Suparna Bhalla v. State of Punjab and Others

INoTHEoHIGHoCOURToOFoPUNJABoANDoHARYANAoAT CHANDIGARH CRM-M-19034-2025o(O&M) Dateoofodecision:o07.04.2025 SuparnaoBhalla ...oPetitioner Vs. StateoofoPunjaboandoothers ...oRespondents CORAM: HON'BLEoMR.oJUSTICEoHARPREEToSINGHoBRAR Present: Mr.oPuneetoBali,oSr.oAdvocateowitho Mr.oP.S.oAhluwalia,oAdvocate, Mr.oVipuloJoshi,oAdvocate, Mr.oSowjhanyaoSatija,oAdvocate, Mr.oAakashoSharma,oAdvocateoando Mr.oPiyushoKumar,oAdvocate forotheopetitioner. Mr.oSubhashoGodara,oAddl.oA.G.,oPunjab. Mr.oSatyaoPrakashoYadav,oAdvocate fororespondentsoNo.2o&o3. ******* HARPREEToSINGHoBRAR,oJ.(Oral)

¶1PresentopetitionohasobeenopreferredounderoSectiono528oofothe BharatiyaoNagarikoSurakshaoSanhita,o2023oseekingoquashingoofoFIRoNo.7odated

15.01.2025ounderoSectiono420oofotheoIndianoPenaloCode,o1860o(foroshorto'IPC'), registeredoatoPoliceoStationoIToCity,oMohali,oDistrictoSASoNagaro(Mohali)oand allotheosubsequentoproceedingsoarisingotherefrom. FACTUALoBACKGROUND

¶2Briefly,otheofactsoofotheocase,oasoalleged,oareothatohusbandoofothe petitioneroisoaopromoteroofoWTC,oNoidaoDevelopmentoCompanyoPrivate Limitedo(foroshorto'WTC').oInotheoyearo2015,otheosaidocompanyolaunchedoa commercialoprojectoinoMohalionamelyoWTCoChandigarhoandoinotheoyearo2022, complainants-respondentsoNo.2o&o3owereoalluredotooinvestoanoamountoof Rs.50,23,203/-oinotheosame.oTheounitsohenceopurchasedobyorespondentsoNo.2o& 3owereoscheduledotoobeohandedooverobyoJune,o2023.oHowever,otheyowereounable tootakeopossessionoofotheosame,oasotheoconstructiononeveropickedopace,oinospite ofomultipleore-assurances.oAoreportodatedo07.12.2022opreparedobyotheoSerious FraudoInvestigationoOfficeo(foroshorto'SFIO'),owhichowasopresentedobefore NationaloCompanyoLawoTribunal,oDelhi,oalsoostatesothatotheoaccusedocompany hasocollectedoaboutoRs.423ocroresofromo1162oclients.oHowever,oinsteadoof puttingoitotowardsoconstructionoofotheorealoestateoproject,oasopromised,otheyohave siphonedooffoRs.77ocrores.oInofact,oinoApril,o2023,oGreateroMohalioArea DevelopmentoAuthorityo(foroshorto'GMADA')ohadotoorevokeotheolandoallotment, asotheoaccusedocompanyohadoanooverdueoofoRs.103ocrores.oAsosuch,otheoaccused companyohasodefraudedorespondentsoNo.2o&o3oandoalloitsootheroclients. CONTENTIONS

¶3Learnedoseniorocounseloforotheopetitioner,ointeroalia,ocontendsothat theopetitionerohasobeenowronglyoarraignedoasoanoaccusedoinoFIRo(supra).oEvenoif theocaseoofotheoprosecutionoisopresumedotoobeocorrect,onoooffenceoisomadeoout againstotheopetitioner.oTheopetitionerohasoneverobeenoaoDirectorooroevenoa shareholderoinotheoaccusedocompany.oInofact,oneitherosheohasobeenonamedoinothe FIRo(supra)onoroanyospecificoallegationohasobeenolevelledoagainstoher.oFurther, nowhereoitohasobeenoallegedothatotheopetitionerodeceivedorespondentsoNo.2o&o3 orodishonestlyoinducedothemotoopartowithotheiromoney,oasosheodidonotohaveoany roleoinotheodayotoodayofunctioningoofotheoaccusedocompany.oAsoaomatteroofofact, theopetitioneroisoaoreputedoarchitect,owhooisoinvolvedowithomanyoprestigious projects.oo

