The central legal point established in the judgment is the discouragement of settling civil claims through criminal prosecution and the recognition of civil and contractual disputes.

ORDER :

1. The applicant, by way of this application, filed under Section 439 of the Code of Criminal Procedure, seeks regular bail in connection with the FIR being I-C.R. No. 9 of 2022 registered with CID Crime, Gandhinagar Police Station of Economic Offences Wing, for the offences punishable under Sections 406, 409, 420, 467, 468, 471, 477A, 120B of IPC.

2. Brief facts leading to filing of present application are that, the complainant Shashinbhai Patel being a Director of Sadbhav Engineering Ltd. lodged an FIR against seven persons. The accused No. 7 is Gayi Adi Management Trade Pvt. Ltd. Hyderabad. The applicant accused is the Director of accused No. 7 company. The FIR came to be lodged on 23.08.2022. The complainant availed loan from accused No. 7 M/s. Gayi Adi Management Pvt. Ltd. Company and as per the arrangement/understanding, the loan was extended to the tune of Rs. 6 crore, against which the borrower-complainant had to transfer /securitized 3183300 shares of M/s. Sadbhav Engineering Ltd. as a collateral against the loan amount and the same was reduced in writing. The transactions entered into writing in the month of January, 2020. It is further case of the prosecution that, the accused GSV Securities Pvt. Ltd. was the instrumental in the alleged loan contract, as the company is broking company. It is the case of the prosecution that, the complainant had transferred the disputed shares in the demat account, opened with GSV Securities Pvt. Ltd and simultaneously, loan of Rs. 6 crore was being sanctioned by the accused No. 7 company. It is alleged that, the demat account opened with GSV Securities Pvt. Ltd. was fraudulently without any authority, was misused by the accused No. 7 and with the forged signature of the complainant, the disputed shares were sold off by accused No. 7 to make profit, have committed the offence of cheating, criminal breach of trust and forgery for the purpose of cheating and created a false account to defraud the complainant.

3. In the aforesaid facts, the FIR came to be registered with EOW, CID Crime, Gandhinagar. The applicant herein has been arrested from his house at Hyderabad on 25.08.2022. He moved an application under Section 439 of Cr.P.C. before the City Sessions Court, Ahmedabad, which came to be rejected vide order dated 13.09.2022. Being aggrieved by the said order, the applicant has approached this Court by present bail application.

4. This Court has heard learned Senior counsel Mr. Sanjay Hegde assisted by Mr. Kunal Shah, Randhir Kumar and Anik E. Shaikh, ld. counsel appearing for and on behalf of the applicant accused, learned counsel Mr. Keyur Vyas, appearing for and on behalf of the original informant and learned APP Mrs. Krina Calla, for the State respondent.

5. Learned Senior counsel for the applicant Mr. Sanjay Hegde submits that, the FIR arising out of purely civil and contractual dispute between two companies and therefore, the action on the part of the complainant is nothing, but an arm twisting exercise for negotiation which clearly established that he has misused the State machinery to fulfill his ulterior motive. It is in this context, learned Senior Counsel submits that, the complainant had requested for loan from accused No. 7 company. Pursuant to the same, understanding was also reduced into writing having certain terms and conditions. The loan of Rs. 6 crore by the lender company accused No. 7 was sanctioned to the complainant borrower company against which shares of Sadbhav Engineering Ltd. was transferred as a collateral securities and as per the agreement, the complainant opened his demat account and the complainant had provided signed DIS slips to lender company as a collateral against the loan advanced and assured that, the borrower company will repay the amount along with interest as per the understanding. However, the complainant failed to maintain value of collateral and also failed to repay the interest and principal amount and did not transfer the additional s