Back
Issues Notice on Rishabh Telang's Petition to FIR
The on Tuesday issued notice on a petition filed by co-founder Rishabh Telang, seeking to an FIR registered against him by the . The FIR, lodged on , includes allegations of , , , and . The complainant, Deepak Poduval—Telang’s brother-in-law and former business associate—alleges that documents relating to the takeover of and its subsequent striking off were forged.
Justice M. Nagaprasanna, presiding over the single bench, directed notices to the and Deepak Poduval. The matter has been listed for further hearing on . The Court noted that only a notice under has been issued to Telang and that there is no apprehension of his arrest at present. However, the Court did not stay the investigation and issued to both respondents.
High Court Takes Up Telang's Quashing Plea
Rishabh Telang, represented by , argued that the complaint was filed nearly a decade after the alleged events, despite Poduval having full knowledge of the transactions. According to Telang’s case, took over the business of between 2016 and 2019, and Cult Fitness was eventually struck off on . Telang maintains that all transactions were conducted with Poduval’s and that Poduval received approximately ₹1 crore as .
“R2 says that took over Cult Fitness Pvt. Ltd. in 2016, eventually Cult Fitness was struck off on 18.05.2019. According to R2, these events happened without his knowledge...after 10 years he files a complaint,” Chouta submitted to the Court. He further asserted that Poduval had held 20% equity in Cult Fitness and had consented to the transfer of trademarks to the new company.
Allegations of and Delayed Complaint
The genesis of the dispute lies in the takeover of , a company co-founded by Telang and Poduval. According to the FIR, Poduval alleges that his signatures were fabricated on company documents, enabling the transfer of Cult Fitness’s business to and the subsequent striking off of the original entity. The complaint, filed nearly 10 years after the takeover began, has been met with the defence of and .
Poduval’s allegations are broad: , , , and . The FIR was registered by the on , based on a complaint that paints the takeover as a fraudulent scheme orchestrated by Telang. However, Telang’s legal team argues that the dispute is essentially a commercial disagreement that has been inflated into a criminal case.
Defence: and
A key plank of Telang’s defence is that Poduval not only consented to the transactions but also received substantial . Senior Counsel Chouta told the Court that Poduval signed assignment deeds in , accompanied by , and that those deeds contained arbitration clauses for dispute resolution.
“He had no objection to trademarks going to new company. He receives a sum of 1 crore. In , he signs assignment deeds which was accompanied with , and there are arbitration clauses in case of dispute,” Chouta submitted. This, Telang argues, undermines any claim of or lack of .
The Court, after hearing initial arguments, decided to issue notice rather than grant immediate relief. Significantly, the Court did not stay the investigation, indicating that the quashing petition will require a full hearing. The suggests the Court wants the respondents to respond promptly, given the commercial context and the impending IPO of .
Court's Observation on Arrest
One notable aspect of the proceeding was the Court’s observation regarding Telang’s arrest risk. The bench noted that only a notice under Section 35 of the BNSS (which corresponds to ) had been issued to Telang. Such a notice typically requires the person to appear before the investigating officer but does not involve immediate arrest. The Court remarked that there was no apprehension of arrest at present, which may provide some relief to the petitioner, who is a high-profile corporate figure.
However, the absence of a stay on investigation means that the police can continue probing the allegations. If the investigating officer later finds sufficient grounds, an arrest could still be made. The Court’s decision to refrain from staying the investigation reflects a cautious approach, balancing the petitioner’s right to a fair process with the complainant’s right to pursue the allegations.
Broader Implications for Corporate Takeover Disputes
This case serves as a cautionary tale for founders and investors in closely held companies. Disputes over share transfers, asset acquisitions, and trademark assignments can easily escalate into criminal complaints years after the transactions are completed. The in filing the FIR—nearly a decade—raises questions about the viability of the allegations, especially when the complainant allegedly participated in and benefited from the transactions.
For legal practitioners, the case highlights the importance of meticulous documentation and explicit clauses in corporate restructuring. The presence of arbitration agreements in the assignment deeds could be a significant factor in the quashing petition, as courts often view such clauses as evidence of a rather than a criminal one.
Moreover, the timing of the petition—shortly after filed draft papers for its initial public offering (IPO)—adds a layer of complexity. Any adverse criminal proceedings against a co-founder could potentially impact the company’s reputation and regulatory filings. The outcome of this quashing petition will therefore be closely watched by the corporate law community and investors.
Legal Analysis: Grounds for Quashing
Under the BNSS, a petition to an FIR is governed by (which is analogous to Section 482 CrPC). The High Court can exercise its to prevent abuse of the process of law or to secure the ends of justice. In this case, Telang’s counsel is likely to argue that the FIR is an because:
- : The complaint was filed after an inordinate of 10 years, during which Poduval had knowledge of the transactions and never objected.
- : Poduval signed assignment deeds and accepted , indicating his voluntary participation.
- : The dispute involves breach of contract, share transfers, and trademark assignments—essentially civil matters that do not warrant criminal prosecution.
- : The existence of an arbitration agreement suggests that the parties intended to resolve disputes through private means, not criminal courts.
The Court will need to assess whether the allegations, even if taken at face value, constitute criminal offences. The Supreme Court has repeatedly held that a criminal complaint should not be entertained when the dispute is purely civil in nature and lacks criminal intent. If the Court finds that Poduval’s was genuine and that he received , the allegations may appear tenuous.
Impact on Legal Practice and the Justice System
This case is emblematic of a growing trend where business disputes are weaponized through criminal complaints. Legal professionals advising corporate clients must be aware of the risks of delayed complaints and the potential for misuse of criminal law. The case also underscores the importance of documenting all stages of a corporate transaction, especially when family members or close associates are involved.
For the , this petition will test the boundaries of Section 35 BNSS and the court’s willingness to intervene in ongoing investigations. The fact that the Court did not stay the investigation suggests that it is not yet convinced of the merits of quashing, but the notice stage is merely preliminary.
Conclusion
Rishabh Telang’s petition to the and FIR will be heard further on . The ’s decision to issue notice without staying the investigation leaves the matter open. Meanwhile, the allegations of fabricated signatures and will be investigated by the . For the legal community, this case offers a valuable precedent on the interplay between corporate disputes and criminal law, and the Court’s eventual ruling will likely influence similar quashing petitions across the country.
As moves forward with its IPO, the resolution of this criminal complaint—whether through quashing or trial—will be a key factor in its corporate governance narrative. The coming months will reveal whether the High Court finds merit in Telang’s arguments of and , or whether it allows the investigation to proceed to its logical end.