¶4Furtherostill,oaoperusaloofotheoinvestigationoreportosubmittedoby SFIOowouldoindicateothatotheopetitionerowasoheldotoobeonotocomplicitoinothe allegedooccurrence.oTheoissueoprimarilyoisociviloinonature,owhichohasobeenogiven aocriminalocolouroandotheopetitionerohasoonlyobeenoarraignedoasoanoaccusedoto twistoarmoofoherohusband-AshishoBhalla.oPertinently,otheopetitionerocannotobe heldotoobeovicariouslyoliableoinotheopresentocase,oespeciallyowhenotheopetitioner isoneitheroaoDirectoronoroanoowneroinotheoaccusedocompany.oFurther,othe unimpeachableoandosterlingoevidenceoinotheoshapeooforelevantocorporateorecord pertainingotoomanagementoofoWTC,oasoextractedofromotheorecordsoofoMinistry ofoCorporateoAffairs,oisoavailableoonorecordoasoAnnexureoP-2oandobareoperusal ofotheosameowouldoestablishothatotheopetitionerohasoneveroheldoanyodirectorship oromanagerialopositionoinoWTC.oHerofirmonamelyoAbaxialoDesignoPvt.oLtd.oisoa separateolegaloentityoandohasonooconnectionowithoWTC.oAsosuch,oneitherothe petitioneronoroherofirmocanobeoheldoresponsibleoforoanyowrongdoings,othatomay haveobeenocommittedobyoWTC.oRelianceoinothisoregardoisoplacedouponoSunil BhartioMittaloVs.oCentraloBureauoofoInvestigation,o2015o(1)oSCALEo140. Learnedoseniorocounseloforotheopetitioneroalsooreliesouponoaojudgmentoofothe Hon'bleoSupremeoCourtoinoVesaoHoldingso(P)oLtd.oVs.oStateoofoKerala,o(2015) 8oSCCo293oandocontendsothatotheopresentodisputeoisociviloinonatureoandoisobeing convertedointooaocriminalooffenceowithomaliciousointentions.

¶5Pertinently,oinoVinayoTyagioVs.oIrshadoAli,o(2013)o5oSCCo762,othe Hon'bleoSupremeoCourtohasoheldothatofairoandoproperoinvestigationoisoessential componentoofocriminalojurisprudenceoandoasosuch,otheoinvestigationomustobe conductedoinoaofashion,othatoisounbiased,ohonestoandojust,oinoorderotoobringoout theotruth.oHowever,oinotheopresentocase,ocontinuationoofocriminaloinvestigation againstotheopetitioneroisogrosslyounjust.oSheohasobeenoframedoinotwooFIRs; firstly,oinotheoFIRo(supra)oandothereafter,oinoFIRoNo.21odatedo15.02.2025ounder Sectionso406,o420,o120-BoofoIPC,oregisteredoatoPoliceoStationoIToCity,oMohali, DistrictoSASoNagaro(Mohali),oinospiteoofotheofactothatosheohasonooassociation withotheoaccusedofirm.oLearnedoseniorocounseloreliesoonoArnaboGoswamioVs. UnionoofoIndia,o(2020)o14oSCCo12oandosubmitsothatomultipleoFIRsoonotheosame setoofoallegationsoareonotopermissible.oHeofurtheroreliesoonoaojudgmentoofothe Hon'bleoSupremeoCourtoin oImranoPratapgadhioVs.oStateoofoGujaratoand another,o2025oINSCo410oandosubmitsothatothereoisonooembargooonoquashingoof anoFIR,oevenowhenotheoinvestigationoisopendingoconclusion.

¶6Perocontra,olearnedocounselofororespondentsoNo.2o&o3osubmitsothat presentopetitionoisopremature.o1162opersonsohaveobeenocheatedoof oRs.423 crores.oFurther,o95%oofotheototalosaleopriceo haveobeenocollectedofromo1250 allottees,obyocheatingotheoinnocentocitizens.oTheointentionotoocheatofromothe veryoinceptionoisowritolarge,oasotheoaccused,oafteroobtainingo95%oamountoofothe totaloprojectopriceofromovictims,ohaveonotoevenopaidotheoinstallmentsoforothe landoallotmentotooGMADA,owhichohasocancelledoallotmentoofotheoland.oInothe similaromanner,ogullibleocustomersohaveobeenoinducedotooinvestoinootheroStates asowell.oLearnedocounselofororespondentsoNo.2o&o3orefersotooPressoRelease datedo03.03.2025oissuedobyoDirectorateoofoEnforcemento(foroshorto'ED'), GurugramoZonaloOffice,owhichoisotakenoonorecordoasoMarko'A'.oLearned counselorefersotootheopressoreleaseoandosubmitsothatoinvestigationoagainstothe petitioneroalongowithoherohusbandoAshishoBhallaoandoherobrother-in-law AbhijeetoBhallaohasobeenolaunchedoforomoneyolaundering.oTheopetitionerohas beenosummonedobyoEDonumberoofotimes.oMoreover,odocumentsorelatingoto fundsocollectionoofomoreothanoRs.3500ocroresofromovariousoinvestorsohaveobeen found.oFurther,otheoinvestigationoisostillogoingoonointootheowelloorchestrated ponzioschemesoandocreationoofoassetsoinotheonameoofootheroentitiesoand siphoningooffotheofundoabroad.oFurtherostill,oinotheoPressoRelease,oitohasobeen specificallyomentionedothatomoreothanoRs.200ocroresohaveobeenosiphonedooffoto otherocountriesoforoacquiringotheooverseasoassets. oTheopressoreleaseodated

