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2019 Supreme(Mad) 1557
IN THE HIGH COURT OF JUDICATURE AT MADRAS
G. JAYACHANDRAN, J.
Doraisamy and Ors.- Appellants
Versus
The State and Ors. – Respondents
Criminal Original Petition No. 10969 of 2017, Crl. M.P. No. 7221 of 2017 and Crl. M.P. No. 794 of 2018
Decided On : 03-04-2019
Advocate Appeared:
For the Appellant : Sunder Mohan
For the Respondents:Kritika Kamal P., Government Advocate and T. Saikrishnan
Headnote:
Criminal Procedure Code - Section 156(3) – Bank - Quashed through this Criminal Original Petition – First Information Report - Cheating and misappropriation - Machineries were hypothecated to the bank - Without permission of bank and Board of Directors petitioners have removal of machineries and got transferred vehicles in others name by 1st petitioner in connivance with other petitioners - A duster car, bus and goods van which were in name of Spinners (P) Ltd., was transferred to name of Mrs. and M/s. Sunrise Knitting Mills Ltd - Forgery been alleged in transferring vehicles owned by Spinners (P) Ltd. Further misappropriation of money received for job work also being alleged against petitioners - Thus, due to the fraudulent activities of the petitioners Company has lost its reputation and goodwill in business – Held, It is improper to chose one Company alone which was given to exclusively Management of petitioners as alleged in complaint though on record it is not so - It is pertinent to note that person who is holding shares in Company, making allegation against person who is holding shares - None other shareholders have not made any complaint and the bank which has advanced money has not restored to any action for alleged fraud - It is only respondent has made out some allegations of fraud cheating and misappropriation - Even assuming, there is material in his allegation, it is open for him to resort to the provisions of Companies Act-2013 and place before the Registrar of Companies or lodge a private complaint before Special Court as contemplated under Section 436 of he Companies Act complaint on file of respondent cannot be probed effectively since it involves intricate facts on accountancy and auditing. Except forensic audit conducted into the affairs of these Companies held by the 1st petitioner and the 2nd respondent, the truth will not come to light - Ultimately Financial Institutions which has lent money to these warring groups will be sufferer, which in turn will be loss to public. Therefore, in the interest of public also, the matter has to be referred to Registrar of Company to enquiry and proceed in accordance with law - Accordingly, while quashing the complaint in file of respondent police this Court directs Registrar of Companies to take note of complaint and cause inquiry not only the affairs Spinners Pvt. Ltd., but also all the other sister concern, in which petitioner respondent are involved and file its report to Central Government for further action - Petition is Allowed
ORDER :
G. Jayachandran, J.
1. The petitioners herein are shown as accused in the case registered by the 1st respondent police based on the complaint given by the 2nd respondent, alleging fraud, mis-appropriation, falsification of records and conspiracy. A private complaint under Section 156(3) of Cr.P.C. was presented before the Judicial Magistrate No. III, Coimbatore, same was referred to the 1st respondent by the Court to investigate and file final report. Accordingly, the 1st respondent has registered the complaint in Crime No. 29 of 2017 on 23.04.2017. The said complaint is sought to be quashed through this Criminal Original Petition.
2. Allegation made in the complaint. The complainant Mr. C. Subramaniam claiming himself as one of the Director of M/s. M.C. Spinners Pvt. Ltd., in his complaint has stated that he and his family members are holders of 50% shares in the said company. Rest of the shares are owned by Mr. R. Doraisamy/1st petitioner, Mrs. Dhanalakshmi/3rd petitioner and their family members to an extent of 25.67%. One Mr. Venkatachalam is holding 9.66% of shares and Mr. Sivaram is holding 14.67% of the shares. The said company was incorporated in the year 2011-2012. The administration of the company was left to the 1st petitioner/Mr. R. Doraisamy who is one of the Directors of the company, from the year 2014. Thereafter, Mr. C. Subramaniam, has indulged in maladministration of the company. Taking advantage of the fact that other Directors are busy involved in their personal business, the 1st petitioner in connivance with the 2nd petitioner/Mr. Ramaraj, Financial Officer, Mr. Dhanalakshmi/3rd petitioner and son-in-law petitioners 4 to 6 have indulged in forgery, criminal breach of trust and cheating. Only when State Bank of India, Commercial Branch, Coimbatore informed the complainant and others Directors about the non-payment of loan, they came to know about the offence committed by the petitioners. It is alleged in the complaint that the fabric stocks worth about Rs. 8,32,14,000/- hypothecated to the State Bank of India was removed by the petitioners between 2014 to November 2016, without the knowledge and permission of the bank and other Directors. Based on the said hypotheca, the Bank had advanced Cash Credit Loan Facilities to a tune of Rs. 15 crores. By stealthy removing the hypothecated goods, the petitioners have committed breach of trust. Various machineries of M/s. M.C. Spinners Pvt. Ltd. worth about Rs. 1,89,15,625/- was removed from the mill premises. The Auto Corner machines and 2 numbers of carding machines worth about Rs. 1,33,52,888/- were removed by the petitioners and installed in the premises of M/s. Vigneshkumar Spinners (P) Ltd., Palladam owned by Shanmugavadivel/5th petitioner herein. The Transformer worth Rs. 17 Lakhs removed from the mill premises and installed in the premises of M/s. Sunrise Knitting Mills (P) Ltd. owned by Mr. R. Mahesh/4th petitioner and Mr. Shanmugavadivel/5th respondent. The machineries were hypothecated to the bank. Without the permission of the bank and the Board of Directors, petitioners have removal of machineries and got transferred vehicles in others name by the 1st petitioner in connivance with other petitioners. A duster car, Eicher bus and Eicher goods van which were in the name of M/s. M.C. Spinners (P) Ltd., was transferred to the name of Mrs. Dhanalakshmi and M/s. Sunrise Knitting Mills (P) Ltd. Forgery been alleged in transferring the vehicles owned by M/s. M.C. Spinners (P) Ltd. Further, misappropriation of money received for the job work also being alleged against the petitioners. Thus, due to the fraudulent activities of the petitioners, the Company has lost its reputation and goodwill in the business.
3. By calculative manner, the petitioners have conspired and committed offence of cheating, forgery, causing loss to the complaint and other Directors to a sum of Rs. 18 crores. Since, his complaint to the Inspector of Police, Siruvalur Police Station, Gopi
