Rebala Kishore Kumar Reddy And Another vs State Of Telangana

This Criminal Petition is filed to quash the proceedings against the petitioners/A1 and A2 in FIR No.198 of 2020 on the file of SHO, CCS, Hyderabad.

The petitioners are questioning the registration of crime for the offences under Sections 406 and 420 IPC by the CCS, Hyderabad mainly on the ground that though the civil proceedings were pending between the parties since the year 2009 regarding the property in question, the police erred in registering the crime after the 2nd respondent lost civil litigation right up to the Supreme Court.

The case of the 2nd respondent is that the petitioners herein, who are A1 and A2 and 7 others were responsible for cheating and committing misappropriation. The 2nd respondent and his family members executed GPA in favour of 1st petitioner herein on 27.03.2006. The 1st petitioner introduced A3 as the Chairman and Managing Director of Trend Set Builders Private Limited for development of 16,660 sq.yds of the property of the 2nd respondent. The petitioners herein obtained signatures of the 2nd respondent and his brother on blank cheques stating that they were necessary for approvals in Government Departments. However, first petitioner opened an account in South Indian Bank and maintained transactions from 2006 to 2010 in collusion with A3. The petitioners and other family members also opened account in Karur Vysya Bank and obtained Demand Draft worth Rs.1,00,80,000/-stating that they would deduct the said amount from the sale price. Since the said amount of Rs.1,00,80,000/- was deducted from their accounts, when questioned, the 1st petitioner issued 15 cheques. However, the said cheques issued by the 1st petitioner were returned unpaid. When the said dishonor of cheques was questioned, the 1st petitioner requested the 2nd respondent and his family members not to present remaining cheques and entered into MOU dated 07.11.2009 stating that construction would be completed within three years in 16,660 sq.yds. Thereafter, the 1st petitioner entered into agreement with A3 without their knowledge and received an amount of Rs.6.50 Crores. Since disputes arose with respect to the property, the parties approached the civil courts, High Court and Supreme Court.

On the basis of the said complaint that the 2nd respondent and family members have been cheated in respect of the property, criminal action was initiated and accordingly, present FIR was registered.

Learned counsel appearing for the petitioners would submit that the 2nd respondent having lost his claim before the Hon’ble Supreme Court in SLP Civil No.17457 of 2016 dated 11.04.2018 has filed the complaint only to coerce the petitioners and others into settling civil dispute. There are several civil disputes that are filed with regard to the said property and the parties have been pursuing with the said disputes in the Civil Court. For the said reason of the allegations in the complaint being civil in nature, FIR has to be quashed.

On the other hand, learned counsel for the 2nd respondent would not dispute that there are civil disputes among the parties. However, in the order dated 26.11.2015 of the XIV Additional Chief Judge, City Civil Court in Arb.O.P.No.2739 of 2013, the court found that the 1st petitioner herein, who is the 2nd respondent therein did not file any material to prove that payment of sale consideration was made and in fact different plea was taken by the 1st petitioner herein stating that Rs.8.00 Crores were paid to the 2nd respondent’s family. There is inconsistecy with respect to the plea taken by the 1st petitioner herein. Further, the Civil Court did not believe that 1st petitioner and others made payment of Rs.8.00 Crores to the 2nd respondent family.

He relied on the judgment in the case of State of Telangana v. Habib Abdullah Jeelani (2017) 2 Supreme Court Cases 779 in which, the Hon’ble Supreme Court held that at the time of registration of crime, the genuineness or otherwise of the information mentioned in the complaint is not relevant. He also relied on the judgment reported in the case of Suraj Lamp and Industries Private Limited v. State of Haryana (2012) 1 Supreme court Cases 656) and argued that power of attorney is not an instrument of transfer with regard to any right, title or interest on the immovable property. The said power is revocable and could be terminated.

He also relied upon the judgment in the case of HMT Watches Limited v. M.A.Abida and another (2015) 11 Supreme Court Cases 776) and argued that the High Court under inherent powers under Section 482 Cr.P.C cannot decide the cases on the basis of disputed questions of fact.