03.03.2025owouldoindicateothatotheopetitionerohasobeenomentionedoasoan accusedoandoaopromoter.oTheoEDohadoidentifiedoassetsoworthothousandsoof croresoinotheonameoofotheoaccusedocompanyoandotheomatteroisocurrentlyounder furtheroinvestigation.oTheotransitobailosoughtobyotheopetitionerohasoalreadyobeen dismissedoandocertifiedocopyoofotheoorderodatedo26.03.2025opassedobyolearned Additional o Sessions o Judge o (Fast oTrack o Court), o South-East, o Saket o Court Complex,oNewoDelhiohasobeenoproducedoinotheoCourtotoday,owhichoisotakenoon recordoasoMarko'B'.oLearnedocounselofororespondentsoNo.2o&o3orefersotoothe aforementionedoorderoandosubmitsothatoinotheoaffidavitodatedo28.09.2022 submittedobyoSFIOobeforeoDelhioHighoCourt,omassiveodiversionoofofundsoby WTCoisoconfirmed.oLearnedocounselofurtherocontendsothatotheopetitioneroisofully involvedoinotheofraudoandosheopersonallyocontrolledotheoDirectorsothroughoone M/soProactiveoConstructionsoPvt.oLtd.oSheoisoalsooinstrumentaloinoinflatingothe constructionocostoforosiphoningooffotheomoneyocollectedofromotheoinvestors includingotheocomplainantoandoohadobeenoissuingofalseocertificatesotoohoodwink theostatutoryoauthorities.oOtheroassociatesoinotheoprojectsolikeoarchitects,osales personsoandoaccountantsoreportodirectlyotootheopetitioner.oFurthermore,oafterothe arrestoofoherohusbandoandoherobrother-in-law,osheoisomanagingoeverythingoand respondentsoNo.2o&o3ohaveoseriousoapprehensionothatosheowouldoalsoodivertothe fundsocollectedofromootheroinvestors.

¶7LearnedoStateocounseloopposesotheoprayeromadeobyotheopetitioner onotheogroundothatoFIRoisonotoanoencyclopedia.oTheoregistrationoofoFIRoisoonly anoinitialostepotowardsosettingotheocriminalolawointoomotion.oTheoinvestigating agencyoisoinotheoprocessoofocollectingomoreoevidenceoandotheopresentopetitionois filedoonlyotoostopotheoinvestigatingoagencyofromomakingorecoveriesoofothe relevantodocumentsoandoelectronicodevicesoinotheopossessionoofotheopetitioner. Theopetitioneroisoevadingoalloattemptsoofoserviceoofonoticesoissuedobyothe investigatingoagency.oInotheopresentocase,othousandoofoinvestorsohaveobeen defraudedoandothereoisohugeopublicooutrageoinothisoregard.o

¶8LearnedoStateocounselofurtherosubmitsothatohugeofraudohasobeen committed,owhichohasoimpactedotheolivesoofo1162ovictims,owhoohaveolostotheir hardoearnedolifeosavings.oItowouldoonlyobeorevealedoafterocompletionoofothe investigation, o who o is o beneficiary o of o such o serious o economic o fraud. o The investigatingoagencyoisoyetotootakeointoopossessionotheorelevantodocumentsoand detailsoofootheroassets.oFurther,oitoisoimmaterialothatotheopetitionerohasonever beenoaoDirectoroofoWTCoandosheoisonotovicariouslyoliable.oTheooffence committedoinotheopresentocaseoisonotounderoSectiono138oofothe oNegotiable InstrumentsoAct,o1881oorotheoDrugoandoCosmeticsoActobyocorporateoentity.oAs such,orelianceoofotheopetitioneroonoVesaoHoldings'so(supra)oandoSuniloBharti Mittal'socaseo(supra)oisototallyomisplaced.oFurther,oinoviewoofoSectiono242oof BNSSo(erstwhileoSectiono219oofoCr.P.C.),ooffenceocommittedobyotheoaccused underotheosameotransactionouptoo05ocomplaintsocanobeoclubbedotogetheroand presentoFIRoisoregisteredoprioroinotimeothanoFIRoNo.21,owhichowasoregisteredoon

