2018 (1) TMI 1094 - HC - Indian Laws

Maintainability of petition - Prayer for quashing of FIR - it was claimed that the FIRs do not disclose commission of any cognizable offence as the dispute between the parties is purely civil in nature - whether this Court should entertain the present petitions under Section 482 Cr.P.C. at this stage, in view of the fact that the earlier preferred petition under Section 482, i.e. W.P.(Crl.) No. 498/2005, and the other petitions mentioned in paragraph 5 above were withdrawn with liberty to agitate all issues before the Trial Court at the appropriate stage/ stage of consideration of charge? Held that - the present petitions are completely misconceived and the petitioners are not entitled to seek quashing of the aforesaid FIR - Pertinently, the earlier quashing petition being W.P.(Crl.) No.1163/2003 filed in relation to FIR No.99/2002, already stands dismissed on 24.03.2005. The said order was upheld by the Supreme Court when the Special Leave Petition against the same was also dismissed. The dismissal of the appeal preferred by the VLS under Section 10F of the Companies Act by this Court, or the further dismissal of the SLP by the Supreme Court has absolutely no bearing on the continuation of the criminal proceedings since the said development cannot be said to be relevant or material development qua the criminal proceedings undertaken in respect of the aforesaid FIRs. The present petitions are completely misconceived and they are liable to be dismissed.

Issues Involved:
1. Quashing of FIRs.
2. Nature of the dispute (civil vs. criminal).
3. Maintainability of second quashing petitions.
4. Conduct of the petitioners and abuse of the legal process.
5. Costs imposed for frivolous petitions.

Issue-wise Detailed Analysis:

1. Quashing of FIRs:
The petitioners sought to quash multiple FIRs and related proceedings on the grounds that the disputes were purely civil in nature and did not disclose any cognizable offense. The FIRs in question were registered based on complaints by VLS Finance Ltd. alleging offenses under various sections of the IPC, including Sections 420, 406, 409, 468, 471, and 120B. The petitioners had previously attempted to quash these FIRs through various petitions, all of which were dismissed or withdrawn with liberty to raise issues before the Trial Court.

2. Nature of the Dispute (Civil vs. Criminal):
The petitioners argued that the disputes were civil in nature, stemming from a business transaction involving investment in a hotel project. They contended that the alleged offenses were essentially breaches of contractual obligations and should not be treated as criminal matters. However, the court noted that the allegations involved elements of forgery and fraud, which inherently have criminal implications. The court emphasized that criminal proceedings cannot be quashed merely because there is a civil aspect to the dispute.

3. Maintainability of Second Quashing Petitions:
The petitioners relied on several judgments to argue that a second quashing petition is maintainable if there are new developments or changes in circumstances. They cited cases like SMS Pharmaceuticals Ltd. vs. Neeta Bhalla and Krishna Narain Lal vs. State of Bihar to support their claim. However, the court found that the so-called new developments, such as the dismissal of an appeal under Section 10F of the Companies Act, were not material to the criminal proceedings. The court held that the earlier petitions had already provided the petitioners with the opportunity to raise their issues, and the present petitions did not present any special circumstances warranting a fresh consideration.

4. Conduct of the Petitioners and Abuse of the Legal Process:
The court strongly criticized the petitioners for their persistent attempts to stall the criminal proceedings through multiple petitions and appeals. The Supreme Court had previously noted the petitioners' conduct as an abuse of the legal process. The court observed that the petitioners had repeatedly failed to disclose all relevant proceedings and had engaged in deliberate and intentional non-disclosure. The court emphasized that such behavior constitutes an abuse of the process of the court.

5. Costs Imposed for Frivolous Petitions:
Given the petitioners' conduct and the repeated filing of frivolous petitions, the court imposed costs of ?50,000/- on each petitioner. Half of the costs were to be paid to VLS Finance Ltd., and the other half to the Delhi State Legal Services Authority. The court directed the petitioners to deposit the costs within two weeks, and all interim orders were vacated.

Conclusion:
The court dismissed the petitions, finding them completely misconceived and an abuse of the legal process. The petitioners were subjected to costs for their frivolous and repetitive attempts to quash the FIRs. The court reiterated that criminal proceedings cannot be quashed merely because there is a civil element to the dispute and emphasized the need to prevent the abuse of the judicial process.

← Previous Next →