2026 Supreme(SC) 39

SUPREME COURT OF INDIA
J.K. MAHESHWARI, K. VINOD CHANDRAN, JJ.
Yerram Vijay Kumar – Appellant
Versus
The State of Telangana & Anr. – Respondents
Criminal Appeal No. 147 of 2026 (Arising out of SLP (Crl.) No. 11530 of 2024)
With
Rajeev Kumar Agarwal – Appellant
Versus
The State of Telangana & Ors. – Respondents
Criminal Appeal No. 148 of 2026 (Arising out of SLP (Crl.) No. 14783 of 2024)
Decided On : 09-01-2026

IMPORTANT POINTS
(1) Right recourse for a person, who makes allegation of fraud in affairs of a company is to file application under Section 213 of Companies Act before NCLT upon satisfying eligibility under Section 213(a) and 213(b) of Companies Act.
(2) Cognizance is taken of an offence and not of a section under law, and at the stage of framing charges, Court may add or remove sections.
(3) Mere institution or pendency of civil proceedings between parties cannot be a ground to quash criminal proceedings.
(4) Principles of Judicial Comity and stare decisis are applicable to High Court.

Headnote:

(A) Companies Act, 2013 – Sections 448 and 451 read with Section 212(6) – Indian Penal Code, 1860 – Sections 420, 406, 426, 468, 470, 471 and 120B – Criminal Procedure Code, 1973 – Section 482 [Section 528 of BNSS] – Cheating, criminal breach of trust, forgery and fraud and criminal conspiracy – Cognizance has been taken by Special Court under Section 448 and 451 of Companies Act – Section 448 itself does not lay down any punishment for its contravention – It simply lays down ingredients of offence of making a false statement – Section 448 of Companies Act cannot be read in isolation and must be read along with Section 447 of Companies Act – In case allegation of fraud under Section 447 of Companies Act is to be made out, complaint has to be made by Director, SFIO or an officer authorized by a written order of Government – Issue in present appeal is same as in earlier case and High Court ought to have considered its previous judgment which is on an identical question of law in almost similar factual situation – Principles of Judicial Comity and stare decisis are applicable to High Court – High Court in impugned judgment has not discussed or addressed provisions of law as contained in Sections 448/451 read with Section 212(6) of Companies Act nor has it referred to its previous judgment on similar facts. (Paras 33, 35, 37 and 41)

(B) Companies Act, 2013 – Sections 448 and 451 read with Section 212(6) – Indian Penal Code, 1860 – Sections 420, 406, 426, 468, 470, 471 and 120B – Criminal Procedure Code, 1973 – Section 482 [Section 528 of BNSS] – Cheating, criminal breach of trust, forgery and fraud and criminal conspiracy – Cognizance of offences – Anything that cannot be done directly, also cannot be done indirectly – Merely because there is bar under second proviso to Section 212(6) of Companies Act against taking cognizance of offence under Section 447 of Companies Act unless specific conditions mentioned therein are met, does not mean that cognizance may be taken by Special Court under Section 448 of Act without including punishment section [Section 447] on filing of a private complaint – Cognizance is taken of an offence and not of a section under law, and at the stage of framing charges, Court may add or remove sections – In present case, when there is specific requirement under law which acts as a pre-condition for taking cognizance under Section 447 of Companies Act, decision of Special Court to take cognizance under Section 448 of Companies Act without invoking Section 447 cannot be countenanced – Right recourse for a person, who makes allegation of fraud in affairs of a company is to file application under Section 213 of Companies Act before NCLT upon satisfying eligibility under Section 213(a) and 213(b) of Companies Act – Criminal proceedings to the extent of Section 448 and 451 of Companies Act quashed. (Paras 43, 44, 45, 46 and 47)

(C) Criminal Procedure Code, 1973 – Section 482 [Section 528 of BNSS] – Quashing of criminal case – Mere institution or pendency of civil proceedings between parties cannot be a ground to quash criminal proceedings – When multiple persons are made accused in respect of same set of facts, even if some of them are prosecuted against for offences under Companies Act and others are being prosecuted against only for offences under IPC, Special Court can try all accused persons together in order to avoid multiplicity of proceedings. (Paras 51 and 55)

Facts of the case:

Present appeals have been filed against the impugned judgment dated 20.06.2024 passed by the Single Bench of High Court for the State of Telangana at Hyderabad whereby petition under Section 482 of Code of Criminal Procedure, 1973 of Appellants – accused was dismissed. The prayer in said petition was to quash the criminal proceedings in complaint case bearing C.C. No. 58 of 2022 filed by Respondent No. 2 – Complainant against Appellants where Special Court for Economic Offences at Hyderabad has taken cognizance of offences under Sections 448 & 451 of Companies Act, 2013 and Sections 420, 406, 426, 468, 470, 471 & 120B of Indian Penal Code, 1860.

Findings of Court:

Judge of Special Court where the C.C. No. 58 of 2022 is pending shall take steps, in consultation with Principal District Judge of district to transfer complaint case to appropriate court having territorial jurisdiction to try complaint case. The said transfer shall be made within a period of 4 weeks and then the complaint case shall be adjudicated on its own merits, uninfluenced by any of the observations made hereinabove, as expeditiously as possible.

Result : Appeals partly allowed.