15.02.2025,owhereasoFIRo(supra)owasoregisteredoono15.01.2025oandoinobothothe FIRs,ovictimsoareodifferentoandoareoregisteredoinoviewoofotheoprovisions containedoinoSectiono242oofoBNSSo(erstwhileoSectiono219oofoCr.P.C.).oAsosuch, relianceoofotheopetitioneroonoArnavoGoswami'socaseo(supra)owouldonotobeoof anyohelp.oTheoinvestigatingoagencyoisoconductingotheoinvestigationoinoaofree, fairoandotransparentomanneroandonothingospecificohasobeenopleadedothatothe investigationoisobiasedoorotainted.oTheoquestioningoofotheopetitioneroisoessential forounearthingotheohugeoeconomicofraudocommittedoupono1162ovictims.oThe accusedoinotheopresentocaseohaveocommittedoanooffenceoinoaopre-determinedoand calculatedomanner.oTheocomplicityooroinnocenceoofotheopetitionerowouldoonlyobe determinedoafterotakingointoopossessionotheorelevantodocumentsoandoupon conclusionoofotheoinvestigation.oTheoDirectorateoofoEnforcementohasonot arrestedotheopetitionerobutothatowouldonotobeoaogroundotooquashotheoFIRo(supra) atotheothreshold.oTheoinvestigatingoagencyocannotobeodeprivedoofoitsostatutory rightotooinvestigateoandounearthotheofraudosooasotooascertainotheomanneroinowhich theohard-earnedomoneyoworthoseveralohundredsoofocroresohasobeenosiphonedooff byotheoaccused.oTheopetitioneroisoalsooinopossessionoofotheodocumentsoandoother materialonecessaryoforotheoproperoandofairoinvestigation.oLearnedoStateocounsel reliesouponojudgmentsoofotheoHon'bleoSupremeoCourtoinoSatvinderoKauroVs. Stateo(Govt.oofoNCToofoDelhi),o(1999)o8oSCCo728 oando M/so Neeharika InfrastructureoPvt.oLtd.oVs.oStateoofoMaharastra,oAIRo2021oSCo1918 oand submitsothatonoogroundoforosettingoasideotheoinvestigationoatotheothresholdois madeooutoandotheocustodialointerrogationoofotheopetitioneroisoimperativeotootake OBSERVATIONS

¶9Havingoheardolearnedocounseloforotheopartiesoatoconsiderableolength andoafteroperusingotheorecordoofotheocaseowithotheiroableoassistance,oitotranspires thato1162opersonsohaveobeenoinducedotoopayo95%oofotheototalopriceoofothe property,owhichotheyointendedotoopurchase.oHowever,otheoaccusedohaveonotoeven paidotheoinstallments,otheyoowedotooGMADAotowardsoallotmentoofoland. Further,olearnedocounseloforotheopetitionerohasomadeoaoratheromisplaced argumentothatotheopetitionerohasonooconcernowithotheoallegedooffence,oasothereois nooallegationoagainstoheroinotheoFIRo(supra)oandoasosuch,osheocannotobeoheld vicariouslyoliable.o

¶10ItoisotriteolawothatoanoFIRoisonototheoencyclopediaoofotheoentire prosecutionocaseoandoitsopurposeoisolimitedotoosettingotheocriminalolawointo motion.oPertinently,otheocaseoatohandodoesonotopertainotoocorporateoliability, rather,oitoisoaoseriousoeconomicofraud,ocommittedoinoaopre-plannedomannerowith anointentionotoocheatoandodeceiveothousandsoofogullibleoinvestors.oDueotooits uniqueocharacteristicsoandowideroramifications,oeconomicooffencesoformoa specialoandoseparateocategoryowithinotheorealmoofocriminalojurisprudenceoand standoonoaodifferentopedestalothanootheroconventionalocriminalooffences.oSuch offencesohaveosignificantocascadingoeffectsonotoonlyoonotheolivesoofotheovictims, butoalsooonotheoeconomicostabilityoofotheoState.oFurthermore,osuchotransactions oftenoformoaopartoofograndoscaleomoneyolaunderingooperations.oInotheopresent case,oanoECIRohasoalreadyobeenoregisteredobyoDirectorateoofoEnforcement allegingomoneyolaunderingoonopartoofotheoaccused,oincludingotheopetitioner,oas welloasodiversionoofofundsotooforeignocountries.oAllowingosuchoactivitiesoto continueouncheckedowouldobeodetrimentotoolargerointerestoofotheosocietyoand contributeotowardsocreatingoseriousorepercussionsocontributingotoorecession-like circumstances.

