The court emphasized that allegations of fraudulent financial transactions satisfy the essential ingredients for criminal liability under IPC Section 420, and cannot be dismissed as merely civil disputes.

ORDER:

J. SREENIVAS RAO, J.

This Criminal Petition has been filed under Section 482 of the Code of Criminal Procedure, 1973, by the petitioner/accused No.1 seeking to quash the proceedings in C.C.No.11868 of 2021 on the file of the XII Additional Metropolitan Magistrate, Nampally, Hyderabad, for the offence under Section 420 of the Indian Penal Code, 1860 (for short, ‘the IPC ’).

2. Brief facts of the case:

On 17.04.2021 at about 15:00 hours, Respondent No. 2 filed a complaint, wherein he stated that his firm undertakes government civil contract works and that, in the course of business, the Directors of M/s Dhruthi Infra Projects Limited, including the petitioner along with accused Nos.2 and 3, who were directors of the firm and responsible for the in day-to-day affairs, approached him between May 2015 and April 2017 and obtained a hand loan of Rs. 14,20,00,000/-. They agreed to repay Rs. 12,00,00,000/- with 24% interest per annum and clear the remaining Rs. 2,20,00,000/- within a short period. However, they failed to honour these commitments for several years. At that stage, respondent No.2 filed C.C.Nos.235 of 2018 and 304 of 2019. Thereafter, the petitioner and the other accused requested withdrawal of those cases and agreed to pay the amounts and executed (Memorandum of Understanding) MoU on 13.02.2020 and they given D.D. for Rs.1,00,00,000/- and they issued post-dated cheques for Rs.11,00,00,000/-. When the said cheques were presented, the same were returned with an endorsement “account blocked situation covered in 2125” and the petitioner did not respond to the statutory notice issued by him and he further stated that the petitioner had dishonestly issued cheques and misused the amount of Rs.8,35,90,000/-. He also stated that on each and every stage, there is dishonest intention on the part of the petitioner and other accused. Based on the said complaint, Crime No. 73/2021 was registered on 17.04.2021 under Section 420 read with Section 34 IPC, and the Investigating Officer after conducting investigation filed final report and the learned XII Additional Metropolitan Magistrate, Nampally, Hyderabad, has taken cognizance and issued summons to the petitioner and other accused in C.C.No.11868 of 2021. Hence, the petitioner filed this criminal petition.

3. Heard Mr. G. Veera Babu, learned for the petitioner, Mr. G. Vasantha Rayudu, learned counsel for respondent No.2, and Mr. M. Vivekananda Reddy, learned Assistant Public Prosecutor appearing for respondent No.1-State.

4. Submissions of learned counsel for the petitioner:

4.1. Learned counsel submitted that the petitioner has not committed the offence and he was falsely implicated in the present case. The allegations made in the complaint and the final report are purely civil in nature as it is for recovery of the amount and the ingredients for the offence under Section 420 of the IPC do not attract.

4.2. He further submitted that with respect to the very same allegations, respondent No.2 had already filed complaints, namely STC.NI.Nos. 284, 285, 290 and 295 of 2021, which are pending on the file of the VIII Metropolitan Magistrate, Nampally, Hyderabad, for the offence under Section 138 of the Negotiable Instruments Act, 1881 (for short, ‘the NI Act’). Respondent No.2 ought to have include the offence under Section 420 of the IPC , while filing the cases under Section 138 of the NI Act, on the other hand, he filed the present complaint for the offence under Section 420 of the IPC , which amounts to double jeopardy, and the same is not permissible under law as per the provisions of Section 300 of the Cr.P.C .

4.3. He further submitted that there are no specific allegati