THE HONOURABLE SMT. JUSTICE K. SUJANA CRIMINAL REVISION CASE No.147 of 2025

ORDER:

This Criminal Revision Case is filed seeking to quash the proceedings against the petitioners in C.C.No.45 of 2019, on the file of the learned I Additional District Judge, Ranga Reddy District at L.B. Nagar, Hyderabad, and consequently to set aside the order dated 16.12.2024 passed in Crl.M.P.No.1136 of 2024 in the said case. The proceedings were registered for offences punishable under Sections 406, 420, and 506 read with Section 34 of the Indian Penal Code, 1860 (for short, ‘IPC’), Section 5 of the Andhra Pradesh Protection of Depositors of Financial Establishments Act (APPDFEA), and Sections 4 and 5 of the Prize Chits and Money Circulation Schemes (Banning) Act (PC and MCSBA).

2. The brief facts of the case are that in C.C.No.45 of 2019, accused Nos.6 to 9 filed an application under Section 227 of Cr.P.C. seeking discharge, contending that there is no material against them and the dispute is civil in nature. The case of the prosecution alleges that accused No.1 conducted unauthorized chit fund and finance business, collecting deposits from the public without permission, and misappropriated nearly Rs.15 crores. Accused No.1 allegedly diverted these funds for purchasing properties in the names of his close relatives, including the petitioners, who are family members. It was further alleged that all the accused had knowledge and participated in the said illegal business. While the case against accused No.8 was quashed by this High Court, similar petitions filed by accused Nos.6, 7, and 9 were dismissed, observing that there is prima facie material showing their knowledge and involvement. The police filed a counter reiterating the allegations and opposing the discharge. 3. The trial Court, after hearing both parties, vide order dated 16.12.2024 dismissed the petition holding that at the stage of framing charges, only a prima facie case is to be seen and a detailed examination of evidence is not permissible. The trial Court noted that documents indicate the petitioners received or held properties allegedly purchased from the proceeds of the crime and their connection to the main accused and the alleged fraudulent activity warrants framing of charges. The trial Court relied on settled legal principles that discharge is warranted only where there is no material at all, which is not the case here. Aggrieved thereby, the petitioners/accused Nos.6, 7 and 9 filed the present criminal revision case.

4. Heard Sri A.P. Suresh Ram, learned counsel appearing on behalf of the petitioners as well as Sri M. Vivekananda Reddy, learned Assistant Public Prosecutor appearing on behalf of respondent No.1 - State and Sri Dida Vijay Kumar, learned counsel appearing on behalf of respondent No.2.

5. Learned counsel for the petitioners submitted that the impugned order passed by the trial Court is contrary to law, the weight of evidence, and the facts of the case, and is in gross violation of the principles of natural justice and that the trial Court erred in dismissing the discharge petition despite the absence of any material or document in the charge sheet that could establish a prima facie case against the petitioners. A plain reading of the witness statements and documents reveals no specific allegation or incriminating evidence directly linking the petitioners to the alleged offence. The trial Court failed to distinguish between mere suspicion and grave suspicion, a distinction vital under settled criminal jurisprudence, thereby allowing the case to proceed on a significantly lower threshold than legally permissible.

6. Learned counsel for the petitioners further submitted that there exists no nexus or criminal intent on the part of the petitioners, and none of the documents relied upon by the prosecution bear their names or attribute any direct role in the alleged acts and that the trial Court ignored the fact that the this Court has already quashed proceedings agai