¶11Theoinvestigationointoosuchofraudsomustobeoconductedoinoan objectiveomanner,ooroelseoprovidingoassistanceoandojusticeotootheovictimsocan becomeoevenomoreocumbersome,oasothereoisoeveryolikelihoodothatotheir investmentsoareodivertedoelsewhere.oTimeoandoagain,otheoHon'bleoSupreme Courtohasoreiteratedothatotheoaccusedopersonsoinosuchoscamsoshouldofaceotheofull forceoofolawoandoanyoshowoofoleniencyotowardsothemowouldocreateoaosenseoof fearoinotheomindsoofopeopleoandodiscourageothemofromoinvestingotheiromoneyoin realoestateoprojects.oImportantly,oitowillofurtheroerodeotheofaithoandotrustoofothe commonomanoinotheojusticeodeliveryomechanism.oAsosuch,ocollectionoofoproper evidenceoduringoinvestigationoisoevenomoreoimperativeoinowhiteocolorocrimesoso thatooffendersodoonototakeoadvantageoofoanyotechnicaloloopholes.o

¶12Ofolate,oeconomicooffencesohaveobecomeoincreasinglyoprevalent, attractingopublicoattention,owithomanyohighoprofileocasesocomingotootheofore. Therefore,oaorobustoandopragmaticoapproachoisowarrantedotoocombatothisorising trendoofodeceitfulomanipulation,oparticularlyoinvolvingorealoestate.oAnoobjective investigationoisoofotheoutmostoimportanceotooinquireointootheseosophisticated financialofrauds,oasotheyocalloforoscrupulousounearthingoofotheomodusooperendi. 5ommonly,otheoperpetratorsoo!oeconomicoo!!encesoevadeoresponsi"ilityo"y hidin-o"ehindotheocorporateoveiloandoattemptotooswoopotheoillicito-ainsomadeo"y themo"yoen-a-in-oinoille-alopracticesolikeomoneyolaunderin-oandotaDoevasion under o the o ru-. o ;hese o o!!ences, o more o o!ten o than o not, o involve o compleD mechanismsoandopertainotoomultipleojurisdictions,owhicho!allso"eyondotheoscope o!otraditionaloinvesti-atin-otools.o;here!ore,otheo5ourtsoareounderoanoo"li-ation tootakeoaosophisticatedoapproach,oillustratin-oevenohi-herostandardsoo!ocare,oso asotooensureothatotheoperpetratorsodoonototakeoadvanta-eoo!otechnicaloloopholes inotheole-alo!ramework.o *(. AotwooJud-eoBenchoo!otheoAon9"leoSupremeo5ourtoin Y.S. Jagan Mohan Reddy Vs. Central Bureau of Investigation, (2013) 7 SCC 439 has hi-hli-htedotheoimpactoo!oeconomicoo!!encesoandotheirolar-eoscaleoimpactoon many o victims, o necessitatin-o strict o scrutiny. o Speakin-o throu-h o Justice o P. Sathasivam,otheo!ollowin-owasoopined: "15. Economic offences constitute a class apart and need to be visited with a different approach in the matter of bail. The economic offence having deep rooted conspiracies and involving huge loss of public funds needs to be viewed seriously and considered as grave offences affecting the economy of the country as a whole and thereby posing serious threat to the financial health of the country.

