JUDGMENT :

1. Rule. Mr. Hardik Mehta, learned APP waives service of Rule on behalf of the respondent– State and Mr. Rituraj Meena, learned advocate waives service of Rule on behalf of the respondent no.2.

2. This application has been filed under Section 482 of the Code of Criminal Procedure, 1973 (hereinafter referred to as “Cr.P.C.”) for quashing the FIR bearing CR No.I-139/2016 registered with “A” Division Police Station, Junagadh for offences punishable under sections 406, 420, 120(B), 467, 468, 471 and 114 of IPC as well as Criminal Case no.1170 of 2017.

3. Mr. Nandish Thackar, learned advocate for the petitioners submits that pending the petition, the petitioners have accepted the OTS proposal in the NPA account of M/s. Rachana Seeds Industries Pvt. Ltd. and in accordance to the OTS scheme and after meeting and discussion with the higher authority, the Management Committee of the Bank, in the meeting held on 27.12.2018, had approved OTS for Rs.15 crores (plus ECGC claim of Rs.21.05 crore available for appropriation) against the Bank dues as on 30.9.2018 plus waiver of future interest and cost with effect from 1.10.2018 in full and final settlement of the NPA account on the terms and conditions as were agreed upon with the Punjab National Bank, whereby the loan for the development of the business was secured. Mr. Nandish Thacker submits that a prayer is made under Section 482 of the Cr.P.C. for quashing the FIR bearing CR no.I-139/2016 registered with “A” Division Police Station, Junagadh and further terminating Criminal Case no.1170 of 2017 submitting that there is no any criminality in the form of cheating or fraud with the Bank to invoke Sections 406, 420, 120B, 467, 468, 471 and 114 of the IPC against the petitioners since the petitioners had paid regular interest over the cash credit facilities from the respondent-Bank from the year 2001 and the petitioners were given cash credit facility after due diligence by the respondent–Bank, where equivalent securities were provided by the petitioners to the Bank. Mr. Thacker submits that forgery which is alleged is with regard to the discrepancy in the stock register and the physical stock and none of the documents disclose any forgery to satisfy the ingredients of Sections 463 and 464 of the IPC. Mr. Thacker further submits that because of financial crunch, the petitioners could not regularly maintain the stock and there had been occasional delay in paying the interest amount. Mr. Thacker relying upon the judgment in the case of Nikhil Merchant v. CBI, reported in (2008) 9 SCC 677 submits that when the Bank had settled with the petitioners by way of OTS offer and the settlement and the Sarfaesi action was also in abeyance under the supplementary agreement between the parties and the charge under security/title deeds were decided to be released on receipt of the entire OTS amount along with the interest, if any, it is stated that on account of compromise between the parties, he made a prayer for quashing the FIR contending that continuation of the criminal proceedings would be a futile exercise.

4. While countering the arguments, Mr. Meena submits that initial loan (cash credit limit of Rs.12,00,000/-) was granted by the respondent - Bank and thereafter, the limit was increased to the tune of approximately over Rs.50 crores which was given on condition that the petitioners were required to maintain certain degree of stock and to send details of stock every month between 1st day of month to 10th day of the month. Mr. Meena submits that on receiving the stock statement dated 31.8.2016 showing stock of Rs.55,81,09,816/-, the officer of the respondent - Bank visited the premises of the Company on 17.9.2016 and during the visit, to the shock and surprise of the officers of the Bank, there was high level of discrepancy between the stock statement given by the petitioners and the actual stocks and since no satisfactory response was received from the concerned officers of the Company, the