ASHOK Vs. VASUDEV HANJI

JUDGEMENT

(1.) Petitioner, who is arraigned for offences punishable under Sections 418, 464, 465 and 471 read with Section 34 of the Indian Penal Code along with others, through a private complaint in Private Complaint No. 344/2005, which is now converted into Criminal Case No. 480/2005, has questioned the order dated 17.09.2012, rejecting his application filed under Section 227 of the Code of Criminal Procedure and certain observations made in the course of the order. Before adverting to the contentions raised by the learned counsel Shri Ravi B. Naik, a reference to factual matrix would show; Vasudev claiming to be an Engineering Graduate in Mechanical Engineering, presented the complaint under Section 200 of the Code of Criminal Procedure against the 1st petitioner - Ashok and two others alleging they were good friends. Being qualified Engineers, they embarked on joint venture befitting specialisation in the year 1973 and established a concern under the name of M/s. Ashok Iron and Steels at Udayam Bhag, Belgaum. It was a partnership promoted by the family of accused No. 1 with 75% of shares. He headed the firm and the family of the complainant was assigned 25% of shares represented by the complainant. In 1976, the complainant and the accused No. 1 ventured into another partnership Firm, M/s. Jai Hind Engineering at Udayam Bhag, Belgaum, with the same percentage of shares of profit. The Firm was later converted into Private Limited Company in the year 1982, allotting the shares in the same proportion and in 1999, the 1st accused gained full control over the management of the said Private Limited Company. Having assumed the charge of the management of the said Company, insisted the complainant for conversion of those three Partnership Firms into three Private Limited Companies and then sought for merger.

(2.) The complainant alleged that on 24.03.2004, the General Manager of Finance of M/s. Ashok Iron Works Private Limited, forwarded a draft of Memorandum of Understanding drafted by accused No. 3 for approval of the complainant without any consideration. The 1st accused in collusion with accused No. 3 without the knowledge of the complainant had created such a document. When the complainant refused to sign the Memorandum of Understanding, the relationship was strained. To put an end to the dispute, complainant agreed for settlement through arbitration by accused Nos. 2 and 3, who are Chartered Accountant and Legal Advisor respectively. In pursuance to the consent accorded by the complainant to arbitration, agreements were drafted on 18.08.2004 and forwarded it to accused Nos. 2 and 3 duly signed by the complainant and accused No. 1. He has narrated certain circumstances, in which he submitted to arbitration. His main grievance is, accused Nos. 2 and 3 in connivance with accused No. 1 have deliberately manipulated with the date of arbitration proceedings and thereby tampered the records. It is further alleged that accused Nos. 2 and 3 in the guise of arbitrating, favoured only accused No. 1 and conducted proceedings in a biased manner. He expressed displeasure, which was of no avail. The main grievance is that the documents of Memorandum of Understanding, the arbitration agreement and the notices are all tampered, consequent to which, his legitimate right is affected. The manipulation of dates in arbitration agreement and the proceedings is said to be result of criminality in their conduct to cheat him and thus, invoked Sections 464 and 467 read with Section 34 of the Indian Penal Code, also invoked provision of Sections 468 and 471 of the Indian Penal Code against accused Nos. 2 and 3. The complaint was received by the learned Judicial Magistrate and after taking cognizance, sworn statement was recorded and process was issued to the accused. The accused entered appearance and resisted the prosecution.

(3.) Meanwhile, the parties were in civil action. The orders passed by the arbitrators in Arbitration Case No. 01/2005 was assailed in M.F.A. No. 2395/2009 and it appears Miscellaneous First Appeal is filed by accused Nos. 1 and 2 was disposed of on merits by this Court dismissing it, with liberty to initiate proceedings in an alternate forum. Thus, apart from this parallel proceeding, the accused filed an application under Section 227 of the Code of Criminal Procedure before the learned Judicial Magistrate, seeking discharge. The application is opposed by the complainant resulting in passing of the impugned orders. The learned Trial Judge has dismissed the application being of the opinion that the case was at the stage of recording of evidence, under the provisions of Section 244 of the Code of Criminal Procedure and as the process of completion of the evidence was not over, request for discharge is premature. Secondly, it is held that there is sufficient material on record to show that the charges are not groundless. Consequently, the application under Section 227 of the Code of Criminal Procedure is rejected, assailing which this revision is filed.