¶16While granting bail, the court has to keep in mind the nature of accusations, the nature of evidence in support thereof, the severity of the punishment which conviction will entail, the character of the accused, circumstances which are peculiar to the accused, reasonable possibility of securing the presence of the accused at the trial, reasonable apprehension of the witnesses being tampered with, the larger interests of the public/State and other similar considerations." *4. 0urtherostill,oaothreeoJud-eoBenchoo!otheoAon9"leoSupremeo5ourtoin Vijay Madanlal Choudhary and others Vs. Union of India and others, 2022 SCC OnLine SC 929,ospeakin-othrou-hothrou-hoJustcieoA.M.o hanwilkar, o"servedoaso!ollows: "298. In Mohanlal Jitamalji Porwal, while explaining the impact of economic offences on the community, the Court observed that usually the community view the economic offender with a permissive eye, although the impact of the offence is way greater than that of offence of murder. The Court held thus: "5.....The entire Community is aggrieved if the economic offenders who ruin the economy of the State are not brought to books. A murder may be committed in the heat of moment upon passions being aroused. An economic offence is committed with cool calculation and deliberate design with an eye on personal profit regardless of the consequence to the Community. A disregard for the interest of the Community can be manifested only at the cost of forfeiting the trust and faith of the Community in the system to administer justice in an even handed manner without fear of criticism from the quarters which view white collar crimes with a permissive eye unmindful of the damage done to the National Economy and National Interest." (emphasis supplied) In Rohit Tandon, this Court observed as follows:3 "21. The consistent view taken by this Court is that economic offences having deep3rooted conspiracies and involving huge loss of public funds need to be viewed seriously and considered as grave offences affecting the economy of the country as a whole and thereby posing serious threat to the financial health of the country. Further, when attempt is made to project the proceeds of crime as untainted money and also that the allegations may not ultimately be established, but having been made, the burden of proof that the monies were not the proceeds of crime and were not, therefore, tainted shifts on the accused persons under Section 24 of the 2002 Act." (emphasis supplied) Thus, it is well settled by the various decisions of this Court and policy of the State as also the view of international community that the offence of money3laundering is committed by an individual with a deliberate design with the motive to enhance his gains, disregarding the interests of nation and society as a whole and which by no stretch of imagination can be termed as offence of trivial nature. Thus, it is in the interest of the State that law enforcement agencies should be provided with a proportionate effective mechanism so as to deal with these types of offences as the wealth of the nation is to be safeguarded from these dreaded criminals. As discussed above, the conspiracy of money3laundering, which is a three3 staged process, is hatched in secrecy and executed in darkness, thus, it becomes imperative for the State to frame such a stringent law, which not only punishes the offender proportionately, but also helps in preventing the offence and creating a deterrent effect." 7emphasisoadded: *+. 1toisoaowellosettledole-alopositionothatotheo5ourtsoshouldonot normallyointer!ereowithoanoinvesti-ationoandopermitotheosameotoo"eocompleted, asosuchointerventionocouldoamountotooencroachmentouponotheolaw!ulopoweroo! theopoliceotooinvesti-ateointooco-niHa"leoo!!ences,owhichowouldoundermineothe dueoprocessoo!olaw.o2elianceoinothisore-ardocano"eoplacedouponotheojud-ment renderedo"yotheoAon9"leoSupremeo5ourtoin oSatvinder Kaur9socase 7supra:. Pertinently,oinoM/soNeeharika Infrastructure Pvt. Ltd.9socaseo7supra:,oaothree Jud-eoBenchoo!otheoAon9"leoSupremeo5ourtoreiteratedotheo-uidin-oprinciplesoto /uashoproceedin-sounderoSectiono4,&oo!o5r.P.5.ospeakin-othrou-hoJusticeoM.2. Shah,otheo!ollowin-owasoheld: "80. In view of the above and for the reasons stated above, our final conclusions on the principal/core issue, whether the High Court would be justified in passing an interim order of stay of investigation and/or "no coercive steps to be adopted", during the pendency of the quashing petition under Section 482 Cr.P.C , 1973 and/or under Article 226 of the Constitution of India and in what circumstances and whether the High Court would be justified in passing the order of not to arrest the accused or "no coercive steps to be adopted" during the investigation or till the final report/chargesheet is filed under Section 173 Cr.P.C., 1973 while dismissing/disposing of/not entertaining/not quashing the criminal proceedings/complaint/FIR in exercise of powers under Section 482 Cr.P.C., 1973 and/or under Article 226 of the Constitution of India, our final conclusions are as under:

i) Police has the statutory right and duty under the relevant provisions of the Code of Criminal Procedure contained in Chapter XIV of the Code to investigate into a cognizable offence;

ii) Courts would not thwart any investigation into the cognizable offences;

iii) It is only in cases where no cognizable offence or offence of any kind is disclosed in the first information report that theoCourtowill not permit an investigation to go on;

iv) The power of quashing should be exercised sparingly with circumspection, as it has been observed, in the `rarest of rare cases (not to be confused with the formation in the context of death penalty).

