2023 (4) TMI 647 - HC - Indian Laws

Unlawful actions of the committee members and Jubilee Hills Cooperative House Building Society in respect of sale deed No.2675 of 2020 and Gift deed No.26BB of 2020 - the accused had transferred the property in the name of A7, thereby committed offences of cheating, breach of trust, impersonation and also evading income tax - HELD THAT - Time and again, this Court and the Hon'ble Supreme Court has found that summoning a person as accused to face criminal trial is a serious step taken by the criminal Court and such summoning can only be done when the Magistrate finds on the basis of facts that the ingredients of the offence alleged are prima facie made out. For the said reason, cognizance order bereft of proper reasoning is liable to be set aside and accordingly set aside. The findings of the police during the course of investigation reflect the role of Ch.Sirisha in filing W.P.No.16087 of 200Z aggrieved by the direction of Registrar of Cooperative Societies not to transfer the property and succeeded. Further, the inspection of site by the Society employees and Ch. Sirisha for illegal encroachments was subject matter of Crime No.91 of 2020. The said cases were suppressed and not stated either in the complaint or the protest petition or in the statement made by Sri B.Ravindranath before the Court. There is a clear suppression of facts in the proceedings at the time of filing both criminal complaint and also the subsequent Protest petition filed by B. Rarvindranath ,on behalf of the Society. Suppression of material facts is a ground for disallowing criminal prosecution. Parties cannot come to Criminal Courts with unclean hands and prosecute a person criminally by suppressing material facts. In such an event, this Court under the inherent powers will not hesitate to quash the criminal proceedings. The complaint was in fact made by the society and the earlier Secretary B.Ravindranath has filed both the complaint and also the protest petition on behalf of the society. The society has now new committee members and it was unanimously resolved that there was no authorization to B. Ravindranath to file the criminal case representing the Society. As such, it was resolved unanimously by the Committee that the launching of prosecution against the petitioners was without any authority and steps have to be taken by the society for withdrawal of the prosecution against these petitioners and appointed the present General Secretary K.Rajeshwar Rao to act on behalf of the society, which is Jubilee Hills Society Limited. The property is that of the society and the society itself represented by its members are not inclined to prosecute the case stating that the Society is not aggrieved. Further no authority was given by the society to B.Ravindranath to lodge the compliant. Criminal Courts are not arenas to fight out personal disputes and wreak vengeance - The Society is having no grievance of the transaction in registering the plot to Ch. Sirisha and when it is found during investigation that the allegations made by B. Ravindranath of impersonation and cheating were found to be false, the proceedings before the trial Court, both on facts and law, cannot be permitted to continue. The proceedings against petitioners/A1 to A3 in Criminal Petition No.545 of 2023 and petitioner / A9 in Criminal Petition No.439 of 2023 in C.C.No.6229 of 2022 on the file of XVII Additional Chief Metroplitan Magistrate, Hyderabad are hereby quashed - Criminal petition allowed.

Summary

Issues Involved:
1. Legitimacy of the complaint filed by the Secretary of Jubilee Hills Welfare Society.
2. Allegations of unlawful actions and fraudulent registration of property.
3. The police investigation's classification of the dispute as civil in nature.
4. Magistrate's cognizance of the offences based on the protest petition.
5. Authorization and locus standi of the complainant to file the complaint.
6. Suppression of material facts in the complaint and protest petition.
7. The society's resolution to withdraw the prosecution.

Issue-wise
Detailed Analysis:

1. Legitimacy of the Complaint Filed by the Secretary of Jubilee Hills Welfare Society:
The complaint was filed by the Secretary of Jubilee Hills Welfare Society Limited, B. Ravindranath, alleging unlawful actions by committee members and fraudulent registration of a plot. However, the society later stated that B. Ravindranath was not authorized to file any criminal case on behalf of the society, and a resolution was passed to withdraw the prosecution initiated by him.

2. Allegations of Unlawful Actions and Fraudulent Registration of Property:
The complaint alleged that a plot initially allotted to Ch. Sirisha in 1988 was fraudulently registered in her name in 2020 with the assistance of A1 to A6 and A9 (Sub-Registrar), at a significantly undervalued price, causing a loss to the society and evasion of taxes. It was claimed that the registration was a benami transaction and that the real Ch. Sirisha had migrated to the USA.

3. The Police Investigation's Classification of the Dispute as Civil in Nature:
After investigation, the police filed a Final Report under Section 173 of Cr.P.C., stating that the dispute was civil in nature. This led to the filing of a protest petition by the complainant before the XVII Additional Chief Metropolitan Magistrate.

4. Magistrate's Cognizance of the Offences Based on the Protest Petition:
The Magistrate, after examining two witnesses, took cognizance of the offences under Sections 120B, 406, 408, 409, 419, 420, 467, 468, 471, and 477A IPC against A1 to A9. However, the order was found to lack detailed reasoning and facts, making it liable to be set aside as per the principles laid down by the Supreme Court in Sunil Bharti Mittal v. Central Bureau of Investigation and other cases.

5. Authorization and Locus Standi of the Complainant to File the Complaint:
The society argued that B. Ravindranath had no authorization to file the complaint, and the new committee members resolved to withdraw the prosecution. Despite this, B. Ravindranath sought to be impleaded in his personal capacity, claiming that he had the locus to contest due to the serious fraud committed by the accused.

6. Suppression of Material Facts in the Complaint and Protest Petition:
The investigation revealed that Ch. Sirisha had legally contested the non-registration of the plot and succeeded. The complaint and protest petition filed by B. Ravindranath did not disclose these facts, leading to the conclusion that there was a suppression of material facts, which is a ground for disallowing criminal prosecution.

7. The Society's Resolution to Withdraw the Prosecution:
The society, through a new resolution, decided not to continue the criminal prosecution, stating that the earlier Secretary acted without authorization. The society appointed the current General Secretary to take legal steps to withdraw the prosecution.

Conclusion:
The proceedings against the petitioners (A1 to A3 and A9) were quashed by the court, as the complaint was filed without proper authorization, and there was suppression of material facts. The society itself resolved not to pursue the criminal case, and the allegations of impersonation and cheating were found to be unsubstantiated during the investigation. The court emphasized that criminal courts should not be used to settle personal disputes or to wreak vengeance.