SHRENIKBHAI SURENDRABHAI SHAH Vs. KEYURBHAI PRAVINCHANDRA SHAH

JUDGEMENT

(1.) By way of this petition under Articles 226 and 227 of the Constitution of India, the petitioner original complainant/ accused has prayed for an appropriate order to quash and set aside the impugned order dated 1st September, 2005 passed by the learned Metropolitan Magistrate, Court No. 16, Ahmedabad staying the proceedings of Criminal Case No. 142 of 2004 filed by the petitioner under Section 210 of the Criminal Procedure Code ("Cr.P.C." for short). It is further prayed to issue appropriate directions to the learned Metropolitan Magistrate, Court No.16, Ahmedabad to proceed with Criminal Case No. 142 of 2004, filed by the petitioner.

(2.) The petitioner has filed Criminal Case No.142 of 2004 against respondent Nos. 1 to 4 herein for the offences punishable under Sections 406, 408, 409 read with Section 34 of the Indian Penal Code ("IPC" for short). It is the case on behalf of the petitioner that he is Engineer and he has acquired considerable experience in the business of manufacture and sale of chemicals due to his family business. That respondent No.1 Keyurbhai Pravinchadra Shah, who is son of Pravinchandra Nathalal Shah, was a Director of Madhavpura Mercantile Cooperative Bank Limited ("MMC Bank" for short) during the year 1997 to 1999, approached the petitioner in the year 1997 with a request to help him in purchasing one factory put to auction at Ankleshwar. Said Keyurbhai was also in the business of chemicals, the petitioner was knowing him as a businessman in the said business. It is the case on behalf of the petitioner that initially he was not inclined to join hands with said Keyurbhai as he was very busy with his family business of manufacturing and selling chemicals, that after persuasion by said Keyurbhai and on assurance given by him that the petitioner has to give guidance in the production and sale of chemical which might be manufactured in the factory which was to be purchased in the auction, the petitioner agreed to the said proposal. It is submitted that they participated in the auction and purchased the Unit at Ankleshwar for Rs.60 lacs and the said Chemical Factory was started in the name and style of Shree Siddhi Intermediates Private Limited ("the Company" for short) by forming and constituting a private limited Company, wherein Keyurbhai Shah was the Managing Director and the petitioner was a Director. It is case on behalf of the petitioner that Registered Office of said Company was situated at Ahmedabad and its transactions were with Khadia Branch of the MMC Bank, as the father of Keyurbhai Shah was a Director of the MMC Bank. It is the case on behalf of the petitioner that the petitioner was only giving advice regarding the line of production and sales to Keyurbhai Shah and said Keyurbhai Shah was managing entire affairs of the Company and even the account of the Company with the MMC Bank was operated by said Keyurbhai Shah alone and he was signing all the documents and cheques in the transactions with the MMC Bank. It is the case on behalf of the petitioner that after purchase of the factory at Ankleshwar and after constituting the Private Limited Company, an application came to be submitted to the MMC Bank on 08.06.1998 for loan of Rs.50 lacs and the said Bank sanctioned the loan and after executing necessary documents, the said amount was disbursed to the Company on stock in trade and book debts as security. It is further submitted that thereafter on 27.03.1999, an application was submitted for further limit of Rs.50 lacs so as to make a total loan of Rs.1 Crore and the said Bank sanctioned the same and necessary documents were executed. It is further submitted that again an application came to be submitted on 14.08.1999 for increasing the said limit by further Rs.50 lacs and making it to Rs.1.5 Crore and the Bank sanctioned the same and the limit was increased to Rs.1.5 Crore on execution of necessary documents. That on 30.03.2000, the said limit was increased from Rs.1.5 Crore to Rs.3 Crore on an application made by the Company and the Bank has sanctioned the same on execution of necessary documents and the said limit was upto 31.07.2000 only and the stock in trade was required to be hypothecated with the MMC Bank. It is the case on behalf of the petitioner that though said advance was upto 31.07.2000 only and thereafter, it was coming to an end, the MMC Bank has continued the said facility without there being any application to extend the same and without there being any sanction by the Board of Directors of the MMC Bank. It is submitted that all the monetary transactions were carried out by said Keyurbhai by signing cheques and other vouchers and the petitioner was not taking any part in the operation of the said account with the MMC Bank. It is further case on behalf of the petitioner that the petitioner was not participating in day to day administration and was giving necessary guidance for manufacture of goods manufactured in the said factory. He was not aware about the transactions with the MMC Bank carried out by Keyurbhai Shah. It is submitted that since there was huge amount over due and due to certain mismanagement and irregularities, operation of the MMC Bank came to a grinding halt, the MMC Bank started filing Suits in the Court of Board of Nominees against the defaulters and as such Lavad Case No. 1000 of 2002 came to be filed against the Company and said Keyurbhai Shah, the petitioner and two other guarantors for the amount of Rs.7,42,005,418. 28ps. which was due and payable as on 31.03.2002 in the Account No.IHP 3846. It is the case on behalf of the petitioner that summons of the said Suit was served upon the petitioner, the petitioner came to know about the financial irregularities committed by said Keyurbhai Pravinchandra Shah and thereafter, the petitioner obtained the copies of accounts from the MMC Bank and he noticed certain transactions which were not necessary for the business of the Company and transactions have nothing to do with the business of the Company and huge amount were paid by Keyurbhai Shah to various parties through the Bank and it was found that though the facility was upto 30.07.2000 only and which was not extended by submitting necessary application, the MMC Bank has extended the said facility without consent and knowledge of the petitioner and said Keyurbhai has taken the benefit of the same and has made payments which are not for the business of the Company and the said amount comes to Rs.6,86,50,720/-. It is the case on behalf of the petitioner that since father of Keyurbhai Shah, i.e. Pravinchandra Shah was a Director of the MMC Bank and because of his influence, the said transactions were carried out by said Keyurbhai Shah without knowledge of the petitioner and said Keyurbhai Shah has caused loss to the Company and committed criminal breach of trust with the Company and the petitioner to a large extent. It is further alleged that when the petitioner came to know about these facts after filing of the Suit and after he verified accounts of the Company with the MMC Bank, the petitioner filed a criminal complaint being Criminal Case No. 142 of 2004 in the Court of learned Metropolitan Magistrate, Court No.16, Ahmedabad against said Keyurbhai Pravinchandra Shah who was Managing Director of the Company, his father Pravinchandra Nathalal Shah, who was a Director of the MMC Bank, Shri Devendrabhai Pandya, who was Managing Director of the Bank and Shri Kirenbhai Pandya, who was Branch Manager of Khadia Branch of the MMC Bank for the offences punishable under Sections 406, 408, 409 read with 34 of the IPC and the said complaint was filed on 16.07.2004. the learned Metropolitan Magistrate, Ahmedabad on 16.07.2004 after recording the statement of the petitioner, directed the concerned Police Station to conduct inquiry under Section 202 of the Cr.P.C. and make a report on or before 16.08.2004. That the Police Sub-Inspector of Khadia Police Station conducted a detailed inquiry into the said case, recorded statements of various persons and thereafter, submitted report to the learned Metropolitan Magistrate and after receipt of the said report, the learned Metropolitan Magistrate again directed further investigation by Kalupur Police Station under Section 202 of the Cr.P.C. and thereafter, Senior Police Inspector, Kalupur Police Station, submitted his report to the Court of learned Metropolitan Magistrate, Ahmedabad and the learned Metropolitan Magistrate, Ahmedabad after considering the said report by order dated 1st September, 2005 has stayed further proceedings under Section 210 of Cr.P.C. on the ground that the MMC Bank has filed a complaint with the CID Crime(State), Gandhinagar which is registered at CID Crime Branch, Gandhinagar Zone Police Station as C.R.No.I-1/2005 and also for the transactions and sanctioning of loan, advance facilities of Rs.6,86,50,720/-. At the outset it is required to be noted that the MMC Bank has filed complaint before the CID Crime (State), being C.R.No.I-1/2005 against the petitioner i.e. Complainant of Criminal Case No. 142 of 2004 and others i.e. Managing Director and Director of the Company as well as against the Managing Director and Chairman of the MMC Bank for the offences punishable under Sections 406, 409, 420, 467, 468, 471 and 120B of the IPC for obtaining advance facility in favour of the Company of which the petitioner was also the Director. Considering the provisions of Section 210 of the Cr.P.C. and investigation of FIR being C.R.No.I-1/2005 and considering the fact that the investigation is in progress in relation to the offences, the learned Metropolitan Magistrate, has stayed further proceedings of Criminal Case No.142 of 2004 in exercise of powers under Section 210 of the Cr.P.C., by the impugned order. Being aggrieved and dissatisfied with the same, the original complainant of Criminal Case No.142 of 2004 has preferred the present petition under Article 227 of the Constitution of India.