Further in the case of Vinod Raghuvanshi v. Ajay Arora and others (2013) 10 Supreme Court Cases 581), the Hon’ble Supreme Court held that quashing of criminal proceedings at the inception would amount to stifling legitimate prosecution and investigation should not be scuttled at the very inception. He also relied on the judgment of Hon’ble Supreme Court in the case of Neeharika Infrastructure Private Limited v. State of Maharashtra (2021 SCC OnLine SC 315), wherein it is held that the discretion has to be given to the investigating agency to decide the course of investigation and also the High Court under the powers under Section 482 of Cr.P.C cannot pass orders in the manner of closing a legitimate criminal proceeding. Therefore counsel prayed to dismiss the petition.

As evident from the record, there are ongoing disputes in between the parties since the year 2006. All the issues in between the parties were carried to the civil courts. The civil courts have adjudicated upon the disputes in between the parties and admittedly, most of the suits were also disposed off by the civil courts. Three of the cases are still pending and the said details are given in a tabulated form by the counsel for the petitioners and details regarding the pendency of cases and status mentioned in the said table are not disputed. For the sake of convenience, the said table is extracted hereunder:

S.No

Case No.

Appellant/ Plaintiff

Respondent/ Defendant

Court

Status

Date of Judgment

1

Arb.O.P.No 2739/2013

Kazmi Group (defacto Complainant)

Petitioners in the present criminal petition others

XXIV ACJ, CCC

Allowed

26.11.2015

2

CMA No.959, 960, 1023

of 2015

Petitioners in the present criminal petition others

Aslam Kazmi and Others (defacto complainant)

HIGH COURT

Partly allowed

10.02.2016

3

Civil Appeal No.3747 of 2018

Petitioners in the present criminal petition others

Kazmi Group (defacto complainant)

SUPREME COURT

Allowed

11.04.2018

4

O.S.No.749/

2018 Suit for Specific Performance

M/s. Koushik Project & another

The petitioners herein and Kazmi Group

III ACJ, CCC

Pending

—

5

I.A.No.2927/

2018 in O.S.No.749/ 2018

M/s. Koushik Project & anr

The petitioners herein and Aslam kazmi & Others

III ACJ, CCC

Dismissed

04.01.2019

6

O.S.No. 664/2014

Suit for Specific Performance

Syed Vaseemuddin

The petitioners herein and Aslam kazmi & Others

III ACJ, CCC

Dismissed

22.01.2020

7

O.S.No. 43/2011

Suit for Specific Performance

Krishnamurthy

Aslam kazmi & Others

XIV ACJ, CCC

Pending

16.12.2022

8

O.S. No. 3631/2009

Mount Meru Apartments Welfare Association

Aslam kazmi & Others

VII JCJ, CCC

Dismissed

23.04.2012

9

O.S.No. 1374/2009

A.

Eswaramma

Aslam Kazmi & Others

IV SC

Judge CCC

Dismissed

24.01.2011

10

O.S.No. 416/2012

Mohd. Ahmed Khan Pashaa

Aslam Kazmi & Others

IV SC

Judge CCC

Dismissed

30.07.2014

11

O.S.No. 99/2012

Bilkhis Begum

Aslam Kazmi & Others

III ACJ, CCC

Dismissed

26.11.2012

12

O.S.No. 100/2012

Md. Zubair Alam

Aslam Kazmi & Others

III ACJ, CCC

Dismissed

26.11.2012

13

O.S.No. 101/2012

S. Nazeem Uddin

Aslam Kazmi & Others

III ACJ, CCC

Dismissed

26.11.2012

14

E.P.No. 533/2021

Md. Zubair Alam

Aslam Kazmi & Others

III ACJ, CCC

Pending

15

O.S.No. 240/2013

Syed Subtenabi Abdi Sohrad

Aslam Kazmi & Others

III ACJ, CCC

16

GPA Doc.

