. Later, the petitioner and the other Crl.M.C No.8833 of 2019 3 accused issued fake share certificates, and he was not made as director of the company. The complaint was submitted in such circumstances. 3. After registration of the FIR, an investigation was conducted by the police, and Annexure-3 charge sheet was submitted. In the final report, the offence under Section 468 is not seen incorporated as it was revealed during the investigation that the de facto complainant was issued with the documents relating to the transfer of shares in the company. The final report contains the offences under Sections 406 and 420 read with Section 34 of the IPC. This Crl.M.C is filed seeking to quash Annexure-2 final report and all further proceedings in C.C 1078/2018 which is now pending before the Judicial First Class Magistrate Court, Thripunuthura. 4. Heard Sri.Akhil S.Vishnu, learned counsel appearing for the petitioner and Sri.Renjit George, learned Public Prosecutor appearing for the State. Even though notice was served upon the 3[rd] respondent/ defacto complainant, there is no appearance. 5. The specific contention put forward by learned counsel for the petitioner is that, the transaction, which is the Crl.M.C No.8833 of 2019 4 subject matter of the offence, is civil in nature, and no criminal offences are revealed from the averments as well as the materials produced by the prosecution. The learned counsel for the petitioner also submits that the defacto complainant has already instituted O.S No.266/2018 before the Sub Court, Ernakulam, for realizing the amounts claimed to have been invested by the plaintiff in the company in which the petitioner is one of the directors. The said suit is pending and it is also submitted by him that the averments contained in the aforesaid civil suit, the plaint of which is produced as Annexure-5 in this case, are precisely the same as made in the private complaint. In such circumstances, he seeks to quash the further proceedings pursuant to Annexure-A2. 6. Learned Public Prosecutor would oppose the same by pointing out that the question whether the contentions put forward by the learned counsel for the petitioner basically relates to certain factual disputes that cannot be considered in a proceeding of this nature. Hence he prays for dismissal of this Crl.M.C. 7. The question that arises here is as to whether there is any justification in invoking powers of this Court under Crl.M.C No.8833 of 2019 5 Section 482 Cr.P.C. When I examine the materials available on record in that perspective, it can be seen that the very basis for instituting a criminal prosecution is that, after accepting the amounts from the defacto complainant herein, fake share certificates were issued to them. Based on the allegation, the offence punishable under Section 468 was also sought to be incorporated in the case against the petitioner. However, after completing the investigation, the police found that the documents relating to the transfer of shares were issued to the defacto complainant, and there is no substance in initiating prosecution against the petitioner and other accused for the offence under Section 468 of IPC. The allegation in the final report is confined to matters relating to offences punishable under Sections 406 and 420 of IPC. When I consider the materials in support of the said offences, it can be seen that the basic allegations are relating to certain investments that the defacto complainant made in the company in which the petitioner and the other accused were directors. One of the allegations which formed the subject matter of the private complaint is that such investment was made by making the defacto complainant believe that he would be issued with the Crl.M.C No.8833 of 2019 6 shares of the company and would be made as one of the directors. Annexure-3 is the document indicating the transfer of shares which was forwarded to the 3[rd] respondent herein for further action at his end. Annexure-4 communication would suggest that the de facto complainant received the aforesaid documents. In such circumstances, it is evident that consequent to the promise made, the petitioner has forwarded relevant documents for transfer of shares to the defacto complainant, which were acknowledged by the 3[rd] respondent. As regards the allegation of failure to receive returns as promised, in my view, the same by itself cannot attract a criminal offence, as admittedly, going by the averments in the complaint itself, the amounts were handed over as investments. Therefore, such a transaction was subject to various contingencies in connection with the business of the company. In such circumstances, as admittedly the payment was made towards investment, even if it lacked returns, that by itself cannot attract any criminal offence, in the absence of any other materials indicating any dishonest intention on the part of the accused. In this case, on examining the materials available on records, I am of the view that no such dishonest contention can be deduced from the Crl.M.C No.8833 of 2019 7 available materials. In the absence of the same, the disputes which arose from the transaction can only be treated as a civil transaction. In this case, the defacto complainant has already instituted a civil suit for realising the aforesaid amount. 8. The learned counsel places reliance upon the judgment rendered by the Honourable Supreme Court in ## **Vijayasarathy R.K (Prof) and Another v. Sudha Seetharam** **and Another 2019 (2) KHC SN 16** wherein it was observed that when the dispute is basically civil in nature, the powers of the High Court under Section 482 can be invoked for quashing the proceedings. When I examine the materials available on record, I am convinced that the fundamental dispute involved herein is civil in nature as it pertains to certain business transactions in connection with the investments made. In such circumstances, I am unable to find any reason to discard the relief sought by the petitioner in this Crl.M.C. In the result, this Crl.M.C is allowed and all further proceedings in Annexure-2 final report submitted in Crime No.2120/2017 of Hill Palace Police Station and all further proceedings in C.C. No.1078/2018 on the file of the Judicial First Crl.M.C No.8833 of 2019 8 Class Magistrate Court, Thripunuthura as against the petitioner herein are hereby quashed. Sd/- **ZIYAD RAHMAN A.A.** **JUDGE** rpk Crl.M.C No.8833 of 2019 9 ## **APPENDIX OF CRL.MC 8833/2019** |PETITIONER|ANNEXURES| |---|---| |ANNEXURE 1|TRUE COPY OF THE FIR ALONG WITH THE| ||COMPLAINT IN CRIME NO.2120/2017 OF HILL| ||PALACE POLICE STATION.| |ANNEXURE 2|CERTIFIED COPY OF THE FINAL REPORT IN| ||CC NO.1078/18 FILED BEFORE THE JFCM| ||COURT-THRIPUNITHURA.| |ANNEXURE 3|TRUE COPY OF THE SECURITIES TRANSFER| ||FORM SEND TO THE DE FACTO COMPLAINANT.| |ANNEXURE 4|TRUE COPY OF THE E-MAIL DATED| ||28.12.2016 SEND TO THE SECOND ACCUSED| ||BY THE DE FACTO COMPLAINANT.| |ANNEXURE 5|TRUE COPY OF THE SUIT FILED AS OS| ||NO.266/2018 BY THE DE FACTO| ||COMPLAINANT, BEFORE THE SUB COURT,| ||ERNAKULAM.| |ANNEXURE 6|TRUE COPY OF THE COMPLAINT FILED BY THE| ||PETITIONER BEFORE THE JFCM COURT,| ||THRIPUNITHURA.|