Criminal proceedings are not a mechanism for debt recovery; once the accused deposits the disputed principal amount for the benefit of stakeholders, continuing criminal litigation for a civil liability is unwarranted, justifying the quashing of an FIR.

COMMON ORDER

1.All these petitions have been filed challenging the impugned FIR in Cr.No.1 of 2025 registered for the offences under Sections 406 and 420 of the IPC, Section 5 of the Tamil Nadu Protection of Interest of Depositors (In Financial Establishments) Act, 1997 [in short, 'the TNPID Act'] and Sections 21(1), 21(2), 21(3) and 23 of the Banning of Unregulated Deposit Schemes Act, 2019 [in short, 'the BUDS Act].

2. The gist of the allegations in the impugned FIR is

(i) that the defacto complainant was an employee of a Company by the name 'Shri Ramalinga Mills Private Limited' [in short, 'the Company'], which was managed by the late Mr.T.R.Dinakaran; that after the retirement of the defacto complainant from the said Mills, he had deposited a portion of his retirement benefits in the Company and the late Mr.T.R.Dinakaran had been paying a high rate of interest regularly; that initially the deposit receipt was issued in the name of the Company; that thereafter, the deposit was changed into the individual name of the late Mr.T.R.Dinakaran;

(ii) that until the said Mr.T.R.Dinakaran passed away on 19.12.2022, the defacto complainant and the other depositors were receiving interest regularly; that the defacto complainant came across the Will executed by the late Mr.T.R.Dinakaran dated 31.12.2021, wherein the private properties of the late Mr.T.R.Dinakaran were bequeathed in favour of his daughter one Kothai (the petitioner in Crl.OP.(MD) No. 10221 of 2025); that the said Kothai (A5) had paid interest after the death of the Mr.T.R.Dinakaran for a period of four months and later stopped paying the interest, stating that the Company is liable to pay the interest and the principal;

(iii) that when the defacto complainant approached the Company and its Whole-Time Director one Mr.Senthil Kumar (A4), who is the son of the late Mr.T.R.Dinakaran [the petitioner in Crl.OP.(MD) No.6726 of 2025], he had informed that the money would be settled only after all the issues amongst the legal heirs of late Mr.T.R.Dinakaran is resolved before the National Company Law Appellate Tribunal [in short, 'the NCLAT']; that since the Company and its Directors and other accused are evading payment of interest and the principal amount, the petitioners are liable for the aforesaid offences.

3.(i) Mr.A.Ramesh, learned Senior counsel appearing for A1-Company [Crl.OP.MD.No.2411 of 2025], its Managing Director, A4- Mr.Senthil Kumar [Crl.OP.MD.No.6726 of 2025] and A7-Narayanasamy [petitioner in Crl.OP.MD.No.6727 of 2025], submitted that none of the offences alleged would be made as against those three petitioners; that A5-Kothai, the daughter of Mr.T.R.Dinakaran had acquired all the private properties of Mr.T.R.Dinakaran by way of a Will; that there are disputes between the legal heirs of the Mr.T.R.Dinakaran and a case is currently pending before the NCLAT; that the petitioners had not made any false representation or deceived the depositors; that even according to the allegations in the FIR, the deposits were changed in the name of Mr.T.R.Dinakaran and hence, the Company or its Whole Time Director, would not be liable; that since there is no entrustment, the offence under Section 406 of the IPC would not be made out; that in any case, it is well settled that Sections 406 and 420 of the IPC would not go together on the same set of allegations; that the impugned FIR has been lodged only to recover money; that the provisions of the TNPID Act would not be attracted since the Company was never a fina