(3.) Mr.B.B.Naik, learned Advocate appearing on behalf of the petitioner has submitted that the impugned order passed by the learned Metropolitan Magistrate under Section 210 of the Cr.P.C. is absolutely illegal and unlawful and deserves to be quashed and set aside. It is submitted by him that the complaint filed the petitioner being Criminal Case No.142 of 2004 before the learned Metropolitan Magistrate against respondent Nos. 1 to 4 is altogether different from the FIR filed by the MMC Bank against the Company, the petitioner and respondent Nos.1 to 4. It is submitted that on bare reading of the complaint filed by the petitioner and the FIR filed by the Bank, clearly shows that the offences are different and the facts constituting the offences are altogether different. It is submitted by him that the complaint filed by the petitioner are for the offences committed by respondent Nos. 1 to 4 against the petitioner and the Company and has nothing to do with the Bank. It is submitted that the allegations in the complaint filed by the petitioner are against respondent No.1 Keyurbhai Pravinchandra Shah with regard to misappropriation of the huge amount of the Company and who was Managing Director of the Company and the complaint is not against the Bank, whereas the complaint lodged on behalf of the Bank being C.R.No.I-1/2005 is filed for misappropriation of the Bank's amount against its Directors, guarantors and other Office bearers of the Bank. It is submitted that basic allegations in both the complaints are altogether different and does not cover under Section 210 of the Cr.P.C. It is submitted that in the facts and circumstances of the case, the provision of Section 210 of the Cr.P.C. is not applicable and the learned Metropolitan Magistrate has committed an error in passing the impugned order. It is submitted that offences committed by the accused in both the cases, i.e. One instituted otherwise than on a police report, and another instituted with a police report, are altogether different and the facts constituting the offences are also different. It is submitted that the allegations in the complaint filed by the petitioner are constituting offences against the petitioner and the Company and not against the Bank whereas in the FIR lodged on behalf of the Bank, offences are committed against the Bank and not against the petitioner and the Company. Therefore, it is requested to quash and set aside the impugned order passed by the learned Metropolitan Magistrate staying the proceedings of Criminal Case No.142 of 2004 under Section 210 of the Cr.P.C.