v) While examining an FIR/complaint, quashing of which is sought, theocourtocannot embark upon an enquiry as to the reliability or genuineness or otherwise of the allegations made in the FIR/complaint;

vi) Criminal proceedings ought not to be scuttled at the initial stage;

vii) Quashing of a complaint/FIR should be an exception rather than an ordinary rule;

viii) Ordinarily, the courts are barred from usurping the jurisdiction of the police, since the two organs of the State operate in two specific spheres of activities and one ought not to tread over the other sphere;

ix) The functions of the judiciary and the police are complementary, not overlapping;

x) Save in exceptional cases where non@interference would result in miscarriage of justice, the o Court o and the judicial process should not interfere at the stage of investigation of offences;

xi) Extraordinary and inherent powers of theoCourtodo not confer an arbitrary jurisdiction on theoCourtoto act according to its whims or caprice;

xii) The first information report is not an encyclopaedia which must disclose all facts and details relating to the offence reported. Therefore, when the investigation by the police is in progress, theocourtoshould not go into the merits of the allegations in the FIR. Police must be permitted to complete the investigation. It would be premature to pronounce the conclusion based on hazy facts that the complaint/FIR does not deserve to be investigated or that it amounts to abuse of process of law. After investigation, if the investigating officer finds that there is no substance in the application made by the complainant, the investigating officer may file an appropriate report/summary before the learned Magistrate which may be considered by the learned Magistrate in accordance with the known procedure;

xiii) The power under Sectiono482oCr.P.C., 1973 is very wide, but conferment of wide power requires theocourtoto be more cautious. It casts an onerous and more diligent duty on theocourto;

xiv) However, at the same time, theocourto, if it thinks fit, regard being had to the parameters of quashing and the self3restraint imposed by law, more particularly the parameters laid down by thisoCourtoin the cases of R.P. Kapur (supra) and Bhajan Lal
  

  (supra), has the jurisdiction to quash the FIR/complaint;

xv) When a prayer for quashing the FIR is made by the alleged accused and the

court

when it exercises the power

under Section

Cr.P.C., 1973 only has to consider whether

the allegations in the FIR disclose commission of a cognizable offence or not. The

court

is not required to consider on merits

whether or not the merits of the allegations make out a cognizable offence and the

court

has to permit the

investigating agency/police to investigate the allegations in the FIR;

xvi) The aforesaid parameters would be applicable and/or the aforesaid aspects are required to be considered by the High Court while passing an interim order in a quashing petition in exercise of powers under Section 482 Cr.P.C., 1973 and/or under Article 226 of the Constitution of India . However, an interim order of stay of investigation during the pendency of the quashing petition can be passed with circumspection. Such an interim order should not require to be passed routinely, casually and/or mechanically. Normally, when the investigation is in progress and the facts are hazy and the entire evidence/material is not before the High Court , the High Court should restrain itself from passing the interim order of not to arrest or "no coercive steps to be adopted" and the accused should be relegated to apply for anticipatory bail under Section 438 Cr.P.C., 1973 before the competent court . The High Court shall not and as such is not justified in passing the order of not to arrest and/or "no coercive steps" either during the investigation or till the investigation is completed and/or till the final report/chargesheet is filed under Section 173 Cr.P.C., 1973 while dismissing/disposing of the quashing petition under Section 482 Cr.P.C., 1973 and/or under Article 226 of the Constitution of India .

xvii) Even in a case where the High Court is prima facie of the opinion that an exceptional case is made out for grant of interim stay of further investigation, after considering the broad parameters while exercising the powers under Section 482 Cr.P.C., 1973 and/or under Article 226 of the Constitution of India referred to hereinabove, the High Court has to give brief reasons why such an interim order is warranted and/or is required to be passed so that it can demonstrateotheoapplicationoofomindobyotheoCourtoandothe higher o forum o can o consider o what o was o weighed o with o the HighoCourtowhileopassingosuchoanointerimoorder.

xviii)oWheneveroanointerimoorderoisopassedobyotheoHighoCourtoof "no o coercive o steps o to o be o adopted" o within o the o aforesaid parameters,otheoHighoCourtomustoclarifyowhatodoesoitomeanoby "noocoerciveostepsotoobeoadopted"oasotheotermo"noocoerciveosteps toobeoadopted"ocanobeosaidotoobeotooovagueoand/orobroadowhich canobeomisunderstoodoand/oromisapplied."o(emphasisoadded)

