IMPORTANT POINT
Court must guard against camouflaged criminal cases clothed in high moral fiber and strong legal content.

JUDGMENT

V. Ramasubramanian, J.

1. Challenging an order passed by the High Court for the State of Telangana in two interlocutory applications granting stay of all further proceedings including the arrest of the Respondents 1 to 3 herein (petitioners before the High Court), pending two main petitions for quashing the criminal complaints in Crime Nos. 218 and 222 of 2021 of Banajara Hills Police Station, Hyderabad, the de facto complainant, has come up with these Special Leave Petitions.

2. We have heard Shri Dil Jit Singh Ahluwalia, learned counsel for the petitioner and Mr. Siddharth Luthra and Mr. Niranjan Reddy, learned senior counsel appearing for the Respondent Nos. 1 to 3 herein.

3. The petitioner herein filed two complaints on the file of the III Additional Chief Metropolitan Magistrate at Hyderabad against the Respondents 1 to 3 herein on 19.02.2021. The learned Magistrate passed an order under Section 156(3) of the Code of Criminal Procedure, directing the police to register cases and take up investigation, pursuant to which, the Police registered two First Information Reports (FIR for short) in Crime Nos. 218 and 222 of 2021 respectively on 12.03.2021 and 13.03.2021.

4. The Respondents 1 to 3 herein who were the accused in those two complaints were described in those two complaints respectively as (i) Presently Chairman and erstwhile Senior Vice Chairman; (ii) Managing Director and CEO; and (iii) Presently Vice Chairman and erstwhile Chairman of A.P. Mahesh Cooperative Urban Bank. The offences complained of by the petitioner against the Respondents 1 to 3 herein were under Sections 409, 420, 467, 468, 471 and 477A read with 120B IPC. It is necessary to take note at this stage that the Cooperative Bank involved is actually a multistate cooperative society governed by the Multi­State Cooperative Societies Act, 2002.

5. Immediately after the registration of the complaints, the Respondent Nos. 1 to 3 herein filed two petitions in Criminal Petition Nos. 2370 and 2371 of 2021 under Section 482 of the Code seeking to quash the criminal complaints. Pending disposal of the criminal complaints, the Respondents 1 to 3 herein sought interim stay of all further proceedings including their arrest, in FIR Nos. 218 and 222 of 2021.

6. The applications for stay in I.A. Nos. 1 and 1 of 2021 were hotly contested by the petitioner herein, as the petitioner was arrayed as the second respondent in the quash petitions.

7. After hearing the Respondents 1 to 3 herein (persons accused) and the petitioner herein (de facto complainant), the High Court passed a reasoned order on 27.04.2021 granting stay of all further proceedings in both the complaints. It is against the said order that the petitioner has come up with the above SLPs.

8. Briefly and broadly, the reasons provided by the learned Judge of the High Court for granting stay of further proceedings in the complaints are as follows:­

(i) That while one of the two complaints relates to ‘loan fraud’, the other relates to ‘voter fraud’;

(ii) That the term of office of the Board of Directors of the Cooperative Bank expired in April, 2020 and the election process that was set in motion in March, 2020 culminated in the holding of elections on 20.12.2020;

(iii) That there was a huge acrimony surrounding the elections, leading to the filing of a batch of writ petitions both before and after the conduct of elections;

(iv) That there was an over­lapping of the allegations relating to ‘loan fraud’ and ‘voter fraud’ in the writ petitions also, challenging or supporting the election process;

(v) That in the said batch of writ petitions, another learned Judge of the same High Court had passed a common order on 08.01.2021, directing the results of the election to be declared and the newly elected Board to take charge but directing the newly elected Directors not to take policy decisions until further orders;

(vi)