The main legal point established in the judgment is that criminal proceedings cannot be a cloak for settling civil disputes, and the court can quash proceedings if they are found to be an abuse of the court process.

ORDER :

The Nehru Trophy Boat Race is an annual event held in the backwaters at Punnamada in Alappuzha. The event has received international acclaim with thousands thronging every year to witness the boat race. The event transforms the otherwise idyllic lake into an arena of activities bordering on festivity. The euphoria surrounding a boat race is difficult to describe but is to be experienced.

2. Organising the Nehru Trophy Boat Race is a herculean task. A society by the name 'Nehru Trophy Boat Race Society' (for short ‘the Society’) has been constituted, with the District Collector of Alappuzha as its Chairman and the Revenue Divisional Officer as its Member Secretary. Two civil servants occupying the above positions in 2012 are facing indictment for the offences under sections 406, 418, 463, 471, 420 and 120(b) r/w section 34 of the Indian Penal Code, 1860, along with the Society. The allegations are in connection with the boat race event held on 11.08.2012. Cognizance was taken of the above-referred offences on the basis of a private complaint filed by the first respondent, disregarding the claim of the accused of the need for sanction to prosecute them. The proceedings against the petitioners are challenged in these petitions under section 482 of the Code of Criminal Procedure, 1973.

3. Petitioners in Crl. M.C. No.7268/2014 are the Society and the then Revenue Divisional Officer of Alappuzha while the petitioner in Crl. M.C. No.7267/2014 was the then District Collector of Alappuzha. In fact the District Collector was only holding the charge of the District for the period from 30.06.2012 to 18.09.2012. The Society consists of various representatives of people like MLAs, MPs, Sports Council, Bar Association, Press Club, Representatives from the Municipalities and Panchayats and other nominees from different walks of life apart from presidents of social organisations like the Rotary and the Lions Club.

4. As the event incurs huge expenditure, the Society invites sponsors every year. In 2011, a company named PACL sponsored the event, and the first respondent who brought in the sponsor was paid a service charge for arranging such a sponsor. For the year 2012, offers were invited from sponsors and in a meeting of the executive committee of the Society, it was decided that the first respondent would be given a 10% commission if it brought sponsorship upto Rs.4 Crores and 25% of the amount which exceeds Rs.4 Crores brought in as sponsorship.

5. An agreement was executed between the Society and the first respondent on 24.07.2012, granting exclusive marketing rights for the boat race for that year. The agreement stipulated inter alia that the Society would also be at liberty to market the rights themselves. The terms of the agreement stipulated that sponsors procured by the first respondent must execute an agreement with it, and the revenue sharing model stipulated that the first respondent will raise an amount of Rs. 4 Crores and above, for which service charges will be paid as stipulated therein.

6. Subsequent to the execution of the agreement, PACL, the company which had sponsored the event in the preceding year, agreed to sponsor the event and transferred Rs.4 Crores in two parts. Alleging that the sponsorship obtained from PACL, the sponsor, was not at the behest of the first respondent, who had never executed any agreement with the sponsor, the society refused to pay the service charges as stipulated in the agreement. Due to the failure to pay the service charges as per the agreement, the first respondent lodged a private complaint on 01.01.2014, and the learned Magistrate took cognizance of the offences on 26.02.2014.

7. According to the complainant, the accused forged an agreement dated 10.07.2012 to make it believe that it was executed by the accused and PACL and accepted the sponsorship from PACL for an amount of Rs. 4 Crores for the Nehru Trophy Boat Race for the year 2012 with the dishonest intention to cheat the complainant