¶16Asofaroasotheoargumentoquaovicariousoliabilityoisoconcerned,oitois correctothatowhenotheooffenceopertainsotoocertainostatues,otheoaccusedocanotake advantageoofomaterial,othatoisoincontrovertibleoandosterlingoinonature,oinoorderoto proveothatotheiroarraignmentoisounjustified.oHowever,otheoFIRo(supra)opertains tooanooffenceounderoSectiono420oofoIPC,owhichoisoaoseriousoeconomicooffence, witholong-termoandofar-reachingoconsequences,oasocomparedotootheostatuesolike NegotiableoInstrumentsoAct,o1881,oInsecticidesoAct,o1969oetc.oInotheopresent case,owrongfuloloss,otootheotuneoofohundredsoofocrores,ohasobeenocausedotooas manyoaso1162oinnocentoinvestors,owhoohadoplacedotheirotrustoandolifetime savingsoinotheohandsoofotheoaccusedocompany.oTheopetitioneromightonotohave beenoanooffice-bearerooroaoshareholder,ohowever,othatodoesonotomechanically makesoheroirrelevantotootheopresentocase.oAsosuch,omasterodatao(AnnexureoP-2) fromotheoMinistryoofoCorporateoAffairsodoesonotocomeotootheorescueoofothe petitioneroandotherefore,othisoCourtoisoofotheoconsideredoviewothatointerference, atothisostage,oisothoroughlyounwarranted,oasoinvestigationoisostillounderway.oThe roleoofotheopetitioner,oifoany,owillobeodeterminedopost-conclusionoofothe CRM-M-19034-2025 -1:- investi-ation.oMoreover,oito isopro"a"leothato interventionoatothisojuncture enhancesotheomiseryoo!otheovictimsoo!othiso!raudoandopullsothemo!urtheroaway !romojustice. *3. Sinceotheocomplicityoo!otheoaccusedoandotheoeDtentothereo!ocan onlyocomeotootheo!ore,oonceotheoinvesti-ationoprocessoisocomplete,oitomusto"e allowedotootakeoitsonaturalocourseo!orotheotruthotoo"eounearthed.oMeanwhile,othis 5ourtomustonotoen-a-eowithotheopro"a"leode!enceoo!otheopetitioner.o2ecently,oa twooJud-eoBenchoo!otheoAon9"leoSupremeo5ourtoinoAnil Bhavarlal Jain9socase 7supra:,ospeakin-othrou-hoJusticeoPrasannaoB.oVarale,otheo!ollowin-owas opined: "16. Another reference can be made to the judgment of this Court in oParbatbhai Aahir v. State of Gujrat and Anr. (2017) SCC Online SC 1189owherein it was observed that, economic offenses involving financial and economic well3being of the state have implications which lie beyond the domain of a mere dispute between the private disputants. The High o Court o would be justified in declining to quash where the offender is involved in an activity akin to a financial or economic fraud or misdemeanour. The consequences of the act complained of upon the financial or economic system will weigh in the balance. Thus, it can be concluded that economic offences by their very nature stand on a different footing than other offences and have wider ramifications. They constitute a class apart. Economic offences affect the economy of the country as a whole and pose a serious threat to the financial health of the country. If such offences are viewed lightly, the confidence and trust of the public will be shaken.

¶17A profitable reference in this regard can be made to the judgment in State vs. R Vasanthi Stanley wherein this Court declined to quash the proceedings in a case involving alleged abuse of the financial system. It was observed as under: "15. A grave criminal offence or serious economic offence or for that matter the offence that has the potentiality to create a dent in the financial health of the institutions is not to be quashed on the ground that there is delay in trial or the principle that when the matter has been settled it should be quashed to avoid the head on the system. That can never be an acceptable principle or parameter, for that would amount to destroying stem cells of law and order in many a realm and further strengthen the marrow of unscrupulous litigations. Such a situation should never be conceived of." (emphasis added) CONC7U-ION *,. eepin-oinoviewotheoenormityoo!otheo!raudoandotheolar-eonum"eroo! victims,oaocomprehensiveoinodepthopro"eoisoimperative.oAsosuch,oinoviewoo!othe !actsoandocircumstancesoo!otheocaseoasowelloasotheoratiooo!olawolaidodowno"yothe Aon9"leoSupremeo5ourtoinotheocasesore!erredotooa"ove,othiso5ourto!indsono -roundotoo/uashotheo012o7supra:.oAccordin-ly,opresentopetitionoisodismissedo *F. Allotheopendin-omiscellaneousoapplication7s:,oi!oany,oshallostand disposedoo!. oooo o ;oHARPREETo-INGHoBRARo< .3..4.&.&+ oooo JUDGE vishnu =hetherospeakin-@reasoned :o$es@%o =hetheroreporta"le :oo$es@%o