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SUPREME COURT OF INDIA
B.R. GAVAI, K.V. VISWANATHAN, JJ.
K. Bharthi Devi and Another – Appellants
Versus
State of Telangana and Another – Respondents
Criminal Appeal No. 4113 of 2024 [Arising Out of Special Leave Petition (Criminal) No. 4353 of 2018]
Decided On : 03-10-2024
Indian Penal Code, 1860 – Sections 120-B read with Sections 420, 409, 467, 468 and 471 [Bharatiya Nyaya Sanhita, 2023 – Section 61(2) read with Sections 318(4), 316(5), 338, 336(3) and 340(2)] – Prevention of Corruption Act 1988 – Section 13(1)(d) and 13(2) – Criminal Procedure Code, 1973 – Sections 320 and 482 [Bharatiya Nagarik Suraksha Sanhita, 2023 – Sections 359 and 528] – Criminal conspiracy, cheating and forgery – Cognizance of offence – Settlement between parties – Appellants are wives of original accused – There are certain offences which overwhelmingly and predominantly bear civil flavour having arisen out of civil, mercantile, commercial, financial, partnership or such like transactions or offences arising out of matrimony, particularly relating to dowry, etc. or a family dispute, where wrong is basically to victim and offender and victim have settled all disputes between them amicably, High Court would be justified in quashing criminal proceedings, even if offences have not been made compoundable – In present case, after receipt of amount under OTS, Bank had also decided to close loan account – Dispute involved predominantly had overtures of a civil dispute – In view of settlement between parties in proceedings before DRT, possibility of conviction is remote and bleak – Continuation of criminal proceedings would put accused to great oppression and prejudice – This was a fit case wherein High Court ought to have exercised its jurisdiction under Section 482 Cr.P.C. and quash criminal proceedings – Criminal proceedings against appellants quashed and set aside. (Paras 25, 34, 37 and 39)
Facts of the case:
Present appeal challenges final judgment and order dated 1st September 2017 passed by High Court of Judicature at Hyderabad for State of Telangana and State of Andhra Pradesh, whereby High Court dismissed the Criminal Petition filed by the accused persons, including appellants herein, under Section 482 of Code of Criminal Procedure, 1973 thereby seeking quashing of charge-sheet in C.C. No. 16 of 2014 on the file of Principal Special Judge for CBI Cases.
Findings of Court:
Impugned judgment and order dated 1st September 2017 passed by the High Court of Judicature at Hyderabad for State of Telangana and the State of Andhra Pradesh in Criminal Petition No. 5778 of 2016 quashed and aside. Criminal proceedings against the appellants in C.C. No. 16 of 2014 on file of Principal Special Judge for CBI Cases, also quashed and set aside.
Result : Appeal allowed. Criminal proceedings quashed.
JUDGMENT :
B.R. GAVAI, J.
1. Leave granted.
2. The present appeal challenges the final judgment and order dated 1st September 2017 passed by the High Court of Judicature at Hyderabad for the State of Telangana and the State of Andhra Pradesh, whereby the High Court dismissed the Criminal Petition No. 5778 of 2016 filed by the accused persons, including the appellants herein, under Section 482 of the Code of Criminal Procedure, 1973 (“Cr.P.C.” for short) thereby seeking quashing of the charge-sheet in C.C. No. 16 of 2014 on the file of Principal Special Judge for CBI Cases, Nampally, Hyderabad (“trial Court” for short).
3. Shorn of details, the case of the prosecution is as given below.
3.1 K. Suresh Kumar (Accused No. 1), the Sole Proprietor of M/s Sirish Traders, a firm engaged in processing of Uradh Dhall, was granted various credit facilities in the group loan account by the Indian Bank, Osmanganj Branch, Hyderabad (“respondent No. 2 Bank” for short). The credit facilities were secured by collateral security executed by the accused persons including the present appellants who are Accused No. 3 & 4.
3.2 Since the borrowers/mortgagors (Accused Nos. 1-5) failed to service the interest and re-pay the dues, the group loan account was declared a Non-Performing Asset on 31st March 2010.
3.3 To realize the outstanding amount, the respondent No. 2 Bank filed an Original Application being OA No. 253 of 2010 before the Debts Recovery Tribunal, Hyderabad (“DRT” for short) for recovery of amounts due.
3.4 During the pendency of the proceedings before the DRT, the respondent No. 2 Bank came to know that some of the title documents executed by the accused persons by virtue of which equitable mortgage was created were not original documents, rather the same were fake, forged and fabricated.
3.5 The respondent No. 2 Bank, accordingly, lodged a written complaint dated 3rd September 2012. Based on the said complaint, the Central Bureau of Investigation – Economic Offence Wing (CBI-EOW) Chennai registered an FIR No. RC.14/E/2012 dated 15th September 2012.
3.6 The CBI-EOW Chennai after investigation prima facie found that offences punishable under Sections 120-B read with 420, 409, 467, 468 and 471 of Indian Penal Code 1860 (“IPC” for short) and Section 13(1)(d) and 13(2) of the Prevention of Corruption Act 1988 (“PC Act” for short) have been committed. The CBI filed charge-sheet dated 27th December 2013 in the trial Court and prayed that the trial Court take cognizance of the said offences committed by the accused persons.
3.7 Since the proceedings before the DRT were still pending, the borrowers/ mortgagors (Accused Nos. 1-5) approached the respondent No. 2 Bank for settlement of the amount due regarding the group loan accounts. To that effect, a One Time Settlement (“OTS” for short) dated 19th November 2015 of Rs. 3.8 crores was offered to the respondent No. 2 Bank for settling all the dues. The same was accepted by the respondent No. 2 Bank. The OTS amount was paid, and the respondent No. 2 Bank issued a No Dues Certificate dated 21st November 2015 to the borrowers/guarantors.
3.8 When the matter stood thus, the Accused Nos. 1 to 5, including the present appellants, filed a Criminal Petition bearing No. 5778 of 2016 on 18th April 2016 before the High Court under Section 482 Cr.P.C. seeking quashing of the charge-sheet filed before the trial Court by the CBI.
3.9 During the pendency of the Criminal Petition before the High Court, the DRT vide order dated 4th May 2016, recorded that the matter has been settled as per the OTS and disposed of the OA as settled, in full satisfaction of the dues of the respondent No. 2 Bank.
3.10 The High Court, however, vide the impugned final judgment and order dismissed the Criminal Petition filed by the Accused Nos. 1 to 5 holding that the settlement arrived at was only a private settlement and was not a part of any decree given by any court. The charges include the use of fraudulent, fake and forged documents that were us
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