Important Point - Magistrate did not apply his mind to the complaint for deciding whether or not there is sufficient ground for proceeding but only for ordering an investigation under s.156(3).

A.S. OKA, J.

1. By this Petition under Article 226 of the Constitution of India read with Section 482 of the Code of Criminal Procedure, 1973 (for short “Cr.P.C”), a prayer is made for quashing the order dated 23rd December, 2013 passed by the learned Additional Metropolitan Magistrate, 47th Court, Esplanade, Mumbai on a complaint filed by the second respondent. By the said order, action under Section 156(3) of the Cr. P.C was ordered to be taken. There is also a prayer for quashing the First Information Report (FIR) registered with MRA Marg Police Station for the offence punishable under Section 409 read with Section 34 of the Indian Penal Code registered on the basis of the impugned order. On 5th February, 2015, Rule was issued and after hearing the learned counsel appearing for the second respondent and the learned APP. An interim order was passed directing that charge sheet shall not be filed without leave of this Court and that no coercive action shall be taken against the petitioners. However, investigation was ordered to be continued. We may note here that on 4th November, 2015 an order was passed by the Additional Chief Metropolitan Magistrate, 38th Court, Ballard Pier, Mumbai which reads thus :

“ORDER BELOW EXH.1 IN NOTICE NO.40/2015

As I am passing this order just below this notice itself, I need not reproduce its contents.

(2) Perused the petition and the documents along with. Issue notice to the Investigating Officer that, if the offences of forgery as contended in this notice application are made out, he may take appropriate action in accordance with the provisions of law, in the course of his investigation, and do the needful.”

2. By order dated 16th December, 2015 this Court permitted amendment to be carried out for incorporating a reference to the aforesaid order and accordingly, amendment has been carried out.

3. The second respondent in his complaint stated that he was a Director of a Company SIYA Financial Services Pvt. Ltd. The said company was engaged in the business of trading and investment of shares. In the complaint it was alleged that the first petitioner Company was formerly known as M/s. Nirmal Bang and the second and third petitioners are the Directors of the first petitioner – Company. It is alleged that the first petitioner – Company is engaged in the business of share trading and is a registered broker of NSE and BSE. The allegation is that in the year 1995, the second and third petitioners along with their deceased brother Nirmal Bang had approached the second respondent and requested him to invest in shares and do trading through them. They represented to the second respondent that they were registered brokers of NSE and BSE and it was represented that it would be profitable for the second respondent to get associated with them. On the basis of the representations made by the second and third petitioners and their deceased brother (Nirmal Bang), the second respondent agreed to invest. According to the case made out in the complaint, the second respondent started investing from the year 1995 and numerous transactions in huge amounts running into Crores of rupees were made. It is alleged that the second and third petitioners along with their brother Nirmal Bang were also the Directors of Bama Securities Limited. The said Company was also trading in shares. Reliance is placed on contract notes which are annexed to the complaint by way of illustration. It is alleged that on 26th February, 1998 the petitioners had bought on behalf of the second respondent, 1,09,700 shares of BFL Software at the rate of Rs.86/. A copy of the statement of the said transaction has been annexed as Exhibit – B to the complaint. The second respondent relied upon an entry dated 30th June, 1998 which shows the purchase of 1,09,700 shares of BFL Software on 26th February, 1998. It is alleged that in addition to the aforesaid shares, the petitioners were holding other shares on behalf of the second respondent. Details of