No. 1441/2013

Aslam Kazmi & Others

In favour of Shoib Bin Hamed

Dt. 22.05.2013

17

Sale Deed No.

1440/2013

Aslam Kazmi & Others

In favour of Syed Nizamuddin

Dt. 22.05.2013

18

Gift Settlement Doc. No. 702/2013

Aslam Kazmi & Others

Aslam Kazmi

Dt. 07.02.2013

19

O.S. No. 749/2018

M/s. Koushiki Projects & Kolli Vijay Kumar

Aslam Kazmi & others

III ACJ, CCC

Pending

19.12.2022

20

Sale Deed No.

6693/2018

Aslam Kazmi & others

In favour of Kolli Vijaya Kumar

28.08.2018

21

Sale Deed No.

6694/2018

Aslam Kazmi & others

In favour of M/s Koushiki Projects

28.08.2018

22

Agreement of sale No. 6695/2018

Aslam Kazmi & others

In favour of M/s Koushiki Projects

28.08.2018

No doubt, commercial transactions or breach of contacts in between the parties in the course of business may amount to criminal acts also which can be tried simultaneously. When the civil disputes are pending before the civil courts, only for the reason of pendency of civil disputes, it cannot be said that criminal proceedings cannot be maintained. However, the Court has to look into whether the transactions are predominantly civil in nature and whether such criminal cases are filed for the purpose of pressurizing the parties for settling civil disputes.

All the civil disputes which were carried to the civil courts, High Court and Hon’ble Supreme Court are not in dispute. The said disputes are from the year 2009 itself and the contract was in the year 2006. Several transactions transpired in between the parties over the period of nearly 14 years and ultimately, criminal complaint is filed. A reading of the present criminal complaint, the allegations made are regarding the agreement entered into the year 2006 in between the 1st petitioner and others and also the family of the 2nd respondent in developing the property.

The Hon’ble Supreme Court in the case of Mohammed Ibrahim and others v. State of Bihar and another (2009) 8 Supreme Court Cases 751 held that when disputes are essentially civil in nature, it is the duty of the criminal courts to check abuse of the process and see to that criminal proceedings are not misused to pressurize and settle civil disputes.

The Hon’ble Supreme Court in the case of Indian Oil Corporation v. NEPC India Limited and others (2006) 6 Supreme Court Cases 736 held that when the disputes arise out of breach of contract and civil remedy was available, the allegations in the criminal complaint has to be considered and the High Court under Section 482 of Cr.P.C quash such criminal proceedings which are made with an intention of setting civil disputes.

At this length of time only on the basis of observations of the XIV Additional Chief Judge in the judgment dated 26.11.2015 in Arb.O.P.No.2739 of 2013 that the plea of the 1st Petitioner herein and 1st respondent in Arb. OP was found to be suspicious, the said observations made cannot be made basis to continue criminal proceedings. All the transactions mentioned in the complaint are subject matter of adjudication before the civil courts and since the disputes are predominantly civil in nature and parties have approached civil courts to ascertain their rights and settle grievances, I find that the criminal prosecution at this length of time on the very same facts cannot be maintained. The Hon’ble Supreme Court in the case of State of Haryana and others v. Bhajan Lal and others 1992 Supp (1) Supreme Court Cases 335 held that where a criminal proceeding is manifestly attended with mala fide and/or where the proceeding is maliciously instituted with an ulterior motive for wreaking vengeance on the accused and with a view to spite him due to private and personal grudge cannot be maintained.

Viewed from any angle, registration of crime and continuance of criminal proceedings against the petitioners cannot be permitted which is abuse of the process of law.

In the result, the proceedings against the petitioners/A1 and A2 in FIR No.198 of 2020 on the file of SHO, CCS, Hyderabad are hereby quashed.

Accordingly, the Criminal Petition is allowed. As a sequel thereto, miscellaneous petitions, if any, shall stand closed.