Criminal proceedings cannot be pursued for a purely civil dispute, especially when arbitration is pending, unless criminal intent is clear, otherwise it constitutes an abuse of the legal process.

ORDER :

M. NAGAPRASANNA, J.

The petitioners/accused 1 to 5 and 7 are at the doors of this Court calling in question entire proceedings in C.C.No.10486 of 2023 registered for offences punishable under Sections 120B, 406, 409, 417, 420, 427, 506 and 34 of the Indian Penal Code and pending before the IV Additional Chief Metropolitan Magistrate, Bengaluru.

2. Sans details, facts germane are as follows: -

2.1. The petitioners/accused and the 2^nd respondent/ complainant entered into three separate Master Service Agreements (‘the Agreement’ for short) on 12-07-2019. The 5^th petitioner/Oyo Hotels and Homes Private Limited was earlier known as Alcott Town Planners Private limited. The agreement was entered into between Alcott Town Planners Private limited and the 2^nd respondent concerning three hotels. One of the hotels was M/s Jagadish hotel on Brigade Road. On 23-12-2018 a fire tragedy happens at the hotel. On 02-04-2019 a notice is issued by the Alcott Town Planners Private limited to the 2^nd respondent to provide requisite safety certificate and licences pertaining to the hotel at Brigade Road. Another notice was followed to cure the breach and let unhindered access to the kitchen and other small areas of the premises in terms of the agreement. On 01-06-2019, it appears certain internal restructuring and transfer of business happen in the Alcott Town Planners Private limited. Rights and obligations of the three agreements were transferred to Mypreferred Transformation and Hospitality Private Limited. The new entity comes into effect from 1-06-2019.

2.2. After the new entity comes over, a crime in Crime No.131 of 2019 comes to be registered by Oyo Hotels and Homes Private Limited against Jagadish and other partners alleging offences punishable under Sections 341, 342, 504, 506 and 34 of the IPC. Alcott Town Planners Private limited which was the earlier agreement holder files a petition under Section 9 of the Arbitration and Conciliation Act before the concerned Court against the complainant for causing constant obstruction in the business, notwithstanding the agreements between the parties. On 04-08-2019, a notice is issued invoking arbitration by the Alcott Town Planners Private limited and Justice A.V. Chandrashekar is appointed as an Arbitrator insofar as it concerns one of the hotels in the agreements. Likewise, several proceedings are instituted by the petitioners against the complainant or the complainant against the petitioners including a proceeding under the Insolvency and Bankruptcy Code, 2016 in relation to Jagadish Hotel.

2.3. During the pendency of these proceedings, the 2^nd respondent/complainant registers the subject complaint on 17-01-2023 for the aforementioned offences. The Police, after investigation, file a charge sheet before the concerned Court and the concerned Court registers C.C.No.10486 of 2023. After registration of crime, the subject petition comes to be preferred. During subsistence of the subject petition, identical complaints instituted by several persons against the petitioners, all arising out of certain agreements, come to be quashed. Those crimes being quashed have become final. The petitioners are before this Court now seeking quashment of entire criminal proceedings on the score that they are an abuse of the process of law.

3. Heard Sri Sandesh J. Chouta, learned senior counsel appearing for the petitioners, Sri B.N. Jagadeesha, learned Additional State Public Prosecutor appearing for respondent No.1 and Sri Prabhuling K. Navadgi, learned senior counsel appearing for respondent No.2.

4. The learned senior counsel Sri Sandesh J.Chouta appearing for the petitioners would vehemently contend that the case at hand is a classic illustration of a civil dispute being given a cloak of crime. The complaint is cleverly drafted with an ulterior motive. Therefore, it is his submission that this Court should go beyond the complaint and look into the conduct of the complainant. Similar cases instituted against these p