IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/CRIMINAL MISC.APPLICATION (FOR QUASHING & SET ASIDE FIR/ORDER) NO. 2155 of 2022 ==========================================================

MAYURBHAI HARSUKHBHAI GUSANI Versus STATE OF GUJARAT & ANR.

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Appearance:

MR PREMAL S RACHH(3297) for the Applicant(s) No. 1 NOTICE SERVED for the Respondent(s) No. 2 MR HK PATEL, APP for the Respondent(s) No. 1 ==========================================================

CORAM:HONOURABLE MR. JUSTICE HASMUKH D. SUTHAR Date : 02/09/2024

ORAL ORDER

1. RULE. Learned APP waives service of notice of rule for the respondent-State. Though served, none appears for respondent no.2.

2. Considering the facts and circumstances of the case and with consent of learned advocate for the respective parties, matter is taken up for final disposal forthwith.

3. By way of this application under Section 482 of the Code of Criminal Procedure, 1973 (hereinafter referred to as “Cr.P.C.”), the applicant has prayed to quash and set aside the complaint being FIR C.R. No. 11202009201601 of 2020 with City 'B' Division Police Station, Jamnagar for the offences punishable under Sections 406 & 420 of IPC as well as Sections 13, 16, 17, 19, 23(1) (b), (c),(e) & (f) of The Securities Contract (Regulation)

Act, 1956 and all the consequential proceedings arising therefrom.

4. The facts of the case are that on 22.10.2020, respondent No.2, PSI, based on information received by a police officer while patrolling an area in Jamnagar City along with other police officers, raided the shop of accused No.3. The accused persons were trading in securities without a license or permission and without entering into a contract with SEBI, in violation of the provisions of the Act. It is further alleged that during the raid, the police found accused Nos.1 to 3 at the scene of the offense, along with documents and other materials such as a computer, register, etc., as stated in the FIR. It is also alleged that during the raid, the police discovered certain computer printouts containing codenames of accused Nos.7 to 11, which led to the filing of the present impugned complaint.

5. Learned advocate for the applicant submits that the applicant has nothing to do with the offence and he is falsely implicated in it. Upon submission of charge sheet, the Ld. Magistrate committed the case to the Sessions Court, Jamnagar since the offences punishable under the provisions of the Act are triable by the Sessions Court. Pursuant thereto, Sessions Case No.113/2021 came to be registered and the same is pending at the stage of framing of charge in the Court of Ld. 3rd Additional District Judge, Jamnagar.

5.1 It is submitted that there is a specific bar contained in Section 26 of the Act, and the Court could not have taken cognizance based on a police report in view of this bar. In the present case, in the absence of a complaint in writing filed before the appropriate court, the lower court took cognizance of the alleged offenses based on a police report, which is clearly in contravention of the provisions of Section 26. Therefore, the entire proceedings are illegal and liable to be quashed. It is further submitted that the allegations leveled against the present petitioner are far from the truth and do not constitute criminal breach of trust. In light of Section 26 of the Act, the lower court ought not to have taken cognizance of the offenses based on a police report. Therefore, the application may be allowed.

6. Learned APP has strongly opposed the present application and submits that the accused persons were engaging in trading in securities without a license or permission and without entering into a contract with SEBI, in violation of the provisions of the Act. During the raid, the police found accused persons at the scene of the offense, along with documents and other materials such as a computer, register, etc., as stated in the FIR. During the raid, the police discovere